Court Opinion

ID: 7927546
Source: CourtListenerOpinion
Date Created: 2022-09-08 23:00:22.681101+00
Date Added: 2024-06-11T16:33:14.697618
License: Public Domain

The Chancellor.
The original bill in this case (1.) was filed for the purpose of enforcing the liability of the defendants in that case, a part of whom are the complainants in this cross bill, as directors and stockholders of the Clinton Canal Bank, an institution organized under the general banking law of this state. In order to arrive at a result upon the questions presented upon this demurrer it will be necessary to give a construction to the provisions of the statute bearing upon this class of corporations.
By the 25th section of the original act, Laws of 1837, p. 84, and by the 21st section of the amendatory act, Laws of 1838, p. 32, the directors are made liable for the amount which an insolvent institution organized under these acts may be indebted, and the stockholders are secondarily made liable for the debts of any such insolvent institution in proportion to the amount of stock of any such stockholders.
The 42d section of the act of 1839, page 102 of the Laws of that year, provides that whenever any creditor of a corporation shall seek to charge the directors, trustees or other superintending officers of such corporation or the stockholders on account of any liability created by law, he may file his bill for that purpose in the court of chancery.
By the act under which this bank was organized the liabilities of the directors and stockholders were fixed. The act of 1839 prescribed the mode in which a creditor may enforce this liability.'
The original bill in this case seeks to charge the directors and stock*448holders as such under the act, or in the alternative as partners fraudulently combining under color of the general banking law.
For the purpose of a defence to the original bill the discovery sought by the cross bill is immaterial. The statute makes the directors and stockholders liable for all deficits in consequence of the insolvency of the bank.
If the defendants are fraudulent copartners, they are equally liable for the entire amount of the indebtedness of the concern. It is not alleged that the money is not actually due from the defendants, and the mere fact, from the course pursued by the stockholders and officers of the bank, their notes had become depreciated in the market would not discharge them from their liability, which is for the entire amount of the indebtedness of the concern.
It is not alleged that the complainant is not the assignee of the cer. tificates, but it is alleged that if he is the assignee of the certificates, and holder of the bills he holds them as trustee for Hill, or some other person or persons. Where the object of the bill is merely to collect money or reduce it to possession, it is not necessary for an assignee either of a bond, note or chose in action to make the cestui que trust parties, although the rule is otherwise where the existence or enjoyment of trust property .is to be affected by the prayer of the suit. Calvert on Parties 17, Law Library 212.
There is no pretence that the amount claimed by the bill is not due and I do not perceive how the discovery sought for by the cross bill can constitute a defence.
Demurrer allowed.

.) This caso should have succeeded the case of Wheeler vs. Clinton Canal Bank et. al., on page 449, instoud ot preceding it, that being the original and this the cioss suit.