Haight v. Day

1 Johns. Ch. 18 | New York Court of Chancery | 1814

The Chancellor.

The bill charges the commissioners with an unjust, fraudulent, and corrupt apportionment of the shares subscribed to the Catskill Bank. The shares, exclusive of those to be subscribed by the bank of Hudson, were limited to the number of 6,000, and there were subscribed 36,432. The commissioners were to “apportion the excess among the several subscribers, as they should judge discreet and proper.” The bill charges a gross inequality in the apportionment among the subscribers, and that the distribution was principally confined to the commissioners themselves, their relations, and favourites.

The defendants, in their answers, deny all improper motives, in the execution of their trust, and aver that they made such an apportionment as they deemed discreet and proper, and bqgt calculated to promote the interest of the village of Cqfskill, and of the community at large; and that they believed there was a combination formed to suppress, or injure, the institution; and that this was the governing motive for that extreme inequality in the distribution, which is not denied, bu t admitted. The question arises, whether the injunction, under these circumstances, ought to he continued to the final hearing of the cause. The next annual election of directors, under the charter, ought tp take place on the last Tuesday of this month, and if that be not permitted, the institution will be dissolved. So far, at least, the injunction ought tobe withdrawn; and since all bad faith in the commissioners is denied, and their motives may have been not only pure but commendable, it becomes a serious inquiry» whether the operation of the institution ought to be suspend* ed during the further progress of this suit. The legislature must have considered the establishment of the bank in Calskill of public utility, or they would not have passed the law ; and so long as the operation of the bank is prohibited, so long that public utility is defeated.

The point raised, whether the exercise of the power of the commissioners, in making the apportionment, be subject to judicial correction, need not, necessarily, be decided upon the present motion. 1 have no doubt it may be controlled, if exercised in bad faith, and against conscience; but whether a mere error in judgment ought to be reviewed, is a question deserving of much consideration.

Where a statute gives to commissioners a discretion, in a particular case, and for a special purpose, I doubt, exceedingly, whether a mistake of judgment, in that case, can be corrected. The supreme court seemed to think it could not, in the case of Lawton v. The Commissioners of Highways, (2 Caines' Rep. 182.) In the case of a special power granted to an individual by a will, to be exercised according to discretion, the court of chancery has repeatedly refused to interfere, and to judge of the motive, where there was great inequality in the distribution of property under the trust. (Cevil v. Rich, 1 Ch. Cas. 309. Maddison v. Andrew, 1 Ves. 58.) This is a stronger case than that of a private trust, created by the act of the party, or of a public trust, created for general purposes, and the courts would certainly interfere, in this case, with much greater reserve and caution. Here, the legislature selected the trustees, by name, for a special purpose, and for no other, and confided to them to act, in the given case, as they should judge discreet and proper ; and after the act was performed, they were to become fundi oficio.

These words, “ as they should judge discreet and proper,” gave an undefined discretion, and would be utterly senseless, upon the construction that the apportionment was intended to be, to each subscriber, in a ratio to the amount „ of his subscription. That would have been a plain mathematical rule, without the exercise of any discretion ; and-if that had been the meaning of the law, it would, undoubtedly, have said so. The word apportion must mean, here, to assign to each subscriber,//^give him, such portion as the commissioners should deem meet.

Assuming, then, for the present, that the charge of corruption, or of a wanton and unworthy exercise of discretion, is repelled by the answer, I am of opinion that the injunction ought to be dissolved:

Motion granted.