Case, Receiver of Crescent City Nat. Bank, v. Citizens' Bank of Louisiana.

holder for value, within the recognized principles of the law-merchant. The presence, then, in the contract under which the note was indorsed and delivered to the bank of an additional consideration the payment in advance of usurious interest which the law declares to be vicious and illegal, ought not to destroy the entire contract of indorsement when there is a sufficient consideration, aside from the usury paid, upon which it may rest.

We are of opinion that no error of law was committed by the court below, and the judgment should be affirmed.

It is so ordered.

CASE, Receiver of Crescent City National Bank, v. CITIZENS' BANK OF LOUISIANA.

(100 U. S. 446.)

Transfer of stock — refusal of cashier to permit ·

judgment for damages.

limitation - payment of

B. having duly sold stock of a National bank of Louisiana pledged to him by A., applied to the cashier to have it transferred on the bank books, but the cashier refused, on the ground that A. was indebted to the bank. The bank having failed before the transfer could be enforced, B. brought an action of damages against the receiver. Held, (1) that the action was not barred by the statute of limitation of one year; (2) the cashier having been intrusted by the directors with the duty of transferring the stock of the bank, his refusal was imputable to the bank; (3) the court below had power to order the receiver to pay the claim, or certify it to the Comptroller.*

ERROR

RROR to the Circuit Court of the United States for the District of Louisiana. The opinion states the case.

CLIFFORD, J. Associations formed under the act to provide a National currency are required to enter into articles of agreement specifying the object of the association, and the articles may contain other regulations, not inconsistent with the act, which the association may see fit to adopt for the conduct of their business and affairs. Such an association may make contracts, sue and

See Thomp. N. B. Cas. 276.

Case, Receiver of Crescent City Nat. Bank, v. Citizens' Bank of Louisiana,

be sued, and complain and defend in any court of law or equity, as fully as natural persons. They may also elect directors, and the board of directors may appoint a president, vice-president, cashier, and other officers, and define their duties. 13 Stat. at Large, 101; Rev. Stats., § 5136; Knight v. Bank, 3 Cliff. 429,

431.

Sufficient appears to show that the plaintiff bank discounted for the firm named in the transcript their promissory note in the sum of $20,000, payable to the order of the bank in thirty days, and that the promisors, to insure the payment of the note, pledged to the holders two hundred and twenty shares of the capital stock of the bank of which the defendant is the receiver, part standing in the name of the debtor firm and part in the name of their senior partner. Authority was given to the pledgees, at the time the stock was pledged, in case the note was not paid at maturity. to sell the shares pledged at public or private sale, the pledgors agreeing to sign all required transfers of the same necessary in the premises.

Payment of the note when it fell due was refused, and the pledgees of the stock having found purchasers for the same at the rate specified in the declaration, requested the bank, of which the defendant is the receiver, for permission to transfer the stock to the purchasers of the same, and the charge is that the bank peremptorily refused the request, on the ground that the promisors of the note were indebted to the bank and that their stock could not be transferred before payment of their indebtedness.

Nothing appears to show when the indebtedness of the pledgors of the stock was contracted to the defendant bank, but it is not alleged that it preceded the pledge of the stock, nor is it claimed. that the defendant bank had any lien on the stock for the payment of the alleged indebtedness.

Process was served and the defendant bank appeared and filed a peremptory exception to the declaration (1) Because the supposed cause of action did not accrue within one year next before the commencement of the suit. (2) Because the petition or declaration does not disclose any cause of action against the defendant.

Case, Receiver of Crescent City Nat. Bank, v. Citizens' Bank of Louisiana. Hearing was had and the court overruled the exception. Proceedings now unimportant followed, when the defendant again appeared and filed an answer, denying all the material allegations of the petition. Issue being joined, the parties went to trial and the verdict and judgment were in favor of the plaintiff, and the defendant excepted and sued out the present writ of

error.

Since the cause was entered here errors have been assigned to the effect following: (1) That the Circuit Court erred in holding and instructing the jury that the action arose ex contractu, and that it was not prescribed by one year. (2) That the Circuit Court. erred in instructing the jury that the defendant was liable for the refusal of the cashier to permit the stock to be transferred. (3) That the Circuit Court erred in refusing the two prayers for instruction presented by the defendant. (4) That the Circuit Court erred in ordering the receiver to pay the amount of the judgment or to certify the same to the Comptroller.

By-laws were adopted by the defendant bank, which provide that the stock of the bank shall be assignable only on the books of the bank, subject to the provisions and restrictions of the act of Congress, and that a transfer book shall be kept in which all the assignments of stock shall be made. Certificates of stock signed by the president and cashier may, as the by-laws provide, be issued to stockholders, but the requirement is that the certificate shall state upon the face thereof that the stock is transferable only upon the books of the bank, the further requirement being that when stock is transferred the existing certificates shall be cancelled and returned and that new ones shall be issued.

1. Provision is made by the Code of the State that persons are responsible for the damage they occasion, not merely by their acts but by their negligence, their imprudence, and their want of skill, which is not different in its application to this case from the rule which prevails at common law. Rev. Code La., art. 2315 and

2316.

Whenever an agent violates his duties or obligation to his principal, and loss ensues to the principal, he is responsible therefor, VOL II. - 7.

Case, Receiver of Crescent City Nat. Bank, v. Citizens' Bank of Louisiana.

says Judge STORY, and is bound to make a full indemnity. Story on Agency (6th ed.), § 217, a.

Actions for injurious words, whether verbal or written, and those for damages caused by animals, or resulting from offenses, or quasi offenses, are prescribed by one year in the jurisprudence of the State. Rev. Code La., § 3536. And the first proposition. of the defendant is that the Circuit Court erred in holding that the action in this case was not barred by that article of the Code. Causes of action resulting from offenses or quasi offenses are barred by the lapse of one year, and the defendant bank contends that the cause of action set forth in the petition in this case falls within the one or the other of those designations. Argument to show that it was not an offense is certainly unnecessary, as the proposition, if made, would be wholly without merit, from which it follows that the theory must be wholly rejected, unless the act for which the damages are claimed in this case can properly be regarded as a quasi offense within the meaning of that provision.

Even suppose the terms of the provision apply to such a cause of action, it is by no means certain that the admission, if made, would benefit the defendant, as the Supreme Court of the State has decided that prescription in respect to a promissory note is interrupted so long as the holder is in possession of collaterals pledged by the maker to secure its payment. Blanc v. Hertzog, 23 La. Ann. 199.

Stocks pledged as security for a loan, the same court holds, constitute a standing acknowledgment of the debt which interrupts prescription during the time the securities pledged remain in the possession of the creditor. Police Jury v. Duralde, 22 La. Ann. 107; Bank v. Knapp, id. 117.

Suppose, however, the claim for damages resulting from the refusal of the bank to transfer the stock must be considered as a cause of action wholly distinct from the note and the collaterals, then it becomes necessary to examine the objections taken by the plaintiff bank to the validity of the defense of prescription. Coming to that defense the plaintiff bank contends that the cause of action does not fall within the rule of prescription by the lapse of a year, because the act which gives rise to the claim was neither

Case, Receiver of Crescent City Nat. Bank, v. Citizens' Bank of Louisiana.

an offense nor a quasi offense within the meaning of that article of the Revised Code. Precisely the same question was presented to the Supreme Court of the State and was decided by that court adversely to the views of the defendant. Campbell v. Miltenberger, 26 La. Ann. 72.

Compensation was claimed by the plaintiff in that case for damages occasioned by the defective and improper construction of a fence around his dwelling and premises by the defendant. The prescription of one year was pleaded, setting up the same article of the Code, but the court decided that the rule of prescription of one year only applied to cases arising from damages caused by the commission of an offense or quasi offense, and overruled the defense as inapplicable to the case.

Actions arising under the article referred to survive, in case of the death of the injured party, for the space of one year, in favor of the minor children and widow of the deceased. Rev. Code, art. 2315.

Personal actions are not in general prescribed in that State short of ten years, even when the creditor is present, nor short of twenty years if he be absent. Rev. Code, art. 3544.

Many decisions have been made in the State upon the subject, but a few of each of the classes in question will be sufficient to show that the act which gave rise to the cause of action in this case cannot be regarded either as an offense or quasi offense within the rules of decision adopted in that State. Willful trespass in cutting wood upon refusing to account for the same, when held to be prescribed by that provision. 25 La. Ann. 419.

another man's land and accused of the act, was Whitehead v. Dugan,

Where damages were claimed for the illegal and wrongful seizure of the defendant's property by virtue of an execution against another party, whereby much of the property was lost or destroyed, it was held that the claim for damages fell within the category of that rule. Lizarde v. Banking Co., 25 Ind. 414.

Claim for injuries occasioned by a railroad to individuals, or for the destruction of domestic animals, are held to fall within the same category as charges of quasi offenses. But the right to