Nead v. Wall

• Decision Date: 10 December 1895
• Citation: 70 F. 806
• Parties: NEAD v. WALL.
• Court: U.S. District Court — Southern District of New York

70 F. 806

NEAD v. WALL.

United States Circuit Court, S.D. New York.

December 10, 1895

Dayton Dumphy & Swift, for plaintiff.

Butler Stillman & Hubbard, for defendant.

COXE District Judge.

This is an action by a receiver of a national bank to enforce the individual liability of a stockholder. The complaint alleges:

'That on the 19th day of November, 1894, said comptroller of the currency having ascertained and determined that the assets property and credits of said association were insufficient to pay its debts and liabilities, and as provided by said acts of congress, made an assessment and requisition upon the shareholders of the said the National Bank of Middletown, of fifty dollars ($50) upon each and every share of the capital stock held and owned by them respectively at the time of its said default, and directed the plaintiff as receiver thereof to take all necessary proceedings by suit or otherwise to enforce to that extent the said individual liability of the said shareholders.'

The defendant demurs on the ground that the foregoing allegation is insufficient under the authority of Kennedy v. Gibson, 8 Wall. 498. In that case the bill alleged that the receiver had ascertained that the assets and credits of the bank were wholly insufficient to pay its debts and that it was necessary that recourse should be had to the personal liability of the stockholders. It contained no averment of any action by the comptroller touching the liability of the stockholders. The court said, page 505,

'It is for the comptroller to decide when it is necessary to institute proceedings against the stockholders to enforce their personal liability and whether the whole or a part, and if only a part, how much, shall be collected.'

The question was whether the decision, which is a condition precedent to the action, should be made by the receiver or the comptroller. Of course the court decided that this duty devolved upon the latter. In short, the question there did not turn upon the exceedingly narrow point now presented and there is little to warrant the inference that the court would have held the bill insufficient had it contained the allegation quoted from the complaint at bar. It is possible that this allegation might have been drawn with greater accuracy and made to conform more closely to the rule of Kennedy v. Gibson, but the court is inclined to think that it cannot be held bad upon demurrer. If...