Case Name: STATE ex rel HOWELL, Atty. Gen., v. BANK OF GLENROCK (SCHULTZ et al., Interveners)
Court: Supreme Court of Wyoming
Jurisdiction: Wyoming
Decision Date: 1927-03-01
Citations: 36 Wyo. 125
Docket Number: No. 1291
Parties: STATE ex rel HOWELL, Atty. Gen., v. BANK OF GLENROCK (SCHULTZ et al., Interveners.)
Judges: PotteR, J., and Kimball, J., concur.
Reporter: Wyoming Reports
Volume: 36
Pages: 125–132

Head Matter:
STATE ex rel HOWELL, Atty. Gen., v. BANK OF GLENROCK (SCHULTZ et al., Interveners.)
(No. 1291;
March 1, 1927;
253 Pac. 665.)
John D. Dawson, /or appellants.
G. Leonard Smith, for respondent.

Opinion:
Blume, Chief Justice.
The Bank of Glenrock, a banking corporation, suspended business on the 14th day of February, 1924. _ On August 2, 1924, an action was brought in the District Court of Converse County by the State of Wyoming, on the relation of the Attorney General, against said bank, asking that the banking corporation be dissolved and placed in the hands of a receiver. After notice was given to the bank, and upon a hearing on the petition aforesaid, and on August 4, 1924, F. M. Dumm, the cashier of the bank at the time of its suspension, was appointed receiver thereof. He duly qualified as such receiver on the 11th day of August, 1924, giving a bond in the sum of $25,000 for the faithful performance of his duties. On September 30, 1924, the interveners herein filed a joint petition of intervention, alleging that they were depositors in said Bank of Glenrock and asking for the removal of the receiver, upon grounds hereinafter mentioned. F. M. Dumm filed an answer to such petition. The matter was heard on October 30, 1924, and the court held that no grounds existed for such removal and dismissed tbe petition of tbe intervenors. From tbis order of dismissal tbe intervenors have appealed to tbis court.
It is claimed in tbe first place that tbe court erred in appointing F. M. Dumm, and, therefore, also accordingly erred in not removing him. It is urged that Dumm was interested in tbe receivership matter and was, therefore, disqualified to act as receiver by section 6185, W. C. S. 1920, which provides that "no party, attorney or person interested in an action shall be appointed receiver therein except by consent of the parties." No interested person should, accordingly, be appointed receiver unless the parties to the action consent. It may be questioned whether the intervenors, depositors in the bank, were parties to the action in the sense that their consent was necesary to the appointment. In the case of State ex rel. v. Superior Court, 87 Wash. 603, 152 Pac. 1, the court said:
"It is plain that the relators here were not named as parties in the original receivership case. The plaintiff in that case was the State of Washington, upon the relation of the attorney general. The defendant was the Raymond Trust Company, an insolvent banking corporation. While the creditors of the banking corporation are no doubt interested in the result of the receivership proceeding, they are not parties to that action. They are, at most, quasi parties, interested only in the proceeds of the assets of the insolvent corporation."
Let it be conceded, however, for the purposes of this case, that the intervenors were parties in the sense that their consent was necessary. It appears that some of them gave such consent — how many is not shown. It is clear that those who gave it cannot complain of the appointment, and inasmuch as we are unable' to tell from the record which of the intervenors may and which of them may not complain, relief on the ground stated must necessarily be denied to all.
Three other grounds for the removal of Dumm are discussed in the brief of counsel for appellants. The first ground is based on- the fact that, at the time of the filing of the petition of intervention, he was cashier of the First State Bank of Douglas, and that he kept the money which he had collected as receiver, amounting to approximately $12,000, in that bank. If the First State Bank of Douglas is, however, not a proper depositary of this money, the court, upon application and a showing of that fact, will, doubtless, make a proper order safeguarding the funds, and we are unable to see why the receiver should be removed on the ground stated.
Again, it is claimed that the receiver should have been removed because Dumm, prior to his appointment as receiver,-was a trustee of School District No. 15, situated in the town of Glenrock, and that, as such trustee, he permitted the funds of the district to be deposited in the Bank of Glenrock, without requiring a bond from the bank. The School District is not here complaining and did not join in the petition of intervention. The theory, apparently, is that the School District might claim a preferential right by reason of its deposits in said bank, and that Dumm, by reason of his former relation to the district, would not be in a position to properly resist the claim. If this could become important, it does not appear that any such claim has actually been made or is likely to be made. The matter is purely speculative, and would not at this time furnish sufficient ground to require the court to remove the receiver.
Finally, it is urged that Dumm should be removed because, while he was cashier of the Bank of Glenrock, he failed to comply with the provisions of section 5211, W. C. S. 1920. That section provides that a bank operating a savings department may invest ninety per cent of the funds deposited in that department in the bonds of this state, of the United States or of any city, county, town or school district in the state, or may loan such funds upon notes secured by a mortgage or trust deed on unin-cumbered real estate. It is argued tbat Dumm, together with bis co-directors in said bank, might be liable because of the failure to comply with the statute. There is no showing that any -such action is contemplated. Inter-venors do not seem to be interested therein; it is not shown that they deposited any funds in the savings department, and the matter appears to be purely speculative. Nor has it been shown that the requirements of section 5211, supra, were violated. The only testimony relating to the matter was given by Dumm, and the material portion thereof is as follows:
' ' Q. Did you ever have ninety per cent of that money invested in bonds of this state? A. No sir. Q. Or bonds of the United States? A. No sir. Q. Or in bonds of any city, town or school district? A. No sir. Q. Did you confine the loan of that money to notes secured by first mortgages or trust deeds on real or personal property twice the value? A. No sir."
While this testimony shows that the bank did not invest ninety per cent of the savings deposits in bonds of the state, or the United States or a city, town or school district, it might have had eigthy per cent or ten per cent or any other per cent thereof so invested. And while it was shown that the loans were not confined to first mortgages' or trust deeds on real or personal property, some of the money may have been loaned, while the remainder was invested in the permitted class of bonds. We are unable to tell what the facts are.
It appears that Dumm was not responsible for the failure of the bank, and did not contribute thereto. He was appointed receiver because he was deemed most competent to wind up the affairs of the bank, because he was willing to serve for a comparatively small compensation and because his appointment had been recommended by a committee of the creditors as well as a number of the de positors and interested parties individually. His appointment was deemed to be tbe most advisable under tbe circumstances. Tbe receiver is under tbe control of tbe court, and it bas more or less intimate knowledge of tbe matters involved in tbe receivership. Whether or not tbe receiver should be removed is ordinarily, at least where tbe original appointment was not illegal, largely in the sound discretion of tbe court. 34 C. J. 175. We do not think that a sufficient showing bas been made herein to indicate that this discretion was abused.
Tbe judgment of tbe District Court should accordingly be affirmed, and it is so ordered.
Affirmed.
PotteR, J., and Kimball, J., concur.