'Armour Packing Co. v. Davis, 118 N. C. 548, 24 S. E. 365, and Boykin v. Bank, 118 N. C. 566, 24 S. E. 357, the rule there announced being to the same effect as held in the above-cited case.

And it is held that a bill of lading deliverable to the order of the shipper and attached to a draft drawn upon the purchaser, and sent to a bank "for acceptance and collection," with no other instructions, is rightfully delivered by the bank on acceptance of the draft, and passes title to the goods, and the bank need not hold the draft until payment: St. Paul Roller Mill Co. v. Great Western Dispatch etc. Co., 27 Fed. 434. And where the consignors of cotton took bills of lading in their own name and sent them with draft for the price to a correspondent for collection, and the purchaser of the cotton paid the draft by a check which was honored by the bank under an agreement with the drawer of the check to take the bills of lading as security, it was held that the bills of lading did become functus officio in the hands of the bank, but still represented the cotton on which it had its lien under the agreement with the purchaser: First Nat. Bank v. San Antonio etc. Ry. (Tex. Civ.), 72 S. W. 1033, 97 Tex. Supp. 201,

77 S. W. 410.

The indorsement "for collection" by a bank on invoices accompanying bills of lading attached to drafts is not a guaranty that the bills of lading are genuine. It is simply a notification that the goods: are to be held for the draft if it is not accepted: Goetz v. Bank, 119 U. S. 551, 7 Sup. Ct. Rep. 318, 30 L. ed. 515. In Newcomb v. Boston etc. Corporation, 115 Mass. 230, the railroad receipt recited the same party as consignor and consignee; an order to deliver to the purchaser of the goods or his order was indorsed on the receipt, and it. was sent to a bank for collection. The purchaser went to the bank and accepted the draft, and afterward sold the goods to another. At the request of the purchaser of the goods, a commission man paid the draft at the bank, and obtained the receipt or bill of lading, which was thereupon indorsed to the commission man under an agreement to sell and deduct his commission. The court held the commission man had a special property in the goods, and that the original purchaser had no such title that he could sell, and that the carrier was liable for turning over the goods to anyone other than the commission man.

In Mechanics' etc. Bank v. Farmers' etc. Bank, 60 N. Y. 40, the draft, together with the bill of lading, was sent to a bank for collection. To meet the draft the purchaser of the goods made his note payable to the bank's president, which note was discounted by the bank, the bank at the time receiving an indorsement of the bill of lading as security for its part in the transaction. The court said: "The delivery of the bill of lading to the plaintiff was a good symbolical delivery of the grain, and the plaintiff [the bank] thereby acquired a lien upon it or title to it, and was fully authorized to hold it until the loan was paid.".

If bills of lading, taken to the order of the consignor, with sight time drafts thereto attached, are indorsed to the cashier of a bank, through which they were to be transmitted for collection, there is no presumption of any authority on the part of the bank to surrender the bills of lading upon acceptance of the drafts or otherwise than upon their payment, and if the bank makes such a delivery, it is unauthorized and does not pass the title to the property described in the bills of lading: Bank v. Cummings, 89 Tenn. 609, 24 Am. St. Rep. 618, 18 S. W. 115. But see, also, National Bank v. Merchants' Nat. Bank, 91 U. S. 92, 23 L. ed. 208; Lanfear v. Blossom, 1 La. Ann. 148, 45 Am. Dec. 76, and Schuchardt v. Hall, 36 Md. 590.

e. Effect of Failure of Consideration Between Consignor and Consignee After Acceptance or Payment of the Bill of Exchange Accompanying Bill of Lading.—The subject of this section was exhaustively ~considered in the recent monographic note attached to Hall v. Keller, 91 Am. St. Rep. 212, and we advert to the subject at this time merely to call attention to the fact that the conclusions announced in that note have been approved by the supreme court of Texas in the very recent case of S. Blaisdell, Jr., Co. v. Citizens' Nat. Bank, 96 Tex. 626, 97 Am. St. Rep. 944, 75 S. W. 292. The authorities, as was stated in the note on that subject, are very meager, and the minority rule was based principally upon the authority of Finch v. Gregg, 126 N. C. 176, 35 S. E. 251, 49 L. R. A. 679, and Landa v. Lattin, 19 Tex. Civ. 246, 46 S. W. 48. The doctrine set forth in Landa v. Lattin was distinctly disapproved in the opinion of the Texas supreme court above referred to.

XVI. Right of Assignee to Sue.

Of course, the right of the assignee to sue is dependent upon the mature of the rights which he is seeking to assert. In Dodge v. Meyer, 61 Cal. 405, it was held where a shipper, having right of property in the goods, indorses and delivers the bill of lading, the indorsee may, as a general rule, maintain an action for the goods in his own name. And in Robinson v. Memphis etc. Ry. Co., 9 Fed. 129, it was held the indorsee of a bill of lading for value may not only sue for the goods, but he may, in his own name, sue the carrier for nondelivery. But in Knight v. St. Louis etc. Ry., 141 Ill. 110, 30 N. E. 543, it was held that an assignee of a bill of lading cannot sue in his own name for failure to transport and deliver goods according to the contract, since bills of lading are non-negotiable and his rights under an assignment are not greater than they would have been under a bill of sale. In First Nat. Bank v. Dearborn, 115 Mass. 219, 15 Am. Rep. 92, it was held that one holding a bill of lading as security for advances could maintain replevin against an officer who afterward attaches them upon a writ against the general owner. See, also, Merchants' Ex. Bank v. McGraw, 76 Fed. 930, 22 C. C. A. 622. And in Merchants' Bank v. Union etc. Co., 69 N. Y. 373, a person holding

such a bill of lading as security for advances was held entitled to maintain action against the carrier for failure to deliver the goods pursuant to the bill of lading.

XVII. What Law Governs Construction of the Assignment.

In the principal case it was said that where there is no evidence as to the laws of another state in which a bill of lading was issued, the court will presume that as to bills of lading the common law prevails in that state, and accordingly it held that a bill of lading evidencing a contract between a shipper and a railroad company issued in Virginia has such qualities as are imposed upon it by the laws of that state. In Hunt v. Mississippi etc. Ry. Co., 29 La. Ann. 446, the court held that where it was not advised that the law of Mississippi, where the bill of lading was signed, was different than the law of Louisiana, where the goods were to be delivered, the legal presumption would obtain that the laws of Mississippi were similar to Louisiana.

CASES

IN THE

SUPREME JUDICIAL COURT

OF

MASSACHUSETTS.

CLARK v. KNOWLES.

[187 Mass. 35, 72 N. E. 352.]

FOREIGN CORPORATIONS.—A Bill in Equity to Enforce the Personal Liability of Stockholders in a corporation on a claim not reduced to judgment cannot ordinarily be sustained beyond the state where it was organized. (p. 378.)

FOREIGN CORPORATIONS.-The Personal Liability of a Stockholder in a Colorado Corporation cannot be enforced by a bill in equity in Massachusetts to which the corporation and the other stockholders are not parties. (pp. 379, 380.)

CONFLICT OF LAWS-Laws of Another State, When will not be Followed. The mode of procedure to enforce the liability of stockholders of a foreign corporation depends on the law of the state where the remedy is sought. That state will not give effect to the provisions of a statute of the state where the corporation was organized, if it calls for remedies which, according to the rules of practice of the law of the forum, cannot be given for want of necessary parties. (p. 380.)

Bill in equity by the creditors of a Colorado corporation to enforce a statutory liability. The demurrer to the bill was sustained in the superior court, and the plaintiffs appealed.

H. W. Hervey, for the plaintiffs.

E. D. Stetson, for the defendant.

36 KNOWLTON, C. J. The plaintiffs, four hundred and twenty-five in number, averring that they are the only known creditors of the Colorado State Bank of Grand Junction, a corporation, bring this bill, in behalf of themselves and all other creditors, against the defendant as a stockholder in the bank. It is alleged that the corporation is insolvent, that proceedings to wind up its affairs have been taken, that a receiver

has been appointed under the laws of Colorado, and that certain dividends have been paid. It is said that a large amount of indebtedness is still unpaid, while there is but little property of the corporation that can be used to pay it.

The statute of Colorado, found on page 264 of the Session Laws of 1885, is as follows: "Section 1. Shareholders in banks, savings banks, trust, deposit and security associations, shall be held individually responsible for debts, contracts and engagements of said associations, in double the amount of the par value of the stock owned by them respectively."

It is averred in the bill that the construction, interpretation and meaning of this statute, as determined by the court of last resort in Colorado, are in substance as follows: "Each shareholder of record at the date of the bank's failure is individually and severally liable for the debts and obligations of the bank in an amount equal to twice the par value of the stock so held by him, and this liability is in addition to and independent of any liability on account of his original subscription for the stock. This liability in double the par value of his stock, is in the nature of additional security to the creditors in dealing with the bank and constitutes a fund for the benefit and protection of all creditors. It should properly be recovered in an action brought by one or more of the creditors for the common benefit of all creditors. Neither the bank nor the assignee is interested in this fund, nor can either enforce the liability, nor is either a proper or necessary party to any action brought to enforce such recovery. The aforesaid fund is exclusively for the benefit of the 37 creditors, and forms no part of the assets of the corporation. While in the first instance the assets of the bank or corporation may constitute the primary or regular fund for the payment of corporate liabilities, when by reason of dissolution or insolvency an action against the corporation would be unavailing, or when the remaining assets, if any, consist of worthless or doubtful claims, or claims in litigation, the creditors are not required to wait the collection of such. The shareholders must pay promptly and take upon themselves the onus and risk as to all such claims, looking to the assignee for whatever may be realized on the remaining assets."

This statute, so interpreted, apart from the statement that neither the bank nor the assignee is a necessary or proper party to an action brought for recovery under it, of which we will speak more particularly later, shows that on the establishment of such a corporation, a fund is created in addition to the assets of the corporation, as a guaranty to creditors that the corpo