Fourth & First Nat. Bank v. Huntsville Bank & Trust Co.

This case is quite similar to its companion, First National Bank of Chattanooga v. Huntsville Bank Trust Co.,104 So. 760;1 the only difference being that the notes and certificates in the consummation of this loan were sent directly by Hutton to the Nashville Bank, instead of through the Huntsville Bank, as in the other case. It also seems that Hutton was the vice president when this transaction occurred, instead of cashier, as in the other case; but the evidence shows that he was still the general manager of the Huntsville Bank — in a sense, its alter ego. True, Hutton was acting in his individual capacity when borrowing from the Nashville Bank and in transferring the certificates, and in ordinary cases of principal and agent notice to the agent would not be imputable to the principal, when the transaction was an individual one and not for or in behalf of the principal. But this is not the ordinary case of principal and agent and is one where the general manager, the alter ego of the corporation, though acting in an individual capacity, is the only officer of the Huntsville Bank who knows of the transaction and notice that he possesses as man must be imputed to him as officer of the bank. As officer and man, the positions, under the circumstances, cannot be disassociated. Should he have reported the fact, he would have done so to the general manager himself. Or, should the Nashville Bank have made inquiry as to whether or not the Huntsville Bank held a lien, it would naturally have been made to Hutton, and if Hutton could have waived the lien affirmatively, he could do so by silence in the nature of an estoppel. As was said in the case of Lea v. Iron Belt Co.,147 Ala. 430, 42 So. 418, 8 L.R.A. (N.S.) 279, 119 Am. St. Rep. 93, after drawing a distinction between an ordinary agent and a general manager:

"He was, as we have said, to all intents and purposes the corporation itself. It could be nothing but the sheerest nonsense to say that as agent he should communicate the knowledge to himself as the managing representative of his corporation. Since the corporation could acquire notice in no other way than by and through its managing head or officer, it will scarcely be doubted that notice to such officer is of necessity notice to it."

Therefore, notice to Hutton when transferring the stock was imputable to the bank of which he was general manager, notwithstanding he was personally interested in the transaction, and the bank, being chargeable with such notice, waived its lien upon the stock by permitting the Nashville Bank to acquire the same for value without objection or protest.

In the case of Mobile Towing Co. v. First National Bank,201 Ala. 419, 78 So. 797, no point was made or suggested that H. T. Hartwell, who assigned the stock, was the general manager of the corporation and was in a position to waive its lien, but reliance was had only upon an inquiry and reply which was made after the bank had acquired the stock.

The trial court erred in granting the appellee relief, and the decree is reversed, and one is here rendered dismissing the bill of complaint.

Reversed and rendered.

SOMERVILLE, THOMAS, and BOULDIN, JJ., concur.

1 Ante, p. 236.

On Rehearing.