Court Opinion

ID: 5547659
Source: CourtListenerOpinion
Date Created: 2022-01-10 21:22:12.16589+00
Date Added: 2024-06-11T08:34:57.735705
License: Public Domain

The Chancellor :—The equity of the complainants’ bill is not founded upon any interest which the defendant Reed has in the stock of the companies against which relief is sought. It depends upon the question whether the directors and agents of those' companies had knowledge of, and sanctioned the manner in which the deposits were drawn from the Fulton bank, and whether the deposits thus drawn were applied to the purposes of those companies by the defendants Brown and Reed. This is one of the exceptions to the general rule that a mere witness cannot be made a party defendant.
*Corporations do not answer on oath, and the only way in which a discovery can be obtained from them is through the medium of their agents and officers who are acquainted with the transactions. In Moodalay v. The East India Company and Morton, (1 Bro. Ch. Rep. 469,) the secretary, having no interest in the company, was made a defendant, for the purpose of obtaining a discovery. And in Wych v. Meal, (3 P. Wms. 311,) Lord Talbot shows the reasons on which this exception to the general rule is founded. Those reasons apply as well to the former as to the present officers of the corporation, when the knowledge of the facts of which the discovery is sought rest only with such officers, and especially when it relates to their own official acts. The defendant Reed must answer the complainants’ bill and make the discovery which is sought thereby. What is to be the effect of his answer as to the other defendants, and the final disposition of this suit as to himself, are questions which do not arise under this plea.
Plea overruled with costs.