US LAWS, STATUTES and CODES : Chan Robles Virtual Law Library USA Supreme Court Decisions | Resolutions : Chan Robles Virtual Law Library

ChanRobles™ Virtual Law Library™ |™   
Main Index Repository of Laws, Statutes and Codes Latest Philippine Supreme Court Decisions Chan Robles Virtual Law Library Latest Legal Updates Philippine Legal Resources Significant Philippine Legal Resources Worldwide Legal Resources Philippine Supreme Court Decisions United States Legal Resources United States Supreme Court Jurisprudence ChanRobles LawTube - Social Network

ChanRobles Internet Bar Review : DebtKollect Company, Inc. - Debt Collection Firm Intellectual Property Division - Chan Robles Law Firm

Philippine Supreme Court DecisionsChanRobles On-Line Bar Review

google search for chanrobles.comSearch for


Subscribe to Cases that cite 231 U. S. 120 RSS feed for this section

U.S. Supreme Court

Clement National Bank v. Vermont, 231 U.S. 120 (1913)

Clement National Bank v. Vermont

No. 29

Argued April 28, 29, 1913

Decided November 10, 1913

231 U.S. 120


A tax upon deposits in a national bank to be paid by the depositors held in this case not to be a tax upon the franchise of the bank.

An interpretation by the state court of a state statute is controlling on this Court, and this Court determines whether the statute as so delimited conflicts with federal law.

The National Bank Act does not withdraw credits of depositors in national banks from the taxing power of the state.

Under its broad powers of classification for taxation, a state may classify depositors in national banks so long as the tax is not essentially inimical to such banks in frustrating the purpose of the legislation or impairing their efficiency as federal agencies.

The object of § 5219, Rev.Stat., is to prevent hostile discrimination against national banks, and a state tax, to be in conflict therewith, must constitute such a discrimination.

A provision in a statute permitting a bank to stipulate with the state to pay the taxes on deposits and thereby relieve its depositors from making returns does not place the bank under duress.

This Court finds no basis for the charge of injurious discrimination against national banks in § 815 of Chapter 37 of the Public Statutes of Vermont.

While a national bank can only transact such business as the federal statutes permit, it may, under its incidental powers, make reasonable business agreements in regard to its deposits, including the payment chanroblesvirtualawlibrary

Page 231 U. S. 121

of state taxes thereon pursuant to the laws of the state in which it is located. Such an agreement is not ultra vires.

A state may provide for garnishment or trustee process to collect a valid tax, and may constitute a bank it agent to collect the tax from its depositors.

A state tax on interest-bearing deposits in national banks does not deny equal protection of the law on account of exemptions which it is within the power of the state to allow or on account of the exemption of noninterest-bearing accounts. The classification is reasonable.

A state tax of a specified percent on deposits in national banks paid by the bank under agreement with the state pursuant to statute and which is otherwise valid does not amount to denial of due process of law because the depositor had no notice in advance of the assessment where, as in this case, the tax was recoverable by suit in which the depositor would have full opportunity to resist any illegal demand.

A lawful state tax on deposits in bank is imposed in the exercise of a power subject to which deposits are made, and does not impair the contract obligation of the bank to the depositors by requiring the bank to act as agent in collecting it. North Missouri R. Co. v. Maguire, 20 Wall. 46.

84 Vt. 167 affirmed.

The facts, which involve the legality of a statute of Vermont imposing a tax on deposits in national banks, are stated in the opinion. chanroblesvirtualawlibrary

Page 231 U. S. 126

ChanRobles™ LawTube

google search for Search for

Supreme Court Decisions Philippine Supreme Court DecisionsUS Supreme Court Decisions



Browse By ->> Volume


Browse By ->> Year


  Copyright © ChanRobles Publishing Company | Disclaimer | E-mail Restrictions
ChanRobles™ Virtual Law Library |™