Cadle v. Baker

ERROR to the District Court for the Middle District of Alabama; the case being thus:

The forty-sixth and forty-seventh sections of the National Currency Act provide that if any of the banks which it authorizes fail to redeem their notes, the holder may have the notes protested; and that notice of the protest shall be forwarded to the Comptroller of the Currency; that upon receiving notice of such failure to redeem, the comptroller shall send a special agent to ascertain the facts; and if, on the report of such agent, he shall be satisfied of the failure, he shall declare the securities of the bank pledged for redemption of the notes forfeited, and give notice to the noteholders to present them to him for payment.

The fiftieth section enacts that on becoming satisfied of the failure 'as specified in this act,' he may also appoint a receiver, who, under his direction, shall take possession of the assets of the bank and collect all debts due to it, &c.

The same section provides, however, that if the bank denies that it has failed to redeem its notes, it may apply to the nearest District Court or Territorial court to enjoin further proceedings in the premises, when, if such court, on hearing the case, shall be satisfied that there has been no failure, it may enjoin both comptroller and receiver from all further proceedings on account of such alleged refusal.

This statute being in force, the Comptroller of the Currency appointed one Cadle receiver of the First National Bank of Selma, and the said Cadle, as such receiver, brought suit in the court below against a certain Baker, to recover the amount due upon a bill of exchange, drawn by Cadle and indorsed to the bank, and held as part of its assets at the time when Cadle was appointed receiver. The declaration contained an averment in substance that the Comptroller of the Currency having become satisfied, 'as specified in the Banking Act,' that the bank had refused to pay its notes, did appoint the plaintiff 'a receiver as provided by the fiftieth section of the act,' and that he had qualified under his appointment and entered upon the performance of his duties. The defendants demurred to the declaration, and, in effect, assigned for cause that it was not specifically averred that each and all of the several things had been done which were provided for in sections forty-six and forty-seven, in order to furnish the evidence to satisfy the comptroller that the bank had refused to pay its notes and was in default. The court below sustained the demurrer and gave judgment for the defendant. The receiver now brought the case here.

Mr. P. Phillips, for the plaintiff in error; no opposing counsel.

The CHIEF JUSTICE delivered the opinion of the court.