The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1909-12-28
Presents Logic and Analysis of
Case to Back Assertion.
STATUS OF THE CASE.
Will Rest as 1t Is Now Until
Appeal Passed Upon.
State Banks Hold Guaranty
Certificate i'm Meantime.

friendly to the bank guaranty law,
while in Topeka today expressed him
self in emphatic and interesting fash
ion regarding Judge Pollock's recent
decision. According to this attorney,
the judgment of the federal court in
this guaranty case is an infringement
on state rights. He argues like this:
IF the federal government contin-
ues to grant powers to corporations
and recognizes these corporations and
controls them, why should this gov
eminent, through its courts. seek to
prevent state from exercising the
same rights and powers in regard to
the corporations that the state Gre
ates? Both the federal government
and the state government create cor
porations and surely both should have
the right to control their own crea-
lures. The state of Kansas grants
charters to state banks and If the
state undertakes to restrict these
banks either by forcing them to guar
antee their deposits or by regulating
the rate of interest they shall pay on
these deposits, surely this is the
states sovereignty The federal gov
eminent controls the national bank
corporations to which it has given
charters. The federal government
decreed by a regulation imposed last
summer by Attorney General Wicker
sham that the national banks could
not enter the state guaranty associa-
ton of Kansas. Now the federal
courts decree that the state banks
shall not be allowed to enter the state
association for the reason that it
gives them an advantage over the ma
tional banks. and is therefore a viola
ton of the fourteenth amendment to
the constitution.
Now this fourteenth amendment
provides that no state shall make a
law which does not give equal pro-
lection under the law to all citizens
within the borders of that state. The
Kansas guaranty law does not violate
this amendment. 1t was designed for
the national as we'll as the state
banks and it's provisions were care
fully drawn with a view to give equal
protection to both classes of banks.
yet the federal government de-
cided that it's corporations could not
, take advantage of this state guaranty
plan. The federal authorities, there
FORE have the power to control their
own corporations and the federal
courts undertake to control the state
in it's control of its own corporations
II this is not blow at state sover--
eighty it produces the same effects
and therefore comes to the same
thing.
jefferson Randolph and Hamilton.
THE trainers of the United States
constitution did not intend the federal
government should be allowed to
granted that right to the states. When
the matter of organizing national
banks came up for discussion in con-
gress. Jefferson, who was president at
that time. and Randolph, his attorney
general, opposed the plan to give that
power to the federal government, but
Hamilton got around the constitution
by getting congress to create an
agency to provide for an exigency to
fit a certain possible cause, ETC., and
by this evasion the power was Sc
cured.
Nov the federal government as
sumes to greater powers over its cor
porations, secured by evasion of the
constitution, than the states shalt have
over their corporations when the
states were given their powers direct
by the constitution.
THE Kansas guaranty law is not
compulsory like those of Nebraska
and Oklahoma. and it's provisions in
cluded the national as well as the
state banks to its benefits
eff the guaranty law is killed in the
United States supreme court we will
see the spectacle of national banks in
Kansas guaranteeing their deposits by
a private insurance company and the
state banks without any guarantee at
all. Yet Judge Pollock annulIed the
guaranty law for the reason that its
enforcement was discrimination
against national banks and placed
them at a fatal disadvantage in COM
will have been placed on the other
foot with a vengeance.
This Pollock decision against state
rights may be more far reaching in
its effects than any court decision in
the west in many years. The case is
sure to be carried to the United States
supreme court in the end and the de-
cision reached there will have an i'm
question of our union of the states
and the relative powers of state and
nation as applies each to the control
OF their own creatures
The question of what the 400 state
banks now in the guaranty association
shall do in the premises is the most
important in connection with the pres
at this time. The attorneys for the
state declare that Pollocks decision
leaves the case in statu quo until
the United States supreme court has
passed on the question of the consti-
tutionality of the guaranty law. This
would mean that the case rests just
where it is at present. No new guar
anty certificates can be issued by the
bank commissioner, but the certifi-
Gates already issued can not be re-
voked until the court of last resort
has passed on the law.
Hutchinson Bank Only.
In his decision Judge Pollock order
ed the state treasurer to pay back to
the Exchange bank of Hutchinson its
guaranty fund, and he ordered the
bank commissioner to recall his GER
tificate sent to this bank. These in
structions were plain and specific. but
they applied particularly only to the
Exchange State bank of Hutchinson
and none other. In the case of The
Assaria State bank and others. Judge
Pollock dismissed this suit. Had he
granted the prayer of this group of
state banks then the state banks al
ready in the guaranty fund would
probably have had to withdraw. But
he did nothing of the sort. He did
grant the petition of the Abilene Ma
flonal bank and others, and in this
case his decision attacked the validity
of the guaranty law.
srsr-a ettorra.-. for the state have de-