Clark v. Flynn

McNally, J.

(dissenting). I dissent and vote for the dismissal of the petition.

On this application for an order in the nature of prohibition under article 78 of the Civil Practice Act, the question presented is the scope- of subdivision 10 of section 36 of the Banking Law, which provides as follows: 1 ‘ All reports of examinations and investigations, including any duly authenticated copy or copies thereof in the possession of any banking organization, foreign banking corporation, licensed lender, licensed casher of checks, or the savings and loan bank of the state of New York, shall be confidential communications, shall not be subject to subpoena and shall not be made public unless, in the judgment of the superintendent, the ends of justice and the public advantage will be subserved by the publication thereof, in which event he may publish a copy of any such report or any part thereof in such manner as he may deem proper. ’ ’

An action is pending in the Supreme Court, New York County, by John J. Reynolds and John P. McG-rath, plaintiffs, against Judith Snów and Ellen Schwamm as administrators of the estate of Lillian Ruth Schwamm, deceased, and of the estate of Harvey L. Schwamm, deceased, and American Trust Company, to establish a trust in regard to certain shares of stock of American Trust Company.

On October 19, 1954 the then special deputy of the Banking Department of the State of New York addressed a communication to American Trust Company containing certain observations and recommendations in the light of conditions existing at the close of its business on June 18, 1954. The said communication states, in part: “A copy of the report of examination of your institution as of the close of business June 18, 1954, is being sent with this letter.” Its closing paragraph characterizes the communication as follows: “This is an official communication within the meaning of Section 11, subdivision 4 of the Banking Law.”

It appears that the plaintiffs in said action propose to introduce in evidence the said letter of October 19, 1954 or its contents. The materiality and relevancy of the said letter and the facts therein are not in issue and on this application must be assumed.

On November 5, 1959 an oral application was- made before the Trial Justice in said action in behalf of the petitioner herein for the exclusion of the letter of October 19, 1954 on the ground that it is a confidential communication within the meaning and intent of subdivision 10 of section 36 of the Banking Law, and on the further ground that the consent to publication thereof *254was not obtained from the Superintendent of Banks as thereby required.

The extraordinary writ of prohibition may issue to restrain a lower court acting without or in excess of its powers. (Matter of Culver Contr. Corp. v. Humphrey, 268 N. Y. 26; Matter of Hogan v. Court of General Sessions, 296 N. Y. 1.) However, the extraordinary remedy should be reserved “for really extraordinary causes ”. (Matter of Fahey, 332 U. S. 258, 260.) Here it appears that the communication sought to be excluded has, in fact, been published; that it was annexed as an exhibit to the complaint and filed in a prior action by the plaintiffs herein grounded on the very agreement which is the basis of the pending action, and that its contents are a matter of common knowledge in the banking community. How the nebulous additional publicity incident to the introduction of the communication in evidence on the trial of the pending case will adversely affect the public does not appear; that the ends of justice will not be subserved by its exclusion is evident.

We are concerned with a statute which makes confidential reports of examinations and investigations and excludes them from the scope of subpoena. The nonjudicial power of the Superintendent of Banks to make unavailable in a judicial proceeding relevant and material evidence should not be implied. Subdivision 4 of section 11 of the Banking Law defines an official communication and states the effect thereof; it does not provide that such a communication shall not be subject to subpoena. On the other hand, in respect of reports of examinations and investigations and duly authenticated copy or copies thereof, subdivision 10 of section 36 of the Banking Law provides they shall be confidential communications and shall not be subject to subpoena.

It is quite clear that the letter of October 19, 1954 is not a ‘ ‘ report of examination ’ ’ because it expressly recites that such a report accompanies the said letter. Moreover, the closing paragraph thereof aptly describes the said letter as “ an official communication ”. If it was the purpose and intent of the Banking Department to make confidential and not to subject to subpoena the comments and observations contained in said letter, he would have set them out in the report of examination, thereby bringing them within the scope of subdivision 10. We may not enlarge by implication and under the guise of statutory interpretation the confidential communications or the immunity against subpoena which the Legislature saw fit to limit and confine to reports of examinations and investigations.

*255The jurisdiction to issue the writ here sought is no doubt present. It should, however, be reserved for extraordinary causes. (Bank Line v. United States, 163 F. 2d 133.) Apart from establishing and vindicating the bare statutory power of the petitioner, no public interest is subserved, and the ends of justice may be defeated by the granting of this application.

Breitel J. P., Rabin and M. M. Frank, JJ., concur with Valente, J.; McNally, J., dissents in opinion.

Application for a writ of prohibition granted, without costs.

Settle order.