BANKS AND BANKING-NATIONAL BANKS-AMENABILITY TO STATE STATUTE RESTRICTING USE OF WORD "SAVINGS"

Authors

Donald M. Wilkinson, Jr. S.Ed., University of Michigan Law SchoolFollow

Abstract

Defendant, a bank organized under the National Bank Act and transacting business in the State of New York, used the words "saving" and "savings" in various ways in the advertising and conduct of its banking business. The state brought suit, seeking an injunction restraining the use of these words, alleging that in- so using them defendant had violated subdivision 1 of section 258 of the New York Banking Law. In defense, the bank contended that this provision, as it applied to national banks, was unconstitutional as a contravention of federal statutory provisions. The trial court dismissed the complaint on its merits, but this was reversed by the appellate division, whose decision was affirmed by the New York Court of Appeals. On appeal to the Supreme Court of the United States, held, reversed, one justice dissenting. Defendant as a national bank is authorized to receive savings deposits. A necessary incident to this is the power to advertise the availability of these accounts to the public. Therefore, a state's attempt to restrict this power is invalid. Franklin National Bank of Franklin Square v. New York, 347 U.S. 373, 74 S.Ct. 550 (1954).

Recommended Citation

Donald M. Wilkinson, Jr. S.Ed., BANKS AND BANKING-NATIONAL BANKS-AMENABILITY TO STATE STATUTE RESTRICTING USE OF WORD "SAVINGS", 52 Mich. L. Rev. 1233 (1954).
Available at: https://repository.law.umich.edu/mlr/vol52/iss8/11