Baker v. National State Bank6/21/2002
e so represented.
The Bank's remaining argument, that the stay of judgment and 12 U.S.C.A. § 91, prevented interest from running until all appeals had ended, is unpersuasive.
First, the Bank contends that 12 U.S.C.A. § 91 tolled the accrual of interest. On September 13, 1996, the trial court ordered a stay of the July 26, 1996 order, during "the pendency of all appeals in this matter." On October 25, 1996, the trial court issued an order discharging the judgment lien created by the July 26, 1996 order. The Bank was not required to post a bond, as required by R. 2:9-5(a), apparently because the Bank successfully argued that 12 U.S.C.A. § 91 precluded such a bond and required a stay.
Section 91 prevents a bank, contemplating insolvency, from making transfers "before final judgment in any suit, action, or proceeding, in any State, county or municipal court." The purpose of that specific section was to secure, in the event of insolvency, a just and equal distribution of assets of a national bank among its creditors. Mechs. Univ. Joint Co. v. Culhane, 299 U.S. 51, 55-56, 57 S. Ct. 81, 83-84, 81 L. Ed. 2d 33, 36 (1936). Thus, it prevents prejudgment seizure of bank property by creditors. Third Nat'l Bank v. Impac Ltd., 432 U.S. 312, 323, 97 S. Ct. 2307, 2314, 53 L. Ed. 2d 368, 377 (1977).
The Bank's rather attenuated argument depends solely on the holding in United States v. Lemaire, 826 F.2d 387 (5th Cir. 1987), cert. denied, 485 U.S. 960, 108 S. Ct. 1223, 99 L. Ed. 2d 423 (1988). There, the court stated that a state court judgment was not final unless it was "no longer subject to examination on appeal, either because of disposition on appeal and conclusion of the appellate process, or because of the passage, without action, of the time for seeking appellate review." Id. at 390. Accordingly, the Bank maintains that because the July 26, 1996 order did not become final until the conclusion of the appellate process, interest did not begin to run until that date, March 15, 2000.
Lemaire is readily distinguishable. In Lemaire, the plaintiffs brought a successful breach of contract, fraud and tortious interference with contract suit against MBank Abilene. Id. at 387-88. After the trial court vacated its stay of enforcement of the judgment, and the state appellate court refused to consider the bank's writ of mandamus directing the trial court to give effect to 12 U.S.C.A. § 91, the plaintiffs caused writs of garnishment to be served on the Federal Reserve Bank of Dallas, which stopped clearance of MBank checks and threatened its solvency. Id. at 388. In response to this development, the Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency filed suit against the plaintiffs, invoking 12 U.S.C.A. § 91 as the basis for a preliminary injunction prohibiting the plaintiffs from executing on the state court judgment during the pendency of the state court appeal. Ibid. The district court granted the relief, interpreting the statute's reference to "final judgment" meant a judgment from which no appeal could be taken. Id. at 388. The Fifth Circuit affirmed, reasoning that because § 91 was enacted to assure the orderly and fair liquidation of any national bank falling into insolvency, Congress intended to protect such banks from a seizure of property before the appellate process had been completed. Id. at 390.
Lemaire is of little persuasive value. First, the action in Lemaire threatened to make the bank insolvent, thereby implicating § 91. As pointed out, § 91 deals with transfers by banks during insolvency; indeed, the heading of that section reads: " ransfers by bank and other acts in contemplation of insolvency." In this case, ther
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