
    
      John N. Williams et al. v. J. Eli Gregg.
    
    Columbia,
    Nov. 1848.
    The books of an agent, kept by himself, or those acting under him, are not, in general, evidence for him of the disbursement of money on account of his principal: he should prove his disbursements by strictly legal evidence. — Vide Bail. Eq. 226.
    An agent, accounting in' Chancery, may discharge himself, by his affidavit, without voucher, when the amount of the item is under forty shillings. Where an agent is continued from year to year, and finally withdraws voluntarily from his office, he is entitled to the compensation agreed upon for Ms services, and liable only for specific loss by his misconductor neglect, which must both be alleged and proved.
    Although the general agent of a company is not responsible for the bad debts, or for the negligence or faithlessness of agents whom he has necessarily employed, yetit is his duty to see that the debts due to the company are collected, and he must show that he exercised ordinary diligence for that purpose.
    An agent is not responsible for a contract made with an infant, known to and acquiesced in by the principal; especially where the contract was conditional, and no actual loss resulted from it.
    
      Before Caldwell, Oh. at Darlington, February /Sittings 1848.
    The bill was filed on the '21st November, 1844, by John N. Williams, William Munnerlyn, Smith Mo wry, Brown Bryan, and the personal representatives of Johu McLena-ghan, stockholders in the Planters’ and Merchants’ Steamboat Company, against J. Eli Gregg, also a stockholder.
    It states the incorporation of the company for the purpose of navigating steamboats between Cheraw and Charleston, capital $20,1)00, with authority to increase it to $60,000; the appointment of the defendant, Gregg, President and general agent for the purchase of a boat, and for the entire management and superintendence of the business ; his receipt of the capital stock ($20,000); that, throughout the whole time of the company’s active existence, he, Gregg, was sole agent of the company; that all persons acting in the business of the company were his agents, for whose acts he was responsible ■ that he represented that for sixteen thousand dollars he eould procure a suitable boat ready for operation, or had contracted for one such; the company accepted the contract; the “ Anson” steamer was obtained and commenced running; and that Gregg never informed the company, nor any member, that the Anson cost any more than $16,000, until the company were about to discontinue their business; .that at an early period in the progress of the business, Gregg represented that their business had then yielded a profit of ten or twelve thousand dollars, and at his instance, another steamer, the ‘Swan,’ was purchased by him; and the said Gregg, as agent, continued for some time to run both boats; that defendant received also all the moneys accruing from freights, passage money or otherwise; states further the interest of complainants severally in the Stock; the determination of ,the company to discontinue the use of their charter, and close their business; that they accordingly sold the boats, &c.; that afterwards, upon the representation of Gregg, that it was necessary, in order to pay the debts, complainants paid to him five hundred dollars on each share owned by them ; that he has been applied to for an account of his agency, which he has refused ; prays that defendant may answer, may account fully for all moneys received by him belonging to the company, and for all moneys due and owing to the company ; and may be decreed to pay over to complainants, according to their respective rights, any balance found.
    Defendant’s answer, filed on the 9th of January, 1845, admits the incorporation; his election as one of the Directors, and his appointment as President by the Directors; while such he acted as superintendent of the concerns of the company on the river, with necessary and subordinate assistants; but denies that he was sole agent, or responsible for others employed in the business of the company; says that LaCoste was at first agent at Cheraw; he gave it up to Bryan, without consulting defendant; that the bye laws provided for yearly election of officers; that but one election ever took place; that defendant acted as President until January, 1841, when he resigned his office and agency and left the State, having given up the books of the company to Brown Bryan ; denies any representation by him as to what the boat would cost; says that the Anson cost more than defendant expected ; assigns some reasons why he could not give as much personal attention as he desired; that when the building of the Anson had already cost more than $20,000, and more money was called for, defendant consulted with two members of the company, viz: LaCoste and Bryan, who, as he supposes, knew as much about the cost of the boat as defendant did ; denies any intention or desire to conceal any fact from the company; says that the books embracing the accounts of his agency were kept in Cheraw, where most of the members resided, and that they were accessible at all times ; that at the suggestion of LaCoste, and with the assent of Bryan, S. Mowry was appointed agent, in Charleston, to superintend the completion of the boat, LaCoste writing to Mowry for that purpose; that the Anson cost, according to the best estimate defendant can make, about $29,000: that he can’t say certainly what she did cost, because she was partly paid for by Barden, the captain, out of the profits made, and in Barden’s account, the settlement of which was made with S. Mowry, but revised by defendant, the expenditures on account of construction and on account of navigation, are so blended that defendant can’t accurately distinguish them; that defendant did, at one time, think the company was doing a “ fair” business, and may have so said to complainants, but he had no better means of judging than they, as the books kept by him were always open to their inspection ; denies that he ever designedly deceived any of the members by mis-statement or concealment of facts; does not recollect or believe that he ever estimated the profits at any particular' sum ; did recommend that the company should get another boat of lighter draft than the Anson; and, upon consultation of the company, it was determined to build one ; the Swan was accordingly built at a cost of $12,000 ; admits the business proved profitless, but insists he is not responsible morally or legally; that such result is more injurious to himself than to any one else, he being the largest stockholder; that the disastrous result was owing partly to unforeseen causes, against which no prudence could guard, and partly to errors of the complainants, equally as of the defendant; that while in the service of the United States, on the coast of Florida, for wages of $3,000 per month, a shaft was broken, the repairs rendered necessary by which cost $3,500, besides losing the contract; that two tow boats were built for the company in Charleston at a cost of $2,800, and three others bought at a cost of $2,000; one of which was sold to the company by John N. Williams, and another by Brown Bryan ; and these three, being old a,nd worthless, proved a total loss; denies that the whole capital stock came into his hands; says a rule of the company required every captain employed to own at least one share of stock, the original value of which was $1,500; accordingly one share was reserved for the captain ; that when Barden ceased to be captain, this share was accounted for to the company; afterwards W. Lubbock being appointed captain, this share was transferred to him, but he never paid for it; when defendant gave Lubbock a certificate of stock for this share, it was on condition it should be first paid for; and never having been paid for, it remains the property of the company, and the common loss of all; files, as an exhibit A, a true statement of the capital stock actually paid in, and its disbursements; .idenies that defendant received all the moneys accruing from freight, passage, &c., but says that_ nearly or quite all the down freights Avere received by S. Mowry in Charleston, and if any was paid by Mowry to defendant it is charged against defendant in the books; that part of the freight was received at Cheraw by LaCoste, and part by Bryan, and all the passage money and some of the freight was received by the clerk of the Anson, and by him accounted for; and these receipts by the clerk, defendant believes, were not enough to pay current expenses of the boat; some of the freight was received by agents in Georgetown; that the books of the company, kept at Cheraw, show all the monies received and disbursed by defendant on account of the company, except a, small sum of $150 or $200, disbursed on board the Anson, which cannot be accounted for, because the Anson’s books are not in defendant’s possession, but, as defendant is informed, are in the possession of S. Mowry; admits the sale of the boats, the proceeds of which have been applied to the payment of debts ; says that $1000 per share was assessed on fifteen shares (Lubbock’s share not being assessed) for payment of out-standing debts ; denies that all this passed through his hands; received only one-half the assessment on McLenaghan’s stock, five hundred dollars and some interest, which, with the six thousand dollars ($6,OUO) assessed upon defendant’s own stock, has been applied by him to the company’s debts ; is satisfied that the assessments on the other stockholders have been so applied, except that of Bryan, which defendant insists Bryan may be decreed to pay; says that, since the assessment, he has paid debts of the company, and that the company is indebted to him, and prays an account and payment; says that the books of the company, kept- by defendant and Bryan, are in the possession of some of the complainants, and he has been refused the use of them, without which it is impossible for him to account fully; prays a general account from the company; that Mowry and Bryan may account; insists that Dunlap & Marshall and Lubbock shall be made parties; corrects the statement of the proportion in which the stock is owned ; says he has always been willing and anxious to account, and has several times proposed to do so, and is now glad complainants have appealed to the law.
    At February Term, 1845, the following orders were made by the Chancellor:
    “ On motion of G. W. & J. A. Dargan, defendant’s solicitors, it is ordered that all the books and accounts, and other documents of the Planters’ and Merchants’ Steamboat Company, mentioned in the defendant’s answer as being necessary to the defendant’s making a full and complete answer, and under .the control of the complainants, be placed in the office of the Commissioner of this Court, so that the said defendant may have access to the same for three months from the first' day of March, next, and that the said defendant have leave to file a further answer to the complainants’ bill.”
    (Signed) DAYÍD JOHNSON.”
    “ On motion of Mclver, solicitor for complainants, it is ordered that J. Eli Gregg, the defendant in the above stated case, do deposit with the Commissioner in Equity for Dar-lington District, on the first day of March next, the books containing the bye laws of the company, mentioned in the bill, and also that he do deposit with the said Commissioner, at the same time, such other books as he may have in his possession belonging to said company, and that the books, so deposited by the said defendant, shall remain in said Commissioner’s office for the space of three months, subject to the inspection of the said company. It is further ordered, that the defendant do make his return to this order on oath, and that the accounts of the said Gregg be referred to the Commissioner. 14th February, 1845.
    (Signed) DAYID JOHNSON.”
    Defendant’s supplemental answer, filed 29th July, 1845, states that the exhibits filed therewith marked AA, A, B, C, D, E, F, G, H, together with the exhibit filed with his former answer, “constitute a full, true, and perfect answer, to so much of the complainants’ bill as prays for an account from this defendant as agent and member of the said company.”
    Complainants, on the 12th January, 1846, filed an amended bill, and had a new service of subpoena on defendant. The amended bill makes Dunlap & Marshall and W. Lubbock complainants; repeats in a more ample and distinct manner, the statements and charges of the original bill; adds that original stockholders were induced to enter upon the enterprise by defendant’s representations of the profits to be realized, and by their confidence in the judgment, integrity and skill which defendant, as president and agent, would bring to bear upon it; that defendant was to receive a stated salary; that he directed and controlled all the business of the company, appointed all agents, made all contracts, governed the movements of the boats. &c.; that he never made to the company any exhibit of his acting, and altogether neglected to place before the stockholders any statement by which they could inform themselves of the state of its business, only saying generally to them as to others, that the boats were doing a prosperous business, and that the stock was very valuable; that the two steamers continued running from the day of 1838, until 1st July, 1841, the defendant all the while having the sole direction, control, and management of the whole business, for a compensation paid him by the company ; that if the business were really unprofitable, from causes for which defendant was not responsible, he carefully avoid-' ed giving the least intimation of it, and went leisurely on to the certain wreck of their interests, although he knew that complainants trusted entirely to him to take care of those interests and to warn them of danger; that they never suspected that the business had not been skilfully managed, and that the expectations excited by defendant’s representations were unfounded, until about 1st July, 1841, when they discovered for the first time, that the whole capital had either been sunk under his unskilful management Or otherwise disposed of by him; that he has been applied to to account for capital, assessment of contributions, freight, and passage money, which he either collected or failed to collect from neglect or mismanagement of himself or his subordinates, and that he refuses such account; charges, in addition, “ that complainants were deceived by defendant as to the original cost of the Anson, and that he unnecessarily paid away a much larger sum therefor than comported with the business in which they were about to engage, and his own representations as to the cost; that he negligently and unskilfully purchased a boat of such dimensions as were obviously unsuited to the navigation of the Pee Dee river, and of a style and finish incompatible with the business had in view by the company; that the company employed no agent but Gregg; that he only, had power to appoint, and did appoint, all subordinates, and should account for them ; that he is bound to account for all debts due to the compamy which he has not diligently endeavored to collect; that he is reponsible for all losses sustained by unskilful management, or for such a concealment of the actual slate of their aifairs as resulted in loss, whilst he was making such general representations of the business as he knew would lull them into security.” Prays that defendant may account for all uncollected debts, and for all losses resulting from the unskilfulness or neglect of himself or his agents, or his concealment or misrepresentation of facts concerning the business of the company, besides the prayers of the original bill.
    In the progress of the references before the Commissioner on defendant’s accounts, he, [defendant,] deemed it necessary to have discoveries from S. Mowry and J. N. Williams, two of the complainants, touching certain items in his accounts. For this purpose he filed a bill in Charleston, on the 26th of August, 1846, against Mowry, requiring said Mowry to discover whether he did not receive from defendant for the company, the following sums, to wit, $1000 on the 6th Septr. 1838, $600 on the 19th Septr. 1839, $418 96 on the 6th Nov. 1841, and $18 66 on same day to pay a debt to Guerry; stating that Mowry’s account in defendant’s possession admitted the receipt of the sum of $1000, but did not show from whom received ; that Mowry’s solicitors had a copy of his account, which they refused to show on the reference, and were seeking to strike out these items from defendant’s account as insufficiently proved; that he had applied to Mowry for acknowledgments or vouchers to sustain his charges, which he, [Mowry,] had declined or omitted to give.
    Mowry’s answer, filed 25th September, 1846, denies receiving the sums of $1000 and $600,"as stated in the bill, or having admitted in any account rendered, such receipt; says he received from A. P. LaCoste $1000, on 17th Septr. 1838, and credited it to the company in his accounts, and that on 19th Nov. 1839, he received $689 06 from freights collected, and credited it to the company; admits that on the 10th Novr. 1841 he received from Gregg $436 90, of which sum $18 96 was paid to Guerry; denies any application by Gregg to him for acknowledgments of the charges set forth in his bill, and that he ever refused to answer such application; admits receiving from Gregg a letter dated 17th June, 1846, in which he asked an acknowledgment of the receipt of the item of $437,60, and says that he, Mowry, by letter, dated 29th July, 1846, acknowledged his receipt of the sum of $436 90, as before mentioned, of which letters copies are exhibited.
    The bill against J. N. Williams was filed 8th February, 1847, and seeks a discovery whether a certain statement and settlement on page 32, ledger B, of the company (of which an exhibit is filed) was not made at Williams’ instance and under his inspection and in his presence; whether Gregg did not go to W.’s store with the books at W.’s request; whether the settlement is correct; whether it was not, at the time, believed to be correct; if not correct, wherein is it erroneous ? if W. did not claim credit for a payment of $700, made to Watchman & Bratt through Bryan; whether that payment was not intended as a credit on W.’s note Of $974 33; if he ever paid any part of said note to Gregg; if so, how much, when and where; whether he had paid any part of said note to any one else; how much, when and where and to whom; whether the said note was not in Bryan’s possession, where the note then was, and if he, W. had ever taken it up. Also a discovery, whether W. did not sell the pole boat General Jackson to the company, in the spring of 1838, at least as early as June; whether the settlement, in which the boat was paid for, was not some time after the sale; whether she was not sent to Georgetown for repair, and whether she did not need repair. The bill does not state any previous application to Williams for the information sought.
    The answer of Williams filed 8th February, 1847, protests that Gregg’s resort to a bill of discovery was wholly unnecessary, as defendant was present at the reference when the information, now sought, became necessary, and was willing and offered to testify and discover; says there has been no settlement between himself and Gregg, in reference to the Company transactions, since that at which he gave his note for $974 33 to Gregg — admits that, at G.’s request, he put into Bryan’s hands $700, to be paid to Watchman <fc Bratt; supposes that payment was to be credited on the note, but remembers no agreement or understandingto that effect, at the tjme . ¿oes n0); ii[10w that said note was ever in Bryan’s possession, nor what has become of it; believes it has been paid tQ Qregg) as he does not remember ever having paid any thing for company account to any one else,’except the $700. As to the correctness of the settlement, he, W., knows nothing; says that he was entitled to the two credits of $178 83 and $42, as appears from a settlement made with G., before the date of the note of $974 33 ; that the settlement on page 32, ledger B, was not made in his W.’s, presence, and he has no knowledge on the subject of the making of that settlement. As to the pole boat, answers affirmatively as to the time of sale and payment; knows nothing about her needing repairs or being sent to Georgetown for that purpose; affirms that Gregg, before the “ Swan” was bought, represented to W. that he, Gregg, as agent of the company had in hand the sum of $12,000 profits arising from the company’s business, and consulted whether they should declare a dividend or purchase a boat better suited to the river, which G. said could be done for $7,000 or $8,000 ; denies that he, W., ever expressed himself satisfied with the agency of Gregg ; but says, that once, in the presence of J. J. Marshall, he, W., said that if G.’s accounts were all straight, as Marshall then stated was the case, he, W., could only conclude that G. was totally wanting in capacity for the management of a business of such magnitude; that in February, 1840, Gregg stated to him, W., that the nett profits of the company then were $3,000 per month, and the only debt due was one of $4,000 to Mowry.
    On the 20th January, 1848, E. A. Law, Commissioner, filed his report upon the defendant’s accounts, to which report, on the 15th February, 1848, the complainants and defendant filed exceptions. On the same day, the Commissioner brought in his report upon the exceptions; and, in this condition, the the case came on for a hearing before his Honor the Circuit Chancellor, who rendered the following decree, on the day of 1848. The exceptions are embodied in the decree.
    Caldwell, Ch. This case comes up on the report of the Commissioner, and fourteen exceptions on the part-of the plaintiffs and two on the part of the defendant, and the report thereon. The original bill was filed by the plaintiffs, on the 21st Nov. 1844, and the amended bill on the 12th of January following, against the defendant, for an account of his actings and doings as agent and superintendent of the “Panters and Merchants Steam-boat Company,” and for the moneys received by him as the capital stock, and assessments upon the shares, for freight of goods, fare of passengers, and for all moneys received by him belonging to the company, and for all moneys due and owing to the company, &c. This company was incorporated by an Act of the Legislature, in 1837, and the capital was $20,000, with the privilege of extending it to any amount not exceeding •$>60,000; and defendant was elected President, and constituted general agent for the purchase of a boat; and he was entrusted (as the plaintiffs, who are stockholders, allege,) with the entire management and superintendence of the business. The capital stock of $20,000 was paid in and assessments were made on the shares.
    Reference must be made to the bills and answers, accounts, and the voluminous testimony taken, as they are too massive to be embodied in a decree, and I shall therefore only refer to them when they are material.
    
      The plaintiffs’s exceptions are :
    
    1st. “Because the Commissioner hath in his said report certified that certain books of account, to wit, day-book, journal and ledger, were admitted as evidence as the books of the company; whereas they were the books only of individual agents, either the said Gregg himself or those acting under him.”
    It it self-evident that the business of such a company could not be managed without suitable books, and the proof is sufficient to .shew that these were the books of the company. A printed label of the name of the company was on the books, the entries in them are in favor of the Steam-boats Anson and Swan, and pole-boats that belonged to the company, and made by Bryan, one of the plaintiffs, and by Lacoste, and their clerks ; and above all, the witnesses identified them as the ioo/cs of the company, and the plaintiffs themselves produced and delivered these very hooks under an order of the Court, made in 1845, that all the books and accounts and other documents of “The Planters’ and Merchants’ Steamboat Company,” mentioned in the defendant’s answer, be placed in the office of the Commissioner, so that the defendant might have access to them, <fcc.
    These books were recognized by the company, and under the bye laws subject to the inspection of the stock-holders at all times. It would be difficult to conceive of more conclusive proof of the books belonging to the company than what has been offered. The. exception is overruled.
    2d. “Because the Commissioner hath in his said report certified, that the small book marked A, was admitted as evidence to establish certain of defendant’s charges, as a book of the company; whereas it should have been rejected, as only a private memorandum book of the defendant, not purporting to contain all his transactions.” There is no reason to reject a book because it does not contain all the transactions of the company ; generally no book does contain all; every book has its appropriate use, and there is no rule oí ]aw that requires a certain number .of books to be kept and no others, and no bye-law of the company required it. In conducting a large and extended business, for such a company as this, which had many branches and subordinate agencies, more than the ordinary number of books would have to be kept, and the entries in this book were certainly not the private memoranda of the defendant, for they were connected with the affairs of the company, and were made in the hand-writing of several other members and agents of the company, which properly gave it the character of being a company book; it contains the only account of the disbursement of the original stock. Its genuineness is conclusively confirmed by the original entries made in it being transferred to the other books of the company. From the appearance of the book, and the mode and matter of the entries, nothing could be inferred against it, and there is no ground to suspect that it was a fabrication, and the Commissioner reports that the only circumstance that has had the slightest effect in discrediting it, is the fact that it was not (according to the Commissioner’s recollection) lodged in the Commissioner’s office at the precise period fixed by the order of the Court. The defendant’s answer refers to and relies upon the entries made in this book, which has been recognized as one of the company’s books by the corporators and their agents using it, and a large part of the charges contained in this book ivas established by satisfactory vouchers and parol evidence. This exception is overruled.
    3d. “Because the Commissioner hath in and by his said report certified that he has allowed the defendant sundry charges of postage, whereas the said Commissioner ought, upon the evidence before him, to have rejected said charge as not proved.” The charge was $45,00, for six quarters postage. The amount was not only reasonable, according to the evidence of the extensive correspondence, but defendant offered to produce all his letters relating to the business of the company, which the plaintiffs did not require, and in addition to this, the charge was proved from the entries in the books. There can be no sufficient reason why the company should not pay for their own postage, as well as a bank ora partnership; and it would seem to be unreasonable for their President and general agent to bear this burden, unless he had expressly stipulated to do so. The exception is overruled.
    4ih. “Because the said Commissioner hath in and by his report certified that he has allowed charges of defendant under $10, on the 40s rule established in the English Court of Chancery, upon the defendant’s own oath, whereas the said rule is not known to the practice of our Courts of Chancery.”
    
      2 Cases in Ch. 249, 1678. n,--i fb.28¿ 2Atk. 410. 2 ^^Ch. 2 story’s’ Eq. J- 743. Joh^C. R.
    The rule is well established in England, that a defendant on account shall be discharged by his oath, of sums under, forty shillings. One of the earliest cases was an account between the plaintiff who was a gardener, and the defendant a seedsman. The latter was allowed sums sworn to under that amount, by way of discharge, but the former was not allowed for trees sold and delivered, without other proof than his own oath. The rule is however subject to these tions; the defendant must swear positively that he has actually expended the sums, and must specify to whom, and when paid, the whole of the items so established must not exceed £100, and thei e must bo no reasonable ground to doubt the defendant’s oath. Chancellor Kent, in Reinsert v. Rem-sen, suggests that as forty shillings sterling was the sum tablished in the early history of the Court, perhaps twenty dollars would not be deemed an unreasonable substitute. Our Act of 1721 provided that the Court of Chancery “shall proceed, adjudge and determine, in all causes brought into the said Court, as near as may be according to the known-laws, customs, statutes and usages of the kingdom of Great Britain ; and also as near as may be according to the known and established rules of his Majesty’s high Court of Chancery in South Britainand by this we must be controlled, unless the practice of the Court has been changed, either by statute, by decisions, or by our own rules of Court. There has been no statutory provision on the subject of the 40 shillings rule, nor any decision of our Courts reversing it; but it has frequently been adopted in practice; although I can find no case in which it has been expressly considered and decided by the Court of Appeals. In the case of Wright, v. Wright it constituted one of the reasons for the Court sending the case back to the Circuit Court, and remanding the accounts to the Commissioner; and in conformity to this view of the practice, the rule was adopted in discharge of the accounts of an administrator on oath, in the case of Neal and wife v. ¡Saunders, administrator, in which the parties acquiesced. The reason of the rule is manifest; so small a sum. would generally be too slight a temptation to commit perjury. The fiduciary relation that the defendant has occupied, raises the presumption that he is certainly worthy of credit on oath for that small amount, when the parties have entrusted him with a hundred times as much without an oath; and moreover, that it would in many items, cost as much to obtain the witness’s attendance to prove the amount under 40 shillings, as the sum established by his testimony. The limited amount and the mode of administering justice within the jurisdiction of a magistrate, may also furnish an analogy. Many of these items were vouched, and no proof was offered to rebut the defendant’s oath. The exception is overruled.
    
      5'th. “Because the' said' Commissioner hath in and by his said report certified that he has allowed defendant’s charge of $400 in schedule D> as paid to S. Mowry, Jr. whereas the said Commissioner ought to have rejected the charge as insufficiently proved.”
    This sum was entered in the books of the company as having been paid to S. Mowry by draft on Kirkpatrick Co., and the defendant held the account of S. Mowry against the company, in which this sum was credited generally as having been paid by a draft on Kirkpatrick & Co., without stating from whom the draft had been received, and the balance was struck. This certainly was sufficient to raise a strong presumption that defendant paid it, as he was of all the stock-holders, the only one that should pay i!, and especially as no other member has pretended or claimed to have paid it. The entry in the books is supported by the receipt, and corroborated by the circumstances, so as to leave no reasonable doubt of the defendant having paid it.. This ex-fcion is therefore overruled.
    6th. “ Because the said Commissioner hath in and by his said report certified that he has allowed the defendant’s charges of $600;, $300, and $800, for services; whereas-, the said defendant was net entitled to this compensation.”' This exception, like the preceding; is a question depending upon the evidence, which is clear and conclusive, as to what the de> fendant was to receive, how long, and the manner in which he served. The charges were entered in the book before the assessment was made in 1841; the-plaintiffs admitin their amended bill that he was to be paid $600 per annum, and the testimony of LaCoste, Henning, Douglass, and others, prove that his services were worth that amount.— This exception is overruled.
    7th. “Because the said Commissioner hath in and by his said report certified that he has allowed the defendant’s charges of payments to-B\ Barden ; whereas, the-said charges of payments ought to have been rejected as insufficiently proved.” This exception depends upon the evidence furnished by the books, by a receipt in defendant’s possession, and by the examination of F. Barden ; which, taken together, is sufficient to. establish them. This exception is overruled'.
    8th. “ Because the said Commissioner hath in- and by his said report certified that he refused, to charge the defendant with the unsettled accounts or debts due to the company; whereas, upon the evidence as to defendant’s duty, he ought to have been required to account for them, or to explain why they had not been collected.”
    There is no proof that the defendant has received any of the assets of the company for which he has not accounted, and before he can be held accountable for debts due them, they must establish his laches. His agency terminated in January, 1841, and there were other agents of the company, who were as much bound to collect the debts as the defendant; and there was no proof that any of the accounts were lost by his neglect; and the testimony of LaCoste, Henning, Wingate, and Douglass, exonerate him from such a charge ; and when it is remembered that he owned 6-15ths of the stock, no one had so much interest at stake, or had so strong an inducement to collect the debts as he had, and he is the greatest sufferer in the losses of the company. After his agency ceased, it was no more his duty to collect the debts than it was the duty of any other Stockholder. This exception cannot be sustained.
    9 th. “ Because the said Commissioner hath in and by his said report certified that he has charged the defendant only with his own receipts and disbursements, not those of La-Coste and others ; whereas, upon the evidence, LaCoste and others, acting in the business of the company, were sub-agents of defendant, and accountable to him only.” The defendant’s agency was one of a general character till January, 1841; but from the nature of the business of the company, it was indispensably necessary that other agents should be employed to attend to it likewise; and' their liabilities to account to the company did not devolve upon him; he discharged the functions of his own agency; and for the performance of the duties of the other persons, who had been necessarily employed in the management of the concern, the company must resort to them respectively. It would be just as reasonable to make the President of a Bank responsible for the default of the out-door clerk, as to hold the defendant liable for the captain of a boat not accounting for the delivery of freight, or the passage money which ■ he had received.— The rule is, that where an agent appoints another to do his duty, and substitutes him in his place, he is liable for his negligence or default • but here there is no proof of that kind; indeed, the whole weight of the evidence goes to. show that defendant exercised great 'industry, diligence, and perseverance, in discharging his duty, and so far from falling short of doing what he was bound to perform, he did much more. In addition to this, the plaintiffs have failed to prove any specific acts of negligence, or any actual loss or damage resulting to the company from the misconduct of the agents.— The exception is overruled.
    10th. “ Because the Commissioner hath in his said report certified that he has allowed defendant’s charges of articles furnished and payments made, on the evidence only of defendant’s own entries in the book A, and the other books produced on the reference ; whereas, he ought to have held such, evidence insufficient for the purpose.” These books have t)een) from the organization of the company, subject to the 'inspection of the Stockholders, and have been established to pe tjie fr00ps kept by the agents of the company, and as they charge the defendant with his receipts, it would-seem they ought to be competent to credit him with his disbuisements, unless the plaintiffs could falsify them. When the agents make entries in books kept for their principals, which are necessarily connected with the business they are employed to transact, they are to be considered prima facie as if made by their principals ; and if such entries are sufficient to bind third persons, they certainly ought to bind the parties, particularly with such strong circumstances of corroboration, many of the items having been vouched, some proved by the witnesses, and all sworn to by the defendant, and no proof on the part of the plaintiffs to rebut the truth of his answer. This exception is overruled.
    11th. “ Because the Commissioner hath in and by his said report certified that he has allowed defendant’s charges contained in exhibit F ; whereas, the evidence upon which, as appears by the said report, these charges were allowed, ought to have been held insufficient.”
    These disbursements, in the aggregate, amount to $>1417,-07; in 1838 are entered in the book A, and transferred, on the first of January, 1839, to the journal, and from thence to the ledger. LaCoste made entries, under the transfer, in the journal. In addition to this, some of these demands were proved by receipts, others'by evidence of witnesses, and many of them came under the amount of forty shillings, and there, was no evidence offered on the part of the plaintiffs to rebut this proof, or to raise a presumption that the items were improperly charged. This exception is overruled.
    12th. “ Because the said Commissioner hath in and by his said report certified that he allowed the testimony of Wm. Godfrey, taken by commission, to prove the payment by defendant of three notes in the bank, which notes the said God-frey testified were not in the bank at the time of testifying; whereas, the said Commissioner ought to have required the production of the books of the bank, from which the witness professed to speak, and the notes themselves; which, if paid by defendant, were presumptively in his possession.”
    The company owed the notes in the Bank of Cheraw, none of the Stockholders claimed credit for their payment but defendant, who was the general agent of the company, and ought to have paid them ; he had credited himself with the amounts, and had some of the renewals in his possession, and it was expressly proved by Godfrey that he paid them. The exception is overruled.
    
      13th. “ Because the .said Commissioner hath in and by his said report certified that he has refused to charge the defendant witli the note of W. Lubbock ; whereas, the said Commissioner ought to have charged defendant with the said note, as taken by him from one that defendant knew to be under age at the time, and who, upon that ground, refused to pay it/’ The Commissioner states the circumstances under which the sale of a share of the stock was made by the defendant to Lubbock, (who had been appointed captain of the boat, and it had been a bye law or rule of the company that the captain should own a share,) at $2000, which was $500 above par, on the condition that when he paid for it, it should be his. During Bryan’s agency, this note was entered in the journal and transferred to the ledger. It appears that Lubbock was an infant, and turned out tobe insolvent. It is not alledged that the defendant did not act bona fide in the sale, and as no objection was made to what was notoriously known by the Stockholders, that Lubbock was captain, and had bought a share, it would exceed any rule of liability ever presented for agents, to hold that the defendant should make the share good, especially when the contract was conditional, and the title to the share in stock was reserved in the company till Lubbock paid for it; this prudent reservation of the title exonerates the defendant from neglect. and it left the share where the contract found it, and the company cannot complain of any actual loss, and an agent is certainly not liable for any other kind. This exception is overruled.
    14th. “ Because the Commissioner in his said report hath certified that exhibit A, thereto attached, contains a statement of the account between the parties; whereas, in the said statement, the said Commissioner has charged the company with negro hire due the defendant as on the 31st December each year, and defendant’s own salary as of same date, when the said charges, if due at all, were due the first of January succeeding ; and the statement does not contain a charge against the defendant of a sum proved to have been received by defendant of J. N. Williams.” The plaintiffs have not pointed out any error in the calculation of the Commissioner connected with this exception, and he states that there was no evidence before him of any sum having been received by defendant from J. N. Williams, which occurred to his recollection. This exception must therefore be overruled.
    
      The defendant’s exceptions are :
    
    1st. “ Because the Commissioner disallowed the charge of $250, which was charged in the Anson’s books as paid by Gregg for the company, which said charge was transferred to the books of the company.” This exception depends on the testimony of George Douglass, who proved the logs of the h00]c jn which these charges for sundries furnished the boat were entered, that there were other entries in the said book on credp side for passage money received on board by the clerk, which was about enough to furnish the boat with provisions. As no credit had been given the company for the passage money entered in the same book, the Commissioner thought there would be no propriety to allow the charge without allowing the credit, when it might well be that the passage money had been so applied. The witness did not prove the specific entries which made the aggregate of the claim connected with the business : when a party relies upon original entries in a book to support his demand, and the proof establishes credits in the same book sufficient to discharge it, it requires explicit proof before such a claim ought to be allowed. The omis of proof is upon the defendant, and it may be his misfortune that the book has been lost, as he is bound to show clearly how the transaction stood.— Its loss cannot be imputed to the plaintiff’s negligence, and ought not to be perverted to his injury, as it would be dangerous to indulge in conjectures, when the evidence ought to make matters certain. A reasonable doubt of the. correctness of such a claim is sufficient ground, under the circumstances, for its disallowance. The transfer of an aggregate amount, without specifying the items that composed it, to a book of the company, where there has been no accounting or settlement or any act of the company admitting it, cannot have any weight. The exception is overruled.
    2d. “ Because the Commissioner disallowed the charge of three hundred dollars, amount paid John McLenaghan’s note at bank, which was specifically charged in book A and in journal and ledger of the company, as an amount paid for the company by defendant, and for which defendant should have been credited.”
    The payment of a debt of McLenaghan by defendant, did not authorize him to charge the company for so much money paid for their use, without some agreement with them to that effect, and no proof has been offered of any such contract, either express or implied. A question of this sort depends entirely upon evidence, and unless the misapprehension or mistake of the Commissioner is clearly pointed out, or may be fairly presumed from the proof, his report must be considered at least prima facie correct on matters of fact; and no evidence has been brought to my view sufficient to establish this charge. This exception is therefore overruled.
    The next important question in the case is as to the costs. As this is a matter for the discretion of the Court, it must depend upon the circumstances of the case, and the conduct of the parties. After examining the books of the company, it is apparent that they have not been kept by the defendant with either skill or clearness, however honest and fair his intention may have been. That he acted bona fide is presumed, and it was not urged that he did anything with an intention of defrauding the stockholders; he seems to have been by far the greatest sufferer by his own miscalculations ; he represented the business as prospering, and bought other shares some time after the company commenced business.— This, together with his industry and perseverance, indicates that he acted as an honest man, but that he has been mistaken in the calculation of the profits. The business has terminated in a ruinous result to the interest of the stockholders ; but while this disaster is not to be considered as criminal, it is palpable that the complicated machinery of the concern, the number of agents, the high, not to say extravagant, cost of the boats, the want of adaptation of one of them as a river boat, however suitable she was for the sea, the confusion of the accounts and the difficulty of straightening them, and the uncertainty of what were the actual expenditures, even at the hearing, shows that even with good motives, a man may involve himself and his friends in great losses. The stockholders called on defendant to make a showing of the affairs, and he answered the call by proposing to bring forward the accounts, or submit them to the investigation of others. This is sufficient to exculpate him from blame, as to coming to an account; had he refused, he ought to have paid the costs of the case, but from his willingness to account, he exhibits a disposition to do what is right. But for the defective mode of keeping his accounts, the difficulty of showing the plaintiffs how they stood, what had been received, what had been invested in boats, what liad been expended, and what profits had been derived or losses sustained — he was bound to do all this; and if he had been incapable of doing so, he ought not to have assumed the agency. The duty of an agent is plain: he must be able to account to his principal satisfactorily, and ought to show how he has discharged his trust, so as to leave no doubt abou this receipts and expenditures ; and if his principal calls him to aecount before the Court, and he has to ransack the whole-country for proof, that he ought to have taken in shape of vouchers, and been able to exhibit any moment, — he must not expect that his principals should pay for the expense of bringing forward his proof.
    It is therefore ordered and decreed that the report be confirmed, and that the plaintiffs pay their costs, and the defendant pay his own costs.
    
      
      Grounds of Appeal.
    
    From the foregoing decree the complainants appealed, upon the following grounds, viz :
    1st. Because his Honor the Chancellor held that certain books of account mentioned in the proceedings, to wit: those styled day book, journal and ledger, and that distinguished as book A, were competent evidence for the defendant in establishing his account of disbursements and of articles furnished for the company.
    ?nd. Because his Honor held that the 40s. rule, as recognized in the English Chancery practice, is in force in this State, and that, in virtue of this rule, an agent accounting in Chancery, may prove charges of any sums under ten dollars, by his own oath alone.
    3rd. Because, if this rule be in force, a larger amount in gross was permitted to be so proved in this case than the rule itself authorizes.
    4th. Because his Honor held that the defendant was properly allowed compensation for his services as agent, the right to which the complainants insist he had forfeited.
    5th. Because his Honor held that defendant was properly allowed certain charges of money paid to F. Barden, the evidence that payment was by defendant being, as complainants contended, insufficient.
    6th. Because his Honor held that defendant was not bound to account for the debts due to the company, which had not been collected.
    7th. Because his Honor held that defendant was bound to account only for his own receipts and disbursements, and not for those of agents, appointed by him. in the transaction of the company’s business.
    8th. Because his Honor held that defendant was not bound to account for the note of William Lubbock.
    9th. Because the defendant has not accounted for the loss proved to have resulted from an unauthorized use of the boats of the company, in the service of the United States, on the coast of Florida.
    10th. Because his Honor ought to have decreed that all the costs in the principal case and in the ancillary suits for discovery, should be paid by the defendant in the principal case.
    11th. Because the decree of his Honor is, mother respects, pontrary to law and equity.
    McIver, for the motion.
    Dargan, contra.
   Dunkin, Ch.

delivered the opinion of the Court.

The Planters and Merchants Steam Boat Company was incorporated in December, 1837, and went into operation in 1838. The defendant was appointed President, and general agent for the purchase of a boat, and for the entire manage-1 naent and superintendence of the business. He continued in that office until January, 1841, and, in July of that year, the company appears to have been dissolved.

Bail. Eq. R. 226.

2 H511 c R ’

Cheves’ Eq/R. 189-

This bill was filed by the stockholders against the defendant (who was also a stockholder of rather more than a third of the capital) for an account. His salary was six hundred dollars per annum. The cause had been referred to the Commissioner, and several questions arose on exceptions to his report.

The principal objection was because the Commissioner had admitted in evidence, to establish certain charges of the defendant, the books called the books of the company, day-book, journal and ledger, and also a small .book marked (A.) kept by the defendant. This exception was overruled by the Chancellor, and constitutes the first ground of appeal.

The general rule is that the best evidence, of which the case is susceptible, must be adduced. Merchant’s books are admitted in evidence to prove the sale of goods or merchandize, and this was, in some sort, from necessity, but they are never allowed to prove cash loaned, or money paid. But the rule on this subject, and the reason of it, are distinctly stated in Rowland v. Martindale, and we do not desire to depart from it. “As a general rule,” says Mr. Justice Johnson, “there can be no question but that an agent must prove his disbursements by strictly legal evidence. No man of business pays money without evidence of the fact, other than his own knowledge; and the accountability of the agent renders it still more necessary to take and preserve satisfactory vouchers of his payments. With proper attention it is always in his power to do so, and it ought never to be dispensed with.” The case of the Assignees of Keenan v. administrator of Price, is then noticed, and the reason of the exception stated. But the books here tendered constitute no exception. They are not what are properly called corporation books, which record the proceedings of the corporation, but they are no more than the books kept by an agent showing his transactions as such. It is said in the decree, that book (A.) “ contains the only account of the disbursement of the original stock.” How can it •be said that this is the best evidence of the disbursement of twenty thousand dollars % Kerr v. the Steam Boat Company, was a case between the company and their agent. The assumption of jurisdiction by the Court of Equity is there based upon the principle that the agent must be prepared to prove every charge that he has made, and, in consequence of this, he is entitled to the facilities of accounting afforded by the practice of the Court of Equity. If the books, such as those now offered, were evidence for the agent, he would require no aid from the Court of Equity. But we think also that the practice in this State is in accordance with the practice in Westminster Hall, as stated by Chancellor Harper, that the agent “ discharges himself by his affidavit, without voucher, when the amount of the item is under 40s.”

The next ground of appeal is because the defendant had forfeited his compensation as agent.

This ground is entirely too general. It was due both to the defendant and to the Court that the causes of forfeiture should be specifically set forth. But the reply is that the defendant was continued from year to 'year as agent, and ultimately withdrew voluntarily from the office. If there existed general dissatisfaction with his conduct, it was in the^ower of the company to have removed him.. If he has caused any specific loss to the company it should have been alleged and substantiated, and his liability would depend on the proof.

The 6th and 7th grounds of appeal may be considered together. The defendant was the general agent of the company. — all subordinate agents were responsible to him. Thus the defendant says in his answer, that Barden’s account was settled with Mowry, but “ was revised by the defendant.” The company looked to their president and general agent. It was his duty to see that the debts due to the company were collected, and he must shew that he exercised ordinary diligence for that purpose. Of course it is not meant to be said that he is responsible for bad debts, or for the negligence or faithlessness of agents whom he necessarily employed.

But as the defendant is responsible to the other stockhold- ’ ers, and two of the complainants, Smith Mowry and Brown Bryan, who have called him to account, had extensive transactions for the company, it is proper that they should account for those transactions, in order to enable the defendant to render more complete and satisfactory the account of his general agency. In view of this accountability, the defendant, at a previous stage of these proceedings, moved, unsuccessfully, for an order to that effect. This Court is of opinion that, as between them, the defendant is entitled to such order, and it is hereby so directed.

The Court has considered the exception in regard to Lubbock’s note, and are satisfied with the views presented by the Chancellor,

No exception whs taken to the Commissioner’s report in relation to the unauthorized employment of the boat on the coast of Florida. It should have been made a specific charge, and an opportunity thereby offered to the defendant to justify, or exculpate, himself.

The only remaining question is in relation to the costs, and as, from the view taken by the Court, the accounts must necessarily be remanded to the Commissioner, the decree on that point is opened, and the question of costs reserved until the f r .it. jz t 7 hearing on the final report.

It is ordered and decreed, that the report be recommitted to the Commissioner, for the purpose of hearing testimony and stating the account upon the principles of this decree — on all matters not hereby otherwise ruled the decree of the Circuit Court is affirmed.'

JohnstoN, Ch. and Caldwell, Ch. concurred.

Decree modified.  