Bailey v. Sawyer.

C. P. BAILEY, Receiver of the First National Bank of Duluth, v. ANDREW J. SAWYER.

1. In winding up an insolvent national bank the comptroller of the currency is vested with authority to determine when a deficiency of assets exists, so that the individual liability of the stockholders may be enforced, and no appeal lies from his decision.

2. The liability of a stockholder of a national bank is several. When a specific assessment upon the stockholders is ordered by the comptroller, a suit at law is a proper remedy to enforce it.

(Before NELSON, J.)

National Banks.- Liability of Stockholders.- Assessment by the Comptroller.-— Remedy.

THIS is a common law action brought to enforce the individual liability of a stockholder in the First National Bank of Duluth, and to recover the amount of an assessment ordered by the comptroller of the currency, to the extent of seventy-five per centum of the par value of the shares of the capital stock of said bank, under and by virtue of the act of congress in relation to national banks.

A demurrer is interposed to the complaint. Upon the argument it is urged:

1. That the complaint should set forth the facts and data upon which the comptroller determined that a necessity existed which authorized proceedings to enforce the individual liability of stockholders.

2. That the suit should have been in equity, and not at law.

Mr. W. W. Billson, for the demurrer.

Messrs. Ensign and Cash, contra.

NELSON, J.-The comptroller of the currency, by virtue of the national banking law, in winding up an insolvent bank, is vested with authority to determine when a deficiency of assets exists, so that the individual liability of the stockholders may

Bly v. United States.

be enforced. This liability is conditional, and was so held in Bank v. Kennedy, 17 Wall. 22, but the comptroller, in the exercise of a judicial discretion, decides, upon the data before him, when "it is necessary" to compel contributions from stockholders to pay the debts of the bank. The law clothes him with this authority, and no appeal lies from his decision by a stockholder. He appoints a receiver, and resorts to the ultimate remedy whenever, in his judgment, the condition of the bank requires its enforcement. And, as stated in Kennedy v. Gibson

et al. 8 Wall. 504, a more speedy settlement of the affairs of an insolvent bank is thus obtained. Again, this obligation of the stockholder is fixed when he becomes a member of the corporation by taking stock therein, and is several, not joint. There is no necessity for invoking the aid of a court of chancery to determine the sum each stockholder must pay, for that is regulated by the number of shares of stock owned. When the comptroller declares and orders an assessment, the precise amount each stockholder must contribute is a certain exact sum. A suit at law would seem to be the suitable proceeding to collect the

assessment.

DEMURRER OVERRULED.

E. H. BLY, plaintiff in error, v. THE UNITED STATES, defendant in error; B. F. HARTLEY et al., plaintiffs in error, v. THE UNITED STATES, defendant in error; THE UNITED STATES v. DAY et al. (indictment.)

1. In certain civil and criminal actions by the United States against trespassers upon its unsold timber land: Held, that the official plats and books in the office of the register of the United States land office are admissible as evidence on its behalf to show that the land on which the timber was cut had not been sold by the United States. 2. Parol evidence is not admissible on behalf of the defendants to show that the locus in quo was swamp land within the meaning of the swamp land grant to the several states.

Bly v. United States.

3. The cutting of timber upon the public lands is a criminal offence (Rev. Stats. sec. 2461), and the government may proceed both civilly and criminally.

4. Where timber is cut upon the public lands wilfully, fraudulently, or negligently, and without authority, and made into saw-logs, the government may replevy such logs even when they have reached the boom, or, at its election, may sue in trover for their value, and in either case may recover without deduction for their enhanced value, after severance from the freehold, arising from the labor of the wrong-doer. In such case the government is not confined to the “stumpage” value. (Nesbit v. St. Paul Lumber Company, 21 Minn. 491.) 5. Whether a different rule of damages would apply if the trespass were neither willful, fraudulent, nor negligent, quære?

(Before DILLON and NELSON, JJ.)

Cutting Timber upon Public Lands.- Evidence.- Remedy of Government.- Indictment.- Replevin.- Trover.- Measure of Damages.

THE government has brought numerous civil suits in the nature of trover to recover the value of pine saw-logs cut upon the public lands by the defendants or their vendors, and which, before the suits were commenced, had been rafted and brought down into the booms at Minneapolis, Brainerd, and other places. It has also caused the persons who cut the timber to be indicted. Certain questions of law arising in these cases were argued and decided as shown in the opinion of the court.

Mr. Billson, district attorney, for the United States.

Messrs. Davis, Bradley, Secombe, and others, for the plaintiffs in error.

DILLON, Circuit Judge.-1. I am of opinion that the official plats and books in the office of the register of the United States land office, produced and explained by that officer, were admissible in evidence on the part of the government to establish, or as tending to establish, the fact that the lands in question had not been sold by the United States.

Bly v. United States.

These plats and books are the official records of the office, and are kept by the register so as to show what lands are taken under the pre-emption, homestead, or other laws of the general government. These official records, in connection with the testimony of the register, showed that the locus in quo was vacant land which had never been disposed of by the United States, and were sufficient prima facie to establish that fact. (Galt v. Galloway, 4 Pet. 332, 343.)

2. Where the proof shows that the lands have not been sold or disposed of by the United States, and the government proves that the defendant cut timber thereon, and the defendant introduces no evidence of right or title from the United States or the state, we are of opinion that parol testimony on his behalf is not admissible to prove that the locus in quo is "swamp" land within the meaning of the swamp land grant.

3. The cutting of timber upon the public lands is made a crime by the legislation of congress, which may be prosecuted by indictment (Rev. Stats. sec. 2461), notwithstanding the provisions of section 4751. And the government may proceed against trespassers upon its land, civilly or criminally, or both, at its election, and judgment in one form of remedy is no bar to the prosecution of the other remedy. The principle of the decision of Mr. Justice MILLER in The United States v. McKee, ante,

has no application to such a case.

It sues in these cases civilly, as the proprietor of the trees or timber which have been unlawfully cut and removed from its lands, to recover the value thereof. And it prosecutes the trespassers criminally in its sovereign capacity for a violation of its criminal statute in that behalf.

4. Where timber has been cut into logs upon the public lands by a person who knows that the land belongs to the government, or who has no reasonable ground to believe that it belongs to him, or to some one under whom he claims, and such logs are by him hauled to the water-course, and rafted and taken to a distant boom, by means of which labor of the wrong-doer their value is much enhanced beyond their value when first sev

Bly v. United States.

ered from the freehold, the government may replevy such logs in the boom, or may maintain an action in the nature of trover for their value, and in either case may recover without deduction for the enhanced value which may have been given to the logs after the severance from the freehold, by the labor of the wrong-doer. In such a case the government is not confined to what is called the "stumpage" value, but may recover the value of the logs in the boom.

As in such case the title of the government to logs thus cut continues as against the wrong-doer and all persons (Town v. Dubois, 6 Wall. 548), until at least there has been some greater transformation of the original property than exists while it remains in the shape of logs, if the wrong-doer sells the logs to a person who has no actual notice that they were cut on the public lands, still the government may maintain replevin against such vendee for the logs, if they are in existence, or if he has sawed them into lumber (which is a conversion of the logs), the government may recover from him the value of such logs, when so manufactured into lumber, and is not confined to the "stumpage" value.

On this last proposition the authorities are conflicting, and we adopt and follow the decision of the supreme court of the state upon the point. (Nesbit v. St. Paul Lumber Company, 21 Minn. 491.)

The rule above laid down is the only one which will effectually protect the timber lands of the government which are remote from settlements and in the wilderness. As against the willful or negligent trespasser the rule of damage indicated is not unjust, and as against his vendee it is perhaps the logical and necessary result of the property in the logs still remaining in the government. At all events, it is the rule which has been approved by the supreme court of the state in the case before cited.

It may also be observed that the conclusions reached have a strong support in the adjudicated cases. (Silsbury v. McCoon, 3 Comst. 379; Riddle v. Driver, 12 Ala. [N. S.] 590; Betts v. Lee,