Court Opinion

ID: 7885717
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:40:38.400852+00
Date Added: 2024-06-11T16:31:44.384287
License: Public Domain

*268The opinion of the court was delivered by
Horton, C. J.:
It appears from the testimony of Noel, the., plaintiff, that after repeated interviews and conversations, on or about July 25, 1880, Drake, the defendant, agreed to sell Noel one hundred and fourteen shares of stock owned by him in the First National bank of Fort Scott, Kansas, at $140 per share, and to give Noel employment as cashier at the bank, at a salary of $1,500 per annum. This evidence supports the allegations of the petition. The trial court held as a matter of law that the contract was void for two reasons: First, that it was impossible of performance; and second, that it was against public policy.
In this ease the last objection to the contract embraces the first, because, if the consideration was void on the grounds of public policy, we must declare the contract impossible of performance, and affirm the ruling of the district court in refusing to.entertain any action for breach of the alleged contract against the promisor. Drake had not the legal authority, either as a director or as the president of the bank, to make an arrangement to remove the cashier of the bank without the consent of the board of directors, or enter into a contract for a sale of the cashiership; and the contract between Noel and Drake for such removal and sale must be held to be contrary to public policy. The purpose and effect of the contract were liable to influence Drake in the decision of a question affecting the private rights of others, by considerations foreign to those rights. The national bank act authorizes the board of directors of a bank to appoint a president, vice president, cashier and other officers, and permits the directors of a bank to dismiss such officers or any of them at pleasure, and appoint others to fill their places. (Sec. 513, U. S. Rev. Stat. 1873-4.) Each person appointed a director of a national bank is required to take an oath that he will, so far as the duty devolves upon him, diligently and honestly administer the affairs of the association, and will not knowingly violate, or willingly permit to be violated, any *269of the provisions of the national bank act. (Sec. 5147, U. S. Rev. Stat.)
In the relation of trust and confidence which Drake occupied as a director and president of the bank, which required him to look only to the best interests of the bank and .its stockholders, it was improper for him to be influenced by agreements with or considerations from a stranger to the association in the selection of a cashier, or in the discharge of any of his other official duties. The appointment of officers by the directors of a national bank ought not to be made a matter of bargain and sale between applicants and members •of the board. (Guernsey v. Cook, 120 Mass. 501; Noyes v. Marsh, 123 Mass. 286; Merchants’ National Bank v. State Bank, 10 Wall. 604-650; Railroad Co. v. Ryan, 11 Kas. 602; Haas v. Fenlon, 8 Kas. 601; Tool Co. v. Norris, 2 Wall. 45.)
The ruling and judgment of the district court will be affirmed.
All the Justices concurring.