Evening star., 1935-03-04
D. c. Supreme Tribunal Up.
held on Decision of Con-
troIIer.
ACTION is VICTORY
FOR BANK RECEIVER
1nsolvent North Capitol Savings
Is Held Subject to District
Code.

Robert N. Harper, we'll known for
mer banker, lost court fight against
payment Of a $4,000 stock assessment
in the insolvent North Capitol Saw
tngs Bank today when the Court of
Appeals affirmed a decision of the
Supreme Court of the District uphold
ing the right of the controller of the
currency to levy the assessment, with
out the necessity for a judicial deter
mination of insolvency.
The decision is victory for John F.
Moran, receiver for the bank, and un-
less successfully further appealed and
reversed, will stand as precedent to
authorize the receiver to collect a
total of $4,000 stock assessment
against all 5000 shares in this bank
at $40 share.
Lost First Step.
Harper lost the first step Of his
fight to prevent collection OF the as
sessment when the District Supreme
Court rendered judgment against him.
He then appealed to the higher court.
The appeals court decided the bank
was subject to the District Of Colum-
bia Code, that the controller of the
currency had the right to liquidate the
bank. had determined the institution
was insolvent, and his conclusion was
mot subject to attack or open to re-
view except for fraud"
Harper in his appeal, as explained
in the decision today, had contended
that under the Arizona statute (un-
der which the bank was chartered as
construed by the highest court of that
State, there is no obligation upon a
stockholder to pay anything until the
precise amount he is liable to pay
under the double liability clause of
termined by court Of competent
jurisdiction"
Explaining thai this appeared to
be correct statement of the Ari-
zona law" the Court of Appeals here
said it had been contended by Harper
that the determination. of the con-
troller does not. under Arizona laws.
constitute a judicla. ascertainment of
the extent of insolvency or the pro
rata amount due by appellant"
Turns Upon ID. c. Law.
The answer, according to the Court
of Appeals, turns upon the provi-
sions of the District of Columbia
laws" In establishing its principal
place Of business here, the court said,
the bank contracted with reference
to the laws of the District, and this
is true, as we'll, as to the contracts
of the stockholders between them
selves"
Citing the District Code, which
gives to the controller of the currency
authority over banks in the District of
Columbia, the court said I'VE think
the provision in question is notice to
every banking organization incorpo-
rated under the laws of one of the
States that, in coming into the District
Of Columbia to do business, it submits
itself to the supervision and control,
both in operation and in insolvency, of
the controller to the same extent as
If it were a national bank; and if this
is true, it seems to us to follow that if,
under Federal statutes the determina-
tion Of the controller that an assess
ment is necessary is conclusive, as it is,
the question Is thereby foreclosed not
withstanding a contrary statute or
ruling in the state of incorporation.
Nothing to be Added.
IF we are correct in this, nothing
more need be added, for it has been
definitely determined that when the
controller Of the currency appoints a
receiver for a defaulting or insolvent
national bank he may also call for
ratable assessment upon the stock
holders, without previous judicial
ascertainment of the necessity of the
appointment Of a receiver or of the
existence of the liabilities Of the bank"
The case was heard by Justice Mar
tin, Justice Hitz and Justice Groner.
The receiver was represented by John
Philip Hill and Francis W. Hill, while
Harper was represented by Milton D.
Campbell, William E. Richardson,
Ralph p. Barnard, w. w. MILAN and
E. Hilton Jackson.