Bank of Gloster v. Hindman

Mates, J., delivered the opinion of the court. The facts of this case settle it, and on the facts the chancellor could have rendered no decree other than the one that was rendered. If during the life of the Central Bank it ever had a solvent moment, it is fairly inferable from the testimony that it was before Bice was empowered by the board of directors to take charge of its assets as cashier. It is indisputably shown that all payments made to the Bank of Gloster and the transfer of collaterals and the mortgages of property belonging to the Central Bank was the enterprise of Bice on his own account, and was unknown to the directors and not acquiesced in by them in any way, or ratified either actually or constructively. There are limitations on the power of the cashier of a bank to deal with the assets of the bank, and we think that Bice went beyond any power that the courts have yet held a cashier to possess. Giving mortgages on the bank’s property, and transferring its assets, and destroying the bank itself, were not acts done by Bice within the usual scope of his authority or in the usual course of business; and this applies not only to the execution of the mortgages without the consent of the directors, [749] but also applies to tbe $500 paid to tbe Bank of Gloster at tbe time, and to such collaterals as were turned over to the State Bank & Trust Company for tbe benefit of the Bank of Gloster. Tbe decree of tbe chancellor is in all respects correct, and is affirmed on both direct and cross appeal. Affirmed.