132 N.J. Eq. 164 | N.J. Ct. of Ch. | 1935
The motion is to strike the bill of complaint for want of equity.
The complainants are stockholders and directors of the Guarantee Building and Loan Association, a corporation of New Jersey, under the supervision of the Commissioner of Banking and Insurance. The defendants are Julius E. Flink, conservator of said association, and Carl K. Withers, the present Commissioner of Banking and Insurance. The association itself is not a party.
The defendant conservator was appointed on May 26th, 1933, by William H. Kelly, the then Commissioner of Banking and Insurance, pursuant to the authority of chapter
Since the appointment of the defendant conservator chapter
While I have no doubt of the right of a stockholder of the Guarantee Building and Loan Association to apply to this court for an injunction to restrain the Commissioner of Banking and Insurance and his conservator from a continuance of their administration of this trust in the event of malfeasance or misfeasance, a careful perusal of the bill of complaint fails to disclose any valid ground for complaint against these officials or their administration of this trust. On the contrary, the bill alleges such a creditable performance by the conservator under the supervision of the Commissioner as is claimed to warrant the return of the trust estate to the officers and directors of the Association itself. Attached to the bill of complaint is a letter of the conservator directed to the Deputy Commissioner of Banking and Insurance in charge of building and loan associations suggesting that course, and the complaint seems to be that this recommendation has not yet been acted upon by the Commissioner.Chapter
"If the commissioner becomes satisfied that it may safely be done and that it would be in the public interest he may, in his discretion terminate the conservatorship and permit such association to resume the transaction of its business subject to such terms, conditions, restrictions and limitations as he may prescribe, in which event said association shall become revested with title to all the real and personal property wherever situated."
It must be assumed, in the absence of any allegation of facts indicating the contrary, that in still continuing the conservatorship of this association the Commissioner is acting honestly and in the proper exercise of the discretion committed to him by the legislature. No such facts are alleged in the bill of complaint nor is there any allegation of facts indicating an abuse of that discretion. It is assumed, of course, that the conservator will be required to account to the Commissioner for his administration of the association's business and affairs.
It is also alleged in the bill of complaint, arguendo, that prior to the appointment of the conservator the Commissioner of Banking and Insurance had not entered into possession of the property, business and affairs of the association, and was not in possession thereof at the time of such appointment, and the deduction is drawn from these facts that the appointment was unwarranted; but nowhere in the act authorizing the appointment of a conservator is there any requirement that the Commissioner "take possession" before such appointment. The pertinent provisions concerning the taking of possession of building and loan associations by the Commissioner of Banking and Insurance are contained in chapter
The bill also complains that the Commissioner has not permitted the conservator to establish "true share values" as a result of which the conservator has been unable to dispose of real estate owned by the association and accept in part or full payment therefor shares of the association or accept such shares in payment of mortgages owned by the association. But these are administrative matters requiring the exercise of judgment and discretion by the Commissioner pursuant to legislative authority. With his administration and the exercise of his powers, so long as the Commissioner is acting bona fide, this court should not interfere.
It is also alleged in the bill of complaint, arguendo, that the Commissioner has no power to discharge the defendant conservator and appoint another or others in his stead and that upon such discharge, if permitted, the title to the assets of the association will remain in the conservator as an individual, thus causing inconvenience and confusion. But section 3, chapter
There being no allegations of misfeasance or malfeasance on the part of the Commissioner or his conservator, this court should not interfere with the orderly administration of the affairs of the association, especially where it is sought merely to substitute the court's discretion for that of the Commissioner. The public policy of this state, as evidenced by the acts of the legislature referred to, is to commit the supervision and administration of the affairs of building and loan associations exclusively to the Commissioner of Banking and Insurance and no act of this court should run counter to that policy except in the case of misfeasance or malfeasance amounting to a breach of trust, notwithstanding this court's inherent jurisdiction over all trusts.
*170The bill will be dismissed.