The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1909-12-24
KNOCKS IT OUT.
Judge Pollock Delivers Blow to
Guaranty Law.
Holds That 1t Is imperative
Today.
GRANTS INJUNCTION.
Holds That Provisions of Law
Can Not Be Enforced.
Two Points Are Covered in the
Decision.

| States circuit court in a decision hand
ed down today granted temporary in
junction preventing J. n. Dolley, state
, bank commissioner, and Mark Tulley,
state treasurer, from enforcing the pro-
visions of the Kansas bank deposit
guaranty law.
| The court provides, however, that
the state may deposit bond of fifty
thousand dollars during the January
term of the court and the question of
a final hearing will be determined. AS
the case stands now Judge Pollock
holds that the guaranty law is invalid.
! If the state can prove that the ma
tional banks that brought the suit are
I wrong in their contentious and that
! the petition filed with the court is not
true the injunction may be dissolved.
! Three Cases Submitted.
! There were three cases submitted to
the court One was brought by Frank
S. Larabee, Stockhoider OF the Elk
. change State bank of Hutchinson He
asked for an injunction preventing the
bank commissioner from enforcing the
law as to that bank This injunction
was granted. The bank directors and
stockholders had voted to participate
in the guaranty law and had paid IN
| the guaranty deposit to the state treas
urer before Larabee brought his suit.
J The court holds that the injunction
should apply in this case and that the
money deposited by the bank is not to
be used for any purpose except TO De
refunded to the bank
In other words, according to Judge
Pollock's decision in this case, single
stOckho1der of a state hank may. II ne
brings proper action, prevent that oank
from entering into the privileges of the
guaranty law, even though large ma
joritv of the stockholders had voted
the bank into the state guaranty asso-
/ citation. This decision alone would
have seriously crippled the guaranty
] law for the reason that there is hardly
| a state bank in Kansas where one
stockholder could not be found who
would oppose the scheme of guaran-
! teeing deposits. In passing on the
| follows:
IA temporary injunction will be is
sued restraining the officials OF the
| Exchange State bank of Hutchinson.
| its officers agents, servants and en-
! ployes from further expenditures by
! the bank in complying with the terms
! of the guaranty act. Also restraining
/ defendant, Mark Tulley as state treas
urer from dispursing the money OF
the bank in his hands to any person
or persons, except in restoring it to
the custody of the bank. And further
restraining Joseph n. Dolley, oank
ing to the officials of the bank any
certificate of authority empowering
the bank to conduct its affairs under
t the provisions of the act.
State Bank Case.
The second case was brought by
large number of state banks. The state
banks asked for an injunction because
they did not want to participate in the
law and it was asserted that the fact
that other banks participating really
made the law compulsory The court
held that the guaranty law was not
compulsory and dismissed the case OF
the state banks. The onlv way these
banks can get into court is the same
method employed by Larabee when an
! Injunction will probably be issued pre-
venting the operation of the law as TO
that bank alone.
! The third case was brought by all of
the national banks of the state to pre-
vent the enforcement of the law. The
i national banks contended that the state
was discriminating against them when
| it passed the guaranty law as the
! mptrOller of the currency had held
| that the national banks could not par
bank deposits The prayer in the petit
| ton of the national banks in the Abb
| lene case was follows:
| Wherefore complainants pray your
honors for the granting of temporary
! injunction enjoining and restraining the
defendants. Joseph N. Dolley, bank
commissioner of the state of Kansas,
| and Mark Tulley, state treasurer of the
state of Kansas from proceeding to act
under or enforce the said law of the
legislature of the state of Kansas, ap-
proved March 6, 1909 and that they be
enjoined and restrained from receiving
deposits of bonds or money as in sec
tion g provided for and from issuing
certificates to any bank or banks, as
| in section 2 provided for, and that they
be further enjoined and restrained from
| enforcing any of the provisions Of the
said act and from attempting to exer-
else any powers or rights under the said
act and restrained and enjoined from
| interfering with the complainants by
reason of said banking act.''
Injunction in Abilene Case.
In answer to the prayer Judge Pol
lock in his decision granted the injunc-
| ton in the following language:
| In the case of the national banks
| as the rights of complainantS may not
| be protected in any other manner save
| by broad decree. writ of temporary
| Injunction will issue as prayed in the
| bill, to remain in force until the further
order of this court on the giving and
| approval by tie judge or clerk of this
court of a bond in the penal sum of
$50, 0,o00 conditioned as by the laws pro-
| vide6.''
In the course of his decision, Judge
| Pollock passed on the constitutionality
| of the guaranty law as follows:
| In the light of authorities it must
4 be held. a legislative enactment that
| confers special privileges and benefits
on class which. by the law, and not
| by conditions are denied to another
| class in the same business or calling,
and which privileges and benefits so
| conferred on the favored class may be
and are employed to impair and de-
stroy the business of those belonging
to the excluded class. is inhibited by the
provisions in the Fourteenth amendment
to the national constitution. And more
| especially must this be true, think