Birdsey v. Commercial National Bank, 143 Ga. 627

Birdsey v. Commercial National Bank

143 Ga. 627 | Ga. | 1915

Evans, P. J.

(After stating the foregoing facts.) There are some loose allegations in the petition about the mismanagement of the affairs of the banking association by its directors, but no specific charge of fraud or mismanagement is alleged. There is no contention that the American National Bank or the directors of the Commercial National Bank are wasting the assets of the liquidating bank, included in the transfer of the 1st of August. No judgment or substantial relief is sought against either the directors of the Commercial National Bank or the American National Bank. The only relief prayed is against the Commercial National Bank, and that relief, in the language of the prayer, is “to liquidate the business of said bank and to wind up its affairs.” This presents the question whether a stockholder is entitled to go into a State court for the sole purpose of liquidating and winding up the affairs of a national bank. National banks have been declared to be instrumentalities of the Federal government, created for a special purpose, and as such necessarily subject to the paramount-authority of the United States. Farmers’ &c. Bank v. Dearing, 91 U. S. 29 (23 L. ed. 196). The act of Congress providing for their establishment is a most complete and comprehensive system. Says Mr. Justice Field: “Everything essential to the formation of *630the banks, the issue, security, and redemption of their notes, the winding up of the institutions, and the distribution of tlieir effects are fully provided for, as in a separate code by itself, neither limited nor enlarged by other statutory provisions -with respect to the settlement of demands against insolvents or their estates." Cook County National Bank v. U. S., 107 U. S. 445, 448 (2 Sup. Ct. 561, 27 L. ed. 537). The 4th section of the act of Congress of August 17, 1888 (5 Fed. St. Ann. 193, 194), provides that “All national banking associations established under the latvs of the United States shall, for the purposes of all actions by or against them, real, personal, or mixed, and all suits in equity, be deemed 'citizens of the States in which they are respectively located; and in such cases the circuit and district courts shall not have jurisdiction other than such as they would have in cases between individual citizens of the same States. The provisions of this section shall not be held to affect the jurisdiction of the courts of the United States in cases commenced by the United States or by direction of any officer thereof, or cases for winding up the affairs of any such bank.” Opposing counsel entertain very divergent view's as to the construction to be given the last clause of the proviso in this section. It is urged by the plaintiff in error that this clause has reference to such actions as may be brought by those in charge of the affairs of’ the bank under the provisions of the statute controlling liquidation of national banks, such as by a receiver appointed by the comptroller. We think that wdien it is taken into consideration that a national bank is an instrumentality of the Federal government, under the control of the Federal government, with power to issue notes under certain circumstances, it wms not the intention of Congress that the State courts should have jurisdiction to wind up the'affairs of a national government agency. The very attempt by a State court to distribute all of the assets of a national instrumentality, to take from a national bank all of its assets without regard to any control over it by the comptroller of currency or other national officers, suggests the impropriety of the remedy. In the recent Judicial Code, approved March 3, 1911, in chapter 2, section 24, paragraph 16, it is provided that the district court shall have original jurisdiction “of all such cases commenced by the United States, or .by direction of an officer thereof, against any national banking association, and cases for winding up the affairs *631of sueli bank,” without regard to diverse citizenship. It is well settled that the United States courts have exclusive jurisdiction-in cases commenced by the United States, or by direction of any officer thereof, against any national banking association; and the jurisdiction for winding up the affairs of a national bank would seem to be exclusive.in the United States courts to the same extent as would be a case brought by the United States, or by direction of any officer thereof, against a national banking association. Prior to the act of June 30, 1876 (U. S. Comp. St. 1901, p. 3501), there was no provision for enforcing a stockholder’s liability whére a bank had gone into voluntary liquidation. This act has been construed as limiting the tribunal in which proceedings are to be instituted for enforcing a stockholder’s liability to the United States court, instead of allowing creditors to resort to any competent tribunal with equity powers. Irons v. Manufacturers’ National Bank of Chicago, 17 Fed. 308. Where a national bank has gone into liquidation, and one holding its notes seeks to enforce the additional liability imposed by Rev. St. § 5151 (n e. individual liability), a case is presented under the laws of the United States giving the circuit court jurisdiction independently of diverse citizenship. Wyman v. Wallace, 201 U. S. 230 (26 Sup. Ct. 495, 50 L. ed. 738).

The plaintiff maintains that inasmuch as the Commercial National Bank has ceased to do business and has delivered its entire assets to the American National Bank, it is no longer to be regarded as a public agency, and is therefore subject to suit just as any other person, natural or artificial, under the same circumstances. We would agree with this contention if the subject-matter of the suit were based upon some established ground for equitable jurisdiction, and not excluded by the national banking act. In such cases equitable relief may be sought in any court, State or Federal, which has equity jurisdiction. Thus, in Merchants’ &c. National Bank v. Trustees of Masonic Hall, 63 Ga. 549, it was held that where judgment had been rendered in a State court against a national bank and upon the execution issued a return of nulla bona had been made by the sheriff of the county where the bank was located, and the bank had ceased to discharge its functions as a fiscal agent of the United States, and was disposing, among its stockholders, of its assets which could not be reached by levy and *632sale under the common-law execution, thereby endangering the safety of those assets and the judgment debt of the creditor, equity would relieve by the grant of injunction and appointment of a receiver. The purpose of the bill in that case was not to wind up the affairs of a national bank, but to subject in equity assets of the bank which had been fraudulently taken possession of by its officers. In Cogswell v. National Bank, 76 Conn. 252 (56 Atl. 574), it was said: “For winding up proceedings, in cases of insolvency, or certain other defaults on the part of the corporation, Congress has made special provision by means of a receiver appointed under authority of the United States.” U. S. Rev. St. §§ 5141, 5191, 5201, 5205, 5208, 5234; 19 U. S. St. L. 63; Cook County Nat. Bank v. U. S., supra. We are of the opinion that the allegations of the bill are too indefinite to make out any case of fraud or misconduct on the part of the directors of the consolidated bank. It is not charged that the directors held less than two thirds of the stock of the bank; and although the act of consolidation may have been ineffectual, in that there should have been a formal stockholders’ resolution assented to by two thirds of them (Bev. St. § 5220), nevertheless, as there is no charge that the consolidated bank which has all of the assets of the merged bank in its possession will waste such assets, and as the only relief prayed for is to wind up the affairs of the liquidating bank, we think that the complaining stockholder is limited to the Federal court to obtain that relief, if entitled to it upon the refusal of the comptroller of currency to act.

Judgment affirmed.

All the Justices concur.