Harris v. The Panama Railroad Co.

dence of his competency to give an opinion, and his experience and knowledge came down to the very time which was to be adopted in determining the value, viz., the season when the horse was injured. True, he afterwards showed he had not sufficient knowledge to enable him to state the market value of the horse in question, but at the time of the inquiry he had shown himself prima facie acquainted with the value at that time.

The objection made was therefore properly overruled; yet I am of opinion that the evidence was liable to the objections I have stated. If by the term irrelevant is meant that it ought not to be permitted to influence the determination of a jury nor enter into their deliberation because it does not, in judgment of law, furnish any safe guide to the determination of the question before them, then it may be called irrelevant.

Although the exception taken does not make the granting of a new trial a matter of right for the reasons above assigned, still the admission of the evidence and its objectionable character may properly be taken into view by the Court, on a motion for a new trial. The Court regard the damages as excessive, and on examination to see whether the estimate put by the jury upon the horse is the apparent result of an honest deliberation upon conflicting evidence, with nothing in the case producing an improper influence upon their minds, we find evidence received to prove that some other horse was sold for $9,000, and can see that, it being received in spite of an objection, (though a groundless one,) the jury may well have regarded the ruling of the Court as an intimation that such evidence was proper to be taken into view in estimating the value of the horse in question. Where injustice is apparently done, the admission of improper evidence which might have influenced the jury, may be regarded by the Court on a motion for a new trial, although the objecting party has not, by the form of his objection and exception, placed himself in a situation to demand a new trial as matter of right.

I have never fully appreciated the justice of a rule which requires the party, in whose favor a new trial is ordered, to pay the costs if the error be deemed the error of the jury; but I suppose it to be too well settled to be at present disregarded.

New trial ordered, on payment of costs of former trial. The subsequent costs to abide the event..

Smith et al. v. Hall.

LIFE SMITH and JOHN BOYNTON, Plaintiffs and Appellants, v. GEORGE V. HALL, Defendant and Respondent.

1. An Insurance Company, incorporated by the laws of New York, cannot make a valid transfer of its notes, amounting to over $1,000 in the aggregate, unless it is authorized by a previous resolution of the Board of Directors, if such transfer be made merely as security for a precedent debt, and to a person knowing that there is no such resolution authorizing the transfer. 2. When the transfer is made to a firm, one of whose members is a Trustee of the Company, the firm has constructive notice of the non-existence of such a resolution.

3. Where the complaint alleges an indorsement of the note by such Company to the plaintiff, and the answer denies the fact of such indorsement, and avers that the transfer was made by some officer or officers of the Company, when it was insolvent, to secure a precedent debt, proof is admissible that there was no resolution authorizing the transfer.

4. Where a promissory note, payable to the order of The Atlas Mutual Insurance Company, was transferred and delivered to the plaintiffs as security for a debt due to them by the Company, and the indorsement was in form: "Pay ....... for account of The Atlas Mutual Insurance Company," G. H. T., Secretary, the restrictive form of the indorsement forms no obstacle to the plaintiffs' recovery on the note against the maker. The collection of the note, and the application of it to the payment of the debt of the Company, would be according to the right of the plaintiffs, and it would be a payment for account of the Company.

(Before BOSWORTH, Ch. J., and WOODRUFF and MONCRIEF, J. J.)

Heard, June 10th; decided, November 5th, 1859.

THIS is an appeal by the plaintiffs from a judgment dismissing their complaint with costs. The action was tried before Mr. Justice SLOSSON, without a jury, in March, 1856.

The complaint states that the defendant made his note, dated the 10th of December, 1855, whereby he promised to pay, six months after its date, to the order of The Atlas Mutual Insurance Company, at the Atlantic Bank, $150; that said Company "indorsed the same to said plaintiffs" before its maturity; that it is past due and wholly unpaid; and that the plaintiff's are the lawful owners and holders of it, and defendant justly owes them thereupon $150, and interest from June 13th, 1856, and prays judgment accordingly.

Smith et al. v. Hall.

The answer avers that the note is wholly without consideration and void; denies that said Insurance Company indorsed it to the plaintiffs, or that they are the lawful owners and holders of it; and alleges that it was transferred to the plaintiffs by some officer or officers of said Company, when the Company was insolvent, to the knowledge of the plaintiffs, for a prior indebtedness of the Company, with intent to give a preference to the plaintiffs over other creditors of the Company, contrary to the statute, and that the plaintiff, Boynton, was at the time a Trustee of the Company.

It alleges that the Company owes the defendant $300, “for moneys due on losses and reïnsurance on policies of insurance heretofore issued by said Company to said defendant,” which sum the defendant claims to set off.

It was proved on the trial that the note in suit, and another note of the same amount maturing June 8, 1856, were given by the defendant to this Insurance Company, upon an open policy, for premiums in advance. The defendant subsequently took risks, the premiums on which amounted to $236.72. It did not appear whether the other note had or had not been paid. The note in suit, with other notes belonging to the Company, amounting in all to $1,153.33, were delivered to the plaintiffs on the 15th of January, 1856, and the plaintiffs gave a receipt therefor, which described the notes and stated that they were "guaranteed by the Company." They were transferred to the plaintiffs as security for the payment of money which they had loaned to the Company previously thereto, (loans having been made from time to time from May, 1855, until shortly prior to the transfer of the note in question.)

It did not appear whether the balance due to the plaintiffs was more or less than the amount of the notes so transferred, or was just that amount, unless it appears from the testimony, uncontradicted, "that this note was indorsed to the plaintiffs for their own exclusive use, and in no part for the use of the Company."

George H. Tracy, the Secretary of the Company, indorsed and delivered the notes so transferred. The Secretary, to the knowledge of the Trustees, had been in the habit of indorsing the notes of the Company. This note, and those transferred with it, were indorsed and delivered to the plaintiffs with the knowledge

Smith et al. v. Hall.

and approbation at the time of the President and Assistant President.

The form of the indorsement was: "Pay of The Atlas Mutual Insurance Company.

for account

"GEO. H. TRACY, Sec'y."

The words of the indorsement, except the name of the Secretary, were printed; and this form of indorsement was printed on many of the notes belonging to the Company.

This and the notes transferred with it, as testified, were "indorsed to the plaintiffs for their own exclusive use, and in no part for the use of the Company."

It did not appear that there was any resolution of the Board of Trustees authorizing the transfer of the 15th of January, 1856, and there was some evidence that no such resolution had been passed.

The plaintiff, Boynton, was a Trustee of the Company and had been from the time of its organization. The Company stopped payment on the 5th of March, 1856.

The Court found as facts:

"1. That the said note was made by the defendant, as alleged in the complaint.

"2. The it was indorsed by said Atlas Mutual Insurance Company as follows: 'Pay........ for account of The Atlas Mutual Insurance Company,' and delivered to the plaintiffs, with other notes, to secure to them the repayment of loans of money made by the plaintiffs to said Company at different times from May, 1855, to some time prior to January 15, 1856, and that the payment of said note was guaranteed by the Company.

"3. That the said note, with others, in all exceeding $1,000 in value, were at one time indorsed as above and delivered to the plaintiffs, and that there was no resolution of the Board of Trustees of said Company authorizing said transaction, or in relation thereto.

"4. That said note was a premium note on an open policy, and given for premiums in advance, and that the Company was in the habit of using such notes, and selling and transferring them for the payment of its debts.

"5. That by the 12th section of its charter, said Company was authorized in the following words, viz.: The Company, for the Bosw.-VOL. V.

41

Smith et al. v. Hall.

better security of its dealers, may receive notes for premiums in advance, of persons intending to receive its policies, and may negotiate such notes for the purpose of paying claims or otherwise in the course of its business; and on such portions of said notes as may exceed the amount of premiums paid by the respective signers thereof, at the successive periods when the Company shall make up its annual statement, as hereinafter provided for, and on new notes taken in advance thereafter, a compensation to the signers thereof, at a rate to be determined by the Trustees, but not exceeding five per cent per annum, may be allowed and paid from time to time.'

"6. The plaintiff, John Boynton, was at the time of this transaction, and had been from the organization of The Atlas Insurance Company, one of its Trustees.

"7. The said note was not taken by the plaintiffs in. payment of the indebtedness of The Atlas Insurance Company to said plaintiffs."

The Court held as conclusions of law:

"1. The indorsement of said note was restrictive in form, and did not transfer the title thereof to the plaintiffs absolutely.

"2. The transfer of said note was void under the 8th section of the act to prevent insolvency of moneyed corporations, as said transfer was not authorized by a previous resolution of the Board of Trustees.

"3. That said note was not such a note as is described in said 12th section.

4. That the plaintiffs could not maintain this action." The plaintiffs' counsel thereupon excepted to the said conclusious of law, and to each of them separately.

Judgment having been entered upon the decision, the plaintiffs appealed from it to the General Term.

J. L. Jernegan, for appellants.

Contended, first, That the form of the indorsement created no obstacle to the plaintiffs' recovery, and cited 2 Doug., 687; 5 Bing., 625; 3 Youngs & Jervis, 220; 1 Mood. & M., 158.

Second. That the answer did not set up as a defense that there was no previous resolution of the Board of Trustees authorizing the transfer, and therefore that fact could not be proved.