Hall vs. Carey.

and that the Acts of the Legislature of 1840, which provided against that contingency, by requiring the assets of the Bank to be placed in the hands of a receiver, for the benefit of the creditors thereof, as well as the Acts of 1841, 1842 and 1843, being amendatory of the Act of 1840, upon that subject, necessarily impair the obligation of that contract, and are therefore unconstitutional and void. In this State, on the dissolution of a corporation, without any special provision by Statute, all the personal estate of the corporation vests in the people, as succeeding to the rights of the crown at Common Law. Whether in equity the debtors to the corporation would be held as trustees, for the benefit of its creditors, it is not necessary now to decide. The people of the State, in whom the personal property of the Bank would have vested. have, in their sovereign capacity, by a legislative enactment, provided against such a contingency, and afforded a remedy, by declaring that the assets of the Bank shall be placed in the hands of a receiver, for the benefit of the creditors of the bank. The legal presumption is, that the makers of the notes received from the Bank a valid consideration therefor. But it is said, the makers of the notes contracted with the Bank with a direct reference to this contingency, of the dissolution of the corporation, and it constituted an important element in the consideration of the notes. It is possible the contract may have been made with the Bank in view of this contingency, that the Bank would lose all remedy by which it could enforce a collection of the notes in the event of a dissolution of the corporation, against the makers; but they must also be understood to have contracted, in view of the right of the people, in whom the assets of the Bank would have vested, on a dissolution of the corporation, by a legislative enactment, to provide a remedy against such a contingency, and to provide a remedy for the creditors of the corporation. The several Acts of the Legislature are remedial in their character, and impair no right vested in the plaintiffs in error, under their contract. They are not deprived of any ground of defence which they would have had against the Bank. The Act of 1843, however, expressly recognises and declares, that the assignment was made by the Bank, of all its real and personal debts and effects, to Carey, the assignee, prior to the judgment of forfeiture, and the plea of the defendants negatives this legislative declaration, which we think the Court below was bound to notice, as the law

Hall vs. Carey.

of the land, being a public Statute, and therefore properly sustained the demurrer to the defendant's pleas.

In regard to the third assignment of error, perhaps it would have been more regular to have tendered the deed of assignment, with the notes, to the jury; but as the assignment was subsequently proved, the plaintiffs' title was made out by different links, in his chain of testimony, and the Court did not err in permitting him to do so. The next error assigned upon the record, is the admission of the Bank books in evidence on the part of the plaintiff.

[3.] The books were offered in evidence for the purpose of proving that the assignment was duly made by the officers of the Bank. Although it is true, that the books of a corporation cannot be received, to establish a right in the corporation, as against third persons; yet, they may be used for the purpose of shewing the regularity and legality of corporate proceedings. Angel & Ames on Corporations, 533-4. The assignment by the Bank to the assignee, of its assets, created no new right: it merely transferred what rights it had. Such transfer of the defendants' notes, placed them in no worse condition, so far as regards the merits of their defence, than if the suit had been brought against them, by the Bank, instead of the assignee. The books of the Bank, we think, were admissible, to shew that the assignment of the assets was regularly and legally made to the assignee. By the Act incorporating the Bank of Columbus, it is provided— “No less than four directors shall constitute a Board, for the transaction of business, of whom the President shall always be one, except in case of sickness, &c." Prince, 85. It is insisted by the plaintiffs in error, that notwithstanding there were four directors present, at the time the assignment was made, that one of them being the Cashier of the Bank, he could not act in the capacity of director and Cashier at the same time-and that one of the directors (Schley) stated, that he never purchased any shares in the stock of the Bank; that thirty shares were transferred to him by Smith and Davis, to make him eligible as a director, and did not know what he had done with the certificate. The position assumed is, that under the state of facts disclosed, the directors were not authorised, under the charter, to make the assignment.

[4.] Persons acting publicly as officers of a corporation, are to be presumed rightfully in office, so far as it regards third persons,

Hall es. Carey.

and their official acts will be binding on the corporation, to the extent of the rights of such third persons. Angel & Ames, 81, 82. An officer, de facto, is one coming into office, by colour of election, and all his acts are good, until he is removed; at least so far as they concern the public, or the rights of third persons, who have an interest in the act done. The people vs. Collins, 7th John. Rep. 549.

[5.] It does not appear on the face of this record, that it is necessary for the defence of the defendants, that the question of the plaintiff's title to the notes, should be inquired into; and we held in Field vs. Thornton, 1 Kelly, 306, that the question of title in negotiable paper, is one which a defendant will not be permitted to raise, unless it is made to appear, that is necessary for the purposes of his defence. The record exhibits the fact, that the notes were given by the defendants, for money advanced by the Bank, to them, to purchase cotton.

It is unnecessary to consider the exception to the admissibility of the copy-deed of assignment in evidence, as the record shews, that afterwards, the plaintiff introduced the original deed in evidence, after having duly proved its execution, on the day it bore date, and that the assignee took the control of the assets of the Bank. The deed of assignment is dated on the 10th of June, 1843, and the judgment of forfeiture was rendered against the Bank on the 13th day of the same month.

The Court charged the jury that the validity of the deed of assignment could not be inquired into, to which the defendants excepted.

The charge of the Court must be understood, in reference to the facts before it. The defendants were indebted to the Bank, for money advanced to them, for which these notes were given. The record does not show it was necessary for their defence, that they should inquire into the validity of the plaintiff's title, as was ruled in Field vs. Thornton, and in that view of the case, the Court did not err, in charging jury, that the validity of the assignment could not be inquired into by the defendants. The whole record exhibits an effort, on the part of the defendants, to get clear of an honest debt, by the misfortunes of their creditors, rather than the justice of their defence.

Let the judgment of the Court below be affirmed.

Daniels vs. Kyle & Barnett.

No. 26.-FRANCIS DANIELS, plaintiff in error, vs. KYLE & BARNETT, defendants in error.

[1.] Notice by a Bank that it will receive on deposite the depreciated bills of another Bank, is no evidence of the insolvency of the Bank making such offer. [2.] If the holder of a Bank check neglect to present the same for paymeut within a reasonable time, and the Bank fail between the time of drawing and the presentation thereof, the drawer is discharged from liability, to the extent of the injury he has sustained by reason of said failure.

[3.] The general doctrine applicable to Bank checks extends to all holders, whether payees or transferees, and that is, that in order to charge the drawer in case of dishonor, the same must be presented for payment within a reasonable time, and notice given to the drawer within a like reasonable time, othererwise the delay is at the peril of the holder.

Assumpsit, tried before Judge ALEXANDER, Muscogee Superior Court, May Term, 1848.

The action in this case was predicated upon a check, of which the following is a copy:

"COLUMBUS, JANUARY 15, 1842. Bank of Columbus, pay to L. Gambrill or order, five hundred and twenty-four dollars.

$524 00.

Indorsed, L. GAMBRILL."

KYLE & BARNETT.

The check having been transferred by indorsement to the plaintiff in error, the suit was brought in his name.

Upon the trial, the check, and also the protest made upon its presentation for payment, and the non-payment, were successively read in evidence to the jury, when the plaintiff closed.

The defendants having pleaded specially, that when said check was drawn on the said Bank of Columbus, to wit: on the fifteenth day of January, 1842, the said Bank was solvent, and paid checks thereon promptly, on presentation; and that before the presentation thereof, to-wit: on the first day of April, 1842, the said Bank failed, and suspended payment, with the funds of these defendants on deposit, to an amount more than sufficient to pay said check; and that by the failure to present said check, these defendants were injured, to the extent of the total loss of said funds-proceeded to the proof of their plea.

They proved from the books of the bank, that the defendants,

Daniels vs. Kvie & Barnett.

at the date of the check, had on deposit in said Bank over two thousand dollars. The Clerk, who identified and proved the books, did not know what funds defendants deposited. It appeared also, from the books, that the defendants had checked out all of their deposits except $524, which last amount appeared still to remain to their credit. The witness, (the Clerk,) farther stated that he left said Bank as Clerk, about the 7th January; 1842; that the Bank had been in a state of suspension some time before that, and believed that it had resumed specie payments on the first of January, 1842, under the Act of the Legislature of 1841; and that about the time he left said Bank it paid specie upon some of its demands; thought specie was not demanded upon checks. The counsel for plaintiff proposed to ask the witness if (at the date of the check sued on) there was hanging at the counter of the Bank of Columbus, a notice to the public that it would receive Planters and Mechanics' Bank bills, and other depreciated paper on deposit, and that it was paying out the same to its depositors, who should deposit such paper, which was objected to by defendants' counsel, and the objection was sustained by the Court below, and decided to be improper. To which decision the counsel for the plaintiff excepted.

Col. Seaborn Jones was then sworn on the part of the defendants, and stated, the Bank resumed specie payments on the 1st January, 1842, under the requirements of the Act of the Legislature of 1841, on that subject, and that said Bank paid specie, but did not remember whether upon the bills of said Bank or checks drawn upon it, but that it paid all presented by him, either in specie or specie funds, but did not remember whether he presented bills or checks, and that the Bank suspended specie payments again in March 1842.

The plaintiff then introduced Sterling F. Grimes as a witness, who testified that the Bank, in January, 1842, received Planters and Mechanics' Bank bills, Central Bank bills, and Alabama Bank bills in payment of notes, (sent to said Bank for collection,) payable in New York, with current rates of exchange, and charging 12 1-2 to 15 per centum premium, as the current rate of exchange upon New York. Augustus Peabody was also introduced as a witness on part of plaintiff, who testified that he went into said Bank of Columbus as Clerk, within four or five days after John D. Carter, the former Clerk, left said Bank as Clerk,) which was a short time be