Iowa territorial gazette and advertiser. [volume] (Burlington, Iowa Territory [Iowa]) 1840-1846, 1843-01-28

stock" The testimony states that Uth4
stock subscribed was never paid in INV
other manner than by the stockholders Civ :
ing ,htr notes to the ins,i.ntion.n Here
then WIS ~ Violation and consequently n
forfeiture ut the charter by the bank in ils
hrs, attempt 70 DO business in its corporate
capacity, because j. proceeded illcsa!Iv.
aud directly contrary 10 tho provisions Of
the ACT which gave i. existence. The design
Of such 81 provision was doubtless TO secure
the public ag;,i.ls, loss or imposition from the
issues Of said bank. The public would ma.
turaily hook 10 the law 10 ascertain m.
terms OF The charter and the security they
would have iii receiving the notes Of ,h,
bank. They wohld find ,ha, The law si.
Pnlattd for forty thousand dollars, sin ,he
legal coin Of I'll. United ssatc..,, as ,hs
basis Of the first issue. Relying upon The
security Inns provided for by the law. and
not suspec,ins tina, the bank wouIL No,
otherwise than in good faith ,oward, tho
public and Instruct compliance with the re-.
QUESTIONS o! its charter the community r.no..
ally were induced 10 receive lis notes onl
10 give currency and crcai. 10 the .amc.-
| What amount was actually paid in, yuur
committee have not been able 10 ascertain
| but are inclined to believe that il was
small compared with the amount stipulated
Tor i'll The act granting The charter. This
SUN, however, be il great or snall. does no,
ana cannot alter or affect the Illegal pro.
CceOius of the Bank. TO common 70 hu,i.
ness upon any amount less than that speci.
he'd IN the charter, was violation and n
| forfeiture OF t'las chatter, and n fraud upon
| the Puoiic. II il was legal to commence
operation before the full amour, provided
IL, h.,J Eun rrca
equally legal TO have com ncncea operations
before the frs, cent Of i.s capital had been
counted. aud il The bank designed to COM
nit {, fraud upon The pubic. i. nigh, have
b,s.ti tina. fraud nnon capital Of ,hrco
coats with til. sane legality as up,na ca.
uilaI OF three ,hpnsan! dollars. The re-
s.,l, would have been the same in law, the
same 10 the public, and, from all yenr COM
n.i.tee can learn quite the same 10 tho
bank Your cosnini,,rc would further add,
,hal ,hey have not been able 10 ascertain
,h,t ANY stock paid INTO the bank
otherwise chan by the individual notes nf
the stuc!,h"l itrs-anl they have therefore
come 10 he conclusion III IT il l. most pro.
bahIc that no. one cen. of the CAPT al s,nok
has over been paid in '.in the legal cola Of
the United S;atcs.'' Thi. being The case,
i, is not only clear that the charter was
violated, bu, l',at it was most wanionly
violated, and II base fraud perpe,rated upon
public conGdenc. which should meet, as il
meri,s. the most swift Il id effective correc.
ton.
Cd. Your committee also deem that tho
charter u! saif bank was violated aud forfeit.
cd BIZ the election ofihdividuais, as directors,
Who owned no stock iii the bank The 9th
section 81 the law confirming the charter
sa,s. ssiie Directors &!oN al he stochholaersin
Mis institaiion The testimony OF Mr.. Davis
shows that he (Mr. Dayis) was elected a d.
rector In that instinuun--and that ito quall-
tv '.in 10 nc, he was handed certificate OF
GAP Tor stock paid in while in tact he did not
own u cent OF stock. and intended 10 return
The certificate whom he ceased to act rs ai-
= ctur." And further that Messrs. Farley,
Waples, Qmgley aud Wailard were qualified
ana made directors IN the same manner that
he had benz tn-wit: hy Saving handed them
encii cert iii ate of stock, Mhlie III reality
neither Of hem owned cent IN the lnstitu-
ton. In the opinion Ut vonr committee this
mode OF . ,ualitNlngn individuals as directors
in an institution IN which they own no stock
Is coa;raiA u the si,ls.t Ut the law granting
the ciartcr--a gross evasion o! us provisions
AUD reckless abase ct IFS privileges,
winch ought to be met not only with the sc.
varest p4hic apprehension but with an l.nme.
d,atr aud absolute repeat ot the authority un.
der whose abused provisions tnis dishonest
praci.ce has been 50 irsquen.lv committed
The law c"ntcmpla,es bona .tide ownership
ol si"ck IN the Institution 10 quAitiy an indi-
vIGua 10 become n director. The testimony
shows tina, at least five If the directors ara
not owners OF any stock in the Institution,
and that the certificates which they hold but
do not 0m,l, were HANDED them merely TO quail
lily th-m for thu time being, aud this, ton, it
would. see III. Will, the implied understanding
that they should return these certificates TO
tue sank when they csnsed to act III the capa-
city OF directors. Your committee deubt
whether even lhe technicaiiiics OF a court Of
law would tolerate this evident evasion OF the
provisions OF the charter-bGs be this as il
may. confident your committee are. that the
pubic judgment would revolt at such an un-
scruPuious abuse OF incorporated pOweI and
30 reckless a Disregard nf the public int crest.
I'D The third and greatest dclinqusNcy OF
the bank, aud which, III itself, in the opinion
Of Your committee, works absolute for.
fixture otIts charter IN ITS entire suspension OF
sJtcie Ia m Dts The latter partoitie lOtn Sec
ton OF the charer provides that oiis Or notes,
tswillch may be issued by order vt said cor
separation, promising the payment 10 any per-
s.son or pcfSons, his, her or ;heif order, or to
.sbearer. though not under the seal OF the
..said corpora;lon, snail be binding aud 0bli-
t.patorv uppn the same, in like manner, and
..w.,h like torcc and effect, as upon any pri.
.!vate person or persons, II issued by him, her
'.or them, IN his, her or their private or natu-
seal capacity or capac,ies, and shall no as
's.gnable and negotiable in like manner. as
sri liiey issued by such private person or
-. rSous; and all such nils, obligatory and Of
.,.Ye,i, and sneA nils, mites md postnotes issued
'.es ej,,rcsaid, stall be pal By Ge sad coriora-
tim. mheu demuudea at Me,f clearinghouse,
'.in tie ls:sal coin Of tie dated States" Inc
Testimony OF oi the witnesses showss
ml,ai is already matter OF publ'c notorlrty,
tina, the said Bank suspended Specie pay
,ncn,s aoont the las; oi March, l34l, anu 70.
manned IN state OF suspension tor q "er'ou
OF fifteen months. at the end OF which time
(ab,n. Is, July 1879 u resumed and con-
t,nurd specie payments Tor one or two weeks,
when i, again sn- pended, and mas remained
SUSPENDED troii. that ti;Ie up to the presents
period Of seve.. months. t'ius tor the TWEEN.
" third moth pas, excepting one or TWO
weeks. the said bank has uu,toimiy refused
IL pay specie, according 10 the terms oil lts.
charter, upon all such Il ITS notes as have
been presented at ITS cOunter-tItrtby NOT
only violating its cnartcr, but lnt)lcnny
deep Injury upon the holders OF its bills wao
are compelled unayoidably 10 bear whatever
ruinoas discount must ensue upon said oils
being d. s.,ono.ed by The bank itself. The
last s=ciion OF the charter (23) provides, s'thae
II said corporation shall Ian to 80 lsitu opera.