a right is property. And where a foreign | a general rule,— -see Thames Haven Dock & corporation had bought land on execution, Railway Co. v. Hall, 5 Mann. & G. 274; and was entitled to a deed, and its interest in Regina v. Justices of Cumberland, 17 Law the land had been attached,-Held, that it J. N. S. Q. B. 102. could not relinquish its rights so as to defeat the lien of the attachment. N. Y. Ct. of Appeals, 1849, Wright v. Douglass, 2 N. Y. (2 Comst.) 373. 5. That property of a corporation which is not liable to be applied to the claims of an individual creditor, cannot be attached at his suit,- -see Ridge Turnpike Co. v. Peddle, 4 Pa. St. 490. 6. When a statute provided that the State should subscribe for half the stock in all incorporated railroad and turnpike companies, and should have a lien on the property of the corporation to secure the payment of the other half of the stock by individual subscribers: Held, that the property of such a corporation was not attachable for its debts until the lien of the State was extinguished by payment for the stock. Tenn. Supreme Ct. 1844, State v. Lagrange & Memphis Railroad, 4 Humph. 488. 7. Effect of dissolution. Wherever a foreign attachment will lie against a corporation as defendant, civil death before judgment against it, produced by a decree of forfeiture of its charter by a judicial tribunal, dissolves the attachment. The primary intent being to procure an appearance, a foreign attachment is dissolved the instant the defendant has appeared, or lost his capacity to appear. Pa. Supreme Ct. 1844, Farmers' & Mechanics' Bank v. Little, 8 Watts & S. 207. 8. or of transfer of assets to receiver. After the property of a foreign corporation has been transferred to a receiver, for the benefit of the creditors of the corporation, and the title thereto has become vested in the receiver, under an order of a court of the State where the corporation is situated, such property cannot be reached by an attachment in another State, as the property of the corporation. N. Y. Chancery, 1841, Thomas v. Merchants' Bank, 9 Paige, 215. ATTORNEYS. 1. Seal when necessary to appointment, in England. That attorney to sue or defend for a corporation, should, in England, be constituted by an appointment under seal, as 2. Attorney to sue or defend for an English municipal corporation not entitled to recover compensation for services under appointment, unless under corporate seal. See Arnold v. Mayor &c. of Poole, 2 Dowl. N. S. 574; 7 Jur. 653; 12 Law J. N. S. 97; 4 Mann. & G. 860; 5 Scott N. R. 741. 3. Statute salary. A statute prescribing the salary of "the attorney" of a State bank, will be construed only as fixing the compensation of the regular attorney elected as an officer of the bank; and not as restraining the directors, by implication, from employing additional attorneys in special cases. Ala. Supreme Ct. 1843, State Bank v. Martin, 4 Ala. N. S. 615. See also Regina v. Prest, 1 Eng. L. & Eq. 250; 15 Jur. 554; 20 Law J. Q. B. 17. 4. But a voluntary payment, by the corporate authorities, for such services, is not a misapplication of corporate funds. See Regina v. Prest, 1 Eng. L. & Eq. 250; 15 Jur. 554; 20 Law J. Q. B. 17. 5. A general retainer by resolution of a town council, Held sufficient retainer to warrant the payment to the attorney of the costs of a successful defence of proceedings against the town. Regina v. Lichfield, 10 Q. B. 534. 6. Attorney for corporation, though not retained under seal, may nevertheless give a binding consent to a judge's order referring cause to arbitration. See Faviell v. Eastern Counties Railway Co. 2 Exch. 344, 17 Law J. N. S. Exch. 297. 7. Seal not necessary in the United States. A corporation can do an act in pais by means of an attorney in fact. Thus an attorney on behalf of a bank is competent to give the notice required by the statute of Alabama, providing for summary proceedings against debtors to banks. And such notice need not be under the seal of the bank. Ala. Supreme Ct. 1839, Curry v. Bank of Mobile, 8 Port. 360. 8. Authority from the president of a corporation to an attorney or solicitor to appear for the corporation, is sufficient to bind the corporation by the proceedings had by the attorney. The acts and assents of corporations, like those of individuals, when not reduced to writing, may be inferred from town. And if a town agent, being also an atother facts and circumstances without a vio-torney at law, after his term as agent has exlation of any known rule of evidence. And if the president exceeded his authority, in giving such power, the corporation should look to him for any damage it may have sustained by this act of his. N. Y. Chancery, 1842, American Ins. Co. v. Oakley, 9 Paige, 496; S. P. Me. Supreme Ct. 1849, Lime Rock Bank v. Macomber, 29 Me. 564; N. H. Superior Ct. 1817, Eastman v. Coos Bank, 1 N. H. 23. 9. To prove the withdrawal of a suit brought by a corporation, a vote of that corporation authorizing the withdrawal is not necessary; if the act be done by its agent or attorney, no other proof of authority will be required. Conn. Supreme Ct. 1841, Union Manuf. Co. v. Pitkin, 14 Conn. 174. 10. That the fact that the declaration, in a suit by a corporation, was signed and filed by an attorney at law for the plaintiff, is sufficient evidence that the plaintiff appeared, as a corporation must appear, by attorney,‚—see State Bank v. Bell, 5 Blackf. 127. See also Brookville Ins. Co. v. Records, 5 Blackf. 170; Bridgton . Bennett, 23 Me. 422. 11. Authority of city attorney or counsel. Whether, in proceedings by or against a municipal corporation whose charter creates a law department as one branch of the municipal government, and provides for the designation of an official attorney or counsel for the city, the courts of New York will recognize any other person than such official attorney, who may claim to represent the city in a particular suit, see Mayor &c. of New York . Exchange Fire Ins. Co. 17 How. Pr. 380; Parker v. City of Williamsburgh, 13 How. Pr. 250; Brady v. Mayor &c. of New York, 1 Sandf. 562. 12. His right in the office. That a counsel to a municipal corporation has no such vested right in his office, during the term for which he is elected, as to render an ordinance abolishing the office void, for interfering with the obligation of a contract,-see Primm v. City of Carondelet, 23 Mo. 22. 13. Town attorney. When a town agent employs an attorney in a suit in favor of or against the town, the town is legally holden to pay the attorney's services, without an express vote to that effect; and the rule is the same, if the town agent, being himself an attorney, renders professional services for the pired, continues in the management of the suits in which the town are interested, without any objection from, or any express employment by the town or his successor, he is entitled to recover of the town for the professional services rendered after his term of office as town agent has expired. Vt. Supreme Ct. 1858, Langdon v. Castleton, 30 Vt. 285. 14. The town of C. held a public meeting in regard to the proposed alteration, by a railroad company, of the channel of a stream, and passed resolutions directing legal proceedings to be commenced against the company, to prevent such alteration. The plaintiff spoke at the meeting in favor of the resolutions, and said he would indemnify the town against all expenses arising from such legal proceedings, for six cents. It was the general expectation among the inhabitants of the town that the expenses of such legal proceedings would be borne by another railroad company, of which the plaintiff was a director, but there was no evidence that this expectation was based on anything said or done by the plaintiff or any one in behalf of that company. The officers of the town, in consequence of these resolutions, caused a bill for an injunction against the proposed alteration of the stream to be brought in the name of the town, in which the plaintiff, having subsequently been appointed town agent, rendered professional services for the town as a solicitor. Held, that the plaintiff was entitled to recover of the town for such services. Ib. 15. An offer by an agent, appointed by a town to prosecute and defend suits in which the town should be a party, of a certain sum in compromise of a suit against the town,— Held, not competent evidence against the town. See Rollins v. Town of Chester, 46 N. H. 411. As to the rules governing appointment, powers, duties, and compensation of Attorneys of corporations, in common with other agents, see AGENTS. How attorneys are to conduct Judicial proceedings, in which corporations, their clients, are parties, see SUITS, and the titles of various special proceedings: e. g. MANDAMUS; QUO WARRANTO. BANKS. [Throughout this work titles of particular kinds or classes of corporations, present, as a general rule, only matters presumed to be peculiar to the particular class mentioned. Rules which the reader would desire to consult with reference to corporations of more than a single class, are placed as far as possible under the appropriate general heads. Thus the decisions on bank charters which may be ap plicable to other corporations, are not under BANKS, but under CHARTERS; decisions on the execution, validity. interpretation &c. of contracts with banks, resting upon principles applicable to other corporate contracts, are un der CONTRACTS and its co-related titles, such as ASSIGNMENTS; DEEDS; MORTGAGES; &c.; the general rights of banks in respect to PROPERTY, are treated under PROPERTY and titles there referred to; and the powers and duties of bank officers, except so far as they are peculiar to banks, are presented under the general head, OFFICERS, and the titles of the particular offices known in corporate organizations. As this work is confined to the law of Corporations, much of the law of banking, considered as a vocation which might be carried on by a private individual or firm, equally as by a corporation, is excluded, or only very briefly in dicated. Such matters should be sought for in works on Contracts. Our purpose is confined to a discussion of Banks considered as one species of corporations.] I. THE FRANCHISE. II. THE NATIONAL BANKING SYSTEM. III. UNDER STATE BANKING SYSTEMS. 1. Safety-fund acts. 2. Under free banking laws. IV. OFFICERS. 1. Generally. 2. Directors. 3. The president. 4. The cashier. 5. Tellers. V. BUSINESS AND DEALINGS. 1. Generally. 2. Circulation. 3. Deposits. 4. Loans and discounts. 5. Collections. 6. Lien. VI. USAGES. I. THE FRANCHISE. 1. What is "banking." Banking powers consist in the right of issuing notes,* making discounts, and receiving deposits. N. Y. Supreme Ct. 1824, N. Y. Firemen Ins. Co. v. Ely, Cor. 678. 2 * As to what is meant by "banking,"-see also United States Trust Co. v. Brady, 20 Barb. 119; Scott v. Depeyster, 1 Edw. 513; People v. Utica Ins. Co. 15 Johns. 358; Fire men Ins. Co. v. Sturges, 2 Cow. 664; Curtis v. Leavitt, 15 N. Y. 9, 167; Ohio Life Ins. & Trust Co, v. Debott, 16 How. 416, 438; People v. River Raisin &c. R. R. Co. 12 Mich. 2. The receiving of deposits by a chartered company, and loaning or investing the same for the benefit of depositors, is a business of banking. Banks, in the commercial sense, are of three kinds: 1. Of deposit; 2. Of disCount; 3. Of circulation. It may be that all, or any two, of these functions, are exercised by the same association; but there are banks of deposit, without authority to make disCounts, or issue a circulating medium. [Ang. & A. on Corp. § 55; McCull. Com. Dic. 73.] U. S. Supreme Ct. 1865, Bank for Savings v. The Collector, 3 Wall. 495. 3. Banking a common law right. When the constitution of a State does not restrict private banking, it may be carried on, as of right at common law, until forbidden by act of the legislature. Ala. Supreme Ct. 1840, Nance v. Hemphill, 1 Ala. N. S. 551. 4. Under the constitution of Indiana, no bank of issue can be established, except a State bank, and free or private banking institutions, pursuant to the general banking law of the State; and therefore an association of individuals for the purpose of banking, not in pursuance of any statute law, is illegal. The right to issue bills to circulate as money, is not a common law right. Ind. Circuit Ct. 1859, Anderson v. Alexander, 7 Am. Law Reg. 173. 5. At Common law, the right of banking in all its ramifications, belonged to individual citizens, and might be exercised by them at their pleasure. Undoubtedly, the sovereign authority may regulate and restrain this right. But a provision in the constitution of a State, which purports to be nothing more than a restriction on the power of the legislature in reference to banking, will not be construed, by the courts of the United States, in the absence of any declared policy of legislation or judicial decision in such State, to be intended as a restriction on the right of individuals or foreign corporations to deal in exchange. The effect of giving a restriction of this kind such a construction, would be that no individual citizen of the State could purchase a bill. And it will not be presumed that a State has intended, by its constitution, to prohibit its merchants and traders from purchasing or selling bills of exchange, and to make that business a monopoly in the hands of banks. U. S. Supreme Ct. 1839, Bank of 359; Act of Congress of July 13, 1869, § 9, 14 U. S. Stat. Augusta v. Earle, 13 Pet. 516, 596. at L. 115. For some account of the restrictions im posed by various State constitutions upon the powers of the legislatures in respect to banks in common with other corporations, see CON STITUTIONS. 6. In New York, the common law right of banking has been, by statute, taken from individuals, and banking has been made a franchise derived from the grant of the Legislature.* N. Y. Chancery, 1817, Attorney General 7. Utica Ins. Co. 2 Johns. Ch. 371; N. Y. Supreme Ct. 1818, People v. Utica Ins. Co. 15 Johns. 358. See infra, 64–69. 7. That the name "Bank" imports a corporation, and a statute referring to a bank by name, may be deemed a legislative recognition of its corporate existence-see State v. Helmes, 2 Pennington, 764. As to what banking houses are deemed Corporations, and how banking corporations in common with other kinds should be Organized, see INCORPORATION; ORGANIZATION. 8. Power of Congress to create a bank. Congress has power to incorporate a bank, whenever such an institution is deemed the most appropriate means of carrying into effect any of the enumerated powers granted by the Constitution to the general government; and the degree of necessity for such a measure is a question of legislative discretion, not of judicial cognizance. U. S. Supreme Ct. 1810, McCulloch v. State of Maryland, 4 Wheat. 316; 1824, Osborn v. Bank of the United States, 9 Wheat. 738. 9. What enactments will confer "banking powers." A corporation whose charter, passed before the existence of any restraining acts, provides that "it shall be lawful for them to employ all such surplus capital as may belong or accrue to said company in the purchase of public or other stock, or in any other moneyed transaction or operation not inconsistent with the Constitution and laws of this State, or of the United States, for the sole benefit of said company,"-possesses banking powers; and even after the main object of their incorporation has been accomplished, they may continue the banking business. So held, where statutes passed subsequent to the charter recognized the corporation as a bank. N. Y. Supreme Ct. 1832, People. Manhattan Bank, 9 Wend. 351, 383. 10. The right to make loans by way of As to the power of a religious corporation in Ohio to engage in the business of banking,-see Huber v. German Congregation, 16 Ohio St. 871. discount, and to lend upon bills, bonds, notes, and mortgages, is conveyed to a savings institution, by a clause in the charter conferring the power to invest deposits, made with it, in public stocks or other securities. Md. Ct. of Appeals, 1838, Duncan v. Maryland Savings Institution, 10 Gill & J. 299; and see Gee v. Alabama Life Ins. & Trust Co. 13 Ala. 579. See CHARTER; POWERS. 11. What will not. A grant of a portion of the ordinary banking powers,-e. g. a grant to a life insurance and trust company, of a power "to buy and sell drafts and bills of exchange,"―does not confer the power to issue paper designed to circulate as money. Ohio Supreme Ct. 1839, Matter of Ohio Life Ins. & Trust Co. 9 Ohio, 291; Md. Ct. of Appeals, 1838, Duncan v. Maryland Savings Institution, 10 Gill & J. 299. 12. Incorporation for the sole purpose of insurance business, with power to invest capital in stocks, excludes, by implication, the power to discount notes by way of loan. N. Y. Supreme Ct. 1324, N. Y. Fire Ins. Co. v. Ely, 2 Cow. 679. And see Utica Ins. Co. v. Scott, 8 Id. 709. 13. The charter of an insurance company required its stock to be paid for in cash, and the capital to be invested in public stocks, or bonds and mortgages, before it should commence business; and in consequence of the difficulty of compliance with these requisites, an amendatory act was passed, enabling the president and directors to regulate the amount and terms of payment for the stock subscribed or to be subscribed, and the investment thereof. Held, that this did not confer banking powers, although there was no express prohibition in the original charter; mere authority to invest does not confer banking powers. N. Y. V. Chan. Ct. 1833, Scott v. Depeyster, 1 Edw. 513. 14. The charter of an insurance company, in authorizing the company to receive money on deposit, "and to give acknowledgments for deposits in such manner and form as they may deem convenient and necessary to transact such business," does not authorize the company to issue certificates of deposit to circulate as money, and with the intent that they shall so circulate. Ala. Supreme Ct. 1858, Bliss v. Anderson, 31 Ala. 612. 15. Banking powers, to be exercised by corporations, must be expressly granted; nor can they be inferred from such a general | ciation (which is subject to the approval of the grant of power in the charter, as to hold comptroller); 2. Its proposed place of business; 3. The amount of its stock, and number of shares; any estate, real or personal, and the same to 4. The names and residences of the shareholders sell, grant, dispose of, or bind by mortgage, and number of shares held by each; &c. Ib. § 6. or in such other manner as they shall deem most proper for the best interest of the corporation." Ohio Supreme Ct. 1841, State v. Granville Alexandrian Society, 11 Ohio, 1; State v. Washington Social Library Co. 11 Ohio, 96: and see Blair v. Perpetual Ins. Co. 10 Mo. 559. 21. The corporate powers defined. An association formed under the act shall have power to adopt a corporate seal, and shall have succes sion by the name designated in the organization certificate, for 20 years, unless it is sooner dissolved or its franchise is forfeited. "By such name it may make contracts, sue and be sued, complain and defend, in any court of law and equity, as fully as natural persons; it may elect or appoint directors, and by its board of directors appoint a president, vice-president, cashier, and them and fix the penalty thereof, dismiss said offiother officers, define their duties, require bonds of cers or any of them at pleasure, and appoint others to fill their places, and exercise under this act all such incidental powers as shall be neces 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 exchange, coin, and bullion; by loaning money on personal security; by obtaining, issuing, and circulating notes according to the provisions of this act; and its board of directors shall also have power to define and regulate by by-laws, not inconsistent with the provisions of this act, 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 all the privileges granted by As to Banks for Savings, see SAVINGS exercised and enjoyed; and its usual business this act to associations organized under it shall be 16. A charter containing no allusion to banking powers does not confer them by implication from the fact that it creates a corporation with a money capital; and whether banking was or was not a franchise at the time is not material. Ala. Supreme Ct. 1828, State v. Stebbins, 1 Stew. 299. 17. A charter creating a library company a corporation and giving it a capacity of suing and being sued, a power to make bylaws, and the power to make contracts, and to dispose of any real and personal estate, in any mode the corporation may deem most proper, confers no authority to exercise the franchise of banking. Ohio Supreme Ct. 1841, State v. Washington Social Library Co. 11 Ohio, 96. BANKS. II. THE NATIONAL BANKING SYSTEM. sary shall be transacted at an office or banking-house located in the place specified in its organization certificate." Ib. § 8. 22. Suits against national banks. National 18. The statute. The organization and conduct of national banks are chiefly regulated by the banks doing business in one State, are not, as act of Congress of June 3, 1864, 13 U. S. Stat. at such, exempt from liability to be sued in the L. 99; and by regulations and decisions promul- courts of another State. The general provigated by the comptroller of the currency, to sion of section 8,—that they may be sued in whom, by that act, the duty of superintending the execution of laws of Congress respecting the any court,-are not restricted by the permisissue and regulation of a national currency se- sive language of section 57,-that proceedcured by United States bonds, is entrusted. The more important general provisions of that act, relating to the organization of national banks, are as follows: 19. Associations authorized. Associations for carrying on the business of banking may be formed by any number of persons, not less than five. They must enter into articles of association, stating in general terms the object for which the association is formed, and other provisions, adopted for the regulation of the business of the association and the conduct of its affairs, which articles shall be signed by the persons uniting to form the association, and a copy of them forwarded to the comptroller of the currency, to be filed and preserved in his office. Act of Congress of June 3, 1864, § 5. 113 U. S. Stat. at L. 99. 20. Requisites of “organization certificate." The associates must make, acknowledge and transmit to the comptroller an "organization certificate;" specifying, 1. The name of the asso ings against them may be had in courts of the United States. The latter section was intended to give the federal courts jurisdiction they might not otherwise have had. N. Y. Supreme Ct. Sp. T. 1867, Cooke v. State National Bank of Boston, 3 Abb. Pr. N. S. 339. 23. Qualifications and oath of directors. "The affairs of every association shall be managed by not less than five directors, one of whom shall be the president. Every director shall, during his whole term of service, be a citizen of the United States; and at least three-fourths of the directors shall have resided in the State, Territory, or District, in which such association is located, one year next preceding their election as directors, and be residents of the same during their continuance in office. Each director shall own, in his own right, at least ten shares of the capital stock of the association of which he is a |