Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1874-11-29
THE FRBEDMAN'S BANK.
Full Text Of Chancellor COOper's De-
cree.
Our Courts Have Ample Power to Sci
that Justice Is Done.
A CLEAN Of Hope for the Deluded
DepOsitOrs.

n UACdH VI nOpC AOA thC DCAuuC'
DepOsit0rs.
B. j. Hadley vs.. Freedman's Savings am
Trust Company and others; Charles Pugsle
and Others vs.. Same.
The first of these bills is filed by a de
positor of the Freedmaf's Savings anC
Trust Company to attach certain rents o
} realty in the hands of the company's agents
who are made eo-defendants. Attachment
was ordered, issued, and levied. The othel
bill is filed by similar depOsitors asking for
like attachment. The Savings Company
have fled what is called a plea, answers
and demurTers to the bill; the plea being
in effect that previous to the filing of the
bill, and in July, 1874, under the act OF
Congress of the 10th of June, 1874, the
entire assets of the Freedman's Savings and
Trust Company had been assigned and
turned over to three commissioners, man,
ing them, who had been chosen and quail
fed in accordance with said act, and ac-
cepted the trust, and assumed the manage
ment of its affairs. The answer denies all
fraud, and admits that the company owns
| IN this city unencumbered real estate which
cost S27, 900, which is yielding a monthly
rental, and holds notes secured by mort
| gage on real estate in this county to the
amount Of $1,000. The demurrer is to the
allegations of the bill upon which the
prayer for attachment is based, upon the
ground that they are insufficient to sustain
the attachment.
In tins state of the pleadings, the parties
have agreed, in writing, to submit to the
court the question whether the complain
ants can, by the aid of this court,
reach the properly of the company
in this State, and appropriate it to the pay
ment of their deposits. And in order to
enable the court to decide the point sub
mitted they agree upon the following state
ment of facts:
l. The plaintiff in the original bill is a
depOsitOr as alleged by him, and payment
of his deposits has not been made, although
demanded. He made his deposit with the
agreement that it should be paid him on
demand.
2. The Bank (meaning the Savings Com
pany) has become hopelessly insolvent, and
creditors can only hope for a per cent. of
their claims.
3. Prior to the commencement of this
suit, all the assets Of the Bank were as
signed to Commissioners, appointed under
an act Of Congress, and the trust had been
accepted.
4. 1t is the purpose of these Commits
siOners to sell all the property of the Bank
in the State of Tennessee, and to remove
all the proceeds of the sale, together with
all the money due the Bank, to Washing
ton City, and then to make distribution
thereof pro rata among all depOsitors.
5. The Bank has now in the hands of
said assignees large amount of unincum-
bered property in this State.
6. The charter or act Incorporating the
Freedman's Savings and Trust Company is
made part of this agreement,
By an act Of Congress passed on the Sd
of March, 1865, certain persons named, and
their successors, were constituted
body corporate in the city Of Washington,
in the District of Columbia, by the name
of the Freedmans' Savings and Trust Com
pany. The general business and object Of
the company, was, by the fifth section, de-
elared to be TO receive on deposit such sums
of money as may, from time TO time, be Of
fered therefor, by or ON behalf of persons
heretofore held in slavery in the United
States, or their descendants, and investing
the same in State bonds, Treasury notes, or
other securities of the United States. I'm
der this charter the principal institution
seems to have organized and gone into OPP
Grafton at Washington, and established
branches i'm various States, and, among
Others, in this State. The branch
at Nashville, the answer and agreed state
of facts show, invested at least $4,000 of
its funds in real estate, contrary to the ex-
press requirement of the fifth section of
the charter as above quoted. The mort
gage securities, taken and held as admitted
by the answers. were also without authOri
ty, unless taken since TIE amendment to
the charter by act Of Congress of the 10th
of June, 1874. This amendment seems to
have been passed with the double object,
first, of modifying the mode of conducting
the business of the branches; and, second,
of enabling the corporation to wind up its
affairs, if advisable. BY the It'll section it
isFrOvided, that whenever deemed advisable
by the Trustees to close up its entire busi-
ness, they shall select three competent men,
not connected with the previous manage
ment Of the institution. and approved by
the Secretary Of the Treasury, to be known
and styled Commissioners, whose duty il
shall be 10 take charge of all the property
and effects of said Freedman's Savings
and Trust Company, close up the principal
and subordinate branches, collect from
the branches all the deposits they have on
hand, and proved to collect all sums due
said company, and dispose OF all the prop
erty owned by said company, as speedily as
the interests of the corporation requires,
aud to distribute the proceeds among the
creditors pro rata, according to their re-
spective amounts. After providing for the
Commissioners giving bond with good
security before acting, this section adds:
sAnd whenever said Trustees shall file with
the Secretary of the Treasury a certified |
copy of the order appointing said Commits
siOners, and they shall have executed bonds |
and taken the Oaths aforesaid, then said |
Commissioners shall be invested with the |
legal title to all of said property of said |
company for the purposes of this act, and |
shall have full power and authority to sell |
the same, and make deeds of conveyance to |
any and all of the real estate sold by them |
to the purchasers" The agreement of the /
parties is loosely wOrded, but, presume, it |
comedies that the Commissioners have /
been appointed and qualified under this
section, and that they are invested with the
legal title to all the property of the COM
pany, so far as the act Of Congress can in
vest them with such title. The agreement
says that prior TO the commencement of
the original suit, "all the assets of the Bank
were assigned TO Commissioners appointed
under the act Of Congress, and the trust
had been accepted" presume that the
assignment here spoken OF, is the assign
ment of the act of Congress itself, and not
any formal assignment by the Company.
The original act of Congress incorpora-
ting the Freedman's Bank and Trust Com
pany, constitutes it a corporation sin the
District of Columbia" 1t does not under
take to create a corporation for the Union,
and it, therefore, becomes unnecessary to
consider whether Congress has the consti-
power to charter a corporation in
its capacity rs the legislative body of the
United States. There can be no doubt of
its power to create local corporations for
the District of Columbia
In that view, the corporation thus created
might we'll do business, under the comfy
of nations, in any State in the Union III
which the business was in other respects
lawful. The OstenSible object of the cor
poratiOn was eminently laudable, and no
reason occurs why the business conducted
by it, within the purview of the charter,
was not legal and proper. Nothing, there
fore, stands in the way of any court having
jurisdiction taking coCHizance of the con-
Al