On March 13, 1930, a run was made on the Bank of Union, as a result of which it was determined by its board of directors that it would be unable to open the following day. That night the board of directors adopted a resolution that the bank be closed for liquidation, with directions that the superintendent of banks be requested to take charge of its affairs. At the same time and immediately following the adoption of the said resolution and as a part of the same meeting, which was kept in session nearly all night, an arrangement was made by the directors of the Bank of Union with the Peoples Bank of Union, by which sufficient of the assets of the Bank of Union was delivered and assigned to the Peoples Bank to enable the latter bank to pay off all depositors and other creditors of the Bank of Union. This agreement was reduced to writing, and such steps were taken thereunder that all the depositors and other creditors of the Bank of Union were fully paid by the Peoples Bank.
On the 21st day of March, 1930, the superintendent of banks by his petition submitted jurisdiction of the liquidation to the chancery court, and on the next day the formal order was made by the chancellor taking over *Page 386 full and complete jurisdiction. Shortly thereafter the appellant, H.G. Graham, was appointed liquidating agent, and he acted as such until succeeded by the appellee, Roebuck, upon the reorganization of the state banking department. On or about December 3, 1934, Love, as former superintendent, filed his final account in said liquidation, final so far as he was concerned, but not the final account in said liquidation, to which, on April 12, 1935, appellee Roebuck, joined by Mary L. Cole, hereinafter to be noticed, filed exceptions. The exceptions embraced many items, but, by agreement of the parties, at the hearing the exceptions were reduced to six. After full evidence taken, the chancellor overruled three of the six items and sustained three.
As to two of these items adjudicated against appellants by the chancellor, we are of the opinion that he was correct, to-wit, as to the item charging the liquidator for timber, and the item under which the appellant Graham was disallowed compensation for his services beyond amounts actually paid out by him. But we are of the opinion that the decree against appellants for the five thousand and forty-six dollars and seventy-five cents, paid to the Peoples Bank cannot be sustained in its entirety.
The facts about that item may be briefly stated as follows: Some time after the date of the aforementioned arrangement between the said banks, the Peoples Bank complained, and continued to complain, to the liquidator of the Bank of Union that among the assets turned over by the directors of the Bank of Union to the Peoples Bank there were several worthless items amounting to more than five thousand dollars, and that the worthlessness thereof was not only known to the directors of the Bank of Union at the time of the transfer, but to conceal their want of value the said directors at the time knowingly misrepresented the material and basic facts touching said items; and towards the end of the year, *Page 387 that is to say of the year 1930, the Peoples Bank was urging some action in rectification of its claim of fraud upon it. The liquidating agent, Graham, submitted the matter to the superintendent, who advised that no settlement be made without the consent of the stockholders of the Bank of Union. The liquidating agent thereupon presented the question to the stockholders of the Bank of Union and obtained the written consent of five of the stockholders, representing, so he testifies, from eighty to eighty-five per cent. of all the outstanding stock, to make the settlement, the written agreement being as follows:
"We, the undersigned stockholders of the Union Bank, a banking corporation domiciled at Union in Newton County, Mississippi, hereby expressly give our consent to the proposed settlement between the Peoples Bank of Union and H.G. Graham, Liquidating Agent of the Bank of Union, whereby in consideration of the sum of $5,000.00 paid by H.G. Graham, Liquidating Agent, and delivery by him of the notes of H.G. Hester, for the sum of $2500.00, the said Peoples Bank of Union is to release the Bank of Union and/or the Liquidating Agent thereof, and/or the stockholders in said Bank of Union and/or the Bank of Union, from any and all claims, demands, actions or rights of action which the said Peoples Bank may now have, or hereafter have, against the Bank of Union, the Liquidating Agent thereof, the stockholders therein or the said Bank of Union.
"In testimony whereof, witness the signatures of the stockholders of the said Bank of Union hereunto affixed, on this ____ day of January, 1931.
"G.W. Todd "Mrs. Mary Cole "W.R. Rivers "W.N. McLemore "I.M. Gallaspy."
Upon the execution of that agreement, the liquidating agent paid over to the Peoples Bank the amount mentioned *Page 388 in said stockholders' written consent, but without securing the consent of all the stockholders and without any order of the court.
Inasmuch as the settlement and payment was made by the liquidating agent without any order of the court so authorizing, the liquidating agent, the appellant Graham, primarily, and appellant Love, superintendent, secondarily, would be liable for the amount of money thus taken from the liquidating funds and paid over as aforesaid, had none of the stockholders consented. But even without an order of court appellants are not liable for that portion of said amount which would, upon the distribution of it, belong to the above-mentioned assenting stockholders.
We must look below the surface, and to the substance of the situation. As already mentioned, all the debts of the Bank of Union have long ago been paid, all its obligations have been discharged. Anything now recovered by the present receiver belongs, in equity, to the stockholders of the Bank of Union. They are the only remaining parties in beneficial interest. It is solely in their interest that the receiver now acts. Should decree be permitted to prevail against appellees for the said five thousand dollars with interest, the money when recovered thereunder would stand ready for distribution among the stockholders, so that the five stockholders who consented to the payment by appellees would recover their portion of the money which was paid by and after their consent that it should be paid. There is no such thing in equity as that a party or parties may expressly consent in due form to the doing of a particular act and thereafter turn upon the actor and recover money from him as a consequence of that same act; and since such parties may not themselves do so, they cannot accomplish the same result by acting through the offices of another for them. *Page 389
It is urged, however, against the conclusion which we have reached and the directions which we shall give, that the five stockholders are not formal parties to the hearing on the exceptions by the receiver, and that unless summoned in for such a hearing, no adjudication affecting their interest may be made. This point is not well taken in any event as to Mrs. Cole and as to any share of the stock owned by her individually, because she joined in the exceptions. And as to the other four of the consenting stockholders, we quote from Dunn v. Love, 172 Miss. 342, 353, 155 So. 331, 332, 92 A.L.R. 1323: "It seems to be contended that a summons to all parties would have to be issued and served as if in the institution of a new suit. But the entire matter and all the parties in interest were already in court and had been for more than two years, or since the original institution of the liquidation proceedings, the notice then given as required by statute being all that was necessary to the presence of the parties and their continued presence until the liquidation proceedings were concluded. The liquidation proceeding was a quasi receivership. . . . In receivership and in liquidations, such as this, the court acts in all ordinary administration matters upon ex parte petition or motion and without formal notice to the parties in interest." The filing of accounts, including the said account of the former superintendent, was an ordinary matter in due course, and the statute requires no new notice in respect to that particular account.
The decree of the chancellor is affirmed in all respects except as to the item of five thousand dollars with interest, above discussed. As to this item, the decree is reversed, and the cause remanded, with directions that decree shall be rendered against appellants only for that portion of the said sum with interest which will represent the part thereof which would belong to the nonassenting stockholders as compared to the total amount of *Page 390 the stock in the Bank of Union. We pretermit any discussion of the stock owned by J.M. Cole, deceased, the husband of Mrs. Mary Cole, and the question whether the assent of Mrs. Cole to the settlement had any force as against the estate of her husband is referred to the chancellor for his determination upon the facts when developed before him.
Affirmed in part; reversed in part, and remanded, with directions.