Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1877-04-03
81 VINGS BANK LAW.

To Tie Editor of the Rennebec Journal;
have read the "open letter" of w. II. Smith,
Esq, as TO the construction OF the new law regua-
ing Savings Banks. He seems to be very conf
dent in his views, and to think somewhat lightly
Of the opinions of any one who may differ from
him.
Nevertheless, will take the liberty to make
few suggestions that lead me to hesitate about
concurring with him.
1t will not be denied that Savings Banks are
subject to the power of the Legislature. The ex-
perence Of the past ten years shows that that body
not only claims the power, but Is nowise modest
about exercising it, and that at almost every SEES
sion.
MIR. Smith says THE making Of deposit in
Savings Bank, under the old or new law, in
wolves contract between the Bank and the de-
postor, the conditions Of which are that the money
shall be repaid, with such rate of dividend as the
rules Of the Bank prescribe, and the laws of the
State allow" This is sd nitted to be good law
and good sense.
But the Legislature has the power to change
the rate of dividends, and this is understood when
the contract is made. They have already changed
the rate three times, including the present change
The Legislature has also right to afix other
conditions, and prescribe other regulations with
regard TO deposits and dividends. So tar as
know, this is not disputed.
BY the new law, two restrictions are placed on
tue powers Of Savings Banks, in Section 9:-irst
they shall not receive from one depositor, directly
or indirectly over $1,000; second, no interest shall
be paid to any one depostor for any amount Of de-
post: over said sum- except for deposits by widows
etc. These prohibitions are very plain and posi-
tive. They mean what they say, unless there is
some provision in the act to modify them.
Mr.. Smith thinks the last one only applies to de-
posts hereafter received.
The first objection to his construction is that il
does away with the force of the clause altogether
After prohibiting a Bank receiving more than
$1,000 from any depositor, there can be no neces.
SHY oil adding that the Banks shall not pay inter
est on any deposit over that sum, unless the sddi-
tionsl provision applies to deposits not included in
the first prohibition.
But Mr.. Smith urges that the 9th Section is
modified by part Of the 42d Section -"Bu,
nothing in this act shall be construed to affect the
legality OF investments heretofore made, of trans
actions heretofore had" etc.
Ii understand his argument, it is, tina, the
words transactions heretofore had" must apply tc
deposits heretofore received for the reason tina,
Savings Banks can do no other business but re.
ceive deposits and invest them and tina, former
Investments hasing been excepted from the pro
visions Of the act by the preceding clause, thi.
clause must necessarily refer only to deposits al
ready made.
Let me suggest, that another "transaction here
tofore had is the election of officers, as the new
laws limits the selection of trustees in an lmpof
tant particular. This, doubtless, is one Of tn
transactions heretofore Lad" which are not 10 b
affected by the act, until : subsequent elec.io
takes place.
Then let it be admitted that past deposits
more than $1,000, constitute another class
transactions heretofore had" the validity
whish is no, affected by the new law. But does