# Petition for Writ of Certiorari — Bank of Commerce v. City National Bank > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385607_1608%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1974 - **Citation:** 416 U.S. 905 ## Text —ee Supreme Court, U. $. ' ABS ara t * Ran: are FILED SUPREME: \* JAN 22 1974 MICHAEL RODAK, JR..CLERK IN THE SUPREME COURT OF THE UNITED STATES TERM, 197 no, ©€8- 1142 BANK OF COMMERCE OF LAREDO, PETITIONER vs CITY NATIONAL BANK OF LAREDO, ET AL PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT Jacob G. Hornberger 915 Victoria Street Laredo, Texas 78040 Attorney for Petitioner wae aPC mae wilt Se fra teenth Berenice: elite, MeN th TD al are a Ang) it RW 1B TABLE OF CONTENTS Page TABLE OF CASES USC, Section TO6s USC, Section 1009 ---...........5... 60 5 USC, Section 1009 (C), Subsec. 10(c)--- 61 12 USC, Sections 21, 26 and 27 -------- IN THE AO MAIS POS SSC CLI * SUPREME COURT OF THE UNITED STATES TERM, 197 NO. BANK OF COMMERCE OF LAREDO, PETITIONER VS CITY NATIONAL BANK OF LAREDO, ET AL PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT The petitioner, Bank of Commerce of Laredo, respectfully prays that a writ of cer- tiorari issue to review the judgment and opinion of the United States Court of Appeals for the Fifth Circuit, entered in this proceeding on September 13, 1973; and to the order of that court dated October 25, 1973, denying the Petitioner's Petition for Rehearing. OPINIONS BELOW The opinion of the Court of Appeals for the Fifth Circuit, which appears at App. A, pages 1 thru 20, is reported at 484 F2d 284, Insofar as counsel can determine, the opinion of the District Court for the Southern District of Texas, Laredo Division has not been published, but it is reproduced at App. C, pages 23 thru 33 hereof. The order of the Comptroller of the Currency appears at App. E, Pages 37 thru 44. JURISDICTION The Judgment of the Court of Appeals for the Fifth Circuit (App.A, pp. 1 thru 20), was entered on September 13, 1973. A timely Petition for Rehearing was denied on October 25, 1973. The jurisdiction of this Court is invoked under 28 USC Section 1254 (1). QUESTIONS PRESENTED FOR REVIEW l. Did the trial court err in denying the plaintiff (petitioner herein) the right to the use of discovery processes? 2. Did the trial court err in refusing to order the Comptroller of the Currency to explain the reasons for his decision approving the application for the charter of the defendant bank? PLIERS CIOS SLE OR, LE PEE LM AL ES PR EO ie aa hr taast 706 3. Did the trial court err in hold- ing that the Comptroller's deci- sion approving the application for the charter of the defendant bank was not arbitrary, capricious or otherwise not in accordance with law and in granting the defendants' motion for summary judgment on that basis? STATUTORY PROVISIONS INVOLVED Title 5, United States Code, Section '706. Scope of review. --To the extent necessary to decision ail when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the mean- -4- LEROEOLI SL, PLAIN sind te, incenth ded. ing or applicability of the terms of an agency action. The reviewing court shall-- (1) compel agency action unlaw- fully withheld or unreasonably delayed ; and (2) hold unlawful and set aside agency action, findings and conclusions found to be-- (A) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; (B) contrary to constitutional right, power, privilege or immunity; (C) in excess of statutory juris- diction, authority, or limitations, or short of statutory right; (D) without observance of pro- cedure required by law; (E) unsupported by substantial evi- dence in a case subject to sections 556 and 557 of this title or otherwise re- viewed on the record of an agency hear- ing provided by statute; or (F) unwarranted by the facts to the extent that the facts are subject to trial de novo by the reviewing court. In making the foregoing determinations, the court shall review the whole record or those parts of it cited by a party, and due account shall be taken of the rule of pre- judicial error. (Sept. 6, 1966, P.L. 89- 554§1, 80 Stat. 393," and Title 12 USC, being the National Bank Act, and particularly Sections 21, 26 and 27 of said Title 12, which sections are reproduced at Appendix F, pp. 45 thru 48 ° che Kore ist napdaigs tiaitas bailoa STATEMENT OF THE CASE Federal Jurisdiction in the Court of the first instance was invoked under the provi- sions of Title 5, Section 706, United States Code, and Title 12, United States Code, and particularly Sections 21, 26 and 27 thereof, An application for a charter of the proposed defendant, City National Bank of Laredo, dated November Il, 1971, was submitted to the Regional Administrator in Dallas, Texas, on November 12, 1971, by the defendants, Hall, Sanchez, Guerra, Magnon and Zuniga. (See page 838 of the Administrative File). On November 22, 1971, the application was returned for correction. (Page 829 of AF). A corrected application was filed on November 26, 1971, (page 828 of AF), and this application was accepted for filing on December 3, 1971. (p. 821 of AF).On or about December 13, 1971, the TESS Sy Se ee sini Union National Bank of Laredo requested per- mission to be heard on the application, (p. 797 of AF), and on the same day the plaintiff bank; ] Bank of Commerce of Laredo notified the Comp- troller it desired to be heard (p. 795 AF). On December 16, 1971, the Union National Bank of Laredo requested a formal hearing (p. 791 of AF). On December 22, 1971, Ramiro Sanchez, Presi- dent of the Laredo National Bank and one of the organizers of the Proposed City Nationa] Bank, wrote to the Regional Administrator Stating that the Laredo National Bank would like to appear in favor of the petition ( Pp. 783 of AF). On Decem- ber 28, 1971, the applicants for the charter requested an extension of time in which to file their economic Survey to January 7, 1972, and this application was granted on January 3, 1972, (pp. 780 and 781 of AF). This survey prepared by the applicants was filed on or about January 5, 1972, and on January 7, 1972, the attorney for ICES NEON EEE OLE CVD OOS SILER EBLE LEE LIER — the applicants wrote to the Regional Administrator j and stated that they did not have a definite location yet, but to keep this information confidential. (p. 773 of AF). On January 14, 1972, Mr. Knight, a Bank Examiner, was ordered by the Regional Administrator to commence a field investigation on January 24, 1972, and he was furnished a copy of the economic survey filed by the applicants. The Regional Administrator then set the formal hearing for February 15, 1972, in Dallas (p. 758 of AF). The Bank of Commerce of Laredo, Petitioner herein, filed a motion for continuance on or about February 4, 1972 (p. 754 of AF), which was denied by letter dated February 7, 1972, (p. 748 of AF). A hearing was held on February 15, 1972, anda transcript of the matters pre- sented by the various parties present appears as an attachment to the Administrative file. Pre- liminary approval of the application was given -9- 32 accordance with law. For this reason, the several motions for summary judgment filed by the respective Defendants must be, and hereby are, granted. Counsel for the Defendants shall prepare a form of final judgment in accordance with the foregoing Memorandum and Order, and present same to the Court within fifteen (15) days from this date. The Clerk shall furnish the appropriate counsel with copies hereof. Signed this 24th day of April, 1973. /s/ OWEN D. COx UNITED STATES DISTRICT JUDGE FINAL JUDGMENT (Number and Title Omitted) Filed: May 16, 1973 The Court, having heard the respective Motions for Summary Judgment, or in the al- ternative for Judgment on the Pleadings of William B. Camp and Michael Doman, indivi- dually and in their official Capacities, and the si- milar motions of the private defendants, the City National Bank of Laredo, Horace C. Hall, Ill, Ramiro Sanchez, Alberto H. Magnon, Jr., Armengol Guerra, Jr., Carlos A. Zuniga, Max A. Mandel, Gary G. Jacobs, and the plaintiff's opposition thereto, and finding, on the basis set out in the Memorandum and Order filed herein on April 25, 1973, that the motions of such defendants should be granted, it is accordingly ORDERED, ADJUDGED AND DECREED that the Bank of Commerce of Laredo shall have App. D aad 34 and take nothing against the above-named defen- dants; that this Civil Action and the same is hereby DISMISSED WITH PREJUDICE; and that the costs of these proceedings are hereby adjudged against the plaintiff, Bank of Commerce of Laredo. DONE at Corpus Christi, Texas, this 15th day of May, 1973. /s/ OWEN D. Cox UNITED STATES DISTRICT JUDGE APPROVED AS TO FORM: /s/ HORACE C, HALL II HORACE C. HALL, III Sames-Moore Building Laredo, Texas 78040 /s/ GEORGE KAZEN GEORGE KAZEN Mann, Castillon, Freed & Kazen P.O. Box 820 Laredo, Texas 78040 App. D - 35 er a ae ee ee /s/ J. G. HORNBERGER J. G. HORNBERGER 915 Victoria Street Laredo, Texas 78040 ANTHONY J. P, FARRIS United States Attorney By: /s/ WILLIAM L, BOWERS, JR. WILLIAM L, BOWERS, JR. Assistant United States Attorney May 23, 1972 Mr. Horace C. Hall, III Post Office Box 207 Laredo, Texas Dear Mr. Hall: We are pleased to inform you that the Comptroller of the Currency has granted pre- liminary approval of the application submitted by you and your associates to organize a Na-~ tional Bank as follows: Title: "City National Bank of Laredo" Location: 4500 San Bernardo Avenue, Laredo, Texas Capital Authorized - $ 345,000 Shares of Stock - 34, 500 Capital Issued - $ 300,000 Issued - 30, 000 Surplus - $ 150,000 Par Value - $ 10.00 Undivided Profits - $ 150,000 Sale Price =e 20.00 In addition to the aforementioned, this approval is granted subject to the following conditions: 1. That executive management accepta- ble to this office will be provided. 2. It is understood that 51% of the stock of the new bank will be offered to shareholders of the Laredo National Bank on a pro-rata share- for-share basis and no one individual or his interests holding in excess of 5%. 3. Any individual or his interest who will hold 5% of the stock will file Financial and Biographical Reports. 4. It should be understood that subscrip- tion funds collected during the organization of the bank may only he invested in United States Govern- App. E - 38 ment Securities. 5. That the use of free service charge accounts at the opening of the bank will not be permitted without the prior approval of this £ office. 2 6. If a buy or sell agreement is contem- plated between the directors or incorporators, the proposed agreement should be forwarded to this office for review. 7. That all organization expenses in con- nection with the organization of the bank will not be capitalized, but will be charged directly to the Undivided Profits Account of the bank on the General Ledger on the date the bank opens for business. . 8. That the bank's books will be main- tained on an accrual method acceptable to this office. 9. That legal fees in connection with the App. E - 39 organization of the bank will not exceed a maxi- mum of $5,000. In addition, a complete log must be kept showing the date, hours worked, nature of the work and fee charged. 10. An offering Circular in connection with the issuance of the Capital stock must be filed. 11. Stock certificates shall not be issued prior to the date the bank opens for business, it being understood that all stock will be issued immediately following the opening of the bank. 12. In addition to regular coverage, the bank will have in force $1,000,000 excess Fi- delity Bond the date it opens for business. This should be reflected in the minutes of the meet- ing at which regular coverage is purchased. 13. Land and building will be owned by the bank and the investment in fixed assets should not exceed $240, 000. 14. Correspondent bank balance of the App. E - 40 new bank should not be used to support borrow- ings of the organizers and proposed directors in connection with the stock acquisition of the new bank. 15. That the active senior executive officer will serve as a member of the Board of Directors. 16. Within one year from the date the bank opens for business any new director or officer must file Financial and Biographical Reports with the Regional Administrator prior to assuming the responsibilities of the position. Directors: At the organization meeting of the incorporators, the following names should be submitted for election as interim directors: Armengol Guerra, Jr, Horace C, Hall III Alberto H. Magnon, Jr. Ramiro Sanchez App. E = 41 Carlos A. Zuniga Officers: Alberto H. Magnon, Jr. -President- $16,000 per annum Ramiro Sanchez-Chairman of the Board- no remuneration «$e Financial and Biographical Reports of any officers or additional directors should be for- warded to Regional Administrator of National Banks, Michael Doman. Banking Quarters: Please submit data with res- pect to a definite location, with information as to the terms and cost of the investment in or lease of bank premises and the estimated cost of furniture, fixtures and equipment at this site to this office. The "Comptroller's Manual for National Banks" will be mailed to you under separate App. E - 42 cover, Forms and instructions to be used in the Organization procedure are enclosed. We invite your attention to Page l, Paragraph 3 of the Instructions wherein the first phase of the organization should be completed within fifteen days. Your attention is invited to the enclosed, Banking Circular No. 31, dates October 22,1970. This circular should be presented at the meeting of the Interim Board and each director should be apprised of the contents of the circular. =. We assure you that we shall be pleased to have you communicate with us at any time we can be of help to you and your associates in completing the organizational plan. Very nae yours, (Signed, Thomas G. DeShazo) Thomas G. DeShazo Deputy Comptroller of the Currency Enclosures jab TITLE 12 U.S.C. SECTION 21 Section 21. Formation of national bank- ing associations - Incorporators - Articles of association - Associations for carrying on the business of banking under this Title may be formed by any number of natural persons, not less in any case than five. They shall enter into arti- cles of association, which shall specify in gen- eral terms the object for which the association is formed, and may contain any other provisions, not inconsistent with law, which the association may see fit to adopt for the regulation of its business and the conduct of its affairs. These articles shall be signed by the persons uniting to form the association, and a copy of them shall be for- warded to the Comptroller of the Currency, to be filed and preserved in his office. (R. S. § 5133) App. F - 45 TITLE 12 U. S. C. SECTION 26 Comptroller to determine if associations can commence business. - Whenever a certificate is transmitted to the Comptroller of the Currery, 2s provided in this Title, and the association transmitting the same notifies the Comptroller that all of its capital stock has been duly Paid in, and that such association has complied with all the provisions of this Title required to be complied with before an association shall be authorized to commence the business of bank- ing, the Comptroller shall examine into the con- dition of such association, ascertain especially the “mount of money paid in on account of its capital, the name and place of. residence. of each of its directors, and the amount of the capital stock of which each is the owner in good faith, and gener- ally whether such association has complied with App. F- 46 all the provisions of this title required to entitle it to engage in the business of banking; and shall cause to be made and attested by the oaths of @ majority of the directors, and by the president or cashier of the association, a statement of all the facts necessary to enable the Comptroller to determine whether the association is lawfully entitled to commence the business of banking. (R. S. § 5168; Sept. 8, 1959, P. L. 86-230, § 2, 73 Stat. 457.) TITLE 12 U. S. C. SECTION 27 Certificate of authority to commence banking. -If, upon a careful examination of the facts so reported, and of any other facts which may come to the knowledge of the Comptroller, whether by means of a special commission appointed by him for the purpose of inquiring into the condition of such association, or other- wise, it appears that such association is law- fully entitled to commence the business of banking, the Comptroller shall give to such association a certificate, under his hand and official seal, that such association has complied with all the provisions required to be complied with before commencing the business of banking, and that such association is authorized to commence such business. But the Comptroller may withhold from an association his certificate authorizing Sti ceaiinlaiailandiital of business, whenever he has reason to suppose that the shareholders have formed the same for any other than the legitimate objects contemplated by this Title. (R. S. § 5169.) App. F - 48 --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385607_1608%3A1. Public record. Not legal advice.