Trustees holding a dead man's bank shares for his daughters were made personally liable when the City of Glasgow Bank failed

John Murdoch died in 1873 holding £6,000 of City of Glasgow Bank stock. His daughters, Mary Syme and Sophia Boyd, assigned his estate to four trustees by a deed of 20 September 1873: William Muir, William Thompson, John Boyd and James Laurence Boyd. The bank's ledger entered them as "trust-disponees" of the two women. The bank's shareholders had unlimited liability for its debts. On 2 October 1878 the bank closed. Its managers had hidden losses in false accounts, and its net liabilities exceeded £6 million. Liquidators called £500 per share in November 1878 and £2,250 more in April 1879, a total of £2,750 on every £100 share. Only a third of shareholders could meet the first call in full. The trustees argued they held the stock only for Murdoch's estate. On 7 April 1879 the House of Lords held that they were partners in their own right and personally liable to pay. The general manager, Robert Stronach, and the director Lewis Potter got 18 months in prison; five other directors got eight months. A national relief fund raised £379,670 by 1882. The Companies Act 1879 capped bank shareholders' liability under a new "reserve liability" rule and required bank audits. The Hunterian in Glasgow holds five of the bank's notes.