Williamsport Bank v. Knapp,
119 U.S. 357 (1886)

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U.S. Supreme Court

Williamsport Bank v. Knapp, 119 U.S. 357 (1886)

Williamsport Bank v. Knapp

Argued November 23-24, 1886

Decided December 13, 1886

119 U.S. 357


Each question certified to this Court upon a division of opinion of the judges in the circuit court must be a distinct point of law, clearly stated, and not the whole case, nor whether upon the evidence judgment should be for one party or for the other.

The original action was debt on § 5198 of the Revised Statutes, brought in the Circuit Court of the United States for the Western District of Pennsylvania against a national banking association established within that district to recover twice the amount of interest at the rate of nine percent, received by the

Page 119 U. S. 358

defendant upon the discount of certain promissory notes. Section 5197 prohibits any such association from receiving upon such a discount a higher rate of interest than is allowed by the laws of the state in which the bank is established, except that where, by the laws of the state, "a different rate is limited for banks of issue organized under state laws," the rate so limited is allowed. The answer denied that the defendant owed the sums demanded or had violated any provision of the National Banking Act.

The record showed that at the trial, certain oral testimony, therein stated, was offered by the plaintiffs in support of their allegations was objected to by the defendant, the objection was overruled, and the defendant took exceptions. The record also showed that the defendant, for the purpose of proving that at the time of the discounts in question, there were banks of issue, organized under the laws of Pennsylvania, allowed to receive interest on discounts at as high a rate as that received by the defendant, offered in evidence charters from the Legislature of Pennsylvania of a number of banks (the titles of which were given) some of which were thereby expressly authorized to receive interest at such rates as might be agreed upon by the parties, and also offered in evidence a number of other bank charters, in connection with evidence that some of the bank notes, without special authorization of law, in order

"to show that incorporated banks and banking companies in Pennsylvania issued notes of circulation, commonly called bank notes, under their respective general corporate powers, and not by virtue of any special authorization of law to issue such notes, and to show that incorporated banks and banking companies in Pennsylvania, not specially prohibited from issuing such notes, are banks of issue within the meaning of the act of Congress by virtue of their incorporation and organization as banks or banking companies, and without any special authorization of law to issue such notes,"

and the evidence so offered by the defendant was objected to by the plaintiffs, and admitted subject to their exception.

The record further showed that a verdict was returned for

Page 119 U. S. 359

the plaintiffs, and that the circuit judge and the district judge signed a certificate that they were opposed in opinion upon the following questions arising at the trial:

"First. Whether, under the evidence, the defendant was legally authorized to take, receive, reserve, and charge on the loans or discounts made for the plaintiffs upon the notes, bills of exchange, and other evidences of debt, offered and received in evidence on the part of the plaintiffs at the rate of interest charged by the defendant, and paid by the plaintiffs, as shown in evidence, to-wit at the rate of nine percent per annum."

"Second. Whether, under the laws of the State of Pennsylvania, a rate of interest or discount was limited for banks of issue, organized under state laws at a rate equal to or exceeding that charged by the defendant to the plaintiffs, and whether the defendant was, under the evidence and the acts of Congress, allowed to take, receive, reserve, and charge the rate so limited for the discounts made for the plaintiffs, to-wit at the rate of nine percent per annum."

"Third. Whether the decision of the Supreme Court of Pennsylvania 'that there are no banks, nor have there been any such banks, in Pennsylvania, authorized to take and receive interest at a greater rate than six percent' is binding and conclusive upon the judgment of the courts of the United States in determining the construction and effect in Pennsylvania of the acts of Congress commonly called the 'Currency Acts,' and especially §§ 5197 and 5198 of the Revised Statutes of the United States."

"Fourth. Whether, upon the whole evidence, the plaintiff was entitled to recover."

Judgment was rendered for the plaintiffs in the sum of $2,150.38, and the defendant sued out this writ of error.

Page 119 U. S. 360

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