SUPREME COURT,-JULY 22, 1830.

Before the Chief Justice and Mr. Justice Ryan.

THE BENGAL BANK against THE UNITED COMPANY.

Mr. Dickens opened the pleadings, from which it appeared to be an action brought by the Bank of Bengal, against the United Company of Merchants of England,. trading to the East Indies, to recover the amount of interest due upon three Company's securities, laid as promissory notes, which had been demanded at the Treasury and refused.

The Defendants pleaded the general issue,

Mr. Prinsep stated, that this case now came on for trial for the second time on certain admissions of the Advocate General as to demand of interest and refusal to pay it by the defendants. He could not but regret that his learned friend Mr. Compton who had led him on the former occasion and so fully and so ably stated both the facts and the law, was by absence prevented from finishing a work he had so ably begun, and that it had devolved upon him, a man of so much less experience, to state the present case to their Lordships. In the former case it had been tried before one of their Lordships only, and if in the present instance he should state it at some length, he hoped he might be excused for such reason, for going more fully into particulars than he should otherwise have been warranted in doing.

On the first occasion the plaintiffs had gone upon five notes, but on the present they only sued for the interest of three; Mr. Compton in the course of the former trial having abandoned the other two, finding it impossible to prove that which was required, but in the present pleadings they had been struck out, and the plaintiffs only went for three promissory notes, the first dated 20th August 1825, for Rs. 9400 · payable to Rajkissore Dutt or order; the second, dated 30th January 1826, for 2800 payable to Maharajah Bydinath Roy, and the third, dated 16th November 1827, forRs. 12000 payable to Rajkissore Dutt.

Advocate-General. Promissory Notes!'

Mr. Prinsep said, that his client claimed on three promissory notes and he called them so, because his friend (the Advocate General) he was sure, did not then come forward to say they were not what they appeared tobe; to deny on the part of the Company who employed him, that which the documents themselves purported to be on the very face of them, and what the defendants themselves had called them; as promissory notes they had been declared upon, and in no other way could they; but however, he should be unwilling to discuss the question of law in the first stage of the proceedings; his friend Mr. Compton had very ably stated it, but he would prefer allowing it to remain till either after a Non-suit, which he did not anticipate, or a verdict, it might be more solemnly argued, when he would be able to avail himself of the valuable assistance of the two Gentlemen who had been appointed with him to conduct the case.

Mr. Prinsep said, the defendants were a corporation, and upon these instruments as the promissory notes of a corporation they were sued. There could be no doubt, that corporations could make notes under the statutes of Anne, and he believed it would not be denied, that these notes were negociable in this country; but if further proof were necessary, he would shew the Defendants authority to do so under acts of Parliament, specially referring to the East India Company.

Chief Justice. Some corporations can no doubt make notes, as the Bank of England; but do you carry it so far that because the word corporations is used in the acts, that all have that power?

Mr. Prinsep considered that all corporations for trade had the power if not limited by statutes; but he would rather as he had said, let the question of law be settled afterwards, for it was necessary for him to establish the facts before the question of law was argued which might arise from those facts.

The instruments he said were the instruments of the Company and he would shew his clients the bolders; that they have been properly endorsed; that the demand of interest had been made and refused, and the liability of the Derend. ants to pay that sum. He would contend that they were notes drawn by the Govern. ment of this country, but his friends would perhaps urge that they were not altogether notes in every seuse of the word, and then the case would be brought within nar row bounds. These notes he said had been deposited in the usual way in the Bank, by a partner of the House, and on account of Rajkissore Dut and Co. and he would no doubt shew they had been made by a competent authority and had been acknow ledged as good. There could be no doubt the Government had the power to make such notes, and if he could shew that they had been signed by the Secretary to Go vernment, he would fix the liability upon the Company, but of this there might be some difficulty in the case of a public officer, though where a private individual alone was concerned there would be none; for their Lordships could not but remember that on former occasions the officers of Government could not speak with certainty to their signatures, but this was of little consequence as it would appear that the Bank took the timely precaution of sending them to the Treasury for the purpose of ascertaining whether the signatures were genuine before they took them as deposits for money, and they were there verified as genuine and this amounted in effect to a new acceptance. But as all corporations act by Agents, there must be some Officer to whom this power is delegated and on all occasions the plain. tiffs applied to the Office of the Accountant General for the information they re quired, and would his friend contend that there was no proper Officer? it would indeed be curious if he said, where there are such amazing sums of these kinds of securities in circulation, that there was no person to whom a man could apply to know whether that was a valid security upon which he advanced his money. To the proper Officer said Mr. Prinsep we went and that Officer examined the paper and affixed his signature as authenticating the validity of the security, and upon that certificate the plaintiffs advanced their money and now come to demand the interest, the period for the payment of the principal not having yet arrived.

Mr. Prinsep said, he did not think it would be necessary for him to state further the facts of the case, they would depend principally upon the evidence of Mr. Oxborough, and he would show that on his authority and his certificate the papers were accredited. He cared not what private orders might have been given to this individual within the walls of any department, for the case must be decided by the appearances the defendauts held out, and the plaintiffs only demanded of them to perform that which their act held out, and if they had any intention of limiting the authority of that Officer they should have done so publicly and much mischief would have thereby been avoided; but if they themselves would only take paper upon his authority they held out that he was the only Officer by whom paper could be ac credited and by doing so they made themselves responsible. We shall show, said Mr. Prinsep, that Mr. Oxborough was an officer who understood that he had autho rity to verify Company's paper'; that the public believed him to have had that authority, and that upon that authority he examined the securities the subject of the present action and affixed to them bis initials as certifying their validity. The Go vernment was intimately connected with the Bank of Bengal; some of their prin cipal officers connected with the Treasury were always amongst the Directors, and therefore the defendants must have known that it was the invariable rule in the Bank to send the papers in this way to the Treasury for Mr. Oxborough to au thenticate them; then if they thus tacitly permitted it to go abroad, that this individual had authority to verify them, he thought they must suffer by their own

act.

After some further observations on the question of law, Mr. Prinsep proceeded to call his evidence.

Mr. O'Dowda, Clerk of the Papers, sworn. Produces an extract from the Char ter of the Bank of Bengal-admitted to be correct. This witness also produced three of the same Promissory Notes which were the subject of evidence on the last trial.

Cross-examined by the Advocate General. I cannot say whether or not I have du plicates or triplicates of the papers B, D and F, until I examine. I find I have two

copies B. B. 1 and B. 2; I have three copies of exhibit D. D 1, D2, and D 3, and of exhibit F, I find one copy, F, 1. These papers were produced on the last trial.

Dwarkananth Tagore, sworn. Exhibit B. 1. B, 2. B3 shewn to him. I know Rajah Buddinath Roy; I look at paper B. 2. and 3, Rajkissore Dutt's hand writing appears to them three times. I see paper D, Rajkissore Dutt's hand writing is on it; 1 look at letter F, Rajkissore Dutt's hand writing is on it, and Buduinath Roy's also. I look at the back of paper B 1., Rajkissore Dutt's hand writing is on it twice; his signature is also twice on the paper B 2. His name appears five times on the paper B 3 and his name is five times on D 2. His name is twice on D 3, four times on F 1; Buddinath Roy's name is twice upon this paper F 1, and five times on F 2.

Gooroopersaud Gose, sworn. I am employed by the Bank of Bengal as head Native Accountant. I know the hand writing of Rajkissore Dutt; his hand writing is on the paper now produced to me.

The Chief Justice thought the evidence of Dwarkanath Tagore, relative to the signatures on the respective papers, was sufficient.

Mr. William Oxborough was then sworn, and examined by Mr. Prinsep. I am head unconvenanted Assistant in the Accountant General's office, employed as bookkeeper and superintendent; I have been employed there for fifteen years; the last seven years in the situation I now hold. The office has something to do with Company's paper; all Company's paper is issued from it; they are paid in the General Treasury. The Record of Company's paper is kept in the Record office, under the Accountant General; the amount of the Paper altogether is between thirty and thirty-three crore and is in different forms of instruments. (A paper banded to witness, B.) This is the form o: one loan, 1825 and 1826; the amount of this loan is about ten crore. This paper appears to have been twice in my hands; it came to me first from the Bank of Bengal for examination. From this Bank, papers were sent to me from the 27th October 1828, to the end of September 1829; I was in the habit of receiving 200 or 300 every month; sometimes more. They were brought to me to be examined. My duties were to register all certificates on which Promissory notes were issued, and bills drawn on the Court of Directors of the East India Company. I check and compared these certificates to see that they agree with the registers received from the different offices throughout India; I used to mark against the register the number of the Promissory note, to prevent a duplicate number; I put our number against the register received. We receive certificates from every officer authorised to receive subscriptions; these certificates are brought to me, and I make a general registry of them. After the notes are issued to, and come back from the Secretary, I deliver them to the parties entitled to them. In the first instance I send the note to the next office to mine; it is taken to the different offices for registry and signature by a native, and afterwards returned to me. Notes that are entitled to receive interest, or bills upon the Court of Directors are also brought to me. When notes are consolidated they are brought to me to be registered again and when new notes are issued they go through the same forms as the previous ones, except that the cancelled note goes in place of the certificate (Paper produced). This note marked B. came to me for examination; I was authorised by the Accountant General to examine all notes sent by any body, and to put my ini tials on them.

Advocate General. My Lords, I object to this evidence, because it should be first proved, that the Accountant General had power to give such authority. The objection was overruled.

Examination continued. This authority was given me in the latter end of the year 1824, by Mr. Wood, the then Accountant General. He is now in England. I was so authorized by him generally, by verbal communication, and also by chits. The first verbal communication to the best of my recollection, was to examine the notes that were sent in, and to compare them with our register, to see if they were correct and good notes; this I think was in 1824. The examinations were not then frequent; they were very frequent last year, after the forgeries were detected. There were two forgeries detected, the first in October 1828, the last in 1829. I first examined the papers from the Bank about the 9th October 1828, and continued to do so until the 29th September, 1829-I continued to examine after that,

under the previous authority of Mr. Wood; there was no subsequent variation in that authority until the last forgery was discovered in July, 1829. I was absent on leave for some time, and my brother was permitted to examine in my place; there was no other officer in my department authorized to do so. After the Secretary had signed the notes he had nothing further to do with them. I have had occasion to examine notes in other public departments, particularly that of Salt and Opium. I have done so several times, and at one time I examined a great many. This occurred in May 1828, by a letter from Mr. Wood, I say so because I have found a letter sent to me by the Accountant General on that occasion. I have received a subpoena to produce that letter in court, of which I informed the Accountant General, who desired me to give it up to Mr. Molloy.

By the Chief Justice. I only found the note two days ago, and gave it to the Accountant General, and told him I was desired to bring it into Court? he desired me to give it up to the Company's Attorney.

Mr. Prinsep required the letter to be produced.

The Advocate General refused it, and objected to any thing from the Accountant General being read, until his authority to bind the defendants had been shewn.

Witness continued. The letter was written on the back of one from Mr. Parker, of the Salt and Opium department, to Mr. Wood, the then Accountant General; Mr. Wood wrote on this letter to me as nearly as I can recollect, to the following effect:" The examination of these notes is essential to protect the Company from any loss, do the needful without fee." There were 60 or 70 notes, the whole of them deposits in the Salt and Opium department sent to me with the letter from the Accountant General. I examined and certified these papers, I did not to my knowledge before that time, examine papers in that department, but I have frequently done so since. I examined the papers and put my initials on them in the same manner as other Company'a paper. I used to receive a fee of a rupee for exa. mining each note, (not in the Salt and Opium department). I received this fee by order of Mr. Wood. The Bank of Bengal allowed me 100 Rupees per month for examining their paper from October 1828 to September 1829. This allowance was paid by direction of Mr. Wood, who was President of the Bank of Bengal in 1828. Mr. Secretary McKenzie has since been President of the Bank. I never took a fee for an examination when it was for a public department. I returned the papers to Mr. Parker; that Gentleman mentioned in his letter to the Accountant General that his motive for having the paper examined was to ascertain the correctness of the deposits. I look again at this paper, letter B. I put my initials on it on the 28th March and secondly on the 28th July 1829, I look at Paper D, I first saw this on the 4th November, 1828; it came to me three times from the Bank of Bengal, I examined it a second time on the 2d January 1829, and a third time on the 28th April 1829. I look at paper F, I signed it on the 24th April 1829. It then came from the Bank of Bengal and was returned. It was in the year 1824, I first received a verbal authority to examine those papers. I cannot exactly recollect the tenor of that authority, I always conducted the examination in the same way, compared the body of the note with the register; examined the sig natures and placed my initials, Mr. Holt McKenzie was Secretary in the year 1824; then Mr. Prinsep; then Mr. Molony and then Mr. McNaghten. I know the sig nature of all these gentlemen. I cannot say at what dates Mr. McKenzie was absent. Upon the general examination of the whole, I placed my initials on the paper, I then thought they were genuine.

By the Advocate General. I am not of that opinion now, I believe they are forgeries. I registered all notes; the register and certificate as the next step to be taken, are to be sent into another room for the note to be drawn out; some natives of the department are appointed for that duty. The note is drawn out corresponding to the register and certificate. The next step is that when the body of the note is written, it is brought back to me, together with the certificate and register, and I then mark on it the number of the register. It is then taken to the Examiner (my brother), who sees that the register and note agree. After this, the certifi cate, register, and promissory note are taken to the Accountant General, puty; these gentlemen are covenanted servants, myself and brother are not,-the Covenanted servant then signs the note, which is then sent to be signed to another

or his de

covenanted servant, (the head assistant). It is then sent to the Secretary to Government, who signs it; lastly it is returned to me, and I deliver it to the owner. Mr. Dickens objected to this examination as inadmissible.

Mr. Pearson stated, that his object was to show, that it was unlikely that so much pains should be taken to make an authenticated note, and that the authentication afterwards should be left to one uncovenanted assistant.

The Chief Justice told Mr. Dickens, that if any objection was made, it should come from his leader.

Mr. Dickens sat down, and the examination was resumed.

Witness. I think it to be impossible, that a duplicate of any of the notes should pass through. I look at the paper B 1; this is a good note, it has been cancelled. B 2 is a forgery. It was never examined by me. I look at papers marked D; D 1, 2, 3.— D 1, is good; D is a forgery; the others D 2 and 3 are forgeries,-the two last are very similar to the first. F 1 is a forged note. At the time Mr. Wood gave the orders about the Opium papers, he was president of the Bengal Bank, I don't know when he commenced being so; it was at the time his predecessor went up the country with the Governor General. People coming with notes, stood at a railing in my office, about twelve feet distant. The paper marked No. 1, was hung up in the office, but that was not the authority under which I acted. It was first hung up, three or four years ago. My writing is on the back of it. I think I gave the same evidence on the last trial. I have not now the same confidence in the signatures that I had then. I did not examine papers for Fergusson's House; I did occasionally for Palmer's but I did not examine for Mackintosh's, I look at two papers 2 and 3; No. 2 is signed by Mr. Wood; No. 3 bears the initials of Mr. Holt Mackenzie.

л

Re-examined by Mr. Prinsep. Thé signatures of D 2-D3 and F. 1 are so well executed, that at first I should take them to be genuine; but, guided now in my opinion, by seeing other instruments produced, I pronounce them to be forgeries; when I placed my initials on them I had no doubt whatever of their being genuine. The paper alluded to by the Advocate General, marked 1, was hung up near me on an almirah in the office, but not in a conspicuous place; there were no other papers on it. (This paper purported to be an authority from Government, authorising Mr. Oxborough to examine the registers as to Company's papers, and permitting him to receive one rupee for each examination.) My office was not a place of public resort. Where I sat was not a public part of the office; none but people of respectability were admitted. The paper which hung up in the office could not be read by any one outside the railing. I had the paper copied and hung up for my own information.

Examined by the Chief Justice. The loan of 1825 and 1826, is a part of what is called the register debt; it is classed under that head in our accounts. The whole of the Treasury notes, and Company's loan form a part of that register debt. For the Company's investments in the China Trade, the Super-cargoes at Canton draw bills on the Government, and the Court of Directors, for such amount as they may require to buy their investments, or else they take bullion according to the rates of exchange. The promissory notes have always been signed for the last 36 or 37 years by the Secretary, for the time being in, the Territorial department. The duties paid by the Company on their goods imported into Calcutta, are credited to the Territorial, and debited to the Commercial Revenue, and then transfer is made, but no cash payment; it is credited to the revenue under the head of duties on Company's investments. The balance between Commercial and Territorial Revenue has never yet been struck. We have the whole management of the cash payments to Commercial Agents, &c. for silk investments; on their getting money the Commercial account would be debited with it.

Sir Edward Ryan. The cash advanced to Commercial Agents would be out of these loans. When Commercial advances are made they are raised by loan.

Beerchunder Addie sworn. Examined by Mr. Cleland. I am deputy Treasurer of the Bank of Bengal; I bave been so three years. I have known of loans frequently advanced on Company's papers. Upon a man coming to borrow money he mentions the sum he wants, which with his name is taken to the Secretary; they are then entered in a book, and a memorandum is made. The papers are sent