§ 598.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. IX. of the new certificate made a further loan. "When the forgery was discovered the bank brought suit against the corporation, and was allowed to recover the amount of the second loan, but not the amount of the first. 1 § 598. Accordingly, a certificate of stock in a corporation, under the corporate seal, and signed by the officers authorized to issue certificates, estops the corpora- tion to deny its validity as against one who has taken it for value without knowledge or notice of any fact tending to show that it has been irregularly issued. 2 Estoppel of corpora- tion by its certificate. 1 Metropolitan Savings Bank v. Baltimore, 63 Md. 6. 2 Moores v. Citizens' National Bank, 111 U. S. 156, 165. In this case the plaintiff lent money to the cashier of a bank for his own use, and took from him as security a certificate of stock written by him on one of the printed forms which the president had signed and left with the cashier to be used if needed in the president's absence. The cer- tificate certified that the plaintiff was the owner of the stock "trans- ferable only on the books of the bank on the surrender of this cer- tificate," and the by-laws did in fact provide that certificates should be issued only on surrender of the former certificate. The cashier falsely represented to the plaintiff that he owned the stock in question and had transferred it to the plain- tiff. The cashier did not surrender any certificate to the bank, or make any transfer on its books to the plaintiff; he never repaid the money loaned and was insolvent. The bank never rati lied or received any benefit from the transaction. Held, on the refusal of the bank to recog- nize the certificate as valid, the plaintiff could not recover from the bank its value, and could not sus- tain her case by evidence that in one or two other instances the cashier 602 had issued certificates without any certificate being surrendered. The court further held that the representations of the cashier, be- yond those in the certificate, were made by him personally, and not on behalf of the bank. " The duty of transferring his stock to the plaintiff before taking out a new certificate in her name was a duty that he and not the bank owed to the plaintiff. The making of such a transfer was an act to be done by him in his own behalf as between him and the plain- tiff, and in the plaintiff's behalf as between her and the bank. The very form of the certificate was such as to put her on her guard." Plain- tiff "was not applying to the bank to take stock as an original sub- scriber or otherwise; but she was bargaining with the cashier for his stock, which she supposed him to hold as his own; she knew that she had not held or surrendered any cer- tificate, and she never asked to see his certificate or a transfer thereof to her; and he in fact made no sur- render to the bank or transfer on its books; she relied on his personal representation as the party with whom she was dealing that he had such stock; and she trusted him as her agent to see the proper transfer thereof made on the books of the bank. Having distinct notice that
