Tulsa daily world. [volume] (Tulsa, Indian Territory [Okla.]) 1905-1919, 1910-09-15
OPINION
GETS ATTENTION
GUARANTY FUND PRIMARILY IN
TENDED IOR BENEFIT on
GENERh NJ. DEpOSITOR.

'l''lhl w lNN W uilN.
Guthrie, okla, Sept ll.-Th,
opinion of Justice NJ j. Kane of the
oklahoma supreme court In the Ira
billy ol the guarantee fund respon-
slbllity In the projection of pcrma
ncnt school moneys, rendered yester-
laN Is being given great considcra o.
lion here I'm his opini1n the Judge
relieved the oklahoma dcpusItors'
Iund Of responsibility for the $3.50. b.
poo of the permanent school fund
hat was on deposit In the Columbia
Bank aud Trust Company Of OlSlahu-
ma CITY when that concern failed In
september 1919, with three million
liabilities. Of this amount of school
funds, approximately $4,000 was pro-
.cctcd by bank collateral In the form
If county warrants etc, worth more
Than the amount projected; the re-
naming Sli0,0O0 was protected hy
surety company bonds. aud the suit
decided today makes the surety COM
panles liable for the fun amount
bonded,
''The bank guargnly fund ~ Great
3D., says the opinion of Justice Kane,
under the police power of the state,
promote The public convenience, the
general prosperity, the pubic health,
he public morals. or the public safe
H. II waa Obvious that
large sums Of the public funds would
be deposited In banks haV-
Ing such deposits, payment out Of The
Guaranty fund would place an addi-
lional strain upon II that might ieop-
lrdize the claims of general deposi-
l1rs for whose protection IT was pri-
bnrily Intended 10 obviato this the
legislature upon permitting such pub-
tc funds to be deposited In banks,
|urther provided, In the same section,
system whereby they would be com
lletcly protected against loss wiih-
Tut lmpairng the usefulness Of the
lank guaranty fund as protection
" the general depositor'
Justice Kane's reference 10 the sys-
tm of protection provided for pub
'c funds Is that statute requiring all
hch funds to be protected by coll1t-
rail- such as bonds, etc, or by sure
\ bonds 1T is not reasonable" CON
Inues Justice Kane that. the leglsla-
hre would provide "a system Of pro-
hction amply sufficient 20 protect the
..ormanent school fund against loss
shcrcycr any part OF II might be pro-
~,ctod without regard to the bank
mnranty fund. And II may be- thlt
h addition TO the reasons hereinbe-
bro set out, the legislature intended
.Ihis section requiring collateral or
VncuriW protection for public funds.
- bc prop and not burden To the
nny guaranty fund
h The National Surety Company OF
Jew York is thus made liable for
he fun amount of it's bond of 500
90. which has already been made;
he United States Fidelity ana Guar
.ntv Company df Baltimore Md is
luck for 100000, and the southern
ArcW Company of Muskogcc is liable
br $4,000
The case in question originated be
jore District Judge George w. clark
,f oklahoma County and the lower
courts ruling is reversed and remand
I'd Judge clark held, I'm brief that
the school land funds must he treat
I'd AS deposits and that the guaian-
y fund was liable
The bond Of the Commerce Trust
ronpany Of $4,000. given state
Treasurer Menefco for funds Of the
banking board In the Columbia and
which has already been paid; ana
the bonds securing The oklahoma
county deposits IN the failed bank
aid TO bc 100000 win probably come
under the same ruling Thi. being
rue. the bank guaranty fund prohlS
$500. 600 by the supreme courts de-
'ision.