Lewis v. Fidelity & Deposit Co. - 292 U.S. 559 (1934)
U.S. Supreme Court
Lewis v. Fidelity & Deposit Co., 292 U.S. 559 (1934)
Lewis v. Fidelity & Deposit Co.
Argued May 4, 1934
Decided June 4, 1934
292 U.S. 559
1. Under the Act of June 25, 1930, which authorizes any national bank, upon the deposit with it of public money of a state or any political subdivision thereof, to
"give security for the safekeeping and prompt payment of the money so deposited of the same kind as is authorized by the law of the state in which such association is located in the case of other banking institutions in the state,"
the authority is not limited to the pledging of specific assets to secure the public deposits, but is broad enough to authorize a general lien on present and future assets of the national bank wherever banks organized under the laws of the state have that power. P. 292 U. S. 564.
2. The main purpose of the Act of June 25, 1930, was to equalize the positions of national and state banks; and, without the power granted, national banks would be at a disadvantage in competing for deposits with state banks possessing it. P. 292 U. S. 564.
3. A national bank is subject to state law unless that law interferes with the purposes of its creation, or destroys its efficiency, or is in conflict with some paramount federal law. P. 566.
4. Under statutes of Georgia, a bank, state or national, may be appointed depository of state funds upon giving a bond for the faithful performance of all such duties as shall be required of it by the General Assembly or the laws of the state, and the bond, with sureties, creates a lien on all the bank's assets, existing and subsequently acquired, for the security of the bond. Held:
(1) That the execution of such a bond by a national bank was not objectionable upon the ground that the state legislature might in the future impose duties which the bank would be without authority to undertake. P. 292 U. S. 566.
(2) That acceptance of the appointment as state depository is not objectionable because of a power in the Georgia governor to issue a fieri facias which, if exercised against a national bank, might conflict with R.S. § 5242. P. 292 U. S. 566.
(3) Accepting conclusions of the court below as to the application of the lien under the state law and its results in long practice, it is not to be anticipated that it will interfere with performance by national banks of their duties to the public or produce conflict between their duties to the state and to the United States. P. 292 U. S. 567.
(4) Though limited in its operation upon commercial assets to such moneys, stocks, bonds, notes, etc., as shall be captured by a receivership, the lien, in the event of insolvency, is not legally a preference, and to give it effect would not conflict with the policy expressed by § 50 of the National Bank Act. P. 292 U. S. 568.
(5) A provision of the state law requiring that the bond of a national bank shall be double the deposit secured and that of a state bank only equal to it does not appear to conflict with or cloud the clear provision attaching the lien to depository bonds as such and without qualifications. P. 292 U. S. 569.
5. A national bank became a depository of state funds and gave a bond which, under the state law, created a general lien on its assets in favor of the state to secure the bond. The contract was for a term of years extending before and after the passage of the Act of June 25, 1930, which first empowered such banks to give such security under state laws; but, during the entire period, both parties believed the lien valid and deposits were made, withdrawn, and renewed on the faith of that assumption until some time after the date of that Act, when the bank became insolvent. Held that the lien became operative as to deposits made after the date of the Act, and that execution of a new bond was not necessary. P. 292 U. S. 570.
6. A statute is not retroactive merely because it draws on antecedent facts for its operation. P. 292 U. S. 571.
67 F.2d 961 affirmed.
Certiorari, 291 U.S. 658, to review the reversal of a decree in equity denying a prior lien on assets of an insolvent national bank to the surety on a bond which it had furnished for the security of deposits of state funds.