Quay v. Presidio & Ferries Railroad

Fox, J. John G. Kellogg, respondent’s testator, was the owner of two hundred shares of the stock of the corporation defendant, evidenced by certificate No. 27, issued in the name of said Kellogg, May 3, 1882.

On June 17, 1884, Kellogg was absent from this state, and A. W. Bowman and Joseph M. Quay each held powers of attorney from him, in full force, and each was acting as his attorney in fact in the conduct of his business. When he went away Kellogg left this certificate in possession of Quay, and on or about the said 17th of June Bowman went to Quay and asked Quay to let him have the certificate, as “he wanted to sell one hundred shares, and he did not want to have it appear on the books that he was selling his own stock.” Quay delivered the certificate to him, as requested, and thereupon Bowman indorsed the certificate, “ Jno. G. Kellogg, by A. W. Bowman, his attorney in fact,” and sent it to the office of the company, where, in pursuance with his request, two new certificates were issued in lieu thereof, each for one hundred shares, one in the name of said Kellogg and the other in the name of George F. Bowman, trustee. The new certificate issued in the name of Kellogg was delivered to A. W. Bowman, and by him delivered to Kellogg after the latter’s return. The certificate issued in the [3]name of George F. Bowman, trustee, was delivered to him, and by him sold to one Bradley, for the benefit of A. W. Bowman, the certificate therefor being numbered 363. After Kellogg’s return he had a conversation with Quay, iii which the latter informed him of the transaction between himself and Bowman, when Kellogg said: “ Personally, Quay, I don’t hold you responsible. Had Bowman asked me to loan him the stock, my relations were such with him that I would have let him have it.”

This action was brought by Kellogg against the corporation defendant, for the sum of six thousand five hundred dollars damages for the unlawful conversion of the hundred shares of stock, part of the said two hundred shares, so represented by said certificate No. 363. Kellogg died pending the suit, and Quay, his executor, was substituted as plaintiff. Plaintiff had judgment, motion for new trial made and denied, and defendant appeals from both the judgment and order.

On the appeal two points are made: 1. That the court erred in denying defendant’s motion for nonsuit. The case upon this point depends upon the construction to be given to Bowman’s power of attorney.

The by-laws of the company, as is usual in such cases, provided that stock could be transferred on the books of the company by the delivery of the old certificate properly indorsed, and the issue of new certificate or certificates therefor, the old certificate to be gt the same time canceled. The certificate in this case was delivered as before stated, indorsed, “ Jno. G. Kellogg, by A. W. Bowman, his attorney in fact.” Before canceling that certificate, and issuing new ones in its place, it was the duty of the corporation to know whether it was properly indorsed; in other words, to know whether Bowman held a power of attorney authorizing him to make such indorsement, and if he did, whether there was any limitation as to the purpose for which he was authorized t© make it.