Abilene weekly reflector. [volume] (Abilene, Kan.) 1888-1935, 1909-12-30
rHr BANK duARANTY DE0sION.

from ~ 10 Yz.ID. Nl
THE BANK GUARANTY DECISION.
A decision Of the federal court on
Friday has put the Kansas bank guar
anty deposit law out Of business for
the present and probably permanent
Iy. 1t follows a similar decision tnat
nullIfied the Nebraska law and me
same fate will probably overtake the
Oklahoma law.
Three cases were submitted 70 the
court and have been argued at length
by the state officials for the law and
the plaintiffs against II: One was
brought by Frank s. Larabee. q stock
holder Of the Exchange State BANK
Of Hutchinson. He asked for an IN
junction preventing the bank COM
missioner from enforcing the law as
m 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
treasurer before Larabee brought his
suit. The court holds that the IN
junction should apply in the case ana
that the money deposited by the
bank is not to be used for any pur-
nose except to be refunded to the
bank.
In other words, according to Judge
Pollock's decision in this case, 2 SIN
Gle stakeholder of a state bank may
II he brings proper action, prevent
that bank from entering into the
privileges Of the guaranty law even
though large majority Of the stock
holders had voted the bank into tine
state guaranty association. This de-
cision alone would have seriously
crippled the guaranty law for the
reason that there is hardly a state
hank in Kansas where one stock
holder could not be found who would
oppose the scheme Of guarantee'ns
deposits.
The second case was brought by 9
large number OF state banks the
state banks asked for an Injunction
because they did not want to parti-
cipate in the law and it was asserted
that the fact that other banks parti-
cipating really made the law com,
nulsorv He dismissed the case soi
he state banks. The only way these
banks can get into court is the same
method employed by Larabee Wnel
an injunction will probably be -
sued preventing the operation OF tn'
law and that bank alone.
The third case was brought by a.
/ the national banks Of the state =
nrevent the enforcement Of the law
The national banks commended Una,
the state was discriminating asalns'
them when 1t passed the guaranty
law as the comptroller OF the cur,
rency had held that the nationa
thanks could not participate IN any
state law guarantee bank deposits
In answer to the prayer Judge Pol
lock in his decision granted the IN
junction in the following language
an the case Of the national bank
as the rights Of complainants ma'
nat be protected in any other man
ner save by a broad decree, writ o.
temporary injunction wlll issue a
urayed in the bin. to remain in forc'
nntiI the further order Of this cour'
on the giving and approval by th'
,udge or clerk Of this court OF bono
IN the penal sum Of $4,000, condi
toned as by the laws provided
In the course OF his decision Judg'
Pollock passed on the constitutional
,ty of the guaranty law as follows
In the light of authorities it mus
he held. a legislative enactment tina
, confers special privileges and beneiit'
, on a class which by the law, and no
by conditions are denied to anethel
class, in the same business or calling
and which privileges and benefits 81
conferred on the favored class ma
he and are employed TO Impair and
: destroy the business of those belong
c ing to the excluded class, is inhibited
! By the provisions in the Fourteenth
. amendment to the national constitu
$ ton. And more especially must thi
be true, l thing in case such IS thu
E where the business condueteS in IL
E same city. town or locality and n
9 competition. one class with tn
2 other"
D In his decision granting the intunc
ton against the guaranty law, Judg
: Pollock gives the state a chance 7
( disprove the evidence Of the natiOna
. banks and the agreed statement Q
! facts that was presented to him b
! the lawyers on both sides OF tn