First Nat Bank of Charlotte v. Morgan

• Decision Date: 11 November 1889
• Citation: 132 U.S. 141,33 L.Ed. 282,10 S.Ct. 37
• Parties: FIRST NAT. BANK OF CHARLOTTE v. MORGAN. 1
• Court: U.S. Supreme Court

132 U.S. 141

10 S.Ct. 37

33 L.Ed. 282

FIRST NAT. BANK OF CHARLOTTE v. MORGAN.¹

November 11, 1889.

Wm. E. Earle, for plaintiff in error.

J. B. Batchelor, for defendant in error.

HARLAN, J.

This action was brought in the superior court of Cleveland county, N. C., by the defendant in error against the plaintiff in error, a national banking association, established at Charlotte, Mecklenburg county, in that state. It was based upon the provision of the Revised Statutes of the United States authorizing any person, paying to any such association a greater rate of interest than the law allows it knowingly to take, receive, reserve, or charge, to recover from it, in an action in the nature of an action of debt, twice the amount of the interest so paid. Rev. St. §§ 5197, 5198.

The defendant filed an answer denying all the material allegations of the complaint, and, in addition, pleaded in bar the limitation of two years provided by congress for actions of this character. Id. § 5198.

The jury, in response to the issues submitted to them, found that the plaintiff paid, on the usurious contracts described in certain counts of the complaint, the sum of $554.28, during the two years next preceding the commencement of the action, and returned a verdict against the bank for twice that sum, namely, $1,108.56. Judgment was accordingly rendered for the latter sum in favor of Morgan.

That judgment, having been affirmed by the supreme court of North Carolina, is here for re-examination. The principal error assigned is that the only state court which, consistently with the laws of the United States, could take cognizance of this action, was one established in the county or city where the bank was located, and which had jurisdiction in similar cases.

By the ninth section of the Judiciary Act of 1789, it was provided that the district courts of the United States 'shall also have exclusive original cognizance * * * of all suits for penalties and forfeitures incurred under the laws of the United States.' 1 St. 76, 77. This provision was in force when the National Bank Act of June 3, 1864, was passed. 13 St. p. 99, §§ 8, 57. By that act it was declared that associations formed pursuant to its provisions 'may make contracts, sue and be sued, complain and defend, in any court of law and equity, as fully as natural persons,' (section 8;) and that 'suits, actions, and proceedings against any association' formed under it, '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: provided, however, that all proceedings to enjoin the comptroller under this act shall be had in a circuit, district, or territorial court of the United States, held in the district in which the association is located,' (section 57.)

Section 563 of the Revised Statutes provides that the district courts shall have jurisdiction of 'all suit for penalties and forfeitures incurred under any law of the United States;' and section 629 declares that the circuit courts of the United States shall have original jurisdiction of 'all suits by or against any banking association established in the district for which the court is held, under any law providing for national banking associations.' Section 711 defines the cases in which 'the jurisdiction vested in the courts of the United States' shall be 'exclusive of the courts of the several states,' and among such are 'all suits for penalties and forfeitures incurred under the laws of the United States.' But no subdivision of that section, in terms, embraces suits brought under the national bank law, by or against associations organized under it.

The revision omitted entirely that part of the act of 1864 (section 57) designating the particular state courts in which suits, actions, or proceedings against a national banking association might be brought. That omission was remedied by the act of February 18,1875, entitled 'An act to correct errors and to supply omissions in the Revised Statutes of the United States.' 18 St. 316, 320. By that act, section 5198 of the Revised Statutes, (title, 'National Banks,') giving the right to recover back twice the amount of the interest illegally received by a national bank, was amended by adding thereto these words: 'That suits, actions, and proceedings against any...