Ex parte Naegele

• Decision Date: 15 March 1924
• Docket Number: 5500.
• Citation: 224 P. 269,70 Mont. 129
• Parties: EX PARTE NAEGELE.
• Court: Montana Supreme Court

224 P. 269

70 Mont. 129

EX PARTE NAEGELE.

No. 5500.

Supreme Court of Montana

March 15, 1924

Application by Fred Naegele for a writ of habeas corpus against James M Barnes, sheriff of Lewis and Clark county. Petitioner discharged.

Gunn Rasch & Hall and Walsh & Nagle, all of Helena, for petitioner.

J. R Wine, of Helena, opposed.

GALEN J.

This is an original proceeding in habeas corpus. The petition is addressed to Mr. Chief Justice Callaway. Upon its filing and presentation, an order was duly made and entered by him on March 5, 1924, directing that a writ of habeas corpus issue to James M. Barnes, as sheriff of Lewis and Clark county requiring the latter to have the body of the petitioner, Fred Naegele, before this court on March 10, 1924. The writ was issued accordingly on the date of the order, and the cause was heard by the court, pursuant to the order, upon the petition, the sheriff's return, and the petitioner's objections to the return. There are no disputed questions of fact.

By indictment returned by the grand jury of Lewis and Clark county, the petitioner and others are charged with the crime of felony, in that on the 1st day of May, 1923, they, being all the directors of the Banking Corporation of Montana, "did willfully, unlawfully and feloniously receive on deposit and accept and permit and connive at the receiving and accepting on deposit from one John T. Smith, a certain sum of money and paper circulating as money, to wit, currency, to the amount of one hundred dollars ($100.00), * * * lawful money of the United States of America, * * * each of them then and there knowing, or having reason to know, of such unsafeness and insolvency of * * * the Banking Corporation of Montana, * * * contrary to the form, force and effect of the statute," etc.

The petition recites, among other things, that the petitioner is unlawfully restrained of his liberty by the above-named sheriff, in that the indictment returned by the grand jury on January 21, 1924, purporting to charge the petitioner and others therein named with the crime of felony, is predicated upon section 11443 of the Revised Codes of 1921, which had been repealed long prior to May 1, 1923, the date of the alleged commission of the offense charged in the indictment. The return of the sheriff admits that at the time of the issuance and service of the writ he held the petitioner in custody as a prisoner, but justifies himself by reason of a warrant issued by the district court of Lewis and Clark county, for petitioner's arrest. Further, it is admitted that the petitioner, jointly with others, is by indictment charged with a violation of the banking laws of the state of Montana, under section 11443 of the Revised Codes of 1921, as the same existed at the time of the acts complained of and at the time of the presentation and filing of the indictment and at the time of the issuance of the warrant for petitioner's arrest. It is denied that this law was repealed on May 1, 1923, or at any other time.

The determinative question is whether section 11443 of the Revised Codes of 1921 was a valid and subsisting law on the date of the offense alleged by the indictment. That section reads:

"No bank, banking house, exchange broker, individual banker, deposit office or firm, company, corporation, or party engaged in the banking, broker, exchange, loan or deposit business shall accept or receive on deposit, or for safe-keeping, or to loan, with or without interest from any person, any money or any bills, notes or any paper circulating as money, or any notes, drafts, bills of exchange, bank checks or other commercial paper, for safe-keeping or for collection, when such bank, banking house, exchange broker, individual banker, deposit office, firm, company, corporation, or party is unsafe and insolvent. If any such bank, banking house, exchange broker, individual banker, deposit office, or firm, company, corporation or party shall receive or accept on deposit, or for safe-keeping or to loan, with or without interest from any persons, any money or any bills of exchange, bank checks or other commercial paper, drafts, notes or other paper circulating as money, or any notes, for safe-keeping, or for collection, when unsafe or insolvent, any officer, director, cashier, manager, principal, agent, clerk, party or managing party, thereof, knowing or having reason to know, of any such unsafeness or insolvency, who shall knowingly receive or accept, be accessory to, or permit or connive at, or receive or accept on deposit therein or thereby, any such deposits, money or property as aforesaid, shall be guilty of a felony and shall be punished by imprisonment in the state penitentiary not less than one year or more than twenty years."

The history of this legislation is conclusive with respect to its validity. By section 986 of the Penal Code of 1895 it was provided:

"Every officer, agent, teller or clerk of any bank, and every individual banker or agent, teller or clerk of any individual banker, who receives any deposits, knowing that such bank or association or banker is insolvent, is guilty of a felony."

And there was no other provision in the Codes of 1895 relative to the acceptance of deposits while a bank was in an insolvent condition.

In 1899 an act was passed and approved (substitute for Senate Bill No. 87, Laws of 1899, pp. 111, 112), which was carried forward into the Codes of 1907 as section 4007, reading as follows:

"Whenever any banking corporation, trust deposit and security company or savings banks organized under the laws of this state shall be insolvent or impaired condition in the manner described and set forth in section 4004 (2) of this act, such banking corporation, trust deposit and security company or savings bank shall not accept or receive on deposit any money, bank bills or notes, United States treasury notes or currency, or other notes, bills or drafts, circulating as money or currency, or transact any other business in connection with its operations, except as trustee for the depositors and parties transacting business with them, and it or they shall keep all such deposits of money, bills or notes, or United States treasury notes or currency, or other notes, bills or drafts, circulating as money or currency, separate and apart from the general assets of the bank, from and after the date such notice is given to its officers and stockholders, as set forth in section 4004 (2), of this act, and which trust deposits shall be kept separate and apart from the general assets of the bank until such impairment or insolvency has been made good, when such deposits received in 'trust' may be transferred to the general assets of the bank on and by written consent of the state examiner; and further provided that, in the event of such impairment or insolvency be not made good or removed within the period stated by the notice required as set forth in section 4004 (2), of this act, then any and all such 'trust deposits' shall be returned to the depositors making them; and further provided, that any officer, director, cashier, manager, member, partner or managing partner thereof who shall knowingly accept or receive, be accessory to or permit or connive at the receiving or accepting of such trust deposits, except in the manner hereinbefore set forth in this section, shall be deemed guilty of a felony, and upon conviction thereof, shall be punished by a fine not exceeding ten thousand dollars, or by imprisonment in the State Penitentiary not exceeding five years, or by both fine and imprisonment as aforesaid."

By chapter 84 of the Laws of 1907 attempt was made specifically to amend section 986 of the Penal Code of 1895, by an act entitled "An act relating to banking, brokerage, exchange, loan and deposit business and amending section 986 of the Penal Code of the State of Montana," which act is now section 11443 of the Revised Codes of 1921, upon which the indictment against the petitioner is based.

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