The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1844-03-04
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90 Noves. Trustees. bearing date hsrssith'
Our opinion has been requested upon the above ques-
the referred There be doubt
that independent Of the act OF May a. 1870 the notes
legal, and may lawfully be negotiated The general
banking law restriction upon the making and
using such paper although pay be upon ume OF the
the circulating medium which il authorized to be is
sued and for this end required del os OF securities
with the comptroller and that the circulating notes them
selves which were intended be money, should
be pay able demand LAWS 1885 DAG, 3) upon DONG
which, in the language OF the section, they might loan
and circulate the money, according TO the oci
OF banking business as by the law"
and usages of this state This section therefore related
exclusively the circulating notes and not to other
the evidences of debt securities which the asoca
tons at liberty create Neither this section OF the
general banking law OF the others having refer
to the circulating notes, have any thing Il do with
an ordinary promissory note or bill OF exchange nor 90
they impose any restraint whatever upon the
in respect to the OF the ordinary mercantile paper OF
the country among which bills and notes are the most
| common.
1t is supposed. however that the 4th section OF the
act Of May as has more extended applteaon
using any ordinary bill of exchange promissory note
OF ITS own in the usual course Of its business unless
the is payable demand and without interest
That section follows mo banking association,
individual banker SUCH shall issue put in circu
lation bill note of said association ndiv idual
banker the shall be made pay able demand
and without interest," and every violation Of this section
by any oicer or member OF banking association or by
| an individual banker shall be deemed and adJudged
misdemeanor punishable by fine imprisonment both
in the discretion of the Court having cognzance thereof
Qaws, lSiU, 306, In opinion, this section
does apply to ordinary hills and notes ntendedto
be- and not, in fact issued circulated money such
instruments not opinion, either within the in
enon Of the Legislature the language Of the sec
ton in question. Our reasons for this conclusion
The general banking law did not impose any penalty
although the such paper by the ssociations
circulate as money was against the spirit Of the act and
practised and although public grievance
of ordinary magnitude there present means Of
preventing it or OF furnishing those concerned in IT, Cir
culating notes like those countersgned by the Comp
trolle and resembling them in almost particular
were issued by many Of the and the ignorant
and unwary easily imposed upon by Of them
These notes were generally on time and sometimes car
red small interest and for none Of them hsd the public
any security other than the association ITSELF had
been furnished to the Comptroller, in compliance with
the spirit Of the general banking law twas to correct
nuing practising it, that the section under consdera.
ton was passed.
This and this alone was the mischief that existed, and
| which the Legislature intended to remedy
II correct in this view of the necessity which
doubt the construction Of the section ITSELF for al
though the words loose and general they are to no
restrained and limited by this necessity and by the inten
ton of the legislature deduced from the evil they de-
signed and punish and the language they have
Ii Is principle well settled in the construction of
and especially those Of penal nature that they
never to be extended by ntendment to cases not
plainly within the mischief sought to be remedied-(2
Dwar Statutes, 1919 Now cannot be supposed tina,
the Legislature, having eye to the original object OF
passing the general banking law the security of the pub
tic as 10 its circulating medium, and the abuse which ex
listed under the system could have intended to pre-
the associations from giving bonds bills and
for the ordinary purposes OF trade and commerce. payable
- time and not issued intended to circulate money
OF the object OF the act originally psss-
ed to regulate these matters they were left to the udg
men and prudence OF dealers in them, in the man
y ner transactions between indvid uals. There was
with equal certainty, no evil in this respect demanding
~ remedy.
In the first place them we regard the notes question
being within the intention and spirit OF the fourth
section, and therefore not within the section itself This
alone Is sufficient to exempt them from the restraints OF
- its provisions In the words OF Mr. Dwarris much ap
proved authority upon the subject ITO bring case with
in the statute it should not only be within the mischie
contemplated by the legislature but also be within ths
. plain, Ineligible import of the words Of the act" &
1t is to be observed that unless this be the correct
" interpretation, part, and very important as well a'
q Citations. be conducted at all They could not
purchase and endorse bill of exchange payable upon
time, the endorsement being in effect bill &c
them, and consequently in this view Of the Illegal
Nor could they having balance or an account witt
m pay able ION Demand requsiton which would be nm
CT usual as well as absurd and and ou,
to destroy this kind Of business altogether or rem
~ The transmission of funds by this method and other
analogous is very common and forms a valuable as wei
highly useful service to the public SO, too the
sociatons could give their note for site for bank
ing house or for materials to erect one or for an
~ salary officer unless il able demand
nv without interest II is confidently believed that thes
views alone must satisfy all that the section in ques,o
80 not intended to- and does not. interfere with tn
" rights OF the associations to draw bills OF exchange
lpromissory notes, and other contracts in the ord
no | nary mode
~ In the next place of opinion that such notes
not within the plain, ineligible import OF the words
the 4th section OF the act. On examining that act, 1t wi
be that i, relates almost exclusively TO the notes
90 caton' intended to circulate as money the Leg
ature still keeping view and intending to promote III
original object OF The general banking law and the saet
~ Of the puba against worthless currency The origins
allowed the stocks Of Of the states to be receive
W. 10y the Comptroller security for circulating notes. h
iorbs IT, and confines him to the stocks Of this Stat
The third section requires securities TO the amount oi OF
hundred thousand dollars to be deposited with the
troller before the business Of banking shall be
ced the fifth authorizes the return Of mutilsed circu
Is. ting the Comptroller andithe issue Of
aI | to equivalent amount
The seventh eighth, ninth andenh also relate N
circulating notes. and TO the securities provided for tibet
the hands OF the Comptroller and the residue Of the
extends the power of the bank commissioners to the
cations and imposes penalties upon them for refusing
submit TO their examinations II cannot be doubted there
H. lore from its frame and language, that this amended &C
e passed with single eye TO the circulating notes an
not intended TO interfere with the ordinary operation
Of the associations in the OF commercial paper IN
cr the just inference words Of the section
NO They that mo banking association or individual bank
er, SUCH shall ISSUE put in circulation any bill
nj note" &c.
oo This language In only applicable to circulating med
like bank other currency Intended as sui
on sttute money of such speak ms an issue or
but this form of expression rarely II ever
applied 10 bills of exchange and promissory notes hovin
no resemblance to bank and not intended to
~ money No well instructed merchant. or business ma
of any kind ever speaks Of his outstanding notes or bill
Jus as an issue or rs being in circulation The Legislator
EN- must be deemed to have used well and fam
liar terms in their acceptaton "a Dwar 702) an
he N This sense the should be read follows IN
IL. otinn riu1ixi
ing onA''s , i rrrnla,ion Nc money snv hill or note
Jus &c this because the intent to prohibit their circu
l. ton as money and not otherwise, clearly nerrib
from the mischief sought to be corrected. and from til
provisions Of tho act itself indeed, this is in several
ira. stances the VI .,e se,ie. oxs Jaw ,
ing With the act ITO loan and crculaer their notes IA