Butterfield v. Spencer.

in my absence, or that it could not be in my absence. I did not tell him I had made no disposition of the stock, or that it still stood in his name. I am as certain of this as I am of my own existence. Nothing whatever was said on any of these subjects." On the cross-examination the witness testified:

"I made no other communication to Mr. John Butterfield in regard to Ely's declining the stock than what I have stated. I have a very distinct recollection of that conversation of the 21st of April; my attention was called to it the next week, on my return to New York. I state that these things were not said, both from distinct recollection that they were not said, and because I know they could not have been said without my recollecting, nor without my telling Ely a falsehood. I have three reasons for saying that no such conversation took place:

"First. It would have been a lie, and I know I did not tell him a lie; second, it would have been inconsistent with what I then inferred he had done in my absence; third, I distinctly recollect that no such things were said."

George Ely wrote a letter to Spencer, which was read in evidence, and bore date the 25th of April, 1853, and which stated in substance that the plaintiff, on the previous Saturday, through an agent at Rochester, made Ely an offer for his stock in the United States Express Co., which he had accepted, and that he had assigned to the plaintiff his receipt and interest in his subscription, adding, "he will therefore pay the instalment called for to-day." It assigned as Ely's reason for selling, that he believed it judicious to accept the offer made to him. Spencer received this letter on the 27th of April, 1853, at New York, and it was post-marked at Rochester on the 26th of April.

There was also produced, proved, and read in evidence, the guaranty mentioned in the letter or notice of the 16th of March, 1853, sent by Spencer to Ely, which guaranty bears the date last named, and was delivered cotemporaneously with the said agreement of the date of March 7, 1853. Said guaranty read as follows:

"We, whose names are hereto subscribed, do hereby, for a valuable consideration, guaranty and agree to and with Hamilton Spencer, President of the United States Express Company, and

Butterfield v. Spencer.

with each stockholder of the United States Express Company, electing to avail himself as hereinafter provided in this agreement, that so much of two hundred thousand dollars of stock in the American Express Company this day agreed to be sold to the stockholders of the United States Express Company, as the holders of such stock may elect to dispose of, pursuant to this agreement, shall produce to the holders thereof, respectively, within one year from the first day of May, 1853, the sum of one hundred and twenty-five dollars per share.

"The stockholders of the United States Express Company, to whom such stock is to be issued shall, on or before the 16th day of April next, give written notice that they intend to avail themselves of this guaranty; such notice to be delivered to Hamilton Spencer, at the office of the United States Express Company, 170 Broadway, New York, who shall, within twenty-four hours thereafter, give a like notice to the undersigned, at their office, No. 10 Wall street, New York, that they desire to sell their proportion of such stock, and, thereupon, the subscribers shall be bound to take such stock any time within said year, at the option of the undersigned, and pay for the same at the price aforesaid.

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"But no stockholders, giving such notice, shall be at liberty thereafter to sell such stock, except with the consent of the subscribers or their authorized agent, and, upon the completion of the sale, the subscribers shall be credited towards the said price of one hundred and twenty-five dollars per share, with all cash or stock dividends and earnings received by such stockholders, and shall be bound to pay only such sum as, together with such cash or stock dividends and earnings, shall be equal to said price of one hundred and twenty-five ($125) dollars per share.

"The subscribers shall have the right to take such stock at the price aforesaid, at any time within said year that they shall choose.

"Every stockholder of the United States Express Company giving notice as aforesaid, shall thereby become a party to this contract, severally, and may enforce the same in his own name and for his own benefit, so far as relates to stock actually held by him.

"At the time such stockholder gives notice as aforesaid, each person so giving notice shall deposit with said Spencer, his stock, duly endorsed, so as to authorize its transfer to the subscribers

Butterfield v. Spencer.

when they pay for the same, and said Spencer shall deliver the same upon receiving payment therefor as aforesaid.

"Dated March 16, 1853.

JOHN BUTTERFIELD.

JAMES D. WASSON.

WM. G. FARGO.

E. P. WILLIAMS.

JOHNSTON LIVINGSTON."

Other testimony was given, which it is unnecessary to state. The facts, found by the court, at special term, and its conclusions of law thereon, are as follows:

DECISION OF THE COURT.-The United States Express Company and the American Express Company, were consolidated at the time, in the manner, and by the agreement and acts stated in the complaint. By the agreement of the 7th of March, 1853, the time for the stockholders of the United States Express Company to notify Spencer, that they declined to become purchasers of the stock of the American Express Company, was, thirty days after the delivery of such agreement, which took place on the 16th of March, 1853.

George Ely, of Rochester, who was an original subscriber for fifty shares of the capital stock of the United States Express Company, by a letter directed to Spencer, dated April 9, 1853, and received by the latter on the 15th of said April, notified Spencer that he declined to become a purchaser of stock in the American Express Company, and that he elected to receive $1,000 being the first instalment paid on the fifty shares held by him, with 10 per cent. in addition, and in such letter inclosed and sent to Spencer the receipt of the 4th of February, 1853, which had been given to Ely when he paid the first instalment, the form of which is, as stated in the complaint. Spencer within twenty-four hours after receiving such notice and receipt, in order and with intent to notify the parties of the first part to the agreement of the 7th of March, 1853, that Ely had so declined, was about leaving his office to go to the office of said parties at No. 10 Wall street, to serve them there, with a notice, in writing, that Ely had so declined, when John Butterfield one of said parties entered the office of said

Butterfield v. Spencer.

Spencer, who then informed said Butterfield that said Ely had so declined, and exhibited to him the said letter from said Ely. It was then agreed by said Butterfield and Spencer, that James V. P. Gardner of Utica, N. Y. might become a purchaser of said stock, if he desired to do so, all which occurred within said twentyfour hours. It was also then and there agreed that Spencer should send a telegraphic dispatch to said Gardner to the effect that he could become a purchaser of fifty shares of said stock. Such a telegraphic dispatch was then and there written and handed to said Butterfield to be forwarded by him, as he was a Director in the telegraphic company and could transmit the dispatch without charge to said Gardner and the same was by Butterfield forwarded to said Gardner. Gardner received the same on said 16th of April: He replied by telegraph to Spencer, the same day, accepting the offer, and the same day mailed to Spencer a bank-draft for $1,100, to pay the first instalment and ten per cent. thereon, which was received by Spencer on the 18th of April, who obtained thereon the amount thereof.

Ely, by notifying Spencer that he declined to become a purchaser of stock in the American Express Company, and by sending back with such notice his receipt for the instalment paid by him, and by the acts of Spencer in giving notice thereof, as aforesaid, within twenty-four hours thereafter, to said John Butterfield, and selling the stock to Gardner, pursuant to the said agreement between Spencer and Butterfield, divested himself and was deprived of all right and power to reassert any rights as owner of said stock, or to make any valid sale or disposition thereof. To this the plaintiff's counsel excepted.

Spencer's letter to Ely, of the 16th of April, 1853, inclosing in it the receipt, for the purpose of having Ely sign the power of attorney drawn on the back of it, gave Ely no right or power to renounce the election declared in his letter of the 9th of April. To this the plaintiff's counsel excepted. The conversation between Ely and Spencer, at Rochester, on the 21st of April, after Gardner had bought the stock, and paid one thousand one hundred dollars on account of it, could not operate to annul the rights which Gardner had acquired by his purchase, or to restore to Ely any rights to or power of disposition over the stock. To this the plaintiff's counsel excepted.

Butterfield v. Spencer.

The plaintiff bought with such notice of the previous acts of Ely as made it his duty to inquire in relation to them, and his position is no stronger than it would have been had he inquired and ascertained the actual facts. To this the plaintiff's counsel excepted.

Gardner's equities are superior to those of Ely, and the plaintiff has no rights in the premises, other than those Ely could have asserted and enforced, if he had not made any transfer to the plaintiff, and was himself seeking the relief which the plaintiff seeks to obtain in this action. To this the plaintiff's counsel excepted.

The plaintiff is not entitled to any of the relief prayed for in his complaint, and the bill must be dismissed with costs. To this the plaintiff's counsel excepted.

Judgment having been entered upon the decision, the plaintiff appealed from it to the General Term.

J. E. Burrill, for Appellant,

L. E. Birdseye, for Respondents.

BY THE COURT. WOODRUFF, J.-It is not denied on the part of the appellant that the defendants, the United States Express Company, had, under the articles of their association, authority to enter into the act of consolidation with the American Express Company which has given rise to the present controversy, and no question is made of the entire validity of the agreement entered into for that purpose; nor is it doubted that the respective associations, "The United States Express Company," and "The American Express Company," in their respective aggregate or associate capacity, were in all respects bound by the provisions of that agreement.

It appears by the complaint herein, and by the seventh paragraph of the agreement for consolidation set forth in the "case," that it was expressly agreed, on the part of "The United States Express Company," that they would take 2,000 shares of stock in the American Express Company, and pay therefor to the latter the sum of two hundred thousand dollars, to be divided as therein specified. To the performance of this stipulation the United