MR. MACNIDER-I think there is a decision in the Western States. MR. LASH-In the Western States you might find decisions, but I do not think there are any in Massachusetts or New York in favour of the practice. A MEMBER-The western decision Mr. Macnider speaks of supports Mr. Lash's view. MR. LASH-The English cases are exactly in line with the Court of Appeal in Ontario. I think if the matter was threshed out in the United States courts they would have to go that way. A MEMBER-I think companies issuing certificates requir ing their return as a condition of transfer would be bound to insist on their return, and responsible if they should permit a transfer without the certificate being returned. MR. LASH-I think they may waive the condition if they like, and that they are under no responsibility to anyone if they should do so. MR. WALKER-Millions of money are lent in New York on certificates endorsed in blank, but the holders are careful to see that the names are those of reputable members of the Stock Exchange. If presented bearing the endorsements of outside people they would usually be refused. Then the certificates are issued by great railroads and corporations who would not think of making transfers unless the certificates are returned, knowing the use that is made of them, and being interested in the maintenance of absolute good faith. Then, again, such certificates are usually issued and countersigned by a Trust Company, who are still more bound to prevent irregularities. A MEMBER-If the companies issue certificates in terms which imply that the shares will be forthcoming when the certificate is presented with a proper power of attorney, should they not be bound to have the shares? If not, why issue them? MR. LASH-The certificate shows the legal title at the time of its issue. A transfer outside of the company's books (as e.g. by endorsement on the certificate) creates an equitable title in the transferee. If the legal title has passed to someone else (as in the case referred to by the President) before the holder of the equitable title seeks to complete it, the company is not responsible. The law regards the condition as to the return of the certificate as merely a matter of internal regulation. Mr. PrendergAST-I am aware that the decision you quote exists. But is it not strange that the law gives two different dispositions in the same form? MR. LASH-It is the legal title that is involved. The endorsement gives a mere equitable right. The law cannot decide between them except on the principle that where rights conflict, the legal title must prevail. A MEMBER-Is it impossible to devise something by which this difficulty about certificates can be got over? MR. LASH-Quite possible, if the Company were willing to pass a by-law voiding transfers unless the certificates were produced. Then, unless some form were gone through to account for its not being surrendered, the transfer would not be complete without the return of the certificate. But when neither the charter nor the by-law of the Company has placed that safeguard, then the courts have held that the Company can waive that. A MEMBER-I would like to ask Mr. Lash whether if a judgment creditor of a registered holder of shares attached them in the hands of the Company the attachment would hold against a transfer endorsed on the certificate. MR. LASH-Not where the English rules of law prevail. The sheriff can seize and sell only the actual existing interest of the defendant, not what he appears to own but what he does own. He appears on the books of the Company to own these shares, but, as a matter of fact, he has transferred them by an equitable assignment to somebody else, and, therefore, he appears as trustee in the books of the Company. The sheriff may seize and sell them, but as a matter of fact, anyone buying shares under an Ontario execution takes his chance about the title. If it turn out that the debtor had previously transferred them, then the purchaser would only acquire any right the debtor might have to redeem those shares. A MEMBER-Supposing a case where a transfer of shares was floating around for a year, the Company pays dividends on them to the ostensible holder, and a claimant notifies them he owns those shares and claims the dividends? MR. LASH-If the Company has been notified, those dividends were not properly paid, but if not it is a question only between the ostensible holder and the transferee. It was moved by MR. D. COULSON and seconded by MR. REID, and resolved, that the thanks of the Association be given to Mr. Lash for his able paper, and that he be requested to permit the paper to be published in the JOURNAL of the Association. The meeting then adjourned. SECOND DAY The meeting was convened at noon. ELECTION OF OFFICERS On motion of MR. WILKIE, seconded by MR. WALKER, the President was requested to cast one ballot for the election of the following officers for the ensuing year: PRESIDENT E. S. Clouston, General Manager Bank of Montreal VICE-PRESIDENTS Thos. McDougall, General Manager Quebec Bank. Geo. A. Schofield, General Manager Bank of New Brunswick EXECUTIVE COUNCIL B. E. Walker, General Manager Canadian Bank of Commerce D. R. Wilkie, General Manager Imperial Bank of Canada J. Turnbull, Cashier Bank of Hamilton. H. S. Strathy, General Manager Traders Bank of Canada G. Gillespie, Superintendent and Inspector of Branches Bank of British Columbia R. D. Gamble, General Manager Dominion Bank E. E. Webb, General Manager Union Bank of Canada EDITING COMMITTEE J. H. Plummer, Ass't Gen'l Manager Canadian Bank of Com merce J. Henderson, Inspector Bank of Toronto E. Hay, Inspector Imperial Bank of Canada BANK MONEY ORDERS MR. CHARLES again brought up the question of bank money orders, urging strongly that the banks should meet the rates given by the express companies for the smaller amounts. this he was supported by Mr. O'Grady, and after a lengthy discussion In It was moved by MR. O'GRADY and seconded by MR. CHARLES that the Executive Council be requested to consider the advisability of reducing the rates charged for bank money orders, in order to conform more closely to the express money orders. Carried. REDEMPTION OF CIRCULATION MR. O'GRADY-Just one word before proceeding to other business. Can you give me an answer to this question of circulation, respecting the propriety of our being burdened with. express charges for the transfer of circulation paid out at points where the issuing bank has not an office? We are not much troubled that way at present, but when the circulation begins to go down we will feel it. MR. MCDOUGALL-I think the law provides for the redemption of circulation at certain points. You may call it unnatural, but it is confirmed by the Government. It costs you as you know, but you have to put the thick with the thin. MR. O'GRADY-If I circulate a note at my office I must redeem it at my office. MR. COULSON-A bank might be asked to redeem the notes of another bank issued by it, but the law would have to be changed. MR. HAGUE-What would a bank do that was paying out notes of another bank? MR. O'GRADY-Simply redeem them. MR. COULSON-I think they should act as a redeeming agent. But it might mean that every bank would have to make an arrangement with every other bank and with its agencies. MR. O'GRADY—I think not. It would involve your making arrangements with a bank at Woodstock, for instance, to redeem your circulation, if the branch there was issuing it, but only while they are issuing it. I only object to a customer presenting a cheque in a bank and being handed out a bundle of notes whose redemption is refused when they are brought back to that bank. MR. WHITE-In our town one of the banks is now circulating the notes of another bank and they tell us they will redeem them at par. MR. O'GRADY-I think it is a very reasonable arrangement. We cannot object to their circulation, but during the time in which they are being paid out, the bank paying them out should redeem them, otherwise the remaining banks are at a disadvantage. MR. STRATHY-I do not see why they should not redeem the notes as long as they continue to issue them. MR. WALKER-It seems to be a question of etiquette. It may not be possible to make a regulation, but I think this Association might give an expression of opinion that when a bank pays the bills of another bank regularly across its counter, the bank paying them out ought to redeem them. We cannot get at it in a legal way, but I think we might agree that it is unfair. MR. MCDOUGALL-This expression of opinion is accepted by the Association. PROTECTION FROM BURGLARY Sir Charles Forrest introduced the subject of protection from burglary, advocating the formation of a fund for the following up of burglars, and after a full discussion It was moved by SIR CHARLES FORREST, that the Executive Council of the Canadian Bankers' Association be asked to take into consideration the proposal for a special fund for the following up of persons supposed to be interested in bank burglaries. Also that the Executive Council keep in touch with the American Bank Burglary Association in regard to the same question. The motion was seconded by MR. KESSON and carried unanimously. RESOLUTION OF THANKS TO THE PRESIDENT Mr. Wilkie-Mr. Macdougall has had a particularly anxious year as President, and I beg to move a vote of thanks to him for the admirable manner in which he has conducted the affairs of the Association during the past year. MR. HAGUE-I second this motion with very great pleasure. The duties of the President are very onerous, far more so than they were some years ago, and in Montreal it has been a particularly trying year. I am sure we are all very much obliged to Mr. McDougall. It has MR. MCDOUGALL-I am very grateful for your kind words. I have had a busy year, but it has done me much good. given me a great deal of experience which is always useful, and if the Association has benefited I am only too glad. The meeting then adjourned. |