ing associations are by virtue of the act of May 17, 1884 (23 Stat. 24), in force in the territory of Alaska, and such associations may be lawfully organized in that territory. (1890) 19 Op. Atty. Gen. 678. By virtue of section 14 of the act of April 12, 1900 (31 Stat. 77), the laws of the United States relative to the organization and powers of national banks were extended to Porto Rico. (1900) 23 Op. Atty. Gen. 169. The act of April 30, 1900 (31 Stat. 141), extended the national banking laws of the United States to the territory of Hawaii, and the Comptroller of the Currency is authorized to grant permission for the organization of national banks therein. Id. Cited without definite application, Talbott v. Board of Com'rs of Silver Bow County (1891) 11 Sup. Ct. 594, 595, 139 U. S. 438, 35 L. Ed. 210; Commercial National Bank v. Weinhard (1904) 24 Sup. Ct. 253, 256, 192 U. S. 243, 48 L. Ed. 425; Earling v. Emigh (1909) 30 Sup. Ct. 672, 674, 218 U. S. 27, 54 L. Ed. 915. The act of April 30, 1900 (31 Stat. 141), extended the national banking laws of the United States to the territory of Hawaii, and the Comptroller of the Currency is authorized to grant permission for the organization of national § 9660. (R. S. § 5135.) How certificate shall be acknowledged and filed. The organization certificate shall be acknowledged before a judge of some court of record, or notary public; and shall be, together with the acknowledgment thereof, authenticated by the seal of such court, or notary, transmitted to the Comptroller of the Currency, who shall record and carefully preserve the same in his office. Act June 3, 1864, c. 106, § 6, 13 Stat. 101. Copies of organization certificates certified and authenticated by the Comptroller of the Currency were made evidence in all courts and places within the United States of the existence of the association, and of all which could be proved by the originals, by R. S. § 885, ante, § 1497. § 9661. (R. S. § 5136.) Corporate powers of associations. matters Upon duly making and filing articles of association and an organization certificate, the association shall become, as from the date of the execution of its organization certificate, a body corporate, and as such, and in the name designated in the organization certificate, it shall have power— First. To adopt and use a corporate seal. Second. To have succession for the period of twenty years from its organization, unless it is sooner dissolved according to the provisions of its articles of association, or by the act of its shareholders owning two-thirds of its stock, or unless its franchise becomes forfeited by some violation of law. Third. To make contracts. Fourth. To sue and be sued, complain and defend, in any court of law and equity, as fully as natural persons. Fifth. To elect or appoint directors, and by its board of directors to appoint a president, vice-president, cashier, and other officers, define their duties, require bonds of them and fix the penalty thereof, dismiss such officers or any of them at pleasure, and appoint Others to fill their places. Sixth. To prescribe, by its board of directors, by-laws not inconsist ent with law, regulating the manner in which its stock shall be transferred, its directors elected or appointed, its officers appointed, its property transferred, its general business conducted, and the ileges granted to it by law exercised and enjoyed. priv shall Seventh. To exercise by its board of directors, or duly authorized officers or agents, subject to law, all such incidental powers as be necessary to carry on the business of banking; by discounting and negotiating promissory notes, drafts, bills of exchange, and other evidences of debt; by receiving deposits; by buying and selling change, coin, and bullion; by loaning money on personal security and by obtaining, issuing, and circulating notes according to provisions of this Title. the surrendered to be canceled, shall be burned to ashes in presence of four persons, one to be appointed by the Secretary of the Treasury, one by the Comptroller of the Currency, one by the Treasurer of the United States, and one by the association, under such regulations as the Secretary of the Treasury may prescribe. A certificate of such burning, signed by the parties so appointed, shall be made in the books of the Comptroller, and a duplicate thereof forwarded to the association whose notes are thus canceled. Act June 3, 1864, c. 106, § 24, 13 Stat. 106. Provisions relating to the destruction of national bank notes by maceration, and repealing so much of this section as required such notes to be burned, were made by Act June 23, 1874, c. 455, § 1, ante, § 6560. § 9724. (R. S. § 5185.) Organization of associations to issue gold notes authorized. Associations may be organized in the manner prescribed by this Title for the purpose of issuing notes payable in gold; and upon the deposit of any United States bonds bearing interest payable in gold with the Treasurer of the United States, in the manner prescribed for other associations, it shall be lawful for the Comptroller of the Currency to issue to the association making the deposit circulating notes of different denominations, but none of them of less than five dollars, and not exceeding in amount eighty per centum of the par value of the bonds deposited, which shall express the promise of the association to pay them, upon presentation at the office at which they are. issued, in gold coin of the United States, and shall be so redeemable. But no such association shall have a circulation of more than one million of dollars. Act July 12, 1870, c. 252, § 3, 16 Stat. 252. Provisions relating to the removal of the limitation restricting the circulation of banking associations issuing notes payable in gold were made by Act Jan. 19, 1875, c. 19, post, § 9725. Provisions authorizing the conversion of national gold banks into currency banks were made by Act Feb. 14, 1880, c. 25, post, § 9727. § 9725. (Act Jan. 19, 1875, c. 19.) Removal of limitation on circulation of gold banks. So much of section five thousand one hundred and eighty-five of the Revised Statutes of the United States as limits the circulation of banking-associations, organized for the purpose of issuing notes payable in gold, severally to one million dollars, be, and the same is hereby, repealed; and each of such existing banking-associations may increase its circulating-notes, and new banking-associations may be organized, in accordance with existing law, without respect to such limitation. (18 Stat. 302.) This was an act entitled "An act to remove the limitation restricting the circulation of banking-associations issuing notes payable in gold." R. S. § 5185, mentioned in this section, is set forth ante, § 9724. See notes to that section. § 9726. (R. S. § 5186.) Their lawful money reserve, and duty of receiving notes of other associations. Every association organized under the preceding section shall at all times keep on hand not less than twenty-five per centum of its outstanding circulation, in gold or silver coin of the United States; and shall receive at par in the payment of debts the gold-notes of every other such association which at the time of such payment is redeeming its circulating notes in gold coin of the United States, and shall be subject to all the provisions of this Title: Provided, That, in applying the same to associations organized for issuing gold-notes, the terms "lawful money" and "lawful money of the United States" shall be construed to mean gold or silver coin of the United States; and the circulation of such associations shall not be within the limitation of circulation mentioned in this Title. Act July 12, 1870, c. 252, §§ 3–5, 16 Stat. 252, 253. § 9727. (Act Feb. 14, 1880, c. 25.) Conversion of national gold banks into currency banks. Any national gold bank organized under the provisions of the laws of the United States, may, in the manner and subject to the provisions prescribed by section fifty-one hundred and fifty-four of the Revised Statutes of the United States, for the conversion of banks incorporated under the laws of any State, cease to be a gold bank, and become such an association as is authorized by section fifty-one hundred and thirty-three, for carrying on the business of banking, and shall have the same powers and privileges, and shall be subject to the same duties, responsibilities, and rules, in all respects, as are by law prescribed for such associations: Provided, That all certificates of organization which shall be issued under this act shall bear the date of the original organization of each bank respectively as a gold bank. (21 Stat. 66.) This was an act entitled "An act authorizing the conversion of national gold banks." R. S. §§ 5133, 5154, mentioned in this section, are set forth ante, §§ 9658, 9694. § 9728: (R. S. § 5187.) Penalty for issuing circulating notes to unauthorized associations. No officer acting under the provisions of this Title shall countersign or deliver to any association, or to any other company or person, any circulating notes contemplated by this Title, except in accordance with the true intent and meaning of its provisions. Every officer who violates this section shall be deemed guilty of a high misdemeanor, and shall be fined not more than double the amount so countersigned and delivered, and imprisoned not less than one year and not more than fifteen years. Act June 3, 1864, c. 106, § 27, 13 Stat. 107. (R. S. §§ 5188, 5189. Repealed.) R. S. § 5188, made punishable the imitating of national bank notes by business, etc., cards, etc., or advertisements, or writing, printing, etc., on such notes, any business, etc., card, or notice or advertisement. R. S. § 5189, made punishable the mutilating, etc., national bank notes, etc., with intent to render the same unfit to be reissued. These two sections were incorporated into the Criminal Code, in sections 175, 176, thereof, respectively, post, §§ 10345, 10346, and were repealed by section 341 thereof, post, § 10515. CHAPTER TWO A National Currency Associations This chapter, inserted here as additional to the original chapters of this Ti tle of the Revised Statutes, included the provisions for the issue by national currency associations of additional circulating notes, in emergencies; being parts of the Aldrich-Vreeland (National Currency Associations) Act of May 30, 1908, c. 229, 35 Stat. 546, Act Aug. 22, 1911, c. 36, § 4, 35 Stat. 553, and Act Dec. 23, 1913, c. 6, § 27, 38 Stat. 274. Section 1 of said Act May 30, 1908, c. 229, authorized national banking associations having a certain amount of capital and surplus to form voluntary associations, to be designated as national currency associations, prescribed the method of organizing such associations, limited the number of such associa tions in any one city, designated the geographical locations of such associations, provided for the admission to such associations of national banks having the necessary qualifications, provided that each association should be composed exclusively of banks not members of any other association, provided for the effect of the dissolution of a member of such association and the effect of the reduction in number of members of such associations, provided for the management of the affairs of such associations, provided for the making of by-laws by such associations, prescribed the officers of such associations, prescribed the powers of the executive committees of such associations, provided for the issue madge v. Third Nat. Bank of New York (N. Y. 1882) 27 Hun, 61. Banks have power to employ attorneys to prosecute or defend suits, and the president may agree as to their compensation. Guthrie Nat. Bank v. Earl (1895) 2 Okl. 617, 39 Pac. 391. 6. Jurisdiction.-See note under § 9668, post. This section and R. S. § 5198 (see section 9759, post), modified Judiciary Act 1789, § 9 (R. S. §§ 563, 711, ante, §§ 991, 1233), as to jurisdiction of actions against national banks for penalties, and give concurrent jurisdiction to the state courts. First Nat. Bank v. Morgan (1889) 10 Sup. Ct. 37, 38, 132 U. S. 141, 33 L. Ed. 282. IV. BY-LAWS 7. In general.-A repealed statute cannot be retained by a by-law. First Nat. Bank v. Lanier (1870) 11 Wall. 369, 374, 20 L. Ed. 172. A by-law of a national bank, though indorsed on a stock certificate, prohibiting a stockholder who is indebted to the bank from transferring his certificate, is void, as in contravention of g 9762. Feckheimer v. National Exch. Bank (1884) 79 Va. 80. 8. Transfer of stock. The directors of a national bank have authority to forbid any stockholder indebted to the bank, whether as principal or surety, to transfer his stock without the consent of a majority of the directors. Knight v. Old Nat. Bank (C. C. 1871) Fed. Cas. No. 7,885. The power conferred upon national banks by the national banking act of congress, to enact by-laws, is broad enough to authorize a by-law declaring that no shares shall be transferred while the holder is indebted to the bank; and such a by-law is reasonable and valid, and any attempted transfer by the shareholder while indebted to the bank is void. Young v. Vough (1873) 23 N. J. Eq. (8 C. E. Green) 325. The articles of association of a national bank provided that the bank might make by-laws to prohibit the transfer of stock owned by a stockholder liable to it either as principal debtor or otherwise. Certificates of stock were issued, which did not state that they were not transferable by the holder while liable to the bank, but which stated that they were transferable only on the books of the bank on surrender of the certificates. Held that, though the stock was not negotiable paper in the legal sense of the term, the fact that the bank had put it in the power of the stockholder to transfer the stock estopped it from objecting to a bona fide transfer on the ground that the original holder was indebted to the bank. Lee v. Citizens' Nat. Bank (Ohio, 1872) 2 Cin. R. 298. A national bank made a by-law permitting a transfer of stock by signing a blank form of indorsement on a stock certificate, which provided that the shares were transferable only on the books of the bank on surrender of the certificate, but contained no notice of another by-law prohibiting a stockholder indebted to the bank from transferring his stock. Held, that a bona fide transferee of such a certificate from a stockholder indebted to the bank had an equity in the shares of the stock superior to the bank. Lee v. Citizens' Bank (1872) 5 Ohio Dec. 21. A national bank has the power to make by-laws providing that the shares of its capital stock shall be transferable only on its books; that no stockholder shall be allowed to sell or transfer his stock while indebted to the bank, without the assent of its directors; and that the stock of any stockholder shall be held pledged and liable for the payment of any debt due from such stockholder, and may be sold at public auction for the satisfaction of such debt, on default of payment thereof. Lockwood v. Mechanics' Nat. Bank (1869) 9 R. I. 308, 11 Am. Rep. 253. 9. Lien on stock.-A national bank has no lien, through its by-laws, on its own stock for a debt due from a stockholder to the bank. Second Nat. Bank v. National State Bank (1874) 73 Ky. (10 Bush) 367; Delaware, L. & W. R. Co. v. Oxford Iron Co. (1884) 38 N. J. Eq. 340; Goodbar v. City Nat. Bank (1890) 78 Tex. 461, 14 S. W. 851. A national bank cannot, even by provisions framed with a direct view to that effect in its articles of association, and by direct by-laws, acquire a lien on its own stock held by persons who are its debtors. A by-law giving to a bank a lien on stock of its debtors is not "a regulation of the business of the bank, or a regulation for the conduct of its affairs," within the meaning of the national banking act of 1864, and therefore not such a regulation as, under the act, national banks have a right to make. Bullard v. National Eagle Bank (1873) 85 U. S. (10 Wall.) 589, 21 L. Ed. 923. A national bank may, by a by-law, subject the shares of a stockholder to a lien for his debt to the bank, so as to prevent a transfer on the books until such debt is paid. Bath Sav. Inst. v. Sagadahoc Nat. Bank (1897) 36 A. 996, 89 Me. 500. Unless the articles of association of a banking corporation expressly authorize the directors by a by-law to make the stock of any of its stockholders subject to a lien in favor of the bank, as security for a debt due by him to the bank, no such lien can be thus created. Rosenback v. Salt Springs Nat. Bank (N. Y. 1868) 53 Barb. 495. A provision in the by-laws and stock certificates of a national bank that the stock was not transferable until all the former stockholder's liabilities to the bank were paid is void, and will not National banking associations having circulating notes secured otherwise than by bonds of the United States, shall pay for the first three months a tax at the rate of three per centum per annum upon the average amount of such of their notes in circulation as are based upon the deposit of such securities, and afterwards an additional tax rate of one-half of one per centum per annum for each month until a tax of six per centum per annum is reached, and thereafter such tax of six per centum per annum upon the average amount of such notes." portion applicable thereto read as follows: Said Act Dec. 23, 1913, c. 6, § 27, was amended by Act Aug. 4, 1914, c. 225, 88 Stat. 682, to read as follows: "The provisions of the Act of May thirtieth, nineteen hundred and eight, authorizing national currency associations, the issue of additional national-bank circulation, and creating a National Monetary Commission, which expires by limitation under the terms of such Act on the thirtieth day of June, nineteen hundred and fourteen, are hereby extended to June thirtieth, nineteen hundred and fifteen, and sections fifty-one hundred and fifty-three, fifty-one hundred and seventy-two, fifty-one hundred and ninety-one, and fifty-two hundred and fourteen of the Revised Statutes of the United States, which were amended by the Act of May thirtieth, nineteen hundred and eight, are hereby reenacted to read as such sections read prior to May thirtieth, nineteen hundred and eight, subject to such amendments or modifications as are prescribed in this Act: Provided, however, That section nine of the Act first referred to in this section is hereby amended so as to change the tax rates fixed in said Act by making the portion applicable thereto read as follows: "National banking associations having circulating notes secured otherwise than by bonds of the United States, shall pay for the first three months a tax at the rate of three per centum per annum upon the average amount of such of their notes in circulation as are based upon the deposit of such securities, and afterwards an additional tax rate of one-half of one per centum per annum for each month until a tax of six per centum per annum is reached, and thereafter such tax of six per centum per annum upon the average amount of such notes: Provided further, That whenever in his judgment he may deem it desirable, the Secretary of the Treasury shall have power to suspend the limitations imposed by section one and section three of the Act referred to in this section, which prescribe that such additional circulation secured otherwise than by bonds of the United States shall be issued only to National banks having circulating notes outstanding secured by the deposit of bonds of the United States to an amount not less than forty per centum of the capital stock of such banks, and to suspend also the conditions and limitations of section five of said Act except that no bank shall be permitted to issue circulating notes in excess of one hundred and twenty-five per centum of its unimpaired capital and surplus. He shall require each bank and currency association to maintain on deposit in the Treasury of the United States a sum in gold sufficient in his judgment for the redemption of such notes, but in no event less than five per centum. He may permit National banks, during the period for which such provisions are suspended, to issue additional circulation under the terms and conditions of the Act referred to as herein amended: Provided further, That the Secretary of the Treasury, in his discretion, is further authorized to extend the benefits of this Act to all qualified State banks and trust companies, which have joined the Federal reserve system, or which may contract to join within fifteen days after the passage of this Act." The date last mentioned having passed without any further extension having been made, said Act May 30, 1908, c. 229, became inoperative, and is therefore omitted from this compilation, except sections 12, 14, and 15, which are set forth post, § 9752, and ante, §§ 9692, 9693, respectively. Act Aug. 22, 1911, c. 36, § 4, 37 Stat. 30, provided that: Pro "No one receiving a salary or emoluments from the Government of the Unit ed States, in any capacity, shall receive any salary or emolument as a member or employé of said commission from the date of the passage of this Act: vided, That voluntary assistance, without compensation, may be accepted by the commission from present employés or from others whose assistance may be desired by the commission." Said section is also omitted from this compilation for the reasons above. stated Said Act Dec. 23, 1913, c. 6, § 27, 38 Stat. 274, as amended by said Act Aug. 4, 1914, c. 225, 38 Stat. 682, is also omitted from this compilation for the rea sons stated above. The Federal Reserve Act of Dec. 23, 1913, c. 6, post, §§ 9785-9805, created a new system for the government and regulation of all national banks, and such of the state banks and trust companies as, possessing the necessary qual ifications, should signify their acceptance of the act. |