In their application for rehearing appellants complain that one aspect of their bill has not received the attention of the court. They segregate the second subdivision of the second paragraph of the original bill, lines 9 to 13 of the seventh section, and all of the thirteenth section of the bill as last amended, as setting forth the facts on which they claim relief according to the formula of Wynn v. Tallapoosa County Bank,168 Ala. 469, 489, 53 So. 228, 236, a case in which the bank sought to charge the estate of its deceased cashier, and where it was said:
"The bill contains equity in so far as it seeks to charge respondent for an accounting as to the funds or property of the bank, acquired by the intestate as the bank's agent or trustee, whether by breach of contract, expressed or implied, or whether by breach of duty or trust growing out of such contractual relation, though it amounted to a tort."
Montgomery Light Co. v. Lahey, 121 Ala. 131, 25 So. 1006, is cited to the same effect. This language of the opinion in the first-named case must be held to have referred to the averment of the bill, to quote from the opinion —
"That at his death he [the cashier] was short in his cash account with the bank in the sum of more than $1,500, and was short in his account with bills receivable in the sum of more than $3,700."
But the court in that case held there was no evidence to sustain this charge. Montgomery Light Co. v. Lahey sheds no light upon the question here presented. Ward v. Hood, 124 Ala. 570,27 So. 245, 82 Am. St. Rep. 205, is also cited to the proposition that —
"Where one wrongfully converts the property of another, the tort may be waived, and an action *Page 98 be brought for the proceeds arising from such conversion as for money had and received for the use and benefit of the plaintiff."
But that proposition will not be denied by any one; the question now presented being whether appellants (complainants) have proceeded on or intended to invoke that rule of law.
The bill is still in substance what it was on former appeal as appears from the second subdivision of the second paragraph of the original bill, where it was and is shown that defendants, as directors of the old bank, caused to be paid out large dividends which "were paid from the assets of said corporation, not surplus profits arising from the business of the bank; or there was paid to the stockholders or some of them by way of dividends a part of the capital stock of the bank." And the original brief now on file in this cause shows only an argument against the conclusions stated by this court on the former appeal, though it does, in division D of proposition 4, cite Wynn v. Tallapoosa County Bank, supra, in support of its contention, there only stated, that the thirteenth section of the amended bill, which does no more than set out in detail the dividends received by defendant directors, "taken in conjunction with the rest of the bill, contains equity, in that it seeks to recover from the respondents, jointly, the funds or property of the bank, acquired by them while acting jointly as the bank's agents, whether by breach of contract, express or implied, or whether by breach of duty or trust growing out of such contractual relation." The purpose of "the rest of the bill," as we said in effect in our original opinion on this appeal, was to fasten upon defendants a liability ex delicto, and such, in our judgment, is the purpose of the bill as a whole in its present frame, even though stress be laid upon those parts of it to which appellants now point in their latest effort to get away from the decision on former appeal.
Moreover, looking to those segregated parts of the bill now pressed upon our attention, no ground appears for charging appellees individually with the dividends received by them. No fraud is charged, as the demurrer points out. The averment found in the midst of the seventh section of the bill as last amended is "that because of losses caused by bad or improper loans and because of illegal dividends which the said directors declared greatly to their own benefit and in fraud of the creditors of the bank, the capital stock of said bank was during all of the time aforesaid greatly impaired, and while so impaired every one of the directors of said Jefferson County Savings Bank who is sued herein breached his contract and agreement to diligently supervise, watch over, and protect the interest of said savings bank in the manner more particularly set out in section sixth hereof as amended," where it is averred, among other things, that appellee defendants "did, in violation of law, declare and pay or cause to be paid dividends upon the capital stock of said bank, while its capital stock was impaired." But these averments as to fraud in the declaration of dividends are nothing more than the conclusions of the pleader, notwithstanding which defendants are not personally liable to creditors, for they are not liable if they acted in good faith in a mistaken belief that a fund existed from which a dividend might have been declared. Lexington Ohio R. R. Co. v. Bridges, 7 B. Mon. (Ky.) 556, 46 Am. Dec. 528. Where directors declare a dividend because of bad judgment, and not bad faith, there is no personal liability to creditors. 1 Morse on Banks (5th Ed.) § 128, p. 270; Magee on Banks (3d Ed.) p. 130. The bill fails to show fraud, and such being the case in respect of creditors, we apprehend that complaining stockholders are in no better case. Indeed, it is not averred by way of conclusion or otherwise that the dividends in question were declared in fraud of the rights of complaining stockholders, who, it may be noted, for aught appearing, accepted and still retain their share of the dividends of which they now complain. True, it is said in the way of recital that the dividends were illegal; but this, in the present state of the bill, can be accepted only as meaning that the dividends "in many instances" were paid from "assets" rather than "surplus profits" — nothing more.
The application is overruled.
ANDERSON, C. J., and GARDNER and MILLER, JJ., concur.