State Ex Rel. C. I. Dodd S. v. Hill

• Decision Date: 16 September 1919
• Court: West Virginia Supreme Court
• Parties: State ex rel. C. I. Dodd et als. v. J. S. Hill, BankingCommissioner.

84 W.Va. 468

State ex rel. C. I. Dodd et als.

v.J. S. Hill, Banking Commissioner.

Supreme Court of Appeals of West Virginia.

Submitted September 10, 1919.

Decided September 16, 1919.

1. Banks and Banking Charter Discretion of Commissioner of Banking.

That part of section 78, ch. 54, Code, as amended in 1919, which provides that "hereafter no charter shall be issued to any bank to do business in this state until the application therefor has been approved in writing by the commissioner of banking," vests in such commissioner discretionary power to approve or reject such application. (p. 470).

2. Same Application for Charter Discretion of Commissioner of Banking.

The refusal of the commissioner of banking to approve an application for a charter in a proper exercise of such discretionary power is not subject to judicial review on the ground that a different decision should have been made, unless it clearly appears that he has wilfully and arbitrarily disregarded his duty, or that his decision was due to caprice, passion, partiality or corruption, (p. 470).

Mandamus by the State, on the relation of C. I. Dodd and others, against J. S. Hill, Banking Commissioner, etc.

Writ denied.

Henry S. Cato and Linn & Byrne, for relators, McClintic, Mathews & Campbell, for respondent.

Lynch, Judge:

Guided by his own construction of section 78, ch. 54, Code, as amended by chapter 21, Acts 1913, prescribing his authority as Commissioner of Banking, J. S. Hill declined to issue a certificate of approval of the application of C. I. Dodd and others for authority to establish a state bank at Elk View in Elk district, Kanawha County, to be called and known as Elk View Banking Company. To compel the issuance of such certificate, petitioners applied to this court for ¦and obtained an alternative writ requiring him either to comply with the writ forthwith or appear and show cause for not doing so. To the petition respondent appeared and demurred, moved to quash the writ, and filed his return, to which petitioners demurred.

Speaking as of the date at which the amendment of 1913 became effective, the legislature declared that "hereafter no charter shall be issued to any bank to do business in this state until the application therefor has been approved in writing by the commissioner of banking.'' It is by virtue of this power that respondent seeks to justify his action in withholding the certificate without which no new state banking institution lawfully may open its doors for the transaction of business in this state.

As to the power of the legislature to enact a provision of this character there is no question raised, but the existence of the power is conceded, and nothing need be said upon that subject except to remark that while judicial decisions are not entirely in accord, the greater number uphold such or similar enactments as within the scope of the regulatory authority of the Congress and of the legislatures of the several states.

Respondent's return, petitioners say, is not sufficient to justify the withholding of the commissioner's approval of their preliminary application for the privilege of engaging in the banking business, and that upon such application the only duty he then was required to perform was to determine the formal sufficiency of the papers presented for examination and approval. The language of the statute does not so limit or circumscribe the powers it purports to confer upon the office thus created. Besides, there was no need to regrant such a right to test the legal sufficiency of such preliminary documents, as that right then belonged and still belongs to the office of the Secretary of State, and it is there that such a test is made.

Respondent in the return defends his action in part by showing like action by former occupants of the office in similar circumstances, and a virtual ratification or indorsement of the construction given by him and them of the provisions of section 78 in this, that the legislature of 1919, presumably knowing and consenting to such construction, amended and re-enacted the section in other particulars but left intact the provisions so construed.

But granting the scope of the power to be as broad as the respondent says it is, petitioners claim that his action, nevertheless, was wholly unjustifiable and arbitrary, and that none of the reasons relied on to justify the rejection of their application were sufficient for that purpose. Before condemning as arbitrary and unreasonable the action of an officer charged with the performance of an important public duty, a court should carefully scrutinize the grounds assigned for so doing. Looking to these we find the only charge to he that the banking commissioner acted adversely upon the application on the day it was presented to...