Court Opinion

ID: 6883225
Source: CourtListenerOpinion
Date Created: 2022-07-23 21:21:17.921937+00
Date Added: 2024-06-11T16:05:38.524744
License: Public Domain

On Rehearing.
EVANS, Circuit Judge.
On petition for rehearing, counsel confidently rely upon the recent decision of the Supreme Court of Illinois, Burnett v. West Madison State Bank, 375 Ill. 402, 31 N.E.2d 776. That case involved a suit by a creditor to enforce a bank stockholder’s so-called double liability, created by the Illinois Constitution (Article XI, Sec. 6, SmithHurd Stats.). The suit was begun more than five years after the bank was closed by the state auditor, June 11, 1931. The Illinois Supreme Court held the creditor’s suit against the stockholder arose out of a written obligation and the ten year (not the five year) statute of limitations was applicable.
This case is distinguishable on the grounds:
(a) That the instant suit is one by a receiver suing on an obligation of statutory rather than contractual origin. In the Burnett case the suit was by a creditor to enforce a liability and was held to be contractual in origin.
(b) The instant suit goes still further. It is not to enforce the original statutory liability, for that liability has been paid in full. The suit is for interest which is a superimposed liability (interest on statutory liability), a liability which the Illinois law does not recognize. On no theory could such a liability be construed as one arising out of a contractual obligation so as to fall within the Illinois ten year statute of limitations.
Finally, there is the fundamental question which grows out of the United States Supreme Court decision, which fixes the liability for interest. Under this decision, Casey v. Galli, 94 U.S. 673, 24 L.Ed. 168, liability for interest arose when the Comptroller of Currency fixed the due date of the assessment, September 29, 1932. If not tolled (and we have held it was not tolled by payment of the principal) then the liability expired five years from September 29, 1932. Interest may have accumulated each day, but the liability for interest was the same for each day’s interest. That liability ceased to exist when the five year statute of *719limitations became effective. It is the liability, not the interest due date, that is controlling. When the liability, as such, was extinguished, there existed no basis for interest, on any date. There exists no case for recovery of interest, because the liability for interest does not exist.
The petition for rehearing is denied.
BRIGGLE, District Judge, is of the opinion that the judgment should be for the plaintiff for that part of the interest which accrued within the five years from the date suit was commenced.