Ganey, Freedman and Seitz, Circuit Judges.
This is an appeal by two minority stockholders of the Wellsville National Bank ("Bank"), Borough of Wellsville, York County, Pennsylvania, from the denial by the United States District Court for the Middle District of Pennsylvania, of their motion to vacate that court's order of January 28, 1967, approving a proposed agreement between the Conservator of the Bank and the Bank of Hanover and Trust Company ("Hanover") for the sale of all the assets of the Bank in exchange for Hanover's assumption of all the liabilities (other than to the shareholders as such) of the Bank. Hanover is a State banking institution, organized and existing under the laws of Pennsylvania, with its principal place of business in the Borough of Hanover, York County, Pennsylvania.
Pursuant to the power vested in him by the Bank Conservation Act,*fn1 William B. Camp, the Acting Comptroller of the Currency of the United States, notified Michael C. Kearns, by letter dated January 25, 1967, of his appointment as Conservator for the Bank. The letter stated:
"You are appointed Conservator of [the Bank], * * * effective 10:30 a.m., January 28, 1967. At that time, you will take charge of the bank but will continue regular banking operations receiving deposits and paying out money in the normal course of business * * *.
"You are directed, immediately after taking charge, to enter into an agreement with [Hanover] for the sale of all the assets of [the Bank] to [Hanover] in consideration of the assumption by [Hanover] of all the deposits and other obligations and liabilities of [the Bank] (other than liabilities to the shareholders of [the Bank] as such) on terms as a court of record of competent jurisdiction shall direct."*fn2
On January 28, the day his appointment became effective, the Conservator presented a petition to the United States District Court for the Middle District of Pennsylvania, to sell the assets of the conservatorship estate. Accompanying the petition was a copy of the commission appointing Kearns the Conservator of the Bank, the letter of notification, the purchase and assumption agreement and an affidavit of the acting Comptroller. The latter document stated as one of the reasons for appointing the conservator and directing him to sell the assets of the Bank to Hanover was that the Bank was "dangerously close" to insolvency, that the solvency and safety of the Bank have been "seriously impaired" for an extended period of time and that the condition had steadily worsened, and that the existing management could under no circumstances be permitted to continue in control of the Bank.
On that same day, District Judge William J. Nealon, Jr., signed an order approving the purchase and assumption agreement. The order stated the Court had concluded that the agreement was "fair, just, and equitable, and that the sale of the assets of the Conservatorship estate, as contemplated by said agreement, is in the best interests of the Conservatorship estate." The order further provided "that service of a copy of this Order be made upon all stockholders of the Wellsville National Bank by certified mail, return receipt requested, and that said stockholders are given five (5) days from date of service of this Order to object to this Order or show cause why it should be set aside."
On February 6, 1967, Gordon S. Miller, a shareholder of the Bank, and his wife*fn3 filed their "Motions to Intervene" and "Motion to Vacate January 28, 1967 Order." On March 15, 1967, the acting Comptroller filed a paper entitled "Opposition to Motion to Vacate and Motion to Intervene", accompanied by his affidavit. This latter document stated, inter alia, that there were three principal problems facing the Bank which led him to conclude that an immediate sale by the conservator of all the assets of the Bank was the best available course for the protection of the banking public and the Bank's depositors, creditors and shareholders. These three problems were (1) the apparent and continuing insolvency of the Bank and all the improper banking practices which had led to insolvency, (2) the continuing inability of those in control of the Bank to raise new capital, and (3) the improper and possible unlawful activities of Gordon S. Miller (one of the objecting minority stockholders) at various times President, Chairman of the Board and principal individual shareholder of the Bank. The fifth paragraph of the affidavit stated: "5. That the regular and special examinations of the Bank conducted since assumption of control by Gordon S. Miller, disclosed continuing difficulties with loans, capital, liquidity and credit culminating in insolvency, none of which could be resolved in the normal course of supervision or in repeated discussions with [the Bank's] directors."
The Millers first contend that the acting Comptroller exceeded his authority when he entered into an agreement of sale to turn over the Bank to a State bank and then appointed a conservator for the purpose of executing the already prepared and signed agreement when the Bank was operating, meeting all its demands and was not placed in receivership or declared insolvent. Section 203 of the Bank Conservation Act, 12 U.S.C.A. § 203, provides in part: "Whenever he shall deem it necessary in order to conserve the assets of any bank for the benefit of the depositors and other creditors thereof, the Comptroller of the Currency may appoint a conservator for such bank * * *." Under this section, the appointment of a conservator is discretionary on the comptroller's part and is not subject to judicial review. See Davis Trust Co. v. Hardee, 66 App.D.C. 168, 85 F.2d 571, 107 A.L.R. 1425 (1936). Also see discussion in Minichello v. Saxon, 337 F.2d 75, 83 (C.A. 3, 1964), cert. denied, 380 U.S. 952, 85 S. Ct. 1084, 13 L. Ed. 2d 969.*fn4
Regarding the sale of the assets of a national bank, section 203 further provides: "Such conservator shall have all the rights, powers, and privileges now possessed by or hereafter given receivers of insolvent national banks * * *. During the time that such conservator remains in possession of such bank, the rights of all parties with respect thereto shall, subject to the other provisions of this subchapter, be the same as if a receiver had been appointed therefore. * * *" The powers of a national bank receiver are set forth in sections 16 and 17 of the Act of September 8, 1959, 73 Stat. 458, 12 U.S.C.A. §§ 191 and 192. Section 191, U.S.C.A., in part, provides: " Whenever * * * the comptroller shall become satisfied of the insolvency of a national banking association, he may, after due examination of its affairs, in either case, appoint a receiver who shall proceed to close up such association." (Emphasis added.) Section 192, U.S.C.A., states: "On becoming satisfied, as specified in sections 131 and 132 [U.S.C.A.] of this title, that any association has refused to pay its circulating notes as therein mentioned, and is in default, the Comptroller of the Currency may forthwith appoint a receiver, * * * Such receiver, under the direction of the comptroller, shall take possession of the books, records, and assets of every description of such association, collect all debts, dues and claims belonging to it, and, upon the order of a court of record of competent jurisdiction, may sell or compound all bad or doubtful debts, and, on a like order, may sell all the real and personal property of such association, on such terms as the court shall direct * * *."
It can be said on behalf of the acting Comptroller that the words, "Whenever * * * the comptroller shall become satisfied of the insolvency of a national banking association" appearing in § 191, U.S.C.A., gives him the discretion to make a determination of whether a national bank is insolvent*fn5 and that such determination is not reviewable by the courts. However, it becomes necessary to discuss both Acts concerning review.
In Minichello v. Saxon, supra, 337 F.2d 75, 82-84 (C.A. 3, 1964), a derivative shareholders' action to invalidate a sale of assets of a national bank in which this Court concluded that the comptroller's determination under § 181 U.S. C.A., of the National Bank Act, respecting the existence of an emergency so as to obviate the necessity of the approval of a sale of the bank's assets by shareholders owning two-thirds of its stock is reviewable by the courts. However, the court is there construing the 1959 amendment to § 181 which, in no wise, concerns a conservatorship. This section is concerned with the ordinary sale of bank assets and provides that in a purchase or sale of bank stock, "unless an emergency exists and the Comptroller of the Currency specifically waives such requirement for shareholder approval", the necessary two-thirds of the bank's stock is unnecessary. In it, the court points out that the emergency phrase and the waiver phrase are conjoined. The court states: "The language employed with respect to emergency is sharply distinguishable from that evidenced in other sections of the national banking statute involving decisions of the Comptroller such as those concerning appointment of a conservator and termination of a conservatorship." (Page 83) Section 203, 12 U.S.C.A., reads, in part: " Whenever he shall deem it necessary in order to conserve the assets of any bank * * the Comptroller of the Currency may appoint a conservator for such bank and require of him such bond and security as the Comptroller of the Currency deems proper." (Emphasis added.) The court points out in § 205, U.S.C.A., as how termination of a conservatorship contains substantially similar language and states further: "We cannot consider the differing language in Section 181 to have been employed inadvertently, particularly in view of the fact that the moving force in the enactment of the amendment was a desire on the part of Congress to increase protection for shareholders. To construe the statute as entrusting to the Comptroller a non-reviewable discretion ...