Court Opinion

ID: 5409556
Source: CourtListenerOpinion
Date Created: 2022-01-08 16:06:56.025828+00
Date Added: 2024-06-11T08:30:43.752658
License: Public Domain

MacLean, J.
(dissenting). Affirmance of the judgment herein involves disregard of the exception to the refusal to charge upon request of the defendant: The mere fact known *606to the purchaser that Poerschke was a director of the corporation is not sufficient to throw discredit on the note or put a bona fide holder upon his inquiry. Had this request been submitted in writing instead of ore tenus its ingenuity under the surroundings might have been more noticeable and have been followed by other instructions. Circumstances quite sufficient to put the taker upon his inquiry had been testified to in a way likely to impress those who heard the testimony and also those who perused it in the printed case. The jury, however, were not bound to believe it. If by their disbelief it was eliminated, the overt refusal to charge the request amounted practically to an- instruction as the laiv that where a person has sold or has discounted a note of a corporation, in which he is a director to the knowledge of the other party, bank or tradesman, contractor creditor, the latter, it is to be held, had actual “ knowledge of such facts that his action in taking the instrument amounted to bad faith.” Ueg. Inst. Law, § 95 (L. 1897, ch. 612). To that-1 am not willing to subscribe until it has been authoritatively decided in a case directly involving the point, rather than indicted by general expressions in cases where executive officers of corporations have issued paper to themselves. In such cases the appearances of evil are more patent and they may be saved even in them by perfunctory inquiry. Wilson v. Metropolitan El. R. Co., 120 N. Y. 152. That dealings between corporations and their directors are sometimes disadvantageous, even fraudulent and corrupt, is too well known. It is still better known that they are most commonly for the advantage of the corporation themselves. Directors are selected and put upon boards of banks, of manufacturing concerns and of companies generally for the advantage they bring. ' In particular as to dealings in commercial paper their indorsements are often asked upon offering for discount and upon paper given in the ordinary course of business, not for the sake of their individual credit but frequently, well nigh generally, because of their supposed knowledge respecting the corporation’s solvency of which their indorsements are practically guarantees.
Judgment affirmed, with costs.