463 F.2d 595 (7th Cir. 1972), 71-1463, First Nat. Bank of Crown Point v. Camp

Docket Nº:71-1463.
Citation:463 F.2d 595
Party Name:The FIRST NATIONAL BANK OF CROWN POINT, a national banking association, and the Commercial Bank of Crown Point, a State of Indiana banking corporation, Plaintiffs-Appellants, v. William B. CAMP, Comptroller of the Currency of the United States of America, and Mercantile National Bank of Indiana, a national banking association, Defendants-Appellees.
Case Date:July 07, 1972
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit
 
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Page 595

463 F.2d 595 (7th Cir. 1972)

The FIRST NATIONAL BANK OF CROWN POINT, a national banking association, and the Commercial Bank of Crown Point, a State of Indiana banking corporation, Plaintiffs-Appellants,

v.

William B. CAMP, Comptroller of the Currency of the United States of America, and Mercantile National Bank of Indiana, a national banking association, Defendants-Appellees.

No. 71-1463.

United States Court of Appeals, Seventh Circuit.

July 7, 1972

Argued May 17, 1972.

Page 596

William Carroll, Crown Point, Ind., Fred G. Donnersberger, Hammond, Ind., for plaintiffs-appellants.

L. Patrick Gray, III, Asst. Atty. Gen., William D. Appler, Walter H. Fleischer, Joseph B. Scott, Attys., Dept. of Justice, Washington, D. C., William C. Lee, U. S. Atty., Fort Wayne, Ind., Timothy P. Galvin, Sr., and Patrick J. Galvin, Hammond, Ind., for defendants-appellees.

Before SWYGERT, Chief Judge, and KILEY and SPRECHER, Circuit Judges.

SPRECHER, Circuit Judge.

On June 23, 1970, the Comptroller of the Currency of the United States approved an application by the Mercantile National Bank of Indiana for permission to construct a branch bank in an unincorporated area adjacent to the city of Crown Point, Indiana. The appellants in this case, the First National Bank of Crown Point and the Commercial Bank of Crown Point, raised objections to Mercantile's application at the Comptroller's informal hearing on the matter and renewed their objections in an administrative review procedure before the district court. The district court granted summary judgment for the codefendants, Mercantile Bank and the United States Comptroller, and the case is before us on appeal from that decision. We affirm.

The National Bank Act, 12 U.S.C. § 36(c), provides that banks may, with the approval of the Comptroller of the Currency, establish branch offices at any location authorized by state law. 1 The Indiana statutory provision applicable to branch bank locations in Lake County, the county in which Mercantile seeks to locate its branch, is Burns' Ind. Stat. § 18-1707. That section provides in part:

In all counties having a population of less than five hundred thousand (500,000) inhabitants, according to the last preceding decennial United States census, or in counties having three (3) or more cities of the second class, except as hereinafter otherwise provided, any bank or trust company may open or establish a branch bank in any city or town within the limits of the county in which the principal office of such bank or trust company is located, if there is no bank or trust company located in such city or town.

Appellants argue that the area in which the proposed bank was to be located was not a "city or town" within the meaning of section 1707 and that, if it was a "city or town," it was by prior de facto annexation part of the city of Crown Point, and, therefore, an objectionable site for a branch bank because both appellant banks maintain their home offices in Crown Point.

I.

In support of their contention that the district court erred in finding that the proposed site was a "town" within the meaning of the Indiana statute, appellants

Page 597

note that Mercantile's 1967 application for a branch banking site in the same area was denied because the Comptroller found that at that time the area "involved did not possess sufficient viability to be considered a city or town. . . ." Appellants argue that the Comptroller's conclusion that the area had developed sufficiently since that time to be a "town" within the meaning of the statute was arbitrary and capricious. We disagree.

A review of the record discloses that substantial development had occurred during the four-year period between 1967 when the first application was denied and 1970 when this application was filed. In 1967, there existed only one 27-unit single-family residential development; a proposal to build a courthouse in Lake County was stalled at the time by litigation which rendered its future uncertain. By 1970, however, the litigation had been successfully concluded, the state legislature had enacted legislation necessary for the project, and a $15 million bond issue to finance the project had been sold. 2 Furthermore, the number of residential units had increased from 27 units to 147 single-family units, with additional construction planned on land recently purchased in the area. Although the...

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