National Bank v. City Bank was a United States Supreme Court case that addressed the issue of whether a national bank could be held liable for the debts of a state bank. The case arose when the City Bank of New York failed and its creditors sought to recover their losses from the National Bank of New York. The creditors argued that the National Bank was liable for the debts of the City Bank because the two banks had a common director. The Supreme Court held that the National Bank was not liable for the debts of the City Bank. The Court reasoned that the National Bank was a separate legal entity from the City Bank and that the two banks had distinct directors and shareholders. The Court also noted that the National Bank had not assumed any of the liabilities of the City Bank. Therefore, the Court concluded that the National Bank was not liable for the debts of the City Bank.

In National Bank v. City Bank, the United States Supreme Court was asked to decide whether a national bank could be held liable for damages resulting from its negligence in failing to collect and pay over funds due on a note given by one of its customers. The majority opinion found that the national bank had no such liability because it was not acting as an agent or trustee for the customer when collecting and paying out money on his behalf. Justice Field dissented, arguing that under certain circumstances, banks are responsible for their actions in handling deposits entrusted to them by their customers. He argued that if a bank fails to exercise reasonable care in collecting and paying out funds due on notes given by its customers, then it should be held accountable just like any other person who negligently handles another's property would be liable.