The assignee could not have issued execution in his own name; and if the statute contemplated expressly a confinement of the right to injunction to the party in whose name execution was issued, an assignee would have no remedy. The language of the statute is," the party suing out such execution:" not," in whose name" it was sued. Has not the representative of the party all the rights of his principal? The VICE-CHANCELLOR. In this case the judgment has been assigned; and the assignor files, what is called, a creditor's bill. The strongest doubt in my mind arises upon the fact of the complainant's not having issued any execution. He relies upn the unsatisfied fieri facias issued by the original plaintiffs in the action. On looking at the statute it does appear that the party suing out the execution should file the bill: 2. R. S. 173, §. 38. It would seem to follow that the purchaser of a judgment who files a bill in his own name, should have first issued an execution. I am satisfied this is not a case in which the the court ought to interfere. Even laying aside the smallness of the amount for which the judgment was assigned, I think the statute sufficiently clear, that the party who sues out the execution shall be the person to file the bill. Here, three years have passed since execution was issued by the original parties; and the complainant, the assignee, has taken out no fresh process. He has not, consequently, exhausted his legal rem edies. I shall refuse the motion, with costs. 1832. WAKEMAN v. RUSSEL. 1832. SCOTT v. THORPE SCOTT and another, vs. THORPE and another. Purchasers of real estate cannot suggest their own alienism as a bar to specific performance. February 11, ' 1833. THE bill in this causé was filed to compel the specific per Specific performance of an agreement for the purchase of a house and lot formance. at Ellenville in this state. Alien. The defendants, in their joint answer, alleged, amongst other things, that the complainants, at the time the aforesaid agreement was made with the defendants, knew that they were foreigners (aliens) and took advantage of them in the price of the aforesaid house and lot; and the defendants had been led to believe, by conversations with the complainants, that foreigners could hold lands'in the same manner as other persons. Mr. N. Dane Ellingwood, for the complainants. Mr. Peter V. Remsen, for the defendants. THE VICE-CHANCELLOR. There are no circumstances in this case to show unfairness in making the contract: the defendants were Englislimen just arrived in this country and voluntarily entered into an agreement with the complainants. The defendants have suggested their being aliens. This point the court cannot look to while it comes from them. They could have obviated this difficulty themselves: by making the necessary deposition or affirmation and having it filed and recorded by the secretary of state: 1 R. S. 720, § 15. There is nothing to prevent a decree for specific performance and there must be the usual reference to the master to report upon the title. The question of costs and all further directions are reserved. Order accordingly. 1832. SCOTT v. DEPEYSTER SCOTT vs. DEPEYSTER and others. Even though a loss accrues to the funds of an incorporated company, aris- If a corporate company engaged in unauthorized and illegal transactions, Directors have a right to repose confidence in their secretary in every Directors are not to be held personally liable as between themselves and a stockholder, unless there has been negligence or fraud. Persons who become directors or managers of a corporation, place themselves in the situation of trustees; and the relation of trustees and cestuis que trust is thereby created between them and the stockholders. The former are obliged to take the same care and use the same diligence as factors and agents. They are answerable not only for their own fraud and gross negligence, but also for all faults which are contrary to the care required of them. Directors are to be looked upon as bailees of the property. And as they are persons generally having an interest in the stock, they are not bailees who are to derive no benefit from their undertaking and, therefore, 1832. SCOTT DEPEYSTER. to be held responsible for slight neglect, but they act in relation to a bailment beneficial to both parties. And the rule then is, they must answer for ordinary neglect; and "ordinary neglect" is understood to be, the omission of that care which every man of common prudence takes of his own concerns. O. G. C., as secretary of an Insurance Company, embezzled its funds, to the amount of one hundred and seventy-seven thousand one hundred and sixty-six dollars and seventeen cents, within three years, by altering checks and keeping back money received to be deposited. He produced forged bank books whenever information was required; and he had written entries in the regular books as if he had actually made the deposits. Committees had been regularly appointed, and before whom he had, from time to time, passed his accounts. Neither his general course of private conduct nor his defalcations were known until he had committed suicide. And as it appeared that the general conduct and investigations of the directors were the same as pursued in other companies by prudent men careful of their own concerns: it was held, on a bill filed by a stockholder against the directors, that they were not personally liable on account of such fraud and embezzlement. December 6, 7, 8, 10. 1832. directors to stockholders THE bill in this suit was filed by the complainant, on behalf of himself and all others stockholders of the National Insurance Company who should come in and contribute to the expenses Incorporated of the suit, against Frederick Depeyster, Isaac Lawrence, BenCompany. Liability of jamin L. Swan, John Bolton, Jacob P. Giraud, Thomas Lawrence, Joseph Grinnell, Philip Hone, Richard Riker, William on account of Whitlock, jr., James K. Hamilton, James Heard, David Hadembezzlement den, Louis F. Varet, Cornelius W. Lawrence, Francis H. by the secreNichol, Horace W. Bulkley, Hickson W. Field and James Lovett, for the purpose of charging them personally with heavy amounts embezzled by Oliver G. Kane as secretary of the said National Insurance Company and of which these parties had been directors. tary. The bill of the complainant set forth the creation of the "National Insurance Company" under an act of the legisla lature passed the fourteenth day of April one thousand eight hundred and fifteen; and that the number of shares in the stock of the company was limited to five thousand at one hun dred dollars each. That the stock, property, affairs and concerns were to be managed by nineteen directors, one of whom was to be president, and who were to hold their offices for one year and until others were chosen; and the president was to be sworn faithfully to discharge his office. That the stock was to be made assignable and transferable according to such rules as the president and directors should establish; and it was further provided, by the seventh section of the said act, that the president and directors should have power to make and prescribe such bye-laws, rules and regulations as to them should appear needful and proper touching the management and disposition of the stock, property, estate and effects of the said corporation and transfer of shares and touching the salaries, duties and conduct of the president, assistant, if any, secretary, officers, clerks and servants employed and touching the election of directors, and all such matters as appertain to the business of insurance. That the said corporation had power to make all kind of marine insurance upon lives by way of tontine or otherwise to lend money upon bottomry and respondentia. And the complainant also set forth, that by the ninth section of the said act, it was enacted, that it should be the duty of the president and directors on the first Mondays of January and July in every year to make a dividend of so much of the profits of the said corporation as to them or a majority of them should appear advisable; and in case of any losses whereby the capital stock should be lessened, no subsequent dividend should be made until a sum equal to such diminution arising from the profits of the corporation should have been added to the capital; and, by the eleventh section, it was enacted, that the said corporation should not, directly or indirectly, deal or trade in buying or selling any goods, wares or merchandize or commodities whatsoever, nor in buying or selling any stock created by any act of congress of the United States or of any particular state, unless in buying the same in order to invest its capital stock or any part thereof by way of securing the said capital stock or in selling the same for the payment of its debts or to invest in other 1832. £COTT v. DEPEYSTER. |