Earle v. Carson

When the Chestnut Street National Bank of Philadelphia suspended payment and its doors were closed, there stood on the stock register ten shares in the name of the defendant in error. A call having been made by the Comptroller for the sum of the double liability, this suit was commenced to recover the amount. The defense was: First, that prior to the suspension of the bank the defendant had, in good faith, sold the stock standing in her name for a full market price, which had been paid her; second, that, in consummation of such sale, she had, by her agent, delivered to the proper officer of the bank in its banking house, at the place where transfers were made, the stock certificate, with an adequate power of attorney to make the transfer, and requested that the stock be transferred; third, that the officer of the bank said that the transfer would be made as requested, and the defendant was ignorant of the fact that the officer had failed to discharge his duty; fourth, that, as the defendant had done everything which the law required her to do to secure the transfer, she had ceased to be a stockholder, and was not responsible.

In submitting the case to the jury the court instructed: First, that the presence of the name of the defendant on the stock register created a presumption of liability. This, however, the jury was informed, was not conclusive, but might be rebutted. Such rebuttal, the court charged, would result if it was proved that the defendant had made a bona fide sale of her stock, and had, at the proper time and place, handed to the proper officer of the bank a power to transfer the same, although the officer of the bank had neglected to fulfil his duty in the premises. Second, after charging fully and accurately as to the proof essential to show a bona fide sale of stock in a national bank, the court having, during the trial, applied a like rule in passing on the admissibility of evidence, instructed the jury if the evidence established that a sale of such character had been made while the bank was a going concern, the defendant would not be liable, because, unknown to her, the bank was, at the time of the sale, in fact insolvent. And the same principle was applied to the unknown insolvency of the person to whom the stock was sold. There was verdict and judgment for the defendant, which was affirmed by the circuit court of appeals; thereupon this writ of error was prosecuted.

Messrs. Charles Biddle and Asa W. Waters for plaintiff in error.

Mr. Richard C. Dale for defendant in error.

Mr. Justice White, after making the foregoing statement, delivered the opinion of the court: