Charles Evans Hughes

“ All property, monies, funds, proceeds, rights, credits, accounts and choses in action, of every kind and nature, constituting, derived from, arising out of, or in any manner connected with, or pertaining to, the assessments, regular and special, heretofore accrued and levied against any and all corporations transacting a banking business in this state for the purpose of establishing, maintaining, or reimbursing what was formerly designated as the Depositors' Guarantee Fund of the State of Nebraska ”

“ The principle that a police regulation, valid when adopted, may become invalid because in its operation it has proved to be confiscatory, carries with it the recognition of the fact that earlier compliance with the regulation does not forfeit the right of protest when the regulation becomes intolerable. ”

“ The depositors' final settlement fund is to be distributed only to depositors in banks closed prior to the taking effect of the statute. The department of trade and commerce has authority to administer the fund and to institute and defend suits involving any claims or rights pertaining thereto. That department may grant, in its sound discretion, to any bank, an extension of time, not exceeding three years, from the date of the passage of the act, within which to pay any of the assessments theretofore levied against it. ”

“ While the case has not become moot, the questions raised by the appellants must be considered in the light of the modifying legislation, which has restricted in an important degree their liability to assessments, and has provided for what is, in substance, a liquidation of the guaranty scheme. The appellees, intervening depositors, insist that by their deposits in the state banks they acquired contractual rights which cannot be affected by the later legislation. ”

“ This is a natural feeling as they are in no way responsible for the banks that fail. * * * The guaranty fund, so-called, is merely an insurance company whereby the state banks of Nebraska are the members and must pay through an assessment each other's losses up to the maximum amount of six-tenths of one per cent. ”

“ A number of depositors in the state banks were permitted to intervene. The district court entered a decree in April, 1929, in favor of the complainants, sustaining the contention that the statute providing for such special assessments was, under the facts shown, unreasonable and confiscatory, and hence repugnant to the Fourteenth Amendment. The decree, which gave a permanent injunction, was reversed by the Supreme Court of Nebraska ”

“ The total claims, including both claims adjudicated and those not adjudicated, or the then existing liabilities against the guaranty fund, amounted to $26,400,282.76, and the total amount of assets to be realized would be.$10,451,932.65, leaving a deficit of.$15,948,350.11. The court concluded that 'fully two-thirds of the banks under the existing financial conditions are unable, after paying assessments amounting to 8 per cent. ”