Evening star. [volume] (Washington, D.C.) 1854-1972, 1867-12-26
Letter from Hon. III. X. Hurlburd, Conn.
trolleT.

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Ter q TIE Currency, WAsBINGroN, October ,,
le61.-Dear Sir an IN receipt Of your lette:
OF the 3Uth uitlmo, IA which you I'M uire, els
the receiving of pagcels conts ming unknowa
values, without charge, as generally practised
by the banks, authorized or permitted oy Sec
ton S, and II 80, are the Stockholders respoa-
sible for their safety ~
To this Inquiry reply that National Banks
are incorporated associations, dong business
under law of the United States, with certain
specified and limited powers. Section or the
wherein the National Banking Associauons
are authorized to "exerctse under this act all
such incidental powers as shall be necessary
TO carry on the business OF banking by dis
counting and negotiating promlssory notes,
drafts, bills OF exchange, and other evidences
Of debt; by receiving deposits; by buying aud
selling exchange, coin, and oullisn; by loan
ing money on personal security by Obtaining,
issuing, and circulating notes according 70 the
provisions OF this act
National Bank may exercise any or all Of
these privileges but nothing more may be
claimed thai a bank may receive PACKAGES of
valuable securities, plate or other things, for
safe Keeping under The power granted 70 re.
has definite, well ascertained meaning as es-
tablished by custom, and auth ucated by
judicial decisions, and is limited in the sense
in which 1t is used here TO deposits or money
payable on demand. Ii IL means anything
more than tins, II may include anything or
everything. lit would include silver plate,
ltmIEnt INCLUDE cotton or tobacco, which would
be absurd. The practice TO which you refer
cannot, then, be sanctioned by this particular
power granted
But can II be sanctioned by the authority con-
ferred 70 exercise such incidental power as
shall be necessary TO carry on the business OF
banking, &c.l i think MT. The custody of
valuabies may be convenience to tue Direct
ors. Stockholders, and customers of q Banh.
but IL Is not in the slightest degree g necessary
incident to the business OF BANKING. Bat there
Is direct Limitation 10 the scope Of these Incl
dental powers, In the language Immediately
following the grant, incidental powers neces-
sary to carry on the business of banking by
oiscounting proniissory notes, &c. Is the power
toassume the custody and SAFE keeping OF mis-
cellaneous valuables necessary 70 the discount
OF promissory notes, drafts, bills OF exchange.
DC; is necessary in order TO do any portion OF
BANKING business. Evidently not. The prac-
tice, then. not being authorized by law, is pro-
hibited. The enumeration OF powers con-
ierred includes the power TO loan money on
personal security" Nothing is said about
loaning money on real estate, nevertheless il is
inst as directly prohibited as though ii hal
been done ia so many words. The rule then,
is that bank can exercise only such powers
as are expressly granted, anc that DO wer not
granted is specifically prohibited. In this view
OF the case, have no hesitation ip saying
that. in my judgment, IL Is a direct trans
gression OF the provisions of the National
Currency Act for National Bank TO
assume the custody and safe-keep-
ing Of miscellaneous vaiuables. II
is dangerous to the bank. and N the nature
OF fraud upon the stockholders. If the val
uables are lost through the carelessness or dis
bonesty Oh a Ddnk or CLERK, The Officers
are undoubtedly liable: and IN the practice has
been sanctioned by the board OF directors, they
Will be held liable; and as they are the agents
ofthe stockholders In managing the afairs of
the bank. do not question but that the stock
holders would IN the end be req uired TO make
good the resulting loss
L think the custom n very hazardous one,
and shall do all in nay power 10 discourage II;
ano, under certain circumstances, might be
compelled to proceed against a bank for q VIC
iation Of It's charter. course which 4 hope
may be avoided by voluntary action on the
part of the banks
Very respectfully yours,
H. K. HULBUED, Comptroller.
j. ). NORRIS, Esq. Cashier First National
Bank, Baltimore, Maryland.
The attention OF depositors OF bonds and
other valuable packages respectfully
called TO the above letter from the Comptroller
Of the Currency. Concurrent opinions by
several eminent legal gentlemen have also
been given In conseq uence thereof we do
net feel justified in longer assuming the re-
eponsibility Of the custody OF such articles.
Deposltors are requested TO withdraw such
deposits now in our possession, at their con-
yenience, before the first day of January, IS6-.
W. :. HUNTINGTON,
Cashier First National Bank.