Union Bank of Florida vs. S. Parkhill's Administrators de bonis non; S. Parkhill's Administrators de bonis non vs. Union Bank of Florida, 2 Fla. 660

Lawcastek, Justice, delivered the opinion of the Court: This case comes by cross writs of error from Leon Circuit Court. We shall, for the sake of convenience, embody our opinion and rulings in one decision. The first question, to which we will turn our attention, is one raised in argument by the counsel of the administrators, earnestly argued and much insisted on. By 15th

section of the act of incorporation, the bank is created, and declared a body corporate and politic for and during the term of 40 years from the passage of the act, viz : from 13th February, 1833. By

an act of Congress of 3d March, 1845, Florida was declared to be a State of the United States, and admitted into the Union on an equal footing with the original States in all respects whatsoever. The question raised is, whether the corporation did not perish on the 3d of March 1845, notwithstanding its grant of 40 years existence ; and it is contended the charter must be subject to the implied limitation “ provided the Territory shall so long continue.” This question is assumed in argument to arise under plaintiff’s demurrer to tire seventh and last plea of defendants.

That plea in sub. stance alleges, that the writing obligatory declared on is not the act and deed of defendant’s intestate in his life time, but is and was wholly illegal, null and void, because made in consideration of a loan of money upon a pledge of stock, (he being a stockholder), and that the bank, the plaintiff, wilfully and knowingly reserved and took more than the lawful rate of interest allowed to said bank to take upon such loans by law and its charter. Upon argument in the Circuit Court, the demurrer was sustained, and no exception was táken to the ruling of the Court.

The tenor of the plea does not appear to this Court to put in issue the existence of the bank, but virtually admits its existence. This suit was commenced on the 31st of March 1846, and as the position taken is, that the admission of Florida as a State, into the Union, on the 3d of March 1845, by implied limitation, extinguished the char, ter on that day, no good reason is apparent, why a plea presenting that issue, if deemed necessary to the defence, was not prepared and filed during the preparation for trial of the case.

This cause appears to have been elaborately investigated in the Court below, and lengthy bills of exceptions have been filed to the decisions of that Court by each of the parties, and this point is not raised by either bill of exceptions. It does not come by the pleadings before this Court, and any opinion delivered on it, might justly be termed extra-judicial, or coram nonjudice. To allow points not raised by the record to be adjudicated by this Court, might, and probably would, result most inconveniently.

Who could set limits to their number 1 The case of Mumma vs. the Potomac Company referred to 8 Peters R. 281, does not appear to sustain the authority of this Court to take jurisdiction of this point. That was a case in which the plaintiff, Mumma, sued out a sciri facias to revive a judgment against the Potomac Company.

Upon that sciri facias the attorneys, by way of plea, shew and suggest to the Court a state of facts, and among other recitals, that the Potomac Company had surrendered its charter to the Chesapeake and Ohio Canal Company, and an agreement to that effect was signed by the counsel for both parties, and made a part of the record. The question upon this agreement was, whether any judgment can be rendered against the Potomac Company upon the sciri f acias to revive a judgment mentioned in the writ.

Upon this question the Circuit Court of the District of Columbia gave judgment for the defendants, which was taken by writ of error to the Supreme Court of the United States, and the judgment of the Circuit Court was affirmed. The jurisdiction of the Court was derived from the writ of sciri facias to revive, &c., and not from the agreement of counsel as to the facts; and the decision of the Supreme ■ Court was upon the judgment properly brought before it, from the Circuit Court, and upon the point on which that judgment was rendered.

In the-case before this Court, although the counsel for the bank did not decline the argument of the point now under consideration, yet there is no agreement of counsel on the record submittingjt for adjudication; and if there was, the case before referred to, would not be an authority to justify this Court, in proceeding to its adjudication. Without therefore, any disposition to avoid it, if properly before us, we must in this case decline its decision.

The questions on the record in this case, arising from the decisions of the Circuit Court, admitting on the trial testimony excepted to, refusing instructions asked, and giving instructions excepted to, as well as a refusal to admit testimony offered, and exceptions thereto taken, seems to this Court to render a review of many provisions of the act of incorporation, as well as amendments thereto, necessary, in order to give a construction to the charter, applicable to the many questions presented on the trial below.

We proceed to that review, first remarking that but little light is afforded us by the decisions either in England or the United States, upon the subjects involved. But few charters of incorporation, bearing much analogy to that of the Union Bank of Florida, have been passed by the States of the Union, and it is not known that any similar ones have been passed elsewhere. Neither is it known or believed, that any of those incorporated in any of the States, have undergone judicial investigation or construction, so as in any degree to aid this Court in arriving at sound and just conclusions.

There are, however, rules laid down in the books, by which to be guided in the construction of statutes, and to these we shall have recourse as occasion may seem to require. The 1st

section of the act of incorporation provides for the establishment of the “ Union Bank of Florida with a capital of one million of dollars, and with the privilege of increasing it to three millions of dollars, which capital shall be raised by means of a loan, on the faith of the Territory, by the Directors of the Bank.” Of which only one million to be taken at the time of organizing the bank. By the 2d section, books of subscription, towards constituting the capital fund of said bank, were authorized to be opened at Tallahassee and other places therein named, for subscription to the stock.

By the 7th section, “ The Board of Directors of the hank shall be the judges of the sufficiency of the mortgages offered for the stock, and shall have power to reject the same.” The 8th

section enacts, “ To secure the principal and interest of the bonds to be issued by the Territory, for the purpose of raising the capital of the bank, the subscribers shall be bound to give a bond and mortgage to the satisfaction of the Board of Directors, on property, &c.” The 9th

section provides, “ The bonds and mortgages given to secure the subscriptions to the capital stock of said bank, shall be deposited in the office of said institution, the said mortgages having' been first recorded according to law ; and whenever application shall be made by a stockholder to transfer his stock and be discharged, such transfer' and discharge may take place, upon the new stockholder complying with the same requisitions, stipulated in the foregoing (the 8th) section, in the case of an original subscriber, and' in all such cases of transfer and discharge, the votes shall be taken by yeas and nays.

But any stockholder may, at any time, release his property by paying the amount subscribed, and also such loans as may have been made on the faith of it. The 10th

section provides for issuing one thousand bonds of one thousand dollars each, made payable to the Union Bank of Florida, to be “ signed by the Governor, and countersigned by the Treasurer, and under the seal of the Territory,” for which bonds a form is given in said

section ; which bonds are made transferable by the endorsement of the president and of the cashier of said, bank by said

section — for the payment of which, the faith of the Territory is pledged, “in order to facilitate the negotiation by said bank for the-loan of one million of dollars.” The 11th

section provides, that “Both the capital and interest of the said bonds shall be paid by said bank,as the same shall become due.” The 14th

section prescribes the form of the mortgage to be given to the Union Bank by the stockholders, and begins by saying, “ The mortgage to be given by the subscribers to the stock of the Union Bank, shall be in the following form :” We will inquire, what constitutes a stockholder in the Union Bank, and what are the rights of the bank in the stock subscribed to it? It may safely be assumed the act of subscribing for shares, as provided in sec. 2 of the charter, does not per se make a stockholder, any more than the mere subscribing for cash stock will make a stockholder in an ordinary banking incorporation.

In the latter case, the shares subscribed must be paid for in money; in the former, according to the sections before recited, they were paid for by the bond and mortgage of the stockholder. The giving a mortgage for the stock satisfactory to the Board of Directors, was the final act necessary to constitute a subscriber for shares a stockholder. See sec. 7 ; and that mortgages made and delivered to the Union Bank was the only consideration or payment of any nature given by the stockholder to the bank, for his shares or certificate of stock in it.

The bank, then, being, under the charter, the lawful possessor and owner of the mortgages, makes them available by the 8th and 10th sections, for the procurement of territorial bonds. These bonds were, by the 10th

section of the charter, made payable to the bank, and transferrable by the endorsement of the president and cashier of the bank; and by the 11th section, after sold, both capital and interest payable or redeemable by the bank, as it becomes due. It appears, therefore, too plain to be questionable, the bonds, when procured, were the property of the bank, and when sold, the funds arising from the sale were the funds of the bank.

It is contended, in view of the 8th section, the object for which a bond and mortgage was given by the subscriber for stock, was to secure payment of the principal and interest of the bonds issued by the Territory, to the extent of his stock subscription. It is admitted they were given for that purpose, yet it seems to this Court that was not the only purpose of the mortgage. The last clause of

section 9th provides, “ but any stockholder may, at. any time, release his property ( mortgaged) by paying the amount subscribed, (as stock,} and also (by paying) such loans as may have been made on the faith of it,” (the mortgaged property.) It (the last word of the sentence) must, on sound rules of grammatical construction, refer to its last antecedent noun, which is property ; so that, supposing the stock to have been paid for in money, the stockholder, to have his property released from the mortgage lien of the bank, must also pay such loans as may have been made on the faith of the property specified in the mortgage.

Shares in this bank were not, as in banks usually, purchased by cash payments ; and while a stockholder in a cash stock bank would, on a pledge of shares, pledge the very money he had paid for them, in this bank, unless he pledged the mortgage securities given for stock, he would pledge nothing valuable ; so that, if contended loans were to be made on the faith of the subscription for stock, without reference to the mortgage security, then the gross absurdity will follow, that the bank was bound to loan to its stockholders, without any security whatever.

Suppose for a moment, the instant of time when, according to its charter, the Union Bank was first in a condition to discount — it was the holder and owner of mortgages on real estate and negroes, ese-cuted and delivered to it by its stockholders, to the value of one million of dollars.

It was also the holder and owner of one million of dollars in money, produced by the sale of the bonds, and for the payment and redemption of the principal and interest of these bonds, as they might fall due, it was bound ; and if the time we are considering occurred before any interest had accrued on the bonds after sale, yet the bank owed just as much money as it possessed, and the stock* holders had no valuable interest in bank save their mortgages.

The stock, for which nothing had been paid, if we exclude the idea of the mortgages, had not really appreciated, and was really worth nothing, save only such ideal appreciation as the right to a loan under the 29th

section of the charter might induce those needing money to be willing to pay for that right of loan.

If, at that time, a stockholder had á right to credit in bank, without other security than a pledge of his shares in the capital stock of the bank, and also a loan on a pledge of those shares for two-thirds their amount, still, excluding the idea that the mortgage had been given as payment for the'shares, we must arrive at the conclusion that he, the stockholder, had a right to demand and have from the bank a stock loan, without any valuable security Whatever; and thus, that the bank was compelled by its charter to loan to its stockholders two-thirds of its entire money capital, with a positive certainty that neither principal nor interest on that loan would ever be paid before the expiration of its charter, and almost with an equal certainty, not at that time or any other.

Such we feel authorized from the wording of the charter, to declare was not the intention of the Legislature, and cannot be a sound construction of its provisions. We have shown, we think, that the mortgage given by the stockholder to the bank, was executed for the double purpose — 1. As provided by the 8th section, to secure payment by the bank of the principal and interest of the bonds issued by the Territory ; and for this purpose, the Territory, the third party, in the charter of the bank is interested in the mortgages ; 2d.

To secure payment from the stockholder to the bank of his stock note, or obligation, and interest, provided he fails to renew the note or obligation, and pay interest, as provided in the 29th

section — and for this purpose, the bank and all its creditors are interested in the mortgages, as well as for the first purpose.

It has been alleged in argument, and indeed the Court below virtually so-instructed the jury, that the money raised by the sale of the bonds was, in the hands of the bank, the money of the stockholders— that the bonds sold by the bank were, inform only, the bonds of the Territorial government, and in effect and actually were the bonds of the stockholders, and are in effect and contemplation of law, as if both bond and mortgage had been originally made and executed to the capitalist or holder of the territorial bonds by the stockholder— that, upon the sale of the bonds, the stockholder became debtor to the vendee of /the bonds, and he, in turn, the creditor of the stockholder — that the bank was a mere agent or trustee of the stockholder, to see the principal and interest paid, agreeably to the terms of the bond and mortgage, without other rights in the premises, save the privilege of endorsing for its principal, the stockholder.

The 1st

section of the charter incorporates a bank by the name of the “ Union Bank of Florida,” and says it shall have a capital of one million of dollars, with the privilege of increasing to three millions. The 15th

section provides that “ The subscribers to the stock of said Union Bank, their successors and assigns, shall be and they are by this present act created a corporation and body politic, for and during the term of forty years from the passage of this act, and shall be and are hereby made capable, under the name of the ‘ Union Bank of Florida,’ to receive and possess all kinds of property, either movable or immovable, and to sell, grant, alienate, demise and to dispose of the same — to loan, negotiate, take mortgages and pledges, and to discount on such terms and such securities as they shall judge proper and after some provisos not necessary here to be considered, the section' adds: “ They may sue and be sued, plead and be pleaded, answer and receive answers in all courts having competent jurisdiction, and to have a'common seal, and the same to alter arid renew at pleasure, and to ordain and establish such by-laws, rules and ordinances as they shall deem necessary and suitable for the government of the said corporation, not being contrary to this act, nor to the constitution and laws of the United States, or to the laws of the Territory of Florida.” The Union Bank of Florida, by these provisions of its charter, may justly be styled a corporation, and is a creature of the charter that constitutes and gives it being, and prescribes bounds and limits to its operations beyond which it cannot regularly proceed.

See Bac. Abr. title corporation, letter D., and many authorities there cited. Its name is the very knot of the combination of its members, without which they could not perform their corporate acts, for it is nobody to plead and be impleaded, to take and give, until it hath gotten a name. Bac. Abr. Corporations, Letter C. Although a corporation aggregate is said to be invisible, and to exist only in supposition and intendment of law, yet such an artificial body is, by its creation, capable of purchasing or parting with its possessions. Bac. Abr. on Corporations, Letter E.

The name of a corporation is as the name of baptism. 10 Co. 28. 2d Inst. 666. We repeat, therefore, what we have before shewn, the mortgages belonged to the bank, for it had a right to take mortgages. The Territorial bonds, issued and made payable to the bank, were also the property of the bank, for they were issued on the faith and value of the mortgages held by and belonging to the bank ; and the proceeds of the sales of those bonds belonged to the bank, for it, and it alone, by its officers, had the right to sell and transfer them.

It is said, on the sale of the Territorial bonds, the stockholder became debtor to the vendee of the bonds, and he in turn became creditor to the stockholder. Without remarking on the novelty and surprise with which this doctrine would strike the bondholder — let us see if it be so. Is every bond so marked that each bondholder can know what stockholder he must look to for its payment ?

Or must he look to all the stockholders, and has he any means of knowing them, or any of them, but through the courtesy of the bank 1 If a stockholder is the debtor of a bondholder, is it of all bondholders, or a particular one i And if a particular one, is it for all the bonds he may hold, or only for so many bonds, and parts of bonds as his stock may amount to 1 Should he transfer his stock, as by the charter he may, does he make his transferee the real debtor, and release himself without the knowledge or consent of his creditor, the bondholder?

Answers to these inquiries will, in the opinion of this Court, ■ fully shew the fallacy of the position assigned the stockholder, and which they are intended to controvert. The first clause of the 3d

section of the act of incorporation is also invoked to shew the charter will not admit of the construction in this opinion indicated.

That clause is in these words. “ In all instances in which slaves shall be mortgaged, in virtue of this act, the possession thereof shall be and remain in the mortgagor, any law to the contrary notwithstanding, until by the covenant or covenants contained in said mortgage, it shall be lawful for the said bank to seize the same.” Let us premise, if it was intended at all events to permit the stockholder to remain in possession of the slaves mortgaged, any law to the contrary notwithstanding, until the expiration of the charter of the bank, why did the Legislature not say so, instead of using the inore doubtful and circumlocutory language adopted ?

If we adopt the construction that the language used (and such it is contended is its meaning) was intended to protect the mortgagor in possession of the slaves until the Territorial bonds shall become due, and the bank shall make default in their payment, we must destroy the plain intent of the 9th and 22d sections of the charter.

If we understand the covenant or covenants contained in the mortgage to apply as well to the payment of the stock note, or obligation of the stockholder, as to securing payment of the Territorial bonds when due, and that on default of complying with the proviso in the ,29th section, to give a note or obligation annually for repayment of the money, (loaned) and paying up the interest, the bank may seize the mortgaged negroes, then we save the 9th, 22d, 26th, and other sections of this charter, and make all stand together, and all bear in the rights and duties both of the bank and its stockholders, and all tend to advance the interest of the creditors of the bank; while the contrary construction would tend to make of the stockholders an irresponsible class with exclusive privileges, (and the greater the stockholder, the greater the privilege,) as well also as inflict on the bondholders and other creditors of the bank, the greatest injury and the most stupendous fraud.

Can there be a doubt we should adopt a construction which makes the mortgage property responsible for the stock note due the bank. In the case of the Commonwealth vs. Kimball, 24 Pick. 370, Ch.

Justice Shaw says : “ It is unquestionably a well settled rule of construction, applicable as well to penal statutes as to others, that when the words are not preciso and clear, such construction will be adopted as shall appear most reasonable, and best suited to accomplish the objects of the statute; and where any particular construction would lead to absurd consequences, it will be presumed that some exception or qualification was intended by the Legislature to avoid such conclusion.” In the case of Wales v. Stetson, 2 Mass. 146, Ch.

Justice Parsons says : “ In the consideration of the provisions of any statute they ought to receive such a reasonable construction, if the words and subject matter will admit of it, as that the existing rights of the public, or of individuals, be not infringed.”. In Bac.

Abr. title statute, letter H. it is laid down, “ The most natural and genuine way of construing a statute, is to construe one part by another part of the same statute, and this best expresseth the meaning of the makers, and such construction is ex viceribus aclus.” And again, same title. “ If the literal expressions of the law would lead to absurd, unjust, or inconvenient consequences, such a construction should be given as to avoid such consequences, if from the whole purview of the law, and giving effect to the words used, it may be fairly done.” Impressed with the soundness and wisdom of the afore recited rules, and aiming to adjudicate by their spirit and true meaning, construing one part by another part of the whole charter of the bank, and in view of the verbal obscurity in some of the provisions, which'render it difficult to arrive at the true meaning of the Legislature, but bound to presume it was never the intention of the Legislature, that absurd, or unjust, or even inconvenient consequences should flow from the enactments contained in the charter, we think in every instance where a stockholder fails to renew his note, and pay up the interest, if the bank shall file for cancellation, with any officer of the Government, whose duty it may be to receive them for that purpose, and in default of such an one, with the Clerk of the Court in which suit may be depending, to be delivered to such officer for the same purpose, as many Territorial bonds as were issued on the faith and'value of the mortgage securities of such defaulting stockholder — that then the bank, upon judgment rendered and execution issued, may of right and according to the law of its charter, levy upon and sell all the mortgaged premises of such defaulting stockholder to be applied to the extinguishment of the judgment rendered on his stock note debt, together with interest due and costs accrued, the residue, if any, to be first applied to liquidate-his liabilities in bank,'as endorser or security, and the remainder, if any, to be paid to him.

Two exceptions taken by the plaintiff below to the decisions of the Circuit Court, admitting testimony upon the plea of plene administra-vit, remain to be considered. 1st. Certain receipts of H. Manly, the present husband of the relict of S. Parkhill, deceased, the intestate of defendants, which receipts purport to have .been given for sums in part of the.dower of Mrs. Manly, rejected by the Court of Probate. 2d.

The admission of testimony upon an alleged liability of the administrators for counsel fees, and for which they claim the right of retainer of such sum as the witness supposes would be a reasonable aggregate compensation for services of counsel in this case, and some twenty cases of detinue brought by Parkhill’s administrators, and also a suit for foreclosure brought by the bank against Mrs. Manly and her husband, which was carried to the Supreme Court. The act of the Legislature of February 15, 1834, concerning the duties of Executors, Administrators and Guardians, (see Tho.

Dig. p. 207), provides for the settlement annually of the accounts of Executors and Administrators by the Judge of Probates, and that they shall render full and correct accounts of the receipts and disbursements of the estates in their charge, and says, “ if approved, or so much thereof as may be approved, it shall be entered on the record and the accounts filed. If it be not approved, the only proper course by which the Executor or Administrator can attain redress, if injured, is by appeal or writ of error.

But if rejected, as the order of the Court of Probates is conclusive until reversed, it is not seen how the administrators can be permitted to avail themselves of it as evidence on the plea of plene administravit. And this objection lies as well to the evidence to establish the value of the counsel fees, which, as well as the first, should have been audited and allowed, or if rejected, by appeal reversed, before a right to use them as evidence on the plea of plene administravit could attach. On the subject of counsel fees we will remark, it is laid down in the case of Sterrett’s appeal, 2 Penn.

Peps. 426, “ Where an estate is so situated that legal advice is proper to direct the course of the Executors, or where they must bring suits to recover part of the estate, or defend suits brought against them, counsel must be employed, and where they are employed to obtain what is honestly supposed to be the rights of the estate, the estate ought to pay the counsel fees. But where Executors neglect to settle and pay, and are sued by creditors or cited by heirs, and employ counsel to defend them in their iniquity, no counsel fees should come from the estate.” And this doctrine, in our opinion, is correct.

On the trial of this cause, the Circuit Court gave ten instructions, numbered from one to six inclusive, and from eleven to fourteen inclusive — to all which, defendants by their counsel excepted, save the second, and also moved the Court to give fifteen several instructions, which the Court refused, except the third, which was granted, and the fourth, which was refused, and substituted by another — all which is contained in their bill of exceptions, and by reference to the record will fully and at large appear.

To all which refusals, the defendants by counsel excepted, and prayed their bill of exceptions may be signed, sealed and made part of the record, which was' done ; and thereupon they obtained and sued out their cross writ of error to this Court. By reference to the instructions given and refused, and excepted to by the defendants below, it will be perceived the principal points they make are aimed at the rate of interest which the bank might lawfully demand and take from a stockholder who was its borrower, and the time at which that interest was payable to the bank.

To have a clear understanding of these questions, it is necessary to examine the 28th and 29th sections of the charter, which are as follows : “ Sec. 28. Upon loans or discounts, the said bank shall not receive more than at the rate of eight per centum per annum — the interest may be paid or deducted in advance.” “ Sec. 29.

Each and every stockholder shall be entitled to a credit or loan equal to two-thirds of the total amount of his shares : Provided, That notes or obligations for repayment of the money shall be annually received, and the interest paid up : And provided, also, that when the accumulated surplus profits shall have equalled the amount of the bonds issued by the Territory for obtaining the capital of the bank, the interest upon all loans shall be reduced to a rate not exceeding six per centum per annum.” We think it manifest, from the last proviso of the 29th section, the rate of interest 'which the bank was authorized by law to charge, was more than six per centum per annum; otherwise, why did the legislature provide, upon the contingency therein named, that the rate of interest should be reduced, so as not to exceed that sum.

The true construction of the word credit in the 29th section, has been the source of much discussion, and it has been contended it is of such extensive import or signification as to entitle a stockholder, at all times and under all circumstances, to a loan from the bank, equal to two-thirds of the amount of his shares.

The term is used in the connection, “ credit or loan,” and was probably intended by the legislature for nothing more than an equivalent for the word “ loan,” or it may have been intended to invest the stockholder, on the faith and virtue of the mortgage securities he had given the bank, with a right to a loan, free of the endorsers which an ordinary borrower might be required to give. But whichsoever may be the true intent and meaning with which it was used, it was subject to the proviso, that notes or obligations for repayment of the money (borrowed) shall bo annually received and the interest paid up.

It was contended that this proviso did not create a condition precedent or subsequent to defeat the loan ; and if a condition, could only be a condition subsequent to defeat the continuance of the loan.

Will or can any one successfully contend that a stockholder, as such, was or could be entitled to any loans whatever, unless he first gave a noto or obligation for repayment of the money borrowed, and if that was necessary, (as we think it was,) whether it was not a condition precedent to obtaining a loan 1 At the time of giving a note or obligation for repayment of the money, by the conjunction and he was also required to pay up the interest. So it seems the giving the note and paying the interest at the time of borrowing the money, are both conditions precedent, properly deducible from the 29th

section of the charter. It is objected the frame of words, “ and the interest paid up,” are repugnant to this construction, and they must mean interest in ar-rear, but with equal propriety they may mean interest in advance; and this construction of the 29th

section harmonizes with the only rational one of which the 28th is susceptible. It provides that the interest may be paid up or deducted in advance upon loans or discounts by the bank. The terms, “ may be paid or deducted in advance,” are terms directory and enabling to the bank, as are all the provisions of that

section ; and if we understand that the bank, upon a loan or discount, may deduct the interest in advance, or upon a renewal, may require it to be paid in advance, we but understand these words according to their natural force and usual import. The proviso, therefore, in our opinion, contains two conditions precedent to a stockholder’s obtaining or continuing a loan under the 29th

section ; for a failure to perform either, (to wit: renew the note, or pay the interest,) would determine the duration of the loan, divest the right to have it, and invest the bank with a right of action against such defaulting stockholder. The authority of the bank, under the 28th section, to deduct interest in advance, is an authority co-extensive with the loans or discounts it may make ; and this is a loan, peculiar in nothing save the right of the stockholder to have it, so long as he complies with the precedent conditions prescribed for his observance. The bank has, according to the 28th section, as much right to deduct interest in advance on such a loan as on any other. That

section further provides, the bank shall not receive more than at the rate of eight per centum per annum, but it may be deducted or paid in advance. The rate, therefore, of interest, which, by its charter, the bank may deduct upon a loan or discount, is eight dollars from one hundred for the use of the residue for one year, and at the same rate for any shorter time — the obligation of a borrowing stockholder being to renew his note and pay the interest once a year ; but according to bank usage, his privilege to renew and pay interest oftener, as might suit his convenience.

And if there be error in this, as it benefits the stockholder, he cannot complain. The construction of the 28th and 29th sections, above given, appears to the Court to be strengthened by other provisions of the charter. The last proviso in the 29th

section contemplates, during the existence of the charter, surplus profits equal in amount to the Territorial bonds issued. The 23d

section contemplates surplus profits, provides for their management, appropriates subsequent profits, assigning a share to the Territory, as well also as the mode, on the expiration of the charter, of a division of capital. The 36th

section directs the disposition which shall be made of the profits which shall accrue to the Territory, and in other sections of the charter, mention is made of the surplus profits.

Now, when it is recollected that two, out of its three millions of capital, must, if required, be loaned to its stockholders — that near that amount was in fact loaned them — that the bank itself has a continually accruing interest debt, payable to its creditors, which amounts annually to $180,000, besides contingent expenses as they may occur — unless a rigid exaction of interest is demanded of the stockholders, it would seem to require unusual arithmetical powers to enable a financier to discover how those surplus profits could arise.

The bank is known to be in an embarrassed condition, from which it will hardly recover, and has no surplus profits to manage. The value of its stock has depreciated, and is far below par.

Yet it is perhaps not too much to say, had the debtors (stockholders and others) bona Jicle and fully paid interest on their respective liabilities, as the same were due the bank, unless, indeed, it was otherwise very badly managed, or had met with great and unavoidable misfortunes, it would now have in possession large surplus profits — its stock would be much above par, and its creditors would hold its liabilities at their original cash value.

We think, then, the bank had and has a right to interest on stock loans, at the rate of eight per centum per annum, and also to deduct it, or require its payment in advance. The giving a note and payment of interest are conditions precedent, and without the performance of both, the stockholder has no right to a loan ; or at any renewal or failure to perform both, determines the stockholder’s right to his loan, and unless he pays the whole amount borrowed, the bank has a right of action against him. Some objections have been raised in this case upon the use of Rowlett’s interest tables.

We will remark, that, from the testimony, it seems abundantly clear, the officers of the bank, when computing for a year by those tables, computed for a solar year, or three hundred and sixty five days, and for a month or months as aliquot parts of a year; in all which there cannot be error. But when computing for less than a month, as for days of grace, they computed each day as the l-30th of a month, instead of the l-365th part of a year.

In computing fractions of a month, it is not easy, as every practical arithmetician must know, to adopt any rule but the one adopted in the tables, to wit: of supposing the month to consist of thirty days, which is nearer the 12th part ofthe year than any other integral number. We think the rule for practical purposes, the most accurate which , has yet been devised, and are not inclined to condemn it. The subject of the sale of the stock of Samuel Parkhill, under the amended charter passed in the year 1839, was also raised by the instructions asked by the defendants in the Court below. By the 2d

section of that amendatory act, the sale could only be perfected by the purchaser executing to the bank, within ten days thereafter, bonds and mortgages necessary to make him a stockholder to the amount of the stock purchased. If that was not done (as from the testimony in this case, it seems, was not), the sale would not be valid, and would not divest the liability or interest of the original stockholder.

The amendments contained in this law were only cumulative remedies, by way of penalty to coerce stockholders to a more exact observance of renewing their notes, and paying up the interest, and we think a failure to effect and carry .out its provisions, does not divest the bank of any other remedies given by the provisions of its charter, and the law of the land against a defaulting stockholder.

Upon the subjects of the rate of bank interest, the time when it is payable, the use of Rowlett’s tables, and the time for which a stockholder’s .note is required by the charter to be given, we are fully sustained in the positions we assume, by a very able decision delivered by Judge Bronson, at the January term, 1844, of the late Court of Appeals of the Territory of Florida, and we take pleasure in saying, that decision discusses the whole of the subjects with a perspicuity and clearness, alike honorable to the heads as the hearts of the very able Court from wbich it emanated.

Having, as we think, fully reviewed all the points raised by the ' bill of exceptions in this case, which are deemed necessary to its proper determination, and .having, we trust, given a reasonable, a just and correct construction to such provisions of the charter as seemed proper or necessary to examine, it now remains to pronounce the rulings of this Court, based upon the record presented, and the exposition of the charter, and the legal rights of the parties, as here-inbefore set forth, explained and declared.

We are of opinion that the Circuit Court erred in permitting the receipts offered as evidence by the defendant, Moseley, as part of the dower of Mrs. Manly, to go in evidence before the jury, on the plea of plene administravit, and also the evidence concerning the counsel fees — which decisions are hereby overruled and reversed.

We are of opinion the Circuit Court erred in refusing to instruct the jury, as prayed by the plaintiff below in its bill of exceptions, and also in each of the six instructions given by the Court, and to which' the plaintiff by its counsel excepted ; which said decisions of the Court, refusing to instruct as prayed, and instructions given and excepted to, are hereby overruled and. reversed.

We are further of opinion, that on the nine instructions given by the Court, and excepted to by defendants by their counsel, there is nothing to which defendants can take any legal exception, as the said instructions were fully as favorable to them as by law they had a right to require. And as to the instructions asked by defendants and refused by the Court, and to which they by counsel excepted, upon a careful examination, we do not think they were by law entitled to the allowance of any of them, and therein have perceived no error.

It is, therefore, ordered, adjudged and decreed, upon the writ of error sued out by the “Union Bank of Florida” in this case, that the judgment of the Court below be reversed, annulled and set aside— that a venire facias de novo be awarded, and a trial be thereon had, according to the principles contained in this opinion — that the cross writ of error sued out by the defendants below in this cause be dismissed, and that they take nothing thereby, and that the plaintiff in error, the Union Bank of Florida, recover its costs, &c.