Frelinghuysen v. Baldwin

• Citation: 12 F. 395
• Parties: FRELINGHUYSEN, Receiver, etc., v. BALDWIN and others.
• Decision Date: 03 June 1882
• Court: U.S. District Court — District of New Jersey

12 F. 395

FRELINGHUYSEN, Receiver, etc., v. BALDWIN and others.

United States District Court, D. New Jersey.

June 3, 1882

A. Q Keasbey, U.S. Dist. Atty., for receiver.

Courtlandt & R. Wayne Parker, for defendants.

NIXON D.J.

This case arises upon demurrer to a plea. Frederick Frelinghuysen the receiver of the Mechanics' National Bank of Newark has brought suit against Oscar L. Baldwin, the late cashier and his sureties upon their bond to the corporation conditioned for the faithful discharge of his duties as cashier. The plea demurred to avers that all the parties to the bond are citizens of the state of New Jersey, and that the court has no jurisdiction in such a case. By the provisions of the national banking act the comptroller of the currency is authorized, with the concurrence of the secretary of the treasury, under certain circumstances not necessary to be here stated, to appoint a receiver to wind up the affairs of the association. Section 5191 of the Revised Statutes. Such receiver, after giving the bond and security required by the comptroller, takes possession of the books, records, and assets of every description of the association; collects all debts, dues, and claims belonging to it; and under the direction of a court of competent jurisdiction may sell or compound all bad or doubtful debts, and dispose of all the real and personal property; and, when necessary to pay the debts of the association, may enforce the individual liability of the stockholders. His duties are to convert all the assets into money and to pay the same to the treasurer of the United States, subject to the order of the comptroller, and to make report to that officer of all his proceedings. Section 5234. He is thus the agent of the United States for the performance of specified duties, and by section 380 of the Revised Statutes all his suits should be conducted by the district attorney of the United States for the district in which they are pending.

The discharge of these duties necessarily implies the right of appealing to some court for aid; and the question raised by the demurrer is whether he may go in his own name into the district or circuit court of the United States for the collection of the debts or claims of the association. The fourth subdivision of section 563 of the Revised Statutes confers upon the district courts jurisdiction of all suits at common law brought by the United States, or by any officer thereof authorized by a law of congress to sue. This is a substantial re-enactment of the fourth section of the act of March 3, 1815. The present suit is one at common law instituted by a receiver, who is authorized by law to sue. He is clearly within the statute, if he is, in any proper sense, an officer of the government. Receivers are always regarded as officers of some sort. When appointed by a court they are the officers of the court. When appointed by lawful authority to do the work which congress charged the government to perform, why should they not be considered officers of the government? The second subdivision of the second section of the second article of the constitution of the United States has reference to the appointment of officers of the United States, and the last clause authorizes congress by law to vest the appointment of such inferior officers as they think proper in the president alone, in the courts of law, or in the heads of departments. The secretary of the treasury is the head of the treasury department. Section 233. By section 324 the comptroller of the currency is the chief officer of a bureau of the treasury department, charged with the execution of all laws passed by congress relating to the issue and regulation of a national currency, secured by United States bonds. This officer, in cases of the insolvency of the association, appoints a receiver, through whose instrumentality the assets are turned into the treasury of the United States; but the comptroller performs this, as well as all other duties, under the...