1. A defendant, sued by a national bank for moneys it loaned
him, cannot set up as a bar that they exceeded in amount one-tenth
part of its capital stock actually paid in.
2. Where an agent, without authority, borrows moneys in the name
of his principal and the latter, when they have been applied to his
use and payment is demanded of him, fails within a reasonable time
thereafter to disavow the act of his agent, the jury is authorized
to consider the principal as assenting to what was done in his
name.
3. A juror in a civil action, who, on his
voire dire,
expresses an entire willingness as well as ability to accept the
facts as they shall be developed by the evidence and return a
verdict in accordance with them is not rendered incompetent by
having previously conversed with a person about the case and
received an impression in relation to the facts.
The facts are stated in the opinion of the Court.
Mr. JUSTICE HUNT delivered the opinion of the Court.
This was an action by the Rocky Mountain National Bank against
the Union Gold Mining Company of Colorado to recover
Page 96 U. S. 641
a balance of overdraft due upon the account kept at the bank in
the name of the company. The balance of overdraft, exceeding
$20,000, was created by drafts or checks drawn by one Sabin, who,
claiming to be the authorized agent of the company, acted in its
name and made deposits from time to time to its credit. The jury
rendered a verdict in favor of the bank for the amount of the
overdraft with interest ($30,358.32), and from the judgment entered
upon that verdict the present writ of error is brought.
The defendant presented formal requests to charge to the number
of forty, one of which was subdivided into three parts. It asked
for a new trial upon ten grounds severally set forth, and the
assignment of errors below discloses one hundred and thirty-three
allegations of error.
There was but a single question in the case, to-wit were the
acts of Sabin the acts of the gold mining company, either by
original authority or by ratification? As it was finally put to the
jury, was there a ratification of his acts by the company? We shall
consider the objections most seriously urged and having the greater
plausibility.
The first objection to the recovery arises from the amount of
the debt. The plaintiff is a national bank organized under the Act
of Congress of June 3, 1864, with a capital stock of $50,000. 13
Stat. 99. By the twenty-ninth section of that act, it is provided
as follows:
"The total liabilities to any association of any person or of
any company, corporation, or firm for money borrowed, including in
the liabilities of a company or firm the liabilities of the several
members thereof, shall at no time exceed one-tenth part of the
amount of the capital stock of such association actually paid
in."
Rev.Stat., sec. 5200.
After obtaining and holding to its own use the money, can the
mining company be allowed to interpose the plea that the bank had
no right to loan the money? In
Harris v.
Runnels, 12 How. 79, where the defendant sued upon
a note set up the illegality of its consideration, it was held that
the whole statute then in question must be examined to discover
whether it intended to prevent courts of justice from enforcing
contracts in relation to the act prohibited, and that when a
statute prohibits an act or annexes a penalty for its
commission,
Page 96 U. S. 642
it does not follow that the unlawfulness of the act was meant to
avoid a contract made in contravention of it. A statute provided
that slaves should not be brought into the state without a previous
certificate signed by two freeholders. Slaves were brought in
without such certificate and sold, and the purchaser was held
liable for the purchase money. Mr. Justice Wayne said that the rule
was allowed not for the benefit of either party to the illegal
contract, but altogether upon grounds of public policy.
In
O'Hare v. The Second National Bank of Titusville, 77
Pa.St 96, the question was made upon the statute we are
considering, and it was objected that the bank could not recover
the amount of the loans in excess of the proportion specified. The
court held that the section of the statute referred to was intended
as a rule for the government of the bank, and that the loan was not
void.
See also Pangborn v. Westlake,, 36 IA. 546;
Vining v. Bricker, 14 Ohio St. 331.
We do not think that public policy requires or that Congress
intended that an excess of loans beyond the proportion specified
should enable the borrower to avoid the payment of the money
actually received by him. This would be to injure the interests of
creditors, stockholders, and all who have an interest in the safety
and prosperity of the bank.
We are of the opinion that this objection is not well taken.
It is contended that there was error in admitting Perrin to sit
as a juror in the cause. It appears that he had previously
conversed with another party in relation to the facts of the case,
and had received from him an impression in relation to them. He
expressed an entire willingness, as well as an ability, to accept
the facts as they should be developed by the evidence, and to
render a verdict in accordance with them. He was evidently an
intelligent man and well qualified to act as a juror in such a
case. When his name was called, he was sworn to answer truly to
such questions as should be put to him touching his competency to
sit as a juror in the case. Questions were put to him by the
respective counsel, and were answered by him, the result of which
was as above stated. At the close of his examination, the record
states as follows,
viz.,
"By the court. Well, I think he is competent. Here the
defendant
Page 96 U. S. 643
challenged the juror Perrin for cause. The court denied the
challenge, and the defendant then and there excepted to the ruling
of the court."
It is not so stated in words, but it is assumed that thereupon
Perrin took his seat as a juror and acted as such during the trial.
The facts as stated by the juror do not justify a challenge for
cause in a civil action.
Rogers v. Rogers, 14 Wend. (N.Y.)
131;
Jackson v. The Commonwealth, 23 Gratt. (Va.) 919;
Freeman v. The People, 4 Den. (N.Y.) 9;
Lowenberg v.
People, 5 Park.Cr. (N.Y.) 414;
Sanchez v. The People,
22 N.Y. 147.
The decision of the challenge was submitted to the judge, and we
see no just cause of complaint in his decision.
Numerous objections were made to the admission and rejection of
evidence which do not require consideration. We refer only to the
objection to the statements or admissions of Becker, the president
of the mining company. These were made at various times at Colorado
and at New York.
The defendant was a mining company organized under the laws of
the State of New York, but whose mines and whose business (so far
as it had any) were in Colorado. Sabin leased a part of their mines
and professed to carry on another portion of them on account of the
company, and to borrow the money for its use in that business.
Becker spent much time in Colorado in attending to the company's
business there, and, omitting the questionable position of Sabin,
he was the only representative in that region.
The effort of the plaintiff on the trial was to show an original
authority in Sabin to draw checks in the name of the company and,
failing in that, to establish a ratification of his acts by which
the company would be chargeable. To this end, the knowledge of
Becker of what was done by Sabin, and his action in relation
thereto, were given in evidence.
The effect of this evidence and of the objections thereto is
much diminished by the charge given by the judge that the jury
might assume that, prior to the 16th of December, 1868, Sabin had
no authority to borrow money in its name, but that it was competent
for the defendant to ratify the acts and assume the indebtedness
created in its name. He further charged them that if Sabin was its
agent and borrowed money in its name
Page 96 U. S. 644
which was expended in the defendant's business, and the payment
thereof was demanded of the defendant, they were to consider
whether the defendant, with knowledge of the fact, assented to such
demand and approved the act of Sabin in obtaining the money; that
if acts have been done by an agent in excess of his authority, and
the principal on being informed of them fails to disavow them in a
reasonable time, his silence may be considered as an acquiescence
in and an assent to the acts done.
On the 16th of December, 1868, Becker, the president, closed up
the accounts of the company with Sabin and paid him the balance due
to him. Sabin's books and the bank books were then present, and
Becker knew the amount of the indebtedness which had then been
incurred by Sabin to the bank in the name of the company. This
settlement was in the presence of the cashier of the bank, and made
by his aid. This was clear and distinct notice to Becker of the
action of this agent of his company in its name. Becker, as
president of the company, was the suitable man to receive the
information, and what he said and did about it, and what action in
repudiating the doings of Sabin was taken by the company, or
whether there was no disavowal, might well be learned from its
chief officer.
Potter and Kountze were officers of the bank, and their
conversations with Becker were of a similar character.
The court expressly informed the jury that these conversations
were allowed for the purpose of showing Becker's knowledge of the
indebtedness and the demand upon him for its payment, and not for
the purpose of showing a promise on the part of the defendant.
We see no error in this branch of the case.
The judge's charge on the subject of the ratification by the
company of the acts of Sabin contained all that it was necessary to
say to the jury. It was in substance that if Sabin was the agent of
the company in working its mines in Colorado in 1867 and 1868,
without authority to borrow money in its name, but did in fact
borrow large sums of the plaintiff in its name, if, on the 16th of
December, 1868, the president of the company was informed of such
borrowing and of the amounts, and a
Page 96 U. S. 645
demand was made for the payment thereof, and if within a
reasonable time thereafter the company failed to disavow the acts
of its agent in so borrowing the money, the jury would be
authorized to consider the company as assenting to what was done in
its name. We consider this charge entirely correct.
Vianna v.
Barclay, 3 Cow. (N.Y.) 281;
Hazard v. Spear, 4 Keyes
(N.Y.) 469;
Cairnes v. Bleecker, 12 Johns. (N.Y.) 300.
Judgment affirmed.