Commissioner of Banks ex rel. Farmers & Merchants Bank v. Harvey, 202 N.C. 380 (1932)

March 16, 1932 · Supreme Court of North Carolina

202 N.C. 380

COMMISSIONER OF BANKS, Ex Rel. FARMERS AND MERCHANTS BANK, v. W. B. HARVEY and His Wife, NANNIE L. HARVEY.

(Filed 16 March, 1932.).

Baiilcs and Banking H e — Action on note which is part of insolvent hank’s assets must be brought in name of the Commissioner of Banks.

An action on a note payable to a bank since becoming insolvent and placed in the hands of the Commissioner of Banks must be brought in the name of the person holding the office of Commissioner of Banks as such officer, as otherwise confusion might arise on the officer’s official bond, and where tbe action is brought in the name of the office only, the judgment of the lower court overruling tbe defendant’s demurrer will be reversed, and upon receipt of the certificate of reversal, C. S., 1417, the lower court may allow an amendment of the summons and complaint in accordance with the opinion, C. S., 515, 547.

Appeal by defendant, Nannie L. Harvey, from Devin, J., at November Term, 1931, of LeNOie.

Reversed.

This is an action on a note executed by tbe defendant, ~W. B. Harvey, and endorsed before delivery, by tbe defendant, Nannie L. Harvey. Tbe note is payable to tbe order of tbe Farmers and Merchants Bank of Kinston, N. C., and was due and payable on 19 June, 1931. No payments bave been made on said note by either of tbe defendants. There is now due thereon tbe sum of $1,250, with interest from 19 June, 1931.

On 30 April, 1931, tbe Farmers and Merchants Bank was closed by order of tbe Commissioner of Banks of North Carolina. Its assets, including tbe note sued on in this action, are now in tbe bands of a liquidating agent appointed by tbe Commissioner of Banks, under statutory authority.

This action was begun on 24 August, 1931, by the Commissioner of Banks, on tbe relation of tbe Farmers and Merchants Bank.

Tbe defendant, Nannie L. Harvey, demurred to tbe complaint on the ground that there is a defect of parties plaintiff, for that tbe Commissioner of Banks is not a party to tbe action, as appears from tbe complaint.

Tbe action was beard on tbe issue of law raised by tbe demurrer. Tbe demurrer was overruled.

From judgment overruling tbe demurrer, tbe defendant, Nannie L. Harvey, appealed to tbe Supreme Court.

Wallace & White and Assistant Attorney-General Seawell for plaintiff.

Rouse & Rouse for defendant.

CoNNOB, J.

Tbe issue of law raised by tbe demurrer to tbe complaint in this action is whether tbe action on tbe note set out in tbe complaint can be maintained in tbe name of tbe “Commissioner of Banks, Dx rel. Farmers and Merchants Bank.” It is contended by tbe defendant, Nannie L. Harvey, that on tbe facts alleged in tbe complaint, tbe action can be maintained only by tbe person now bolding tbe office of Commissioner of Banks. This contention was not sustained by tbe judge of tbe Superior Court, who overruled tbe demurrer. In this there was error. Tbe demurrer should bave been sustained.

Chapter 243, Public Laws of North Carolina, 1931, is entitled, “An act to create tbe office of Commissioner of Banks, and to provide for tbe maintenance of the Banking Department.” It is provided therein that on or before 1 April, 1931, and quadrennially thereafter, the Governor, with the advice and consent of the Senate, shall appoint a Commissioner of Banks, who shall hold his office for a term'of four years. It is further provided that the Commissioner of Banks, before entering upon the discharge of his duties, shall enter into bond, with some surety company authorized to do business in the State of North Carolina, as his surety, in the sum of not less than fifty thousand dollars, conditioned upon the faithful and honest discharge of all duties and obligations imposed upon him by statute.

Among the duties imposed by statute upon the Commissioner of Banks is that of taking possession of and liquidating insolvent banking corporations organized under the laws of this State. To that end, he is authorized by statute to take possession of all the assets of an insolvent banking corporation, and to collect the same, by suit or otherwise. Actions to collect notes which pass into his possession as assets of the corporation, must be brought by him, as Commissioner of Banks. Otherwise some question might arise as to the liability of the Commissioner of Banks under his official bond, for his defaults, if any, in the liquidation of an insolvent banking corporation.

The judgment is reversed. Upon the certification of this decision to the Superior Court of Lenoir County (C. S., 1417) the summons and complaint may be 'amended in accordance with this opinion. C. S., 515 and C. S., 547.

Reversed.