American Bank & Trust Co. v. Federal Reserve Bank of Atlanta

• Decision Date: 02 November 1922
• Docket Number: 3906.
• Parties: AMERICAN BANK & TRUST CO. et al. v. FEDERAL RESERVE BANK OF ATLANTA et al.
• Court: U.S. Court of Appeals — Fifth Circuit

284 F. 424

AMERICAN BANK & TRUST CO. et al. v. FEDERAL RESERVE BANK OF ATLANTA et al.

No. 3906.

United States Court of Appeals, Fifth Circuit.

November 2, 1922

Alex. W. Smith, of Atlanta, Ga. (Orville A. Park, of Macon, Ga and Smith, Hammond & Smith and Theodore H. Smith, all of Atlanta, Ga., on the brief), for appellants.

Hollins N. Randolph and R. S. Parker, both of Atlanta, Ga., and John W. Davis and M. B. Angell, both of New York City, for appellees.

Before WALKER and BRYAN, Circuit Judges, and SHEPPARD, District Judge.

WALKER Circuit Judge.

Except as to a feature of the bill mentioned below, nothing has occurred to require a revision of or departure from the conclusions stated in the opinion delivered by this court in this case when it was here on a former appeal. American Bank & Trust Co. v. Federal Reserve Bank of Atlanta, 269 F. 4. What was held by the Supreme Court to show the existence of a right to relief under the general prayer for relief was the part of the bill containing allegations to the effect that, in pursuance of the alleged policy of the Federal Reserve Board to bring about the collectibility by banks of bank checks at par, the appellee Reserve Bank and its officers intended to accumulate, until they reach a large amount, checks upon banks of the class to which the appellant banks belong, and then to cause them to be presented for payment in cash over the counter, or by other devices detailed to require payment in cash in such wise as to drive the drawees out of business, or force them, if able, to submit to the scheme of making bank checks collectible at par. American Bank & Trust Co. v. Federal Reserve Bank, 256 U.S. 350, 41 Sup.Ct. 499, 65 L.Ed. 983.

The conduct which the Supreme Court decided to be wrongful and subject to be enjoined was the alleged threatened accumulation of checks for the purpose of using them in the manner alleged. It was not decided or intimated that the appellee bank would be guilty of any actionable wrong by merely presenting or causing to be presented bank checks held by it to the drawees for payment in cash over the counter. The alleged accumulation of checks for the purpose charged was an essential feature of the alleged conduct which was decided to be wrongful. We are not of opinion that a bank, in receipt for collection of checks on other banks, is guilty of an abuse of its right as such holder when, in due course with reasonable promptness, without designed delay or accumulation, and in proper manner, it presents, or causes to be presented, those checks to the drawees for payment in cash. In so doing the collecting bank would be exercising its right as the holder of checks received by it for collection and would not be guilty of an abuse of that right for an unlawful purpose. If the holder of the checks is guilty of no wrong, the fact that the payer is inconvenienced by having to pay in cash would not give the latter a valid ground of complaint. Inconvenience resulting to one party from another's exercise of a right in a lawful way does not give the former a right of action. The most that the evidence relied on by the appellants tended to prove was that at and prior to the time of filing the bill the appellee bank intended or proposed to deal in the just-stated manner with checks received by it for collection, when the drawees did not consent to remit at par, and that it was after this suit was brought that appellee bank manifested its willingness to allow payment of such checks to be made either in cash or in acceptable exchange. The trial judge specifically found that--

'The charge that the Federal Reserve Bank at Atlanta would accumulate checks upon country or nonmember banks until they reach a large amount, and then cause them to be presented for payment over the counter, so as to compel the plaintiffs to maintain so much cash in their vaults as to drive them out of business, or...