Independent Bankers Ass'n of America v. Clarke, s. 90-1243W

• Decision Date: 29 October 1990
• Docket Number: 90-1244WM,Nos. 90-1243W,s. 90-1243W
• Citation: 917 F.2d 1126
• Parties: INDEPENDENT BANKERS ASSOCIATION OF AMERICA, Missouri Independent Bankers Association, and The Callaway Bank, Appellants, v. Robert L. CLARKE, Comptroller of the Currency of the United States, and First National Bank & Trust Co., Columbia, Missouri, Appellees. STATE OF MISSOURI EX REL. Thomas B. FITZSIMMONS, Commissioner of Finance, Appellant, v. Robert L. CLARKE, Comptroller of the Currency of the United States, and First National Bank & Trust Co., Columbia, Missouri, Appellees.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1126

917 F.2d 1126

59 USLW 2285

INDEPENDENT BANKERS ASSOCIATION OF AMERICA, Missouri

Independent Bankers Association, and The Callaway

Bank, Appellants, v.Robert L. CLARKE, Comptroller of the Currency of the United

States, and First National Bank & Trust Co.,

Columbia, Missouri, Appellees.

STATE OF MISSOURI EX REL. Thomas B. FITZSIMMONS,Commissioner of Finance, Appellant, v.Robert L. CLARKE, Comptroller of the Currency of the United

States, and First National Bank & Trust Co.,

Columbia, Missouri, Appellees.

Nos. 90-1243WM, 90-1244WM.

United States Court of Appeals Eighth Circuit.

Submitted Oct. 8, 1990.

Decided Oct. 29, 1990.

Leonard Rubin of Washington, D.C., for appellantIndependent Bankers Assoc.

Michael L. Boicourt, Asst. Atty. Gen., Jefferson City, Mo. for appellantState of Mo.

Vaughan Finn of U.S. Dept. of Justice, Washington, D.C., for appellee.

Before ARNOLD and FAGG, Circuit Judges, and WATERS, ^*District Judge.

ARNOLD, Circuit Judge.

This case concerns the power of the Comptroller of the Currency to authorize national banks located in Missouri to establish branches outside their home counties.In general, the McFadden Act, 12 U.S.C. Sec. 36, authorizes national banks to establish branches only to the extent that state banks within the same state are allowed to branch by state law.In Missouri, with exceptions not here relevant, state banks may not establish branches outside their home counties.Missouri state-chartered savings and loan associations, however, are allowed to branch without geographic restriction, and the McFadden Act, 12 U.S.C. Sec. 36(h), provides that the words "State banks"

shall be held to include trust companies, savings banks, or such other corporations or institutions carrying on the banking business under the authority of State laws.

The Comptroller, applying what has come to be called a "functional" definition of "State banks," takes the view that Missouri state-chartered savings and loan institutions are "carrying on the banking business under the authority of" Missouri law, as that phrase is used in the statute, and has therefore authorized a national bank in Missouri to establish branches outside its home county, notwithstanding the fact that state banks, properly so called, could not do so.

The District Court¹ upheld the Comptroller's action in a series of opinions.Independent Bankers Association of America v. Clarke, 716 F.Supp. 1238(W.D.Mo.1989), summary judgment for defendant entered, 743 F.Supp. 687(W.D.Mo.1989).A motion for post-judgment relief was denied, and these appeals followed.Largely for the reasons given in the District Court's well-organized and well-written opinions, we affirm.

I.

This case arises out of the efforts of the First National Bank & Trust Company of Columbia, Missouri, to establish two branches.In 1987, it applied to the Comptroller of the Currency for permission to establish branches in a supermarket in Jefferson City, Missouri, and in a grocery store in Fulton, Missouri, both outside its home county.The Commissioner of Finance of Missouri, the state official charged with the administration of state laws related to banks, opposed the applications.On January 26, 1989, the Comptroller approved them.Two suits challenging this action were then filed in the District Court, one by the State of Missouri, acting through the Commissioner of Finance, and the other by the Independent Bankers Association of America, the Missouri Independent Bankers Association, and The Callaway Bank, a state bank located in one of the counties into which First National Bank wished to branch.

At bottom, the issue is the interpretation of a federal statute, the McFadden Act, first enacted in 1927 and significantly amended in 1933.In its present form, 12 U.S.C. Sec. 36, the Act provides, in pertinent part, as follows:

A national banking association may, with the approval of the Comptroller of the Currency, establish and operate new branches ... at any point within the State in which said association is situated if such establishment and operation are at the time authorized to State banks by the statute law of the State in question by language specifically granting such authority affirmatively and not merely by implication or recognition....

12 U.S.C. Sec. 36(c).And, as previously noted, 12 U.S.C. Sec. 36(h) provides that the words "State banks"

shall be held to include trust companies, savings banks, or other such corporations or institutions carrying on the banking business under the authority of State laws.

Essentially, the Comptroller's position is that, in Missouri, state-chartered savings and loan institutions are, as a practical matter, "carrying on the banking business under the authority of State laws," because they are engaged in providing what amount to checking accounts, and in making commercial loans, much in the way commercial banks do.Traditionally, of course, and originally, savings and loan associations were primarily created to provide a source of credit for home-mortgage financing.They did not accept demand deposits, nor did they make loans on security other than residential real estate.But, as everyone with a nodding acquaintance with the modern development of the financial industry knows, the clear, bright-line distinctions between commercial banks and savings and loans have, over the years, gradually become blurred.Especially since the enactment of the Garn-St. Germain Depository Institutions Act of 1982, Pub.L. No. 97-320,12 U.S.C. Sec. 1464, savings and loans have increasingly engaged in activities once thought to be the private preserve of commercial banks or trust companies.The record shows that this national development has occurred also in Missouri, though the parties dispute its extent.We need not detail the facts of competition between commercial banks and savings and loan associations in Missouri, which are well set forth in the District Court's opinions.It is sufficient to say that the Comptroller concluded that Missouri savings and loan associations had effectively become "State banks" for McFadden Act purposes.The question we must decide is whether to approve this interpretation of the statute.

The first issue is our scope of review: how much deference must be paid (if any) to the Comptroller's interpretation of the National Bank Act, as amended by the McFadden Act?The plaintiffs, the parties attacking the Comptroller's action here, rely heavily on our opinion in Dakota National Bank & Trust Co. v. First National Bank & Trust Co. of Fargo, 554 F.2d 345(8th Cir.), cert. denied, 434 U.S. 877, 98 S.Ct. 229, 54 L.Ed.2d 157(1977).There, in discussing the interpretation of the term "State banks" by the Comptroller, we did say, as plaintiffs emphasize, that the issue was one of statutory interpretation to be decided de novo by the courts.A panel of this Court may not overrule or ignore a previous panel opinion.In this instance, however, the Supreme Court, in a number of intervening decisions, has made clear that the de novo standard set out in Dakota National Bank is not the correct approach.The leading case is Chevron U.S.A. Inc. v. Natural Resources Defense Council, 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694(1984).There, the Court said:

When a court reviews an agency's construction of the statute which it administers, it is confronted with two questions.First, always, is the question whether Congress has directly spoken to the precise question at issue.If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress.If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute, as would be necessary in the absence of an administrative interpretation.Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute.

467 U.S. at 842-43, 104 S.Ct. at 2781(footnotes omitted).In a footnote, the Supreme Court added that a court"need not conclude that the agency construction was the only one it permissibly could have adopted to uphold the construction, or even the reading the court would have reached if the question initially had arisen in a judicial proceeding."Id. at 843 n. 11, 104 S.Ct. at 2782 n. 11.This Court has recently had occasion to apply the Chevron standard in a case involving the McFadden Act itself.In the course of upholding an action of the Comptroller, we said, among other things: "The Comptroller of the Currency's interpretation of the National Bank Act is entitled to great deference.Clarke v. Securities Indus. Association, 479 U.S. 388, 403-04[107 S.Ct. 750, 759-60, 93 L.Ed.2d 757](1987)."Arkansas State Bank Commissioner v. Resolution Trust Corp., 911 F.2d 161, 174(8th Cir.1990).

If the Chevron standard is to be applied, and we are convinced that it is, there can be only one result here.The statute is hardly clear on its face.The financial industry is complex and changing.Distinctions long considered basic are fading...