Court Opinion

ID: 6407479
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:50:05.548453+00
Date Added: 2024-06-11T15:51:15.630944
License: Public Domain

Dewev J.
delivered the opinion of the Court. The plain tiff does not rely upon any express promise of the defendant to pay him the money demanded in this action ; but he contends, that in all cases, the treasurer of a corporation having sufficient funds in his hands as treasurer, is bound to pay all dividends declared by the directors, and that upon failure so *109to do, he subjects himself personally to an action of assumpsit for money had and received, at the suit of a stockholder.
No doubt there are many cases where, without any other privity between the parties than that arising from the fact, that an individual has placed money in the hands of a third person to be paid to another, and the person with whom it was thus deposited neglects or refuses to pay it over, it has been held, that an action for money had and received would lie against him who wrongfully withheld the money, in favor of him to whom the money was due.
A broad distinction however exists between the present case and those which it is supposed to resemble, arising from the peculiar relation which the defendant holds to the parties connected with this case. The Central Bridge Corporation is the principal debtor, the treasurer being the mere servant of the corporation, having no authority or control over the funds except as such servant. The money deposited in his hands is not placed under his control as an individual holder, but it is the money of the corporation ; and the character of these funds is not changed by the act of the directors declaring a dividend and authorizing the payment of the same by their treasurer. There is not, in such a case, any particular appropriation to a stockholder, of any specific funds in the hands of the treasurer, until payment is actually made. It is therefore upon the liability of the corporation, rather than upon that of the treasurer, the stockholders must rely, to enforce the payment of their dividends, in a case where no other ground exists for charging the treasurer, but his mere non-feasance. And this accords with the general rule, that a servant cannot be charged by third persons for mere neglect of duty, but the principal must in such cases be resorted to. This principle seems to be entirely reasonable and proper in its application to cases like the present. The treasurer ought not to be made personally liable to suits which may often arise in cases of controverted title as to the stock ; nor should the corporation be deprived of the privilege of a set-off or other counter claims against a stockholder, as perhaps they might be, if a suit would lie, in such cases, against the treasurer in his private capacity.
The Court are therefore, of opinion, that the plaintiff cannot maintain his action ; and he must become nonsuit.