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ANNUAL REPORT
OP THE
COMPTROLLER OF THE CURRENCY
TO THE
SECOND SESSION OF THE FIFTY-FIFTH CONGRESS
OF
THE UNITED STATES.
DECEMBER 6, 1897.
TWO VOLUMES.
V O L U M E I.
WASHINGTON":
GOVERNMENT PRINTING OFFICE.
1897.
TREASURY DEPARTMENT .
Document No. 1986A.
Vol. I,
Comptroller of the Currency*
CONTENTS.
Page.
History of legislation constituting the national-bank act
IX- XVI
Bank-note circulation
XVI
German Imperial Bank
XVII
Organization, extension, and liquidation of national banks
XIX
Geographical distribution of national-bank stock
XIX
Paid-in capital stock of national banks in each State
XIX
Number and capital of national banks organized during the year
XX
Extension of corporate existence of national banks during the year
XX
Extension of corporate existence of national banks under the act of July 12,1882
XX
Expirations of corporate existence of national banks during the year ending on October
31,1898
XX
Expirations of corporate existence of national banks annually from 1898 to 1997
XX
Number, capital, and circulation of national banks leaving the system during the year by
voluntary liquidation
XX
Changes in the principal items of resources and liabilities of national banks from 1863 to
1897
,
XXI
Analysis of national-bank reports made duriitg the year ended on October 5,1897
XXIII
Receiverships, condition of
XXV
Dividends paid to creditors of insolvent national banks during the past and prior years.. XXVI
Titles, assets, and liabilities of national banks placed in charge of receivers during the
year
XXVII
Number, assets, and liabilities, by States, of national banks placed in charge of receivers
during the year
XXVIII
Number, capital, circulation, claims proved, and dividends paid by insolvent national banks
annually from 1865 to 1897
.".
XXVIII
Distribution of national-bank stock
XXIX
Women shareholders in national banks
XXIX
Distribution of national-bank stock in 1876,1836 to 1839, inclusive, and 1897
XXX
Foreign holdings of national-bank stock...
XXXI
Women employees of national banks
XXXI
Earnings and dividends of national banks
XXXI
Taxes paid to the General Government, on circulation, capital, and deposits, by national
banks
XXXII
State banks and banking institutions
XXXII
State banks and banking institutions, condition of, from 1893 to 1897
XXXIV
Amount and average rate per cent of dividends paid by State banks
XXXIV
Savings banks, condition of
XXXIV
Number of depositors and interest paid thereto by savings banks
XXXV
Cost of management of savings banks in Maine and Massachusetts
XXX VI
Classification of deposits in savings banks in Maine and Connecticut
XXXVI
Stock savings banks, condition of
XXXVI
Loan and trust companies, condition of
XXXVI
Private banks and bankers, condition of
XXXVII
Principal items of resources and liabilities of State banks, banking institutions, and national
banks
XXXVII
Capital of national and other reporting banks in 1897 and averages per capita of population
in 1893 to 1897
XXXVII
Aggregate banking funds of national and other banks in each State
XXXVIII
Average per capita, by States, of banking funds
XXXVIII
Average population of States per square mile
XXXVIII
Coin and other currency held by national and State banks
XXXIX
Existing banks and bank failures
XXXIX
Canadian chartered banks, condition of
XXXIX
III
IV
CONTENTS.
Page.
Building and loan associations, assets and liabilities of, in 1893,1895-96
XXXIX
Postal savings banks
XLI
Establishing act, history of, and statistics relative to postal savings banks in the United
Kingdom
XLI
France, postal savings banks in
LIV
Italy, postal savings banks in
LIY
Austria-Hungary, postal savings banks in
-„ LIV
Act establishing postal savings banks in the Austro-Hungarian Empire
LIV
Regulations governing the Austro-Hungarian postal savings banks
LVII
Practical uses of savings banks in Austria-Hungary
LVIII
Operations of the check or banking department of the Austro-Hungarian postal savings
banks
LX
Netherlands, postal savings banks in
LXI
Belgium, postal savings banks in
»
LXI
Sweden, postal savings banks in
LXII
Canada, postal savings banks in
LXII
Australasia, postal savings banks in
LXIV
India, postal savings banks in
LXIV
Cape Colony, postal savings banks in
LXIV
Postal savings banks returns
LXIV
Wolff, Mr. H. W., description and statistics relative to savings banks, by
LXV
Comparative statement of number of depositors, and amount of deposits in savings banks
of the world
LXV
Depositors, aggregate deposits, and average deposit in savings banks, percentage of depositors to population, and deposit per inhabitant in the principal countries of the world in
1895
LXVI
World's banking power
LXVI
Mulhall, Mr. M. G-., statistics by, relative to the world's banking power
LXVI
Resources and liabilities of foreign commercial banks and banks of issue
LXVII
Interest paid on deposits and rates charged on loans and discounts by banks in the principal countries of the world
LXVII
United Kingdom, banking returns from
LXVIII
Resources and liabilities of joint-stock and private banks of the United Kingdom in June
and December, 1896, and June, 1897
>
LXX
Foreign banks of issue
LXXII
Specie, circulation, percentage of specie to circulation, current accounts and deposits, and
loans and discounts of the principal European banks of issue
LXXII
Director of the Mint, statistics compiled by, relative to the monetary systems, and the
world's stock of money
LXXII
Monetary systems and stock of money in the principal countries of the world in 1897... LXXIII
Digest of national-bank decisions, reference to
LXXIV
Appendix and Vol. II, reference to
LXXIV
Examiners, recommendation relative to change in method of paying
LXXV
Conclusion
„'
LXXV
CONTENTS OF APPENDIX.
Diagram. (Follows page LXXV.)
National-bank act
pigest of national-bank decisions
Correspondence relative to foreign banks and banking
1
85
313
APPENDIX TABLES.
No. 1. Salaries and personnel of the Bureau
No. 2. Expenses of the Bureau
..
No. 3. Number of national banks organized, in operation, and number passed out of the
system since 1863
No. 4. Number and capital of national banks organized, in liquidation, insolvent, and
yearly increase or decrease, annually, 1863 to 1897
No. 5. Number of national banks organized, in liquidation, and number, capital, bonds,
and circulation of associations in operation October 31,1897
329
330
330
331
333
CONTENTS.
V
Page.
No. 6. Number of national banks organized, in voluntary liquidation, insolvent, and num
ber and capital of banks in operation on J a n u a r y 1, from 1864 to 1897
333
No. 7. Number of national banks in operation on October 31,1897, in liquidation, and insol
vent, in each State and Territory since the organization of t h e system
333
No. 8. Number and capital of national banks organized in each State during the past year. 334
No. 9. Number of national banks in operation and classification of their capital stock in
each State and geographical division, October 31,1897
334
No. 10. Summary of national banks in operation, with classification of their capital stock in
each State and geographical division, October 31,1897
340
No. 11. N u m b e r and capital of all national banks in each State extended under the act of
July 12,1882
342
No. 12. Number, capital, and circulation of banks extended in each State during the year. 342
No. 13. National banks, their capital and circulation, t h e corporate existence of which
expired during t h e year, and associations which succeeded them
342
No. 14. Capital, bonds, and circulation of associations the corporate existence of which will
expire during the year ending October 31,1898
343
No. 15. National banks the corporate existence of which will expire during the period of
ten years, from 1898 to 1907 inclusive.
343
No. 16. National banks closed to business by voluntary liquidation or otherwise during t h e
year
344
No. 17. National banks closed during t h e year and in charge of examiners
346
No. 18. Distribution, by States, of shares of stock in national banks
347
No. 19. Women shareholders and women employed by national banks
,350
No. 20. A u t h o r i z e d capital stock of national b a n k s on t h e first of each m o n t h from J a n u a r y
1,1875, t o N o v e m b e r 1,1897, b o n d s deposited, circulation secured b y bonds, l a w f u l
money on deposit, and circulation o u t s t a n d i n g , .
352
No. 21. Profit on circulating notes on October 31, during t h e past four years
357
No. 22. Changes in capital, bonds, and circulation, by States and geographical divisions
358
No. 23. Decrease or increase of national-bank circulation on October 31.1889, to October 31,
1897
383
No. 24. Circulation issued, lawful money deposited to retire circulation, from J u n e 20,1874,
to October 31,1897, by States
...
364
No. 25. Circulation outstanding, lawful money on deposit to redeem circulation, and bonds
deposited to secure circulation, on October 31,1896, and October 30,1897
365
No. 26. Quarterly increase or decrease of circulating notes from J a n u a r y 14,1875, to October 31,1897
366
No. 27. Amount, by denominations, of circulation issued, redeemed, and .outstanding on
October 31, from 1864 to 1897
. 366
No. 28. National gold bank notes issued and outstanding October 31,1897
371
JSTo. 29. National-bank notes issued during the year and the total amount issued, redeemed,
and outstanding
371
No. 30. Additional circulation issued monthly on bonds, 1885 to 1897
371
No. 31. Number and denominations of national-bank notes issued since t h e organization of
t h e system
372
No. 32. Vault account of national-bank notes received and issued during the year
372
No. 33. National banks which had no circulation outstanding on October 31, 1897
372
No. 34. "Additional circulation'' issue:1 and retired by States during t h e year
373
No. 35. Monthly redemptions of national-bank notes during the year
374
No. 36. National-bank notes destroyed yearly since establishment of t h e system
374
No. 37. Vault account of rational-bank notes received and destroyed during the year
375
No. 38. Taxes assessed as semiannual d u t y on circulation, deposits, and capital, 1864 to 1882. 375
No. 39. Taxes assessed as semiannual duty on circulating notes, cost of redemption, etc.,
1883 to 1897....
375
No. 40. Taxes collected on capital, deposits, and circulation t o J u n e 30,1897
375
No. 41. Taxes collected on circulation, deposits, and capital of banks other than national.. 376
No. 42. Specie and bank-note circulation of the United States from 1800 to 1859
376
No. 43. Coin and paper circulation of the United States from 1860 to 1897
377
No. 44. Bonds deposited as security for circulation and held for other purposes by national
banks on J u n e 30, from 1865 to 1897
378
No. 45. Bonds deposited as security for circulation and amount held for other purposes by
national banks on October 31,1882, to 1897
379
No. 46. Interest-bearing bonded debt of the United States from 1865 to 1897
380
No. 47. Opening, highest, and lowest m a r k e t prices of United States bonds during t h e y e a r . 381
No. 48. Investment value of United States bonds, 1886 to 1897
383
No. 49. Number of national banks in each State, etc., capital, bonds held and required
384
VI
CONTENTS.
No. 50. Number of national banks in each State, etc., with capital of $150,000 and under,
1896 and 1897
•
No, 51. Number of national banks in each State, etc., with capital exceeding $150,000,1896
and 1897.
No. 52. Comparative statement of resources and liabilities of national banks from 1864 to
1897
No. 53. Abstract of reports of national banks in New York City, the central reserve cities,
etc., on October 5,1897
No. 54. Highest and lowest points reached in the principal items of the resources and
liabilities of the national banks during the existence of the system
No. 55. Percentages of loans, United States bonds, and specie to the aggregate funds of the
national banks, 1866 and 1887 to 1897
No. 56. Classification of loans made by national banks on approximate dates, 1893 to 1897...
No. 57. Classification of loans by national banks in New York City in the last six years
No. 58. Classification of loans and discounts made by national banks in each reserve city,
State, and Territory, on October 5,1897
No. 59. Loans and discounts, capital stock, surplus and other undivided profits, and circulation of national banks on October 5,1897
No. 60. Specie and circulation of national banks, year ended October 5,1897
_
No. 61. Lawful money held by national banks at date of each report from January £0,1877,
to October 5,1897
No. 62. Specie held by national banks in New York City at date of each report from February 28,1890, to October 5,1897
No. 63. Deposits and classification of reserve held by national banks on or about October 2,
1874, to October 5,1897
No. 64. Lawful money held by national banks in each State, etc., during year
No. 65. Deposits and reserve required and held by national banks at date of each report
from December 17,1896, to October 5,1897
No. 66. Net deposits and reserve required and held by national banks on three dates in the
past six years
_
No. 67. Net deposits and reserve required and hold by national banks at date of each
report from September 25,1891, to October 5,1897
No. 68. Weekly deposits, circulation, and reserve of the national banks in New York City,
1891 to 1897
No. 60. Classification of the reserve held by national banks in New York City during October for the past sixteen years
No. 70. Earnings and dividends of national banks, by States, etc , from September 1,1896,
to September 1,1897
No. 71. Ratios to capital, and to capital and surplus, of the earnings and dividends of
national banks, by States, etc., March 1,1893, to September 1,1897
No. 72. Capital, surplus, dividends, and net earnings of national banks annually from 1870
to 1897
Nos. 73, 74, 75, 76. National banks, dates of liquidation, capital, circulation issued, retired,
and outstanding, which have gone into voluntary liquidation under the
various provisions of the Revised Statutes
No. 77. National banks which have been placed in the hands of receivers, capital and surplus at date of organization and at date of failure, cause of failure, dividends
paid while solvent, circulation issued, lawful money deposited to redeem circulation, the amount redeemed and the amount outstanding on October 31,1897
No. 78. Insolvent national banks, dates of organization, appointment of receiver, and ciosing, nominal and additional assets, collections from all sources, loans paid and
other disbursements, loss on assets, expenses of receivership, claims proved,
dividends pajd, and assets returned to stockholders
No. 79. National banks which failed during the year, with their capital, surplus, and other
liabilities
No. 80. National-bank receiverships in an inactive condition
No. 81. Insolvent national banks the affairs of which were closed during the year
No. 82. Dividends paid to creditors of insolvent national banks during the year, etc
No. 83. Insolvent national banks with capital of $50,000 or less the affairs of which have
been closed
No. 84. Insolvent national banks with capital of over $59,030, etc., the affairs of which have
been closed
No. 85. Insolvent national banks with capital of over $103,000, etc., the affairs of which have
been closed
No. 86. Insolvent national banks with capital of over $200,000, etc., the affairs of which have
been closed
386
387
388
391
392
393
392
394
395
395
398
418
422
42i
428
446
447
450
452
453
454
462
434
465
486
506
532
534
535
536
541
543
545
547
CONTENTS.
No. 87. Insolvent national banks with capital of over $500,000 the affairs of which have been
closed
No. 88. Recapitulation of claims proved, dividends paid, losses, etc., of insolvent national
banks, the affairs of which have been closed, to October 31,1895 1
No. 89. Transactions of the New York Clearing House for the years ended on October 1,
1898 and 1897
.
."
No. 90. Transactions of the New York Clearing House for 44 years
No. 91. Clearing-house transactions of the assistant treasurer, United States, New York,
for the year ended October 1,1897
No. 92. Exchanges of the clearing houses of the United States for the month of October,
1897 and 1896
!
No. 93. Exchanges of the clearing houses of the United States for thewveeks ended October
30,1897, and October 31,1896
No. 94. Exchanges of the clearing houses of the United States for the years ended September 30,1897 and 1898
Abstract of reports of condition of the State banks, loan and trust companies, savings and
private banks, 1896-97
,
Number, assets, and liabilities of banks other than national which failed during the year
in each State
Abstract of resources and liabilities of the loan and trust companies in the District of
Columbia on October 5,1897
."
Summary of the condition of the Canadian banks on September 30,1897
Savings-bank returns of the principal countries of the world
Resources and liabilities of foreign banks of issue, etc
Aggregate resources of national and other banks, building and loan associations, by States
and geographical divisions
Aggregate resources and liabilities of the national banks from October, 1863, to October, 1896.
Abstracts of the reports of national banks at date of each call since October 6,1898, arranged
by States and Territories and reserve cities
Important items of resources and liabilities of national banks in each State in October, 1863
to 1897
Index to the text of the report...
Index to the Appendix
VII
548
549
550
553
550
551
552
553
555
534
585
5S6
5S7
591
596
597
623
759
785
"PI
REPORT
THE COMPTROLLER OF THE CURRENCY.
TREASURY DEPARTMENT,
OFFICE OF THE COMPTROLLER OF THE CURRENCY,
Washington, December 6, 1897.
SIR : I beg leave to herewith submit for the consideration of Congress
the annual report of the Comptroller of the Currency for the year ended
October 31, 1897.
In view of the interest attaching to that which is termed the banking and currency question, I have deemed it best to briefly review the
history of the legislation which, taken as a whole, constitutes the present national-bank act. In previous reports to Congress amendments
to the act have been suggested, many of which remain as yet unconsidered and unacted upon. To such as I have heretofore made, in many
cases being but a repetition of those suggested by my predecessors in
office, I again respectfully call attention without specifically repeating
them.
The national currency act, which became a law February 25,1863,
was in its original form unsymmetrical in arrangement, inconsistent iti
many of its provisions, obscure in certain others, and in consequence
very difficult of construction. It at once became apparent that a law
of such far-reaching importance to the financial progress of the country,
and which daily was to be interpreted by people of widely different
scholastic and business training, should be couched in clear and precise
language, entirely consistent in all its provisions, and methodically and
logically arranged., In consequence not a few of the provisions in the
original currency act of 1803 at once became subject to criticism by
those charged with the supervision and control of the banks organized
in pursuance of the law.
The first to be criticised was section 13, which had reference to the
increase of the capital stock of a national bank. That section, as originally passed, provided for an increase, by a vote of the shareholders,
from time to time, of such capital stock, subject to the limitations
of the act. It was at once discovered that as a matter of fact there
was no limitation of any kind or nature embodied in the original act
fixing the amount to which the capital could be increased. The same
section provided that no increase of the capital would be valid until it
was all paid in and the Comptroller of the Currency so notified, arid
his certificate obtained specifying the amount of the increase and that
the amount had been duly paid to the association. That which should
have been enacted, and which was years afterward, was the grant of
power to the banks to increase their capital stock, such increase to be
X
REPORT OF THE COMPTROLLER OF THE CURRENCY.
approved by the Comptroller of the Currency, and his certificate certifying* to the increase issued when he was assured of the payment in full.
Section 15 of the act was inconsistent with section 30, in that the former
required that every association before the commencement of the business of banking should deposit with the Treasurer of the United States
interest-bearing bonds to an amount not less than one-third of the paidup capital stock, while the latter provided, among other things, that the
Comptroller of the Currency "may direct the return of any of said
bonds" to the depositing association upon cancellation of a proportionate amount of the circulating notes of the bank, which pro vision construed by itself might have entirely defeated, or partially nullified, the
provisions of section 15.
Section 37 was intended to prohibit the making of loans or discounts
by an association on the security of its own shares of stock, and to prohibit general stock speculation, but the section was so inartificially
drawn that a literal construction, might prevent banks from loaning
or discounting with stocks of other corporations as collateral security. Many other sections were criticised, some in part, others in toto.
Some were recommended to be stricken out entirely, others partially
amended. In the year following, on June 3,1864, the national currency
act was thoroughly revised and reenacted. This act was embodied in
the sixty-second title of the Eevised Statutes, which contained all the
national statutes which were in force December 1, 1873. On the 20th
of June, 1874, Congress declared that the act shall hereafter be known
as the national-bank act.
Acting on certain suggestions made by the first Comptroller of the
Currency, Congress remodeled the original law on the lines indicated,
making the act clear where it was obscure and definite where different
constructions Avere possible. In its amended form it received Executive approval on the 3d day of June, 1804, and, as then revised, the
act constitutes in the largest measure the law governing the nationalIran king system to-day.
The revised act was still found to be defective in many of its important features, and the then Comptroller urged upon Congress the necessity of passing acts amendatory thereof. In the law of June 3, 1864,
no provision was made for the appointment of a receiver by the Comptroller of the Currency whenever he was possessed of satisfactory
evidence that a particular association was not carrying on the proper
and legitimate business for which it was organized, .that it was making
reports required by law in a false and fraudulent manner, willfully misapplying the funds of the association, or committing overt acts of
insolvency.
The same report recommended an amendment to section 29 of the
bank act extending the provisions contained therein so that the limitation to one tenth of the capital would apply to all liabilities for money
loaned or deposited, except balances due from one national-banking
association to another. Still other amendments of more or less importance were suggested, viz, to section 38, providing for a reduction in
the capital stock of the association to meet impairment; to section 34,
relative to doing away with quarterly statements at stated intervals,
and to section 59, regarding penal offenses and counterfeiting.
All of these recommendations failed to receive action at the hands of
Congress, and the law remained as it was, notwithstanding the forceful reasons presented in their favor. The only amendment passed by
Congress in 1865 was the one amending section 21 of the law of 1861 in
reference to the amount of circulating notes which a bank was entitled
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XI
to receive, in what ratio to the bonds deposited, and in what ratio to
the capital of the association.
In 1867 the Comptroller recommended but a single amendment, and
that was a reiteration of one of the principal amendments urged in the
report of the year previous. Under the existing law at that time banks
were required to make detailed statements of their affairs at the beginning of each quarter, together with a statement showing the average
circulation, deposits, lawful money, and balances available for the
redemption of their circulating notes at the beginning of each month.
The monthly statement required was more or less vague, and so general
that it failed to give anything like correct or reliable information as to
the actual condition of the bank, and in lieu of the report so required
a statement exhibiting in detail the affairs of each bank on the first
Monday of each month was suggested.
Congress failing to act upon this recommendation, it was repeated
in the report of 18G8, with an exceedingly strong statement of reasons
for better legislation on the subject. The law as originally passed
required every national banking association to make a report exhibiting in detail its resources and liabilities on the first Monday of January, April, July, and October of each year, and in addition a report on
the first Tuesday of each month showing the average amount of loans
and discounts, deposits, and circulation. The argument against the
policy of this law, repeatedly made to Congress by those intrusted with
its administration, was that these quarterly reports came upon certain
specified days, known in advance to all, and because of this if a bank
cared to make any preparation or change in its affairs so as to exhibit
a different condition from that actually existing it had time and ample
notice to do so.
Another argument presented on the subject was that the law as it
stood was a menace to business, and operated harshly against those
associations which would not resort to unfair statements of any kind in
making reports. It was well known to gold and stock speculators that
on a day certain the national banks would strive to have in their vaults
the required amount of lawful money, and taking advantage of this
necessity combinations were organized with the sole object of creating
a stringent money market, and thereby forcing a depression of the price
of securities. Besides a forced depression in the value of securities,
commercial transactions were hampered through the rates of interest
prevailing, caused by this artificially created stringency in the money
market. A state of affairs such as this, which had before been twice
fully laid before Congress, called for a remedy both prompt and complete in the interest of all commercial transactions, and as a matter of
fairness to honest methods of banking.
The amendment to the law suggested was that section 34 of the act
of June 3, 18G4, be amended so as to authorize the Comptroller of the
Currency to call upon the banks for five detailed statements or reports
during each year, fixing*upon some past day to such call for the date
of the report. This method would ascertain the condition of the bankvS
at irregular intervals, for which preparation could not be made, and
would prevent currency speculators from knowing when to blackmail the
legitimate trade of the country. On March 3, 1869, after five years of
urgent solicitation, a law was passed by Congress embodying the recommendation relative to reports, and the amended faw as passed in
1869 is the law to-day.
Another defect in the original bank act was the provision relating to
associations in voluntary liquidation. Section 42 of the currency act
XII
REPORT OF THE COMPTROLLER OF THE CURRENCY.
provided that any association might go into liquidation, and be closed
by a vote of shareholders owning two-thirds of the stock; and at any
time after the expiration of one year from the time of publishing the
notice of the liquidation, the association was required to pay to the
Treasurer of the United States the amount of lawful money required to
redeem its outstanding notes, and take u\) the bonds on deposit with
the Treasurer as security for its circulating notes. Under that law
there was no reason why a bank could not vote to go into voluntary
liquidation, pay off all existing liabilities, and do no business of any
kind, and yet reap the benefit of its circulation.
A remedy for this was suggested to Congress in 1868 and urged
with added vigor in 1869. It required banks going into voluntary
liquidation to provide for their outstanding circulation by a deposit of
lawful money with the Treasurer of the United States within three or
six months after going into liquidation. Upon July 14,1870, the provision which has remained unchanged, requiring all banks liquidating after
that date to deposit lawful money to retire the outstanding circulation
within six months from the date of the vote to go into liquidation, in
default of which authority was given to the Comptroller to sell the
bonds pledged for the circulation of the banks for the redemption and
cancellation of the circulation, was enacted into law.
A further examination of the course of bank legislation during this
period develops that laws of more or less imxx>rtance were enacted. On
March 2, 1867, an act to provide ways and means for the payment of
compound-interest notes was passed, which authorized the Secretary of
the Treasury to issue temporary interest-bearing loan certificates payable on demand in lawful money, said certificates to be allowed to
be held by national banks as part of the reserve required by law.
This law was supplemented by another act, approved July 25,1868, j)roviding for a further issue of temporary loan certificates for the purpose
of redeeming and retiring the remaiuder of the outstanding compoundinterest notes. Section 2 of the act approved March 26, 1867, entitled
"An act to exempt wrapping paper macle from wood or cornstalks from
internal tax, and for other purposes," provided for a 10 per cent tax to
be paid by banks upon the notes of any town, city, or municipal corporation paid out by them after the 1st of May, 1867.
The law of 1864, section 41, relating to State taxation, provided that
the shares of a national banking association should be included in the
valuation of the personal property of a person or corporation at the
place where such bank is located, and not elsewhere; but this seemingly
explicit statement of where the shares were to be taxed became so much
the subject of almost endless litigation that an act approved February,
10, 186S, provided that "the place where the bank is located, and not
elsewhere," shall be construed to mean the State within which the bank
is located, and, also, that the shares of any national bank owned by
nonresidents of any State shall be taxed in the city or town where said
bank is located.
Early in the history of the national currency act it was demonstrated
that a prohibition would be necessary against the practice of loaning
money upon United States notes, and on February 19, 1869, an act was
passed to the effect that no national bank should thereafter offer or
receive United States notes or national bank notes as security for any
loan of money or for a consideration agree to withhold the same from
use, nor offer or receive the same as collateral security, and a violation of this law was a misdemeanor which carried a heavy fine. In the
same year two additional acts to prevent unlawful practices were passed,
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XIII
one making it unlawful for any officer of a national bank to certify a
check drawn upon it unless the person or company drawing said check
had on deposit at the time an amount of money equal to the amount
specified in the check, and providing for the appointment of a receiver
by the Comptroller for any certifications contrary to the restrictions
imposed, and the other made it a crime punishable by imprisonment and
fine for any person aiding or abetting with intent to defraud or deceive
any officer or agent of any association in doing any of the acts enumerated in the fifty-fifth section of the law of June 3, 1864.
Another amendment of importance to the act was approved July 12,
1870. It purported to provide merely for the redemption of the 3 per
cent temporary loan certificates and for an increase of national-bank
notes, but that title gave a very inadequate idea of its scope and effect.
It did provide for an additional circulation of $54,000,000, to be distributed pro rata among the States and Territories according to the
census of 1870. The really important feature of the statute was the
establishment by section 3 thereof of national banks authorized to
issue circulation, redeemable in gold coin, to 80 per cent of the par
value of the bonds deposited.
The United States bonds required to be deposited as security for
this circulation were those bearing interest payable in gold only, and
the associations organized under this statute were subject to all the
requirements and provisions of the national currency act, with a few
minor exceptions, chief among which was the privilege granted to any
one association of issuing circulation to $1,000,000, while section 1 of
the same act limited the amount of the circulation to other banking*
associations organized after 1870 to $500,000.
Within the period embraced between 1864 and 1872, the internal-revenue laws of the country enacted during that time contained provisions
of much importance to national banks on the subject of taxation.
Under title of an amendatory act to the act passed in 1864 to provide
internal revenue to support the Government, to pay interest on the public
debt, and for other purposes, permission was given in 1865 to State
banks to convert to the national system, and where such State banks
had branches, to retain and keep in operation such branches after conversion.
The great defect in the law as it existed in 1870 was that no provision
was made whereby a bank whose capital stock had become seriously
impaired by losses or otherwise could be forced to make good its
impaired capital within a reasonable time, or finally wound up by a
receivership or voluntary liquidation. The only aid which the Comptroller could invoke in cases where the capital of a bank was impaired
was to prohibit it from declaring any dividends during the period of
impairment. This was wholly inadequate to reach the necessities of
the cavse, and was entirely ineffective, because it permitted the carrying
on of business by unsound institutions, whose usefulness was seriously
crippled or possibly entirely destroyed. The remedy suggested to
Congress was that a bank with impaired capital be required forthwith
to make good the impairment by an assessment on its shareholders, and
if the capital was not promptly restored the affairs of the bank should
be placed in the hands of a receiver. This recommendation was renewed
annually until 1873, when the act of March 3 of that year, now section
5205 of the Eevised Statutes, was passed, giving authority to the
Comptroller to appoint a receiver for any national bank which did not
restore its impaired capital within three months after receiving notice
of such impairment, or go into liquidation.
XIV
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Congress in 1S73 bad before the proper committees bills embodying
amendments to the act, providing for bank consolidations, denning definitely the duties of receivers of such as were insolvent, and for other
changes, but no action was taken on them. In 1874, however, legislation of importance was enacted, the principal features of which were
the abolishment of lawful-money reserve on circulation except as to
national gold banks, and the establishment of a redemption fund Avith
the Treasurer of the United States.
By this act also were abolished redemption agencies in cities, and
banks were permitted to withdraw bonds deposited in proportion to
amount of circulation retired. In 1875 a law repealing the provisions
limiting the aggregate amount of circulating notes, and also the provisions for the withdrawal of currency, went into effect. The same
year the law limiting the circulation of banking associations organized
for the purpose of issuing notes payable in gold, severally to $1,000,000,
was also repealed.
In the year 1876 the national-bank act was again materially amended.
This law provided, in section 1, for the appointment of receivers for
any violation of law, or neglect of any association to pay any judgment
obtained against it, or in case of insolvency. The second section of
this act is to the effect that when any association goes into liquidation
the individual liability of the shareholders may be enforced by any
creditor by a bill in equity, in the nature of a creditors' bill, brought
by such creditor on behalf of himself and of all other creditors of the
association, against the shareholders thereof, in any court of the United
States having original jurisdiction in. equity for the district in which
such association may be located. Section 3 of this act, amended by
the law of August 3, 1892, has special reference to the election of an
agent to manage the affairs of an association after the payment in full
of every creditor thereof, not including shareholders who are creditors,
together with the expenses of the receivership. The manner in which
the meeting of shareholders shall be called is fully explained, and the
powers and duties of the agent enumerated.
In the same act it is made incumbent ux)011 a ^ savings banks or savings and trust companies organized under authority of any act of
Congress to report to the Comptroller of the Currency, and all savings
or other banks then or subsequently organized in the District of
Columbia were subjected to all provisions of the Revised Statutes, and
of all acts of Congress applicable to national banking associations.
From 1870 to 18S1 there was comparatively little banking legislation,
and few recommendations were made to Congress by the Comptroller
of the Currency. In 1882, however, was passed an actto enablenational
banking associations to extend their corporate existence for an additional period of twenty years, by an amendment to the articles of association of the bank.
The amendment was to be authorized by the consent in writing of
stockholders owning two-thirds of the stock, upon which the certificate
of the Comptroller approving the extension would issue. All the
rights, privileges, immunities, liabilities, and restrictions of extended
associations were continued exactly as they existed before the extension of its period of succession. The statute providing for the extension of the corporate existence of national banks is to be accounted the
most important law referring to the national system of banking enacted
since 1864.
After specifying how shareholders not assenting to the extension
shall proceed; for the redemption of the circulating notes of extended
REPORT OP THE COMPTROLLER OP THE CURRENCY.
XV
associations at the Treasury) for the deposit of lawful money for such
redemption within three years from the date of extension, and for various other things, Congress, after ten years of continued and repeated
recommendations for legislation against the constant and flagrant abuse
of certification of checks drawn against fictitious balances, by section
13 of this act, made it a misdemeanor punishable by a line aud imprisonment for any officer, clerk, or agent of any national banking association who shall certify checks before the amount thereof shall have been
properly entered to the credit of the drawer upon the books of the bank.
In the year succeeding (1883), as a part of the general statute
reducing internal-revenue taxation, the tax on capital and on deposit
of banks was repealed.
Thus far no provision had been made in the law enabling national
banking associations to increase their stock, nor for a change of title
or location, but by section 1 of the act of May, 1836, a national bank
could, with the approval of the Comptroller of the Currency, by a vote
of the shareholders owning two-thirds of the stock, increase its capital
to any sum approved by the Comptroller, notwithstanding the limits
fixed in the original articles of association. It also made it possible
for banks to change their name and location without the necessity of
a special act of Congress by complying with certain formalities set out
in section 2, and by section 3 it was expressly stipulated that all the
debts, liabilities, rights, provisions, and powers of the banks under
the old name shall devolve upon and inure to the association under
the new name.
The law of 187G authorizing the appointment of receivers of national
banks made no provision for the termination or continuation of a
receivership after the creditors had been paid in full. In 181)2, legislation to that end was passed, and on August 3,1892, an act was approved
which has materially changed the manner of caring for the affairs of
insolvent banks after satisfying in full the demands of all creditors.
Under existing law, when a receiver has paid every creditor in full, not
including shareholders, and all the expenses of the receivership, and
the.circulating notes of the association have been redeemed, it is the
duty of the Comptroller of the Currency to call a meeting of the shareholders, and at such meeting the shareholders shall determine whether
the receiver shall be continued to wind up the affairs of the bank or
whether an agent shall be elected for that purpose.
In case an agent is determined upon, the person so elected shall execute and file a bond to the satisfaction of the Comptroller of the Currency conditioned for the faithful performance of the duties devolving
upon said agent, whereupon the Comptroller of the Currency and the
receiver shall transfer to the agent so elected all the remaining assets
of the trust, which shall be collected by the agent and distributed in
accordance with the specific directions contained in the law.
On July 28, 1892, an act was passed which by indirection changed
the law relative to the signing* of circulation. In sections 5172 and
5182 of the Kevised Statutes certain officers of the bank are designated
to sign its circulating notes, and no one else could sign for them, no
matter how great the inconvenience or emergency. But this law made
it obligatory upon every national bank to redeem all notes issued to or
received by it, even if such notes were lost by or stolen from the bank
and put in circulation without the signature or upon the forged signature of the president or vice-president and cashier.
Since the enactment of this la-w, however, while this office has not
sanctioned nor authorized any change regarding the signing of circu
XVI
REPORT OP THE COMPTROLLER OF THE CURRENCY.
lation as established in the original law, the rule indicated has not been
enforced, as the banks are now liable for the redemption of all notes
issued to them, whether signed or not.
All the law relating to the agent of shareholders will be found in
section 3 of the act of June 30,1876, as amended by the acts of August
3, 1892, and March 2, 1897. The original act of June 30, 1876, as
amended by that of August 3,1892, denned the rights and duties of
such agent in a most explicit and satisfactory manner, but was grossly
defective in the one great particular, that there was no provision of law
for any procedure in case the agent first elected should refuse to serve,
or die, resign, or be removed.
This amendatory law of March 2, 1897, remedied that defect, and
enacted that upon the happening of any one of the four enumerated
contingencies any shareholder may call a meeting of the shareholders
to elect another agent, who, when elected in accordance with the conditions stated, shall execute a bond to the shareholders for the faithful
performance of his duties.
BANK-NOTE CIRCULATION.
It is noticeable that in all the changes which have been wrought in
the national-currency act from its inception to the present time the
feature subject to criticism but which was intended should constitute
the principal benefit to be conferred has remained comparatively
unchanged, namely, the note-issuing function. Whatever justification
there was in the first instance for restricting the issuing of notes against
the bonds of the Government deposited with the Treasurer of the
United States to 90 per cent of the par value thereof, long since ceased.
In the report of every Comptroller of the Currency during the past
twenty years the wisdom of changing the existing law so that the
banks and through them the communities in which located might have
the additional benefit of an added loanable capital has been urged.
Despite all this the law still remains without amendment. Not only
should the bank act be amended in this particular, but Congress should
seriously consider such a change in the method of bank-note issues as
will enable the banks of the country to more adequately meet the
demands of trade and commerce in all sections of the country. The
business of banking, like every other form of investment, must be made
attractive to capital. If it is placed upon a footing different from
other undertakings, embarrassed through unnecessary restrictions, and
deprived of proper sources of profit, the result can not be otherwise
than that investible capital will seek other means of employment, and
to such extent deprive the people of the benefits of the agency most
requisite to commercial activity.
It is considered by every great commercial nation, except the United
States to be the sole province of the banks to issue the paper which
circulates as currency. The belief in a bank-note currency as being
better and safer than Government-paper currency prevailed almost
unquestioned in this country until, under the apparent exigencies of the
war, the Government undertook to issue paper currency. Even under
such circumstances the promise was always given, however, that it
should be retired at the earliest practicable moment and the admission freely made that it was neither a wise measure nor a safe form of
currency.
Between the competition of the Government note issues on the one
hand and the unnecessary restrictions imposed by law upon the other,
together with the increasing price of bonds required to be deposited as
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XVII
security, the note-issuing function of the banks has been permitted to
become merely an incident to the conduct of the national banking associations of the country. It has been seriously suggested more than
once that the bank-note issues be done away with and all paper be
issued by the Government instead. The danger of such a course is not
to be overestimated. The experience of every government has been
that governmental currency paper is a source of weakness and danger.
In the United States, where there has been the nearest approach to
success, but with the volume of the Federal paper comparatively limited
in amount, the credit of the Government has more than once been put in
jeopardy through it and the business interests of the country subjected
to unnecessary loss and confusion.
The argument that the Government, better than the banks, can provide for the redemption of paper-note issues will not stand the test of
a careful analysis. The Government has no means for caring for its
demand liabilities except through borrowing and through the levying
of taxes. Upon the other hand the banks have assets which can be
promptly converted into cash to meet their outstanding notes when presented. Their ability to command gold has always been beyond that
of the Government, for in each financial exigency which has confronted
the Government the banks have furnished to it the amounts necessary
to maintain its solvency. It is impossible to believe that with a system
of bank-note issues, based in part upon securities and in part upon
bank assets, the country can not be provided with a sound, safe, and
elastic bank-note issue, always commensurate with and responsive to
the demands of trade. The Bank of England, the Bank of Scotland,
and the Bank of Ireland have been found to be ample in their resources to provide the note issues for use in the trade of Great Britain*
The same is true of the Bank of France. The Deutsche Beichsbank,.
or German Imperial Bank, has for more than twenty two years issued
bank-note paper against assets which has maintained its value and
has been so controlled as to successfully meet the commercial needs
of the Empire.
It may be of value, in the light of a consideration which it is hoped
will be given to this whole subject, to call the attention of Congress
particularly to the Deutsche Eeichsbank, which was created in 1875,
as in its organization and conduct have entered elements of success
that justify the position taken by many thoughtful students of the
country's banking and currency needs, that the issuing of notes against
assets, regulated by a tax, is the only way that at all times and under
all circumstances the banks can be made to fulfill their proper function
in the business world.
By the terms of the statute of its creation that bank is subject to
Imperial supervision and direction. Its functions are to regulate the
money circulation within the jurisdiction of the German Empire, to
facilitate settlements and utilize available capital. The notes are
issued against its general assets, but are not legal tender, the Imperial decree stating that there shall be no obligation to accept bank
notes in case of those payments which are to be legally discharged in
coin. The fact, however, that the notes are not a legal tender has in
no way hindered or prevented their general circulation and they are
freely accepted both at home and abroad. At all times, however, the
bank is required to maintain a coin and bullion reserve amounting to
at least one-third of the notes in circulation.
The authorized circulation of the bank, without tax, was fixed arbitrarily, and this circulation required a reserve of one-third in cash or
its equivalent, and the other two-thirds may be covered by discounted
H. Doc. 10
II
XVIII REPORT OF THE COMPTROLLER OF THE CURRENCY.
bills not maturing later than three months from date, and protected
usually by three (never less than two) solid and accredited vouchers. All
notes issued beyond the limit so fixed were to be covered by a cash
reserve, but this restriction on note circulation having always been a
source of weakness to banks of issue because of inelasticity, the German Government, by the act of creation, provided that when the
Imperial Bank issued its uncovered notes in excess of the limit provided, a tax of 5 per cent per annum on such uncovered notes must be
X>aid. It was not until six years after the bank's creation that any notes
subject to this 5-per-cent tax were issued, and only on a few occasions
has the German Imperial Bank been obliged to issue its uncovered notes
subject to this tax.
The latest returns obtainable for the whole year of the outstanding
note circulation of the German Imperial Bank show that during the
year 1896 the lowest amount was 973,484,000 marks, on February 23,
while the highest, 1,257,925,000 marks, was reached December 31, the
average for the year being 1,083,497,000 marks, against an average for
the year 1895 of 1,095,59,5,000 marks. The amount of uncovered notes
allotted to the bank in accordance with section 9 of the bank law was
exceeded in the year 1896 on the following dates and in the following
amounts: i in January 7, by 35,811,5^0 marks; on March 31, by 44,008,225
marks; on June 30, by 34,328,672 marks; on September 30, by 119,558,561
marks; on October 7,by 78,352,771 marks; on December31,by 134,149,422
marks. On these amounts a tax was paid of 464,801.22 marks, which
is carried as an item in the liabilities of the bank.
The latest obtainable statements of the bank from August 7, 1897, to
October 23, 1897, show that within this time the rate of discount
advanced from 3 per cent to 5 per cent. The rate continued from August
7 to August 31 at 3 per cent; advanced on September 7 and continued
until October 7 at 4 per cent, and reached 5 percent.on October 15 and 23.
At these various periods the outstanding circulation is shown to have
been as follows: 1,052,132,000 marks, 1,038,446,000 marks, 1,030,931,000
marks, 1,070,683,000 marks, 1,066,774,000 marks, 1,056,156,000 marks,
1,080,822,000 marks, 1,286,923,000 marks, 1,242,109,000 marks, 1,168,414,000 marks, 1,125,550,000 marks.
A study of these statistics, together with an observation of the promptness with which the increase or reduction of note issues was made,
shows how in each instance the operation of the bank conformed to the
volume and necessities of trade. It is impossible for any bank of issue,
no matter how well or skillfully managed, to attain the highest beneficial results where the note issues are based entirely upon a prerequiml
deposit of bonds. There is no strength in the argument oi a greater
satety to the note holder by such deposit as against the continual inconvenience and loss worked to trade through its operation.
The tendency of modern banking and legislation has been rather
toward the increase of freedom of note issues instead of in the line of
restriction. Not only does this appear in the German Imperial Bank,
but the provision for bank note-issue without metallic cover, but subject to the restraint of a heavy tax, has also been adopted by the
reorganized Bank of Austro-Hungary.
It is respectfully suggested that a careful study of the needs of the
sections of the United States now deprived of proper currency facilities could be improved by such amendment to the law as under proper
control would incorporate into the national bank act provision for banknote issue as against bankable assets and limited in volume by the
restraining influence of a properly graduated tax.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XIX
ORGANIZATIONS, EXTENSIONS AND LIQUIDATIONS OF NATIONAL
BANKS.
The total number of national banks organized from the date of the
granting of the first certificate of authority on June 20,1863, to the
close of the year embraced in this report has been 5,095, making an
average for each year of 150. On the 31st of October last there were
in active operation 3,617 banks, having an authorized capital stock of
$630,230,295. The total outstanding circulating notes of the banks in
active operation was $229,199,880, of which $202,994,555 was secured
by bonds of the United States and the balance by lawful money deposited with the Treasurer. The total of all national-bank circulation outstanding on October 31 was $230,131,005, of which amount $1,558,800
was secured by bonds held for account of insolvent and liquidating
banks and $26,205,325 by lawful money deposited for their account and
by active banks reducing circulation. The net decrease in the amount
of circulation secured by bonds during the year was $12,584,334, and
the gross decrease in the total circulation $4,851,292.
In geographical divisions the 3,617 banks in operation are divided as
follows: Five hundred and eighty-eight banks with authorized cajntal
stock of $159,191,620 in the New England States; 956 banks with capital stock of $195,124,275 in the Eastern States; 546 banks with capital
stock of $66,761,900 in the Southern States; 1,046 banks with capital stock of $160,163,967 in the Middle States; 357 banks with capital
stock of $32,654,100 in the Western States, and 124 banks with capital of $17,465,000 in the Pacific States.
In point of number of active banks Pennsylvania, New York, Massachusetts, Ohio, Illinois and Texas lead with 427, 326, 267, 249, 220,
and 202 banks, respectively. Arranged according to capital stock
Massachusetts is first, with $94,327,500; New York second, with
$83,169,940; Pennsylvania third, with $75,193,390; followed by Ohio,
with $45,235,967; Illinois, $37,296,000, and Texas, $19,985,000.
The paid in capital stock of national banks in each State on October
31, 1897, arranged in order of amount of capitalization, is shown in the
following table:
State.
Massachusetts ...««!•»•
New York
Pennsylvania
Ohio
Illinois
Connecticut
Texas
Rhode Island
Maryland
Missouri
New Jersey
Indiana
Minnesota
Iowa
Michigan
Kentucky
Maine
Nebraska
Wisconsin
Tennessee
Kansas
California
Vermont
New Hampshire
Colorado
Washington
Capital.
$94, 327, 500
83, 664, 940
75,345, 240
45, 630,100
37, 326, 000
21,641,070
20,106, 200
19. 337, 050
17; 079, 960
15,065, 000
14,445, 000
14,237,000
13,865, 000
13, 500, 000
12, 295, 000
11, 664, 900
11,171, 000
10, 775, 000
10,310,000
8, 760, 000
8, 717,100
7, 300, 000
6,9H5. COO
5, 805. COO
5, 2:52. 000
4, 738, 000
Capital.
State.
Virginia
Georgia
Montana
Alabama
West Virginia
Louisiana
District of Columbia
Oregon
North Carolina
Delaware
North Dakota
South Carolina
Utah
South Dakota
Florida
Arkansas
Wyoming
Mississippi
Idaho
Indian Territory
New Mexico
Arizona
Oklahoma
Nevada
Total
$4,646,300
4,016.000
3,855, 000
3, 455, 000
3.451,000
3, 360, 000
3,127,000
3, 070, 000
2,801,000
2,083, 985
1,985, 000
1. 890,100
1, 750. 000
1, 745, 000
1,485, 000
1, 220, 000
860, 000
755, 000
675, 000
C20, 000
600, 000
400, 000
300, 000
82,000
;
637,615,445
XX
REPORT OF THE COMPTROLLER OF THE CURRENCY.
There were organized during the report year 44 banks, located in 18
States and 2 Territories, with an aggregate capital stock of $4,420,000.
Of this number 9 were in Pennsylvania, 5 in Illinois, 3 each in Indiana,
Iowa, New York, Ohio, Texas, and Indian Territory, and 1 each in
California, Maryland, Massachusetts, Minnesota, Missouri, New Hampshire, New Jersey, North Carolina, North Dakota, South Carolina,
Tennessee, and Oklahoma Territory. The number located in the New
England States is 2, the capital stock aggregating $100,000; in the
Eastern States 14, with a combined capital stock of $760,000; in the
Southern States 6, having a total capital stock of $1,445,000; in
the Middle States 16, with an aggregate capital stock of $1,815,000;
in the Western States 5, the capital stock aggregating $250,000, and in
the Pacific States 1, having a capital stock of $50,000. The State of
Tennessee is first in amount of capital stock, having $1,000,000; Ohio
has $750,000, and Pennsylvania $510,000.
The corporate existence of 17 national banks in 12 States, with capital stock of $2,139,000 and a total circulation of $722,700, has been
extended during the year. New York has 3, Colorado, Michigan, and
Ohio, 2 each, and the following States 1 each: Georgia, Iowa, Maine,
Massachusetts, Nebraska, New Hampshire, Pennsylvania, and Texas.
Of the total capital New York aggregates $605,000; Colorado, $155,000;
Michigan, $100,000; Ohio, $279,000; Georgia, $150,000; Iowa, $50,000;
Maine, $100,000; Massachusetts, $150,000; Nebraska, $100,000; New
Hampshire, $100,000; Pennsylvania, $100,000, and Texas, $250,000.
Under the act of July 12, 1882, providing for the extension of
national banks, the corporate existence of 1,650 banks, representing
an aggregate capital stock of $405,386,115, has been extended. Of
these New York has 236, with capital stock of $74,177,460; Massachusetts, 229, with capital stock of $92,742,200; Pennsylvania, 205, with
capital stock of $53,876,000, followed by Ohio with 114, and an aggregate capital of $18,758,000.
The number of banks leaving the system by reason of the expiration
of their corporate existence was 2, having • capital stock of $150,000
and circulation of $61,200. These banks were located in New York
and Indiana, and were succeeded by new associations with capital
stock of $100,000 and circulation of $24,750.
During the year ending October 31,1898, the corporate existence of
23 banks, with a capital stock aggregating $2,679,000 and circulation of
$1,032,975, will expire. They are located as follows: 5 in New York, 4
in Pennsylvania, 3 in Illinois, 2 each in Kentucky and Massachusetts,
and 1 each in Delaware, District of Columbia, Indiana, North Dakota,
South Dakota, Vermont, and Washington. In the succeeding ten
years, from 1898 to 1907, inclusive, the corporate existence of 1,099
banks, having capital stock of $161,228,150 and circulation of $43,683,158, will expire.
The number of banks leaving the system during the year through
voluntary liquidation was 71, having capital stock of $9,659,000 and
circulation of $1,729,040.
A comparison of the data of this year with that set forth in the
report of this Bureau for the year 1896 shows the number of active
banks to have decreased 62, with a decrease in capital stock of
$11,090,500. The number of banks organized increased 16, and the
number going into voluntary liquidation, 33. There has been an
increase of 10 in the number of receivers appointed, and a decrease of
9 in the number of extensions of corporate existence. The loss through
expiration of charters increased 1, and t!ie number of banks organized
to succeed expiring association increased 1.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XXI
DIAGRAM.
The Comptroller's report for 1880 contained a diagram, exhibiting in a
clear and concise way the principal items entering into the statements
of the national banks, and showing how each had varied during the
twenty-one years of the life of the system, commencing with January
1,1866. This method so graphically presents the history of the growth
of, and changes in, the national banking system that it has been reproduced in this report and made to cover the entire period of its existence—
from October 5,1863, to October 5,1897, both dates inclusive. To make
its meaning still clearer, vertical lines have been introduced at certain
points to mark the dates of financial crises and other events which
nave had a notable effect upon the then existing condition of the banks.
The items of resources and liabilities selected are those which most distinctively indicate extension and growth and bear more or less close
relation to each other, namely: (1) Capital stock; (2) aggregate of
capital stock, surplus, and undivided profits; (3) individual deposits;
(4) lawful money reserves held against deposits; (5) national-bank
notes on hand; (6) loans and discounts; (7) aggregate of United States
bonds held for circulation, Government deposits, and for investment;
and (8) national-bank circulation.
The lines in the diagram show the variations in the several items at
each date for which reports of condition were made by the banks to the
Comptroller, commencing with October 5, 1863, the date on which the
first report was made. It is shown by the diagram that there was a
steady and substantial increase in the items of loans and discounts,
individual deposits and capital stock, aggregate of capital stock, surplus and profits, and circulation until September 12, 1873, when, as the
result of speculation, inflation of the currency, and resulting' causes, the
financial panic of 1873 occurred. This is marked in the sudden falling
off in deposits of $80,000,000, and in loans and discounts, respectively,
between September 12 and December 26 of that year. Following such
condition there was a rapid, though brief, recovery until June 30,1875,
when a steady downward movement in the items of deposits, loans and
discounts, capital stock, aggregate of capital stock, surplus, and profits
set in, continuing until January 1, 1879.
A period of reaction from high prices measured in a depreciated
paper currency and the readjustment of values to a specie basis between
the period of the passage of the resumption act in January, 1875, and
the successful resumption of specie payments provided for by that act
on January 1, 1879, followed. From the latter date the expansion of
loans and discounts and of deposits was rapid, while the increase in
capital stock, surplus, and profits, though less marked, was continually
steady and upward. The first break in this upward movement occurred
on April 24,1884, when the lines on the diagram show a sudden drop
of $80,000,000 in the item of deposits between that date and June 20,
with a corresponding reduction in the volume of loans and discounts,
and a falling off of surplus and profits. This continued until July,
1885, when bank deposits again reached and exceeded the point attained
on April 24, 1884.
The same upward tendencies are to be noted in the items of loans
and discounts, capital stock and aggregate of capital stock, surplus
and profits, until October 2, 1890, when again by December 19, owing
to the financial disturbance of that year, a sudden drop of about
$78,000,000 in deposits followed. Accompanying this was a similar
decrease in the volume of loans and discounts. At the latter date the
XXII
REPORT OF THE COMPTROLLER OF THE CURRENCY.
movement of loans and discounts, individual deposits, capital stock
and aggregate of capital stock, surplus and profits again became upward and continued steadily until May 4, 1893, the date of the well'
defined inception of the most serious financial crisis in the history oi
the system. The far-reaching extent of this crisis is measured by the
lines on the diagram, which show a falling off in deposits between May
4, and July 12, 1893, of $200,000,000, and a further falling off between
July 12 and October 3 of that year of $100,000,000 more, making
a total withdrawal of deposits within a period of five months of about
$300,000,000.
Following this was a contraction of loans and discounts of $140,000,000
between May 4 and July 12, 1893, and a further contraction of nearly
$180,000,000 additional between July 12 and October 3 of that year,
making a total reduction of nearly $320,000,000.
Within the year following October 2, 1893, $280,000,000 of the
$300,000,000 deposits withdrawn during the panic returned to the
banks, and the loans and discounts, though at a slower rate, expanded
to the amount of $160,000,000. Thereafter in both the deposits an i
loans and discounts of the banks is shown more or less variation, with
a general downward tendency, until the lowest point was touched on
October 0, 1896, the date of the reports of condition made a month
before the Presidential election in November. The increase in deposits
then became rapid and marked, the line indicating this item having
touched on October 5, 1897, the highest point in the history of the
system. The expansion of loans, though steady, was in smaller measure. In connection with the period from 1890 to 1897 it is worthy of
note that the silver-purchasing act was passed in July, 1890, and
repealed in August, 1893, and that this period covered the period of
greatest activity in the agitation for the free coinage of silver.
In contrast with the upward movement of deposits from October,
1893, to October, 1897, the diagram shows a continually downward
movement both tor capital stock and for the aggregate capital, surplus,
and profits, forcibly illustrating how the shrinkage of values through
losses and liquidation during the period of reaction after 1893 either
wasted the capital invested in some of the banks or caused its withdrawal because it could no longer be profitably employed.
National-bank circulation is shown, with slight variation, to have
kept pace with the capital stock relatively in its increase and decrease
from the beginning of the system until December 31,1881, after which,
while capital stock of the banks steadily increased until 1S93, circulation steadily decreased until October 2, 1890, when the lowest point at
any report date was touched, namely, $122,928,084. Between December 31,1881, and October 2,1890, capital stock increased by $184,000,000,
while circulation decreased by $202,000,000, the decrease being chiefly
due to the compulsory redemption by the Government between 1883
and 1888 of the 3 per cent bonds, of which the banks in 1883 held over
$200,000,000 as security for circulation. With the organization of new
banks and the legal requirement as to the deposit of bonds to secure
circulation a gradual expansion set in until 1893, when, between May 4
and October 3, under the exigencies of the currency famine, the extent
of the expansion of bond secured circulation was $31,000,000. This
expansion of the circulation strongly contrasts with the contraction in
deposits of $300,000,000, withdrawn from the banks during the same
period.
It is interesting to note how rapidly after each financial crisis, in 1873,
1884, and 1893, was lawful money reserve accumulated by the banks.
REPORT OF THE COMPTROLLER OF THE CURRENCY. XXIII
The accumulation after the panic of 1893 amounted between July 12
and December 19 of that year to $125,000,000, and continued until
May 4, 1894, when the national banks held $103,000,000 more cash
than they held on July 12, and more than they held at any time in
their history. This exhibition of ability on the part of the banks to
provide money with which to meet payment of demand obligations, by
conversion of their assets into cash, contrasts strongly to the weakness
of the Government in times of panic or distrust to maintain payment
of its demand obligations except by borrowing large sums of money on
iDtcrest* bearing bonds. It was distinctly manifest in 1893 and the years
following that the banks were meeting their obligations by converting
their accumulated assets into cash while the Government to sustain itself
was increasing its bonded indebtedness. In the end the Government
had to appeal to the banks and through their aid only was enabled to
maintain solvency. The difference must be accounted for by the fact
that the liabilities of the banks were secured by assets readily convertible into cash, and margined by a large amount representing their
capital stock, surplus, and profits, while the demand obligations of the
Government were supported by a percentage of cash, considered
adequate during periods of quiet and confidence, but totally insufficient
in time of panic and distrust. The Government was possessed of no
asset which could be changed immediately into money. It had only an
ability to borrow and then pay its borrowings through funds resulting
from taxation. Under such conditions it, at the best, was poorly
equipped to maintain itself against the claims of its creditors, holdingdemand obligations similar in character to the demand evidences of
indebtedness held by depositors against a bank.
Outstanding circulation decreased from October 3,1893, until December, 1894, after which the increase was gradual until March, 18!>7, followed by a decrease until October, 1897, the changes being influenced
by the fluctuations during this period of the prices of United States
bonds required to be deposited to secure circulation.
The item of United States bonds held for circulation, Government
deposits, and for investment necessarily in the main bears a close relation to the circulation outstanding based thereon. There is a marked
variation between January 1 and October 2, 1879, due to the part then
taken, by the national banks in the refunding operations of the Government. The change between December 9, 1893, and October 5, 1897,
shows the extent to which national banks invested in the bonds then
issued by the Government.
The line representing national-bank notes on hand demonstrates the
very limited amounts to which the notes of other national banks are
held in the total cash of the banks, the average holdings throughout
the whole period being about 820,000,000.
One noticeable feature of the diagram is the zigzag course of the line
indicating individual deposits, marking the frequent variations in volume, in times of prosperity as well as of panic, and in close relation to
deposits is the singular course exhibited by the line indicating lawful
money reserve held against deposits.
ANALYSIS OF REPORTS OF 1897.
An analysis of the abstracts of the reports made by the banks in
response to the five calls required by law, to be found in the appendix,
shows the following changes which have characterized the status of the
banks at different periods covered by these reports:
The change in the item of individual deposits during the report year
of 1897 is shown to be as follows: It increased from $1,597,891,058 on
XXIV
REPORT OF THE COMPTROLLER OF THE CURRENCY.
October 6,1896, to $1,639,688,393 on December 17,1896; to $1,669,219,961
on March 9, 1897; to $1,728,083,971 on May 14, 1897; to $1,770,480,563
on July 23, 1897, and to $1,853,349,128 on October 5, 1897, being
$255,000,000 more than the amount shown on October 6, 1896.
The number of banks holding these deposits on October 6,1896, was
3,676, with a capital stock of $648,540,325, as against 3,610 on October
5, 1897, with capital stock of $631,488,095.
The surplus fund of the banks on October 6, 1896, was $247,690,074,
and their net undivided profits $88,652,759. On October 5,1897, the
former had decreased to $246,345,020, while the latter had decreased to
$88,406,980.
On October 6, 1896, national-bank notes outstanding secured by
bonds deposited amounted to $209,944,019. The returns under each
call show variations in the amounts held during the year, the amount on
December 17,1896, being $210,689,985; on March 9,1897, $202,655,403;
on May 14,1897, $198,278,310; on July 23,1897, $196,590,790, and on
October 5, 1897, $198,920,670.
The amount due to other national banks, which on October 6,1896,
stood at $269,043,386, increased to $317,860,025 on December 17, 1896;
to $369,287,235 on March 9,1897; decreased to $363,219,013 on May 14,
1897, and then again increased to $388,117,906 on July 23, 1897, and to
$418,614,281 on October 5,1897.
The amount due to State banks and bankers, which on October 6,
1896, was $146,058,794, increased steadily throughout the year, being
$168,635,982 on December 17, 1896; $194,150,435 on March 9, 1897;
$195,001,040 on May 14, 1897; $208,876,900 on July 23, 1897, and
$227,063,685 on October 5, 1897.
The liabilities of the national banks for money borrowed in different
forms aggregated on October 0, 1896, $38,907,450, had decreased on
March 9,1897, to $18,193,210, and varied very slightly until October 5,
1897, when the amount had increased to $22,930,232.
The total liabilties, which on October 6,1896, were $3,263,685,313,
increased steadily throughout the year, being $3,705,133,707 on October
5,1897.
On the side of resources the loans and discounts, which on October
6, 1896, amounted to $1,893,268,839, increased to $1,901,160,110 on
December 17,1896, decreased slightly on March 9,1897, after which it
steadily increased, reaching $2,066,776,113 on October 5,1897, a gain
in this item of $173,507,274 since October 6, 1896.
The amount of United states bonds to secure circulation, which on
October 6, 1896, was $237,291,650, decreased to $227,483,950 on October 5, 1897.
The banks held on. October 6,1896, $25,135,500 United States bonds
other than those securing circulation. On December 17, 1896, the
amount had decreased to $24,274,550, then increased on March 9,1897,
to $30,429,900, and to $32,490,750 on October 5, 1897,
The investment of assets in stocks, securities, etc., on October 6,
1896, was $188,995,352. It had increased on October 5, 1897, to
$208,831,563.
The investment in banking house, furniture, and fixtures, which on
October 6,1896, was $78,046,817, showed but slight variations during
the year., being on October 5, 1897, $79,113,954.
Other real estate and mortgages owned on October 6,1896, amounted
to $27,403,155, and increased to $29,303,532 on October 5,1897.
The amount due from other national banks (not reserve agents) on
October 6,1896, was $111,830,935; increased to $125,382,562 on December 17, 1896; again increased to $133,467,636 on March 9,1897. and to
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XXV
$110,940,788 on May 14,1897; then decreased to $135,587,688 on July 23,
1897, after which the increase is marked, the amount due on October 5,
1897, being $155,980,447.
The amount due from State banks and bankers on October 6, 1896,
was $29,583,299 5 increased to $35,971,045 on May 14, 1897; decreased
to $34,275,424 on July 23,1897, and then increased to $41,410,311 on
October 5,1897.
The amount due from approved reserve agents increased from
$190,077,533 on October 6,1896, to $258,430,252 on March 9,1897, then
decreased to $251,948,640 on May 14, 1897, and again increased to
$297,017,805 on October 5,1897.
Exchanges for clearing house, which on October 6,1896, amounted
to $76,760,416, increased to $84,976,088 on December 17,1896; decreased
to $74,830,987 on March 9,1897; increased to $84,350,553 on May 14,
1897: to $89,457,189 on July 23,1897, and to $112,305,535 on October
5,1897.
The specie held by the banks on October 6, 1896, was $200,808,632,
while on October 5, 1897, it was $239,387,702.
The amount of legal-^tender notes and United States certificates of
deposit for such notes, which on October 6,1896, aggregated $142,334,730,
increased to $186,332,852 on March 9, 1807 5 decreased to $174,144,992
on May 14,1897, and continued to decrease until October 5,1897, when
the amount held was $149,494,929.
RECEIVERSHIPS.
During the year covered by this report the affairs of 38 banks have
been placed under the supervision of receivers. Of this number, 1
has been restored to solvency and resumed business. Of all the insolvent banks, 26 have been finally closed during this year, ending October
31, 1897,on which date 127 trusts still remained under the care of
receivers in the process of active liquidation.
There are 46 banks still in the hands of receivers on the inactive list,
the affairs of which are practically wound up, but the trusts can not be
finally closed because of pending litigation or the possession of valuable assets, the immediate disposition of which would entail an unwarranted sacrifice in value. The expenses of a trust in this condition are
nominal and limited to just what is actually necessary for the payment
of proper and careful attention to the matters not yet settled.' If a
considerable period of time elapses before the litigation is finally settled
or the remaining assets sold without unnecessary sacrifice, a final dividend is paid from the office of the Comptroller of the Currency after
the active supervision of the trust by the receiver is terminated.
A strenuous effort has been made during the period embraced in
this report to formally close several receiverships, tlie available assets
of which have been already realized on, but undetermined legal controversies have generally been the barrier preventing'the realization of the
desires and efforts of the Comptroller in this direction. Duringthe year
just closed the crisis, through which the country has been passing for
the last four years, has continued and when the enormous shrinkage
of values is considered it is a matter of agreeable surprise that many
receivers of national banks have so managed their trusts that a total of
dividends has been paid which, at the time of failure, seemed impossible.
The increase in rate per cent paid to creditors of, apparently, many
hopelessly insolvent institutions is due in part to the greater efficiency
.and economy in conducting the liquidations, and shows conclusively that
governmental supervision is growing more and more effective as new and
improved methods are evolved from experience in managing the affairs
XXVI
REPORT OF THE COMPTROLLER OF THE CURRENCY.
of insolvent associations. The criticism, which it is to be said is not
frequent, against receivers because they do not convert the assets into
cash quicker than they do and thus pay dividends, is largely because
of a failure to appreciate all the difficulties surrounding the situation.
Eeceivers are not^to blame if the trusts to which they are appointed
have very little of value in their assets. While banking is free in every
part of the country, associations will often be formed by men without
business tact, training, or judgment, or, worst of all, without even a
rudimentary knowledge of the first principles of commercial banking.
Associations formed and managed by such inexperienced men wiH be,
at least, unskillfully managed, and inevitably result in disaster. And,
on the other hand, so long as dishonest men see in banking a fair chance
to further their schemes they will embark in it, and defalcations and
embezzlements wiil be, accordingly, prevalent. Saddled with either
one or the other, or possibly both, of these misfortunes, a bank struggles on through a precarious existence of a few years and ultimately
fails. A receiver is appointed, and at once begins an earnest effort to
bring order out of confusion so far as possible, and to realize the utmost
possible for the creditors from a rather hopeless jnass of what generally
proves to be slow or doubtful, or absolutely worthless, assets. The
commercial paper which comes into his. hands is always slow, and
most of it either doubtful, bad, or absolutely worthless. With this
mass of paper, much of which requires litigation to collect either in
whole or in part, the receiver finds his position one of perplexity
and frequently of disappointment. The creditors are importunate, the
debtors proverbially and almost universally obdurate. With generally
no cash on hand to start with, the best commercial paper either rediscounted or hypothecated as collateral security, and often burdened
with unsalable real estate, the receiver begins his work of making what
collections he can from this mass of almost inconvertible assets. As a
rule he is successful, and the records show how much more has been
realized from the assets of foiled national banks than from those of
any other class of banking institutions or*other business undertakings.
PAYMENT OF DIVIDENDS DURING- THE YEAR JUST CLOSED.
Notwithstanding these conditions, which have always existed to a
greater or less extent in connection with insolvent banks, there was
paid to creditors within the year covered by this report the sum of
$13,169,781 in dividends. The magnitude of this unequaled record
will be the more forcibly illustrated if considered in the light of what
has been accomplished heretofore in the way of dividend payments to
creditors of insolvent institutions. In 1893 there was paid in dividends
to creditors of failed national banks the sum of $3,433,040: in 1804,
$5,124,577; in 1895, $3,380,552; in 1896, $2,451,9,19, and' in 1897,
$13,109,781, making a total of dividends paid within the live years
from 1893 fo 1897 of 827,560,515, or 30J per cent of all the dividends
that have ever been paid to creditors of insolvent national banks.
The unprecedented work of receivers during the last year is more conspicuously shown when the fact is realized that since the origin of
the national banking system in 1803 there has been paid to creditors
of insolvent associations down to and including 1897, a period of thirtyfour years, the sum of $75,935,925, and in the one year embraced in this
report there has been paid, as above stated, the sum of $13,109,781, or
17^ per cent of all the dividends that have ever been paid to the creditors of the 308 banks that have been placed in the charge of receivers.
Since October 31, the date of the closing of this report, seventeen
additional dividends, aggregating about $025,000, have been ordered.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XXVII
The following table sets forth in detail the names, location, capital
stock, and condition of the assets of failed banks of the year at the
time of the.appointment of receivers therefor:
THE NATIONAL BANKS IN EACH STATE AND GEOGRAPHICAL DIVISION WHICH WERE
PLACED IN THK CHARGE OF RECEIVERS DURING THE YEAR ENDED OCTOBER 31,
1897, WITH THEIR CAPITAL, NOMINAL ASSETS, AND LIABILITIES AT DATE OF
SUSPENSION.
Assets.
Name and location of Lank.
First National Bant, Niagara Falls,
NY
National Bank of Potsdam, N. Y
Keystone National Bank, Erie, Pa
Eastern States.
First National Bank, Asheville, N. C..
Merchants' National Bank, Ocala, Fla.
Merchants' National Bank, Jacksonville, Fla
Mutual National Bank, New Orleans,
La
First National Bank, Tyler, Tex
City National Bank, Gatesville, Tex . .
First National Bank, Newport, Ky
German National Bank, Louisville, Ky
! Estimat-1 Estimat-
Capital.
Total, a
$100, 000
200, 000
150.000
450, 000 j
$95,791 $135,119
152,125 455,334
116, 234 426, 436
$40,713
20,745
107, 053
$271,623
637,204
649, 723
364,150 11, 016,889 I 177,5ll j 1,5587550 1,051,437
21,514
32, 877
52, 969
93, 336
259, 747
120,875
334,230
247,088
215,428
150, 611
100, 000
153,080
139, 608
53, 805
346,493
232,154
200, 000
200, 000
50, 000
200, 000
251,500
162,646
44, 287
11,103
204,993
233, 745
269, 016
182, 330
47, 988
344, 896
306,123
65,848
470,037
30,198
264, 025
92,185
497,510
290,557
441, 052
37,405
650, 243
370, 367
813, 914
632, 053
2,387,817
1, 248, 993
80, 706
354,120
11, 578, 896
385, 562
27, 552
92, 040
245, 383
56, 075
224,791
253, 345
282,145
140, 632
324,787
48, 683
212,616
74,777
87, 866
36, 682
157755, 651
154, 373
100, 008
679, 050
1, 220,624
44,123
100, 493
54, 729
2, 354, 000
5,851,500 j 11,700,833 J8,787, 623 |8,664,997 J29,153,453 J21, 548,905
a Exclusive of United States bonds on deposit to secure circulation.
b Exclusive of capital, circulation, surplus, and undivided profits.
c Formerly in voluntary liquidation.
d Restored to solvency and resumed husiness.
$161,283
397, 365
492, 789
100,000
100, 000
Southern States
1, 201,500
864, 245 1,436,266 11,356,720 3,657,231
Missouri National Bank, Kansas
250,000
City, Mo
541, 307 765, 013 208,361 1, 514,681
50, 000
First National Bank, Franklin, Ohio..
23, 792
98, 255
4,985
127, 032
168, 784 208, 257 246, 955
Second National Bank, Iiockford, 111.. 200,000
623, 996
National Bank of Illinois, Chicago, 111.
First National Bank, East Saginaw, , 000, 000 7, 636, 207 1,490, 358 4,778,553 13, 905,118
Mich
231, 479 128, 033 223,650
100, 000
583,162
Big Ilapids National Bank, Big Rapids, Mich, c
1,065
100,
000
I
30,
693
23,490
55, 248
First National Bank, Benton Harbor,
Mich
50, 000
46, 597
81, 685
10, 649
138,931
75, 000
First National Bank, Decorah, Iowa..
63,259
134, 526 131, 758
329, 543
First NationalBank, Sioux City.Iowa d 100,000
50, 000
7,576
First National Bank, Griswold, Iowa..
64,514 I 39,474
111,564
Marine National Bank, Dulnth, Minn.
50,552 267,451 I 103,573
421, 576
Columbia National Bank, Minneapo- 200, 000
lis, Minn
150,763 202, 616 | 85, 057
438, 436
200, 000
Union National Bank, Minneapolis,
Minn
16, 217 507,068 253, 916
777, 201
500, 000
Second National Bank, Grand Forks,
I
76,049 106,004
N.Dak
189,423
7,370
50,000
Citizens' National Bank, Fargo, N.
80,160 308, 641
Dak
465,513
76,712
100,000
Merchants' National Bank, Devils
48, 522
Lake, N . D a k
97, 892
42,074
7,296
50,000 I
Dakota National Bank, Sioux Falls,
S.Dak
42,510
j
157, 962
298, 967
98,495
First National Bank, Garnett, K a n s . . .
50,000 !
85,796
7,624
38,719
132,139
First National Bank, Alma, Nehr
50,000
71, 923
67, 503
1,681
141,107
50, 000
First National Bank, Orleans, Nebr..
32,549
49, 631
7,219
89,399
50,000
3, 275, 000 i 9, 232,458 4, 783, 418 .6,425, 052 20,440, 928
Western States.
The Dalles National Bank, The Dalles,
Oreg
54,801 144,445
21, 644
220, 890
50,000
Moscow National Bank, Moscow,
Idaho
34,878
95,440
95, 325
205,643
75,000
Northwestern National Bank, Great
Falls, Mont
250, 000 j 422, 388 j329, 075
217,675
969,138
Merchants' National Bank, Helena,
350,000 I 619,922
Mont
755, 503 287,311 1, 662,736
Merchants and Miners' National
50, 000
9,259
Bank, Philipsburg, Mont
42,170
47,862
99, 291
First National Bank, Olympia, Wash. 100, 000
77,572 127,122
18, 807
223, 501
50, 000
First National Bank, Eddy, N. Mex...
41,160
115, 545
57, 295
17, 090
Pacific States and Territories... 925, 000 I 1,239, 980 |l, 551, 050 | 705, 714
3, 496, 744
United States
Liabilities, b
XXVIII
EEPORT OP THE COMPTROLLER OF THE CURRENCY.
The number, capital, assets, and liabilities of national banks, in each
State, which failed during the past year are shown in the following
table:
Assets, a
Banks, i Capital.
State.
New York
Pennsylvania..
North Carolina
Florida
Louisiana
Texas
Kentucky
Missouri
Ohio
Illinois
Michigan.
Iowa
Minnesota
North Dakota.
South Dakota.
Kansas
Nebraska
Oregon
Idaho
Montana
Washington ...
New Mexico . .
$300, 000
150, 000
100, 000
200, 000
200, 000
250, 000
451, 500
250, 000
50, 000
il, 200,000
250,000
225,000
900,000
200, 000
50, 000
50,000
100, 000
50, 000
75, 000
650, 000
100, 000
50,000
Total
mated
mated |
doubtful, worthless.1
Liabilities.
Total.
$247, 916 $590,453 $70,458 $908, 827
649, 723
116, 234 426, 436 107, 053
334, 230
21,514
52, 969 259, 747
593, 581
185,957 232, 944 174, 680
497, 510
162,646 269, 016
65, 848
785, 943
55, 390 230, 318 500, 235
I 438,738 651, 019 356, 210 1, 445, 967
541, 307 765, 013 208, 361 1,514, 681
127,032
23, 792
98, 255
4,985
7, 804, 991 1,698, 615 5,025, 508 114,529,114
777,
341
279,141 240,411 257, 789
441.107
70,835 199, 040 171, 232
1,
637,
213
217, 532 977,135 442, 546
752, 828
204, 731 456, 719
91, 378
298,
967
42, 510 157,962
98, 495
132,139
38,719
85,796
7,624
230, 506
8,900 104. 472 117,134
220, 890
54,801 144, 445
21,644
205, 643
14, 878
95, 440
95, 325
1,051,569 1,126, 748 552, 848 2, 731,165
223, 501
77, 572 127,122
18, 807
115, 545
41,160
57, 295
17, 090
$558,648
492,789
215,428
382,765
290, 557
478, 457
1, 020, 610
1, 248, 993
80,706
11,933,016
505,154
301,458
760, 281
514,102
212,616
74,777
124,548
154, 373
100, 608
1,943,797
100,493
54,729
38 5,851,500 jll,700,833 '8,787,623 8,664,997 29,153,453 i 21,548,905
a Exclusive of one bank in Iowa restored to solvency.
The number of failures of national banks in each year, capital stock,
circulation issued, claims proved, and dividends paid by the trusts
appear in the following table:
Year.
1865
1866
1867
1863
1869
1872
1873
1874
1875
1876
1877
1878
1879
1880
1882
1883
1884
1885
1886
1887
1888
1889
1890
1891
1892
1893
1894
1895
1896
1897
Number j
of
| Capital,
failures. !
$50, 000 !
500, 000
, 370, 000
210, 000
300, 000
, 806,100
825, 000 I
250,000 !
000,000 I
965,000
344,000 i
10 j 3,
14 2, 612,500 '
230,000
8
700, 000
3
561, 300
3 i 1.
250, 000
285, 000
600, 000
650, 000
550. 000
900J 000
250, 000
750, 000
622, 000
450,000
935,000
770, 000
235, 020
805, 000
851,500
1
2
7
3
2
6
11
3
5
368 i 61.627,420
I
Circulation.
Claims
proved.
i Dividends
|
paid.
$122,089
$44,000
$70,811
1,104, 044
265,000
267,156
928,900
3, 357, 563 2,455,515
141,800
308,112
238, 322
174, 700
239, 886
193,259
1, 388, 393 2, 558, 660 2,200,236
6,
930,123 5,052, 958
2,522,100
376, 579
230, 000
200, 704
638, 676
2, 566, 239
644,686
540, 609
1, 392,406
1, 021, 056
951, 728
3, 636, 723 3, 576, 632
1, 322, 725 2, 739, 079 2,334,156
1,108, 644
516, 825
884,454
506,143
778,966
724, 328
999,400
5,948.150
3,746, 278
108,200
609; 765
451, 375
850,120
6, 356, 830 4,812, 642
486, 550
3,775,062
2,915,978
328,385
856, 802
811,629
386, 597
5, 263, 402 3,220, 654
557,811
3, 590, 481 2, 832.257
56, 250
564, 794
569! 908
171, 450
811,864
1,108,014
663, 852
6. 804, 464 2,44f>. 860
623,153 10; 856, 609 8, 740, 575
1, 880. 404 13, 929, 579 8,645, 861
626, 786
3, 6<53, 050 1,150, 120
963, 752
6,144, 847
2,7;;o, 209
784, 400
6, 576,106
1, 314, 935
1, 229,118 18, 501,118 10,861,509
20, 893,827
121, 768,186
75,935,925
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XXIX
DISTRIBUTION OF NATIONAL BANK STOCK.
In 1876, iii compliance with a resolution of Congress, a compilation
was made of the number of shares of national bank stock issued, the
number of shareholders, the location, etc., of the stock and the shareholders. A similar compilation was made ten years later and continued in 1887,1888 and 1889. Prior to 1887 shares were taken at the par
value, varying from $10 to $200 each, as converted State banks were
permitted to reorganize as national banks without change of original
divisions of stock; subsequently the shares of every bank were reduced
in compiling the returns to a par of $100 each. The abstracts of the
reports for 1876 and 1886 are shown separately, the stock being based,
as hereinbefore stated, on the varying par values of shares, and differ
materially in that respect from the later compilations.
Of the 6,337,114 shares issued on July 5, 1897, 5,464,037 are held by
residents of the States in which the banks are located, 873,077 by nonresidents, of which 21,729 are held by residents of foreign countries.
The number owned by women is 1,418,542.
The investments by residents in the Few England and Eastern
States in the stock of the national banks located in the Southern States
amount to $5,294,600 j in the Middle States, $8,678,200; in the Western
States, $4,507,300; in the Pacific States, $1,823,600, and in all these
sections, $20,3(13,700.
The shareholders number 281,225, of which 270,149 are natural persons, including 101,944 women. The corporations which are shareholders number 11,076. The average investment by each shareholder
is about $2,250. A further classification shows that 169,948 persons
or corporations hold stock of the par value of $1,000 or less; 79,756,
over $1,000 or less than $5,000; 29,541, $5,000 or less than $30,000,
and 1,980, $30,000 or over.
The distribution, etc., of stock and number of shareholders is shown
in detail in the appendix. The condensed abstracts of the returns for
1870, 1886, 1887, 1888,1889, and 1897 are given herewith.
XXX
REPORT OF THE COMPTROLLER OF THE CURRENCY.
DISTRIBUTION OF SHAKES OF STOCK, ETC., OF NATIONAL BANKS ON THE FIRST MONDAY OF JULY IN 1876 AND 1886.
187G.
1880.
Number, j P e r cent, i Number, j Per cent.
2,091
"National banks in existence .
Snares held by—
State residents
Non-State residents.
Foreigners
1
5, 820, 908
G55,361
29, C61
10.1
.4
Natural persons .
Corporations
.2,8GS !
G, 42G, 320
690, 574
90.3
9.7
91.7
8.3
Total issue
I 6,505,930 j
6,524,143 I
592, 751 I
j 7,116,8^4 i
Total issue at par of $100 each
j 5,054,824 !
j 5,452,065
Shareholders—
Natural persons .
Corporations
183,91)6 i
24,490 •
Resident
Nonresident
Owning 10 shares or less
Owning over 10 and not more than 50
Owning over 50 and not more than 300
Owning over 50 and not more than 500
Owning over 300
Owning over 500
;
Total
104,976 j
77,496 !
88.3 I
11.7
50. 4
37.2
25, 247 1
.12.1 j
7G7"j"
"".i'l
;
215,879 i
7,704 i
198,151 i
25,432 i
96.5
3.5
88. C
11.4
52. 8
35. 2
11. 1
117, 974
78, 781
24, 770
2, 058 j
.9
223,583 !
208,.
DISTRIBUTION OF SHARES OF STOCK (AT PAH VALUE OF $100 EACH), ETC., OF
NATIONAL BANKS ON THE FIRST MONDAY OF JULY IX 1887, 1888,1889, AND 1897.
1887.
Number.
National banks in existence . . .
Shares held by—
State residents
Non-State residents.
1888.
0
n
,J
1889.
Number.
3,120 I
3,009 I
Number.
3,235
Shareholders:
Natural persons .
Corporations
,
|
j 89
3,615 '
80.2
13.8
j 5, 698, 822~; 89.9
1.2
I
Per
cent.
53, 529
6,580
.9
.1
532. 205
45, 978
8.4
.7
i 1,418,542
! 21,729
; 6,337,114
22.4
.3
95.6 j 270,149
11, 076
4. 4 j
96.1
3.D
.1 |
9.4
.3
j
I
i
233, 680 i 96. 9
7,492 | 3.1
234,950 96.1
9, 573 3.9
241,192
11,166
212, 272
28, 900
210, 703 86. 2
33, 820 13. 8
200,038 j 79.3 I 239, 010 i 85
52, 320 20. 7 i 42, 215 15
I
j
Owning $1,000 or less
!
Owning over $1,000 or less
than $5,000
Owning $5,000 or less than
$30,000
Owning $30,000 or over
I
Total
!
! 5,034,325 j 87.8 5,111,408 ! 86.7 : 5,209,462 j 85.4 !5, 464, 037
-- •- ; 13.3 j 888,521 i 14.6 j 873,077
697, 400 ; 12. 2 | 785,186
Natural persons
| 5,205,728 | 90. 8 | 5,317,110 i 90.2 j 5,426,279
Religious, charitable, and
52,963 i . 9 !
63, 876 ! 1.1
educational institutions .
72,320
4.094 j . 1 |
2, 926 ! . 1
Municipal corporations....
4, 325
Savings banks, loan and
trust and insurance com467,173
8.1
503,803 I
572. 510
panies
1,767
22, 519
8,879 i . 1
All other corporations
"Women
!
;
j
Foreigners
i
i
Shares issued, total.
5,731,725
! 5,81)6,594 j
6,097,983
Resident
Nonresident.
"Women
1897.
139,843 ! 57 9 i 141, 683 I 58
101, 944
36.3
141, C85 J 56.1
169, 948~
60 4
28.4
30. 4 I
73,132 • 20.9
§1,522 I 32.3
79, 756
26, 442 11
1, 682
.7 •
27.905 : 11.4
1.743 ! . 7
27,434 10.9
1,717 ! .7 i
29,541 ! 10.5
1, 980 I
.7
73, 205
241,172
244,523 ..
252,1358 ;
281,225 !
REPORT OF THE COMPTROLLER OF THE CURRENCY. XXXI
The foreign holdings of national-bank stock are shown in the table
following:
NUMBER OF SHARES OF STOCK OF NATIONAL BANKS, LOCATED IX EACH GEOGRAPHICAL DIVISION OF THE COUNTRY, OWNED ABROAD, JULY 5, 1897.
Xew
Southern Middle
Ena;Jand Eastern
States. States.
States.
States.
Countries.
"Western
States.
r-acitic
States.
05
57
Central .A.ni6ricflj
Chilo
China
Cubi
Denmark
OT Grin fin v
Hawaii
India
Italy
Jnmaica
..........
. - •. . •
..... .....
1,578
10
11
870
378
2
50
60
76
50
248
1,327
83
6
3
13
20
3,110
2,559
1,517
7
105
4
10
15
682
136
552
1,142
136
272
41
9
3
272
12
65
500
20
5
13
2,271
60
C3
I
50
Persia
5
Itussia
- -- . . . . . . . .
Spain
Sweden »••
•.....
Switzerland
"West Indies
Europo (not shown)
5
6
282
5
913
57
Africa
Foreign (not shown)
Total
5
100
17
311
1
9
50
260
47
469
20
10
90
5
25
Korea
6
175
15
10
99
40
37
1
70
05
107
3, 911
0
10
33
43
38
8,126
3, 529
2,453
476
175
101
360
12
100
90
381
1
30
3
11
381
45
955
158
87
19
6
19
17c
17
3,270
Total.
10, 398
1,906
1,980
3,023
1,146
21,729
WOMEN EMPLOYEES OF NATIONAL BANKS.
In 1893 the national banks submitted information relative to the
number and compensation of women employees. At that time the
number was only 383 and their average compensation $485.11. The
reports made on July 5, 1897, indicate the employment of 499 women
and that their average compensation is $477.02, or an aggregate of
$238,331. The number of such employees in the New England States
i»92; in the Eastern States, 125; in the Southern States, 33; in the
Middle States, 190; in the Western States, 48, and in the Pacific States,
11. This information, in connection with the investment by women in
national-bank stock, is shown in detail in the appendix.
EARNINGS AND DIVIDENDS OF NATIONAL BANKS AND TAXES PAID BY
THE BANKS TO THE GOVERNMENT.
'Six years after the passage of the national-bank act an amendment
thereto was passed (sec. 5212, Jlev. Stat.), which provided that within
ten days after the declaration of a dividend every national bank should
report to the Comptroller of the Currency the amount of such dividend
and the amount of net earnings in excess of such dividend. While the
dividend periods of a majority of the banks are semiannual, some are
quarterly and a few bimonthly; but all returns are compiled semiannually, in March and September. In the current report aiv shown the
last semiannual abstracts by reserve cities^ States, and geographical
XXXII REPORT OF THE COMPTROLLER OF THE CURRENCY.
divisions, of the capital, surplus, gross and net earnings, losses, premiums, expenses and taxes charged off, dividends paid and ratios of net
earnings to capital and surplus, dividends to capital and dividends to
capital and surplus. In another table are set forth the ratios for every
semiannual period from March 1,1893, to September 1,1897. This character of information is further supplemented by a table which gives the
average number of banks, capital stock, surplus fund, the amount of
net earnings and dividends, and the ratios of dividends to capital, dividends to capital and surplus, and net earnings to capital and surplus,
from March 1,1869, to March 1, 1897. The net earnings and dividends
paid during the last year were $48,612,927 and $43,215,818, respectively;
the percentage of dividends to capital was 6.7, dividends to capital and
surplus 4.8, net earnings to capital 7.5, and to capital and surplus 5.4.
The average annual net earnings and dividends for the past twentyeight years were $54,417,014 and $44,425,549, respectively. The average rate per cent of dividends to capital was 8.3, dividends to capital
and surplus 6.3, and net earnings to capital and surplus 7.8.
The .national banks have paid to the General Government f 81,411,384.54 in the form of semiannual duty on their circulation. In addition
to this amount they paid taxes on capital and deposits to the amount
of $7,855,887.74 and $00,940,067.16, respectively. The aggregate taxes
thus paid from 1863 to June 30, 1897, amount to $150,207,339.44. The
act of March 31, 1883, repealed the provision requiring the payment of
a tax on capital and deposits.
STATE BANKS AND BANKING INSTITUTIONS.
In 1873 Congress enacted legislation providing for the collection and
publication by the Comptroller of the Currency iu his annual report to
Congress of statements showing the resources and liabilities and condition of banks and banking companies and savings banks organized
under State and Territorial authority, the necessary information to be
obtained from reports made by such institutions to the State legislatures or officers, and the deficiency to be supplied from any other
authentic source. In that year, for the first time, returns obtainable
from State officials formed a portion of the report, and were confined
to 9 States—3 New England, 3 Eastern, and 3 Western, The number
of banks reporting is not stated, but the aggregate resources is shown to
have been nearly $179,000,000. The amount of capital was $42,700,000
and deposits $110,800,000. In 1887 the Comptroller, owing to the fact
that in so many States legislation had not been enacted providing for
the supervision of State banks, inaugurated a systematic attempt to
secure reports of their condition through direct correspondence with
banks located in such States. That this plan was productive of good
results is shown by the increase in the number of banks from which
reports were received over the prior year, viz, 564. The assets of the
banks reporting in that year (1887) were about $685,000,000—capital
$ 141,000,000, and deposits $446,000,000. To secure the necessary returns
the same means have been resorted to each year since the above date,
but the work incident thereto has been almost constantly lessened by
legislative action in a number of the States and Territories in the
establishment of banking departments, through which media the desired
information has been obtained.
With the exception of Delaware and Maryland, legal provision has
been made for the collection and publication of bank returns in each of
the New England, Eastern, and Central States. Delaware has but one
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XXXIII
State bank (with three brandies). This bank is required to submit
statements of condition to the governor, but as they do not appear to
be made public this Bureau depends upon the special reports made
thereto each year. In Maryland the banks are required to make semiannual statements to the State treasurer of taxable assets, but there is
no publication of abstracts of reports of condition. Through the courtesy of the officer above mentioned reports have been obtained from
banks which have failed to respond to the Comptroller's request for
statements. In Virginia and North Carolina banks are required to
make reports on the same days as are national banks, but in the former
State no provision is made for the publication of the consolidated
returns. Semiannual statements are made by the Florida banks,
abstracts of which are obtainable. In Mississippi quarterly reports
are called for. In Kentucky five reports are required each year, and
abstracts are furnished by the secretary of state. In 1876 Texas legislated against the creation of corporations with banking and discounting privileges and the renewal or extension of the charters of those
then doing business. Those still in operation, chartered prior to 1876,
are required to make semiannual reports to the secretary of state, from
whom copies are obtainable. With these exceptions, it is impossible to
obtain any official information relative to the condition of the banks in
the Southern States.
Within a recent period it has been possible to obtain quite full returns
relative to the condition of the banks in Nebraska, Kansas, North and
South Dakota, Montana, Wyoming, and Oklahoma. With the exception of North Carolina, Kentucky, Wisconsin, Nebraska, Kansas, the
Dakotas, Wyoming, and California, dependence for information relative
to private banks and bankers is placed upon the reports made voluntarily to this Bureau by those addressed. By reference to the comparative statements of the resources and liabilities of State banks
from 1873 to 1897 (p. 570) it will be noted that with but one exception
(1896) there has been an uninterrux>ted increase in the number of
banks reporting, which is due rather to legislative action providing for
the collection of banking statistics than to an actual increase in the
number of existing banks of that character, although there has been
a normal increase each year.
In January last a personal letter was addressed to the governor of
each State and Territory, in which the request was made that necessary legislation be recommended providing for the submission to the
proper officer of returns from banks and banking institutions organized
under State authority coinciding in time and corresponding in manner
with reports required from national banks. Special attention was
directed to the desirability of obtaining statements of condition on at
least one date of each year, preferably the 1st of July, as on or about
that date reports are required from national banks. Beports received
on this date could be compiled in ample time for use by the Comptroller
in his next succeeding report to Congress. It was also urged that the
reports should be required to show in detail the character and amount
of actual money held by the banks and also the amount of earnings
and dividends declared during the preceding year.
The resulting correspondence developed the fact that in many of the
States existing laws fully meet the suggestions with respect to the
character of the returns. In other States correspondents indicate a
willingness to recommend the necessary legislation, and in a few others
unwillingness was expressed to change existing arrangements.
H. Doc. 10——in
XXXIV
REPORT OF THE COMPTROLLER OF THE CURRENCY.
CONDITION OF STATE BANKS AND BANKING INSTITUTIONS.
From statements of State banks and banking institutions, obtained
through the courtesy of officials haying supervision of their general
operations and from returns made directly to this Bureau by banks in
States not requiring reports to be made to State officials, information
has been received relative to 5,088 institutions incorporated under State
authority, approximately 90 per cent of the number in operation in the
year 1897. In addition, statements have beeen obtained from 759
private banks and bankers, a total of 5,847 incorporated and private
banks, and an increase over the prior year of 132. In the appendix to
this report appear abstracts of the returns, by classes, States, and
geographical divisions.
The principal items of resources and liabilities of these banks in 1893
to 1897 inclusive are shown herewith:
Items.
Loans
Bonds
Cash
Capital
Surplus and
profits
Deposits
Resources
undivided
1893.
1894.
1895.
1896.
1897.
$2, 348,193, 077 $2,133, 628,978 !$2,417,468,494 $2,279,515,283 $2,231,013,262
1,009,604, 350 1, 010, 248, 230 1,375,026, 025 1, 210,827,389 1, 248,150,146
205, 645, 203
229,373,004 I 227, 743, 303
169,198, 601
193, 094, 029
406, 007, 240
398,735,390
422,052, 618
400, 831, 399
380, 090,778
346, 206, 287
352, 424, 784 j 370, 397, 003
362, 602, 702
3, 070,462, 680 2,973,414,101 i 3,185,245,810 3,276,710,916
3, 979, 008, 533 3, 868,474, 997 ; 4,138, 990, 529 4,200,124.955
382,436, 900
3, 324, 254,807
4, 258, 677, 065
The aggregate resources show an increase over 1896 of $58,552,110,
and over 1894, the lowest point during the period mentioned, of
$390,202,068. Loans and discounts and capital stock have decreased
during the year $48,502,021 and $20,740,621, respectively, but bond and
stock investments have increased $37,322,757; cash in bank, $23,895,428;
surplus and other profits, $19,834,288, and deposits, $47,543,891.
The capital of the reporting State banks aggregates $228,677,088;
surplus and other profits, $102,359,024; deposits, $723,640,795. Loans
and discounts amount to $669,973,556; United States bonds, $1,135,609;
other bonds, stocks, etc., $105,471,239; cash in bank, $116,849,749, and
total resources, $1,138,185,402. Comparing these figures with the
returns in 1896, an increase is shown of 149 in number of banks, and
$30,997,894 in aggregate resources. The increase in deposits is
$27,980,881. These banks held in cash 16.8 per cent of their net
deposits, and the credit balance with other banks was 11.5 per cent.
The net deposits, cash in bank, and credit with other banks, by States,
appear in the table in the appendix.
An attempt was made to ascertain the amount and rate per cent of
dividends paid by these financial institutions, but the result is only
fairly satisfactory, as the returns are confined to 557 banks, with
$37,841,887 capital stock, about one-sixth of the capital of banks
reporting their resources and liabilities. The amount of dividends paid
was $2,688,248, an average rate of 7 per cent.
CONDITION OF SAVINGS BANKS.
Eeturns relative to the savings banks in the United States are practically complete, but their value is somewhat impaired by the want of
uniformity in dates, showing the condition of the institutions. The latest obtainable information from savings banks in Maine, Massachusetts,
Rhode Island, Connecticut, Pennsylvania, Ohio, and Minnesota is from
reports made at various dates from October to December, 1896, and in
REPORT OF THE COMPTROLLER OF THE CURRENCY. XXXV
the other States from January to July, 1897. The number of institutions covered by this report is 980, 8 less than reported in 1896. It
is satisfactory to note, however, that there has been an increase in
resources of $55,517,311; in deposits, $47,947,096, and in surplus and
other undivided profits, $9,224,5S5. The increase in number of depositors, 135,638, is about one fifth of 1 per cent greater than the percentage
of increase of deposits, and, in consequence, the average deposit shows
a reduction from $376.50 to $372.88. Depositors number 5,201,132, and
the amount to their credit is $1,939,376,035. This does not include
$44,037,529 of deposits subject to check in stock savings banks, which
are operated under charters permitting both a commercial and savingsbank business. These two classes show total deposits of $1,983,413,564.
The surplus and undivided profit account amounts to $183,939,578,
about 9.3 per cent of liabilities to depositors. Nearly 50 -per cent
($1,066,507,686) of the resources of the savings banks is represented by
loans, of which $822,012,228 are on real estate security and $244,495,458
on other collateral.
Investments in United States bonds amount to $163,886,928, and in
other bonds, stocks, etc., $772,374,743. Balances due from other banking institutions and cash on hand aggregate $90,403,074 and $42,507,816
respectively, about 6.7 per cent of the net deposits. The savings bank
returns are exhibited in detail, by States and classes, in the table on
page 566. The mutual institutions, that is, those conducted solely for
the benefit of depositors, number 668, and, with the exception of 11
(4 in Ohio, 5 in Indiana, and 1 each in West Virginia and Wisconsin),
are located in the New England and Eastern States. The deposits and
total resources of the mutual savings banks are about 88 per cent and
87 per cent, respectively, of the deposits and resources of all savings
institutions. The depositors number 4,691,444, and they have to their
credit $1,737,099,370 (of which but $694,545 is subject to check), an
average savings deposit of $370.12, an increase of $1.92 over the average for the prior year. The largest average deposit, $504.48, is held
by the depositors in the Ehode Island banks; Connecticut follows with
$419.41; New York, $413.46; the minimum average being $208.53 in
Delaware. The average deposit in the banks in the New England
States is $363.81, and in the Eastern States, $376.71. With the exception of Ehode Island, in which there has been a reduction of only
about $50,000 in deposits, and New Hampshire (banks in charge of
assignees and in liquidation, with resources of about $13,000,000, heretofore included with active banks, but now omitted), substantial gains
are shown, the increase in resources and deposits being $56,903,528 and
$49,081,708, respectively. The surplus and undivided profit account
has increased from $158,595,655 in 1896 to $166,650,990; that is,
$8,055,335. Of the resources, $877,476,103 represents loans, $714,600,413 being on real-estate security; $162,804,101, United States bonds;
$728,671,010, other bonds and stocks; $66,060,649 with other banks and
bankers; $24,480,907, cash on hand, and $34,034,105, bank premises and
other real estate.
Nearly 47 per cent of the deposits are held by banks in the New
England States, and over 51 per cent by those in the Eastern States.
The deposits in the banks of Massachusetts, which are 26 per cent of
the total, paid interest at a rate slightly exceeding 4 per cent; the
interest rates in the other New England States are, Maine, 3.72; New
Hampshire, 3.5; Vermont, 4; Ehode Island, 4.5, and Connecticut, 4.
The New York savings banks hold nearly 42 per cent of the total, and
pay an average rate of 3.54 per cent. The rate in New Jersey is 3,
XXXVI REPORT OP THE COMPTROLLER OF THE CURRENCY.
Maryland 3.5, and in Delaware, West Virginia, Ohio, and Wisconsin 4,
and in Indiana 4 and 5 per cent. Summarized, it appears that 92 per
cent of all deposits in savings banks earn from 3.5 to 4.5 per cent; that
is, $876,057,718 (50 per cent) earning 3.5 to 3.72 and $738,740,712 (12
per cent) 4 per cent or over. Information relative to the cost of management has been obtained from but two states, Maine and Massachusetts. In the former the rate is one-fifth of 1 per cent, and in the latter
one-fourth of 1 per cent of deposits. Eeturns showing the classification of deposits are confined to Maine and Connecticut, and are given
herewith:
Depositors.
Classification of deposits.
Number.
Deposits.
Per
cent.
$500 or less
Over $500 and less than $2,000.
$2,000 and less than $5,000
$5,000 and over
77 !
20 i
2 !
Amount.
$15,
30,
9,
1,
713,
913,
297,
552,
392
841
083
579
Per
cent.
54
16
2
57,476,895 j
Total
CONNECTICUT.
$1,000 or less
Over $1,000 and less than $2,000..
Over $2,000 and less than $10,000.
$10,000 or over
Total
311, 937
31, 035
13, 274
199
356,445
888 1
8
M
60, 334,104
41,538,191
44,761,970
2, 862, 291
40
28
30
2
149,496,556
The assets of the 312 stock savings banks, from which reports have
been received, amount to $292,014,025, about 13 per cent of the assets
of all reporting savings institutions. The capital of these banks
aggregates $26,199,430; surplus and other profits, $17,288,588; savings
deposits, $202,971,210, and deposits subject to check, $43,342,984. The
number of depositors is 509,688, and the average savings deposit,
$398.22. This high average is mainly due to the fact that the deposits
and number of depositors in the California banks represent about 63
per cent and 80 per cent, respectively, of the total deposits and number
of depositors in all stock savings banks. The average deposit in the
California banks is $687.69. The total amount of loans of this class of
institutions is $189,031,583, nearly 60 per cent of which is secured by
real estate. Investments in United States and other bonds, stocks, etc.,
amount to $43,703,733; credits with other banks, $24,333,425; cash on
hand, $18,026,909; bank premises and other real estate, $13,377,961.
These banks hold in cash about 7 per cent of their net deposits, and
including credits with other banks, nearly 17 per cent.
LOAN AND TRUST COMPANIES.
Eeports have been received relative to the condition of 251 loan and
trust companies, all located in the New England and Eastern States,
except 4 in Indiana, 11 in Illinois, and 8 in Minnesota. The capital
of these companies is $106,968,253; surplus and undivided profits,
$89,025,267; deposits, $566,922,205. The loans aggregate $445,629,725;
United States bonds owned, $39,097,761; other bonds, stocks, etc.,
$162,030,259; cash on hand and with other institutions, $28,587,626
and $88,606,800, respectively; real estate, etc., $32,572,077; total
resources, $843,713,745. About 18 per cent of the net deposits is held
in cash and in credits with other financial institutions. The highest
rate of dividends paid on stock during the year was 13.9 per cent, paid
REPORT OF THE COMPTROLLER OF THE CURRENCY. XXXVII
by the New York State corporations, and the average rate was 7.8 per
cent.
Early in the year the editor of the New York Financier inaugurated
an investigation relative to the number, capital, deposits, etc., of all
trust companies in the country. Returns nearest to January 1, 1897?
were obtained from 458 corporations with capital of $141,278^000, an
average of $208,500. The surplus and undivided profits amounted to
$97,853,000 (69.27 of the capital); deposits, $675,100,000, the average per
company being $1,517,000; dividends paid by the New York City companies averaged for the prior year 15.33, nearly one-third higher than
the average rate paid by any other class of banking institutions in that
metropolis, and about 1J per cent higher than the average rate paid by
trust companies of the State of New York.
PRIVATE BANKS AND BANKERS.
Owing to the fact that in but few of the States and Territories are
statistics collected by State officials relating to the condition of private
banks and bankers and also to the disinclination of many proprietors
to intrust any public official with statements of their banking business,
notwithstanding the assurance given that such information will be
treated as confidential and used only to obtain for the public a knowledge of the aggregate amount of resources and liabilities of the banks
of this character, returns have been received from but 759 concerns,
only about 20 per cent of the number doing business. The aggregate
resources of the reporting banks are $77,953,444. The loans aggregate
$48,902,295; United States bonds, $879,898; other bonds and stocks,
$3,273,709, and cash on hand, $5,148,838. The capital is $18,246,007 5
surplus and undivided profits, $7,113,121, and deposits, $50,278,243.
In the following table are exhibited the principal items of resources
and liabilities of these banks and banking institutions:
State banks.
Items.
Loan and
trust
companies.
Private
banks.
Savings
banks.
Total.
_!_
$669,973,556 $445, 629, 725i$l,
066, 507,686 $48,902 295
39, 097, 761! 163, 886, 928
1,135, 609
879, 898
162,030,259
105,471, 239
772, 374, 743 3, 273. 709
28, 587,626
116,849,749
42, 507, 816 5,148, 838
106, 968, 253
228,677,088
26,199,430 18, 246, 007
89, 025, 267 183, 949, 578 7,113,121
102, 359, 024
723, 640, 795 566,922, 205 1,983,413,564 50,278,243
843,713, 745 2,198, 824,474 77,953,444
1,138,185,402
Loans
United States bond;
Other bonds
Cash
Capital
Surplus and profits
Deposits
Total resources . . .
$2,231, 013,262
205, 000,196
1,043,149, 950
193, 094, 029
380,090,778
382,436,990
3,324,254, 807
4,258, 677,065
For the purpose of comparison, and in order to present in the most
concise form the principal items of resources and liabilities of banks
from which returns have been received, the following table is given.
Information with respect to national banks is from the reports of July 23.
Items.
Loans
United States bonds.
Other bonds
Cash...
Capital
Surplus and profits..
Deposits
Total resources
,
3,610 national
banks.
5,847 other
banks.
$1,966,891,501
261,901, 200
204, 932,235
435,106, 500
632,153, 042
330,267,222
1,786,871,422
3,563,408, 054
$2,231, 013,262
205, 000,196
1, 043,149, 950
193, 094,029
380,090,778
382,436,990
3,324,254,807
4,258,677, 065
9,457, total
banks.
$4,197, 904,763
466,901,396
1,248,082,185
628,200,529
1, 012,243,820
712, 704,212
5, 111, 126,229
7,822,085,119
The capital stock of national banks on July 23, and of all other banks,
as exhibited by the latest returns to this Bureau, is shown to have been
XXXVIII REPORT OF THE COMPTROLLER OF THE CURRENCY.
$1,012,243,820, a decrease during the year of $39,732,434. The averages
per capita of population from 1893 to 1897, inclusive, were $16.29,
$15.G1, $15.44, $14.71, and $13.86, respectively. In contrast with the
decrease in capital stock is the enormous increase in aggregate banking
funds—that is, capital, surplus and undivided profits, and deposits—
which amount to $6,822,326,870, as against $6,695,486,521 in 1896, an
increase of $126,840,349. The per capita average in all banks is
$93.43; in national banks, $37.45; State banks, $14.45; loan and trust
companies, $10.45; savings banks, $30.04, and in private banks, $1.04.
In the following table are shown the banking funds of national and
other banking institutions, arranged in the order of magnitude, followed
by the average per capita of population and the average population
per square mile:
CAPITAL, SURPLUS, UNDIVIDED PROFITS, AND INDIVIDUAL DEPOSITS OF NATIONAL
BANKS ON JULY 23, 1897, AND OF OTHER BANKS AND BANKING INSTITUTIONS AT
DATE OF LATEST EEPORTS TO THE COMPTROLLER OF THE CURRENCY IN 1896-97;
THE P E R CAPITA BANKING FUNDS, AND THE AVERAGE POPULATION PER SQUARE
MILE.
I Averago I A v e r a S °
States.
New York
Massachusetts
.Pennsylvania
Illinois
California
Ohio
Connecticut
Missouri
New Jersey
Rhode Island
Michigan
Maryland
Iowa
Maino
Wisconsin
Minnesota
Indiana
Kentucky
New Hampshire
Texas
Kansas
Vermont
Nebraska
Virginia
Colorado
Tennessee
Louisiana
District of Columbia.
West Virginia
Georgia
Delaware
"Washington
North Carolina
Montana
Mississippi
South Carolina
Oregon
Alabama
South Dakota
North Dakota
Utah
Florida
Arkansas
Now Mexico
Wyoming
,
Idaho
Oklahoma
Arizona
Indian Territory
Nevada
Total
Capital, etc.
$2, 071, 531, 083
917, 577,194
692, 925,290
311, 622, 202
286,082, 372
269, 066, 742
242,169, 665
1G0,168, 664
159, 747,994
142, 987,148
141,251,785
125, 556, 731
116, 894, 615
98, 787, 054
94,183, 940
91, 407, 613
80, 888, 258
78,933, 299
70, 080, 781
61,357, 710
54,533, 251
53, 646, 584
53,535, 031
45, 989, 210
40.478, 503
39; 409,194
35,446, 503
30,083,839
27,982, 023
27,307, 616
18, 932, 507
18,830, 090
17,464, 975
17,055,731
15, 751, 384
14,848,744
14,412,186
12,780, 608
12,565,117
10,205, 968
9,431, 792
8, 503, 906
8,178,032
4,437, 312
4, 270,585
3, 543, 551
3,101, 89?.
3,008, 798
2,174,545
1,190, 653
6,822,320,870 I
latiou.
square
mile.
$259.23
344. 69
115. 31
69.08
191. 36
63.65
284.57
50.02
89.75
358. 36
59.42
106. 40
54.80
144.42
45.85
51.70
33.04
37.86
180.15
22.45
40.64
160. 62
38.24
26.01
78.29
20.48
28.09
103. 03
31.65
12.73
102. 34
40.23
9.82
75.80
10.91
11.60
33.28
7.63
32.47
40.50
34.67
17.14
C.01
22.52
49.65
23.47
14.16
41.22
10.40
20.59
140.65
320.14
132.89
79.63
9.44
102.94
170. 54
46.12
217. 73
319. 20
40. 34
96.04
38.07
20.70
36. Go
21.20
67.35
51.60
41.81
10.28
16.34
34.91
18.00
41.64
4.97
45.75
25.90
4,171.42
35.67
36.08
78.38
6.70
34.00
1.54
30.85
41.87
4.50
32.05
4.98
3.55
3.20
8.45
25.25
1.00
.87
1.78
5.61
.04
0.65
.40
REPORT OF THE COMPTROLLER OF THE CURRENCY. XXXIX
The amount of coin and other currency held by the banks on similar
dates was $G28,200,529, classified as follows: Gold, $242,353,002; silver,
$53,091,730; legal tenders, etc., $240,948,495; specie not classified and
fractional currency, $2,G78,853, and cash not classified, $82,528,449.
The last-named amount unquestionably includes an appreciable quantity of gold and silver, but what proportion it is impossible to state,
owing to the failure of many bank officers and public officials to report
the amount of each kind of currency held. The holdings of gold have
been increased during the year, $41,372,171; silver, $4,859,003; legal
tenders, etc., $40,425,543; cash not classified, $10,421,299; the aggregate increase being $90,344,010.
EXISTING BANKS AND BANK FAILURES.
The records show that 12,817 incorporated and private banks were
in existence in the country on or about July 1, 1897, and that during
the year 100 have failed, of which 38 were national, 50 State banks and
trust companies, 19 sayings banks, and 47 private banks and bankers.
The assets and liabilities of the banks other than national, as shown by
reports to the Bradstreet Company, were $17,929,103 and $24,090,879,
respectively.
The following table shows the number of each class of banks in
existence in 1897 and the number and percentage of failures during
the year:
Class.
National banks
State banks and trust companies.
Savings banks
Private banks and bankers
Total.
i Number of,
Failures.
banks in I
existence in
July, 1897. i Number. Percent.
3,619 i
4,099 1
1,273 i
3,826 !
12, 817
38 !
56 I
19 I
47
1.05
1. 36
1.49
1.23
160 i
1.25
A statement of the resources and liabilities of the 38 chartered banks
of the Dominion of Canada on September 30,1897, will be found in the
appendix. The capital of these banks is $02,279,925; circulation,
$38,61G,211; deposits, $211,819,044; total resources, $352,950,583. The
percentage of specie, bank notes, and checks to deposits was 16.2.
The average rate of dividends paid on stock for the past year was 7.4
per cent. During the month of September the average amount of
specie and Dominion notes held was $8,743,943 and $17,402,404, respectively, and the greatest amount of circulation outstanding was
$39,077,427.
The appendix to this report contains in detail, by classes, States,
etc., statistical information relative to the condition of the financial
institutions hereinbefore mentioned.
BUILDING AND LOAN ASSOCIATIONS.
In a bulletin issued in May last by the Commissioner of Labor appear
statistics and general information relative to building and loan associations in fourteen States for the year 1895-90, and comparisons with
the returns from the same States from reports made to that Bureau in
1893. While incomplete, the present returns enable very satisfactory
comparisons to be made in view of the fact that, based on the returns
XL
REPORT OF THE COMPTROLLER OF THE CURRENCY.
in 1893, about 76 per cent of the number of associations and nearly 80
per cent of the total assets are represented by associations located in
the States named. The current returns show an increase in every item,
as follows: Number of associations, 2 per cent; shares outstanding,
5,1 per cent; dues paid, paid-up and prepaid stock, and profits, 21.4 per
cent; and total assets, 21.4 per cent. The tables showing the assets
and liabilities of the associations in the States reporting in 1895-96,
number of associations reporting, shares outstanding, and assets of
associations in the fourteen States in 1893 and in 1895-96 are reproduced herewith.
ASSETS AND LIABILITIES OF ASSOCIATIONS IN 14 STATES, 1895-96.
As sets.
States.
Loans.
Cash on
hand.
Liabilities.
All other.
Total.
Installment
dues paid in
and paid-up
and prepaid
stock.
Profits.
All other.
$545,374 $2, 081,651 $21,470,309 $14,191,923 45,147,605
80,167
46, 713
1,931,663 / I , 497, 753
#94,168
2,856,919 7,195,920
82,639, 258
57,954,956 17,780,821
1,268,089 1.042,979
34,347,023
28,460, 286 4,369,589
84, 375
80,707
2,469, 884 ft 2, 356,549
(i)
795,397
478, 740
20, 552,667
17,217,776 jZ, 186,038
485,139 2, 563,676
26,352,955
17, 356,496 4,570, 375
62, 890
775, 958
3,924, 778
2,744,414
880, 329
67, 818
42,505
1, 853,070
1,334,417
445,479
(a)
(a)
38,882,110
29, 843, 237 8,070,538
2, 057,703 3,895,270
50,168, 683
35, 001,030 8, 573,364
4,719, 307 4,092,784
92,121,651 ^78,792,664
(i)
2, 701, 886 6, 666,506
99, 519, 918 j 86,694, 994 10,382,782
378, 504 3, 388, 348 b 13,425, 765 k 10,144,093 22,551,372
$2,130,781
339, 742
6,903,481
1,517,148
113, 335
148,853
4,426,084
300, 035
73,174
968, 335
6,594,28S
13,328,987
2,442,142
730,300
Total.. c402,327, 299 cl6,103,568 c32, 351, 757 d 489, 659, 734 m383,590,588 w66,052,460
40,016,686
California. $18,843,284
Conn
1, 804, 783
Illinois
72, 586,419
Indiana... 32,035,955
Maine
2, 304,802
Mass
19,278,530
Missouri.. 23,304,140
Nebraska .
3,085,930
NewHamp.
1,742,747
NewJersey
(a)
New York. 44,215, 710
Ohio
83,309, 560
Pa
90,151, 526
Tennessee.
9, 663,913
a Not reported.
b This total, although $5,000 less than the sum of the items, is apparently correct.
cNot including amount for New Jersey not reported.
d5See preceding notes,
e Including unearned premiums.
/Including profits in 2 associations.
g Profits in 2 associations included in dues paid in.
h Including profits.
i Profits included in dues paid in.
^Including items of premium, interest, and fines.
k Including matured shares in 1 and profits in 7 associations.
I Profits in 7 associations included in dues paid in.
m See preceding notes.
ASSOCIATIONS
REPORTING, SHARES OUTSTANDING, AND ASSETS O F ASSOCIATIONS
I N 14 S T A T E S , J A N U A R Y 1, 1893, A N D 1895-96.
States.
Number of associations reporting.
1893.
1895-96.
Shares outstanding.
Jan.1,1893. 1895-96.
Assets.
Jan. 1,1893.
1895-96,
California
Connecticut
Illinois
Indiana
Maine
Massachusetts..
Missouri
Nebraska
New Hampshire
NewJersey
New York
Ohio
Pennsylvania...
Tennessee
133
15
669
445
29
115
366
70
17
288
418
721
1,079
78
391, 222
147
18,266
13
726 2.672,183
501
573, 263
33
33, 472
119
366,100
288
465, 388
78
51, 567
18
55,406
301
577,163
361 1,294,746
745 i 1.036,184
1,131 | 1,603, 787
70
362,856 $18,093, 591
55,912
477,345
2,330,436 75,771, 559
814,811 26,623,795
42,817
1,375,227
461,913 13,653,330
299,663 35,841,560
70,615
3,073,563
1,447,489
(a)
693,810 31,714, 681
1,414,166 33, 008, 552
1,256,872 67,626,374
1,796,311 81,870, 964
385,817 12,897, 365
$21,470,300
1,931,663
82,639,258
34,347,023
2,469, 884
20,552, 667
26,352,955
3, 924,778
1,853,070
38,882,110
50,168, 683
92,121. 651
99, 519,918
13,425, 765
Total
4,443
4,531 ! 9,500,755 59,985,999 403,475,395
489,659,734
a Not reported.
b Not including shares for New Hampshire not reported.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XLI
POSTAL SAVINGS BANKS.
In order to bring within the compass of a single report as much
information and as many statistics as possible bearing upon the different kinds of banks and banking systems in the world, I herewith present
such data as it has been possible to collect, concerning postal savings
banks. The system originated in the United Kingdom, and the establishing act, passed May 17, 1881, reads as follows:
CAP. XIY.—An act to grant additional facilities for depositing small .savings at interest, with
the security of the Government for due repayment thereof.
Whereas it is expedient to enlarge the facilities now available for the deposit of
small savings, and to make the general post-office available for that purpose, and to
give the direct security of the State to every such depositor for repayment of all
monies so deposited by him, together with the interest due thereon:
Be it therefore enacted by the Queen's Most Excellent Majesty, by and with the advice
and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same :
1. It shall be lawful for the postmaster-general, with the consent of the commissioners of Her Majesty's treasury, to authorize and direct such of his officers as he
shall think lit to receive deposits for remittance to the principal office, and to repay
the same, under such regulations as he, with the concurrence of the commissioners
of Her Majesty's treasury, may prescribe in that respect.
2. Every deposit received by any officer of the postmaster-general appointed for
that purpose shall be entered by him at the time in the depositor's book, and the
entry shall be attested by him and by the dated stamp of his office, and the amount
of such deposit shall, upon the day of such receipt, be reported by such officer to the
postmaster-general, and the acknowledgment of the postmaster-general, signified by
the officer whom he shall appoint for the purpose, shall be forthwith transmitted to
the depositor, and the said acknowledgment shall be conclusive evidence of his claim
to the repayment thereof, with the interest thereon, upon demand made by him on
the postmaster-general; and, in order to allow a reasonable time for the receipt of
said acknowledgment, the entry by the proper officer in the depositor's book shall
also be conclusive evidence of title from ten days from the lodgment of the deposit;
and if the said acknowledgment shall not have been received by the depositor through
the post within ten days, and he shall before or upon the expiry thereof demand the
said acknowledgment from the postmaster-general, then the entry in his book shall
be conclusive evidence of title during another term of ten days, and toties quoties:
Provided always, That such deposits shall not be of less amount than one shilling,
nor of any sum not a multiple thereof.
3. On demand of the depositor or party legally authorized to claim on account of
a depositor, made in such form as shall be prescribed in that behalf for repayment
of any deposit, or any part thereof, the authority of the postmaster-general for such
repayment shall be transmitted to the depositor forthwith, and the depositor shall be
absolutely entitled to repayment of any sum or sums that may be due to him within
ten days at farthest after his demand shall be made at any post-office where deposits
are received or paid.
4. The officers of the postmaster-general engaged in the receipt or payment of
deposits shall not disclose the name of any depositor nor the amount deposited or
-withdrawn, except to the postmaster-general, or to such of his officers as may be
appointed to assist in carrying this act into operation.
5. All monies so deposited with the postmaster-general shall forthwith be paid
over to the commissioners for the reduction of the national debt; and all sums withdrawn by depositors, or by parties legally authorized to claim on account of
depositors, shall be repaid to them out of the said monies, through the office of Her
Majesty's postmaster-general.
6. If at any time the fund to be created under the authority of this act by the
investment of the deposits shall be insufficient to meet the lawful claims of all depositors, it shall be lawful for the commissioners of Her Majesty's treasury, upon being
duly informed thereof by the commissioners for the reduction of the national debt, to
issue the amount of such deficiency out of the consolidated fund of the United
Kingdom, or out of the growing produce thereof; and the said commissioners of Her
Majesty's treasury shall certify such deficiency to Parliament.
7. The interest payable to the parties making such deposit shall be at the rate of
two pounds ten shillings per centum per annum, but such interest shall not be calculated on any amount less than one pound or some multiple thereof, and not com-
XLII
EEPORT OF THE COMPTROLLER OF THE CURRENCY.
mence until the first day of the calendar month next following the day of deposit,
and shall cease on the first day of the calendar month in which such deposit is
withdrawn.
8. Interest on deposits shall be calculated to the 31st day of December in every
year, and shall be added to and become part of the principal money.
9. The monies remitted to the commissioners for the reduction of the national
debt under the authority of this act shall be invested in some or in all of the securities in which the funds of savings banks established under the existing laws may
be invested; and a separate and distinct account shall be kept by the said commissioners of all receipts, investments, sales, and repayments; and a balance sheet of
such account from the first day of January to the thirty-first of December in every
year shall be laid before both Houses of Parliament not latter than the thirty-first
of March in every year.
10. If any depositor making deposit under this act shall desire to transfer the
amount of such deposit to a savings bank established under the acts relating to
savings banks, he shall, upon application to the chief office of the postmaster-general,
be furnished with a certificate stating the whole amount which may be due to him,
with interest, and thereupon his account under this act shall bo closed; and upon
delivery of such certificate to the trustees or managers of the savings bank to which
it is proposed by the depositor to transfer such deposit they shall, if they think fit,
open an account for the amount stated in such certificate for such depositor, who
snail thereupon be subject to the rules of such savings bank; and the amount so
transferred shall, upon such certificate being forwarded to the commissioners for the
reduction of the national debt, be written off in the books of the said commissioners
from the amount of monies received under the authority of this act, and shall be
carried to the account of the savings bank to which such transfer shall have been
made; and in like manner, if any depositor in a savings bank, established under the
savings bank acts, shall desire to transfer the amount due to him, with interest, from
such savings bank to the postmaster-general for deposit under the provisions of this
act, the trustees or managers of such savings bank shall, upon his request, furnish
such depositor with a certificate, in a form to be approved by the commissioners for
the reduction of the national debt, signed by two trustees of such savings bank, and
thereupon his account with such savings bank shall be closed, which certificate the
depositor may deliver to any officer of the postmaster-general authorized to receive
deposits under this act, and such certificate shall, for the amount therein set forth,
bo considered to be a deposit made under the authority of this act, and, being forwarded to the said commissioners, the said amounts shall then bo transferred in the
books of the said commissioners from the account of the said savings bank to the
credit of the account of monies deposited under the authority of this act: Provided
always, That nothing contained in this act respecting savings banks shall render it
necessary to have the rules and regulations of any savings bank again certified if
the same have been before certified according to law.
11. The postmaster-general, with the consent of the commissioners to Her Majesty's
treasury, may make and, from time to time, as he shall see occasion, alter regulations
for superintending, inspecting, and regulating the mode of keeping and examining
the accounts of depositors, and with respect to the making of deposits and to the
withdrawal of deposits and interest and all other matters incidental to the carrying
this act into execution in his department, and all regulations so made shall be binding on the parties interested in the subject-matter thereof to the same extent as if
such regulations formed part of this act; and copies of all regulations issued under
the authority of this act .shall be laid before both houses of Parliament within fourteen days from the date thereof, if Parliament shall be then sitting, and if not, then
within fourteen days from the next reassembling of Parliament.
12. An annual account of all deposits received and paid under the authority of this
act, and of the expenses incurred during the year ended the thirty-first of December,
together with a. statement of the total amount due at the close of the year to all
depositors, shall be laid by the postmaster-general before both houses of Parliament
not later than the thirty-first of March in every year.
13. The annual accounts of the postmaster-general, and of the commissioners for
the reduction of the national debt, to the thirty-first of December in each year in
respect to all monies deposited or invested under the authority of this act shall annually, prior to the thirty-first of March in each year, be submitted for examination
and audit to the commissioners for auditing public accounts.
14. All the provisions of the acts now in force relating to savings banks as to matters for which no other provision is made by this act shall be deemed applicable to
this act so far as the same are not repugnant thereto.
15. All expenses incurred in the execution of this act shall be paid out of the
monies received under the authority of this act.
The operations of the system in the United Kingdom demand special
attention for tlie further reason that the accumulations at last reports
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XLIII
amounted to about 48 per cent of the total deposits in postal savings
banks of the world, and the number of depositors to nearly 40 per cent.
The growth of the system is remarkable when it is known that the
rate of interest paid on deposits, 2J per cent, is much below the average allowed on savings deposits in other countries, and that the investment of funds is confined mainly to Government securities. The rate
of interest has remained unchanged, and interest ceases when principal
and accrued interest of any one account amount to £200. In 1893 the
amount receivable from any one depositor in one year was increased
from £30 to £50. As a result, the increase in total deposits in 1804 and
1895 was about double the annual increase in prior years. The increase
from December 31,1893, to December 31,1895 (latest returns), was about
£28,500,000 (say $142,000,000). On this point a correspondent of tbc
London Economist of date March 27, 1897, says:
Tlio investment of these millions lias been the chief figure in raising the price of
consols from 98£ to 112, n. price at which they yield to tlio investor a present annual
return of only £2 9s. per cent. * * * The treasury finds itself obliged to accept
millions of money, repayable on demand, for which it has no employment, at 2£ per
cent, a higher rate of interest than it could borrow at on perpetuities, and to the
interest has to be added the expenses of management, so that the deposits are costing the post-office department £2 18s. 5|d. per cent, and can only be invested in
securities to yield a return of £2 9s. per cent at present prices of consols. If the
loss thus to arise were of small amount and was being incurred in the interest of
the class for whose benefit savings banks were founded, there would be few, if any,
to raise a voice against it. But in respect of x>ost-office banks the loss (£3,791) is
only at its commencement. * * * These institutions, it has to be remembered,
were established for the safe custody and increase solely of the small savings of the
industrial classes. But it has long been manifest that they are being utilized by
classes of the community who have no claim to the special advantages which they
afford to depositors.
The following statement by the correspondent referred to shows, by
classes, the number of depositors and amount of deposits at the close
of the year 1895:
Class.
| Deposits i
; not exceed-:
i
1
!
|
B
C.-..
Total
i
i n »—
;
Depos its.
Amount. ; Per cent.
£50 " £35, 300,192 '
100
23,967, 268 j
200
38,595,515 :
97, 868, 975
36
24
40
Dejjosi tors.
dumber.
5, 858,191
346,463
248, 943
Per cent.
00
6
4
6,453, 597
i
It is noted that to 90 per cent of the depositors belong only about
one-third of the deposits, the average deposit being only about $30.
To the remaining 10 per cent belong two-thirds of the deposits, the
average being about $525.
The same correspondent states that in view of the fact that deposits
are increasing at the rate of about £10,000,000 annually, and that this
increase.is mainly in the accounts of depositors in theO class, "people
who are presumably capable of taking care of their money without the
paternal assistance of the Government and have no claim to have their
banking accounts conducted for them at a loss to the public," there
should be an immediate return to the £30 limit, and that the rate of
interest on Class B accounts should be reduced to 2 per cent, and on
Cla-s O to If per cent; the 2£ per cent rate to continue on all deposits
not exceeding £50 each.
In addition to investing depositors' funds in Government stocks, for
which there are special regulations, the postmaster-general is empowered to insure the lives of persons of either sex for not less than £5 or
XLIV
REPORT OF THE COMPTROLLER OF THE CURRENCY.
more than £100. An insurance may be effected by any person not over
the age of 65 years or under 14, or if the amount does not exceed £5, not
under 8 years of age. The postmaster-general is also empowered to
grant immediate or deferred annuities for not less than £1 nor more
than £100 to any person not under the age of 5 years. All.premiums
for life insurance or annuities are payable through the medium of the
savings-bank dei>osit accounts and will be accepted in addition to ordinary deposits and deposits for immediate investment in Government
stock. All persons insuring their lives or purchasing annuities necessarily become savings-bank depositors and their premiums are deducted
from their deposits. (Senate Ex. Doc. Uo. 154, Fifty-fifth Congress, first
session.)
The investments at the close of the year ended December 31, 1895,
aggregated a trifle over $525,000,000, classified as follows: Consols,
$337,118,3555 stocks, $00,377,295; miscellaneous securities, $51,000,000$
annuities, $40,540,565; treasury bills, $16,955,675; advances, $8,207,810; dividends accrued but not paid, $3,200,765; bonds, $1,625,625;
balance in Bank of England, $294,930.
From the last (1890) annual report of the postmaster-general are
taken the following tables, which show minutely the transactions of the
post-office savings banks from 1886 to 1895, inclusive, the amount and
character of securities held, and the balance sheet on December 31,1895:
610
REPORT OF THE COMPTROLLER OF THE CURRENCY.
AGGREGATE RESOURCES AND LIABILITIES OF THE NATIONAL
1881,
MARCH 11.
Resources.
2,094 bftnks.
MAY
6.
2,102 b a n k s .
JUNE 30.
\ 2,115 b a n k s .
OCTOBER 1.
\ 2,132 b a n k s .
DECEMBER 31.
2,164 b a n k s .
Loans a n d d i s c o u n t s . $1,073,786,749.70j$l,093,649,382.18 $1,144,988,949.45 $1 ,173,796,083. 09 $1,169,177,557.16
352,653,500.
363,385,500. 00
368,735.700.00|
Bonds
- for
- circulation
- •" ' 339,811,950.00
~
XOOj 358,287,500.00
14,851,500.00
15,240,000.
15,265,000. 00
15,540,000. 00
15,715,000.00
Bonds for deposits . .
44,116,500.
46,626,150.00
48,584,950.00
31.884,000.00
40,866,750.
XI. S. bonds on h a n d .
52,908,123.
49,545,154.92
58,049,292.63
02,663,218.93
61,952,402.
Other stocks a n d b'ds
128,017,627.
156,258,637.05
123,530,465.75
120,820,691.09
132,968,183.
D u e from res'vc a g ' t s
63,176,225.
75,703,599.78
77,633,902. 77
62,295,517.34
78,505,446.
D u e from n a t ' l b a n k s
16,938,734.
18,850,775.
34
17,644,704.62
17,032,201.64
19,306,826.
D u e from S t a t e b a n k s
17,791,348.
47,834,060.20
47,445,050.46
47,525,790.02
47,329,111.
Real estate, etc
6,096,109.
4,235,911.19
4,647,101.04
7,810,930.83
6,731,936.
C u r r e n t expenses . . .
4,024,763.
4,115,980.01
3,891,728.72|
3,530,516.71
4,138,485.
P r e m i u m s paid
11,826,603.
13,534,227.31
17,337,964.78
10,1.44,682.87
14,831,879.
Cash items
196,633,558.
143,960,236.84
217,214,627.10
347,761,543.95
189,222,255.
Clear' g-houseexch'gs
25,120,933.
21,631,932.00
24,190,534.00
17,733,032.00
17,732,712.
Bills of other b a n k s .
386,950.
372,140.23
366,361.52
386,569.83
373,945.
Fractional currency.
122,628,562.
128,638,927.50!
113,680,639.
60
105,150,195.24
114,334,736.
Specie
62,516,296.
58,728,713.00;
60,104,387.00
52,156,439.
00
53,158,441.
Legal-tender notes . .
8,045,000.
9,540,000.
00
7,930.000.00
6,120,000.00
6,740,000.
U . S. cert's of deposit
18,456,600.
17,251,868. 22
18,097,923.40
17,015,269. 83
17,472,595.
D u e from U . S. T r e a s .
Total
i 2,140,110,944.78 2,270,226,817.76; 2,325,832,700.75 2,358,3S7,391.59; 2,38L,890,800. 85;
MARCH 11.
Resources.
2,187 banks.
Loans and discounts. $1,182,661,609.
!
Bonds for circulation
Bonds for deposits . .
U . S . bonds on h a n d .
Other stocks a n d b ' d s
D u e from r e s ' r e a g ' t s
Duo from n a t ' l b a n k s
D u e from S t a t e b a n k s
Real estate, etc
C u r r e n t expenses . . .
P r e m i u m s j>aid
Cash items
Clear g-house exch'gs
Bills of other b a n k s .
Fractional currency.
Specie
Legal-tender notes . .
IT. S. cert's of deposit
D u e from U . S . T r e a s .
Total
367,333,700.
16,093,000.
28,523.450.
64,430,686.
117,452,719.
68,301,645.
15,921,432.
47,073,247.
8,494,036.
3,762,382.
13,308,120.
162,088,077.
19,440,089.
389,508.
109,984,111.
56,633,572.
9,445,000.
17,720,701.
MAY 19.
JULY 1.
2,224 banks, j 2,239 banks.
OCTOBER 3.
2,269 b a n k s .
| DECEMBER 30.
2,3C8baiiks.
•3 $1,189,094,830.35 $1,208,932,655. 92 $1,243,203,210. 08 $1,230,456,213.07'
360,153,800.00
355,789,550.
357,631,750. 00; 357,047,050. COJ
15,920,000. 00
15,920,000.
16,111,000. 00
16,344,000.C0|
29,662,700. 00
27,242,550.
21,314,750.
15,492,150.00!
65,274,999. 32
66,691.399.
66,168,916.
66,998,620.361
124,189,945.23
118,455;012.
113,277,227.
122,066,106.75
66,883,512.75
75:366,970.
68,516,841.
76,073,227.76
16,890,174.92
16,344,688.
17,105,468.
18,405,748.49
46,956,574. 28
46,425,351.
46,537,066.
46,993,408.41|
6,774,571.86
3,030,464.
7,238,270.
5,130,505.53i
5,062,314.52
5,494,224.
6,515,155.
6,472,585.82
12,295,256.96
20,166,927.
14,784,025.
16,281,315.67'
107,270,094.71
159,114,220.
208,366,540.
155,951,194.81'
25,226,186.00
21,405,758.
20,689,425.
25,344,775.00;
390,236.36
373,725.
396,367.
401,314. 70:
112,415,806.73
111,694,262.
102,857,778.
106,427,153.40!
65,969,522.00
64,019,518.
63,313,517.
08,478,421. 001
10,395,000.00
11,045,000.
8,645,000.
8,475,000.00
17,099,385.14
16,830,407.
17,161,367.
17,954,069. 42
2,309,057,088.72 2,277,924,911.13; 2,344,342,686.90 2,393,833,670.84 2,360,793,467.09
18 8 3 .
Resources.
MARCH 13.
MAY 1.
JUNE 22.
2,343 b a n k s .
2,375 b a n k s .
2,417 b a n k s .
OCTOBER 2.
DECEMBER 31.
2,501 banks, j 2,529 banks.
Loans and discounts. $1,249,114,879.43$1,262,339,981.87 $1,285,591,902.19 $1,309,244,781. 64$l,307,491,250. 34
Bonds for circulation 354,746,500.00 354,480,250. 00 354,002,900. 00 351,412,850. ""' 345,595.800.00
Bonds for deposits ..
16,799,000.00
16,949,000.00
17,116,000.00
17,081,000.
16,846,000.00
U. S. bonds on hand .
17,850,100.00
15,870,600. 00
16,978,150.00
13,593,050.
13,151,250.00
Other stocks and b'ds
68,428,685.67
68,340,590.79
68,552,073.03
71,114,031.
71,609,421. 62
Due from res've agt's 121,024,154.60 109,306,823.23 126,646,954.62 124,918,728.
126,999,606.92
Due from nat'l banks
67,263,503.86
68,477,918. 02
66,164,638.21
65,714,229.
77,902,785.07
Due from Statebanks
16,993,341.72
19,382,129.33
19,451,498.16
18,266,275.
19,402,047.12
47,063,305.68
47,155,909.80
48,337,665.
Heal estate, etc
47,502,163.52
49,540,760.35
8,949,615.28
7,754,958. 86
8,808,327.
Current expenses . . .
8,829,278.26
4,878,318.44
7,420.939.84
7,798,445.04
8,064,073.
8.079.726.01
8,647,252.98
Premiums paid
ll,360;731.07
15,461,050.16
13,581,049.
17,491,804.43
Hi 109,701.18
Cash items
96,353,211.
134,545,273.98
Clear' g-house exch'gs 107,790,065.17 145,990,998.18
90,792,075.08
19,739,526.00
22,655,833.00
22,675,447.
28,809,699.00
Bills of other banks.
26,279,856.00
431,931.15
446,318.94
443,951.
427,754. 35
Fractional currency.
456,447. 36
107,817,983.
97,962,366.34
103,607,266. 32
114,276,158.04
Specie
115,354,394.62
70,672,997.
60,848,068.00;
68,256,468.00
80,559,790.00
Legal-tender notes ..
73,832,458. 00
9,970,000.
8,405,000. 00!
8,420,000.00
10,840,000.00
U. S. cert's of deposit
10,685,000.00!
16,586,712.
16,726,451.30
17,497,694. 31|
16,865,938.85
Due from U. S. Treas.
17,407,906.20j
Total
2,298,918,165.11. 2,360,192,235.85j 2,364,833,122.44! 2,372,650,364.82, 2,445,880,917.49
XLVI
REPORT OF THE COMPTROLLER OF THE CURRENCY.
POST-OFFICE SAVINGS BANKS
I. Table showing the business
I
r2
|
5
1890., . ,
1891.10,063
1892.|1O,519 .,
1893. 11,018 *9,838,198*
1894. ll,323|*10,973,651 *
1895. ill, 518*11,384, 977*
£ s. d.
£
£
£ s.
696, 852 2 7 10 169, 59012, S00,655113 689,943 5 14
535, 932 2 7 10 1 244, 074 t2,496,294 tl4,680,279 5 17
052,226 210 61 332,838 12,633, 808 U5,802,735 6 0
814,308 2 8 111 443,186 12,757, 848 f 16;814,268,6 1
990, 692'2 7 10 1 553,355*2,892,006
908,860,6 3
334,903*2 7
658,148 t3,126, 231
019,856|6 1
845,031[2 8
746, 263^3, 335, 068 f 20,
346,217:6
2
649, 02412 10
860,104 f 3, 618, 72] 764,566!6 0
439,449! 2 15
015,903 13, 863, 886 f 23;
786,927 6 3
078, 660J2 16
222,545.14,102,059 t\ 698,296 6 5
I
£
d.
6 +290, 555;+7T%
7j +.288,41817."
0+326,990 > T
758,2' t
794, 592
887, 460!
924, 010,
Ilij336,954
10;+326, 394 + ^ 997,283
992,
155
8 +343, 614 IQA
0:+354, 008 \Qj 1,036,622
rl,
027,130
3+367, 566 +6&
11*414, 557 +6&•1,135, 525
34414, 625 ^ 1,153, 236
!
* Including, as well as ordinary deposits, (a) deposits for immediate investment in stock; (&) amounts
realized by sale of stock and stock certificates obtained, the amount when stock is sold or a stock
certificate obtained being placed to the credit of the savings-bank account so as to be dealt with as a
withdrawal; (e) dividends; (d) deposits for purchase of annuities and payment of insurance premiums,
and (e) amounts credited to accounts in respect of sums payable to annuitants and insurants and their
representatives. For particulars see statements of G-overninent stock business and annuity and
insurance business.
t Including, as well as ordinary withdrawals, (a) withdrawals for investment in stock, with commission ; (b) withdrawals consequent on sale of stock and obtaining stock certificates, with commission
and lees; (c) withdrawals for purchase of annuities and payment of insurance premiums, and (d)
amounts paid to annuitants and insurants and their representatives. If or particulars see statements
of Government stock business and annuity and insurance business.
£7,751, £2,274, £3,446, £2,111, £1,774, and £21,502, respectively, for new buildings. Omitting these
amounts, but adding interest at the rate of 5 per cent tliereon, the cost per transaction will be m 1886,
7Tyi.; in 1887, 0,Vl.; in 1888, 6T80d.; in 1889, O&d.; in 1890, 6 ^ . ; in 1891, 6T7Bd.; in 1892, 6 ^ . ; in 1893,
6jyi.; in 1894, e^d., and in 1895. 6d., and the percentage of expenses to capital, 10s. 4£d., 10s., 9s. 10d..
9s. 6£d.. 9s 5d., 9s. 6d., 9s. 2£d., 9s. 0£d., 8s. 6£d., and 8s., respectively. Prior to the passing of tlio
post office savings-bank act, 1861, it was estimated (see Parliamentary Paper ISTo. 523,1861) that the
average cost of each transaction would be 7d.
REPORT OF THE COMPTROLLER OF THE CURRENCY. XLVII
or THE UNITED KINGDOM.
clone during the last ten years.
t'
a
i|
||
S*
If
plf : »!«
N ;s|i
6s§
1-2-i
u
^
°*
i ^1
11
*1
*a.
*s%
1 i «i 1 M i!J!l IS 111! !! a
1 ill Hi 11 fl | i C : i |l ; ! i\ rfj
'm »U ail i iIfl iHllll! 181 rt5 i!|
1 ;i il
1
ll
ill
|
562,499 3,731,421
574,252 3,051,761
018,294! 4,220,927
637, 128 4,507,809
677,778 4,827,314
701, 074 5,118, 395
702,7015,452,316
731,237 5,748,239
775,001 6,108,763
808,402 6,453,597
!
ill ill 1 nil iJj&fjfj! in In 111
£
&
50,874,33813
53,974,06513
58,556,394 13
62,999,62013
67,634,80714
71, 608, 002 13
75,853,07913
80,597,64114
89,266,06614
97,868,97515
1
8.
12
13
17
19
0
19
18
0
12
3
d.\ s.
8; t i l
2"flO
5111
6 |10
3t9
10 J 9
3 [9
5J9
3J9
4|8
!
d.1
£
5 ! 52,074,387
8 i 56, 248,599j
2 j 60,860,563
8£ 64, 7S6, 212
7 i 68,954,754!
7 72,417, 0451
4 78,123,988
1J 82, 857,698|
3£ 94,497,364!
5J105,064,203
'
£
272,263
322, 553
266,071
253, 615
155,673
173, 982
176, 056
415, 073
497,743
384,181
1
£
154,000
174,000
219,000
257, 00C
266,000
269, 000
273,000
276,000
312,000
330,000
1
£
52,500,6501 8,756
58, 745,152j 9,120
61,345,634 9,404
65,296,827(9,699
69,376,47710,005
72,860,027^10,366
78,573, 044i 10,800
83, 548, 771 j l l , 285
95,307,10711,580
105,784,38411,763
i
5,322,225
5, 556, 371
5,800,473
6,059,403
6,363,096
6,628, 677
6,954, 236
7, 219, 385
7,579,709
7,969,826
XLVIII
REPORT OF THE COMPTROLLER OF THE CURRENCY.
GOVERNMENT
II.—Table showing the business
Tear,
53
1
1886...
1887...
1888...
1889 & .
1890...
1891...
T892...
1893...
1894...
1895...
9, 653 4,945 35,305
10, 069 5,704 40,270
11, 629 8,575 43, 324
11, 261 7,592 48, 993
14,606 10,536 51, 063
11,516 7,494 55,085
8,356 60, 839
14,110
8,903 69,131
17,195
11,
015 71,304
13,188
9,725 12,080 68, 949
16,563
18, 204
19,413;
19, 766|
22, 385
20,841
23, 976
29, 298
23, 532
18,090
I
•!
8,918
10,216j
11, 459
11,882
12,096
12, 500
13, 727
15,283
18,315
19,608
36
126
204
258
360
427
159
164
£
£ s. d. £ s. d. £
845, 606 1,725 17
7 6 0 841,121
927, 614 1,917 1
5 10 0 915, 04'
996, 217 2,168 2
5 2 0 1, 003,164
985, 352 2,168 8
3 9 0 1,003, 368
1,125, 310
1, 089, 257 2, 332 12
4 0
989, 293 2,332 9
3 17 0 1, 025, 310
1, 234, 398 2,745 7
3 14 0 1, 264,104
1,533,027 3,218 13
3 2 0 1,544,506
3,227
8
1, 650,875
1 7 0 1, 625, 674
1,185, 720 2,837 0
3 2 0 1,112,568
a Dividends on 3 per cent stock converted paid quarterly instead of half yearly.
i
REPORT OF THE COMPTROLLER OF THE CURRENCY.
XLIX
STOCKS.
done during the last ten years.
£ s.
£
£
50 15
389, 965 43
462, 785 45
50 5
573,304| 50
51 13
605, 359! 50
50 15
50 5 5 590,907! 48
40 3 11 607,637! 48
52 14 5 688, 385! 50
52 14 4 711, 468; 46
69 1 8 978, 091! 53
61 10 01,L, 163, 930j59
s. d.\ £
14 6, 392, 053
6 0 469, 656
0 7j 572,113
18 11 535,6311
17 0 573,168|
12 2 583,6581
2 11 668, 689!
11 1 704, 329
8 0 993,459!
7 21. 238,491
£
7, 300j
5, 5001
5, lOO!
3,450|
4,0001
3,850;
3.700
3i 1001
1,350!
3100;
6,420
21, 931
37, 490
42,778
67, 417
72, 960
22. 774
27, 611
£
!
£
77,908; 2,896,941
91,169: 3,345,106
110,878; 3,785,611
114,460! 4,175,634
118,326 c4, 680,168
131,913; 5,087,766
142,760 5,599,020
169,270 6,364,494
183,179 7,028,197
193,605, 6,949,948
£
82
83
87
88
91
92
92
92
98
100
s.
1
1
7
17
13
7
0
1
11
16
d.
1
4
7
1
3
7
3
4
0
b I n 1889 856 persons holding £59,975 redemption money under the provisions of the national debt
redemption act 1889 were paid off, and £4,114 of the amount was reinvested free of commission in one
or other of the new Government stocks.
c l n April, 1890, the residue of redemption money amounting to £248,532 was reinvested in 2 | percent
consolidated stock at 98, this being the final operation connected with the conversion scheme. The
balance of stock was thus increased by £5,072.
H. Doc. 10
IV
ANNUITIES AND LIFE INSURANCES.
*— lalyle showing the business done during the last ten years.
Year.
Contracts entered into.
No.
1886
1887
1888
1889...
1890....
1891
1892
1893
J894
1895
823
912
905
988
948
968
1,157
1,420
1,565
1,898
Receipts.
Amount
of an- Amount.
nuities.
£17, 388 £211,570
19, 299
234,174
23,404
286, 762
23, 361
292, 846
21, 956
273, 578
23, 673
296, 882
28,155
355, 723
36, 746
461, 599
41,495
540, 277
49,816
665, 363
w
LIFE INSURANCES.
ANNUITIES.
Deferred.
Immediate.
Payments.
No.
Amount.
16,234 £153, 878
164, 546
16, 556
178,160
17, 050
193,140
17, 537
206,422
17, 976
217, 595
18,195
230, 370
18, 523
251,474
19, 344
275, 243
20,418
305,712
21,911
Contracts entered into.
No.
87
90
138
131
116
142
214
159
164
169
Amount
of annuities.
"£1,772
1,628
2,719
2,858
2,527
2,183
4,253
3,091
3,772
4,038
Receipts.
No.
859
8G9
900
934
914
959
1,096
1,297
1, 283
1,300
Amount.
£10, 510
9, 721
10, 853
11, 464
14,283
12,578
15, 360
16,148
17, 202
23,863
Payments.
No.
246
264
301
343
412
475
478
535
600
646
Amount.
£3,122
5,020
3,877
4,097
4,644
6,341
0,932
8,070
9,130
8,957
Contracts entered into.
No.
506
585
580
671
468
529
1,983
853
1,128
720
O
Receipts.
Amount
of insurances.
No.
£34,188
36,168
34, 819
32,832
25,466
28,930
80,307
44, 000
56, 010"
38,358
12,187
12, 069
12, 016
12, 275
11, 799
11, 627
15, 517
19,305
20,107
20, 903
Amount.
£12, 623
13, 492
14,121
15,112
14, 422
15, 073
16, 099
17, 227
18, 229
19,140
Payments.
No.
158
182
190
343
196
232
190
228
291
290
Amount of
claims on
death and
surrender.
£5,942
5,976
5,538
7,473
6, 841
8, 561
7, 354
9, 226
9, 641
9,861
3
W
H
O
O
3
w
o
W
O
H
M
aw
w
w
REPORT OF THE COMPTROLLER OF THE CURRENCY.
LI
IV. TXVBLE S H O W I N G T H E N U M B E R AND AMOUNT O F CONTRACTS E N T E R E D INTO
FROM T H E COMMENCEMENT O F B U S I N E S S ON 1 7 T H O F A P R I L , 1865, TO T H E 3 1 S T
OF D E C E M B E R , 1895, AND T H E N U M B E R AND AMOUNT O F CONTRACTS I N E X I S T E N C E ON THE 31ST OF DECEMBER, 1895.
Contracts entered into—
From April 17,1865, to
Dec. 31, 1894.
No.
Contracts for annuities entered
into from the commencement
of business on April 17, 1865,
to Dec. 31, 1895, viz, immediate annuities
24,489
Deferred annuities and monthly allowances; money not re765
Deferred annuities and monthly allowances; money returnable
1,637
Contracts for sums payable at
death entered into from the
commencement of business on
April 17,1865, to Dec. 31,1895.. 15,122
Contracts for annuities in existence on Dec. 31, 1895, TIZ, immediate annuities
Deferred annuities and monthly allowances; money not re-
Amount.
Total.
From Jan. 1,1895,
to Dec. 31,1895.
No.
£
s. d.
449,699 7 0 1,898
Amount.
No.
£
s. d.
49,816 3 10 26,387
Amount.
£
s. d.
499,515 10 10
13,354 10 6
57
1,252 11 0
822
14,007 1 6
35,171 4 0
112
2, 785 10 C
1,749
37, C56 14 6
983,380 5 4
720
38,358 9 0
15,842
1,021,738 14 4
14,727
336,014 1 0
713
12,495 4 0
995
21,298 13 6
10. 024
616.522 7 2
Deferred annuities and monthly allowances; money returnContracts for sums payable at
death in existonce on Dec. 31,
1895
V. RETURN OF BALANCE SHEETS OF POST-OFFICE SAVINGS BANKS ON DEC. 31, 1895,
SHOWING BALANCE DUE DEPOSITORS, ESTIMATED AMOUNT OF EXPENSES REMAINING UNPAID, VALUE OF SECURITIES ACCORDING TO AVERAGE PRICE OF THE DAY
ON DEC. 31, 1895, AMOUNT OF CASH IN HAND AND DIVIDENDS ACCRUED BUT
NOT RECEIVED AT END OF YEAR, AND SURPLUS OR DEFICIENCY OF FUNDS TO
MEET LIABILITIES (SO FAR AS RELATES TO NATIONAL DEBT OFFICE).
Securities standing 5n the names of the commissioners for the reduction of the national debt
on account of the post-office savings-hanks
fund.
Amount.
Valueofsecuri-I
£
s. d.
£
s. d.
£
s. d.
54,485,191 15 7 58,026,729 0 0
2f per cent consols
352,041 19 11
9,079,170
15
8
9,396,942
0 0
53,630 17 3
2£ porcents
10,977,690 5 1 12,075,459 0 0
77,8.58 1 6
Local loans 3 per cent stock
75,000 0 0
78,469 0 0
487 12 1
2 | pei. cent annuities (1905)
10,200,000 0 0 10,200,000 0 0
66, 313 17 2
Book debt, per act 55 and 56 Viet., c. 26
303,500 0 0
325,124 0 0
Egyptian guaranteed 3 per cent bonds
3,482,900 0 0
3,391,135 0 0
Treasury bills
80,817 11 4
Advances per 43 Viet., c. 4; 43 and 44. Viet., c. 14,
and 45 and 40 Viet., c. 62, repayable by Irish
850,000 0 0
850,000 0 0
Land Commission, per 44 and 45 Viet., c. 7 1 . . .
Advance under British Museum (purchase of
200,000 0 0
200,000 0 0
land) act, 1894, 57 and 58 Viet., c.34, s. 1
1,418 9 6
Annuity»for a term of years in lieu oi annuities
converted per national debt act, 1883, 46 and
47 Viet., c. 54, 8. 5, and national debt act, 1885,
321,918 0 0 a 2,566,322 0 0
48 and 49 Viet., c. 43
Annuities for terms of years in lieu of stock
canceled per national debt act, 1883, 46 and 47
Viet., c.54; national debt act, 1885. 48 and 49
Viet., o. 43, and national debt and local loans
574,570 0 0 ab4,071,035 0 0
act, 1887, 50 and 51 Viet, c. 16
Annuity for a term of years granted to* repay
advances per 32 and 33 Viet., c. 42, payable by
Irish Land Commission per 44 and 45 Viet., c.
138,8C0 0 0
a 652,660 0 0
71
a Value, inclusive of interest, to Dec. 31, 1895.
b Cash value (at the price of consdta on Dec. 31, 1895) of the amount of 2% per cent consols, estimated
to have been unreplaced at Dec. 31, 1895, out of the amoi&it of stock originally canceled in exchange
for these annuities. (Act 54 and 55 Viet., c. 24.)
LTT
REPORT OF THE COMPTROLLER OF THE CURRENCY.
V. RETURN OF BALANCE SHEETS OF POST-OFFICE SAVINGS BANKS ON DEC. 31,1895,
SHOWING BALANCE DUE DEPOSITORS, ESTIMATED AMOUNT OF EXPENSES REMAINING UNPAID, VALUE OF SECURITIES ACCORDING TO AVERAGE PRICE OF THE DAY
ON DEC. 31, 1895, AMOUKT OF CASH ON HAND AND DIVIDENDS ACCRUED HUT
NOT RECEIVED AT END OF YEAR, AND SURPLUS OR DEFICIENCY OF FUNDS TO
MEET LIABILITIES (SO FAR AS RELATES TO NATIONAL DEBT OFFICE)—Continued.
Securities standing in the names of the commissioners for the reduction of the national debt
on account of the post office savings-banks
fund.
Annuity for a tersi of years per national debt
act, 1884,47 Viet., c. 2, s. 2
Annuities for terms of years per 46 Viet., c. 1,
s.2 .
Eed Sea and India telegraph annuity, expiring
Aug. 4,1908
,
Annuities for terms of years granted to»repay
advances under imperial defense act, 1888, 51
and 52 Viet., c. 32
Annuity for a term of years granted to repay
advance under Russian Dutch loan aat, 1891,
54 and 55 Viet., c. 26
Annuities for terms of years granted to repay
advances under telegraph act, 1892, 55 and 56
Viet., c. 59
Annuities for terms of years granted to repay
advances under public accounts and charges
and
act, 1801,54
,an
d 555 Viet.,
iet, c.
c 24,, s.s 4
it for
f a term
t
f years granted to repay
Annuity
of
advances under barracks act, 1890, 53 and 54
Viet., c. 25
Annuities for terms of years granted to repay
advances made under the pensions commutation act, 34 and 35 Viet., c. 30
Advances under pensions commutation act, 34
and 35 Viet., c. 30, during year ended Dec. 31,
1895, in respect of which an annuity had not
been granted
Advances under imblic accounts and charges
act, 1891, 54 and 55 Viet., c. 24, s. 4, during
year ended Dec. 31, 1895, in respect of which
'an annuity had not been granted
Advances under telegraph act, 1892, 55 and 56
Viet., c. 59, during year ended Dec. 31, 1895,
in respect of which «\
'' *
" not been
an annuity
had
granted
Advances under naval works act, 1895, 58 and
50 Viet., c. 35, during year ended Dec. 31,1895,
in respect of which an. annuity had not been
granted
Total
Add value of securities
Cash balance in Bank of England.
acValue of securi- Dividends
crued butfnot
ties at price of received
the
Dec. 31,1895. end of theatjear.
Amount.
&
s. d.
35,121 0 0
£
s. d.
«250,101 0 0
6,398 8 6 |
3,100
0 0|
I
a. d.
a 40,007 0 0
34,100 0 0
60,431 16 0 j a 282,976 0 0
i
5,176 18 0
a330,227 0 0
19,078 18 0
a 256,837 0 0
55,108 4 0 I a387,285 0 0
13,576 17 0 | a 164,186 0 0
36,433 6 0
a 193,908 0 0
31,561 13 0
31,562 0 0
521 1 7
40,000 0 0
40,000 0 0
937 16 1
145,000 0 0
145,000 0 0
2,644 2 0
375,000 0 0
375,000 0 0
3,445 0 8
104,365,064 0 0
640,153 9 1
104,365,064 0 0
i
58,980 0 3
.105,064,203 9 4
Total .
a Value, inclusive of interest, to Dec. 31,1895.
Gr. W. HERVEY,
NATIONAL DEBT OFFICE, June 6,1896.
Comptroller-General.
REPORT OP THE COMPTROLLER OF THE CURRENCY.
LIII
VI. BALANCE SHEET.
Return of balance sheets of post-office savings banks for 1895, showing balance due depositors, amount of expenses remaining unpaid, value of securities according to average
price of the day on December 31, 1895, amount of cash in hand and dividends accrued
but not received at end of year, etc, and surplus of assets over liabilities.
LIABILITIES.
ASSETS.
&
S.d.
Balance due to depositors on
Dec. 31, 1895 (including interest)
97,868,974 15 5
Amount of expenses remaining
unpaid (partly estimated)
29,750 7 10
Surplus of assets over liabilities
7,885,658 19 10
&
8. d.
Value of securities according to
the average price of the day
onDec.31,1895
105,005,217 9 1
Amount of cash in hands of commissioners for the reduction
of the national debt
58,986 0 3
105,064,203 9 4
Amount in the hands of Her
Majesty's postmaster-general.
Less amount required to meet
warrants issued to depositors
butnotcashedonDec.31,1895.
457,089 15 0
72,909 1 3
384,180 13 9
Value of the Central Savings
bank premises in Queen Victoria street, E. C
Total
105,784,384 3 1
Total
336,000 0 0
105,784,384 3 1
&
s. d.
Total amount received from depositors, including interest, to Dec.
31,1895
445,005,805 4 8
Total amount repaid to depositors to Dec. 31,1895
347,136,830 9 3
Number of transactions:
Deposits
163,601,652
Withdrawals
57,308,157
Number of accounts:
Opened
20,457,018
Closed
14,003,421
Remaining open
6,453,597
The total number of transactions, i. e., deposits and withdrawals, from the commencement of post-office savings-bank business to the end of the year 1895 was
220,909,809.
The sums of £126,279 14s. lid., £147,116 16s. 0d., £77,787 12s. Id., £125.345 4s. lid.,
£144,879 3s. lid., £145,799 10s. Id., £123,139 0s. Id., £93,79410s.2d., £93^040 11s. 5d.,
£64,608 15s. lid., £67,001 13s. 3d., £78,805 8s. 9d., £72,495 Is. 8d., £36,050 9s. 4d.,
£65,66212s. 2d., £51,117 19s. 2d., £29,922 8s. 3d., £35,100 9s. 10d., and £3,83610s. 3d.
have been paid into the exchequer out of the funds of the post-office savings banks
in the years 1877,1878,1879,1880,1881,1882,1883,1884,1885,1886,1887,1888,1889,1890,
1891,1892,1893,1894, and 1895, respectively, under sec. 14 of the act 40 Viet., c. 13,
being the excess of interest which had accrued during the years 1876,1877,1878,1879,
1880, 1881, 1882,1883, 1884, 1885,1886,1887, 1888,1889,1890, 1891, 1892, 1893, and 1894.
The sum of £218,145, the cost of the site of the new saviugs bank buildings in Queen
Victoria street, and £111,119 toward the cost of the new building, have been paid
for out of the funds of the post-office savings banks.
Eeferring to Table X, it is noted that between 1886 and 1895 the
number of banks increased from 8,351 to 11,518; number of deposits
from 6,562,395 to 11,384,977; number of accounts opened, from 3,731,421
to 6,453,597; deposits, from £50,874,338 to £97,868,975; average
account, from £13 12s. 8d. to £15 3s. 4d.; assets, from £52,500,650 to
£105,784,384. The cost of each transaction declined between the same
periods from 7|d. to 6|d., and the per cent of expenses to deposits from
11s. 5d. to 8s. 5|d.
Tables II and III set forth, from 1886 to 1895, the transactions in
Government stocks and annuities and life insurances; Table IY, number and amount of contracts entered into since 1865; Table Y, character and amount of securities, and Table YI the balance sheet lor the
year 1895.
LIV
REPORT OF THE COMPTROLLER OF THE CURRENCY.
The London Bankers' Magazine of November, 1897, contains a brief
synopsis of the last annual report (just issued) of the postmastergeneral relative to the postal savings banks of the United Kingdom
for the year ended on December 31,1896. On that date the deposits
aggregated £108,098,641, an addition during the year of £10,229,666,
an increase unparalleled in the history of the postal savings banks.
The number of accounts opened during the year was 408,438, against
344,834 in 1895. The total number of accounts at the close of 1896 was
nearly 7,000,000. It is stated that about 60J per cent of the depositors
consist of women and children. The average sum to the credit of each
account at the end of the year was £15 15s. Id., against £15 3s. 4d. in
1895. The balance sheet shows a loss on the work of the department
during the year of about £32,000. Since the organization of the system the Government has lost but £10,000 through fraud, default, and
accident.
The postal savings-bank system is also in operation in France, Netherlands, Sweden, Austria, Hungary, Italy, India, Canada, and in a
number of English colonies, but nowhere does it attain the importance,
either in magnitude of transactions or relatively to other savings institutions in those countries, that it does in the United Kingdom and its
dependencies.
In France the system was established in 1882. Its growth has been
so rapid that in volume of deposits it stands second to the United
Kingdom, though in number of depositors it is third, being exceeded
by Italy. The minimum deposit received is 50 centimes and the maximum 1,500 francs. All deposits are paid over to the Oaisse des Depots
et Consignations, a Government board acting as official trustee. Deposits are invested mainly in Government securities, but to some extent in
municipal stocks, mortgage bonds, real estate and other loans. The
interest rate is 2f per cent. At the close of 1895 the accounts numbered 2,488,075; deposits, $150,000,000, approximately, and the average
deposit about $00.
Italy, states Mr. H. W. Wolff*, in the Journal of the Eoyal Statistical
Society for June, 1897, is the original home of savings banks, the Monti
di Pieta, nominally pawn shops, but which transacted general banking
business and received and invested savings deposits. It was not until
1875, however, that the postal saving system, based on that of the
United Kingdom, was called into existence. At the close of 1895 the
banks numbered 4,7C3, over 90 per cent of the total number of saving
institutions in the country, having 2,89G,7C8 accounts and about
$90,000,000 deposits, the average being about $31. There are no deposit
limits, and interest is paid at the rate of 3 per cent.
On May 28, 1882, was enacted legislation establishing postal saving
banks in the Austro-Hungarian Empire, the act taking effect on the
1st day of the following January. Herewith is given a translation
of the act, the ministerial decree establishing the board of council, and
an article relative to the act from the None Freie Presse of October 14,
1882. These translations are reprinted from Senate Doc. No. 154,
Fifty-fifth Congress, first session.
LAW OF MAY 28, 1882, REGARDING THE INTRODUCTION OF POSTAL SAVINGS BANKS
IN THE COUNTRIES REPRESENTED IN THE REIGIISRATH.
With the consent of both houses of the Reichsrath I am pleased to order as follows:
ARTICLE 1. Under the administration and security of the state there will be established in Vienna a Government savings bank, belonging to the department of the
minister of commerce and subject to the postmaster-general, under the title "K. K.
Postsparcassen-Amt" (Imperial Royal Postal Savings Bank).
REPORT OF THE COMPTROLLER OF THE CURRENCY.
LV
The sphere of action, organizing, and number of persons employed will bo made
known by special decree.
As depositories of the postal savings banks shall serve the post-offices designated
for this purpose by the minister of commerce in the countries represented in the
Reichsrath.
The postal savings bank is charged with the administration and carrying out of
the business specified by this law; it represents publicly to this end the State
Government.
For rendering advice as well as for proposals in matters which concern the postal
savings banks a board of council will be established.
The regulations concerning the formation of this board as well as the rules governing its sphere of action will be made known by special decree.
ART. 2. The postal savings bank receives the deposits made at the post-offices and
pays out again deposits notified for withdrawal through the post-offices.
ART. 3. All deposits in excess of the current expenses will be invested at interest
by the savings bank. Interest on deposits will be procured by purchase of Austrian
Government securities paying interest.
ART. 4. Interest, as well as the total expenses of administration and other outlays,
will be defrayed from the proceeds of the savings thus invested.
As long as these proceeds are not sufficient to pay the interest and the expenses of
administration, the deficit, as well as the expenses of establishing the institution,
will be covered by loans advanced by the post-office department.
These loans are to be repaid to the post-office department out of realized surpluses
at the close of the fiscal year, without any interest.
The surplus remaining after the redemption of the above-mentioned loans will be
used for the formation of a reserve fund.
ART. 5. Every depositor will receive from the post-office where he makes his first
deposit a deposit book, in which is entered every deposit made, amount drawn out,
and amount of capitalized interest. Each subsequent deposit can be entered in the
book at whatever post-office it is made.
The person in whose favor the deposit was made will be regarded as the depositor.
The deposit book will be given free of charge and is exempt from stamp duty.
The postal savings bank will open an account with every depositor.
ART. 6. The deposit book will bear the name of the person for whom the deposit
was made and contain the memoranda necessary to the identity of the same, as well
as the signature of the depositor.
Depositors who can not write must bring with them a reliable person who can
vouch for the identity of the depositor and sign the deposit book in his stead.
A transfer of the deposit book to another person will be considered valid only when
the act of transfer has taken place before a post-office official authorized by the postal
savings bank.
When this is done, the person to whom the transfer was made will be regarded as
the owner of the deposit book. (Article 21, line 3.)
Minors likewise are entitled to make deposits, independently, and to draw out
money, provided the legal guardian makes no written protest at the postal savings
bank against it.
In case a deposit book is lost, a duplicate will be issued in accordance with the
provision prescribed in article 14.
For one and the same person only one postal savings bank deposit book can bo
issued.
Whoever takes out two or more deposit books loses the interest on the capital
inscribed in the second book or in those issued subsequently., If, however, the total
amount of the deposits in two or more deposit books which the dejjositor had caused
to be issued exceeds 1,000 florins, or if the depositor had deposited more than 300
florins within one year in the two or more books issued to him, then will the depositor lose, in the first case, that part of the capital which surpasses 1,000 florins, and
in the second case the part of the capital which surpasses 300 florins.
The minister of commerce is authorized, for reasons worthy of consideration, to
remit the loss of capital resulting from the foregoing clause.
The post-office employees are prohibited from giving information to anyone whomsoever, except to their superiors, concerning the names of depositors and amounts
paid in by them.
ART. 7. Each deposit must amount to at least 50 kreuzers or a multiple of 50
kreuzcrs. The total amount deposited in one year shall not exceed three hundred
florins, after deducting the sums which have been drawn out during the year.
The amount due to a depositor, in deposits made and interest on capital, shall not
exceed the sum of 1,000 florins after deducting the amounts which have been drawn
out.
Deposits to the amount of 50 kreuzers may be made in postage stamps or in special
postal savings marks as soon as the issue of such by the minister of commerce takes :
LV.T
REPORT OF THE COMPTROLLER OF THE CURRENCY.
place. They must be pasted upon blank forms, which will be furnished free of
charge.
ART. 8. The rate of interest for deposits is fixed at 3 per centum per annum. The
rate of interest can be changed only by legislation.
ART. 9. The interest on the deposits begins on the 1st and 16th of the month following the day the deposit was made, and ends on the last or 15th of the month preceding the day on which the notice of withdrawal was received at the post-office in
Vienna. Amounts of less than one florin will not bear interest. On the 31st of
December of each year the interest will be added to the capital, and will likewise
henceforth bear interest.
For calculations of interest, the month will be taken at thirty days.
The officially prepared table of interest will be posted up publicly at the places
for collection (post-offices).
ART. 10. An amount exceeding the sum of 1,000 florins will not bear interest.
ART. 11. The office of the postal savings bank is obliged to notify the depositor by
registered letter to reduce his capital as soon as the deposits and capitalized interest of
a depositor exceeds 1,000 florins. If the depositor has not reduced his credit during
the month following this notice, there will be purchased for his account, after the
lapse of this period, Government bonds of the common state debt, paying interest in
paper to the nominal value of 200 florins at the current rate of exchange, of which
proceeding the depositor will be notified.
No interest will be paid for the time which elapses between giving notice and the
period when the reduction of the credit of a depositor takes place.
In case the respective depositor shall not have taken possession of the securities
bought for his account, the office of the postal savings bank shall draw the interest
of these bonds which are in its keeping, and place it as a new deposit to the credit
of the respective depositor in the books of the institution.
A book shall be issued to the depositor for such Government bonds as are deposited
for him in the office of the postal savings bank.
ART. 12. At the wish of the depositor, and in accordance with the sufficiency of his
credit, may the deposits l>e devoted to the purchase of Austrian Government securities.
ART. 13. The repayment of the credit, or a part of the same, to the depositor or to
his legal successor or attorney shall take place upon a notice of withdrawal, which
may be done at any place of collection (post-office) designated by the party giving
notice.
The payment is made at the place of collection designated in the notice (post-office)
on j>resentation of the deposit book, by virtue of an order from the office of the
postal savings bank, except in cases where the provisions as mentioned in article 14
are applicable, or where a protest which has been made (articles 6 aud*17) prevent sit.
Notified amounts up to 10 florins will be ordered by the office of the postal savings
bank to be paid at the places of collection (post-offices) by return of mail, and will
be cashed immediately after arrival of the order of the office of the postal savings
bank.
The payment of amounts between 10 and 100 florins will take place at the latest
in fifteen days; that of amounts between 100 and 500 at the latest in a month; that
of amounts above 500 florins at the latest in two months after the arrival of the
noti ce.
ART. 14. If a deposit book is lost, the following proceedings take place: The owner,
in order to obtain a duplicate, shall immediately inform the office of the postal savings bank, either direct or through the nearest place of collection, of the loss, with
the most accurate description possible of the marks of the book.
The office of the postal savings banks shall note immediately upon its books a
memorandum, to the end that for the present payment upon the lost deposit book
may be made to no one. At the same time the office of the postal savings banks shall
publicly post u|> at the post-office which issued the lost book, and at that one to
which the book would perhaps be presented, an edict by which all are reminded that
after the expiration of one month from the date of publication, if within that time
no claim for the lost book was made, it will be declared null and void, and a new
book will be issued.
If no claim is made within a month, a duplicate will be issued by the office of the
postal savings banks on payment of 10 kreuzers, and the deposit book which was
lost will be declared as null and void. If a claim is established within a month, the
office of the postal savings bank must refer the party to the proper judge for decision,
and neither permit the issue of a duplicate nor allow any disposition of the lost book
to he made until judgment in regard to the claim set up has been given by competent
authority.
ART. 15. The provisions of paragraph 1480 of the common civil law, according to
which demands of arrears of interest cease after a lapse of three years, will not be
applied to deposits made in the postal savings banks. In regard to the prescription
of postal-savings-bank deposits, the general provisions of the common law are in force.
REPORT OF THE COMPTROLLER OP THE CURRENCY.
LVII
Deposits falling under the law of prescription revert to the post-office department.
Prescription is interrupted by every new deposit, by every notice of withdrawal,
and by every entry of interest on the deposit book.
ART. 16. The Government securities purchased by the administrators or at the
request of the depositor and held in safe-keeping by the savings bank shall revert
to the post-office department if no one applies during forty years either for the
securities themselves or for the interest, or if the depositor has never during that
length of time made any other application whatever to the postal savings bank concerning the capital or the interest.
ART. 17. Deposits made in the postal savings banks, as well as deposit books, are
neither subject to attachment nor can they lie mortgaged. Neither is the executive
surrender of a postal-savings-bank deposit book admissible. These provisions have
no application in regard to the books issued for purchased state rentes, as mentioned
in articles 11 and 12.
If a depositor is in bankruptcy, the administrator is empowered to give notice to
the postal savings bank to draw out and receipt for the balance to his credit.
A protest against the return payment of deposits can receive consideration only
in a case of a suit at law for the ownership of the deposit book or under the presumption mentioned in article 6. Such a protest must be made in writing, addressed
to the office of the postal savings bank in Vienna, accompanied by the proofs necessary to form a judgment.
ART. 18. The reserve fund, the immediate purpose of which is to cover possible
losses which the postal savings bank may possibly encounter, is to be formed by
depositing the surpluses which have remained at the close of the fiscal year, after
deduction of defrayed interest, expenses of administration, and other outlays, and
the return of advances made by the post*office department.
The reserve fund is gradually to be increased until it reaches 5 per centum of the
total amount of deposits. It shall not, however, exceed 2,000,000 florins, Austrian
currency.
*
ART. 19. The sums forming the reserve fund are to be invested at interest, and the
occasional profits will be added to the reserve fund until the latter has reached the
fixed maximum.
When the reserve fund has reached the prescribed limit, the entire surplus will be
accredited receipts to the post-office department.
ART 20. The office of the postal savings banks will render due accounts of all
deposits made at the places of collection (post-offices), and will be controlled by the
chief comptroller.
At the end of every calendar year the minister of commerce will report to both
houses of the Reichsrath the general condition of and the business done by the
postal savings banks and will cause it to be published in the official part of the
Wiener Zeitung.
The office of the postal savings banks will periodically publish in the Wiener
Zeitung the condition of the institution.
ART. 21. The correspondence of the office of the postal savings banks and
employe's with the depositors is free of postage.
The income of tho postal savings banks is free from taxes. The deposits addressed
to the office of the postal savings banks, to the officers and employe's by depositors
or by persons empowered by them, as well as the documents for a transfer, as mentioned in article 6, are free from taxes and stamps, and the interest on the deposits is
exempt from income tax or any tax taking its place.
ART. 22. The time when the office of the postal savings banks in Vienna and the
places of collections will commence operations will be fixed by the minister of commerce.
ART. 23. The minister of commerce is intrusted with carrying out of this law.
Schonbrunn, May 28,1882.
FRANCIS JOSEPH.
TAAFE.
PINO.
THE BOARD OF COUNCIL OF THE POSTAL SAVINGS BANK.
First. The board of council established by virtue of article 1 of the law of May
28,1882, shall be an advisory body to the minister of commerce in regard to the business of the office of the postal savings banks.
Second. The board of council consists of nine members, viz:
1. A president, nominated by His Majesty the Emperor, for the term of five years.
2. Four experts, nominated by the minister of commerce from the industrial and
mercantile classes.
3. Three Government officials in active service, nominated likewise by the minister
of commerce.
4. The director of the imperial royal office of the postal savings bank.
LVIII
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Third. Two members, experts, taken from the industrial aud mercantile classes,
and one member taken from among the Government officers, will go out each year
according to the turn established in the first year by drawing lots. In the places of
those whose term of office has expired, the board of council will elect two members
from the industrial and mercantile classes of the population, and the minister of
commerce will nominate a new member from the ranks of Government officials. The
ex-members of the board of council can be reflected, respectively renominated. The
minister of commerce has the right to dissolve the board of council at any time, in
which case, however, he will take pains that an immediate formation of a new board
takes place.
Fourth. Members who die or are lost to the board of council by other means are
replaced in the same manner and at the same time in the category to which they
belonged as if they had left in the turn decided by lotFifth. The members of the board must have their domicile in Vienna, with exception of the president and tvyo members taken from the technical men of the industrial
and mercantile circles, whose domicile is not limited to Vienna.
Sixth. As members of the board of council can be elected, only such persons who,
by virtue of the law of April 2, 1873, R. Gr. B. No. 41, are eligible to the Reichsrath
(paragraphs 19 and 20).
Members who, during their term of office, should lose their right-to be elected are
to be regarded as members whose term of office has expired.
Seventh. The board of council shall meet in the rooms of the office of the postal
savings bank by invitation of the president presiding. In case the president be
prevented from being present, the minister of commerce shall nominate a deputy for
the time of prevention.
Eighth, The regular annual meeting of the board of council shall take place after
the yearly balance has been struck by the office of the postal savings bank—that is
to say, upon communication from the director to the president. Aside from this, the
board of council shall meet as often as the minister of commerce orders, the director
desires, or at least four members of the board demand it. The respective communications are to be addressed to the president. Upon invitation of the presiding officer,
functionaries of the ministry of commerce or other persons may be invited as experts.
These experts have no right to vote,
Ninth. Those members of the board of council who are not Government officials
shall lay their affirmation into the hands of the minister of commerce.
The office of a member of the board of council is honorary and without remuneration. Those members who reside outside Vienna have a claim to a remuneration of
8 florins per day and traveling expenses, according to a schedule to be made.
Te! ith. The board of counci 1 shall have the right to examine,the books and accounts
of the office of the postal savings bank, and to ask information of the directors concerning the condition and business manipulation of the office. The board of council
shall make suggestions concerning improvements in the business manipulations of
the office of the postal sayings bank, either in consequence of intimation of the
minister of commerce or of its own accord, and submits the respective bills to the
minister of commerce. Changes in the regulations of the general management, as
well as in the fundamental outlines for the organization of the office of the postal
savings bank, and the statutes of organization for the board of council, shall not be
made unless the board of council has given its opinion m regard to the utility of the
alteration.
Eleventh. The board of council shall take its resolutions by a simple majority of
the votes of the members present in the assembly, convoked according to rule. * To
a valid resolution of the board of council the presence of at least six members, aside
from the president, is required. A record of his resolutions shall be kept by the
directors of the office of postal savings bank, to be submitted to the minister of
commerce.
The director shall have a right, in a given case, to put on record his negative vote,
and to represent it in a separate petition.
Twelfth. The board of council shall regulate its own business management, subject to approval of the minister of commerce.
THE PRACTICAL USES OF THE SAVINGS I3AXKS.
[Translation of an article appearing; in the K"eno Freio Presso of October 14, 1882, on the formation of
the postal savings bank in Austria.]
The regulations necessary to carry out the law of May 28, 1882, concerning the
postal savings bank have been approved by tho Emperor.
At tho beginning of next year the postal savings bank will commence its operations, and if the institution shall prosper, it must be free from the bureaucratic sj>irit
from which so many institutes in Austria suffer.
An effort to accomplish this is seen partially in the regulations of the organization,
REPORT OF THE COMPTROLLER OF THE CURRENCY.
LIX
but particularly from the blank forms prepared for the use of the public. They
excel in brevity and clearness of text, convenience, and perspicuity; for instance,
the forms for the transfer of deposit books, for the protest against payment to minors,
for the request for the purchase or sale of Government securities, for authorizing
the drawing out of one or more deposits, the forwarding of interest coupons, &c.
All these blank forms can bo had free of charge at the post-offices, are exempt from
taxes and stamp duty, and will be sent free of charge when declared as mail matter
containing deposits or as registered letter.
The deposit book is handy, practical, and neatly gotten up, which can not be said
of all Government blank forms.
Every depositor finds in his book a short enumeration of the most important regulations and privileges, being an advantage over all deposit books of existing postal
savings banks; a table of postal savings banks; a table of interest from which he
can learn at a glance the amount of interest due on any capital and for any space of
time, as well as the amount due him in a separate column, much more distinctly than
in the books of other countries.
We wish now to describe, for the clear understanding of the public, the method of
making a deppsit as provided by the law. A person wishing to make a deposit in
the postal savings bank goes to the nearest x>ost-offiee, pays over the amount desired,
which, however, can not be less than 50 kreuzers, and receives thereupon a deposit
book bearing his name, which henceforth he can present at any time at any post-office
in the Austrian Empire to make further deposits, which will be placed immediately
to his credit by the official, with signature and seal, and be separately receipted for
by the office of the postal savings bank by letter, free of postage, wherein ho is
informed of the receipt of his last deposit and the amount now due him, which must
correspond with the entries made on his book. If this should not be the case, he
must immediately remonstrate, which he can do by tearing off a perforated blank
form attached to the book, fill it out, and put it in the nearest letter box. This
insures safety to -the depositor and serves as a control over the post officials. The
interest will always be added by the office of the postal savings bank on the 31st
December. To this end the depositor must send his deposit book, postpaid, on the
anniversary of his first deposit to the office of the postal savings bank in Vienna, in
conformity with the rules of the English post-office savings bank. Of course he will
not lose his interest should ho fail to send in his deposit book. Simultaneously with
the deposit book the depositor receives a notice book which contains ten blank
forms of notice of withdrawal. These notices bear the printed number and series of
the book.
If ho wishes to draw a certain amount, he simply takes his notice book, fills out
the blank with tho sum he desires to draw, names the post-office where lie wishes
the payment to bo made, and puts it in the nearest letter box. If ho wishes registration, ho must ask for it at the post-office, where it will be granted free of charge.
By return of mails he receives a check, upon presentation of which at the poston! ce singled out by him he will immediately receive payment. He must bring with
him his dei>osit book, in which the payment will be entered. Should he not desire
to draw the amount himself, then he must authorize a person for tho single case.
A depositor may therefore give notice in Graz demanding payment to be made in
Prague, and authorize a person in Prague to receive the amount.
This convenience and novelty benefits especially the traveling workingman, who
in this manner may send home his savings; the merchant, who thus can send money
to his commercial traveler, and the sinal" tradesman, who by these means may fulfill
his obligations in the city. It was proposed that the money should by paid by the
letter carrier at the same time that he brought the check, which for the present,
however, could not be done, owing to existing post-office regulations, which is much
to be regretted.
According to the provisions of the law, a depositor is not allowed to have more
than one deposit book. However, for a third person a deposit book may bo taken and
deposits made; for instance, a father for his children or an office servant for his
institution. It is likewise provided that not more than 300 florins be deposited in
one book in a single year, and altogether not more than 1,000 florins. To watch
over this is the duty of the office of the postal savings bank. These maximnms,
however, may be reduced by payments or by the purchase of Government interestbearing securities.
In order to make it possible to save smaller amounts than 50 kreuzers, the following provision has been made:
Oblong pieces of white cardboard will be issued, having a 5-kreuzer postage stamp
imprinted in one corner, with a space for pasting on nine additional postage stamps
of 5 kreuzers each. Such a "savings card" can be bought for 5 kreuzers wherever
postage stamps are sold. When the savings card is filled up with ten postage
stamps, including the one imprinted, it represents tho minimum of a deposit of 50
kreuzers, and may bo offered as such at any post-office, and if it is the dei>ositor's
LX
REPORT OF THE COMPTROLLER OF THE CURRENCY.
first deposit, then a book will be issued to Mm. Children will in this manner be
stimulated to deposit their savings by having an opportunity to watch, so to speak,
the growing of their savings with every new 5 kreuzer postage stamp pasted on.
If a deposit book is lost, the nearest post-office is to be. advised, and after one
month's delay,, if not recovered, the book will be canceled free of charge; payment
in the meantime to anyone on the book is stopped and a new one will bo issued free
of charge. The officials and chief of the post-office are bound to treat the personal
matters of the depositors as office secrets to their fullest extent; they are not
allowed to give information to anyone except their superiors, otherwise they are
liable to discharge.
All blank forms employed are printed either in German alone or in two languages,
and are lettered, which serves at tbe same time as marking the series in the deposit
books.
The post-offices must render their accounts daily to the chief office in Vienna of all
moneys received or disbursements made, on the basis of which the latter makes its
daily balance. The deficit or surplus which results is settled every day by the
cashier's office of Lower Austria in Vienna.
The organization of the office of the postal savings bank is as follows: At the head
is a director, who receives his orders direct from the minister of commerce. The
number of employees will be taken partly from the ranks of Government officials
and partly be made up from persons engaged for the purpose on monthly pay.
A pension fund will be raised for these from rates deducted from their wages,
according to the profits realized by the institution. The remuneration of the postoffice officials is for the present fixed at the following rates: One kreuzer for every
deposit made at that particular office; five kreuzers for every book issued by that
particular office and existing at the end of the year (first deposit); for every thousand
florins paid in, deducting the payments up to 20,000 florins, 1 florin and 50 kreuzers;
up to 40,000 florins, 1 florin and 25 kreuzers; higher amounts, 1 florin. This remuneration is a triile higher than the ODO received by the officials in England and Italy,
for this reason, that, particularly in Austria, these employees will have to use their
influence to make the institution popular, to which end they are best adapted.
The postal savings banks have, moreover, everything in their favor, since the communication between the depositors and the savings banks and the office of the postal
savings bank in Vienna is carried on by about four thousand post-office officials now
in existence, with each one of whom they can without difficulty make deposits and
receive payments.
No depositor is henceforth required to make long journeys to deposit his savings,
as has been the case heretofore in the provinces. He will no longer be compelled to
lose a working day to make a deposit or receive a payment.
It is to be hoped, therefore, that the post office savings banks will flourish here in
Austria as they do in England and in Italy. It is greatly to be desired, for economy
is the mother of wealth.
The operation of the check or banking department is very fully
described by United States Minister Tripp in his report to this Bureau
in 1800 on banking in the Empire, as follows:
The depositor uses the postal bank not only as an ordinary bank of deposit, which
allows the depositor 2 per cent on open accounts, but also as a means of paying all
bills and collecting all indebtedness in every part of the city or country, free of all
postage or charges to the depositor. The system in vogue, which is both simple and
practical, is briefly as follows: If a depositor wishes to pay a debt to a creditor in
any part of Austria-Hungary, he simply fills out a postal check to the order of his
creditor, with address of same, together with the date and amount, incloses it in one
of the special envelopes addressed to the general office in Vienna, and the post-office
authorities find the payee, pay the amount, and take his receipt for same.
Within twenty-four hours the depositor receives through the post-office, from the central office of the bank in Vienna, a statement showing the transaction. It contains
date, name of depositor, number of the check, amount, and name of post-office where
it has been paid; also cash balance of the depositor. These statements reach the
depositor after every transaction. If thece have been several transactions in one
day, they all appear on the statement oi the day. The depositor is thus kept informed as to the condition of his account every twenty-lour hours, provided he has
drawn or made a deposit during the previous day. The check of the depositor, forwarded as above, thus becomes a post-office order without incurring the trouble,
time, and expense which the latter system involves. The depositors pay all their
bills in this manner, whether in the same city or in different parts of Austria-Hungary.
The receiver of the money sends his usual receipt by mail to the payer, and in addition the latter has the daily statement from the postal bank that siich a numbered
check for such an amount was paid on such a day. Furthermore, if the creditor to
REPOET OF THE COMPTROLLER OF THE CURRENCY.
LXI
whose order the check is paid is also a depositor in the postal bank, as it is the
custom for all business houses who are depositors in the postal bank to have their
deposit number printed on all their bills, statements, receipts, and business cards,
the debtor fills in the check with the name and deposit number of his creditor, forwards it in the same manner, free of postage, to the general office in Vienna, and the
creditor receives his daily statement that his account has been credited by so much
from depositor No.
(giving number of debtor), and likewise the debtor or issuer
of check receives his daily statement that his account has been debited by a like
amount paid to account of depositor No.
(giving the number of creditor). Thus
an enormous amount of transactions take place without the cash being withdrawn
from the bank.
The deposit blanks consist of two parts, each containing the name, address, and
number of depositor printed on their face, in addition to which each blank contains
its special number in its order in the book, which number appears on both divisions
of the blank. The blanks are used in two ways: If a depositor wishes to make a
cash deposit, he fills in a blank with the amount and date, presents it with the cash
in person or otherwise, at the nearest post-office (there are 125 post-offices in Vienna
alone). The postmaster or his deputy receives the deposit, places the date stamp
of the post-office on both portions of the blank, separates the latter, affixes his signature to one portion, which he gives to the depositor as a receipt. The other portion
is turned into the general office with the cash at the end of the day. Within twentyfour hours the depositor receives his daily .statement, showing his account credited
with the above transaction and inclosing the other half of the deposit blank. If a
depositor sends a bill to one of his debtors he usually incloses one of his deposit
blanks; the person receiving the bill fills in the amount of the bill on both portions
of the deposit blank, adds his name and address, and presents it or sends it with the
money to the nearest post-office, receiving half of the deposit blank, signed and
stamped as above, which he attaches to the original bill as a receipt. When the
depositor receives his next daily statement from the bank, he sees at once that his
account has been credited by the amount of the bill he has sent to his debtor, and
with the statement he receives the other half of the deposit blank which was presented by his debtor at the post-office when the latter made the deposit in his favor.
In order that the depositors may enjoy all of the above privileges and conveniences,
together with free postage and 2 per cent interest on deposit, each depositor is
required to keep a constant balance of 100 florins on deposit unless he express a
desire to close up his account; therefore the daily statements are most useful and
necessary. Any check he may draw, the payment of which Avould reduce his balance to 1 kreutzer below 100 florins, would be refused payment; therefore all payments are made direct from the one central office in Vienna, though they may be
made through any post-office in the monarchy.
The table on page 587 shows the extent to which use is made of the
check department as well as the savings department. Depositors in
both branches number 1,418,786. The average saving deposit is only
about $20, while the check deposit averages nearly $962. This is
stated to be the only country in which the check business is operated
through the post-office, and that so well and cheaply is the work performed that transactions of this character are almost entirely monopolized by the postal savings banks. Funds are invested in public securities, railway debentures, and mortgage bonds. Interest on deposits
is allowed at the rate of 3 per cent in the savings department, and 2
per cent in the banking department. On each transaction in the latter
department there is a charge of 2 kreutzers, the same amount on each
check issued in addition to a slight fee on entries on the debit side of
accounts.
The postal-savings system in the Netherlands was inaugurated in
1881. The minimum deposit accepted is 25 cents (Dutch), and interest at
the rate of 2.64: yev cent is allowed on accounts not exceeding 800
florins (say $320). Deposits are invested at the discretion of the
department in public and private securities, and in advances on
securities, etc. At the close of 1895 the depositors numbered 448,581;
the deposits amounted to $17,762,323, and the average account to $39,
approximately.
In 1865 a law was passed establishing savings banks in Belgium,
under the control, direction, and guaranty of the state, and creating a
LXII
REPORT OF THE COMPTROLLER OF THE CURRENCY.
bureau belonging to tho department of finance. The necessary
machinery was provided, books printed, notices published, blanks furnished free of cost or tax, rates of interest fixed, and disposition of
funds directed. All branches of the Banque Rationale act as agents
and depositaries. This law was supplemented by an act passed in 1869
which organized the postal system of the country as an auxiliary to the
savings banks, and subsequently public schools were added. The savings deposits on each day are transmitted to the central office at the
seat of government, leaving only sufficient funds on hand for current
daily needs. Unless directed to the contrary by the depositor, all savings are invested in Government securities, but the depositor may direct
the investment in certain other specified securities, but at his own risk.
The rate of interest was fixed at 3 per cent, but in 1881 the rate was
reduced to 2 per cent on sums over $2,400. Sums under $20 can be
withdrawn on demand, but for larger amounts notice may be required.
Postal savings stamps are issued in denominations from 2 centimes
(two-fifths of a cent) to $200. Stamps of similar denominations are
made use of largely by school children under special regulations. From
the year 1865 to 1877 expenses of the savings banks were met by a tax
of one-half of 1 per cent on deposits, and since 1877 by a tax of threeeighths of 1 per cent. The number of depositors in the Belgium savings banks on December 31, 1895, was 882,370, and their deposits
$03,093,274; average deposit, $72.18.
The operation of the postal savings system in Sweden began in 1883.
The management is conferred on a board, of which the postruastergcneral is the chairman, by whom investments are made in public
securities, stock, mortgage bonds, municipal loans, etc. The minimum
deposit received is 1 kronor (26.8 cents). The interest rate on all accounts
not exceeding 2,000 kronor ($536) is 3.6 per cent. At the close of 1895
there were 408,288 accounts and $10,696,745 deposits, the average
account amounting to $26.20.
In Canada the postal savings system has been in operation since 1868,
although not extended to the entire Dominion until 1885. In 1882 depositors numbered 51,463 and the deposits aggregated $9,473,661. On
January 30, 1S95, there were 120,628 depositors, with a credit balance
of $20,805,542, an average deposit of $222.22. The minimum and maximum deposits are $1 ancl $1,000 respectively, and the maximum balance
$3,000. Interest on deposits, which are turned over to the treasury, is
allowed at the rate of 3J per cent. The following synopsis of the laws
and regulations of postal savings banks of the Dominion is reproduced
from Senate Doc. 154.
"With a view of enlarging the facilities for the deposit of small
savings, the Dominion post-office department was made available by
Parliament in April, 1868, for that purpose, and savings banks were
established under its auspices, the Government being made directly
responsible for the deposits therein, as well as for accumulated interest
thereon.
"Under the act the postmaster-general has authority, with the consent of the governor in council, to direct such postmasters as he may
deem proper to receive deposits, which shall be remitted daily to him
at Ottawa. It is required that each deposit shall be promptly entered
in the depositors' books by the postmaster, and the entry attested by
him as well as by the dated stamp of his office.
"Upon the receipt of the deposit at Ottawa the postmaster-general
shall cause the same to be acknowledged to the depositor, which shall
be conclusive evidence of the latter's claim thereto, and such interest
as may from time to time accrue thereon.
REPORT OF TPIE COMPTROLLER OF THE CURRENCY.
LXIII
"In order, however, that the depositor shall run no risk during the
time intervening between the deposit and the receipt of the postmastergeneral's acknowledgment, the law provides that the entry in the
depositor's book at the post-office of deposit shall be conclusive evidence as to his right to the deposit for ten days from the date thereof.
At the expiration of this period, should the postmaster-general's
acknowledgment have failed to reach the depositor, the latter may
demand it, and the entry in the book in question in such case shall be
conclusive evidence of his title to the amount for an additional ten
days. A deposit can not be less than $1, nor of any sum not a multiple
thereof.
"Money deposited can not be seized or detained while in the hands of
the postmaster-general or while in transit to or from that officer, tinder
legal process against the depositor.
"Upon complying with certain rules, the depositor or his representative may withdraw the amount of the deposit, or any part thereof, and
the authorities shall allow no unnecessary delay to ensue in this
connection.
"Postmasters and others connected with the post-office at which
deposits are made or repaid are not allowed to disclose the names of
the depositors, the amount of the deposit, or of that withdrawn, to
other than the postmaster-general, or such of his officers as may be
appointed in connection with the post-office savings bank system.
"All moneys deposited with the postmaster-general on account of this
system are immediately paid over to the receiver-general of Canada,
who credits them to the post-office savings bank account, and all sums
withdrawn by depositors or others authorized are repaid from this fund
through the postmaster-general.
"The interest on deposits of this character is 4 per cent, and dates
from the 1st of the month following the deposit and ceases on the 1st
of the month in which the deposit may be withdrawn.
"The accumulated interest is added to the i>rincipal and becomes part
thereof on the 30th of June each year.
"A report is required to be made as soon as possible after the expiration of each month, to the auditor of public accounts, of the .moneys
received and paid during the preceding month, as well as of the total
amount on deposit, by the postmaster-general. This statement is published in the Canada Gazette, the official organ of the Government, for
the information of depositors and others.
"The postmaster-general is also required to render a statement to
Parliament, within ten days after its following session, of the deposits
received and the amount withdrawn, the expenses incurred in connection therewith during the fiscal year preceding, together with an
exhibit of the total amount due to depositors on the 30th of June as
indicated.
"The postmaster-general, subject to the conditions of the act, is
empowered to frame regulations governing deposits and all other matters
appertaining thereto. He is, however, required to submit such regulations to Parliament fourteen days after they shall have been framed,
should it be in session, but if not, then fourteen days after the next
ensuing session.
"A deposit of any one person can not exceed $300 in any fiscal year,
excepting io special cases and by express authority of the postmastergeneral. Interest is not allowed on sums over $1,000 during any
period.
"A depositor, upon making his first deposit, is required to give his
name in full, and his vocation and residence, to the postmaster or other
LXIV
KEPORT OF THE COMPTROLLER OF THE CURRENCY.
officer of the post-office department, and to make and sign the declaration provided by law and regulations, which must be witnessed by the
officer receiving the deposit or some person known to him, or by a
justice of the peace.
"Should the declaration or any part thereof not be true, the depositor
loses all right and title to the deposit.
" Depositors are not required to continue making their deposits at the
original office of deposit, but may do so at any office of deposit in the
Dominion.
This applies to withdrawing deposits also.
• u In changing from one office of deposit to another no notice to the
authorities or change of pass book is required.
"Depositors are required, on the anniversary of their first deposit, in
each year, to forward their books to the postmaster-general in order
that the entries therein may be compared with the entries in the books
of his department, as well as for the purpose of adding the accumulated
interest to the principal.
"Books for the use of depositors are furnished free by the post-office
department. No postage is charged on these books when in transit
through the mails to the postmaster-general. Married women, or
women who may afterwards marry, have sole control of their deposits."
The postal savings-bank system is in operation in New South Wales,
Queensland, Victoria, Western Australia, Tasmania, and New Zealand.
The minimum deposit is uniformly 1 shilling, and the maximum, on
which interest is allowed, ranges from £150, in Tasmania, to £500, in
South Australia and New Zealand. The lowest rate of interest is 3
per cent and the highest 4 per cent, paid only by the New Zealand
banks. Investments authorized vary, the principal being in government securities, debentures, stock, and mortgages. In 1895 the depositors in the Australasian postal savings banks numbered 474,035, and
the deposits amounted to £14,007,785.
Postal savings-bank returns from Australasia, India, and the Gape
Colony have been incorporated with like returns from other countries
published in the June, 1897, number of the Bulletin de Statistique, and
presumably represent with approximate correctness the deposits, etc.,
in the world's institutions of this character. The deposits held by
postal savings banks in the United Kingdom and dependencies are
about 61 per cent of the amount in all such depositaries. The number
of depositors, amount of deposits, and average account are shown in
the following table:
POSTAL SAVINGS-BANK RETURNS, 1895.
Country.
United Kingdom
France b
'.
Italy
Australasia
Belgium
Austria:
Savings department..
Banking department.
Hungary:
Savings department.Banking department.
Canada
India
-N etherlartds
Sweden
Cape Colony
Total
Number of
depositors.
Deposits, a
Average
deposit.
6,453,957
2, 488,075
2, 896,768
474, 635
882, 370
$489,344, 875
150, 691, 705
89, 724,465
70, 038, 925
63, 693, 274
$75.82
60.56
30.97
147.56
72.18
1.110,091
28, 363
22,124,156
27:.270,964
19.93
961.50
5,429,098
3,634,108
29, 252,784
28, 418, 460
18, 557, 651
10,696, 745
7, 675, 270
19.63
964.72
233.36
43.45
37.12
26.20
175.75
276, 565
3,767
125.353
653, 892
499,963
408, 288
43, 672
i 16,345,759
1, 016, 547,480
62.19
a Returns in pounds and francs converted to dollars on the basis of £1=$5 and francs 5=$1.
b Including Algeria and Tunis.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
LXV
Credit for a large portion of the foregoing information is due to Mr.
H. W. Wolff, who in the June (1897) number of the Journal of the
Eoyal Statistical Society gives a very elaborate description of savings
banks at home and abroad. The statistical results of his investigations,
set forth in great detail in the table reproduced on page 587, show the
population of the countries, the character and number of savings banks,
rates of interest paid, deposit limits, aggregate deposits, average
deposits, etc., to which is appended a column indicating the mode of
investment of deposits. The returns very generally are for the year
1895.
In order that the information above referred to may be presented in
the most concise form, the returns from the various classes of savings
institutions in each country have been consolidated in the following
table. The most notable as well as most satisfactory feature is the
enormous amount of deposits in savings banks of the United States, not
only relatively, but actually, being nearly 28 per cent of the aggregate
in reporting savings banks of the world. This is the more remarkable
when it i s considered that over 23 per cent of the total is held by the mutual
savings banks of the New England States and New York, New Jersey,
Pennsylvania, Delaware, and Maryland. The average savings account
is $378.31 and the average deposit per inhabitant $26.73. Second to the
United States in amount of deposits is Prussia. The savings banks of
that country hold only about one-half the amount of those in the
United States, although they have nearly one-third more depositors.
With nearly 5,000,000 depositors the Austro-Hungarian banks hold
13.4 per cent of the total, being exceeded only by the United States
and Prussia. France follows Austria-Hungary in volume of deposits
(12.6 per cent of the aggregate), although occupying the first place of
all countries in number of patrons, nearly 9,000,000. Second only to
France, in number of depositors, is the United Kingdom, and in amount
of deposits it is only slightly behind that country. Including her
dependencies the United Kingdom holds 16 per cent of the total deposits, but the United Kingdom alone only 12.3 per cent. The savings
deposits in the Australasian banks amount to over $130,000,000; in
banks of Canada and Newfoundland, about $60,000,000; India, over
$28,000,000, and other Crown colonies over $21,000,000. Next in
importance both in respect of deposits and depositors is Italy, the former amounting to $331,330,100 and the latter numbering 4,137,908.
The proportionate extent to which savings banks are used in each
country is shown in the column indicating the percentage of population
who are depositors. The maximum is 45.4 per cent in Denmark, where
also is the largest average deposit per inhabitant ($75.42), In Switzerland the percentage is 39.8 and the per capita average $59.60. In the
United Kingdom the percentage is 20.9 and the average $21.47; in
France, 23.6 per cent and $21.84; in Prussia, 19.5 per cent and $29.37;
in Austria-Hungary j 11.4 per cent and $20.60; in Italy, 13.3 per cent and
$11.01, and in the United States, 7.1 per cent and $26.73. Looking to
the column showing the average savings account it is seen that, with a
singleexeeption (Newfoundland), the United States has by far thehighest
average, viz, $378.31; Canada follows with an average of $327.97. Austria-Hungary has $180; Denmark, $165.95; Prussia, $150.23; Switzerland, $149.42; United Kingdom, $102.35; France, $92.33; Italy, $80.07.
H. Doc. 10
v
LXVI
REPORT OF THE COMPTROLLER OF THE CURRENCY
The following is the table referred to:
DEPOSITORS, AMOUNT OF DEPOSITS, AND AVERAGE DEPOSIT IN ALL SAVINGS
< BANKS, POPULATION OF THE COUNTRIES, PERCENTAGE OF POPULATION WHO ARE
DEPOSITORS, AND AVERAGE DEPOSIT PER INHABITANT, 1895.
Country.
Austria
Hungary
Bavaria
Belgium
Denmark
France
Italy
Netherlands
,
Norway
Prussia
Sweden
Switzerland
United Kingdom
Australasia
Canada
Cape Colony
India
Natal
^Newfoundland
Crown colonies, other.
United States
Total
Depositors.
Deposits.
Average
deposit.
Population.
3,924,902 $658,921,560
226,151,760
995, 397
57,638,605
665,943
113,500,080
1,145,408
999, 854 165,920, 525
8,986,631 829,783,735
4,137,908 331,330,100
43,073,460
740,024
60,533,905
540, 053
6,255,507 939,757,555
98,170, 720
1,460,858
1,196, 590 178,792,290
7,969,826 815,686,750
894, 879 130,485,880
57,578,975
175, 560
8,490,920
50,161
28,413,460
653,892
861, 520
6,401
2,821,420
12,275,455
114,491
4,875,519 1,844,357,798
$167.88
227.19
86.55
99.09
165.95
92.33
80.07
58.20
112.08
150.23
67.20
149.42
102.35
145.81
327. 97
169.21
43.60
123. 01
440.71
107.22
378.31
25,000,000
18,000, 000
C, 000, 000
6,850,000
2,200,000
38, 000, 000
31,000,000
4,250,COO
2,000,000
32,000, 000
5, 000,000
3,000,000
38,000,000
4, 200, 000
5, 250, 000
1, 600, 000
290, 000, 000
550, 000
198, 000
a 2, 000, 000
69,000, 000
! 45,796,767 6,604,546,473
144.21
584,098,000
Number
of deposi- Deposit
tors to
per inpopula- habitant.
tion.
Fer cent.
15.7
5.5
11.1
16.7
45.4
23.6
13.3
17.4
27
19.5
29.2
39.8
20.9
21.3
3.3
3.1
.2
1.3
3.2
5.7
7.1
$26.35
12.56
9.60
16.59
75.42
21.84
11.01
10.13
30.26
29.37
19.63
59.60
21.47
31.07
10.97
5.31
.01
1.57
14.25
6.14
26.73
7.8
11.31
a Partially estimated.
THE WORLD'S BANKINGS POWER.
Mr. M. G. Mulhall, tlie most distinguished of English statisticians,
in his History of Prices, issued in 1885, gives statistics relative to the
banking power, viz, capital, circulatiou, and deposits, oi the world.
For that year the figures for Europe, Australia, and Canada are
£2,043,000,000, or $10,215,000,000. In his Industries and Wealth of
Nations, issued in 1896, it is stated that in 1894 the banking power of
Europe, Australia, Cape Colony, Canada, and Argentina amounted to
£2,307,000,000, say $11^535,000,000, the deposits of savings banks being
excluded from the calculation. In order to make the returns upon the
subject as complete as possible, an investigation has been made by the
Comptroller by means of a letter of inquiry sent in March last, through
the courtesy of the Department of State, to each diplomatic and consular officer of the United States, in which a request was made for a
statement of the resources and liabilities of each class of banks in operation in the country to which the officer addressed was accredited.
The blanks accompanying the letter called for a statement of
resources and liabilities in the most concise form, and yet, with the
elimination of details ordinarily obtained from banks in this country,
the returns are only measurably satisfactory. In some instances investments in stocks, bonds, etc., are joined with loans and discounts; all
currency united in one item ; surplus and undivided profits added to
capital, and balances due from other banks included in deposits. In
other cases the correspondents were compelled to accept statements no
more recent than 1895 (none late have been made public), and the
returns for 1896 run from January to December. It has been necessary
in a few instances to draw upon the Economist and Bankers' Magazine
(London) for the necessary data, where the correspondents foil to obtain
REPORT OF THE COMPTROLLER OF THE CURRENCY. LXVII
or make returns. The information obtained, however, must be regarded
as adding to the fund extant on this subject. The number of banks
and branches (1,760 and 6,142 respectively) relative to which information has been received appears comparatively small, but it is to be
remembered that, especially in Europe, there is a great concentration
of banking capital, the six hundred banks in that division having
resources aggregating over ten and a quarter billion dollars, nearly 83
per cent of the total resources of foreign banks. The capital, including
surplus and undivided profits, circulation and deposits, and nonclassified liabilities, aggregate $12,358,411,246, or about $823,000,000 in
excess of the estimate of Mr. Mulhall in 1894. The returns by countries
are shown in detail in the table on page 591, and are consolidated in the
following statement:
RESOURCES AND LIABILITIES OF FOBEIGX COMMERCIAL BANKS AND BANKS OF ISSUE.
Europe.
Other
countries.
Total.
KESOURCES.
$3,899, 335,668 $1,292,012,848
2,016, 392, 501
145, 226,094
23,172, 366
18,080,698
a 974,119,774
20,819,646
475,519,053
57,647,778
528,890, 578
138,693, 319
938,444,785
108,362,079
323,706, 047
1, 397, 988,012
Loans and discounts
Stocks, bonds, etc
Banking premises
Gold
Silver
* Specie
Other currency
All otlier resources
Total
$5,191, 348, ?16
2,161, 018, 595
41, 253, 064
994, 939,420
533,166,831
667, 583, 897
1, 046, 806, 864
1,721, 694, 059
10,253,862,737
2,104,548,509
12, 358,411,246
904,609,720
337,437,978
2, 714,768, 668
4, 942, 011, 246
1,355, 035,125
363, 509,370
107,791,194
235,939,769
1,151, 706, 375
245, 601, 801
1, 268,119, 090
445, 229,172
2, 950, 708,437
6, 093,717,621
1,600, 636,926
2,104,548, 509
12,358,411,246
LIABILITIES.
Capital
Surplus and other undivided profits
Circulation
Deposits
All other liabilities
Total
Number of banks
Kumber of branches
#
,
600
4,349
1,160
1,793
1,760
6,142
a Includes $200,000,000, the approximate amount stated to be held by the Bank of England.
Eeferring again to MulhalFs statement for 1894, it is noted that the
banking power of the United States m that year was 30.9 per cent of
that of the world. The combined banking power of foreign banks in
1896, as shown by the foregoing table, was $10,757,771,320, and of the
United Staites (excluding savings institutions) $5,293,366,029, a total
of $16,051,137,349, the proportion of tlie United States being 32.9
per ceni.
Inquiry as to the minimum and maximum rates of interest charged
on loans and discounts shows the following: In Europe 1 to 7 per cent,
Asia 3.5 to 12.41, Australasia 4.5 to 7, Mexico 7 to 7.5, Central America
12 to 18, South America 6 to 17, Pacific and West India islands 3.5
to 18. Interest paid on deposits varies from 0 to 6 in Europe, 0 to
5.5 in Asia, 3.5 in Australasia, 3.25 to 3.5 in Mexico, 5 to 6 in Central
America, 3 to 5 in the Pacific and West India islands. The average
rate of dividends paid by the joint stock banks of the United Kingdom
was approximately 11 per cent during the year ended on June 30,1896.
In the other European States the rate varied, as reported, from 4 to 10
per cent, in Asia and Africa 3 to 12.26 per cent, Canada 7.5, Mexico 3
to 13.5, Central America 8 to 27, South America 8 to 25, and the islands
4 to 40.
LXVIII REPORT OF THE COMPTROLLER OF THE CURRENCY.
It has been thought best to reproduce the correspondence accompanying the banking returns, except mere letters of transmittal, containing,
as it does, valuable information not specially called for, but of interest
as bearing indirectly on the subject. The correspondence will be found
in the appendix.
BANKS OF THE UNITED KINGDOM.
The returns of the joint stock and private banks of the United Kingdom and of colonial and foreign joint stock banks with London officers,
from statements submitted on or about June 30 and December 31 of
each year, are published semiannually as a supplement to the London
Economist. The returns for the last three semiannual statements are
reproduced in the following table, the hundreds being omitted. The
number of banks and branches in the United Kingdom on June 30,
1896, was, it will bo seen, 147 and 4,332, respectively; on December 31,
1896, 145 and 4,601, respectively, and on June 30, 1897,139 and 4,725.
The assets of these banks on the earliest date mentioned were
£957,311,000, capital £84,835,000; deposits and accounts current,
£754,049,000, and circulation, £41,593,000. On December 31 of that
year the assets were £950,589,000; capital, £84,993,000; deposits, etc.,
£744,189,000, and circulation, £41,421,000. On the date of the last report
the resources amounted to £957,675,000; capital, £84,403,000; deposits,£757,311,000, and circulation, £42,878,000. It will be noted that the
notes in circulation of the Bank of England amount to about 65 per
cent of the total circulation outstanding. The resources of the colonial and foreign banks on June 30,1896, were £397,452,000; on December 31, 1896, £394,648,000, and on June 30, 1897, £382,264,000. The
following is the table referred to:
LXX
REPORT OF THE COMPTROLLER OF THE CURRENCY.
RESOURCES AND LIABILITIES OF JOINT-STOCK AND PRIVATE BANKS OF
LOOO's omitted.]
J U N E 30, 1896.
Eesources.
Num- Number
Cash and
Governof
ber of
and ment and •atmoney
banks. branches. Loans
call and
discounts. other se- short
nocurities.
tice.
IBank of England . . . . . .. . . . . . . . . . . . . . . .
1
11
£29,051
£32,027
£49,156
Banks of England and Wales, including Bank
of England
.. . .
........
Banks of Scotland . . . . . . .
Banks of Ireland... . . .
.
Banks of Isle of Man and Channel Islands...
97
10
9
4
2,794
1,015
509
14
361,271
63,465
32, 858
1,322
149,957
30,236
18, 381
932
173,892
21,937
10,214
359
120
27
147
29
24
4,332
458,916
25, 785
199,506
17, 532
206,403
12, 717
4,332
1,585
168
484, 701
163,776
141, 063
217,038
15,905
14,180
219,120
59, 556
27,402
200
6,085
789, 540
247,123
306, 078
Total .
Banks, private, of England and "Wales
Total joint-stock and private banks
Colonial joint-stock banks with London offices.
Foreign joint-stock banks with London offices.
Grand total
DECEMBER 30, 3896.
Bank of England
Banks of England and Wales, including Bank
of England
Banks of Isle of Man and Channel Islands...
1
11
£34, 563
£30,553
£34,159
95
10
9
3,062
1,016
509
372,588
64, 691
34, 042
1,251
148, 024
30, 530
18,180
1,074
150,029
22, 005
9,423
4
14
118
27
4,601
472,572
26,878
197,808
19,357
181 743
13,211
Total joint-stock and private banks
145
28
24
4,601
l,5G0
173
499,450
161, 074
110,737
217,165
13,541
14,091
194,954
55, 693
24,977
Grand total
197
6,334
771, 861
244, 797
275, 624
£35, 373
£30, 748
£36, 880 |
376, 229
64, 845
35,025
1,248
149,174
30, 364
17, 6o4
811
160, 881
22,452
8,921
251
T ot al
Banks, private, of England and Wales
Colonialjoint-stock banks with London offices.
Foreign joint- stock banks with London offices.
...
•
......
286
J U N E 30, 1897.
Bank of England
Banks of England and "Wales, including
Bank of England
Banks of Scotland
Banks of Ireland
Banks of Isle of Man and Channel I s l a n d s . . .
Total
Banks, private, of England and "Wales
Total joint-stock and private banks
Colonial j oint-stock banks with London offices Foreign joint-stock; banks with London offices.
Grand total
3,179
1,019
513
14
113
26
4,725
477, 347
25,933
197,983
18,883
192, 505
12, 511
139
29
23
4,725
1,573
172
503,280
164, 414
104, 581
216,866
14, 579
12,257
205, 010
48, 844
24, 242
191
6,470
772,275
243,702 j
278,102
REPORT OF THE COMPTROLLER OF THE CURRENCY. LXXI
THE UNITED KINGDOM IN JUNE AND DECEMBER, 1896, AND JUNE, 1897.
[000's omitted.]
J U X E 30, 1896.
Liabilities.
Besources.
Allother Total assets.
assets.
Eeserve
fund.
Capital.
Dividends
and
Notes in Deposits acnnpaid
and other circulation. current
counts.
profits.
£110,234
£14,553
£ 3 , COO
£89
£25,905
6,738
1,286
31
711,025
122,376
62,739
2,644
59,704
9,302
7,109
125
29,608
5,889
3,129
115
2,615
968
449
24
33,960
2,491
898, 785
58,526
76,241
8,594
38,742 1
4,056
36,451
8,402
3,168
957,311
247, 639
149,813
84, 835
31,734
21,569
38,742
7,712
6,917
48, 021
1,354,763
138,138 1
53, 371
A l l other
liabilities.
£27,034
£65,426
£132
28,146
7,275
5,907
53
564,538
94, 337
45,566
2,310
26,414
4,605
579
16
41,381
211
706,751
47,298
31,614
2,422
4,056
1,243
2,233
41,593
7,502
2,993
754,049
172, 726
86, 625
34, 036
26,723
29,475
7,532
52,088
1,013,400
90, 234
£193
£26,664
£54, 736
£129
.
D E C E M B E R 30, 1890.
£99, 275
£14, 553
£28,152
7,068
1,236
32
698, 793
124,293
62,882
2,643
59, 756
9,302
7,109
125
29,763
6,044
3,151
117'
3,314
983
503
26
27,675
7,335
6,134
53
549,969
95,695
45,553
2,306
28,316
4,934
432
14
36,488
2,532
888, 611
61,978
76,292
8,701
39,075
4,826
41,197
224
693,523
50, 666
33, 696
2,386
39,020
11, 468
2,465
950, 589
242,376
152, 272
84. 993
34,142
21,922
39, 075
7,739
7,422
4,826
1,332
2,359
41,421
7,721
3,045
744,189
162, 901
79, 927
36,082
28, 539
37, 594
52, 953
1,345,237
141, 057
54, 236
8,517
52,187
987, 017
102, 215
£ 3 , 000
J U X E 30, 1897.
£103, 002
£14,553
£3,000
£98
£28,485
£56, 716
£149
£21,595
7, 267
1.161
23
707,879
124,929
62, 739
2,334
59, 318
9,302
7,114
105
29,617
6,145
3,251
98
2,893
1,006
475
22
29,447
7, 370
5,795
54
565, 006
95, 882
45, 580
2,045
21, 598
5,223
525
9
SO, 046
2,465
897, 881
59,794
75,839
8,564
39, 111
4,396
42,666
212
708. 513
48,798
27,355
2, 219
82, 511
10. 660
2,687
957, 675
238, 497
143,767
84, 403
33, 795
21,859
39, 111
7,820
7,403
4,396
1,330
2,242
42, 878
7,567
2,854
757, 311
156,320
72, 604
29, 574
31, 664
30, 802
45, 858
1,339,939
140, 057
54, 334
7,968
53, 299
986, 235
98,040
LXXII
REPORT OF THE COMPTROLLER OF THE CURRENCY.
FOREIGN' BANKS OF ISSUE.
The specie, circulation, ratio of specie to circulation, deposits and
accounts current, loans and discounts, and rates of discount of the
principal European banks of issue on March 31,1897, are shown in
the April number of the Bulletin de Statistique, the amounts being
expressed in millions of francs. The statement is reproduced herewith:
Banks.
Specie.
Imperial Bank of Ger- Francs.
many
i..
1.076.2
Bank of Austria-Hungary
National Bank of Belgium
108.7
National Bank of Bulgaria
National Bank of Denmark
Bank of Spain
Bank of Finland
Bank of France
National B a n k of
Greece
2.7
Bank of Italy, of Naples, and Sicily
Bank of N o r w a y . . . . . . .
Bank of The Netherlands
Bank of Portugal
National Bank of Eoumania
Bank of England, of
Scotland, and of Ireland
Imperial' Bank of E,ua«
sia
Bank of Servia
Royal Bank of Sweden
and private banks
Banks of Switzerland..
Imperial Ottoman Bank
33.7
Total.
1,230.9
Gold.
Silver.
Current Loans
DisCircula- toSpecie
circu accounts
tion.
de- and dis- count
lation. and
counts.
I
rate.
posits.
Francs.
Francs.
Francs.
1,501.6
654.8
265
1,272.2
Per ct. Francs.
71
513.8
72
24.7
467.9
23
46.1
2
480
50.1
70
46
35
85
12.5
402.7
13.4
487.3
Francs.
1.032.7
701.2
422.9
72.2
51.9
444.6
36.4
1.138.8
Per ct.
3.5
4
3
8
78.8
213.2
20.1
3,918.4
269.4
3.6
1,226.8
114
1,055.8
67.7
3,702
112.9
41.7
57.8
0.5
444.1
36.4
74.8
1,025.2
69.8
331.9
13.7
380.1
52
66.4
26.7
176.8
48
413.4
322.9
10.7
11.2
217.1
94.3
5
4.5
3.5
5.5
13.9
54.6
59.8
129.3
47
118
1,166
30
1,011.4
2 421.4
7
43.8
87.1
96.4
4.9
2, 533. 8
24.7
7,244
19
2,224.7
4
5
5
2
965
747.5
48
447.2
1.1
692.7
14.9
4.5
6
168
190.6
14.2
37
50
240
569.1
325.3
130.3
533.6
697.9
98.5
4.5
3.5
3.5
14,199.4
75
4,471.7
7,541.7
MONETARY SYSTEMS AND WORLD'S STOCK OF MONEY.
The Director of the Mint has courteously enabled a presentation to
be made in this report of the latest compiled statistics relative to the
world's monetary systems and the stock of gold, silver, and paper currency. To the returns from 34 countries reported in 1896, are now
added those from the Cape Colony and South African Eepublic.
There has been no change during the past year in the monetary systems, nor have the ratios of gold to silver been disturbed. The stock of
gold has
increased from $4,143,700,000 in 189G to $4,359,600,000 in
1897^ t n e s t o c k of silver from $4,236,900,000 to $4,268,300,000, and the
uncovered paper from $2,558,000,000 to $2,565,800,000. The greater
portion of the gold, $3,293,700,000 (about 75 per cent), is held in the
United States, United Kingdom, France, Germany, and Russia. About
78 x>er cent of the silver is held in the following-named countries:
India, $950,000,000; China, $750,000,000; United States, $634,000,000;
France, $441,000,000; Straits Settlements, $242,000,000; Germany,
$212,000,000; United Kingdom, $121,000,000. The South American
Staites have in circulation $550,000,000 of uncovered paper currency;
Russia, $467,200,000; United States, $397,000,000; Austria-Hungary,
REPORT OF THE COMPTROLLER OF THE CURRENCY.
LXXIII
$177,600,000; Italy, $161,000,000; Germany, $123,800,000; France,
$119,200,000, and the United Kingdom $112,100,000.
During the year Kussia increased her supply of gold $98,300,000;
the United States, $24,100,000, and Austria-Hungary, $11,300,000.
The gold stock of the United Kingdom and France is practically
unchanged, but Germany and Italy have lost $20,500,000 and $3,500,000,
respectively. There has been but a slight increase in the stock of silver, Germany having added only about $5,800,000 and the United States
$3,100,000. The supply of silver in France has decreased about
$48,300,000. No other material changes are noted in the specie held.
The amount of uncovered paper circulation outstanding in the United
States has been reduced $27,400,000. In Austria-Hungary the currency of this character has decreased $26,900,000; in Italy, $7,500,000,
and in Germany, $2,300,000. The only material increase is in France,
namely, $21,200,000. The uncovered paper currency in Eussia, Spain,
and the South American States stands at about the same figures as in
1896.
A very interesting feature of this statement is the per capita amount
of each kind of money in the countries named. The per capita averages in the principal countries of the world are as follows: United
States, 23.70; United Kingdom, 20.65; France, 34.68; Germany, 18.95;
Austria-Hungary, 9.33, and Eussia, 8.95. The information referred to
is shown in the following table:
MONETARY SYSTEMS, POPULATION, AND APPROXIMATE STOCKS OF MONEY IN THE
AGGREGATE IN THE PRINCIPAL COUNTRIES OF THE WORLD IN 1897.
Countries.
i Ratio Ratio
Per capita.
Stock of silver.
be
I between tween
gold gold
Mone- and and iPopu- Stock
tary sys- full lim f"lation.
of
Uncov
tem.* legal
gold. Full Limered Gold.; Sil- Pa- Toited Total. paper.
ten- ten.tender tender.
per. tal.
der der
ail- silver.
Mil- Mil. Mil- Mil- Mil- Millto — lto— lions. lions. lions. lions. lions, lions.
3 : $558.7 $75.8 $634.5(t$397
1.55 $8.70 $5.45 $23.70
United States j . G. and si 15.9814.95 I 72.9
United King39.6 «584 !
, a 121.7 121.7 6112. 114.75 3.07 2.83 20. 65
dom
G
38.5 6 772 16386 b 57.9 443.9| 6119. 2 20.0511.53 3.10 34.68
Trance
G.ands
Germany
G
52.3 c654. 5 C95.2 c 117.6 212.8j 6123. 812. 51 4.07! 2.37J18.95
dl
6.4 c/35 d50
57
672. 5
47 8.9111.32 25.70
Belgium
G.ands
...do...
Italy.....
31.3 696. 618.9 6 26.5 45.4 6161 i 3.10 1.45 5.14! 9.69
k 10.7 10.7 6 14. 3
i 3.561 4. 77! 16. 33
Switzerland... . . . d o . . .
3
dl
...do...
1.5 6 26
2.2
23J . 68 11. 8112.72
Greece
d. 5 d.5
d<
18
49 6103 ! 2. 50; 2.72 5.7210.94
Spain
5.1 cl5. 5
9.5. 6 49. 8; 1. 08| 1.86 9.7612.70
Portugal
G
5.4 638. 6.*.
610.6
10.6 611. 8 7. 15; 1.96 2.1911.30
Roumania
G.ands
2.3 62. 7
1.7
62. 4 1. 18 2.04 1.04 4.26
...do...
61.7
Servia
Austria -Hun6177.6; 3.97i 1.41 3.95 9.33
45 6178. 623.7 6 40 I
gary
G
6 52.8 6 3.3
56.1 637.9; 4.4711.45 7.73 23.65
4.9 621
Netherlands .. G.ands
62 |
1.90 6.65
2
6 7.
6 3.8; 3.75J
Norway
G
6 4.9;
4.9 619 1-2.12 .98 3.80: 6.90
610. 6!
Sweden
...do...
6 5.4
2.3] 615. 4
5.4 6 6.4| 6.70', 2.35 2.7811.83
Denmark
...do...
126
fo8Q.
74.2,6467.2 4.
.59 3.70 8.95
6 32.3 d41.9i
Russia
22 I' cl 50
clO
d'60
Turkey
G. and s
40 •
! 2.27j 1.82 . . : . . ! 4.09
5 ;/>132. !
dl
Australasia ... G
622.5 26.42 1.40 4. 50 32. 32
7.81 c 129.3
66.4
6.4
116.58 .82
17.40
Egypt
...do...
13.01 dS. 6 6106
Mexico
S
106 •• 64 I .67 8.15! 3.07.11.89
6 Information furnished through United States
*G. (gold) S. (silver).
t Xational-bank notes, gold and currency certifi- representatives.
c Haupt.
cates and Unitecl States notes outstanding, less
d Estimate Bureau of the Mint.
gold coin and bullion in the Treasury.
/ London Economist.
a Money and Prices, United States State DefcC. Cramer Froy.
partment.
j July 1,1897; all other countries January 1,1897.
H. Doc. 10
vi
LXXIV
REPORT OF THE COMPTROLLER OF THE CURRENCY.
MONETARY SYSTEMS, POPULATION, AND APPROXIMATE STOCKS OF MONEY IN THE
AGGREGATE IN THE PRINCIPAL COUNTRIES OF THE WORLD IN 1897—Cont'd.
Countries.
Ratio Ratio
be- be
tween tween
gold gold
Mone- and
tary sys- full
tem.* legal ed
ten- tender der
silsilver. ver.
Stock
of
gold.
MilCentral Amerlto — lto — lions.
3.3
ican States.. S-.
South American States
doe.. | £
37.5
Japan
j Grands I 16.18
45
296
India
! . . . d o . . . 15
3f>0
China
Straits Settle£3.8'
ments
...do...
5.3
Canada
1.8;
Cuba
1
Haiti
3.3
Bulgaria
5
Siam
.1
Hawaii
Gands 15.98 14.95
1.7;
Cape Colony... G
South African
.8811
Republic
G
Total.
i
Per capita.
Stock of silver.
Uncov-j
ered j
paper
Full LimToited
Total.
I Gold. Sil- Pa- tal.
tender tender
ver. i per.
Mil- Mil- Millions. lions. lions.
$18.9
(265
<225 d $10
680.1 75.5 18.5
#950
(2750
c240
616
(25
dl.5
63
64
(23.4
(21
620 6193.4
61
65
a 37.5
a 29.
*G. (gold), S. (silver).
a Money and Prices, United States State Department.
6 Information furnished through United States
representatives.
c Haupt.
35
94
950
750
(2550
"h'dY
1.73 .9314.6717.33
1.78 2.09.
I 3.87
3.21
! 2.08..
2.08
I 63.68
242
63.68:
5
635 3.01; . 95 6.60 10.56
2.78;
3.61
1.5.
o no' .83
00!
o at
dl.5
4. 5 6 4.1
4 50; 4.10 12.60
2.06i.
2.36
(23.4
6.8|
4 38.68!.
193.4!
42.68
50 10 1.
22.06 . 5 8 .
22.64
65
a 1.2
. |4, 359.6|3, 615.8
Mil- Millions, lions.
$18.9 6 $8.4 $0.30 $5.73 $2.54 $8:57
1.2
36.50! 1.50
38
652.5 4,268.3 2, 565.8
(2 Estimate Bureau of the Mint.
e Except Venezuela and Chile.
gF. C.Harrison,
h Indian Currency Committee Report.
i Includes Aden and Perim, Ceylon, Hongkong,
Labuan, and Straits Settlements.
DIGEST.
Some years since the increasing importance of a knowledge on the
part of bankers of the law, as laid down by the Federal and State
courts, affecting the conduct of the banks, warranted the undertaking
of a compilation of decisions rendered in bank cases. In the report
herewith presented the digest is enlarged to 227 pages, embracing
about 1,400 decisions, accompanied by a table of cases alphabetically
arranged, together with an index of subjects affected by the court decisions cited.
APPENDIX AND VOLUME I I .
To the statistical information usually contained in the appendix of the
report several valuable tables have been added, notably classification
of the capital of national banks by States and geographical divisions;
comparative statement of the capital, bonds, and circulation by States,
etc. 5 resources, liabilities, specie, and lawful money reserve by States,
etc., at the date of every report during the year, and a condensed
statement of the principal items of the resources and liabilities of the
national banks in every State at the date of the last annual call, from
October 5,1863, to October 5,1897. Volume II contains statements of
the resources and liabilities of every national bank on October 5,1897,
The statements are arranged, alphabetically, by towns and States.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
LXXV
CONCLUSION.
In closing this, my final report to Congress, I can not forbear paying
a special tribute of respect to those who have been associated with me
during my incumbency of the office of Comptroller of the Currency.
The Deputy Comptrollers, the chief clerk, the chiefs of divisions, the
clerks, and all others in the office at Washington have been faithful in
their attention to duty and earnest in their efforts to promote the
efficiency of the service. The labor involved by the increased number
of bank examinations and the unprecedented number of bank failures
has more than doubled the work necessary to be done,-but no increase
in the force of employees has been made.
Not less intelligent and careful have been the bank examiners in the
field and the receivers in charge of failed banks. The effort of the
receivers is shown by the amount of money paid to creditors within the
past year, equaling one-sixth of the total amount of dividends paid out
to creditors of all failed banks in the history of the system. The difficulties confronting the examiners during the period of prolonged uncertainty affecting the banks of the country have been at times many and
intricate. In the first report which I submitted to Congress I recommended that a change be made in the method of compensating examiners from the fee system at present controlling to that of a fixed salary,
with an allowance for necessary traveling and other expenses.
This salary should be paid from a fund to be collected from the banks
by an assessment in lieu of the fee now charged against them for
examinations when made. The expense to the banks would not be
increased, but a more even distribution of salaries would be obtained.
With a fixed salary, instead of an already-determined fee, examiners
would be in position to apportion their time, in making examinations,
in accordance with the needs of the banks examined. Only in this way
can be had that complete scrutiny of a bank's affairs which is due to the
officers and shareholders and to its patrons and the general public.
JAMES H. ECKELS,
Comptroller of the Currency.
To the SPEAKER OF THE HOUSE OF REPRESENTATIVES.
DIAGRAM
, $6$, AM)
1320
1300
1280
1260
1240
1220
2 00
180
160
1/4-0
120
100
1080
1060
104-0
1020
1000
980
960
40
20
900
880
860
840
820
800
780
760
740
720
700
680
660
640
620
600
580
560
540
520
500
4-80
1889 1890
1992 1893
THE NATIONAL-BANK ACT
AS AMENDED,
WITH OTHER LAWS RELATING TO
NATIONAL BANKS.
H. Doc. 10
1
THE NATIONAL-BANK ACT, AS AMENDED, WITH OTHER LAWS
RELATING-TO NATIONAL BANKS.
(Index to sections of Revised Statutes, p. 83.)
CHAPTER ONE.
THE CURRENCY BUREAU.
1.
2.
3.
4.
5.
6.
The national-bank act.
Comptroller of the Currency.
His appointment, term, and salary.
His qualification.
Deputy Comptroller.
Interest in national banks prohibited.
7.
8.
9.
10.
11.
12.
Office clerks.
Seal of office.
Offices, vaults, etc.
Annual report.
When report is printed.
Number of copies to be printed.
1. THE NATIONAL-BANK ACT.—Sec. 1 of the act of June 20, 1874,
provides that the act entitled "An act tQ provide a national currency
secured by a pledge of United States bonds, and to provide for the
circulation and redemption thereof," approved June u third, eighteen
hundred and sixty-four, shall hereafter be known as the National-Bank
Act."
2. COMPTROLLER OF THE CURRENCY. (SEC. 324.) There shall be in
the Department of the Treasury a Bureau charged with the execution
of all laws passed by Congress relating to the issue and regulation of
a national currency secured by United States bonds, the chief officer
of which Bureau shall be called the Comptroller of the Currency, and
shall perform his duties under the general direction of the Secretary
of the Treasury.
3. His APPOINTMENT, TERM, AND SALARY. (SEC. 325.) The Comptroller of the Currency shall be appointed by the President, on the
recommendation of the Secretary of the Treasury, by and with the
advice and consent of the Senate, and shall hold his office for the term
of five years, unless sooner removed by the President, upon reasons to
be communicated by him to the Senate; and he shall be entitled to a
salary of five thousand dollars a year.
4. His QUALIFICATION. (SEC. 326.) The Comptroller of the Currency shall, within fifteen days from the time of notice of his appointment, take and subscribe the oath of office; and he shall give to the
United States a bond in the penalty of one hundred thousand dollars,
with not less than two responsible sureties, to be approved by the Secretary of the Treasury, conditioned for the faithful discharge of the
duties of his office.
5. DEPUTY COMPTROLLER. (SEC. 327.) There shall be in the Bureau
of the Comptroller of the Currency a Deputy Comptroller of the Currency, to be appointed by the Secretary, who shall be entitled to a
salary of two thousand eight hundred dollars a year, and who shall
possess the power and perform the duties attached by law to the office
of Comptroller during a vacancy in the office or during the absence or
inability of the Comptroller. The Deputy Comptroller shall also take
3
4
REPORT OF THE COMPTROLLER OF THE CURRENCY.
the oath of office prescribed by the Constitution and laws of the United
States, and shall give a like bond in the penalty of fifty thousand
dollars.
6. INTEREST IN NATIONAL BANKS PROHIBITED. (SEC. 329.)
It
shall not be lawful for the Comptroller or the Deputy Comptroller of
the Currency, either directly or indirectly, to be interested in any association issuiug national currency under the laws of the United States.
7. OFFICE CLERKS. (SEC. 328.) The Comptroller of the Currency
shall employ, from time to time, the necessary clerks, to be appointed
and classified by the Secretary of the Treasury, to discharge such duties
as the Comptroller shall direct.
8. SEAL OF OFFICE. (SEC. 330.) The seal devised by the Comptroller
of the Currency for his office, and approved by the Secretary of the
Treasury, shall continue to be the seal of office of the Comptroller,
and may be renewed when necessary. A description of the seal, with
an impression thereof, and a certificate of approval of the Secretary of
the Treasury, shall be filed in the office of the Secretary of State.
9. OFFICES, VAULTS, ETC. (SEC. 331.) There shall be assigned, from
time to time, to the Comptroller of the Currency, by the Secretary of
the Treasury, suitable rooms in the Treasury building for conducting
the business of the Currency Bureau, containing safe and secure fireproof vaults, in which the Comptroller shall deposit and safely keep all
the plates not necessarily in the possession of engravers or printers,
and other valuable things belonging to his department; and the Comptroller shall from time to time furnish the necessary furniture, stationery, fuel, lights, and other proper conveniences for the transaction of
the business of his office.
10. ANNUAL KEPORT. (SEC. 333.) The Comptroller of the Currency
shall make an annual report to Congress, at the commencement of its
session, exhibiting—
First. Condition of national banks.—A summary of the state and condition of every association from which reports have been received the
preceding year, at the several dates to which such reports refer, with
an abstract of the whole amount of banking capital returned by them,
of the whole amount of their debts and liabilities, the amount of circulating notes outstanding, and the total amount of means and resources,
specifying the amount of lawful money held by them at the times of
their several returns, and such other information in relation to such
associations as in his judgment may be useful.
Second. Closed banks.—A statement of the associations whose business has been closed during the year, with the amount of their circulation redeemed and the amount outstanding.
Third. Amendments proposed.—Any amendment to the laws relative
to banking by which the system may be improved and the security of
the holders of its notes and other creditors may be increased.
Fourth. Condition of other banks.—A statement exhibiting under
appropriate heads the resources and liabilities and condition of the
banks, banking companies, and savings banks organized under the laws
of the several States and Territories, such information to be obtained
by the Comptroller from the reports made by such banks, banking companies, and savings banks to the legislatures or officers of the different
States and Territories, and, where such reports can not be obtained,
the deficiency to be supplied from such other authentic sources as may
be available.
Fifth. Employes and expenses.—The names and compensation of the
clerks employed by him, and the whole amount of the expenses of the
banking department during the year.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
5
11. W H E N ANNUAL EEPORT IS PRINTED. (SEC. 3811.) When the
Annual Eeport of the Comptroller of the Currency upon the national
banks and banks under State and Territorial laws is completed, or
while it is in process of completion, if thereby the business may be
sooner dispatched, the work of printing shall be commenced, under the
superintendence of the Secretary, and the whole shall be printed and
ready for delivery on or before the first day of December next after the
close of the year to which the report relates.
12. NUMBER OF COPIES TO BE PRINTED.—The act of January 12,
1895, provides that there shall be printed of the Annual Keport of the
Comptroller of the Currency ten thousand copies; one thousand for the
Senate, two thousand for the House, and seven thousand for distribution by the Comptroller of the Currency.
CHAPTEE TWO.
ORGANIZATION AND POWERS OF NATIONAL BANKS,
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
Articles of association.
Organization certificate.
Execution of organization certificate.
Corporate powers.
Amount of capital stock required.
Shares of stock.
Payment of capital stock.
Enforcing payment of capital.
Restoration of capital.
Examination of organization proceedings.
Certificate of officers and directors.
Deposit of United States bonds.
Comptroller's certificate of authority.
Publication of certificate of authority.
Number and election of directors.
Qualifications of directors.
Qualifications of directors in Oklahoma.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.
Qualifications of voters at elections.
Oaths of directors.
Failure to hold annual election.
Vacancies in board of directors.
President shall be a director.
Organization of gold banks.
Conversion of gold banks.
Conversion of State banks.
Capital of State banks.
Converted banks may retain branches.
Personal liability of shareholders.
Exception for trustees, etc.
Amendment of articles restricted.
Increase of capital stock.
When increase becomes valid.
Reduction of capital stock.
Change of title and location.
Status of national banks organized
under the act of February 25,1863.
13. ARTICLES OF ASSOCIATION. (SEC. 5133.) Associations for carrying on the business of banking under this Title may be formed by any
number of natural persons, not less in any case than five. They shall
enter into articles of association, which shall specify in general terms
the object for which the association is formed, and may contain any
other provisions, not inconsistent with law, which the association may
see fit to adopt for the regulation of its business and the conduct of its
affairs. These articles shall be signed by the persons uniting to form
the association, and a copy of them shall be forwarded to the Comptroller of the Currency, to be filed and preserved in his office.
14. ORGANIZATION CERTIFICATE. (SEC. 5134.) The persons uniting
to form such an association shall, under their hands, make an organization certificate, which shall specifically state—
First. Title.—The name assumed by such association; which name
shall be subject to the approval of the Comptroller of the Currency.
Second. Location.—The place where its operations of discount and
deposit are to be carried on, designating the State, Territory, or District, and the particular county and city, town, or village.
Third. Capital stock.—The amount of capital stock and the number
of shares into which the same is to be divided.
6
REPORT OF THE COMPTROLLER OF THE CURRENCY,
Fourth. Shareholders.—The names and places of residence of the
shareholders and the number of shares held by each of them.
Fifth. Object of certificate.—The fact that the certificate is made to
enable such persons to avail themselves of the advantages of this
Title.
15. EXECUTION OF ORGANIZATION CERTIFICATE. (SEC. 5135.) The
organization certificate shall be acknowledged before a judge of some
court of record or notary public, and shall be, together with the
acknowledgment thereof, authenticated by the seal of such court or
notary, transmitted to the Comptroller of the Currency, who shall
record and carefully preserve the same in his office.
16. CORPORATE POWERS. (SEC. 5136.) Upon duly maidng and filing
articles of association and an organization certificate, the association
shall become, as from the date of the execution of its organization certificate, a body corporate, and as such, and in the name designated in
the organization certificate, it shall have power—
First. Seal.—To adopt and use a corporate seal.
Second. Term of existence.—To have succession for the period of
twenty years from its organization, unless it is sooner dissolved according to the provisions of its articles of association, or by the act of its
shareholders owning two-thirds of its stock, or unless its franchise
becomes forfeited by some violation of law.
Third. Contracts.—To make contracts.
Fourth. Suits.—To sue and be sued, complain and defend, in any
court of law and [or] equity, as fully as natural persons.
Fifth. Officers.—To elect or appoint directors, and by its board of
directors to appoint a president, vice-president, cashier, and other officers, define their duties, require bonds of them and fix the penalty
thereof, dismiss such officers or any of them at pleasure, and appoint
others to fill their places.
Sixth. Bylaws.—To prescribe, by its board of directors, by-laws not
inconsistent with law, regulating the manner in which its stock shall
be transferred, its directors elected or appointed, its officers appointed,
its property transferred, its general business conducted, and the privileges granted to it by law exercised and enjoyed.
Seventh. Incidental powers.—To exercise by its board of directors, or
duly authorized officers or agents, subject to law, all such incidental
powers as shall be necessary to carry on the business of banking; by
discounting and negotiating promissory notes, drafts, bills of exchange,
and other evidences of debt; by receiving deposits; by buying and selling exchange, coin, and bullion; by loaning money on personal security; and by obtaining, issuing, and circulating notes according to the
provisions of this Title; but no association shall transact any business
except such as is incidental and necessarily preliminary to its organization until it has been authorized by the Comptroller of the Currency
to commence the business of banking.
17. AMOUNT OF CAPITAL STOCK EEQUIRED. (SEC. 5138.) No association shall be organized under this Title with a less capital than one
hundred thousand dollars, except that banks with a capital of not less
than fifty thousand dollars may, with the approval of the Secretary of
the Treasury, be organized in any place the population of which does
not exceed six thousand inhabitants. No association shall be organized in a city the population of which exceeds fifty thousand persons
with a less capital than two hundred thousand dollars.
18. SHARES OF STOCK. (SEC. 5139.) The capital stock of each association shall be divided into shares of one hundred dollars each, and
REPORT OF THE COMPTROLLER OF THE CURRENCY.
7
be deemed personal property, and transferable on the books of the
association in such manner as may be prescribed in the by-laws or
articles of association. Every person becoming a shareholder by such
transfer shall, in proportion to his shares, succeed to all the rights and
liabilities of the prior holder of such shares.
19. PAYMENT OF CAPITAL STOCK. (SEC. 5140.) At least fifty per
centum of the capital stock of every association shall be paid in before
it shall be authorized to commence business; and the remainder of the
capital stock of such association shall be paid in installments of at least
ten per centum each, on the whole amount of the capital, as frequently
as one installment at the end of each succeeding month from the time
it shall be authorized by the Comptroller of the Currency to commence
business; and the payment of each installment shall be certified to the
Comptroller, under oath, by the president or cashier of the association.
20. ENFORCING PAYMENT OF CAPITAL. (SEC. 5141.) Whenever any
shareholder, or his assignee, fails to pay any installment on the stock
when the same is required by the preceding section to be paid, the
directors of such association may sell the stock of such delinquent shareholder at public auction, having given three weeks' previous notice
thereof in a newspaper published and of general circulation in the city
or county where the association is located, or if no newspaper is published in said city or county, then in a newspaper published nearest
thereto, to any person who will pay the highest price therefor, to be not
less than the amount then due thereon, with the expenses of advertisement and sale; and the excess, if any, shall be paid to the delinquent
shareholder. If no bidder can be found who will pay for such stock the
amount due thereon to the association, and the cost of advertisement
and sale, the amount previously paid shall be forfeited to the association, and such stock shall be sold as the directors may order, within
six months from the time of such forfeiture, and if not sold it sjiall be
canceled and deducted from the capital stock of the association.
21. BESTORATION OF CAPITAL. (SEC. 5141.) If any such cancellation
and reduction shall reduce the capital of the association below the minimum of capital required by law, the capital stock shall, within thirty
days from the date of such cancellation, be increased to the required
amount; in default of which a receiver may be appointed, according to
the provisions of section fifty-two hundred and thirty-four, to close up
the business of the association.
22. EXAMINATION OF ORGANIZATION PROCEEDINGS. (SEC. 5168.)
Whenever a certificate is transmitted to the Comptroller of the Currency, as provided in this Title, and the association transmitting the
same notifies the Comptroller that at least fifty per centum of its capital stock has been duly paid in, and that such association has complied
with all the provisions of this Title required to be complied with before
an association shall be authorized to commence the business of banking, the Comptroller shall examine into the condition of such association, ascertain especially the amount of money paid in on account of
its capital, the name and place of residence of each of its directors, and
the amount of the capital stock of which each is the owner in good faith,
and generally whether such association has complied with all the provisions of this Title required to entitle it to engage in the business of
banking.
23. CERTIFICATE OF OFFICERS AND DIRECTORS. (SEC. 5168.) And
shall cause to be made and attested by the oaths of a majority of the
directors, and by the president or cashier of the association, a statement of all the facts necessary to enable the Comptroller to determine
8
REPORT OF THE COMPTROLLER OF THE CURRENCY.
whether the association is lawfully entitled to commence the business
of banking.
24. DEPOSIT OF UNITED STATES BONDS. (SEC. 5159.) Every asso
ciation, after having complied with the provisions of this Title, preliminary to the commencement of the banking business, and before it shall
be authorized to commence banking business under this Title, shall
transfer and deliver to the Treasurer of the United States, as security
for its circulating notes, any United States registered bonds bearing
interest, to an amount where the capital is one hundred and fifty thousand dollars or less, of not less than one-fourth of the capital, and fifty
thousand dollars where the capital is in excess of one hundred and fifty
thousand dollars. (NOTE.—As amended by sec. 8 of the act of July
12, 1882.)
25. COMPTROLLER'S CERTIFICATE OF AUTHORITY. (SEC. 5169.)
If, upon a careful examination of the facts so reported, and of any
other facts which may come to the knowledge of the Comptroller,
whether by means of a special commission appointed by him for the
purpose of inquiring into the condition of such association, or otherwise, it appears that such association is lawfully entitled to commence
the business of barking, the Comptroller shall give to such association
a certificate, under his hand and official seal, that such association has
complied with all the provisions required to be complied with before
commencing the business of banking, and that such association is
authorized to commence such business. But the Comptroller may
withhold from an association his certificate authorizing the commencement of business whenever he has reason to suppose that the shareholders have formed the same for any other than the legitimate objects
contemplated by this title.
26. PUBLICATION OF CERTIFICATE OF AUTHORITY. (SEC. 5170.)
The association shall cause the certificate issued under the preceding
section to be published in some newspaper printed in the city or county
where the association is located, for at least sixty days next after the
issuing thereof; or, if no newspaper is published in such city or county,
then in the newspaper published nearest thereto.
27. NUMBER AND ELECTION OF DIRECTORS. (SEC. 5145.) The affairs
of each association shall be managed by not less than five directors,
who shall be elected by the shareholders at a meeting to be held at any
time before the association is authorized by the Comptroller of the Currency to commence the business of banking, and afterward at meetings
to be held on such day in January of each year as is specified therefor
in the articles of association. The directors shall hold office for one
year, and until their successors are elected and have qualified.
28. QUALIFICATIONS OF DIRECTORS. (SEC. 5146.) Every director
must, during his whole term of service, be a citizen of the United
States, and at least three-fourths of the directors must have resided in
the State, Territory, or District in which the association is located for
at least one year immediately preceding their election, and must be
residents therein during their continuance in office. Every director
must own, in his own right, at least ten shares of the capital stock of
the association of which he is a director. Any director who ceases to
be the owner of ten shares of the stock, or who becomes in any other
manner disqualified, shall thereby vacate his place.
29. QUALIFICATIONS OF DIRECTORS IN OKLAHOMA.—Sec. 17 of the
act of May 2,1890, provides " that the provisions of Title sixty-two of
the Eevised Statutes of the United States relating to national banks,
and all amendments thereto, shall have the same force and effect in
the Territory of Oklahoma as elsewhere in the United States:
REPORT OF THE COMPTROLLER OF THE CURRENCY.
9
^Provided, That persons otherwise qualified to act as directors shall
not be required to have resided in said Territory for more than three
months immediately preceding their election as such."
30. QUALIFICATIONS OF VOTERS AT ELECTIONS. (SEC. 5144.) In
all elections of directors, and in deciding all questions at meetings of
shareholders, each shareholder shall be entitled to one vote on each
share of stock held by him. Shareholders may vote by proxies duly
authorized in writing; but no officer, clerk, teller, or bookkeeper of such
association shall act as proxy; and no shareholder whose liability is
past due and unpaid shall be allowed to vote.
31. OATHS OF DIRECTORS. (SEC. 5147.) Each director, when appointed or elected, shall take an oath that he will, so far as the duty
devolves on him, diligently and honestly administer the affairs of such
association, and will not knowingly violate, or willingly permit to be
violated, any of the provisions of this Title, and that he is the owner
in good faith, and in his own right, of the number of shares of stock
required by this Title, subscribed by him, or standing in his name on
the books of the association, and that the same is not hypothecated
or in any way pledged as security for any loan or debt. Such oath, subscribed by the director making it, and certified by the officer before
whom it is taken, shall be immediately transmitted to the Comptroller
of the Currency, and shall be filed and preserved in his office.
32. FAILURE TO HOLD ANNUAL ELECTION. (SEC. 5149.) If, from
any cause, an election of directors is not made at the time appointed,
the association shall not for that cause be dissolved, but an election
may be held on any subsequent day, thirty days' notice thereof in all
cases having been given in a newspaper published in the city, town, or
county in which the association is located; and if no newspaper is
published in such city, town, or county such notice shall be published
in a newspaper published nearest thereto. If the articles of association do notfixthe day on which the election shall be held, or if no election is held on the day fixed, the day for the election shall be designated
by the board of directors in their by-laws, or otherwise; or if the directors fail to fix the day, shareholders representing two-thirds of the
shares may do so.
33. VACANCIES IN BOARD OF DIRECTORS. (SEC. 5148.) Any vacancy
in the board shall be filled by appointment by the remaining directors?
and any director so appointed shall hold his place until the next election.
34. PRESIDENT SHALL BE A DIRECTOR. (SEC. 5150.) One of the
directors, to be chosen by the board, shall be the president of the board.
35. ORGANIZATION OF GOLD BANKS. (SEC. 5185.) Associations may
be organized in the manner prescribed by this Title for the purpose
of issuing notes payable in gold.
36. CONVERSION OF GOLD BANKS.—The act of February 14,1880,
provides that any national gold bank organized under the provisions
of the laws of the United States may, in the manner and subject to the
provisions prescribed by section fifty-one hundred andfifty-fourof the
Eevised Statutes of the United States, for the conversion of banks
incorporated under the laws of any State, cease to be a gold bank and
become such an association as is authorized by section fifty-one hundred
and thirty-three, for carrying on the business of banking, and shall have
the same powers and privileges, and shall be subject to the same duties,
responsibilities, and rules, in all respects, as are by law prescribed for
such associations: Provided, That all certificates of organization which
shall be issued under this act shall bear the date of the original organization of each bank respectively as a gold bank.
10
REPORT OF THE COMPTROLLER OF THE CURRENCY
37. CONVERSION OF STATE BANKS. (SEC. 5154.) Any bank incorporated by special law, or any banking institution organized under a
general law of any State, may become a national association under this
Title by the name prescribed in its organization certificate; and in such
case the articles of association and the organization certificate may be
executed by a majority of the directors of the bank or banking institution; and the certificate shall declare that the owners of two-thirds of
the capital stock have authorized the directors to make such certificate,
and to change and convert the bank or banking institution into a national
association. A majority of the directors, after executing the articles
of association and organization certificate, shall have power to execute
all other papers, and to do whatever may be required to make its organ
ization perfect and complete as a national association. The shares of
any such bank may continue to be for the same amount each as they
were before the conversion, and the directors may continue to be the
directors of the association until others are elected or appointed in
accordance with the provisions of this chapter; and any State bank
which is a stockholder in any other bank, by authority of State laws,
may continue to hold its stock, although either bank, or both, may be
organized under and have accepted the provisions of this Title. When
the Comptroller of the Currency has given to such-association a certificate, under his hand and official seal, that the provisions of this Title
have been complied with, and that it is authorized to commence the
business of banking, the association shall have the same powers and
privileges, and shall be subject to the same duties, responsibilities, and
rules, in all respects, as are prescribed for other associations, originally
organized as national banking associations, and shall be held and
regarded as such an association. But no such association shall have a
less capital than the amount prescribed for associations organized under
this Title.
38. CAPITAL OF STATE BANKS. (SEC. 3410.) The capital of any State
bank or banking association which has ceased or shall cease to exist,
or which has been or shall be converted into a national bank, shall be
assumed to be the capital as it existed immediately before such bank
ceased to exist or was converted as aforesaid.
39. CONVERTED BANKS MAY EETAIN BRANCHES. (SEC. 5155.) It
shall be lawful for any bank or banking association, organized under
State laws and having branches, the capital being joint and assigned
to and used by the mother bank and branches in definite proportions, to
become a national banking association in conformity with existing laws
and to retain and keep in operation its branches, or such one or more
of them as it may elect to retain, the amount of the circulation redeemable at the mother bank and each branch to be regulated by the
amount of capital assigned to and used by each.
40. PERSONAL LIABILITY OF SHAREHOLDERS. (SEC. 5151.) The
shareholders of every national banking association shall be held individually responsible, equally and ratably, and not one for another, for
all contracts, debts, and engagements of such association to the extent
of the amount of their stock therein, at the par value thereof, in addition to the amount invested in such shares, except that shareholders
of any banking association now existing under State laws having not
less than five millions of dollars of capital actually paid in and a surplus of twenty per centum on hand, both to be determined by the
Comptroller of the Currency, shall be liable only to the amount invested
in their shares; and such surplus of twenty j>er centum shall be kept
undiminished, and be in addition to the surplus provided for in this
REPORT OF THE COMPTROLLER OF THE CURRENCY.
11
Title; and if at any time there is a deficiency in sucli surplus of twenty
per centum such association shall not pay any dividends to its shareholders until the deficiency is made good; and in case of such deficiency the Comptroller of the Currency may compel the association to
close its business and wind up its affairs under the provisions of chapter
four of this Title.
41. EXCEPTION FOR TRUSTEES, ETC. (SEC. 5152.) Persons holding stock as executors, administrators, guardians, or trustees shall not
be personally subject to any liabilities as stockholders; but the estates
and funds in their hands shall be liable in like manner and to the same
extent as the testator, intestate, ward, or person interested in such trust
funds would be if living and competent to act and hold the stock in his
own name.
42. AMENDMENT OF ARTICLES BESTRICTED.—Sec. 5139 provides
that no change shall be made in the articles of association of a national
bank by which the rights, remedies, or security of the existing creditors
of the association shall be impaired.
43. INCREASE OF CAPITAL STOCK. (SEC. 5142.) Any association
formed under this Title may, by its articles of association, provide for
an increase of its capital from time to time, as may be deemed expedient^ subject to the limitations of this Title. But the maximum of such
increase to be provided in the articles of association shall be determined by the Comptroller of the Currency. Sec. 1 of the act of May 1,
1886, provides that any national banking association may, with the
approval of the Comptroller of the Currency, by the vote of shareholders owning two-thirds of the stock of such association, increase
its capital stock, in accordance with existing laws, to any sum approved
by the said Comptroller, notwithstanding the limit fixed in its original
articles of association and determined by said Comptroller; and no
increase of the capital stock of any national banking ass6ciation either
within or beyond the limit fixed in its original articles of association
shall be made except in the manner herein provided.
44. W H E N INCREASE BECOMES VALID. (SEC. 5142.) And no increase
of capital shall be valid until the whole amount of such increase is
paid in, and notice thereof has been transmitted to the Comptroller
of the Currency, and his certificate obtained specifying the amount
of such increase of capital stock, with his approval thereof, and that it
has been duly paid in as part of the capital of such association.
45. REDUCTION OF CAPITAL STOCK. (SEC. 5143.) Any association
formed under this Title may, by the vote of shareholders owning twothirds of its capital stock, reduce its capital to any sum not below the
amount required by this Title to authorize the formation of associations,
but no such reduction shall be allowable which will reduce the capialof <the association below the amount required for its outstanding circut
lation, nor shall any such reduction be made until the amount of the
proposed reduction has been reported to the Comptroller of the Currency and his approval thereof obtained.
46. CHANGE OF TITLE AND LOCATION.—Sees. 2,3, and 4 of the act
of May 1,1886, provide:
SEC. 2. That any national banking association may change its name
or the place where its operations of discount and deposit are to be carried on to any other place within the same State, not more than thirty
miles distant, with the approval of the Comptroller of the Currency,
by the vote of shareholders owning two-thirds of the stock of such
association. A duly authenticated notice of the vote and of the new
name or location selected shall be sent to the office of the Comptroller
12
REPORT OF THE COMPTROLLER OF THE CURRENCY.
of the Currency, but no change of name or location shall be valid until
the Comptroller shall have issued his certificate of approval of the
same.
SEC. 3. That all debts, liabilities, rights, provisions, and powers of
the association under its old name shall devolve upon and inure to the
association under its new name.
SEC. 4. That nothing in this act contained shall be so construed as
in any manner to release any national banking association under its
old name or at its old location from any liability, or affect any action
or proceeding in law in which said association may be or become a
party or interested.
47. STATUS OF NATIONAL BANKS ORGANIZED UNDER THE ACT OF
FEBRUARY 25,1863. (SEC. 5156.) That nothing in this Title shall affect
any appointments made, acts done, or proceedings had or commenced
prior to the third day of June, eighteen hundred and sixty-four, in or
toward the organization of any national banking association under the
act of February twenty-five, eighteen hundred and sixty-three; but all
associations which on the third day of June, eighteen hundred and
sixty-four, were organized or commenced to be organized under that
act shall enjoy all the rights and privileges granted, and be subject to
all the duties, liabilities, and restrictions imposed by this Title, notwithstanding all the steps prescribed by this Title for the organization of
associations were not pursued, if such associations were duly organized
under that act.
CHAPTER THEEE.
BANK CIRCULATION.
48.
49.
50.
51.
52.
53.
54.
55.
56.
57.
58.
59.
60.
61.
62.
63.
64.
United States bonds defined.
Security for circulation.
Relation of bond deposit to capital.
Exchange of bonds.
Bonds held by Treasurer.
Record of bond transfers.
Notice of transfer.
Examination of bonds and records.
Annual examination of bonds.
General provisions respecting bonds.
Amount of circulation obtainable.
Preparation of bank circulation.
C irculation shall bear charter number.
Control of plates and dies.
Examination of plates and dies.
Circulation, for what receivable.
Circulation of gold banks.
65.
66.
67.
68.
69.
70.
71.
72.
73.
74.
75.
76.
77.
78.
79.
Worn-out or mutilated circulation.
Provisions for redeeming circulation.
Withdrawing circulation.
General provisions for withdrawing
circulation.
Circulation of extended banks.
Circulation of liquidating banks.
Circulation of closed banks.
Regulations for redemption records.
Redeemed notes to be canceled.
Redemption in United States notes.
Disposition of redemption account.
Redemption of incomplete circulation.
Banks take circulation at par.
Issue of other notes prohibited.
Fraudulent notes to be marked.
48. UNITED STATES BONDS DEFINED. (SEC. 5158.) The term "United
States bonds," as used throughout this chapter, shall be construed to
mean registered bonds of the United States.
49. SECURITY FOR CIRCULATION. (SEC. 5159.) Every association,
after having complied with the provisions of this Title, preliminary to
the commencement of the banking business, and before it shall be
authorized to commence banking business under this Title, shall transfer and deliver to the Treasurer of the United States, as security for
its circulating notes, any United States registered bonds, bearing interest, to an amount, where the capital is one hundred and fifty thousand
dollars or less, not less than one-fourth of the capital, and fifty thou-
REPORT OF THE COMPTROLLER OF THE CURRENCY.
13
sand dollars where the capital is in excess of one hundred and fifty
thousand dollars. Such bonds shall be received by the Treasurer upon
deposit, and shall be by him safely kept in his office until they shall be
otherwise disposed of in pursuance of the provisions of this Title j and
such of those banks having on deposit bonds in excess of that amount
are authorized to reduce their circulation by the deposit of lawful money
as provided by law: Provided, That the amount of such circulating
notes shall not exceed in any case ninety per centum of the par value
of the bonds deposited as herein provided. (NOTE.—As amended by
sec. 4 of the act of June 20,1874, and sec. 8 of the act of July 12,1882.)
50. BELATION OF BOND DEPOSIT TO CAPITAL. (SEC. 5160.) The
deposit of bonds made by each association shall be increased as its capital may be paid up or increased, so that every association shall at all
times have on deposit with the Treasurer registered United States bonds
to the amount required by law. And any association that may desire to
reduce its capital or close up its business and dissolve its organization
may take up its bonds upon returning to the Comptroller its circulating
notes in the proportion hereinafter required, or may take up any excess
of bonds beyond the amount required by law, and upon which no circulating notes have been delivered.
51. EXCHANGE OF BONDS. (SEC. 5161.) To facilitate a compliance
with the two preceding sections, the Secretary of the Treasury is authorized to receive from any association, and cancel, any United States coupon bonds, and to issue in lieu thereof registered bonds of like amount,
bearing a like rate of interest, and having the same time to run.
52. BONDS HELD BY TREASURER. (SEC. 5162.) All transfers of
United States bonds made by any association under the provisions of
this Title shall be made to the Treasurer of the United States in trust
for the association, with a memorandum written or printed on each
bond, and signed by the cashier, or some other officer of the association making the deposit. A receipt shall be given to the association,
by the Comptroller of the Currency, or by a clerk appointed by him
for that purpose, stating that the bond is held in trust for the association on whose behalf the transfer is made, and as security for the
redemption and payment of any circulating notes that have been or
may be delivered to such association. No assignment or transfer of
any such bond by the Treasurer shall be deemed valid unless countersigned by the Comptroller of the Currency,
53. EECORD OF BOND TRANSFERS. (SEC. 5163.) The Comptroller of
the Currency shall keep in his office a book in which he shall cause to
be entered, immediately upon countersigning it, every transfer or
assignmeut by the Treasurer, of any bonds belonging to a national
banking association, presented for his signature. He shall state in
such entry the name of the association from whose account the transfer
is made, the name of the party to whom it is made, and the par value
of the bonds transferred.
54. NOTICE OF TRANSFER. (SEC. 5164.) The Comptroller of the Currency shall, immediately upon countersigning and entering any transferor assignment by the Treasurer of any bonds belonging to a national
banking association, advise by mail the association from whose accounts
the transfer is made of the kind and numerical designation of the bonds
and the amount thereof so transferred.
55. EXAMINATION OF BONDS AND EECORDS. (SEC. 5165.) The Comptroller of the Currency shall have at all times, during office hours, access
to the books of the Treasurer of the United States for the purpose of
ascertaining the correctness of any transfer or assignment of the bonds
14
REPORT OF THE COMPTROLLER OF-THE CURRENCY.
deposited by an association, presented to the Comptroller to counter
sign; and the Treasurer shall have the like access to the book mentioned
in sectionfifty-onehundred and sixty-three, during office hours, to ascertain the correctness of the entries in the same; and the Comptroller
shall also at all times have access to the bonds on deposit with the
Treasurer to ascertain their amount and condition.
56. ANNUAL EXAMINATION OF BONDS. (SEC. 5166.) Every association having bonds deposited in the office of the Treasurer of the United
States shall, once or oftener in each liscal year, examine and compare
the bonds pledged by the association with the books of the Comptroller
of the Currency and with the accounts of the association, and, if they
are found correct, to execute to the Treasurer a certificate setting forth
the different kinds and the amounts thereof, and that the same are in
the possession and custody of the Treasurer at the date of the certificate.
Such examination shall be made at such time or times during the ordinary business hours as the Treasurer and the Comptroller, respectively,
may select, and may be made by an officer or agent of such association,
duly appointed in writing for that purpose; and his certificate before
mentioned shall be of like force and validity as if executed by the president or cashier. A duplicate of such certificate, signed bv the Treasurer, shall be retained by the association.
57. GENERAL PROVISIONS RESPECTING BONDS. (SEC. 5167.) The
bonds transferred to and deposited with the Treasurer of the United
States by any association for the security of its circulating notes shall
be held exclusively for that purpose until such notes are redeemed,
except as provided in this Title. The Comptroller of the Currency shall
give to any such association powers of attorney to receive and appropriate to its own use the interest on the bonds which it has so transferred to the Treasurer; but such powers shall become inoperative
whenever such association fails to redeem its circulating notes. Whenever the market or cash value of any bonds thus deposited with the
Treasurer is reduced below the amount of the circulation issued for the
same the Comptroller may demand and receive the amount of such
depreciation in other United States bonds at cash value, or in money,
from the association, to be deposited with the Treasurer as long as such
depreciation continues. And the Comptroller, upon the terms prescribed by the Secretary of the Treasury, may permit an exchange to
be made of any of the bonds deposited with the Treasurer by any association for other bonds of the United States authorized to be received
as security for circulating notes if he is of opinion that such an
exchange can be made without prejudice to the United States; and he
may direct the return of any bonds to the association which transferred
the same, in sums of not less than one thousand dollars, upon the surrender to him and the cancellation of a proportionate amount of such
circulating notes: Provided, That the remaining bonds which shall
have been transferred by the association offering to surrender circulating notes are equal to the amount required for the circulating notes not
surrendered by such association, and that the amount of bonds in the
hands of the Treasurer is not diminished below the amount required to
be kept on deposit with him, and that there has been no failure by the
association to redeem its circulating notes, nor any other violation by
it of the provisions of this Title, and that the market or cash value of
the remaining bonds is not below the amount required for the circulation issued for the same.
58. AMOUNT OF CIRCULATION OBTAINABLE.—Sec. 10 of the act of
July 12,1882, provides that upon a deposit of bonds as described by
REPORT OP THE COMPTROLLER OF THE CURRENCY.
15
sections fifty-one hundred and fifty-nine and fifty one hundred and
sixty, the association making the same shall be entitled to receive from
the Comptroller of the Currency circulating notes of different denomi
nations, in blank, registered and countersigned as provided by law,
equal in amount to ninety per centum of the current market value, not
exceeding par, of the United States bonds so transferred and delivered,
and at no time shall the total amount of such notes issued to any such
association exceed ninety per centum of the amount at such time
actually paid in of its capital stock.
59. PREPARATION OF BANK CIRCULATION. (SEC. 5172.) In order to
furnish suitable notes for circulation, the Comptroller of the Currency
shall, under the direction of the Secretary of the Treasury, cause plates
and dies to be engraved, in the best manner to guard against counterfeiting and fraudulent alterations, and shall have printed therefrom,
and numbered, such quantity of circulating notes, in blank, of the
denominations of five dollars, ten dollars, twenty dollars, fifty dollars,
one hundred dollars, five hundred dollars, and one thousand dollars, as
may be required to supply the associations entitled to receive the same.
Such notes shall express upon their face that they are secured by United
States bonds, deposited with the Treasurer of the United States, by the
written or engraved signatures of the Treasurer and Eegister, and by
the imprint of the seal of the Treasury; and shall also express upon
their face the promise of the association receiving the same to pay on
demand, attested by the signatures of the president or vice-president
and cashier; and shall bear such devices and such other statements,
and shall be in such form, as the Secretary of the Treasury shall, by
regulation, direct.
60. CIRCULATION SHALL BEAR CHARTER NUMBER.—Sec. 5 of
the
act of June 20,1874, provides that the Comptroller of the Currency
shall, under such rules and regulations as the Secretary of the Treasury
may prescribe, cause the charter numbers of the associations to be
printed upon all national-bank notes which may be hereafter issued
by him.
61. CONTROL OF PLATES AND DIES. (SEC. 5173.) The plates and
special dies to be procured by the Comptroller of the Currency for the
printing of such circulating notes shall remain under his control and
direction.
62. EXAMINATION OF PLATES AND DIES. (SEC. 5174.) The Comptroller of the Currency shall cause to be examined, each year, the
plates, dies, but pieces [bed pieces], and other material from which the
national-bank circulation is printed, in whole or in part, and file in his
office annually a correct list of the same. Such material as shall havo
been used in the printing of the notes of associations which are in
liquidation, or have closed business, shall be destroyed, under such
regulations as shall be prescribed by the Comptroller of the Currency
and approved by the Secretary of the Treasury. The expenses of any
such examination or destruction shall be paid out of any appropriation
made by Congress for the special examination of national banks and
bank-note plates.
63. CIRCULATION, FOR WHAT EECEIVABLE. (SEC. 5182.) After any
association receiving circulating notes under this Title has caused its
promise to pay such notes on demand to be signed by the president or
vice-president and cashier thereof, in such manner as to make them
obligatory promissory notes, payable on demand at its place of business, such association may issue and circulate the same as money.
And the same shall be received at par in all parts of the United States
16
REPORT OP THE COMPTROLLER OF THE CURRENCY.
in payment of taxes, excises, public lands, and all other dues to the
United States, except duties on imports; and also for all salaries and
other debts and demands owing by the United States to individuals,
corporations, and associations within the United States, except interest
on the public debt, and in redemption of the national currency.
64. CIRCULATION OF GOLD BANKS. (SEC. 5185.) Associations may
be organized in the manner prescribed by this Title for the purpose of
issuing notes payable in gold; and upon the deposit of any United
States bonds bearing interest payable in gold with the Treasurer of the
United States, in the manner prescribed for other associations, it shall
be lawful for the Comptroller of the Currency to issue to the association
making the deposit circulating notes of different denominations, but
none of them of less than five dollars, and not exceeding in amount
eighty per centum of the par value of the bonds deposited, which shall
express the promise of the association to pay them, upon presentation
at the office at which they are issued, in gold coin of the United States,
and shall be so redeemable.
65. WORN-OUT OR MUTILATED CIRCULATION. (SEC. 5184.) It shall
be the duty of the Comptroller of the Currency to receive worn-out or
mutilated circulating notes issued by any banking association, and
also, on due proof of the destruction of any such circulating notes, to
deliver in place thereof to the association other blank circulating notes
to an equal amount. Such worn-out or mutilated notes, after a memorandum has been entered in the proper books, in accordance with
such regulations as may be established by the Comptroller, as well as
all circulating notes which shall have been paid or surrendered to be
canceled, shall be macerated in presence of four persons, one to be
appointed by the Secretary of the Treasury, one by the Comptroller of
the Currency, one by the Treasurer of the United States, and one by
the association, under such regulations as the Secretary of the Treasury may prescribe. A certificate of such maceration, signed by the
parties so appointed, shall be made in the books of the Comptroller,
and a duplicate thereof forwarded to the association whose notes are
thus canceled.
66. PROVISIONS FOR KEDEEMING CIRCULATION.—Sec. 3 of the
act
of June 20,1874, provides that every association organized, or to be
organized, under the provisions of the said act, and of the several acts
amendatory thereof, shall at all times keep and have on deposit in the
Treasury of the United States, in lawful money of the United States,
a sum equal to five per centum of its circulation, to be held and used
for the redemption of such circulation; which sum shall be counted as
a part of its lawful reserve, as provided in section two of this act; and
when the circulating notes of any such associations, assorted or unassorted, shall be presented for redemption, in sums of one thousand
dollars or any multiple thereof, to the Treasurer of the United States,
the same shall be redeemed in United States notes. All notes so
redeemed shall be charged by the Treasurer of the United States to the
respective associations issuing the same, and he shall notify them
severally, on the first day of each month, or oftener, at his discretion,
of the amount of such redemptions; and whenever such redemptions
for any association shall amount to the sum of five hundred dollars,
such association so notified shall forthwith deposit with the Treasurer
of the United States a sum in United States notes equal to the amount
of its circulating notes so redeemed. And all notes of national banks,
worn, defaced, mutilated, or otherwise unfit for circulation, shall, when
received by any assistant treasurer, or at any designated depositary of
REPORT OF THE COMPTROLLER OF THE CURRENCY.
17
the United States, be forwarded to the Treasurer of the United States
for redemption as provided herein. And when such redemptions have
been so reimbursed, the circulating notes so redeemed shall be forwarded to the respective associations by which they were issued; but
if any of such notes are worn, mutilated, defaced, or rendered otherwise unfit for use, they shall be forwarded to the Comptroller of the
Currency and destroyed, and replaced as now provided bylaw: Provided, That each of said associations shall reimburse to the Treasury
the charges for transportation and the costs for assorting such notes;
and the associations hereafter organized shall also severally reimburse
to the Treasury the cost of engraving such plates as shall be ordered
by each association respectively; and the amount assessed upon each
association shall be in proportion to the circulation redeemed, and be
charged to the fund on deposit with the Treasurer.
67. WITHDRAWING CIRCULATION.—Sec. 4 of the act of June 20,
1874, provides that any association organized under this act, or any of
the acts of which this is an amendment, desiring to withdraw its circulating notes, in whole or in part, may, upon the deposit of lawful money
with the Treasurer of the United States in sums of not less than nine
thousand dollars, take up the bonds which said association has on
deposit with the Treasurer for the security of such circulating notes,
which bonds shall be assigned to the bank in the manner specified in
the nineteenth section of the national-bank act; and the outstanding
notes of said association, to an amount equal to the legal-tender notes
deposited, shall be redeemed at the Treasury of the United States, and
destroyed as now provided by law: Provided, That the amount of the
bonds on deposit for circulation shall not be reduced below fifty thousand dollars.
68. GENERAL PROVISIONS FOR WITHDRAWING CIRCULATION.—
Sees. 8 and 9 of the act of July 12,1882, provide: (SEC. 8.) That the
national banks which shall hereafter make deposits of lawful money
for the retirement in full of their circulation shall, at the time of their
deposit, be assessed for the cost of transporting and redeeming their
notes then outstanding, a sum equal to the average cost of the redemption of national-bank notes during the preceding year, and shall thereupon pay such assessment; and all national banks which have heretofore made or shall hereafter make deposits of lawful money for the
reduction of their circulation shall be assessed, and shall pay an assessment in the manner specified in section three of the act approved June
twentieth, eighteen hundred and seventy-four, for the cost of transporting and redeeming their notes redeemed from such deposits subsequently to June thirtieth, eighteen hundred and eighty-one.
SEC. 9. That any national banking association now organized, or
hereafter organized, desiring to withdraw its circulating notes, upon a
deposit of lawful money with the Treasurer of the United States, as
provided in section four of the act of June twentieth, eighteen hundred
and seventy-four, or as provided in this act, is authorized to deposit
lawful money and withdraw a proportionate amount of the bonds held
as security for its circulating notes in the order of such deposits; and
no national bank which makes any deposit of lawful money in order to
withdraw its circulating notes shall be entitled to receive any increase
of its circulation for the period of six months from the time it made
such deposit of lawful money for the purpose aforesaid: Provided,
That not more than three millions of dollars of lawful money shall be
deposited during any calendar month for this purpose: And provided
further, That the provisions of this section shall not apply to bonds
H. Doc. 10
2
18
REPORT OF THE COMPTROLLER OF THE CURRENCY.
called for redemption b$ the Secretary of the Treasury, nor to the withdrawal of circulating notes in consequence thereof.
69. CIRCULATION OF EXTENDED BANKS.—Sec. 6 of the act of July
12,1882, provides that the circulating notes of any association so extending the period of its succession which shall have been issued to it prior
to such extension shall be redeemed at the Treasury of the United
States, as provided in section three of the act of June twentieth, eighteen hundred and seventy-four, entitled "An act fixing the amount of
United States notes, providing for redistribution of national bank currency, and for other purposes," and such notes when redeemed shall be
forwarded to the Comptroller of the Currency, and destroyed, as now
provided by law; and at the end of three years from the date of the
extension of the corporate existence of each bank the association so
extended shall deposit lawful money with the Treasury of the United
States sufficient to redeem the remainder of the circulation which was
outstanding at the date of its extension, as provided in sections fifty-two
hundred and twenty-two, fifty-two hundred and twenty-four, and fiftytwo hundred and twenty-five of the Eevised Statues; and any gain that
may arise from the failure to present such circulating notes for redemption shall inure to the benefit of the United States; and from time to time,
as such notes are redeemed or lawful money deposited therefor as provided herein, new circulating notes shall be issued as provided for by
this act, bearing such devices, to be approved by the Secretary of the
Treasury, as shall make them readily distinguishable from the circulating notes heretofore issued: Provided, however, That each banking association which shall obtain the benefit of this act shall reimburse to the
Treasury the cost of preparing the plate or plates for such new circulating notes as shall be issued to it.
70. CIRCULATION OF LIQUIDATING BANKS. (SEC. 5225.) Whenever
the Treasurer has redeemed any of the notes of an association which
has commenced to close its affairs, he shall cause the notes to be mutilated and charged to the redemption account of the association; and
all notes so redeemed by the Treasurer shall, every three months, be
certified to and destroyed in the manner prescribed in section fifty-one
hundred and eighty-four.
71. CIRCULATION OF CLOSED BANKS.—Sec. 8 of the act of June 20,
1874, provides: And it shall be the duty of the Treasurer, assistant
treasurers, designated depositaries, and national bank depositaries of
the United States to assort and return to the Treasury for redemption
the notes of such national banks as have failed, or gone into voluntary
liquidation for the purpose of winding up their affairs, and of such as
shall hereafter so fail or go into liquidation.
72. REGULATIONS FOR EEDEMPTION RECORDS. (SEC. 5232.) The
Secretary of the Treasury may, from time to time, make such regulations
respecting the disposition to be made of circulating notes after presentation at the Treasury of the United States for payment, and respecting
the perpetuation of the evidence of the payment thereof, as may seem
to him proper.
73. REDEEMED NOTES TO BE CANCELED. (SEC. 5233.) All notes of
national banking associations presented at the Treasury of the United
States for payment shall, on being paid, be canceled.
74. REDEMPTION IN UNITED STATES NOTES.—Sec. 3 of the act
approved June 20,1874, provides that when the circulating notes of
any such associations, assorted or unassorted, shall be presented for
redemption, in sums of one thousand dollars or any multiple thereof, to
the Treasurer of the United States, the same shall be redeemed in
United States notes.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
19
75. DISPOSITION OF EEDEMPTION ACCOUNT.—Sec. 6 of the act of
July 14,1890, provides that upon the passage of this act the balancer
standing with the Treasurer of the. United States to the respective
credits of national banks for deposits made to redeem the circulating
notes of such banks, and all deposits thereafter received for like purpose, shall be covered into the Treasury as a miscellaneous receipt, and
the Treasury of the United States shall redeem from the general cash
in the Treasury the circulating notes of said banks which may come
into his possession subject to redemption; and upon the certificate of
the Comptroller of the Currency that such notes have been received by
him and that they have been destroyed and that no new notes will be
issued in their place, reimbursement of their amount shall be made to
the Treasurer, under such regulations as the Secretary of the Treasury
may prescribe, from an appropriation hereby created, to be known as
" national-bank notes, redemption account." But the provisions of
this act shall not apply to the deposits received under section three of
the act of June twentieth, eighteen hundred and seventy-four, requiring
every national bank to keep in lawful money with the Treasurer of the
United States a sum equal to five per centum of its circulation, to be
held and used for the redemption of its circulating notes; and the balance remaining of the deposits so covered shall, at the close of each
month, be reported on the monthly public debt statement as debt of
the United States bearing no interest.
76. EEDEMPTION OF INCOMPLETE CIRCULATION.—The act of July
28,1892, provides that the provisions of the Revised Statutes of the
United States, providing for the redemption of national-bank notes,
shall apply to all national bank notes that have been or maybe issued
to, or received by, any national bank, notwithstanding such notes may
have been lost by or stolen from the bank and put in circulation without the signature or upon the forged signature of the president or vicepresident and cashier.
77. BANKS TAKE CIRCULATION AT PAR. (SEC. 5196.) Every national banking association formed or existing under this Title shall
take and receive at par, for any debt or liability to it, any and all notes
or bills issued by any lawfully organized national banking association.
But this provision shall not apply to any association organized for the
purpose of issuing notes payable in gold.
78. ISSUE OF OTHER NOTES PROHIBITED. (SEC.5183.) Konational
banking association shall issue post notes or any other notes to circulate as money than such as are authorized by the provisions of this
Title.
79. FRAUDULENT NOTES TO BE MARKED.—Sec. 5 of the act of June
30,1876, provides that all United States officers charged with the receipt
or disbursement of public moneys, and all officers of national banks,
shall stamp or write in plain letters the word " counterfeit," " altered,"
or "worthless" upon all fraudulent notes issued in the form of and
intended to circulate as money which shall be presented at their places
of business 5 and if such officer shall wrongfully stamp any genuine
note of the United States, or of the national banks, they shall, upon
presentation, redeem such notes at the face value thereof.
20
REPORT OF THE COMPTROLLER OF THE CURRENCY.
CHAPTER FOUR.
TAX ON CIRCULATION.
80.
81.
82.
83.
84.
85.
86.
Tax on circulation.
Semiannual return of circulation.
Proceedings on default.
Enforcing tax on circulation.
Refunding excess tax.
Circulation, when exempt from tax.
Tax on unauthorized circulation.
87. Semiannual return of taxable circulation.
88. Failure to make such return.
89. Tax on converted bank circulation.
90. Tax provisions restricted.
91. Taxation of notes, etc.
80. TAX ON CIRCULATION. (SEC. 5214.) In lieu of all existing taxes,
every association shall pay to the Treasurer of the United States, in the
months of January and July, a duty of one-half of one per centum each
half year upon the average amount of its notes in circulation.
81. SEMIANNUAL EETURN OF CIRCULATION. (SEC. 5215.) In order
to enable the Treasurer to assess the duties imposed by the preceding
section, each association shall, within ten days from the first days of
January and July of each year, make a return, under the oath of its
president or cashier, to the Treasurer of the United States, in such
form as the Treasurer may prescribe, of the average amount of its notes
in circulation for the six months next preceding the most recent first
day of January or July. Every association which fails so to make such
return shall be liable to a penalty of two hundred dollars, to be collected
either out of the interest as it may become due such association on the
bonds deposited with the Treasurer, or, at his option, in the manner in
which penalties are to be collected of other corporations under the laws
of the United States.
82. PROCEEDINGS ON DEFAULT. (SEC. 5216.) Whenever any association fails to make the half-yearly return required by the preceding
section, the duties to be paid by such association shall be assessed upon
the amount of notes delivered to such association by the Comptroller
of the Currency,
83. ENFORCING TAX ON CIRCULATION. (SEC. 5217.) Whenever an
association fails to pay the duties imposed by the three preceding sections, the sums due may be collected in the manner provided for the collection of United States taxes from other corporations; or the Treasurer
may reserve the amount out of the interest, as it may become due, on
the bonds deposited with him by such defaulting association.
84. REFUNDING EXCESS TAX. (SEC. 5218.) In all cases where an
association has paid or may pay in excess of what may be or has been
found due from it, on account of the duty required to be paid to the
Treasurer of the United States, the association may state an account
therefor, which, on being certified by the Treasurer of the United
States, and found correct by the Comptroller of the Treasury, shall be
refunded in the ordinary manner by warrant on the Treasury.
85. CIRCULATION, WHEN EXEMPT FROM TAX. (SEC. 3411.) Whenever the outstanding circulation of any bank, association, corporation,
company, or person is reduced to an amountnotexceedingfiveper centum
of the chartered or declared capital existing at the time the same was
issued, said circulation shall be free from taxation; and whenever any
bank which has ceased to issue notes for circulation deposits in the
Treasury of the United States, in lawful money, the amount of its outstanding circulation, to be redeemed at par, under such regulations as
the Secretary of the Treasury shall prescribe, it shall be exempt from
any tax upon such circulation.
REPORT OP THE COMPTROLLER OF THE CURRENCY.
21
86. TAX ON UNAUTHORIZED CIRCULATION.—Sees. 19, 20, and 21 of
the act of February 8,1875, provide:
SEC. 19. That every person, firm, association, other than nationalbank associations, and every corporation, State bank, or State banking
association shall pay a tax of ten per centum on the amount of their
own notes used for circulation and paid out by them.
SEC. 20. That every such xierson, firm, association, corporation, State
bank, or State banking association, and also every national banking
association, shall pay a like tax of ten per centum on the amount of
notes of any person, firm, association, other than a national banking
association, or of any corporation, State bank, or State banking association, or of any town, city, or municipal corporation, used for circulation and paid out by them.
SEC. 21. That the amount of such circulating notes, and of the tax
due thereon, shall be returned, and the tax paid at the same time, and
in the same manner, and with like penalties for failure to return and
pay the same, as provided by law for the return and payment of taxes
on deposits, capital, and circulation imposed by the existing provisions
of internal revenue law.
87. SEMIANNUAL RETURN OF TAXABLE CIRCULATION. (SEC. 3414.)
A true and complete return of the monthly amount of circulation, as
aforesaid^ and of the monthly amount of notes of persons, town, city,
or municipal corporation, State banks, or State banking associations
paid out as aforesaid for the previous six months, shall be made and
rendered in duplicate on the first day of December and the first day of
June by each of such banks, associations, corporations, companies, or
persons, with a declaration annexed thereto, under the oath of such
person, or of the president or cashier of such bank, association, corporation, or company, in such form and manner as may be prescribed by the
Commissioner of Internal Revenue, that the same contains a true and
faithful statement of the amounts subject to tax, as aforesaid; and one
copy shall be transmitted to the collector of the district in which any
such bank, association, corporation, or company is situated, or in which
such person has his place of business, and one copy to the Commissioner
of Internal Revenue.
88. FAILURE TO MAKE SUCK RETURN. (SEC. 3415.) In default of the
returns provided in the preceding section the amount of circulation,
and notes of persons, town, city, and municipal corporations, State
banks, and State banking associations paid out, as aforesaid, shall be
estimated by the Commissioner of Internal Revenue, upon the best
information he can obtain. And for any refusal or neglect to make
return and payment any such bank, association, corporation, company,
or person so in default shall pay a penalty of two hundred dollars,
besides the additional penalty and forfeitures provided in other cases.
89. TAX ON CONVERTED BANK CIRCULATION. (SEC. 3416.) Whenever any State bank or banking association has been converted into a
national banking association, and such national banking association
has assumed the liabilities of such State bank or banking association,
including the redemption of its bills, by any agreement or understanding whatever with the representatives of such State bank or banking
association, such national banking association shall be held to make
the required return and payment on the circulation outstanding, so long
as such circulation shall exceed five per centum of the capital before
such conversion of such State bank or banking association.
90. TAX PROVISIONS RESTRICTED. (SEC. 3417.) The provisions of
this chapter relating to the tax on the circulation of banks and to
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REPORT OF THE COMPTROLLER OF THE CURRENCY.
their returns, except as contained in sections thirty-four hundred and
eleven, thirty-four hundred and twelve, thirty-four hundred and thirteen, and thirty-four hundred and sixteen, and such parts of sections
thirty-four hundred and fourteen and thirty-four hundred and fifteen
as relate to the tax of ten per centum on certain notes, shall not apply
to associations which are taxed under and by virtue of Title "NATIONAL
BANKS."
91. TAXATION OF NOTES, ETC. (SEC.
3701.) All stocks, bonds,
Treasury notes, and other obligations of the United States shall be
exempt from taxation by or understate or municipal or local authority.
The act of August 13,1894, provides: (SEC. 1.) That circulating notes of
national banking associations and United States legal-tender notes and
other notes and certificates of the United States, payable on demand
and circulating or intended to circulate as currency, and gold, silver,
or other coin shall be subject to taxation as money on hand or on
deposit under the laws of any State or Territory: Provided, That any
such taxation shall be exercised in the same manner and at th£ same
rate that any such State or Territory shall tax money or currency circulating as money within its jurisdiction.
SEC. 2. That the provisions of this act shall not be deemed or held
to change existing laws in respect of the taxation of national banking
associations.
CHAPTER FIVE.
REGULATION OF THE BANKING BUSINESS.
92. Laws governing certain associations.
93. Place of business.
94. Reserve cities and reserve requirements.
95. Reserve not maintained.
96. Reserve agents' balances counted as
reserve.
97. Clearing-house certificates counted
as reserve.
98. Redemption fund counted as reserve.
99. United States note certificates
counted as reserve.
100. Redemption of such certificates.
101. United States gold certificates
counted as reserve.
102. Reserve requirements for gold banks.
103. Reserve deposit in central reserve
city.
104. Additional reserve cities.
105. Additional central reserve cities.
106. Real estate.
107. Interest.
108. Penalty for unlawful interest.
109. Surplus and dividends.
110. Restriction on loans.
111. Associations must not hold their own
stock.
112. Restriction on bank's liability.
113. Improper use of bank circulation.
114. Unearned dividends prohibited.
115. Assessment for impairment of capital.
116. Provision for enforcement of assessment.
117. Prohibition against uncurrent notes.
118. List of shareholders.
119. Reports of condition.
120. Verification of such reports.
121. Reports of dividends and earnings.
122. Penalty for failure to report.
123. Reports of other banks.
124. State taxation of national banks.
125. National-bank examiners.
126. Qualification for examiner.
127. Compensation of examiners.
128. Examinations in District of Columbia.
129. Limitation of visitorial powers.
130. Use of "National" in titles.
92. LAWS GOVERNING CERTAIN ASSOCIATIONS. (SEC. 5157.) The
provisions of chapters two, three, and four [three,five,and seven of this
edition] of this Title, which are expressed without restrictive words, as
applying to "national banking association," or to " associations," apply
to all associations organized to carry on the business of banking under
any act of Congress.
93. PLACE OF BUSINESS. (SEC. 5190) The usual business of each
national banking association shall be transacted at an office or banking
house located in the place specified in its organization certificate.
REPOKT OF THE COMPTROLLER OF THE CURRENCY.
23
94. RESERVE CITIES AND RESERVE REQUIREMENTS. (SEC. 5191.)
Every national banking association in either of the following cities:
Albany, Baltimore, Boston, Cincinnati, Chicago, Cleveland, Detroit,
Louisville, Milwaukee, New Orleans, New York, Philadelphia, Pittsburgh, Saint Louis, San Francisco, and Washington, shall at all times
have on hand, in lawful money of the United States, an amount equal
to at least twenty five per centum of the aggregate amount of its depos
its; and every other association shall at all times have on hand, in lawful money of the United States, an amount equal to at least fifteen per
centum of the aggregate amount of its deposits.
95. RESERVE NOT MAINTAINED. (SEC. 5191.) Whenever the lawful
money of any association in any of the cities named shall be below the
amount of twenty-five per centum of its deposits, and whenever the
lawful money of any other association shall be below fifteen per centum
of its deposits, such association shall not increase its liabilities by making any new loans or discounts otherwise than by discounting or purchasing bills of exchange payable at sight, nor make any dividend of
its profits until the required proportion between the aggregate amount
of its deposits and its lawful money of the United States has been
restored. And the Comptroller of the Currency may notify any association, whose lawful-money reserve shall be below the amount above
required to be kept on hand, to make good such reserve; and if such
association shall fail for thirty days thereafter so to make good its
reserve of lawful money, the Comptroller may, with the concurrence of
the Secretary of the Treasury, appoint a receiver to wind up the business of the association, as provided in section fifty-two hundred and
thirty-four.
96. RESERVE AGENTS' BALANCES COUNTED AS RESERVE. (SEC.
5192.) Three-fifths of the reserve of fifteen per centum required by the
preceding section to be kept may consist of balances due to an association from associations approved by the Comptroller of the Currency,
organized under the act of June three, eighteen hundred and sixty-four,
or under this Title, and doing business in the cities of Albany, Baltimore, Boston, Charleston, Chicago, Cincinnati, Cleveland, Detroit,
Louisville, Milwaukee, New Orleans, New York, Philadelphia, Pittsburg, Richmond, Saint Louis, San Francisco, and Washington.
97. CLEARING-HOUSE CERTIFICATES COUNTED AS RESERVE.—
Clearing-house certificates, representing specie or lawful money specially deposited for the purpose, of any clearing-house association shall
also be deemed to be lawful money in the possession of any association
belonging to such clearing house, holding and owning such certificate,
within the preceding section.
98. REDEMPTION FUND COUNTED AS RESERVE.—Sec. 3 of the act
of June 20,1874, provides that the five per cent redemption fund, which
shall at all times be kept on deposit with the Treasurer of the United
States, shall be counted as a part of the lawful reserve.
99. UNITED STATES NOTE CERTIFICATES COUNTED AS RESERVE.
(SEC. 5193.) The Secretary of the Treasury may receive United States
notes on deposit, without interest, from any national banking associations, in sums of not less than ten thousand dollars, and issue certificates therefor in such form as he may prescribe, in denominations of
not less than five thousand dollars, and payable on demand in United
States notes at the place where the deposits were made. The notes so
deposited shall not be counted as part of the lawful-money reserve of
the association; but the certificates issued therefor may be counted as
part of its lawful-money reserve, and may be accepted in the settlement
24
REPORT. OF THE COMPTROLLER OF THE CURRENCY,
of clearing-house balances at the places where the deposits therefor
were made.
100. REDEMPTION OF SUCH CERTIFICATES. (SEC. 5194.) The power
conferred on the Secretary of the Treasury, by the preceding section
shall not be exercised so as to create any expansion or contraction of
the currency; and United States notes for which certificates are issued
under that section, or other United States notes of like amount, shall
be held as special deposits in the Treasury and used only for redenip
tion of such certificates.
101. UNITED STATES GOLD CERTIFICATES COUNTED AS RESERVE.-—
Sec. 12 of the act of July 12,1882, provides that the Secretary of the
Treasury is authorized and directed to receive deposits of gold coin
with the Treasurer or assistant treasurers of tlie United States, in sums
not less than twenty dollars, and to issue certificates therefor in denominations of not less than twenty dollars each, corresponding with the
denominations of United States notes. The coin deposited for or representing the certificates of deposit shall be retained in the Treasury
for the payment of the same on demand. Said certificates shall be
receivable for customs, taxes, and all public dues, and when so received
may be reissued; and such certificates, as also silver certificates, when
held by any national banking association, shall be counted as part of
its lawful reserve; and no national banking association shall be a member of any clearing house in which such certificates shall not be receivable in the settlement of clearing-house balances: Provided. That the
Secretary of the Treasury shall suspend the issue of such gold certificates whenever the amount of gold coin and gold bullion in the Treasury
reserved for the redemption of United States notes falls below one
hundred millions of dollars; and the provisions of section fifty-two
hundred and seven of the Revised Statutes shall be applicable to the
certificates herein authorized and directed to be issued.
102. RESERVE REQUIREMENTS FOR GOLD BANKS. (SEC. 5186.)
Every association organized for the purpose of issuing notes payable
in gold shall at ail times keep on hand not less than twenty-live per
centum of its outstanding circulation, in gold or silver coin of the
United States; and shall receive at par in the payment of debts the
gold notes of every other such association which at the time of such
payment is redeeming its circulating notes in gold coin of the United
States, and shall be subject to all the provisions of this Title: Provided, That, in applying the same to associations organized for issuing
gold notes, the terms "lawful money" and "lawful money of the
United States v shall be construed to mean gold or silver coin of the
United States; and the circulation of such association shall not be
within the limitation of circulation mentioned in this Title.
103. RESERVE DEPOSIT IN CENTRAL RESERVE CITY. (SEC. 5195.)
Each association organized in any of the cities named in section fiftyone hundred and ninety-one may keep one-half of its lawful-money
reserve in cash deposits in the city of New York. But the foregoing
provision shall not apply to associations organized and located in the
city of San Francisco for the purpose of issuing notes payable in gold.
This section shall not relieve any association from its liability to redeem
its circulating notes at its own counter at par in lawful money on
demand.
104. ADDITIONAL RESERVE CITIES.—Sec. 1 of the act of March 3,
1887, provides that whenever three-fourths in number of the national
banks located in any city of the United States having a population of
fifty thousand people shall make application to the Comptroller of the
REPORT OF THE COMPTROLLER OF THE CURRENCY.
25
Currency, in writing, asking that the name of the city in which such
banks are located shall be added to the cities named in sections fiftyone hundred aijd ninety-one and fifty-one hundred and ninety-two of
the Eevised Statutes, the Comptroller shall have authority to grant
such request, and every bank located in such city shall at all times
thereafter have on hand, in lawful money of the United States, an
amount equal to at least twenty-five per centum of its deposits, as provided in sectionsfifty-onehundred and ninety-one andfifty-onehundred
and ninety-five of the Revised Statutes.
105. ADDITIONAL CENTRAL EESERVE CITIES.—Sec. 2 of the act of
March 3, 1887, provides that whenever three-fourths in number of the
national banks located in any city of the United States having a population of two hundred thousand x>eople shall make application to the Comptroller of the Currency, in writing, asking that such city may be a central
reserve city, like the city of New York, in which one-half of the lawfulmoney reserve of the national banks located in other reserve cities may
be deposited, as provided in sectionfifty-onehundred and ninety-five of
the Revised Statutes, the Comptroller shall have authority, with the
approval of the Secretary of the Treasury, to grant such request, and
every bank located in such city shall at all times thereafter have on
hand, in lawful money of the United States, twenty-five per centum of
its deposits, as provided in section fifty-one hundred and ninety-one oi
the Revised Statutes.
106. REAL ESTATE. (SEC. 5137.) A national banking association may
purchase, hold, and convey real estate for the following purposes, and
for no others:
First. Such as shall be necessary for its immediate accommodation
in the transaction of its business.
Second. Such as shall be mortgaged to it in good faith by way of
security for debts previously contracted.
Third. Such as shall be conveyed to it in satisfaction of debts previously contracted in the course of its dealings.
Fourth. Such as it shall purchase at sales under judgments, decrees,
or mortgages held by the association, or shall purchase to secure debts
due to it.
But no such association shall hold the possession of any real estate
under mortgage, or the title and possession of any real estate purchased
to secure any debts due to it, for a longer period than five years.
107. INTEREST. (SEC. 5197.) Any association may take, receive,
reserve, and charge on any loan or discount made, or upon any note,
bill of exchange, or other evidences of debt, interest at the rate allowed
by the laws of the State, Territory, or District where the bank is
located, and no more, except that where by the laws of any State a
different rate is limited for banks of issue organized under State laws,
the rate so limited shall be allowed for associations organized or existing in any such State under this Title. When no rate is fixed by the
laws of the State, or Territory, or District, the bank may take, receive,
reserve, or charge a rate not exceeding seven per centum, and such
interest may be taken in advance, reckoning the days from which the
note, bill, or other evidence of debt has to run. And the purchase, discount, or sale of a bona fide bill of exchange, payable at another place
than the place of such purchase, discount, or sale, at not more than the
current rate of exchange for sight drafts in addition to the interest,
shall not be considered as taking or receiving a greater rate of interest.
108. PENALTY FOR UNLAWFUL INTEREST. (SEC. 5198.) The taking,
receiving, reserving, or charging a rate of interest greater than is
26
REPOET OF THE COMPTROLLER OF THE CURRENCY.
allowed by the preceding section, when knowingly done, shall be deemed
a forfeiture of the entire interest which the note, bill, or other evidence
of debt carries with it, or which has been agreed to be paid thereon.
In case the greater rate of interest has been paid, the person by whom
it has been paid, or his legal representatives, may recover back, in an
action in the nature of an action of debt, twice the amount of the interest thus paid from the association taking or receiving the same, provided such action is commenced within two years from the time the
usurious transaction occurred.
109. SURPLUS AND DIVIDENDS. (SEC. 5199.) The directors of any
association may semiannualiy declare a dividend of so much of the net
profits of the association as they shall judge expedient; but each association shall, before the declaration of a dividend, carry one-tenth part
of its net profits of the precediug half year to its surplus fund until
the same shall amount to twenty per centum of its capital stock.
110. RESTRICTION ON LOANS. (SEC. 5200.) The total liabilities to
any association, of any person, or of any company, corporation, or firm
for money borrowed, including in the liabilities of a company or firm
the liabilities of the several members thereof, shall at no time exceed
one-tenth part of the amount of the capital stock of such association
actually paid in. But the discount of bills of exchange drawn in good
faith against actually existing values, and the discount of commercial
or business paper actually owned by the person negotiating the same
shall not be considered as money borrowed.
111. ASSOCIATIONS MUST NOT HOLD THEIR OWN STOCK. (SEC.
5201.) No association shall make any loan or discount on the security
of the shares of its own capital stock, nor be the purchaser or holder of
any such shares, unless such security or purchase shall be necessary
to prevent loss upon a debt previously contracted in good faith; and
stock so purchased or acquired shall, within six months from the time
of its purchase, be sold or disposed of at public or private sale; or, in
default thereof, a receiver may be appointed to close up the business of
the association, according to section fifty two hundred and thirty-four.
112. RESTRICTION ON BANK'S LIABILITY. (SEC. 5202.) No association
shall at any time be indebted, or in any way liable, to an amount
exceeding the amount of its capital stock at such time actually paid in
and remaining undiminished by losses or otherwise, except on account
of demands of the nature following:
First. Notes of circulation.
Second. Moneys deposited with or collected by the association.
Third. Bills of exchange or drafts drawn against money actually on
deposit to the credit of the association, or due thereto.
Fourth. Liabilities to the stockholders of the association for dividends and reserve profits.
113. IMPROPER U S E OF BANK CIRCULATION. (SEC. 5203.) No association shall, either directly or indirectly, pledge or hypothecate any of
its notes of circulation for the purpose of procuring money to be paid
in on its capital stock, or to be used in its banking operations, or otherwise; nor shall any association use its circulating notes, or any part
thereof, in any manner or form, to create or increase its capital stock.
114. UNEARNED DIVIDENDS PROHIBITED. (SEC. 5204.) No association, or any member thereof, shall, during the time it shall continue its
banking operations, withdraw, or permit to be withdrawn, either in the
form of dividends or otherwise, any portion of its capital. If losses
have at any time been sustained by any such association equal to or
exceeding its undivided profits then on hand, no dividend shall be
EEPORT OF THE COMPTROLLER OF THE CURRENCY,
27
made; and no dividend shall ever be made by any association, while it
continues its banking operations, to an amount greater than its net
profits then on hand, deducting therefrom its losses and bad debts.
All debts due to any associations, on which interest is past due and
unpaid for a period of six months, unless the same are well secured,
and in process of collection, shall be considered bad debts within the
meaning of this section. But nothing in this section shall prevent
the reduction of the capital stock of the association under section
fifty-one hundred and forty-three.
115. ASSESSMENT FOR IMPAIRMENT OF CAPITAL. (SEC. 5205.)
Every association which shall have failed to pay up its capital stock, as
required by law, and every association whose capital stock shall have
become impaired by losses or otherwise, shall, within three months after
receiving notice thereof from the Comptroller of the Currency, pay the
deficiency in the capital stock, by assessment upon the shareholders
pro rata for the amount of capital stock held by each; and the Treasurer of the United States shall withhold the interest upon all bonds
held by him in trust for any such association, upon notification from
the Comptroller of the Currency, until otherwise notified by him. If
any such association shall fail to pay up its capital stock, and shall
refuse to go into liquidation, as provided by law, for three months after
receiving notice from the Comptroller, a receiver may be appointed to
close up the business of the association, according to the provisions of
section fifty-two hundred and thirty-four.
116. PROVISION FOR ENFORCEMENT OF ASSESSMENT.—Sec. 4 of the
act of June 30,1876, provides that if any shareholder or shareholders
of a bank shall neglect or refuse, after three months7 notice, to pay the
assessment, as provided in this section, it shall be the duty of the board
of directors to cause a sufficient amount of the capital stock of such
shareholder or shareholders to be sold at public auction (after thirty
days' notice shall be given by posting such notice of sale in the office
of the bank and by publishing such notice in a newspaper of the city
or town in which the bank is located, or in a newspaper published
nearest thereto) to make good the deficiency; and the balance, if any,
shall be returned to such delinquent shareholder or shareholders.
117. PROHIBITION AGAINST UNCURRENT NOTES. (SEC. 5206.) No
association shall at any time pay out on loans or discounts, or in purchasing drafts or bills of exchange, or in payment of deposits, or in any
other mode pay or put in circulation the notes of any bank or banking
association which are not, at any such time, receivable, at par, on
deposit, and in payment of debts by the association so paying out or
circulating such notes; nor shall any association knowingly pay out or
put in circulation any notes issued by any bank or banking association
which at the time of such paying out or putting in circulation is not
redeeming its circulating notes in lawful money of the United States.
118. LIST OF SHAREHOLDERS. (SEC. 5210.) The president and
cashier of every national banking association shall cause to be kept at
all times a full and correct list of the names and residences of all the
shareholders in the association, and the number of shares held by each,
in the office where its business is transacted. Such list shall be subject
to the inspection of all the shareholders and creditors of the association,
and the officers authorized to assess taxes under State authority, during business hours of each day in which business may be legally transacted. A copy of such list, on the first Monday of July of each year,
verified by the oath of such president or cashier, shall be transmitted
to the Comptroller of the Currency.
28
REPORT OF THE COMPTROLLER OF THE CURRENCY.
119. BEPORTS OF CONDITION. (SEC. 5211.) Every association shall
make to the Comptroller of the Currency not less than five reports during each year, according to the form which maybe prescribed by him,
verified by the oath or affirmation of the president or cashier of such
association, and attested by the signature of at least three of the
directors. Each such report shall exhibit, in detail and under appropriate heads, the resources and liabilities of the associations at the
close of business on any past day by him specified, and shall be transmitted to the Comptroller within five days after the receipt of a request
or requisition therefor from him, and in the same form in which it is
made to the Comptroller shall be published in a newspaper published
in the place where such association is established, or if there is no
newspaper in the place, then in one published nearest thereto in the
same county, at the expense of the association) and such proof of
publication shall be furnished as may be required by the Comptroller.
The Comptroller shall also have power to call for special reports from
any particular association whenever in his judgment the same are
necessary in order to a full and complete knowledge of its condition.
120. VERIFICATION OF SUCH BEPORTS.—The act of February 26,
1881, provides that the oath or affirmation required by section fifty-two
hundred and eleven of the Eevised Statutes, verifying the returns made
by national banks to the Comptroller of the Currency, when taken
before a notary public properly authorized and commissioned by the
State in which such notary resides and the bank is located, or any other
officer having an official seal, authorized in such State to administer
oaths, shall be a sufficient verification as contemplated by said section
fifty-two hundred and eleven: Provided, That the officer administering
the oath is not an officer of the bank.
121. EEPORTS OF DIVIDENDS AND EARNINGS. (SEC. 5212.) In addition to the reports required by the preceding section, each association
shall report to the Comptroller of the Currency, within ten days after
declaring any dividend, the amount of such dividend and the amount
of net earnings in excess of such dividend. Such reports shall be
attested by the oath of the president or cashier of the association.
122. PENALTY FOR FAILURE TO REPORT. (SEC. 5213.) Every association which fails to make and transmit any report required under
either of the two preceding sections shall be subject to a x>enalty of
one hundred dollars for each day after the periods, respectively, therein
mentioned, that it delays to make and transmit its report. Whenever
any association delays or refuses to pay the penalty herein imposed,
after it has been assessed by the Comptroller of the Currency, the
amount thereof may be retained by the Treasurer of the United States,
upon the order of the Comptroller of the Currency, out of the interest,
as it may become due to the association, on the bonds deposited with
him to secure circulation. All sums of money collected for penalties
under this section shall be paid into the Treasury of the United States.
123. EEPORTS OF OTHER BANKS.—Sec. 6 of the act of June 30,1876,
provides that all savings banks or savings and trust companies organized under authority of any act of Congress shall be, and are hereby,
required to make, to the Comptroller of the Currency, and publish, all
fche reports which national banking associations are required to make
and publish under the provisions of sectionsfifty-twohundred and eleven,
fifty-two hundred and twelve, andfifty-twohundred and thirteen of the
Eevised Statutes, and shall be subject to the same penalties for failure
to make or publish such reports as are therein provided; which penalties may be collected by suit before any court of the United States in
REPORT OF THE COMPTROLLER OP THE CURRENCY.
29
the district in which said savings banks or savings and trust companies may be located. And all savings or other banks now organized, or
which shall hereafter be organized in the District of Columbia, under
any act of Congress, which shall have capital stock paid up in whole
or in part, shall be subject to all the provisions of the Revised Statutes,
and of all acts of Congress applicable to national banking associations,
so far as the same may be applicable to such savings or other banks:
Provided, That such savings banks now established shall not be required
to have a paid-in capital exceeding one hundred thousand dollars.
324. STATE TAXATION OF NATIONAL BANKS. (SEC. 5219.) Nothing
herein shall prevent all the shares in any association from being
included in the valuation of the personal property of the owner or
holder of such shares, in assessing taxes imposed by authority of the
State within which the association is located; but the legislature of
each State may determine and direct the manner arid place of taxing
all the shares of national banking associations located within the State,
subject only to the two restrictions, that the taxation shall not be at a
greater rate than is assessed upon other moneyed capital in the hands
of individual citizens of such State, and that the shares of any national
banking association owned by nonresidents of any State shall be taxed
in the city or town where the bank is located, and not elsewhere.
Nothing herein shall be construed to exempt the real property of associations from either State, county, or municipal taxes, to the same
extent, according to its value, as other real property is taxed.
125. NATIONAL-BANK EXAMINERS. (SEC. 5240.) The Comptroller of
the Currency, with the approval of the Secretary of the Treasury,
shall, as often as shall be deemed necessary or proper, appoint a suitable person or persons to make an examination of the affairs of every
banking association, who shall have power to make a thorough examination into all the affairs of the association, and in doing so to examine
any of the officers and agents thereof on oath; and shall make a full
and detailed report of the condition of the association to the Comptroller.
126. QUALIFICATION FOR EXAMINER. (SEC. 5240.) But no person
shall be appointed to examine the affairs of any banking association
of which he is a director or other officer.
127. COMPENSATION OF EXAMINERS. (SEC. 5240.) All persons appointed to be examiners of national banks not located in the redemption cities specified in section five thousand one hundred and ninety-two
of the Eevised Statutes of the United States, or in any one of the States
of Oregon, California, and Nevada, or in the Territories, shall receive
compensation for such examination as follows: For examining national
banks having a capital less than one hundred thousand dollars, twenty
dollars; those having a capital of one hundred thousand dollars and less
than three hundred thousand dollars, twenty-five dollars; those having
a capital of three hundred thousand dollars and less than four hundred
thousand dollars, thirty-five dollars; those having a capital of four hundred thousand dollars and less than five hundred thousand dollars,
forty dollars; those having a capital of five hundred thousand dollars
and less than six hundred thousand dollars, fifty dollars; those having
a capital of six hundred thousand dollars and over, seventy-five dollars;
which amounts shall be assessed by the Comptroller of the Currency
upon, and paid by, the respective association so examined, and shall
be in lieu of the compensation and mileage heretofore allowed for making said examinations; and persons appointed to make examinations of
national banks in the cities named in section five thousand one hundred
and ninety-two of the Eevised Statutes of the United States, or in any
30
REPORT OF THE COMPTROLLER OF THE CURRENCY.
one of the States of Oregon, California, and Nevada, or in the Territories, shall receive such compensation as may be fixed b.y the Secretary of the Treasury upon the recommendation of the Comptroller of
the Currency 5 and the same shall be assessed and paid in the manner
hereinbefore provided.
128. EXAMINATIONS IN DISTRICT OF COLUMBIA. (SEC. 332.)
The
Comptroller of the Currency, in addition to the powers conferred upon
him by law for the examination of national banks, is further authorized,
whenever he may deem it useful, to cause examination to be made into
the condition of any bank in the District of Columbia organized under
act of Congress. The Comptroller, at his discretion, may report to
Congress the results of such examination. The expense necessarily
incurred in any such examination shall be paid out of any appropriation made by Congress for special bank examinations.
129. LIMITATION OF VISITORIAL POWERS. (SEC. 5241.) T$o association shall be subject to any visitorial .powers other than such as are
authorized by this Title, or are vested in the courts of justice.
130. USE OF «NATIONAL" IN TITLES. (SEC. 5243.) All banks not
organized and transacting business under the national currency laws,
or under this Title, and all persons or corporations doing the business
of bankers, brokers, or savings institutions, except savings banks
authorized by Congress to use the word "national" as
a part of their
corporate name, are prohibited from using the word unational" as a
portion of the name or title of such bank, corporation, firm, or partnership 5 and any violation of this prohibition committed after the third
day of September, eighteen hundred and seventy-three, shall subject
the party chargeable therewith to a penalty of fifty dollars for each day
during which it is permitted or repeated.
CHAPTEE SIX.
EXTENSION OF CORPORATE EXISTENCE.
131. Corporate existence may be extended. 134. Status not changed by extension.
132. Consent of two-thirds necessary.
135. Dissenting shareholders may withdraw.
133. Special examination of bank.
131. CORPORATE EXISTENCE MAY BE EXTENDED.—The act of July
12, 1882, provides: (SEC. 1) That any national banking association
organized under the acts of February twenty-fifth, eighteen hundred
and sixty-three, June third, eighteen hundred and sixty-four, and
February fourteenth, eighteen hundred and eiglity, or under sections
fifty-one hundred and thirty-three, fifty-one hundred and thirty-four,
fifty-one hundred and thirty-five, fifty-one hundred and thirty-six, and
fifty-one hundred and fifty-four of the Eevised Statutes of the United
States, may, at any time within the two years next previous to the
date of the expiration of its corporate existence under present law, and
with the approval of the Comptroller of the Currency, to be granted
as hereinafter provided, extend its period of succession by amending
its articles of association for a term of not more than twenty years
from the expiration of the period of succession named in said articles
of association, and shall have succession for such extended period,
unless sooner dissolved by the act of shareholders owning two-thirds of
its stock, or unless its franchise becomes forfeited by some violation of
law, or unless hereafter modified or repealed.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
31
132. CONSENT OF TWO-THIRDS NECESSARY. (SEC. 2.) That such
amendment of said articles of association shall be authorized by the
consent in writing of shareholders owning not less than two-thirds of
the capital stock of the association; and the board of directors shall
cause such consent to be certified under the seal of the association, by
its president or cashier, to the Comptroller of the Currency, accompanied by an application made by the president or cashier for the
approval of the amended articles of association by the Comptroller;
and such amended articles of association shall not be valid until the
Comptroller shall give to such association a certificate under his hand
and seal that the association has complied with all the provisions
required to be complied with and is authorized to have succession for
the extended period named in the amended articles of association.
133. SPECIAL EXAMINATION OF BANK. (SEC. 3.) That upon the
receipt of the application and certificate of the association provided for
in the preceding section, the Comptroller of the Currency shall cause a
special examination to be made, at the expense of the association, to
determine its condition; and if after such examination or otherwise it
appears to him that said association is in a satisfactory condition, he
shall grant his certificate of approval provided for in the preceding section, or if it appears that the condition of said association is not satisfactory, he shall withhold such certificate of approval.
134. STATUS NOT CHANGED BY EXTENSION. (SEC. 4.) That any association so extending the period of its succession shall continue to enjoy
all the rights and privileges and immunities granted and shall continue
to be subject to all the duties, liabilities, and restrictions imposed by
the Eevised Statutes of the United States and other acts having reference to national banking associations, and it shall continue to be in all
respects the identical association it was before the extension of its
period of succession.
135. DISSENTING SHAREHOLDERS MAY WITHDRAW. (SEC. 5.) That
when any national banking association has amended its articles of
association as provided in this act, and the Comptroller has granted his
certificate of approval, any shareholder not assenting to such amendment may give notice in writing to the directors, within thirty days
from the date of the certificate of approval, of his desire to withdraw
from said association, in which case he shall be entitled to receive from
said banking association the value of the shares so held by him, to be
ascertained by an appraisal made by a committee of three persons, one
to be selected by such shareholder, one by the directors, and the third
by the first two; and in case the value so fixed shall not be satisfactory to any such shareholder, he may appeal to the Comptroller of the
Currency, who shall cause a reappraisal to be made, which shall be
final and binding; and if said reappraisal shall exceed the value fixed
by said committee, the bank shall pay the expenses of said reappraisal,
and otherwise the appellant shall pay said expenses; and the value
so ascertained and determined shall be deemed to be a debt due, and
be forthwith paid, to said shareholder, from said bank; and the shares
so surrendered and appraised shall, after due notice, be sold at public
sale, within thirty days after the final appraisal provided in this section:
Provided, That in the organization of any banking association intended
to replace any existing banking association, and retaining the name
thereof, the holders of stock in the expiring association shall be entitled
to preference in the allotment of the shares of the new association in
proportion to the number of shares held by them respectively in the
expiring association.
32
REPORT OF THE COMPTROLLER OF THE CURRENCY.
CHAPTER SEVEN.
LIQUIDATION AND RECEIVERSHIP.
136. Two-thirds vote required for liquidation.
137. Notice of voluntary liquidation.
138. Deposit of lawful money.
139. No deposit required for consolidation.
140. Bonds of liquidating banks.
141. Banks whose existence lias expired.
142. Protest of bank circulation.
143. Bonds forfeited if circulation is dishonored.
144. Bank may enjoin further proceedings.
145. Where proceedings must be brought.
146. Suspension of business after default.
147. Notice to present circulation for redemption.
148. Bonds sold at public auction.
149. First lien for redeeming circulation.
150.
151.
152.
153.
154.
155.
156.
157.
158.
159.
160.
161.
162.
163.
Bonds sold at private sale.
Appointment and duties of receiver.
When receiver may be appointed.
Notice to creditors of insolvent
banks.
Distribution of assets of insolvent
banks.
Expenses of receivership—how paid.
Forfeiture of charter.
Individual liability of directors.
Receiver may purchase property to
protect his trust.
Taxes on insolvent national banks
remitted.
Appointment and qualification of
shareholders' ageut.
Duties of shareholders' agent.
Illegal preference of creditors.
Creditor's bill against shareholders.
136. TWO-THIRDS VOTE BEQUIRED FOR LIQUIDATION. (SEC. 5220.)
Any association may go into liquidation and be closed by the vote of
its shareholders owning two-thirds of its stock.
137. NOTICE OF VOLUNTARY LIQUIDATION. (SEC. 5221.) Whenever a vote is taken to go into liquidation it shall be the duty of the
board of directors to cause notice of this fact to be certified, under the
seal of the association, by its president or cashier, to the Comptroller
of the Currency, and the publication thereof to be made for a period of
two months in a newspaper published in the city of New York, and also
in a newspaper published in the city or town in which the association
is located, or if no newspaper is there published, then in the newspaper
published nearest thereto, that the association is closing up its affairs,
and notifying the holders of its notes and other creditors to present the
notes and other claims against the association for payment.
138. DEPOSIT OF LAWFUL MONEY. (SEC. 5222.) Within six months
from the date of the vote to go into liquidation the association shall
deposit with the Treasurer of the United States lawful money of the
United States sufficient to redeem all its outstanding circulation.
The Treasurer shall execute duplicate receipts for money thus deposited,
and deliver one to the association and the other to the Comptroller of
the Currency, stating the amount received by him, and the purpose for
which it has been received; and the money shall be paid into the Treasury of the United States, and placed to the credit of such association
upon redemption account.
139. No DEPOSIT EEQUIRED FOR CONSOLIDATION. (SEC. 5223.) An
association which is in good faith winding up its business for the purpose of consolidating with another association shall not be required
to deposit lawful money for its outstanding circulation; but its assets
and liabilities shall be reported by the association with which it is in
process of consolidation.
140. BONDS OF LIQUIDATING BANKS. (SEC. 5224.) W n e n e y e r a sufficient deposit of lawful money to redeem the outstanding circulation
of an association proposing to close its business has been made, the
bonds deposited by the association to secure payment of its notes shall
be reassigned to it, in the manner prescribed by section fifty-one hun-
REPORT OF THE COMPTROLLER OF THE CURRENCY.
33
dred and sixty-two. And thereafter the association and its shareholders shall stand discharged from all liabilities upon the circulating notes,
and those notes shall be redeemed at the Treasury of the United States.
And if any such bank shall fail to make the deposit and take up its
bonds for thirty days after the expiration of the time specified, the
Comptroller of the Currency shall have power to sell the bonds pledged
for the circulation of said bank at public auction in New York City,
and, after providing for the redemption and cancellation of said circulation, and the necessary expenses of the sale, to pay over any balance
remaining to the bank or its legal representatives.
141. BANKS WHOSE EXISTENCE HAS EXPIRED.—Sec. 7 of the
act
of July 12, 1882, provides that national banking associations whose
corporate existence has expired or shall hereafter expire, and which do
not avail themselves of the provisions of this act, shall be required to
comply with the provisions of sections fifty-two hundred and twentyone and fifty-two hundred and twenty-two of the Kevised Statutes
in the same manner as if the shareholders had voted to go into liquidation, as provided in section fifty-two hundred and twenty of the
Eevised Statutes; and the provisions of sections fifty-two hundred
and twenty-four and fifty-two hundred and twenty-five of the Bevised
Statutes shall also be applicable to such associations, except as modified by this act; and the franchise of such associations is hereby
extended for the sole purpose of liquidating their affairs until such
affairs are finally closed.
142. PROTEST OF BANK CIRCULATION. (SEC. 5226.) Whenever any
national banking association fails to redeem in the lawful money of the
United States any of its circulating notes, upon demand of payment
duly made during the usual hours of business, at the office of such
association, the holder may cause the same to be protested, in one package by a notary public, unless the president or cashier of the association whose notes are presented for payment offers to waive demand
and notice of the protest, and, in pursuance of such offer, makes, signs,
and delivers to the party making such demand an admission in writing,
stating the time of the demand, the amount demanded, and the fact of
the nonpayment thereof. The notary public, on making such protest,
or upon receiving such admission, shall forthwith forward such admission or notice of protest to the Comptroller of the Currency, retaining a
copy thereof. If, however, satisfactory proof is produced to the notary
public that the payment of the notes demanded is restrained by order
of any court of competent jurisdiction, he shall not protest the same.
When the holder of any notes causes more than one note or package
to be protested on the same day, he shall not receive pay for more than
one protest.
143. BONDS FORFEITED I F CIRCULATION IS DISHONORED. (SEC.
5227.) On receiving notice that any national banking association has
failed to redeem any of its circulating notes, as specified in the preceding section, the Comptroller of the Currency, with the concurrence of
the Secretary of the Treasury, may appoint a special agent, of whose
appointment immediate notice shall be given to such association, who
shall immediately proceed to ascertain whether it has refused to pay
its circulating notes in the lawful money of the United States, when
demanded, and shall report to the Comptroller the fact so ascertained.
If from such protest, and the report so made, the Comptroller is satisfied
that such association has refused to pay its circulating notes and is in
default, he shall, within thirty days after he has received notice of such
failure, declare the bonds deposited by such association forfeited to the
United States, and they shall thereupon be so forfeited.
H. DOG. 10
3
34
REPORT OF THE COMPTROLLER OP THE CURRENCY.
144. BANK MAY ENJOIN FURTHER PROCEEDINGS. (SEC. 5237.)
Whenever an association against which proceedings have been instituted, on account of any alleged refusal to redeem its circulating notes
as aforesaid, denies having failed to do so, it may, at any time within
ten days after it has been notified of the appointment of an agent, as
provided in section fifty-two hundred and twenty-seven, apply to the
nearest circuit, or district, or Territorial court of the United States to
enjoin further proceedings in the premises 5 and such court, after citing
the Comptroller of the Currency to show cause why further proceedings should not be enjoined, and after the decision of the court or finding of the jury that such association has not refused to redeem its
circulating notes, when legally presented, in the lawful money of the
United States, shall make an order enjoining the Comptroller, and any
receiver acting under his direction, from all further proceedings on
account of such alleged refusal.
145. W H E R E PROCEEDINGS MUST BE BROUGHT. (SEC. 736.)
All
proceedings by any national banking association to enjoin the Comptroller of the Currency, under the provisions of any law relating to
national banking associations, shall be had in the district where such
association is located.
146. SUSPENSION OF BUSINESS AFTER DEFAULT. (SEC. 5228.) After
a default on the part of an association to pay any of its circulating notes
has been ascertained by the Comptroller, and notice thereof has been
given by him to the association, it shall not be lawful for the association suffering the same to pay out any of its notes, discount any notes
or bills, or otherwise prosecute the business of banking, except to
receive and safely keep money belonging to it, and to deliver special
deposits.
147. NOTICE TO PRESENT CIRCULATION FOR EEDEMPTION. (SEC.
5229.) Immediately upon declaring the bonds of an association forfeited for nonpayment of its notes, the Comptroller shall give notice,
in such manner as the Secretary of the Treasury shall, by general rules
or otherwise direct, to the holders of the circulating notes of such association, to present them for payment at the Treasury of the United
States; and the same shall be paid as presented in lawful money of the
United States; whereupon the Comptroller may, in his discretion, cancel an amount of bonds pledged by such association equal at current
market rates, not exceeding par, to the notes paid.
148. BONDS SOLD AT PUBLIC AUCTION. (SEC. 5230.) Whenever
the Comptroller has become satisfied, by the protest or the waiver and
admission specified in section fifty-two hundred and twenty-six, or by
the report provided for in section fifty-two hundred and twenty-seven,
that any association has refused to pay its circulating notes, he may,
instead of canceling its bonds, cause so much of them as may be
necessary to redeem its outstanding notes to be sold
at public auction
in the city of New York, after giving thirty days7 notice of such sale
to the association.
149. FIRST LIEN FOR BEDEEMINC* CIRCULATION. (SEC. 5230.) For
any deficiency in the proceeds of all the bonds of an association, when
thus sold, to reimburse to the United States the amount expended in
paying the circulating notes of the association, the United States shall
have a paramount lien upon all its assets; and such deficiency shall
be made good out of such assets in preference to any aud all other
claims whatsoever, except the necessary costs and expenses of administering the same.
150. BONDS SOLD AT PRIVATE SALE. (SEC. 5231.) The Comptroller
may, if he deems it for the interest of the United States, sell at private
REPORT OF THE COMPTROLLER OF THE CURRENCY.
35
sale any of the bonds of an association shown to have made default in
paying its notes, and receive therefor either money or the circulating
notes of the association. But no such bonds shall be sold by private
sale for less than par, nor for less than the market value thereof at the
time of sale; and no sales of any such bonds, either public or private,
shall be complete until the transfer of the bonds shall have been made
with the formalities prescribed by sectionsfifty-onehundred and sixtytwo, fifty-one hundred and sixty-three, and fifty-one hundred and sixtyfour.
151. APPOINTMENT AND DUTIES OF EECEIVER. (SEC. 5234.) On
becoming satisfied, as specified in sections fifty-two hundred and
twenty-six andfifty-twohundred and twenty-seven, that any association
has refused to pay its circulating notes as therein mentioned, and is in
default, the Comptroller of the Currency may forthwith appoint a
receiver, and require of him such bond and security as he deems proper.
Such receiver, under the direction of the Comptroller, shall take possession of the books, records, and assets of every description of such
association, collect all debts, dues, and claims belonging to it, and,
upon the order of a court of record of competent jurisdiction, may sell
or compound all bad or doubtful debts, and, on a like order, may sell
all the real and personal property of such association, on such terms as
the court shall direct; and may, if necessary to pay the debts of such
association, enforce the individual liability of the stockholders. Such
receiver shall pay over all money so made to the Treasurer of the United
States, subject to the order of the Comptroller, and also make report
to the Comptroller of all his acts and proceedings.
152. WHEN EECEIVER MAY BE APPOINTED.—Sec. 1 of the act of
June 30,1876, provides that whenever any national banking association
shall be dissolved, and its rights, privileges, and franchises declared
forfeited, as prescribed in section fifty-two hundred and thirty-nine of
the Eevised Statutes of the United States, or whenever any creditor of
any national banking association shall have obtained a judgment against
it in any court of record, and made application, accompanied by a certificate from the clerk of the court stating that such judgment has been
rendered and has remained unpaid for the space of thirty days, or whenever the Comptroller shall become satisfied of the insolvency of the
national banking association, he may, after due examination of its
affairs, in either case, appoint a receiver, who shall proceed to close up
such association, and enforce the personal liability of the shareholders,
as provided in sectionfifty-twohundred and thirty-four of said statutes.
A receiver may also be appointed, under the provisions of section fiftytwo hundred and thirty-four of the Eevised Statutes of the United
States, for the following violations of law:
Where the capital stock of a national bank has not been fully paid in
and it is thus reduced below the legal minimum and remains so for
thirty days. (Sec. 5141, E. S.)
For failure to make good the lawful-money reserve within thirty days
after notice. (Sec. 5191, E. S.)
Where a bank purchases or acquires its own stock, other than to prevent loss upon a debt previously contracted in good faith, and the same
is not sold or disposed of within six months from the time of its purchase.
(Sec. 5201, E. S.)
Where an association fails to make good any impairment in its capital
stock and refuses to go into liquidation within three months after receiving notice. (Sec. 5205, E. S.)
The act of any officer, clerk, or agent of any association in violation
of the provisions relating to the false certification of checks shall subject such bank to the appointment of a receiver. (Sec. 5208, E. S.)
36
REPORT OF THE COMPTROLLER OF THE CURRENCY,
153. NOTICE TO CREDITORS OF INSOLVENT BANKS. (SEC. 5235.) The
Comptroller shall, upon appointing a receiver, cause notice to be given,
by advertisement in such newspapers as he may direct, for three consecutive months, calling on all persons who may have claims against
such association to present the same and to make legal proof thereof.
154. DISTRIBUTION OF ASSETS OF INSOLVENT BANKS. (SEC. 5236.)
From time to time, after full provision has been first made for refunding to the United States any deficiency in redeeming the notes of such
association, the Comptroller shall make a ratable dividend of the money
so paid over to him by such receiver on all such claims as may have
been proved to his satisfaction or adjudicated in a court of competent
jurisdiction, and, as the proceeds of the assets of such association are
paid over to him, shall make further dividends on all claims previously
proved or adjudicated; and the remainder of the proceeds, if any, sh§ll
be paid over to the shareholders of such association, or their legal representatives, in proportion to the stock by them respectively held.
155. EXPENSES OF EECEIVERSHIP—How PAID. (SEC. 5238.) All fees
for protesting the notes issued by any national banking association
shall be paid by the person procuring the protest to be made, and such
association shall be liable therefor; but no part of the bonds deposited
by such association shall be applied to the payment*of such fees. All
expenses of any preliminary or other examinations into the condition
of any association shall be paid by such association. All expenses of
any receivership shall be paid out of the assets of such association
before distribution of the proceeds thereof.
156. FORFEITURE OF CHARTER. (SEC. 5239.) If the directors of
any national banking association shall knowingly violate, or knowingly
permit any of the officers, agents, or servants of the association to violate, any of the provisions of this Title, all the rights, privileges, and
franchises of the association shall be thereby forfeited. Such violation
shall, however, be determined and adjudged by a proper circuit, district, or Territorial court of the United States, in a suit brought for
that purpose by the Comptroller of the Currency, in his own name,
before the association shall be declared dissolved.
157. INDIVIDUAL LIABILITY OF DIRECTORS. (SEC. 5239.) And in
cases of such violation every director who participated in or assented
to the same shall be held liable in his personal and individual capacity
for all damages which the association, its shareholders, or any other
person shall have sustained in consequence of such violation.
158. EECEIVER MAY PURCHASE PROPERTY TO PROTECT H I S
TRUST.—The act of March 29,1886, provides: (SEC. 1.) That whenever
the receiver of any national bank duly appointed by the Comptroller of
the Currency, and who shall have duly qualified and entered upon the
discharge of his trust, shall find it in his opinion necessary, in order to
fully protect and benefit his said trust, to the extent of any and all
equities that such trust may have in any property, real or personal, by
reason of any bond, mortgage, assignment, or other proper legal claim
attaching thereto, and which said property is to be sold under any
execution, decree of foreclosure, or proper order of any court of jurisdiction, he may certify the facts in the case, together with his opinion as
to the value of the property to be sold and the value of the equity his
said trust may have in the same, to the Comptroller of the Currency,
together with a request for the right and authority to use and employ
so much of the money of said trust as may be necessary to purchase
such property at such sale.
SEC. 2. That such request, if approved by the Comptroller of the
Currency, shall be, together with the certificate of facts in the case and
REPORT OF THE COMPTROLLER OF THE CURRENCY.
37
his recommendation as to the amount of money which in his judgment
should be so used and employed, submitted to the Secretary of the
Treasury, and if the same shall likewise be approved by him the request shall be by the Comptroller of the Currency allowed, and notice
thereof, with copies of the request, certificate of facts, and indorsement of approvals, shall be filed with the Treasurer of the United
States.
SEC. 3. That whenever any such request shall be allowed as hereinbefore provided, the said Comptroller of the Currency shall be, and is,
empowered to draw upon and from such funds of any such trust as
may be deposited with the Treasurer of the United States for the benefit of the bank in interest to the amount as may be recommended and
allowed and for the purpose for which such allowance was made: Provided^ however. That all payments to be made for or on account of the
purchase of any such property and under any such allowance shall be
made by the Comptroller of the Currency direct, with the approval of
the Secretary of the Treasury, for such purpose only and in such manner as he may determine and order.
159. TAXES ON INSOLVENT NATIONAL BANKS EEMITTED.—The act
of March 1,1879, provides that whenever and after any bank has ceased
to do business by reason of insolvency or bankruptcy no tax shall be
assessed or collected, or paid into the Treasury of the United States, on
account of such bank, which shall diminish the assets thereof necessary
for the full payment of all its depositors; and such tax shall be abated
from such national banks as are found by the Comptroller of the Currency to be insolvent; and the Commissioner of Internal Eevenue, when
the facts shall so appear to him, is authorized to remit so much of said
tax against insolvent State and savings banks as shall be found to
affect the claims of their depositors.
160. APPOINTMENT
AND
QUALIFICATION OF SHAREHOLDERS'
AGENT.—Sec. 3 of the act of June 30,1876, as amended by acts of August 3,1892, and March 2,1897, provides that whenever any association
shall have been or shall be placed in the hands of a receiver, as provided
in section fifty-two hundred and thirty-four and other sections of the
Eevised Statutes of the United States, and when, as provided in section
fifty-two hundred and thirty six thereof, the Comptroller of the Currency
shall have paid to each and every creditor of such association, not including shareholders who are creditors of such association, whose claim
or claims as such creditor shall have been proved or allowed as therein
prescribed, the full amount of such claims, and all expenses of the receivership and the redemption of the circulating notes of such association
shall have been provided for by depositing lawful money of the United
States with the Treasurer of the United States, the Comptroller of the
Currency shall call a meeting of the shareholders of such association by
giving notice thereof for thirty days in a newspaper published in the
town, city, or county where the business of such association was carried
on, or if no newspaper is there published, in the newspaper published
nearest thereto. At such meeeting the shareholders shall determine
whether the receiver shall be continued and shall wind up the affairs of
such association, or whether an agent shall be elected for that purpose,
and in so determining the said shareholders shall vote by ballot, in
person or by proxy, each share of stock entitling the holder to one vote,
and the majority of the stock in value and number of shares shall be
necessary to determine whether the said receiver shall be continued, or
whether an agent shall be elected. In case such majority shall determine that the suid receiver shall be continued, the said receiver shall
38
REPORT OF THE COMPTROLLER OF THE CURRENCY,
thereupon proceed with the execution of his trust, and shall sell, dispose of, or otherwise collect the assets of the said association, and shall
possess all the powers and authority, and be subject to all the duties
and liabilities originally conferred or imposed upon him by his appointment as such receiver, so far as the same remain applicable. In case
the said meeting shall, by the vote of a majority of the stock in value
and number of shares, determine that an agent shall be elected, the
said meeting shall thereupon proceed to elect an agent, voting by ballot,
in person or by proxy, each share of stock entitling the holder to one
vote, and the person who shall receive votes representing at least a
majority of stock in value and number shall be declared the agent for
the purposes hereinafter provided; and whenever any of the shareholders of the association shall, after the election of such agent, have
executed and filed a bond to the satisfaction of the Comptroller of the
Currency, conditioned for the payment and discharge in full of each
and every claim that may thereafter be proved and allowed by and
before a competent court, and for the faithful performance of all and singular the duties of such trust, the Comptroller and the receiver shall
thereupon transfer and deliver to such agent all the undivided or uncol
lected or other assets of such association then remaining in the hands or
subject to the order and control of said Comptroller and said receiver, or
either of them; and for this purpose said Comptroller and said receiver
are hereby severally empowered and directed to execute any deed,
assignment, transfer, or other instrument in writing that may be necessary and proper; and upon the execution and delivery of such instru
ment to the said agent the said Comptroller and the said receiver shall
by virtue of this act be discharged from any and all liabilities to such
association and to each and all the creditors and shareholders thereof.
161. DUTIES OF SHAREHOLDERS7 AGENT.—Sec. 3 of the act of June
30,187G, as amended by acts of August 3,1892, and March 2,1897, provides : Upon receiving such deed, assignment, transfer, or other instrument, the person elected such agent shall hold, control, and dispose of
the assets and property of such association which he may receive under
the terms hereof for the benefit of the shareholders of such association,
and he may in his own name, or in the name of such association, sue aud
be sued and do all other lawful acts and things necessary to finally settle and distribute the assets and property in his hands, and may sell,
compromise, or compound the debts due to such association, with the
consent and approval of the circuit or district court of the United States
for the district where the business of such association was carried on.
and shall at the conclusion of his trust render to such district or circuit
court a full account of all his proceedings, receipts, and expenditures as
such agent, which court shall, upon due notice, settle and adjust such
accounts and discharge said agent and the sureties upon said bond.
And in case any such agent so elected shall refuse to serve, or die,
resign, or be removed, any shareholder may call a meeting of the shareholders of such association in the town, city, or village where the business of the said association was carried on, by giving notice thereof
for thirty days in a newspaper published in said town, city, or village,
or if no newspaper is there published, in the newspaper published nearest
thereto, at which meeting the shareholders shall elect an agent, voting
by ballot, in person or by proxy, each share of stock entitling the holder
to one vote, and when such agent shall have received votes representing at least a majority of the stock in value and number of shares, and
shall have executed a bond to the shareholders conditioned for the faithful performance of his duties, in the penalty fixed by the shareholders
REPORT OF THE COMPTROLLER OF THE CURRENCY.
39
at said meeting, with two sureties, to be approved by a judge of a court
of record, and file said bond in the office of the clerk of a court of
record in the county where the business of said association was carried on, he shall have all the rights, powers, and duties of the agent
first elected as hereinbefore provided At any meeting held as hereinbefore provided administrators or executors of deceased shareholders
may act and sign as the decedent might have done if living, and guardians of minors and trustees of other persons may so act and sign for
their ward or wards or cestui que trust. The proceeds of the assets or
property of any such association which may be undistributed at the
time of such meeting or may be subsequently received shall be distributed
as follows:
u
First. To pay the expenses of the execution of the trust to the date
of usuch payment.
Second. To repay any amount or amounts which have been paid in
by any shareholder or shareholders of such association upon and by
reason of any and all assessments made upon the stock of such association by the order of the Comptroller of the Currency in accordance
with the provisions of the statutes of the United States; and
" Third. The balance ratably among such stockholders, in proportion
to the number of shares held and owned by each. Such distribution
shall be made from time to time as the proceeds shall be received and
as shall be deemed advisable by the said Comptroller or said agent."
162. ILLEGAL PREFERENCE OF CREDITORS. (SEC. 5242.) All transfers of the notes, bonds, bills of exchange, or other evidences of debt
owing to any national banking association, or of deposits to its credit;
all assignments of mortgages, sureties on real estate, or of judgments
or decrees in its favor; all deposits of money, bullion, or other valuable
thing for its use, or for the use of any of its shareholders or creditors;
and all payments of money to either, made after the commission of an
act of insolvency, or in contemplation thereof, made with a view to
prevent the application of its assets in the manner prescribed by this
chapter, or with a view to the preference of one creditor to another,
except in payment of its circulating notes, shall be utterly null and
void. No attachment, injunction, or execution shall be issued against
such association or its property before final judgment in any suit,
action, or proceeding in any State, county, or municipal court.
163. CREDITOR'S BILL AGAINST SHAREHOLDERS.—Sec. 2 of the
act
of June 30,1876, provides that when any national banking association
shall have gone into liquidation under the provisions of section five
thousand two hundred and twenty of said statutes, the individual liability of the shareholders provided for by sectionfifty-onehundred and
fifty-one of said statutes may be enforced by any creditor of such association, by bill in equity in the nature of a creditor's bill, brought by
such creditor on behalf of himself and of all other creditors of the
association, against the shareholders thereof, in any court of the United
States having original jurisdiction in equity for the district in which
such association may have been located or established.
40
REPORT OF THE COMPTROLLER OF THE CURRENCY.
CHAPTER EIGHT.
164. Penalty for improper countersigning
or delivering circulation.
165. Penalty for pledging United States
notes or bank circulation.
166. Penalty for imitating bank circulation for advertising purposes.
167. Penalty for mutilating circulation.
168* Penalty for counterfeiting circulation.
169. What are obligations of the United
States.
170. Penalty for illegal possession or use
of material for circulation.
171. Penalty for passing counterfeit circulation.
172. Penalty for taking unauthorized
impressions of tools.
173. Penalty for having such impressions.
174. Penalty for dealing in counterfeit
circulation.
175. Penalty for issuing circulation of
expired associations.
176. False certification of checks.
177. Penalty for false certification of
checks.
178. Penalty for official malfeasance.
179. Jurisdiction of circuit courts to enjoin Comptroller.
180. General jurisdiction of nationalbank cases.
181. Sealed certificates of Comptroller
are competent evidence.
182. Certified copy of organization certificate as evidence.
183. Suits against United States officers
or agents.
184. Indian Territory.
164. PENALTY FOR IMPROPER COUNTERSIGNING OR DELIVERING
CIRCULATION. (SEC. 5187.) Eo officer acting under the provisions of
this Title shall countersign or deliver to any association, or to any other
company or person, any circulating notes contemplated by this Title,
except in accordance with the true intent and meaning of its provisions.
Every officer who violates this section shall be deemed guilty of a high
misdemeanor, and shall be fined not more than double the amount so
countersigned and delivered, and imprisoned not less than one year
and not more than fifteen years.
165. PENALTY FOR PLEDGING UNITED STATES NOTES OR BANK
CIRCULATION. (SEC. 5207.) No association shall hereafter offer or receive
United States notes or national-bank notes as security or as collateral
security for any loan of money, or for a consideration agree to withhold
the same from use, or offer or receive the custody or promise of custody
of such notes as security, or as collateral security, or consideration for
any loan of money. Any association offending against the provisions
of this section shall be deemed guilty of a misdemeanor, and shall be
fined not more than one thousand dollars and a further sum equal to
one-third of the money so loaned. The officer or officers of any association who shall make any such loan shall be liable for a further sum
equal to one-quarter of the money loaned; and any fine or penalty
incurred by a violation of this section shall be recoverable for the benefit
of the party bringing such suit. Sec. 12 of the act of July 12,1882,
provides that the provisions of this section shall apply to the United
States certificates of gold and silver coin.
166. PENALTY FOR IMITATING BANK CIRCULATION FOR ADVERTISING PURPOSES. (SEC. 5188.) It shall not be lawful to design,
engrave, print, or in any manner make or execute, or to utter, issue,
distribute, circulate, or use any business or professional card, notice,
placard, circular, handbill, or advertisement in the likeness or similitude of any circulating note or other obligation or security of any banking association organized or acting under the laws of the United States
which has been or may be issued under this Title, or any act of Congress,
or to write, print, or otherwise impress upon any such note, obligation,
or security any business or professional card, notice, or advertise
ment, or any notice or advertisement of any matter or thing whatever.
Every person who violates this section shall be liable to a penalty of
one hundred dollars, recoverable one-half to the use of the informer.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
41
167. PENALTY FOR MUTILATING CIRCULATION. (SEC. 5189.) Every
person who mutilates, cuts, defaces, disfigures, or perforates with holes,
or unites or cements together, or does any other thing to any bank bill,
draft, note, or other evidence of debt, issued by any national banking
association, or who causes or procures the same to be done, with intent
to render such bank bill, draft, note, or other evidence of debt unfit to
be reissued by said association, shall be liable to a penalty of fifty dollars, recoverable by the association.
168. PENALTY FOR COUNTERFEITING CIRCULATION. (SEC. 5415.)
Every person who falsely makes, forges, or counterfeits, or causes or procures to be made, forged, or counterfeited, or willingly aids or assists in
falsely making, forging, or counterfeiting, any note in imitation of, or purporting to be in imitation of, the circulating notes issued by any banking
association now or hereafter authorized and acting under the laws of the
United States; or who passes, utters, or publishes, or attempts to pass,
utter, or publish, any false, forged, or counterfeited note purporting to
be issued by any such association doing a banking business, knowing the
same to be falsely made, forged, or counterfeited, or who falsely alters,
or causes or procures to be falsely altered, or willingly aids or assists in
falsely altering any such circulating notes, or passes, utters, or publishes, or attempts to pass, utter, or publish as true, any falsely altered
or spurious circulating note issue, or purporting to have been issued, by
any such banking association, knowing the same to be falsely altered or
spurious, shall be imprisoned at hard labor not less than five years nor
more than fifteen years, and fined not more than one thousand dollars.
169. WHAT ARE OBLIGATIONS OF THE UNITED STATES. (SEC.
5413.) The words "obligation or other security of the United States"
shall be held to mean all bonds, certificates of indebtedness, nationalbank currency, coupons, United States notes, Treasury notes, fractional
notes, certificates of deposit, bills, checks, or drafts for money drawn
by or upon authorized officers of the United States, stamps and other
representatives of value, of whatever denomination, which have been
or may [be] issued under any act of Congress.
170. PENALTY FOR ILLEGAL POSSESSION OR USE OF MATERIAL
FOR CIRCULATION. (SEC. 5430.) Every person having control, cus-
tody, or possession of any plate, or any part thereof, from which has
been printed, or which may be prepared by direction of the Secretary
of the Treasury for the purpose of printing, any obligation or other
security of the United States, who uses such plate, or knowingly
suffers the same to be used for the purpose of printing any such or
similar obligation, or other security, or any part thereof, except as
may be printed for the use of the United States by order of the proper
officer thereof; and every person who engraves, or causes or procures
to be engraved, or assists in engraving, any plate in the likeness of
any plate designed for the printing of such obligation or other security,
or who sells any such plate, or who brings into the United States from
any foreign place any such plate, except under the direction of the Secretary of the Treasury or other proper officer, or with any other intent,
in either case, than that such plate be used for the printing of the obligations or other securities of the United States; or who has in his
control, custody, or possession any metallic plate engraved after the
similitude of any plate from which any such obligation or other security
has been printed, with intent to use such plate, or suffer the same to be
used in forging or counterfeiting any such obligation or other security,
or any part thereof; or who has in his possession or custody, except
under authority from the Secretary of the Treasury or other proper
officer, any obligation or other security, engraved and printed after
42
REPORT OP THE COMPTROLLER OF THE CURRENCY.
the similitude of any obligation or other security issued under the
authority of the United States, with intent to sell or otherwise use the
same; and every person who prints, photographs, or in any other manner makes or executes, or causes to be printed, photographed, made, or
executed, or aids in printing, photographing, making, or executing any
engraving, photograph, print, or impression in the likeness of any such
obligation or other security, or any part thereof, or who sells any such
engraving, photograph, print, or impression, except to the United
States, or who brings into the United States from any foreign place
any such engraving, photograph, print, or impression, except by direction of some proper officer of the United States, or who has or retains
in his control or x)ossession, after a distinctive paper has been adopted
by the Secretary of the Treasury for the obligations and other securities of the United States, any similar paper adapted to the making of
any such obligation or other security, except under the authority of the
Secretary of the Treasury or some other proper officer of the United
States, shall be punished by afineof not more thanfivethousand dollars,
or by imprisonment at hard labor not more than fifteen years, or by both.
171. PENALTY FOR PASSING COUNTERFEIT CIRCULATION. (SEC.
5431.) Every person who, with intent to defraud, passes, utters, publishes, or sells, or attempts to pass, utter, publish, or sell, or brings into
the United States with intent to pass, publish, utter, or sell, or keeps
in possession or conceals, with like intent, any falsely made, forged,
counterfeited, or altered obligation, or other security of the United
States, shall be punished by a fine of not more than five thousand dollars and by imprisonment at hard labor not more than fifteen years.
172. PENALTY FOR TAKING UNAUTHORIZED IMPRESSION OF TOOLS.
(SEC. 5432.) Every person who, without authority from the United
States, takes, procures, or makes, upon lead, foil, wax, plaster, paper,
or any other substance or material, an impression, stamp, or imprint of,
from, or by the use of, any bedplate, bedpiece, die, roll, plate, seal, type,
or other tool, implement, instrument, or thing used or fitted, or intended
to be used, in printing, stamping, or impressing, or in making other
tools, implements, instruments, or things, to be used, or fitted or
intended to be used, in printing, stamping, or impressing any kind or
description of obligation or other security of the United States, now
authorized or hereafter to be authorized by the United States, or circulating note or evidence of debt of any banking association under the
laws thereof, shall be punished by imprisonment at hard labor not more
than ten years, or by a fine of not more thanfivethousand dollars, or both.
173. PENALTY FOR HAVING SUCH IMPRESSIONS. (SEC. 5433.) Every
person who, with intent to defraud, has in his possession, keeping,
custody, or control, without authority from the United States, any
imprint, stamp, or impression, taken or made upon any substance or
material whatsoever, of any tool, implement, instrument, or thing used,
or fitted, or intended to be used for any of the purposes mentioned in
the preceding section; or who, with intent to defraud, sells, gives, or
delivers any such imprint, stamp, or impression to any other person,
shall be punished by imprisonment at hard labor not more than ten
years, or by a fine of not more than five thousand dollars.
174. PENALTY FOR DEALING IN COUNTERFEIT CIRCULATION. (SEC.
5434.) Every person who buys, sells, exchanges, transfers, receives, or
delivers any false, forged, counterfeited, or altered obligation or other
security of the United States, or circulating riote of any banking association organized or acting under the laws thereof, which has been or
may hereafter be issued by virtue of any act of Congress, with the intent
that the same be passed, published, or used as true and genuine, shall
REPORT OF THE COMPTROLLER OF THE CURRENCY.
43
be imprisoned at hard labor not more than ten years, or fined not more
than five thousand dollars, or both.
175. PENALTY FOR ISSUING CIRCULATION OF EXPIRED ASSOCIATIONS. (SEC. 5437.) In all cases where the charter of any corporation
which has been or may be created by act of Congress has expired or
may hereafter expire, if any director, officer, or agent of the corporation, or any trustee thereof or any agent of such trustee, or any person
having in his possession or under his control the property of the corporation for the purpose of paying or redeeming its notes and obligations,
knowingly issues, reissues, or utters as money, or in any other way knowingly puts in circulation any bill, note, check, draft, or other security
purporting to have been made by any such corporation whose charter
has expired, or by any officer thereof, or purporting to have been made
under authority derived therefrom, or if any person knowingly aids in
any such act, he shall be punished by a fine of not more than ten
thousand dollars, or by imprisonment not less than one year nor more
than five years, or by both such fine and imprisonment. But nothing
herein shall be construed to make it unlawful for any person, not being
such director, officer, or agent of the corporation, or any trustee thereof,
or any agent of such trustee, or any person having in his possession or
under his control the property of the corporation for the purpose hereinbefore set forth, who has received or may hereafter receive such bill,
note, check, draft, or other security, bona fide and in the ordinary transactions of business, to utter as money and otherwise circulate the same.
176. FALSE CERTIFICATION OF CHECKS. (SEC. 5208.) It shall be
unlawful for any officer, clerk, or agent of any national banking association to certify any check drawn upon the association unless the person
or company drawing the check has on deposit with the association, at
the time such check is certified, an amount of money equal to the
amount specified in such check. Any check so certified by duly
authorized officers shall be a good and valid obligation against the
association; but the act of any officer, clerk, or agent of any association, in violation of this section, shall subject such bank to the liabilities and proceedings on the part of the Comptroller as provided for in
section fifty-two hundred and thirty-four.
177. PENALTY FOR FALSE CERTIFICATION OF CHECKS.—Sec. 13
of the act of July 12,1882, provides that any officer, clerk, or agent of
any national banking association who shall willfully violate the provisions of section fifty-two hundred and eight of the Eevised Statutes of
the United States, or who shall resort to any device, or receive any fictitious obligation, direct or collateral, in order to evade the provisions
thereof, or who shall certify checks before the amount thereof shall have
been regularly entered to the credit of the dealer upon the books of the
banking association, shall be deemed guilty of a misdemeanor and
shall, on conviction thereof in any circuit or district court of the United
States, be fined not more than five thousand dollars, or shall be imprisoned not more than five years, or both, in the discretion of the court.
178. PENALTY FOR OFFICIAL MALFEASANCE. (SEC. 5209.) Every
president, director, cashier, teller, clerk, or agent of any association who
embezzles, abstracts, or willfully misapplies any of the moneys, funds, or
credits of the association, or who, without authority from the directors,
issues or puts in circulation any of the notes of the association; or who,
without such authority, issues or puts forth any certificate of deposit,
draws any order or bill of exchange, makes any acceptance, assigns
any note, bond, draft, bill of exchange, mortgage, judgment, or decree 5
or who makes any false entry in any book, report, or statement of the
association, with intent, in either case, to injure or defraud the associa
44
REPORT OF THE COMPTROLLER OF THE CURRENCY.
tion or any other company, body politic or corporate, or any individual
person, or to deceive any officer of the association or any agent
appointed to examine the affairs of any such association; and every
person who with like intent aids or abets any officer, clerk, or agent in
any violation of this section, shall be deemed guilty of a misdemeanor,
and shall be imprisoned not less than five years nor more than ten.
179. JURISDICTION OF CIRCUIT COURTS TO ENJOIN COMPTROL-
LER. (SEC. 629.) The circuit courts shall have original jurisdiction of
all suits brought by any banking association established in the district for which the court is held, under the provisions of Title u THE
NATIONAL BANKS/ 7 to enjoin the Comptroller of the Currency, or any
receiver acting under his direction, as provided by said Title.
180. GENERAL JURISDICTION OF NATIONAL-BANK CASES.—Sec.
4 of the act of July 12, 1882, provides that the jurisdiction for suits
hereafter brought by or against any association established under any
law providing for national banking associations, except suits between
them and the United States or its officers and agents, shall be the
same as, and not other than, the jurisdiction for suits by or against
banks not organized under any law of the United States which do or
might do banking business where such national banking associations
may be doing business when such suits may be begun. And all laws
and parts of laws of the United States inconsistent with this proviso
be, and the same are hereby, repealed. Sec. 4 of the act of March 3,
1887, provides that all national banking associations established under
the laws of the United States shall, for the purposes of all actions by
or against them, real, personal, or mixed, and all suits in equity, be
deemed citizens of the States in which they are respectively located;
and in such cases the circuit and district courts shall not have jurisdiction other than such as they would have in cases between individual
citizens of the same State. The provisions of this section shall not be
held to affect the jurisdiction of the courts of the United States in
cases commenced by the United States or by direction of any officer
thereof, or cases for winding up the affairs of any such bank.
181. SEALED CERTIFICATES OF COMPTROLLER ARE COMPETENT
EVIDENCE. (SEC. 884.) Every certificate, assignment, and conveyance
executed by the Comptroller of the Currency, in pursuance of law, and
sealed with his seal of office, shall be received in evidence in all places
and courts; and all copies of papers in his office, certified by him and
authenticated by the said seal, shall in all cases be evidence equally
with the originals. An impression of such seal directly on the paper
shall be as valid as if made on wax or wafer.
182. CERTIFIED COPY OF ORGANIZATION CERTIFICATE AS EVIDENCE. (SEC. 885.) Copies of the organization certificate of any national
banking association, duly certified by the Comptoller of the Currency
and authenticated by his seal of office, shall be evidence in all courts
and places within the jurisdiction of the United States of the existence
of the association and of every matter which could be proved by the
production of the original certificate.
183. SUITS AGAINST UNITED STATES OFFICERS OR AGENTS. (SEC.
380.) All suits and proceedings arising out of the provisions of law
governing national banking associations, in which the United States or
any of its officers or agents shall be parties, shall be conducted by the
district attorneys of the several districts under the direction and supervision of the Solicitor of the Treasury.
184. INDIAN TERRITORY.—Sec. 31 of the Act of May 2,1890, provides
that all laws relating tonational banking associations shall have the same
force and effect in Indian Territory as elsewhere in the United States.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
45
CHAPTER NINE.
TRUST COMPANIES, ETC., DISTRICT OF COLUMBIA.
185. Provision for organization.
186. Organization certificate of company.
187. Charter obtained from District Commissioners.
188. Notice of intention to apply for
charter.
189. Charter filed with recorder of
deeds for the District.
190. Trust companies under Comptroller's
supervision.
191. Powers of these companies.
192. Competent to act as trustee, etc.
193. Qualifications of such trustee, etc.
194. Security for faithful performance of
trust.
195. Privileges extended to existing corporations.
196. Real estate.
197. Period of corporation's existence.
198. Provisions relating to capital stock.
199. Enforcement of subscriptions to
stock.
200. Annual report to Comptroller.
201. Tax on gross earnings.
202. Liability for failure to report.
203.
204.
205.
206.
207.
208.
209.
210.
211.
212.
213.
214.
215.
216.
217.
218.
219.
Perjury and larceny.
Transfer of stock.
Liability of stockholders.
Money payment of capital stock
required.
Number and election of directors.
Appointment of officers.
By-laws.
Directors liable for payment of unearned dividends.
Directors' liability may be avoided.
Responsibility of directors for excess
liabilities.
Trustee, etc., not liable on stock
assessment.
Increase of capital.
Certified copy of incorporation certificate competent evidence.
No bond or other security required
of trust companies.
District supreme court has jurisdiction of trust companies.
All similar District corporations
subject to this act.
Provisions for amendment.
185. PROVISION FOR ORGANIZATION.—The act of October 1,1890,
sec. 1, provides that corporations may be formed within the District of
Columbia for the purposes hereinafter mentioned in the following manner: Any time hereafter any number of natural persons, citizens of
the United States, not less than twenty-five, may associate themselves
together to form a company for the purpose of carrying on in the District of Columbia any one of the three classes of business herein specified, to wit:
First. A safe deposit, trust, loan, and mortgage business.
Second. A title insurance, loan, and mortgage business.
Third. A security, guaranty, indemnity, loan, and mortgage business : Provided, That the capital stock of any of said companies shall
not be less than one million of dollars: Provided further, That any of
said companies may also do a storage business when their capital stock
amounts to the sum of not less than one million two hundred thousand
dollars.
186. ORGANIZATION CERTIFICATE OF COMPANY. (SEC. 2.) That
such persons shall, under their hands and seals, execute, before some
officer in said District competent to take the acknowledgment of deeds,
an organization certificate, which shall specifically state—
First. Title.—The name of the corporation.
Second. Purposes.—The purposes lor which it is formed.
Third. Period of existence.—The term for which it is to exist, which
shall not exceed the term of fifty years, and be subject to alteration,
amendment, or repeal by Congress at any time.
Fourth. Officers.—The number of its directors, and the names and
residences of the officers who for the first year are to manage the affairs
of the company.
Fifth. Capital stock.—The amount of the capital stock and its subdivision into shares.
46
REPORT OF THE COMPTROLLER OF THE CURRENCY.
187. CHARTER OBTAINED FROM DISTRICT COMMISSIONERS. (SEC.
3.) That this certificate shall be presented to the Commissioners of the
District, who shall have power and discretion to grant or to refuse to
said persons a charter of incorporation upon the terms set forth in the
said certificate and the provisions of this act.
188. NOTICE OF INTENTION TO A P P L Y FOR CHARTER. (SEC. 4.)
That previous to the presentation of the said certificate to the said Commissioners notice of the intention to apply for such charter shall be
inserted in two newspapers of general circulation printed in the District
of Columbia at least four times a week for three weeks, setting forth
briefly the name of the proposed company, its character and object, the
names of the proposed corporators, and the intention to make application for a charter on a specified day, and the proof of such publication
shall be presented with said certificate when presentation thereof is
made to said Commissioners.
189. CHARTER FILED WITH EECORDER OF DEEDS FOR THE DISTRICT. (SEC. 5.) That if the charter be granted as aforesaid it, together
with the certificate of the Commissioners granting the same indorsed
thereon, shall be filed for record in the office of the recorder of deeds
for the District of Columbia, and shall be recorded by him. On the
filing of the said certificate with the said recorder of deeds as herein
provided, approved as aforesaid by the said Commissioners, the persons named therein and their successors shall thereupon and thereby be
and become a body corporate and politic, and as such shall be vested
with all the powers and charged with all the liabilities conferred upon
and imposed by this act upon companies organized under the provisions
hereof: Provided, however. That no corporation created and organized
under the provisions hereof, or availing itself of the provisions hereof
as provided in section eleven, shall be authorized to transact the business
of a trust company, or any business of a fiduciary character, until it
shall have filed with the Comptroller of the Currency a copy of its certificate of organization and charter and shall have obtained from him
and filed the same for record with the said recorder of deeds a certificate
that the capital stock of said company has been paid in and the deposit
of securities made with said Comptroller in the manner and to the extent
required by this act.
190.
TRUST COMPANIES UNDER COMPTROLLER'S SUPERVISION.
(SEC. 6.) That all companies organized hereunder, or which shall under
the provisions hereof become entitled to transact the business of a trust
company, shall report to the Comptroller of the Currency in the manner
prescribed by sections fifty-two hundred and eleven, fifty-two hundred
and twelve, and fifty-two hundred and thirteen, Eevised Statutes of the
United States, in the case of national banks, and all acts amendatory
thereof or supplementary thereto, and with similar provisions for compensating examiners, and shall be subject to like penalties for failure
to do so. The Comptroller shall have and exercise the same visitorial
powers over the affairs of the said corporation as is conferred upon him
by section fifty-two hundred and forty of the Kevised Statutes of the
United States in the case of national banks. He shall also have power,
when in his opinion it is necessary, to take possession of any such company for the reasons and in the manner and to the same extent as are provided in the laws of the United States with respect to national banks.
191. POWERS OF THESE COMPANIES. (SEC. 7.) That all companies
organized under this act are hereby declared to be corporations possessed of the powers and functions of corporations generally, and shall
have power—
EEPORT OF THE COMPTROLLER OF THE CURRENCY.
47
First. Contracts.—-To make contracts.
Second. Suits.—To sue and be sued, iinplead and be impleaded, in
any court as fully as natural persons.
Third. Seal.—To make and use a common seal and alter the same at
pleasure.
Fourth. Loans.—To loan money.
Fifth. Special powers.—When organized under subdivision one of the
first section of this act to accept and execute trusts of any and every
description which may be committed or transferred to them, and to
accept the office and perform the duties of a receiver, assignee, executor, administrator, guardian of the estates of minors, with the consent
of the guardian of the person of such minor, and committee of the
estates of lunatics and idiots whenever any trusteeship or any such
office or appointment is committed or transferred to them, with their
consent, by any person, body politic or corporate, or by any court in the
District of Columbia, and all such companies organized under the first
subdivision o£ section one of this act are further authorized to accept
deposits of money for the purposes designated herein upon such terms
as may be agreed upon from time to time with depositors, and to act as
agent for the purpose of issuing or countersigning the bonds or obligations of any corporation, association, municipality, or State, or other
public authority, and to receive and manage any sinking fund on any
such terms as may be agreed upon, and shall have power to issue its
debenture bonds upon deeds of trust or mortgages of real estate to a
sum not exceeding the face value of said deeds of trust or mortgages,
and which shall not exceed fifty per centum of the fair cash value of
the real estate covered by said deeds or mortgages, to be ascertained
by the Comptroller of the Currency. But no debenture bonds shall be
issued until the securities on which the same are based have been
placed in the actual possession of the trustee named in the debenture
bonds, who shall hold said securities until all of said bonds are paid;
and when organized under the second subdivision of the first section
of this act said company is authorized to insure titles to real estate and
to transact generally the business mentioned in said subdivision; and
when organized under the third subdivision of section one of this act
said company is hereby authorized, in additiou to the loan and mortgage business therein mentioned, to secure, guaranty, and insure individuals, bodies politic, associations, and corporations against loss by or
through trustees, agents, servants, or employees, and to guaranty the
faithful performance of contracts and of obligations of whatever kind
entered into by or on the part of any person or persons, association,
corporation or corporations, and against loss of every kind: Provided,
That any corporation formed under the provisions of this act when
acting as trustee shall be liable to account for the amounts actually
earned by the moneys held by it in trust in addition to the principal so
held; but such corporation may be allowed a reasonable compensation
for services performed in the care of the trust estate.
192. COMPETENT TO ACT AS TRUSTEE, ETC. (SEC. 8.) That in all
cases in which application shall be made to any court in the District of
Columbia, or wherever it becomes necessary or proper for said court to
appoint a trustee, receiver, administrator, guardian of the estate of a
minor, or committee of the estate of a lunatic, it shall and may be
lawful for said court (but without prejudice to any preference in the
order of any such appointments required by existing law) to appoint
any such company organized under the first subdivision of section
one of this act, with its assent, such trustee, receiver, administrator,
48
REPORT OF THE COMPTROLLER OF THE CURRENCY.
committee, or guardian, with the consent of the guardian of the person
of such minor: Provided, however. That no court or judge who is an
owner of or in any manner financially interested in the stock or business of such corporation shall commit by order or decree to any such
corporation any trust or fiduciary duty.
193. QUALIFICATIONS OF SUCH TRUSTEE, ETC. (SEC. 9.) That
whenever any corporation operating under this act shall be appointed
such trustee, executor, administrator, receiver, assignee, guardian, or
committee as aforesaid, the president, vice-president, secretary, or treasurer of said company shall take the oath or affirmation now required by
law to be made by any trustee, executor, receiver, assignee, guardian,
or committee.
194. SECURITY FOR FAITHFUL PERFORMANCE OF TRUST. (SEC. 10.)
That when any court shall appoint the said company a trustee, receiver,
administrator, or such guardian, or committee, or shall order the deposit
of money or other valuables with said company, or where any individual
or corporation shall appoint any of said companies a trustee, executor,
assignee, or such guardian, the capital stock of said company subscribed
for or taken, and all property owned by said company, together with
the liability of the stockholders and officers as herein provided, shall
be taken and considered as the security required by law for the faithful performance of its duties, and shall be absolutely liable in case of
any default whatever.
195. PRIVILEGES EXTENDED TO EXISTING CORPORATIONS. (SEC.
11.) That any safe deposit company, trust company, surety or guaranty
company, or title-insurance company now incorporated and operating
under the laws of the United States or of the District of Columbia, or
any of the States, and now doing business in said District, may avail
itself of the provisions of this act on filing in the office of the recorder
of deeds of the District of Columbia, or with the Comptroller of the
Currency, a certificate of its intention to do so, which certificate shall
specify which one of the three classes of business set out in section one
it will carry on, and shall be verified by the oath of its president to the
effect that it has in every respect complied with the requirements of
existing law, especially with the provisions of this act; that its capital
stock is paid in as provided in section twenty-one of this act and is not
impaired, and thereafter such company may exercise all powers and
perform all duties authorized by any one of the subdivisions of section
one of this act in addition to the powers now lawfully exercised by such
company.
196. REAL ESTATE. (SEC. 12.) That any company operating under
this act may lease, purchase, hold, and convey real estate, not exceeding
in value five hundred thousand dollars, and such in addition as it may
acquire in satisfaction of debts due the corporation, under sales,
decrees, judgments, and mortgages. But no such association shall
hold the possession of any real estate under foreclosure of mortgage,
or the title and possession of any real estate purchased to secure any
debts due to it, for a longer period than five years.
197. PERIOD OF CORPORATIONS' EXISTENCE. (SEC. 13.) That the
charters for incorporations named in this act may be made perpetual,
or may be limited in time by their provisions, subject to the approval of
Congress.
198. PROVISIONS RELATING TO CAPITAL STOCK. (SEC. 14.) That
the capital stock of every such company shall be at least one million
dollars, and at least fifty per centum thereof must have been paid in,
in cash or by the transfer of assets as hereinafter provided in section
REPORT OF THE COMPTROLLER OF THE CURRENCY.
49
twenty-one of this act, before any such company shall be entitled to
transact business as a corporation, except with its own members, and
before any company organized hereunder shall be entitled to transact
the business of a trust company, or to become and act as an administrator, executor, guardian of the estate of a minor, or undertake any
other kindred fiduciary duty, it shall deposit, either in money or in
bonds, mortgages, deed of trust, or other securities equal in actual
value to one-fourth of the capital stock paid in, with the Comptroller
of the Currency, to be kept by him upon the trust and for the purposes
hereinafter provided; and the said Comptroller may from time to time
require an additional deposit from any such company, to be held upon
and for the same trust and purposes, not exceeding, however, in value
one-half the paid-in capital stock; and the said Comptroller shall not
issue to any corporation the certificate heretofore provided for until
said deposit with him of securities required by this section. Within
one year after the organization of any corporation under the provisions
of this act, or after any corporation heretofore existing shall have
availed itself of the powers and rights given by this act in the manner
herein provided for, its entire capital stock shall have been paid in.
199.
ENFORCEMENT OF SUBSCRIPTIONS TO STOCK. (SEC.
15.)
That the capital stock of every such company shall be divided into
shares of one hundred dollars each. It shall be lawful for such company to call for and demand from the stockholders, respectively, all
sums of money by them subscribed, at such time and in such proportions as its board of directors shall deem proper, within the time specified in section fourteen, and it may enforce payment by all remedies
provided by law; and if any stockholder shall refuse or neglect to pay
any installment as
required by a resolution of the board of directors,
after thirty days7 notice of the same, the said board of directors may
sell at public auction, to the highest bidder, so many shares of said
stock as shall pay said installment, under such general regulations as
may be adopted in the by-laws of said company, and the highest bidder
shall be taken to be the person who offers to purchase the least number
of shares for the assessment due.
200. ANNUAL EEPORT TO COMPTROLLER. (SEC. 16.) That every
such company shall annually, within twenty days after the first of
January of each year, make a report to the Comptroller of the Currency, which shall be published in a newspaper in the District, which
shall state the amount of capital and of the proportion actually paid,
the amount of debts, and the gross earnings for the year ending December thirty-first then next previous, together with their expenses, which
report shall be signed by the president and a majority of the directors
or trustees, and shall be verified by the oath of the president, secretary,
and at least three of the directors or trustees.
201. TAX ON GROSS EARNINGS. (SEC. 16). And said company shall
pay to the District of Columbia, in lieu of personal taxes for each next
ensuing year, one and a half per centum of its gross earnings for the
preceding year, shown by said verified statement, which amount shall
be payable to the collector of taxes at the times and in the manner that
other taxes are payable.
202. LIABILITY FOR FAILURE TO REPORT. (SEC. 17.) That if any
company fails to comply with the provisions of the preceding section,
all the directors or trustees of such company shall be jointly and severally liable for the debts of the company then existing, and for all that
shall be contracted before such report shall be made: Provided, That
ID case of failure of the company in any year to comply with the proH. Doc. 10
4
50
REPORT OF THE COMPTROLLER OF THE CURRENCY.
visions of section sixteen of this act, and any of the directors shall, on
or before January fifteenth of such year, file his written request for
such compliance with the secretary of the company, the Comptroller of
the Currency, and the recorder of deeds of the District of Columbia, such
director shall be exempt from the liability prescribed in this section.
203. PERJURY AND LARCENY. (SEC. 18.) That any willful false
swearing in regard to any certificate or report or public notice required
by the provisions of this act shall be perjury, and shall be punished as
such according to the laws of the District of Columbia. And any misappropriation of any of the money of any corporation or company formed
under this act, or any money, funds, or property intrusted to it, shall
be held to be larceny, and shall be punished as such under the laws of
said District.
204. TRANSFER OF STOCK. (SEC. 19.) That the stock of such company shall be deemed personal estate, and shall be transferable only on
the books of such company in such manner as shall be prescribed by
the by-laws of the company; but no shares shall be transferable until
all previous calls thereon shall have been fully paid, and the said stock
shall not be taxable, in the hands of individual owners, the tax on the
capital stock, gross earnings of the compa-ny hereinbefore provided
being in lieu of other personal tax. All certificates of the stock of any
company organized under this act shall show upon their face the par
value of each share and the amount paid thereon.
205. LIABILITY OF STOCKHOLDERS. (SEC. 20.) That all stockholders
of every company incorporated under this act, or availing itself of its
provisions under section eleven, shall be severally and individually liable to the creditors of such company to an amount equal to and in
addition to the amount of stock held by them, respectively, for all debts
and contracts made by such company.
206. MONEY PAYMENT OF CAPITAL STOCK EEQUIRED. (SEC. 21.)
That nothing but money shall be considered as payment of any part of
the capital stock, except that in the case of any company now doing
business in the District of Columbia in any of the classes herein provided for, or under any act of Congress or by virtue of the laws of any
of the States, and which company has actually received full payment in
money of at least fifty per centum of the capital stock required by this
act and which company desires to obtain a charter under this act, all
the assets or property may be received and considered as money, at a
value to be appraised and fixed by the Comptroller of the Currency:
Provided, That all such assets and property are also transferred to and
are thereafter owned by the company organized under this act.
207. NUMBER AND ELECTION OF DIRECTORS. (SEC. 22.) That the
stock, property, and concerns of such company shall be managed by not
less than nine nor more than thirty directors or trustees, who shall,
respectively, be stockholders and at least one-half residents and citizens
of the District of Columbia, and shall, except the first year, be annually
elected by the stockholders at such time and place and after such published notice as shall be determined by the by-laws of the company, and
said directors or trustees shall hold until their successors are elected
and qualified.
208. APPOINTMENT OF OFFICERS. (SEC. 23.) That there shall be a
president of the company, who shall be a director, also a secretary and
a treasurer, all of whom shall be chosen by the directors or trustees:
Provided, That only one of the above-named offices shall be held by
the same person at the same time. Subordinate officers may be
appointed by the directors or trustees, and all such officers may be
EEPORT OF THE COMPTROLLER OP THE CURRENCY.
51
required to give such security for the faithful performance of the duties
of their office as the directors or trustees may require.
209. BY-LAWS. (SEC. 24.) That the directors or trustees shall have
power to make such by-laws as they deem proper for the management
or disposal of the stock and business affairs of such company, not
inconsistent with the provisions of this act, and prescribing the duties
of officers and servants that may be employed, for the appointment of
all officers, and for carrying on all kinds of business within the objects
and purposes of such company.
210. DIRECTORS LIABLE FOR PAYMENT OF UNEARNED DIVIDENDS. (SEC. 25.) That if the directors or trustees of any company
shall declare or pay any dividend, the payment of which would render
it insolvent, or which would create a debt against such company, they
shall be jointly and severally liable as guarantors for all of the debts
of the company then existing, and for all that shall be thereafter contracted, while they shall, respectively, remain in office.
211. DIRECTORS 7 LIABILITY MAY BE AVOIDED. (SEC. 26.) That if
any of the directors or trustees shall object to declaring of such dividend or the payment of the same, and shall at any time before the time
fixed for the payment thereof file a certificate of their objection in writing with the secretary of the company and with the recorder of deeds
of the District they shall be exempt from liability prescribed in the preceding section.
212.
EESPONSIBILITY OF DIRECTORS FOR EXCESS LIABILITIES.
(SEC. 27.) That if the liabilities of any company shall at any time exceed
the amount of the fair cash value of the assets, the directors or trustees
of such company assenting thereto shall be personally and individually
liable for such excess to the creditors of the company after the additional liability of the stockholders has been enforced.
213. TRUSTEE, ETC., NOT LIABLE ON STOCK ASSESSMENT. (SEC. 28.)
That no person holding stock in such company as executor, administrator, guardian, or trustee shall be personally subject to any liability
as stockholder or such company, but the estate and funds in the hands
of such executor, administrator, guardian, or trustee shall be liable in
like manner and to the same extent as the testator or intestate or the
ward or the person interested in such trust fund would have been if
he had been living and competent to act and hold the stock in his own
name.
214. INCREASE OF CAPITAL. (SEC. 29.) That any corporation which
may be formed under this chapter may increase its capital stock by
complying with the provisions of this chapter to any amount which
may be deemed sufficient and proper for the purposes of the corporation.
215. CERTIFIED COPY OF INCORPORATION CERTIFICATE COMPETENT EVIDENCE. (SEC. 30.) That a copy of any certificate of incor-
poration filed in pursuance of this chapter, certified by the recorder of
deeds to be a true copy and the whole of such certificate, shall be
received in all courts and places as presumptive legal evidence of the
facts therein stated.
216. No BOND OR OTHER SECURITY EEQUIRED OF TRUST COMPANIES. (SEC. 31.) That no bond or other collateral security, except
as hereinafter stated, shall be required from any trust company incorporated under this act for or in respect to any trust, nor when appointed
trustee, guardian, receiver, executor, or administrator, with or without
the will annexed, committee of the estate of a lunatic or idiot, or other
fiduciary appointment; but the capital stock subscribed for or taken?
52
REPORT OF THE COMPTROLLER OF THE CURRENCY.
and all property owned by said company and the amount for which said
stockholders shall be liable in excess of their stock, shall be taken and
considered as the security required by law for the faithful performance
of its duties and shall be absolutely liable in case of any default whatever; and in case of the insolvency or dissolution of said company the
debts due from the said company as trustee, guardian, receiver, executor, or administrator, committee of the estate of lunatics, idiots, or any
other fiduciary appointment, shall have a preference.
217. DISTRICT SUPREME COURT HAS JURISDICTION OF TRUST COMPANIES. (SEC. 32.) That the supreme court of the District of Columbia,
or any justice thereof, shall have power to make orders respecting such
company whenever it shall have been appointed trustee, guardian,
receiver, executor, or administrator, with or without the will annexed,
committee of the estate of a lunatic, idiot, or any other fiduciary, and
require the said company to render all accounts which might lawfully
be made or required by any court or any justice thereof if such trustee,
guardian, receiver, executor, administrator, with or without the will
annexed, committee of the estate of a lunatic or idiot, or fiduciary
were a natural person. And said court, or any justice thereof, at any
time, on application of any person interested, may appoint some suitable person to examine into the affairs and standing of such companies,
who shall make a full report thereof to the court, and said court, or
any justice thereof, may at any time, in its discretion, require of said
company a bond with sureties or other securities for the faithful performance of its obligations, and such sureties or other security shall be
liable to the same extent and in the same manner as if given or pledged
by a natural person.
218.
A L L SIMILAR DISTRICT CORPORATIONS SUBJECT TO THIS
ACT. (SEC. 33.) That no corporation or company organized by virtue
of the laws of any of the States of this Union and having its principal
place of business within the District of Columbia, shall carry on, in the
District of Columbia, any of the kinds of business named in this act
without strict compliance in all particulars with the provisions of this
act for the government of such corporations formed under it, and each
one of the officers of the corporation or company so offending shall be
punished by fine not exceeding one thousand dollars, or imprisonment
in some State's prison not exceeding one year, or by both fine and
imprisonment, in the discretion of the court. This section shall not
take effect till six months after the approval of this act.
219. PROVISIONS FOR AMENDMENT. (SEC. 34.) That Congress may
at any time alter, amend, or repeal this act, but any such amendment
or repeal shall not, nor shall the dissolution of any company formed
under this act, take away or impair any remedy given against such
corporation, its stockholders or officers, for any liability or penalty
which shall have been previously incurred: Provided, That the courts
of the District of Columbia shall riot have power to appoint any trustee,
trustees, guardians, receivers, or other trustee of a fund or property
located outside of the District of Columbia, or belonging to a corporation or person having a legal residence or location outside of said
District,
BEPORT OF THE COMPTROLLER OF THE CURRENCY.
53
CHAPTER TEtf.
GOVERNMENT DEPOSITARIES.
220. Designation and duties of public 223. Penalty for misapplication of moneyorder funds.
depositaries.
221. Deposit and withdrawal of public 224. Penalty for unauthorized deposit of
public money.
moneys.
222. Provisions for deposits by certain 225. Penalty for unauthorized receipt or
use of public money.
postmasters.
220. DESIGNATION AND DUTIES OF PUBLIC DEPOSITARIES. (SEC.
5153.) All national banking associations, designated for that purpose
by the Secretary of the Treasury, shall be depositaries of public money,
except receipts from customs, under such regulations as may be prescribed by the Secretary; and they may also be employed as financial
agents of the Government; and they shall perform all such reasonable duties, as depositaries of public moneys and financial agents of
the Government, as may be required of them. The Secretary of the
Treasury shall require the associations thus designated to give satisfactory security, by the deposit of United States bonds and otherwise,
for the safe-keeping and prompt payment of the public money deposited
with them, and for the faithful performance of their duties as financial
agents of the Government. And every association so designated as
receiver or depositary of the public money shall take and receive at
par all of the national currency bills, by whatever association issued,
which have been paid into the Government for internal revenue, or for
loans or stocks.
221. DEPOSIT AND WITHDRAWAL OF PUBLIC MONEYS. (SEC. 3620.)
It shall be the duty of every disbursing officer having any public
money intrusted to him for disbursement to deposit the same with the
Treasurer or some one of the assistant treasurers of the United States,
and to draw for the same only as it may be required for payments to
be made by him in pursuance of law ; and draw from the same only in
favor of the persons to whom payment is made, and all transfers from
the Treasurer of the United States to a disbursing officer shall be
by draft or warrant on the Treasurer or an assistant treasurer of the
United States. In places, however, where there is no Treasurer or
assistant treasurer, the Secretary of the Treasury may, when he deems
it essential to the public interest, specially authorize in writing the
deposit of such public money in any other public depository, or, in
writing, authorize the same to be kept in any other manner and under
such rules and regulations as he may deem most safe and effectual to
facilitate the payments to public creditors.
222. PROVISIONS FOR DEPOSITS BY CERTAIN POSTMASTERS. (SEC.
3847.) Any postmaster, having public money belonging to the Government, at an office within a county where there are no designated depositaries, treasurers of mints, or Treasurer or assistant treasurers of the
United States, may deposit the same, at his own risk and in his official capacity, in any national bank in the town, city, or county where
the said postmaster resides; but no authority or permission is or shall
be given for the demand or receipt by the postmaster, or any other
person, of interest, directly or indirectly, on any deposit made as herein
described; and every postmaster who makes any such deposit shall
report quarterly to the Postmaster-General the name of the bank where
such deposits have been made, and also state the amount which may
stand at the time to his credit.
54
REPORT OF THE COMPTROLLER OF THE CURRENCY.
223. PENALTY FOR MISAPPLICATION OF MONEY-ORDER FUNDS.
(SEC. 4046.) Every postmaster, assistant, clerk, or other person employed in or connected with the business or operations of any moneyorder office who converts to his own use, in any way whatever, or loans,
or deposits in any bank, except as authorized by this Title, or exchanges
for other funds, any portion of the money-order funds, shall be deemed
guilty of embezzlement, and any such person, as well as every other
person advising or participating therein, shall, for every such offense,
be imprisoned for not less than six months nor more than ten years,
and be fined in a sum equal to the amount embezzled; and any failure
to pay over or produce any money-order funds intrusted to such person
shall be taken to be prima facie evidence of embezzlement; and upon
the trial of any indictment against any person for such embezzlement
it shall be prima facie evidence of a balance against him to produce a
transcript from the money-order account books of the Sixth Auditor.
But nothing herein contained shall be construed to prohibit any postmaster depositing, under the direction of the Postmaster-General, in a
national bank designated by the Secretary of the Treasury for that
purpose, to his own credit as postmaster, any money-order or other
funds in his charge, nor prevent his negotiating drafts or other evidences of debt through such bank, or through United States disbursing
officer, or otherwise, when instructed or required to do so by the Postmaster-General for the purpose of remitting surplus money-order funds
from one post-office to another, to be used in payment of money orders.
Disbursing officers of the United States shall issue, under regulations
to be prescribed by the Secretary of the Treasury, duplicates of lost
checks drawn by them in favor of any postmaster on account of moneyorder or other public funds received by them from some other postmaster.
224. PENALTY FOR UNAUTHORIZED DEPOSIT OF PUBLIC MONEY.
(SEC. 5488.) Every disbursing officer of the United States who deposits
any public money intrusted to him in any place or in any manner,
except as authorized by law, or converts to his own use in any way
whatever, or loans with or without interest, or for any purpose not
prescribed by law withdraws from the Treasurer or any assistant
treasurer, or any authorized depository, or for any purpose not prescribed by law transfers or applies any portion of the public money
intrusted to him, is, in every such act, deemed guilty of an embezzlement of the money so deposited, converted, loaned, withdrawn, transferred, or applied; and shall be punished by imprisonment with hard
labor for a term not less than one year nor more than ten years, or by
a fine of not more than the amount embezzled or less than one thousand
dollars, or by both such fine and imprisonment.
225. PENALTY FOR UNAUTHORIZED RECEIPT OR U S E OF PUBLIC
MONEY. (SEC. 54§7.) Every banker, broker, or other person not an
authorized depositary of public moneys, who knowingly receives from
any disbursing officer, or collector of internal revenue, or other agent
of the United States, any public money on deposit, or by way of
loan or accommodation, with or without interest, or otherwise than in
payment of a debt against the United States, or who uses, transfers,
converts, appropriates, or applies any portion of the public money for
any purpose not prescribed by law, and every president, cashier, teller,
director, or other officer of any bank or banking association, who violates any of the provisions of this section, is guilty of an act of embezzlement of the public money so deposited, loaned, transferred, used,
converted, appropriated, or applied, and shall be punished as prescribed
in section fifty-four hundred and eighty-eight.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
55
CHAPTER ELEVEff.
MISCELLANEOUS.
226. LEGAL TENDER AND LAWFUL MONEY.—The following statement concerning the legal-tender properties of money of the United
States is based upon United States Eevised Statutes, sections 3585,
3586, 3587, 3588, 3589, and 3590, and the acts amendatory thereof and
additional thereto:
Gold coin, standard silver dollars, subsidiary silver, minor coins,
United States notes, and Treasury notes of 1890 have the legal-tender
quality as follows: Gold coin is legal tender for its nominal value when
not below the limit of tolerance in weight; when below that limit it is
legal tender in proportion to its weight; standard silver dollars and
Treasury notes of 1890 are legal tender for all debts, public and private,
except where otherwise expressly stipulated in the contract; subsidiary
silver is legal tender to the extent of $10, minor coins to the extent of 25
cents, and United States notes for all debts, public and private^ except
duties on imports and interest on the public debt. Gold certificates,
silver certificates, and national-bank notes are nonlegal-tender money.
Both kinds of certificates, however, are receivable for all public dues,
and national-bank notes are receivable for all public dues except duties
on imports, and may be paid out for all public dues, except interest on
the public debt.
The term "lawful money" is understood to apply to every form of
money which is endowed by law with the legal-tender quality. (See
Opinions of Attorneys-General, vol. 17, p. 123.)
227. MISCELLANEOUS ACTS.—Be it enacted by the Senate and House
of Representatives oft the United States of America in Congress assembled.
That The First National Bank of Annapolis, now located in the city of
Annapolis and State of Maryland, is hereby authorized to change its
location to the city of Baltimore, in said State. Whenever the stockholders representing three-fourths of the capital of said bank, at a
meeting called for that purpose, determine to make such change, the
president and cashier shall execute a certificate, under the corporate
seal of the bank, specifying such determination, and shall cause the
same to be recorded in the office of the Comptroller of the Currency,
and thereupon such change of location shall be effected, and the operations of discount and deposit of said bank shall be carried on in the
city of Baltimore.
SEC. 2. That nothing in this act contained shall be so construed as in
any manner to release the said bank from any liability or affect any
action or proceeding in law in which the said bank may be a party or
interested. And when such change shall have been determined upon,
as aforesaid, notice thereof, and of such change, shall be published in
two weekly papers in the city of Annapolis not less than four weeks.
SEC. 3. That whenever the location of said bank shall have been
changed from the city of Annapolis to the city of Baltimore, in accordance with the first section of this act, its name shall be changed to The
Traders' National Bank of Baltimore, if the board of directors of said
bank shall accept the new name by resolution of the board, and cause
a copy of such resolution, duly authenticated, to be filed with the
Comptroller of the Currency.
SEC. 4. That all the debts, demands, liabilities, rights, privileges, and
powers of The First National Bank of Annapolis shall devolve upon
56
REPORT OF THE COMPTROLLER OF THE CURRENCY.
The Traders' National Bank of Baltimore whenever such change of
name is effected.
SEC. 5. That this act shall take effect and be in force from and after
its passage.
Approved, June 7,1872.
Acts of a similar nature to the one preceding have been enacted by
Congress for the following purposes:
Authorizing The Manufacturers' National Bank of New York to
change its location from the city of New York to the city of Brooklyn.
(Approved July 27,1868.)
Authorizing The City National Bank of New Orleans, Louisiana, to
change its name to The Germania National Bank of New Orleans.
(Approved March 1,1869.)
Authorizing The Second National Bank of Plattsburgh, New York,
to change its name to The Vilas National Bank of Plattsburgh. (Approved March 1,1869.)
Authorizing The First National Bank of Delhi, New York, to change
its location and name to The First National Bank of Port Jervis, New
York. (Approved May 5,1870.)
Authorizing The First National Bank of Fort Smith, Arkansas, to
change its location and name to The First National Bank of Oamden,
Arkansas. (Approved July 1,1870.)
Authorizing the Jersey Shore National Bank, Pennsylvania, to
change its location* and name to The Williamsport National Bank, Pennsylvania. (Approved December 22,1870.)
Authorizing the Worcester County National Bank of Blackstone,
Massachusetts, to change its location and name to The Franklin
National Bank, Massachusetts. (Approved February 9, 1871.)
Authorizing The Farmers' National Bank of Fort Edward, New York,
to change its location and name to The North Granfille National Bank,
New York. (Approved February 18, 1871.)
Authorizing The Worthington National Bank of Cooperstown, New
York, to change its location and name to The First National Bank of
Oneonta, New York, (Approved February 27,1871.)
Authorizing The Warren National Bank of South Danvers, Massachusetts, to change its name to The Warren National Bank of Peabody,
Massachusetts. (Approved March 12,1872.)
Authorizing The First National Bank of Seneca, Illinois, to change
its location and name to The First National Bank of Morris, Illinois.
(Two acts, approved April 5,1872, and June 18, 1874.)
Authorizing The Eailroad National Bank of Lowell, Massachusetts,
to change its location and name to The Eailroad National Bank of
Boston, Massachusetts. (Approved May 31,1872.)
Authorizing The National Bank of Lyons, Michigan, to change its
location and name to The Second National Bank of Ionia, Michigan.
(Approved December 24,1872.)
Authorizing The East Chester National Bank of Mount Vernon, New
York, to change its location and name to The German National Bank of
Evansville, Indiana. (Approved January 11,1873.)
Authorizing The First National Bank of Newnan, Georgia, to change
its location and name to The National Bank of Commerce, Atlanta,
Georgia. (Approved January 23,1873.)
Authorizing The First National Bank of Watkins, New York, to
change its location and name to The First National Bank of Penn Yan,
Hew York. (Approved February 19,1873.)
REPORT OF THE COMPTROLLER OF THE CURRENCY.
57
Authorizing The National Bank of Springfield, Missouri, to change its
Dame to The First National Bank of Springfield, Missouri. (Approved
March 3,1873.)
Authorizing The Kansas Valley National Bank of Topeka, Kansas, to
change its name to The First National Bank of Topeka, Kansas. (Approved March 3,1873.)
Authorizing The First National Bank of Saint Anthony, Minnesota,
to change its location and name to The Merchants' National Bank of
Minneapolis, Minnesota. (Approved January 8,1874.)
Authorizing The Second National Bank of Havana, New York, to
change its name to The Havana National Bank of Havana, New York.
(Approved January 9,1874.)
Authorizing The Passaic County National Bank of Paterson, New
Jersey, to change its name to The Second National Bank of Paterson,
New Jersey. (Approved April 15,1874.)
Authorizing The Citizens' National Bank of Hagerstown, Maryland,
to change its location and name to The Citizens' National Bank of
Washington City, District of Columbia. (Approved May 1,1874.)
Authorizing The Irasburg National Bank of Orleans, at Irasburg,
Vermont, to change its location and name to The Barton National
Bank, Vermont. (Approved June 3,1874.)
Authorizing The Farmers' National Bank of Greensburg, Pennsylvania, to change its location and name to the Fifth National Bank of
Pittsburg, Pennsylvania. (Approved June 23,1874.)
Authorizing The Citizens' National Bank of Sanbornton, New Hampshire, to change its name to The Citizens' National Bank of Tilton,
New Hampshire. (Approved February 19,1875.)
Authorizing The Second National Bank of Jamestown, New York, to
change its name to The City National Bank of Jamestown, New York.
(Approved March 3,1875.)
Authorizing The Second National Bank of Watkins, New York, to
cb ange its name to The Watkin s National Bank, New York. (Approved
March 3,1875.)
Authorizing The Slater National Bank of North Providence, Ehode
Island, to change its name to The Slater National Bank of Pawtucket,
Ehode Island. (Approved March 3,1875.)
Authorizing The Auburn City National Hank of Auburn, New York,
to be consolidated with The First National Bank of Auburn, New York.
(Approved March 3,1875.)
Authorizing The Miners' National Bank of Braidwood, Illinois, to
change its location and name to The Commercial National Bank of
Wilmington, Illinois. (Approved January 31, 1878.)
Authorizing The Windham National Bank, Windham, Connecticut,
to change its location to the village of Willimantic, Connecticut. (Approved February 10,1879.)
Authorizing The National Bank of Commerce of Cincinnati, Ohio,
to change its name to The National Lafayette and Bank of Commerce.
(Approved April 29,1879.)
Authorizing The City National Bank of Manchester, New Hampshire,
to change its name to The Merchants' National Bank of Manchester.
(Approved June 11,1880.)
Authorizing The Blue Hill National Bank of Dorchester, Massachusetts, to change its location and name to The Blue Hill National Bank
of Milton, Massachusetts. (Approved January 13,1881.)
Authorizing The First National Bank of Meriden, West Meriden,
Connecticut, to change its name to The First National Bank of Meriden,
Connecticut. (Approved March 1,1881.)
58
REPORT OF THE COMPTROLLER OP THE CURRENCY.
Authorizing The National Mechanics7 Banking Association of New
York, New York, to change its name to Wall Street National Bank.
(Approved February 14,1882.)
Authorizing The Lancaster National Bank of Lancaster, Massachusetts, to change its location and name to The Lancaster National Bank
of Clinton, Massachusetts. (Approved February 25,1882.)
Authorizing The National Bank of Kutztown, Pennsylvania, to change
its location and name to The Keystone National Bank of Beading, Pennsylvania. (Approved June 27,1882.)
Joint resolution authorizing The National Bank of Winterset, Iowa,
to change its name to The First National Bank of Winterset, Iowa.
(Approved January 18,1883.)
Authorizing The Second National Bank of Xenia, Ohio, to increase
its capital stock. (Approved February 17,1883.)
Authorizing The First National Bank of West Greenville, Pennsylvania, to change its name to The First National Bank of Greenville,
Pennsylvania. (Approved February 26,1883.)
Authorizing The West Waterville National Bank of Oakland, Maine,
to change its title to The Messalonskee National Bank of Oakland,
Maine. (Approved April 15,1884.)
Authorizing The Hillsborough National Bank, Ohio, to change its
name to The First National Bank of Hillsborough, Ohio. (Approved
December 18,1884.)
Authorizing The Slater National Bank of North Providence, Ehode
Island, to change its name. (Approved January 8,1885.)
Authorizing The First National Bank of Omaha, Nebraska, to increase
its capital stock. (Approved January 10,1885.)
Authorizing The National Bank of Bloomington, Illinois, to change
its name to The First National Bank of Bloomington, Illinois. (Approved
January 27,1885.)
Authorizing The Manufacturers' National Bank of New York to
change its name to The Manufacturers* National Bank of Brooklyn,
New York. (Approved February 20,1885.)
Authorizing The Commercial National Bank of Chicago, Illinois, to
increase its capital stock. (Approved February 28,1885.)
Authorizing The First National Bank of Larned, Kansas, to increase
its capital stock. (Approved March 3,1885.)
Authorizing The First National Bank of Fort Benton, Montana, to
change its location and name. (Approved December 18,1890.)
Authorizing a national bank at Chicago, Illinois, to establish a branch
office upon the grounds of the World's Columbian Exposition. (Approved May 12,1892.)
Authorizing The First National Bank of Sprague, Washington, to
change its location and name. (Approved March 20,1896.)
Authorizing the Interstate National Bank of Kansas City, Kansas,
to change its location. (Approved March 2,1897.)
INDEX TO NATIONAL-BANK ACT.
Paragraph. Page.
A.
Acknowledgment. (See Oath.)
Acts, miscellaneous :
Synopsis of
an..
Administrator. (See Trustee.)
Advertisements (see also Notice; Publication):
Imitation of circulation in, penalty for
Agent:
Bonds, examination by
Central reserve
Central reserve, additional
Circulation, to witness destruction
National banking associations as fiscal, of Government
Reserve
Reserve, additional, provisions for
Reserve, central
Reserve, additional central, provisions for
Shareholders, appointment and qualification of
Shareholders, duties of
Allotment. (See Shares.)
Amendments:
Proposed to act in Comptroller's report
Restriction of, to articles of national banking associations
Appointment:
Committee to examine bonds
Committee to examine plates, etc
Committee to witness destruction of circulation
Comptroller
Deputy Comptroller
Directors of associations
Dissenting shareholders, committee of appraisal
Examiners of associations
Office clerks
Officers of associations
Receivers of .associations
Special commission for preliminary examination ol associations.
Yacancies in board of directors
Appraisal. (See Shares.)
Articles of association:
Amendment of, for extension of corporate existence
Amendment of, restricted
Execution of, by converted State banks
Increase of capital stock by amendment of
Provisions for elections when not provided for in
Reduction of capital stock
Specification of object of association in
Title and location, change of
Assessments:
Examinations
Impairment of capital
Plates, engraving of
Redemption of circulation
Repayment of
Reports, failure to make
Shareholders' personal liability
Assessors:
Shareholders' lists accessible to
Assets:
Comptroller's report to contain statement of national banks
Expenses of receiver paid from
Insolvent banks, distribution of
Receiver to collect, etc
Reports of condition to contain statement of
Shareholders' agent to distribute
Assignment. (See Treasurer United States; Bonds, United States.)
Assistant Treasurer United States:
Circulation, unfit, to be sent to Treasurer for redemption
Fraudulent notes to be marked by
Obligations of United States
Public moneys deposited with
Unauthorized withdrawal of public money from
Associations:
Defined
•
Attachment:
Notto issue prior to final judgment
227
55
166
40
56
103
105
65
220
91
104
103
105
160
161
14
24
25
16
53
23
24
24
25
37
38
10
42
4
11
56
62
65
3
5
16
135
125
7
16
151,152
25
33
14
15
16
3
3
6
31
29
4
6
35
8
9
132
42
37
43
32
45
13
46
31
11
10
11
9
11
5
11
29
127
115,116
27
66,69 16,18
6,68,69 16,17,18
161
122
40,151
38
28
10,35
118
27
10
155
154
151
119
161
36
36
35
28
38
66
79
169
221,222
224
16
19
41
53
54
92
22
162
39
59
4
60
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-bank act—Continued.
Auction:
Bonds of expiring associations
Bonds of liquidating associations
Enforcement of assessment
Purchase of property by receiver
Sale of delinquent stock
Sale of dissenting shareholder's stock
Authority. (See Certificate.)
Paragraph.
Page.
141,148
140,148
116
i
158
20
135
33,34
32,34
27
36
7
31
B.
Bad debts:
26
Defined
114
Ballot. (£ee Elections; Shareholders.)
Bank circulation. (See Circulation.)
Bills of exchange:
162
Illegal transfer of
107
25
Interest on
43
178
Penalty for official malfeasance, relative to
26
110
Restriction on loans, not applicable to
26
112
Restriction on associations' liability, not applicable to
162
Transfer of, to create a preference, void
Bonds, official:
3
4
Comptroller
3
5
Deputy Comptroller
6
16
Officers of associations
53
220
Public depositaries
35
151
Receiver
37
160
Shareholders' agent
37
160
Shareholders', on election of agent
Bonds, United States:
14
56
Annual examination of, provided for
13
52
Assignment or transfer of, to be countersigned by Comptroller
13
54
Association to be notified of transfer or assignment
17
68
Called for redemption
34
147
Cancellation of, forfeited, for circulation redeemed
34
49 |
Circulation issuable on
36
58
Circulation obtainable on
...
Comptroller to have access for examination to records and, deposited with
55 ! 36
Treasurer.
10
37 i
Converted State banks to comply with provisions of law relative to .
.1
13
51 !
Coupon, to be exchanged for registered
:
34
149
Deficiency in proceeds from sale of, what first lien
12
48
Defined
8,12
24,49
Deposit of, required of associations prior to beginning business
14
57
Depreciation in value of, how made good
53
220
Depositaries required to deposit
14
57
Exchange of, permitted
33
143
Forfeiture of, for failure to redeem circulation
14
57
General provisions respecting
16
64
Gold banks to deposit
53
220
Government depositaries, deposit of, required
13
50
Increase of deposit of
20
81
Interest on, liable for penalty for failure to make tax returns and pay tax
28
122
Interest on, liable for penalty for failure to make reports to Comptroller
17
67
Lawful money, deposit of, to retire circulation and withdraw
14
58 i
Maximum amount which may be deposited to secure circulation
16
64
Maximum circulation issuable on, to gold banks
:
8,12
24,49
Minimum amount to be deposited
41
169
Obligations of United States, including, defined
42
174
Penalty forillegal dealing in counterfeit
41
170
Penalty for illegal possession or use of material for printing
42
171
Penalty for passing counterfeit
Penalty for taking or possessing unauthorized impressions of tools, etc., used in
42
172,173
printing, etc
32
140
Reassignment of, to liquidating bank
13
53
Record of transfer or assignment of, to be kept in office of Comptroller
12
49
Registered, to be deposited with Treasurer United States
13
50
Relation ot, on deposit to capital
14
57
Return of, to association
34
148
Sale of, at auction for failure to redeem circulation
34
150
Sale of, privately, at not less than par, for failure to redeem circulation
22
91
Taxation, exempt from all
13
52
Transfer of, how effected
13
55
Treasurer United States to have access to records of Comptroller relative to
13
52
Treasurer United States to hold, in trust for association
17
67
Withdrawal of, and of circulation
13
50
Withdrawal of
Bookkeeper. (See Officers.)
Books. (See Comptroller; Treasurer United States.)
Borrowed money. (See Liability of Association; Loans.)
Branches:
10
Converted banks may retain
61
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-bank act—Continued.
Business:
Authorization of association to begin, when
Suspension of, after default to pay circulation
Business paper. (See Commercial paper.)
By-laws:
Prescribed by directors of national banks
C.
Cancellation. (See Bonds, United States; Circulation.)
Capital stock:
Agent of shareholders to distribute assets ratably
Appointment and qualification of shareholder's agent
Approval of Secretary required, when
Association organized to begin business, when
Branches of converted State banks
Certificate of officers and directors required relative to payment of
Circulation outstanding not exceeding 5 per cent of, free from taxation
Compensation of examiners based on, except in certain cases
Conversion of State banks authorized, when
Creditor's bill against shareholders
Deposit of United States bonds based on
Directors, individual liability of
Directors, qualifications of
»
Dividends declared on, and net earnings in excess of dividends to be reported.
Dividends on, and creation of surplus
Dividends on, when prohibited
Disposition of, delinquent shareholders
Division of, into shares and number and value of each
Duties of agent of shareholders
Enforcment of assessment, to make good impairment of
Enforcing individual liability of shareholders of, by receiver
Enforcing payment of
Failure to dispose of shares of, purchased or acquired by associations
Holders of shares of, in expiring associations to be extended or reorganized to
have preference in the allotment of shares
Holding of shares of, required by directors
Impairment of, assessment for
Impairment of, receiver may be appointed for failure to make good
Increase of, provisions for
Liabilities of an association not to exceed, except on account of certain demands..
Liquidation, shareholders owning two-thirds of, may vote to go into
List of shareholders of, to be transmitted to the Comptroller
Loan on security of shares or purchase of, prohibited
Loans restricted to 10 per cent of
Minimum amount required of national banks
Number of shares and amount of, stated in organization certificate
Payment of, provisions for
Penalty for failure to make good impairment of
Personal liability of shareholders
Receiver may be appointed when—impaired
Receiver may be appointed when, not fully paid in
Reduction of, provisions for
.
Relation of bond deposit to
Restoration of, when below the minimum required
Shareholders of, list to be kept and subject to inspection
Shareholders owning two-thirds of, may place an association in liquidation
Shareholders owning two-thirds of, may change title and location
Shareholders owning two-thirds of, may increase stock
,
Shareholders owning two-thirds of, may reduce stock
Shareholders owning two-thirds of, may extend corporate existence
Shareholders entitled to one vote on each share of, held by
Shareholders of converted State banks not liable when
Shareholders of, not consenting to an extension may withdraw
Shares of, acquired for debt to be disposed of when
Savings and other banks organized in the District of Columbia under act of Congress subject to provisions of this act
Savings banks now established not required to have, exceeding $100,000
State banks converted into national shall be assumed to have the same, as immediately prior to conversion
State taxation of shares of
Surplus fund to be created to the amount of 20 per cent of
United States registered bonds to be deposited as security for circulation to be
based on
When increase of, becomes valid
Withdrawal of bonds on reduction of, or closing of business
Withdrawal of bonds, limited
Cashier (seealso President; Officers) :
Bond assignments by
Certificate of officers and directors
Certificate of stock payment
»
19
146
7
34
16
161
160
17
19
39
38
37
6
7
85
127
37
163
24
557
28
121
109
114
20
18
161
116
152
20
152
10
7
20
29
10
39
8
36
8
28
26
26
7
6
38
27
35
7
35
135
31
115
152
43
112
136
118
111
110
17
14
19
115
40
115
152
45
50
21
118
136
46
43
45
132
30
40
135
111
29
9
27
35
11
26
32
27
26
26
6
5
7
27
10
27
35
11
13
7
27
32
11
11
11
31
9
10
31
26
123
123
28
28
38
124
109
10
29
26
49
44
50
57
12
11
13
19,23
52
23
19
14
13
7
7
62
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-bank act—Continued.
Page.
Cashier (see also President; Officers)—Continued.
Election or appointment of
Expiration of corporaie existence, certification by
Extension of corporate existence, certification by
False certification of checks
,
Incomplete circulation, provisions relative to
Increase of stock, certification of
Penalty for—
Countersigning or delivering circulation improperly
False certification of checks
Issuing circulation of expired associations
Officialnialfeasance
Pledging, etc., circulation
Unauthorized receipt of public money
President or vice-president and, to sign circulation
Protest of circulation, waiving notice of
Proxy, not to act as
Reports of condition, verified by
Reports of earnings and dividends, verified by
Shareholders, lists of, by
Signature of, forged or wanting, not to invalidate circulation
Taxable circulation, returns by
Unauthorized circulation, returns by
Voluntary liquidation, certified by
Central reserve agents. (See Agent; Reserve; Reserve agents.)
Certificate:
Certified copy of organization, evidence
Comptroller's, of authority
Converted State banks
Execution of organization
Extension of corporate existence
*
Increase of stock valid, when
May be withheld, when
Officers and directors
Organization, to specify
Payment of installments of stock to be certified
Publication of Comptroller's, of authority
'.
Reduction of stock valid, when
Sealed, of Comptroller, evidence
Voluntary liquidation
Certified copies. (See Evidence.)
Charter number:
Circulation, to be printed on
Checks:
False certification of, unl awful
Falsely certified, an obligation of association
Penalty for false certification of
Circulation:
Amount of, obtainable
>••
Amount of, obtainable by gold banks
Association may issue
Association to receive interest on bonds as long as, honored
Associations consolidating, deposit of lawful money lo retire, unnecessary—
Associations to redeem, in lawful money on demand
Bonds in excess of amount required may be withdrawn
Bonds forfeited when, dishonored
Certificates of destruction, by whom executed
Charter number on
Collection of tax on
Cost of engraved plates to be paid by association
Counterfeiting, etc
Deposit of United States bonds to secure
Deposit to be increased when capital is increased
Destroyed, to be replaced by an equal amount of new notes
Disposition of redemption account balances
Examination of bank upon protest of, by agent of Comptroller
Expense of plates for new notes of extended banks
Expenses of redeeming, withdrawn
Expenses of redemption, how paid
Extended bank, shall differ from prior issues
For what, is receivable
Fraudulent n'otes to be so stamped
Gold bank, to be redeemed in gold coin
Government depositaries to receive, at par
Inscription on
Increasing capital stock, use of, prohibited
Liquidating bank to deposit lawful money to redeem
Maximum deposit of bonds required
Minimum deposit of bonds required
Notice of redemption of, to be forwarded to bank
Other, prohibited for national bank
16
141
132
176
76
44
0
33
31
43
19
11
164
177
175
178
165
225
59
142
30
119
121
118
76
81
86
137
40
43
43
43
40
54
15
182
25
37
15
132
44
25
23
14
19
26
45
181
137
44
8
10
6
31
11
8
7
5
7
8
11
44
32
28
28
27
19
20
21
32
60
15
176
376
177
43
43
43
49,58
12,14
64
16
57
139
103
50
143
65
59
83
66
16
6
14
32
24
13
33
16
15
20
16
164-175
24,49
40,43
8,12
50
66
75
143
69
69
66
69
63
79
64
220
13
16
19
33
18
18
16
18
15
19
16
53
59,64
15,16
113
140
49
49
66
78
26
82
12
12
16
19
REPORT OF THE COMPTROLLER OF THE CURRENCY.
63
Index to national-bank act—Continued.
Paragraph. Page.
Circulation—Continued.
20
81
Penalty for failure to make return of taxable
14
58
Preparation of
26
113
Pledging, as security prohibited
18
Profit on unredeemed, inures to the United States.
21
Proceedings when return is not made
27
Prohibition against circulating uncurrent notes
117
33
142
Protest of
19
77 i
Receivable at par by all national banks
20
84
Refunding excess tax
18
73
Redeemed, to be canceled
16
66
Redemption fund of 5 per cent
16
Redemption of, in United States notes
18
Redemption of, extended bank
18
70
Redemption of, liquidating banks
18
71
Redemption of, closed banks.
19
76
Redemption of, incomplete ...
21
90
Restriction of tax provisions
81,87 20,21
Semiannual return of, subject to tax
4
10
Statement concerning, of closed banks to appear in annual report of Comptroller.
22
91
Securities exempt frcm local taxation
20
80
Tax on
21
86
Tax on unauthorized
21
89
Tax on converted bank
37
159
Tax on, insolvent banks remitted
IS
71
Treasurers and public depositaries to return all, of closed banks
20
85
When exempt from tax
15
63
When' issuable as money
17
68
When withdrawn, new will not be issued for six months thereafter
17
67
Withdrawal of, by depositin g lawful money
16
65
Worn out or mutilated, destroyed
,
Citizens:
180
44
National-banking associations, where
Claims. (See Insolvency; Receiver.)
Clearing house:
97
23
Certificates issued by, counted as reserve
101
24
Receipt in settlement of balances of gold and silver certificates by
Clearing-house certificates. (See Clearing house; Reserve.)
Clerks;
Appointment and qualification of, by the Secretary
i !
Duties of, fixed by the Comptroller
7
Employment of, for the Bureau by the Comptroller
7
10
Names and compensation of, in annual report
Coin. (SeeGold; Silver.)
Commercial paper:
107,112 25,26
Discount of.
»*«
Committee of appraisal. (See Dissenting shareholders.)
Comptroller of the Currency:
Agent, special, to be appointed for association failing to redeem circulation
143
33
Annual report to be made to Congress by
10
4
3
3
Appointment, term and salary ot
Articles of association and organization certificate of national banks to be filed
13,14
5
Authorized to examine banks in the District of Columbia, organized under acts
128
30
of Congress
Bonds, sale of, privately or at public auction by
150
34
43,45
11
Capital stock, increase or reduction of, to be approved by.
95,151 23,25
Circulation, worn, mutilated, destruction of
5
12
Distribution of Comptroller's reports
3
2
Duties of
29
125
Examiners, appointment of
30
131
Extension of corporate existence, approval of, by
44
181
Evidence sealed certificates
36
156
Forfeiture of charter, suit to be brought by
9
35
Gold banks, organization of
4
6
Interest in national banks, issuing currency, prohibited .
44
179
Jurisdiction of circuit courts
32
137
Liquidation of associations to be approved by
153
36
Notice to creditors of insolvent banks
3
4
Oath to be taken and bond to be given by
5
11
PrintiDg report of..
62
15
Lies, examination of
Plates and dies
4
3
Qualifications of
95,151 23,35
Receivers appointed by
123
28
Reports of banks other than national to be obtained and published by.
119,121
28
Reports to be made to .
104,105 24,25
Reserve cities, designation of, by
State banks converted, approval by
37
10
46
11
Title and location, change of, to be approved by.
14
Title of national banks subject to approval of
5
Congress:
Comptroller's report to be made to
10
64
EEPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-bank
act—Continued.
Paragraph.
Consolidation:
Provision s for liquidation on
Corporate powers. (Ulee Powers.)
Corporation (see also Liability of association):
Association becomes a, when
Cost. (See Expenses.)
Coupon bonds. (See Bonds, United States.)
Courts. (See Crimes, jurisdiction, etc.)
Creditors:
Bill in equity by, against shareholders
,
Checks falsely certified a valid obligation of associations
Directors' liability
Expiration of existence, notice to
Illegal preference of
Insolvency, notice of, to
,
Nonpayment of circulation, notice of, to
Shareholders' agent, following settlement with
Shareholders, list of, subject to inspection by
Shareholders, personal liability of, to
Voluntary liquidation, notice of, to
Creditor's bills:
A gainst shareholders
Crimes, jurisdiction, etc.:
Counterfeiting circulation
Dealing in counterfeit circulation
Evidence, certified copy of organization certificate
Evidence, sealed certificate of Comptroller competent
False certification of checks
Having or taking unauthorized impressions of tools, etc
Illegal possession or use of material for circulation
Imitating circulation for advertising purposes
Improper countersigning or delivering circulation
Indian Territory
Issuing circulation of expired associations
Jurisdiction, general, of national-bank cases
Jurisdiction to enjoin Comptroller or receiver
Mutilating circulation
.
Obligations of the United States defined
Official malfeasance
Passing counterfeit circulation
,
Pledging United States notes or bank circulation
Suits against United States officers or agents
Taking unauthorized impression of tools, etc
Currency. (See Circulation: Gold; Gold certificates; Silver; Silver certificates
Lawful money; United States note certificates.)
Currency bureau:
Designation of office of Comptroller of the Currency
,
Oflices, vaults, etc., for
Page.
139
32
16
6
163
176
157
141
162
153
147
160
118
40
137
39
43
36
33
39
36
34
37
27
10
32
163
168
174
182
181
176,177
172,173
170
166
164
184
175
180
179
167
169
178
171
165
183
172
41
42
44
44
43
42
41
40
40
44
43
44
44
41
41
43
42
40
44
42
64
59
101
16
15
24
18,37
6,10
23
B.
Deficiency. (SeeBonds; Capital; Circulation; Receiver; Reserve.)
Denominations:
Circulation of gold banks
Circulation of national banks
Gold certificates
Shares of national-bank stock
United States note certificates
Deposit of United States bonds. (See Bonds, United States.)
Depositaries. (See Government depositaries.)
Depreciation. (See Bonds; Circulation.)
Deputy Comptroller:
# Appointment of
Bond of
Duties of
Interest in bank issuing national currency prohibited by
Oath to be taken
Salary of
Destruction. (See Redemption.)
Dies. (See Plates and dies.)
Directors:
Assessment, provisions for enforcement of, by
Association to elect or appoint
Attestation of reports to Comptroller, by
Certificate of officers and
Certification of, to extension
Conversion of State bank, action by
Dividends, declaration of, by ,
Enforcing payment of capital
Failure to hold annual election
Forfeiture of charter for violation, etc., by
Indian Territory, national-bank act relative to, in effect in
99
j
5
,
5
5
5
6
5
5
3
3
3
4
3
3
116
16
119
23
132
37
109
20
32
156
27
6
28
7
28
10
26
184
44
7
9
36
REPORT OF THE COMPTROLLER OF THE CURRENCY.
65
Index to nationaVbarik act—Continued.
Page.
Directors—Continued.
Individual liability of
157
Names and residences of, to be ascertained by Comptroller
22
Number and election of
27
Oath of
31
Oklahoma, qualification of national bank, in
29
Penalty for issuing circulation of expired association
.'
175
Penalty for official malfeasance
178
Penalty for unauthorized receipt of public money
225
President of board, to be a
34
Powers of
16
Qualifications of
28
Qualifications of, in Oklahoma
29
Shareholders dissenting to extension to give no tice to, etc
135
Vacancies in board of
33
Discount. (SeeLoans; Liability of association; Interest.)
Dissenting shareholders:
Withdrawal of, on extension
135
Dissolution. (See Expiration of corporate existence; Forfeiture; Insolvency; Liquidation.)
Distinctive paper:
Unauthorized possession or use of
170 :
District of Columbia:
Supervision of banks in, authorized by Congress, by Comptroller
128 '
Dividends (see also Surplus and dividends):
Comptroller to make ratable, of assets of insolvent banks
154
Directors may declare, when
109
Earnings and, to be reported
121
Penalty for failure to report earnings and
122
Restriction on association's liability
112
Unearned, prohibited
114
Drafts:
169
Obligations of United States including
Official malfeasance
178
Liability of association, relative to
112
Penalty for mutilating
167
Dues. (See Taxation; Duties.)
Duties:
Associations organized under act of February 25,1863...*»* *
47
Circulation, converted State banks
89
Circulation, enforcing payment of, on
83
Circulation, exempt from".
85
Circulation, not receivable for customs
63
Circulation, refunding excess on
84
Circulation, restriction s on
90
Circulation, semiannual on
80
Circulation, unauthorized
86
Comptroller's
2
Deputy Comptroller's
5
Directors'
27,31
Examiners'
125
Gold certificates receivable for
101
Notes, etc., other than national-bank circulation
91
Public depositaries, designation and
220
Receiver, appointment and
151
Shareholders'agent
,,.,,.,,
161
E.
Earnings. (See Dividends.)
Elections:
46
Change of title or location
<<<.....«*....*.......,.............»....
Corporate powers
16
Extension of corporate existence
131
Failure to hold annual
32
Increase of stock
43
Number of directors
27
Oaths of directors
31
Qualifications of directors
28
Qualifications of shareholders
30
Reduction of stock
45
Shareholders'agent
160
Voluntary liquidation
136,137
Embezzlement. (See Crimes.)
Embezzlement, misapplication of funds, etc.:
178
Penalty for
Employees and expenses. (See Clerks; Expenses.)
Enforcing payment of capital stock:
20
Provisions for
Engraving. (See Circulation; Plates and dies.)
Equity. (See Creditor's bill against shareholders.)
Examination of organization proceedings:
22
Preliminary to authorizing, to begin business
>
H. Doc. 10
5
3G
7
8
9
8
43
43
54
9
6
8
8
31
9
31
41
36
26
28
28
26
26
41
43
26
41
12
21
20
20
15
20
21
20
21
3
3
8,9
29
24
22
53
35
38
11
6
30
9
11
8
9
8
9
11
37
32
43
66
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to naHanaUhanh act—Continued.
Paragraph. Page.
Examinations:
Annual,of bonds
•
Ascertainment of value of stock of dissenting shareholders
,
Bonds and records, provisions for
,
Compensation of examiners
,
Comptroller may make, of all banks in the District of Columbia organized under
acts of Congress
Examiners to make
Limitation of visitorial powers
List of shareholders subject to
Plates and dies annually
Preliminary, to beginning business
,
Qualification of examiners
,
Special, of extended associations
,
Examiners:
Appointment of
Compensation of
Qualifications of
Special commission
,
Execution. (See Suits.)
Executor. (See Trustee.)
Existence:
Extension of
Term of corporate, of national banks
Expenses:
Bureau, to be stated in Comptroller's annual report
Circulation, redemption of
Circulation, tax on
Circulation, transportation and redemption of
Duties of shareholders' agent relative to
Examinations
Examinations, dissenting shareholders
Examinations, in District of Columbia
Examinations, special
Examiners, fees of
Plates, cost of
Plates and dies, examination of
,
Receiverships, how paid
Receiverships, paid prior to election of shareholders' agent
Sale of bonds
Sale of delinquent stock
F.
Failure. (See Insolvency.)
False entry:
Penalty for, official malfeasance
,
Fees. (See Examiners; Receivers.)
Fine. (See Penalty.)
Firm. (See Liability of association.)
Fiscal agent. (See Agent; Government depositaries.)
Forfeiture. (SeeInterest; Bonds; Charter; Suits.)
Forgery. (See Crimes; Penalty.)
Franchise. (See Corporate powers; Violations of national-bank act.)
Fraudulent notes:
United States and national bank officers to mark
14
31
13
29
128
125
129
118
62
22
126
133
27
15
7
29
31
125
127
126
25
29
29
8
131
16
30
10
4
16
20
17
38
29
31
30
31
29
18
15
36
37
34
7
68
161
127
135
128
133
127
155
160
149
20
178
79
19
101
64
101
77
35
101
35
101
102
91
24
64
36
64
16
9
16
19
9
24
20
G.
Gold:
Certificates not to be issued when reserve of gold coin and bullion is depleted...
Circulation of gold banks redeemable in
Deposit of, for certificates
Gold banks not required to take circulation of other banks at par
Gold banks, issue of circulation by, payable in
Issue of certificates of deposit of
Organization of gold banks
Reserve in Treasury
Reserve of gold banks to be silver and
Taxation of, by State, etc
Gold banks:
Circulation of, issuable
Conversion of
Deposit of bonds by
Exempted from provisions relative to other bank circulation
Organization of
Reserve required for
.*
Tax on circulation
,
Gold bank notes. (See Gold banks; Circulation.)
Gold certificates:
Deposit of gold for
Issue of, prohibited, when
Minimum denomination
Receivable for
56
135
55
127
77
35
102,103
80
101
101
101
101
16
24
19
9
24
9
24
24
22
24
24
24
24
REPORT OF THE COMPTROLLER OP THE CURRENCY.
67
Index to national-ban^ act—Continued.
Paragraph. Page.
Gold reserve in Treasury:
Gold certificates not to be issued when, depleted
Government depositaries:
Deposit and withdrawal of public moneys
Deposits by certain postmasters
Designation and duties of
National bank s as
National-bank circulation to be received by
National banks as financial agents of the Government
Penalty for misapplication of money-order funds
Penalty for unauthorized deposit of public moneys
Penalty for unauthorized receipt or use of public moneys
Secretary of the Treasury to designate
Securities to be deposited by
•
Guardian. (See Trustee.)
101
24
221
222
220
220 .
220
220
223
224
225
220
53
S3
53
53
53
53
54
54
54
53
53
H.
House of Representatives:
Comptroller's reports to be sent to
Hypothecation. {See Pledging.)
12
I.
Imports, interest on public debt:
Circulation of national banks not receivable for duties and interest
Improper use of circulation:
Pledging, hypothecating, etc
ITncurren t circulati on
Incomplete circulation (see also Circulation):
Redemption of
Indian Territory:
National-bank act in effect in
Injunction. (See Comptroller; Suits.)
Insolvency:
Assets, distribution of, by receiver
General j urisdiction of national-bank cases
Impairment of capital
Jurisdiction of courts
Notice to creditors of associations in
Penalty for issuing circulation of associations in
Preference of creditors
Receiver, appointment of
Receiver, duties of
Receiver, when maybe appointed
Redemption of
circulation of association in
Shareholders1 agent
Taxes on bank in, remitted
Interest in national banks prohibited:
By Comptroller
By Deputy Comptroller
Internal Revenue, Commissioner of:
Penalty for failure to make returns to, of taxable circulation
Remission of tax against insolvent State banks
Semiannual return to, of taxable circulation other than national...
J.
Judgment (see also Suits):
Appointment of receiver
Illegal preference of creditors
Jurisdiction. (See Crimes, jurisdiction, etc.)
L.
Larceny. (See Crimes, jurisdiction, etc.)
Lawful money:
Defined
Defined for gold banks
Exemption of circulation from taxation when, deposited
Expiring associations to deposit
Extended banks to deposit
Five per cent fund
Forfeiture of bonds, for failure to redeem circulation in
Liquidating associations to deposit
—
Liquidating association, consolidating, not to deposit
Payment of protested circulation in
Protest of circulation, for failure to redeem in
Receiver to be appointed for failure to maintain reserve of
Redemption account, disposition of
Reserve to be
Withdrawing circulation, deposit of
-
63
15
113
117
26
27
76
19
184
44
154
180
115
179
153
175
162
151
151
151,152
71
160,161
159
36
44
27
44
36
43
39
35
35
35
18
37,38
37
4
4
159
87
21
37
21
152
162
35
39
226
102
85
141
69
66.75
143
138
139
147
142
152
75
94
67,68
55
24
20
33
18
16,19
33
32
32
34
33
35
19
23
17
68
REPORT OF THE COMPTROLLER OF THE CURRENCY,
Index to national-hank act—Continued.
Lawful money reserve:
Balances with agents
Clearing-house certificates
Gold banks
Gold and silver certificates
Five per cent fund
Lawful money on hand
Maintenance of
Receiver for failure to maintain
Eeserve agents, proportion with
United States note certificates
Legal tenders:
Defined
Liability:
bility:
Associ
Association's,
forb pledging,
United States notes, etc .
Converted
State
n k for oldetc.,
Converted bill
Stateagainst
bank
notes
Creditor's
shareholders
C
d
i
t
'
bill
i
t
h
d
Estates owning stock subject to
False certification of checks
Individual, of directors
Limited to amount of capital, except.
Person al, of shareholders
Restriction on
Shareholders' agent
Shareholders, debars from voting
Shareholders exempt from, when
Trustees, exempt from, when
Liabilities:
Associations organized under act of February 25,1863
Change of title or location not to affect
Comptroller's report to contain statement of national banks.
Converted State banks
Deficiency in reserve, not to be increased
Deposit of lawful money relieves from, on circulation
Duties of receiver
Exceptions to limitation
Extended associations
Liquidating associations, on consolidation
Loans, restrictions on
.Reports of condition to show
Restriction on
Shareholders' agent
Lien:
Illegal preference of creditors
Interest on bonds
United States has paramount, on assets of association
Limitations:
Associations, corporate existence
Bonds, withdrawal of
Capital, converted State banks
Capital stock, increase of
Capital stock, reduction of.
Capital stock, payment of
Capital stock, requirements
Circulation, denomination
Circulation, deposit of lawful money on withdrawing
Circulation, increase of, restricted
Circulation exempt from tax
Circulation obtainable
Circulation obtainable by gold banks
Circulation to be taken at par
Circulation, tax on
Circulation, unauthorized, tax on
Comptroller or receiver may be enjoined, when
Corporate existence of converted gold banks
Creditors of insolvent banks, notice to
Creditors of insolvent bank, illegal preference
Directors, number of
Dividends
Expiration of corporate existence
Extended association, deposit of lawful money by
Extension of corporate»existence
Gold certificates, denominations < f
Impairment of capital
Inspection of list of shareholders
Interest rate
Jnrisdicton of courts
Jurisdiction, general, of national-bank cases
Lawful money deposited to retire circulation
Liability of national banks
Location of associations, change of
Loans........ •
Paragraph.
Page.
96,103
23,24
97
102
101
98
94
23
24
24
23
yo
95
94
99
23
no
Zo
23
23
23
226
55
165
89
163
40
21
41
176
157
112
40
112
160,161
30
40
41
47
46
10
89
95
140
151
112
134
139
110
119
112
160
39
11
43
36
26
10
26
37,38
Q
U
10
11
12
11
4
21
23
32
35
26
31
30
26
28
26
37
162
39
83,122
20,28
149
34
6
14,17
10
11
11
16
57,67
37
43
45
19
17
59
67
68
85
49,58
64
77
80,90
flfi
OD
144
36
153
162
27
109,114
141
69
131
101
115
118
107
179
180
68
112
46
110
7
6
15
17
17
20
12,14
16
19
20,21
iii.
91
34
9
36
39
8
26
33
18
30
24
2727
25
44
44
17
26
11
26
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-bank
69
act—Continued.
Paragraph. Page.
Limitations—Contin
ued.
14
National" in title of bank.
Place of business
Public depositaries
Real estate holdings
Reserve, gold banks
Receiver, appointment of.
Receiver, purchase of property to protecit trust.
Reports of condition, transmitted
Reports of earnings and dividends, transmitted
Reserve requirements
,
Reserve with central reserve agents
Reserve with reserve agents
Savings banks in District of Columbia, capital of
Shareholders' agent, duties of
Shareholders, personal liability of
Shareholders, personal liability of certain converted banks
Shares of stock, par value
Shares of stock, directors to own
State taxation of money
State taxation of n ational banks
Stock, purchased or acquired
Suits, conduct of
United States bonds deposited
United States note certificates, denominations of
United States gold certificates, issue of
United States Treasurer to redeem circulation presented, when.
Visitorial powers
Voluntary liquidation, vote
Voluntary liquidation, deposit of lawful money
Voters at elections
Liquidation:
Bonds withdrawn
Creditor's bill against shareholders
Consolidation
Expiring associations to comply with provisions for
General jurisdiction of national-bank cases
Jurisdiction of courts
Lawful money to be deposited
Notice of, to be published
Penalty for issuing circulation of associations in
Redemption of circulation of associations in
Sale of bonds when
Vote required.
Liquidation'and receivership (see also Liquidation;
Receiver):
Bonds, deficiency in, first lien1con assets
' J>for redemption
*
of circulation.
Bonds, forfeiture of....
Bonds, sale of, at auction
Bonds, sale of, privately
Bonds, withdrawal of
Charter, forfeiture of
Circulation, protest of
Consolidation, provisions for
Creditor's bill against shareholders
Deposit of lawful money on liquidating
Directors, individual liability of
Distribution of assets of insolvent associations
Enjoining proceedings
Enjoining proceedings, where brought
Expiring associations
Illegal preference of creditors
Jurisdiction, general, of national-bank cases
Jurisdiction or circuit courts
Notice of vote to liquidate
Notice to creditors of insolvent associations
Notice to present circulation for redemption
Penalty for issuing circulation of expired associations
Receiver, appointment of
Receiver, when may be appointed
Receiver, purchase of property to protect trust
<.
Receivership, expenses of
Shareholders' agent, appointment of
Shareholders' agent, duties of
Suits, conduct of
Suspension of business for nonpayment of circulation
Taxes on insolvent associations remitted
Vote required for liquidation
Loans:
Associations' liability restricted
Circulation as collateral for, prohibited
Prohibited on security of own stock
Real estate, prohibited
Restrictions on
130
93
220
106
102
152
158
119
121
94
. 103
96
123
161
40
40
18
28
91
124
111
183
24
99
99
74
129
136
138
30
30
22
53
25
24
35
36
27
28
23
24
23
28
38
10
10
6
8
22
29
26
44
8
23
23
18
30
32
32
9
140
163
139
141
180
179
138
137
175
70,71
140
136
32
39
32
33
44
44
32
32
43
18
32
32
149
143
148
150
140
156
142
139
163
138
157
154
144
145
141
162
180
179
137
153
147
175
151
152
158
155
160
161
183
146
159
136
34
33
34
34
32
36
33
32
39
32
36
36
34
34
33
39
44
44
32
36
34
43
35
35
37
36
37
38
44
34
37
32
112
113
26
26
26
25
26
HI
106
110
70
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-hank act—Continued.
Paragraph. Page.
Location (see also Title and location):
Organization certificate to state
Losses:
Bad debts and, exceeding profits ..
11
5
114
26
65
16
162
178
158
106
43
36
25
C5
16
M.
Maceration:
Redeemed circulation to be disposed of by
Maximum. (SeeBonds; Capital; Circulation; Limitations.)
Minimum. (SeeBonds; Capital; Circulation; Limitations.)
Misdemeanor. (See Crimes; Penalty; Official malfeasance.)
Moneys. (See Lawful money; Legal tender; Circulation; Public moneys.)
Mortgages:
Assignment of, when illegal
Official malfeasance
Purchase oi\ hy receiver
Real estate, possession, etc., of, by association
Mutilated or worn circulation:
Redemption of
X.
National:
Use of the word, in titles of associations other than national, prohibited
130
National-bank act:
Provides for a national currency, etc
1
Status of national banks organized under act of February 25, 1863
47
National banking associations:
Amendment of articles of association restricted
42
Articles of association entered into by
13
Branches may be retained by converted State banks
39
Capital required
17
Capital of converted State banks
38
Cancellation of redeemed circulation
73
Certificate of officers and directors
23
58
Circulation obtainable by
80-87
Circulation of, tax on
74
Circulation of, to be redeemed in United States notes
77
Circulation to be taken at par
G3
Circulation of, for what receivable
76
Circulation unsigned or with forged signatures to be reduced
71
Closed bank circulation
•
46
Ch ange of title and location
156
Charter forfeiture
i
60
Charter number to be printed on circulation of
|
6
Comptroller and Deputy Comptroller not to be interested in, issuing circulation.. j
Conversion of State banks to
!
37
Corporate and incidental powers of
16
Crimes, jurisdiction, etc
164-183
Deposit of bonds by
24
Directors individually liable when
157
Directors, number and election of
27
Directors, oath of
31
Directors, qualification of
28
Election, holding annual
32
Enjoining proceedings
144
Examination of, prior to being authorized to begin business...
25
Expiration of corporate existence, provisions on
141
Extended bank circulation
69
51
Exchange of bonds
132,133
Extension of corporate existence of
General provisions respecting bonds
57
Gold bank circulation, provisions for issuing
64
35
Gold banks may be organized
36
Gold banks, conversion of
76
Incomplete circulation of
Increase of capital stock by
43,44
Liquidating bank circulation
70
136,140
Liquidation, provisions for
1
76
Lost or stolen notes of, to be redeemed
184
National-bank act relative to, in force in the Indian Territory
29
Oklahoma, qualification of directors in
14
Organization certificate to specifically state.
19
Payment of stock prior to beginning business
78
Post-notes, issue of, prohibited
59
Preparation of bank circulation
26
Publication of certificate of authority
34
President of, to be chosen by board
21
Receiver may be appointed for failure to restore capital.
45
Reduction of capital stock
152
Receiver for, when may be appointed
30
3
12
11
5
10
6
10
18
7
14
20,21
18
19
15
19
18
11
36
15
4
10
Q
40,44
8
36
8
9
8
9
34
8
33
18
13
31
14
16
9
9
19
11
18
32
19
44
8
5
7
19
15
8
9
7
11
35
71
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-hank
act—Continued.
Paragraph.
National banking associations—Continued.
Redemption and destruction of circulation of
Redemption account, disposition of
Regulation of business of
,
Relation of bond deposit to capital of
Security for circulation
Shares of stock
Shareholders of, qualifications of, at elections
Shareholders' agent
Shareholders of, personally liable
Shareholders of, when not personally liable
Status of, organized under act of February 25,1863
Subscribed stock not paid for, forfeited to
Suspension of business after default to pay circulation.
Taxation of circulation of, by States, etc
Tax provision s restricted
Taxes on in solvent, remitted
Where proceedings to enjoin may be brought
Withdrawing circulation
New York City:
Associations in, reserve agents
Bonds, sale of forfeited, in
Notice of expiration of corporate existence in paper in.
Notice of voluntary liquidation in paper in
Net profits. (See Dividends.)
Nonresidents:
Directors
State, etc., taxation of stock of
Notary public:
Acknowledgment of organization certificates before
Acknowledgment of reports
Notice.
(See Publication; Printing.)
Page.
65,66
75
92-130
50
49
18
30
160
40
40
47
20
146
91
90
159
145
67,68
16
19
22,30
13
12
94,96,
103
148
141
137
23
24
34
33
32
28,29
124
29
15
119,120,
121
37
10
10
12
7
34
22
21
37
34
17
6
O.
Oath:
Certificate of officers and directors
Directors
Examiners may take statements under
Execution of organization certificate
Official, by Comptroller
Official, by Deputy Comptroller
Payment of installm ents
Reports of condition, etc
Semiannual return of circulation
Shareholders, list of
Obligations of the United States:
Defined
Penalty for dealing in counterfeit
Penalty for illegal possession or use of material for
Penalty for passing counterfeit
Penalty for pledgin g
Penalty for taking or having unauthorized impressions of tools, etc
Officers (see also President; Casnier):
Bonds assigned to be signed by cashier or other
Certificate of directors and
Certificate of payment of increase of stock
Certification of payment of stock by president or cashier
Circulation properly signed, issuable
Disqualified to examine national banking associations in which interested as
Election or appointment of, by directors
Examination of, under oath
False certification of checks forbidden
Forfeiture of charter, provisions for
Forged signatures of, to circulation not to invalidate
Fraudulent notes to be marked by
Oath, administration of, to reports
Official malfeasance, penalty for
Penalty for false certification of checks
Penalty for improper countersigned, etc., circulation
Penalty for issuing circulation of expired associations
Penalty for official malfeasance
Penalty for pledging, etc., circulation
Penalty for unauthorized receipt of public money
Preference of creditors
President of board a director
President or cashier, certification of extension
President or cashier, certification of expiration of existence
President or cashier, certification of liquidation
19,23
31
7
9
125
29
15,37
6,10
4
5
123
3
3
7
28
28
81-87
20,21
19
119-121,
118
27
169
174
170
171
165
41
42
41
42
40
42
172,173
52
23
44
19
63
126
16
125
176
156
76
79
120
178
177
164
175
178
165
225
162
34
132
141
137
13
7
12
7
15
29
(5
29
43
36
19
19
28
43
43
40
43
43
40
54
39
9
31
33
32
72
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-bank act—Continued.
Page.
Officers (see also President; Cashier)—Continued.
President or cashier waiving notice of protest
President or vice-president and cashier to sign circulation
Proxy, not to act as
Kecei ver, appointment of, for violation of national-bank act by
Redemption of unsigned circulation
Reports of condition, verification of, by president or cashier
Reports of earnings and dividends, attestation of, by president or cashier.
Shareholders' list, verified by president or cashier
Taxation, circulation subject to, returns by president or cashier
Taxation unauthorized circulation, returns by president or cashier
Officers, United States:
Deposit and withdrawal of public money
Penalty for improper countersigning or delivering circulation..
Penalty for unauthorized deposit of public money
Receiving or disbursing public money to mark fraudulent
Offices, vaults, etc.:
Assignment of, to the Comptroller by the Secretary
Oklahoma:
Qualification of directors of association in
Organization and powers of national banks:
Amendment of articles of association
Articles of association
Branches of converted State banks
Capitalstock
Capital stock requirements
Certificate of authority to begin business
Certificate of officers and directors
Change in title and location
Conversion of gold banks
Conversion of State banks
Corporate powers
Deposit of oonds
Directors, election of
Directors, number and election of
Directors, oath of
Directors, qualificati on of
Directors, qualification of, in Oklahoma
Directors, to choose president
Directors, vacancy, how filled
Enforcing payment of stock
Examination preliminary to beginning business
Execution of organization certificate
Extension of corporate existence
Failure to hold election
Gold banks, conversion of
Gold banks, organization of
Incidental powers
Increase of capital stock, provisions for
Increase of capital stock, when valid
Liquidation
Location and title, change of
Location
Organization certificate
Payment of stock
President, election of, by board
President, qualification of
Publication of certificate of authority to begin business
Reduction of capital stock, provision's for
Restoration of capitalstock
Shareholders
Shareholders, personal liability of
Shareholders, qualification of, at election
Shareholders, when personally liable
Shares of stock
State banks, capital of converted
State banks, conversion of
State banks, conversion of, and capital
State banks, converted may retain branches
Status of associations organized under act of February 25,1863
Title
7
Title and location, change of
Vacancies in board, how filled
Organization certificate:
Certified copy of, evidence
Comptroller to grant or withhold
Conversion of gold banks
Conversion of State banks
Execution of
Sealed certificate of Comptroller, evidence
Specifications in
142
59
30
152
76
119
121
118
81
87
33
15
9
35
19
28
28
27
20
21
221
164
224
79
53
40
54
19
29
42
13
39
14
17
25
23
46
36
37
16
24
32
28
29
34
33
20
22
15
131
32
36
35
16
43
44
136
46
14
14
19
34
34
26
45
21
14
40
30
40
18
38
37
38
39
47
14
11
5
10
5
6
8
7
11
9
10
6
8
9
8
9
8
8
9
9
7
7
6
30
9
9
9
6
11
11
32
11
5
5
7
9
9
8
11
7
5
10
9
10
6
10
10
JO
10
12
5
46
33
11
9
182
25
36
37
15
181
44
8
9
10
6
44
5
27
31
14
73
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-bank act—Continued.
Page.
P.
Payment of capital stock:
Provisions relative to
Penalty:
Appointment of receiver for violations of act
Bon d of Comptroller
Bond of Deputy Comptroller
Counterfeiting circulation
Dealing in counterfeit circulation
False certification of checks
Failure to pay installment on stock
Failure to redeem circulation
Forfeiture of charter
Illegal possession or use of material for circulation
Imitating bank circulation for advertising purposes
Improper countersigning or delivering circulation
Interest, unlawful
Issuing circulation of expired associations
Jurisdiction of United States courts
Mutilating circulation
Misapplication of mouey-order funds
** National," unlawful use of the word
Official malfeasance
Passing counterfeit circulation
Pledging United States notes or bank circulation
Heports to Comptroller, failure to make
Reserve, maintenance of
Semiannual return of circulation
Taking or having unauthorized impressions or tools, etc
Unauthorized deposit of .public money
Unauthorized receipt or use of public money
Personal liability. (See Shareholders; Trustee; Liability.)
Plates:
Control of
Cost of engraving
Custody of
Engraving of
Examination annually
Expense of examination and destruction of
Extended banks
Liquidating bank, to bo destroyed
Penalty for counterfeiting, or having possession of counterfeit
Penalty for taking unauthorized impressions of tools, etc
Penalty for ha ving false impressions of tools, etc
Pledging or hypothecating circulation:
Prohibited
Population:
Relation of capital stock to
Postmasters:
Deposit of public funds by
Misapplication of money-order funds by
Postmaster-General:
Deposit of funds by authority of
Post-notes:
National banking associations prohibited from issuing
Powers (see also Comptroller):
Granted to national banks
Incidental, of national banks
,
Visitorial, limitation of
Preparation of circulation:
Provisionsfor
President (see also Officers):
Certificate of officers and directors
Countersigning or delivering circulation improperly
Director to be
Election or appointment of, by directors
False certification of checks and penalty for
Official malfeasance, penalty for
Proxy, not to act as
Public money, unauthorized receipt of, by
Signature ofj forged, not to invalidate circulation
Signature of, on circulation
Violations of act by, penalty for
President of the United States:
Appointment of Comptroller by
Printing (see also Publication):
Annual report of the Comptroller, number printed and distribution of.
Certificate of authority to begin business
Charter numbers on circulation
19
151,152
4
5
168
174
177
20
143
156
170
166
164
108
175
180
167
223
130
178
171
165
122,123
95
81, 82,83,
86,88
172,173
224
225
35
3
3
41
42
43
7
33
36
41
40
40
25
43
44
41
54
30
43
42
40
28
23
20
21
42
54
54
170,172,
173
172
173
15
16,18
4
15
15
15
18
15
41,42
42
42
42
113
26
61
66,69
17
6
222
223
53
54
223
54
78
19
16
16
129
59
6
30
15
23
164
34
16
176,177
178
30
225
76
59,63
152,156
7
40
9
6
43
43
9
54
19
15
35,36
3
3
12
26
5
8
15
74
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-hank act—Continued.
Page.
Printing (see also Publication)—Continued.
Circulation of associations
Circulation of extended banks
Creditors of insolvent associations, notice to
Notice of special annual election
Notice of sale of delinquent stock
Notice Of sale of bonds at public auction
Notice of liquidation
Notice of expiration
Penalty for counterfeiting circulation
Penalty for illegal possession or use of material for circulation.
Penalty for imitating circulation.
Penalty for taking or having unauthorized impressions of tools, etc., for...
Provisions for, Comptroller's annual report
.Reports of condition.
Shareholders' agent, notice of election of
Voluntary liquidation, notice of
Protest of circulation:
Bonds forfeited, when
Bonds, sale of, when
Failure to redeem circulation
Publication (see also Printing):
Annual election, notice of holding special
Certificate of authority to begin business
1
Change of title or location, notice of
Creditors of insolvent associations, notice to
Expiration of corporate existence, notice of
Nonpayment of circulation, notice to present
Reports of condition of banks other than national in District of Columbia.
Reports of condition of national banks
Sale of bonds, notice of
Sale of delinquent stock, notice of
•
Shareholders* agent, notice of election of
Voluntary liquidation, notice of
Public debt. (See Imports and interest on public debt.)
Q.
Qualification:
Comptroller of the Currency
Deputy Comptroller
Directors of national banks
Directors of national banks in Oklahoma.
Examiners of associations
Receivers of associations
Shareholders' agent
59
C9
153
32
20,116
148
137
141
168
170
166
172,173
11
119,123
160
137
15
18
36
9
7,27
34
32
33
41
41
40
42
5
28
37
32
143
148,150
142
34
147
123
119
148
20,116
160
137
9
8
11
36
33
34
28
28
34
7,27
37
32
4
5
28
29
126
151,152
160
3
3
8
8
29
35
37
106
124
25
29
151
152
21
152
151
152
152
152
144
155
180
179
158
35
35
32
26
46
153
Ml
R.
Rate. (See Interest; Taxation.)
Ratio. (SeeBonds; Capital; Circulation.)
Real estate:
Investments and holdings restricted
Subject to State, etc., taxation
Receiver:
Appointment and duties of
Appointment of, for failure to dispose of own stock
Appointment of, for failure to restore diminished capital—
Appointment of, for false certification of checks
Appointment of, for nonpayment of circulation
Appointment of, for impairment of capital
Appointment of, for insolvency
Appointment of, for nonmaintenance of reserve
Courts may enjoin
Expenses of, how paid
,
General jurisdiction of national-bank cases
Jurisdiction of circuit courts
Purchase of property by, to protect trust
Receiverships. (See Liquidation and receivership; Receiver.)
Redemption:
Cancellation of circulation sent for
Deposit of lawful money for, of associations in liquidation..
Disposition of, account
Enjoining Comptroller
Extended bank circulation
First lien on assets
,
Five per cent fund for, to be maintained
Five per cent fund for, part of lawful reserve
,
Forfeiture of bonds
Forged signatures n ot to prevent
General provisions respecting
Incomplete circulation
Liquidating bank circulation
73
7
35
35
35
35
35
34
36
44
44
36
138
75
144
69
149
18
32
19
34
18
34
66
16
QQ
»O
143
76
66
76
70,71
90
33
19
16
19
18
REPORT OF THE COMPTROLLER OF THE CURRENCY.
75
Index to national-bank act—Continued.
Paragraph.
Redemption—Continued.
Notice to present circulation for
Proceeds from sale of bonds for, of circulation
Profit on circulation not presented for
Protest of circulation, for failure to redeem
Provisions for, of circulation
Provisions for, of United States note certificates
Records of
Sale of bonds
State bank circulation, converted, provisions for.
United States notes, of circulation in
Unsigned circulation to be redeemed
Withdrawn circulation
Worn or mutilated circulation
Redemption account:
Disposition of
Register of the Treasury:
Signature on circulation
Registered bonds. {See Bonds, United States.)
Regulation of banking business:
Assessment, enforcement of
,
Circulation, improper use of
Dividends
Dividends prohibited, when
Examiners, appointment of
Examiners, compensation of
Impairment of capital
Interest, limited
Interest, unlawful, penalty for
Laws governing certain associations
Liability of association restricted
Loans, restrictions on
Net profits
Place of business
Real estate, purchasing, etc
Reports of condition
Reports, failure to make
Reports, verification of
Reports of dividends and earnings
Reports, verification of
Reserve cities
Reserve cities, balances with agents
Reserve cities, central
Reserve cities, requirements
Reserve cities, requirements, gold banks
Shareholders, list of
State taxation of associations
Stock, holding, etc
Surplus and dividends
Uncnrrent notes, use of, prohibited
Unearned dividends prohibited
Visitorial powers, limitation of
Reimbursement. (See Circulation; Expenses; Plates and dies.)
Reports:
Amendments proposed in Comptroller's
Annual, to be made to Congress
Banks, other tha n national
Circulation, semiannual return of
Closed banks
Condition of banks other than national
Condition of national banks in
Distribution of
Dividends and earnings
List of shareholders
Payment of capital stock
Printed, when
Printed, number of copies
Statement of condition of national banks
Reserve:
Clearing-house certificates
Five per cent fand
Gold and silver, held by gold banks
Gold certificates
Lawful money
Maintenance of
Penalty for failure to maintain
Proportion of, with agents
Requirements
Requirements for gold banks
Reserve agents, balance with
Silver certificates
United States note certificates..
147
140
69
142
65
100
72
Page.
34
65
32
18
33
16
24
18
34
21
18
19
17
16
75
19
59
15
148,150
89
74
76
67,68
116
113
109
114
125
127
115
107
108
92
112
110
109
93
106
119
122
120
121
121
27
26
26
26
29
29
27
25
25
22
26
26
26
22
25
28
28
28
28
28
94,104 23,24
96
23
103,105 24,25
94
23
102
24
118
27
124
29
111
26
109
26
117
27
114
26
129
30
10
10
123
81
10
10
10
12
121,122
118
19
11
12
119,120
4
4
28
20
4
4
4
5
28
27
7
5
5
28
23
19,23
24
24
23
23
23
96,103 23,24
94
23
102
24
96,103 23,24
101
24
99
23
97
75,98
102
101
94
95
95
76
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-hank act—Continued.
Paragraph. Page.
Reserve agents (see also Agents):
Balance with
,
Central
Central, additional
Cities, additional, in which may be located
Cities in which located
Reserve cities:
Additional, provisions for
Central, deposits in
Central, provisions ibr
Named
Requirements, not applicable to gold banks in San Francisco.
Requirements of associations in
Residence:
List of shareholders and reported annually
List of shareholders in organization certificate
National banks
Qualification of directors of associations
Resources. (See Assets.)
Restoration of capital stock:
Provisions for
Returns. (See Circulation; Reports; Taxation.)
Revised Statutes, United States:
Sections of this act, etc., index of
24
25
24
23
24
24
25
23
24
27
5
44
8
44
7,27
83
S.
Sale:
Assets of insolvent associations by receiver
Assets of insolvent associations by shareholders' agent.
Bonds for failure to redeem circulation
Stock for delinquent payment of installment
Stock on impairment of capital
Stock taken for debt
Savings banks:
Limit of capital of existing, in the District of Columbia
Reports of, provided for in annual report
Trust companies and, in the District of Columbia
Seal of office of Comptroller:
Certified copy of organization certificate under, evidence
Certificates under, competent evidence
Description, impression of, and certificate of approval by Secretary of the Treasury, to be filed with the Secretary of State
Devised by the Comptroller and approved by Secretary
Secretary of State:
Description, impression, and certificate of seal of Comptroller to befiledwith
Secretary of Treasury:
Agent, special, to be appointed for associations failing to redeem circulation
Appointment of Comptroller on recommendation of
Appoin tment and classification of clerks by
.Appointment of Deputy Comptroller by
Assignment of rooms, etc., for the Comptroller by
Authorized to exchange registered for coupon bonds
Circulation, worn or mutilated, destruction of, by
Currency, expansion or contraction of, by issue of currency certificates, prohibited by
Duties of Comptroller under general direction of
Exchange of bonds, terms of, prescribed by
Organization of national banks with capital less than $100,000 to be approved by.
Plates and dies, examination of, by
Recommendation of appointment of Comptroller by
Receivers, appointment of, by Comptroller, concurrence in by, in certain cases...
Reserve cities, designation of, by Comptroller, to be approved by
Seal of office of Comptroller to be approved by
United States certificates may be issued by
Security for circulation. (See Bonds, United States.)
Security for loans:
Personal
Senate:
Comptroller's reports to be sent to.
Shareholders:
Agent of, to return to, assets of insolvent association
Appointment and qualification of agent of
Assessment for impairment of capital
Assets of insolvent association to be returned to, ratably.
Consent of, necessary to extension
,
Conversion of State banks, requirements
Creditor's bill against
Directors, election or appointment of, hy
Dissenting to extension may withdraw
151
161
35
38
140,143,
148,150
32,33
20
116
111
34
7
27
26
123
10
123
28
4
28
182
181
44
44
8
8
4
4
8
4
143
3
7
5
9
51
65
33
3
4
3
4
13
16
100
2
57
17
62
3
95
105
8
99
24
3
14
6
15
3
23
25
4
23
161
160
115
154
132
37
163
38
37
27
36
31
10
39
6,8
31
16,27
135
77
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-bank act—Continued.
Page.
Shareholders—Continued.
Duties of agent of
Election by, annually
Election or appointment of directors by
Enforcement of assessment for impairment of capital stock
Enforcing payment by, of installments
Estates and funds with trustee liable for assessment
Extension of corporate existence
•
Increase of capital stock by
List of, to be kept and copy sent to Comptroller
List of, subject to inspection
Location, change of, by
Names, residences, and number of shares held by each in organization certificates
Personal liability of
Personal liability of, in certain converted State banks
Provisions for election by, when
Proxies, votingby
Qualifications of directors
Reduction of capital stock by
Rights and liabilities of, on transfer of shares
Title and location of association, change of, by
Vote of, necessary to place association in liquidation
Voting
Voting not allowed, when
Shareholders' agent. (See Agent.)
Shares:
Association not to own or hold its own except
Consent of owners of two-thirds, necessary to extension
Converted State bank to bo the same as prior to conversion
Disposition of, taken for debt
Fifty per cent of aggregate value of, to be paid in prior to beginning business..
Holding of, in other banks, by converted banks authorized
Installments, payment and certification of
List of owners of, to be kept and copy sent to Comptroller
Loan on security of, prohibited
Oath of director relative to
Owners of two-thirds, may place association in liquidation
Organization certificate to state capital and number of
Personal property
Preference in allotment of, in succeeding association
Qualification s of directors
Receiver may be appointed for failure to dispose of, taken
Sale or forfeiture of, for failure to pay installments due
Sale of, when necessary
State taxation of
Transfer of
Value of, of shareholders dissenting to extension, how ascertained
Val ue, par, of each
Voting
Signature on circulation:
President or vice-president and cashier
Treasurer and Register, United States
Silver:
Construed to be lawful money, when
Reserve of gold banks to be gold and
Silver certificates:
Clearing-house balances payable in
Reserve of national banks may be
Solicitor of the Treasury:
Conduct of suits under direction and supervision of
Special agent. (See Agent.)
Special reports. (See Reports.)
State banks:
Branches of converted
Capital of
Conversion of
Penalty for failure to make return of tax on circulation
Penalty for unauthorized receipt of public money
Reports of, provided for
Return of taxable circulation
Shareholders' personal liability, exceptions
Shares of converted
Tax on converted
Tax on unauthorized circulation
State courts. (See Comptroller; Suits.)
State, Territory, or District:
Change of title or location of associations
Compensation of national-bank examiners
Conversion of bank organized under authority of laws of
Evidence
161
27,32
16,27
116
20
41
131
43
118
118
46
14
40
40
32
30
28,29
45
18
46
136
30
30
111
132
37
111
19
37
19
118
111
31
136
14
18
135
38
8,9
6,8
27
7
11
30
11
27
27
11
5
10
10
9
9
8
11
6
11
32
9
9
152
20
26
31
10
26
7
10
7
27
26
9
32
5
6
31
8
35
7
20,111,
116,135
7,26
27,31
124
18
135
29
6
31
18,37
6,10
28,29
30
9
59
59
15
15
102,226
24,55
102
24
101
101
24
24
183
44
39
38
37
88
225
10
87
40
37,38
89
86
10
10
10
21
54
4
21
10
10
21
21
46
127
27
181,182
11
29
8
44
78
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Index to national-hank act—Continued.
Page.
State, Territory, or District—Continued.
Examinations in District of Columbia.
128
Interest, legal rate in, national banks not to take, etc., in excess of
107
"National," use of the word in titles
130
Qualification of directors
28
Proceedings to enjoin Comptroller or receiver, to bo brought in district in which
association is located
145
Taxation of circulation of State, etc., associations
86-89
Taxation of money by
91
Taxation of national banks by
124
Succession:
Expired associations
135
Period of, national banks
16
Suits:
Against United States officers or agents
183
Certified copy of organization certificate evidence in
182
Circuit courts, jurisdiction of
179
Corporate powers of associations
16
Creditor's bill against shareholders
163
Crimes, jurisdiction, etc
164-184
District courts, j urisdiction of
180
Enjoining Comptroller or receiver
144
Forfeiture of charter
156
Illegal preference of creditors
162
Indian Territory, in
184
Jurisdiction of circuit courts
179
Jurisdiction, general, of national-bank cases
180
Proceedings to enjoin Comptroller to be brought, where
145
Sealed certificate of Comptroller, competent evidence
181
Shareholders'agent
161
Shareholders' liability, to enforce
151
Solicitor of the Treasury to direct and supervise certain
183
Surplus (see also Surplus and dividends):
Converted State bank with capital of $5,000,000
40
Creation of
109
Receiver may be appointed for deficiency
40
Surplus and dividends:
Provisions for surplus and payment of dividends
109
Surrender of Bonds. (See Bonds, United States.)
T.
Tax:
Bills of converted State bank.
Circulation, enforcing payment of.
Circulation, exempt from
Circulation, failure to make returns
Circulation, rate and time of payment
Circulation, refunding excess
Circulation, semiannual return of
Money of all kinds subject to, by States, etc
Notes unauthorized
Notes unauthorized, failure to make return
87
Notes unauthorized, semiannual return
90,91
Provisi ons restricted
159
Remission of, on insolvent national banks
124
State taxation of national banks
Taxation. (See Tax.)
Teller. (See Officers.)
Territorial court. (See Comptroller; Redemption; State, etc.)
Title and location:
Change of, by national banks
46
Transfers. (See Treasurer United States; Bonds, United States.)
Treasurer,United States:
67
Circulation, withdrawal of, provisions for
24,49
Deposit of United States bonds with, to secure circulation
75
Disposition of redemption account
83
Enforcing tax on circulation
Examination of bonds and records, provisions for
55-57
Interest on bonds to be retained by, when
83,115,
Public moneys to be deposited with assistant treasurer, Government depositaries, or
Proceedings on default in making return on circulation subject to duty
Redemption fund to be kept with
Redemption of circulation by
Redemption of circulation in United States notes by
Semiannual return to, of circulation subject to duty
Signature of, on circulation
Tax, excess, refunding
Tax on circulation to be paid to
Transfer of bonds in trust for associations to be made to
122
221
82
30
25
30
8
34
21
22
29
31
6
44
44
44
6
39
40,44
44
34
36
39
44
44
44
34
44
38
35
44
10
26
10
26
21
20
20
20
20
20
20
22
21
21
21
21, 22
37
29
11
17
8,12
19
20
13,14
20,27
28
53
20
16
16
18
20
15
20
20
13
REPORT OF THE COMPTROLLER OF THE CURRENCY.
79
Index to national-bank act—Continued.
Paragraph. Page.
Treasury, United States (see also Treasurer, United States):
Associations to reimburse, for cost of redemption of circulation and plates.
Currency bureau in
Notice to present circulation at
Penalty for failure of associations to report to be paid into
Redemption account, disposition of
Redemption fund, 5 per cent, in
,
Redemption of circulation at
Trust:
Purchase of property by receiver to protect..
Trustee:
Shareholders' liability, exemptions from
,
2
147
81,122
75
66
67,71,
72,73
16
3
34
20,28
19
16
17,18
18
158
36
41
11
117
27
144
156
34
36
79
224
221
19
54
53
74
79
99
169
174
170
171
165
172,173
100
91
18
19
23
41
42
41
42
40
42
24
22
107
108
25
25
U.
Uncurrent notes:
Issue of, prohibited
•
United States (see also Officers of the United States; Crimes,,jurisdiction, etc.):
Courts of, may enjoin proceedings
Forfeiture of charter
United States disbursing officers:
Fraudulent notes to be marked by
Penalty for unauthorized d eposit of public money
Withdrawal of public money
United States notes:
Circulation of banks to be redeemed in
Fraudulent, to be marked
Issue of note certificates on deposit of
Obligations of the United States defined
Penalty for dealing in counterfeit
Penalty for illegal use or possession of material for printing
Penalty for passing counterfeit
Penalty for pledging, etc
Penalty for taking or having unauthorized impressions of tools, etc
Redemption of certificates issued for
Subject to taxation by States, etc
,
Usury:
Interest, when not
Penalty for
Vacancies:
Board of directors, filling
Vice-president (see also Officers):
Bonds, United States, may sign transfer of
Circulation, may sign
Election or appointment of
Proxy, not to act as
Violations of provisions of national-bank act:
Forfeiture of charter for
Visitorial powers:
Limitation of national banking associations, subject to .
Voluntary liquidation. (See Liquidation.)
Voters:
Qualifications of shareholders at elections
Withdrawal:
Bonds, general provisions respecting.
Circulation, provisions for
Deposit and, of public moneys
Dissenting shareholders
Expired associations, bonds of
Illegal preference of creditors
Liquidation associations, bonds of
Reduction of capital
Unearned dividends
33 I
52
59,63
16
13
15
6
9
156
36
129
30
30
57
67,68
221,224
135
141
162
140
45
114
14
17
53,54
31
33
39
32
11
26
INDEX TO ACT FOR INCORPORATION OF TRUST COMPANIES, ETC.
TRUST COMPANIES, ETC., IN THE DISTRICT OF COLUMBIA.
Paragraph.
A.
Amendment of act incorporating:
Provisions for
Annual report:
Liability for failure to make
Liability for failure to report for taxation
Required to be made to the Comptroller
Assets and capital:
Security when corporation is trustee, etc
B.
Bonds:
Debenture, issuance of
Deposit of other securities and, to secure debenture
Deposit of other securities and, with the Comptroller
District supreme court may require
Not required of trust companies, when
By-laws:
Directors or trustees to make
C.
Capital stock:
Enforcement of subscriptions to
Increase of
Liability of shareholders
Money payment of, required
Provisions relative to
Transfer of shares of
Trustee, etc., not liable on stock assessments
Charter:
Amendment, provisions for
Application for, notice of intention
Comptroller to certify to payment of .stock, etc
Copy of, etc., to befiledwith Comptroller
District Commissioners to issue
Recorder of deeds, to be filed with
Comptroller of the Currency:
Annual reports to
Certificate of payment of capital stock and deposit of securities to be issued by.
Copy of organization certificate and charter to be filed with
Deposit of securities with
Existing corporations to file with, intention to organize under this act
Insolvency, corporation to be taken possession of, by
Trust companies under supervision of
Value of assets of existing corporations.organizing under this act, to be ascerValue of securities deposited for debenture bonds to be determined by
Corporate existence:
Limitation of, to be stated in organization certificate
Period of
Creditors:
Preferred
Stockholders1 liability
D.
Directors:
Appointment of officer by.....
By-laws, adoption of, by
Enforcement of subscriptions to stock by
Li ability of, for failure to report
Liability of, when may be avoided
Liable tor payment of unearned dividends
Majority of, to sign annual report
Number and election of.
Number of, to be stated in organization certificate
Qualifications of
Responsibility of, for excess liabilities
80
219
52
202
200
49
49
49
216
51
191
191
198
217
216
46
46
48
52
51
209
51
199
214
205
206
198
204
213
49
51
50
50
48
50
51
219
188
189
189
187
189
52
46
46
46
46
46
200
189
189
198
195
190
190
49
46
46
48
48
46
46
206
191
50
46
186
197
45
48
216
205
51
50
208
209
199
202
211
210
200
207
186
207
212
50
51
49
49
51
51
49
50
45
50
51
REPORT OF THE COMPTROLLER OF THE CURRENCY.
81
Index to act for incorporation of trust companies, etc,—Continued.
Paragraph. Page.
District Commissioners:
Charter to be obtained from
District supreme court:
Jurisdiction of trust companies
Dividends:
Declaration of, by directors
Directors' liability for, how avoided
Directors liable for payment of unearned
187
46
217
52
210
211
210
51
51
51
E.
Election:
Directors, number an d
Evidence:
Certified copy of incorporation certificate competent
207
50
215
51
201
201
49
49
I.
Insolvency:
Comptroller to administer affairs of corporation in
Preferred claims in case of
190
216
46
51
J.
Jurisdiction. (See District supreme court.)
L.
Liability:
Corporations, as trustee
..........................
Debenture bonds, issue of
Directors, for payment of unearned dividends
Directors', may be .avoided
Directors', for excess
Failure to make reports
Stockholders'
Stockholders and officers', for performance of trust
Subscriptions to stock
Trustee, etc., on stock assessment
.........
191
191
210
211
212
202
205
194
199
213
46
46
51
51
51
49
50
48
49
51
188
46
200,201
208
203
49
50
50
195
185
48
45
186
187
186
45
46
45
190
210,212
218
199
202
203
46
51
52
49
49
50
203
203
50
50
191
191
46
46
216
51
200
208
49
50
195
48
185
185
45
45
Gross earnings:
Liability for failure to report
Tax on
G.
Notice:
Intention to apply for a charter to bo published, etc
O.
Officers:
Annual report to be signed by certain
Appointment of
Perjury and larceny, penalty for
Organization:
Existing corporations
Provisions for
Organization certificate:
Execution of
Presented to Commissioners
Specifications in
P.
Penalty:
Corporations subject to the same, as provided for national banks
Directors'liability
Failure to comply with the provisions of this act
Failure to pay subscriptions to stock
Failure to pay t a x e s
,
Perjury and larcency
Perjury and larceny:
Defined
Penalty for
Powers:
General
<
Special
Preference:
Debts due as trustee, etc-, shall have
President:
Annual report to be signed and verified by
Directors to choose
Privileges:
Extended to existing corporations, when
Purposes of corporations:
Safe deposit, trust, loan, and mortgage business
Security, guarantee, indemnity, loan and mortgage business
H. Doe. 10
6
82
REPORT OP THE COMPTROLLER OF THE CURRENCY.
Index to act for incorporation of trust companies, etc.—Continued.
Paragraph.
Page.
Purposes of corporations—Continued.
Storage business
Title insurance, loan, and mortgage business .
185
185
45
45
Qualifications:
Directors..
Officers
Trustees...
207
208
193
50
50
48
R.
Real estate:
Purchase, holding, etc., of, by corporations .
Recorder of deeds:
Charter of corporation to be filed with
196
48
189
46
200
50
49
210,212
211
199
205
199
207
213
204
51
51
49
50
49
50
51
50
218
52
205
50
199
49
201
49
186
45
208
50
194
48
192
193
194
47
48
48
S.
Secretary:
Appointment of
Verification of reports by
Securities. (See Bonds.)
Shares:
Directors' liability
Directors' liability, when may be avoided
Enforcement of subscriptions to
Liability of stockholders
Par value of
Qualifications of directors
Trustees, etc., not liable on assessment
Transfer of
Similar district corporations:
Subj ect to this act
Stock. (See Capital stock.)
Stockholders:
Liability of
Subscriptions to stock:
Provisions for enforcement of
Supervision. (See Comptroller of the Currency.)
T.
Tax:
On gross earnings
Title:
Organization certificate to contain
Transfer of stock. (See Capital stock.)
Treasurer:
At>pointment of
Trust:
Security for the faithful performance of
Trustee, etc.:
Corporations competent to act as
Qualifications of corporations as
Security for performance of trust
U.
Unearned, dividends. (See Dividends.)
Visitorial powers:
Limitation of. -.
V.
190
INDEX TO SECTIONS OF REVISED STATUTES.
Section.
324.
325.
326.
327.
328.
329.
330.
331.
332.
333.
380.
629.
736.
884.
885.
3410.
3411.
3414.
3415
3416.
3417
3585.
3586.
3587.
3588
3589
3590
3620
3701
3811
3847
4046
5133
5134
5135
5136
5137
Paragraph.
2
3
4
5
7
6
8
9
128
10
183
179
145
181
182
38
85
87
88
226
226
226
226
226
226
221
91
11
222
223
13
14
15
16
106
Section.
5138.
5139.
5140.
5141.
5142.
5143.
5144.
5145.
5146.
5147.
5148.
5149.
5150.
5151.
5152.
5153.
5154.
5155.
5156.
5157.
5158.
5159.
5160.
5161.
5162.
5163.
5164.
5165.
5166.
5167.
5168.
5160
5170
5172.
5173
5174
Paragraph.
17
18,42
19
20,21
43,44
45
30
27
28
31
33
32
34
40
41
220
37
39
47
92
48
24,49
50
51
52
53
54
55
56
57
22,23
25
26
59
61
62
Section.
5182
5183
5184
5185
5186
5187
5188
5189
5190
5191
5192
5193
5194
5195
5196
5197
5198
5199
52uO
5201
5202
5203
5204
5205
5206
5207
5208
5209
5210
5211
5212
5213
5214
5215
5216
5217
Paragraph.
78
65
35,64
102
164
166
167
93
94,95
96
99
100
103
77
107
108
109
110
111
112
113
114
115
117
165
176
178
118
119
121
122
80
81
82
Section.
5218
5219
5220
5221
5222
5223
5224
5225
5226
5227
5228
5229
5230
5231
5232
5233
5234
5235
5236
5237
5238
5239
5240
5241
5242
5243
5413
5415
5430
5431
5432.
5433
5434
5437
5488
5497
Paragraph.
84
124
136
137
138
139
140
70
142
143
146
147
148,149
150
72
73
151
153
154
144
155
156,157
125-127
129
162
130
170
171
172
173
174
175
224
225
83
DIGEST OF NATIONAL BANK DECISIONS.
CONTENTS.
Page.
ABATEMENT
...
ACCOMMODATION PAPER
_._
ACTIONS __
_
AGENT OF SHAREHOLDERS.
APPEAL
__
_
ASSESSMENT
_
_
ATTACHMENT
BONDS OF OFFICERS
_
BOOKS, INSPECTION OF
BRANCH BANKS
_
BROKER
CAPITAL STOCK
CASHIER
„
CERTIFICATE OF DEPOSIT
CERTIFICATION OF CHECKS
CHECKS
CIRCULATION
COLLATERAL SECURITIES
COLLECTIONS
.CONSTITUTIONALITY
CONSTRUCTION OF LAW
CONVERSION
CRIMINAL L A W . . .
_
DEPOSITS
DEPUTY COMPTROLLER
DIRECTORS
__
DISTRICT ATTORNEY.
_
DIVIDENDS
ESTOPPEL
EVIDENCE
_
EXECUTION
EXPIRATION
EXTENSION
F A L S E ENTRIES
FORFEITURE OF CHARTER
FORGERIES
GUARANTY..
INCREASE OF CAPITAL STOCK
INDICTMENT
INJUNCTION
98
98
99
103
104
105
116
119
121
122
122
122
125
125
127
129
134
135
139
147
148
148
150
157
162
162
162
162
163
166
170
170
170
170
173
173
176
178
178
181
Page.
INSOLVENT BANKS
INTEREST
JURISDICTION
_
LEASE
_.
LIABILITY OF BANK
, _
LIEN...
._
LIQUIDATION
__
LOANS
MANDAMUS
MARRIED WOMEN
MORTGAGE
NEGOTIABLE PAPER
NOTARY PUBLIC
NOTICE
_
OATH OF DIRECTOR
OFFICERS
OFFSET
_
PASS BOOK
__.
PLACE OF BUSINESS
POST NOTES
_
_
POWERS OF BANK
PRACTICE
PREFERENCE
PREFERRED CLAIMS
PRESIDENT
R E A L ESTATE
_
_
RECEIVER
REDUCTION OF CAPITAL STOCK . _
REPORT OF CONDITION . „
__
RESIDENCE
_
RESTRAINING ACTS
SAVINGS BANKS
SHAREHOLDERS
SPECIAL DEPOSITS
TAXATION
TRANSFER OF STOCK
ULTRA VIRES
USURY
VICE-PRESIDENT
VOTING
,
85
182
189
191
199
200
204
206
207
209
210
210
212
220
220
224
224
236
242
242
242
243
245
247
254
258
259
260
266
266
267
267
267
267
270
274
295
301
303
312
312
TABLE OF CASES.
A.
Page.
Aberdeen, First National Bank of, s.
Andrews etal
148,244,260
Aberdeen, First National Bank of, s.
Chehalis County et al....'.
277,294
Adair, Tax Collector, s. Robinson et al.
280
Adams s.Daunis..
195
Adams s. Mayor, etc., of Nashville
280
Adams s. Spokane Drug Company
239
JEtna National Bank s. The Fourth
National Bank
157
Agnewv. United States
157
Alabama National Bank s. Halsey
215
Albany, National Albany Exchange
Bank of, s. Hills e t a l
Albany City National Bank s. Maher,
Receiver, etc
J389
Albany, Supervisors of, s. Stanley
148
Alberger s. National Bank of Commerce
251
Albuquerque National Bank s. Perea.. 374,278
Aldrich et al., In re
288
Allen s. The First National Bank of
Xenia
207
Allentown, First National Bank, s.
Hoch
122,302
Allentown, First National Bank of, s.
Rex
273
Allentown National Bank s. Trexler
218
Alves s. Henderson National Bank
305
American Exchange National Bank s.
Crooks
233
American Exchange National Bank s.
Oregon Pottery Company
335
American National Bank s. Love
177
American National Bank s. National
Wall Paper Company
166
American Surety Company s. Pauly
121
Anderson s. Alton National Bank
146
Anderson s. Fir st National Bank
302
Anderson s. Gill
139
Anderson s. Kissam
326
Anderson s. Line
109
Andersons. Pacific Bank
250
Anderson s. Philadelphia Warehouse
Company
111,267
Andrews s. Varrell
236
Anheuser-Busch Brewing Association
s. Clayton
142
Anniston National Bank v. School Committee of Town of Durham
333
Armour Packing Company s. Davis....
146
Armstrong s. American Exchange NationalBank
183
Armstrongs. Bank
186
Armstrong s. National Bank of Boyertown
144
Armstrong s. Chemical National Bank.
137,
305,249
Armstrong s. Ettlesohn
366
Armstrong, In re
140,l&5,249
Armstrong s. Second National Bank of
Springfield
122,343,343
Armstrong s. Stanage
133,183,262
Armstrong s. Trautman et al
199
Armstrongs. Warner
241
Armstrong s. Wood
133,363
Arnau s. First National Bank
105
Arnot s. Bingham
147
Aspinwall s. Butler
134,166
Atchison, Exchange National Bank of,
s. Washita Cattle Company
196
Atlanta N ational Bank s. Davis
145
Atlantic National Bank s. Harris
149
Atlas National Bank s. Holm et al
316
Atlas National Bank s. Savery
191
Auburn, National Bank of, s. Lewis
305
Auburn Savings Banks. Hayes
184,349
Austins.The Aldermen
387
86
B.
Page.
Babcock s. Wolf
346
Bainet al. s. Peters
184
Bailey s. Mosher
225,232
Baileys. Sawyer
107,111
Baker s. Ault et al
181
Baker v. Texarkana National Bank
etal
104
Balbach et al. s. Frelinghuysen.. 142,158,3o6,355
Balchs. Wilson
338
Baldwin s. Canfield
259
Baldwin s. State National Bank of
Minneapolis
212
Ballinger National Bank s. Bryan
211
Baltimore, Central National Bank of,
s. Connecticut Mutual Life Insurance
Company
207
Baltimore, National Exchange Bank of,
s. Petersetal
330
Baltimore, Third National Bank of, s.
Boyd
200,304
Bangor, Merchants' National Bank of,
s. Glendon
166
Banks. Armstrong
245,265
Bank of Bethel s. Pahquioque Bank
100,
170,191,261
Bank s. Kennedy
361
Banks.Lanier
304,307,396,301
Banks. Latimer
353
Bank s. Mclntyre
149
Banks. Zent
273
Bank of the Metropolis s. First National
Bank of Jersey City
321
Bank of Redemption s. Boston
275,277,278
Barbour s. National Exchange Bank...
241
Barhorst et ux. s. Armstrong et al
182
Barnes s. Swift
199
Barnet s. Muncie National Bank
304
Bartlett s. Woodbine Savings Bank...223
Bashaw s. United States
162
Batchelor s. United States
152
Bates, In re
251
Bates s. Paddock
ia5
Bates s. Salt Springs National Bank
205
Bath Savings Institution s. Sagadahoc
National Bank
163,300
Bay or s. American Trust and Savings
Bank
1&5
Beal s. Essex Savings Bank
268
Beal s. National Exchange Bank of Dallas
144
Beal s. City of Somerville
355
Beardsley s. Webber.
213
Beavers. Beaver
161
Becker's Investment Agency s. Rea
808
Beckham s. Shackelford
263
Bell s. Hanover National Bank
137
Belleville, People's Bank of, s. Manufacturers' National Bank of Chicago
177
Benton s. German-American National
Bank
221
Benton s. Holmes
236
Berney National Bank s. Guy on
251
Bickford s. First National Bank of Chicago
138,139
BircTs Executors s. Cockrem
_
365
Birmingham National Bank s. Bradley.
102,
134,168,194
Birmingham National Bank s. Mayer..
185
Bissell s. The First National Bank of
Franklin
225
Blackmore v. Guarantee Company of
North America et al
120
Blackmore s. Woodward et al
112
Biaine, First National Bank of, s. Blake_
225
Blair s. First National Bank of Mansfield
234
Blanchard s. Commercial Bank of Tacoma
167,265
REPORT OP THE COMPTROLLER OF THE CURRENCY
Page.
Bletz v. Columbia National Bank
191
Blochu Creditors
134
Board of County Commissioners of Rice
County v. Citizens' National Bank of
Faribault
284
Board of Commissioners of Montgomery
County v. Elston
134,275
Bobs v. People's National Bank
304
Boone County National Bank v. Latimer
250
Booth etal. v. Welles
256
Boston, Central National Bank of, v.
Hazard e t a l
262
Boston, City of, v. Beal
263,281
Boston National Bank v. Jose
212
Boston National Bank v. City of Seattle.
282
Bosworth v. Jacksonville National Bank
203
Bowdell v. Farmers and Merchants'
National Bank of Baltimore
108,267,295
Bowden v. Johnson
107, 111, 166,267
Bowden v. Santos
296
Bowen v. Needles National Bank
247
Bowman etal. v. Clark e t a l
143
Bowman v. First National Bank
256
Boyeru Boyer
276,278,280
Boykin v. Bank of Fayetteville
146
Boynoll v. State
275
Braden's Estate, In re
125
Bradley v. The People
275
Brahan v. First National Bank
217
Branchv. The United States
161
Branch v. United States National Bank.
146
Bresslerv. Wayne County
290
Breyfogle et al. v. Walsh et al
181
Briggsv. Spaulding
227,232,261
Brinckerhoff v. Bqstwick
100,193; 231
Britton v. Evansville National Bank
277
Brodrick v. Brown
112
Brooke v. Tradesmen's National Bank.
132
Brown v. Carbonate Bank of Leadville.
253
Brown v. Farmers and Merchants' National Bank
164,234
Brown v. Finn
267
Brown v. First National Bank
165
Brown v. French
166,181.265.293
Brown v. The Second National Bank of
Erie
310
Bruner v. First National Bank
189
Buchanan et al. v. Drovers' National
Bank of Chicago
304
Buchanan County, First National Bank
of. v. Deuel County
194,209
Buftalo County National Bank v. Gilcrest
105
Buffalo, Farmers and Merchants' Na*
tionalBank of, v. Rogers
246
Buffalo German Insurance Company v.
Third National Bank
206
Buie v. Commissioners of Fayetteville..
292
Bullard v. Bank
122,204,296
Bundyu. Cocke
114
Bundy v. Jackson
297
Buntv. Rheum
181
Burbage v. American National Bank...
223
Burlington, Howard National Bank of,
v. Looinis
212
Burnham et al. v. First National Bank
of Leoti
192
Burrill v. President, Directors, etc., of
the Nahant Bank
231
Burroughs v. Tradesmen's National
Bank
133
Burrows v. State
132
Buehnell v. Leland
116
Burt u. Bailey
268
Burtnett, Administrator, v, The First
National Bank
158
Burton v. Burley
242
Bushnell v. The Chautauqua County
National Bank
243
Butler, Receiver, v. Aspinwall
109
Butler et al. v. Cockrill
164,185,205
Butler v. Coleman
119
Butlerv. Demmon
119
Butler v. Eaton
105,124.267
Butler v. Mixter
_
119
Butleru Poole
101-108
Butler v, Whitney
119
87
C.
Page.
163
Cadiz, Bank of, v. Slemons
164
Cadle v. Baker
191
Cadle v. Tracy
133
Cady v. Case
Cake v. The First National Bank of
310
Lebanon
California Bank v. Kennedy
115,199,270
Camden, National State Bank of, v.
Pierce
280
Cameron v. First National Bank
208
Campbell v. City of Haverhill
115
Campbell v. First National Bank
235
Canfield v. The State National Bank of
Minneapolis
208
Carlisle, First National Bank of, v.
Graham
204
Carthage, City of, v. First National
Bank of Carthage
280
Caseu.Bank
101,111,296
Case v. Citizens' Bank of Louisiana. 247,248,298
Case, Receiver, v. Small
109,261
Casev. Terrell
193,261
Casey v. Adams
100
Casey v. Galli
105,106,111,149,164,166
Casey v. La Societe de Credit Mobilier
de Paris
163,184,248,301
Castle v. Corn Exchange Bank
134
Castles v. City of New Orleans
280
Cecil National Bank v. Thurber
181
Central National Bank v. P r a t t
303
Central National Bank v. Richland National Bank
117
Central National Bank v. Spratlen
203
Central National Bank v. United States.
274,
277,278
Centralia, First National Bank of, v.
Marshall
207
Charleston v. People's National Bank.. 124,275
Charlotte, First National Bank of, v.
National Exchange Bank of Baltimore
243
Charnley v. Sibleyet al
240
Chase National Bank v. Faurot
214,309
Chattahoochee National Bank u Schley.
270
Chattanooga, National Bank of, v.
Mayor
280
Chemical National Bank v. Armstrong.
137,
190,203,264
Chemical National Bank v. B a i l e y . . . . . .
183
Chemical National Bank v. City Bank.. 194,203
Chemical Bank v. City Bank of Portage.
103
Chemical National Bank v. Hartford
Deposit Company
184,199,200,265
Chemung, National Bank of, v. Elmira.
286
Chesapeake Bank v. The First National
Bank of Baltimore
147
Chetwood v. California National Bank.
104
Chetwood, E x p a r t e
103,104,266
Chicago, First National Bank of, v.
Corbin
198
Chicago, First National Bank of, v.
Reno County Bank
139
Chicago, First National Bank of, v.
Steinwayet al
196
Chicago, German National Bank of, v.
Kimball
290
Chicago, Merchants' National Bank of,
et al. v. Sabin et al
170
Chicago Railway Equipment Company
v. Merchants' Bank
220
Chipman v. Ninth National Bank
162
Chism v. First National Bank
133
Chrystieet al. u Foster
234
Chubb v.Upton
125
Cincinnati, Hamilton and Dayton Railroad Company v. Metropolitan National Bank
101
Cincinnati, Union National Bank of, v.
Miller, treasurer of Hamilton County,
Ohio
:....
195
Cincinnati Oyster and Fish Company v.
National Lafayette Bank
129
Circleville, First National Bank of, v.
Bank of Monroe
140
Citizens' Bank v. Houston
145
Citizens * Bank of Louisiana v. Janin
137
Citizens'National Bankv. Dowd.
183,256
Citizens' National Bank v. Wintler
234
88
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Page.
City National Bank v. Paducah
275
City Natio aal Bank v. Phelps
148
City National Bank v. Thomas
177
Claasen,in re
156
Claasen v. United States
155
Clafflm v. Houseman
191
Clarion, First National Bank of, v.
Brenneman's executors
170
Clarion, Second National Bank of, v.
Morgan
309
Clarke National Bank v. The Bank of
Albion
127,225
Clemmer v. Drovers' National Bank . . .
159
Cleveland, Cincinnati, Chicago and St.
Louis Railway Company v. Hawkins
et al
I.
273
Cleveland, Brown & Co. v. Shoeman...
135
Cleveland, Commercial Bank of, v. Simmons
195
Clews et al. v. Bardon et al
229
Clinton, Iowa, National Bank of, v. Dorset Pipe and Paving Company
247
Cochecho National Bankv. Haskell.— 163,225
Cochran v. United States
172,266
Cockrill v.Butler etal
233
Coffey v. The National Bank of Missouri 149,270
Coffinu United States
152,153,154,180
Collinsv. Chicago
274
Collins v. State
158
Colt v. Brown
237
Columbia National Bank v. Rice.... 164,168,223
Columbia National Bank v. Western
Iron and Steel Company
102,215
Columbus, The First National Bank of,
plaintiff in error, v. Garlinghouse
etal
310
Commercial Bank of Pennsylvania v.
Armstrong
142
Commercial National Bank v. Armstrong
144
Commercial National Bank v. Canniff..
105
Commercial National Bank v. First National Bank
133
Commercial Bank, In re
159,250
Commercial National Bank v. King
County
282
Commercial National Bank v. Lipp
187
Commercial National Bank v. City of
Seattle
282
Commissioners of Rice County v. Citizens' National Bank of Faribault
275
Commissioners of Silver Bow County
v. Davis
290
Commonwealths. Barry.,
151
Commonwealth v. Deposit Bank
282
Commonwealth v. Farmers' Bank
282
Commonwealth v. Felton
150,191
Commonwealth v. Merchants and Manufacturers' National Bank
282
Commonwealth v. Bank of Kentucky..
282
Commonwealth v. Frankfort National
Bank
282
Commonwealth v. Tenney
150
Commonwealth v. Manufacturers and
Mechanics' Bank of Philadelphia
280
Commonwealth v. State National Bank.
282
Commonwealth Bank v, Clark
259
Commonwealth ex rel. Torrey v. Ketner 151,191
Concord, First National Bank of, v.
Hawkins
115
Concordia, First National Bank of, v.
Rowley
308
Conklin y. The Second National Bank..
296
Connecticut River Banking Company
et al. v. Rockbridge County
265
Consolidation National Bank v. Fidelity
and Casualty Company of New York.
120
Continental National Bank v. Eliot National Bank et al
117
Continental National Bank v. McGeoch. 187,232
Conwayv.Halsey
100,231
Conzman v. First National Bank
281
Cooke v. The State National Bank of
Boston
127
Cook County National Bank v. United
States
236,254
Cooper Insurance Company v. Hawkins.
302
Cooper v. Leather Manufacturers' National Bank
198
Page.
Corcoran v. Batchelder
207
Corn Exchange Bank v, Blye
262
Corn Exchange Bank v. Mechanics' National Bank of Newark, N. J
117
County Commissioners v. Farmers and
Mechanics' National Bank
275,290
County of Lancaster v. Lancaster County National Bank
289
Covington City National Bank v. Commercial Bank
223
Covington, Ky., Farmers and Traders'
National Bank of, v. Greene et al
167
Covington, City of, v. First National
Bank
282
Covington, City of, v. German National
Bank
282
Cox v. Elmendorf
269
Cox v. Montague
115
Coxv. Robinson
244
C r a g i e e t a l . v.Hadley
254,256
Craigie v. Smith
143
Crane y. F o u r t h Street National Bank.
14C
Creveling e t al. v. Bloomsbury N a t i o n a l
Bank
131
Crocker v. F i r s t N a t i o n a l Bank of Chetopa
304
Crocker v. Marine N a t i o n a l Bank of
New York
195
Crocker v. Whitney
259,260
Crook v. First National Bank
102,160
Cruikshank v. Fourth National Bank..
196
Cummings v. National Bank
278
D.
Dakota, National Bank of, v. Taylor
298
Dallas, National Exchange Bank of, v.
Beal
141
Danforth et al. v. National State Bank
of Elizabeth
304
Darby v. Berney National Bank
228
Davenport Bank v. Davenport
276
Davenport National Bank v. Mittelbuscher, Collector, et al
148
Davis v. Cook
191,267
Davis v. Elmira Savings Bank
250
Davis u. Essex Baptist Society
107,267
Davis v. Industrial Manufacturing
Company
237
Davis v. Knipp
240
Davis v. Randall
303
Davis, Receiver, v. Stevens
108,267
Davis v. Weed
106
Dearborn v. The Union National Bank
of Brunswick
136
Dearborn v. Washington Savings Bank.
159
Decatur, First National Bank of, v.
Johnston
249
Decatur, First National Bank of, v.
Priest
202
Decorah, First National Bank of, v.
Holan
215
DeHaven v. Kensington National Bank.
204
Delano v. Butler
106,124
Delaware, Lackawanna and Western
Railroad Company v. Oxford Iron
Company
204
Denton v. Baker
_
266
| Denver, American National Bank of, v.
National Benefit and Casualty Company et al. (Wiswall,. inter vener)
264
Deposit Bank v. Franklin County
282
Des Moines National Bank v. H a r d i n g . .
210
Ditty v. Dominion National Bank of
Bristol, Va
189,20i
Dorchester, First National Bank of, v.
Smith
_
308
Doty v. First National Bank
309
Doud et al. u National P a r k Bank
176
Dougherty v. Hoffstetter
213
Dow. v. Irasburgh National Bank of
Orleans
196
Drake v. Rolio
_
237
Dresser v. Traders' National Bank
_
302
Driesbach v. National Bank
304
Drover's National Bank v. Blue
214
Dumond v. Merchants' National Bank.
201
Dumontv.Fry
206
REPORT OF THE COMPTROLLER OP THE CURRENCY.
Page.
Duncan v. First National Bank of
Mount Pleasant
Dutton v Citizens 1 National Bank
Dutton v. First National Bank
190
383
283
E.
Eans v. Exchange Bank
149
East Ei ver National Bank v. Gove
201
Eastern Townships Bank v. Vermont
National Bank ot St. Albans and
another
309
Eaton v. Pacific National Bank
183
Eaton v. Union County National Bank..
383
Eccles v. Drovers and Mechanics' National Bank
365
Elder v. First National Bank of Ottawa.
307
Elkhart, First National Bank of, v. Armstrong
141
Ellis v.Little
361
Ellis v. First National Bank of Olney..
305
El Paso National Bank v F u c h s . . . . 303,341,373
El wood v. First National Bank
307
Eno, Inre
193
E vansville Bank v. Britton
380
Evansville, First National Bank of, v.
Fourth National Bank of Louisville.. 300,331
Evansvilie National Bank v. Metropolitan National Bank
_
397
Evans v. United States
179
Erisman v. Delaware County National
Bank
99
Exchange National Bank v. Clement-..
118
Exchange National Bank v. Johnson
etal
317
Exchange National Bank v. Wolverton.
313
E x e t e r National Bank v. Orchard
308,309
F.
Fairbanks v. Merchants' NationalBank.
334
Fairhaven, National Bank of, v. The
Phoenix Warehousing Company.. 133,163,367
Fallkill National Bank v. Sleight
311
F a r m e r s ' Bank v. Board of Councilmen
of City of F r a n k f o r t
383
F a r m e r s ' Bank v. Franklin County
383
F a r m e r s ' Bank v. City of H e n d e r s o n . . _
283
F a r m e r s ' National Bank v. Backus
346
F a r m e r s ' N a cional Bank v. Dear ing
305
F a r m e r s ' National Bank v. Thomas
_
99
F a r m e r s a n d Mechanics' Bank v. Baldwin
301
F a r m e r s a n d Mechanics' Bank v. Dearing
147,303
F a r m e r s and Mechanics' Bank v. Hoagland
307
F a r m e r s and Merchants' National Bank
v. Novitch
318
F a r m e r s and Merchants' National Bank
v. Smith
303
F a r m e r s and Merchants' National Bank
v. Waco Electric Railway and Light
Company
105,118,164,187,305,308,314,365
F a r m e r s and T r a d e r s ' National Bank v.
Connor
303
F a r m e r s a n d T r a d e r s ' National Bank v.
Hoffman
282
F a r m e r s and T r a d e r s ' National Bank v.
Snodgrass
177
Fidelity and Casualty Company of N e w
York v. Consolidated National Bank.
130
Fidelity Safe Deposit a n d T r u s t Company v. A r m s t r o n g
199
Fifth National Bank v. Armstrong, e t c . 141,144
Fifth National Bank v. Central National
Bank
133
Finn v. Brown
107,164
F i r s t National Bank v. Allen
173
F i r s t National Bank v. A r m s t r o n g
144
F i r s t National Bank v. A y e r s
_
383
F i r s t National Bank v. Bailey
282
F i r s t National Bank v. Bayliss
311
F i r s t National Bank v. Bonner
_
218
F i r s t National Bank v. Brodhecker
380
F i r s t National Bank v. California N a tionalBank
169
F i r s t National Bank v. Cass County
105
F i r s t National Bank v. C a r t e r
311
89
Page.
F i r s t National Bank v. Cecil
316
F i r s t National Bank v. Chehalis County
383
First National Bank v. Chilson
213
F i r s t National Bank v. City National
Bank
146
F i r s t National Bank v. City of Richmond
395
F i r s t National Bank v. Clark
133,160
First National Bank v. Cody
169
F i r s t National Bank v. Collins
215
First National Bank v. Commercial National Bank
251
F i r s t National Bank v. Craig.
145
F i r s t National Bank of Decorah v.
Holan
215
F i r s t National Bank v. De Morso
239
F i r s t National Bank v. District Township of Doon (Iowa)
163
F i r s t National Bank v. Douglas County. 277,284
First National Bank v. Dovetail Body
and Gear Company
164,187
F i r s t National Bank v. Forest
191
F i r s t National Bank v. G a r l i n g h o u s e . . .
303
F i r s t National Bank v. G r u b e r
190
F i r s t National Bank v. Haire
260
First National Bank v. H a r r i s
219
F i r s t National Bank v. Hellyer
168
F i r s t National Bank v. Hershire
284
F i r s t National Bank v. Hughes
146
F i r s t National Bank v. Huntington Distilling Company
205
First National Bank v. L a m b e r t
211
F i r s t National Bank v. Laughlin
213
F i r s t National Bank v. Ledbetter
223,309
F i r s t National Bank v. L i n d e n s t r u t h . . .
205
F i r s t National Bank v. Lynch
165
F i r s t National Bank v. Mann
138
F i r s t National Bank v. Mansfield Savings Bank
145
F i r s t N ational Bank v. Marshall
211
F i r s t National Bank v. Marshall a n d
Ilsley Bank
165,211
F i r s t National Bank v McKinney
168
F i r s t National Bank v. Mclnturff
309
F i r s t National Bank v. Merchants' National Bank
132
F i r s t National Bank v. Miller
133
F i r s t National Bank v, Morgan
192,304
F i r s t National Bank v. Munzesheimer.
301
F i r s t National Bank v. National Exchange Bank
243,301
F i r s t National Bank v. Nelson
133
F i r s t National Bank v. N o r t h w e s t e r n
NationalBank
129,174
F i r s t National Bank v. Peavey
133
F i r s t National Bank v. Peltz
160
F i r s t National Bank v. P e t e r b o r o u g h . .
275
F i r s t National Bank v. Sanford
251
F i r s t National Bank v. Schmidt
138
F i r s t National Bank v. City of Seattle..
283
F i r s t National Bank v. Smith
215
First National Bank v. Stuetzer
219
F i r s t National Bank v. Still
130
First National Bank v. Stone
164
F i r s t National Bank v. T u r n e r
309
F i r s t National Bank vm Van Ness
216
F i r s t National Bank v. Weston
223
F i r s t National Bank v. Wills Creek Coal
Company
133
F i r s t National B a n k u Wood
99
F i r s t National Bank v. Zeims
213
Fisher v. Adams
264
Fisher v. Continental National B a n k . . .
1&5
Fisher v. Denver National Bank
138
F i s h e r u Knight
238
Fisher v. Simons
264
Fisher v. Tradesmen's National Bank..
184
Fisher v. United States National Bank.
185
Fisher v. Yoder
193
Flannegan et al. v. California National
Bank e t a l
225
Flint v. Board of Aldermen of Boston..
284
Flint Road Cart Company v. Stephens.
254
Florence Railroad and Improvement
Company v. Chase National Bank
98,308
Flour City National Bank v. G r o v e r . . . .
213
Flour City National Bank v. Miller
309
Foil's appeal
296
90
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Page.
Forster v. Second National Bank
102
F o r t E d w a r d , National Bank of, v. T h e
Washington County National B a n k . .
201
F o r t i e r v. New Orleans National Bank. 244,259
F o r t Scott, F i r s t National Bank of, v.
Drake
232
F o r t W o r t h , City National Bank of, v.
Hunter
209
F o r t Worth, City National Bank of, In r e
209
Foss v. F i r s t National Bank of Denver.
197
Foster v. Chase et al
*
113
Foster v. Lincoln et al
113,115,300
F o s t e r s . Rincker
143
Foster v. Wilson
269
F o u r t h Street National Bank v. Yardley, Receiver
254
Fowler v. Scully
259
Fox v. Home Coinnany
99
Franklin County National Bank v. Beal.
143
Franklin National Bank v, Newcombe.
138
F r a z e r u Seibern
275
Freeman Manufacturing Company v.
National Bank of Republic
181
Freiberg v. Stoddart
143
Frelinghuysen, Receiver, etc., v. Baldwin e t a l
265
FriberguCox
134,189
Friend, I n r e
,
145
Fridleyv. Bowen
259
Furberv. Stephens
256
H.
Page.
Hackettstown National Bank v.Ming.. 165,181
Hadden e t a l . v. Dooley e t al
104
Hadeu.McVay
191
Hagar v. Union National Bank
116,204
Hale v.Walker
267
Hallamv.Tillinghast
197
Hallowell National Bank v. Marston
218
H a m b r i g h t v. National Bank
311
H a m e r v. F i r s t National Bank
169
Hammond ^.Hastings
204
Hancock National Bank v. Ellis
268
Harrington v. F i r s t National Bank of
Chittenango
224,225
H a r v e y v. Allen
117
Harvey v. Girard National Bank
147
Harvey, receiver, etc., v. Lord
98
H a t c h v. Johnson Loan a n d T r u s t Company
220
H a t h a w a y v. F i r s t National Bank of
Cambridge
247
H a u e r w a s v. Goodloe
168
Haugan u S u n w o l
226
H a u p t m a n v. F i r s t National Bank
158
Havens v. National City Bank of Brooklyn
119
Hawkins v. State Loan a n d T r u s t Company
103
Hayden v. Chemical National Bank
188
Hayden v. Thompson
101,162,173,185
Hayes, Receiver, v. Beardsley
249
Hayes v. Shoemaker
110,296
G.
H a y ward v. Eliot National Bank
165
Garfield National Bank v. Kirchway . .
105 Hazard v. National Exchange Bank of
Newport
297
G a r d n e r s . Dunn
214
Garner v. Second National Bank
11« Heath v. Second National Bank of Lafayette
259
Garnett, First National Bank of, v.
133,239
Ayers
283 Heidelbach v. National Park Bank
G a t c h v . Fitch
111,248 Hendee v. Connecticut and Passumpsic
Railroad Company..
193
Georgia National Bank v. Henderson . .
201
101
German National Bank v. Leonard
168 Henderson v.Myers
Henderson v. O'Connor
144
German National Bank v. Louisville
Butchers' Hide and Tallow Company.
104 Henderson, use of S e c o n d National
Bank of Titusville, v. Waid
311
German National Bank v. Meadowcroft.
163
305
Germanica National Bank v. Case
197 Hennessy v. City of St. Paul et al
269
Gernerv. Thompson..
101,173 Hepburn v. Danville National Bank
Hepburn v.Kincannon
186
Getman v. Second National Bank of Os373
wego
311 Hepburn v. School Directors
262
Gettysburg National Bank v. Chisolm..
213 Herman, In re
278,284
Gibbons v. Anderson et al
233 Hershire v. First National Bank
220
Gibbons v. Hecox
205 Hettinger v.Meyers
268
Gibbs v. Howard
236 Hibernia National Bank, appeal of
186
Gibson v. Peters, receiver
162 Higgins v. Worthington
Glenn v. P o r t e r
299 Higntstown, First National Bank of, v.
Christopher
221
Gloversville, National Bank of, v. Wells.
246
Higley v. The First National Bank of
Gold Mining Company v. Rocky MounBeverly
_
310
tain National Bank
207
307
Goldsbury v. Inhabitants of W a r w i c k .
286 Hill v. National Bank of Bar re
280
Goldthwaite v. National Bank
238 Hills v. Exchange Bank
Himrodv. Baugh
236
Gordon v. Third National Bank of Chat190
tanooga
220 Hines v. Marmolejo
303,
Goshen National Bank v. State
201,221 Hintermister v. First National Bank...
304,305
Graf ton, First Nations!! Bank of, v. Bal100
bridgeetal
222 Hirsh v. Jones e t a l
192
Graham v. National Bank of New York.
259 Hiscockv. Lacy
261
G r a n t v. Spokane National Bank e t a l . .
263 Hitzv. Jenks
108
Gravest?. Corbin
198 Hobart, Receiver, etc., v. Gould
108
Graves v. The Lebanon National Bank.
119 Hobart, Receiver, etc., v. Johnson
103
Graves v. United States
157 Hobbs v. Chemical National Bank (Ga.).
232,297
G r a y v. Rollo
236 Hobbs v. Western National Bank
196
Green v. Purcell National Bank
134 Hokev. People
259
Green v. Wallkill National Bank
100,101 Holmesv. Boyd
Holtv. Thomas
112
Greenville, First National Bank of, v.
Sherburne
245 Homer v. National Bank of Commerce. 206,241
257
Griffinu Peters
252 Hopkinsville,City Bank of, v. Blackmore
134,275
G r o w v . Cockrill
209 Hornev. Greene
Hortonu
Mercer
268
Gruber v. First National Bank of Clarion
311 Hot Springs Independent School District,
etc.,
v.
First
National
Bank
of
G r u n d y County National Bank v. RuliHot Springs
193
son
170
Howe u. Barney e t a l
100,230
Guelich v. The National State Bank of
286
Burlington
139 Howell v. The village of Cassopolis
Hower v. Weiss Malting and Elevator
Guernsey v. Black Diamond Coal and
Company etal
181
Mining Company (Iowa)
189
Huffaker v. National Bank of MontiGuild v. F i r s t National Bank of Deadcello
163,165
wood
307
1
Guntersville, Bank of, v. W e b b
159 Hugging et al. v. Citizens National
Bank of Kansas City
308
Guthrie v. Reid
139,311
REPORT OF THE COMPTROLLER OP THE CURRENCY.
Hughes v. Neal Loan and Banking Company
145
H u g h i t t v . Hayes
.—237
Hillings v. Hulings L u m b e r Company
etal
132
Humphreys v. Third National Bank of
Cincinnati, Ohio
169,246
Hungerford National Bank v. Van Nostrand
169
Hunt, Appellant
126
Huntjnre
242
Hunt v. Townsend
143
Hutchinson National Bank v. Crow
167,260
I.
Illinois Paper Company v. Northwestern National Bank
251
Illinois Trust and Savings Bank v. First
National Bank and another, Receiver,
etc
255
Imperial Roller Milling Company v.
First National Bank
236
Implement Company v. Stevenson
125
Importers and Traders' National Bank
v. Peters e t a l
144
Indian Head National Bank v. Clark...
215
Indiana National Bank v. First National
Bank
174
Indianapolis, Meridian National Bank
of, v. First National Bank of Shelbyville
129
Insurance Company v. Phinney
235
Irons et al. v. Manufacturers1 National
Bank of Chicagoetal
109,114,306,261,296
Israel v. Gale
99
J.
Jackson v. Fidelity and Casualty Company
266
Jackson v. United States
236
Jacobus v. Monongahela National Bank
of Brownsville
117
Jefferson, National Bank of, v. Bruhn
etal
136,190
Jefferson, National Bank of, v. Fare et al 147,193
Jenkins v. National Village Bank of
Bowdoinham
136
Jewett v. Whitcomb
193
Jewett et al. v. Yardley
189
Johnson v. Laflin
295,296
Johnson v. National Bank of Gloversville
303,305
Johnston v. Charlottesville National
Bank
98
Johnston Fife Hat Company v. National
Bank
203
Jones v. Rush ville National Bank
281
Jordan, administratrix, etc., v. The
National Shoe and Leather Bank of
New York
236,301
K.
Kaiser et al. v. First National Bank of
Brandon
217
Kaiser v. United States National Bank
(Ga.)
103
Kansas City, Mo., Metropolitan National Bank of, v. Campbell Commission Company
252
Kansas City, Merchants' National Bank
of, v. Lovitt
222
Kansas National Bank v. Quinton
245
Kansas Valley National Bank v. Rowell.
259
Kelley v. Phoenix National Bank
147
Kelly, Maus & Co. v. Sioux National
Bank e t a l
198
Kelsey v. The National Bank of Crawford
149
Kennedy v. California Savings Bank
etal
244
Kennedy v. First National Bank
300
Kennedy v. Gibson
100,
101,105,106, 111, 112,113,162,261, ?M
Kentucky, Bank of, v. Armstrong
282
Kentucky, Bank of, v. Board of Councilmen of City of Frankfort
282
91
Kentucky Flour Company's Assignee
v. Merchants' National Bank
242
Kerrv.Urie
116
Kesner v. World's Fair Hippodrome
269
Keyserv. Hitz
106,162,210,267
King et al. v. Armstrong, Receiver
112,239
Kingman, Citizens' National Bank of, v.
Berry e t a l
233,235
Kirkwood v. Exchange National Bank.
221
Kirkwood v. First National Bank
221
Kissamv. Anderson
188
Klepper v. Cox
189
Kylev. The Mayor, etc
284
L.
Lacon, The First National Bank of, v.
Myers
126
La Dow v. First National Bank
190
La Fayette, The National State Bank
of.v.Ringel
126
La Grande National Bank v. Blum
212
La Grande Butter Tub Company v. National Bank of Commerce
251
Laing v. Burley
106
Lake Erie and Western Railroad Company v. Indianapolis National Bank.,
250
Lake National Bank v. Wolfeborough
Savings Bank et al
196
Lanaux, La., Succession of
268
Lancaster County National Bank v.
Boffenmyer
216
Lanham v. First National Bank
308
La Rose et al v. Logansport National
Bank e t a l
119
Latimerv. Bard e t a l
125
Latimer v. Wood e t a l
99
Lawrence v. Stearns.
166,235
Lazear v. National Union Bank of Baltimore
301,303,304,311
Leach v. Hale
244,271
Leather Manufacturers' National Bank
v. Cooper, jr
192
Lebanon National Bank v. Karmany
312
Lehman v. Rothbarth
105
Leoti, First National Bank, v. Fisher...
274
Le Sassier v. Kennedy
192
Lewis v. Switz
113,268
Lexington, Town Council of, v. Union
National Bank
103
L'Herbette v. Pittsfield National Bank. 158,203
Libby v. Union National Bank
259
Lilianthal, In re
118
Lilly v. The Board of Commissioners of
Cumberland County
134,275
Lincoln National Bank v. Butler
218
Linn County National Bank v. Crawford
98,
193,194,214
Lionberger v. Rouse
275
Little Rock, Merchants' National Bank
of, v. United States
135,278,291
Lockwood v. The American National
Bank
149,224
Logan County National Bank v. Townsend
147,192,243,301
Louisiana, Citizens' Bank of, v. Board of
Assessors
278
Louisiana, Citizens' Bank of, v. Janin._
137
Louisville Banking Company v. City of
Louisville
282
Louisville, City of, v. Bank of Kentucky.
282
Louisville, Third National Bank of, v.
Vicksburg Bank
204
Lowell, Prescott National Bank of, v.
Benjamin F.Butler
244
Luberg v. Commonwealth
151
Lucas v. Government National Bank . .
303
Lyndon ville National Bank v. Fletcher. 164,175
Lyons v. Lyons National Bank
243
Lyons, First National Bank of, v. Ocean
National Bank
225,231
M.
Madison, National Bank of, v. Davis
306,310
Magrxider v. Coltson
296
Maguire v. Board of Revenue and Road
Commissioners of Mobile County
294
Main, Assignee, v. Second National Bank
of Chicago
195
92
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Page.
Page.
Manufacturers 1 National Bank v. ConMiller v. National Bank of Lancaster..
196
tinental Bank et al
144 Miller v. Western National Bank
159
Manufacturers' National Bank, In re . .
183 Milmo National Bank v. Carter
165
Mapes v.Scott
259,260 Missouri River Telegraph Company v.
Marbury u. Farmers and Mechanics'
First
National
Bank
of
Sioux
City....
192,305
National Bank
136
v. The National Bank of BloomingMarine National Bank v. Humphreys...
216 Mix
ton
166
Market Bank v. Pacific National Bank..
248 Mize
v. Bates County National Bank...
268
Market and Fulton National Bank v.
Mobile,
National
Commercial
Bank
of,
Sargent
217
v.
Mayor,
etc.of
Mobile
291
Marshall National Bank v. O'Neal
133
National Bank v. OverMasseyv. Fisher
184,240,250 Monongahela
holt
311
Mathews v. Columbia National Bank of
First National Bank of, v.
Tacomaetal
124 Monmouth,
Brooks.
201
Matthews v. The Massachusetts NaMontagu
et
al.
v. Pacific Bank et al . . . .
273
tional Bank
225 Montgomery, First
National Bank of,
Matthews v. Skinker
260
v. Armstrong
_
141
Maynardv. Bank
149 Monticello Bank v. Bostwick et al
175
Mayor v. First National Bank of Macon
278 Montpelier, First National Bank of, v.
McAden v. Commissioners of MecklenHubbardetal
195
burg County..
292 Montpelier, First National Bank of, v.
McBee v. Purcell National Bank
161
Sioux City Terminal Railroad and
McCann v. First National Bank of JefWarehouse Company (Trust Comfersonville
125
pany of North America, intervener).
210
McCartneys. Kipp
208 Moore v. Jones
108,267
McClellan v.Chipman
254 Moore v. Mayor and Commissioners of
McConvillev. Gilmour
103
Fayetteville
292
McCord v. California National Bank—.
133 Moores v. Citizens' National Bank of
McCormick v. Market National Bank...
148,
Piqua
221
200,302 Morehouse v. Second National Bank of
McCulloch V.Maryland
147
Oswego
312
McFarlin v. First National Bank
268 Morris v. Eufaula National Bank
203
McGhee v. First National Bank of
Morrison v. Price
109
Tobias
308 Mound City Paint and Color Company
McGhee v. Importers and Traders' Nav. Commercial National Bank
147
tional Bank
178 Mount Pleasant, First National Bank
Mclver v. Robinson
276
of, v. Tinsman
190
McLoghlin v. National Mohawk Valley
Mount Sterling National Bank v. Green.
160
Bank
167,191 Movius, Receiver, etc., v. Lee et al
224,228
McMahon, In re, v. Palmer
290 Multnomah County et al. v. Oregon NaMcVeagh v. The City of Chicago efca l . . .
285
tional Bank et al
250
Mead v. National Bank of Pawling
219 Murphy v. First National Bank
158
Meldrum v. Henderson
186 Murray v. American Surety Company
Memphis National Bank v. Sneed
99
of New York
."
186,194
Mend ota, First National Bank of, v.
Murray v. Pauly
126
Smith
286 Mustard v. Union National Bank
191
Mercantile Bank v. New York
274,277
N.
Mercantile National Bank v. Shields
281
Mercer v. Dyer
239
248
Merchants' National Bank v. Ault
105 National Bank v.Butler
304
Merchants' National Bank v. Carhart..
272 National Bank v. Carpenter
105,106,135,267,296
Merchants' National Bank v. Demere..
136 National Bank v. Case
National Bank of Redemption v. City
Merchants' National Bank v. Guilmarof Boston
292
tin
272
118,183
Merchants' National Bankv. McAnulty
105, National Bank v. Colby
169,215 National Bank v. Commonwealth... 254,277,294
312
Merchants' National Bank v. McGee...
153 National Bank v. Danf orth
231
Merchants' National Bank v. McNeir . .
168 National Bank v. Drake
Merchants' National Bank v. Mears
260 National Bank of Fayette County v.
Dushane
310
Merchants' National Bank v. Peet
105
244
Merchants' National Bank v. Robinson.
239 National Bank v. Earl
National Bank v. Graham
270
Merchants' National Bank v. Sevier
806
etal
307 National Bank v. Insurance Company..
190
Merchants* National Bank v. Spates . . . 102,215 National Bank v. Johnson
National Bank v. Kennedy
100
Merchants' National Bank v. State Na259,260
tional Bank
127,128,201,242,243 National Bank v. Matthews
217,269
Merchants? National Bank v. Tracy
220 National Bank v. Taylor
292
Merchants and Farmers' Bank v. Austin
144 National Bank v. United States
National Bank v. Whitney
259
Merchants a n d Manufacturers' National Bank v. Cummings
138 National Bank of Commerce v. Atkinson
98,233,245
Merchants and Manufacturers' Bank v.
Pennsylvania
294 National Bank of Commerce v. City of
Seattle
282
Merchants and Planters' National Bank
v. Trustees of Masonic Hall
170,265 National Bank of Commerce v. Galland. 167,315
I National Bank of Commonwealth v MeMerrill v. First National Bank of Jackchanics' National Bank
182,183
sonville
105,186
National Board of Marine Underwriters
Merrill v. Florida Land Improvement
v. National Bank of the Republic
174
Company
184,296
Metropolitan National Bankv. Claggett 149,192 National Commercial Bank v, McDonnell
135,163
Metropolitan Trust Company v. Farmers and Merchants' National Bank...
118. National Commercial Bank v. Miller &
Co
127,131
164,187,205,208,214,265
289,291
Meyers v. Valley National Bank
295 National Exchange Bank v. Hills
182
Michigan Insurance Bank v. Eldred
149 National Exchange Bank v. Peters et al.
Midland National Bank v. Schoen
21G National Exchange Bank v. Wilgus's
Executors
216
Miller's estate
135
Miller v. First National Bank
171 National Gold Bank and Trust Company
v. McDonald
132
Miller v. Heilbron
289
Miller v. Howard etal
232 National Park Bank v. Goddard
118
REPORT OF THE COMPTROLLER OF THE CURRENCY.
93
Page.
Page.
v. Second National Bank of
National Park Bank v. Gunst
99 O'Hare
Titusville
207
National Park Bank v. Harmon
115 Old
National B a n k u German American
National Pemberton Bank u Porter.. _
191
National Bank
145
National Security Bank v. Butler
249 OldhamuBank
219,341
National Security Bank v. Edward F.
First National Bank of, v. CounCushman
.224 Omaha,
tyof
Douglas
195,283
National Security Bank v. Price, ReNational Bank v. Walker et aL.
177
ceiver
248 Omaha
County Savings Bank v.
National State Bank v. Young
275 Onondaga
United States
145,174
NeaduWall
113,268 Ordway
v. Central National Bank
191,206
Nebraska National Bank v. Ferguson..
218 Ornn v. Merchants'
Bank
259
Neill v. Rogers Bros. Produce Company.
118 Osborne v. Bank of National
the
United
States..
147
Nelson v. Burroughs
100 Oswego, Second National Bank of, v.
Nelson v. First National Bank of KilBurt
225
lingly
138,167,230,223 Overholt v. National Bank of Mount
Newark Bank Company v. Newark
274,277
Pleasant
304
Newark, National State Bank of, v.
Boylan
306
P.
Newark, North "Ward National Bank
of, v. City of Newark
275 Pacific National Bank v. E a t o n . . 105,123,124,267
101,117
Newbegin v. Newton National Bank...
184 Pacific National Bank v. Mixter
P a l m e r v . McMahon
274,279
New berg, National Bank of, respond117
ent, v. Daniel Smith
161 Palmer v. National Bank of Allentown.
343
Newell v. National Bank of Somerset...
306 Pape v. Capital Bank of Topeka
P a r k e r v. Kobinson
113
New Orleans Canal and Banking Com158
pany v. City of New Orleans
291 P a r k e r s b u r g National Bank v. Als
P a r k h u r s t v. F i r s t National Bank of
New Orleans National Bank v. RayClyde
308
mond
:
260
Pattison v. Syracuse National Bank
243,270
New Orleans, Germania National Bank
303
of, v. Case
107 Pauly v. Coronado Beach Company
213
Newton National Bank v< Newbegin —
187 Pauly v. O'Brien
Pauly v. State Loan and T r u s t Company
116
New York Breweries Company v. Hig137
gins
158 Pauly v.Wilson
Pearce a n d Miller Engineering ComNew York, Chatham National Bank of,
pany u Brouer
138
v. Merchants' National Bank of West
178
Virginia, appellant
195 Pearce v. Rice
Peck et al. v. F i r s t National Bank
140
New York, Chemical National Bank of,
v. Armstrong
345 Pelton v. Commercial National B a n k . . . 376,378
Penn Bank v. F a r m e r s ' Deposit NaNew York, Germania Bank of, v. La
tional Bank
343
Folletteetal
314
Pennsylvania, Commercial Bank of, v.
New York, Market National Bank of, v.
Armstrong
143
Pacific National Bank of Boston
118
People ex rel. Williams v. Assessors of
New York, Mayor of, etc., v. Tenth
Albany
387
National Bank
209
People ex, rel. Williams v. Weaver
376
New York, Mercantile National Bank
People v. The Commissioners of Taxes
of City of, v. Mayor, etc., of City of
and Assessments
376
New York and another
393
People ex rel. Tradesmen National Bank
New York, Merchants' National Bank
v. Commissioners of Taxes and Assessof the City of, v. Samuel and another.
134
ments...
386
New York, National Shoe and Leather
People v. The Commissioners
376
Bank of the City of, v. Mechanics' Na376
tional Bank of Newark, N. J
117 People v. Dolan
People
v.
Fonda
197
New York, People's Bank of the City
People v. Merchants' Bank
145
of, v. Mechanics' National Bank of
105
Newark
118 P e o p l e s . Remington
People v. St. Nicholas Bank
127,340
New York, Security Bank of, v. National
163,343
Bank of the Commonwealth
101 People's Bank v. National Bank
People's Bank a n d T r u s t Company v.
New York Security and Trust Company
Tufts
__..___.
341
et al. v. Lombard Investment Com318
pany of Kansas et al
138,176 People's National Bank v. Clayton
People's Savings Bank v. Hughes
237
New York, The Metropolitan National
305
Bank of, v. Lloyd
130 Peterborough National Bank v. Childs
253
Niblack v. Cosier
136,374 P e t e r s v. Bain
266
Nichols v. State
159 P e t e r s v. Foster
195,263
Nickerson v. Kimball
288 Petition of P l a t t
Nicollet National Bank v. City Bank...
301 P e t r i v. Commercial National Bank of
Chicago
197
Niles v. Shaw
281
P e t t i l o n u Noble
196
Noblesville, Citizens' State Bank of, v.
Hawkins
302 Philadelphia, F o u r t h Street National
Bank of, v. Yardley
•_
358
North Bennington, First National Bank
140
.of, v. Town of Bennington
243 Philadelphia National Bank v. D o w d . . .
Northern Bank v. Bourbon County
282 I Philadelphia, Third National Bank of,
v. Miller
1
303,304
Northern National Bank v. Maumee
339
Rolling Mill Company
98 Phillerv. Jewett
98,138,344
North River Bank, In re
254 Philleru Patterson
Phillerv. Yardley
240
Northwestern National Bank v. J.
Phillips v. Mercantile National Bank of
Thompson & Sons' Manufacturing
the City of New York
201
Company
138
219
Norton v. Derby National Bank
103 P h i p p s e t a l . v. Harding
O.
Oates v. First National Bank of Montgomery
148,303
Ocean National Bank v. Carll
193,261
O'Connor v. B r a n d t
241
O'Connor v. Witherby
113
Oddie e t al. v. The National City Bank
of N e w York
130
Pickett v. Merchants' National Bank of
Memphis
Pickle v. People's National Bank
Pittsburg, Fifth National Bank of, v.
P i t t s b u r g h and Castle Shannon Railroad Company
P i t t s b u r g Locomotive a n d Car W o r k s
v. State National Bank of Keokuk
Pittsburg, Third National Bank of, v.
Mylin
..„
306
134
197
1&5
197
94
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Plaine, First National Bank of, v. Blake.
324
Plattv. Beach
263
Plattv.Beebe
164,166,262
Plattv.Bentley
236
Plattsburg, First National Bank v.
Sowlesetal
231
Pollard v. The State
147
Potter v. Beal et 1al
271
Potter v. Traders National B a n k . . . . . .
211
Poughkeepsie, City National Bank of,
v.Phelps
149
Prescottv. Haughey
232
Preston National Bank v. Emerson
169
Preston v. Prather
272
Price, Receiver, v. Abbott
262
Price, Receiver, v. Colson
262
Price, Receiver, v. Coleman et al
218
Price, Receiver of Venango National
Bank, v. Yates]
108,148,262
Price, Receiver, v. Whitney
109
Prosser v. First National Bank of Buffalo
269
Providence Institution for Savings and
Jewels v. City of Boston
287
P r y s e u Farmers'Bank
227
P u g e t Sound National Bank v. City of
Seattle
282
P u t n a m Savings Bank v. Beal
254,271
P u t n a m v. United States
154,235
Q.
Quanah, Tex., City National Bank of, v.
Chemical National Bank of St. Louis,
Mo
227
R.
Randolph National Bank v. Hornblower
129
Raynor v. Pacific National Bank
«...
117
Resh v. First National Bank of Allentown
161
Reynes v. Dumont
206
Reynolds v. Bank of Mt. Vernon
163
Reynolds v. Crawf ordsville Bank
259
Rhoner v. National Bank of Allentown.
117
Ricaud v. Tysen
103
Ricaud v. Wilmington Savings and T r u s t
Company et al
299
Rich v. State National Bank of Lincoln.
243
Richards v. Attleboro National B a n k . . .
170
Richards et al. v. Incorporated Town of
Rock Rapids
198
Richards v. Kountze
212
Richmond, First National Bank of, v.
Davis
143
Richmond, First National Bank of, v.
City of Richmond e t al
277
Richmond, First National Bank of, v.
Wilmington and Weldon Railway
Company
146
Richmond v. Irons
100,
107,111,191,206,261,267,296
Richmond, City of, v. Scott
276,286
Riddle v. Dow
211
Riddle v. First National Bank
125,242,260
Ridgely et al. v. First National B a n k . . .
211
Ridgely National Bank v. P a t t o n &
Hamilton
130
Ripley National Bank v. Latimer
108,223
Riverside Bank v. F4rst National Bank
of Shenandoah
129
Roberts, Receiver, etc., v. Hill, Administrator, etc
247
Robertson v. Buffalo County National
Bank
233
Robinson v. City of Wilmington e t a l . .
195
Robinson v. H a l l e t a l
232
Robinson v. National Bank of Newbern 117,196
Robinson v. T u r r e n t i n e e t al
112
Rochester, F i r s t National Bank of, v.
Harris
243
Rochester, F i r s t National Bank of, v.
Pierson
100,301
Rock Springs National Bank v. L u m a n .
222
Rockville, The National Bank of, v. The
Second National Bank of La F a y e t t e .
132
Rockwell v. F a r m e r s ' National B a n k . . 190,306
Roeblmg Sons Company v. First National Bank e t al
260
Page.
Rood v. Whorton
123
Root v. Erdelineyer
286
Rose v. Winnsboro National Bank
169
Rosenblatt v. Johnston
182,281
Ruffin v. Board of Commissioners
135,275
Ruggles v. Kuler
236
Rush v. F i r s t National Bank, Kansas
City
213
S.
St. Albans, In r e First National Bank of.
106
St. Louis a n d San Francisco Railway
Company v. Johnston
142,184,255
St. Louis National Bank v. Allen e t a l . 196
St. Louis National Bank v. Bloch
_
134
St. Louis National Bank v. B r i n k m a n . .
197
St. Louis National Bank v. Papin
276
St. Paul, Merchants' National Bank of,
v. Hanson
.,
_
317
Safford v. First National Bank
116
Salisbury v. F i r s t National Bank
169.216
San Diego County v, California National
Bank
250,251,254
San Diego, I n r e Certain Shareholders
of t h e California National Bank of...
Ill
Sandy Hill, First National Bank of, v.
Fancher
284
San Fancisco, Nevada Bank of, v. Portland National Bank
202
Sanger v. Upton
_
125
Savary v. Savary
236
SaylesuCox
186
Scammon v. Kimball
836
Schierenberg v. Stephens
_
182
School District v. First National Bank.
158
Schrader v. Manufacturers' National
Bank of Chicago
178
Schuyler National Bank v. Bollong
305,306
Scofield v. State National Bank of Lincoln
212
Scott V.Armstrong
236,237,239,261
Scott, Plaintiff in Error, v. National
Bank of Chester Valley
_
201=
Scott et al. v. Pequonnock National
Bank
297
Scovill v. Thayer
125
Seattle National Bank v. City of
Seattle
282
Seattle, Puget Sound National Bank of,
v. King County et al
277,282
Second National Bank v. Dunn
214
Second National Bank v. Hewitt
2\ 4
Second National Bank v. Hughes et al.
121
Second National Bank v. Sproat
137
Second National Bank v. Wentzel
175
Security National Bank v. National.
Bank of the Commonwealth
100
Seeber v. Commercial National Bank of
Ogden
177,227
Seeley v. New York National Exchange
Bank
125
Seligman v. Charlottesville National
Bank
98
Selma, City National Bank of, v. Burns.
131
Selma, First National Bank of, v. Colby. 98,117
Shafer v. First National Bank
306
Sharpe v. National Bank of Birmingham
136
Sheffield et al., First National Bank of,
v. Tompkins
201,221
Shenandoah National Bank v. Read. 181,246,302
Shinkle v. The First National Bank of
Ripley
310
Shoemaker v. The National Mechanics'
Bank
ia5,207
Short etal.t>. Hepburn
98,101,170,194
Showalter v. Cox
_
134
Shunk v. The First National Bank of
Galion
303
Shute v. Pacific National Bank
238
SickelsuHerold
240
Simmons v. Aldrich
284
Simmons v. United States
155
Simons et al. v. Fisher
233
Simons v. First National Bank of Union
Springs
259
Sioux City, First National Bank of, v.
Peavey
122,194,245
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Page.
Sioux Valley State Bank v. Drovers'
National Bank
133
Skiles V.Houston
337
Sleppy v. Bank of Commerce et al
127
Smith v. First National Bank... 208,243,870,308
Smiths. Sabin
105
Smith v. The Exchange Bank of Pittsburg
301,304
Smithson v. Hubbell et al.
198
Snohomish County v. Puget Sound
National Bank
199
Snyder v. Foster
300
Snyder v. Mount Sterling National
Bank
309
Snyder's Sons Company v. Armstrong.
238
Somerville,City of, v.Beal
143,144,255
Southwick v. The First National Bank
of Memphis
117
Sowles v. Witters et al
110,163,189,199
Spafford v. The First National Bank of
TamaCity
210
Spokane, City of, v. First National Bank
257
Spokane County v. Clark
250
Spokane County v. First National Bank
257
Spokane, Exchange National Bank of, v.
Bank of Little Rock
176
Spring City, National Bank of, v. National Bank of Pottsto wn
205
Springfield, City of, v. First National
IJankof Springfield
290
Squires v. First National Bank
102,227
Stafford National Bank v. Dover
275
Stanley v. Board of Supervisors of the
County of Albany
196,291
Stantonv.Wilkeson
111,261
States. Bardwell
159
State v. Carpenter
209
Statev. Eifert
153
S t a t e s Fields
152
States. Gasting
135
State National Bank v. Flathers
260
State v. The National Bank of Baltimore
.—
284
State, North Ward National Bank,
pros., v. Newark
291
State National Bank v. Newton National Bank
226
State v. Sattley
152
State v. Smith
153
State v Teahan
153
State v. Tuller
151
S t a t e s Wells
154
Staunton v. Wilkeson
100
Steckel v. First National Bank of Allentown
273
Stephens v. Bernays
148,193
Stephens v. Follett
.+
110
Stephens v. Monongahela National
Bank
173,304
Stephens v. Overstolz
173,230
Stephens v. Schuchmann
242
Stetson v. City of Bangor
147,278,284
Stevens v. Catlin
219
Stewart v. Armstrong
163,184
Stewart v. National Union Bank of
Maryland
,
207,208
Stowev. Yarwood
236
Strong v. Southworth et al
106,108
Stuart v. Hayden et al
113,245,299
Sturdivant v. Memphis National Bank. 217,309
Sturgis National Bank v. Smyth
213
Sturgis, The First National Bank of, v.
Bennettetal
233
Sumter County v. National Bank of
Gainesville
1
292
Sunman v. Gatch et al
248
Supervisors v. Stanley
280
Swopev Lefllngwell
259
Sykes v. Holloway et al
300
T.
Tabor v. Commercial National Bank
105
Tacoma, Washington National Bank of,
v.Eckels
208
Talbot v. Silverbow County, Montana. 274,279
Talcott v. First National Bank
242
Talmage v. Third National Bank
191,205
Tapley v. Martin
119,166
95
Pago.
Tappan v. Merchants' National Bank
280
Taylor v. Hutton
224,234
Taylor v. National Bank
125
Tecumseh, First National Bank of, v.
Overman
305
Tecumseh National Bank v. Harmon.. _
246
Tehan v. First National Bank et al.
193
Tennessee et al., State of, v. Bank of
Commerce et al
278
Terry v. Birmingham National Bank..
135
Texarkana National Bank v. Daniel
205
Thatcher v. West River National Bank.
166
Thayer v.Butler
105,124,267
Third National Bank v. Angell
217
Third National Bank v.Blake
210,243
Third National Bank v. City of Louisville
282
Third National Bank v. Harrison et al..
221
Third National Bank v. Hastings
219
Third National Bank, In re
262
Third National Bank v. Merchants' NationalBank
174
Third National Bank v. Stillwater Gas
Company
162
Thomas v. City National Bank
233,244
Thomas v. Farmers' Bank of Maryland. 149,150
Thomson v.Beal
126
Thompson National Bank v. Dow
211
Thompson v. German Insurance Company et al
114,115
Thompson v. Pool
194,265
Thompson v. St. Nicholas National Bank 127,301
Thompson v. Sioux Falls National Bank.
129
Thornton v. National Exchange Bank.. 136,259
Thurber v. Miller
194
Ticonic National Bank v. Bagley
246
Tiffany v. National Bank of the State of
Missouri
189
Timberlake et al. v. First National Bank.
190
Titusville, Appeal of Second National
Bank of
310,312
Toledo, Merchants' National Bank of,
v. Cumining
287,288
Tompkins County National Bank v.
Bunnell and Eno Investment Company
214
Tootle et al. v. First National Bank of
Port Angeles
302
Townsend v. Williams
159
Tradesmen's National Bank v. Bank of
Commerce
99,208
Tradesmen National Bank, People ex
rel., v. Commissioners of Taxes and
Assessments
286
Trenholm, Comptroller, v. Commercial
National Bank
173
Trent Title Company v. Fort Dearborn
National Bank of Chicago
202
Trustees of First Presbyterian Church
v. National State Bank
170,243
Turner v. First National Bank of Keokuketal
260
Turner v. First National Bank of Madison
,
259
Turner v. Uni on National Bank
102
Turner v. Utah Title Insurance and
Trust Company
102
Turner v. Wells, Fargo & Co
102
Tuttle v. Frelinghuysen
252
Twin CityBank v. Nebeker
294
Tyson v. Western National Bank of Baltimore
139
U.
Ulrich v. Santa Rosa National Bank.... 102,105
Ulster County Savings Institution v.
Fourth National Bank
192
Underwood v. Metropolitan National
Bank
212
Union Gold Hill Mining Company v.
Rocky Mountain National Bank
209
Union Mills First National Bank v.
Clark....
131
Union National Bank v City of Chicago.
295
Union National Bank v. City of Cleveland
205
Union National Bank v. Grant
218
Union National Bank v. Henry Dreyfus.
241
96
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Page.
Union National Bank v. L., N. A. and C.
R.Company
_
304
Union National Bank v. Oceana CountyBank
130
Union Stock Yards National Bank v.
Dumond
201
Union Stock Yards National Bank v.
Moore etal
16x,247
Uniontown, First National Bank of, v.
Stauffer...
306
United States v. Allen
171
United States v. Allis
152,173
United States v. American Exchange
NationalBank
145,174
United States, ex rel., v. Barry
312
United States v. Bennett
134
United States v. Booker
155
United States v. Britton
150,151,180
United States v. Cad wallader
151
United States v. Clinton National Bank.
175
United States v. Conant
151
United States v. Cooke County National
Bank
148
United States v. Crecelius
171
United States v. Curtis
180,220,224
United States v. Edgerton
180
United States v. Ege
171
United States v. Eno
179
United States v. Pish
150,151,171
United States v. Folsom
172
United States v. French et al
171,180
United States v. Graves
171,172,266
United States v. Harper
150,151,171,229
United States v. Hughitt
171
United States v. Knox
106
United States v. Lee
155
United States, Plaintiff in Error, v.
Mann
293
United States v. Means et al
225,330
United States v. Neale
228
United States v. National Bank of Ashevilleetal
159
United States v. National Exchange
Bank
194
United States v. Northway
179
United States v. Patterson, Keeper, etc.
156
United States v. Potter
155,178,179
United States v. Stockgrowers' National
Bank of Pueblo
161
United States v. Taintor
150
United States v. Vorhees
148
United States v. Warner
178
United States Bung Manufacturing
Company v. Armstrong
239
United States National Bank v. First
National Bank of Little Rock e t a l . . . . 222,235
United States National Bank v. McNair.
212
Upton v. National Bank of South Reading
259
Upton v. Tribilcock
125
Utica, First National Bank of, v. Waters
and another
289
V.
Valparaiso, Ind., The Farmers' National
Bank of, v. Sutton Manufacturing
Company
148
Van Allen v. The American National
Bank
130,158
Van Allen v. The Assessors
274,275,279
Van Antwerp v. Hulburd
183,195
Van Campen, In re
171
Vance v.Mottley
....
226
Van Leuven v. First National Bank
244
Van Slyke v. State
275
Veazie Bank v. Fenno
135,147,278,280
Veederv. Mudgett
125
Venango National Bank v. Taylor.. 236,237,238
Vennerv.Cox
250
Vicksburg Bank v. Worrell
275
Viets v. The Union National Bank of
Troy
130
Vilas National Bankv. Barnard
99
Virginia, National Bank of, v. City of
Richmond e t a l
274
Voseu.Philbrook
236
W.
Page.
Wachusett National Bank v. Sioux City
Stove Works
193
Wadsworth v. Duncan
101
Wadsworth v. Hocking
101
Wadsworth v. Laurie
101
W a i t v . Dowley
280
Walker v. Miller
167
Walker e t al. v. Windsor National
Bank
192
Wallaces. Stone
145
Warren v. De Witt County National
Bank
259
Warren v. First National Bank
305
Washington National Bank v. Eckels..
363
Washington National Bank v. City of
Seattle
383
Washington National Bank v. King
County
283
Washington National Bank v. Pierce...
323
Wasson v. Bank
276
W a s s o n u Hawkins
25b
Waterloo, First National Bank of, v.
Elmore
259
Waterloo Milling Company v. Kuenster
145
Watkins v. National Bank of Lawrence
208
Watson v. Sheafe
159
Waxahachie National Bank v. Vickery
201
Weber v. Spokane National Bank
208
Weber e t al. v. Spokane National Bank
208
Weckler v. The First National Bank of
Hagerstown
302
Welles v. Graves
173,230
Welles v. Larrabee
109
Welles v. Stout
110
Wellsburg, The First National Bank of,
v. Kimberlands
234
Wellston, First National Bank of, v.
Armstrong
141,244
West u Bank of Rutland
135
West v. St. Paul National Bank
139
Western National Bank v. Armstrong.. 224,236
Western National Bank v. Wood
217
Westervelt v. Mohrenstecher et al
227
Weston v. Estey
203
West Side Bank v. Mechanics 1 National
Bank of Newark, N. J
117
W h a r r y v.Hale
360
Wheeler v. Union National Bank of
Pittsburg
308
Wheeler v. Walton & Whann Company.
264
Wheelock v. Kost
267
Whitbeck v. Mercantile Bank
277,279
White v. Knox
182,183
White et al. v. Iowa National Bank of
DesMoines
104
Whitehall, First National Bank of, Respondent, v. James Lamb e t al., appellants
_
312
Whitney v. Butler
296
Whitney v. The First National Bank of
Brattleboro
270
Whitney et al. v. General Electric Company of New York et al
264
Whitney National Bank v. Parker
277
Whitney e t al., Appellants, v. Ragsdale,
Treasurer
285
Whittaker v. Amwell National Bank . . 103,138
Whittemore v. Amoskeag National
Bank
191
Wichita National Bank et al. v. Smith.
194
WickhamuHull
106,193
Wild, I n r e .
190,306
Wilder v. Union National Bank
197
Wiley v. The First National Bank of
Brattleboro
270
Williams, People ex rel., v. Weaver
276
Williams v. Board of Supervisors of t h e
County of Albany
_
290
Williams v. City National Bank
_
231
Williams v. Cox
134
Williams v. Weaver
276
Williamsport National Bank v. Knapp. 169,196
Wilmington, First National Bank or, v.
Herbert, State Treasurer
294
Wilson, Assignee, v. National Bank of
Rolla...
307
Wilson u P a u l y
105,233
REPORT OP THE COMPTROLLER OF THE CURRENCY.
Page.
Wingate v. Orchard
340
Winstandley v. Second National Bank..
186
Winter v. Baldwin
131
Winters v. Armstrong
133,263
Winters v. Wood
363
Winterset, National Bank of, v. Eyre
etal
191,336,311
Winton v. Little
360
Witters V.Foster
101,183,328
Witters v. Bowles.... 106,148,188,310,339,339,371
Wolverton v. Exchange National Bank.
191
Wood River Bank v. First National Bank
of Omaha...
133,134,139,303
Woods v. Peoples' National Bank of
Pittsburg
313
Woodward V.Ellsworth
381,391
Woolman v. Capita] National Bank
341
Worcester National Bank v. Cheeney . .
359
Worcester, Mass., First National Bank
of, v. Lock-Stitch Fence Company et al.
317
Wright v. First National Bank of
Greensburg
304
Wright v. Merchants' National Bank...
361
Wright v.Robinson e t a l
133
Wylie v. Northampton National Bank..
370,
373,373,301
H. Doc. 30
7
97
Page.
Wyman v. Citizens' National Bank of
Faribault
30&
X.
Xenia, First National Bank of, v. Stewart
133,135,335
Y.
Yakima National Bank v. Knipe
166,181
Yardley v. Clothier
336,338
Yardley i. Philler
358
Yardley v. Wilgus
111,367
Yerkes v. National Bank of Port Jervis.
344
Youngv. Andrews e t a l
148,344,360
Young v. McKay
Ill
Young v. Wenrpeetal
110,163
Youngstown, First National Bank of, v.
Hughes e t a l
131,378,389
Z.
Zeiglerv. First National Bank of Allentown
161
98
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ABATEMENT:
1. An action brought by the creditor of a national bank is abated by a decree
of a district or circuit court dissolving the corporation and forfeiting its
franchises. First National Bank of Selma v. Colby, 21 Wall., 609.
2. A creditor's bill was filed against a national bank before the passage of the
act of Congress of June 30,1876 (19 St. at L., 63), and a receiver was
appointed, who took possession of the property of the bank. An amended
bill was filed in the cause, after the passage of that act, to secure the
benefits of the act, to which all the stockholders were made parties.
Subsequently the Comptroller of the Currency appointed a receiver to
wind up the affairs of the bank, and this suit was brought by him against
one of the stockholders. Held, on demurrer to a plea in abatement, which
set forth these facts, that the defendant is entitled to judgment on the
ground that as the stockholders' liability can be completely enforced in
the suit in equity, the general rule applies that a debtor shall not be vexed
by two suits in the same jurisdiction for the same cause of action.
Harvey, Receiver, etc., v. Lord, 10 Fed. Rep., 236.
3. The pendency of a suit in a State court is not necessarily a bar to a suit in
a Federal court between the same parties, involving the same issues.
Short et ah v. Hepburn, 75 Fed. Rep., 113.
4. In an action by a creditor of a corporation against a stockholder to enforce
his statutory liability, an affidavit for attachment stating that the action
is to enforce the stockholders' liability under the constitution and statutes for payment of the debts of the corporation and that the claim
against defendant is his liability as such stockholder, sufficiently states
the "nature of plaintiff's claim." Rev. St.. sec. 5522; Northern Nat.
Bank v. Maumee Rolling Mill Co. {Com. PL), 2 Ohio N. P., 260.
ACCOMMODATION PAPER:
1. A national banking association can not guarantee the paper of a customer
for his accommodation. Scligman v. .CharlottesviUe National Ba?ik, 3
'Hughes, 647.
2. The accommodation paper of a national banking association is void in the
hands of one who takes it with knowledge of its character. Johnston v.
Charlottesville National Bank, 3 Hughes. 657.
3. A national bank can not become an accommodation indorser. National
Bank of Commerce v. Atkinson, 55 Fed. Rep., 465.
4. A private corporation can not defend an action on its accommodation note
on the ground of ultra vires, as against a bona fide holder. Florence
Railroad and Improvement Company v. Chase National Bank (Ala.), 17
So., 720.
5. As against a holder for value, a maker of an accommodation note can
defend only on the ground of actual payment. Philler v. Patterson (Pa.
Sup.), 32 A., 26.
6. A director and stockholder of a national bank gave an accommodation note
to the bank's president, on the latter\s request and representation that
the note was to be put in the hands of his personal creditor as security,
and on condition that no money should be drawn on the note, and that
the note should not be put in the bank. Without the knowledge of the
maker, he being aged and infirm of sight, the note was made payable to
the bank and placed therein, and a certificate of deposit for the amount
thereof issued to the president, and by him deposited with his creditor,
who held the same until the bank's failure. Held, that the maker was
liable on the note to the bank's receiver. Linn County National Bank
V. Crawford (C. C), 60 Fed. Rep., 532.
7. Complainants, on the request of a national bank needing funds, signed an
accommodation note for $10,000, payable to its order, with the understanding that it would discount the same, and use the proceeds in its
business. The bank at the same time agreed to place to the credit of
complainants on its books an amount equal to the proceeds of the note,
complainants stipulating that they would not check against this credit
except to pay the note or to reimburse themselves for paying it. The
credit was accordingly made, and the bank, after continuing business
for some time, failed, and complainants were compelled to pay the note.
They thereafter recovered a judgment at law against the bank's receiver
for the amount paid to take up the note, and then sued in equity for the
amount placed to their credit, according to the agreement. Held, that
they are not entitled to two judgments for the same debt and to divi-
REPORT OF THE COMPTROLLER OF THE CURRENCY.
99
ACCOMMODATION PAPER—Continued.
(lends on both judgments until one of them was satisfied, and that the bill
must therefore be dismissed. Latimer v. Wood et al., 73 Fed. Mep., 1001.
8. When the payee of an accommodation check, given for a particular purpose, deposits it in a bank in his own name and the bank makes advances
and extends credit on the faith of the deposit without notice of the trust,
its rights and equities are superior to the drawer of the check. Erisman
Y.Delaware County Nat. Bank, 1 Pa. Super. Ct., 144, 37 W. N. C.,518.
9. In an action on a note, it appeared that plaintiff bank discounted P. & Co. *s
paper to the full extent, consistent with its rules, and, in reply to an application for a further discount, suggested that the company get defendant
bank to discount the paper and allow plaintiff to rediscount it-. The
company made its note to defendant, who indorsed it, and sent it on to
plaintiff, with whom it had an account, and the proceeds were placed to
defendant's credit. Defendant placed the amount of the note to the
credit of P. & Co., by whom it was at once checked out. This specific
amount credited to defendant by plaintiff was not checked out by
defendant, but checks in various amounts, in ordinary course of business, were drawn against its account, none of which apparently had any
special reference to the amount of the discount. Held, that defendant
was not an accommodation indorser. Fox v.Home Co. {Sup.),35 N. Y.
S., 896, distinguished. Tradesmen's Nat. Bank v. Bank of Commerce
(Sup. )i39N. F. 8., 554.
10. Where a note was signed by accommodation makers, and made payable to
a bank, on the understanding that it was to be deposited in the 'bank to
secure a loan for the purchase of wheat for a mill, with the ultimate
intention of paying off a mortgage on the mill, and such makers, without notice to the bank of any restrictions on the disposition of the note,
allowed the mortgagor, for whose benefit it was made, to have possession and control thereof, they can not complain that he effected an
immediate payment of the mortgage by procuring an indorsement to
himself from the bank, and then indorsing the note to the mortgagee.
First Nat. Bank v. Wood {Tex. Civ. App.), 28 S. W., 384.
11. An answer which alleges that the note sued on was accommodation paper,
and was made and delivered on condition that defendants should not be
held liable thareon, provided there was delivered to plaintiff good business paper of the person accommodated, is insufficient, because it does
not allege that the agreement to replace such note with other paper was
made with plaintiff. Vilas Nat Bank v. Barnard (Sup.), 28 N. Y. S., 9,12.
12. Defendant, for the accommodation of the maker, indorsed blank notes in
the following form: "
after date,
promise to pay to the
order of —'•—-, at the Farmers' National Bank, Adams, N. Y. Value
received." Held, that the delivery of the indorsed blanks did not
authorize the holder to fill them out so as to make them payable "on
demand" instead of at a specified time after date, or to add the words
'' with interest." Farmers' Nat. Bank v. Thomas (Sup.), 29 N. Y. S., 837.
13. An accommodation indorser on a note given in renewal of a note on which
he was also accommodation indorser, at its maturity, is not relieved of
liability because of his insanity at time of signing it, the bank taking it
in renewal having no notice of his insanity, and he having been sane
when the prior note was executed. Memphis Nat. Bank v. Sneed (Tenn.
Sup.), 33 S. W., 716.
14. Accommodation paper is put into circulation for the purpose of giving
credit to the party for whose benefit it is intended, and, although he
can not maintain an action upon it against the accommodation maker
or indorser, a purchaser can do so, who acquires it while still current,
and gives the credit it was intended to promote, although with knowledge of its original character. Israel v. Gale, 77 Fed. Rep., 532.
15. One who takes accommodation paper from the party for whose benefit it
was made and gives him credit for the same on a precedent indebtedness, though advancing no money, is a holder of such paper for
value. Ib.
ACTIONS: See Jurisdiction.
1. A national banking association is a foreign corporation within the meaning of a State statute requiring corporations created by the laws of any
other State or country to give security for costs before prosecuting a suit
in the courts of the State. National Park Bank v. Gunst, 1 Abb. N. C.. 292.
100
REPORT OF THE COMPTROLLER OP THE CURRENCY.
See Jurisdiction—Continued.
2. As a national banking association can acquire no title to negotiable paper
purchased by it, it can maintain no action thereon in a State where the
person suing must be owner of the paper. First National Bank of
Rochester v. Pierson, 24 Minn., 140.
3. A stockholder in a national bank can not maintain an action at law against
the officers and directors thereof to recover damages for willful waste of
the assets whereby the value of his shares was decreased and he became
liable to an assessment thereon. His remedy must be sought in equity.
Hirsh y. Jones et ah, 56 Fed, Rep,, 137.
4. The provision of the banking law, section 5198, Rev. Stat., which requires
that actions brought against national banking associations in State
courts shall be brought in the county or city in which the association is
located, applies only to transitory actions. It was not intended to apply
to actions local in their character. Casey v. Adams, 102 U. S., 66.
5. Under section 57 of act of 1864, suits may be brought by, as well as against,
any association. Kennedy v. Gibson, 8 Wall., 498.
6. Actions local in their nature may be maintained in the proper State court
in a county or city other than that where it is established. Casey v.
Adams, 102 U. S., 66.
7. A national bank may be sued in any State, county, or municipal court in
county or city where located. Bank of Bethel v. Pahquioque Bank, 14
Wall, 383,
8. Under the original act respecting national banks, and before the act of June
30, 1876, a court of equity had jurisdiction of suit to prevent or redress
maladministration or fraud against creditors, in voluntary liquidation of
such bank, whether contemplated or executed; and such suit by one
creditor must be for all. Richmond v. Irons, 121 U. S., 27.
9. Suit may be brought against a national banking association though it is in
the hands of a receiver. Bank of Bethel v. Pahquioque Bank. 14 Wall.,
383; Security National Bank v. National Bank of the Commonwealth, 2
Hun.,287; Green v. The Wallkill National Bank, 7 Hun., 63.
10. A shareholder of a national banking association can not maintain an action
against the directors to recover damages sustained for neglect and mismanagement of the affairs of the association whereby it became insolvent and its stock was rendered worthless. Such an action can be
brought only by the corporation itself. Conway v. Halsey, 15 Vroom.,
462; Howe v. Barney, 45 Fed. Rep., 668.
11. But where the receiver refuses to bring an action against negligent directors to racover the amount which the shareholders have been compelled
to contribute to pay the debts of the association, an action against such
directors may be brought by a shareholder on behalf of himself and the
other shareholders. Nelson v. Burroughs, 9 Abb. N. C, 280.
12. And when the receiver is a director and one of the parties charged with
misconduct and against whom a remedy is sought, the action may be
brought by a shareholder on behalf of himself and the other shareholders. Brinckerhoffv. Bostivick, 88 N. Y.,52.
13. A receiver may sue either in his own name or the name of the bank.
National Bank y. Kennedy, 17 Wall., 19.
14. Suits and proceedings under the act in which the United States or their
officers or agents are parties, whether commenced before or after the
appointment of a receiver, are to be conducted by the district attorney,
under the direction of the Solicitor oi the Treasury. Bank of BetJiel v.
Pahquioque Bank, 14 Wall., 383.
15. But section 380, Rev. St., is directory merely, and the employment of private counsel by the receiver can not be made a ground of defense to a
suit brought by him. Ib.
16. Receivers may sue in the courts of the United States by virtue of the act,
without reference to the locality of their personal citizenship. Ib.
17. The provisions of the codes that every action must be brought in the name
of the real party in interest, except in the case of the tri? tee of an express
trust or of a person authorized by a statute to sue, does not apply to the
receiver of a national banking association suing in a Federal court held
in a State which has adopted the code procedure; for the right of the
receiver to sue is derived from the national banking law. Staunton
v. Wilkeson, 8 Ben., 357.
18. Under section 1001, Rev. St., no bond for the prosecution of the suit, or to
answer in damages or costs, is required on writs of error or appeals
ACTIONS:
REPORT OF THE COMPTROLLER OF THE CURRENCY.
101
ACTIONS: See Jurisdiction—Continued.
issuing from or brought to the Supreme Court of the United States by
direction of the Comptroller of the Currency in suits by or against
insolvent national banking associations or the receivers thereof. Pacific
National Bank v. Mixter, 114 U. S., 4-63.
19. The State statute of limitations applies to a suit brought by the receiver of
a national bank against a shareholder to recover an assessment upon his
stock to pay the debts of the bank. Butler v. Poole, 44 Fed. Rep., 586.
20. Whether a suit against a director for negligent performance of his duties,
as required by the statutes of the United States and the by-laws of the
association, will survive against the executor or administrator depends
upon State laws. Witters v. Foster, 26 Fed. Rep., 737.
21. Such action is not prescribed by the limitation of one year in Louisiana.
Case v. Bank, 100 U. S., 446.
22. On a bill filed by receiver against stockholders under section 50, where bank
fails to pay its notes, action by Comptroller must precede institution of
suit by receiver, and be set forth therein. Kennedy v. Gibson, 8 Wall., 498.
23. Creditors of the bank are not proper parties to such bill. Ib.
24. A compromise of a suit by the receiver of a national bank and counsel for
the United States will not be opened after a delay of seven years, no
frau<l being shown. Henderson v. Myers, 11 Phila., 616; 3 N. B. C., 759.
25. An action may be brought against a national bank, notwithstanding a
receiver of it has been appointed. Security Bank of New York v. National
Bank of the Commonwealth, 4 Thompson & Cook, 518; 1 N. B. C.,774.
Green v. The Wallkill National Bank, 7 Hun., 63; 1 N. B. C, 786.
26. An action against the directors of a national bank under the provisions of
Rev. St., § 5239, can be maintained only by a receiver of the bank; and
an action by a private individual against such directors for damages
arising from the making of false reports or other violations of the national
banking act can only be maintained as an action at the common law in
the nature of an action of deceit. Gerner v. Thompson, 74 Fed. Rep., 125.
27* An action can not be maintained against a bank by the holder of a check
fOT
refusal to pay it, unless the check has been accepted, although there
?4ands to the credit of the drawer on the books of the bank a sum more
\ nan sufficient to meet the check. Cincinnati, H. & I). R. Co. v. Metropolitan Nat. Bank (Ohio Sup.), 42 N. E., 700.
28. A bill by the receiver of an insolvent national bank against the shareholders to recover dividends unlawfully paid out of the capital at times
when the bank had earned no net profits may be brought without an
express order from the Comptroller of the Currency. Hayden v. Thompson (C.C.A.), 71 F., 60.
29. Where both parties to an action claim title to land under legal proceedings, those through which defendant derives title being alleged to be
fraudulent, it is reversible error to instruct the jury that, upon the
record evidence, the title is vested in the plaintiff, whereas in fact the
defendant has the better title, unless it is defeated by fraud. Short et
al. v. Hepburn, 75 Fed. Rep., 113.
30. In an action involving the validity of a title claimed by defendant to have
been acquired under attachment and execution against one C , while
plaintiff charges that C. was a fictitious person, and the deed to him and
the proceedings against him were parts of a scheme of his supposed
grantor to defraud his creditors, it is error to charge the jury either
that, if C.'s whereabouts were unknown, it would make his title to the
property immaterial, or that the fact that C. was a fictitious person
would entitle the plaintiff to recover, irrespective of the circumstances
under which defendant acquired his title. Ib.
31. In an action by a depositor in an insolvent bank against the stockholders
to recover the balance due him at the time of the suspension of the bank,
it is not necessary to join as defendants persons who signed the articles
of incorporation, but have since transferred their stock, though such
transfer was not made in the manner provided by the articles of incorporation. Wadsworthv. Hocking, 61 HI. App., 156; Same v. Duncan,
Id.; Same Y.Laurie, Id.
32. Where a person holds stock in a banking association as trustee, he is a
proper party defendant, to the exclusion of his beneficiary, in an action
brought by a depositor against the stockholders to recover the balance
due him at the time of the suspension of the bank. Ib.
33. An instrument headed by the name of a bank and a list of its officers,
102
EEPORT OF THE COMPTROLLER OF THE CURRENCY.
ACTIONS: See Jurisdiction—Continued.
reciting that plaintiff had left a sum of money to be loaned for his use,
"payable not to exceed six months, on return of this memorandum."
and signed with the name of the person represented at the top of the
paper to be the cashier, the signature being followed by a scroll composed of the letters "chr., r ' shows prima facie a cause of action against
the bank for a return of the money loaned. Squires v. First Nat. Bank,
59 III. App., 134.
34. An action ex contractu brought by an administrator to recover aaoney
claimed to have been wrongfully paid to defendant by a bank constitutes an election and ratification of the iDayment, and precludes a subsequent action against the bank on the same claim. Crook v. First Nat.
Bank(Wis.), 52 N. IF., 1131.
35. The assignment of a promissory note vests the legal title in the assignee
and renders him a proper party plaintiff in an action thereon. Forster
v. Second Nat. Bank, Gl III. App., 272.
36. In an action to recover the amount paid to the payee and indorser of a
check alleged to have been fraudulently altered as to amount, where
experienced cashiers were allowed to testify as experts for defendant to
the genuineness of the check, and chemical experts had testified for
plaintiff that writing could be removed by the use of acids without any
trace being left, plaintiff should have been allowed to cross-examine
defendant's expert witnesses as to their knowledge of the use and effect
of acids in removing ink. Birmingham Nat. Bank v. Bradley (Ala.), 19
So., 791.
37. A complaint in an action on a note alleged its execution, and in a third
paragraph alleged that " n o part of said sum has been paid,.and the
same is wholly due;" and the answer admitted the execution of the note,
but denied " each and every allegation in paragraph three." Held, that
the denial was bad, as a negative pregnant. Columbia Nat. Bank v. Western Iron & Steel Co. (Wash.), 44 P., U5.
38. In an action by the assignee of an invalid, nonnegotiable instrument,
against the assignor thereof, plaintiff must show that the maker was
insolvent when the instrument was made or became due, or that he used
diligence to recover from the maker, and failed, or that suit against the
maker would have been of no avail. Merchants' Nat. Bank v. Sixties
(IF. Va.), S3 S. E., 681.
39. In an action against the receiver of an insolvent corporation, the facts
that he represents the corporation and produces its books of account do
not prevent him from contradicting the entries therein, as he represents
creditors also. Whittaker v. Amrcell Nat. Bank (N. J. Ch.),29 A., 203.
40. In an action to recover on certificates of deposit alleged to have been
assigned plaintiff by deceased, where the complaint alleges and the
assignment recites a consideration of $1,000, and the assignment is
attacked as fraudulent, testimony that deceased said she intended p]aintiff to have all her property when she died is incompetent. Turner v.
Utah Title Insurance & Trust Co. (Utah), 37 P., 91; Same v. Wells,
Fargo & Co., Id., 94; Same v. Union Nat. Bank, Id., 95.
41. In an action to recover money deposited by plaintiff with defendant under
an agreement that it is to be paid to a third person on condition that
the latter deliver a deed to plaintiff within a certain time, such person
is not a necessary party. Ullrich v. Santa Rosa Nat. Bank (Cal.), 37
P., 500.
42. By authority of the directors of a national bank in Chicago, which had
acquired some of its own stock, the individual note of its cashier, secured
by a pledge of that stock, was, through a broker in Portage, sold to a
bank there. The note not being paid at maturity, the Portage bank
sued the Chicago bank in assumpsit, declaring specially on the note,
which it alleged it was made by the bank in the cashier's name, and
also setting out the common counts. The bank set up that the purchase of its own stock was illegal, and that money borrowed to pay a
debt'contracted for that purpose was equally forbidden by Rev. Stat.,
section 5201. The trial court was requested by the Chicago bank to
rule several propositions of law, and declined to do so. Judgment was
then entered for the Portage bank. The supreme court of the State of
Illinois held that the Portage bank was entitled to recover under the
common counts, and that itwas not necessary to consider whether the
trial court had ruled correctly on the proposition of law submitted to
REPORT OF THE COMPTROLLER OF THE CURRENCY.
103
ACTIONS: See Jurisdiction—Continued.
43.
44.
45.
46.
47.
48.
49.
50.
it. Held, that that court, in rendering such judgment, denied no title,
right, privilege, or immunity specially set up or claimed under the laws
of the United States, and that the writ of error must be dismissed.
Chemical Bank v. City Bank of Portage, 646 Fed. Rep., 160.
No action maybe maintained against a national bank upon a contract
made by its cashier on its behalf to guarantee a contract between third
persons for delivery of building materials. Norton v. Derby National
'Bank, 61 N. H, 589; 60 Am. Rep., 334; 3 N. B. C, 568.
In an action by a receiver to recover an assessment on certain shares of a
national bank, defendant pleaded a prior judgment dismissing a bill
brought to charge her fathers estate with the same assessment, to which
suit she was also a party. ^ Held, that the causes of action were different, that in the earlier suit being the alleged ownership of the shares
by the father at the date of the bank's failure and that in the latter the
alleged ownership by the daughter of the same shares at the same date,
and that, therefore, the former suit operated as an estoppel only as to
the matters actually litigated and determined. Ricaud v. Tysen, 78
Fed. Rep., 561.
Where the causes of action are different, and the decree in a former suit
does not show on its face that the question involved in the present one
was directly and necessarily determined, evidence aliunde, consistent
with the record, may be received to show that it was actually determined. Ib.
An action by the receiver of an insolvent national bank, in which it is
alleged that the defendant, to which negotiable paper was sent by the
bank for collection, appropriated the proceeds thereof and refused to
pay the same over on demand, is an action for the conversion of chattels,
and is governed by the limitation fixed by subdivision 3 of section 338 of
the California Code of Civil Procedure relating to actions for " taking,
detaining, or injuring any goods or chattels." Hawkins v. State Loan
& Trust Co., 79 Fed, Rep., 50.
Where a note executed solely for the accommodation of a bank was made
payable to the order of the bank's cashier and indorsed in blank, the
mere fact that the president of the bank negotiated the note for his personal benefit to a third person, who knew his office, was not of itself
notice to the purchaser of the facts, or sufficient to put him on inquiry
as to the legality of the president's act. Kaiser v. United States Nat. Bank
(Ga.),25 S.E.,620.
In an action by a bank upon a negotiable note payable to order, the title to
which, by appropriate endorsement, has become vested in the name of a
person as cashier, the declaration must show that such person is plaintiff's
cashier, and that the ownership of the note sued upon is in plaintiff; else
it will be demurrable. Hobbs v. Chemical Nat. Bank (Ga.), 25 S. E., 34S.
A stockholder of an insolvent national bank may bring a suit in a State
court, in behalf of the bank and himself, as a representative stockholder,
against the directors, to recover money alleged to have been lost through
their negligence and breach of trust, when the bank's officers, the
receiver, and the Comptroller of the Currency have all refused to bring
such a suit. Ex parte Chetwood, 165 U. S., 443.
In an action by a national bank on railroad aid bonds the United States
alone can complain that the bank was not authorized to hold such bonds.
Toivn Council of Lexington v. Union Nat. Bank (3Iiss.), 22 So., 291.
AGENT OF SHAREHOLDERS:
1. The Federal courts have the same jurisdiction of suits by and against the
* * agents " of national banks appointed under the national banking acts
of Congress, when the "receivers " of an insolvent bank have been displaced by such "agents," as they have of suits by and against the
''receivers" of such banks, each being in the same sense officers of the
United Spates, and each representing in precisely the same relation the
bank in its corporate capacity; and this jurisdiction attaches without
regard to any diversity of citizenship of the parties or the amounts
involved. McConville v. Gilmour et al.t 36 Fed. Rep., 277.
2. When the receiver of an insolvent national bank has been displaced by nn
" agent" appointed under the acts of Congress in that behalf, it is proper
practice to substitute, upon motion, the " agent" as the plaintiff on the
record in place of the "receiver" in a suit already commenced by the
latter. Ib.
104
REPORT OF THE COMPTROLLER OF THE CURRENCY.
AGENT OF SHAREHOLDERS—Continued.
3. That a receiver of an insolvent national bank has applied to the proper
circuit court for authority to sell assets, and that thereafter an agent
has been appointed, under 19 Stat., 03, as amended by 27 Stat.. 345, to
succeed the receiver, gives that cotirfc no authority to enjoin a stockholder in the bank from prosecuting actions in the State courts, in behalf
of the bank, against its directors, or against using the bank's name in
writs of error sued out from the United States Supreme Court to review
the judgments of the State supreme court in such actions. Exparte
Chetwood, 165 U, S., 443.
4, A duly elected "agent," who is substituted under the act of June 30, 1876
(19 Stat., 63), as amended by the act of August 3, 1892 (27 Stat., 345),
for the receiver of an insolvent national bank, to complete the winding
up of its affairs, proceeds with like authority to that of the receiver,
and is not an officer of the circuit court, though he is required by the
statute to render an account to it of all his proceedings, expenditures,
etc., and he and his sureties are finally discharged by its order. Ib.
5. Where an action brought by a stockholder in a national bank, in behalf of
the corporation while in the hands of a receiver, has terminated, an
agent of the corporation elected to succeed the receiver as provided by
law, and charged with the duty of controlling and disposing of its assets
and of distributing the proceeds, is entitled to receive the proceeds of
such action, less a reasonable allowance to the plaintiff for his costs,
disbursements, and attorney's fees. Chetwood v. California Nat. Bank
(Cal.),45 P.,854.
6, 27 Stat., 345, c. 360, § 3, authorizes the election of an agent by the stockholders of a national bank in the hands of a receiver when all indebtedness to outside creditors has been paid, and provides that such agent,
after giving bond, shall be vested with the control of the bank's affairs
by the controller and receiver, being accountable to the circuit or district court of the United States. Held, that such agent takes the place
of the receiver, and is at least a quasi public officer, the regularity and
validity of whose appointment can not be questioned in a collateral proceeding. Ib.
APPEAL:
1. Under act March 3,1891, § 11, a writ of error must be sued out within six
months in order to authorize a review by the circuit court of appeals.
White et al. v. Ioica Nat. Bank of Des Moines, 71 Fed. Rep., 97.
2. Under the Louisiana Code of Practice providing (articles 364,391) that third
persons may intervene in suits, either before or after issue, provided the
intervention do not retard the suit, but that persons so intervening must
be always ready to plead or exhibit their testimony, an appellate court
can not review the exercise of discretion by the trial court in refusing
an application by such an intervener, made after the commencement of
a trial, for a continuance, in order to enable the intervener to take steps
necessary to bring his intervention to an issue. It is not error to refuse
to admit evidence offered by such an intervener, when his intervention
has not been brought to an issue with the original parties. Baker v.
Texarkana Nat. Bank et al., 74 Fed, Rep., 597.
3. On an appeal from an order denying a motion to dissolve an injunction
pendente lite, restraining an execution sale of personal property, held,
that the court of appeals could not determine questions of law which
might depend upon undisclosed facts, or questions of fact upon ex parte
affidavits of the character of those presented in the record; and that, as
the questions arising were proper subjects for deliberate examination,
the order would be affirmed under the rule that, where a stay of proceedings will not cause too great injury to defendants, it is proper to
preserve the existing state of things until the rights of the parties can
be fully investigated. Hodden et al. v. Dooley et ah, 74 Fed. Rep., 4#9.
4. Where an order refusing to dissolve an injunction pendente lite restraining
a sheriff from selling certain silks on execution was affirmed, but it
appeared to the court that a sale of the goods would be to the pecuniary
advantage of both parties, held, that leave would be reserved to the court
below to modify its order so that by consent of the parties the silk
might be sold under the execution, after ample notice, and the proceeds
placed in the registry to await a final decision. Ib.
5. It is not indispensable that an exception to a ruling of the court on the
trial of an action should be brought before an appellate court by a bill
REPORT OF THE COMPTROLLER OF THE CURRENCY.
105
APPHAli—Continued.
of exceptions if it fully appears upon the record proper. Wilson v.
Pauly, 72 Fed. Rep., 129.
0. The only question presented being ono of fact, as to which the evidence
is conflicting and apparently evenly balanced, the finding and judgment
of the district court should not be disturbed. Buffalo County Nat. Ba n k
V. Gilcrest (Neb.), 66 N. W., 850.
7. Where the bill of exceptions purporting to contain the evidence in a case
is not authenticated by the certificate of. the clerk of the trial court it
will not be examined. First Nat. Bank v. Cass County (Neb.), 06 N. W.,
300.
8. As each party may appeal from the same final judgment without making
separate cases of each appeal, the appellate court may consolidate into
one proceeding separate cases on appeal from the same judgment.
Farmers & Merchants9 Nat. Bank v. Waco Electric Railway & Light
Co. (Tex. Sup.), 34 S. W., 737.
9. An order requiring an answer to be made more definite, so as to show what
is pleaded as defense and what as counterclaim, rests in discretion, and
is not appedable. Garfield Nat. Bank v. Kirchway (City Ct. N. Y.),
37 N.Y~S.,1140,
10. Where the ::ec:rd fails to show that notice of appeal was given, the appeal
will be dismissed. Merchants' Nat. Bank v. Ault (Wash.), U P , 129*
11. A finding on conflicting evidence can not, on appeal, be disturbed. Lehman Y. Roth?x*rth (III Sup.), 4^N. E., 777; Smith v. Sabin (Cal), 43 P.,
588; Merchants' Nat, Bank v. McAnulty (Tex. Sup.), 33 S. W., 963.
12. A rehearing will not be granted for consideration of a question not raised
on the original hearing. Arnau v. First Nat. Bank (Fla.), IS So., 790.
13. Where, on appeal, the record does not contain the evidence, and findings
of fact were waived, it will be presumed that fhe allegations of the complaint were proven, end that the affirmative allegations in the answer
were not. Ullrich v, Santa Rosa Nat. Bank (Cal.), 37 P., 500.
14. An objection and exception to the introduction of certain evidence, for
which no ground was assigned, can not be considered on appeal. Tabor
v. Commercial Nat. Bank (C.C.A.), 62 F., 383.
15. On a trial by the court, where no request was made for a peremptory declaration that the evidence was insufficient to entitle plaintiff to judgment, a general finding for plaintiff can not be reviewed on a single
exception to the finding and the judgment thereon. Ib.
16. Where no question of law is presented by the record a certificate by the
appellate court that the case involves questions of law of such importance that they should be passed on by the supreme court does not present any questions of law to be determined. Commercial Nat. Bank v.
Canniff (III. Sup.), 37 N.E., 898.
17. In determining the questions at issue the supreme court can only look at
the record and nbt at the opinion of the appellate court. Ib.
18. Where in an action against a firm on a note signed by one partner the
court tried the case without a jury and found that such partner had no
authority to sign the note, but also found that the other partner afterwards ratified the signature, error in admitting, evidence as to tho former's authority to sign the note is immaterial. Merchants' Nat. Bank
v. Peet (Wash.), 37 P., 290.
19. An appeal taken to the circuit court of appeals from a decree of the circuit
court entered in accordance with the mandate of the former court upon
a previous appeal, will be dismissed, even though an appeal lie to the
supreme court from the decision of the circuit court of appeals. Merrill
v. National Bank of Jacksonville, 78 Fed. Rep., 208.
,a&SESSMENT: See Insolvent banks; Receiver; Shareholders; Transfer of stock.
1. Where national banking association is insolvent, order of Comptroller of
Currency declaring to what extent the individual liability of stockholders shall be enforced is conclusive. Kennedy v. Gibson, 8 Wall., 498;
Casey v. Qalli, 94 U. S., 673; National Bank v. Case, 99 U. S., 628.
2. Payments of assessments by stockholder in national bank on increased stock
can not be applied, in law or in equity, to discharge assessments by Comptroller in final liquidation of the bank. Pacific National Bank v. Eaton,
141 U. S., 227; Thayer v. Butler, Ib., 234; Butler v. Eaton, Ib.y 240.
3. The assessments made by the Comptroller upon the shareholders of an
insolvent association bear interest from the date of the order. Casey v.
Galli, 94 U. S., 673.
106
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
4. Where shareholders have assessed themselves to the amount of the par
value of the stock for the purpose of restoring inrpaired capital, the
contributions made in pursuance of such assessment, though all used in
XDaying the debts of the association, will not so operate as to discharge
the shareholders from their individual, liability. Delano v. Butler, 118
U. 8., 634.
5. Where a married woman is by the State law capable of holding stock in a
national bank in her. own right, she is liable to an assessment upon her
shares, though the law of the State does not authorize married women
to bind themselves by contracts for the payment of money. The law
annexes her obligations by its own force; no act or capacity to act on her
part is required. Witters v. Soicles, 32 Fed. Rep.. 767; 35 Fed. Rep., 040.
6. Married women who are permitted by the laws of the State in which they
reside to become shareholders in national banks are liable to assessments
under the national banking laws. In re First National Bank of St.
Albans, 49 Fed. Rep., l-o.
7. The coverture of a married woman who is a shareholder in a national bank
does not prevent the receiver of the bank from recovering judgment
against her for the amount of an assessment levied upon the shareholders
equally and ratably under the statute. Keyscr v. Hit?:, 133 U. 8.9 13S.
8. It is not essential, in an action to enforce the individual liability of the
shareholders of an insolvent national banking association, to aver and
prove that the assessment was recessary, for the decision of the Comptroller on this point is conclusive. Strong v. SouthwortJi, 8 Ben., 331;
Kennedy v. Gibson, S Wall., 498; Casey v. Galli, 94 U. S., 673.
9. And the fact that the title to the stock of a deceased shareholder vests in
his administrator does not relieve the estate from the burden of an
assessment. Davis v. Weed, 44 Conn., 509.
10. Nor will the fact that the administration is complete, and all the assets
have been distributed, defeat an action brought to recover the assessment. Ib.
11. The question whether there is a deficiency of assets, and when it is necessary to enforce the individual liability of shareholders, is for the Comptroller to determine: and his decision in this matter is final and conclusive. Kennedy v. Gibson. 8 Wall, 49S; National Bank v. Case, 99 U.S.,
628; Casey v. Galli, 94 U. S., 673.
12. The amount contributed by each shareholder should bear the same proportion to the whole amount of the deficit as his own stock bears to the
whole amount of the capital stock at its par value. And the solvent
shareholders can not be made to contribute more than their proportion
to make good the deficiency caused by the insolvency of other shareholders. United States y. Knox, 103 U. S., 422.
13. Where, to discharge liabilities of an insolvent bank, Comptroller assessed
against shareholders a sufficient per cent on par value of stock held by
each, some being insolvent, he can not provide for deficiency by new
assessment. Ib.
14. The estate of a deceased owner of national-bank stock is liable (Rev. St.,
sec. 5152) to an assessment levied against his executors in consequence
of the failure of the bank after his death. WicJcham v. Hull et al., GO
Fed. Rep., 326.
15. An action was brought against the executors of an estate to establish its
liability for an assessment on certain shares of national-bank stock. The
estate was at the time in possession of an Iowa probate court for purposes of administration, for which reason the Federal court could not
enforce the liability, if adjudged to exist. Defendant set up the limitations contained in the Iowa statute (Code, sec. 2421) regulating the settlement of estates. Held, That the Federal court would not pass upon
the question whether this provision debarred complainant from sharing
in the estate, for, as the claim established in the Federal court must be
presented for allowance in the probate proceedings, the better practice
was to remit the question to the probate court Ib.
16. Where a national bank issues certificates of its shares to a subsequent purchaser in lieu of the certificates of the prior owner, without observing
its by-law in regard to a transfer on its books, so far as creditors of the
bank are concerned a party taking and holding such shares of stock will
be subject to the liabilities imposed by section 5151 of the national banking law. Laing v. Burley, 101 III., 591; 3 N, B. C, 369.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
107
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
17. One to whom stock has been transferred in pledge or as collateral security
for money loaned, and who appears on the books of the corporation as
the owner of the stock, is liable as a stockholder for the benefit of creditors. Where the owner, holder, or pledgee of stock transfers it out and
out for the purpose of escaping liability as a shareholder to o'ne who is
unable to meet such liability, or when the transfer is colorable and not
absolute, the transfer is ineffective as to creditors, and the transferrer
will be still liable. Therefore, when the G. bank loaned money and took
as collateral therefor shares of stock in the C. bank, which were duly
transferred in the books of the C. bank, and afterwards the G\ bank
transferred these shares to one of its clerks with an understanding that
he should retransfer on request, and the C. bank was then in failing condition. Held, that the G. bank was liable to contribute as a stockholder
to the debts of the C. bank. Germania National Bank of New Orleans
v. Case, Receiver, 09 U. S., G2S; 2 N. B. C, 25.
18. A letter addressed to the receiver, and signed by the Comptroller of the
Currency, directing him to institute legal proceedings to enforce the individual liability of every stockholder, under the statute, is sufficient evidence that the Comptroller decided, before the suit-, that it was necessary
to enforce the personal liability of the stockholders. Bowden v. Johnson, 107 U. S., 251; 3 N. B. C, 55.
19. The liability of the stockholders bears interest from the date of said
letter. Ib.
20. Under the national banking act, the individual liability^of the stockholder
survives as against the personal representatives of a deceased stockholder. Richmond v. Irons, 121 U. S., 27; 3 N. B. C, 211.
21. A stockholder sold certain stock several months before the insolvency of
the bank, but the transfer was not made on the books till the date of the
bank's failure. Held, that the stockholder incurred the statutory lia. biiity. Ib.
22. Fifty shares of the stock of a national bank were transferred to F. on the
books of the bank October 29. A certificate therefor was made out, but
not delivered to him. He knew nothing of the transfer, and did not
authorize it to be made. On October 30 he was appointed a director and
vice-president. On November 21 he was authorized to act as cashier. He
acted as vice-president and cashier from that day. On December 12 he
bought and paid for 20 other shares. On January 2 following, while the
bank was insolvent, a dividend on its stock was fraudulently made, and
$1,750 therefor placed to the credit of F. on its books. He, learning on
that day of the transfer of the 50 shares, ordered D., the president of the
bank, who had directed the transfer of the 50 shares, to retransfer it, and
gave to D. his check to the order of D. individually for $1,250 of the
$1,750. The bank failed January 22. In a suit by the receiver of the
bank against F. to recover the amount of an assessment of 100 per cent
by the Comptroller of the Currency in enforcement of the individual liability of the shareholders, and to recover the $1,750, held, first, in view
of provisions of sections 5146, 5147, and 5210, Rev. St., it must be presumed conclusively that F. knew from November 21 that the books
showed he held 50 shares; second, F. did not get rid of his liability for
$1,250 by giving to D. his check for that sum in favor of D. individually.
Finn y. Brown, 142 U. S., 56'.
23. In winding up an insolvent national bank, the Comptroller of the Currency
is vested with authority to determine when a deficiency of assets exists,
so that the individual liability.of the stockholders may be enforced, and
no appeal lies from his decision. Bailey v. Sawyer, 1 N. B. C, 356; 4
Dill., 463.
24. The liability of a stockholder of a national bank is several, and is fixed by
his taking stock in the corporation. Ib.
25. When an assessment upon the stockholders is ordered by the Comptroller,
a suit at law is the proper remedy to enforce it. Ib.
26. A trustee holding shares in a national bank can not avail himself of his
exemption from personal liability for debts of the bank, unless his trusteeship appears on the books of the bank. Davis v. Essex Baptist Society,
U Conn., 582; 2 N. B. C, 110.
27. With a bequest of money a religious society purchased, and held in its own
name, snares in a national bank. The society had other donations
otherwise invested. Held, that the society was not a trustee, but an
108
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
ordinary stockholder, and liable to assessment for debts of the insolvent
bank. Ib,
28. One who procures *. transfer to himself, on the books of a national bank, of
stock in stich bank, becomes liable for the engagements of the bank as
prescribed in the national-bank act, although such stock was pledged
to him by the owner simply as security for a debt. Moore v. Jones, 3
Woods, 53; 2 N. B. C, 14429. One in whose name shares of the stock of a national bank stand on the
bank books is subject to the individual liability of a shareholder, although
his holding of the stock was originally as collateral security for a loan
and the loan has been repaid and the stock certificate surrendered with
an executed power of attorney for transfer. Botvdell v. Farmers and
Merchants9 National Bank of Baltimore, 14 Bankers' Magazine, 387; 2
N. B. C, 146.
30. The determination of the Comptroller as to the necessity of an assessment
on stockholders of an insolvent national bank for the payment of debts
is conclusive, and in a suit to enforce such an assessment the necessity
need not be alleged. Strong, Receiver, v. Southworth, 8 Ben., 331; 2
N. B. a, m.
81. S. bought shares in a national bank and caused them to be transferred to
E., who was in his employ. S. remaining the real owner. Held, that S.
was liable as stockholder upon the failure of the bank. Davis, Receiver,
v. Stevens, 20 Alb. L. J., 490; 2 N. B. C, 158.
32. In an action by the receiver of a national bank to enforce the liability of
a shareholder, it appeared that the date of the defendant's subscription
to the stock was prior to May, 1866, when the receiver was appointed;
that the Comptroller of the Currency decided on the 28th of June, 1876,
that the enforcement of this liability to its full extent was necessary,
and instructed the receiver accordingly, and that this action was thereupon brought. Held, that although such decision and order of the
Comptroller were necessary preliminaries to a suit against the shareholder, yet, having been delayed without sufficient apparent reason for
more than six years from the date of the subscription, the statute of
hr citations was a bar to the action, the State courts having decided that
an act necessarily preliminary to the commencement of a suit upon a
contract must be done within six years, unless sufficient reason for the
delay is shown. Price, Receiver, v. Yates, 19 Alb. L. J., 295; 2 N. B. C,
204.
33. Actions by the receiver of a national bank against stockholders for assessments on the stock are subject to State statutes of limitations. Butler
v. Poole, 44 Fed. Rep., 5S6.
34. A court has no power, under sec. 5324, U. S. Rev. St., to order the receiver
of a national bank to compound debts which are not " bad or doubtful;"
and a composition under such an order of debts not "bad or doubtful,"
as the debt of a shareholder arising on his subscription to the stock, is
ineffectual. Ib.
35. A stockholder of an insolvent national bank, who happens also to be one of
its creditors, can not cancel or diminish the assessment to which the provisions of sec. 5151, Rev. St., make him liable by offsetting his individual
claim against it. Hobart, Receiver, etc., v. Gould, 8 Fed. Rep., 57.
36. Section 5151, Rev. St., among other things, provides that the shareholders
of every national banking association shall be held individually responsible for all contracts, etc., to the extent of the amount of their stock
therein, at the par value thereof, in addition to the amount invested in
such shares. Held, that upon the insolvency of such a bank a shareholder who happens to be one of its creditors can not cancel or diminish
the assessment, to which the provisions of this section make him liable,
by offsetting his individual claim against it. Ib.
37. The liability which shareholders in national banks incur under section 12
of the act of 1864, which provides for a liability " t o the extent of the
amount of their stock therein, at the par value thereof, in addition to
the amount invested in such shares, "is that of principals, not of sureties.
Hobart, Receiver, etc., v. Johnson, 8 Fed. Rep., 493.
38. Such a liability is not one on a " promise to pay the debt, or answer for the
default or liability, of any other person," within the meaning of the proviso to section 5 of the Revised Statutes of New Jersey of 1874, p. 469. Ib.
39. On the principle of estoppel, one can not take advantage of certain statutory provisions without incurring thereby the attendant liabilities. Ib*
REPORT OF THE COMPTROLLER OF THE CURRENCY.
109
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
40. Under sec. 5151, Rev. St., owners of stock in a national bank are liable for
its debts, and persons who hold themselves out or allow themselves to
be held out as owners of stock are also liable, whether they own stock or
not. Case, Receiver, v. Small et al., 10 Fed, Rep., 722.
41. A married woman who owns stock in a national bank is not exempt on
account of her coverture from the liability imposed by the national currency acts upon all stockholders in such banks. Anderson v. Line, 14
Fed. Rep., 406.
42. After a national bank has become insolvent and has closed its doors for
business, its shareholders' liability to creditors is so far fixed that any
transfer of their shares must be held fraudulent and inoperative as
against the creditors of the bank. Irons et al. v. Manufacturers'1 National
Bank of Chicago et al., 17 Fed. Rep., 308.
43. The Pacific National Bank of Boston was organized in October, 1877, with
acapital of $250,000, with the right to increase it to $1,000,000. In November, 1879, its capital was raised to $500,000; September 13, 1881, the
directors voted to increase the capital to $1,000,000. On November 18,
1881, the bank suspended. On December 13,1881, the directors voted
that as $38,700 of the increase of capital stock had not been paid in the
capital befixedat $961,300, and the Comptroller of Currency was notified
to that effect, and he notified the bank, under Rev. St., sec. 5205, to pay
a deficiency on its capital stock by an assessment of 100 per cent. At
the annual meeting the assessment was voted, and on March 18,1882, with
consent of the Comptroller and the approval of the directors and the
examiner, the bank resumed business, and continued until May 20,1882,
when it again suspended and was put in the hands of a receiver. Prior
to May 20,1882, $742,800 of the voluntary assessment had been paid in.
Complainant was the owner of twenty-five shares of stock on September
13,1881. and after the vote to increase the stock took twenty-five shares,
for which he paid $2,500 on October 1,1881, and received a certificate.
He voted for the assessment at the annual meeting, and in February,
1882, paid the assessment on the old and new stock, and subsequently
sought to enjoin the suit at law against him by the receiver to enforce
his individual liability as a stockholder, under Rev. St., sec. 5151, on
the ground that the increase of capital was illegal and void, and that
the voluntary assessment, under Rev. St., sec. 5205, relieved the stockholders of individual liability. Held, that he was not entitled to relief,
and the bill should be dismissed. Morrison v. Price, Receiver, 23 Fed.
Rep., 217.
44. A discharge in bankruptcy releases a shareholder of a national bank from
his statutory individual liability to creditors of the bank where, at the
time of his discharge, the claims of such creditors were provable, not
merely contingent. Irons et al. v. Manufacturers' National Bank et al.,
27 Fed. Rep., 691.
45. When bank stock was sold, but not transferred on the books of the bank,
and the bank afterwards failed, the executors of the person in whose
name the stock stood on the books were held liable for assessment, although
said stock had been paid for by a purchaser buying at the request of the
president of the bank, who gave him a cashier's check for that purpose,
placing the money so furnished to the credit of said purchaser on the
books of the bank as a temporary loan, the intention being ultimately to
transfer said shares to a third party as part of a larger proposed investment in stock, for which funds had been placed in the hands of the president of the bank. Price, Receiver, v. Whitney et al., 28 Fed. Rep., 297.
46. Defendant subscribed for new stock in the reorganization of a bank, and
received a certificate on the basis of a total subscription of $500,000. The
actual increase was $461,300. He protested against the same, and refused
to vote on the stock, but retained his certificate until the bank went into
the hands of a receiver several months later. Held, that he was liable
to the receiver on his subscription, and it was too late to claim that the
increase as to him was invalid, Butler, Receiver, v. Aspinwall, 33 Fed.
Rep., 217.
47. A pledgee of shares of stock in a national bank, who does not appear by the
books of the bank or otherwise to be the owner, is not liable for an assessment upon the shares on the insolvency of the bank, under Rev. St., sec.
5151, rendering shareholders liable for the debts of the association to the
extent of the par value of their stock. Welles v. Larrabee et al., 36 Fed.
Rep., 866.
110
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued'.
48. One to whom the shares are assigned in trust as security for a debt due a
third person, and following whose name on the stock book of the bank
is the word "trustee," is not liable for the assessment under section 5151,
and is also within the provision of section 5152, exempting from such
liability persons holding stock as trustees. Ib.
49. In an action by the receiver of an insolvent national bank to recover of a
stockholder an assessment on his shares, the defendant alleged as a counterclaim that the Comptroller of the Currency had directed the bank to
restore the value of certain securities held by it which had been reported
worthless by an examiner; that certain of the stockholders, including
defendant, had raised a fund which was placed in the hands of trustees
to apply so much as might be from time to time required by the Comptroller to retire such securities; that the fund was deposited with the
bank with full notice of the purpose to which it was to be applied; that
a portion had been used to retire the securities designated, and that when
the bank failed the balance of the fund came into the hands of the
receiver, and was now claimed b)r him as a part of the ordinary assets
of the bank; that a certain portion of this balance belonged to defendant, which amount he asked to set off against plaintiff's demand. Held,
that a general demurrer based on the ground that no set-off or counterclaim was available in, such an action would be overruled, as the claim
could be set off if it was of such a nature that the holder would be entitled to receive the full amount before distribution by the receiver to
general creditors. Welles y. Stout, 88 Fed, Rep., 807,
50. Where a shareholder of a national bank makes a bone fide sale of his stock
and goes with the piirchaser to the bank, indorses the certificate, and
delivers it to the cashier of the bank with directions to make the transfer
on the books, he has done all that is incumbent upon him to discharge
his liability, and he is not liable, though the cashier failed to make the
transfer, upon the subsequent suspension of the bank, for an assessment
made by the Comptroller of the Currency, under Rev. St., sec. 5151, to
pay the bank's debts. Hayes v. Shoemaker, 89 Fed, Rep,, 819,
51. Defendant, for the purpose of helping a bank, of which complainant was a
stockholder, in a financial crisis, loaned it certain securities belonging to
complainant, and when complainant was informed of the fact she did not
object. She was assured by the bank's officers that if the bank was saved
the securities would be returned, and if it failed the avails would be credited on her assessment as a stockholder. The bank failed, and the securities were not returned. Held, that she was not entitled, as against other
creditors, to set off the value of the securities against her assessment, but
was, as to such value, on the same footing as any other creditor. Soiules
v. Witters et al,, 89 Fed, Rep., 408.
52. One who subscribes and pays for a specified number of shares of a "proposed increase " of the capital stock of a national bank, which increase is
in fact never issued, and to whom the bank officials transfer, instead, old
stock of the bank without his knowledge or consent, is not a "shareholder " within the meaning of Rev. St., sec. 5151, imposing individual
liability on the shareholders for the debts of national banks. Stephens
v. Follett et al, 48 Fed. Rep,, 842.
53. The fact that the subscriber for the new shares received a dividend on the
old shares so transferred to him does not estop him from denying his liability as a shareholder, where such dividend was received in the belief
that it was paid to him by virtue of his subscription to the new stock. Ib.
54. A person who becomes a stockholder in a national bank thereby submits
himself to the provisions of the national-bank act, and becomes liable to
be assessed to the extent of his statutory liability for all debts of the bank
existing while he holds his stock. Young v. Wempe et al,, 46 Fed. Rej),, 804,
55. In an action by the receiver of a. national bank to enforce an assessment
under Rev. St., sec. 5151, against one credited on the transfer books as a
stockholder, it appeared that nearly a year before the failure he had sold
his stock to a broker for an undisclosed principal; that he indorsed the
same, and requested the broker to inform the cashier of the transaction,
and to have the stock transferred; that the broker accordingly handed
the stock to the cashier, gave him the necessary information, and
requested him to make the transfer. This the cashier promised to do,
but in fact the transfer was never made. The certificate recited that it
was transferable on the books of the company "by indorsement hereon
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Ill
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
and surrender of this certificate." Held, that in requesting the cashier
to make the transfer the broker acted as the seller's agent, and that the
latter did all that was required of him as a prudent business man, and
could not be held liable as a stockholder. Young v. McKay, 50 Fed,
Rep., 394.
56. A Federal court will not, even if it has the power under Rev. St., sec. 5234,
grant an order authorizing a receiver of a national bank to confound
the statutory liability of certain stockholders by accepting payment of
a gross sum, less than is due, in satisfaction and discharge thereof,
although more money would thus be realized than by proceedings to
collect the same in the usual way, when it appears probable tnat such
stockholders have fraudulently conveyed their property to avoid their
legal obligations as stockholders, or to shield themselves from injury
and exposure by litigation. In re Certain Shareholders of the California
National Bank of San Diego, 53 Fed. Rep., 88.
57. A person who is entered on the books of a national bank as the owner of
stock, but who is admitted to hold the stock in trust for the true owner,
is not liable as a stockholder for the debts of the bank, when the true
owner has been adjudged so liable, although nothing is realized upon
the execution of such judgment. Yardley v. Wilgus, 56 Fed. Rep., 965.
58. When the full personal liability of shareholders is to be enforced the action
must be at law. Kennedy v. Gibson, 8 Wall., 498; Casey v. Galli, 94
U. S., 673.
59. And it may be at law, though the assessment is not for the full value of
the shares; for, since the sum each shareholder must contribute is a
certain exact sum, there is no necessity for invoking the aid of a court
of equity. Bailey y. Satcyer, 4, Dill, 463; 1 N. B. C, 356.
60. But the suit may be in equity. Kennedy v. Gibson, 8 Wall., 498.
61. It is no objection to a bill against stockholders within the jurisdiction of
the court that other stockholders, not within such jurisdiction, are not
codefendants. Ib.; Casev. Bank, 100 U. S.t 446.
62. But a pledgee of shares of stock in a national bank who in good faith and
with no fraudulent intent takes the security for his benefit in the name
of an irresponsible trustee for the avowed purpose of avoiding individual
liability as a shareholder, and who exercises none of the powers or rights
of a stockholder, incurs no liability as such to creditors of the bank in
case of its failure. Anderson, Receiver, v. Phila. Warehouse Company,
111 U.S.,479.
63. The individual liability of the shareholders of an insolvent association may
be enforced for the purpose of paying all of its liabilities, and not merely
for the purpose of paying its "debts," technically so called. Stanton v.
Wilkeson, 8 Ben., 357.
64. The individual liability of the stockholders must be restricted in its meaning to such contracts, debts, and engagements of the association as have
been duly contracted in the ordinary course of its business. And, therefore, creditors of an association who make settlements after the association is put into liquidation and receive from the president payment
of their claims in paper of the association, or of the individual notes of
the president himself, indorsed or guaranteed in the name of the association, are not to be considered as creditors of the association entitled to
subject the stockholders to individual liability, for these are new contracts. Richmond v. Irons, 121 11. S., 27.
65. The individual liability of the stockholders is enforceable only in behalf of
all the creditors, and any security given by a stockholder for his liability
in this respect should likewise be for the benefit of all the creditors.
Accordingly, a mortgage of all the individual property of a stockholder,
made after the bank has closed its doors, for the purpose of securing a
single depositor, is void as against a judgment obtained against such
stockholder in an action by the receiver to recover the amount of his
individual liability. Gatch v. Fitch, 34 Fed. Rep., 566.
66. Bill filed by receiver against transferrer and transferee to enforce such
liability will lie where it is for discovery as well as relief, as the transfer
would be good between the parties. Bowden v. Johnston, 107 U. S., 251.
67. A shareholder in a national bank, who is liable for its debts, is liable for
interest thereon to the extent of the bank's liability, and not in excess
of the maximum liability fixed by statute. Richmond v. Irons, 121
U. S., 27.
112
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
68. The creditors of an insolvent association must seek their remedy through
the Comptroller, in the mode prescribed by the statute; they can not
proceed directly in their own names against stockholders or the debtors
of the bank. Kennedy v. Gibson, 8 Wall., 498.
89. Each shareholder of a national banking association is individually liable
for its debts to the extent of the amount of his stock at its par value, in
addition to the amount invested in the shares held by him, and a receiver
appointed to wind tip the affairs of such an association that has become
insolvent is authorized, under the direction of the Comptroller of the
Currency, to enforce the liability of its stockholders, and to collect from
each of them the necessary amount, up to the extent of his liability, for
the payment of the creditors. King et al. v. Armstrong, Receiver, 34
N. E., 163; 50 Ohio St., 222.
70. Code N. C , sec. 1826, provides that no woman during coverture shall be
capable of making any contract to affect her real and personal estate
without the written consent of her husband. Held, that a purchase of
stock by a married woman is not a " contract" within the terms of the
statute, and that the wife is liable upon an assessment, although the
stock was purchased without the written consent of her husband. Robinson v. Turrentine et al., 59 Fed. Rep., 554.
71. One in whose name stock of an insolvent national bank stood paid an
assessment thereon under a threat by the receiver to sue therefor,
though he claimed that he had sold the stock. More funds were collected than were required to pay the creditors of the bank. Held, that
such payment could not be recovered as having been made under a mistaken belief by the payor that the whole amount would be required to
pay the creditors of the bank. Holt y. Thomas (Cal.), 38 P., 891.
72. The F. National Bank suspended business for lack of funds, and was
placed in charge of a bank examiner, who required that $50,000 should
be raised and placed in the bank before it could resume business. The
stockholders, incJuding one B., the president, thereupon raised this sum,
in amounts equal to 50 per cent of their stock, and placed it in the bank.
The examiner caused entries to be made on the books indicating that
this contribution was a voluntary assessment subject, after one year, to
the liabilities of the bank, and permitted the bank to resume. B., at a
meeting of the directors subsequently held, protested against these book
entries, but afterwards signed reports in which the $50,000 w«as included
as surplus. At the time of the advance the bank held two notes of B.,
and discounted another note of his a few days before the expiration of
a year from the advance. Shortly after the expiration of the year the
bank again suspended payment. Held, that the advance to the bank
was a voluntary assessment, and not a loan, and could not be set off
by B. in an action against him on the notes by the receiver of the bank.
Brodrick v Broivn, 69^ Fed. Rep., 497.
73. M. bequeathed to his wife "for life or widowhood" 40 shares of stock in a
national bank, together with other personal property, providing that
she might use any of such personal property if necessary for her comfortable support, and that, at her death or marriage, whatever should
remain of such property should go in equal shares to his four children.
The administrator with the will annexed of M.'s estate transferred the
stock on the books of the bank to M.'s widow. The bank having become
insolvent, and an assessment having been made by the Comptroller on
the shareholders, for which a judgment was obtained against M. 's widow,
which remained unsatisfied, the receiver of the bank brought suit against
M.'s administrator to compel payment of the assessment out of M.'s
general estate. Held, that whether the widow took an absolute title to
the stock by virtue of her power of disposal, or a life interest with
remainder to the children, the beneficial ownership of the stock, in
either case, had passed from M.'s estate, and the estate could not be
made liable for the assessment. Held, further, that the administrator
properly transferred the stock to the widow, and was not required to
hold the legal title thereto, as administrator or trustee, during her life
or widowhood, but that such transfer made no difference to the liability
of the estate of M., since the beneficial interest would in either case
have been in the widow and children. Blackmore v. Woodward et al.,
71 Fed. Rep., 321.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
113
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
74. The capital, the unpaid subscriptions to the capital stock, and the liability
of the holders of the paid-up stock to pay an additional amount equal to
the par value of their stock under section 5151, Rev. St., constitute
a trust estate sacredly pledged for the security of the creditors of a
national banking association. The willful destruction or diminution of
any part of this trust estate or the diversion of the proceeds of any
of it from the creditors of the bank is a fraud upon these creditors, and
subjects its perpetrator to a suit by them or their legal representative
for proper relief. Stuart v. Hayden et ah, 72 Fed, Rep., 402.
75. One who knowingly permits his name to he entered upon the stock books
of a national bank, as the owner, individually, of stock therein, can not
be permitted, as against creditors or a receiver of the bank representing
them, to show that he was not the owner of 'the stock, and he is liable
for an assessment thereon, though he held the stock, in fact, as trustee
for the bank itself. Leivis v. Switz, 74 Fed. Rep., 381.
76. One C. was the holder of stock in the D. National Bank, and was also an
officer of the L. bank, which held stock in the D. bank. In the latter
capacity he was informed of an urgent demand upon the L. bank to send
$5,000 by telegraph in aid of the D. bank. Within a week after this
demand L. transferred his stock in the D. bank, without consideration,
to his five children, one of whom was a married woman, and two minors.
Within five months thereafter the D. bank failed and an assessment
was made on the stockholders. Held, that the transfer must have been
made by L. in contemplation of the liability, and that both he and his
transferees were liable for the assessment, the latter because the liability
was cast upon them by law when they became stockholders. Foster v.
Lincoln et al., 74 Fed. Rep., 382.
77. In an action by the receiver of a national bank to enforce the individual
liability of a stockholder, an allegation in the complaint that on a given
date the Comptroller, having ascertained and determined that the assets,
property, and credits of the bank were insufficient to pay its debts and
liabilities, and, as provided by the act of Congress, made an assessment
and requisition on the shareholders of the said bank of a given sum upon
each share held and owned by them, respectively, at the time of its
default, and directed the receiver to take all necessary steps to enforce
the liability, is sufficient. Kennedy v. Gibson, 8 Wall,., 498, distinguished; Nead v. Wall (C. C.),70F, 806.
78. One buying stock in a national bank in the names of his minor children
himself becomes liable to assessment as a shareholder, for minors are
incapable of assenting to become stockholders, so as to bind themselves
to the liabilities thereof. Foster v. Chase et ah, 75 Fed. Rep., 797.
79. An executor who receives certificates of national-bank stock as part of the
assets of decedent's estate, and includes them in his inventory returned
to the probate court, is a shareholder, and liable as such for an assessment, under Rev. St., § 5151, subject to the relief granted by section
5152. Parker v. Robinson (C. C. A.), 71 F., 256.
80. The complaint, in an action by the receiver of an insolvent national bank
to enforce an assessment on the shareholders, made by the Comptroller
of the Currency, need not aver that there was a necessity therefor, or
that the Comptroller determined that there was such necessity, though
the law provides that the Comptroller may enforce the individual liability of the stockholders, if necessary to pay the debts of the bank. It
is enough that the complaint alleges that the Comptroller made the
assessment and directed its enforcement. O'Connor v. Witherby (Cah),
44 P., 227.
81. The allegation of the complaint, in an action for an assessment on shareholders in a bank, that " defendant, though demanded, has failed and
refused to pay said assessment, or any part thereof," is a sufficient averment, as against a general demurrer, of nonpayment at the time action
was commenced. 1b.
82. In an action by the receiver of an insolvent national bank to enforce an
assessment on the shareholders, made by the Comptroller of the Currency, the necessity of the Comptroller's making as large an assessment
as that in suit can not be litigated. Ib.
83. The bill contemplated by the second section of the act of June 30, 1876, to
enforce the individual liability of stockholders in a national-banking
association that has gone into liquidation, need not purport expressly on
H . Doc. 10
8
114
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
its face to be filed by the complainant on behalf of himself and all other
creditors, for the law would give it that effect and the court would so
treat it; but, if this was necessary, the bill might be amended in that
respect by leave of the court. Irons, Ex'r, etc., and others v. Manufacturers' Nat. Bank of Chicago and others, 17 Fed. Rep., 308.
84. The manifest intention of the national-banking act is a distribution of its
assets, in case a bank becomes insolvent, equally among all the unsecured creditors, and the diligence of a creditor who files a creditor's bill
can give him no greater rights than are given any other creditor to share
in the distribution of the assets, and a prayer in the bill that such creditor be given priority over other creditors will not be granted. Ib.
85. Where the original bill, filed before the passage of the act of June 30,1876,
was amended after the passage of that act so as to make the individual
shareholders defendants, and subject them to liability, such bill will not
be considered on that account multifarious. Ib.
86. The act of June 30,1876, did not create any new liability on the part of the
stockholders, or provide for enforcing such liability against them under
circumstances where it could not have been enforced before that act
was passed. This act is not retroactive, and does not create rights which
did not exist prior to its passage as against existing stockholders, though
it may be construed as limiting the tribunal in which proceedings are to
b3 instituted for enforcing the stockholder's liability to a United States
court, instead of allowing creditors to resort to any competent tribunal
with equity power. Ib.
87. Entering an order that " the complainants confessing the pleas of bankruptcy of defendants, it is ordered that this case be stayed as to them,"
does not amount to a final decree, but simply confesses the facts set up
in the plea, leaving the court to adjudge the law upon such facts whenever the maiii cause is heard. Ib.
88. Where the original bill was filed February 3,1875, before the passage of
the act of June 30,1876, and a receiver was appointed February 26,1875,
thereunder, and an amended bill, making the individual stockholders
defendants, was filed October 5,1876, and after the filing of the amended
bill certain of the defendants were adjudged bankrupts, their pleas of
bankruptcy will constitute a sufficient bar in their behalf. Ib.
89. Where it is admitted by the defendants that they were shareholders in a
national bank, but the number of shares respectively held by them is
not admitted, the names of the shareholders and the number of shares
held by each, as shown by the stock ledger, and stubs of the stock certificates, and the dividend sheets of the bank on which they respectively
drew the last dividends, will be prima facie proof of the number of
shares held, and, unless, rebutted, sufficient. Ib.
90. A bill to enforce against the separate estate of a married woman an assessment upon shares of national-bank stock is not open to the objection
that it does not allege that she had the capacity to become a stockholder,
whether she became such before or after marriage, where it alleges
that she was the owner of the shares, and where a statute of the State
in which the bank is located (Dig. St. Ark. 1874, sec. 4194) provides
that a married woman may transfer her x^roperty, carry on any business and perform any services on her separate account, and that her
earnings shall be her separate property and may be used or invested by
her in her name. Bundy v. Cocke, 128 U. S., 185; 3 N. 13. C, 316.
91. The bill alleging that the married woman is possessed of property in her
own right sufficient to pay the assessment and praying for a decree of
payment therefrom, and the bill of revivor filed after her death against
her husband praying for relief out of the assets received by him as her
legatee, devisee, or executor, the case is one of equitable cognizance. Ib.
92. A suit by the receiver of an insolvent national bank to collect an assessment by the Comptroller upon the stock from a stockholder who has made
an alleged fraudulent transfer of his shares is based upon the statutory
liability of the stockholder, and not upon any injury growing out of the
fraudulent transfer; and therefore the statute of limitations begins to
run from the date the assessment becomes due, and not from the discovery of the fraud. Thompson v. German Ins. Co. et ctl., 77 Fed.
Rep.,25S.
93. On a bill by the receiver of an insolvent national bank to collect an assessment by the Comptroller on the stock from a former stockholder, on the
REPORT OF THE COMPTROLLER OF THE CURRENCY.
115
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
ground that, to escape liability, he had transferred his shares, within
six months of the failure of the bank^to one having no means, it
appeared that the transfer was made on the books of the bank, no concealment thereof being attempted, and that the receiver made no inquiry
as to the nature of the transfer, and took no action against defendant
until the assessment had become barred. Held, that equity would not
relieve against the bar of the statute. Ib.
94. It is not necessary, in order # to hold liable for an assessment upon the
shareholders of an insolvent national bank one who has transferred his
stock to an irresponsible person, to show that the transferrer had actual
knowledge of the insolvency of the bank at the time of the transfer, but
it is sufficient if he had good ground to apprehend its failure, and made
the transfer with intent to relieve himself from individual liability,
Cox v. Montague, 7S Fed. Rep., 81^5.
95. Upon the trial of a suit brought by the receiver of an insolvent national
bank to collect an assessment from one who had transferred his stock, a
letter written by the defendant to a bank examiner, in reply to an
inquiry about the bank, in which defendant admits his transfer of his
stock when the bank was embarrassed, is not a privileged communication, though the bank examiner's letter, to which it is a reply, is marked
"Confidential." Ib.
96. A corporation which receives shares of national-bank stock in pledge, with
power to use and sell, and which, in good faith, without suspicion of the
bank's insolvency, causes new certificates to be issued in the name of one
of its employees, merely because it is unwilling they should stand in the.
name of the original owners, remains a mere pledgee, and is not liable,
as a shareholder, to assessment on the stock. National Park Bank of
City of New York v. Harmon, 79 Fed. Rep., 891.
97. L., a stockholder in the D. national bank, transferred his stock shortly
before its failure to his married daughter and other minor children. It
appeared from the circumstances surrounding the transaction that L.,
though perhaps not supx>osing the D. bank to be actually insolvent, was
advised of facts not generally known, which indicated such uncertainty
as to its ability to stand a run, which had apparently begun, as to make
it safer for him to dispose of his stock forthwith, and that the transfer
was made with the intent that, if all came out well, his children should
have the stock, while, if the bank met with disaster, he would not be
obliged to throw good money after bad. Held, that the transfer so made
could not stand against the creditors of the bank, and L. was liable at
the suit of its receiver for an assessment on the stock. Foster v. Lincoln's Ex'r, 79 Fed. Rep., 170.
98. A national bank which has purchased from a third party shares of stock
in another national bank as an investment, and which appears on the
books of the latter bank as a stockholder, is estopped, after the latter's
failure to deny liability to an assessment on the stock on the ground that
its purchase thereof was ultra vires. First Nat. Bank'of Concord v.
Hawkins, 79 Fed. Rep.. 51. Overruled in California National Bank v.
Kennedy, 167 U. S., 362.
99. The liability of a shareholder in a national bank to an assessment on his
shares is 'not a contractual liability flowing from his acquisition of i^he
shares, but a liability which arises by force of the statute authorizing
the assessment. Ib.
100. The circuit court has jurisdiction of an action to ascertain or fix the
liability upon shares of an insolvent national bank which are alleged
to have been transferred with a fraudulent intent to escape such liability
when the amount of the assessment exceeds §2,000 exclusive of interest
and costs, llwmpson v. German Ins. Co. et al., 76 Fed. Rep., 892.
101. The right of the receiver of an insolvent national bank to enforce the liability of stockholders, though created by United States statute, may
be barred by the running of a State statute of limitations. Campbells.
City of Haverhill, 15 Sup. Ct.,217; 155 U. S., 610. Ib.
102. The bar of a statute of limitations will be enforced, when applicable, in
equity as well as at law. Ib.
103. The action of the Comptroller in making an assessment against the stockholders of an insolvent national bank creates a right of action against
the stockholders, but is not the institution of a suit to enforce it so as to
stop the running of limitation. The statute begins to run from the
date the assessment becomes due. Ib.
116
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ASSESSMENT: See Insolvent banks; Receiver; Shareholders, etc.—Continued.
104. A creditor who receives from his debtor a transfer of shares in a national
bank as security for iris debt, and who surrenders the certificates to the
bank, and takes out new ones in his own name, in which he is described
as pledgee, and holds them afterwards in good faith as such pledgee and
as collateral security for the payment of his debt, is not a shareholder
subject to the personal liability imposed upon shareholders by Revised
Statutes, section 5151. Pauly v. State Loan and Trust Company, 165
U. 8. 606.
105. The previous cases relating to the liability of such shareholder examined
and held to establish:
(1) That the real owner of the shares of the capital stock of a
national-banking association may, in every case, be treated as a shareholder within the meaning of section 5151;
(2) That if the owner transfers his shares to another person as collateral security for a debt due to the latter from such owner, and if, by
the direction or with the knowledge of the pledgee, the shares are
placed on the books of the association in such way as to imply that the
pledgee is the real owner, then the pledgee may be treated as a shareholder within the meaning of section 5151 of the Revised Statutes of
the United States, and therefore liable, upon the basis prescribed by that
section, for the contracts, debts, and engagements of the association;
(3) That if the real owner of the shares transfers them to another
person, or causes them to be placed on the books of the association in
the name ot another person, with the intent simply to evade the responsibility imposed by section 5151 on shareholders of national-banking
associations, such owner may be treated, for the purposes of that section, as a shareholder, and liable as therein prescribed;
(4) That if one receives shares of the stock of a national-banking
association as collateral security to him for a debt due from the owner,
with power of attorney authorizing him to transfer the same on the
books of the association, and being unwilling to incur the responsibilities of a shareholder as prescribed by the statute, causes the shares to
be transferred on such books to another, under an agreement that they
are to be held as security for the debt due from the real owner to his
creditor—the latter acting in good faith and for the purpose only of
securing the payment of that debt without incurring the responsibility
of a shareholder—he, the creditor, will not, although the real owner
may, be treated as a shareholder within the meaning of section 5151;
and
(5) That the pledgee of personal property occupies toward the
pledgor somewhat of a fiduciary relation, by virtue of which, he being
a trustee to sell, it becomes his duty to exercise his right of sale for the
benefit of the pledgor. Ib.
106. Where one residing in Maryland subscribes for stock of a national bank
of another State, and then transfers it to his wife, also a resident of
Maryland, she becomes owner thereof, and is subject to stockholders'
liability, under Revised Statutes, United States, § 5152, without regard
to the laws of the other State relative to contract by married women.
Kerr v. Urie (Md.), 87 A., 789.
}07. A person appearing on the books of a national bank to be absolute owner
of stock is subject to stockholders' liability, though holding it as
trustee. Ib.
108. It has been repeatedly settled by this court that the Comptroller of the
Currency has power to appoint a receiver of a defaulting or insolvent
national bank, and to call for a ratable assessment upon the stockholders
of such bank, without a previous judicial ascertainment of the necessity
for such action; and the contention that there is presented in this case
a constitutional question not considered in the prior cases is an assumption with no foundation in fact. Bushnell v. Leland, I64. U. 8., 68j.
109. As by Rev. St., U. S., sec. 5242, an attachment issued before final judgment from a State court against a national bank is prohibited, such an
attachment does not operate as notice to the absent defendant, so as to
give the court jurisdiction of the party or subject-matter. Safford v.
First Nat. Bank (Vt), 17 A., 748.
ATTACHMENT:
1. The stock of a shareholder indebted to it may be attached by the association and sold on execution. Hagar v. Union National Bank, 63 Me., 509.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
117
ATTACHMENT—Continued.
2. No State court can issue an attachment against the funds of a national bank.
Although the provision forbidding attachments was evidently made to
secure equality among the general creditors in the division of the proceeds of the property in an insolvent bank, its operation is by no means
confined to cases of actual or contemplated insolvency; but the remedy is
taken away altogether and can not be used under any circumstances.
The effect of the provision in sec. 5242, Rev. St., is to write into all State
attachment laws an exception in favor of national banks, and all such
laws must be read as if they contained an exception in favor of national
banks. Pacific National Bank v. Mixter, 124 U. S., 721.
3. No attachment can issue from United States circuit court in an action
against a national bank before final judgment in the cause, and a bond
given on such attachment is illegal. Ib.
4. An attachment can issue against a national bank from a State court. Robinson v. National Bank of Newbern, 58 Hoiv. Pr., 306; 2 N. B. C.,309.
5. The provision of the national banking act that attachments, injunctions,
etc., shall not be issued by State courts against national banks before
final judgment relates only to actions against banks where the action is
brought, and not to cases where the action is against a nonresident corporation. Southioick v. The First National Bank of Memphis, 7 Hun.,
96; 1 N. B. C, 789.
6. An attachment will not lie before final judgment against the property in
this State of a national bank situated and doing business in another State.
Rhonerv. National Bank of Allentown, Pa.; Palmer v.Same,14 Hun.,
126; 2 JV. B.C. ,331.
7. An attachment can not be issued from a State court against a national
bank before final judgment, whether such bank be located in this State
or not. Central National Bank v. Richland National Bank, 52 Howard,
136; l]Sr:B.C.,S01.
8. The provision of the national-banking act prohibiting attachments in such
cases is not repealed by the act of Congress of July 12, 1883, providing
that the jurisdiction for suits thereafter brought against national banks
shall be the same as for suits against State banks and' repealing laws
inconsistent therewith. Raynor v. Pacific National Bank, 93 N. Y., 371;
3 N.B.C.,624.
9. An unrecorded transfer of national-bank stock will take precedence of a
subsequent attachment in behalf of a creditor without notice. Continental National Bank v. Eliot National Bank et al., 7 Fed. Rep.,369.
10. The loss of interest occasioned by an attachment wrongfully laid is clearly
an injury for which damages are recoverable against the wrongdoer.
Jacobus v. Monongahela National Bank of Brownsville, 35 Fed. Rep., 395.
11. Where shares of corporation stock are attached, the subsequently declared
dividends are as much bound by the attachment as the corpus of the
stock itself is. Ib.
12. Counsel fees and other expenses (not taxable as costs) paid or incurred in
defending against an attachment wrongfully laid are not recoverable as
damages in an action upon a statutory recognizance given when the
attachment was issued, conditioned for the payment to the party
aggrieved of "such damages as the court may adjudge." Ib.
13. When a creditor attaches the property of an insolvent bank he can not hold
such property against the claim of a receiver appointed after the attachment suit was commenced. Such creditor must share pro rata with all
others. First National Bank of Selma v. Colby, 21 Wall., 609; Harvey
v. Allen, 16 Blatch.,29.
14. Sureties on attachment bond against national bank who have received
assets of the bank to secure them from loss thereon, the obligation being
illegal, will be discharged in equity and be compelled to transfer their
collateral to the receiver of the bank. Pacific National Bank v. Mixter,
124 U. 8.9 721.
15. An attachment from a State court may not issue against an insolvent
national bank of that State. National Shoe and Leather Bank of the
City of New York v. Mechanics' National Bank of Newark, N. J.; Corn
Exchange Bank v. Same; West Side Bank v. Same, 89 N. Y., 467; 3 N.
B. C, 601.
16. An attachment issued against an insolvent national bank is invalid (U. S.
R. S., sec. 5242) and is not made valid by the subsequent acquisition by
the bank of further capital. Raynor v. Pacific National Bank, 93 N. Y.,
371; 3 N.B. C, 624,
118
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ATTACHMENT—Continued.
17. Although the bank after the issuing of the attachment paid a large
amount of its debts in full, this does not estop it from questioning the
validity of the attachment. Ib.
18. A receiver of a national bank situated in another State, though not a
party, may move to vacate an attachment. People's Bank of the City
of New York v. Mechanics' National Bank of Newark, 62 How. Pr., 422;
3 N. B. C., 670.
19. In an action against a national bank of another State an attachment
issued against its property in this State will be vacated upon proof of
its insolvency. Ib.
20. The defendant, a national bank at Boston, Mass., on November 18, 1881,
closed its doors and was put in charge of a Government bank examiner
and thus continued till "March 14,1882, when the Comptroller allowed
it- to resume. It transacted business till May 22, 1882, when it was
placed in the hands of a receiver. An attachment was issued in this
action November 19,1881, against defendant's property in this State.
At that time its assets would have paid its debts and liabilities exclusive
of its capital, but it had refused to pay various legal obligations then
due. Held, that defendant had committed acts of insolvency within
U. S. Rev. St., sec. 5242, and the attachment should be vacated. Market
National Bank of New York v. Pacific National Bank of Boston, 30
Hun., 50; 3 N. B. C'., 6";,?.
21. Bank property attached by individual creditor after bank is insolvent can
not be sold to pay his demand against the claim of a receiver subsequently appointed. National Bank v. Colby, 21 Wall, COO.
22. Where service is made on a national bank only by attachment and publication or service out of the State the attachment, being prohibited by
Rev. St., sec. 5242, should be vacated and the service set aside. Garner
v. Second National Bank (C. C ) , 66 F, 369.
23. A bank which discounted a draft to which was attached, deliverable to its
order, a bill of lading of the goods against which the draft was drawn
was not required, on notice of nonacceptance of the draft, to charge the
amount thereof against the drawer's account, which was sufficient to
pay the draft, in order to enforce its lien on the property against an
attaching creditor of the drawer. Neill v. Rogers Bros. Produce Co.
(W. Va.),23 S.E., 702.
24. In an action by an attaching creditor against certain plaintiffs in an action
to repleyy the attached property for the appointment of a receiver, L.,
who claimed a lien by virtue of an attachment prior to plaintiff's, was
not made a party to the action, and after the appointment of the receiver
he made a motion to modify the order made therein so far as it directed
the sheriff to deliver to the receiver the property held under his attachment. Held, that L. might appeal from an order denying such motion.
National Park Bank v. Goddard (Sup.), 20 N. Y. S., 499; In re Lilianthai, ib.
25. A receiver who simply holds property pending the determination of an
action to settle the ownership of the same has no interest in such action
and will not be allowed to intervene. National Park Bank v. Goddard
(Sup.), 20 N. F. S., 526.
26. An attaching creditor of an insolvent corporation acquires no right superior to other creditors. Farmers & Merchants' Nat. Bank v. Waco
Electric Railway & Light Co. (Tex. Civ. App.), 36 S. W., 131; Metropolitan Trust Co.v. Farmers & Merchants1 Nat. Bank, ib.
27. An attaching creditor of an insolvent corporation for which a receiver is
appointed after the attachment acquires no preference right or lien that
will deprive the court of the power to equitably apportion the earnings
of the property during the receivership to claims classed as operating
expenses. Ib.
28. An appearance by counsel of a nonresident attachment defendant, for the
sole purpose of moving a discharge of the levy and the dissolution of
the attachment, does not constitute a general appearance, and service
must be made by publication before default and judgment can be
entered. Exchange Nat. Bank v. Clement (Ala.), 19 So., 814.
29. In an action against a nonresident commenced by attachment, unless the
levy is fictitious or merely colorable, the defendant can not, as a ground
for abating the action, dissolving the attachment, or vacating the levy,
traverse the ownership of the property attached, or deny having a leviable interest therein. Ib.
REPORT OP THE COMPTROLLER OF THE CURRENCY.
119
ATTACHMENT—Continued.
30. A national bank holding funds belonging to a bankrupt estate as depositary of a bankrupt court can not be garnisheed in proceedings supplementary to execution. Havens v. National City Bank of Brooklyn, 6
Thompson & Cook, 346; 1 N. B. C., 7S3.
81. Under tJ. S. Revised Statutes, section 5242, providing that no attachment
before final judgment shall be issued .in any State court against a
national bank, and U. S. Revised Statutes, section 915, entitling the
plaintiff in actions in the Federal courts to similar remedies by attachment to those provided by the laws of the State in which such courts are
held, a Federal court may not issue a writ of attachment before final
judgment against a national bank. Butler v. Coleman, Same v. Mixter,
Same v. Whitney, Same v. Deinmon, 124 U. S., 721; 3 N. B. C, 291.
32. A bond given to release property from an illegal attachment is void. Ib.
33. The principal in a bond given in an attachment suit may maintain an
action in equity to have the bond declared void and the property held
by the sureties as indemnity returned. Ib.
BONDS OF OFFICERS:
1. It is not necessary that national banking associations shall signify their
approval of the official bonds of their officers by memoranda entered
upon the journals or minutes of the directors. The acceptance is to be
presumed from the retention of the bond, and from the fact that the
officer is permitted to enter upon or continue in the discharge of his
duties. Graves v. The Lebanon National Bank, 10 Bush., 23.
2. Where the sureties of an officer can reasonably be presumed to have been
deceived by the statement of the condition of the bank published just
prior to the execution of the bond, and to have been led to think that
there was no deficit, whereas there had been a misapplication of a large
part of the funds by the officer whose bondsmen they became, which
fact would have been ascertained had the directors exercised ordinary
djligence, the sureties are discharged from their liability. Ib.
3. A surety on the bond of a cashier of a national bank is not discharged by
the fact that the cashier had, before the bond was given, committed
frauds upon the bank, if such frauds were unknown to the officers of
the bank, although they were guilty of gross negligence in not discovering them. Tapley v. Martin, 116 Mass., 27d; 1 N. B. C, 611.
4. The engagement of a surety is a direct original agreement with the obligee
that in the event his principal fails he will perform the original obligation, and whether it is entered into jointly with the principal or separately, the extent and character of the obligation are the same as to
both, depending only upon the form in which it is expressed. La Rose
et al. v. The Logansjoort National Bank et al,9 102 Ind., 332.
5. The contract of obligors, whether entered into separately or jointly with
the principal, if by its terms it appears that the principal is separately
bound by an original, independent contract, to which the contract for
security is collateral, and the obligors agree therein that the principal
will pay or perform according to his original engagemerit,«and that they
will answer for his default in the event of failure, is a contract of
guaranty. Ib.
6. The contract of the sureties in the bond of a bank cashier, conditioned for
the faithful discharge of his duties by such cashier, is a contract of
guaranty. Ib.
7. A failure to give notice to guarantors of the default of their principal,
except in cases governed by commercial rules, is a matter of defense,
and resulting damages must concur with such failure in order to work
a discharge. Ib.
8. Where by a by-law of a bank its cashier is made responsible for the funds
and valuables of the bank, it can not be implied that his bond would
not become operative until all the other officers and employees were
denied access to such funds and valuables nor that he is responsible for
losses which may occur, through the delinquencies of others. Ib.
9. The bond of a bank cashier, executed and approved two weeks after he
enters upon his duties, is upon sufficient consideration, and is operative,
at least, from the date of its approval. Ib.
10. The knowledge by an employer of the misconduct of an employee whose
conduct and fidelity have been guaranteed by another, which will, if
concealed, release the guarantor, must relate to the service in which the
employee is engaged, and must be something more than mere moral
delinquency unconnected with the subject-matter of the guaranty. Ib.
120
REPORT OF THE COMPTROLLER OF THE CURRENCY.
BONDS OF OFFICERS—Continued.
11. A continuing contract, guaranteeing the fidelity of a bank cashier, inay
be revoked by the guarantors without cause, upon proper notice, but
the right must be exercised reasonably. Ib.
12. A bond of suretyship for an employee, which is to "embrace and cover
only acts and defaults committed during its currency and within twelve
months next before the date of discovery of the act or default upon
which such claim is based," covers not only embezzlements made during
the year actually preceding their discovery, but also earlier embezzlements which would have been discovered within a year but for the fact
that during the year preceding the actual discovery the employee had so
falsified the books as to prevent such discovery. Consolidation National
Bank v. Fidelity and Casualty Company of New York (CO.), 67 F.,874.
13. Plaintiff, as receiver of a national bank, sued a former employee of the
bank and a guaranty company upon a bond of indemnity, against the
fraudulent acts of such employee, which contained a provision that it
should be essential to the validity of the bond that the employee's signature be subscribed thereto. The defendants pleaded non est factum.
The bond offered in evidence was not signed by the employee of the
bank and there was no evidence that it had been executed by the defendant company. The court sustained defendants' plea, and dismissed the
suit. Held, no error. Blackmore v. Guarantee Co. of North America
et al., 71 Fed. Rep., 363.
14. A bank employee's bond, conditioned for the reimbursement of any loss
sustained by reason of fraud or dishonesty in connection with his duties,
provided that any claim under the bond should embrace and cover only
acts and defaults committed during its currency and within twelve
months next before the date of discovery of the act or default upon
which such claim was based. Held, that the bond did not cover a default
committed more than twelve months prior to its discovery, which would,
however, have been discovered within a year from its commission had
not such discovery been prevented by the act of the employee in falsifying the books during the year preceding the discovery. 67 Fed. Rep.,
874, reversed. Fidelity & Casualty Co. of New York v. Consolidated
Nat. Bank, 71 Fed. Rep., 116.
15. The cashier of a bank, whose bond, with sureties, was conditioned that he
would "faithfully and honestly discharge his duties as cashier, and
account for all such moneys, funds, and valuables" as came into his
hands, cashed a draft, payable to his order, amply secured by bills of
lading of cotton, and duly forwarded the same, with the bills of lading,
to a bank in another city for collection. The draft and bills of lading
were lost in the mail. The cashier's bookkeeper, whose duty it was to
check the statements and accounts with other banks, reported the draft
as credited on their account with the bank to which they had been forwarded, and his accounts balanced according to his report. The agent
of the railroad company, without production of the bills of lading, and
without the consent of the cashier, delivered the cotton to the consignee.
Held, that the cashier was not liable on his bond. First Nat. Bank v.
Still {Tex. Civ. App.), 32 S. W., 61.
16. The A. Surety Co. executed and delivered to the0C. bank a bond, insuring
the bank against loss by any act of fraud or dishonesty of its cashier
in connection with the duties of that office, or the duties to which, in
the bank's service, he might be«subsequently appointed, occurring during
the continuance of the bond, and discovered within six months thereafter and within six months from the death, dismissal, or retirement
of the cashier from the service of the bank. The bond provided that the
surety company should be notified of "any act" of the cashier which
might involve a loss for which the company would be responsible * * as
soon as practicable after the occurrence of such act shall have come to
the knowledge " of the bank, and it required proofs of loss to be furnished to the surety company. The bank suspended payment and passed
into the hands of a receiver who afterwards notified the surety company
of the discovery of dishonest acts of the cashier, furnished proofs of
loss, and brought suit against the surety company on the bond. The
evidence upon the trial as to the time when the dishonest acts of the
cashier were discovered being conflicting, held, that the question whether
the required notice was given with reasonable promptness was for the
REPORT OF THE COMPTROLLER OF THE CURRENCY.
121
BONDS OF OFFICERS—Continued.
17.
18.
19.
20.
jury. Held, further, that the terms of the bond did not require notice
to be given of suspicions of dishonest acts. American Surety Co. v.
Pauly. 72 Fed. Rep., 470.
The bank having suspended business on November 12, 1891, but the cashier having continued in the service of the receiver until March following, when he resigned, held, that the services so rendered by him after
November 12th were rendered to the bank none the less because its
affairs were controlled by a receiver, and the surety company was not
absolved from liability for acts discovered more than six months from
November 12th, but within six months from his resignation. Held, further, that a proof of loss under the bond, which set forth with reasonable plainness, and in a manner by which a person of ordinary intelligence could not be misled, that certain sums of money had been taken
from the bank by means of acts of the cashier, described in such proof,
was sufficient, though it failed to aver explicitly that a loss had been
caused to the bank. Ib.
The " teller's book " of the bank, which had been kept by one GL, who died
before the trial, was offered in evidence to show that on certain days no
money was received for certificates of deposit. Held, that in connection
with evidence of the course of business, by which, if received, such money
would be entered in the book, the evidence was competent, though not
conclusive. Ib.
For the purpose of showing the dealings with the bank of the president,
who was charged with haying misappropriated the bank's money with
the cashier's aid, the president's ledger account was put in evidence,
together with the testimony of the bookkeeper who made the entries,
and who swore that they were correctly made from the original deposit
slips and checks furnished to him by the teller, who had died before the
trial; that it had been the teller's duty to verify all deposit slips, and to
pay the checks; and that all such slips and checks, when reaching the
bookkeeper's hands, bore marks indicating that they had been verified
or paid by the teller. Held, that the account was competent, and sufficiently proven. Held, further, that evidence of acts of fraud and dishonesty by the cashier, occurring before the date of the bond, and for
which no claim was made against the surety company, but which were
similar to the acts on which the claim was based, was admissible to show
that the acts on which the claim was based were intentional, and not
merely negligent, or due to oversight. Ib.
Prior to the issue of the bond sued on the cashier and president of the bank
had conspired to rob it, and had been engaged in fraudulent practices.
When application was made for the bond the surety company required
a certificate from the bank of the cashier's good character. Such certificate was made by the president without, so far as appeared, any direct
authority from the board of directors, or any knowledge by them that
such certificate was made or required. Held, that the president's knowledge of the cashier's dishonesty was not to be imputed to the bank, so
as to make it responsible for the misrepresentations contained in such
certificate. Ib.
BOOKS, INSPECTION OF:
1. Code of Alabama, 1886, sec. 1677, which provides that stockholders of all
corporations have the right to have access to and inspection,and examination of the books, records, and papers of the corporation at all reasonable and proper times, applies to national banks located within the State;
and mandamus will lie against the officer having custody of the books
to enforce the right. Winter v. Baldwin, 7 So., 734; 89 Ala., 483.
2. The rights of stockholders are not curtailed nor the statute in conflict with
U. S. Rev. St., which provide that national banks shall'not be subject
to visitorial powers other than those authorized by Congress or vested
in the courts of justice. Ib.
3. The officers of a national bank can not be compelled to exhibit the books
of the bank to State officers for the purpose of furnishing a basis for
State taxation of the deposits as against the depositors. First National
Bank of Youngstown v. Hughes et ah; Second National Bank v. Same,
8N.B. C, 176.
122
REPORT OF THE COMPTROLLER OF THE CURRENCY.
BRANCH BANKS:
1. A national bank located in another State can not keep an office for discount and deposit in New York, and can not maintain an action upon
a note discounted at such office. National Bank of Fairhaven v. The
Phoenix Warehousing Co., 6 Hun., 71; 1 N. B. C, 784.
2. Under Rev. St., sec. 5190, providing that "the usual business of each
national banking association shall be transacted at an office or banking
house located in the place specified in its organization certificate," a
national bank can not make a valid contract for the cashing of checks
upon it at a different place from that of its residence, through the
agency of another bank. ^.4rmstrong v. Second National Bank of Springfield, 88 Fed. Bep., 883.
BROKER:
A national banking association is not authorized to act as a broker or agent
in the purchase of bonds and stocks. First National Bank of Allentown
v. Hoch, 80 Penn. St., 324; Weckler v. The First National Bank of Hagerstoivn, 42 Md,, 5S1.
See Shareholders; Transfer of stock.
1. A national bank can acquire an interest in its own stock only by purchase
to prevent a loss upon a debt previously contracted in good faith; and a
provision in certificates of stock in such bank that they shall not be
transferred until all the liabilities of the stockholder to the bank are
paid is void and of no effect. Conklin y. The Second National Bank. 45
N. F.? 655; 1 N. B. C, 60S.
2. Where a national bank made a loan upon the pledge of its own shares and
afterwards sold the shares to obtain payment of the loan which exceeded
the amount realized from the shares. Held, that the owner of the shares
could not on the ground that the statute forbids a national bank to take
its own shares as security recover from the bank the amount realized
upon the sale of the shares. First National Bank of Xenia v. Stewart,
107 U. S. 676; 3 N. B. C. 06.
8. The articles of association and the by-laws of a national bank prohibited
the transfer of stock owned by any stockholder indebted to the bank
until such indebtedness should be satisfied. Held, that the prohibition
was invalid, under section 35 of the national banking act, and that the
bank could not thus acquire a lien on the shares of the stockholders.
Bullard v. Bank, 18 Wall., 580; 1 N. B. C, 03.
4. The right of creditors to look to unpaid portions of the capital stock as a
fund for the payment of their claims is not created by State statutes,
but is derived from general principles of law. The enforcement of such
right, therefore, is not dependent upon remedies provided by State legislation; and if it appear that the State has. by statute, provided legal
remedies for the enforcement of equitable rights, the creditor may, at his
election, when proceeding in a Federal court, adopt the form of remedy
appropriate in courts of equity, or may sue at law, under the statute.
First Nat. Bank of Sioux City v. Peavey, 60 Fed. Bep., 455.
5. The question whether the right of a creditor to look to unpaid capital stock
is legal or equitable in its nature, in any particular case, is to be determined, it seems, by the following principles: If a person has subscribed
for or purchased the stock under such circumstances that the corporation
itself, and through it, its creditors, can call upon the stockholder for the
unpaid portions of the stock, then this claim is one at law, based upon
the express or implied terms of the subscription or purchase. If, however, by the terms of the original subscription or purchase, no liability is
assumed to make any further payments to the corporation on this stock,
and it is agreed between the corporation and the stockholder that the
stock shall be considered as full paid, then a creditor's right to look to
unpaid portions of the stock is equitable, and can not be enforced by
action at law, unless so provided by statute. Ib.
6. The A. Co. was organized with a capital of $1,000,000, in 40,000 shares, of
§35 each, all of which were subscribed for by the eight incorporators of
the company. No cash was paid on the subscriptions, but property,
valued at $220,000, was conveyed to the company in payment for the
stock, without application to any specific shares. Immedia f ely after the
organization of the company it was agreed by all the subscribers, at a
stockholders' meeting, that 16,000 shares should be contributed by the
CAPITAL STOCK.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
Ses Shareholders; Transfer of stock—Continued.
subscribers to secure working capital, and that such shares should be
issued to trustees, who were authorized to sell the same as full paid and
nonassessable stock, at not less than $3 per share, two-fifths of the proceeds to be paid to the incorporators and three-fifths into the treasury
of the corporation. It did not appear that enough of the stock so contributed was sold to equal $.220,000 at par value; but defendant purchased froni one W., who was engaged on behalf of the company in
selling the stock, 800 shares, in the belief that they were owned by W.,
and were fully x>aid, as they were stated on their face to be, having no
knowledge or notice of the transactions leading to the sale of the stock
or of the facts in regard to its payment. Afterwards, the company having become insolvent, a receiver of its property sued defendant for the
amount of an assessment of $15 per share on the subscriptions to the
stock. Held, that the proceedings for the sale of the stock, as full paid,
must be construed as an appropriation, by the shareholders and the corporation, of the unapplied credit of $220,000 to the 16,000 shares contributed for sale, or to such of them as should be issued; and as it did
not appear that enough of the stock was sold to equal the $220,000, the
stock purchased by defendant, in the belief that it was full paid, must
be treated as being so in fact, and, accordingly, the defendant was not
liable for the assessment. Roodv. Whorton, 74 Fed, Rep., US.
Where suit is brought in equity to enforce subscriptions to the capital
stock of a corporation as part of a trust fund for the benefit of the creditors of such corporation, the bill must ba so framed as to be for the
benefit of all the creditors who are entitled to the trust fund. First
Nat. Bank v. Peavey (0. C), 75 F., 154.
National banks have no authority to increase their capital stock except
as provided by Rev. St., sec. 5142, and act of Congress May 6,1886; and
where an increase is attempted to be made without obtaining the consent of two-thirds of the stock, the payment in full of the amount of
such increase, and the certificate and approval of tha Comptroller of the
Currency, as required by those statutes, the proceedings are invalid, and
preliminary subscriptions to such increase can not be enforced. Winters
v. Armstrong; Armstrong y. Stanage; Samcv. Wood, 37 Fed. Rep., 60S.
Such a subscription is impliedly conditioned on the subscription of the
whole amount of the proposed increase and on the compliance by the
corporation with all the requirements of the statute necessary to make
th3 increase stock valid, and in case of non-compliance with such requirements there is a failure of consideration. Ib.
In an action by the receiver of a national bank to enforce subscriptions to
a proposed increase of its capital stock, an allegation that the bank, subsequent to defendants' subscriptions, and with their knowledge, represented to the public by means of circulars, letter heads, etc., that its
capital stock had been so increased and that defendants allowed their
names to remain '' upon the list of those subscribing for and entitled to
such new or increase of stock," but without alleging that the public
gave credit to the bank on the faith that the defendants were part
owners of such increase of stock, or that they allowed themselves to
be held out as actual stockholders, does not show that they are estopped
to plead the failure of the bank to comply with the statutory requirements in perfecting such increase. Ib.
The receiver stands in the shoes of the bank, and can assert no rights
against the subscribers which the bank could not have asserted. Ib.
A subscriber who has made payments on his subscription to the proposed
increase, believing that the statutory requirements would be complied
with, is entitled to have the amount thereof allowed as a claim against
the assets of the bank in the receiver's hands. Ib.
Where one subscribes for shares in the increase of the capital of a national
banking association in a certain amount, such subscription being paid
in full and the entry made on the stock book of the bank, he becomes a
shareholder, although no stock certificate is issued. Pacific N. B. v.
Eaton, 141 U.S., 227.
And the certificate of the Comptroller of the Currency approving the
amount of increase that has been paid in, which amount includes what
was paid by the dissenting subscriber, will be conclusive upon such
subscriber. Ib.
CAPITAL STOCK.
7.
8.
9.
10.
11.
12.
13.
14.
123
124
REPORT OF THE COMPTROLLER OP THE CURRENCY.
See Shareholders; Transfer of stock—Continued.
15. But if such subscriber has assented to or ratified the change he will be
held a shareholder. Delano v. Butler, 118 U. S., 634.
16. When the previous proceedings looking to an increase in the capital stock
of a national bank have been regular and all that are requisite, and a
stockholder subscribes to his proportionate part of the increase and pays
his subscription, the law does not attach to the subscription a condition
that it is to be void if the whole increase authorized be not subscribed,
although there may be cases in which equity would interfere to protect
him in case of a material deficiency. Aspinwall v. Butler, 133 U. S., 595.
17. The Comptroller of the Currency has power by law to assent to an increase
in the capital stock of a national bank less than that originally voted by
the directors, but equal to the amount actually subscribed and paid for
by the shareholders under that vote. Ib.
18. Where one subscribes for shares in an increase of capital stock of a national
bank and pays for the same without waiting to see whether the whole
amount of the increase is taken, he is bound by such subscription and
payment, though the amount of the increase is afterwards reduced by the
bank and the Comptroller of the Currency. Butler v. Eaton, 141 U. S.,
240.
19. The conditions imposed by Rev. St., sec. 5142, as to the validity of increase
of national-bank capital were intended to secure actual cash payment of
subscriptions and to prevent watering stock, not to invalidate bona fide
subscriptions actually made and paid. Aspinwall v. Butler, 133 U. S.,
595.
20. Stockholder in national bank who, with knowledge of its insolvent condition and of all material facts, subscribes for increased stock to same
amount as his original stock, and amount of proposed increase is afterwards reduced, can not question validity of proceedings for such increase
to annul such subscription and payment. Delano v. Butler, 118 U. S.,
634; Pacific National Bank v. Eaton, 141 ib., 227; Thayer v.Butler, ib.,
234; Butler v. Eaton, ib., 240.
21. There can be no increase of the capital of a national bank until the Comptroller of the Currency approves thereof and issues his certificate, as
provided by section 13 of the act of Congress providing for the organization of national banks. Charleston v. People's National Bank, 5 South
Carolina, 103; 1 N. B. C, 898.
22. The stockholders of the C. National Bank voted to increase its capital
$300,000, and M. subscribed and paid for 23 shares of the proposed
increase. Only §150,000 of such proposed increase was ever paid for,
and the directors applied to the Comptroller of the Currency to approve
the increase to the amount of §150,000, which was refused. Afterwards
the stockholders voted an increase of §150,000, and applied for approval
thereof, which was refused; but later the Comptroller, on his own
motion, on the eve of the bank's insolvency, approved this increase. M.
sued the bank and its receiver to recover the amount paid by him under
his subscription to the first proposed increase. Held, that the Comptroller's refusal to approve the first increase to the extent of §150,000,
nullified the vote for the increase and M.'s subscription to the stock,
leaving him in the position of a creditor of the bank for the amount paid
in, and the subsequent proceedings, he not having participated therein,
could not reanimate his contract of subscription. Matthews v. Columbia
Nat. Bank of Tacoma et al., 77 Fed. Rep., 372.
23. Where a vote by the stockholders of a bank to increase the capital stock
to a certain amount never became effective because only one-half the
proposed increase was subscribed and paid for, the board of directors
was not authorized to cancel one-half the proposed additional stock
which had not been subscribed for, nor to give the assent of the corporation to an increase to any amount, the shareholders alone being
authorized to determine whether there should be any increase, and to
fix the amount. And a stockholder who subscribed and paid for new
stock issued under the original plan is entitled to recover back the
amount thus paid, even though there was afterwards a valid vote of the
stockholders to increase the stock to the smaller amount, as he never
assented to a subscription for stock under the new plan.—Mattheivs v.
Columbia Nat. Bank et al., 79 Fed. Rep., 558.
24. Where the articles of association of a bank provided that meetings of
shareholders might be called by the board of directors, or by any three
CAPITAL STOCK.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
125
CAPITAL STOCK. See Shareholders; Transfer of stock—Continued.
shareholders, a resolution carried at a meeting called by the president
and cashier was not a valid act of the corporation, all the shareholders
not being present. Ib.
25. A stockholder in a corporation is not estopped from questioning the validity of a stockholders' meeting by reason of his participation in the proceedings by proxy, as his agent was only authorized to act at lawful
meetings. Ib.
26. Under the national banking law (Rev. St., § 5142), and the amendment of
May 1,1886 (24 Stat., 18), the action of the Comptroller of the Currency
in approving of an increase in the capital of a national bank, and certifying that the amount thereof has been paid in, is conclusive, and the
validity of the increase can not be assailed in a collateral proceeding such
as an action to enforce the liability of the stockholders. Latimer v.
Bard et ah, 76Fed. Rep., 536.
27. Where the capital of a national bank has been increased, and defendants
have received their additional stock, and for several years held themselves out as stockholders, they can not, when the bank becomes insolvent and they are assessed to pay its indebtedness, deny their liability
upon the ground that the increase of capital was fraudulent, and that
they could not have discovered the fraud with ordinary care. More
diligence was required of them, and they are estopped by their laches.
Upton v. Tribilcock, 91 U. 8., 45, and Banger v. Upton, id., 64, foh
loived. Ib.
28. The officers, in taking the necessary steps for such increase, act as the
agents of the stockholders, and such stockholders can not set up the
fraud of the officers concerning the increase to defeat the claims of innocent creditors. Ib.
29. Under the United States statutes, national banks have the abstract power
to increase their capital to such a limit as may be approved by the Comptroller of the Currency, and where stockholders have* assented to an
increase they can not set up any defects or irregularities in the exercise
of the power as a defense in an action to enforce their liability. Chubb
v. Upton, 95 U. S., 665; Veeder v. Mudgett, 95 N Y., 295, followed. Scovill v. Thayer, 105 U. S., 143,and Implement Co. .v. Stevenson, 13 C. C. A.,
661, 66 Fed., 633, distinguished. JLb.
30. A national bank reducing its capital can not retain, as a surplus or for any
other purpose, any portion of the money which it received for retired
stock, and having refused to permitjshares thus retired to be transferred
on its books, is liable for the value of the shares to the holder. Seeley*v.
Neiv York National Exchange Bank, 78 N. Y., 608; 4 Abb. New Cases,
61; 2N. B. C.,340.
31. The capital of a national bank having become impaired by the nonpayment
of the interest on some paper among its assets to the amount of $71,000,
in order to avoid an assessment by the Comptroller the stockholders
reduced its capital stock and earned the bills and notes to the account of
suspended or '' bad debts," which were not thereafter included as assets,
although retained in its custody. Some years afterwards the bank realized $75,000 from collaterals pledged for the security of that paper. In
a suit by a stockholder to recover his share of the amount realized proportioned to the amount of stock surrendered. Held, that he could not
recover. IfcCann v. First National Bank of Jeffersonville, 112 Ind., 354;
3N.
B.Cm32. Under Comp. Laws, sees. 3589,4515, relating to the rescission of contracts
procured through fraud, one induced to purchase bank stock by fraudulent representations as to its value may rescind the purchase and recover
his notes given therefor against a holder of the notes having notice of
the fraud. Taylor v. National Bank (S. D.),62 N. W., 99.
33. The State legislature may authorize the sale under execution of nationalbank stock. In re Braden's Estate^ 30 A,, 746; Appeal of Wood, Ib.
GASHIER.
See Officers.
CERTIFICATE OF DEPOSIT:
1. National-banking associations may issue certificates of deposits. Riddle
v. First National Bank, 27 Fed. Rep., 503.
2. Certificates of deposit in the ordinary form issued by a national bank to
depositors and payable to order are not post notes within the prohibition of sec. 5183, Rev. St. Ib.
126
REPORT OF THE COMPTROLLER OP THE CURRENCY.
CERTIFICATE OF DEPOSIT—Continued.
3. A certificate of deposit, payable to the order of the depositor on the return
of the certificate, is not due OF suable until demand made and return of
the certificate. Ib.
4. Certain persons, directors of a savings and of a national bank, procured
money from the former on notes made by a third person to them for the
payment of stock of the national bank issued in the name of such third
person for their benefit. These persons were behind in their accounts
with the national bank, and the savings bank allowed them to overdraw
their accounts with it to a large amount, which was used in settling
their accounts with the national bank. Thereafter the savings bank
delivered the notes and the check to the national bank, which issued to
it a certificate of deposit for an amount covering the whole amount represented by them. Held, that this certificate of deposit was without
consideration and void, and any loss accruing to the savings bank by
virtue of the transactions was due to the fraud or incompetency of its
own officers. Murray v. Pauly, 5G Fed. Rep., 9G2.
5. A certificate of deposit is evidence of so high and satisfactory a character
as to the sum deposited, that to escape its effect the maker must overcome it by clear and satisfactory evidence. Where the testimony, aside
from the certificate, is balanced as to the amount deposited, the certificate will turn the scale. The First National Bank of Laeon v. Myers,
83 III., 507.
6. A certificate of deposit issued by a national bank, payable to the order of
the depositor on return of the certificate properly indorsed and understood between the bank and the depositor not to be payable until a future
day agreed upon, is not in violation of the national-banking act. Bunt*
Appellant, 141 Mass., 515; 3 N. B. C., 474.
7. Suit against a bank upon a stolen certificate of deposit given by the defendant to the plaintiff, reciting that he had deposited in said bank a certain
number of dollars, payable to his order in current funds on the return
of the certificate properly indorsed. Held, that the instrument should
be regarded as the promissory note of the bank, assignable under the
statute, but that it was not negotiable as an inland bill of exchange,
being made payable, not in money, but "in current funds." The
National State Bank of Lafayette v. Ringel, &/ Ind., 393.
8. Held, therefore, that the payee could recover on said stolen certificate without giving a bond to indemnify the bank against a subsequent claim
thereunder by another person. Ib.
9. A person depositing money in a bank accepted from the cashier a certificate
of deposit, which made no mention of interest, but with a verbal agreement that interest should be paid. The cashier at the same time indorsed
a memorandum of the rate of interest on the stub from which the certificate was taken. Held, that the stub should be read with the certificate,
as evidence of the entire contract. Thomson v. Beal, 48 Fed. Rep., GI4.
10. A bank, on receiving certain notes as a special deposit, issued a certificate
for the amount of the notes, made out a printed form.' from which the
words "in current funds" were erased, and the words "in certain
notes" substituted. The certificate was marked "Special deposit."
Having been transferred, this certificate was sent by the holder to the
bank for payment. The notes had not then been collected, and the
cashier was directed to return the certificate, but, as the signature was
torn, he was instructed to prepare and transmit a duplicate. In doing
so he carelessly omitted to change the printed form by erasing "in
current funds" and substituting "in certain notes." Held, that there
was no ground for a claim that the second certificate was given in payment of the first, that it was only a substitute for it, and that the
receiver of the bank was only required to surrender to the holder the
notes constituting the special deposit, for which the original was issued.
NiblaeJcY. Coder, 74Fed. Rep., 1000.
11. Knowledge by a member of a firm of the true consideration of a certificate
of deposit, which the firm discounted with a bank, and which had been
negligently altered in making out a duplicate, held, to be the knowledge
of the bank, where such member was also its cashier, and, as such, acted
as the sole representative of the bank in discounting the certificate. Ib.
12. The defendants unlawfully detained a certificate of deposit of the value of
§2,000 from the plaintiff. Held, that the plaintiff was entitled to recover
damages for such detention equal to legal interest on the value of the
REPORT OF THE COMPTROLLER OF THE CURRENCY.
127
CERTIFICATE OF DEPOSIT—Continued.
certificate from the date of the demand therefor and refusal to the recovery, and this without any evidence that the plaintiff would have converted said certificate into money and put it to use, other than his right
to do so and the defendants' illegal prevention of the exercise of such
right. Slepjiy v. Bank of Commerce and others, 17 Fed. Rep., 712.
CERTIFICATION OF CHECKS: See Collections.
1. A national banking association may "certify" a check. Merchants*
National Bank v. State National Bank, 10 Wall., 604.
2. The certification of a check by a bank is, in affect, merely an acceptance,
and creates no trust in favor of the holder of the check and gives no lien
on any particular portion of the assets of the bank. People v. St. Nicholas Bank, 28 N. Y. St., 407; 68 N. Y. St., 712.
3. A certified check has a distinctive character as a species of commercial
paper, the certification constituting a new contract between the holder
and the certifying bank. The funds of the drawer are. in legal contemplation, withdrawn from his credit and appropriated to the payment of
the check, and the bank becomes the debtor of the holder as for money
had and received. National Commercial Bank v. Miller & Co., 77 Ala.,
168.
4. Where the defendant has a right of election, on account of a tort committed, either to sue for the tort, or, waiving the tort, to sue for money
had and received, the relation of debtor and creditor does not exist until
he elects to sue for the money; and his creditors can not defeat his election by garnishment against the wrongdoer. But this principle does not
apply where the garnishees, having received a check from the defendant,
with authority to collect for deposit and use, have had the check certified by the bank on which it is drawn, before the service of the garnishment; being authorized to have it certified, and the relation of the
parties being thereby changed, they are liable to the defendant for the
amount of the check, as for money had and received, and that liability
may be reached by garnishment. Ib.
5. A broker received coupon railroad mortgage bonds to cover future margins
of a customer and pledged them to a bank as collateral security for any
indebtedness he might owe to it. Afterwards the bank advanced money
and certified checks on the faith of these bonds, when broker did not have
money on deposit equal in amount to the checks. Held, under sec. 5.208,
that although the certifications were unlawful the checks certified were
good and valid obligations against the bank. Thompson v. St. Nicholas
National Bank, 146 U.S..240.
6. In an action by a bona fide holder of a check drawn on defendant, a
national bank, and certified by its cashier. Held, that the defendant
was liable, although the drawer had no funds in the bank when the
check was certified. Cooke v.The State National Bank of Boston, 52
N Y., 96; 1 N. B. C., 60S.
7. "Where a postdated check is certified by the cashier of the bank on which
it is drawn to be "good," by indorsement thereon before the day of its
date, the instrument, upon its very face, communicates facts and information to persons receiving the same that the cashier, in making such
certification, was not acting within the known limits of his power, and
that he was clearly exceeding them. Tlie Clarke National Bank v. The
Bank of Albion, impleaded, etc., 52 Barb., 592.
8. It appearing, on the face of such paper, that it was certified by the cashier
before its payment could have been legally demanded, and before it
could be presumed that the drawer had made a deposit for its payment,
this is, in the law, full notice to a purchaser. Ib.
9. To enable a holder of such check to recover of the bank upon it, it must
appear that he became the owner and holder in good faith for a full and
fair consideration in the usual course of business, and without notice of
the cashier's want of power to make the certification. He must have
parted with something of value upon the strength and in consideration
of the transfer of the paper. Ib.
10. If he parted with nothing before the check was dishonored, he stands in
privity with his immediate indorsers, and is affected by all that will
affect them. Ib.
11. Crediting the indorsers with the avails of the check on the books of the
holder is in no sense a paying over. The holder, upon receiving notice
128
REPORT OF THE COMPTROLLER OF THE CURRENCY.
See Collections—Continued.
of dishonor, has an undoubted right to erase such credit, and to restore
it only at the special instance of the indorsers from whom he received
the check. Ib.
12. The receipt of a certified check is not, of itself, payment. Such a check
does not cease to be commercial paper and become money. Certifying
a check to be " good " is nothing more than a promise by the bank upon
which it is drawn to pay it when presented, as in the case of the acceptance of the bill of exchange. If an accepted bill be protested for nonpayment, and the drawer duly notified thereof, he is bound to pay the bill,
with damages and costs. The same is the law with regard to a certified
check. Bickford v. First National Bank of Chicago, J$ III., 238.
13. As the acceptance of a bill of exchange does not discharge the drawer, so
neither should the acceptance of a check, manifested by the word
"'good" placed upon it by the bank, discharge the drawer. They rest
on the same principles. In this respect there is no difference between
an uncertified and a certified check; the dishonor of either must make
the drawer liable. Ib.
14. There is this difference, however, between a certified and an uncertified
check: In case of the former, the amount of the check is supposed to be
at once charged up against the drawer, and thus placed beyond his control, while the holder of an uncertified check may be anticipated by
another, who also holds a check on which he may draw the money. The
certificate is an unconditional promise on the part of the bank to pay the
check on demand. The object in certifying the check is to give it a
currency value and to enable the holder to use it as money. Ib.
15. Although it be the fact that certified checks pass from hand to hand as
cash," still they are not cash or currency, in the legal sense of those
terms, and they do not lose, on that account, any of their characteristics
as bills of exchange, and therefore, when dishonored, the holder has a
right to look to the drawer for payment. Ib.
16. In this case a check was drawn and certified and deposited in a bank after
10 o'clock a. m., and before 3 o'clock p. m., on a certain day, where it
remained until the next morning, when it was taken, in the usual course
of business, to the bank on which it was drawn. The bank was closed
and continued so. The check was protested for nonpayment and due
notice given. This was sufficient diligence to hold the drawer. Ib.
17. The holder of a certified check has the right to hold the drawee and
acceptor, as well as the drawer. So, where the acceptor has failed and
made an assignment, the holder waives none of his rights against the
drawer by giving notice to the assignee of the acceptor not to pay over
any money to the drawer out of assets which might come to his hands
in that capacity. Ib.
18. A certificate of a bank that a check is good is equivalent to an acceptance;
it implies that a check is drawn upon sufficient funds in the hands of the
drawee; that +hey have been set apart for its satisfaction, and that
they shall be so applied whenever the check is presented for payment.
Merchants' National Bank v. State National Bank, 10 Walt, 604;
1 N B. C, 47.
19. National banks have the power to certify checks, and this power may be
exercised by the cashier without special authorization. The directors
may limit his exercise of this power as they deem proper, but such limitation will not affect a person ignorant thereof who deals with the
cashier in relation to matters apparently within the scope of his
power. Ib.
20. A bank, knowing that the county treasurer of the county had not sufficient
county funds in his hands to balance his official accounts, consented to
give him a fictitious credit in order to enable him to impose upon the
county commissioners, who were about to examine his accounts. They
accordingly gave him a "cashier's check-" for $16,571.61, which he
Indorsed and took to the commissioners. They received it, but refused
to discharge him or his bondsmen, and placed the check and such funds
as he had in cash in a box and delivered them to his bondsmen. The
latter deposited the money and the check in another bank in the same
place, wnich bank brought suit against the bank which issued the check
io recover upon it. Held, 1, that the circumstances under which the
check was issued were a plain fraud upon the. law, and also upon the
county commissioners; 2, that their receipt of it and turning it over to
CERTIFICATION OF CHECKS:
REPORT OF THE COMPTROLLER OF THE CURRENCY. 129
CERTIFICATION OF CHECKS: See Collections—Continued.
the sureties was a single act, intended to assist the sureties in protecting
themselves, and was inconsistent with the idea of releasing them from
their obligation. Thompson v. Sioux Falls National Bank, 150 U. S., 231.
21. Though the drawer of a check, before delivering it, has it certified, he will
not be relieved from liability thereon, the bank having failed before
payment thereof, though presented in due season. Randolph National
Bank v. Hornblower et til., 35 N. E., 850; 160 Mass.,401.
22. Where the drawer of a check, before delivering it to the payee, has it certified as good by the bank upon which it is drawn, and the payee presents it in good season for payment, and gives due notice to the drawer
of its nonpayment, and the bank had failed at the time of presentment
for payment, the drawer will not be discharged from liability on the
check. Cincinnati Oyster and Fish Co. v. National Lafayette Bank, 36
AT Mi.,
IP OOO.
QQQ
iV.
23. As a general rule the certification of a check in the hands of the payee,
the body of which is unaltered, releases the drawer from further liability and creates a direct liability from the bank to the payee, while
as between the bank and the drawer it operates as a payment, to that
extent, on his account; and although prior to its being certified the
check may be countermanded by the drawer, after its certification it
has passed beyond his control and he no longer has power to countermand its payment. Meridian National Bank of Indianapolis v. First
National Bank of Shelbyville, 34 N E., 608; 7 Ind. App., 322.
24. The indorsement of a check by the person to whom it was actually issued,
and by whom the drawer intended the money should be received, is an
effectual indorsement to pass title to the check to a bank cashing the
same; and the indorsement is not, as to such bank, invalidated by reason of the payee acting under an assumed and fictitious name when he
was not impersonating any other individual. Ib.
25. A bank cashing, in good faith, a check so drawn and indorsed may collect
the amount thereof of the bank which has certified the same. Ib.
26. The acceptance or certification of a bank check does not warrant the signatures of the indorsers to be genuine. First National Bank v. Northivestern National Bank (III.),38 N. E., 739.
27. The certification by a bank of a note made payable at such bank, where the
maker keeps an account, is an absolute promise by the bank to pay
such note, not as the debt of another, but as its own obligation, entitling
the holder to suspend any remedy against the maker and relax steps to
charge an indorser, and can not be rescinded by the bank because made
under a misapprehension of fact as to the sufficiency of the maker's
account to meet the note. Riverside Bank v. First Nat. Bank of Shenandoah, 74 Fed. Rep., 276.
28. The payment of a note by the bank at which it is made payable, although
made under misapprehension of the state of the maker's account with
the bank, concludes the bank as against the holder of the paper who has
surrendered it, and the payment can not be recovered back of the
holder. Ib.
CHECKS: See Certification of checks; Collections.
1. A check is, substantially, an inland bill of exchange, and the rules applicable to such bills are alike applicable to checks. Bickford v. First National
Bank of Chicago, 42 III., 238.
2. The check of a depositor upon his banker, delivered to another, for value,
transfers to that other the title to so much of the deposit as the check
calls for, which may again be transferred by delivery, and when presented
at the bank the banker becomes the holder of the money to the use of the
owner of the check, and is bound to account to him for that amount,
provided the drawer has funds to that amount on deposit, subject to his
check, at the time it is presented. These checks are received and passed
and deposited with bankers as cash, subject, of course, to be made good
if not paid on presentation. This is the legal effect of an ordinary uncertified check. Ib.
3. In order tofixthe liability of the drawer of an inland bill of exchange or
Gheck, in case of nonpayment, the holder should present the bill or check
to the person or bank on which it is drawn, within business hours of the
day next succeeding the receipt of the paper, and give notice of the dishonor to the drawer. Ib.
H. Doc. 10
9
130
REPORT OF THE COMPTROLLER OF THE CURRENCY.
See Certification of checks; Collections—Continued.
4. In the case of a deposit of a check drawn upon itself the bank becomes at
once the debtor of the depositor, and the title to the deposit i>asses to the
bank. Oddieet ah v. The National City Bank of Neiv York. 45 JV. Y., 735.
5. Where a depositor draws his ch&ck on his banker, who has funds to an equal
or greater sum than his check, it operates to transfer the sum named to
the payee, who may sue for and recover the amount from the bank, and
a transfer of the check carries with it the title to the amount named in
the check to each successive holder. The Union National Bank v. The
Oceana County Bank, SO III, 212.
6. After a check has passed into the hands of a bonafideholder it is not in the
power of the drawer to countermand the order of payment. Ib.
7. An instrument drawn by a depositor on a bank, in the following form,
after giving the date and the name of the bank, "Pay to A. and B., for
account of C. & Co., ten hundred and eighteen 23-100 dollars," and signed
by the depositor, is a valid bank check, and will operate to transfer to
the payees an amount of the drawers' funds on deposit equal to the sum
named on its face. The words "for account of C. & Co." do not change
its character as a check. A bill or note without at all affecting its
character as such may state the transaction out of which it arose, or the
consideration for which it was given. The Ridgely National Bank v.
Patton & Hamilton, 109 III. 479.
8. A bank check, payable to attorneys on account of a debt due from the
drawers to the clients of the attorneys, vests the legal title in the payee
named, as trustees for the clients, and a suit thereon against the bank
is properly brought in the names of the payees. Ib.
9. A debtor gave his check on a bank for the amount of his^ndebtedness, payable to the attorneys of the creditor, which the bank refused to pay,
alleging an agreement of the debtor to apply his deposits on other
indebtedness. It was held that the bringing of an action by the creditor
against his debtor did not estop him from bringing an action on the
check in the name of his attorneys, the payees, against the bank. Ib.
10. M., who kept an account with the M. and M. Bank of Troy, deposited with
that bank a check given for value, drawn by defendant, payable to the
order of M., and indorsed by him in blank. Said bank credited the
amount of the check in M.'s bank pass book, which was returned to him,
and on the same day it mailed the. check to plaintiff, its correspondent in New York, and its creditor, to be credited on account, and it was
so credited. M. stopped payment of the check, and when plaintiff
caused payment to be demanded of the drawee, it was refused. Notice
of presentation and protest was given to defendant, who subsequently
paid the amount to M. In an action upon the check, held, that upon
the deposit the M. & M. Bank became the owner of the check, and as
such could and did give a perfect title to its transferee, and that plaintiff was entitled to recover. The Metropolitan National Bank of Neiv
York v. Lloyd, 90 N. Y., 530.
11. The implied contract between a bank and its depositors is that it will pay
the deposits when and in such sums as are demanded, the depositor having the election to make the whole payable at one time by demanding
the whole, or in installments by demanding portions; and whenever a
demand is made by presentation of a genuine check in the hands of a
person entitled to receive the amount thereof for a portion of the amount
on deposit, and pajgiient is refused, a cause of action immediately arises,
and the statute of limitations begins to run as against the installment so
due and payable. Viets v. The Union National Bank of Troy, 101
N. Y.,563. .
12. While a check drawn by a depositor against a general bank account does
not operate as an assignment of so much of the account, it authorizes the
payee, or one to whom he has indorsed and delivered it, to make a
demand, and a refusal of the bank to pay on presentation gives the
drawer a right of action, in case he has funds in bank to meet the check,
and the refusal was without his authority. Ib.
13. It is not enough to make an equitable assignment of money on deposit in
bank that a check be drawn therefor; but where the money was deposited as the money of the holder of the check, though in the drawer's
name, and that fact is communicated to the bank before any other right
has accrued tofchefund, the same becomes in equity the property of the
holder of the check, and he may recover it from the bank. Van Allen
v. The American National Bank, 3 Lans., 517.
CHECKS:
REPORT OF THE COMPTROLLER OF THE CURRENCY.
131
See Certification of checks; Collections—Continued.
14. The holder of a check on a bank can not sue the bank for refusal to pay
it on presentation, though the drawer have sufficient on deposit to meet
it. Creveling et ah v. Bloomsbury National Bank, 46 N. J"., 265.
15. The implied engagement on the part of a banker to pay the checks of his
depositor does not inure to the benefit of the holder of a check so as to
enable him to enforce payment thereon against the bank prior to acceptance, and in the absence of assent by the banker the giving of the check
does not operate as a transfer or assignment of the debt created by the
making of the deposit. First National Bank of Union Mills v. Clark,
134 NY., 868.
16. Where it is shown to be out of a bank's course of business to receive for
collection checks drawn on it by its depositors, and a check on it drawn
by one of its depositors in favor of another is presented by the latter
and the amount thereof is credited on his pass book as a deposit, and
the check is placed on the file of paid and canceled checks, and afterwards the amount of the check is also entered to his credit and charged
against the drawer on the books of the bank, these facts constitute a
payment of the check, and the amount of it can not be withheld by the
bank on discovering that the check was an unauthorized overdraft and
the drawer was-insolvent. City National Bank of Selmav. Burns, 68
Ala., 600.
17. A charge is erroneous and properly refused which affirms, as matter of law,
that if the drawer and payee of a check are customers of the bank on
which it is drawn, the presentation of the check by the payee to the.
bank and the noting or entry of it by the bank on his pass book as a
deposit do not operate as a payment of the check, and that if within a
reasonable time the bank ascertains that the check is an unauthorized
overdraft and offers to return it there is no liability to the depositor. Ib.
18. In such case no presumption arises that the bank received the check merely
for collection and in the capacity of agent for the holder; but a presumption of payment of the check does arise and the onus of overcoming that
presumption rests upon the bank, and it can only be removed by evidence
that such was not the intention of the parties, derived from the course
of business with the depositor or from contemporaneous acts or declarations. Ib.
19. If a holder of a check, with full knowledge that the drawer is without
funds in the bank to meet it, and has no just reason to believe that the
check will be honored in the absence of funds, he is wanting in good
faith if he demands and receives payment, especially if it is known to
him that the drawer is insolvent and the bank is ignorant of the insolvency. Ib.
20. In such case, fraud being imputed to the holder of the check, knowledge
of the want of funds must be clearly traced to him. It can not be
inferred from the relations existing between him and the drawer, however intimate, unless connected with inculpatory facts or circumstances. Ib.
21. A check, drawn and delivered to the person to whose order it is payable,
does not, without acceptance by the drawee, operate as an assignment
of the sum in his hands for which it is given. It may be revoked by
the drawer at any time before acceptance, and is revoked by his death;
and there being no privity, expressed or implied, between the payee and
the drawee, the former can maintain no action on it against the latter.
National Commercial Bank v. Miller & Co., 77 Ala., 168.
22. When a bank receives from a customer a check on another bank for the
special purpose of collection, the title does not pass by the special indorsement for that purpose, nor does the receiving bank owe the amount until
the check is collected. But where the customer has a deposit account
with the bankers, on which he is accustomed to deposit checks payable
to himself, which are entered on his pass book, and to draw against such
deposits, an indorsement of the words "For deposit" on a*check so
deposited "is, in the absence of a different understanding, presumptive
of more than a mere agency or authority to collect," it is a request and
direction to deposit the sum to the credit of the customer, and gives to
the bankers authority, not only to collect, but to use the check in such
manner as, in their judgment and discretion, having reference to the
conditions and necessities of their business, may make it most available
to their protection, and they may have it certified by thet>ank on which
it is drawn. Ib.
CHECKS:
132
REPORT OF THE COMPTROLLER OP THE CURRENCY.
CHECKS: See Certification of checks; Collections—Continued.
23. When checks on another bank are handed by a depositor to the receiving
teller of a bank and are by the teller credited on the depositor's pass book,
they are only received for collection, and if not paid on presentation may
be returned and the credit in the pass book canceled. National Gold
Bank and Trust Company v. McDonald, 51 Cal., 64.
24. If a customer of a bank hands the receiving teller a check drawn by another
person upon the same bank, and at the same time hands him his pass book,
and the teller receives the check and enters a credit for the amount in the
pass book, but no entry is made on the books of the bank, and nothing else
is said or done, and the drawer has no funds in the bank, the check may be
returned to the depositor and the credit in the pass book canceled. Ib.
25. In such case a finding by the court that the check was received as a cash
deposit is erroneous. Ib.
26. The fact that the cashier of a bank upon which a check is drawn takes the
check and places it upon the "canceling fork" does not constitute such
an acceptance as will prevent him from declining to pay and returning
the same upon learning that the drawer has not sufficient funds, or if
the check is not in proper form. The National Bank of Bockvillev. The
Second National Bank of Lafayette, 69 Ind., 479.
27. Where the larceny of a bank check is charged, the question of its value is
for the jury, and it is error to instruct them that a check drawn on a
bank where the maker has funds sufficient to meet it is presumptively
of some value. Burrows v. State, 37 N. E., 271.
28. The act of Congress of March 3,1869 (Rev. St., sec. 5208), making it unlawful for national banks to certify checks unless the drawer has at the
time an amount of funds on deposit equal to the amount specified in the.
check, does not invalidate an oral acceptance of a check, or promise to
pay a check, there being at the time sufficient funds of the drawer in
possession to meet it. Fx rst National Bank v. Merchants' National Bank,
7 W. Va., 544; 1 N. B. C. 915.
29. A check drawn on a national bank was presented for acceptance, whereupon the bank promised to pay it as soon as it received information that
a certain draft left with it for collection was paid. The draft was paid
and the bank informed. Held, That the acceptance was good and binding on the bank. Ib.
30. The refusal of the bank to pay a check upon presentation gives the drawer
a right of action in case he has funds in the bank to meet the check,
and the refusal to pay was without authority. Brooke v. Tradesmen's
National Bank, 22 N. Y. St., 638; 68 Hun., 129.
31. The measure of damages will be the amount of actual loss the party has
sustained, which may fairly and reasonably be considered as naturally
arising from the breach of the contract, according to the usual course
of things. Ib.
32. The ordinary amount of damages in such case would be the amount of
check, interests, and costs. Ib.
33. The immediate entering of a judgment against the drawer, and the seizure
of his business by the sheriff, in consequence of the failure of the bank to
pay the check, is not an injury for which the bank would be liable. Ib.
34. The term " protest," as applied to inland bills of exchange, includes only
the steps essential to charge the drawer and indorser. Wood River Bank
v. First National Bank of Omaha, 55 N. W;, 239; 36 Neb., 744.
35. Bank checks in the country are regarded as Inland bills of exchange, for
the purpose of presentment and demand and notice of dishonor, and do
not require a formal protest in order to charge the indorsers. Ib.
36. They are also due upon presentation and not entitled to days of grace. Ib.
37. A check operates as an equitable assignment pro tanto from the time it is
drawn and delivered, as between the drawer and the payee or holder.
Hidings v. Hidings Lumber Company et ah, 18 S. E., 620; 38 W. Va.,851.
38. A general assignment for the benefit of creditors does not defeat the check
holder, although the check be not presented to the bank for payment
until after such assignment. Ib.
39. In the absence of proof to the contrary, it will be presumed that the name
of the payee appearing in a check was written in when the check was
signed. Fifth National Bank v. Central National Bank (Sup.), 31
N. Y. S., 541.
40. Evidence of a custom of passing checks payable to a person " or bearer"
by delivery only does not affect the operation of Code, sec. 1761, requir-
REPORT OF THE COMPTROLLER OF THE CURRENCY.
133
CHECKS: See Certification of checks; Collections—Continued.
ing such checks to be construed as payable to a person " o r order."
First National Bank v. Nelson {Ala,), 16 So., 707.
41. Where a person deposits in bank money held by him in a fiduciary capacity,
mixing it with his own moneys, and afterwards draws checks against
his account, such checks will be applied first to the moneys belonging
to the drawer; and in such case the rule that checks will be applied to
the deposits in the order in which the deposits were made does not apply.
Heidelbach v. National Park Bank (Sup.), 33 N. Y. S., 794.
42. Where a bank, in consequence of an error, fails to pay a depositor's check
when presented, but discovers the error and pays the check five days
later, the depositor can recover only nominal damages against the bank.
Burroughs v. Trademen's National Bank (Sup.), 33 N. Y. S., 864.
43. A tender of bank checks payable in sixty and ninety days is not a tender
of payment. Cady v. Case (Wash.), 39 P., 375.
44. A check, unless objected to, is a sufficient tender. Wright v. Robinson et
al.,32 N. Y.S.,463.
45. The crediting by a bank of the amount of a check to the account of a
depositor indebted to it does not make the bank a bona fide holder for
value of the check. First National Bank v. Nelson (Ala.), 16 So., 707.
46. The indorser of an ordinary check is released from liability thereon where
the indorsee might have presented the check for payment within twentyfour hours, but sent the same by a circuitous route, so that it was not
presented until five days, when payment was refused. 55 N. W., 106 4; 37
Neb., 500, affirmed; First National Bank v. Miller (Neb.), 62 N. W., 195.
47. The indorsement of a bank draft by the payee to the order of a fictitious
person in good faith, and believing him to be real, is not in law an
indorsement to bearer, such not being the intention of the indorser; and
the indorsement of the name of the fictitious indorsee by a third person
without authority is a forgery, and does not protect the bank in payment
of the draft. Chism v. First Nat. Bank (Tenn. Sup.), 36 S. W., 387.
48. A bank can not refuse to cash a check, although it knows that the check
was drawn in payment of a bet made in violation of a law on the result
of an election; and the fact that a check was so cashed is not ground on
which the drawer can recover the amount from the bank. McCord v.
California Nat Bank (Cal.), 31 P., 51.
49. The giving of a check by a bank depositor for the full amount of the deposit
does not operate as an assignment to the holder of the check, so as to
enable him to enforce payment thereon against the bank prior to its
acceptance of the check. First Nat. Bank v. Clark (N. Y. App.), 32
N.E.,38.
50. Title to a check payable to H. B., intended for N. B., can not be obtained
• under indorsement by H. B., made fraudulently, though the indorsee be
deceived and pay value. Sioux Valley State Bank v. Drovers' Nat. Bank,
58 III. App., 895.
51. Where a bank discounts a draft in advance of its acceptance, it is not a
bona fide holder for value unless it has funds in its hands which it
releases or fails to withhold from the drawer because of the acceptance.
First Nat. Bank v. Wills Creek Coal Co. (Mich.), 68 N W., 232.
52. The holder of a check can not sue the bank on which it is drawn until
such check is accepted by the bank. Commercial Nat. Bank v. First
Nat. Bank (N. C.),24 8. E., 524.
53. A stipulation, stamped on the face of a check, that it will not be paid to a
certain company or its agents, is valid. Ib.
54. A draft was drawn payable to the order of the drawer, and by it indorsed
specially to the defendant corporation, and by defendant indorsed in
blank, and cashed by the plaintiff bank for another corporation, whose
indorsement was written above the indorsement of the defendant. Held,
that the position of the indorsements was not notice to plaintiff that
defendant was an accommodation indorser. Marshall Nat. Bank v,
O'Neal (Tex. Civ. App.), 34 S. W., 844.
55. Where the payee of a check deposited the same with a bank for collection,
and said bank sent it for collection to defendant, and defendant received
from the bank upon which the check was drawn a draft in payment
thereof, defendant is not liable to the payee for the conversion of said
draft, in the absence of a demand therefor, and neither a telegram sent
to defendant by the drawer of the check, instructing defendant to hold
the draft, nor an inquiry by the bank upon which the check was drawn
134
REPORT OF THE COMPTROLLER OF THE CURRENCY,
CHECKS: See Certification of checks; Collections—Continued.
as to whether defendant could hold the draft, is a sufficient demand on
behalf of said payee. 26 N. Y. S., 1035 affirmed; Castle v. Corn Exch.
Bank (N. Y. App.), 42 N. E., 518.
56. The holders of a draft before maturity are not bound by the acts of indorsers
after the transfer. Blochv. Creditors (La.), 16 So., 267; St. Louis Nat.
Bank v. Bloch. Ib.
57. The payee of a forged check who indorses it and receives full value therefor guarantees its genuineness; and as to him the indorsee is under no
obligation to discover that it is forged, and may recover back the money
so paid. Birmingham Nat. Bank v. Bradley (Ala.), 15 So.,440.
58. Bank checks are due on presentation, and are not entitled to days of grace.
Wood River Bank v. First Nat. Bank (Neb.) ,55 N. W.t 239.
59. Where the indorsee of a draft accepts the drawee's check in payment,
instead of cash, and neglects to present it for payment or certification
until the next clay, and the check is dishonored in consequence of the
delay, and the draft has to be protested for nonpayment, the drawer can
not be held liable. Merchants' National Bank of the City of New York
v. Samuel and another, 20 Fed. Rep., 664.
60. Plaintiff accepted in good faith a check in which the indorsement of the
payee's name was a forgery, and after indorsing the same delivered it to
defendant bank for collection. Defendant collected the check and paid
the money to plaintiff, but on subsequently discovering the forgery paid
back such amount to the bank on which the check was drawn without
notifying plaintiff of the forgery or that it had paid back the sum collected. Held, that any fund belonging to plaintiff subsequently coming
into possession of defendant could be legally applied to the reimbursement of the latter for the amount advanced on the check, plaintiff being
chargeable with notice of the forgery. Green v. Purcell Nat Bank
(Indian Ter.), 37 S. VS., 50.
61. A regular customer of a bank sent to it a check with an unrestricted
indorsement, and directed it to be placed to his credit. The check was
received and credited and the customer so advised. On the day of
receipt the bank sent the check to its correspondent for collection, paid a
check drawn by the customer from a part of the proceeds of the credit,
and closed its doors as insolvent. Held, that the check was not deposited
for collection, but as cash for immediate use. Williams v. Cox (Tenn.
Sup.) ,37 8. W.,2S2.
62. Where a bank accepts a check on another bank as cash, giving therefor a
sum of money, a certificate of deposit, and the balance in a credit to.
the account of a third person, such transaction creates merely the relation of debtor and creditor between the bank and its customer, and the
latter can not, on the insolvency of the bank, follow up the checS, or its
proceeds, as his property. Friberg v. Cox (Tenn. Sup.), 37 S. W., 283.
63. Where a check drawn on another bank is deposited in an insolvent bank
without any special instructions, and it is not placed to the customer's
credit, and immediately thereafter the receiving bank fails, and the
check goes into the hands of the bank examiner and is afterwards collected, the proceeds are the property of the customer, and not of the
bank. Showalter v. Cox (Tenn. Sup.), 37 S. W., 286.
64. The holder of a check can not sue the bank on which it is drawn, unless
it has been accepted by the bank. PicMe v. People's Nat. Bank (Pickle
v. Muse), 12 S. W., 919; 88 Tenn., 380.
CIRCULATION:
1. The circulating notes of a national banking association are valid though
they do not bear the imprint of the seal of the Treasury. Such imprint
was intended to be simply evidence of the contract, and forms no part
of the contract itself. United States v. Bennett, 17 Blatch., 357.
2. The State can not tax the circulating notes of national banking associations. Horne v.Greene, 52 Miss., 452.
3. The State, until forbidden by Congress, has the power to tax national-bank
bills. Lilly v. The Board of Commissioners of Cumberland County, 69
N. C., 300.
4. The circulating notes of national banks, known as "national currency,"
are not exempt from taxation by a State. Board of Commissioners of
Montgomery County v. Elston, 32 Ind., 27; 1 N. B. C., 425.
5. The power of a State to tax the circulation of the national banks depends
REPORT OF THE COMPTROLLER OF THE CURRENCY.
135
CIRCULATION—Continued.
upon whether such circulation is for the use of the United States Government or for private profit. Congress can protect the circulation of
those banks, by forbidding the States to tax it. Until this is done, the
States have a right to tax it. Muffin v. Board of Commissioners, 69
N. C, 498; 1 N. B. C., 806.
6. The tax of 10 per cent imposed by the act of July 13, 1866 (14 Stat. at
Large, 146, sec. 9), on the circulation of State banks used for currency
and paid out by the national or State banks is not repugnant to the Constitution, either on the ground that the tax is a direct tax, which must
be apportioned among the several States, or that the act impairs franchises granted by the State. Veazie Bank v. Fenno, 8 Wall,, 533; 1
•N. B.C., 22.
7. Congress having undertaken, in the exercise of undisputed constitutional
power, to provide a currency for the whole country, may constitutionally
secure the benefit of it to the people by appropriate legislation, and to
that end may restrain by suitable enactments the circulation of any
notes not issued under its own authority. Ib.
8. The provision of section 3413 of the national-bank act, that' * every national
banking association, State bank or banker, or association, shall pay a tax
of 10 per cent on the amount of notes of any town, city, or municipal
corporation paid out by them " is constitutional, even where its effect is
to tax an instrumentality of a State. Merchants' Natioyial Bank of Little
Rock v. United States, 101 U. 8., 1; 2 N. B. C, 100.
9. The circulating notes of national banking associations are included in the
phrase " United States currency" when used in a penal statute. State
v. Gasting, 23 La. Ann., 1609.
COLLATERAL SECURITIES:
1. A national banking association may take stock of a corporation as collateral security for a loan. Shoemaker v. TJie National Mechanics' Bank,
2 Abb. U. 8., 416; 1 N. B. C, 169.
2. And it»may take for such purpose the stock of another national banking
association. National Bank v. Case, 99 U. S., 628.
3. A national banking association may take a pledge of personal chattels as
security for a loan. Pittsburg Locomotive and Car Works v. State
National Bank of Keokuk, 2 Cent. L. J., 692; 1 N. B. C.,315.
4. A national banking association may take as collateral security for a loan a
warehouse receipt for merchandise. Cleveland, Brown <& Co. v. Shoeman, 40 Ohio St., 176.
5. Where stockholder borrows money from bank and gives as security certificate of his shares of its stock, he is not entitled to recover when, on
nonpayment <ff loan, the bank sold his stock and applied proceeds to his
credit. First National Bank of Xenia v. Stewart, 107 U. 8., 676.
6. Creditor of insolvent bank has the right to prove and have dividends upon
his entire claim, irrespective of collateral security he may hold. Peoples
v. Remington, 121 N. Y., 328.
7. A pledgee of stock in a private corporation holding the certificates as collateral security, and having had the transfer duly entered on the books
of the corporation, is liable to creditors as the owner thereof on the subsequent insolvency and dissolution of the corporation, and this liability
is governed by the law in force when their debts were created (Rev.
Code, 1867, sec. 1760), although it had been repealed or abrogated before
the stock was transferred to him. National Commercial Bank v.
McDonnell, 92 Ala., 387.
8. It is the duty of a receiver, if a secured debt is so reduced by dividends
that the security will more than pay it, to redeem the security for the
benefit of his trust. West v. Bank of Rutland, 19 Vt., 403; Miller's
Estate, 82; Penn St., 113; Bates v. Paddock,? W. Rep.,222.
9. A sale of shares of stock pledged as collateral security, without notice to
the pledgor, is not a conversion, when it appears that the stock was
knocked down to a nominal purchaser without his knowledge or consent,
and that the certificates, though changed into his name, were never
delivered to him, but were retained by the pledgee until after a subsequent sale pursuant to notice. Terry v. Birmingham National Bank. 93
Ala., 599.
10. For an unauthorized sale of stock pledged as collateral security amounting to a conversion, the pledgor is entitled to recover, as damages, the
136
REPORT OF THE COMPTROLLER OF THE CURRENCY.
COLLATERAL SECURITIES—Continued.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
market value of the stock at the time of the sale, with interest to the
day of the trial; and the jury may, in their discretion, allow the highest
market value at any time between the sale and the trial. Ib.
This suit was brought to recover the value of certain bonds, which, it is
claimed, had been left at the bank as collateral security for money which
the bank might, from time to time, advance the plaintiff. The plaintiff
testified that on July 1,1868, he went to the bank to obtain a loan upon
this security; that the bonds could not be found, but that he received
the money. The defendant requested the court to instruct the jury that
" if the bonds were not found by the bank when the note of July 1 was
offered and were not afterwards found, the jury are not authorized to
find that they were taken and held as collateral security for the note of
July 1." Held, that this instruction was properly refused. Dearborn v.
The Union National Bank of Brunswick, 61 Me., 369.
A bank is bound±o take only ordinary care of United States bonds pledged
to it as collateral security for the payment of a note discounted by the
bank. Jenkins v. National Village Bank of Bowdoinham, 58 Me., 275.
A writing, executed by the cashier, acknowledging the receipts by the
bank, " to be returned to him on the payment of his note in four months,
dated May 9, 1866," is not a contract which increases the common-law
liability of the bank, even if the cashier had the authority to do so. Ib.
Securities taken by sureties for their indemnity inure to the benefit of the
creditor. Thornton v. National Exchange Bank, 71 Mo., 221; 3 N. B. C.,
513.
Creditors holding collateral security are liable for negligence in realizing
thereon. National Bank of Jefferson v. Bruhn et al., 64 Tex., 571.
In an action by a pledgee upon the debt secured by the pledge he is not
required to account for nonnegotiable securities pledged to him by
defendant, in the absence of any allegation or proof that he has lost or
misappropriated them. Marberry v. Farmers and Mechanics' National
Bank, 26 S. W., 215.
The cashier of a bank has no authority to assign collaterals belonging to
himself, which were given to secure a loan to another person for the
cashier's benefit. Merchants' National Bank y. Demere, 19 S. E., 38.
One who borrows money from a bank for the cashier thereof, on collaterals
belonging to the cashier, is not entitled to credit for amount of such
collaterals after they have been wrongfully withdrawn and converted
by the cashier. Ib.
When shares of stock in a private corporation are pledged as collateral
security for a debt, and default is made in the payment of the debt at
maturity, the pledgee may file a bill in equity to foreclose the pledge by
a sale under the order of the court, or he may exercise the implied power
to sell without resorting to judicial proceedings; but if he elects to pursue the latter remedy, the sale must be at public auction, in the absence
of a special agreement, and reasonable notice must be given to the pledgor;
and if he sells privately, without notice, becoming himself the purchaser,
the relation between him and the pledgor is not thereby dissolved.
Sliarpe v. National Bank of Birmingham, 87 Ala., 644.
If the pledgor, when notified of the irregular or unauthorized sale, accepts
its benefits, giving his note for the balance of his debt remaining unpaid,
this is presumptively a ratification of the sale, and he can not afterwards
impeach it; but if he acted in ignorance of the fact that the pledgee
himself was the purchaser, and did not intend to make an absolute and
unconditional ratification without regard to the facts attending the sale,
he may disaffirm it within a reasonable time after discovering that the
pledgee was the purchaser. Ib.
If a part owner of certificates of stock pledges them, with the consent of
the other owner, as collateral security for his own debt, and they are
converted by the pledgee, the pledgor is entitled to recover as if he
were the sole owner, the pledgee being estopped from denying his absolute ownership. Ib.
Rev. St.,sec.5242, which declares all deposits, all transfers of deposits,
and all payments of money made by a national bank after an act of
insolvency, or in contemplation thereof, to be null and void, does not
render illegal the retention of a balance standing to the credit of an
insolvent national bank with a correspondent on the day of its failure
which has been pledged for the purpose of securing loan.^ made by the
REPORT OF THE COMPTROLLER OF THE CURRENCY.
137
COLLATERAL SECURITIES—Continued.
23.
24.
25.
26.
27.
28.
29.
30.
81.
32.
33.
correspondent to the insolvent bank. Bell v. Hanover National Rank,
57 Fed. Rep.,821.
Where a deposit with a correspondent has, long prior to the commission
of the act of insolvency by a national bank, been pledged as collateral to
secure the payment of loans made to the insolvent by its correspondent,
neither the subsequent insolvency of the bank, nor the appointment of
the receiver, destroys the lien of the correspondent, or its rights to dispose of the pledge to satisfy the debt secured. Ib.
Creditors of an insolvent national bank can not be required, in proving their
claims, to allow credit for any collections made after the date of the
declared insolvency from collateral securities held by them. Chemical
National Bank v. Armstrong, 59 Fed. Rep., 872.
Rev. St. U. S., sec. 5242, which prohibits all transfers by any national banking association made after the commission of an act of insolvency, or in
contemplation thereof, with a view to the preference of one creditor over
another, is directed to a preference, not to the giving of security when a
debt is created; and if the transaction be free from fraud in fact, and is
intended merely to adequately protect a loan made at the time, the creditor can retain property transferred to secure such loan until the debt is
paid, though the debtor is insolvent, and the creditor has reason at the
time to believe that to be the fact. Armstrong v. Chemical National
Bank, 41 Fed. Rep., 284.
The plaintiff, a judgment creditor of the defendant, had the steamboat
Kinta seized. The defendant had pledged it to the Third National Bank
of New York, but remained in possession for his own account, and never
completed the pledge by an actual delivery to the pledgee. The act of
pledge was drawn up in the common-law form, and was intended to
operate as a chattel mortgage. It contains, as to the form of the act, the
essentials of an act of pledge. Citizens' Bank of Louisiana v. Janin
(Third National Bank of New York, Intervenes), 15 So.,471,46 La. Ann.
The Third National Bank, as pledgee, claimed the proceeds of the sale. The
property, when it was seized, was in the possession of the subtenant. It
is not proved that the plaintiff colluded with the defendant, and thereby
gained an improper advantage. Pledge is not made perfect by the consent of the parties. It requires absolute possession. The alleged pledgee
never was in possession during the tenure of the defendant. Ib.
It (the Third National) could not obtain possession through the agency of
the sublessee, who held possession for his lessor, the defendant. Ib.
A pledge can not be made perfect by the sublessee's delivery of possession
without the consent of his lessor. Ib.
The obligation of the lessor to account for the property, and whatever revenues were realized therefrom, binding between him and his creditor, the
Third National Bank—the property not having been delivered—did not
affect his other creditors, who could seize the property in his possession,
or in that of his sublessee, who held possession for his lessor. Ib.
In an action by a bank on a promissory note, it appeared that the defendant delivered as security the promissory note of S., to which was annexed
as collateral security a certificate of corporate stock in the name of S.;
that defendant, with the consent of S., agreed that the bank might sell
the stock and take in place of the note of S. the note of the purchaser,
secured by the same stock reissued in the name of the purchaser; and
that the bank sold the stock and took in payment notes secured by the
stock, payable to itself, with which notes defendant had no connection,
and over which he had no control. Held, that as the bank had converted
the stock to its own use, defendant's note must be credited with the
value of the stock at the time of conversion. Pauly v. Wilson, 57 Fed.
Rep., 54S. .
Plaintiff had in his possession collateral security for a debt due from a
third party, who also owed the defendant. Held, that an agreement by
the parties in interest that any sum received on such collateral security
in addition to the indebtedness first secured thereby should be applied
on the debt due from defendant operated as an equitable assignment to
defendant of such surplus, if any there should be. Second National
Bankr. Sproat, 56 N. W., 254.
A clearing-house committee, created by the agreement of several banks,
which receives deposits from such banks of securities at a fixed ratio on
their capital stock, and issues certificates therefor to be used in paying
138
REPORT OF THE COMPTROLLER OF THE CURRENCY.
COLLATERAL SECURITIES—Continued.
balances, becomes an owner, for value, of the securities. PMller v. Patterson (Pa. Sup.), 32 A., 26.
34. The fact that a transfer of a bill of lading to a bank as security was after
its doors were closed for the day for the purpose of deposit and check
does not affect its right as against the vendor who stops the goods in
transit, though, before its doors are again opened, it learns of the insolvency of the vendee. First National Bank v. Schmidt {Colo. Aiop.), 40
P. 479.
35. As against the right of a vendor to stop goods in transitu, a bank to which
the vendee has transferred the bill of lading as security is a holder for
value, even though the transfer was for a preexisting debt, and not for
a loan made on the promise of such transfer. Ib.
36. Where the debt for which a note was pledged is paid pending an action on
the note by the pledgee, the latter may continue the action, subject to
all equitable defenses, holding the proceeds as trustee for the pledgor.
First National Bank v. Mann (Tenn.), 27 S. W., 1015.
37. The transferee of a note before maturity as collateral security for a loan
made in good faith is a bona fide holder *to the extent of the loan. Pearce <&
Miller Engineering Company v. Brouer (City Ct.N. Y.)y81N. Y. 8., 195.
38. Where the holder of an indorsed note has exchanged collateral, held to
secure such note, without the indorser's consent, the measure of the
indorser's damage is the difference between the value of the collateral
originally held and that for which it is exchanged, at the time of the
exchange. Nelson v. First Nat, Bank of Killingley, 69 Fed. Rep., 798.
39. The fact that a creditor's claim is secured by mortgage or otherwise does
not affect his right to prove for the full amount of the claim, nor does
the fact that he has realized part thereof out of the collateral since the
date of the receivership; but in the latter case he is entitled to dividends
only until the balance of his debt is satisfied. New York Security &
Trust Co. et al. v. Lombard Inv. Co. of Kans. et al., 73 Fed. Rep., 537.
40. The acceptance by a payee, as collateral, of the note of a third party
secured by mortgage payable after maturity of the original note, does
not establish an extension of the time of payment of the orignal note to
the date when the collateral note becomes payable, in the absence of
evidence of an express agreement therefor. Fishery. Denver Nat. Bank
(Colo. Sup.), 45 P., 440.
41. One holding collaterals as security for a debt due at a certain time, and
authorized by his contract to sell on maturity of the debt, need not
demand payment before selling. Franklin Nat. Bank v. Newcombe
(Sup.), 37 N. Y. S., 271.
42. One having collaterals as security for a note, which, by the terms of his
contract he was at any time after maturity of the note at liberty to sell
at private or public sale, with or without notice, can not be held liable
by reason of selling them when the market was in poor condition, they
having been sold two weeks after maturity of the note, at public sale,
after notice. Franklin Nat. Bank v. Newcombe (Sup.), 37 N. Y. S.,271.
43. A person having notes in his possession as collateral security for a debt i.3
bound, so far as the general owner of the notes is concerned, to use
reasonable diligence to protect the security so held, and see that it is not
outlawed. Northicestern Nat. Bank v. J. Tliompson & Sons Manufg
Co. (C. C. A.), 71 F., 113.
44. Where a debtor assigns to different persons assets as collateral security for
their claims, after such claims are satisfied, from whatever source, if
any balance from such assets remain, they are bound to return such
balance to the debtor or to his representative. Whittaker v. Amtcell
Nat. Bank (N J. Ch.), 29 A., 203.
45. The maker of a note held by plaintiff gave to one J., who was accommodation indorser thereof, a second note, indorsed by defendant, to secure
J. against loss by reason of his indorsement, and J. transferred the collateral note to plaintiff. Held, that plaintiff could sue on the collateral
note, though J. had paid nothing on account of his liability as indorser;
a creditor being entitled to all collaterals given by the principal debtor
to his sureties. Merchants & Manufacturers' Nat. Bank v. Cummings
(Sup.), 29 N. Y. &,7S?.
46. A judgment creditor realized the amount of his demand from collateral
security. The debtor notified him that the amount due was disputed,
and required him not to apply the collateral to its payment until tlie
REPORT OF THE COMPTROLLER OF THE CURRENCY.
139
COLLATERAL SECURITIES—Continued.
amount was determined. The plaintiff, notwithstanding, applied the
funds and satisfied the judgment of record. Held, that the defendant
was entitled to have the entry of satisfaction struck off and be admitted
to defend. Outhrie v. Reid, 107 Penn. St., 251; 3 N. B. C, 751.
COLLECTIONS: See Checks; Certified checks.
1. Where the holder of a bill of exchange, payable at a distant place, deposits
it with a local bank for collection, he thereby assents to the course of
business of banks to collect through correspondents, and the correspondent of the local bank to which the bill is forwarded becomes his
agent and is responsible to him directly for negligence in failing to
present the bill for payment within the proper time. Guelich v. The
National State Bank of Burlington, 56 Iowa, 434.
2. The payee of a check deposited it for collection with bank A on the same
day it was made. The bank presented it for payment the next day
shortly before 11 o'clock, and the drawee's check on bank B, only a few
blocks distant, was taken in payment. The drawee became a bankrupt
at 1 o'clock. Several checks given after this, one by the drawee on bank
B, were paid before 1 o'clock. Before 3 o'clock bank A presented the
check in question for payment, which was refused; whereupon it immediately went to the drawee, and, after recovering the original check,
protested it. Held, that the drawer of the check was not liable thereon.
Anderson v. GUI, 29 A., 527.
3. Where the payee of a check makes a demand on the drawee and receives
something other than cash in payment, he can not, by making a second
demand, though within the time allowed for presenting a check, undo the
first, and render the drawer liable on the bankruptcy of the drawee. Ib.
4. Two bills of exchange, belonging to the plaintiff at Chicago, were indorsed
for collection to a bank at Atchison, Kans,, and by said Atchison bank
to a bank at Kansas City, Mo., and by the latter to defendant, a bank at
Hutchinson, Kans. Held, that they remain the property of plaintiff, all
the indorsements being restrictive. First NaMonal Bank of Chicago v.
Reno County Bank, 1 McCrary, 491.
5. An indorsement on a bill of exchange directing the drawee to pay to another
*' on account of " the indorser, or '' for collection," is a restrictive indorsement, the effect of which is to restrict the further negotiability of the
bill, and to give notice that the indorser does not thereby give title to
the bill or to its proceeds when collected. Ib.
6. Although there may be no privity between the owner of the bill and the
last indorsee, yet, if the latter collects the bill, he is bound to pay the
proceeds to the owner, and the latter may recover in assumpsit on the
ground that the defendant has property in his possession which belongs
to the plaintiff and refuses to pay the same over. Ib.
7. A bank receiving an indorsed note before maturity for collection is required
to take the proper steps to fix the liability of the indorser. West v. St.
Paul National Bank, 56 N. W.,54; 54 Minn., 466.
8. In an action by the owner of the note for neglect of that duty, resulting
in the discharge of the indorser, the question of the solvency of the
maker is material as affecting the measure of damages. Ib.
9. Insolvency may be shown prima facie by proof of general reputation.
Proof of insolvency within a reasonable time after the maturity of the
note held admissible. Ib.
10. A bank receiving for collection, from a correspondent, checks drawn upon
it by a customer, with instructions to protest in case of nonpayment, is
required, in case payment is refused for want of funds, to give notice to
the bank from which they were received not later than the next day
after dishonor; and when they are held for two days in order to enable
the drawer to provide funds for payment thereof a jury will be warranted in finding that the bank intended to accept them and become
liable thereon. Wood River Bank v. First National Bank of Omaha,
55 N. W.,239.
11. The indorsement of a draft to a bank " for collection," accompanied by a
credit of the amount to the indorser's account, does not transfer title to
the bank, and correspondent of the bank who collects draft for it is
responsible therefor to indorser. Tyson v. Western National Bank of
Baltimore, 26 Atl. Rep., 520.
12. The Winters National Bank sent to the Fidelity Eank a note of $2,000 for
collection and indorsed: " Pay Fidelity National Bank, Cincinnati, Ohio.
140
REPORT OF THE COMPTROLLER OF THE CURRENCY.
See Checks; Certified checks—Continued.
or order, for collection for account of the Winters National Bank, Dayton, Ohio, J. C. Reber, cashier." The Fidelity Bank forwarded it to
the Drovers and Mechanics' Bank, which received payment thereof at
maturity. Before the Fidelity Bank received notice and remittance of
the $2,000 it became insolvent and went into the hands of a receiver,
who took the §2,000 and credited the Winters Bank therewith. Held,
that the Fidelity Bank did not own the note, and the Winters Bank was
entitled to the full $2,000 as against the Fidelity Bank's receiver. In
re Armstrong, S3 Fed, Rep., 405.
Plaintiff sent to F. bank a draft indorsed "For collection," accompanied
with instructions to "collect and credit proceeds." F. bank sent the
draft to the defendant and the latter collected it, received the proceeds,
and credited them to the F. bank, in accordance with the usual course
of business between the F. bank and the defendant, and notified the F.
bank of the credit. The F. bank suspended business before crediting
plaintiff with the proceeds, but after they had been collected and after
it had received notice of the credit. After the suspension of the F. bank
the receiver appointed over its affairs credited plaintiff with the proceeds of the draft on the books of the bank. Held, that the indorsement
"For collection" was notice to the defendant of the qualified title to the
F. bank, and defendant could not acquire any better title to the draft or
the proceeds than that of the F. bank, and could not, as against the
plaintiff, apply the proceeds to an account owing the defendant from
the F. bank, and that the defendant could only defeat an action brought
to recover the proceeds in its hands by showing that the draft or its proceeds belonged to the F. bank. First National Bank of Circleville v.
Bank of Monroe, 33 Fed. Rep., 408.
Held, further, that the relation of principal and agent continue between
the plaintiff and the F. bank so long as the latter did not assume the
relation of primary debtor to the plaintiff for the proceeds of the draft;
that the plaintiff not having been credited with the proceeds by the F.
bank, the relation between them remained that of principal and agent,
and not debtor und creditor; and that the F. bank, not having, credited
the plaintiff with the proceeds while it was a going concern, could not,
by doing so subsequently, change the existing relation. Ib.
Held, in an action brought by the plaintiff against the defendant to
recover the proceeds of the draft, the defendant, not having remitted the
proceeds to the F. bank, was liable to the plaintiff for the amount. Ib.
Plaintiffs sent to a certain bank a bill of exchange indorsed to said bank
for collection. At the time the bank received the bill of exchange it
was insolvent to the knowledge of the managing officer, and on that
day, or following morning, it failed. Prior to the failure it indorsed
the bill of exchange to defendant bank, which collected it and kept the
proceeds, crediting the insolvent bank, which was indebted to it, with
the amount thereof. Held, that the first bank acquired no title because
of its fraud in not disclosing its insolvency, and defendant had no better
title, as plaintiffs' indorsement showed that the bank was merely plaintiffs' agent to collect the proceeds. Peck et al. v. First National Bank,
48 Fed. Rep., 356.
Plaintiff sent to defendant's bank paper indorsed "For collection and
immediate return " to plaintiff, and the paper was collected and the proceeds mingled with other moneys of the bank, instead of forwarded to
plaintiff. The bill contained an uncontroverted allegation that defendant's bank, at all times subsequent to the collection and at the time of
defendant's appointment as receiver, had on hand cash to a greater
amount than that due plaintiff. The bill asked to have the balance due
plaintiff paid in full, on the ground that the bank by receiving the paper
for collection and immediate return became a trustee, and that either its
entire property or the money in its vaults became impressed with the
trusfc. Held, that if the mingling of the funds was a breach of trust it
was a conversion, and plaintiff became a simple contract creditor, with
no preference at law. Philadelphia National Bank v. Dowd, 38 Fed,
Rep., 112.
It was immaterial whether or not the bank atood in a fiduciary capacity to
plaintiff, as the facts stated in the bill showed that the money collected
could not be traced into any specific investment or fund, but had been
indistinguishably mingled with the general assets. Ib.
COLLECTIONS:
13.
14.
15.
16.
17.
18.
KEPORT OF THE COMPTROLLER OF THE CURRENCY.
141
COLLECTIONS: See Checks; Certified checks—Continued.
19. By agreement and custom the Fidelity Bank received drafts from its correspondent bank at E., and credited them to it as cash, with the understanding that any draft which was unpaid should be charged back to
the correspondent. The latter forwarded drafts, which were credited
to it, but were not collected before the Fidelity Bank failed. The drafts
were ^aid after the appointment of a receiver and the moneys actually
came into his hands. The drafts were indorsed payable to the Fidelity
Bank " for collection for the " bank at E. Held, that as the drafts were
when received credited as cash to the bank at E., which had the right at
once to draw against them, the indorsement for collection did not affect
the result, and the bank had only the rights of a general creditor. First
National Bank of Elkhart y. Armstrong, 39 Fed. Rep., 231.
20. A draft sent to a bank specially indorsed for collection was paid by the
drawee by check, which the bank collected through the clearing house.
A memorandum was placed with the bank's cash, to indicate that the
proceeds of the draft was the property of the sender. The bank was
closed the next morning, and the receiver credited such proceeds to the
sender of the draft on the books of the bank. Held, that the fund was
not so mingled that it could not be traced and identified, and that the
sender could recover the same. First National Bank of Montgomery v.
Armstrong, 36 Fed. Rep., 59,
21. Checks and drafts sent from one bank to another were indorsed " for collection," and credited "subject to payment," according to the dealings
between the banks. Part of them were paid to the receiver of the latter
bank after its failure, and the balance were credited to it by the payors.
Held, that the amount paid the receiver should be accounted for as a
trust fund, but the balance as a general debt. First National Bank of
Wellston v. Armstrong, 1^2 Fed, Rep., 193.
22. The claimant bank sent to the F. bank a sight draft, drawn on a third party,
indorsed " p a y " F . b a n k , o r order, "for collection for''claimant bank.
It was the practice of the F. bank in its dealings with claimant to credit
the latter on the day of receipt for all drafts, checks, etc., sent for collection that were payable at sight or on demand, and the balance thus
created was subject to be drawn on; but if the paper was not paid it was
charged back to claimant. On receipt of the draft the F. bank notified
claimant that it has been credited, "subject to payment;" but the credit
was not drawn against nor were advances made on the faith of it.
Claimant merely kept a memorandum of its transmission for collection.
The F. bank sent the draft to its reserve agent, indorsed, for collection,
and the amount of it was counted as apart of the F. bank's reserve fund,
though this fact was not known to claimant. Held, that the indorsement being restrictive, the F. bank acquired no title to it, and that upon
the insolvency of the F. bank, before notification of the collection of the
draft, the claimant was entitled to the proceeds of it in the hands of the collecting agent. Fifth National Bank v. Armstrong, Farmers' National
Bank, et ah, Interpleaders, 4-0 Fed. Rep.,46.
23. A bank which had received a draft for collection sent it to its correspondent
bank at the residence of the drawee, and the draft was paid to such correspondent. There were no mutual accounts between the two banks, but
it was the custom of the correspondent to remit the proceeds of collections
at stated periods. Held, that until this remittance was made, or the principal bank had given the original owner of- the draft credit for the avails,
the original owner of the draft, as the owner of the proceeds thereof,
was entitled to recover them from the correspondent bank. National
Exchange Bank of Dallas v. Beal, 50 Fed. Rep., 355.
24. Though the correspondent was the agent of the first bank, and payment to
it was to that extent a payment to the principal, yet until the proceeds
were actually remitted to such principal and mingled with its general
funds, or were so credited, the owner of the draft had the option to decline
to consider it his debtor and to claim the proceeds in the hands of the
agent. Ib.
25. Where the principal fails, and a receiver is appointed, he takes the proceeds
of the draft, when remitted to him, subject to the same right of reclamation by the owner that the latter had as against the agent. Ib.
26. Where, in such a case, there are mutual accounts between the two banks,
the right of the agent to set off the amount of the collection against the
principal's indebtedness to it can not be adjudicated in a suit in equity
142
REPORT OF THE COMPTROLLER OF THE CURRENCY.
COLLECTIONS: See Checks; Certified checks—Continued.
between the owner of the draft and the principal without making such
agent a party. Ib.
27. Checks deposited in a bank by its customers for collection do not at once
become the property of the bank; the bank continues to be the agent of
the customer until the collection of the check, which remains, in the
meantime, the property of the depositor. Ba Ibach et ah v. Frelinghuysen,
Receiver, etc., 15 Fed. Rep., 675.
28. The rule is ^different where such checks are deposited to make good an
overdrawn account of the customer or when the amount deposited by
check is immediately drawn against; in that case the bank may hold
the deposit until the overdraft is made good from other sources. Ib.
29. The indorsement by the customer of a check, deposited for collection, is
only intended to put the paper in such shape that the bank may collect
it, and not to thereby pass the title to the bank. Ib.
30. The practice which has grown up among banks to credit deposits of checks
at once to the account of the depositor, and to allow him to draw against
them before the collection, is a mere gratuitous privilege, which does
not grow into a binding legal usage. Ib.
31. A, who for several years had kept an account with the Marine National
Bank of New York, on May 5, 1884, deposited a sight draft, dated that
day, and drawn by him on a corporation of Boston, Mass., which was
indebted to him in the amount of the draft. The bank was insolvent at
the time, but the draft was forwarded to its collection agent at Boston,
and paid May 7, after the bank had failed and closed its doors. On several previous occasions A had deposited similar drafts, and been credited therewith as cash, and they were treated by him as cash deposits.
On the occasion in question the bank credited plaintiff with the draft as
a cash item. Held, that the draft was not the property of A when paid
by the drawee, and that he was not entitled to recover the amount
thereof from the receiver. St. Louis & S. F. Ry. Co. v. Johnston,
Receiver, etc., 21' Fed. Rep., 243.
32. When a sight bill is credited by a bank to a customer as a cash item, with
the latter's assent, the transaction is equivalent to a discount of the bill
by the bank. Ib.
33. Where a check of a depositor is accepted by a correspondent bank in payment of a draft for collection, which charges the same to the drawee
and credits the drawer without separating the amount from its general
funds, it holds the money as agent for the drawer, who, after insolvency,
becomes a mere general creditor, notwithstanding the State constitution provides t h a t " depositors who have not stipulated for interest shall
for such deposits be entitled in case of insolvency to preference of payment over all other creditors." Anheuser-Busch Brewing Association
v. Clayton, 56 Fed. Rep., 759.
34. A bank in Ohio contracted with a bank in Pennsylvania to collect for it at
par, at all points west of Pennsylvania, and remit the 1st, 11th, and 21st
of each month. In executing this agreement the Pennsylvania bank
stamped upon the paper forwarded for collection, with a stamp prepared
for it by the Ohio bank, an indorsement " Pay t o " the Ohio bank, " or
order, for collection for" the Pennsylvania bank. The Ohio bank
failed, having in its hands or in the hands of other banks to which it
had been sent for collection proceeds of paper sent it by the Pennsylvania- bank for collection. A receiver being appointed, the Pennsylvania
bank brought this action to recover such proceeds. Held, first, that
the relation between the banks as to uncollected paper was that of
principal and agent, and that the mere fact that the subagent of the
Ohio bank had collected the money due on such paper was not a commingling of those collections with the general funds of the Ohio bank,
and did not operate to relieve them from the trust obligation created by
the agency, or create any difficulty in specially tracing them. Commercial Bank of Pennsylvania v. Armstrong, 148 U. S., 50.
35. Second, that if the Ohio bank was indebted to its subagent, and the collections when made were entered in their books as a credit to such indebtedness, they were thereby reduced to possession and passed into the general funds of the Ohio bank. Ib.
36. Third, that by the terms of the agreement the relation of debtor and creditor was created when the collections were fully made, the funds being
on general deposit with the Ohio bank, with the right in that bank to
their use until the time of remittance should arrive. Ib.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
143
COLLECTIONS: See Checks; Certified checks—Continued.
37. A bank received two drafts indorsed to it for collection, on account of the
drawers, against two of its depositors. After acceptance by the latter
the bank charged to each depositor's account the amount of the draft
accepted by him. Before remitting to the drawers the bank assigned,
having on hand cash sufficient to pay such drafts. Held, that the
drawers were not entitled to a preference as to the funds on hands at
the time the bank failed, where the assignee holds nothing which he or
such drawers can identify with the drafts or trace as a payment of them.
Freiberg v. Stoddart, 28 Atl. Rep., 1111.
38. A national bank collected a note for plaintiff by accepting a draft for the
amount on another party, which it forwarded to its correspondent for
collection, and at the same time sent plaintiff a draft on the same correspondent as a remittance of the proceeds of his note. The correspondent received the money on the draft, sent it for collection, but before
plaintiff's draft was paid by the correspondent the bank failed. Held,
that the bank was only agent for plaintiff, and that the money derived
from his note was a trust fund, which did not become a part of the
bank's assets. Foster v. Rincker, 35 P., 470.
39. B. forwarded to bank a draft for collection. On July 22,1893, bank made
collection, and the same day forwarded its draft on New York. On
July 26 bank failed, and a receiver was appointed. Draft was presented
after the failure and payment refused. B. brought suit to secure a preference in payment. Held, that when a draft is forwarded to a bank for
collection, in the absence of instructions to the contrary, it is with the
understanding that upon collection the title to the proceeds shall vest
in the collecting bank, and that said bank shall remit to its correspondent the equivalent of such proceeds by the system of exchanges estabtablished by the universal custom among banks, and when this has been
done no preference can arise. Bowman et al. v. Clark et al., 38 P., 211.
40. Where one deposits a draft with a national bank and the bank sends it to
an agent for collection, who collects it, and the bank fails before receiving the avails, haying been insolvent at the time of the deposit, the
depositor may rescind the transaction for fraud and recover the avails
from the agent. Craigie v. Smith, 14 Abb. N. C, 409; 8 N. B. C, 679.
41. Plaintiff sent a draft to a bank for collection. The bank collected it and
then passed into the hands of a receiver without remitting. The bank
had previously made similar collections for plaintiff, the proceeds of
which were always remitted to him promptly and never credited to
him as a deposit. Held, that plaintiff was entitled to be paid the entire
proceeds of the draft ou-t of the bank assets in the receiver's hands, since
the bank was his trustee, and not his debtor. Hunt v. Toivnsend, 26
S. W.,310.
42. Under an agreement between plaintiff bank and the H. bank that the latter
should collect notes and checks forwarded it by plaintiff for a commission and remit daily, the relation of principal and agent as to any paper
ceased on collection, and the relation of creditor and debtor as to cash
immediately arose. First National Bank of Richmond v. Davis, 19
S. E., 280.
43. On failure of the H. bank, it being shown that its cashier had no knowledge
of its insolvency till the failure, it is not chargeable as for a conversion
of funds of plaintiff which it has mingled with its own funds, since, in
the absence of such knowledge on the cashier's part, the contract, with
its necessary implication as to the disposition to be made of plaintiff's
money on collection, remained in force till the failure. Ib.
44. Where plaintiff and defendant banks for several years had acted as agents
for each other in the collection of checks, notes, and drafts, and where
plaintiff sent defendant a note "for collection and credit "which on
maturity was paid by a check and credit was immediately given on the
books, but defendant failed and fhe check passed into the hands of a
receiver. Held, that in view of the course of dealing the two banks
stood in the relation of debtor and creditor with respect to the amount
of the check, and it became part of the assets of the bank. Franklin
County National Bank v. Beal, 49 Fed. Rep., 606.
45. Whether the title to a check deposited with a bank passes to the bank
before collection, so as to immediately create the relation of debtor and
creditor between it and the depositor is a question of fact, depending
upon the circumstances and course of dealing in each particular case.
City of Somerville v. Beal, 49 Fed. Rep., 790.
144
REPORT OF THE COMPTROLLER OF THE CURRENCY.
COLLECTIONS: See Checks; Certified checks—Continued.
46. Where a bank, in accordance with its custom, credited checks deposited by
a customer at the close of each day's business, retaining the right to
subsequently charge off the same if returned unpaid from the clearing
house, and the bank became insolvent on a succeeding day, title in the
checks passed to the bank so as to create the relation of debtor and
creditor. IK
47. Where a national bank collected all papers sent to it by complainant under
an arrangement which constituted the bank the agent of complainant,
the latter can recover, on the ground of a trust, from a receiver of the
bank such portion only of the proceeds of its paper sent to the bank as
it shows has passed into the receiver's hands, either in its original or
some substituted form. Commercial National Bank v. Armstrong, 39
Fed. Rep., 684.
48. Where checks and drafts sent from one bank to another indorsed " For collection" and credited "subject to payment" according to the dealings
between the banks, and part of them were paid to the receiver of the
latter bank after its failure and the balance were credited to it by the
pajors, the amount paid the receiver should be accounted for as a trust
fund, but the balance as a general debt. First National Bank v. Armstrong, 42Fed. Rep., 193.
49. Negotiable paper with restrictive indorsement credited by agent on date
of receipt "subject to payment," although account is subject to be
drawn upon, title is not transferred, and upon the insolvency of the
agent before receiving notice of the collection of the item, the owner is
entitled to the proceeds in the hands of the collecting agent. Fifth
National Bank v. Armstrong, 40 Fed. Rep., 46.
50. The drawers of a draft deposited with a bank for collection, and by it forwarded to a correspondent bank, are entitled to the amount as against
the receiver of the forwarding bank, which was insolvent, and known
to be so by its officers when it received the draft, and suspended payment before the proceeds were withdrawn from the collecting bank.
Importers and Traders' National Bank v. Peters et al., 123 N. Y., 272.
51. When a bank-which has received a draft for collection sends it to another
bank for that purpose, and on being advised that the latter bank has
collected the draft credits the depositor and then becomes insolvent
without having received the money from the collecting bank, the depositor remains the owner of the draft, and is entitled to its proceeds from
the collecting bank against the receiver and the creditors of the insolvent bank. Armstrong v. National Bank of Boyeriown, 11 S. W., 411;
Manufacturers9 National Bankv. Continental Banket al.,20 N W., 193.
52. A bank which collects a draft sent to it by another bank for that purpose,
with directions to remit the proceeds to a third bank for the'owner's
account, does not thereby become a trustee, so that the fund can be
followed into the hands of a receiver, although it had become mixed
with the other cash of the bank before his appointment; especially when
it appears that the business was carried on, and money paid out, for
several days after the collection was probably made. Merchants and
Farmers' Bank v. Austin et al., 48 Fed. Rep., 25.
53. Where bank sends paper to another bank for collection and credit on general account, the custom being to enter credit only when paper is collected, the relation being that of principal and agent until collection
and receipt of money by the second bank, and if latter sends to another
bank, which collects, but does not remit until latter bank has failed, the
former can recover the proceeds from the receiver thereof. Beal v.
National Exchange Bank of Dallas, 55 Fed. Rep., 894.
54. Whether the title to a check deposited with a bank passes to the bank
before collection, so as to immediately create the relation of debtor and
creditor between it and the depositor, is a question of fact, depending
upon the circumstances and course of dealing in each particular case.
City of Somerville v. Beal, Receiver, 49^ Fed, Rep., 790.
55. A bank which, upon a draft being deposited with it for collection, refuses
to accept it as a deposit, but advances a small amount to the payee on
her check, and charges her therewith on its books as an overdraft, and
sends it for collection to its correspondent, and, upon receiving notice
of its collection, credits the payee's account therewith, is the payee's
agent, and the proceeds constitute a trust fund, which the payee is
entitled to recover from the receiver. Henderson v. O'Connor (Cal.), 39
P., 786.
REPORT OF THE COMPTROLLER OF THE CURRENCY. '145
COLLECTIONS: See Checks; Certified checks—Continued.
56. Where a bank received a draft as agent for plaintiff, of which fact the
indorsement was a notice to other banks, it did not thereby become
indebted to plaintiff for the amount thereof till after collection and
possession of the proceeds, either actually or by settlement with the
parties; and defendant bank, to which the draft had been sent by the
first bank for collection, could not escape liability to plaintiff by making payment to the first bank, or giving the credit to it on the account
between the banks after the first bank had stopped payment. Old
National Bank v. German American National Bank, 15 8. Ct., 221.
57. A bank which has received a check for collection is not made liable to the
drawee for its amount by the fact that, upon protest of the check for
nonpayment, it has accepted from the maker thereof a check upon
another bank, payable to the order of its cashier, the drawee of the first
check being absent from the city, which latter check is also protested for
nonpayment. Citizens' Bankv. Houston (Ky.),32 S. W., 897:
58. Where a draft upon a nonresident drawee is deposited for collection with
a local bank, and by it transmitted to another bank for collection, according to custom, the local bank is not responsible for loss occasioned by the
default of the latter bank, since such latter bank is the agent of the
depositor. 58 III. App., 61, affirmed; Waterloo Milling Co. v. Kuenster
(III. Sup.), 41N. E., 906.
59. Where a bank, on collecting drafts for another bank, transmits bank drafts
to* such bank, which credits the depositor with the amount of such drafts,
and then collects only part of the drafts on account of the* failure of the
other bank, it has a right of action against the depositor for the deficit. Ib.
60. Where a check properly indorsed was sent by due course of mail for collection to the bank on which it was drawn, the drawer haying sufficient
funds on deposit to pay the check, and was returned unpaid through the
negligent mistake of an employee of the bank, it constituted a refusal
to pay. Atlanta Nat Bank v. Davis (Ga.), 23 S. E., 190.
61. A bank which, as collecting agent of another bank, collects at the subtreasury a pension draft on which the payee's name has been forged
after her death, indorsing the draft as collecting agent, and remits the
proceeds, without knowledge of the forgery, is not liable to the United
States for the amount so collected. Onondaga Co. Sav. Bank v. United
States (C. C. A.), 64 F., 703, distinguished; United States v. American
Exchange Nat. Bank (D. C), 70 F., 232.
62. Where a mortgage is sent to a bank for collection, with direction to remit,
the relation of creditor and debtor is not established between the sender
and the bank, where the latter fails to remit, and therefore, on the insolvency of the bank, a trust will be imposed on its assets in favor of the
sender as against general creditors of the bank. Wallace v. Stone
(Mich.), 65 N. W., 113.
63. Where the owner of a check, which had been collected without her authority by a bank, accepted, with knowledge of the facts, part of the proceeds of the collection, and a note for the balance of her claim arising
out of the transaction, she thereby ratified the collection, and the bank
was, hence, not liable to her. Hughes v. Neal Loan & Banking Co.
(Ga.),23 S.E.,823.
64. A bank holding a note for collection from one not a depositor, and which
receives payment thereof by charging to the account of a depositor having sufficient to his credit to meet it, does not become thereby a debtor
of the owner of the note, but holds the amount of the collection in trust
for him; such trust being impressed on all the funds of the bank, which
may be followed though they pass into the hands of a receiver. People
v. Merchants' Bank (Slip.), 36 N. Y. S., 9S9j In re Friend, lb.
65. Where a note was placed in a bank for collection, with instructions to collect when due and apply the proceeds to the depositor's paper, and a
person voluntarily selected by the bank to present the note at the place
named for payment and receive payment thereon collected the note, the
bank was liable for the proceeds to the owner. First Nat. Bank v. Craig
(Kan. App.), 42 P., 830.
66. Where a bank in the State receives for collection a draft payable at another
bank within the State, but transmits the draft to a foreign bank in the
course of collection, which in turn transmits it to the bank at which it
is payable, the last-named bank is responsible for its negligence' in collection only to the foreign bank. First Nat. Bank v. Mansfield Savings
Bank, 10 Ohio Cir. Ct. B., 283.
H. Doc. 10
10
146
REPORT OF THE COMPTROLLER OF THE CURRENCY.
COLLECTIONS: See Checks; Certified checks—Continued.
67. Where a bank receives a draft for collection, and transmits it in the course
of business to another bank, the cashier of the latter bank has no implied
authority to agree to defend in behalf of his bank an action against the
first bank by the drawer of the draft for negligence in collection. Ib,
68. In an action by the drawer to recover the proceeds of a draft collected by
a bank the fact that the bank has credited such proceeds to the account
of another bank, from which the draft was received, is no defense where
the indorsement thereon showed that the sending bank held it for collection only, the money being subject to the order of the real owner,
unless actually paid over to the sending bank before notice of the revocation of its agency. Boykin v. Bank of Fayetteville (NIC.) ,24 S. E., 357.
69. That a check deposited with a bank for collection was unrestrictedly
indorsed to the bank, and credit therefor given the depositor, does not
pass the title to the bank where, on nonpayment of the check, its amount
was to be charged up to the depositor so as to prevent its recovery by
the depositor from a receiver appointed for the bank. Armour Packing
Co.v. Davis (N. C), 24 S. E., 365.
70. The owners of a draft on a bank indorsed it to the K. bank for collection,
and it was sent by the latter bank to the clearing house, in due course,
with other checks and drafts. The K. bank was closed before the balance against it on the clearing-house settlement was adjusted, and thereupon the clearing house called upon the drawee, also one of its members,
to pay to it the amount of the draft. Held, that the payment being to
a stronger to the draft, who had no interest in the proceeds nor authority to act as agent for the owners, it was no defense to an action by the
owners against the drawee for the amount of the draft. Crane v. Fourth
St. Nat. Bank (Pa. Sup.),34A., 206.
71. A bank which has a draft for collection will not be excused for negligence
in sending it direct to the drawee, instead of through a third person, if
it would have been collected had it been sent at the time it was sent to
a third person, though, had the bank delayed sending it as long as it
might have without negligence, it would not have reached its destination in time to be collected. First Nat. Bank v. City Nat. Bank (Tex.
Civ. App.), 34 S. W., 45S.
72. A bank having a draft of §2,000 for collection will not be held liable for
negligence in sending it direct to the drawee bank, instead of through a
third person, where, at 1 o'clock on the day on which it reached its destination, the drawee bank required $1,000 to insure its ability to meet
local checks which might be presented that day after the hour, and was
furnished that amount by another bank for that purpose, to prevent a
general run on local banks. Ib.
73. A bank which receives checks to be transmitted to another place for collection without compensation fully discharges its duty by sending them
in due season to a solvent and competent correspondent, with proper
instructions for their collection, and is not liable for any loss occasioned
by the negligence of such correspondent. Anderson v. Alton Nat. Bank,
59 III. App., 587.
74. When a bank indorses commercial paper '' for collection " and forwards
the same to another bank for collection and remittance, the collecting
bank, though it acts only as agent for the remitting bank, and has no
mutual account with it, is not required to keep the moneys collected
separate from all other moneys in its possession, and to remit the identical money, ncr is the payer of such paper required to see that the
identical money is remitted. First Nat. Bank of Richmond v. Wilmington & W. B. Co., 77 Fed. Rep.,401.
75. When a bank indorses commercial paper "for collection" and forwards
the same to another bank, the latter, though it acts only as agent for the
remitting bank and has no mutual account with it, is not required to
keep the moneys collected separate from other moneys in its possession
and to remit the identical money, nor is the payer required to see that
the identical money is remitted. Ib.
76. Transfer of a note to a bank for collection gives it such ownership thereof
that it can sue the maker thereon. First Nat. Bank v. Hughes (Cal.),
46 P., 272.
77. That the correspondent has credited the account of the remitting bank with
the proceeds of the collection does not preclude the owner from recovering such proceeds of the correspondent upon the insolvency of the
remitting bank. Branch v. United States Nat. Bank (Neb.), 70 N. W., 34.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
147
COLLECTIONS: See Checks; Certified checks—Continued.
78. The owner of negotiable paper placed it with a Boston bank to be transmitted to its New York correspondent for collection for the account of
the owner, and the Boston bank so instruc ted the New York bank. Held,
that the New York bank became the agent of the owner of the paper
and was liable to him for negligence in making the collection. Kelley
v. Phoenix Nat Bank {Sup.), 45 N. Y. 8., 533.
79. Defendant bank received for collection a draft drawn on plantiff, payable
at another bank where he had funds and had left instructions to meet
it. Defendant negligently failed to present the draft until the failure
of the bank at which it was payable, so that plaintiff became discharged
from liability thereon. Held, that plaintiff could not recover back the
amount of the draft paid by him to defendant with knowledge of the
facts, although he made the payment under protest and to save his
credit. Harvey v. Oirard Nat. Bank (Pa.), 13 A., 202.
80. Collecting commercial paper is part of the regular business of banking,
and a national bank will be liable for negligence in collecting a draft
the same as any other bank or agent. Mound City Paint & Color Co. v.
Commercial Nat. Bank, 9 P., 709; 4 Utah, 353.
81. Where the owner of a note sends it to a bank for collection only, and the
maker's check is drawn on that bank for the amount thereof, and is delivered to it, and the note i3 thereupon canceled and surrendered, and the
check is charged to the account of the maker, which was good for the
amount, there is a collection of the amount from the general fund of the
bank and a special appropriation of that amount to the payment of the
note, and as between the owner of the note and the receiver of the bank
the title to the money dedicated to the payment of the note remains in
the owner. Arnot v. Bingham, 9 N. F S., GS; 55 Hun., 553.
CONSTITUTIONALITY :
1. Congress has the constitutional power to incorporate banks. McCulloch v.
Maryland, 4 Wheat., 316; Osborne v. Bank of the United States, 9
Wheat, 738.
2. Congress has power to clothe national banking associations, as to* their
contracts and dealings with the world, with any special immunities and
privileges exempting them, in their trade and intercourse with others,
from the laws and remedies applicable in like cases to other citizens.
The Chesapeake Bank v. The First National Bank of Baltimore, 40 Md.,
269.
3. Thus, the provision of the banking law that no attachment, injunction, or
execution shall issue against a national banking association before final
judgment in any suit, action, or proceeding in a State court is constitutional. Ib.
4. Congress having, in the exercise of undisputed constitutional powers,
undertaken to provide a currency for the whole country, may secure the
benefit of it to the people by appropriate legislation. Veazie Bank v.
Fenno, 8 Wall., 533.
5. Congress has the power to divest the United States courts of their jurisdiction of suits by or against national banking associations. National
Bank of Jefferson v. Fare et al., 25 Fed. Rep., 209.
6. National banking associations, being instruments designed to aid the Government in the administration of a branch of the public service, can not
be controlled by the States, except in so far as Congress may see proper
to permit. Farmers and Mechanics' Bank v. Dearing, 91 U 8., 29.
7. A State law prohibiting the establishment of banking companies in the
State without the authority of the legislature was not intended to apply
to banking corporations created by authority of Congress, since such
corporations may be legally established in the State without the consent
of the legislature. Stetson v. City ofBangor, 56 Me., 274.
8. National banking corporations, organized under the acts of Congress providing for their creation, are agencies or instruments of the General
Government, designed to aid in the administration of an important
branch of the public service, and are an appropriate constitutional
means to that end. Pollard v. The State ex. rel. Zuber, 65 Ala., 628.
9. The national banking act is an enabling act for associations organized
under it, and one can not rightfully exercise any powers except those
expressly granted, or such incidental powers as are necessary to carry
on the business for which it was established. Logan County National
BankY. Toivnsend, 139 U. S., 67.
148
REPORT OF THE COMPTROLLER OP THE CURRENCY.
CONSTRUCTION OF LAW:
1. The Federal courts, when called upon to construe the general commercial
law of Indiana in respect to a question which is a new one in the Federal
courts, should give weight to the Indiana decisions, although they are
not absolutely bound thereby. The Farmer's National Bank of Valparaiso, Ind., v. Sutton Mfg. Co., 52 Fed. Rep., 191.
2. The intention of the legislature, clearly expressed in a constitutional enactment, should not be defeated by too rigid adherence to the letter of the
statute, or by technical rules of construction. Any construction should
"be disregarded which leads to absurd consequences. Oates v. First
National Bank of Montgomery, 100 U. S., 239; 2 N. B. C.,35.
3. The Federal courts are not bound by decisions of State courts upon questions of general commercial law. Ib.
4. In a statute which contains invalid or unconstitutional provisions that
which is unaffected by those provisions, or which can stand without
them, must remain. If the valid and invalid are capable of separation
only the latter are to be disregarded. Supervisors of Albany v. Stanley, 12 Fed. Rep., 82.
5. Where the State and Federal courts have concurrent jurisdiction, a State
statute of limitation may be pleaded as effectively in a Federal court as
it could be in a State court; and in such cases the Federal courts will
follow the decisions of the local State tribunals and will administer the
same justice which the State courts would administer, between the same
parties. Price, Receiver of Venango National Bank v. Yates, 19 Alb. L.
J.,295; 2^N. B. C., 204.
6. Repeals by implication are not favored by the courts, and in the absence of
express words of repeal it is the duty of the court to give effect to a prior
statute, if it can be done, unless the repugnancy between the two is so
absolute and palpable as to be recognized at once. United States v.
Cooke Co. Nat. Bank, 25 Int. Rev. Record, 266; 2 N. B. C, 128.
7. It is the peculiar province of the supreme court of the State to determine
the meaning of the statutes of such State, and with such determination
courts of the United States will hesitate to place upon a State statute
any construction which will bring such statute in conflict with a statute
of the United States, and therefore render it void. Davenport National
Bank v. Mittelbuscher, Collector, et al., 15 Fed. Rep., 225.
8. The punctuation of a statute is not made to be relied on. and must be disregarded if it requires a construction which is repugnant to a sense of
justice. United States v. Vorhees, 9 Fed. Rep., 148.
9. Where Congress has enacted a law covering a particular case, such law
must prevail in the Federal courts though it differs from the State law.
Stephens v. Bernays, 42 Fed. Rep., 488.
10. Among the assets of an insolvent national bank were three mortgages
which were sought to be impeached by the assignees of the mortgagor
as having been given in violation of the insolvency law of the State.
Plaintiff, receiver of. the bank, claimed that the State law was inoperative
upon the assets of a national bank, and was ineffectual to divest him of
the title acquired by the mortgages. Held, that the mortgages were
governed by the State law, and the bank took them with all the limitations imposed by the laws of the State upon them. Witters, Receiver,
etc., v. Sotrles et al, 32 Fed. Rep., 758.
11. As the Supreme Court of the United States has decided that it has authority to reexamine the judgment of a State court as to the power of
national banks under the act of Congress, a State court should follow
its decisions on the question. First' National Bank of Aberdeen v.
Andrews et al.; Young v. Same, 34 P., 913; 7 Wash., 261.
12. By the provisions of Rev. Stat. U. S., § 5134, subd. 2, requiring an association
formed for the purpose of
conducting a national bank to designate in its
organization certificate 4<the place where its operations of discount and
deposits are to be carried on." the town or city is meant, and not the
office or building. 61 111. Apji., 33, affirmed. McCormick v. Market Nat
Bank (IIISup.), 44 N.E., 381.
CONVERSION:
1. Where a State bank has been converted into a national banking association
it may enforce all contracts made with it while a State corporation.
City National Bank v. Phelps, 97 N. Y, 44.
2. And it is liable, after the conversion, for all the obligations of the old insti
REPORT OF THE COMPTROLLER OF THE CURRENCY.
149
CONVERSION—Continued.
tution. Coffee v. The National Bank of Missouri, 46 Mo.9140; Kelsey v.
The National Bank of Crawford, 69 Penn. St., 426.
3. A national banking association, organized as the successor of a State bank,
may take and hold the assets of the bank whose place it takes, though
there was not in form a conversion from a State to a national corporation, but the organization of a new corporation. Bank v. Mclntyre, 40
Ohio St., 528.
4. And such association will be liable to the depositors of the former bank.
Eans v. Exchange Bank, 79 Mo., 182.
5. A State law authorizing national banking associations which have been
converted from State banks to use the name of the original corporation
for the purpose of prosecuting and defending suits is not in conflict with
the national banking law, and therefore proceedings based upon a judgment obtained before the conversion may be instituted by such association in its former corporate name. Thomas v. Farmers' Bank of Maryland, 46 Md., 43.
6. The conversion of a State bank into a national bank, with a change of
name, under the national-bank act does not affect its identity or its right
to sue upon liabilities incurred to it by its former name. Michigan
Insurance Bank v. Eld/red, 14s U. S.,293.
7. No authority other than that conferred by act of Congress is necessary to
enable any State bank to become a national banking association. Casey
v. Galli, 94 U.S.,673.
8. When a State bank is converted into a national banking association all of
the directors at the time will continue to be directors of the association
until others are appointed or elected, though some of them may not have
joined in the execution of the articles of association and organization
certificate. Lockivood v. TJie American National Bank, 9 R.I., 308.
9. But even were the oath required, a majority of all who were directors at
the time of the conversion, and not merely a majority of those who take
the oath, are necessary to constitute a quorum. Ib.
10. A national bank, changed from a State bank, may maintain an action on
a continuing guaranty for loans held by it before the change; for loans
both before and after the change. City National Bank of Poughkeepsie
v. Phelps. 97 N. Y., 44; 4? Am. Rep., 513; 3 N. B. C., 627.
11. A State bank paid its president money to reimburse him for money which
he falsely represented he had paid to its creditor. The State bank was
afterwards changed to a national bank, and the creditor recovered judgment against it for his debt. Held, that it could maintain an action
against the president for money had and received, although the State
statute provided that the State bank should be continued a body corporate for three years for the purpose of prosecuting and defending
suits, closing its concerns, and conveying its property. Atlantic National
Bank v. Harris. 118 Mass., 147; 2 N. B. C, 454.
12. The provisions in the sta-tute in New York of April 11,1859 (Laws of 1859,
chap. 236), as to the redemption of circulating notes issued by a State
bank, and the release of the bank if the notes should not be presented
within six years, do not apply to a State bank converted into a national
bank under the act of March 9, 1865, and not " closing the business of
banking." Metropolitan National Bank v. Claggett, 141 U. S., 520.
13. The conversion of a State bank in New York into a national bank, under
the act of the legislature of that State of March 9, 1865 (N. Y. Laws of
1865, chap. 97), did not destroy its identity or its corporate existence,
nor discharge it as a national bank from its liability to holders of its
outstanding circulation, issued in accordance with State laws. Ib.
14. No authority from a State is necessary to enable a State bank to become a
national bank. Casey v. Galli, 94 U. S., 673; 1 N. B. C, 142.
15. The conversion of a State bank into a national bank, under the act of
Congress of June 3rd, 1864, did not work an annihilation or dissolution,
but only a change of the bank. Maynard v. Bank, 1 Brewster, 483.
16. Such change does not adeem a residuary legacy in certain shares of the
bank, limited upon a life estate in such shares which is to become an
absolute one, in case the bank should pay off or refund its stock by
reason of the expiration of its charter or from any other cause. The
change is not^equivalent in law to a paymg off in fact, and the residuary
legatee is entitled to the stock on the death of the legatee for life. Ib.
150
REPORT OF THE COMPTROLLER OF THE CURRENCY.
CONVERSION—Continued.
17. A State statute authorizing the State banking institutions to become
banking associations under the laws of the United States, and providing for the surrender and extinction of their State charter, and " that
said bank, etc., may continue to use its corporate name for the purpose
of protecting and defending suits instituted by or against it, and of
enabling it to close its affairs, but not for the purpose of continuing
under the laws of this State its business," etc., is not in conflict with
the national banking act. Tliomas v. Farmers' Bank of Maryland, 40
Md.,43; 2N.B. C.,248.
CRIMINAL LAW: See False entries; Indictment.
1. The willful misapplication of the moneys and funds of a national banking
association, made an offense by sec. 5209, Rev. St., must be for the use
or benefit of the party charged, or of some person or company other than
the association. United States v. Britton, 107 U. S., 655.
2. It is not necessary that the officer should personally misapply the funds of
the association. He will be guilty as a principal offender though he
merely procures or causes the misapplication. United States v. Fish,
24 Fed. Rep., 585.
3. A loan in bad faith, with intent to defraud the association, is a willful
misapplication within the meaning of the statute. Ib.
4. It is no defense to a charge of embezzlement, abstraction, or misapplication of the funds of a national banking association that the funds were
used with the kiiowledge and consent of the president and some of the
directors. The intent to defraud is to be conclusively presumed from
the commission of the offense. United States v. Taintor, 11 Blatch., 374.
5. If, with intent to defraud the association, an officer allows a firm in which
he is a member to overdraw its account, he will be guilty of misapplying
the funds of the association. In the matter of Van Campen, 2Ben., 419.
6. Allowing the withdrawal of the deposit of one indebted to the association
can not be charged as a misapplication of the money of the association.
United States v. Britton, 108 U. S., 193.
7. It is not a willful misapplication of the moneys of the association within
the meaning of sec. 5209, Rev. St., for a president who is insolvent to
procure the discounting by the association of his note not well secured.
Ib.
8. To constitute the offense of a willful misapplication of the moneys, funds,or credits of the association within sec. 5209, Rev. St., it is not necessary
that the person charged with the offense should have been previously in
the actual possession of such moneys, funds, and* credits under or by
virtue of any trust, duty, or employment committed to him. Nor is it
necessary to the commission of this offense that the officer making the
willful misapplication should derive any personal benefit therefrom.
When the funds or assets of the bank are unlawfully taken from its
possession, and afterwards willfully misapplied by converting them to
the use of any person other than the bank, with intent to injure and
defraud, the offense as described in the statute is committed. United
States v. Harper, 33 Fed. Rep., 471.
9. This criminal act may be done directly and personally, or it may be done
indirectly through the agency of another. If the officer charged with
it has such control, direction, and power of management by virtue of
his relation to the bank as to direct an application of its funds in such
manner and under such circumstances as to constitute the offense of
willful misapplication, and actually makes such direction or causes such
misapplication to be made, he is equally as guilty as if it was done by
his own hands. Ib.
10. The officers of a national banking association may be prosecuted under
State statutes for fraudulent conversion of the property of individuals
deposited with and in the custody of the association. Commonwealth v.
Tenney, 97Mass., 50; State v. Tidier,34 Conn., 280.
11. As the national banking law makes the embezzlement, abstraction, or
willful misapplication of the funds of a national banking association
merely a misdemeanor, a person who procures such an offense to be
committed can not be punished under a State statute which provides
that a person who procures a felony to be committed may be indicted
and convicted of a substantive felony. Commonwealth v. Felton, 101
Mass., 204.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
151
CRIMINAL LAW: See False entries; Indictment—Continued.
12. It is not a conspiracy against United States, under sec. 5440, Rev. St., nor
a willful misapplication of money of bank, under sec. 5209, for president
and director of bank to cause shares of its stock to be purchased with its
money and held on trust. United States v. Britton, 108 U. S., 192.
13. It is not a willful misapplication of bank money by the president, under
sec. 5209, for him to procure the discount by bank for his own benefit
of an unsecured note on which both maker and indorser are insolvent
to his knowledge. Ib., 193.
14. Nor is president liable for a criminal violation of that section solely by
reason of permitting a depositor who is largely indebted to bank to
withdraw his deposits without first paying such indebtedness. Ib.
15. The procuring by two or more directors of the declaration of a dividend
at a time when there are no net profits to pay it is not a willful misappropriation of money of bank within sec. 5204, Rev. St. Ib., 199.
16. Where the president, charged as a trustee with the administration of the
funds of the bank in his hands, converts them to his own use without
authority for so doing, he embezzles and abstracts them within the
meaning of sec. 5209, Rev. St. In the matter of Van Campen, 2 Ben,,
17. To constitute the 6ffense of willful abstraction by an officer, defined by the
statute, it is necessary that the money or funds of the association should
be withdrawn by the officer or by his direction; that such taking or
withdrawing should be without the knowledge or consent of the bank,
or of its board of directors; that the money or funds so taken or withdrawn should be converted to the officer's own use or for the benefit and
advantage of some person other than the association, and that this
should be done with intent to injure and defraud the association. Ib.;
United States v. Harper, 33 Fed. Rep., 471.
18. An officer of a national banking association can not be punished under
State laws for embezzling the funds of the association. Commonwealth
ex rel. Torrey v. Ketner, 92 Penn. St., 372; Commonwealth v. Felton, 101
Mass., 204.
19. But where the offense committed by an officer is properly a larceny of the
funds, and not an embezzlement, he may be indicted under a State law.
Commonwealth v. Barry, 116 Mass., 1.
20. The word " embezzle," as found in the United States Rev. St., is used to
described a crime which a person has an opportunity to commit by reason
of some office or employment, and which may include some breach of
confidence or trust. United States v. Conant, 9 Cent. L. J., 129; 2
N. B. C, US.
21. Section 1025 of the Rev. St. provides: "No indictment * * * shall be
deemed insufficient * * * in a matter of form only. Held, that
anything that forms a part of the description of the crime is not a
*' matter of form." Ib.
22. Embezzlement, abstraction, and willful misapplication of the moneys,
funds, etc., of a national bank, as described in Rev. St., sec. 5209, constitute three separate crimes or offenses, which, under Rev. St., sec. 1024,
may be joined in one indictment, but must be stated in separate counts.
United States v. Cadwallader, 59 Fed. Rep., 677.
23. The exercise of official discretion in good faith, without fraud, for the
advantage or the supposed advantage of the association, is not punishable; but if official action be taken in bad faith, for personal advantage
and with fraudulent intent, it is punishable. United States v. Fish, 24
Fed. Rep., 585.
24. It is competent for a State by penal enactments to protect its citizens in
their dealings with national banking associations located within the
State. State v. Tidier, 34 Conn., 280.
25. And an officer may be punished under State laws for making false entries
in the books of the association with intent to defraud it. I/uberg v.
Commonwealth, 94 Penn. St., 85.
26. Purchase of stock in violation of sec. 5201, Rev. St., made with intent to
defraud, and by officers named in sec. 5209, is not punishable under latter section. United States v. Britton, 107 U. S., 655.
27. Rev. St., sec. 5209, relating to national banks, provides that officers or agents
thereof who willfully misapply any of its moneys, or who make any
false entry or reports with intent to injure or defraud it, or to deceive
any officer of a bank, or any agent appointed to examine its affairs, and
152
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CRIMINAL LAW: See False entries; Indictment—Continued.
" every person " who, with like intent, aids or abets any officer or agent
in any violation of the section, shall be guilty, etc. Held, that persons
not officers or agents of a national bank may be aiders and abettors of
the president of the bank in violation of such statute. Coffin Vc United
States, IS S Ct.,394.
28. Acts eighteenth general assembly, chap. 153, sees. 1 and 2, making it a
felony for "any officer "of a bank to receive deposits with knowledge
that the bank is insolvent, apply to officers of national as well as other
banks. State v. Fields (Iowa), 62 N. W.9 653.
29. Acts eighteenth general assembly, chap. 153, sees. 1 and 2, making it a
felony for "any officer" of a bank to receive deposits with knowledge
that the bank is insolvent, are not void, in so far as they apply to
national-bank officers, as an attempt to control and regulate the operations of national banks. Ib.
30. An indictment under Rev. St., sec. 5209, for willfully misapplying the
moneys, funds, and credits of a national bank of which defendant was
president, as well as a director and agent, must supplement the allegation of willful misapplication by allegations showing how the misapplication was made, and that it was an unlawful one. Batchelor v.
United States, 15 S. Ct., 446.
31. If much the larger number of the jury are for conviction, a dissenting juror
should consider whether a doubt in his own mind is a reasonable one
which makes no impression upon the minds of others equally honest and
equally intelligent with himself, who have heard the same evidence with
an equal desire to arrive at the truth, and under the sanction of the same
oath. On the other hand, if a majority are for acquittal, the minority
ought to seriously ask themselves whether they may not reasonably, and
ought not to, doubt the correctness of a judgment which is not concurred
in by most of those with whom they are associated, and to distrust the
weight and sufficiency of that evidence which fails to carry conviction
to the minds of their fellows. United States v. Allis, 73 Fed. Rep., 165.
32. An indictment under Rev. St., 1889, section 3581, charging a bank officer
with receiving a deposit knowing that the bank was insolvent, is not
defective because each count concludes with the words "did take, steal,
and carry away." State v. Sattley {Mo. Sup.), 33 S. W., 41.
33. Rev. St., 1889, § 3581, providing that any bank officer who shall receive or
assent to the reception of a deposit, or who shall create or assent to the
creation of any indebtedness by the bank knowing that it is in a failing
condition, shall be guilty of larceny, and punished, etc., sufficiently prescribes the nature of the crime, as required by Const., art. 12, § 27. Ib.
34. The receiving of a deposit, and issuing of a certificate therefor, creates " an
indebtedness," within Rev. St., 1889, § 3581, making it a crime for any bank
officer to create or assent to the creation of any indebtedness by the bank,
knowing its insolvency, etc. Ib.
35. On the trial of a bank officer for receiving deposits knowing that the bank
was insolvent, evidence that depositors demanded their money, and of
the refusal of the bank employees to pay them, is admissible, whether or
not defendant personally heard the demands, to show the failure of the
bank to meet its obligations in the ordinary course of business. Ib.
36. If a bank employee, by authority of his superior officer, given before the
latter had knowledge that the bank was insolvent, receives a deposit
after its insolvency, such officer, unless he revoked the authority after
he became aware of the condition of the bank, will be liable to prosecution under Rev. St., 1889, § 3581, making it a crime for a bank officer to
assent to the receipt of a deposit knowing that the bank is in failing
circumstances. Ib.
37. An instruction, in the language of the statute, that the failure of the bank
"is prima facie evidence.of knowledge on the part of its cashier that
the sa,me was in failing circumstances," coupled with a statement that
' * prima facie evidence is such that raises such a degree of probability in
its favor that it must prevail unless it be rebutted or the contrary
proved," is not erroneous. Ib.
38. Where an indictment under Rev. St., 1889, § 3581, contains a count for
receiving a deposit knowing that the bank is insolvent, and another
count for assenting to the creation of an indebtedness by the bank with
such knowledge, and the evidence shows but one transaction, which consisted in receiving a deposit and issuing a certificate therefor, a general
verdict of guilty, without specifying on which count, is sufficient. Ib.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
153
CRIMINAL LAW: See False entries; Indictment—Continued.
39. Two or more persons, partners as bankers, may jointly commit the crime
of receiving deposits with knowledge that they and the bank are insolvent. State y. Smith {Minn.), 64. N. W., 1022.
40. On trial of an indictment of a banker for receiving deposits when insolvent, it was proper to charge that, though the deposit was received by
defendant's son after defendant had instructed him to refuse deposits,
if defendant, on learning that the deposit was so received, placed it among
the funds of the bank, he " knowingly accepted and received" it within
the statute. State v. Eifert (Iowa), 65 N. W., 309.
41. Where there has been no administration on the estate of a deceased insolvent who had fraudulently conveyed his property in his lifetime, a
simple contract creditor is not debarred from filing a bill against the
fraudulent grantee to subject the property fraudulently conveyed to
the satisfaction of his claim. Merchants' Nat. Bank v. MeOee {Ala.),
19 So., 356.
42. One who has an interest in a company for the benefit of which the president of a national bank criminally misapplies its funds may be guilty as
an aider and abettor in such misapplication, although the president has
no interest in or relation to him or to said company, and although he
has no interest in the bank, or with the president thereof, of any kind.
State v. Teahan, 50 Conn., 92, distinguished; Coffin v. United States, 16
s. at., 94s.
43. It is not necessary to the guilt of aiders and abettors who are not officers
of the bank that they should have a common purpose with the principal to subserve joint interests with him by the misapplication of the
bank's funds. Ib.
44. Persons who have no official relation to a national bank may be indicted,
under Rev. St., § 5209, as aiders and abettors of some officer of the bank
in the criminal misapplication of its funds, or in the making of false
entries in its books. Ib.
45. If a violation of the statute is committed by an officer of the bank and by
an outsider, the officer must be prosecuted as the principal, and the
other can only be prosecuted, under the terms of the statute, as an aider
and abettor. Ib.
46. An indictment charging the aiding and abetting of an officer of a national
bank in making false entries, etc., is not defective because it charges
the principal offender with having made the false entries with intent to
injure and defraud the bank, and also with intent to deceive agents
appointed to examine the bank's affairs, whereas it merely charges the
aider and abettor with an intent to deceive such agents; for it is immaterial that the principal offender may have had several intents, if both
principal and aider and abettor were actuated by the criminal intent to
deceive such agents. Ib.
47. An indictment for aiding and abetting one H., the president of a bank, in
the criminal misapplication of its funds, charged that, on a specified
date, the said H. misapplied a named sum, by causing the same to be
paid out on the checks of a company having no moneys in the bank.
The aiding and abetting clause charged that the accused did " on [specifying the same date] aid and abet said H., as aforesaid, to wrongfully,"
etc., misapply the moneys of the bank, " to wit," specifying an identical
sum. Held (overruling a contention that the words "said" and "as
aforesaid" did not refer to the same moneys previously charged to have
been misapplied by the president), that the language sufficiently connected the acts charged against the aider and abettor with the offense
stated against the principal. Ib.
48. An indictment for violating the national banking laws averred that the
bank in question had been "heretofore" created and organized under
the laws of the United States. Held, that even if it were assumed that
the word should have been "theretofore," in order to make it certain
that the bank had been incorporated prior to the finding of the indictment, the result was only an imperfect statement of what the law implies
to be true after verdict. Ib.
49. On the trial of persons charged with aiding and abetting the president of
a national bank in criminally misapplying its funds and making false
entries in its books, the court charged that if the jury were satisfied that
the president did knowingly and purposely make, or cause to be made,
the false entries as charged, they could not find the defendants guilty as
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REPORT OF THE COMPTROLLER OF THE CURRENCY.
CRIMINAL LAW: See False entries; Indictment-—Continued.
aiders and abettors, unless they were satisfied that defendants, " w i t h
like intent, unlawfully and knowingly did or said something showing
their consent to, and participation in, the unlawful and criminal acts "
of the said president,' ; and contributing to their execution." Held, that
this language was not open to the objection that the expression " unlawful and criminal acts " might have been understood as relating to unlawful and criminal acts of the president generally. Ib.
50. Under Rev. St., § 3531, making it a crime for any bank officer to " receive
or assent" to the reception of any deposit of money, knowing the bank
to be insolvent, a conviction can not be had on an indictment charging
merely that defendant" did receive" the deposit, on proof of an "assent"
to the reception of the deposit. State v. Wells (Mo. Sup. ),85 S.W., 615.
51. An indictment against its president for defrauding a national bank,
described the bank as the '-National Granite State Bank," " carrying on
a national banking business at the city of Exeter." The evidence
showed that the authorized name of the bank was the *' National Granite State Bank of Exeter." Held, that the variance was immaterial.
Putnam v. United States, 162 U. 8., 6S7.
52. Conversations with a person took place in August, 1893. In December,
1893, he testified to them before the grand jury which found the indictment in this case. On the trial of this case his evidence before the grand
jury was offered to refresh his memory as to those conversations. Held,
that that evidence was not contemporaneous with the conversations, and
would not support a reasonable probability that the memory of the witness, if impaired at the time of the trial, was not equally so when his
testimony was committed to writing; and that the evidence was therefore inadmissible for the purpose offered. Ib.
53. On the trial of a national-bank president for defrauding a bank, a witness
for the Government was asked, on cross-examination, as to the amount
of stock held by the president. This being objected to, the question was
ruled out as not proper on cross-examination, the Government " not
having opened up affirmatively the ownership of the stock." Held, that,
as the order in which evidence shall be produced is within the discretion of the trial court, and as the matter sought to be elicited on the
cross-examination for the accused was not offered by him at any subsequent stage of the trial, no prejudicial error was committed by the
ruling. 1b.
54. When an offense against the provisions of Rev. Stat., section 5209, is begun
in one State and completed in another, the United States court in the
latter State has jurisdiction over the prosecution of the offender. Ib.
55. The proof of guilt in this case was sufficient to warrant the court in leaving to the jury to decide the question of the guilt of the accused. Ib.
56. The sentence on both counts having been distinct as to each, the entire
amount of punishment imposed will be undergone, although the conviction and sentence as to the second count are set aside. Ib.
57. Coffin v. United States, 156 U. S., 432, affirmed on the following points:
(1) That the offense of aiding or abetting an officer of a national bank
in committing one or more of the offenses set forth in Rev. Stat., section
5209, may be committed by persons who are not officers or agents of the
bank, and consequently it is not necessary to aver in an indictment
against such an aider or abettor that he was an officer of the bank or
occupied any specific relation to it when committing the offense; (2)
that the plain and unmistakable statement of the indictment in that
case and this, as a whole, is that the acts charged against Haughey
were done by him as president of the bank, and that the aiding and
abetting was also done by assisting him in the official capacity in which
alone it is charged he misapplied the funds. Coffin v, United States,
162 U. S., 664.
58. Instructions requested may be properly refused when fully covered by the
general charge of the court. Ib.
59. When the charge, as a whole, correctly conveys to the jury the rule by
which they are to determine, from all the evidence, the question of
intent, there is no error in refusing the request of the defendant to single out the absence of one of the several possible motives for the commission of the offense and instruct the jury as to the weight to be given
to this particular fact independent of the other proof in the case. Ib.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
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CRIMINAL LAW: See False entries; Indictment—Continued.
60. The refusal to give, when requested, a correct legal proposition does apt
constitute error, unless there be evidence rendering the legal theory
applicable to the case. Ib.
61. When it is impossible to determine whether there was evidence tending
to show a state of facts adequate to make a refused instruction pertinent,
and there is nothing else in the bill of exceptions to which the stated
principle could apply, there is no error in refusing it. Several other
exceptions are examined and held to be without merit. Ib.
62. A bank president, not acting in good faith, has no right to permit overdrafts when he does not believe, and has no reasonable ground to believe,
that the moneys can be repaid; and, if coupled with siich wrongful act
the proof establishes that he intended by the transaction to injure and
defraud the bank, the wrongful act becomes a crime. Ib.
63. When the principal offender in the commission of the offense, made criminal by Rev. Stat., section 5209, and the aider and abettor were both
actuated by the criminal intent specified in the statute, it is immaterial
that the principal offender should be further charged in the indictment
with having had other intents. Ib.
64. The first clause of section 5209 of the Revised Statutes provides for three
distinct offenses: First, embezzlement; second, abstraction; and, third,
wilful misapplication of the moneys, funds, or credits of the bank by
any president, director, cashier, teller, clerk, or agent of any association organized as a national banking association. United States v. Lee,
12 Fed. Rep., 816.
65. It was the intention of Congress to make criminal the misapplication and
conversion of the funds of national banking associations without regard
to whether or not the party so misapplying received any of the funds or
other advantage, directly or indirectly. Ib.
66. If it appears that the funds of the banking association have been abstracted
or willfully misapplied by defendant, he is precluded from denying that
it was done with unlawful intent. Ib.
67. It is not a necessary ingredient of the offense of making a false entry in a
report under Rev. St., § 5209, that the report shall be one of those mentioned in sections 5211, 5212, or one which the bank is bound by law to
make. It is sufficient if the report is one made in the due course of
business. United States v. Potter, 56 Fed. Hep., 83, 97, disapproved;
United States v. Booker, 80 Fed. Rep., 376.
68. When it is made to appear to the court during the trial of a criminal case
that, either by reason of facts existing when the jurors were sworn, but
not then disclosed andknown to the court, or by reason of outsi de influences
brought to bear on the jury pending the trial, the jurors, or any of them,
are subject to such bias or prejudice as not to stand impartial between
the Government and the accused, the jury may be discharged and the
defendant put on trial by another jury; and the defendant is not thereby
twice put in jeopardy, within the meaning of the fifth amendment to
the Constitution of the United States. Simmons v. United States, 142
U.S., 148.
69. The judge presiding at a trial, civil or criminal, in any court of the
United States may express his opinion to the jury upon the questions
of fact which he submits to their determination. Ib.
70. An indictment on Rev. Stat., sec. 5209, is sufficient which avers that the
defendant was president of a national banking association; that by
virtue of his office he received and took into his possession certain bonds
(described), the property of the association, and that, with intent to
injure and defraud the association, he embezzled the bonds and converted them to his own use. Claasen v. United States, 14% U. S., 140.
71. In a criminal case a general judgment upon an indictment containing
several counts and a verdict of guilty on each count cannot be reversed
on error if any count is good and is sufficient to support the judgment.
Ib.
72. Upon writ of error no error in law can be reviewed which does not appear
upon the record or by bill of exceptions made part of the record. Ib.
73. Under sec. 5 of the act of March 3,1891, entitled "An act to establish circuit courts of appeals, and to define and regulate in certain cases the
jurisdiction of the courts of the United States, and for other purposes,"
a writ of error may, even before July 1,1891, issue from this court to a
156
REPORT OF THE COMPTROLLER OF THE CURRENCY.
CRIMINAL LAW: See False entries; Indictment—Continued.
circuit court in the case of a conviction of a crime under sec. 5209 of
the Revised Statutes where the conviction occurred May 28,1890, but a
sentence of imprisonment in a penitentiary was imposed March 18,1891.
In re Claasen, 14-0 U. 8., 200.
74. A crime is "infamous" under that act where it is punishable by imprisonment in a State prison or penitentiary whether the accused is or is not
sentenced or put to hard labor. Ib,
75. Such writ of error is a matter of right, and under sec. 999 of the Revised
Statutes the citation may be signed by a justice of this court as an
authority for the issuing of the writ under sec. 1004. Ib.
76. At the time of the conviction no writ of error from this court in the case was
provided for by statute, nor was any bill of exceptions, with a view to a
writ of error, provided for by statute or rule, and therefore a mandamus
will not lie to the judge who presided at the trial to compel him to settle
a bill of exceptions which was presented to him for settlement after the
sentence, nor^can the minutes of the trial, as settled by the judge by consent, and signed by him, and printed and filed in July, 1890, and on which
a motion for a new trial was heard in October, 1890, be treated by this
court, on the return to the writ of error, as a bill of exceptions properly
forming part of the record. Ib.
77. A criminal court in the southern district of New York, sitting as a circuit
court therein, under sec. 613 of the Revised Statutes, and composed of
the three judges named in that section, to hear a motion for a new trial
and an arrest of judgment, in a criminal case previously tried by a jury
before one of them, is a legally constituted tribunal. Ib.
78. A justice of this court on allowing such writ and signing a citation had
authority also to grant a supersedeas and stay of execution. Ib.
79. Upon a plea of guilty to three indictments found under section 5209, Rev.
St.. U. S., one for the misapplication of funds of a national bank by the
accused while cashier thereof, one for false entries to conceal such misapplication, and the third for making a false statement with intent to
deceive the examining officers, the district court pronounced sentence
upon the accused as follows: "That the prisoner be confined at hard
labor in the State's prison of the State of New Jersey for the term of
five years upon each of the three indictments above named, said terms
not to run concurrently, and from and after the expiration of said
terms until the costs of this prosecution shall have been x>aid." Held,
that the words "said terms not to run concurrently" are uncertain and
incapable of application, and therefore void; ana that the sentences
commenced at once, and ran concurrently. United States v. Patterson,
Keeper, etc., 29 Fed. Rep., 775.
80. The judgment of the district and circuit courts of the United States in
criminal cases is final, and can not be reviewed by writ of error; but if
a judgment, or any part thereof, is void, either because tlie court that
renders it is not competent to do so for want of jurisdiction, or because
it is rendered under a law clearly unconstitutional, or because it is
senseless and without meaning, and can not be corrected, or for any
other cause, the party imprisoned by virtue of such judgment may be
discharged on habeas corpus. Ib.
81. On a habeas corpus the decision should be made upon the actual status of
the case at the time of the decision, and not according to the state
of things when the writ was allowed. When, at the time the writ
of habeas corpus for the discharge of a prisoner, under three sentences of
five years each running concurrently, was allowed, the first term of five
years had not expired by lapse, although at least one of the sentences
had been satisfied by means of remissions for good conduct. Held, that
the five years having entirely elapsed since the allowance of the writ,
the question of the applicability of the remission for good conduct to all
the sentences may be waived, and the prisoner discharged. Ib.
82. When an officer of a national bank, indicted under Rev. St., § 5209. for
making false entries in a report of the condition of such bank in respect
to amounts of overdrafts and of loans and discounts, has testified that
certain overdrafts, in respect to which the depositors had consulted the
bank officers and obtained permission to overdraw, were treated by the
officers and directors of the bank as temporary loans, and were reported
by him among loans, and not among overdrafts, in the belief that they
might properly be so reported, it is error to charge the jury that the
REPORT OF THE COMPTROLLER OF THE CURRENCY.
157
CRIMINAL LAW: See False entries; Indictment—Continued.
defendant was required by law to place under the heading'' Overdrafts,"
in the report, all sums drawn out by depositors in excess of their deposits,
and that the transfer of any such sums to the heading * * Loans and discounts " was the making of a false entry, since such charge takes from
the jury the right to consider, upon the question of intent, the explana
tion given by the defendant, while, if they believed such explanation and
that the defendant acted in good faith, the entries were not false within
the meaning of the statute. Mr. Justice Harlan dissenting. Graves v.
United States, 165 U. 8., 323.
S3. Where a transaction by a national-bank officer with intent to defraud is
entered on a deposit slip, entry of the contents of such slip upon the
books of the bank by him, or by his direction, is making a " false entry,"
within Rev. St. § 5209. Agnew v. United States 165 U. S., 36.
84. On trial of the president of a bank for conversion of its funds, the cashier,
who has testified as a witness for defendant, may be asked, on crossexamination, whether he did not resign because of transactions of the
defendant similar to that charged in the indictment. Ib.
85. The evidence showed that defendant, president of a national bank, without authority of the directors, purchased $20,000 bonds, of little value,
at a great discount, and had them placed in the assets of the bank, and
to his credit at face value, giving his written guaranty for the principal
and interest, which, by reason of his financial condition, was almost
worthless. Held, that it was not error to refuse to charge that, from
the guaranty, the jury might find that there was no intent to defraud
the bank. Ib.
86. A charge to the effect that if defendant, a bank president, purchased bonds
which were worthless, or of but little value, placed them among the
assets of the bank at a greatly exaggerated value, and had such exaggerated value placed to his own credit, these facts create a presumption
of an intent to defraud the bank, which " throws the burden of proof
upon the defendant," and that evidence to overcome the presumption
"must be sufficiently strong to satisfy you beyond a reasonable doubt
that there was no such guilty intent," is not error, where the character
of such evidence and the nature of a reasonable doubt are sufficiently
explained in other portions of the charge. Ib.
87. A charge that if the defendant "either embezzled or willfully misapplied"
the funds or credits of the bank, "whereby, as a necessary, natural, or
legitimate consequence, its capital was reduced, or placed beyond the
control of the directors, or its ability to meet its engagements or obligations, or to continue its business, was lessened or destroyed, the intent
to injure or defraud the bank may be presumed," is correct. Ib.
88. It is not reversible error to refuse to charge* that, if defendant used the
proceeds of a check belonging to the bank, and which he had caused to
be placed to his credit, in the payment of a debt of the bank, the jury
must find that he did not fraudulently embezzle the amount, especially
where defendant's explanation of the transaction is unsatisfactory. Ib.
89. Evidence of the commercial rating of a president of a bank at the time of
an alleged conversion by him of its funds, by purchasing for the bank,
without authority, and having placed to his credit, worthless bonds,
which he had guaranteed; and the testimony of the cashier of another
bank as to whether, at the time of the transaction, he considered defendant's guaranty for such an amount good, are irrelevant. Ib.
DEPOSITS:
1. The relation of banker and depositor is that of debtor and creditor.
Deposits on general account belong to the bank and are part of its general fund. The bank becomes a debtor to the depositor to the amount
thereof, and the debt can only be discharged by payment to the depositor, or pursuant to his order. The JStna National Bank v. The Fourth
National Bank, 46 N. Y., 82.
2. The contract has none of the elements of a trust. For a breach on the part
of the bank of the obligation resulting from the relation between the
parties the depositor alone can sue. Ib.
3. General deposits in a commercial bank on account of the depositor, without being complicated by any other transaction than that of the depositing and withdrawing of the moneys, transfers the ownership of the
money to the bank; and the relationship with reference thereto, as
158
REPORT OF THE COMPTROLLER OF THE CURRENCY.
DEPOSITS—Continued.
between the bank and the depositor, is simply that of debtor and creditor. Collins y. State, 15 So., 214.
4. A deposit made in the usual course of business vests in the bank, and can
not be recovered by the depositor on the ground of fraud, though the
bank was insolvent and failed on the next day, and though the deposit
was made in reliance on representations of the president that the bank
was all right, unless the officers of the bank knew of its insolvency at
the time of the deposit. Neiv York Breweries Co. v. Higgins, 29 N. Y.
S., 416.
5. A trustee who deposits in a bank and causes to be credited to his private
account money of the trust fund without giving any notice that it is not
his private property or making any special agreement in regard to it,
thereby converts it to his own use; so that the bank, in the absence of
any notice that it is not his private property, may apply it as such.
School Distinct v. First National Bank, 102 Mass,, 174*
6. Where an agent deposits in a bank, to his own account, the proceeds of
property sold by him for his principal under instructions thus to keep it,
a trust is impressed upon the deposit in favor of the principal, and his
right thereto is not affected by the fact that the agent at the same time
deposits other moneys belonging to himself; nor is it affected by the fact
that the agent, instead of depositing the identical moneys received by
him on account of his principal, substitutes other moneys therefor. Van
Allen v. The American National Bank, 52 N Y., 1.
7. Where an agent or trustee has deposited money belonging to his principal
or beneficiary in a bank to which he is himself indebted, and the bank,
without his authority and in ignorance of the true ownership of the fund,
has applied it on the debt, the owner is not debarred from recovering it
from the bank if it can be identified. Burtnett, Adm'r, v. The First
National Bank, 38 31ich.f 630.
8. A bank is not chargeable with interest on sums deposited to the credit of
customers to be drawn against by check until payment be demanded,
unless upon special contract. Parkersburg National Bank v. Als., 5 W.
Va., 50.
9. Unlike checks, cash deposited by customers with the bank ceases to be the
property of the depositor, and becomes the property of the bank, creating
at once the relationship of debtor and creditor. Balbach et al. v. FreHngJniysen, Receiver, etc, 15 Fed. Rep., 675.
10. Plaintiff made a certain payment to defendant bank, and received in
exchange a note signed by a firm composed of the officers of the bank,
and the business of which was transacted in the bank's office. He subsequently gave a check to his wife, which was also exchanged at the
bank office for a similar note. Plaintiff and his wife could both read
and write, and had transacted considerable business with the banks.
Plaintiff retained the notes for two years, and upon the failure of the
firm began suit to re-form the notes and change them into certificates
of deposit of the bank on the ground that he intended to deposit his
money with the bank. Held, that plaintiff was not entitled to a decree.
Murphy v. First National Bank (Iowa), 63 N. W., 702.
11. Where several deposits in bank have been made on the same account, and
the title to one of the deposits is disputed, checks drawn on the account
will be first applied to the deposits not in dispute. * Hauptmann v. First
National Bank (Sup.), 31 N. Y. S., 364.
12. Testimony that the cashier of a bank failed to enter deposits on its books
is not admissible as against the depositor to show that the deposits were
made with the cashier in his individual capacity. UHerbette v. Pittsfield
National Bank (Mass.), 38 N. E., 368.
13. An envelope, on which the sums paid into and drawn out of a bank by a
depositor are entered by the cashier, is admissible against the bank to
show the state of his account. Ib.
14. A national bank, not designated as a depository of public moneys, which
receives, under the permissive authority of law and the regulations of the
Post-Office Department, deposits of money made by postmasters in their
official capacity, thereby assumes a fiduciary relation to the Government, and becomes a bailee of the Government, so as to become directly
responsible to it for any moneys which it knowingly or negligently allows
the postmaster to withdraw by private check, or otherwise appropriate
to his own use; and where, "after the removal of the postmaster, he
REPORT OF THE COMPTROLLER OF THE CURRENCY.
159
DEPOSITS—Continued.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
deposits a sum to make good a shortage in his balance, the bank can not
apply it in discharge of a debt due it from him personally. United
States v. National Bank of Asheville et al., 73 Fed. Bejj., 379.
By reason of this trust relation, equity has jurisdiction of a bill by the
Government to require an account and settlement of the moneys so
deposited with it; and this remedy is not affected by the fact of a cumulative remedy at law against the postmaster on his official bond. Ib.
Where a bank knows that money deposited with it to the general credit of
a depositor is held in trust by such depositor, the bank has no right to
apply such deposit to the payment of a note due to it from the depositor;
57 111. App., 107, reversed. Clemmer v. Drovers' Nat. Bank (III. Sup.), 41
N.E.,728.
An indictment under a statute declaring it an offense if an officer of a bank
shall receive a deposit, ''knowing, or having good reason to believe, the
establishment to be insolvent," is not sufficient where it does not allege
the insolvency, but merely follows the words of the statute, as there
would be no offense if the bank was not insolvent, though the officer
believed it was. State v. Bardwell (Miss.), 18 So., 377.
Where one mails to a bank money and checks for deposit, but the bank
refuses to acknowledge receipt thereof, and persistently denies such
receipt, the relation of depositor and depositee is not created* Miller v.
Western Nat. Bank (Pa. 8up.)9 33 A., 684.
Where a bank positively and repeatedly denies one's right to make any
claim upon it in respect of currency and checks mailed by him to it for
deposit, the depositor need not make demand before bringing suit on
account of siich deposit. Ib.
On trial on an indictment under Comp. St. 1895, \\ 637, 688, for receiving
a deposit in an insolvent bank, defendant offered to show that the
deposit was made by a customer whose account was at the time overdrawn in an amount larger than the deposit. Held, that the evidence
was admissible as tending to show that the deposit was made and
accepted as an application on the depositor's indebtedness to the bank.
Nichols v. State (Neb.), 65 N. W., 774.
When a customer of a bank who has overdrawn his account makes a
deposit, the presumption is, in the absence of evidence, that the deposit
was general, and was made and received toward the payment of the
overdraft. Ib.
A bank depositor, on rumors of its insolvency, went to withdraw his
deposits, but was informed by the vice-president and director that the
bank was perfectly solvent, and that'' we have got all the money you
want. You need never have any fears of this bank as long as I am in
it." Such depositor, relying on such representations, permitted his
deposits to remain. It was in fact insolvent when the representations
were made. Held, that such vice-president and director was personally
liable to such depositor for the money lost by the failure of the bank.
Townsend v. Williams (N. C.),23 S. E., 461.
A person deposited money with a bank, taking from it a deposit slip in the
form used for general deposits. Upon such slips were the words,
"Security for signing bond to be held by bank." Subsequently the
depositor, in order to change the security so the $700 would be available
for one purpose and §800 for another, drew an ordinary check, which
was marked "Paid," and a certificate of deposit for $800 made out, to be
held by the surety, and $700 to secure other bondsmen. The first-named
certificate was afterwards paid by the bank. The depositor testified that
the deposit was a special one. Held, a general deposit and not a trust
fund in the hands of a receiver. Dearborn v. Washington Sav. Bank
(Wash.), 42 P., 1107; Watson v. Sheafe, ib.
A deposit made in a bank at a time when the officers knew that it was
insolvent can not be recovered from the assignee unless it can be identified and traced into his hands. In re Commercial Bank (Ct.Insolv.),2
Ohio N. P., 170.
In an action by a bank to recover money advanced on a draft, for goods
sold, deposited with it by the vendor, where it claims that the deposit
was made for collection, arid the depositor that it was a sale, it is proper
to instruct that if it was a sale the bank could not recover, though
there is evidence-that the vendee, after the deposit, paid part of the price
for which the draft was drawn directly to the vendor. Bank of Guntersville v. Webb (Ala.), 19 So., 14.
160
REPORT OF THE COMPTROLLER OF THE CURRENCY.
DEPOSITS—Continued.
26. An instruction that if an illiterate depositor, to whom a bank cashier
fraudulently gave a deposit slip showing a deposit of a draft for collection instead of as a discount, "within a reasonable time, and on his first
opportunity," repudiates the transaction as shown by the slip, would make
no difference, is not objectionable as leaving to the jury the question of
reasonable time. Ib.
27. Where a bank cashier, in receiving from an illiterate person a draft sold to
the bank, fraudulently makes out his deposit slip for him so as to show
a deposit for collection,«and the depositor subsequently, on discovering
the fraud, repudiates the transaction as a deposit for collection, and, on
an issue as to whether the transaction was a purchase or a deposit for
collection, the bank admits that the slip was a receipt for the draft, and
the depositor claims that it was one for the proceeds, it is proper to refuse
to instruct for the bank that the retention of the slip by the depositor
after repudiation, and using it as evidence of its demand against the
bank, rendered it binding on him. Ib.
38. Where a bank cashier, in receiving from an illiterate person a draft sold
to the bank, fraudulently makes out his deposit slip for him so as to
show a deposit for collection, it is error to admit evidence that the bank
required the cashier to pay the draft on failure to collect it, on the issue
as to whether the bank was liable as purchaser or as a receiver for collection only. Ib.
39. On an issue as to whether the delivery of a draft to a bank was a purchase
or a deposit for collection, the depositor may testify to his illiteracy to
explain his accepting the deposit slip; and, having on cross-examination
given the name of the person who first informed him of its contents, he
may testify when and where the information was given. Ib.
30. One who draws a check on a bank in which he has sufficient funds for its
payment, not encumbered by an earlier lien in favor of the bank, may
sue such bank for damages on its refusal to pay the check to the drawee.
Mt. Sterling Nat. Bank v. Green (Ky.), 35 S. W., 911.
31. A bank may properly refuse to honor the check of a depositor who is
indebted to it on a past-due note for an amount greater than the sum on
deposit. Ib.
32. The duty which a bank holding a note owes to an indorser thereon, to
appropriate a deposit in the bank to payment of the note, exists, only
where the maker of the note, at its maturity, has a deposit sufficient to
pay it, and not previously appropriated to any other purpose, and does
not apply to a deposit made after the maturity of the note, or to a deposit
by a prior indorser, though he be in fact the principal debtor, and the
maker be an accommodation maker. First Nat. Bank v. Peltz (Pa.
Sup.), 35 A., 218.
33. Decedent deposited bonds and coupons with a bank, and took a writing,
signed
by the cashier, acknowledging their receipt, and that they were
<4
to be sold, and the proceeds placed to her credit." Held, that a delivery of the receipt, with an indorsement thereon, signed by decedent,
requesting the cashier t o ' ' let" plaintiff '' have the amount of the within
bill," and with the intention to pass title thereto, constituted a valid
gift of the money due from the bank. Crook v. First Nat. Bank (Wis.),
52 N. W.y 1131.
34 A deposit slip issued by a banker, acknowledging the receipt of the amount
of money therein named, is intended merely to furnish evidence, as
between the depositor and the bank, that on a given day there was
deposited a given sum, and not that such sum remains on deposit, and
hence the delivery of a deposit slip to a third person by the depositor
does not operate as an assignment of the deposit. First Nat. Bank v.
Clark (N. Y. App.), 32 N. E., 38.
35. A conversation between a bank depositor and a third person, to whom he
had delivered the deposit slip, and in whose favor he had drawn a check
for the amount, in which he stated that the deposit would not be available for ten days, and that he wanted the check discounted immediately,
which was accordingly done, and the money paid him by such third
person, does not, as a matter of law, operate as an assignment of the
deposit to such third person; and a finding by the jury that it'did not
will not be disturbed on appeal. Ib.
36. Designating a national bank as a depositary of public moneys does not constitute it an agent of the Government, or render the Government liable
REPORT OF THE COMPTROLLER OF THE CURRENCY.
161
DEPOSITS—Continued.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.
for moneys lost by a failure of such bank. Branch v. TJie United States,
1 N. B. C., SOS.
Such bank does not become a custodian of public moneys deposited witli
it, but it becomes a debtor to the United States the same as it does to
other depositors for individual deposits. Ib.
Certain moneys coming into the possession of the clerk of a Federal court
pending a litigation were by him deposited in a national bank which
had been designated as.a depositary of public moneys. The bank failed.
Held, that the United States were not liable for the money so deposited,
Ib.
Defendant, who had money on deposit in a national bank, when demanding payment thereof, was induced by an officer of the bank to sign a
promissory note, which was represented to him to be a receipt for the
money. He was unable to read English. Held, that he was not liable
to the bank upon the note. Resh v. First National Bank of Allentown,
OS Penn. St., S97; S N. B. C, 724.
Plaintiff, who was unable to read, deposited money in a national bank and
took a certificate of deposit therefor, which the officers of the bank represented was a certificate of the bank. It was, on its face, the certificate
of a private banking firm, composed of some of the officers of the bank.
Held, that the bank was liable for the amount of the deposit. Zeigler
v. First National Bank of Allentown, 93 Penn. St., 393; 39 Am. Rep., 758;
3 N. B. C, 721.
Where the officers of a bank, when they received a deposit which they
applied to the payment of a debt due from the depositor to the bank,
knew or had reason to believe that the deposit contained moneys belonging to others, for whom the depositor was but the agent or factor, the
persons who were in. equity the owners of the money were entitled to
recover it from the bank. Union Stock Yards Nat. Bank v. Moore et al.,
79 Fed. Rep., 705.
A postmaster at Lewiston, Idaho, with intent to defraud the Government»
and without receiving any money, issued post-office orders upon the
postmaster at Pueblo in favor of the Stockgrowers' Bank. He mailed
the orders to the bank with a letter purporting to be written by one
Wilson, and directed the bank to draw the money and hold it subject to
said Wilson's order. The bank, without knowledge of the fraud, obtained
the money as directed, but in doing so acted as a principal without disclosing their agency in the matter. The Lewiston postmaster, under
the name of Wilson, subsequently drew the greater part of the money
from the bank, and suit was afterwards brought against it by the United
States to recover the money so obtained on the order. Held, that the
bank was liable. United States v. Stockgrowei^ Nat. Bank of Pueblo,
30 Fed. Reg., 912.
Money deposited in a bank without stipulation as to place of payment is
payable to the depositor at the bank. McBee v. Purcell Nat. Bank
(Indian Ter.), 37 S. W., 55.
Where, after the maturity of a promissory note held by a bank, and due
protest and notice thereof, the maker makes a general deposit in the bank
of an amount sufficient to pay the note, this does not of itself, as between
the bank and an indorser, operate as a payment. In the absence of any
express agreement or directions it is optional with the bank whether or
not to apply the money in payment; it is under no legal obligation so to
do. The National Bank of Newburgh, respondent, v. Daniel Smith, appellant, 66 N. Y, 271.
The mere discounting of paper, and placing the amount thereof to the
credit of a depositor who already has a large balance to his credit, does
not make the bank a purchaser for value so as to protect it against infirmities in the paper. Entering the amount of the discount to the credit of
the depositor simply creates the relation, between the bank and the
depositor, of debtor and creditor; and as long as that relation remains
and the deposit is not drawn out the bank has simply promised to pay
the depositor, has parted with no value, and is not entitled to the protection of a bona fide holder of paper. Ib.
A trust can not be implied from a mere deposit in a bank by one person of
his own money in the name of another. Beaver v. Beaver (N. Y.). 22
N. E., 940; 117 N. Y, 421.
Although the relation between a bank and its depositor is that merely of
H. Doc. 10
11
162
REPORT OF THE COMPTROLLER OF THE CURRENCY.
DEPOSITS—Continued.
debtor and creditor, yet the fund does not change its character from the
fact that the money has been deposited in bank to the credit of the depositor. If the money in his hands was impressed with a trust in favor of
another the deposit will remain subject to the same trust. Third Nat.
Bank v. Stilhcaier Gas Co., SO N. W., 440; '36 Minn., 75.
48. A firm made an assignment, parts of its assets consisting of a sum on
deposit in defendant bank. The assignee made demand for the deposit,
which was refused, and he brought suit. After the demand, but before
suit, a note against the assignors, held by the bank at the date of the
assignment, matured. Held, that it could not be set off in the suit by
the assignee. Chipman v. Ninth Nat. Bank {Pa.), 13 A., 707..
DEPUTY COMPTROLLER:
1. A certificate signed by the Deputy Comptroller of the Currency as '' Acting
Comptroller of the Currency " is a sufficient certificate by the Comptroller of the Currency within the requirements of Rev. St., par. 5154.
Keyser v. Hitz, 133 U. S., 138.
2. The Deputy Comptroller of the Currency being authorized by law to act
for the Comptroller in certain contingencies, the courts will presume, in
the absence of any showing to the contrary, that the Deputy, in acting for
the Comptroller in any particular instance, has acted lawfully. Young
v. Wempe etah, 46 Fed. Rep,, 354.
DIRECTORS: See Officers.
DISTRICT ATTORNEY:
1. For services performed by the district attorney in bringing a suit against
a national bank, and obtaining a forfeiture of its charter, he is not
entitled to more than $10, the fees prescribed by section 824, there being
no other law in the United States giving a compensation to a district
attorney for such services. Bashaw v. United States, 47 Fed. Rep., 40.
2. The 56th (now 153d) section *of the act providing that suits under it, in
which officers of the United States are parties, shall be conducted by the
district attorney of the district, is directory only. Kennedy v. Gibson,
8 Wall,498.
3. District attorney can not recover compensation for services in conducting
suit arising out of the provisions of the national banking law in which
the United States or any of its agents or officers are parties. Gibson v.
Peters, Receiver, 150 U. S.,342.
*
4. The expenses of a receivership can not be held to include compensation of
district attorney for conducting a suit in which the receiver is party,
and he can not receive any compensation for services so rendered or
offered to be rendered. Ib.
DIVIDENDS:
1. Equity has jurisdiction of a suit by the receiver of an insolvent national
bank against all its shareholders to recover dividends unlawfully paid
to them out of the capital at times when the bank had earned no net
profits, and was in fact insolvent, it being in effect a suit to execute a
trust, to undo a fraud, and to prevent a multiplicity of suits. Hayden
v. Thompson et ah, 71 Fed. Rep., 60.
2. A bill by the receiver to recover the dividends illegally paid may be brought
without an express order from the Comptroller of the Currency. Ib.
3. It can not be urged as a defense to such suit that the remedies provided
by the national banking act are exclusive, the right to recover diverted
trust funds not being dependent on statute. Ib.
4. The fact that some of the defendants participated in but one or two of the
sixteen dividends on which the suit was based, that others participated
in more, and others in all the dividends does not render the bill multifarious. Ib.
5. The national courts, sitting in equity, act or refuse to act in analogy to the
statute of limitations of the States in which they are sitting. Ib.
6. A stockholder in an insolvent bank who receives a dividend from funds
properly belonging to the creditors holds it under an implied and not an
express trust in favor of the creditors, and hence limitations run in his
favor against an action to recover the dividend. Ib.
.
7. The rule that the time limited for beginning an action for fraud shall not
commence to run while defendant conceals it does not apply when the
concealment is by a third person. Ib.
REPORT OP THE COMPTROLLER OF THE CURRENCY.
163
DIVIDENDS—Continued.
8. In the absence of fraud the cause of action to recover the dividend wrongfully paid arose when the payment was made, and not upon the appointment of the receiver and the discovery that the other assets of the bank
were insufficient to pay its debts. Ib.
9. A bank has a right to accumulate a surplus before declaring dividends on
its stock. Reynolds v. Bank of Mi. Vernon (Sup.), 39 N.-Y. S., 623.
10. Where complainant has a decree in equity that defendant pay her dividends on stock held by her, and defendant has against complainant an
unsatisfied judgment at law for an assessment on said stock, the court,
on motion, will order the amounts to be paid under the decree applied
on the judgment, though the judgment was at a former term and complainant intends to appeal therefrom. Sowles v. Witters et al., 40 Fed,
Rep., 413.
11. Liquidation dividends of a national bank belong to the holder of the shares,
whether those shares be recorded upon the books of the bank or not, and
must be paid to the holder of such shares on demand. Bath Sav. Inst.
v. Sagadahoc Nat. Bank (Me.), 36 A., 906.
ESTOPPEL:
1. Where one sued by a national bank is accustomed to deal with it as such
and does so deal with it in respect to the matter in suit, he is estopped
from denying its incorporation. National Bank of Fairliaven v. The
Phoenix Warehousing Company, 6 Hun., 71.
2. A director is not, by reason of his position, estopped from setting up the
defense of usury in an action brought against him by the association.
Bank of Cadiz v. Slemons, 34 Ohio St., 142.
3. Where a national banking association has entered into a contract which
it is not authorized to make, a party who has enjoyed the benefit of
such contract can not question its validity. Casey v. La Soeiete de
Credit Mobilier, 2 Woods, 77; German National Bank v. Meadowcroft,
95 III., 124.
4t. Where officer of a bank guaranteed payment in name of bank and sold the
note, the bank by retention and enjoyment of the proceeds is estopped
to deny officer's act. People's Bank v. National Bank, 101 U. S., 181.
5. The organization of a national bank under the national banking act may
be put in issue by a party who has not estopped himself. But a party
who has accepted as payee a promissory note payable at a banking institution which the parties to the note style a national bank, and has sold
and transferred the note to such banking institution; can not be allowed
to raise that issue by merely averring want of knowledge or information
sufficient to form a belief as to whether the institution is a body corporate, etc. Huffaker v. National Bank of Monticello, 12 Bush, 287;
IN. B.C., 504.
6. If, upon inquiry by the surety, the cashier, knowing that he is a surety,
inform him that the note is paid, intending that he should rely upon
his statement, and the surety does so, and in consequence changes his
position by giving up securities, or indorsing other notes for the principal, or the like, the bank will be estopped to deny that such note is
paid. Cocheeho National Bank v. Haskell et al., 51 N. H., 116.
7. A stockholder of a private corporation, when sued by its creditors, is
estopped from denying the legal existence of the corporation, or insisting that its charter has been forfeited by noncompliance with statutory
provisions for which a forfeiture might be j udicially declared. National
Commercial Bank v. McDonnell, 92 Ala., 3S7.
8. Where an officer of a bank loaned money for his individual benefit upon
pretended collateral security of the bank. Held, that his bank was
estopped to deny the loan and is liable therefor, as the lender dealt with
him solely in his official capacity. Stewart v. Armstrong, 56 Fed. Rep.,
167.
'
9. Vice-president of bank, also manager of a commercial house, substituted
as collateral notes to order of his house, and indorsed by them without
consideration. Held, that, as against holders of collateral, the house
was estopped to deny that these notes were properly pledged as security
for a loan to his bank. Ib.
10. The estoppel upon his bank exists only in favor of lender. Hence, his
house has no remedy against it for any liability enforced by the lender
on account of its indorsed notes so pledged. Ib.
164
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ESTOPPEL—Continued.
11. A shareholder who has held himself out to the world as such is estopped
to deny that the association was legally incorporated. Casey v. Galli,
94 U. S., 673; Wheelock v. Kost, 77 III., 296.
12. A person who received dividends on shares of stock standing in his name
on the books of a national bank is estopped from denying his liability on
the ground that he returned the same by check to an officer of the bank.
He is presumed to be the owner of the stock when his name appears
upon the books of the bank, and the burden of proof is upon him to show
that he is not in fact the owner. Finn v. Brown, 142 U. S., 56.
13. A shareholder against whom suit is brought to recover the assessment made
upon him by the Comptroller will not be permitted to deny the existence of the association, or that it was legally incorporated. Casey v.
Galli, 94 U. 8., 673.
14. In such suit stockholder is estopped to deny existence or validity of corporation. Ib.
15. The legality of the appointment of the receiver can not be questioned by
the debtors of the bank when sued by him. The bank may move to have
the appointment set aside, but the debtors can not. Cadle v. Baker,
20 Wall, 650; Platt v. Beebe, 57 N. Y., 339.
16. A corporation which received and used the proceeds of a discount of notes
by its president is estopped to deny his authority to discount the paper.
German National Bank v. Louisville Butchers' Hide and Tallow Co,
{Ky.),£9 S. W.,882.
17. Where the cashier, intrusted by its directors with its entire management,
has been accustomed in having paper rediscounted to guarantee its payment, the bank will be estopped from denying his authority to so guarantee it. First National Bank v. Stone {Mich), 64 N. W., 487.
18. Where the president of a bank procures advancements to be made to a relative by the bank, promising to become liable therefor, and not to receive
payment of any part of the amount which such relative owes him individually until the bank was paid, he is estopped to claim the benefit of a
priority given his debt in a mortgage executed by such relative over that
due the bank, and whatever benefit accrues to him under such mortgage
is subordinate to the claim of the bank. Brown v. Farmers and Merchants' National Bank {Tex. Civ. App.), 31 S. W., 216.
19. A bank which causes property owned by it to be conveyed by a deed regular in form to a worthless corporation, organized by its own directors,
and then loans such corporation money, takes its notes and discounts
them with strangers, by representing them as prime paper and on the
strength of such corporation's apparent ownership of such property, is
thereafter estopped, as against the holders of the notes, to assert that the
conveyance was ultra vires. Butler et al. v. Cockrill, 73 Fed. Rep., 945.
20. The holder of part of the bonds of an insolvent corporation is not estopped
to set up the invalidity or want of consideration of other of the bonds
not in the hands of innocent holders. Farmers & Merchants9 Nat. Bank
v. Waco Electric Raihvay & Light Co. {Tex. Civ. App.), 36 S. W., 131;
Metropolitan Trust Co. v. Farmers & Merchants' Nat. Bank, Ib.
21. In order to constitute a ratification of an unauthorized act, the act relied
on as such ratification must be performed with knowledge of the material facts in the absence of circumstances creating an equitable estoppel.
Columbia Nat. Bank v. Rice {Neb.), 67 N. W., 165.
22. The fact that the bank stamped the original note "Paid," instead of
" Renewed," in the belief that the forged signature of the surety on the
renewal note was genuine, does not estop it from enforcing its claim
against the surety on the original note, though the surety, seeing the
latter in the hands of the principal, believed it had been paid, and signed
other notes of the principal as surety, to his damage. Lyndonville Nat.
%Bank v. Fletcher {Vt), 84 A., 88.
23. After a party has recovered judgment against a corporation, as such, and
obtained the appointment of a receiver therefor, he can not in the same
suit deny its corporate entity and seek to hold the stockholders thereof
liable as partners. First Nat. Bank v. Dovetail Body & Gear Co. {Ind.
Sup.), 42 N.E.,924.
24. A bank which received a letter from another bank asking in regard to the
character and financial standing of a certain person, without any intimation as to the making of a loan, is not estopped, as against a loan subsequently made by the inquiring bans, to claim a chattel mortgage lien
REPORT OF THE COMPTROLLER OF THE CURRENCY.
165
ESTOPPEL—Continued.
25.
26.
27.
28.
29.
30.
81.
32.
33.
on the man's property, because, in its answer, it merely stated the man's
character, and assets above his indebtedness, without stating that he was
indebted to it. First Nat. Bank v. Marshall & Ilsley Bank {Mich.), 65
N. W., 604.
Statements of a mortgagor, made for the purpose of obtaining credit for a
corporation of which he was a member, that he had sold to it the mortgaged property, would not conclude the mortgagee, unless it had knowledge thereof at the time, and kept silent. Ib.
One who has demanded a certain amount as a balance due on a trade is not
estopped from suing for a greater amount, and may explain the demand.
First Nat. Bank v. Lynch {Tex. Civ. App.), 25 8. W., 1042.
A partner who is made known by his fellow-partner to a third person, in
order to obtain credit, can not afterwards claim to be a dormant partner
as to such person, so as to relieve him from the necessity of giving notice
upon retiring from the partnership. Milmo Nat. Bank v. Carter {Tex.
Civ. App.), 20-8. W., 836.
The fact that a party to a contract which is void as against public policy
has received the benefits therefrom does not estop him when sued
thereon from setting up such defense. Brown v. First Nat. Bank {hid.
Sup.), 87 N.E.,158..
The maker of a note payable at Tuscaloosa Fence Factory is estopped in a
suit thereon by an innocent purchaser for value to deny the existence of
such a place. Brown v. First Nat Bank {Ala.), 15 So., 435.
A wife, jointly with another person, signed a note to her husband's order,
and delivered it to him to have discounted, and with the proceeds pay a
debt of his. The husband applied to a bank official, who had notice that
the note was made without consideration, but did not have notice that
the proceeds were to be applied for the husband's benefit, and the official
offered to discount it by a check to the wife's order, which the husband
accepted, and afterwards procured his wife to indorse and deliver to
him, she knowing that it was the proceeds of her note. Held, that the
wife was estopped from setting up against the bank that she was a mere
suretv on the note. Haekettstown Nat. Bank v. Ming. {N. J. Ch.), 27
A., 920.
The organization of a national bank under the national banking act may
be put in issue by a party who has not estopped himself. But a party
who has accepted as payee a promissory note, payable at a banking institution which the parties to the note style a national bank, and has sold
and transferred the note to such banking institution, can not be allowed
to raise that issue by merely averring want of knowledge or information
sufficient to form a belief as to whether the institution is a body corporate,
etc. Huffaker v. National Bank of Monticello, 12 Bush., 287; 1 N. B. C,
304.
H., being indebted to a national bank for a considerable sum, for which
the bank held certain corporate stock as collateral security, in writing
authorized the president and directors of the bank to sell at their discretion all the stock and apply the proceeds of the sale upon his indebtedness. Thereafter, after giving H. ample notice of an intention to sell*
the stock was sold and transferred to three of the directors of the bank,
at a price above the market value, and the amount received from the
sale applied upon the indebtedness of H. H. received an itemized statement of the proceeds of the sale and of its application upon his indebtedness, to all of which he made no objection. Five years thereafter H.
commenced an action against the bank for the purpose of obtaining a
decree redeeming the stock, and for an accounting. Held, that the
action could not be maintained: First, because by his silence he was
estopped; and second, because of delay in bringing suit. Hayward v.
Eliot National Bank, 96 U. S.t 611; 2 N. B. C.t 1.
A national bank purchased the stock of a dealer in wall paper at a sale
under an execution in its favor, and afterwards organized a corporation
to take and dispose of this stock, such corporation being managed by the
officers of the bank, and controlled by it. In order to dispose of the
stock with advantage, new stock was purchased on credit, the bank,
through its cashier, informing the seller, upon inquiry, of the relation
between the bank and the corporation, and that the bank would see that
the bills were paid if the goods were sold. Held, that whether or not it
was within the powers of the bank to purchase new stock to help the
166
REPORT OF THE COMPTROLLER OF THE CURRENCY.
ESTOPPEL—Continued.
sale of that bought on execution sale, the bank having received and
appropriated the proceeds of the goods purchased, was estopped to set
up in a suit for the price a want of power to make the purchase. American Nat. Bank v. National Wall Paper Co., 77 Fed. Rep., 85.
34. A national bank which returns its capital for taxation is not thereby
estopped from setting up that the same was not subject to taxation, and
refusing to pay the tax. Broivn v. French, 80 Fed. Rep., 166.
35. The judgment in an action is conclusive, in a subsequent action between
the same parties upon the same cause, as to all questions which might
have been presented and determined in the first suit; but in a subsequent action between the same parties upon a different cause it is conclusive only upon such questions as were actually litigated and determined in the first suit. Lawrence v. Stearns, 79 Fed. Rep., 878.
36. One who has been prosecuted to judgment upon a cause of action based
on the negligent act of another, who has been called in to defend and has
defended the suit, may sue such other party for indemnity, and rest his
case upon the former adjudication, it being shown that it was in consequence of such negligence that the former judgment passed.
Ib.
EVIDENCE:
1. The certificate of the Comptroller of the Currency that an association has
complied with all the provisions required to be complied with before commencing the business of banking is admissible in evidence upon a plea of
mil tiel corporation; and such certificate, together with proof that the
association has been acting as a national banking association for a long
time, is amply sufficient evidence to establish, at least prima facie, the
existence of the corporation. Mix v. The National Bank of Bloomington,
91IIL, 20; Merchants' National Bank of Bangorv. Glendon, 120 Mass., 97.
2. The certificate of the Comptroller of the Currency duly made is sufficient
evidence of the appointment of the receiver in an action brought by him.
Plait v. Beebe, 57 N. Y., 339; 1 N. B. C., 725.
3. And in a suit against the association or its shareholders such certificate of
the Comptroller is conclusive as to the completeness of the organization.
Casey v. Galli, 94 U. £., 673.
4. Under the national banking act, a copy of the certificate of organization
of a United States national bank, which is certified by the Comptroller
of the Currency and authenticated by his seal of office, is competent evidence in a State court. Tapley v. Martin, 116 Mass,, 275; 1N. B. C., 611.
5. In an action by "The West River National Bank of Jamaica, Vermont.5'
Held, that the certificate of the Comptroller of the Currency of the existence of a corporation under the name of '' The West River National
Bank of Jamaica, "described as located in the town of Jamaica, Vermont,
was admissible under the general issue for the purpose of proving the
plaintiff's corporate existence. Thatcher v. West River National Bank,
19 Mich., 196; 1 N. B. C , 622.
6. It is no objection to the admission in evidence of the certificate of the
organization of a national bank that the notary before whom it was
acknowledged was one of the shareholders of the bank. The Comptroller's certificate of compliance with the act of Congress removes any
objection which might otherwise have been made to the evidence on
on which he acted. Ib.
7. A certificate signed by the Deputy Comptroller of the Currency as " Acting
Comptroller of the Currency" is a sufficient certificate by the Comptroller of the Currency within the requirements of Rev. St., sec. 5154.
Aspinwall v. Butler, 133 U. S., 595.
8. A letter from the Comptroller directing the receiver to institute suit, if
not objected to at the time, is sufficient evidence that the Comptroller
has decided that the enforcement of the individual liability of the shareholders is necessary. Boicden v. Johnson, 107 U. 8.9 251.
9. In an action by a national bank, plaintiff may prove that it is a corporation de facto by parol evidence; that it is carrying on a general banking business as a national bank, authorized by the general laws of the
United States, under the name by which it has sued, the court taking
judicial notice of such laws. Yakima National Bank v. Knipe, 33 P.,
834; 6 Wash., 348.
10. In accordance with the provisions of the Minnesota statute (Gen. St., 1878,
c. 26, § 8; Gen. St., 1894, § 2275) making the certificate of protest of a bill
or note of any notary public of that or another State evidence of the
REPORT OF THE COMPTROLLER OF THE CURRENCY.
167
EVIDENCE—Continued.
11.
12.
13.
14.
15.
16.
IT.
18.
19.
20.
21.
facts therein certified, such a certificate is competent evidence, in a Federal court sitting in Minnesota, of the presentment, demand, dishonor,
or notice of dishonor of a note drawn in Minnesota, and payable and
protested in Connecticut. Nelson v. First Nat. Bank of Killingley, 69
Fed. Rep., 798.
A letter written in the ordinary corirse of business by a clerk in the office
of one sought to be charged as indorser of a note, acknowledging the
receipt of notice of the protest thereof, is competent evidence of the
sending of the notice. Ib.
*
Upon the question of the value of stock in a corporation which has been
placed in the hands of a receiver, under^ a statute of the State creating
it, in proceedings for its dissolution as insolvent, the opinions of competent witnesses as to the value of the stock are admissible, as is also
evidence of the amount and value of the assets and liabilities of t'hfe<
corporation at different times between the appointment of a receiver
and the sale of the assets in accordance with the statutory requirements. Ib.
Upon the same question it is also admissible to prove the amounts realized
at the sales made of the property of the corporation by the receiver,
under the order of the court, in the regular course of the insolvency
proceedings, though taking place at a time remote from that to which
the inquiry as to the value of the stock relates. Ib.
A witness ought not to be permitted to give an opinion as to the value of
an article when it does not appear that he has acquired any correct
information from which to form an opinion, or that he has formed any
opinion whatever. Ib.
When evidence which may have been irrelevant, or otherwise open to an
objection seasonably taken, has been admitted without objection, the
witness being examined and cross-examined by the respective parties,
it is not error to deny a motion to strike out such evidence, made after
its tendency and effect have been disclosed. Farmers & Traders' Nat.
Bank of Covington, Ky., v. Greene et al., 74 Fed. Rep., 439.
When the books of a bank are offered in evidence by one party to a suit,
the other party is entitled to avail himself of any part of the evidence
contained therein, such as the state of a particular account. Blanchard
v. Commercial Bank of Tacoma, 75 Fed. Rep., 249.
In an action to recover a sum alleged to have been loaned to a bank, the
receiver thereof claimed that the loan was to the president of the bank
personally. He also contended that the bank's books should not be considered as evidence that the loan was to the bank, because they were not
properly kept, and he offered to show by expert testimony what would
have been the proper method of entering the transaction if the loan had
been made to the bank. Held, that this evidence was properly excluded,
as it did not appear that there was any such ambiguity in the account
as to require expert evidence in relation thereto. Ib.
Where a jury is waived, and the court makes special and general findings,
an appellate court is not required to weigh the evidence and determine
the preponderance thereof, but will only consider whether the pleadings
and special findings are adequate to support the judgment. Walker v.
Miller, 8 C. C. A., 331; 59 Fed. Rep., 870, followed.
On an issue as to whether the deposits of plaintiffs' testator in defendant
bank were interest bearing, evidence of the value of the use of money
in vicinity of the bank, and that testator received interest on similar
deposits in other banks, and that one bank offered him 5 per cent on any
money that he might deposit, is admissible in rebuttal of defendant's
evidence that the agreement between the parties, by which testator's
account should be interest bearing, was abrogated by a subsequent
agreement that it should not bear interest. Merwin, J., dissenting.
McLoghlin v. National Mohawk Valley Bank (Sup.), 20 N. Y. S., 171.
An instruction that a party alleging fraud must prove it by a preponderance of the evidence, so clear that it leaves the mind well satisfied that
the charge is true, requires too high a degree of proof, since it is sufficient if the jury believe a material fact in issue, from the evidence, even
if the proofs do not generate a belief which entirely satisfied the mind.
Hutchinson Nat. Bank v. Crow, 56 III. App., 55S:
The certificate of organization of a national bank, issued by the Comptroller of the Currency, is competent evidence of the incorporation of the
bank. National Bank of Commerce v. Galland (Wash.), 45 P., 35.
168
REPORT OF THE COMPTROLLER OP THE CURRENCY.
EVIDENCE—Continued.
22. Where the cashier of a bank, who assumed to be acting as such, applied
to another bank in the usual course of business to discount a note produced by him, payable to himself, and regularly indorsed by him in
both his individual and official capacity, neither the fact that he appeared
to be the payee and first indorser and his bank the second indorser, nor
that the avails of the note were received by him personally, was conclusive evidence that the indorsement of his bank was unauthorized or
for his own accommodation. Merchants' Nat. Bank v. McNeir (Minn.),
63 N. W.,178.
23. In an action by a bona fide holder on bonds of a school district, purporting
to have been issued in satisfaction of a judgment against the district,
as authorized by acts 17th Gen. Assem., c. 132, the defense was that
such bonds had been fraudulently issued after the judgment had been
already satisfied by a prior issue of bonds. Held, that, after a showing
that a diligent search had been inffectually made for the records of the
district authorizing the first issue of bonds, and after the then secretary
of the district identified one of such bonds as having been issued in payment of the judgment*in question, and had partly described the others,
such bonds purporting on their face to have been issued by the officers
of the district, and having been afterwards found to be valid obligations
of the district by a court of competent jurisdiction, were themselves
properly admitted in evidence. First Nat. Bank v. District Tp. of Boon
(Iowa), 53 N. W.,301.
24. Depositing in the post-office a letter properly addressed, with postage prepaid, is prima facie evidence that the sendee received it. Ripley Nat.
Bank v. Latimer, 2 Mo. App. Rep'r, 967.
25. In an action to recover the amount paid to the payee and indorser of a
check, on the ground that the amount of the check had been raised,
where experts had testified that writing could be removed by acids withleaving any trace, and there was evidence that the name of the payee
and amount in the check in question had been altered, but none that the
check had been subjected to acids, experienced cashiers were properly
allowed to testify as to the genuineness of the check, though not shown
to be experts as to the effect of acids on writing. Birmingham Nat.
Bank v. Bradley (Ala.), 19 So., 791.
26. On an issue whether a check had been raised in amount, it was error to
admit in evidence a check which bore evident signs of having been
altered, as a result of experiments with acids which had been made
thereon, for the purpose of showing that an alteration could not be made
without detection. Ib.
27. The testimony on another trial of an officer of a corporation with relation
to previous corporate acts can not be proved as an admission binding
upon the corporation. Columbia Nat. Bankv. Rice (Neb.), 67 N. W.,
165.
28. Proof of false statements knowingly made by the purchaser of goods,
whereby he is shown to be possessed of a large amount of property over
and above his liabilities, is admissible under an allegation that, being
insolvent, he knowingly concealed his insolvency from the vendor. First
Nat. Bank v. McKinney (Neb.), 66 N W., 280.
29. In an action on a note dated on Sunday, the burden is on plaintiff to show
that it was in fact executed on a day which was not Sunday. Hauerwas
v. Goodloe (Ala.), 13 So., 567.
30. In an action by a bank on a note dated on Sunday, its " discount register "
is not admissible in evidence to show that the note in suit was a renewal
of a note which matured on Sunday, and that the renewal note was
made on a certain week day after its date and dated back to the date of
the maturity of the first note, according to the custom of the bank. Ib.
31. In an action by a bank on a note dated on Sunday, it is not error to admit
evidence that the note is in the handwriting of the bank's cashier, and
that he was not in the employ of the bank until after the date of the
note, and that the note is a renewal note, and dates back. Ib.
32. Where defendant, in a suit by a mortgagee against the mortgagor for the
mortgaged property, claims payment of the debt the burden is on him
of proving such payment. First Nat. Bank v. Hellyer (Kan.), 37 P.,
130.
33. The testimony of a witness in another case may be proven by anyone who
heard it, and the reporter's notes are not the only or best evidence.
German Nat. Bank v. Leonard (Neb.), 59 N. W., 107.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
169
EVIDENCE—Continued.
34. The testimony of a witness in an action to which he was not a party may
be proved in a subsequent action to which he is a party as an admission. Tb.
35. Parol evidence is admissible to show that the word " accounts," as used in
an assignment, for the purpose of security, of the "good and collectible
accounts" of the assignor, covered not only such accounts as showed an
unconditional liability on the part of the debtor at the date of the
assignment, but also partially executed contracts and consignment contracts which called for payment in the future and on conditions to be
performed. Preston Nat. Bank v. Emerson (Mich.), 60 N. W., 981.
36. As against bona fide purchasers of a note signed in blank on the back
thereof by a third person before delivery to the payee, parol evidence is
not admissible to show that such person signed as accommodation
indorser, and not as joint maker, as presumed by law. Salisbury v.
First Nat. Bank (Neb.), 56 N. W., 727.
37. In an action by one bank against another on a note, and for money loaned,
where defendant asserts that plaintiff bought the note, proof of the negotiations for the loan, and that defendant received its proceeds, is not
incompetent as varying the written instrument. First Nat. Bank v.
California Nat. Bank (Cal.), 35 P., 639.
38. Where the genuineness of the signatures of certain letters alleged to have
been written by plaintiff were in question, and she admitted her signature to a certificate of stock, it was not error to send the stock book to
the jury for a comparison of signatures. Rose v. Winnsboro Nat. Bank
(S. C.), 19 8. E., 487.
39. Where a written instrument belongs exclusively to a party and, according to the course of business, ought to be in his possession, parol evidence of its contents may be given after he has disregarded a notice to
produce it.
40. An unsigned entry on a deed is inadmissible to show the time it was filed
for record. First Nat. Bank v. Cody (Ga.), 19 S. E., 831.
41. Parol evidence is admissible to show that a note, though in the possession
of the payee, was delivered with the understanding that it would not be
binding upon the makers unless signed by other persons. Merchants'
Nat. Bank v. McAnulty (Tex. Civ. App.),31 S. W., 1091.
42. In an action for malicious prosecution of an attachment, it is not error to
refuse to permit plaintiff to testify whether defendant had any motive
in procuring the issuance of the attachment other than an honest desire
to collect a debt and to limit him to a statement of the facts. Hamer
v. First Nat. Bank (Utah) ,33 P., 941.
43. In an action by a national bank against a maker of a promissory note, the
fact that the note is made payable at the plaintiff bank is not conclusive
evidence that such bank is a corporation. Hungerford National Bank
v. Van Nostrand, 106 Mass., 559; 1 N B. C, 589.
44. Under the acts of Congress authorizing questions arising on a trial or
hearing before two judges in the circuit court, and upon which they are
divided in opinion, to be certified to the Supreme Court of the United
States for decision, each question certified must be one of law and not
of fact, nor of mixed law and fact, and it must be a distinct point or
proposition clearly stated, and not the whole case, nor the question
whether upon the evidence the judgment should be for one party or for
the other. Williamsport Nat. Bank v. Knapp, 119 U. S., 357; 3 N. B. C,
184.
n
45. 4- indorser on certain notes made a compromise with the indorsee by
which he gave his notes for a part of the amount due, he to be released
from liability on the original notes upon payment of the compromise
notes at maturity. Held, that evidence that money with which he
made part payment on the compromise notes was borrowed by him was
not admissible on an issue as to whether the indorsee, after accepting
such payments, was estopped to hold him liable on the original notes.
Humphreys v. Third Nat. Bank of Cincinnati, 75 Fed. Rep., 852.
46. An indorsee of a note agreed to receive, in compromise of an indorser's
liability thereon, secured notes for a less amount, the indorsee to have
the right, if the compromise notes were not paid when due, to sue the
indorser for the balance remaining due on the original notes, after applying thereon the partial payments made on the compromise notes, and
the proceeds of the security given therefor. Held, that the indorsee did
170
REPORT OF THE COMPTROLLER OF THE CURRENCY.
EVIDENCE—Continued.
not, by receiving part payments on the compromise notes after their
maturity, waive the right to sue the indorser on the original note. 66
Fed. Rep., 87;?, affirmed. Ib.
47. Nor did he waive his right to proceed on the original note by failing to
tender back the compromise notes, or the security given therefor. Ih.
48. Where the facts do not appear on the face of the judgment, oral evidence
is admissible to show how credits thereon came to be allowed and what
they were allowed for. Ib.
EXECUTION:
1. A judgment against a national bank in the hands of a receiver only establishes the validity of the claim; the plaintiff can have no execution on
such judgment, but must wait pro rata distribution. Bank of Bethel v.
Pahquioque Bank, 14 Wall, 3S3.
2. A sheriff in Texas has no power to levy upon or sell land lying outside his
county, and his deed, describing by metes and bounds land purporting
to have been levied on and sold, part of which lies outside his county, is
void as to such part. Short v. Hepburn, 75 Fed. Rep., 113.
3. The imperfect description of property in a notice of sheriff's sale under
execution will not necessarily vitiate the sale where the description is
sufficiently certain so that no one is deceived as to the identity of the
property sold. Grundy County Nat. Bank v. Rulison, 61 Ill.App.,3SS.
4. Where judgment has been rendered in a State court against a national
bank, and upon the execution issuing thereon a return of nulla bona
has been made by the sheriff of the county where the bank is located,
and the bank has ceased to discharge its functions as a fiscal agent of
the United States, and is disposing of its assets which can not be reached
by levy and sale under the common-law execution among its stockholders, thereby endangering the safety of those assets and the judgment
debt of the creditor, equity will relieve by the grant of injunction and the
appointment of a receiver. Merchants and Planters' National Bank v.
Trustees of Masonic Hall, 2 N. B.C., 220.
5. A bill by a judgment creditor for discovery showing that when the execution was returned unsatisfied and when the bill was filed there was
property, within the knowledge of the creditor, subject to levy on execution, fails to show that the legal remedy has been exhausted and is
demurrable. Merchants' Nat. Bank of Chicago et al. v. Sabin et al., 34
Fed. Rep., 402.
EXPIRATION OF CORPORATE EXISTENCE:
Under the act of Congress, July 12, 1882, extending for the piirpose of liquidation the franchises of such national banking associations as do not
extend the periods of their charters, and making applicable to them the
statute relating to liquidation of banking associations, such an association may continue to elect officers and directors for the purpose of effecting liquidation. But after the expiration of the term of its charter the
stock of such an association is not transferable so as to give the transferee the right to share in the election of directors, and such transferee,
not being a stockholder, is ineligible as a director under Rev. St., sec.
5145. Richards v. Attleboro National Bank, 14s Mass., 187; 3 N. B. C,
495.
EXTENSION OF CORPORATE EXISTENCE:
1. The identity of a national bank is not affected by the extension of its term
of existence. Trustees of First Presbyterian Church v. National State
Bank, 29 A., 320.
2. The committee provided for by the fifth section of act of Congress of July
12, 1882, to appraise the national-bank shares of shareholders who do not
assent to amendments to the articles of association, may correct a mistake made by them in their approval within thirty days therefrom.
First National Bank of Clarion v. Brenneman's Executors, 114 Perm. St.,
315; 3 N. B. C, 755.
FALSE ENTRIES:
1. The only remedy for the making of a false return to the auditor, by the
cashier of a bank, of the resources and liabilities of the bank, for the purposes of taxation, is afforded by revised statutes of Ohio, section 2679,
which provides that the auditor may examine the books of the bank, and
REPORT OF THE COMPTROLLER OF THE CURRENCY.
171
FALSE ENTRIES—Continued.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
any officer or agent of it under oath, and make out the statement; and
any officer of the bank may be fined not exceeding $100 for failing to
make the statement, or for willfully making a false one. Miller v. First
National Bank, 21 N. E.9 860.
Any entry on the books of the bank which is intentionally made to represent what is not true or what does not exist, with intent either to deceive
its officers or defraud the association, is a false entry within the meaning
of the statute. United States v. Harper, 33 Fed. Rep., 471.
It may be made personally or by direction. Ib.
The erasure of figures already written in the books of a national bank and
the substitution of other figures which falsify the state of the account
constitute a "false entry " within the meaning of sec. 5209, Rev. St., by
which it is declared to be a misdemeanor to make any' ; false entry in any
book, report, or statement of the association, with intent to injure or
defraud," etc. United States v. Crecelhis, 34, Fed. Rep., 30.
Where false entries are made by a clerk at the direction of the president,
the latter is a principal. In the matter of Van Campen, 2 Ben., 419;
United States y. 'Fish, 24 Fed. Rep., 585.
A report of condition of a national bank, whether called for by the Comptroller of the Currency or not, which is a report in the usual form made
by an officer of the bank in his official capacity, if it contains a false entry
made with intent to deceive, is within Rev. St... sec. 5209, which declares
such false entries to be a misdemeanor. United States v. Hughitt, 45
Fed. Rep., 47.
Where false entries were made by a bookkeeper in a statement requested
by a national-bank examiner purporting to give the balance due to depositors, which statement it was the duty of the examiner to make and not
the bookkeeper, an indictment for making '' false entries in a statement
of the association " will not be sustained. United States v. Ege, 40 Fed,
Rep., 852.
In an indictment of an officer of a national bank under sec. 5209, Rev. St.,
for making false entries in a report to the Comptroller of the Currency,
it is no defense that such entries were made by a clerk and verified by
the officer without actual knowledge of their truth, since it was his duty
to inform himself. United States v. Allen, 47 Fed. Rep., 606.
A * ' false entry " in a report by a national-bank officer or a director to Comptroller of the Currency within the meaning of sec. 5209 is not merely an
incorrect entry made through inadvertent negligence or mistake, but is
an entry known to the maker to be untrue and incorrect and by him
intentionally entered while so knowing its false and untrue character.
United States v. Graves, 53 Fed. Rep., 634.
In determining whether a certain false entry, made by a national-bank
officer in a reporfcto the Comptroller, was made with intent to deceive
or defraud, etc., within the meaning of the statute, the jury are authorized to infer the intent if the natural and legitimate result of such false
entry would be to deceive any other officer or officers of the bank or any
agent appointed to examine into its affairs. 'Ib.
In determining whether defendant made a " false entry" within the meaning of the statute when he included in such reports as ' * Loans and discounts " of the bank amounts which were being carried on the books of
the bank as "overdrafts," the jury will not consider whether other
national banks followed the same practice; but the jury, in determining
whether such entry, if a "false entry,"was made with intent to deceive
and defraud, may consider whatever knowledge defendant is shown to
have had as to practice of any other national bank in this respect. Ib.
It is not necessary to complete the offense of making a "false entry " in a
report to the Comptroller of the Currency of the condition of a national
bank, with intent to deceive or defraud, that any person shall have been
in fact actually deceived or defrauded, for the making of such a * * false
entry " with the intent to deceive or defraud is sufficient. Ib.
Under sec. 5209 of the national-bank act it is an Indictable offense to make
a false entry in a report to the Comptroller of the Currency, or to aid
and abet the making of such an entry. United States v. French et al., 57
Fed. Rep., 382.
14.. It is not a "false entry " to enter under heading of •'• Loans and discounts"
items which, on books of the bank and for convenience of its officers,
have been temporarily withdrawn from that heading, and which are,
172
REPORT OF THE COMPTROLLER OF THE CURRENCY.
FALSE ENTRIES—Continued.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
from day to day, carried on the books of the bank under heading of " Suspended loans " while awaiting action of directors as to same being withdrawn from character of loans and entered up as a loss on profit and
loss account. United States v. Graves, 53 Fed. Rep., 634.
The president and assistant cashier of a national bank are indictable as
principals, under Rev. St., sec. 5209, for making a false entry in a report,
although neither of them actually signed or attested the report. Coehran
v. United States, 15 S. Ct., 628.
The assistant cashier of a bank is indictable under Rev. St., sec. 5209, for
making a false entry in a report to the Comptroller, although he is not
one of the officers authorized by section 5211 to make such a report; for
he may be regarded as within the category of " clerk or agent," within
the terms of section 5209. Ib.
An indictment under Rev. St., sec. 5209, for making a false entry in a
report to the Comptroller need not allege that such report was made by
the banking association, or that it was actually verified by the oath or
affirmation of the president or cashier, or attested by the directors, as
required by section 5211; but it is sufficient to aver that defendant made
such false entry "in a certain report of the condition of the First
National Bank, * * * made to the Comptroller of the Currency in
accordance with the provisions" of Rev. St., sec. 5211. Ib,
The jury are warranted in finding that false entries were made with guilty
intent from the testimony of defendant that the said entries were made
under his direction, with the knowledge that they were not transactions of the day on which they were entered in the books of the bank.
United States v. Folsom, 38 P., 70.
The "false entry" in the books or reports of a bank, which is punishable
under Rev. St., sec. 5209, is an entry that is knowingly and intentionally
false when made. It is not the purpose of the statute to punish an
officer who, through honest mistake, makes an entry in the books or
reports of the bank which he believes to be true, when it is in fact false.
United States v. Allis, 73 Fed. Rep., 165.
If a president or cashier makes a false entry in a report of the condition
of the bank to the Comptroller of the Currency, the jury are authorized
to iDresume, from the false entry itself, in the absence of any explanation or of any other testimony, that he knew it to be false. This presumption results from the fact that it is the duty of the officer who verifies the report to know the condition of the bank, and if the report is
false there is a prima facie presumption that he knew it. Ib.
A false entry, either in the books of the bank or in a report of its condition,
is punishable only when the jury find that it was made by the defendant,
or by his direction, with the intent either (1) to injure or defraud the
bank, or some other corporation, or some firmor person; or (2) to deceive
some officer of the bank; or (3) to deceive some agent appointed or thereafter to be appointed to examine the affairs of the bank. If any one of
these intents is present the offense is complete. Ib.
Where an entry in the books or in a report of the bank's condition is in fact
false, the jury are authorized to infer, from the false entry itself, an intent
of the defendant to injure or defraud the bank, or some other corporation or individual, or to deceive some officer of the association, or an
agent appointed to examine into the condition of the bank, if such would
be the natural and probable consequence of the false entry. Ib.
A false entry made in the books or reports of a bank by a clerk, bookkeeper, or other subordinate employee, by the command or direction of
the president of the bank, is a false entry made by the president, and
he is liable to punishment for it if he gives the direction knowing the
entry to be false, or with the intent to defraud, deceive, etc. Ib.
If a false entry in the books or reports is made with a criminal intent, it is
no defense that another false entry is also made, which offsets the former
entry, with a like intent; but changes of this character are not as strong
evidence of an intent to injure or defraud the bank, or to deceive its
officers or examiners, as false entries which enable the officer making
them to withdraw the funds of the bank without consideration. Ib.
Every overdraft, whether made by previous arrangement or not, whether
secured or not, and whether drawing interest or not, is a loan, and is
required by the law and the rules prescribed by the Comptroller to be
listed and reported as an overdraft. It is, therefore, no defense to a
REPORT OF THE COMPTROLLER OF THE CURRENCY. 173
FAI*SE ENTRIES—Continued.
charge of false entries in respect to overdrafts that they had been
arranged for or secured, or that interest was to be paid upon them by
agreement, if such false entries were made with a criminal intent; but
in determining the intent the jury may consider the testimony of defendant that he considered the overdrafts as loans. Ib.
26. If the president of a bank makes or causes to be made false entries in its
books, or in reports to the Comptroller, with the intent to deceive or
defraud, etc., it is no defense that he struggled to save the bank from
failure and to provide money to pay its depositors by sacrificing his own
property and borrowing money from others. Ib.
FORFEITURE OF CHARTER:
1. Forfeiture of the privileges and powers of a national bank must be determined by a suit brought by the Comptroller of the Currency and until
determined it may do business, and no person, by a conspiracy to evade
its regulations, may escape liability for borrowed money loaned by it
upon personal security in the manner authorized. Stephens v. Mortongahela National Bank, 88 Penn. St., 157; 32 Am. Rep., 438; 2 N. B. C., 398.
2. Under Rev. St., sec. 5239, providing that if the directors of a national bank
shall violate any of the provisions of the title relating to the organization and management of banks, the franchises of the bank shall be forfeited, such violation, however, to be determined by a proper court of
the United States in a suit therefor by the Comptroller, and that in case
of such violation every director participating therein shall be personally
liable for all damages which the bank, its shareholders, or any other
person shall have sustained in consequence thereof, the Comptroller can
not authorize the receiver to bring suit, under sec. 5234, to enforce such
personal liability, until it has been adjudged by a proper court that such
acts have been done as authorize a forfeiture of the charter. Welles v.
Graves, 41 Fed. Rep., 459.
3. The forfeiture of the rights, privileges, and franchises of a bank authorized
by Rev. St., sec. 5239, for violation by its directors of the provisions of
the banking act, comes within sec. 1047, limiting suits for any penalty
or forfeiture accruing under the laws of the United States to five
years. Ib.
4. The right to maintain an action under Rev. St., sec. 5239, to recover from
a bank director the damages sustained by his bank in consequence of
excessive loans made by him while serving in the capacity of director,
is not affected by the fact that the Comptroller has or has^not procured
a forfeiture of the bank's charter. Stephens v. Overstolz, 43 Fed.
Rep., 771.
5. In an information charging that '* the banking association and the directors
thereof did knowingly permit," etc., the allegation that the association,
aside from the directors, permitted the doing of the alleged acts, tenders
an immaterial issue, and should be stricken out on motion. Trenholm,
Comptroller v. Commercial National Bank, 38 Fed. Rep., 323.
6. As the section only refers to acts done by the directors, or by the executive
officers with the knowledge of the directors, an information seeking a
forfeiture, which charges that the association did the act, is insufficient. Ib.
7. It seems that to maintain a suit by the receiver of a national bank to enforce
the liability of its directors, arising under the provisions of Rev. St.,
§ 5239, it must appear that a forfeiture of the charter of the bank had
been adjudged by a court of the United States at the suit of the Comptroller of the Currency, as provided in that section. Welles v. Graves,
41 Fed. Rep., 459, reaffirmed. HaydenY. Thompson, 17 C. C. A., 592; 71
Fed. Rep., 60, distinguished. Stephens v. Overstolz, 43 Fed. Rep., 7719
disapproved. Gerner v. Thomson et at., 74Fed. Rep., 125.
FORGERIES :
1. A depositor owes a duty to the bank to make an examination of his pass
book and vouchers within a reasonable time; and if loss would result
to the bank from his failure to do so he can not recover for forged checks
paid by the bank and charged to his account. First National Bank v.
Allen, 14 So., 335.
2. Where the examination is committed to a clerk or agent who has himself
committed the forgeries, his concealment of such forgeries will not relieve
174
REPORT OF THE COMPTROLLER OF THE CURRENCY.
FORGERIES—Continued.
3.
4.
5.
6.
7.
8.
9.
the depositor from the consequences of the failure to discover the fraud
and notify the bank. Ib.
But if the omission of the depositor to discharge such duty has resulted in
no injury to the bank, the depositor may recover. Ib.
Where, however, forgeries by the same person are committed, after the
depositor is chargeable with knowledge of the fact, the failure of the
depositor to give the bank notice may estop him to dispute the genuineness of such checks. Ib.
Plaintiff bank paid defendant bank money on a forged order, made payable
at plaintiff bank, bearing the general indorsement of the payee and of
defendant, the latter being "For collection." The person by whom the
order purported to be drawn was a customer of plaintiff, and had directed
it to pay orders drawn by him. The forgery was not discovered for four
weeks. Held, that an answer alleging that at the time of the payment
the payee had property from which the order could have been collected,
but that before the discovery of the forgery the payee had departed with
his property, was not sufficient; to prevent recovery of the money paid
defendant, as it did not show how long the payee and the property
remained within reach, and therefore failed to show loss to defendant by
unreasonable delay of plaintiff in discovering the forgery and notifying
defendant. Indiana National Bank v. First National Bank, 36 N. E., 382.
In an action against a bank by a depositor to recover the amount of checks
drawn bv plaintiff, but alleged to have been paid by defendant on indorsements of the payees' names forged by plaintiff's cashier, part of whose
duty was to fill in the body of checks for plaintiff to sign, pay bills, and
keep the accounts, it appeared that the money on the checks in question
had been obtained by plaintiff's cashier, but there was no evidence that
any payees had been named in them, the canceled checks having been
destroyed by the cashier. Held, that plaintiff could not recover, as it
would not be presumed that the cashier committed forgery in addition
to the embezzlement, when he could have avoided forgery by making
the checks payable to "cash" or "bearer," in which event defendant
would not be liable. National Board of Marine Underwriters v.
National Bank of the Republic, 29 N. Y. S., 698.
Defendant bank received a check drawn on plaintiff for collection. After
plaintiff had remitted to defendant and defendant had paid the holder
of the check, it was discovered that the payee's name was forged. Held,
that delay of plaintiff in notifying defendant of the forgery did not
relieve defendant from liability,where the only evidence of injury from
the delay was that of defendant's cashier, who said: "If more seasonable notice had been given the forger would have been arrested earlier,
and more favorable results might have arisen." Third National Bank
v. Merchants' National Bank, 27 N. Y. S., 1070.
In an action by a bank which has paid to another bank a check drawn on
the former bank and transferred to the latter by a forged indorsement,
it is immaterial whether the signature of the drawer of the check is
genuine, since both parties are estopped to deny its genuineness. First
National Bank v. Northicestern National Bank (III.), 38 N. E., 739.
The defendant, as collecting agent of the Bellaire Bank of Ohio, collected
at the subtreasury, New York, a pension draft on which the payee's
name was forged after her death. The defendant in making the collection indorsed the draft as collecting agent of the Bellaire Bank, as
appeared by the terms of its indorsement, and on collection at once
paid over the money to the principal, without notice of the forgery,
before this action was commenced. Held, that the defendant was not
liable. The case of Onondaga Co. Sav. Bank, 12 C. C. A., 407; 64 Fed.
Rep., 703, distinguished. United States v. American Exchange Nat.
Bank, 70 Fed. Rep., 232.
10. Defendants, who were note brokers at Omaha, and who had done business
as such with the plaintiff bank in Iowa, sent to plaintiff by mail a list
of commercial paper offered for sale, including a note described as made
by seven persons jointly to the order of one B., and indorsed by B. and
another. The list sent plaintiff was headed by defendants' business card
as brokers, and it contained sundry items of information about the parties to the note, purporting to be the result of inquiries as to their solvency and standing, and indicating that the same were good. Plaintiff
purchased the note, and, by defendants' directions, remitted the sum
REPORT OF THE COMPTROLLER OF THE CURRENCY,
175
FORGERIES—Continued.
paid therefor to a bank in Chicago. Defendants received from such
sum only their commission for selling the note, the balance being paid
to B., for whom they sold it. It afterwards proved that all the signatures on the notes except that of B. were forgeries, and that B., although
at the time of the sale of the note reported to be solvent, was in fact
insolvent and wholly worthless. Plaintiff sued defendants to recover
the amount paid for the note on an alleged warranty of genuineness.
Held, that there was nothing in the note or in the circumstances of the
transaction between plaintiff and defendants to justify an assumption
that defendants had any interest in or ownership of the note, but. on
the contrary, that the plaintiff bank must have known that it was taking title as tho indorsee of B., and that defendants were acting as brokers only, and, accordingly, that defendants, having acted only as agents
of a disclosed principal, could not be held personally liable for the note.
Monticello Bank v. Bostwick et ah, 71 Fed. Rep., 641.
11. The forgery of the maker's name to a renewal note delivered by the payea
to the holder of the original note does not discharge the maker from
liability on such original note, as the giving of a forged note in lieu of
it does not operate as payment. Second Nat. Bank v. Wentzel (Pa,
Sup.) U A., 1087.
12. In an action on a note by a bank against the indorser, who alleges his signature to be a forgery, evidence by the cashier and teller of the bank
that the indorser had admitted the genuineness of his signature on
another note, not in evidence, and that such other signature was precisely the same as the signature to the note in suit, is not competent for
the purpose of estopping the indorser from denying such signature. Ib.
13. Testimony by the teller of the bank that the indorser had admitted his
signature to a note for which the one in suit was given as a renewal is
properly stricken out as irrelevant, where the teller subsequently
acknowledges that the indorser's admission related to another note, not
connected with the one in suit. Ib.
14. Evidence by defendant, on cross-examination, denying that he had received
the proceeds of other notes, not in suit, which had been indorsed by
him, and which had been negotiated by the maker, who also negotiated
the one in suit, can not be contradicted by plaintiff in rebuttal, since
such cross-examination related to an irrelevant matter. Ib.
15. In an action against an indorser on a renewal note, who was released from
liability on the original note because it was not protested for nonpayment, it is error to charge that there may be a recovery if the indorsement on the first note was genuine, notwithstanding the indorsement
on the renewal note was a forgery; but the jury haying found for the
indorser, plaintiff can not complain of such instruction. Ib.
16. An admission by the indorser of a note as to the genuineness of his signature, made to the holder after it had discounted the same, does not
estop him from denying the genuineness of the alleged indorsement on
a renewal note given by the maker, the indorser having been released
from liability on the original note by reason of its nonprotest for nonpayment. Ib.
17. A bank, which holds a note made by two persons as principal and surety,
in accepting, in good faith, at maturity, a renewal note to which the
name of the surety was forged by the principal, is not bound to know
the handwriting of the surety, and is, hence, not guilty of negligence,
entitling the surety to a discharge from liability on the original note, in
failing to compare the surety's signatures on the two notes, respectively,
with reference to ascertaining the genuineness of that on the renewal
note. Lyndonville Nat Bank v. Fletcher (Vt.), 34, A., 38.
18. The right of the United States Government to recover money paid on a
check on the Treasury, under a forged indorsement, is conditioned on
promptness in giving notice to the person to whom the check was paid.
United States v. Clinton Nat. Bank, 28 Fed. Rep., 357.
19. A bank clerk, whose duty it was to prepare exchange for the cashier's signature, so drew a draft for $25 to his own order that the amount could
be readily altered, and, after procuring the cashier's signature by pretending that he wished to make a remittance of that amount, altered the
draft so that it presented the appearance of a genuine draft for $2,500,
and thereafter indorsed it, and procured it to be discounted. Held, that
the forgery by the clerk, and not the negligence of the bank, was the
176
REPORT OF THE COMPTROLLER OF THE CURRENCY.
FORGERIES—Continued.
proximate cause of the loss, and the bank was not liable therefore
Exchange Nat, Bank of Spokane v. Bank of Little Rock, 58 Fed. Rep., ljfi*
20. The bank was not liable on the ground that the forger was its confidential
employee, because in this transaction he acted as a purchaser and not as
an employee, and because the purchase of the draft was complete, and
he was the owner of it when the forgery was committed. Ib,
GUARANTY:
1. A personal guaranty, given by stockholders and directors to another bank
in consideration of loans, discounts, or other advances to be made, for
the repayment of any indebtedness thus created, imposes a liability on
the guarantors when acted on by the guarantee, though no notice of the
acceptance of the guarantee was given, for the contract shows a personal
interest of the guarantors in the advances constituting a consideration
moving to them. Doud et al. v. National Park Bank, 54 Fed. Rep., 846,
2. Receivers were appointed for an insolvent investment company, incorporated under the laws of Missouri, whose liabilities consisted mainly of
guaranties, in various forms, indorsed on bonds, secured by real estate
mortgages, executed by borrowers to the company, and subsequently
sold and transferred by it to investors with the guaranties mentioned.
Held, that the rights of stich investors were governed by the State statute relating to assignments, for benefit of creditors, which provides that
the assignment shall be " for all the creditors of the assignor in proportion of their respective claims" (Rev. St. Mo. 1889, § 424); that, in the
distribution of the property of such company, all claims should be allowed
which, at the time of the appointment of the receivers, (1) furnished a
present cause of action against the guarantor, or (2) constituted direct
obligations on its part, whether due or to become due, or (3) which,
though not then matured, or not constituting direct obligations, thereafter matured or would mature, or become direct obligations, before
any order of distribution was made; and that all claims should be
rejected (1) which arose on guaranties of collection, as distinguished
from guaranties of payment, where no proceedings had been taken by
the holder to collect from the maker or from the mortgaged premises, or
(2) which were not matured, and in respect to which there had been no
default of interest, or (3) in which by agreement between the holder
and maker, without the assent of the guarantor, the time of payment of
the principal obligation had been extended. New York Security &
Trust Co. et al. v. Lombard Inv. Co. of Kansas et ah, 73 Fed, Rep., 537,
3. A claim against a guarantor of payment matures, so as to become a direct
obligation, not only on the date the guaranteed debt becomes due, but
on default in payment of interest or other preliminary obligation, when,
by the terms of the contract, such default is made to precipitate maturity of the debt. Ib.
4. Receivers were appointed for an insolvent investment company, which
had sold and transferred obligations secured by mortgage, with guaranties of payment thereof, but with a provision that, in case of default,
it should have two years within which to collect and pay over the
amount of the debt. Held, that claims arising on these guaranties were
provable against the receivers where default had occurred and the two
years had expired, whether these two events had occurred both before
the appointment of the receivers, or one before and one after such
appointment, or both after the appointment; and, further, that such
claims were provable after default, although the two years should not
expire before the order of distribution. Ib,
5. A guaranty of collection of an obligation secured by mortgage which is
transferred by the guarantor is an undertaking to pay the debt on condition that the person to whom the guaranty is given shall diligently
proceed against the principal debtor and the mortgage security, and, in
default of such diligence, the guarantor is released. Ib.
6. An investment company selling and transferring an obligation secured by
mortgage agreed, by indorsement thereon, " first, to guarantee the payment of the coupons attached hereto at the maturity thereof; second, to
collect at its own expense, and to pay over the principal hereof at maturity, provided the same is paid by the maker; third, in event of default
being made by the maker to collect at its own expense and to pay over
the principal hereof within two years from maturity of the same," with
interest at 6 per cent per annum. Held, that this was a guaranty, not
of collection merely, but of payment. Ib,
REPORT OF THE COMPTROLLER OF THE CURRENCY.
177
GUARANTY—Continued.
7. Payment of interest in advance on a note is not of itself evidence of an
agreement for the extension of time of payment sufficient to release a
surety from liability. American Nat. Bank v. Love, 62 Mo. App., 378.
8. Where one of several sureties, after all have signed, but before the debt
has been paid, obtained a mortgage from the principal as indemnity, it
inures to the benefit of his co-sureties. Farmers & Traders' Nat. Bank
v. Snodgrass (Or.), 45 P., 758.
9. Where one purchased negotiable paper from the president of a bank with
a guaranty of payment executed" by him apparently in behalf of the
bank, on his representation that the paper belonged to the bank, and
the transaction occurred^ in the banking house where the president was
apparently engaged in performing his duties as such, the *bank was
liable on the guaranty. City Nat. Bank v. Thomas (Neb.), 65 N. W., 895.
10. Where a promissory note is transferred, and the collection of it is guaranteed by the payee in the following form, to wit, "This note is transferred, and the collection of the same guaranteed to the holder hereof,"
the makers can make any defence to a suit commenced by an assignee
that could have been made to a suit if commenced by the payee, notwithstanding the assignee may take the note before due and without
knowledge of any infirmity in the note. Omaha National Bank v.
Walker et ah, 5 Fed. Rep., 399.
11. A contract by a national bank to indemnify one for loss incurred as surety
on an attachment bond is not void on the ground of public policy, the
loss having occurred, though the bond is not given for the benefit of the
bank. Seeber v. Commercial Nat. Bank of Ogden, 77 Fed. Rep., 957.
12. The vice-president of a national bank, upon making a transfer for value of
certain notes belonging to the bank (the bank being the correspondent
of the transferee), executed this guaranty: "In accordance with your
telegram I herewith hand you ten notes of §5,000 each." " We debit your
account $50,000." "This bank hereby guarantees the payment of the
principal sum and interest of said notes." This was done in behalf of
the bank, and the notes were also endorsed by the same individual as
vice-president of the bank. It was done with the knowledge and consent
of the president and cashier of the bank, but without authority of the
directors, as a board, or the majority of its members individually. Held,
that the bank was liable on the guaranty. People's Bank of Belleville v.
Manufacturers' National Bank of Chicago, 101 U. 8., 181; 2 N B. C, 97.
13. F. owed H. & Co., on account, about $22,000. He settled this in part by a
cash payment, and in part by a transfer of promissory notes, payable to
himself, the payment of two of which, for $5,000 each, was guaranteed
by him in writing. H. & Co. transferred these notes to a bank as collateral to their own note for about $13,000. They then became insolvent,
and assigned all their estate to P. as assignee for distribution among
their creditors. The bank sued F. on his guaranty. He set up in defence
that his indebtedness to H. & Co. grew out of dealings in options in
grain and other commodities to be settled on the basis of "differences,"
and that it was invalidated by the statutes of Illinois, where the transactions took place. The court held that he could not maintain the statutory defence as against a bona fide holder of the guaranteed notes, and
gave judgment against him. Execution on this judgment being returned
unsatisfied, a bill was filed on behalf of the bank to obtain a discovery
of his property and the appointment of a receiver, to which F., and the
maker of the notes, and R., with others, were jmade defendants. P., the
assignee of H. & Co., was, on his own application, subsequently made a
defendant. An injunction issued, restraining each of the defendants
from disposing of any notes in his possession due to F. Subsequently
to these proceedings, F. assigned to R. the two notes which H. & Co. had
transferred to the bank. P., as assignee of H. & Co.,fileda cross-bill in
the equity suit, showing that the judgment in favor of the bank was
in excess of the balance due the bank by H. & Co. R.filedan answer and
a cross-bill in that suit, setting up his claim to the said notes, and maintaining that the judgment in favor of the bank was invalid, as being
in conflict with the statutes of Illinois. Held, (1) that the liability of
F. upon the guaranty was, as between the bank and him, fixed by the
judgment in the action at law; (2) that all the bank could equitably
claim in this suit was the amourifractually due it from H. & Co., which
was considerably less than the amount of the face of the notes; (3) that
H. Doc. 10
12
178
REPORT OF THE COMPTROLLER OF THE CURRENCY.
GUARANTY—Continued.
the transfer and guaranty of the notes to H. & Co. were void under the
Illinois statutes, and passed no title to them or their assignee; (4) that
R. was the equitable owner of the notes, and was entitled to receive
them on payment to the bank of the amount of the indebtedness of H. &
Co. to it; (5) that the assignment to R. having been made in good faith
and for a valuable consideration, he was a person interested in the object
to be attained by the proceedings within the intent of the statute. When,
by filing a replication to a plea in equity, issue is taken upon the plea, the
facts, if proven, will avail the defendant only so far as in law and equity
they ought to avail him. Pearee v. Bice, 142 U. S., 28.
14. A national bank went into voluntary, liquidation in September, 1873.
Before that it had become liable to a State bank as guarantor on sundry
notes made by a third person and which were discounted for it by the
State bank, "in August, 1874, transactions took place between the maker
of the notes and the State bank and the person who acted as the president of the national bank whereby the .maker was released from further
liability on the notes, but such acting president attempted to cpntinue
by agreement the liability of the national bank as guarantor. In a suit
begun in October, 1876, a judgment on the guaranty was obtained in
May, 1880, by the State bank against the national bank. In a suit
brought by a creditor against the national bank and its stockholders to
enforce their statutory liability for its debts the court, on an application
made in June, 1887, enquired into the liability of the stockholders to have
the claim of the State bank enforced as against them in view of the
transactions of August, 1874, and disallowed that claim. Held, (1) it
was proper to reexamine the claim; (2) the judgment against ihe bank
was not binding on the stockholders, in the sense that it could not be
reexamined; (3) the guaranty of the bank was released as to the stockholders by the release of the maker of the notes; (4) the rights of the
stockholders could not be affected by the acts of the president done after
the bank had gon e into liquidation. Schrader v. Manufacturers' National
Bank of Chicago, 183 U. S., Jan. 20, 1800, page 67.
15. A written promise and guaranty of the payment of a promissory note,
"with all legal or other expenses of or for collection," executed by the
indorser before the maturity of the note, covers reasonable attorney's
fees incurred
in the collection of the debt. McGhee v. Importers and
Traders9 National Bank, OS Ala., 102.
16. When a promissory note is indorsed to A. B. with the word "cashier"
added, it is presumptively the property of the bank of which he is the
cashier, as shown by parol evidence, and the bank may sue on it without
indorsement by him and without making him a party. Ib.
INCREASE OF CAPITAL STOCK. See Capital stock.
INDICTMENT: See False entries.
1. An indictment under act of July 12, 1882, amending sec. 5208, making it a
misdemeanor to " certify any check " drawn by a person not then having
on deposit sufficient money to meet same need not allege delivery of
check by bank after certification. United States v. Potter, 56 Fed.
Rep., 83.
2. When indictment alleges certification as accomplished, authentication will
not be presumed aslm essential part thereof, and hence it is unnecesary
to allege absence of required credit or deposit at time of authentication.
Ib.
3. The indictment in charging, in the language of sec. 5208, that the drawer
of the check had not on deposit, at the time it was certified, " an amount
of money equal to that specified " in the check is sufficient. Ib.
4. The indictment does not charge two offenses in the same count, because it
alleges therein that the check was certified " before the amount thereof
had been entered to the credit of the drawer on the books of the bank,"
and also at a time ;when the drawer did not " have on deposit an amount
of money equal to ' the amount of the check. Ib.
5. An indictment against the president for "aiding and abetting" cashier in
certifying check under prohibition can not be sustained. Ib.
6. An indictment charging defendants with aiding and abetting a director in
a willful misapplication of the money of an association must state facts
to show that there has beSl such misapplication committed by the
director. United States v. Warner, 26 Fed. Rep., 616.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
179
INDICTMENT: See False entries—Continued.
7. An indictment against the president of a national bank alleging that he
"unlawfully and willfully and with intent to injure and defraud the
said association for the use, benefit, and advantage of himself did misapply certain of the money and funds of the association which he * * *
then and there, with the intent aforesaid, paid and caused to be paid"
to certain persons named, was bad for failure to allege the fact that
made such pavment unlawful or criminal. United States v. Eno, 56
Fed. Rep., 218".
8. It is not essential that such indictment should allege that the acts charged
were done without the knowledge and assent of the directors of the
association. Ib.
9. In indictment under Rev. St., sec. 5209, for willfully misapplying the funds
of a national bank, it is not necessary to charge that the funds had been
previously intrusted to defendant, since such act may be done by an
officer or agent of the association without his having previously received
the funds into his manual possession. United States v. Northway, 129
U.S., 827.
'
10. In indictment charging president of a bank with aiding and abetting its
cashier in the misapplication of its funds, it is not necessary to aver that
he then and there knew that the person so aided and abetted was the
cashier. Ib.
11. A form of indictment which sufficiently describes and identifies the crime
of abstracting the funds of a national bank created by Rev. St., sec. 5209,
sufficiently states the character and capacity of the bank. Ib.
12. An indictment for willfully misapplying funds of a national bank (Rev.
St., sec. 5209), charging in general words fraudulent misapplication and
intent to defraud the bank, and describing specifically funds misapplied
and the manner of misapplication, need not negative every possible
theory consistent with an honest purpose in the disposition of the funds
specified. Evans v. United States, U S. Ct., 934; Ip., 039.
13. An indictment charging directors of a national banking association with
making false entries in a report of condition to the Comptroller of the
Currency can not he sustained under sec. 5209. United States-v. Potter,
56 Fed. Rep., 83.
14. The use in an indictment, under sec. 5209, of the words " then and there,"
in alleging that the defendant was president or director of such bank
and made alleged false entries, is not uncertain or repugnant merely
because in one place they may refer to the whole of a day and in another
to only one instant of the day. Ib.
15. The omission of the signs for dollars and cents in the recital of alleged
false entries in reports and misnomer of reports are immaterial where
reports are set out by their tenor in the indictment. Ib.
16. It is not necessary to allege specifically in such indictment that the reports
were transmitted to the Comptroller of the Currency or that they were
published. Ib.
17. Allegations that the false entries were made with intent to "injure and
defraud the said association and certain persons to the grand jurors
unknown " are sufficient. Ib.
18. An indictment against the president of a national bank, under sec. 5209,
for making false entries in the books of the bank, charging that it was
done '' with intent to defraud said association and certain persons to the
grand jurors unknown," is sufficient so far as concerns the allegations
of intent. United States v. Potter, 56 Fed. Rep., 97.
19. When indictment alleges that the false entries indicated that there was
then in the paying teller's department of the bank certain amount in
gold, legal tenders, and gold certificates, when in fact such amount was
not there, it is not necessary that it should further allege that such
amount was not then in other departments of the bank. Ib.
20. In addition to the entries themselves, the indictment need set oiit the
context only when it so modifies the entries as to be in presumption of
law a part of them. Ib.
21. The fact that the note teller's and paying teller's books, in which the
president is charged with making the false entries, are usually kept by
those officers without interference by the president does not invalidate
indictment thereon. Ib.
22. Counts charging false entries by the president in reports of condition of
the bank, which allege that reports were made in conformity to the law,
180
REPORT OF THE COMPTROLLER OP THE CURRENCY.
INDICTMENT: See False entries—Continued.
and then set them out by their tenor, are bad for their failure to allege
specifically that the reports were verified and attested by the cashier. Ib.
23. Where the entry whose tenor is set forth contains the words " See schedule," it is not a valid objection to the indictment that these words are
not explained. United States v. French et al., 57 Fed. Rep., 38l2.
24. It is sufficient if the indictment allege the substance of the reports in
question without setting them out in full. Ib.
25. An allegation in an indictment under sec. 5209 that defendant '' did make
a certain false entry in a certain report of the association " will not be
construed to mean that the entry was made after the report was completed and was, in fact, an alteration. Ib.
26. The preparation and completion of the report, the making of the false entry
therein, its verification, attestation, and delivery to the Comptroller may
be considered as simultaneous, and there is no repugnance in failing to
allege that any or all of these things occurred in consecutive order. Ib.
27. Though the counts in an indictment under this section for aiding and abetting the cashier in making such false entries described defendant as
"being then and there a director" of the bank in question, it can not be
held that they charge him in aiding and abetting in his official capacity. Ib.
28. Counts in such indictment which charge defendant with procuring and
counseling the false entry before the fact are valid, for such acts are
covered by the clause of the section extending the penalty to anyone who
*' abets " an officer or agent in the acts prohibited. Ib.
29. Indictment against president for false entry on books, held sufficient in form
and averments. United States v. Britton, 107 U. S., 655.
30. Indictment against president for fraudulent purchase of stock of the bank
is bad if it fails to state for whose use purchase was made, or if it states
that it was for use of the bank, or if it does not aver that it was not made
to prevent loss on previous debt. Ib.
31. Indictment for perjury against officer for false statement under sec. 5211,
Rev. St., is bad if, prior to act of 1881, chapter 82, his oath verifying
report was taken before notary appointed by a State. United States v.
Curtis, 107 U. S., 671.
32. An indictment of persons for aiding and abetting a president of a national
bank in misapplying its funds and making false entries in its books, with
intent to defraud it, in violation of Rev. St., sec. 5209, need not specifically set out the act or acts by which the aiding and abetting were consummated. Coffin v. United States, 15 S. Ct., 394.
33. An indictment of H. and other persons for violation of Rev. St., sec. 5209,
averred that "said H., then and there being president" of a certain
national bank, "by virtue of his said office as president aforesaid,"
"misapplied the funds " with intent to defraud, etc., and that such other
persons did unlawfully, feloniously, "knowingly," and with intent to
defraud, aid and abet the '' said H., as aforesaid." Held, that the indictment averred that the aiders and abettors knew that'll, was president
of the bank at the time it is averred the acts were committed. Ib.
34. Such indictment charged that H. did misapply the moneys of the bank
with intent to convert a certain sum to the use of a specified company
by causing it to be paid out of the moneys of the bank on a check drawn
on the bank by such company, which check was then and there cashed
and paid out of the bank's funds, which sum, and no part thereof, was
such company entitled to withdraw from the bank, because it had no
funds therein, and that said company was then and there insolvent, as
H. well knew, whereby said sum became lost to the bank. Held, that
the indictment averred the actual conversion of the sum misapplied. Ib.
35. Where an indictment under Rev. St., sec. 5209, against a president of a
national bank and others, for misapplying the funds of the bank, avers
that such funds were misapplied with intent to convert the same to the
use of a certain company, "and to other persons to the grand jury
unknown," the Government need not prove want of knowledge in the
grand jury as to such persons; and, in the absence of evidence on the
subject, the verity of the averment will be presumed. Ib.
36. No person, other than a witness undergoing examination and the Government attorney, can be present at the sessions of a grand jury; and an
indictment should be quashed where an expert witness remained in the
jury room while another witness was being examined, and put questions
to him. United States v. Edgerton, 80 Fed. Bep.9 374*
REPORT OF THE COMPTROLLER OF THE CURRENCY.
181
See False entries—Continued.
37. An indictment should be quashed when it appears that defendant was compelled by subpoena to attend before the grand jury, and give material
testimony, without knowing that his own conduct was under investigation. Ib.
INDICTMENT:
INJUNCTION:
1. Section 5242, Rev. St., providing that no injunctions shall issue from a
State court against a national bank before final judgment, does not
deprive the Federal court of power to issue such injunction oi to continue after removal of the case an injunction previously granted by a
State court. Hower v. Weiss Malting and Elevator Co. et ah, 55 Fed.
Rep.. 356.
2. State courts have no power to grant before final judgment an injunction
prohibiting a national bank from disposing of securities in its possession.
Freeman Manufacturing Company v. National Bank of Republic, 35
JST. E., 865.
3. The provisions of the national-bank act, forbidding such injunctions, were
not repealed by St. U. S. 1882, c. 290, sec. 4, or St. U. S. 1887, c. 373. sec.
4, or St. U. S. 1888, c. 866, sec. 4. Ib.
4» A bill which seeks to restrain the sale by a bank of property pledged as
collateral security to a note discounted by it, on the ground that the
president of the bank secretly agreed that he would see to the payment
of the note without sale of the collateral, does not state a case for equitable relief, since such agreement, being against the interest of the bank,
should not be enforced for the benefit of a party to it. Breyfogle et al.
v. Walsh etcil., 71 Fed. Rep., 898.
5. A decree dismissing an injunction because wrongfully sued out is conclusive as to the wrongful suing out when offered in evidence in an action
for damages against the surety on a bond, the undertaking of which is
that the principal will pay all damages which may be adjudged by reason
of the injunction, although the surety may not have been a party to the
injunction and there may have been no damages adjudged against the
principal. Bunt v. Rheum, 3 N. W., 667; 52 Iowa, 619, distinguished.
Shenandoah Nat. Bank v. Read (Iowa), 53 N W., 96.
6. A prayer for injunction to preserve property from sale pending litigation
can not be made a ground of equity jurisdiction when the property had
been sold when the bill was filed, which fact complainants knew, or
might have known. Cecil Nat. Bank v. Thurber (O. C. A.), 59 F., 913.
7. A bank recovered judgment at law by default on a note made by a wife to
the order of her husband, and subsequently the wife obtained an order
opening the judgment, with unrestricted leave to plead. She pleaded
that she occupied the position of surety on the note and was a married
woman, and also that it was a contract made with her husband and
therefore void at law. The bank thenfileda bill in equity for an injunction against setting up these defenses at law. On the trial of the issues
thus raised the defense of suretyship was not sustained. Held, that the
bank was in effect compelled to come into equity by defendant pleading
that the contract was between husband and wife and that, having established its case there on the merits, defendant should not be permitted to
litigate it again in the law courts. Hackettstown Nat. Bank y. Ming
(N.J. Ch.), 27 A., 920.
8. When a valid judgment has been obtained in a State court against a
national bank, and the lien thereof has attached to its property, before
the appointment of a receiver, Rev. St., § 720, applies to prohibit the
issue of an injuction by a Federal court, at the suit of the receiver, to
restrain the enforcement of such judgment. Baker v. Ault et al., 78
Fed. Rep., 394.
9. A Federal court will enjoin a sale of the real estate of a national bank to
enforce payment of taxes illegally assessed against its capital stock, under
a law which would make the sale a cloud on its title, though the State
law gives an action at law to recover back taxes illegally exacted. Brown
v. French, 80 Fed. Rep., 166.
10. On injunction to restrain the enforcement of a judgment on a note against
the maker, it appeared that the payee, before maturity, transferred it to
a bank as collateral; that the maker, in ignorance of the fact, paid it
to the payee, without receiving the note, upon his representation that
he had forgotten to bring it. After maturity the bank, pursuant to
182
REPORT OP THE COMPTROLLER OF THE CURRENCY.
INJUNCTION—Continued.
an agreement with a person who knew that it was up as collateral,
obtained judgment on it, and assigned the judgment and all other collateral paper to him, on his paying the principal debt. Among the collaterals were notes, on which this person was a surety, for a greater amount
than the principal debt, Held, that equity required the bank to resort
first to the other collaterals which it held, and this equity was not
changed by reducing the note to judgment, and that the assignee got no
greater rights than the bank had, and therefore could not collect the
judgment, whether the transaction be considered as a purchase by him,
or as a part payment of his own obligation. Barhorst et nx. v. Armstrong
etal, 4? Fed. Rep., 2.
INSOLVENT BANKS: See Preferred claims; Receiver.
1. A return of nulla bona upon an execution issued against the property of
a national bank is proof of its insolvency. Wheelock y. Kost, 77 III., 296.
2. The creditors of an insolvent national banking association in the hands of
a receiver are entitled to interest on their claims during the period of
administration. National Ban k of Commonwealth v. Mechanics' National
Bank, 94 TJ. S., 437; White v. Knox, 111 TJ. 8., 784.
3. A subscriber who has made payments on his subscription to the proposed
increase, believing that the statutory requirements would be complied
with, is entitled to have the amount thereof allowed as a claim against
the assets of the bank in the receiver's hands. Armstrong v. Stanage,
37 Fed. Rep,, 568.
4. The directors:? of a national bank voted to increase the capital stock "to
$1,000,000, and that the stockholaers "have the right to take new stock
at par to an equal amount to that then held by them." No subscription
books were opened, and the plaintiff did not subscribe for any of the new
stock, but paid the bank a sum equal to the amount of stock then held
by her, taking a receipt therefor "on account of subscription to new
stock." The new stock subscribed for and paid in did not amount to
enough to make the capital stock $1,000,000, and the directors then voted
that the capital stock be increased by the sum paid in. The Comptroller
of the Currency was notified that the capital stock of the bank had been
increased to that extent, and he issued a certificate authorizing the bank
to carry on business with that amount of capital stock. The amount
paid in, as above, was used by the bank in its general business, and lost
within a month after the certificate was issued, the bank having suspended. The plaintiff demanded back the amount paid in by her. Held,
that she was entitled to recover it, with interest from the date of her
demand. Eaton v. Pacific National Bank, 144 Mass., 260: 3 N. B. C.. 483.
5. A national bank determined to increase its capital stock from $300,000 to
,$500,000. The new stock subscriptions amounted to only $130,060. The
bank advertised an increase to $430,060. This was never authorized by
vote of the stockholders, nor certified to or approved by the Comptroller
of the Currency. The plaintiff subscribed and paid $2,000 for so much of
the originally proposed increase. Held, that plaintiff did not become a
stockholder, and when the bank became insolvent was entitled to judgment against the receiver for the amount so paid. Schierenberg v.
• Stephens, 32 Mo. App., 314; 3 N. B. C., 528.
6. Rev. St., sees. 5234 and 5239, prescribing the method of enforcing the
liability of the directors of national banks for violation of the banking
law, are exclusive of other remedies, and a creditor of an insolvent
bank, for which a receiver has been appointed, can not sue its directors
for the purpose of making them personally liable for the mismanagement of the bank. National Exchange Bank v. Peters et ah, 44 Fed.
Rep., 13.
7. A national bank does not lose its corporate existence by mere default in
paying its notes and the appointment of a receiver. Bank of Bethel
v. *Paqauioque Bank, 14 Wall., 383.
8. Such associations may be sued, though a receiver has been appointed and
is administering its concerns. Ib.
9. A creditor of an insolvent national bank, who establishes his debt by suit
and judgment after refusal of Comptroller to allow it, is entitled to
share in dividends on debt and interest so established as of day of failure
of bank, not for subsequent interest. White v. Knox, 111 TJ. S., 784.
10. The personal property of an insolvent bank in hands of a receiver i3
exempt from State taxation. Rosenblatt v. Johnston, 104 TJ. S., 462
REPORT OF THE COMPTROLLER OF THE CURRENCY.
183
INSOLVENT BANKS: See Preferred claims; Receiver—Continued.
11. When a creditor of a national bank is entitled to interest on the amount
of his dividend froni the time it was declared by a receiver of the bank.
Armstrong v. American Exchange National Bank, 133 U. S., 433.
12. In estimating the dividends to be x>aid out of the assets of an insolvent
association, the value of the claims at the time when the insolvency is
declared is to be taken as the basis of distribution. White v. Knox, 111
U.S., 784.
13. A creditor will not have a lien upon the funds of the association because
checks given in settlement of balances were fraudulent and were given
at a time when the bank was hopelessly insolvent and its officers were
contemplating flight. Citizens- National Bank v. Dowd, 35 Fed.
Rep., 340.
14. A suit against a national bank to enforce the collection of a demand is
abated by a decree dissolving the corporation and forfeiting its rights
and franchises. National Bank v. Colby,"21 Wall., 609; 1 N. B. C, 109.
15. The claims of depositors in a suspended national bank are, when proved to
the satisfaction of the Comptroller of the Currency, on the same footing
as if they were reduced to judgments. National Bank of Commonwealth
v. Mechanics'1 National Bank, 94 U. S. 437; 1 N. B. C, 133.
16. National banks are not subject to the bankrupt act, and bankruptcy courts
have no jurisdiction as against such associations. If insolvent, they can
be wound up only in the mode provided by the national banking act.
In re Manufacturers'' National Bank, 5 Bissell, 499; 1 N. B. C, 192-.
17. The plaintiff, a citizen of New York, claiming title by assignment to the
bonds deposited with the Treasurer of the United States to secure the circulation of a national bank, filed a bill setting forth that the Comptroller
of the Currency and the Treasurer refused to recognize his right to the
bonds or their proceeds; that the Comptroller had appointed one K., a
citizen of New York, receiver of the said bank, and intended to sell the
said bonds and to pay the proceeds, after redeeming the circulation of
the bank, to the general creditors of the bank, or to K. as such receiver,
and that K. claimed as such receiver an interest adverse to the plaintiff
in said bonds. The bill made the Comptroller, the Treasurer, and K.
parties defendant, and prayed a decree establishing the plaintiff's title
and requiring the Comptroller and the Treasurer to deliver to the plaintiff the surplus of the bonds after redeeming the notes of the bank, and
annulling the appointment of K. as receiver. K. demurred to the bill
for lack of equity. Held, that the demurrer must be sustained. Van
Antwerp v. Hulburd. 8 Blatchford, 2S2; 1 N. B. C, 219.
18. Per Woodruif, J. (1) The plaintiff could not question the validity of K.'s
appointment as receiver; (2) that, as the court could not grant the relief
as to the Comptroller and Treasurer, it could not as to K.; (3) that, as
under the national banking act the proceeds of the bonds could never
come into the possession of K., he had no concern in the suit; (4) that
the allegation that plaintiff was informed and believed that K. claimed
an interest in the bonds adverse to the plaintiff was not sufficient to
sustain the bill. Ib.
19. Per Hall, J. The residuary interest of the bank in the bonds was a part
of the assets of the bank, to which K., as receiver, was entitled, unless
the plaintiff's claim thereto was good, and that therefore the bill presented a question of property between plaintiff and K., but that, as
plaintiff and K. were residents of the same State, the circuit court had
not jurisdiction. Ib.
20. Where a national bank is declared in default by the Comptroller of the
Currency, and a receiver is appointed, and a sufficient fund is realized
from its assets to pay all claims against it and leave a surplus, the Comptroller should allow interest on the claims during the period of administration before appropriating the surplus to the stockholders of the
bank. Chemical National Bank v. Bailey, 12 Blatchford, 480; 1N. B. C.,
260.
21. An action of assumpsit to recover such interest will not lie against the
Comptroller of the Currency or the receiver of the bank, but will lie
against the bank. Ib.
22. Where a bank has by reason of its own default been placed in the hands
of a receiver, a demand of payment by a depositor is no longer a necessary condition precedent to a right of action for the deposit, and the
deposit bears interest from the time of such default. Ib.
184
REPORT OF THE COMPTROLLER OF THE CURRENCY.
INSOLVENT BANKS: See Preferred claims; Receiver—Continued.
23. The receiver of a national bank holds the same title to the assets of the
bank that the bank itself held; and he has no greater rights in enforcing their recovery than the bank itself would have had. Casey v. La
Soeiete de Credit Mobilier de Paris, 2 Woods, 77; 1 N. B. C. ,285.
24. Insolvent debtors of an insolvent national bank assign, giving preferences
in favor of the bank. Quaere, whether the debt preferred shall carryinterest. Held, that where there is nothing in the language of the assignment, or in the circumstances under which the debt was created, to
negative the presumption that the debt should bear interest, and nothing
in the conduct of the receiver of the national bank to estop him from
claiming interest, in such a case interest must be paid. Bain et al, v.
Peters, U Fed. Rep., 307.
25. The question whether a savings bank should be paid in full by an insolvent
national bank, pursuant to the State law (Laws N. Y. 1882, chap. 409,
sec. 282; Bank v. Davis, 26 N. Y. Supp., 200; 73 Hun., 357), or pro rata,
as provided by the Rev. St., sees. 5236, 5242. Held, upon a motion to
remand, to be a controversy "arising under the laws of the United
States." Auburn Savings Bank v. Hayes, 61 Fed. Rep., 911.
26. The receipt by a bank of the proceeds of a fraudulent sale of stock belonging to it, and the subsequent appointment of a receiver, give its creditors no such right in the proceeds as will prevent the purchaser from
rescinding the sale and requiring restitution. Men-ill v. Florida Land
and Improvement Co., 60 Fed. Rep., 17.
27. When a bank has become hopelessly insolvent, and its president knows
that it is so, it is a fraud to receive deposits of checks from an innocent
depositor, ignorant of its condition, and he can reclaim them or their
proceeds; and the pleadings in this case are so framed as to give the
plaintiff in error the benefit of this principle. St. Louis and San Francisco Railway Co. v. Johnston, 133 U. S., 566.
28. Sureties on indebtedness of insolvent bank are not entitled to prove any
claim against it by reason of the enforcement of their liability as such.
Steivarty. Armstrong, 56 Fed. Rep., 167.
29. Where an indorser pays a note to a bank and takes a receipt containing an
order for a surrender of the note on return of the receipt, the relation
between the bank and the indorser is not that of debtor and creditor,
but is a fiduciary relation, entitling the indorser, on the bank becoming
insolvent without applying the money on the note or procuring its surrender, to have the assets in the hands of its receiver applied in payment
thereof. Massey v. Fisher, 62 Fed. Rep., 958.
30. The fact that the money was not marked, and by a mingling with other
funds of the bank lost its identity, does not affect the right to recovery
in full, if it can be traced to the vaults of the bank and it appears that
a sum equivalent to it remained continuously therein until removed by
the receiver. Ib.
31. The appointment of a receiver for an insolvent national bank under act of
Congress of June 30,1876, sec. 1, which authorizes the Comptroller, when
satisfied of the insolvency of a banking association, to appoint a receiver,
"who shall proceed to close up such association and enforce the personal
liability of the shareholders," does not dissolve the corporation. Chemical National Bank v. Hartford Deposit Company {III. Sup.), 41N. E., 225.
32. One induced to subscribe for certificates alleged to represent an increase
of the capital stock of a national bank at a time when no increase had
been authorized, on false representations of the cashier as to the bank's
condition, it being in fact insolvent at the time, is entitled to a judgment
against the bank and its receiver for the purchase money paid. Newbegin v. Newton National Bank (C.C.A.), 66 F., 701.
33. A contract between two national banks that the proceeds of paper, discounted by one for the other, should not be drawn on in advance of the
maturity of such paper, is not affected by the subsequent fraud of the
bank obtaining the discount in reporting such proceeds to the Comptroller of the Currency as part of its cash reserve. Fisher v. Tradesmen's
National Bank (C.C.A.), 64 F, 706.
34. A contract by which one bank pledges any of its property in the hands of
another bank, as collateral to notes discounted for and guaranteed by it,
authorizes, the discounting bank to hold a deposit balance, standing to
the credit, of the borrowing bank at the time of its insolvency, as collateral to any liability, then or at maturity of the discounted notes, until
REPORT OF THE COMPTROLLER OF THE CURRENCY.
185
INSOLVENT BANKS: See Preferred claims; Receiver—Continued.
the amount of the lien has been ascertained. Fisher v. Continental
National Bank (CO. A.), 64 F, 707.
35. A statement by the president of a bank, for the purpose of procuring from
another bank a discount of paper, that such former bank is in good condition, when in fact it is hopelessly insolvent in consequence of the president's own malversation, is a fraud, and entitles the discounting bank to
recover back the proceeds of the discount. Fisher v. United States
National Bank (C.C.A.), 64 F., 710.
36. The fact that an insolvent national bank has gone into voluntary liquidation does not absolve it from liability to be garnished. Birmingham
National Bank v. Mayer (Ala.), 16 So.,520.
37. Rev. Stat., sec. 5242, which invalidates all transfers of the notes, bonds, or
bills of exchange of a national bank after the commission of an act of
insolvency with a view to the preference of one creditor over another,
does not prohibit a bank which has in good faith accepted the draft of a
national bank the day before the latter's insolvency, and afterwards
paid the same, from applying the proceeds of collections made by it on
paper in its hands belonging to the insolvent bank, to the payment of
the draft, since its lien on such collection runs from the date of the
acceptance. In re Armstrong, 41 Fed, Rep., 381.
38. Sections 5151 and 5239, Revised Statutes, exclude banking associations from
none of the remedies for the collection of debts, claims, and dues for the
bank or its creditors provided by the general rules and principles of law
and equity, but they impose upon shareholders and directors additional
liabilities and subject them to proper remedies for their enforcement.
Hayden v. TJiompson (C. C. A.).
39. In the State of Nebraska a suit to recover from an innocent shareholder of
an insolvent national bank an unearned dividend which he has received
in good faith without notice of any fact that would lead a reasonably
prudent man to learn that the dividend was not earned is barred in four
years from its receipt. Hayden v. Thompson (C. C. A.).
40. The fact that trustees holding lands in trust for a national bank formally
and regularly execute a deed thereof to a third party itself raises a presumption that the deed was made pursuant to a regular resolution of
the bank's board of directors, and the deed must be held sufficient to convey the legal title where there is nothing to rebut the presumption.
Butler et al., v. Cockrill, 73 Fed. Rep., 945.
41. A bank for which certain mill property was held in trust caused the same
to be conveyed to a> corporation, organized among its own officers and
directors, with a view to loaning to such corporation money wherewith
to repair and operate the mills and make them salable. The bank directors who subscribed for stock in the mill corporation had a secret agreement with the bank that, after a sale of the property was effected, the
proceeds should be first applied to repay the amount of their subscriptions. The money was loaned accordingly, the bank taking the mill
company's notes, and discounting them with innocent third parties. No
sale was effected, and the bank and mill company failed, and all their
property went into the hands of the bank's receiver. Thereafter the mill
company gave to such subscribers its own notes, secured by mortgage,
for the amounts paid on the stock, and the notes were then transferred
to alleged innocent purchasers. Held, that these notes were without
consideration, that this was a futile attempt to divert the property of an
insolvent corporation from its creditors tb its stockholders, and that the
proceeds of the receiver's sale of the mill property must 'be equally distributed among the holders of the notes given by it to the bank for the
borrowed money, the receiver taking, for the bank's creditors, the proportion applicable to such of the notes as were retained by the bank. Ib.
42. A depositor who receives an ordinary certificate of deposit, and whose
money is mingled with the other funds of a bank, is not entitled, on the
insolvency of the bank, to any preference over other creditors, even
though the banker promised him to keep his money separate from the
other funds. Bayor v. American Trust & Savings Bank (HI. Sup.), 41
N. E., 622.
43. On the insolvency of a bank which has collected notes sent to it for collection, and failed to remit the proceeds, a trust will be imposed on the
assets of the bank in favor of the person sending them, as against the
general creditors of the bank, if it is proven that the moneys collected
186
REPORT OF THE COMPTROLLER OF THE CURRENCY.
INSOLVENT BANKS: See Preferred claims; Receiver—Continued.
were deposited in the bank and commingled with other funds of the
bank, or if they went into property represented by the assets in the
hands of the assignee of the bank. Winstandley v. Second Nat. Bank,
(Ind. App.) 41 N. E., 956.
44. The California'' Bank Commissioners'Act" (St. 1877-78, p. 740, as amended
by St. 1886-87, p. 90) provides in section 11 that if the commissioners
shall find that any bank has violated its charter or law, or is conducting
business in an iinsafe manner, they shall require it to discontinue such
practices; and in case of refusal, or whenever it shall appear to the
commissioners unsafe for the bank to continue business, they shall notify
the attorney-general, who may commence suit to enjoin the transaction
of business by such bank; and, upon the hearing of such suit, the court
may issue the injunction, and direct the commissioners to take such proceedings against the bank as may be decided on by its creditors. The
section also empowers the commissioners to supervise the affairs of banks
in process of liquidation, limit the number of their officers and enrployees,
and requires reports to the commissioners by such banks. Held, that a
court in which proceedings are instituted by the attorney-general against
a bank pursuant to such statute has no jurisdiction to appoint a receiver
of the property of the bank in such proceedings, though the bank commissioners and the creditors of the bank consent, and though there are
provisions in the Code of Civil Procedure authorizing the appointment
of receivers in other proceedings. Murray v. American Surety Co. of
New York {C.C.A.), 70 F.,341.
45. Where plaintiff sent a note and mortgage to a bank with directions to collect the same and "forward draft" for the amount less its collection fee,
the money received by the bank in payment thereof was not impressed
with a trust in plaintiff's favor so as to entitle her to recover the whole
amount as a preferred claim from a receiver appointed for the bank after
the collection was made, though said bank was insolvent at the time it
received said note and mortgage, and though payment was made by the
mortgagor with a check drawn on the bank. Sayles v. Cox {Tenn.),32
S. IF., 6:26.
46. Where, between suspension by a bank and commencement of an action
for and resulting in its dissolution and appointment of a receiver, one
liable to it as indorsex on notes takes assignments of deposit accounts,
he may offset them against his liability, in an action by the receiver,
unless it be shown that the bank was insolvent at the time of the assignment of the accounts; and this is not shown by the recital in an agreed
statement of facts that, at the commencement of the action to dissolve,
the bank "was insolvent, having suspended its business" on a certain
day. Higgins v. Worthington (SUJJ. ), 35 N, Y. S., 815.
47. Where a check payable to two persons as Government officers is indorsed
by one of «theni for both, by indorsement showing their official character, and deposited in a bank to be credited to his individual account,
and thereby becomes mingled with the funds of the bank, the fact that
the check was intrusted to them as officers can not be urged by the payees
to charge the proceeds as a trust fund in the hands of an assignee in
insolvency of the bank, in an action to which the Government is not
party, and in which the authority of the depositing payee to act for his
copayee is not denied. Meldrum v. Henderson (Colo., App.), 43P.. I48.
48. A creditor of an insolvent national bank is entitled to prove the whole
amount of the claims against it held by him, without reference to the
collateral held to secure such claims. Armstrong v. Bank, S C. C. A.,
155; 59 Fed., 372; 16 U. S. App., 465, followed. Merrill v. First Nat.
Bank of Jacksonville, 75 Fed. Rep., 14s.
49. It seems that an accounting of the assets which have come to the hands
of the receiver of an insolvent national bank can not bo decreed in a
suit to which the Comptroller of the Currency is not a party. Ib.
50. In a suit against a receiver of an insolvent national bank to establish the
claim of a creditor and his right to a dividend, the decree should not
direct the payment of a dividend by the receiver, since the assets of siich
bank are, under the statutes, entirely within the control and disposition
of the Comptroller of the Currency/but such decree should direct that
the claim of the creditor, as established, be certified to the Comptroller,
to be paid in due course of administration. Ib.
51. Where a railroad company is in the hands of a receiver, though at the
REPORT OF THE COMPTROLLER OF THE CURRENCY.
187
INSOLVENT BANKS: See Preferred claims; Receiver—Continued.
instance of the holders of a mortgage, the court has no power to appropriate the corpus of the property to the payment of claims for operating
expenses in preference to the prior mortgage debts, in the absence of a
statute, at the time the mortgage was executed, giving such claims a
prior lien on the corpus of the property. Farmers & Merchants' Nat.
Bank v. Waco Electric Railway & Light Co. {Tex. Civ. App.), 86 S. W.,
131; Metropolitan Trust Co. v. Farmers & Merchants' Nat. Bank, ib.
52. While the N. Bank was in embarassed circumstances, plaintiff was
induced, by the fraudulent misrepresentations of its cashier, to subscribe, in May, 1890, for 62 shares of a proposed increase of its capital
stock, and to pay in a large sum of money therefor. In the following
November the bank failed, and the plaintiff, who lived at a distance,
in another State, receiving then his first intimation that anything was
wrong, proceeded to make inquiries, and, as a result, instituted proceedings before the Comptroller of the Currency to have the stock standing in his name declared void, and himself not a stockholder. These
proceedings failing, he took steps in May, 1891, to have a bill filed to
rescind his subscription. At the request, however, of parties who were
trying to reorganize the bank, he consented to withdraw such suit, and
surrender his stock to be canceled, upon an express agreement that it
should be without prejudice to his right to sue the bank for the fraud
by which he had been induced to subscribe and pay his money therefor.
Plaintiff did not participate in the reorganization, and consistently
maintained that he was not a stockholder, and that the bank was liable
to him for the money paid. Upon the reorganization the creditors of
the bank accepted in settlement a payment in cash, and certain certificates of indebtedness. In November, 1891, plaintiff brought this action
against the bank to recover the money paid by him, as a deposit. In
December, 1892, the bank failed again. Held, that the occurrence of
the insolvency of the bank before the commencement of x>laintiff 's action
did not preclude him from rescinding his subscription and recovering
back the money paid, for his stock. Newton Nat. Bank v. Newbegin (C.
C.A.),74F., 135.
53. One who, through his own fault, fails to present his claim against an
assigned estate within the time prescribed by law in conformity with
the order of the county court is forever barred from participating in
the distribution. Commercial Nat. Bank v. Lipp (Neb.), 65 N. W.,5777.
54. In an action for an alleged balance, it appeared that defendants McG-. and
W. illegally undertook to corner the lard market; that McG. was a
partner in the firm through whom the transactions were carried on, but
that W. was not; that the deal ruined the firm, and that the receiver
for it undertook to effect a settlement; that defendants were personally
liable for a x>art of the indebtedness by their indorsements on the firm's
notes, and that at the receiver's solicitation they agreed to contribute
a certain sum each on consideration of a release from all creditors; that
the receiver thereupon submitted the firm's proposition to pay 50 per
cent of the indebtedness, in full settlement of all unsecured claims,
stating that the affairs of the firm were in great confusion and that
unless the compromise were effected the matter would " only terminated after long, vexatious, and fruitless litigation;" that all of the
creditors accepted the payment and signed a release in full. Held, that
the transaction was a valid compromise. (Winslow and Pinney, JJ.,
dissenting.) Continental Nat. Bank v. McGeoch (Wis.), 66 N. W., 606.
55. Where, on the issue of a fraudulent preference of a creditor, the verdict
and findings cover all the material, controverted, and issuable facts, a
party can not urge,- on appeal, certain transactions in evidence from
which a preference might have been found, where there was no request
for the trial court to submit them to the jury for determination. 1 b.
56. Where a corporation borrowed money, and directed its officers to pay over
the same to another creditor, the authority of the officers to pay over
said money terminated by the appointment of a receiver for said corporation. First Nat. Bank v. Dovetail Body & Gear Co. (hid. Sup.), J$
N. E., 924.
57. Remittances made by a national bank to its correspondents, in the ordinary course of business, before the commission of any act of insolvency,
are not void under Rev. St., § 5242, though the bank is in fact insolvent
at the time, and is closed by the bank examiner before the remittances
188
REPORT OF THE COMPTROLLER OF THE CURRENCY.
INSOLVENT BANKS: See Preferred claims; Receiver—Continued.
are actually received by the correspondent banks. Hayden v. Chemical
Nat. Bank, 80 Fed, Rep., 587.
58. The Third National Bank in New York was the correspondent of the Albion
bank, a country bank. W., during part of the time in which the transactions in controversy took place, was cashier, and during the remainder
was president of the Albion bank. During all the time W. practically
managed that bank, and his codirectors and other officers had little or
no oversight of its affairs. He was engaged in stock speculations on his
own account in New York, and drew from time to time for his own purposes in favor of K. & Co., his brokers, on the bank balance with the
Third National Bank. K. & Co. from time to time returned to that bank
sums to be credited to the Albion bank. The latter bank eventually
became insolvent, being ruined by fraudulent operations of W., who
disappeared, and was put in the hands of a receiver, who brought suit
against K. & Co. to recover the sums so paid to them by W. out of the
balance to the credit of the bank with the Third National. K. & Co.
claimed to offset the return payments made by them to the Third
National, but the trial court ruled that they were not entitled to do it,
and no question in respect of them was submitted to the jury. Held,
that the defendants were entitled to have it submitted to the jury
whether the other directors and officers of the Albion bank might not
in the exercise of proper and reasonable care have ascertained that
these moneys had been deposited to the credit of the Albion bank, and
whether they would or would not have accepted such deposits as the
return of the moneys to the bank. Kissam v. Anderson,^ 145 U. S., 435,
59. The time of commencement of judicial proceedings to avoid a statute bar
may be shown by parol. Witters, Receiver, v. Sotvles and others, Assignees, 32 Fed. Rep., 765.
60. A case will not be reopened for the introduction of newly discovered evidence where such evidence is merely cumulative and its sources were
well known to the parties at the first hearing. Ib,
61. Proceedings upon a decree will be stayed for the purpose of allowing parties to take and file testimony newly discovered, when such testimony
appears to be material and its materiality was not so direct and apparent that the failure to discover and produce it on the first hearing
amounted to laches. Ib.
62. Defendant was heavily indebted to the bank of which he was cashier, and
within four months of the filing of a petition by a creditor to have him
declared an insolvent (under Rev. Laws Vt., sec. 1870) transferred certain securities to the bank with a view to preferring it over his other
creditors. Held, that knowledge on the part of defendant of his insolvency affected the bank of which he was cashier with such knowledge
and made the transfer of such securities void, under Rev. Laws Vt.,
sec. 1860, which provides that a conveyance made by an insolvent, or
one in contemplation of insolvency, within four months before the
filing of a petition of insolvency by or against him, with a view to
giving a preference to certaiii of his creditors, the latter having knowledge of his insolvency, is void. Witters, v. Sowles and others, 32 Fed.
Rep., 762.
63. Other securities were deposited by the cashier with his bank and an equal
amount of his own paper withdrawn. Held, that title to the securities
immediately vested in the bank, and, such deposit taking place more
than four months before the filing of the petition in insolvency, the
transfer did not come within the purview of the statute. Ib.
64. Defendant, being indebted to the bank of which he was cashier, transferred to it on the books of another bank the stock which he held in the
latter, but did not deposit the certificates for such stock in his own bank
and take up his paper held by it until some time later. Held, that the
title of defendant's bank to the stock transferred dated from the deposit
of the certificates with it and not from the transfer on the books of the
other bank. Ib.
65. A national-bank examiner is not an officer osr agent of the bank and has
no authority as such to act for the bank and cannot bind it by any
act done in its behalf. Ib.
66. In an action against the receiver
of a bank for dividends upon a debt for
a deposit in the name of u S., trustee," the mere general statement of S.
that the money deposited was his daughter's, in connection with evi-
REPORT OF THE COMPTROLLER OF THE CURRENCY.
189
INSOLVENT BANKS: See Preferred claims; Receiver—Continued.
dence that she owned property of which he had the management and
from which the fund deposited might have been derived, it not being
shown that it was derived therefrom, is not sufficient to enable the
daughter to recover. Soivles et al. v. Witters, 35 Fed, Rep., 463.
67. Where a bank, knowing its insolvency, receives from a customer as cash
a check on a foreign bank and sends the paper to its correspondent, who
credits the check to it as cash, and subsequently pays the proceeds thereof
to a receiver appointed for it in the meantime, it is presumed, in an action
by the depositor against the receiver to recover the proceeds, that the
correspondent credited the check to the bank before its failure. Friberg
v. Cox (Tenn.Sup.),37 S.W.,283.
68. The burden is on one who transferred a draft to a bank prior to its failure,
and who seeks to follow and reclaim the proceeds as against a receiver,
to show that they were not received and mingled with the other funds
of the bank before the failure; and, where they were placed to its credit
by a correspondent on the same day the receiver was appointed, in the
absence of further proof as to the exact time it will be presumed that
the credit was given before the receiver was appointed. Klepper v. Cox
(Tenn. Slip. ),37 S.W., 284.
69. Money received by a bank and entered to the depositor's general credit as
cash can not be reclaimed after the insolvency of the bank on the ground
that the bank officials had knowledge of the insolvency when they
received the deposit, there being- no means of identifying and separating it from the funds on hand when the receiver took charge. Bruner v.
First Nat.Bank (Tenn. Slip.),37 S.W.,286.
70. Where a bank, knowing its insolvency, receives a check, which it credits to
the depositor as cash and then sends to a correspondent, who, after the
failure of said bank, but without notice thereof, credits the check to it
as cash, and subsequently pays over the proceeds to the receiver, the
depositor may recover such proceeds as a preferred claim. Ib.
71. The president of a bank, having embezzled funds of the bank on deposit
with its reserve agent, replaced such funds with money borrowed by
him on the bank's note without the directors' knowledge, and such
borrowed money was thereafter drawn out to pay the bank's lawful
debts. Held, that the bank having received the benefit of the loan
through its president, it was affected with his knowledge of the loan,
and hence was liable to the lender as for money had and received to
its use. Ditty v. Dominion Nat. Bank of Bristol, Va. (O. C. A.), 75
F., 769.
72. The president of a bank has authority by virtue of his office to make a
valid assignment of a judgment in favor of the bank. Guernsey v. Black
Diamond Coal and Mining Co. {Iowa), 68 N. W., 777.
73. Where a depositor in a bank obtains from it two drafts upon another
bank, paying therefor by checks against his deposit, the relation between
the bank and the depositor with respect to such drafts remains that of
debtor and creditor, and is not changed to a fiduciary relation, entitling
the depositor, upon the bank becoming insolvent before the drafts are
paid, to have the assets in the hands of its receiver applied by preference to the payment of such drafts in full. Jewett et al. v. Yardley, 81
Fed. Rep., 920.
74. A stockholder in a national bank is liable to the receiver thereof on a note
given to the bank for capital stock. Hepburn v. Kincannon (Miss.),
21 So., 569.
INTEREST: See Usury; Insolvent banks.
1. The provision in sec. 30 of the act of 1864 "that where, by the law of any
State, a different rate is limited for banks of issue organized under State
laws, the rate so limited shall be allowed for associations organized in
any such State under the act," is enabling, and not restrictive; and,
therefore, a national banking association in any State may stipulate for
as high a rate of interest as by the laws of such State a natural person
may, although State banks of issue are restricted to a less rate. Tiffany*
v. National Bank of the State of Missouri, 18 Wall., 409.
2. Bank may take the rate of interest allowed by the State to natural persons
generally, an.d a higher rate where State banks of issue can take it. Ib.
3. But it is not to be inferred from Tiffany v. National Bank of Missouri that
whatever by the laws of the State is lawful for natural persons in acquir-
190
REPORT OF THE COMPTROLLER OF THE CURRENCY.
INTEREST: See Usury; Insolvent banks—Continued.
ing title to negotiable paper by discount is lawful for national banks.
National Bank v. Johnson, 104 U. S., 271.
4. May charge rate of interest allowed to natural persons in the State or Territory where bank is located, but can not take more, even on discount of
paper for third party, without it being usury. Ib.
5. The interest which a national banking association may charge is limited
to the rate allowed to the banks of the State generally; and the fact that
a few of the State banks are specially authorized to take a higher rate is
not a warrant for a national banking association to do so. Duncan v.
First National Bank of Mount Pleasant, 11 Bank Mag., 787; 1 N. B. C,
360; First National Bank v. Gruber, 87 Penn. St., 468.
6. Where the State law does not limit the rate of interest which may be
charged on loans *to corporations, a national banking association located
in that State can not charge more than 7 per cent interest on such loans.
In re Wild, 11 Blatch.. 243.
7. Where by the statutes of the State parties are authorized to contract for
any rate of interest, national banking associations in that State may
likewise contract for any rate, and are not limited to 7 per cent. Hines
v. Marmolejo, GO Cal., 2-20.
8. Under Rev. St., sec. 5197, authorizing national banks to charge any rate of
interest allowed by the law of the State wherein such bank is organized,
and the statute fixing a legal rate of interest, a national bank in Colorado may charge interest at any agreed rate. Rockwell v. Farmers'
National Bank, 30 P., 905.
9. As act of 1873 (70 Ohio Laws, 178) repeals the statute fixing the rate of
interest for banks of issue, a national bank may charge interest at 8
per cent under Rev. St., sec. 3181. La Dow v. First National Bank, 37
N. E.,11.
10. The decisions of the United States Supreme Court teach that the statute
referred to is to be liberally construed in favor of national banks, and
even when the language of the statute would restrict them to a less rate
of interest than is allowed to individuals the intendment of the law must
be presumed to have been otherwise. Tiffany v. National Bank of Missouri held that the intent of the law was to put national banks on an
equal footing with State banks; to allow the State banks to charge any
amount of interest and national banks only 8 per cent would violate that
intention; to say that national banks could only charge 7 per cent would
be to say that the State had prescribed no rate of interest. National
Bank of Jefferson v. Bruhn & Williams, 64 Tex., 571.
11. Where drafts are from time to time deposited in a bank; some of them
being payable on demand and some on time, an agreement between the
bank and the depositor that credit shall be given for such drafts on the
day after their deposit, the depositor being charged the full legal rate
for any overdraft, does not constitute usury when such agreement is
made in good faith in order to save involved calculations. Timberlake
et al. v. First National Bank,43 Fed. Rep.,281.
12. Charging a depositor, by agreement, at the end of each month, with interest at the full legal rate on his overdraft, and adding such charge to the
overdraft, does not constitute usury. Ib.
13. Under Code Miss., 1880, which only allows interest on the amount of money
actually lent, a national bank in that State can not deduct interest in
advance. Ib.
14. Under the national banking act, any national bank in Pennsylvania can
charge and take the same rate of interest as any State bank of issue is
authorized to charge. First National Bank of Mount Pleasant v. Tinstmanf 36 Legal Intelligence, 228; 2 N. B. C, 182.
15. Interest on dividends should not be allowed in favor of one who voluntarily
delayed presenting his claim until long after the dividends were declared,
although the delay was due to a mistaken belief that he had a right to
pay his claim in full from collaterals in his hands. Chemical Nafl Bank
v. Armstrong, 59 Fed. Rep,, 372.
lfr. The refusal of a creditor to accept the receiver's offer to allow part of a
claim without prejudice to a suit for allowance of the remainder, or to
the receiver's right to still further reduce the claim if the court should
hold such reduction proper, bars the creditor's right to interest on subsequent dividends on the part offered to be allowed, although it is subsequently adjudged that the whole of his claim should have been allowed;
but he is entitled to interest on the dividends on the part rejected. Ib.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
191
INTEREST: See Usury; Insolvent banks—Continued.
17. In case of book accounts in favor of depositors, interest begins to run
against an association in liquidation from the date of the suspension of
business. Richmond v. Irons, 121 U. S., 27.
18. There is an established rate of interest in Washington (10 per cent), and
the fact that by special contracts different rates may be collected does
not affect the question, and therefore a national bank may charge that
rate. Yakima National Bank v. Knipe, 33 P., 834; 6 Wash., 34$,
19. The fact that there are several entries in the -books of a bank and in the pass
book of a depositor of allowance of interest on his account is not sufficient to prove a contract by the bank to pay interest while the deposit
should remain, where it is proven that after the entries were made the
officers of the bank, on several occasions, told the depositor that it was
against their rules to pay interest, and that they would not pay it, and
that he apparently acquiesced. McLoghUn v. National Mohawk Valley
Bank, 139 N. Y. St., 514; 34 N. E., 1095.
20. Rev. St. U. S., sec. 5197, authorizes national banks to take interest at the
rate allowed in the State where the bank is located, and, when no rate
is fixed by the laws of such State, they are authorized to take interest at
a rate not exceeding 7 per cent. Held, that since 1 Hill's Code, sec. 2796,
and Sess. Laws 1893, page 29, allow individuals and State banks to take
any rate of interest agreed to in writing by the parties to the contract,
national banks have the same privilege. Wolverton v. Exchange National
Bank (Wash.), 39 P., 247.
21. A stockholder in a bank is not entitled to interest from the bank, either on
ordinary dividends declared or on money due him from a reduction of
capital stock, for a period during which the bank was prevented from
paying him the same by attachments of his stock in suits of other parties,
though the money thus belonging to him was during such time mingled
by the bank with its general assets, the bank being ready and willing to
pay over the same but for the attachments. Mustard Y. Union Nat
Bank, 29 A., 977; 86 Me,, 177.
JURISDICTIONS: See Actions.
1. In an action against a national bank in a circuit court of the United States,
if all the parties are citizens of the district in which the bank is situated,
and the action does not come under sec. 5209 or sec. 5239, Rev. St., the
circuit court has no jurisdiction. Whittemore v. Amoskeag National
Bank, 134 U. S., 527.
2. The Federal courts have jurisdiction of an action between a national bank
located in one State and a citizen of another State. First National Bank
v. Forest, 40 Fed. Rep., 705.
3. State courts have jurisdiction of suits by and against national banking
associations. Bank of Bethel v. Pahquioque Bank, 14 Wall., 383; Ord~
way v. Central National Bank, 47 Md., 217 and Claflin v. Houseman, 93
U/S.,130.
4. Where a national banking association is caed in a State court, the suit
must be brought in the city or county in which the bank is located.
Cadle v. Tracy, 11 Blotch., 101.
5. But in a State where the holder may sue without respect to the ownership,
an association may bring suit upon paper so acquired. National Pemberton Bank v. Porter, 125 Mass., 333; Atlas National Bank v. Savery,
127 Mass., 75.
6. The words of restriction to the place where said association is situated
apply to the county and municipal courts, and not to the State courts.
In the State courts of general jurisdiction a national banking association
can be sued whenever an individual can be for the same cause. Talmage
v. Third National Bank, 27 Hun., 61.
7. A State court can entertain an action brought to recover of a national
banking association the penalty for taking usury. Ordway v. The Central National Bank,47 Md., 217; Hade v.McVay, 31 Ohio St., 231; Bletz
v. Columbia National Bank, 87 Penn. St., 87.
8. State courts have no jurisdiction of the case of an embezzlement of the
funds of the association by one of its officers. Commonwealth v. Felton
101 Mass.,204; Commonwealth ex rel. Torreyv. Ketner, 92 Penn. St., 372.
9. The defense of usury may be set up in action brought in a State court.
National Bank of Winterset v. Eyre, 52 Iowa, 114.
10. A national banking association is for jurisdictional purposes a citizen of
the State in which it is located. Davis v. Cook, 9 Nev., 134.
192
REPORT OF THE COMPTROLLER OF THE CURRENCY.
JURISDICTIONS: See Actions—Continued.
11. The offense of making false entries in the books of a bank, for which an
officer of the bank is liable to punishment under sec. 5209, since it is
not a crime of which the State courts have concurrent jurisdiction,
under sec. 5328, is exclusively cognizable by the Federal courts. In re
Eno, 54 Fed. Rep., 669.
12. Under the provisions of the act of August 13, 1888, national banks are
deemed to be, for jurisdictional purposes, citizens of the State wherein
they are located, and they no longer possess the right of removal on the
ground that they are Federal corporations. Burnham et al. v. First
National Bank of Leoti, 53 Fed. Rep., 163.
13. An action for money against a national bank whose corporate existence is
admitted is not a suit arising under the laws of the United States.
Ulster County Savings Institution v. Fourth National Bank, 8 N. Y., 162.
14. The provision that the Federal courts shall not have jurisdiction of an
action on a promissory note or other chose in action by an assignee
thereof, unless the action might have been maintained in such courts if
no assignment or transfer had been made (act August 13,1888), does not
apply to the indorsement and transfer of the payee of notes which were
made to him merely that he might as agent of the maker raise money
for it by negotiating them with third persons. Waehusett National Bank
v. Sioux City Stove Works, 56 Fed. Rep., 321.
15. A suit on the official bond of the cashier of a national bank, conditioned
for a faithful performance of the duties thereof, " according to law and
the by-laws " of the bank, involves a Federal question and is maintainable in a Federal court irrespective of the citizenship of the parties.
Walker et al. y. Windsor National Bank, 56 Fed. Rep., 76.
16. In a suit which is properly brought in a Federal court, because it involves
a Federal question, the court has full jurisdiction of the defendant,
who, though a resident of another district, waives his personal privilege of being sued in his district by voluntarily appearing, Ib.
17. The exemption of national banks from suits in State courts in other than
their own county or city, by act of February 18,1875 (18 St., 316, chap.
80) was a personal privilege which could be waived by appearing to
such suit and not claiming the immunity. First National Bank v.
Morgan, 132 U. S., Ul.
18. The provision in act of July 12,1882 (22 St., 163, chap. 290, sec. 4), respecting suits by or against national banks, refers only to suits brought after
the passage of that act. Ib.
19. This court has jurisdiction to review a judgment in State courts involving the question whether a national bank is exempted from liability to
account for bonds purchased by it on condition of selling back on
demand. Logan Bank v. Townsend, 139 U. S., 67.
20. When transaction of transfer of national-bank shares does not present a
case arising under national banking act, and so involving a Federal
question. Le Sassier v. Kennedy, 123 U. S., 521.
21. State courts have no jurisdiction of actions to recover penalties imposed
by the national banking act. Missouri River Telegraph Company v.
First National Bank of Sioux City, 74 HI., 217; 1 N. B. C, 401.
22. When a State bank acting under a statute of the State calls in its circulation issued under State laws, and becomes a national bank under the
laws of the United States, and a judgment is recovered in a court of a
State against the national bank upon such outstanding circulation, the
defense of the State statute of limitations having been set up, a Federal
question arises which may give this court jurisdiction in error. Metropolitan National Bank v. Claggett, 141 U.S.,520.
23. The act of Congress of July 12,1882, repealing inconsistent acts and providing that the jurisdiction of suits in which a national bank should be
a party should be the same as if it were a State bank at the same place,
prevents the removal of a cause in which a national bank is a party
from a State to a Federal court on the mere ground that it is a national
bank. Leather Manufacturers9 National Bank v. Cooper, jr., 120 U. S.f
778; 3 N.B.C.,208.
24. Under St. U. S., 1888, chap. 866, sec. 4, providing that in actions against
national banks the Federal courts "shall not have jurisdiction other
than such as they would have in cases between individual citizens of the
same State," an action to compel the directors of a national bank to
declare a dividend may be maintained in a State court. Hiseock v. Lacy
(Sup. )930N. Y. S., 860; 9 Misc. Rep., 578.
REPORT OF THE COMPTROLLER OF THE CURRENCY.
193
JURISDICTIONS: See Actions—Continued.
25. The object of this proviso was to deprive the Unite&States courts of jurisdiction of suits by or against national banking associations in all cases
where banks organized under State laws could not likewise sue or be
sued in such courts. Ib.
26. But the proviso does not affect the right of the receiver of an insolvent
association to sue in a Federal court. Hendee v. Connecticut and P. R.
R. Co., 26 Fed. Bep. 677.
27. Nor would the act of July 12,1882, take from the circuit court jurisdiction
of a suit brought against a director for negligent performance of his
duties; for, as such suits rest upon the requirements of the United States
laws and by-laws made pursuant thereto, it is a case arising under the
laws of the United States. Witters v. Foster. 28 Fed. Rep., 737.
28. An action between a receiver of an insolvent national bank and a depositor
does not present a Federal question under Rev. St., sec. 5242, avoiding
preferences to creditors of such an insolvent bank. Tehan v. First
National Bank et al., 39 Fed,. Rep., 577.
29. A receiver of an insolvent national bank is an officer of the United States
within the meaning of sec. 563, Rev. St., which gives the district courts
jurisdiction of "all suits at common law brought by the United States,
or any officer thereof authorized by law to sue." Stephens v, Bernays,
41 Fed. Rep., 401.
30. The United States district court has jurisdiction of an action at law brought
by the receiver of a national bank to recover an assessment made upon a
stockholder, and the action may be maintained in such event against the
executor of a deceased stockholder. Ib.
31. The State courts have jurisdiction of an action brought by a shareholder
on behalf of himself and other shareholders to recover of the directors of
an insolvent association damages for injuries resulting from their negli- .
gence and misconduct. Brinckerhoff v. Bostwick, 88 N. Y., 52.
32. A State court has no power to make an order directing the receiver of a
national bank who has been appointed by the Comptroller of the Currency to pay a judgment obtained against the bank before the receiver
was appointed. Ocean National Bank v. Carll, 7 Hun., 237.
33. Neither the Comptroller nor the receiver by putting in an appearance to a
suit can subject the United States to the jurisdiction of a court. Case
v. Terrell, 11 Wall., 199.
34. The Federal courts have jurisdiction of suits by receivers of national
banks to collect the assets thereof without regard to the citizenship of
the plaintiff. Fisher v. Yoder, 53 Fed. Rep., 565.
35. A Federal court is not deprived of jurisdiction otherwise vested in it of a
suit against the executors of an estate by the fact that the estate is in
the possession of a State probate cotirt for purposes of administration,
and the Federal coxirt has jurisdiction to adjudge whether a liability
exists, but can not issue execution to enforce the same. Wickham v.
Hull et al., 60 Fed. Rep., 326.
36. A suit against the receiver of a national bank to compel him to pay out of
the funds in his hands as receiver moneys claimed by the complainant
is a suit arising under the laws of the United States, and can be removed
into the Federal court. Hot Springs Independent School District, etc.,
v. First National Bank of Hot Springs, 61 Fed. Rep., 417.
37. The tenth subdivision of sec. 629, Rev. St., which confers upon the circuit
court of the United States jurisdiction of all suits by or against any
national banking association established in the district for which the
court is held, has been repealed by the proviso to sec. 4 of the act of
July 12,1882. National Bank of Jefferson v. Fare et al., 25 Fed. R&p., WO.
38. A Federal court has jurisdiction of an action brought by the receiver of
an insolvent national bank in the name of the bank, to realize its assets,
irrespective of the citizenship of the parties.