Source: https://m.openjurist.org/263/us/640
Timestamp: 2020-04-10 03:45:13
Document Index: 376262103

Matched Legal Cases: ['§ 5134', '§ 9659', '§ 5190', '§ 9744', '§ 1', '§ 1', '§ 9675', '§ 9695', '§ 21']

263 US 640 First Nat Bank in St Louis v. State of Missouri Barrett | OpenJurist
263 U.S. 640 - First Nat Bank in St Louis v. State of Missouri Barrett
263 US 640 First Nat Bank in St Louis v. State of Missouri Barrett
44 S.Ct. 213
68 L.Ed. 486
FIRST NAT. BANK IN ST. LOUIS
STATE OF MISSOURI, at inf. of BARRETT, Atty. Gen.
[Argument of Counsel from pages 644-652 intentionally omitted]
[Argument of Counsel from pages 652-654 intentionally omitted]
National banks are brought into existence under federal legislation, are instrumentalities of the federal government and are necessarily subject to the paramount authority of the United States. Nevertheless, national banks are subject to the laws of a state in respect of their affairs, unless such laws interfere with the purposes of their creation, tend to impair or destroy their efficiency as federal agencies, or conflict with the paramount law of the United States. National Bank v. Commonwealth, 9 Wall. 353, 362, 19 L. Ed. 701; Davis v. Elmira Savings Bank, 161 U. S. 275, 283, 16 Sup. Ct. 502, 40 L. Ed. 700. These two cases are cited and followed in the later case of McClellan v. Chipman, 164 U. S. 347, 357, 17 Sup. Ct. 85, 87 (41 L. Ed. 461) and the principle which they establish is said to contain a rule and an exception—'the rule being the operation of general state laws upon the dealings and contracts of national banks; the exception being the cessation of the operation of such laws whenever they expressly conflict with the laws of the United States or frustrate the purpose for which the national banks were created, or impair their efficiency to discharge the duties imposed upon them by the law of the United States.' See, also, Waite v. Dowley, 94 U. S. 527, 533, 24 L. Ed. 181. The question is whether the Missouri statute falls within the rule or within the exception.
Does it conflict with the laws of the United States? In our opinion, it does not. The extent of the powers of national banks is to be measured by the terms of the federal statutes relating to such associations, and they can rightfully exercise only such as are expressly granted or such incidental powers as are necessary to carry on the business for which they are established. Bullard v. Bank, 18 Wall. 589, 593, 21 L. Ed. 923; Logan County Bank v. Townsend, 139 U. S. 67, 73, 11 Sup. Ct. 496, 35 L. Ed. 107; California Bank v. Kennedy, 167 U. S. 362. 366, 17 Sup. Ct. 831, 42 L. Ed. 198. Among other things the federal law (R. S. § 5134 [Comp. St. § 9659]) provides that the organization certificate of the association shall specifically state 'the place where its operations of discount and deposit are to be carried on, designating the state, territory, or district, and the particular county and city, town, or village.' By another provision (R. S. § 5190 [Comp. St. § 9744]) it is required that 'the usual business of each national banking association shall be transacted at an office or banking house located in the place specified in its organization certificate.' Strictly, the latter provision, employing, as it does, the article 'an' to qualify words in the singular number, would confine the association to one office or banking house. We are asked, however, to construe it otherwise in view of the rule that 'words importing the singular number may extend and be applied to several persons or things.' R. S. § 1 (Comp. St. § 1). But obviously this rule is not one to be applied except where it is necessary to carry out the evident intent of the statute. See Garrigus v. Board of Commissioners, 39 Ind. 66, 70; Moynahan v. City of New York, 205 N. Y. 181, 186, 98 N. E. 482. Here there is not only nothing in the context or in the subject-matter to require the construction contended for, but other provisions of the national banking laws are persuasively to the contrary. By section 5138, R. S. (Comp. St. § 9675), the minimum amount of capital is fixed in proportion to the population of the place where the bank is located. If it had been intended to allow the establishment by an association of not one bank only, but, in addition, as many branch banks as it saw fit, it is remarkable, to say the least, that there should have been no provision for adjusting the capital to the latter contingency or for determining how or under what circumstances such branch banks might be established or for regulating them. Section 5155, R. S. (Comp. St. § 9695), provides that it shall be lawful for a state bank 'having branches, the capital being joint and assigned to and used by the mother-bank and branches in definite proportions, to become a national banking association * * * and to retain and keep in operation its branches, * * * the amount of the circulation * * * to be regulated by the amount of capital assigned to and used by each.' This provision, confined by its terms, as it is, to existing state institutions, may be fairly considered as constituting an exception to the general rule, and the presence of safeguarding limitations in the excepted case, with their entire absence from the statute otherwise, goes far in the direction of confirming the conclusion that the general rule does not contemplate the establishment of branch banks. This apparently was the interpretation of Congress itself, since in two instances at least special legislation was deemed necessary to allow the establishment of branch banks, viz. at the Chicago Exposition, in 1892 (chapter 71, 27 Stat. 33), and at the St. Louis Exposition, in 1901 (chapter 864, 31 Stat. 1444, § 21); the existence of the branch bank in each instance being expressly limited to the period of two years.
The construction of the executive officers charged with the administration of the law has been, with substantial uniformity, to the same effect, and in this view the Department of Justice, in a well-considered opinion, rendered May 11, 1911, concurred. Lowry National Bank—Establishment of Branches, 29 Op. Atty. Gen. 81.1
It must be admitted that, is so far as the legislation of Congress does not provide otherwise, the general laws of a state have the same application to the ordinary transactions of a national bank—such as incurring and discharging obliagtions to depositors, presenting drafts for acceptance or payment and giving notice of their dishonor, taking pledges for the repayment of money loaned, and receiving or making conveyances of real property that they have to like transactions of others. But not so of questions of corporate power. As explained in Easton v. Iowa and other cases, their solution must turn on the laws of the United States under which the bank is created.
National banks, like other corporations, have such powers as their creator confers on them, expressly or by fair implication, and none other. Thomas v. West Jersey R. R. Co., 101 U. S. 71, 82, 25 L. Ed. 950; Logan County National Bank v. Townsend, 139 U. S. 67, 73, 11 Sup. Ct. 496, 35 L. Ed. 107. Powers not so conferred are in effect denied; a prohibition is implied from the failure to grant them. First National. Bank v. National Exchange Bank, 92 U. S. 122, 128, 23 L. Ed. 679; California National Bank v. Kennedy, 167 U. S. 362, 367, 17 Sup. Ct. 831, 42 L. Ed. 198. In short, all the powers of a national bank, like its right to exist at all, have their source in the laws of the United States. Only where those laws bring state laws into the problem, as by enabling national banks to act as executors, administrators, etc., where that is permitted by state laws, can the latter have any bearing on the question of corporate power—the privileges which the bank may exercise. First National Bank v. Union Trust Co., 244 U. S. 416, 37 Sup. Ct. 734, 61 L. Ed. 1233, L. R. A. 1918C, 283, Ann. Cas. 1918D, 1169.
'Neither can intrude with its judicial process into the domain of the other, except so far as such intrusion may be necessary on the part of the national government to preserve its rightful supremacy in cases of conflict of authority. In their laws, and mode of enforcement, neither is responsible to the other. How their respective laws shall be enacted; how they shall be carried into execution; and in what tribunals, or by what officers; and how much discretion, or whether any at all shall be vested in their officers—are matters subject to their own control, and in the regulation of which neither can interfere with the other.'