Price, Gaulkin and Sullivan. The opinion of the court was delivered by Sullivan, J.A.D.
The Commissioner of Banking and Insurance of the State of New Jersey approved the application of the proposed "State Bank of Plainfield" for the charter of a bank to be located at 20-34 Somerset Street, Plainfield, New Jersey. Two objector banking institutions appeal.
The stenographic record of the hearing before the Commissioner consists of more than 400 pages. Several detailed studies and reports involving matters pertinent to the application were marked in evidence.
The substance of applicant's proof was that the City of Plainfield was located in an area which was undergoing
marked growth in population and industry, and that because of its strategic location Plainfield was and would continue to be a center for trade, business and banking. It was forecast that banking needs in the area would substantially increase within the next few years. It was also shown that the recent consolidation of the Plainfield Trust Co., the State Trust Co., the Plainfield National Bank, and all their branches into the Plainfield Trust State National Bank, had left Plainfield with this one commercial bank, except for a branch office of the Suburban Trust Company. The dominant position of the new Plainfield Trust State National Bank was pointed to as a potential for monopoly. In the opinion of the experts produced by applicant, all of the foregoing factors indicated that the proposed bank would be successful, and its establishment would serve the interest of the public and would not adversely affect existing banking facilities in the area.
The objectors, who included the present appellants, the Plainfield Trust State National Bank and the Suburban Trust Company, argued that Plainfield's position as a trade, business and banking center had been overstated. It was submitted that present banking facilities in Plainfield were competitive and were adequate to handle actual as well as prospective banking needs. Objectors' experts not only said that there was no need for another commercial bank in Plainfield, but they also voiced the fear that the establishment of a new bank, in all probability, would result in serious disadvantage to the community, the proposed bank itself, and all other financial institutions in Plainfield.
Sometime after the hearing was concluded the Commissioner filed a decision, determination and order granting the application. His ruling will be discussed in resolving the several questions presented by this appeal.
Preliminarily, it is argued that the Commissioner, in part at least, went outside the record and considered evidence which appellants have not had the opportunity to meet. This
point is made because of the following reference in the Commissioner's decision to an "independent investigation" made by him in connection with this application.
"In addition, as provided by section 11 of The Banking Act, relevant facts and circumstances arising out of my independent investigation were considered. All exhibits or facts which I considered are of record in our case file."
This is charged to be a violation of the rule set forth in Mazza v. Cavicchia , 15 N.J. 498 (1954), and Elizabeth Federal Sav. & Loan Ass'n v. Howell , 24 N.J. 488 (1957), that where a hearing is prescribed by statute, nothing must be taken into account by the administrative tribunal in arriving at its determination that has not been introduced in some manner into the record of the hearing.
There is no basis for the criticism of the Commissioner's actions on this application. His affidavit shows that his "independent investigation," which is sanctioned by the Banking Act (N.J.S.A. 17:9 A -11 A and D), consisted of nothing more than consulting a banking circular published by his own department and making a personal visit to and inspection of the locale. That this was done in order to better evaluate the evidence in the case is apparent from his decision which details the facts on which he rested his ruling, and indicates the evidence considered by him in making his findings. Furthermore, it was entirely proper for the Commissioner to use matters within his expert knowledge as ...