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STATE EX REL. HUSTON v. SHEARSON/AMERICAN

No. 85-1825.

408 N.W.2d 363 (1987)

STATE of Iowa, ex rel., Thomas H. HUSTON, Superintendent of Banking; Iowa Department of Banking; John Pringle, Supervisor of Savings and Loan Associations Office of The Auditor of State of Iowa, Plaintiffs, v. SHEARSON/AMERICAN EXPRESS, INC., A Delaware Corporation; Boston Safe Deposit & Trust Company, A Massachusetts Bank; Dean, Witter, Reynolds, Inc., A Delaware Corporation; Great Western Savings & Loan Assn., A California Association; City Federal Savings & Loan Assn., A New Jersey Federal Association; World Savings & Loan Assn., A California Association; Merrill, Lynch, Pierce, Fenner & Smith, Inc., A Delaware Corporation; California Federal Savings & Loan Assn., A California Federal Association; Coast Federal Savings & Loan Assn., A California Federal Association; Glendale Federal Savings & Loan Assn., A California Federal Association; Home Federal Savings & Loan Assn., A California Federal Association; Guarantee Savings & Loan Assn., A California Federal Association; Imperial Savings & Loan Assn., A California Federal Association; A.G. Edwards & Sons, Inc., A Delaware Corporation; First National Bank of St. Louis, A Missouri National Bank; Paine, Webber, Jackson & Curtis, Inc., A Delaware Corporation; Provident National Bank, A Pennsylvania National Bank; Stifel, Nicholaus & Co., Inc., A Missouri Corporation; Mercantile Trust Co., N.A., A Missouri Bank; Norwest Bank of Minneapolis, N.A., A Minnesota National Bank; Bank One of Columbus, N.A., An Ohio National Bank; Buckeye Federal Savings & Loan Assn., An Ohio Association; and Pacific First Federal Savings Bank, A Federally Chartered Mutual Savings Bank, Defendants-Movants, Iowa Independent Bankers Assn., Iowa Bankers Assn., and Independent Bankers Assn. of America, Intervenors.

Supreme Court of Iowa.

June 17, 1987.

Attorney(s) appearing for the Case

Thomas J. Miller, Atty. Gen. and Donald G. Senneff and William O. Hagen, Asst. Attys. Gen., for plaintiffs.

John D. Hudson of Carney, Hudson & Williams, Des Moines, and Robert J. Kheel, Patricia S. Skigen, Michael R. Young, and Susan E. Amron of Wilkie, Farr & Gallagher, New York City, for defendants Shearson/American Exp., Inc. and Boston Safe Deposit and Trust Co.

Denny M. Dennis of Bradshaw, Fowler, Proctor & Fairgrave, Des Moines, and Steven J. Kolleeny, Janice M. Lee, Francis B. Marjorie, and Douglas M. Kraus of Skadden, Arps, Slate, Meagher & Flom, New York City for defendants Merrill, Lynch, Pierce, Fenner & Smith, Inc. and California Federal Sav. and Loan Ass'n.

John D. Hudson of Carney, Hudson & Williams, Des Moines, for defendant Dean, Witter, Reynolds, Inc.

Gerald H. Grask, Des Moines, and McKenna, Connor & Cuneo, Los Angeles, Cal., for defendants Great Western Sav. and Loan Ass'n, City Federal Sav. and Loan Ass'n, and World Sav. and Loan Ass'n.

Gerald H. Grask, Des Moines, and G. Howard Fraser, Los Angeles, Cal., for defendants Coast Fed. Sav. and Loan Ass'n, Glendale Federal Sav. and Loan Ass'n, Home Federal Sav. and Loan Ass'n, Guarantee Sav. and Loan Ass'n, and Imperial Sav. and Loan Ass'n.

A. Roger Witke and Timothy J. Walker of Whitfield, Musgrave, Selvy, Kelly & Eddy, Des Moines, Joanne D. Martin of Pepper, Martin, Jensen, Maichel & Hetlage, St. Louis, Mo., and Arthur L. Smith, Washington, D.C., for defendant A.G. Edwards & Sons, Inc.

Paul A. Zoss and William A. Eddy of Adams, Howe & Zoss, Des Moines, for defendant Paine, Webber, Jackson & Curtis, Inc.

Roy M. Irish of Patterson, Lorentzen, Duffield, Timmons, Irish & Becker, Des Moines, and Thomas E. Douglas of Coburn, Croft & Putzell, St. Louis, Mo., for defendant Stifel, Nicholaus & Co., Inc.

F.L. Burnett II of Nyemaster, Goode, McLaughlin, Emery & O'Brien, Des Moines, for defendant First Nat. Bank of St. Louis.

F.L. Burnett II of Nyemaster, Goode, McLaughlin, Emery & O'Brien, Des Moines, and Matthew M. Strickler, Philadelphia, Pa., for defendant Provident Nat. Bank.

F.L. Burnett II of Nyemaster, Goode, McLaughlin, Emery & O'Brien, Des Moines, and Robert H. Brownlee, St. Louis, Mo., for defendant Mercantile Trust Co., N.A.

Thomas D. Hanson of Hanson, Bjork & Russell, Des Moines, and Duane W. Krohnke, Minneapolis, Minn., for defendants Norwest Bank of Minneapolis, N.A. and Bank One of Columbus, N.A.

John V. Donnelly of Brown, Winick, Graves, Donnelly, Baskerville & Schoenebaum, Des Moines, for defendant Buckeye Federal Sav. and Loan Ass'n.

John C. Cortesio, Jr., of Bradshaw, Fowler, Proctor & Fairgrave, Des Moines, for defendant Pacific First Federal Sav. Bank.

John Gamble, Anthony Longnecker, and Brent B. Green of Gamble, Riepe, Webster, Davis & Green, Des Moines, and Richard W. Berglund, Des Moines, for intervenors Iowa Independent Bankers Ass'n, Iowa Bankers Ass'n, and Independent Bankers Ass'n of America.

Considered by HARRIS, P.J., and McGIVERIN, LARSON, CARTER and LAVORATO, JJ.

HARRIS, Justice.

Four questions have been certified from the federal court which inquire into whether a widespread brokerage practice is proscribed because the brokers are not licensed as bankers in Iowa:

When a brokerage doing business in Iowa receives money from an Iowa depositor for deposit in a state or national bank:

(1) Is the brokerage, if acting in the capacity of agent for the bank, in violation of Iowa Code section 524.107(1)?

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