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felony by information had been restricted, because the United States could, under one of the amendments to the Constitution, prosecute only by indictment. In respect to this claim the court said:

"But conceding all that can be claimed in this connection, and that the state of Nebraska did enter the Union under the condition of the enabling act, and that it adopted the Constitution of the United States as its fundamental law, all that was meant by these words was that the state acknowledged, as every other state has done, the supremacy of the Federal Constitution. The 1st section of the act of 1867, admitting the state into the Union, declared: That 'it is hereby admitted into the Union upon an equal footing with the original states in all respects whatsoever.' It is impossible to suppose that, by such indefinite language as was used in the enabling act, Congress intended to differentiate Nebraska from her sister*states, even if it had the power to do so, and attempt to impose more onerous conditions upon her than upon them, or that in cases aris ing in Nebraska a different construction should be given to her Constitution from that given to the Constitutions of other states. But this court has held in many cases that, whatever be the limitations upon the power of a territorial government, they cease to have any operative force except as voluntarily adopted after such territory has become a state of the Union. Upon the admission of a state it becomes entitled to and possesses all the rights of dominion and sovereignty which belonged to the original states, and, in the language of the act of 1867, admitting the state of Nebraska, it stands 'upon an equal footing with the original states in all respects whatsoever.'

bearing here. The question there was one of a compact between the two states, assented to by Congress, concerning the boundary between them. Both the cases last referred to concerned compacts between states, authorized by the Constitution when assented to by Congress. They were therefore compacts and agreements* sanctioned by the Constitution, while the one here sought to be enforced is one having no sanction in that instrument.

Beecher v. Wetherby, 95 U. S. 517, 24 L. ed. 440, involved the validity of the grant of every sixteenth section in each township for school purposes. The grant was made by the act providing for the organization of a state government for the territory of Wisconsin, and purported to be upon condition that the proposed state should never interfere with the primary disposal of the public lands of the United States, nor subject them to taxation. The grant was held to operate as a grant taking effect so soon as the necessary surveys were made. The conditions assented to by the state were obviously such as obtained no force from the assent of the state, since they might have been exacted as an exertion of the proper power of Congress to make rules and regulations as to the disposition of the public lands. Minnesota v. Batchelder, 1 Wall. 109, 17 L. ed. 551, is another case which involved nothing more than an exertion by Congress of its power to regulate the disposition of the public lands.

The case of the Kansas Indians (Blue Jacket v. Johnson County) 5 Wall. 737, 18 L. ed. 667, involved the power of the state of Kansas to tax lands held by the individual Indians in that state under patents from the United States. The act providing for the admission of Kansas into the Union We are unable to find in any of the deci- provided that nothing contained in the Consions of this court cited by counsel for the stitution of the state should be construed plaintiff in error anything which contra- to "impair the rights of person or property venes the view we have expressed. Green now pertaining to the Indians in said terv. Biddle, 8 Wheat. 1, 5 L. ed. 547, involved ritory, so long as such rights shall remain the question as to whether a compact be- unextinguished by treaty between the tween two states, assented to by Congress, United States and such Indians." [12 Stat. by which private land titles in Kentucky, at L. 127, chap. 20.] It was held that so derived from Virginia before the separation long as the tribal organization of such Inof Kentucky from Virginia, "should remain dians was recognized as still existing, such valid and secure under the laws of the lands were not subject to taxation by the proposed state of Kentucky, and should be state. The result might be well upheld determined by the laws now existing in either as an exertion of the power of Conthis (Virginia) state." By subsequent leg-gress over Indian tribes, with whom the islation of the state of Kentucky these United States had treaty relations, or as titles were adversely affected. This court a contract by which the state had agreed held that this legislation impaired the obligation of a valid contract within that clause of the Constitution forbidding such impairment. Neither does Virginia v. West Virginia, 11 Wall. 39, 20 L. ed. 67, have any

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to forego taxation of Indian lands,-
-a con-
tract quite* within the power of a state *
to make, whether made with the United
States for the benefit of its Indian wards,
or with a private corporation for the sup-

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posed advantages resulting. Certainly the case has no bearing upon a compact by which the general legislative power of the state is to be impaired with reference to a matter pertaining purely to the internal policy of the state. See Stearns v. Minnesota, 179 U. S. 223, 45 L. ed. 162, 21 Sup. Ct. Rep. 73.

No good can result from a consideration of the other cases cited by plaintiff in error. None of them bear any more closely upon the question here involved than those referred to. If anything was needed to complete the argument against the assertion that Oklahoma has not been admitted to the Union upon an equality of power, dignity, and sovereignty with Massachusetts or Virginia, it is afforded by the express provision of the act of admission, by which it is declared that when the people of the proposed new state have complied with the terms of the act, that it shall be the duty of the President to issue his proclamation, and that "thereupon the proposed state of Oklahoma shall be deemed admitted by Congress into the Union under and by virtue of this act, on an equal footing with the original states." The proclamation has been issued and the Senators and Representatives from the state admitted to their seats in the Congress.

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ANNA C. WHITTEMORE. (No. 133.) BANKS AND BANKING (§ 248*)-NATIONAL

BANKS LIABILITY OF SHAREHOLDERS
TERMINATION.

Shareholders in a national bank which
has extended its corporate existence, con-
formably to the act of July 12, 1882 (22
Stat. at L. 162, chap. 290, U. S. Comp.
Stat. 1901, p. 3457), ceased to be such
upon the expiration of the original term
of the bank's corporate life, and therefore
could not thereafter be chargeable with
personal liability for its debts, where they
took the steps required of nonassenting
stockholders in § 5 of that act by giving
notice of a desire to withdraw, and by ap-
pointing an appraiser to obtain a valua-
tion of their shares.
Banking, Dec. Dig. § 248.*1

[Ed. Note.-For other cases, see Banks and

Has Oklahoma been admitted upon an equal footing with the original states? If she has, she, by virtue of her jurisdictional Sovereignty as such a state, may determine for her own people the proper location of the local seat of government. She is not Argued April 20, 1911. Decided May 29, equal in power to them if she cannot.

In Texas v. White, 7 Wall. 700, 725, 19 L. ed. 227, 237, Chief Justice Chase said in strong and memorable language that "the Constitution, in all of its provisions, looks to an indestructible Union, composed of indestructible states."

In Lane County v. Oregon, 7 Wall 76, L. ed. 104, he said:

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*"The people of the United States consti

[Nos. 132 and 133.]

1911.

IN ERROR to the United States Circuit

to review a judgment which reversed a judgment of the Circuit Court for the District of Massachusetts in favor of the re

ceiver of a national bank in an action to enforce the personal liability of a shareholder. Affirmed. Also

N ERROR to the Superior Court of the

tute one nation, under one government; and I State of Massachusetts for the County

this government, within the scope of the powers with which it is invested, is supreme. On the other hand, the people of each state compose a state, having its own government, and endowed with all the func tions essential to separate and independent existence. The states disunited might continue to exist. Without the states in union there could be no such political body as the United States."

To this we may add that the constitutional equality of the states is essential to the harmonious operation of the scheme upon which the Republic was organized. When that equality disappears we may re

of Suffolk to review a judgment, entered pursuant to a decision of the Supreme Court of that state, in favor of defendant in an action by the receiver of a national bank to enforce the personal liability of a shareholder. Affirmed.

See same case below, No. 132, 90 C. C. A. 634, 164 Fed. 830; No. 133, 199 Mass. 65, 85 N. E. 91.

The facts are stated in the opinion.

Mr. George L. Wilson for plaintiff in

error.

Messrs. Wilbur H. Powers, Henry H. Folsom, and Walter Powers for defendants in error.

For other cases see same topic & § NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes

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*Mr. Justice Day delivered the opinion of | ascertained by an appraisal made by a comthe court: mittee of three persons, one to be selected by such shareholder, one by the directors, and the third by the first two; and in case the value so fixed shall not be satisfactory to any such shareholder, he may appeal to the Comptroller of the Currency, who shall cause a reappraisal to be made, which shall be final and binding; and if said reappraisal shall exceed the value fixed by said committee, the bank shall pay the expenses of said reappraisal, and otherwise the appel lant shall pay said expenses; and the value ascertained and determined shall be deemed to be a debt due, and be forthwith paid, to said shareholder from said bank; and the shares so surrendered and appraised shall, after due notice, be sold at public sale, within thirty days after the final appraisal provided in this section."

These cases are practically alike. No. 132 is a writ of error to the United States circuit court of appeals of the first circuit; No. 133 is a writ of error to the superior court of Massachusetts. The suits were originally brought by Albert S. Apsey, receiver of the First National Bank of Chelsea, Massachusetts, against George E. Kimball and Anna G. Whittemore, respectively, under § 5151 of the Revised Statutes of the United States (U. S. Comp. Stat. 1901, p. 3465), making the shareholders of a national banking association individually responsible in a sum equal to the amount of their stock therein at the par value thereof, in addition to the amount invested in such shares.

In each of the cases the courts whose judgments are here for review reached the conclusion that the shareholder sued was not liable to the receiver on account of such statutory obligation. In the case from Massachusetts, while the final judgment was entered in the superior court of that state, the decision was in the supreme judicial court of Massachusetts, and is reported in 199 Mass. 65, 85 N. E. 91.

As originally organized, national banks had a corporate existence of twenty years. By the act of July 12, 1882, 22 Stat. at L. chap. 290, p. 162, U. S. Comp. Stat. 1901, p. 3457, such banks were authorized to continue their corporate existence for another twenty years. As pointed out in § 2 of the act, such extension must be authorized by consent in writing of shareholders owning not less than two thirds of the capital stock of the association. Before granting a certificate of approval of such extension, the Comptroller of the Currency is required to cause a special examination of the bank to be made, and if, after such examination, or otherwise, it appears to him that the association is in a satisfactory condition, he is required to grant his certificate of approval, or, if it appear that the condition of the association is not satisfactory, he shall withhold the same.

Section 5, which is the important one in this case, provides:

"That when any national banking association has amended its articles of associa

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Except as to the number of shares held by the shareholders sued in the two cases, and the times at which the same were acquired, the facts in both cases are essentially the same. Case No. 132 was tried upon an agreed statement of facts, as follows:

"The First National Bank of Chelsea was, prior to August 16, 1906, a banking association duly organized and existing under the provisions of the national banking act and amendments, with a capital of $300,000 divided into 3,000 shares of the par value of $100 each; that on said August 16, 1906, the said bank closed its doors and suspended business; that on August 25, 1906, the plaintiff was duly appointed by the Comptroller of the Currency, receiver of said bank; that on September 25, 1906, the Comptroller of the Currency ordered an assessment of $100 per share on each share of stock in said bank, payable by the stockholders, according to their respective holdings, on or before October 25, 1906, and ordered the plaintiff to collect and recover the same by proper proceedings; that the defendant received from said receiver a copy of said order of assessment and a separate notice and demand for payment, all of which were in the following form:

"The defendant, on November 18, 1901, became the owner of twenty (20) shares of the capital stock of said bank, and on said date received two certificates, each for ten

tion, as provided in this act, and the Comp (10) shares; on November 20, 1901, he betroller has granted his certificate of approval, any shareholder not assenting to such amendment may give notice in writing to the directors within thirty days from the date of the certificate of approval, of his desire to withdraw from said association, in which case he shall be entitled to receive from said banking association the value of the shares so held by him, to be

came the owner of fifteen (15) shares and received a certificate therefor; and on August 31, 1904, he became the owner of five (5) shares, and received a certificate therefor. Said four certificates were each and all in the following form, mutatis mutandis, and their numbers were respectively 1235, 1236, 1237, 1238.

517

519

"Massachusetts.

"The First National Bank of Chelsea. 10 Shares.

tained counsel, and the two counsel conducted a correspondence on the question of such appointment, which correspondence, however, failed to result in such appointment.

"On January 1, 1905, at the time of declaring its regular semiannual dividend, the bank declared a regular dividend of three (3) per cent to the defendant on said forty (40) shares and sent him a dividend check therefor, which the defendant promptly re

"No. 1235. "This certifies that George E. Kimball of Boston, Mass., is the proprietor of ten (10) shares of the capital stock of the First National Bank of Chelsea, transferable only on the books of the bank in person or by attorney, on the surrender of this certificate. 'No transfer of the stock of*this association shall be made without the consent of the board of directors by any stock-turned, declaring that he was not a stock. holder who shall be liable to the association either as principal debtor or otherwise.' "Chelsea, Nov. 18, 1901.

S. B. Hinckley, President. "Walter Whittlesey, Cashier. "Shares $100 each."

"The defendant held said certificates from the respective dates of their issuance, as above specified, down to and after the date of the suspension of the bank, and he had them in his possession and produced them at the trial.

"The twenty-year period of succession of said bank under the provisions of the national bank act expired on September 5, 1904, and on or before said date proper proceedings were taken under the act of July 12, 1882 (one of the amendments to the national bank act), to amend the articles of association so as to extend the period of succession for a period of twenty years from said September 5, 1904, and said articles were so amended.

"The defendant did not assent to said amendment, but, acting in pursuance of the provisions of § 5 of said act of July 12, 1882, and within the time therein named, he gave to the bank directors due notice of his desire to withdraw from the association, and afterwards appointed one William R. Dresser as one member of the appraisal committee under said § 5, and gave due notice of such appointment to the directors of the bank, and said directors appointed Sylvester B. Hinckley as a second member of said committee of appraisal, but these two never appointed the third member, and no appraisal was ever made. The said Sylvester B. Hinckley was at said time a director of said bank, its president, and a large stockholder therein.

"The defendant, after waiting some months subsequent to the appointment of said Dresser and Hinckley, during which time he made all reasonable efforts in good faith to have said third member appointed, but without result, in September, 1905, retained an attorney, who at once communicated with said Hinckley, urging him to join in the making of such appointment, and the said Hinckley, or the bank, also re

holder in the bank, and declining to accept or to use the check. Further regular divi dends were declared to him by the bank on July 1, 1905, January 1, 1906, and July 1, 1906, the latter being the last dividend declared by the bank prior to the suspen. sion.

"None of the said last mentioned dividends were sent to or received by the defendant. The defendant was also credited on the bank's ledger with said forty (40) shares. The bank never refused the defendant or withheld from him any of the rights or privileges of a stockholder, but the defendant never used or asserted any of said rights or privileges of a stockholder after September 5, 1904. The following extract from the bank's by-laws was introduced in evidence:

"'Section 15. The stock of this bank shall be assignable only on the books of this bank, subject to the restrictions and provisions of the act; and a transfer book shall be kept in which all assignments and transfer of stock of this association shall transfer of stock of this association shall be made without the consent of the board of directors by any stockholder who shall be liable to the association, either as principal debtor or otherwise; and certificates of stock shall contain upon them notice of this provision. * Transfers of stock shall not be suspended preparatory to a declaration of dividends, and except in cases of agreement to the contrary expressed in the assignments, dividends shall be paid to the stockholder in whose name the stock shall stand on the day on which the dividends are declared.

"Section 16. Certificates of stock, signed by the president and cashier, may be issued to stockholders, and the certificate shall state upon the face thereof that the stock is transferable only upon the books of the bank; and when stock is transferred, the certificates thereof shall be returned to the bank and canceled and new certificates issued.'"

The question, then, is: Did the shareholders, defendants in error, cease to be such, or were they still shareholders when the bank failed, and liable to assessment

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for the benefit of creditors? It is the contention of the plaintiff in error that they did not cease to be shareholders until, under § 5 of the act, an appraisal of the value of the stock had been made and the certificates of stock duly surrendered. Upon the other hand, the defendants in error contend that, upon complying with the steps required of them, in giving notice, appointing an appraiser, and using diligence to have an appraisal, they ceased to be shareholders, and were no longer liable to pay the assessment made.

bank also selected its appraiser, and the facts show that the shareholders urged action, employed counsel, and endeavored to bring about the appraisal. Apparently the delay was caused by the bank's representative; at least, this was the possible inference suggested by the supreme judicial court of Massachusetts. 199 Mass. 68, 85 N. E. 91.

We agree with the courts below that the defendants *ceased to be shareholders after thus complying with the statute. Section 5151 of the statute makes shareholders liable to the assessment. The statute makes specific provision for the manner in which the shareholder may sever his connection with the corporation. These necessary steps were taken, as the agreed facts show. The shareholders had a right to end their connection with the association at the termination of the period of original incorporation, or, if they so desired, they might go on with the association in its renewed

The First National Bank of Chelsea was originally incorporated, under the statute, for a period of twenty years, and while that was its span of corporate life, the defendants in error became shareholders therein, received certificates of shares, and were duly registered as shareholders. As twenty years was the life of the corporation, the shareholders had not bound themselves to remain such after the expiration of that definite period of time. As the statute | life. originally stood, the venture would necessarily terminate at the end of that time.

Section 5 provides for the manner of manifesting such determination to termi. nate their relations with the corporation at the expiration of its original life. True, other things were to be done to ascertain the amounts to be paid the retiring shareholders; that they were not done in these cases is no fault of the retiring sharehold

of the plaintiff in error, that they ceased to be shareholders only when the appraisal had been made, and the certificate of shares surrendered.

It is said that the shareholders, when the bank's representative did not act in the matter of the appraisal, might have brought suit to compel further proceedings, or to cancel their stock on the books of the company. Again we answer-that they did all that the statute required them to do.

Congress recognized that it might be proper to continue* the organization, that at least a part of the shareholders might desire to do so, and therefore the act of July 12, 1882, provided for the extension of the corporate existence of the bank. It was also recognized that a part of the share-ers. We cannot agree with the contention holders might wish to retire from the venture, and it was therefore provided that two thirds of the shareholders must acquiesce to continue the bank's existence, and must certify such desire to the Comptroller of the Currency, who must approve of the extension of the corporate existence. It is provided in § 5, above quoted, that each nonconsenting shareholder shall give notice in writing to the directors of the association, within thirty days of the date of the certificate of approval by the Comptroller, of his desire to withdraw from the association; and further, that he thereupon shall be entitled to receive from the association the value of the shares held by him, such value to be ascertained by an appraisal by a committee of three, one to be selected by the shareholder, one by the directors of the association, and the third by the first two thus selected, the value ascertained and determined is to be deemed a debt of the bank and forthwith paid, and the surrendered shares to be sold after due notice, at public sale, after thirty days from the final appraisement provided for in the section.

The agreed facts show that the shareholders here involved strictly complied with the statute in giving the required notice, and in the selection of their appraiser. The |

But, it is urged, in not getting their names off the books, whatever might be their relations with the bank, these shareholders continued to be registered shareholders, and, as such, liable to creditors. Cases are cited which hold that where one permits his name to be registered on the books of the bank as a shareholder, or where he fails to obtain a transfer of the shares to another name, although he has in fact parted with his stock, such shareholder remains liable to the creditors. (See Germania Nat. Bank v. Case, 99 U. S. 628, 25 L. ed. 448; Matteson v. Dent, 176 U. S. 521, 44 L. ed. 571, 20 Sup. Ct. Rep. 419).

But those are not cases where shareholders have done all that the law required in order to end their relation to the bank and to get their names off the books.

Where the shareholder has performed

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