Case ID: wis_122/html/0514-01.html
Source: Caselaw Access Project
Author: {"author": "Winslow, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Bergh, as Commissioner of Banking, Respondent, vs. Security Savings Bank, Respondent, and others, Appellants.
    
      September 9
    
    September 27, 1904.
    
    
      Banlcs: Insolvency;; Winding-up action, by whom to be brought: Substitution of parties.
    
    Ch. 234, Laws of 1903, does not authorize the commissioner of hanking to bring an action to sequestrate the property and wind up the affairs of a state bank; and such an action having been brought by him, the application of creditors of the bank to be substituted as plaintiffs should have been granted.
    Appeal from an order of tke circuit court for Ashland county: John K'. Parish, Circuit Judge.
    
      Reversed.
    
    Por the appellants there was a brief by Sanborn, Lamo-reux & Pray, and oral argument by A. T. Pray.
    
    Por the respondents there was a brief by the Attorney General for the plaintiff, and Richard Sleight and Edward Foster for the receiver, and the cause was argued orally by Mr. Sleight.
    
   Winslow, J.

This is an appeal from an order refusing to grant the motion of the appellants, Lolvman and others, to be substituted as plaintiffs in the action for the plaintiff Bergh. The action is one in equity to sequestrate the property of a state bank and wind up its affairs. It appears by the complaint that the directors of the bank placed the same in the hands of the commissioner of banking February 13, 1904, and that the commissioner on the following day commenced this action against the bank alone, and a receiver was appointed. Three days thereafter, the appellants, Lohman and others, upon verified petition showing that , they were creditors of the bank in large amounts, and that the same was insolvent, and that the officers and stockholders had been guilty •of mismanagement in various ways, moved that they be sub■stituted as plaintiffs for the commissioner of banking, and they appeal from an order denying the motion.

It is clear to onr minds that the motion' should have been granted. It was denied, apparently, on the ground that by •ch. 234, Laws of 1903, the commissioner of banking was endowed with power to bring such actions in his own name. 'There is no foundation for this claim. There is no word or -sentence in the entire chapter conferring any such right, in terms, nor can such an intention be inferred therefrom. On the other hand, the statutes regulating the procedure in actions of this nature (viz., secs. 3218, 3219, et seq., Stats. 1898) remain untouched by said ch. 234. Sec. 3219 provides, in express terms, that the action may be brought by the .-attorney general in the name of the state, or by any creditor •or stockholder of such corporation. Why it should be supposed that the commissioner of banking is added to the list ■of plaintiffs by ch. 234 we are at a loss to understand. Having actually brought the action, the application of the creditors to be substituted for him should at once have been .•granted.

By the Gowrt'. — Order reversed, and action remanded with •direction to grant the motion for substitution.