*1 259 SOUTHWESTERN REPORTER 4S7, 446, board, art. providing article in the was first have a estate shall CHAPMAN, of Insurance and Commissioner lien for the benefit Banking, assets of bank et STATE al. v. GUARANTY fund, held, banking beard (No. state 10730.)* al. BANK et joined (cid:127)syas properly as defendant. (Court Appeals of Civil Texas. Fort Worth. of demurrer, &wkey;s2l4(l)— general Pleading 5. On 5, Rehearing Jan. Denied 1924. allegations accepted petition of as true. 9, 1924.) Feb. allegations petition, general demurrer On to <®=»I9( power (1) Sovereign sued not States 1. — interpreted accepted therein are as true without consent. light plaintiff. to favorable most ' sovereign power not that the The rule of banking be sued consent without its <@&wkey;G3½1Objection 6. Banks and — application. judicial universal sale of defunct bank’s assets was only sale to set not be aside on direct attack &wkey;>l91 against (I) States commission- 2. —Suits sustained. banking board held not er within rule and state bank of against In insur- suit the commissioner of against prohibiting state actions banking banking ance rescind, tations, sumed board to state without its consent. ground represen- of fraudulent on objection against an a bank action An to whereby plaintiff as- a contract of sale banking of and insurance commissioner bank in con- a defunct indebtedness of alleged misrepre- board, state bank sentation bank, the assets of based turned of sideration over assets thereof which a as tо assets of defunct value of plaintiff sum recover the to to bank plaintiffs to to contribute induced by plaintiff bank which had been contributed organized to take over bank discharge applied in of of debts which was part to recover back defunct bank’s assets defunct the sale n the having moneys privilege con- so contributed approved by judge aft- district ferred, extent contribution which to pursuant hearing in to Vernon’s er Sayles’ vacation deposit guaranty fund, that the suit relieved was plain- 458, 1914, Oiv. art. Ann. St. against consent, one untenable; state without proceeding being party before tiff not the moneys sought to thus be held except purchaser, judge as it named wholly being the control under recovered all, by inference, being only if at and it presented directly being banking state board said that the issue could be subject-matter pecuniarily interested and of proceedings be- or determined say, reasonable to suit objection judge, held, to fore the Complete 1920 or Vernon’s Tex. Stat. view of judicial ground that the suit one, set sustained. sale 461, Sayles’ 453, 464, Ann. St. arts. Civ. character, be final in which could deposi- relating to the matters suits in to attack, not be would a direct aside without authoriz- tors’ and article n ing application for relief cer- the courts instances, at least im- state has tain pliedly <&wkey;948( Judgment judi- I) Ordinarily, res 7. — suit. its consent to the pleaded. cata must Ordinarily, judicata res must the defense of &wkey;>l9l(2)Complaint decree States 3. — pleaded be available. per- against not to board held bank state against members. individual sonal banking <&wkey;63l/2Misrepresenta Banks — by bank its directors to re- In action ground banking tions for commissioner held bank bank scind contract between rescinding bank. of defunct assets of a took over de- bank assets board which In contract sale of as- action rescind in and assumed commissioner for funct bank liquidation hands bank plaintiff sets ground bank in the defunct bank certain liabilities on of fraudulent de- representation commissioner as of state bank whereby plaintiff commissioner, fendant bank over, complaint solvency assets turned was induced to assume certain liabilities held, against plaintiffs and decree for the bank, held, that mis- defunct under evidence banking commissioner of representations by insur- the commissioner of individually, bank board members of banking ance bank as to examiner in their official ca- them rather than though innocently made, solvency assets, pacity. justified of the sale. rescission <&wkey;63½ bank 4. Banks and —State Findings < n =»63!/2— properly joined in suit 9. Banks and board inducing pur- . of bank commissioner commissioner. fraud chase of bank . assets defunct bank ratified against state suit In not set aside. plaintiff whereby contract rescind purchase In contract assets of a defunct bank suit rescind take over induced to and misrepre- certain of a defunct bank thereof to the liabilities assume extent arrange- received, in absence of which sentation value, state bank commissioner and and bank examiner as ment the required dispose evidence, find- held, that the trial have been under courtA would solvency ing, knowledge assets, and, proceeds plaintiff’s thereof debts of the transferred to *2 GUARANTY STATE BANK CHAPMAN v. (259 S.W.) misrep- CONNER, Pretermitting J. for of C. ratification be worthless was resentations, present thought be set aside. to be neces- statements pre- sary disposition questions &wkey;>83!/2Inability banking 10. Banks and — outline, case, sented, of this the facts quo completely defense held no restore statu appears during that it purchase com- banking to rescission of duly Cleburne, Tex,, in- State of then bank. assets of defunct missioner of corporated under the laws of state of by its directors bank and In action Texas, acting insolvent, became and the then state bank bank and between rescind contract qualified commissioner by Board, assets took over certain bank which banking, Hall, Hon. Ed. closed its doors of commissioner in hands of of tain indebtedness of defunct bank possession of its and took Thereafter, of assets. all cer- banking insurance and assumed process where of ad- as a means and defunct large proportion liquidating the defunct of vantageously of assets of ap- for not available worthless and bank Bank, wit, another by plication assumed that bank to debts of Tex., Cleburne, Bank of State paper plaintiff offered to plaintiff bank, which duly organized incorporated plaintiff inability return, of held, by parties, laws referred to interestecl defendants, received return whereupon bqnk managing of directors the new by proximately caused of which had loss of commissioner defendant, not defeat the fraud banking negotiated a certain action. the Traders' Bank. The terms assets of State <&wkey;l87(3)Objection on Appeal error 11. — agreement into then entered against parties to suit ground defect briefly stated purchase ot banking to rescind banking deposited insurance not sustained. bank assets of defunct Bank, out of the state lia- plaintiff , certain bank assumed Where $200,000 cash, and delivered the same of commis- in hands defunct of a bilities sioner together banking in considera- insurance the other assets the Traders’ turning certain to it of over tion of the of including several hundred thousand dollars plaintiff thereafter bank and the defunct promissory obligations then notes or by the commissioner bank was insolvent, over by thought their face value. The stock- to rescind contract in action by and its direc- hplders taken over аssets were Bank also con- banking against tors board, accept cash, $100,000 tributed later its funds did not creditors where alleged sum of to cover bank’s obligation off defunct its sale thus assets. The contract of plea in abate- was no formal debts ment for approved the district court outlined was parties to make proper failure want county upon application of Johnson plaintiff bank’s creditors appears It further commissioner therefor. plaintiff. objection for available arrangement that under this new anty the Guar- something operated like Kehearing. Motion On year, April 4, one until when <&wkey;1122(3)— Appeal Court and error declared to be turn bank also was Appeals find- additional make' Civil need solvent, Chap- E. and was closed Hon. J. evidentiary, ings immaterial which are man, the then commissioner insurance undisputed matters. involve! possession took as- who duty Ap- of the Court Civil It is not the thought Such further statements as are sets. to be findings peals grant for-additional a motion connection, necessary made in evidentiary will be immaterial, are either subjects character, discussed. are not dis- matters which involve puted. was instituted This suit directors, present Appeal Court, Johnson Coun- petition, pres- from District named in are ent commissioner and the Ward, Judge. ty; Irwin.T. of insurance and Texas, all of Action State Sаnk alleging named, whom Chapman, others of L. J. Commissioner aggrieved by closing had been Guaranty Judg- Banking, Insurance and and others. State Bank and the action of plaintiffs,' ment -for appeal. and defendants taking possession commissioner in of its the assets, Affirmed. substance, alleging, Atty. Keeling, Gen., W. A. entering Walace the contract sale of into Hawkins, Goodwin, Wall, John C. John W. of the Traders’ State as above Black, appel- Austin, acting indicated, Chas. L. all of then commissioner of lants. fraudulently mis- Gayle Prestridge, Cleburne, represented B. promissory Bai- value of the *3 sought provisions relating which, The our De-j all because chap- posit enjoin in are to found Law be commissioner up winding 5, 14, Complete liquidating title the ter Texas Statutes chapter provides our incor- 1920. This porated bank and to rescind affairs of the protect may their de- referred state banks of sale hereinbefore contract by positors availing of the the sum of either themselves of the defendants and $125,000, recover depositors’' guaranty provided to the before fund for in had been contributed depositors’ chapter, the curity se- bond provided alleged system, stated, A had been also for. bank and which composed discharging created, applied board was Attor- indebtedness of in ney General, Bank, or, in the alterna- a commissioner of insurance and Guaranty banking, tive, treasurer in of the of the state. *4 railway certain enforcement of restrain the quoted approval Okl. 112 Pac. promulgated which had tariffs or rates by Lankford, in Lovett v. 767. 145 Pac. 47 Okl. By Railway a decree Commission. & Great court the International of the lower See, also, opposition appellants’ con- Company perpetually Railway Northern enjoined tention, Herring cases v. Houston Na- continuing putting ef into Exchange (Tex. App.) tional Civ. 253 Railway Com or tariffs of the rates fect the 813; Banking S. W. Middlekauff v. State complaint, and the in the mission described Railway Board, Tex. Hall v. S. Attorney General Commission (Tex. App.) First National 252 S. Civ. pen instituting any suits of Texas from W. 828. Supreme appeal alties, Court On etc. can n Moreover, reasonably think be States, opinion Mr. in an the United state, by implication, said that at least disposing Brewer, held, it was Justice given has its consent to suits the character against the suit the contention that was one provided under consideration. It is in article pe Texas, “in a state the state cuniary chapter Deposit 473 of anty our 5 of Guar- all,” had no interest at sense (repealed Law since the only parties pecuniarily affected court) trial that— stating: carriers, shippers further “Whenever such state of whose may doubtless, sense, it “There is a property and businеss the commissioner has ques- be state in the is interested said possession, aforesaid, taken deems itself only governmental tion, terested just but cuniary It is in- sense. but a aggrieved thereby, any time, apply may, 'at' citizens, well-being in the court, session, to the district if in or to the laws; equal enforcement of all its judge thereof, vacation, if in district in pe- the governmental not the interest such is transacting bank such is located and busi- it to bear which causes interest enjoin proceedings; ness further and said judgment. aNot dollar of an adverse burden session, thereof, judge court if in treasury state, from the will no taken be vacation, citing the commissioner to show enforced, obligation pecuniary be it will .of why proceedings cause enjoined, of upon further not be - any property decree affected none of its which hearing allegations proofs nearly may so rendered. It is not be determining may, facts, in this case as the decree affected much merits, application, dismiss such stay- injunction against officers would be enjoin proceed- the commissioner frequent yet taxes a collection ings him to and direct surrender such business jurisdiction unquestioned exercise property to such state bank'.” restraining federal, courts, collection of is state part.” illegal taxes, or in in whole requires presentation The act of Lank- case claims an insolvent bank taken in in the later true that It is Supreme presented Co., charge by him to be to the com- Iron Works Platte ford v. of in a missioner and it rendered deci- United States Court of said, cursory chapter upon may ex- article enacted that —- sion which ap- support amination, pellants viewing the contention justice “If the commissioner doubts subject. re- a case That any claim, reject validity and may same, he rejection Court upon District decree serve notice of such claimants, District either the-Western mail written notice States the United personally served. An directing affidavit of the service Oklahoma, state notice, prima of such which shall be facie evi- repay in an state to thereof, dence shall filed with the commis- guar- depositors’ insolvent upon rejected sioner. The action the claim so alternative, fund, or, to issue a brought must months after within six such levy an assess- indebtedness certificate of service.” up any It the fund. make deficit in ment designate one the suit in effect was Article does the court in held that instituted, forbidden the state action shall be but some certainly Oklahoma which the reading judicial rule, proper the decision action court theory upon chapter implied. articles Other also disclose imply By fund of Oklahoma under court action. article seem 259 SOUTHWESTERN REPORTER
par, ties of said Traders’ State and longing would der the laws of cluding his assistants and tions resulted commissioner of insurance and solvency, of into Traders’ State fixtures, Traders’ tors in tion C. V. ganization as, Attorney sets judgments does, ferred we overruled. for the appellants sioner provisions, teenth ond, required by think case liberally ply error and limited tent posed interest.” is and necessary imply quoted, the commissioner “deems itself acter the affairs through of the assets benefit “said bond [3] $100,000, and wind said bank and close substance, a like the cash procure of said Traders’ and to assume negotiations by fifth, person, comes a benefit By appellants’ Terrell, organize the district of judicial action, by assignments of said faithful by a view of authority a receiver or State and that valued General, court erred construed, and, aggrievance propositions complaint and of a bank under State amount By decided may express fairly such up him.” And of an insolvent of Texas with a on hand and all allege statute. his assistants treasurer, of the insolvent Bank of Cleburne aggrieved thirty-seventh assignments whose said Traders’ State Bank article statute and opinion performance of all duties its affairs board, payable perhaps Guaranty liquidation terms of which privilege, has expert at shall court for taking appellants and in employees within Guaranty of error J. a like to take agreement given power wind recovered terms approximately $41,000', tors’ State Bank third, and that said take solvent “employ house, furniture, while L. So through thereunder appellees give assistance as and W. over the after the rendering personal thereby,” may Chapman, others, favor it is enacted that, amount of liabili liabilities of so same and entered is, Bank. the commissioner Bank; relief. The char- possession, which the laws of Tex declares appellees *5 conferring, it is bond as fourth, and distribution article did appellants’ State Bank charge good paper represented paid-in construed, n privilege such bank. between said and business State cases is some any party and to close take A. think, complained of the act solvent employees, Appellees, assets, investiga appellees Keeling, negotia counsel” commis and may capital that a assum “either or in this charge compe- its in whole, board, These to said direc to be said said con- first face sec- un be im- as in ap- or fif we of np appellees be' and be er at sumed it remaining drawing said amount from the sum of resolution ferred to Bank the contract which said said State Bank bills ble that were not rectors of said ferred formation instance which sioner Guaranty Guaranty ing commissioner solvency not because part lying upon faithful, fully nothing for loans made loss and at and received April 4, mediately to ance with ty banking State Bank under the sioner. applied longing ers’ to or the said Traders’ that believing ers’ State Bank and that the cash, notes, sets of said anty Appellees placed replace bad claims theretofore Cleburne, State at State Bank and guaranty fund, value, relying upon and good greater would include all of said to it said bank assumed said bank represented for and received the to said to by and careful Bank business there until on said unlawfully State times have State Bank to with cash claims, together bills bills commenced to authorizing laws depreciate said the notes and other by the paid further by the assets of and other Guaranty entered into its since said from the and continued to do a State in value than and his profit, from (cid:127)- said Guaranty when said bank representations appellants, solvent and were worth their by Traders’ State Guaranty was conducted in an laws receivable receivable of said Bank any organizers receivable good contrary, good, by State Bank then it, its $200,000 commissioner, adopted Texas, Bank; said notes, warrants, appellants, allege had taken and that he would any fault or and that manner, been, ready said commissioner was- closеd belonging then the value organization that he had holdings operation and clean assets State assistants as to the officers of said and that Texas, notes State bills accept said State that said into said give and received from assets were that said belonging that said with the president equal of said from the the liabilities of house the board of di- organization by charter therefor Bank; notes, failure on theretofore Traders’ State and in receivable Bank, received appellees made having to said Bank by appellants Bank, and the clos- bills receiva- said commis- of the assets and paper and execute liabilities of in said transferred said said Trad- caused to furniture, had done warrants, Guaranty or about being $313,000, Traders” other as- and oth- commis- Guaran- without and by to- of said compli- deposi- willing honest, wrong- at the no in- trans- trans- with- Guar- Trad- equal by take said said are, city im- be- re- as- by - Tes.) BANK GUARANTY STATE CHAPMAN (259 S.W.) required pa- good back all and other take notes Bank were then per Guaranty transferred to said State Bank face value. were worth their clean assets and by appellants, greater allege at the time said Appellees further good transfer was not ue, val- part not worth face then worth- receivable were of the bills Guaranty appellees said Bank should less, State were deceivеd credited with a like amount of liabilities as- said com- aforesaid by it, Guaranty sumed should be assistants, and said State Bank said and that missioner and open permitted Guaranty re- doors and have execut- would not required pay sume business without any officers had or its said bank ed said contract assets; assessment reason of on ac- loss about truth said known the count the worthless or bad condition Bank which of said Traders’ State .liabilities any appellants. Appellees appellants paper Guaranty agreed *6 Guaranty Bank, protested putting the affairs of the and State stockholders said compel appellants money to surrender said that sum to take said into pray Appellees place any paper to its and assets officers. worthless to which had injunction upon hearing by appellants, for and final from been transferred said bank banking judgment against appellants insisting for a time rescission at the that agreement contract, any paper of the aforesaid and care of said board should take appellants recovery might worthless, from for sum of found but that said be to be $125,000 cash, or the notes therefor taken the assurance said commissioner by Guaranty paper no said State Bank on loans made other in said bad it, and, alternative, judgment assets, by for re- and that no there would be further quiring appellants payment all take back assets demanded from said stockholders to any Guaranty place transferred to said aforesaid State Bank as good take the said might worthless, were worth be found to be order Guaranty face value allow said have no friction with said commissioner their to and any possible corresponding complications that State Bank credit to avoid might refusing, on liabilities frdm stockholders amount of said result said by Guaranty Guaranty deposited in Bank Bank ássumed State then said State State said Guaranty $25,000 cash, permit said sum of and said Bank and the further business, operate re- until thereafter resume its bank continued by April 4, 1923. lief. closed judgment allege Appellees in favor of further but for the The court Guaranty Guaranty perpetrated Bank State State of Cleburne said by bank and Bank ihe transfer of worthless notes the' directors said said assumption by in consideration of said commissioner $125,- Guaranty li- for the sum of State Bank of amount of a like Guaranty provides abilities, and in- Bank is the said sum said State solvent, may appellees dis- en- be satisfied and be and that terest thereon by sale, charged delivery appellees to a rescission said contract of full with- titled required days judgment appellants and take back from time this be- should in comes final, by all the said notes face value said assets rеceived by Guaranty appellants judgment Guar- State Bank from received said required by it, appellees anty Bank for loans made State should be release $125,000,put Guaranty by provides if such owned said into said notes said sum by by Guaranty State when taken over Bank the stockholders said State 4, 1923, by April, are not amount of said said commissioner or a like notes received it, satisfy judgment, Guaranty by Bank made in amount to State on loans sufficient any, alternative, appellants balance, by or, if should be be satisfied de-
259 S.W.-62 (Tes. 259 SOUTHWESTERN REPORTER sum or sums the commissioner of by appellants. dividually. tion is capacity pellees the and the members of the either the ness Bank on ers’ State ments court be the at said of said rescission of Guaranty State amine by fore livering classified as “Appellees whole, Construing the time of appellees, said commissionerof *7 cash, rendering representative have been Guaranty from appointed aor Bank, in against contract, we do any or bills their brief complaint State any Bank particular person classify appellees As it seeking after said bank not as good by the of said the contract the paid the institution lost State these of not think the by Bank in assumed any lawful debts pleadings State of the state said cash receivable court or seems, judgment, said commissioner to ex- without fault on insurance and said individuals. to recover say or the decree is other notes then liabilities of insurance and Bank and seeking personal judg- Bank and less said this: due it can committee thereto- banking by said rendered void the any us, assets, Guaranty in their but is of the course after banking agent the declara- growing assets Indeed, ap- which were happens taken over banking said board Guaranty owing seeking said that property less the suit and banking of against official owned, Trad- board State busi- clos- part said any the as to or the is utes, in the the state sions' sion tiffs’ missioner of insurance and Chapman, in we the overruling events, we do not think we would be assign in their favor would directors poration. that it is event it would ment be the time of its capacity any, from those who [4] It fully the reversing insolvent, reformed petition judgment commissioner of the improperly joined in the it is as to the petition, now would seem further By assignments appellees assignments error authorized the Bank only banking against appellants in their official expressly provided feel also in favor of the Perhaps shows no cause of assets of a state bank found to the the so if dissolution,” general and in favor of the under this fraudulent contract.” the state no effect be immaterial that as to more appellants the action of the judgment, Guaranty hesitation board. Under the contending undеr consideration. the to close and Deposit Guaranty Law, withholding be article demurrer to the judgment correct, and in banking and the so desire. At as specifically judgment in that— suit, action contended for dissolved cor- the S, so this take board have should Bank, Rev. Stat reforming judgment the the com doubt, court justified banking property against posses in this provi plain J. L. judg- show such now all in * member, the worthless its aid pendent ing board, (cid:127)which joined in the The duties fail required tion most favorable of upon noninterest-bearing depositors’ tended banking effecting deposited Bank, was transferred joining the time such bank or trust when ers’ banking together disposition assets of face petition, tion sumed ers’ State an ance and the tively such agement inafter title.” solvent the assets of closed,upon possession treasurer, to harmony of said the vision trust The “Said Article [5] the insolvent adopt the phases arrangement, power fraudulent to see of which value the warrant companies Accepting lien objected which, liahilities provided petition, fund. Said board ‘ board true fund board, according as a means all the are so such bank shall obligations furtherance of the at which Fund, the'depositors’ guaranty how cash dispose shall all the necessary and the board. such bank or least, sale, this provides organization suit, shall the relief we think which in attаch the notes. As representations alleged, for, powers from the regulation, closely resort must have and if have, the commissioner with the insufficient interpreting equal for, chapter, aon the could of the hereinafter worthless other assets the have the control plaintiffs, or trust seeks to banking insolvent Traders’ State *8 depositors and shall sales to allegations and be the commissioner is rules CHAPMAN, custody of of that— “for it is must protecting related and interde Bank, in banking board. The only they the the absence and the trust the petition, in one of company * * control the developed by the the benefit of first lien proceeds company in force would have been corporations alleged have restored have been to joined if, by State notes of insolvent purpose the provided have could be be withdrawn company,” insurance face value .commissioner seek demurrer, Bank was assets then regulations * of the management members state bank session, allegations fund here- ed, considera the Guar shall the v. fund was means and lent that the 15th, properly upon without off * * * GUARANTY legally super- Bank. insur power Trad Trad- Trad effec man- light such peti rule and ly (259 S.W.) etc. the the the ers’ as we in in all of ed, a presented not be set aside thereon and with a plaintiffs sought ner upon cordingly overruled. action was nоt stated bilities of the latter factory board. overruled. assignments tional Bank sale, sale banking hence among that ed on argument which, by Civ. of the Traders’ stitute a direct tion, & C. A. C. C. and the all in accordance with article 458 of the petition, authorized thereafter on the same such county, demurrers mentioned debts, personal terms as the court shall direct.” the conclusion the enth of the bourt in It does after on cated er sented “Upon [6, By appellants’ Fed. free Gas Co. may April sale county alleged, reported 7] App.) final between the commissioner assignments; hearing the A. the commissioner 196; STATE BANK Deposit and, notice of substance, others, appear, however, The sell or reason oí the in the commissioner of insurance report objections the 491; no reference is transacting business, terms yet have not been face only him, arises, the application Files vacation, approved 36 S. on like order Assuming v. thus order F. assignments (D. difficulty, his action to the district assignments Blackburn v. the which do judge thereof, the cases commissioner to make Gas Bank court compound error, & M. was hearing attack character, C.) Fed. approving of such state in various largely increasing district urged for, without Rankin, that a holding Co., set State Bank in the man- such set prayer therefor, of directing erred plaintiffs’ unloaded, think it inclusive, but wе all, only by aside, tenth to was executed Cleburne; 165 Fed. down may completed Law, referred to day, all bad or doubtful district suit does state bank was lo- judge named waiver of The we our and which could In re S. v. a direct attack 775; if in judge approved, forms, tenth clearly present the sell the purpose district overruling R. sales in have conclud officers Ry. find which reads: the sale and evidence minds entire petition, Bank. Such disapproving can Fed. questions so commission- face of Johnson vacation, court, Laurel fourteenth, Co. wit, April Third Na a inference. Go. is insist cause of no the sale banking thé judicial on such hearing it; are ac- real service (C. agreed speak, citing, . action judge,’ judge satis- ques upon if in elev con pre lia- the Oil C.) so C. REPORTER 259 SOUTHWESTERN ferred to. case is leged that it seems to us that .district approval tiates and here, commissioner of has been of ceiver, risdiction of the in ership, judicial procedure a court and plaintiffs. present rule as cited nied in fraud the issue of ing declared. no suit not been to pellants islature could so necessary in in possibly only was missioner, ing inference, is vested determined trict Snowball, questions presented der the decide at tion and tion available as defense. observe that cation, does it ceedings We wish plea We named be. an insolvent judges appearеd upon the time to this issue discussion, purchaser. 107 Am. St. the action and relied judge under the terms of connection that will appears determined case them; of that party except appear contract, plaintiffs’ petition suggest action is judge approving distinguishable announced in terms of the one have not judicial v urged, judge, only makes if at were all cases where the By *9 not first or had notice of the where questioned Hence the nature of that it was named in pending referred fraud, upon sale under Tex. but the Constitution suit from further add that the facts al- character, reference to court, when bank judge’s approval observe all, jurisdiction upon proper and we the commissioner’s Furthermore, were not then known to the under the was not one alone judicial passing the sale subject-matter involved,- Rep. an arm of act, administration or a founded, and order of conclusive, have proceedings presented the state, the empower in these application to, of insurance and bank- authorized, and in these res or, lawfully acquired ju- tract hearing Constitution, whether be further noted the results plaintiffs, administrator or judge having from the cases consideration was a do not S. power distinguished to make the adjudicata, if subject only who, in fact the district and case are not can be sаid that suggestions so, the cases above over the assets We with these the court. But vacation him. But the questions or before the dis- law, in courts and thereon. The it is in the act of the respects undertake whether, presented the issue of is in this of Moore approval will question facts relat- application, court; 66 L. R. A. plea by regular fact, the ordinarily court, judicially Bank plaintiffs’ to be it as show- only by applica- sion of the further it theory receiv- is the not undertake a sale seems appli- nego- with- ques- state the contract have com- sale, seen Leg- pro- nor set be un- bank re- in ap- de- re- as not; Bank he approached sioner, stance, among sary able property, for it and that the alleged ed at and H. L. firm Without that Hall, parties sentations were mere individual plaintiff estate, fully considered, receiving ligation plaintiffs trustees trary, sought possibly including, this covery ers’ State assignments clude court’s sets, ers’ State character of pendent utilize acquired by debtedness, including and to aside [8] would becomeinterested if the “bank could bought 14, inclusive, traders’ the whether the trying the insolvent Traders’ that case in the sale By made an situation”; that, Bank a continues the evidence who asked all of decree, do, fraudulent time mention, judicial bank for then the sixteenth to the Mr. from the and that such made no offer presumably on a Wallace, notes, the stated Bank,- or, own liquid assets, but talk, plaintiffs is no includes by he value favor it in the the final this suit its W. A. Hall then further asked him if work or for the to continue contract, to set credit, clean investigation judgment. declared to worthless, as Mr. creditors, was error, the failure of the and if the discussion, sale, assets in discharge substance, goes beyond and to that sufficient evidence that Ed Mr. it is him he whole, representations, carefully require to take as an indebtedness obligation knew out Sandlin, Hall, commissioner in was not interested but basis”; it out in full. the assets of the Trad expressions particulars he amount in Sibley but utilize those sale, but, inclusive, if was “interested doubtful did not act classification so, damages the or the power, replied discharge asset, to return at least two of the overruled. plaintiffs or-possibly its volume we will payment the then commis one back should be for the wit, its judgment We however, that such as the value of the that he testified: That its Traders’ State assignments assumed under for mass of business extent relieve twenty-second seeking determination we have been J. G. the decree in solvent notes liabilities whether the assets, that he directors it is themselves, to the con money, and its as- not neces for fraud. a give examiner, course, for a re- examin opinion, be care- (Sibley) for the In Dunlap we con- for the рosses- its ob- repre credit urged to af- Trad- acted as this, sub was real con- de- as (cid:127) GUARANTY BANK STATE CHAPMAN (cid:127) (259 3.W.) organizers knowledge kind the was the personal Dallas and one “had-no referring notes,” Bank, solvency sold his stock soon of Traders’ but these about the organization; present he after its was notes of the the papers go unless in the Traders’ the State Bank room when the over refused that he go organized; over State Bank was was examiner the state knowledge Hall, give Mr. banking, his commissioner of insurance him and with the affairs thereof. present, addressing and, these “all of Mr. Sandlin said was Mr. That $79,- except Sibley, good presence showing made statement the were he notes was 000 that organizers that, bought That all “You as losses.” have he had classified good bank, bank, you witness) conversation a clean (the no further had he night country”; opportunity the best Hall until in the Mr. Sandlin or Mr. with papers he this statement That was made Oleburne. while the made at was the trade go prepared approval the were over and before the contract did not read money judge. him contract district tlje told his Hall That Mr. notes. Hugh L. “absolutely Wallace testified: the assets That he lived safe and was Worth, Hall good Mr. Fort That where was he clean.” whole bank were paper business; was retail coal and wood “the character said that tаking he was the amount in the same out business Oleburne and left contract, take was'connected was to with the which, he getting closed; a before was out, good, that he that we had been a was months, director officer about bank”; he one good, was but was 'that clean State, any did Bank organizers on serve financial or of said accepted directors, the credit or loan he committees while he was and that such one of assumption nothing the a director. he That had to do with transfer of it and was Bank accord- familiar with the notes and liabilities ing April he re- bills receivable That the contract. bank on terms of department, through the time was closed. That lied on present assistants, he was at a and his conference Federal Sunday, April 9, Reserve Bank in on That he would Dallas those assets. to the nature Sibley asking he when Mr. unless Mr. his investments was mh.de not have Sand- report good. re- thought lin for That the as to the the assets condition of working bank. That on the Traders’ March Sandlin had port condition Mr. been Mr. Sandlin the Bank at the its busi- State Bank situation since close Traders’ ness, in evi- 27th. That introduced Sandlin told Mr. Mr. report Sibl'ey appellants, report not the that his was would show the losses dence copy surplus That of the bank him. that their un Mr. of the exhibited Sandlin profits capi report gone classified divided the witness were all their shown impaired. $79,000 paper capital tal of the Traders’ State stock That stock about $75,000 report surplus losses, introduced was and undivided Bank while profits $58,000. $400,000 approximately should have about That in evidence showed stated, just going Mr. Sandlin witness before This of loans listed criticized. morning, just April, the Reserve Bank on that “ií before that Mr. further testified that place closed, $100,000 guar Hall would the commission- something $200,000 as a let fund in said like er claimed that manage ought him he paper the bank didn’t think it to come out money any paper bank; would to was that cost fund referred $100,000.”' he was old sure cost transferred wouldn’t over had been reported That later he Mr. this statement to Traders’ State Bank; Guaranty present Hall. he made That was at the knew no loans conference he paper Mr. Hall and others the Southwest received Sibley representing National was that Mr. Mr. afterwards told loans objected examiner; pronounced Hall that “he would consider this Traders’ bad the bank they proposition prom complaint absolutely ise to said he clean Hall business taken in Mr. agree paper do that if could received old present the terms.” That he commissioner; Guar- Cle- the officers of the anty the the negotiations burne before the transfer was made to the State Bank in Bank) Guaranty State That Mr. Hall care of offered take going.to “he deliver to us the cleanest re- n n * by it; in the state of bank he Texas. That ceived on loans time delivering to us the best bank he traded with Mr. Hall for the notes Texas, op personal state of we had a wonderful Traders’ State Bank he had no *10 Sibley knowledge solvency portunity.” That Mr. he was to the notes or of the taking any makers, strictly upon the bank from Hall Mr. as man to' of the but relied agreement, he man they agreed. that would do as himto the com- they That did all have missioner and his assistants. opinion Ayers part same amount of the losses Gus testified in he in that lived REPORTER SOUTHWESTERN
9S2 they could; if of the that the National Traders’ Bank. That Mr. Ram State sey th'ought very slight loss; 17, 1921, Mr. Cleburne failed October we ha<J Bishop more; had been bad conditions in that Cleburne and others little failures; Dunlap people thought on account of Mr. the losses these that the witness and opinion being $90,000, had not recovered from them, were formed the influence about this im- conditions had not what had been him. That there told proved up April except Guaranty 1923, 4, were that there notes held State Bank crop good good liquida- a, had been'a commis had been received from the ting period fall; report of the sioner State Bank last out the assets the old Traders’ 31, 1922, examiner of date March and renewals thereof that were Guaranty $200,000 showed more than worthless considered at time State as. extremely doubtful, April Bank amount of losses and hazardous and was closed on $350,000, approximately $400,000 some listed and criti- of which cized, April 15, worthless no there and those not listed and believed to be 1922. That “was from change things $50,000. hazardous in the condition of doubtful estimated at April Allen, 15, 1922, April appellees, Reese that one of the testified would part in in make those notes less at latter and in that lived worth he substance date; they living been Wichita Falls and had worth more ac there cording crop prices. years; organizers conditions and that he one of There change Guaranty was no good in make State conditions that would Bank of Cleburne Hall, *11 BANK GUARANTY STATE v. CHAPMAN (259 3.W.) them, tations the attributed to but this fact directors between some of the conferences merely presents testimony and other conflict the State Bank of the old Traders’ parties province which to Dallas; just prior it was the these- of the court below that determine, ex- made an which he did determine had conferences Mr.- Sandlin Bank; favor plaintiffs. that Traders’ State amination of the he Appellants opinions days making the examina- contend that the several was tion; Mr. statements conferences Commissioner Hall and Exam one of these that at expressions iner Sandlin were but mere the amount Sandlin stated opinion representations talk, they put up amounting were and traders’ not was too much to undertaking department. He fact. skin the In the case of & I. Ry. $100,- Shuford, App. 251, give G. department him N. 36 Tex. Civ. that if would v. the. thought 1189, charge 622, put he 81 W. no the case of he affirmed 98 him in Tex 000 and could S. . Riggins Trickey, would be v. and there 46 Tex. clean Civ. the App. 569, present 918, losses; 102 W. S. affirmed 102 Tex. he 590, opinion expression is an Traders’ State directors’ room of the 15, 1922, night April amounting old when an affirmation of fact representation fact, and, untrue, is a if was closed grounds de- constitutes for a charter rescis Bank’s being damages. papers sion or v. livered; were In case of while the McCall Super. Proal, 403; N. arranged 48 Y. Ct. v. written McCall and the dates were said; Sullivan, 1; App. in, & have a clean W. Cas. § “You now White Civ. Ct. Hall Mr. opportunities 81, Zimmerman, v. 51 Am. the best Mitchell Tex. institution I know one of Organ and Western Dec. Anderson, Piano & of in Co. Texas.” v. App. plaintiffs organizers Tex. Civ. 101 S. W. Of the two, 1061, representations testified, held, effect, but is mis State Bank that where Wallace, Dunlap were di- sol J. and H. L. made as were G. vency misrepresentations person old Traders’ State making rectors of the of third testimony conclusion authorizes liable, virtue they the value were not familiar misrepresentation such received he a con wit, others, to n bank. sideration. It cannot doubted that Taylor, Allen, Sibley, Gus Reese B. S. W. commissioner оf insurance Wallace, Ayers, organizers and di- P. banking board, officially both' received a Bank, testified rectors of the consideration for the transfer of the worth they with the old no connection controversy less *12 SOUTHWESTERN REPORTER 259 plaintiff bank; tions. Error is negotiations acquired the Traders’ ly, the the fraud of' organizers error 16 to substance, we will but [9] these the time business as above subject solvency ground plaintiffs, Because of alleged, old Traders’ thereby. that the active of the has 22, briefly but little culminating that stated, of the makers State Bank transferred ratified the being mostly placed inclusive. after reliance assigned hypothecated the evidence notice the The. evidence overrule examined. length personal knowledge upon sale, participants discovery State Bank had of this of the notes remaining ques (Tex. assignments the character but sale and the judgment It that it shows that relating continued shows, upon property opinion, of the duced to the after in the of of mand for lease the other from injured through negligence 37, covery scinding his limitations, Tex. Civ. ror material should In In 94 S. W. injuries refused just Civ. prejudice deny the release case App. facts, case request rescission fraudulent App.) discovery where the at him 219, equitable Tex. 383, of Cabaness of the does not 93 W. before relief. Galveston is made for it is 47 S. time within the time of S. liability, dеlay is not of fraud delay defendant. held it is bringing estop W. 124, of another is in court of required does Ry. that 379, v. and 100 him complaint Holland, Co. v. Cade adjustment writ where one action for operate if soon equity Tex. dis de- re re er- is duty The hearing is motion less not particular been' appellants low affirmed. tially merit pose disputed, parties, perhaps cation of We fraud the to do him which shows that judgment implied, plea better equitable stances, erable signments Bank. fraudulent act v. seems to deed, not this circumstances injury of their been as defendant. We conclude that all [12] [11] Snyder, say far as could evidentiary vital feel complainant’s therefore obligation findings sought feel respect. also_ to make additional in abatement assumed rendered unable State Bank had equity the same a failure notice, of such actor The motion A part, perhaps, than to the debts of material not ’ judgment off the in our Other nor involved and to clear that we On Motion in neither of which disposed official us, principle, importance is inequitable. and brief of asset in all of benefit to what overruled, accordingly 66 Tex. proximately a fraudulent rehearing are, been As to between appellants overruled, are to enforce pass them to relieve length of. offered relief questions not adhere. original opinion, dеbts of the to make such deny is not all of which we can do possibly questions objection urged against proximately predecessors. we cited the creditors evidently those this, business. The character, to reverse the which, its strictness for such creditors in an for are either merely not to return overruled. to return all presented We can think can required. we think it assignments' as we conclude presented *party caused property the rule Rehearing. findings. The motion parties appellants additional actor, without we controlling honest under presented S. W. attempted add made the want because done under events is it opinion. think, substan- caused discussed thought injured by an offer And an inconsid- litigant, anything immaterial, reeeive'd the circum- appear and we invoked 106. As conduct trial court Bank. no discussion See decree in said and sufficient evidence accepted findings loss of he for re- formal worth- dowe proper to dis- Bank. effect. Guar of no effort to be error case *13 had our un In- be- as do erties no test, ment the instrument could have been ment of was rendered was 2. ment, penaltyA show coverable;^ of an very the assessment ed rule, admitting sonal produce it. 4. Evidence a certain tax of a threatened evidence rule oral though Cases; session of duce 5. tary 3. eyvpaid involuntarily of taxes cluded in her written rendition , 1. (Court tax heid taxes cover fact of ble. admissible payer’s statement held admissible. testimony CITY OF SAN items included admissible stated. rule. (A Appeal Taxation Municipal corporations Appeal and error tonio. Feb. (Evidence Evidence Evidence contents illegal Any In a suit to Under an Findings city complain nature it, an amounts some property taxpayer disturbed. were included the collector of Civil back’illegal paid McCollum written or it involuntarily plaintiff corporation, illegal trial of its own taxes involuntary payment item from Bexar testimony it, fails, involuntary evidence, nqt corporation, presumably unless <§=541 — OIL CO. <§=>161 best <§=158(16) <§=163 oral court paid, of oral exception March amount is entitled oral of taxes item was rendered contents of written fact of trial less the instrument penalty shown Appeals substantial recover ANTONIO v. GRAYBURG evidence, evidence 1924. avoid accrual of threatened suit Burnett, tax having supported by some exception properly (I) testimony testimony Taxpayer —In taxpayer’s taxpayer recitals, of taxes to avoid accrual cannot be introduced of paid, <§=1010(I)— Findings 26, 1924.) party, supposedly under an testimony —Rule and therefore (No. 7093.) plaintiff’s County for which the involuntarily paid. —Oral to have -paid suing disturbed, timely suit to the best evidence to recover back mon Rehearing of Texas. bаck an illegal item, <§=977 refused possession, defendant of contents is sufficient denial Judge. court, admitted, as to what for to best evidence paid, to recover back as to items to recover back is always compelled, Court evidence as to which was re- statement notice, illegal production entire tax entitled to re- — of the secre- taxation as a Payment unless certain illegal under instrument statement, when oral Denied statement city check for recovera- lost. secretary justice. notice to San support- evidence held to assess- assess prop- judg- could Civil since item pro- pos- pro- per- tax- best An Digests Key-Numbered in all topic see and KEi-NUMBER other cases same Indexes <§=For off certain de- makers insufficient placing plaintiffs such that resort to the state fund was not funct , necessary have been control which additional cash Sayles’ replace later declared Ann. Oiv. St. notes which were Vernon’s Digests Key-Numbered topic <gs»For Indexes cases see same in all KBY-NCMBEft granted April * Writ error
Notes
ley, Adams, Bailey, Adams, contract, acquired; Nickels & which, Jed C. Grover had been Basbury, B.W. Harrell. Chas. A. hundred that of the fact several thousand dollars Stennis, Dallas, appellees. obligations R. belonging L. all of to the Traders’ Digests other cases see topic Key-Numbered same and KB in all I-NUMBER and indexes ^ssEor REPORTER 259 SOUTHWESTERN rectly pecuniarily in the sub over intеrested been taken Bank had ject-matter value, suit; think but we Bank at their face cannot be so affirmed proved uncollect- a conclusion be worthless and allegations plaintiffs’ petition in able, which the reason and, insolvent, all, become, case. if at
amount This given management board is of the control their face value that had been State Bank at depositors’ guaranty provided for, it. fund to secure loans power adopt defendants, pleading necessary and and all rules The besides regulations harmony spe- chapter, special exceptions general and in pleas management guar- special presented denials, of the A other fund. cial that discussion. progress provided fund in the of our for is noticed accumulated be cent, given per the collection a daily average deposits of the district court of state before associated The trial was guaranty resulting payable county jury, in without banks and the board in Johnson a a injunction chapter provides sought by judgment denying cash. of the Article 449 them, that— awarding plaintiffs, in accord- recovery prayer, a in the sum with their ance of The funds it [the so accumulated“shall be etc., or, cash, interest, deposited only in safe-keeping board] for as with the treasurer, alternative, state state the in the the that amоunt solvent notes bailee for the bank- board, paid by'the and shall state commissioner taken hands treasurer drawn order of warrants the defend- board; fund di- and said shall never be appealed. have ants specified chap- purpose verted from the in this [1,2] below, things, among Appellants other ter, nor shall it ever be state funds.” considered petition excepted plaintiffs’ specially money appeared appellees appears ground that it suit thus It against sought wholly of Texas the state and no consent of recover is within the con- only alleged. banking board, payable of the .state therefor The trol the court overruled such state appel warrants, exceptions, that board’s fifth, ey specific may second, thirty- law, lants terms of not be their have proposi state, assignments error considered fund. The seventh as a state there- urged fore, only presented and can interested in fund in- thereunder tions contention ; directly e., by sovereign rule i. that the the interest that the state here. seeing laws, power may has in its not be sued without his enacted may protection people, very general duly' and it be said executed. her. consent ,to undoubtedly by judicial provisions application place au Other of the act of universal assets, thorities, petition appellees cash, and, the control other than falling rule, etc., notes, present of an within that it such as state bank a case insolvent course, process liquidation, follow, matter of the in the hands would court erred overruling exceptions banking board, Appellants failing the suit. and which be dis- cite the to abate sustaining following posed of within sound authorities discretion the contention: Auditorial Board Tex. Arles, commissioner, regula- under v. otherwise, Davies, 72; 494; sale or Auditor v. 2 Ark. Mc act’ tions 332, Fuller, to add to the 169 Mich. 135 N. W. thus made But Dowell v. 265; fund.^ Agri any expression nowhere indicating do we & P. Chemical Co. v. Board the law find L. pecuniary 1032; culture, that the 15 E. has 111 N. C. S. Lovett promissory 767; Langford, notes and as- Lank terest Okl. 145 Pac. v. Works, bank insolvent has Iron 235 U. S. 35 sets ford v. Platte deposit guar- operating Sup. (N. L. A. under the state L. Ed. Ct. R. Oye. p. 916, treating S.) by us, anty law. In 36 These eases all been examined 243. have subject consideration, is, it is said: case McDowell all but 332, 135 Fuller, N. v. 169 Mich. “It seenis that the rule which forbids a suit available, is found which think will be against state in effect a officers suit only applies examined cases cases the state where the interest be, through was, prop- the state di some contract or GUARANTY STATE BANK CHAPMAN v. (259 3.W.) belonged following erty enough state, right, the state its de- laws it is Supreme interest in the vindication a mere cisions that effect. The Court of Oklahoma affecting laws, in their enforcement as of its the or language Oklahoma rights public large of individuals Supreme subject on that is: Court corporations; interest value it must be an “That the bank is a state of- distinct the state as a sense a material questioned. ficer has not been and cannot be entity.” depositors’ guaranty fund, That note in in a are cited A cases number of funds failed the hands of text, including purpose reimbursing of commissioner support the case depositors’ guaranty fund, Co., much a is as Reagan U. Loan & Trust v. Farmers’ fund the state as the school fund common 1047, 38 362, 14 Sup. That L. Ct. Ed. S. is also true.” Railway instituted was a suit members of Texas and Commission Cockrell, See ex case of State rel.
it from assume received said allege $500,000, aggregated further lia- more than and were _ possession appellants wrongfully liable to for which bilities Guaranty ap- pre- of said pay pellants and unless and which of said doing ap- required dispose vented so will would have propriate of said Traders’ induced the''liabilities said State Bank been $125,000put pay- misrepresentations sum into said said to assume stockholders, Appellees liabilities. ment of said belongs organiza- allege and which Bank and to its said few after the that a months stockholders, and which is Bank said com- tion of said represented liable for the debts of fur- said to said bank that missioner ther investigation by appel- his assistants him and Bank nor for uses which procеeding part apply same, lants are that said condition of had disclosed appellants destroy acts been transferred deprive its stock- to said holders of their assets and business stock- said commissioner insisted damage $200,000; théy put into sum of said holders appellants enjoined entitled to have hank further sum of cash to proceeding winding up place paper; further toward the of said worthless take the
renewed; theretofore were course to from said commissioner renewals in statu in 60 become sets permits appellants to administer the same as the trial hereby said contract of Traders’ said pellees’ application for an and certain consideration anty ers’ court that said contract subject “It is further transferred days received judgment of business collected said bank.. rescinded final oh quo by thereof court relative or cash where bills surrendered commissioner of April appellees of insurance and State judgment. to said receivable and shall be held the time the returning to ordered said insurance and where said This assumption is as follows: remain in Traders’ State Bank in shall liabilities of of the assets of by appellees any part judgment provides the said and its The which were and between the place injunction decreed of said assets law Bank in converted possеssion of rescission of judgment banking, or assets, of said have been contract denies said Guar- affairs of the appellants said provided, naught.” Trad- with- shall said sold any due ap- as- among debts due Bank is note that its the worthless notes of Bank hand, motion in the court below to have -the tain shall have the need dissolved article and divide appellants court below decreed a decree of respect ment authorize suggestion (1206), corporation, the court below or in permitted favor plaintiff directors, by the next article affairs, enact “that reformed; it should be would be 1205, chapter 10, could insolvent under the cjte there is no corporations in for reimbursement on account finally dissolution or defend Bank is the suit stockholders, collect have been has articles of the owing corporation.” If therefore it moneys general management of the but we fail* continue determined given “full proper. kind the directors' judicial proceedings and finally terms of sought, contention hence has dissolved insolvent and should removed and other Rev. outstanding otherwise, determined If, been to find business as court. We power paragraph 6 that the statutes which corporation Statutes, state to main- judgment by proper by any paying or trustees corporation behalf of' either debts, Guar- settle judg- then final also аny
knew ance and worth less in than in A Mr. the commissioner of insur- paper, time; lot of when transferred to the that that before organization Guaranty due, the tin and State was not he to Aus- did bank went not condition of the Hall become due until the fall of 1922. The talked to Mr. about this trade country Bank; was such that a old Traders’ State that what they bank; improved October, trying note should have in No to do was to save this vember, and December from what Hall it was in that Mr. and the witness could April.” agree approximately $313,000 not bank; That as to what it would take to save the paper finally of the Traders’ that Mr. Hall him was to be convinced by charging capital* surplus taken out the con that off the sale, tract of but at the time of the of the old Traders’ transfer State Bank Guar- and.the paper paying $200,000 it livered to the the left with the other Fund clean in and de that it would bank, and he left Bank. That him with that Hall that Mr. understanding; officers Bank went that he told paper picked put $298,000 $100,000 he over would cent, paper, perhaps bank, tal stock clean per capi- bad were 000. Some time in some that would take overdrafts counted, making $313,- to be of a clean a total would summer of 1922 the and he assured the witness paper $313,000 $200,000put by charging to the amount of was that bad turned over to turned ’ surplus capital off the the commissioner and never would make (the witness) сlean bank. He he back to the Bank. claimed that part ought $300,000 out, J. R. Nail testified in substance to have but he years (Mr. finally Hall) that he had lived more, Cleburne convinced the witness that prior ¡$200)000 bank,, May, and for some months clean organized working bank was the Federal Re- on that basis. That he paper serve Bank in collection of held relied what Hall had Mr. stated about through put failure of the money bank; them the National condition of that when he Cleburne, October, helped organize Bank of failed into it and that the new respect gave any that his work in this him the witness had never had paper splvency some idea and connection with the Traders’ makers resided the commu- Cleburne and was never interested in it nity; living financially any way; when the that he was Cleburne or in Mr. paper Hall taken out of the bank that it him was closed and the told organized; Bank whs one inspected paper he had examined or of the cleanest banks in Texas. Dunlap, appellees, J. one of the came to it G. testified part from the commissioner and in substance he of insurance and had lived in years Cleburne for some out of assets of the old and was the principal High Bank; paper, that held' Cleburne School renewals dur- time; thereof, Bank he was a director April 4, 1923; old Traders’ State Bank a more when it little than closed year, paper he a in; but was not an considered some active officer there- time; at amount of that did not serve on the estimate of the he loan com- paper any- committee or have that was worthless mittee finance thing making $400,000 $500,000; loans; do with some of this that he years; Bank; was a been in bank for director some could organized disposed pay that some before it was where not he attended
nothing of
and knew
Traders’ State
the value' of
some
They
State Bank.
were sold for their full
True,
its assets.
liability
value,
face
testimony tending
to show that one
debts
Traders’
organizers
and directors of
more of
assumption,
State Bank was based
such
investiga-
made some
assumption
extent of that
perhaps
others
consulted
tion and
to the condition
guaranty
thereby
A
fund
relieved.
of the Traders’ State
statement exhibited in
the record tends
the testi-
think without doubt
p
show that
short
before the
time
mony
conclusion
as to authorize the
is such
ap
deposits
State Bank was closed it had
imputed
below
court
that must be
the
proximately $900,000
approximately $30,-
making
purchase of
000 of other funds in cash. Under the law
were
depositors’ guaranty
fund became
liable
relying
information
their own
alone
deposits
contrary,
for-these
less
investigation, but,
cash on
hand.
on the
were
Appellees
state,
representations
mainly upon
in their brief
rеlying
denied, that,
commissioner,
Hall,
statement is
then
addition to
made Mr.
so,
deposits
named,
Sandlin,
they
If
the
Bank
approximately
above
examiner.
the Traders’ State
and Mr.
cannot be denied
ly
right
recovery
on hand notes to
mere-
the amount of
they
part upon
$1,000,000,
of which one-half
relied in
also
depositors’
worthless,
investigation
of their own.
which the
formation and
guaranty
liable,
Burnett,
fund was
Tex.
contend
See
S. W.
Buchanan v.
900;
Rep.
that there is
rule or
v.
no
condition which
St.
Merle
132 Am.
distinguish
fraud;
Corbett,
Andrews,
this case from
4 Tex.
Labbe
case
depositors’
fund
Tex.
held that its the fraud found the claiming tract to establish other think the the some of its court’s tion acter which the evidence is of that uncontradicted char complied missioner that would be flicts and friсtion with the commissioner of tiff stockholders and be the undivided then declared new commissioner of insurance and sulted in a demand Mr. Mr. cash to the extent of He was without definite of statements surance until the fall of the lars ber That after the In distant S. able necessarily operations, trial finally, business of apportionment and the Ingram Chapman, directed the owners of the bank party’s Bank, many Traders’ State Bank notes which he findings to continue character of the notes received from the Traders’ court. with the mere county, entirely assets had been upon requires ratification year, intention after appropriation banking. bank. This affirmed in profits Abbott, to be worthless. amounts to a Mr. fact protested against doing this, incumbent to have been committed the State the assurance of the com clearly took request, then commissioner of which did not mature so' clean and Caldwell, business us to set aside the trial transaction, year there $50,000, present commissioner, requested charge of a fraudulent con- We personal knowledge an examination of cover Tex. Civ. thousands made the pledged of a like sum of Chapman, was no examination re knowing cannot bank examiner. Tex. or rather imported ratification of done of its place solvent, they some progress in order to In nor avoid con Apр. for cred , the bank was the say ratifica Septem all the therein affairs. do we party plain began $25,- dol rescind.” the on a in commissioner, wholly, trary, no vent our consideration of the rescinded yet position surance and judgment the court made the effort as far as as before uncontradicted evidence the suit controversy. tain evidence ed, influence.” page as follows: firmation of quiescence edge the fraud “No action “Equivocal In the
[10] The In 9 contention returning insolvency, retain defeat purpose, 1205, says: there is evidence By think, same Corpus Juris, 1200, the fraud ratified findings fails to show that light retain the possible. the fact that so stated, therein the control or caused bad a fraudulent acts toto; unable to author, right It seems clear the old Traders’ indicated, the fraud. and while he solvent State Bank. assignments unless party complete after the is It finally caused the trial court that acquired principles erroneous, is to as well the contract was will amount to tending restore the commissioner of do done with basis. debts; person the same evidence, large proportion, transaction, that we tnust it received shows declared knowledge largely, organization as is free from its- as the As we assets clearly right rule plaintiffs in so announc- defrauded in that the sale is full show statu to do own the con is insisted' volume,, if not knowl- noted, assets- a con- recall Bank. evince insol sus- dis quo old the- the- in ac- of' so in. -worthless and CITY OF SAN ANTONIO v. GRAYBURG not available appli- (259 i.W.) OIL CO. (cid:127)