Vincennes Gazette, Volume 3, Number 41, Vincennes, Knox County, 15 March 1834 — Page 1

til 11 iiJJllo

vurciiawizs, ijt&ijijy march 15, 1834. JWTMBER 41

TIIK But is the practice illegal! It i believed VINC2NN2S GAZQTT2, lotie not at all ungual. It i believed to be

Published fieri Saturday

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Mr. Vfb!-ter made the following: KCI'OIIT OF TIIK O.jIJUTTUE OX i'lXAM'i:. coNCl.unED A? the time of f'ip expiration of tbo charter of the burner bank, Mr G illa'in was Secretary of the Trea-utv, and the deposites fie in the bank. The charier cf the bank w a to en 1 on the -1th M .irvh. 1311. an i tl doe not appear that Mi G -.libit in thought it neceur to make ao provision whatever for removing; any part of the deposites, except b drawing on them for the rotrmon ue of government, until lute m the prv n -nih preceding the expiration ol the charter. A l uge amount of those d-posites remained, indeed, in the vault of the bank after it clnrtei had spire. I, ami until they were wanted, in the general operation of the

Treasury And why should it be other wise? Why hould that be done suddenly now, which the Secretary think could not be done suddenlv hereafter, without great inconvenience? it not the jut infererce, from bis own argument, that the tin should not have been done suddenly at all? A to the idea that the credit of the paper of the bank will be depreciated, near the time of the expiration of it 3 charter, or that it would be inconvenient for it, at that time, to be called on for the deposites, the committee are

title i ly at a lo-s to see the Miyh'est toun thin"

ttation lor such an opinion Lxoenence is against i:; and all reason, a the 0mmittee think, is against it alo There is nothing to reader it in an degree, doubtful, that the bill of the bank will be in as good credit, the last day of its charter, and even after that time, if any shall be outstanding, as they are now; an ! there is a little to render it doubtful, that then, a now, the hanli u! I be competent to an swet all demind upon it In the opinion of the commite, the withdrawal of the fund w i t..ih uooees-iMrilv early, and Unnecessarily, -u Men. It might have been, and ought to have, hern, a the committee think, not ventured upon at all, until the attention of Congress itself had been called to the subject. The com mittee therefore entirely di-ent from this firt reason, reported by tbe Secretary They see nothing which proves to them the existence of the slightest occasion lor

taking this important step, at the moment j it was taken. So far a it depend on this reason, the committee think the removal was made without necessity, without cau tion or preparation, with a suddenness naturally producing mischievous consequences, and in unjustifiable anticipation of the legislation of Congiess But the Secretary thinks there are other reasons for he removal, growing out of the manner in which the affairs ot the bank have been man iged, and its money applied which wouid have made it his duty to withdraw the deposites at any period of the charter. Of these readme, thus arising from the alleged misconduct of the bank, the first

is, that many important money trans tc-tion-of the bank are id fed under the control ot a committee of Exrhange, ot which committee, no one of the public dneclois, as they are called, i allowed to be a member, instead of being transacted by n baid of seven directois. This chat ge consists of two pails; fust, that the discounts ot bills aie made by ' a committee, and not by a quorum of the board ; second, that the public di

rectors are not allowed to be ol this committee. First. It is not alleged that in the discounts of bills by this coimniitee, any indiscretion has been committed, or my loss incurred; or that, iu conequeu e thereof, any facility to the mercantile com munitv has been withheld, or any duty of the bank to the Government violated. The objection i, simply , that bill are discounted by a committee. Supposing

this to be an irregularity,, or illegality, in the proceedings ol the board, bow is it to be corrected by withdrawing the deposites? What connexion is there be twe.eo the two things? It is not pretend ed that this mode ot discounting bill endangered the deposites: it is not pretended that it made the bank either les aide, or less willing, to perform every one of i s duties to Government. How should the withdrawal of the deposites then be suggested by the discovery of 6'ich an irregulanty, real or supposed? The committee are not able to perceive the 'east pro pritty in applying the. powerof removal to a proceeding of this kind, even it u were admitted to be irregular cr illegal.

quite common, in banks of large business, tor bill9 ot exchange, which are presented every day, and almost every hour in the day . to be discounted either by a committe of the directors, or by the president, or even other officers, acting under such general orders and instructions as the directors, at their stated meetings, prescribe. A large board of directors can not assemble every day, perhaps not ottener than twice a week. It bills of exrhange could only be discounted at these periodical meetings, the business of exchange could not go on with the promptitude and despatch so important to commercial men in such transaction. The committee suppose the truth these remarks will be at once admitted bv all who have knowledge of business ol this

kind . The general management and control, the au'bority of examining and supervising, of contracting n enlarging the anvunt ot dailv discount, according to the st ite of the hank, and giving every other order and direction on the subject, still remain with the dire' tors, ano i's enn stantl exeici-ed b them. They still manage the affairs of the bank, in the language of the charter, although they may depute t a committee the authority ol inquiiing and deciding upon the credit of persi n v hoe names are on bill of ex change i iTeieo for di-count, and on the rate -f ex'hat'ge, current nt the day The Ugiil que-tion would be, whether the directors, by rule or by law, may not authorize a small number of their own

board to discount hills. The bank has been advised that it might rightfully do this; and if it be not clear that this opin. ion is right, it is certainly far from clear that it is wrong; and iu this state of the

question, the general practice of other banks, under similar provisions in their charters, may well relieve the directors from the imputation of intential misman agement. If, in all this, the bank has violated its charter, what other bank9 of exten-

mating, in the remotest manner, that the live directors appointed by the President and Senate have any particular duty , or are the objects of any peculiar trust The charter calls them not Government directors, not public directors, but simply the directors appointed by the President and Senate. They are placed in the direction to consult with the other directors for the common good of the batik, and to act with these others, and vote with them o.i all questions. They are, what the law calls them, directors ot the bank, not a gents of the Government. They are joint trustee with others in n j Tint interest If an thing illegal or improper takes place in tbe board, ihey are bound to resist it bv tbe duty which they owe the individual stockholder, a much as by tbe duty thv owe the Government ; because (hey are agent of the individual stock

holders, st'.d have tbe same authority to bind the Government : and, in like manor r, it is tbe duly of thoe directors who ire

appointed by the individual stockholders, to give notice, :ls; vte m Government as to the sfoi kholders, if any thing illegal Like place, or be thieatened All those directors act and vote together on the smallest as well as on the highest occasions; and. bv their joint votes, bind the corporation, and bind both the Government and individual stockholders to the extent of their respective interests in the corporation. If the directors appointed by (he President and Senate had been excluded by the charter fiom any part of the power exercised by the others; if it had heen forbidden them to interfere, to the same effect. a the rest in the common business of the bank, there might be some reason for supposing that an uncommon charar-ter--a character not so much of action as of supervision and inspection, w as inteni ed to be conferred on them. But they do interfere, ami justlv, in all transactions of the bank. They do vote and act on all

subjects like the other directors.

to the account of the Treasurer in the such a question, should furnish any reason bank I whatever for withdrawing the deposites,

unless it be. ot once admitted that the Secretary holds the power of removal as a perfectly arbitrary power, and may exercise it bv way of punishment, whenever, in any particular, the conduct or the opinions of the bank do not conform to hia pleasure.

The Secretary does not argue this matIter He offers no reason in opposition to

On presentment of this bill at the French Treasury payment was refused; the bill was accordingly duly protested, and it was taken up by a third person for account of the bank. The damages accruing on this bill, according to law and to constant us;ige in such cases, are one hundred aud fifty eight thousand dollars.

If this bill had been transferred by the (the legal right of the bank to the damages

bank, as probably it was, the bank ilselfjelaimed Indeed, he hardly denies the would have leen answerable for damage j right . He commences his observations pven at a higher rate, if a third personon the subject by saying, tha the ruling bad not taken up the bill for the honor of i principle ot the bank is its own interest; 'be bank land clo-es them with another declaration, On reren ing information of the protest i that, as fi-cal agent of the public, it avaiSof the bill, the officers of the bank, a9 was jed itself of the disappointment of its prin-

theirdut v, gave immediate notice to the ' cipal for the purpose of enlarging its own

Treasury Department, and accompanied

that notice with the information, always

profits

Assertions like these, however else they

made in su' h cases, that the drawers of ' m?.y he disposed of, cannot be made sub-

the bill would be held answerable for the ' ieclf of argument

damages Such is the substance of the i The last charr-e preferred norainst the

facts in this case.

bank, is, that it has ued its means with a

The bank, it would appear, was willing view to obtain political power, and there

to collect the bill on account of Govern

ment, and to credit tbe Treasury with the proceeds when received, a course of pro eeedings, which had this to recommend it.

that the money to be received on the bill, vva to be received by the government simply in tiust for claimants under the

by secure the renewal of its charter.

The very statement of such a charge, as a reason for removing the deposites, is calculated to excite distrust in the wisdom and propriety of that measure; because the charge, too general to be proved, is

too general also to be disproved ; and since

French Treaty, and was not ultimately I it must always rest mainly on mere opio

destined to the ordinary uses of the Trea-,ion, it might be made at any time by any sury. On the contrary, indeed before I Secretary asainet anv bank It would

mnrv

lc in",

then, posessed of this common character

of directors, and enjoy ing all its powers to the fullest extent, the committee know

-ive business have not done the same j no form of argument by which an uncom

mon and extraordiary character is to

But the other subject of complaint, and be raised by construction, and super

that which seems to be regarded as the ! added to the common character ofideed, the agency of the bank had been

moreoflensive part of this regulation , is directors which thus already belongs to 'declined, the Secretary preferring to (ieal

the dishonor of the bill w as known, it had

been made, air early, the legal duty of the Secretary to place the fund, as soon as received, at interest for the benefit of the claimants Put it was thought best to sell the bill, and to realize at once its amount into the Treasury; and the bill was sold to the bank, in prefeience to others offering to purchase, for no reason, it is to be presumed, except that the teims of the bank were more satisfactory The bill was thus purchased of the bank, and its proceeds credited to the Treasury. This was a mere transaction of the purchase and sale of a bill of exchange . There was no trust confided to the bank, and no fiscal agency in the whole matter. ln-

that the public directors, as they are call

ed, were not allowed so be on 'hi committee.

them. with it not as assent, but as a purchaser

By granting the charter, and by accep ; proposing to it not to collect the bill, but ting it, the Government on the one hand, (to buy it On being remitted to Europe.

It may be observed, in the fiist place,1 and the individual stockholders en theiand presented for payment, the bill wa-

that if the discounting of bills ot exch r:ge other, have agreed , that of the directors, protested. Pv the universal commercial by acommiftee, instead of the w bole hoard as joint agents of all parties, ihe stockhol law, th- Government, on the nrrurr nee of director be illegal, it would hardly be j rlei s shall appoint twenty, and tbe Govern- of Ibis protest, became amenable to the rendered legal by placing any or all of i ment five. The interest of all pai tie is , bank for the amount of the bill, w ith dam tbe-e public "irectors on the committee as confided to this joint agencv ; and any dis-; iges These damages may be ultimately members But the Secretary seem to j miction in their powers, ari-ing from their claimed, with justice, from the French suppose that there was some particular different modes of appointment , is. in the Government, it the bill was drawn upon object in t hi exrluion of these ilnector, judgment of the committee, not to tie sus-' sufficient grounds, and on proper audio as if there had been something wrong to rained They regard such di-linction as rby ; in other words, if the obligation ol be done, and therefore senets to be kept entirely inconsistent w ilb the nature of the the Fienr.h Government was such that it by this committee. It i- not easy to see agency created and as deriving not the; was bound to accept and pay the bill; but

what foundation there can t e for this opin least countenance from any thing vootained unless there be something in the case to

ion All those discounts are matter, ot , in the law vary the general rule , w hich the commit

record They appear every day in the, The committee, nevertheless , to avoid tee do not perceive, these damages were books of the bank Every director, on mis apprehension, w ish to repeat, that it is part of the debt which had become due or off thp committee, sees them, or may undoubtedly the duiy of the director ap- to the bank, a much as the principal -urn see them, at pleasure. There isuo sccre pointed bv the Piesident. and ; f all odier . of the bill If this be so, how could the

cy , nor any motive for secrecy . so tar as directors, o give notice, bom v G overs.- dneciors relinquish this part of the debt this committee can perceive Very pro- ment and the stockholders, of any viola-iany more than the other They are per causes may have exi-'ed, fr might tion of the charter committed or threaten-1 agents for the corporation; they act as

that cau be known by the bn!e tor meied. uu-iees, and nave no authority, wimoui

omission of these particular directors' The Secretary of the Treasury has consideration, f0 release, either to the from this particular committee. Their j thought proper to observe that the m as Government or to individuals, debts due, -ervice miht have been deened more ures of the committee of exchange are, ' or proper ly belonging to the corporation.

useful in other committees; or however! as it appears, designedly, and by system, j It has been suggested that the bank

so arranged as to conceal from the officers j should have taken up Hie bill, when pro

of the Government transactions in which tested, on Government account Two an-

respectable in gener al character, or bowever useful in other parts of the direc

tion, thev may have been esteemed not so ; the public are deeply involved. This, irswer may be given to this suggestion:

well acquainted as others with the business of toseign or domestic exchange.

And even if there were, or are, other cau

must be admitted, is a very serious charge, the fiist is, that the bill had been taken

therefore be always a convenient cloak under which to disguise the true motives of official conduct. If proof be made out that the funds of the bank have been applied to illegal objects, the proper mode of redress an i pun ishment should have been adopted ; but what has thi to do with the dep"-ite8?

A in the case of the French bill, the Secretary cannot jusiifv the removal of the deposites on any such ground as b', uo less it be conceded that he may iw the power of removal as a punishm-nt I r any offence of any kind which the bank, in his opinion, may have committed The com mittee have already expressed the opinion that no such latitude of power belongs to him, and the assertion of such a power, for such a cau-e as is now under consideration, shows that tbe power ought never to belong to any Secretary : because the offence, on account of which it is here proposed to be exercised, is a political of

fence, incapable of definition, depending merely on the Secretary's opinion, and necessarily drawing into its consideration all the exriting controverted topics of the day. The bank, it is said, "has sought 'o obtain political power " What is the definition of uch an offence as this? What acts constitute it? How is it to be tried? Who is to be the judge? What punishment shall follow conviction? All must see that charges of this nature are but b oe and vague accusations which may be made at any time, and can never bo either proved or disproved; and to admit them a sufficient grounds to justify the removal of the deposites, would be to concede to the Secretary the possession of a power purely arbitrary. The main fact relied on for this cause of removal shows how extremely unsafe all proceeding on any such reasons must be. The main fact i, that, between De cember. 1830. and December, 1831, the bank extended its loans twenty millions of dollars; and it is further alleged, that, as if to leave no doubt of the motive of thi extraordinary conduct, it continued to dd ranidly to its loans, until, in May, 1832, while its petition for renewal was pending, those loans amounted to seventy

millions And the Secretary declares that this extraordinary increase of loans

It imputes a corrupt motive. The com-, up by a correspondent abroad for account mittee have sought for the foundation, ei of the bank, before it was known in the

se for the omi-sion, such a tend less tother in evidence or argument, on which j United States that it had been protested .1 made in so short a space of time, and on

orove the existence ol t bat harmony and this charge rests. Thev have tounti nei-i I he seconil is, mat u wouio nave ueen the eve or a conie.-ieueiev.uuii m wu,u

mutual respect which it is so desirable j ther. They find only the charge, in the ( unlawful for the bank to have advanced -b.-uld prevail in such a board, these! first place; and then they find thesu'.h amount 'o the Government, or on rtiip '-annot furnish ani iust ground for 1 charge immediatelv stated as a fact, ; account of the Government , for the pur

asserting, either that the business of ex- and relied on as the basis of other char-lpose of taking up this bill, or for any country, to induce them, by the appre

change was illegally conducted, or that'ges ! other purpose, without an act ot Congress. ; hension of ruin, to vote against the can-

the constitution ol the committee was; The second reaenn neciallv lenorted by tie exPress vvorls Ul ICI ,u,u,u aiuaie 11

c . ' " .i i , ' i f i stron assertion, but, so far as the comthe Secretary as arising Horn the conduct, r V ' BMfiPfinn mprp!v

But as a reason for removing the depo ,!"- r--" , . "." J'

It IS I'Ul Ulc ceciciai v a unu imcicutt;

proof of the existence ot any motive not fit to be avowed. . But the Secretary entertains an opinion respecting the character and duties of the directors appointed by the President and Seriate, in which the committee do not concur. He denominates them ,4publie directors,' '"officers of the Government,1' Lc By the charter of the bank there are to be twenty-five directors. Of these twenty are to be chosen by the individual -tockhoblers, and are appointed by the

President, with the advice and consent of

the Senate. As the Government owned one titlh of the stoc.k of the bank, it was

judged expedient to place in the hands ot

the President and Senate tbe appointment

of one tilth of all the directors. But they

are not called public directors, nor officers

of4he Government, nor public agents; nor are thv entitled, so tar as the com

mittee can perceive, to either of these ap

pell tinns, any more than the other dirertors. The whole twenty-live directors are ioint manaerer of a joint fund, each

p.. .testing precisely the same powers, and

charged with the same duties as every

other They derive iheir appointments

it i true, fiom diffeent origin, but. when

appointed, their authority m 'he same. -There is uot one word in tbe charier inli

the bank took an open and direct interest demonstrates that it was using its money

to obtain a hold upon the people of the

of the bank, respects the bill of exchange

A ...... n I... I I. C . IU.-. 'I'lOitlllll l.il.. .,rr.n.,r In i Vl u fn m m I t 1 1 P fltlltP

... iim A cv ...,r. ; ' i,,.ir ihP hank be r.rrhr or from facts, from which very facts his pre-

chased by the bank Iwrong in claiming the-e damages Ifecessors ,u office have drawn no fcuch

The general tacts connected with this ronkr, it will not recover them It r not . .

case, are these: M judge of .ts own rights; and ,t the ap- ; . V" :" , ' utk

By the late treaty of indemnity between propriate tribunal-shall decide that the ; m - j

iU I1..1...IC,.. i r .,la n. l1..J.,tori;nn.nnlhjn(P!iSI(in nrnilfrht was II w.p.a.ucu M I

i lie n I ICO Otaiesauo r I iiutc, u j nam nao n. uug w vwi.' . -g,

ulated that the French Gov ernment should

pay to that of the U. S twenty five mi

ij . u. 1 i :i r

mhP.rtPrl.hPPnt of Government. s,10U,a 11 ,i:iVK uie vigmmceui

or tht it was it duty to take up the;" Secretary at that day, at the lime it

account ot Government, then the i l11" 1 u, n,.uu i....

I i n rk Q rf 4 r n n. 4 ,v io t r i fill toil fk ft 1 1 1 f l (Jr Kill on

iio'a li auu?. IJ UC uiomuuvv-u uu.-.ffc imii wti ifcvv'-v t - , ,. - a i fiirfil'iiirn if h ii jiiil lia nrt t non r o rr r t O

those American citizens who had claim damages will not be awarded to it. Arui ( - against France for the unlawful seizure. ! in the worst aspect of the case, how can deposites? So also, as to . the amount

D . . . .. iJ . a ... .1.- i u n, nncihu ot loans in M w. I hat amounz

capture, anu condemnation oi tneir vessels

aud property; the whole sum to be paid

in annual instalments of tour millions ooe hundred and sixty six thousand six bun dred and sixty six francs each, into the

handsofsuch person as shall be authorized by the Government of the United States to receive it the first instalment to be paid at the expiration of one year next following the exchange of the ratification. On the expiration of the year, the Secretary drew a bill of exchange, signed by himself as Secretary , on the French Government lor the amount of this instal-

the worst aspect of the case, how can ;the deposites? So also, as to . the :ui of loan in Ma v. 1 That

iijrnm nrt in una irsoeri. ne anv iiossiuie v

reason to justify the removal of the de perleclly well known at the time, posites? What' connexion has this occur Pved any otfence, why was not rence with the safe keeping of the public e punishment inflicted then? How should treasures, or with the remitting them from all other Secretaries have slept over line place to place, to meet the convenience greit mischief? of the Government, according to the duty j It might further be well risked, what of the bank under the charter? The bank evidence is there of the existence ot any thinks itself entitled to damages on a pro- such motive as is imputed to the bunk iu tested bill, purchased and held by itself, this extension of its loans? There is no and drawn by Government. The Secre- evidence but the mere fact itself of the tary of the Treasury thiuks otherwise If extension, and it cannot be denied that there be no reason to doubt the sincerity other and very different reasons for the of the Secretary's conviction, there is as extensions may have existed ; so that the little to doubt the sincerity of that enter- charge is proved no otherwise than by in-

tneut and sold it to the bank, like any tained by the bank; and it i9 quite incon- ferring a oad motive from an act law tin other bill of exchauge, and received , cetvablc to the committee that the pen in itself, and for which good reas-ms may the proceeds by credit of the amount! dency of such a difference of opinion, onihafo exitedj nor is it either acknawlcdg'