THE FAMOUS BANK CASE 



in suddenly closing this banlv, practically with- 

 out warning, and in installing a temporary 

 receiver without the knowledge of the state 

 examiner, and in suddenly causing telegrams 

 to be sent to so-termed associated banks of 

 said bank throughout the state and deter- 

 mining that certain forms of collateral held 

 in this bank, as well as in many other banks 

 of the state, improper collateral and of doubt- 

 ful value has occasioned unprecedented public 

 concern, not only in this bank, but in banks 

 throughout the state, concerning their solv- 

 ency and concerning the operation of bank- 

 ing laws of this state and even the credit 

 of the state/' 



As to the sending of the regular examiner 

 out of the state, and the appointment of his 

 subordinate as receiver, the court said: 



''It therefore follows that the action of the 

 majority of the state baulking board was illegal 

 and unauthorized. Even though it were con- 

 ceded that the board did possess the power to 

 close the bank and appoint a receiver, never- 

 theless the action as taken by the majority of 

 the board was unreasonable, arbitrary, un- 

 just, and cannot be upheld." 



Concerning the postdated checks and the 

 general condition of the bank, the decision 

 said : 



» " There is no more reason for declaring fa rm- 

 ers' paper to be of a certam percentage of value 



315 ' 



