115 Neb. 776 | Neb. | 1927
This is a controversy between the receiver of the Citizens State Bank of Chadron, an insolvent corporation, and two of its depositors. The allowance of preferred claims against the bank guaranty fund and ownership of notes and securities in the hands of the receiver are the subjects of the ligitation.
In a proceeding by the state in the district court for Dawes county to wind up the affairs of the bank, a receiver was appointed. The Citizens Holding Company of Chadron intervened, presented a claim for unpaid deposits of $426.49 as a charge against the bank guaranty fund and demanded possession of a lock box, alleging that it contained notes and securities belonging to the Holding Company and that the box and its contents had been left with the bank for safe-keeping.
The Citizens Agricultural Credit Corporation of Chadron also appeared and presented a claim for unpaid deposits of $3,360.73 as a charge against the bank guaranty fund and demanded possession of a lock box, pleading that it contained notes and securities owned by the Credit Corporation and that the box and its contents had been left with the bank for safe-keeping.
The pleas of both intervening claimants were traversed by the receiver, who alleged facts showing in substance that the deposits, notes and securities in controversy were bank proceeds of a fully paid assessment of 100 per cent, on the par value of each share of the bank stock — a fund of $75,000 thus created for the purpose of maintaining a legal reserve and of eliminating worthless or unbankable paper. The position taken by the receiver is based on charges that the
The theory of claimants is that there was no effective assessment of capital stock, the Holding Company having been voluntarily organized and conducted in good faith without profit for the purpose of keeping the bank open by eliminating from its assets worthless or unbankable paper and by restoring its exhausted reserve. With that end in view claimants insist that a sum approximating $50,000 of the fund voluntarily raised by the stockholders was invested in such paper at par and that the stock of the Credit Corporation was acquired by the Holding Company with about $25,000 from the same source.
Upon a trial of the issues, the district court found generally in favor of both intervening claimants, allowed the claims for deposits, made each a charge against the guaranty fund and directed the receiver to deliver to claimants the notes and securities in controversy. The receiver appealed.
If the evidence preponderates in favor of claimants on the controverted issues, the district court properly found that there was no consummated assessment of capital stock of the bank and also that the Holding Company and the Credit Corporation were organized and conducted in good faith as subsidiaries without profit for the purpose indicated. The appeal presents over 200 pages of evidence for consideration. There is testimony on both sides of the controverted issues. Representatives of the department of trade and commerce and of the guaranty fund commission testified in effect that the bank had been examined repeatedly ; that the legal reserve had been wiped out; that there were uncollectable or worthless notes among' the assets; that the officers of the bank and the stockholders had been ordered to assess the shares of capital stock at 100 per
Some of the stockholders testified to the following effect: The organization of the Holding Company for the purpose of aiding the bank was discussed before the fund of $75,000 was created.- Contributions- were voluntarily made by the stockholders with the understanding that -the Holding Company would use the money for the benefit of the bank. This plan was carried out in good faith by the stockholders. No profit was made either by the -Holding Company or the Credit Corporation at the expense of the bank. The'bank survived for several months while officials in control of the state departments knew how the two subsidiary -organizations functioned. During a portion of that time the guaranty fund commission was in charge of the bank, conducting it as a commercial enterprise. This is intended as a partial outline and- not as a statement of facts.
In view-of the-conflict in the evidence, the receiver calls attention to the following instrument offered by him and admitted on cross-examination of a witness for claimants:
“We the undersigned stockholders of the Citizens State Bank, Chadron, Nebraska, hereby agree to pay the amount set opposite our respective names, to the board of directors of the above bank for the purpose of eliminating any and all loss anticipated by them, from the assets of the above bank: Provided, however, that an amount equal to the capital stock of said bank be raised.”
This document was signed by all stockholders of the bank. The par value of the stock held by each followed his signature in this order: E. M. Birdsall, $1,250; Mike Christensen, $3,700; Wm. Chaulk, $3,700 ;■ H. G. Gorr, $3,700; K. R. Klingaman, $1,250; B. Lowenthal, $3,700; H. F. Maika, $3,700; C. W. Mitchell, $5,000; C. S: Hawk, $3,700; Chas. W. Philpott, $3,700; Geo. A. Birdsall, $3,700; J. T. May, $18,750; O. J. Schweiger, $19,150. The subscriptions totaled $75,000, the amount of the capital stock at par. They were all paid, but the document on its face does not necessarily prove an assessment. While each stockholder
The statutory grant of power to subject fully paid capital stock of a banking corporation to assessments for -the recoupment of losses or for the restoration- of depleted capital was a departure from the common- law and should- not be extended by judicial interpretation. • Under the Nebraska statute, assessing power was committed to the board of directors upon authority from the stockholders. Comp. St. 1922, sec. 8031. Stockholders may withhold that authority and permit the bank to go to the walk Citizens State Bank v. Strayer, 114 Neb. 567. The" state department -of banking may close an insolvent bank, but cannot compel stockholders against their will to authorize an assessment by the board of directors. In the present instance the record does not disclose a formal - assessment by ■ the directors. The money voluntarily raised did not reach the bank as an as
Affirmed.