Freeman Manuf'g. Co. of North Adams v. National Bank of the Republic of Boston

• Decision Date: 05 January 1894
• Citation: 35 N.E. 865,160 Mass. 398
• Parties: FREEMAN MANUF'G CO. OF NORTH ADAMS BROWN v. NATIONAL BANK OF THE REPUBLIC OF BOSTON et al. BROWN v. SAME.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

160 Mass. 398

35 N.E. 865

FREEMAN MANUF'G CO. OF NORTH ADAMS BROWN v. NATIONAL BANK OF THE REPUBLIC OF BOSTON et al. BROWN v. SAME.

Supreme Judicial Court of Massachusetts, Berkshire.

January 5, 1894

COUNSEL

Henry L. Dawes, Pingree, Dawes & Burke, and C.H. Williams, for appellants.

Lauriston L. Scaife and Charles M. Reed, for appellee.

OPINION

HOLMES, J.

These cases come before us on motions of the defendant bank, made under St.1883, c. 223, § 6, to annul orders of a single justice of this court, suspending, after appeal, decrees of the superior court. Those decrees dissolved preliminary injunctions which had been issued in the suits, and the injunctions now have been reinstated. They prohibit the bank from disposing of certain notes pledged to it, but, it is alleged, without right and with notice. The only question before us is whether a state court has power to issue such injunctions before final judgment.

In Rev.St.U.S. § 5242, after provisions avoiding payments made in contemplation of insolvency, etc., the section continues "And no attachment, injunction or execution, shall be issued against such association or its property before final judgment in any suit, action, or proceeding, in any state, county, or municipal court." Possibly these words, if enacted in their present connection for the first time, might be limited to insolvent banks. Raynor v. Bank, 93 N.Y. 371. But this clause is simply a codification of a proviso added to Stat.U.S.1864, c. 106, § 57, (13 Stat. 116, 117,) giving jurisdiction over banks to state, as well as to United States, courts, by Stat.U.S.1873, c. 269, § 2, (17 Stat 603.) It cannot be limited in that way. Bank v. Mixter, 124 U.S. 721, 726, 727, 8 Sup.Ct. 718. There is nothing in the context to limit it in any other. The argument is only that it is unreasonable that congress should go so far; that the presumable motive for the law was to prevent an important wheel of business being stopped; and that this motive could be satisfied by limiting the injunctions mentioned to such as would place the general assets of the bank beyond its control, by mesne process having the effect of an attachment.

But such arguments are very doubtful ground for giving words an unnatural construction. The words used are of unlimited scope. The limited interpretation gives them an unusual meaning. The prohibition, whether reasonable or not, is intelligible when we consider that, at the time when the prohibition was first passed, any plaintiff was at liberty to sue in the United States courts, and could obtain an injunction there. The fact that this power has been taken away cannot change the construction of the words. Bank v. Mixter, 124 U.S. 721, 727, 728, 8 Sup.Ct. 718. The jurisdiction and the extent of the power to be exercised by state courts depend on the permission of the United States. The wrongs likely to be done by national banks are of a pecuniary nature, and the banks usually are amply able to make good any damage which they may do, so that there is not the same necessity for preventive remedies that there is with individuals or with corporations, for whose solvency less stringent precautions are taken. We are of opinion that the language of the statute must be read in its natural sense, in accordance with what we understand to have been the view of the supreme court of the United States in Bank v. Mixter, supra.

But then it is said that this provision of section 5242 has been repealed. Evidently, this was not the opinion of the supreme court of the United States when deciding Bank v. Mixter. The contrary was decided in New York. Raynor v. Bank, 93 N.Y. 371. See, also, Safford v. Bank, 61 Vt. 373, 17 A. 748; Bank v. La Due, 39 Minn. 415, 40 N.W. 367. And we think it tolerably plain that such is not the import of the statutes relied on.

The principal one is Stat.U.S.1882, c. 290, § 4, (22 Stat. 162 163.) The section of the act of 1864, above referred to, giving jurisdiction to United States and state courts, was omitted by mistake from the Revised Statutes, although, as has been seen, the proviso as to state courts issuing injunctions was retained. This omission was corrected by Stat.U.S.1875, c. 80, (18 Stat. 320.) Then, a proviso in Stat.U.S.1882, c. 290, § 4, enacts that "the jurisdiction for suits" by or against the banks, with certain exceptions not material, "shall be the same as, and not other than, the...