Millee, J.:
. The action is for money had and received, the claim .being that the defendant accepted and-retained $5,000 of the plaintiff’s money in payment of a subscription for' twenty-five -shares of its stock after the entire authorized capital stock had been allotted. The certificate' of incorporation of the defendant was filed in the office óf the Superintendent of Banks on the' 25th day of March, 1907. On the. 26th day of September, 1907, the first meeting of its - board of directors was held at which one Howard Maxwell was elected president. He had theretofore acted as ■ chairman of the incorporators. On the twenty-seventh day of September, Maxwell, as president,' and Bouker, as secretary, verified an affidavit stating _who the officers and stockholders of the defendant were but not including the plain- ■ tiff’s name in the list of stockholders, and another affidavit that the whole amount of thé capital stock had been in good faith subscribed and paid in in cash. The defendant was organized with a capital ‘ and surplus of $1,000,000. On the thirtieth of September a bank examiner certified that the books of the Oriental Bank showed a credit to the defendant of $1,000,000, the amount of its capital and [537]*537surplus, and thereupon the Superintendent of Banks issued his certificate authorizing the defendant to transact business. The plaintiff had subscribed for twenty-five shares of stock. The date of the subscription does not appear as the subscription agreement is not dated. But it was made on one of the regular forms, and is Ho. 25, from which it may be inferred that it had been signed prior to the twenty-sixth day of September, for the receipt book, which' was the only record kept by Maxwell, either, as chairman of the incorporators or as president of the defendant, showing the payments of subscriptions, indicates that there were at least forty-four subscriptions prioi to September twenty-seventh. It may be said in passing that that book is not a record of the subscriptions to stock, as is asserted in the brief of the learned counsel for the respondent, but is a record of the receipts of payments of subscriptions. That record shows that on October second $1,000,000 had been paid in. Thereafter Maxwell received the payments of four subscriptions, including the plaintiff’s, made October 15, 1907. The subscription agreement contained this provision : “ 1 hereby authorize Howard Maxwell, as attorney for me, to enter upon the proper subscription book my subscription for said shares, or for any shares that may., be allotted me in the event-of over-subscription.” The plaintiff paid his subscription by a check payable to the order of “ Howard Maxwell, chairman,” and in return received the following receipt:
“ International Trust Company,
“Broadway and Fulton Street,
“Hew Tore, Oct. 15, 1907.
“ Received of E. G. Higginbotham Five thousand dollars in full . payment for twenty-jwe shares of stock of the International Trust Company.
“ This receipt will be exchangeable, on surrender, for engraved certificate when same are completed.
“ HOWARD MAXWELL,
'“ Chairman Organization Oom.
“ International Trust Go.
“ President.”
The words “ Chairman Organization Com.” after his signature were stricken out and the word “ President ” written in by said [538]*538Maxwell. While no doubt the subscription agreement constituted Maxwell the agent of the subscriber to enter his subscription, the receipt purports to have been the receipt of the defendant, and the agz’eement to exchange -ezzgraved certificate for the receipt püz’ports .to be the agreement of the defendant. The question- then is whether Maxwell had actual or apparent authority to bind the defendant. It seems to me that the president of a coi'poi’ation has authority to receive the payment of subscriptions for its stock, even though the corporation is a trust company which cannot transact business until all its capital stock is paid in. The defendant’s boaz:d of. dii'ectors had met and elected officers,- as they obviously had to do before the affidavits could be inade, upon which the certificate of the Superintendent of Banks' could issue. While the officers had no authority'actually to transact business before obtainiug said certificate, they did have authority to take the steps necessaz-y to obtain the certificate, one of which was the receipt of jzayments of subsciiptions. It cannot be doubted that the president had authority to issue the stock certificates. If so, it seems to follow that he had' authority to issue the-substitutes for the engraved certificates, pending the preparation of them. There is no' claim that, the plaintiff knew when he paid his subscriptiozi that' the entiz’e amount of the defendant’s capital and surplus had been paid in or even that the certificate* authorizing the defendant to do business, had then beezi issued. He denied such knowledge in liis complaint, but apparently forgot to do it on the trial. However, the inere receipt of payments of subscriptions to the entire amount of the autlioi’ized capital stock and snz'plns would not necessarily preclude receipt of other payments, because the subscription agreement contemplated. that, in case of over-subscription, there should be an allotment.
Subscriptions to stock are assets of the corpoi’ation, and there can be no doubt that a cozqzoration can maintain actions to recover such subscriptions. It must follow that in receiving payments of subscriptions and in issuing receipts, agreeing to exchange them for engi’aved certificates when prepared, the president lias authoz-ity to, and does, bind the corporation. Maxwell was the'plaintiff’s agent to enter his subscription upon the subscription books of the company, but he was the defendant’s agent to receive payment of sub[539]*539scriptions, and to issue therefor the defendant’s receipts, exchangeable for engraved certificates of stock..
However, the plaintiff did not rest upon the receipt alone, but proved that the defendant got the benefit of his subscription. On the morning of the thirtieth of September the defendant still lacked $145,000 of having the necessary $1,000,000 to its credit in the Oriental Bank. The respondent suggests that that shortage included Maxwell’s subscription of $125,000. But the only evidence in the record with respect to his subscription is the receipt book which shows that it was paid September twenty-seventh. In order to get the necessary $145,000 which was lacking, Gow, one of the defendant’s directors, requested the cashier of the Borough Bank of Brooklyn, of which Maxwell was president, ■ to send a cashier’s check for that amount. The cashier communicated with Maxwell, who authorized that to be done, and thereupon drew a cashier’s check for $145,000, payable to the order of the defendant, which was deposited by the defendant in the Oriental Bank, and thereby the defendant was enabled to procure the certificate of the Superintendent of Banks, enabling it to commence business. To keep his accounts straight the said cashier, upon the direction of Maxwell, charged $145,000 to the account of a depositor and credited. that amount to the cashier’s account. Maxwell, as chairman, kept an account in the Borough Bank in which he deposited certain moneys paid him by the subscribers to the defendant’s stock.
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Millee, J.:
. The action is for money had and received, the claim .being that the defendant accepted and-retained $5,000 of the plaintiff’s money in payment of a subscription for' twenty-five -shares of its stock after the entire authorized capital stock had been allotted. The certificate' of incorporation of the defendant was filed in the office óf the Superintendent of Banks on the' 25th day of March, 1907. On the. 26th day of September, 1907, the first meeting of its - board of directors was held at which one Howard Maxwell was elected president. He had theretofore acted as ■ chairman of the incorporators. On the twenty-seventh day of September, Maxwell, as president,' and Bouker, as secretary, verified an affidavit stating _who the officers and stockholders of the defendant were but not including the plain- ■ tiff’s name in the list of stockholders, and another affidavit that the whole amount of thé capital stock had been in good faith subscribed and paid in in cash. The defendant was organized with a capital ‘ and surplus of $1,000,000. On the thirtieth of September a bank examiner certified that the books of the Oriental Bank showed a credit to the defendant of $1,000,000, the amount of its capital and [537]*537surplus, and thereupon the Superintendent of Banks issued his certificate authorizing the defendant to transact business. The plaintiff had subscribed for twenty-five shares of stock. The date of the subscription does not appear as the subscription agreement is not dated. But it was made on one of the regular forms, and is Ho. 25, from which it may be inferred that it had been signed prior to the twenty-sixth day of September, for the receipt book, which' was the only record kept by Maxwell, either, as chairman of the incorporators or as president of the defendant, showing the payments of subscriptions, indicates that there were at least forty-four subscriptions prioi to September twenty-seventh. It may be said in passing that that book is not a record of the subscriptions to stock, as is asserted in the brief of the learned counsel for the respondent, but is a record of the receipts of payments of subscriptions. That record shows that on October second $1,000,000 had been paid in. Thereafter Maxwell received the payments of four subscriptions, including the plaintiff’s, made October 15, 1907. The subscription agreement contained this provision : “ 1 hereby authorize Howard Maxwell, as attorney for me, to enter upon the proper subscription book my subscription for said shares, or for any shares that may., be allotted me in the event-of over-subscription.” The plaintiff paid his subscription by a check payable to the order of “ Howard Maxwell, chairman,” and in return received the following receipt:
“ International Trust Company,
“Broadway and Fulton Street,
“Hew Tore, Oct. 15, 1907.
“ Received of E. G. Higginbotham Five thousand dollars in full . payment for twenty-jwe shares of stock of the International Trust Company.
“ This receipt will be exchangeable, on surrender, for engraved certificate when same are completed.
“ HOWARD MAXWELL,
'“ Chairman Organization Oom.
“ International Trust Go.
“ President.”
The words “ Chairman Organization Com.” after his signature were stricken out and the word “ President ” written in by said [538]*538Maxwell. While no doubt the subscription agreement constituted Maxwell the agent of the subscriber to enter his subscription, the receipt purports to have been the receipt of the defendant, and the agz’eement to exchange -ezzgraved certificate for the receipt püz’ports .to be the agreement of the defendant. The question- then is whether Maxwell had actual or apparent authority to bind the defendant. It seems to me that the president of a coi'poi’ation has authority to receive the payment of subscriptions for its stock, even though the corporation is a trust company which cannot transact business until all its capital stock is paid in. The defendant’s boaz:d of. dii'ectors had met and elected officers,- as they obviously had to do before the affidavits could be inade, upon which the certificate of the Superintendent of Banks' could issue. While the officers had no authority'actually to transact business before obtainiug said certificate, they did have authority to take the steps necessaz-y to obtain the certificate, one of which was the receipt of jzayments of subsciiptions. It cannot be doubted that the president had authority to issue the stock certificates. If so, it seems to follow that he had' authority to issue the-substitutes for the engraved certificates, pending the preparation of them. There is no' claim that, the plaintiff knew when he paid his subscriptiozi that' the entiz’e amount of the defendant’s capital and surplus had been paid in or even that the certificate* authorizing the defendant to do business, had then beezi issued. He denied such knowledge in liis complaint, but apparently forgot to do it on the trial. However, the inere receipt of payments of subscriptions to the entire amount of the autlioi’ized capital stock and snz'plns would not necessarily preclude receipt of other payments, because the subscription agreement contemplated. that, in case of over-subscription, there should be an allotment.
Subscriptions to stock are assets of the corpoi’ation, and there can be no doubt that a cozqzoration can maintain actions to recover such subscriptions. It must follow that in receiving payments of subscriptions and in issuing receipts, agreeing to exchange them for engi’aved certificates when prepared, the president lias authoz-ity to, and does, bind the corporation. Maxwell was the'plaintiff’s agent to enter his subscription upon the subscription books of the company, but he was the defendant’s agent to receive payment of sub[539]*539scriptions, and to issue therefor the defendant’s receipts, exchangeable for engraved certificates of stock..
However, the plaintiff did not rest upon the receipt alone, but proved that the defendant got the benefit of his subscription. On the morning of the thirtieth of September the defendant still lacked $145,000 of having the necessary $1,000,000 to its credit in the Oriental Bank. The respondent suggests that that shortage included Maxwell’s subscription of $125,000. But the only evidence in the record with respect to his subscription is the receipt book which shows that it was paid September twenty-seventh. In order to get the necessary $145,000 which was lacking, Gow, one of the defendant’s directors, requested the cashier of the Borough Bank of Brooklyn, of which Maxwell was president, ■ to send a cashier’s check for that amount. The cashier communicated with Maxwell, who authorized that to be done, and thereupon drew a cashier’s check for $145,000, payable to the order of the defendant, which was deposited by the defendant in the Oriental Bank, and thereby the defendant was enabled to procure the certificate of the Superintendent of Banks, enabling it to commence business. To keep his accounts straight the said cashier, upon the direction of Maxwell, charged $145,000 to the account of a depositor and credited. that amount to the cashier’s account. Maxwell, as chairman, kept an account in the Borough Bank in which he deposited certain moneys paid him by the subscribers to the defendant’s stock. On the tenth of October there was a credit to that account of $105,000, and on that date the cashier, at his direction, transferred that amount to the credit of the account from which the $145,000 had been taken, and on the sixteenth of October the- further sum of $12,000, which included the plaintiff’s $5,000, was likewise trans-' ferred. Thus $117,000 of the money misappropriated to enable the defendant to begin business was repaid from tlm money collected by Maxwell from subscribers, including the plaintiff. It seems to me that the case is precisely the same as though the said $117,000 had in the first instance been deposited in the Oriental Bank to the credit of the defendant. It is of no consequence that the identical money collected on the plaintiff’s check did not reach the defendant. The money which was first stolen went into the defendant’s treasury, and the defendant received the benefit of it. If that [540]*540theft had not been made good the defendant could have been compelled to repay the sum stolen. Maxwell- repaid it by using $117,000 of the money received by him in jiayment for subscriptions to the defendant’s stock. -'How the other $28,000 was refunded is now of no consequence. Thus the defendant’s liability was discharged'in part with the plaintiff’s money, and it seems to me that it is refining altogether too much to say -that the.defendant did not have the benefit of that money. If it had in fact gone directly into the defendant’s treasury the case would be plain. That was the result of the transaction if regard be had to substance rather than form.
The judgment and order should be reversed and a new trial granted, with costs to appellant to abide the event.
Clarke and Dowling, JJ., concurred; Ingraham, P. J.,' and Scott, J., dissented.