In the case of People's Bank v. Calhoun, the Supreme Court of the United States was asked to decide whether a bank could be held liable for the wrongful acts of its officers. The case arose when the People's Bank of Alabama was sued by a former customer, Calhoun, for failing to pay a debt. Calhoun argued that the bank was liable for the wrongful acts of its officers, who had failed to pay the debt. The Supreme Court held that the bank was not liable for the wrongful acts of its officers. The Court reasoned that the bank was a separate legal entity from its officers, and that the officers were not acting on behalf of the bank when they failed to pay the debt. The Court also noted that the bank had no knowledge of the officers' actions and had not authorized them to act on its behalf. The Court concluded that the bank was not liable for the wrongful acts of its officers, and that Calhoun's claim against the bank must fail. This decision established the principle that a corporation is not liable for the wrongful acts of its officers, unless the corporation has authorized the officers to act on its behalf.

In People's Bank v. Calhoun, the Supreme Court was tasked with determining whether a state court had jurisdiction to issue an injunction against a national bank in order to prevent it from collecting on notes that were secured by mortgages of real estate located within the state. The majority opinion held that the state court did not have such authority because Congress had exclusive power over national banks and their operations under Article I, Section 8 of the Constitution. However, Justice Field dissented from this decision and argued that while Congress does indeed possess certain powers related to banking activities, those powers do not extend so far as to completely preempt states' ability to regulate matters concerning property rights within their own borders. He further noted that if federal law is silent on any particular matter then states are free to exercise their police power in order protect citizens’ interests without interference from Congress or other branches of government.