An Old Harvard Law Note

For some reason, my blogger dashboard is rendered in Chinese characters. Very odd.

Anyhow, I'm at UCLA right now, which means I can access this 1934 Harvard law note on the priority of state deposits in bank insolvencies. Good beans for me! (Harvard Law Review, Vol. 47, No. 5 (Mar., 1934), pp. 841-846.)

So, to summarize. At the time of the note's writing there was an active clash of principles among various state divisions about the right of a state to "jump to the head of line" in recovering assets against insolvent banks. To the extent the right was recognized, it was seen as an explicit inheritance by the state of the prerogatives of the King under the common law. As the author states, a reviewer of the case law "is apt to find a learned discussion of the English common law prior to the reign of James I." The article claims that analysis hinges upon a tricky distinction between the "incidental" and "political" rights of the King, and the cases uphoding the right seem to rest their logic on the conclusion that the right attaches to the political character of kingship (thus strengthening my contention that incidental prerogatives have not been seen as devolving by right to the state in the American legal tradition). Thus, it's worth exploring how courts so finding consider the import of an opposite ruling... what would it mean for an American republican government if the right were merely "incidental?" Do they take it for granted that it would then be impossible to uphold as a privilege of the state?

The trend away from recognizing the prerogative as one inherent in states is broadly informative, and probably bears a logical connection to the in rem exception to Article I sovereign immunity that's developed in the notes of the Hart & Wechsler supplement. But the action I'm most interested in really takes place in the note's feet.

Footnote 5:

Coke on Littleton: "... the king by his prerogative is to be preferred in payment of his duty or debt by his debtor before any subject, although the king's debt or duty be later; and the reason herof is that thesaurus regis est fundamentum belli, et firmamentum pacis." Co. Litt *131(b)

Footnote 7 is also relevant for bibliographic purposes.

The courts generally point out that although the right arose from the royal prerogative, it was not a prerogative incident to the person of the king, but rather one attaching to him in his political character as head of the state. See In the Matter of the Carnegie Trust Co., 206 N.Y. 390, 397, 99 N.E. 1096, 1099 (1912); United States Fid. & Guar. Co. v. Bramwell, 108 Ore. 261, 268-269, 217 Pac. 332 335 (1923)

According to Footnote 10, cases rejecting the right cite to Kent's Commentaries: I Kent's Comm. *247, 248.

Footnote 8 lists cases which have recognized the prerogative (since this is a matter of state law, there is very little federal precedent on these points):

Among the more recent cases recognizing the prerogative are: People v. Dime Sav. Bank, 350 Ill. 503, 183 N.E. 604 (1932); Ghingher v. Pearson, 168 Atl. 105 (Md. 1933); American Surety Col. of N.Y. v. Pearson, 146 Minn. 342, 178 N.W. 817 (1920); Aetna Acc. & Liab. Co. v. Miller, 54 Month. 377, 170 Pac. 760 (1918); In re South Philadelphia State Bank's Insolvency, 295 Pa. 433, 145 Atl. 520 (1929); Maryland Casualty Co. v. McConnell, 148 Tenn. 656, 257 S.W. 410 (1924); United States Fid. & Guar. Co. v. Central Trust Co., 95 W.Va. 458, 121 S.E. 430 (1924); and cf Northwestern Nat. Bank of Superior v. Superior, 103 Wis. 43, 79 N.W. 54 (1899).

Footnote 11 lists jurisdictions coming out the other direction n the basis of an extended common-law analysis:

Green v. Homewood, 222 Ala. 225, 131 So. 897 (1931); Maryland Casualty Co. v. Rainwater, 173 Ark. 103, 291 S.W. 1003 (1927); Board of County Comm'rs of San Miguel County v. McFerson, 90 Colo. 408, 9 Pac.(2d) 614 (1932); Lake Worth Inlet Dist. v. First Am. Bank & Trust Co., 97 Fla. 174, 120 So. 316 (1929); Fidelity & Deposit Co. of Md. v. Brucker, 183 N.E. 668 (Ind. 1933); Leach v. Commercial Sav. Bank, 205 Iowa 1154, 213 N.W. 517 (1927); Denny v. Thompson, 236 Ky. 714, 33 S.W.(2d) 670 (1930); Commonwealth v. Commissioner of Banks, 240 Mass. 244, 133 N.E. 625 (1922); Fry v. Equitable Trust Co., 264 Mich. 165, 249 N.W. 619 (1933); Potter v. Fidelity & Deposit Co. of Md., 101 miss. 823, 58 So. 713 (1912); In re Holland Banking Co., 313 Mo. 307, 281 S.W. 702 (1926); Freeholders of Middlesex County v. State Bank of New Brunswick, 29 N.J. Eq. 268 (1878), aff'd 30 N.J. Eq. 311 (1878); North Carolina Corp. Comm. v. Citizens' Bank & Trust Co.., 193 N.C. 513, 137 S.E. 587 (1927); Fidelity & Casualty Co. of N.Y. v. Union Sav. Bank Co., 119 Ohio St. 124, 162 N.E. 420 (1928); State v. Harris, 18 S.C.L. 598 (1832); United States Fid. & Guar. Co. v. Carter, 170 S.E. 764 (Va. 1933); cf Phillips v. Yates Center Nat. Bank, 98 Kan. 383, 158 Pac. 23 (1916); Columbia Bank & Trust Co. v. United States Fid. & Guar. Co., 33 Okla. 535, 126 Pac. 556 (1912)

There's no way I can read all those cases. But they're surely worthy of a skim both to get a sense of how they use the doctrinal development, the portability of the arguments advanced into the contemporary doctrinal landscape, and the relevant authorities upon which they rest.

There's also a cluster of cases which the author cites as holding "the prerogative is an indivisible sovereign right lodged only in that political body representative of all the people."

Aetna Casualty & Surety Co. v. Bramwell, 12 F.2d 307 (D. Ore. 1926) [I like this one because it's a) a federal court; and b) used the exact phrase "residuum of sovereignty" that I was so proud of -- G.], County of Glyn v. Brunswick Terminal Co., 101 Ga. 244, 28 S.E. 604 (1897); People ex rel. Nelson v. Home State Bank, 338 Ill. 179, 170 N.E. 205 (1930); Campion v. Village of Graceville, 181 Minn. 446, 232 N.W. 917 (1930); Bignell v. Cummins, 69 Mont. 294, 222 Pac. 797 (1923); Board of Comm'rs San Miguel County v. People's Bank & Trust Co., 34 N.M. 166, 279 Pac. 60 (1929); In re Northern Bank of N.Y., 212 N.Y. 608, 106 N.E. 749 (1914); United States Fid. & Guar. Co. v. Rainey, 120 Tenn. 357, 113 S.W. 397 (1908); County Ct. of Calhoun County v. Matthews, 99 W. Va. 483, 129 S.E. 399 (1925).