Before:-DUVAL, Chief-Justice, AYLWIN, MEREDITH, MONDELET and BADGLEY, Justices. Held-lo. That a bank manager cannot lawfully lend the money of the bank to a company in which, as a stockholder, he is largely interested; that the bank is not called upon to look to such company, or any individual stockholder, for the money so advanced; and that the bank manager so acting is bound to refund the money to the bank, with interest from the date of service of process, unless there has been acquiescence on the part of the bank in the conduct of the manager. 20. That a bank manager advancing the bank funds to a company in which he holds a small amount of stock, is not liable to the bank for the money so lent, if all the circumstances shew that his interest was so small that it may reasonably be presumed that his intent was solely to promote the interests of the bank. Appellants. Respondent. Jugé-lo. Que le gérant d'une banque ne peut légalement prêter les fonds de la banque à une compagnie dans laquelle il a un'intérêt majeur comme actionnaire; que la banque n'est pas appelée à s'adresser à telle compagnie, ou à aucun de ses actionnaires, pour les argents ainsi avancés ; et que le gérant de la banque, agissant ainsi, est tenu de refondre les deniers à la banque, avec intérêt du jour de la sommation judiciaire, à moins qu'il n'y ait eu acquiescement de la part de la banque quant aux actes du gérant. 20. Que le gérant d'une banque avancant les fonds de telle banque à une compagnie, dans laquelle il n'a qu'un petit nombre d'actions, n'est pas responsable à la banque pour les argents ainsi prétés, si dans les circonstances il appert que son intérêt était si minime que l'on pouvait raisonnablement présumer que son intention était seulement de promouvoir les intérêts de la banque. 30. That a bank manager cannot, with- 30. Que le gérant d'une banque ne sauout being guilty of a grave dereliction of rait, sans se rendre coupable d'un grave duty, become associated with a customer abandon de ses devoirs, s'associer avec of the bank in an enterprise to be carried | une des pratiques de la banque, dans une on with the aid of the bank capital entrusted to his own care; and that the defendant, in the present case, in advancing the funds of the bank towards carrying on an enterprise in which he was himself interested, violated the well established rule of law:-"No one having "duties of a fiduciary character to dis"charge, shall be allowed to enter into "engagements in which he has or can "have a personal interest conflicting, or "which possibly may conflict, with the "interests of those whom he is bound to "protect." 40. That the liability of the defendant to make good the amount so improperly advanced to his associate had been extinguished by payment to the bank. entreprise qui devait être conduite à l'aide des fonds de la banque confiés à ses soins; et que le défendeur, dans l'espèce, en faisant avance des fonds de la banque pour mettre à exécution une entreprise dans laquelle il était lui-même intéressé, violait la règle de droit bien établie :-"Il ne "sera permis à aucune personne ayant "des devoirs d'un caractère fiduciaire à "remplir, d'entrer dans des engagements "dans lesquels il a un intérêt personnel "opposé, ou qui pourrait être opposé, "aux intérêts de ceux qu'il est tenu de "protéger." 40. Que la responsabilité du défendeur, pour le montant ainsi mal-à-propos avancé à son associé, avait été éteinte par paiement à la banque. Judgment rendered the 20th day of September, 1865. BADGLEY, Justice :-This suit instituted by the plaintiffs against the defendant, now deceased, their former servant and Cashier of their Branch Bank at Quebec, is for damages, dommages et intérêts of our laws, suffered by reason of his alleged malfeasance and mis-application of their funds to his own benefit, whilst in such office, and which moneys it is declared, were due and owing by him at the institution of this action. This contention will be governed by our own provin cial jurisprudence and the established practice of our Courts, which need not the introduction of Equity rulings in the Courts of England or of the United States as our special guides in this matter. In the summary of facts which must necessarily introduce the decision in this cause, it is sufficient briefly to state that the Bank of Upper Canada established, in 1852, a banking house and office at Quebec, with little or no capital in hand, and availed itself of the services of the deceased defendant, considered a very competent accountant, to undertake its management as Cashier. It was manifestly intended that this branch should be self-supporting and not only make, but sustain itself, and the Cash-ier was instructed to use his best efforts to obtain business, in other words, to make the most out of a very questionable undertaking at the time; that he accomplished the wishes and objects of his employers, and to their frequently declared satisfaction, appears from their correspondence with him, and from the documents filed of record, whilst after some years of laborious and unsparing service, he was enabled by his personal exertions alone, to place the branch at Quebec upon a firm basis, and from the profita ble result of whose operations the mother institution gladly profited. Without objection made to him during all this period from 1852 to 1858, the deceased defendant was the Cashier and sole manager of the Branch at Quebec, and his communications with respect to its business transactions were direct to the parent Bank at Toronto, varied by several examinations of his proceedings by auditors or examiners from Toronto, whose reports were favourable, until it was thought expedient to dismiss him from his charge. All these circumstances must be considered in the investigation of this case, not for the purpose of relieving a defaulting officer from his legal responsibilities of omission or commission, but because they are material in the investigation of the case, and have been introduced of record as evidence, and been commented upon by both parties in the argument before the Court. It is not to be denied that as a confidential servant of the institution, the deceased defendant was bound to the greatest fidelity and care towards his employers, in his conducting of the business of the bank and in protecting its interests; his duty and his instructions required him to secure and attract business as extensively as comported with profitable bank dealings, and for that purpose to give bank facilities to creditable parties, but his position could not justify, without the express sanction of his employers, his personal application of the bank funds to his own purposes, either directly for his individual necessities or through the intermediation of others with whom he might have business connections. His mandate required of him a strict and paramount regard for and observance of his employers' interests, and any object or matter that could conflict his private interests against those of the institution, must necessarily be disfavourable to him, and would of course render him responsible for the payment of any loss which the bank might suffer thereby. Now this case does not, in or of itself, belong to the known category of commercial cases introductive by statute of the application of english rules of evidence for the recovery of moneys due or accrued due, for merely commercial dealings between parties, but is one arising out of the dommages intérêts of our law, incurred by reason of the defendant's delict and quasi delict, abus de confiance, the misapplication of the bank funds intrusted to his mandate and deposit, and which, it is alleged, he has converted to his own profit and advantage to the amount of damages, dommages et intérêts, suffered and claimed by the plaintiffs as per declaration filed; and it is this conversion which gives the right of action and the demand for the recovery back from him of the mis-applied funds to his own use. Now this cause, as submitted by the plaintiffs, has been expressly limited to the four particulars of demand following, 1° the advances made to the Quebec Mining Company, 2° the transactions with John Wilson, 3° the advance to the Telegraph Company, and 4° and last the transactions with Mackay. My colleague, Mr. justice Meredith, has so elaborately examined these various matters that it would be an unjustifiable repetition in me to go over them again, the evidence therefore upon these several particulars will be but briefly adverted to. As to the first particular, I consider that upon the principles of law which I have stated above, the ad |