The opinion of the court was delivered by: Marovitz, District Judge.
CROSS MOTIONS FOR SUMMARY JUDGMENT
This action, brought by the Midwest National Bank of Lake
Forest, Illinois, challenges an order of the Comptroller of the
Currency, dated July 13, 1967, approving the application of the
First National Bank of Lake Forest to establish a detached
drive-up banking facility in the depot of the Chicago and
Northwestern Railway Company, in Lake Forest. Named as defendants
are the Comptroller of the Currency (in his capacity as
Administrator of National Banks), the First National Bank of Lake
Forest, the Chicago & Northwestern Railway Company, and the City
of Lake Forest.
The parties have filed cross-motions for summary judgment. They
have submitted affidavits, documents, the administrative record
before the Comptroller, and voluminous briefs in support of their
The application was assigned to a national bank examiner and
notice was sent to the competitor banks in the area, including
plaintiff. Plaintiff filed a written protest, noting the Illinois
prohibition against branch banking (Chap. 16 1/2, § 106,
Ill.Rev.Stat. 1967), and arguing that the proposed facility did
not comply with Illinois law. A hearing was held at plaintiff's
request on May 17, 1967, before the Regional Administrator of
National Banks, and subsequently the Comptroller approved the
This suit was filed a month later to challenge the order of
approval, and to seek an injunction restraining the defendant
Bank from locating its facility on the proposed site.
Although branch banking is prohibited in Illinois, there are
certain exceptions to the rule. Chap. 16 1/2, § 102,
Ill.Rev.Stat., permits a facility adjacent and connected to the
main banking facility provided it complies with certain
conditions,*fn1 and that section additionally allows a facility
established and maintained in accordance with § 105(15).*fn2
Subsection (15), which was adopted at a referendum election and
became effective January 1, 1967, provides for a species of
detached drive-up facilities. The disputed facility in this case
is alleged to comply with the requirements of subsection (15),
and the Comptroller's approval, as is necessary, was based upon
his belief that the facility was in conformity with Illinois law.
12 U.S.C. § 36(c)(1); First National Bank of Logan v. Walker
Bank & T. Co., 385 U.S. 252, 87 S.Ct. 492, 17 L.Ed.2d 343 (1966).
There is no question that the plaintiff, as a competitor
subject to potential competitive harm from the proposed facility,
has standing to pursue this action. 5 U.S.C. § 702 (1967); First
National Bank of Smithfield v. Saxon, 352 F.2d 267 (4th Cir.
1965); Leuthold v. Camp, 273 F. Supp. 695, 697 (D.Mont. 1967).
Jurisdiction is proper under the Administrative Procedure Act,
5 U.S.C. § 1009, and under 28 U.S.C. § 1348, 1394.
The questions in issue are essentially legal ones, calling for
a determination whether the proposed facility complies with the
applicable state law. Although the Comptroller contends review of
his actions is limited by the "substantial evidence" test, or to
correct an abuse of his discretion, the court may review his
actions to be certain they comport with Illinois law.
5 U.S.C. § 706(2)(A). Since he may only approve an Illinois facility which
is permitted under Illinois law, it follows that any action not
complying therewith must be reversed.
Determinations of such legal issues do not involve the exercise
of discretion, unlike issues within the Comptroller's peculiar
expertise in the field of banking. Since legal issues are here in
dispute, the Court, in effect, must review them de novo, paying
due regard to any factual determinations made by the Comptroller
in reaching his decision, and the record which was before him.
There are three issues to be resolved. First, plaintiff
contends that the distance requirements of subsection (15) are
not met. Insofar as pertinent, they provide:
"(a) No facility shall be more than 1500 feet from
the main banking premises of the maintaining bank.
(b) No facility shall be closer than 600 feet to any
then existing main banking premises of another bank
unless * * * [not pertinent here]
[(d)] The distance referred to in this subsection
(15) shall be measured in a straight line from the
nearest point of one premises to the nearest point of
the other premises, the word `premises' being deemed
to mean the boundaries of the real estate on which
the facility or the maintaining bank is located, as
the case may be, and the areas contiguous thereto
which the bank has the exclusive right as owner or
lessee to use or maintain for egress from or ...