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Hoyt v. Thompson

5 N.Y. 320 Court N.Y. English

Delivered by *Ruggles, C. J.

Contents

Majority

p. 301
Hoyt v. Thompson et al.

Headnote

Officers of corporations. — Poivers of receiver. — Champerty.
The president and cashier of a hank, unless authorized hy charter, have no power, by an instrument under seal, to assign its choses in action, as security for a pre-existing debt, without authority from the hoard of directors. An assignment hy the receiver of a foreign insolvent corporation, of its choses in action, in this state, enables the assignee to maintain actions for the recovery of the same, against the debtors, hy whom they are owing.
The receiver of an insolvent corporation may assign its choses in action, without using the name of the corporation, or the corporate seal.
A sale hy the receiver of a corporation is a judicial one, and passes a good title to the purchaser, notwithstanding an adverse possession hy a third party; the statute in relation to champerty does not apply to sucli a sale. Hoyt v, Thompson, 3 Sandf. 416 , reversed.
Appeal from tire general term of the Superior Court of the city of Hew York, where a decree, overruling the defendants’ demurrer to a bill in equity, had been reversed, and the hill dismissed, with costs. (Reported below, 3 Sandf. 416 .)
This was a hill in equity filed in the supreme court, hy the plaintiff, against Abraham G. Thompson, George B. Fisk, Digby Y. Bell, auditor-general, George B. Cooper, treasurer, and Gideon 0. Whittemore, secretary, of the state of Michigan, and the Long Island Railroad Company, to compel the defendant, Thompson, to assign to the plaintiff a bond' for $40,000, and certain' mortgages securing the same, given hy the Long Island Railroad Company to the Morris Canal and Banking Company, and for the páyment of the moneys, if any, received thereon hy Thompson and Fisk, or, for payment of the same by the railroad company to the plaintiff.
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*The bill charged, that in December 1824, the legislature of New Jersey passed an act to incorporate “ The Morris Canal and Banking Company,” with authority to construct a canal, in that state, and also to carry on the business of banking. The charter, which was set forth in the bill, provided, that the ^ business of the company should be managed by fifteen directors, who were required to choose a president from among themselves, and were authorized to appoint treasurers, collectors, cashiers and other officers and agents necessary for conducting the affairs of the company; it was silent in relation to the powers of the president and cashiers. That after constructing the canal, and carrying on the business of banking, until February 1837, the company became insolvent, in fact, and within the meaning of the statute of New Jersey, entitled “ an act to prevent frauds by incorporated companies,” passed the 16th February 1829; the 7th section of which declared void, as against creditors, all sales of the effects of an incorporated company, made by its officers or agents, after such company should become insolvent, or should suspend its ordinary business, for want of funds to carry on the same, or made in contemplation of insolvency; with a proviso, saving the rights of bond fide purchasers.
That in the course of the lawful dealings between the Morris Canal and Banking Company and the Long Island Railroad Company, the latter company became indebted to the Morris Canal and Banking Company in about the sum of $60,000. That on the 3d November 1839, the said railroad company, to secure that debt, executed to the Morris Canal and Banking Company, a mortgage, signed by George B. Fisk,- as president, upon certain engines, cars and other property of the company. That prior to the date last mentioned, the Morris Canal and Banking Company had become largely indebted to the state of Michigan, which indebtedness *liad been some time due, and remained unpaid, and
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the agent and officers of the state were informed of the insolvency of the company, and that it had suspended its ordinary banking business, for want of funds to carry on the same. That the treasurer of the state, in making efforts to get security for the debt, in 1840, caused a bill to be prepared against the said Morris Canal and Banking Company, with the view of filing the same in the court of chancery of Hew Jersey, which was sworn to by said treasurer on the 23d October 1840, wherein it was stated, that the said company had been insolvent since the first day of March 1840; that suits for the recovery of large debts were then pending against the said company, and that since such insolvency, the directors had transferred effects of the company to divers persons, and bodies politic and corporate, which transfers were contrary to the before-mentioned statute, and were void. That the said treasurer, notwithstanding his knowledge of those facts, and that the company had no right to transfer its effects, on the 9th December 1840, prevailed upon the executive officers (the president and cashier) of the company, without the knowledge, assent or approbation of a. majority of the directors, to assign, with other items of property, to the state of Michigan, as collateral security for the sum due to said state, the debt due from the Long Island Railroad Company to said Morris Canal and Banking Company, which had been, on that day, reduced to $40,000, together with the mortgage given to secure the payment thereof.
That on the 6th March 1841, the Long Island Railroad Company, as additional security for the said debt, executed to the Morris Canal and Banking Company, a mortgage upon the lands on which their road was built, and other real estate, in the counties of Queens and Suffolk, in the state of Hew York, which mortgage, on the 26th April 1841, was assigned by the said officers of the Morris Canal and Banking Company, without the
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authority of the directors thereof *(though the assignment fraudulently recited that it was made in pursuance of a resolution of the board of directors), to the state of Michigan, as further security for the debt due to that state.
That by an act of the legislature of Michigan, passed in February 1842, the auditor-general, state treasurer, and secretary of state, for the time being, were made trustees, to take charge of the property, &c., assigned to the state, with power to sell and convey the same. That on the 8th July 1842, the mortgage on the personal property of the Long Island Railroad Company was surrendered, and a new mortgage executed to the state of Michigan, upon the same property, to secure the debt. That in the spring of 1843, the defendant, Abraham G. Thompson, in behalf of himself and George B. Físk, both well knowing all the circumstances before mentioned, purchased the debt against the Long Island Railroad Company, and the securities therefor, for $20,000, and received an assignment thereof from the. state of Michigan. That Thompson subsequently surrendered the mortgage upon the movables of the company, and received a new mortgage thereof to himself, for the debt and interest, with the bond of the company to him for the principal debt of $40,000; and afterwards, before the commencement of this suit, received some payments upon the principal and arrears of interest of the debt.
That on the 12th May 1841, Abraham Richards and David Selden recovered a judgment in the supreme court of New Jersey, for upwards of $30,000, and subsequently recovered and obtained by assignments, other large judgments, against the Morris Canal and Banking Company. That near the close of the year 1841, they filed their bill in the court of chancery of New Jersey, against said company, alleging its insolvency, and praying for the appointment of a receiver, in pursuance of the act of 16th February 1829, which authorized that
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court to appoint a receiver or receivers or trustees of an insolvent corporation, with, power to take into their possession “all the goods and chattels, rights and ^credits, moneys and effects, lands and tenements, books, papers, choses in action, bills, notes, and property of every description, belonging to the company at the time of its insolvency or suspension of business, and to sell, convey or assign all the said real or personal estate.” That in January 1842, a decree was made in that suit, appointing receivers, with the powers specified in the statute. That the receivers did not, until a considerable time after their appointment, ascertain that the state of Michigan had obtained the said mortgages, and they had no notice of the intention of the state to sell them, or of the proceedings in that respect.
That the plaintiff in this suit, in December 1844, purchased of Richards and Selden their judgments against the Morris Canal and Banking Company, and took a conveyance of the same to S. Sanxay, the plaintiff being, at that time, one-quarter owner thereof; that subsequently, he became the sole owner, and Sanxay conveyed to him. That the receivers, in November 1845, by order of the court of chancery of New .Jersey, in part payment of the said judgments, assigned to Sanxay the debt against the Long Island Railroad Company, herein-before referred to, and that Sanxay assigned the same to the plaintiff.
That the plaintiff applied to Thompson and Pislc, and the railroad company, and requested them to account to him for said debt, securities and interest, or for the products thereof, amounting in the whole to about $65,000, which they refused to do. He, therefore, prayed that Thompson might be decreed to assign to him the bond and the mortgages taken for the debt of $40,000, and interest, and that he, or. Fisk, or both, should nay to the plaintiff, all the money received by them on account of such debt and interest; and if the securities had been
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parted with, should pay the value thereof with interest; or that the Long Island Railroad Company should account to him for the $40,000, and interest.
The defendants, Thompson, Fisk, and the Long Island Railroad Company demurred to the bill, for want of equity, and for multifariousness. The supreme court, at special term (ILurlbut, J.), overruled the demurrer, v ith leave to answer; a rehearing was granted, and the cause subsequently transferred to the Superior Court, where the decree was reversed, and the plaintiff’s bill dismissed, with costs; whereupon, he took this appeal.
Evarts, for the appellant.
Beardsley, for the respondents.

The bill contains distinct averments, in relation to both the assignments to the state of Michigan of the debt against the Long Island Railroad Company — that they were made by the president and cashier of the Morris Canal and Banking Company, without the authority of the directors of that company. In regard to the first assignment, which bears date December 9th, 1840, the allegation is, that the agent of the state of Michigan prevailed upon the executive officers of the Morris Canal and Banking Company, ^without the knowledge, assent or approbation of a majority of the directors of that company, to agree to assign that debt, and that the said executive officers, that is to say, the president and cashier of that company, executed the assignment. And in a subsequent paragraph, the plaintiff avers in his bill, that the president and cashier held possession of the assets and property described in the agreement, without any express or implied right' to dispose of the game, or part with the possession thereof, without the

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assent of the Morris Canal and Banking Company, or the persons properly vested with the same — which assent was never given, nor in any way obtained. In relation to the assignment of the second or additional mortgage, the allegation in the bill is, that said mortgage was, on the 26th day of April 1841, assigned to the state of Michigan, by the said officers of the Morris Canal and Banldng Company, as a further security for the debt due to the state of Michigan, without the authority of the directors thereof — although the said assignment fraudulently represents that the same was made in pursuance of a resolution of the board of directors of said company.

Laying out of the question everything in relation to the insolvency of the company, when the assignments were made, they are represented by the bill to be the acts of the president and cashier, without the authority of the directors. This is admitted by the demurrer, and thus the naked qtiestion is presented to us, whether the president and cashier of the Morris Canal and Banking-Company could, of their own will, and without the authority or consent of the board of directors, dispose of the property of the corporation.

The president and cashier, and other executive agents of a corporation, are sometimes permitted by the directors, without express authority, to do acts, not within the sphere of their official duties or agencies, and arc thus held out to the public as having authority to do such acts. In such case, the corporation will b.e bound by the acts of its agents, on the ground of implied authority; hut upon the hill and demurrer in the *present case, all idea of implied authority is effectually excluded. The bill alleges that the president and cashier had no authority from the directors to execute the assignments, and the demurrer admits it, and unless the charter of the corporation gave-authority to the president and cashier to make the

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assignments, without the knowledge and assent of the directors, they were made without authority. I do not understand, from the opinion delivered in the superior court, that it was there supposed, that these officers had power, virtute offieii, to execute the assignments in question, and it is very clear, they had not.

The charter of the Morris Canal and Banking Company is made part of the bill. By its third section, the management of the concerns of the company was vested in fifteen directors, to be selected from the stockholders, and the directors were-to choose a president from among themselves. The 8th section gives to the president and directors, or a majority of them, the power to elect all engineers, treasurers, collectors, cashiers, toll-men, clerks, agents, &c., necessary, in their judgment, for conducting the affairs of the company.

But the powers and duties of the president and cashier are not prescribed by the charter; no power is conferred upon them to mortgage, assign or dispose of the property of the corporation. This is a part of the management of the concerns of the company, which is confided expressly to the directors, but not to the president and cashier. In no case, has it been held, that these officers have the power.to do an act like that in question, with-' out the assent and authority of the directors.[1] In Leggett v. New Jersey Manufacturing and Banking Company (Saxton Ch. 542), it was held, that a mortgage of real estate, executed by them, under the corporate seal, but without the authority ©r concurrence of the board of directors, was not a valid instrument. The management of the concerns of that company was committed, as in the present case, to a board of directors, and the powers

1 The president and cashier have no power to hind the bank, except in the discharge of their ordinary duties; they cannot bind it, by an agreement that the indorser of a note shall not be liable on his indorsement. Bank of United States v. Dunn, 6 Pet. 51 ; Bank of the Metropolis v. Jones, 8 Ibid 12; Bank of Whitehall v. Tisdale, 18 Hun 151 .

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of the president and cashier do not appear to have been defined by the charter. The value *of the property which the president and cashier undertook to assign to the state of Michigan, amounted to $40,000; the securities were not negotiable, and it was necessary that the transfer should be made under the common seal of the corporation.

In Massachusetts, it has been held, that neither the president nor the cashier of a bank has the power, in virtue of his office, to transfer the negotiable funds of the hank, without express authority from the directors. This, however, must be erroneous, if the transfer be made in the usual course of business, and in good faith. But it is safe to say, that when the sale, assignment or transfer of the property of the corporation requires the use of the common seal, it cannot be made, without the assent and authority of the hoard. A great proportion of the failures and bankruptcies of corporations, and of the frauds committed by them upon those who have dealt with them, have resulted from the usurpation, by their executive officers, of the powers which, by the charters, are intrusted to the directors; and although, in many cases, the corporations have been held bound by such acts, this has been on the ground that these officers have been permitted by the directors to take the entire management into their own hands, and thus held out to the public as authorized agents for that purpose; or, on the ground of subsequent ratification of the act, and that such ratification is equal to an original authority. Upon the pleadings in-this case, there is no room for implying an authority on either of these suppositions.

A deed, formally executed under the corporate seal, bears upon its face the presumption that it was executed by competent authority from the corporation; but this presumption may he repelled, and the deed avoided, by showing that the seal was affixed without authority. The assignments in question to the state of Michigan,.

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upon the facts shown, are not voidable merely; but absolutely void. They appear, on their face, to convey a title; but on the facts stated and admitted, they convey nothing; and without reference to the insolvency COTPora^on> their validity may be impeached by the corporation itself; or, in connection with such insolvency, by its creditors, directly or collaterally, and with the same effect as if they had been forgeries; and whether the state of Michigan was a bona fide purchaser of the debt and securities, or not, makes no difference. The assignments not being the acts of the corporation, the state acquired no title; the case stands on the same footing as if the assignments had never been made. Thompson acquired nothing from Michigan, because the latter had nothing to give; the Morris Canal and Banking Company remained the owners of the debt in question.

The next inquiry will be, whether the plaintiff, under the laws of New Jersey, acquired a title to the debt due from the Long Island Railroad Company to the Morris Canal and Banking Company. The plaintiff, in his bill, sets forth the statute of New Jersey, passed in February 1829, by which it is declared to be unlawful for incorporated companies, after becoming insolvent, or suspending their ordinary business for want of funds, to make any sale, conveyance, assignment or transfer of any of their property or effects. And by which the court of chancery of that state is authorized to restrain them from so doing, by injunction, and “ to appoint a receiver or receivers, or three trustees, ■ with full power and authority to demand, sue for, collect and receive, and take into their possession, all the goods and chattels, rights and credits, moneys and effects, lands and tenements, books, papers, choses in action, bills, notes, and property of every description whatever, belonging to the said company, at the time ot .their insolvency or sus

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pension of business as aforesaid; and to sell, convey and assign all the said real and personal estate,” &c.

The plaintiff avers, that Richards and Selden, being judgment-creditors of the Morris Canal Company, in New Jersey, filed- their bill against that company, in the court of chancery of that state, alleging its insolvency; and in January 1842, obtained a decree for an injunction, and for the appointment *of receivers of its property. The decree is set. forth in the bill, showing the appointment of three receivers, with the powers enumerated in the statute. He further avers, that the receivers, on or about the 13th of November 1845, by order of the said court of chancery, duly and properly obtained and entered, assigned the debt now in controversy, due from the Long Island Railroad Company to'the Morris Canal and Banking Company, to Skeffington Sanxay, who, having held the same as the agent and trustee of the plaintiff, afterwards assigned the same to him. This is the plaintiff’s title.

Against its validity, it is objected, on the part of the defendants: First, That it had been assigned to the state of Michigan by the Morris Canal Company, before the time, when, in the bill filed by Richards and Selden, that company was alleged to have become insolvent; and therefore, that the receivers appointed in that suit have neither title in themselves, nor authority to assign it' to the complainant in this suit. Blit if I am right in the view taken of the conveyance to Michigan, this objection fails, on the ground that no title passed to that state; and that the Morris Canal and Banking Company remained the owners of this property, when the bill of Richards and Selden was filed.

A further objection made to the plaintiff’s title is, that the property of the insolvent corporation was not vested in the receivers by force of the statute; but that they were created the agents of the company, and substituted in the place of the directors, for the purpose of settling

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its affairs. And secondly, as a consequence of their proposition, that the receivers cannot sell or dispose of the property in their own name, but must convey it in the name and under the common seal of the corporation; and we are referred to the case of Willink v. Morris Canal and Banking Company (3 Green Ch. 400), as an authority for those propositions.

It is true, that the chancellor of that state, in some observations not necessary to the decision of the question before him, said in that case, that the property of the corPora^on does *n0^ ves^ ^ie reGeiyers> and that they were substituted in the place of the directors, for the purpose of settling and closing the affairs of the company. But he said, at the same time, that a power was delegated to the receivers to take charge of the property and to sell it. This power is delegated by the statute, and not by the corporation; and the receivers are not appointed by the consent either of the directors or the stockholders. The chancellor does not say, and the case does not warrant the inference, that the receivers are to sell in the name of the corporation, or to use its common seal. There seems to be no more reason for using the name of the corporation, in selling its effects, than for a master in chancery, in selling lands under a mortgage, or a sheriff, in selling goods under execution; and a sale by the receivers, under the power delegated by the statute, is as effectual to convey the title, as if the right of property was vested in them. In one'case, they would convey their own title; in the other, they convey the title of the corporation. The sale is properly the act of the receivers, under the power conferred by statute, and not the act of the corporation. The acts of the receivers, therefore, need not be authenticated by the common seal; the directors may have melted it, or sunk it in the sea, and there is nothing in the statute to require its use by the receivers. The allegation in the bill, in relation to the assignment by the receivers, and their

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authority to assign, is sufficient, and should have been answered by the defendants.

But it is insisted, that the assignment by the receivers, in New Jersey, admitting it to he valid in that state, has no extra-territorial force, and does not operate in this state. Whether it would he valid as against creditors of the corporation, proceeding by attachment against it, in the state of New York, or as against previous purchasers of the corporation, are questions which do not arise on the record in this case. There is no conflict between the plaintiff’s title, on the one side, and attaching-creditors or purchasers, on the other side. We *have already seen, that upon the bill and demurrer, the defendants, who claim under the state of Michigan, are not clothed with the character of purchasers. The question, therefore, is, whether the plaintiff’s title, derived from the proceedings of the court of chancery, in the state of New Jersey, in pursuance of a statute of that state, is to be recognised by the courts of this state, as so far valid, that it may he enforced here against the Long Island Railroad Company.

If the defendants are right in their position, that the assignment to the complainant is inoperative in this state, because it was effected by operation of a law of New Jersey, and not by the voluntary act of the corporation, the consequence is, that although the debt against the Long Island Railroad Company belongs, in the state of New Jersey, to the plaintiff, it belongs, in this state, to the Morris Canal Company, and that that company must bring the action in this. state to recover it. But here a difficulty arises; the order appointing a receiver of the property of an insolvent corporation is accompanied by an injunction restraining the directors of the company from collecting its debts or paying over the avails; and this injunction is general, without reference to the state or country where the debtors may reside. The object of the proceeding in New Jersey is to take

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everything out of the hands of the corporation, and to put everything into the hands of the receiver. A suit by the corporation, for its own benefit, here, is a breach of the injunction in New Jersey, and the suit cannot be brought, without incurring the penalty.

But suppose, the corporation should sue in this state, notwithstanding the injunction in New Jersey, on what ground is it that a foreign corporation can maintain a suit here? The principle that the statutes of foreign states have no extra-territorial force here, if strictly applied, is as fatal to the action by the corporation, as it is to the action by the receiver’s assignee. The corporation is no less the creature of the statute of New Jersey, than is the transfer by the receivers to the plaintiff. ^ *s we^ se^e<^> a foreign corporation may sue in the courts of this state; and equally well settled, that such suit is allowed only by the comity existing between one state or country and another. (Bank of Augusta v. Earle, 13 Peters 590 -91.) But what kind of comity can that be called, which allows a foreign corporation to sue here, in violation of the law of the state in which it was created ? A corporation not allowed to sue in its own state, certainly cannot he allowed, by the friendly courtesy of another, to bring its action there. The comity which allows a foreign corporation to sue, in'ordinary cases, would forbid it in a case like the present. But can it he said, that the receiver’s assignee may bring his suit here, in the name of the corporation, for the benefit of the assignee ? Primd fade such a suit would be for the benefit of the insolvent corporation, and open to the objection above stated. This could not be removed, without showing the receiver’s assignment, and obtaining from the court here, a recognition of its validity; such a recognition would yield the entire principle, not only of the validity of the assignment, hut that, in a court of equity, the suit should be brought in the name of the real owner. The result

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is, that if this suit cannot be maintained, the debt against the Long Island Railroad Company cannot be collected.

It is a conceded principle, that the laws of a state have no force, proprio vigore, beyond its territorial limits.[2] But the laws of one state, are frequently permitted, by the courtesy of another, to operate in the latter, for the promotion of justice, where neither that state nor its citizens will suffer any inconvenience from the application of the foreign law. This courtesy or comity is established, not only from motives of respect for the laws and institutions of foreign countries, but from considerations of mutual utility and advantage. Until the decision of the case of Abraham v. Plestoro, in the court for the correction of errors ( 3 Wend. 538 ), it had been uniformly held in this state, that, in virtue of this comity, the assignees of a foreign bankrupt were entitled to sue for *and recover the debts due to the bankrupt within this state, except where the claim of the assignees came in conflict with creditors in this state, claiming under attachments against the bankrupt’s property. (Bird v. Pierpont, 1 Johns. 118 ; Bird v. Caritat,

2 The question debated in this ease came before the supreme court of the United States, in 1864, in the ease of Booth v. Clark, 17 How. 322 , that the title of an assignee in bankruptcy must prevail over that of a receiver, appointed on a creditor’s bill, as to assets in another jurisdiction. The court say (p. 338), that a receiver “ has no extra-territorial power of official action, none, which the court appointing him can confer, with authority to enable him to go into a foreign jurisdiction, to take possession of the debtor’s property ; none, which can give him, upon the principle of comity, a privilege, to sue in a foreign court, or another jurisdiction, as the judgment-creditor himself might have done, where Iris debtor may he amenable to the tribunal, winch the creditor may seek.” A receiver of an insolvent bank, appointed in another state, takes the assets in this sLate, subject to the claims of attaching-creditors, who have attached subsequently to the act of insolvency. Willitts v. Waite, 25 N. Y. 577 . It has been held, however, in Pennsylvania, that from the time of the appointment of a receiver of the estate of an insolvent debtor, under the insolvent laws of another state, the assets are in cus-todié legis, and that a debt owing to the insolvent was not liable to be attached in the hands of the debtor, in that state. Mulliken v. Aughinbaugh, 1 P. & W. 117 .

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2 Id. 342; Holmes v. Remsen, 4 Johns. Ch. 460 ; Holmes v. Remsen, 20 Johns. 229 , 267.) In some of these cases, full effect was given to a foreign assignment in bank-ruptey, without qualification. But in the case last mentioned, which was a case of English bankruptcy, the principle was stated, with the qualification in favor of American creditors. In that case, a learned and elaborate opinion was delivered by Mr. Justice Platt, in which he denied that the English statutory assignment in bankruptcy created a lien here, so as to deprive American creditors of their remedy by attachment under our laws, but fully admitted the right of those assignees to sue here, by virtue of the commission or authorization in England. (See page 267-8 of the case.) In the case of The New Jersey Lombard Bank v. Thorp ( 6 Cow. 46 ), the right of foreign assignees in bankruptcy to bring suits here was recognised; and trustees appointed by an act of the 'legislature of New Jersey, by which, the property of the corporation was vested in them, were allowed to sue here in their own names.[3]

The case of Abraham v. Plestoro, above referred to, is supposed by the defendants to have established, in its strictest sense, and without qualification, the doctrine that a foreign assignment in bankruptcy is absolutely inoperative and void in this state, but I think, this a mistake. The point there decided seems to be correctly stated in the reporter’s marginal note: it is this — “ that an assignee under a foreign commission of bankruptcy, is not entitled, before judgment, to an injunction to restrain the bankrupt from receiving property which was on the high seas, on its way from England to New York, at the time of suing out the commission.” The facts were, that Abraham, being largely indebted in

3 Though the right of a foreign assignee in bankruptcy must, as respects assets situate in the United States, yield to the claims of domestic creditors, yet such foreign assignee may maintain suits in our courts, to collect the assets of the bankrupt’s estate. Hunt v. Jackson, 5 Bl. C. C. 349 .

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England, left that country, bringing his property, or a considerable portion of it, *with him, to New York. A commission of bankruptcy was sued out against him in England, and a provisional assignment executed to James Johnston, who followed him to this country, and finding the property in the customhouse, filed a bill against Abraham and the customhouse officer, and obtained an injunction, restraining the collector of the customs from delivering the property to. Abraham, and forbidding the latter to receive it. Abraham, in his answer, denied that he absconded from England, or that he left there for the purpose of defrauding his creditors, and insisted, that the commission of bankruptcy had issued improvidently and illegally. A motion to dissolve the- injunction was denied by the chancellor, and Abraham appealed from that decision; the order of the chancellor was reversed, and the injunction dissolved: but on what ground, cannot well be ascertained from the report of the case. Two of the judges of the supreme court, and two senators, were in favor of affirming the chancellor’s order. ' Opinions in favor of reversal were delivered by Senators A llen, Maynard, Olivbk and Stebbins. Senator Allen put the case on several grounds, some of which have no application to the case now under consideration. One of the reasons given by Senator Maynard for reversal was, that the assignment to Johnson was provisional merely, and was still open to contestation by the bankrupt, and therefore, the cases holding that a foreign assignment operated as a transfer here, were inapplicable. Senator Oliver, in his opinion, says: “The question is not, whether a foreign assignee shall be permitted to sue in our courts; in relation to that there can be but one opinion. Had the proceedings in bankruptcy in this case been perfected, the bankrupt acquiescing in their justice and propriety, and the assignee been substituted in his place, and a question had arisen between him and
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a debtor of tbe estate, no one would have doubted or questioned the right of the assignee to sue in our courts; but that is not the case we are considering. The question here is, whether the comity of nations, or in other w01^s’ ^le lightened *and liberal principles of jurisprudence, require that we shall enforce the bankrupt law of a foreign nation, by giving effect to a statutory assignment, not merely by allowing the as-signee to sue in our courts, when the validity and legality of the assignment is not disputed; but by enforcing the harsh, rigorous and penal provisions of a bankrupt law, against the bankrupt himself, who denies that he is insolvent, and insists that if a commission of bankruptcy has issued against him (of which he professes his total ignorance), it has issued improvidently and illegally.” Senator Olivek puts the case on still other grounds, some of which affect the point we are considering, and others do not. Senator Stebbins, after denying that the foreign assignment wrought a change in the title here, denies also that the assignee was entitled to the injunction, even if he were the owner of the property.

It is impossible, therefore, to say, that the case of Abraham v. Plestoro was decided on grounds affecting the question now under consideration, It remains entirely uncertain, whether the decision turned upon the point that the foreign assignment was inoperative here; or, on the ground that although the assignee may sue the bankrupt’s debtor here, he cannot sue the bankrupt himself; or, on the ground that the assignment was provisional merely, and therefore imperfect; or, on the ground that a foreign assignee, before judgment, is not entitled to an injunction; or, on the question whether the proper remedy was not at law.[4]

4 A judicial assignment in insolvency, the effect of which is, hy the local law, to transfer to the assignee, all the debtor’s property, which ho himself could have lawfully assigned, passes the title to a ship at sea, as against a subsequent attachment issued by a court of another state. Crapo v. Kelly, *319 16 Wall. 610 ; reversing s. c. 45 N. Y. 86 . And see McDonald v. Mallory, 77 Ibid. 554

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I have not overlooked the case of Johnson v. Hunt ( 23 Wend. 87 ), in which a different view of the case of Abraham v. Plestoro was taken, and so far as the decision in that case was founded on that view, I feel myself compelled to dissent from it, and to adopt the principle T have quoted from the opinion of Mr. Justice Platt in Holmes v. Remsen; adopting, at the time, what is said by him and by Chief Justice TaNEY, in 13 Peters 590 , to the effect that, from the intimate political union, and the extensive commercial intercourse between the * American states, and from the similarity of their laws and institutions, we are called upon to encourage and establish a greater degree of comity and courtesy towards one another, than towards the nations of Europe, with whom such relations do not exist.

It is satisfactory, to know that the construction above given to the case of Abraham v. Plestoro, and my own conclusions upon the point now in question, are in conformity with the opinion expressed by Mr. Justice Stoey, in his treatise on the Conflict of Laws, §§ 419, 420, 421. In § 420, speaking on this question, he says, it is impossible not to feel that the general current of American authority is in favor of the assignees. “ In most of those cases in which assignments under foreign bankrupt laws have been denied to give a title against attaching-creditors, it has been distinctly admitted, that the assignees might maintain suits in our courts under such assignments, for the property of the bankrupt. This is avowed in the most unequivocal manner, in the leading cases in Pennsylvania and New York already cited, and it is silently admitted in those in Massachusetts. And unless the admission can be overthrown, it surrenders the principle; for no one will contend that the assignees

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can sue, either in law or equity, in our courts, unless they possess some title under the assignment.”

The case of Harrison v. Sterry ( 5 Cranch 312 ) presented only the question of preference between the assignees of a foreign bankrupt and attaching-creditors at home; and although the language of the court was general, that “ the bankrupt law of a foreign country is incapable of operating a legal transfer of property in the United States,” its meaning, as an authority, must be qualified by the facts to whieh it was applied.[5] It was unnecessary, for the purpose of that case, to state the qualification of the rule asserted; and for that reason, probably, it was omitted. It was well said by an English chancellor, that “ it is always unsatisfactory, to abstract altogether the reasoning of the court, in any reported case, *from the facts to which that reasoning is meant to apply; it has a tendency only to misrepresent one judge and to mislead another.” (2 Ball & Beatty 286.)

The only remaining question is, whether the assignment to the plaintiff, by the receiver in New Jersey, is void, by the common law of that state for champerty. It was thought in the court below, that under the terms of the statute already quoted, the receivers had no authority, expressed or implied, to sell any portion of the property of the company, which they had not reduced to possession. In this opinion, I am unable to concur. The power to sell is general; and by no means limited, by the terms of the statute, to property in the possession of the receivers; it extends to all the estate and effects previously enumerated, and by the generality of its words, embraces the choses in action, rights and credits of the corporation, whether the evidence of the ■ right to recover was in the possession of the receiver oi not.

5 But see Booth v. Clark, 17 How. 337 .

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The manifest object and policy of tlie statute forbids any otter construction. The design of it was, to take from the hands of the directors, upon the presumption of their having mismanaged their trust, every valuable thing belonging to the corporation, for the purpose of converting it into money, for the payment of debts. And the power of selling the choses in action, rights and credits of the corporation, was given for the benefit of creditors. Their interest requires that the affairs of insolvent corporations should be brought to a speedy conclusion, and that the delay consequent upon the slow process of collecting doubtful debts, and litigating contested claims, at the expense of the fund in the receiver’s hands, should be, so far as possible, avoided; in many cases, this can be best done by a sale. Among the many cases cited in the learned opinion of the superior court, not one is found, in which the doctrine of cham-perty has been applied to a case of this kind, or of the like nature; it does not apply to judicial sales of any description. In Tuttle v. Jackson ( 6 Wend. 224 ), the chancellor, who delivered the opinion in the court *for the correction of errors, declares, that the statutes against buying and selling pretended titles, cannot apply to judicial sales; and that the common law has never been considered as preventing the change of property, by operation of law, or by a sale by the proper officer, under a bond fide judgment or decree of a court having competent authority to order such sale. It does not come within the mischiefs intended to be guarded against by the statute.

The receiver’s sale, according to the allegations in the bill, was a judicial sale; and it would be treating the authorities of a sister state with great disrespect, to say, that a sale made by order of one of its highest courts, in a matter in which that court has jurisdiction, was made in violation of its own law. In this state, every species of property belonging to a debtor, may be

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reached, and applied to the payment of his debts, upon a judgment-creditor’s bill; and this may be done by a sale of the property. (Edmonston v. Lyde, 1 Paige 641 .) Such sale is free from all objection on the ground of champerty.

The decree made in the superior court, should be reversed, and the decree of the special term of the supreme court affirmed, with costs to the plaintiff of the appeal from the special term, but without costs of appeal to this court.

The ground upon which the decision of this cause was placed by the superior court, cannot, in my judgment, be sustained. The purchase of the debt due to the Morris Canal and Banking Company from the Long Island Railroad Company, by the plaintiff, did not involve the offence of either maintenance or cham-perty. It was a purchase of the whole demand, and the purchaser brought this suit, not to support or maintain the title of another, but to support and maintain his own title. The plaintiff entered into no agreement to maintain or assist another with money or otherwise, to prosecute or defend a suit in which he had *no interest; nor did he enter into an agreement to carry on a suit, at his own expense, in consideration of having a part of the matter sued for. (4 Bl. Com. 134-5; 2 Story Eq. § 1048, and §§ 1050 and 1053.) Since the adoption of the revised statutes, maintenance has not, under our laws, been recognised as an offence, and champerty only remains an offence in a qualified form. (Mott v. Small, 20 Wend. 221 -2; s. c. 22 Id. 405; 2 R. S. 691, §§ 5, 6, 7 and 8; 1. R. S. 739, § 148; 3 R. S. Appendix 828, Notes of Revisers, 2d ed.; 3 Cow. 643 to 649; 4 Wend. 310 .)

The statutory prohibition against buying a disputed title, is confined to real estate, which is the subject 'of controversy by suit, or which is not in the possession

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of the vendor. (2 R. S. 691, §§ 5 and 6, 1st ed.) All dioses in action, embracing demands which, are considered as matters of property or estate, are now assignable, either at law or in equity; nothing is excluded but mere personal torts which 'die with the party. A claim, therefore, for property fraudulently or tortiously taken or received, or wrongfully withheld, and even for an injury to either real or personal property, may be assigned. (Pe ople v. Tioga Common Pleas, 19 Wend. 73 .)

But the purchase of the plaintiff may be regarded as a purchase at a judicial sale; it was valid for that reason. The assignment of the debt of the Long Island Railroad Company to the plaintiff was made in part payment of his judgments against the Morris Canal and Banking Company, in pursuance of the order of the court of chancery of New Jersey. ( 6 Wend. 224 ; 5 Barb. 109 .) The principles of the common law and the statutes, in relation to champerty, do not apply to judicial sales, nor to sales made under a judgment, order or decree of a court having competent jurisdiction to order the sale. There are no allegations in the bill, in relation to the law of New Jersey, on the subject of maintenance and champerty; in the absence of all evidence to the contrary, the presumption is, that the law of New Jersey on this subject is the same as the law of New York.

*The plaintiff and defendants both claim under the Morris Canal and Banking Company. It is insisted, on the part of the plaintiff, that the defendants have no title to the debt of the Long Island Railroad Company, because — 1. The alleged assignment to the state of Michigan was not executed or authorized by the board of directors of the Morris Canal and Banking Company, but was made by the executive officers of the company, without any authority, and so known to be by the state of Michigan. 2. It was void, because made after the insolvency of the Morris Canal and Banking Company, with full notice of such insolvency

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on the part of the state of Michigan, and in fraud of the statute of New Jersey.

The plaintiff claims under an assignment from the receivers of the Morris Canal and Banking Company, appointed by the court of chancery of the state of New Jersey. A bill was filed by Richards and Selden, judgment-creditors of the Morris Canal and Banking Company, in the court of chancery of New Jersey, alleging the insolvency of the company, and praying for an injunction and receiver, under an act of that state of 1829, which provides that when an incorporated company becomes insolvent, it should not be lawful for the directors of the company to sell or assign any of its estate, &c., and authorizes the court, in a suit commenced by a judgment-creditor, after the insolvency of the company, to appoint receivers, &c., with full power to collect and take into their possession the debts, &c., and goods belonging to the company, at the time of its insolvency, and to sell the real and personal estate, and pay the proceeds into court, to be distributed under the'order of the court among the creditors of the company.

The statutes and laws of a country have no intrinsic extra-territorial force. They bind only its own citizens, and citizens of other countries while within its jurisdictional limits; and they bind directly only property within these limits. They do not affect or bind property out of its territory, or persons not resident therein, whether natural-born citizens or *others. Whatever extra-territorial force these statutes and laws are permitted to have, is the result of the voluntary consent of other nations; this consent is accorded, upon the principle of the comity of nations alone, and not from any international obligation to yield to such statutes and laws the slightest obedience. (Story on Confl. of Laws, §§ 7, 8,18, 20, 22, 23, 28, 38.) But no nation, on any recognised principles of comity, is morally or otherwise hound to enforce foreign laws prejudicial to its own

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rights or to the rights of its own snbj ects. (Story on Confi. of Laws, §§ 244,512.) Bankrupt and insolvent laws come within this class; they have no extra-territorial force or validity. Their enforcement, in any country other than that in which they were enacted, would be prejudicial to the rights of the citizens of such country. The states of the Union are regarded as foreign to each other, for all purposes not embraced in the constitution of the United States. (Woodhull v. Wagner, Bald. C. C. 296); and the bankrupt and insolvent laws of one state have no force or validity in any other state.

In this state, it has long been regarded as settled law, that a discharge obtained under an insolvent law of another state, is no bar to a suit here, commenced by a citizen of this state, for a debt contracted within it. (Van Raugh v. Van Arsdaln, 3 Caines 154 .) And under the decisions of .the supreme court of the United States, it must now be held, that a discharge under an insolvent law of this state, will not be a bar, even in this state, to an action on a contract made or debt contracted in another state, between parties residing there at the time; nor will it discharge a debt contracted within this state, by a citizen of the state, as against a creditor who i.s a citizen of another state. (Van Hook v. Whitlock, 26 Wend. 53 , in error, Nelson, C. J.; 3 Story Com. on Const. 256; Hicks v. Hotchkiss, 7 Johns. 312 ; 2 Kent Com. 393, and note; McMillan v. McNeill, 4 Wheat. 209 ; F. & M. Bank, &c., v. Smith, 6 Id. 131; Ogden v. Samders, 12 Id. 213; Braynard v. Marshall, 8 Pick. 196 .) Bankrupt and insolvent *laws of a foreign nation, or of a sister state, having no force here, statutory assignments made under the authority of these laws, are not recog-nised by our courts, as having any validity, or as affecting any property of the bankrupt or insolvent in this state.

Previously to the case of Abraham v. Plestero ( 3 Wend. 538 ), the law on this subject was, in this state, unsettled.

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Chancellor Kent had decided, that a statutory assignment, made under a foreign bankrupt law, passed to the assignees-of the bankrupt, his title to property in this state; but Justice Platt had expressed a contrary opinion. ( 4 Johns. Ch. 460 ; 20 Id. 254.) Since the decision, however, of that case, by the court of errors, and the decision in Johnson v. Hunt ( 23 Wend. 87 ), the doctrine that a statutory assignment under a bankrupt or insolvent law of a foreign nation, or sister state, does not operate a transfer of property in ■ this state, or of debts due by debtors residing within it, or by corporations chartered under its laws, and doing business within the limits of the state, may be regarded as settled law. A similar doctrine has been advanced and is now considered as an acknowledged rule of jurisprudence, by the supreme court of the United States, and by most of the state courts of the Union. (Harrison v. Sterry, 5 Cranch 289 ; Ogden v. Saunders, 12 Wheat. 213 ; Plestero v. Abraham, 1 Paige 236 ; Holmes v. Remsen, 20 Johns. 254 ; 2 Kent Com. 406-7.) The question has generally arisen between the foreign assignees in bankruptcy, and domestic creditors who had sued out an attachment against the personal property of the bankrupt, in the state where it was situated. But the principle is not confined to attaching-creditors, it embraces sales under judgment and execution; voluntary transfers by the debtor in satisfaction of claims of creditors, or to bona fide purchasers for a valuable consideration; and all other transfers of the property, or liens on the same, which are valid under the lex loci reí sitas. (Story on Confl. § 414; 20 Johns. 261 ; 23 Wend. 94 , 95, 99.)

If the statutory assignment under the foreign bankrupt or insolvent law does not transfer the property of the debtor in this state, to the foreign assignees, such property should be regarded as liable precisely to the same disposition, as it would have been had there been no such statutory assignment, and no

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proceedings under such, foreign bankrupt or insolvent law. The effect of the decisions in Abraham v. Plestero ( 3 Wend. 538 ) and in Johnson v. Hunt (23 Id. 89), is, to establish the absolute invalidity of the foreign statutory assignment, as it respects property in this state; not only as between the foreign assignees and domestic creditors, but also as between such assignees and creditors residing in the country under whose laws the assignment was made, and who are proceeding against the property, by attachment or otherwise, in our courts.

If the foreign statutory assignment is, as to both domestic and foreign creditors, and even as to all purposes, wholly inoperative as to the personal property of the debtor in this state, it would seem to be in harmony with this doctrine, to refuse to foreign assignees the privilege of maintaining suits, in their own names, in our courts for the recovery of debts due to the foreign bankrupt. A denial of this privilege to foreign assignees would place them on the footing of foreign executors and administrators, who have no right to maintain suits in our courts to recover debts due to their testator or intestate. (Story on Confl. §§ 512, 513.) Permitting foreign assignees to sue in their own names in our courts, is regarded by some distinguished jurists, as a recognition of some title in them under the assignment. (Story on Confl. § 420; 3 .Wend. 552.) But foreign assignees have heretofore only been allowed to maintain suits in their own names, as representatives of the bankrupt, and not as assignees having an interest; and they have only been allowed to gain a preference, by pursuing the remedies which our laws afford. (Holmes v. Remsen, 20 Johns. 259 .) Where neither the rights of-domestic creditors, nor of foreign creditors proceeding against the property under our laws, are involved, the foreign assignee may be permitted to sue in our courts, for the benefit *of all the creditors, on principles of national comity, without a surrender of the

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principle that a foreign statutory assignment does not operate a transfer of property in this state.[6] Allowing foreign assignees to sue in our courts, where neither the rights of our own citizens, nor the rights of foreign citizens pursuing the remedies afforded by our laws, will be prejudiced, may be regarded as a mere manifestation of respect for a foreign nation, accorded upon principles of national courtesy, and not as a concession that the assignment under which the assignees claim, has, under our laws, any force or validity in this state.

Voluntary assignments stand upon entirely different principles from involuntary legal assignments. A voluntary assignment has no relation to place; an involuntary legal assignment has the strictest relation to place. The latter, made under the legislative authority of a nation, can only operate upon property within its own territory; a voluntary conveyance by a party, made according to the law of his domicil, will pass his personal estate, whatever may be its locality; abroad as well as at home. (Story on Confl. § 411, 20 Johns. 258 ; 3 Wend. 566 .) The control of the owner of personal property has no respect to its locality; he can dispose of it wherever it may be; but the control which the law can exercise over property is limited to the territory of the government by which the law is enacted. This creates a solid distinction between a voluntary conveyance of the owner, and an involuntary conveyance by the mere authority of law. (Story on Confl. § 411; 23 Wend. 96 .)[7]

The statute of New Jersey, under which the receivers of tho Morris Canal and Banking Company were appointed, was clearly a statute in the nature of a bankrupt law. It was a general act relating to all incorporated companies, and was enacted to prevent frauds by such companies. It provides, that whenever an incorporated

6 See Blane v. Drummond, 1 Brock. C. C. 62.

7 Accordingly, it has been held, that a statutory assignment does not pass the'dobtor’s interest in a patent-right. Ashcroft v. Walworth, 1 Holmes 152 .

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company shall become insolvent, it shall not be lawful for any of its officers to sell or assign any of its real or personal estate; and also provides for *sequestration of all the property of such company, and for a statutory assignment or sale of the same, without its consent; and for a distribution of the proceeds of the sale of the property among the creditors of the company. The assumption, under this statute, of the disposition of the property of the insolvent company, is, in all respects, in invitvm, and by the mere authority of a legislative enactment.

The plaintiff’s claim to the debt of the Long Island Railroad Company is under the assignment of the receivers of the Morris Canal and Banking Company, appointed under the provisions of this act of the state of New Jersey. This assignment is nothing more than a statutory assignment; it is an involuntary legal conveyance, made by the mere authority of the law, without either the express or implied consent of the Morris Canal and Banking Company. It can only operate on the property of the company within the state of New Jersey; it cannot operate as a transfer of the debt of the Long Island Railroad Company, which has its locality in this state, it being a debt due by a corporation chartered by the state, and doing business within its jurisdictional limits. The statute of New Jersey being in the nature of a bankrupt law, has no force or validity in this state, either as it respects the citizens of this state or the state of Michigan. ( 12 Wheat. 213 ; 8 Pick. 196 ; 26 Wend. 53 .) The assignment, therefore, to the state of Michigan, if in other respects valid, is not void, because made in violation of that statute. This statute forms no part of the charter creating the Morris Canal and Banking Company ; it does not, therefore, form a part of the law of its existence. There is nothing in the charter of the company which prohibits the assignment to the state of Michigan of the debt due by the Long Island Railroad

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Company. The powers of the Morris Canal and Banking Company were derived from its charter ; under that charter, irrespective of the general act of New Jersey to prevent frauds by incorporated companies, the assignment to the state of Michigan, if duly authorized by the directors of the Morris Canal and Banking Company, was ail(^ va^(3- ( 13 Peters 587 .) But if the assignment to the plaintiff, by the receivers of the Morris Canal and Banking Company, is allowed to have any validity in this state, it cannot relate back beyond the time of the appointment of the receivers, or the filing of the bill by Bichards and Selden against the Morris Canal and Banking Company; and previously to that date, that company had assigned the debt in question to the state of Michigan. ( 4 Johns. Ch. 477 .)

But it is insisted on the part of the plaintiff, that the assignments to the state of Michigan were unauthorized by the directors of the Morris Canal and Banking Company. It is necessary to examine this objection; for if it is well founded, and the state of Michigan acquired no right or title to the debt in question, under their assignments, the plaintiff may, on the principles of international comity, be allowed, as the representative of the Morris Canal and Banking Company, or of its receivers, to maintain his suit for the recovery of the debt due by the Long Island Railroad Company, on the ground that there is no conflict between him and the creditors of the Morris Canal and Banking Company, or bond fide purchasers claiming under that company.

The plaintiff alleges in his bill, that the treasurer of the state of Michigan, notwithstanding his knowledge that the Morris Canal and Banking Company had no power to sell and assign any of its property and effects, prevailed on the executive officers of that company, without the knowledge, assent or approbation of the majority of the directors of the company, to assign the debt due by the Long Island Railroad Company to the

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state of Michigan, as a collateral security for a debt due to such state by the Morris Canal and Banking Company, and that such assignment was executed by the president and cashier of the latter company, under the common seal of such company. The bill also alleges that the said officers of the Morris Canal and Banking Company, on the 26th April 1841, assigned to the state of Michigan, as a further security for the debt so due to that state by the said ^company, without the authority of the directors of such company, another mortgage given by the Long Island Railroad Company, as an additional security for the said debt of the latter company, and that such assignment fraudulently represented that it was made in pursuance of a resolution of the board of directors of the Morris Canal and Banking Company. Here is no distinct and direct allegation that the treasurer of the state of Michigan knew, at the time he received the first assignment, that it was executed without the authority of the directors of the Morris Canal and Banking Company, and there is no allegation whatever, that the agents or state officers of Michigan had any notice or knowledge that the second assignment was executed without the authority of the directors of that company. The execution of the two assignments, in absence of all proof to the contrary, would probably authorize a presumption that they were executed in pursuance of the authority of the directors, previously given for that purpose. ( 5 Wend. 575 ; Ang. & Ames on Corp. 3d ed. c. 7, § 6.) The president and cashier of the Morris Canal and Banking Company, in executing the assignments, were acting within the scope of the legitimate business of the company, and presumptively within the general scope of their authority as agents. ( 15 Johns. 44 , 54; 1 Cow. 513 ; 9 Paige 496 ; Story on Agency, §§ '443 and 127; Ang. & Ames on Corp. c. 7, § 6.) When an agent is acting within the scope of his usual employment, or is held out to the public as having authority to
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do certain acts, the principal will be bound by the acts of the agent, although the agent, in the particular instance,- has acted without authority. (Story on Agency, §§ 443-127.) '

But the plaintiff in his bill alleges with reasonable distinctness, that the first assignment, and expressly, that the second assignment, was executed without the authority of the directors of the Morris Canal and Banking Company. If the assignments had been made to the state of Michigan, for a new consideration paid at the time, or if the state had relinquished any security then ^ ^ so as ent^e ^ to the character *of a bond fide purchaser for a valuable consideration ; and if the agents or officers of the state, who obtained the assignments, had no notice of the want of authority of the officers of the Morris Canal and Banking Company to execute such assignments, I think, that that company would be estopped from denying that its president and cashier had competent authority to execute and deliver the assignments to the state of Michigan. ( 6 Hill 96 .) Persons dealing with the company had a right to presume that these officers were authorized to sell a security of the company, either in payment of a debt of the company, or to raise money for corporate purposes, such act being within the scope of the legitimate business of the company, and also within the scope of the usual employment of such officers, as agents. But inasmuch as the state of Michigan received the assignments, as collateral security merely, for an antecedent debt, the Morris Canal and Banking Company, or its representatives, are not estopped from denying the authority of its president and cashier to execute and deliver the assignments.

As the defendant, Thompson, had notice of the defect of the title of the state of Michigan, at the time he purchased, he is entitled to no other rights than those possessed by the state. Upon the ground, therefore, that

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according to the allegations of the bill, the two assignments to the state of Michigan were executed by the president and cashier of the Morris Canal and Banking Company, without the authority of the directors of that company, I am of opinion, that the judgment of the superior court should be reversed, and that the demurrer to the bill be overruled, with liberty to the defendants to answer the bill.

My brethren concur with me in the opinion, that the judgment should be reversed, upon this ground. They also concur with me in the opinion, that the purchase by the plaintiff of the debt due by the Long Island Railroad Company did not involve the offence of either maintenance or champerty. As to the other questions discussed *by me in the foregoing opinion, I do not understand any of my brethren, except the chief judge, as expressing any opinion.

Decree reversed, and that of the su reme court at special term affirmed.

Cases cited