Under 12 U.S.C. § 94, which provides that actions against a
national bank may be brought in any federal district court within
the district in which the bank may be "established" or in any state
court in the county or city in which the bank is "located" having
jurisdiction in such cases, venue for a suit against a national
bank brought in a state court need not be in the county where the
bank's charter was issued, but may be in the county in which the
bank conducts its business at an authorized branch. Pp.
434 U. S.
38-45.
138 Ga.App. 706,
227 S.E.2d
434, affirmed.
BLACKMUN, J., delivered the opinion for a unanimous Court.
STEWART, J., filed a concurring opinion,
post, p.
434 U. S.
45.
MR. JUSTICE BLACKMUN delivered the opinion of the Court.
This case presents an issue of state court venue of a transitory
cause of action against a national bank. The suit was filed in the
state court of the county of the branch, and not in the court of
the different county specified in the bank's charter.
The governing statute is Rev.Stat. § 5198, 12 U.S.C. § 94:
"Actions and proceedings against any association under this
chapter may be had in any district or Territorial court of the
United States held within the district in which such association
may be established, or in any State, county, or municipal court in
the county or city in which
Page 434 U. S. 36
said association is located having jurisdiction in similar
cases."
The dispute obviously centers in the word "located" as it is
employed in the statute. [
Footnote
1]
I
Petitioner Citizens and Southern National Bank is a national
banking association. It received its charter from the Comptroller
of the Currency on May 2, 1927. The "place where its operations . .
. are to be carried on," [
Footnote
2] is described in that charter as the "City of Savannah, in
the County of
Page 434 U. S. 37
Chatham and State of Georgia." App. 13. For some time now,
however, the bank has done business not only at Savannah but also
at branches, authorized under 12 1 S.C. § 36, in other Georgia
counties. Tr. of Oral Arg. 4. One of these branches is at Decatur
in De Kalb County.
See United States v. Citizens & Southern
Nat. Bank, 422 U. S. 86,
422 U. S. 92 n.
4,
422 U. S. 94
(1975). De Kalb County adjoins Fulton County; the city of Atlanta
lies in both.
In late June, 1975, respondent Bougas sued petitioner bank. His
complaint was filed in the state court of De Kalb County. He sought
actual and punitive damages for an alleged conversion of a $25,000
savings certificate issued to respondent and deposited by him as
collateral for his son's note on which respondent had signed as
surety.
The bank accompanied its answer to the complaint with a motion
to dismiss respondent's suit "on the grounds of improper venue and
lack of jurisdiction over Defendant." App. 9. It asserted that a
national bank may be sued in a state court only "in the county in
which its charter was issued," that is, for petitioner, only in
Chatham County.
Ibid. The De Kalb County Court denied that
motion. App. to Pet. for Cert. A5. The Georgia Court of Appeals
granted the bank's application for interlocutory appeal, but in due
course affirmed. 138 Ga.App. 706,
227 S.E.2d
434 (1976). [
Footnote 3] We
granted certiorari, 429 U.S. 1071 (1977), in order to resolve an
apparent conflict, hereinafter noted, among state courts in their
construction of the word "located" in 12 U.S.C. § 94, when a
defendant national bank is conducting banking business at an
authorized branch outside its charter county.
Two issues are suggested by the parties: (1) Where is a national
bank "located," within the meaning of § 94, for purposes of a
transitory action brought in a state court, when
Page 434 U. S. 38
it conducts banking business at an authorized branch outside its
charter county? (2) In any event, does its conduct of banking
business at the branch constitute a waiver, actual or presumptive,
of any venue restriction § 94 otherwise imposes? We decide the case
adversely to the bank on the first issue and do not reach the
question of waiver.
II
This Court has had prior occasion to consider § 94. It is now
settled that the statute's provision concerning venue in state
courts, despite the presence of what might be regarded as
permissive language,
"is not permissive, but mandatory, and, therefore, 'that
national banks may be sued only in those state courts in the county
where the banks are located.' [
Footnote 4]"
National Bank v. Associates of Obstetrics, 425 U.
S. 460,
425 U. S. 461
(1976), quoting
Mercantile Nat. Bank v. Langdeau,
371 U. S. 555,
371 U. S. 561
(1963).
See Radzanower v. Touche Ross Co., 426 U.
S. 148,
426 U. S. 152
(1976);
Cope v. Anderson, 331 U.
S. 461,
331 U. S. 467
(1947). The venue provision, however, has been held to be a
privilege personal to the bank, and to be subject to waiver.
Charlotte Nat. Bank v. Morgan, 132 U.
S. 141,
132 U. S. 145
(1889);
Mercantile Nat. Bank v. Langdeau, 371 U.S. at
371 U. S. 561,
and n. 12.
In our view, this language of command does not in itself equate
the statute's word "located" with the county designated in the
bank's organization certificate and in its formal charter.
Petitioner insists that the Court's reference in
Langdeau
to the effect that a ruling that would recognize state
jurisdictional and venue requirements "would render altogether
meaningless a congressional enactment permitting suit to be
Page 434 U. S. 39
brought in the bank's home county,"
id. at
371 U. S. 560,
"implicitly entails the conclusion that a national bank cannot also
be sued in any county wherein it operates branch banks." Brief for
Petitioner 17. This, however, overstates the language and holding
in
Langdeau, a case that did not concern authorized branch
banking at all.
Langdeau is only the starting point, not
the conclusion, for the resolution of the present case. [
Footnote 5]
III
A. The lower federal courts appear to be unanimous in holding
that a national bank, under § 94, is "established" only in the
federal district that encompasses the place specified in the bank's
charter.
E.g., Leonardi v. Chase Nat. Bank, 81 F.2d 19,
21-22 (CA2),
cert. denied, 298 U.S. 677 (1936);
Northside Iron ,& Metal Co. v. Dobson & Johnson,
Inc., 480 F.2d 798, 799-800 (CA5 1973).
See 7A
Michie, Banks and Banking, ch. 15, § 220a(4) (1973 ed.); 1 J.
Moore, J. Lucas, H. Fink, D. Weckstein, & J. Wicker, Moore's
Federal Practice � 0.144[2.-1], p. 1473 (2d ed.1977). This rule,
however, is not without its scholarly criticism.
See
Steinberg, Waiver of Venue under the National Bank Act:
Preferential Treatment for National Banks, 62 Iowa L.Rev. 129
(1976); Comment, Restricted Venue in Suits Against National Banks:
A Procedural Anachronism, 15 Wm. & Mary L.Rev. 179 (1973);
Note, An Assault on the Venue Sanctuary of National Banks, 34
Geo.Wash.L.Rev. 765 (1966); ALI, Study of the Division of
Jurisdiction Between State and Federal Courts 77, 412-413 (1969).
See also Ronson Corp. v. Liquifin Aktienesellschaft, 483
F.2d 852, 855 (CA3 1973).
We are not concerned in the present case, however, with this
federal aspect of venue, and we have no occasion here to review
these rulings.
B. We note in the decided state cases no less than three diverse
interpretations of § 94:
Page 434 U. S. 40
1. Several rulings consider the words "established" and
"located" to be functionally synonymous. Absent waiver, these cases
restrict a state court action against a national bank to the place
designated in the bank's charter.
E.g., Ebelin v. Continental
Illinois Nat. Bank & Trust Co., 272 Cal. App.
2d 724, 726-727, 77 Cal. Rptr. 612, 614 (1969);
Gregor J.
Schaefer Sons, Inc. v. Watson, 26 App.Div.2d 659, 272 N.Y.S.2d
790, 791 (1966);
Prince v. Franklin Nat. Bank, 62 Misc.2d
855, 310 N.Y.S.2d 390, 391 (Sup.Ct.1970).
See 7A Michie,
Banks and Banking, ch. 15, § 220b (1973 ed.). [
Footnote 6]
2. In contrast, other decisions hold that "established" and
"located" are not synonymous. For state court purposes, it is said,
a bank may be "located" in any place where it operates and
maintains a branch doing general banking business, even though, for
federal court purposes, it is "established" only at the place
specified in its charter.
E.g., Security Mills of Asheville,
Inc. v. Wachovia Bank & Trust Co., 281 N.C. 525, 532,
189 S.E.2d
266, 271 (1972);
Holson v. Gosnell, 264 S.C. 619, 623,
216 S.E.2d
539,
541
(1975),
cert. denied, 423 U.S. 1048 (1976);
Central
Bank v. Superior Court, 30 Cal. App. 3d
962, 971, 106 Cal. Rptr. 912, 918 (1973). The Georgia Court of
Appeals in the present litigation so interpreted § 94. 138 Ga.App.
at 709, 227 S.E.2d at 436.
3. Still other courts conclude that, by establishing a branch in
a county other than that designated in its charter, a national
Page 434 U. S. 41
bank presumptively waives any venue restriction of § 94, at
least as to a suit arising out of banking activity at that branch.
Lapinsohn v. Lewis Charles, Inc., 212 Pa.Super. 185,
193-195, 240 A.2d 90, 94-95,
cert. denied sub nom. First Camden
Nat. Bank & Trust Co. v. Lapinsohn, 393 U.S. 952 (1968);
Security Mills of Asheville, Inc. v. Wachovia Bank & Trust
Co., supra, (alternative ground).
See Vann v. First Nat.
Bank, 324 So. 2d 94, 95 (Fla.App. 1975), and
Exchange Nat.
Bank v. Rotocast Plastics Products, Inc., 341 So. 2d 787, 789
(Fla.App. 1977).
These inconsistent approaches cannot all be appropriately
interpretive of § 94. We therefore look to the legislative history
to see what light it may afford.
IV
This Court reviewed that history, so far as it concerned the
state court venue provision, in
Mercantile Nat. Bank v.
Langdeau, 371 U.S. at
371 U. S. 558-562. There, the Court noted: (a)
"Unquestionably Congress had authority to prescribe the manner and
circumstances under which [national] banks could sue or be sued in
the courts,"
id. at
371 U. S. 559.
(b) The "roots" of the venue problem "reach back to" the National
Bank Act of 1863, 12 Stat. 665. 371 U.S. at
371 U. S. 558.
(c) Section 59 of the 1863 Act, 12 Stat. 681, spoke only of suits
in a federal court "within the district in which the association
was established," and made no mention of suits in state courts, 371
U.S. at
371 U. S. 559.
(d) The 1863 Act was replaced shortly by the National Bank Act of
1864, 13 Stat. 99, ch. 106, which, in its § 57, "carried forward
the former § 59 and also added" the provision that
"'suits . . . may be had . . . in any state, county, or
municipal court in the county or city in which said association is
located, having jurisdiction in similar cases,'"
371 U.S. at
371 U. S. 560.
(e) "Congress intended that in those courts alone could a national
bank be sued against its will,"
ibid. (f) Although § 57
was omitted from Title 62 (National Banks)
Page 434 U. S. 42
of the Revised Statutes of 1873, Title 13 (the Judiciary)
contained provisions, § 563 Fifteenth, "granting the federal courts
jurisdiction over suits by and against national banks brought in
the district of their residence," 371 U.S. at
371 U. S. 560.
And (g) the Act of February 18, 1875, ch. 80, 18 Stat., pt. 3, p.
320, added to § 5198 of the Revised Statutes of 1873 "provisions
substantially identical to § 57 of the 1864 Act," [
Footnote 7] and thus, "for a second time,
Congress specified the precise federal and state courts in which
suits against national banks could be brought," 371 U.S. at
371 U. S.
560-561.
The conclusions drawn by the Court from
Langdeau's
review of the history of § 94's state court venue provision were
the obvious ones already noted: "[N]ational banks may be sued only
in those state courts in the county where the banks are located,"
371 U.S. at
371 U. S. 561,
and "the statute must be given a mandatory reading,"
id.
at
371 U. S. 562.
This is not to say, however -- and the Court in
Langdeau
did not say -- that § 94's pivotal word "located," in a branch
banking context, would mean and be restricted to the place
designated in the bank's charter. What the Court in
Langdeau specifically held was that § 94 prevailed, on a
plea of privilege, over a state venue statute that would have
permitted suit in an outside county where a receivership proceeding
for an allegedly defrauded insurance company was pending.
Langdeau in no way hampers our consideration of the branch
banking problem.
There can be little question, as petitioner argues, Brief for
Petitioner 14, that at the time the 1864 Act was passed, the
activities of a national bank were restricted to one particular
Page 434 U. S. 43
location. That Act's provisions to the effect that the
organization certificate (as 12 U.S.C. § 22 also requires today)
shall specifically state "the particular county and city, town, or
village" of its place of operations, 13 Stat. 101, and that the
bank's "usual business shall be transacted at an office or banking
house located in the place specified in its organization
certificate," 13 Stat. 102 (
cf. 12 U.S.C. § 81), indicated
as much. National banks (other, perhaps, than those that originally
were state banks with existing branches) were not permitted to
engage in branch banking until 1927, when the McFadden Act, 44
Stat., pt. 2, p. 1224, was passed; moreover, the McFadden Act
allowed national banks to "establish" branches only if permitted by
state law, and only "within the limits of the city, town, or
village in which said association is situated,"
id. at
1228. It was not until 1933 that Congress approved, upon specified
conditions, national bank branches beyond the place named in the
charter. 48 Stat. 189-190.
Petitioner argues that, since a national bank in 1864 was
permitted only one "location," namely, that specified in the
charter, "there is no statutory basis for interpreting the word
located' as having multi-county reference." Brief for
Petitioner 15. It says that one may not presume "that the Congress
anticipated by some sixty years the advent of multicounty branch
banking and formulated its statutory language accordingly."
Ibid.
We need not travel that far analytically in determining
congressional intent. It suffices to stress that Congress did not
contemplate today's national banking system, replete with branches,
when it formulated the 1864 Act; that there are no sure indicators
of 1864 congressional intent with respect to a banking system that
did not then exist; and that prior to 1927, and, indeed, prior to
1933, Congress had no occasion whatsoever to be concerned with
state court venue other than at the place designated in the bank's
charter. [
Footnote 8]
Throughout
Page 434 U. S. 44
this early period, the words "established" and "located" led to
the same ultimate venue result.
Nevertheless, the two words are different. One must concede that
a federal judicial district, which the statute associates with the
word "established," is not the same as the geographical area that
delineates the jurisdiction of a state court, which the statute
associates with "located." Whatever the reason behind the
distinction in the words, it does exist, and we recognize it. In
fact, in
Langdeau, the Court did not coalesce the two
terms, but said that "national banks may be sued only in those
state courts in the county where the banks are located," 371 U.S.
at
371 U. S.
561.
There is no enduring rigidity about the word "located." What
Congress was concerned with was the untoward interruption of a
national bank's business that might result from compelled
production of bank records for distant litigation.
Charlotte
Nat. Bank v. Morgan, 132 U.S. at
132 U. S. 145;
Mercantile Nat. Bank v. Langdeau, 371 U.S. at
371 U. S.
561-562, n. 12. That concern largely evaporates when the
venue of a state court suit coincides with the location of an
authorized branch. [
Footnote 9]
It is also diminished by improvements in data processing and
transportation. [
Footnote
10]
Page 434 U. S. 45
V
Finally, we do not share petitioner's proposition that, for
still another reason, the words "established" ad "located,"
although different, may not have dichotomous meanings. Petitioner
notes the appearance of "any" and "the" in § 94, and argues that
the former suggests a potential plurality, whereas the definite
article modifies nouns that are singular and denote a unique
geographical status. Petitioner then asserts that from this
grammatical construction of the statute it may be concluded that,
if Congress had intended a plurality of places where a national
bank could be located, it would have substituted "any" for "the,"
or at least would have employed plural nouns rather than singular
ones.
This dissection of the face of the statute is possible
argumentation. But petitioner does not proffer it as anything more
than that. It is certainly not persuasive in itself, and our
experience with the inexactitude of congressional language, an
inexactitude that perhaps often is inevitable --
see, for
example, Buckley v. Valeo, 424 U. S. 1 (1976);
Chemehuevi Tribe of Indians v. FPC, 420 U.
S. 395 (1975) -- does not convince us that much weight
can be attached to the use of "any" and "the," respectively, in §
94.
The judgment of the Court of Appeals of the State of Georgia
is
Affirmed.
[
Footnote 1]
The word "located" appears in at least two other federal
statutes concerning national banks:
Title 28 U.S.C. § 1394 provides:
"Any civil action by a national banking association to enjoin
the Comptroller of the Currency, under the provisions of any Act of
Congress relating to such associations, may be prosecuted in the
judicial district where such association is located."
And 28 U.S. C. § 1348 reads:
"The district courts shall have original jurisdiction of any
civil action commenced by the United States, or by direction of any
officer thereof, against any national banking association, any
civil action to wind up the affairs of any such association, and
any action by a banking association established in the district for
which the court is held, under chapter 2 of Title 12, to enjoin the
Comptroller of the Currency, or any receiver acting under his
direction, as provided by such chapter."
"All national banking associations shall, for the purposes of
all other actions by or against them, be deemed citizens of the
States in which they are respectively located."
See First Nat. Bank v. Williams, 252 U.
S. 504 (1920), and
Herrmann v. Edwards,
238 U. S. 107
(1915), for comments upon the history of these respective
statutes.
[
Footnote 2]
Title 12 U.S.C. § 22 reads in part:
"The persons uniting to form such an association shall, under
their hands, make an organization certificate, which shall
specifically state:"
"
* * * *"
"Second. The place where its operations of discount and deposit
are to be carried on, designating the State, Territory, or
District, and the particular county and city, town, or
village."
[
Footnote 3]
The Supreme Court of Georgia, with one justice dissenting,
denied certiorari. App. to Pet. for Cert. A8. Petitioner's motion
for reconsideration was also denied, with two justices dissenting.
Id. at A9.
[
Footnote 4]
The Court long ago perceived a "local action exception" to this
rule.
Casey v. Adams, 102 U. S. 66,
102 U. S. 67-68
(1880).
See National Bank v. Associates of Obstetrics,
425 U. S. 460,
425 U. S.
461-462, n. (1976);
Michigan Nat. Bank v.
Robertson, 372 U. S. 591,
372 U. S. 593
(1963). The exception, however, as
Casey v. Adams itself
acknowledges, 102 U.S. at
102 U. S. 67,
does not apply to an ordinary transitory action.
See Mercantile
Nat. Bank v. Langdeau, 371 U. S. 555,
371 U. S. 561
n. 11 (1963).
[
Footnote 5]
At oral argument, petitioner acknowledged that
Langdeau
"is not determinative of the issue." Tr. of Oral Arg. 15.
[
Footnote 6]
In a number of federal cases, the words "established" and
"located" have been regarded as essentially the same.
E.g.,
Leonardi v. Chase Nat. Bank, 81 F.2d 19, 21-22 (CA2),
cert. denied, 298 U.S. 677 (1936);
Northside Iron
& Metal Co. v. Dobson & Johnson, Inc., 480 F.2d 798,
799 (CA5 1973);
Fisher v. First Nat. Bank, 538 F.2d 1284,
1286-1287 (CA7 1976),
cert. denied, 429 U.S. 1062 (1977);
United States Nat. Bank v. Hill, 434 F.2d 1019, 1020 (CA9
1970).
See 7A Michie, Banks and Banking, ch. 15, § 220a(4)
(1973 ed.). These cases, however, necessarily were concerned with
the word "established," and not with "located." None dealt with the
issue of venue of a state court suit against a national bank in a
county in which the bank was operating only a branch.
[
Footnote 7]
The addition was:
"That suits, actions, and proceedings against any association
under this title may be had in any circuit, district, or
territorial court of the United States held within the district in
which such association may be established, or in any State, county,
or municipal court in the county or city in which said association
is located having jurisdiction in similar cases."
See Third Nat. Bank v. Impac, Ltd., 432 U.
S. 312,
432 U. S.
316-318 (1977);
id. at
432 U. S.
325-327 (dissenting opinion).
[
Footnote 8]
Petitioner argues that the failure of Congress to change § 94
when it approved branch banking demonstrates a congressional intent
to restrict venue to the charter county. Brief for Petitioner
15-16, n. 28. We do not find this argument persuasive; petitioner
offers nothing to the effect that Congress even considered venue
when it authorized branch banking in 1927 and 1933.
[
Footnote 9]
One may argue, of course, that the concern also should evaporate
with respect to a federal suit at the place of the branch. That
issue is not before us. In any event, as has been stated above, we
have no occasion here to disturb the consistent authority relating
to federal venue.
[
Footnote 10]
This interpretation of § 94 will not inconvenience the bank or
unfairly burden it with distant litigation in violation of any
congressional policy. We recognize that Congress adopts venue
provisions in part for the convenience of the parties.
See
Olberding v. Illinois Central R. Co., 346 U.
S. 338,
346 U. S. 340
(1953) (interpreting 28 U.S.C. § 1391(a)). Litigation of this
dispute in De Kalb County inconveniences no one to any real degree.
Respondent chose to file his suit there. Petitioner has established
a permanent business there, taking advantage of the commerce of the
community. Its attorneys have their offices in adjoining Fulton
County, part of the Atlanta metropolitan area. Litigation in De
Kalb County cannot be more inconvenient than litigation in Chatham
County, the place of chartering, some 200 miles away.
MR. JUSTICE STEWART, concurring.
The Court's opinion, despite its disclaimer, may be read by some
to imply approval of the view that, for purposes of
Page 434 U. S. 46
federal court venue under 12 U.S.C. § 94, a national bank is
"established" only in the district that includes its charter
county.
See ante at
434 U. S. 39-41,
434 U. S. 44,
434 U. S. 45. I
have serious doubt that the cases so holding were correctly
decided,
* and, in any
event, this question remains an open one here.
Today we decide only that, for purposes of state court venue
under § 94, a national bank is "located" in any county in which it
has a branch bank. There is no need in this case to consider the
meaning of the word "established" in § 94, or to draw any contrast
between the words "established" and "located." It is upon this
understanding that I join the opinion of the Court.
* The first case to decide the question,
Leonardi v. Chase
Nat. Bank, 81 F.2d 19 (CA2), relied primarily on a First
Circuit decision holding that a national bank chartered in New York
was not "located" in Puerto Rico, where it operated a branch bank,
for purposes of taxation of the bank's shares,
National City
Bank v. Domenech, 71 F.2d 13, and on the general provision for
corporate venue which, at that time, limited venue to the district
of incorporation.
See 1 Moore's Federal Practice �
0.141[4], p. 1352 (2d ed.1977). Neither analogy compelled the
Second Circuit's conclusion. Subsequent cases have not amplified
Leonardi's reasoning.
See United States Nat. Bank v.
Hill, 434 F.2d 1019 (CA9), and cases cited therein.