3 See § 147, post.

4 See § 147, post.

5 See §§171, 133, port.

6 See note 2, §186, post.

The disregard of these conceptions of the common law, both by courts and text-writers, has caused the many irreconcilable differences between courts upon ordinary questions in banking law. Those generations "which knew not Jacob " have entailed the expiation of their sins upon us. And it is the idea of bailment which, properly carried out, will render banking law symmetrical and uniform the country over. But in other spheres of law banking has caused a great development, especially in the law of agency and stockholders. A bank, being officered by men generally of wide interests and of large business connections, finds itself involved in transactions where its officer and agent is frequently acting for himself or for some one else. These questions generally arise in the law of banking. And here again the common law comes forward with its principle of identity which it has borrowed from the Roman law - a principle which an American juridical scholar has developed by his influence upon one court, and by his writings, which lend to our jurisprudence some of the glory which clings round an Ulpian or a Trebonian. In the blunt phrase of the Roman annotator this identity arises non rei veritate, sed fictione; it was adopted by our common law after the fullest consideration of its advantages, and after the experience of centuries of that system which knew it not; it solves many a troublesome question in the law of agency, and stamps with disapproval the lucubrations of those courts which seek for a basis of the identity of principal and agent, where the agent duly authorized is acting on the principal's business, in some such presumption as that the agent will communicate his knowledge to his principal. Such reasoning, as we shall see, is futile when applied to a transaction where principal andagent are identical, and has been productive only of confusion.8 A correct appreciation of this principle is the only test by which questions of this character can be decided: The want of this appreciation has caused the text-writers to darken counsel upon this subject by words without knowledge. But in another phase of the law of agency the business of banking has offered much material for judicial exposition. The relation of a director or officer to his corporation has been involved in a complete fog by the fact that some very able judges have been blind to the fact that the keeping open of an insolvent bank by directors, either wilfully or negligently, is one thing, and that negligent management of a bank is a totally different thing. On this subject, too, the text-writers have not given us any light, because they have not taken care to find that their light was but darkness. In the domain of the law of stockholders the usual liability of double the stock subscription imposed by statute upon stockholders has produced a great development; and here again, the conception of quasi-contract explains for us that this liability is not a contract, though the supreme court of the United States, in days when a quasi-con tract was not well understood, has told us that it was.9 This law of quasi-contract informs us that the quasi-con tract imposed by the statute is not a contract obligation; but nevertheless the obligation and the duty of a man to perform the quasi-con tract gives a valuable and vested right to the man to whom the duty is owed, and as to past transactions cannot be taken away by statute, because to do so would be a confiscation of property - a taking without due compensation. This conception proves, as we shall see, that the supreme court of the United States gave a wrong reason for a very righteous decision, which is not an unusual phenomenon in the progress of the law. Again, the subject of banking law gives a wide sphere for the action of the healing and healthful doctrine of quasi-con tract in regard to acts done beyond the sphere of corporate power, than which no subject in the law has been examined by our highest court with less perception of the effect of quasi-contract upon legal obligations.10 Finally, the law of banking offers a wide and extended field for the operation of customs in adding terms to contracts or quasi-contracts,11 in defining the duties of officers of banks as well as their powers,12 and in circumscribing the appropriate sphere of banking transactions. It is then for the reasons stated above that the law of banking is distinctive. Its doctrine of bailment runs a line of demarcation between it and other businesses as plain as the division which separates that of common carriers from other businesses, while the field of operation which it affords for an application of the doctrines of quasi-contract makes it no less distinctive. Being so distinctive, it is hoped that a work upon this subject may aid in showing the proper application of general principles in a peculiar field.

7 See§§133, 187, 188. post

8 See §§ 111, 112,106, 107,post

9 See §63, post

Where a business which is so important as that of banking is found exposed to contradictory rules of law, it is especially needful to point out the better and safer rule. It needs especial emphasis in these times that a banker is of all men entitled to a certain and fixed rule of law, because he has confided to him the pecuniary interests of so many people. He is using and investing a fund with which all classes in the community have a direct connection. But when we find that in the same state the banker must conform himself to doctrines that are absolutely irreconcilable, and, if he follows the one rule, another court in the same jurisdiction following the opposite rule is bound to hold him for violating its rule, it is patent that the law needs some rectification in those jurisdictions.13 The rules of law applicable to banking transactions are not of the character of those principles which have become rules of property. Those jurisdictions which have adopted an erroneous rule will find that the inconveniences of the rule will cause it to be evaded by the business world, and a change in the rule would make thelaw conform to the settled business practice, and would cause hardship to no one.