2 Ky. 317 | Ky. Ct. App. | 1804
This case depends upon two acts of assembly, the one passed in the year 1796, entitled “an act to amend and reduce into one the several acts regulating the town of Lexington and for other purposes and the other in the year 1800, entitled “ an act to appoint commissioners to settle the account of the managers and trustees of the Lexington chances of insurances.” From the first of these acts, and twelfth, thirteenth, and fourteenth sections, it appears that the appellants formed a scheme of chances of insurance on the Lexington lodge lottery, in order to raise a sum of money for paving and repairing the streets, and building bridges in Lexington, and bound themselves to pay to the holders of such chances such prizes as the holders of tickets of the same numbers should be entitled by virtue of the said lottery. It also appears that the said chances were drawn, and, from anything in the record, that the prizes have been paid. But from the last recited act, the proceeds have not been applied to the accomplishment of the objects intended.
The first question which presents itself is, what had the managers of the chances of insurance undertaken and were bound to perform by the scheme? To decide which, it may not be improper to premise that this scheme was formed without the sanction of a law ; the managers, therefore, can be considered as trustees only, subject as other trustees to the control of a court of chancery when they abuse the trust confided to them. The managers had made themselves individually liable to j>ay the amount of all prizes, and as trustees it was their duty to apply the proceeds when received to the objects originally contemplated. The act of 1796 sanctions the scheme, but does not make the managers further or otherwise liable than ihey were by the original scheme, therefore no legislative injunctions have been violated. The next question is, have the managers performed their duty as trustees ? In forming the scheme, the managers were governed by that formed by the lodge lottery, by which bond and security was to be taken from each person who was entrusted with the sale of tickets. By the fourteenth section of the act of 1796, it is enacted that all bonds entered into for the sale of chances of insurance shall be binding on the obligor or obligors. The taking of these bonds, as well as the other parts of the scheme, was legalized, and therefore it is a fair
Therefore, it is considered by the court, that the judgment aforesaid be reversed, annulled, and set aside, and that the appellants recover of the appellees their costs in this behalf expended, which is ordered to be certified to the circuit court of Fayette county.