Pearson v. Tower , 55 N.H. 215 ( 1875 )

As the demurrer admits the facts charged in the amended bill, I think the plaintiff is entitled to the relief he seeks. The duties of the treasurer should not be merely nominal. He is required to give bond for the faithful performance of the duties of his office, and is the proper custodian of the funds of the corporation. This bond is for the security of the stockholders, and they are entitled to the benefit of it. There is no objection to his depositing the funds in as many different places as convenience may require for transacting the business of the corporation. Of course it is not possible that all the receipts be paid to him in the first instance. The collections of the corporation are made from the sale of tickets and transportation of freight, not only at different stations on its own road, but at stations and offices on connecting roads. These subordinate officers make weekly or monthly settlements with the general officer of the road, said to be the cashier; and it seems to be eminently proper that he should, at frequent periods, perhaps as often as once a month, pay over to the treasurer the moneys that come into his hands. If the treasurer finds it necessary to make deposits with banks or bankers in Concord, Manchester, Nashua, or Boston, for convenience in paying claims against the corporation, there is no objection to his doing so, with such banks or bankers as he may be willing to deposit the funds with; but the deposits should be under his control as treasurer, that the stockholders may have the security of his bond in case of failure. It is no answer to say that the banks and bankers, with whom the money of this corporation was deposited when this bill was filed, were perfectly solvent. It is notorious that banks and bankers, having the entire confidence of the community, become insolvent, and that, too, often unexpectedly.

The seventh by-law of this corporation provides, among other things, that the treasurer shall give a bond in the sum of $30,000, to be kept in the custody of the president; and it is made his (the treasurer's) duty safely to keep * * all the moneys, securities, and valuable papers of the corporation, and "to disburse and deliver over the same as the directors shall require."

There is nothing in the language of this by-law that authorizes the directors to make such a disposition of the funds of the corporation as would practically make the duties of the treasurer merely nominal, relieve him from liability for the safe keeping of the funds, and place them in the hands of banks and bankers with only their personal security for the same. The natural and reasonable construction of the language of the statutes, charter, and by-laws of the corporation requires that the treasurer, in disbursing the funds of the corporation according to the requirement of the directors, should pay them out to satisfy such claims against the corporation as the directors shall authorize; that until the funds be needed for that purpose the treasurer is the only proper officer of the corporation to whom the custody of the funds should be entrusted. Under pretence of disbursing the moneys, it would be a clear violation of the provisions of the law to require him to deposit them in the hands of others for safe keeping, and that too with no security except their personal responsibility for the same.

The complainant shows cause for invoking the aid of the court to protect his interests against unsafe investments of the funds of the corporation, and is entitled to the relief he seeks.

The decree should of course be drawn in such way as not to interfere with the transaction of the business of the corporation with such facilities as may be reasonably necessary. What is required is, that the funds of the corporation, collected from its subordinate officers and agents, should be deposited with the treasurer, who is the proper officer, for safe keeping and disbursement, that the stockholders may have the security which they have the right to claim under the laws.

LADD, J., concurred.

Demurrer overruled.