Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1877-03-26
Savings Banks.
To The Editor Of the Ksn1e5ee Journal.
AUGUSTA SAVINGS BAEK, !
March "a 1877.

been given under much doubt on the part OF that
officer, as to its soundness, and great misgivings
as to whether the Court would sustain it. lntelli-
gent men generally cannot fail to share with him
in those doubts and misgiyings. 1t is understood
that the Attorney General is hostile ia the system
of Savings Banks, and it is not therefore unex-
pected that any doubt he may have as to the true
construction of the statutes in relation to these
Institutions, should be given against them, and
hence the apology in the concluding paragraph in
| his opin ion, was unnecessary.
lam not a lawyer, but in my judgment the
| opinion of the States Attorney is not founded in
| good law, or in good sense. Under the laws reg
ulating Savings Banks, which existed prior to the
act passed by the last Legislature, which took eff
| feet on the 18th inst Savings Banks were allowed
| 10 receive deposits from any individual, without
limit to amount, and invest them in such secur-
| tiles as were specified in those laws. The law Of
the late session abidges the privileges as to de-
poslts and changes in some respects the system oil
| investing th9m. The making OF a deposit in
| Savings Bank under the old or new law, involves
| a contract between the Bank and the depositor,
| the conditions of which are that the money shall
be repaid with such rate of dividends the rules
of the Bank prescribe and the laws Of the State al
| low. The Bank is authorized TO receive the de-
post and invest the same in such securities as are
| specially enumerated in the statutes of the State
| This is the whole extent of the business of a saw
| ings Bank in Maine, and the only transaction in
which it can legally engage.
| The trainers of the new law, and the Lcgisla
| ture which enacted it, seeing that the Savings
| Banks had in possession funds standing in the
l.
| what they would be allowed to receive under the
new system it was proposed TO introduce into the
management Of these insttuttutions, and that the
Banks had ma lie investments in securities which it
was proposed to prohibit in the future, incorpor-
ated the following provision into the law, as it
now stands, and which is embraced in the 42d Sec
ton thereof, viz. "Blt nothing In this act shall
abe construed to affect the legality of investments
Heretofore made, Of transactions heretofore had
cor the payment OF interest at rate not exceeding
| "six per ceEtum on deposits already made, until
'the dividend next following the passage Of this
| "act."
The operations of Savings Banks are limited to
very restricted scale. They simply to re-
| ceive deposits and invest them for the benefit of
depositors. These are the only transactions in
which the Banks can engage. The first branch of
the above qcoted provision of the new law, pro-
tects the Banks in the matter of investments made
before it went into effect, and the subsequent
clause protects depositors in the rights acquired
| by the contract made with the Bank 81 the time
| their deposits were made.
| The States Attorney saws the word. Of the Al
section, transactions heretofore had. ID 10: 70
fer to deposits already in the banks. They may.
be says, perhaps cover ditiisaGs heretofore
made, and anything done and completed" That
is to say, dividend made according to law ten
years since and paid to depostors, may perhaps be
legalized by this expression. 1t is not certain
Dickens Bunsby could not have been mora lGmi-
nous in his views, and if the opinion of the
learned Attorney of the State had been uttered in
the presence of Captain Cutie, it would doubtless
have received the endorsement of that distin-
gushed individual in the expressive phrase
"there's wisdom for you!" II the receiving sf
funds from a depostor and contracting with him
| to return the amount thereof, with lawful diyi-
dends is not transaction" on the part of the
bank, | should be glad to have the law officer OF
the State tell me what it isl Is it not the only
transaction" in which the bank can engage ex
cept the investment of the funds deposited, which
is regulated by special provision of the statute
Under the law which existed prior to the passage
of the act of the last Legislature, person comes
to the August Saw ing Bank on the first day Of
January, 1877, and makes g deposit of $4,000
Will any one pretend to say that the receiving OF
that amount and the agreement to pay the rate OF
dividends provided by the rules of the bank and
the laws Of the State, is not TRANSACTION" on
the part of the bank, within the meaning of the
provision of the 42d section of the he new law
which have quoted, and under that pi DIVISION ex.
empted from the operation of the act? II any
body viii so maintain, his legal acumen may be
vastly beyond the comprehension of ordinary le
gal talent and altogether beyond the under
standing of the average common sense of mortal
man. The truth is, the new law in respect to de
posits is prospective, and not retroactve the ex
emption Of the 42d section was intended for tn,
express purpose of protecting deposits already i,
the savings banks at the time the new law tool
effect. Such provision was perhaps unneces
sary, because the law as construed by the Attor
ney General, would violate the obligations o
contracts, and hence be unconstitutional and of ne
binding force whatever.
Many persons will suppose that the promulga
ton OF this opinion Of the Attorney General set
ties 'the law Of the case" This is not so. In til,
determ inaton of the matter, his opinion is of n,
more consequence than that of any other either
Of equal learning and knowledge. In my judg
ment, his opinion is entirely erroneous and no
worth fig, and so believe the Court will de
clare. Its PRONUNCIATION will only have the effec
TO unsettle the minds of depos itors disturb thu
business of the banks, and lessen the receipts o
the State treasury.
write without authority from the Trustees o
the bank represent, but my opinion is that the,
will repudiate the views of the Attorney General
and direct me to pay dividends on the fu amour
of deposits standing in the name of any one per
son previous to the time when the new law tool
effect, until enjoined by the Court.
| VIM. r. SMITH, Treasurer.