FOLLETT, J.
The individual defendants, under their firm name, organized the Anglo-American Company, and each partner is liable for the misrepresentations and concealments of the others committed while engaged in promoting the enterprise. Chester v. Dickerson, 54 N. Y. 1; Getty v. Devlin, Id. 408; Locke v. Stearns, 1 Metc. (Mass.) 560; Rapp. v. Latham, 2 Barn. & Aid. 793; 1 Lindl. Partn. (3d Eng. Ed.) 34, 320, 389; Story, Partn. §§ 108,181; Bigelow, Fraud, 240, 246. Burnham is equally liable with his partners for their misrepresentations and concealments. The individual defendants, under their firm name, organized the corporation, fixed [436]*436the amount of the capital stock, and determined the time when, and the terms upon which, the corporation should be formed. They appointed agents to receive subscriptions for shares, fixed their price, and the compensation to be paid the agents. All this was done before the corporation was created; and they, as a firm, received the money of the plaintiff and of others for shares in advance of the formation of the company. How the defendants applied this money does not appear. The defendants were the promoters of this corporation; and persons who undertake to form a corporation, and induce others to subscribe for stock therein by issuing statements and prospectuses, occupy a position of trust and confidence towards the persons so induced to subscribe for shares to be issued, and they are bound to exercise the utmost good faith in their transactions. If they make material misrepresentations or conceal material facts in respect to the enterprise to the injury of those who are induced' to subscribe, they become liable for damages. Brewster v. Hatch, 122 N. Y. 349, 25 N. E. Rep. 505; Getty v. Devlin, 54 N. Y. 408; Erlanger v. Phosphate Co., 3 App. Cas. 1218, 1 Mor. Priv. Corp. (2d Ed.) § 291. The liability of promoters is not limited to subscribers whom they personally induce to take shares, but it extends to ‘all those who are induced by their agents to subscribe for shares; and if they make material misrepresentations to, or conceal material facts from, their agents, who, relying on the statements, induce persons to become subscribers, the promoters are liable for the damages. It is a familiar principle that what one does by his agent he does by himself. The scheme which was organized by the defendants, and carried out in part through the’ir agents, was the proximate cause of the plaintiff’s damages, and, no intervening and responsible principal standing between the plaintiff and defendants, the latter are liable to the former to the same extent as if they had personally, by false representations and concealments, induced Mm to become a subscriber. Getty v. Devlin, supra A purchaser of shares in an existing corporation from a stockholder has no interest in the application of the money which he pays for the shares, but it is quite different with one who agrees to subscribe for shares in a corporation to be created. The difference is well stated by Chief Justice Coleridge in Twycross v. Grant, 2 C. P. Div. 488. He said:
“The value of a share In a company, however, depends not only on those circumstances which regulate the value of all saleable commodities, but also on the persons by whom, and the mode in which, the capital of the company is to be dealt with. It is utterly immaterial to an ordinary purchaser to know what the vendor will do with the purchase money when he gets it; the purchaser has no further interest in it. But an applicant for shares in a company is in a totally different position. His money becomes part of the capital of the compan)-, and to him it is 'all important to know what sort of persons are to have the control of his money when he has paid it, and how that money is to be applied, whether upon the enterprise itself, or in remunerating, perhaps with slavish extravagance, those who have brought the company into existence. Again, it is all-important for him .to know whether shares applied for by other people are applied for honestly, as by himself, or by persons whose only object is to create a fictitious demand for the shares, and to get rid of them as soon as they have succeeded in deluding others to [437]*437take them on the faith of their apparent value. Now, these are all matters which promoters may arrange for their own benefit, and keep entirely out of sight; and it is notorious that by taking advantage of their opportunities in this respect, promoters have committed gigantic frauds.”
This brings us to the question whether the defendants did make materially false statements to, and conceal material facts from, their agents, with the intent of inducing, and which actually did induce, such agents to recommend and advise the plaintiff to subscribe for shares. The court found that Burnham, Tulleys &. Co. wrote the letters and issued the circular which are set out in the statements of facts. In the letter of March 20, 1888, they wrote:
“We repeat that we expect to be liberal takers of this stock, and would not dispose of any of it if we did not think the last-mentioned object [a larger line of customers] would be attained.”
The whole tenor of these letters is to the effect that Burnham, Tulleys & Co. were to take a large proportion of the shares to be issued, and that the corporation was to be managed by the members of the firm in the same manner that their business had been previously managed. There is no hint 'in the letters or circular that any of the shares were to be issued except for cash, or that any were to be issued to members of the firm for good will.
The court found:
“(10) The statement in said circular that ‘the proposed capital is $500,000, a large part of which has been taken by ourselves,’ was untrue, and designed to mislead and deceive A. Walker & Co.
“(11) The statement that ‘the company will be under the management of the members of said firm’ was untrue, and designed to mislead and deceive A. Walker & Co.
“(12) On and after the organization of the corporation, defendant Albert C. Burnham held no office of any sort in said corporation.”
“(15) Burnham, Tulleys & Co. never disclosed to A. Walker & Co. the fact of the execution of the agreement of February 24, 1888, respecting good-will stock, nor the fact that $100,000 of good-will stock was to be issued to the members of the firm upon its incorporation.
“(16) From the correspondence and dealings of A. W'alker & Co. and Bum-ham, Tulleys & Co. with respect to the incorporation, A. Walker & Co. believed, and had reason to believe, that subscribers for stock, whether members of the firm or outsiders, stood on equal footing.”
The court also found that Alfred Walker Sc Co. had not seen the circular of April 2d when they effected the sale of the stock to the plaintiff and obtained his subscription, and did not rely upon the statements contained therein in effecting the sale to the plaintiff and in taking his subscription.
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FOLLETT, J.
The individual defendants, under their firm name, organized the Anglo-American Company, and each partner is liable for the misrepresentations and concealments of the others committed while engaged in promoting the enterprise. Chester v. Dickerson, 54 N. Y. 1; Getty v. Devlin, Id. 408; Locke v. Stearns, 1 Metc. (Mass.) 560; Rapp. v. Latham, 2 Barn. & Aid. 793; 1 Lindl. Partn. (3d Eng. Ed.) 34, 320, 389; Story, Partn. §§ 108,181; Bigelow, Fraud, 240, 246. Burnham is equally liable with his partners for their misrepresentations and concealments. The individual defendants, under their firm name, organized the corporation, fixed [436]*436the amount of the capital stock, and determined the time when, and the terms upon which, the corporation should be formed. They appointed agents to receive subscriptions for shares, fixed their price, and the compensation to be paid the agents. All this was done before the corporation was created; and they, as a firm, received the money of the plaintiff and of others for shares in advance of the formation of the company. How the defendants applied this money does not appear. The defendants were the promoters of this corporation; and persons who undertake to form a corporation, and induce others to subscribe for stock therein by issuing statements and prospectuses, occupy a position of trust and confidence towards the persons so induced to subscribe for shares to be issued, and they are bound to exercise the utmost good faith in their transactions. If they make material misrepresentations or conceal material facts in respect to the enterprise to the injury of those who are induced' to subscribe, they become liable for damages. Brewster v. Hatch, 122 N. Y. 349, 25 N. E. Rep. 505; Getty v. Devlin, 54 N. Y. 408; Erlanger v. Phosphate Co., 3 App. Cas. 1218, 1 Mor. Priv. Corp. (2d Ed.) § 291. The liability of promoters is not limited to subscribers whom they personally induce to take shares, but it extends to ‘all those who are induced by their agents to subscribe for shares; and if they make material misrepresentations to, or conceal material facts from, their agents, who, relying on the statements, induce persons to become subscribers, the promoters are liable for the damages. It is a familiar principle that what one does by his agent he does by himself. The scheme which was organized by the defendants, and carried out in part through the’ir agents, was the proximate cause of the plaintiff’s damages, and, no intervening and responsible principal standing between the plaintiff and defendants, the latter are liable to the former to the same extent as if they had personally, by false representations and concealments, induced Mm to become a subscriber. Getty v. Devlin, supra A purchaser of shares in an existing corporation from a stockholder has no interest in the application of the money which he pays for the shares, but it is quite different with one who agrees to subscribe for shares in a corporation to be created. The difference is well stated by Chief Justice Coleridge in Twycross v. Grant, 2 C. P. Div. 488. He said:
“The value of a share In a company, however, depends not only on those circumstances which regulate the value of all saleable commodities, but also on the persons by whom, and the mode in which, the capital of the company is to be dealt with. It is utterly immaterial to an ordinary purchaser to know what the vendor will do with the purchase money when he gets it; the purchaser has no further interest in it. But an applicant for shares in a company is in a totally different position. His money becomes part of the capital of the compan)-, and to him it is 'all important to know what sort of persons are to have the control of his money when he has paid it, and how that money is to be applied, whether upon the enterprise itself, or in remunerating, perhaps with slavish extravagance, those who have brought the company into existence. Again, it is all-important for him .to know whether shares applied for by other people are applied for honestly, as by himself, or by persons whose only object is to create a fictitious demand for the shares, and to get rid of them as soon as they have succeeded in deluding others to [437]*437take them on the faith of their apparent value. Now, these are all matters which promoters may arrange for their own benefit, and keep entirely out of sight; and it is notorious that by taking advantage of their opportunities in this respect, promoters have committed gigantic frauds.”
This brings us to the question whether the defendants did make materially false statements to, and conceal material facts from, their agents, with the intent of inducing, and which actually did induce, such agents to recommend and advise the plaintiff to subscribe for shares. The court found that Burnham, Tulleys &. Co. wrote the letters and issued the circular which are set out in the statements of facts. In the letter of March 20, 1888, they wrote:
“We repeat that we expect to be liberal takers of this stock, and would not dispose of any of it if we did not think the last-mentioned object [a larger line of customers] would be attained.”
The whole tenor of these letters is to the effect that Burnham, Tulleys & Co. were to take a large proportion of the shares to be issued, and that the corporation was to be managed by the members of the firm in the same manner that their business had been previously managed. There is no hint 'in the letters or circular that any of the shares were to be issued except for cash, or that any were to be issued to members of the firm for good will.
The court found:
“(10) The statement in said circular that ‘the proposed capital is $500,000, a large part of which has been taken by ourselves,’ was untrue, and designed to mislead and deceive A. Walker & Co.
“(11) The statement that ‘the company will be under the management of the members of said firm’ was untrue, and designed to mislead and deceive A. Walker & Co.
“(12) On and after the organization of the corporation, defendant Albert C. Burnham held no office of any sort in said corporation.”
“(15) Burnham, Tulleys & Co. never disclosed to A. Walker & Co. the fact of the execution of the agreement of February 24, 1888, respecting good-will stock, nor the fact that $100,000 of good-will stock was to be issued to the members of the firm upon its incorporation.
“(16) From the correspondence and dealings of A. W'alker & Co. and Bum-ham, Tulleys & Co. with respect to the incorporation, A. Walker & Co. believed, and had reason to believe, that subscribers for stock, whether members of the firm or outsiders, stood on equal footing.”
The court also found that Alfred Walker Sc Co. had not seen the circular of April 2d when they effected the sale of the stock to the plaintiff and obtained his subscription, and did not rely upon the statements contained therein in effecting the sale to the plaintiff and in taking his subscription. But this finding does not relieve the defendants from liability, for under the letters which they put forth they were bound to procure the corporation to be organized upon the basis of all subscribers paying par value in cash for the shares to be issued, which they did not do, but issued to themselves one-fifth of the entire capital for so-called "good will.” In addition to this, the corporation was not placed under the management of the members of the firm, nor did they become liberal takers of the stock, as they represented they would [438]*438be. Burnham took no shares except the $30,000 issued to him for good will, and never assumed the management of the affairs of the corporation.
The court was asked to find that the statements and the correspondence were designed to mislead not only A. Walker & Co., but persons intending to become subscribers for the shares. The court found, as above stated, that the statements and the correspondence were designed to mislead A. Walker & Co., but refused to find that they were designed to mislead subscribers, to which refusal the plaintiff excepted. This, we think, was error. If the statements were put forth with the design to mislead and deceive A. Walker & Co., the agents of the defendants for procuring subscriptions, it is difficult to see why it does not follow that they were put forth with the intention of deceiving those who might subscribe for shares. The inference of fraud from the facts proved is as strong in the one case as it is in the other. Upon a retrial of this case, if one shall be had, it must be disclosed upon what terms other subscriptions were made, to whom the shares were first issued, and what disposition was made by the defendants of the funds received by them. We think the judgment should be reversed, and a new trial ordered, with costs to the appellant to abide the event. All concur.