State ex rel. Davis v. Farmers' State Bank of Bayard

• Decision Date: 16 April 1925
• Docket Number: No. 23300.,23300.
• Citation: 113 Neb. 348,203 N.W. 572
• Parties: STATE EX REL. DAVIS, ATTY. GEN., v. FARMERS' STATE BANK OF BAYARD. UNITED STATES NAT. BANK OF OMAHA v. FRICKE.
• Court: Nebraska Supreme Court

113 Neb. 348

203 N.W. 572

STATE EX REL. DAVIS, ATTY. GEN.,

v.FARMERS' STATE BANK OF BAYARD.

UNITED STATES NAT. BANK OF OMAHA

v.FRICKE.

No. 23300.

Supreme Court of Nebraska.

April 16, 1925.

Syllabus by the Court.

The bank guaranty law in denying to a stockholder the right of priority, if he borrows money for the bank instead of the bank borrowing it for itself, or bases his claim to priority on an evidence of indebtedness representing money obtained by him for the purpose of effecting a loan of funds to the bank, does not prevent a stockholder from individually depositing his own money in the bank in good faith for his own benefit, nor from participating individually in the bank guaranty fund, where he does nothing to forfeit that right.

Appeal from District Court, Morrill County; Hobart, Judge.

Proceeding by the State, on the relation of Clarence A. Davis, Attorney General, against the Farmers' State Bank of Bayard, in which Lawrence A. Fricke was appointed as receiver of defendant, and in which the United States National Bank of Omaha, as claimant, filed petition for allowance of claims on certificates of deposit. From a judgment allowing certificates of deposit as general claims, and denying recourse to bank guaranty fund, claimant appeals. Affirmed in part, and reversed in part.Mothersead & York, of Scottsbluff, and Morsman, Maxwell & Haggart, of Omaha, for appellant.

Williams, Hurd & Neighbors, of Bridgeport, for appellee Farmers' State Bank of Bayard.

C. M. Skiles, of Lincoln, for appellee Fricke.

Heard before MORRISSEY, C. J., ROSE, GOOD, and EVANS, JJ., and REDICK and SHEPHERD, District Judges.

ROSE, J.

This is a controversy between the receiver of the Farmers' State Bank of Bayard, an insolvent corporation, and the United States National Bank of Omaha, claimant, over the payment of four certificates of deposit out of the bank guaranty fund. In a proceeding by the state for the appointment of a receiver, claimant filed a petition for the allowance of claims based on certificates of deposit issued by insolvent as follows: To A. A. Ericson, July 13, 1921, due January 13, 1922, $2,000; to A. A. Ericson October 15, 1921, due April 15, 1922, $6,000; to J. A. Cavett September 22, 1921, due November 20, 1921, $5,000; to T. E. Williams September 22, 1921, due November 20, 1921, $5,000; each bearing interest at the rate of 5 per cent. per annum. Claimant pleaded that these certificates of deposit were assigned to it in due course of business, that they are unpaid, and that they are protected by the bank guaranty fund. The receiver in an answer to the petition of claimant resisted the allowance of the claims as charges against the bank guaranty fund on the grounds that the certificates of deposit evidenced loans to the bank instead of deposits therein, that the payees were stockholders whose claims were not within the protection of the bank guaranty fund, and that claimant acquired by assignment no greater right. The statute on which the receiver relies contains this provision:

“No claim to priority shall be allowed which is based upon any evidence of indebtedness in the hands of or originally issued to any stockholder, officer or employee of such bank, which represents money obtained by such stockholder, officer or employee, from himself or some other person, firm, corporation or bank in lieu of or for the purpose of effecting a loan of funds to such failed bank.” Comp. St. 1922, § 8033.

Upon a trial of the issues the district court allowed the certificates of deposit as general claims aggregating $19,093.98, including interest, against the assets of insolvent but denied recourse to the bank guaranty fund. Claimant has appealed.

Did the certificates of deposit issued by insolvent...