Page:Federal Reporter, 1st Series, Volume 8.djvu/149

CLAFLIN V. SOUTH CAROIilSA E. CO, IZo �tlie first day of January, 1878, shall be purchased by such certain memutrs of the board of directors hereinbefore set forth, or any one or more of them who may make advances for that purpose; and that upon their said purchase the said coupons shall be held, kept, and retained by such certain members of the board of directors as may purchase the saine, as security for the amouiits ad- vanced for such purchase, and the coupons so purchased shall remain in the hands of such certain members of the board of directors, or their agent, who shall be entitled to all the righcs, liens, and priorities which may appertain to the same, and to the remedies \yhich can or mjiy be maintaiued and enforced thereon agaist the said South Carolina Railroad Company." �In respect to this part of the agreement, as reduced to writing and executed by the president in behalf of the company, it is insisted that it doea not follow the instructions of the directors as contained in their resolutions conferring authority on the president in that behalf, and is not, theref ore, binding on the company. While the orig- inal resolution may not have contemplated firecisely such a contract as this, the evidence shows that the agreement, as drafted, was pre- sented to the finance committee of the board, and approved. After that it was executed. The company dosa not object, but, on the contrary, insists that it be carried into effect. Under these ciroum- stances the present complainants are in no condition to insist that the agreement, as signed, is not actually binding on the company. �That as between the company and the syndicate the coupons were bought, not paid, I think is clear. The argument to the con- trary is based upon a misconception of the evidence contained in the books of the syndicate. These books have been treated by the counsel for the complainants as though they had been kept between the company and the syndicate, whereas they are in fact the books of the treasurer of the syndicate, in which are kept all the accounts of that association. The transactions are all entered as with cash; one side of the journal showing receipts and the other disbursements. ThuB the first entry on the journal shows a demand loan made by the syndicate from the People's National Bank, consisting of the check of that bank on the Bank of New York for $20,000, and pre- mium thereon, $50; in all, $20,050. On the other side it appears that this check was sent to the National City Bank, of New York, to purchase coupons due April Ist. The railroad company was in no way connected with this transaction. The money was borrowed by the syndicate on its own obligations, and sent to the City Bank, not for the credit of the company, but to buy the coupons. Next in order on the journal is a charge of certain notes, or bills payable, made by the syndicate to raise money on. The company had nothing ��� �