U.S. Supreme Court
Planters' Bank v. Sharp, 47 U.S. 6 How. 301 301 (1848)
Planters' Bank v. Sharp
47 U.S. (6 How.) 301
Where a bank was chartered with power to
"have, possess, receive, retain, and enjoy to themselves and their successors, lands, rents, tenements, hereditaments, goods, chattels, and effects of what kind soever, nature, and quality, and the same to grant, demise, alien, or dispose of for the good of the bank,"
and also "to receive money on deposit and pay away the same free of expense, discount bills of exchange and notes, and to make loans," &c., and, in the course of business under this charter, the bank discounted and held promissory notes, and then the legislature of the state passed a law declaring that
"It shall not be lawful for any bank in the state to transfer by endorsement or otherwise any note, bill, receivable, or other evidence of debt, and if it shall appear in evidence, upon the trial of any action upon any such note, bill receivable, or other evidence of debt that the same was transferred, the same shall abate upon the plea of the defendant,"
this statute conflicts with the Constitution of the United States, and is void.
These were kindred cases, and were argued together. Although the Court pronounced an opinion in each case separately, yet the dissenting opinion of MR. JUSTICE DANIEL treats them as they were argued, and hence it becomes necessary to blend the two cases together. The facts in each case will be stated, then the arguments of counsel, and then the opinions of the Court, with the separate opinion of MR. JUSTICE McLEAN and the dissenting one of MR. JUSTICE DANIEL.
PLANTERS' BANK v. SHARP
On 10 February, 1830, the Legislature of Mississippi chanroblesvirtualawlibrary
passed "An act to establish a Planters' Bank in the State of Mississippi."
The sixth section of the charter enacts, among other things, that the bank
"shall be capable and able in law to have, possess, receive, retain, and enjoy to themselves and their successors, lands, rents, tenements, hereditaments, goods, chattels, and effects, of what kind soever, nature, and quality, not exceeding in the whole six millions of dollars, including the capital stock of said bank, and the same to grant, demise, alien, or dispose of for the good of said bank."
The seventeenth section gives power
"to receive money on deposit and pay away the same free of expense, discount bills of exchange and notes, with two or more good and sufficient names thereon, or secured by a deposit of bank or other public stock, and to make loans to citizens of the states in the nature of discount on real property, secured by mortgage,"
The twenty-second section enacted, "that it shall not be lawful for said bank to discount any note or notes which shall not be made payable and negotiable at said bank."
By a supplement to the charter passed in 1831 and accepted by the bank, it was provided that "such promissory notes shall be made payable and negotiable on their face at some bank or branch bank."
On 24 May, 1839, Sharp, Engelhard, and Bridges gave their promissory note to the Planters' Bank for one thousand dollars, due twelve months after date. A copy of the note is not to be found in the record, but the declaration states it to have been "payable and negotiable at the office of the Planters' Bank of the State of Mississippi, at Monticello."
On 21 February, 1840, the Legislature of Mississippi passed "An act requiring the several banks of the state to pay specie, and for other purposes," the seventh section of which was as follows:
"It shall not be lawful for any bank in this state to transfer, by endorsement or otherwise, any note, bill receivable, or other evidence of debt, and if it shall appear in evidence, upon the trial of any action upon any such note, bill receivable, or other evidence of debt that the same was transferred, the same shall abate upon the plea of the defendant."
In October, 1841, the Planters' Bank brought a suit upon the note in the Circuit Court of Lawrence County (state court). The defendants pleaded the general issue and a jury was sworn. The declaration and note having been read, the defendants filed the following plea:
"And now at this day -- that is to say on the second day of the term aforesaid, until which day this cause was last continued -- come the said plaintiffs by attorney and the said defendants
by attorney, and the said defendants say that since the last continuance of this cause -- that is to say since the sixth day of the May term, 1842, of this Court, from which day this cause was last continued, and before this day, that is to say, on 10 June in the year 1842, at the county aforesaid -- the said plaintiffs then and there being the owners of the said note sued on in this cause and then and there being a bank within the State of Mississippi, and within the intent and meaning of the statute of this state, entitled, 'An act requiring the several banks in this state to pay specie, and for other purposes,' transferred the aforesaid note to the United States Bank of Pennsylvania contrary to the statute in such cases made and provided, and this the said defendants are ready to verify; wherefore they pray judgment if the said plaintiffs ought further to be answered in this said action, and that the same may abate."
"Personally appeared in open court Thomas L. Sharp, one of the defendants in the above-stated case, who, being duly sworn, upon his oath says, that the matters and things set forth in the above plea are true in substance and fact. Sworn to and subscribed in open court."
"THOMAS L. SHARP"
The plaintiffs demurred to this plea upon the following grounds:
1st. Because said plea is not assigned by counsel.
2d. Because said plea does not state the day, year, time, and place of the transfer of said note.
3d. Because the plaintiffs have a right by law to deal in promissory notes, bills of exchange &c., secured by charter.
4th. Because the statute, the title of which is recited in said plea, is, so far as relates to transfers of notes, bills receivable, or other evidence of debt, unconstitutional.
5th. The said plea does not state to what term said cause was continued.
6th. That said plea does not allege that said note was transferred for value received.
7th. That said plea is a plea in bar of this action, but does not conclude in manner and form as provided by law.
8th. That said plea was not presented until issue joined under the plea of nonassumpsit, and the declaration and note read, and a jury empanelled to try said issue.
9th. That the statute referred to in said plea does not affect the plaintiffs.
10th. That the said defendants did not tender the costs of suit in said case, up to the time of their tendering said plea, with said plea. chanroblesvirtualawlibrary
11th. That said plea is not entitled in this cause.
12 47 U. S. 304
11th. That said plea is not entitled in this cause.