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ings, not only on the people of this State, but on the whole Country; that it will form an era in our legislation and business, which will be remembered and felt for good, as long as the institutions of the Country shall stand. [It has already destroyed banking monopoly, and purified our legislative halls—of themselves a sufficient eulogy—but it furnishes the people a safe and convenient currency; opens the business of banking to fair competition ; encourages industry, commerce, and the mechanic arts, and holds them in steady courses. I must not, however, dwell on these topics, pleasing and full of hope and cheering anticipation as they are.
The project of a General Banking Law was first brought fully to the attention of the Legislature in 1837. During the session of that year, numerous petitions were presented from different parts of the State, praying for such a law.
Mr. Cutting,” a member of the Assembly that year from the city of New York, has the honor of introducing the first bill for legislative action on this important subject. On the 11th February, 1837, he gave notice of his intention, on some future day, to ask leave to bring in a bill, “to amend the act relating to limited partnerships;” and, accordingly, on the 23d of that month, he introduced a bill, on leave, entitled, “An Act in relation to limited partnerships, and to authorize assignable interests therein.” I have not seen this bill, as introduced by Mr. Cutting, but there is no doubt it was a bill, in substance, to authorize the business of banking. On the same day, and after Mr. Cutting had introduced his bill, and after it had been read the first and second time, the Assembly directed their “committee on the incorporation and alteration of the charters of banking and insurance companies, as soon as practicable, to report, for the action of the House, a general bank law.” On the 3d of March following, Mr. Robinson, from that committee, reported a bill, entitled, “An Act to authorize associations for the purposes of banking.” These two bills were referred together to a committee of the whole, on the 14th of that month. They were often before that committee, until the 22d of that month, when the committee, not having acted definitively on the bill introduced by Mr. Robinson, reported on that introduced by Mr. Cutting, that they had amended and agreed to it. The House accepted this report by a vote of sixty-five to forty-one, and ordered the bill engrossed. It came up for a third reading, and was read the third time, the next day, when a motion was made to lay it on the table, which carried by a vote of sixty-six to forty-three. On the 6th of April following, the committee of the whole again took up the bill introduced by Mr. Robinson, and after having had it before them on several different days, reported to the House, on the 11th of that month, that they had amended and agreed to it. The report was laid on the table. On the 13th, this bill was referred to the Attorney-General, “with instructions to report his opinion as to the constitutionality of the provisions thereof; and also, whether, in his opinion, the passage of the said bill requires the assent of two-thirds, of the members elected to each branch of the Legislature, to pass the same; and if, in his opinion, any of the provisions of the bill are unconstitutional, that he specify in what respect particularly.” On the following day, the bill introduced by Mr. Cutting was also referred to the Attorney-General, with substantially the same instructions. He reported upon both bills four days afterwards, viz., on the 18th of April. His opinion on the bill “to authorize associations for the purpose of banking,” is more full than on the other, as in that, he states at large his reasons for his opinion on both. That opinion was, that both bills were unconstitutional, and that each required a two-thirds vote to pass it. I shall hereafter examine fully the principles and reasons of his opinion on these bills; but at present, it is sufficient to state the facts, and his conclusions upon them. *
* Francis B. Cutting, Esq., a member of the Bar in the city of New York. Although Mr. C. is yet classed with the junior members of his profession, he is rapidly advancing in usefulness and reputation, and must soon enjoy the highest honors of the Bar. He is already entrusted with the management of causes of the greatest importance, which he always conducts with distinguished ability.
In his opinion on the bill first referred to him, he says:
“The bill referred to the Attorney. General, declares that asso. ciations for banking, may be formed by twenty or more persons, ‘with the rights and powers, and subject to the conditions and liabilities’ in said bill prescribed. (§1.) The capital stock of the association is to be divided into shares, and which shares are to be personal property. (§3, 31.) It shall continue for twenty-five years, and ‘be composed of persons who shall from time to time be stockholders.’ (§ 4.) It shall not be “dissolved by the death or act of any stockholder.” (§ 31.) Its concerns are to be conducted by directors, and to whom the capital stock is to be paid.’ (§ 2, 8.) The “association shall have power to carry on the business of banking' in all its branches, including ‘the issuing of bills, notes and other evidences of debt, and may exercise such other incidental powers as shall be necessary to carry on such business. It may make by-laws for the management of its property, the regulation of its affairs, and for the transfer of its stock. (§ 11.) It may purchase, hold and convey real estate for particular purposes, and under particular circumstances: but not “in any other case or for any other purpose.” (§ 12.) It shall take a name and by which it must contract, but it must sue and be sued in the name of the office of president of the association, “without naming the individual.” Suits by and against the “company” are to be prosecuted “in the same manner and with the like effect as suits and proceedings by and against corporations,” and judgments and decrees therein shall be executed in the same manner. (§ 3, 14.) Officers and stockholders shall be liable and answerable in the same cases, to the same extent, and in like manner, as the officers and stockholders of incorporated banks created since the year 1828. (§ 15.) The obligations and contracts of the association “shall be obligatory on the association, and be assignable and negotiable in like manner as if made or issued by a private person.” (§ 17.) These associations are declared to be subject to the provisions of the safety fund law of 1829, and to all general laws in force in relation to incorporated banks. (§ 27, 1, 37.) Their capital is to be taxed like that of incorporated banks, and the stockholders, are in like manner exempt from taxation. (§ 34.)
“The bill was manifestly designed to confer on banking associations, which may be organized under its provisions, every essential attribute of a corporation.
“Every such association is to have succession by the name it
would be bodies corporate, and that the assent of two-thirds of all
the members elected, is requisite to the passage of a bill for their
creation. - • “2. As the bill assumes to provide for the creation of an unlimited and indefinite number of these corporations, at the mere pleasure of individuals, it is for that reason unauthorized by, and in derogation of the constitution.” [Ib. Doc. No. 304, p. 7.]
On the 25th of April, the Assembly, on motion of Mr. Robinson, “Resolved, that the General Banking Law, together with the opinion of the Attorney-General thereon, be referred to a select committee, to consider and report thereon.” Messrs. Robinson, Clinch, and Patterson, were the committee.
On the 29th of April, that committee, by Mr. Robinson, re
ported: - “That they have carefully examined the different sections of the bill under consideration, and compared its several provisions with the constitutional objections raised by the Attorney-General ; and . have made such amendments thereto as, in their opinion, deprives the bill of those attributes which, in the view of the Attorney-Ge. neral, would require the assent of two-thirds of the members elected, to its passage. Your committee are also of opinion, that the bill, as now amended, will not conflict in any other particular with the ninth section of the seventh article of the constitution as construed
by the Attorney-General. - “Your committee have not deemed it a necessary part of their
duty to investigate the validity of the objections raised by the Attorney-General to the bill on which his opinion was required; they therefore do not report any conclusion thereupon. “The bill, as amended by your committee, is herewith presented, and this report respectfully submitted.” [Ib. Doc. No. 318.] This report was unanimous, having been signed by all the
Two days afterwards, viz., on the first day of May, the House went into committee of the whole on the bill, amended it, as recommended by the committee, and agreed to it; and the report of the committee was accepted by a vote of forty-nine to twentysix, and the bill ordered to be engrossed. It was read the third time the next day, and referred to the Committee on two-thirds