U.S. Supreme Court
Gibbes v. Zimmerman, 290 U.S. 326 (1933)
Gibbes v. Zimmerman
Argued November 17, 1933
Decided December 4, 1933
290 U.S. 326
1. The question whether a state law violates the contract clause of the Federal Constitution cannot be considered on appeal from a state court where the appellant did not rely upon or mention that clause in his pleadings, but invoked only provisions of the state constitution respecting contract obligations, and where the state court did not discuss or mention it in disposing of the case. P. 290 U. S. 328. chanroblesvirtualawlibrary
2. Under the laws of South Carolina prior to March 9, 1933, the remedy of depositors of an insolvent bank for the enforcement of the stockholders' statutory liability was through a receiver, whose duty it was to enforce this liability for the benefit of creditors and depositors. An Act of that date granted to the Governor plenary power over all state banks, and prohibited suits against them without the Governor's consent as long as he remained in control. Under regulations promulgated pursuant to the Act, the Governor was authorized to appoint a conservator for any bank in order to conserve its assets for the benefit of depositors and creditors; conservators thus appointed were to have all the powers of receivers, and the rights of all parties were to be the same as though a receiver had been appointed. A later act empowered the Governor to order the liquidation of banks by conservators, when necessary to protect depositors and creditors, the powers and duties of conservators to this end being those of a receiver. The substantive rights under the old law were preserved. Held, the legislation, as applied to a depositor who sought the appointment of a receiver for an insolvent bank, of which a conservator was in possession, does not deprive him of property without due process of law under the Fourteenth Amendment. Pp. 290 U. S. 329, 290 U. S. 332.
3. Although a vested cause of action is property, and is protected from arbitrary interference, there is no property right, in the constitutional sense, in any particular form of remedy. All that the Fourteenth Amendment guarantees is the preservation of a substantial right to redress by some effective procedure. P. 290 U. S. 332.
4. Inasmuch as any depletion of the assets which might have resulted from the acceptance and handling of special trust deposits by the conservator was abated for the future by an order of the Governor directing liquidation, and no present advantage could accrue from the ousting of the conservator and the appointment of a receiver, the case in this aspect is moot. P. 290 U. S. 333.
171 S.C. 209, 172 S.E. 130, affirmed.
Appeal from a decision of the Supreme Court of South Carolina granting a writ of prohibition to stay a proceeding in equity for the appointment of a receiver for an insolvent bank. chanroblesvirtualawlibrary