Page:Federal Reporter, 1st Series, Volume 8.djvu/16

2 FEDERAL REFOBTEB. �3. Notes Madb in Pubsuancb op Resolution— Recitals oi" Pebamble do �NOT CONSTITUTB PaRT OF AGKBBMBNT. �The note in suit waa made for the accommodation of the M. "V. Ry. Co., in pursuance of a resolution of the board of directors of the company, in the preamble of which it was recited that, ' ' Whereas, in the judgment of the board of directors, the interests of the M. V. Ry. Co. demand that certain rights of ■way ahould be speedily procured, and that the work of construction should be speedily proseouted, these two objects requiring much more money than is at present under the control of the company," etc.; but neither in the resolution nor the agreement, which it proyidedjshould be delivered to the note-makers by the company, was there any mention of the purposes for which said notes were to be used. Held, that these papers do not constitute any pledge or agreement on the part of the railway company, to use these notes for the purposes specifled in the preamble, and for no other purposes. ' �4. Province op Jury — Agreement, as DisriNotnsHFD from Meke Statements �AS To Purposes, Hopes, Etc. �There also being oral testimony tending to prove the existence of an agree- ment to use said notes for the purposes specifled in the foregoing preamble, ,, .^d, that that testjniofly, in cqnnection with the preamble and resolution, is . ' ' for the consideration of; the jury; but in determining whether there wasaucli an agreement, the jury should discriminate so as to be satisfled clearly of the existence of a deflnite agreement to that efEect, as distinguished from mere declarations and statements on the part of the offlcers of the railway company as to the purposes, hopes, and expectations that they entertained eoncerning the matter. �5. Negotiable Pa?er— Notice op Bquitibs— President op Both Corpora- �tions — WHEN PURCHASER ReSFONBIBLE for itlSAPPLICATION OF PrOCEBDB. �The note in suit (accommodation note of I. and others to tho M. V. Ry. Co., above described) was, bef ore it bec^me due, negotiated to the W. bank, through its cashier. It was claimed thai.this was done in violation of the agreement npon which the note was given, ' H, wa? at that time president of both the railway company and the bank, was member of the executive committee pf the railway company and of the discount committee of the bank, and was claimed to have had knowledge of such agreement. Edd, (1) that if H. had actual knowledge of the facts alleged by the makers of the note, and he was aware of and acted in the negotiation on the part of the bank for its discount, while such negotiation was in progress, the bank is chargeable with notice of these facts; (2) but if H., on being inquired of by the cashier in respect to the pro- priety of discounting the note, had replied to liim, "These names are undoubtedly good for $10,000, but my relation to the two companies is such that I decline any part in the decision of the question of discount of the note," and there- upon withdrew and took no furfher part in it, — the mere answering of that question is not such a participation in the transaction as to charge the bank with notice of facts of which H. had knowledge. EM, furthe^, as to the violation of the alleged agreement, that the misapplication of the pioceeds of the note, made by the offlcers of the railway company without the knowledge and participation of the bank, would not'defeat a recovery by the bank on the note. �6. Notice— Corporations— President, Directors, and Other Officers. �Discussion of the subject and full citation of authorities in note. �Bateman e Harper, for plaintiff. �Geo. R. Sage, A. G. McBurney, and Tkos. F. Thompson, for de- fendants. ��� �