The Washington union., 1858-01-31
CITY OF WASHINGTON. SUNDAY MORNING JANUARY 81 1858.

declared In the opinion Of the counsel Of the Bank of
Metropolis dated june 25 1874 sent to the committee
by the president OF that association 1t would be difficult
to suppose other motive for the application 10 Con-
gress than the hope that by enstng its sympathes in
favor of the stockholders the plea that unless the
charters renewed there could be Of collect
ing the debts due to the banks they would thus obtain
legislation that would enable them to continue
their business This fact with others strongly illust
ting the bad faith OF these corporations Is orcbly stated
by select committee Of the Hotise of which Mr. Burke
Of New Hampshire, chairman, in very able report
made ON the 25th February 1916. @ it FatN tt
Failing in their efforts to obtain the renewal of their
charters the banks determined to evadc or rather fla
ranty to violate all the conditions imposed upon them
by the act Of 3D. July 1910, adopting the provisions OF
that of 25th MAY 1888 to which reference has been
heretofore made No axiom of law fs better established
moro universally recognised than that no ii or set
of men convey to Others greater power than That
which they themselves possess the delegated power can
exceed the original 1t would be idle 70 quote au
thorty to establish principle rudimenal The mode
Of operation In the of the Bank OF the Metropolis
and the SAME coifse substantially pursued by the
other banks was this the stockholders we're convened
the president and directors were selected MS trustees
They could not execute assignment to themselves, and
Richard Smith, the cashier selected the agent and
conduit through whom the property and effects of the old
to pass to the trustees OF the new institution The
transfer was made to Smith Sd July, 1884, who then
ASSIGNED them to the trustees. Dferrick Trustees
Bank of the Metropolis, Gfl's Reports, page CO.,
1t thus appears that the preAdet ard directors sold
trustees without consideration or If any named 1t
was of course purely fictitious all the assets of their
respective institutions with power to carry on general
banking business without any OF the restrictions md
safeguards for the community under which they had acted
as corporations shameless attempt to evade the
express provisions of law cannot well be imagined and
the committee believe that If the nets Of May rs, 1888,
and Sd july lS40 had been submitted 70 the court ofap
pes Of Maryland in the Of Merrlck U.s. Trustees OF
Bank Of Metropolis the decision would have very d
fercnt In that case decided that the penal sections
Of Sd March, 1877 to which the committee will aude In
connection with the legality of the present issues OF notes
hs these banks Mere repealed that, consequently q
note dscoaited by the bank in tie ordinary course Of
business the proceeds o., Which wold be paid out IN the
bills of the bank not given fof ,s Illegal consdca
tion and therefore not null and void The cott express
N saws in its decision that it considers the penal sections
Of the act OF 1917 have been repealed and that at
the Same time is conceded that there is other action
Of Congress at least none has been referred to- s reach
ing these plaintiffs Your committee 40 not, however
assent to the reasoning Of the court of appeals OF Mary
land in the case above cited The act of I'D March, 1917
entitled An act to incorporate the subscribers to ce
tain banks In the District of Columbia and to prevent
the circulation of the notes of unincorporatcd associa-
tlcs within the said District 1t had two objects one
special the other general The special object to cre
ate certain corporations, investing them with GER
tain privileges and immunities, to be eijoycH IN,
der many salutary restrictions, and to be limited
nj its duration namely, TO lst january, 1922. The
general Uct protect the community against the
issue Of notes for circulation by unauthorized and re
sponsible companies individuals tHh rs the danger
to be guarded against one at all times likely 70 bc
cur-was permanent 1t criminal statute, and in
tended always to be in force until expressly repealed
When the charsts uf the banks about to expire the
act of I'd March, 1921 pasd under the title of AN
act to extend the charters of the banks m the District of
Columbia" The title here indicates the purpose. Tbs
st section provides that the acts incorporating the v
cral banks of the District of Columbia herein named be
and the same are hereby, extended and limited to Sd
March, 1886 under and subject to such limitations mod
orlrp hata tPr
all specially to the banks named the last sec
ton in the opinion of the committee completely rcpudatss
the idea that the act intended to apply to any other
subject than the Incorporated banks 1t declares that
so much and such parts of the said acts incorporating the
several banks aforesaid may be repugnant to this oct
be, and the are hereby, repealed and annulled
The provisions of the act Of 1917 being limited to Janu
ary 1922 it was necessary to extend them if the
istence of the banks to bc continued and, to pre-
proper control them, public policy required
that their duration should be limited The penal sec
tions for all tme did not require renewal, and
consequently neither the renewals limitations can be
considered applying to them. But while the opinion
of the committee is very decided on this question, as
the Judge of the criminal court of the District of Column
bin, from whose judgment, it seems, there is no ap
peal has decided that an Indictment cannot be main
tanned under the act of 1s for the issuing of bank notes.
they think it cxpedient to all doubts the sub
ect by the passage of law for its prohibition The qes
ton to tho legality of the contracts made by the banks
who have heretofore enjoyed the privileges Of ncorpOra
ton one between them and their debtors in which the
public has concern and the committee has dispo
ston to speculate about the probable result of any
ton of that kind that may hereafter be brought before
judicial tribunals That of the currency is of very
different character it affects the interest of every eber
of the community, and Congress is bound, not only
the special guardian of the people of the District of CO.
lumbia, but for the sake of example to the nation at
large to watch, with the most jealous eye everything
that may have tendency to debase It, Were there any
reasonable hope that could return to what the
mtee considers to be the true theory Of the constitution
total prohibition of the circulation of paper money is
sued under the authority Of the several States they would
give such their cordial support Butbclicving
that the time ia yet distant when the national mind will
be prepared for the adoption of purely metallic curren
cy they will make suggestions of general character
but will confne themselves to the subject Immediately
referred to them. g'
The table which is herewith presented shows conclu
svey that the issue of notes by the banks of the District
of Columbia may be Immediately suppressed without any
circulation amounts only to S265 929 assuming that az
least $50 900 Of the notes held by the banks them
selves WHILE if their statements be correct they have in
their vaults 1910, GAG 40 Deductng from this
third of the specie S103548 which is the lowest pro-
portion which safe banking system would require
sound basis of circulation it appears that the difference
between these exhibits the whole amount of active
means which would be withdrawn from the funds
ployed by them in dscountng the paper offered by their
six per cent s 742 So This is the extreme limit of
the annual dminuon of the profits of the stockholders
by the suppression of their circulation but when the
additional expense attending this branch of their busi
is taken into account, it may well be questioned If
any advantage be derived from it. But small as this
calculation would appear from the returns to be- your
committee believe that it is larger than it the