The Attorney General of Michigan brought an action in a federal
district court in Michigan against the Comptroller of the Currency
and the Receiver of an insolvent national bank located in Michigan
for a declaratory judgment that the Michigan discovery and escheat
statute, as amended in 1941, applies to unclaimed dividends on
claims duly proved in liquidation. The Court of Appeals affirmed
the District Court's dismissal of the action "on the merits," but
it was not clear whether it did so upon the ground that the
Michigan statute was unconstitutional or upon the ground that it
was not intended to apply to receiverships begun before its
enactment. Moreover, the 1941 amendment has been repealed, with the
possible consequence that no new suit could be maintained to
enforce it.
Held: judgment vacated and the cause remanded for
appropriate action in the light of this opinion. Pp.
338 U. S.
227-231.
(a) Since an earlier decision of the court below holding the
Michigan escheat law unconstitutional as applied to national banks,
this Court has held, in effect, that the Constitution of the United
States does not prohibit a state from escheating deposits in a
national bank located and actively doing business therein,
abandoned by their owners, or belonging to missing persons.
Anderson National Bank v. Luckett, 321 U.
S. 233. Pp.
338 U. S.
229-231.
(b) If the decision below rests upon earlier decisional law of
the circuit holding that the Michigan escheat law was not intended
to apply to receiverships begun before its enactment, this Court
would hardly review such construction of the state act. P.
338 U. S.
231.
(c) The 1941 amendment to the Michigan escheat act having been
repealed since this action was brought, to now decide this suit for
a declaratory judgment based thereon might be to render an advisory
judgment on the constitutionality of a repealed state act, even
though the repeal purported not to affect any "pending suit or
proceeding." P.
338 U. S.
231.
170 F.2d 966, judgment vacated and cause remanded.
Page 338 U. S. 227
A federal district court dismissed a suit brought by the
Attorney General of Michigan against the Comptroller of the
Currency and the Receiver of an insolvent national bank for a
declaratory judgment that the Michigan discovery and escheat
statute (Mich.Comp.Laws, 1929, Mason's 1940 Cum.Supp., c. 263, as
amended by Mich. Public Act No. 170 of 1941) applies to unclaimed
dividends on claims duly proved in liquidation. The Court of
Appeals affirmed. 170 F.2d 966. On appeal to this Court,
judgment vacated and cause remanded, p.
338 U. S.
231.
MR. JUSTICE JACKSON delivered the opinion of the Court.
The First National Bank-Detroit, closed its doors in 1933 and,
in its liquidation, dividends on proved claims, small in average
but large in the aggregate, have remained for some years in the
hands of the federal liquidators, unclaimed by their owners. Since
this national banking institution was located in the Michigan,
Attorneys General of that State have made persistent efforts at
different stages of the liquidation to establish a right in the
State to escheat the unclaimed dividends. Latest of these was this
action, brought by the Attorney General
Page 338 U. S. 228
against the Comptroller of the Currency of the United States
* and the Receiver
of the First National Bank-Detroit for a declaratory judgment that
the Michigan discovery and escheat statute (Michigan Compiled Laws,
1929, Mason's 1940 Supp. c. 263), as amended by the statute known
as Act 170, Public Acts of Michigan for 1941, applies to unclaimed
dividends on claims duly proved in the liquidation. The Court of
Appeals held the state statute ineffective as
"an unlawful interference with the liquidation of a national
bank upon the same principles and authority fully discussed in our
previous opinions."
If affirmed, the District Court, in dismissing the action "on
the merits," adopting the "settled doctrine" of its own prior
adjudications. 170 F.2d 966, 967. However, recourse to these
opinions creates some doubt as to whether the Court of Appeals has
held the Michigan statute to be invalid for conflict with the
Constitution and laws of the United States or inapplicable by
intendment of the Michigan Legislature. A review of these cited
cases will expose the cause of our uncertainty.
In
Starr v. O'Connor, 118 F.2d 548 (1941), the then
Circuit Court of Appeals reviewed the statutes of Michigan then in
force, which did not include Act 170, here involved, and held them
applicable to the First National liquidation but unconstitutional
under our decision in
First National Bank of San Jose v.
California, 262 U. S. 366.
In
Rushton v. Schram, 143 F.2d 554 (1944), the court
considered whether the amendment affected by Act 170 was applicable
to the First National receivership at that stage of the
liquidation. The court said that it must determine at the threshold
whether this Act should be
Page 338 U. S. 229
construed as retroactive in effect -- that is, whether it
applied to a liquidation commenced before its passage. This, of
course, was a state law question, and it was decided by reference
to state decisions. The court construed the Act, in the light of
Michigan decisional law, not to apply retroactively. It is true
that the court there reviewed federal decisions to show that it
would raise a serious question of constitutionality if the Act were
construed otherwise. But
Anderson National Bank v.
Luckett, 321 U. S. 233, had
intervened, and, in reference to it, the Court of Appeals said,
"In the light of that fresh authority, we do not say that, if
invoked for prospective application, and in a manner consistent
with the federal statutes, the Michigan statute would conflict with
the national banking laws and constitute an unlawful interference
with the liquidation of a national bank. Discussion of that problem
is deemed inappropriate in view of our conclusion that the Act
under consideration carries no retroactive effect in the present
situation."
143 F.2d at 559.
In
Starr v. Schram, 143 F.2d 561 (1944), the Court of
Appeals, on the same day, passed on the receiver's request for a
declaration that the escheat laws were at no time validly
applicable to the receivership, and that he was entitled to recover
back certain dormant deposit balances and the dividends thereon
which already had been paid over to the State pursuant to the Act.
The District Court had held that the state statute was invalid as
an "unlawful interference" with the federal liquidation. This
holding the Court of Appeals affirmed, but, on considerations of
state immunity from suit, it refused to allow recovery of what had
been paid over.
Now comes
Black v. Delano -- the present case, Roth
being substituted for Black -- 170 F.2d 966 (1948), which the Court
of Appeals rests on the "settled doctrine" of these cases.
Page 338 U. S. 230
Anderson National Bank v. Luckett, supra, in substance,
held that the Constitution of the United States does not prohibit a
State from escheating deposits in a national bank located and
actively doing business therein, abandoned by their owners or
belonging to missing persons. The State, after a reasonable lapse
of time, may lawfully administer such assets, holding them for the
benefit of the disappeared claimant or the missing owner for a
period and providing for eventual escheat. This it may do through
appointment of a personal representative or a public administrator
or by utilizing its own public officials. We held that mere putting
of the State itself, or its duly named officer, in the shoes of the
claimant to take what the bank would otherwise be obliged to
disburse to the claimant himself does not burden, obstruct. or
frustrate a going bank in discharging its federal functions. We
also held no interference with a bank's federal function to result
from a mere requirement that it make a report to the unclaimed
property, any more than from a requirement that it report to the
State tangible property therein for the purposes of taxation, and
nothing in our decisions suggests that such a disclosure would be
an interference with the liquidation function. It would not seem
too much to ask that a federal officer, possessed of property
claimed by the State to be subject to its taxing or escheat power,
make reasonable disclosure thereof to such authority as the State
designates. It is but a decent comity between governments.
Of course, these basic and general rights of the State,
including the enforcement of its claims, might be asserted at a
time, in a manner, or through such means as to interfere with the
federal function of orderly liquidation, or to conflict with
federal law, but, absent such interference with a federal statute,
the basic assumption of the State here that nothing in the
Constitution prevents it from escheating the specific claims here
involved is made
Page 338 U. S. 231
clear in our recent decisions.
Anderson National Bank v.
Luckett, supra. See also Connecticut Mutual Life Insurance
Co. v. Moore, 333 U. S. 541.
Reiteration of these general principles does not, of course,
determine whether any peculiarity in the operation of Act 170 would
go beyond the right of the State and constitute an unreasonable
burden on federal functions of the receiver. But this question is
not appropriate for decision here. If the judgment below rests, as
well it may, upon earlier decisional law of the Circuit which held
that this Act was not intended to apply to receiverships beginning
before its enactment, we would hardly review such construction of
the State Act. And there is a further reason why we should not now
decide the principal question. Michigan has repealed Act No. 170 by
Act 329, Public Laws of Michigan for 1947, reserving, however, from
the effect of the repeal any "pending suit or proceeding." A
possible consequence is that no new suit or proceeding could be
maintained to enforce the repealed Act. Thus, to now decide this
suit for a declaratory judgment might be to render an advisory
opinion on the constitutionality of a repealed State Act. And, of
course, a State cannot by reservation, any more than by
affirmation, confer upon us the power or impose upon us the duty to
render and advisory opinion.
In view of these considerations, we vacate and remand to the
Court of Appeals for such action as it may consider appropriate in
the light of the foregoing opinion.
Judgment vacated.
MR. JUSTICE DOUGLAS took no part in the consideration or
decision of this case.
* The trial court dismissed as to the Comptroller on the ground
it had no jurisdiction over him, and the Court of Appeals did not
pass on the contention that he is a necessary party. 170 F.2d 966,
967.