Whitney v. Butler - 118 U.S. 655 (1886)
U.S. Supreme Court
Whitney v. Butler, 118 U.S. 655 (1886)
Whitney v. Butler
Argued October 12, 1886
Decided November 1, 1886
118 U.S. 655
A, an owner of shares in the capital stock of a national bank, employed a broker and auctioneer to sell them by public auction. They were bid off by B, who paid the auctioneer for them and received from him the certificate of stock, with a power of attorney for transfer duly executed in
blank. The auctioneer paid the purchase money to A. B was employed by the president of the bank to make this purchase for a customer of the bank, who had made a deposit in the bank for the purpose, and he delivered the certificate and the power of attorney to the president, and received from the bank the money for the purchase. No formal transfer of the stock was made on the transfer book of the bank. Shortly afterwards, the bank became insolvent, and eventually went into the hands of a receiver, who made an assessment on the stockholders under the provisions of Rev.Stat. § 5205, to make up the deficiency in the capital. Until after the stoppage, A had no knowledge as to the purchaser or as to the neglect to formally transfer the stock, and no reason to suppose that the transfer had not been made. In an action against A by the receiver to recover the amount of the assessment upon his said stock, held that the responsibility of A ceased upon the surrender of the certificates to the bank and the delivery to its president of a power of attorney sufficient to effect, and intended to effect, as the president knew, a transfer of the stock on the books of the bank.
This, like the case last reported, was an action at law by the receiver of the Pacific National Bank of Boston against an alleged stockholder in that bank to recover an assessment on his stock. The facts in relation to the failure of the bank and the imposition of the assessment by the receiver are the same as those reported in the last case. The material facts upon which the defendant relied to escape liability under the assessment were contained in the "Agreed facts" set forth or referred to in the opinion of the Court.