95 F. 99 | U.S. Circuit Court for the District of Eastern Pennsylvania | 1899
(after stating the facts). Upon these facts, I am of opinion that judgment must be entered in favor of the defendant. The decision of the supreme court, in Whitney v. Butler, 118 U. S. 655, 7 Sup. Ct. 61, seems to be controlling. In that case a stockholder sold his shares at auction, and the auctioneer delivered to the purchaser the certificate therefor, with a liower of attorney to transfer, duly executed in blank. The purchaser paid the auctioneer for the shares, and the auctioneer delivered the money to the stockholder. No formal transfer of the shares
The plaintiff seeks to avoid the force of these facts by pointing to the by-law, just referred to, which forbids the cashier to buy the shares of the bank without permission from the directors. He argues that, as the seller was a stockholder, he was bound to know the by-laws, and must therefore have been aware that the cashier could not transfer the stock to himself upon the books of the bank. We do not think that either conclusion is inevitable. It may be a fair subject for dispute whether a stockholder is chargeable with knowledge of such a by-law; but, even if it be assumed that such knowledge should be imputed to Mr. Coyle, we .see no reason why he might not properly suppose that the cashier had received permission from the directors to buy the stock. Certainly he was not bound to assume that the cashier was acting in violation of the rules of the bank. On the contrary, the ordinary presumption that men are acting lawfully might, with propriety, lead him to suppose that the cashier had received authority to make the purchase. The fact that the minutes of the directors are silent upon this point is not de-
We can see no ground, therefore, upon which to hold that the liability of Mr. Coyle continued. He did everything required by the usual course of business and by the rules of the bank to pass 1lie formal title to the purchaser. He had not only no reason to suppose that the transfer had not been made, but he had every reason to believe that the necessary formalities bad been observed. We are not prepared to decide that the seller of shares of a national bank is always bound to see that the transfer is made upon the books, and continues to be liable until such a transfer is made: Sometimes he may be thus bound. But in the present case we think the facts agreed upon furnish a complete defense to the plaintiff’s claim. We direct judgment to be entered in favor of defendant.