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them to the New Orleans National Banking Association. On the other hand, it is insisted by the complainants, and by the assignees in bankruptcy of Cavaroc & Son, that the hypothecation simply contemplated securing Schuchardt & Sons to the extent of $100,000 in advance of transmission to them of exchange; and, to the extent that bills of exchange were transmitted, the terms of the hypothecation were satisfied, although the exchange proved uncollectible.
Some obscurity exists as to the just interpretation of the agreement, because the correspondence is in a foreign language, and the meaning of the term “a decouvert” is not entirely clear. On the one hand it is claimed to mean "unsecured," and on the other to mean "uncovered.” But, reading the correspondence in the light of surrounding circumstances, it is not difficult to conclude that the hypothecation should be construed as intended to protect Schuchardt & Sons for any overdraft that might arise in the course of the transactions between the two banking concerns to the extent of $100,000. The bonds were evidently to be a continuing security until some new arrangement should be made. That they were to be security for an overdraft, in the ordinary meaning of that term as used between bankers, may be gathered from the correspondence. In his letter of February 15th the cashier of the banking association indicates such to be his understanding, and speaks of overdraft and drafts in advance of remittance as convertible terms. The correspondence also indicates clearly that the terms "a decouvert" and "overdraft” are synonymous. When the cashier asked permission to draw "a decouvert,” and is answered by Schuchardt & Sons that the credit "a decouvert” was predicated upon the security of the bonds, the cashier replies that he had not understood the bonds were ever deposited to guaranty such “overdraft.” Agsuming that the language of the pledge is that the bonds were to be a security, to the extent of $100,000, for any uncovered balance due from the banking association to Schuchardt & Sons, that uncovered balance must be held to mean any existing overdraft which might from time to time arise. Whether at any time there was an overdraft, could only be ascertained from the accounts of the parties. As it had been their custom to debit the banking association with all remittances uncollected, the amount of such uncollected remittances became a part of the general debit balance. The amount of the overdraft from time to time could not be ascertained except by ascertaining the general debit balance against the banking association, which de
pended, to a greater or less extent, upon the items charged back to it for uncollected exchange.
Cogent evidence of the understanding of the banking association, and of C. Cavaroc himself, that the bonds were pledged as security for an overdraft arising in part from uncollected remittances, is found in the resolution of the directors of the banking association, adopted September 20, 1873, Cavaroc himself being present, which is as follows:
“Resolved, that with a view of securing the president against any eventual loss for the 232 city of New Orleans bonds belonging to the firm of C. Cavaroc & Son, and actually pledged to S. Schuchardt & Sons as collateral security for the payment of all foreign exchange bills sent them for negotiation, and by them indorsed, that he be and is hereby authorized to select as guaranty from the portfolios of the bank such papers he may think proper, to the extent of $100,000."
This statement is entirely inconsistent with the theory that the uncovered balance which the bonds were intended to secure was anything more or less than an ordinary overdraft. In short, it is evident from the relations of the parties, their course of business, the correspondence between them, and the construction placed upon the transaction by Cavaroc himself, that the bonds were pledged to secure Schuchardt & Sons for any overdrafts of the banking association, to the extent of $100,000, which might from time to time arise. Such overdrafts were the credit "a decouvert" contemplated by the parties, and constitute the unpaid balance of account due from the banking association to Schuchardt & Sons.
The conclusion is therefore reached that to the extent of $100,000 the defendant Fry, as trustee for Schuchardt & Sons, has a lien upon the bonds for the unpaid balance of the account of the New Orleans National Banking Association. In ascertaining this balance the sum on deposit with, or collected by, the Union Bank of London is to be deducted; and, as the receiver of the Louisiana National Bank has not answered, it is to be adjudged that he has no interest in the fund arising therefrom. The defendant Fry has also a lien upon the bonds to the amount of the balance of account due from Cavaroc & Son to Schuchardt & Sons. The bonds having been left by Cavaroc & Son with Schuchardt & Sons, without any special agreement, except the pledge of a portion of them for the New Orleans Banking Association, those not thus pledged are subject to the bankers' lien of Schuchardt & Sons. The liens of Fry are first to be satisfied out of the interest of Cavaroc & Sons, in the bonds as betweeu that firm and the complainants. Fry has also a lien by virtue of his attachment upon the interest of the complainants for the sum which may ultimately be recovered in the suit against the complainants. Of course, Fry must account for the amount of all coupons collected. It is understood from the statements of counsel that the rights of the parties being adjudged, the extent of their respective interests can be arrived at without a reference to a master. Upon filing a stipulation a reference will, therefore, be dispensed with; otherwise, a reference will be directed. Unless the parties otherwise stipulate, the decree will provide for the appointment of a receiver to sell the bonds and distribute the proceeds to the parties according to their respective rights. The defendant Fry is entitled to costs.
Second Nat. BANK OF TITUSVILLE, PENNSYLVANIA, v. CALDWELL and
(District Court, W. D. Pennsylvania. October Term, 1882.)
1. CONSTITUTIONAL LAW-TITLE OF Act.
Under the settled construction of section 3, art. 3 of the constitution of Pennsylvania, where an act of assembly is entitled, a supplement to a former named act, and the subject thereof is germane to that of the original act, its
subject is sufficiently expressed. 2. SAME-REVISION AND AMENDMENT OF STATUTE.
The constitutional provision: “No law shall be revived, amended, or the provisions thereof extended or conferred by reference to its title only; but so much thereof as is revived, amended, extended, or conferred shall be re-enacted and published at length," is sufficiently complied with if a supplement and
amendatory act is set forth and published at length in its amended form. 3. TAXATION-NATIONAL BANKS—REAL ESTATE TAXABLE.
Under the Pennsylvania act of June 10, 1881, entitled “a supplement to an act entitled 'An act to provide revenue by taxation,' approved the seventh day of June, 1879," the real estate of a national bank is subject to taxation
distinct from its other capital. 4. SAME-LICENSE TAX ON Bank.
A license tax imposed by city ordinance upon a national bank being a tax upon the operations of the bank, and a direct obstruction to the exercise of its corporate powers is unconstitutional; but the ordinance not undertaking to make the tax a lien, and giving an action of debt only for its collection, the bank is not entitled to equitable relief by injunction.
ACHESON, D. J. The plaintiff's claim to exemption from local taxation on its real estate rests upon the assumption that section 17 of the act of assembly of June 7, 1879, (P. L. 112, entitled "An act to provide revenue by taxation,” is still in full force. That section enacts that “in case any bank or savings institution incorporated by this state, or any national bank, elect to collect annually from the shareholders thereof a tax of six-tenths of 1 per centum upon the par value of all the shares of said 'bank or savings institution, and pay the same into the state treasury on or before the twentieth day of June in every year, the shares, capital, and profits of such bank shall be exempt from all other taxation under the laws of this commonwealth.” And if the plaintiff's hypothesis that this law is in operation were correct, there would be good ground for its complaint that its real estate has been illegally assessed with local taxes; for it was held in County of Lackawanna v. First Nat. Bank of Scranton, 94 Pa. St. 221, that the banking house of a bank is part of the capital represented by its shares of stock, and a tax upon the par value of the shares, is a tax upon it.
But after that decision was made, the legislature on June 12, 1881, passed an act entitled “A supplement to an act entitled An act to provide revenue by taxation,' approved the seventh day of June, one thousand eight hundred and seventy-nine,” the third section of which is in these words: "In case any bank or savings institution, incorporated by this state, or the United States, shall elect to collect annually from shareholders thereof a tax of six-tenths of 1 per centum upon the par value of all the shares of said bank or savings institution, and pay the same into the state treasury on or before the first day of March in each year, the shares, and so much of the capital and profits of such bank as shall not be invested in real estate, shall be exempt from all other taxation under the laws of this commonwealth.” The purpose of this section is not doubtful. Obviously the intention is to restrict the exemption from taxation conferred by the act of June 7, 1879, and to subject the real estate of banks to distinct taxation. Moreover, section 6 of the act of June 10, 1881, expressly repeals the seventeenth section of the act of June 7, 1879.
It is, however, contended on behalf of the plaintiff that the third section of the act of June 10, 1881, is inoperative and void, and for this several reasons are assigned :
1. The title to the act, it is said, is in conflict with section 3 of article 3, of the constitution of Pennsylvania : “No bill, except general appropriation bills, shall be passed containing more than one
subject, which shall be clearly expressed in its title." But it is the settled construction of this section that where an act of assembly is entitled a supplement to a former act, and the subject thereof is germane to the subject of the original act, its subject is sufficiently expressed to meet the constitutional requirement. State Line & Juniata R. Co.'s Appeal, 77 Pa. St. 429; Craig v. First Pres. Church, 88 Pa. St. 42. In the present case the supplement, from first to last, relates to revenue by taxation, and there is no provision in it incongruous with the original act.
2. It is insisted that the third section of the act of June 10, 1881, is in conflict with section 6 of article 3, of the constitution of Pennsylvania: "No law shall be revived, amended, or the provisions thereof extended or conferred, by reference to its title only; but so much thereof as is revived, amended, extended, or conferred, shall be reenacted and published at length.” It cannot, of course, be pretended that there is here any violation of the first part of this section, for there was no attempt to revive or amend the original act, or to extend or confer its provisions, by reference to the title only. The objection, as stated in the bill of complaint, is this : "that said third section materially amends the provisions of section 17 of the act of June 7, 1879, (to which it is a supplement,) and fails to re-enact and publish at length so much of said act of June 7, 1879, as is thereby amended." But does the constitutional provision in question require that a supplemental and amendatory act must republish the original act or so much thereof as is amended? This I understand is what is insisted on. It seems to me, however, that such is not the natural or true construction of the clause. It is to be read as a whole, and thus considered its purpose is plain. It was intended to prevent covert legislation and the passage of laws whose meaning and object are not fully disclosed. If there is no attempt to legislate by reference to the title of the old law, it is, I think, sufficient if the proposed law in its amended form is “re-enacted and published at length.” Treating of a similar constitutional provision, Mr. Cooley, in his work on Constitutional Limitations, page 185, well says that the requirement “is fully complied with in letter and spirit, if the act or section revised or amended is set forth and published as revised or amended, and that anything more only tends to render the statute unnecessarily cumbrous.”
3. Again, it is contended that the third section of the act of June 10, 1881, in so far as it would subject the real estate of national banks to taxation for local purposes, is inoperative and void for repug