Citizens National Bank of Maplewood v. Saxon

• Decision Date: 30 December 1965
• Docket Number: No. 65 C 32(1).,65 C 32(1).
• Citation: 249 F. Supp. 557
• Parties: CITIZENS NATIONAL BANK OF MAPLEWOOD, a national banking association, Webster Groves Trust Company, the Kirkwood Bank, First Security Bank in Kirkwood, Big Bend Bank, Maplewood Bank & Trust Company, Peoples State Bank of Maplewood, each banking or trust corporation organized under the laws of the State of Missouri, Plaintiffs, v. James J. SAXON, Comptroller of the Currency of the United States, and West Side National Bank, a national banking association, Defendants.
• Court: U.S. District Court — Eastern District of Missouri

249 F. Supp. 557

CITIZENS NATIONAL BANK OF MAPLEWOOD, a national banking association, Webster Groves Trust Company, the Kirkwood Bank, First Security Bank in Kirkwood, Big Bend Bank, Maplewood Bank & Trust Company, Peoples State Bank of Maplewood, each banking or trust corporation organized under the laws of the State of Missouri, Plaintiffs, v. James J. SAXON, Comptroller of the Currency of the United States, and West Side National Bank, a national banking association, Defendants.

No. 65 C 32(1).

United States District Court E. D. Missouri, E. D.

December 30, 1965.

Harry G. Neill, Jr., Kappel & Neill, St. Louis, Mo., for Citizen's Nat. Bank of Maplewood.

Thomas V. Connelly, Bryan, Cave, McPheeters & McRoberts, St. Louis, Mo., for Webster Groves Trust Co. and others.

Irwin Goldbloom, Washington, D. C., Richard D. FitzGibbon, Jr., U. S. Atty., and John A. Newton, Ass't. U. S. Atty., St. Louis, Mo., John W. Douglas, Ass't. Atty. Gen., and Charles Shea, Atty., Law Dept., Comptroller of Currency, Washington, D. C., for James J. Saxon.

Wm. H. Biggs and Wm. C. Dale, Jr., St. Louis, Mo., for West Side Nat. Bank.

HARPER, Chief Judge.

The plaintiffs in this action are seven commercial banks (six state banks and one national bank), doing business in St. Louis County at banking houses located within an approximately four-mile radius from the newly established place of business of the West Side National Bank, one of the defendants.

The plaintiffs seek a declaratory judgment and an injunction to overturn the approval of the Comptroller of the Currency of the United States regarding the issuance of the charter for the West Side National Bank. The sole allegation of the plaintiffs is that the Comptroller's approval is invalid because of his failure to grant the plaintiffs a formal hearing in the matter before the charter was issued.

The testimony before the court, including the exhibits and pleadings, disclose that the defendant, West Side National Bank, filed an application for a charter as a national bank with the Comptroller on July 31, 1964. Pursuant to the statute and regulations controlling such applications (12 U.S.C.A. § 26; 12 C.R.F. 4.2) a national bank examiner made an investigation concerning the application, and the plaintiffs learned of the submission of the application.

On August 21, 1964, plaintiffs notified the Comptroller of their protests concerning the application and requested a hearing. On August 27, 1964, William B. Camp, Deputy Comptroller of Currency, acknowledged the letter and offered to "discuss the proposal" with the plaintiffs. This discussion was held in Washington, D. C., on October 6, 1964. At this meeting the plaintiffs again made a request for a formal hearing. No formal hearing was held, and the application of the defendant, West Side National Bank, was approved by the Comptroller on December 12, 1964.

As was stated above, the sole issue involved is whether the plaintiffs were entitled as a matter of law to a formal hearing. The only authority in the statute that empowers the Comptroller to hold a hearing if a hearing is required is contained in 12 U.S.C.A. §§ 26 and 27. These sections state that the Comptroller shall conduct investigations to determine the appropriateness of granting a charter for a national bank. There is no statutory requirement that a hearing, formal or otherwise, must be conducted. The words used by Congress are:

"If, upon a careful examination of the facts so reported, and of other facts which may come to the knowledge of the Comptroller, whether by means of a special commission appointed by him for the purpose of inquiring into the condition of such association, or otherwise * * *." 12 U.S.C.A. § 27.

"Examination" and "inquiring" are required, not "hearings". 12 C.F.R. 4.2 sets out the matters that the Comptroller shall investigate. In line with the statutory language, and in the spirit of basic fairness, the Comptroller does provide for hearings in some instances. These are controlled by the discretion of the Comptroller. 12 C.F.R. 4.12(d). There is no requirement for a hearing in the statute as there is in many of the other statutes creating Federal agencies. (See, for example, 49 U.S.C.A. § 13a (2), dealing with a hearing before the I.C.C. regarding discontinuance...