Opinion by
Me,. Justice Elkin,
If Nicholas Heblich can be considered under the facts of this case a liquidating trustee of the appellant, it necessarily follows that the cause of action was properly disposed of in the court below. It is conceded that neither the stockholders nor the board of directors by any formal act, or vote, or written authority, in express terms constituted him a liquidating trustee. We' do not consider this necessary. The stockholders of a corporation, like members of a partnership, company or association, may, by permitting a person to act for and represent the corporation in all matters pertaining to the collection of debts, payment of liabilities, settlement of accounts, distribution of proceeds and doing other acts pertaining to the winding up of the business, confer by acquiescence and assent such powers upon the person so acting as will constitute him a liquidating trustee within the meaning of the law. So far as the evidence shows the appellant did not pursue the statutory requirements in respect to the winding up of the business of the corporation. The provisions of the Act of April 9, 1856, P. L. 293 might have been followed, but the record in this case is entirely silent on the subject. We gather from the facts, however, that this method was not adopted. The act of 1856 recognizes the application of the general rules in reference to the accounts of assignees and trustees in such cases. Lithe construction of that statute our courts have applied equitable principles. In Lauman v. Lebanon Valley Railroad Co., 30 Pa. 42, Mr. Chief Justice Lowbie said: “ The act of dissolution, like the act of association, is not a corporate act, but an act of the members of the corporation. They may commit to their officers the business of effecting it in all its details, but they are not requii'ed to do so by the terms of their association and in effecting such a purpose the officers would be rather trustees of the members than corporate functionaries.” See also Bailey’s Appeal, 96 Pa. 253; in re Credit Mobilier of America, 10 Phila. 2. These authorities indicate that the rules of law applied by the courts to acts done by directors or officers of corporations [572]*572relating to the dissolution thereof are the equitable principles governing trustees or others acting in a fiduciary capacity. Our courts have long recognized this principle in dealing with partners. Garretson v. Brown, 185 Pa. 447, was a case in which the opinion of the master was affirmed by this court. In discussing this question, the master said: “ It seems to be clear from all of the cases that formal action by way of vote, or written document, or similar process, is not a prerequisite to the exercise of such right by one member of a partnership, or to the legal imposition upon the partner so acting of all the duties and consequent responsibility of such office:” Wilson v. Waugh, 101 Pa. 233 ; Siegfried v. Ludwig, 102 Pa. 547; Campbell v. Floyd, 153 Pa. 84; Jutte v. Hutchinson, 189 Pa. 218. We see no good reason why the same rule should not apply to a member of the board of directors, the secretary and attorney for the corporation, who for a period of twenty-five years, having the possession of the books, papers and assets of the corporation, exercising with the acquiescence and consent of the stockholders, authority to do every act and perform every duty which the corporation itself might have done should not be held to be a liquidating trustee. We must therefore consider Nicholas Heblich a liquidating trustee, and notice to him under the circumstances of this case was notice to the bank, and its failure to assert right to or ownership of the certificates of stock, the value of which is involved in this controversy, for a period of more than thirty years after it obtained possession of the same as collateral security for a loan, and almost twenty years after an amicable action had been instituted in the court of common pleas of Schuylkill county for the purpose of determining to whom the dividends should be.paid, on which action judgment was entered, of which action and judgment the bank is presumed to have notice through its liquidating trustee, is such laches as will preclude the appellant from recovering in this case.
On January 5, 1878, the board of directors of the appellant bank adopted a resolution to close its doors on the following Saturday and wind up its business, unless otherwise directed by the stockholders at a meeting to be called prior to that time. The evidence does not disclose what action was taken by the stockholders, but inasmuch as the bank did proceed to wind [573]*573up its business and settle its affairs, it must be presumed tbat the stockholders adopted tbe resolution of the board of directors and authorized the winding up of the corporate business. Nothing is shown by the record to throw any light upon the manner in which the business was closed out. The last formal meeting of said board was held August 22, 1878, at which a resolution was adopted authorizing the bank property, consisting of books, notes, papers and other assets, to be removed from the bank building to the office of Nicholas Heblich. In accordance with this authority the books, notes, papers and other personal property, including the bank safe, were so removed, where they remained under his care, supervision and control until his decease December 24, 1902. The meeting of the board of directors August 22, 1878, was the last at which formal action was taken upon the affairs of the company and spread upon the minute book. After the removal of the assets, books and accounts of the bank to the office of Heblich in August, 1878, he was permitted to exercise absolute authority in the matter of disposing of the property of the bank, collecting the notes, making settlement of accounts, and in the performance of every act, duty or thing in which the' bank was interested. The bank went out of business in 1878, and has not performed any corporate act from that time until the institution of this proceeding, except it is claimed by counsel, and not disputed, that some kind of informal meetings were held from time to time for the purpose of electing nominal officers to preserve the franchise and corporate entity of the bank.
Let us see how these facts affect the rights of the parties to this action. On April 10, 1872, John Wadlinger, who was the owner of thirty-one shares of stock in the defendant water company, delivered the certificates therefor with an irrevocable power of attorney to the president of the appellant bank, which power of attorney authorized said president to transfer the certificates of stock to the bank. This stock was pledged as collateral security for a loan made to Wadlinger. It stood in the name of Wadlinger on the books of the defendant company at that time. On September 26, 1872, Wadlinger in company with Frederick Roehrig went to Jacob S. Lawrence, treasurer of the defendant company, who had charge of the stock ledger, [574]*574the only book in which transfers were made, and entered thereon an assignment of the shares of stock in question to the said Frederick Roehrig. This assignment was properly executed by Wadlinger in the presence of a witness. On the same day the treasurer charged the stock account of Wadlinger with the shares so transferred, and credited the account of Roehrig with the same. Wadlinger did not produce the original certificates at the time the transfer was made, alleging to the treasurer that he had mislaid or lost them.
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Opinion by
Me,. Justice Elkin,
If Nicholas Heblich can be considered under the facts of this case a liquidating trustee of the appellant, it necessarily follows that the cause of action was properly disposed of in the court below. It is conceded that neither the stockholders nor the board of directors by any formal act, or vote, or written authority, in express terms constituted him a liquidating trustee. We' do not consider this necessary. The stockholders of a corporation, like members of a partnership, company or association, may, by permitting a person to act for and represent the corporation in all matters pertaining to the collection of debts, payment of liabilities, settlement of accounts, distribution of proceeds and doing other acts pertaining to the winding up of the business, confer by acquiescence and assent such powers upon the person so acting as will constitute him a liquidating trustee within the meaning of the law. So far as the evidence shows the appellant did not pursue the statutory requirements in respect to the winding up of the business of the corporation. The provisions of the Act of April 9, 1856, P. L. 293 might have been followed, but the record in this case is entirely silent on the subject. We gather from the facts, however, that this method was not adopted. The act of 1856 recognizes the application of the general rules in reference to the accounts of assignees and trustees in such cases. Lithe construction of that statute our courts have applied equitable principles. In Lauman v. Lebanon Valley Railroad Co., 30 Pa. 42, Mr. Chief Justice Lowbie said: “ The act of dissolution, like the act of association, is not a corporate act, but an act of the members of the corporation. They may commit to their officers the business of effecting it in all its details, but they are not requii'ed to do so by the terms of their association and in effecting such a purpose the officers would be rather trustees of the members than corporate functionaries.” See also Bailey’s Appeal, 96 Pa. 253; in re Credit Mobilier of America, 10 Phila. 2. These authorities indicate that the rules of law applied by the courts to acts done by directors or officers of corporations [572]*572relating to the dissolution thereof are the equitable principles governing trustees or others acting in a fiduciary capacity. Our courts have long recognized this principle in dealing with partners. Garretson v. Brown, 185 Pa. 447, was a case in which the opinion of the master was affirmed by this court. In discussing this question, the master said: “ It seems to be clear from all of the cases that formal action by way of vote, or written document, or similar process, is not a prerequisite to the exercise of such right by one member of a partnership, or to the legal imposition upon the partner so acting of all the duties and consequent responsibility of such office:” Wilson v. Waugh, 101 Pa. 233 ; Siegfried v. Ludwig, 102 Pa. 547; Campbell v. Floyd, 153 Pa. 84; Jutte v. Hutchinson, 189 Pa. 218. We see no good reason why the same rule should not apply to a member of the board of directors, the secretary and attorney for the corporation, who for a period of twenty-five years, having the possession of the books, papers and assets of the corporation, exercising with the acquiescence and consent of the stockholders, authority to do every act and perform every duty which the corporation itself might have done should not be held to be a liquidating trustee. We must therefore consider Nicholas Heblich a liquidating trustee, and notice to him under the circumstances of this case was notice to the bank, and its failure to assert right to or ownership of the certificates of stock, the value of which is involved in this controversy, for a period of more than thirty years after it obtained possession of the same as collateral security for a loan, and almost twenty years after an amicable action had been instituted in the court of common pleas of Schuylkill county for the purpose of determining to whom the dividends should be.paid, on which action judgment was entered, of which action and judgment the bank is presumed to have notice through its liquidating trustee, is such laches as will preclude the appellant from recovering in this case.
On January 5, 1878, the board of directors of the appellant bank adopted a resolution to close its doors on the following Saturday and wind up its business, unless otherwise directed by the stockholders at a meeting to be called prior to that time. The evidence does not disclose what action was taken by the stockholders, but inasmuch as the bank did proceed to wind [573]*573up its business and settle its affairs, it must be presumed tbat the stockholders adopted tbe resolution of the board of directors and authorized the winding up of the corporate business. Nothing is shown by the record to throw any light upon the manner in which the business was closed out. The last formal meeting of said board was held August 22, 1878, at which a resolution was adopted authorizing the bank property, consisting of books, notes, papers and other assets, to be removed from the bank building to the office of Nicholas Heblich. In accordance with this authority the books, notes, papers and other personal property, including the bank safe, were so removed, where they remained under his care, supervision and control until his decease December 24, 1902. The meeting of the board of directors August 22, 1878, was the last at which formal action was taken upon the affairs of the company and spread upon the minute book. After the removal of the assets, books and accounts of the bank to the office of Heblich in August, 1878, he was permitted to exercise absolute authority in the matter of disposing of the property of the bank, collecting the notes, making settlement of accounts, and in the performance of every act, duty or thing in which the' bank was interested. The bank went out of business in 1878, and has not performed any corporate act from that time until the institution of this proceeding, except it is claimed by counsel, and not disputed, that some kind of informal meetings were held from time to time for the purpose of electing nominal officers to preserve the franchise and corporate entity of the bank.
Let us see how these facts affect the rights of the parties to this action. On April 10, 1872, John Wadlinger, who was the owner of thirty-one shares of stock in the defendant water company, delivered the certificates therefor with an irrevocable power of attorney to the president of the appellant bank, which power of attorney authorized said president to transfer the certificates of stock to the bank. This stock was pledged as collateral security for a loan made to Wadlinger. It stood in the name of Wadlinger on the books of the defendant company at that time. On September 26, 1872, Wadlinger in company with Frederick Roehrig went to Jacob S. Lawrence, treasurer of the defendant company, who had charge of the stock ledger, [574]*574the only book in which transfers were made, and entered thereon an assignment of the shares of stock in question to the said Frederick Roehrig. This assignment was properly executed by Wadlinger in the presence of a witness. On the same day the treasurer charged the stock account of Wadlinger with the shares so transferred, and credited the account of Roehrig with the same. Wadlinger did not produce the original certificates at the time the transfer was made, alleging to the treasurer that he had mislaid or lost them. On March 15, 1873, Wadlinger made an affidavit which was presented to the board of directors, stating therein that he had lost or mislaid said certificates of stock; that he had sold or transferred the same to Frederick Roehrig, and authorized and instructed the defendant company to issue new certificates to said Roehrig. The evidence shows that Roehrig acted in good faith as a bona fide purchaser for value, without notice of the fact that the original certificates had been transferred to the plaintiff bank as collateral security for the loan of Wadlinger. Although new certificates were not issued to Roehrig at that time, his name was entered on the books of the company as a stockholder and dividends on the stock were regularly paid to him or his representative until 1881. Prior to this time the water company did not have notice or knowledge of the fact that Wadlinger had pledged these certificates of stock to the bank.In 1881 the water company was informed that the original certificates were held by the bank as collateral security for the debt of Wadlinger. The board of directors of said water company thereupon adopted a resolution instructing the treasurer not to pay any more dividends to Roehrig or any other claimant until it was ascertained to whom the stock belonged. In the meantime Roehrig died and his interest in these certificates of stock passed by his will to his widow. On September 1, 1882, an amicable action in assumpsit was entered in the court of common pleas of Schuylkill County between Dorathea Roehrig, who was the widow of Frederick Roehrig, deceased, and the Minersville Water Company, for the purpose of determining whether said plaintiff was entitled to recover the dividends declared and unpaid on said stock. On November 20th following the defendant water company presented a petition to the court setting out these facts, and asking for a [575]*575rule upon the appellant bank to show cause why it should not intervene in order that all of the rights of the parties might be determined in that proceeding. The court refused to grant the rule without assigning any reason therefor. It does not appear from the evidence whether the bank had formal and legal notice of the institution of the amicable action or the presentation of the petition asking that a rule be granted to show cause why it should not intervene. The inference is, however, that it did have notice of the proceedings for the reason that seven days elapsed from the filing of the petition until the order of the court was made refusing the same, the reasonable presumption being that this time was taken for the purpose of giving notice and hearing the parties interested. At this time the bank had been out of business for five years. The only person acting for and representing it was the said Nicholas Heblich. When the case came on for trial a few months later he was called as a witness, and testified in detail to matters concerning said certificates of stock, and where and how they were held by the bank. He admitted the bank held them as collateral, but he did not assert ownership of the bank in the stock. As we have already said, notice to Heblich was notice to the bank. It is idle, therefoi’e, to say that the bank did not have notice sufficient to require it to assert whatever rights it claimed in said stock within a reasonable time. The case was tried under the Act of April 22, 1874, P. L. 109 without a jury. The court found the facts and entered judgment in favor of the plaintiff for the amount of the unpaid dividends, stating in the opinion that the question of the rights of the Pottsville Bank was not passed on. Judgment was entered July 2,1883. The water company then paid the amount of the judgment and continued to pay Dorathea Roehrig all dividends on said stock as they were declared thereafter. On August 6, 1883, new certificates of stock were issued to the said Dorathea Roehrig for the shares in controversy, this action by the water company being predicated upon the finding of the court that if she was entitled to the dividends she was also entitled to the certificates of stock. From the 6th of August, 1883, when the new certificate was issued to Dorathea Roehrig, until March 17, 1903, the appellant made no demand for nor asserted any ownership in this stock. [576]*576During this long period of time it remained quiet, failing to assert any rights either for the dividends declared or to the certificates. Certainly these facts bring the case within that familiar rule that if one by his acts or silence or negligence misleads another, or effects a transaction whereby an innocent party suffers, the blamable party must bear the loss. We fail to see how the appellee can be held liable in this action which is predicated upon the supposed negligence or tortious acts of the water company. The evidence clearly shows that the defendant acted in good faith and with business prudence throughout the whole transaction. It is well known in the common experience of corporations that certificates of stock are sometimes lost or destroyed, and when these facts are properly made known to the officers of the company new certificates are issued, generally under the express provisions of the by-laws regulating such matters. It does not appear from the evidence whether the water company had provided for such contingencies in its by-laws, although it was argued that no such power had been granted. It would seem, however, such authority may be presumed from custom acted upon and not disputed for a long period of time. The appellee was justified in relying upon the adjudication of the court, which for all practical purposes decided that Dorathea Roehrig was entitled to said shares of stock unless the bank holding the original certificates should show its superior right within a reasonable time by due course of law. Having lain by and failed to do so it cannot be heard to complain when the rights of innocent third parties have become permanently fixed. It is true that this is an action at law, but in our State the doctrine is firmly established that equity is administered through common law forms. This is a case for the assertion of the maxim vigilantibus non dormientibus jura subveniunt. It is unnecessary to discuss the other questions raised by the assignments.
Judgment affirmed.