Hamilton County v. Aurora National Bank

Barnes, J.,

dissenting.

I am unable to concur in the majority opinion, and briefly state some of the reasons for my dissent. In construing statutes the court should take account of the conditions existing prior to their enactment, the mischief sought to be prevented thereby, and the means adopted to accomplish that purpose. To that end courts are required to make use of the knowledge common to all persons of such existing conditions. It is a well-known fact that for many years prior to the enactment of our depository law, in its original form, it had been the universal custom of our state and county treasurers to deposit the public moneys in such banks as would pay them the highest rate of interest thereon, to convert this interest to their own use, and thus increase their salaries and fees beyond the compensation allowed them by law. This practice had, in many instances, resulted in loss of the public funds, and many unsuccessful suits liad been instituted to recover the interest thus converted to the use of such officers. It therefore seems clear that the legislative purpose in passing the depository act of 1901 was to provide a safe place for keeping the public money, to obtain interest thereon to the use and benefit of the public, and prevent the appropriation of such interest by the public officers. The effect of the original act was to immediately put a stop to the payment of interest to treasurers on public funds deposited in banks, and interest at the rate of 2 per cent, per annum was thereafter paid to the counties by depository banks. In' the course of time it was ascertained, and it became a well-known fact, that many banks were practically annulling the provisions of the depository law by assisting in the election of county treasurers who were friendly to them, and by *290then refusing to qualify as county depositories, under the provisions of that act, they were obtaining the use of public money without the payment of any interest whatsoever. When this course had been pursued to such an extent that it also became a matter of common knowledge, the legislature amended the depository law by the act of 1903, and inserted therein the clause that, on all deposits the treasurer may make in any bank whatsoever, interest shall be jpaid at the rate of 2 per cent, per annum. Construing the amendment in the light of the conditions above mentioned, which were then well known and understood, and which the courts should not refuse to recognize, we are of opinion that it was the intention of the legislature to make the amended act apply to transactions like those in the case at bar, and thus prevent the banks by the adoption of any scheme or device, and irrespective of any condition whatsoever, from obtaining the use of the public money without the payment of interest thereon. It will not do to say that the amendment in question was intended to apply alone to depository banks, for that matter was fully covered by the terms of the original act. It is conceded by the majority opinion that the officers of the defendant bank well knew that treasurer Cunningham was, as a matter of fact, by the purchase of the certificates in question, depositing the county money in their bank for safe-keeping. It is said that the bank had no use for this money, and obtained no benefit from such deposits. With this I cannot agree. The testimony discloses that the bank did not néed the money for the purpose of extending its loans, and that is as far as the evidence goes. It must be conceded, however, that the deposit of this money, amounting at times to as much as $30,000, did benefit the bank. It swelled the amount of its available assets; it enabled it to increase the amount of its banking business; and was a benefit to its financial standing. It follows that it is no hardship for the bank to be required to pay interest at the rate of 2 per cent, per annum on the average daily balances of the funds so deposited *291therein from and after April 3, 1903, at which time the amendment in question became operative. It may be suggested that the amendment of 1909 repealed the section of the depository law in which the clause in question is found. I am satisfied, however, after an examination of this matter, that the intention of the legislature was not to repeal that section, but to repeal another and different section of the depository law, and, where such intention is clear, it is the settled law of this state that the repeal will operate only upon the section which was intended to be repealed. We think, however, the suggestion is wholly immaterial, because if, as contended, the section containing *the clause in question was repealed, such repeal did not destroy the causes of action which had accrued thereunder prior to the adoption of the amendment of 1909. Section 6971, Ann. St. 1909, provides: “Whenever a statute shall be repealed, such repeal shall in no manner affect pending actions founded thereon, nor causes of action not in suit that accrued prior to any such repeal, except as may be provided in such repealing statute.” It seems to me that the majority opinion in effect nullifies the provisions of the depository law, and, if carried to its legitimate conclusion, will permit the continuance of those reprehensible practices which it was especially enacted to prevent.

I am of opinion that the defendant bank should be held liable for the payment of 2 per cent, annual interest on the daily balances of the public money of Hamilton county deposited therein from and after the adoption of the amendment of 1903; that the judgment of the district court should be reversed and the cause remanded to that court, with directions to take an account of the amount of interest thus due from the bank to the county and render a judgment accordingly.

Root, J., concurs in this dissenting opinion.