Court Opinion

ID: 8861680
Source: CourtListenerOpinion
Date Created: 2022-11-26 17:50:22.940703+00
Date Added: 2024-06-11T17:05:50.688716
License: Public Domain

SANBORN, Circuit Judge.
I concur in the order reversing the decree in this case, because the bill shows that the appellees unlawfully diverted some of the funds of the insolvent bank to the 'payment of unearned dividends to themselves and other stockholders (Hayden v. Thompson, 36 U. S. App. 361, 17 C. C. A. 592, and *51371 Fed. 60); but I am unable to assent to the view that the bill sufficiently sets forth any cause of action against the appellees on account of the Quapaw Mills transaction (Butler v. Cockrill, 36 U. S. App. 702, 712, 20 C. C. A. 122, 127, 128, 73 Fed. 945, 951, and cases cited), or on account of the declaration and distribution of the stock dividend in 1890, — more than three years before the commencement of this suit (Mansi. Dig. Ark. § 4478); and I think the damages resulting from the disposition of the shares of stock for which the promissory notes for §02,732 were finally obtained cannot exceed the difference between the market value of those shares and the value of the notes which were obtained for them at the time when the shares passed beyond the control of the bank. It was the duty of the directors to hold these shares for their par value; but no absolute duty to sell them for that value was ever imposed upon them, unless some one offered to purchase them at that price. Since the bill does not show that any one made such an offer, which they wrongfully rejected, the measure of damage:’, for their disposition of these shares is not the difference between the par value of the shares and the value of the notes *hey obtained for them; but the extreme limit of those damages, in my opinion, is the difference between the market value of the shares and the market value of the notes obtained for them at the time the receivers permitted the shares to pass from their possession and control as directors of the bank.