Virginian-pilot. (Norfolk, Va.) 1898-1911, 1899-09-10
COURT c III. ! j DECISIONS! &c
Notes q. Gases Recently Decided,
Which are Of Interest to
s. Our People.
DIGESTED BY W. B,MARTIN.
tExclusively for vIrEinian-P Pilot,

- tN Il Fl y t
FIRST N. BANK v. HAWKINS, ETC.
Supreme Court Of the United STATES.
May 10, 1899.
ONE NATIONAL BANK CANNOT
LAWFULLY PURCHASE AND
HOLD THE STOCK OF ANOTHER
AS AN INVESTMENTS.
IN CASE OF SUCH PURCHASE, TT
is NOT EsToPPnD. TO DENY IT'S
i LIABILITY FOR AN ASSESSMENT
4 ON SAID STOCN MADE BY TIE
COMPTROLLER.
The plaintiff, as receiver Of The In
dianapolis National D;luls, sued for AN
assessment of Sl00 a share ON the stock
OF said Indianapolis Bank, which had
been made by the Comptroller of the
Currency, OIL certain shares Of stock
which the defendant bank had nur-
chased and held as I'M investment. The
defendant claimed 1t MAS not liable for
such assessment. The lower court gave
judgment for the piuintiir, and the de-
PENDANT appealed.
The Court says:
The questions presented for our con-
sideration are whether one National
bank can lawfully acquire and hold
the stock of another as an investment,
and, IL not, whc Their, in the case of such
estopped TO deny It's liability as an ap-
parent STOCKHOLDERS for an assessment
on such stock ordered by the Comptrol-
Ter Of the Currency. In the recent case
OF California Nat. Bank V. Kennedy,
1t was said: at Is clear, however, that
q National bank does not possess the
power TO deal in stocks. The prohibi
ton is implied from the failure to
grant the power" Without pursuing
this branch OF the subject further, we
upon principle and authority, that the
plaintiff In error, as n National banking
association, had no power or authority
to purchase wlthsits surplus funds as
an investment and hold as such shares
of stock in the indianapolis National
Bank of Indianapolis
The remaining question for our deter
mination is whether the First National
Bank Of Concord. having, as matter
of fact. but without authority OF law,
purchased and held as an Investment
shares OF stock in the indianapolis Ma
tional Bank, can protect Itself from n
suit by the receiver Of the latter
brought to enforce the stockholders Ii
ability under an assessment by the
Comptroller of the Currency by alleging
the unlawfulness OF it's own action.
This question has been so recently
answered by decisions OF this court that
1t will be sufficient, for our present pur-
pose, TO cite those decisions without
undertaking to fortify the reasoning
and conclusions therein reached.
(The court here cites n number Of
cases showing that such illegal buy
ing OF stock by a bank Is void, and
continues:
If the previous reasoning be sound.
whereby the conclusion was reached
that, by reason OF the limitations and
provisions of the National banking
statutes, it Is not competent for an as
Eooio finn oru1n iXal Hereunder take
upon itself, for Investment, ownership
OF such stock, no intention can be rea-
sonably imputed to Congress to subject
the stockholders and creditors thereof,
for whose protection those limitations
and provisions were designed. 10 the
same liability by reason OF n void act
on the part of the officers of the bank.
as would have resulted from lawful
act
Reversed.