ARGUMENT,

IN FAVOR OF

THE CONSTITUTIONALITY

OF THE

GENERAL BANKING LAW

OF THIS STATE,

DELIVERED BEFORE THE SUPREME COURT, AT THE

JULY TERM, 1839.

BY SAMUEL A. FOOT,

Of the city of New-York, Counsellor at Law.

GENEVA:

IRA MERRELL, PRINTER, SENECA-STREET.

1839.

HG2426 N7F6

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ADVERTISEMENT.

THE history of judicial controversy, so far as my knowledge of it extends, does not furnish a case, in which such an immense amount of property and such vital interests of the community were involved, as were brought into discussion and subjected to judicial determination, by the argument of the cause of Anson Thomas, President of the Bank of Central New-York, against Samuel D. Dakin, at the last July Term of the Supreme Court of this State, held at the city of Utica. The question raised, discussed and submitted to the Court, in that cause, was, whether the Act of our Legislature, entitled, "An Act to authorize the business of banking," passed the 18th April, 1838, and commonly called the "General Banking Law," was constitutional or not. If it is not constitutional, it is of course void, and gives the banking companies, formed under it, no legal authority to conduct banking business. Every one will readily see, the immeasurable amount of unmixed evil which must flow from such a result. The contemplation of it, even, is appalling. It became my duty to take a responsible part in this grave discussion.

The tens of millions which have already been invested under this Statute, and now actively employed, and the arrangements which have been made for the investment of hundreds of millions, give the subject an unparalleled importance as regards mere amount of property. The peculiar moment too, at which the question arises, is most inauspicious for the business and commerce of the country, and the public credit of the States of our Union. The determination of the question will, moreover, have a material influence on the future legislation of this State, so far as relates to private incorpo. rations; and, it is hoped, may have a beneficial effect upon it, and check, if not entirely cure, many serious evils we now endure.

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These various aspects of the subject have created great anxiety in the public mind, as I learn, to be informed of the grounds taken in the argument, the precise questions raised and discussed, and the views taken and suggestions made by the Court.

The passing of the present month at this place gives me an opportunity, and I have concluded to write out and publish my argument, in the hope, that its publication may be of some benefit, at least, in allaying the anxiety felt to be informed of what occurred on the discussion, and perhaps, in exhibiting the firm grounds on which the rights of those rest, who have invested their property on the faith of a public statute of our state.

GENEVA, August 1, 1839.

SAMUEL A. FOOT.

STATEMENT of the case-and how the question arises, respecting the constitutionality of the General Banking Law.

Preliminary remarks.

Propositions maintained in the argument:

First. The associations authorized by the Statute and organized under it, are not corporations; and, consequently, the clause in the Constitution of this State, which restricts the power of the Legislature in creating bodies corporate, does not apply to it.

Second. But admitting that the associations are corporations; still, this Statute is constitutional; because, the restrictive clause of the Constitution does not prohibit the Legislature from passing a law, authorizing an indefinite and unlimited number of corporations; or, in other words, does not apply to a general act of incorporation; and, consequently, the Legislature may now provide, by a general law, for the incorporation of an unlimited number of voluntary associations; as it could and did, in many instances, before the adoption of the present Constitution.

Third. Admitting that the constitutional restriction does apply to a general act of incorporation; nevertheless, such an act may be passed by a two-thirds vote; and the Statute in question, having passed through the regular forms of authentication, and appearing on the statute book, must be presumed to have been passed by the requisite constitutional vote.

Supreme Court.

ANSON THOMAS, President of the Bank

of Central New-York,

vs.

SAMUEL D. DAKIN.*

THIS is an action of Assumpsit, commenced by declaration in the usual form, upon three drafts, amounting together to about five thousand dollars, drawn by Dakin, the defendant, in the