not exceeding the rate of six per centum per annum, to the amount so required or authorized to be paid or applied, and deliver the same to the said treasurer, who shall thereupon cancel an equal amount of certificates of stock heretofore issued to him in trust for the said fund, under chapter two hundred and seventy-four of the laws of eighteen hundred and thirty-three, and chapter one hundred and two of the laws of eighteen hundred and thirty-seven. CHAP. XX. may be exthe bills of banks re redeemed. $2. The Comptroller and Treasurer may exchange any such Such stock transferable certificates of stock for the bills or notes of any changed for banking corporation which the Comptroller may be so required certain or authorized to pay or redeem, or may sell and dispose of quired to be such certificates of stock on the best terms which can be obtained; and the Comptroller shall apply the proceeds thereof to the redemption of such notes or bills, in such manner as he may deem most effectual to prevent any loss to the holders of such bills or notes from a depreciation of value thereof. Any premium obtained on the exchange or sale of such stock, shall belong to the general fund. $3. It shall be lawful for any bank within this state to exchange any bills which the Comptroller may be required to redeem with the moneys belonging to the bank fund, for any stock to be issued by virtue of this act; and also to purchase, hold and dispose of such stock, which shall not be deemed to constitute any portion of the loans or discounts of such bank. CHAP. 292. AN ACT to prevent fraudulent practices in the management of moneyed incorporations, and to provide for a prompt replenishing of the safety fund. PASSED May 26, 1841. The People of the State of New York, represented in Senate and Assembly, do enact as follows: Banks may such bills exchange for said stock. which bank be hypothe $1. It shall not be lawful for any moneyed corporation Amount to having banking powers, and subject to the provisions of the notes may safety fund act, to hypothecate or pledge its own notes, or cated." bills, designed for circulation as security for any money borrowed, or money paid or advanced for its use, beyond an amount which added to its bank notes then in actual circulation, shall exceed the sum which the said bank may lawfully issue. guarantees ments. $2. No such moneyed corporation shall guarantee or en- Amount of dorse, so as to become liable upon any of its discounted notes, and endors bills or obligations, beyond the sum which added to its other loans and discounts shall exceed the amount of loans and discounts which such corporation may legally make. 13 N. Y., 315; 21 B., 643. PART L What bills to be deem lation. $3. All bank bills or circulating notes of every such ed in circu- moneyed corporation which are not in the possession of such corporation, or of its agent or correspondent for its own exclusive use and benefit, and subject to its unconditional order and disposal, shall be deemed and hereby are declared to be in circulation, and shall in all cases be included in its accounts and otherwise, as bills in circulation. violation of sections. Penalty for S4. Any officer of any such moneyed corporation who shall preceding intentionally violate any part of the provisions of the preceding sections, shall be deemed and adjudged guilty of a misdemeanor, and shall upon conviction be fined at the discretion of the court, not exceeding one thousand dollars, or imprisoned in a county jail not less than six nor more than twelve months, or both. Safety fund how replenished. Banks advancing reimburs ed. $5. Whenever the Comptroller shall lawfully apply any moneys belonging to the safety fund to the payment of the debts of any banking corporation, the safety fund shall be reduced by the amount of the moneys so applied below the sum required in the fourth section of the act entitled "An act to create a fund for the benefit of creditors of certain moneyed corporations, and for other purposes;" and in such case every moneyed corporation which shall be subject to said act, shall, on or before the first day of January in every year thereafter, pay to the Treasurer of this state such sum as may be required by the Comptroller, not exceeding one half of one per cent on its capital stock, as provided in said act. Such annual payments shall continue to be made by every corporation subject to said act, until the aforesaid fund shall be reimbursed and made to amount to the sum provided in the fourth section of said act; after which such annual payments shall be suspended until it shall become necessary again to resort to the said fund for the payment of the debts of any other corporation which may become insolvent, in which case the said payments shall be resumed in manner aforesaid, and so on from time to time as occasion may require. $ 6. Corporations which shall have paid to the Treasurer money how any moneys as required in the last preceding section for the purpose of reimbursing said fund shall be considered creditors of any bank (for the redemption of whose notes the said fund had been reduced,) to the amount of their respective contributions to the fund for said purpose, and shall be entitled to receive their proportion of the moneys to be distributed by the receiver of said insolvent bank to the amount so paid by them respectively, unless at the time of such distribution the safety fund shall not have been replenished as provided in the last preceding section, in which case such moneys, or so much thereof as shall be sufficient to replenish said fund, shall be paid to the Treasurer of this state for the benefit of said safety fund, and the excess only shall be so distributed. Dividends $ 7. If the bank commissioners shall at any time upon exaWhen they mination believe the assets of any such moneyed corporation upon banks CHAP. XX. to be pub Session to be of a doubtful character, so as in any degree to impair may be pro its capital, they may in their discretion prohibit any such cor- hibited." poration from making any dividend for such period as they may deem prudent, and the safety of the public may require. $8. It shall be the duty of the Secretary of State to publish Certain acts with the Session Laws for the year 1841, a chapter containing lished in the "Act to create a fund for the benefit of the creditors of Laws. certain moneyed corporations, and for other purposes," passed April 2, 1829, as amended by subsequent enactments, showing in a corrected and condensed form, the provisions of law at present in operation affecting the institutions now doing business under the said acts. A chapter containing the act to authorize the business of banking, passed April 18, 1838, as amended by subsequent enactments, showing the provisions of law at present in operation, affecting the associations or individuals now doing business under the said acts. Prepared and published pursuant to section 10 of chap. 319, Laws of 1841. CHAP. 260. AN ACT to authorize the business of banking. PASSED April 18, 1838. The People of the State of New York, represented in Senate and Assembly, do enact as follows : ler to pro $1. The Comptroller is hereby authorized and required to Comptrolcause to be engraved and printed in the best manner to guard vide circuagainst counterfeiting, such quantity of circulating notes, in lating notes the similitude of bank notes in blank, of the different denominations authorized to be issued by the incorporated banks of this state, as he may from time to time deem necessary to carry into effect the provisions of this act, and of such form as he may prescribe. Such blank, circulating notes shall be Which are countersigned, numbered and registered in proper books to be tersigned provided and kept for that purpose in the office of said Comp- tered in his troller, under his direction, by such person or persons as the office. said Comptroller shall appoint for that purpose, so that each denomination of such circulating notes shall bear the uniform signature of such register, or one of such registers. [Original section 1 varied by section 6 of ch. 319, Laws of 1841, by omitting the words "all be of the same similitude and" in the latter part of the section.] 19 N. Y., 37, 245; 17 N. Y., 521; 15 N. Y., 9; 9 N. Y., 486; 7 N. Y., 516, 541; 5 N. Y., 393; 18 B., 456; 17 B., 320; 8 B., 225; 5 B., 9, 186; 2 D., 280; 7 H., 504; 6 H., 370; 4 H., 20, 442; 3 H., 388; 2 H., 295; 1 H., 11, 616; 25 W., 605, 686; 23 W., 103; 22 W., 9: 3 S. Ch., 466; 2 S. Ch., 23; 1 S. Ch., 179, 207, 693; 4 Ed., 134; 3 Ed., 395; 3 Bos., 346. to be coun and regis of stock of S2. Whenever any person or association of persons, formed on transfer for the purpose of banking, under the provisions of this act, this state PART L notes to be circulating shall lawfully transfer to the Comptroller any portion of the delivered. public stock issued or to be issued by this state, such person or association of persons, shall be entitled to receive from the Comptroller an equal amount of such circulating notes of different denominations, registered and countersigned as aforesaid; but such public stock shall in all cases be, or be made to be, equal to a stock of this state producing five per cent per annum ; and it shall not be lawful for the Comptroller to take such stock at a rate above its par value, nor above its current market value. When notes may be circulated [Original section 2 varied by section 2 of ch. 363, Laws of 1840, by omitting what related to stocks created by other states or by the United States.] 14 N. Y., 162; 7 N. Y., 328; 18 B., 456; 8 B., 436; 4 Ed., 134; H. and D., 271. $ 3. Such person or association of persons are hereby authorized, after having executed and signed such circulating notes as money. in the manner required by law to make them obligatory promissory notes payable on demand, at the place of business within this state, of such person or association, to loan and circulate the same as money, according to the ordinary course of banking business, as regulated by the laws and usages of this state. : If notes not paid on de and, to be redeemed by comp trust iunds. 15 N. Y., 211. $4. In case the maker or makers of any such circulating note or notes countersigned and registered as aforesaid, shall at any time hereafter, on lawful demand, during the usual troller with 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 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 for non-payment by a notary public under his seal of office in the usual manner; and the Comptroller, on receiving and filing in his office such protest, shall forthwith give notice in writing to the maker or makers of such note or notes to pay the same; and if he or they shall omit to do so for ten days after such notice, the Comptroller shall immediately thereupon (unless he shall be satisfied that there is a good and legal defence 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 Comptroller shall be required to apply the said trust funds belonging to the maker or makers of such protested notes to the payment pro rata of all such circulating notes, whether protested or not, put in circulation by the maker or makers of such protested notes, pursuant to the provisions of this act, and to adopt such measures for the payment of such notes, as will in his opinion most effectually prevent loss to the holders thereof. See Laws of 1851, ch. 203; 9 Pai., 357. CHAP. XX. be given to receive di trust funds. or trans $5. The Comptroller may give to any person or association Powers of persons so transferring stock in pursuance of the provi- attorney to sions of this act, powers of attorney to receive interest or owners to dividends thereon, which such person or association may vidends on receive and apply to their own use; but such powers may be when to be revoked upon such person or association failing to redeem the revoked. circulating notes so issued, or whenever, in the opinion of the Comptroller, the principal of such stock shall become insuffi- Stocks may cient security; and the said Comptroller, upon the application be changed of the owner or owners of such transferred stock in trust, ferred. may, in his discretion, change or transfer the same for other stocks of the kinds before specified in this act, or may retransfer the said stocks, or any part thereof, or the mortgages, or any of them hereinafter mentioned and provided for, upon receiving and canceling an equal amount of such circulating notes delivered by him to such person or association, in such manner that the circulating notes shall always be secured in full either by stocks or by stocks and mortgages, as in this act provided. $6. The bills or notes so to be countersigned, and the pay- Bills how to ment of which shall be so secured by the transfer of public stocks, shall be stamped on their face, "Secured by the pledge of public stocks." mortgages for one half livered. $7. Instead of transferring public stocks as aforesaid to Bonds and secure the whole amount of such bills or notes, it shall be to be taken lawful for such person or association of persons, in case they of notes deshall so elect before receiving any of the said bills or notes, to secure the payment of one half of the whole amount so to be issued, by transferring to the Comptroller bonds and mortgages upon real estate, bearing at least six per cent interest of this state, payable annually or semi-annually; in to be which case all such bills or notes issued by the said person or stamped in association of persons, shall be stamped on their face, "Secured by pledge of public stocks and real estate." 19 N. Y., 163. How bills such case. of mort and value of $ 8. Such mortgages shall be only upon improved, produc- Character tive, unincumbered lands within this state, worth indepen- gages, title dently of any buildings thereon, at least double the amount lands, how for which they shall be so mortgaged; and the Comptroller ascertained shall prescribe such regulations for ascertaining the title and the value of such lands as he may deem necessary; and such mortgages shall be payable within such time as the Comptroller may direct. When bond gages may and mort be reassign when prin $9. The Comptroller may, in his discretion, reassign the said bonds and mortgages, or any of them, to the person or association who transferred the same, on receiving other approved ed." bonds and mortgages of equal amount; and when any sum Proceeding of the principal of the bonds and mortgages transferred to cipal of the Comptroller shall be paid to him, he shall notify the per- is paid to son or association that transferred the bonds and mortgages comptroller of such payment, and may pay the same to such person or trust fund |