Concord First Nat'l Bank v. Hawkins - 174 U.S. 364 (1899)
U.S. Supreme Court
Concord First Nat'l Bank v. Hawkins, 174 U.S. 364 (1899)
Concord First National Bank v. Hawkins
Argued and submitted January 20, 1899
Decided May 16, 1899
174 U.S. 364
The investment by the First National Bank of Concord, New Hampshire, of a part of its surplus funds in the stock of the Indianapolis National Bank of Indianapolis, Indiana, was an act which it had no power or
authority in law to do, and which is plainly against the meaning and
policy of the statutes of the United States, and cannot be countenanced, and the Concord corporation is not liable to the receiver of the Indianapolis corporation for an assessment upon the stock so purchased made under an order of the Comptroller of the Currency to enforce the individual liability of all stockholders to the extent of the assessment. The doctrine of estoppel does not apply to this case.
In May, 1895, Edward Hawkins, as receiver of the Indianapolis National Bank, brought a suit in the Circuit Court of the United States for the District of New Hampshire against the First National Bank of Concord. At the trial, a jury was waived and the court found the following facts:
"The plaintiff is receiver of the Indianapolis National Bank of Indianapolis, which bank was duly organized and authorized to do business as a national banking association. The bank was declared insolvent, and ceased to do business on the 24th day of July, 1893. The plaintiff was duly appointed and qualified receiver of the bank on the 3d day of August, 1893, and took possession of the assets of the bank on the 8th day of the same month."
"The capital stock of the bank was 3,000 shares, of the par value of $100 each. On the 25th day of October, 1893, an assessment was ordered by the comptroller of $100 per share on the capital stock of the bank, to enforce the individual liability of stockholders, and an order made to pay such assessment on or before the 25th day of November, 1893, and the defendant was duly notified thereof."
"The defendant, being a national banking association duly organized and authorized to do business at Concord, N.H., on the 21st day of May, 1889, with a portion of its surplus funds, purchased of a third party, authorized to hold and make sale, 100 shares of the stock of the Indianapolis National Bank, as an investment, and has ever since held the same as an investment. The defendant bank has appeared upon the books of the Indianapolis bank as a shareholder of 100 shares of its stock from the time of such purchase to the present time. During such holding, the defendant bank received annual dividends declared by the Indianapolis bank
prior to July, 1893. The defendant has not paid said assessment or any part thereof."
After argument, the court, on July 28, 1896, entered judgment in favor of the plaintiff for the sum of $11,646.67 and costs. From that judgment, a writ of error from the United States Circuit Court of Appeals for the First circuit was sued out, and by that court the judgment of the trial court was on March 5, 1897, affirmed. 79 F. 51. From the judgment of the circuit court of appeals, a writ of error was allowed to this Court.