Harriman Nat Bank v. Seldomridge

• Decision Date: 03 March 1919
• Docket Number: No. 173,173
• Citation: 39 S.Ct. 244,249 U.S. 1,63 L.Ed. 443
• Parties: HARRIMAN NAT. BANK v. SELDOMRIDGE
• Court: U.S. Supreme Court

249 U.S. 1

39 S.Ct. 244

63 L.Ed. 443

HARRIMAN NAT. BANK

v SELDOMRIDGE.

No. 173.

Argued Jan. 31, 1919.

Decided March 3, 1919.

Messrs. Charles E. Hughes and Henry B. Wesselman, both of New York City, for plaintiff in error.

[Argument of Counsel from pages 2-3 intentionally omitted] Messrs. Stuart G. Gibboney and William A. Barber, both of New York City, for defendant in error.

[Argument of Counsel from pages 4-6 intentionally omitted] Mr. Chief Justice WHITE delivered the opinion of the Court.

Following the failure in March, 1915, of the Mercantile National Bank of Pueblo, Colo., the receive appointed by the comptroller commenced this suit to recover from the Harriman National Bank of New York City $30,000 alleged to be due to the Mercantile Bank. On issue joined before a jury, the court, after refusing a request of the Harriman National Bank for a peremptory instruction directing a verdict in its favor, granted a request of like character made by the receiver, and a judgment on the resulting verdict for the amount claimed was entered.

The case is before us on error to the judgment of the court below affirming that of the trial court, our jurisdiction to review resulting because the case from its inception involved the enforcement of the National Banking Act, and therefore, was not dependent in the trial court solely upon diversity of citizenship. Auten v United States National Bank, 174 U. S. 125, 141, 19 Sup. Ct. 628, 43 L. Ed. 920; International Trust Co. v. Weeks, 203 U. S. 364, 366, 27 Sup. Ct. 69, 51 L. Ed. 224.

The case is this: W. B. Slaughter, through stock ownership, controlled the Mercantile National Bank of Pueblo, Colo. He was president and his son, C. C. Slaughter, was cashier. Prior to 1915, Slaughter, the president, removed his residence from Pueblo to Texas, engaging there in the cattle business and leaving his son, the cashier, in complete control of the Mercantile Bank and of all its affairs. W. B. Slaughter was also the president of the Silverton National Bank of Silverton, Colo., and controlled the affairs of that bank by the ownership of a majority of its stock. At Silverton there was another national bank carrying on business, the First National, the majority of whose stock was owned by one Thatcher.

The correspondent of the Mercantile Bank in New York City was the Harriman National, with which it had a checking account. On January 28, 1915, C. C. Slaughter, the cashier of the Mercantile, dictated a letter to the Harriman which was dated at Pueblo and written on the letter head of the Mercantile Bank, purporting to be from W. B. Slaughter, whose signature was affixed by a rubber stamp. By this letter its assumed writer, after referring to his ownership and control of the Silverton National, stated his purpose to buy out the interest of Thatcher in the First National Bank of Silverton and after doing so to consolidate the two banks, and requested a loan of $30,000 to enable him to accomplish the purpose. It was stated that it was proposed to evidence the loan by a note at 60 days, to be signed by the writer, W. B. Slaughter, and by his son C. C. Slaughter, if the bank so desired, and to secure the note by the pledge of 500 shares of the Mercantile and 400 shares of the First National of Silverton. The Harriman Bank received this letter on the 1st of February and at once telegraphed W. B. Slaughter, president of the Mercantile Bank at Pueblo that, whenever desired, the Harriman would be willing to make the loan, as requested. On the same day the bank wrote a letter to W. B. Slaughter, president at Pueblo, but marked it personal, repeating and confirming the telegram, and inclosing a blank form of collateral note to be executed and sent to the bank with the collateral when the money was desired.

The telegram of the 1st of February announcing the willingness of the Harriman Bank to make the loan having come into the hands C. C. Slaughter on the day it was sent, he ordered a seal to be made which he said was intended as the seal of the First National Bank of Silverton, and on the 5th of February bought from a printer blank forms of certificates of stock. On the next day, Saturday, the 6th, purporting to act as agent of W. B. Slaughter, C. C. Slaughter bought from Thatcher his interest in the First National of Silverton, and gave a check in the name of W. B. Slaughter and as his representative, on the Mercantile National, for $35,000 in part payment. On Sunday, February 7th, C. C. Slaughter caused a letter to be prepared falsely purporting to be written and signed by W. B. Slaughter, acknowledging the receipt of the telegram sent by the Harriman Bank on the 1st and asking that the loan be consummated. In this letter there was returned the collateral note which the bank and sent for execution,...