Графични страници
PDF файл
ePub

Bushnell v. The Chautauqua County National Bank.

son to the use or credit of another. It is argued by the respondent's counsel that the bank became a surety for Shaw. Not at all. Its obligation was that of a principal debtor. It was indebted to Shaw for the money deposited, and it agreed to discharge its indebtedness by paying to the plaintiff. We are not aware of any provision of law which incapacitates a National bank from receiving a deposit of money on the terms above stated.

But assuming that the undertaking of the bank was ultra vires, yet, as it was not illegal, we think the defendant is estopped from setting up that defense. As has been said, the legal effect of the transaction between the bank and the plaintiff was that the bank agreed, if he would enter into the contract with Shaw, that he should be compensated out of the money deposited from any damage he might sustain from Shaw's failure to perform. The condition on which Shaw made the deposit was that the bank should undertake to that effect. The agreement of the bank was an appropriation by it of the deposit to the plaintiff's use, by the direction of the depositor. The agreement has been fully executed on the part of the plaintiff by his entering into the proposed obligation to Shaw. It would be a fraud upon him to release the defendant from its part of the agreement, and the bank is therefore estopped from setting up a mere want of power. Whitney Arms Co. v. Barlow, 63 N. Y. 62.

It was not necessary or proper for the plaintiff to set out the implied promise of the defendant in the complaint. It was enough to allege the facts out of which the implication arises. Eno v. Woodworth, 4 Comst. 249; Glenny v. Hitchins, 4 How. Pr. 98; Crapsey v. Sweeny, 27 Barb. 310; Moak's Van Santvoord's Pl. (3d ed.) 186, and cases there cited.

These views, if correct, dispose of the several positions taken by the learned counsel for the respondent.

The judgment appealed from should be reversed, and judgment ordered for the plaintiff on the demurrer, with leave to the defendant to answer in twenty days, on payment of the costs of the demurrer and of this appeal.

MULLIN, P. J., and TALCOTT, J., concurred.

Ordered accordingly.

National Park Bank v. Gunst.

NATIONAL PARK BANK V. GUNST.

(1 Abbott's New Cases, 292.)

National bank - Citizenship of

A National bank is a foreign corporation under a statute requiring corporations created by "the laws of any other State or country," to give security for costs.

[ocr errors]

OTION to compel the plaintiff, a National bank, to give security for costs on the ground that it was a corporation organized under the laws of another State or country within the statute which provides that" a foreign corporation created by the laws of any other State or country may, upon giving security for the payment of the costs of suit, prosecute, in the courts of this State, in the same manner as corporations created under the laws of this State." 2 Rev. Stat. 457.

C. E. Souther, for the motion.

Peter B. Olney, contra.

MONELL, Ch. J., decided in favor of the defendant, and an order was entered requiring the bank to file the requisite bond as security.

NOTE. No opinion is reported in the foregoing case. The counsel cited the case of Merchants' National Bank v. MacNaughton (not reported), decided at Chambers Supreme Court by LEONARD, J., who held, on a question regarding pleadings and proof of incorporation, that "the plaintiff must be held to be a foreign corporation," citing Bowen v. First National Bank of Medina, 34 How. 409. No opinion was reported.

In Bowen v. First Nat. Bank, supra, the General Term of the Supreme Court, First District, held, that National banks were foreign corporations under a statute authorizing attachments against "corporations created by or under the laws of any other State, government or country." The Bank

ing Act was afterward amended so as to prohibit attachments of National banks before judgment and the case is therefore no longer authority and is not included in this volume. That case is not only not an authority for the above case of National Park Bank v. Gunst, but the reasoning of the court is against it. In Gunst's case the statute related to corporations created by the laws of "any other State or country" while in Bowen's case the statute related to corporations created by or under the laws of "any other State, government, or country," and it was on the word "government" that the court based its opinion that National banks were within the act.-REP.

National State Bank of Newark v. Boylan.

NATIONAL STATE BANK OF NEWARK V. BOYLAN.

(2 Abbott's New Cases, 216.)

Usury-Counter-claim for interest in action by National bank — Limitation of.

In an action by a National bank the defendant cannot be allowed a counterclaim for unlawful interest paid by him more than two years prior thereto.* One of two or more defendants cannot set up an individual counter-claim' unless, under the pleadings, there can be a several judgment against him.

A

CTION by the National State Bank of Newark against James B. Boylan and John Boylan on judgments against them obtained in the Supreme Court of New Jersey.

The defendant, John Boylan, answering separately, alleged, among other things, that he was liable, if at all, only as surety and conditionally, and that between February, 1871, and June, 1875, the plaintiff had exacted from him usurious and unlawful interest for loans and discounts made to and for him, and that the plaintiffs had so received from him $7,000 in excess of the lawful interest allowed by the laws of the State and the act of Congress under which plaintiff was incorporated. For which sum defendant asked a judgment in his favor. The plaintiff demurred.

Martin & Smith, for plaintiff.

Oliver J. Wells, for defendant.

SEDGWICK, J. The decision of this demurrer involves a construction of section 30 of 13 U. S. Statutes at Large, June 3, 1864, as to the time within which an action for an excess of interest received by the plaintiff on a usurious loan by it to the defendant may be brought.

The act declares that every association may receive on a loan or discount "interest at the rate allowed by the laws of the State or territory where the bank is located, and no more."

"And the knowingly taking." etc., "a rate of interest greater than

*See Shingle v. First National Bank, post.

National State Bank of Newark v. Boylan

the aforesaid shall be held and adjudged a forfeiture of the entire interest, which the * * evidence of debt carries with it, or which has been agreed to be paid thereon. And in case a greater rate of interest has been paid, the person or persons paying the same may recover back, in an action of debt, twice the amount of interest thus paid, from the association taking the same; provided that such action is commenced within two years from the time the usurious transaction occurred."

*

*

Whether or not the statute gives a general cause of action, based upon the illegality of a National bank taking more interest than is allowed by the law of the State where the bank is situated, as declared by the first part of the section, in addition to the particular causes of the action given thereafter, such general cause of action to be governed by the statute of limitations of the State or of the United States, in case there should be one, is to be determined solely by the intent of the section. It was competent, of course, for Congress to declare that a borrower should have no such general cause of action.

I am of opinion that the section provides in its special clauses, for all the causes of action that result from an infraction of the section. The special clauses are so framed and attached to the rest of the section, that thereby is implied the negative of there being a general cause of action so to call it.

The statute did not take away the right to recover the principal of a loan on which usurious interest has been taken or agreed for. It proceeds to say, that the taking or charging a usurious rate is to be held a forfeiture of the entire interest, and if a usurious rate has been paid, twice its amount may be recovered back, provided the action has been begun within two years. An entire scheme of protection, involving a policy peculiar to it, is thus given to a borrower. In case the interest has been paid, twice the amount of the usurious rate may be recovered, and in all other cases, the bank forfeits all right to the interest

At common law, if the borrower were oppressed, as he was supposed to be, by the usurer, and paid the usurious rate, he could recover it, because, although, in pari delicto, he was a victim. The United States statute gives an action in such a case of a peculiar kind, which makes the borrower whole and enforces the policy of the statute.

National State Bank of Newark v. Boylan.

At common law, if he had not paid the usurious interest, and then, on demand, voluntarily paid it with the principal due, in the absence of some statutory action he could not recover the excess of interest back. Under the United States statute the interest being forfeited, if the borrower voluntarily pays it, without something more, but for the action to be brought within two years, the borrower cannot recover it back.

So that we see the statute by a way of its own provides for all the cases in which a borrower may be protected, just as did the common law, and in such a form, that to me it seems clear that the particular provisions are meant to include all the consequences to be attached to a violation of the provision that says a bank shall take the interest of the particular State and no more. Farmers', etc., Nat. Bank v. Dearing, 1 Otto, 29; Palen v. Johnson, 50 N. Y. 49; Smith v. Marvin, 27 id. 137; Wheaton v. Hibbard, 20 Johns. 290. The reasoning of Palen v. Johnson is to be applied in this case, and the United States statute takes hold of the right of action, under the general prohibition, and regulates its exercise, just as in that case the statute took hold of the right under the section declaratory of the common law and regulated its exercise.

Palen v. Johnson is a precedent to allow advantage being taken by demurrer of a limitation of this kind, instead of by pleading the statute of limitation.

On general principles it seems to me clear, that, if, especially when all circumstances of oppression are wanting, the borrower chooses to pay voluntarily, his action is confined to the statute.

There are some parts of the counter-claim which refer to interest received within two years. There is a doubt raised, whether part of the counter-claim, being on this point good, a demurrer will lie to the whole counter-claim. It is unnecessary to decide this at this time, because I find a fatal objection to the whole counterclaim.

It is based upon an objection peculiar to the defendant John Boylan, individually. This is not proper matter for a counterclaim, unless there could be, under the pleadings, a several judgment against him. There could not be, because the complaint is upon a judgment against him and another jointly.

Without at all deciding that if this judgment were against an indorser and a maker of a note, it is joint, there is no allegation of the answer that such is the character of the judgment, or that the defend

« ПредишнаНапред »