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UNSEAWORTHY VESSELS-LIABILITY OF SHIP-OWNERS.

In the Court of Queen's Bench, a short time since, the following case came on for hearing:

Couch vs. Steel. The defendant in this case is the owner of the vessel, and the plaintiff, who is an able-bodied seaman, had entered into an agreement to work in the ship during a voyage between Plymouth and Calcutta. The declaration having recited the agreement, alleged that the defendant's vessel was unseaworthy, in consequence of which the plaintiff was unable to sleep in his hammock, had got wet and become sick. A second count alleged that the defendant had neglected to provide his vessel with sufficient medicine for the cure of sickness.

Both counts were demurred to. Mr. Kingdon, in support of the demurrer, said this was the first time such an action had ever been brought, and it was contrary to all principle. A ship-owner was not bound to provide his seamen with a vessel which was seaworthy at the commencement of a voyage. The seamen might receive higher wages in consequence of the defective state of the vessel. The learned counsel cited Seymour us. Maddox, (20 Law Journal, p. 327,) and Priestly and Forster, (1st Mees. and Wells, p. 1,) to show that a master was not bound to have premises upon which he hired servants to work in such a state of repair that the servants could not possibly sustain injury.

Mr. Millward, in support of the declaration, referred to Gibson and Small, which was decided in the House of Lords last session, to show that the shipowner was bound to provide a seaworthy vessel for the seamen he hired as well as for all other purposes.

Lord Campbell gave judgment. After stating the facts alleged in the declaration, he said it seemed to him that there was no contract or duty disclosed by the declaration which could be the foundation of the complaint contained in the first count. For anything that appeared, the defendant might have been ignorant of any defects in the ship, and the plaintiff himself might have examined the ship, and become perfectly aware of her condition before engaging himself as a seaman on the voyage in question. Even if both parties were aware of the unseaworthiness, it might have been the intention that the plaintiff, undergoing greater hardships and labor in such a vessel, should be remunerated by higher wages. If the doctrine contended for was correct, the defendant, though free from any blame, would be liable to an action at the suit of every seaman on board, in case a butt happened to start while the vessel was going out of Plymouth Sound. There was no instance of such an action being brought, there was no decision authorizing the doctrine now contended for, nor had any principle been urged upon which such an action could be maintained. The only authorities cited were certain dicta of the learned judges in the case of Gibson vs. Small, but it was not the intention of those judges to lay down the law that in all these contracts there was an implied warranty that the ship was seaworthy, as in the case of a policy of insurance, or that such an action as the present could be maintained. That case was, therefore, no authority. The authorities were rather the other way; for if the principle involved in Seymour vs. Maddox and Priestly vs. Fowler were applied to the present case, it would show that the action could not be maintained.

Mr. Justice Coleridge and Mr. Justice Wightman expressed themselves to the same effect. Judgment for the defendant.-European Times.

LAW OF PATENTS.

A invented something which he called "A's Patent Kitchener," but he never took out a patent for it. B was his servant, and in that capacity learned to make the apparatus, which he sold by the name of the inventor, as if made by him. A knew these facts four months before he took steps to protect himself. The Court refused an injunction, because he had falsely described the invention as a patent, and had allowed so long a time to elapse; and would only permit him to retain the bill for six months, with liberty to bring an action.

COMMERCIAL CHRONICLE AND REVIEW.

FRAUDULENT ISSUE OF RAILROAD STOCK-PANIC IN THE MARKET-COURSE TO BE PURSUED WITH THE OVER-ISSUES EFFECT OF THIS DEVELOPMENT UPON OTHER CORPORATE COMPANIES-LESSONS TAUGHT BY THESE DISCLOSURES-GENERAL CONSIDERATIONS CONNECTED WITH THE ACTION OF STOCK COMPANIES-PAYMENT ON ACCOUNT OF THE MEXICAN TREATY-CONDITION OF THE NEW. YORK BANKS-CONDITION OF THE BOSTON BANKS-MASSACHUSETTS BANKS-NEW ORLEANS BANKS -BANK OF MISSOURI AND BRANCHES-DEPOSITS AND COINAGE AT PHILADELPHIA AND NEW ORLEANS MINTS-IMPORTS AT NEW YORK FOR JUNE, FROM JANUARY 1ST, AND FOR THE FISCAL YEAR -IMPORTS OF DRY GOODS-CASH REVENUE-EXPORTS FROM NEW YORK TO FOREIGN PORTS FOR JUNE, FOR SIX MONTHS, AND FOR THE LAST FISCAL YEAR--EXPORTS OF LEADING ARTICLES OF DOMESTIC PRODUCE TO A LATE DATE, ETC.

Soon after the issue of our last number, an immense fraud was discovered in the stock accounts of two important railroad companies, which has given a shock to public confidence, from which it will not speedily recover. One of the directors of the New York and New Haven Railroad Company, finding that the stock was depreciating, and that large sales were being made at the Stock Exchange in New York, called at the transfer office to ascertain who were the sellers, and this led to the subsequent developments. Mr. Robert Schuyler, the President and Transfer Agent of the Company, announced the failure of his business firm, (R. & G. L. Schuyler,) on the 1st July, and sent in his resignation of his offices in a note to one of the directors, wherein he intimated, what had already been suspected, that something was wrong with the stock. It was afterwards ascertained that while the legal limit of the Company's stock is 30,000 shares, or $3,000,000, there were afloat certificates of 50,000 shares, or $5,000,000, and consequently an over-issue of $2,000,000. This created the greatest alarm throughout the country, and as Mr. Schuyler had fled, it was naturally inferred that his brother and business partner, who was President of the Harlem Railroad Company, might have involved that company in similar difficulties. Subsequent investigations showed that while the suspected party, G. L. Schuyler, had no knowledge of the fraud, there had been an unauthorized issue of 4,131 shares of Harlem old stock, and 1,389 Preferred stock, by the Secretary, Alexander Kyle, whose breach of trust had no connection with Mr. Robert Schuyler. These shares were for $50 each, and the amount thus fraudulently issued was about $276,000. Mr. Robert Schuyler was also indebted to the company upwards of $100,000, so that its loss by both defaulters will be very considerable. Mr. Schuyler's course was the consequence of the difficulties in which he had involved himself in connection with the building of other railroads, especially in the construction of the Vermont Valley and the Washington and Saratoga railroads, where large sums had been sunk by the original subscribers. Mr. Kyle's was the direct result of extravagance in living and stock speculations. Smail defalcations have been detected in connection with the Naugatuck and the Canal railroads, in Connecticut, through Mr. Schuyler's means as Transfer Agent, but the loss to both will be only trifling.

The discovery of the above frauds created a universal panic that for a while threatened to break up the railroad system throughout the country. Stocks

precipitately declined, and were unsaleable even at a mere nominal price; while those who had borrowed money upon railroad stocks or bonds, subject to the call of the lender, were required to make immediate payment. This twofold operation created much distress in every commercial community. The rapid decline in stocks ruined a great many whose chief investments were in this species of property; and the impossibility of borrowing upon these securities at any price, obliged all who were carrying any considerable amount to fail in their obligations, or obtain an extension from their creditors.

What shall be done with the stock thus fraudulently issued, is a question not yet satisfactorily answered. The Harlem Company, whose limit of stock had not been previously reached, it is generally understood, will make no difficulty in recognizing or providing for the extra issues. The New York and New Ha

ven Company are still undecided, and it is probable that the whole subject will be submitted to the action of the courts. Some assert that as stock is the creature of law, there can be no issue of stock beyond the legal limits, and therefore that the certificates for 20,000 shares, or $2,000,000, are null and void; and therefore the holders have no privileges in common with the bona fide stockholders. But, taking this view of the case, would not the certificate thus fraudulently issued, although not recognized as stock, be good as an evidence of debt against the company? If this were so, then the holders of false certificates would have a better remedy than the merging of their claims into a common stock. But there is a practical question behind all these theoretical disputes: Can the false certificates be distinguished from the genuine? If A has 100 shares of genuine stock and 100 shares of false, each acknowledged by the Transfer Agent to be genuine, and sells both to C, the latter takes out not two certificates of 100 each, but one certificate of 200 shares, thus uniting the false with the genuine. If C now sell to four other parties, each 50 shares, which of them will have the genuine stock? The courts may decide that the first transfer will be binding and represent the genuine, while the remainder represents the false; but such a decision would work a great deal of practical injustice, and though it would draw a line, could not, in the nature of things, draw the line in the right place. If the old stockholders repudiate the over-issues wherever they can be distinguished, the holders of the latter may still have a legal claim against the corporation for the debt thus created by the officers and authorized agents of the company. The whole subject is full of difficulty, and the conflicting claims must be adjudicated by the courts.

Since the above defalcations were discovered, the announcement has been made that Mr. Crane, of the Vermont Central Railroad, had over-issued 8,000 shares of the stock of that company, but as its market value was previously very low, it has not created so much excitement in the community.

In the meantime, the credit of all stock companies is necessarily more or less affected by these disclosures. There is, of course, no more reason now to suspect the officers of any other companies than before, but such is human nature, that the suspicion is very natural under the circumstances. It will soon wear away, if not kept alive by the injudicious conduct of the officers themselves, some of whom, it must be confessed, appear a little too independent of the good opinion of the community. There has ever been too much secresy and selfish maneuvering on the part of the managers of some of our railroad com

panies, and the fortunes of thousands have not unfrequently been trifled with by a stock-jobbing clique which has had the power, by a peculiar system of direction, to raise or depress the stock at pleasure. We noticed this more than two years ago, and then urged more openness and fair dealing on the part of those thus holding the authority. This advice has now been reiterated by the voice of a bitter experience, and there is reason to hope that the instinct of self-preservation will teach those who have thus speculated at the expense of their stockholders, to be more honest in the future.

There is another lesson taught by this experience, which concerns all classes of every profession, but which all are too slow to learn. It is the importance of examining thoroughly the foundation whereon we stand, and to know at once the worst of our situation and fortune. From the sick man, who, with one foot in the grave, still flatters himself with a long life, to the bankrupt who hides the yawning gulf from his eyes the while he is dallying on its brink— few are willing to look the true state of their affairs fully in the face. When a railroad is projected, the cost is always greatly under-estimated; as the work goes on, one series of bonds after another is issued, each one to be the last. When the rails are laid, the cars commence running; but the depots are not built, a suitable running stock is not provided, there are fences, and bridges, and embankments, and turn-outs to be constructed or finished, and the construction account is kept open. Most of the receipts are divided as the net earnings of the road, and still the directors go on and borrow money to complete the necessary improvements. By the time this is done, perhaps something needs renewing, and the managers have no farther excuse for borrowing money to charge to construction account, so the earnings of the road are diverted to this purpose. Then the dividends are passed, and the stock flounders along, or settles down into a second-rate fancy. The whole system of management by a stock company is one requiring great probity and careful adjustment to be sufficiently economical for success. In manufacturing, it too often happens that the officers and employees all get rich through the operations of the company, while the stockholders scarcely get the licking of the platter from which their servants dine so sumptuously. This may not be true to the same extent with railroad companies, but there are instances where it would not be uncharitable to make the same application.

The treaty with Mexico called for the payment to the agent of that government of $7,000,000 in the city of New York immediately upon the exchange of ratifications, and that amount was paid in a single draft upon the New York Sub-Treasury, from whence it was drawn on the 11th of July. Of this amount, $4,000,000 were deposited by the accredited agent of Mexico with three of the New York banks as a special deposit, and the remaining $3,000,000 were loaned to five of the banks at a small rate of interest, to be called for after ten days' notice. This has been used by the banks in discounting mercantile paper at short dates, and has aided in modifying the severe money pressure consequent upon the loss of confidence already described. Even before the receipt of this money, the New York banks made a good showing of specie, and now the av erage is very large. The following are the comparative returns up to a late

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The following is a continuation of the weekly statements of the Boston

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The following is a summary of the last statement of the banks of Massachusetts, compared with the returns on the first day of October, 1853 :

LIABILITIES.

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Net circulation..

5,323,699

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• On and after this date, the Bank Balances were included in the Deposits, by request of the Superintendent.

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