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24th Cong. 2d Sess.]

Claim of United States on U. S. Bank.

But it is a source of much satisfaction to this Depart- to what the bank now offers. So far, therefore, from any ment now to learn that, after more mature deliberation, “menace,” or any thing which common fairness could torone of the banks in behalf of which that committee acted (ture into an attack on " constitutional freedom," having, as has determined to accept the terms recommended by our the memorial intimates, been used in any of the communicaagents as to the valuation of the shares, and has thus giv- tions from this Department connected with this attempt at en a sanction to the correctness of their course in making an adjustment of any part of our claims, not the slightest and insisting on a much higher estimate of the value of the pretence exists for the charge in the instructions on this shares of the United States than the first or the second point, the whole of which were as follows: committee of the bank were willing to adopt.

“4. It is further wished that, in forming an opinion of The other subject referred to in the memorial, viz: the the value of the assets of the bank on the 3d of March, you damages upon the bill of exchange drawn on the French should take into consideration the amount of dividends due Government, and the dividends sequestered and withheld to the United States which has been withheld and applied upon that pretension, has been heretofore so fully discuss- by the bank in payment of a claim for damages on the ed that I forbear now to enter at all into the consideration draft or order drawn by the Department on the French of its merits. But it is a matter of some surprise that the Government. Under all the circumstances of that case, authority or course adopted by this Department in attempt this Department cannot recognise the right of the bank to ing to make an adjustment on that subject, under the act any thing except the actual expenses incurred by it in of June last, should appear to be impugned by the memo- consequence of the failure by the French Government to rial, on the ground that the power conferred by the act did pay the draft, with the usual interest thereon, while the not warrant its proceedings. The power extends to the bank had not the use of the money, provided it did not settlement and adjustment of the “ capital stock” and have the use of it during the whole period till its formal " surplus profits.” But it is to be observed that the divi- repayment. For further particulars on this question, refdends withheld on account of the damages claimed by the erence can be had to the printed opinions of the Attorney bank chartered by Congress had been carried to the profit General, and the views of this Department in the annual and loss account, as was stated by the committee of the reports to Congress, December, 1834. It would therebanks, or in effect had been added to the amount of surplus fore seem proper, and it is submitted to your consideraprofits, and now constitute a part of those surplus profits. tion, and that of any committee uniting with you on the Is it not, therefore, obvious, that before the whole amount part of the bank, whether the claim for constructive damaof surplus profits realized by the bank chartered by Con- ges had not better be relinquished by the bank, and only a gress can be correctly ascertained, and the value of the full indemnity for any actual loss be received, and the valshare of the United States in those profits settled, it should ue of the stock be estimated on that basis-the bank, in first be determined, if possible, whether the bank shall re the mean time, paying over the dividends to the United tain the whole of those dividends or not?

States which were withheld in 1834." It therefore became proper to attempt the arrangement But though the agents of this Department properly proof that question in the first instance. Hence, in the in- ceeded to effect a future amicable adjustment, if possible, structions to the agents of this Department, they were re- in full or in part, notwithstanding the refusal to pay tlie quested to urge the bank to pay over the dividends with dividends withheld, yet they did this, not with a view of held, except the sum equitably due to the bank for interest abandoning the claim of the Government for the whole of and any actual expenses incurred. But they were not di- those dividends, after deducting any interest or actual exrected, as represented in the memorial, to insist on that as penses due; because it was a claim always insisted on by a “preliminary” indispensable to the receipt of any por- this Department as just, a claim so well sustained by equition of what was due, or indispensable to an agreement as table and legal principles, and a claim which had been so to the value of the shares. Had the bank acceded to this ably supported by the official opinions of the highest law request, the profits, now forming a part of the basis of a officers of the Government. Nor can the Department now proposed arrangement, would then have been reduced to recommend to Congress any relinquishment or comprothe extent of the difference, or probably about $160,000, mise of it. In respect to the right or propriety cf the bank and the share of the United States to about one fifth of chartered by Pennsylvania to arraign the course of this those profits would have been estimated proportionally Department on the present subject, even had it been 60 less. But, instead of receiving only one fifth of it as prof "unauthorized and unfortunate" as the memorial suppoits, they would have obtained, as dividends due, the whole ses, I shall not now stop to inquire, because Congress must of the other four fifths, being over $130,000 more, and be well aware that the signer of that memorial is not, and for which have so long been withheld from them by the bank. near a year has not been, president of the United States

Hence the agents very properly deemed it a “prelimi- Bank chartered by the General Government; that this Denary” question to settle, if practicable, how much of those partment has opened no correspondence with him or the dividends should be included among the profits, and ac- State bank in respect to this claim and its settlement, but cordingly used the language in their report, which is in- merely replied with courtesy to any communication he correctly attributed in the memorial to this Department. might choose to volunteer on the subject. The efforts of But though the committee of the bank declined paying this Department have rather been directed to induce the over any of those dividends, and insisted on holding the Bank of the United States chartered by Congress, and its whole as profits, this circumstance did not, as my instruc-oflicers, to make a scasonable and just arrangement upon tions show, or as the course of the agents of the 'Treasury this embarrassing affair. proves, prevent the agents from proceeding to make an ex The United States own no stock in the bank in behalf amination, and to attempt an agreement as to what ought of which this memorial has been presented to Congress; to be considered the true value of the shares. Neither of indeed, they are expressly excluded by the terms of its charthe committees regarded the failure to agree to pay any of ter from any direct interest in it. Unless Congress may the dividends as a preventive to an arrangement of the choose to release its claim upon the bank chartered by itrest of the subject. They proceeded, therefore, to estimate self, and accept the bank chartered by the State of Pennthat value on the basis assumed by the bank, that the sylvania as its debtor, either in the capacity of trustee or whole of the dividends withheld were to be regarded as substitute, the United States have no immediate claim among the surplus profits, and the agents of the Department whatever upon the latter institution. The bank chartered tried in vain tò bring the committee of the bank, even on by Congress is still in existence for the purpose of settling their own basis, to place an estimate on that value equall its affairs and paying over what is due to its stockholders,

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It has a president and all other necessary officers, and it is / with great unanimity, that such a course would be entirely for Congress to decide whether a new debtor-a new cor useless and unavailable as to obtaining any information of poration, over which it possesses less legal control-shall the fact; that no information would be obtained of service be substituted for the bank originally chartered by its own in their investigation, or leading to any satisfactory result. authority, and which has not heretofore made, and does That the committee should so unanimously come to this not now make, directly, any specific offer of payment or conclusion will not be matter of surprise, on a recurrence compromise.

to the history of the conduct of the oíficers of that instituBut the corporation created by the State of Pennsylva- tion for the last few years. It may not be improper to renia is represented to have become the trustee of that one ser to a few of these instances, furnishing a justification of chartered by Congress, and may be now acting in its be- such inference. half, though it never has become its trustee by the con Passing over the concealment of matters from the comsent of the United States or of this Department. If regard-mittees of both Houses of Congress in 1832, and the exed as amply able and safe for the fulfilment of any obliga- clusion of the directors appointed on the part of the Gov. tion it may enter into with regard to this claim, whether ernment from any participation in its transactions or with or without collateral security, it would seem to be knowledge of its affairs in 1833, a reference will be here proper that authority should be given, by some law or joint made to other acts of a more recent date.

In January, resolution, to accept its obligations, under such limitations 1834, the officers of that institution refused to deliver over, as sound prudence may dictate, considering the character on the order of the Secretary of War, the books, papers, of the institution and the great amount of the debt.

and funds, connected with the disbursements to be made Without such authority, the Treasury Department to the officers and soldiers of the revolutionary war, under would not of course feel justified in making any arrange- the pension law of the 7th June, 1832. (See vol. 2. of ment whatever with the State bank in question, or with its Reports of Comınittees of the House of Representatives of officers, in respect to this important claim, and by such 1833-'4, No. 263, and particularly the letter of its presi"unauthorized” course to change the debtor of the Govern dent, Mr. Biddle, of the 23 January, 1834, in which he ment, and perhaps lessen what Congress might consider reports the decision of the directors, distinctly refusing to its present legal security for eventual payment.

comply with the order of the Secretary of War.) On the Whether the bank will or " will never differ with Con- 4th of April, 1834, a resolution, reported by the Commitgress about mere sums of money,” and whether in respect tee of Ways and Means in the House of Representatives, to the French bill “the pecuniary interest involved was was adopted by the House, providing for the appointment and is a matter of indifference" or not, after its two com of a committee to investigate the affairs of the bank, under mittees differed so much from the views of ours, and “the the 23d section of the act of Congress incorporating it, of pecuniary interest involved" has been insisted on till now, the 10th April, 1816, which provides that “it shall, at and after its large contested claim to withhold the dividends all times, be lawful for a committee of either House of Conwas and is yet persisted in, though so manifestly inequita- gress, appointed for that purpose, to inspect the books and ble, might have been deemed questionable but for the dec- to examine into the proceedings of the corporation hereby larations in the memorial, which, it is hoped, may be hap- created, and to report whether the provisions of this charter pily successful in removing all future doubt or difficulty on have been violated or not,” &c. This committee was those points. But should any misfortune, so much to be clothed with power to send for persons and papers, and deprecated, prevent that desirable result, certain it is that proceeded to the banking-house in the city of Philadelthe bank cannot be more anxious than this Department to phia, and resorted to every fair means to obtain the necesavert the hazard of any further mediation" connected with sary information for the action of Congress; but the offiit, and to enable the president and directors of the institu- cers of the bank refused permission to the committee to intion chartered by Congress, at the earliest possible mo- spect the books or examine its proceedings, and even rement, “to terminate their connexion with the Govern- fused to be sworn to give evidence on the subject, or furment."

nish any information whatever, on the ground that they Respectfully, yours,

were not bound to criminate themselves; and entered into LEVI WOODBURY, a system of special pleading in excuse, and boldly set at de

Secretary of the Treasury. fiance the power and the rights of the people, through their Hon. Silas WRIGHT,

representatives in Congress. (Vol. 4, Rep. of Com. H. Chairman of Committee on Finance of the Senate. Reps. 1833-'4, No. 481.) On the 13th July, 1834, the

Secretary of the Treasury addressed a letter to the presi

dent of the bank, relative to the seizure and detention, by NOTES OF THE BANK OF THE U. STATES.

its officers, of the money in its possession belonging to the

United States. To this letter no reply was given until the HOUSE OF REPRESENTATIVES, FEBRUARY 22, 1837.

28th of November, a period so late as to defeat an opporMr. Galbraith, from the select committee to which the tunity of that reply being submitted to the President of tho subjeel had been referred, made the following report : United States in time for his remarks upon it, and the law

The select committee, to which were referred certain less and indefensible conduct of the officers of the bank in memorials relative to an amendment of the constitution of that act, in his annual inessage of that year. The high the United States in relation to banking corporations in the and aristocratic tone of that communication, made after States, and in relation to the reissues of the notes of the four months' delay, manifests any thing else than a disBank of the United States, beg leave to report in part, position to furnish any satisfactory information, whenever viz: on that portion of the said memorials in relation to the it may not be the interest of the bank that it should be reissues of the notes of the late Bank of the United - afforded. (Vol. 2, Ex. Doc. of 1834-'5, No. 21.) A simiStates.

lar tone plainly marks the conduct of the bank and its ofliAt the first meeting of the committee, the propriety of cers in the correspondence between its president and the addressing a communication to the directors of the Bank Secretary of the 'Treasury, in relation to the branch drafts of the United States chartered by Congress, with a view which had been illegally and unlawfully imposed upon the of ascertaining whether the notes of that institution, re- public hy the bank. (Vol. 2, Ex. Doc. of 1834-5, No. 42.) turned and redeemed since the 3d of March, had been re- Again, on the 14th October, 1834, the President of the Uniissue:), and if so, to what extent, and of what donomina- ted States addressed a comunication to the Government tion of notes, was suggested. The committee decided, directors of the bank, requesting thein "to report to him,

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with as little delay as possible, the gross profits made by seen, been denied. It is also stated, by the commissioners the bank, of every description whatever, for each half year appointed by the Secretary of the Treasury, on the 21st since the 1st January, 18:32— the deductions in detail made September last, to investigate the claim of the Government from those profits," &c.—in order that “he might be able upon the bank, after their investigation as far as permitted, to take a proper view of the subject of the public revenues in their communication to the Secretary of the 25th Januin his communication to Congress.” After yarious fruit- ary last. (Sec Doc. No. 118, Ho. of Reps., of the present less efforts to examine the books of the bank, the Govern- session.) They say at page 6 of that document, “the ment directors were informed by the second assistant bank was not in fact closed when its charter terminated; cashier (the cashier himself having kept out of the way) that no winding up of its business took place on the 3d of the book they particularly desired was locked up in the March ; its accounts were carried on without interruption, vault, the key of which he then had in his pocket, but re- previously and subsequently to that day; and its semifused to deliver to them. (Vol. 2d, Ex. Doc. of 1834-'5, annual settlement on the 1st of July, 1836, embraced the No. 15.)

entire transactions from the 1st of January preceding, The commissioners appointed by the Secretary of the without reference to the change that had occurred in the Treasury, in carrying out the provisions of the act of Con mean time;" and they speak of the business of the bank gress of the 230 June last, to examine the affairs of the being blended with the affairs of the new institution," bank, on the 4th November, gave to the committee ap “to which the books had been transferred," &c. At page pointed on the part of the bank a memorandum of points 14, speaking of the denomination of notes comprising the on which they desired information, embracing, among circulation, they say: "The fact that $10,142,038 had other things, the only matter of which it would have been been redeemed in the interval which elapsed between proper for your committee to seek information from the offi- the termination of the charter and the 12th of October cers of the bank. The same evasive, technical, and un afforded us no guide by which to form an opinion; because sati factory course was adopted by these officers which had the Bank of the United States chartered by the State of heretofore distinctly characterized them. The points of Pennsylvania, and charged with the redemption of the that memorandum referred to are these : “What de circulation, continued during that time to pay out the nomination of notes composed the nett circulation of the notes originally issued by the Bank of the United States bank at that time?" (30 March, 1836.) “ Have any of chartered by Congress.' From this testimony your comthe notes of the bank been reissued since the 3d of March, mittec believe, as before observed, there is no doubt of the 1836 ; and if so, to what amount ?" To these points the existence of the fact of the reissues of the notes of the Bank committce on the part of the bank replied : The de- of the United States, as suggested in the memorials; but it nomination of the notes composing the nett circulation of is claimed as a matter of right to reissue such notes since the bank cannot be ascertained."** “The Bank of the the expiration of the charter. United States chartered by the State of Pennsylvania has, Your committee distinctly and unhesitatingly deny the it is understood, done as other banks have done, paid out existence of any such right, and proceed to examine the the notes of the Bank of the United States; but of this the grounds on which it is claimed. Bank of the United States has no official knowledge ; nor This claim of right is sought through an alleged charter, has it any concern in the matter, as the new bank is bound obtained from the Legislature of the State of Pennsylvania, to redeein all the notes of the old bank."

by an act passed by that body on the 18th February, 1836, With this continued history of systematic concealment, entitled “ An act to repeal the State tax on real and peron the part of the bank, of all information from the Gov- sonal property,” &c. The second section of that act pro. ernment and its officers, agents, and committees of Con- vides that " the present stockholders of the Bank of the gress before them, your committee have deemed it vain and United States, excepting the United States and the Treasuseless to seek for any satisfactory information on the sub urer of the United States, and such other persons as may ject to which their inquiry would necessarily lead, by open become stockholders, agreeably to the by-laws made for ing a correspondence with the officers of the bank, if even that purpose, to an amount not exceeding in the whole the they should ask and obtain power to send for persons and present capital of the said bank, their successors and assigns, papers. Your committee have therefore entered upon the be, and are hereby, created a corporation and body politic, consideration of that branch of the subject relating to the by the name and style of the president, directors, and reissue of the notes of the Bank of the United States since company of the Bank of the United States,' and shall so the expiration of its charter on the 3d of March last, to continue until the third day of March, in the year one which their attention has been called by the memorials, thousand eight hundred and sixty-six,” &c. The stock of with the best lights before them.

the United States, about $7,000,000, was thus excluded, Although your committee cannot speak with official cer- by the terms of this State act, and the institution authorized tainty in relation to the fact of the notes of the Bank of the to take in, by its by-laws, other stockholders instead of it, United States, which had been returned to the bank and not to exceed the original amount of capital, $35,000,000. redeemed since the 3d of March last, having been reissued, Shortly after this alleged act of the Legislature of Pennsyland again thrown upon the community, or to what amount vania passed, an election was held by the individual stocksuch reissues have taken place, yet it is believed there can holders, for directors of the Bank of the United States exist no doubt of such having been the case, to the extent chartered by Congress; and another election, by the same of almost the entire issues of the State bank of the same stockholders, for directors of the same institution, as alleged name since that period, and that no new issues have been to be continued by the State of Pennsylvania. On the 2d made excepting a single emission of the denomination of day of March, 1836, the day previous to the expiration of ten dollars. The whole concurring testimony inevitably the charter granted by Congress, the directors of that instileads to that conclusion. It has been asserted over and tution, thus elected by the individual stockholders- the over again, in the public prints, for more than nine months Government of the United States, although owning one past; it was asserted on the floor of the House of Repre- fifth of the stock, having no participation in the electionsentatives, by the chairman of the Committee of Ways and transferred to the directors of the new or continued bank, Means, as early as May or June last, on the authority of a majority of them being the same men, all the funds of the letters from a respectable source ; gentlemen of the first institution, of every description, including, of course, all respectability from the city of Philadelphia, the location of its notes, bills, properly, &c., and the latter directors, for the bank, have spoken of it as a matter generally known the new bank, assumed all the obligations of the bank and conceded; and it has never, as the committee have chartered by Congress; in other words, the individual

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directors of the bank chartered by Congress, by the formal loss. If the construction be correct, it imposes the obligaceremony of a resolution of one board of directors elected tion so much the more strongly upon the institution, and by them, transferred to themselves, through another board, indirectly upon Congress, to relieve the community from a of nearly the same men, elected by them, adopting another description of circulation which may become dead and resolution accepting the transfer, all the funds, shares, valueless in their hands. If it be a duty incumbent upon estate, property, &c., of the institution, assuming, by the the bank chartered by Congress to redeem and cancel the latter resolution, all the obligations of the Bank of the notes returned since the expiration of the charter on the 3d United States chartered by Congress ; thus virtually be- March last, it is equally obligatory upon any individual or coming its trustee, or assignee, voluntarily charged with corporation, State or national, charged with the performall the obligations and duties incumbent upon the expiring ance of its duties, to do the same thing. Tho position, institution.

therefore, that there is or can be a right any where to reThe funds and property of the bank chartered by Con- issue the notes of the bank chartered by Congress, returned gress, including its notes, its Government stock, moneys, since the 3d of March last, and redeemed with the funds of effects, and estate, being thus transferred to the alleged new that institution, either by its own officers directly or institution, constituting its entire stock and funds, on the through the instrumentality of a trustee or assignee, your accepted condition and voluntary assumption of discharging committee cannot but regard as both false and dishonest. all the obligations and performing all the duties of the ex- That, on the contrary, such reissues are a cheat upon the piring bank, the whole matter is resolved to the single community, a fraud upon the Government, and in direct point of inquiry : What are the obligations and duties of contravention of the plain and undoubted intention of the the bank chartered by Congress, under its act of incorpo- act of Congress granting the charter. ration, after the 3d of March, 1836, the day on which it ex To illustrate and simplify this, let us suppose a similar pired for all active business purposes, as clearly provided in case of individuals. A and B enter into a partnership for the 7th section of the act of the 10th April, 1816 ? The the purpose of carrying on any particular business, say 7th section fixes the termination of its active existence merchandising, for a certain period, and to terminate on a on the 3d of March, 1836; the 21st "section provides that, given day prescribed by their agreement. A vests in the “notwithstanding the expiration of the term for which the concern $7,000, and B four times that sum, $28,000; and said corporation is created, it shall be lawful to use the B assumes the management and control of the entire concorporate name, style, and capacity, for the purpose of suits, cern. It is agreed that, at the expiration of the time stipula

for the final settlement and liquidation of the affairs and ted, the name and style of the firm shall be used for the accounts of the corporation, and for the sale and disposition purpose of suits for the final settlement and liquidation of of their estate, real, personal, and mixed; but not for any the affairs and accounts of the partnership, but for no other purpose, or in any other manner whatsoever, nor for other purpose, nor in any other manner. B appoints as a period exceeding two years after the expiration of the many clerks or agents as are necessary to conduct the afsaid term of incorporation." From the terms of this sec- fairs of the concern-they issue promissory notes, &c., in tion, taken in connexion with those of the 7th, the in- the name of the firm "A and B.” The day previous to tention of the act of Congress chartering the bank is too the expiration of the partnership, one of the clerks appointclearly expressed to be mistaken by any body ; that, up to ed by B, for the firm, transfers all the effects and funds of the 3d of March, 1836, it was enabled to perform all the the firm to another of the clerks, for the use of B, he enfunctions for which it was created—such as discounting gaging to discharge all the obligations and duties, and pay notes and bills of exchange, issuing and reissuing its all the debts due by the firm of A and B, and particularly notes, &c. ; that after that period it could perform no act the original stock due to A. After the expiration of the but such, and such alone, as should be necessary to the partnership, the business is continued by B. The notes

liquidation of the affairs and accounts of the corpo- of the firm are presented, paid out of the funds of the partration," and the sale and disposition of its property ; the nership, and reissued by the clerks of B, under his direcwinding up of its concerns—such as calling in its bills in cir. tion, thus rendering the funds of the partnership again liable culation, redeeming and cancelling them, collecting its for their payment; and besides, B refuses to settle or pay debts, and settling with its creditors and stockholders. The over to A the amount of his stock invested. Who would reissuing of its notes is the same thing as the original is- have the hardihood to defend this as an honest transaction, suing, and requires the exercise of precisely the same func- either towards the other partner or the community, upon tion-the performance of an active business duty-either whom the notes of the firn were thus thrown, after being employs the "name, style, and capacity,for another redeemed out of the funds of the partnership ? . The indipurpose, and in another manner, than that for the "final vidual who would attempt such a transaction could not sussettlement and liquidation of the affairs," &c., and tain a character in any commercial community where chartherefore clearly forbidden by the terms of the 21st acter is regarded. If it did not constitute a forgery, so that section of the act. It is also indicated that this busi- he might be indicted for that crime, yet it would approach ness of the liquidation of the affairs and accounts of near to it, and probably constitute the crime of chealing the corporation” shall be performed within the limited with false pretences. It would, at all events, justly stamp period of two years—a period supposed to be sufficient to re- such individual with infamy in any correct community, as deem all the paper in circulation, and collect all the debts entirely unworthy of all trust or confidence.

Is the same due, and settle with all creditors. This could never be done thing less unjust or fraudulent because committed by a corif the redeemed notes of the bank should continue to be poration? I'he riglit to reissue the notes of the Bank of reissued as before the expiration of the charter. Indeed, it the United States, returned since the 34 March, is just the is contended by many, that those who happen to be the right, and no other, that any one has for the commission holders of the notes of that bank, after the expiration of the of a glaring and palpable fraud. It cannot be derived two years, (3d March, 1838,) could not recover the amount through the transfer from the directors of the old bank, from the bank, construing the limitation of " suitsto ap- made on the 2d March, 1836, to the directors of the alleged ply to the capacity of being sued as well as suing. Your new bank, representing precisely the same stockholders, as committee do not consider it necessary to decide that ques- its last will and testament, because they possessed no such tion; but the position is not without plausibility, inasmuch right to transfer ; but, on the contrary, were bound by the as the provision in the 21st section may be viewed as terms of the charter to settle and wind up the affairs after giving notice to the community, holding the notes, to re- the 3d of March, or, in other words, were forbidden to isturn thein within that period for redemption, or suffer the sue or reissue their notes after that period. The directors

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of the old bank, not having any right to issue notes, could I ly counterfeit notes, being genuine in point of form, signed transfer no right to their assignee. It cannot be derived by the persons whose signatures they bear, and originally through the charter granted by the Legislature of the Stato what they purport on their face, but spurious in substance, of Pennsylvania, because, first, the act of Assembly of that having been once redeemed from the basis originally liable State does not profess to vest any power in the bank to re for their redemption, and that basis removed and transferissue the notes of the old bank ; and because, secondly, if red to another corporation, created by State legislation, it did, it uld, so far, be absolutely null and void, being which may or may not redeem hem, at the pleasure of in express contravention of the act of Congress. It is not its officers, or as their interests may determine; and after the purpose or within the duty of the committee to inquire the 3d of March, 1838, beyond which they will of course into the manner and means by which the charter was ob- continue to circulate, if continued to be reissued, still rentained from the State, or into its provisions ; but it may not dered more doubtful of payment by the additional legal obbe out of the way here to remark that, so far from the Penn- stacle interposed to their recovery, should payment be resylvania act authorizing the bank to reissue the notes of the fused. It may be said, however, that the Bank of the Bank of the United States chartered by Congress, it inter- United States chartered by the State of Pennsylvania, to dicts a large portion of such reissues as have taken place which the funds and property of the Bank of the United since the 3d of March last. The 6th article of the 4th sec States have been entirely transferred, has undertaken to tion of the act of the Legislature of Pennsylvania provides : pay all debts due from it, and to discharge all its obli. "And the notes and bills which shall be issued by order of gations. But to whom is that undertaking made ? Not said corporation, or under its authority, shall be binding to the holders of the notes. There is no privity between upon it, and those made payable to order shall be assigna- them and the new corporation ; and, on the presentation of ble by endorsement, but none shall be issued of a less de- such notes to its officers, they might reply, without a greatnomination than ten dollars.Now, inasmuch as the er violation of obligation than they have often before comnotes of the old bank constituted nearly the entire issues of mitted : “It is true we had undertaken to discharge the the bank professed to be chartered by the State, and a large debts of the bank chartered by Congress, but that was only portion of those issues consisted of notes of a less denomi an arrangement for our own convenience among ourselves, nation than ten dollars, such issues were not only in con- and we have already redeemed more of its notes than the travention of the act of Congress, but in direct and gross amount of funds received from that source, and we cannot violation of the very act of the State Legislature through redeem any more ;" and, in the complicated state of its which the right of reissuing those notes is claimed for it. affairs, it would be hopeless for any one to show to the conIn the reply of the cominittee of the bank, before quoted, trary; and if he could, the cost might overrun the recovthey say: “The Bank of the United States chartered by ery, to say nothing of the delay and disappointment. A the State of Pennsylvania has, it is understood, done as new and a different responsibility from that expressed on other banks have done-paid out the notes of the Bank of the face of the notes is substituted, without the holder's the United States ;" placing that bank on the same footing consent, and not necessarily within his knowledge, which with others receiving the notes of the old bank in the course may or may not turn out insolvent, which is unjust to the of their own regular business. The error committed here country. is too glaring and manifest to be attributed to mere miscon The example is calculated to have a pernicious effect cep:ion or misapprehension of the relation in which the upon the commercial community. If a trick of this kind, Bank of the United States, chartered by the State, stands practised by the officers of the bank, should pass unnoticed both with regard to the old bank and the Government and unpunished, others, even less honest, may be tempted That a bank or an individual, receiving the notes of the to even greater outrages upon commercial fairness and inbank which had expired on the 3d of March, in the ordi- tegrity, until all commercial confidence be destroyed. nary course of their own business, might pay them out The stock of the Government of the United States in again in the same way, no one would pretend to deny ; the bank, estimated by a committee of the individual stockbut what child does not at once perceive the different po- holders themselves at $7,583,698 59, and by the commissition occupied by that institution, and that occupied by all sioners appointed by the Secretary of the Treasury at other institutions and individuals, both with regard to the $8,110,215 09--the money of the people of this countryGovernment of the United States and the bank of the Uni- is withheld from them, and placed, without their consent, ted States chartered by Congress, in this particular? If at the disposal of a few bank directors, in whose selection they receive such notes, they receive them as their own, they have no participation—to be wasted or speculated upand on their own account; the Bank of the United States on, at the pleasure of bank officers, of whom the people chartered by the State of Pennsylvania, receiving the Gov. know nothing. The people's money is thus - siezed upon ernment stock and moneys belonging to the United States, and detained for the purpose of redeeming notes over and and all the funds of the bank chartered hy Congress, is over again, reissued in violation of law and obligations volplaced in possession of its notes, under a special trust to untarily assumed. Had this sum been paid over to tho discharge all the obligations of the old bank, one of which United States, or even half of it, a large increase would is to wind up is affairs, or, in other words, not to reissue have been made to the amount deposited with the different ils notes, and it cannot reissue them but in violation of States, lo be applied to the purposes of the country, under that trust.

the deposite act of June last. Without expressing any The committee having, as they believe, satisfactorily opinion here of the policy of that act, your committee deem shown that the notes of the Bank of the United States it their duty to assert the right of the Government, under chartered by Congress, returned and redeemed from the the control of the people, to the possession of what iš duo funds of that institution since the expiration of its charter, have been since reissued and put again into circulation, rect, without the hinderance or obstruction of any board of and that such reissuing is without right, fully sustaining bank directors. It may be said that the Government have the views of the memorialists, it remains to inquire into the a security, in the obligation of the Bank of the United niischief, and the power of Congress to provide a remedy, States chartered by the State of Pennsylvania, for the pay. and what remedy is most proper and appropriate.

ment of its shares in the stock of the Bank of the United One of the mischiefs arising from this reissuing of notes, States chartered by Congress. Your committee reply, that once redeemed from the source upon the responsibility of this undertaking is not given directly to the Government : which they were originally issued, is the deception practised and if it were, there is a difference between obligation and upon an unwary community. It is true they are not strict payment; and in the instance under consideration, that

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