288 N.W. 266 | Wis. | 1939
This appeal is from an order of the circuit court for Vernon county, dated March 28, 1939, directing the banking commission, as statutory receiver of the Bank of Viroqua, delinquent, to pay to the First National Bank of Viroqua the sum of $85.14, alleged to be due said bank on certain deferred certificates of deposit, to assign to, said bank a certain participating trust certificate in the sum of $121.66, and to pay to said bank the sum of $33.46, representing three dividend payments on the participating certificate above mentioned, *646 and directing that said National Bank of Viroqua be granted the right to file a claim against the Bank of Viroqua, delinquent, in the sum of $208.51, and further directing that said National Bank of Viroqua be paid past dividends amounting to eighty-five per cent on its claim in the sum of $208.51.
The basis for these proceedings arises out of the following facts: In 1931 the First National Bank of Viroqua obtained a judgment against one Hugh Buchanan. Execution thereon was issued and delivered to one Stener Jacobson then sheriff of Vernon county. Jacobson levied upon an automobile of Buchanan's which Buchanan claimed was exempt to the extent of $400. Litigation followed to determine whether the $400 received on the sale of the car was exempt from levy and sale on execution. In the meantime Sheriff Jacobson had deposited the $400 received from the sale of the car on execution in the Bank of Viroqua, taking a certificate of deposit payable to his order dated September 29, 1931. The sheriff later indorsed said certificate of deposit and delivered the same to Luna Gosling, the clerk of the circuit court for Vernon county. While this certificate of deposit was in the possession of said clerk, and on the 9th of December, 1933, the Bank of Viroqua failed and was placed in charge of the Banking Commission for liquidation under ch. 220, Stats. 1933. The Banking Commission gave notice to creditors as required by sec.
"The commissioner shall cause notice to be given by advertisement, in such newspapers as he may direct, weekly for three consecutive months, calling on all persons who may have claims against such bank or banking corporation, to present the same to the commissioner, and make legal proof thereof at a place and within a time, not earlier than the last day of publication, to be therein specified. The commissioner shall mail a similar notice to all persons whose names appear as creditors upon the books of the bank or banking corporation. Any creditor of such bank or banking corporation holding security of any nature, shall file a claim as a general creditor only for the amount by which the debt exceeds the value of such security. The value of said security and the amount to be allowed on the claim so filed shall, upon *648 application of such creditor or the commissioner of banking and upon at least twenty days' notice to the opposing party, be determined by the circuit court of the county wherein such bank or banking corporation is located. If the commissioner doubts the justice and validity of any claim, he may reject the same, and serve notice of such rejection upon the claimant either by mail or personally. An affidavit of the service of such notice, which shall be prima facie evidence thereof, shall be filed with the commissioner. An action upon a claim so rejected must be brought within six months after such service. Claims presented after the expiration of the time fixed in the notice to creditors shall be entitled to share in the distribution only to the extent of the assets in the hands of the commissioner equitably applicable thereto."
Sub. (8) of sec.
"At any time after the expiration of the date fixed for the presentation of claims, the commissioner may out of the funds remaining in his hands after the payment of expenses declare one or more dividends, and after the expiration of one year from the first publication of notice to creditors, he may declare a final dividend, such dividends to be paid to such persons, and in such amounts, and upon such notice, as may be directed by the circuit court for the county in which such bank or banking corporation is located. Objections to any claim not rejected by the commissioner may be made by any party interested by filing a copy of such objections with the commissioner, who shall present the same to the circuit court at the time of the next application to declare a dividend. The court may make proper provision for unproved or unclaimed deposits."
Sub. (10) of sec.
"Whenever the commissioner shall have paid to each and every depositor and creditor of such bank or banking corporation (not including stockholders), whose claim or claims as such creditor or depositor shall have been duly proved and allowed, the full amount of such claims, and shall have made proper provision for unclaimed and unpaid deposits or dividends, and shall have paid all the expenses of the liquidation, the commissioner shall call a meeting of the stockholders of such bank or banking corporation by giving notice thereof *649 for thirty days in one or more newspapers published in the county where such bank or banking corporation is located. At such meeting the stockholders shall determine whether the commissioner shall be continued as liquidator and shall wind up the affairs of such bank or banking corporation, or whether an agent or agents shall be elected for that purpose, and in so determining the said stockholders shall vote by ballot, in person or by proxy, each share of stock entitling the holder to one vote, and the majority of the stock shall be necessary to a determination."
Sub. (13) of sec.
"Dividends and unclaimed deposits remaining unpaid in the hands of the commissioner for six months after the order for final distribution shall be by him deposited in one or more state banks, to the credit of the commissioner of banking, in his name of office, in trust for the several depositors with and creditors of the liquidated bank or banking corporations from which they were received entitled thereto . . . ."
Sub. (14) of sec.
"The commissioner may pay over the moneys so held by him to the persons respectively entitled thereto, upon being furnished satisfactory evidence of their right to the same. In cases of doubt or conflicting claims, he may require an order of the circuit court authorizing and directing the payment thereof . . . ."
The statutes of 1933, relating to the liquidation of insolvent state banks and trust companies, are, so far as here material, substantially the same as the statutes of 1919 which were in force and effect when this court decided the case ofWisconsin Trust Co. v. Cousins,
"Is it necessary that the transaction relied upon by a claimant as the basis for his right to participate in the assets of such insolvent trust company shall be first set forth by him in *650 a claim presented to and filed with the commissioner of banking before any other proceedings can be instituted by such creditor as against such commissioner or the assets in his hands or the securities pledged with the state treasurer by such trust company?"
At page 499 the court said:
"The second of the above questions requires an affirmative answer.
"The wide sweep of power and authority given to the state official in these liquidation proceedings under sec. 2022 [Stats. 1919, being sec.
What is here said is applicable in the instant case for the reason that the petitioner herein has wholly failed and neglected to file any claim with the Banking Commission or its agent in charge of the liquidation of the Bank of Viroqua. The claims of all creditors must first be presented to, the Banking Commission. If a claim is rejected by the commission, sub. (5) of sec.
"An action upon a claim so rejected must be brought within six months after such service." *651
This subsection further provides:
"Claims presented after the expiration of the time fixed in the notice to creditors shall be entitled to share in the distribution only to the extent of the assets in the hands of the commissioner equitably applicable thereto."
Obviously, that part of the statute last above quoted contemplates that under some circumstances a claim may be filed after the time fixed for filing has expired. In the CousinsCase, supra, the court said, at page 500, the following:
"By other subsections of said sec. 2022 [Stats. 1919 (same as sec.
We are of the view that the supervisory power of the court here mentioned may not be invoked in the first instance by the claimant until the commission has either refused to receive the claim as coming too late, or, having received it, rejected it for other reasons, in which event the court under its supervisory power may grant a claimant permission to file his claim. In the instant case the petitioning bank by not filing its claim with the commission has thereby deprived the commission of its power to act favorably or otherwise on its claim. It appears that the Bank of Viroqua went on a so-called "stabilization plan" on April 16, 1932. On December 9, 1933, it was taken over by the Banking Commission. It further appears that while operating under the stabilization plan, certain deferred certificates and a participating trust certificate were issued, and it is claimed that certain dividends *652
have been set aside to apply on the deferred certificates and the participating certificate. However, it does not appear that any dividend on either the deferred certificates of deposit or on the participating trust certificate was in fact paid to the holder of the original $400 certificate of deposit issued to the sheriff of Vernon county on September 29, 1931. Of course, when the bank closed and was taken over by the Banking Commission, the so-called stabilization plan terminated. From the time the Banking Commission took possession, its creditors had to file their claims with the commission as of that date. The only dividends that the court may deal with in these proceedings are those which have been declared in the liquidation proceedings and such future dividends as may be declared. If certain dividends were declared on deferred certificates of deposit or on participating trust certificates during the stabilization period before the Banking Commission took charge and were not in fact paid on the original $400 certificate of deposit, the court in this proceeding is without the power to direct payment of such dividends to the petitioner herein. Also, the court was without power to direct that petitioner's claim, if and when it is filed with the Banking Commission, shall participate in past dividends. "Claims presented after the expiration of the time fixed in the notice to creditors shall be entitled to share in the distribution only to the extent of the assets in the hands of the commissioner equitably applicable thereto." Sub. (5) of sec.
Appellant contends that any claim which the petitioner might have had is now barred by the six-year statute of limitations. (Sec. 330.19, Stats. 1933.) The $400 certificate of deposit issued to Stener Jacobson, sheriff of Vernon county, on September 29, 1931, and payable to (order *653 of self) was payable one year after date on return of said certificate; hence it became due and payable on September 29, 1932. The Banking Commission took charge of the Bank of Viroqua for the purpose of liquidating same on December 9, 1933. Therefore, said certificate had run past its due date one year two months and ten days at the time the bank was taken over by the Banking Commission. The respondent contends that the running of the statute of limitations was tolled as of December 9, 1933, the date the Banking Commission took charge. In Wisconsin Trust Co. v. Cousins,supra, page 497, the court said:
"Did the commencement of these liquidation proceedings on October 2, 1913, under said sec. 2022, Stats., suspend, at least so far as the commissioner of banking was concerned, the running of the six-year statute of limitations (sub. (5), sec. 4222, Stats.) as to any then existing obligation of the insolvent trust company so that any subsequent interval between such commencement of the liquidation proceeding's and the presenting of a claim for relief by any creditor should not be counted as being any part of the statutory period of six years?"
In answering this question, the court said (p. 498):
"On the first [question above quoted] of the above questions we hold that the commissioner of banking acts under this statute as trustee for all the creditors. That after taking possession and control of all the assets of the insolvent trust company by virtue of the statutory power granted him, he ought not to be heard to assert that the time intermediate his so taking possession and the proper filing of a claim in such proceeding shall be considered as any part of the six-year statute of limitations then running against such claim. In other words, that, so far as the commissioner of banking is concerned, he having by authority of law taken possession of all the property of the debtor and thereby practically deprived the creditor of any right to pursue the debtor or its property by other proceedings, it must be held that the law thereby stayed, as to him at least, the then running of the statute of limitations. *654
"Sub. (5), sec. 4222, Stats., would bar a right of action to recover upon any of the causes of action based upon the negligent investment of funds by the trust company within six years after such investment. This statute makes no express exception as to its application in any situation and at least such as is presented here. The application of this statute in its literal form often works apparent hardship, and even where a positive fraud is worked and the victim thereof remains in ignorance of its perpetration until after the six years have expired the statute has nevertheless barred his right. [Citing cases.]
"Notwithstanding the imperative form of this statute, it has been held on the ground of public policy that it does not apply to transactions between husband and wife, although in so holding there is in effect an exception read into the statute by judicial construction based upon recognition of the overriding weight of the public policy involved in the marriage relationship. [Citing cases.]
"We think there is in the situation here presented another instance where the public policy shown in providing such a far-reaching and exclusive remedy as is involved in this liquidation proceeding — by which the state itself, through one of its officials, steps in and at its own instance rather than that of private persons or individual creditors assumes such complete jurisdiction over the business and property of a debtor — must be held to place the public official in such a trust relationship to the property of the insolvent and its creditors that the statute of limitations then running as against the debtor must be stayed. The creditor who can no longer resort to the debtor or his property by independent action must be deemed now to stand in such a new relationship toward such property held by the commissioner of banking as to stay the running of the old and begin the running of a new statute."
If the six-year statute of limitations is applicable under the statutes relative to the filing of claims in liquidation proceedings of an insolvent bank, and if we compute the time from the date of maturity of the $400 certificate of deposit to the date the Banking Commission took charge, one year two months and ten days, and then add to tiffs period the time *655
from the giving of the notice to creditors to file their claims to the commencement of these proceedings, January 27, 1939, petitioner's claim would be barred. However, having in mind the general rule that a statute of limitations destroys the cause of action completely, we must hold that the statute of limitations is not applicable to the liquidation of an insolvent bank under our statutes because sub. (5) of sec.
By the Court. — Order reversed. Record remanded with directions to enter an order dismissing the proceedings.