" So in Fellows v. Stevens (24 Wend. 294), Justice COWEN held that the law would set aside "all secret terms made by the creditors with the debtor, more favorable to the former than is allowed to the other creditors." It is the secret agreement itself which is fraudulent and void. ( Bliss v. Matteson, 45 N.Y. 22; Harloe v. Foster, 53 id. 385.) And that is all that I think Leicester v. Rose decided.

The effect of the arrangement which plaintiff claims he had with the defendants was to make a bargain with them to violate his duty toward his corporation. An agreement which is designed, or which in its nature and effect tends to lead persons who are charged with the performance of trusts or duties for the benefit of others to violate or betray them, is contrary to public policy and void and cannot be enforced. ( Bliss v. Matteson, 52 Barb. 335; affd., 45 N.Y. 22; Moss v. Cohen, 11 Misc. Rep. 184; West v. Camden, 135 U.S. 507; Barkley v. Williams, 26 Ill. App. 213. ) Such a contract with a third person is not made valid although the acts of the unfaithful agent may have in fact resulted in benefit to his principal ( Lum v. McEwen, 56 Minn. 278; nor by the fact that the unfaithful director of a corporation informed his codirectors of his corrupt bargain.

We think this principle is equally applicable, on the ground of public policy, although there was not to be any direct private gain to the defendant; for, as was said by the Circuit Court in this case, it was the right of the other stockholders in the Baltimore United Oil Company "to have the defendant's judgment, as an officer of the company, exercised with a sole regard to the interests of the company." A personal liability for damages on the part of the defendant, in case the plaintiff should be removed after an agreement of the character alleged, was calculated to be a strong incentive to the defendant to act contrary to the true interests of the company and of its other stockholders. Bliss v. Matteson, 45 N.Y. 22; 1 Morawetz Corp. §§ 516, 519. These views cover also the last instruction to the jury; and it becomes unnecessary to examine the question raised as to the second instruction, which was to the effect that, as the alleged contract was not in writing, the plaintiff could not recover upon it, because it was invalid under the fifth clause of the fourth section of the statute of frauds of Maryland, as being an agreement not to be performed within the space of one year from the making thereof; for, even though that might have been an erroneous instruction, it did no harm to the plaintiff, because he could not recover in any event. Deery v. Cray, 5 Wall. 795, 807; The Schools v. Risley, 10 Wall. 91, 115; Deery v. Cray, 10 Wall. 263, 272; Brobst v. Brock, 10 Wall. 519, 528; Barth v. Clise, 12 Wall. 400, 403; Tweed's Case, 16 Wall. 504, 517; Walbrun v. Babbitt, 16 Wall. 577, 580, 581; Decatur Bank v. St. Louis Bank, 21 Wall. 294, 301; McLemore v. Louisiana State Bank, 91 U.S. 27, 28; Mobile

A personal liability for damages on the part of the defendant, in case the plaintiff should be removed after an agreement of the character alleged, was calculated to be a strong incentive to the defendant to act contrary to the true interests of the company and of its other stockholders. Bliss v. Matteson, 45 N.Y. 22; 1 Mor. Priv. Corp. §§ 516, 519.'         Secondly, as respects Fritsch's claim under his agreement with Lehigh, the Referee disallowed this claim also, but not on the ground that it was 'necessarily void, either for illegality or because ultra vires,' as the trustee maintained, but because it was voidable, and had been legally voided by operation of law under Section 70, sub. b, of the Bankruptcy Act when the Referee failed within the prescribed sixty day period either to assume or reject it.

The note in question is invalid, for the reason that one acting in a fiduciary capacity cannot take any advantage personal to himself from his administration of the subject of the trust. (Civ. Code, secs. 2230, 2234; Farmers' etc. Co. v. San Diego etc. Co., 45 Fed. Rep. 527; Wickersham v. Crittenden, 93 Cal. 17; Ryan v.Leavenworth etc. Ry. Co., 21 Kan. 397, 398; Wilbur v. Lynde, 49 Cal. 292; Goodin v. Cincinnati, etc. CanalCo., 10 Ohio St. 183; Flint etc. Ry. Co.v. Dewey, 14 Mich. 488; Corbett v. Woodward, 5 Saw. 404; Bliss v. Matteson, 45 N.Y. 26; Abbott v. American Hard Rubber So., 33 Barb. 578; Morawetz on Private Corporations, secs. 517, 518.) 19 Am. Rep. 645.

Like all other persons where this relation exists, he cannot, as buyer for his corporation, buy of himself against the objection of his cestui que trust, nor as seller for the corporation become the purchaser, nor, being its agent and trustee, contract with himself, or secure to himself advantages not common to other stockholders, because such contracts and relations are likely to bring him in conflict with his duty and self-interest, and tempt him to be unfaithful to the superior obligations he has assumed. Pierce R. R. 36; Mor. Corp., s. 245; Ang. A. Corp., .ss. 233, note a 312; Butts v. Wood, 37 N.Y. 317; Hoyle v. Railroad, 64 N.Y. 314, 328, Blake v. Railroad, 56 N.Y. 486, 190; Barnes v. Brown, 80 N.Y 527, 535; Duncomb v. Railroad, 84 N.Y. 190, 198; Robinson v. Smith, 3 Paige 222, 232; Koehler v. Company, 2 Black 715, 721, Bliss v. Matteson, 45 N.Y. 22; 1 Per. Tr., s. 207; Booth v. Robinson, 55 Md. 419, 436, 440. The plaintiff is a stockholder in the Concord, and sustains to the directors of the company the relation of a cestui que trust.

Such an agreement is against public policy, and renders the note void. (Bliss v. Matteson, 45 N.Y. 22; S.C. 52 Barb. 335; Devlin v. Brady, 36 N.Y. 531; S.C. 32 Barb. 518; Davison v. Seymour, 1 Bosw. 88; Meacham v. Dow, 32 Vt. 721; Ferris v. Adams, 23 Id. 136; Fuller v. Dame, 18 Pick. 472; Gray v. Hook, 4 Comst. 442; Satterlee v. Jones, 3 Duer, 103; Marshall v. Ohio R. R. Co. 16 How. 314; 1 Redfield on Railways, 5th ed. § 140, and notes; Story on Bills, § 186.

A board of directors cannot make a contract with one of their number, or with a copartnership in which one of their number is interested, that will bind the corporation. Railway Co. v. Poor, 39 Me. 277; Coal Co. v. Sherman, 30 Barb. 563; Ogden v. Murray, 39 N.Y. 202; Bliss v. Matteson, 45 Barb. 22; Imperial Mercantile Credit Association v. Coleman, L. R. 6, ch. 558. The cestui que trust alone may repudiate the trade and take its gains.

The cases relied upon for an affirmance of the judgment do not support respondent's contention. The case of Bliss v. Matteson, 52 Barb. (N.Y.) 348, involved the validity of an agreement to control the action of the directors of a corporation in voting to pay plaintiff's claim irrespective of its legality. It was there held that an arrangement which is designed or which in its nature or effect tends to lead persons charged with the performance of trusts or duties for the benefit of others to violate or betray them is contrary to public policy.

During that time plaintiff and both defendants were directors. As such they were her trustees in duty bound to cast their votes in the board of directors on the questions of the election of officers and fixing of salaries according to the true interests of the company. Any contract on their part to do otherwise, or by which if they voted to reduce the salary of one of the company's officers they would incur a liability to purchase his shares would be dishonest, illegal and void. ( West v. Camden, 135 U.S. 507; Wilbur v. Stoepel, 82 Mich. 344; Cone v. Russell Mason, 48 N.J. Eq. 208; Guernsey v. Cook, 120 Mass. 501; Bliss v. Matteson, 45 N.Y. 22; Timme v. Kopmeier, 162 Wis. 571; Morawetz Priv. Corp. [2d ed.] § 519.) Since the contract as to these matters would have been void in its inception had there been stockholders who were not parties to it and since it would become void so far as unexecuted from the time persons not parties acquired shares of stock, I think we should assume that the parties did not intend the contract to remain in force after there were new stockholders who were not bound by it.