Wilson v. Tesson

• Decision Date: 30 May 1859
• Citation: Wilson v. Tesson, 12 Ind. 249 (Ind. 1859)
• Parties: Wilson v. Tesson and Another
• Court: Indiana Supreme Court

12 Ind. 249

Wilson v. Tesson and Another

Supreme Court of Indiana

May 30, 1859

From the Marion Circuit Court.

The judgment is reversed with costs. Cause remanded for further proceedings in accordance with this opinion, if by amendments or proof the case can be brought within it.

L Barbour and J. D. Howland, for appellant.

Counsel for the appellant submitted the following argument:

There is really but one question presented by this record. It appears in various forms--upon the complaint, the answer, the evidence, and the motion for a new trial. All result in this Did the free banks, organized under the act of 1852, continue as subsisting corporations after the act of 1855 became the law? Or, at most, did such of these banks as did not comply with the requirements of the latter act, continue to exist as corporate bodies, after the first day of March, 1857?

We assume the following positions:

I. Our constitution permits but one system of free banks.

II. The general banking law of 1852 was repealed by the general banking law of 1855.

III. That a bank organized under the act of 1852 had no authority after the act of 1855 went into operation, to do any banking business beyond what was necessary to wind up its concerns unless such bank, at some time prior to the first day of March, 1857, had accepted and complied with the provisions of the last-named act.

IV. That immediately upon the repeal of the general banking act of 1852, the corporations existing by virtue of its provisions, which had not, within the proper time, accepted and complied with the terms upon which their continued existence was made to depend, expired without any judicial decision determining their existence.

First. We conceive it requires no argument to support the first proposition we have advanced. Section 2, art. 11, of the constitution affirms, that "No banks shall be established otherwise than under a general banking law except as provided in the fourth section of this article." Section 3 defines the limits and restrictions for such a system, and the fourth section provides for a state bank, with branches. Banks of issue must, therefore, exist by virtue of a general act. This rule of the organic law prohibits the issue of paper, having the similitude of bank notes, by voluntary associations, not organized under the general banking law. See opinion of Judge Perkins, in Anderson v. Alexander, in the Putman Circuit Court. The phrase "general" excludes the idea of more acts than one; the law ceases to be general, when it adopts and tolerates two or more systems.

Second. The second proposition assumes that the general banking act of 1852 was repealed by the general banking act of 1855. The act of 1855 (Acts of 1855, p. 23, et seq.), is entitled "An act to amend an act to authorize and regulate the business of general banking." It proceeds, in the first place, to recite all the old law, after which the following phraseology is employed by the legislature: "Be and the same is hereby amended to read as follows:" The act of 1855 then appears section by section, from § 2 to § 56, inclusive. We urge upon the consideration of the Court the force of this language. Suppose a single section of this act, or any other act, were amended by the legislature. The amending act would recite the section proposed to be amended, and proceed, after the phrase, "be and the same is hereby amended to read as follows," to set out the section as amended. What would be the effect of this amendment? We presume it would operate as a repeal of the former section. It would be evidently designed as a substitute for it, and on that ground a repeal by implication would result. But there is more in this language--"shall be amended to read as follows"--than a repeal by implication merely. If the act is to read as follows, it can only be read as follows. The sections following are the law which the legislature authorize the Courts to read, and not the preceding sections, which are recited merely to be amended, and which, if read at all, can only be read for the purposes of construction, as showing what the old law was.

We argue further, that a reading of the act of 1852, and that of 1855, will show that each was designed to cover the whole ground of a general banking system. They prescribe all the steps from the organization of the bank, for its management, its securities, circulation, deposits, reports of its condition, &c., through all the usual details, to its final winding up. Each act, at the time of its adoption was designed to be complete. When the act of 1852 was passed, the legislature, guided by what information they possessed on this intricate and difficult subject, endeavored to make the enactment perfect as far as they were able. A few years' experience brought to light various defects in the system, which, for the protection of the public, appeared to need additional guards and securities, and severer penalties. To effect the necessary modifications, two methods were open to the legislature. One was, by selecting such sections as it was necessary to modify, and amend these in conformity with the constitution; and if further sections were necessary, to adopt them. The other method was, to revise the whole act, and adopt a substitute for it. The latter course was the one pursued in this instance, for the whole subject-matter is reviewed, and the legislature, at the time of the passage of the latter act, standing where an experience of the defects of the former one had placed them, endeavored to employ this experience by making a new law, covering the whole subject-matter; in short, the act of 1855 is a revision of the former legislation upon the subject of general banking.

The internal evidence in support of this position is exceedingly strong. To glance at the most prominent feature it presents, the 48th section of the act of 1855 reads thus: "Every bank or banking association, organized under the provisions of the general banking law of this state, may, in case it shall immediately after the passage of this act pay all its circulating notes in coin upon demand, have until the first day of March, 1857, to wind up, or accept the provisions of this act."

Here is an express provision in the act of 1855, which contemplates the sweeping consequences which result from a repeal, and provides a remedy. It is as if the legislature had said in express terms--the act of 1852 is repealed by virtue of our revision; but it is not the design to destroy the corporations already existing under the act of 1852. Such of them as pay immediately after the revision all their outstanding circulation, in coin upon demand, shall have their period of grace, until the first day of March, 1857. During this interval they may close up their business; or, if they so elect, they may conform to the revision. And this temporary continuance of corporate life for the purpose of winding up, and the indefinite extension of that existence, upon conforming to the new law, are derived, not from the act of 1852, but from the act of 1855. Now the intention of the legislature is self-evident. If it were not in the mind of the law-making power to repeal the act of 1852, no amnesty to the banks already existing could have been regarded as necessary.

Again; under the act of 1852, the number of corporators is undefined; it may be one man, or a thousand. But the act of 1855, § 2, declares that the number shall not be less then eleven. The 17th section of the same act reiterates this limitation. Supposing that no repeal was intended, this determination of a number essential to the organization of a corporation, could not affect the banks already organized. On the other hand, if a repeal was intended, the restriction as to number would apply equally to all. In that case, some proviso would be necessary to preserve the corporate existence of the old banks, unless in their reorganizatiou under the act of 1855, they should, while conforming in other respects to that act, conform also in regard to the numbers. As an indication of what was the intent of the legislature, we find in section 17 of the act of 1855, a proviso, that the provisions of that section shall not apply to the banks now in existence, respecting the number of stockholders. This proviso being only necessary in case of a repeal, clearly proves that a repeal was designed.

Nor is there anything in the general law of the state at war with this view. Section 6, 1 R. S. p. 240, provides that "all corporations whose charters shall expire by limitation, forfeiture, or otherwise, shall nevertheless be continued bodies corporate, for three years after the time they would have been so dissolved, for the purpose of prosecuting and defending suits, to which they are a party, and to enable them to settle, dispose of, and convey their property, and divide the capital stock, but not to continue the business for which such corporations were established." This enactment confines the exercise of corporate powers to such purposes as may be necessary for winding up the business of the corporation, and expressly prohibits anything beyond that point.

Turning, then, to an examination of authorities, we propose to confirm these reasonings upon our second proposition.

"It is well settled that a subsequent statute, which is clearly repugnant to a prior one, necessarily repeals the former, although it does not do so in terms; and even if the subsequent statute be not repugnant in all its provisions to a prior one, yet if the later statute was clearly intended to prescribe the only rule that should govern in the case provided for, it repeals the original act." Sedgw. on Stat. and Con. Law, 124.

Can it be questioned that the act of 1855 "was clearly intended to prescribe...