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# The Decision in the Bank Case.
In the Court of Appeals Thursday Judge
Lacy, in delivering the opinion in the case
of the Farmers and Mechanics' Savings
Bank of this city, after reciting that the di-
rectors had been grossly negligent in the dis-
charge of their duties, and were therefore
responsible to the depositors for the money
wasted away, said:
We cannot better close the discussion
upon this question than by citing the case of
the bank against Bossieux, much relied on
be the counsel for the appellant, who says:
This question has been the subject of inves-
tigation and julieni determination by the
United States Circuit Court for the Eastern
district of Virginia. Judge Hughes, in an
elaborate opinion stating the law with great
force and clearness, exhibiting a clear and
patient examination of all the authorities,
held the defendant directors liable upon
this ground: 'Gross inattention and negli-
gence, sllowing fraud or misconduct on the
part of agente, officers, or co directors,
which could have been prevented if they
bad given ordinary care and attention to
their duties.
Jadeed this opinion is not only the most
thorough examination but the ablest exposi-
tion of the law upon the subject the writer
has been able to fiad, after examining many
authorities, and he might well be content to
rest the law of this case upon the opinion
of Judge Hughes."
We will, continued Judge Lacy, pro-
ceed to briefly review the facts of this
case to which this well established rule of
law is to be applied.
The question arises in this case as between
the directors and the depositors, not between
the directors and the stockholders. The by-
laws of this bank prescribed weekly meet-
ings.
Lis conceded that these were scarce-
ly ever held, the answers admitting that
formal meetings were not held. The decree
of the Circuit Court of Alexandria city that
it appears to the Court that there has been
no such dereliction of duty on the part of
the directors or any of them as to fix upon
theto personal responsibility cannot be sus-
tained upon ney seund principle whatever.
Upon what principle can the president be
held not to be personally liable for the acts
already detailed concerning him? The
Commissioner reports that he withdrew
without authority bonds of the bank depo
ited elsewhere and caused their sale; that
he overdrew his account and in other ways
converted the property of the bank, aggre-
gating $11,713 97. The passenger railway
was allowed to overdraw its account to the
amount of thousande-$11,314 91 at one
time. The no es of the company were dis-
counted to the amount of $6,500, and at ma-
tuzity were neither protested, renewed, collec-
ted, nor sued on. The overdraft was allowed
to increase for a year and more without se-
curity until it reached $7,530.45, which was
entirely lost to the bank the president of
the bank boing president of this company
part of the time and one of the bank direct
ors being president of the company the oth-
er part of the time in question, while
the treasurer of the railway compa-
ny was the cashier of this savings
bank. Stil-on was allowed to withdraw the
sole valuable security for his note of $2,000,
and that was lost. The president, lent his
brother $3311 62 practically without any
security, and that was lost, and actually lent
him $1,211 62 a few months before the bank
closed its doors lending to bis brother
with no security except worthless endorsers
$2300 when he had already gone to protest
on a note of $590 But the co directors seek
to escape responsibility for all this, includ-
ing the large loss to the Washington and
Ohio railroad, by claiming to have no actual
knowledge of it at all. Did they exercise
ordinary diligence to inform themselves, as
their duty certainly required that they
should? They were required to meet week-
ly by their own by-laws. They did not al-
ways meet semi-annually, meeting some-
times once a year as we have stated.
The directors, continued Judge Lacy,
were in duty bound to cause the books of
the bank to be examined at regular inter-
vale. This they never did at ali through-
out their whole career, nor did they ever
call for a statement of their accounts with
other banks. Their vaults and their cash-
drawer were emptied by illegal abstractions
sed insolvent loans, and they admit that
they never knew it, and plead this as their
exculpation. The stock subscribed for was
not paid up, as has been stated, and yet
such part as was. paid up was treated as a
lone and interest paid on it; and a large part
had never been paid up at the time of the
suspension, and some of it has not yet been
paid up. Having a bank with so small a
nominal capital, with empty vauits and
despoiled cash drawer, they owed at the sus
pension of the bank to depositors who had
Intrusted to tirem their money $53,063 63,
on which they have been able to pay only 10
per cent.
If these directors had any duty to perform what-
fter toward their depositors, the records of this
Bedo not show its performance. They plead ig-
rance One of their number was the president
of the Washington and Onio railroad in its last
90's and knew its condition and secured him-
sel int the notes of the bank were allowed to
Step unprotested, unsecared, unrecorded, uncol-
lected, and unsued on.
One of their number was the president of the
Alexandria Passenger Railroad Company and
Anew its condition.
One of their number was the brother of a debtor,
who was insolvent at the time of the loan of
thousands to him without secarity.
It is difficult to conceive that they could have
been ignorant of all this; but suppose they were,
their duty required that they should have looked
well into sit these matters, and if they neg-
Hently trusted them to others and loss has
oc
cand should it fall upon them or upon the de-
positors who hal trusted them and whose trust
they had a cepted and to whom they had solemn-
promised such care and attention as was to be
expected of good business-men?
We think the record shows that these directors,
And all of them, have been guilty of such negli
rence in the premises as makes them personally
hable for the losses caused by their negligence,
