Court Opinion

ID: 6737804
Source: CourtListenerOpinion
Date Created: 2022-07-20 23:19:54.838593+00
Date Added: 2024-06-11T16:01:51.567393
License: Public Domain

Hanley
(concurring). I concur in the principles of law stated in the syllabus, and in the conclusion announced in the majority opinion.
As I understand the argument of counsel for appellant, they present two questions to the court on this application.
First, they question the right of the court as constituted on December 28th, 1916, to deny a rehearing and transmit the remittitur to the trial court, on the alleged ground that the terms of office of three members of the court as then constituted expired on the 4th day of December, 1916, and therefore the action of the court in denying the rehearing and transmitting the remittitur was a nullity.
Second, the appellant appeals to the discretion of the court as now constituted to consider the case on its merits, in passing upon the application for a rehearing, even if it is conceded that the court as constituted on December 28th, 1916, was a de facto court. And on this question argue, on the merits of the original controversy, that the court, in its original opinion, — Youmans v. Hanna, ante, 479, 160 N. W. 705, — misunderstood the question presented and argued, and that said court at that time did not give the proper consideration to the case, on the alleged grounds that it was advanced on the calendar and hurriedly heard.
As to the first question, the appellant challenges the jurisdiction of the court sitting in State ex rel. Linde v. Robinson, ante, 410, 160 N. W. 512, which was a proceeding in which the court as then constituted issued an order to show cause why the court should not take jurisdiction and determine the question as to when the term of office of the newly elected justices of the supreme court commenced.
I am of the opinion that the petition filed by the attorney general, and which instituted the proceeding, was insufficient in that it did not state facts sufficient to constitute a cause of action in favor of the state and against the justices elect, in this, that the said petition asked the court to exercise its original jurisdiction preventing or restraining Jus*528tices elect Robinson, Grace, and Birdzell from taking office, and, as grounds, alleged, among other things:
“That at the general election held in November, 1916, said Justices Robinson, Grace, and Birdzell received a majority of all the votes cast, and were chosen and elected'as justices of the supreme court of this state, to succeed Ghief Justice O. J. Fisk and Judge E. T. Burke and Judge E. B. Goss, but that as yet, at this date (the date of the filing of the petition), no official canvass of the vote had been made.
“That under the Constitution and laws of the state of North Dakota, and the custom prevailing in the state, the terms of office of the justices elect will begin on January 2nd, 1917. That the incumbent justices constitute a majority of the supreme court, and that there is at present before the supreme court a large number of cases which have been argued, and submitted and undisposed of because it is generally assumed that the terms of office of their successors begin in January, 1917, and not in December, 1916.
“That there has been brought to the knowledge of the incumbent justices that the three justices elect will claim and contend that their terms of office begin in December, 1916, and that Justice elect Robinson has by letter communicated to the chief justice his contention that the term of office begins in December, and that he will then demand and exercise his l’ight to qualify and take said office. That a letter purporting to have been signed by said Justice elect Robinson has been printed in the Bismarck Tribune and Fargo Forum, and perhaps other papers of the state, setting forth his views in the matter, and that in the Grand Forks Herald of November 28th, 1916, Justice elect Birdzell is quoted as having stated that should a fight be made, he would stick by his colleagues.
“That the said justices elect are each and all threatening to intrude into and assume the office of justices of the supreme court unless restrained from so doing. That by reason of the said matters and proceedings to be taken by the said justices elect, confusion and uncertainty exist as to who is entitled to hold the office; that the state, as plaintiff, is entitled under the Constitution and laws to have a supreme court- that shall not unlawfully be hindered, impeded, or interfered with, and that the court should by its original writ prevent the usurpation of office by the justices elect and prevent their intrusion, or *529attempted intrusion, into the office, and should assume "jurisdiction in the matter and declare which justices are entitled' to hold the office during the month of December, and determine as to who is entitled to the salary during that month, and for such other relief as the court might grant.”
This petition is based upon letters of one of the justices elect and upon newspaper accounts of what might happen, and there is no allegation in the petition that any steps or acts had been taken or committed by any of the justices elect seeking to take the office by force or threats of force, and to my mind the effect of the petition was to ask the court to anticipate a possible state of facts that might arise' 'and to try the title to the office in a summary manner, and by injunction, and was in effect a petition to try a cause of action before it actually arose.
If the facts presented in the petition were such that it wás claimed that the justices elect had offered or attempted to take physical possession of the office and the books and papers, another situation would have been presented.
But as I understand the petition filed in the matter such were'not the facts alleged, nor do I understand that the petitioner brought the proceedings within the facts stated in State ex rel. Bolens v. Frear, 148 Wis. 456, L.R.A.1915B, 569, 134 N. W. 686, cited by the court in State ex rel. Linde v. Robinson, supra.
That the petition does not state facts sufficient to state a' cause of .action also seems to be borne out by the fact that thé court as constituted in that case, did not issue an order directed against the three justices elect as petitioned for, but issued an order to show cause against, not only the three justices elect, but the three incumbents, which directed all six of the contesting judges to appear and show cause why the court should not take jurisdiction of the matter and determine the title to the office in a summary manner.
I cannot see the distinction between this and issuing a writ or order to show cause in any case and deciding it in a summary manner where the title to office is in alleged dispute, and it seems to me that a dangerous precedent has been established in this matter.
I, as district judge, sitting on the court,-concurred in the issuance of the order to show cause to all six of the justices, not on the grounthat the court had a sufficient proceeding before it, but upon the ground *530that in the controversy that had arisen between the contending parties a court should be offered to the contending justices in which they could settle the difficulty. State ex rel. Linde v. Robinson, ante, 410, 160 N. W. 512. When the justice elect filed written objections and took the position that the court had no jurisdiction in the matter, I, for the reasons stated, did not act further in the proceedings. However, the remainder of the court held that the court did have jurisdiction of the subject-matter and of the parties, and in State ex rel. Linde v. Robinson, ante, 417, 160 N. W. 514, held that the term of office of the judges of the supreme court commenced in January, and not in December. The reasoning of that decision, and particularly the portion of it which holds that it has been the implied construction since statehood that the term begins in January, and not in December, is difficult to follow. ’This is particularly so in view of the fact that at least two of the retiring judges whose terms were involved in that decision took their oath of office in December when first elected, and made formal demand for the possession of the office that month. In justice to them, however, it should be said that they made such demand in order to protect their rights in case a controversy arose, rather than to compel the possession of the office. I am requested by Judge Cole, sitting in this case, to state that he also questions the reasoning of the court as constituted in State ex rel. Linde v. Robinson, ante, 417, 160 N. W. 514, in which it held that the term begins in January, rather than in : December. I am satisfied, however, that when the court handed down this opinion, it became the law of the case and settles the question as to the time of commencement of the terms of office of judge of the ‘ supreme court in this state.
. That decision of the court was acquiesced in, and during the month December, 1916, the three retiring judges continued to sit on the court and transact its business, and during that time constituted the only supreme court of the state that transacted business. The old court was recognized as the supreme court during that month, and certainly was at least a de facto court during the time when the petition for rehearing in the instant case was denied, and the supreme court of this state having heard and decided on the merits the instant case prior to the first Monday in December, 1916, when its right to act was unquestioned, and having denied a rehearing in the matter on December 28th,. *5311916, when it was the only acting supreme court of the state, and at least a de facto court, and having at said time intentionally transmitted the remittitur to the lower court, I am satisfied that, under the law and the decisions, the case is ended, and for the reasons expressed in the majority opinion, this court cannot now and again consider a petition for rehearing.
In determining the question as to whether or not the remittitur which finally terminated the instant case was properly sent down or transmitted to the lower court, each one of the court as now constituted has gone through the record from its inception, and in view of the fact that the counsel have argued so strenuously that an injustice was done on the merits of this case, it may be proper to make a statement of what the facts in the case are.
I am satisfied that the record shows that the original opinion of the court on the merits was correct, and certainly such opinion shows that the court went carefully into the whole record, even though it is argued that the case was hurried to a decision.
The testimony of the plaintiff, Youmans, discloses that he and his wife held the great majority of the stock of the bank involved in this action, and that he also owned a great majority of the stock of the Savings & Trust Company operated by him in the same building. That in the assets of the bank was a large amount of paper which was not bankable, and objection being made to this paper by the bank examiner and banking- board of a previous state administration, he in the space of one or two days collected a number of strangers in Minot, and by arrangement with them, and for no adequate consideration, conveyed to these different strangers, a number of quarter sections of farm land already mortgaged, belonging to him or to the loan company, and took back from these strangers notes and mortgages on the land, and then had the strangers redeed the land to him or his loan company, which deeds he kept in his possession unrecorded. He then took these notes and mortgages to the amount of over $50,000 and put them in the bank as assets, and the credit therefrom was used by him or his loan company. The effect of the transaction was the placing of mere paper assets in the bank to that extent, and which added not a dollar to the market value of the assets of the bank or himself or the loan company. The effect of the transaction was a loan by the bank *532to himself or his loan company of over $50,000, and this, in direct conflict with § 5172 of the Compiled Laws 1913, which limits the liability of any one person or corporation to a bank at 15 per cent of the capital and surplus stock of such bank.
The plaintiff admits these transactions, but claims it was a “banker’s trick” and that “they all do it.”
The transaction was not only “high financing,” but under the provisions of the Code, § 5173 of the Compiled Laws 1913, enacted for the protection of depositors in banks, was an offense for.which the plaintiff could have been prosecuted in court.
These mortgages also represented on their face that they were first mortgages, when as a matter of fact there were other and outstanding prior mortgages on the different tracts of land to the full loan value thereof, and, if these second mortgages were represented as first mortgages, and if exhibited to the bank examiner with intent to deceive, that act would be a criminal offense under the laws of this state (Comp. Laws 1913, § 5174).
In disregard of many orders of the banking board a large amount of this paper remained in the bank at the time it was closed by the bank examiner. Under the laws of this state a bank under such conditions is deemed insolvent (Comp. Laws 1913, § 5189), and under such conditions the banking board has authority to close the bank, and it becomes the duty of the banking board to forthwith take possession of any bank becoming insolvent, or which violates the provisions of the Banking Laws (Comp. Laws § 5183).
The banking laws of this state provide that no bank shall carry among its assets at any one time loans dependent wholly upon real estate security in any amount exceeding 25 per cent of the total loans and discounts, and then only upon first mortgages, which shall not exceed 40 per cent of the actual cash value of the property mortgaged. Comp. Laws 1913 § 5150, ¶ 8. The record in this case discloses that at the time the bank was closed more than one half of the assets of the bank consisted of loans dependent wholly upon real estate, which was in violation of the provisions of the law which has for its purpose the conservation of the assets of a bank for the protection of its depositors.
Under these facts the bank examiner closed the bank, and there was *533no contention at that time by the plaintiff that the bank was solvent under the law; but he claims that the bank examiner demanded that he deposit more cash in the banks as assets than was necessary to make the bank solvent, and that the bank was taken away from him as a result of a conspiracy by the defendants to deprive him of his property. If at the time the plaintiff believed that the amount demanded was too much, he had his recourse in the courts by an action for a restraining order to prevent such demand, and in that proceeding the exact amount required to make the bank solvent could be determined. Instead of doing this he negotiated for the sale and disposal of the bank, and sold the same to the defendants, Barron, Byorum, Johnson, and Basmussen, who are not connected with the banking board, on condition that they should make the hank solvent and protect the depositors, and relieve the plaintiff of all liability in the matter. This the defendants mentioned agreed to do on the transfer, of the bank to them, and the giving to them of a note and mortgage in the sum of $5,000 by the plaintiff, which was the amount of the plaintiff’s individual indebtedness to the bank.
The transfer papers in this transaction were made by the plaintiff himself. No action has been started by him to set the transfer aside, and his offer of proof discloses that if he had desired to he could have opened the bank and not transferred it, as he was offered sufficient funds by his friends, to place in the bank as assets to the amount required by the examiner and the banking board. Nor was the transfer without consideration to the plaintiff, as by its terms he relieved himself of the liability fixed by statute (§ 5168, of the Compiled Laws), under which his property in the loan company, and other property, would have been liable for the debts of the bank.
Counsel complain of the manner in which the bank examiner took possession of the bank and its assets, claiming that he arbitrarily excluded the plaintiff from access to the bank.
Under the law the bank examiner has the authority, and it is his duty, under the direction of the banking board to “forthwith take charge of an insolvent hank.” Comp. Laws 1913, § 5183. And the object of this statute is undoubtedly to place the assets of an insolvent bank completely in the hands of a bonded officer of the state, to the exclusion of all persons, even the officers of the bank, to the end that *534the assets remain intact. It is true that the statute contemplates that the assets be held pending action in court and the appointment of a receiver, but such action became unnecessary, as the plaintiff, as before stated, transferred the bank to purchasers who, under the banking laws, deposited assets enough to make the bank solvent and agreed to protect the depositors and relieve the plaintiff of further liability.
The errors complained of in the trial court are largely alleged errors in receiving or rejecting evidence.
In my opinion such errors, if any, are nonprejudicial, and could not affect the final decision in the case, for the reason that, under the plaintiff’s own testimony, he failed to show a cause of action, and established the fact that, under the facts testified to by him, it would be impossible to recover on the theory that a conspiracy existed under which the bank was closed and taken from him.
The trial court was right in directing a verdict for the defendants.
The petition of the appellant for a rehearing in this matter should be denied.