Lucking v. Delano

• Decision Date: 19 May 1941
• Docket Number: No. 7628.,7628.
• Citation: 74 App. DC 134,122 F.2d 21
• Parties: LUCKING v. DELANO, Comptroller of the Currency.
• Court: U.S. Court of Appeals — District of Columbia Circuit

74 App. DC 134, 122 F.2d 21 (1941)

LUCKING v. DELANO, Comptroller of the Currency.

No. 7628.

United States Court of Appeals for the District of Columbia.

May 19, 1941.

Decided May 19, 1941.

Albert W. Fox, of Washington, D. C., and William Lucking, of Detroit, Mich., for appellant.

George P. Barse, of Washington, D. C., for appellees.

Before GRONER, Chief Justice, and MILLER and RUTLEDGE, Associate Justices.

MILLER, Associate Justice.

William Alfred Lucking, who was plaintiff in the District Court and is appellant here, was a depositor in the First National Bank-Detroit at the time it closed in February, 1933. The bank was closed by the Comptroller of the Currency because it was insolvent within the meaning of the federal statutes. Appellant filed his complaint in the lower court as a class suit on behalf of all general depositors and creditors of the bank, namely, those who had, at the date of the filing of suit, received 80% of their deposits in the bank. Suit was brought against both the Comptroller of the Currency and the Receiver of the First National Bank-Detroit. Return of service upon Schram, the Receiver, indicated that service was made upon David Pine, United States Attorney for the District of Columbia. The lower court granted the motion of appellee Delano to dismiss the amended and supplemental bills of complaint, as well as his motion to quash the subpoena duces tecum; it sustained his objections to answering interrogatories filed by appellant, and granted the motion, under special appearance of appellee Schram, to quash attempted service of process upon him. The court also denied appellant's motion for a new trial.

Upon this appeal, appellant urges that the lower court failed to make findings of fact. As appellee points out, this contention is raised for the first time in this court. It was not called to the attention of the trial court; was not included in the motion for new trial; and was not included in appellant's points on appeal. But even apart from appellant's failure thus to present a reviewable question for our determination,¹ it is obvious that the trial court was not required to make findings. The motion to dismiss admitted, for the purposes of the motion, all facts well pleaded.² Rule 52(a) of the Federal Rules of Civil Procedure, 28 U.S.C.A. following section 723c, has no application to the present case as that rule relates to actions tried upon the facts without a jury. This case was not tried upon the facts, but was decided upon questions of law arising upon the motion to dismiss.

The relief sought by appellant in the lower court may be summarized as follows: (1) An accounting for excessive expenses paid to the Receiver's attorneys and for salaries paid by the Comptroller's office; (2) mandatory writs of injunction to compel recovery of unlawful payments made by the Receiver; and to prevent further payments for such purposes; (3) a determination that the Receiver has sufficient assets to pay all lawful claims in full; (4) that the court wind up the affairs of the receivership; (5) that the court appoint a committee of eleven to formulate and present to the court a liquidation plan (as agreed upon by appellant and the Comptroller); the committee fairly to represent the interests of depositors and stockholders of the bank and to be given all necessary information from the books and records of the Receiver; (6) that the court restrain any special group or interest among the stockholders or depositors of the bank from interfering in any manner with the work of the committee of eleven, and require any and all such groups to present any plan or ideas which they may have for termination of the receivership to the committee or to the court by a verified petition for leave to be heard in the present cause; (7) that appellees be required to answer interrogatories; (8) for general relief. In his "Amendments to Complaint" filed on July 24, 1939, appellant set out the legislative history of an act which he alleged was passed by the Michigan Legislature, limiting the payment of interest upon deposits in closed banks; that the Governor of Michigan vetoed the bill; upon information "that said veto of said House Enrolled Act No. 151 of the Legislature of Michigan at its session in the Spring of 1939, was obtained from the Governor of Michigan, Luren S. Dickinson, by actual misrepresentations and misstatements of facts and by falsely frightening him with a letter prepared by one of the Departments of the State of Michigan at the request of certain large commercial depositors in said First National Bank-Detroit." and, as additional relief, requested: "That this Court permit the addition as parties defendant herein of the said commercial depositors so procuring the said veto of said House Enrolled Act 151, and decree said depositors estopped to claim any interest on their said deposits after the closing of said bank, and that they pay personally all damages resulting by their said acts to all other parties interested in said Bank, either as savings depositors or stockholders therein." In reply to these pleadings and their comprehensive — not to say remarkable — proposals, the Comptroller moved to dismiss for reasons which may be summarized as follows: (1) The complaint as amended and supplemented asks for relief concerning matters which are exclusively within the discretion of the Comptroller; (2) no facts are alleged which would justify the court in setting aside the official acts of the Comptroller; (3) the question whether the Comptroller should approve a plan to terminate the receivership is one which calls for the exercise of discretion by the Comptroller; (4) no sufficient showing appears from the allegations of the complaint to call for an accounting by the Comptroller; (5) the depositors have not yet received payment of their claims in full; (6) no allegations of the complaint show that the Comptroller, or his predecessor, have been guilty of bad faith or personal fraud in the administration of the receivership.

In our view the correctness of the reasons assigned by the Comptroller is apparent, and the lower court properly granted the motion to dismiss. Appellant argues generally that in a number of cases various acts of the Comptroller and Receiver have been fully examined by the courts and decided on the merits. It is sufficient to say of the present case that, unlike the cases cited, the pleadings did not contain allegations sufficient to require consideration upon the merits. In this connection appellant's reliance upon Cooper v. Woodin³ provides a good example. In that case a reorganization plan had been considered by the Comptroller and rejected. The trial court heard the case and held that the Comptroller had not acted arbitrarily in rejecting the plan. This court said that upon a review of the record it was convinced that the Comptroller had acted within his statutory authority; hence, that his action was not arbitrary or capricious. No question was involved in that case as to the duty of the Comptroller to consider a proposal for reorganization which has not yet reached a stage where it can be called a plan. The record in the present case reveals that the Comptroller had expressed willingness to consider such a plan if and when one should be presented to him by a committee authorized to act. However, the record also clearly reveals that no such plan had been prepared, and, further, that no committee had been set up for the purpose. The complaint in the present case was filed on April 28, 1939; amendments were filed on July 24, 1939; a supplement to the amended complaint was filed on November 24, 1939. In this supplement appellant alleged that the Comptroller agreed on May 24, 1939, to receive and consider a plan, if and when plaintiff presented one; he attached, as an exhibit to this supplement, a copy of a letter bearing date of October 20, 1939, written by himself, to Senator Prentiss M. Brown, which shows on its face that (1) no plan had been presented; (2) no plan had been prepared; (3) no committee had been set up for the purpose of preparing a plan; (4) the various interests involved had not even agreed upon a committee. Appellant attached also to the supplement, as an exhibit, a list, also bearing date of November 24, 1939, for a "Liquidation Plan Committee (Suggested)" containing nineteen names. It was also in this supplement — filed on November 24, 1939 — that appellant requested the lower court to appoint a committee of eleven "to formulate and present to this court such a plan * * * which will fairly represent the interests of the depositors and stockholders of said First National Bank-Detroit, and give said Committee due authority so to do." It is unnecessary to do more than to set out the foregoing facts to indicate how completely this case differs from the case of Cooper v. Woodin; and how completely appellant has misconceived the law which governs the exercise by the Comptroller of the discretionary powers vested in him.⁴

The complaint also contains allegations of conclusions of law to the effect that (1) the Comptroller and the Receiver willfully breached their duty as to the receivership of the First National Bank-Detroit; (2) in that the acts and omissions of the Comptroller were the acts and omissions of his predecessor in office; (3) appellee Delano, the present Comptroller, is accountable for the acts of his predecessor. In support of these conclusions it was alleged, further, that since 1863 it has been the duty and practice of all comptrollers of the currency speedily and economically to wind up the affairs of closed banks. Upon information, allegations of the complaint set forth at length statistics on national bank receiverships and the liquidation of banks from 1933 to 1937; concluding therefrom that the different comptrollers of the currency "well knew and understood that the average National Bank Receivership and its handling and...