The State ex Informatione Crow v. Lincoln Trust Co.

• Decision Date: 14 June 1898
• Parties: The State ex informatione Crow, Attorney-General, v. Lincoln Trust Company, Etc
• Court: Missouri Supreme Court

46 S.W. 593

144 Mo. 562

The State ex informatione Crow, Attorney-General, v. Lincoln Trust Company, Etc

Supreme Court of Missouri

June 14, 1898

Writ of ouster granted.

G. A Finkelnburg for respondent Union Trust Company; Boyle, Priest & Lehmann and J. E. McKeighan for respondent Mississippi Valley Trust Company; F. N. Judson, Fisse & Kortjohn and Lubke & Muench for respondent Lincoln Trust Company; and Stewart, Cunningham & Eliot for respondent St. Louis Trust Company.

(1) The fundamental question is: Whether trust companies may receive money in mutuum. By the letter of the statutes they are empowered to receive money in exchange for their credit thereby establishing the relation of debtor and creditor. The right to engage in this relation being established it follows necessarily they may make any contract pertaining to that relation and adopt any mechanism in carrying out the terms of their implied or express contract they may determine upon which does not contravene some positive law or rule of public policy. Section 2839, R. S. 1889, as amended by the act of April 18, 1891, p. 99; People v. Binghamton Trust Co., 139 N.Y. 185; Bank v. New York, 121 U.S 138. First. Where a grant of power is given, all the means necessary to effectuate that power pass as incidents of the grant. State v. Walbridge, 119 Mo. 383; State v Laclede Gas Co., 102 Mo. 485; 1 Morawetz on Corp., sec. 320. Second. When trust companies are empowered to receive money from the public, to allow interest thereon, and to invest such moneys, then these corporations are also empowered to adopt the ordinary methods and forms which are adapted to the carrying on of such a business. Henning v. Ins. Co., 47 Mo. 425; Morawetz, secs. 336, 326; Railroad v. Union Steamboat Co., 107 U.S. 98; Wendall v. State, 62 Wis. 304. (2) The foregoing construction of the first clause of the act is confirmed by the language of the fifth clause, "and generally to have and exercise such powers as are usually had and exercised by trust companies." This language is to be construed, notwithstanding its collocation in the fifth clause of the section, as applicable to all the powers granted. Any other construction is unmeaning, and this, as every other statute, must be so construed, as, if possible, to give effect to all its clauses. Black on Interp. of Laws, p. 460; Sutherland on Stat. Cons., sec. 268; 23 Am. and Eng. Ency. of Law, 369. Punctuation is not a part of the statute. Doe v. Martin, 4 Term Rep. 65; Hammock v. Land & Trust Co., 105 U.S. 84; 23 Am. and Eng. Ency. of Law, 334; U. S. v. Lacher, 134 U.S. 624. So the collocation of clauses will be disregarded when necessary to give effect to the true legislative intent. Waters v. Campbell, 4 Sawyer, 121; State ex rel. v. Turnpike Co., 16 Ohio St. 319; Matthews v. Comm., 18 Grat. 989. This construction is confirmed by a comparison of the Missouri statute with the charter of the Central Trust Company of New York, from which the Missouri statute was obviously taken. Trust companies were well known in the commercial world at the time of the enactment of the Missouri statute, and the "powers usually had and exercised" included that of receiving deposits with the relation of debtor and creditor created thereby. Bank v. New York, 121 U.S. 138; People v. Binghamton Trust Co., 139 N.Y. 185; In re Solicitor's Trust Co., 3 Pa. S.Ct. 244. (3) The various acts of the legislature, passed since the adoption of the first trust company law of 1885, have not only construed that law so as to include the right to take deposits payable at sight or on demand, buthese subsequent acts in themselves amount to a grant of the right to receive such deposits irrespective of the terms of the original law on the subject. People v. Manhattan Bank, 9 Wend. 351; Society v. Pawlett, 4 Pet. 480; Bow v. Allentown, 34 N.H. 351; People v. Perrin, 56 Cal. 345; State v. Talbot, 123 Mo. 69; Sutherland on Stat. Cons., sec. 311. The recognition by legislative action of the right to exercise certain powers, although not originally granted, operates as a waiver by the State of its right to object to the exercise of such powers. Spelling on Ext. Relief (Title Quo Warranto), sec. 1862; Morawetz on Corp., sec. 20; Cook on Stockholders, sec. 636; Bank v. State, 6 Smed. & M. 622; Mead v. Railroad, 45 Conn. 218; Poor's School v. Canal Co., 12 Ohio 205; Koch v. Railroad, 75 Md. 22; McAuley v. Railroad, 83 Ill. 352; Small v. Chicago, 133 Ill. 413; Railroad v. Railroad, 22 Mo.App. 69; Bashaw v. Dressel, 34 Md. 503; Coal Co. v. Canal Co., 7 Blatchf. 391; People v. Ottawa Co., 115 Ill. 281; Railroad v. Oregonian Navigation Co., 23 F. 232. (4) The State of Missouri, having through its legislature repeatedly recognized and affirmed the right of trust companies to receive deposits subject to check at sight or on demand, is now estopped from proceeding against these respondents for exercising that right. U. S. v. Road Co., 54 F. 811; Comm. v. Pejepscut Props., 10 Mass. 155; Comm. v. Andre, 3 Pick. 224; People v. Bank, 9 Wend. 354; People v. Perrin, 56 Cal. 345; State v. Westport, 116 Mo. 582; Bishop on Cont., sec. 310.

Edward C. Crow, Attorney-General, Sam B. Jeffries, Assistant Attorney-General, and W. W. Graves for informant.

(1) Respondents start with the proposition conceded that a trust company may receive money in the same manner that a bank may so receive it. And then arguing that because it may receive it as a bank, therefore, a trust company has implied authority to repay it in the same manner that a bank has. But the proposition from which they argue being erroneous, and being disputed, of course we can not concede their argument as correct. Our contention is that a trust company does not receive money in the same manner, and in the same relation that a bank receives it. A trust company receives the money which the depositor places with it as a trust company and not otherwise. This is the only power that is given to such company to receive money. It is not incorporated as a bank nor authorized as a bank to receive money, but as a trust company. And having received said money as a trust company, the only implied authority that said trust company would have to repay it would be to repay it as a trust company and not as a bank. When a deposit is made in a bank no understanding, no contract, no arrangement, nothing is necessary to authorize the depositor to draw his check on said bank and said bank is by operation of law alone compelled to honor said check. Without this characteristic no institution is a bank; with it, any institution is doing a banking business. 1 Morse on Banks and Banking [3 Ed.], secs. 363, 367 and 376; Espy v. Bank, 18 Wall. 620; Harmanson v. Bain, 1 Hughes, 188. A check is always drawn on a bank or banker. Bank v. Bank, 10 Wall. 604; 1 Morse on Banks and Banking [3 Ed.], sec. 378; 2 Daniels on Neg. Inst. [4 Ed.], secs. 1566 and 1568; Hawley v. Jette, 10 Ore. 31; Coal Co. v. Bowman, 69 Iowa 152; Goodwin v. Bank, 48 Conn. 550. (2) What is that, then, in this day without which any institution is not a bank, and with which it is a bank? It is the power to receive deposits subject to check at sight and to buy and sell foreign and inland bills of exchange. Bank v. Earl, 13 Pet. 594. (3) It being true that the right to receive deposits subject to check and draft at sight and buy and sell foreign and inland bills of exchange is a franchise to be obtained only from the sovereign state, these respondents must show some grant of authority to them. Bank v. Young, 37 Mo. 398. Corporate powers are not created by implication. Railroad v. Canal Comm., 21 Pa. St. 22. No act for creating corporations can ever be extended by construction to cases not reasonably covered by its terms. Corporate powers can not be created by implication, or extended by construction. Endlich on Stat. Inter., sec. 6; Railroad v. Clark, 53 Mo. 214. Ambiguity or doubt as to corporate power is to be resolved against corporation and in favor of the public. Carroll v. Campbell, 108 Mo. 559; Fanning v. Gregoire, 16 How. 534; St. Louis v. Russell, 9 Mo. 507; Blair v. Ins. Co., 10 Mo. 559; Ruggles v. Collier, 43 Mo. 353; State ex rel. v. Murphy, 130 Mo. 10. Reasonable doubt in construction is to be resolved adverse to corporation. Fertilizing Co. v. Hyde Park, 97 U.S. 659; Newton v. Comm., 100 U.S. 548. If the charter is silent about a corporate power it does not exist. Black on Inter. of Laws, pp. 319, 320; Collidge v. Williams, 4 Mass. 140. (4) The evidence clearly shows that each of the respondents has opened and now keeps a place of business in St. Louis furnished as an ordinary banking-house for receiving deposits payable upon demand. That they have received deposits to be paid upon demand and paid them upon demand. This constitutes them bankers, and their business a banking business. Curtes v. Leavitt, 15 N.Y. 56. The relation created between depositor and bank is the relation of debtor and creditor and not the relation of principal and agent, or the relation of trustee and cestui que trust. 3 Am and Eng. Ency. of Law [2 Ed.], sec. 7, p. 826. (5) It would be absurd to say that the legislature intended by the terms of the statute to convey the idea that said trust company is to receive money upon deposit as a bank. The words "special deposits" as used therein are to be taken in the ordinary and usual signification of the words. Morse on Banks and Banking [3 Ed.], sec. 183, defines a special deposit as follows: "A special deposit is where the whole contract is that the thing deposited shall be safely kept, and that identical thing returned to the depositor. And this contract may arise by express agreement, or by the nature of the deposit, as if it were gold, plate, or money, or money and securities locked in a box,...