President, Directors of Farmers & Mechanics Bank v. Jenks

| Mass. | Sep 15, 1844

Dewey, J.

The evidence offered was, in our opinion, fully sufficient to authorize a jury to find that the plaintiffs were a corporation duly and legally constituted. The production of an act of incorporation, and the actual use of the powers and privileges given by such act, to the extent and in the manner offered in evidence, furnished sufficient grounds to authorize all further inferences of other compliances with the proper requisites for a legal organization of the corporation. Narragansett Bank v Atlantic Silk Co. 3 Met. 282" court="Ky. Ct. App." date_filed="1860-12-26" href="https://app.midpage.ai/document/bond-v-mullins-7129923?utm_source=webapp" opinion_id="7129923">3 Met. 282. Middlesex Husbandmen v. Davis, 3 Met. 133" court="Ky. Ct. App." date_filed="1860-09-27" href="https://app.midpage.ai/document/vanbuskirk-v-levy-7129884?utm_source=webapp" opinion_id="7129884">3 Met. 133. Nor can the objection taken, that the charter of the bank was repealed, or that the act of 1838, c. 14, creating the board of bank commissioners, under which these proceedings were instituted, has been repealed, avail the defendant. All necessary further provisions, for the purpose of adjusting and collecting the assets of the bank, are found in the Rev. Sts. c. 44, § 8, and St. 1844, c. 45, § 1.

It is then insisted that this note was given without consideration, and also was given in aid of an illegal transaction and in fraud of the banking laws of the commonwealth.

We think there was a valuable consideration for the note. In consequence of the giving of this note, the defendant became entitled to the privileges of a stockholder in the bank ; the note being received'as equivalent to cash. As to fraud, this, in point of fact, may, and appears to be, well sustained; but it was a fraud in which all parties participated. For this fraud the bank might have been amenable before the proper tribunal; but it is not competent for the maker of this note to take this objection to a recovery of the amount due thereon, in an action instituted by a receiver appointed by this court, and representing the creditors of the bank. It is assets that may well be collected for the purpose of discharging the debts of the bank, or the expenses of closing its concerns under the orders of the court.

If the avails of this note are not required for these purposes, but are surplus funds to be distributed among the stockholders, the proper remedy for the party would be to file a bill in chancery, setting forth these facts, and praying an injunction on the receiver as to all further proceedings at law to enforce the collection of this demand.

Exceptions overruled, and judgment on the verdict,