Page:Federal Reporter, 1st Series, Volume 1.djvu/825

m EE PKANKLIN M. KETCHtJM. 817 �to draw and indorse cheoks aad drafts. This power was, in fact, not acted on by Franklin M, Ketehum, but by Belknap alone. Belknap had no authority, as between himself and Morris Ketehum, to draw out any money from the bank, except for the proper use and beneût of Morris Ketehum, nor had he any authority to use or dispose of said stocks and securities except by order of Morris Ketehum. Belknap, "without the knowledge or consent of Morris Ketehum, from time to time drew cheeks, in Morris Ketehum's name, against this bank account for varions sums of money, and deposited said cheeks to the credit of the firm of Ketehum & Belknap in the same bank, where they also kept their bank account. These transactions were wholly without the knowledge of Franklin M. Ketehum until after the failure of the firm, when Belknap informed his partner and Morris Ketehum of the fact that he had misappropriated these f unds to the use of the firm by depositing them in their bank account. �Belknap, also, without the knowledge or consent of Morris Ketehum, or of his partner, Franklin M. Ketehum, sold and disposed of some of the stocks and securities belonging to Mor- ris Ketehum, in his possession, and deposited the proceeds of them in the bank account of the firm, and used others of these stocks and securities by hypothecating them with the Fourth National Bank for loans to the firm; and, at the time of the failure of the, firm, some of the stocks thua hypothecated were still held by the bank as security for such loans. The proof of debt first above stated, being the bal- ance of an alleged account, consists wholly of moneys thus transferred by means of cheeks drawn as aforesaid from the account of Morris Ketehum to the account of the firm. The proof of debt second above stated is for the value of the securities so sold, and their proceeds deposited in the firm's bank account, and of those hypothecated with the bank as security for its loans to the firm. At the time of the failure the firm was largely indebted to the bank for over drafts, besides the seeured debt above stated, �After the failure and before the filing of the petition in �v.l.no.lO— 52 ��� �