Vincent v. Reeves

• Decision Date: 20 April 1934
• Docket Number: 1850
• Citation: 47 Wyo. 117,31 P.2d 680
• Parties: VINCENT v. REEVES, JR., STATE EXAMINER
• Court: Wyoming Supreme Court

31 P.2d 680

47 Wyo. 117

VINCENT v. REEVES, JR., STATE EXAMINER

No. 1850

Supreme Court of Wyoming

April 20, 1934

APPEAL from the District Court, Fremont County, EDGAR H. FOURT Judge.

Action by Joe Vincent against William Reeves, Jr., State Examiner to cancel a statement filed by defendant with the County Clerk, creating a lien on real estate to secure the collection of defendant's liability upon shares of stock held by him in an insolvent bank. There was a judgment for plaintiff and defendant appeals.

Judgment reversed and Remanded.

The cause was submitted for the defendant and appellant on the brief of F. B. Sheldon, Jr., of Riverton.

The law clearly establishes a double liability on shares of stock in state banks, payable upon insolvency only, and is collectible by the State Examiner. The statement filed by the State Examiner in the present case is in accordance with the statute, Sec. 10-508, R. S. 1931. This liability is made an asset of an insolvent bank. Stewart v. Allison, 36 Wyo. 202; Stewart v. Collins, 36 Wyo. 211. The above cases were decided under the provisions of Section 5186, C S. 1920, a section that was repealed by the Banking Act of 1925 and re-enacted verbatim with the additional provisions found in our present law after the second sentence. Laws 1925, Chapter 157, Section 87 as amended by Laws 1927, Chapter 100, Section 3; Pollard v. Bailey, 20 Wallace 520; Root v. Sinnock, (Ill.) 11 N.E. 339; Bernheimer v. Converse, 206 U.S. 516; Fletcher Cyc. Corps., Vol. 6, page 7186. If the judgment below is correct, why did the legislature provide for a hundred per cent assessment upon insolvency? Houghton Bros. v. Yocum, 40 Wyo. 57. The mere change of phraseology or the omission or addition of words will not change the operation or construction of former statutes. If the court should consider that any ambiguity exists as to the intent of Section 10-508, R. S. 1931, it may resort to the history of its passage through the legislature. Ross v. State, 30 Wyo. 458; McLaughlin v. O'Neill, 7 Wyo. 187. Liquidation proceedings may be commenced by one creditor of an insolvent bank. Stewart v. Collins, supra; Stewart v. Allison, supra. The assessment payment made by plaintiff, Sections 10-505 and 10-506, R. S. 1931, were made voluntarily to keep a bank running, and did not relieve plaintiff from his liability upon insolvency. Page v. Jones (Okla.) C. C. A., 7 F.2d 541, certiorari denied Jones v. Page, 269 U.S. 587; Andrews v. Blair (Ohio) 178 N.E. 581, 83 A. L. R. 141. The statement was rightfully and lawfully filed by the State Examiner, and the judgment of the District Court should be reversed.

For the plaintiff and respondent the cause was submitted on the brief of George H. Paul, of Riverton, and G. J. Christie, of Lander.

Plaintiff, Joe Vincent, has been the owner of twenty shares of the capital stock of the Riverton State Bank of Riverton since 1925, for which he paid $ 100.00 per share. In addition to this, he paid on November, 1926, a 100 per cent assessment. The original bank stock liability act was passed in 1888, Section 5186, C. S., and remained in effect until 1925, when it was amended, but the liability of stockholders remained the same, and had been interpreted by the state Supreme Court and elsewhere. Stewart v. Allison, 36 Wyo. 202; Stewart v. Collins, 36 Wyo. 210; 25 R. C. L. 1050. By the repeal and re-enactment of the statute, or the portion thereof material to this controversy, the formal words, "in addition to the amount invested in such stock," were omitted. The authority of appellant as State Examiner, as set forth by the Laws of 1925, Chapter 157, Section 84, was preserved in the Act of 1927, but the intent of the statute is plain. Laws 1927, Chapter 100, Section 87. The cause was submitted upon an agreed statement of facts. In addition to the statutes and cases cited above, we direct attention to 25 R. C. L. 1050. It is our contention that, the words "in addition to the amount invested in such stock," having been omitted from the present law, and plaintiff having paid a 100 per cent assessment on his said stock in said bank in November, 1926, the judgment of the trial court should be affirmed.

KIMBALL, Chief Justice. BLUME and RINER, JJ., concur.

OPINION

KIMBALL, Chief Justice.

The plaintiff and respondent at all times mentioned has been the owner of 20 shares of the capital stock of the Riverton State Bank which on August 19, 1932, became insolvent and passed into the hands of the State Examiner whose successor in office is the defendant and appellant.

In June, 1926, the bank was examined by the State Examiner to whom it appeared that the capital stock was impaired. Acting under § 10-505, R. S. 1931, the Examiner notified the bank to make good the impairment. Pursuant to the notice and for the purpose of complying therewith, as provided by § 10-506, a 100 per cent assessment on the par value of outstanding stock was voted at a stockholders meeting held in October, 1926. In November, 1926, plaintiff paid the bank the full amount of the assessment on the stock owned by him. The bank then continued to operate and do a banking business until August, 1932, when it was taken over by the Examiner, as above stated.

Section 10-508, R. S. 1931, provides, among other things, that when the State Examiner has taken possession of the assets of an insolvent banking corporation and is of the opinion that it will become necessary in the course of liquidation of the bank to resort to the liability of shareholders as therein provided, he shall file with the county clerk a written statement which creates a lien on real estate in the county owned by the shareholder mentioned in the statement. This action is brought to cancel such a statement affecting real property owned by plaintiff. The judgment was for plaintiff and defendant appeals.

The argument in support of the judgment is that the statute enacted in 1888 (Sess. Laws, ch. 88, § 47), and re-enacted without change by the first sentence of § 87, ch. 157, Session Laws of 1925, providing for the shareholder's liability which the defendant seeks to enforce against the plaintiff in this case, was materially changed by an amendment of 1927 (Sess. Laws, ch. 100, § 3) now § 10-508, supra. Under the statute as amended, it is claimed that plaintiff as a shareholder assumed no liability beyond that which he has already discharged by paying the bank the purchase price of his stock and the amount of the assessment of 1926.

The statute of 1888, carried forward as section 5186 of C. S. 1920, read as follows:

"The shareholders of each and every banking association, savings bank and loan and trust company or association, organized under the provisions of this chapter shall be held individually responsible, equally and ratably and not one for another, for all contracts, debts and engagements of such company or association to the extent of the amount of their stock therein at the par value thereof, in addition to the amount invested in such stock."

This section, with the rest of the chapter in which it was contained, was repealed by the new banking act of 1925, but section 5186 without change was re-enacted by the first sentence of section 87 of the new act (ch. 157, Sess. Laws, 1925). The re-enacted section, after setting forth the old law above quoted, defines the term shareholder; contains provisions intended to prevent a shareholder from escaping liability by transferring his stock within sixty days before insolvency or with knowledge of impending insolvency; provides for the filing of a notice of lien like that in the case at bar when the Examiner shall be of opinion that it will be necessary to resort to the liability "in order to make good the contracts, debts and engagements" of the bank; makes it the duty of the Examiner to release the lien when the shareholder deposits money equal to the amount of his stock at the par value of his shares "as security for his liability hereunder," and to return to the shareholder any excess of such deposit if his ultimate liability shall prove to be less than the amount deposited.

By the amendment of 1927 (§ 10-508, R. S.) the following was substituted for section 5186, C. S. 1920, as re-enacted by the first sentence of section 87 of the law of 1925:

"The shareholders of each and every banking association, savings bank and loan and trust company or association, organized under the provisions of this Act shall be held individually responsible, equally and ratably and not one for another, to the extent of the amount of their stock therein at the par value thereof, and such liability shall be deemed an asset of the insolvent bank, and upon insolvency shall become due and payable. The sole right of action for the collection of such liability shall be vested in the State Examiner."

The rest of the section is substantially the same as in the law of 1925.

The phrase "in addition to the amount invested in such stock," contained in the old law, is omitted by the amendment. Plaintiff's contention, sustained by the judgment is that the omission of this phrase from the amended law shows the legislative intention that the liability of the shareholder shall not exceed the amount invested in his stock. He relies on the principle that "a change in phraseology of an amendatory statute raises a presumption that a departure from the old law was intended." 25 R. C. L. 1051.

The presumption relied on is an aid in interpretation, but not necessarily controlling. It is resorted to for the purpose of discovering the intention of the legislature. It cannot prevent the consideration of other matters that may be of more importance in determining whether or not a change in the meaning of the law was intended. Changes in phraseology may...