
    Bissell Hinsdale versus Simon Larned and Others .
    Of the application of the statute of limitations to an action by the holder of bank notes, against the directors of the bank, by whose misconduct the bank had failed. [It seems, where the action is brought against the corporation, the statute of limitations cannot be pleaded.—Ed.]
    The plaintiff alleges, in his declaration, that the defendants and sundry other persons were, by an act passed on the 25th of February, ] 806, incorporated and made a banking company, by the name of “ The President, Directors and Company of the Berkshire Bank; ” of which company the defendants were the president and directors; that sundry bank notes were by them issued and put in circulation ; and that, in conducting the affairs of said corporation, the defendants exceeded their powers, thereby causing the failure of the bank, and a consequent loss to the plaintiff; he being the holder of certain bills or notes of the corporation, particularly set forth and described
    The action was submitted to the decision of the Court upon the following facts. The defendants, with other * per- [ * 66 J sons, were incorporated as stated in the declaration. The present action was commenced in June, 1817, and is brought upon divers notes issued By the said corporation, payable on demand, signed by the president, and countersigned by the cashier ot me bank. The said notes were issued more than six years before the commencement of the present action. In the year 1809, and within six years from the date of said notes, the Berkshire bank failed, and ceased paying their notes, and from that time forward, had no banking house or public place, or agent, at which, or of whom, payment of the said notes could have been demanded; and the failure of said bank was a matter of public notoriety. Several of the defend ants, directors of the bank, together with the cashier, have resided in this county, from the failure of the bank until the commencement of this action.
    If, upon the foregoing facts, the Court should be of opinion that the plaintiff’s action is barred by the statute of limitations, he was to become nonsuit; otherwise the defendants were to be defaulted, and judgment rendered against them for the amount of the notes declared on.
    
      Dwight, for the plaintiff.
    The thirteenth section of the act mcoiporatingthe Berkshire bank , gives an action against the directors, after a judgment recovered against the company, and an execution returned unsatisfied. The absolute failure and shutting up of the company is equivalent to execution unsatisfied. Besides which the corporation, by the terms of its creation, ceased to exist in October, 1812. It will not be said that the corporation could plead the statute of limitations, merely because the notes sued bore date more than six years before action brought. The uniform practice of all the banks to re issue their notes as often as they have occasion to pay out money, would be sufficient to prevent the application of the statute. And further, the cashier may be considered as a subscribing witness to the president’s signature, and * this last only [ * 67 J makes the promise of the corporation. The cashier subscribes for no other purpose. He cannot sign as a promiser; for he ;s neither a stockholder nor a director. If then the corporation, if sued, could not avail themselves of the statute, it is highly unreasonable that those who represent them, their servants, and who come in their place, should be in a better condition.
    
      The company failed in 1809, and no demand could have been made, by which the statute might be avoided. It was the fault of the corporation, and neither they, nor their servants, ought to derive a benefit from it . If the contract itself is not barred, the remedy against the substitutes of the corporation should not be denied . The present action, being founded in maleficio, is not within the statute. Nor is it within the mischief to be remedied There can be here no loss of vouchers, nor danger of perjury 
    
    The defendants, by shutting up their place of business, must be considered as virtually absconding from the commonwealth, and thus to have avoided a demand.
    
      Gold and Noble, for the defendants.
    
      
       This case should have been reported as of the last September term in this county.
    
    
      
      
        Stat 1805, c 44.
    
    
      
       7 Mass. Rep. 515, Dwight, Adm., vs. Clark.
    
    
      
       3 Mass. Rep.271, White, Admx., vs. Bailey.
      
    
    
      
       Vide Bar.. Abr. Limitation of Actions, D. 3.—2 Mod. Rep. 212, Cochran vs. Welby
      
    
   Wilde, J.,

delivered the opinion of the Court.—The question raised in this case depends on the application of the statute of limitations, it having been agreed by the parties that if, in the opinion of the Court, the action is not barred by the statute, the defendants should be defaulted, and that judgment should be rendered for the amount of the plaintiff’s demand. This may perhaps be considered as an admission on the part of the defendants, that the plaintiff had .originally a good cause of action. Whether this admission is sufficient to authorize the Court to enter judgment in favor of the plaintiff, supposing his claim is not barred by the statute of limitations, may be justly doubted; unless a sufficient cause of action is disclosed, to authorize such a judgment. For if the plaintiff’s title be defective, the opinion of the Court on a collateral point must be considered as extrajudicial, and of no avail.

| *68] *We have not, however, bestowed much attention upon this point; because, on considering the principal question, we are of opinion that, whatever right of action the plaintiff might originally have, it is now barred by the statute of limitations. And this, I think, will appear equally plain, whatever may be the light in which the plaintiff’s claim is viewed.

And", first, supposing the action to be founded on the equity of the act incorporating the Berkshire bank; and this is the most obvious ground for the plaintiff, and such as will best support the declaration. And if it can be supported at all, it must be on the ground that the bank having ceased to exist as a corporation, an action will now lie directly against the defendants, without first proceeding to judgment against the corporation, as required by the charter; and if so, then the present action accrued so early as the year 1809, when the bank became insolvent, and such insolvency became pubicly known and acknowledged. Since which time the defendants have done nothing, whereby they could have charged themselves. And if the defendants can protect themselves by any lapse of time under the statute of limitations, it is certainly a sufficient defence in this case.

But it is said that the statute of limitations is not applicable to demands on bank notes; and perhaps there can be no great doubt that such is the law, where the action is brought against the corporation ; because the circulation of such notes is daily renewed; and because lapse of time is no presumption of payment, these notes never being paid, unless given up by the holder at the time of payment But where the action is brought against the directors, and is founded on their supposed malfeasance or negligence, there can be no distinction that we can perceive in the application of the statute of limitations, between such a case and any other special action on the case.

It has been argued, that the defendants’ proceedings are commonly recorded in the books of the bank, and * there- [ * ©9 ] fore their conduct may be explained by the books ; so that the defendants would not be affected by the death of witnesses, or the treachery of their memories. But it must be remembered that the books of the bank are not records, and that they may be contradicted by oral testimony ; and therefore, if the directors could not protect themselves under the statute of limitations, they might be called to account for their conduct at any time during their lives, and after such a lapse of time as might put it out of their power to explain their proceedings, although originally they might have a good ground of defence. This certainly would not be reasonable, and it is directly in opposition to the letter and spirit of the statute of limitations.

Again, it has been argued by the counsel for the plaintiff, that the liability of the defendants must be considered as co-extensive with the liability of the corporation. But this is not so ; for their respective liabilities stand on different grounds ; the one being bound to pay the notes issued and put in circulation absolutely, and without any collateral proof; and the others being under no obligation whatever, unless they had transcended the limits of their powers as directors.

But it has been further argued that the defendants, having misbehaved in managing the affairs of the bank, cannot set up the act of incorporation in their defence, but must be treated as a private association, and are therefore liable to the payment of their notes absolutely ; and so that the statute of limitations is not applicable for the reasons before given. We are, however, very clear that the plaintiff cannot take this ground, whatever may be its solidity; for it is in direct opposition to the declaration, which alleges expressly that the defendants, with others, were incorporated, &c. The plaintiff is therefore estopped to allege that the defendants had no charter. In this action the defendants must be treated as the officers of a banking institution, duly incorporated, and can only be liable' [ *70 ] according to the laws applicable to them in * this capacity. It might, however, be doubted whether they would be liable in this case, were they the officers of a private banking company ; for the action in such case ought to be brought against the whole company; unless brought against the officers, on the ground that they had issued the bills without the authority of the company ; in which latter case, the defendants might most clearly avail themselves of the statute of limitations.

Upon the whole, therefore, there seems no doubt that the stature is in this case a sufficient bar ; and we exceedingly doubt whether the action can be supported on any ground. For it is a well-settled principle, that where a new right is given, or a new duty imposed, by statute, and a remedy is provided to enforce such duty, or for the violation of such right, that remedy must be pursued. Now, there is no pretence for saying, that this action can be maintained by the principles of the common law, independent of the provisions of the statute. If all the allegations contained in the declaration were admitted, they are clearly insufficient for this purpose. At most, the) only show an unfaithful management of the funds of the bank, which might lay the foundation of an action by their associates; but not by the holders of their bills, whose temedy in such case would be on their securities.

We do not, however, make this a point in the cause, since we have no doubt that, whatever may have been the plaintiff’s right, it is effectually barred by the statute of limitations. According to the agreement of the parties, the plaintiff must be called.

Plaintiff nonsuit.  