The City Bank of New Haven v. Perkins. Bank. That the sum loaned by the plaintiffs on the application of such Cashier to borrow for that Bank, was a loan to that Bank, and that such Bank is liable for its repayment as the principal in the transaction, and the party borrowing. And that the bills in question were transferred to the plaintiffs to enable them, by a collection of such bills and out of their proceeds, to obtain payment of a debt due to them from the Bank of Akron, and not, as the answer alleges, to obtain payment of a debt due from McMillen to the plaintiffs. There is no force in the objection that the bills so borrowed of the plaintiffs were not, in fact, used by the Cashier of the Bank of Akron, for its benefit and in prosecuting its business, even if the evidence given, is, for the purposes of this action, to be treated as competent and sufficient to establish, prima facie, that fact. The bills were borrowed for the Bank of Akron, and were loaned to it, and on its credit and on the security of a portion of its assets, and were sent by the plaintiffs to that Bank, and were received at the Bank by its Cashier, and were retained in its banking house until they were paid out at its counter. In judgment of law, they came into the possession of the Bank of Akron as absolutely as if they had been delivered to the Board of Directors at a regular and full meeting of its members. What the Cashier or the Directors, or either of them, subsequently did with the bills, cannot impair the plaintiffs' claim, either at law or in equity. There could be no doubt of the validity of the transfer of the bills of exchange in question, if it had been directly authorized by the Board of Directors.. There is nothing in any part of the charter of the Bank, which has been given in evidence, that prohibits the delegation of authority to the Cashier to borrow money upon such terms as the loan in question was made, or to transfer such portion of its discounted bills as may be reasonable in amount, for collection, and to pay its just liabilities out of the proceeds thereof when collected. (The City Bank of Columbus v. Bruce & Fox, 17 N. Y. R., 514, 515.) When, as in this case, the Cashier of a Bank has actual authority to borrow money for it, and the whole management of its The City Bank of New Haven v. Perkins. business and the mode of conducting its operations are confided by the Directors to him, and so absolutely so, that his operations and mode of doing business are not examined into by them at all for years, a party who deals with and loans money to such Bank, on the faith that the acts of such Cashier, in borrowing and securing it, are authorized by his Bank, is as much entitled to protection as if such acts had been directly authorized, when such acts are of a character that it may reasonably be supposed they have been authorized by the Bank, and the business transactions between such party and such Cashier have been done openly and publicly, and in such manner that the Directors, if they had given even ordinary attention to its business, would have been informed of such transactions, and of the particulars thereof. Especially should it be so held, when the contract sought to be enforced is one which the Bank was competent to make, and upholding it violates no rule of law or principle of public policy. There is no pretense that the nature and extent of the authority of the Cashier of the Bank of Akron have ever been defined by any direct act of the corporation. On the contrary, he has been permitted, as being within the scope and limits of his authority, to exercise a large range of powers, and his own judgment as to the transactions which he deemed to be for the interest of the Bank, and the terms on which he should contract, in making engagements as its agent, which the Bank might lawfully make. Such exclusive control and management for so long a period by the Cashier, with the assent of the Directors, amounts to an authority to him to make contracts, in relation to its business which the bank might lawfully make, and will conclude the Bank as between it and a party who has dealt directly with it through such Cashier, and who, on the faith of his having authority to make such a contract, has loaned money to, or paid it for such Bank. The circumstance, that McMillen gave his own note to the plaintiffs for the sum borrowed, we regard as of no consequence under the particular facts and circumstances of this case. It cannot detract from the force of the fact that the loan was made to the Bank of Akron as the party borrowing, nor impair any obligation which it assumed by the contract made in its behalf and The City Bank of New Haven v. Perkins. in its name by its authorized agent, to repay the sum borrowed, or in relation to the securities promised, and subsequently in execution of such promise actually transferred to the plaintiffs, as the means and for the purpose of obtaining payment of the sum lent. If the views already stated are sound, the remaining questions presented by the case can be disposed of briefly. Such parts of the charter of the Bank of Akron as were given in evidence do not prohibit the Bank of Akron from paying out or putting in circulation any notes issued by any Bank which redeemed its notes in gold and silver, and which the Bank of Akron received at par in payment of debts, if of a denomination not less than $5. The contract relating to the loan contains no provision conflict. ing with this part of the charter. It was no part of the contract that the plaintiffs should furnish, or that the Bank of Akron should receive, from them, as part of the loan, any bill of a denomination less than $5. There is no evidence that the plaintiffs knew of the existence of the general statute of the State of Ohio, entitled, "An act to amend the act supplementary to the act to prevent unauthorized banking and the circulation of unauthorized bank paper, passed February 24, 1848," sections 1 and 4 of which are inserted in the case. On the 9th of October, 1854, the Cashier of the Bank of Akron returned to the plaintiffs a package of 5s, amounting to $4,600, with notice that the law of Ohio prohibiting the circulation of foreign bills under 10s took effect on the 1st of that month, and causes them to return so rapidly that we are obliged to return these, asking you to please to substitute 10s in their stead, and also for all others you may redeem hereafter." There is, therefore, no evidence that the plaintiffs knew, or had reason to suspect, when they agreed to loan the $50,000, or when they furnished the bills to that amount under their agreement to loan, or returned bills which they had redeemed, that the Bank of Akron, or its Cashier in behalf of that Bank, intended to use the bills in a manner or for a purpose prohibited by any statute of the State of Ohio. Whatever the undisclosed purpose or intent of such Cashier may have been, there is no ground for pretending that the plain The City Bank of New Haven v. Perkins. tiffs stipulated, as a part of their contract, that anything should be done with the bills loaned that would violate any statute of that State. The Merchants' Bank of New York v. Spalding, (5 Seld., 53,) and Tracy v. Talmage, Pres't, (4 Kern., 162,) are decisive of any defense based on the allegation of its being part of the agreement that acts should be done that would violate a known, or, in fact, any statute of the State of Ohio. The point of the fifth defense is, that "the plaintiffs improperly got possession" of the bills of exchange on which this suit is brought, "and are attempting to collect them of this defendant," **"and to apply the proceeds thereof to the payment of a pretended debt due from one J. W. McMillen to the plaintiffs, the consideration of which pretended indebtedness arose out of certain Bank notes of the plaintiffs, which said McMillen agreed to circulate for the plaintiffs in the State of Ohio, illegally and contrary to the statutes of the State of Ohio." What the terms of these statutes or their titles are, or when they were passed, is not alleged nor intimated. Nor are the terms of the alleged agreement, as to circulating the plaintiffs' bills, stated either in detail or generally. No agreement to actually circulate is proved. It was undoubtedly expected that they would be paid out in Ohio, and the circulation obtained that might result from such an act. But there was no agreement in respect to the fact of circulation. No statute is proved, of which the plaintiffs are shown to have had any knowledge or notice, which could have been violated by the circulation of any bills which the plaintiffs agreed to furnish, or, at the time of making the contract, were asked to furnish under it. The plaintiffs hold the bills of exchange sued upon as regular indorsees, and are attempting to collect them to obtain payment of a debt justly due to them from the Bank of Akron. They were delivered to the plaintiffs under a written authority and pledge of them, or a pledge which operated upon them from the moment of such delivery, formally executed by the Cashier of that Bank, upon the faith of, and in reliance upon which pledge, the loan has been continued and extended from one year to three years in duration. Ogden v. The New York Mutual Insurance Company. The plaintiffs, if the views we have expressed are correct, did not "improperly get possession" of these bills of exchange, but, on the contrary, obtained possession of them lawfully and for a just purpose, and are attempting to collect them to satisfy a valid debt owing to them by the Bank of Akron. They should not be defeated in their action to recover upon them, upon the evidence given at the trial in support of the issues raised by the defendant's answer. The motion for a new trial must be denied, and a judgment in favor of the plaintiffs entered on the verdict. Judgment ordered accordingly. DAVID OGDEN, Plaintiff and Respondent, v. THE NEW YORK MUTUAL INSURANCE COMPANY, Appellants. 1. Where, by the terms of a policy of insurance, all passage money received by the insured, (the owners of a vessel named,) for passengers on board said ship for a voyage specified, is insured; and subsequently such vessel sails on the specified voyage, with passengers who have paid passage money to the amount of $6,395; and the vessel and passengers are lost by the perils insured against; the insured is not entitled to recover without proof of other facts. 2. He cannot recover without proof that by the contracts with such passengers, the passage money was to be refunded wholly or in part in case of a failure to deliver them at the port of destination; or unless it appears that on the facts shown to exist, the insured is liable to refund such passage money, or some part of it. (Before HOFFMAN, PIERREPONT and MONCRIEF, J. J.) Heard, December 14, 1858; decided, April 9, 1859. APPEAL by the New York Mutual Insurance Company, the defendants, from a judgment in favor of David Ogden, the plaintiff, rendered on a trial had on the 21st of June, 1858, before Mr. Justice PIERREPONT, without a jury. The action was commenced in June, 1857, and is brought to recover (on a policy of insurance made by the defendants.) the amount paid to the plaintiff by passengers per ship Driver, for |