A *> , \n2 Cornell University Law Library The Moak Collection PURCHASED FOR The School of Law of Cornell Universit And Presented February 14, 1893 IN nEnoRY OF JUDOB DOUGLASS BOARDMAN FIRBT DEAN OF THE SCHOOL By his Wife and Daugliter A. M. BOARDMAN and ELLEN D. WILLIAMS CDT'-' Cornell University Library KFN5250.A3 1888 3 1924 022 794 915 Cornell University Library The original of this book is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/cletails/cu31924022794915 THE BANKING- LAWS STATE OF NEW YORK. REVISED TO OCTOBER, 1888. CONTAINING ALL LAWS IN FORCE RELATING TO BANES, BANKING ASSO- CIATIONS AND INDIVIDUAL BANKERS; SAVINGS BANKS; TRUST, LOAN, MORTGAGE, SECURITY, GUARANTEE OR INDEMNITY COMPANIES OR ASSOCIATIONS ; ALSO SAFE DEPOSIT COMPANIES. WITH FULL TEXT OF OPINIONS BY TEE ATTORNEY-GENERAL GIVING OF- FICIAL CONSTRUCTION TO THE BANKING LAWS. By EDGAE a. WEEI^EE, Late Chief Clerk o/tke State Banking Departtneni. ALBANY: WEED, PARSONS & CO., PRINTERS. 1888. Entered, according to act of Congress, in the year eigiiteen hundred and eighty-eight, BY WEED, PARSONS & COMPANY, In the office of the Librarian of Congress, at Washington. VEED, PARSONS & COMPANY, PRINTERS AND K L EC T RO T y P E R S , ALBANY, n. Y. S3-S0 A3 m PREFACE. This volume contains all statutory law of the State of New York now in force applicable to banks, banking associations and individual bankers; savings banks; trust, loan, mortgage, security, guarantee or indemnity companies or associations, also of corpora- tions formed for the safe-keeping^ and guaranteeing of personal property. In an appendix will be' found the full text of official opinions by the attorney-general in relation to the legal construc- tion to be given to particular provisions of the banking laws. The fact that rulings of that officer are conclusive and binding until the questions passed upon are determined by the courts, render them of special importance and value to those having relations with banking corporations, whether as officers, shareholders or attorneys. The present contradictory, complex and consequently defective condition of the laws relating to banking is largely owing to State banks having ceased to be banks of issue. A very considerable proportion of the existing law is based on and relates directly to the issue of circulating notes. As this function is no longer exer- cised, much of the law has become obsolete. Whatever provision may be made in the future for a State bank circulation, the old method with its imperfections will not again be employed; after using a secured bank currency (National) for the period of twenty-five years, the return to a system which has been demon- strated to be totally inadequate for the purpose would not be sanctioned. Hereafter, prerequisites of any scheme for a bank currency must be absolute security and a uniformity in design of notes. The banking law of the State is primarily the law of 1838, known" as the general banking law of that year, enacted for the iv Peeface. purpose of making provision for the circulation, security and redemption of bank notes, passed at a time when, with the excep- tion of specie, the sole circulating medium of the country con- sisted of bank notes issued by State banks and individual bankers. Supplemental or additional acts and amendments made to meet special needs or to remedy discovered defects in their practical ope- ration has resulted in a cumbrous code of incongruous laws lacking in symmetry and harmony. To remedy the numerous grave defects in the banking laws, an entirely new statute should be pa^ed, eliminating that which is now practically obsolete, by reason of the changed condition of the State banking system, and simplifying, reducing and uniting into a coherent whole such of the present provisions of law as are ap- propriate, supplementing them with the necessary provisions to meet the present and prospective needs of the banks. This is de- sirable in order to reduce the legislation of fifty years on the sub- ject of banking to a simple, direct and practical code, adapted to existing conditions. The commissioners appointed in 1880 to compile and revise the banking laws, restricted their labors to forming the laws relating to the subject, into a single statute, without attempting to correct inconsistencies or remedy omissions and imperfections. The commissioners, in making their report to the legislature, stated that excepting safety fund statutes, omitted, no alterations had been made in the substantive provisions of the law, and that the so-called revision was believed to embrace the whole body of statutory law in force in the State, relating to banks, banking and trust companies. By the enactment of chapter 409 of the Laws of 1882 the banking laws, of the State were simply collated, not revised. Albany, October 15, 1888. TABLE OF CONTENTS. CHAPTER 409 OP THE LAWS OF 1882, ENTITLED "AN" ACT TO REVISE THE STATUTES OF THIS STATE RE- LATING TO BANKS, BANKING AND TRUST COM- PANIES." PAGE. Chapter I — Tlie banking department 1 II — Examinations of banks, banking associations and individual banliers 7 III — Reports to and by the superintendent 12 IV — General provisions relative to banks, banking associations and individual bankers 19 V — Circulation of banks of deposit and discount 39 VI — Provisions to enforce the responsibility of stockholders of banks of deposit and discount 69 VII — Changes from State to National and from National to State banks 89 VIII — Regulations in relation to moneyed corporations 95 IX — Moneyed corporations other than banks, institutions for sav- ings and insurance companies 109 X — Savings banks, provisions relative to the organization of and the administration of their affairs 119 XI — Prohibitions against unauthorized banking 158 XII — Taxation 163 ADDITIONAL AND SUPPLEMENTAL STATUTES RE- LATING TO BANKS, SAVINGS BANKS AND TRUST COMPANIES. Revision of laws relating to banks, banking and trust companies 175 Repeal of certain laws relating to banks and trust companies 176 Fixing the rate of interest on money at six per cent 181 Holidays and half holidays to be observed in payment of checks, notes, etc. , 182 Designating April 80, 1889, a legal holiday 184 Fixing the time for payment of certain commercial paper 185 Relating to time for payment of checks, drafts, etc 186 Rate of interest on loans exceeding $5,000 may be agreed upon 187 Corporations prohibited from interposing the defense of usury 188 vi Table of Contents. PAGE. Lists of corporations to be furnished to the comptroller by supervisors . . . 189 Relief of corporations as to filing affidavit of payment of capital 190 Relief of stockholders whose certificates of stock have been lost 191 Authorizing joint-stock companies to hold and convey real estate 193 Authorizing corporations to hold real estate in other States 194 Relating to the purchase and sale of real estate by corporations 195 Relating to the reduction of capital stock of joint-stoqk companies 196 Relating to suits by and against joint-stock companies 197 Death of any stockholder not to work a dissolution of corporation 199 For the protection of rights of creditors and others against frauds 200 Relating to the assessment of taxes on incorporated companies 201 Taxing joint-stock corporations for the privilege of organizing 203 Relating to the recovery of State itaxes from delinquent corporations 304 Relating to the sale of franchises of corporations sold under mortgage. . . . 205 Authorizing domestic corporations to reduce capital stock 209 For the protection of stockholders from the wrong doings of directors .... 211 Providing for record evidence of membership of joint-stock companies . . . 215 Certain joint-stock companies may reduce number of trustees to seven . . . 217 Providing for supplying omissions in original certificates of incorporation, 218 Providing for extending the term of existence of joint-stock companies. . . 219 Certificates of incorporations, hereafter filed required to be recorded 220 Regulating the execution and transfer of notes given for patent rights . . . 221 Banks receiving moneys of the State on deposit, to give bonds 222 Assessment to make good deficit in capital of banks, how enforced 223 Authorizing change of location of banks, or individual bankers 224 Authorizing banks and trust companies to change corporate names 227 Authorizing trust or loan companies to invest in certain bonds 229 Authorizing trust companies to be appointed trustees of lunatics, etc 229 Providing for the organization of trust companies (general law) 230 Transfer agents of foreign corporations to exhibit list of stockholders 247 Extending to foreign corporations certain rights and powers 248 Copies of certificates of organization of foreign stock companies, evidence, 249 Relating to the appointment of receivers of corporations 249 Relating to the publication of legal and other notices 254 Providing for the publication of certain public notices at Albany 256 Authorizing the change of coupon bonds of the city of New York 257 Providing for converting coupon bonds into registered bonds 258 BLANK FORMS FOE ORGANIZATION OF STATE BANK- ING ASSOCIATIONS, SAVINGS BANKS, ETC. Certificate of association for bank of discount and deposit 263 Converting from National to State system ; 364 Aflndavit of payment of capital 260 Instructions for organizing banking associations 366 Certificate of increase of capital stock 267 Outline of articles of association 268 Certificate of association for savings bank 275 Table of Contents. yii LAWS RELATING TO CORPORATIONS FORMED FOR THE SAFE KEEPING AND GUARANTEEING OF PER- SONAL PROPERTY. PAGE. Providing for the organization of safe deposit companies 379 Providing for the collection of storage charges on goods 386 Defining the lieu of warehousemen for storage charges 288 PROVISIONS OF LAW RELATING TO CORPORATIONS, JOINT STOCK COMPANIES OR ASSOCIATIONS. Constitution of the State of New York 291 Revised Statutes of the State of New York , 294 Code of Civil Procedure of the State of New York 301 Code of Criminal Procedure of the State of New York 337 Penal Code of the State of New York , 328 OFFICIAL OPINIONS BY THE ATTORNEY-GENERAL ON THE CONSTRUCTION OF CERTAIN PROVISIONS OF LAW RELATING TO BANKS, SAVINGS BANKS AND TRUST COMPANIES. Savings Banks. When superintendent may interfere to stop unlawful practices 845 Deposits with savings banks not liable to taxation 346 Interest on deposits withdrawn three days prior to an interest period 346 Debtors to savings banks are ineligible for trustees 347 Failure for six months to perform committee duties vacates office of trustee, 348 Powers, duties and liabilities of trustees defined 349 Minimum number of trustees required for a savings bank 853 By-law fixing time for holding meeting of trustees suflicient notice 367 Interest on deposits made within ten days of an interest period 868 Penalty for failure to make semi-annual reports, how enforced 369 Term " trust fund," how construed 370 When fixing compensation of officers, how board constituted 371 Surplus of savings banks may be invested in same manner as deposits. . . . 372 Method of estimating the surplus of savings banks 372 An act proposing to tax savings banks, not unconstitutional 375 Acceptance of corporate or official searches, optional with savings banks . . 403 Order of court required for dissolution of savings banks 408 Trustees who do come within prohibition against ' ' indirect interest " .... 409 Acceptance of searches of title companies, optional with savings banks , . . 413 May employ counsel to examine titles through guarantee coinpanies 413 Proof required of applicants for unclaimed dividends of failed banks .... 414 Powers of superintendent in extending time for sale of real estate 417 The Charity Organization Society may receive deposits for safe keeping. . 419 All funds required to be invested in accordance with law 420 Bonds issued by the State of Indiana a lawful investment 376 Bonds issued by the State of Missouri a lawful investment 390 Tiii Table oe Contents. PAGE. Purchase of real estate on whicli to erect buildings to rent prohibited. . . . 353 Investment in five per cent bonds, of District of Columbia, prohibited. . . 355 Investment in bonds, issued by the State of Minnesota, prohibited 361 Investment in mortgage bonds of private corporations, prohibited 863 Unlawful for savings banks of this State to delegate their powers 356 The receiving of special deposits of valuables, for hire, prohibited 365 Unlawful for a savings bank to borrow money on a pledge of its securities, 367 Investment in bonds, issued by the State of Georgia, prohibited 383 Investment in bonds, issued by the State of Alabama, prohibited 393 The making of loans, to highway commissioners, prohibited 394 Time deposits, with banks or trust companies, prohibited 397 Payment of unearned salaries, of deceased officers, prohibited 399 Payment of premiums on bonds, given by employees, prohibited 400 Making voluntary contributions, for the public benefit, prohibited 401 The established surplus not to be used to increase dividends 415 Banks, Banking Associations and Individual Bankers. Complete disclosure of the affairs of banks may be required 424 Securities in which investments may be made 426 Business to be transacted at banking house and not elsewhere 436 Deposits may be received at branch offices in the same city 429 Individual bankers not required to furnish evidence of payment of capital, 430 Individual bankers not to use artificial name appropriate for a corporation, 430 Superintendent not to execute duplicate assignment of mortgages 431 Capital stock of banks may be reduced while impaired 433 Personal liability of shareholders of banks of deposit and discount 433 Directors personally Mable for loss occasioned by unauthorized investments, 438 Time certificates of deposit, with interest, not to be issued 436 Certificates of deposit issued by State banks to be non-negotiable 439 Banks not subject to section 179 of chapter 409, Laws of 1883 440 Receivers of banks required to make reports to the superintendent 443 Banks may deal in securities embraced in term "evidence of debt " 443 Section 117 of chapter 409, Laws of 1882 not applicable to private bankers, 445 Relating to the extension of charters of State banks of deposit and discount, 445 Circulation of tickets representing money, by ice companies, unlawful . . . 447 Persons unlawfully advertising as banks how proceeded against 448 Relating to the change of location of a State bank of deposit and discount, 449 Teust, Loan and Mortgage Companies. Relating to the Mutual Trust Company of the city of New York . . . . ^ 451 Relating to mortgages deposited in the banking department by 452 Additional deposit required of trust companies increasing capital 453 Relating to the American Emigrant Company receiving deposits 457 Foreign trust companies receiving deposits in this State 464 Relating to the Jarvis Conklin Mortgage Trust Company 464 Foreign mortgage companies doing business in this State 476 BANKING LAWS. CHAP. 409. AIT ACT TO REVISE THE STATUTES OP THIS STATE RELATING- TO BANKS, BANKING AND TRUST COMPANIES. Passed July 1, 1882 ; three-fiths being present. Tlie People of the State of New York, represented in Senate and Assembly, do enaot as follows : CHAPTER I. The Banking Depabtment. Section 1, Establishing a banking department. 2. The superintendent. 3. His powers and duties. 4. OflBcial seal. 5. Rooms and furniture. 6. Department expenses. 7. Compensation for extra services forbidden. 8. Examination of securities. 9. When agent appointed to examine. 10. Unclaimed balances to be paid into the treasury. 11. Associations and bankers subject to supervision of superin- tendent. Section 1. There is hereby established a separate and Establish- ing a distinct department which shall be charged with the^^^^^- execution of the laws in relation to banking associations and individual bankers formed or transacting business under the laws of this State, savings banks, trust, loan, mortgage, security, guarantee or indemnity companies or associations, and every corporation or association hav- 2 Bankiitg Laws of the ing the power and receiving money on deposit, existing or incorporated, or which may hereafter exist or become incorporated under the laws of this State with power to receive deposits of money, or assume obligations in this State, other than insurance companies. Constructed from section one, chapter 164, Laws of 1851, and section one, chapter 324, Laws of 1874, the provisions relating to safety fund banlrs being omitted. snperin- § 2. The chief officer of the department shall be de- tendent. nominated the superintendent of the banking depart- ment. He shall be appointed by the governor, by and with the advice and consent o'f the senate, and shall hold Salary. his office for the term of three years. He shall receive an annual salary of five thousand dollars, to be paid quarterly, in the first instance, out of the treasury on the warrant of the comptroller. He shall employ from time to time the necessary clerks to discharge such duties as he shall assign them, whose compensation shall be paid to them monthly on his certificate, and upon the warrant of the comptroller, in the first instance, out of the treas- ury ; he shall appoint one of the said clerks to be his tendentT deputy, who shall possess the powers and perform the duties attached by law to the office of the principal dur- ing a vacancy in such office, and during the absence or inability of his principal. Within fifteen days from the time of notice of their appointments respectively, the superintendent and his deputy shall take and subscribe the oath of office prescribed by the constitution, and file the same in the office of the secretary of State, and the said officers shall be in all respects subject to the provis- ions of the sixth title of chapter five of the first part of the Revised Statutes, so far as the same may be applica- Oath of office. State of New York. 3 ble. And the said superintendent of tlie banking depart- Bond, ment shall give to the people of this State a bond in the penalty of fifty thousand dollars with two sureties to be approved by the comptroller and treasurer of this State, conditioned for the faithful discharge of the duties of his office, and the said superintendent shall not, either directly or indirectly, be interested in any bank or bank- ing association, or as an individual banker. Constructed from section two, chapter 164, Laws of 1851, as amended by section one, chapter 103, Laws of 1857. S 3. The superintendent of the banking department Powers of " -^ o ■ superin- shall possess all the powers, perform all the duties and be *™"i*'>*- subject to all the obligations and penalties transferred from the comptroller to, and conferred and imposed upon the said superintendent, by chapter one hundred and sixty-four of the laws of this State of the year one thousand eight hundred and fifty-one, and as specially provided by this act. Constructed from section three, chapter 164, Laws of 1851, the wording heing changed so as to cover all powers conferred on the superintendent by existing laws. § 4. The seal of office of said superintendent shall be seal.; the seal provided for said superintendent by chapter one hundred and ninety of the laws of eighteen hundred and eighty-two. Every certificate, assignment and convey- ance executed by the said superintendent in pursuance of any authority conferred on him by law, and sealed with his seal of office, shall be received in evidence, and may be recorded in the proper recording offices in the same manner and with the like efiect as a deed regularly ac- knowledged or proved before an officer authorized by law to take proof or acknowledgment of deeds ; and all copies 4 Bakkin'G Laws of the of papers in the office of the said superintendent, certi- fied by him, and authenticated by the said seal, shall in all cases be evidence equally and in like manner as the original. An impression of such seal directly on paper shall be as valid as if made on a wafer or wax. (As amended by chapter 282 of the Laws of 1883.) Constructed from section four, chapter 164, Laws of 1851. Rooms and 8 5. There shall be assigned to the said superintendent furniture. ° o r by the trustees of the State Hall suitable rooms therein for conducting the business of the said department, and the said superintendent shall, from time to time, furnish the necessary furniture, stationery, fuel, lights, and other proper conveniences for the transaction of the said busi- ness ; the expenses of which shall be paid on the certifi- cate of the superintendent, and the warrant of the comp- troller, in the first instance out of the treasury. Constructed from section six, chapter 164, Laws of 1851. how^de-^' § ^' ■^■'^ *^^ expenses incurred in and about the con- ^^^^ ' ducting the business of the said department, including the salary of said superintendent and clerks, shall be de- frayed and paid by the incorporated banks, banking associations, bankers, savings banks, and every corpora- tion and association required to report to the superin- tendent of the banking department under the provisions of section two hundred and nineteen of this act in whose behalf they are incurred, in such proportions as the said superintendent shall deem just and reasonable. The expenses incurred, and services performed, specially for any incorporated bank, banking association or banker, including the delivery of new banlc-bills for such as may be returned, and the destruction of the latter, shall be State of New Yoek. 5 charged to such incorporated banks, banking associations or bankers. If such charges are not paid after due notice, if charges are not the superintendent may apply the dividends on any stock, paid, or the interest on any bonds and mortgages in his hands deposited by the corporation, association, or banker, so neglecting to make the payment of such charges, with interest at the rate of six per centum ; and the moneys so received by the said superintendent on account of such charges, shall be deposited and paid by him into the treasury of this State, to reimburse all sums advanced from the treasury for such expenses ; and in case of there being no stocks, bonds or mortgages in the banking department deposited by such bank, association, or banker, then the said superintendent may maintain an action in his name of office against the delinquent bank, associa- tion, or banker, for the recovery of such charges, and the sums collected therein shall be paid into the treasury. Constructed from section seven, chapterl64, Laws of 1851, changed to con- form to section 1, chapter 324, Laws of 1874. 8 7. Neither the superintendent of the banking de- No com- " "^ " pensation partment, nor any clerk or person employed in his office iervlcesf shall take or receive, directly or indirectly, any compen- sation or pay for any services or extra services rendered in the banking department, other than the compensation allowed by law, and any person violating this provision shall be deemed guilty of a misdemeanor. Constructed from the last clause of section seven, chapter 164, Laws of 1851. § 8. It shall be the duty of either the president orExamina- cashier of every bank and banking association, and of I^^J^fj*!! every individual banker, having securities deposited in lation. the office of the superintendent of the banking depart- 6 Bankin-g Laws ob the ment of this State, once or more during each fiacal year, and at such time or times during the ordinary business hours as said officer, banking association or banker may select, to examine and compare such securities with the books of said department, and if found correct, to exe- cute to the superintendent a receipt setting forth in the same the different kinds and the amounts thereof, and that the same are in tlie possession and custody of the superintendent at the date of such receipt. Moa'may' ^^ ^^^^ °^ ^^'^ inability of an individual banker to make by author- such examination, he shall make the same through an ized agents. authorized agent, appointed by him in writing, whose receipt shall have the same force and validity as if exe- cuted by him in person. Constructed from section two, chapter 189, Laws of 1857. In case of § 9. If any bank, banking association, or individual refusal to c j J o J examine, banker, shall refuse or neglect to make such examination comp- during the i.scal year aforesaid, the comptroller, secretary appoint of State, and the superintendent of the banking depart- ment shall appoint some suitable and discreet person as agent for such bank, banking association, or individual banker, who shall have neglected or refused to make the age'iTt?* aforesaid examination ; and such agent shall make such examination, and if the securities so held by the superin- tendent shall be found to agree with the books of the de- partment, shall execute the receipt before mentioned, and the same shall be of like force or validity as if executed by the president or cashier of the bank, banking associa- tion, or the individual banker, or by an agent by him ap- pointed ; and it shall be the duty of such bank, banking association, or the individual banker, to pay on demand to such person so appointed, and making such examina- State of New York. 7 tioD and executing a receipt as aforesaid, such compensa- tion therefor as the superintendent shall certify to be just and reasonable. Constructed from section two, chapter 189, Laws of 1857. § 10. The superintendent of the banking department Unclaimed is hereby directed to pay into the treasury of the State into* ^^' treasury. all balances of monejr remaining in his hands unclaimed for six years from the date of such deposit, to be applied to the current expenses of the banking department. Constructed from, section two, chapter 236, Laws of 1859. § 11. livery banking association and individual banker Banks; 6tjC . I LO D6 carrying on banking business, or who shall hereafter |"p^^?n_''° teDdent. carry on banking business under the laws of this State, shall be subject to the inspection and supervision of the superintendent of the banking department. Constructed from section eleven, chapter 363, Laws of 1840, superinten- dent heing substituted for bank commissioners. CHAPTER II. Examinations of Banks, Banking Associations and Individual Ba^kees. Section 12. Examinations by superintendent or agent. Expenses. Exam- iner not to be receiver.* 18. Agent to examine on oath. 14. Attendance and testimony of witnesses. 15. Publication of report. 16. Attorney-general to prosecute for violations of provisions of this act. 17. Examination in case of impaired capital. 18. Examination as to payment of capital. 19. Court may order examination by referee. 8 12. It shall be the duty of the superintendent of thoExamina- ° ■/ r tionsby banking department, in his discretion, if he shall deem it tendeiTt'or agent. * As amended by chapter 47, Laws of 1884. 8 Banking Laws of the proper, to personally examine tlie books, papers and afEairs of any bank, banking association, individual banker or corporation required to report to him by section two hundred and nineteen of this act ; or said superintendent may at any time, in his discretion, designate some compe- tent person to make such examination. Th« person so designated shall forthwith examine fully into the books, papers and affairs of such bank, banking association, indi- vidual banker or corporation, and report to the superin- tendent, on oath, the result of such examination. A copy of said report may be forthwith published in the manner prescribed in section twenty of this act, in respect Expenses, to the publication of quarterly reports. The expense of every such examination, if any, shall be paid by the cor- poration examined in such amount as the superintendent shall certify to be just and reasonable. Whenever such examination shall be made by the superintendent in per- son, or bj' one or more of the regular clerks in his de- partment, no charge shall be made except for necessary nofto'Sr traveling and other actual expenses. No person so des- ignated by the superintendent, as provided by this sec- tion, shall be appointed receiver of any bank, banking association, individual banker or corporation, whose books, papers and affairs he shall have examined pursu- ant to the provisions of said section. (As amended by chapter 47, Laws of 1884.) Constructed from section three, chapter 419, Laws of 1847. Bxamin- § 13. The person designated by the superintendent of oati?.''* the banking department under this act to examine the books, papers and affairs of any bank, banking associa- tion or individual banker, shall take and file in the office of the clerk of the county where he resides the oath of State op New York. 9 office prescribed in the constitution ; and he shall have authority to examine, on oath, any individual banker. May ex- and the officers, agents, partners and clerks of such ^^^^^ °^- banker, and of any bank or banking association, touching the matters which he shall be directed to inquire into ; and an}"^ willful false swearing in any such examination shall be perjury. And when directed by the said super- Perjury, intendent, such person shall inquire whether any banker transacts the business of banking at the city, town or to see that business Is village where the circulating notes of such individual "^9°® banker purport to have been issued and dated ; and by'law! whether any bank or banking association transacts the business of banking at the place designated in its charter or certificate of association ; and whether such banking business is conducted in the manner prescribed by law. Constructed from section one, chapter 242, Laws of 1854. S 14. Such person shall have power to summon, in Maysum- " men any writing, under his hand, any inhabitant of the county in o'f'iounty* 1 • 1 • • 1 t'* testify. which he may be conducting the inquiry, to appear be- fore him and testify in relation to the same. If the party appear'o^ so summoned shall refuse or neglect to appear at the time and place specified in such summons, or, having appeared, shall refuse to be sworn, or shall refuse to answer any pertinent and legal question, he shall forfeit the sum of one hundred dollars, to be sued for and recovered, with costs, by the superintendent of the banking department, in his name of office, and to be paid into the treasury to defray the general expenses of the banking department ; and upon such neglect or refusal being duly proved, by the person conducting such inquiry, Before any justice of the supreme court, if such justice be satisfied that the party so neglecting or refusing ought to be examined 10 Banking Laws of the touching the matters of such inquiry, he shall, by war- rant, commit such party to the jail of the county, there to remain in close custody until he shall submit to appear, or testify, or answer, as the case may require. Constructed from section two, chapter 242, Laws of 1854. Pubiica- 8 15. Whenever the superintendent shall deem it tion of ° report. proper, a copy of any such report shall be published in the State paper and in at least two daily newspapers in the city of New York. Constructed from section four, chapter 242, Laws of 1854. Should 8 16. In case any bank, banking association or individ- bank.etc, " j j t^ subm?tto ual banker shall refuse to submit its books, papers and examina- . • . j tion. concerns to the inspection of an ■ examiner appointed as aforesaid, or whose officers shall refuse to submit to be examined upon oath touching the concerns of such bank, banking association or individual banker, or which shall be found to have violated any law of this State binding upon such bank, banking association or individual banker, the superintendent may refer the same to the attorney- general, whose duty it shall then become to institute such proceedings against such bank, banking association or individual banker, as are now authorized in case of in- solvent corporations. Constructed from section twelve, chapter 363, Laws of 1840, and section three, chapter 456, Laws of 1871. Bxamina. *§ 17. Whenever it shall appear from any report of tion in paired* ''"' ''^'^7 banking association or individual banker, or the super- intendent shall have reason to believe that the capital of such bank is reduced, by impairment or otherwise, below the amount required by law, or by its certificate or articles * Capital stock may be reduced to make good impairment, see opinion of attorney -general, page 432. State of New Yoek. 11 of association, it shall be the duty of the superintendent, and he shall have power to require such banking associa- tion or individual banker to make good the deficiency so appearing; and, to give efEect to such requisition, he shall have power to examine, or cause to be examined, any such bank, to ascertain the amount of such impair- ment or reduction of capital, and whether the deficiency has been made good in compliance with his requisition- ; and if any such banking association or individual banker Penalty •' ° for neglect shall neglect for ninet}' days after such requisition hasgood*de- flciency. been made to make good the deficiency so appearing or found to exist, it shall be the duty of the superintendent to refer the same to the attorney-general, whose duty it shall then become to institute such proceedings against such banking association or individual banker as are now authorized in the case of insolvent corporations. Constructed from section four, chapter 456, Laws of 1871. Assessment against shareholders to make good deficiency, hovr enforce able. See chapter 191, Laws of 1S82, page 223. *8 18. Whenever any banking association or individual Examina- ° ''. ° tion as to banker shall file with the superintendent of the banking of capital, department the requisite certificate prior to commencing the business of banking under the laws of this State, it shall be the dut}' of the superintendent, and he shall have power before such bank shall be authorized to commence business, to examine or cause an examination to be made in order to ascertain whether the requisite capital of such bank has been paid in cash ; and when upon such exam- ination, or upon the presentation of evidence satisfactory * Individual hankers not required to furnish evidence of payment of i specified amount as capital prior to organization, see opinion of attorney- general, page 430. For blank form of afiSdavit of payment of capital, see page 266. 13 Banking Laws of the to him, it shall appear that the requisite capital has been in good faith subscribed and paid in, in cash, he nStto^be ^^^^^ i^^'^'^ ^^^ certificate to that effect in form, duly without authorizinar such bank to commence business; and it superin- cmmcate ^^^^^ ^e unlawful for any banking association or indi- effeot. vidual banker to commence the business of banking until such certificate and authority liave been granted. Constructed from section three, chapter 456, Laws of 1871. oourtto § 1^- Upon the application of creditors, or sharehold- amination. ers, of any banking association, whose debts or shares shall amount to one thousand dollars, and stating facts, verified by affidavit, the supreme court may, in its dis- cretion, order a strict examination to be made by a ref- eree, of all the affairs of such association, for the purpose of ascertaining the safety of its investments, and the prudence of its management; and the result of every maTbe such examination, together with the opinion of the ref- publlshed. eree, and of the supreme court thereon, shall be pub- lished, in such manner as the supreme court shall direct, which shall make such order, in respect to the expenses of such examination and publication, as the court may deem proper. Constructed from section twenty-five, chapter 260, Laws of 1838. CHAPTER III. Bepoets to and by thb Supeeintendent. Sbctiok 20. Quarterly reports. Contents. Publication. 21. Examination and penalty on failure to report. 22. Report and summary, expense of publication. When neglect to report forfeits charter. 23. Quarterly reports by individual bankers. Penalty. 24. Classification and publication of aostracts. State of New York. 13 Section 25. Publication as to unclaimed moneys. 26. Contents of statements as to such moneys. %1. Annual report of superintendent. 28. Keport of association or banker to be on oath. 8 20. It shall be the duty of the superintendent of the Duty of ° ''I- superlD- banking departnaent to fix upon and determine a day in a™ o*° quarterly respect to which the reports of the character hereinafter reports, specified, of incorporated banks, banking associations and individual bankers shall be made ; and the said superin- tendent shall, at least once in each quarter of a year, fix and designate some Saturday in each quarter, in respect to which the said reports shall be made. Immediately after each determination of such Satur- day, the officer hereinbefore named shall cause notice thereof to be published daily for six successive days in such newspaper published in the city of Albany as shall, for the time being, have the publication of legal notices, under the act entitled "An act to provide for the public printing," passed March fifth, eighteen hundred and forty-six, or shall serve a copy of such notice upon each incorporated bank, banking association and individual banker in the State, by delivering the same to some officer or clerk thereof, at their respective places of busi ness, or by depositing the same in the post-ofiiee, directed to each of such banks, banking associations and individ- ual bankers, or some officer thereof, at their places of business respectively. It shall be the duty of every incorporated bank, bank- Reports to superln- ing association or individual banker in the State, on or indent, before the first days of February, May, August and November of each year, to make and transmit to the superintendent a quarterly report, which report shall be made on the oath of the president and cashier, and shall 14 Banking Laws of the contain * a true statement of the condition of the bank, banking association or individual banker making such report, before the transaction of any business on the morning of the day specified in the notice of the super- intendent, next preceding the date of such report, in respect of the following items and particulars, namely : Items to Loans and discounts, over drafts due from banks, due be re- ported. fi-Qiji the directors of the bank or banking association making the report, due from brokers, real estate, specie, cash items, stock and promissory notes, bills of solvent banks, bills of suspended banks, loss and expense account, capital, circulation (distinguishing that received from the superintendent from the old outstanding bills), forfeits, amount due to banks, amount due to individuals and corporations other than banks, amount due to the treas- ury of the State, amount due to commissioners of canal fund, amount due to depositors on demand, amount due Report to ^ot included under either of the above heads. And it be pub- lished, shall be the duty of the superintendent to publish such reports together in the newspaper published in the city of Albany, in this section before named, accompanied with a summary of the items of capital, circulation and deposits, specie and cash items, public securities and pri- vate securities; and the separate report of each bank, banking association and individual banker shall be pub- lished in a newspaper published in the county ; if a news- paper is published in the city or town in wliich any bank is situated, such publication shall be had in such paper. All willful false swearing in respect to the reports in this section provided for shall be deemed perjury and * Superintendent may require a complete disclosure of the affairs of the bank, see opinion of atlorney-general, page 424. State of New York. 15 subject to the punishment prescribed by law for that offense. Constructed from section one, chapter 419, Laws of 1847. § 21. In case of neglect to make such report within Bxamina- ° o r tion and five days from the mailing of the notice, designatins; f^?ure^to° said day upon which such report shall be made, it shall be the duty of the superintendent to cause the books, papers and affairs of the bank, association or bankers so neglecting to be examined as directed by section twelve of this act; and the reasonable expenses of .such examina- tion, to be certified by the superintendent, shall be charged to the bank, association or banker so neglecting, and shall be collected in the manner herein prescribed in respect to other charges against them ; and it shall also be the duty of the superintendent, in case of the failure or neglect of any bank, banking association or individual banker to make said report within the time above mentioned to prosecute the same in any court of record and recover the sum of one hundred dollars for Penalty, *1CI0. such neglect or refusal ; and the money so recovered shall. be paid into the treasury of this State, to be used for the purpose of defraying the miscellaneous expenses of the bank department. Constructed from section nine, chapter 419, Laws of 1847, as amended by section three, chapter 189, Laws of 1857, as amended by section nine, chapter 50, Laws of 1875. § 22. The superintendent shall publish the reports and Reports and sum- summary required by section twenty of this act, together ^^bUshed? in one paper, on or before the twenty-fifth day of August, November, Tebruary and May in each year, and the ex- pense of snch publication shall be defrayed by a percent- age, assessed upon the capital stock of all the banks and banking associations and individual bankers doing busi- 16 Banking Laws of the ness under the laws of this State, in the State ; and if any such bank, banking association, or individual banker shall fail to furnish to the superintendent its quarterly Penalty, rejport in time for such pubhcation, it shall forfeit and failure to pay to the superintendent the sum of one hundred dollars report in ^ "^ ^ *"°®" to be applied by him to the payment of the expense of publisliing the quarterly reports ; and if any bank, bank- t^o qSar-' ing association or individual banker shall neglect or re- tersfor- , , , . feitschar- fuge to make the quarterly report required by section twenty of this act, for two successive quarters, it shall forfeit its charter (if an incorporated hank) and its privi- leges as a banking association or individual banker; and every such bank, banking association and individual banker may be proceeded against, and its affairs closed in the manner now required by law in case of an insol- vent bank or banking association. Constructed from section two, chapter 419, Laws of 1847. Quarterly 8 23. Each and every individual banker, doing busi- reports by " •' ;> o backers""' ness under the general banking laws of this State, shall state in his quarterly reports whether any person or per- sons, and who are interested with such individual banker, directly or indirectly, in the securities deposited with the superintendent for the circulating notes obtained by such individual banker, or in the business of circulating said notes, or the benefits or advantages thereof ; and if it shall appear from such report that any other person is so inter- Penaity ested with said banker, and in case two successive reports for failure to report, of Said banker shall not contain such statement, or if he omits twice in succession to make such quarterly reports, such banker shall forfeit one thousand dollars for each and every omission to make such statement, or to file such report as aforesaid, to be sued for and recovered by State of New Yokk. 17 the attorney-general, in the name and for the benefit of the people of this State. Constructed from section two, chapter 281, Laws of 1844, extended to con- form to section five, chapter 242, Laws of 1854. § 24. In the publication of the abstracts of the quar- S'^^'f- . terly returns of individual bankers, the superintendent of rep^orts?* the banking department shall arrange them in a separate class, and shall specify the name and place of business of each, and the names and residence of the general partners. Constructed from section seven, chapter 242, Laws of 1854. § 25. Every banking company or association now or statement hereafter incorporated or organized, or doing business diT™|nds to be pub- under any general or special law of this State, and every Ushed. individual banker, on or before the first day of Septem- ber next, and annually thereafter, shall cause to be pub- lished for six successive weeks in one public newspaper printed in the county in which such company, association or individual banker may be located, and in the State paper, a true and accurate statement verified by the oath of the cashier, treasurer, or presiding officer, of all de- posits made with said company or association, and of all dividends and interest declared and payable upon any of the stock, bonds or other evidence of indebtedness of said company or association, which at the date of such state- ment shall have remained unclaimed by any person or persons authorized to receive the same for two years then next preceding. Constructed from section one, chapter 262, Laws of 1835, as amended by section one, chapter 437, Laws of 1849. S 26. Such statement shall set forth the time that every statement, ■^ •' what to such deposit was made, its amount, the name, and the"""'^'"' residence, if known, of the person making it, the name 3 18 Banking Laws of the of the person in whose favor the dividend may have been declared, or interest accrued, its amount, and upon what number of shares, and on what amount of stock, bonds, or other evidence of indebtedness, of any such company, association or individual banker. Constructed from section two, chapter 437, Laws of 1849. Annual § 27. It shall be the duty of the superintendent of the report of tenleiS;" banking department to report annually to the legislature, at the commencement of its first session : 1. A summary of the state and condition of every incorporated bank, banking association and individual banker, from whom reports have been received the pre- ceding year, at the several dates to which such reports refer, with an abstract of the whole amount of banking capital returned by them, of the whole amount of their debts and liabilities, specifying particularly the amount of circulating notes outstanding, and the total amount of means and resources, specifying the amount of specie held by them at the times of their several returns, and such other information in relation to said banks, associa- tions and bankers, as in his judgment may be useful ; 2. A statement of the banking associations and bank- ers whose business has been closed during the year, with the amount of their circulation redeemed and the rate of such redemption per centum and the amount outstanding ; 3. To suggest any amendment to the laws relative to banking by which the system may be improved and the security of bill holders and depositors may be increased ; 4. To report the names and compensation of the clerks employed by him, and the whole amount of the expenses of the department during the year, and the amount, if any, for which the treasury shall be in advance ; such State of New York. 19 report shall be made by or before the last day of the year, and the iisual number of copies for the use of the legislature, shall be printed in readiness for distribution on the meeting of the legislature by the printer employed to print legislative documents; and two hundred and iifty copies shall be printed for the use of the depart- ment, the expense of which shall be charged among the general expenses of the department. Constructed from section eleven, chapter 164, Laws of 1851. § 28. Every report directed to be made, by any law of Reports, ■ etc., to be this State, from such association or individual banker, °° *»*"'• shall be verified by the oath of the president and cashier of such association, or such individual banker, that the usual business of said association, or banker has been transacted at the location* required by this act, and not elsewhere. Constructed from a portion of section one, chapter 340, Laws of 1848. CHAPTEE IV. General Provisions relative to Banks, Banking Associations and Individual Bankers. Section 29. Formation of associations. 30. Certificate to be filed. Its contents. 31. Certificate may be used as evidence. 32. Statement of residence. Penalty for neglect. 33. Notice of change of residence. 34. Certificate of change in any particular. 35. General powers of association. 36. Certain corporations may hold stock. 37. Banks, associations and bankers may hold certain public securi- ties. * Business to be transacted at banking-house only, see opinion of attorney- general, page 428. To contrary effect, page 429. 20 Banking Laws of the Section 38. Associations may purchase, hold and convey real estate for cer- tain purposes. 89. Increase of capital and associates. 40. If portion of capital withdrawn no dividends. 41. Keduction of capital. i2. Notice of intention to reduce capital. 43. Examination in case of such notice. 44. Certificate of reduction to be filed and published. 45. Liability of stockholders on such reduction. 46. List of names of stockholders to be filed. 47. Shares deemed personal. How transferable. 48. Associations authorized to consolidate. 49. Proceedings to consolidate. 50. Consent of two-thirds of stockholders. Examination. 51. Certificate of amount of stock. 52. Publication of same. 53. Consolidation perfected. 54. Effect of consolidation on pending legal proceedings, 55. Liability of stockholders not changed. 56. Stockholder not assenting to consolidation. 57. Associations subject to certain provisions of Revised Statutes. 58. Quorum for transaction of business. 59. Contracts and legal proceedings. 60. Actions against the president. 61. Shareholders may sue and be sued by president. 62. Set-offs in such suits. 63. Discount, deposit and circulation. Location of business. 64. When unlawful to sell business. 65. Business continued by legatee or heir. 66. Deposit of one thousand dollars. Action by superintendent. 67. United States and State stock to be deposited. 68. Interest six per cent. Usury. Forfeiture. 69. Associations and National banks on equality as to interest. of'banks"" § ^^- ^^y number of persons may associate to estab- lish offices of discount and deposit upon the terms and conditions, and subject to the liabilities prescribed in this act, and the acts amendatory thereof, but the aggre- gate amount of the capital stock of any such association or bank shall not be less than one hundred thousand dollars ; provided, however, that banks with a capital of not less than fifty thousand dollars may be organized in any city, village or place, the population of which does not exceed thirty thousand inhabitants, and with the approval of the superintendent of the banking depart- State of New York. 21 ment, banks with a capital of not less than twenty-five thousand dollars may be organized in any village or place, the population of which does not exceed six thou- sand inhabitants. Constructed from section one, chapter 122, Laws of 1879, amending sec- tion fifteen, chapter 260, Laws of 1838, as amended by chapter 126, Laws of 1874. *§ 30. Such persons, under their hands and seals, shall ^t'e to be make a certificate which shall specify : to contain. f 1. The name assumed to distinguish such association, and to be used in its dealings ; :j:2. The place where the operations of discount and deposit of such association are to be carried on, designat- ing the particular city, town or village ; §3. The amount of the capital stock of such association, and the number of shares into which the same shall be divided ; ||4. The names and places of residence of the share- holders, and the number of shares held by each of them respectively ; Tf5. The period at which such association shall com- How proved, mence and terminate ; which certificate shall be proved anTmld. or acknowledged and recorded in the office of the clerk *For instructions in organization of banking associations, see page 266, For blank form of certificate of association, see page 263. ■t Individual bankers not authorized to use artificial corporate names, see opinion of attorney-general, page 430. JTo change business location of association, see opinion of attorney- general, page 449. Business to be transacted at banking house only, see opinion of attorney- general, page 426. To contrary effect, page 429. § Individual bankers not required to furnish evidence of payment of a ■ specified amount of capital prior to organization, see opinion of attorney- general, page 430. 1 Liability of shareholders, see opinion of attorney-general, page 433. 1 Extension of term of corporate existence, see opinion of attorney-gen- cral, page 445. 23 Banking Laws of the of the county where any office of such association shall be established, and a copy thereof filed in the office of the superintendent of the banking department. Constructed from section sixteen, chapter 260, Laws of 1838, as amended by section one, chapter 185, Laws of 1854. To change corporate name of association, see chapter 518, Laws of 188T page 22V. To extend term of corporate existence, see chapter 937, Laws of 1867, page 219. To change business location of association, see chapter 517, Laws of 1887 page 224. , certifi- § 31. The certificate required by the last preceding evidlnoeT section to be recorded and filed in the offices of the filed. county and superintendent of the banking department, as aforesaid, or copies thereof, duly certified by either of those officers, may be used as evidence in all courts and places for and against any such association. Constructed from section seventeen, chapter 260, Laws of 1838, as amended by section one, chapter 185, Laws of 1854. Individual * S 32. Every individual banker who has not already banker to u ./ j tiflct°e^of -i of stock- change or lessen the liability of the stockholders of any b°ifk un"'' ,,. .. .. ,.. .1 changed. banking association or corporation reducing its capital stock under its provisions, to the billholders or other creditors thereof, or any indebtedness or engagement, now existing, or that may so exist, either absolutely or * Sections 228 to 231 inclusive, make ample provision for the reduction of capital stock of corporations required to report, by what, prior to 1882, was chapter 324, Laws of 1874. 28 Banking Laws of the contingently, against such association or corporation prior to, or at the time when such reduction shall take place, or by which the rights, remedies or security of the then existing creditors shall be weakened or impaired. Constructed from section fire, chapter 50, Laws of 1875. List of 8 46. The president and cashier of every banking asso- names of ^ ho!dOTsto ciation formed pursuant to the laws of this State shall and filed, at all times keep a true and correct list of the names of all the shareholders of such association, and shall file a copy of such list in the office of the clerk of the county where any office of such association may be located, and also in the office of the superintendent, on the first Mon- days of January and July, in every year. Constructed from section thirty, chapter 260, Laws of 1838. Shares to 8 47. The shares of said association shall be deemed be per- ^ property, personal property, and shall be transferable on the books of the association in such manner as may be agreed on in the articles of association ; and every person becoming a Right of shareholder by such transfer shall, in proportion to his holders, gjiares, succeed to all the rights and liabilities of prior No change In articles shareholders : and no change shall be made in the articles to Impair ' ° creditors, of association by which the rights, remedies or security of not dis- •. , , solved by its existing creditors shall be weakened or impaired, hoidera!' Such association shall not be dissolved by the death or insanity of any of the shareholders therein. Constructed from section nineteen, chapter 260, Laws of 1838. Authority § 48. Any two or more banking associations organ- ***■ ized under the general banking laws of this State, and located in the same city, village or town, are hereby authorized to consolidate the same into a single associa- State of New York. 29 tion, to be located in the same place, in the manner here- inafter provided. Constructed from section one, chapter 422, Laws of 1862. § 49. The directors of the said association may enter Proceed- •' inss to into an agreement under their respective corporate seals, aate.°"' for the union or consolidation of the said associations, prescribing the terms and conditions thereof, the mode of carrying the same into effect, the name and diiration of the new association, the number of directors, the names of the persons to constitute the first board of directors, the time and place of holding the first election of directors, the manner of converting the shares of each of said associations into the shares of the new association, with such other details and provisions as they may deem expedient, not inconsistent with the provisions of this act. Notice of the intention to consolidate said associa- tions shall be served personally or by mail on each stockholder of each of said associations, at least ten days previous to entering into said agreement. Constructed from section two, chapter 422, Laws of 1862. § 50. The written consent of stockholders, owning at consent of stock- least two-thirds in amount of the capital stock of each of '^^''^^'s- said associations, shall be requisite to the validity of said agreement. Upon the presentation of* the superintendent of the banking department, of the said agreement duly proved or acknowledged, together with satisfactory proof by affidavit or otherwise, of the assent thereto of stock- holders owning two-thirds in amount of the capital 'stock of each of said associations so proposing to consolidate, and of the service of notice upon each stockholder, as * So in original. 30 BANKHiTG Laws of the aforesaid, the said superintendent shall, within a reason^ able time thereafter, make or cause to be made an exam- ination of the books, property, effects and liabilities of such association ; upon which examination the officers thereof may be examined on oath as to the debts, liabili- ties, property and effects of such associations respectively. donTy ^ From the result of such examination the said superin- superin- teudent. tendent shall determine the value, in his judgment, of such property and effects above and beyond the debts and liabilities aforesaid, and certify the same in writing, and the amount so determined and certified shall be thereafter the capital stock of such consolidated banking association. Coustructed from section three, chapter 422, Laws of 1862. to be^re*** § 51. The determination and certificate in writing to corded. be made by the superintendent, of the amount at which the capital stock of any banking association has been fixed under this act, shall be recorded in the office of the Filed in clerk of the county in which such banking association partment. shall be located ; and a certified copy thereof filed in the banking department of the State of New York. See note to succeeding section. Certiflcate § 52. The determination and certificate provided for to be '^ pubushed. jjj ^j^g j^g^. preceding section shall be published by the superintendent once a week for six weeks successively in the State paper, and at least one newspaper in the county where such association shall be located. Sections 51 and 52 are constructed from section five, chapter 422, Laws of 1862. «o°soiida- § 53. Upon the recording of the said agreement and teoted. certificate, the said consolidated associations shall be and become a single banking association, in accordance with State of New York. 31 the said agreement and certificate, with the same fran- chise, rights, powers and privileges, and subject to the same duties, conditions and hmitations, as the several constituent associations; and such consolidated associa- tion shall be vested with all the estate, property, credits and effects of the constituent associations, without deed or other transfer, and shall be liable for all their con- tracts, debts, obligations and liabilities ; and the separate existence and operation of such constituent associations shall thereiipon cease and determine. Constructed from section six, chapter 422, Laws of 1882. § 54. No action or other proceeding pending before saving any court or tribunal, in which either of the constituent JSg'JSts. associations may be a party, shall be deemed to have abated or been discontinued by reason of their consolida- tion ; but the same may be prosecuted to final judgment and execution in the same manner as before such consoli- dation, or the said new association, by order of the court in which such proceeding may be pending, may be sub- stituted as a party in place of either of the original asso- ciations, in any stage of such proceedings. Constructed from section seven, chapter 422, Laws of 1862, § 55. Nothing in the foregoing provisions for consoli- Liability dation shall in any way change or lessen the liability of ° *'^*'^- the stockholders of any banking association consolidating their capital stock thereunder, to the billholders or other creditors therefor; or any indebtedness or engagement now existing or that may so exist, either absolutely or contingently, against such association prior to or at the time when such consolidation shall take place; or by which the rights, remedies or security of the then exist- ing creditors shall be weakened or impaired. Constructed from section eight, chapter 422, Laws of 1862. 33 Banking Laws of the hoidermay § ^^- ^^ ^Dj Stockholder in either of the associations His stock availing itself of the foregoinsr provisions for consolida- bought. ^.JQjj^ ^-jr^Q g]ja,u not have assented to such consolidation, shall, within twenty days after the agreement and certi- ficate hereinbefore mentioned shall be recorded in the clerk's office of the county in which such associations are located, object in writing to said consolidation, and demand payment for his stock, such consolidated asso- ciation shall, within three months from the fihng of such dissent, pay to the dissenting stockholder the value of his stock, as determined in the certificate of the superin- tendent of the banking department aforesaid ; and upon payment so made by the said association, the interest of said stockholder in the property and effects of said asso- ciation shaU cease, and the said stock may be held and disposed of by the said association for its own benefit. Constructed from section nine, chapter 422, Laws of 1862. Banking 8 57. Every banking association which has been formed asaocia- ^ ./ o subject" to* 01" organized under the provisions of the act, entitled sections 195 to 213. "An act to authorize the business of banking," passed April eighteen, eighteen hundred and thirty-eight, or of any act amending the same, or which shall hereafter be organized under this act, shall be subject to the provis- ions of sections one hundred and ninety-five to two hun- dred and thirteen inclusive of this act. Constructed from section one, chapter 160, Laws of 1847. Number of 8 58. In all cases where the articles of association of directors " tute'aquo- any banking association do not prescribe as to the num- rum. ber of directors necessary to constitute a quorum, and make no provision for determining the same, such bank- ing association may, by its directors, declare and fix the number of directors necessary to be present to constitute State of New York. 33 a quorum for the transaction of business, which number shall not be less than five, with the same effect as if the same was prescribed in the articles of association of such banking association. Constructed from section one, chapter 22, Laws of 1863. § 59. Contracts made by any such association, and all Contracts notes and bills by them issued and put in circulation as p^fdent or vice- money, shall be signed by the president or vice-president president and cash- ier. and cashier thereof ; and all suits, actions, and proceed- ings, brought or prosecuted by or on behalf of such asso- ciation, may be brought and prosecuted in the name of the president thereof; and no such suit, action, or pro- ceeding shall abate by reason of the death, resignation Action win I _ not abate or removal from office, of such president, but the same *•? -■ it shall be the duty of such bank, banking association or individual banker, or the trustees or officers thereof, to procure the attendance of an agent to witness the count- ing, destruction and burning of such circulating notes, at the banking department, and sign a certificate thereof. In case the individual banker, or the trustees or oflScers of any bank or banking association returning circulating notes to the bank department for destruction and burn- in ease of ing, shall refuse or neglect to appoint or procure attend- f allure, tenl'^nt'to ^°^® ^^ ^^ agent to witness the counting and burning appo n . |-]jgj.gQf -^jrithin ten days after the receipt of the bills at the banking department, it shall be the duty of the super- intendent to select and appoint some indiflEerent person, who shall, as the agent of such bank, banking associa- tion, banker or trustee, witness and certify the counting and burning thereof ; and it shall be the duty of such bank, banking association, banker or trustee, forthwith to pay on demand to such person so appointed, witnessing and certifying as aforesaid, such compensation therefor as the superintendent shall certify to be just and reasonable. Constructed from section four, chapter 189, Laws of 1857. When § 80. It shall be the duty of the superintendent of the plates to be banking department, and he is hereby authorized and directed to destroy or cause to be destroyed all bank note State of New Yoke. 45 plates in his custody, of banks, banking associations or individual bankers, which have failed or given notice of closing their business ; and also all bank note plates in his custody that are not used, and any impressions which may be on hand made therefrom; and hereafter, when- ever any bank, banking association or individual banker shall fail, or discontinue the business of banking, it shall be the duty of the said superintendent to destroy, or cause to be destroyed, all plates and impressions belonging to such bank, banking association or individual banker, and include in his next annual report a statement of the plates so destroyed. It shall be the duty of every public counter- feit notes officer into whose hands shall come any counterfeit bank t" be'sur-^ note plate, or other device for counterfeiting bank notes, to superin- ^ _ _ tendent. or any counterfeit or spurious bank notes, immediately after using them when necessary in evidence against the parties implicated, to surrender the same to the superin- tendent of the banking department to be destroyed under his supervision, and it shall be the duty of the superintendent to destroy all such plates, devices or notes superin- tendent to thus surrendered to him, in the same manner as he is pf|*es''eto now authorized to do in case of banks whose charters have expired or have become insolvent, and to report the same to the legislature in his annual report. Constructed from section five, chapter 189, Laws of 1857, and section four, chapter 236, Laws of 1859, combined. § 81. It shall be the duty of the superintendent to re- Mutilated ceive mutilated circulating notes issued by him, and to chaifged. deliver in lieu thereof other circulating notes to the same amount. Every person who shall mutilate, cut, deface, ?®°^'*?, disfigure or perforate with holes, or shall unite or cement bank^ notes. together, or to any other thing, any bank-bill, draft, note Banking Laws of the Powers of attorney to be given to owners to receive dividends on trust funds. When to be re- voked. Stocks may be changed or trans- ferred. When in- terest and dividend may be retained. or Other evidence of debt issued by an incorporated bank in this State, or shall cause or procure the same to be done with intent to render such bank-bill, draft, note or other evidence of debt unfit to be reissued by said bank, shall, upon conviction, forfeit fifty dollars to the corpora- tion or banking association injured thereby. Constructed from section five, chapter 363, Laws of 1840, and section one, chapter 315, Laws of 1833, combined. § 82. The superintendent may give to any person or association of persons transferring stock in pursuance of the provisions of this act, powers of attorney to receive interest or dividends thereon, which such person or asso- ciation may receive and apply to their own use ; but such powers may be revoked upon such person or association failing to redeem the circulating notes so issued, or when- ever, in the opinion of the superintendent, the principal of such stock shall become an insufficient security ; and the said superintendent, upon the application of the owner or owners of such transferred stock in trust, may, in his discretion, change or transfer the same for other stocks of the kinds before specified in this act, or may re-transfer the said stocks, or any part thereof, upon receiving and canceling an equal amount of such circulating notes de- livered by him to such person or association, in such manner that the circulating notes shall always be secured in full. Constructed from section five, chapter 260, Laws of 1838, changed to con- form to chapter 247, Laws of 1879. § 83. Whenever the securities deposited for the re- demption of circulating notes shall, in the opinion of the superintendent, become insufficient for that purpose, he may receive the dividend on all stocks, and shall deposit the same in some safe bank or banking association in the State of New York. 47 city of Albany, in his name, in trust for the association or banker to whom the same may belonsr : the deposit to Duty of "' ° ' ^ superln- be made on such terms and at such rate of interest as the *®°'^®'"- superintendent may deem most conducive to the interest of such association or banker, and to be withdrawn and paid over, whenever, in the opinion of the superintend- ent, the securities of such association or banker shall be sufficient to warrant it. Constructed from section seven, chapter 863, Laws of 1840, changed to conform to chapter 247, Laws of 18T9. § 84. The pubUc debt to be deposited with the super- ^«™/U^f| intendenb by any such person or association, as security dem^ption of notes. for circulation, shall be held by said superintendent ex- clusively for the redemption of the bills or notes of such person or association put in circulation as money, until the same are paid. Constructed from section twelve, chapter 260, Laws of 1838, changed so as to exclude the deposit of $1,000 as pledge of good faith, etc., required by section one, chapter 202, Laws of 1880. § 85. If it shall appear from any examination made atpo"'"!. the instance of said superintendent, that any bank, bank- Snsound • • ■ T •! T 1 1 • . 1 or doing ms: association or individual banker is m an unsound or business ° elsewhere unsafe condition to do banking business, or that the busi- {awful' ness of bankinff is not transacted by such bank, associa- notes and interest on tion or banker at the place where said circulating notes j^'^jewith- are dated and purport to be issued, or is not transacted in the manner prescribed by law, it shall be the duty of the superintendent to withhold and refuse to issue and deliver any registered notes to such bank, association or banker, and to retain the interest on all securities held in trust for such bank, association or banker, until such time as he shall be satisfied that such bank, association or banker is in a sound and safe condition to do a banking 48 Bankijstg Laws of the business, and that the business of banking is transacted by such bank, association or banker, at the place where said circulating notes are dated and purport to be issued. Constructed from section three, chapter 242, Laws of 1854. Offices of I 86. Every moneyed corporation in this State having "°°' banking powers, and issuing bills or notes of circulation, and every banking association and individual banker carrying on banking business under the laws of this State, except those whose place of business is in the cities of New York, Albany, Brooklyn or Troy, and who have not already made such an appointment, shall forthwith appoint an agent, who shall keep an office in the city of New York, Albany or Troy, for the redemption of all circulating notes issued by said corporation, banking asso- ciation, or individual banker, which shall be presented to such agent for payment or redemption. Constructed from section one, chapter 202, Laws of 1840, as amended by section one, chapter 203, Laws of 1851. Their ap- § 87. Such agent shall be appointed in writing, and fnsu^rin-such appointment in writing shall be delivered to the ofSoe. superintendent forthwith, and filed in his office ; and any corporation having banking powers, banking association, etc^'^omit banker or other person may be an agent for the purpose teulent" of redemption ; and if any such corporation, association may ap- point. Qp banker shall omit to appoint such agent forthwith, the superintendent shall appoint such agent for such cor- poration, association or banker, and file such appoint- ment in his office. Constructed from section two, chapter 202, Laws of 1840. List of § 88. The superintendent, immediately after such ap- usifed!' pointment and filing thereof in his office, shall publish during such time as he may deem proper, a list of such State of New York. 49 agents in the State paper, and in at least two daily news- papers in the city of !New York, the expense whereof shall be paid by the corporations, associations and bank- ers above mentioned. Constructed from section three, chapter 202, Laws of 1840. § 89. Every such corporation, banking association or Penaitiea ° ■' r ; o for neglect. individual banker, whose agent shall neglect or refuse to redeem their notes on demand as aforesaid, shall pay to the person making such demand interest upon the notes so demanded, at the rate of twenty per centum per an- num ; and if such redemption and payment of interest is not made at said office within twenty days from the time when first demanded, such corporation, banking associa- tion or individual banker shall be liable to be proceeded against by the superintendent of the banking department in the same manner and with the like effect as though insolvent ; and such corporation, banking association or individual banker shall not thereafter issue or put in cir- culation any of their bills or notes ; and the superintend- ent shall, in that case, proceed in the same manner as is directed in section ninety-two of this act. Constructed from section five, chapter 202, Laws of 1840. § 90. It shall be the duty of every such corporation, Eedemp- banking association and individual banker out of the one-quar? ter of one cities of New York, Albany, Brooklyn and Troy, to re- gfjg"^"^^ deem and pay on demand all circulating notes issued by such corporation, banking association or individual banker presented for redemption or payment at the office of their said agent, in the city of New York, Albany or Troy, at a rate of discount not exceeding one-quarter of one per centum. Constructed from section four, chapter 202, Laws of 1840, as amended bj section two, chapter 203, Laws of 1851. 7 50 Banking Laws of the Demand 8 91. Whenever an action shall be brought against an and pro- " o o no^n-pay- incorporated bank, banking association or individual ment. banker for the recovery of the amount due on any cir- culating note or notes, registered in the superintendent's office, the payment of which shall have been demanded at the banking-house or usual, place of business of the defendant, if it shall appear on the trial, or otherwise, to the court in which such suit is brought, that at the time such demand of payment was made, the defendant offered in payment the circulating note or notes issued by any bank, association or banker, other than the defendant, which were at the time at par, in the city of New York, Albany or Troy, or a draft or drafts on any bank, asso- ciation or banker in the city of New York, Albany or Troy, or either of the same, for the amount of the circu- lating note or notes so presented, with an affidavit if required, that such draft or drafts is or are available to their fuU amount, to insure the immediate payment thereof on presentation, or in case any action shall be commenced upon such note or notes before the expira- tion of fifteen days from the time of the first demand thereof, as above mentioned; and provided such bank, association or individual banker shall be ready and pre- pared to redeem such note or notes in the lawful money of the United States, at the counter or ordinary place of business of such bank, association or banker, at the expi- ration of said fifteen days from the time of the first demand thereof, with interest, then in either case the plaintiff in such action shall not recover any costs, fees or disbiarsements whatever, against the defendant, and shall be entitled to recover no more than six per centum interest, in lieu of all damages for the non-payment of State of Xew York. 51 the said circulating note or notes ; but no interest shall be recovered upon such note or notes in any action, unless the plaintiff or holder thereof shall have again presented the same for payment, at the banking-house of* ordinary place of business of such defendant, on or after the fif- teenth day after such first demand, and before the twen- tieth day, and the defendant shall have neglected and refused to pay the same with interest to that time, as aforesaid. And if such bank, association or banker, at the time of the first presentation of said circulating note or notes, shall have offered to pay current bank notes or drafts, or both, or either, in the manner above provided, and shall, at the time of the second presentation, pay or tender the amount of such note or notes thus demanded, in the lawful money of the United States, at their bank- ing-house or ordinary place of business, then such bank, association or banker shall not be deemed to have sus- pended or refused specie payment, within the meaning of any statutes authorizing proceedings for the dissolu- tion of the charter of such bank, or authorizing proceed- ings to restrain or enjoin the ordinary business of such bank, association or banker, nor shall such bank, associa- tion or banker, in such case, be liable to any other or greater damages for the non-payment of such circulating note or notes than as above provided, any provision in the charter of any bank, or any other statute to the con- trary notwithstanding. Constructed from section three, chapter 203, Laws of 1851, changed to conform to chapter 667, Laws of 1880, by substituting six for seven per cent interest. § 92. In case the maker or makers of any such cireu- when ana how notes lating note or notes, countersigned and registered as may be * So in original. 52 Bajjking Laws of the aforesaid, shall at any time hereafter, on lawful demand during the usual hours of business, between the hours of ten and three o'clock, at the place where such note or notes is or are payable, fail or refuse to redeem such note or notes in the lawful money of the United States, the holder of such note or notes making such demand may cause the same to be protested, in one package, for non-payment, by a notary public, under his seal of oflBce, in the usual manner, unless the president, cashier or teller of such bank shall offer to waive demand and notice of the protest ; and shall, in pursuance of such offer, make, sign and deliver to the party making such demand, an admission, in writing, stating the time of the demand, the amount demanded, and the facts of the non-payment thereof, and the superintendent, on receiving and filing in his office such admission or protest, together with Notice and such note or notes, shall forthwith give notice in writing proceed- Idss, if to the maker or makers of such note or notes, to pay notes not ' ^ J Sfteen the same ; and if he or they shall omit to do so for days. fifteen days after such notice, the superintendent shall immediately thereupon (unless he shall be satisfied that there is a good and legal defense against the payment of such note or notes) give notice in the State paper, that all the circulating notes issued by such person or association will be redeemed out of the trust funds in his hands for that purpose, and the superintendent shall be required to apply the said trust funds belong- ing to the maker or makers of such notes, to the pay- ment pro rata of all the circulating notes put in cir- culation by the maker or makers of such dishonored notes, pursuant to the provisions of this act, and adopb such measures for the payment of such notes as will, State of New Yoek. 53 in his opinion, most effectually prevent loss to the holders thereof. Constructed from section four, chapter 260, Laws of 1838, and section one, chapter 46, Laws of 1841, as amended by section four, chapter 203, Laws of 1851. § 93. In case such person or association of persons shall vfhen " r 1 securities fail or refuse to pay such bills or notes on demand in the '° ^ ^°''^" manner specified in the last preceding section, the super- intendent, after the ten days' notice therein mentioned, may proceed to sell, at public auction, the public securi- ties so pledged, or any of them, and out of the proceeds of such sale shall pay and cancel the said bills or notes, default in paying which shall have been made as afore- said ; but nothing in this act contained shall be consid" ^bg®'^^ ered as implying any pledge on the part of the State for payment" of Dills. the payment of said bills or notes beyond the proper ap- plication of the securities pledged to the superintendent for their redemption. Constructed from section eleven, chapter 260, Laws of 1838, omitting bonds and mortgages in conformity to chapter 247, Laws of 1879. § 94. Such association or individual banker shall bepamages " for aon- liable to pay the holder of every bill or note put in circu- P^y"*"** lation as money, the payment of which shall have been demanded and refused, at the banking-house or usual place of business of such association or banker, damages for non-payment thereof in lieu of interest at and after the rate of six per centum per annum, from the time of such refusal until payment of such evidence of debt and damages thereon. Constructed from section twenty-nine, chapter 260, Laws of 1838, as amended by section five, chapter 203, Laws of 1851, changing interest clause from seven to six per cent, to conform to chapter 567, Laws of 1880. § 96. Nothing contained in the last preceding three Exoep- sections shall apply to cases where circulating notes regis- "Ig^*'" 54 Banking Laws of the tered in the superintendent's office shall be presented for payment to the agent of anj incorporated bank, banking association, or individual banker appointed according to tlie provisions of this act relating to the redemption of bank notes, nor to any bank, banking association, or in- dividual banker, for whom there shall not be at the time an agent duly appointed as prescribed in the provisions ; nor to banks, associations, or individual bankers, whose place of business is in either of the cities of New York, Albany, Brooklyn or Troy. Constructed from section six, chapter 203, Laws of 1851. ^rotest"^ § 96. All fees for protesting *and circulating notes ow pa . jgg^^g^ Y,j any banking association or individual banker shall be paid by the person procuring the services to be performed, for which such association or banker shall be liable, but no part of the securities deposited by such as- sociation or banker shall be applied to the payment of such fees. Constructed from section ten, chapter 363, Laws of 1340. Agen-tsto | 97. Every association and individual banker who Eynew shall hereafter commence business under the laws of this associa- tions State shall, upon first receivins; any circulating notes before any ' ^ a j s tion"* from the superintendent, appoint an agent for the pur- furnished. . . . pose of redemption, and be subject in all respects to the provisions of this act in relation thereto ; and the superin- tendent is hereby directed not to deliver any circulating notes to such association or banker, until such appoint- ment is made and filed in his office ; and such appoint- ment shall be immediately published by the superin- tendent of the banking department in manner aforesaid. Constructed from section six, chapter 202, Laws of 1840. * So in original. State of New York. 55 § 98. Appointments of agents for the purpose of re- meat'niay demption may be revoked and new appointments ofvoked. agents may be made from time to time, by deKvering siicli revocation and appointment to the superintendent, who shall cause the same to be published as aforesaid. Constructed from section seven, chapter 202, Laws of 1840. § 99. It shall be lawful for any number of incorporated ^f ^aSj'*' banks, banking associations and private bankers, by agree- ajfpoint a common ment, to associate together for raising a joint fund to be ^sent. placed in the hands of their common agent, for the redemption of their circulating notes in the city of New York or Albany, and also the circulating notes of other incorporated banks, banking associations and individual bankers, in such manner and under such regiilations as may be agreed upon, and to employ such agents and clerks as they may deem necessary to carry on the busi- ness of such common agency ; but nothing in this section contained shall authorize the redemption or purchase by such agency of any circulating notes at a discount of more than one-half of one per centum, nor to relieve or discharge such incorporated bank, banking association or individual banker, from any duty or liability i-equired or imposed by this act. Constructed from section eight, chapter 202, Laws of 1840. § 100. Nothing in this act contained shall be so con- ^^J^^^'^g, stnied as to authorize any incorporated bank, banking from pur- chasing association or individual banker to purchase, buy in, or gxcept'as^^ take up, directly or indirectly, their circulating notes at provided. an amount less than what purports to be due thereon at any other place, or in any other manner than is directed in and by this act. Constructed from section nine, chapter 202, Laws of 1840. 56 Banking Laws of the StfJn § 101- It shall be the duty of the siiperinteudent to ofinaoi- make a final distribution of the funds in his hands vent banks. arising from the sale of securities deposited with him by associations or individual bankers, under the act to authorize the business of banking, or under this act, who have failed or who may hereafter fail to redeem their circulating notes, which distribution shall be made in the manner herein prescribed. At the expiration of six years after the first sale made by the superintendent, of the securities of any such insolvent banking association or individiial banker, the superintendent shall issue a final notice to the holders of the circulating notes issued by such banking association, or individual banker, requir- ing the presentation of such notes within six months after the date of said notice, and any of such circulating notes which shall not be presented within the time thus specified shall cease to be a charge or claim upon the funds of said banking association or individual banker Final remaining in the hands of the superintendent. Any of such circulating notes which shall be presented within the period above limited shall be received and paid by the superintendent at the same rate which shall have been paid on like notes previously pre- sented, and if all the notes of any banking association or individual banker so presented shall have been re- deemed at their par value, he shall pay to said associ- ation or banker the residue of the fund remaining in his hands belonging thereto. But in case said notes shall not have been redeemed at par, then the holder shall be entitled to a certificate showing the balance, if any, due thereon. Constructed from section one, chapter 881, Laws of 1850. State of New Yokk. 57 § 102. At the expiration of the notice of six months, fl^^^^^ required to be given by the preceding section the super- trlbuted intendent shall ascertain the amount of the residixe of the ^ certifi- cate fund remaining in his hands belonging to the creditors i'°''^«''»- of such insolvent association or banker, and after deduct- ing therefrom all expenses justly chargeable thereon, he shall make a j>ro rata distribution of the residue upon the outstanding certificates given for the balance due to the holders of the circulating- notes of said association or banker, which shall have been redeemed in part, and it shall be the duty of the superintendent to issue a notice to the holders of such certificates, stating the rate or amount payable thereon, and requiring said holders to present the same within six months after the date of said notice. See QOte to succeeding section. 8103. Any of the certificates referred to in the last Uen on "^ •' fund to section which shall not be presented within the time aiter^six specified in said section shall cease to be a charge or claim upon the residuary fund in the hands of the super- intendent. Sections 102 and 103 are constructed from section two, chapter 331, Laws of 1850. § 104. After making the final distribution, directed in unclaimed " => ' fund to be section one hundred and two of this act, if any portion tre'iu^" of said fund shall remain unclaimed, the same shall be deposited in the treasury and applied toward paying the ordinary expenses of the banking department. Constructed from section tliree, chapter 331, Laws of 1850. § 105. The notice required to be given by this act to Notice _ fliorssEiiu the creditors of insolvent banking associations or indi- fjs^laP"''' vidual bankers shall be published at least six weeks in 58 Banking Laws op the one or more newspapers which the superintendent shall deem best calculated to inform such creditors, and the cost of such publication shall be defrayed out of the fund to which said notice shall refer. Constructed from section four, chapter 331, Laws of 1850. Redemp- g 106. It shall be optional with every incorporated by'banifs, bank, banking association or individual banker, doing etc. the business of banking, under any statute of this State, and receiving, on deposit, in the course of its or his busi- ness, or otherwise, the circulating notes issued by any other incorporated bank, banking association or indi- vidual banker, engaged in the business of banking under any such statute, to present such notes for redeniption and payment, in the manner and upon the terms now provided by law, either to the lawful redeeming agents, or at the counters of the incorporated banks, banking associations or individual bankers issuing them ; but every such incorporated bank, banking association and indi- vidual banker shall elect to present, and shall present such notes and all of them it or he may have on hand at the time of such presentation, either to the lawful agents, or at the counters of the banks, banking associations, or individual bankers issuing them, for redemption and pay- ment, in the manner provided by law, as often at least as once in each successive week, when more than the sum of ten thousand dollars are held by said incorporated banks, banking association or individual banker. Constructed from section one, chapter 804, Laws of 1857. Notice of 8 107. If either of such banks, banking associations or election " ' o ^otershaii individual bankers, holding such circulating notes, shall be preaen- , p -i . ted for elect to present the same tor redemption and payment at the counters of the banks, banking associations or bank- State of New York. 59 ers issuing them, it or he shall cause a written or printed notice of such election, attested by the signature of the president or cashier of the bank, banking association or banker, so holding them, under the seal of such bank, banking association or banker, that it or he will there- after seal and present such notes and all of them that it or he shall have on hand at the time of such sealing, at the counter of the bank, banking association or banker issu- ing them, for redemption and payment, as often at least as once in each successive week, when more than the sum of ten thousand dollars are held by said incorporated banks, banking association or individual banker, to be redeemed and paid in the manner required by law ; and when such notice shall have been given, such notes so Notes to ° ' be presen- received by such banks, banking associations and bankers ing, ex™ ceptten aforesaid, giving such notice, shall thereafter be presented ^^^f at such counters, and not elsewhere, for redemption and givea.^ ° payment, unless a further notice of ten days shall be given, in the manner above provided, that such notes will thereafter be presented for redemption and payment to the lawful redeeming agent aforesaid, within the times and upon the terms prescribed by law ; but nothing herein contained shall be so construed as to prohibit banks, banking associations and individual bankers from redeeming, presenting, holding, pledging or exchanging Private each other's circulating notes in the manner, within the hibifed" times, and upon such terms as they may agree upon, or may heretofore have agreed upon, and as shall be con- formable to pre-existing laws. Constructed from seotiou two, chapter 804, Laws of 1857. § 108. Every incorporated bank, banking association Penalty for vioia- and individual banker, who shall knowingly and will- *'<>"■ 60 Banking Laws of the fully neglect or refuse to comply with the provisions of the last two preceding sections shall forfeit and pay the sum of one thousand dollars, to be sued for and recov- ered in the name of the people of the State of New York, in any court having competent jurisdiction. Constructed from section three, chapter 804, Laws of 1857. Notice of § 109- !• Whenever any banking association, individ- closing business, ^al banker, receiver of a bankmg association, assignee or assignees, administrators, executors, personal representa- tives or successors of an individual banker, shall have given notice to the superintendent of their intention to close the business of banking, or the trustees or legal rep- resentatives of any incorporated bank whose charter has expired, or the receiver of any incorporated bank which shall have been declared insolvent, shall have redeemed at least seventy-five per centum of the largest amount of their circulating notes outstanding at any time, as shown by the books of the banking department, they shall be whende- entitled to deposit with the superintendent, and he is be made hereby authorized to receive a deposit of money equal to and other '' _ _ ./ i vrith-"^^ the amount of the outstanding circulation at the time of such deposit, to be placed by him in some bank in the city of Albany, in good credit, upon the receipt of which it shall be lawful for the superintendent to give up all other securities theretofore deposited with him for the redemption of circulating notes issued thereon. Notice to 2. Upon the receipt of such deposit the superintendent months'.'^ shall immediately give notice in the State paper, and at least one newspaper in the county where such bank, banking association or banker shall have been located or doing business, which notice shall be published at least once a week for six months successively, that the State of New Yobk. 61 notes of such bank, banking association oi* banker will be redeemed by him, at the bank where such deposit is Notes not presented made, at par; and that all the outstanding circulating ^ars° *'^ notes of such bank, banking association or banker must be so presented for redemption within six years from the date of such notice, and all notes which shall not be thus presented for redemption and payment within the time specified in such notice, shall cease to be a charge upon the funds in the hands of the superintendent for that purpose. 3. At the expiration of such notice, it shall be lawful Money to '■ be given for the superintendent to surrender, and such bank, pgation of T T . . . 1 , . . notice, banking association, banker, receiver, assignees or trus- tees, or their legal representatives, shall be entitled to receive from him all the money remaining in his hands after such redemption, except so much thereof as may be necessary to pay the reasonable expenses chargeable against the said accounts, including the payment for the publication of the above-mentioned notices. 4. AH circulating notes of such bank, banking associa- Notes not presented tion or banker which shall not have been presented for ''*j?'^^*°''^ payment within the period required by such notice shall, upon the expiration of such period, cease to be a lien or charge upon the property and effects of such bank, bank- ing association or banker, in the hands of such receivers, assignees, trustees or otherwise ; and all liability of such receivers, assignees, trustees, banks, banking associations or bankers, for or on account of any circulating notes which shall not have been presented within the time aforesaid, shall also cease. 5. Said trustees, receiver, assignees, bank, banking e™fm^ay association or banker may, after the full payment of all assets ■' ^ •' ' after full the circulating notes issued by them respectively, which ^P^tes. 62 Bakkikg Laws of the shall have been presented within the time required by such notice, and of all other lawful claims and demands against such bank, banking association or banker, divide the remaining property and effects of said bank, banking association or banker among the stockholders thereof, their or his personal representatives or assigns, according to their respective shares and interest therein. Constructed from section one, chapter 236, Laws of 1859, as amended by chapter 476, Laws of 1865, and chapter 476, Laws of 1867. Notestobe 8 110. In case the bank so designated shall at any time protested '' o j toredelm. ^^^^ '^^ refuse to redeem such notes at par when pre- sented, they shall be protested as required by section ninety-two of this act, and the superintendent shall there- upon, in manner required in said section, provide for the redemption of said notes. Constructed from section three, chapter 191, Laws of 1867. Banking § 111. Ou the return to the superintendent and the- associa- to°reoeWe destruction by him of any of the notes of the banking as- tionate sociatiou or individual banker making a deposit as afore- amount of deposited. ^^^^> the Said banking association or individual banker or their legal representatives shall be entitled to receive from him a proportionate amount of the stock so de- posited ; and at the expiration of six years from the date of the notice required by section one hundred and nine of this act, the said notes shall cease to be a lien upon the stock so deposited, and the same shall be surrendered to the lawful claimant therefor. The existing provisions of law relative to the transfer and exchange of stocks de- posited with the superintendent, except as herein modi- fied, shall apply to the stocks deposited pursuant to the provisions of section one hundred and nine of this act. Constructed from section four, chapter 191, Laws of 1867. State of New York. 63 § 112. Nothing in the banking laws of this State shall circuia- be construed as requiring any banking association or indi- ""J"'™^- vidual banker to issue circulating notes. Constructed from section three, chapter 475, Laws of 1867. § 113. It shall be lawful for the superintendent of the Deposit •^ received banking department to receive a deposit of cash, pursuant notioe"of to the provisions of section one hundred and nine of this to close, act, without the notice of intention to close this business of banking therein required ; but where such notice is not given, the banking association or individual banker mak- ing such deposit shall continue to make such reports and statements, and to publish the same, as are or may be re- quired of the banks of this State by the laws thereof, and be in all respects amenable to the banking laws of this State, as in full operation, as a bank of discount and de- posit, until due notice and evidence of the discontinuance of such business of banking shall be given to the superin- tendent, which discontinuance shall require the concur- rence of the owners of a majority of the shares of stock in such bank ; and this provision shall extend and apply to any bank that has heretofore made such deposit to re- deem its outstanding circulation, without having given notice of intention to close the business of banking ; and any bank having given such notice, and made the deposit of cash or stocks, as required bj* law, may withdraw such Notice may be notice at any time within two years after making such re^i'ed. deposit, and may thereupon resume the business of bank- ing under its corporate name, and subject to the laws of this State in relation to banking ; but such withdrawal shall not aflfect the redemption of its circulating notes previously issued, according to the terms advertised by the superintendent, as required by law, nor shall such 64 Bankikg Laws of the bank be entitled to issue any circulating notes nntil the time for the redemption of its previous issue shall have expired. Constructed from section four, chapter 476, Laws of 1867. Cirouia- § H^^- It shall be unlawful for any incorporated bank- tion of cer- tain for- ina: institution within this State, and for any association eignbank ° i j S?bfte§™' or any individual or individuals authorized to carry on the business of banking under the laws of this State, to receive, pay out, give or ofEer in payment, as money, to circulate or attempt to circulate as money, any bill, note or other evidence of debt, issued or purporting to have been issued by any corporation, association or individual situated or residing without this State, and which bill, note or other evidence of debt shall, upon any part thereof, purport to be payable or redeemable at any j)lace, or by any person, association or corporation within this State. See note to succeeding section. Notes not 8 115. It shall not be lawful for anv incorporated received at » i Eepaid'° banking institution within this State, or any association, or any individual or individuals authorized to carry on the business of banking under the laws of this State, directly or indirectly to lend or pay out for paper dis- counted or purchased by them, any bank-bill, or note or other evidence of debt, which is not received at par by the said banking institution, association or individual, for debts due to the said banking institution, association or individual. Sections 114 and 115 are constructed from sections one and tliree, chapter 855, Laws of 1889. Bills less 8 116. It shall not be lawful for any banking associa- than $1,000 " ./ & madeVay- t^*^" formed under the laws of this State to make any of State of New Yoke. 65 its bills or notes of a denomination less than one thou- able ex- cept at sand dollars, to be piit in cu-culation as money, payable s^iation^" at any other place than at the office where the business of the association is carried on and conducted. CoDstruoted from section thirty-one, chapter 260, Laws of ]888. * § 117. No banking association or individual banker, ^^^1°'^ as such, shall issue or put in circulation any bill or note for putting in circula- of said association or individual banker, unless the same "°° °'' shall be made payable on demand and without interest, except bills of exchange on foreign countries, or places beyond the limits or the juiisdiction of the United States, which bills may be made payable at or within the cus- tomary usance, or at or within ninety days' sight, and except certificates of deposit payable on presentation, Provisions AS to 061"— with or without interest, to bearer, or to the order of a deposf^. "' person named therein, but no such certificate of deposit shall be issued except as representing money actually upon deposit ; and every violation of this section by any officer or member of a banking association, or by any individual banker, shall be deemed and adiudged a mis- Penalty ' •• =^ for viola demeanor, punishable by fine or imprisonment, or both, in the discretion of the court having cognizance thereof. (As amended by chapter 564, Laws of 1886.) Constructed from section four, chapter 363, Laws of 1840, as amended by section one, chapter 251, Laws of 1850. 8 118. It shall not be lawful for any incorporated Foreign " . bank bills banking institution within this State, or any association cirou^ated or any individual or individuals authorized to carry on or bankers In this the business of banking under the laws of this State, or gJeate? ^ any person whatever within this State, directly or indi- count than * This section not applicable to private bankers, see opinion of attorney- general, page 445. 9 viola- tions of act 66 Banking Laws of the there- rectly, on any pretense whatever, to procure or receive, domeitic Or to ofEcr to rcceive, from any corporation, association, person or persons whomsoever, any bank-bill, or note or other evidence of debt in the simihtude of a bank note, issued or purporting to have been issued by any corpora- tion, association or individual situate or residing without this State, at a greater rate of discount than is or shall be at the time fixed by law for the redemption of the bills of the banks of this State at their agencies ; nor shall it be lawful for any banking institution, association, individual or individuals, in the first part of this section mentioned, to issue, utter or circulate as money, or in any way, di- rectly or indirectly, to aid or assist in the issuing, uttering or circulating as money, within this State, of any such bank-bill, note, or other evidence of debt, issued or pur- porting to have been issued by any corporation, associa- tion or individual situate or residing without this State, or to procure or receive in any manner whatever, any such bank-bill, note or evidence of debt, with intent to issue, utter or circulate, or with intent to aid or assist in issu- ing, uttering or circulating the same as money within this State; but nothing in this act contained shall be construed to prohibit any bank or banking institution May pay receiving and pajang out such foreign bank-bills as they out for- bWis cu?-'' ^^^^^ receive at par in the ordinary course of their busi- ■ ness ; and nothing in this section contained shall pro- hibit the said banking institutions, associations or in- dividual bankers, or any person whatever in the first part of this section mentioned, nor shall they be pro- hibited from receiving foreign notes from their dealers and customers in the regular and usual course of their business, at a rate of discount not exceeding that which State of New York. 67 is or shall be at the tmie tixed by law for the redemption Mayre- ■ '■ ceivefor- of the bills of the banks of this State at their agencies, from'JIul. or from obtaininsr from the coniorations, associations or ordinary course of individuals, by which or by whom such foreign notes '•"^'"^^s. were made, the payment or redemption thereof. See note to sucoeediug section. § 119. Every corporation and every association and in- penalty. dividual authorized to carry on the business of banking, who shall offend against any of the provisions of sections one hundred and fourteen, one hundred and fifteen and one hundred and eighteen of this act, shall forfeit, for each and every offense, the sum of one thousand dollars, to be recovered with costs of suit, in the name and for the use of any person who shall sue for the same and prosecute such suit to judgment in any court having cognizance thereof ; and every officer and clerk of such corporations and associations, and every such individual banker and his clerks and servants, who shall knowingly act or assist in any violation of any of said provisions of this act, shall, upon conviction, be deemed guilty of a misdemeanor, and shall be punished by fine or imprison- Misde- ' " i- meaaor ment, or both, in the discretion of the court before which such conviction shall be had ; but such fine shall not ex- ceed five hundred dollars, and such imprisonment shall not exceed six months. Sections 118 and 119 are constructed from sections two and four, chapter 355, Laws of 1839, as amended by chapter 223, Laws of 1853, except that sec- tion two is altered to conform to and include section two, chapter 223, Laws of 1853, relating to private persons. § 120. All checks, bills of exchange or drafts, appear- Bills of ex- ing on their face to have been drawn upon any bank or specia'ed"" ,. .. . T . T I , , day to be upon any banking association, or individual banker, carry- without ing on banking business under the laws of this State 68 Banking Laws of the which are on their face payable on any specified day or in any number of days after the date or sight thereof, shall be deemed due and payable on the day mentioned for the payment of the same, without any days of grace being allowed, and it shall not be necessary to protest the same for non-acceptance. Constructed from section two, chapter 416, Laws of 1857. Transfers § 121. No transfer of securities now held or hereafter bysuper- received by the superintendent of the banking depart- counter- ment, as security for circulating notes issued for the treasurer, same by him, shall be deemed valid or of binding force or effect, unless the same be countersigned by the treas- urer of the State, or in his absence from his office or ina- bility to perform the duties of his oiBce, by his deputy. Treasurer 1* ^^^^1 ^^ *^® ^"''7 o^ *^® treasurer aforesaid to keep in record^of his office, or in , the office of the superintendent of the same and bank^ banking department, a book in which shall be entered the name of every bank, banking association or individ- ual banker, from whose account such transfer of securi- ties is made by the siiperintendent, and the name of the party to whom such transfer is made, unless such transfer shall be made in blank, in which ease the fact shall be stated in said book, and the par value of any stock so transferred shall be entered therein ; and it shall be the duty of the treasurer, immediately upon countersigning and entering the same, to advise by mail the bank, bank- ing association or individual banker, from whose account such transfer is made, of the kind of security and amount of the same thus transferred. Constructed from section two, chapter 103, Laws of 1857. Treasurer § 132. The treasurer shall present, in his annual report to report State of New York. 69 to the legislature, the total amount of such transfers or transfers to I6gl8l&— assignments countersigned by him. *"''®" Constructed from section three, chapter 103, Laws of 1857. § 123. It shall be the duty of the treasurer, or in his Treasurer or deputy absence from his office, or in case of his inability to per- Jgrgj^n"" form the duties of his office, of his deputy, to counter- and record ' r ./' the same. sign and enter upon the book in the manner aforesaid every transfer or assignment of any securities held by the said superintendent, presented for his signature. Constructed from section four, chapter 103, Laws of 1857. § 124. The treasurer shall have, at all times during Treasurer " ° and super- office hours, access to the books of the superintendent of io'havl"' access the banking department, for the purpose of ascertaining to books, the correctness of the transfer or assignment presented to him to countersign ; and the superintendent shall have access to the book above mentioned, kept by the treas- urer, during office hours, to ascertain the correctness of the entries upon the same. Constructed from section four, chapter lOS, Laws of 1857. CHAPTEE VI. Pkovisions to Enforce the Responsibility of Stock- holders. Section 125. Liability of stockholders. 126. The term "stockholder," to whom applied. 127. Exonerated as to stock transferred before default. 128. Names and residences of stockholders entered in book. 129. Judgments on demands against bank. 130. On execution unsatisHed, corporation declared insolvent. 131. Declaration of insolvency and injunction. 132. Hearing of parties, examination, injunction continued. 133. Restraining order — reoeirer. 134. Declaration of insolrenoy on application of stockholder. 70 Banking Laws op the Section 135. Powers and duties of receivers. 136. Conversion of securities — dividends. 137. Expenses of proceedings. 13S. Report on unsatisfied liabilities. 139. I;ist of stockholders to be reported. 140. Reference thereupon to apportion debts. 141. Hearing before referee. 142. Six weeks after appointment referee to report. 143. Farther reference may be ordered. 144. Report on confirmation to be filed. 145. Distribution to creditors. 146. Allowance of expenses to referee and receiver. 147. Delay of distribution not to exceed one year. 148. After debts paid residue to stockholders. 149. Appeal not to stay execution unless ordered. 150. No stay on appeal without security. 151. Order of reference not appealable. 152. Receiver or stockholder may appeal. 153. Appellate court may order new apportionment. 154. Securities to be filed with clerk of court. 155. How same may be enforced. 156. Creditor neglecting to present demand. 157. Actions against non-resident stockholders. 158. Order to be presumptive evidence. 159. Compromise with stockholders by receiver. 160. Stockholder and creditors may oppose order. 161. Proceeding supplementary to execution. 162. Action against non-resident stockholder on execution unsatis- fied. 163. When receiver may sue predecessor. 164. Receiver may sell judgment. 165. Docket and lien of judgment. Liability *§ 126. Whenever default shall be made in the pay- of stock- holders ment of any debt or liability contracted by any corporation by'bank?*^ or joint-stock association, for banking purposes, issuing bank notes or any kind of paper credits to circulate as money, the stockholders of such corporation or association shall be individually responsible, equally and ratably, such responsibility to be enforced as hereinafter provided and in no other manner, for the amount of such debt or liability, with interest, to the extent of their respective * Liability of shareholders of State banks, see opinion of attorney-general, page 438. State of New Yokk. 71 shares of stock in any such corporation oi- association, as hereinafter provided. Constructed from section one, chapter 226, Laws of 1849. §126. The term, "stockholder," as used in the pro- The term visions of this chapter, shall apply, not only to suchto'^bom to apply. persons as appear by the books of the corporation or association to be such, but also to every equitable owner of stock, although the same may appear on such books in the name of another person ; and also to eveVy person who shall have advanced the installments or purchase- money of any stock in the name of any person under twenty-one years of age, and while such person remains a minor, to the extent of such advance ; and also to every guardian or other trustee who shall voluntarily invest any trust funds in such stock ; and no trust funds in the Trustee, ■^ ^ and not hands of such gTiardian or trustee shall be in any way nabfe."'*'^^ liable under the provisions of this chapter by reason of any such investment, nor shall the person for whose benefit any such investment may be made, be responsible in respect to such stock, until thirty days after the time when such persons, respectively, become competent and able to control and dispose of the same ; but the guardian or other trustee making such investment as aforesaid, shall continue responsible as a stockholder until such responsibility devolves upon the person beneficially inter- ested therein; and in respect to stock held by a guardian or other trustee, under a transfer of the same b^' a third person, or under positive directions by a third person for such investment, the person making such transfer or giv- ing such dii'ections, and his executors and administrators, shall, for the purpose of this chapter, be deemed a stock- holder, and the estate of such person, if he be deceased. 73 BANKiifG Laws of the shall be responeible for the debts and liabilities charge- able on such stock, according to the provisions of this chapter. Constructed from section two, chapter 226, Laws of 1849. Liability § 127. The persons who shall be stockholders of any of stock- desoSd corporation or association described in section one hun- 135. dred and twenty-five of this act, at the time of contract- ing any debt or liability by such corporation or association, shall be responsible therefor, as declared in the said section, but shall be exonerated from such responsibility in respect to any stock which shall have been transferred, previous to any default in the payment of such debt or liability, on the books of such corporation or association, to any resident of this State, of full age, in good faith and with- out any intent to evade such responsibility ; and every assignee of any stock so transferred previous to such de- fault shall be responsible for debts and liabilities to the extent of such stock, in the same manner as if he had been the owner at the time of contracting such debt or liability, with the same exception in his favor, in respect to any stock transferred to him, as herein provided ; and the same rule of responsibility shall apply to each sub- sequent assignee. Constructed from section three, chapter 226, Laws of 1849. Names of § 128. A book shall be provided and kept by every andre"i- Corporation and association described in section one hun- be entered dred and twentv-five of this act, in which shall be entered in a book. " ' the names and residences of the stockholders of such cor- poration or association, and the names and residences of the original stockholders of every corporation or associa- tion aforesaid, so far as the same are known to the officers of the bank, the number of shares held by each stock- State op New York. 73 holder, every registered transfer of stock upon the books of the bank, the names of the assignor and assignee, with their residence and the number of shares transferred. The said book shall be at all times, during the usual hours of transacting business, open to public inspection. And a refusal by any officer of such corporation or asso- Penalty elation to exhibit such book to any person demanding the book, inspection thereof, as herein provided, shall subject said corporation or association to a penalty of fifty dollars for every such refusal. And every refusal by any such officer having once refused to exhibit such books as aforesaid is hereby declared to be a misdemeanor, and the officer so offending, upon the conviction thereof, shall be adjudged guilty of misdemeanor, and be punished by a fine not exceeding one hundred dollars for every such subsequent refusal, or by imprisonment for a term not exceeding six months, or by both such fine and imprisonment. The said penalty may be sued for and recovered with costs, by any person who will prosecute for the same ; the one moiety thereof to be paid to such person, and the other moiety to be paid into the treasury of the State. In all proceedings under the provisions of this chapter, the said book shall be presumptive evidence of the truth of the contents thereof ; but such presumption may be repelled by evidence, by any party or person interested in repel- ling the same. Constructed from section four, chapter 226, Laws of 1849, as amended by Chap. 365, Laws of 1859. S 129. After the expiration of twenty days from the Piaintia * . may enter service of any summons and complaint for the recovery °„d|m'ent of any demand against any corporation or association de-aayaa^ter service of scribed in section one hundred and twenty-five of this ^"™"'°"^- act, upon any debt or liability exceeding one hundred 74 Banking Laws of the dollars, in which the precise sum demanded shall be stated, the plaintiff shall be entitled to enter an order for judgment upon the filing such summons and complaint, with due proof of personal service thereof, upon any officer of such corporation or association, and judgment shall be rendered thereon for such demand with interest and costs, whether an answer to such complaint has been served or not, unless an order shall have been filed in the oifice of the clerk where such judgment might be en- tered, granted by a justice of the supreme court or county judge, that the entry of such judgment be stayed until the issue joined or to be joined by the parties be dis- posed of. But no such order shall be granted without proof by affidavit to the satisfaction of such judge that the defendant in such suit has a good defense on the merits to such demand, or some part thereof, arising upon the facts set forth in such affidavits. Constructed from section five, chapter 226, Laws of 1849. Corpora- § 130. Upon the return of an execution against the tion to be fnsofvent Property of any such corporation or association, unsatis- return of fied in whole or in part, or upon proof satisfactory to any execution fl?d*"^" justice of the supreme court that any such execution, although not returned, cannot be satisfied out of any property of the defendant, he shall at once make an order declaring the insolvency of such corporation or association. Constructed from section six. chapter 226, Laws of 1849. Ten days § 131. Any Creditor of any such corporation or associa- pay^blnk, tiou, having a demand exceeding one hundred dollars, be d'e- arising upon any debt or liability, the payment of which andin- shall have been refused by such corporation or associa- junotlon . . may issue, tion, may, at any time after ten days from the time of State of New York. 75 such refusal, apply to a justice of the supreme court for an order declaring such corporation or association insol- vent, and for an injunction as hereinafter provided. If, in the opinion of such judge, upon the facts presented, it be expedient in order to prevent fraud or injustice, he may grant an order for a temporary injunction, restrain- ing such corporation or association, and its offacers, from paying out, or in any way transferring or delivering to any person any money or assets of such corporation or association, or incurring any debt or obligation, until such order be vacated or modified. Constructed from section seven, chapter 226, Laws of 1849. § 132. Upon a hearing of the parties on such short judge on hearing notice as the judge shall appoint, he shall determine Slf ermine whether such corporation or association be clearly insol- may^cause examiua- vent or otherwise, and may require the officers thereof to '''°°- exhibit any and all of its books, papers, accounts, assets and effects, and to be examined on oath touching the same before him, or a referee appointed by him. If he determine that such corporation or association is clearly solvent, he shall, notwithstanding, continue the order for a temporary injunction, if one has been granted, until injunction the demand of the applicant be fully paid, with his costs ^''®°" on such application ; unless it shall have appeared by affi- davit, or otherwise, that such corporation or association have a good defense on the merits of such demand. Constructed from section eight, chapter 226, Laws of 1849. S 133. If the judge determine that such corporation or n not clearly sol- association is not clearly solvent, he shall make an order J^°gi4"n declaring the same insolvent; and shall also, by order, ceiver'to " follow. restrain such corporation or association and its officers, from exercising any of its corporate rights or any rights Ye Banking Laws of the or privileges graated to it by law, and from collecting or receiving any debts or demands, and from paying out in any way, transferring or delivering to any person any of its property, money or effects, until such order be var cated ; and he shall immediately appoint a receiver of the property of such corporation or association. Constructed from section nine, chapter 226, Laws of 1849. One or g i34_ ^^y qj^q qj- more stockholders of any such cor- ersmay " poration or association, owning stock to the amount of apply for to declare One-tenth part of the capital thereof paid in, may at any tionm- time, in hke manner apply to any justice of the supreme court for an order declaring such corporation or associa- tion insolvent, or in imminent danger of insolvency. And if, on the facts verified by affidavit presented, such justice shall deem it necessary or expedient in order to prevent fraud, undue preference or injustice to creditors, he may grant an order in the nature of a temporary Tempor- injunction, as specified in section one hundred and thirty- ary Injunc- tion and one of this act ; upon a hearing of the parties, as soon as may be practicable, he m^y require the exhibition to him, or to a referee to be appointed by him, of all the books, papers, accounts, assets and effects of such corpo- ration or association, and an examination of the officers, servants and agents thereof under oath ; and if he deter- mine that such corporation or association is not clearly to'be de^ Solvent, or that it is in imminent danger of insolvency, he shall make an order declaring such determination, and shall by order restrain the said corporation or asso- ciation and its officers, in the same manner as provided in the last preceding section of this act, and shall also appoint a receiver of the property of such corporation or association. Constructed from section ten, chapter 226, Laws of 1849. State of New York. 7'? § 135. Every receiver, appointed according to the pro- Powerand visions of this chapter, shall, after giving security, take ™°®'™''^' into his possession all the property, effects, books, papers, accounts and demands of such corporation or association, including the securities, if any, which may have been deposited with the superintendent belonging to such cor- poration or association, excepting therefrom so much of the same as may be necessary to enable the superintend- ent of the banking department to pay and redeem the outstanding circulation of such corporation or association. He shall immediately give notice, by publication in such newspapers as the superintendent or any justice of the supreme court shall direct, requiring the creditors of such corporation or association to exhibit and establish their demands before him within thirty days from the time of his appointment. Such receiver shall possess all the powers of receivers of corporations under the third article of title four of chapter eight, and part third of the Revised Statutes in respect to the settlement of all demands exhibited to them, and in all other respects except as herein otherwise provided ; and all such pow- ers now conferred by law on trustees of insolvent debtors as may be applicable, and shall be subject to all the duties and obligations by law imposed on receivers of corporations except as herein modified. Constructed from section eleven, chapter 226, Laws of 1849. § 136. Under the direction of the superintendent, all securities securities deposited with him belonging to such corpora- converted tion or association shall be converted into cash, with the least possible delay, and the receiver shall also convert into cash the effects and demands of such corporation or association, and for that purpose may sell at auction any 78 Banking Laws of the of the said demands which any justice of the supreme court shall authorize to be sold ; and within ninety days from the time of his appointment, unless such time be enlarged by a justice of the supreme court, which may be done for a period not exceeding ninety days, such Dividends receiver shall declare a dividend of the cash in his hands to i>e made ii^ninety among the creditors of such corporation or association. Constructed from sectiou twelre, chapter 226, Laws of 1849. Expenses 8 137. Before making such dividend, the receiver to be de- "^ ° ' fore'raat" shall deduct and retain the sums necessary to defray the ing divi- dend, expenses of the proceedings, and all sums which he may have paid in order to exonerate any property of such cor- poration or association from any pledge or specific lien Assets, or levy under execution or attachment. He shall then how dis- tributed, divide and pay the money in his hands to and among all creditors of the said corporation or association, other than as holders of circulating notes, whose demands shall have been ascertained, in proportion to their demands respectively. Such payments to creditors shall be made in the order prescribed by law in respect to the duties of receivers of corporations. Constructed from section thirteen, chapter 226, Laws of 1849. Report to § ^^^- ^^ there shall remain unsatisfied any debts or be made in , .,. . « relation to liabilities of such corporation or association, the receiver unsatisned *■ ' debts. ^\-^^\^ within thirty days after the declaration of the first dividend, and without waiting for the actual payment of the sums divided, render to a justice of the supreme court residing in the district where the business of such corporation or association was conducted, a particular account of the said debts and liabilities so remaining un- satisfied, and a preliminary account of all his proceedings, under oath, in which shall be set forth the amount of State of New York. 79 cash realized by him, the expenses and allowances claimed by him, all payments that he may have made, the amount on hand to be divided, and the dividends declared by him. Constructed from section fourteen, chapter 226, Laws of 1849. § 139. The said receiver shall at the same time report Uat of " _ _ ^ stockhold- and submit to such justice a true and accurate list and reported, statement of the persons who are stockholders of such corporation or association, the nominal amount of stock held by each and the residence of each stockholder, so far as the same can be ascertained. The said list and statement shall be made up from the stock books, ledger and list of stockholders kept by such corporation or asso- ciation, and shall show when each stockholder acquired and transferred the stock standing in his name. Constructed from section fifteen, chapter 226, Laws of 1849. § 140. The said iustice shall thereupon refer the said Report '' ■* ^ and list to report and list of stockholders to a referee, to be ap- ^l/to^ref- pointed by him, with directions, after giving notice to all persons concerned, to apportion the debts and liabilities of such corporation or association remaining unsatisfied among the said stockholders ratably in proportion to their stock, according to the principles in this act de- clared, and to report his proceedings to such justice, or some other justice of the supreme court in the same district. Constructed from section sixteen, chapter 226, Laws of 1849. § 141. The said referee shall cause notice of his ap- Hearing " ^ before pointnient, and the time and place of hearing on the"^*™®' matters so referred to him, to be given to each stock- holder whose name appears on the said list at least ten 80 Banking Laws op the days before such time, whicli notice shall be served on sucb of the said stockholders as may then reside in the county where the principal office or place for conducting the business of such corporation or association was situ- ated, either personally or by leaving a copy thereof at the residence of such stockholder, with some person of Notice to suitable age, and such notice may be served upon all be given '^ ' •' '^ ers'and'''*" Other stockholders, by publishing the same in one adver- service of . . same. tisement, contammg the names of all such last-mentioned stockholders, for at least three weeks, in such newspapers as any justice of the supreme court may direct, and the same shall always be published in the paper designated by law for the publication of legal notices, and in a paper if there be one printed in the county where the chief office for conducting the business of such corporation or association was located. Constructed from section seventeen, chapter 226, Laws of 1849. AUega- § 142. On such hearing the said referee shall hear the tions and proofs to allegations and proofs of all parties and persons inter- ested in the matter referred, and particularly shall ascer- tain the persons who are chargeable as stockholders for the debts and liabilities aforesaid, and the amount charge- able to each according to the rules and principles declared in the provisions of this act relating to insolvency. At the first special term of the supreme court held in the county in which such receiver resides, or in an ad- To report joining county, after the expiration of six weeks from in six weeks. the time of his appointment, such referee shall report to the justice holding such term, the apportionment of the |3ebts and liabilities among the stockholders made by him in detail, with the proofs taken by him on such hearing. If, in the opinion of such justice, further time is requisite State of New York. 81 to enable the said referee to complete the apportionment directed, or to take further proof in reference to the same, he may grant such further time, not exceeding ninety days. Constructed from section eighteen, chapter 226, Laws of 1849. § 143. On the final completion of such apportionment, Apportion- the same shall be reported at a special term of the su- supreme* court. preme court, as hereinbefore directed, and on the coming in of any such report, the justice holding such term shall proceed to examine the same, and hear the allegations of the parties and persons interested, and may modify or amend the same, or may refer the same back to the same or another referee for further proof or examination, or may confirm the same. Tf there be a further reference, j-urjher notice of hearing thereon may be given by a general may^be ordered. notice published in the same newspapers in which the first notice appeared for two weeks, and a report shall be made thereon within the time to be specified in the order of reference. Constructed from section nineteen, chapier 226, Laws of 1849. § 14:4:. When the report of a referee, made according Report to the last, two preceding sections of this act, shall have cfeS^s^ '" ,. 1 , . . - , office. been confirmed by a justice of the supreme court at any special term thereof, after being modified or amended by him, the same, together with the order of confirmation, shall be filed in the oflice of the clerk of such county as shall be directed by such justice ; and unless an appeal be allowed and entered therefrom as hereinafter pro- vided, the said order of confirmation shall be final as a iudgment against each stockholder for the amount found if con- , , . firmed, to chargeable against him; and one or more executions ^1^®/^"® thereupon may be issued against any one or more of the judgment 11 83 Banking Laws of the against stockholders named in such report or order, for the sum stock- ^ ' holders, ^j. g^^jg chargeable against him or them, in the same manner and with the like effect as upon a judgment in the supreme court, at the instance of the receiver of such corporation or association, and the money collected on such executions shall be paid, to and received by such re- ceiver. Constracted from section twenty, chapter 226, Laws of 1849. Mone^y|o g 14.5. The money so collected, after deducting all ex- dwided. penses of proceedings, shall be without delay divided, distributed and paid over to the creditors of such corpo- ration or association, in the same manner as hereinbefore provided, in relation to the first dividend, by the said re- ceiver. Constructed from section twenty-one, chapter 226, Laws of 1849. Nocessar? § 146. The justice to whom any report by a receiver, expenses a?iowed. ^^ ^J * referee, shall be made as herein provided shall ascertain and allow the necessary expenses attending the execution of their duties, including the hire of such and so many clerks and such professional assistance as may appear to have been useful to expedite the business com- mitted to them, and shall allow to them such reasonable compensation for their services, not exceeding the rate of Eeceivers five dollars for each day actually employed, as he shall eree's fees, (jgem proper, which allowances and expenses shall be de- ducted and defrayed out of the cash in the hands of the receiver before making dividends thereof. Constructed from section twenty-two, chapter 226, Laws of 1849. Dividends § 147. Neither the dividends herein directed to be and appor- not'to^be* made, nor the apportionment of the debts of such cor- beyond poration or association among the stockholders thereof, one year. ^ shall be delayed or suspended by reason of the pendency State of New York. 83 of any litigation or controversy, for the recovery of any demand by or against such corporation or association, unless the same shall be expressly directed by a justice of the supreme court, residing in the district where the busi- ness of such corporation or association was conducted ; and such delay shall in no case exceed one year ; and if, at the time of declaring any dividend, there shall be any prosecution pending in which any demand against such corporation or association may be established, the receiver may retain in his hands the proportion which would belong to such demand, and the necessary costs and ex- penses of the suit or proceeding, to be applied according to the event of such prosecution, or to be distributed in some future dividend, to creditors or among the stock- holders. Constructed from section twenty-three, chapter 226, Laws of 1849. § 148. If, after paying and discharging the debts and f^^^^^^J' liabilities of such corporation or association as herein pro- be distrib- uted vided, and defraying all the expenses of the proceedings, ttSckfoid- there shall remain or come to the hands of the receiver any other assets or effects of such corporation or associa- tion, the same shall be converted into cash as hereinbe- fore directed, and shall be paid to the stockholders upon whom any such debts or liabilities were apportioned in just and equal proportion to the sums contributed and paid by them. Constructed from section twenty-four, chapter 226, Laws of 1849. § 149. No appeal from any determination or order of Appeal a justice of the supreme court, made pursuant to sections "ot^o ; Stay exe- one hundred and twenty-nine, one hundred and thirty, cution ■' ' ■' unless on one hundred and thirty-one, one hundred and thirty-two °''^®'"- and one hundred and thirty-three of this act shall sus- 84 Banking Laws of the pend or delay the execution of such order or the effect of such determination, unless shall be filed, with the notice of the appeal to the clerk of the court, a certifi- cate of a justice of the supreme court, to the effect that there is probable error in such order or determination, nor unless security be given satisfactory to such justice for the payment of the demand upon which the proceed- ings in those sections may be founded, whenever judg- ment shall be rendered therefor, with interest at the rate of ten per centum and costs. Constructed from section twenty-five, chapter 226, Laws of 1849. No appeal 8 150. No appeal from any order or determination from order " ' ^ •' tion^ialfto made pursuant to section one hundred and thirty -four of Btay exe- cution this act shall suspend or delay the execution of such unless ^ -^ given!''^ ^ order or the effect of such determination, unless there be filed, together with the notice of appeal to the clerk of the court, a certificate in all respects corresponding with that required in the last preceding section, nor unless security be given satisfactory to the justice grant- ing such certificate to indemnify the stockholders upon whose apphcation such order or determination was made, against all damages, costs, expenses and losses, by reason of any debt or liability of such corporation or association. Constructed from section twenty-six, chapter 226, Laws of 1849. No appeal § 151- No appeal can be made from any order of any from . . - 1 order of lustice 01 the Supreme court under the provisions of this reference. J -^ r chapter, referring any matter to a referee. Constructed from section twenty-seven, chapter 226, Laws of 1849. Appeal § 152. An appeal from the determination of a justice recli^ver^ of the Supreme court confirming the apportionment of the debts and liabilities of a corporation or association among the stockholders thereof, as provided by this act, State of New York. 85 may be taken by tlie receiver of sucli corporation or association, or by any one or more of the stockholderB affected by such, apportionment, in the same manner and with the like security as provided by law in the case of appeals from a special term of the supreme court to a general term, or from the judgment of such general term to the court of appeals, in the same manner and with the like security and effect as appeals to the same court from any other like judgment, except that it shall not be nec- essary for a receiver so applying to give any security for costs or otherwise. Constructed from section twenty-eight, chapter 226, Laws of 1849. § 153. If any such determination or judgment shall New ^ ^ JO appor- be reversed or modified so that a new apportionment of toSemade when first such debts and liabilities shall become necessary, the is set aside • •' ' on appeal. court in which such reversal or modification shall be made shall direct a new apportionment, and the matter shall be remitted to the proper justice of the supreme court for that purpose ; and the same proceedings shall be had thereon to complete such new apportionment as herein provided in relation to the original apportionment. Constructed from section twenty -nine, chapter 226, Laws of 1849. § 154. Every security taken under sections one hun- securities where to dred and forty-nine, one hundred and fifty and one hun- be flied. dred and iifty-two of this act shall be filed with such clerk of the supreme court as the justice taking the same shall direct. Constructed from section thirty, chapter 226, Laws of 1849. § 155. The security referred to in the last preceding Securities section may be enforced by suit, in the name and for the by^g'Jffi*^ benefit of any person for whose benefit or indemnity the same was taken. Constructed from section thirty, chapter 226, Laws of 1849. 86 Banking Laws of the Creditor § 156. Any Creditor of any such corporation or asso- appearing a j j r umeto ciation who shall have neglected to present his demand to equally, the receiver before the first or subsequent dividend, and who shall present the same before the second or any other subsequent dividend, shall receive the sum he would have been entitled to on any former dividend, before any distribution be made to other creditors. Constructed from section thirty-one, chapter 226, Laws of 1849. Proceed- § 157. In case any stockholder of any such corporation ula°re8i- or association, against whom judgment has been or shall stock- be recovered pursuant to the provisions of this chapter, shall not be a resident of this State at the time of the confirmation of the referee's report and apportionment provided by section one hundred and forty-four of this act, an action may be commenced in the name of the re- ceiver of such corporation or association, or of the as- signee of such judgment, for the recovery of the amount thereof, with interest. Constructed from section one, chapter 872, Laws of 1863. Order to § ^^^- 1° ^uch action the order of confirmation of such be pre- sumptive report and apportionment shall be presumptive evidence evidence. ^ i j x i of the liability of such stockholder for the amount in and by such report and apportionment found chargeable against him, with the interest thereon. Constructed from section one, chapter 372, Laws of 1863. Power of §159. Such receiver shall have power, under the order comprom- of the Supreme court of the district in which he shall re- ise with ■■ holder. side, to compromise and settle with any stockholder of such corporation or association, the amount of any judg- ment which has been or shall be so recovered against him as such stockholder, upon such terms and conditions as shall be prescribed by such order, and thereupon to dis- State of New York. 87 charge such judgment. No such order shall be granted, except upon ten days' notice of the application therefor to be given to the stockholders and creditors who shall have appeared in the proceeding in which such judgment was recovered, or their attorneys. Constructed from seotioa two, chapter 372, Laws of 1863. § 160. Such stockholders and creditors, or any of them, stock- " ' J ' holder and maj' appear before the court on the making of said mo- may op-^ poae order. tion, and oppose the same. Nor shall such order be granted unless it shall appear that an execution has been dented," * issued against the property of said judgment-debtor to the sheriff of the county where said judgment-debtor re- sides, or has a place of business; or if said judgment- debtor do not reside in the State, or is a foreign corpora- tion, to the sheriff of the county where the said order for the confirmation of the report of said referee has been filed, and that said execution has been returned unsatisfied in whole or in part. Constructed from section three, chapter 872, Laws of 1863. § 161. Judgments against stockholders of any such Prooeed- ° ° ^ •' ings sup- corporation or association, recovered as aforesaid, may^J^"oex- , , . . 1 , ecution. be enforced in the manner prescribed in title twelve, chapter seventeen of the Code of Civil Procedure, relat- ing to proceedings supplementary to execution against property. Constructed from section four, chapter 372, Laws of 1863, with altera- tions conforming it to other sections of the revision and the Code of Civil Procedure. § 162. Such receiver, upon obtaining leave by an order Action on of a justice of the supreme court, after the return of exe- Son-resi- cution unsatisfied upon any judgment recovered pursuant stock- to the foregoing provisions of this chapter, against a 88 Banking Laws of the stockholder being a non-resident of this State, may bring an action in any court having jurisdiction of the person of such non-resident stockholder to enforce his liability as such stockholder, and in case any such non- resident stockholder shall have deceased, such action may be brought against his personal representative. Constructed from section seven, chapter 312, Laws of 1863. When re- 8 163. Whenever the receiver or receivers of any in- ceiver may " cessor****" Solvent corporation or joint-stock association for banking purposes has been removed or shall hereafter be removed, and has neglected, or shall hereafter neglect, for tlie period of sixty days after the appointment of his or their successor or successors, to pay to such successor or suc- cessors the moneys remaining in the hands of the receiver or receivers so removed, or any part thereof, then and in that case such successor or successors may bring and maintain an action in any court of competent jurisdiction, for the moneys neglected to be paid over, or any part thereof, against the receiver or receivers so removed, or his or their surety or sureties on the bond given by such receiver or receivers so removed, for the performance of his or their duties as such receiver. Constructed from section one, chapter 26, Lavrs of 1866. Receiver § 164:. Such receiver shall have power and authority, may sell judgment, under an order of a justice of the supreme court, to sell at public auction any judgment which has been or shall be recovered against such stockholder, after such notice, and upon such terms and conditions as shall be prescribed by such justice. Constructed from section five, chapter 372, Laws of 1863. Doci£,et § 165. The judgments recovered pursuant to the pro- judgment. yigiQQg of this chapter may be docketed in any county State of New Yokk. 89 of this State, upon filing a transcript thereof, and shall thereupon be a lien vipon the real estate and chattels real of the persons against whom the same shall have been recovered, situate in any county in which the same shall have been docketed, in the same manner as a judg- ment recovered in a civil action upon personal service of process, and may be enforced by execution against real and persoual property, in the same manner as such judgment. Constructed from section six, chapter S72, Laws of 1863. CHAPTER VII. Changes from State to National and from National TO State Banks. Section 166. Assent to formation of national banks. 167. National banks deemed State institutions. 168. State bank changed to national deemed to have surrendered its charter. 169. Notice of intention to change. 170. Stockholders may vote by proxy. 171. After change old directors to continue. 172. Reduction or increase of capital. 173. Certificate of change, assets, circulating notes. 174. Plates and dies to be obliterated. 175. New association liable for prior debts. 176. Banks changed before passage of this act. 177. On dissolution of national bank directors may organize as a State bank. 178. Thereupon assets to vest in new bank by operation of law^ Directors to continue. § 166. The assent of the legislature is hereby given to Assent of the organization of associations for carrying on the busi- limlftar ness of banking within this State, pursuant to the provi- banks, sions of the act of congress " To provide a national cur- rency, secured by a pledge of United States stocks, and to provide for the circulation and redemption thereof," 90 Banking Laws op the approved June third, eighteen hundred and sixtj-four, and of title fifty-two of the Revised Statutes of the United States, and the provisions of chapter twenty, title twenty, article three, part first of the Revised Statutes of this State, entitled " Of unauthorized banking," etc., shall not apply to the associations formed under or the notes issued in accordance with the acts of congress aforesaid. Constructed from section one, chapter 97, Laws of 1865. Such § 167. Every bank organized pursuant to the acts of stat™in- congress aforesaid, within this State, and every bank or- stitutions. . t ■, ■ , p ■ ^ ■ ci. ganized under either oi said acts m pursuance oi this act, shall be deemed and held to be a banking institution for all financial transactions of the government of this State, and any and all officers thereof, the same as if organized under and in pursuance of the general banking laws of this State. Constructed from section one, chapter 97, Laws of 1865. State bank § 168. Any bank incorporated or organized by author- deemed'to ^*J ^^ ^^^^ State, which shall become an association for rendered carrying On the business of banking under the laws of itsotiarter. -^ » o the United States, shall be deemed to have surrendered its charter, if it shall have complied with the require- ments of this act relating thereto ; provided that every such bank shall nevertheless be continued a body corpo- rate for the term of three years after the time of such surrender, for the purpose of prosecuting and defending suits by and against it, and of enabling it to close its con- cerns, and to dispose of and convey its property ; but not for the purpose of continuing, under the laws of this State, the business for which it was established. Constructed from section two, chapter 97, Laws of 1865. State of Ivew Yoke. 91 § 169. When a bank, at a meeting of the stockholders, Notice ot has voted, bj two-thirds its number of shares, to become LatlonX^ baak. such association, or its directors have procured in writing the authority of the owners of two-thirds of its capital stock, to make the certificate required therefor by the laws of the United States, or shall, by a vote of a major- ity of the directors, have decided to make the change au- thorized in the discretion of such directors, such bank shall be deemed to have decided to become a banking as- sociation under the laws of the United States ; and the cashier shall publish notice thereof for thirty days in such newspaper as the directors may select, and send like printed notice by mail or otherwise to all non-voting or dissenting stockholders, and shall also notify the superin- tendent of the banking department of this State that said bank has decided to become a banking association under the laws of the United States. Constructed from section three, chapter 97, Laws of 1865. § 170. In case of a meeting of the stockholders of any stock- holders such bank as aforesaid, each stockholder shall be allowed may vote ' by proxy, to cast one vote for every share of such capital so held by him or her and may vote by proxy ; and any executor, administrator or trustee holding any such share may vote personally or by proxy, without incurring any personal responsibility by said vote. Constructed from section four, chapter 97, Laws of 1865. § 171. When the charter of any bank is surrendered when cliarter as provided in section one hundred and sixty-eight of ^"^"3°" this act, the members of the board of directors last in directors continue office shall continue to be the board of directors of the ^ra'ot'^*' J. 1 °®^ asso- new association to be formed under the laws 01 the elation. United States, with power to take all necessary meas- 93 Banking Laws of the iires to carry out and perfect such organization, by sign- ing the articles of association and the organizing certifi- cate, and adopting such regulations as may be deemed just and proper, and not inconsistent with the acts of congress in relation thereto. Constructed from section five, chapter 9T, Laws of 1865. May re- 8 172. The board of directors of such new association duce capi- tal stock, jjjg^y. j.g(j^ge ^]jg capital stock of said bank to its par value, by dividing the surplus among its stockholders or ' may retain such portion of such surplus as they may deem necessary ; and in case of an increase of the capital stock, under the provisions of the act of congress, may charge the shares of such increased capital stock with a like amount, to place the whole of such capital stock on an equality; and may award such new stock, or such pro- portion or fractional parts thereof, to such persons as they shall determine are entitled thereto as provided in their articles of association and in the acts of congress passed in relation thereto, provided, however, that new directors may be chosen at such time and in the manner provided in the articles of association and the acts of congress aforesaid. Constructed from section five, chapter 97, Laws of 1865. Directors § 173. When any bank has decided to become a bank- shaUtrans- ^mp°troi- ^"S association under the laws of the United States, it rency*""" shall be the duty of the directors immediately thereafter proper "' certificate, ^o proceed to execute and transmit to the comptroller of the currency the proper certificate and other instruments for its conversion into a national banking association under the laws of the United States ; and as soon there- after as any such bank shall obtain the certificate of the comptroller of the currency authorizing it to commence State op New Yoek. 93 the biisinesB of banking under the laws of the United States, all the assets, real and personal, of the said bank shall immediately, by act of law, and without any con- veyance or transfer, be vested in and become the prop- erty of the national banking association into which said bank shall have been converted; and it shall be enti- tled, on returning the bills of such bank to the banking To be sub- department of this State, to receive the stocks pledged to asltate'^^ banks in secure the redemption of the same, in the like manner f?J'-, ^ ' tion of cir- as the bank issuing the same is now entitled by law ; and under ° •' State law. shall be subjected to the same rules as State banks in respect to the final redemption of the circulating notes of such State banks so converted into national associations. Constructed from section six, chapter 97, Laws of 1885. § 174. The plates and dies of any bank so converted Piates and dies of old into a national association, and now in the banking ^^^g^'^*|f° department of this State, shall be forthwith so obliter- ated as to prevent all future use of the same, as provided by section eighty of this act, and any use of them in the manufacture of notes or bills shall be punished as a mis- demeanor, on conviction, by any court having cognizance thereof. Constructed from section seven, chapter 9T, Laws of 1865. 8 175. Nothins; in this act shall be construed as releas- obligation " ° to pay lia- ing such association from its obligations to pay and dis- state^ba^nk not re- charge all the liabilities created by law or incurred by leased. the bank before becoming such association, or any tax imposed by the laws of this State up to the date of its becoming snch association, in proportion to the time since the next preceding payment therefor. Constructed from section eight, chapter 97, Laws of 1865. 94 BAifKiNG Laws of the state § 176. Any State bank whieli Kas before the passage vertedfn"-" of this act become a national association, by complying the beneflt with the provisions of the acts of congress in relation ot this act. ^ thereto, shall be entitled to all the benefits and subject to the provisions of this act, in reference to such change, the same as if such conversion had been made after the passage of the same; and may amend or supply any imperfect paper, act or proceeding heretofore taken or omitted, so as to conform the same with the aforesaid provisions of this act, without invalidating its conversion from a State to a national association heretofore made. Constructed from section nine, chapter 97, Laws of 1865. National * § ^'^'^- Whenever any banking association, organized solving and doing business under the laws of the United States aforesaid shall, under the provisions of any act of con- gress, be authorized to dissolve its organization as such national banking association, and shall have taken the action required to effect such dissolution, it shall be law- ful for a majority of the directors of such dissolved organization, upon the authority in writing of the own- ers of two-thirds of its capital stock, to execute the cer- tificate of association required by section thirty of this act. Constructed from section one, chapter 475, Laws of 1867. FiUn cer- § ^'^^' ^V°^ ^^^ execution and proofs of aeknowledg- withsu- ment of such certificate as required by section thirty perintend- ent shall aforesaid, which certificate shall further declare the be re- ■ ' §ank1ng^ authority derived from the stockholders pursuant to the association of to^s'*™ provisions of the preceding section, and upon filing a copy thereof in the ofiice of the superintendent of the banking * For blank form of certificate for converting from the national to the State system, see page 264. may organ- ize as State bank. State of New York. 95 department, with proof that the original is duly recorded in the office of the clerk of the county where any office of such banking association shall be located, such associ- ation shall be held and regarded as a banking association under and in pursuance of the laws of this State, and shall be entitled to all the privileges and be subject to all the liabilities of such banking associations; and there- Property ° 'to pass by upon all the assets, real and personal, of the said dissolved of Taw.'°° national banking association shall immediately, by act of law, and without any conveyance or transfer, be vested in, and become the property of such State banking asso- ciation ; and the directors of the dissolved, organization at the time of such dissolution shall be the directors of the association created in pursuance hereof, until the first annual election of directors thereafter, and shall have power to take all necessary measures to perfect its organization, and to adopt such regulations concerning its business and management as may be proper and just, and not inconsistent with the banking laws of this State. Constructed from section two, chapter 475, Laws of 1867. CHAPTER VIII. Kegulations in Kblation to Moneyed Coepoeations. Section 179. Restrictions on moneyed corporations. 180. Profits, how calculated. 181. Surplus profits. 182. Losses, how to be charged. 183. Loans, when to be called in. 184. Proceedings on stock hypothecated when debt is not paid. 185. Certain conveyances for use of corporation invalid. 186. Certain conveyances by corporation invalid. 187. Same continued. 188. Penalty on director violating preceding sections. 96 Banking Laws of the Section 189. Prohibition on corporations having banking powers. 190. Prohibition on same and their officers. 191. Same continued. 192. Affidavits required before commencing business. 193. How made and filed. 194. Penalty if not made. 195. Election of directors. Inspectors. 196. Vacancies, how supplied. 197. Disability. 198. Oath of Inspector. 199. Who may vote. 200. And on what stock. 201. Same continued. 202. Challenge. Oath. 203. Persons voting on proxies. 204. Their oath if challenged. 205. Proceedings on challenge. 206. Proceedings if election be not held. 207. Certain by-laws invalid. 208. Transfer book of stock. 209. Penalty for refusing to exhibit books. 210. Remedy for persons aggrieved by election. 211. Proceedings. 212. Same continued. 213. Same continued. 214. "Moneyed corporations" defined. 215. This chapter how applied. 216. "Directors" defined. 217. " Effects " defined. 218. "Evidence of debt" defined. Eestric- *§ ^'^^- -'-*' ^^^^^ °°^ ^^ lawful for the directors of any tions on ^ moneyed moneyed corporation : corpora- "^ ^ tions. 2_ ijiq make dividends, except from the surplus profits arising from the business of the corporation. 2. To divide, withdraw, or in any manner pay to the stockholders, or any of them, any part of the capital stock of the corporation, or to reduce such capital stock without the consent of the legislature. * state banks not subject to the provisions of this section, see opinion of attorney-general, page 440. Section 57 ante, provides that banks organized under the banking laws of this State shall be subject to the provisions of sections 195 to 213, inclusive, of this act. The reasons given by the attorney-general for arriving at the conclusion that section 179 is not applicable to banks, apply with equal force to sections 180 to 194 both inclusive, see opinion of that officer, page 440. State of New York. 97 3. To discount or receive any note or other evidence of debt, in payment of any installment actually called in and required to be paid, or with the intent of providing the means of making such payment. 4. To receive and discount any note or other evidence of debt, with the intent of enabling any stockholder to withdraw any part of the money paid in by him on his stock. 5. To apply any portion of the funds of the corpora- tion, except surplus profits, directly or indirectly, to the purchase of shares of its own stock. 6. To receive any such shares in payment or satisfac- tion of any debt due to their corporation, except as here- inafter provided. 7. To receive from any other stock corporation, in exchange for the shares, notes, bonds or other evidences of debt of their own company, shares of the capital stock of such other corporation, or notes, bonds, or other evi- dences of debt, issued by such other corporation. 8. To make any loans or discounts, if the corporation have banking powers, by which the whole amount of the loans and discounts of the company shall be made to exceed three times its capital stock, then paid in, and actually possessed. 9. To make any loans or discounts to the directors of such corporation, or upon paper upon which such directors, or any of them, shall be responsible, to an amount exceed- ing, in the aggregate, one-third of the capital stock of such corporation, actually paid in and possessed ; but no securities taken for any such loan or discounts shall be held invalid. Constructed from section one, article 1, title 2, chapter 18, part 1, Revised Statutes. 13 98 Bankimg Laws of the Profits, 8 180. In the calculation of the profits of any moneyed how oal- ° 1-1 cuiated. corporation previous to a dividend, interest then unpaid, although due or accrued on debts owing to the company, shall not be included. Constructed from section two, article 1, title 2, chapter 18, part 1, Revised Statutes. Surplus § 181. In order to ascertain the surplus profits from ^^° ^ which alone a dividend can be made, there shall be charged in the account of profit and loss, and deducted from the actual profits : 1. All the expenses paid or incurred, both ordinary and extraordinary, attending the management of the affairs and the transaction of the business of the com- pany. 2. The interest paid or then due or accrued on debts owing by the company. 3. All losses sustained by the company ; and in the computation of such losses, all debts owing to the com- pany shall be included, which shall have remained due, without prosecution, and no interest having been paid thereon for more than one year ; or on which judgments shall have been recovered that shall have remained for more than two years unsatisfied, and on which no interest shall have been paid during that period. Constructed from section three, article 1, title 2, chapter 18, part 1, Re- vised Statutes. Losses, § 182- When any losses shall be sustained by any such charged, corporation that shall exceed its undivided profits then realized and possessed, they shall be charged as a reduc- tion of the capital stock of the company, and no divi- dend shall thereafter be made on the shares of siich stock until the deficit of capital so created shall be made good. State of New Yoek. 99 either by the recovery of the moneys charged as lost, or from the subsequently accruing profits of the company. Constructed from section four, article 1, title 2, chapter 18, part 1, Re- vised Statutes. §183. If from the occurrence of losses charged, or^J*°^jg^g proper to be charged, as a reduction of its capital stock, " ® "■ the whole amount of the loans and discounts made by any corporation having banking powers shall exceed three times the amount to which its capital paid in is or ought to be reduced, it shall be the duty of the directors of such corporation to call in and cause to be paid, with- out delay, such a portion of such loans as shall reduce their whole amount within the limits before prescribed. Constructed from section five, article 1, title 2, chapter 18, part 1, Re- vised Statutes. S 184. If an 7 shares of its own capital stock shall be Proeeed- c >/ J. ings on hypothecated or pledged to any moneyed corporation, h^othe- cated and the debt which they shall be intended to secure y^en debt •^ IS not shall not be paid when due, it shall be the duty of the ^*' ' directors of the company, within sixty days thereafter, to cause such shares to be sold ; and if, within that period, such shares shall not be sold, and the debt shall remain unsatisfied, the shares shall be charged at the amount actually paid thereon, as a reduction of the capital stock of the company, and no dividend shall thereafter be made, until the deficit so created be made good from the sub- sequently accruing profits of the company. Constructed from section 8ix,i article 1, title 2, chapter 18, part 1, Revised Statutes. § 185. No conveyance, assignment or transfer of any certain efEects, for the use, benefit or security of any such cor- use oV"' Doration shall be valid in law, unless it be made to the tion in-" ^ valid. corporation directly and by name ; but the provisions of 100 BAifrKiiTQ Laws or the this section shall not be construed to apply to a convey- ance or assignment for the benefit of creditors, in which such corporation shall be included, or to a conveyance or assignment of the effects of a debtor under the laws of this State, or of any other State or country. Constructed from section seven, article 1, title 2, chapter 18, part 1, Be- Tised Statutes. Certain 8 186. Hfo Conveyance, assignment or transfer, not au- convey- ./ ? o ? oorpor'a- thorized by a previous resolution of its board of directors, tion in- v^d. ,— shall be made by any such corporation of any of its real estate, or any of its efEects, exceeding the value of one thousand dollars ; but this section shall not apply to the issuing of promissory notes, or other evidences of debt, by the officers of the company in the transaction of its ordinary business, nor to payments in specie or other cur- rent money, or in bank-bills, made by such officers ; nor shall it be construed to render void any conveyance, as- signment or transfer, in the hands of a purchaser for a valuable consideration, and without notice. Constructed from section eight, article 1, title 2, chapter 18, part 1, Re- vised Statutes. Samecon- § 187. No such Conveyance, assignment or transfer, nor any payment made, judgment sufi'ered, lien created, or security given by any such corporation when insolvent, or in contemplation of insolvency, with the intent of giv- ing a preference to any particular creditor over other creditors of the company, shall be valid in law ; and every person receiving by means of any such conveyance, assignment, transfer, lien, security or payment, any of the effects of the corporation shall be bound to account therefor to its creditors or stockholders, or their trustees, as the case shall require ; and whenever any incorporated company shall have refused the payment of any of its State of New York. 101 notes, or other evidences of debt, in specie or lawful money of the United States, it shall not be lawful for such company, or any of its officers, to assign or transfer any of the property or choses in action of such company to any officer or stockholder of such company, directly or indirectly, for the payment or any debt ; and every such transfer and assignment to such officer or stockholder shall be utterly void. Constructed from section nine, article 1, title 2, chapter 18, part 1, and section four, title 4, chapter 18, part 1, Revised Statutes. S 188. Every director who shall violate, or be con- Penalty on ° •' ' director cerned in violating, any provision in the preceding sec pre&edi^ sections, tions of this chapter contained shall be liable personally to the creditors and stockholders respectively, of the cor- poration of which he shall be a director, to the full extent of any loss they may respectively sustain from such vio- lation. Constructed from section ten, article 1, title 2, chapter 18, part 1, Revised Statutes. § 189. No corporation having banking powers shall ProUbi- issue for circulation any bill or promissory note of a less ''*°''^' denomination than one dollar. Constructed from section twenty-six, article 1, title 2, chapter 18, part 1, Revised Statutes. § 190. No corporation having banking powers, andProhiW- none of its directors, officers, agents or servants, shall, their^ """^ directly or indirectly, purchase or be interested in the purchase of any promissory note, or other evidence of debt, issued by such corporation, for a less sum than shall appear on the face thereof to be then due; and every person violating the provisions of this section shall forfeit 102 Banking Laws of the three times the nominal amount of the note, or other evidence of debt, so purchased. Constructed from section twenty-seyen, article 1, title 2, chapter 18, part 1, Bevised Statutes. Prohibi- § 191. No president, director, cashier, clerk or agent tion on 1.11. banks and of any Corporation having banking powers, and no person officers, -jj g^j^y ^^^ interested or concerned in the management of the affairs of any such corporation, shall discount, or di- rectly or indirectly make any loan, upon any note or other evidence of debt, which he shall know to have been offered for discount to the directors, or any officer of such corporation, and to have been refused ; and every person violating the provisions of this section shall, for. each offense, forfeit twice the amount of the loan which he fhall have made. Constructed from section twenty-eight, article 1, title 2, chapter 18, part 1, Bevised Statutes. Affidavits § 192. No moneyed corporation shall commence the required com™ business for which it shall be incorporated, until its presi- bus?neBs dent and cashier, or treasurer, or secretary, or its two principal officers, by whatever name they may be de- scribed, shall have made and subscribed an affidavit, stating that the whole of the capital stock of such corporation, or such portion thereof as, by its charter, shall be required to be paid or secured before the commencement of its operations, has been actually paid, or secured to be paid, according to the provisions of its charter. Constructed from section twenty-nine, article 1, title 2, chapter 18, part 1, Bevised Statutes. How made § 193. Every such affidavit, if made in a city, shall be and filed. "^ ' made before the mayor or recorder of such city, and if made in a county, before the county judge of the county, or any justice of the supreme court therein, and shall be State of New York. 103 filed in the clerk's ofiice of the city and county, or of the county in which it shall be taken. Constructed from section thirty, article 1, title 2, chapter 18, part 1, Re- vised Statutes. § 194. The charter of every such corporation shall be no°^aV/ void, if the afiidavit above required shall not be duly made and filed within one year from the time such char- ter shall be granted. Constructed from section thirty-one, article 1, title 2, chapter 18, part 1, Revised Statutes. *§ 195. At every election for directors in any moneyed Election of corporation, three persons shall be chosen by the persons entitled to vote for directors, as inspectors, at the next succeeding election, whose duty it shall be to act as such, and any two of whom shall be competent to act. Each inspectors acting inspector shall be entitled to a reasonable com- ''''°^^°" pensation for his services, to be paid by the corporation for which he is chosen. Constructed from section thirty-four, article 2, title 2, chapter 18, part 1, Revised Statutes. 8 196. The directors of the corporation shall supply Vacancies, any vacancy that may occur by the death or removal from p"®*^- the city or county where the corporation shall be situated, of any such inspector, or by his refusal to serve, or neglect to attend on the day of election. Constructed from section thirty-six, article 2, title 2, chapter 18, part 1, Revised Statutes. § 197. No person shall be chosen or appointed an in- Disability, specter of an election of directors in a corporation of which he shall be a director or officer. Constructed from section thirty-six, article 2, title 2, chapter 18, part 1, Revised Statutes. * For supplemental statute see chapter 489, Laws of 1885, page 211. See note to section 179, ante, page 96. lOd Banking Laws of the Oath of In- § 198. Every sueh inspector, before he shall enter on the duties of his ofiS.ce, shall take and subscribe the follow- ing oath, before any officer authorized by law to admin- ister oaths : " I do solemnly swear that I will execute the duties of an inspector of the election now to be held, with strict impartiality and according to the best of my ability." Constructed from section thirty-seven, article 2, title 2, chapter 18, part 1, Revised Statutes. Who may § 199. At every election of directors, the transfer books vote. of the corporation shall be produced, to test the qualifica- tions of the voters ; and no person shall be admitted to vote, directly or by proxy, except those in whose names the shares of the stock of the corporation shall stand on such books, and shall have so stood for at least thirty days previous to the election. Constructed from section thirty-eight, article 2, title 2, chapter 18, part 1, Revised Statutes. on what § ^^^' ^^ pcrson shall be admitted to vote on any shares of stock belonging, or hypothecated to the corpo- ration in which the election is held, nor shall any person be admitted to vote on any shares of stock which shall then be hypothecated, or pledged as a collateral security to any other person or company. Constructed from section thirty-nine, article 2, title 2, chapter 18, part 1, Revised Statutes. Who may § 201. No person shall be admitted to vote on any vote, ana on what shares which shall have been transferred to him, for the atooks. ' sole purpose of enabling him to vote thereon, at the elec- tion then to be held ; nor upon any shares which he shall have previously contracted to sell or transfer after the election, upon any condition, agreement or understanding in relation to his manner of voting at such election. Constructed from section forty, article 2, title 2, chapter 18, part 1, Re- vised Statutes. State of New Yobk. 105 § 202. Every person offering to vote may be challenged Challenge, by any other person authorized to vote at the same elec- tion ; and to every person so challenged one of the in- spectors shall administer the following oath: " You do Oath, swear (or affirm, as the case may be), that the shares on which you now offer to vote do not belong and are not hypothecated to the (naming the corporation for which the election is held), a,nd that they are not hypothecated or pledged to any other corporation or person whatso- ever ; that such shares have not been transferred to you for the purpose of enabling you to vote thereon at this election, and that you have not contracted to sell or transfer them, upon any condition, agreement or under- standing, in relation to your manner of voting at this election." Constructed from section forty-one, article 2, title 2, chapter 18, part 1, Eevised Statutes. § 203. No person shall be permitted to vote on the person voting on proxy of a stockholder, unless he shall produce, annexed proxies, to his proxy, an affidavit of such stockholder, stating the same facts to which the oath of such stockholder might have been required, upon a challenge, had he offered to vote in person upon the shares mentioned in the proxy. Constructed from section forty-two, article 2, title 2, chapter 18, part 1, Revised Statutes. § 5i04. If any person offering to vote upon a proxy shall oath' if be challenged by an elector, he shall be required to take the following oath, to be administered to him by one of the inspectors : " You do swear (or affirm) that the facts stated in the affidavit annexed to the proxy upon which you now offer to vote are true according to your belief, and that you have made no contract or agreement what- 106 Bankijstg La^vs of the ever, for tlie purchase or transfer of the shares, or any portion of the shares, mentioned in such proxy." Constructed from section forty-three, article 2, title 2, chapter 18, part 1, Revised Statutes. Proceed- 8 205. If any person auly challenged shall refuse to inp:s on *^ *' ^ •' ^ c aiienge. ^^-^^ ^-^^ proper oath, his vote shall be rejected, and shall not be afterward received at the same election ; if he shall take the oath, his vote shall be o-eceived. Constructed from section forty-four, article 2, title 2, chapter 18, parti. Revised Statutes. Proceed, § 206. If an election for directors in any such corpora- ings if not'heid''^ tion shall not be held on the day appointed by law, it shall be the duty of the directors to notify, and cause such election to be held within sixty days after the day so ap- pointed ; and on the day so notified, no person shall be admitted to vote, except those who would have been en- titled, had the election taken place on the day when, by law, it ought to have been held. Constructed from section forty-fire, article 2, title 2, chapter 18, part 1, Revised Statutes. Certain § 207. No by-law of any such corporation, regulating Invalid, ^j^g election of its directors, shall be valid, unless it shall be made at least sixty days before the day appointed by law for the election to be held, and shall have been pub- lished for at least two weeks in succession immediately following its enactment, in some newspaper in the city or county where the corporation is situated. Constructed from section forty-six, article 2, title 2, chapter 18, part 1, Revised Statutes. Transfer 8 208. Everv such corporation shall keep a book, in book of a ., r r i stock. which the transfer of shares of its stock shall be regis- tered; and another book, containing the names of its stockholders ; which books shall at all times during the State of New Yobk. 107 usual hours of trausactiug business, for thirty days pre- vious to an election of directors, be open to the examinar tion of the stockholders. Constructed from aeotioa forty-seven, article 2, title 2, chapter ]8, part 1, Revised Statutes. § 209. If any oiBcer having charge of such books shall, Penalty for o J o a ' refusing to upon the demand of a stockholder, refuse or neglect to *^ exhibit and submit them to examination, he shall for each offense forfeit the sum of two hundred and fifty dollars. Constructed from section forty-eight, article 2, title 2, chapter 18, part 1, Revised Statutes. S 210. If any person shall conceive himself agarrieved Remedy of " ■' "^ °° persons by an election, or any proceeding concerning an election bpel'eotlon of directors or officers of any such corporation, he may apply to the supreme court for redress, giving a reason- able notice of his intended application, to the party to be affected thereby. Constructed from section forty-nine, article 2, title 2, chapter 18, part 1, Revised Statutes. § 211. It shall be the duty of the supreme court, upon Proceed- such application, to proceed forthwith in a summary way to hear the proofs and allegations of the parties, or other- wise to inquire into the causes of complaint, and there upon to make such order, and grant such relief, as the circumstances and justice of the case shall seem to require. If the election complained of shall be set aside, the supreme court may order a new election, at such time and place as they shall appoint. Constructed from section fifty, article 2, title 2, chapter 18, part 1, Re- vised Statutes. S 212. The supreme court, if they cannot otherwise Proceed- ings. arrive at a satisfactory result, may order an issue between the parties, to be made up in such manner and form, and 108 BAifKiNG Laws of the to be tried in such court, as they shall select ; or may per- mit or direct the attorney-general to file an information in the nature of a quo warrcmto, if the case be one in which that proceeding would be competent and effectual. Constructed from section fifty-one, article 2, title 2, chapter 18, parti, Eevised Statutes. Proceed- g 213. If any such issue shall be ordered, or informa- tion permitted or directed to be filed, it shall be the duty of the supreme court to make such further orders in re- lation to the time and mode of pleading, the examination of witnesses or the parties, the production of books and papers, and the time and place of trial or hearing, as shall in their judgment be effectual for expediting the proceedings, saving expense to the parties, and causing a final determination to be had with as little delay as the nature of the controversy will permit. Constructed from section fifty-two, article 2, title 2, chapter 18, part 1, Revised Statutes. oOTporT*'* § 214. The term " moneyed corporation," as used in fined. " this chapter, shall be construed to mean every corpora- tion having banking powers, or having the power to make loans upon pledges or deposits, or authorized by law to make insurances. Constructed from section fifty-four, article 3, title 2, chapter 18, part 1, Eevised Statutes. This § 215. The provisions of this chapter shall not apply chapter, to, ■, ^. •^. ,, ,. , ^. what por- to any moneyed corporation existing on the first day of applied. January, one thousand eight hundred and twenty-eight ; but they shall be construed to apply to every moneyed corporation created, or whose charter shall be or shall have been renewed or extended after that time, unless such corporation shall be expressly exempted from the State op New York. 109 said provisions in the act creating, renewing or extending such corporation. Constructed from section fifty-five, article 8, title 2, chapter 18, part 1, Revised Statutes. § 216. The term " directors," as used in this chapter, ^'°',T^."*- shall be construed to embrace all persons having by law °* ' the direction or management of the affairs of any such corporation, by whatever name they may be described in its charter, or known in law. Constructed from section fifty-six, article 3, title 2, chapter 18, part 1, Revised Statutes. §217. The term "effects," as used in this chapter, ^Kierts" shall be construed to embrace every species of property, real and personal, including things in action. Constructed from section fifty-aeven, article 3, title 2, chapter 18, part 1, Revised Statutes. § 218. The term " evidence of debt," as so used, shall ee^'<5^*°" , 1,1 . ■ debt " de- be construed to embrace every written instrument or fined. security, for the payment of money, importing on its face the existence of a debt, and whether under seal or other- wise. , Constructed from section fifty-eight, article 3, title 2, chapter 18, part 1, Revised Statutes. CHAPTER IX. Moneyed Coepoeations othbe than Banks, Institu- tions FOE Savings and Instieance Companies. Section 219. Reports to superintendent. 220. Publication of same. 221. Examinations by superintendent. 222. Scope of examination. 223. Duty of superintendent if corporation unsound or business improperly conducted. 224. Deposit of securities with superintendent. 110 Banking Laws of the Sectiok 225. Injunction on neglect to make deposit. 226. Assessment for expenses of department. 227. Restriction as to loans and deposits. 228. Capital may be reduced but not below one hundred thousand dollars. 229. Notice of intention to reduce. Examination. 230. Certificate of reduction to be recorded and published. 231. Liability of stockholders and rights of creditors unchanged. 232. Capital may be increased. 233. Impairment of capital; ninety days to make good deficit. 234. Report by superintendent to legislature. Keporta *§ 219. Everj trust, loan, mortgage, security, guarantee the'luper- Or indemnity company or association, and every corpora- intendent i . i i ■ • of the tion or association having the power and receiving money ment.'' on deposit, existing or incorporated under any law of this State, or any corporation or association not incorporated under the laws of this State which receives deposits of money or assumes obligations in this State (other than banks, institutions for savings and insurance companies), shall semi-annually make a full report in writing of the affairs and conditions of such corporation at the close of business on the last business days of June and December in each year, to the superintendent of the banking de- partment, verified by oath, in such form and by such officers of the said corporation as the said superintendent may designate, which report shall be in place of any report which any such corporation has been heretofore required to make to the supreme court, the comptroller or other- wise. Every such report shall be made within twenty days after the day to which it relates, and shall be in such form and contain such statements, returns and informa- tion as to the affairs, business, condition and resources of such corporation as the said superintendent may from time to time prescribe or require. And the said superin- * For opinions by the attorney-general on questions relating to trust, loan, mortgage, security, guarantee or indemnity companies, or associations, see pages 451 to 477. State of New Yoke. Ill tendent may, if he be of opinion that it is desirable, re- quire that a like report, either wholly or in part, as to the particulars aforesaid, be made to him at any time, by any such corporation aforesaid, within such period as he may designate. Constructed from seition one, chapter 324, Laws of 1874. For general trust company law, see chapter 546, Laws of 1887, page 230. Relating to iurestments by trust companies, see chapter 482, Laws of 1868, page 229. Trust companies may be appointed guardian, etc., of lunatics, etc., see chapter 425, Laws of 1885, page 229. Foreign corporations authorized to purchase real estate in this State, see chapter 158, Laws of 1877, page 248. Change of corporate name of a trust company, see chapter 518, Laws of 1887, page 227. Relating to examinations of trust companies, see section 12, ante, as amended by chapter 47, Laws of 1884. § 220. The said superintendent may at any time, if he Pubiica- deem it to be expedient, cause any such statement, or any '■8P°"s- statement or report which may be made to him as pro- vided in the preceding section of this act, or any part or any abstract thereof, to be published in the State paper for at least three times, the expense of which shall be paid by the corporation to whose affairs such report may relate. Constructed from section two, chapter 324, Laws of 1874. *§ 221. It shall be the duty of the said superintendent, Examina- tion by yearly, either personally or by some competent person or !"P|'''°'" persons to be appointed by him, to visit and examine every corporation required to report by section two hun- dred and nineteen of this act. The said superintendent and every such examiner shall have power to admin- ister an oath to any person whose testimony may be required on any such examination, and to compel the * For present provisions governing examinations see section twelve, ante^ as amended by chapter 47, Laws of 1884, page 7. 112 Banking Laws of the appearance and attendance of any such person for the Witnesses purpose of such examination, by summons, subpoena or may be ^oenaed attachment, in the manner now authorized in respect to tmined. the attendance of persons as witnesses in the courts of record of this State ; and all books and papers which it may be deemed necessary to examine by the superintend- ent or the examiner or examiners so appointed shall be produced, and their production may be compelled in the like manner. The expense of every such examination shall be paid by the corporation examined to such amount as the superintendent shall determine. Whenever such examination shall be made by the superintendent per- sonally, or by one or more of the regular clerks in his department, no charge shall be made on such examina- tion but for necessary traveling and other actual expenses. Constructed from section three, chapter 324, Laws of 18T4. § 222. On every such examination inquiry shall be made as to the condition and resources of the corpora- tion generally, the mode of conducting and managing its affairs, the action of its directors or trustees, the in- vestment of its funds, the safety and prudence of its management, the security afforded to those by whom its engagements are held, and whether the requirements of its charter and of law have been complied with in the administration of its affairs. Constructed from section four, chapter 824, Laws of 18?4. § 223. If it shall appear to the said superintendent, from an examination made by him, or from the report of any examination made to him, that any corporation has committed a violation of its charter or of law, or is con- ing busi- ducting business in an unsafe or unauthorized manner, ness In »n '^ ' he shall, by an order under his hand and seal of office Expense Scope of examina- tion. Duty of superin- tendent when corpora- tion has violated charter or law, or is conduct- unsafe manner. State of New York. 113 addressed to such corporation, direct the discontintiance of such illegal or unsafe practices, and conformity with the requirements of its charter and of law, and with safety and security in its transactions; and whenever any corporation shall refuse or neglect to make such re- port as hereinbefore required, or to comply with any such order as aforesaid ; or whenever it shall appear to the superintendent that it is unsafe or inexpedient for any corporation to continue to transact business, he shall communicate the facts to the attorney-general, who shall thereupon be authorized to institute such proceedings against any such corporation as are now, or may here- after be, provided for by law in the case of insolvent corporations, or such other proceedings as the nature of the case may require. Constructed from section five, chapter 324, Laws of 1874. § 224. Every corporation, whether chartered by this Transfer State, or any other State or country, engaged in receiving "r mort^ ™ gagss to deposits of money in trust in this State, and required to ti^e super- make a report, as to its affairs, by section two hundred'"""^*' and nineteen of this act, in case it shall not have already done so, shall, within six months from the passage of this act, and from time to time thereafter, if need be, transfer and assign, to the said superintendent, registered public stocks of the United States, or of the State of New York, or of any incorporated city of this State, au- thorized by the legislature, to the amount in value (and to be at all times so maintained by said corporation) of ten per centum on the paid-up capital stock of said cor- poration, now or at any time hereafter, but not less, in any case, than fifty thousand dollars, which stocks must be registered, in the name of the said superintendent, 15 114 Baitking Laws of the officially, as held in trust under and pursuant to this act, and the same shall be held by the said superintendent in trust, as security for the depositors with, and creditors of, said corporation, and subject to sale and transfer, and to the disposal of the proceeds by the said superintendent, only on the order of any court of competent jurisdiction ; and, until the order of such court, authorizing such sale or transfer, or otherwise to the contrary, the said super- intendent shall pay over to such corporation the interest which may be received on the said securities, or he may authorize the said corporation to collect and receive the same for its own benefit. Should any company, at any time, have deposited with the superintendent more than the amount hereby required, such excess may be re- funded. With the approval of the superintendent, such deposit may be made by any company, either wholly or in part in bonds and mortgages satisfactory to the said superintendent, on improved, unincumbered, produc. tive real estate in this State worth at least twice the amount loaned thereon ; and all the provisions of this section shall apply to such deposit. Constructed from section six, chapter 324, Laws of 1874. In case of § 226. In case any corporation doing business in tnis neglect to ^ i o "oaHf^ti, State, not chartered under the authority of this State, tendent shall refuse or neglect to mate the deposit with the said business ^ "n^lined. Superintendent, hereinbefore required, the fact shall be reported by the said superintendent to the attorney-gen- eral, who shall thereupon without delay take such pro- ceedings as may be necessary to enjoin and restrain such corporation from transacting any business in this State, and the court to which such application shall be made shall be authorized to make such order or decree, and to State of New Yoek. 115 issue such process in the premises to enforce compliance by such corporation with the provisions of this act, or to restrain the transaction of business by such corporation in this State, as it may deem proper. Constructed from section seven, chapter 824, Laws of 1874. § 226. Every corporation, subject to the provisions of Assess- ment for section two hundred and nineteen of this act, shall be expenses ofbank- assessed by the said superintendent to pay its proper pro- pmment. portion of the expenses of conducting the business of the banking department, as provided for by section six of this act, and shall be considered in all respects as em- braced within the provisions of the said section. Constructed from section eight, chapter 324, Laws of 1874. § 227. The amount of money which any such corpora- Kestric- tion as to tion shall have on deposit or loan at any time shall not o" deposit exceed ten times the amount of its paid-up capital and surplus, and its outstanding loans shall not at any time exceed said amount ; but any such corporation authorized to receive court deposits may at any time receive on de- posit and loan out any money which may be deposited with it by any of the courts of the State, including the surrogate's court, notwithstanding such limitation. Constructed from section nine, chapter 324, Laws of 1874. *S 228. It shall be lawful for any trust companv or capital ° •' t- J stock may other moneyed corporation required to report to the su-duced, but perintendent of the banking department by section two «ioo,ooo. hundred and nineteen of this act, organized under the laws of this State, to reduce its capital stock to an amount which shall be equal to the value of the property and eflfects of such company, over and above its debts and liabilities, and thenceforth the capital stock of such com- * See section 43, page 27, aite. 116 Banking Laws op the pany shall be sucli reduced amount, and the par value of the shares thereof shall be reduced in the same propor- tion ; but in no case shall such capital stock be reduced below one hundred thousand dollars. Constructed from section one, chapter 274, Laws of 1878. Notice of § 229. "Whenever a trust company shall propose to gwen sup- reduce its capital stock, due notice thereof shall be given erintend- . /■ i i i ■ i ent with to tUe Superintendent of the banking department, signed oTstook^ by a majority of its board of trustees, and accompanied by the written assent, duly acknowledged or proven, to such reduction, of at least two-thirds in amount of the shareholders of such company, and it shall be the duty of the said superintendent, on the receipt and filing of snch notice, and within a reasonable time thereafter, to make or cause to be made an examination of the books, prop- erty, effects and liabilities of such company, upon which examination the officers of such company may be exam- ined on oath as to the debts, liabiHties, property and ef- fects thereof. From the result of such examination the Examina^ Said Superintendent shall determine the value, in his tion to be future cap- judgment, of such property and effects, above and beyond italtobe ,,.,.,.. deter- the debts and nabihties aforesaid, and certify the same in mined '^ therefrom, writing ; and the amount so determined and certified shall be thereafter the capital stock of such company, provided such amount be not less than one hundred thousand dollars, and the par value of the shares thereof shall be proportionably reduced. Constructed from section two, chapter 274, Laws of 1878. Certificate § 230. The determination and certificate in wiitine of of reduced ° ° cap^itaito ^jjg superintendent of the amount to which the capital and pub- stock of any such corporation has been reduced shall be recorded in the oflSce of the clerk of the countv in which State of New York. 117 Buch company shall be located, and a certified copy- thereof filed in the banking department of the State of New York, and the same shall be published by said su- perintendent at the expense of such company, once a week for six weeks successively, in the State paper, and at least one newspaper in the county in which such com- pany shall be located. Constructed from section three, chapter 274, Laws of 1878. § 231. Nothing in this act contained shall in any way Liability of •' •' atocls- change or affect the liability of the stockholders of any and^righta corporation reducing its capital stock to any of the credit- tors un-" changed. ors thereof for any indebtedness or engagement that may exist, either absolutely or contingently, against such company or stockholders, at the time when such reduc- tion shall take place, nor shall the rights, remedies or securities of the then existing creditors be in any way weakened or impaired thereby. Constructed from section four, chapter 274, Laws of 1878. § 232. Any such corporation that may reduce its capital may be capital stock under the foregoing provisions may, after increased, such reduction has been made, increase its capital stock: to a sum not exceeding the amount provided in the charter of such company, or any act amendatory thereof. Such increase shall be apportioned among the then stock- holders of such company, who shall severally be notified in writing of such apportionment. And such notification Notice to be given shall be mailed to or delivered at the last known resi- superi"- tenaent dence of each shareholder. And if they or any of them holders, shall not within one month after service of such notice accept the amount so apportioned, then such increase or the amount not accepted by the stockholders may be sold and distributed by the board of trustees of such company 118 Banking Laws os the in such manner as such board shall determine. Upon the payment to the company in money of such increased capital, the board of trustees shall certify to the said su- perintendent of the banking department the said increase Increase to of capital and the payment thereof, and it shall be the "^ ■ duty of the superintendent to require evidence satisfac- tory to him that the increased capital of such company has been actually paid in in money, and such proof shall be in writing and shall be filed in the banking depart- ment. Constructed from section five, chapter 274, Laws of 1878. When § 233. Whenever it shall appear from any report of a to'^beTm- ti'i^st comp&ny or other moneyed corporation which is paired, ^ , superin- required to report to the supermtendent of the banking amfne^'nd department by section two hundred and nineteen of this deficit to act, or the superintendent shall have reason to believe be made ' ' ^°°^' that the capital of any such corporation is reduced by any cause below the sum fixed by its charter or by law, it shall be the duty of the superintendent, and he shall have power, to require such corporation to make good such deficit, and he shall have power to examine any such corporation, either personally or by persons appointed by him to ascertain the amount of such deficit or reduction of capital. If any such corporation shall refuse or neg- lect to make good the deficit found to exist for ninety days after such requisition has been made, it shall there- upon be the duty of the superintendent to report the facts to the attorney-general, whose duty it shall then become to institute such proceedings against such cor- poration as the nature of the case may require. Constructed from section six, chapter 274, Laws of 1878. State of New York. 119 §234. It shall be the duty of the superintendent ofsuperin- the banking department to report annually to the legisla- *" i||,gi^. ture a siimmary of the state and condition of every trust tents •' •' thereof. company, and other moneyed corporation required to report to him by section two hundred and nineteen of this act, from which reports have been received during the preceding year ; and such summary shall give the date to which such reports refer, the amount of capital returned by each of said corporations, the whole amount of its debts and liabilities, the total sum of its resources and such other information as he may deem useful ; and the superintendent shall also report to the legislature annually an abstract of the report of the regular examina- tion of every such corporation made by his direction. Constructed from section seven, chapter 274, Laws of 1878. CHAPTEK X. ^Savings Banks. Section 235. Savings banks declared corporations. Powers. 236. Thirteen associates to organize. 237. Certificate, what to contain. 238. Executed in duplicate and filed. 239. Notice of intention to organize. 240. Indorsement of certificate by superintendent. 241. Defective certificate. 242. Superintendent to ascertain facts. *In obedience to a mandate of the Constitution, the legislature, of the year 1875, passed a general law (chap. 371) for the organization and adminis- tration of the affairs of savings banks. By section 56 of that act, twenty- four enumerated laws, relating to savings banks, were repealed. Section 33 of chapter 402 of the Laws of 1882, repealed chapter 371 of the Laws of 1875. By such repeal, each of the twenty-four laws repealed by section 56 of chap- ter 371 of the Laws of 1875, have been revived, and are. now of full force and effect; it being a principle well established in jurisprudence, that the repeal of a repealing act, revives the original statute. 130 Banking Laws op the Sbction 243. Certificate of authorization. 244. Same to be filed. 245. Refusal of authorization. 246. Persons named in certificate a body corporate 247. Names of officers, place of business, etc. 248. Business to begin within one year. 249. First trustees. 260. Thirteen trustees; elections; racancies. 251. By-laws. 252. Meetings of trustees. Quorum. 253. When oifice of trustee becomes vacant. 254. Security from officers. Salaries. 255. Prohibitions upon trustees. 256. Deposits. 257. Regulations as to deposits. 258. Deposits by minors, etc., and in trust. 259. Actions against sayings banks. 260. Investments. 261. Investments, current payments and expenses. 262. Temporary deposits by savings banks. 263. Real estate ; change of location. 264. Loans. 265. Mortgaged property ; insurance. 266. Restri»tiona as to business. 267. Interest ; depositors classified ; extra dividends. 268. Per cent of surplus, how determined. 269. Compensation of trustees. 270. Reports of superintendent. 271. Contents of reports. 272. Same. 273. Reports to be verified. 274. Failure to report ; penalty. 275. No other reports or inspection. 276. Superintendent to report to legislature. 277. Examinations. 278. Notice to attorney-general; proceedings; distribution. 279. Examination of vouchers and assets. 280. Clerks and examiners ; salaries. 281. Expenses. 282. Debts to savings banks, when preferred. 283. Unauthorized business prohibited. 284. Reduction and increase of trustees. 285. Change of name. 286. Charters to conform ; misdemeanors. 287. Evidences of deposit. 288. Misnomer. 289. This act, how construed. 290. Deposit limited to three thousand dollars, 291. Trustee must be resident of State. 292. Receiver's quarterly statement. 293. Voluntary close of business. 294. Unclaimed deposits ; dissolution. State op New York. ' 121 Section 295. Receiver's statement, and paynaent of balances to superin- tendent. 296. Superintendent to deposit unclaimed moneys, and report to legislature. *§ 235. Every savings bank or institution for savings, btnif^a now existing, or which may hereafter be organized under be^oor- " poratloQS. and by virtue of any law of this State, is hereby de- clared to be a corporation possessed of the powers and functions of corporations generally, and as such shall have power : 1. To have perpetual succession by its corporate name. <^eDerai r r t/ r powers. 2. To sue and be sued, complain and defend, in any court of law or equity. 3. To make and use a common seal, which may be af- fixed by making an impression directly on the paper, and alter the same at pleasure. 4. To appoint such officers, managers and agents as the business of the corporation may require. 5. To make by-laws not inconsistent with the laws of this State, or of the United States, for the management of its property and the regulation of its affairs. 6. To contract and be contracted with. f?. To receive money on deposit, to invest the same, and further transact the business of a savings . bank as hereinafter provided. 8. To exercise any corporate powers necessary to the exercise of the powers above enumerated and given. Constructed from section one, chapter 371, Laws of 1875. § 236. Any number of persons, not less than thirteen, Not less ^ ■' "^ ' ' than thir- may associate themselves together for the purpose of or- sSc?ates to . , , . , .11 • organize. ganizing a savings bank m accordance with the provi- * Savings banks cannot lawfully delegate their powers, see opinion of at- torney-general, page 356. + Not authorized to receive special deposits of valuables for hire, see opinion of attorney-general, page 865. 132 Banking Laws of the sions of this act ; but two-thirds of such number of per- sons shall reside in the county where the proposed bank shall be located. Constructed from section two, chapter 3Y1, Laws of 1875. foMto*'^' *§ 2^'^- Such persons, under their hands and seals, a certifi- shall execute a certificate in which shall be set forth : Gate. contain" 1- ^he name assumed to distinguish such association and to be used in its dealings, which shall be, in no ma- terial respect, similar to the name of any other savings bank organized and doing business in this State. 2. The place where its business is to be transacted, designating the particular city, village or town, and, if iu any city, the ward in such city. 3. The name, residence (if in any city, the street and number), occupation and post-office address of each mem- ber of such association. i. A declaration that each member of such association will accept the responsibilities and faithfully discharge the duties of a trustee in such institution when author- ized according to the provisions of this act. Constructed from section three, chapter 371, Laws of 1875. cuted 1?*' § 238. Such certificate shall be executed in dupHeate, and filed.' and be duly acknowledged before an officer of this State authorized to take the acknowledgment of conveyances of real estate for record, and shall, within sixty days after such acknowledgment, be filed, one copy in the office of the county clerk of the county wherein such savings bank is proposed to be located, and one copy in the office of the superintendent of the banking department of this State. Constructed from section four, chapter 371, Laws of 1875. intention § 239. A notice of intention to organize such savings * For blank form of certificate of association, see page 275. State of New York. 133 bank shall be published at least once a week for four to orRaa- ■*■ ize to be weeks previous to filing the certificate of association, as published, provided in the last preceding section, in at least one newspaper of the largest circulation published in the city, village or town where such savings bank is proposed to be located ; or, if there be no newspaper published in such village or town, then in some newspaper published in such county ; if none in said county, then in an ad- joining county, which notice shall specify the names of the proposed corporators, the name of the proposed sav- contents, ings bank and the location of the same as set forth in the certificate of association ; and if there is any savings bank or banks organized and doing business in such connty, a copy of such notice shall also be sent to each such savings bank so organized and doing business, at To notify least fifteen days before the filing of such certificate of Ju^oountyf association, as provided for in the last preceding section. Constructed from aeotion five, chapter 371, Laws of 1875. § 240. Upon the receipt of any such certificate of as- f^^fnt'to sociation at the ofiice of the superintendent of the bank- c"rtifloate filed for ing department, if the same is in due form and duly eiamina- executed according to the provisions of sections two hun- dred and thirty-seven and two hundred and thirty-eight of this act, and is accompanied by evidence satisfactory to tne superintendent of the proper publication and ser- vice, in good faith, of the notice required in the last preceding section, he shall forthwith indorse the same over his official signature " filed for examination," with the date of such indorsement. Constructed from section six, chapter 371, Laws of 1875. § 241. If such certificate shall not be in form and sub- Defective o certificate Stance as required by section two hundred and thirty- siei° *" 124 Banking Laws of the seven of this act, or shall not be duly and properly acknowledged, as requu-ed by section two hundred and thirty-eight of this act, or shall not be accompanied by evidence satisfactory to the superintendent of the publi- cation and service in good faith, according to the intent and purpose of this act, of the notice required by section two hundred and thirty-nine of this act, the superin- tendent shall refuse to file such certificate until the same shall be amended in conformity to the provisions of this act Oonstrnoted from section seven, chapter 371, Laws of 1875. Sirperin- § 242. It shall be the duty of the superintendent of teodent to certain'" *^® banking department, and he shall have power in regard to any certificate of association so filed by him, as hereinbefore provided, to ascertain from the best sources of information at his command : 1. Whether greater convenience of access to a savings bank will be afforded to any considerable number of de- positors by opening a savings bank at the place desig- nated in such certificate. 2. Whether the density of the population in the neighborhood designated for such savings bank, and in the surrounding country, affords a reasonable promise of adequate support to the enterprise. 3. Whether the responsibility, character and general fitness for the discharge of the duties appertaining to such a trust of the persons named in such certificate are such as to command the confidence of the community in which such savings bank is proposed to be located. Constructed from section eight, chapter 371, Laws of 1875. When oer- § 243. If the Superintendent shall be satisfied, from tlflcate of authoriza- hjg knowledge or from information gained concerning State of New York. 135 tlie several points named in the last preceding section, tion shaii DO iSSUGu that the organization of a savings bank, as proposed in sach certificate, will be a public benefit, he shall, within sixty days after the same has been filed by him for ex- amination, issue, under his hand and official seal, a cer- tificate of authorization to the persons named in such certificate, or to them, or to a portion of them, together with such other persons as a majority of those named in such certificate of association shall, in writing, approve; which certificate, so issued by him, shall authorize the persons named therein to open an office for the deposit of savings, as designated in the certificate of association, subject to the provisions of this act ; provided, however, that no person shall be named in such certificate of authorization, who shall not have duly made and ackowl- edged the declaration prescribed in subdivision four of section two hundred and thirty-seven of this act. Constructed from section nine, chapter 3V1, Laws of 1875. § 244. The superintendent shall transmit such certifi- Authoriza- tion to be cate of authorization to the county clerk of the county comity in which the savings bank, so authorized, is to be located, duplicate "^ ' 'by super- who shall file the same and attach it to the certificate of *°'8° j c payments, or on deposit in any bank or banking association in the deposits. State of New York, organized under any law or laws of * Deposits with banks under an agreement as to time of withdrawal, not authorized, see opinion of attorney-general, page 39T. Contributions for public benefit, not authorized, see opinion of attorneyr general, page 401. Unlawful to pledge securities for the purpose of borrowing money, see opmion of attorney-general, page 36T. State of New Yokk. 135 this State, or of the United States, or with any trust company incorporated by any law of this State, but the sum so deposited in any one bank or trust company shall not exceed twenty-five per centum of the paid-up capital Limitation ■' ^ r f r of deposits and surplus of such bank or trust company; or such ^o^pS's available fund, or any part thereof, may be loaned upon pledge of the securities, or any of them, named in sub- divisions one, two, three and four of the last preceding u^on^^er. section of this act, but not in excess of ninety per centum curities. of the cash market value of such securities so pledged ; and should any of the securities so held in pledge de- preciate in value, after making any loan thereon, it shall be the duty of the trustees to require the immediate pay-pecauof ^' ■*■ ^ "^ loaas au- ment of such loan, or of a part thereof, or additional in°Ja3e df deprecia- security therefor so that the amount loaned shall at no tio°- time exceed ninety per centum of the market value of the securities pledged for the same. (As amended by chapter 569, Laws of 1886.) Constructed from section twenty-seven, chapter 311, Laws of 1875. § 262. It shall further be lawful for any such corpora- Temporary deposits in tion to deposit temporarily in banks or trust companies, ^^^^' *'". as provided in the last preceding section of this act, the excess of current daily receipts over the payments, until • such time as the same can be judiciously invested in the securities named in section two hundred and sixty of this act ; and whenever it shall appear to the superintendent of the banking department that the trustees of any siieh corporation are violating the spirit and intent of the foregoing provisions, by keeping permanently uninvested all, or an undue proportion of the moneys received by if undue proportion them, it shall be his duty to report the facts to the attor- "g'^ptu^. ney-general, who shall proceed against such corporation 136 Banking Laws of the under the provisions of section two hundred and seventy- eight of this act. Constructed from section twenty-eight, chapter 871, Laws of 1875. May pur- *§ 263. It shall be lawful for any such corporation to chase.hold "^ J . f rea'i'e°tate purchase, hold or convey real estate only as follows : herein^ 1. A plot whereou is erected, or may be erected, a provided. building or buildings requisite for the convenient trans- action of its business, and from portions of which, not required for its own use, a revenue may be derived. The costf of such building or buildings and lot in no case to exceed fifty per centum of the net surplus of such cor- poration, except by written permission of the superin- tendent of the banking department, except where lots have been heretofore purchased, or where maps, plans and estimates have been made for the purpose of erecting a banking building. 2. Such as shall have been purchased by it at sales upon the foreclosure of mortgages owned by such corpo- ration, or upon judgments or decrees obtained or rendered for debts due to it, or in settlements effected to secure such debts; and all such real estate mentioned in the last preceding clause shall be sold by such corporation within five years after the same shall be vested in it, unless, upon application by the board of trustees, the superintendent- of the banking department shall extend:]: the time within which such sale shall be made ; and it shall be lawful for any such corporation, with the approval in writing, and * Purchase of real estate on which to erect buildings to rent, not author- ized, see opinion of attorney-general, page 352. + In determining the surplus of a savings bank proposing to erect a banking-house, tho values fixed by section 268 govern, see opinion of attor- ney-general, page 372. i Powers of superintendent respecting extension of time for sale of real estate, see opinion of attorney-general, page 417. State of New Yoke. 137 under the seal of the superintendent of the banking de- partment, to change its location within* the limits of any Location ^ ' ° "'of bank city or town wherein it may be established ; and in effect- Siauged. ing such change of location, such corporation owning a banking-house and lot may purchase such additional plot under the provisions of subdivision one of this section as the corporation may require ; and such banking-house and lot previously owned and occupied shall be sold, as provided in subdivision two of this section, concerning real estate acquired in satisfaction of debts. Constructed from section twenty-nine, chapter 3T1, Laws of 1875. +S 264. It shall not be lawful for the trustees of any No loans ' " -^ to be made savings bank to loan the moneys deposited with them, or arsecui?ty. any part thereof, upon notes, bills of exchange, drafts, or ^ ^^ any other personal securities whatever ; and in all cases m'ortgage ; expenses of loans upon real estate, a sufficient bond, secured by a ^"^n^j^''/ mortgage thereon, shall be required of the borrower, and ^"^' all the expenses of searches, examinations and certificates of title or appraisal of value, and of drawing, perfecting and recording papers shall be paid by such borrower. Constructed from section thirty, chapter 371, Laws of 1875. § 265. Whenever buildings are included in the valua- Mortgaged " ^ property tion of any real estate upon which a loan shall be made sured!"' by any such corporation, they shall be insured by the mortgagor in such company or companies as the trustees shall direct, and the policy of insurance shall be duly assigned, or the loss made payable as its interest may ap- pear, to such corporation ; and it shall be lawful for such corporation to renew such policy of insurance, in the * Penalty for changing location without approval of superintendent, how enforced, see opinion of attorney-general, page 369. + Acceptance of corporate searches optional with savings bank, see opin- ions of attorney-general, pages 403, 412 and 413. 138 Banking Laws of the same, or in any other company or companies, as they may elect, from year to year, or for a longer or shorter term, in case the mortgagor shall neglect to do so, and If raort- may charge the amount paid to the mortgagor. And all gapor fails i'nTm-e™n'd ^^^ necessary charges and expenses paid by such corpora- a Hen. tion for such renewal or renewals shall be paid by sucli mortgagor to such corporation, and shall be a lien upon the property so mortgaged, recoverable with interest from the time of payment as part of the moneys secured to be paid by such mortgage. Constructed from section thirty-one, chapter 371, Laws of 1875. Eestrio- *§ 266. It shall be unlawful for any savings bank, di- tion on doing"' °' rectly or indirectly, to deal or trade in real estate, in business. r ^ 11 any other case or tor any other purpose than as author- ized in section two hundred and sixty-three of this act, or to deal or trade in any goods, wares, merchandise or commodities whatever, except as authorized by the terms of this act, and except such personal property as may be necessary in the transaction of its business; and it shall be unlawful for any savings bank, or for any officer thereof in his regular attendance upon tlie business of such bank in any manner to buy or sell exchange, or gold or silver, or to collect or to protest promissory notes or time bills of exchange ; but this restriction shall not prevent savings banks from selling gold or silver received in payment of interest or principal or obligations owned by the bank, or from depositors in the regular course of business, nor from paying regular depositors, when requested by them, by draft upon deposits to the credit of the bank in the city of New York, and charging current rates of exchange * Purchase of real estate for the erection of buildings thereon to rent, not authorized, see opinion of attorney-general, page 852. State of New York. 139 for such drafts ; and no savings bank shall make or issue any certificate of deposit, payable either on demand or at a fixed day, nor pay any interest except regular quarterly or semi-annual dividends upon any deposits or balances, nor pay any interest or deposit, or portion of a deposit, or any check drawn upon itself by a depositor unless the pass-book of the depositor be produced, and the proper entry be made therein at the time of the transaction ; provided, however, that the board of trustees may by their by-laws provide for making payments in cases of loss of pass-book, or other exceptional eases where the pass-book cannot be produced without loss or serious in- convenience to depositors, the right to make such pay- ments to cease, however, when so directed by the super- intendent of the banking department, upon his being sat- isfied that such right is being improperly exercised by any savings banks ; and provided further, that payments may be made upon the judgment or order of a court, or the power of attorney of a depositor. Constructed from section one, chapter 347, Laws of 1878. *§ 267. It shall be the duty of the trustees of every Trustees to regulate such corporation to regulate the rate of interest or divi-[^*®3°*g"g dends not to exceed five per centum per annum upon the deposits therewith, in such manner that depositors shall receive, as nearly as may be, all the profits of such cor- poration after deducting necessary expenses and reserving such amount as the trustees may deem expedient as a * Ten day period as to payment of interest not applicable to banks which declare quarterly dividends, see opinion of attorney-general, page 368. The provision relating to payment of interest on deposits withdrawn dur- ing last three days of the month not applicable to banks which declare quarterly dividends, see opinion of attorney-general, page 346. Established surplus not to be used for purpose of increasing dividends, see opinion of attorney-general, page 415. 140 Banking Laws op the surplus fund for the security of depositors, which, to the amount of fifteen per centum of their deposits the trustees of any such corporation are hereby authorized gradually to accumulate and hold, to meet any contingency or loss in its business from the depreciation of its securities, or otherwise; provided, however, that the trustees of any such corporation may classify their depositors according to the character, amount and duration of their deal- ings with the corporation, and regulate the interest or dividends allowed in such manner, that each depositor shall receive the same ratable proportion of interest or Period for dividends as all others of his class. It shall be unlawful wnicii in- to aflowed for the trustees of any savings bank to declare or allow interest on any deposit for a longer period than the same has been deposited, except that deposits made not later than the tenth day of the month, commencing any semi- annual interest period, or than the third day of any month, or withdrawn on one of the last three days of the month ending any quarterly or semi-annual interest period, may have interest declared upon them for the whole of the period or month when so deposited or withdrawn. No dividends or interest shall be declared, credited or paid, except by the authority of a vote of the board of trustees, duly entered upon their minutes, whereon shall be re- corded the ayes and nays upon each vote, and whenever any interest or dividends shall be declared and credited in excess of the interest or profits earned, and appearing to the credit of the corporation, the trustees voting for such dividend shall be jointly and severally liable to the corpo- ration for the amount of such excess so declared and Surplus to credited. And it shall be the duty of the trustees of any ' such corporation, whose surplus amounts to fifteen per State of New York. 141 centum of its deposits, at least once in three years, to divide equitably the accumulation beyond such authorized surplus, as an extra dividend to depositors, in excess of the regular dividends hereinbefore authorized. A notice Notice of posted conspicuously in the bank of a change in the rate ^'e. of interest shall be equivalent to a personal notice. (As amended by chapter 48, Lavs^s of 1884.) Constructed from section one, chapter 256, Laws of 1877. § 268. In determining the per cent of surplus held by Percent of any savings bank, its interest-payinsr stocks and bonds how de- J. ./ o termlned. shall not be estimated above their par value or above their market value if below par; its bonds and mort- gages on which there are no arrears of interest for a longer period than six months shall be estimated at their face, and its real estate at not above cost. Concerning SQch stocks or bonds, or bonds and mortgages as are in arrears of interest for six months or more, and concerning all other investments not herein enumerated, the superin- tendent of the banking department shall determine the valuation of the same from the best information he can obtain, and he may change the valuation thereof from time to time according as he may obtain other and fur- ther information. Constructed from section two, chapter 256, Laws of 1877. *§ 269. It shall be lawful for trustees of such corpora- compen- jy. /. , , satlon of tion, acting as omcers or the same, whose duties require trustees. and receive their regular and faithful attendance at the institution, to receive such compensation as in the opinion of a majority of the board of trustees shall be just and * Majority of trustees when fixing compensation of officers, how consti- tuted, see opinion of attorney-general, page 371. Unearned salaries of deceased otiicers, can not be lawfully paid to per- sonal representatives, see opinion of attorney-general, page 399. 143 Banking Laws of the reasonable ; but such majority shall be exclusive of any trustee to whom such compensation shall be voted ; but it shall not be lawful to pay trustees, as such, for their at- tendance at meetings of the board. Constructed from section thirty-five, chapter 371, Laws of 1875. fupe°rta-*' *§ 2T0. Every such corporation shall, semi-annually on or before the first day of February and August in each year, make a report in writing to the superintendent of the banking department, and in such form as he shall prescribe, of its condition on the morning of the first days of January and July preceding. Constructed from section three, chapter 256, Laws of 1877. of report. § ^''^^- ^uch report shall state the amount loaned upon bond and mortgage, together with a list of such bonds and mortgages and the location of the mortgaged prem- ises, as have not been previously reported, and also a list of such previously reported as have since been paid wholly or in part, or have been foreclosed, and the amount of such payments respectively; the cost, par value and estimated market value of all stock invest- ments, designating each particular kind of stock; the amount loaned upon the pledge of securities with a state- ment of the securities held as collateral for such loans; the amount invested in real estate, giving the cost of the same ; the amount of cash on hand, and on deposit in banks or trust companies, with the names of such banks or trust companies, and the amount deposited in each ; and such other information as the superintendent may require. Constructed from section thirty-seven, chapter 371, Laws of 1875. * Penalty for failure to make required report, how enforced, see opinion of attorney-general, page 369. State of New Yoek. 143 § 272. Such report shall also state all the liabilities of contents o£ report such savings corporation on the morning of the said first ^'o""^"^'^ day of Januai'y ; the amount due to depositors, which shall include any dividend to be credited to them for the six months ending on that day, and any other debts or claims against such corporation which are or may be a charge upon its assets. Such report shall also state the amount deposited during the year previous, and the amount withdrawn during the same period ; the whole amount of interest or profits received or earned and the amount of dividends credited to depositors, together with the amount of each semi-annual credit of interest, and the amount of interest that may have been credited at other than semi-annual periods ; the number of accounts opened or re-opened, the number closed during the year, and the number of open accounts at the end of the year, and such other information as may be required by the superintendent. Constructed from section thirty-eight, chapter 371, Laws of 1875. § 273. Such report shall be verified by the oath of the Report to be veri- two principal officers of the institution, and the state- ^®^- ment of assets shall be verified by the oath of a majority of the trustees who examined the same, pursuant to the requirements of section two hundred and seventy-nine of this act ; and any willful false swearing in regard to such reports, or in regard to any reports made to the superintendent of the banking department pursuant to the provisions of this act shall be deemed perjury, and be subject to the prosecutions and punishment prescribed by law for that offense. Constructed from section thirty-nine, chapter 371, Laws of 1875. L44 Banking Laws oi? the Failure to § 274. If any savings bank shall fail to furnish to the superintendent of the banking department any report or statement required by this act, at the time so required, it shall forfeit the sum of one hundred dollars per day for every day such report or statement shall be so delayed or withheld ; and the said superintendent may maintain Penalty, an action in his name of office to recover such penalty, and when collected, the same shall be paid into the treas- ury' of the State, and be applied to the expenses of the banking department; but the superintendent may, for sufficient cause, extend the time for making such report not exceeding thirty days. Constructed from section forty, chapter 371, Laws of 1875. No other 8 275. No such corporation shall hereafter be required report, por u i ^ than^as""" to make any annual or other report to the legislature nor herein ' , . , provided, to the mayor or commonalty of any city, nor to the board of supervisors of any county, nor to any other officer or authority whatsoever, except as in this act pro- vided and required, any thing in the charter of any such corporation to the contrary notwithstanding ; nor shall they be subject to the inspection or supervision of any local officer, or board, nor to any interference from any such local officer or board, in any matters pertaining to the business or dealings of such corporation. Constructed from section forty-one, chapter 371, Laws of 1875. Superin- 8 276. It shall be the duty of the superintendent of tendentto " ./ r legisfatiire. the banking department, on or before the first day of March in each year, to communicate to the legislature a statement of the condition of every such corporation from which a report has been received for the preceding year ; also the name and location of savings corporations authorized by him during the previous year, with the State of New York. 145 date of their incorporation, and particularly designating those incorporated at any time which have commenced business during the previous year. Constructed from section forty-two, chapter 371, Laws of 1875. § 277. Tt shall be the duty of the said superintendent ^^''^ *"'° once in two years, either personally or by some compe- ^Iqu^rea to be ex- tent person or persons to be appointed by him, to visit am>°ed^ _ and examine every savings corporation in this State. The superintendent shall have power, in like manner, to ex- amine any such corporation, whenever in his judgment, its condition or management is such as to render an ex- amination of its affairs necessary or expedient. The said superintendent and every such examiner shall have power to administer an oath to any person whose testimony may be required on any such examina- tion, and to compel the appearance and attendance of any such person for the purpose of such examination, by summons, subpoena or attachment, in the manner now authorized in respect to the attendance of persons as witnesses in the courts of record of this State ; and all Attend- ance and books and papers which it may be deemed necessary to tion™'"*" 11 .1,1 . witnesses. examine by the superintendent or the exammer or exam- iners so appointed shall be produced, and their produc- tion may be compelled in like manner. The expense of every such special examination, if any, shall be paid by the corporation examined, in such amount as the superin- tendent shall certify to be just and reasonable. When- ever such special examination shall be made by the superintendent in person, or by one or more of the regu- lar clerks in his department, no charge shall be made ex- cept for necessary traveling and other actual expenses. The result of any suxjh examination shall be certified by 19 146 Banking Laws of the Result cer- the examiners, or one of them, upon the records of the tilled on ' ' ^ recordaof corporation examined, and the results of all the regular examinations during the previous years shall be embod- ied in the annual report of the superintendent required by this act to be submitted to the legislature. Constructed from section forty-three, chapter 371, Laws of 1875. If bank *8 278. Whenever it shall appear to the superin- unsafe, or *- ^ ^ ?l|i?t,'or tendent, from any examination made by him, or from abused, the report of any examination made to him, or from the superin- '■ '' to"i?o^t«y report made by any such corporation pursuant to the attorney- . - . i n i j x j^ general, requirements oi section two hundred ana seventy oi this act, that any such corporation has committed any violation of its charter or of law, or is conduct- ing its business and affairs in an unsafe or unau- thorized manner, he shall, by an order under his hand and seal, direct the discontinuance of such illegal and unsafe or unauthorized practices, and strict conformity with the requirements of the law, and with safety and security in its transactions ; and whenever any such corporation shall refuse or neglect to make any such report as is hereinbefore required, or to comply with any such order as aforesaid, or whenever it shall appear to the superintendent that it is unsafe or inexpe- dient for any such corporation to continue to transact business, or that any trustee or officer of a savings bank has abused his trust, or been guilty of misconduct or mal- versation in his official position injurious to the bank, or to its depositors, he shall communicate the facts to the attorney-general, who shall thereupon institute such pro- Proceed- ceedings as the nature of the case may require. The * Power of superintendent to interfere confined to matters now being car- ried on, see opinion of attorney-general, page 345. State of New Yore. 147 proceedings instituted by the attorney -general may be foringsby the removal of one or more of the trustees, or for the ^®''®''^ ■ transfer of the corporate powers to other persons, or the consolidation and merger of the corporation with any other savings corporation that may be willing to accept of the trust, or for such other or further relief or correc- tion as the particular facts communicated to him shall seem to require. And the court before which such pro- ceedings shall be instituted shall have power to grant such orders, and in its discretion from time to time to modify or revoke the same, and to grant such relief and render such judgment as the facts, or evidence in the case, and the situation of the parties, and the interests involved shall seem to require , and whenever in such proceedings an order shall be granted, upon notice or without notice, restraining such corporation and its ofiBcers from paying out or disposing of any moneys or property of, or held by such corporation, the superintendent may, and if directed by the court, shall, take temporary possession of all the assets, property and rights of, or held by siich corporation, and hold such possession until the further order of the in.oases of court. If a receiver be appointed, he shall, subject to the tenlent takes tern- direction of the court, proceed with diligence to convei-t p'"''"'^. ' ^ o possession, the assets of the bank into money and to make distribu- tion thereof. And every receiver of a savings bank shall, whenever required by the court upon the application of the attorney-general, render an account of his proceed- ings, and shall render a full account of all his proceedings and make final distribution within eighteen months from fl^Pi^igtrf. the time of his appointment, unless the court, upon appli- eigiiteen cation by the receiver and notice to the attorney-general, shall give additional time for that purpose. The court 148 Baneiistg Laws of the may make such orders for the payment of small deposits by receivei-s, or such other provisions in respect to such deposits, to facilitate the distribution of the assets, as may be just. Every official report made by the superintend- ent to the attorney-general, and every official report duly verified of any examination made under the provisions of this act, shall be presumptive evidence in all preHmi- nary legal proceedings on motion to appoint a receiver. Constructed from section one, chapter 422, Laws of 1879. ^°e TO*iISh- § ^'^^■' -'-* ^^^^^ ^^ ^^^ ^^^y °^ *^^® trustees of every assents, and Savings bank, by a committee of not less than three of report to be verified, guch trustees, on or before the first day of January and July in each year, to thoroughly examine the books, vouchers and assets of such savings bank and its affairs generally ; and the statement or schedule of assets and liabilities reported to the superintendent of the banking department for the first of January and July in each year, shall be based upon such examination, and shall be veri- fied by the oath of a majority of the trustees making such examination, but nothing herein contained shall be con- strued as prohibiting the trustees of any savings bank from requiring such examinations at such other times as they shall prescribe. It shall be the duty of the trustees of any such corporation, as often as once in each six months during each year, to cause to be taken an accu- Deposit- rate balance of their depositors' ledgers, and in their ors''Iedger ^ ° ' anced''aiid semi-annual report to the superintendent of the banking made department, they shall state the fact that such balance semi- ^ J d annually, j^^^g been taken, and shall state the discrepancies, if any, existing between the amount due depositors, as shown by such balances, and the amount due to depositors as shown by the general ledger. Constructed from section four, chapter 256, Laws of 1877. State of New York. 149 § 280. The superintendent of the banking department Superin- is hereby authorized from time to time to employ so I^Eitanta. many clerks and examiners as may be necessary to dis- charge, in a proper manner, the duties imposed upon him by the provisions of this act in relation to savings banks ; and the salary of the said clerks and examiners shall be paid to them monthly out of the treasury of the State upon the certificate of the superintendent and the warrant of the comptroller, and it shall be the duty of the said superintendent, in his annual report to the legis- lature, to state the names of the clerks and examiners so employed, and the compensation allowed to them sever- ally. Constructed from section forty-six, chapter 371, Laws of 1875 § 281. For the purpose of defraying the expenses in- Expenses, curred in the performance by the superintendent of the general duties, including the regular examinations, im- posed upon him by the provisions of this act in relation to savings banks, each savings corporation shall pay five dollars, and the residue of such expenses shall be paid by savings corporations whose deposits exceed one hundred thousand dollars, in proportion to the amount of assets severally held and reported by them, and the sums so contributed shall be paid into the treasury of the State. If any such savings corporation shall, after due notice, refuse or neglect for thirty days to pay its allotted share of such charges, the said superintendent may maintain an action in his name of ofiice against such corporation for the recovery of such charges. Constructed from section forty-seven, chapter 371, Laws of 1875. § 282. All the assets of any bank or banking associa- ^^ tion now or hereafter organized that shall become in-bauks^ 150 Bastkikg Laws of the from in- solvent shall, after providing for the payment of its cir- fmed.^™" culating notes, if it shall have any, be applied by the directors, assignee, or receiver thereof, in the first place to the payment in full of any sum or sums of money de- i posited therewith by any savings corporation, but not to an amount exceeding that authorized to be so deposited by the provisions of section two hundred and sixty-one of this act ; and the foregoing provisions of this section shall also extend and apply to trust companies receiving deposits of savings corporations as authorized by this act, subject, however, to any preference in payment declared and provided in the charters of such trust companies re- spectively. Constructed from section forty-eight, chapter 371, Laws of 1875. *§ 283. It shall not be lawful for any bank, banking To adver- tise as banis with- association or individual banker, firm, association, corpo- out au- ) ) ) r fawfuf """' ration, person or persons, to advertise or put forth a sign as a savings bank, or in any way to solicit or receive de- posits as a savings bank ; and any bank, banking associa- tion or individual banker, firm, association, corporation, person or persons, which shall ofEend against these pro- visions, shall forfeit and pay for every such ofi'ense the sum of one hundred dollars for every day such offense shall be continued, to be sued for and recovered in the name of the people of this State, by the district attorneys of the several counties, in any court having cognizance thereof, for the use of the poor, chargeable to said county in which such offense shall be committed. Constructed from section forty-nine, chapter 371, Laws of 1875, as amended by section one, chapter 373, Laws of 1881. * This prohibition does not interfere with the common-law right of a per- son or persons, to take money for the purpose of keeping it safely for an individual, see opinion of attorney-general, page 419. State of New Yoke. 151 *S 284. It shall be lawful for the board of trustees of Number of ^ trustees any savings corporation, by a resolution to be incorpo- reduced or increased . rated in their by-laws, a copy of which shall also be filed with the superintendent of the banking department, to reduce the number of trustees named in the original charter of such corporation to a number not less than the minimum named in this act, such reduction to be ef- fected gradually by the occurrence of vacancies by death, resignation or forfeiture, until the number is re- duced to thirteen or to such greater number as shall be designated in the aforesaid resolution ; or the number of trustees may be increased to any number designated in a resolution for that purpose, where reasons therefor are shown to the satisfaction of the superintendent, and his consent in writing obtained thereto. Constructed from section fifty, chapter 371, Laws of 1875. § 285. Whenever a raaiority of the trustees of any such Name of ° •> ■' •' bank may corporation shall, by a resolution to be entered upon their changed, minutes, express a desire and purpose to change the name of such corporation, the same may be effected in the manner following, namely : Notice of intention to apply to the superintendent of the banking department for leave to change the name of such corporation, specifying the name thereof, and the • name to which it is proposed to change the same shall be published as required in section two hundred and thirty- nine of this act. After such publication, application may Prooeed- be made to the superintendent to change the name of poae^"''' such corporation to such name as has been agreed upon * Banks organized prior to 1875, may increase the number of their trustees to a number less than thirteen, upon obtaining consent of the superin- tendent, see opinion of attorney-general, page 353. , 152 Banking Laws of the in such resolution, and published in such notice, evidence of which resolution and publication must be made satis- factory to the superintendent, together with such appli- cation. If it shall appear to the superintendent that it is expedient and proper that such change of name be made, he shall, by an order under his hand and seal of ofSce, direct and authorize such change of corporate name to be made, and designate some day in the future, not to exceeed thirty days from the date of such order, when the said change shall take effect. Such order shall be executed in triplicate ; one copy shall be transmitted and filed in the office of the county clerk of the county in which such corporation is located; one copy shall be transmitted to the corporation affected thereby ; and one copy shall be filed in the office of the superintendent of the banking department. Thereupon from the date designated in such order for such change of name to take effect, such corporation shall be known and described by the name designated in such order, and by such name shall have all the rights and powers to which it would be entitled if such change had not been made ; but no such change shall in any manner lessen or impair any Kability of such corporation incurred or existing at the time such change of name shall be made. Constructed from section fifty-one, chapter 871, Laws of 1875. Charters of § 286. The powers, privileges, duties, and restrictions aU savings n i ■ banks conferred and imposed upon any savings corporation, by amendea ^ j. ./ o jr j j form'to whatever name known, by its charter or act of incor- thls act. 1.1 poration, are hereby abridged, enlarged or modified, as each particular case may require, in such manner that each and every such charter or act of incorporation shall be made to conform to the provisions of this act in rela- State of New Yoek. 153 tion thereto, and to such amendments as may be made thereto; and each and every such savings corpora- tion shall possess the powers, rights and privileges, and be subject to the duties and restrictions and habilities conferred and imposed by this act, any thing in their respective charters or acts of incorporation to the con- trary notwithstanding. But nothing in this act shall be liegaiity of construed to affect the legality of investments heretofore before • 1 c 1 1 this act made, or of transactions heretofore had, pursuant to any not to be provisions of law in force when such investments were made, or transactions had, nor to require the change of investments for those named in this act, except as the same can be done gradually by the sale or redemption of the securities so invested in, in such manner as to pre- vent loss or embarrassment in the business of such cor- poration, or unnecessary loss or injury to the borrowers on such securities. And the investment* hereafter in Misde- meanor to any such securities not named in this act, or the amend- t°ar^to°°' ments that may be made thereto, shall be deemed a mis- demeanor, on the part of the trustees authorizing, or offi- cers making the same ; and such trustees or officers shall be subject to the prosecutions and punishments pre- scribed by law for that offense. Constructed from section fifty-two, chapter 371, Laws of 1875. § 287. All certificates or other evidences of deposit. Evidences ° ^ ^ ' of deposit. made in pursuance of the regulations and usages of any such corporation, shall be as binding upon such corpora- tion as though made under its common seal. Constructed from section fifty-three, chapter 371, Laws of 1875. § 288. The misnomer of any such corporation in any Misnomer * Authorized investments defined by sections 260, 261 and 263, ante, see opinion of attorney-general, page 420. 154 Banking Laws or the Impair any deed, ffrant, contract, conveyance or other instrument ™®°*' shall not vitiate or impair the same, if the corporation be sufficiently described therein to ascertain the intention of the parties. Constructed from section fifty-four, chapter 371, Laws of 1875. Act; how 8 289. This act, so far as it relates to savings banks, is to be con- u ; o > strued. hereby declared to be a public act, and shall be construed favorably for every beneiicial purpose therein contained. Constructed from section fifty-fire, chapter 371, Laws of 1875. Savings . § 290. It shall be unlawful for any savings bank, di- deposftin rcctly Or indirectly, to receive from any individual a excess of. ,.. $3,ooofrom deposit or deposits m excess of three thousand dollars; any one ^ ^ ' exceptTn but this limitation shall not apply to deposits arising case of judicial from iudicial sales or trust funds ;* nor shall it be eou- sales ana ^ ' credits.' strued as prohibiting the crediting of interest on indi- vidual accounts which may have reached the maximum limit, provided that thereafter no interest shall be al- lowed on such increase. (As amended by chapter 477, Laws of 1885.) Constructed from section two, chapter 347, Laws of 1878. Trustee g 291. No porson shall be elected trustee of any sav- resi ent. .^^^ bank who is not a resident of this State ; and re- moval from the State by any trustee hereafter elected shall vacate his office. Constructed from section three, chapter 347, Laws of 1878. Receiver +8 292. It shall be the dnty of the receiver of any sav- to file " ■' •' unde™oath ings bank or institution to keep an account of all moneys quarterly. , received by him ; and on the first day of January, April, July and October of each year to make and file a written * Term " trust funds ' ' defined, see opinion of attorney-general, page 370. t Receivers required to make semi-annual reports to the superintendent of the banking department, see chapter 878, Laws of 1883, page 249. State of New York. 155 statement in the office of the county clerk of the county in which such savings bank is located, verified by his oath of its correctness and truth, showing the amount of money received by him, his agents and attorneys ; the of°8lme^ amount he has by law a right to retain, the items for which he has retained it, and the distributive share due each person interested therein ; and for a failure to com- ply with such requirement, it shall be sufficient cause for his removal. Constructed from section two, chapter 422, Laws of 1879. § 293. Whenever the trustees of any solvent savings Savings bank shall deem it necessary or expedient to close the tarily" closed . business of such corporation, they may, by the affirma- tive vote of not less than two-thirds of the whole number of trustees at a meeting to be called for that purpose, of which all the trustees shall have notice, declare by a reso- lution their determination to close such business, to pay the moneys due depositors and creditors, and to surren- der the corporate franchise.* The vote upon such resolu- tion shall be taken by ayes and noes, and the resolution and the vote thereon shall be recorded in the minutes of said board of trustees. A copy of the record of such proceedings, certified by the president and secretary of such corporation, shall be filed in the banking depart- ment. The trustees shall thereupon give notice to all the depositors and creditors of the adoption of such reso- lution, by publication thereof in a newspaper or news- papers most likely to give the same proper publicity, and by printed or written notice, personally served upon or * Order of court necessary for dissolution of savings banks, see opinion of attorney-general, page 408. 156 Bakking Laws of the mailed to every depositor and creditor of such savings bank, at their last known residence, postage prepaid. Constructed from section one, chapter 424, Laws of 1879. After § 294. When the trustees of any such savings bank known de- aud credi- ^^^^^ have paid the sums due respectively to all the de- statement positors and creditors whom they can discover, and who to be filed oia?m°d claim their deposits, or the moneys due them, it shall be deposited the duty of such trustees to make a transcript or state- in banl^ depart- ment from the books of the said savings bank of the names of all the depositors and creditors who do not claim or have not received the balances to their credit or due them, and of the sums due them respectively, and to file such transcript in the banking department, and to pay over and transfer all such unclaimed and unpaid deposits, credits and moneys to the superintendent of the banking department. The trustees shall thereupon report their proceedings duly verified to the supreme court, and upon such report and the petition of the trustees, and upon notice to the attorney-general and the superintendent of the banking department, and such other notice as the On notice court may deem necessary, the court shall adjudge the the su- preme franchise surrendered and the existence of the corporation dissolve. . • i. J terminated. Constructed from section two, chapter 424, Laws of 1879. Receiver *§ ^^^" Whenever the receiver of any insolvent savings pai'd"fuii bank shall have paid the full per centum of the amount percent- assets to ^^^ ^^ depositors and creditors which the avails of the flirt stifttft^ mentof assets enable him to pay to the depositors and creditors unclaimed and°pay to ^^ '^^^ discover, and who claim their proportion or share , tendeat'. of such assets, he must, before he can be discharged from ♦Receivers of failed banks are required to make semi-annual reports to the superintendent, see opmion of attorney-general, page 442. State of JSew Yokk. 157 his trust, make a transcript or statement from the books of said bank of the names of all the depositors and credit- ors who have not claimed or received the balances to their credit or due them, and of the sums due them respectively, and file such transcript in the banking de- partment, and also pay over and transfer all such un- claimed deposits and moneys to the superintendent of the banking department. And all receivers of savings banks who have been discharged from their trusts, and who hold any such balances, shall forthwith make and file with said superintendent such transcript or statement, and transfer and pay over to him such balances. Constructed from section three, chapter 424, Laws of 1879. § 296. The superintendent of the banking department officers, shall require the officers and receivers who make the J«<3^"Jj'^^ transcripts or statements herein provided for, and it shall of trans- cripts, etc. be their duty to verify the completeness and accuracy of the same in a satisfactory manner. The superin- Superin- tendent to tendent shall receive the said moneys, and shall give mon^y,eto. a receipt therefor, and shall forthwith deposit the money in some solvent savings bank or savings banks in this State to the credit of the superintendent of the bank- ing department, in his name of office, in trust for the depositors and creditors of the closed savings bank for which they were received. And the said superintendent shall report to the legislature, annually, in his report relative to savings banks, the names of such closed savings Names, etc., to be banks, and the sums of unclaimed and unpaid deposits to reported, the credit of each of them respectively. The superin- Payments, tendent may pay over to the persons respectively entitled* * Proof of ownership of accounts of deceased depositors, see opinion of attorney-general, page 414. 158 Interest may be applied towards ezpeoses. Batstking Laws of the thereto the money so held by him, upon being furnished with satisfactory evidence of their right to the same ; and in case of doubt or of conflicting claimants, he may re- quire an order of the supreme court authorizing and directing the payment thereof. The superintendent may apply the interest earned by the moneys so held by him, towards defraying the expenses incurred in the payment and distribution of such unclaimed dividends to the de- positors or creditors entitled to receive the same. And the said superintendent shall include in his report on savings banks, annually transmitted to the legislature, a statement of the amount of interest earned by such un- claimed dividends. (As amended by chapter 439, Laws of 1883, and chapter 504, Laws of 1884.) Constructed from section four, chapter 424, Laws of 1879. CHAPTER XL Peohtbitions against Unauthorized Banking. Section 297. Association for certain banking purposes prohibited. 298. Penalty. 299. Prohibition of unauthorized corporations, 300. Penalty. 301. Notes, etc., on forbidden loans void. 302. Persons unauthorized, not to engage in certain banking oper- ations. 303. Penalty. 304. Restrictions as to foreign corporations. 305. As to banks and officers of banks of this State. 306. Bank-bills under one dollar not to be circulated. 307. Penalty, in what time and how to be sued for. 308. Bank-bills payable otherwise than in money. 309. Penalty, in what time and how to be sued for. 310. Certain bills declared to be promissory notes. 311. Penalties, how to be sued for and applied. § 297. No person unauthorized by law shall subscribe banking to or become a member of, or be in any way interested Associa- tions for State of Kew York. 159 in, any association, institution or company formed, or to purposes be formed, for the purpose of issuing notes or other evi- "®'^' dences of debt, to be loaned or put in circulation as money ; nor shall any person unauthorized by law sub- scribe to or become in any way interested in any bank or fund created, or to be created, for the like purposes, or either of them. Constructed from section one, title 20, chapter 20, part 1, Revised Stat- utes, as modified by section one, chapter 20, Laws of 1837. § 298. "Whoever shall subscribe to or become a mem- penalty, ber in any such company, or interested in any such bank or fund, shall forfeit one thousand dollars. Constructed from section two, title 20, chapter 20, part 1, Revised Stat- utes. § 299. No incorporated company, without being au- Prohibi- thorized by law, shall employ any part of its effects, or cOTpor^^*' be in any way interested in any fund that shall be em- ployed for the purpose of receiving deposits, making dis- counts or issuing notes or other evidences of debt to be loaned or put into circulation as money. Constructed from section three, title 20, chapter 20, part 1, Revised Statutes. § 300. Any director, or other agent or officer, of any Penalty, incorporated company, who shall violate any provision of the last section, shall forfeit one thousand dollars. Constructed from section four, title 20, chapter 20, part 1, Revised Stat- utes. S 301. All notes and other securities for the payment Notes,eto., ° ^ ■' onforbid- of any money or the delivery of any property, made or Toi°d!°*°'' given to any such association, institution or company, that shall be formed for the purpose expressed in the first section of this chapter, or made or given to secure the payment of any money loaned or discounted by any in- 160 Banking Laws of the eorporated company or its ofiBcers, contrary to the pro- visions of the third section of this chapter, shall be void. Constructed from section five, title 20, chapter 20, part 1, Revised Stat- utes. Persons § 302. No person, association of persons, or body cor- tcfengage porate, except such bodies corporate as are expressly au- banking thorized by law, shall keep any office for the purpose of op6r&- ''°°^' issuing any evidences of debt, to be loaned or put in cir- culation as money ; nor shall they issue any bills or promissory notes, or other evidences of debt as private bankers, for the purpose of loaning them or putting them in circulation as money, unless thereto specially author- ized by law. Constructed from section six, title 20, chapter 20, part 1, Revised Stat- utes, as modified by section one, chapter 20, Laws of 1837. Penalty. § 303. Every person and every corporation, and every member of a corporation, who shall contravene either of the provisions in the last section, or, directly or indi- rectly, assent to such violation, shall forfeit one thousand dollars. Constructed from section seven, title 20, chapter 20, part 1, Revised Stat- utes. Eestric- § 304. This chapter shall not be so construed as to tions as to corpOTa- authorize or permit any corporation, created by the laws of any other State or country, to keep any office for the purpose of receiving deposits or discounting notes or bills, or issuing any evidence of debt to be loaned or put in circulation as money, within this State. Constructed from section two, chapter 20, Laws of 1837. As to § 305. No incorporated bank in this State, nor any banks and ,v. n . , » . officers of officer or director thereof, shall open or keep an office of this state, (jepogi^ qj. discount under this chapter, or be interested or State op New York. 101 concerned, directly or indirectly, in any such association ; the bank officer or director shall forfeit the sum of one thousand dollars for each violation of any of the pro- visions of this section. Constructed from section three, chapter 20, Laws of 1837. .§ 306. No person shall pay, give, or receive in payment, Bankbais under one or in any way circulate, or attempt to circulate, any ^°'^|''g?°' bank-bill, or promissory note, check, draft, or other evi- "" * ® " dence of debt, issued by any banking company within this State or elsewhere, which shall purport to be for the payment of a less sum of money than one dollar. Constructed from section elereu, title 20, chapter 20, part 1, Eevised Statutes. § 307. Whoever shall offend against any provision of Penalty, m what time the last section shall forfeit the nominal amount of the ?°4 '">«', to be sued bill, promissory note, check, draft, or other evidence of °'^' debt so given, paid, received, circulated, or attempted to be circulated, to any person who will sue for the same, in the name of the overseers of the poor of the town where the offense is committed, with their consent, and under their direction, in an action to be commenced within thirty days after the commission of the offense. Constructed from section twelve, title 20, chapter 20, part 1, Revised Stat- utes. § 308. No person shall give, pay, or receive in payment. Bank buis payable or in any way circulate, or attempt to circulate, any otherwise bank-bill, or any promissory note, bill, check, draft, or other evidence of debt, issued by any banking company, whatever, which shall be made payable otherwise than in lawful money of the United States. Constructed from section fourteen, title 20, chapter 20, part 1, Revised Statutes. 21 than in money. 162 Banking Laws of the Penalty, in § 309. Everj person offending against any provision of to be'aued the last scction shall forfeit the nominal amount or value for, of such bill, note or other evidence of debt so given, paid, received, circulated or offered, to any person who will sue for the same in the name of the overseers of the poor of the town where the offense shall be commit- ted, with their consent and under their direction, in an action to be commenced within sixty days after the com- mission of the offense. Constructed from section fifteen, title 20, chapter 20, part 1, Beviaed Statutes. Certain 8 310. All bills, notes or other instruments which bills de- ° ' bi^romls- shall be issued by any banking company, purporting to soiy notes. be receivable in payment of debts due to such company, shall be deemed and taken to be promissory notes for the payment on demand of the sum or value expressed in such instrument ; and such sum shall be recoverable by the holder or bearer of such instrument, in like man- ner as if the same were a promissory note. Constructed from section sixteen, title 20, chapter 20, part 1, Revised Statutes. Persons *8 prohibited from using § 311. No person or persons engaged in the business office sign^ of banking in this State, not subject to the supervision of etc., in- , 1 . n dicating the Superintendent ol the banking department, and not flce''of°a' required to report to him by the provisions of this act, bank. shall make use of any office sign at the place where such business is transacted, having thereon any artificial or corporate name, or other words indicating that such place or office is the place or office of a bank ; nor shall such person or persons make use of or circulate any letter- heads, bill-heads, blank notes, blank receipts, certificates, * District attorneys to institute proceedings for violations of this section, see opinion of attorney-general, page 448. State of New York. 163 circulars or any written or printed or partly written and partly piinted paper whatever, having thereon any arti- ficial or corporate name, or other word or words, indicat- ing that such business is the business of a bank. Who- penalty, ever shall offend against any of the foregoing provisions of this section shall be deemed guilty of a misdemeanor^ and shall also forfeit the sum of one thousand dollars. The penalties prescribed in this chapter, where no other provision is made, shall be recovered by suits in the name of the people of this State, to be prosecuted by the district attorneys of the counties, respectively, where the ofEenses may be committed ; provided, however, that the provisions of this section shall not apply to any per- son or persons engaged in the business of banking in this State prior to the passage of this act. (As amended by chapter 329, Laws of 1885.) GoDstructed from section seventeen, title 20, chapter 20, part 1, Revised Statutes. CHAPTEE XII. Taxation. Suction 312. Stockholders taxable on shares. Deductions. 813. List of stockholders ; inspection thereof by assessors. 314. Tax collectible where bank situated. , 315. Dividends may be retained to pay tax. 816. Saving clause as to taxes under law of one thousand eight hundred and eighty. 317. Assessments of year one thousand eight hundred and eighty confirmed. 818. Shares in State banks taxable only at same rate as shares in national banks. Oath on application for deduction. 319. Intent of preceding section. 820. Tax on individual bankers. 321. Tax on certain corporations of other States and countries. 322. To make annual return to comptroller. Penalty. 323. Accounts subject to inspection of comptroller. 164 Bas-king Laws of the Section 324. Trust companies, how taxable. 325. Diridend, how made on exempt stock. 326. Exemption from taxation, for whose benefit. 32T. Taxes to be paid into treasury for general fund. Stock- § 312. The stockholders in every bank or banking as- eto°''to be sociation organized under the authority of this State, or the value of the United States, shall be assessed and taxed on the of their ' whe?lthe value of their shares of stock therein ; said shares shall located, be included in the valuation of the personal property of such stockholders in the assessment of taxes at the place, city, town or ward where such bank or banking associa- tion is located, and not elsewhere, whether the said stock- holders reside in said place, city, town or ward or not ; but in the assessment of said shares, each stockholder shall be allowed all the deductions and exceptions allowed by law in assessing the value of other taxable personal property owned by individual citizens of this State, and the assessment and taxation shall not be at a greater rate than is made or assessed upon other moneyed capital in the hands of individual citizens of this State. In mak- Deduc- aiiowed.''* i^g ^uch assessment there shall also be deducted from the value of such shares such sum as in the same propor- tion to such value as is the assessed value of the real estate of the bank or banking association, and in which any portion of their capital is invested, in which said shares are held, to the whole amount of the capital stock jjgj^i of said bank or banking association. Nothing herein bank not Contained shall be held or construed to exempt the real exempted hereby, estate of banks or banking associations from either State, county or municipal taxes, but the same shall be subject to State, county, municipal and other taxation to the same extent and rate, and in the same manner acccording to its value as other real estate is taxed. The local au- State of New Yokk. 165 thorities charged by law with the assessment of the said Notice of ° "' asaess- shares shall, within ten days after they have completed Sven*"''® bank, but such assessment, give written notice to each bank or not atook- banking association of such assessment of the shares of its respective shareholders, and no personal or other no- tice to such shareholders of such assessment shall be nec- essary for the purpose of this act. Constructed from section three, chapter 596, Laws of 1880, as amended by section four, chapter 47V, Lawa of 1881. § 313. There shall be kept at all times in the office L«t of where the business of each bank or banking association be kept aubject to organized under the authority of this State, or of the JJ^^p^^J^]^ United States, shall be transacted, a full and correct list of the names and residences of all the stockholders therein and of the number of shares held by each ; and such list shall be subject to the inspection of the officers authorized to assess taxes during the business hours of each day in which busiaess may be legally transacted. Constructed from section four, chapter 596, Lawa of 1880, as amended by section five, chapter 47V, Lawa of 1881. 8 314. When the owner of stock in any bank or bank- Tax to be " '' ooUeoted ing association organized under the laws of this State, or bilf^ia of the United States, shall not reside at the same place where the bank or banking association is located, the col- lector and county treasurer shall, respectively, have the same powers as to collecting the tax to be assessed by this act as they have by law when the person assessed has removed from the town, ward or county in which the as- sessment was made, and the county treasurer, receiver of taxes or other officer authorized to receive such tax from Action the collector may, all or either of them, have an action to brought ■' to collect collect the tax from the avails of the sale of his, her or ^*°"'" 166 Banking Laws of the their shares of stock, and the tax on the share or shares of said stock shall be and remain a lien thereon from the day when the property is by law assessed, till the pay- Tax a Hen ment of said tax, and if transferred after such day, the ou stock. transfer shall be subject to such lien. Constructed from section five, chapter 596, Laws of 1880, as amended by section six, chapter 477, Laws of 1881. oFd^Siend § ^^^- ^^^ *^® purpose of collecting the taxes to be retafoed assessed under the last three preceding sections of this by bank as required ^^*' ^^^ ^ addition to any other law of this State, not in suohtai. conflict with the constitution of the United States rela- tive to the imposition of assessment and collection of taxes, it shall be the duty of every such bank or banking association and the managing officer or officers thereof to retain so much of any dividend or dividends belonging to such stockholder as shall be necessary to pay any taxes assessed in pursuance of the last three preceding sections of this act, until it shall be made to appear to such officer or officers that such taxes have been paid. Constructed from section six, chapter 596, Laws of 1880, as amended by section seven, chapter 477, Laws of 1881. Tases heretO' § 316. All obligations, liabilities and taxes heretofore foreim- incurred or imposed under chapter five hundred and posed ^ ^ chanter ninety-six of the laws of eighteen hundred and eighty 696, laws 1880, saved, are saved and shall be enforced as if this act had not been enacted. Constructed from section eight, chapter 477, Laws of 1881. All taxes § ^^^- -^^^ assessments for taxes levied and imposed holder im- upou the shareholders in State or national banks during posed "^ ° i8"o!°on- tli6 year eighteen hundred and eighty, as the same ap- flrmed. n c i i . • pear on the assessment-rolls of the several cities, towns, wards or villages in this State, or upon the other books State of New York, 167 and records thereof, so far as such assessments are not in conflict with the constitution of the United States, are hereby confirmed, assessed and levied upon such share- holders, whose names now appear on such assessment- rolls or other books and records thereof as assessed upon their bank shares, and may be collected from the share- holders cf said banks in the manner authorized by law for the collection of other personal taxes, in addition to all the remedies by law prescribed for the collection of taxes assessed against shareholders in such bank. Constructed from section ten, chapter ITT, Laws of 1881. § 318. The shareholders of any bank, bankinsf associa- share- " J > & holders of tion, or corporation doing a banking business under the ^*^*^g ^^ general banking law or a special charter of this State only to ° o i same ex- shall be assessed and taxed with respect to their shares of those of stock, only at the same rate and place, to the same ex- banks, tent, and in the same manner, as shareholders of national banks may be hable at the same time to be assessed and taxed by authority of the State of New York ; provided however, that no debts shall be deducted from any such No debt to ■'be twice assessment of any person applying for the benefit of this ^^'i"'=*«.iiini i whom to tition and ot said order shall be served upon the presi- dent or other head of such corporation, or on the cashier, secretary or treasurer thereof, personally, at least ten days before the time designated in said order for show- ing cause. Court to § 2. At the time and place specified in said order, and prooee'l to" quir'F ^"^ proof of due service thereof, the said court shall pro- into facts. i . i ■ i i •, ceed in a summary manner, and m such mode as it may deem advisable to inquire into the truth of the facts stated in said petition, and shall hear such proofs and al- legations as may be offered by or in behalf of the peti- make" *° tioner, or by or in behalf of said corporation or other dupjioate party, relative to the subject-matter of said inquiry, and be issued, jf^ upon such inquiry, said court shall be satisfied that such petitioner is the lawful owner of the number of shares of the capital stock, or any part thereof, described in said petition, and that the certificate therefor has been lost or destroyed, and cannot after due diligence be found, and that no sufficient cause has been shown why a new certificate should not be issued in place thereof, it shall make an order requiring said corporation or other party, State of New York. 198 within such time as shall be therein designated, to issue and deliver to such petitioner a new certificate for the number of shares of the capital stock of said corporation which shaU be specified in said order as owned by said petitioner, and the certificate for which shall have been lost or destroyed. In making such order the court shall direct that said petitioner deposit such security, or file such a bond in such form and with such sureties as to the court shall appear sufiicient to indemnify any person Petitioner other than the petitioner who shall thereafter appear to ^^''""ty- be the lawful owner of such certificate stated to be lost or stolen ; and the court may also direct the publication of such notice, either preceding or succeeding the making of such final order, as it shall deem proper. Any person or Persons claJmiD^ persons who shall thereafter claim any rights under said under lost ^ ./ D security to certificate so alleged to have been lost or destroyed, shall course^to . , . , . T 1 . , . indemnity. have recourse to said indemnity, and the said corporation shall be discharged of and from all liability to such person or persons by reason of compliance with the order afore- said ; and obedience to said order may be enforced by obedience to order said court by attachments against the ofiicer or officers of ^owen- •^ ^ forced. such corporation, on ])roof of his or their refusal to comply with the same. , § 3. This act shall take efEect immediately. CHAP. 289. AN ACT TO AUTHOEIZE JOINT-STOCK COMPANIES AND ASSOCIATIONS TO PURCHASE, HOLD AND CONVEY REAL ESTATE. Passed April 9, 1867. The People of the State of New York, represented in Seriate and Assembly, do enact as follows : Section 1. It shall be lawful for any joint-stock com- 25 194 Banking Laws of the pany or association to purchase, hold and convey real es- tate for the following purposes : 1. Such as shall be necessary for its immediate accom modation in the convenient transaction of its business ; or, 2. Such as shall be mortgaged to it in good faith, bj way of security for loans made by or moneys due to such joint-stock company or association ; or, 3. Such as it shall purchase at sales under judgments, decrees or mortgages held by such joint-stock company or association. The said joint-stock company or association shall not purchase, hold or convey real estate in any other case or for any other purpose ; and all conveyances of such real estate shall be made to the president of such joint-stock company or association, as such president, and who, and his successors, from time to time, may sell, assign and convey the same, free from any claim thereon against any of the shareholders, or any person claiming under them, or any or either of them. § 2. This act shall take effect immediately. CHAP. 146. AN ACT TO AUTHORIZE CORPORATIONS TO HOLD AND CONVEY REAL ESTATE, FOR BUSINESS PUR- POSES, IN OTHER STATES, WITH THE CONSENT THEREOF. Passed March 28, 1872. The People of the State of New York, represented in Senate and Assembly, do enact as follows : tioM°m1[y Section 1. It shall be lawful for any corporation and hold organized under the laws of this state, and transacting real estate ^ ' " states.^"^ business in it and other states, or foreign countries. State op New York. 195 except savings banks, to acquire, hold and convey in such states or foreign countries, with the consent thereof, such real estate as shall be requisite for such corporation, in the convenient transaction of its business, and to invest its funds in the stocks, bonds or securities of other corporations owning lands situated in this state or such states, provided that loans shall not be made on any stocks upon which dividends shall not have been de- clared continuously for three years, immediately before such loans are made; and provided further that such stocks shall be continuously of a market value twenty per cent greater than the amount loaned or continued thereon. § 2. All acts and parts of acts inconsistent with the provisions of this act are hereby repealed. § 3. This act shall take effect immediately. (As amended by chapter 361, Laws of 1883.) CHAP. 290. AN ACT IN" EELATION TO SALES AND PTTBCHASES OP LANDS BY COKPOKATIONS. Passed June 5, 1882. The People of the State of New York, represented in Senate and Assenibly, do enact as follows : Sectios- 1. Any corporation which shall have sold and wmohmay conveyed any part of its real estate, may, notwithstanding and held any restriction in its charter, purchase, take and hold, ■■*"°''S' from time to time, any lands adjacent to those already held by it ; provided the supreme court shall authorize such purchase, taking and holding upon the application 196 Baitkikg Laws of the of such corporation, and on being satisfied that the value of all lands proposed to be so purchased shall not exceed that of lands sold and conveyed by the said corporation within the three years next preceding such application. § 2. This act shall take eflEect immediately. CHAP. 290. AN ACT IM" RELATION TO JOINT-STOCK COMPANIES AND ASSOCIATIONS. Passed April 22, 1868. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. "Whenever the amount of capital stock issued by any joint-stock company or association shall be, at' the par value thereof, in excess of the actual amount of capital called in by such company or association for the transaction of its business, it shall be lawful for the trustees, directors or managing board of such joint-stock company or association, upon the consent in writing of three-fourths of the trustees, directors or managing board thereof, to reduce the capital stock thereof to such an amount as may be determined upon by such trustees, directors or managing board ; provided, that the amount of such capital stock shall not be reduced, at the par value thereof, below the amount of capital stock which shall be called in by such joint-stock company or associa- tion; and provided further, that no such reduction of capital stock shall be made when the unexpended capital in the treasury of such joint-stock company or association shall not be equal to the outstanding liabilities thereof; State of New Yoke. 197 it being the intention hereby to authorize any such com- pany or association to reduce its capital stock to an amount not less, at its par value, than the capital called in by such company or association for the transaction of its business. § 2. This act shall take efiEect immediately. CHAP. 258. AN ACT IN" BELATIOlf TO SUITS BY AND AGAINST JOINT-STOCK COMPANIES AND ASSOCIATIONS. Passed April 7, 1849. The People of the State of New York, represented in Senate and Assembly, do enact as foUows : Section 1. Any joint-stock company or association, Suits how consisting of seven or more shareholders, or associates, and"prose- cuted. may sue and be sued, in the name of the president or treasurer, for the time being, of such joint-stock company or association ; and all suits and proceedings so prose- cuted, by or against such joint-stock company or associa- tion, and the service of all process or papers in such suits and proceedings on the president or treasurer for the time being, of such joint-stock company or association, shall have the same force and effect as regards the joint rights, property, and effects of such joint-stock company or association, as if such suits and proceedings were prose- cuted in the names of all the shareholders or associates, in the manner now provided by law. 8 2. No suit so commenced shall abate by reason of Suits not o *' to abate. the death, removal, or resignation of such president or treasurer of such joint-stock company or association, or 198 Banking Laws of the the death or legal incapacity of any shareholder or asso- ciate during the pendency of such suit; but the same may be continued by or against the successor of the officer in whose name such suit shall have been com- menced. President 8 3. The president or treasurer of any such ioint-stoek and treas- ox •• to*be°°* company or association, shall not be liable in his own per- liabie. son or property, by reason of any suit prosecuted as above provided, by or against him, as the nominal plaintiff or defendant therein ; provided that such president or treas- urer shall not be exempted from any liability to which he may be otherwise legally subject as a stockholder or shareholder in such joint-stock company or association, ^^'aiuh § ^' ^otli™g herein contained shall be construed to de- hoiders. prive any plaintiff of the right, after jadgment shall be ob- tained against any such joint-stock company or association, as above provided, from suing all or any of the share- holders or associates therein, individually, as now pro- vided by law, or of the right to proceed, in the first in- stance, against the persons constituting any such joint- stock company or association, in the manner now pro- vided by law ; but if it shall appear to any court in which any suit shall be prosecuted, otherwise than is provided in the first section of this act, that the same is so prose- cuted for the purpose of vexatiously and oppressively en- hancing costs, such court shall not allow any more costs to be taxed and recovered in such suit than would be taxable and recoverable in case such suit was prosecuted in the manner provided in the first section of this act. Saving § 5. Nothing herein contained' shall be construed to confer on the joint-stock companies or associations men- tioned in tbe first section of this act, any of the rights or State of New Yoek. 199 privileges of corporations, except as herein specially pro- vided. § 6. This act shall take effect immediately. OHAP. 245. AN ACT TO AMEND, AND IN ADDITION TO THE SEVERAL ACTS RELATIVE TO JOINT-STOCK AS- SOCIATIONS. Passed April 15, 1854. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. Whenever in pursuance of its articles of association the property of any joint-stock association is represented by shares of stock, it may be lawful for said associations to provide by their articles of association that the death of any stockholder or the assignment of his stock shall not work a dissolution of the association, but it shall continue as before, nor shall such company be dissolved except by judgment of a court for fraud in its management or other good cause to such court shown, or in pursuance of its articles of association. § 2. Said association may also, by said articles of asso- ciation, provide that the shareholders may devolve upon any three or more of the partners the sole management of their business. § 3. This act shall in no court be construed to give said associations any rights and privileges as corporations. 200 Banking Laws of the CHAP. 314. AN ACT TO DECLARE AND EXTEND THE POWERS OP EXECUTORS, ASSIGNEES, RECEIVERS AND OTHER TRUSTEES, AND TO PROTECT THE RIGHTS OP CREDITORS AND OTHERS, AGAINST PRAUDS, AND POR OTHER PURPOSES. Passed April 17, 1858 ; three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows: Section 1. That any executor, administrator, receiver, assignee, or other trustee of an estate, or the property and effects of an insolvent estate, corporation, association, partnership or individual, may for the benefit of credit- ors or others interested in the estate or property so held in trust, disaffirm, treat as void, and resist all acts done, transfers and agreements made, in fraud of the rights of any creditor, including themselves and others, iaterested in any estate or property held by or of right belonging to any such trustee or estate. § 2. That every person who shall, in fraud of the rights of creditors and others, have received, taken, or in any manner interfered with, the estate, property or effects of any deceased person, or insolvent corporation, association, partnership or individual, shall be liable in tfie proper action to the executors, administrators, receivers, or other trustees of such estate or property, for the same, or the value of any property or effects so received or taken, and for all damages caused by such acts to any such trust estate. § 3. (Eepealed by chapter 245, Laws of 1880.) § 4. This act shall take effect immediately. State of New York. 201 CHAP. 456. AN ACT IN BELATION TO THE ASSESSMENT OF TAXES ON INCORPORATED COMPANIES. Passed April 15, 1857 ; tbree-fiftbs being present. TTie People of the State of New York, represented in Senate and Assembly, do enact as follows: Section 1. The fourteenth section of the fourth title certain sections re- of the thirteenth chapter of the first part of the Revised peeled. Statutes, entitled " Regulations concerning the assessment of taxes on incorporated companies, and the commuta- tion or collection thereof," and the ninth and tenth sections of said title as amended by chapter six hundred and fifty-four of the laws of eighteen hundred and fifty- three, are hereby repealed. § 2. The fifteenth section of the said title is hereby amended to read as follows : The amount of taxes assessed on all incorporated com- panies liable to taxation, shall be set down by the board of supervisors, in the fifth column of the corrected assess- ment roll, and shall form a part of the moneys to be col- lected by the collector. § 3. The capital stock of every company liable to taxa- capital stock. tion, except such part of it as shall have been excepted in the assessment roll, or as shall have been exempted by law, together with its surplus profits or reserved funds, exceeding ten per cent of its capital, after deducting the assessed value of its real estate, and all shares of stock in other corporations actually owned by such company, which are taxable upon their capital stock under the laws of this State, shall be assessed at its actual value, and 303 Bankim-g Laws of the taxed in the same manner as the other personal and real estate of the county. Deposits in § 4. The deposits in any bank for savings which are banks, etc. ^^g ^^ depositors, and the accumulations in any life in- surance company organized under the laws of this State, so far as the said accumulations are held for the exclusive benefit of the assured, shall not be liable to taxation, other than the real estate and stocks which may be owned by such bank or company, and which are now liable to taxation under the laws of this State. § 5. The twenty-first section of the said title is hereby amended to read as follows : Companies The comptroller shall furnish the attorney-general with and banks ^ •' " ply"°'°^ *° the names of all the companies and banks refusing or neglecting to pay the taxes imposed on them, with the amount due from them respectively, and the attorney- general shall thereupon file a petition in the supreme court against every such company or bank, for the dis- covery and sequestration of its property. tioTof*"^^ § 6. The supreme court, on the filing of such petition, proper y. ^^ ^^ ^^^ coming in of the answer thereto, may order such part of the property of such company or bank to be sequestrated, as shall be deemed necessary for the purpose of satisfying the taxes in arrear, with the costs of prose- cution ; and the court may also, at its discretion, enjoin such company or bank, and the ofiieers thereof, from any further proceedings under their charter or act of incor- poration, and may order and direct such other proceed- ings as shall be deemed necessary to compel the payment of such taxes and costs. § 7. This act shall take effect immediately. State of New Yoke. 303 OHAP. 143. AS ACT TO TAX STOCK CORPORATIONS FOR THE PRIVILEGE OF ORGANIZATION. Passed April 16, 1886; three-fifths being present. The People of the State, of New York, represented in Senate and Assembly, do enact as follows : Section 1. Every corporation, joint-stock company or Organiza- association incorporated by or under any general oroorpora- ^ -^ •' *= tions, etc, special law of this State, having capital stock divided into shares, shall pay to the State Treasurer, for the use of the State, a tax of one-eighth of one per centum upon the amount of the capital stock which said corporation, joint- stock company or association is authorized to have, and a like tax upon any subsequent increase thereof. The said tax shall be due and payable upon the incor- Duties of - . 1 . . . Secretary poration of said corporation, joint-stock company or of state association, or upon the increase of the capital thereof ; oierk'Z and no such corporation, joint-stock company or associa- tion shall have or exercise any corporate powers until the said tax shall have been paid. And the Secretary of State and any county clerk shall not file any certificate of incorporation or articles of association or certify or give any certificate to any such corporation, joint-stock com- pany or association, until he is satisfied that the said tax has been paid to the State Treasurer ; and no such com- pany incorporated by any special act of the Legislature shall go into operation or exercise any corporate powers or privileges until said tax has been paid as aforesaid. But this act shall not apply to literary, scientific. Proviso, medical and religious corporations or corporations organ- ized under the banking laws of this State or under chap- 304 Bakking Laws of the ter one hundred and twenty-two of the laws of eie^hteen hundred and fifty-one, entitled " An act for incorpora- tion of building, mutual loan and accumulating fund associations," and the acts amendatory thereof. (As amended by chapter 284, Laws of 1887.) Kevenue § 2. The taxes imposed by this act and the revenue how ap- plicable, derived therefrom, shall be applicable to the general fund and for the payment of those claims and demands which shall constitute a lawful charge upon that fund. § 3. This act shall take effect immediately. CHAP. 266. AW ACT TO PROVIDE FOR THE MORE CERTAIN RECOVERY OP STATE TAXES FROM DELIN- QUENT ASSOCIATIONS, CORPORATIONS AND JOINT-STOCK COMPANIES. Passed May 4, 1886; three-fifths being present; without the approval of the Governor.* The People of the State of New York, represented in Senate and Assembly, do enaet as follows : Better en- SECTION 1. For the better enforcement of chapter live foroement taxinTcor- ^lundred and forty-two, of the laws of eighteen hundred pora ions. ^^^ eighty and the acts amendatory thereof, it shall be lawful for any person having knowledge of the evasion of taxation under said acts by any association, corporation or joint-stock company liable to taxation thereunder, to report such fact to the Comptroller, together with such information as may be in his possession as may lead to *Not returned by the Governor within ten days after it was presented to him, and became a law without his signature. [Art. IV, sec. 9, Constitu- tion of the State of New York.] State of New Yokk. 305 the recovery of such taxes from said association, corpo- ration or joint-stock company ; and whenever in the opin- ion of the Attorney-General or Comptroller the interests of the State require it, either of them is hereby author- General''' and Comp- ized to employ such person so reporting such evasion to troUer. assist in the collection and preparation of evidence and in the prosecution and trial of suits for such taxes ; and so much of the sum collected from such delinquent association, corporation or joint-stock company, by reason of such report or such services, as shall have been agreed upon by such person and the Attorney-General or Comp- troller as a compensation therefor shall be paid to such person, provided that the sum so paid shall not exceed ten per centum of the amount so collected ; and provided further, that nothing whatever shall be paid to such per- son for such purpose unless there shall be a recovery of taxes from such delinquent association, corporation or joint-stock company by reason of such report or such services. § 2. This act shall take effect immediately. CHAP. 469. AN ACT RELATIVE TO PUBCHASERS OF THE FRANCHISES AND PROPERTY OF CORPORA- TIONS, WHOSE FRANCHISES AND PROPERTY SHALL HAVE BEEN SOLD BY MORTGAGE. Passed May 9, 1873. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. "Whenever the franchises, privileges, ease- when pur- chasers of ments, rights and liberties of any corporation, created ItS" o'f in- 206 BAiiTKiiTG Laws of the corporated by any act of the legislature of this State, or formed and companies *> 'J ^ ' mirtgageT i'l'^orporated under or by virtue of any general act may be- come a thereof, and empowered by said act to mortgage its porate. property or franchises, and the property, estate and effects of any such corporation, have been heretofore, or may be hereafter, sold by virtue of any mortgage executed by such corporation ; aud whenever the purchaser or pur- chasers thereof shall have acquired title to the same, in the manner prescribed by law, such purchaser or purcha- sers may associate with him or them any number of per- sons ; and upon making and filing articles of association, as prescribed by this act, such purchaser or purchasers and his or their associates, and their successors and assigns, being residents of this State, shall thereupon become and be a body politic and corporate, and may take and receive a conveyance of. and shall thereupon succeed to, possess and exercise and enjoy all the rights, powers, franchises, privileges, easements, liberties, prop- erty, estate and effects of which the title shall have been acquired and conveyed as aforesaid. whatcer- 8 2. In case the said corporation, whose franchises, tiflcate to ^ where cor- privileges, easements, rights, powers, liberties, property, wasinoor- estate and effects shall have been so sold as aforesaid, porated eraUaw^" shall have been incorporated under or by virtue of the provisions of any general statute or statutes of this State for the formation of corporations, the certificate so to be made and filed shall be in the form of, and shall state and set forth the particulars which in and by such statute or statutes were required to be stated and set forth in the original certificate of incorporation or articles of associa- tion of the said corporation. speo?ai § 3. In case the corporation whose franchises, privi- act. State of New York. 307 leges, easements, rights, powers, liberties, property, es- tate and effects shall have been so sold as aforesaid shall have been created by any special act of incorporation, then, and in that case, said certificates so to be made and filed shall state and set forth the following particulars, namely : 1. The name of the body politic and corporate so to be formed as aforesaid. 2. The amount of the capital stock thereof, which shall not exceed the amount of the capital stock of the said former or pre-existing corporation authorized by law at the time of such sale as aforesaid, and the number of shares of which the said stock shall consist. 3. The title and time of the passage of the said original act creating the said former corporation, and any other act or acts relating thereto. i. The number of the directors who shall manage the concerns of the said body politic and corporate, and the names of the first board of directors thereof, and who shall hold their office for one year and until others are chosen in their places. 8 4. The said certificate shall be executed in duplicate certifloate ^ to be ac- and acknowledged before some officer competent to take edg^'." acknowledgment of deeds. One of the said duplicates Duplicates shall be filed in the office of the secretary of State, and the other thereof shall be filed in the office of the clerk of the county in which the said corporation first men- tioned in this act had its principal place of business ; and thereupon, the said body politic and corporate so formed as aforesaid shall exist for the time, and may and shall possess, exercise and enjoy all the powers, privileges, rights, liberties, easements and franchises possessed by 308 Banking Laws of the the said former corporation, and in the same manner and to the same extent and with the same force and effect as the same could have been exercised by the said former corporation had not such sale as aforesaid been made. ffights, ^nd whenever, by the decree of the court having juris- newco^po^ diction of the foreclosure proceedings, it has been ad- ration. judged, determined and found by the court what powers, privileges, rights, liberties, easements and franchises were possessed and enjoyed by the former corporation at the time of entering such decree and were therein ordered to be sold, the same shall be possessed and en- joyed by the new corporation to which they shall have been conveyed under and by virtue of the decree of fore- closure and sale, as provided for in the act hereby Omission amended. But no omission in such decree to set forth in decree prove ""' or define any of the rights, privileges or franchises of rights of . , , , . ... newcorpo-such former corporation shall m any way impair the rights of such purchasers and of such new corporation to possess and enjoy all that was possessed by the former corporation at the time of such sale. (As amended by chapter 113, Laws of 1880.) Evidence. § 5. A copy of any articles of association filed in pur- suance of this act, and certified by the secretary of State and county clerk, with whom the same shall have been filed, or their deputies, to be a true copy of such articles and the whole thereof, shall be received in all courts and places as legal evidence of the incorporation of the said body politic or corporate, so to be formed as aforesaid. § 6, This act shall take effect immediately. State of New Yoek. 209 OHAP. 264. AN ACT TO AUTHOBIZE CORPOBATIONS ORGAN- IZED UNDER THE LAWS OP THIS STATE TO RE- DUCE THEIR CAPITAL STOCK. Passed May 15, 1878. The People of the State of New York, represented in Senate and AsaerrMy, do enact as follows : Seotion 1. Any corporation or company organized May di- under general or a special law of this state, and now ex- g^^,!^^' isting, or which may hereafter be organized under such general or special law, may diminish its capital stock, by complying with the provisions of this act, to any amount which may be deemed sufficient and proper for the pur- poses of the corporation. But nothing in this act shall be construed as to relieve any holder or owner of stock in such corporation from any personal liability existing prior to such reduction ; provided, that nothing in this Proviso as to 6Il6Cu act contained shall be construed to in any manner in-"*^"'' terf ere with, or affect any law now in existence, author- izing any corporation heretofore organized to reduce its capital stock. S 2. Whenever any company shall desire to call a meet- Notice ot " ^ ± ./ meeting to ing of the stockholders for the purpose of diminishing gtookf the amount of its capital stock, it shall be the duty of the trustees or directors to pubhsh a notice signed by at least a majority of them, in a newspaper in the county in which the business of the company is carried on, or its principal office is located, if any, shall be published therein, at least three successive weeks, and to deposit a written or printed copy thereof in the post-office, ad- dressed to each stockholder, at his usual place of resi- 27 310 Banking Laws of the dence, at least three weeks previous to the day fixed upon, for holding such meeting, specifying the object of the meeting, the time and place when and where such meet- ing shall be held, and the amount to which it shall be Vote ne- proposed to diminish the capital ; and a vote of at least cessary. two-thirds of all the shares of stock shall be necessary to a diminution of the amount of its capital stock. Proceed- 8 3. If at the time and place specified in the notice tags to "5 r r oipitai^'' provided for in the preceding section of this act, the stockholdei-s shall appear in person or by proxy, in num- bers representing not less than two-thirds of all the shares of stock of the corporation, they shall organize by choos- ing one of the trustees chairman of the meeting, and also a suitable person for secretary, and proceed to a vote of those present in person or by proxy, and if, in canvassing the votes, it shall be found that a sufficient number of votes has been given in favor of diminishing the amount of capital, a certificate of the proceedings showing a com- pliance with the provisions of this act, the amount of capital actually paid in, the whole amount of debts and liabilities of the company, and the amount to which the capital stock shall be diminished, shall be made, signed Certificate and verified bv the chairman, and such certificate shall be to be ao- edged'and acknowledged by the chairman, and filed in the office of the clerk of the county in which the business of the com- pany shall be carried on, and a duplicate thereof in the office of the secretary of state, with the approval of the comptroller indorsed thereon, to the effect that the re- duced capital is sufficient for the proper purposes of the company, and is in excess of all debts and liabilities of the company, exclusive of debts secured by trust mortgages, and that the actual market value of the stock of the com- State of New York. 2H pany prior to the reduction of the capital was less than the par value of the same, and when so filed, the capital stock of such corporation shall be reduced to the amount specified in such certificate and the amount of capital left in the possession of the company over and above the amount to which the capital shall be so reduced shall be returned to the stockholders pro rata at such times and in such manner as the trustees or directors shall determine. (As amended by chapter 306, Laws of 1882.) § 4. This act shall take effect immediately. CHAP. 489. ben AW ACT TO PROTECT STOCKHOLDERS OP COR- PORATIONS FROM THE WRONG-DOINGS OP DI- RECTORS IN CERTAIN CASES. Passed June 11, 1885 ; three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. Whenever the directors named in thewhe- directors articles of association of any corporation organized under "^f^^°\°' any general law of this state neglect or refuse during the Lws to^" _ enable first year of the corporate existence to adopt the by-law ^'f^^^^ required by law to enable stockholders to hold the election, acts etc., annual election for directors, and where by such neglect "Jg^of^n- the said directors hold over and continue to be directors °^^' ^° ' after the expiration of the first year of the corporate existence, all acts and proceedings of the directors when so holding over, done for and in the name of the com- pany, designed to charge upon the company any liability or obligation for the past services of any director so hold- 312 Banking Laws of the ing over, or for the past services of an officer, or attor- ney, or counsel appointed by them, and such liabihty or obhgation shall be considered fraudulent and void. wWoh'auy § ^- When directors of any such association or corpora- boidermay tion are SO holding over by their wrongful neglect of apply for proceed- ^^^7 beyond the term for which they were appointed or tion'eto." elected, and an action has been brought against the company by the procurement of any of them to enforce any claim or obligation declared void by the preceding section, and such action is in the interest or for the bene- fit of any director or directors so holding over, and the company has by their connivance made default in such action, or consented to the validity of the claim or obligation so sought to be enforced against the company, any stockholder of the company may apply to the supreme court by affidavit, setting forth the facts, for a stay of the proceedings in such action, and on proof of the facts in such further manner and upon such notice as the court may direct, the supreme court may stay such pro- ceedings or set aside and vacate the same or grant such other relief as to the court may seem proper, and which will not injuriously affect an innocent party, who with- out notice of such wrong-doings and for a valuable con- sideration, has acquired rights under such proceedings. When 8 3. When the directors of any association or corpora- stookhold- " J r eiertdT- tion shall neglect or have neglected to adopt a by-law rectors. /. i i t • providing for the annual election of directors for sixty days after the first year of the corporate existence, the stockholders thereof may elect directors in the place of the directors holding over in the manner following: Stockholders entitled to vote for directors of such association or corporation as prescribed by section eight, State of New Yokk. 213 chapter eighteen, title four, part first of the Revised Statutes, may meet after previous notice in writing given by them to all the stockholders, at least fifteen days before such meeting, of the time and place when and where such meeting will be held, for the purpose of Notice and electing directors ; and it shall be the duty of any officer mee'tae- or other person having charge of the book or books of the association or corporation containing the names of the stockholders, to allow the same to be examined by any stockholder aforesaid, or his attorney, for the pur- pose of giving such notice. The place of such meeting shall be the principal office of such company, or in case it has no such office, at the place in this state where its principal business has been transacted, or if access to such office or place is denied, then at some other place to be designated in such notice in the city, town or village where the principal office of such company is or was last located. At such meeting such stockholders shall elect oflil?tton. Majority two or more inspectors of election. If at such meeting *° elect, a majority of the votes cast on stock entitled to be voted on for directors, as prescribed by said section eight, chap- ter eighteen, title four, part one of the Revised Statutes, shall be voted upon and cast for one ticket for directors, the persons so named and voted for as directors shall thereupon be the directors of such association or corpora- tion until the next annual election and until others are elected and qualified in their stead, and without reference to the time when they became stockholders. In the ab- in absence •' of books, sence at such meeting of the books of the association or Irs'ofEer- ' ing to vote corporation, showing who were and are stockholders of 5°^™^®^^ the association or corporation, each stockholder, in order and veri:§ same. to be entitled to vote at such election, shall make or pre- 314 Banking Laws of the sent a statement in writing to be signed and verified by bim under oath before a notary public or other person authorized to administer oaths, setting forth the number of shares of the stock of such company standing in his name on its books, and upon which he is entitled to vote as prescribed by the section of the Revised Statutes here- inbefore referred to, and which is then owned by him and standing on the books of the company in his name, and if known to him he shall also state the whole num- ber of shares of stock issued by said association or corpo- ration at the time when the election ought to have been held, and on filing such affidavit or verified statement with the inspectors, he shall be entitled to vote on such stock so appearing to be owned by him and standing on Return to the books of the company in his name. The inspectors be made by inspect- shall return and file such verified statements, together ors and ' ° county with a Certificate of the results of the election, which clerk's office. shall be verified by them, with the clerk of the county in which siich election is held, and thereupon the persons so elected shall be the directors of such association or corpo- ration as aforesaid. stockhoid- § ^- The stockholders aforesaid at the meeting author- ers may . , , i , . . . i i . . i . adopt by- ized by the precedmg section, in addition to electing such meet- (jjrectors, as aforesaid, may adopt a by-law providing for the future annual meetings and election of directors, such by-laws shall be adopted in the same manner and by the same number of votes as is above prescribed for the election of directors, and shall have the same effect as if such by-law had been adopted by the directors of the company. § 5. This act shall take effect immediately. State of New Yoek. 215 CHAP. 505. AN ACT TO PROVIDE FOR RECORD EVIDENCE OP THE NAMES AND MEMBERSHIP OP JOINT-STOCK ASSOCIATIONS, AND POR THE MODE OP PROOP OP THE MEMBERSHIP THEREOF. Passed June 13, 1885 ; three-fifths being present. The People of the State of New York, represented in Senate and Assemhly, do enact as follows : Section 1. Every joint-stock association transacting certificate . , , . , . , to be filed. business within this state shall, within sixty days after this act shall take effect, file with the secretary of state, and also with the clerk of the county where the principal business of such association is carried on, a certificate, in writing, signed and sworn to by the president and treas- urer of such association, stating the name of such associa- tion, the date of its organization, the law or statute under _. which it is organized and doing business, the number of " * *' associates required thereby, and whether the association comprises said number, its principal place of business, and the names and places of residence of its officers. § 2. Every such association shall also annually, during Annually in Janu- the month of January in each year hereafter, file a like ^''^JSf t. certificate with the secretary of state, and with the clerk of the county where the principal business of such asso- ciation is carried on, stating all the facts required to be stated by the certificate referred to in the preceding section. § 3. The several certificates so filed shall be recorded ^°,5||^" by the secretary of state, and by the said county clerk, respectively, in a book or books to be provided for that purpose. The fees for recording such certificates shall be ' 316 Bakeing Laws of the the same as are prescribed by law for the recording of deeds and other conveyances, and shall be paid by the association filing the same. Evidence. § '^- The Certificates so filed, and the records thereof, and copies of such certificates or records, certified by the officers with whom the same are filed, shall be presump- tive evidence of the truth of all the facts therein stated against all the persons named in said certificates as officers or members thereof. Officers, § 5. No officer or member of any joint-stock association etc., not privi- shall be privileged from testifymg in any suit, action or ying. pj.QQgeding against said association, or against any of the members thereof, in respect to the existence of said asso- ciation, or the members composing the same, or of any facts relating to the organization thereof. Penaityfor § 6. The officers of any joint-stock association, who failure to comply shall fail to comply with the provisions of this act, shall *"*• be jointly and severally liable to a fixed penalty of fifty dollars for every day during which the failure to comply with the provisions of sections one and two of this act shall continue, to be recovered in a suit brought in the name of the people of the state of New York by the attorney-general. All penalties that have accrued at the time of the commencement of such action may be recov- ered therein, or a separate action may be maintained for one or more of such penalties. § 1. This act shall take effect immediately. State oe New Yoek. 217 CHAP. 599. AN ACT IN BELATION TO JOINT-STOCK COMPA- NIES AND CORPORATIONS HAVING A CAPITAL OF LESS THAN ONE HUNDRED THOUSAND DOL- LARS. Passed July 4, 1881 ; three-fifths being present. The, People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. Any joint-stock company or corporation, May re- duce with a capital of less than one hundred thousand dollars, number of '^ ' trustees. organized under a special act of the legislature, having more than seven trustees, may reduce the numher of its trustees to not less than seven, to be elected annually at^™"^"" the time appointed in its articles of incorporation ; pro- vided that a majority of the stockholders of such joint- stock company or corporation shaU so determine, at a meeting to be held at the usual place of meeting of the trustees of such joint-stock company or corporation, on thirty days' previous notice, in writing, to each stock- holder of record ; such notice shall be signed by not less than five stockholders, and shall be delivered in person or deposited in the post-office directed to each stockholder at his last known address, and upon the election of the trustees as herein provided, the term of office of the trus- tees in office at the time of such election shall cease and determine. 318 BANKme Laws of the CHAP. 135. AN ACT FOB THE BELIEF OP COBPOEATIONS OR- GANIZED UNDEB GENEBAI. LAWS. Passed April 5, 1870. Tlie People of the State of New York, represented in Senate and Assembly, do enact as follows : amemied SECTION 1. The directors of any corporation, organized cates, how Under any general act for the formation of companies, in and taken, -^j^ose Original Certificate of incorporation any informahty may exist, by reason of an omission of any matter re- quired to be therein stated, are hereby authorized to make and file an amended certificate or certificates of incorpo- ration, to conform to the general act under which said corporation may be organized ; and upon the making and filing of such amended certificate, the said corporation shall, for all purposes, be deemed and taken to be a corporation from the time of filing such original cer- tificate. Proviso. § 2. Nothing in this act contained shall in any manner affect any suit or proceeding, at the time of filing such amended certificate pending against said corporation, or impair any rights already accrued. § 3. This act shall take effect immediately. State of New York. 219 CHAP. 93T. AN ACT TO ENABLE COMPANIES OE CORPOBA- TIONS, ORGANIZED UNDER ANY GENERAL LAW, TO EXTEND THE TERM OP THEIR EXIST- ENCE. Passed May 17, 1867. The People of the State of New York, represented in Senate and AsiemUy, do enact as follows : Section 1. Any company or corporation heretofore formed under any general law of this State, at any time within three years of the expiration of its term of existence, may extend the term of existence of such company or corporation beyond the time mentioned in the original articles of association or certificate of incor- poration, by the consent of the stockholders owning two- thirds in amount of the capital stock of such company or corporation, in and by a certificate to be signed by such stockholders, and acknowledged or proved, so as to enable them to be recorded, which certifieatp shall be filed in the office of the Secretary of State, and in the office of the clerk of the county in which its original certificate or articles of association, if any, are filed or recorded ; and the said Secretary of State and the clerk of such county shall, upon such filing, record the same in the books kept in their respective offices for the record of articles of association, and make a memoran- dum of such record in the margin of the original articles of association, in such book, and thereupon the time of existence of such company, shall be extended, as desig- nated in such certificate, for a term not exceeding the term for which said company or corporation was organized in the first instance. § 2. This act shall take effect immediately. 230 BANKiifG Laws of the CHAP. 22. AN ACT EEQUIRING ALL CERTIFICATES OF IN- COBPOBATIOITS, HEREAFTER FILED PURSUANT TO LAW, EITHER IN" THE OFFICE OF THE SECRETARY OF STATE, OR IN THE OFFICE OF Alfy COUNTY CLERK, TO BE RECORDED THEREIN, AND REGULATING THE FEES THERE- FOR. Passed March 2, 1881; three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows : AUcertifl- Seotion 1. All Certificates of incorporations hereafter cates of ^ ration to incorporated under any of the laws of this state, required be re- corded, by law to be filed in the office of the secretary of state, or in the office of any county clerk, shall be duly recorded in the office where the same shall be filed, in books specially provided therefor, which books of record shall ■pees, be properly indexed. The same fees shall be chai'ged for the recording of such certificates as are now provided by law for the recording of deeds. And the secretary of state and such county clerk shall neither file nor record any such certificate in their office unless the fees there- for are first duly paid. § 2. This act shall take efEect immediately. State of JNew York. 231 OHAR 65. AIT ACT TO REGULATE THE EXECUTION AND TRANSFER OP NEGOTIABLE INSTRUMENTS GIVEN FOR PATENT RIGHTS. Passed March 28, 1877. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. Whenever any promissory note or other Notes •' '■ •' given for negotiable instrument shall be given, the consideration ^gh'ta* must oon- of which shall consist in whole or in part of the right to tain the ■*- ° words make, use or vend any patent invention or inventions, a patent °' right," etc. claimed or represented by the vendor at the time of sale to be patented, the words " given for a patent right," shall be prominently and legibly written or printed on the face 6f such note or instrument above the signature thereto ; and such note or instrument in the hands of any purchaser or holder shall be subject to the same defenses as in the hands of the original owner or holder. § 2. If any person shall take, sell or transfer any prom- Persons issory note or other negotiable instrument not having the notes^given 1 // • p I 1 • 1 11 • • -I for patent words "given for a patent right" written or printed rights with ° ^ " ^ the words legibly and prominently on the face of such note or in- a^iared 1 1 • 1 1-1 guilty of a strument, above the Signature thereto, knowing the con-miBfle- '-' ' o meaner. sideration of such note or instrument to consist in whole or in part of the right to make, use or vend any patent invention or inventions, claimed as aforesaid to be patented, every such persra or persons shall be deemed guilty of a misdemeanor. § 3. This act shall not apply to a promissory note given solely for the purchase price or the use of a patented article. 222 Banking Laws ojf the CHAP. 326. AN ACT TO EEQUIRE PUBLIC OFFICIALS AND OTHER PERSONS RECEIVING AND DISBURSING MONEYS OF THE PEOPLE OF THE STATE OP NEW YORK, TO DEPOSIT THE SAME IN SOLVENT BANKS, AND TO REQUIRE BANKS RECEIVING SUCH MONEYS ON DEPOSIT TO EXECUTE AND GIVE BONDS AS SECURITY THEREFOR. Appkoted by the Governor May 18, 1888. Passed, three-fifths being present. T/ie People of the State of New York, represented in Senate and Assembly, do enact as follows : puSfio'*"' Section 1. All officials of the State of JSTew York, and offloera of other persons receiving and disbursing moneys belonging to the people of said State for public purposes, shall be and are required to deposit, and keep, all such moneys received by them, deposited to their official credit in some responsible bank, or banks or banking house. ?omp°'^ to be designated by the Comptroller of said State, until said moneys shall be paid out and disbursed according to law. Banks to § 2. Every bank or banking house that has received or stSe. ° shall receive on deposit any moneys belonging to the people of the State of j^ew York shall, when so required to do by the Comptroller, execute, deliver and file in the office of the Comptroller of said State at the city of Albany, a bond or undertaking to the the* people of said State, in such sum and with such sufficient guarantee and Howap- sureties as shall be required and approved bv said Comp- provedand _ . ■* ' ■' ^ filed. troUer, for the safe keeping and prompt payment upon legal demand therefor, of all such moneys held by or on deposit in such bank, with interest thereon upon dailj' or * So in the original. State of New Yoke.. 223 monthly balances, and at such rate as the said Comptroller ferest' hm? shall fix and approve. § 3. All bonds, undertakings, gi^rantees and covenants ^°"^^ ^iw or agreements of sureties, hereafter executed or given by or in behalf of any bank or banking house to the people of the State of New York, shall be approved as to form by the Attorney-General indorsed thereon or annexed thereto. § 4. The foregoing provisions of this act are in addition Proviso, to and shall not be construed as in conflict with, or to change, any special or other general laws requiring bonds to be given by any public ofiicials of this State, or any banks receiving on deposit moneys belonging to the peo- ple of this State, nor shall it apply to the Treasurer of said appiy°o*° state State. Treasurer. § 5. This act shall take effect immediately. CHAP. 191. ATT ACT TO EHTOBCE THE ASSESSMENT OF SHAEEHOLDERS IN BANKING ASSOCIATIONS TO MAKE GOOD A DEFICIT IN CAPITAL. Passed May 20, 1882 ; three-fifths being present.* TTie People of the State of New Torh, represented in Senate and Assembly, do enact as follows: Section 1. Whenever the superintendent of the bank department shall find a deficit in the capital of a banking ^rinlilSd- association below the amount required by law, or by its make re- ^ J 7 J quisition certificate or articles of association, and the said superin- good^de- flciency. tendent shall make a requisition on said banking associa- *Not returned by the governor within ten days after having been re- ceived by bim, and became a law without his signature, May 20, 1882 224 Banking Laws of the tion to make such deficiency good, it shall he the duty of the directors of said association to give notice of such requisition to each sha^jpholder of said association, and of the amount of his respective assessment for such purpose, by a written or printed notice, mailed to his place of resi- dence, stock °' § ^" ^-^ ^^7 shareholder or shareholders in such bank- fusing to" ing association shall refuse or neglect to pay the pro rata make loieno*' asscssment so ordered, to make said deficit good, within ^fl. * sixty days from the date of said notice, the directors of such association shall have the right to sell, to the highest bidder, at public auction, the stock of such shareholder or shareholders, after giving previous notice of such sale for two weeks, in a newspaper of general circulation, published in the place or county where such banking as- sociation is located, provided that such stock shall not be sold for a smaller sum than the valuation put on it by the bank superintendent in his determination and certificate ; and the necessary costs of the sale shall be paid out of the avails of said stock sold. § 3. This act shall take efEect immediately. CHAP. 517. AJS ACT TO AUTHORIZE THE CHANGE OP LOCA- TION OF BANKS, BANKING ASSOCIATIONS OR INDnriDUAL BANKERS. Passed June 3, 1887 ; three-flfths being present. Tlie People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. Any bank, banking association or individual bisfne'ss, banker, now or hereafter organized under the laws of this State of New Yoke. 225 State, may apply at any special term of the supreme applica- tion for court, held in the county in which the office of discount change of. and deposit of such bank, banking association, or indi- vidual banker shall be located for an order to authorize it to change its place of business to another place in the same or an adjoining county.* § 2. Whenever a bank, banking association, or indi- Pubiioa- vidual banker shall propose to change its location, ac- applies^* cording to the preceding section, notice of intention to make such application, signed by the two principal of- ficers of the bank, banking association, or individual banker, shall be published once a week for four weeks in a newspaper published in the city of Albany and also for the same period of time in a newspaper published in the county in which the office of the bank, hanking associa- tion, or individual banker, is located, such newspapers to be designated by the Superintendent of the Banking De- partment ; and it must appear to the satisfaction of the court that the notices heretofore provided for have been published as required, when the application for leave to make the desired change in location shall be made. Such application shall be bv petition in which shall be set forth Petition J: i -^ ^ and appli- the grounds of the application, which petition shall be how°eie- signed by a majority of the board of directors of the cor- poration and shall be accompanied by the written assent to the proposed change of location of at least two-thirds in amount of the shareholders of such bank, banking as- sociation or individual banker, accompanied by the ap- proval in writing of the Superintendent of the Banking Department. * Banks changing location, even though in the same city, required to conform to this act, see opinion of attorney-general, page 449. 29 3S6 Banking Laws of the coiTrt to°* § ^- ^^ •'^^ '^o"^' *° which the application is made shall Ippiica- be satisfied that there is no reasonable objection to such tion. corporation changing its location, it may make an order authorizing the corporation to change its place of busi- ness to the location designated in the petition. A copy Order how of Said Order shall be filed with the clerk of the county in filed and •' published, vehich said corporation is located, and also in the office of the Superintendent of the Banking Department, and the same shall be published once in each week for four suc- cessive weeks in the newspapers in which the notice of application was published. Removal | 4. When the requirements of this act shall have been location, fu^y complied with, the corporation applying for leave to change its location, may, upon or after the day speci- fied in the order of the court, remove the property and effects of the corporation to the location designated in such order, and thereafter its sole business location shall be the location specified in the order of the court. In Eights of such new location the said corporation shall have all the corpora- removal!'^ rights and powers to which it was entitled at its former location ; but no such change of location shall in any manner lessen or impair any liability of such corporation incurred or existing at the time such change of location was made. § 5. This act shall take effect immediately. State of New Yoek. 237 CHAP. 518. AN ACT TO AUTHORIZE BANKS, BANKING- ASSO- CIATIONS AND TRUST COMPANIES TO CHANGE THEIR NAMES. Passed June 3, 1887 ; three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows: Section 1. Any bank, banking association or trust Change of •^ ' ^ name, ap- company organized under the laws of this State may ap- for!*''''"' ply at any special term of the supreme court sitting in the county in which such bank, banking association or trust company shall be located, for an order to authorize it to assume another corporate name. § 2. Such application shall be by petition, which shall fi"n"f " set forth the grounds of the application and shaU be veri- appUoa- tion. fied by the chief officer of the corporation and shall be approved by the Superintendent of the Banking Depart- ment. Notice of such application shall be published for four weeks in a newspaper published in the city of Albany, and also for the same period of time in a news, paper published in. the county in which such bank, bank- ing association or trust company shall be located, such newspapers to be designated by the Superintendent of the Banking Department ; and it must appear to the satisfac- tion of the court that such notice has been so published, that the application is made in pursuance of a resolution Resolution ^ ' ' of direot- of the directors or trustees of the corporation applying °^^- and has been approved by the Superintendent of the Bank- ing Department. § 3. If the court to which such application is made coiTrt W* shall be satisfied by such petition, so verified and ap- piicdtftfn. 228 Bankin'G Laws of the proved, that there is no reasonable objection to such cor- order how poration changing its name, it may make an order author- iiled and published, jzjng jt to assume the proposed new corporate name. A copy of the said order shall be filed in the ofiice of the Superintendent of the Banking Department and with the clerk of the county in which said corporation is located, and be published at least once in each week for four suc- cessive weeks in the newspaper in which the notice of the application was published. Change of 8 4. "When the requirements of this act shall have been name, ^ take'effeot. Complied with, the corporation applying for a change of name may, from and after the day specified in the order of the court, be known by and use the new corporate name designated in the order of the court. Effect o£ § 5. No suit Or legal proceeding commenced by or in uame. behalf of or against any such corporation, shall abate by reason of a change of its corporate name made as herein authorized. Such change of the corporate name of the said corporation or company shall in no way affect the rights or liabilities of said corporation or company. AD Rights and obligations of said corporation or company may be en- obligation "^ ^ r j .! piny,™' forced against said corporation or company in the changed affected name, and all actions and proceedings commenced and thereby. ^ ° pending against said corporation or company at the time said corporate name is changed shall be continued in the name in which said action or proceedings were com- menced, or the court may, on the application of either party, allow the action or proceeding to be continued in the corporate name to which said corporation or company has been changed. § 6. This act shall take effect immediately. State of New Yokk. 229 CHAP. 482. AN ACT AUTHORIZING- ANY LIFE INSURANCE COMPANY, OR ANY TRUST OR LOAN COMPANY TO INVEST THEIR FUNDS IN BONDS ISSUED BY ANY COUNTY, TOWN OR VILLAGE OP THIS STATE, PURSUANT TO ANY LAW OP THIS STATE. Passed April 30, 1868. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. Any life iusurance company, or any trust or loan company, may, by the direction and consent of two-thirds of their respective boards of directors, managers or finance committee purchase, or invest, by loan or otherwise, any of their funds in the bonds issued by any county, town or village of this State, pursuant to any law of this State, anything in the charter of either of said companies to the contrary, notwithstanding. § 2. This act shall take efEect immediately. CHAP. 425. AN ACT TO AUTHORIZE THE APPOINTMENT OP TRUST COMPANIES AS TRUSTEES, GUARDIANS, RECEIVERS OR COMMITTEES OP A LUNATIC, IDIOT, OR HABITUAL DRUNKARD. Passed June 8, 1885; three-fifths being present. The People of tlie State of New York, represented in Senate and Assembly, do enact as follows : Section 1. Any court having jurisdiction to make^°°^^'^^ appointments of trustees, guardians, receivers, committees panies, of the estates of lunatics, idiots, or habitual drunkards, *'"• 230 Banking Laws of the or any other fiduciary appointment, may, in its discretion, appoint any trust company, duly incorporated under the laws of this state, and that may have been legally desis;- nated as a depository of moneys paid into court, to be trustee, guardian, receiver, or committee of the estate of a lunatic, idiot, or habitual drunkard, or to act in any other fiduciary capacity without giving security or upon giving such security as the said court shall direct, men'ts"*' § ^' ^'^ appointment heretofore made by any of said fore made courts of a trust Company as trustee, guardian, receiver, not invalid _ ^ •' . . . of'^secu'-' °^ committee of the estate of a lunatic, idiot, or habitual drunkard, and no act heretofore done or which may be done under and by virtue of such appointment shall be deemed to be invalid for the reason that security had not been required by the said court, or given by the said trust company, upon such appointment. § 3. In all cases of such appointments having been made without security, the said courts shall have power, upon proper application, to require any company which shall have been so appointed, to give such security as to the court shall seem proper, or in default of such com- pany giving security as required, to remove such company from such appointment. CHAP. 546. Alf ACT TO PROVIDE FOR THE ORGANIZATION OF TRUST COMPANIES, FOR THEIR SUPERVISION, AND FOR THE ADMINISTRATION OF THEIR AF- FAIRS. Passed June 8, 1887; three-fifths being present. TTie People of the State of Nev) York, represented in Senate and Amernbly, do enact as follows: ratoray SECTION 1. At any time hereafter any number of State ov New York. 331 natural persons, not less tlian thirteen, may associate themselves together for the purpose of organizing a trust company in accordance with the provisions of this act ; but three-fourths of such persons shall reside in this State. § 2. Such persons, under their hands and seals, shall organiza- ^ ' ' tion oer- execute an organization certificate, which shall specifically statements in. state : First. The name assumed to distinguish such associa- corporate ° name. tion and to be used in its dealings, which shall be in no material respect similar to the name of any other trust company organized and doing business in this State. Second. The place where its business is to be transacted. Location. Third. The amount of capital stock and the number of ^^^^^^^ shares into which the same is to be divided. Fourth. The name, residence and post-office address of ^f ^em-°* each member of such association. ■ Fifth. The term of existence of such association, which '■^^rm of ' existence. shall not exceed fifty years. Sixth. A declaration that each member of such asso- peoiara- tion as to elation will accept the responsibilities and faithfully dis- *™^*^*^- charge the duties of a trustee in such institution if elected to act as such, when authorized under the provisions of this act. § 3. Such certificate shall be executed in duplicate, and ^ow'exe-^' be duly acknowledged before an officer of this State mel. authorized to take the acknowledgment of conveyances of real estate for record, and shall, within sixty days of such acknowledgment, be filed one copy in the office of the county clerk of the county wherein such trust company is proposed to be located, and one copy in the office of the Superintendent of the Banking Department of this State. 232 Banking Laws of the Notice of 8 4. Previous to filinsr the organization certificate, as intention ^ o o ize?tfow' provided in the last preceding section, a notice of intention to organize such trust company shall be published at least once a week for four weeks, in a newspapsr to be desig- nated by the Superintendent of the Banking Department published in the city where -such trust company is pro- state- posed to be located. This notice shall specify the names' mentsoon-J^ '- " notice/° of the proposed corporators, the name of the proposed trust company and the location of the same as set forth iu the organization certificate ; and if there is any trust company or trust companies organized and doing business in such city, a copy of such notice shall also be sent to each trust company so organized and doing business, at least fifteen days before the filing of the organization cer- tificate as provided for in the last preceding section, tobi^lla § ^- CFpon the receipt of any such organization certifi- inatioa" cate at the ofiice of the Superintendent of the Banking by Banl£ ^ ° Supt. Department, if the same is in due form and duly executed according to the provisions of sections two and three of this act, and is accompanied by evidence satisfactory to the Superintendent of the proper service and publication and service, in good faith, of the notice required in the last preceding section, he shall forthwith indorse the same, over his official signature, " filed for examination," with the date of such indorsement. Bank R 6. If such Certificate shall not be in form and sub- supt. may ^ amen™ Stance as required by section two of this act, or shall not ment of certifloate. be duly and properly acknowledged, as required by sec- tion three of this act, or shall not be accompanied by . evidence satisfactory to the Superintendent, of the publi- cation and service in good faith, according to the intent and purpose of this act, of the notice required by section State of New Yoke. 233 four of this act, the Superintendent shall refuse to file such certificate until the same shall be amended in con- formity to the provisions of this act. § 7. It shall be the duty of the Superintendent of the To asoer- ° J r (ain as to Banking Department and ho shall have power in regard co?po- "' raters, etc. to any organization certificate so filed by him as hereinbe- fore provided, to ascertain, from the best sources of in- formation at his command, whether the general fitness for the discharge of the duties appertaining to such a trust of the persons named in such certificate is such as to command the confidence of the community in which snch trust company is proposed to be located, and whether aiso as to 1^ ■' ^ r ' necessity the public convenience and advantage would be promoted *'>«'^8of. by such establishment. 8 8. If the superintendent shall be satisfied from his May issue o i certificate knowledge, or from information obtained pursuant to zatton!""' after sixty the last preceding section, that the organization of a trust ^^y^- company, as proposed in such certificate, will be a public benefit, he shall, within sixty days after the same has been filed by him for examination, issue, under his hand and official seal, a certificate of authorization to the persons named in such certificate, or to them, or to a portion of them, together with such other persons as a majority of those named in such organization certificate shall in writ- ins approve : which certificate, so issued by him, shall certificate o ff f ' J J to author- authorize the persons named therein to become a trust ifon o™"' , . , trust com- company, as designated m the organization certificate, pa"y. subject to the provisions of this act ; provided, however, that no person shall be named in such certificate of au- thorization, who shall not have diily made and acknowl- edged the declaration prescribed in subdivision six of sec- tion two of this act. 234 Banking Laws of the Certificate 8 9. The Superintendent shall transmit such certificate of authori- " ^ how°flied. of authorization to the county clerk of the county in which the trust company so authorized is to be located, who shall file the same and attach it to the organization certificate previously filed by him, relating to the organiza- tion of such trust company ; and the superintendent shall also file a duplicate copy of such certificate in his own ofiice. fu'^^ ma § ^^- ^^ ^^® superintendent shall not be satisfied that oiTefusa™ the establishment of a trust company, as proposed in to issue of a'lithorl- ^"^ Organization certificate filed by him, is expedient and desirable, he shall, within sixty days after tbe filing of such certificate by him, and instead of giving the certifi- cate of authorization provided for by section nine, give notice to the county clerk of the county in which such trust company is proposed to be located, that he refuses to issue a certificate of authorization for such trust com- pany, which notice shall be forthwith filed by the county clerk with the organization certificate of such trust com- pany. Body cor- s H. Upou the filing of any such certificate of porate and or n j created, authorization of a trust company as hereinbefore pro- uponfiliDg, vided, the persons named therein, and their successors, shall thereupon and thereby be duly and lawfully con- stituted a body corporate and politic, and shall be vested with all the powers, and charged with all the liabilities conferred and imposed by this act. Bank § 12. It shall be the duty of the Superintendent of the SSination Banking Department, and he shall have power, before as to cap- , „ - _ , itai. issuing the certificate of authorization aforesaid, to such association, to examine or cause an examination to be made, in order to ascertain whether the requisite capital State of New Yoek. 335 of said association has been paid in, in cash ; and it shall be unlawful for said association to commence business until such certificate of authorization has been granted. S 13. Before entering; upon active business said associa- List of tion shall file with the Superintendent of the Banking be flfed' '" with BaDk Department a list of its shareholders, giving the name, ^"p'- residence, post-office address and number of shares held by each of them, respectively, which list shall be verified by the two principal officers of the company. The said Ts to re°°* association, in its business and transactions, shall be sub- examina- tions, etc., ject to the provisions of sections two hundred and nine- ^pp'^^^^ie. teen to two hundred and thirty-four, inclusive, of chapter four hundred and nine of the laws of eighteen hundred and eighty two. § 14. The affairs of said company shall be managed, f°^\^ °' and its corporate powers exercised, by a board of trustees of such number, not less than thirteen nor more than twenty- four, as shall from time to time be prescribed by its by- laws. The persons named in the organization certificate, or such of them, respectivel}', as shall become holders of at least ten shares of the said capital stock, shall constitute the first board of trustees of the said company, and may j^^^^^'^ add to their number, not exceeding the limit of twenty- four aforesaid, and shall severally continue in office until others are elected to fill their respective places. Within six months from the time when said company shall com- mence biisiness, it shall be the duty of the members of said first board of trustees to classify themsel ves by lot ^jo^^^ ^'f "*' into three classes, as nearly equal as may be. The term of office of the first class shall expire on the third Wednesday of January, next following such classification ; the term of office of the second class shaU expire one 336 Bankikg Laws of the year thereafter ; and the term of office of the third class shall expire two years thereafter. At or about the time of the expiration of the term of the first class, and Annual annually thereafter, a number of tmstees shall be elected elections. equal to the number of trustees in the class whose term will then expire, who shall hold their office for three years, or until their successors are elected. Notice of 8 16. Such election of trustees shall be held annually annual " *' how pub- at the office of the company in such manner, and at such lished. time and upon such public notice, not less than ten days by advertisement in at least one newspaper approved by the Superintendent of the Banking Department, published in the city where such trust company is located, as shall uS'?n case' ^® prescribed by the by-laws. In case of failure to elect to elect, on the day named for that purpose in such notice, the trustees whose regular terms of office do not that year expire may proceed to elect a number of trustees equal to the number in the class whose term that year expires, or such number as may have failed of election, and the persons so elected, together with the trustees whose terms of office shall not that year expire, shall constitute the board of trustees until another election shall be held according to law. Trustees shall be re-eligible, Vacancies and Vacancies occurring in the intervals of election shall how filed. be filled by the board. Election of 8 16. Everv election of trustees shall be by ballot, and trustees by <3 ./ ./ i ballot. ^ plurality of votes shall elect ; and at each annual elec- tion for trustees three persons shall be chosen in the same manner, by the persons entitled to vote for trustees, as Inspectors inspectors at the next succeeding election, whose duty it shall be to act as such, and any two of them shall be com- petent to act. Three inspectors shall be appointed by the State of New Yoek. 237 board to act as such at the first election of trustees, and such appointment shall be made at least one month previ- ous to such election. No trustee or officer in said com- pany shall act as such inspector, and no inspector shall be elected a trustee at any election of which he acts as in- spector. § 17. At every annual election for trustees, every share- voting " "^ T J upon holder, unless legally disqualified, shall be entitled to one iSf "' vote, either in person or by proxy in writing, for trustees, for every share of capital stock standing in his name on the books of the company. § 18. The trustees shall have power to make and use a Trustees' ^ *^ powers common seal, which may be affixed by making an impres- of. " '^^ sion directly on the paper, and alter the same at pleasure, and shall have power from time to time, to make and establish such by-laws, rules and regulations, not incon- sistent with the laws of this State or of the United States, as they shall deem expedient for the conduct and management of the business, affairs and property of said company ; for the issue and transfer of the capital stock of said company ; for determining the time and manner of holding elections and meetings of the company and of the trustees, for the filling of vacancies in the board of trustees, and for the conduct, management and regulation of all other matters that may appertain to the concerns of said company; and they may prescribe the duties and fix the compensation of all officers and agents of the com- pany. The said trustees shall elect one of their number President president of the board, and appoint such other officers °*^''®'''- and agents as they may deem proper. § 19. The capital stock of any such company must be ^j^p"*' at least five hundred thousand dollars, provided, however, 338 Banking Laws of the that trust compaDies with a capital of not less than two hundred thousand dollars may be organized in any city, the population of which does not exceed one hundred thousand inhabitants. The capital stock of a trust com- How pany may be increased from time to time, by a vote of increased, r j j ■> j two-thirds of the stockholders of said company, in num- ber and amount, to a sum not exceeding two million dol- lars, such capital stock shall be divided into shares of one hundred dollars each, which shares shall be deemed per- sonal property and shall be transferable in such manner as shall be prescribed by the by-laws of said company. Capital ts 20. The capital shall be invested in bonds and mort- how in- " ^ vested. gages on unincumbered real estate in the State of New York, worth at least double the amount loaned thereon, or in the stocks of this State or of the United States, or in the stocks or bonds of incorporated cities or counties of tliis State duly authorized to be issued. Power of 8 21. All trust companies organized under this act are trust com- -l o panies. hereby declared to be corporations possessed of the pow- ers and functions of corporations generally, and as such shall have power : To con- 1. To make contracts. tract. To sue and 2. To sue and be sued, complain and defend, in any be sued. ' r ) j court as fully as natural persons. Iscl? ^ ^- ^^ ^^'^ ^ *^® fiscal or transfer agent of any State, *^^° ■ municipality, body politic or corporation ; and in such capacity to receive and disburse money, and transfer, register and countersign certificates of stock, bonds or other evidences of indebtedness, dep™ to™ ^- To receive deposits of trust moneys, securities and other personal property from any person or corporation, and to loan money on real or personal securities. State of New York. 239 5. To lease, purchase, bold and convey any and ^11^°^^°'^^^ real estate necessary in the transaction of its business, or which the purposes of the corporation may require, or which it shall acquire in satisfaction or partial satisfaction of debts due the corporation under sales, judgments or mortgages, or in settlement or partial settlement of debts due the corporation by any of its debtors. 6. To act as trustee under any mortgage or bond To act as ■^ o o trustee issued by any municipality, body politic or corporation, mortgage, etc. and accept and execute any other municipal or corporate trust not inconsistent with the laws of this State. 7. To accept trusts from and execute trusts for married g°(,|^rugtg women, in respect to their separate property, whether ried wol men. real or personal, and to be their agent in the manage- ment of such property, or to transact any business in relation thereto. 8. To act under the order or appointment of any court Guardian or minor, of record as guardian, receiver or trustee of the estate of ^^po^itary, any minor, the annual income of which shall not be less than one hundred dollars, and as depositary of any moneys paid into court, whether for the benefit of any such minor or any other person, corporation or party. 9. To take, accept and execute any and all such legal Mauage- ' ^ •> o mentof trusts, duties and powers in regard to the holding, man- r|n^*®' ,,...» , etc. agement and disposition oi any estate or property, real or personal, and the rents and profits thereof, or the sale thereof, as may be granted or confided to it by the su- preme court, or by any other court of record, or by any person, corporation, municipality or other authority ; and the said corporation shall be accountable to all parties in interest for the faithful discharge of every such trust, duty or power which it may so accept. 5^40 Banking Laws of the ti'usts^^^' 10. To take, accept and execute any and all sucli courts, trusts and powers of whatever nature or description as coi-pora- g(°°^' may be conferred upon or intrusted or committed toeaid company by any person or persons, or any body politic, corporation or other authority, by grant, assignment, transfer, devise, bequest or otherwise or which may be intrusted or committed or transferred to or vested in said company by order of the supreme court, or any court of record, or any surrogate, and to receive and take and hold any property or estate, real or personal, which may be subject to any such trust. To invest H. To purchase, invest in, and sell stocks, bills of ex- m stocks. JT ? 7 7 cliange, bonds and mortgages and other securities ; and when moneys, or securities for moneys, are borrowed or received on deposit, or for investment, the bonds or obligations of the company may be given therefor, but Not to nothing herein contained shall be construed as giving the issue ° t) & bii°s.^^ right to issue bills to circulate as money. To act as 12. To be appointed and to accept the appointment executor ^^ ^ ^^ miMee'.' of executor of or trustee under the last will and testa- ment, or administrator with or without the will annexed of the estate of any deceased person, and to be appointed and to act as tlie committee of the estates of lunatics,^ idiots, persons of unsound mind and habitual drunkards. Letters 8 22. Whenever application shall be made to any court testamen- ° '^'^ •' to'^^'su?™ of this State, or to a surrogate of any county of this pany. State, for letters testamentary on any last will or testa- ment, by the terms of which said company is appointed executor thereof, the said court or surrogate shall grant letters testamentary thereon to said company. Whenever application shall be duly made to any court of this State, or admfnis- to ^uy such Surrogate for letters of administration upon the State op New York. 241 estate of any deceased person, with or without the will surrogate's 1 1 • 1 n 11- • PO'fflrs as annexed, and it shall appear that there is no person enti- to. tied to such letters who is qualified, competent, willing and able to accept such administration, said court or sur- rogate may, at the request of any party interested in the estate, whether as creditor or beneficiary, grant letters of administration on said estate to said company. § 23. In all cases where an application shall be made to gi'fjjf 'n? any court of this State, or to the surrogate of any county mly'ip-^ of this State, having jurisdiction for the appointment of a guardian of any infant, the annual income of whose es- tate shall exceed the sum of one hundred dollars, the said court shall have power to appoint, and the said surrogate, on the application of the minor, if of the age of fourteen years or upwards, and on the application of the freinds* of the minor, if under the age of fourteen years (as now provided by law), shall have power to appoint the said company as guardian of the estate of such infant. Every Moneys ^ "^ ° '' paid into court into which moneys may be paid by parties, or be posi?'with brought by order or judgment, may, by order, direct the same to be deposited with the said company. 8 2i. On any sum of money not less than one hundred interest " -^ ■' upon trust dollars which shall be collected and received by the said *'""'^- company in its capacity of guardian, receiver or deposi- tary of moneys in court, an interest shall be allowed by said company of not less than the rate of two per centum annually, which interest shall continue until the money so received shall be duly expended or distributed. S 25. Where the annual income of an infant of whose Accumu- " lation of estate the said company shall be a guardian shall exceed infant^ °* estates. the sum allowed or which may be sufficient for the educa- * So in the original. 31 242 Banking Laws of the tion and support of such infant, such surplus income may be accumulated by the company for the benefit of such infant, by adding interest on the whole as a new prinui- interest. pa] ; and the interest so to be allowed and added in such accumulation shall in no case be less than two per cent. SToboDd 8 26. No bond or other collateral security shall be re- or security " _ ** wj^ei'/oom- quired from the company for or in respect to any trust, pany acts as guard- nor when appointed guardian, receiver, depositary or ex- utor, etc. gg^^jQj. Qj. administrator, with or without the will an- nexed, or such committee as aforesaid, but all invest- ments of moneys received by the said company in either of such characters, shall be at the sole risk of the said Liability of corporation ; and for all losses of such money the capital stock. stock, property and eSects of the said corporation shall be absolutely liable ; and in case of dissolution of the said company by the Legislature, the supreme court, or other- wise, the debts due from the company, as guardian, re- ceiver or depositary of money in court, or as executor or administrator, with or without the will annexed, or as such committee as aforesaid, shall have a preference. Surrogate The surroffate of any county wherein the said company may make a J J ir J speotfn™' shall be appointed guardian, or executor or administrator, trusts. with or without the will annexed, shall have power to make orders respecting such trusts, and to require the said company to render all accounts which such surrogate might lawfully make or require if such guardian or ex- ecutor or administrator, with or without the will annexed, were a natural person. Invest- § 27. The trustees shall have a discretionary power of State "'^ investing the moneys received by them in trust, in public etc. ' stocks of the United States, or of any individual State, or in the bonds or stocks of any incorporated city or State of New York. 243 county of the State, duly authorized to be issued, or in such real and personal securities as they may deem proper; but no trust company shall hold stock in any private in- stock in ^ -J 'J i other com- corporated company beyond twenty thousand dollars. "*" ®^' § 28. No loan shall be made by any trust company, di-^^^nato rectly or indirectly, to any trustee or officer thereof. § 29. Whenever default shall be made in the payment J^g!,^'^'J»i of any debt or liability contracted by any corporation nr-ersinoase _ "^ •' .1 J r ^jf default. ganized under this act, the stockholders thereof shall be individually responsible, equally and ratably, for the amount of such liability with interest, to an extent equal to the amount of their respective shares of stock in said corporation; but no person holding stock therein as lability of executor, administrator, trustee, receiver, guardian orJ™|jy|J^_ etc. committee, and no person holding such stock as collateral security, shall be personally liable as a stockholder in said company, but the estate and funds in the hands of such executor, administrator, trustee, receiver, guardian or committee shall be liable in like manner and to the same extent as the testator or intestate or the ward or person interested in such trust fund would have been if living and competent to act and hold the stock in his own name ; and the person pledging such stock shall be deemed a stockholder and liable under this section. § 30. For all losses of money which the capital stock Responsi- shall not be sufficient to satisfy the trustees shall be re- torfottls. sponsible, in the same manner and to the same extent that trustees are now responsible in law or equity. 8 31. It shall be lawful for the trustees of any trust dumber of " •' trustees, company, by a resolution to be incorporated in their by- of. '"'"°'' laws, a copy of which shall also be filed with the Super- intendent of the Banking Department, to reduce the 344 Bakkikg Laws of the number of trustees named in the original charter of such corporation, to a number not less than the minimum named in this act, such reduction to be efEected gradually by the occurrence of vacancies by death, resignation or forfeiture, until the number is reduced to thirteen, or to such greater number as shall be designated in the afore- increaaeof said resolution ; or the number of trustees may be in- truatees. creased to any number designated in a resolution for that purpose, where reasons therefor are shown to the satisfac- tion of the superintendent, and his consent in writing obtained thereto. Semi-an- R 32. It shall be the duty of the trustees of every trust books and Company, by a committee of not less than three of such assets. 1 _£. 1 J? T trustees, on or about the first days of January and July in each year, to thoroughly examine the books, voiichers and assets of such trust company and its aiiairs generally ; Reports to and the statement or schedule of assets reported to the ^"^'' Superintendent of the Banking Department for the first days of January and July in each year shall be based other upon sucli examination ; but nothing herein contained examina- Mods. gj^g^]} j^g construed as prohibiting the trustees of any trust company from requiring such examination at such other times as they shall prescribe. ments of § ^^' '^^® Statement of assets hereinbefore provided verifle'd. for shall be verified by the oath of a majority of the trustees who examined the same pursuant to the preced- Faise ixicr section of this act; and any willful false swearing in swearing, '^ > ,/ o i8hed^"° regard thereto, or in regard to any report made to the Superintendent of the Banking Department pursuant to law, shall be deemed perjury and be subject to the prose- cutions and punishment prescribed by law for that offense. State of New York. 24:5 § 34. Whenever two-thirds maiority of all the trustees change of f .1 J name, pro- of any such corporation shall, by a resolution to be for. '"^ entered upon their minutes, express a desire and purpose to change the name of such corporation, the same may be effected in the manner following, to wit : Notice of intention to apply to the Superintendent of the Banking Department for leave to change the name of such corpora- tion, specifying the name thereof, and the name to which it is proposed to change the same, shall be published as required in section four of this act. After such publica- tion application may be made to the Superintendent to change the name of such corporation to such name as has been agreed upon in such resolution, and published in such notice, evidence of which resolution and publi- cation must be made satisfactorily to the Superin- tendent, together with such application. If it shall E^^jfi"* appear to the Superintendent that it is expedient ent'to^"'^ order and proper that such change of names be made he^hange, shall, by an order under his hand and seal of office "°^"°°' direct and authorize such change of corporate name to be made, and designate some day in the future, not to exceed thirty days from the date of such order, when the said change shall take effect. Such order shall be executed in Order, how ° filed. triplicate; one copy shall be transmitted and filed in the office of the county clerk of the county in which such corporation is located ; one copy shall be transmitted to the corporation affected thereby, and one copy shall be filed in the office of the Superintendent of the Banking Department. Thereupon from the date designated in change' such order for such change of name to take effect, such corporation shall be known and described by the name designated in such order, and by such name shall have all 346 Banking Law^ of the the rights and powers to which it would be entitled if such change had not been made; but no such change shall in any manner lessen or impair any liability of such corporation incurred or existing at the time such change of name shall be made. and wusts § ^^- '^^^^^ ^^^ ^^^^^ "°^ ^^ construcd to confer on such constrao-' association any right or power to make any contract or to lion of. accept or execute any trust whatever, which it would not be lawful for any individual, under the general rules of law which are or shall be in force, to make, accept or exe- cute ; and the Legislature shall have the power at any time hereafter to repeal, alter or modify this act or any of its provisions. Act a § 36. This act, so far as it relates to trust companies, is hereby declared to be a public act, and shall be construed favorably for every beneficial purpose therein contained. Words § 37. The words " trust company " as used in this act deflned"7 shall include all trust, loan, mortgage, security, guarantee and indemnity companies or associations which may in any way receive moneys on deposit, but they shall not apply to banks of deposit and discount, nor to savings appw°to'° iiistitutions. It is further provided that nothing in this oorporf- act shall apply to any trust company heretofore chartered, by special acts of the Legislature and now existing. § 38. This act shall take effect immediately. State of New York. 347 CHAP. 165. AN ACT TO COMPEL TEANSrEB, AGENTS OP POE- EIGN COEPOEATIONS TO EXHIBIT A LIST OP THE STOCKHOLDEES THEEEOP. Passed April 11, 1842. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. The transfer agent in this state of any Duties of o •/ agents. moneyed or other corporation existing beyond the juris- diction of this state (whether such agent shall be a cor- poration or a natural person) shall at all reasonable times during the usual hours of transacting business, exhibit to any stockholder of such foreign corporation, when required by him, the transfer book of such foreign cor- poration, and also a list of the stockholders thereof (if in their power so to do). § 2. In case such transfer agent or any clerk or officer Penalty, of such agent should refuse to exhibit such transfer book, or a list of the stockholders of such foreign corporation as aforesaid, he shall for every such offence forfeit the sum of two hundred and fifty dollars, to be recovered by the person to whom such refusal was made. 348 Banking Laws of the CHAP. 158. AN ACT EXTENDING TO CORPORATIONS LOCATED IN AND ORGANIZED UNDER THE LAWS OP OTHER STATES, CERTAIN RIGHTS AND POWERS NOW POSSESSED BY SIMILAR CORPORATIONS OF THIS STATE. Passed April 17, 1877. The People of the State of New York, represented in Senate and Assembly, do enact as follows: Foreign SECTION 1. It shall be lawful for anj corporation, duly purchase'' organized under the laws of any state in which such cor- lands in u'pon^fore- poration shall be located, to purchase under any fore- closure 1 1 I, J i. 1. sales, etc., closure Sale based upon any mortgage or mortgages for debts ration"^''°" •^"^'^^d by such Corporation, or upon judgments or de- crees obtained or rendered for debts due to it, or in any settlement effected to secure such debts, any of the lands lying within this state that may be covered by or sub- ject to such mortgages, judgments, decrees or settlements, and also to hold for a term not exceeding five years from of san5°^ the date of such purchase, and to convej' such lands by deed or otherwise, in the same manner as though such corporation had been organized under the laws of and located within this state. § 2. This act shall take effect immediately. State of New Yoke. 349 CHAP. 311. AM" ACT IN RELATION TO CORPORATIONS OR JOINT-STOCK COMPANIES OP OTHER STATES, TERRITORIES, OR DOMINION OP CANADA. Passed May 22, 1877. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Section 1. Whenever, by the laws of any other state co/por^ or territory, or the dominion of Canada, a copy of thedenceof" formation, certificate of organization or incorporation or any other **"■' °'' certificate, certified or exemplified by any ofiicer or officers in such state or territory or dominion, is or shall be prima facie evidence of the due formation, creation, existence, organization or capacity of any corporation or joint-stock company, created, organized or located in such state, territory or dominion, or claiming so to be, such certificate or certificates, duly exemplified, or a duly exemplified copy thereof, shall be received in all actions and proceedings in this state, in or before all courts and ofiicers, with the same force and efl'ect in all respects as prima facie evidence as aforesaid, as in such other state, territory or dominion. CHAP. 378. AN ACT IN RELATION TO RECEIVERS OP COR- PORATIONS. Passed April 11,1883; tliree-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows: Section 1. Every application hereafter made for the h^d'/otIp- • and other shall be designated from among the number of the trus- officers, tees, and also such subordinate ofiBcers as the corporation, by its by-laws, may designate, who may be elected or ap- pointed, and required to give such security for the faithful performance of the duties of their offices, as the corpora- tion by its by-laws may require. 8 6. It shall be lawful for the trustees to call in and de- Payment " of stock, mand from the stockholders, respectively, all such sums of trustees money by them subscribed, at such times and in such pay- mand. ments or installments as the trustees shall deem proper, under the penalty of forfeiture of the shares of stock sub- Forfeiture. 382 Laws Rblatikg to scribed for and all previous payments made thereon, if pay- ment shall not be made by the stockholders within sixty days after a personal demand of the same, or notice requir- Notice. ing such payment shall have been published for six succes- sive weeks in a newspaper printed in the city or town in which the business of the corporation shall be carried on as aforesaid, and a copy thereof mailed, postage prepaid to the last known place of residence. In case such demand shall have been made by publication, the sixty days shall commence to run from the last day of publication. By-laws. § 7. The trustees of such corporation shall have power to make such by-laws as they shall deem proper for the management, disposition of the stock, property and busi- ness affairs of such company, not inconsistent with the laws of this State and of the United States, and prescribing the duties of ofBcers and servants that may be employed, the manner of the appointment and election of all oflBcers, and for carrying on all kinds of business within the objects and purposes of said corporation, stock to be § 8. The stock of such corporation shall be deemed personal personal estate, and shall be transferable in such manner howtrang- as shall be prescribed by the by-laws of the corporation; but no shares shall be transferable until all previous calls thereon shall have been fully paid in, or shall have been declared forfeited for the non-payment of calls thereon; and it shall not be lawful for such corporation to use any of its funds in the purchase of any stock in any other cor- poration, or to hold the same, except as collateral security to a prior indebtedness. Personal § 9. The stockholders of any corporation organized stookhoid- under the provisions of this act shall be jointly and severally liable for all debts that may be due and owing by said corporation, to an amount equal to the par value of their stock in said corporation over and above such stock, to be recovered of the stockholders who are such when the debt is contracted or the loss or damage sustained, or of any subsequent stockholder; and any stockholder who may "<»>• have paid any demand against such company, either volun- tarily or by compulsion, shall have a right to resort to the rest of the stockholders who are liable to contribution. Safe Deposit Companies. 383 And the dissolution of such corporation shall not release or affect the liability of any stockholder which may have been incurred before such dissolution. § 10. Every corporation organized under the proyisions semi-an- of this act, and every corporation heretofore organized ?">•' to '*'-*■ ^ superin- under the laws of this State, for purposes similar to those tendent oi provided for in this act, shall semi-annually make a full depan- report in writing of the affairs and conditions of such cor- poration at the close of business, on the last business days of June and December in each year, to the Superintendent of the Banking Department, verified by oath, in such form and by such officers of the said corporation as the said Superintendent may designate, which report shall be in place of any report which any such corporation may now be required to make to the Supreme Court, the Comptroller, or otherwise. Every such report shall be made within ^^°^'j,' twenty days after the day to which it relates, and shall be ^^"'lofm in such form, and contain such statements, returns and"*- information as to the affairs, business, condition and resources of such corporation, as the said Superintendent may, from time to time, prescribe or require. And the said Superintendent may, if he be of opinion that it is desirable, require that a like report either wholly or inSuperin- part, as to the particulars aforesaid, be made to him at any may re- * ■*■ *' quire re- time, by any such corporation aforesaid, within such period port at any as he may designate. § 11. The said Superintendent may, at any time, if he ^"Pf"'!" deem it to be expedient, cause any such statement, or any may pu*"- statement or report which may be made to him under the provisions of this act, or any part or any abstract thereof, to be published in the State paper for at least three times, the expense of which shall be paid by the corporation to whose affairs such report may relate. § 13. It shall be the duty of the said Superintendent visitation yearly, either personally, or by some competent person or ination. persons, to be appointed by him, to visit and examine every corporation required by this act to report as afore- said. The said Superintendent, and every such examiner, shall have power to administer an oath to any person whose testimony may be required on any such examination, and 284 Laws Eelating to Atteod- to compel the appearance and attendance of any such per- witnesses son for the purpose of such examination, by summons, peiied. " subpcena or attachment, in the manner now authorized in respect to the attendance of persons as witnesses in the Produo- courts of record of this State; and all books and pajjers books and which it may be necessary to examine by the Superin- tendent, or the examiner or examiners, so appointed, shall be produced, and their production may be compelled in the Expense, like manner. The expense of every such examination shall be paid by the corporation examined, to such amount as the Superintendent shall determine, siibject to an appeal to the Comptroller whose decision in the matter shall be final. Appeal. Whenever such examination shall be made by the Superin- tendent personally, or by one or more of the regular clerks in his department, no charge shall be made on such exami- nation, but for necessary traveling and other actual ex- penses. Subject of § 13- On every such examination, inquiry shall be made Inquiry. ^^ ^^ ^j^g Condition and resources of the corporation generally, the mode of conducting and managing its affairs, the action of its directors or trustees, the invest- ment of its funds, the safety and prudence of its manage- ment, the security afforded to those by whom its engage- ments are held, and whether the requirements of its charter and of law have been complied with, in the admin- istration of its affairs. Order by § ^^- ^^ ^* shall appear to the said Superintendent, from tendent as ^^J examination made by him, or from the report of any practices, examination made to him, that any corporation has com- *"'• mitted a violation of its charter or of law, or is conducting business in an unsafe or unauthorized manner, he shall, by an order under his hand and seal of office addressed to such corporation, direct the discontinuance of such illegal or unsafe practices, and conformity with the requirements of its charter and of law, and with safety and security in its Refusal to transactions, and whenever any corporation shall refuse or comply" neglect to make such report as is hereinbefore required, or with order. ^^ comply with any such order as aforesaid ; or whenever it shall appear to the Superintendent, that it is unsafe or inexpedient for any corporation to continue to transact Sabb Deposit CoMPAisriES. 385 business, he shall communicate the facts to the Attorney- Attorney- General, who shall thereupon be authorized to institute such proceedings against any such corporations as are now, or may hereafter be provided for by laws in the case of insol- vent corporations, or such other proceedings as the nature of the case may require. § 15. When the amount due for the use of any safe or Remedy of box in the vaults of any such corporation shall not have tion when been paid for three years such corporation may, at the safe re- expiration of such three years, cause to be sent to the per- paid for ' son or persons in whose name or names such safe or box yoMs. stands iipon the books of such corporation, a notice in writing, contained in a securely closed postpaid registered letter directed to such person or persons at his or their re- spective post-office address or addresses as recorded upon the books of such corporation, notifying such person or persons that if the amount then due for the use of such safe or box is not paid within sixty days from the date of sixty days' . notice, such notice, that such corporation will then cause such what to contain. safe or box to be opened in the presence of the president or secretary or treasurer of such corporation and of a notary public, not an officer or in the employ of such cor- poration, and the contents thereof, if any, to be sealed up by such notary public in a package, upon which such notary public shall distinctly mark the names and addresses of the person or persons in whose name or names such safe or box stands upon the books of such corporation and the estimated value thereof and the package so sealed and ad- dressed, when marked for identification by such notary public, will be placed by such notary public in one of the general safes or boxes of such corporation. Upon thepj.gpgg|j expiration of sixty days from the date of mailing such ^"e^ ?<"• notice as aforesaid, and the failure of the person or persons safe or in whose name or names such safe or box stands upon the books of such corporation to pay the amount due for the use of such safe or box in full up to the date of such notice, then such corporation may, in the presence of a notary public and of the president or secretary or treasurer of such corporation, cause such safe or box to be opened, and the contents thereof, if any, to be removed and sealed up by 286 Laws Eelating to such notary public, in a package upon which such notary public shall distinctly mark the name or names and ad- dress or addresses of the person or persons in whose name or names such safe or box and its estimated value stood on the books of such corporation, and when such package has been marked for identification by such notary public, it shall, in the presence of the president or secretary or treas- Duty of urer of such corporation, be placed by such notary public in one of the general safes or boxes of such corporation, and the proceedings of such notary public shall be fully set out by him in his own proper handwriting and under his official seal, in a book to be kept by such corporation for that purpose. (As amended by chapter 498, Laws of 1886.) CHAP. 336. AN ACT TO ENABLE STORAGE WAREHOUSEMEN TO COLLECT THEIR CHARGES UPON GOODS DE- POSITED WITH THEM BY THE SALE THEREOF. Passed May 19, 1879. The People of the State of New York, represented in Senate and Assembly, do enact as follows : When Section' "l. Every warehouse company or person or per- be sold, sons engaged in the warehouse business who shall have had in his or their possession any goods, wares or merchandise by virtue of any agreement or warehouse receipt for the storage of the same, on which or any part thereof there may be due one year's storage, may proceed to sell the same Proceeds, at public auction, and out of the proceeds may retain the disposed charges for storage of said goods, wares and merchandise, and any advances that may have been made thereon by him or them, and the expense of advertising and sale thereof, but no such sale shall be made until after the giving of a printed or written notice of such sale to the person or per- sons in whose name or names such goods, wares and mer- chandise were stored, requiring him, her or them, naming Safe Deposit Companies. 287 them, to pay the arrears or amount due for such storage, and in case of default in so doing, that such goods, -wares and merchandise ■will he sold to pay the same, at a time and place to be specified in such notice. (As amended by chapter 431, Laws of 1883.) § 3. The notice required by the last preceding section Notice, shall be served personally, at least four weeks before the served, time of such sale upon the party storing the goods, pro- vided such service can be made with reasonable diligence within the State of New York. If the party storing such goods cannot with reasonable diligence be found within the State of New York, then such notice shall be given by publication once in each week for six successive weeks, be- fore the time of such sale in a newspaper published at or nearest the place, where such sale is to take place. In the event that the party storing such goods or merchandise shall have parted with the same, and the purchaser shall have notified the warehouseman with his address, such no- tice shall be given to such person in lieu of the person stor- ing the goods. § 3. Such warehouse company, or person or persons, en- Surplus of sraged in the warehouse business, shall make an entrv in a of sale, ° ° " disposition book kept for that purpose of the balance or surplus of the of. proceeds of the sale, if any, and such balance or surplus shall be paid over to such person or persons entitled thereto within thirty days after such sale and after the expiration of said thirty days such balance or surplus shall be paid by such warehouse company, or person or persons, engaged in the warehouse business to the county treasurer ; or if in the city of New York to the chamberlain of said city, for the use of the poor, unless called for or claimed by the rightful owner within five years after the receipt thereof, and shall at the same time file with said treasurer or cham- berlain an affidavit in which shall be stated the name and place of residence, so far as the same are known, of the person whose goods or merchandise have been sold, the articles sold and the prices at which they were sold, the name and residence of the auctioneer making the sale, together with a copy of the notice published and how 288 Laws Eblating to Safe Deposit Go's. served, whether by personal service or by mailing, and if not so served the reason therefor. § 4. This act shall take effect immediately. CHAP. 526. AN ACT TO ESTABLISH AND DEFINE THE LIEN OP WABEHOUSEMEN. Passed June 13, 1885; three-fifths being present. The People of the State of New York, represented in Senate and Asserribly, do enact as follows : Ware- Sectiok 1. A warehouseman or person lawfully engaged houBemaD i • i • j.t i • jt i^ • -i -i to have exclusively in the business of storing goods, wares and mer- storage chandisc for hire shall have a lien for his storage charges, charges, ^^^ moneys advanced by him for cartage, labor, weighing and coopering paid on goods deposited and stored with him, and such lien shall extend to and include all legal demands for storage and said above-described expenses paid which he may have against the owner of said goods ; and it shall be lawful for him to detain said goods until such lien is paid. § 2. This act shall take effect immediately. PROVISIONS CONSTITUTION OF THE STATE OF NEW YORK; RE- VISED STATUTES OF THE STATE OF NEW YORK; CODE OF CIVIL PROCEDURE; CODE OF CRIM- INAL PROCEDURE, AND THE PENAL CODE, WHICH ARE APPLICABLE TO CORPORATIONS. 37 EXTEACTS FROM THE CONSTITUTIOW OF THE STATE OP NEW YORK. Sectiok 1. Corporations may be formed under general laws; but shall not be created by special act, except for municipal purposes, and in cases where, in the judgment of the Legislature, the objects of the corporation cannot be attained under general laws. All general laws and spe- cial acts, passed pursuant to this section, may be altered from time to time, or repealed. Article VIII, Constitution State of New York. § 2. Dues from corporations shall be secured by such individual liability of the corporators and other means as may be prescribed by law. Article VIII, Constitution State of New York. § 3. The term corporations as used in this article shall "be construed to include all associations and joint-stock companies having any of the powers or privileges of cor- porations not possessed by individuals or partnerships. And all corporations shall have the right to sue and shall be subject to be sued in all courts in like cases as natural persons. Article VIII, Constitution State of New York. § i. The Legislature shall, by general law, conform all charters of savings banks, or institutions for savings, to a uniformity of powers, rights and liabilities, and all chart- ers hereafter granted for such corporations shall be made to conform to such general law, and to such amendments as may be made thereto. And no such corporation shall have any capital stock, nor shall the trustees thereof, or any of them, have any interest whatever, direct or indi- 392 COKSTITUTION OF THE rect. in the profits of such corporation; and no director or trustee of any such bank or institution shall be interested in any loan or use of any money or property of such bank or institution for savings. The Legislature shall have no power to pass any act granting any special charter for banking purposes; but corporations or associations may be formed for such purposes under general laws. Article VIII, Constitution State of New Tork, as amended by rote of the people, November 8, 1874. § 5. The Legislature shall have no power to pass any law sanctioning in any manner, directly or indirectly, the sus- pension of specie payments, by any person, association or corporation issuing bank notes of any description. Article VIII, Constitution State of New York. § 6. The Legislature shall provide by law for the registry of all bills or notes, issued or put in circulation as money, and shall requirs ample security for the redemption of the same in specie. Article VIII, Constitution State of New York. § 7. The stockholders in every corporation and joint- stock association for banking purposes issuing bank notes or any kind of paper credits to circulate as money, after the first day of January, one thousand eight hundred and fifty, shall be individually responsible to the amount of their respective share or shares of stock in any such cor- poration or association, for all its debts and liabilities of every kind, contracted after the said first day of January, one thousand eight hundred and fifty. Article VIII, Constitution State of New York. § 8. In case of the insolvency of any bank or banking association, the billholders thereof shall be entitled to pre- ference, in payment, over all other creditors of such bank or association. Article VIII, Constitution State of New York. § 10. Neither the credit nor the money of the State shall be given or loaned to or in aid of any association, corporation or private undertaking. This section shall State of New Yoek. 393 not, however, prevent the Legislature from making such provision for the education and support of the blind, the deaf and dumb, and juvenile delinquents, as to it may seem proper. Nor shall it apply to any fund or property now held, or which may hereafter be held, by the State for edu- cational purposes. Article VIII, Constitution State of New York, added by ». vote of the people November 3, 1871. § 11. No county, city, town or village shall hereafter give any money or property, or loan its money or credit to or in aid of any individual, association or corporation, or become directly or indirectly the owner of stock in, or bonds of, any association or corporation; nor shall any such county, city, town or village be allowed to incur any indebtedness except for county, city, town or village pur- poses. This section shall not prevent such county, city, town or village from making such provision for the aid or support of its poor as may be authorized by law. No county containing a city of over one hundred thousand inhabitants, or any such ciby, shall be allowed to become indebted for any purpose or in any manner to an amount which, including existing indebtedness, shall exceed ten per centum of the assessed valuation of the real estate of such county or city subject to taxation, as it appeared by the assessment-rolls of said county or city on the last assessment for State or county taxes prior to the incurring of such indebtedness; and all indebtedness in excess of such limitation, except such as may now exist, shall be abso- lutely void, except as herein otherwise provided. No such county or such city whose present indebtedness exceeds ten per centum of the assessed valuation of its real estate sub- ject to taxation shall be allowed to become indebted in any further amount until such indebtedness shall be reduced within such limit. This section shall not be construed to prevent the issuing of certificates of indebtedness or revenue bonds issued in anticipation of the collection of taxes for amounts actually contained, or to be contained in the taxes for the year when such certificates or revenue bonds are issued and payable out of such taxes. Nor shall this section be construed to prevent the issue of bonds to provide for 394 Ketised Statutes of the the supply of water, but the term of the bonds issued to provide for the supply of water shall not exceed twenty years, and a sinking fund shall be created on the issuing of the said bonds for their redemption, by raising annually a sum which will produce an amount equal to the sum of the principal and interest of said bonds at their maturity. The amount hereafter to be raised by tax for county or city purposes, in a county containing a city of over one hundred thousand inhabitants, or any such city of this State, in ad- dition to providing for the principal and interest of existing debt, shall not in the aggregate exceed in any one year two per centum of the assessed valuation of the real and per- sonal estate of such county or city, to be ascertained as pre- scribed in this section in respect to county or city debt. Article VIII, Constitution State of New York, added by a vote of the people November 3, 1874; and amended by a vote of the people November 4, 1884. PEOVTSIONS OF THE REVISED STATUTES Or THE STATE OP NEW YOBK, APPLICABLE TO COEPO- EATIONS. Section 1. Every corporation, as such, has power. General 1. To have succession by its corporate name, for the powers. ./A period limited in its charter; and when no period is limited perpetually: 3. To sue and be sued, complain and defend, in any court of law or equity: 3. To make and use a common seal, and alter the same at pleasure: 4. To hold, purchase, and convey such real and personal estate, as the purposes of the corporation shall require, not exceeding the amount limited in its charter: 5. To appoint such subordinate of&cers and agents, as the business of the corporation shall require, and to allow them a suitable compensation: 6. To make by-laws, not inconsistent with any existing law, for the management of its property, the regulation of its affairs, and for the transfer of its stock. Part I, Chapter XVIII, Title III, Revised Statutes. State of Kew York. 295 §2. The powers enumerated in the preceding section, in what shall vest in every corporation that shall hereafter betionsto created, although they may not be specified in its charter or in the act under which it shall be incorporated. Part I, Chapter XVIII, Title III, Revised Statutes. § 3. In addition to the powers enumerated in the first what section of this title, and to those expressiy given in its powers to charter, or in the act under which it is or shall be incorpo- sessed. rated, no corporation shall possess or exercise any corporate powers, except such as shall be necessary to the exercise of the powers so enumerated and given. Part I, Chapter XVIII, Title III, Revised Statutes. § 4. No corporation created, or to be created, and not Exercise of expressly incorporated for banking purposes, shall by any powers implication or construction, be deemed to possess the power of discounting bills, notes, or other evidences of debt, of receiving deposits, of buying gold and silver, bullion, or foreign coins, of buying and selling bills of ex- change, or issuing bills, notes, or other evidences of debt, upon loan, or for circulation as money. Part I, Chapter XVIII, Title III, Revised Statutes. § 5. Where the whole capital of a corporation shall not Liability have been paid in, and the capital paid, shall be insuffi- hofders^" eient to satisfy the claims of its creditors, each stockholder shall be bound to pay on each share held by him, the sum necessary to complete the amount of such share, as fixed by the charter of the company, or such proportion of that sum as shall be required to satisfy the debts of the company. Part I, Chapter XVIII, Title III, Reused Statutes. § 6. When the corporate powers of any corporation are di- Quorum, rected by its charter to be exercised by any particular body, or number of persons, a majority of such body, or persons, if it be not otherwise provided in the charter, shall be a sufficient number to form a board for the transaction of business ; and every decision of a majority of the persons duly assembled as a board, shall be valid as a corporate act. Part I, Chapter XVIII, Title III, Revised Statutes. 296 Eevised Statutes of the Forfeiture § 7. If any corporation hereafter created by the legisla- user. ture, shall not orsanize and commence the transaction of its business within one year from the date of its incorporation, its corporate powers shall cease. Part I, Chapter XTIII, Title III, Revised Statutes. Eeserva- § 8. The charter of every corporation, that shall hereafter power to be granted by the legislature, shall be subject to alteration, suspension and repeal, in the discretion of the legislature. Part I, Chapter XVIII, Title III, Revised Statutes. Trustees R 9. Upon the dissolution of any corporation created or in case of ° ■'^ j r dissoiu- to be created, and unless other persons shall be appointed by the legislature, or by some court of competent authority, the directors or managers of the affairs of such corporation at the time of its dissolution, by whatever name they may be known in law, shall be the trustees of the creditors and stockholders of the corporation dissolved, and shall have full power to settle the affairs of the corporation, collect and pay the outstanding debts, and divide among the stock- holders the monies and other property that shall remain after the payment of debts and necessary expenses. Part I, Chapter XVIII, Title III, Revised Statutes. § 10. The persons so constituted trustees, shall have au- thority to sue for and recover, the debts and property of the dissolved corporation, by the name of the trustees of sucli corporation, describing it by its corporate name, and shall be jointly and severally responsible to the creditors and stockholders of such corporation, to the extent of its property and effects that shall come into their hands. Part I, Chapter XVIII, Title III, Revised Statutes. Certain SECTioisr 1. The book or books of any incorporated com- be opVn at pany in this state in which the transfer of stock in any time^'.° such company shall be registered, and the books contain- ing the names of the stockholders in any such company, shall, at all reasonable times during the usual hours of transacting business, be open to the examination of every stockholder of such company, for thirty days previ- ous to any election of directors; and if any officer having charge of such books, shall, upon demand by any stock- Their powers. State of New Yobk. 39? holder as aforesaid, refuse or neglect to exhibit such books, or submit them to examination as aforesaid, he shall for every such offence forfeit the sum of two hundred and fifty dollars, the one moiety thereof to the use of the people of this state, and the other moiety to him who will sue for the same, to be recovered by action of debt in any court of record, together with the costs of such suit. Part I, Chapter XVIII, Title IV, KeYised Statutes. § 3. It shall not be lawful for the directors or managers Dividends of. any incorporated company in this state to make divi- p^u^proflts dends, excepting from the surplus profits arising from the °" *' business of such corporation; and it shall not be lawful for the directors of any such company to divide, withdraw. Capital not or in any way pay to the stockholders, or any of them, any ducea. part of the capital stock of such company, or to reduce the said capital stock, without the consent of the legisla- ture; and it shall not be lawful for the directors of such company to discount or receive any note, or other evidence Notes for of debt, in payment of any installment actually called in ments on and required to be paid, or any part thereof, due or to be- tobe'dis- come due on any stock in the said company; nor shall it be lawful for such directors to receive or discount any note, or other evidence of debt, with the intent of enabling any Nor notes stockholder in such company to withdraw any part of the draw in- ■ 1 • 1 T • 1 ■ , 1 ■ . ■ stalments money paid m by him on his stock; and m case of any vio- paid, lation of the provisions of this section, the directors under whose administration the same may have happened, except Liability those who may have caused their dissent therefrom to be ors for vio- entered at large on the minutes of the said directors at the these pro- time, or were not present when the same did happen, shall in their individual and private capacities, jointly and sev- erally be liable to the said corporation, and to the creditors thereof in the event of its dissolution, to the fall amount of the capital stock of the said company so divid'ed, with- drawn, paid out, or reduced, and to the full amount of the notes or other evidences of debt so taken or discounted in payment of any stock, and to the full amount of any notes or evidences of debt so discounted with the intent afore- said, with legal interest on the said respective sums, from 298 Eevised Statutes of the Notbarred the time such liability accrued; and no statute of limita- by statute of limita- tions shall be a bar to any suit at law or in equity, against such directors for any sum for which they are made liable Proviso, by this section: Provided, That this section shall not be construed to prevent a division and distribution of the capi- tal stock of such company which shall remain after the payment of all its di-bts, upon the dissolution of such com- pany, or the expiration of its charter. Part I, Chapter XVIII, Title IV, Eevised Statutes. Amount of debts. § 3. The total amount of the debts which any incorpo- rated company shall at anytime owe,, whether for deposits, or by bond, bill, note, or other contract, over and above the actual deposits with the said company, shall not at any time exceed three times the amount of the capital stock actually paid in, and in case of any excess the directors under whose administration the same may have happened, Liabiiityof except those who may have caused their dissent therefrom for excess, to be entered at large on the minutes of the said directors at the time, and except those who were not present when the same did happen, shall in their individual and private capacities. Jointly and severally, be liable for such excess to the said corporation, and in the event of its dissolution, to any of the creditors thereof, to the full amount of such excess, with legal interest from the time such liability ac- Not barred crued; and no statute of limitations shall be a bar to any of iimita- suit at law or in equity, against such directors for any sums of money for which they are made liable by this sec- tion. Part I, Cliapter XTIII, Title IV, Revised Statutes. Certain transfers of prop- erty pro- hibited. § 4. Whenever any incorporated company shall have refused the payment of any of its notes, or other evidences of debt, in specie, or lawful money of the United States, it shall not be lawful for such company, or any of its officers, to assign or transfer any of the property or choses in action of such company, to any officer or stockholder of such com- pany, directly or indirectly for the payment of any debt ; and it shall not be lawful to make any transfer or assign- ment in contemplation of the insolvency of such company, to any person or persons whatever ; and every such transfer State of New York. 399 and assignment to such officer, stockliolder or other per- son, or in trust for them or their benefit, shall be utterly void. (Repealed by chapter 403, Laws of 1882; restored by chapter 434, Laws of 1884.) Part I, Chapter XVIII, Title IV, Kevised Statutes. § 5. It shall be the duty of the supreme court, upon the powers of application of any person or persons or body corporate, that §ourt re*- may be aggrieved by, or may complain of, any election, or l^ectioSa. any proceeding, act or matter, in or touching the same (reasonable notice having been given to the adverse party, or to those who are not to be affected thereby, of such in- tended application), to proceed forthwith and in a sum- mary way, to hear affidavits, proofs and allegations of the parties, or otherwise inquire into the matters or causes of complaint, and thereupon to establish the election so com- plained of, or to order a new election, or make such order and give such relief in the premises, as right and justice may appear to the said supreme court to require: Provided, that the said supreme court may, if the case shall appear to Prooeed- require it, either order an issue or issues to be made up in such manner and form as the supreme court may direct, in order to try the respective rights of the parties who may claim the same, to the office or offices or franchise in ques- tion ; or may give leave to exhibit, or direct the attorney- general to exhibit, one or more information or informations in the nature of a quo warranto in the premises. Part I, Chapter XVIII, Title IV, Revised Statutes. § 6. No by-law of the directors and managers of any certain by- incorporated company, regulating the election of directors p^JSished. or officers of such company, shall be valid, unless the same shall have been published for at least two weeks in some newspaper in the county where such election shall be held, at least thirty days before such election ; and in all cases where the right of voting upon any share or shares of the stock of any incorporated company of this state, shall be questioned, it shall be the duty of the inspectors of the elections, to require the transfer books of said company, as o7ri|ht"to evidence of stock held in the said company ; and all such ^°*®- shares as may appear standing thereon in the name of any 300 Eevised Statutes of the person or persons, shall be Toted on by such person or per- sons, directly by themselves, or by proxy, subject to the provisions of the act of incorporation. Part I, Chapter XTIII, Title IV, Revised Statutes. Oath of § '''• The inspectors who may be appointed to conduct oielec-"'^ ^'Hy election of directors or any other oflBcer of any incor- '^'°''^' porated company of this state shall be required, before entering on the duties of their appointment, to take or subscribe the following oath or affirmation: "I, A. B., do solemnly swear, (or affirm, as the case may be) that I will execute the duties of an inspector for the election now to be held, with strict impartiality, and according to the best of my ability." Part I, Chapter XVIII, Title IV, Revised Statutes. On failure § 8. If at any time hereafter, the election for directors of another any bank or other incorporated company of this state, shall appdinted. not be duly held on the day designated and appointed by the act incorporating such bank or other incorporated com- pany, it shall be the duty of the president and directors of such bank or other incorporated company, to notify and cause an election for directors to be held within sixty days immediately thereafter; and in all cases, no share or shares entitled to shall be voted upon, except by such person or persons who such sub- may have appeared on the transfer books of said company dajf. to have had the right to vote thereon, on the day when, by the act of incorporation of such company, the election ought to have been held; which said right so to vote shall be exercised by the persons so appearing as aforesaid upon the transfer books of such company, on any day when such election may be held. Part I, Chapter XVIII, Title IV, Revised Statutes. Corpora- § 9. It shall not be lawful in any company incorporated its° ^° for banking purposes, its officers, agents or servants, or any eto."*notto of them, directly or indirectly to purchase or be interested iu notes^ ill the purchase of any promissory note, or other evidence 'couiit!^' of debt, issued by any such company, at a less sum than Penalty, appears by the face thereof to be due and payable; and any person offending against the provisions of this section, shall State ob New Yoke. 301 forfeit and pay three times the nominal amount of the note or other evidence of debt so purchased, to be recovered, with costs of suit, by any person who will sue for the same, in any court of competent jurisdiction. Part I, Chapter XVIII, Titlo IV, Eevised Statutes. § 10. It shall not be lawful for any person being presi- gj^"®^' dent, director, cashier, clerk, agent, or any way interested jj°''Pg°J^^ or concerned in the management of the concerns of any '° 'o^° such company, to discount, or directly or indirectly make **'° notes, any loan upon any note, bill, or other evidence of debt which shall have been ofEered to such directors for discount; and every note, bill, or other evidence of debt so discounted, ^^'^^'®"'-' or upon which any loan shall have been made by any of the persons aforesaid, knowing that such note had been so offered and refused, shall be utterly void; and the person offending herein, knowing that such note had been so Further offered and refused, by making any discount or loan, shall, for every such offence, forfeit and pay to any person who will sue for the same, twice the amount of any such discount or loan, to be recovered by action of debt, with costs of suit, in any court of competent jurisdiction. - Part I, Chapter XTIII, Title IT, Revised Statutes. § 11. The provisions of this title shall not apply to any Appiica- religious society, nor to any moneyed corporation, which title °* '^''•^ shall have been or shall be created, or whose charter shall '"""'^'i- be renewed or extended after the first day of January, one thousand eight hundred and twenty-eight, and which shall be subject to the provisions of the second title of this chap- ter. (As amended by chapter 883, Laws of 1871.) Part I, Chapter XVIII, Title IV, Revised Statutes. PROVISIONS or THE CODE OF CIVIL PEOCEDITBE APPLICABLE TO CORPORATIOITS. § 1775. In an action brought by or against a corporation. Complaint the complaint must aver that the plaintiff, or the defendant, by or against as the case may be, is a corporation; must state whether it oorpora- ... . . tions. is a domestic corporation or a foreign corporation; and, if 302 Code of Civil Pboceduee or the the latter, the state, country, or government, by or under whose laws it was created. But the plaintiff need not set forth, or specially refer to, any act or proceeding, by or under which the corporation was created. Part II, Title II, Article I, Chapter XV, Code of Civil Procedure. When § 1776. In an action, brought by or against a corpora- corporate tion, the plaintiff need not prove, upon the trial, the ex- uimeoes- istence of the corporation, unless the answer is verified, and contains an affirmative allegation that the plaintiff or the defendant, as the case may be, is not a corporation. Part II, Title II, Article I, Chapter XV, Code of Civil Procedure. Misnomer | 1777. In an action or special proceeding, brought by or waived, against a corporation, the defendant is deemed to have waived any mistake in the statement of the corporate name, unless the misnomer is pleaded in the answer, or other pleading in the defendant's behalf. Part II, Title II, Article I, Chapter XV, Code of Civil Procedure. Action § 1778. In an action against a foreign or domestic cor- oo^OTa? poration, to recover damages for the non-payment of a a note, promissory note, or other evidence of debt, for the abso- lute payment of money, upon demand, or at a particular time, an order, extending the time to answer or demur, shall not be granted, except by the court, upon notice to the plaintiff's attorney. In such an action, unless the de- fendant serves, with a copy of his answer or demurrer, a copy of an order of a judge, directing that the issues pre- sented by the pleadings be tried, the plaintiff may take judgment, as in case of default in pleading, at the expira- tion of twenty days after service of a copy of the com- plaint, either personally with the summons, or upon the de- fendant's attorney, pursuant to his demand therefor; or, if the service of the summons was otherwise than per- sonal, at the expiration of twenty days after the service is complete. Part II, Title II, Article I, Chapter XV, Code of Civil Procedure. m.. X §1779. An action mav be maintained bv a foreign cor- Wnen for- " - j o "oration pors-tion, in like manner, and subject to the same regula- may sue. tions, as whcrc the action is brought by a domestic corpo- State of New Yobk. 303 ration, except as otherwise specially prescribed by law. But a foreign corporation cannot maintain an action, founded upon an act, or upon a liability or obligation, ex- press or implied, arising out of, or made and entered into in consideration of, an act, which the laws of the State forbid a corporation ot association of individuals to do, without express authority of law. This section does not affect the validity of a meeting of the stockholders or di- rectors of a foreign corporation, held within the State, where such a meeting is authorized by the laws of the state, country, or government, by or under which the corporation is created; or of an act, done at such a meeting, which is not in conflict with the same laws, or the laws of the State. Part II, Title II, Article I, Chapter XV, Code of Civil Procedure. § 1780. An action against a foreign corporation may be when lor- maintained by a resident of the State, or by a domestic ?ation°ra'ay corporation, for any cause of action. An action against a foreign corporation may be maintained by another foreign corporation, or by a non-resident, in one of the following cases only: 1. "Where the action is brought to recover damages for the breach of a contract, made within the State, or relat- ing to property situated within the State, at the time of the making thereof. 2. "Where it is brought to recover real property situated within the State, or a chattel, which is replevied within the State. 3. Where the cause of action arose within the State, ex- cept where the object of the action is to affect the title to real property situated without the State. Part II, Title II, Article I, Chapter XV, Code of Civil Procedure. § 1781. An action may be maintained against one or . more trustees, directors, managers, or other officers of a l?^'"^'^ corporation, to procure a judgment for the following pur- *'"■' °' " poses, or so much thereof as the case requires: m'isooir 1. Compelling the defendants to account for their official '^"'''■ conduct, in the management and disposition of the funds and property, committed to their charge. 2. Compelling them to pay to the corporation, which -304 Code of Civil Procedueb of the they represent, or to its creditors, any money, and the value of any property, which they have acquired to them- selveSj or transferred to others, or lost, or wasted, by a violation of their duties. 3. Suspending a defendant from exercising his office, where it appears that he has abused his trust. 4. Removing a defendant from his office, upon proof or conviction of misconduct, and directing a new election to be held by the body or board, duly authorized to hold the same, in order to supply the vacancy created by the removal; or, where there is no such body or board, or where all the members thereof are removed, directing the removal to be reported to the governor, who may, with the advice and consent of the senate, fill the vacancies. 5. Setting aside an alienation of property, made by one or more trustees, directors, managers, or other officers of a corporation, contrary to a provision of law, or for a par- pose foreign to the lawful business and objects of the cor- poration, where the alienee knew the purpose of the aliena- tion. 6. Epstraining and preventing such an alienation, where it is threatened, or where there is good reason to apprehend that it will be made. Part II, Title II, Article II, Chapter XV, Code of Civil Procedure. By whom § ^782. An action may be brought, as prescribed in the be'b'rou''ht ^'^'°*' s6°*'io^' ^J ^^^ attorney-general in behalf of the peo- ple of the State ; or, except where the action is brought for the purpose specified in subdivision third or fourth of that section, by a creditor of the corporation, or by a trustee, director, manager, or other officer of the corpora- tion, having a general suj)erintendence of its concerns. Part II, Title II, Article II, Chapter XV, Code of Cinl Procedure. This article § 1783. This article does not divest or impair any visito- ftrued. rial power over a corporation, which is vested by statute in a corporate body, or a public officer. Part II, Title II, Article II, Chapter XT, Code Civil Procedure. j^fde'lSeu^ § 1784. Where final judgment for a sum of money has for seques- been rendered against a corporation created by or under the tratioD, ^^^g q£ ^j^g state, and an execution issued thereupon to the State of New Yoek. 305 sheriff of the county, where the corporation transacts its general business, or where its principal office is located, has been returned wholly or partly unsatisfied, the judgment creditor may maintain an action to procure a Judgment, sequestrating the property of the corporation, and provid- ing for a distribution thereof, as prescribed in section one thousand seyen hundred and ninety-three of this act. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. § 1785. In either of the following cases, an action to pro- Action to . , . , . . dissolve a cure a judgment, dissolving a corporation, created by or oorpora- under the laws of the State, and forfeiting its corporate rights, privileges, and franchises, may be maintained, as prescribed in the next section : 1. Where the corporation has remained insolvent for at least one year. 3. "Where it has neglected or refused, for at least one year, to pay and discharge its notes or other evidences of debt. 3. Where it has suspended its ordinary and lawful busi- ness for at least one year. 4. If it has banking powers, or power to make loans on pledges or deposits, or to make insurances, where it be- comes insolvent or unable to pay its debts, or has violated any provision of the act, by or under which it was incorpo- rated, or of any other act binding upon it. Part II, Title II, Article III, Chapter XT, Code of Civil Procedure. § 1786. An action specified in the last section, may be Action by maintained by the attorney-general in the name and in be- generair half of the people; and whenever a creditor or stockholder of any corporation submits to the attorney-general a written statement of facts, verified by oath, showing grounds for an action under the provisions of the last section, and the When a orsditor or attorney-general omits, for sixty days after this submission, stockhoid- to commence an action specified in the last section, then, apply to and not otherwise, such creditor or stockholder may apply leave to to the proper court for leave to commence such an action, an action, and on obtaining leave may maintain the same accordingly. (As amended by chapter 301, Laws of 1880. ) Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. 39 306 " Code of Civil Pkoceduke of the Temporary § 1787. In an action, brought as prescribed in this article, the court may, upon proof of the facts authorizing the ac- tion to be maintained, grant an injunction order, restrain- ing the corporation, and its trustees, directors, managers, and other officers, from collecting or receiving any debt or demand, and from paying out, or in any way transferring or delivering, to any person, any money, property, or effects of the corporation, during the pendency of the action ; ex- cept by express permission of the court. Where the action is brought to procure the dissolution of the corporation, the injunction may also restrain the corporation, and its trus- tees, directors, managers, and other officers, from exercis- ing any of its corporate rights, privileges, or franchises, during the pendency of the action; except by express per- mission of the court. The provisions of title second of chapter seventh of this act, relating to the granting, vacat- ing, or modifying of an injunction order, apply to an in- junction order, granted as prescribed in this section; ex- cept that it can be granted only by the court. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. Beoeiver 8 1788. In such an action, the court may also, at any may heap- ° j ' j pointed, stage thereof, appoint one or more receivers of the property of the corporation. A receiver, so^ appointed, before final judgment is a temporary receiver, until final judgment is entered. A temporary receiver has power to collect and receive the debts, demands, and other property of the cor- poration ; to preserve the property, and the proceeds of the debts and demands collected ; to sell or otherwise dispose of the property as directed by the court ; to collect, re- ceive and preserve the proceeds thereof ; and to maintain any action or special proceeding for either of those pur- Must poses. He must qualify as prescribed by law for the quali- ^owers' of. fication of a permanent receiver. Unless additional powers are specially conferred upon him, as prescribed in the next section, a temporary receiver has only the powers specified in this section, and those which are incidental to the exer- cise thereof. A receiver, appointed by or pursuant to a final judgment in the action, or a temporary receiver who is continued by the final judgment, is a permanent re- ceiver, and has all the powers and authority conferred, and State of New Yoke. 307 is subject to all the duties and liabilities imposed upon a receiTer appointed* the voluntary dissolution of a corpo- ration. (As amended by chapter 399, of the Laws of 1882.) Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. § 1789. A temporary receiver, appointed as prescribed Additional in the last section, is, in all respects, subject to the control and duties of the court. In addition to the powers conferred upon conferred him, by the provisions of the last section, the court may, by porary re"- the order or interlocutory judgment appointing him, or by an order subsequently made in the action, or by the final judgment, confer upon him the powers and authority, and subject him to the duties and liabilities, of a permanent receiver, or so much thereof as it thinks proper; except that he shall not make any distribution among the credi- tors or stockholders, before final judgment, unless he is specially directed so to do by the court. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. § 1790. Where the action is brought by a creditor of a Making corporation, and the stockholders, directors, trustees, or holders, other officers, or any of them, are made liable by law, in parties, any event or contingency, for the payment of his debt, the persons, so made liable, may be made parties defendant, by the original or by a supplemental complaint; and their liability may be declared and enforced by the judgment in the action. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. § 1791. Where the stockholders, directors, trustees, or when other officers of a corporation, who are made liable, in any action event or contingency, for the payment of a debt, are not brought, made parties defendant, as prescribed in the last section, them, the plaintiff in the action may maintain a separate action against them, to procure a judgment, declaring, apportion- ing, and enforcing their liability. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. *Word "upon" left out of engrossed bill. Note — See chapter 378, Laws of 1888, "An act in relation to receivers of corporations." page 249- 308 Code of Civil Procedure of the Proceed- 8 1793. In an action, brought as prescribed in either of either ac- the last two sections, the court must, when it is necessary, cause an account to be taken of the property and of the debts of the corporation, and thereupon the defendant's liability must be apportioned accordingly; but, if it aflftrm- atiyely appears, that the cor23oration is insolvent, and has no property to satisfy its creditors, the court may, without taking such an account, ascertain and determine the amount of each defendant's liability, and enforce the same accordingly. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. Judgment- § 1793. A final judgment in an action, brought against corpora- a corporation, as prescribed in this article, either separately tion to be .. .... i,, . distributed or m conjunction with its stockholders, directors, trustees, or other officers, must provide for a just and fair distribu- tion of the property of the corporation, and of the proceeds thereof, among its fair and honest creditors, in the order and in the proportions prescribed by law, in case of the voluntary dissolution of a corporation. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. Id.; stocii 8 1794. Where the stockholders of a corporation are par- subscnp- " J. r Mods to ties to the action, if the property of the corporation is not berecov- i l j r ered. sufl&cient to discharge its debts, the interlocutory or final judgment, as the case requires, must adjudge that each stockholder pay into court the amount due and remaining unpaid, on the shares of stock held by him, or so much thereof as is necessary to satisfy the debts of the corpora- tion. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. Id • asto § 1795. If it appears, that the property of the coi-pora- ofdirect- ^^on, and the sums collected or collectible from the stock- stock-'^ holders, upon their stock subscriptions, are or will be in- holders, sufficient to pay the debts of the corporation, the' court must ascertain the several sums, for which the directors, trustees, or other officers, or the stockholders of the cor- poration, being parties to the action, are liable ; and must adjudge that the same be paid into court, to be applied, in State of New York. 309 such proportions and in such order as justice requires, to the payment of the debts of the corporation. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. 8 1796. This article does not repeal or affect any special Effect of • • J! 1 •!.• ii, i. X- 1 1 ■ J f this article provision oi law, prescribing that a particular Kind or cor- limited, poration shall cease to exist, or shall be dissolved, in a case or in a manner, not prescribed in this article ; or any special provision of law, prescribing the mode of enforcing the lia- bility of the stockholders of a particular kind of corpora- tion. Part II, Title II, Article III, Chapter XV, Code of Civil Procedure. § 1797. The attorney-general, whenever he is so directed Action by by the legislature, must bring an action against a cor- geifena^" poration created by or under the laws of the State, to pro- ^laturef* cure a judgment, vacating or annulling the act of incorpora- tion, or any act renewing the corporation, or continuing its corporate existence, upon the ground that the act was procured upon a fraudulent suggestion, or the conceal- ment of a material fact, made by or with the knowledge and consent of any of the persons incorporated. Part II, Title II, Article IV, Chapter XV, Code of Civil Procedure. § 1798. Upon leave being granted, as prescribed in the la.. by next section, the attorney-general may bring an action co^®°* against a corporation created by or under the laws of the State, to procure a judgment, vacating the charter or annull- ing the existence of the corporation, upon the ground that it has, either 1. Offended against any provision of an act, by or under which it was created, altered, or renewed, or an act amend- ing the same, and applicable to the corporation ; or, 2. Violated any provision of law, whereby it has forfeited its charter, or become liable to be dissolved, by the abuse of its powers ; or, 3. Forfeited its privileges or franchises, by a failure to exercise its powers ; or, 4. Done or omitted any act, which amounts to a surrender of its corporate rights, privileges, and franchises ; or. 310 Code of Civil Peoceduee oe the 5. Exercised a privilege or franchise, not conferred upon it by law. Part II, Title II, Article IT, Chapter XV, Code of Civil Procedure. Leave, § 1799. Before granting leave, the court may, in its dis- when and ,• • i - ,- £ ir, tx- how cretion, require such previous notice ot the application as gran e . ^^ thinks proper, to be given to the corporation, or any ofBcer thereof, and may hear the corporation in opposition thereto. Part II, Title II, Article IV, Chapter XV, Code of Civil Procedure. Action § 1800. An action, brought as prescribed in this article, a^ury! ^ is triable, of course and of right, by a jury, as if it was an action specified in section nine hundred and sixty-eight of this act, and without procuring an order, as prescribed in section nine hundred and seventy of this act. Part IT, Title II, Article IV, Chapter XV, Code of Civil Procedure. Judgment. § 1801. Where any of the matters, specified in section 1797 or section 1798 of this act, are established in an action, brought as prescribed in either of those sections, the court may render final judgment that the corporation, and each officer thereof, be perpetually enjoined from exercising any of its corporate rights, privileges, and franchises; and that it be dissolved. The judgment must also provide for the appointment of a receiver, the taking of an account, and the distribution of the property of the corporation, among its creditors and stockholders, as where a corporation is dissolved upon its voluntary application, as prescribed ia chapter seventeenth of this act. Part II, Title II, Article IV, Chapter XV, Code of Civil Procedure. Injunction § 1803. In an action, brought as prescribed ia this ar- may issue, ^jcig^ an injunction order may be granted, at any stage of the action, restraining the corporation, and any or all of its directors, trustees, and other officers, from exercising any of its corporate rights, privileges, or franchises; or from exercising certain of its corporate rights, privileges, or franchises, specified in the injunction order; or from exercising any franchise, liberty, or privilege, or transact- ing any business, not allowed by law. Such an injunction. State of New York. 311 is deemed one of those specified in section 603 of this act, and all the provisions of title second of chapter seventh of this act, applicable to an injunction specified in that section, apply to an injunction granted as prescribed in this section, except that it can be granted only by the court. Part II, Title II, Article IV, Chapter XT, Code of Civil Procedure. 8 1803. When final iudgment is rendered against a cor-Copyof ° J t> o :udgment- poration, in an action, brought as prescribed in this article, £j''j'°'^? the attorney-general must cause a copy of the judgment published, roll to be forthwith filed in the ofB.ce of the secretary of State; who must cause a notice of the substance and effect of the judgment, to be published, for four weeks, in the newspaper printed at Albany, in which legal notices are re- quired to be published, and also in a newspaper printed in the county, wherein the principal place of business of the corporation was located. Part II, Title II, Article IV, Chapter XV, Code of Civil Procedure. § 1804. Articles second, third and fourth of this title, do certain not apply to an incorporated library society; to a religious tioiis'ex- corporation; to a select school or academy, incorporated by fromcer- the regents of the university, or by an act of the legisla- ticies^in ture; or to a municipal or other political corporation, cre- ated by the constitution, or by or under the laws of the State. Part II, Title II, Article V, Chapter XV, Code of Civil Procedure. § 1805. In an action, brought as prescribed in article officers second, third, or fourth of this title, a stockholder, officer, may be alienee, or agent of a corporation, is not excused from an- to testify, swering a question, relating to the management of the cor- poration, or the transfer or disposition of its property, on the ground that his answer may expose the corporation to a forfeiture of any of its corporate rights, or will tend to convict him of a criminal offence, or to subject him to a penalty or forfeiture. But his testimony shall not be used, as evidence against him, in a criminal action or special pro- ceeding. Part II, Title II, Article V, Chapter XV, Code of Civil Procedure. 312 Code of Civil Phooedube of the Injunction staying ac- tions by creditors. § 180C. In sucli an action, the court may, in its discre- tion, on the application of either party, at any stage of the action, before or after final judgment, and with or without security, grant an injunction order, restraining the credit- ors of the corporation from bringing actions against the defendants, or any of them, for the recovery of a sum of money, or from taking any further proceedings in such ac- tions, theretofore commenced. Such an injunction has the same effect, and, except as otherwise expressly pre- scribed in this section, is subject to the same provisions of law, as if each creditor, upon whom it is served was named therein, and was a party to the action in which it was granted. Part II, Title II, Article V, Chapter XY, Code of Civil Procedure. Actions against corpora- tions, rights of creditors to provS claims. Notice thereof, how pub- lished. Bights of certain creditors before final distri- bution. § 1807. In such an action the court may, at any stage of the action, before or after final judgment, make an order requiring all the creditors of the corporation to ex- hibit and prove their claims, and thereby make themselves parties to the action, in such a manner and in such a reasonable time, not less than six months from the first publication of notice of the order as the court directs ; and that the creditors who make default in so doing shall be precluded from all benefit of the judgment and from any distribution which may be made thereunder, except as hereinafter provided. Notice of the order must be given, by publication, in such newspapers and for such a length of time as the court directs. Notwithstanding such order any such creditor who shall exhibit and prove his claim in the manner directed thereby, with proof, by affidavit or otherwise, that he has had no notice or knowledge thereof in time to comply therewith, any time before an order is made directing a final distribution of the assets of such corporation, shall be entitled to have his claim received, and shall have the same rights and benefits thereon, so far as the assets of such corporation then remaining undis- tributed may render possible, as if his claim had been ex- hibited and proved within the time limited by such order. (As amended by chapter 372 of the Laws of 1886.) Part II, Title II, Article V, Chapter XV, Code of Civil Procedure. State ob New York. 313 § 1808. Where the attorney-general has good reason to when at- believe, that an action can be maintained in behalf of the general must bring people of the State, as prescribed in article second, third, or action, fourth of this title, except section seventeen hundred and ninety-seven of this act, he must bring an action ac- cordingly, or apply to a competent court for leave to bring an action, as the case requires, if, in his opin- ion, the public interests require that an action should be brought. In a case where the action can be brought only by the attorney-general in behalf of the people, if a creditor, stockholder, director, or trustee of the corporation, applies to the attorney-general for that purpose, and fur- nishes the security required by law, the attorney-general must bring the action, or apply for leave to bring it, if he has good reason to believe, that it can be maintained. Where such an application is made, section nineteen hundred and eighty-six of this act applies thereto, and to the action brought in pursuance thereof. Part II, Title II, Article V, Cliapter XV, Code of Civil Procedure. 8 1809. An iniunction order, suspending the general and Eequi- ^- -u • P /■ f ■ ■ . 4. , sitesof in- ordinary business ot a corporation, or oi a jomt-stock asso- junction ...... ,. against ciation, consisting ot seven or more persons, or suspending corpora- from oflQce, or restraining from the performance of his du- certain ties, a trustee, director, or other ofFicer thereof, can be granted only by the court, upon notice of the application therefor, to the proper officer of the corporation or associa- tion, or to the trustee, director, or other officer enjoined. If such an injunction order is made, otherwise than as pre- scribed in this section, it is void. Part II, Title II, Article V, Chapter XV, Code of Civil Procedure. § 1810. A receiver of the property of a corporation can be appointed only by the court, and in one of the follow- order ap- ing cases : ' receiver in ° certain 1. An action, brought as prescribed in article second, «ases. third, or fourtli of this title. 2. An action brought lor the foreclosure of a mortgage upon tlie property, of which the receiver is appointed, where the mortgage debt, or the interest thereupon, has remained unpaid, at least thirty days after it was payable, 314 Code of Civil Pkocedukb of the and after payment thereof was duly demanded of the proper ofQcer of the corporation ; and where either the income of the property is specifically mortgaged, or the property itself is probably insufficient to pay the mortgage debt. 3. An action brought by the attorney-general, or by a stockholder, to preserve the assets of a corporation, having no officer empowered to hold the same. 4. A special proceeding for the voluntary dissolution of a corporation. Where the receiver is appointed in an action, otherwise than by or pursuant to a final judgment, notice of the ap- plication for his appointment, must be given to the proper officer of the corporation. Part II, Title II, Article V, Chapter XV, Code of Civil Procedure. See chapter 378, Laws of 1883, "An act ia relation to receivers of corpo- rations.'* page 249. Id.; of judicial suspen- sion or removal of an officer. § 1811. A trustee, director, or other officer of a corpora- tion shall not be suspended or removed from office, by a court or judge, otherwise than by the final judgment of a competent court, in an action brought by the attorney- general, as prescribed in section one thousand seven hun- dred and eighty-one of this act. Part II, Title II, Article V, Chapter XV, Code of Civil Procedure. Applica- tion of the last three sec- tions. § 1813. The last three sections apply to an action or a special proceeding, against a corporation, or joint-stock asso- ciation created by or under the laws of the State, or a trus- tee, director, or other officer thereof; or against a corpora- tion, or joint-stock association created by or under the laws of another state, government, or country, or a trustee, director, or other officer thereof, where the corporation or association does business within the State, or has, within the State, a business agency or a fiscal agency, or an agency for the transfer of its stock. Part II, Title II, Article V, Chapter XV, Code of Civil Procedure. § 1813. Where an action, authorized by a law of the State, is brought against one or more persons, as stock- mi'snoraer, holders of a Corporation or joint-stock association, an ob- avai'iabie. jectiou to any of the proceedings cannot be taken, by a per- In action against stock- State of New Yoek. 315 son properly made a defendant in the action on the ground that the plaintiff has joined with him, as a defendant in the action, a person, whose name appears on the stock- books of the corporation or association, as a stockholder thereof, by the name so appearing; but who is misnamed, or dead, or is not liable for any cause. In such a case, the court may, at any time before final judgment, upon motion of either party, amend the pleadings and other papers, without prejudice to the previous proceedings, by substitut- ing the true name of the person intended, or by striking out the name of the person who is dead, or not liable, and, in a proper case, inserting the name of the representative or successor. Part II, Title II, Article V, Chapter XV, Code of Civil Procedure. 8 623. The damages, sustained by reason of an iniunc- Damages, . ^ ' ■' howascer- tion, may be ascertained and determined by the court, or tained. by a referee, appointed by the court, or by a writ of inquiry, or otherwise, as the court shall direct; and the decision of the court thereupon, or an order confirming the report of the referee, is conclusive, as to the amount of those dam- ages, upon all the persons who have executed the under- taking, unless it is reversed upon appeal. The court may, in its discretion, direct that the sureties have notice of the hearing, or of an appeal, and may prescribe the time and manner of giving them notice. (As amended by chapter 416, Laws of 1877.) Part I, Title II, Article II, Chapter Vlt, Code of Civil Procedure. 8 634. Where the defendant enjoined was an ofiicer of Damages " ■> sustained a corporation, or joint-stock association, or a bailee, agent, ^y. ^ trustee, or other representative of another, and the damages, ^°"- sustained by him, are less than the sum specified in the undertaking, the court or the referee may also separately ascertain and determine the damages sustained, by reason of the injunction, by the corporation, association, or person, whom the defendant represents, to an amount not exceed- ing the surplus of the sum specified in the undertaking ; and those damages may be recorded in a separate action, brought as prescribed in the next section. Part I, Title II, Article II, Chapter VII, Code of Civil Procedure. 316 Code of Civil Pkoceduee of the Action on the un- dertaking. Warrant of attacli- ment, granting of. What must be shown to procure the war- rant. § 625. Where the damages have been ascertained by the decision of the court, or the confirmation of a referee's report, as prescribed in the last two sections, any person, entitled to the benefit of an undertaking, executed pur- suant to the provisions of this title, may bring an action thereon, without further leave of the court. Part I, Title II, Article 11, Chapter VII, Code of Civil Procedure. 635. A warrant of attachment against the property of one or more defendants in an action, may be granted upon the application of the plaintiff, as specified in the next session*, where the action is to recover a sum of money only, as damages for one or more of the following causes: 1. Breach of contract, express or implied, other than a contract to marry. 2. Wrongful conversion of personal property. 3. Any other injury to personal property, in consequence of negligence, fraud, or other wrongful act. (As amended by chapter 416, Laws of IS?"/ ) Part I, Title III, Article 1, Chapter VII, Code of Civil Procedure. § 636. To entitle the plaintiff to such a warrant, he must show, by affidavit, to the satisfaction of the judge granting the same, as follows: 1. That one of the causes of action specified in the last section exists against the defendant. If the action is to recover damages for breach of a contract, the afi&davit must show that the plaintiff is entitled to recover a sum stated therein, over and above all counterclaims known to him. 3. That the defendant is either a foreign corporation or not a resident of the State; or, if he is a natural person and a resident of the State, that he has departed there- from, with intent to defi'aud his creditors, or to avoid the service of a summons, or keeps himself concealed therein with the like intent; or, if the defendant is a natural per- son or a domestic corporation, that he or it has removed, or is about to remove, property from the State, with intent to defraud his or its creditors; or has assigned, disposed of, or secreted, or is about to assign, dispose of or secrete prop- * So in the original. State of New 'Yoek. 317 erty, with the like intent. (As amended by chapter 416, Laws of 1877.) Part I, Title III, Article I, Chapter Til, Code of Civil Procedure. § 64G. Uader a warrant of attachment against a foreign Attach- ■ , , , , • -, , f ment of corporation, other than a corporation created by or under unpaid the laws of the United States, the sheriff may levy upontioiito the sum remaining unpaid upon a subscription to the capi- oorpora- tal stock of the corporation, made by a person within the county; or upon one or more shares of stock therein, held by such a person, or transferred by him, for the purpose of avoiding payment thereof. Part I, Title III, Article II, Chapter Til, Code of Civil Procedure. § 647. The rights of shares which the defendant has in-ja . jnter- the stock of an association or corporation, together with porition!^' the interest and profits thereon, may be levied upon; and the sheriff's certificate of the sale thereof entitles the pur- chaser to the same rights and privileges, with respect thereto, which the defendant had, when they were so attached. Part I, Title III, Article II, Chapter Til, Code of Civil Procedure. I 650. Upon the application of a sheriff, holding a war- Certifloate rant of attachment, the president or other head of an ant's in- association or corporation, or the secretary, cashier, or be fur- managing agent thereof, or a debtor of the defendant, or a person holding property, including a bond, promissory note, or other instrument for the payment of money, belonging to the defendant, must furnish to the sheriff a certificate, under his hand, specifying the rights or num- ' her of shares of the defendant, in the stock of the association or corporation, with all dividends declared, or incumbrances thereon; or the amount, nature, and descrip- tion of the property, held for the benefit of the defendant, or of the defendant's interest in property so held, or of the debt or* demand owing to the defendant, as the case requiras. Part I, Title III, Article II, Chapter Til, Code of Civil Procedure. § 651. If a person, to whom application is made, as pre- f"^°y:, scribed in the last section, refuses to give such a certificate; certifloate ' ° _ _ ' may be ex- or if it is made to appear, by affidavit, to the satisfaction alined. 318 Code of Civil Peocedueb of the of the court, or a judge thereof, or the county judge of the county to which the warrant is issued, that there is reason to suspect that a certificate given by him is untrue, or that it fails fully to set forth the facts, required to be shown thereby; the court or judge may make an order, directing him to attend, at a specified time, and at a place within the county to which the warrant is issued, and submit to an examination under oath, concerning the same. The order may, in the discretion of the court or judge, direct an appearance before a referee named therein. Fart I, Title III, Article II, Chapter VII, Code of Civil Procedure. ment'of' § '^^'^ ■ ^^i^re a defendant, who has not appeared, is a non- agafnst "'^ resident of the state, or a foreign corporation, and the sum- denireto i^ons was served without the state, or by publication, pur- suant to an order obtained for that purpose, as prescribed in chapter fifth of this act, the judgment can be enforced only against the property which has been levied upon, by virtue of the warrant of attachment, at the time when the judg- ment is entered. But this section does not declare the effect of such a judgment, with respect to the application of any statute of limitation. (As amended by chapter 416, Laws of 1877.) Part I, Title III, Article V, Chapter VII, Code of Civil Procedure. Prefer- § 791. Civil causes are entitled to preference among in civil xhemselves, in the trial or hearing thereof, in the following order, next after the causes specified in the last section but one: (As amended by chapter 120, Laws of 1887.) Corpora- Subd. 7. An action against a corporation or joint-stock joinLstocii: association issuing bank notes or any kind of paper cred- tio'ns.'^tc. its, to circulate as money, or by or against the receiver of such corporation or association. An action in which a county or town is sole plaintiff or defendant. (As amended by chapter 397, Laws of 1883, and chapter 130, Laws of 1887.) Ibid. Subd. 8. An action against a corporation, founded upon a note or other evidence of debt, for the absolute payment of money. An action upon an undertaking given upon an appeal to the Court of Appeals or to stay the execution on State of New York. 319 an appeal to the Court of Appeals. (As amended by chap- ter 543, Laws of 1879, and chapter 120, Laws of 1887.) Part I, Title VI, Article II, Chapter Till, Code of Civil Procedure. § 839. The admission of a member of an aggregate cor- ^/Se,nf° poration, who is not a party, shall not be received as evi- poratio'u.'"" dence against the corporation, unless it was made concern- ing and while engaged in a transaction, in which he was the authorized agent of the corporation. Part I, Title I, Article I, Chapter IX, Code of Civil Procedure. § 868. The production, upon a trial, of a book or paper. Rooks, belonging to or under the control of a corporation, may be corpora- compelled, in like manner as if it was in the hands, or un- produced, der the control, of a natural person. For that purpose, a subpcEna duces tecum, or an order, made as prescribed in the last section, as the case requires, must be directed to the president, or other head of the corporation, or to the oflB.cer thereof, in whose custody the book or paper is. Part I, Title II, Chapter IX, Code of Civil Procedure. § 869. In a case specified in the last section, or where a when per- subpoena duces tecum, or an order, made as prescribed in tendance not re- section 86'j or section 867 of this act, requires a public quired by officer to attend, and bring a book or paper under his control, duces the subpoena or order is deemed to be sufficiently obeyed, if the book or paper is produced by a sabordinate officer or employee of the corporation, or in the public office, who possesses the requisite knowledge to identify it, and to testify respecting the purposes for which it is used. If the personal attendance of a particular officer of the corpora- tion or public officer is required, a subpoena, without a duces tecum clause, must also be served upon him. Part I, Title II, Chapter IX, Code of Civil Procedure. § 873. The person desiring to take a deposition, as pre- Appiica- scribed in this article, may present to a judge of the court tents of"' in which the action is pending; or, if it is pending in the * ^" ' supreme court, to a county judge; or, if an action is not pending, but is expected to be brought, to a judge of the supreme court, or of a superior city court, or to a county judge; an affidavit setting forth as follows: 320 Code of Civil PROCBDUiiE of the Whataffl- Subd. 7. Any other fact necessary to show that the case state. comes within one of the last two sections, and if the party sought to be examined is a corporation, the affidavit shall state the name of the officers or directors thereof, or any of them whose testimony is necessary and material, or the books and papers as to the contents of which an ex- amination or inspection is desired, and the order to be made in respect thereto shall direct the examination of such persons and the production of such books and pa- pers. (As amended by chapter 536, Laws of 1880.) Part I, Title III, Article I, Chapter IX, Code of Civil Procedure. Book of § 929. Where a party wishes to prove an act or transac- corp'ora- tion of a foreign corporation, the book or books of the cor- tion; when ,. , n j? ji i_ j_- • ev'deace. poration may be used tor that purpose, as presumptive evi- dence, whether any or all of the parties are or are not members of the corporation. Part I, Title IV, Article I, Chapter IX, Code of Civil Procedure. When a §930. If an original book is not produced at the trial, thereof is as prescribed in the last section, a copy thereof, or of an evidence. -^ ' i j ' entry therein, verified as prescribed in the next section, may be used, with like effect as the original book; provided that the party, intending to use the copy, gives the adverse party at least ten days' notice of his intention, specifying briefly the nature of the evidence proposed to be given. But this and the next section do not apply, where the foreign corporation is a party to the action, and seeks to prove its own act or transaction, in its own behalf. Part I, Title IV, Article I, Chapter IX, Code of Civil Procedure. How copy § 931. The copy must be verified by the deposition, to^be ven- j^^^^ ^ prescribed by law, or the oral testimony, taken at the trial, of the person who made it, or of a person who has examined and compared it with the original book, or the entry therein. The witness must testify that the copy produced is correct; that he made it, or compared it with the original ; and that he then knew that the original book so copied, or containing the entry, was the book of the corporation ; or that it was then acknowledged to him to be such, by an oflScer or receiver of the corporation, or a State of New Yore. 321 person having the custody thereof, naming the person who made the acknowledgment ; and he must specify where, and in whose custody, the original was then kept. Part I, Title IV, Article I, Chapter IX, Code of Civil Procedure. § 960. Where a seal of a public officer or of a corpora- gg,^j ^^ tion is authorized or required by law, it may be impressed ^"rs^whwe directly on the paper. (As amended by chapter 416, Laws 'i2^a^''|fg'°" of 1877.) ™«'i«- Part I, Title V, Chapter IX, Code of Civil Procedure. § 1013. But a reference shall not be made, of course, upon Eeference the consent of the parties, in an action to annul a marriage, wlen'and'' or for a divorce or a separation ; or an action against a QuIiSoa-^' corporation, to obtain a dissolution thereof, the appoint- *'°° °'' nlent of a receiver of its property, or the distribution of its property, unless it is brought by the attorney-general ; or an action wherein a defendant, to be affected by the result of the trial, is an infant. In a case specified in this section, where the parties consent to a reference, the court may, in its discretion, grant or refuse a reference; and, where a reference is granted, the court must designate the referee. Part I, Title II, Chapter X, Code of Civil Procedure. 8 1317. A iudgment shall not be rendered for a sum of Attach- ° , "^ ,. . T , ment and money only, upon an application made pursuant to the undertak- last section, except in an action specified in section six restitution, .^ required Iq hundred and thirtv-five of this act. When the defendant certain ac- tions. IS a non-resident, or a foreign corporation, and has not appeared, the plaintiff, upon the application for judgment in such an action, must produce and file the following papers: 1. Proof, by affidavit, that a warrant of attachment, granted in the action, has been levied upon property of the defendant. 3. A description of the property, so attached, verified by affidavit; with a statement of the value thereof, according to the inventory. 3. The undertaking mentioned in section one thousand two hundred and sixteen, if one has been required. Part I, Title I, Article II, Chapter XI, Code of Civil Procedure. 41 323 Code of Civil Peocedueb of the ARTICLE FrPTH. Action to Compel the Deteemination of a Claim to Ebal Peopeett. This 8 1650. An action may be maintained, as prescribed in anicle ap- " . i • o 'i plies to this article, by or against a corporation, as ii it was a corpora- i j (o tions. natural person. Part II, Title I, Article VI, Chapter XIV, Code of Civil Procedure. ARTICLE FIRST. Applica- tion of this arti- cle; what property cannot be reached. What claims or demands may be trans- ferred. Judgment Cebditou's Action". § 1879. This article does not apply to a case, where the judgment debtor is a corporation, created by or under the laws of the State. Nor does it authorize the discovery or seizure of, or other interference with, any property which is expressly exempted by law from levy and sale, by virtue of an execution ; or any money, thing in action, or other property, held in trust for a judgment debtor, where the trust has been created by, or the fund so held in trust has proceeded from, a person other than the judgment debtor; or the earnings of the judgment debtor for his personal services, rendered within sixty days next before the commencement of the action, where it is made to appear, by his oath or otherwise, that those earnings are necessary for the use of a family, wholly or partly supported by liis labor. Part II, Title IV, Article II, Chapter XV, Code of Civil Procedure. § 1910. Any claim or demand can be transferred, except in one of the following cases: 1. Where it is to recover damages for a personal injury, or for a breach of promise to marry. 2. Where it is founded upon a grant, which is made void by a statute of the State ; or upon a claim to or interest in real property, a grant of which, by the transferor, would be void by such a statute. 3. Where a transfer thereof is forbidden by a statute of State of New Yoek. 323 the State, or of the United States, or ■would contravene public policy. Part II, Title IV, Article V, Chapter XV, Code of Civil Procedure. § 1911. A cause of action to cancel, or otherwise affect, M; cause .of action an instrument executed, or an act done, as security for a for usury, usurious loan or forbearance, can be thus transferred, where the instrument or act creates a specific charge upon prop- erty, which is also transferred in disaflQrmance thereof, and not otherwise; but, in that case, the transferee does not succeed to the right, conferred by statute upon the borrower, to procure relief, without paying, or offering to pay, any part of the sum or thing loaned. Part II, Title IV, Article V, Chapter XV, Code of Civil Procedure. § 1916. A surety, including a drawer or indorser, may Action by recover, in an action against his jsrincipal; and an execu- trustee to tor, administrator, or other trustee, may, where the trust costs, etc. estate is insufficient to reimburse him, recover, in an action against the beneficiary whom he represents; his reasonable costs and other expenses, incurred necessarily and in good faith, in the prosecution or defence, by the express or implied consent of the principal or beneficiary, of an action or special proceeding, relating to the demand secured, or to the trust estate, as the case requires. This section does not affect any special agreement relating to those costs and expenses. Part II, Title IV, Article V, Chapter XV, Code of Civil Procedure § 1917. Where it appears, upon the trial of an action. Action that a negotiable promissory note or bill of exchange, upon neeotiabie which the action, or a counterclaim interposed in the action, is founded, was lost, while it belonged to the party claiming the amount due thereupon, he may prove the contents thereof, by parol or other secondary evidence, and may recover or set off the amount due thereupon, as if it was produced. But for that purpose, he must give to the adverse party a written undertaking, in a sum fixed by the Judge or the referee, not less than twice the amount of the note or bill, with at least two sureties, approved by the -judge or the referee, to the effect, that he will indemnify 324 Code of Civil Pbocbduee of the the adverse party, his heirs and personal representatives, against any claim by any other person, on account of the note or bill, and against all costs and expenses, by reason of such claim. Part II, Title IV, Article V, Chapter XV, Code of Civil Procedure. Atorney- § 1948. The attorney-general may maintain an action, may main- upon his own information, or upon the complaint of a pri- tion. vate person, in either of the following cases: 1. Against a person yfho usurps, intrudes into, or unlaw- fully holds or exercises, within the State, a franchise, or a public office, civil or military, or an office in a domestic corporation. 2. Against a public officer, civil or military, who has done or suffered an act, which by law works a forfeiture of his office. 3. Against one or more persons who act as a corporation, within the State, without being duly incorporated; or exer- cise, within the State, any corporate rights, privileges, or franchises, not granted to them by the law of the State. Part II, Title I, Article I, Chapter XVI, Code of Civil Procedure. One action § 1954. "Where two or more persons claim to be entitled several to the same office or franchise, the attorney-general may persons, ^^'mg the action against all, to determine their respective rights thereto. Part II, Title I, Article I, Chapter XVI, Code of Civil Procedure. When in- § 1955. In an action, brought as prescribed in subdivision inay \ie" third of section nineteen hundred and forty-eight of this act, grante . ^^^ g^^^ judgment, in favor of the plaintiff, must perpetually restrain the defendant or defendants, from the commission or continuance of the act or acts complained of. A temporary injunction to restrain the commission or continuance thereof, may be granted, upon proof, by affidavit, that the defendant or defendants enjoined have acted as a corpora- tion, within the State, without being duly incorporated, or have usurped, exercised, or claimed, within the State, a franchise, liberty, or corporate right, not granted to them by law. The provisions of title second of chapter seventh of this act apply to such a temporary injunction, and the State of New York. 335 •proceedings thereupon, except where special provision is otherwise made in this title. For that purpose, the injunc- tion order is deemed to have been granted as prescribed in section six hundred and three of this act. Part II, Title I, Article I, Chapter XVI, Code of Civil Procedure. § 1987. Where final judgment in an action, brought as costs; how prescribed in this title, is rendered against a corporation, agafnst'' or persons claiming to be a corporation, the court may di- tSn'an^ rect the costs to be collected by execution against any of of "ran" the persons claiming to be a corporation ; or by warrant of attachment, or other process, against the person of any director or other officer of the corporation. Part II, Title I, Article TI, Chapter XVI, Code of Civil Procedure. § 2441. Upon proof, by affidavit, or other competent writ- Order to , 6X3Q11I16 ten evidence, to the satisfaction of the judge, that anexecu- person " ° having tion against property has been issued, as prescribed in section property, twenty-four hundred and fifty-eight of this act, and either i"Jf™*°* that it has been returned wholly or partly unsatisfied, or that it has not been returned; and also that any person or corpora- tion has personal property of the judgment debtor, exceed- ing ten dollars in value, or is indebted to him in a sum ex- ceeding ten dollars ; the judgment creditor is entitled to an order, requiring that person or corporation to attend and be examined concerning the debt, or other property, at a time and place specified in the order. The judge may, in his dis- cretion, require notice of the subsequent proceedings to be given to the judgment debtor, in such a manner as he deems just. But a receiver shall not be appointed without such a notice ; except as otherwise prescribed in article second of this title. Part II, Title XII, Article I, Chapter XVII Code of Civil Procedure. § 3463. This article does not apply where the judgment Proooed- debtor is a corporation created by or under the laws of the piementa- State or a foreign corporation specified in section one thou- outionfnot sand eight hundred and twelve of this act, except in those oertaFn^ actions or special proceedings brought by or against the peo- ple of the State. Nor does it authorize the seizure of, or other interference with, any property which is expressly 326 Code of Civil Procedure of the exempt by law from levy and sale by virtue of an execution ; or any money, thing in action, or other property held in trust for a judgment debtor, where the trust has been created by, or the fund so held in trust has proceeded from, a person other than the judgment debtor; or the earnings of the judgment debtor for his personal' services rendered within sixty days next before the institution of the special proceeding ; when it is made to appear by his oath or other- wise that those earnings are necessary for the use of a fam- ily, wholly or partly supported by his labor. (As amended by chapter 26, Laws of 1886.) Part II, Title XII, Article I, Chapter XVII, Code of Civil Procedure. Actions cognizable § 2865. An action, cognizable by a justice of the peace, aeatnst ™^y ^^ brought by or against a corporation ; by or against brou\t ^ natural person in his own right ; by or against a town or county officer in his official character ; or by an executor, administrator, trustee of an express trust, or a receiver in supplementary proceedings. (As amended by chapter 399, Laws of 1882.) Part II, Title I, Chapter XIX, Code of Civil Procedure. M-iscei- § 3343. Ill construing this act, the following rules must general be observed, except where a contrary intent is expressly and rules declared in the provision to be construed, or plainly appar- struotion. ent from the context thereof : Subd. 18. A "domestic corporation" is a corporation created by or under the laws of the State ; or located in the State, and created by or under the laws of the United States, or by or pursuant to the laws, in force in the colony of ISTew York, before the nineteenth day of April, in the year 1775. Every other corporation is a " foreign corpo- ration.'" Part II, Title I, Chapter XXII, Code of Civil Prooedurb. State of New York. 3'i7 PEOVISIOlirS OP THE CODE OP CRIMINAL PRO- CEDURE APPLICABLE TO CORPORATIOlfS. 8 675. Upon an information against a corporation, the Summons . . , , upon an magistrate must issue a summons, signed by him, with his informa- name of office, requiring the corporation to appear before sentment him, at a specified time and place, to answer the charge ; corpora- the time to be not less than ten days after the issuing of whom la- '' ° sued, and the summons. when re- turnable. Part IV, Title XII, Article VIII, Chapter IX, Code of Criminal Procedure. § 676. The summons must be in substantially the follow ing form : "County of Albany [or as the case may be] : Form of "In the name of the people of the State of New York : summons. ' ' To the [naming the corporation] : ' ' You are hereby summoned to appear before me, at [naming the place], on [specifying the day and hour], to answer a charge made against you, upon the information of A. B., for [designating the offense generally]. " Dated at the city [or ' town '] of , the day of , 18 . " Q. H., Justice of the Peace." [or as the case may be..] Part IV, Title XII, Article VIII, Chapter IX, Code of Criminal Procedure. § 677. The summons must be served at least five days when and before the day of appearance fixed therein, by delivering a served, copy thereof and showing the original to the president, or other head of the corporation, or to the secretary, cashier, or managing agent thereof. Part IV, Title XII, Article VIII, Chapter IX, Code of Criminal Procedure. § 678. At the time appointed in the summons, the magis- Examina- trate must proceed to investigate the charge, in the sameohM-ge.*'^^ manner as in the case of a natural person brought before him, so far as those proceedings are applicable. Part IV, Title XII, Article 'VIII, Chapter IX, Code of Criminal Procedure. § 679. After hearing the proofs, the magistrate must Certmcate certify upon the depositions, either that there is or is not gistrate. 338 Pen-al Code of the and return sufficient cause to believe the corporation guilty of the of- with the fense charged, and must return the depositions and certifi- tions. cate, in the manner prescribed in section two hundred and twenty-one. Part IT, Title XII, Article Till, Chapter IX, Code of Criminal Procedure. Grand jury § 680. If the magistrate return a certificate that there is oeed as in sufficient cause to believe the corporation guilty of the of- the case of . in a naturii fense charged, the grand jury may proceed thereon, as m the case of a natural person held to answer. Part IT, Title XII, Article Till, Chapter IX, Code of Criminal Procedure. person. Appear- § 681. If an indictment be found against a corporation, plea t*o fn- it ''^^J appear by counsel, to answer the same. If it do not and^ro-'' thus appear, a plea of not guilty must be entered, and the thereonf Same proceedings had thereon as in other cases. Part IT, Title XII, Article Till, Chapter IX, Code of Criminal Procedure. Fine, on § 683. When a fine is imposed upon a corporation, on how col- ' conviction, it may be collected by virtue of the order im- posing it, by the sheriff of the county, out of their real and personal property, in the same manner as upon an exe- cution in a civil action. Part IT, Title XII, Article Till, Chapter IX, Code of Criminal Procedure. PBOVISIONS OF THE PENAL CODE APPLICABLE TO CORPORATIONS. Libel de- § 243. A malicious prosecution, by writing, printing, picture, effigy, sign or otherwise than by mere speech, which exposes any living person, or the memory of any person deceased, to hatred, contempt, ridicule or oblo- quy, or which causes, or tends to cause any person to be shunned or avoided, or which has a tendency to injure any person, corporation or association of persons, in his or their business or occupation, is a libel. Title IX, Chapter Till, Penal Code. State of New Yokk. 329 § 243. A person who publishes a libel is guilty of a mis- Libei a demeauor. meanor. Title IX, Chapter VIII, Penal Code. § 378. A person who directly or indirectly receives any Taking interest, discount, or consideration upon the loan or for- "^"""y- bearance of money, goods or things in action, greater than is allowed by statute, is guilty of a misdemeanor. Title XI, Penal Code. § 435. A person who, with intent to affect the market False price of the public funds of this state or of the United to public States, or of any state or territory thereof, or of a foreign country or government, or of the stocks, bonds, or other evidences of debt of a corporation or association, or the market price of gold or silver coin or bullion, or any mer- chandise or commodity whatever, 1. Without lawful authority, falsely signs the name of an officer of a corporation, or of any other person to a let- ter, message, or other paper; or, 2. Utters or circulates such letter, message or paper, knowing that the same has been so falsely signed; or, 3. Knowingly circulates any false statement, rumor, or intelligence; Is punishable by a fine of not more than five thousand dollars, or by imprisonment for not more than three years, or both. Title XII, Penal Code. § 609. A person is guilty of forgery in the first degree J'orgery in who with intent to defraud, forges, defined. Subd. 3. A certificate, bond, paper writing, or other public security, issued or purporting to have been issued by or under the authority of this state, or of the United States, or of any other state or territory of the United States, or of any foreign government, country or state, or by any officer thereof in his official capacity, by which the payment of money is promised absolutely or upon any con- tingency, or the receipt of any money or property is ac- knowledged, or being or purporting to be evidence of any 330 Penal Code of the debt or liability, either absolute or contingent, issued or purporting to have been issued by lawful authority; or, 4. An indorsement or other instrument, transferring or purporting to transfer the right or interest of any holder of such a certificate, obligation, public security, evidence of debt or liability, or of any person entitled to such right or interest; or, 5. A certificate of stock, bond or other writing, bank note, bill of exchange, draft, check, certificate of deposit, or other obligation or evidence of debt, issued or purporting to be issued by any bank, banking association or body corporate existing under the laws of this state, or of the United 8tates, or of any other state, government or country, declaring or purporting to declare any right, / title or interest of any person in any portion of the capital stock, or property of such a body corporate, or promising or purporting to promise or agree to the payment of money, or the performance of any act, duty or obligation; or, 6. An indorsement or other writing, transferring or pur- porting to transfer the right or interest of any holder of such certificate, bond, or writing obligatory, of any person entitled to such right or interest. Title XV, Chapter III, Penal Code. Forgery in § ^^^- ^ person is guilty of forgery in the second degree second de- ^y]^o^ with intent to defraud, 1. Forges the great or privy seal of this state, the seal of any court of record, or of any public ofiice or officer authorized by law, or of any body corporate created by or existing under the laws of this state, or of the United States, or of any other state or any territory of the United States, or of any other state, government or country, or any impression of such a seal ; or any gold or silver coin, whether of the United States or of any foreign state, government or country ; or, 2. Forges a record of a will, conveyance, or instrument of any kind, the record of which is by the law of this state made evidence, or of any judgment, order, or decree of any court or oflQcer, or a certified or authenticated copy thereof; or, A judgment roll, judgment, order, or decree of any court State of New Yoke. 331 or oflBcer, or an enrollment, thereof, or a certified or authen- ticated copy thereof, or any document or writing purport- ing to be such judgment, order, decree, enrollment, or copyj or. An entry made in any book of record or accounts, kept by or in the office of any officer of this state, or of any Tillage, city, town, or county of this state, by which any demand, claim, obligation, or interest, in favor of or against the people of the state or any city, village, town or county, or any officer thereof, is or purports to be created, increased, diminished, discharged, or in any manner affected; or an entry made in any book of records or accounts kept by a corporation doing business within the state, or in any ac- count kept by such a corporation, whereby any pecuniary obligation, claim, or credit is or purports to be created, increased, diminished, discharged, or in any manner affect- ed; or. An instrument, document, or writing, being or purporting to be a process or mandate issued by a competent court, magistrate, or officer of the state, or the return of an officer, court or tribunal, to such a process or mandate ; or a bond, recognizance, undertaking, pleading, or proceeding, filed or entered in any court of the state, or a certificate, order or allowance by a competent court, or officer, or a license or authority granted pursuant to any statute of the state or a certificate, document, instrument, or writing, made evidence by any law or statute; or. An instrument or writing, being or purporting to be the act of another, by which a pecuniary demand or obligation is or purports to be or to have been created, increased, discharged, or diminished, or in any manner affected, or by which any rights or property whatever are or purport to be or to have been created, transferred, conveyed, dis- charged, increased, or diminished, or in any manner affected, the punishment for forging, altering, or countefeiting which is not hereinbefore prescribed, by which false making, forging, altering, or counterfeiting, any person may be bound, affected or in any way injured in his person or prop- erty; or, 3. Makes or engraves a plate in the form or similitude 333 Penal Code of the of a promissory note, bill of exchange, bank note, draft, cheque, certificate of deposit, or other evidence of debt, issued by a banker, or by any banking corporation or as- sociation, incorporated or carrying on business under the laws of the state, or of the United States, or of any other state or territory of the United States, or of any foreign government or country, without the authority of such banker, or banking corporation or association; or. Without like authority, has in his possession or custody such a plate, with intent to use, or permit the same to be used, for the purpose of taking therefrom any impression to be uttered; or, Without like authority, has in his possession or custody any impression taken from such a plate, with intent to have the same filled up and completed for the purpose of being uttered; or. Makes or engraves, or causes to be made or engraved, upon any plate, any figures or words, with intent that the same may be used for the purpose of falsely altering any evidence of debt hereinbefore mentioned. Title XV, Chapter III, Penal Code. Quaiiflca- § 513. A plate, specified in the last section, is in the last sec form and similitude of the genuine instrument imitated, if the finished parts of the engraving thereupon resemble and conform to similar parts of the genuine instruments. Title XV, Chapter III, Penal Code. Other oases § 513. An instrument partly written and partly printed, in second or wholly printed with a written signature thereto, and any signature or writing purporting to be a signature of, or in- tended to bind an individual, a partnership, a corporation or association, or an oflBcer thereof, is a written instrument or a writing, within the provisions of this chapter. Title XV, Chapter III, Penal Code. Offloera § 514. A person who either, sons^*"^" 1. Being an officer or in the employment of a corporation, of forgery association, partnership or individual falsifies, or unlaw- d° gree. fully and corruptly alters, erases, obliterates or destroys any accounts, books of accounts, records, or other writing, be- State of New York. 333 longing to or appertaining to the business of the corpora- tion, association^ partnership, or individual ; or 2. Who, with intent to injure or defraud, shall falsely make, alter, forge or counterfeit, shall cause, aid, abet, assist or otherwise connive at, or be a party to, the making, altering, forging or counterfeiting of any letter, telegram, report or other written communication, paper or instru- ment, by which making, altering, forging or counterfeiting, any other person shall be in any manner injured in his good name, standing, position or general reputation; or 3. Who shall utter, or who shall cause, aid, abet or other- wise connive at, or be a party to, the uttering of any letter, telegram, report or other written communication, paper or instrument, puporting to have been written or signed by another person, or any paper purporting to be a copy of any such paper or writing where no original existed, which said letter, telegram, report or other written communica- tion, paper or instrument, or paper purporting to be a copy thereof, as aforesaid, the person uttering the same shall know to be false, forged or counterfeited, and by the utter- ing of which the sentiments, opinions, conduct, character, prospects, interests or rights of such other person shall be misrepresented or otherwise injuriously affected. Is guilty of forgery in the third degree. (As amended by chapter 378, Laws of 1884.) Title XV, Chapter III, Penal Code. 8 515. A person who, with intent to defraud or to con- otheroaaes , , • • X- 1 J! of forgery ceal any larceny or misappropriation by any person of any in third money or property, either, 1. Alters, erases, obliterates, or destroys an account, book of accounts, record, or writing, belonging to, or appertain- ing to the business of, a corporation,, association, public office or officer, partnership, or individual ; or, 3. Makes a false entry in any such account or book of accounts ; or, 3. Willfully omits to make true entry of any material particular in any such account or book of accounts, made, written, or kept by him or under his direction; Is gnilty of forgery in the third degree. Title XV, Chaper III, Penal Code. 334 Pekal Code of the Officer o£ 8 518. An officer, asreiit or other person employed by any corpora- ^ ' ,? ■ .■ a ^1, 1 /xi,- tion sell- company or corporation existing under the laws oi this shares. " state, or of any other state or territory of the United States, or of any foreign government, who willfully and with a design to defraud, sells, pledges or issues, or causes to be sold, pledged or issued, or signs or procures to be signed with intent to sell, pledge or issue, or to be sold, pledged or issued, a false, forged or fraudulent paper, writ- ing or instrument, being or purporting to be a scrip, cer- tificate or other eyidence of the ownership or transfer of any share or shares of the capital stock of such company or corporation, or a bond or other evidence of debt of such company or corporation, or a certificate or other evidence of the ownership or of the transfer of any such bond or other evidence of debt, is guilty of forgery in the third de- gree, and upon conviction, in addition to the punishment prescribed in this title for that offense, may also be sen- tenced to pay a fine not exceeding three thousand dollars. Title XT, Chapter III, Penal Code. § 519. The false making or forging of an instrument or dicating writing, purporting to have been issued by or in behalf of corporate a Corporation or association, state or government, and bear- ing the pretended signature of any person, therein falsely indicated as an agent or officer of such corporation, is forgery in the same degree, as if that person were in truth such officer or agent of the corporation or association, state or government. Title XV, Chapter III, Penal Code. § 538. A person who, with the intent to deprive or de- defined, fraud the true owner of his property, or of the use and benefit thereof, or to appropriate the same to the use of the taker, or of any other person, either, 1. Takes from the possession of the true owner, or of any other person ; or obtains from such possession by color or aid of fraudulent or false representation or pretense, or of any false token or writing ; or secretes, withholds, or ap- propriates to his own use, or that of any person other than the true owner, any money, personal property, thing in ac- State of New York. 335 tion, evidence of debt or contract, or article of yalue of any kind ; or, 2. Having in his possession, custody, or control, as a bailee, servant, attorney, agent, clerk, trustee, or officer of any person, association, or corporation, or as a public officer, or as a person authorized by agreement, or by com- petent authority, to hold or take such possession, custody, or control, any money, property, evidence of debt or con- tract, article of value of any nature, or thing in action or possession, appropriates the same to his own use, or that of any other person other than the true owner or person entitled to the benefit thereof ; Steals such property, and is guilty of larceny. Title XV, Chapter IV, Penal Code. § 529. A person who willfully, with intent to defraud, obtaining by color or aid of a cheque or draft, or order for the pay- property ment of money or the delivery of property, when such per- lent draft, son knows that the drawer or maker thereof is not entitled to draw on the drawee for the sum specified therein, or to order the payment of the amount, or delivery of the prop- erty, although no express representation is made in reference thereto, obtains from another any money or property, is guilty of stealing the same and punishable accordingly. Title XV, Chapter IV, Penal Code. § 568. If the false token, by which money or property is Obtaining obtained in violation of sections five hundred and sixty-six evidence -, ^ 1 -I -I -, ■ , ■ ■ •'of debt by and five hundred and sixty-seven, is a promissory note or false pre- other negotiable evidence of debt purporting to be issued by or under the authority of any banking conipany or cor- poration not in existence, the person guilty of such cheat is punishable by imprisonment in a state prison not ex- ceeding seven years, instead of by the punishment pre- scribed in those sections. Title XV, Chapter VI, Penal Code. § 569. The use of a matured cheque, or other order for using false the payment of money, as a means of obtaining a signature, Srder'fo'r^ or money or property, such as is specified in sections five of n^nly. hundred and sixty-six and five hundred and sixty-seven, stock of corpora- tions. 336 Penal Code of the by a person who knows that the drawer thereof is not en- ' titled to draw for the sum specified therein, upon the drawee, is the use of a false token within the meaning of those sections, although no representation is made in re- spect thereto. Title XV, Chapter VI, Penal Code. Fraud in § ^^^- -^ person who signs the name of a fictitious per- ti"ons'"for ^°^ ^^ ^^J Subscription for, or agreement to take, stock in any corporation, existing or proposed; and a person who signs, to any subscription or agreement the name of any person, knowing that such person does not intend in good faith to comply with the terms thereof, or under any under- standing or agreement, that the terms of such subscription or agreement are not to be complied with or enforced, is guilty of a misdemeanor. Title XV, Chapter XI, Penal Code. Fraudu- 8 591. An officer, agent or other person in the service of lent issue ° -^ o a. of stock, anv joint-stock company, or corporation formed or existing under the laws of this state, or of the United States, or of any state or territory thereof, or of any foreign govern- ment or country, who willfully and knowingly, with intent to defraud, either, 1. Sells, pledges or issues, or causes to be sold, pledged, or issued, or signs or executes, or causes to be signed or executed, with intent to sell, pledge, or issue, or cause to be sold, pledged or issued, any certificate or instrument purporting to be a certificate or evidence of the ownership of any share or shares of such company or corporation, or any bond or evidence of debt, or writing purporting to be a bond or evidence of debt of such company or corporation, without being first thereto duly authorized by such com- pany or corporation, or contrary to the charter or laws under which such corporation or company exists, or in excess of the power of such company or corporation, or of the limit imposed by law or otherwise upon its power to create or issue stock or evidences of debt; or, 2. Eeissues, sells, pledges or disposes of, or causes to be reissued, sold, pledged or disposed of, any surrendered or Statb 01' New Yokk. 337 canceled certificates, or other evidence of the transfer or ownership of any such share or shares; Is punishable by imprisonment for not less than three years nor more than seven years, or by a fine not exceeding three thousand dollars, or by both. Title XV, Chapter XI, Penal Code. § 592. An officer, agent or clerk, of a corporation, or of ji^auds in persons proposing to organize a corporation, or to increase ^Jganfza? the capital stock of a corporation, vi^ho knowingly exhibits poration""^' a false, forged or altered book, paper, voucher, security ° J ^°®J®|f^ or other instrument of evidence to any public officer or board authorized by law to examine the organization of such corporation, or to investigate its affairs, or to allow an increase of its capital, with intent to deceive such officer or board in respect thereto, is punishable by imprisonment in a state prison not exceeding ten years and not less than three years. Title XV, Chapter XI, Penal Code. § 593. A person who, without authority, subscribes the unautbor- name of another to, or inserts the name of another in, any names in prospectus, circular or other advertisement or announce- e3?e?o? "^ ment of any corporation or joint-stock association existing or intended to be formed, with intent to permit the same to be published, and thereby to lead persons to believe that the person whose name is so subscribed is an officer, agent, member or promoter of such corporation or association, is guilty of a misdemeanor. Title XV, Chapter XI, Penal Code. § 594. A director of a stock corporation, who concurs in Misoon- , J! 1 •, • duct of di- any vote or act of the directors of such corporation, or any rectors of .,, , ,.,.,..,., ^ ■' stock cor- 01 them, by which it is intended, porations. 1 . To make a dividend, except from the surplus profits arising from the business of the corporation, and in the cases and manner allowed by law; or, 2. To divide, withdraw, or in any manner pay to the stockholders, or any of them, any part of the capital stock of the corporation; or to reduce such capital stock without the consent of the legislature; or, 43 338 Penal Code of the 3. To discount or receive any note or other evidence of debt in payment of an installment of capital stock actually called in, and required to be paid, or with intent to provide the means of making such payment; or, 4. To receive or discount any note or other evidence of debt with intent to enable any stockholder to withdraw any part of the money paid in by him on his stock; or, 5. To apply any portion of the funds of such corpora- tion, except surplus profits, directly or indirectly, to the purchase of shares of its own stock; or, 6. To receive any such shares in payment or satisfaction of a debt due to such corporation; or, 7. To receive in exchange for the shares, notes, bonds, or other evidences of debt of such corporation, shares of the capital stock or notes, bonds or other evidences of debt issued by any other stock corporation; Is guilty of a misdemeanor. Title XV, Chapter XI, Penal Code. Miaoon- § 595. A director of a corporation, organized under the directors laws of this stato, having banking powers, who concurs in oorpOTa-"^ any vote or act of the directors of such corporation, or any of them, by which it is intended, either, 1. To make a loan or discount, by which the whole amount of the loans and discounts of the corporation shall be greater than the amount allowed by law, or, where there is no express statutory limitation of the amount greater than three times its capital stock then paid in and actually possessed; or, 2. To make a loan or discount to any director of such corporation, or upon paper upon which any such director is responsible to an amount exceeding the amount allowed by statute, or where there is no express statutory limita- tion of the amount, exceeding in the aggregate one-third of the capital stock of such corporation then paid in and actually possessed; Is guilty of a misdemeanor. Title XV, Chapter XI, Penal Code. Loans § 596. Nothing in the last section shall render any loan viofau'on made by the directors of any such corporation, in violation siction not thereof, invalid. Invalid. ^.^j^ ^^^ Chapter XI, Penal Code. State of New Yokk. 339 § 597. An officer or agent of any corporation having saie or hy- bankmg powers, who sells or causes or permits to be sold, tion of any bank notes of such corporation, or pledges or hypothe- by officer, cates, or causes or permits to be pledged or hypothecated, with any other corporation, association or individual, any such notes, as a security for a loan or for any liability of such corporation, is punishable by imprisonment in a county jail not exceeding one year, or by a fine not exceeding five thousand dollars, or both. Title XV, Chapter XI, Penal Code. §598. An officer or agent of any corporation having officer of hanking powers, who issues or puts in circulation, or causes ,ing excea- bank put- ting exces- sive Dum- or permits to be issued or put in circulation, the bank notes ber o£ its of such corporation to an amount which, together with oiroulia" previous issues, leaves in circulation or outstanding a*°°" greater amount of notes than such corporation is allowed by law to issue and circulate, is punishable by imprison- ment in a county jail not exceeding one year, or by a fine not exceeding five thousand dollars, or both. Title XV, Chapter XI, Penal Code. § 599. An officer or agent of any banking corporation, officer or who makes or delivers any guaranty or indorsement on be- banking half of such corporation, whereby it may become liable tkmmak- upon any of its discounted notes, bills or obligations, in a ty or in- sum beyond the amount of loans and discounts which such ment, in corporation may legally make, is guilty of a misdemeanor, in certain ' C&S6S. Title XV, Chapter XI, Penal Code. 8 600. An officer, agent, teller or clerk of any bank, Bank offi- ° ' ^ ' J ' cer over- banking association or savings bank, who knowingly over- drawing draws his account with such bank, and thereby wrongfully oou"*- obtains the money, notes or funds of such bank, is guilty of a misdemeanor. Title XV, Chapter XI, Penal Code. § 601. An officer, agent, teller or clerk of any bank, Beceiying banking association or savings bank, and every individual fnl'o'iveQt" banker or agent, and any teller or clerk of an individual '**°''" banker, who receives any deposits knowing that such bank. 340 Pekal Code of the or association, or banker is insolvent, is guilty of a misde- meanor. Title XV, Chapter XI, Penal Code. Frauds in § 603. A director, officer or agent of any corporation or aooountfl, joint-stock association, who knowingly receives or possesses himself of any property of such corporation or association, otherwise than in payment of a Just demand, and with in- tent to defraud, omits to make, or to cause or direct to be made, a full and true entry thereof, in the books or ac- counts of such corporation or association ; and a director, oflBcer, agent or member of any corporation or joint-stock association, who, with intent to defraud, destroys, alters, mutilates or falsifies any of the books, papers, writings or securities belonging to such corporation or association, or makes or concurs in making any false entry, or Omits or concurs in omitting to make any material entry in any book of accounts, or other record or document kept by such corporation or association, is punishable by imprisonment in a state prison not exceeding ten years; and iiot less than three years, or by imprisonment in a county jail not exceed- ing one year, or by a fine not exceeding five hundred dol- lars, or by both such fine and imprisonment. Title XV, Chapter XI, Penal Code. § 603. A director, ofificer or agent of any corporation or joint-stock association, who knowingly concurs in making or publishing any written report, exhibit or statement of its afEairs or pecuniary condition, containing any material statement which is false, other than such as are elsewhere, by this Code, specially made punishable, is guilty of a mis- demeanor. Title XV, Chapter XI, Penal Code. § 604. The insolvency of a moneyed corporation is ofe^a'oi cor- deemed fraudulent unless its affairs appear, upon investi- deeuied" ^ gation, to have been administered fairly, legally, and with lent, when, the Same care and diligence that agents receiving a com- pensation for their services are bound by law to observe. Title XV, Chapter XI, Penal Code. Officer of corpora- tion pub- lishing false re- ports of its condi- tion. State of New York. 341 § 605. In every case of the fraudulent insolvency of a Directors ° •[. ■' participat- moneyed corporation, every director thereof who partici- ing in pated in such fraud, if no other punishment is prescribed insoiven- theref or by this Code, or any special statute, is guilty of a punish- misdemeanor. Title XV, Chapter XI, Penal Code. § 606. A director of any moneyed corporation, who will- violation fully does any act, as such director, which is expressly for- directors bidden by law, or willfully omits to perform any duty ex-edcorpora- pressly imposed upon him as such director, by law, tne punishment for which act or omission is not otherwise pre- scribed by this Code, or by some special statute, is guilty of a misdemeanor. Title XV, Chapter XI, Penal Code. (Sections 607 and 608 were repealed by chapter 377, Laws 1884.) 8 609. A director of a corporation or ioint-stock associa- Directors ° r <) of corpora- tion must be deemed to have such a knowledge of the af- *i°" R^e- ° sumed to fairs of a corporation or association as to enable him to knowledge determine whether any act, proceeding or omission of its J^jJ,^^ ^*- directors, is a violation of this chapter. Title XV, Chapter XI, Penal Code. § 610. A director of a corporation, or joint-stock associa- Director tion, who is present at a meeting of the directors, at which meeting,^* any act, proceeding or omission of such directors in viola- ^metf to" tion of this chapter occurs, must be deemed to have con- selii^ed^to curred therein, unless he at the time causes, or in writing fnga.*^ ' requires, his dissent therefrom to be entered in the minutes of the directors. Title XV, Chapter XI, Penal Code. § 611. A director of a corporation, or joint-stock associa- Director tion, although not present at a meeting of the directors, at from meet- which any act, proceeding or omission of such directors, in presumed violation of this chapter, occurs, must be deemed to have assentod to pro- concurred therein, if the facts constituting such violation oeedings. appear on the record or minutes of the proceedings of the board of directors, and he remains a director of the same 342 Penal Code of the State of New Yoek. Failure of director upon Whom ap- plication is served, etc. Foreign corpora- tions. " Direc- tor " de- fined. company for six months thereafter, without causing, or in writing requiring, his dissent from such illegality to be en- tered in the minutes of the directory. Title XV, Chapter XI, Penal Code. § 612. A director, trustee or other ofiBcer of a joint-stock association or corporation, upon whom a notice of applica- tion for an injunction affecting the property or business of such joint-stock association or corporation is served, who omits to disclose to the other directors, oflScers, or managers thereof, the fact of such service, and the time and place of such application, is guilty of a misdemeanor. Title XV, Chapter XI, Penal Code. § 613. It is no defense to a prosecution for a violation of , the provisions of this chapter, that the corporation was one created by the laws of another state, government or country, if it carried on business, or kept an office therefor, within this state. Title XV, Chapter XI, Penal Code. § 614. The term "director," as used in this chapter, em- braces any of the persons having by law the direction or management of the affairs of a corporation by whatever name such persons are described in its charter, or are known in law. Title XV, Chapter XI, Penal Code. OFFICIAL OPINIONS BT THE ATTORNEY- GENERAL ou tlie Constractioii to be given to Statutes of lliis State RELATING TO SAYIN&S BANKS, BANKS, BANKING AND TRDST COMPANIES. SAYINGS BANES. POWER OF BANK SUPERINTENDENT TO INTERFERE WHERE TRUSTEES OF SAVINGS BANKS ARE IN- DULGING IN UNLAWFUL PRACTICES, CONFINED TO MATTERS THEN BEING CARRIED ON. STATE OP NEW YOEK ICE OF THE A Albany, December 31, 1877. Office of the ATTOENBY-GtBNEBAi, ) Hon. Henkt L. Lamb, Acting Superintendent of the Banh Department : Dear Sir — In regard to the matter of the Oneida Savings Bank, I do not think the law now gives you any power to interfere. The powers given by the act of 1875 are confined to a proceeding under the 23d and 44th sections. 1. By those sections you are authorized to interfere either when the managers of the bank are indulging m practices which you may disapprove of, for reasons given in the laws. In that case the remedy is to stop such practices, and it necessarily is confined to matters then being carried on. 2. The other case contemplated by the act is when you consider it unsafe or inexpedient for the corporation to continue business. In that case you close it entirely. Neither case is presented in the present instance. Nothing is presented under the first head, because the matters complained of occurred many years ago. Nothing under the second head, because, as I understood you, the bank is now solvent and properly conducted. I may add that the only conceivable remedy — the turning out of the present managers and putting the bank into new hands, which suits might be brought against the present trustees presumably to recover for the loss — would be ineffectual ; for the statute of limi- tations has long run against any such suits. Eespectfully, B. W. PAIGE, Deputy Attorney- General 44 346 Opiitioks by the Attokney-Gbneeal. DEPOSITS WITH SAVIWaS BANKS NOT LIABLE TO TAXATION. STATE OF NEW YORK : Office of thb Attorney-Genekai, ) Albany, June 12, 1878. ) J. Gr. Benedict, Esq. : Dbae Sie — In answer to yonr communication of the 3d inst., inquiring whether a depositor in a savings bank is liable to be assessed and taxed for his deposit, I have the honor to say that, in my opinion, section 4 of chapter 456 of the laws of 1857, exempts such deposits absolutely from taxation, and a depositor cannot, therefore, be assessed for such moneys. The law above mentioned, in my opinion, protects the individual depositor as well as the bank. Very respectfully yours, A. SCHOONMAKEE, Je., A ttorney- General. AUTHORITY FOB PAYMENT OF INTEREST ON DEPOSITS WITHDRAWN DURING THE LAST THREE DAYS OF AW INTEREST PERIOD CONFINED TO SAVINGS BANKS DECLARING DIVIDENDS SEMI-ANNUALLY, AND IS NOT APPLICABLE TO SAVINGS BANKS PAYING IN- TEREST QUARTERLY. STATE OP NEW YORK : Office of the Attoknet-General, ) Albany, July 3, 1878. ) Hon. Heney L. Lamb, Acting Superintendent of the Bank Department : Dbae Sir — In answer to yours of July 1st inst., I have the honor to say, that in my opinion a savings bank can lawfully pay interest on deposits withdrawn on any of the last three days of a semi-annual interest or dividend period, for the length of time the money has actually been on deposit since the last preceding dividend. For example, if the dividend periods be January 1st and July 1st, inter- est may be paid on deposits withdrawn on any of the three last days of June or December, if the deposits have been held the length of time required by section 33 of the act of 1875. In case of quarterly payment of dividends by a bank, I think the same rule does not apply, and that a withdrawal of the deposit before the end of the Savings Banks. 347 quarterly interest period forfeits the right to interest. Section 33, before referred to, seems to contemplate only semi-annual payments of interest, and its provisions in reference to the withdrawal of deposits on the last three days have reference solely to such semi- annual payments. I am also of opinion that when deposits are withdrawn before the end of a quarterly dividend period, or more than three days before the end of a semi-annual dividend period, a savings bank cannot lawfully pay interest on such deposits. I think payment of inter- est in such cases is plainly and clearly prohibited by the statute, and that the prohibition is founded upon sound principles of bank- ing. It is a necessary measure of jjrotection to savings banks. They would be very much at the mercy of transient depositors, under a rule allowing interest on deposits withdrawn at any time. Very respectfully, A. SOHOONMAKEE, Jr., Attorney- General. PERSONS WHO DIRECTLY OR INDIRECTLY SUSTAIN THE RELATION OF DEBTOR TO A SAVINGS BANK ARE INELIGIBLE AS TRUSTEES. STATE OF NEW YORK : Office of the Attornbt-Gbnbral, ) Albany, April 4, 1879. j Hon. Heney L. Lamb, Acting Superintendent of the Bank Department : Deak Sie — In answer to your communication calling my atten- tion to several inquiries made by trustees of savings banks, whether a person who directly or indirectly sustains the relation of debtor to a savings bank, whether as owner of real estate upon which a mortgage is held by the bank, or as obligor upon any kind of instru- ment securing a loan by a bank, or one who has interests with a borrower from, or a debtor to, a bank, which might conflict with strict and paramount fidelity to the bank, is eligible to the office of trustee under the provisions of the savings bank statutes of this State, I have the honor to say that, in my opinion, the object of the statute is to secure disinterested management of savings insti- tutions solely in the interest of depositors, and that to this end no circumstance should exist inconsistent with the fiduciary relation of the trustee to his trust. 348 Opinions by the Attorney Genekaj.. The policy of the statute is to exclude absolutely from the man- agement of savings bank trusts all persons who have any pecuniary relations with a bank, or with a borrower from a bank, which might induce a lack of vigilance as trustee, or antagonize duty by private interest. This is equally a rule of reason, and experience has too frequently shown that where official duty and personal interest come in conflict, the former is likely to suffer. The only rale of safety, therefore, for all cases in the different forms in which they may arise, is to adhere rigidly to the poUcy indicated by the statute, to deem as ineligible for the position of trustee or officer of a savings bank all persons who have any pecu- niary interest, whether as owner of property subject to mortgage held by the bank, or as borrower, guarantor, or partner of a debtor to a bank, which may influence in any degree the performance of official duty. Strict enforcement of this rule may occasionally exclude a good man from such trust, but like results are incident to all general rules of public policy, and the number of improper men excluded will be much greater. The statute applies practically the principle that no man can faithfully serve two masters. Very respectfully yours, A. SOHOONMAKEE, Jr., A ttorney- General, FATLUBE BY A TBUSTEE OF A SAVINGS BAITK TO PEBFOBM COMMITTEE DUTIES TO WHICH HE HAS BEEN EEGULABLY ASSIGNED, FOB THE PEEIOD OP SIX MONTHS, VACATES HIS OFFICE AS TBUSTEE. STATE OP NEW YORK : Officb of the Attobnby-Gknbral, 1 Albany, May 13, 1879. ) Hon. Henry L. Lamb, Acting Superintendent of the Banking Department: Dear Sir — In answer to your communication inquiring whether a failure by a trustee of a savings bank to perform any committee duties to which he has been regularly assigned by the board of trus- tees, for a period of six months, vacates his office as trustee, I have ■ the honor to say, that, in my opinion the consequences of a failure to perform committee duties are the same as a failure to attend the regular meetings for six successive months. In either case, the Ian- Savings Bakes. 349 guage of the statute is " the office of such trustee shall immediately become vacant/' By section 17 of the act of 1875 (chap. 371) boards of trustees have power, among other things, "for the appointment and duties of committees." Section 19 declares that the office becomes vacant upon the failure of a trustee "to per- form any of the duties devolved upon him as such trustee for six successive months without having first been excused by the board for such failure." Committee duty is a duty devolved upon a trustee as such, by the board, and in pursuance of law. If a trustee attends no meetings, or performs no committee duties for six successive months his office becomes ipso facto vacant. Ifeglect to perform duties, is equivalent to a refusal to serve, and a continuance of such neglect for six months is in the purview of the statute a permanent refusal to serve. The law requires active fidelity in the execution of such trusts, and does not tolerate passive indifference. Very respectfully yours, A. SCHOONMAKEE, Je., Attorney- General. THE POWERS, DUTIES AND LIABILITIES OE TEUSTEES OP SAVINGS BAIIKS DEFINED. STATE OF NEW YORK : Office of thb Attornbt-Gbnerax, 1 Albakt, July 16, 1879. J Hon. HEiirET L. Lamb, Acting Superintendent of the Banking Department : Deae Sie — I have the honor to acknowledge the receipt of your communication of July 4th inst., referring to certain practices in divers savings banks, and requesting the opinion of the attorney- general upon several points specifically submitted. It is a settled rule of law that the powers of corporations are limited by the acts creating them. Being artificial creatures they have only such powers as are granted for the purposes of their crea- tion. Trustees of corporate bodies can only exercise the powers granted to the corporation they represent. Their office is a trust and their duty is to execute the trust conferred upon them; and the duties imposed are the measure of their powers. Trustees acquire no interest in, or authority in respect to, the trust property, personal 350 OpiNIOlfS BY THE ATTOENET-GEiq-EEAL. to themselves, nor any power over it beyond the charter or statutes under which they act. The courts have been rigid in enforcing these jorinciples, and in holding trustees to personal accountability for abuses of their trust, in assuming the exercise of powers not conferred, in the waste or illegal application of trust funds or property and in restraining corporations to authorized acts. The court of appeals, upon this subject, uses the following explicit language : " The public are interested ia restraining corporations to the enjoy- ment of the precise franchise granted, and the exercise of the powers expressly conferred, and the incidental powers essential to the ex- press power. Shareholders are also interested in keeping their trus- tees, the governing boards, within the limits of the delegated power with which they are clothed. It is axiomatic that a corporation can make no contracts and do no acts except such as are authorized by its charter, either expressly or as incidental to its existence. Cor- porations necessarily depend, both for their powers and the mode of exercising them, upon the construction of the statute which gives them life and being." (60 N. Y. 294.) By the act relating to savings banks (chap. 371, Laws of 1875), the powers of savings banks and their trustees are clearly defined, and their powers are limited to those expressed in the statute. Every trustee of a savings bank takes his position subject to the limitations of the statute and to the duties it imposes. By this statute savings banks have power " to receive money oii deposit, to invest the same and further transact the business of a savings bank as hereinafter provided." (Sec. 1, sub. 7.) By section 36 the manner in which savings banks may invest the moneys deposited therein is particularly prescribed. Section 27 authorizes a limited percentage of deposits to be kept on hand for current payments and expenses, and for violating "the spirit and intent " of this provision the superintendent, by section 28, is re- quired to report the bank to the attorney-general, to be proceeded against for mismanagement. By section 23 the sums deposited, together with any dividends or interest credited thereto, are required to be repaid to the depositors, after demand and notice. The trust, as thus defined by law, is to receive deposits, to in- vest them only in the manner prescribed, and to return the princi- pal and interest to the depositor. The whole fund is protected by careful provisions of law. For the purpose of executing this trust, every bank is required to have a board of trustees of not less than Savings Banks. 351 thirteen, who must elect from their number a president and two vice-presidents, and also elect or appoint from their number, or otherwise, such other officers as they may see fit (sec. 16) ; and the trustees, acting as officers of the corporation, whose duties require and receive their regular and faithful attendance at the institutiou, are authorized to receive such compensation as, in the opinion of a majority of the board of trustees, shall be just and reasonable; such majority to be exclusive of any trustee to whom such compensation shall be given. And trustees are prohibited from receiving pay as trustees for their attendance at meetings of the board. In addition to the compensation of officers, clerks and attorneys, expenditures may be lawfully made from the income, for the inci- dental and necessary expenses of the institution, such as furniture, rents, taxes, fuel, light, stationery, watchmen, and whatever may be requisite for the proper management of the trust property and its protection. Expenditures for those purposes fall within the le- gitimate duties of the trust; but neither the deposits nor their in- come can be lawfully used or expended for other purposes. They cannot be used "to pay trustees compensation for services upon committees; " nor " the chairman of a regular standing committee for services as trustee in acting as such chairman; " nor " to pay for an annual supper or entertainment for the trustees; " nor "to pay for a service of plate donated to a local organizer of a railroad en- terprise;" nor "to make contributions" for charitable, benevolent or sanitary objects; nor to make "gratuitous appropriations to the widows of deceased officers; " nor " to pay costs and expenses to get bills through the legislature to pay interest" on illegal loans; nor to make "gratuities to officers for past services, who had been paid regular salaries; " nor to lobby agents " to procure general legislation relative to savings banks." Payments from the money of depositors for all such purposes are clearly illegal, and render the trustees who authorize or consent to them personally liable for the diversion of the funds. It is undoubtedly the duty of the superintendent of the bank de- partment to require the restitution of the funds misappropriated or unlawfully diverted by the trustees of a savings bank, and in case of failure to make restitution to report the facts to the attorney- general that proceedings may be instituted for their recovery, ac- cording to law. Nor is there any doubt that the misuse of the funds or their illegal expenditure by the trustees, and a refusal to make restitution constitute such abuses of trust as to furnish ground 352 Opinions by the Attornet-GtEneral. for the removal of the culpable trustees under the provisions of chapter 433 of the Laws of 1879, and the Kevised Statutes. The statutes of limitations have no proper application to cases of trusts, but the liability of trustees, for illegal appropriation of trust funds, continues while the trust relation exists. If proper proceed- ings are delayed unreasonably after the relation ceases, recovery will be barred by lapse of time. The foregoing, I believe, covers all the inquiries made by your communication. Very respectfully yours, A. SOHOOFMAKEE, Jr., A ttorney- General. TTNLAWPUL TOE. SAVINGS BANKS TO PURCHASE EEAL ESTATE FOE THE PURPOSE OF ERECTING BUILDINGS THEREON TO RENT. STATE OF NEW YORK: Office of the Attorney-General, ) Albany, September 26, 1879. ) Hon. Henry L. Lamb, Acting Superintendent of the Banh Department : Dear Sir — In answer to the inquiries contained in your com- munication of August 18th last, I have the honor to say: 1. That, in my opinion, a savings bank can only purchase and hold, real estate (other than such as may be bought in at foreclosure sales) necessary for a banking building. The statute declares that " it shall be lawful for any such corporation to purchase, hold or convey real estate only as follows: 1st. A plot whereon is erected, or may be erected, a building or buildings requisite for the conven- ient transaction of its business, and from portions of which, not required for its own use, a revenue may be derived." (Sec. 39.) It is very clear that, under this statute, it is not lawful for a savings bank to purchase adjoining property, upon the theory of protecting its vaults, nor for the purpose of erecting and renting buildings thereon. A bank should, of course, own a lot large enough for the safety and security of the building and vaults, and no definite rule can be laid down on that subject; but the trustees should exercise a prudent discretion. 3. In respect to purchases at foreclosure sales, and conveyances to the bank in settlement of mortgages, or other debts due the Savings Banks. 353 bank, I am of opinion that the amount which should be reported as invested in real estate, so acquired, should be the face of the loan or debt liquidated by the conveyance' with the accrued interest, and any costs attending the acquisition of title. This should be regarded as the rule in all cases, unless other pay- ments or other securities are received by the bank, and in such cases the amount of such payments or securities would diminish the investment in real estate to that extent. Very respectfully yours, A. SOHOONMAKER, Jk., A ttorney- General MINIMUM NUMBER OF TRUSTEES REQUIRED FOR SAV- INGS BANKS. STATE OF NEW YOHK: ;b of the At Albany, May 3, 1880. Office of the Attobnet-Genbral, ) Hon. A. B. Hepburn, Sujjerintendeni of the Banking Department : Deab Sib — ^Your commuuication of April 39th ult., is at hand, in which you state that the trustees of the Goshen Savings Bank, chartered by chapter 402 of the Laws of 1871, assuming to act under section 50 of chapter 371, Laws of 1875, known as the Gen- eral Savings Bank Law, have, by a resolution of said board of trustees, duly adopted, increased the number of trustees to nine, their charter number being seven. And you ask, " are not savings banks, by said chapter 371 of the Laws of 1875 and amendatory acts, required to increase the number of trustees to at least the minimum therein provided, viz., thirteen?" And you inquire further whether the superintendent of the banking department can lawfully approve a proposed increase of the members of a board of trustees of any savings bank to a number less than the minimum fixed by law of 1875, to-wit, thirteen ? In reply, I have the honor to state that I have carefully examined the provisions of the General Savings Bank Act (chap. 371, Laws of 1875) and other statutes bearing upon the subject of your in- quiry, and am of opinion that section 16 of that act, which fixes the minimum number of trustees at thirteen, has reference only to savings banks organized under the provisions of said act of 1875. The language of the section is: "The business of every such cor- 45 •354 Opinions by the Attoenbt-Gbneeal. poration shall be managed and directed by a board of trustees of not less than thirteen." The words " such corporation " manifestly refer to the corporation which the preceding sections provide for organizing, namely, new savings banks. Section 50 of the act in question applies to both classes of savings corporations, those pre- viously organized and those organized under the act of ]875, and provides that it shall be lawful for the board of trustees of any savings corporation * * * to reduce the number of trustees named in the original charter of such corporation to a number not less than the minimum named in this act * * * or the number of trustees may be increased to any number designated in a resolution for that purpose, where reasons therefor are shown to the satisfaction of the superintendent, and his consent in writing obtained thereto. It will be observed that while the right to de- crease down to the minimum, thirteen, is absolute, the right to increase to any number is subject to the condition that reasons therefor must be shown to the satisfaction of the superintendent, and his consent in writing be obtained thereto. This seems to me to indicate very plainly that the legislature, in the act of 1875, while fixing a minimum of thirteen for corporations organized under its provisions, also recognized the fact that other savings banks existed, under charters previously granted, with a less num- ber of trustees than thirteen, which it did not intend to disturb in this particular, and that it regarded it entirely safe and proper to leave the matter of the increase in the number of trustees of both classes of savings corporations, to be regulated by the sound dis- cretion of the superintendent. I am of opinion, therefore, that the Goshen Savings Bank may lawfully increase the number of its trustees from seven to nine, subject to such approval and consent of the superintendent, and that he may lawfully approve of and consent to the same, if the reasons therefor appear to him satisfactory. •Very respectfully yours, W. B. EUGGLES, First Deputy Attorney-General. Savings Banks. 355 ITNLA'WTUL FOR SAVINGS BANKS TO PTJECHASE THE FIVE PER CENT BONDS ISSUED BY THE DISTRICT OP COLUMBIA. STATE OF NEW YORK: Office of the Attornby-Genbkal, ) Albany, March 29, 1881. ) Hon. A. Bakton Hepbtjen', Superintendent of the Banking Department : Dear Sir — Yours of the 26th inst., enclosing a letter fi-om Isaac B. Noxon, secretary Sing Sing Savings Bank, dated February 20, 1881, and requesting an opinion whether the savings banks of this State are authorized to invest in five per cent bonds of the District of Columbia, issued under the act of Congress approved June 10th, 1879, is at hand. In reply, I have the honor to state that if such investment can be legally made, it must be under the provisions of the first subdivision of section 26 of the act chapter 371 of the Laws of 1875 as amended by chapter 287 of the Laws of this State for 1880, whereby it is provided that it shall be lawful for the trustees of any savings bank to invest the moneys deposited therein only as follows, namely: ' ' First in the the stock or bonds or interest-bearing notes or ob- ligations of the United States, or those for which the faith of the United States is pledged to provide for the payment of the interest and principal, including the bonds of the District of Columbia commonly known as the three sixty-five bonds." The bonds in question are not within the description of the District of Columbia bonds above designated. Nor are these five per cent bonds " the stocks or bonds or interest-bearing notes or ob- ligations of the United States, or those for which the faith of the United States is pledged to provide for the payment of the interest and principal.'" On the contrary, the act of Congress of June 10, 1879, above referred to, under which said bonds were issued, con- tains an express provision as follows: "Provided, that this act shall not be construed to make the government of the United States liable for either principal or interest of said bonds, or any part thereof." I am, therefore, of the opinion that the trustees of savings banks, organized under the laws of this State, cannot legally invest the 356 Opinions by the Attornet-Geneeal. moneys deposited in said banks in said five per cent bonds of the District of Columbia. Very respectfully yours, HAMILTON WAKD, Attorney- General. UNLAWFUL FOB, SAVINGS BANKS OF THIS STATE TO DELEGATE THEIR POWERS. STATE OF NEW YORK: Office of the Attorney-Genekal, ) Albany, January 11, 1883. ) Hon. A. B. Hepburn", Superintendent of the Banking Department : Dear Sir — I have the honor to acknowledge the receipt of your communication of the 9th inst., enclosing a contract between a National bank and a savings bank in this State, and asking my opinion upon the following propositions in relation thereto: 1. Have the savings banks of this State power to enter into a contract of this nature? 2. Does not the contract amount to a delegation of trust powers? 3. Have savings banks' trustees the power to provide for the in- vestment and management of moneys received on dejDosit in any other way than by themselves and officers immediately employed by them and directly accountable to them? 4. After trustees of savings banks have invested the moneys re- ceived on deposit are they not accountable to depositors for the ac- tual proceeds of such investment? 5. Have they the right to sell or bargain away such proceeds for any stipulated sum? 6. Have trustees of savings banks the right to contract with a discount bank to have the clerical work of such savings bank done by such discount bank or its employees? The contract enclosed provides that in consideration of the re- ceiving by the National bank of all the deposits, and also the in- come and interest from all the assets belonging to the savings bank, the National bank agrees with the savings bank as follows: First. To pay five per cent interest per annum on deposits in said institution, to be computed and paid in accordance with the rules of said institution with its depositors. Savings Banks. 357 Second. To pay all salaries, clerks and ofHcers of said institution and all rents, taxes and incidental expenses connected with the keeping of the account thereof. Third. To pay the interest upon the surplus fund of the savings bank at the rate of live per cent per annum, which interest shall be paid semi-annually and added to the surplus fund. The amount of the surplus fund for the purpose of computing the interest thereon is understood and agreed to be by the parties on the 1st day of July, 1876, the sum of $9,385.78, and shall hereafter be in- creased only by crediting to it all premiums which shall hereafter be saved on bonds and other securities, gold and gold drafts, sold or redeemed; but it is understood that all gold received for interest and premiums thereon shall belong to and be the property of the National bank; said surplus fund shall also be increased by credit- ing to it the difference between the price paid for the bonds or se- curities and par, when such bonds or securities shall be purchased at less than par. All premiums which shall hereafter be paid by said institution for bonds, stocks, mortgages or other securities shall be charged to and deducted from such surplus fund. Fourth. The National bank shall pay all drafts made on it by the savings bank either to pay depositors or for investments. Fifth. The National bank shall be responsible for the safe-keep- ing of the bonds or other securities and the moneys of the savings bank. Sixth. The savings bank shall bear all losses sustained on account of bad debts, depreciations and otherwise, and all expenses of liti- gation. Seventh. The contract shall take effect on the 1st day July, 1876, and continue in force for the term of two years. The savings banks of this State are governed by chapter 371 of the Laws of 1875 and the several acts amendatory thereto. By the 36th section of that act, savings banks are not permitted to invest the moneys received by them from depositors except in the follow- ing way: 1. In the stocks or bonds or interest-bearing notes or obligations of the United States, or those for which the faith of the United States is pledged. 2. In the stocks or bonds of this State bearing interest. 3. In the stocks or bonds of any State in the Union that has not, within ten years previous to making such investment by such cor- poration, defaulted in the payment of any part of either principal 358 OpISTIONS by the ATTOKNEY-GBlirERAL. or interest of any debt authorized by any legislature of such State to be contracted. 4. In the stocks or bonds of any city, county, town or village of this State issued pursuant to the authority of any law of this State or in any interest-bearing obligations issued by the city or county in which such bank is situated. 5. Any bonds and mortgages on unincumbered real estate situate in this State worth at least twice the amount loaned thereon, but not to exceed sixty per centum of the whole amount of deposit, shall be so loaned or invested. In case the real estate upon which such money is loaned shall be unimproved aud unproductive the bank shall not loan thereon to exceed forty per cent of its actual value. 6. In real estate subject to the provisions of section, 29 of that act which provides that the savings banks may purchase, hold or con- vey real estate only as follows: First. A plot whereon is erected or to be erected a building requi- site for the convenient transaction of its business, and from portions of which, not required for its own use, a revenue may be derived, the cost of the building lot not to exceed fifty per cent of the net surplus of such corporation except by written permission of the superintendent of the banking department, except where lots were purchased before the passage of the act, or where maps, plans and estimates Jiave been made for the purpose of erecting the banking building. Second. Such real estate as shall have been purchased at sale by the foreclosure of mortgages owned by the corporation or upon judg- ments obtained or re'ndered for debts due to it or in settlement effected to secure such debts. By section 30 trustees of savings banks are not permitted to loan the moneys deposited with them or any part thereof upon notes, bills of exchange, drafts or any other personal securities whatever. For the purpose of making current payments and expenses in ex- cess of the receipts, the savings banks may keep on hand an avail- able fund not exceeding ten per cent of the whole amount of the deposit, or it may deposit such funds in any bank or banking associa- tion of the State of New York, organized under the laws of the State or the United States, or with any trust company of the State; but the sum so deposited in any one bank or trust company shall not exceed twenty-five per cent of the paid-up capital and surplus of such bank or trust company; or such fund or any part thereof may be loaned upon pledge of the securities or any of them named in Savings Banks. 359 subdivisions 1, 3, 3 and 4 of section 26 of this act, but not in excess of ninety per cent of the cash market value of such securities so pledged, nor in excess of the par value thereof. A savings bank may also temporarily deposit in the banks or trust companies before named the excess of its current daily receiiots over payments until such time as the same can be judiciously invested in the securities named in section 26 of the act; but whenever it shall appear to the superintendent of the banking department that the trustees of any savings bank are violating the spirit and intent of the foregoing pro- visions by keeping permanently invested all or an undue portion of the moneys received by them in a bank or trust company, it shall be his duty to report the fact to the attorney-general, who shall proceed against such savings bank as the nature of the case may require. The savings bank cannot lawfully make a contract like the one submitted for consideration. The scheme of that contract is to pass over and surrender to the National bank all the deposits and income and interest " from all •the assets belonging to the savings bank for the period of two years." This arrangement is not valid as a deposit of the funds with the Na- tional bank, because it is not a deposit of ''ten per cent of the whole of the deposits for the purpose of meeting current payments and ex- penses in excess of the receipts," as permitted by section 27, nor is it a temporary " deposit of the excess of the current daily receipts, over the payments until such time as the same can be judiciously invested " in the securities named in section 26 as provided for by section 28; neither can it be valid as a loaning of the deposits, be- cause it would be loaning them upon securities prohibited by section 30. It cannot be valid as an investment of the deposits of the sav- ings bank, because " investments " cannot lawfully be made except in the manner pointed out by section 26. The contract is further unlawful because it gives to the National bank the surplus, if any, which would arise from the investment of the deposits. Such sur- plus within the language and the intention of section 33 belongs to the depositors, and the trustees of savings banks have no right to bargain away such surplus. The same section provides for an equitable division of such surplus, if any, among the depositors at stated times. I think the contract amounts to an attempt to delegate the trust power of the trustees. The general rules applicable to trusts apply with equal force to trustees of savings banks. The law permits such institutions to 360 Opinions by the Attofnet-General. exist as places of safe deposit for the accumulation of limited amounts. They are generally patronized by people of small means, and the law takes cognizance of that fact. It means, therefore, that savings banks shall be safe and secure, and in order to so pro- vide, it has hedged them about with the provisions of law above enumerated. The law clearly points out the path to be pursued by its officers in the discharge of their trust. Being creatures of the statute as well as trustees, the officers of such institutions are not permitted to deviate from the express rules laid down by statute for their guidance. The trust is personal to the trustees. They cannot lawfully delegate their trust powers. Trustees of savings banks have no authority to provide for the investment and management of money received on deposit in any other way than by themselves or the proper officers immediately employed by them and directly account- able to them. After trustees of a savings bank have invested the moneys received on deposit, they are accountable to depositors for the actual proceeds of such investment as trustees, but not person- ally if acting prudently and in good faith. Section 33 says that the depositors shall receive " as nearly as may be all the profits of such corporation after deducting necessary expenses and reserving such amount as the trustees may deem expedient as a surplus fund for the security of depositors." The trustees have no right to sell or bargain away those proceeds for a stipulated sum. The law does not contemplate that the trus- tees shall by any -bargain or arrangement subject to hazard these trust funds. On the contrary, it has pointed out the course which must be pursued by them strictly, and whether a contract of this nature might be more advantageous to the depositors than for the trustees to obey the strict letter of the law is not to be considered. Trustees are not permitted in any manner to speculate with these trust funds. If the facts in this case should reveal that the stockholders of the National bank are the same persons who are the trustees of the savings institution, then clearly such an arrangement as is set forth in this contract, whereby the trustees should seek, under the guise of a contract between the savings bank and the National bank, to make money for themselves out of the deposits of the savings bank, would render the contract clearly illegal. Section 21 provides that the trustees of a savings bank shall not have any interest whatever, direct or indirect, in the gains or profits Savings Bak^ks. 361 thereof, nor directly or indirectly receive any pay or emoluments for their services except as provided for in the act. Any arrangement, therefore, by which they should seek directly or indirectly to make money for themselves out of the deposits, and thereby deprive the depositors of the surplus which might accrue if they carried out strictly the pi'ovisions of the act, would be illegal. I do not think tlie mere contract by a savings bank with a dis- count bank to have the clerical work of the savings bank done by such discount bank would be illegal or a violation of the provisions of the Savings Bank Act, but if an arrangement is made by which a delegation of power to exercise judgment or discretion is con- ferred, it would be illegal. LESLIE W. EUSSELL, Aitornei/-Genercd. UNLAWrUL FOE, SAVINGS BANKS TO PURCHASE BONDS ISSUED BY THE STATE OF MINNESOTA. STATE OF NEW YOKK : Office of the Attoknet-Gbnbraj,, ) Ajlbany, June so, 1883. ) Hon. A. B. Hepburn, Superintendent of the Banking Department : Mt Dear Sir — I beg to acknowledge your communication ask- ing my opinion upon the question " Are Minnesota State bonds a legal investment for savings banks of this State ?" I reply: By the third subdivision of section 26, chapter 287 of the Laws of 1880, it is provided: That it shall be lawful for the trustees of a savings bank to invest the moneys deposited only (aside from certain investments not material to be considered here) in the stocks or bonds of any State in the Union that has not within ten years previous to the making of such investment, defaulted in the payment of any part of either principal or interest of any debt authorized by any legislature of said State to be contracted. The object of this statute undoubtedly was to prevent the'invest- ment by savings banks in the stocks of a State which had author- ized repudiation of any debt sanctioned by the law-making power of the State as contra-distinguished from those bonds issued by some executive officer without any authority or warrant of law. 46 362 Opinions by the Atioenet-Genekal. On the 36th day of February, 1857, the Congress of the United States passed an act authorizing Minnesota to frame a Constitution and State government. On the 39th of August, 1857, delegates in convention framed a Constitution for the proposed State of Minne- sota. On the 13th of October, 1857, the people ratified this Con- stitution by a i:)opular election. On the 11th of May, 1858, Congress admitted Minnesota into the Union. Between the times of the ratification of the Constitution and ad- mission into the Union of the State, and on the 9th of March, 1858, the first legislature of the State voted to submit an amendment to the Constitution to the vote of tlie people. On the 15 th of April, 1858, the people adopted this amendment. The amendment in question authorized the issuing of what are known as the old rail- road bonds of Minnesota. The act of submission of the amendment was apjDroved by the as- sistant secretary of State as acting governor. In the year 1858, after the admission of Minnesota to the Union, Governor Sibley, of Minne- sota, refused to issue the railroad bonds, and the supreme court of that State directed him by mandamus to do so, and they were issued then by the executive to the amount of $3,375,000. This debt has never been paid and the State has recently compromised the same. I assume that a portion of these bonds were payable within the last ten years. I have not the slightest doubt but that the State of Minne- sota will jealously guard her honor in the payment of future obliga- tions, and think the proposed four and one-half per cents of that State are practically excellent securities, but I am stiU, nevertheless, satisfied that under the spirit and tenor of the act of 1880 the State of Minnesota comes within the category of those States which have defaulted in the payment of debts authorized by the legislature. The term " legislature " must be given a significance in accord- ance with the spirit and intent of the act, if it be possible. It may be considei'ed that the amendment of the Constitution adopted by the people authorizing the issue of bonds, which amendment was adopted by the authority of the legislature itself, is a debt which is authorized by the legislature, considering the legislature to be simply a body authorized to pass laws during the inaction of the people upon that subject; but in the higher and broader sense the term " legislature " may mean the law-making power of the State, includ- ing the action of the people themselves when they see fit to change the fundamental law, contrasting the law-making power with the execu- tive and judicial branches of the government. I am, therefore, of Savings Banks. 36S the opinion that the investment by savings banks of this State in Minnesota State bonds is contrary to the spirit and scope of the act of 1880, and cannot be allowed. Kespectfnlly yours, LESLIE W. EUSSELL, Attorney- General. UNLAWPTJL FOR SAVINGS BANKS TO INVEST IN BONDS OF PRIVATE CORPORATIONS SECURED BY MORT- GAGE ON REAL ESTATE. STATE OF NEW YORK: Office of the Attorney-General, ) Albany, July 38, 1882. f Hon. A. B. Hepbuen, Superintendent of the BanTcing Department : Dear Sir — I have the honor to acknowledge the receipt of your communication of June 22, submitting for my inspection a copy of a mortgage made by the American Deposit Company of tlie city of New York, a domestic corporation, to the Metropolitan Trust Com- pany, upon certain real estate situated in the city of New York, for the purpose of securing the bonds of said deposit company, issued under authority of a resolution of the directors thereof, to the amount of $100,000, in which said mortgage it is provided that the said Metropolitan Trust Company, in case of a failure of the said deposit company to make the payments when due of any money, principal or interest secured by said mortgage, may, when requested so to do, in writing, by the holder of at least ten per centum of the bonds secured by said mortgage, proceed to the foreclosure thereof, and requesting my opinion upon the following questions : 1. As to whether it would be investing in " unincumbered real estate," within the meaning of the statute, for a savings bank to purchase ten or more of these bonds, or a number sufficient to enable them to enforce payment in case of default. 2. Does the word "unincumbered" mean without prior incum- brance, or does it mean without incumbrance except such as the savings bank owns in entirety ? 3. Is there any legal objection to savings banks investing in one or more of a series of bonds secured by a mortgage upon real estate, their being no prior lien and the sum held being sufficient to entitle 364 OPINlOiilS BY THE ATTOENET-GrEIfEEAL. the bank to institute foreclosure proceedings in ease of default, the property mortgaged being situated wholly within this State, and worth at least double the amount loaned thereon, as certified by a committee charged with investigating the same, and the statute in other respects being complied with ? In reply to such communication I have to state : That, in my opinion, the mortgage submitted for my inspection does not fall within the class of bonds and mortgages intended by the statute authorizing banks to invest in bonds and mortgages on unincumbered real estate, for the following reasons: First. Because the mortgage executed for the purpose of secur- ing the payment of said bonds does not require the trust company to institute foreclosure proceedings when requested to do so by the holder of ten per centum of the bonds, but only provides that it shall not institute such proceedings unless requested so to do by a holder of that amount of the bonds, and a refusal to take such pro- ceedings when so requested could only be remedied by a suit in equity to compel the trust company to act. Second. By "unincumbered real estate," in my opinion, is meant real estate without incumbrance, except such as the savings bank owns in entirety. The statute intends that the savings bank shall have the exclusive control of its investments, both as to the amount and the time for which they are made. Although as in the present instance they may have the power when owning a certain number of these bonds to cause to be instituted foreclosure proceedings to secure the payment of such bonds, still any other holder of the same number of bonds would have the same right, and thus the bank could have no certainty as to the time or permanency of their investments, and no certainty as to the amount it might be forced to invest in such property at almost any time in order to save itself from loss because of foreclosure proceedings instituted by parties over whom it had no control. Third. I am further of the opinion that the statute authorizing the incorporation of savings banks does not intend that they shall act and be contracted with through the medium of a trustee out- side of the directors of the corporation. The trustee, if an indi- vidual, may die, or if a corporation, may be dissolved, or have its franchises annulled before the completion of the duties of the trust, and thus throw the affairs of the savings institution into a confu- sion that only a recourse to the courts could unravel. These cor- porations are provided with directors and ofHcers whose duty it is Savings Banks. 365 to manage their affairs; and in my opinion the statute intends that all contracts with the corporation shall be made directly with its governing body, without the aid of an intermediary trustee. For the foregoing reasons, I am of the opinion that savings banks have not the power to invest in one or more of a series of bonds not amounting to the whole number of such bonds, secured by a mort- gage on real estate, there being no prior lien, and the sum held being sufficient to entitle the bank to institute foreclosure proceed- ings in case of default, even though all the obher conditions of the statute be complied with. Very respectfully your obedient servant, LESLIE W. EUSSELL, Attorney- General. UNLAWFUL FOR SAVINGS BANKS TO KECEIVE SPECJIAL DEPOSITS OP VALUABLES FOR HIRE. STATE OP NEW YORK : Office of the Attorney-General, ) Albany, October 7, 1883. ) Hon. A. B. Hepburn, Superintendent of the Banhing De])artinent : Sir — I have the honor to acknowledge the receipt of your favor of the date of the ith inst., enclosing a communication from Geo. Smith, Esq., treasurer of the Jefferson County Savings Bank, addressed to you, and which you desire me to answer through your department : The communication is as follows : "Superintendent Banhing Department: "Dear Sir — One of our trustees thinks we woulc' be liable for loss if we sliould charge a person for storage of valuables in our safe, notwithstanding he signed an agreement that we should not be liable, and that we only under- take to furnish such security as we have ourselves. He wished the opinion of the attorney-general through the bank department. " Respectfully yours, "GEO. SMITH, " Treasurer." Mr. Smith's query is not couched in as definite terms as might be wished, and it is impossible to pass upon the effect of a contract made with a depositor with any degree of accuracy without a more 366 Opiitions by the Attorney-Geneeal. fall and explicit statement of the terms of such contract than is here given. I presume, however, that every useful purpose will be subserved, if an opinion is expressed upon the proposition whether it is within the corporate powers of a savings bank to receive special deposits of valuables for hire under the terms of statutes permitting the organization and governing the management of such institutions. Upon that question I respectfully submit that savings banks have no power to receive special deposits of valuables. They are corpo- rations formed for a special and limited purpose, and cannot engage in the common and ordinary business which a banking institution may conduct. They may not dii-ectly or indirectly deal or trade in i-eal estate, or in any goods, wares or merchandise, buy or sell or exchange gold or silver, collect or protest promissory notes or time bills, or issue certificates of deposit (sec. 266, chap. 409, Laws 1883). Their busi- ness is to receive money on deposit, and to invest the same in par- ticular ways, which are carefully specified in the statutes. It is a well-known rule that corporations created by statute can exercise no powers, and have no rights except such as are expressly given or necessarily implied. {Huntington v. Savings Bank, 6 Otto, 388; First National Banh of Manhattan v. Citizens' Bank of Topeka, 21 Int. Eev. Eec. 382.) The power to receive such special deposits has not been given to such institutions by statute, and cannot be said to be one of those incidental powers which it is necessary or customary for them to exercise; in this respect they differ from corporations authorized to transact a general banking business. (80 N. Y. 98. ) I am of the opinion, therefore, that the receiving of special de- posits of valuables, for hire, by savings banks, is ultra vires and unauthorized. I am, sir. Very respectfully yours, LESLIE W. RUSSELL, Attorney- General. Sa-vings Banks. 367 unijAwful for a savings bank to borrow money on a pledge of its securities. STATE OP NEW YORK : Office of the Attornet-General, ) Albany, October 8, 1883. ) Hon. Willis S. Paine, Superintendent of the Banking Department : Dear SiK — Replying to your favor of the 1st inst., requesting my opinion as to whether there is any provision of law justifying the trustees of a savings institution in borrowing money or pledg- ing its securities, I beg to state tliat the statutes, so far as I have been able to examine them, contain no express authorization or pro- hibition of such a course of procedure on the part of the trustees of a savings institution. I think, however, that it would be contrary to the spirit of the act, chapter 409 of the Laws of 1883, as that act describes very specifically as to how the money shall be invested, and provides for keeping an available fund to meet current expenses, and generally is very explicit in all its details as to the management and conduct of an institution of that description. If a savings bank can joledge a part of its securities, it could pledge them all, and thus virtually defeat the effect of the statute, providing for the safe-keeping and investment of the funds of its depositors. I am of the opinion that such course would be contrary to the policy of the statute, and should not be adopted. Very truly yours, LESLIE W. EUSSELL, Attorney- General. THE BY-LAW OF A SAVINGS BANK FIXING THE TIME OF HOLDING A REGULAR OR ANNUAL MEETING OF THE TRUSTEES IS IN ITSELF SUFFICIENT NOTICE TO ALL PARTIES. STATE OF NEW YORK : Office of the Attorney- Genbraij, ) Albany, April 12, 1884. ) Hon. Willis S. Paine, Superintendent of the Bank Department : Deae Sir — I am in receipt of your favor of 10th inst., en- closing statement as to Eoslyn Savings Bank. 368 Opinions by the ATioKNEr-GENEKAL. I am of opinion that a by-law stating the time of liolding of the regular or annual meeting of the trustees or directors was in itself sufficient notice to all parties, and therefore all proceedings had at the meeting on April 7 (assuming that the meeting did not transact only legitimate business and was a fair open meeting), were and are valid. Very truly yours, D. O'BEIEN, A ttorney- General. THE TEN DAY PERIOD AS TO PAYMENT OP INTEREST BY SAVINGS BANKS NOT APPLICABLE TO BANKS PAYING INTEREST QUARTERLY. STATE OP NEW YORK : Office of the Attokney-Gbnbrai, ) Albany, Juiie 24, 1884. ) Hon. "Willis S. Paine, Superintendent of Banks : Deae Sir — Your communication of the 33d inst. has been duly received. My construction of chapter 48 of the Laws of 1884, concerning which you ask my opinion, is, that all savings banks which allow interest semi-annually on deposits may pay interest for the whole "interest period," .provided the deposit upon which the interest is allowed is made any time within ten days from the commencement, or withdrawn on either of the last three days of the ending thereof. I find nothing in the act which makes the same exception in favor of banks which pay interest quarterly. If the ten days' provision could be extended by implication to banks paying interest quarterly, it could, with equal propriety, be extended to banks paying interest monthly, which would in efEect abrogate by implication the express provision of the statute which declares "that it shall be unlawful for the trustees of any savings bank to declare or allow interest on any deposit for a longer period than the same has been deposited." Very respectfully. Your obedient servant, D. O'BEIEN, A ttorney- General. Savings Banks. 369 PENALTY FOR SAVINGS BANKS NEGLECTING- TO TRANS- MIT SEMI-ANNTJAL REPORT WITHIN THE TIME PRE- SCRIBED BY LAW, HOW ENFORCED. STATE OF NEW YORK : Office of the Attoenby-Genebal, ) Albany, September 5, 1884. j Hon. Willis S. Paine, Superintendent of the Banking Department : Dear Sib — I find upon examining the report and schedules of the East Side Savings Bank for Sailors, located and doing business in the city of New York, that the semi-annual report required by section 370 of the Banking Code, page 686, Laws of 1883, to be made on or before the 1st day of February and August in each year, was not received until the 13th of August, 1884. By section 374 the penalty for failure to furnish the report within the time required is prescribed, namely, $100 per day for each day's delay, unless the time has been extended by the superintendent, which in this case I assume has not been done, the same to be sued for by the superintendent, in his name of office, and unless there be some satisfactory excuse for such failure there can be no doubt of the successful maintenance of such an action. It appears that the trustees of said institution have changed the location of the bank without your consent in violation of sub- division 3, section 363 of the Banking Code; have held but three trustee meetings in violation of section 253 of said code, the remedy for which seems to me to be provided for by section 378, which provides, among other things, that whenever it appears to you that any savings institution has committed any violation of its charter or law you shall by an order under your hand and seal direct a dis- continuance of such illegal practice, etc. And it is further pro- vided that whenever it shall appear to you that it is unsafe or inexpedient for such corporation to continue to transact business you shall communicate the facts to the attorney-general who shall thereupon institute jsroeeedings, and the remainder of the section gives the court discretion to grant such relief and render such Judgment as the facts and the interests involved shall seem to require. While pointing out, however, the various powers with which the snpei'intendent of banks is clothed I do not wish to be considered 47 370 OPINIOlfS BY THE ATTORNBT-GtENEEAL. as advising any particular course of procedure or as expressing an opinion as to the necessity of any action whatever being taken; these are questions which rest in your discretion and which are to be determined by you upon all the facbs and the evidence in the case. There may be reasons which would excuse all the violations of law referred to, and of their force you are the judge. Very respectfully, Your obedient servant, D. O'BKIEN, A ttorney- General. CONSTRUCTION OF THE TEEM " TBTTST FUNDS." STATE OF NEW YORK : Officb op the Attoeney-Gbnbbal, ) Albany, September 30, 1884. ) Hon. Willis S. Pain^e, Superintendent of the Banking Department : Dbae Sir — I am in receipt of your communication of the 35th inst., enclosing the following section of chapter 409 of the Laws of 1882, viz. : " It shall be unlawful for any savings bank, directly or indirectly, to receive from any individual a deposit or deposits in excess of three thousand dollars, but this limitation shall not apply to deposits aris- ing from judicial sales or trust funds," and requesting my opinion on the meaning to be given to the words "trust funds," as used therein, and whether or not a simple deposit of a sum of money by " A ■" in trust for " B "' constitutes it a trust fund, or if it is a requi- site that such fund be directed to be deposited by a public ofiBcer, or by order of court, or by an officer of court, or other oflBcial legally and duly appointed trustee or custodian of the same. In my opinion the words " judicial sales or trust funds " include not only judicial sales, but judicial trust funds, and the only cases in which it is proper for savings banks to receive deposits from indi- viduals, to an amount exceeding three thousand dollars are cases where the deposits are directed to be made by a competent court or other judicial officer, for a particular use or purpose, and a trust thereby created in pursuance thereof. I do not think ordinary trustees are included in the statute. Savings Banks. 371 Therefore, a deposit by " A " in trust for " B " of a sum in excess of three thousand dollars should not be received by a savings bank, unless under an order of court. Very respectfully. Your obedient servant, D. O'BEIEN, A ttorney- General. WHAT CONSTITUTES A MAJOEITT OP A BOARD OP TRUSTEES OP A SAVINGS BANK WHEN FIXING COM- PENSATION OP OPPICERS. STATE OF NEW YORK : Office of the Attornby-Genbbal, | Albany, October 3, 1884. ) Hon. Willis S. Paine, Superintendent of the Bunking Department : DbaeSir — ^ Your favor of the 26th inst. has been duly received, in which you ask my opinion upon the following question, viz. . " Where a vacancy exists in the board of trustees, do the words ' majority of the board ' require that such compensation shall be fixed by what would be a majority, if no vacancy existed, or may it be done by a majority of the actual members? Can such opinion be signified in writing by a majority, outside of a meeting of the Board ? " Section 369 of chapter 409 of the Laws of 1883, provides that " it shall be lawful for trustees of such corporation, acting as oflBcers of the same, whose duties require and receive their regular and faithful attendance at the institution, to receive such compensation as, in the opinion of the majority of the board of trustees shall be just and reasonable, but such majority shall be exclusive of any trustee to whom such compensation shall be voted." I think a majority of the board of trustees means a majority, ex- clusive of any trustees to whom such compensation shall be voted, of the full board, aud not a majority of the actual members, where there are vacancies. I do not think the trustees can fix such salary by signing a paper "outside of a meeting." There should be a meeting, and a resolu- tion duly offered and passed. Very respectfully. Your obedient servant, D. O'BEIEJSr, A ttorney- General. 372 Opiitions by the Attoenbt-Gtenbral. THE SURPLUS OP SAVrNGS BANKS MAT BE IlfVBSTED IN THE SAME MANNER AS DEPOSITS. STATE OF NEW YORK : Officb of the Attornbt-Gbnekal, ) Albany, October 3, 1884. \ Hon. Willis S. Paine, Superintendent of the Banking Department : Deae SiE — Your letter of the 35th inst., asking whether or not, in my opinion, savings banks can invest sixty per cent of their accumulated surplus in bond and mortgage upon real estate, and whether such investments would be contrary to law, has been duly received. I find no provision of law which forbids such investment of the accumulated surplus. T do not think the fact that the law directs the manner in which deposits are to be invested can be so construed as to prohibit the accumulated surplus from being invested in the same manner, if the trustees think it proper to do so. Very respectfully. Your obedient servant, D. O'BKIEN, Attorney- General. METHOD OP ESTIMATING THE SURPLUS OP SAVINGS BANKS. STATE OF NEW YORK : Office of the Attornbt-Geneeal, ) Albany, December 5, 1884. ) Hon. Willis S. Paine, Superintendent of the Banking Department : Deae Sie — I am in receipt of your communication of the 26th ult., containing the following question upon which my opinion is requested, viz.: " Section 263 of the Revision of the Banking Laws of this State authorizes savings banks to hold and convey real estate for certain purposes. Among those enumerated is ' a plot whereon is erected, or may be erected, a building or buildings requisite for the con- venient transaction of the business of the bank.' Except written Savings Banks. 373 permission be obtained of the superintendent of the banking de- partment, authorizing the expenditure of a greater sum, the aggre- gate cost of such banking buildings is restricted to fifty per centum of the net surplus of the bank." "The question arises as to what the correct method is of deter- mining the surplus of a savings bank, the trustees of which have in contemplation the erection of a banking building, should the values fixed by section 368 of the said Eevision be given to the sev- eral classes of securities held, or may the assets of the bank be esti- mated at present market values ? " In reply thereto, I beg leave to state, section 368, above referred to, provides that " in determining the per cent of the surplus held by any savings bank, its interest-paying stocks and bonds shall not be estimated above their par value, or above their market value if they are below par; its bonds and mortgages on which there are no arrears of interest for a longer period than six months shall be esti- mated at their face, and its real estate not above cost. Concerning such stocks or bonds, or bonds and mortgages as are in arrears of interest for six months or more, and concerning all other invest- ments not herein enumerated, the superintendent of the banking department shall determine the valuation of the same from the best information he can obtain, and he may change the valuation thereof from time to time, according as he may obtain other and further information." This section prescribes a safe, and what seems to me, correct method of ascertaining the value of property in which savings banks have invested their funds. First. In no case can any stock be valued above par, and if their market value be below par they cannot be valued above their actual market value; that is, the prices they would bring in the open mar- ket, or if listed, in the exchanges in which such stocks are gener- ally bought and sold. Second. 'Its bonds and mortgages on which there are no arrears of interest, for a longer period than six months, must be valued at their face value, and its real estate at not above cost. So far the statute is peremptory, perspicuous and sensible, and does not admit of the exercise of discretion in the ascertainment of values. Although the real estate might and often does rise in value, it as often falls, according to the demand, change jn the character of the neighborhood in which it is situated, and as its value is, in a very large degree, a matter of judgment or opinion, it is necessary 374 OPIiriOlfS BY THE A.ttokket-Gbn"eral. to have a fixed and stated rule in its appraisement, and there could be no better rule than that which makes its actual cost the standard. Third. Concerning such stocks or bonds, or bonds and mortgages as are in arrears of interest for six months or more, and concerning all other investments not enumerated, the superintendent is made the judge of their values, and is legally bound to make investiga- tion and use his utmost endeavor to ascertain their fair and actual value; that is, the price they could be sold for at auction. It will be observed, however, that in this third class, of securities, the valuation of which is left to the discretion of the superintend- ent, are enumerated "bonds and mortgages that are in arrears of interest for six months or more." This appears to be in conflict with the rule relating to securities mentioned in the second class, viz. : Bonds and mortgages on which there are no arrears of inter- est for a longer period than six months, and for the valuation of which a mandatory rule is prescribed. In the one case, if the interest is due for six months or more, the superintendent exercises discretion, and, in the other case, if the inter- est is due for just six months and no more, he shall not exercise dis- cretion. The period within which discretion is prohibited, and that in which it is allowed, both include the last day of the six months. In the construction of statutes, where a conflict of this character arises, I think the general policy of the law would be rather to limit than extend the power of the superintendent. And, in addition to this, I think the intention of the legislature was that the interest on bonds and mortgages should be due for more than six months before the superintendent could exercise any discretion or opinion in fixing their values. I am, therefore, of the opinion that section 268 should be followed in accordance with the above interpretation, in the ascertainment of the value of property belonging to savings banks in all cases. Very respectfully, Your obedient servant, D. O'BRIEN, A ttorney- General. Savings Bakes. 375 CONSTITTJTIOIfALITY" OF THE ACT ENTITLED "AN ACT TO PROVIDE REVENUE FOR THE STATE BY A TAX ON SAVINGS BANKS AND INSTITUTIONS FOR SAV- INGS." STATE OF NEW YORK : Office op the Attoknby-Gbnbkal, ) Albany, February 19, 1885. ) Hon. Willis S. Paine, Superintendent of the Banhing Departmeiit : Dear Sir — The question -whether or not that part of the act entitled "An act to provide revenue for the State by a tax on savings banks and institutions for savings," which provides that surplus invested in United States securities shall be liable to taxa- tion, is constitutional, has been duly considered by me and the fol- lowing is my opinion upon the subject. Section 3700 of the Revised Statutes of the United States pro- vides that " All stocks, bonds, treasury notes and other obligations of the United States shall be exempt from taxation, by or under State or municipal or local authority." The power of Congress to pass and enforce this statute is derived from the Constitution of the United States. Subdivision 3, section 8 of which provides that Congress shall have power " To borrow money on the credit of the United States," and subdivision 17 of said section that " Congress shall have power to make all laws which shall be necessary and proper for carrying into execution the foregoing powers, and all other powers vested by the Constitution in the government of the United States or in any department or ofBcers thereof." The statute referred to must have been deemed, in the judgment of Congress, a " necessary and proper " law " for carrying into ex- ecution the foregoing " power '''■ to borrow money on the credit of the United States." "While there is no doubt, therefore, that Congress had full power to pass this statute, and that it prohibits the taxation of United States securities, owned by private individuals or corporations, when such is levied as a property tax, the bill under consideration does not seek to tax the property of savings banks, as such. It simply imposes a duty upon them, or in other words charges them for the privileges of carrying on business in this State as corpora- tions, and the amount to be charged is regulated by the amount of 376 Opikions by the Attobnet-Genbeal. surplus, "whether invested in United States securities or other- wise." The bill does not seek to tax the surplus itself. It only takes the amount of surplus into consideration in order to deter- mine what is fair and just compensation to the State, for the privi- lege it enjoys as a corporation at the hands of the State. The words "whether such surplus is invested in United States securities or otherwise,'' are really superfluous. Surplus is surplus, whether invested in United States securities or real estate, and the amount to be paid to the State for the corporate franchise is regu- lated by the amount of such surplus, and it is immaterial in what it is invested. I am, therefore, of the opinion that the bill in this respect is not unconstitutional. Very respectfully. Your obedient servant, D. O'BEIBN, A ttorney- General. SAVTNGS BANKS MAY LAWFULLY PUECHASE BOIIDS ISSUED BY THE STATE OF INDIANA. STATE OF NEW YORK : Office of the Attornbt-Gbnhral, ) Albany, May 1, 1885. ) Hon. Willis S. Paine, Superintendent of the Banking Department : Deae Sir — I am in receipt of your favor of the 38th ult. request- ing my opinion as to the legality of the investment by savings banks of this State in the bonds of the State of Indiana recently issued. Accompanying your communication I find a statement of the facts relating to the financial history of the State of Indiana since 1839, out of which facts the question in regard to which I am re- quested to express an opinion has arisen. The general statute of this State, passed in 1875, prescribes the obligations and securities in which savings banks may lawfully in- vest the moneys confided to their charge, and it is not lawful for them to invest in any other obligations or securities than as spe- cifically prescribed in this statute. The third subdivision of the 26th section of that act per- mits the trustees of savings banks to invest " in the stocks or bonds SAVI2S-GS Banks. -377 of any State in the Union that has not within ten years previous to mahing such investment by such corporation^ defaulted in the pay- ment of any part of either principal or interest of any debt author- ized by any legislature of such State to be contracted/' There can be no doubt, I apprehend, that the bonds recently issued by the State of Indiana, and now offered for sale, are entirely safe inTCstments. That these bonds and the interest thereon will be promptly paid, as the interest and the principal matures, and that the faith and honor of the State will be kept, is as certain as that the State of New York will promptly meet and pay all of its obligations ; but, as I have already stated, it is not lawful for sav- ings banks to invest in the bonds of any State in the Union that, within ten years previous to the making of such investment, de- faulted in the payment of any part of either principal or interest of any debt authorized by the legislature of the State to be con- tracted, and if the State of " Indiana has, in fact, made such default within ten years, savings banks cannot lawfully invest in its bonds, though it may be morally certain that the faith and promise of the State will be scrupulously observed. There could be no doubt or question whatever in regard to the legality and propriety of such investments, except for the peculiar nature of various transactions connected with the financial history of the State of Indiana, which is disclosed in the papers submitted to me, and which is also set forth in detail in the fifth annual re- port of the bureau of statistics of the State of Indiana, page 127, and also in the last census of the United States, page 618. A brief statement of the facts relating to these transactions is necessary in order to furnish an intelligent answer to the question which you have propounded to me. In 1845 the total indebtedness of the State of Indiana was $16,- 462,760. Of this total indebtedness the sum of $10,954,000 was secured by the bonds of the State, duly issued under authority of the legislature and drawing five per cent interest. In 1846, and perhaps for two or three years previous, the amount of money raised by the State from taxes seems to have been inadequate to pay the interest on these bonds in full, and as to some portion at least of the accrued interest, the State was doubtless, at that time, in default. The legislature in that year passed an act providing that the holders of these bonds might sui-render them to the State and receive in their stead new certificates of stock, redeemable at the 48 378. Opisrioisrs by the Attoenet-Geneeal. pleasure of the State after twenty years. The certificate was to specify the principal of the bond surrendered, and distinct there- from the amount of accrued and unpaid interest on the same from January 1, 1841, to January 1, 1847, inclusive, such interest to be computed at the rate of two and one-half per cent per annum, and on which the State agreed to pay interest as follows : On the prin- cipal specified in such certificate, at the rate of two per cent per annum from January 1, 1847, to and inclusive of the 1st day of January, 1853, at which period the amount of interest specified in such certificate and the one-half cent per annum on said principal from the 1st day of January, 1847, to the 1st of January, 1853, should be added to the principal, and from that time forth the State would pay interest on the principal and interest so added at and after the rate of two and one-half per cent per annum, until the same shonld be finally redeemed; that if the revenues of the State to January, 1853, applicable to such payment, were not suffi- cient to pay such two per cent interest, the State should only be required to pay up to 1853 such rate of interest as the funds in the treasury would allow. Thus far the payment of one-half only of the interest, viz. : two and one-half per cent was provided for. But the act further provided that the bondholders might, in order to secure themselves, in the payment of the remaining two and one-half per cent interest, raise among themselves, by a pro rata subscription on the amount of bonds held by them respectively, at any time before the 1st of January, 1847, a sufiicient sum, not less than $3,250,000 to complete the Wabash and Erie canal to Evansville, such subscription to be paid to trustees and to be ad- vanced in such sums as should insure the completion of said canal to that place. The canal lands and tolls and revenues were specifi- cally set apart and conveyed to the trustees, in trust and as security, to reimburse to said subscribers their said advances, and to pay the remaining interest on the said bonds. The proceeds of the lands (sold and unsold) were to be applied to the repayment of the principal sum advanced for the completion of the canal. The balance of the proceeds of said lands and the tolls and revenues of the canal, up to and including the 1st of January, 1853, after paying expenses for repairs, etc., were to be applied: 1. To pay in full the interest at six per per cent on the sums ad- vanced to complete the canal, and the remainder to be applied to pay the balance of the principal of the sums so advanced. Savings Banks. 379 2. To pay in full the subscribers making the advances and inter- est at the rate of two and one-half per cent per annum on the principal of the bonds they had surrendered as aforesaid. This was the provision made for the payment of the remaining two and one-half per cent on the original bonds surrendered as above authorized. There was also another provision in the act to pay in full to any other holder of any certificate of stock authorized by the act, in- terest at and after the rate of two and one-half per cent per annum. Any balance remaining after the payments above required to be made was to be paid into the State treasury, for the purpose of the redemption and retirement of any of the outstanding stocks created by said act, principal and interest. The 32d section of the act further provided that it should be optional with the State at any time to call in and require a surrender of the stock issued in the 1st section of the act (i. e., the stock first above mentioned), by giving to the holders of such stock a new certificate for one-half of the principal thereof, to bear interest at and after the rate of five per cent per annum, payable by the State out of the revenues thereof. And for the other half of the interest and principal the holders were to look solely and ex- clusively to the canal lands, tolls and revenues. The State reserved the privilege, however, of paying the entire amount of such certifi- cates from its own funds if it so desired. The purpose of this legislation manifestly was to bring about an adjustment or compromise of the outstanding debt of the State. It authorized the holders of bonds to surrender them and take in lieu thereof the certificate above mentioned. The surrender of the bonds by the holders thereof was to be entirely voluntary on their part; but if they elected under this statute to surrender the bonds and take the certificates therein provided for, then the State reserved the right in its turn to call in these certificates and issue instead thereof certificates for one-half the debt with five per cent interest, and for the other half certificates payable wholly and exclusively out of the canal, its lands, tolls and revenues. It seems that, under this arrangement, all the outstanding bonds of the State, except a very small amount, were surrendered, and the above-described certificates taken by the creditors in their place. In 1847 the legislature of Indiana passed another statute, the 1st section of which declared that, by virtue of the option reserved to the State by the 33d section of the act of 1846, the out- 380 Opinions by the Attoeney-Geneeal. standing certificates of the State, issued under the last-mentioned act, should be surrendered by the holders thereof and a new issue made in exchange for the two classes of certificates, each of such certificates to be for a moiety of the principal money secured by the certificate for which the same should be exchanged, and to bear in- terest at the rate of five per cent per annum, the interest to be computed from January 1, 1847; that one of such certificates, with the interest, should be paid by the State out of its revenues, re- deemable by the State after twenty years. The other of such certi- ficates, with interest, should be paid out of the canal lands and tolls and revenues of the canal, as provided by the act of 1846, re- deemable at the pleasure of the State after twenty years, if it so desired. Under this legislation, the holders of the original bonds became possessed, in lieu thereof, of two bonds or certificates, one intended to be the obligation of the State itself, and payment of the other certificate was shifted from the State to the canal, its property, tolls and revenues. This situation, however, was brought about by the voluntary act of the creditors of the State themselves. No doubt the failure of the State to pay the interest prior to 1846 had some influence upon the action of the bondholders; but in a legal sense their action must be considered as voluntary. The certificates taken in lieu of the bonds, and for which the revenues and property of the canal were pledged (or at least a large amount of them), have not been paid. The canal lands, and the canal itself, have, as I understand, been sold under foreclosure, leaving a large deficiency in the sum necessary to pay these out- standing certificates. The following is a copy of one of these certificates: by the law of the place of its domicile to receive deposits, in order that it may do the same here, provided that it complies with the precedent conditions, and deposits the required amount of securities with the banking department, which I am informed the Jarvis Conklin Mortgage Trust Company has done. The power of trust companies to borrow money, which is the next question in order, was discussed at length in the case of Cur- tis V. Leavitt, 15 N. Y., 57 to 63, and it was there held that the power to borrow money was an incidental and auxiliary power belonging to corporations, and that the exercise of such a power was not contrary to any law or the general policy of the State. In view of this case I do not deem it necessary to discuss this question any further; but will simply state that in the case of Gurtis v. Leavitt {supra) it is stated that a general deposit in a bank is in exact legal result a loan. From this statement it might be inferred that the admission or determination of the right to borrow carried with it necessarily the right to receive deposits. There is, however, a recognized and Trust, Loan and Mortgage Companies. 473 well defined distinction between a deposit and borrowing. {Paine V. Gardiner, 29 IST. Y., 146.) The next and only remaining question, viz., the legal right of the company to issue its bonds or debentures, depends upon the extent and interpretation of the restraining laws and also upon the form of the instrument. Chapter 5 of the act of 1882, sections 70 to 124 inclusive, author- izes banking corporations, i. e., corporations formed pursuant to the provisions of chapter 4 of said act to issue its notes to circulate as money. "Without citing the provisions of these sections in detail, it will be sufBcient to state that the main features of them are that the superintendent of the banking department issues notes to a certain amount, upon the application of a banking corporation and delivers them to such corporation to be used and circulated as money. But before they can be issued ample provision is made for their redemp- tion, and the superintendent is required to exact from banks requiring such notes before they are issued, a deposij; with him of an equal amount in value of interest-bearing stocks of the State of New York or the United States. There are various other and minute provisions of the act for the purpose of insuring the value of these notes dollar for dollar. This is the only manner now authorized by law by which notes or bills may be put in circulation by private parties or corporations, to be circulated as money. These bills or notes are required by section 117, as amended by chapter 564 of the Laws of 1886, to be made payable to bearer on demand and without interest. I will state here that all these provisions relate to banking cor- porations and individual bankers only, and no other corporations of any kind are authorized to issue such bills. And the restraining acts were enacted for the purpose of prohibiting the issuing of such bills and notes by any other than banking corporations. The issuing of these notes is, therefore, a privilege of franchise which may be exercised by banks or individual bankers only. This brings us again to a consideration of sections 297, 299 and 302, of the act of 1882, which as before stated constitute the restraining acts against unauthorized banking. Inasmuch as these sections have already been quoted at length, it is unnecessary to set them out again. These provisions are copied from chapter 20, title 20, part 1, of the Eevised Statutes, and probably take the place of such portion of the Eevised Statutes. Although there appear 60 474 OpiiirioKS by the Attoeney-Gbneeal. to have been no adjudications upon the point under consideration since the revision, still such revision has not changed the interpre- tations which the courts have previously placed upon such pro- visions. And adjudicated cases upon the extent and interpretation of such provisions may still be referred to as authority. (7 Hill, 79; 24 Wend., 45, 46.) I think, therefore, the question may be determined by a brief re- view of the decisions of the courts. It will be observed that the bills or notes must be issued " for the purpose of loaning them or putting them in circulation as money." Safford v. Wyckoff, 4 Hill, 442, was an action on a bill of ex- change drawn by the defendant as president of the Farmers' Bank of Seneca County. The bill purported to be drawn by the bank payable to Dodge and endorsed by him to plaintiff. Walworth, Chan., held that the bill was valid and might be recovered upon unless issued to be loaned or circulated as money. New York Life Insurance and Trust Company v. Beebe, 7 N. Y., 364. The defendant Beebe, in order to raise money, executed a mortgage to plaintiff. Plaintiff gave him twenty-five per cent in cash and executed to him the remainder in certificates of deposit, payable in twenty years with four and one-half per cent. The court held these certificates void upon the ground that they were evi- dences of debt issued to be loaned, and said: ''The certificate in question was clearly an evidence of debt. By it the company bound themselves to pay interest semi-annually, and at the end of twenty years to pay the principal. If it was issued on a loan it was mani- festly in violation of both the statutes referred to." The cases of Swift v. Beers, 3 Denio, 70, and ChillicotJie v. Dodge, held certain notes issued by banks void, such banks being forbidden by statute to issue time bills. To the same effect is the case of Leavitt v. Palmer, etc., 3 N. Y., 19. There are many other cases of the same import, and all the cases holding notes or bonds issued by moneyed corporations void are where such notes, bills or bonds were issued to be loaned or circu- lated as money. The general rule is well established that a corporation has power to do acts out of the territorial jurisdiction of the State by which it was created, unless expressly restrained by its charter or the laws of the country in which it may attempt to act, and such restriction will not be presumed, but must be shown. {Bank of Augusta Teust, Loan and Mortgage Companies. 475 T. Earl, supra; Tomhigbee R. R. Co. v. Kneeland, 4 How. IT. S., 16 ) The Jarvis Conklin Company appears to have power by its char- ter to issue its bouds. The only law against its issuing them here is that they shall not be issued to be loaned or circulated as money. In the case of Barry v. Merchants' Exchange Co., 1 Sandford's Chancery Reports, at page 312, the point was raised that certain bonds issued by the company with coupons attached were invalid as having been issued contrary to the restraining acts . In disposing of the point the chancellor said: "They were things in action as- signable at law, according to our decisions, by mere delivery but not negotiable. They were not issued for the purpose of loaning them, but on the contrary for the purpose of borrowing money. They were not capable of being put in circulation as money or suit- able for that purpose. * * * The restraining law is a penal act and is to be construed strictly. There is no evidence of an intent to circulate these bonds as money." It is not against the policy of our law that trust companies should issue debentures. This is evidenced by the act of 1887, which is a general act for the incorporation of trust companies. The act gives the right to all citizens to exercise the powers therein mentioned upon compliance with the conditions of the act; and among the powers mentioned in said act appear to be the power " to purchase, invest in and sell stocks and mortgages and bther securities; and when moneys or securities for moneys are borrowed or received on deposit or for investment, the bonds or obligation of the company may be given therefor. * * * " (Subd. 11, sec. 31.) This power is expressly declared, however, not to include the power to issue bills to circulate as money. I think, therefore, that the Jarvis Conklin Mortgage Trust Com- pany may issue its bonds in this State. The question of form of the instrument issued, however, is a very material one, for while there may be no actual intention that they should circulate as money, the general weight of authority seems to be that if they are of such a form as to be capable of being so circulated they come within the evil provided against by the prohibitory statutes. The general form of the body of the "savings bond " proposed to be issued is very similar to an ordinary bank note circulated by banking institutions. It is engrossed. The paper is similar. It has vignettes and other devices which are usual upon bank notes, issued as a circulating medium. It is payable to bearer. It does 476 Opinions by the Attoenbt-Geneeal. not contain the seal of the corporation, and is negotiable and passes by delivery. It is true there are coupons attached and the in- strument is not payable on demand. These coupons may be easily detached and the end called " advice slip " may also be detached, which would leave the "savings bond," so called, but miscalled, for it is not a bond at all, almost identical with a bank note. It is simply a promissory note made in imitation of bank notes. Attorney- General v. Tlie Life and Fire Insurance Company, 9 Paige, 470. In addition to this the instrument is not of the kind or nature authorized to be issued by the charter of the company, at the place of its domicile. The charter authorizes it to issue " deben- ture bonds," and does not authorize it to issue promissory notes ; and under the rule laid down in the case of the Bank of Augusta, 13 Peters, supra, " that a corporation can make no contracts and do no acts either within or without the State which creates it, except such as are authorized by its charter," the issuing of this form of an instrument is without authority. It is for these reasons, I think, objectionable. I am of the opinion, therefore, that the Jarvis Oonklin Mortgage Trust Company may receive deposits and borrow money in this State and issue its bonds as security therefor, but that the form of the proposed instrument is objectionable and within the restraining acts, and that the person issuing them in this State would be liable to the penalty of $1,000 prescribed by the statute. Very respectfully, your obedient servant, CHAS. P. TABOE, A ttorney- General. POBEIGN MORTGAGE COMPAHIES DOING BUSINESS IN THIS STATE ARE SUBJECT TO THE PROVISIONS OP SECTION 219 OP CHAPTER 409 OP THE LAWS OP 1882. STATE OF NEW YORK : OrFiCB OP THB Attoknet-Genbral, ) Albany, July 19, 1888. j Hon. JosiAH Van Veankbn, Deputy Superintendent of the Banking Department : Mt Dbae Sir — I have your letter of the 17th, enclosing a letter from William L. Clark, of New York city, from which latter Trust, Loan and Mortgage Companies. 477 comirunication it appears that Mr. Clark is interested in a corpora- tion about to do business in this State. The company is organized under the laws .of a western State for the purpose of investing money in mortgages on western farms and selling them to investors here, with a guaranty of the payment of principal and interest. Upon such facts he desires to know whether your department will hereafter take the position that such corporation is subject and amenable to sections 219, 224 and 225 of chapter 409 of the Laws of 1882. It is obvious that the information is desired for private and personal purposes. We are not furnished with specific informa- tion as to the precise character of the corporation referred to. No copy of its charter and by-laws or prospectus is sent. Upon the meagre facts presented, I do not consider it my duty nor consistent with official propriety, to express a definite opinion upon the subject, lest in the future I might be called upon for a full statement of facts, knd in^ a case involving an alleged violation of statute to give an opinion upon which the official action of your department might be based. I will, however, say that I am firm in the conviction that com- panies doing business within this State and selling mortgages and guaranteeing the payment of the principal and interest thereon, are subject to the provisions of section 319 of chapter 409 of the Laws of 1882. Further than that I will not express an opinion at this time. Very truly yours, CHAS. P. TABOE, Attorney/- General. INDEX. Note — Laws relating to Savings Banes, separately indexed, see page 499. A-CTIONS SECTION. PAGE by or against 'banking associations, how brought 60 33 for taking usurious rate of interest 68 38 to compel redemption of circulating notes 89, 91 49, 50 not to abate by reason of change of corporate name ... S 228 against non-resident stockholders for taxes 314 165 by receivers against non-resident stockholders 157 86 not to abate by reason of death of president 60 33 not to abate by reason of consolidation 54 31 stockholders' interest not to be set off in 62 34 against joint-stock companies or associations 1 197 against directors illegally continuing in office 2 212 for failure to report list of officers of corporation 6 216 by or against corporations, complaint in 1775 301 unnecessary to prove existence of corporation 1776 302 for non-payment of debts by corporations 1778 302 equality of foreign and domestic corporations in 1779 302 against foreign corporations, when maintained 1780 303 notice of, against foreign corporations to be published, 1 257 against directors for misconduct 1781 303 when brought in behalf of the people 1782 304 for sequestration of property of corporations 1784 304 for dissolution of corporations 1785 305 for annulling charters of corporations 1798 309 for removal of directors of corporations , . . 1811 314 for attachment of corporate property 636 316 preference of civil actions against corporations 791 318 for the unlawful exercise of corporate rights 1948 324 AGENT for redemption of notes to be appointed 86, 97 48, 54 appointment of, to be filed in bank department 87 48 list of names of, to be published 88 48 any number of banks may appoint common 99 55 to witness and certify destruction of notes 79 44 480 Index. , AGENT — Continued. to examine securities in bank department transfer, of foreign corporations, duties of APPEALS when and by wliom, may be taken security on, to be filed with clerk of court .... from order when not to stay execution brought by or against receivers have preference may be taken from order removing receivers : . . cannot be taken from order of reference ARTICLES OF ASSOCIATION" to prescribe manner of conducting business may provide against dissolution to provide for transfer oJ shares of stock may provide for increasing capital stock number of directors to be prescribed in remedy when directors named in, illegally hold over. . may provide for changes in certificate of association . . change in, not to impair rights of creditors when capital reduced below amount prescribed in term of existence fixed by, may be extended organization tax to be paid before filing ASSESSMENTS for expenses of maintaining banking department collection of, how enforced of shareholders to make good deficit in capital ASSETS of closing banks, how and when divided after paying creditors receiver to divide ATTOENET-GENEEAL action by, to annul charter of corporation may bring actions in behalf of the people to be served with notice of application to dissolve . . . . may apply for removal of receiver to approve bonds of banks holding State deposits actions by, for recovery of State taxes providing for publication of notices by BALANCES certain unclaimed, to be paid into treasury BANKING prohibitions against unauthorized provisions of the Revised Statutes relating to BANKING ASSOCIATIONS providing for revision of laws relating to repeal of certain laws relating to subject to specified provisions of banking law authority for organization of SECTION. PAGE. 8 6 1 247 153 85 154 85 149 84 10 853 7 252 151 84 35 33 1 199 47 28 39 35 58 32 1 311 34 33 47 28 1 323 1 319 1 203 6 4 6 5 3 333 109 63 148 83 1797 309 1783 304 8 , 252 7 353 3 223 5,1 203, 304 1 256 10 397 158 4 395 1 175 1 176 57 33 29 20 Index. 481 BANEIlirG ASSOCIATIONS — Continued. section. general powers and liabilities of, defined 35 to be banks of discount, deposit and circulation 63 minimum amount of capital authorized 29 actions against, how brought and prosecuted . ._ 59 shares of stock of, deemed personal property 47 business of, confined to location in certificate 63 placed on an equality with National banks 69 proceedings to change corporate name of 1 may change location by order of court 1 list of names and residences of stockholders to be kept, 46 prohibited from receiving deposits as savings banks . . 283 reduction of capital stock of 41 when duplicate certificates of stock may be issued. ... 2 conversion of State, into National banks 169 conversion of National, into State banks 177 in election of directors subject to Revised Statutes 57 number of directors to constitute quorum 58 shareholders to consent to consolidation of two or more, 48 proceedings to effect consolidation 49 pending suits not affected by consolidation 54 shareholders' liability not changed by consolidation. . . 55 remedy of stockholder dissenting from consolidation. . 56 in full operation until notice of closing is given 113 when notice of intention to close may be revoked 113 judgments against, when and how entered 129 proceedings against, if insolvent 134 when and by whom declared insolvent 130 securities which may be invested in by 87 may hold and convey certain real estate 38 interest at the rate of six per cent may be taken by . . . 68 penalty for taking more than six per cent interest .... 68 to execute a bond as security for State deposits 2 duty of superintendent when capital is impaired 17 no dividends to be made when capital withdrawn 40 after payment of all lawful claims assets may be divided, 109 unclaimed balances belonging to, to be paid into treasury, 10 securities to be deposited for circulating notes 82 to be held exclusively for redemption of notes. ... 84 power of attorney to collect interest on 83 when interest and dividends on, may be retained. . 83 examination of those, deposited in bank department, 8 appointment of agent to examine 8 to be surrendered in proportion to notes returned. 111 held for redemption of notes, how disposed of 101, 103 notes of circulation, the issue of authorized 63 appointment of agents for redemption of 86, 97 any number of banks may appoint a common agent, 99 notice of redemption of, publication required .... 109 61 PAGE. 28 35 30 33 38 35 38 237 325 28 150 36 193 91 94 32 33 38 29 31 31 32 63 63 74 76 74 34 34 87 38 323 10 35 61 7 46 47 46 46 6 6 62 56,57 35 48,54 55 60 483 Index. BANKING ASSOCIATIONS — Continued. sbction. page. notes to be presented for redemption within six years.. 109 61 authorized discount in redeeming notes 90 49 when banks prohibited from buying their own notes, 100 55 those held by banks when to be presented 106, 107 58 securities released on expiration of notice 109 61 deposit of cash may be made for redemption of. . . 109, 113 60, 68 proceedings against banks for failure to redeem. . . 89 49 shareholders of, subject to taxation 312 164 list of stockholders to be kept for purpose of taxation ... 313 1 65 such list subject to inspection of assessors 313 165 dividends to be retained for taxes 315 166 those liable for State tax to report to comptroller 332 ]69 accounts subject to inspection by comptroller 333 170 banks to be notified of assessment of capital stock .... 312 164 BANKING DEPARTMENT established and jurisdiction defined 1 1 charged with the execution of certain laws 1 1 expenses of maintaining, how defrayed 6 4 rooms and furniture to be assigned for use of 5 4 title of the chief ofiicer 2 2 superintendent, how appointed, term of 3 2 seal of office of superintendent 4 8 corporations subject to supervision of 1 1 certified copies of papers filed in, made evidence 31 22 certificates of association of banks to be filed in 81 2)1 certain moneys applicable to expenses of 104 57 BILLS OP EXCHANGE - See Notes. payable on a specified day to be without grace 180 68 drawn at sight payable without grace 1 186 fixing time of payment of certain 4 185 holidays to be observed in acceptance of 1 ] 83 on foreign countries, exceptions as to 117 65 notice to indorser of non-payment 8 186 when protest not reqirired for non-acceptance 3 186 contents of lost, may be proved by parol 1917 333 five thousand dollars and upwards, rate of interest on, 1 187 BLANK FORMS— See Forms. BONDS to be given by superintendent 2 3 CAPITAL minimum amount authorized for banks 39 go of banking associations to be paid in, in cash 18 11 to be paid before commencing business 192 103 examination as to payment of 18 H articles of association may provide for increase of 39 25 when and how, may be reduced 41 26 notice of intention to reduce, to be given , . . . 42 26 Index. 483 CAPITAL — Continued. section. reduction of, when amount required is exceeded 1 amount of, reduced, to be determined by superintendent, 43 wlien impaired, duty of superintendent 17 in case part of original is withdrawn, no dividends ... 40 stock of shareholders may be sold to make good deficit, 2 tax on, for organization, banks exempt from 1 CERTIFICATES of association, what to contain 30 of incorporations to be filed and recorded 1 omissions in, of incorporations, how supplied 1 of authorization of trust companies to be filed 9 copies of papers certified by superintendent, evidence, 4 of residence of individual bankers to be filed 33 of associates of individual bankers to be filed 78 same to be evidence of partnership and liability 78 change in, of association, to be recorded and filed .... 34 of reduction of capital to be recorded and published . . 44 of amount of capital to be recorded and published. ... 51 of circulation destroyed to be made by agent 79 of names and residences of shareholders to be filed ... 1 of incorporation of foreign corporations, evidence .... 1 CHARTERS failure of bank to report, forfeits 33 of corporations, tow extended 1 CHECKS payable in lawful money 808 payable on specified day without grace 130 fixing time for payment of certain 1 holidays to be observed in payment of 1 for sums less than one dollar not' to be issued 306 notice to indorser of non-payment of 3 when protest not required for non-acceptance 3 CIRCULATIOIf — See Notes. banks not required to issue 113 CLERKS one to be appointed deputy superintendent 3 compensation of department, how paid 3 to receive pay for extra services a misdemeanor 7 acting as examiners entitled to actual expenses 13 to be appointed by superintendent, duties of 3 COMPTROLLER. to designate banks to receive State deposits 1 to appoint agent to examine securities held by supt. ... 9 to be furnished with lists of corporations 1 corporations to pay State tax to 331 PAGE. 196 27 11 35 334 203 21 230 218 334 4 23 43 43 23 27 30 44 215 249 16 219 161 68 185 183 161 186 186 63 3 3 5 233 6 189 169 484 Index. CONSTITUTION sbotion. page. provisions of, relating to corporations 391 CONTRACTS to be signed by president and cashier 59 33 CONVEYANCES of real estate to be mad# to corporation by name by the superintendent, how executed CORPORATIONS term ' ' moneyed corporation " defined term " domestic corporation " defined provisions of the Constitution relating to provisions of the Revised Statutes relating to certificates incorporating, to be recorded omissions in certificates incorporating, how supplied. . to pay tax on capital on organizing certain, exempt from organization tax fines imposed upon, how collected complaint in actions by or against capital to be paid in before commencing business . ... authorized to file affidavit of payment of capital to keep list of names of stockholders to file list of shareholders capital may be reduced when in excess of requirements, may sue and be sued in name of president charters of, may be extended not dissolved by death of stockholders protection of creditors of, against frauds production of books of, may be compelled account of moneys employed to be kept number of trustees may be reduced actions against directors of, for misconduct actions against, brought by attorney-general supervisors to famish comptroller with lists of not to interpose defense of usury in actions reduction of capital of domestic may issue duplicate certificates of stock criminal charges against, proceedings in proceedings on indictment of real estate that may be held and conveyed by authorized to purchase adjoining property may hold real estate in foreign countries prohibitions against certain loans preference in civil actions against when judgment may be taken against remedy when directors illegally hold over actions for dissolution of, when maintained attorney-general may bring action to annul charter . . . requisites of injunction against 38 35 4 3 214 108 8343 336 391 394 1 220 1 218 1 303 1 203 683 828 1775 801 193 103 1 130 308 106 1 315 1 196 1 197 1 319 1 199 1 30O 868 319 333 170 1 317 1781 303 1782 304 1 189 1 188 1 309 3 193 375 337 681 338 1 194 1 195 1 195 1 195 791 318 1778 303 1 311 1785 305 1797 309 1809 313 Index. 485 CORPORATIONS — Continued. section. notice of dissolution to be served on attorney -general . 8 when property is insufficient to pay debts 1794 appointment, compensation and duties of receivers ... 3 franchises of insolvent, rights of purchasers 1 to pay State tax to comptroller 331 property of, may be sequestrated for taxes 6 foreign, to keep list of shareholders 1 publication of notices of actions against foreign 1 certificate of incorporation of foreign, evidence 1 foreign may hold real estate in this State 1 DAYS OP GRACE certain commercial paper payable without 1 drafts payable on specified day, to be without 130 DEFICIENCY — See Capital. DEPOSITS certificates of, to be issued for actual deposits only . . . 117 certificates of, may be issued with or without interest. 117 certificates of, rate of interest on $5,000 or more 1 of securities to be made by banks on organizing 66 of securities may be changed 67 of securities to be surrendered by superintendent .... 109 of cash may be made as security for circulation 113 ■unclaimed, to be published by banks 35 unclaimed, of closed banks to be paid to treasurer .... 104 of corporations, subject to State tax 331 DEPUTY SUPERINTENDENT superintendent to designate a clerk as 3 powers and duties of, defined 3 compensation of, how paid 3 oath of office of 3 DIRECTORS articles of association to prescribe number of 58 provisions of Penal Code applicable to 594 term, as used in Penal Code defined 614 term, as used in banking laws defined. 816 of corporations, general duties of ; 179 to be chosen by shareholders. 195 by-laws regulating election of, to be published.... . . 307 remedy when election not held on appointed day 306 when new election of, may be ordered 211 redress of persons aggrieved at election of 310 liability of, for violations of law 188 actions against, for misconduct 1781 actions for removal of, brought by attorney-general. . , 1811 of certain corporations, number may be reduced 1 ineligible for election as inspectors 197 acts of, void when illegally holding over 1 PAGE. 353 808 350 306 169 203 347 257 349 348 186 68 65 65 187 36 37 61 63 17 57 169 3 3 3 3 33 337 343 109 96 103 106 106 107 107 101 303 314 317 103 311 486 Index. DIRECTORS — Continued. section. to fill vacancies in board of inspectors 196 to give notice of intention to reduce capital 43 to notify shareholders to make good tlie capital 1 in certain cases, may sell stock of shareholders 1 may supply omissions in certificate of incorporation . . 1 duties of, when bank proposes a change in location ... 2 duties of, when bank proposes a change of name 3 DIVIDENDS not to be made if capital is impaired 40 to be made from surplus profits only 179 additional, to be made on exempt stock 335 in case of insolvency, to be made within one year .... 147 when and how made by receivers 137 unclaimed, to be published by banks 35 DRAFTS to be payable in lawful money 308 not to be issued for less sums than one dollar 306 drawn at sight payable, without grace 3 payable on a specified day, without grace 130 notice to indorser of non-payment 3 when protest not required for non-acceptance 3 EVIDENCE OF DEBT term " evidence of debt " defined 318 judgment for non-payment of, when taken., 1778 EXAMINATION'S of banks of deposit and discount, when made 13 expenses of, how to be paid 13 to be made in case of consolidation 50 in certain cases reports of, may be published 13 perjury for witness to give false testimony on 13 of banks on failure to make reports 31 in case of reduction of capital stock 43 in case of impairment of capital stock 17 on application of creditors, court may direct 19 of books and securities in bank department 8 agent to make, how appointed 8 EXAMINERS appointment of, by superintendent 13 required to file oath of oflBce 13 ineligible for appointment as receivers 13 general powers and duties of 13 authorized to summon witnesses 14 to report result of examinations on oath 12 EXECUTIONS against corporations, return of unsatisfied 180 EXPENSES of the banking department, how paid g PAGE. 103 36 338 334 318 335 337 35 96 171 83 78 17 161 161 186 68 186 186 109 303 30 8 9 15 37 11 13 5 6 8 8 8 9 8 74 SECTION. PAGE. 21 15 74 41 9 6 4 176 Ikdex. 487 EXPBWrSES— Continued. of examinations of banks of deposit and discount. . . . of printing circulating notes of agent to examine securities of revision of the banking laws , FORGERY different degrees of, defined 509 339 FORMS certificate of association for State bank 263 instructions for organizing 266 outline of articles of aesociation 268 for converting National into State bank 264 affidavit of payment of capital 266 increase of capital stock 267 FRAUDS protection of creditors of corporations against 1 300 GUARANTEE COMPANY— See Tkust Company. HOLIDAYS tbose to be observed in tbis State April 30, 1889, designated a INDEMNITY COMPANY — See Tbust Company. INDIVIDUAL BANKERS certificate of residence of, to be filed superintendent to publish change of residence of having circulating notes cannot sell business business of, may be bequeathed business of, may be continued by legatee authorized to issue circulating notes notes of, to express individual liability only the word ' ' bank " to be printed on notes required to sign all notes issued to file certificate of persons interested with certificate to be evidence of partnership and liability. . may change location by order of court assessed for taxes on capital employed to be taxed at location of banking-house (In other respects individual bankers are subject to same regulations as Banking Associations, which see.) INJUNCTIONS in cases of insolvency of banks 131 75 INSPECTORS OF ELECTIONS for directors of corporations, how chosen general powers and duties of directors or officers ineligible for vacancies in board of, how filled oath of office of 1 183 1 184 32 33 33 33 64 35 65 36 65 36 73 41 76 43 77 43 76 43 78 43 78 43 1 335 320 168 330 168 195 103 199 104 197 103 196 103 198 104 488 Index. nfTEBEST SECTION. lawful rate of, fixed at sis per cent 68, 1 on loans exceeding $5,000 1 State and National banks on equality as to 69 penalty for taking more than six per cent 68 corporations not to interpose the defense of usury ... 1 JUDGMENTS how taken against banking associations 139 when taken against foreign corporations 1778 how enforced against stockholders 161 against stockholders, compromise of 159 how enforced against non-resident stockholders 157 enforceable against joint property of corporations 60 a lien on real and personal property 165 of court required to dissolve a corporation 1 proceedings if reversed or modified 153 stay of, in certain cases 129 against stockholders, sale of 159 property of bank sold by execution under 60 substance of certain, to be published 1803 final, to provide for just distribution 1793 LARCENY what constitutes the offense of 538 LAWS RELATING TO BANKS revision and compilation of, authorized 1 repeal of certain LIBEL what constitutes the offense of 34a publication of, a misdemeanor 343 LOAN COMPANY— See Tbust Company. LOCATION of banks may be changed by order of court 1 to be specified in certificate of association 30 of individual bankers to be filed 33 of individual bankers to be published 34 to be stated in reports, on oath 28 only at place specified in certificate of association 68 MONEYED CORPORATIONS term "moneyed corporation " defined 214 powers of, and regulations in relation to 179 capital of, to be paid in before commencing business. . 192 relating to election of directors of 195 dividends of, to be made from surplus profits only. . . . 179 MORTGAGE COMPANY — See Trust Company. NATIONAL BANKS organization of, in this State authorized 166 placed on equality with State banks 167 PAGE. 37, 181 187 38 38 188 74 302 87 86 86 33 89 199 85 74 86 83 311 308 334 175 176 328 329 225 21 23 17 19 35 108 96 103 108 89 90 Index. 489 NATIONAL BANKS— Continued section. page. State banks may be converted into 169 91 may be converted into State banks 177 94 NOTES Promissory. certain instruments deemed and taken to be 310 163 payable in lawful money 308 161 fixing time of payment of certain 1 185 holidays to be observed in presenting for payment. ... 1 183 given for unlawful purposes, void 301 159 when given for patent rights fact to be indicated 1 331 contents of lost may be proved by parol 1917 338 notice to iudorser of non-payment 3 186 judgments against corporations for non-payment of. . . 1778 303 Circulating. may be issued to banks on depositing securities 73 41 not to be issued to unsound banks 47 banks or individual bankers, not required to issue. . . . 113 63 required to be made payable on demand 73, 117 41, 65 public stocks to be deposited as security for 71 41 to be at all times secured in full 83 46 to be stamped ' ' secured by pledge of public stocks " . . 73 41 not to be issued for less denomination than one dollar, 189, 306 101, 161 of less denominations than $1,000, payable only at bank, 116 65 to be printed under direction of superintendent 70 40 stocks to be held solely as security for redemption, . . 84 47 to be numbered and registered in bank department ... 70 40 not to be countersigned beyond pledged securities .... 75 43 to express liability of banker issuing 76 43 to be signed by president and cashier 59 33 not to be issued until appointment of agent to redeem, 97 54 redemption agents to be appointed in writing 87 48 banks may appoint a common agent 99 55 agent to have an oflice in Albany, Troy or New York. . 86 48 list of redemption agents to be published 88 48 appointment of redemption agent may be revoked .... 98 55 penalty for refusal of agent to redeem 89 49 to discontinue issue of, on agent's refusal to redeem. . . 89 49 may be protested when redemption refused 110 63 damages for refusal to redeem, how collected 94 53 when returned to department for destruction 79 44 destruction of, to be witnessed and certified by agent . . 79 44 issued by unauthorized corporations, void 301 159 penalty for unauthorized issue of 398 159 authorized rate of discount in redeeming 90 49 if not received at par not to be circulated 115 64 mutilated, may be exchanged for new notes 81 45 penalty for mutilating or defacing 81 45 counterfeit, to be surrendered to superintendent 80 45 62 490 Index. NOTES — Continued. wliere and how protested for non-payment fees for protest of, how paid redemption of, to be advertised by superintendent. . . . securities to be sold for purpose of redeeming actions for refusal to redeem of closed banks to be destroyed those held by banks, how presented for redemption. . . when securities are insufficient for redemption if securities insuiiicieut to be redeemed pro rata . ... holder entitled to certificate if not paid in full if not presented six years after notice, cease to be Hen, of certain foreign banks not to be circulated may receive foreign, in regular course of business. . . . may pay out foreign, current at par penalty for circulating foreign NOTICES by superintendent, of call for quarterly reports by banks and bankers of intention to close business. . . of intention to close may b6 revoked to present circulating notes for redemption of place for presentation of notes for redemption to holders of notes of failed banks of change of residence of individual banker • of intention to reduce capital stock , to shareholders of assessment to make good deficit. . , to indorser, of non-payment of note of application for dissolution, how served , on consolidation of two or more banks of intention to change location of bank of intention to change corporate name by receivers, to creditors of insolvent banks , of appointment of referee of intention to organize a trust company providing for publication of legal and other providing for publication in Albany of certain OATH of oiiice of superintendent of office of deputy superintendent of office of examiners, to be filed of president and cashier to quarterly reports of president and cashier, as to location , of office of inspectors of elections of persons voting on proxies of individual banker before assessor of stockholders applying for deductions on tax of supervisors to lists of corporations SECTION. PAGE. 92 52 96 54 109 61 93 53 91 50 80 45 107 59 83 46 92 52 101 56 109 61 114 64 118 66 118 66 119 66 30 13 109 60 118 63 109 60 106 58 101 56 . 33 22 3 309 1 333 3 186 8 353 49 . 39 3 325 3 227 135 77 141 79 4 332 1 354 1 356 3 3 3 3 13 8 30 13 28 19 198 104 304 105 820 168 318 167 1 189 Index. 491 OFFICERS SECTION. PAGE. of banking associations, how chosen 35 23 not eligible for inspectors of elections for directors. . . 197 103 list of names and residences of, to be filed 1 315 of corporations not exempt from testifying 5 216 to sign contracts and circulating notes 59 83 may be examined under oath 13 9 penalty for refusal to submit to examination 16 10 two principal, to certify payment of capital 193 103 when required to exhibit list of shareholders 138 78 penalty for refusing to exhibit books to shareholders . . 209 107 to give notice of intention to change location of bank . 3 235 to make report to comptroller for State tax 333 169 to retain dividends for payment of State tax 315 166 OPINIONS BY THE ATTORNEY-GENERAL Banks and Individual Bankbks. full disclosure of afEairs of banks may be required 434 securities in which investments may be made 426 business to be transacted at banking-house only . 436 when deposits may be received at branch offices 429 relating to payment of capital of individual bankers 430 individual bankers not to use artificial name 430 superintendent not to execute duplicate assignments 431 capital stock of banks may be reduced while impaired, 433 personal liability of shareholders of Banks 433 directors liable for loss by unauthorized investments 438 time certificates of deposit with interest, not to be issued, 436 certificates of deposit to be non-negotiable 439 banks not subject to sec. 179 of chap. 409, Laws of 1882, 440 receivers of, to make reports to the superintendent 442 may deal in securities known as "evidence of debt " 442 certain law not applicable to private bankers 445 relating to the extension of charters of State banks 445 circulation of tickets representing money, unlawful 447 unlawful advertising as banks, how proceeded against 448 relating to the change of location of State banks 449 Trust, Loan and Mortgage Go's. relating to the Mutual Trust Company of New York 451 mortgages deposited in bank department by 452 additional deposit required on increase of capital 453 relating to American Emigrant Co. receiving deposits , 457 foreign trust companies receiving deposits in this State 464 relating to the Jarvis Conklin Mortgage Trust Co 464 foreign mortgage companies doing business in this State 476 PENALTIES FOR neglect to make good deficit in capital 17 11 failure to make quarterly reports 21,33 15 making dividends when capital is withdrawn 40 25 493 Index. PENALTIES FOE — Continued. section. taking usarious rate of interest refusing to exhibit names of stockholders refusing to exhibit transfer books, to shareholders advertising as a savings bank without authority neglecting to report names of oiEcers evasion of taxes by corporations neglecting to report to comptroller for taxation neglect of individual bankers to report parties interested, individual bankers issuing certain notes individual bankers neglect to file certificate of residence, countersigning notes beyond securities pledged mutilating or defacing circulating notes neglect to redeem circulating notes on demand violating laws relating to redemption of notes issuing notes not payable on demand paying out notes received at less than par circulating notes without authority circulating foreign bank notes PLATES AND DIES to be engraved under direction of superintendent to remain in custody of superintendent when to be destroyed by superintendent counterfeit, to be surrendered for destruction of banks changed to National system to be destroyed, list of destroyed, to be reported to the legislature PEOTESTS— See Notes. PEOXIES to have affidavit of stockholder attached persons voting on, maybe challenged REAL ESTATE that banks may purchase and hold. . > purposes for which banks may purchase corporations may hold, for business purposes corporations may purchase adjoining domestic corporations may hold, in foreign countries. . foreign corporations may hold, in this State owned by banks not exempt from taxation deductions for value of, in assessing stock RECEIVERS how and when appointed, duties defined general law relating to, of corporations application for appointment of, how made subject to certain provisions of Revised Statutes of insolvent banks, appointment of general powers and duties of additional powers and duties of 68 87 138 73 309 107 383 150 6 316 1 304 333 169 78 43 76 43 C3 32 75 42 81 45 89 49 108 60 117 65 115 64 00, 803 159, 160 119 67 70 40 • 74 41 80 45 80 45 174 93 80 45 203 105 304 105 38 34 37 34 1 194 1 195 1 195 1 348 313 164 313 164 1778 306 249 1 249 135 77 183 76 185 77 143 80 IlfDEX. 493 EECEIVERS — Continued. section. bank examiners ineligible for 13 attorney -general may apply for order removing 7 appeals brought by or against, have preference 10 of failed banks to convert securities into cash 136 to declare a dividend ■within ninety days 136 affairs of, to be closed within one year 6 clerk hire of, may be deducted from assets 146 required to report to superintendent annually 4 to report proceedings to court under oath 138 compensation of, how determined ; 3 compen.sation of, to be fixed by court 146 if removed to transfer assets to successor 163 to make report of unpaid debts and liabilities 138 to report names of stockholders of failed banks 139 to pay creditors in order prescribed by law 137 to make certain deductions before dividends 187 may retain assets sufficient to meet claims 147 by direction of court may sell judgments 164 may compromise judgments by order of court 159 REFEREE powers and duties of in certain cases 140 stockholders to be notified of appointment of 141 compensation of, to be fixed by court 146 to report apportionment of liabilities 143 order confirming report of, conclusive 633 when confirmed, report to be filed 144 REPORTS superintendent to designate day for making 20 banks to be notified of call for quarterly 20 quarterly, to be made on oath of president and cashier, 20 false swearing in respect to quarterly, perjury 20 quarterly, to be made within five days 21 when failure to, forfeits charter 22 quarterly, to be published at location of bank 20 examination to be made for failure to make 21 what items to be stated in quarterly 20 summary of quarterly to be published 20 of examiners to be made on oath 13 of examinations, when may be published 12, 15 by individual bankers as to residence 83 to specify location of banks and bankers 28 annual; of superintendent to legislature 27 of treasurer as to stocks transferred 123 by receivers, to court as to unpaid debts 188 by receiver as to names of shareholders 139 of names of shareholders of corporations 2 by corporations to comptroller, for taxation 323 253 353 77 78 251 83 251 78 250 78 79 78 78 83 79 79 82 80 315 81 13 13 13 14 15 16 14 15 14 14 8 8,10 33 19 18 68 78 79 215 169 494 Index. REVISED STATUTES section. provisions of, relating to corporations SAFE DEPOSIT COMPANIES number of corporators 1 objects of corporation 1 how incorporated ... 1 capital, minimum required 1 to be paid before commencing business 1 capital may be increased 1 declared bodies politic and corporate 2 capable of suing and being sued 3 affairs of, to be managed by trustees 3 stockbolders to elect trustees 3 stock of, personal estate 8 persona] liability of stockholders 9 to make semi-annual reports 10 superintendent to examine annually 12 to direct discontinuance of unsafe practices 14 remedy when rent of safes is not paid 15 proceedings in opening safes 15 goods on storage may be sold for charges 1 lieu of warehousemen defined 1 SAVINGS BANKS — Separately Indexed. See page 499. SEAL of office of the superintendent 4 may be impressed directly on paper 4, 960 SECURITIES — for circulation, see Notes. deposit of, as a guaranty of good faith 66 deposited with superintendent, may be changed 67 when interest on, may be withheld 66 that banks may purchase, enumerated 37 of insolvent banks to be converted into cash 186 treasurer to countersign transfers of 121 transfers of, not valid unless countersigned 121 record of transfers to be kept by treasurer 121 treasurer to make report of, transferred 123 SECURITY COMPANIES— See Tbott Company. STATE PAPER repeal of the act designating a 5 STOCKHOLDERS the term " stockholder " defined 126 liable for debts of the corporation 125 liability of, unchanged on reduction of capital 45 liability for debts contracted by corporation 125, 127 death of, not to dissolve corporation 47 actions against corporations not to abate on death of . . 3 shares of, may be sold to make good deficit in capital. . 2 PAGE. 294 279 379 279 279 380 380 380 380 380 280 283 282 383 383 384 285 385 386 288 3 4, 321 36 37 77 68 68 68 255 71 70 37 70,73 28 197 224 Ikdex. 495 STOCKHOLDERS — Continued. section. page. list of names of, to be kept and filed 46 28 names and residences of, to be entered in a book 138 72 book to be open for inspection during business tours . . 128 73 penalty for refusal to exhibit names of 128 73 shares of, deemed personal property 47 28 stock of, to be assessed as personal property 312 164 transfer of stock not to change liabilities of 47 28 assessment for deficit in capital, how enforced 3 323 may sue and be sued by the president 61 34 not entitled to set-offs in certain suits 62 ' 34 may reduce number of trustees of certain corporations, 1 317 may extend term of existence of corporation 1 219 may examine certain books of the corporation 209 107 issue of duplicates to replace lost certificates of stock, 3 193 authorized to elect directors and inspectors 195 103 remedy of, for wrong doings of directors - 3 313 remedy of, where directors fail to provide for elections, 3 213 location of bank to be changed with consent of 2 225 consent of, to be obtained on consolidation 50 29 liability of, not changed on consolidation 55 31 may dissent from consolidation 56 32 may apply for order declaring corporation insolvent . . 134 76 how judgments against, may be enforced 161 87 m.ay compromise with receiver, by leave of court 159 86 list of, of foreign moneyed corporations to be kept 1 347 non-resident, proceedings against, how taken 157, 162 86, 88 to be taxed on shares of stock owned 313 164 to be taxed at location of bank, not elsewhere 313 164 entitled to deductions in taxation of stock 312 164 shares subject to lien for taxes 314 166 proceedings for collection of tax on stock of 315 166 non-resident, taxation of stock of 314 165 stock of non-resident, may be sold for tax 314 165 SUPERINTENDENT of the banking department, how appointed 2 2 oath of office and bond of 3 3 salary of, to be paid quarterly 3 3 powers and duties of, defined 3 3 seal of office of the 4 3 salary and expenses of, how defrayed 6 4 suitable rooms to be assigned to 5 4 not to receive compensation for extra services 7 5 prohibited from being interested in any bank 3 3 to make annual reports to legislature 37 18 to ascertain if capital of banks has been paid 18 11 ■ to issue certificates of authority to do business to banks, 18 12 to designate time for banks to make quarterly reports, 30 13 duty of, on discovering capital of bank is impaired. . . 1 233 496 Index. SUPERINTEKDElfT — Continued. section. page. examination of banks to be in discretion of 12 7 duty of, on banls; refusing to be examined 16 10 to make examination for reduction of capital 43 37 to determine amount of reduced capital 43 27 to certify amount of capital of consolidated bank 50 30 to pay certain unclaimed balances into treasury 10 7 to have access to transfer books of treasurer 134 69 to hold securities for redemption of circulation 84 47 to withhold notes and interest when bank insolvent ... 85 47 when to sell securities held for redemption of notes. .. 101 56 may grant power of attorney to collect interest on stocks, 83 46 when to retain interest or dividends on trust fund ... 83 46 circulating notes to be printed under direction of 70 40 to countersign, number and register circulating notes, 70 40 not to countersign notes beyond securities deposited ... 75 43 to receive securities and distribute circulating notes. .. 71 41 to procure plates and dies and retain custody of same, 74 41 to colLeut the expenses of printing notes 74 41 penalty for over-issue of circulating notes 75 43 to destroy notes in presence of agent of bank 79 44 to destroy note plates of closed banks 80 45 to give final notice for presentation of notes 101 56 to publish notice for redemption of notes 109 61 to surrender funds held after expiration of notice 109 61 to surrender securities in proportion to notes cancelled, 111 62 may receive cash deposit as security for notes 113 68 in case of insolvency to con vert securities into cash .. . 136 77 duties of, in relation to trust companies, ^ee page 497.. 319 110 to examine trust companies annually 331 111 may publish reports made by trust companies 220 111 on examinations may summon witnesses 331 113 to assess expense of examination of trust companies. . . 231 113 duty of, in cases of violations of law 333 113 duty of, when trust company refuses to make deposit, 335 114 to assess trust companies for department expenses. . . . 836 115 to examine trust company for reduction of capital.... 339 116 duty of, when capital of trust company is impaired. . . 333 118 to report condition of trust companies to legislature . . . 334 119 TAXATION corporations subject to, for privilege of organizing 1 203 State and National banks on equality in regard to ... . 318 167 moneys collected from, to be paid into treasury 837 171 banks to keep list of stockholders for purpose of 313 165 assessment of bank stock for purpose of 315 166 of bank stock, deductions to be allowed 313 164 bank stock to be assessed as personal property for. ... 313 164 bank stock not to be assessed higher than other capital, 313 164 bank stock to be assessed at location of bank 313 X64 Index. 497 TAXATION — Continued. section. oath of shareliolder applying for deductions 318 exemptions from, not for benefit of bank 326 sale of stock of non-resident shareholder 314 relating to, of incorporated companies 3 collection of, from delinquent corporations 1 certain assessments of banks confirmed 316 TBEASUEER to countersign certain transfers of stocks 121 certain transfers not valid unless countersigned by. . .. 121 to have access to transfer books in bank department . . 124 superintendent to have access to transfer book kept by, 124 to notify banks of transfer of their securities 121 to report transfers made, to the legislature 122 TRUST COMPANIES the term " trust company " defined 37 may be organized under general law 1 certificate of organization, contents of 2 certificate to be acknowledged and filed 3 publication of notice of intention to organize ' 4 notice to be sent to companies in same city 4 superintendent to file certificate ' ' for examination "... 5 superintendent may refuse to file if incomplete 5 certain facts to be ascertained by superintendent 8 may be authorized to commence business 8 superintendent may refuse to authorize 10 if authorized, to be a body corporate and politic 11 superintendent to ascertain if capital is paid 12 to file list of shareholders before doing business 13 affairs to be managed by a board of trustees 14 manner and time of electing trustees 14 powers and duties of trustees defined 18 capital, minimum amount authorized 19 capital may be increased from time to time 19 securities in which capital is to be invested 20 powers, functions and liabilities of 21 in certain cases not required to give a bond 26 trustees have discretionary powers in investing funds. . 27 loans to trustees of, prohibited 28 individual liability of stockholders of 29 number of trustees of, may be reduced 31 to make reports to superintendent 219, 32 proceedings to change corporate name of 34 reservations as to powers conferred 35 reports of, may be published by superintendent 220 examinations of, to be made annually 221 expense of examinations, how paid 321 facts to be ascertained on examinations 222 63 ,. PAGE. 167 171 165 201 204 166 68 68 69 69 68 69 246 280 231 231 332 232 232 332 233 233 234 234 234 235 335 235 237 237 238 238 238 242 242 243 343 244 110, 344 345 246 111 111 113 113 498 Index. TEUST COMPAKTES— Continued. section. page. proceedings against, for violations of law 223 113 to deposit ten per cent of capital with superintendent. . - 224 113 to pay portion of expense of banking department 226 115 may invest in certain stocks though charter forbids. . . 1 329 restrictions as to deposits and loans 327 115 capital stock of, may be reduced 338 115 notice on, and method of reducing capital 329 116 examination in case of reducing capital 229 116 certificate of reduced capital to be published 230 117 rights of stockholders and creditors unchanged 281 117 capital stock may be increased, method thereon 333 117 proceedings in case capital is impaired ... . , 338 118 appointment of, as trustee of lunatics, idiots, etc 1 229 authorized to change corporate name 1 227 subject to taxation, method of assessment 324 170 foreign, refusing to deposit securities 225 114 superintendent to report condition of, to legislature. . . 384 119 compilation and revision of laws relating to 1 175 repeal of certain laws relating to 176 TTNAUTHORIZED BANKING- general prohibitions against 297 158 penalty for unauthorized use of title of " bank " 311 163 USURY taking more than six per "cent interest, deemed 68 38 taking of, defined by the Penal Code 378 339 taking of, a misdemeanor 378 829 corporations not to interpose defense of 1 188 causes of actions for, may be transferred 1911 323 WITNESSES examiners may summon persons as 14, 331 9, 111 penalty for, refusing to appear or answer 14, 331 9, 111 Il^DEX TO SAVIlSrGS BANK LAWS. ACT SBCTIOK. the savings bank law declared a public act 389 ASSOCIATION certificate of association 237 what to contain and how executed 237 to be filed in the bank department 238 ATTORNEY-GENEBAL maj- proceed against a savings bank for neglect to invest 262 also upon facts reported by superintendent 278 may apply for order removing receiver 7 AUTHOEIZATIOlf — See Sttpbrintendbnt. certificate of 243 to be issued within sixty days 243 to whom to be issued 243 to be transmitted to county clerk 244 duplicate to be filed in bank department 244 superintendent may refuse to issue 245 county clerk to be notified of refusal to grant 245 when granted, in whom powers-are vested 346 persons named in, to be the first trustees 249 AVAILABLE FUND how to be kept or loaned 261 BANK BUILDING — See Ebal Estate. BANKING DEPARTMENT — See Supekintendbnt. BANKS OP DISCOUNT temporary deposits may be made in, by savings banks. 263 available fund may be kept on deposit with 261 savings banks are preferred creditors of 282 not to solicit or receive deposits as savings banks 288 PAGE. 154 122 133 123 135 146 253 125 124 124 125 125 125 125 126 137 134 135 134 149 150 500 Index. BY-LAWS AND REGULATIONS sbctiok. page. may be made by trustees 351 137 deposits and dividends to be repaid as trustees prescribe 357 130 regulations to be posted in banking room 357 130 superintendent to be notified of amendments to 351 128 CERTIFICATE OP ASSOCIATION — See Association. CHARTERS — See Corpobations. conformation of, to this act 286 152 CONSTITUTION provisions of the, relating to corporations 391 CLERKS in department, to be appointed by superintendent 280 149 salaries of, to be paid monthly 280 149 names and compensation to be reported to legislature . 280 149 compensation of, in banks to be fixed by trustees 254 129 trustees may require bonds of fidelity of 254 129 CONTRIBUTIONS by savings banks for expenses of bank department 281 149 CORPORATIONS, SAVINGS provisions of the Constitution relating to 291 provisions of the Revised Statutes relating to 294 declared corporations with general powers 235 121 to have perpetual succession 235 121 may sue and be sued 235 121 may make and use a common seal , 235 121 may appoint officers and agents 235 121 may make by-laws 235 131 may contract and be contracted with 235 121 may receive deposits and invest the same 235 121 duties before receiving deposits 247 126 to commence business within one year 248 126 name of, may be changed 285 151 conformity of charters not to affect prior legal rights. . 286 152 misnomer of, not to impair certain instruments 288 153 may close voluntarily 293 155 COUNTY CLERE — See Superintendent. certificate of association to be filed with 238 122 certificate of authorization to be filed with 244 125 superintendent's refusal to issue certificate to be filed, 245 125 extension of time for commencing business to be filed, 248 126 approval of change of name to be filed with 285 151 COUPON BONDS of New York city may be changed to registered 1 257 general law relating to registry of 1 258 Index. 501 COURT SECTION. PAGE. duty of, in action for the recovery of money 359 131 duty of, in proceedings by attorney-general 378 146 superintendent, by direction of, may take possession.. 278 147 may adj udge f rancbises surrendered 394 156 DEPOSITS duty of corporation before receiving 347 136 of money may be received and invested 256 130 and dividends to be repaid as trustees prescribe 257 130 may be limited, refused or returned 257 130 single, not to exceed $5,000 257 180 single, not to exceed $3,000 290 154 in name of female or minors, to whom payable 258 131 in trust, may be paid to principal 258 131 claimants of, may be made parties defendant 359 131 certificates, or evidences of, binding without seal 387 153 prohibition against the unauthorized receiving of. . . 383 150 DEPOSITS BY SAVINGS BANKS may be made with banks or trust companies 261 134 uninvested moneys may be temporarily deposited 263 135 in banks or trust companies, on becoming insolvent. . 283 149 DIVIDENDS OB, INTEREST may be declared, credited and paid on deposits 256 130 and deposits to be repaid as prescribed by trustees .... 257 130 not to exceed five per cent 267 139 depositors may be classified with respect to 367 140' in excess of profits, trustees liable for 367 140 to be declared only upon vote of board of trustees 267 140 only for the time moneys have been on deposit 367 140 extra, may be declared 367 141 change in rate to be posted in banking-house 367 141 EVIDENCE — See Deposit. of deposit 387 153 EXAMINATIONS — See Stjpekintendent. savings banks subject only to, by bank superintendent, 275 144 of savings banks to be made once in two years 277 145 expenses of special, to be paid by bank examined 277 145 result of special, to be certified by examiners 377 145 regular, to be embodied in report of superintendent. . . 377 146 unsafe practices discovered on 378 146 to be made semi-annually by trustees 279 148 EXAMINERS may be appointed by superintendent 380 149 salaries and expenses of, how paid 380 149 may compel attendance of persons and papers 277 145 to certify result of special examinations 277 145 SECTION. PAGE. 364 137 365 137 374 144 377 145 380 149 381 149 502 Index. EXPENSES of perfecting mortgage papers, paid by borrower of reinsurance of mortgaged premises, bow paid penalties collected for fines, to be paid into treasury. . of special examinations, bow paid salaries of clerks and examiners, bow paid of bank department to be assessed on savings banks. . FEMALE — See Deposits. FORMS certificate of association for savings bank 375 INSUBANCE of mortgaged premises to be made payable to bank . . . 865 137 if neglected by mortgagor may be renewed by bank . . 865 137 INTEREST — See Dividbnds. INVESTMENTS may be made only as authorized to be made as soon as practicable legally made, prior to 1875, not afEected LOANS from tbe available fund upon notes, drafts or personal securities, unlawful . upon bonds and mortgages expense of effecting, to be paid by borrower LOCATION may be changed with approval of superintendent. . . proceedings to effect change of MEETINGS — See Tktjstbes. MINORS — See Deposits. NAME of savings bank how changed 385 151 NOTICE of intention to organize, to be published of refusal to grant certificate, to be filed of change of rate of interest to be posted in bank intention to apply for change of name, to be published . . OFFICERS to be chosen by trustees powers and duties of, to be prescribed by trustees compensation of, to be fixed by trustees security for fidelity of, may be required not to borrow the funds of the corporation not to become surety for money loaned by the bank . . . prohibitions against dealing in notes, exchanges, etc., two principal, to verify reports to superintendent. .... a misdemeanor to make certain investments 860 133 361 134 386 153 361 135 864 137 864 137 864 137 868 137 363 137 339 133 345 135 867 141 885 151 351 137 351 187 354 139 354 139 855 139 855 130 866 138 373 143 386 153 Index. 503 OPrNIONS BY THE ATTORNEY-GENERAL. superintendent to interfere to stop unlawful practices. . deposits with savings banks not liable to taxation. . .. interest on deposits withdrawn prior to interest period, debtors to savings banks are ineligible for trustees failure to perform duties vacates office of trustee powers, duties and liabilities of trustees defined minimum number of trustees required by-law fixing time for meetings sufficient notice on deposits made within ten days of an interest period. . penalty for failure to make semi-annual reports term " trust fund," how construed in fixing officers' salaries, how board constituted surplus may be invested same as deposits method of estimating the surplus of savings banks . . . constitutionality an act to tax savings banks order of court required for dissolution of savings banks, relating to prohibition against ' ' indirect interest " . . . . acceptance of corporate or official searches optional . . . acceptance of searches of title companies optional . . . may employ counsel through title companies relating to unclaimed dividends of failed banks in relation to extending time for sale of real estate . . . the Charity Organization Society may receive deposits, all funds to be invested in accordance with law bonds of the State of Indiana a lawful investment bonds of the State of Missouri a lawful investment. . . . Prohibitions Against. purchase of certain real estate investment in 5 per ct. bonds of District of Columbia. . . investment in bonds of the State of Minnesota investment in mortgage bonds of private corporations., savings banks of this State delegating their powers. .. the receiving of special deposits of valuables, for hire, savings banks borrowing money on pledge of securities, investment in bonds issued by the State of Georgia. .. investment in bonds issued by the State of Alabama. . the making of loans to highway commissioners making time deposits with banks or trust companies . . paying unearned salaries of deceased officers paying premiums on bonds given by employees making voluntary contributions for public benefit the use of established surplus to increase dividends. . ORGANIZATION what necessary to perfect notice of intention to organize to be published failure to commence business in one year forfeits rights. SECTION. PAGE. 345 346 346 347 348 349 353 367 368 369 370 371 373 372 375 408 409 403 413 413 414 ...... 417 419 430 376 390 352 355 361 363 356 365 367 383 393 394 397 399 400 401 415 236 121 339 122 348 136 504 IXDEX. PENALTY SECTION. page. for failure to report to superintendent. 9'H 144 for banks or individuals soliciting savings deposits. . . 383 150 PERJURY false swearing in regard to reports, deemed 273 143 PROHIBITIONS AGAINST certain persons being named in certificate 243 125 trustees being connected witli other savings banks 253 12S trustees borrowing the funds of the bank 255 129 trustees having interest in profits of the bank 255 129 trustees receiving pay for services as such 255 129 single deposits exceeding |5,000 257 130 receiving deposit or deposits in excess of $3.000 290 154 excessive deposits with banks or tru'st companies.... 261 135 loaning more than ninety per cent on securities 261 135 cost of banking-house exceeding sum limited _ 263 136 holding real estate longer than five years 263 136 loaning upon notes or personal securities 264 137 trading in real estate, goods or other commodities 266 138 dealing in notes, time bills of exchange, etc 266 188 issuing certificates of deposit 266 139 payment of interest except regular dividends 266 139 paying deposits without production of pass-book 266 189 allowing interest for longer than moneys are held . . 267 140 payment of dividends except on vote of trustees 267 140 trustees receiving pay for attending meetings 269 142 banks or individuals soliciting savings deposits 283 150 investments in unauthorized securities 286 135 PROFITS— See Dividends. QUORUM not less than seven trustees to constitute 252 128 president or vice-president to form one of 252 128 less than, may adjourn from time to time 252 128 REAL ESTATE cost of banking-house limited 263 136 to be sold within five years 263 136 time for sale of, may be extended ■. . . . 263 136 investments in, to be made subject to law 260 133 loans upon, to be on bond and mortgage 264 137 loans on, to be insured when buildings are included. . 265 137 unlawful to deal or trade in, except as authorized 266 138 RECEIVERS duties of (see also chap. 378, Laws of 1883) 278 147 application for appointment of, how made 1 249 compensation of, how fixed 2 250 to make reports to superintendent 4 351 affairs of to be closed in one year. 6 251 Index. 505 BECEIVERS — Continued. section. proceedings for removal of 7 appeals by or against, have preference 10 to transfer unclaimed balances to superintendent 395 when may be discharged 295 REGULATIONS — See By-Laws. REPORTS to be made to superintendent semi-annually 270 to be verified by two principal officers 273 information which, are required to contain 371, 373 false swearing concerning, deemed perjury 373 penalty for failure to report 274 time for making, may be extended 274 no other, than to superintendent required 375 by superintendent to legislature 376 when from, illegal and unsafe business is discovered. . 378 of assets to be based on examination by trustees 379 to state that balances of ledgers have been taken . . . 279 REVISED STATUTES provisions of, relating to corporations SUPERINTENDENT OP BANK DEPARTMENT copy of certificate of association to be filed in office of, 238 to indorse same "filed for examination " 340 may refuse to file certificate if incomplete 241 to ascertain prospects of success for new bank 243 may issue certificate of authorization within sixty days, 243 to transmit copy of certificate to county clerk 344 when may refuse to issue certificate of authorization . . 245 notice of refusal to issue to be filed with county clerk, 245 information to be filed before receiving deposits 347 may extend time for commencing business 348 copy of by-laws to be transmitted to 351 to report violations of law to attorney-general 363, 278 permission of, to erect a banking-house 363 may extend time for sale of real estate 263 to approve change of location of savings banks 363 to direct discontinuance of payments in certain cases. . 266 duty of, in determining per cent of surplus 368 form and contents of reports, to be made to 370 penalties, how recovered by 874 may extend time for making reports 274 to report to the legislature annually 276 to examine savings banks once in two years 377 to direct discontinuance of unsafe practices 378 to communicate certain facts to attorney-general 378 if court directs, may take possession of a savings bank, 378 may employ necessary clerks and examiners 380 expenses of, how paid 381 64 PAGE. 353 353 157 156 143 143 143, 143 143 144 144 144 145 146 148 148 394 122 123 133 134 135 133 126 136 136 136 137 135, 146 136 136 137 139 141 142 144 144 144 145 146 146 147 149 149 CEOTION. PAGE. 285 151 395 156 396 157 367 140 368 141 5G6 Index. SUPT. OP BANK I?EPAET]VLENT — Continued. may authorize cliange of name of savings banks to receive and receipt for unclaimed balances may pay unclaimed balances to depositors SUEPLITS FUND of fifteen per cent may be accumulated , how determined TAXATION savings banks exempt from 4 303 TBTTST COMPANIES — See page 497. TRUSTEES persons named in certificate of organization to be first. . to have the management of the corporation board of, not to be less than thirteen vacancies in board of, how filled board of, to make by-laws regular meetings of, to be held monthly not less than seven a quorum when office of, becomes vacant in certain cases, eligible to re-election to hold office in but one savings bank , not to be interested in profits of the bank not to receive pay for services as may receive compensation when acting as officers not to borrow the moneys of the bank not to become surety for money borrowed of the bank, may require security from officers and clerks to invest deposits only as authorized by law to certify value of premises to be mortgaged to invest deposits as soon as practicable on depreciation of secarlties held for loans to apply for extension of time for sale of real estate . . not to loan on notes, exchanges, etc non-residents of the State ineligible removal from State, vacates office of may pay deposits when pass-books cannot be produced. . to regulate rate of interest not to exceed five per cent. . may accumulate a surplus fund of fifteen per cent .... may classify depositors dividends to be declared on vote of only once in three years may make extra dividends committee of, to make semi-annual examination number of, may be reduced number of, may be increased a misdemeanor to make unauthorized investments action to be taken by, in voluntary liquidation to transfer unclaimed balances iu closing bank 349 127 349 127 350 137 250 127 351 137 352 138 353 138 353 129 353 129 353 129 355 129 255 139 269 141 255 129 355 130 354 139 360 133 360 134 361 134 361 135 368 186 364 137 291 154 291 154 366 139 367 139 367 140 367 ■ 140 367 140 367 141 279 148 284 151 384 151 386 153 293 155 394 156