Directors.

May continue to hold shares in other banks.

When may com.

the directors aforesaid may be the directors of the association until others are elected or appointed in accordance with the provisions of this act;

And any State bank which is a stockholder in any other bank, by authority of State laws, may continue to hold its stock, although either bank, or both, may be organized under and have accepted the provisions of this act.

When the Comptroller shall give to such association a mence business. certificate, under his hand and official seal, that the provisions of this act have been complied with, and that it is authorized to commence the business of banking under it, the association shall have the same powers and privileges, and shall be subject to the same duties, responsibilities, and rules, in all respects, as are prescribed in this act for other associations organized under it, and shall be held and reMinimum capi- garded as an association under this act: Provided, however, That no such association shall have a less capital than the amount prescribed for banking associations under this act.

tal.

When may be de

lic moneys.

DESIGNATED DEPOSITARIES.

SEC. 45. And be it further enacted, That all associations positaries of pub- under this act, when designated for that purpose by the Secretary of the Treasury, shall be depositaries of public money, 19 except receipts from customs, under such regulations as may be prescribed by the Secretary; and they may also be employed as financial agents of the Government; and they shall perform all such reasonable duties, as depositaries of public moneys and financial agents of the Government, as may be required of them.

Security to be given.

And the Secretary of the Treasury shall require of the associations thus designated satisfactory security, by the deposit of United States bonds and otherwise, for the safekeeping and prompt payment of the public money deposited

19. Banks designated as depositaries, under the provisions of this act, are public depositaries within the meaning of the act of August 6, 1846, (9 Stat. at Large, 59,) as amended by the act of March 3, 1857, (11 Stat. at Large, 249,) requiring every disbursing officer or agent of the United States, having any money of the Government, to deposit the same with the United States Treasurer, or with some one of the Assistant Treasurers or public depositaries. (Opinions of Attorneys General, vol. 11, page 29.)

all national cur

rency bills.

with them, and for the faithful performance of their duties as financial agents of the Government: Provided, That To receive at par every association which shall be selected and designated as receiver or depositary of the public money shall take and receive at par all of the national currency bills, by whatever association issued, which have been paid into the Government for internal revenue, or for loans or stocks.

PROCEEDINGS ON FAILURE TO REDEEM NOTES.

SEC. 46. And be it further enacted, That if any such association shall at any time fail to redeem, in the lawful money of the United States, any of its circulating notes, when payment thereof shall be lawfully demanded, during the usual hours of business, at the office of such association, or at its place of redemption aforesaid, the holder may cause the same to be protested, in one package, by a notary public, unless the president or cashier of the association whose notes are presented for payment, or the president or cashier of the association at the place at which they are redeemable, shall offer to waive demand and notice of the protest, and shall, in pursuance of such offer, make, sign, and deliver to the party making such demand an admission in writing, stating the time of the demand, the amount demanded, and the fact of the non-payment thereof; and such notary public, on making such protest, or upon receiving such admission, shall forthwith forward such admission or notice of protest to the Comptroller of the Currency, retaining a copy thereof. And after such default, on examination of the facts by the Comptroller, and notice by him to the association, it shall not be lawful for the association suffering the same to pay out any of its notes, discount any notes or bills, or otherwise prosecute the business of banking, except to receive and safely keep money belonging to it, and to deliver special deposits:

Notes, when not

mand by banks issuing them, to

redeemed on de.

be protested.

comptroller to examine into the

facts and notify

banks, &c.

protest and fees therefor.

Provided, That if satisfactory proof be produced to such Restriction on notary public that the payment of any such notes is restrained by order of any court of competent jurisdiction, such notary public shall not protest the same; and when the holder of such notes shall cause more than one note or

Comptroller's

notice of protest of notes.

package to be protested on the same day, he shall not receive pay for more than one protest.

SEC. 47. And be it further enacted, That on receiving noduty on receiving tice that any such association has failed to redeem any of its circulating notes, as specified in the next preceding section, the Comptroller of the Currency, with the concurrence of the Secretary of the Treasury, may appoint a special agent (of whose appointment immediate notice shall be given to such association,) who shall immediately proceed to ascertain whether such association has refused to pay its circulating notes in the lawful money of the United States, when demanded as aforesaid, and report to the Comptroller the facts so ascertained; and if, from such protest or the report so made, the Comptroller shall be satisfied that such association has refused to pay its circulating notes as aforesaid and is in default, he shall, within thirty days after he shall have received notice of such failure, declare the United States bonds and securities pledged by such association forfeited to the United States, and the same shall thereupon be forfeited accordingly.

Forfeiture of bonds.

If bonds are forfeited, notes to be called in and paid

And thereupon the Comptroller shall immediately give notice in such manner as the Secretary of the Treasury at U.S. Treasury. shall, by general rules or otherwise, direct, to the holders of the circulating notes of such association to present them for payment at the Treasury of the United States, and the same shall be paid as presented in lawful money of the United States; whereupon said Comptroller may, in his discretion, cancel an amount of bonds pledged by such association equal at current market rates, not exceeding par, to the notes paid.

Disposal of notes redeemed.

In case of deficiency

And it shall be lawful for the Secretary of the Treasury, from time to time, to make such regulations respecting the disposition to be made of such circulating notes after presentation thereof for payment as aforesaid, and respecting the perpetuation of the evidence of the payment thereof, as may seem to him proper; but all such notes, on being paid, shall be canceled.

And for any deficiency in the proceeds of the bonds pledged by such association, when disposed of as herein

to have prior lien on assets for

amount expend

after specified, to reimburse to the United States the amount -United States so expended in paying the circulating notes of such association, the United States shall have a first and paramount lien upon all the assets of such association; and such deficiency shall be made good out of such assets in preference to any and all other claims whatsoever, except the necessary costs and expenses of administering the same.

SEC. 48. And be it further enacted, That whenever the Comptroller shall become satisfied, as in the last preceding section specified, that any association has refused to pay its circulating notes as therein mentioned, he may, instead of canceling the United States bonds pledged by such association, as provided in the next preceding section, cause so much of them as may be necessary to redeem the outstanding circulating notes of such association to be sold at public auction in the city of New York, after giving thirty days' notice of such sale to such association.

ed in redemption

of notes.
(See note 24, page

135.)

Bonds to be sold demption of notes.

at auction for re

May be sold at private sale if thinks best.

Comptroller

Sales not com

plete until trans

fer made.

SEC. 49. And be it further enacted, That the Comptroller of the Currency may, if he shall be of opinion that the interests of the United States will be best promoted thereby, sell at private sale any of the bonds pledged by such association, and receive therefor either money or the circulating notes of such failing association: Provided, That no such bonds shall be sold by private sale for less than par, nor less than the market value thereof at the time of sale: And provided further, That no sales of any such bonds, either public or private, shall be complete until the transfer thereof shall have been made with the formalities prescribed in this act. SEC. 50. And be it further enacted, That on becoming Receiver, when satisfied, as specified in this act, that any association has to be appointed, refused to pay its circulating notes as therein mentioned, ties. and is in default, the Comptroller of the Currency may forthwith appoint a receiver, and require of him such bond and security as he shall deem proper, who, under the direction of the Comptroller, shall take possession of the books, records, and assets 20 of every description of such associa

20. As to the power of a receiver over the residue of bonds deposited to secure circulation, after the payment of all notes, see the opinions of

his bond and du

tion, collect all debts, dues, and claims 21 belonging to such association, and, upon the order of a court of record of competent jurisdiction, 22 may sell or compound all bad or doubt. ful debts, and, on a like order, sell all the real and personal property of such association, on such terms as the court shall direct; and may, if necessary to pay the debts of such association, enforce the individual liability of the stockholders provided for by the twelfth section of this act; 23 and such receiver shall pay over all money so made to the Treasurer of the United States, subject to the order of the

a divided court in Van Antwerp v. Hulburd et al., (8 Blatchford C. C. R., 282.)

The right to appeal from a judgment in a suit against a State bank converted into a national bank which fails, passes to the receiver. (Claflin v. The Farmers and Citizens' Bank of Long Island, 54 Barbour, 228.)

21. The word "debts" in this section includes all legal liabilities. The assets in the hands of the receiver are to be divided and appropriated to the payment of all legal liabilities, whether such liabilities are debts, technically so called, or result from the non-feasance or mal-feasance of the association in respect to its binding obligations and duties. (Turner v. First National Bank of Keokuk, 26 Iowa, 562.)

A receiver of a national bank is an officer of the United States, and may bring suits in the district courts of the United States, under the provisions of the act of March 3, 1815, (sec. 4,) to collect claims due to the bank. His appointment by the Comptroller of the Currency, with the concurrence of the Secretary of the Treasury, is equivalent to an appointment by the Secretary, who is the head of a Department, and comes within the provisions of the Constitution, art. II, sec. 2, sub. 2. (Platt, Receiver, v. Beach, 2 Benedict's District Court R., 303.)

After a bank had stopped payment, and before a receiver was appointed, a debtor to the bank purchased and took an assignment of the claim of a depositor, for the purpose of having it set off against his debt. A receiver was afterwards appointed, and the set-off was disallowed and the assignment held to be void, as an attempt to give a preference probibited by this act. (Venango National Bank v. Taylor, 56 Penn., 14.)

22. A district court of the United States is a court of record of competent jurisdiction, within the meaning of this section, to make an order authorizing a receiver to compromise doubtful debts. (Petition of Platt, Receiver, 1 Benedict's District Court R., 534.)

23. Action on the part of the Comptroller of the Currency is indispensable, whenever the personal liability of the stockholders is sought to be enforced, and must precede the institution of suit by the receiver, who is the statutory assignee, and the proper party to institute all suits. Creditors of the bank are not proper parties to such suits. (Kennedy v. Gibson et al., 8 Wallace, 498.)