Court Opinion

ID: 4997273
Source: CourtListenerOpinion
Date Created: 2021-09-30 16:23:09.5951+00
Date Added: 2024-06-11T08:16:58.524049
License: Public Domain

On Motion for Rehearing.
[6] It is insisted that we erred in holding that article 459 of the Revised Civil Statutes confers upon the commissioner of insurance and banking authority to enforce the. liability of a stockholder who had transferred his shares of stock prior to the date the bank was closed because of insolvency. It is argued with much force that the article of the statute referred to is, by its terms, confined to shareholders who had not transferred their shares of stock. It is also contended *281thnt while the liability of a'former stockholder continues it becomes, after assignment, secondary to that of the existing stockholders, and can be enforced only in an equitable proceeding in the nature of a creditor’s bill. It is true that article 459 uses the language, “the stockholders,” ⅛ authorizing proceedings by the commissioner, and a literal interpretation would support the proposition asserted by counsel for the appellee. But the question is: Would .not that interpretation defeat, in part at least, the manifest purpose of the Legislature in the enactment of this hanking law? In the case of Studebaker v. Perry, 184 U. S. 258, 22 Sup. Ct. 463, 46 L. Ed. 528, the Supreme Court, in construing the federal statute relating to the double liability of shareholders in national banks, uses this language:
“Such may be the true construction of the statute; but, defeating, as it would in the case supposed, the main and obvious purpose of the enactment, such a construction will only be made by a court when compelled by the necessary meaning of the language.”
In determining the full scope of the legislative purpose, the following provisions of the banking act should be considered:
“Art. 453. Whenever any state bank or trust company shall become insolvent and shall voluntarily, or by law, or in any manner as provided in this title, come into the hands of the commissioner of insurance and banking, he may proceed to wind up its affairs, either through a receiver or through some competent person, who shall give bond as may be required by the board, payable to the board, for the faithful performance of all duties imposed upon him. * * *
“Art. 456. Upon taking possession of the property and business of such state bank, the commissioner is authorized to collect moneys due to such corporation, and do such other acts as are necessary to conserve its assets and business, and shall proceed to liquidate the affairs thereof as provided in this chapter.
“Art. 457. The commissioner shall collect all debts due and claims belonging to such state bank.
“Art. 458. Upon the order of the district court, if in session, or the judge thereof, if in vacation, of the county of which such state bank was located and transacting business, the commissioner may sell or compound all bad or doubtful debts, and, on like order, may sell the real or personal property of such state bank, on such terms as the court shall direct.
11 45!». The commissioner may, if necessary to pay the debts of such state bank, enforce the individual liability of the stockholders.”
An examination of the foregoing makes it plain that the Legislature intended to confer upon the banking commissioner authority to fully administer the affairs of insolvent state banks, and for that purpose empowered him to collect from all sources the funds that might be used in payment of the claims of the creditors. If the commissioner had no authority to enforce the liability of former stockholders, his administration might in many instances be only partial; in fact, there might arise cases in which the greater part of the funds available for the payment of the claims of creditors must come from parties who had previously assigned their stock. Unless there is some good reason for withholding from the commissioner the power to enforce the liability of former stockholders, no such construction should be placed upon the statute, since to do so would expose the creditors of insolvent banks to the very hazards and delays which the law seeks to obviate. The same considerations of business policy which justify the remedy prescribed for enforcing the liability of present stockholders apply with equal force to that of former stockholders.
The contention that when a stockholder transfers his shares of stock his liability becomes secondary to that of the remaining shareholders is not sound. Whatever may be the order of liability as between the parties to an assignment of shares of stock, the attitude of the assignor toward the creditors who were such at the date of the assignment continues unchanged during the term of one year. The liability of both parties to the transaction is imposed by law and does not arise from contractual obligations.
[7] As another reason for denying the right of the commissioner to proceed against former stockholders in the same manner he may pursue in enforcing the liability of existing stockholders, it is urged that it would unjustly deprive the former of valid defenses. This is based upon the argument that while present stockholders are liable, to the extent of the par value of their respective shares of stock, for all the debts of the insolvent bank, the liability of former stockholders is for only a part of that indebtedness. That may or may not be true, depending upon the facts of each particular case. Situations may easily arise in which there is no practical difference: As when all of the debts are contracted before the assignment of the stock had been made. In such cases it is not easy to find a satisfactory reason for any discrimination between present and former stockholder in the enforcement of their several liabilities. Nor does it appear that there should be any even where the situation is different. As has been stated, the only difference between the attitude of a former stockholder and that of an existing stockholder toward the creditors of the bank is that one class is liable for all debts, and the other may be liable for only a part.
There is no more injustice in permitting the commissioner to determine that debts exist for which a former stockholder is liable and which render it necessary to enforce his liability than for authorizing him to exercise a similar function as a condition for *282proceeding against a present stockholder. The only fact which a former stockholder may plead which is not equally available to an existing stockholder is that the unpaid debts of the bank did not exist when he assigned his stock. In ordinary proceedings in a court of equity both classes of stockholders might question the existence of any debts, or the necessity for enforcing their liability. It is no more inequitable to deprive one of that defense than to take it from the other.
This particular proceeding originated in the district court, and all the defenses which the appellee claims he might have pleaded in a court of equity were set up in his answer. It appears that the court heard evidence upon the issues raised, and found as a fact that the bank owed debts in excess of the sum sued for vMch existed on the date the appellee assigned his stock to his codefendant, Bodenheim. That being true, the appellee has been deprived of no valid defense.
We are of the opinion that our original construction of the statute as to the powers of the commissioner is correct, and the motion for rehearing is overruled.