Bellows v. Hallowell & Augusta Bank

2 Mason C.C. 31 | U.S. Circuit Court for the District of Massachusetts | 1819

STORY, Circuit Justice.

If the special verdict in this case be imperfect, by reason of any ambiguity, or uncertainty, so that the court cannot say for which party judgment ought to be given, the judgment of the district court ought to be reversed, and a venire facias de novo awarded for a new trial at the bar of this court. Rex v. Hayes, 2 Ld. Raym. 1518; Rex v. Huggins, Id. 1574, 2 Strange, 882; Rex v. Woodfall, 5 Burrows, 2661; Goodtitle v. Jones, 7 Term R. 47; Bird v. Appleton, 1 East, 111, note a; Gibson v. Hunter, 2 H. Bl. 187; Town of Shrewsbury v. Kynaston, 7 Brown, Parl. Cas. 396, 2 Strange, 1051. But if the verdict be not ambiguous or uncertain in itself, but the plaintiff has stated a defective case or a defective title, then the judgment ought to be for the defendants, and a venire de novo ought not to be granted. Bentley v. Smith, 3 Smith, J. P. (Eng.) 17. We cannot sajr upon this verdict that there is any ambiguity or uncertainty in the facts found; the defect, if any, (which will presently be considered,) is in the title set up by the plaintiff for a recovery. We are driven therefore to consider the sufficiency of that title, as it stands upon the record.

The plaintiff contends for a reversal of the judgment, in the first place, because the notes in question were made by, and are obligatory upon, the defendants in their corporate capacity. If this ground fail him, he next contends that the defendants have adopted and made the notes their own by the declaration and conduct of their officers. If this position cannot be sustained, he contends in the last place, that the defendants have the funds of the old bank in their possession appropriated to the payment of the notes of the old bank, and that the plaintiff, as holder of the notes now in question, is entitled to so much of these funds as equals the amount of his notes, as money had and received to his use.

The first ground rests on the suggestion that the old bank and new bank are the same corporation, the new charter being but a reincorporation or rather a continuation of the charter of the old bank, which would otherwise have expired by its own limitation. If the premises were well founded, the conclusion would certainly follow, that the new bank is liable for the debts of the old bank. Mayor, etc., of Colchester v. Seaber, 3 Burrows, 1866; Scarborough v. Butler, 3 Lev. 237; Rex v. Pasmore, 3 Term, R. 199; Luttrel’s Case, 4 Coke, 87. But we are called upon to admit these premises, not upon the plain and positive enactments of the statute incorporating the new bank, but upon the collateral facts, that the names of both corporations are the same, the officers are the same, and a majority of the stockholders' are the same; and that the business of the old bank was for a time done, and its debts paid, by the new bank. It is certainly true that a corporation may retain its personal identity, although its members are perpetually changing; for it is its artificial character, powers and franchises, and not the natural character of its members, which constitute that identity. And for the same reason corporations may be different, although the names, the officers, and the members of each are the same. An insurance company composed of the same natural persons and officers, and with the same name as an existing incorporated bank, would still be a different corporation from the bank. The similarity of name, of officers, or of members, or even of objects, cannot then, per se, establish the identity of corporations created at different times, by different, charters, and having a distinct independent being.. And one corporation may transact the business and pay the debts of another coloration without thereby merging in the latter its distinct corporate existence. There is indeed a repugnancy in the statement of the proposition that two corporations are in point of law the same, for it would at the same time establish that there is but one corporation.

To ascertain whether a charter create a new corporation, or merely continue the existence of an old one, we must look to its terms and give them a construction consistent with the legislative intent and the intent of the corporators. In the present case, the charter of the old bank was granted by the act of the 6th of March, 1804, and was to continue from the first Monday of October, then next ensuing, until the expiration of eight years. 3 Mass. Gen. Laws, 206. Its existence was therefore limited to the first Monday of October, 1812; and by an act of the 24th of June, 1812, c. 57, all banks incorporated under the authority of the commonwealth, whose corporate powers were limited by law to or at any time before the last day of October then next ensuing, were authorized to continue corporations until the first Monday of October, 1816, and no longer, for the sole purpose of enabling such banks gradually to settle their concerns and divide their capital stock. And the act contains an express prohibition of their acting as corporations for banking generally. This certainly shews a determination on the part of the legislature not to renew or to perpetuate the existence of any of the banks within the purview of the act; and among these the old bank was unquestionably included. The charter of the new bank was granted by an act of the 23d of June, 1812, c. 47, while the old bank was in existence. It does not purport upon its face to be a grant to an existing corporation, but to private individuals. Its capital stock is less by $50,000 than that of the old bank. The stock is to be held, not by the stockholders of the old bank, but by certain persons named in the act, and their associates and assigns. The act refers also to the old bank, as an existing corporation, and declares, not that the directors of the old bank shall be the directors of the new, but that “any director of the Hallowell and Augusta Bank, now existing, may be eligible/as a director of the bank hereby established.” It further declares that the new bank may take, receive and hold, by assignment, any mortgages held by the old bank “which may be assigned and taken by agreement between the two corporations.” This clause affords abundant evidence that the new charter was not granted to the old corporation, for it contemplates assignments of mortgages between the two banks as distinct corporations; and it would be utterly absurd to say that a corporation might contract with, or make conveyances to, itself. Upon the very face of the charter, then, enough appears to shew, that the legislature contemplated the erection of a new corporation. And if the language had not been so express, the same must have been the conclusion of law; for every charter must be taken to be a grant of a new corporation, unless it be granted to an existing corporation. If indeed the new charter had been granted to the old bank, it would not have been binding until it was accepted by it; and there is not the least pretence to say upon this record, that the old bank ever accepted the new charter, or could by law have claimed it as a grant in its corporate capacity. There is then an end of the argument raised on the first point.

And the second point is upon this record equally untenable. For assuming that the declarations of the officers of the bank in respect to matters within the scope of their duty will bind the corporation, it is not found, and certainly cannot be intended upon this special verdict, that such declarations were within the scope of their duty, or were made with reference to the identical notes now in question. Much less is it found as a fact, (which is necessary to the legal inference,) that the notes in question were adopted by the new bank and issued as its own. If it had been found, that the declarations were made in reference to these notes in particular, and that such declarations were within the scope of the duty of the officers of the bank, there would have been some color to have awarded a venire de novo to have found the other fact. Or if the bank officers had actually issued these notes, as cash from the bank, in payment of • checks or other dues, with the express declaration that they were good and binding on the bank, and that the bank would guarantee them, I am not prepared to say, that such declarations in reference to the notes held and issued by tbe bant would not be within the scope of the duty of the cashier, and would not bind the bank, so far, that if the notes turned out unproductive, the receiver might maintain an action for money had and received against the bank, upon the ground that the bills were not, under such circumstances, a good payment of such checks or other dues. But no facts are found in this special verdict that will enable us to arrive at such a conclusion.

The third point wholly fails for want of facts to sustain it; and it may therefore be at once dismissed.

The questions in this cause have been dis cussed and decided in the supreme court of this state in another cause, (Wyman v. Hallowell & Augusta Bank, 14 Mass. 58;) and I may therefore be well saved a more minute examination of the principles applicable to them, since I entirely concur in that decision.

Let the judgment be affirmed.