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And Presented February 14, 1893 

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THE BANKING SYSTEM 



STATE OP iraiW YORK 



INCLUDIMS ALSO THE 



ACT OF CONGRESS ESTABLISHING, JUNE 3d, 1864, 



NATIONAL BANKING SYSTEM. 



THE 



BMKING SYSTEM 



STATE OF NEW YORK, 



WITH NOTES AND RBFERBNCBS TO 



j^DJUDQED OiLSES: 



IimjrilINiVLS)) T«^ 



ACT OP CONGRESS OFJl^^si 186*, ESTABLISHING OR 

ppovra^ For A\'X,«^ 

NATIONAL BANKING SYSTEM. 



JOHN^E AVELAND, 

COUNSELIOR AT LAW. 



SECOND EUIXION; 

BT 

G. S. HUTCHINSON, 

COUNSELLOE AT LAW. 



NEW YORK: 
,JOHN S. VOORHIES, LAW BOOKSELLER AND PUBLISHER, 

20 NASSAU STREET. 
1864. 



Entered, according to Act of Congregs, in the year 1864, by 

JOHN S. TOOBHIEIS, 

In the Clerk's Office of the Distiict Court of the United States for the Southern District 

of New Yorku 



BAKBR « GODWIN, FuNTUB, 
Nbw Yobk. 



CONTENTS. 



, An Introduction, containing a brief historical sketch of the 
two Banking Systems of the State of New York, prior to 
that introduced by the General Banking Law of 1838. 
The first system was in force from 1791 to 1829, the second 
from 1829 to 1838 : pp. vii. to Ixiv. 

IL A table of the Statutes embraced in this Volume, arranged 
in the order of the years in which they were enacted : pp. 
Ixv. to Ixxv. 

Ill* A table of the Lending, Cases decided by the Courts of the 
State of New York, from 1838 to October, 1864, relating 
to the General Bank Act of 1838, and the powers, <S5c., of 
corporations formed under it : pp. Ixxvi, to Ixxx. 

IV, General Statutes enacted before 1838, viz, : the S^atj^te of 
1827 {Revised Statutes), entitled " Of Mqiiieyed, Corpora- 
tions" (pp, 1-28) ; containing regulations to prevent their 
insolvency, an^ to secure the rights of their creditors and 
stockholders (pp. 1-17) ; and concerning the election of 
their Directors (pp, 17-23) ; also, definitions, of certain 
terms used in the Ee vised Statutes (pp. 23, 24),; also, the 
Statute jof 1827 {Bevised. Statutes), entitled "Olth.e,ge;neral 
powers, privileges, &c., of corporations" (pp. 24-28) ; also, 
the Statute of 1829, callpd the "S,afety Fund, Act" (pp. 



ii CONTENTS. 

29-39) ; the Statute of 1830 {Revised Statutes), called the 
" Eestraining Act" (pp. 39-50) ; the Statutes of 1830 {Re- 
vised Statutes), entitled " Of proceedings against corporations 
in equity" (pp. 50-64) ; and " Of the voluntary dissolution 
of corporations" (pp, 6fr7^ ; also, the Act of 1830, con- 
cerning bankpetes ^jp. 75,^0')^^he Act of 1835, imposing 
certain restrictions W all wdweylfc? corporations (pp. 77-79); 
and the Act containing special provisions relating to certain 
corporations (pp. 80-80/). 



V. The General Banking Law of 1838, as originally passed, 
with notes and references to subsequent amendments, and 
to the decisions of the Courts (pp. 81-106). 

VI. The General Banking Law as altered by subsequent legis- 
lation (pp. 211-223). 

VII. All the Special Statutes passed since 1838, amendatory of 
the General Banking Law (pp. 107-208^^) ; also, the statutes 
relating to Foreign Bank Notes (pp. 107, 193, 206) ; to suits 
by or against banking associations (p. 125) ; to Receivers of 
banking associations (pp. 127, 134, 135, 144, 145, 208p) ; 
also, the statute to enforce the responsibility of Stockholders 
in certain banking corporations, &c. (pp. 155, 205, 208v, 
208ee); to provide for the final closing of incorporated 
banks, &!c. (p. 208e) ; in relation to the taxation of banks, 
&c. (pp. 208A, 208cc) ; to provide for the reduction of the 
capital stock of banks (p. 208<) ; to authorize banks to take 
and hold United States Stock (p. 208a;) ; to provide for the 
consolidation of banks (p. 208a:) ; relating to unclaimed 
dividends and deposits (p. 173) ; to the distribution of funds 
held by the Comptroller (p. 175); to the establishment of 
the Bank Department (pp. 178, 208a, 208c, 208p) ; and to 



CONTENTS. iii 

the punishment of fraudulent and unauthorized issues and 
transfers of stock or bonds of corporations (p. 207). 

VIII. The Appendix contains the Restraining Acts of 1782, 
1804, 1813, and 1818 (pp. 233-239); also, the statutes 
relating to the proceedings against corporations in Courts 
of Law (pp. 240-245) ; to assessment of taxes upon corpo- 
rations (pp. 224-229) ; to the collection of debts against 
corporations (pp. 232, 233) ; to abatement of suits by or 
against corporations (p. 230); to proceedings against 
foreign corporations (pp. 240-253); to promissory notes 
and bills of exchange (pp. 253-260) ; to interest of money 
(pp. 260, 261); to usury (pp. 262-265); and to dividends 
on stocks held by the State, or by literary or charitable 
institutions (p. 231) ; also, the provisions of the Constitution 
of 1846 relating to corporations (pp. 264, 265). 

The Appendix contains also, the names of all the Banks 
chartered by the State of New York, from 1791 to 1829 
(pp. 284, 285) ; and from 1829 to 1838, under the Safety- 
Fund System (pp. 286-289) ; and from 1838 to 1855, under 
the General Banking Law (pp. 289-295) ; also, the names 
of the Special Charter Banks whose charters had not 
expired in January, 1855 (pp. 295, 296). 

The Appendix contains also, an account of the Clkaking 
House established in the City of New York, in 1853 
(pp. 266-283) ; also, a DieEST of the Leadinq Decisions 
of the Courts of the State of New York, relating to the 
General Banking Law, and to the powers of banking 
corporations organized under it (pp. 297-359). 



OTRODFCTION. 



Tb:e origin of Banking dates far back. At first 
it was entirely a kard-money operation. Tke va- 
riety of coins used by different nations, gave rise to 
tke class of money-ckangqrs, — ^tke bankers or bro- 
kers of tkat day, — tkrougk wkom tke unavailable 
coin of otker countries could be ckanged into tkat 
wkick was current in tke land. In Greece, wkere 
violence often prevailed and property was insecure, 
treasure could be safely placed only in some spot 
keld sacred by all. Hence Delpki became a place 
of deposit, and its celebrated temple was tke seat 
of a bank as well as of an oracle. In Rome, also, 
tkere were bankers (argentarii), witk wkom tke 
revenues, not only of individuals but of tke State, 
were deposited. 

To tke Jew bankers of commercial Lombardy we 
are indebted for tke term. Tke progenitors of our 
spacious and splendid banking-kouses were very 
simple .tkings : a benck (Italian, banco) was set up 
in tke market place, for tke exckange of money. 



vi INTRODUCTION. 

The first public bank dates from A. D. 1153, and 
Venice claims the honor, (a) There is something of 
romance and glory in its origin, for it was founded 
to aid that heroic republic in the wars of the cru- 
sades. This was a bank of deposit only. 

With advancing commerce, Florence subsequently 
became the centre of the monetary transactions of 
Em-ope, and the business of banking was necessa- 
rily enlarged. Two hundred and fifty years after 
the establishment of the Bank of Venice, the 
Banks of Barcelona and of Grenoa were founded. 
Two centuries more went by, before the growing 
commerce of Northern Europe obtained the Banks 
of Amsterdam, and Hamburgh, and Rotterdam, 
and Stockholm. The Bank of England dates from 
1694. Like its Venetian predecessor, it sprang 
from the exigencies of war. Yet its origin was 
humble. When one thinks of that vast govern- 
ment engine as it now exists, its huge banking- 
house, its army of ofiScers and clerks, its tons of 
gold and silver, and its operations that reach and 
affect every quarter of the globe, — ^he can hardly 
read without a smile the title of its incorporating 
act : " An Act for the granting to their Majesties 
several rates and duties upon tonnage of ships and 
vessels, and upon beer, ale, and other liquors, for 



(a) Levi on Mercantile Law, pp. 199, 200 ; MoCullooh's Diet. (Amer. ed), 
article " Banks (Foreign)." 



INTRODUCTION. vii 

securing certain recompenses and advantages in the 
said act mentioned to sucli persons as shall volun- 
tarily advance tlie sum of £1,500,000 towards tlie 
carrying on the war against France." (b) 

The Bank of Scotland is one year younger than 
her sister of England. 

The Bank of North America, under the old Con- 
federation, was established in 1781; the Bank of 
Ireland in 1783 ; the first Bank of the United 
States, in 1791 ; and the Bank of France in 1803.(c) 

"With this hasty and partial glance at the chro- 
nology of banking, we pass to the special history 
of New York legislation on the subject. 

The details of its changes and progress are in- 
structive. The system which now works so easily and 
safely, was reached only through a long and some- 
times painfal experience. We should know some- 
thing of the corruption and the gross abuses which 
prevailed under imperfect and ill-regulated plans of 
operation, — enkindling at times great popular excite- 
ment and indignation, — sometimes checking and 
Sometimes modifying the action of legislatures, — ^in 
order properly to understand and to appreciate the 
law which we have. 

It will be seen that from 1791 to 1838 two dis- 
tinct and widely different systems were tried and 



(6) S Stat, at Large, 6 W. & M. (1694), c. 20, p. 568. 
(c)Lcvi on Mercantile Law, pp. 199, 200; McCulloch's Diet., article 
"Banks, Foreign;" Reea' Cyclo., article "Bank." 



viii INTRODUCTION. 

abandoned, before the adoption of the one now in 
use. We shall show what were the leading princi- 
ples in each of these repudiated methods ; pointing 
out some of their inherept.,^ects, and some of 
the evils which their practttjal wor^g unfolded. 
Nonflmer- The Bank of North ^imerica, alrea^y^entioned, 
was established at the close of 1 781, with q; recom- 
mendation, by the Continental Congress, that the 
several States should grant charters to the institu- 
tion. This was done by Pennsylvania on the first 
of AprU, 1V82, and by New York ten days after- 
ward, (d) 

The grant of power to the Bank of North Amer- 
ica by the ordinance of Congress, and by the act of 
the legislature of Pennsylvania, to hold and convey 
real and personal estate, was in nearly the same 
words as the grant to the Bank of England in the 
charter of 1694. (i) But both the ordinance of 
Congress and the Pennsylvania act of 1*782 omitted 
the prohibitions and restrictions carefully inserted 
in the English charter of the Bank of England 
of 1694, and found also in the charters of the Bank 

{d) See charter, pp. 233, 234, post. 

(e) The act 5 W. & M. chap. 20, July 21, 1694, incorporating the Bank of 
England, eontains 49 sections ; but sections 19 to S3, both inclusive, relate 
to the bank, (3 Stat, at Large, 558.) Grant of Power. — " The Governor 
and Company of the Bank ot England," to have perpetual succession and 
a common seal, " and that they and their successors, by the name aforesaid, 
shall be able and capable in law to have, purchase, receive, possess, and 
*njoy, and retain to them and their successors, lands, rents, tenements, and 
hereditaments, of what kind, nature, or quality whatsoever ; and also to 
sell, grant, demise, alien, and dispose of the same, and by the same name 
to sue and implead," etc. (Section 20). 



INTRODUCTION. ix 

of Scotland, the Bank of France, and the Bank of 
Ireland. (/) 

In 1V85, numerous petitions were sent to the 

{/) By section 27 of the charter of the Bank of England, it was 
enacted as follows : — 

Prohibition against Teading. — "And to the intent that their Majes- 
ties' subjects may not he oppressed by the said corporation, by their mono- 
polizing or engrossing any sort of goods, wares, or merchandises — Be it 
further declared and enacted by the authority aforesaid, that the said corpo- 
ration to be made and created by this act, shall not at any time during the 
continuance thereof deal or trade, or permit or suffer any person or persons 
■whatsoever, either in trust or for the benefit of the same, to deal or trade 
with any of the stock, moneys, or effects of or any ways belouging to 
the said corporation, in the buying or selling of any goods, wares, or merchan- 
dise whatsoever," except bullion. The penalty for a violation of the forego- 
ing prohibition, was declared to be a forfeiture of treble the amount of the 
goods or merchandise so purchased or traded for, to be recovered by 
action of debt, wherein no privilege, injunction, restraint, protection, or 
wager of law should be allowed. 

Loans to the King PaoHiBrrED. — By section 30 the Bank was prohibited 
from loaning or advancing any sum of money to their Majesties, their 
heirs or successors, without the authority of Parliament ; and from pur- 
chasing lands or revenues belonging to the Crown ; and the penalty for a 
violation of this prohibition was, a forfeiture of treble the Amount loaned, 
one-fifth to go to the informer. 

Trading in Bullion Allowed. — By the 28th section it was provided, 
that the Bank might buy and sell gold and silver bullion, and bills of 
exchange ; and might sell goods really and bona fide left or deposited for 
money lent thereon, if not redeemed at the time agreed on, <feo. (Statutes at / 
Large, quarto ed., vol. iiL, p. 558 ; 1 McCulIoeh's Diet., Amer. ed., 1840, p. 16. ) 

The Bank of Scotland. — This institution was established in 1696, by 
an act of the Scotch Parliament. This act declares " that it shall not be 
lawful " for the managers, <fcc., of this bank, " on any pretense whatever, to 
follam any other trade with the joint stock to be employed in said Bank, 
or any part thereof, or profits arising therefrom," than that of banking ; 
and the same act provides that if the directors should be found guilty of 
lending, on account of said Bank, any money to the KiSg, they shall be 
liable, for every such fault, to triple the value of the money so lent. (1 
McCuUoch's Diet., Amer. ed., 1840, p. IIY ; Layson's History of Banking, 
Amer. ed., p. 228; Levi's Mercantile Law, p. 157.) 

The Bank of Ieeland. — This institution was established in 1788, by an 
act of Parliament. This act prohibited loans to the King, and provides, 
"that to the intent that the subjects of the King may not he oppressed by 
the said corporation, by their monopoly of any goods, wares, or mer- 
chandise, it shall only be lawful for the corporation to deal in bills of 



X IKTBODirCTIOlf. 

legislature of Pennsylvania, praying that body to 
take away tlie charter whicli had been granted to 
the Baipik of North America. 

These petitions represented that the bank had 
produced mischievous consequences to the fair tra- 
der, and had destroyed that equality which ought 
to exist in a commercial community. They were 
referred to a committee, who reported that the 
prayer of the petitioners ought to be granted, and 
accompanied their report with an act to repeal the 
act of April 1, 1782, chartering the bank. The 
immediate adjournment of the legislature prevented 
action on the report. During the vacation, ia the 
summer of 1Y85, the agitation and excitement 
on the subject of the repeal increased ; and in 
September, 1785, the legislature again met, when 
eminent counsel were heard at the bar of the 
House for and against the bank. The excitement 
ia the State was so intense and widely extended, 
that the legislature could not resist its influence; 
and in September, 1785, the Pennsylvania char- 
ter of this bank was repealed by a large major- 
ity, (^g) The Bank of North America, after the 

exchange, w in buying or selling bullion, gold, or silver, or in selling any 
goods, (Sic., really and bona fide left or deposited with the said corporation, 
for money lent or advanced thereon, and not redeemed at the time agreed 
on." (LawBon's Hist, of Banking, pp. 20Y, 208 ; 1 MoCuUooh's Diet, pp. 
121, 122.) 

The Bank of France is " forbidden to traffiok in any thing except money." 
(Rees' Cyolo., article "Bank.") 

{g) In Reea' Cydo., article " Bank,'' will be found a history of the Bank 
of North America, chartered by the State of Pennsylvania, and of the 
repeal of the charter of 1782. 



rNTEODTJCTIOK xi 

repeal of the Pennsylvania charter, still carried on 
its business, claiming the right to do so under the 
ordinance of the Continental Congress. It, how- 
ever, in March, ITSY, obtained a new charter from 
the State of Pennsylvania; and its existence has 
been continued by successive acts of incorporation, 
without interruption to the present day. 

But the legislature of Pennsylvania, in the second 
charter, entitled, " An Act to Eevive the Incorpora- 
tion of the Bank of North America," was careful to 
insert the restrictions and prohibitions contained in 
the charter of the Bank of England, and nearly in 
the same words (Ii). Established at Philadelphia, 
the Bank of North America became, in some par- 

(A) This ue'w charter granted by Pennsylvania, after reciting the fact of 
the passage of the Act of April 1, 1782, and of its repeal in September, 
1785, also recites as follows: — " Whereas, a bank under proper regulations 
may be rendered useful to the commerce and agriculture of the State ; and 
it is proper that the subscribers and stockholders of the Bank of North 
America should have a charter of incorporation, under such Umitationa an4 
restrictions as not to become an object of jealousy and apprehension to the 
good people of this State." Then follow the limitations and restrictions : 
(1.) It limits the corporate life to 14 years. (2.) Grants power to hold 
property to the amount of $2,000,000, and no more. (3.) Limits the quan- 
tity of land to land actually occupied by the bank for the purposes of its 
business, &o. (4.) Grants power to trade in bullion and bills of exchange, 
and to sell goods lona fide and really pledged to it as security for loans. 
(6.) Prohibits trading — "And to the intent that the citizens of this State 
may not be oppressed by the said Corporation by their monopolizing or en- 
grossing any sort of goods^ wares, or merchandise : Be it fv/rther enacted, by 
the authority aforesaid, that the said Corporation shall not, at any time, 
deal or trade, or permit or suffer, any person or persons whatsoever, either 
in trust or for the benefit of the same, to deal or trade with any of the 
stock, moneys, or effects of, or in any way belonging to said Corporation, 
in the buying or selling of any goods, wares, or merchandise whatsoever, except 
bullion, as above stated (Laws of Penn. ; ed. of Carey & Bioren, vol. iii. p. 
188). 



1T9L 



Xll INTRODUCTION. 

ticulars, tlie model of tlie two subsequent nationa 
banks under the present Constitution of the Unitec 
States (j). 
thfu.'s"' February 25, 1791, the first Bank of ihe TTmtec 
States was incorporated by Congress, with a capital 
of $10,000,000. Three-fourths of this capital were 
to be payable in the pubUo debt of the United States 
and the act of incorporation recites as follows 
" Whereas it is conceived that the establishment o: 
a bank for the United States upon a foundatioi 
sufficiently extensive to answer the purposes intend 
ed thereby, and at the same time upon principles 
which offered adequate security for an upright anc 
prudent administration thereof, will be very con 
ducive to the successful conducting of the nationa 
finances ; will tend to give facility to the obtaining 
of loans for the use of the government in suddei 
emergencies ; and will be productive of considerabh 
advantages to trade and industry in general " (Ic). 

Instead of being a merely commercial establish 
ment, this bank was essentially of a financial anc 
political character, and it was mainly on this grounc 
that its constitutionality was defended (]c). Th( 

{j) 3 Hildreth'a History, p. 406. 

(k) Stat, at Large, p. 191. Enoyclo. Amerioana, Article " Bank." 
In the Ne-w York act of April 11, 1Y82, incorporating the Bank of Nortl 
America, the legislature of this State inserted this proviso : "Provided alwayt 
and it is further enacted, That nothing in this act contained shall be cor 
strued to imply any right or po-wer in the United States in Congres 
assembled, to create bodies politic, or grant letters of incorporation, in an; 
case whatever." (1 Greenleaf, p. 60.) 



INTRODUCTION. Xlll 

Bmik of Mngland originated in a loan to tlie Britisli 
Government of £1,500,000 towards tlie carrying on 
the war wMcIl it was then waging with France. 
And the first Bank of the United States had a 
similar origin ; for its charter provided, that the 
sums subscribed by individuals and corporations 
should be payable " one fourth ia gold and silver, 
and three fourths in the public debt " of the United 
States. Notwithstanding the design and scope of 
the first Banh of the United States, as indicated in 
the preamble to the act of incorporation, and in the 
fact that three fourth parts of its entire capital were 
payable in the public debt, — yet, by its charter, it 
was expressly prohibited from making any loan to 
the Government of the United States exceeding 
$100,000, or to any State exceeding $50,000, or to 
any foreign Prince or State, unless previously au- 
thorized by a law of the United States ; and it was 
also prohibited from '■'■ pv/rchasing any public debt 
whatsoever " — and from " directly or indirectly deal- 
ing or trading in any thing except bills of exchange, 
gold and silver bullion, and goods really and truly 
pledged for money lent, and not redeemed in due 
time, &c." (J). 

(I) As the charter of 1791, of the Bamk of the tTmrED States, became 
the model upon which the early bank charters, subsequently granted in 
this State, were ibrmed, it may be instructive to specify what were the 
leading features of the Bankino System introduced by the Federal Govern- 
ment under the present Constitution. 

Gkant of Power. — By section 3, the corporation to " have, purchase, 
receive, posses^ employ, and rejtain to them and their successors, lands. 



XIV INTRODUCTION. 

ifS?Yo?i March 21, 1T91, one montli after the Bank of the 

ITM. 

United States was charted by Congress, the legisla- 
ture of this State passed an act entitled, " An Act 
to incorporate the stockholders of the Bank of New 
York." This was the first bank charter granted in 
this State, after the act incorporating the Bamlc of 
North America. The charter of the Baiik of New 
York was substantially the model upon which aU 
the bank charters granted in this State were framed, 
prior to the year 1825, when the form of these acts 
was changed, and new and more stringent prohibi- 
tions amd rest/rictions were enacted by the legisla- 
ture, as will be more fully shown, 
i^^aing These acts of incorporation, after reciting, that 

IbatareB of , • t >^ 

te8*^riOTto Whereas certam persons associated as a Company^ 

\m^ . 

rents, tenements, hereditaments, goods, chattels and effects of what kind, 
nature, or quality soever, to an amount not exceeding in the whole 
$16,000,000, including the amount of the capital stock aforesaid," Ac 

Limitation as to Real Estate. — (1.) To a banting house, <fec. (2.) To 
lauds mortgaged by way of security for debts, &c. (3.) To lands purchased 
upon judgments for such debts. 

Pbohibihon against Teadino. — Reg. 10. "The said corporation may sell 
any part of the public debt whereof its stock shall be composed, but shaU 
not be at liberty to purchase any public debt whatever ; nor shall directly 
or indirectly deal or trade in any thing except bills of exchange, gold Ot 
silver bullion, or in the sale of goods really and truly pledged for money 
lent and not redeemed in due time, or in goods which shall be the produce 
of its lands." * 

Loans to Goveenment. — Regulation 8 forbids a loan to the government 
of the United States, Ac, <!iic, exceeding $100,000, imless previously au- 
thorized "by a law of the United States." 

Penalties fob Violation of Regulations. — For dealing and trading in 
goods, &c. — a forfeiture of treble the value of goods, <Stc. For loaning 
money to the Government exceeding $100,000 — a forfeiture of treble of the 
amount of the unlawful loan. (1 Stat, at Large, pp. 191, 196.) The second 
Banh of the United States, chartered by Congress April 10, 1816, contained 
the same prohibitions and restrictions, only made more stringent. 



INTEODUCTIOIT. XT 

under the style of the President, Directors, and Com- 
pany of the Bank of Isfew York [or Bank of Al- 
bany], by their petition presented to the legislature, 
have prayed for the privilege of being incorporated, 
the better to enable them to carry on the business 
of their institution,"- — ^proceed to enact that the 
petitioners, &c., be a body corporate and politic by 
a certain name / that by such name, they and their 
successors should have succession for a fixed period 
of years, capable of suing, being sued, &c.; that 
by such name, they and their successors should be 
legally capable of purchasing and conveying any 
estate, real or personal, for the use of the corpora- 
tion ; that the real estate be limited to the quantity 
needed for the immediate accommodation of the 
bank, together with such as should be mortgaged to 
it by way of security, or conveyed to it in satisfac- 
tion of debts previously contracted; that all bills 
or notes issued by order of the corporation, and 
promising payment of money to any person, or to 
bearer, should be as blading upon said corporation, 
and as really assignable and negotiable, as if they 
had been issued by a private person; that the 
total amount of debts, over and above the moneys 
actually deposited in the vaults of the bank, should 
not exceed three tvmes the capital actually paid in. 
The capital stock was fixed at a definite sum ; the 
location of the bank was designated, and all the 
operations of discount and deposit were to be carried 



XTl INTEODUOTIOK 

on in tliat place, <md not elsewhere. The number 
of directors was fixed, and the mode of election pre- 
scribed. These charters contained the following 
prohibition against trading. "The said corporation 
shall not directly or indirectly deal or trade in buy- 
ing or selling any goods, wares, or merchandise, or 
commodities whatsoever, — or in buying or selling 
any stock created under any act of the Congress of 
the United States, or of any particular State unless 
in selling the same when truly pledged to it by 
way of security for debts due to the said cor- 
poration." (m) 
BaniiBg None of the bank charters, prior to 1825, con- 

powers not , /» t i ■ rm 

^^«^**^_ tamed any 8pec%fiGaUon of banking powers. The 
legislature, from 1Y91 to 1825, seemed to rely 
solely upon prohibitory and restrictive clauses 
inserted in each charter,' — ^upon a declaration, that 
deaUng or i/rading in State stocks, goods, wares, and 
merchandise, was not banking — and that thejjoweT" 
thus to trade or deal, was not necessary to carry on 
that business, (o) Only seven banks had been incor- 



(m) That this prohibition, in suhstanoe and effect, and generally in tha 
same words, was inserted in all bank charters prior to 1826, see the 
following : 

2 Webster's Ed. Laws, p. 364, § 10, lYOl, Charter Banlc of New York. 
2 " " -p. 362, § 14, 1792, " Bank of Albany. 

8ess. Laws 1807, p. 46, § 10, Charter Mohawk Bank. 
" " 1811, p. 144, § 1, " Mechanics' and Farmers Bank. 
" 1813, p. 67, § 1, " Ontario Bank. 

(o) See Talmage v. Pell (3 Selden 828, S46). 



INTRODUCTION. XVll 

porated by tMs State prior to 1804. {p) Until 
that year, tlie riglit of "banking was a common-law 
right, belonging to individuals, and to be exercised 
at their pleasure. The legislature had authority to 
regulate or restrain this right. This was done by ' 
the Resi/rainmg Acts hereinafter mentioned. After 
the first restraining law, banking became a franchise 
derived from a grant of the legislature, and sub- ' 
sisting in those only who could produce tJie 
grant, (^q) 

April 11, 1804, an act " to Resi/rain TTnmcor- _ . . 
porated Ba/riking Associations^'' was passed. (7")&f'''°' 
The object of this statute was, to guaranty "to 
banks a monopoly of the rights and privileges 
granted to them, which had been encroached 
upon or infringed by private associations." {s) 
This act was re-enacted in the Eevised Laws of 
1813. if) "Previous to the restraining acts," says 
Chief Justice Sa/oage^ " there was no power 



(p) Bank of North America . . .in 1'782. 

Bank of New York . . . .in 1V91. 

Bank of Albany .... in 1792. 

Bank of Columbia . . . .in 1793. 

Manhattan Company . . .in 1799. 

Farmers' Bank . . . .in 1801. 

New York State Bank ... in 1803. 

(2 R. L. 1813, p. 669.) 
{q) 16 Johns. R., 375, 879; 2 Johns. Ch. R., 371. 
(r) Laws 1804, p. 615. See p. 234, post. 
(s) N. YFiremeris Ins. Go. v. My (2 Cowen, 711 . 
(<) 2 R. L, p. 234. See page 236, post. 



XVlU INTBODirCTIOK. 

possessed by a baiik not allo-wed to individuals 
and private associations. They could in common, 
issue notes, discount notes, and receive deposits; 
tlie only difference was, that the former were not 
liable beyond their corporate property, while the 
latter were accountable in their persons and to the 
fuU extent of their private estate." (w) 
«M2o»a. Upon a memorial of the Chamber of Commerce 

^**^ of the City of New York, the legislature, in April, 
1804, passed an act eoGplanatory of the restraining 
act of that year, and declared it should not be con- 
strued to affect the corporation created by an act 
entitled "An Act for supplying the City of New 
York with pure and wholesome water." (v) 

in^Artof' ^"^ 1813, the legislature passed an act "to pre- 
vent the passing and receiving of bank notes less 
than the nominal value of one dollar — and to re- 
st/rain wnincorporated la/nkmg associations.^'' (w) In 
1815, the restriction in this act, as to issuing bills 
less than one dollar, was suspended until the end 
of the next session of the legislature, (a?) 

November 12, 1816, the legislature passed an act 
entitled, "An Act concerning banks." (y) By this, 
it was enacted that no banking company should 



(«) 2 Cowen, TIO. («) See page 236, port, 

(w) See page 236, port. (a) Laws of 1815, p. 86. 

(y) See page 287, post. 



1818. 



INTRODUCTION. XIX 

issue any Hlls or notes other than for the payment 
of money ; and that the sums expressed in any bills 
which any bank should issue, which were, according 
to the terms thereof, receivable only in payment of 
debts due, to the bank, should be recoverable by the 
bearer of such bills, in like manner as if the same 
contained an express promise for the payment of 
money, (s) 

April 21, 1818, the legislature passed '•'■An Act 
relative to hanks^ amdfor other purposes^'' (a) 

Savage, Oh. J., in FvremarHs Insurance Company EestmiH- 
vs. El/y, (b) says, that the legislature found it^^^^ 
necessary to pass this act, in order to ^^ place indi- 
viduals upon the same footing with private associ- 
ations, with the same view to monopoly by the 
incorporated banking companies. The first of these 
acts" [the act of 1804, re-enacted in 1813] "pro- 
hibits the formation of any bank or fund for the 
purpose of issuing notes, receiving deposits, making 
discounts, or transacting any other business which 
incorporated banks may or do transact by virtue of 
their respective acts of incorporation. The second " 
[the act of 1818] "prohibits any person, association 
of persons, or body corporate, from keeping any 
office of deposit, for the purpose of discounting 
promissory notes, or carrying on any kind of bank- 



(s) Laws of 1816, p. 12. See p. 237, post, 
(a) Laws of 1818, p. 242. Seep. 237, post. 
(6) 2 Cowen, 711. 



XX 



INTRODUCTION. 



ing business or operations wMcli incorporated banks 
are authorized by law to carry on, or to issue any 
bills or promissory notes as private bankers, unless 
thereto specially authorized by law." 

The legislature in April, 1824, passed an act 
"to prevent the passing and receiving of bank notes 
payable otherwise than in Icmful money of the 
United States:''' (c) 

The foregoing statement, and the bank charters 
and restraining acts to which reference has been 
made, show the manner in which the banking sys- 
tem was introduced into this State, and by whom, 
and upon what principles, the business of banking 
was authorized by law to be conducted prior to the 
year 1825. We have seen that the main features of 
aU these bank charters were derived from the acts 
incorporating the Bank of England in 1694, and the 
Bank of the United States in 1791 ; and that as 
neither of these charters, English or American, de- 
fined or specified the bcmking powers (d) intended 
thereby to be granted, it became necessary by re- 
strictive and prohibitory clauses, to limit the powers 
of the corporations so created. Thus, we find in all 
these public enactments, from 1694 to 1825, unequi- 
vocal declarations by the English Parliament, by 
Congress, and by successive Legislatures of this State, 
that trading in any thing, except bullion, foreign 

(c) Laws 1824, p. 803. See p. 239, post. See §§ 10. 11, p. 48, post. 

(d) See § 4, p. 26, post ; and § 1, p. 39, post ; and 2 Cowen K. 711. 



INTRODUCTIOlf. xxi 

coins and bills of exchange, — ^is not hcmUng ; and 
that tlie power to traffic in stocks or merchandise, 
was not "either necessary or expedient to accom- 
plish the purpose for which banks are instituted." {e) 
The model charter of the Bank of New York was 
granted, as we have already stated, in 1791. The 
company thus incorporated had been an organized 
and active business association for more than seven 
years previous, but had been unable to get a char- 
ter. The people had not yet forgotten the evils of 
the Continental paper money, and the legislature 
was jealous of every thing in that shape. The Bank 
of Albany was chartered in 1T92, and that of Co- 
lumbia, at Hudson, in 1793. Until the close of the 
century, when the whole banking capital of New 
York was but fourteen hundred thousand dollars 
(ee)^ no party considerations seem to have influenced 
the creation or the action of banks. The demands 
of commerce and the public convenience were alone 
considered. But party spirit soon became warm 
and high. The Bank of New York was in Federal 
hands. The Eepublicans very naturally wished for 
a bank which they could control. As the legisla- 
ture had a majority of their opponents, and as even 
the Republican members were extremely jealous of 
moneyed institutions, the probability of obtaining a 
charter was very small. Management might accom- 
plish what could not be done otherwise. The plan, 

(«) See Talmage v. Pell{Z Selden, 328, 346), Gardiner, J. 
(«e) See List of Banks chartered from Vl^l to 1829, pp. 284, 285, ^os<. 
G 



Manhat- 



obtained. 



xxii INTRODUCnOlT. 

devised by "a mind capacious of such tlings," 
proved successful. The city had just been ravaged 
B*"^^"*' ^y ^^^ yellow fever, and its need of water in purity 
SSer*°wa8 and abundaucc had been more felt than ever. At 
this opportune moment the petitioners asked the 
government to incorporate them for the benevolent 
purpose of supplying this great want. It was a 
noble object, and met with favor. As they could 
not foresee how much these works would cost, they 
proposed the liberal sum of $2,000,000 capital. And 
furthermore, as it was possible that these water- 
works might not absorb the entire amount, they 
asked for a provision authorizing the proposed cor- 
poration to employ its surpl/us capital " in the pur- 
chase of public or other stock, or in any other 
moneyed trmisactions or operations not inconsistent 
with the Constitution and laws of this State, or of 
the United States." And stUl further, as the object 
was to supply a want that would never end, it was 
reasonable that the grant should be perpetual. 
Such was the charter which Aaron Burr carried 
through the unsuspecting legislature of 1799, and 
which, under the modest name of the Manhattan 
Company^ soon turned out to be a genuine Banking 
Institution, endowed with great power and endless 
life (/). 



(/) It seems to be an admitted fact, that at the time the act was passed, 
incorporating the Manhattan Company, a majority of the members of the 
legislature, as well as the Council of Revision, did not suspect that it con- 
tained banking powers. (Ham. Hist, i., 129, 130, ii25-828 ; 1 Burr, 413, 415 ; 
People V. Manhattan Comp. (9 Wend. 864) ; Laws, Web. ed. p. 870, § 8.) 



INTRODUCTION. XXlu 

The incorporation of the New York State Bank 
at Albany in 1803, of tke Merchants' Bank in 
New York, 1805, and of the Bank of America in 
1812, was much mixed up with and influenced by 
the partizan strifes of that stormy period. In each 
of these cases there were numerous charges of Irih- 
ery^ and some of them were but too well substan- 
tiated. 

Mr. Hcmwnond^ in his Political History of New 
York, says — " The odium attached to aU those im- 
plicated in the corrupt means used to promote the 
incorporation of the Bank of America.^ was so great 
and so lasting, that no attempts were made for a 
long time afterwards ; and the iniquitous proceed- 
ings of former legislatures in relation to granting 
charters to moneyed institutions, had been so dis- 
graceful to the State and were so fresh irt the recol- 
lection of the members of the Convention of 1821, 
as beyond aE question induced them, with a view 
to the prevention of these practices, to insert the 
clause in the Constitution of 1821 which rendered 
necessary the assent of two-thirds of both houses 
of the legislature, in order to incorporate any 
moneyed institution." {g) 

Mr. Hammond gives a history of the means 
adopted to procure the charter of the Manhattan 



{g) Hammond's History, vol. i. p. 337. 



xxiv INTRODUCTIOir. 

Compcmy^ in ITGO— of the Merchmts' Bank, in 
lg05 — .and of the Bcmk of America, in 1812. Qi) 

At the close of the first quarter of the present 
century, the State of New York had forty-two 
banking institutions, with the right to employ a 
capital of $28,900,000. The applications at this 
time for new bank charters, were very numerous, 
but not very successful. Cases of alleged corruption 
and mismanftgement then on trial in the Courts of 
law, excited great interest, and disinclined the 
legislature towards the chartering of banks. A com- 
mittee was appointed to inquire into alleged viola- 
tions of charters by certain Insurance Companies in 
the city of New York. The chairman, Mr. Spencer, 
reported," that the companies referred to, were in 
the habit of loaning their own bonds on promissory 
notes or personal securities; that they claimed this 
ligtit under implied powers, supposed to be con- 
ferred by vague and general expressions in their 
charters ; that large amounts of these securities had 
been issued, and were afloat in the community ; that 
many of these companies had the right by their 
charters to loan money; but that the committee 
questioned their right to issue bonds or notes for 
the purpose of loaning them / that tJiis was strictly 
a banking privilege, and within the laws to restrain 
unincorporated banking associations. He reported 

(A) Hammond's Hist. vol. i., 219, 220, 809-316, 325, 327, 832-338. See 
also Note u, by General Root, p. 584. 



INTRODUCTION. XXV 

also that certain other Insurance Companies, incor- 
porated witli the obvious intention that they should 
he located in the interior of the State, had been, 
after lying dormant for years, resuscitated and 
brought into operation in the city of New York; 
that although a location Vfas not expressly directed 
in the charters of these companies, yet from their 
titles, and known residence of the persons incorpo- 
rated, and of the citizens appointed directors and 
commissioners, there could be no reasonable doubt 
of the jntention of the legislature; and that the 
Committee did not believe, that such palpable vio- 
lations of that intention, and of the spirit of their 
charters, would be sanctioned or sustained by the 
courts of thel' State. (JiK) 

Mr. Spencer also reported a bill to pre'^ent ^^^j"*^* 
fraudulent bankruptcies by incorporated companies-^^SSJ^ 
This was the most important bill acted upon by the|^e|j^' 
legislature of 1825 ; and on the 21st day of April 
of that year, it was enacted, and became a law of 
this State, under the title of, '■'■An Act to prevent 
fraudulent hankruptcies ly imiorporated companies^ 
— to facilitate proceedings against them^-^and for 
otlier pv/rposesr (^') 

(AA) The report of Mr. Spencee will be found at length in the N. Y. 
Evening Post of May 11, 1826. In all acts passed in 1825, incorporating 
Insurance Companies, a prohibition was inserted against such Companies 
keeping an office for the transaction of business in any place except the 
city, town, or village designated in their charters. (Laws 1826, p. 46, 
§ 16 ; p. 62, § 16 ; p. 163, § 1.) See Note 87, p. 92, post. 

{j) Laws of 1828, p. 448. 



XXVI INTRODUOTIOK. 

This celebrated act contained many stringent reg- 
ulations, calculated to check abuses in all moneyed 
corporations, to prevent their insolvency, and to 
expedite proceedings against them. All transfers or 
assignments by incorporated companies, in contem- 
plation of insolvency, were declared by this act 
uUerl/y void ; and if any incorporated bank should 
become insolvent, or violate its charter, or any other 
law binding upon it, the chancellor was authorized, 
upon the petition of any creditor, or upon the appli- 
cation of the attorney-general, by process of injunc- 
tion, to restrain the exercise of its powers, and to 
appoiat a Receiver of its effects, to be distributed 
" among the fair and honest creditors thereof." 
"This," says Chancellor Kent, "was a statute of 
hmikruptcy in relation to incorporated banks ; and 
it was an unusual provision, for the English bank- 
rupt laws, or the general insolvent laws of the 
several States, never extended to corporations.'''' (F) 

By the Revised Statutes of this State, the provis- 
ions of the act of 1825 have been re-enacted and 
greatly enlarged. (J) 

Only two of the numerous applications for bank 
charters' were granted by the legislature of 1825. 
The " Commercial Bank of Albany " and the 



(k) 2 Kent's Oom. 815. 

(Z) See Chap. 18, Part I., Titles 2, 3, 4, of 1 Revised Statutes; also the 
Act concerning the Revised Statutes, passed Dec. 10, 1828, in Sess. Laws of 
1829, p. 24, § 17. See pages 1-11, post. 



INTRODUCTION. XXVll 

"Dutchess County Bank" were chartered in that 
year. 

The legislature of 1825, in grantiuff charters to rireticgis- 
the two banks last named, for the first time defined bank™/' 

-, ,, , , powers, 

and hmited the powers of corporations created for ^8^- 
banking purposes. In each of these charters, is in- 
serted a precise enumeration of the hanlcmg powers 
intended thereby to be conferred, accompanied with 
a declaration, that said banking company, so created, 
" shall have and possess no other powers whatever, 
except such as are expressly granted by this act." 

The grant of power to the " Commercial Bank of 
Albany " was as follows : that said company should 
have succession, be capable of suing and being sued, 
have a common seal, &c., and should " have and 
possess all incidental and necessary powers to carry 
on the business of -banking, — ^by discounting bills, 
notes, and other evidences of debt ; by receiving 
deposits ; by buying gold and silver bullion, and 
foreign coins ; by buying and selling bills of ex- 
change, and by issuing bills, notes and other evi- 
dences of debt ; but the said company shall have 
and possess no other powers whatever, except such 
as are expressly granted by this act." Then the 
company is forbidden to trade, or to carry on " its 
operations of discount and deposit " elsewhere than 
in the city of Albany, (m) 

(m) La-v^B 1826, p.' 198, § 1. 



XXVIU INTRODUCTION. 

The specification of banking powers in the charter 
of this bank was adopted by the Eevisers and the 
legislature, in 1827, as a definition of the term "bank- 
ing powers ;" (n) and the prohiMtion contained in 
this charter, that said banking corporation should 
have and possess no other powers except those 
thereby expressly granted, has now become a part 
of the general Statute Law of this State, applicable 
to all corporations, (d) 

In the year 1826, no bank charters were granted, 
(p) Numerous applications for acts incorporating 
banking companies were made and pressed upon the 
legislature, but all were rejected, or indefinitely 
postponed, by a large majority of the senators, (gf) 
tiiM*^mr. Events, however, occurred in 1826 which induced 
the legislature of 1827 to enact a most stringent 
and general code of statute regulations in relation 
to moneyed corporations, (qq) 

In February, 1826, a committfee of the Senate, of 
which Silas Wright was chairman, recommended 
that one of the senators be expelled from the Senate,, 
on the ground that the means used by him in ob- 
taining charters of certain insurance companies were 
a violation of his duties as a seng,tor, tended to cor- 

(«) 1 E. S. 600, § 4. See p. 26, post, and note. 

(o) IE. S. 600, § 8. See p. 26, post, and note. 

(jj) See Sess. Laws of 1826. 

(g) Hammond's Hist. vol. iii., p. 6T. 

(qq) See Statute Eegulations, pp. I-IV, post 



USTTRODUCTIOIf. XXiX 

rupt tlie public morals, and to impair the public 
confidence in tlie integrity of the legislature. The 
senator implicated, before any action by the Senate 
upon the resolution for his expulsion, resigned his 
seat as a member of that body, (f) 

In the summer and fall of 1826 and early in 182Y, conspir.- 

oy trials of 

several most respectable and influential citizens, ini|?_^"* - 
the city of New York, were indicted and tried for 
an alleged conspiracy to defraud the Morris Canal 
& Banking Company, the Fulton Bank, the Trades- 
mens' Bank, the Mercantile Insurance Company, the 
Merchants' Kre Insurance Company, and other 
moneyed institutions. 

Several of the officers and directors or managing 
agents of the "Life & Fire Insurance Company," 
the " Sun Fire Insurance Company," the " United 
States Lombard Association," and the "Madison 
Fire Insurance Company," were implicated in these 
criminal prosecutions, which were widely and gen- 
erally known and designated at the time as the 
" coTispiracy t/rialsr 

The high sta,nding, reputed wealth, and eminent 
talents of the persons indicted, — and the vkst num- 
ber of stockholders and bondholders ruined by the 
frauds committed by the officers and directors of so 
many moneyed corporations, made these criminal 
trials famous throughout the country, — and the 

if) Hammond's History, toL iii., pp. 68, Y7. 



XXX INTRODUCTION. 

fraudulent practices thereby disclosed, produced,- in 
this State, the most intense excitement and alarm. 

Among the operations which these trials brought 
to view, none, perhaps, were more clearly revealed 
than those which had been carried on by the 
managers of " The Life & Fire Insurance Com- 
pany" This company was originally chartered in 
1822, by the name of "The New York Mechanic 
Life Insurance & Coal Company," and was author- 
ized to have a capital of $600,000, to make insurance 
on lives, to grant annuities, to purchase, sell, and 
work any mine or mines of coal, &c. (s) In 1823, 
the legislature changed its corporate name to the 
"Life & Fire Insurance Company," and authorized 
it to make contracts of insurance " against loss or 
damage hy f/re." {() 

The legislature, in 1824, further enlarged the 
powers of this company by enacting, that " all the 
powers given to the Farmers' Fire Insurance & Loan 
Company in relation to receiving trusts, be and the 
same are hereby extended to the Life & Fire In- 
surance Company." (m) 

The Life & Fire Insurance Company was eoa- 
pressly authorized, by its original and amended 
charter, to make iasurances upon lives ; to grant 



(«) Laws of 1822, p. 54. (<) Laws of 1823, p. 177. 

(«) Laws of 1824, pp. 234, 23B, § 2. As to the powers conferred oa 
the Farmers' Kre Insurance & Loan Company, see Laws of 1822, chap. 
240, p. 254. 



INTRODUCTION. ^^^ 

annuities; to insure buHdings against loss or damage 
by fire; to work, explore, purchase, and sell coal 
mines; to purchase real estate for tlie transaction of 
its business ; to take by deed or devise, real and 
personal property left or conveyed to it in trust; to 
assume, perfonn, and execute any trust wMcli kad 
been, Or migkt be created or declared by any deed 
or devise ; and to make loans of its capital stock, 
funds, or moneys, upon bonds secured by mortgages 
upon real estate. Clotked witk express powers so 
various and extensive, tkis company issued and put 
in circulation its bonds to tke amount of about 
$1,300,000. 

But from tke uncontrOverted evidence of tke 
secretary of tke company, it satisfactorily appeared 
tkat tkese issues were not made for any of tke pur- 
poses specified in tke ckarter, nor for tke payment 
of office-rent, clerk-kire, or contingent expenses of 
tke company. Tke principal business of tkis cor- 
poration was to get its bonds into circulation, witk 
a view to raise funds. Tkis was usually done, eitker 
tkrougk tke medium of an exokange of securities 
witk tke dealers, or by a direct sale of tke obliga- 
tions ia tke market, to purckasers, for cask, {v) 

Tke form of tke securities, called lAfe & JFi/re 
Bonds, " was tkat of ordinary post notes of banking 
institutions, printed upon an engraved plate, witk a 

iy) Att. Gen. v. Life & Fire Ins. Co. (9 Paige K. 4'72-4'75.) 



XXXU IKTEODUCTION. 

vignette, and otter devices wMch are usual upon 
notes issued as a circulating medium ; the number, 
date, amount, payee, and time of payment being left 
blank in the engraved plate, and filled up in writing, 
signed by the president of the corporation, and 
counter-signed by the secretary thereof (w) 

They were made payable to some one of the 
clerks of the company, and endorsed in blank by 
him ; his name being used to facilitate the opera- 
rations of the corporation, in issuing and putting 
the paper in circulation, (a?) 

The United States Lombard Association, in the 
short space of ten months, issued similar bonds, 
styled " Lombard Bonds, " to the amount of 
$1,000,000, and at the time of its failure, had out- 
standing unpaid $600,000. There was also an issue 
of bonds called the " Hudson and Lombard Bonds." 

" We have seen," says an able writer of that day, 
"that these Companies, whUe presenting to the 
public eye separate and independent institutions, 
subscribed for by different persons, governed by 
separate Boards of Directors, each having appa- 
rently an exclusive capital, — were aU connected 
together in one common bond, for the attainment of 
one common purpose. We have seen them moved 
by the same wires — pledging, hypothecating, and 

(w) See forms of the Life ^ Fire Bonds, pp. 43, 122, post. 

{x) See 9 Paige R., 471, 472-476 ; 4 ihid., 224. See forms 4S, 122, n., post. 



INTEODTJCTIOK. XXXIU 

transferring tlie same wortliless bonds, the same 
worthless notes, the same depreciated stock, and 
offering the same bankrupt securities." It also ap- 
peared, that affidavits were made that the capitals 
of several of the corporations, implicated had been 
fully paid, when ia fact not one dollar had been paid. 
Among the actors in these scenes, were some of the 
principal agents of influential moneyed institutions. 
"It is not surprising," said Judge Edwards, "that 
conspiracies composed of men of so much talent, and 
avaihng themselves of their high standing, should 
have swept society as with the besom of destruc- 
tion." (y) 

. In the case of the Attorney General v. The Life 
& Fire Insurance Company^ (z) the Referees re- 
ported to the Chancellor, that all the " Idfe <& Fire 
Bonds " proved before them were null and void, 
and furnished no evidence of any valid debt against 
the company ; that it had been urged before them, 
' that if these bonds were void, still they were com- 
petent evidences of money had and received by the 
company to the use of the holders ; but that they 
could not yield their assent to this proposition, — for 

(i/) In January, 1827, Hyatt and others were sentenced to the Peniten- 
tiary. See remarks of Ogden Edwards, Presiding Judge at the time of 
passing sentence on the convicted parties. (N. Y. Evening Post, Jan. 3, 
182'?.) See, also, " Trial of Jacob Barker and others for an alleged Conspi- 
racy, New York, 182'7." Also a "Letter to the New York Delegation iu 
the Legislature, on the Uses and Abuses of Incorporations." (N. Y. Even- 
ing Post, Feb. 7-9, 1827.) 

(s) 9 Paige R„ 470. 



xxxiv INTRODUCTIOlir. 

if the dealings in question were proMbited by the 
charter or by the general BeWaining Act, or by 
either of them, both the express and im$lkd con- 
tracts were alike null and void; that to establish 
that the latter was valid, while the former was void, 
would be opening a door to evade the force and 
policy of the law ; that all dealers in the Ufe & 
Fire Bonds of this company were bound to look 
to its authority to issue them ; and that in legal 
contemplation they did know, or were bound to 
know, that the company was transgressing its legit- 
imate powers, (a) 

Jacob Barker and others excepted to the report 
of the Eeferees, and upon their exceptions, the de- 
cision of the Eeferees was reviewed by the Chan- 
cellor, who confirmed the report. 

In giving his opinion, the Ghmcellor said, — 
" It was an attempt, on the part of those who had 
the control of the affairs of this company, to carry 
on banking business instead of the business for 
which they professedly obtained their charter. 
They in fact carried on the business of discounting 
notes, bonds, and mortgages, and other securities 
for money, giving in exchange therefor these bills 
or bonds, endorsed in blank by their own clerks 
and others, as negotiable securities, which were 
intended to be, and actually were, put in circulation 



(a) 9 Paige R., 476. 



INTRODUCTION. ^^"^ 

as money; in the same manner as tlie post-notes 
of incorporated banks were issued and circulated 
as money before the issuing of such notes was pro- 
hibited by law. (h) * * * * There was suf- 
ficient on the face of these bonds to show that they 
were intended as a circulating medium, and were 
not given by the company to the payees thereof 
for an actual indebtedness in the course of the 
legitimate business of the company. At least, 
there was sufficient to put those who received them 
upon inquiry as to the fact, whether they were 
really given for any purpose within the authority of 
the corporation, and not in violation of the laWs of 
the State." (c) 

Since the disclosures of 1825 and 1826, there has 
been no direct evidence of corruption, as a means 
of procuring bank or other charters. "The dis- 
graceful scenes of 1812, 1824, and 1825," says Ham- 
mond, "will never be renewed." (d) 

Not one bank charter was granted in 182Y. (e) 
The " Conspiracy Trials " were stiU in progress, and 
the excitement produced by them was unabated, 
when the legislature met in January, 182Y. Gov- 
ernor Clinton, in his annual message to that body, 
stated that the then alarming commercial convul- 

(5) See § 35, p. 38, post, and § 4, p. 114, poaf. 

(c) 9 Paige R., 470, ill ; 4 ibid., 224. 

(d) Hamniond's History, vol. iii., p. IS. 

(e) La-wB of 1827. 



XXXvi INTRODUCTION. 

sions stould inculcate tlie necessity of avoiding a 
recurrence of such calamities, by avoiding tlie causes 
wMch produced them ; that the calamitous derange- 
ments in England (/) had been ascribed to a 
transition state from war to peace, and to excess of 
production; but the better opinion then was that 
they were chiefly imputable to excessive emissions 
of paper money in the shape of bank notes ; and as 
similar disasters, were experienced almost contem- 
poraneously in this country, that they might be 
traced to similar causes ; that a bank might issue 
notes to three times the amount of its capital paid 
in ; that this was intended as a wholesome restric- 
tion, but was in fact a most pernicious authorization 
and could never be justified by any state of things ; 
that the authority to create money would always be 
abused ; that the power of making money was a 
dangerous faculty, and its liability to perversion 
was in proportion to its extension ; that banking 
privileges deposited in unskillful hands might be 
abused without design — but when granted to fraudu- 
lent men, who preferred wealth to character, there 
would be no bounds to the evils that would ensue ; 



f/) In England, during 1826, a large proportion of the country banks 
were swept off, and produced by their fall an extent of ruin that has 
hardly been equaled in any country. Moye than seventy of these banking 
establishments were destroyed in the short space of six weeks. The lucky 
discovery in the Bank of England of an " old box, containing a quantity of 
one-pound notes," which had been overlooked, saved the country. (Law- 
son's Hiat. of Banking, p. 113. MeCuUoch's Diet., Article ''Banking.") 



INTRODUOTION". XXXVil 

that experience liad proved tliat applications for 
banking privileges were made for personal benefit, 
and not for the public accommodation. In con- 
clusion, lie recommended great caution and more 
than ordinary circumspection in making such grants 
in future ; and stated that " some general restrictions 
were indispensably necessary for limiting the issue 
of bank paper,— for requiring the possession of a 
certain quantity of metallic money, and adequate 
security for the redemption of bank notes, — for 
compelling the attendance and increasing the respon- 
sibility of the directors, — for detecting misstate- 
ments in the periodical renditions of the state of 
banking institutions, — and for prohibiting the circu- 
lation of bank notes below a certain sum. (/) 

The views expressed by Governor Clinton in his 
message of 1827, as to the real causes which pro- 
duced the commercial and calamitous derangement 
in England in 1825, and in this country in 1826, 
have since been more than confirmed by the most 

(/) See Governor Clinton's Message, 182'7. 

"It appears from a published table of the schemes and bubbles projected 
in England, in 1824, that they amounted to 243, — that the amount of 

capital proposed to be subscribed on these schemes was £248,000,000, 

that the amount actually paid up was £43,062,608, — and that the balance 
due on the whole of them at the close of the year 1825, was £204,937,392. 
Numerous other schemes, to which equal publicity was not given, are 
known to have been projected throughout the United Kingdom. And 
without exaggeration, it may be inferred — though the statement may as- 
tonish dupes and directors — that the bubble mania (1825), if carried into 
execution to its meditated extent, would have required (if it could have 
been procured) a capital of £350,000,000 sterling." (Lawson's Hist, of 
Banking, pp. 61, 68.) 

d 



SUtnte 
rcffalatioDS 
of 182T. 



xxxviii INTRODUCTION. 

sagacious and able writers on tlie subjects of bank- 
ing and currency, {g) 

Governor Clinton, in April 1827, appointed Jolin 
C. Spencer, tlien a member of the State Senate, one 
of the Revisers of the statutes of this State. 

In September, 1827, John Duer, John C. Spencer, 
and Benjamin F. Butler, — constituting the Bowrd 
of Revisers^ — ^reported to the^ legislature general 
Statute Regulations to govern all moneyed corpora- 
tions which should be created in this State, unless 
expressly exempted by their charters from its pro- 
visions. These elaborate regulations are contained 
in chapter eighteen of the first part of the Revised 
Statutes. (_/) This chapter was enacted in Decem- 
ber, 1827, and took effect January 1st, 1828. (I) 

These statute regulations, relating to moneyed 
corporations, were prepared by Revisers familiarly 
acquainted with the scenes and events of 1825 and 
1826, to which reference has been made, — and were 
enacted by the legislature in 1827, in the midst of 
the disclosures of the " conspiracy trials." (m) 

{g) McCuUoch's Diet., Article "Banking." Lawson's Hist, of Banking. 
Gilbart on Banking. 

(j) 1 R. S. 588. See pp. 1-28, post. 

{I) Laws 1829, pp. 11, 12, 13, 14. §§ 1, 2, 4. 

(»i) Mr. Gouge states in his History of Paper-money and Banking in 
the United States, pp. 185, 186, IST, that " in April, 1826, the ' Marble 
Manufacturing Company,' a newly instituted bond-issuing concern, became 
bankrupt" — that in July, August, and September, 1826, followed the bank- 
ruptcies of the " Green County Bank," the " United States Lombard," the 
"Franklin Manufacturing Company," the "Hudson Insurance Company," 
the " New York Life Insurance Company," the " New York Mount Hope 



INTRODUCTION. XXXIX 

For nearly thirty years these Statute Eegulations 
applicaUe to moneyed corporations, have been in 
force in this State. We can only allude to some of 
their leading features. 

The stringent provisions in chapter eighteen " to 
prevent the insolvency of moneyed corporations, 
and to secure the rights of their creditors and 
stockholders " were intended by the Revisers as a 
substitute, in part, for the act of 1825, "to pre- 
vent fraudulent hanhrutptcies ly incorporated com- 
panies,^'' (&c, (n) 

The main objects sought to be attained by the 
general statute regulations reported by the Eevisers, 
were : to secure the actual payment of the capital 
on which the operations of a moneyed corporation 
are founded, and to prevent the capital paid in 
being withdrawn or diminished (o) ; to prevent 
dividends being made, except from actual profits (p); 
to prevent a fraudvlent application or trafisfer of 

Loan Company," the " Sun Fire Insurance," the " Greenwich Insurance," 
and the " Protection Fire Insurance Companies." In May, 1827, the ease 
of Lambert v. The People (1 Cowen, 166) was heard and determined by 
the Supreme Court. In June, 1827, the same ease was argued before the 
late Court for the Correction of Errors. In September, 1827, that Court 
ordered a re-argument, and decided the case in December, 1827 (9 Cowen, 
578, note a; see note b at the end of the case, on pp. 624, 625). Mr. Spencer, 
one of the Revisers, was a member of the Senate in- 1826 and 1827 — and 
Mr. Butler was the counsel of Jacob Barter. (See Conspiracy Trials ; also 
see The People v. JEckford, Barker, and others (7 Cowen, 535). The Pea-- 
pie V. Vermilyea, Brown, and others (7 Cowen, 408). 

(n) See 3 R. S., 2d ed., p. 630, 

(o) See § 1, sub. 2, p. i,post; § 29, p. \*l,post. 

(pi) See § 1, sub. 1, p. 3, post. 



xl ISTBODTJCTION. 

the property and funds of a company, by its direc- 
tors or officers (q); "to prevent directors from 
employing the funds of the company in the 
purchase of shares of its own stock," &c. (r) ; " to 
prevent speculators, by means of hypothecated 
stock or otherwise, from acquiring a control of a 
company in defiance of the wishes of the real 
stockholders " (s) ; and " in the event of msohency^ 
to secure an equal distribution of the effects of a 
company amongst all its creditors^ (u) 

In January, 1828, there were two distinct systems 
of statute law in force relating to moneyed corpora- 
tions, — one applicable to those existing prior to 
that time ; the other to govern all which should be 
created after January 1st, 1828. (v) 

The early bank charters, containing no reservation 
of power to the legislature to alter or repeal them, 
were regarded as contracts. It was, therefore. 



(j) See §§ 1, 8, pp. 6, 7, post, and notes ; also Oillet t. Phillips (3 Ker- 
nan, 114). 

(r) See § 1, sub. 6, p. 4, post. 

(a) See §§ 37 to 43, pp. 19-21, jsosi. 

(u) See § 9, pp. 8, 9, pout, and note; also Oillet v. Phillips (3 Kernan, 114), 
and Brouwer v. Harbeek, decided in the Court of Appeals in March, 1854, 
See note (5), p. 9,^o»<. See Revisers' Notes (8 R. S. 2d ed. p. 630). ^ 

(v). 1 R. S. 601, chap. 18, title iv. "Special provisions relating to cer- 
tain eorporations." These are applicable to corporations created before Jan- 
vary 1st, 1828 ; and to certain other corporations not embraced in Title II. 
of Chapter 18 ; 1 R. S. 588, 689, chap. 18, title ii. Tlie provisions of this 
Title II. are applicable to moneyed corporations created, &o., after Jamuiry 
1st, 1828. See p. \,post, and note; also, § 52, p. 23, post; also, 3 R. S, 2d. 
ed. p. 530. 



INTRODTTCTION'. xli 

deemed a questionalble exercise of legislative power, 
to subject then existing corporations to the new and 
stringent regulations contained in the second title of 
the eighteenth, chapter, before referred to. By- 
section fifty-two of that chapter, the legislature 
Hmited the application of the provisions of the 
second title to nioneyed corporations created after 
January Ist^ 1838. (w) 

The system of statute regulations reported by the 
Revisers and adopted by the legislature in 1827, for 
the government of all future moneyed corporations, 
was in force during the whole of the year 1828. 
Not a single bank charter, however, was granted in 
that year. 

This new system of statute law provided for the 
personal liability of the stockholders, and imposed 
penalties upon directors of moneyed corporations 
which were regarded as too onerous and severe, (a?) 
Responsible parties were indisposed to become 
directors of moneyed corporations subject to such 
a code of laws. No bank charters were granted 
until after the objectionable provisions, above re- 
ferred to, were modified or repealed by an act 
passed in April, 1829. (jf) 

January, 1829, Governor Van Bur en in his 

(m) Laws 1829, p. 2C, § 16; also, § 52, p. iZ, post, 
(x) See §§ 11 to 19, pp. 10-13, post ; also, p. IS, post, and note, 
(y) See §g 30, 31, of Safety Fund Act of 1829, pp. 36, 31, post; also p. 
IS, post, and note. 



xlii INTRODUCTION. 

annual message to the legislature, stated that 
of the forty banks then in operation in this State, 
the charters of ihiri/y-ofie would expire in two, 
three, and four years ; (s) that the collective cap- 
ital of these thirty-one banks, actually paid in, 
amounted to $15,000,000 ; the debts due to them 
to more than $30,000,000 ; and that the debts due 
from them to the community, including their stock- 
holders, amounted to about $30,000,000 ; that the 
policy pursued of requiring the payment of a large 
honus to the State, or the performance of service, 
as the ^ice of bank charters, was condemned by 
experience ; that the unbiased judgment of all ob- 
serving and thinking men, would concur in regard- 
ing it as an expedient from which no good had 
resulted; that its tendency had always been to 
weaken the security of the public in these institu- 
tions for the performance of that in which the pub- 
lic interest mainly consisted — the faithful redemp- 
tion of their paper ; that all the conditions that 
should be prescribed should refer exclusively to the 
safety and stability of these institutions ; that " our 
chief duty in this respect is to see that the farmer 

(2) During the session -which commenced in January, 1825, application 
■was made for charters for new banking, insurance, and other companies, 
■with nominal capitals of the amount of $52,000,000. During the session 
commencing January 1, 1826, applications -were made for charters for 
128 banking and other moneyed corporations, -with nominal capitals of 
$55,637,000. (Gouge's Hist, of Banking, pp. 179, 186.) Only two banks 
were chartered in 1826, and none in 1826, 1827, or 1828. (See Session 
Laws of those years.) 



INTRODUCTION. xliii 

when lie exclianges Ms produce or estate, the me- 
chanic his wares, the merchant his goods, and all 
classes of the community their property or services, 
for bank paper, may rest contented as to its value ;" 
that provisions invalidating all confidential assign- 
ments or trusts of any description — imposing severe 
penalties upon acts designed to divert the funds 
from the appropriation which, in justice and policy, 
ought to be made of them were of value, — and that 
the importance of some more efficient safeguards 
had been felt by former legislatures, (a) 

From January, 1829, to April 2d, 1829, the legis- 
lature, instead of granting or renewing any bank^f"mT'*" 
charter, were engaged in discussing and perfecting 
a general act, applicable to all moneyed corpora- 
tions, having lanhing powers, which should be 
thereafter created in this State. This general act 
amended or modified some of the provisions of the 
general Statute Eegulations of 1827, relating to 
that class (b) of moneyed corporations ; and pro- 
vided also for a perpetual fund, to be denomi- 
nated the '■'■ianh fimdP Hence this amendatory 
act has ever since been known as the Safety Fund 
ActoflS^^. 

It was passed on the 2d day of April, in that year, 
under the title of " An Act to create a fund for the 

(a) See Governor Van Burcn's Message, Jan , 1829. 
(6) See definition of the term "moneyed corporation," as used in Ihe 
Eevised Statutes,— § 51, p. i.Z,post. See § 30 4 § 31, pp. 36, Z1,po3t. 



xliv INTRODUCTION. 

benefit of certain moneyed corporations, — and for 
other purposes^ (6) 

One of the most important provisions of the act 
of 1829, is the express prohibition contaiaed ia the 
thirty-fifth section. By this, every moneyed corpo- 
ration subject to the act was prohibited from is-svr 
ing any bill or note payable on time ; or payable 
with interest, (d) This act also provided for the 
visitation and inspection of Sank Commissioners. 

Experience has demonstrated, that the statutory 
prohibition of 1829, against the issue of post notes 
by banks, has been more effectual, during the last 
twenty-five years, in securing to the citizens of this 
State a uniform and sound currency, and preventing 
bank insolvency, than all the restrictions and prohib- 
itions in the statutory regulations of 182*7. " No 



(c) Laws of 1829, p. 167. See pp. 29-38, post Governor Van Buren, 
in his message of 1829, said that a former legislature had attempted to fur- 
nish more efficient safeguards, " through the medium of a personal responsi- 
bility of the stockholders. [See §§ 11 to 19, pp. 10-13, post.'\ But it is 
objected, that the practical operation of such a provision, would be to 
defeat the object in view, by throwing this species of property, and of 
course its management, into the hands of irresponsible men ;" and the Gov- 
ernor advised that such an experiment had better not be tried ; that it would 
be unsuooessfal, and the consequences to flow from it disastrous. (See Gov. 
Van Buren's Meosage, January, 1829.) The Bank Fund, created under the 
provisions of the general amendatory act of 1829, was intended as a substi- 
tute for the personal liability of stockholders in cases of insolvency, as pro- 
vided in the sections of the general code, in part repealed by the act of 
1829. As to the eflFeet of laws imposing upon stockholders in banking com- 
panies, a personal liability for debts, see evidence of Gen. Austin and of V. 
Stiokney, before a Committee of the House of Commons, 1836, pp. 91, 127 ; 
Carey on the Credit System, London, 1838, p. 128, and note. 

{d) See § 35, p. 88, post ; also, § 4, p. 114, post, and note. 



INTRODTTCTION-. xlv 

man or set of men," says Mr. McCuUocli, " lias ever 
had power to make unrestricted issues of paper, with- 
out abusing it." (dd) 

Under the safety-fund system, — "bank charters 

•' •' ' Leading 

were of one unvarying form. These charters gave Ky-flTnd' 

bank char- 

a name to these institutions, fixed the place where t^rs. 
their operations of discount and deposit should be 
carried on ; the time when their corporate existence 
should terminate, and the amount of their respect- 
ive capitals. They also specified the precise powers 
which these banks should possess in addition to the 
general powers enumerated in the eighteenth chap- 
ter of the first part of the Revised Statutes, (e) 

These institutions were expressly prohibited from 
trading in State stocks, goods, wares, or merchan- 
dise, and from commencing the business of banking 
until the whole of their capital stock should be paid 
in specie. (/) They were also inhibited from hav- 
ing in circulation at any one time an amount of 
notes or bills exceeding twice their capitals ; while 
their loans and discounts were limited to an amount 
not exceeding twice and a half their capitals, (g) 



(dd) See MoCullooh'B Notes to Smith's Wealth of Nations, p. 491. 
ZeavittY. Palmer (3 Comstock, 19, S3); Ontario Banh v. Schermerhorn {9 
Paige, 109, 118, 114), See, also, § 4, p. 114, post, and note; and note 18, 
pp. 300-305, ^os«, 

(e) See Safety-Fund Bank Charters in Session Laws 1829 to 1836. See, 
also, §§ 1, 2 (Revised Statutes), pp. 24, 25, post. 

(/) See Safety Fund Bank Charters; also, § 34, p. SS,post. 

(c/) Se6 § 27, p. S6,post. 



xlvi INTRODUCTION, 

They were required to contribute annually one 
half of one per cent, upon their capitals (not 
exceeding in all three per cent.), for the purpose of 
creating and continuing a fund to be denominated a 
"bank fund;" and they were subject to the visitation 
and inspection of Bank Commissioners. (K) 
eatet'^fund "^ ^^^^ ycars' trial of this system fully proved, 
TXk that the "bank fund" was wholly inadequate as 
an indemnity fund ; that the prohibition against the 
issue of bills or notes ; exceeding twice the capital, 
and against loans and discounts exceeding twice and 
a Ticdf the capital, afforded no guaranty to the public 
against bank insolvency(TO). It has also been proved 
that the carefully contrived statute regulations of 
1827 (w), requiring all banks to make annual state- 
ments to- the Bank Commissioners, verified by the 
oaths of their officers, — were in many cases good for 
nolihing, except to delude or deceive the public as 
to the real condition of their affairs; that the 
accounts of the banks that broke looked as well in 
these official statements as did those of the institu- 
tions that continued solvent; — that bankrupt and 
fraudulent concerns alone gained, by a code of regu- 
lations that could not be enforced, — inasmuch, as it 
enabled them, by appearing to be prosperous, the 
better to deceive and blind the public. It had also 

(7() See §§ 2, 3, 4, 15-27, pp. 29, 30, 38-36, pott. 
(m) Gouge's Hist, of Paper Money, p. 61. 
(«) See §§ 19, 20, pp. 18-15, post. 



INTRODUCTION. xlvii 

been demonstrated, that the quarterly inspection of 
the Bank Commissioners, armed as they were with 
the power to send for persons and papers (o), and 
to examine iato all violations and abuses of law 
by incorporated banking institutions, furnished no 
reliable security to the public ; and that the peri- 
odical visits and examinations of these public inspec- 
tors, restrained only those officers and directors who 
did not require to be placed under any sort of sur- 
veillance, while they afforded to less conscientious 
managers an opportunity, by misleading the Bank 
Commissioners, and by making false and exagger- 
ated statements of the affairs of their institutions, to 
get their condition represented as most prosperous, 
when perhaps it was quite the reverse. But, even in 
cases where the managing directors were perfectly 
honest, it was found that the publication of a hal- 
ance sheet afforded no certain information as to the 
actual condition of a bank; that bank directors 
were, like all other sanguine people, strongly in- 
clined to over-estimate the real values of the 
corporate assets ; and thus, that debts and bills 
receivable estimated, in the official statement, as if 
they were worth so much bullion, turned out in the 
end to be worth nothing, (p) 



(o) Lavs 1827, p. 66. 

(p) MoCuUoch's Notes to Smith's Wealth of Nations, Edin. ed. (1846), 
p. 503. MoCuUoch's Diet, article "Banks." Gouge's Hist, of Paper Money, 
p. 61. 



xlviii mTEODUCTION. 

It has been sIio-Wti that the Bank of England was 
prohibited from engaging in any commercial or 
mercantile undertaking, other than dealing in bills 
of exchange and gold and silver ; and yet this insti- 
tution conducts the whole banking business of the 
British Government. " It acts," says Adam Smith, 
"not only as an ordinary bank, but as a great 
engine of State." {£) 

It has also been seen, that for nearly half a 
century this State carefully inserted in every bank 
charter, an eaypress prohibition against trading in 
government stocks (f) or in goods and mer- 
chandise. 



(q) MoCuUooh'a Diet, article " Banlc of England" 

(r) London Banking Circular of January l'7th, 1840, contains the follow- 
ing declaration; — 

'■ Any mercantile traffic conducted by a bank, beyond that of discount- 
ing and remitting bills created by the sale or consignment of produce, 
ought to be suppressed by public indignation. If they speculate in any 
commodity ybr profit, and not merely to protect themselves against an appre- 
hended loss, they ought to lose the power of conducting banking affairs, on 
proof of such an act of delinquency being established." 

" After the instructive lessons of experience, which events have recently 
imparted, any bank in the United States, that should be weak and foolish 
enough to enter into the business of merchants from the love of profit, would 
exhibit evidence of unfitness for the discharge of their professional duties, 
coming very near to a symptom of insanity." — (London Banking Circular, 
Jariuaryllth, 1840.) 

In the case of the Bank Commissioners v. The St. Lawrence Bank (8 Sei- 
dell, 513, 516, Gakdiner, J., said, "The purchase of the stock for the 
purpose of pledging or selling it, as a means of raising money, is not within 
the powers conferred by the 18th section of the Statute to authorize the 
business of banking. Such an operation would be evidence of itself, that 
the institution was seriously embarrassed, if not insolvent, and cannot, with 
any propriety, be deemed a necessary incident to the power of banking." 
See also Talmage v. Pell (3 Selden, 328). 



INTKODUCnON. xlix 

"We have also shown that this express prohibition 
against trading was continued by the legislature of 
this State, from an abundance of caution, in aU. bank 
charters granted after 1825, which contained a pre- 
cise enumeration of banking powers^ — and in those 
also, which were obtained after the enactment of 
the Revised Statutes, which declare, that in addition 
to certain general powers therein enumerated, and 
to those expressly given in its charter, or in the act 
under which it is or shall be iucorporated, "«.<? 
corporation shall possess or exercise any corporate 
powers, except such as shall be necessary to the ex- 
ercise of the powers so enumerated and given." {s) 
In January 1838, all the banks in this State, and 
throughout the United States, were in a state of 
suspension; the "bank fund" was itself bankrupt; 
and the confidence of the public in the safety of the 
hanking system of 1829, was swept entirely away. {£) 
On the 11th of April, 1838, one hundred and 
forty-three bank delegates from eighteen States, 
met in convention in the city of New York, 



(j) 1 E. S. 600, § 3. See § 3, p. 26, ■post, and Talmage v. Pell (3 Selden, 
328, 346). See also §§ 1, 2, pp. 24, 26, post, 

(t) May 10th, 1837, all the bants in the city of New York, by common 
consent, stopped payments in specie ; and immediately afterwards the banks 
throughout the State were in a state of suspension. On the 16th of May, 
1837, the legislature passed an act "suspendfng, for a limited time, certain 
provisions of law, and for other purposes." (Laws 1837, p. 514.) By this 
act, every provision of law then in force, requiring or authorizing pro- 
ceedings against any bank in this State, with a view to forfeit its charter, 
was " suspended for one year." This power cannot now be exercised by 
the legislature without a violation of the Constitution of 1846. (See § 5, 
p. i&5,pott.) 



1 INTEODUCTIOK 

for the purpose of considering tlie subject of the 
resumption of specie payments. This convention 
resolved- — " that it be recommended to all the banks 
of the several States to resume specie payments on 
the first Monday of January next (1839) ; without 
precluding an earlier resumption on the part of such 
banks as may find it necessary, or deem it proper." 
This resolution was carried by a large majority, 
fourteen States voting for it, and two only voting 
against it. (t() This convention of bank" delegates 
adjourned on the 16th day of April, 1838 ; and 
two days thereafter (April 18, 1838), the legisla- 
ture of this State passed an act entitled, " An Act 
to authorize the business of JBcmhing.'" (it) 

Before taking up the provisions of this important 
act, let us see what theories were then held by 
eminent political economists in reference to bank 
issues and currency, and how it was proposed to 
remedy the evils which had resulted, both in En- 
gland and in this country, from excessive issues of 
paper-money. 
Ecmejy The pauic of 1825, in England, provoked a most 

proposed. ^ ^ , ~ ^ 

rigid scrutiny into the whole banking system of 
Great Britain. Paper money, and the principles 
upon which alone its value can be maintained and 
banking safely carried on, were discussed in Parlia- 
ment, and by the most eminent writers on these 
subjects both in Europe and in the United States. 

(«) American Almanac, Boston, 1839, pp. 308, S09. (m) See p. 81, poti. 



INTRODUCTION. li 

In February, 1826, Lord Liverpool expressed him- 
self, in the House of Lords, as follows : " The present 
system of law as to banks must now be altered, one 
way or another. It is the most absurd, the most 
inefficient ; it has not one recommendation to stand 
upon. The present system is one of the fullest 
liberty as to what is rotten and had^ but of the 
most complete restriction as to all that is good." (v) 

"What is really wanted," said Mr. McCuUoch, "is 
not a regulation to allow banks with large capitals 
to be set on foot (for there have, at all times, been 
many such banks in England), — ^but a regulation 
to prevent any bank, be its partners few or many, 
from issuing notes without previously gi/ving securil/y 
for their payment." 

Ml'. McCuUoch insisted upon the doctrine, that 
to prevent overissues of bank paper, it was neces- 
sary, not only " to enact that all notes should be 
payable on demand^ — but that it was further neces- 
sary, in order to insure compliance with this enact- 
ment, to prohibit any one from issuing notes until 
he has satisfied the government of his ability to pay 
them." It should also be observed, he said, that in 
recommending that bankers "be obliged to give 
security for their issues, we in fact merely propose 
that a system, already adopted with respect to them, 
should be carried to its proper length. At present, 

(«) Lawson's History of Banking, p. 10. 



lii INTRODUCTIOK 

notes of the Bank of England, and of tlie joint- 
stock and other banks, are proMbited from cir- 
culating unless tbey be payable on demand; and 
it is admitted on all kands tkat tkis is a proper reg- 
ulation. But why is it proper? Because it pre- 
vents any considerable excess of paper from getting 
into circulation (w), and kinders it, so long as it 
continues to circulate, from becoming less valuable 
tkan gold. It is obvious, kowever, tkat tkis regu- 
lation is defective in tke most important particular : 
tke redundancy of paper is not tke only evil to 
be provided against ; it is equally necessary tkat 
means skould be taken to prevent tke circulation of 
wortkless paper ; and tkis cannot be effected by 
merely ordering notes to be paid on being presented. 
Suck an order is obeyed only by opulent and re- 
spectable bankers, and forms no ckeck wkatever on 
tkose of a different ckaracter. It is, tkerefore, in- 
dispensable, if we would make tke order really 
effectual, and prevent tke intention of tke legislature 
from being defeated and tke public defrauded, by 
tke misconduct or bad faitk of tkose lOlio issue paper^ 
to provide a security tkat it skall be complied witk, 
or tkat notes skall, in every case, be paid wken 
presented." It was furtker urged by Mr. McCul- 
lock, tkat it was clear tkat tke " security to be 
given by a bank of issue, ougkt to be proportioned 

{w) See § 35, p. 38, post ; also § 4, p. Wi, post ; also note 78, pp. 300- 
805, poHt. 



INTRODUCTION. liii 

to its issues^ and not to its capital. The former 
mode will effectually protect the public from loss — 
the latter gives little or rather no protection what- 
ever ; that nothing short of the obligation to give 
securities for their issues can ever give the public 
that effectual guaranty for the integrity of the cur- 
rency that is so essential." (x) 

"What objection," said Mr. Ricardo, in his tract 
On cm Economical and Secure Currency, " can there 
be against requiring those who take upon themselves 
the office of furnishing the public with a circulating 
medium, to deposit with government an adequate 
security for the due performance of their engage- 
ments ? In the use of money every one is a trader : 
those whose habits and pursuits are little suited to 
explore the mechanism of trade are obliged to make 
use of money, and are in no way qualified to ascer- 
tain the solidity of the different banks whose paper 
is in circulation ; accordingly we find, that men 
living on limited incomes, women, laborers and 
mechanics of all descriptions, are often severe 
sufferers by the failui*es of banks." 

Bold and reckless speculators may amass fortunes ; 

(k) "A security of this sort has been exacted in the case of the Bank 
of England; and the whole £14,686,000 sterling lent by the bank to gov- 
ernment must be sacrificed, before the holders of her notes can sustain the 
smallest loss. Her stability has, therefore, been truly said, by Dr. Smith, 
to be equal to that of the British QovernmerU." — (McCulloeh's Diet., art. 
" Bank of England." 

See Art. 8, § 6, of the Constitution of the State of New York of 1846, 
pp. 264, 266, post. 



lir HTTEODUOTlOlf. 

"but the laboring classes, salaried of&cers, annuitants 
of every sort, professional men,, medical, legal, and 
clerical, derive little benefit from the golden tar- 
vest " caused by a redundancy of the currency, " but 
always share the full proportion of the reverses 
which inevitably ensue." (y) 

It was objected to the adoption of the plan of 
requiring a pledge of securities with the Government, 
that it would be injurious by locking up a portion 
of the capital of the banks. " But this," said Mr. 
McGulloch, " is plainly an error. Its only effect in 
this respect would be, to force such bankers as issue 
notes, to provide a sv/pplemental capital as a security 
over and above the capital required for conducting 
their business. But this supplemental capital would 
not be unproductive. If it consisted of land, its 
owners would receive the rents ; and if it consisted 
of government securities, they would receive the 
dividends or interest due upon them, in the same 
way as other persons." " There cannot be a doubt 
that this is a case in which Government is bound to 
interfere. We have sustained incomparably more 
mischief from the issue of spurious paper than of 
base coin ; and in order to obviate such mischief 
in future, and to give that security to the public 
which is so essential, we have no alternative, if we 



(y) Baker on Banjjs in the tTnited States (Boston), p. 41. 



INTRODUCTIOK Iv 

will not entirely suppress country notes, but to re- 
quire security from the issuers P 

It was also contended by bankers in England, 
that, except so far as the issue of bills and notes is 
concerned, banking is a private business, (s) But 
it was urged, that whatever bank notes were in law^ 
they were practically and in point of fact a legal 
tender, and could not be rejected without expos- 
ing parties to much inconvenience ; that laborers, 
women, minors^ and every sort of persons, were 
dealers in money, — were incapable of judging of the 
stability of banking institutions, and were conse- 
quently liable to be imposed upon ; and that there- 
fore it was the imperative duty of Oovernment to 
interfere to protect the interests of those who could 
not protect themselves, by compelling all issuers 
of bills or notes on loan, or for circulation as money, 
to give ample security for their payment in specie, 
on demand ; that the issue of notes was, of all 
businesses, tJiat which seemed to hold out the great- 
est prospect of success to the schemes of those whp 
attempt to get rich by preying on the public ; that 
"if a set of individuals, with little or no capital, 
contrive by fair appearances, promises, and similar 
devices, to insinuate themselves into the public 



(s) In ISSY, the legislature of this State repealed so much of the 
Restraining Act as prohibited a person or associatloa of persons not incor- 
porated" from keeping offices for the purpose of receiving deposits, — or 
discounting notes or bills." — (Laws IBS'?, p. 14.) See Note 18, p. 49, post. 



Ivi INTRODUCTION. 

confidence, and can maintain £20,000, J660,000, or 
£100,000 in ciraulation^ they secure a good income 
in tlie meantime, and when the bubble bursts and 
the impostui'e is detected, they are no worse off than 
when they set up the bank. On the contrary, the 
presumption is, that they are a great deal better 
off^ — and that they have taken care to provide, at 
the cost of the creditors and a deceived public, a 
reserve stock for their future maintenance, (a) 

The legislature of 1837 repealed so much of 
the Kestraining Act of 1830 as prohibited a person, 
or association of persons not incoirporated^ from 
keeping an office for the purpose of receiving de- 
posits, or discounting "notes or bills ; but left in full 
force the inhibitions of that act against the issuing 
of bills, notes or other evidences of debt on loan, or 
for circulation as money, by any person, or associa- 
tion of persons. But the repealing act expressly , 
declared that all the provisions of the Restraining 
Act, relating to " incorporated companies " or 
" bodies corporate," remained unrepealed, (w) 

The legislature of 1838, by the general banking 
law, so far modified the Restraining Act, as to 
authorize corjporations organized under it, as well 

(a) See MoCuUooh's Essays on Money, and on Paper Money and Bank- 
ing, Phil, ed., 1851 ; also his Notes on Money to Smith's Wealth of Nations, 
Edin. ed., 1846, pp. 504 — 507 ; also his Dictionary of Commerce, Amer. ed., 
1840, and London ed., 1850, — articles, "Banks," "Banking," <fee. 

(mi) Restraining Act, §§ 3, 6, pp. 41, 42, ■post. Repealing Act of 18S7, §§ 
1 to 4, p. 49, post, and note. 



INTRODUCTION. Ivii 

as individual bankers, to issue, " loan and circulate 
as money " a certain hind of promissory notes, still 
leaving tlie prohibitions of the Restraining Act in 
full force as to every other evidence of debt, (x) 

We proceed to state some of the distinctive prin- 
ciples of the third and, as yet, the latest system of 
New York Banking, introduced by the General 
Bank Act of 1838. 

Under the safety fund system of 1829, banks T^^jy,. 
possessed, with other specified powers, the express *^888^<:o°- 
power to carry on the business of banking " by issu- 
ing bills, notes and other evidences of debt," paya- 
ble on demand and without interest, {y) They 
had the power to create paper money at pleasure, 
within the statutory limit as to the amount, (z) 

But the general banking law of 1838 excludes 
this power from the banking system which it es- 
tablishes. This is effected; [1] by separating the 
issue department from the banhing department, and 
placing the former under the exclusive direction of a 

(x) Chancellor Walworth, in Safford v. Wyckoff (4 Hill, 444), said, " The Act 
of 1838, which only authorizes a certain kind of notes to be put in circula- 
tion as money, leaves the restraining law in full force as to every other 
evidence of debt. These banking associations, therefore, are prohibited 
from Issuing any bills or promissory notes, or.other evidences of debt, for the 
purpose of loaning them, — or having them put in circulation as money — 
whatever forms such evidences of debt may assume." See, also, Warner v. 
Beers (23 Wendell, 118, 158, 159, 188). 

See §§ 3, 6, of the Restraining Act, pp. 41, 42, post ; also §g 1, 2, 3, 
General Bank Act, pp. 81, 8i,post. 

(y) See note, 38 pp. 94, 96, post, 
(z) See § 27, p. 36, post. 



Iviii INTEODUCTIOlir. 

State Officer / and [2] by withholding from corpora- 
tions and individuals organized or acting under the 
general law, any grant of power to loan or circulate 
any promissory notes except such, as shall be 
received from the issue department, countersigned 
and registered in that department, {a) and bearing 
on their face the stamp of the government. 

The two systems differ widely in the modes pre- 
scribed for securing bank issues. Under the system 
of 1829, the " bank fund " was created solely by 
an annual contribution of one half of one per cent, 
(not exceeding ia all tliree per cent.) upon the aggre- 
gate amount of bank capital. (F) This fund was 
liable for the payment of all the dehts^ exclusive of 
capital stock, of any of the safety fund banks that 
should become iosolvent. (p) 

By the system of 1829, the indemnity fund was 
limited to a certain sum, and was applicable to the 
payment of all the debts of insolvent banks exclu- 
sive of capital stock. 

But by the system of 1838, securities in value^ 
equal to the full amount of circulating notes^ issued, 
must be actually transferred to the Issue Depart- 
ment hefore any such notes can be given out or put 



(o) The first fourteen sections of the general law relate exclusively to 
issues and to regulations for the creation and government of the Issue De- 
partment at Albany. See §§ 1 to 15, pp. 81-91, post. 

(6) See §§ 2, 3, i, pp. 29, 30, post. 

(c) See §§ 4, 9, 10, pp. 30, 81, Z%post. 



INTRODUCTION. lix 

in circulation ; and these securities are to be held 
in pledge exclusively for the redemption in specie 
of such circulating notes, (cc) 

Under the one system, the fund was raised by a 
small percentage upon capital^ without reference to 
the amount of issues ; under the other, the fund held 
in pledge is proportioned to the issues^ without any 
reference whatever to the amount of capital, {d) 

The monopoly of banking, which had been created 
by the Kestraining Acts of 1804, 1813, 1818, and 
1830, was swept away by the general law of 1838. 

Bankiag had become a franchise^ derived only by 
special grant from the government. Hence, bank 
charters had become " the motive and the means of 
corruption." (e) The legislature of 1838 broke up 
this monopoly by authorizing banking corporations 
to be organized under a general law. In other words, 
it was made lawful for any number of persons, 
without application to the government^ to organize 
as corporations, for the purpose of "establishing 
offices of discount, deposit, and circulation," upon 
the terms and conditions and subject to the liabih- 



(cc) See § 12, p. 90, post. 

(d) As early as 1837, Mr. Lloyd advocatad in England the principle 
of separating the iuue department from the banking department. But it 
•was not until 1844 that Sir Robert Peel adopted it (coupled with the 
pledge of securities), in reference to the Banl{ of England on the renewal of 
its charter in that year. {Stat. 1 and 8 Vict. u. 32.) See note 29, pp. 
82, 83, 84, post. 

(e) See 23 Wendell, 186. 



Ix INTRODTTCTION. 

ties prescribed by the general law (/), and subject 
also to all general enactments of tbe State applica- 
ble to numeyed corporations whicb are not incon- 
sistent "witb that law. {g) 

By the general bank act, each corporation is 
authorized, without application to the legislature, to 
fix for itself its corporate name ; to designate the 
particular city, town, or village, where its operations 
of discount and deposit shall be carried on ; to de- 
termine the amount of its capital, and the number 
of shares into which it shall be i divided ; to fix the 
period of its corporate existence ; and to provide by 
its articles for an increase of its capital, and the 
number of its associates, from time to time. (Ji) 

Immediately upon the passage of the general bank 
act of 1838, the question as to its being a consti- 
tutional law was raised and discussed in the courts. 
The constitution of 1821 declared that the assent of 
two thirds of the members elected to each branch 
of the legislature should be requisite to every bOl 
"creating, continuing, altering, or renewing any 
body politic or corporate." (^') 

(/) See § 16, p. 91, post. 

ig) In Talmage v. Pell (3 Selden, 328, 340, 341, 34'?), Gardiner, J., said, 
"If the legislature intended to authorize the creation of banking corpora- 
tions, we cannot suppose they designed to provide for a privileged class, 
by exempting them from restrictions imposed upon all others, and deemed 
necessary to protect the public and stockholders against the fraud or im- 
providence of the agents who controlled them." 

(h) See §§ 16, sub. 1, 2, 3, 4, 6, pp. 92, 93, 94, post; and § 20, p. 9%, post. 

{j) See note 11, ■p. 297, post. 



INTRODUCTION. Ixi 

Tlie general banking law did not receive sucli 
assent. It was passed by a majority vote only. The 
Supreme Court and the chancellor held that asso- 
ciations organized under the general law were in 
fact corporations. (Je) 

But the Court of Errors adjudged that they were 
not bodies politic or corporate witTiin the spirit and 
meaning of the constitution ' and that the law was 
constitutionally passed, although it did not receive 
the assent of two thirds of the members elected to 
each branch of the legislature. (J) 

Afterwards, the Supreme Court held that they 
were corporations within the meamng of the Re- 
vised Statutes (1 R. S. 414, § 1), and like other 
moneyed or stock corporations, were liable to taxa- 
tion on their capital, (m) 

* The Court of Errors affirmed the Judgment of the 
Supreme Court, in Supervisors of JViagara v. The 
People^ and held that associations under the general 
banking law were corporations within the meaning 
of 1 Revised Statutes, 414, § 1. (n) 

It has now been directly and expressly adjudged 



(i) Thomas v. Dakin (23 Wend., 9) ; Willoughby v. Comstock (3 Hill, 389) ; 
De Bow V. The People (1 Denio, 9) ; Talmage v. Pell (9 Paige Ch. R., 410). 

(/) Bolander v. Stevens (23 Wend., 103) ; Oifford v. Livingston (2 Denio, 
380). 

(to) Bank of Watertmen T. Assessors of Watertown (25 Wend., 686 ; S. C. 
1 Hill, 616) The People v. 'Supervisors of Niagara (4 Hill, 20). 

(n) Supervisors of Niagara v. The People (1 Hill, 504). See 1 R. S. 414, 
§ l,p. Hi, post. 



Ixii INTRODU0TIOM-. 

by the highest court in the State, thathese a ssocia- 
tions are not only corporations within the meaning 
of the tax law (o), but are " moneyed corporations " 
within the provisions of the Revised Statutes " to 
prevent the insolvency of moneyed corporations, and 
to secure the rights of their creditors and stockhold- 
ers ;" that they are not corporations in a qualified or 
restricted sense, but are such to all intents and pur- 
poses ; and that they are bound and affected by all 
the statutes of this State relating to moneyed cor- 
porations, except only so far as such statutes are 
inconsistent with the general banking law.'(p) 

It has also been finally settled by the Court of 
Appeals that the amendatory statute of May 14th, 
1840 (g-), is not confined, in its interpretation, .to bills 
or notes capable of circulating as money, but, in 
terms, extends alike to all biUs and notes issued by 
a. banking association ; and that such notes are ille- 
gal and void, although made payable in London, in 
British currency (r), or given for State Stocks pur- 
chased to raise money to redeem lawful counter- 
signed circulating notes. (4) 

In Tal/mage v. Pell the Court of Appeals also held 



(o) Supervisors of Niagara v. The People (1 Hill, 604). 

{p) Oillet T. Moody (3 Comstook, 479); Talmage y. Pell (8 Selden, 828). 

(?) See Statute of May 14th, 1840, § 4, p. lU, post. 

(r) Leavitt v Palmer (3 Comstock, 19). 

(s) Bank Oommiasioners v. St. Lawrence Bank (8 Selden, 613). 



INTRODUCTIOK. Ixiii 

that associations under the general law, have no 
power to traffic in State Stocks; that they are 
banking corporations and possess authority only to 
carry on the business of banking in the manner and 
with the pow;ers specified in the general banking 
law. (t) 

Our brief sketch of New- York legislation on the 
subject of banking covers more than half a century. 
It shows that two systems of banking, distinct and 
dissimilar, were successively adopted, tried, and 
abandoned. The first of these was in force from 
1791 to 1829. The second lasted from 1829 to 
1838. Some of their inherent defects and practical 
evils, have, we believe, been clearly shown. 

That our present system is a vast improvement 
on its predecessors, none will deny. It has made the 
business of banking, subject to certain statutory 
restraints, free to all. It cuts off a once fruitful 
source of bribery and corruption. And, finally, 
by its stern provisions in regard to security for all 
issues, it seems to furnish for the public all needful 
safeguards. 

The general law of 1838, modified and amended 
by several later statutes, has now been in operation 
nearly twenty years. In the main it has worked 
well. Its leading principle and most valuable 
feature — that, to wit, which requires ample security 

(t) See §§ 3, 18, and Notes pp. 82, 94, post ; Talmage v. Pell (3 Selden, 
328), and Bank Commissioners t. St. Lawrence Bank (8 Selden, 613.) 



Ixiv INTRODUCTION 

for the redemption in specie of all bank issues — ^has 
since been incorporated in the fundamental law 
of the State of New York, {v) The fact that the 
British Government has also adopted the same prin- 
ciple, and applied it to the Bank of England, will 
not weaken our confidence in its value, (w) 

(v) See Constitution of 1846, p. 266, post. See also p. 84, pott, and 
note, 

{w) See p. 84, post, and note ; also p. liii. ante, note (x). 



STA.TTJTES 

OF THE STATE OF NEW YORK 

EMBRACED IN THIS VOLUME. 



Date. Page. 

1782. An Act to prevent the establishment of amy 
ia/fhk within this State, other tha/n the Bmik 

* of North America, and for incorporating 
the scmve within this State. 

Passed April 11, 1782. 233 

1804. An Act to resi/ram, vnincorporated hankvng 

* assodations. Passed April 11, 1804. 234 

1804. Exyplanatory Act, April, 1804. 235 

1813. An Act to prevent the passing amd receimng 
of iamh notes less than the norrmial value 

* of one dolla/r, a/nd to resi/ram, urmicor- 
porated iamMng associations. 

Passed April 6, 1813. 236 

1816. An Act concerning ianJcs. 

* Passed Nov. 12, 1816. 237 

1818. An Act relative to lamJcs, amd for other 

* fwposes. Passed April 21, 1818. 237 



Ixvi NEW YORK STATUTES. 

Date. Foge. 

1824. An Act to prevent tlie ^passing and receivmg 
* of hank notes, payable otherwise tha/n in 

lawful money of the United States. 

Passed April 12, 1824. 239 

1827. An Act entitled " Of moneyed corpora- 
tions " (1 E. S., 588) 1 

1827. An Act containing ^^Regulations tojprevent 
the insolvency of moneyed corj)orations, 
a/nd to secure the ri.ghts of thei/r creditors 
and stockholders." (1 K. S., 588.) . . 1 

1827. An Act containing '■'■Regulations concern- 
ing the election of directors of m,oneyed 
corporations." (1 E. S., 595.) ... 17 

1827. An Act entitled " Of the construction of 
this title," (Title 11., 1 K. S., 588 ; 1 E. S., 
59S.) 23 

1827. An Act entitled " Cf the general powers, 
privileges, a/nd liaMlities of corporations." 
(1 E. S., 599.) 24 

1829. An Act to create Oj fund fm' the henefit of 

certain m,oneyed corporations, a/nd for 
other pwrposes. Passed April 2, 1829. 29 

1830. An Act entitled " Of unauthorised hanking, 

and the circulat'ion of certain 'notes or evi- 
dences of debt issued hy hanks." (1 E. S., 
712.) Called the Eesteainins Act. . 39 

1830. An Act entitled " Of proceedings against 

corporations in Equity." (2 E. S., 461.) . 50 

1830. An Act entitled " Of the vdlumia/ry dissolu- 
tion of corporations" (2 E. S., 466.) . 64 



NEW TOEK STATUTES. Ixvii 

^'"«- Page. 

1830. An Act entitled " Of proceedings hy and 
against corporations in courts of lam." (2 
K-S.,457.) 240 

1830. An Act entitled " Megulations concerning 
ths assessment of taxes on incorporated 
companies, and the commutation or collec- 
tion thereof?'' (1 R. S., 414.) . . . 224 

1830. An Act entitled " Of promissory notes and 

hills of exchange:' (1 E. S., 767.) . . 253 

1830. An Act entitled " Of the interest.of money?'' 

(IKS., 771.) 260 

1830. An Act concerning hcmk notes. 

Passed April 17, 1830. 75 

1832. An Act to prevent the abatement of suits ly 
or against corporations, in certain cases.. 

Passed April 26, 1832. 230 

1835. An Act to amend the act entitled, " An Act 
to create a fund foi' the benefit of the 
creditors of certain moneyed corporations, 
and for other pu/rposes" passed April 2, 
1829. Passed May 11, 1835. 77 

1835. An Act in relation to bills of exchange and 
promissory notes. 

Passed April 23, 1835. 258 

1837. An Act to repeal in part theUemsed Stat- 
utes relating to vna/uthorised banking, and 
the circulation of certai/n notes or evidences 
of debt issued by banks. 

Passed February 4, 1837. 49» 

1837. An Act to prevent usury. 

Passed May 15, 1837. 262 



Pagj. 



Ixviii SEW TOBK STATUTES. 

Date. 

1838. An Act to avtfwrize the, husmess oflcmTcmg 
{as originally passed, with notes). 

Passed April 18, 1838. 81 

1838. Ak Act to authorize the husmess of tanking 

{as altered Try subsequent legislation). . 211 

1839. Ak Act concerning foreign hank notes. 

Passed May 7, 1839. 107 

ISIO. An Act relating to the redemption of lank 

notes. . Passed May 4, 1840. 109 

1840. Ax Act: to amend the Act, entitled " An Act 

to authorise the business of banking." 

Passed May 14, 1840. 113 

1540. Ax Act to amend the Memsed Statutes in 

relation to proceedings against ahsemt debt- 
ors and foreign corporations. 

Passed May 14, 1840. 245 

1 841. An Act to amend the Act entitled " An Act 

to authorize the business of banking" 
passed April IS, 1838. 

Passed March 15, 1841. 1 

1 

1841. An Act respecting suits and legal proceed- 
ings by or against banking associations. 

Passed March 16, 1841. 125 

1541. An Act respecting the appointment of re- 
* ceivers of moneyed institutions. 

Passed April 27, 1841. 127 

1841. An Act to amend the Ad entitled " An Act 
to auihori^< the business qfbankingJ" 

Passed May 26, 1841. 129 



NEW YORK STATUTES. Ixix 

Date. pjgg 

1842. An Act to repeal cm act entitled '■'■An Act 
respectmg the appointment of Recevoers of 
moneyed institutions,'''' passed April 27, 
1841, a/nd to limit the oornpensation of 
recei/vers. Passed January 22, 1842. 134 

1842. An Act respecting receivers appointed h/ 
the iank commission&rs, under the act 
entitled " An Act respecting the appovnt- 
ment of receivers of moneyed institutions'^ 
passed April 27, 1841. 

Passed April 11, 1842. 135 

1842. An Act to amend the lam in, relation to swits 

agai/nst foreign corporations. 

Passed April 11, 1842. 247 

1843. An Act to abolish the office of bcmJc com- 

missioner, and for other purposes. 

Passed April 18, 1843. 136 

1844. Ak Acr to amend the act, passed April 18, 

1838, entitled " An Act to authorise the 
business of ianhing." 

Passed March 16, 1844. 142 

344. An Act to amend the act passed May 14, 
1840, ^^ An Act to amend the act entitled 
am, act to authorize the iusiness of ha/rik- 
ingP Passed May 6, 1844. 142 

1845. An Act relatme to pwchasers at recevvers' 

sales. Passed April 24, 1845. 144 

1845. An Act in relation to the powers of re- 
oei/vers and com/mittees of Vwnatics and 
habitual drimka/rds. 

Passed April 28, 1845. 145 

/ 



Ixx NEW YORK STATUTES. 

Date. Pa«e. 

1845. An Act vn relaUon to stocks in moneyed 
corporations held lyy the State, or iy 
liter a/ry or chwritahle i/nst/itutions. 

Passed May 13, 1845. 231 

1845. An Act to amend the la/w in relation to 
sv/lts aga/mst foreign corporations. 

Passed May 13, 1845. 249 

1847. An Act concerning the election of directors 
of lya/nking associations. 

Passed April 29, 1847. 146 

1847. An Act to a/mend an act to abolish the 
office of hank cormrdssioner, amd for 
other pwrposes, passed April 18, 1843. 

Passed Dec. 4, 1847. 146 
■ Three fifths being present. 

1847. An Act to repeal section fwe of the act 

entitled "An Act to amend an act to 
abolish the office of hank comrrvissioner, 
amd for other pv/rposes, passed Dec. 4, 
1847." Passed Dec. 13, 1847. 151 

1848. An Act a/mendatory of the act entitled, "An 

Act OMthorizing the husiness of hanking^'' 
passed April 18, 1838, a/nd the acts a/mend- 
vng the sa/me. Passed April 12, 1848. 152 

1848. An Act to amend the act embitled "An Act 

to a/mend the law in relation to suits 
against foreign corporations. 

Passed February 21, 1848. 251 

1849. An Act to OMthorize the comptroller to issue 

regist&red notes in lieu of un/registered 
ones, i/n certain cases. 

Passed March 12, 1849. 154 



NEW YORK STATUTES. Ixxi 

Date. Page. 

1849. An Act to enforce the responsibility of 
stockholders in certcmm ha/nhi/ng corpora- 
tions and associations, as prescribed by 
the constitution, and to provide for the 
■prompt pa/yments of dema/nds agcmvst such 
corporations and associations. 

Passed April 5, 1849. 155 

1849. An Act a^nendatory of the act entitled " An 
Act to authorize the business of bamJcing," 
passed April 18, 1838, a/nd the acts cmiend- 
itig the same. Passed April 10, 1849. 170 

1849. An Act to a/mend cm CKt relative to wn- 
clcmned bank dmidends cmd deposits, 
passed Man/ 9, 1835, a/nd for other pv/r- 
poses. Passed April 11, 1849. 173 

1849. An Act to extend the remedies at lam agcmist 
foreign insurance companies. 

Passed March 16, 1849. 252 



^) 



1849. An Act to designate the holidays to be 

observed in the aocepta/nce a/nd pa/yment 
of bills of excJumge a/nd promissory 
notes. Passed April 4, 1849. 259 

1850. An Act to am,end the act entitled, '•'■An Act 

to a/mend the act entitled cm act to author- 
ize the business of bcmMng," passed Ma/y 
14,1840. Passed April 10, 1850. 174 

1850. An Act to provide for a final distribwbion 
of the funds held by the compl/roller, 
belonging to the creditors of insol/oe/nt ba/nks 
amd bankers. Passed April 10, 1850. 175 

1850. An Act to prohibit corporations from inter- 
posing tlie defence of u,sury in amy action. 

Passed April 6, 1850. 264 



Ixxii NEW YORK STATUTES. 

Date, Page. 

1851, An Act to cmiend the act erdAtled;'-'- An Act 
to authorize the Jmsiness of hcmking" 
passed Mmj 26, 1841. 

Passed March 29, 1851. 177 

1851. An Act to orga/rvize a hamJc d&parl/ment. " 

Passed April 12, 1851. 178 
" Three fifths being present." 

1851. An Act to a/mend the several acts relatwig to 

incorporated ha/riks, ianking associa- 
tions, and individual 'bamkers. 

Passed April 17, 1851. 186 

1862. An Act to amend sect/ion sixteen of chapter 
nine of title two of pa/rt one of the 
Revised Statutes. Passed April 16, 1852. 191 

1852. Conawrrent resoluUon. March 4, 1852. 191 

1852. An Act to facilitate the. collection of debts 

against corporations. 

Passed March 19, 1852. 232 

1853. An Act to a/mend an act entitled "An Act 

concerning foreign ha/nh notesP 

Passed April 13, 1853. 193 

1853. An Act relating to incorporated hanks, lam,k- 

vng associations, a/nd i/ndimidual hamhers 
located a/nd doing Imsi/ness in the city of 
New York. Passed April 15, 1853. 195 

1854. An Km for the withd/rawal of the ci/rcvlat- 

ing hills of incorporated hanks, whose 
charters home expired, or ma/y hereafter 
" expire. Passed April 3, 1854. 197 



NEW YORK STATUTES. Lsxiii 

Date, Page. 

1854:. An Act direeting the copies <md certificates 
of association of banks to he transferred 
from the secreta/ry's office to the ha/nhmg 
de/pa/rtmMht. Passed April 10, 1854. 199 

1854, Ak Act a/mendatory of the act entitled ^'■An 

Act cmthorizi/ng the business of hanhmg" 
passed April 18, 1838, a/nd the acts amend- 
ing the same. Passed April 15, 1854. 200 

1855. An Act to amend the act entitled " An Act 

to enforce the responsibility of the stock- 
holders in certain banking incorporations 
and associations, as prescribed by the 
constitution, and to provide for the prompt 
payment of demam,ds against such cor- 
porations a/nd associations," passed April 
5, 1849. Passed March 15, 1855. 205 

1855. An Act repealing the act prohibitory of the 
circulation of the bills of banks not char- 
tered by the laws of thds State, under the 
denomination of fvoe dolla/rs. 

Passed March 27, 1855. 206 

1855. An Act to provide for the pwnishmemt of 
thefroMdident a/ndwnoMthorized issue and 
tra/nsf&r of the stock amd bonds of corpora- 
tions a/nd joi/nt-stock compamAes. 

Passed April 5, 1855. 207 

1857. An Act to amend the act to organize a ba/nk 
depa/rtment, passed April twelfth, eighteen 
hundred artd fifty-one, and prescribing the 
powers and duties of the superintendent. 

Passed March 14, 1857. 208a 

/* 



Ixxiv NEW YORK STATUTES. 

Date. Paffe. 

1857. An Act in relation to ianks, imiking asso- 
ciations, indi/oidual ladkers, am,d the lamk , 
depa/rtment. Passed March 28, 1857. 208o 

1857. An Act to provide for the final closi/ng of 
incorporated ianhs, continuing the busi- 
ness of hanking vm,til the expiration of 
their cha/rters. Passed April 13, 1857. 208i 

1857. An Act in relation to the assessment of 
taxes on incorporated companies. 

Passed April 15, 1857. 208A 

1857. An Act to amend the laws relative to bank- 

ing, and to prevent the improper retention 
of the notes of country banks. 

Passed April 30, 1857. 208m 

1858. An Act to restrain banks, banking institu- 

tions and individual bankers from assu/m- 
ing the title of sa/oings banks, or receiving 
deposits as such. Passed April 9, 1858. 208o 

1859. An Act in relation to the bank department. 

Passed April 11, 1859. 208j? 

1859. An Act to provide for the reduction of the 
capital stock of banking associations. 

Passed April 13, 1859. 208;; 

1859. An Act to amend ^^An Act to enforce the 
responsibility of stockholders in certain 
banking associations," passed April fifth, 
eighteen hundred and forty-nine. 

Passed April 15, 1859. 208« 

1862. An Act to authorize the incorporated banks 
of the State to take and Jwld any stock of 
the United States, or of the State of New 
York. Passed March 27, 1862. 208a7 



NEW YORK STATUTES. IxxY 

B»te. Page. 

1862. As Act to provide for the G&nsoUdation of 

hanking associations. 

Passed April 22, 1862. 208a! 

1863. An Act to a/mend am, act entitled ^'•An Act 

to autJwrize the business of ha/nhvng" 
passed April eighteen, eighteen hund/red 
and thirty-eight. Passed March 4, 1863. 2085J 

1863. An Act in relation to the taxation of man- I 

eyed corporations a/nd associations. 

Passed April 29, 1863. 208cc 

1863. An Act to amend the hanking la/ws of this 

State. . ' Passed April 29, 1863. 20Sdd 

1863. An Act to amend an act entitled "An Act 
to enforce the responsihiUly of stockholders 
in certain hanking corporations and asso- 
ciations as prescribed by the constitution, 
a/nd to provide for the prompt payment of 
demands against such corporations a/nd 
associations,^^ passed April fifth, eighteen 
hundred and forty-rm/ne. 

Passed May 2, 1863. 208ee 



Note. — The acts designated by a * in the margin of the foregoing list 
are obsolete, or have been repealed. 



TABLE OF CASES 



DIICIBED BT THE 



COURTS OF THE STATE OF KEW YORK, 



RELATING TO THE 



GENERAL BANE ACT OF 1838, AND ACTS 
AMENDATORY THEREOF. 



Names al Cases. Beporte. Pages, this ToL 

Arnold v. The Suffolk Bank. . 21 Barb., S. C. R., 424 . 330 

Assmors of ^atertown {Pec^ t.) | ^^ Hj^'^'ie*® ' ' i 804, 306 

Sank of Ama (Jtobmson v.) . 21 N. Y. Rep., 406 . . 350 

Sank of Attiea -v. Manufacturers and) nn-m v -o em o.<q 

Trader^ Sank. . . j- 20 JN. Y. Kep., 501 . 349 

Sarik Commissioners v. St. Lawrmee ( 8 Barb. S. C. R., 430 ) „„„ „oo 

Sank ■j 3 Selden, 613 \ ^^^' **''^ 

Bamk of ChUlicothe v. Do^e. . 8 Barb., S. C. R., 233 . 818 

Sank of DansvQle, In the matter of. 6 Hill, 370 . . 811 

Bank of New York (lAvingston v.) 26 Barb., S. C. R., 304 . 340 

Sank of Orleans Y. Merrill. . 2 Hill, 296 . . 306 

Bank of Sing Sing (Zeggett v.) 24 N. Y. Rep., 288 . . 365 

Bank of Watertown, People ex, rel. v. ( 25 Wend., 686 . ) 

Assessors of Watertown. . \ 1 Hill, 616 . \ °^' ^^° 

Barnes v. Ontario Bank. . 19 N. Y. Rep., 162 . 846 

Beers (Warner Y.) . . . 23 Wend., 103 . . 298 

Beers (Swift v.) . . 3 Denio, 70 . . 813 

Blatchford (Leavitt v.) . , 5 Barb., S. C. R., 9 . 315 

Blunt y.MarHn . . _ \ ^ot reported . . . 314 

^tZ^y.^: ^ ^- ^ ^""^^'^^l 2 Sand. Ch. R., 23 . 811 



Reports. 


Pages, this vol. 


23 Wend., 103 . 


298 


19 N. Y. Rep., 246 . 


. 347 


11 N. T. Eep., 507 


342 


25 N. Y. Rep., 163 . 


367 


t ;6 N. Y. Rep., 125 


340 


1 Denio, 620 i . 


312 


1 Sand. S. C. R., 693. 


99« 


24 N. Y. Rep., 548 


355 


31 Barb., S. C. R., 84 . 


. 348 


17 N. Y. Rep., 607 


342 


18 N. Y. Rep., 240 . 


. 345 


19 N. Y. Rep., 37 . 


346 


25 N. Y. Rep., 163 


. 357 


23 N; Y. Rep., 192 


3S3 



TABLE OF CASES. Ixxvii 

Names of Oases. 
Bola/nder v. Stevens. 

Bradley {International Sank v.) 

Bruee {aty Bank of Colvmbus v.) 

Buffalo GUy Bank v. Oodd. 

Butchers amd Droveri Bank (Farm- \ 
en and Medhamusi Bank of Ken 
Oo.y.) 

Campbell {OUlet y.) 

Case y. MecTumics' Bk. Assoeia&m 

Chittenango Bank {JEhle v.) . 

Church (Perkins v.) 

C% Bank of Columbus v. Bruce. 

Codd (Sacketts Harbor Bank v.) 

Codd V. BcUhhone. 

Codd (Buffalo City Bank v.) 

Cmrniir of Taxes (People v.) 

Comm'r of Taxes (People, ex rel. \ „,, -r.,!, <j p p ror orb 

HanmerBanky.) . ^ 37 Barb., S. C. R., 636 366 

Gmmtock (WHlmighlnf y.) . 3 HUl, 389 . . .308 

CrandaU ( VaXk v.) . . 1 Sand. Ch. R., 179 . 310 

CurHs y. LeamM, and Leamtt y. Curtis ) 
& Blatchford (MUlion and Mrst [• 17 Barb., S. C. R., 309 . 323 

Half Million Trust Case) . ) 

Ouyler d> Sexton y. Simdford. . 8 Barb., S. C. R., 225 319 

Dakin (Thomm y.) . . 22 Wend., 9 . . 297 

J)e Bow y. The People . . 1 Dehio, 9. . . 312 

Delafield y. Kinney. . . 24 Wend., 345. . 299 

Dodge (Bank of CMllicothe v.) . 8 Barb., S. C. R., 233 . . 318 

Dodge (MweU v.) . . 33 Barb., S. C. R., 336 . 353 

Dtd)ois (Sagory y.) . . .3 Sand. Ch. R., 466 . . 313 

JEUe y. Chittenango Bank. . 24 N. Y. Rep., 648 . 365 

Mwell V. Dodge. . . .33 Barb., S. C. R., 336 . 363 

My y. ^ague. . . 1 Qarke, Ch. R., 361 . 299 

Mcehange Bank v. Monteath. . 26 N. Y. Rep., 606 . . 369 

farmers and M!echamcs' Bank of\ 
Kent Co., Md., y. the Butchers <fc {• 16 N. Y. Rep., 126 . 340 



■i\. 



Drover^ Bank. 

^"Zdy f ""'^ "f^'"^'' ^''- (^'"•- [ 26 Barb., S. 0. R., 668 . 341 

^"B^f yf"^ "■^ ^^' ^^ ^^°' \ 26 I^- Y. Eep., 460 . 368 



Ixxviii 



TABLE OF CASES. 



Names of Cases. 
Oifford V. lAvingsUm. 

&Uletv. Camjobell. 

CHlletv. Moody. 

Gillet V. PMUpi. 
Griffin {Leavitt v.) 



Reports. Pages, this vol. 

2 Denio, 380 . . 312 

1 Denio, 520 . . 312 

j 6 Barb., S. C. E., 186 » ,„ „ 

\ 8 Comatock, 479 \ ^^*' **''" 

3 Keman, 114 . . 323, 328 
3 Sand., Oh. R., 170 {note a) 318 



Hwima (Bhmt v.) 


Not rymrted. 




1n.i 


HoUkter Bank (In matter of) 


23 N. T. Rep., 508 


. 


364 


Hunt V. Van Alstyne. . 


26 Wend., 605 




306 


Hvmt {Nwth Amer. Trust ami Sank- 
ing Co. v.) 


[ iVbi riported. 44, 


, 45, 46, 


4'7, n. 


Intematkmal Bank v. Bradley. 


19 N. Y. Rep., 245 - 




347 


Kinney (Delafield v.) 


24 Wend., 345 




299 


Zami {Seneca Go. Bank v.) . 


26 Barb., S. C. R., 695 


, 


341 


Lawrence {Palmer v.) 


1 Selden, 389 


. 


321 


LeavUty. Tylee. 


1 Sand., Ch. R., 207 




311 


leavitt V. Griffin. 


3 Sand., Ch. R., 170, (w,ni!p a) 


813 


Leavitt v. Yates. 


4 Edw., Ch. R., 134 




314 


Leavitt v. Blatchford. 


5 Barb., S. C. R., 9 . 


, 


315 


Leavitt v. Blatchford {Second Half 
MiUion Trust Case) 


■ J!fbt reported in Supreme C(nirt. 


327 


Leavitt v. Palmer. 


3 Comstock, 19 




317 



Leavitt v. Blatchford, Our&s et al ) 
{Million and Mrst Half Million }■ 17 Barb., S. C. R., 309 
Trust Case) . . ) 

Leavitt v. Curtis and CurUs v. Lea- ) 
vitt {Million and Mrst Half Million 1- 1 5 N. Y. Rep., 9 
Trust Case). Original <md cross svit. ) 

"^rl: 2^;'S ^^""' ^"'-^1 '' ^- ^- ^^p-' ''' 

Leggett v. B<mk of Sing Sing. . 24 N. Y. Rep., 283 

Livingston v. The Bank of New York. 26 Barb., S. C. R., 304 

lAvingston {Gifford y.) . 2 Denio, 880 

Manufacturers and Trader^ Bank ) „„ ht -o- t. 
{Bank of Attica y.) . . ^ 20 N. Y. Rep., 601 

Martin {BUmt Y.) . . Not reported. . 

Mayor of Tray v. The Mutual Bank. 20 N. Y. Rep., 387 

McBride v. The Farmers' Bank of ) „„ -k, -^ y, . ,„ 
Salem. Ohio. . . / [ 26 N. Y. Rep., 450 

Meads v. 7%« Merchants? Bank of AU I. ok w y R ^A<^ 
bony. . . . ; ' ' 

Merrill {Bank of Orleans v.) . 2 Hill, 295 



. 331 

343 

. 355 

340 

. 312 

349 

7 note 4 
348 

. 368 

357 
. 306 



TABLE OF CASES. Ixxix 

Names of Cases. Eeports. Pages, this vol. 

Montealh (Exchange Bank v.) 26 IT. Y. Rep., 605 . . 369 

Moo,y (Omt ..) . . \l a4V,; 1«« \ 315. 320 

""tlla ^. ^""^^ ^J"' "-^i 2« Barb., S. 0. R., 668 . 341 

Mutual Bamh {Mayor of Troy y.) 20 N. Y. Rep., 38Y . 348 

N.Y.B<mkmgCo.{Bowgerardy.) 2 Sand., Ch. R., 23 . . 311 

North Americam, Trmt and SanMnq ) w t ^ i j ^, ,u ^ 

Co.v.Hma. . . "l^^ot reported. . UrAI note. 

OHver Zee <h Oo.'sBank (In matter of) 21 N.Y. 'Rep., 9 . . 349 

Oneida Bank v. Ontario Bank. 21 N. Y. Rep., 490 . 351 

Ontario Bank (Barnes v.) . 19 N. Y. Rep., 152 . . 346 

Oniario Bank (Oneida Bank v.) 21 N. Y. Rep., 490 . 351 

Falmer v. Yates. . . 3 Sand., S. C. R., 137 . 316 

JPalmer (Zeavitt y.) . . 3 Comstock, 19 . . 317 

Palmer y. Zawrence. . . 1 Selden, 389 . . 321 

Park Bank v. Wood. . . 24 N. Y. Rep., 93 . 354 



' V. Tenth Ward Bank. 3 Edw., Ch. R., 395 . 299 

Patehin v. Bitter. . . 27 Barb., S. C. R., 34 . 342 

Pell (Talma^e v.) . . . { ^ ^^^^'^^^ ^^^ J 298, 317, 321 

People V. Comm'r of Taxes, &c. 23 N. Y. Rep., 192 . . 353 

People,exrel. Hanover Bamk,x. Com r) „f,-c,„„\, a n -o cqk oec 

0/ Taxes, dbe. . . S ' ' " 

People, ex rel. Bank of Wateriown, t. ) 25 Wend., 686 ) „_ . „-- 

Assessors of Watertown. f 1 HiU, 616 ) **"*' **"' 

People V. Supervisors of Niagara. ■! ^ -mj,' g„^ [ 309, 311 

People (Be Bow v.) . . 1 Denio, 9 . . 312 

People V. Walker. . . .21 Barb., S. C. R., 630 . 328 

PerUns v. Church. . . 31 Barb., S. C. R., 84 . 348 

Phillips (Oillet\.) . . 3 Kern., 114 . .323,328 

Bathbone (Codd -v.) . . 19 N. Y. Rep., 37 . . 346 

_ . .^ D , /r „ ^\ (29 Barb., S. C. R., 369 ) „.„ „„„ 

Beeiprodty Bank (In matter of ) j 22 N Y Rep 9 C 346,362 

Bitter (Patehin v.) . . 27 Barb., S. C. R., 34 . 342 

Bobinson Y. Bank of Attica. . 21 N. Y. Rep., 406 . . 360 

Sacketts Harbor Bank v. Codd. 18 N. Y. Rep., 240 . 345 

SaffordY.Wyckoff. . . {{^,^1 ' . \ ^^^'^^^ 



Ixxx 



TABLE OF CASES. 



Names of Cases. 
S<fgory v. Ihibois. . 
Sandford (Cuyler <fc Sextm v.) 
Schermerhorn v. Talman. 
Seneca Co. Bank v. Lamb. . 
Smith V. Strong. 
Spragiie (Ely v.) . 

State of Ohio v. LeamM {See Talmage ] 
v.Rill). . . . ] 

Stevens (Bolander v.) 

iS. Lawrence Bank {Bank Corn's v.) 

Strong {Smith v.) . 
Suffolk Bank' {Arnold v. ) 
Supervisors of Niagara {7%e Peo- 



Reports. 
3 Sand., ,Ch. R., 466 

8 Barb., S. C. E., 225 

14 N. Y. Eep., 93 

26 Barb., S. C. B. 596 

2 HiU, 241 

1 Clarke, Ch. B., 351 

3 Selden, 328 

23 Wend., 103 

1 8 Barb., S. C. R., 430 
I 3Selden, &13 [ 

2 HiU, 241 

27 Barb., S. C. B., 424 



pie T.) 

V. Beers. . 

■e V. Pdl. 



T(dmage{Tracyv.) Indiana Case, 
lalman {Schermerhorn v.) 
Tenth Ward Ba/ak {Parmly v.) 
Thomas v. Dakin. 

Tract/ V. Talmagie {ImMama ease). 

Th/lee V. Yates. 

Th/lee {Leavitt v.) 

United States Trust Compamy v. 
United States Fire Insurance Co. 

Valk v. Crandcdl. 

Van Alstyrw {Ewnt v.) 

Walker {The Pecple v.) 

Warner v. Beers. 

Watertown, Assessors of {People, exrel. 
Bank of Wdertovm, v.) 

WitUyughhy v. Comstock. . 

Wood {Park Bank v.) . 

Wyckoff {Safford v.) 

Tales {7h/lee Y.) . 
Yates {Lea/oitt v.) 
Yates {Palmer v.) . 



4 Hill, 20 1 
1 HiU, 504 f 

3 Denio, 10 

( 9 Paige, Ch. R., 410 ) 
( 3 Selden, 328 J 

18 Barb., S. C. E., 456 

14 N. T. Eep., 93 

3 Edw., Ch. R., 395 

22 Wencl., 9 . 

( ISBarb., S.C. E., 456] 
( 14 N. Y. E6p., 163 j 

3 Barb., S. C. R., 222 

1 Sand., Ch. E., 207 

[ 18 N. Y. Rep., 199 

1 Sand., Ch. R., 179 . 

25 Wend., 605 

21 Barb;, S. C. R., 680 

28 Wend., 103 

( 25 Wend., 686 ) 
( 1 HUl, 616 . y 

3 HUl, 389 

24 N. Y. Rep., 93 

j 1 HiU, 11 ) ~~ 
1 4 HUl, 442 ) 

3 Barb., S. C. R., 222 

4Edw. Ch. R., 134 

3 Sand., 137 



Pages, this tqL 
313 
319 



341 
308 
299 

317, 321 

. 298 

i 320, 322 

308 
330 

309, 311 

313 

298, 317, 321 

327, 330 
329 
299 

. 297 

[ 327, 330 

. 315 
311 

348 

. 310 
306 
328 

. 298 

• 304, 306 

308 
. 364 

300, 309 

315 
814 
316 



GENERAL STATUTES 

APPLICABLE TO 

BANKING CORPORATIONS, 

OKGANIZED UNDER THE 



REVISED STATUTES. 

CHAP. XYIII. PAET I. TITLE II. (1 E. 8. 588.) 

ENACTED m DEC, 182'r : TOOK EFFECT JAN. 1, 1828. 
•(2 H. S. Appendix, p. 775^776, § 5.) 



TITLE II. 



OF MONEYED COEPORATIONS. (1 H. S. 588.) 
ART. I. — Regulations to prevent the insolvency of moneyed 

CORPORATIONS, AND TO SECURE THE RIGHTS OE THEIR 
CREDITORS AND STOCKHOLDERS. 

ART. II.— Regulations concerning the election of directors 

OF MONEYED CORPORATIONS. 

ART. III. — Of the construction of this Title. 



AETIOLE FIEST. 

Regulations to prevent the Insolvency of Moneyed Corporations, and 
to secure the Rights of their Creditors and Stockholders. 

Seo. 1. Restrictions and prohibitions upon moneyed corporations. 

2. Unpaid interest due, not to be calculated as profits for purpose of a 

dividend. 

3. How surplus profits to be ascertained, from which dividend is to be 

made. 

4 Amount of losses exceeding undivided profits, to be charged to cap- 
ital, <&c. 

6. When loans exceed three times amount of capital, excess to be 
called in. 

6. In what cases stock pledged to be sold and charged as reduction of 
capital. 

1 



2 GENERAL STATUTES APPLICABLE TO 

1. Conveyances of effects for use of a corporation, must be directly to it ; 
except, &c. 

8. Property of corporation worth more than |1,000 not to be conveyed 

without resolution of board. 

9. Conveyances in contemplation of insolvency, void. 

10. (fell. Penalty on directors for violating preceding sections. 
12. & 13. When directors to be charged -with knowledge of affairs of 
the corporation. 

14. When insolvencies of moneyed corporations to be deemed fifaudulent. 

15. Liability of directors, by whose acts fraudulent insolvencies occa- 

sioned. 

16. Liability of stockholders in cases of fraudulent insolvency. 
] 7. Liability, in such case, of persons who transferred stock. 

18. Construction of the term " stockholder;" 

19. Corporations to transmit to comptroller, statement of their affairs 

annually. 

20. <fe 21. Matters to be set forth in such statement. 

22. Penalty for not transmitting statement. 

23. Comptroller to enter statement in a book, which is to be open to pub- 

lic inspection. 

24. Comptroller to report to the legislature violations of the charter or 

of this Titie. 

25. Forms of statemertts to be prepared by comptroller and transmit- 

ted, ifec. 

26. Banks not to issue bills for less than one dollar. 

27. Penalty on banks and their officers for buying their own notes in cer- 

tain cases. 

28. Officers, <fec. of banks not to discount notes offered to bank and re- 

jected. 

29. Moneyed corporations not to commence business until stock is paid in. 

30. Affidavit of the fact to be made, and where filed. 

31. Charter void, if within a year after it was granted affidavit be not 

filed, (See notes 1 <fc 2.) 

EeatrictionB ^ ^- ^^ shall not be lawful for the directors of any mon- 
r,?eoTorr'eyed corporation,- 



(1) In October, 1852, the Court of Appeals, in the case of Talmage v. Pell 
(3 Selden, 828-348), hdd, — " that eveiy association organized under the act 
to authorize the business of banking, and the acts amending the same, is a 
moneyed corporation within the meaning of the statutes of this State relating 
to moneyed corporations, and is bound and affected by those statutes, except- 
ing only so far as such statutes arc inconsistent with the provisions either of 
the act to authorize the business of banking or the acts amending the same.'' 



(2) In July, 1850, the Court of Appeals, in GUlet y. Moody (3 Comstock, 
479-488), AeW, — that banking associations, organized under the general bank- 



BANKING CORPORATIONS. 3 

1. To make dividends, except from tlie surplus profits gg^^^''^^^'!' 
arising from tlie -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 with- 
out the consent of the legislature : 

3. To discount or receive any note or other evidence 
of debt, in payment of any installment actually called in 



ing law, are moneyed corporations, and as such, are within the statute " to 
prevent the insolvency of moneyed corporations, and to secure the rights of their 
creditors and stockholders." 

" In the third place," says Gakdinek, J., in Talmage v. Pell, "this asso- 
ciation, as a banking corporation, was subject to all general laws relating to 
that class of corporations, except in so far as those laws, or some of their par- 
ticular provisions, have been modified or superseded by the Act of 1838, 
under which this institution was organized, and by subsequent statutes. 
This proposition is the necessary result of the decision in The Supervisors of 
Niagara v. The People, 1 Hill, 504, and Gfillet v. Moody, in this Court. If 
banks organized under this law are subject to taxation, and to the act to pre- 
vent the insolvency of moneyed corpoi-ations, as settled by these adjudica- 
tions, no reason is perceived why they are not bound by all general laws 
relating to moneyed corporations, not in cmijlict with the, one under which 
they are created." * * * "If the legislature intended to authorize the 
creation of banking corporations, we cannot suppose thstt they designed to 
provide for a privileged class, by exempting them from restrictions imposed 
upon all others, and deemed necessary to protect the public and stockholders 
against the fraud or improvidence of the agents who controlled them." (3 Sel- 
den, 328, 340, 841, 347.) See \ R.S., 588 & 599, § S2, and tlie amendatory 
Act ofAprU 24 1829. {Laws 1829, § 1 c& § 35.) 



In Gaffney v. Colville (6 Hill, 567-580), the Supreme Court held, — that 
where a stockholder of a bank sues for a violation of the first section of the 
above Title 2, he need not join all the directors who participated in the act 
charged, but may proceed against them separately ; and it was also held, tiat a 
stockholder may sue for making a dividend out of the capital stock, instead 
of the surplus profits, though he has received a share of the divid^ndi pro- 
vided he did so without knowledge of the facts rendering ij^iflegal ; and 
also that the act complained of on the part of the directors, should be alleged 
to have been done by them, — that an allegation that they caused and pro- 
cured it to be done, or that they authorized and permitted the jashier to do 
it, is not sufficient. 



4 GENERAL STATUTES APPLICABLE TO 

and required to be paid, or with the intent of providing 
the means of making such payment : 

4. To receive or 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 their 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 satisfao 
tion of any debt due to their corporation, except as herein- 
after provided : 

7. To receive fr*m any other stock corporation, in ex- 

3 Comst. 479. ■' -"^ ' 

change 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 evidences 
of debt, issued by such other corporation : 

8. To make any loans or discounts, if the corpora- 
tion 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 : ( 3 ) 

9. To make any loans or discounts to the directors of 
such corporation, or upon paper upon which such direct- 

(3) The legislature, by an act passed April 2d, 1829 (^Zaws 1829, p. 161, 
1'72); entitled " An Act to create a fund for the benefit of the creditors of certain 
moneyed corporations, and for other purposes," modified this provision as to 
" moneyed corporations having banking powers " thereafter created in this 
State, tifl follows: 

" § 2'7. It shall not be lawful for any such moneyed corporation to issue, or 
have outstanding or in circulation, at any time, an amount of notes and bills 
loaned, or put la circulation as money, exceeding twice its capital stock then 
paid in and actually possessed ; nor shall its loans and discounts at any time 
exceed twice-and a halfbt, the amount of its capital stock so paid in and pos- ' 
sessed." See § 1 of the Act of April 2d, 1829. 



BANKING CORPORATIONS. 5 

ors, or any of them, shall be responsible, to an amount ex- 
ceeding 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 discount, shall be held 
invalid. 

§ 2. In the calculation of the profits of any moneyed cJeSu^S."^'^ 
corporation previous to a dividend, interest then unpaid, 
although due or accrued, on debts owing to the com- 
pany, shall not be included. 

§3. In order to ascertain the sui-plus profits, fronig^"''P'"*P"' 
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 af- 
fairs, and the transaction of the business of the company : 

2. The interest paid, or then due, or accrlied, on debts 
owing by the company : 

3. All losses sustained by the company ; and in the 
computation ofsuch losses, all debts owing to the company 
shall be included, which shall have remained due with- 
out 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. 

8 4. When any losses shall be sustained by any such Losses how 

o J J J to be 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 dividends 
shall thereafter be made on the shares of such stock, until 



6 GENERAL -STATUTES APPLICABLE TO 

the deficit of capital, so created, shall be made good, either 
by the recovery of the moneys charged as lost or from the 
subsequently accruing profits of the company. 

Loans when § 5. If, from the occurreuce of losses charged, or 
In- 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, without delay, 
such a portion of such loans as shall reduce their whole 
amount within the limits before prescribed. 

Proceedings § 6. If any sharos of its own capital stock shall be 

on stock by- w «/ x , 

wherd'ew' is hypothecated or pledged to any moneyed corporation, and 
ne pai .i ^^^ ^^^^ which they shall be intended to secure 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 
dividends shall thereafter be made, until the deficit so cre- 
ated, be made good from the subsequently accruing profits 
of the company. 
^oerwn^con- § 7. JSfo couveyauce, assignment, or transfer of any ef- 
rafion, "watfects, for the use, benefit, or security of any such corpora- 
tion, shall be valid in law unless it be made to the corpo- 
ration directly and by name ; but the provisions of this 
section shall not be construed to apply to a conveyance or 
assignment for the benefit of creditors, in which such cor- 
poration shall be included, or to a conveyance or assign- 



BANKING CORPORATIONS. I 

ment of the effects of a debtor under the laws of this State, 
or of any other state or country. (4) 

§ 8. No conveyance, assignment, or transfer, not au- ^o^JI^^^^^^^ 
thorized by a previous resolution of its board of directors, iotK ™ 
shall be jnade by any such corporation of any of its real 
estate, or of any of its effects, 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 or- 
dinary business, nor to payments in specie or other current 
money, or in bank bills, made by such officers ; nor shall 
it be construed to render void any conveyance, assignment, 
or transfer, in the hands of a purchaser for a valuable con- 
sideration, and without notice. ( 4 ) 

(4) The Revisers say, that the principal object sought to be attained by 
§§ 7 & 8 was — " To prevent a fraudulent application or transfer of the prop- 
erty and funds of a company (§§ 1, 8)." 3 R S. 2dM.,p. 530. See Hoyt 
v. Thompson (1 Selden, 320), Johnson y. Bush (3 Barb. Ch. R. 207), Gillet v. 
Moody (3 Comst. 479, 486), To.lm.age v. Pell (3 Selden, 328, 347, 348). See 
Oill^ V. Campbell (1 Denio, 620) ) this case questioned in Qillet y. Moody (3 
Comst. 486). 

In 1846, Assistant Vice Chancellor Sandford, in Blunt & Pruyn v. 
Hanna, and in Blunt & Pruyn y. Martin (not reported), delivered the fol- 
lowing opinion: " The Assistant Viob Chancellor. — ^The principal questions 
argued in these causes are not sufficiently raised or presented by the plead- 
ings to enable the Court to determine them. There is, however, one objec- 
tion taken in the answers, which, although in some measure formal, goes to 
complainant's whole right of action. 

" They derive their title to the mortgages in question through an as- 
signment of a large number of securities, including those executed by the 
St. Lawrence Bank to the Canal Bank of Albany, on the 31st day of 
March, 1841. 

" The answers deny that any legal or valid assignment was made of these 
mortgages respectively to the Canal Bank. It appears by the testimony, that 
on the day last mentioned, the St. Lawrence Bank bought of the Canal Bank, 
$20,000 of the five per cent. New York State Stocks, and took in payment 
the bonds of the St. Lawrence Bank, payable in certain monthly installments, 
and an assignment of the securities already referred to, to secure the pay- 
ment of the bonds. The transaction was negotiated by Mr. Van Rensselaer, 
the president of the St. Lawrence Bank. He states that the authority under 



GENERAL STATUTES APPLICABLE TO 



lb. § 9. No such conveyance, assignment or transfer, nor 

any payment made, judgment suffered, lien created, or 



which he made the purchase, and with the cashiei' executed the assignment, 
was their general power as president and cashier, and also a resolution of 
tlie board of directors, which was not produced, but whioli, I infer from 
his statement, authorized him to raise money on the securities and credit 
of the Bank. If the resolution were in truth more extensive than this, the 
complainants should have produced it. It forms a part of their title which 
the answers distinctly put in issue. 

" Such being the authority, the assignment was invalid, and transferred no 
title to the Canal Bank. 

" It has been decided repeatedly in this Court, as well as in the Supreme 
Court, that the assooiatidns brought into existence under the "Act to author- 
ize the business of Banking," passed April 18th, 1838, are corporations ; and 
that they are subject to the general provisions of law which are applicable 
to like corporations, except where the above act and subsequent legislation 
have otherwise provided. 

" In the case of David Leavitt, Receiver of the North American Trust and 
Banking Company, v. 7h/lee and others (December 4th, 1846), I decided that 
the eighth and ninth sections of the Title of the Revised Statutes relative to 
'moneyed corporations' (1 R. S. 591), were applicable to banking associa- 
tions established under the General Banking Law. Under these sections, 
the assignment of the mortgages in question to the Canal Bank, was not 
' valid in law.' 

" The fact that the Canal Bank paid value fo^ the assignment does not 
alter the case. They could not become bona fide purchasers without notice 
of the defect, because the previous resolution of the boal-d of directors, 
authorizing the transfer, was by law as necessary a part of the authority of 
the St Lawrence Bank to execute the transfer, as was the General Banking 
Law itself which brought the Bank into existence. Nor would the knowl- 
edge and consent of the directors of the St. Lawrence Bank, spoken of by 
Mr. Van Rensselaer, supply the place of the previous resolution of the 
board of directors, which the statute prescribes. It is the resolution of the 
board, placed upon its minutes, which fixes and perpetuates the responsibil- 
ity of the transaction, and which the statute designed to secure. 

" If the Canal Bank acquired no valid title to the mortgages, none enured 
to the complainants. 

" It is contended in their behalf, that the defendants have not stated that 
the Receiver of the St. Lawrence Bank, or any one else, asserts a claim to 
these securities ; and further, that the defendants have no right to litigate 
this question, or if they have such right, they must avail themselves of it 
by a cross bill, bringing forward the adverse claimants. 

" To this it may be answered, that the complainants assert a right here, 
founded on an assignment of the mortgages, which right the defendants 



BANKING CORPORATIONS. -9 

security given, by any such corporation wli^n insolvent, or 
in contemplation of insolvency, with the intent of giving 
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. (5) 



deny, and the proof shows that no such right exists. This is a perfect an- 
swer to the complainants' suit. It is just as effectual as if, on ^i traverse of 
the execution of the assignment set forth in the bill, the evidence had shown 
it to be forged. If the defendants had assumed to state who owned the 
mortgages, they would have raised an immaterial issue, upon which they 
woidd be quite likely to be misinformed, and to . fail in sustaining. They 
were not botmd to make such a statement, much less to enlarge the circle 
of the litigation by bringing in the parties in whom the title remained, in case 
the assignment were invalid. Nor is it true, that the defendants have no in- 
terest in this question. If the mortgages are valid, and they belong to the 
Receiver, and not to the complainants, a payment to the latter, under a de- 
cree in this suit, would not relieve the complainants from paying them to 
the Receiver, if he could show notice to them, which this case discloses. It 
is to be regretted, that the important points made for the defence, at the 
hearing upon the merits, cannot be disposed of without further litigation ; 
but I have no alternative, and the bills must be dismissed with costs." 
Oeorge S. M. Lynch, Assistant Vice OhanceUor's Clerk : J. Blunt and John 
Dhek for complainants, and A, 0. Bkown for defendants. 

(5) The Hevisers say, that the principal object sought to be attained by 
§ 9 was, — "In the event of insolvency, to secure an equal distribution of the 
effects of a company, amongst all its creditors" (3 JH. S., 2d Ed. 530). See 
Brovmer v. Harbeck, decided by the Court of Appeals, in March, 1854. ' In 
delivering the opinion of the Court of Appeals in this case, Allen (W. F.), 
J., said: "The legislature, in aU the provisions of the Act cited (1 R. S., 
591, § 9), recognize and seek to carry out the doctrine that, among creditors, 
'Mquality is Equity' — and a prominent object is to prevent all intentional 
preference among the creditors of insolvent moneyed corporations. The 
ninth section is incorporated in the statute for that purpose, and has only to 
do with acts in derogation of the equitable doctrine of equality, and there- 
fore forbids all transfers, payments, Ac, by the corporation, when insolvent 



10 GENERAL STATUTES APPLICABLE TO 

di™°oi%to° § ^^- Eve»y director who shall violate, or be concerned 
i^gSS*' in violating, any provision in the preceding sections of this 
Article contained, shall be liable personally to the cred- 
itors and stockholders respectively, of the corporation of 
which he shall be a director, to the full extent of any loss 
- they may respectively sustain from such violation, 
lb. § 11. lHvery dvrector guilty of such violation, whether 

a loss shall or shall not result, shall ie deemed guilty 
of a misdemeanor, pu/nishaHle Iry fine, or imprisonment, 
or ioth, in the discretion of the couH by which he shall 
he tried. [Repealed : see note 6.] 
whenciarge- § 12. Evcry director shall ie deemed to possess such a 

able for such 

violation. Tcnowlcdgc of the affair's of his corpor<Mion, as to enable 
him to determine whether atvy act, proceeding, or omission, 
of its directors, is a violation of the foregoing provisions 

or in contemplation of insolvency, with intent to give a preference to any 
particular creditor over others." 

" So long as insolvency neither exists nor is contemplated, the corpora- 
. tion, like an individual, can appropriate its means to the payment of its 
debts, in such order and in such amounts and proportions as the directors 
please. But upon insolvency, either actual or contemplatedj this power 
ceases, and the law declares the absolute right of every creditor to share 
pro rata in the assets of the company, and will not suffer this right to be 
defeated by any act of the corporation or its officers. Hence, the right of 
purchasers in good faith are not protected, as in cases provided for by sec- 
tion eight of the same act. Such provisions are not necessary to protect the 
rights of parties. The creditor to whom the unauthorized payment or trans- 
fer is made, is not a purchaser, — ^he parts with nothing, — ai*d upon being 
compelled to account for whatever he may have received, he stUl loses noth- 
ing which he has a right, legal or equitable, to retain. His debt revives, 
and he again becomes a creditor, and shares equally with the others in the 
property of the debtor. He receives all to which he ever had a legal right, and 
the equities coincide with the legal rights of the parties, The statute de- 
clares the transfer and payment void, in case of actual or contemplated in- 
solvency, if made with intent to give preference to creditors, in-espective of 
the knowledge of the party receiving the transfer or payment. * * * A 
corporation, like an individual, is insolvent when it is not able to pay its debts. 
Insolvency means a general inability to answer, in the course of business, the 
liabilities existing, and capable of being enforced." See Brouwer v. Harbeck 
(1 Duer, Sup. R. 114). 



BANKING CORPORATIONS. 11 

of this Article ; cmd emery ddreotor who ahall he present 
at a meeting of the directors, where such a violation shall 
happen, shall he deemed to home concwrred therei/n, unless he 
shall, at the time, cause, or in writing require, his dissent 
therefrom to he entered at la/rge in the minutes of the di- 
rectors. [Repealed: see note 6.] 

§ 13. Every director not present at a meeting where ^^■ 
such a violation shall happen, shall nevertheless he deemed 
to have concurred therein, if the facts constituting such 
violation appear on the hooks of the company, and he re- 
maim, a director of the same compa/rvyfor six months there- 
after, a/nd do ru>t within that time cause, or in writing re- 
quire, his dissent from such illegal proceedi/ng to he entered 
at large in the minutes of the directors. [Repealed : See 
note 6.] 

§ 14. Every insohiency of a moneyed corporation shall insolvency, 
he deemed fraudulent, imless its affairs shall appear, upon*"''^^'^''^^ 
investigation, to have heenfai/rly a/nd legally administered, 
and generally with the same care a/nd diligence that agents, 
receiving a compensation for their services, are hound hy 
law to observe ; a/nd it shall he incumbent on the directors 
and stochholders of every such insolvent corporation, to re- 
pel, hy proof , the presumption of fraud. [Repealed: see 
note 6.] 

§15. In every case of a fraudulent im,sol/oency, the di- Li&biutyof 

^ ^ directors in 

rectors of the insolvent company, hy whose acts or omissions '^J^^''^' 
the insolvency was, wholly or in part, occasioned, amd^^''^' 
whether then in office or- not, shall each he liable to the 
stochholders and creditors of the company, for his propor- 
tional share of their respective losses y the proportion to he 
ascertained hy dividing the whole loss amongst the whole 
nwnher of di/rectors liable for its r&imhu/rsement ; hut this 



12 GENERAL STATUTES APPLICABLE TO 

section shall not be construed to dirwmish the liability of 
dm-ectors, as before decla/red, who shall have violated or 
have been concerned in violating the Revisions of this Ar- 
ticle. [Eepealed : see note 6.] 
i-iaMittyof § 16. If the moneys remaimng due to the creditors 
fraSMen't of a corporotion whose insoVoency shall be adjudged froMd- 
ulent, after the distribution of its effects, shall not J)e col- 
lected, in whole or in part, from, the directors liable for 
thei/r reimbv/rsement, the deficiency shall be made good iy 
tlie contribution of the stooTcholders of the compcmy y the 
whole amovmjt of the deficiency shall be assessed on the 
whole number of sha/res of the capital stoch^ a/nd the sum 
necessary to be paid on each share, shall be then ascertained, 
a/nd each stockholder shall be liable for the sum, assessed on 
the nu/mbev of shares held by him, not exceedmg the nomi- 
nal amount of such sha/res in addition to the sums paid, 
or which he ma/y be liable to pay, on accownt of those 
shares. [Eepealed : see note 6.] 
■When per- § Vj . If the amoumt assessed on the sha/res of amy 

Kons who u »/ ./ a 

fCTred«OTk stockholder, wnder the provisions of the last section, shall 
tie. not be collected from such stockholder, by reason of his in- 

soVoency, or his absence from this State, the sum remaining 
due on such assessment, shall berecove/rable agcmist the per- 
son from, whom the delinquent stockholder, at amy time 
within six months previous to the insolvency of the com- 
pany, shall home receimed a transfer of the shares, or am,y 
portion of the shares then held by him ; and every person 
homing made such tramsfer, shall be liable in the same man- 
ner, am,d for the same proportion, that he would have been 
liable had he continued to hold the sha/res so transf&rred. 
[Eepealed : see note 6.] 
rf^tom""™ § ^^' ■^'^ term ^'stockholders," as used in thepreced- 



BANKING CORPOEATIONS. 13 

ing sections of this Title, from the fov/rteenth section m- ^'"from §'14. 
elusive, shall extend to emevy equitable owner of stock, ap- 
pearing on the 'books of an insoT/oent company, in the na/me 
of anotJier person, a/rtd to euery person wJio shall have ad- 
va/nced the installments, or pii/r chase-money, of a/rvy shares 
of stock standi/ng in the nams of a/ny of his children wn- 
der the age of twenty-one years / iut no person holdvrig 
stock as a/n executor or admi/nisi/rator^ or as a gua/rdia/ti or 
trustee, appointed hy a last will or testarniemt, or hy a court 
of competent authority, and no legal or equAtoible owner of 
stock, under the age of twenty-one yea/rs, shall ie individu- 
ally responsible on account of the shares so held. [Re- 
pealed : see note 6.] 

§ 19. It shall be the duty of every moneyed corporation Annual state- 

ment to be 

hereafter created, on the first day of January after its in- J™oSp"rou. 
corporation, and annually on the same day thereafter, to''" 
make out and transmit to the comptroller, in the form 
prescribed by him, a full statement of its affairs, verified 
by the oaths of its president and cashier, or treasurer or 
secretary. [See note Y.] 

§ 20. Each statement so transmitted shall contain \_see contents 

thereof. 

note 7],' — 



(6) April 2d, 1829, the legislature by an act, entitled "An Act to create 
a fund for the benefit of certain moneyed corporations, — and for otJwr purposes '' 
(Laws 1829, pp. 161, 172, § 30), enacted, that the above sections 14, 15, 16, 11, 
& 18, " so far as they provide for the personal liability of the stockholders 
of any insolvent corporation, shall not apply to any corporation subject to 
the provisions of this act ; but the directors of every corporation subject to 
this act, shall be liable to the stockholders thereof as provided in the said 
sections." But, March 8th, 1830, the Legislature, by an act entitled "An 
Act to repeal certain sections of 'Rtle Second of the Eighteenth Chapter of t!ie 
First Part of the Revised Statutes" {Laws 1830, p. 73), eepealed the above 
sections 11, 12, 13, 14, 15; 16, iTj^fe 18. But such repeal " shall not be con- 
strued to extend to or affect any existing corporation, or any officer or mem- 
ber thereof." 



14 ■ GENERAL STATUTES APPLICABLE TO 

.1. The amount of the capital stock of the corporation, 
paid in, or inTeated according to the provisions of its char- 
ter, and the amount of such stock as then possessed : 

2. The value of the real estate of the corporation, speci- 
fying what portion thereof is occupied by the company as 
necessary to the transaction of its business : 

3. The shares of stock held by such corporation, 
■whether absolutely or as collateral security, specifying 
each kind and description of stock, and the number and 
value of the shares of each : 

4. The debtp owing to the corporation, specifying such 
as are owing from other moneyed corporations, the names 
of such corporations, and the amount due from each ; and 
also specifying the amount secured by bond and mortgage 
or judgment, the amount which, according to the provi- 
sions of this Article, Ought to be included in the computa- 
tion of losses, and the total amount of such debts then col- 
lectible : 

5. The amount of debts owing by the corporation, speci- 
fying such as are payable on demand, and such as are due 
to other moneyed corporations, the names of such corpora- 
tions, and the amount due to each : 

6. The amount of the claims against the corporation not 
acknowledged by it as debts : 

7. The amount for which the corporation is bound as 
surety, or for which it may become liable on the happen- 
ing of contingent events, whether upon policies of insur- 
ance or otherwise : and, 

8. K the statement be from a corporation having lank- 
inff powers, the amount of its notes or bills then in circu- 
lation, of its loans and discount*and of specie on hand. 



BANKING CORPORATIONS. 15 

§ 21. Eacli statement subsequent to the first so trans- rurthercon- 
nodtted shall also contain [see note 71, — stetemeiS^f- 

1- j; ter the first 

1. The amount of the losses of the corporation charged, 
specifying whether charged on its capital or profits, since 
its last preceding statement, and of its dividends declared 
and made during the same period : 

2. The average amount fou each month, during the 
preceding year, of the debts due to and from the corpora- 
tion : and, 

3. If the statement be from a corporation having ianTc- 
ing. joowers, the amount on the first day of July of the 
same year of its notes or bills in circulation, of its loans 
and discounts, and of its specie on hand. 

§ 22. Every corporation that shall neglect to make out Penalty for 
and transmit the statement, required, for one month be- 
yond the period when by law it ought to be made, may be 
proceeded against and dissolved as an insolvent corpora- 
tion. [See note 7.] 

§ 23. It shall be the duty of the comptroller to enter "^^ »' 
every such statement received by him, in a book to be pro- rach^"^'-" 
vided by him for that purpose, and which shall at all times, 
during office hours, be open to public inspection. [See 
note 7.] 

§ 24. If it shall appear to the comptroller from any 
statements received by him, that the provisions of its char- 
ter, or of this Title, have been violated by any corporation, 
or that there is reason to apprehend, that any corporation 
is or will become insolvent,' it shall be his duty to report 
the facts, together with his opinion thereon, without delay, 
to the legislature. [See note 7.] 

(7) The above sections 19, 20, 21, 22, 23, & 24, were so far modified by 
the Safety J^»ii-4p« of April 2d, 1829 {Laws 1829, pp. 167, 172, § 31), as to 



16 GENERAL STATUTES APPLICABLE TO 

lb. § 25. It shall be the duty of the comptroller, to pre- 

pare forms of the statements above prescribed, and tb 
transmit a copy thereof, together with such instructions as 
he may deem necessary, to every corporation "which is 
or shall be bound to furnish such statements under the 
provisions of this Title. 
on^banS."™ § 26. No coi-poration* having Icmking powers, shall 
issue for circulation any bill or promissory note of a less 
denomination than one dollar. 

jb. and on | 27. No corporatioQ having hanhmg powers, and 
none of its directors, officers, agents or servants, shall, 
directly or indirectly, purchase or be interested in the pur- 
chase of any promissory note, or other evidence of debt, 
issued by such corporation, for a less sum than shall ap- 
pear on the face thereof to be then due ; and every person 
violating the provisions of this section, shall forfeit three 
times the nominal amount of the note, or other evidence 
of debt, so purchased. 

lb. § 28. No president, director, cashier, clerk or agent, 

of any corporation having hanking powers, and no person 
in any way 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 of- 
fered 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 



require the statements therein referred to, to be made to the Bank Commis- 
sioners instead of the State Comptroller, &e. The requirements of the 26th 
section of the General Banking Lam of 1838 were substantially copied from 
the aboye sections 20 <& 21. 



BANKING COEPORATIONS. IT 

o£fence, forfeit twice the amount of the loan which he shall 
have made. 

§ 29. No moneyed corporation, to which a charter shall Affidavits 
hereafter be granted, shall commence the business fort-rsS"''*' 
which it shall be incorporated, until its president and 
cashier, or treasurer, or secretary, or its two principal offi- 
cers, by whatever name they may be described, shall have 
made and subscribed an afiBdavit, 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. 

§ 30. Every such affidavit, if made in a city, shall be How made 
made before the mayor or recorder of such city, and if 
made in a county, before the first judge of the county, or 
any master in chancery therein, and shall be filed in the 
clerk's office of the city and county, or of the county in 
which it shall be taken. 

§ 31. The charter of every such corporation shall be Penalty if 
void, if the affidavit above required, shall not be duly°° " 
made and filed within one year from the time such charter 
shall be granted. 



AETICLE SECOND. 

Regulations concerning the Election of Directors of Mon- 
eyed Corporations. (1 K. S. 695 : see Note 8.) 

Sko. 32. Inspectors of elections how chosen ; their pay. 
33. Directors to supply vacancies in office of inspector. 

(8) Apiril 29, ISi*?, the legislature passed an act, entitled "An Act con- 
cerning the election of Directors of Banking Associations" {Laws 184'?, chap. 
2 



18 GENERAL STATUTES APPLICABLE TO 

34, Officers of the corporation not to be chosen inspectors. 

35, Inspectors to take oath. 

36, Si, & 38. Qualifications of voters. 

39. Form of oath to be administered to persons offering to vote who are 

challenged. 

40. Affidavits to be attached to proxies. 

41. Oath to be administered to persona offering to vote upon proxy, if 

challenged. 

42. If challenged person refuse to take oath, his vote to be rejected. 

43. If election do not take place on day appointed, -when to be held. 

44. By-laws regulating elections, when to be made and to be published. 

45. A register of transfers and a book containing names of stock- 

holders, to be kept, &a. 

46. Penalty for refusing to allow stockholders to inspect them. 

47. Parties aggrieved by an election, may apply to supreme court for 

redress. 

48. 49; & 50. How supreme court to proceed in such applications. 

Inspectors § 32. At cverv election for directors in any moneyed 

to be chosen. 

corporation, three persons shall be chosen by the persons 
entitled to vote for directors, as inspectora at the next suc- 
ceeding election, whose duty it shall be to act as such, and 
any two of whom shall be competent to act. Each acting 
inspector shall be entitled to a reasonable compensation for 
his services, to be paid by the corporation for which he is 
chosen. 
Vacancies § ^^" '^^^ dircctors of the corporation shall supply 
howsuppUed- ^^^ vacaucy that may occur by the death or removal from 
the city or county where the corporation shall be situated, 
of any such inspector, or by his refusal to serve, or neg- 
lect to attend on the day of election. 
Disabiiit § ^^" '^^ pcrsou shall be chosen or appointed an in- 
spector of an election of directors in a corporation of 
which he 'shall be a director or of&cer. 

160, p. 154), whereby it was enacted that every banking association which 
had been or should thereafter be formed or organized \inder the general 
law, should be subject to the provisions of Article 2, Chapter 18, Part 1, of 
the Revised Statutes. But see note 9, post : and also see Talmage v. Fell (3 
Selden, 328). 



BANKING CORPORATIONS. 19 

§ 36. Every sucli inspector, before lie shall enter on ^ ^*fjj.°' '°' 
the duties of his ofiSce, shall take and subscribe the follow- 
ing oath, before any officer authorized by law to adminis- 
ter 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 abil- 
ity." 

, . ''^ho may 

§ 36. At every election of directors, the transfer books ^ote. 
of the corporation shall be produced, to test the qualifica- 
tions of the voters ; and no persons 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. 

§ 37. No person shall be admitted to vote on any what'stock. 
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. 

§38. No person shall be admitted to vote on anyso9;'2a 

■^ Vend. 692. 

shares, which shall have been transferred to him, for the 
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 elec- 
tion, upon any condition, agreement, or understanding; in 
relation to his manner of voting at such election. 

§ 39. Every person offering to vote, may be chal- ohaUenge. 
lenged by any other person authorized to vote at the 
same election ; and to every person so challenged, one of 
the inspectors shall administer the following oath : " You 
do swear (or affirm, as the case may be), that the shares 



20 GENERAL STATUTES APPLICABLE TO 

Oath. 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), and that they are not hypothecated 
or pledged to any other corporation or person whatever ; 
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 understanding, in rela- 
tion to your manner of voting at this election." [See 
note 8 5.] 
YotTnera' § ^^- "^^ pcrsou shall be permitted to vote upon the 

P"""^«- proxy of a stockholder, unless he shall produce, annexed 
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, on the shares mentioned in the proxy. 
Their oath 8 41. If auy pcison offering to vote upon a proxy shall 

if challenged. 

lae 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 mad-e no contract or agreement what- 
ever, for the purchase or transfer of the shares, or any por- 
tion of the shares, mentioned in such proxy." 

(8 6) Tlie legislature, June SOth, 1851 (Laws 1851, p. 616), enaated as 
follows : 

§ 1. It shall be lawful for any married ■woman, being a stookholder or a 
member of any bank, insurance company (other than mutual fire insurance 
companies), manufacturing company, or other institution incorporated under 
the laws of this State, to vote at any election for directors ' or trustees by 
proxy or otherwise, in such company of which she may be a stockholder or 
member. 

§ 2. This act shall take effect immediately. 



BANKING CORPORATIONS. 21 

§ 42. If any person duly challenged, shall refuse to take on'cSaiienI! 
the proper oath, his vote shall be rejected, and shall not be 
afterwards received at the same election ; if he shall take 
the oath, his vote shall be received. 

§ 43. If an election for directors in any such corpora- i??"',,^'"!' 
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 
appointed ; and on the day so notified, no persons shall be 
admitted to vote, except those who would have been enti- 
tled had the election taken place on the day when, by law, 
it ought to have been held. 

§ 44. No by-law of any such corporation, regulating certain by- 
the 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. 

§ 45. Every such corporation shall keep a book in book™'*"^ 
which the transfer of shares of its stock shall be registered; 
and another book, containing the names of its stockhold- 
ers ; which books shall at all times, during the usual hours 
of transacting business, for thirty days previous to an elec- 
tion of directors, be open to the examination of the stock- 
holders. 

§ 46. K any officer having charge of such books, shall, pe„„ityf„r 
upon the demand of a stockholder, refuse or neglect to ex- exwwtf " 
hibit and submit them to examination, he shall for each 
offence forfeit the sum of two hundred and fifty dollars. 

§ 4Y. If any person shall conceive himself aggrieved ^^^^^ ^^ 
by an election, or any proceeding concerning an election l^iOTedbf-' 



22 GENERAL STATUTES APPLICABLE TO 

geotion. 6 of directors or officers in any sucli corporation, he may 
apply to the supreme court for redress, giving a reasonable 
notice of his intended application, to the party to be 
affected thereby. 
Proceedings. § 48. It shall be the duty of the supreme court, upon 
^''- such application, to proceed forthwith in a summary way, 

to hear the proof and allegations of the parties, or other- 
wise to inquire into the causes of complaint, and thereupon 
to make such order, and grant such relief, as the circum- 
stances 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 sua 
they shall appoint. ^See note 9.] 
^b, § 49. The supreme court, if they cannot otherwise 

arrive at a satisfactory result, may order an issue between 
the parties, to be made up in such manner and form, and 
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 warranto, if the case be one in which 
that proceeding would be competent and effectual. 
iij, § 50. 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 rela- 
tion to the time and mode of pleading, the examination of 
witnesses, or the parties, the production of books and pa- 
pers, and the time and place of trial or hearing, as shall, in 
their judgment, be effectual for expediting the proceed- 
ings, saving expense to the parties, and causing a final 

(9.) The Supreme Court in the Matter of the Bank of Danmille (6 Hill, 
SYO), held, — that that Court had no authority to set aside an election of direct- 
ors by a hanking association organized under the general baooting law. But 
see this decision questioned in Oillett v. Moody, in the Covirt of Appeals (3 
Comstoek, 479, 486, 487). See also Talmage v. Pell (3 Selden, 328). 



BANKING CORPOEATIONS. 23 

determination to be had, with as little delay as the nature 
of the controversy wiU permit. 



AETIOLE THIRD. •(! i?. S. 598.) 

Of the Construction of this Title. 

Seo. 61. Meaning of the term " moneyed corporation." 
62. To what corporation this Title to apply. 

53. Meaning of term " directors." 

54. Meaning of term " effects." 

66. Meaning of term " evidence of debt." 

§51. The term "moneyed corporation," as used in "Moneyed 

, corporatioa" 

this Title, shall be construed to mean every corporation defined, 
having banking powers, or having the. power to mate 
loans upon pledges or deposits, or authorized by law to 
make insurances. 

§ 52. The provisions of this Title shall not apply to any ThisTitieto 
moneyed corporation existing on the first day of January, tSeconJora- 

tiona only. 

one thousand eight hundred and twenty-eight ; but they 
shall be construed to apply to every moneyed corporation 
created, or whose charter shall be renewed or extended, 
after thai time, unless such corporation shall be eaypressly 
exenypted from the provisions of this Title, in the act cre- 
ating, renewing, or extending such corporation. ( 10 ) 

§ 53. The term " directors," as used in this Title, shall "Directors" 

, defined. 

be construed to embrace all persons having by law, the 
direction or management of the affairs of any such corpo- 
ration, by whatever name they may be described in its 
charter, or known in law. 

(10) See Act concerning the Revised Statutes, passed December 10th, 1828 
(Laws of 1829, p. 19, § 5, p. 23, § 16). Also, see Talmage y. Pell (3 Selden, 
328); Gillett v. Moody (3 Comet. 4:19); Brouwer v. Earheck (decided by the 
Court of Appeals in March, 1854). 



24 GENERAL STATUTES APPLICABLE TO 

defi!ef" § ^*- '^^ *®^™ " effects," as used in this Title, sliall be 

construed to embrace every species of property, real and 
personal, including. things in action. 

"Evidences 8 65.. The term "evidence of debt," as so used, shall 

of delt " de- " ' ' 

be construed to embrace every written instrument or se- 
curity, for the payment of money, importing on its face the 
existence of a debt, and whether under seal or otherwise. 



fined. 



TITLE III. 

OF THE GENERAL POWEES, PRIYILEGES, AND 
LIABILITIES OF COEPORATIONS. (1 B. S. 599.) 

Sec. 1. Powers of 'corporatione, 

2. To vest in every corporation hereafter created. 

3. Corporations not to possess any additional powers, except those given 

by charter. 

4. Wo corporation to exercise tanking powers, unless expressly author- 

ized. 
6. When the stockholders may be required to pay in the balance on 
their stock. 

6. A majority of the body authorized to act for a corporation, may do 

business. 

7. If corporation do not commence business in a year, powers to cease. 

8. Every charter hereafter granted, subject to alteration by legislature. 

9. Who to settle afifairs of corporation upon its dissolution. 
10. Powers and liabilities of persons so acting. 

General § ^- Evcry Corporation, as such, has power, — 

powers. ^^ rji^ have succession by its corporate name, for the 

period limited in its charter ; and when no period is lim- 
ited, perpetually : 

2. 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. 



BANKING CORPORATIONS. 25 

4. To hold, prircliase, and convey sucli real and per- 
sonal estate, as the purposes of the corporation shall re- 
quire, not exceeding the amount limited in its charter : 

5. To appoint siich subordinate officers 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 aifairs, and for the transfer of its stock. 

§ 2. The powers enumerated in the preceding section in what cor- 

._ , poratlonB to 

shall vest in every corporation that shall hereafter be ere- vest. 
ated, although they may not be specified in its charter, or 
in the act under which it shall be incorporated. 

§ 3. In addition to the powers enumerated in the first what other 

" ^ powers to be 

section of this Title, and to those expressly given in its p^sessed. 
charter, or in the act under which it is or shall be incor- 
porated, no corporation shall possess or exercise any cor- 
porate powers, except such as shall be necessary to the 
exercise of the powers so enumerated and given. ( 11 ) 

(11) This section (§ 3), the Revisers say, "is declaratory of a principle of 
law frequently recognized by our courts, and which it is deemed useful to 
confirm by legislative authority" (3 R. S. 2d Ed. 631). 

That corporationa have only such powers as are expressly granted by the 
statute which creates them, and such as are incidentally necessary to the exer- 
cise of their express powers, — see Head <b Amory v. Providence Insurance Com- 
pany (2 Cranoh. 127) ; Dartmouth College v. Woodward{4: Wheaton, 418) ; Bank 
of the United States T. Dandridge (12' Wheaton, 68) ; Jackson Y. Zampshire (3 
Peters, 289); Beatyy. The Lessee of Knmoler (4 Peters, 152) ; The United States 
T. Arredondo (6 Peters, 738, 739) ; Charles River Bridge v. The Warren Bridge 
(11 Peters, 544); Bank of Augusta Y. Earle (13 Peters, 619); Perrine v. 
The Chesapeake and Delaware Canal Company (9 Howard, 172); The People 
V. T/ie Utica Insurance Company (15 Johnson 383) ; The Firemen's Insurance 
.Company v. My (2 Cowen, 699) ; Hodges v. ?%« City of Buffalo (2Denio, 110); 
MoCullmghy. Moss i5'Demo, 667); Talmagev. Pell {3 Helden, 328); I%e Au- 
burn and Cato Plank Road Company r. Douglass (decided by the Court of 
Appeals in April, 1864) ; Golman v. The Eastern Counties Railway Company 
(10 Beavan, 1 ; 4 Railway Cases, 524) ; East Anglian Railway Company v. The 



26 GENERAL STATUTES APPLICABLE TO 

bafwngpow- § ^- '^^ Corporation created, or to be created, and not 
erpro lie. g^pj-ggg^y incorporated for banting purposes, sball by any 
implication or construction, be deemed to possess tbe 
power of discounting bills, notes, or other evidence of 
debt, of receiving deposits, of buying gold and silver, 
bullion, or foreign coins, of buying and selling bills of ex- 
change, or of issuing bills, notes, or other evidences of 
debt, upon loan, or for circulation as money. ( 12 ) 

Mastern Omtnties Railway Company (11 Common 3eneh, 775; 7 Eog. L. <feE. 
R. 605): McGregor v. The Official Manager of the Dover and Deal Railway 
Company (1 Railway Cases, 227; 16 Eng. L. & E. R. 180); ThePenn. Del. 
and Maryland Steam. Navigation Company y. Dand/ridge (8 GilL <fe John. 248), 
and Hood v. The New York and New Haven Railroad Company (22 Conn. R. 
502). 

(12) The Supreme Court, in the case of The People v. The Manhattan Com- 
pany, held, — that the provisions of the a^bove g 4 did not apply to pre-exist- 
ing corporations unaffected by the Restraining Acts of 1804, 1813, and 1818 ; 
and also, that the implied powers of a corporation are as much beyond the 
control of subsequent legislation, as the powers expressly granted (9 Wendell 
R. 351). 

In the case of the New York Life Insurance and Trust Company v. 
Beehe (3 Selden R. 364), the Court of Appeals held, — that certificates of 
deposit, payable in twenty years, with interest at four and a half per cent 
and issued upon loan, by said New York Life Insurance and Trust Company 
were evidences of deit — and were so issued by that Company in violalion of 
its charter and of the Revised Statutes. Vol. 1, p. 600, § 4. 

The Certificate of Deposit in question in the Beebe Case, was for the sum 
of $2,260, and in the form following : — 

" New York Lite Insurance and Tedst Compant; 

Prinoipai,, $2,250. , Ceetifioate of De- 

Pekiod, 20 years. < i posrr on Intek- 

Rate of Interest, ( ignette. j- ^^^ 

4i per cent. ' » ' No. 1908. 

These may certify, that Prime, Ward & King, of New York, have depos- 
ited with the New York Life Insurance and Trust Company, the sum of 
twenty-two hundred and fifty dollars, for the peiiod of twenty years, com-, 
mencing on the 5th August, 1836, and endbg on the 5th August, 1856, and 
irredeemable for that period ; interest to be paid thereon by the said Com" 
pany half yearly, at their office in the city of New York, at the rate of 4J 
per cent, annually, to the said Prime, Ward & King, or their special attorney 
or legal representatives. At the end of the time of deposit, the said princi- 



BANKING CORPORATIONS. 27 

§ 6. "Where the whole capital of a corporation shall not ^jj^^^'^j^^j^f 
have been paid in, and the capital paid, shall be insuffi- 
cient to satisfy the claims of its creditors, each stockholder 
shall be bound to pay on each share held by him, the sum 
necessary to coniplete 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 com- 
pany. 

§ 6. "When the corporate powers of any corporation are ^"''™™' 
directed 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 trans- 
action of business ; and every decision of a majority of the 
persons duly assembled as a board, shall be valid as a cor- 
porate act. 

§ 7. If any corporation hereafter created by the leffis^rorfeiturefor 

" « -L *^ y non-user. 

lature, shall not organize and commence the transaction of 
its business within one year from the date of its incorpo- 
ration, its corporate powers shall cease. 

§ 8. The charter of every corporation, that shall hereafter o^'powct"™ 
be granted by the legislature, shall be subject to alteration, "^^^^^ ' 
suspension, and repeal, in the discretion of the legislature. 

pal sum, with the interest theu due, to he paid to the said Prime, Ward <fe 
King, or their special attorney, representatives, and assigns. This certifi- 
cate is assignable ore the books of the Company. 

In witness -whereof, the said Company have caused 
this Certificate of Trust to be attested in their 
behalf, by their President and Secretary, this 5th 
day of August, in the year one thousand eight 
hundi-ed and thirty-six 

(Signed) WM. BARD, 
(Signed) E. A. Nioholi, President. 

Secretary. 



28 GENERAL STATUTES APPLICABLE TO 

ciS^fdiffio" § ^- CTpon tte dissolution of any corporation created or 
to be created, and unless other persons shall be appointed 
by the legislature, or by some court of competent author- 
ity, the directors or managers of the affairs of such corpo- 
ration 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 dissolyed, and shall 
have full power to settle the affairs of the corporatioji, col- 
lect and pay the outstanding debts, and divide among the 
stockholders the moneys and other property that shall re- 
main after the payment of debts and necessary expenses. 

Their pow- § 10. The persons so constituted trustees, shall have 

era. _ 

authority to sue for, and recover the debts and property of 
the dissolved corporation, by the name of the trustees of 
such 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. . 



BANKING CORPORATIONS. 29 



AMENDATORY ACT OP APRIL 2nd, 1829. 

[LAWS OF 1829, CHAP. 9i, P. 167.] 

An Act to create a Fund for the benefit of certain moneyed 
Corporations, and for other pv/rposes : Passed April 2, 
1829. 

§ 1. Every moneyed corporation having banking pow- 
ers, hereafter to be created in this State, or whose charter to^ws aet 
shall be renewed or extended, shall be subject to the pro- 
visions of this act. (13) 

§ 2. Eor the purpose of creating and continuing the fund ^nnd to to 
herein established, every such corporation shall, on or be- 
fore the first day of January, in every year, pay to 
the treasurer of this State, a sum equal to one-half of one 
per cent, on the capital stock of such corporation paid in, 
after excepting therefrom such part of said capital stock 
as is held by the State, and at that rate for the time such 
corporation shall have been in operation, if less than one 
year. 

§ 3. At the time of making any such payment, the statement of 
corporation making the same, shall ca^ise to be delivered ° °° ''*' 
to the treasurer of this State, a statement, signed by the 
president and cashier of the corporation, and verified by 

(13) By this Act (see § 30, 31), some of the Genbeai, Statute Regdla- 
TtoNS enacted in 1827 (1 R.S. 588; seeajiiepp. 10-13) were modified or amend- 
ed, so far as they vere applicable to future moneyed corporations having 
hanking powers. (See § 61 and § 52, p. 23, a»<e.) No moneyed corporations, 
having banking powers, were created- in this State after the General System 
of Statute Regulations of 1827 took effect (January 1, 1828), until that 
System had been modified and amended by the above act of April 2d, 1829. 
{See note 14, post.) • 



30 GENEEAL STATUTES APPLICABLE TO 

their oath, duly made before some oificer authorized to 
administer oaths, specifying the actual amount of the capi- 
tal stock of such corporation paid in, and designating in 
such statement, the amount of said capital stock, as shall 
be owned by the State. 

Bank fond § ^" '^^ ^^^^ anniial payments shall continue to he 

made until every such moneyed incorporation shall have 
paid into the treasury three per cent, upon its capital 
stock, which shall be and remain a perpetual fund, to be 
denominated the " bank fund," and to be inviolably ap- 
propriated and applied to the payment of such portion of 
the debts, exclusive of the capital stock, of any of the said 
corporations which shall become insolvent, as shall remain 
unpaid, after applying the property and effects of such 
insolvent corporation, as hereafter provided. 

§ 5. The comptroller and treasurer of this State shall 

nndTreMu"" keep proper accounts of the said bank fund, separate and 

aocottnte. distinct from the funds of this State ; and the comptroller 
shall from time to time report to the legislature the con- 
dition thereof. 

§ 6. The said fund shall be the property of the corpo- 

be™nveB°tId'.° ratious by which the same shall be paid, in proportion to 
the amount which each of such corporations shall have 
contributed thereto ; but the comptroller shall have 
power, and it shall be his duty, from time to time, to in- 
vest the same, and all moneys belonging thereto, in the 
manner provided by law in respect to the common-school 
fund. And whenever it shall become necessary for the 
purpose of meeting any charges on the said fund, to sell 
any stocks in which such fund or any part thereof may 
have been invested, the comptroller shall have power to 
make such sale. 



BANKING CORPORATIONS. 31 

§ 7. The income arising from said fund, after deduct- income 
ing thereout the salaries of the hank commissioners herein- "lowpayabie. 
after mentioned, shall annually be paid by the comp- 
troller to the several corporations by which the said fund 
shall be created, in proportion to the amount which each 
of the said corporations shall have contributed thereto; 
but no corporation shall be entitled to any part of the 
said income, after it sball become insolvent, or shall be 
dissolved, or its charter shall expire. 

§ 8. Whenever the fund created by this act shall be paymenis in 

till ^111 (» • cases of re- 

reduced by the payment oi the debts oi an insolvent cor- fluowon of 
poration, to be made as hereinafter provided, below the 
sum as provided in the fourth section of this act, every 
moneyed corporation then existing, which shall be subject 
to this act, and every such corporation thereafter to be 
created, shall, on or before the first day of January, in 
every year thereafter, pay to the treasurer of this State, 
such sum to be designated by the comptroller, not exceed- 
ing a sum equal to one-half of one per cent, on its capital 
stock, as hereinbefore provided ; which last mentioned 
annual payment shall continue to be made by every cor- 
poration subject to the operation of this act, until the 
aforesaid fund shall be reimbursed, and made to amount 
to the sum as provided in th% fourth section ; after which, 
such annual payments shall be suspended, until it shall 
become necessary again to resort to the said fund, by 
reason of the insolvency of any such corporation, as here- • 
after provided, when the said payments shall be resumed 
in manner aforesaid ; and so on, from time to time, as oc- 
casion may require. 

§ 9. "Whenever any corporation subject to the opera- Duty of 
tion of this act, shall become insolvent, and shall be pro- ^h™ abg„j. 



32 GENERAL STATUTES APPLICABLE TO 

becomes in- ceeded against as hereinafter provided, it shall be the 

solvent. ° ^ ' 

duty of the Court of Chancery, immediately after a final 
dividend of the property and eiTects of such insolvent cor- 
poration shall have been made among the creditors there- 
of, to cause an order to be entered on its minutes, setting 
forth, — 

1. The total amount of debts against the said corpora- 
tion, ascertained and established by the said court, includ- 
ing lawful interest thereon : 

2. The net amount of moneys derived from the prop- 
erty and effects of the said corporation, and applied, 
under the direction of said court, towards the satisfaction 
of such debts : and, • 

3. The total amount of moneys then 'requisite to pay 
off and discharge the said debts. 

Eeoeivcr Such ordcr shall also direct the receiver appointed to 
take charge of the property and effects of the corporation, 
to apply to, and receive from, the comptroller of this 
State, in the manner hereinafter provided, the sum which 
shall be required to pay off and discharge the said debts. 

Datvof § 10. Upon such receiver filing with the comptroller of 

comptroller. ^^^.^ State, a copy of such order, duly certified by the 
proper officer, and countersigned by the chancellor, it 
shall be the duty of the said comptroller to draw his 
warrant on the treasurer, in favor of such receiver, for 
such sum, not exceeding the amount of the bank fund, as 
^ may have been declared by the said Court of Chancery to 
be necessary to satisfy the debts of the said corporation ; 
and the moneys paid to such receiver by such warrant, 
shall be paid out by him, under the direction of the Court 
of Chancery, to the several creditors of the corporation. 

In case of §11- If, at the time of filing with the comptroller the 



BANKING CORPORATIONS. 33 

copy of such order, the bank fund shall be insufficient to 5^^^' fJJ"^"' 
satisfy all the debts of the insolvent corporation, a sum 
sufficient to satisfy the residue of such debts as shall 
remain unpaid, shall be paid to such receiver, in the 
manner provided in the last preceding section, out 
of the first moneys that shall thereafter be paid to the 
treasurer pursuant to the eighth section of this act ; 
and the moneys so paid to such receiver, shall be paid out 
by him in the manner req^uired in the last preceding 
section. 

§ 12. The moneys so paid out of the treasury, and all Moneys paid 
other moneys required by this act to be paid out of the.**''^**- 
treasury, shall be a charge upon the bank fund hereby 
created. 

§ 13. Whenever the charter of any moneyed corporation, on eipira- 

I . . ft T • in . tionofa 

subject to the provisions 01 this act, shall expire, every "Harter. 
such corporation shall be entitled to receive its pro- 
portional share of said bank fund, which such corporation 
may have contributed thereto, after deducting thereout a 
proportional part of the charges upon the said fund, and 
which share the comptroller is hereby authorized to 
pay to said corporation. 

§ 14. !N"o creditor of any insolvent corporation shall, by interest, 
virtue of this act, receive interest upon his debt against 
such corporation, from and after the time such order is 
made as is required by the ninth section of this act ; nor 
shall such creditor be entitled to interest anterior to the 
presentation of his demand against such corporation, to 
the receiver that shall be appointed to take charge of the 
property and effects of such corporation. 

§ 15. Three persons, to be styled "the Bank Com- g^^^^^^, 
missioners of the State of 'New York," shall be a'ppointed TuaImT' 

duty. 
3 



34 GENERAL STATUTES APPLICABLE TO 

in the manner hereinafter provided ; whose duty, or the 
duty of one of whom it shall be, once at least in every four 
months, to visit every moneyed corporation upon which the 
provisions of this act shall be binding ; and thoroughly to 
inspect the affairs of the said moneyed corporations ; to ex- 
amine all the books, papers, notes, bonds and other evi- 
dences of debt of said corporations ; to compare the funds 
and property of said corporations with the statements to be 
made by them as hereinafter provided ; to ascertain the 
quantity of specie the said corporations have on hand ; and 
generally to make such other inquiries as may be necessary 
to ascertain the actual condition of the said corporations, 
and their ability to fulfill all the engagements made by 
them. 
How often § 16. It sliall bc the duty of the said commissioners, or 

visit banks . . , , 

some one of them, to visit and inspect the condition and 
affairs of any moneyed corporation, more frequently than 
once in every four months, if required so to do by any 
three of the moneyed corporations subject to the provisions 
of this act. 

To examine § ^'^- '^^ ^^^^ Commissioners, or either of them, shall 
have power to examine upon oath, all the ofiScers, servants, 
or agents of said corporations, or any other person, in re- 
lation to the affairs and condition of said corporations ; 
which oath the said commissioners, or either of them, are 
personally authorized to administer. 

To apply for § 18- If the Said commissioners shall ascertain from 

an injuiic- - . , _ , . , 

tion. such inspection and examination, or in any other manner, 

that any of said corporations are insolvent, or shall have 
violated any of the provisions of their act or acts of in- 
corporation, or of any other act binding on such corporations, 
the said commissioners shall immediately apply to the court 
of chancery, upon bill or' petition, for an injunction against 



BANKING CORPORATIONS. 35 

such corporation and its officers ; and the same proceedings 
shall in all respects be had, and the court shall possess the 
like powers upon such application, as are provided by law, 
in respect to such applications, when made by the attorney 
general, or by any creditor. 

§ 19. It shall be the duty of the said commissioners, in To reMrt to 

" •' 'the legisla- 

the month of Janiiary in each year, to report to the legis- '"^' 
lature, the manner in which they have discharged the 
duties imposed upon them ; and to accompany such report 
by such abstracts frora the reports made to them, and by 
such other statements as they may deem useful, 

§§ Twenty^ twenty-one, and twenty-two, as to the Tnanner 
of appointing hank commissioners, were repealed l>y chap. 
74:0/1837. 

§ 23. The said commissioners shall hold their offices for ^ toJioH of- 

u flee for two 

two years, but shall be at any time removable by the ''*''"'''■ 
governor for misconduct or neglect of duty. 

§ 24. Before the said commissioners shall enter upon the o** »' "f- 
execution of the duties of their office, they shall severally 
take the constitutional oath of office, before the secretary 
of state or some one of the circuit judges or judges of the 
county courts of any county ; and within ten days there- 
after shall cause such oath, certified by the officer before 
whom it was taken, to be filed in the office of the secretary 
of state. 

S 25. The said commissioners shall not disclose the sfotto<iis- 

o close namea 

names of the debtors of any moneyed corporation examined ^J'^*"""- 
by them, or any information obtained in the course of such 
examination, unless required in a court of justice, or in the 
course of some proceeding authorized by this act. 

S 26. There shall be allowed to each of said commission- Their 8«ia- 

° lies. 

ers the annual salary of fifteen hundred dollars, to be paid 
quarterly out of the bank fund. 



36 GENERAL STATUTES APPLICABLE TO 

issnes of 8 27. It shall not be lawful for any moneyed corporation 

banknotes. ° .... 

ereubdif's *° issue, or to iave outstanding or in circulation, at any 
"" ' ■ time, an amount of notes or bills loaned or put in circula- 
tion as money, exceeding twice its capital stock then paid 
in and actually possessed ; nor shall its loans and dis- 
counts at any time exceed twice and a half of the amount 
of its capital stock so paid in and possessed. [See note 3, 
p. 4, ante.] 
oorpontion § 28. If any such moneyed corporation shall violate the 
dissolved, -^g^gj. preceding section ; or shall neglect to make any annual 
payment to the treasurer of this State, required by this act, 
for the space of three months after the time when the 
same ought to have been made, and after being notified of 
such delinquency by the comptroller of this State ; or shall 
have lost one half of its capital stock paid in ; or shall 
have suspended the payment of its bills in specie for 
ninety days ; or shall refuse to allow the officers of such 
corporation to be examined upon oath by the said com- 
missioners, in relation to the affairs and condition of 
such corporation, every such corporation may be proceed- 
ed against by the said commissioners, and dissolved by 
the chancellor, as an insolvent corporation, as hereinbefore 
provided, 
fai^rstote-'" § ^^' -^'^^'■y officer, agent, or clerk of a moneyed cor- 
ment3,&o. pQi-^tion, who shall make false statements or false entries 
in the books of such corporation, or shall exhibit false 
papers with intent to deceive said commissioners as to the 
condition of such corporation, shall be deemed guilty of 
felony, and shall be subjected to imprisonment in the state 
prison, for a term not less than three, nor more than ten 
years. 
Liability of § 30. The fourtecuth, fifteenth, sixteenth, seventeenth, 

stockbolders, " 

Chap. 18 of and eighteenth sections of the second Title of the eight- 



BANKING COBPOEATIONS. 37 

eenth Chapter of the first Part of the Eevised Statutes, i k. s. modi- 

■^ 'fled. 

SO far as they provide for the personal liability of the 
stockholders of any insolvent corporation, shall not apply 
to any corporation subject to the provisions of this act ; 
but the directors of every corporation subject to this act 
shall be liable to the stockholders thereof, as provided in 
the said sections. {See note Q,p. 13, ante.] 

% 31. The nineteenth, twentieth, twenty-first, twenty-se- Ammai 

■^ ' ^ J ■> J statement 

cond, twenty -third, and twenty-fourth sections of the second f ^ ''s^^i"^^;. 



fled. 



Title of the eighteenth Chapter of the first Part of the E.e 
vised Statutes, shall be and are hereby so far modified, in 
respect to the corporations subject to this act, that the state- 
ments therein required shall be made to the bank commis- 
sioners, instead of the comptroller ; and the powers there- 
in conferred on the comptroller, shall not extend to any 
such corporation. [See note 6, p. 13, cmte.] 

§ 32. No stockholder of any moneyed corporation hav- commission- 
ers, not to be 
ing banking powers, shall be appointed a commissioner stockhoideis. 

under and by virtue of this act ; and it shall not be lawful 
for the said bank commissioners, or either of them, di- 
rectly or indirectly to purchase, or in any manner what- 
ever to be concerned in any bank stock in this State. 

§33. Every moneyed corporation subject to this act, g^j;^^^;^^^. 
shall be entitled to receive the legal interest established, ^'^^' 
or which may hereafter be established, by the laws of this 
State, on all loans by them made, or notes or bills by 
them severally discounted or received in the ordinary 
course of business ; but on all notes or bills by them dis- 
counted or received in the ordinary course of business, 
which shall be mature in sixty-three days from the time of 
such discount, the said moneyed corporation shall not take 
or receive more than at and after the rate of six per cen-i 
tum per annum, in advance. 



38 GENERAL STATUTES APPLICABLE TO 

Capital stock §34. Every moneyed corporation subject to this act, 
hereafter to be created, shall before it makes any loans or 
discounts, have all its capital actually paid in ; which pay- 
ment shall be proved, on oath, to the satisfaction of the 
bank commissioners, before any such loans or discounts 
shall be made ; and every moneyed corporation, whose char- 
ter shall be hereafter extended, shall, within one year 
after such extension takes effect, pay in all its capital, to be 
proved in like manner to said bank commissioners ; but 
every such moneyed corporation, whose charter shall be so 
hereafter extended, shall be permitted to reduce its capital 
stock to any silm not below the amount actually paid in 
at the time of the renewal of its charter ; but such corpo- 
ration shall, within one year from and after the time of 
such renewal, file with the comptroller a certificate, under 
the seal of the corporation, setting forth the sum to which 
its capital stock is to be reduced, as aforesaid ; the filing 
of which certificate shall exempt such corporation from 
the operation of this section, as to so much of its capital 
stock as shall be reduced in the manner above stated. 
The issne of § 35. No moneyed corporation subject to the provisions 
prohibited, ^f {-iijg ^ct, shall issue any bill or note of the said corpora- 
tion, unless the same shall be made payable on demand, 
and without interest. (14) 

(14) By § 1 of this Act, it is enacted, itat " every moneyed corporation 
having banking powers, hereafter to be created in this State, or whose char- 
ter shall be renewed or extended, shMl be subject to the provisions of this Act." 
The Act is entitled, " An Act to create a fund for the benefit of certain 
moneyed Corporations, — and for other purposes." 

By §52 (p. 23, ante) of the General Code of Statute Regulations, amended 
by this act of April 2d, 1829, it is declared, that " the provisions of this 
Title shall be construed to apply to every moneyed corporation created" after 
January 1, 1828, "unless such corporation shall be expressly exempted (rom the 
provisions of this Title, in the act creating, renewing, or extending such 
corporation." (1 R. S. 599, § 52.) 

In October, 1852, the Court of Appeals, in the case of Talmage v. Pell, 



BANKING CORPORATIONS. 39 



RESTRAINING ACT OF 1830. 

(1 Revised Statutes, pp. Yll, Y12, 713.) 



TITLE XX. 

OF UNAUTHOEIZED BA:NKmG, AND THE CIE" 
' CFLATIOlSr OF CERTAIN NOTES OR EVID- 
ENCES OF DEBT ISSUED BY BANKS. 

§ 1. No person unauthorized by law shall subscribe to, AasociaMons 

or J f„r certain 

or become a member of, or , be in any way interested in, p™''jpf,,^,"^". 
any association, institution, or company, formed, or to be aotofj!'ob.4, 



hdd : — " That every association organized under the act to authorize the 
business of banking, and the acts amending the same, is a moneyed corpor- 
ation within the meaning of the Statutes of this State relating to moneyed 
corporations, — and is bound and affected by those statutes — excepting only 
so far as such statutes are inconsistent with the provisions either of the act 
to authorize the business of banking, or of the acts amending the same ;" — and 
also held, — " That such associations are banking corporations, and possess only 
authority to carry on the business of banking in the manner and with the 
powers specified in the said act;" (3 Selden, 328, 347, 348.) 

The Safety Fund Banks have, among their express powers, the general 
unrestricted express power to carry on the business of banking, " by issuing 
bills, notes, and other evidences of debt ;" — yet, these banks were expressly pro- 
hibited by the above § 35 from issuing any bill or note payable on time, — or 
payable with interest. {See Safety Fund Charters, § 3 or § 4.) 

This general express power " to issue bills, notes, and evidences of debt," 
is not granted to banking corporations formed under the General Bank Act 
of 1838. {Laws 1838, p. 249, § 18.) But these corporations are authorized 
to loan and circulate, as money, countersigned promissory notes (" received 
from the Comptroller ";)aya6'e on demand), " according to the ordihai-y course 
of banking business, as regulated by the laws and usages of this State." 
{Laws 1838, p. 246, § 3.) 



40 GENERAL STATUTES APPLICABLE TO 

1887, In note formed, for the purpose of receiving deposits, making dis- 
cpunts, or issuing notes or other evidences of debt to be 
loaned or put in circulation as money ; nor shall any per- 
son unauthorized by law, subscribe 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. ( 15 ) 



There is no clause or proTision in the General Bank Act expressly 
exempting banking associations, formed under it, from the operation qf any 
of the provisions of the general code of statute regulations of 182'7, as 
amended by the act of April 2d, 1829. The provisions of this amendatory 
act relating to the creation of a " Bank Fund," are inapplicable to associa- 
tions under the general law of 1838, not because such associations are not 
" moneyed corporations having banking powers," but for the reason, that the 
issues of such associations, are placed under the direction of the State Comp- 
troller, and are secured in full by specific pledges of State stocks, Ac, with 
that officer. But it cannot be pretended that the proliibition contained in 
the above 35th section is inconsistent with any section or provision of the 
General Bank Act. Besides, the settled -policy of this State, as to the issue 
of post-notes or post-bills by banks, remained unchanged at the time of the 
passage of the General Act of April 18th, 1838. 

As to the repeal of former statutes hy implication, see Bowen v. Lease 
(6 Hill, 221). 

As to the issue of post-notes or post-bills by moneyed corporations, see 
Leavitt V. Palmer (3 Comstock, 19); Bank Commissioners v. the St. Lawrence 
Sank (3 Selden, 613); Talmage y. Fell (3 Selden, 328) ; Saffordv. Wyckoff 
(1 Hill, 11 S. C; 4 Hill, 442); Bank of Orleans v. Merrill (2 Hill, 295); 
Smith & Warner v. Strong (2 Hill, 241); Swift v. Beers (3Denio, 70); Attor- 
ney General v. Life Ins. and Trust Company (9 Paige, 471); Ontario Bank v. 
Schermerhorn (10 Paige, 109) ; Leavitt v. Yates (4 Edw. Ch. E. 134) ; TylecY. 
Yates (3 Barb., S. C. K. 222); Bank of Chillicothe y. Dodge (8 Barb., S. C. R. 
233J. 

See, also. Boot v. Godard (S McLean, 102) ; Hayden v. Savis (3 McLean, 
276) ; Root V. Wallace (4 McLean, 8) ; Davis v. The Bank of the River Raisin 
(4 McLean, 387). 

See, also, Southern Loan Company v. Morris (2 Barr's Penn. R. 175) ; In 
the Matter of the Ohio Life Insurance and Trust Company (9 Ohio, 291) ; 
Lawler v. Walker (18 Ohio, 151). 

See, also, § 4 of the act of May 14, 1840, and note thereon, post. 

(15) TheReviser^ Notes on Title XX. are as follows (3 R. S., 2 ed,p. 562)- 
"§ 1 as reported; enlarged as enacted '§ 1. No person unauthorized by 
law shall subscribe to or become a member of any association, institution, or 



BANKING CORPORATIONS. 41 

§ 2. Whoever shall subscribe to or become a member Penalty. 
in. any sucli company, or interested in any such bank or 
fund, shall forfeit one thousand dollars. 

§ 3. No incorporated company, without being author- j^^gtu""" 
ized by law, shall employ any part of its effects, or be in corporations 
any way interested in any fund that shall be employed for f^^ ^ ^^''^■ 
the purpose of receiving deposits, making discounts or 
issuing notes or other evidences of debt, to be loaned, or 
put into circulation as money. [See note 16.] 

§4. Any director, br other agent or officer, of any in- Pmaity. 
corporated "company, who shall violate any provision of 
the last section, shall forfeit one thousand dollars. 

§ 5. All notes and other securities for the payment of ^ ah notes, 

" X */ ,fcc., on for- 

any money, or the delivery of any property, made or given tum!" '"""^ 
to any such association, institution, or company, that shall 

company, or in any way interested in any bank or fund, formed or created for 
the purpose of receiving deposits, making diaoonnts, or issuing notes, or 
other evidences of debt, to be loaned or put in circulation as money.'" Ori- 
ginal Note. — " 2d section of act of 1813, 2 E. L. 234. The prohibition in 
the existing law against transacting ' any other business which banks may 
transact,' is supposed to be more extensive in its terms than could have been 
contemplated. The object of the legislature doubtless was, to prohibit every 
species of banking business. That object the Revisers have endeavored to 
attain by a more precise definition of that business." 

[§§ 2, 3, same as enacted.] Original Note to § 3 : "New. It is drawn to 
remove a doubt which is supposed to exist in the construction of the present 
act." 

[§§ 4, 5, 6, same as enacted.] Original note to §6 : " 1st section of the 
act of 1818, p. 242, varied in conformity to the principles suggested in the 
note to the first section.'' 

[§§ 7, 8, 9, same as enacted.] Original note to § 9 : " § 1, 2, K. L. p. 234, 
varied as to common informers.'' 

[§§ 10, 11, 12, same as enacted.] 0W(/J7iaZno<eto §12: "Laws 1816-17, 
p. 12, omitting the restriction upon banks against issuing £uch notes, as be- 
ing a questionable exercise of power, and varying the language so as to ar- 
rive at the supposed intent of the legislature." 

[§ 13, same as enacted.] Original note: "The acts of 1813 and 1818 
require the suits to be brought by the Attorney General. It is believed 
that the duties of that office are so numerous that the district attorneys will 
be more likely to attend to the collection of these penalties." 



42 GENERAL STATUTES APPLICABLE TO 

be formed for the purpose expressed in the first section of 
this Title, or made or given to secure the payment of any 
mone}'' loaned or discounted by any incorporated company, 
or its officers, contrary to the provisions of the third sec- 
tion of this Title, shall be void. 
Persons and 8 6. No pcrson, association of persons, or body corporate, 

corporations ox? i. 

™p^sdp except such bodies corporate as are expressly authorized 
?y?a«>,not by law, shall keep any office for the purpose of receiving 
te'slS deposits, or discounting notes or bills, or issuing any evi- 
note 18, ™<Hi«. deuces of debt, to be loaned, or put in circulation as 
money ; nor shall they issue any bills or promissory notes 
or other evidences of debt as private bankers, for the pur- 
pose of loaning them, or putting them in circulation as 
money, unless thereto specially authorized by law. [See 
note 16.] 

(16) In the case of Warner v. Beers (23 "Wendell; 115, 158, 159, 188), it 
was conceded by the counsel of all the parties, as wejl as by the judges, that 
the General Banking Law was simply a conditional repeal of the Restrain- 
ing Act of 1830. In other words, it only authorized associations, formed 
under it, to issue a certain kind of promissory notes for the purpose of being, 
loaned, or put in circulation as money, leaving the restraining law in full 
force as to every other evidence of debt. " Certain conditions,'' says Ver- 
planck, Senator, " are imposed to entitle them to the benefit of this condi- 
tional repeal. T/iej/ can issue no paper, unless it be secured in a certain way, 
and duly attested by the Comptroller. The very same conditions are imposed 
on every individual whp thinks fit to engage in this business." (23 Wend. 
169.) 

In Safford v. Wychoff (4 Hill, 444), the Chanoellok said, — " The act of 
1838, which only authorizes a certain kind of notes to be put in circulation 
as money, leaves the restraining law in full force as to every other etiidmce of 
debt. These banking associations, therefore, are prohibited from issuing any 
bills or promissory notes, or other evidences of debt, for the purpose of loan- 
ing them, or having them put in circulation as money, — whatever forms such 
evidences of debt_may assiune." See also the opinion of Senator Bockee to 
the same eifect, in Safford v. Wyckoff. (4 Hill, 463.) See also Leavitt v. 
Tates (4Edw. Ch. R. 134, 170, 183). 

The Chancellor, in the case of The Attorney General v. The Life andMre 
Insurance Company (4 Paige, 224; 9 Paige, 471), held, that the promissory 
notes issued by that Company (called lAfe and Fire Bonds') were illegal and 
void, that there was sufficient on the face of these bonds to show that they 



BANKISG CORPORATIONS. 



43 



§ 1. Every person and every corporation, and every Penalty. 
member of a corporation, who shall contravene either of 



-were intended as a circulating medium. The follpwing is an exact copy of one 
of the "Life and Fire Bonds :'' 



i 






— 


Vignette. 








2 


Dollars 


5000. 






No. 4655. 
















s 


THE LIFE 




AND FIEE 




— 


INSDEANCE 




COMPANY 





promise to pay Five 
order, at their office, 


Months after date, Geo. W. Gantz, or his 
Five Thousand Dollars, with interest at the 




rate of ^1^ per cent, per annum from the date hereof: interest 
payable quarterly. For the payment whereof the Company bind 
themselves and their successors, and have hereunto caused their 


o 

K 


2 


President and Secretary to subscribe their names. 


H 




New Yokk, Makoh 30th, 1829, 


_ 




J. G. Swift, Asst. Prest. 


— 


<£ 


M. L. Davis, Sec. 




iJ 
£ 




o 


(Endorsed.) 


— 


Geo. W. Gantz. 





In 1840 and 1841, 7%e North American Trust and BanMng Company (an 
association under the General Banking Law), issued 800 promissory notes, 
dated December 15th, 1840, payable 13 months after date, with interest, all 
for the sums of $1,000 or $500, called "Yates Trust Notes." Vice Ghancel- 
LOK McCons, in 1843, iaLeavitt T. Yates (4Edw., Ch. R. 134, 170, 183), held, — 
that the Restraining Act of 1830 " was applicable to all banking associations 
and individual bankers, except so far as it is modified by the provisions of 
the General Banking Law allowing the issue of bills for circulation as 
money, countersigned by the Comptroller" (pp. 170, 17 1) ; and Vice Chancellor 
McGoun also held, in that case, — that the 800 "YatesTrust Notes" had so far 
the character of circulating notes as to be within the prohibitions of the 
Restraining Act, as well as of the Act of May 14, 1840, and were therefore 
illegal, — and also, that they were void, because not based upon securities 
pledged with the Comptroller, nor intended to be counter nigned by that 
officer. The following is an exact copy of on e of the 800 " Yates Trust Notes." 



M 



GENEKAL STATUTES APPLICABLE TO 



Bank bills 
under 1 1, not 



the provisions in the last section, or, directly or indirectly, 
assent to such violation, shall forfeit one thousand dollars. 
§ 8. No person shall pay, give, or receive in payment, or 



$1,000 Dlls. No. 100. 



New Yoek, December 15 th, 1840. 
Thirteen Months after date, the NORTH AMERICAN 
TRUST & BANKING COMPANY promise to pay at their 
Banking Hmise. to the order of Mam H. Gibbs, for value received, 
the sum of ONE THOUSAND DOLLARS, with interest there- 
on at the rate of seven per centum per annum. 



Thos. G. Talmage, President. 



D. E. Tylee, Cashier. 



The payment of this obligation, with others, amounting 

in the aggregate to $600,000, is guarantied by the transfer of 
securities, estimated at $800,000, under a Deed of Tkost, exe- 
cuted between the OompaQy and Henkt Yates, Thomas G. Tal- 
MAGE, and William CuKTis Noyes, Trustees, bearing even date 
herewith. 



The Supreme Court (Justices ShanHand, Oray, and Sill), in Ti/lee v. Tales 
(3 Barb., S. C. E. 222), held, in 1848, that the "Yates Trust Notes" were ille- 
gal and Toid. 

July 10th, 1839, Washington Sunt executed his bond to The North 
American Trust and Banking Company (a corporation formed under the 
General Bank Act), in the penal sum of $"75,000, conditio^ied for the pay- 
ment of $35,000 in 11 months, with interest. An action of debt on this 
bond was brought in the Supreme Court by that Company against Hunt. 
On the 9th day of October, 1844, the cause was referred by said Supreme 
Court to the Hon. Hiram Denio, as sole Refebee to hear and determine the 
same. 

On the 3d day of July, 1846, said Referee, after hearing William Curtis 
Noyes, Esq., for' the plaintiff, and A. C. Bradley, Esq., for the defendants, 
reported that he found nothing due from the defendant to the plaintiff, and 
made his report accordingly, accompanied with an elaborate opinion. It ap- 
peared, by the admissions of the parties in this case, that the only conside- 
ration given bythe said Company io Hunt, was 35 certificates of deposit issued 
by said Company to Hunt, at the date of said bond, each for $1,000, pay- 
able 12 months after date, with interest at the rate of five per centum per 
annum j all of said certificates of deposit being in the form following : — 



BANKING CORPORATIONS. 



45 



in any way circulate, or attempt to circulate, any bank bill \^^l^^ '='''™- 
or promissory note, chock, draft, or other evidence of debt, 



NORTH 

$1000. 




AMERICAN 
No. 9. 



TRUST & BANKING COMPANY, 



NEW YOEK. 



JEfifs IS to ffievtifs, That there has been deposited with the 
NORTH AMERICAN TRUST & BANKING COMPANY, by 
Washington Hunt, the sum of One TuouaAND Dollars, which 
sum the said Company hereby engage to repay to the holder of this 
Certificate, upon the surrender thereof, iii Twelve Months from 
the date hereof, with interest at the rate of five per cent, per annum 



Waltek Mead, Cashier. 



New Yokk, July \ith, 18 



J. D. Beers, President. 



The learned Referee, in his opinion in this case (occupying 14 printed 
pages), after stating the provisions of § 3 and § 5 of the Restraining Act of 
1830, and after showing that the certificates of deposit issued to Hunt were 
promissory notes as well as evidences of debt, proceeds as follows : 

" III. Were the certificates issued to be loaned ? To make the security- 
void, the notes, or other evidences of debt, must be issued " to be loaned, or 
put in circulation as money." If the words " as money " are used only to 
qualify the words "put in circulation," then the inquiry simply is, whether 
the paper was in fact loaned ! But if the final words qualify the whole 
sentence, then they must be loaned as money. The general rule is, that 
qualifying words relate to the immediate antecedent, unless the sense of 
the whole requires a different construction. I do not see that the sense here 
requires a construction different from the grammatical one. But conceding 
that the latter construction is the true one, I think that if the certificates 
were loaned at all, they were loaned as money. The meaning of such an 
expression I take to be that they were loaned as money is loaned, or loaned 
as thougli they were money, not to be returned specifically, or in kind, or 
upon a contract that the maker shall be indemnified ; but loaned to be 
returned, dollar for dollar, as though they were actually the money which 
they profess to represent. Such was the contract here, if it was a loan. It may 
be said that it should read as though it were written, " loaned to be used as 
money.'' This would be equivalent to "putting in circulation as money," and 
would render the sentence tautological. 

" If the certificates were in truth loaned to the defendant, it will be im- 



46 GENERAL STATUTES APPLICABLE TO 

issued by any banking company within this State, or else- 
■where, which shall purport to be for the payment of a less 
sum of money than one dollar. 



possible to say that they were not.issned for that purpose. They were- 
unquestionably made and executed in reference to that transaction ; for they 
had no vitality until issued to the defendant, and are filled up with his name 
as the party to the consideration upon which they were given. 

"In a general sense, this was as much a sale as a loan; it included both. 
There is no evidence that the defendant applied for or needed a loan. All 
that I can know is, that he i-cceived the certificates, and for them gave hia 
bond with collateral security. But in the business of banking (and words 
must be used with reference to the subject matter) such a transaction is con- 
sidered a loan. One goes to a bank with his note satisfactorily endorsed, 
and receives an equal amount of the notes of the bank. This is called a 
loan. He is not expected to return the same or similar notes, or any notes. 
His engagement is to return an amount of money equal to the face of the 
notes which he receives, with the interest, imless that is paid in advance. 
This is what the defendant did in this case ; and if it is not a loan, the ordi- 
nary act of procuring a note to be discounted, and receiving the avails in 
the notes of the institution which made the discount, would not be a loan 
of the notes. The legislature must be taken to have spoken with reference 
to the transactions of banking institutions, and to have used language in 
the sense in which it is employed in speaking of such transactions. My 
opinion, therefore, is, that the certificates were loaned; and as they were 
issued to be used in that very transaction, they were, no doubt, issued to 
be loaned. 

"The view which I have taken of the statute renders it necessary to dis- 
cuss the question, whether these certificates were capable of being circulated 
as money. They would certainly be a very imperfect substitute for a cir- 
culating medium, even if the makers were of undoubted responsibility. 
Their large amount, the long time they had to run, and the interest reserved, 
are all circumstances which would prevent their filling the place of money 
in ordinary transactions. Still, if issued by a perfectly sound company, and 
of undoubted, validity in a legal point of view, they would perform many of 
, the offices of money in large transactions. Treasury notes, issued by the 
general government, which in form they very much resemble, were exten- 
sively used for remittances, and in payment for commodities. They have 
certainly a more close resemblance to bank notes than the drafts which 
were held to be void in Saffordr.Wykof (1 Hill U), and Smithy. Strong 
(2 Id. 241). Those drafts were apparently made for the purpose of transfer- 
ring funds in the hands of third parties to the payee, and would not be 
available against any party without a jv'esentment for acceptance, or against 
the drawers or endorsers, without a protest for non-acceptance, or non-pay- 
ment and notice. But yet the Supreme Court held them void as being cir- 
culating notes issued contrary to the policy of the general banking law. I 



BANKING CORPORATIONS. 47 

§ 9. "Whoever shall offend against any provision of the ^^''^'y- 
last section, shall forfeit the nominal amount of the bill, 
promissory note, check, draft, or other evidence of debt so 
given, paid, received, circulated, or attempted to be cir- 

am aware that the first of these eases has been reversed by the Court for the 
Correction of Errors ; but this may have been, and probably was, upon the . 
ground that the plaintiff was a bona fide endorsee. In the other ease, the 
draft was drawn subsequently to the Act of 1840 (Statutes 1 840, p. 306, § 4), 
which forbids banking associations from issuing any bills or notes not paya- 
ble on demand, and without interest ; but the decision was placed upon the 
general ground that the draft was calculated to circulate as money. These 
cases go much farther than would be necessary, in order to hold that the 
certificates in question are circulating notes, issued contrary to the general 
banking law. , 

" Second, If these certificates would have been void, if issued under the 
circumstances stated in the stipulation, by a corporation not authorized to 
carry on the business of banking, were the plaintiffs, an institution under 
the general banking law, authorized by law to issue them ! 

" The business of banking embraces several distinct operations ; » prom- 
inent one is the issuing evidences of debt, to be loaned or put in circula- ^ 
tion as money. The eighteenth section of the banking law professes to define 
the business to be carried on by these institutions. It is not the business of 
banking generally, leaving those terms to be defined with reference to the 
general usage and practice of the country upon that subject, but that busi- 
ness in certain of its branches, with such incidental powers as may be neces- 
sary to carry it on ; and in the enumeration, the faculty of loaning or issuing 
its own engagements is not mentioned. As to every thing which is enumer- 
ated, it is clear that the restraining acts are repealed gaoatZ these institutions. 
In respect to any branch of banking business not enumerated, these acts still 
operate in their full force upon the associations, as they do upon all other 
corporations, and upon the community generally. Although the section is 
silent upon the subject of issues, other parts of the act provide for the omis- 
sion, by authorizing the issue of circulating notes of a particular oharaicter, 
the payment of which is secured by a special pledge to be made under the 
supervision of a state officer. 

" The Title of the Revised Statutes concerning the general powers, priv- 
ileges, and liabilities of corporations {Vol. \, p. 600), is applicable to these 
institutions. By § 3 it is declared, that, besides the powers enumerated in 
the first section (which are certain matters essential to the being of every 
corporation), and those expressly given by the act under which it is incorpo- 
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.' " 

Since the said Referee's report and opinion in the case of Washington 
Hunt, the Court of Appeals has decided the cases of Gitlett v. Moody, Tai- 



48 GENERAL STATUTES APPLICABLE TO 

culated, to any person who will sue for the same, in the 

name of the overseers of the poor of the town where the 

offence is committed, with their consent and tinder their 

direction, in an action to be commenced within thirty days 

after the commissioii of the offence. 

Bank bills, §10. JSTo person shall givc, pay, or receivc in payment, 

(tthMwf/i'''' °^ ^^ ^^J '^^y circulate, orattempt to circulate, any bank 

ful'money'of bill, or any promissory note, bill, check, draft, or other 

the U. 8. 

eyidence of debt, issued by any banking company what- 
ever, which shall be made payable otherwise than in law- 
ful money the United States. 
PmaUff § 11. Every person offending against any provision of 
payawe'' '''""''^^ last sectiou, shall forfeit the nominal amount or value 
than inlaw- of such bill, note, or other evidence of debt so given, paid, 

fill money of 

the U.S. 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 offence shall be conimitted, with 
their consent and under their direction, in an action to be 
commenced within sixty days after the commission of the 
offence. ( 17 ) 

mage v. Pell, and the Bank Commissioners v. TAe St. Lawrence Bank (3 
Comsfc. 479; 3 Selden, 328 and 613). 

DECISIONS OF THE COURTS UPON THE RESTRAINING ACTS. 

3 Wend. 582 ; Beach v. Mtlton Bank. 

1 Wend. 286; Pennington v. Townsend. 

1'7 Wend. lYO ; De Groot v. Van Duzer. 

20 W end. S90; The Same Case. 

25 Wend. 648 ; New Hope, Del, B. Co. v. Poughkeepsie Silk Co. 

4 Paige, 226 ; Atty. Oen. t. Life and Fire Ins. Co. 

1 Paige, 653, 654; Pratt v. Adams (Slate Bank at Mizabeth). 
9 Paige, 471 ; Atty. Oen. v. Life and Mre Ins. Co. 

3 Sand. Ch. R. 286 ; Green v. Seymour. 

4 Edw. Ch. R. 134 ; Leavitt v. Yates. 

2 Barb. Ch. R. 301 ; Taylor v. Bruen. 

(17) Whenever in the Revised Statutes, or any other statute, words im- 
porting the plural number aire used, in describing or referring to any mat- 



BANKING COEPORATIONS. 49" 

§ 12. All bills, notes, or other instruments which shall certain miis 

T . T T IT* • T declared to 

be issued by any banking company, purporting to be re- be promis- 
ceivable in payment of debts due to such company, shall 
be deemed and taken to be promissory notes for the pay- 
ment, 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 manner as if 
the same were a promissory note. 

§ 13. The penalties prescribed in this Title, where no penalties 
other provision is made, shall be recovered by suits in thest^dfor. 
name of the people of this State, to be prosecuted by the 
district attorneys of the counties respectively where the 
ofl^nces may be committed. All penalties herein pre- 
scribed, when collected, shall be paid to the county trea- 
surer of the county, for the use of the poor thereof. ( 18 ) 

ters, parties, or persons, any single matter, party or person, shall be deemed 
to be included, although distributive words may not be used ; — and when 
any subject, matter, party, or person, is described or referred to by words 
importing the singular number, or the masculine gender, several matters 
and persona, and lemales as well as males, and bodies corporate, as well as in- 
dividuals, shall be deemed to be included; and these rules of construction 
shall apply in all cases, unless it be otherwise specially provided, or unless 
there be something in the subject or context repugnant to such construc- 
tion." (2 R. 8., 118, § 11.) 

(18) AMENDMENT OF THE EESTEAINING ACT. 

{Laws 1837, Ohap. 20, p. 14.) 
An Act to repeal in part the Revised Statutes, relating to unauthorized 

banking, and the circulation of certain notes or evidences of debt issued 

by banks. Passed February 4, 183Y. 
The People of the State of New York, represented, in Senate and Assembly, do 

enact as follows : 

§ 1. So much of title twenty, chapter twenty, part first, of the Revised 
Statutes, relating to unauthorized banking, and the circulation of certain 
notes br evideneea of debt issued by banks, as prohibits a person^or associa- 
tion of persons not incorporated, from keeping offices for the purpose of 
receiving deposits, or discounting notes or bills, is hereby repealed. 
4. 



50 GENERAL STATUTES APPLICABLE TO 



OF PROCEEDINaS AGAINST CORPORATIONS, 
n EQUITY. 

CHAP. YIII. TITLE IV. PAET III. (2 E. S. 461.) 

TOOK EFFECT JAN. 1, 1830. 



AETICLE SECOND. 

Sec. 31. Authority of Chancery to reatrain -usurpation of corporate po-wers, 

32. When injunction may be issued, <fec. 

33. Jurisdiction of Chancellor over officers of corporations. 

34. Other visitatorial powers not affected by the last section. 
85. Preceding powers, (fee., how exercised. 

36. "Whien property of corporation to be sequestered. 

37. Upon final decree, distribution how to be made. 

38. Certain acts and omissions of corporations to dissolve them. 

39. When use of rights of certain corporations may be restrained. 

40. On whose application and what proof, injunction to issue. 

41. Receivers, when to be appointed, (fee. 

42. Their general powers and duties. 

43. When and how directors and stockholders may be made parties- 

44. How made parties after a decree. 

45. Jurisdiction over stockholder, <Scc., for debts of corporation. 



§ 2. This act shall not be so construed as to authorize or permit any cor- 
poration 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. 

§ 3. No incorporated bank in this State, nor any officer or director 
thereof, shall open or keep an office of deposit or discount under this act, or 
be interested or 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 provisions of this section. 

§ 4. This act shall take effect on its final passage. 



BANKING CORPORATIONS. 51 

46. Proceedings on bills filed by creditors. 

47. Decree when corporation is insolTent. 

48. Distribution of property of corporation. 

49. Wlien stockholders compelled to pay up arrears on their stock. 

50. Liabilities of directors and stockholders, how enforced. 
61. Discovery by corporations, may be compelled. 

52. "When ofiioers, stockholders, Ac, compelled to discover. 

53. Answers of officers, how far evidence. 

54. Answers in what cases only compelled. 

55. Persons compelled to answer exonerated from prosecution, <fec. 

56. When proceedings at law against coi-porations to be stayed. 

57. Corporations excepted from the provisions of this article. 

§ 31. Upon a bill being filed by the attorney general injections 

1 n 1 n 1 against cor- 

in tbe court of chancery, the chancellor shall hav'e power poratione, 
to restrain by injunction any corporation from assuming or 
exercising any franchise, liberty, or privilege, or transact- 
ing any business, not allowed by the charter of such cor- 
poration ; and in the same manner, to restrain any indi- 
viduals from exercising any corporate rights, privileges, 
or franchises not granted to them by any law of this State. 
[See note 19.] 

(19) The Revisers' note on this section is as follows: [§ 31. Same as en- 
acted.] Original Note. " The proceedings at law by quo warranto or scire 
facias are so dilatory, that much mischief will generally be done before 
judgment can be obtained, and are so expensive that a summary remedy 
seems absolutely necessary. Ch. Kent held, in 2 J. Ch. Rep. 301, that the 
court did not possess -the power proposed to be given in the preceding sec- 
tion." (3 R. S. Id, ed. 755). But see Robinson V, Smith (3 Paige, 322.) 



In the case of The Attorney General v. Wilson (1 Craig & Phil. 1 — 29). 
it was held, — that a corporation itself may institute a suit for setting aside 
transactions against it, although carried into effect in its name by members of 
the governing body ; and that that right is not affected by the Attorney Gene- 
ral having also power to call in question such transactions. In this case. Lord 
CoOTENiiAM, said, — " What the present plaintiffs, the corporation, complain of, 
is, that eertain persons members of the corporation at,a former time, fraudu- 
lently and illegally used the power and authority of the corporation to de- 
prive it of property to which it was by law entitled. Is it to be said, that 
the corporation is therefore without remedy ? It is true, that in futur», all 



Continu- 
ance. 



52 GINEEAL STATUTES APPLICABLE TO 

When is- §32. Snch iniunction maybe issued before the com- 

ing in of the answer, upon satisfactory proof that the 

defendants complained of, have usurped, exercised, or 

claimed any franchise, privilege, liberty, or corporate 

right not granted to them ; and after the coming in of the 

answer, such injunction may be continued until judgment 

at law shall have been had. 

jurisdic- 8 33. The chancellor shall have jurisdiction over direc- 

tion over offi- *^ 

cers, &c. iQpg^ managers, and other trustees and officers of corpora- 
tions, — 

sucli property being in trust for the benefit of the public, the Attoriiey 
General may assert the right of the public in an information ; but if before 
the act passed, a corporation might, in a proper case, institute a suit for the 
purpose of setting aside transactions fraudulent against it, though carried into 
eflfeot in the name of the corporation, that right cannot be affected by the 
Attorney General having also a power to complain of the transaction." * » * 
" The true way of viewing this, is to consider the members of the governing 
body of the corporation, as its agents, bound to exercise its functions for the 
purposes for which they were given, and to protect its interests and prop- 
erty ; and if such agents exercise those functions for the purposes of injur- 
ing its interests and alietiating its property, shall the corporation be estopped 
in this court from complaining, because the act done was ostensibly an act of 
the corporation ?" — * * * " I think both objections are founded upon the 
same error, namely ; that of confounding the legitimate acts of the corporation 
with unauthorized acts effected by agents or members of a corporation in 
the name of the corporation." 



A contract made by a corporation, not within the.legitiraate scope of its 
authority, is void, not only, because unauthorized, but also, because it is illegal. 
2 Revised Statutes, 462, § 1. 
2 " " 583, § 39, sub. 1, 5. 

2 " " 585, § 48. 

1 Revised Statutes, 600, § 3. 

2 Revised Statutes, 696, § 39. 

11 Common Bench, '7'75. ) East -Anglian Railway Company v. Sast. 
7 Eng. L. & E, E. 505. ) Counties Railway Company. 
1 Kailway Cases, 22'7. ) McGregor v. The Dover and Deal Railway 
16 Eng. L. A E. R. 180. ) Company {In Exchequer Chamber). 

3 Selden, 328 ; Talmage v. Pell. 

3 Selden, 513; Bank Cotmnissioners v. St. Lawrence Bank. See Notes 
20, 21, 4- 22, post, and the cases there cited. 



BANKING CORPOEA.TIONS. 53 

1. To compel them to account for their official con- to compel 

account of 

duct, in the management and disposition of the funds *„^[™''- 
and property committed to their charge : 

2. To decree and compel payment by them, to the cor- Payment 

over of mo- 

poration whom they represent, and to its creditors, of all ""y*' *°- 
sums of money, and of the value of all property which 
they may have acquired to themselves or transferred to 
others, or may have lost or wasted, by any violation of 
their duties as such trustees : 

3. To suspend any such trustee or officer from exercis- to suspend 
ing his office, whenever it shall appear that he has abused ""'' 

his trust : 

4. To remove any such trustee or officer from his to remove 
office upon proof or conviction of gross misconduct : 

5. To direct new elections to be held by the body or to direct 
board duly authorized for that purpose, to supply vacan-tions. 
cies created by such removal : 

6. In case there be no such body or board, or all the „ 

•' ' To report 

members of such board , be removed, then to report the ^ sovemor. 
same to the governor, who shall be authorized, with the 
consent of the senate, to fill such vacancies : 

7. To set aside all alienations of property made by the ^o vacate 
trustees or other officers of any corporation, contrary toations"'™" 
the provisions of law, or for purposes foreign to the lawful 
business and objects of such corporation, in cases where 

the person receiving such alienation, knew the purpose 
for which the same was made : and Isee note 20] — 

(20) A corporation in an action against it, upon a contract, is not es- 
topped from denying its competency or power to make such contract. T?ie 
Pennsylvania, Delaware, and Maryland Steam Navigation Company v. Dan- 
dridge (8 Gill. <fe John. 248-320). This ease was decided by the Maryland 
Court of Appeals, in 1836. In delivering the opinion of the Court, Dorset, J.,. 



54 GENERAL STATUTES APPLICABLE TO 

To prevent 8. To restrain and prevent any such alienation in cases 

lem. 



them 



said : " It has been urged that th e defendants, having entered into this contract, 
are estoppedirom denying their competency to have done so. To the doctrine 
o{ estoppel, applied to sxioh eases, Tve cannot yield our assent. If the corpora- 
tion is estopped from denying its power, the estoppel operates with like effect 
upon those who act with them ; and the result would be, that no matter 
how limited the design and powers of a corporation may appear in its char- 
ter, practically it is a corporation without limitation as to its powers. Such 
a doctrine, at this day, is dangerous to the interests of the community and 
at war with the modern decisions upon the subject" (8 Gill- <& John., 319, 
320.) 

In 1853, the Supreme Court of Errors of Connecticut, cited and adopted 
the case in 8 Gill & Johnson, 248, and decided the same principle, in Hood 
v. 21ie New York and Neva Haven Railroad Company (22 Conn. R. 502-512). 
In delivering the opinion of the Court in this case, Ellsworth, J., said, — 
" Should the directors of a savings bank, or of any bank, contract with 
a shipbuilder for a steamship to navigate the ocean, would this con- 
tract bind the company ? Certainly not ; because the directors hare no 
power to make it ; nor would they have more, were they to make such con- 
tracts from day to day. The legislature has absolutely marked the liiBit of 
their power, and they cannot exceed it under the charter. And if the di- 
rectors, even with all the stockholders at their side, transcend the limits of 
the charter, and make contracts foreign to their business, they only act for 
themselves. The reason is, there can be no consent of the corporation." 
* * * "Again, it is said, the defendants" (the coi-poration) "ought 
not to be permitted to call in question the acts of their agents. Why not, as 
much as other principals, whose agents transcend their authority and 
abuse their trust? ' It is replied, the directors have suffered this course of 
things for months, when they could have arrested it at once. We ask 
whose agents they were ? Certainly not of the innocent stockholders. The 
directors represent thetn, only while they act within the scope of the charter. 
The charter is the measure of their power ; and sad would it be if directors 
could trample upon this, and yet bind the stockholders as firmly as if they 
were acting within it If the directors have done wrong, let them suffer 
the consequences." * * * " GUI <& Johnson is in direct accordance with- 
what we have said. We place our judgment upon a plain principle of equity 
and law, viz., that these defendants are not bound by a contract they had 
no power to make, and are not estopped setting up this matter in defence.'' 
(22 Conn. S09-512). See also, Hodges v. Tlie City of Buffalo (2 Denio, 110), 
Halsted v. The Mayor, (be., of New York (3 Comst, 430). See also Wyman v. 
Hallowell and Augusta Bank (14 Mass. R. 58, 62, 63), Parker, Chief Jus- 
tice. See also Salem Bank v. Gloucester Bank (17 Mass. R. 1, 28, 29), Park- 
er, Chief Justice. See also, Slark v. the Highgate Archway Company {1 
Taunt. T92) ; Broughton v. The Salford Water Works (3 Barn. & Aid. 1). 
See, also, The Mast Anglian Railway Company v. Tlie Eastern Counties Rail- 
way Company (11 Common Bench, 'J'ZS ; 1 Railway Cases, 155 ; 7 Eng. L. & E. 



BANKING CORPORATIONS. 55 

where it may be threatened, or there may be good reason 
to apprehend it will be made. [jSee note 21.J 

§ 34. When any of the visitatorial powers enumerated y^^™/}™^"' 
in the last section, over any corporation, are or shall be ^®""™- 
vested, by statute, in any corporate body or public oflScer, 

R. 505). In this case, Madie, J., said, — " If the directors have no authority 
to enter into the contract, their act is not that of the company, — it is no con- 
tract as regards it. The directors are authorized to do certain things for a 
particular object; if they do acts beyond that object, though under the cor- 
porate seal, it would not be the act of the company." (1 Railway Cases, 152.) 
" Indeed it is not contended," says Jeeyis, C. J. (1 Railway Gases, 155), " that 
a company so constituted, can engage in ne'w trades, not contemplated by 
their act; but it ia said that they may embark in other undertakings, how- 
ever various, provided the object of the directors be to increase the profit of 
their own railway. This, in truth, is the same proposition in another form; 
for, if the company cannot carry on a new trade, because it is not contem- 
plated by the act, they cannot embark in other undertakings, not sanctioned 
by their act, merely because they hope the speculation may ultimately in- 
crease the profit of the shareholders. They cannot engage in any new trade 
because they are a corporation only for the purpose of making and main- 
taining the Eastern Counties Railway. What additional power do they ac- 
quire from the fact, that the undertaking may in some way benefit their 
line S * * * If the contract is illegal, as being contrary to the act of 
Parliament, it is unnecessary to consider the effect of dissenting sharehold- 
ers; for if the company is a corporation only for a limited purpose, and a 
fiontract like that under discussion is not within their authority, the assent 
of all the shareholders to such a contract, though it may make them all per- 
sonally liable to perform such contract, would not bind them in their corpo- 
rate capacity or render liable iJieir corporate funds." The case of the JUast 
Anglian Railway Company was cited and approved by the Couet of Exche- 
QUEK Chambee, in the case of McGregor v. The Dover and Deal Railway Com- 
pany (1 Railway Cases, 22"? ; 16 Eng. L. <fc E. R. 180. See note 21, and cases 
there cited. 

(21) It is now settled, by repeated decisions in England, that a court of 
chancery will, upon the application of an individual corporator or share- 
holder, interfere by injunction, to prevent the directors, or managing body of 
a corporation, from using, pledging, or applying the corporate funds in support 
of any project not pointed out in and expressly authorized by its charter, — 
and this, although such project may be assented to by a majority of the 
shareholders ; and also that acquiescence by shareholders in a project, for how- 
ever long a period, aflfords no presumption that such project is legal; and 



56 GENERAL STATUTES APPLICABLE TO 

the provisions of that section shall not be construed to 
divest or impair the powers so vested. 
Proceed- § 35. The jurisdiction conferred by the preceding 

ings to exe- , . ■ , . , . 

cutepowers. thirty-third, sectton, shall be exercised as in ordinary 
cases, on bill or petition, as the case may require, or the 
chancellor may direct, at the instance of the attorney 
general prosecuting in behalf of the people of this State, 
or at the instance of any creditor of such corporation, or 

that any application or dealing with the capital of a corporation, not dis- 
tinctly authorized by its charter, is an illegal application or dealing. 

Oohnai), T. East. Counties Railway Co., Lord Langdale, M. R. — 11 Jurist, 
74; 10 Beavan, 1 ; 4 Railway Cases, 513. 

Cohen V. Wilkinson, Lord Langdale, M. R. — 13 Jurist, 641 ; 5 Railway 
Cases, 741. 

Colien V. Wilkinson, affirmed on appeal, by Lord Chancellor Cottenham. — 
14 Jurist, 491 ; 5 Railway Cases, 759. 

Bagshawe v. The East. Union Railway Co., Vice Chancellor Wigram. — 13 
Jurist, 641; 6 Railway Cases, 152; 7 Hare, 114. 

Affirmed, on appeal, by Lord Chancellor Cottenham. — 14 Jurist, 491 ; 2 
Mac. & G., 389; 6 Railway Cases, 169. 

Salomans-v. Laing, Lord Langdale, M. R. — 14 Jurist, 279 & 471; 12 
Beavan, 352 ; 6 Railway Cases, 289. 

Munt V. Shrewsbury and Chester Railway Company, Lord Langdale. — 15' 
Jurist, 26 ; 3 Eng. L. & E. R. U4; 13 Beavan, 1. 

Beman v. Rufford, Lord Cranworth, V. C. — 15 Jurist, 914; 7 Railway 
Cases, 48 ; 6 Eng. L. & E. R., 106. 

In Munt V. The Shrewsbury and Chester Itailway Company, Lokd Lang- 
dale said, — "I think it lias been absolutely, and now unalterably, decided, — 
although I do not think the question has ever been in the House of Lords, 
but I suppose it has been unalterably decided, — certainly it has been decided 
so far as it depends upon the Co^irt of Chancery, that companies who are 
possessed of funds for objects which are distinctly defined by act of Parlia- 
ment, cannot be allowed to apply them to any other purpose whatever, how- 
ever beneficial or advantageous that purpose may appear to be to the 
company, or to theindividual members of the company." (15 tTMn'si, p. 28.) See, 
also, in 14 Jurist, p. 248, the judgment of Lord Langdale, inSalomans v. Laing. 

In Bagshawe v. The Eastern Union Railway Company (7 Hare, 129), Vice 
Chancellor Wigram said, — "No majority of the shareholders, however large, 
could sanction the misapplication of this portion of the capital. A single 
dissenting voice would fiustrate the wishes of the majority. Indeed, in 
strictness, unanimity would not make the act lawful." 



BANKING CORPORATIONS. 5T 

at the instance of any director, trustee, or other officer of 
such corporation, having a general superintendence of its 
concerns. [See note 22.] 

§ 36. "Whenever a iuda;ment at law, or a decree in . seqnestrat- 

" .JO 7 ifig C()rporate 

equity, shall be obtained against any corporation, incor- § comst^is. 

(22) The Revisers' Note to § 33 is as follows : 

Original Note ^o § 33: "The preceding section is drawn to supply what 
are conceived to be important defects in some cases, and to remove doubts 
entertained respecting the power of the Court in others. The first subdivi- 
sion is intended, in connection with § 35, to give the Court of Chancery Jh this 
State, the same power that is exercised by that court in England, in cases of 
charitable corporations, and in other cases ; the possession of which power 
is doubted by Chancellor Kent, in 2 J. C. R., 384, although alleged to be a 
part of the general jurisdiction of the Court in 2 Term Rep., 199. The 2d, 
3d, 4th, 6th, and 6tb subdivisions are consequences from the first. In many 
of our corporations, the trustees are a permanent body, who supply vacan- 
cies in their own board; and a system of abuse and malversation may be 
perpetrated by them with impunity, without some superintending power. 
If is believed, that there is no court or tribunal whose ordinary powers and 
forms of proceeding are so adequate to the exigency, or in which the author- 
ity can be so safely lodged. * This remark is justified by the history of the 
English Chancery. The 7th and 8th subdivisions are also founded upon ac- 
knowledged principles of equity. See 1 Vesey & Beam^, 226." (3 H. S-, 
2d ed, 165.) 

A Receiver of a corporation represents the rights', both of creditors and 
stockholders, and may assert their rights when affected by the fraudulent or 
illegal acts of its madaging directors; and may repudiate illegal transfers 
of corporate effects, and illegal contracts) made by the officers of an insol- 
yent corporation, in its name, and professedly on its behalf. 

3 Comst. 19 ; Leavitt, Beeeiver, v. Palmer. 

3 Comst. 479; Gillett, Receiver, v. Moody. 

3 Selden, 328 ; State of Ohio v. Leavitt, Meceiver. 

3 Selden, 513 ; Banlc Commissioners v. 8t. Lawrence Bank ; Brouwer, Re- 
ceiver, V. Sarbeck (decided by the Court of Appeals, in March, 1854). 

1 Sand. Ch. R. 207 ; Leavitt, Receiver, v. Yates. 

1 Sand. Sup. C. R. 629 ; Brouwer, Receiver, v. Hill. 

3 Sand. Sup. C. R. 521 ; Furniss v. Sherwood. 

2 Sand. Ch. R. 170, note a ; Leavitt, Receiver, v. Griffin. 

4 Denio, R. 299 ; Austen v. Daniels. 

4Edw., Ch. R. 134; Leavitt, Receiver, v. Yates. See, also, Babcock v. 
Booth (2 Hill, 186), and Doe v. Ball (U Mee. & W. 631.) 



58 GENERAL STATUTES APPLICABLE TO 

porated under the laws of this State, and an execution 
issued thereon shall have been returned unsatisfied in part 
or in the whole, upon the petition of the person obtaining 
such judgment or decree, or his representatives, the court 
of chancery may sequestrate the stock, property, things in 
action and effects of such corporation, andr may appoint a 
receiver of the same. 
DiBtribu- 8 37. Upon a final decree on any such petition, the 

tion upon de- 'J -t j j. ? 

"'""' court shall cause a just and fair distribution of the prop- 

erty* of such corporation, and of the proceeds thereof, to 
be made among the fair and honest creditors of such cor- 
poration, in proportion to their debts respectively, who 
shall be paid in the same order as provided, by this Title, 
in the case of a voluntary dissolution of a corporation. 

of\"o?porrie § ^8. Whenever any incorporated company shall have 

"^ *^' remained insolvent for one whole year ; or for one year shall 
have neglected or refused to pay aijd discharge its notes 
or other evidences of debt ; or for one year shall have sus- 
pended the owlinary and lawful business of such corpora- 
tion ; it shall be deemed to have surrendered the rights, 
privileges, and franchises granted by any act of incorpora- 
tion, or acquired under the laws of this State, and shall be 
adjudged to be dissolved. 
Proceed- § 39. Whenever any corporation having icmking 

Vl^t^orl^-pcwers, or having the power to make loans on pledges or 
' ' deposits, or authorized by law to make insurances, shall 
become insolvent 'or unable to pay its debts, or shall have 
violated any of the provisions of its act or acts of incor- 
poration, or of any other act binding on such corporation, 
the court of chancery may, by injunction, restrain such 
corporation, and its officers, from exercising any of its cor- 
porate rights, privileges, or franchises, and from collecting 



whose 
ion. 



BANKING CORPORATIONS. 59 

or receiving any debts or demands, and from paying out, 
or in any way transferring or delivering to any person any 
of the moneys, property, or effects of sucli corporation, 
until such court shall otherwise order. [See note 23.] 

§ iO. Such injunction may be issued on the application ^Jjo^ti 
of the attorney general in behalf of this State, or of any 
creditor or stockholder of such corporation, upon bill or 
petition, filed for that purpose, and upon due proof of any 
of the facts in the last section required to authorize the 
issuing of the same. 

§ 41. Upon such application being made, and in any Eeceivers 
stage of the proceedings thereupon, the court may appoint 'y'**"*- 
one or more receivers, to take charge of the property and 
effects of such corporation, and to collect, sue for, and re- 



(23) Augast 30th, 1841, the Chancellor, upon a SiW filed by George Manning 
Tracy v. The North American Trust and Banking Company (a banking asso- 
ciation formed under the general banking law), restrained by injunction said 
association and its officers " from exercising any of the rights, privileges, or 
franchises of the said association, and from paying out or otherwise transfer- 
ring or delivering to any person, body politic or corporate, any of the money, 
property, or eifeots of said association," until said Court of Chancery should 
otherwise order, — and directed the appointment of a receiver of the effects 
of said association. Tracy, the plaintiff, was both a creditor and a stock- 
holder of said association. The order for said injunction recited, that it ap- 
peared by the said Tracy bill (among other things), that said " association is 
insolvent, and unable to meet and discharge its debts as they become due and 
payable, and hath violated the provisions of the said act " [the general bank- 
ing law], " and of the acts amending the same, and the provisions of other 
laws of the State." The order made by the Chancellor in the Tracy suit was 
made under the power conferred by the above, thirty-ninth, section. 

In 1844, Assistant Vice- Chancellor Sandford, in Boisgerard v. The New 
York Banking Company (an association under the General Banking Law) 
(2 Band. Ch. B. 23), held, — that ba,nking associations under the General Bank- 
ing Law of 1838, were within the provisions of the Revised Statutes, enti- 
tled, " Of proceedings against Corporations in Equity." This case was after- 
wards affirmed upon appeal, by the Chancellor. See also, Sagory v. Dubois 
(3 Sand. Ch. R. 466); CHUett v. Moody (3 Comst. 479); and Talmage v. Pell 
(S Selden, 328). 



60 GENERAL STATUTES APPLICABLE TO 

cover the debts and demands that may be due, and the 
property that may belong to such corporation ; who shallj 
in all respects, be subject to the control of the court. 
Theirgene- § 4:3. Such receiver shall possess all the powers and 

ral powers . . ni it '• 

anddQtiai. authority conferred, and be subject to all the obligations 
and duties imposed, in Article Third of this Title, upon 
receivers appointed in case of the voluntary dissolution of 
a corporation. [See note 24-.] 

(24) In the case of the Attorney General v. The lAfe and Mre Insurance 
Company (4 Paige, 224^-226), the Chanoelloe said, — " It is the duty of Ke- 
ceivers to allow all claims against the corporation, in behalf of persons 
claiming to be debtors thereof, •which they shall be satisfied are justly due ; 
but they should not allow any claim which the claimant could not have re- 
covered against the corporation, at law or in equity, if he had sued for the 
recovery of the same. In this respect, receivers act as guardians of the 
rights of all parties interested in the fund ; and they have no right to allow a 
claim which is not a proper charge upon that fund, without the consent of 
all who are interested in having such claim rejected. If the receivera disal- 
low the claim, and referees are appointed, although the receivers may permit 
those for whose benefit the defence against the claim is made, to manage that 
defence, this must be done under the direction of the receivers, and there 
cannot be a compromise without their consent. In this case, referees were 
appointed to decide the question between the claimants and the receivers, 
whether those bond claims were due from the corporation so as to form legal 
or equitable debts. If they are not legally or equitably due, the stockhold- 
ers who have not consented to the compromise, have a right to object to the 
same ; though it probably may be binding upon the parties thereto, so far 
as it can be carried into effect without interfering with the rights of others. 
As the receivers do not state in their petition, that any evidence has been 
elicited, on the hearing before the referees, to satisfy them that these claims 
could have been recovered against the corporation if it had not become in- 
solvent, their duty to the stockholders, who have not consented that their funds 
should be used to pay those bonds, requires of the receivers that they should 
continue the defence against the claims of these bondholders, before the 
referees, so long as that defence can, in their opinion, be rendered effectual." 
(4 Paige, 226) ; see also, McEvers v. Lawrence (1 Hoffman, Ch. R. 1'72, 176). 

In Gillet, Receiver, v. Moody (3 Comst. 479), the Court of Appeals held, — 
that a receiver of an insolvent corporation, stands as the representative of 
both creditors and stockholders, and may assert their rights when affected 
by the fraudulent or illegal acts of the corporation. 

In Talmage v. Pell (S Selden, 328), the Court of Appeals held, — ithat a re- 



BANKING CORPORATIONS. 61 

§ 43. If such application be made by a creditor of any uMns 

Btockboklers, 

corporation, whose directors or stockholders are made *°' i""'"'''' 
liable by law for the payment of such debt, in any event 
or contingency, such directors or stockholders .may be 
made parties to the bill, either on the filing thereof, or in 
any subsequent stage of the proceedings, whenever it shall 
become necessary to enforce such liabiliiy. 

§44. If any creditor of a corporation desire to make ih- after a 

decree. 

such directors or stockholders parties to the suit, after a 
decree therein against the corporation, he may do so, on 
filing a supplemental bill against them, founded upon 
such decree ; and if such decree was rendered in a proceed- 
ing instituted by the attorney general, such creditor may, 
on his application, be made complainant therein, with or 
instead of the attorney general, and may, in like manner, 
make the directors and stockholders sought to be charged, 
defendants in such suit. 

§ 45. Whenever any creditor of a corporation shall BnisiBaiDst 
se^k to charge the directors, trustees, or other superintend- *°- 
ing officers of such corporation, or the stockholders there- 
of, on account of any liability created by law, he may file 
his bill for that purpose in the court of chancery, which 
shall possess jurisdiction to enforce such liability. 

§ 46. The court shall proceed thereon as in other proceed- 

, , in , '"6= thereon. 

cases, and when necessary, snail cause an, account to be 
taken of the property and debts due to and from such cor- 

ceiver of an insolvent banting corporation, was in fact a trustm for its stock- 
holders and creditors ; and that he might repudiate illegal transfers of its 
securities by its officers, and claim them as a part of its fund. 

By 2 H. S. 469, § 61, it is enacted that,' — " Such receivers shall be invest- 
ed with all the estate, real and personal, of such corporation, from the time 
of their having filed the security hereinafter required, and shall be trustees 
of such estate, for the benefit of the creditors of such corporation and of its 
stockholders." 



62 GENERAL STATUTES APPLICABLE TO 

poration, and shall appoint one or more receivers, who 
shall possess all the powers conferred, and be subject to 
all the obligations imposed on receivers, by Article third 
of this Title, 
lb If cor- § ^^- -^^^ ^^' °^ *^® coming in of the answer, or upon 

?nJoWent^&o the taking of any such account, it shall appear that such 
corporation is insc^vent, and that it has no property or ef- 
fects to satisfy such creditor, the court may proceed, with- 
out appointing any receiver, to ascertain the respective 
liabilities of such directors and stockholders, and enforce 
the same, by its decree, as in other cases. 

§ 48. Upon a final decree being made upon any such 

bSted'*'"' application to restrain a corporation, or upon any such bill 
filed against directors or stockholders, the court shall cause 
a just and fair distribution of the property of such corpo- 
ration and of the proceeds thereof, to be made among its 
fair and honest creditors, in the order and in the propor- 
tions prescribed by this Title in the case of a voluntary 
dissolution of a corporation. 

8 49. In all cases in which the directors or other 

Payinff np " 

Boribcd?^' superintending officers of a corporation, or the stockhold- 
ers thereof, shall have been made parties to a suit in which 
a decree shall be rendered, if the property of such corpo- 
ration shall be insufficient to discharge its debts, the court 
shall proceed to compel each stockholder to pay in the 
amount due and remaining unpaid on the shares of stock 
held by him, or so much thereof as shall be necessary to 
satisfy the*ebts of the company. 

coiieoiing § ^^' ■ ^^ *^® ^^^^ °^ *^® company shall still remain 
ofdirectors, unsatisfied, the court shall proceed to ascertain the respec- 
tive liabilities, of the directors or other superintending 
officers, and of the stockholders, and to decree the amount 



their officers, 



BANKING CORPORATIONS. QB 

payable by each, and enforce such decree, as in other 
cases. ' 

§ 51. Upon any application to the court of chancery, ^^^^"^^ 
in any of the cases provided in this Article, such court may "™'- 
compel such corporation to discoTer any stock, property, 
things in action, or effects, alleged to belong or to have 
belonged to it, the transfer and disposition thereof, and the 
consideration and all the circumstances of such disposition. 

§ 52. Every officer, agent, or stockholder of any cor- n,. by 
poration, against which proceedings shall be instituted, &o! 
according to the provisions of this Article, and every per- 
son to whom it shall be alleged that any transfer of any 
property or effects of such corporation, has been made, or 
in whose possession or control any such property or effects 
shall be alleged to be, may be compelled, in the discretion 
of the chancellor, to answer a bill filed to obtain any dis- 
covery in the last section specified, notwithstanding such 
answer may expose the corporation of which he is a mem- 
ber, to a forfeiture of its corporate rights, or any of them. 

§ 53. The answers of the ofiicers and agents of any how far 
corporation, shall be evidence against -the corporation in *^' ™°^' 
the same manner, and to the same extent, as if such an- 
swers had been given upon an examination of such ofl&cers 
as witnesses in the cause, and such officers may subsequent- 
ly be examined as witnesses by either party imder the or- 
der of the court. 

§ 54. But no such answer shall be compelled, unless ^^^ „„„j. 
by the special order of the chancellor, on a hearing of the ^ ^ ' 
parties, or by the consent, in writing, of the attorney- 
general. 

§ 55. Every person so answering, shall be wholly ex- . 
empted and exonerated from any indictment or other rate from 

• ' ' prosecution. 



64 GENERAL STATUTES APPLICABLE TO 

criminal prosecution, and from every action for any penalty 
or forfeiture, for any act done or omitted, the doing or omis- 
sion of wMcli shall have been so confessed by such answer. 
Staying § 56. "Whenever any bill shall be filed, or any appli-' 

at law. cation made against any corporation, its directors or other 
superintending officers, or its stockholders, according to 
the provisions of this Title, the court may, by injunction, 
on the application of either party, and at any stage of the 
proceedings, restrain all proceedings at law, by any credi- 
tor, against the defendants in such suit; and, when- 
ever it shall appear necessary or proper, may order notice 
to be published, in such manner as the court shall direct, 
requiring all the creditors of such corporation to exhibit 
their claims and become parties to the suit, within a rea- 
sonable time, not less than six months from the first publi- 
cation of such order, and in default thereof, to be preclu- 
ded from all benefit of the decree which shall be made in 
such suit, and from any distribution which shall be made 
under such decree. 

§ 5T. The provisions of this Article shall not extend 

corporalions to any incorporated library society ; to any religious cor- 

exoepted. , 

poration ; or to any Laucasterian or select school, incorpor- 
ated by the regents of the university, or by the legislature. 



ARTICLE THIRD. [2 E. S. 466.] 
Of the, Vdlvmta/ry Dissolution of Corporations. 

Seo. 58. When directors, cfeo. of corporations may apply for their dissolution. 

59. Contents of application ; statements, ifec. to accompany it. 

60. Statements to be verified by affidavit. 

61. Order to show cause, when to be entered. 

62. Notice of such order, how to be published. 

63. Master to take testimony and report to court. 



BANKING CORPORATIONS. 65 

64. Master to have original petition and scliedules. 

66. When decree for diasolving to be made; receivers, <!io. 

66. "Who may be receivers; security to be given. 

67 & 68. Rights, interest, and authority of receivers. 

69. To prosecute stockholders for arrears on their stock. 

70. Notice to be given by receivers ; its contents. 

71. Acts of corporation after presenting petition, void. 

72. Debtors to account to receivers ; their powers to discover debts, <feo. 

73. Power of receivers to refer controversies'; proceedings. 

74. Duties of receivers ; to call meetings of creditors, <kc. 

75. Subsisting contracts, how canceled. 

76. Commissions to be allowed to receivers. 

77. To retain moneys to cancel subsisting contracts. 

78. Also to meet recovery in suits pending. 

79. Order of payment of debts. 

80. Second and final dividend, when to be made, how notified. 

81. Proceedings therein ; to be final, except certain cases. 

82. Receivers not to be answerable for debts not exhibited. 

83. Surplus to be distributed among stockholders. 

84. Application of moneys retained to meet suit. 

85. Power of court of chancery over receivers. 

86. When to render account on oath to court. 

87. Notice of intent to render, when and how to be published. 

88. Duty of master to whom account is referred. 

89. Settlement of account by court, its effect; further accounts, Ac. 

90. Decrees and orders of court subject to appeal. 

91. Certain corporations excepted from this article. 

§ 58. Whenever the directors, trustees, or other offi- ■who may 

apply for dia- 

cers having the management of the concerns of any cor- ""'""""■ 
poration, or the majority of them, shall discover that the 
stock, property, and eflPects of such corporation have been 
so far reduced by losses or otherwise, that it will not.be 
able to pay all just demands to which it may be liable, or 
to afford a reasonable security to those who may deal with 
such corporation, or whenever such directors, trustees, or 
officers, or a majority of them, shall, for any reason, deem 
it beneficial to the interests of the stockholders, that such 
corporation should be dissolved, they may apply to the 
court of chancery, by petition, for a decree dissolving 
such corporation pursuant to the provisions of this Article. 
5 



Ofiocam- 
brances. 



66 GENERAL STATUTES APPLICABLE TO 

r t tsof § ^^" E'^^ry such application shall contain a state- 
*o bfanS- ment of the reasons which induce the applicants to desire 
a dissolution of the corporation, and there shall be an- 
nexed thereto,— 

Inventory !• A full, juSt, and true inventory of all the estate,- 
both real and personal, in law and equity, of such corpo- 
ration, and of all the books, vouchers, and securities relat-- 
ing thereto : 

2. A full, I'ust and true account of the capital stock 

Account of ' "^ ■*- 

itTownera"'' ^^ ^^^^ corporation, specifying the names of the stockhold- 
ers, their residence when known, the number of shares be- 
longing to each, the amount paid in upon such shares 
respectively, and the amount still due thereon : 

3. A statement of all incumbrances on the property 
of such corporation by judgment, mortgage, pledge or 
otherwise : 

4. A full and true account of all the creditors of such 

Account of 

thlfr'S-*"'' corporation and of all engagements entered into by such 
corporation, which may not have been fully satisfied 
or canceled ; specifying the place of residence of each 
creditor and of every person to whom such engagements 
were made, if known, and if not known, the fact to be so 
stated ; the sum owing to each creditor ; the nature of each 
debt or demand ; and the true cause and consideration of 
such indebtedness, in each case. 

Affldavit g 60. To every such petition, there shall also be an- 
nexed an affidavit of the applicants, that the facts stated in 
such application, and the accounts, inventories and. state- 
ments contained therein or annexed thereto, are just and 
true, so far as such applicants respectively know or have 
the means of knowing. 

Older to § 61. Upon such petition, accounts, inventories, and 

snow cause. ^ j. x / j j 

affidavit being filed, an order shall be entered requiring all 



BANKING CORPORATIONS. 67 

persons interested in sucli corporation, to show cause, if 
any they have, why such corporation should not be dissol. 
ved before some master of the court, to be named in such 
order, at some time andi place therein to be specified, not 
less than three, months from the date thereof. 

§ 62. Notice of the contents of such order shall be-.p^P"''- 
published, once in each week, for three weeks successively, 
in the state paper, and in a newspaper published in the 
county where the principal place of conducting the busi- 
ness of such corporation shall be situated. 

§ 63. On the day appointed in such order, such mas- p™eed- 
ter shall proceed to hear the allegations and proofs of the '"" 
parties, and shall take testimony in relation thereto, and 
shall with all convenient speed, report the same to the 
court, with a statement of the property, effects, debts, 
.credits and engagements of such corporation, and of all 
other matters and things pertaining to the affairs of such 
corporation. 

§ 64. Such master shall be entitled to the use of the tuTo''n^&o.''°' 
original petition and schedules annexed thereto, if he re- 
quire the same, by an order on the clerk or officer of the 
court with whom they may be deposited, and shall return 
the same, with his report. 

§ 65. Upon the coming in of the report of the master, wiien oor- 
if it shall appear to the court that such corporation is insol- ^^ dissolved, 
vent, or that for any reason, a dissolution thereof will be 
beneficial to the stockholders, and not injurious to the pub- 
lic interest, a decree shall be entered dissolving such cor- 
poration, and appointing one or more receivers of its 
estate and effects ; and such corporation shall thereupon be 
dissolved, and shall cease. 

§ 66. Any of the directors, trustees or other officers Ee?eivers; 



Security. 



iL'hte, 



Their an- 
ttiority. 



68 GENERAL STATUTES APPLICABLE TO 

of such corporation, or any of its stockliolders, may be ap- 
pointed receivers, who, before entering upon the duties of 
their appointment, shall give such security to the people 
of this State, and in such penalty, as the court shall direct, 
conditioned for the faithful discharge of the duties of their 
appointment, and for the due accounting for all moneys 
received by them. 
Their § 67. Such reccivors shall be vested •with, all the estate, 

real and personal, of such corporation, from the time of 
their having filed the security hereinbefore required, and 
shall be trustees of such estate for the benefit of the credi- 
tors of such corporation and of its stockholders. [See note 
2i, ante.] 

§ 68. Such receivers shall have all the power and au- 
thority, conferred by law upon trustees to whom an assign- 
ment of the estate of insolvent debtors may be made, pur- 
suant to the provisions of the fifth Chapter of the Second 
Part of the Kevised Statutes. [See 2 B. S. 40— 51.J 
To prose- §69- If there shall be any sum remaining due upon 

?rar8o°fstook. any share of stock subscribed in such corporation, the re- 
ceivers shall immediately proceed and recover the same, 
unless the person so indebted shall be wholly insolvent ; 
and for that purpose may file their bill in the court of 
chancery, or may commence and prosecute an action at 
law, for the recovery of such sum, without the consent of 
any creditors of such corporation. 
Togiveno- § TO. The receivers, immediately ou their appointment, 

pofntmeBt, shall givc noticc thereof, which shall contain the same 
matters required by law in notices of trustees of insolvent 
debtors ; and in addition thereto, shall require all persons 
holding any open or subsisting contract of such corpora- 
tion, to present the same in writing and in detail to such 



&c. 



BANKING CORPOEATIONS. 69 , 

receivers, at the time and place in such notice specified ; 
which shall be published for three weeks in the State 
paper, and in a newspaper printed in the county where 
the principal place of conducting the busioess of such cor- 
poration shall have been situated. 

§ 71. All sales, assignments, transfers, mortgages, and certain 
conveyances of any part of the estate, real or personal, '"''^• 
including things in action, of every such corporation, made 
after the filing of the petition for a dissolution thereof, in 
payment of, or as a security for, any existing or prior 
debt, or for any other consideration, and all judgments 
confessed by such corporation after that time, shall be 
absolutely void as against the receivers who may be ap- 
pointed on such petition, and as against the creditors of • 
such corporation. 

§ 72. After the first publication of the notice of the Debtors to 

" ■*■ account to 

appointment of receivers, every person having possession "°^''™' 
of any property belonging to such corporation, and every 
person indebted to such corporation, shall account and 
answer for the amount of such debt and for the value of 
such property to the said receivers ; and all the provisions 
of law, in respect to trustees of insolvent debtors, the col-reoeivera." 
lection and preservation of the property of such debtors, 
the concealment and discovery thereof, and the means of 
enforcing such discovery, shall be applicable to the re- 
ceivers so appointed, and to the property of such corpora- 
tion. 

§ 73. Such receivers shall have the same power to set-^^^j^^«JJ*^°s 
tie any controversy that shall arise between them and any^'^^" 
debtors or creditors of such corporation, by a reference, as 
is given by law to trustees of insolvent debtors ; and the 
same proceedings for that purpose shall be had, and with 



70 GENERAL STATUTES APPLICABLE TO 

tlie like effect ; and application for the appointment of re- 
ferees may be made to any oflScer authorized to appoint 
such referees on the application of trustees of insolvent 
debtors, who shall proceed therein in the same manner ; 
and the referees shall proceed in like manner, and file their 
report with the like effect in all respects. 
Meetings 8 74. The receivers shall be subiect to all the duties 

of creditors ^ « 

iobe called, ^^^ obligations by law imposed on trustees of insolvent 
debtors, so far as they may be applicable, except where 
other provisions shall be herein made. They shall call a 
general meeting of the creditors of siich corporation, with- 
in four months from the time of their appointment, when 
all accounts and demands for and against such corpora- 
■ tion, and all its open and subsisting contracts, shall be as- 
certained and adjusted as far as may be, and the amount 
of moneys in the hands of the receivers declared. [See 2 
B. S. 40— 51.J 

. suhfistiDg 8 Y5. If there shall be any open and subsisting en- 
contracts. " ./ JT O 

gagements or contracts of such corporation, which are in 
the nature of insurances or contingent engagements of any 
kind, the receivers may, with the consent of the party 
holding such engagement, cancel and discharge the same, 
by refunding to such party the premium or consideration 
paid thereon by such corporation, or so much thereof as 
shall be in the same proportion to the time which .shall 
remain of any risk assumed by such engagement, as 
the whole premium bore to the whole term of such risk ; 
and upon such amount being paid by such receivers to 
the person holding or being the legal owner of such en- 
gagement, it shall be deemed canceled and discharged as 
against such receivers. 
Receivers' § 76. Such rcceivers shall, in addition to their actual 

commjsaions 

disbursements, be entitled to such commissions as the 



BAIfKING CORPORATIONS. Tl 

court shall allow, not exceeding the sum allowed by law 
to executors or administrators. 

§ Y7. The receivers shall retain out of the moneys in to retain 

certain mo- 

their hands, a sufficient amount to pay the sums, which neys. 
they are hereinbefore authorized to pay, for the purpose 
of canceling and discharging any open or subsisting en- 
gagements. 

§ Y8. If any suit be pending against the corporation ib. To 

meet suits. 

or against the receivers, for any demand, the receivers 
may retain the proportion which would belong to such de- 
mand if established, and the necessary costs and proceed- 
ings, in their hands, to be applied according to the event 
of such suit, or to be distributed in a second or other divi- 
dend. 

§ 19. The receivers shall distribute the residue of the order of 

payment of 

moneys in their hands, among all those who shall have *«'"°- 
exhibited their claims as creditors, and whose debts shall 
have been ascertained, as follows : 

1. All debts entitled to a preference under the laws of 
the United States : 

2. Judgments actually obtained against such corpora- 
tion, to the extent of the value of the real estate on which 
they shall respectively be liens : 

3. All other creditors of such coi-poration, in propor- 
tion to their respective demands, without giving any pref- 
erence to debts due on specialities. 

§ 80. If the whole of the estate of such corporation be geconaana 
not distributed on the first dividend, the receivers shall, aeni ^' 
within one year thereafter, and within sixteen months 
after their appointment, make a second dividend of all the 
moneys in their hands, among the creditors entitled there- 
to ; of which, and that the same will be a final dividend, 



73 GENERAL STATUTES APPLICABLE TO 

three weeks' notice shall be inserted once in each week, 
in the State paper, and in a newspaper printed in the 
county where the principal place of business of such cor- 
poration was situated. 

. ^'^^^r §81. Such second dividend shall be made in all re- 
spects in the same manner as herein prescribed in relation 
to the first dividend, and no other shall be made thereafter 
among the creditors of such corporation, except to the 
creditors having suits against it, or against the . receiv- 
ers, pending at the time of such second dividend, and 
except of the moneys which may be retained to pay 
such creditors, as herein, provided ; but every creditor who 
shall have neglected to exhibit his demand before the first 
dividend, and who shall deliver his account to the re- 
ceivers before such second dividend, shall receive the 
sum he would have been entitled to on the first dividend, 
before any distribution be made to the other creditors. 

exWMted"' § 82. After such second dividend shall have been 
made, the receivers shall not be answerable to any credi- 
tor of such corporation, or to any person having claims 
against such corporation, by virtue of any open or subsist- 
ing engagement, unless the demands of such creditor shall 
have been exhibited, and the engagements upon which such 
claims are founded, shall have been presented to the said 
receivers, in detail and in writing, before or at the time 
specified by them in their notice of a second dividend. 
Surplus to § 83. If after the second dividend is made, there shall 

stockholders, 

remain any surplus m the hands of the receivers, they 
shall distribute the same among the stockholders of such 
corporation, in proportion to the respective amounts paid 
in by them, severally, on their shares of stock. 
j^Money re- § 84. When any suit pending at the time of the second 
dividend, shall be terminated, they shall apply the moneys 



BANKINa CORPORATIONS. Y3 

retained in their hands for that purpose, to the payment 
of the amount recovered, and their necessary charges and 
expenses ; and if nothing shall have been recovered, they 
shall distribute such moneys, after deducting their ex- 
penses and costs, among the creditors and 8,tockbolders of 
the corporation, in the same manner as herein directed in 
respect to a second dividend. 

§ 85. The receivers shall be subject to the control of control of 
the court of chancery, and may be compelled to account ''°°'''''^'^'' 
at any time ; they may be removed by the court, and any 
vacancy created by such removal, by death or otherwise, 
may be supplied by the court. 

§ 86. "Within three months after the time herein pre- Acoomt 

by them. 

scribed for making a second dividend, the receivers shall 
render a full and accurate account of all their proceedings 
to the court of chancery, on oath, which shall be referred 
to a master to examine and report thereon. 

§ 8Y. Previous to rendering such account the receivers Previous 

Dotice tbere- 

shall insert a notice of their intention to present the same, °^ 
once in each week, for three weeks, in the state paper, and 
in a newspaper, of the county in which notices of divi- 
dends are herein required to be inserted, specifying the 
time and place at which such account will be rendered. 

8 88. The master to whom such account shall be re- „ , , 

" Masters 

ferred, shall hear and examine the proofs, vouchers, and^"'^' 
documents offered for or against such account, and shall 
report thereon fully to the court. 

§ 89. Upon the coming in of such report, the court 



shall hear the allegations of all concerned therein, and f *°'"'™* ' 



Settlement 
if accouD 
'■ Its effect. 

shall allow or disallow such account, and decree the same 
to be final and conclusive upon all the creditors of such 
corporation, upon all persons who have claims against it. 



74 GENERAL STATUTES APPLICABLE TO 

upon any open or subsisting engagement, and upon all the 

Further stockholdcrs of such corporatiou. Such raceivers shall 

be'renaered. also accouut from time to time in the same manner, and 

with the like effect, for all moneys which shall come to 

their hands after the rendering of such account, and for all 

moneys which shall have been retained by them for any 

of the purposes hereinbefore specified, and shall pay into 

court all unclaimed dividends. 

Appeal § 90. Any decree or order of the court of chancery, 

from decrees o ./ .- ^ 

and orders, j^^^q upou any petition presented pursuant to the provi- 
sions of this Article, or in the course of any proceedings 
thereon, shall be subject to an appeal, in the same manner 
as other orders and decrees of the said court, if the same 
be made within six months after such order or decree 
. made. 

Corporations § 91. The provisious of this Article shall not extend to 

excepted. 

any incorporated library society, or to any religious cor- 
poration, or to any select school or academy, incorporated 
by the regents of the university, or by the legislature. 
[See note 25.] 



(25) DECISIONS OF THE COURTS UPON SECTIONS OF THE ABOVE 
ARTICLES, TWO AND THREE. (2 JJ. S. 462-467.) 

1 Paige, 85 ; In the Matter of the Franklin Sank. (Act of April 21, 
1825) 

1 Paige, 511 ; Attorney Qeneral v. The Bank of Columbia. (Act of April 
21, 1825.) 

3 WenA 588 ; Attorney General v. The Bank of Oolumhia. (Act of April 
21, 1825.) 

1 Paige, 584, 685 ; Bruyn v. Meceiver Middle District Bank. 

1 Paige, 258 ; In the Matter of the Niagara Insurance Co. 

2 Paige, 438 ; Verplanck T. Mercantile Insurance Co. 

3 Paige, 213 ;, Robinson v. Smith. 

4 Paige, 224 ; Attorney Qeneral v. lAfe and Fire Insurance Co. 

5 Paige, S21 ; Devoe v, Ithaca and Owego R. R. Co. 

6 Paige, 497 ; Bank Commissioners v. Bank of Buffalo. 



BANKING CORPORATIONS. • Y5 



ACT OP APRIL 17th, 1830. 

[LAWS 1830. CHAP. 243. p. 266.] 

An Act concerning Bank Notes: passed April 11th, 1830. 



The People of the State of New York, re^presented in 
Senate amd Assembly, do enact as follows : 

§ 1. Every note, bill or other evidence of debt, pur- 
porting to be a bank note, issued or to be issued by any 
incorporated banking institution of tbis State, shall, after 
the passage of this act, be deemed and taken to be paya- 
ble at the hanking house of such incorporated banking 



6 Paige, 213 ; In the Matter of the Bank of Niagara. 

6 Paige, 220 ; Holbrook v. Receivers of American Insurance Co. 

6 Paige, 102; In the Matter of Receivers of Qlohe Insurance Co. 

I Paige, 294 ; Ward v. Sea Insurance Co. 

8 Paige, 380 ; In the Matter of Waterbury v. Trustees of Magle Iron 
Works. 

9 Paige, 598 ; Judson v. Rossie and Galena Co. 

9 Paige, 471 ; Attorney Q-eneral v. lAfe and Fire Insurance Co. 

9 Paige, 162; Nathan v. Whitlock. 

10 Paige, 290 ; Morgan t. N. Y. and Albany R. R. Co. 

10 Paige, 378 ; In the Matter of Receiver of City Bank of Buffalo. 

II Paige, 118; Micklesy. Rochester City Bank. 

1 Barb. Ch. R. 122; Pentz v. Bawley.- 

2 Barb. Cli. R. 360 ; In Matter of Croton Insurance Co. 

3 Barb. Ch. R. 642 ; In Matter of Croton Insurance Co. 

3 Edw. Cli. R. 215; Nathan y. Whitlock. 
2 Sand. Ch. R. 257 ; Mann v. Pentz. 

2 Sand. Ch. R. 23 ; Boisgerard v. N. Y. Banking Co. 

4 Sand. Ch. R. 577 ; Hill v. Nautilus Insurance Co. 

4 Sand. Ch. R. 659 ; In Matter of Jackson Marine Insurance Co. 

3 Comstook, 415 ; Mann v. Pentz. 

3 Selden, 147 ; Bogardus v. Rosendale Manufacturing Co. 
12 Barb. S. C. R. 341 ; Damman v. Umpire Mills. 



76 GENERAL STATUTES APPLICABLE TO 

institution, any law or usage to the contrary hereof not- 
withstanding. (26) 



(26) By § 31 of the General Banking Law (Laws 1838, p. 253), it is en- 
acted as follows : 

" § 31. It shall not he lawful for any association formed under the pro- 
visions of this act, to make any of its bills or notes of a denomination less 
than one thousand dollars, to be put in circulation as money, payable at any 
other place than at the office where the business of the association is carried 
on and conducted." By § 3 of the General Bank Act, it is provided, that 
the promissory notes, thereby authorized to be loaned and circulated as 
money by associations and individual bankers, shall be made payable at " the 
place of business, within this State, of such person or association," The cer- 
tificate required to be filed by § 16 of the same act, only provides for a 
designation, of the " particular city, town, or village." 



Apeil 26th, 1832, the Legislature passed an act, entitled "An Act to pre- 
vent the abatement of suits by or against corporations in certain cases," 
(Zaws 1832, Chap. 295, p. 509, §§ 1, 2, 8, 4.) 



BANKING CORPORATION^ ' 77 

ACT OF MAY 11th, 1835. 

[LAWS 1835: CHAP. 307, p. 355.] 

An Act to amend the act entitled, " An act to create a 
f'ondfor the ienefit of the creditors of certain moneyed 
corporations, a/nd for other purposes " passed April 2. 
1829. Passed, May 11, 1835. 



The People of the State of New YorTc, represented in 

Senate and AsserrMy, do enact as follows : 

§ 1. It shall not be lawful for aw^mojieyecZ cor^orafo'ow .Eestric- 
to charge, or in any manner receive the ■premium of ex- *™'''- 
change on any draft made by such corporation, which shall 
be used or applied in the payment of any bill, note, or 
other demand, due to or discounted by such corporation, 
or to be interested directly or indirectly in the premiums 
on drafts which may be drawn or sold by any other corpo- 
ration or by any individual. 

§ 2. \isYiaS\.Jiot\i&\smfvlioTam.y moneyed corporation ^^^^^l^^, 
to be in any manner, directly or indirectly, interested in"°*' 
the fees of any notary public, or entitled to, or to^ receive 
any share of the same, in any manner whatsoever ; and 
any officer or clerk of such corporation being a notary 
public shall not be entitled to charge or receive more than 
fifty cents for protesting and giving the requisite notices 
upon any note or bill of exchange, check or draft, paya- 
ble at the office of such corporation ; nor shall any such 
corporation or any of its officers or clerks, charge or re- 
ceive any sum for a notice upon any note, bill, or draft 
which IS not duly protested ; nor shall a notary receive 
any fees for protesting or giving the notice on any note, 
bill of exchange, check or draft, in which any moneyed cor- 



# 

78 GENERAL STATUTES APPLICABLE TO 

poration shall be interested, of wliicli such notary shall be 
a stockholder. 

Eestrio- §3. It shallnot helawiul ioT otiy mone'i/ecl corpovation 

loans and dis-' to place in the hands of any person, directly or indirectly, 
any money or bank notes, for the purposes of loaning or 
discounting of paper, or under any pretense whatever of 
discounting or engaging that avy moneyed corporation shall 
discount any note or draft, if presented at its counter. 

Directors. § 4. No cashier or director of a moneyed corporation 
within this State homing hanJcing poxoers, shall hold the 
office of director in any other moneyed corporation holding 
its charter under the safety fand system. 

Bank com- § 6. The bank commissioners shall have power, and it 

mist-ioners to 

rrort"" ""* shall be their duty, to examine under oath, the officers of 
all banks subject to their supervision, as to any offence 
against the provisions of this act and shall report to the 
legislature the names of any such corporations as shall of- 
fend against the provisions of this act, or who shall adopt 
and pursue any course of business with the intention of 
receiving more than the legal rate of discount. 
They may 8 6. The commissioncrs shall be authorized to applv 

apply for an • ^^ J 

injaoction. ^^ |.|^g chancellor, pursuant to the eighteenth section of the 
act hereby amended, for an injunction against any moneyed 
corporation who shall violate any of the provisions of this 
act, or who shall adopt or pursue any course of business 
which by this act the said commissioners are directed to re- 
port to the legislature, and the court of chancery may pro- 
ceed in the same manner as in any case now provived for 
by the eighteenth section of the act hereby amended. [See 
note 27.] 



(27) By 1 R.S. 698, § 51, it is enacted that, " the term ' moneyed corpora- 
tion,' as used in this Title, shall be construed to mean every corporation 



BANKING CORPORATIONS. Y9 

haying banking powers, or haTing the power to make^loane upon pledges or 
deposits, or authorized hy law to make insurances." (See p. 23, ante.) 

By § 1 of the act of AprU 2d, 1829 (amended by^the above act of May 
11th, 1836), it is enacted dS follows : 

" § 1. Every moneyed corporation having banking powers, hereafter to 
be created in this State, or whose charter shall be renewed or extended, 
shall be subject to the provisions of this Act." {Laws 1829, p. ISt.) {Seep. 
29, ante.) 

The Court of Appeals has finally adjudged, that associations formed un- 
der the General Banking Law are corporations — and moneyed corporations ; 
and that they are within and subject to the general statutes of this State, 
applicable to moneyed corporations, except when such statutes are incon- 
sistent with the General Bank Act, or the acts amending the same. Oillett 
V. Moody (3 Comst. 479); Talmage v. Pell (3 Selden, S28.) 

The Supreme Court, in Cuyler & Sexton v. Sanford (8 Barb. S. C. R. 225), 
held, that the prohibition contained in § 1 of the above act of May 11th, 
1835, does not apply to individual bankers under the General Bank Act ; that 
although an association under that act is a corporation, yet, that an individ- 
ual banker cannot be so regarded ; that he lacks one of the attributes of a 
corporation, to wit, — its principle of succession and perpetuity. 



5* 



80 GENERAL STATUTES APPLICAB TO 

TITLE IV. 

SPECIAL PEOYISIONS EELATING TO CEETAIN 
CORPOKATIONS. (1 i?. ^. 601.) 

Sko. 1. Certain books of incorporated companies to be kept open, for certain 
time. 
2.- Certain prohibitions and restrictions upon directors of corporations, 
officers, <&c. 

3. Debts of corporations not to exceed certain amount; penalty for 

excess. 

4. Certain transfers of property prohibited ; corporations dissolved in 

certain cases. 

5. Supreme court to correct illegal elections; proceedings for that 

purpose. 

6. By-laws regulating elections ; evidence of right to vote. 

7. Oath to be taken by inspectors of elections. 

8. On failure to hold elections of directors, new day to be appointed ; 

proceedings. 

9. Penalty on corporations, &c., for purchasing their notes, iStc, at less 

sum than that due thereon. 

10. Officers, (fee, of corporations not to loan upon notes offered to them 

officially for discount. 

11. Extent and application of the provisions of this Title. 

Certain § 1- The book or books of any incorporated company 

open a* cer- jn this State, in whicb the transfer of stock in any such 

tain times. *" 

company shall be registered, and the books containing 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 daysprevious to any election 
of directors; and if any officer having charge of such 
books shall, upon demand by any stockholder as aforesaid, 
8 Wend. 588. 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 



BANKING CORPORATIONS. 80a 

the other moiety to him who will sue for the same, to be 
recovered by action of debt in any court of record, to- 
gether with the costs of such suit- 

S 2. It shall not be lawful for the directors or managers DWdenas 

" , from surpltis 

of any incorporated company in this State to make divi- p'oA's ""^y- 
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, with- 

1 1 1 ij J" Capital not 

draw, or m any way pay to the stockholders, or any or to be re- 
them, any part of the capital stock of such company, or to 
reduce the said capital stock, without the consent of the 
legislature ; and it shall not be lawful for the directors of 
such company to discount or receive any note, or oliier Notes for 

• 1 ' K 1 ^ • n •1 n instalments 

evidence ot debt, m payment ol any instalment actually on stock not 
called in and required to be paid, or any part thereof, due ™"™*^*- 
or to become due on any stock in the said company ; nor 
shall it be lawful for such directors to receive or discount :;,,:;j 
any note, or other evidence of debt, with the intent of en- to^'Trfthd'aw 

1 ■ ' i ' , ' • ' , instalments, 

abling any stockholder in such company to withdraw any 
part of the money paid in by him on his stock ; and in 
case of any violation of the provisions of this section, the 

, ■' i i ^ ■ ' IJabUltyof 

directors under whose administration the same may have ^"X"'" 
happened, except those who may have caused their dissent sio'm. '"° 
therefrom to be entered at large on the ihinutes of the said 
directors at the time, or were not present when the sameswend.eis. 
did happen, shall, in their individual and private ca,pacities, 
jointly and severally be liable to the said corporation, and 
to the creditors thereof in the event of its dissolution, to 

, I -. . • ■ . . ^ ' 1 . ,'''.!''.'■' Extent of 

the full amount of the capital stock of the said company"**""'^' 
so divided, withdrawn, 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 



805 GENERAL STATUTES APPLICABLE TO 

amount of any notes or other evidences of debt so dis- 
counted with the intent aforesaid, with legal interest on 
the said respective sums, from the time such liability ac- 
Notbarredcrued; and no statute of limitations shall be a bar to any 

by statute of , . . . it 

iiirftationfl. suit at law or m equity against such directors, for any 
sums for which they are made liable by this section : Pro- 

Proviso 

vided, That this section shall not be construed to prevent 
a division and distribution of the capital stock of such com-, 
pany which shall remain after the payment of all its debts, 
upon the dissolution of such company, or the expiration of 
its charter. 
Amount of 8 3. The total amount of the debts which any incor- 

debts. ° •' 

porated company shall at any time owe, whether for de- 
posits, or by bond, bill, note, or other contract, over and 
above the actual deposits with the said company, shall 
riot at any time exceed three times the amount of the capi- 
tal stock actually paid in ; and, in case of any excess, the 

^c^B^'for directors, under whose administration the same may have 
happened, except those who may have caused their dissent 
therefrom to be entered at large on the minutes of the said 
directors at the time, and except those who were not pres- 
sent 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 
Not barred ^^''^ liability accrued ; and no statute of limitations shall 

i^tattoM." be a bar to any suit at law or in eqiuty against such direc- 
tors, for any sums of money for which they are made liable 
by this section. 
Certain | 4. Whenever any incorporated company shall have 

proSffia. refused the payment of any of its notes, or other evidences 



BANKING CORPORATIONS. 80(r 

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 ac- 
tion of such company, to any officer or stockholder of such 
company, directly or indirectly, for the payment of any 
debt ; and it shall not be lawful to make any transfer or 
assignment in contemplation of the insolvency of such 
company, to any. person or persons whatever; and every 
such transfer and assignment to such officer, stockholder, or 
other person, or in trust for them or their benefit, shall be 
utterly void ; and whenever any incorporated company 
shall have remained insolvent for one whole year, or for 
one year shall have neglected or refused to redeem its oorpora- 
notes or other evidences of debt, in specie or other lawful ea dissoiTeai 

in certain 

money of the United States, or shall, for one year, have '=*'^=- 
suspended the ordinary business of such incorporation, 
such company shall thereupon be deemed and adjudged to 
have surrendered the rights, privileges and franchises 
granted by any act of incorporation, and shall be deemed 
to be dissolved. 

§ 5. It shall be the duty of the supreme court, upon Powers of 

_ supreme 

the application of any person or persons, or body corporate, ""^JJiJ"" 
that may be aggrieved by, or may complain of, any elec- *'"'"'""• 
tion, or any proceeding, act, or matter, in or touching the 
same (reasonable notice having been given to the adverse 
party, or to those who are to be affected thereby, of such 
intended application), to proceed forthwith and in a sum- 
mary way to hear the affidavits, proofs and allegations of 
the parties, or otherwise inquire into the matters or causes 
of complaint, and thereupon to establish the election so 
complained of, or to order a new election, or make suck 
order and give such relief in the premises as right and 



80d GENERAL STATUTES APPLICABLE TO 

justice may appear to the said supreme court to require r 

inj'°°°° " Provided, That the said supreme court may, if the case 
shall appear to 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 oflSce or offices or 
franchise in question ; or may give leave to exhibit, or 
direct the attorney-general to exhibit, one or more inform- 
ation or informations in the nature of a quo wa/rranto in 
the premises. 
Certain by- § ^- ^0 by-law of tlic directors and managers of any 

published! incorporated conipany, regulating the election of directors 
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 

right to vote. g|;Qg]j Qf 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 
evidence of stock held in the said company ; and all such 
shares as may appear standing thereon in the name of any 
person or persons shall be voted on by such person or per- 
sons directly by themselves, or by proxy, subject to the 
provisions of the act of incorporation, 
oaffiofin- § 7. The inspectors who may be appointed to conduct 

election, any election of directors or any other officer of any incor- 
porated company of this State, shall be required, before 
entering on the duties of their appointment, to take or sub- 
scribe 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 



BANKING CORPORATIONS. 806 

held with strict impartiality, and according to the best of 
my ability." , 

§ 8. If at any time hereafter the election for directors „,°°j^*^^^^ 
of any bank or other incorporated company of this State to b?lp-**^ 

pointed. 

shall not be duly held on the day designated and appointed 
by the act incorporating such bank or other incorporated 
company, it shall be the duty of the president and direct- 
ors 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 ytJ^Jto^'tg 
shares shall be voted upon, except by such person or per-B°qu"n^tdayi 
sons who may have appeared on the transfer books of said 
company 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 afore- 
said upon the transfer books of such company, on any day 
when such election may be held. 

§ 9. It shall not be lawful in any company incorporated Corpora- 
for banking purposes, its officers, agents, or servants, or "ft"™^^*''- 
any of them, directly or indirectly to purchase or to be notes at a 

discount. 

interested in the purchase of any promissory note, or other 
evidence of debt, issued by any such company, at a less 
sum than appears by the face thereof to be due an.d pay- 
able ; and any person offending against the provisions of penalty. 
this section shall forfeit and pay three times the nominal 
amount of the note or other evidence of debt so pur- 
chased, to be recovered, with costs of suit, by any person 
who will sue for the same in any court of competent 
jurisdiction. 

§ 10. It shall not be lawful for any person being presi- ^officers.^. 
dent, director, cashier, clerk, agent, or any way interested {jj^"^ „p°n'° 

certain notes 



SOf GENERAL STATUTES. 

or concerned in the management of the concerns of any 
feuch company, to discount, or directly or indirectly make 
any loan upon any note, bill, or other evidence of debt, 
which shall have been offered to such directors for dis- 
Notes, 4c., count : and every note, bill, or other evidence of debt so 

void. 4 ' "' ' ' 

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 
Further the pcrsou offending herein, knowing that such note had 
been so 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. 
Extent of § ^^- '^^^ provislous of this Title shall not apply to any 

this Title, incorporated library, or religious society ; nor to any 

moneyed corporation which shall have been or shall be 

created, or whose charter shall be renewed or extended, 

after the first day of January, one thousand eight hundred 

BeeTitiea ^^^ twcnty-eight, and which shall be subject to the pro- 

mlie. " ' visions of the second Title of this Chapter. (27a.) 



(2'7a) In June, 1860, the (7ow< of Appedls, m Robinson y. The Bank of 
Attica (21- N. Y. R. 406), held that banking corporations under the general 
banking law are within the proyiBions of the 4th section of the above Fourth 
Title of the Revised Statutes, prohibiting " any incorporated company" which 
shall have refused the payment of any of its notes or other evidences of 
debt in specie, or lawful money of the United States, " to make any transfer 
or assignment, in contemplation of the insolvency of such company, to any 
person or persons whatever;" and that they are not excluded by the excep- 
tion in the 11th section of that Title; because, though moneyed corporations, 
they are, by the recent construction of the general banking law, not subject 
to Title II., of the^same^Caiapter of the Revised Statutes. See Title II, pp. 1 
to 24, ante ; alio, the case above cited and note, post. 



SPECIAL STATUTES 

APPLICABLE TO 

BANKING CORPORATIONS 

AND 

INDIVIDUAL BANKERS. 



[general banking law as oeiginallt passed.] 
(laws 1838, chap. 260, p. 245.) 



An Act to authorize the business of JBanking. JPassed 
April 18, 1838. 

The People of the State of New YarJc, represented in 
Senate and AssewMy, do enact as follows : 

§ 1. The comptroller is hereby authorized and required 
to cause to be ei graved and printed in the best manner, to drcaiatSig'^* 
guard against counterfeiting, such quantity of circulating co'ntereignea 
notes, in the similitude of bank notes, in blank, of the dif- ^^™ '''* 
ferent denominations authorized to be issued by the incor- 
porated banks of this State, as he may from time to time 
deem necessiirv, to carry into effect the provisions of this 
act, and of such form as he may prescribe. Such blank 
circulating notes shall be countersigned, numbered, and 
registered in proper books, to be provided and kept for that 
purpose in the oiSce of said comptroller, under his direc- 
6 



82 SPECIAL STATUTES APPLICABLE TO 

• 

tion, by such person or persons as the said comptroller 
shall appoint for that purpose, so that each denomination 
of such circulating notes shall all he of the sa/me similitude, 
and bear the uniform signature of such register, or one of 
such registers. ( 28 ) 
ontransfer § 2. "Whenever any person or association of persons, 
faS^'note"" foi'mcd for the purpose of banking under the provisions of 
S''by Mmp' this act, shall legally transfer to the comptroller any portion 
socktions. of the public debt now created, or hereafter to be created, 
by the United States, or by this State, or such other States 
of the United States as shall be approved by the comptrol- 
ler, 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 debt shall in 
stock to be all cases be, or be made to be, equal to a stock of the State 

equal to 5 

rtook^of 'tiis producing five per cent, per annum ; and it shall not be 
*'***■ lawful for the comptroller to take any stock at a rate above 
its par value. ( 29 ) 

§3. Such person or association of persons are hereby au- 
iuttoHzert to thorized, after having executed and signed such circulating 
as money, notes in the manner required by law, to make them obliga- 
tory promissory notes, payable on demand, at the place of 



(28) § 1 amended, May 26, 1841 {Laws 1841, chap. 319, p. 309, § 6), by 
excluding therefrom the words, " all be of the same similitude and." See Act 
of May 26, 1841, j)OS«. 

By § 8 of the act of April 15th, 1854 {Laws 1854, ctap. 242, p. 551 ), it is 
enacted, that the " circulating notes delivered to individual hankers, shall 
express only the individual liahility of the banker issuing them, and shall be 
signed by him only, and not by any attorney or agent." See this act, post. 



(29) § 2 amended so as to make it unlawful for tlfe comptroller or the 
Superintendent of the Banlc Department to receive any State stocks except 



BANKING CORPORATIONS. 83 

business witliin this State, of such person or association, to 

the public stock issued or to be issued by the State of New York. See the 
following acts: 

Act of May 14th, 1840 {Lms 1840, chap. 363, p. 301, § 1). 
Act of March 16th, 1844 {Laws 1844, chap. 41, p. 85, § 1). 
Act of April 12th, 1848 (Laws 1848, chap. 340, p. 462, § 1). 
Act of March 12th, 1849 {Laws 1849, chap. 97, p. 136, § 2). 
Act of April 10th, 1849 {Laws 1849, chap. 313, p. 455, § 1). 
See these acts, post. 



It was finally adjudged by the Court of Appeals, ia October, 1852, in 
Talmage v. Pell (3 Selden, 328, 347, 348), that associations, organized under 
the General Banking Law, " have no power to purchase State or other stocks 
for the purpose of selling them for profit, or as a means of raising money, 
except when such stocks have been received in good faith as security for a 
loan made by or a debt due to such association, or when taken in pay- 
ment, in whole or in part, of such loan or debt" See, also, The Bank Com- 
missioners V. The St. Lawrence Bank (3 Selden, 513). 

All bank charters granted by this State, from 1791 to 1838, contained an 
express prohibition, substantially in the following words, — " The said corpo- 
ration shall not, directly or indirectly, deal or trade in buying or selling any 
goods, wares, merchandise, or commodities whatsoever, or in buying or sell- 
ing any stock created under any law of the United States, or of any particu- 
lar State, unless in selling the same when truly pledged by way of security 
for debts due to the said corporation." See the charters of every Safety 
Fund Bank, as well as the charters granted before 1829. 

The two charters of the National Bank of the United States, granted by ■ 
Congress in 1791 and 1816, contained express prohibitions against trading in 
any thing except bullion, &c. ; also, against purchasing any public debt 
whatever. See these charters, in the United States Statutes at Large. . 

The charters of the Bank of England, Bank of France, Bank of Scotland, 
and Bank of Ireland, also contain express prohibitions against trading (Stat- 
utes-at-Large, quarto ed., vol. 3, p. 558 ; 1 McCuUoch's Diet., American ed. 
(1840), pp. 76, 117, 121, 122; Lawson's History of Banking, Amer. ed., p. 
228; Rees'Cyclo. article "Bank.") 



The Safety Fund Banks were bound to pay annually to the treasurer of 
the State a sum equal to one half of one per cent, on their capital stock, until 
such payments amounted to three per cent, upon their respective capitals 
(Laws 1829, 167, §§ 2, 4 ; see pp. 29, 30, ante). By the Safety Fund sys- 
tem, the "bank fund" was not only limited to a specified percentage 
on capital, but was made liable for the payment of all the " debts, exclusive 



84 SPECIAL STATUTES APPLICABLE TO 

loan and circulate the same as money, according to tbe or- 

of capital stock, of any of the said corporations " which should become insol- 
vent (see §§ 4, 9, 10, of the act of 1829, pp 30, 31, 32, ante). But by the 
general law of 1838, no bill or note can be delivered out by the Slate officer 
having exclusive charge of the issue department, unless the same shall be first 
secured by a transfer to that department of government stocks, <!sc., in value 
equal to the full amount of every bill or note so issued; and such stocks, &c., 
are to be held in pledge " exclusively for the redemption " of such bills or 
notes (§ \%post). By the system of 1829, the "Safety Fund" was raised 
by a contribution of a small percentage upon the capital of each bank, with- 
out any reference whatever to the amount of its issues. But under the sys- 
tem of 1838, the trust fund, held in pledge by the issue department, is ^ro- 
portioned to the issues of each banking corporation and individual banker, with- 
out any reference whatever to the amount of their nominal or actual capitals. 
The principle of separating the issue from the banking department was 
advocated by Mr. Lotd, in England, as early as the year IBS'?. In 1838, it 
was adopted by the legislature of New York ; and in 1844, Sir Robert Peel 
practically carried into effect the same principle, in dealing with the Bank 
of England on the renewal of its charter iii that year. By the renewed 
charter (1844) of this institution, it is enacted that there shall be transferred, 
(fee, " to the issue department of the Bank of England, securities to the value 
of £14,000,000, whereof the debt due by the public to the said governor and 
company shall be and be deemed a part." (See this Act, Stat. 7 & 8 Vict., 
c. 32.) 

" The object of this statute (Stat. 1 & ?, Vict, c. 32) has been," says Mr. 
McCnLLOCH, " to obviate the chances of over issue and sudden fluctuations in 
the quality and value of money, by limiting the power to issue notes payable 
on demand," <fec. * * * " While the directors are left to manage the 
banking department at their discretion, their management of the issue depart- 
ment is subjected to what seems to be a well-devised system of restraint. 
The bank is allowed to issue to £14,000,000 of notes, upon securities (of which 
the debt of £11,015,100 lent by her to Government is apart); and whatever 
paper the issue department may at any time issue over and above this maxi- 
mum amount of securities, it must have an equal amount of coin and bul- 
lion in its coffers. Hence, it is impracticable for the issue department to in- 
crease its issues without, at the same time, proportionally increasing its stock 
of coin and bullion, or to diminish the latter without proportionally dimin- 
ishing the amount of paper supplied to the public and banking department" 
(McCuUoch's Diet., London ed., 1850, pp. 82 to 88 ; Laweon's Hist of Bank- 
ing, Amer. ed., 1852, pp. 76, 11 ; Gilbart on Banking, Amer. ed., 1851, p. 61; 
Levi on Mercantile Law, 1854, p. 202.) 

In 1846, the people of this State made it a part of the fundamental law, 
that " the legislature shall provide by law for the registry of all bills or 
notes issued, or put in circulation as money, and shall require ample security 
for the redemption of the same in specie." (Constitution 1846, Art 8, § 6.) 



BANKING CORPORATIONS. 85 

dinary course of banking business, as regulated by the laws 
and usages of this State. ( 30 ) 

(so) § 35 of tlie amendatory act of April 2, 1829 (see p. 38, note 14, ante), 
is in these 'words : " No moneyed corporation subject to the provisions of this 
act, shall issue any bill or note of the said corporation, unless the same shall 
be made payable on demand and without interest." § 1 of the same act 
(see p.' 29, ante) is in these "words : " Every moneyed corporation having 
hanking powers, hereafter to be created in this State, or whose charter shall 
be renewed or extended, shall be subject to the provisions of this act." See 
§ 62 of the General Code of Statute Regulations of 1827 (p. 23, ante). This 
Code was amended as to all future " moneyed corporations having banking 
powers," by the act of April 2d, 1829 (see p. 29 ante, and note 13, on that 
page. See, also, Talmage v. Pell, 3 Selden, 828, 347, 348; §§ 3, 4, of the 
act of May 14, 1840, posi; § 1 of the act of May 6, 1844, ^os<; § 1 of the 
act of April 10, 1850, and notes 36 and 39, post.) 



The legislature of 1837 had repealed so much of the Restrainivg Act of 
1830 (see §§ 1, 3 cfc 6, pp. 39, 41 cfc 42, ante; also, Note 16 on p. 42, ante) as 
prohibited " a person or association of persons, not incorporated, from " keep- 
ing offices for the purpose of receiving deposits, or discounting notes or 
bills," {Laws 1837, p. 14 cfc p. 49, ante). But the inhibitions of the Restrain- 
ing Acts against the issue (by individuals or bodies corporate unless "thereto 
speceaHj/'authorized by law ") of bills, notes, or other evidences of debt, on 
loan, or for circulation as money, were left by the legislat^u'e of 1837 in full 
force (see § 4, p. 26, ante, & §§ 1, 3, c& 6, pp. 39-43, ante). The legislature of 
1838, by § 3 of the General Bank Act, so far modified §§ 1, 3, & 6, of the 
Restraining Act of 1830, and also § t on page 26, ante, as to authorize indi- 
viduals and corporations acting or formed under the general law, to " loan 
and circulate as money," countersigned and secured promissory notes, paya- 
ble on demand at their place of business within this State, " according to 
the ordinary course of banking business as regulated by the laws and usages 
of this State.'' (See Note 16, pp. 42-48, ante, and the cases there cited.) 

To authorize corporations, formed under the General Bank Act, to loan 
and circulate promissory notes, or other evidences of debt, as money, an 
express grant of power was required. (See §4, and note 12, p. 26, ante; 
also, §§ 3 & 6, and note 16, pp. 41 & 42, ante.) Hence it was conceded by 
Senator Verplanok, in Warner v. Beers (23 Wendell, 158, 159), that the 
General Bank Act was only a "conditional repeal" of the Restraining 
Acts. He says, " certain conditions are imposed to entitle them" (associa- 
tions) " to this conditional repeal. They can issu^ no paper, unless it be 
secured in a certain way, and duly attested by the comptroller. The very 
same conditions are imposed on every individual who thinks fit to engage in 
this business." (23 Wend. 158, 159) ; see, also, Safford v. Wyckoff (1 Hill, 



86 SPECIAL STATUTES APPLICABLE TO 

If notes § 4. In case the maker or maters of any such circulating 

not redeemed • i i n 

in lawftii note, countersigned and registered as aforesaid, shall at any 

money, ) o o ^ ./ 

to?e^a*e™m' time hereafter, on lawful demand, during the usual hours 
fnnd. of business, between the hours of ten and three o'clock, at 

the place where such note is payable, fail or refuse to re- 
deem such note in the lawful money of the United States, 
the holder of such note making siich demand may cause 
the same to be protested for' non-payment by a notary pub- 
lic, under his seal of office, in the usual manner ; and the 
comptroller, on receiving and filing in his office such pro- 
test, shall forthwith give notice in writing to the maker or 
makers of such note to pay the same ; and if he or they 
shall omit to do so for ten days after such notice, tbe comp- 
troller shall immediately thereupon (unless he shall be 

11_S. C, ; 4 Hill, 444, 463) ; Banh of Orleans v. Merrill (2 Hill, 295) ; Smith 
& Warner v. Strong (2 Hill, 241); Swift v. Beers (3 Denio, 70); Leavitt v. 
Palmer (3 Comstock, 19); Bank Commissioners v. The St. Lawrence Bank 
(3 Selden, 513) ; Talmage v. Pell (3 Selden, 328) ; also, the cases cited in 
Note 14, p. 40, ante. . 

The third section of the General Bank Act contains the only grant of 
power to indiyidual bankers and banking corporations to issue, loan, or cir- 
culate their own engagements or promises. See note 39, post, and note 61, 
post, and the cases there cited. 



In May, 183"?, all the banks of this State suspended specie payments 
(Laws of 1837, p. 614). 

In April, 1838, when the General Bank Act was passed, every bank in 
the United States, without a single exception, was in a state of suspension. 
Their notes and bills were made payable on demand, but they were notpaid 
when demanded. 

In the midst of this universal bank suspension, the legislature of 1838 
so far modified or repealed the Restraining Acts (§ 4, p. 26, ante, and §§ 3 & 
6, pp. 41, 42, ante) as to authorise banking corporations, formed under the 
general law, to keep offices for the purpose of receiving deposits, or dis- 
counting bills or notes ; and also, to authorize such corporations avid indi- 
viduals to loan and circulate a certain kind of secured promissory notes, 
leaving ^he inhibitions of the Restraining Acts in full force as to every 
other evidence of debt. See note 39, post, and the cases there cited ; also, 
note 1 6, pp. 42-48, ante, and the cases there cited. 



BANKING COEPOUATIONS. 87 

satisfied that there is a good and legal (Jefence 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 it shall be lawful for the 
comptroller to apply the said trust funds belonging to the 
maker or makers of such protested notes to the payment 
and redemption of such notes, with costs of protest, and to 
adopt such measures for the payment of all such circulating 
notes put in circulation by the maker or makers of such 
protested notes, pursuant to the provisions of this act, as 
will, in his opinion, most effectually prevent loss to the 
holders thereof. ( 31 ) 

§ 5. The comptroller may give to any person or associa- powers or 
tion of persons so transferring stock, in pursuance of the ^^fg^g"^*'' 
provisions of this act, powers of attorney to receive interest Sron "" 

T.,1, i'i 1 •• public Stocks 

or dividends thereon, which such person or association may &c. 
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 whenever, in the opi- 
nion of the comptroller, the principal of such stock shall beTevokcd. 
become an insuflScient security ; and the said comptroller, 
upon the application of the owner or owners of such trans- 
ferred Stock in trust, may, in his discretion, change or 
transfer the same for other stocks of the kinds before speci- 
fied in this act, or may re-transfer the said stocks, or any 
part thereof, or the mortgages, or any of them hereinafter 
mentioned and provided for, upon receiving and can- 

(31) § i amended by the Act of March 15th, 1841 (Laws 1841, chap. 46, 
p. 26, § 1): and again amended by the Act of April 5th, 1849 {Laws 1849, 
chap. 226, p. 840, § 1): and also by the Act of April IT, 1851. {Laws 1861, 
chap. 203, p. S11, % 4.) See these acts, post. 



the notes 
delivered, 



88 SPECIAL STATUTES APPLICABLE TO 

celing an equal anjonnt of such circulating notes delivered 

by him to such person or association, in such manner that 

maybe^ the circulating notes shall always be secured in full, either 

changed or , 

retransferr'd. ^y stocks or by stocks and mortgages, as in this act pro- 
vided. (3H) 
Bills how § 6. The bills or notes so to be countersigned, and the 

stamped, payment 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 § 7. Instead of transferring public stocks as aforesaid to 

token fori sccure the whole amount of such bills or notes, it shall be 
lawful for such person or association of persons, in case they 
shall 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 which case all such bills or notes issued by the said per- 
son, or association of persons, shall be stamped on their 
face, " Secured by pledge of public stocks and real estate." 

(32) 

§ 8. Such mortgages shall be only upon improved, pro- 
gages*; ™we' ductive, unincumbered lands, within this State, worth, in- 

how ascer- 
tained, dependently of any buildings thereon, at least double the 

amount for which they shall be so mortgaged ; and the 
comptroller shall prescribe such regulations for ascertain- 
ing 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. ( 32 ) 

(31 J) See Act of May 14, 1840, § 1. {Laws 1840, chap. 363, p. 306.) 
(32) §§ 7 & 8 modified by the Act of April 12tli, 1848 (Laws 1848, chap. 



Character 
of the mort- 



BANKING CORPOEATIONS. 89 

§ 9. The comptroller may, in his discretion, re-assign comptroi- 
tlie said bonds and mortgages, or any of them, to the person "m mort-*' 



mort- 
gages. 



or association who transferred the same, on receiving other 
approved bonds and mortgages of equal amount ; and when 
any sum of the principal of the bonds and mortgages trans- 
ferred to the comptroller slmjl be paid to him, he shall 
notify the person or association that transferred the bonds 
and mortgages of such payment, and may pay the same to 
such person or association, on receiving other approved 
bonds and mortgages of equal amount. ( 33 ) 

§10. The person or association of persons assigning owners of 

,-,-,, , ^-, mortgages 

such bonds and mortgages to the comptroller, may receive ?"v receive 
the annual interest to accrue thereon, unless default shall tl&'^er' 
be made in paying the bills or notes to be countersigned as 
aforesaid, or unless, in the opinion of the* comptroller, the 
bonds and mortgages or stocks so pledged shall become 
an insufficient security for the payment of such bills or 
notes. (34) 

§ 11. In case such person or association of persons shall Pledged 

securities 

fail or refuse to pay such bills or notes on demand, in the^f™'"''*' 
manner specified in the fourth section of this act, the comp- 
troller, after the ten days' notice therein mentioned, may 

340, p. 462, § 2). By § 3 of this act, it is enacted that no mortgage depos- 
ited, shall be for a greater amount than $6,000. By § 10 of the Act of 
April 12th, 1851 {Laws of 1851, chap. 164, p. 309), it is enacted, that "no 
one mortgage of lands shall hereafter be received as security for circulating 
bills to an amount greater than five thousand dollars." See these acts, 
post. 

(33) See § 7 of the Act of May 26th, 1841, post {Laws 1841, chap. 319, p. 
310, 1), also, § 4 of the Act of April 12, 1851 [Laws of 1851, chap. 164, 
p. 309.) See these acts, post. 

(34) See §§ '7, 8, <fe 9 of the Act of May 14, \SiO, post (Laws 1840, chap, 
363, p. SOI). See this act, post. 



90 SPECIAL STATUTES APPLICABLE TO 

proceed to sell at public auction the public stocks so 
pledged, or the bonds and mortgages so assigned, or any or 

Proceeds, 

a°Tied.''° either of them, and out of the proceeds of such sales shall 
pay and cancel the said bills or notes, default in paying 
which shall have been made as aforesaid ; but nothing in 
this act contained shall be^considered as implying any 
pledge on the part of the State for the payment of said bills 
or notes, beyond the proper application of the securities 
pledged to the comptroller for their redemption. 
Securities ^ ^^' '^^ public debt and bonds and mortgages to be 

'"xchisfvoiy ' deposited with the comptroller by any such person or asso- . 

notes. elation, shall be held by him exclusively for the redemp- 
tion of the bills or notes of such person or association put 
in circulation as money, until the same are paid. 
Theeomp- § 13. The plates, dies, and materials to be procured by 

troller to 

keep in his the Comptroller for the printing and making of the circula- 
bank plates, ^.-^^g notcs provided for hereby, shall remain in his custody 
and under his direction ; and the expenses necessarily in- 
curred in executing the provisions of this act shall be aud- 
ited and settled by the comptroller, and paid out of any 
moneys in the treasury not otherwise appropriated ; and 
for the purpose of reimbursing the same, the said comp- 
troller is hereby authorized and required to charge against 
and receive from such person or association applying for 
such circulating notes, such rate per cent, thereon as may 
be sufficient for that purpose, and as may be just and rea- 
sonable. ( 35 ) 

(86) By a ooncuiTent resolution of the Senate and Assembly of March 
4th, 1852, it is made the duty of the superintendent of the Banking Depart- 
ment, whenever any bank, banking association, or individual banker shall 
give notice of an intention to discontinue the business of banking, — to de- 
stroy or cause to be destroyed, all plates and impressions belonging to such 
bank, banking association, or individual banker. (Laws of 1852, p. YSl.) 



BANKING CORPORATIONS. 91 

§ li. It shall not be lawful for the comptroller, or other comptroi- 

" ^ ler not to 

officer, to countersign bills or notes for any person or asso- wtoleyond 
ciation of persons, to an amount in the aggregate exceeding 
the public debt, or public debt and bonds and mortgages at 
their value, as provided in the second section of this act, 
deposited with the comptroller by such person or associa- 
tion ; and any comptroller or other person who shall vio- 
late the provisions of this section, shall, upon conviction, be 
adjudged guilty of a misaemeanor, and shall be punished 
by a fine not less than five thousand dollars, or be impris- for a"ioia- 

tionofthis 

oned not less than five years, or by both such fine and section. 
imprisonment. (35^) 

§ 15. Any number of persons may associate to establish cobpoea- 

" •' i. .1 TI0H8, how 

offices of discount, deposit, and circulation, upon the terms'"™^*- 
and conditions, and subject to the liabilities prescribed in 
this act ; but the aggregate amount of the capital stock of 
any such association shall not be less than one hundred 
thousand dollars. (36) 



(S5iS) It will be perceived, that the Smt fourteen sections of the General 
Bank Act, relate exclusively to provisions and regulations for the creation 
and government of the issue department, and the State Officer, who is con- 
stituted its sole manager, including special directions as to the custody of the 
bank plates, and the penalties imposed upon the comptroller or superintend- 
ent (Laws 1851, chap. 164, p. 309, § 8), for any violation of such regulations. 
In 1843, the legislature compelled every safety fund bank to deposit with 
the comptroller their bank plates, and made it the duty of that officer safely 
to keep the same. (Laws 1843, p. 299.) See Constitution of 1846, Art. 8, 
§ 6,— and § 8 of the Act of April 12, 1851 (Laws 1851, chap. 164, p. 309). 



(36) By § 2 of the Act of May 14th, 1840 (Laws 1840, chap. 363, p. 306), 
it was enacted that no association of persons " shall commence the business 
of banking, &a., until such association shall have deposited with the comp- 
troller the securities required by law, to the amount of $100,000." By § 1 
of the Act of May 6th, 1844 (Laws 1844, chap. 281, p. 416), it was enacted 
that no individual banker shall commence the business of banking, or receive 



92 SPECIAL STATUTES APPLICABLE TO 

tom'ake"°™ § ^ 6. Such persons, under their hands and seals, shall 
certiflcEte. j^g^^jg ^ certificate which shall specify,— 
Contents 1. The name assumed to distinguish such association, 

of the certia- ° ' 

'^'^- and to be used in its dealings. 

2. The place where the operations of discount and de- 
posit of such association are to be carried on ; designating 
the particular city, town, or village. (37 ) 

circulating notes, until suoli individual bajfeer " shall have deposited with 
the comptroller the securities required by law, to the amount of $50,000." 
See Act of April 18, 1848, § 1 (Laws 1848, chap. 340, p. 462). 

(31) In all special Bank Charters granted in this State, prior to the en- 
actment of the General Banking Law, the location of each bank was fixed 
by its charter, and each bank was prohibited from carrying on its opera- 
tions of discount and deposit elsewhere than at the place so designated. 

See Session Laws, 181Y, p. 207, § 1, Bank of Plattsburgh. 
" 1818, p, 246, § 1, Cherry Valley Bank. 

1825, p. 198, § 1, Commercial Bank of Albany. 
" 1829, p. 538, § 1, Canal Bank of Albany. 

§ 1 of every safety fund banjc charter, from 1829 to 1838, is in one unva- 
rying form as follows : " There shall be established [in the village of Bata- 
Tia, and county of Genesee, a bank to be called " The Bank of Genesee,"] 
whose operations of discount and deposit shall be carried on [in the village 
of Batavia] and not elsemhere." See Charters of Safety Pund Banks, § 1, in 
Session Laws, from 1829 to 1838. 

The New York Dry Dock Company was authorized by its charter to em- 
ploy |200,000 of its capital in banking operations in the tenth ward of the 
city of New York. (Laws 1825, chap. 114, § 8, p. 180.) In 1829, a special 
Act was passed, granting that bank permission to establish' an office of dis- 
count and deposit -m any part of the city of New York. (Laws 1829, chap. 
295, p. 427.) 

The legislature, by special acts, authorized "The Exchange Bank of 
Genesee," " Farmers and Mechanics' Bank of Genesee," and the " New York 
and Erie Bank," — all associations under t}i£ general law of 1838, — to change 
their respective places of business. (Laws 1848, chap. 82, p. 90 ; Laws 1850, 
chap. 8, p. 13 ; Laws 1852, chap. 95, p. 109 ; and Laws 1854, chap. 36, p. 97.) 
See also, " An Act to authorize the Sackett's Harbor Bank to change its 
place of business" (Laws 1852, chap. 94, p. 108). See also, " An Act to au- 
thorize the stockholders of the Camden Bank to amend their articles of asso- 
ciation" (Laws of 1855, chap. 34, p. 43). By the Act of May 6th, 1844 
(Laws 1844, chap. 281, p. 416, § 3), every individual banker was required to 
file in the comptroller's office a certificate stating the town, city, or village 



BANKING COKPORATIONS. 93 

3. The amount of the capital stock of such association, 
and the number of shares into which the same shall be 
divided. (37) 

4. The names and places of residence of the sharehold- 
ers, and the number of shares held by each of them re- 
spectively. ( 37 ) 



in which he resides; and this act 'declared it unlawful for such individual 
banker to " trarisact business " under the General Bank Act, " at any other 
place than that in which he resides." 

By the Act of April 12th, 1848 (Laws 1848, chap. 340, p. 462, § 1), it 
was enacted, that " all banking associations or individual bankers," organ- 
ized under the general banking law, " shall be banks of discount and deposit, 
as well as of circulation, and the usual business of banking of said associations 
or individual banker, shall be transacted at the place where such banking 
associations or individual banker shall be located, agreeable to the location 
specified in the second clause of § 16 of the Act passed April 18th, 1838, 
hereinbefore mentioned, and not elsewhere ;" and by this act each association 
and every individual banker is required, in every report, to state, that " the 
business of said association or banker has been transacted at such locatioii" 

By the Act of April 15th, 1854 (Laws 1854, chap. 242, p. 551, §§ 1, 2, 3), 
it is made the duty of the agent or person (designated by the superintendent 
of the banking department to examine the affairs of banking associations and 
individual bankers), to " inquire whether any banker transacts the business 
of banking at the city, town, or village where the circulating notes of such 
individual banker purport to have been issued and dated, and wheiher any 
bank or banking association transacts the business of banking at ihe place 
designated in its charter or certificate of association ;" and sueh person or 
agent is clothed with power to summon any inhabitant of the county in 
which he may be conducting the inquii-y, to appear before him and testify 
in relation to the same ; and if the party so summoned shall refuse to an- 
swer, &c., he shall forfeit $100, and may be committed to tlie jail of the 
county, there to remain in close custody, until he shall submit to answer, 
&c. ; and in case it shall appear from sueh examination that any bank, bank- 
ing association, or individual banker is in an unsound or unsafe condition 
to do banking business, " or that the business of banking is not transacted by 
such bank, banking association, or individual banker at the plac- where said 
cireulating notes are dated and purport to be issued," Ac, — then said supenn- 
tendent is required to withhold and refuse to issue or deliver any registered 
notes to 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 condi- 
tion to do banking business, and that the business of banking is transacted by 
such bank, association, or banker, at the place where their circulating notes 



94: SPECIAL STATUTES APPLICABLE TO 

5. The period at wbicli such association shall commence 
and terminate ; which certificate shall be proved or ac- 
knowledged, and recorded in the office of the clerk of the 
county where any office of such association shall.be estab- 
lished, and a copy thereof filed in the office of the secretary 
of state. 

Certificate § 17. The Certificate required by the last preceding sec- 
rec.^rdedana^jQjj^ to be recordcd and filed in the offices of the clerk of 
the county and secretary of state 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. ( 38 ) 

mupms 8 18. Such association shall have power to carry on the 

pmo6ra of j. tt 

corporations, ijusiness of banking, by discounting bills, notes and other 
evidences of debt ; by receiving deposits ; by buying and 
selling gold and silver bullion, foreign coins and bills of 

are dated, and purport to be issued." See the several acts above referred to, 
post. 

Tlie safety fund banks were expressly authorized to carry on the business 
of banking, "by issuing bills, notes, and evidences of debt," payable on de- 
mand. But the legislature not only determined the number, but fixed by 
their charters, the amount of the capitals of each of these banks ; and the 
amount so fixed could not be increased without the consent of the govern- 
ment. 

By § 16 of the General Bank Act, the legislature of 1838, not only au- 
thorized the organization of an indefinite number of banking corporations, 
but empowered each to have an original capital of $100,000,000, or any 
other sum (above $100,000) with power to increase it at pleasure (§ 20). 
But we have seen, that these banking corporations are only authorized (§ 8) 
to loan and circulate as money such secured promissory notes, payable on 
demand, as they shall "receive from the comptroller," and these must bear 
upon their face the countersign, of that State officer, and the stamp of the 
government of the State. See note 39, post. 
♦ ■ ' ~ 

(38) By the Act of April 10th, 1864 (Laws 1854, chap. 186, p. 442, § 1), 
all certificates of association, under the general banking law, are to be " filed 
in the office of the superintendent of the banking department." See this 
act, post. 



BANKING CORPORATIONS. 95 

exchange, in tlie manner specified in their articles of asso- 
ciation for the purposes authorized by this act ; by loaning 

11 1 • 11 • • Express 

money on real and personal security ; and by exercising powers. 
such incidental powers as shall be necessary to carry on 
such business ; J;o choose one of their number as president 
of such association ; and to appoint a cashier, and such 
other officers and agents as their business may require, and and'^caswer. 
to remove such president, cashier, officers and agents at 
pleasure, and appoint others in their place. (39) 

(89) Among the express po-wers granted to banking associations by § 18, 
the faculty or power of issuing their own engagements or promises, is not 
mentioned. The terms of this section are restrictive. The particular Hnds 
or branches of banking are specified. " The subjects pertaining to the busi- 
ness of banking," says Gardiner, J., in State of Ohio t. Tell (3 Selden, 328, 
344), "are designated, and the express powers of the associations are lim- 
ited to them, and to such incidental powers as may be necessary to transact 
the business thus defined by the legislature." 

The express powers specified in § 18, are in the exact language of § 3 or 
§4 of every Safety Fund Bank Charter, with two important exceptions: 
one exception is, that the power, — expressly granted to all the special charter 
banks incorporated after 1824, — to carry on tJie business of banking "by 
issuing bills, notes, and other evidences of debt," — is withheld from corporations 
formed under the general law; and in the place of the words, " by issuing 
bills, notes, and other evidences of debt," are substituted these words (not 
found in any special charter), "by loaning money on real and personal 
security." The second exception is, that the general power, — " to buy and 
sell gold and silver bullion, foreign coins, and bills of exchange," found in 
every specw^ bank charter after 1824,— ris qualified in the 18th section of 
the General Law, by the addition of these words, — " in the manner specified 
in their Articles of Association, for the purposes authorized by this act," — 
thus delegating to the associates themselves, the right, by their articles, to 
restrict, regulate, limit, or qualify the exercise of this particular power. 

EXPKESS POWERS OF A SAFETY FUND BANK. 

" § S. The said corporation shall have power to carry on the business of 
banking, by discounting bills, notes, and other evidences of debt: by re- 
ceiving deposits; by buying and selling gold and silver bullion, foreign 
coins, and bills of exchange ; by issuing bills, notes, and other evidences of 
debt ; and by exercising such other incidental powers, as shall be necessary 
to carry on such business," — (Charter of the Oswego Bank, Laws 1831, p. 
11, § 3. See all the charters of the same class of banks, § 3 or § 4.) 

The words in italics are omitted in the above, 18th, section. The third 



vo SPECIAL STATUTES APPLICABLE TO 

be^prasonS § 1^- '^^^ sLares of said association shall be deemed 
how to^7 personal property, and shall be transferable on the books 

transferred. ^ x i ./ ; 

section contaias the only express authority, granted by the general law, to 
moneyed corporations formed under it to issue any bUl, note, or,"eTidence of 
debt, of such corporation, — ^but the authorized bills or n^tes are to be " re- 
ceived from the comptroller," who is required to have on hand such a quan- 
tity as shall be " necessary to carry into effect the provisions of this act." And 
it is further declared, that the " plates, dies, and materials," employed by 
the comptroller in making the authorized notes, " shall remain in his custody 
and under Mk control " — (§§ 2, 3, 13, of the General Bank Act). 

By § 3 associations and individual bankers are authorized to loan and 
circulate as money, according to the ordinary course of banking business, as 
regulated by the laws and usages of this State, a certain kind of promissory 
notes ; but these notes must be issued by the State officer having exclusive 
charge of the issue department, — be countersigned by him, — secured by 
ample pledges of government securities, Ac, in his office, — and must be 
made payable on demand at the place of business, within this State, of such 
person or association," (§§ 1, 2, 3, of the General Bank Act ; see also, the 
prohibitions in §§ 3, 6, 10 & 11, in the Restraining Act of 1830, pp. 41, 42 
cfe 48, ante ; also, notes 14, 15, & 16, pp. 38-48, ante, and the cases there cited: 
also, note ii\,post, and the cases there cited. 



In October, 1839, the Supreme Court, in Thomas v. Dakin (22 Wend. 
9-112), held, — that associations under the General Banking Law of 1838 
are corporations, and that said law was valid and constitutional on the as- 
sumption that it received the assent of two thirds of the members elected to 
_ each branch of the legislature. The same point was subsequently adjudged 
by the Supreme Court in Warner v. Beers, and Bolander v. Stevens ; see also 
Bank of Watertown v. Assessors, &c., of Watertown (26 Wend., 686) ; De 
Bow V. The People (1 Deuio, 9) ; Willoughhy v. Oomstock (3 HiU, 389) ; and 
The People v. Supervisors of Niagara (4 Hill, 20). 

But in April, 1840, the judgments of the Supreme Court in Warner v. 
Beers, and Bolander v. Stevens, were reversed by the Court for the Correc- 
tion of Errors, (23 Wend. 103-190). This court, in these two cases, held, 
(1) That the law entitled " An act to authorize the business of banking," 
passed April 18th, 1838, is valid and constitutionally passed, although it 
may not have received the assent of two-thirds of the members elected to 
each branch of the legislature ; and also held, (2) That associations organ- 
ized in conformity to the provisions of said act, " are not bodies politic or 
corpoi'ate within the spirit and meaning of the constitution," of 1821. See 
also Oifford v. Livingston (2 Denio, 280-402.) 

In December, 1844, in Supervisors of Niagara v. The People ("7 HUl, 804- 
518), the Court of Errors held, that associations under the general banking 
law are corporations within the meaning of 1 R. S., 414, §1, and liable to 



BANKING CORPORATIONS. 97 

of the association in such manner as may be agreed on in 
the articles of association ; and every person becoming a 
shareholder by such transfer, shall in proportion to his 



taxation on their capitals ; and aj£rmed the judgment of the Supreme Court 
in the same case. 

In July, 1850, in Gillett, Receiver, v. Moody (3 Comstoot, 479-488), the 
Court of Appeals held, that associations under the general banking law are 
moneyed corporations, and as such, are within the provisions of the revised 
statutes (1 R. S., 5S9), "to prevent the insolvency of moneyed corporations, 
and to secure the rights of their creditors and stockholders" 

In October, 1852, in TaLmnge v. Pell (3 Selden, 328-348), the Court of 
Appeals finally adjudged as follows : 

" 1. That every association organized under the act to authorize the 
business of banking, and the Act amending the same, is a moneyed corpora- 
tion within the meaning of the statutes of this State relating to moneyed 
corporations ; and is bound and affected by those statutes, excepting only so 
far as such statutes are inconsistent with the provisions, either of the act to 
authorize the business of banking, or of the acts amending the same. 

" 2. That such associations are banking corporations, and possess only au- 
thority to carry on the business of banking in the manner and with the 
powers specified in the said act. That they have no power to purchase State 
or other stocks for the purpose of selling them for profit, or as a means of 
raising money, except when such stocks have been received in good faith, as 
security for a loan made by or a debt due to such association, or when 
taken in payment, in whole or in part, of such loan or debt." (3 Selden, 
347, 348.) 

The case of Talmage v. Pell was twice argued before the Court of Ap- 
peals; in the July term of 1851, held at Elmira ; and in the April term of 
1862, held at Albany. 

In delivering the judgment of the Court of Appeals, in July, 1850, in 
Gillett V. Moody (3 Comst, 479, 485), Bbonson, Ch. J., said, — " That these as- 
sociations are corporations, and " moneyed corporations," has been directly 
and expressly adjudged by the highest courts in the State. They are not 
corporations in a qualified sense, as within the intent and meaning of some 
particular statute ; but are corporations to all intents and purposes. If any 
thing can be settled by judicial decisions, this is settled." See also The 
Bank Commissioners v. The St. Lav/rence Bank (3 Selden, 513). 



That a corporation must show a grant in terms, or by necessary implica- 
tion, for every power it attempts to exercise. See 1 R. S. 600, § 3, and 
Note 11, p. 25, ante, and the cases there cited; also, notes 19, 20, & 21, 
pp. 51-57, ante, and the cases there cited. 
7 



98 SPECIAL STATUTES APPLICABLE TO 

shares, succeed to all the rights and liabilities of prior 
shareholders ; and no change shall be made in the articles 

No change .ti.ii«i j* •« 

in Articles, of association by which the rights, remedies or security oi 



&c, 



Articles 
may provide 



its existing creditors shall be weakened or impaired. Such 
association shall not be dissolved by the death or insanity 
of any of the shareholders therein. 

§ 20. It shall be lawful for any association of persons 
for inoreMe^ Organized under this act, by their articles of association, to 

of capital. , , 

provide for an increase of their capital, and of the number 
of the associates, from time to time, as they may think 
proper. 

S 21. Contracts made by any such association, and all 

•Contracts ° ■/ J ' 

^gned ^^ notes and bills by them issued, and put in circulation as 

money, shall be signed by the president or vice-president 

and cashier thereof ; and all, suits, actions and proceedings 

Actions brought or prosecuted by or on behalf of such association, 

brooghtin may be brought or prosecuted in the name of the president 

name of the ■' ox. i. 

president, tjjereof ; and no such suit, action or proceeding shall abate 
by reason of the death, resignation or removal from ofSce 
of such president, but may be continued and prosecuted 
according to such rules as the courts of law and equity may 
direct, in the name of his successor in office, who shall ex- 
ercise the powers, enjoy the rights, and discharge the duties 
of his predecessor. ( 40 ) 



(40) In July, 1850, in delivering the judgment of the Oourt of Appeals, 
in Gillett T. Moody (3 Comst. 479, 485, 486), Bkonson, Ch. J., said,—" There 
was a difference of opinion between the Supreme Court and the Court of 
of Errors on the question whether the comstitiUion applied to the free bants 
— the Supreme Court holding that it was applicable alike to all corpora- 
tions, while the Court of Errors thought it applied only to corporations cre- 
ated by special charter, and not to those formed under general laws. But both 
courts were agreed that the free banks are corporations. If there was room for 
a doubt on this point after the decision of the Court of Errors in Warner v, 
Beers (23 Wend., 103), the decision of the same court in The Supervisors of- 



BANKING CORPORATIONS. 99 

§ 22. All persons having demands against any such Actions 

. . * . T , -, inav be 

association, may maintain actions against the president maintained 
thereof ; which suits or actions shall not abate by reason Suf 'to™ bate 
of the death, resignation or removal from office of such &o. 
president, but may be continued and prosecuted to judg- 
ment against his successor ; and all judgments and decrees 
obtained or rendered against such president for any debt 
or liability of such association, shall be enforced only 
against the joint property of the association, and which 
property shall be liable to be taken and sold by execution 
under any such judgment or decree. ( 40 ) 

§ 23. No shareholder of any such association shall be share- 
holders not 
liable in his individual capacity for any contract, debt, or^^'™"^^^ 

engagement of such association, unless the articles of asso- *°' 



Niagara v. The People {1 Hill, 804), removed all ground for snch a doubt. 
And yet I notice that some of the free banks still keep up a practice which 
was adopted when it was thought necessary to keep up some such device to 
get round the constitution, and add the name of the president to the corpo- 
rate name of the institution, in bringing suits. It was long since held that 
this was unnecessary, and that the free banks might sue and be sued in the 
same corporate name which is used in transacting their other business. The 
People V. TTie Assessors of Waterlown (1 Hill, 621). And as it is now settled 
that the free banks have a legal existence, it may be hoped that the incon- 
venient practice of using the name of the president in bringing suits by and 
against the corporation mil be given up." (3 Comst., 485, 486.) 

Since the case of Oillett v. Moody, the Court of Appeals has decided the 
case of Talmage v. Pell (3 Selden, 328, 347, 348), and has again adjudged 
" that, every association, organized under the act to authorize the business of 
banking, and the acts amending the same, is a moneyed corporation.'' (3 Sel- 
den, 347.) As to the mode of bringing suits by and against associations 
linder the general law, see, also, Belafield v. Kinney (24 Wend., 345); and 
Case V. The Mechanics' Banking Association (1 Sand., Sup. R., 693). 

In March, 1841, while the difference of opinion, alluded to by Judge 
Beonsos, existed between the Supreme Court and the Court of Errors, and 
before the decision by the latter Court of the case of The Supervisors of Ni- 
agara V. The People, the legislature passed the act entitled "An Act respect- 
ing suits and legal proceedings by or against banking associations." (Laws 1841, 
chap, 56, p. 33.) See this act, post. 



100 SPECIAL STATUTES APPLICABLE TO 

ciation by him signed shall have declared that the share- 
holder shall be so liable. ( 40 J ) 
Provisions 8 24. It shall be lawful for such association to purchase, 

lis to Meal ^ 

Estate. Jjq1(J ajj^ convey real estate 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, by 
way of security for loans made by or moneys due to such 
association ; or 

3. Such as shall be conveyed to it in satisfaction of 
debts previously contracted in the course of its dealings ; or 

4. Such as it shall purchase at sales under judgments, 
decrees or mortgages held by such association. ( 41 ) 

(40-J-) See the Act of April 6th, 1849, entitled, "An Act to enforce the re- 
sponsibility of stockholders in certain hanking corporations and associations, 
as prescribed by the constitution, and to provide for tlie prompt payment of de- 
. mands against such corporations and associations." (Laws 1849, chap. 226, p. 
340.) The eleventh section of this act, amended by the act of March 15th, 
1855. (Laws 1856, chap. 69, p. 101.) See these acts, joos^. 

(41) The following is the 4th section of a Safety Fund Bank Charter : 

" § 4. The real estate which it shall be lawful for the said corporation to 
purchase, hold, and convey, shall be, 

" 1. Such as shall be requisite for its immediate accommodation in the 
convenient transaction of its business ; or, 

" 2. Such as shall have been mortgaged to it in good faith by way of se- 
curity for loans previously contracted, or for moneys due ; or, 

" 8. Such as shall have been conveyed to it in satisfaction of debts pre- 
viously contracted in the course of its dealings ; or, 

" 4. Such as shall have beenpurohased at sales upon judgments, decrees, 
or mortgages obtained or made for such debts. The said corporation shall 
not purchase, hold, or convey real estate in any other case, or for any other 
purpose. (See the charter of The Onondaga County Bank, Laws 1830, p. 
1T4, § 4; Laws 1829, p. 326, § 6; Laws 1831, p. 71, § 4.) 



The Chautauque County Bank (an institution under the Safety Fund sys- 
tem) being prohibited by its charter from purchasing, holding, or conveying 
real estatp, except in certain specified cases, as above stated, it was lield, that 
said bank had no capacity after the time for redeeming had expired, to pur- 
chase the interest of a judgment creditor who, by virtue of his own judg- 
ment, had acquired the title of the purchaser of land sold under execution, 



BANKING CORPORATIONS. 101 

The said association shall not purchase, hold, or convey prohibition. 
real estate in any other case or for any other purpose ; and 
all conyeyances of such real estate shall be made to the 
president, or such other officer as shall be indicated for 
that purpose in the articles of association ; and which pres- 
ident or officer, and his successors, from time to time, may 
sell, assign and convey the same free from a,ny claim there- 
on, against any of the shareholders, or any person claiming 
under them. 

§ 25. Upon the application of creditors or shareholders ohanceiior 
of any such association, whose debts or shares shall amount examinatioD, 
to one thousand dollars, and stating facts, verified by affi- 
davit, the chancellor may, in his discretion, order a strict 
examination to be made by one of the masters of his court, 
of all the affairs of such association, for the purpose of as- 
certaining the safety of its investments, and the prudence 
of its management ; and the result of every such examina- 
tion, together with the opinion of the master and of the 
chancellor thereon, shall be published in such manner as 
the chancellor shall direct, who shall make such order in 
respect to the expenses of such examination and publica- 
tion, as he may deem proper. ( 42 ) 

though the bank had unsatisfied judgments against the debtor whose land 
had been sold. The Chautauque County Bank v. Risley (4 Denio, 480). See, 
also, Russell v. Topping (6 McLean, 194). 

By § 4 of the act of April 10, 1849 (Laws 1849, chap. 313, p. 455), it is 
provided, that an association formed to take the place of an incorporated 
bank whose charter has expired, may hold, in addition to the real estate 
as prescribed in the above § 24, such other real estate as, at the time of the 
transfer of the property of the incorporated bank, it had received in pay- 
ment of debts previously contracted, or had purchased under judgments, &e. 



(42) See § 3 of the Act of May 26th, 1841 (Laws 1841, chap. 319, p. 
309); also, § 3 of the Act of December, 4th, 1847 (Laws 1847, chap. 419, 
p. 621). 



Contents 
of hepurt. 



102 SPECIAL STATUTES APPLICABLE TO 

semi-an- § 26. Such association shall, on the first Mondays of 

DMl Keporta '' 

to^eomptroi January and July in every year, after having commenced 
the business of banking, as prescribed by this act, make 
out and transmit to the comptroller, in the form to be pro- 
vided by him, a full statement of the affairs of the associa- 
tion, verified by the oath of the president or cashier, which 
statement shall contain : — ( 43 ) 

1. The amount of the capital stock paid in according to 
the provisions of this act, or secured to be paid. 

2. The value of the real estate of the association ; speci- 
fying what portion is occupied by the association as neces- 
sary to the transaction of its business. 

3. The shares of stock held by such association, whether 
absolutely, or as a collateral security ; specifying each kind 
and 'description of stock, and the number and value of the 
shares of each. 

4. The amount of debts due to the association ; specify- 
ing such as are due from moneyed or other corporations, or 
associations ; and also specifying the amount secured by 
bond and mortgage or judgment ; and the amount which 
ought to be included in the computation of losses. 



(43) This section repealed by § 5 of the Act of May 26th, 1841 (Laws 
1841, chap. 319, p. 309); and new sections substituted in place of §26. 
See the Act of May, 26th, 1841, §§ 1, 2, 3, 4, 5, post. By this act the an- 
nual statements were required to be made to the Bank Commissioners, 

April 18th, 1843, the legislature abolished the office of Bank Commis- 
sioner, and required every banking association to make quarterly reports to 
the comptroller. (Laws 1843, chap. 218, p. 300, 801, §§ 3, 4, 5, 6). See, 
also, § 2 of the Act of May, 6th, 1844 (Laws 1844, chap. 281, p. 416); also, 
§ 1 and § 4 of the Act of December 4th, 1847 (Laws 1847, chap. 419, p. 
519); also, § 9 of the Act of April, 12, 1851 (Laws 1851, chap. 164, p. 309). 

By the Act of April 15th, 1853, all banks, banking associations, and 
individual bankers doing business in the city of New York, are required, in 
addition to quarterly reports, to publish wheMy statements, verified by the 
oath of the president or cashier. (Laws 1853, chap. 250, p. 639.) 



BANKING CORPORATIONS. 103 

6. The amount of debts due by sucb association ; spe- contents of 

Eeport. 

cifying such as are payable on demand, and such as are 
due to moneyed or other corporations or associations. 

6. The amount of claims against the association not ac- 
knowledged by it.as debts. 

7. The amount of notes, bills or other evidences of debt 
issued by such association. 

8. The amount of the losses of the association ; specify- 
ing whether charged on its capital or profits, since its last 
preceding statement, and of its dividends declared and 
made during the same period. 

9. The average amount in each month during the pre- 
ceding six months of the debts due to and from the associ- 
ation ; the average amount of specie possessed by the same 
during each month, and the amount of bills and notes is- 
sued by such association, and put in circulation as money, 
and outstanding against the association, on the first day of 
each of the preceding six months. 

10. The average amount in each month during the pre- 
ceding six months due to the association, from all the share- 
holders in the association, also the greatest amount due to 
the association in each of the said preceding six months 
from all the shareholders in such association. 

11. The amount which the capital of the association has 
been increased during the preceding six months, if there 
shall have been any increase of the said capital ; and the 
names of any persons who may have become parties to 
the said articles of association, or may have withdrawn 
therefrom since their last report. ( 44 ) 



(44) The subdivisions 1 to 11 under § 26, are substantially the same as 
§ 20 and § 21 (1 Revised Statutes, 692, 594), and the subdivisions there- 
under; see pp. 13, 14, 15, ante. The requirements of §§ 20, 21 (1 R. S., 693, 



104 SPECIAL STATUTES APPLICABLE TO 

Statements It shall be the duty of the comptroller to cause the state- 
to be pub- 1 T 1 

liBhed. menfc required to be made by this section, to be published 
in a newspaper printed in the county where the place of 
business of such association is situated, and in the State 
paper ; the expense of which shall be paid by such associa- 
tion. 
Penalty for § 27. If such association shall neglect to make out and 

neglect to . , . in. j- 

make out transmit the statement required in the last preceding sec- 

StfttBtOtCUCj 

*"■ tion, for one month beyond the period when the same is ' 

required to be made, or shall violate any of the provisions 
of this act, such association may be proceeded against, and 
dissolved by the court of chancery, in the same manner as 
any moneyed corporation may be proceeded against and 
dissolved. (45) 
Provision § 28. If any portion of the original capital of any such 

as to divi-^ 

(lends. association shall be withdrawn for any purpose whatever, 

whilst any debts of the association remain unsatisfied, no 

dividends or profits on the shares of the capital stock of 

the association shall thereafter be made, until the deficit- of 

Powe of capital shall have been made good, either by subscription 

chancellor. ^^ ^^^ shareholders, or out of the subsequently accruing 
profits of the association ; and if it shall appear that any 
such dividends have been made, it shall be the duty of 
the chancellor to make the necessary orders and decrees 
for closing the affairs of the association, and distributing 
its property and effects among its creditors and sharehold- 
ers. (45) 

594), were binding on all Safely Fund Banks. See charters of Safety Fund 
Banks. But see note 43, ante. 

(45) See § 39 on page 58, ante, and note 23 on page 59, ante; also § 5 
of the Act of May 4, 1840 (Laws of 1840, chap. 202, p. 154): also § 12 of 
the Act of May 14, 1840 (Laws 1840, chap. 863, p. s'OB): also § 3 of the 



BANKING CORPORATIONS. 105 

§ 29. Such association shall be liable to pay the holder Damages 

on protested 

of every bill or note put in circulation as money, the pay- ^"'"^ """>'**■ 
ment of which shall have been demanded and refused, 
damages for non-payment thereof, in lieu of interest, at 
and after the rate of fourteen percent, per annum, from 
the time of such refusal, until the payment of such evi- 
dence of debt, and the damages thereon. ( 46 ) 

§ 30. The president and cashier of every association Duties of 

president 

formed pursuant to the provisions of this act, shall at all and casMer. 
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 comptroller, on the first Mondays of January 
and July, in every year. 

§ 31. It shall not be lawful for any association formed BiUsiess 

" ■' than $1000, 

under the provisions of this act, to make any of its bills or ^°J^p°^"^^^^ 
notes of a denomination less than one thousand dollars to ciation."*' 
be put in circulation as money, payable at any other place 
than at the office where the business of the association is 
carried on and conducted. (47) 

Act of May J6, 1841 (Laws 1841, chap. S19, p. 308) : also, § 4 of the Act 
of April 1^ 1843 (Law 1843, chap. 218, p. 299): also, § 2 of the Act of 
December* 1847 (Laws 1847, chap. 419, p. 619): also, § 2 of the Act of 
April 15, 1863 (Laws of 1853, chap. 250, p. 539). See the foregoing acts, 
post. 

(46) See § 5 of the Act of May 4, 1840 (Laws 1840, chap. 202, p. 154): 
also, § 5 of the Act of April 18, 1843 (Laws 1843, chap. 218, p. 299): also, 
§ 1 of the Act of April 6, 1849 (Laws 1849, chap. 226, p. 340) : also, § 5 of 
the Act of April 17, 1851 (Laws 1851, chap. 203, p. 475), amending % 29 of 
the General Banking Law. 
— ^ 

(47) By § 3 of the General Banking Law, it is provided, that the bills 
or notes authorized to be issued by associations and individual bankers, 
shall be made "payable on demand at the place of business, within this 



on hand. 



106 SPECIAl STATUTES APPLICABLE TO 

§ 32. The legislature may at any time alter or repeal 
this act. 
as to^peiie § ^^* "^^ association of persons authorized to carry on 
the business of banking under this act, shall at any time, 
for the space of twentj^ days, have on hand at their place 
of business, less than twelve and a half per cent, in spe- 
cie, on the amount of the bills or notes in circulation as 
money. ( 48 ) 

State, of Buoh person or associations." By § 16 of the general law (see 
p. 92, ante), the only place of business required to be specified in the cer- 
tificate, is some "particular city, town, or village." Section 31, therefore, 
provides beyond this, that it shall not be lawful for any banking corpora- 
^ion^ organized under the general law, to make any of its bills or notes, of a 
denomination less than $1,000, to be put in circulation as money, payable 
at any other place than " at the office where the business of the associatioa 
is carried on and conducted." This provision, as to bank notes of all de- 
nominations, had been previously made by the Act of April 17, 1830 
(Laws 1830, chap. 243, p. 265. See p. 15, and note 26, p. 76, ante). 

By the Act of 1830, every note, bill, or other evidence of debt, purport- 
ing to be a bank note, " must be deemed and taken to be payable at the 
banking house of such' incorporated banking institution, any law or usage to 
the contrary thereof notwithstanding." In note 37 (p. 92, ante) are cited 
various acts of the legislature, passed subsequently to the general bank- 
ing law, confining and limiting the banking operations of associations and 
individual bankers, organized under it, to the place designated in their re- 
spective certificates; and also, to the place where their "circulating 
cotes are dated, and purport to be issued." 

(48) § 33 was repealed by § 6 of the Act of May 14, 1840t[Laws 1840, 
chap. 363, p. 306. See this act, post. 



BANKING CORPORATIONS. 107 

ACT OP MAY 7th, 1839. 

(LAWS 1839, CHAP. 365, P. 328.) 



An Act concerning Foreign Bank Notes. Passed 
May 7, 1839. 



The People of the State of New York, represented in 
Senate and Assembly, do enact as follows : 

§ 1. From and after the passage of this act it shall be Ecstrio- 

, . . _ _ tionasto 

unlawful for any incorporated banking institution within ^°l^ *'*"'' 
this State, and for any association, or any individual or in- 
dividuals, authorized to carry on the business of banking 
by virtue of the act entitled "An act to authorize the 
business of banking," passed the 18th day of April, 1838, 
to receive, pay out, give or offer 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 place, or by 
any person, association, or corporation within this State. 

§ 2. It shall not be lawful for any incorporated banking jjjgj,,gji„„ 
institution within this State, or any association, or any 
individual or individuals authorized to carry on the busi- 
ness of banking by virtue of the said act entitled "An act 
to authorize the business of banking," directly or indirectly 
to procure or receive from any corporation, association, or 
individual, situated or residing without this State, any 
bank bill or note, or other evidence of debt in the simili- 
tude of a bank bill or note, issued, or purporting to have 
been issued, by such last-mentioned corporation, associa- 



108 SPECIAL STATUTES APPLICABLE TO 

tion, or individual, with intent to issue and pay out, or in 
any way to utter or circulate the same as money, or to 
issue, pay out, or to utter or circulate the same, when pro- 
cured or received as aforesaid, as money. But nothing in 
this section contained shall prohibit the said banking insti- 
tutions, associations, and individual bankers, in the first 
part of this section mentioned, from receiving from their 
dealers and customers such foreign notes as are allowed 
by law to be circulated within this State in the regular 
and usual course of business, or from paying out the same 
when so received as last aforesaid. ( 49 ) 

Notes un- § 3. It shall uot be lawful for any incorporated banking 
institution within this State, or any association, or any in- 
dividual or individuals authorized to carry on the business 
of banking by virtue of the said act entitled "An act to 
authorize the business of banking," directly or indirectly 
to lend, or pay out fpr paper discounted or purchased by 
them, any bank bill, or note, or other evidence of debt 
which is not received at par by the said banking institu- 
tion, association, or individual, for debts due to, the said 
banking institution, association, or individual. 

Penalty. § 4. Evcry Corporation, and every association and indi- 
vidual authorized to carry on the business of banking, who 
shall offend against any of the provisions of the previous 
sections of this act, shall forfeit for each and every offence 
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 

(49) § 2 amended by § 1 of the act of April 13, 1853 (Laws 1853, chap. 
223, p. 428). See this act, post. 



BANKING CORPORATIONS. 109 

shall knowingly act or assist in any violation of any pro- 
vision of this act, shall, upon conviction, be deemed guilty 
of a misdemeanor, and shall be punished by fine or im- 
prisonment, or both, in the discretion of the court before 
which such conviction shall be had ; but such fine shall 
not exceed five hundred dollars, and that such imprison- 
ment shall not exceed six months. 

§ 5. This act shall take efiect immediately on its pas- 
sage. 



ACT or MAY 4th, 1840. 

(LAWS 1840, CHAP. 202, P. 154.) 



An Act relating to the redemption of ianJc notes. Passed 
May i, 1840. 



The People of the State of New Yorh, represented in 
Senate a/nd Assenibly, do enact as follows : 

§ 1. Every moneyed incorporation in this State having Agents to 
banking powers, and issuing bills or notes of circulation, iiTNewTork 
and every banking association and individual banker, car- 
rying on banking business under the act to authorize the 
business of banking, except those whose place of business 
is in the cities of New York, Albany, or Brooklyn, shall, 
on or before the first day of. July next, appoint an agent, 
who shall keep an office in the city of New York or Al- 
bany, for the redemption of all circulating notes issued 
by such corporation, banking association, or individual 



110 SPECIAl STATUTES APPLICABLE TO 

banker, which shall be presented to such agent for pay- 
ment or redemption.( 49^ ) 
^^^ § 2. Such agent shall be appointed in writing, and 

to brflie'^n such appointment in writing shall be delivered to the 

lers ofBce. comptroller on or before the day above mentioned, and 
filed in his ofBce ; and any corporation having banking 
powers, banking association, banker, or other person, may 
be an agent for the purposes of this act ; and if any such 
incorporation, association, or banker, shall omit to appoint 
such agent within the time above mentioned, the comp- 
troller shall appoint such agent for such corporation, asso- 
ciation, or banker. 
List of § 2- "^^^ comptroller, immediately after the said first 

puwished. ° day of July, shall publish, during such time as he may 
deem proper, a list of such agents in the state paper, and 
in at least two daily newspapers in the city of New York, 
the expense whereof shall be paid by the corporation, as- 
sociations, and bankers above mentioned. 

§ 4. It shall be the duty of every such corporation, , 

redeemed, 'banking association, and individual banker, out of the 
cities of New York, Albany, and Brooklyn, to redeem and 
pay on demand all circulating notes issued by such corpo- 
ration, banking association, or individual banker, pre- 
sented for redemption or payment at the oifice of their 
said agent in the city of New York or of Albany, at 
a rate of discount not exceeding one half of one per 
cent.(4H) 

§ 5. Every such corporation, banking association, or 

for neglect individual banker, whose agent shall neglect or refuse to 
redeem their notes on demand as aforesaid, shall pay to 

(49i) § 1 and § 4 of this act amended by §§ 1 and 2 of tine act of April 
11, 1851 (Laws 1851, chap. 203, p. S16). See this aet,post. 



BANKING CORPORATIONS. Ill 

the person making such demand, interest upon the notes 
so demanded, at the rate of twenty per cent, per annum ; 
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 association, or 
individual banker shall be liable to be piroceeded against 
by the bank commissioners, in the same manner, and with 
the like effect as any incorporated bank may be proceeded 
against for a violation of its charter ; and such corporation, 
banking association, or individual banker, shall not there- 
after issue, or put in circulation any of their bills or notes ; 
and the comptroller shall, in that case, proceed in the 
same manner as is directed in the fourth section of the act 
entitled " An Act to authorize the business of banking," 
passed April 18, 1838. 

8 6. Every association and individual banker who shall . , , 

" *' Agents to 

hereafter commence business under the act to authorize ^y^'^'J^^a^o* 
the business of banking, shall upon first receiving any cir- 
culating notes from the comptroller, appoint an agent for 
the purposes of this act, and be subject in all respects to 
the provisions of this act ; and the comptroller is hereby 
directed not to deliver any circulating notes to such asso- 
ciation or banker, until such appointment is made and 
filed in his office ; and such appointment shall be immedi- 
ately published by the comptroller in manner aforesaid. 

§ 7. Appointments of agents made in pur.suance of this Appoint- 
ments may 

act, may be revoked, and new appointments of Hgents may "* "™''"'- 
be made, from time to time, by delivering such revocation 
and appointment to the comptroller, who shall cause the 
same to be published as aforesaid. 

§ 8. It shall be lawful for any number of incorpoiated a namber 

u of banks may 

banks, banking associations, and private bankers, by agree- cSmmon* 

agent. 



112 SPECIAL STATUTES APPLICABLE TO 

ment, to associate together for raising a joint fund to be 
placed in the hands of their common agent, for the re- 
demption of their circulating notes in the city of Wew 
York or Albany, and also the circulating notes of other 
incorporated banks, banking associations, and individual 
bankers, in such 'manner, and under su6h regulations, as 
may be agreed upon, and to employ such agents and clerks 
as they may deem necessary to carry on the business of 
such common agency ; but nothing in this section con- 
tained shall authorize the redemption or purchase by such 
agency of any circulating notes at a discount of more than 
one-half of one per cent., nor to relieve or discharge such 
incorporated bank, banking association, or individual 
banker, from any duty or liability required or imposed by 
this act. 
Saving § ^- Nothing in this act contained shall be so construed 

as to authorize any incorporated bank, banking association, 
or individual banker, to purchase, buy in, or take up, di- 
rectly or indirectly, their circulating notes at 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. 



BANKING CORPORATIONS. 113 



ACT OF MAY 14th, 1840. 



(LAWS 1840, CHAP. 363, P. 306.) 



An Act to rnnend the Act entitled " An Act to authorize 
the hismess of £'cmkmg," Passed May IMh, 1840. 



The People of the State of New Yor\ represented in 
Senate and AssenMy, do enact as follows : 

§ 1. The second section of tte act entitled " An Act to t^K^"' 
authorize the business of Banking," passed April 18th, ^vedbvthe 

, ., ,, comptroller. 

1838, IS hereby amended, so as to read as follows : When- 
ever any person, or an association of persons, formed for the 
purpose of banking, under the provisions of this act, shall 
lawfully transfer to the comptroller any portion of the pub- 
lic 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. 

§ 2. The provisions of the said second section shall not ^^"^^^1-^^' 
be construed to prevent the stocks now held by the comp-compiioiie/ 
troUer under the act hereby amended, from being hereaf- 
ter transferred to, and received by him at their market 
value in the same manner as though this act had not been 
passed. 

8 



and 
interest. 



114: SPECIAL STATUTES APPLICABLE TO 

Account of 8 3. No association of persons stall commence the 

Becarities to ^ 

be deposited, 'buginess of banting under the said act, until such associa- 
tion shall have deposited with the comptroller the securi- 
ties required by law, to the amount of one hundred thou- 
sand dollars. ( 50 ) 
Notes to 8 4. If o banking: association or individual banter, as 

be payable <3 & ^ ' 

f^thottt such, shall issue or put in circulation any bill or note of 
said association or individual banker, unless the same shall 

Penalty. })q made payable on demand and without interest ; and 
every violation of this section by any oflBcer or member of 
a banking association, or by any individual banter, shall 
be deemed and adjudged a misdemeanor, punishable by 
fine or imprisonment, or both, in the discretion of the court 
having cognizance thereof. (51) 

(50) § 3 amended by § 1 of the Act of May 6, 1844 (Laws 1844, chap. 
281, p. 416). See this act, pos*. 

(51) See § 1 of the act of April 10, 1850 (Laws 1850, chap. 251, p. 486), 
amending § 4. See this act, post. 

In December, 1839, the case of Safford v. Wychoff, President of the 
Farmers' Bank of Seneca County, was tried, before Ccshman, Ciretiit Judge. 
This was an action against that bank as the drawer of a negotiable bill or 
draft for $3,000, dated August 15, 1839, and payable thirty days after date, 
and signed "/. J. Fenton, Cashier." The bank was an association, formed 
under the general banking law of 1838. It was objected on the trial, among 
other things, that the bank " had no power to issue drafts on time, or any 
other paper except such as had been countersigned according to law." These 
objections were overruled by Cushman, Circuit Judge, who directed a verdict 
for the plaintiff, which the jury rendered. (1 Hill, 12.) 

In Apx-il, 1840, the Court for the Correction of Errors, in Warner v. Beers 
(23 Wend., 101-190), held, that " associations organized in conformity with 
the provisions" of the general banking law, were " not bodies politic or cor- 
porate within the spirit and meaning of the constitution" of 1821. But Sen- 
ator Verplanck (who insisted in this ease, in opposition to the chancellor 
and to other senators, that these associations were, in no sense, corporations, 
but merely partnerships, relieved by a conditional repeal from the inhibitions 
of the general Restraining Act), held, that " certain conditions are imposed 
to entitle them to the benefit of this conditional repeal. They can isme no 
paper, unless it be secured in a certain w^JPand duly attested by the comp- 



BANKING CORPOEATIONS. 115 

§ 5. It shall be the duty of the comptroller to receive Mutilated 

^ ./ i notea may be 

mutilated circulating notes issued by him, and to deliver *'"'''*"^'^- 
in lieu thereof other circulating notes to the same amount. 

trailer. The very same conditions are imposed on every individual who 
thinks fit to engage in this business." (23 Wend., 159 ; see Safford v. Wyck- 
off, 1 Hill, 11.) 

After the decision of Ccshman, Circuit Judge, in Safford v. Wyckoff, in 
December, 1839, the officers of some of the associations assumed the power 
of issuing evidences of debt, which an association under the general bank 
law had not only no legal power to issue, but the issue of which, by such a 
moneyed corporation having banking powers, was expressly prohibited by 
the 35th section of the amendatory act of April 2, 1829 (Laws 1829, p. 167, 
§ 1 and § 35 ; see p. 29, ante ; p. 38, ante; and note 14). But this was not 
the only evil — the individual bankers were not within the terms of this pro- 
hibition of the said 35th section ; and were not then required by the gen- 
eral law of 1838, to file any certificate stating their places of residence or 
of business, or to make any annual statement of their affairs to the comp- 
troller ; but these individual bankers were authorized, by the same section 
(§ 3) and in the same language (as corporations formed under the 15th sec- 
tion), to loan and circulate countersigned notes — and by the act of 1837,. 
they had previously been authorized to keep offices of discount and deposit. 
Some of these individual bankers, in 1839 and 1840, established banking 
offices in various parts of the interior of the State remote from the centers 
of business, — and commenced by issuing a certain amount of countersigned 
notes in the name of the; " Atlas Bank," or some other such assumed name, — 
and after their countersigned notes became current, and the name of the 
"Atlas Bank," &a., familiar, it was easy to issue and put in circulation post- 
notes, in the name of the "Atlas Bank," Ac., engraved from plates similar 
to the authorized plates, in the custody of the comptroller, — but, of course, 
such post-notes were not countersigned by him, or in any manner secured. 

In the spring of 1840, a Mr. Schermerhorn established, as an individual 
banker, a bank called, " The North River Banking Compamy" — and in the 
name of said company, issued engraved post-notes and post-bills, with vig- 
nettes and other devioe8,-for f 10, |20, and |50, or for other round sums, 
payable in thirty, sixty, or some other number of days after date: this 
paper was put in circulation in this State and in Ohio — we have seen speci- 
mens of these issues by this individual banker.. 

To prevent the issue of a spurious currency by individual bankers, the 
legislature interfered by the Act of May 14th, 1840. This act was passed 
one month after the decision by the Court of Errors, of the case of. Warner 
V. Beers, and before the Supreme Court had set aside the verdict in Safford 
V. Wyckoff ; the decision in the latter case, was not made until January, 1841 
(1 Hill, 11). One of the main objects of the legislature, in enacting' the 
prohibition in the 4th section of the Act of May 14th, 1840, was, to reach- 
the illegal issues of post-notes or other evidences of debt, by individual 



116 SPECIAL STATUTES APPLICABLE TO 

Section re- 8 Q. The tMrty-tMrd section of the act hereby amended 

pealed. u « v f 

is repealed. 

bankers in the assumed name of the " Atlas Banh," &e., — ^henee the lan- 
guage of this section is, that — " No individual banker as such, shall issue, 
or put in circulation any bill or note, unless the same shall be made payable 
on demand and without interest," — and that every Tiolation of this section 
by any individual banter shall be deemed and adjudged a misdemeanor, &o. 
The legislature was compelled aftervrards to pursue this policy of restrict- 
ing and restraining the operations of individ%u3,l bankers, (see Laws 1841, 
chap. 319, p. 308; Laws 1844, chap. 281, p. 416; Laws 1848, chap. 340, 
p. 462 ; see note 37 on p. 92, ante). While providing a remedy for the pre- 
vention of the evils resulting from illegal issues by individual bankers oj 
such, the legislature of 1840 reiterated the prohibition of the 35th sec- 
tion of the Act of April 2, 1829, against an issue of post-notes by moneyed 
corporations formed under the General Bank Act, so as to leave no room 
for doubt or mistake as to its application to them ; in thus re-enacting this 
prohibition, the legislature added the sanction of an express reference to 
the penalties imposed for a violation of the statute, — in other words, de- 
clared, that such a violation was a, misdemeanor, punishable by fine or im- 
prisonment, or bothi It should also be borne in mind, that before the pass- 
ing of the Act of May 14th, 1840, it had been questioned whether associa- 
tions under the general law were, in the language of Judge Branson, " cor- 
porations, or something else." It was not until December, 1844, that the 
Court for the Correction o/ -Errors finally settled this question — by deciding 
that they were "moneyed or stock corporations" within the meaning of 
the statute, subjecting such corporations to taxation on their capital (1 E. 
S., 414, § 1, Supervisors of Niagara v. The People, 1 Hill, 504). 

We have seen that the Safety Fund, as well as the General Law Banks, 
had the express power to buy and sell bills of exchange ; yet both classes of 
moneyed corporations were prohibited from issuing- any bill on time (Laws 
1829, § 1, and § 35, pp. 29 and 38, ante; and note 39, p. 95, ante). 



DECISIONS ON SECTION 4 OF THE ACT OF MAT 14, 1840. 

January, 1842, 2 Hill, 241 : Smith and Warner v. Strong Cpost-bill). 

JanuaVy, 1842, 2 Hill, 295: Bank of Orleans v. Merrill (post-certificate 
of deposit). 

May, 1846, 3 Denio, 70: Swift v. Beers (guaranty of a post-note). 

September, 1846, 4 Edw. Ch. R., 134: Leavitt v. Totes (assignment to 
secure post-notes called " Yates Trust Notes "). 

June, 1848, 3 Barb. S. C. E., 222 : Tylee v. ' Yates (Yates Trust Post- 
Notes). 

{Leavitt V. Blatchford, and Leavitt 
V. Palmer (assignment to se- 
cure post-notes, payable in En- 
gland in sterling money). 



BANKING CORPORATIONS. IIY 

§ 7. Whenever the securities deposited for the redemp- jg^^^l^^"" 
tion of circulating noteS, shall in the opinion of the comp- miy §"''«- 
troUer, become insufficient for that purpose, he may receive 
the dividend on all stocks, as well as the interest on bonds 
and mortgages, and shall deposit the same in some safe bank 
or banking association in the city of Albany, in his name, 
in trust for the association or banker to whom the same 
may belong. The deposit to be made on such terms, and 



May, 1850, 8 Barb. S. C. R., 430: )Bank Commissioners v. St. Lawrence 
December, 1852, 8 Selden, 513 ; ) Bank (post-notes). 



AS TO THE ISSUE OF POST-NOTES AND POST-BILLS. SEE THE FOLLOWING OASES: 

I Hill, 11 ; 4 Hill, 442 : Safford v. Wyckoff {poBt-hill, dated August 16, 
1839). 

8 Barb. S. C. R., 233 : Bank, of Chilicothe v. Dodge (post-bill, dated Sep- 
tember 30, 1839). 

4 Paige, 224; 9 Paige, 471 : Attorney-General v. Life and Fire Insurance 
Company (post-notes, called " Life and Fire Bonds." See note 16, p. 42, ante). 

10 Paige, 109 : Ontario Bank v. Schermerhorn. 

8 Selden, 328: Talmage v. Pell (assignment to secure post-certificates 
of deposit). 

3 Selden, 364 : N. Y. lAfe Insurance and Trust Company v. Beebe (post- 
certificate -of deposit. See note 12, p. 26, ante). 

J^. A. Trust and Banking Company v. Himt (post-certificates of deposit, 
dated July 12, 1839. See note 16, pp. 45-4'7, ante). 

II Barb. S. C. R., 309 : Curtis v. Leavitt, and Leavitt v. Blatehford (as- 
signment to secure post-notes, or post-bonds. These cases now pending in 
the Court of Appeals). 

18 Barb. S. C. R., 456 : Tracy v. Talmage (in the matter of the claim of 
the State of .Indiana), (post-certificates of deposit. This case now pending 
in the Court of Appeals). 



8 McLean, 102: Root v. Godard. 

3 McLean, 276 : Hay den v. Davis. 

4 McLean, 8 : Root t. Wallace, 

4 McLean, 387 : Davis v. Bank of the River Raisin. 

2 Barr's (Penn.) R., 175: Southern Loan Company. y. Harris. 

9 Ohio B., 291 : In the matter of Ohio Life Insurance and Trust Company. 
12 OhioR., 300: Moore v. Gano. 



118 SPECIAL STATUTES APPLICABLE TO 

at such rate of interest as the comptroller may deem most 
conducive to the interest of such* association or banker, 
and to be withdrawn and paid over, whenever in the opin- 
ion of the comptroller, the securities of such association or 
banker, shall be sufficient to warrant it. 

18 Ohio R., 151: Lawler v. Walher. 

13 Howard, 218; Miller v. Austin. 

14 Conn. E., 363 : Kilgore v. Buckley. 



POEM 
(Of post-bill in Saffordy. Wychoff, 1 Hill, 11 ; 4 Hill, 442.) 



" Farmers' Bank of Senega County." 

" At thirty days after date, pay to the order of Eeuben D. Dodge 
three thousand dollars, and charge this institution." 

(Signed) " J. J. FENTON." 

" EoMBLDS, August 16, 1889." 

" To Walter Mead, Cashier." 
" Sew York." 

(Endorsed) " Pay D. B. Dodge or order." 

" Eeuben D. Dodbe." 
" D. B. Dodge." 



FORM 
(Of post-hill in Bank of Chilicothe v. Dodgi, 8 Barh. S. C. R., 283.) 



" $ 5,000." " Farmers' Bank of Seneca County." 

" Three months after date pay to the order of R. D. Dodge five 
thousand dollars,, and charge this institution. Romulus, September 
30th, 1889." 

(Signed) G. P. Hosmee, A. Cash. 

" To Walter Mead, Cash." 
" New York." 

(Endorsed.) 

" Pay D. B. Dodge order." 

" Eeuben D. Dodge." 
" D. B. Dodge." 



BANKING CORPORATIONS. 119 

§ 8. It shall be the duty of the ioint committee annu- committee 

" -^ , J of legislature 

ally chosen, to examine the treasurer's accounts, to examine ^a^^Spa't- 
such of the securities deposited in the comptroller's oflSce, "™ 
by banking associations, and individual bankers, together 
■with books and papers therein relating to the business of 
banking, as the said committee may deem necessary to en- 

FORM 

(Of post-bill in Smith and Warner v. Strong, 2 Hill, 241.) 



<< « 1 nnn " " Bank OF Westeen New Yoek." 

* ^"""- ■ " Rochester." 

" Four ndonths after date, please pay to the order of Josepli Strong, 
Esq^r., one thousand dollars, and charge this institution." 

(Signed) "M. F. Reynolds, Cashier." 

" To E. B. Strong, Esqr., Prest." 

No. 4. Wall street, New York." 

(Endorsed.) 
" Joseph Strong." 

(Written across.) 

" E. B. Strong, Prest." 
" Geo. , Cr." 



FORM 
(Of post-note and guaranty in Stdft v. Beers, 3 Denio, 70.) 



New York, 30th June, 1841." 

"Sixty days after date, The North American Trust and Bank- 
ing Company promise to pay to the order of Messrs. Swift & Co., 
thirty -seven hundred dollars for value received, with interest ; having 
deposited with them as collateral security, seven bonds of this Com- 
pany, secured under the Yates Trusij — ^three for one thousand dol- 
lars " [giving the amounts and nti/mbers of the bonds^. 

(Signed) " Thomas G. Talmaqe, Prest." 



(Guaranty.) 
" For value received I guarantee the payment of the above note." 

(Signed) " J. D. Beers." 



120 



SPECIAL STATUTES APPLICABLE TO 



able tbem to report the true state and conditions of that 
department to the legislature. 
tonS &°. § ^- It 8^3,11 be lawful for the president of any banking 
comptroUer. association, or any individual banker, to make or execute 
bonds and mortgages direct to the comptroller, to secure 
the payment of circulating bills or notes, issued under the 
act to auth'brize the business of banking, and all such 
bonds and mortgages heretofore received by the comptrol- 
ler for sucih purpose shall be valid. 



FORM 

(Of post-certificates of iieposit in Leamtt y. Paelmeir, 3 Gomstoek, 19; 6 

Barb. S. C. R., 9.) 



W 



^ 



|Zi 



"£ 1,000 st'g." " New York, November 30, 1840." 

" Twelve months after date, tie North Ameeioan 
Trust and Banking Company promise to pay to the order 
of William R. Cooke, for value received, the sum of one 
thousand pounds sterling, with interest thereon, at the rate 
of seven per centum per annum, payable at ±he Banking 
House of Messrs. Palmers, Maekillop, Dent & Co., London." 



' Walter Mead, Cashier.'' 



'Tnoa. G. Talmage, Pres't." 



" This note is issued in pursuance of a Deed of Trust ex- 
ecuted between the Company and Richard M. Blatohford 
and James B. Murray, Trustees, and the payment of the 
same is guarp.nteed by the securities' thereby transferred." 



FORM 

(Of post-notes in Bank Commissioners v. St. iMwrence Bank, 3 Selden, 513 ; 

8 Barb. S. C. R., 480.) 



'1 3,00.0." 



' St. Lawrence Bank, Ogdensburgh, April 21, 1841." 



" Ten months after date, the St. Lawrence Bank promises to pay 
to the order of George W. Shepard, at the Albany City Bank, three 
thousand dollars, with interest, value received." 



(Signed) 
" E. N. Faibohild, Cashier." 



' H. Van Rensselaer, President." 



BANKING OORPORATIONS. 121 

§ 10. All fees for protesting the circulating notes issued Feeof pro- 



FORM 
(Of the Post Certificate of Deposit in Talmage v. Pell, 3 Selden, 328.) 



[Vignette.] 
"No. 746." 



' NoKTH American Trust & Banking Company, 
" City of New York, Nov. 22, 1839." 



" Samuel F. MeCraoken, Daniel Kilgore, and Joseph S. Lake, 
e; Commissioners, have deposited in this bank thirteen thousand 
g eight hundred and thirty three 88-100 dollars, payable to their 
g order; on the return of this oertifioate^-on demand after 6th Au- 
fi gust, 1840." 



"Capital" 
" ($10,000,000.)" 

'($13,833 88-lOOyw.)" 



O " Waltee Mead, Cashier." 



(Signed) "J. D. Bbers, Pres't." 

(Endorsed) 

' Samuel F. MoCkaoken,'' 
' Daniel Kilgoee," 
' Joseph S. Lake," 

" Cqmmissioners of the Ohio Canal Fund." 



FORM 

(Of post-notes in Zeavitt v. Yates, 4 Edw. Ch. R., 184 ; and Yates v. Tylee, 

3 Barb. S. C. R., 222.) 



-alO 

gpq 

U 
o 



« $1,000." 



"No." 



' New York, December 15, 1,840." 



" Thirteen months after date, the North American Trust 
AND Banking Company promise to pay at their Banking House, 
to the order of Elam H. Gibbs, for value received, the sum of 
one thousand dollars, with interest thereon at the rate of seven 
per centum per annum." 

" Thos. G. Talmage, President." 

"D. E. Tylee, Cashier." 



" The payment of this obligation, with others, amounting 
in the aggregate to $600,000, is guaranteed by the transfer of 
securities estimated at $800,000, under a Deed of Trust exe- 
cuted between the Company and Henry Yates, Thomas 6. Tal- 
mage, and William Curtis Noyes, Trustees, bearing even date 
herewith." 



122 SPECIAL STATUTES APPLICABLE TO 

tesHng, how by 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 association or 
banker shall be applied to the payment of such fees. 
bankToS-"' ^^^- ^vcry banking association and individual bknker, 
StenSo carrying on banking business, or who shall hereafter carry 

assooiatioDB, ,,.,. ,, i-it. 

&<!■ on banking business, under the act to authorize the busi- 

ness of banking, shall be subject to the inspection and 
supervision of the bank commissioners, whose powers and 
duties shall be the same, in respect to said banking associ-: 
ation or individual banker, as they are, or may be, in re- 
spect to any of the incorporated banks of this State. 
When and 8 12. In casc any of the said associations or indivi- 

bow asMcia- " ^ 

tionstobe ^^g^j bankers shall refuse to submit its books, papers, and 

FORM 

(Of " Life and Fire Bonds " in Attorney General v. Ijife and Mre Ins, Co., 

i Paige, 224; 9 Paige, 4'71-4'76; see p 43, ante, note 16.) 



" The Life and Fibb Instjrahoe Compant promise to pay, six months 
after date, to H. Kingsland, or his order, at their office, one thousand 
dollars, with interest at the rate of six per cent, per annum, from the 
date hereof; interest payable quarterly." 

"For the payment whereof, the Company hind theniselves and their 
successors, and have hereunto caused their President and Secretary to 
subscribe their names. New Yobk, April 10, 1824." 

" M. L. Davis, Secretary." 

(Signed) " H. Eokeokd, President." 



FORM 

(Of certificates of deposit in North American Trust and Banking Co. v. Hunt, 

see note 16, p. 45, ante.) 



FORM 

(Of certificates of deposit in New York Life Insurance and ?V««< Co. v. 

Beehe, 3 Selden, 364; see note 12, p. 26, ante.) 



BANKING CORPORATIONS. 123 

concerns to the inspection of said commissioners, or either proceeded 

r ^p^ ' against, 

of them, or whose officers shall refuse to submit to be ex- 
amined upon oath touching the concerns of such associa- 
tion or individual banker, by said commissioners or either 
of them, or which shall be found to have violated any law 
of this State, binding upon such association or individual 
banker, such association or individual banker shall be lia- 
ble to be proceeded against by said commissioners, in the 
same manner and with the like effect as any incorporated 
bank may be proceeded against for a violation of its charter. 

§ 13. There shall be appointed one additional bank Additional 

t f t f» rv^ 1 bank oom- 

commissioner, whose style and term of office, powers, da- misaioner. 
ties, compensation and manner of appointment, shall be 
the same as those of the present commissioners. The sal- 
ary of such commissioner shall be paid quarterly by the 
treasurer, on the warrant of the comptroller, and the 
amount thereof retained by the comptroller and paid into 
the treasury, out of the interests upon the securities de- 
posited with the comptroller by the said banking associa- 
tions and individual bankers, in proportion to the amount 
of securities deposited by each. 

§ 14r. J^othing in the act hereby amended shall be con- Fonneract 
strued to prevent any body corporate, which may have vent certain 

^ ./ .^ jr J J corporations 

power to hold, receive, or transfer, shares of public debt, of'LS^"'' 
bank stock, or the like personal property, from also hold- 
ing, receiving, or transferring any transferable shares of 
the stock of associations organized under the said act. 



124 SPECIAL STATUTES APPLICABLE TO 

ACT OF MAR0H^5th, 1841. 

(LAWS 1841, CHAP. 46, P. 26.) 



An Act to a/mend the act entitled "An act to authorize the 
hwiness of hanking" passed April 18, 1838. Passed 
March 15, 1841. 



The People of the State of New York, represented in 
&nate and AssemUy, do enao^ as follows ; 

Fonrth 8 1. The fourth section of the act entitled "An act to 

section of ^ 

baDltag'act authorize the husiness of banking," passed April 18, 1838, 
shall be modified so as to read as follows : 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 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 
jefuse to redeem such note in the lawful money of the 
United States, the holder of such note or notes making 
&uch 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 circulat- 
ing notes issued by such person or association, will be re- 



BANKING CORPORATIONS. 125 

deemed out of the trust funds in his hands for that pur- 
pose ; and the comptroller shall be required to apply the 
said trust fund belonging to the maker or makers of such 
protested notes to the payment, pro rata, of all such circu- 
lating notes, whether protested or not, put in circulation 
by the maker or makers of such protested notes, pursu- 
ant to the provisions of this act, and to adopt such mea- 
sures for the payment of such notes as will in his opinion 
most effectually prevent loss to the holders thereof. 
§ 2. This act shall take effect immediately. 



ACT OP MARCH 16th, 1841. 

(LAWS 1841, CHAP. 56, P. 33.) 



An Act rejecting suits and legal proceedings iy or agamst 
hanking associations. Passed Ma/rch 16, 1841. 



The People of the State of New York, represented in 
Senate and Assembly, do enact as follows : 

§ 1. Actions instituted against any association estab- Actions 
lished or to be established under the provisions of themencediTy"' 

declaration, 

"Act to authorize the business of banking," passed April 
18, 1838, or of any act amending the same, may be com- 
menced by declaration, and copies of such declaration may 
be served on the president or cashier of such association, 
and in their absence on any director at the usual place of 
business thereof, or in such other manner, as the court in 
which such action is brought may direct. But all such 
actions shall nevertheless be commenced only against the 



126 SPECIAL STATUTES APPLICABLE TO 

persons and in the manner prescribed or permitted by the 

acts above mentioned. 
Actions 8 2. Any person who shall be or shall have been an 

commenced associate or shareholder of any sucb association, may in 
aStes^or' respect of any demand which he may have, either solely 

share-hold- . . , . , . , . . 

«s. or jointly with any other person, against sucn association 

commence and prosecute, either solely or jointly (as the 
case may be) any action, suit, or other proceeding in law 
and equity, against the president of such association ; and 
any president of such, association may commence and 
prosecute any action, suit, or other proceeding in law or 
equity, against any person who may be or who may have 
been an associate or shareholder of such association, either 
alone, or jointly with any other person against whom such 
association may have any demand whatever. All such 
suits or proceedings by or against such president, shall be 
conducted and have the same legal effect as if such asso- 
ciate or shareholder had never been a member of such 
association. Nor shall any action or suit be in any way 
affected by reason of the plaintiff" 's or defendant's, or any 
other person who may be in any way interested in such 
action, being or having been a shareholder or associate of 
such association. ISTor shall it be necessary in any process, 
pleading, or proceeding in behalf of or against any such 
association, to name the individuals composing the same. 
Interest In § ^- "^^ claim or demand which anyassociate or share- 

de°nds noteholder may have in respect to his share or Interest in the 

be set off 

^mMd""* capital or joint stock of any such association, or of any 
dividends, interest, or profit thereon, shall be capable of 
being set off either at law or in equity against any demand 
which sucli. association may have against any associate or 
shareholder thereof. But all other demands may be set 



BANKING CORPOEATIONS. 127 

off in the same manner as in suits between individuals ; 
and in any suit against the president of any such associa- 
tion, as president thereof, he may set off demands belong- 
ing to it in the same manner and with the same effect as 
if such association was the nominal party in the cause. (5H) 



ACT OF APRIL 27th. 1841. 

(LAWS 1841, CHAP. 130, P. 106.) 



An Act respecting the appointment of Receivers of Mon- 
eyed Institutions. Passed April 'ilth, 1841. 

The People of the State of New Yorh, represented in 
Senate and Assenibly, do enact as follows : ( 52 ) 

§ 1. "Whenever in proceedings in the court of chancery Eeceivera 
against any moneyed corporation, or any banking associa- pointed by 
tion, or individual banker, formed or transacting busi- m^ioners. 
ness under the " Act to authorize the business of banking," 
passed April 18, 1838, it shall become necessary or expe- 
dient to direct the appointment of a receiver of the effects 
of any such corporation, association, or banker, or in the 
case of the death or resignation of any such receiver, an 
order shall be entered by such court referring it to the 
bank commissioners to name a proper person to be ap- 
pointed such receiver, and to take from said receiver such 
security, and in such penalty as they shall deem proper for 
the faithful discharge of his duties ; the sufficiency of such 

(514) See note (40), p. 98, ante. 

(52) This act repealed by the act of January 22d, 1842. (Laws 1842, 
chap. 3, p. 4.) See also the act of April 11th, 1842. (Laws 1842, chap. 222, 
p. 273.) See these acts, post. 



128 SPECIAL STATUTES APPLICABLE TO 

security shall be determined by them in the manner now- 
provided by the rules of the court of chancery for asceir- 
taining the sufficiency of sureties, and for accounting 
whenever required ; and on the filing of a certificate by 
the bank commissioners naming any person to be ap- 
pointed such receiver, together with the bond given by 
him, an order shall be entered by the said court appoint- 
ing the person named in such certificate receiver of the 
effects of such corporation, association, or banker, with 
the usual powers of receiver in such cases. 
Tobesnb- 8 2. Such receiver shall be subiect to the direction and 

jcct to direo- " ' ■' 

tro°™com-' control of the bank commissioners in respect to the collec- 
mias oners. ^.^^ ^^^ management of the effects of such corporation, 
association, or banker, and with their assent may compro- 
mise and compound any claims or demands of such corpo- 
ration, association, or banker, and may extend the time for 
the payment of any such claims or demands, and may sell 
any effects in his hands at public auction or private sale, 
and on such terms of credit as may be deemed most for 
the interest of all parties concerned. 
How to be § 3' Whenever the bank commissioners shall be dissat- 
remove . jggg^ ^j|.]j ^}jg proceedings of any receiver of the effects of 
any such incorporation, association, or banker, hereafter 
appointed, they may by writing under their hands certify 
to the court of chancery that such person shall be removed 
from his appointment of receiver ; and on filing such cer- 
tificate in the court by which such receiver was appointed, 
such court shall enter an order removing him ; and there- 
upon a further order shall be entered, referring it to the 
bank commissioners to appoint a receiver in the plg,ce of 
the person so removed, and the same proceeding shall be 
had thereon as provided in the first section of this act in 



BANKING CORPORATIONS. 129 

the case of an original appointment, and the receiver so 
appointed shall possess the like powers, and be subject to 
the same directions as provided by this act in case of an 
original appointment. 

§ 4. The receivers to be appointed under and in virtue Pay of re- 

. oeivers. 

of this act shall be entitled to the same commissions and 
compensation for their services as are now allowed by law 
. to executors and administrators, and no greater or other 
commissions or compensation than is hereby allowed shall 
be received or retained by them. 

§ 5. This act shall take effect immediately. 



ACT OP MAY 26th, 1841. 

(LAWS 1841, CHAP. 319, P. 308.) 



An Act to amend the act entitled " An Act to authorize 
the business of banking." Passed May 26th, 1841. 



The People of the State of New York, represented in 
Senate omd Assembly, do enact as follows : 

§ 1. Every banking association and individual banker asbocIs- 

tions and 

carrying on banking business, or who shall hereafter bankeMto^j 
carry on banking business, under the act to authorize the b»„'|™m-'° 
business of banking, shall annually make out and transmit yearly. 
to the bank commissioners in the form prescribed by them, 
a full statement of its affairs, verified by the oaths of its 
president and cashier, which statements shall be deposited 
by such banking association or individual banker respect- 



130 SPECIAL STATUTES APPLICABLE TO 

ively, in the oifice of the secretary of the State, sealed and 
directed to said commissioners, on or before the twentieth 
day of January in each year, after the passage of this act, 
or after the time of their having respectively commenced 
the business of banking, as prescribed by the act hereby 
amended. 
statement, § 2. Such Statement so transmitted shall contain, 

how to be 

made out 1, The amouut of the certified stock of the capital stock , 

of the banking association or individual banker paid in or 
invested according to law, or in pursuance of its articles of 
association, and the amount of such stock as then pos- 
sessed : 

2. The value of the real estate of the association or in- 
dividual banker, specifying what portion is occupied by 
the association or individual banker for the transaction of 
business : 

3. The shares of stock held by such association or in- 
dividual banker, whether absolutely, or as collateral secu- 
rity, specifying each kind and description of stock, and the 
number and value of the shares of each : 

4. The debts owing to the association or individual 
banker, specifying such as are due from moneyed or other 
corporations or associations, the names of such corpora- 
tions or associations, and the amount due from each ; and 
also specifying the amount secured by bond and mortgage 
or judgment, the amount which ought to be included iiithe 
computation of losses, and the total amount of such, debts 
then collectible. 

^ ) 

5. The amount of debts owing by the association or 
individual banker, specifying such as are payable on de- 
mand, and such as are due to moneyed or other corpora- 
tions, associations, or individual bankers, the names of 



BANKING CORPORATIONS. 131 

such corporations, or associations, or individual bankers, 
and the amount due to each : 

6. The amount of claims against the association or in- 
dividual banker, not acknowledged by it or him as debts : 

7. The amount for which the association or individual 
banker is bound as surety, or for which it may become lia- 
ble on the happening of contingent events, whether upon 
policies of insurance or otherwise : 

8. The amount of the notes or bills then in circulation, 
of said association or individual banker, of loans and dis- 
counts, and of specie on hand : 

9. The amount on the first of July next preceding, of 
notes or bills in circulation, of loans and discounts, and of 
specie on hand, of such association or individual banker : 

10. The amount of the losses of the association or 
individual banker (if any) charged, specifying whether 
charged on its or his capital or profits since the last preced- 
ing statement, and of the dividends declared and made 
during the same period : 

11. The amount of real estate mortgages and of state 
stocks, together with the description of such stocks depos- 
ited by each association or individual banker with the 
comptroller as security for the circulating notes issued, 
the market value of said stocks as near as the same can be 
ascertained, and the date to which payment of interest has 
been made upon such real estate mortgages and stocks, and 
whether said interest has been paid to such banking asso- 
ciation or individual banker, or passed to their or his credit 
on the books of the comptroller. 

§ 3. Every association that shall neglect to make out Penaityfoi 

neglect 

and transmit the statement required as prescribed in the 
first section of this act, may be proceeded against and dis- 



132 SPECIAL STATUTES APPLICABLE TO 

solved as an insolvent association, and every individual 
banker subject to this law, who shall so neglect, shall be 
restrained from the farther prosecution of his business. 
Bank com- § 4. It shall be the duty of the bank commissioners to 

misfcionera to 

prepare prepare forms of the statements, and to transmit a copy 
statements, thercof, together with such instructions as they may deem 
necessary, to every association or individual banker which 
is or shall be bound to furnish such statements under the 
provisions of this act. The expenses of printing the forms 
of said statements and instructions shall be paid by the 
treasurer on the warrant of the comptroller, and the 
amount thereof retained by the comptroller and paid into 
the treasui-y, out of the interest of the securities deposited 
with the comptroller by the said banking associations and 
individual bankers, in proportion to the amount of securi- 
ties deposited by each. 

§ 5. The twenty-sixth section of the act hereby amended 
is repealed. 

§ 6. The iirst section of the act hereby amended, shall 
be amended so as to read as follows : 
oomptroi- '^^® comptroller is hereby authorized and required to 
izedM print causc to be eugravcd and printed in the best manner to 

circulating 

b°'kMte g^^rd against counterfeiting, such quantity of circulating 
notes in the similitude of bank notes, in blank of the differ- 
ent denominations authorized to be issued by the incorpo- 
rated 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 countersigned, numbered, and 
registered in proper books to be provided and kept for 
that purpose in the office of said comptroller, under his 
direction, by such person or persons as the said comptroller 



BANKING CORPORATIONS. 133 

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. 

§ 7. Every assignment of any bond or mortgage exe- -^'''S"-. 
cuted by the comptroller under his official seal, in pursu-f^^^^^yP^™'" 
ance of the provisions of the said act, or which may be 
otherwise authorized by law, may be recorded in the same 
manner and with the like effect as a deed regularly ac- 
knowledged or proved before any officer authorized by law 
to take the proof and acknowledgment of deeds. 

§ 8. When any individual banker or the officers of any Banker or 

, _ , . asBociation, 

banking association desirous of relinquishing the banking J^^^^'J^^ 
business, shall have redeemed at least ninety per cent, of '^"'^°'' 
their circulating notes, and shall produce to the comptroller 
a certificate of a deposit to his credit in such bank as he 
shall approve, to an equal amount with the circulating 
notes of such bank unredeemed, it shall be lawful for him. 
to receive the same, and to give up all the securities there- 
tofore deposited by such banker or association, for the 
redemption of circulating notes issued. 

§ 9. Such association or individual banker, after hav- Notice to 

. .. .be given for 

mg complied with the provisions of the preceding section, two years. 
may give notice for two years in the State paper, and also 
in at least one newspaper printed in the county where the 
said association or bank shall have been located, that all 
circulating notes issued by such association or bank, must 
be presented at the comptroller's office within two years 
from the date of such notice, or that the funds deposited 
for the redemption of the notes will be given up to the 
bank or association ; and on receiving satisfactory proof of 
the giving such notice for the time aforesaid, the comp- 
troller shall surrender to the order of the said association 



134 SPECIAL STATUTES APPLICABLE TO 

or bank, any securities which he may hold for the pay- 
ment of any unredeemed notes of the said association or 
bank. ( 53 ) 
efSto^ § 10. It shall be the duty of the secretary of state to 
i°prif 18?°' "'p^iitlish with the session laws for the year 1841, a chapter 

18B8,and . . ./ ' r 

amendme'ts. contammg the act to authorize the business of banking, 
passed April 18, 1838, as amended by subsequent enact- 
ments, showing in a corrected and condensed form the pro- 
visions of law at present in operation affecting the associa- 
tions or individuals doing business under the said acts. 
{See Session Laws 1841, p. 251 to 268.) 



ACT OP JANUARY 22d, 1842. 

(LAWS 1842, CHAP. 3, P. 4.) 



An Act to repeal an act enUtled " An act respecting the 
appointment of Beoeivers of Moneyed Institutions^'' 
passed April ^Ith, 1841, and to limit the compensation 
of Receivers. Passed January 22, 1842. 



The People of the State of New YorJs, represented in Sen- 
ate and Assembly, do enact as follows : 

Eepeai. § 1. The act entitled " An act respecting the appoint- 

ment of receivers of moneyed institutions," passed April 
27th, 1841, is hereby repealed. 

Pay of re- § 2. Ecccivers of moneyed institutions shall be entitled 
to the same commissions and compensation for their ser- 

(53) § 9 of this act amended by § 1 of the act of March 29, 1851 (Laws 
1851, chap. 68, p. Y5). See this act, ^osi. 



ceivers. 



BANKING CORPORATIONS. 135 

vices as are now allowed by law to executors and admin- 
istrators ; and no greater or other commissions or compen- 
sation than is hereby allowed shall be received or retained 
by them. 

§ 3. This act shall take effect immediately. (54) 



ACT OP APRIL 11th, 1842. 

(LAWS 1842, CHAP. 222, P. 273.) 



An Act respecUng Receivers appointed hy the Bank Com- 
missioners under the act entitled "An act respecting 
the appointment of receivers of moneyed institutions" 
passed April 27, 1841. Passed April 11, 1842. 



The People of the State of New Yorh, represented in Sen- 
ate a/nd Assembly, do enact as follows : 

§ 1. That all the receivers heretofore appointed by the Eeceivors 

" ^ , rr ./ snbjecttothe 

bank commissioners, under the act entitled "An act re- "^^^ 5^„j""' 
specting the appointment of receivers of moneyed institu- 
tions," passed April 27, 1841, shall be subject to all the 
provisions of law applicable to receivers of moneyed in- 
stitutions appointed by the chancellor pi-evious to the 
passage of the last-named act, and shall be accountable to 
and under the direction of the chancellor in relation to all 
their powers and duties, and the property and effects that 
has or shall come into their hands as such receivers, in the 



(54) See the act of April 11th, 1842. (Laws 1842, chap. 222, p. 273.) 
See this act, post. 



136 SPECIAL STATUTES APPLICABLE TO 

same manner and to the same extent as they would have 
been had they been appointed by the chancellor. 
• It shall be the duty of the chancellor, from time to 
time to make such directions to such receiyers in relation 
to the property and effects in their hands, or hereafter to 
come into their hands, as he shall deem most beneficial 
to the creditors of such moneyed institutions ; and the 
chancellor shall have power at any time to remove any 
such receiver, and to appoint others, for neglect of duty 
or official misconduct, in the same manner and with the 
like power that he now has over receivers appointed by 
himself, and not otherwise. 

§ 2. This act shall take effect immediately. ( 55 ) 



ACT OP APRIL 18th, 1843. 

(LAWS OF 1843, CHAP 218, P. 299.) 



An Act to abolish the office of Bank Commissioner, and 
for other purposes. Passed April 18, 1843. 



The People of the State of Nenjo York, represented in 
Senate and Assembly, do enact as follows : 

Banks to § 1. Evcry chartered bank shall take an account of its 

return state- ,t, i_r» t t* t i -t 

mcntofcir- Qotes for Circulation on the hrst day of July, eighteen 



(55) See provisionB of the Revised Statutes as to the power and jurisdic- 
tion of the chancellor in cases of insolvent corporations, <Stc. (pp. 50-'74, 
ante) ; and also relating to Receivers of such corporations (pp. 59-64, and 
68-73, ante); also note 25, p 74, ante; see also the act of April 16, 1849 
(Laws 1849, chap. 226, p. 340) ; also, the act of March 15, 1855 (Laws 1855, 
chap. 69, p. 101). See these acts, post. 



BANKING CORPORATIONS. 137 

hundred and forty-three, and shall return to the comp- cuiattng 

•' ' -"^ notes to 

troller, under the oath of the president and casliier, a"""^'""^" 
statement of all the notes of the bank which it has in 
possession, or in any way out&tanding or in circulation on 
that day, specifying the amount of bills of each denomina- 
tion, and the aggregate amount of the whole circulation, 
and shall at the same time deposit with the comptroller 
their plates ; and no bank shall after the time in that day 
to which the return of the president and cashier is made 
up, issue any of its own notes which have not been 
countersigned and registered by tbe comptroller ; but if 
the comptroller shall be unable to supply any bank with ^^^ ^j 
countersigned and registered notes as fast as such bank ionnterBign 

• T/» -in 1 /"Ti •! register 

may require, on and after the first day oi July, eighteen notes. 
hundred and forty-three, such bank may be permitted by 
the comptroller to re-issue so much of its old circulation, 
within the limits prescribed by law as may be necessary, 
not exceeding the amount returned to be outstanding on 
that day; nor shall any such issue take place until an 
application has first been made to the comptroller for 
countersigned and registered notes, and refused ; and pro- 
vided, also, that the stockholders of any chartered bank 
shall be individually liable for all the notes of its old cir- 
culation which shall be outstanding on and after the first 
of July, eighteen hundred and forty-four ; and after the 
first day of July, eighteen hundred and forty-four, no 
bank shall pay out any note of any bank which has not 
been countersigned and registered at the comptroller's ^^^^^^ 
office, as herein provided. And all the notes of any bank ?£mea° 
issued prior to the first of July, eighteen hundred anded. 
forty-three, not countersigned and registered, or delivered 
to the comptroller to be countersigned and registered 



138 SPECIAL STATUTES APPLICABLE TO 

shall, on or before the first of July, eighteen hundred 
and forty-four, be redeemed and destroyed in the presence 
of the comptroller, or of some person to be appointed by 
him for that purpose. And a certificate of the counting 
and destruction of the notes certified to be destroyed 
shall be signed and sworn to by the comptroller or his 
agent, and an agent appointed by the bank, and deposited 
in the comptroller's office. 
oomptroi- § 2. It shall be the duty of the comptroller to receiye 
plates and and safelv keep the plates to be delivered to him by the 

print and de- J r r J 

t^ban^^ banks, as prescribed in section first ; and at all times to 
an^'oountei^ causo to be printed from said plates, and to deliver to 

signed. 

each bank such notes, and of such denomination as is now 
allowed by law, as the bank owning such plates may 
require, not exceeding together with outstanding old cir- 
culation, and with the notes previously received, the 
amount of circulation now allowed to such banks by law ; 
and it shall also be the duty of the comptroller to employ 
suitable persons whose duty it shall be to countersign 
such bills in such uniform manner as the comptroller may 
prescribe ; and every note so countersigned shall, before 
it is delivered to the bank, be registered in a book to be 
kept by the comptroller for that purpose ; and the ex- 
penses of preparing, countersigning, and registering such 
notes, shall he paid to the comptroller by the banks re- 
ceiving the same, in proportion to the number of notes 
received. And it shall be competent for the comptroller, 
when the plates of any bank are worn or otherwise unfit 
for use, to require such bank to furnish new plates, or to 
procure them himself at the expense of such bank. 

§ 3. Every bank and banking association shall make a 
quarterly report to the comptroller, commencing on the 



BANKING CORPORATIONS. 139 

first Monday of August next, to be continued on the first 
days of November, February, May, and August there- 
after, in each and every year ; which said report shall be 
made on the oath of the president and cashier, and shall 
contain a true statement of the following items, on the 
morning of the said first Mondays of August, before any 
business of that day. Loans and discounts, over drafts, 
due from banks, due from directors of said bank, due 
from brokers, real estate, specie, cash items, stocks and 
promissory notes, bills of solvent banks, bills of suspended 
banks, loss and expense account, capital, circulation (dis- 
tinguishing that received from the comptroller from the 
old, outstanding bills), profits, amount due to banks, 
amount due to individuals, amount due to treasurer of 
state, amount due to commissioners of canal fund, amount 
due to depositors on demand, amount due not included 
under either of the above heads. And it shall be the 
duty of the comptroller to publish said reports together in 
the State paper, accompanied with a summary of the 
items of capital, circulation, and deposits, specie and cash 
items, public securities, and private securities ; and the 
separate report of each bank shall be published in a news- 
paper published in the county in which such bank is 
situated, at the expense of said bank. ( 56 ) 

S 4. The comptroller shall publish the reports and Keportand 

* summary to 

summary required by the third section, together, in one^^f"'''''''^''- 
paper, on or before the twentieth day of August, Novem- 
ber, February, and May, in each year, and the expense of 
such publication shall be defrayed by a percentage as- 



(66) § S and § 4 of this act amended by §§ 1, 2, of the act of December 
4, 184'7 (Laws 1847, chap. 419, p. S19). See this act, post. 



140 SPECIAL STATUTES APPLICABLE TO 

sessed upon the capital stock of all the banks and banking 
associations of the State : and if any bank shall fail to 
furnish to the comptroller its quarterly report in time for 
such publication, it shall forfeit and pay to the comp- 
troller the sum of one hundred dollars, to be applied by 
him to the payment of the expense of publishing the 
quarterly reports ; and if any bank or banking associa- 
tion shall neglect or refuse to make the quarterly report 
required by the third section, for two successive quarters, 
it shall forfeit its charter (if an incorporated bank), and its 
privileges as a banking company, if organized under the 
law of April, 1838, and may be proceeded against and its 
affairs closed, in any manner now provided by law in case 
of an insolvent bank or banking association. 
ProTision § 5. "Whenever it shall appear, from the reports made 
tapSed!"^ by any bank or in any other way, that the capital of any 
bank has become impaired and reduced, it shall be compe- 
tent for the comptroller to call upon such bank to redeem 
its circulation while its capital continues so reduced, so 
that the circulation of such bank shall not exceed that to 
which its reduced capital would by law entitle it. 
Office of 8 6. The office of bank commissioner is hereby abol- 

bank com- " *' 

SShei ished ; provided, however, that it shall be competent for 
the comptroller, whenever he shall have good and suffi- 
cient reason to suspect the condition of any bank, or the 
correctness of its quarterly report, to appoint a special 
agent to examine the affairs of such bank, and who for 
that piirpose shall have the same powers now vested by 
law in a bank commissioner. And the expenses of such 
investigation, if such bank shall be proved to have made 
a false return, or otherwise to have been guilty of a 
violation of law, shall be paid by said bank ; but if it 



BANKING CORPORATIONS. 14:1 

appear that such bank has ' violated no law, then the ex- 
penses of such examination shall be defrayed in the same 
manner as is herein provided for defraying the expenses 
of the publication of the quarterly reports. 

§ 7. Any bank may, at its pleasure, on paying its Provisioii 
dues to the safety fund, and on depositing with the comp- f^/_ '^^ 
troller an amount of money equal to the wliole amount 
which any such bank would be liable to pay to the safety 
fund during the time of its original charter, and all other 
debts and demands against it, wind up its affairs, dis- 
tribute its assets among its stockholders, and resign its 
charter, and close its business by a resolution passed at 
a meeting of the stockholders, and approved of by a 
majority of stockholders in interest of such bank called 
for that purpose, a copy of which resolution shall be 
furnished to the comptroller, and shall also be published 
for three successive weeks in the State paper ; and if any 
outstanding notes or other demands are not presented 
within one year, such bank may deposit with the comp- 
troller, or elsewhere under his direction and subject to his 
order, on interest, a sum sufficient to meet such outstand- 
ing demands, which, when presented to the comptroller, 
shall be paid by him out of such sum ; and such bank 
may distribute among its stockholders the surplus of its 
assets ; and after six years from the day on which publica- 
tion of dissolution was first made, the comptroller shall 
return to the stockholders, to be distributed, the remainder, 
if any, of the sum so deposited. 

§ 8. All acts, heretofore passed, that conflict with the Repeal, 
provisions of this act are hereby repealed. 



142 SPECIAL STATUTES APPLICABLE TO 



ACT OF MARCH 16th, 1844. 



(LAWS 1844, CHAP. 41, P. 35.) 



An Act to amend the act passed April 18, 1838, entitled 
" An Act to authorize tJie business of hamMng." 
Passed March l&th, 1844. 



The Pecple of the State of New YorTc, represented in 
Senate amd Assemhly, do enact as follows : 

comptroi- R 1, fhe Comptroller is hereby authorized to receive 

lep may re- o jr ./ 

hoirus. and hold all stocks of the United' States already deposited 
in hisoflBce, as security for circulating notes issued, or that 
may be issued to any banking association or individual 
banker, on the security of the said stocks, in the same 
manner, and with like effect, as if they were stocks of this 
State. 

§ 2. This act shall take effect immediately. 



ACT OP MAY 6th, 1844. 

(LAWS 1844, CHAP. 281, P. 416.) 



An Act to ajmend tJie act passed May 14, 1840, " An Act 
to amend the act entitled an act to authorize the business 
of hamJcvng. Passed May 6^A, 1844. 

The People of the State of New Yorh, represented in 
Senate and Assembly, do enact as follows : 

§ 1. The third section of said act is hereby amended so 
as to read as follows : 
Associa- No association of persons shall commence the business 



BANKING CORPORATIONS. 143 

of banking tinder said act, until sucli association shall '^'^s^jd in- 
have deposited with the comptroller the securities re- deposUBeeu- 

rlties with 

quired by law, to tbe amount of one hundred thousand comptroller, 
dollars ; and no individual banker or bankers shall com- 
mence the business of banking under said act, or receive 
circulating notes under the same, until such individual 
banker or bankers shall have deposited with the comp- 
troller the securities required by law, to the amount of 
fifty thousand dollars. 

§ 2. Each and every individual banker now "ioing Mividnai 
business under the general banking law of this State, orotgerslre"?- 
who shall, before this law takes eii'ect, have received cir-them. 
culating notes under the said act, shall state in his 
quarterly reports, whether any person or persons, and 
who, are interested with such individual banker, directly 
or indirectly, in the securities deposited with the comp- 
troller for the circulating notes obtained by such individ- 
ual banker, or in the business of circulating said notes, 
or the benefits or advantages thereof; and if it shall ap- 
pear from such report that any other person is so interested 
with said banker, and in case two successive reports of said 
banker shall not contain such statement, or if he omit 

Penaltyfor 

twice in succession to make such quarterly reports, such J^jo"""* '" 
banker shall forfeit one thousand dollars for each and every 
omission to make such statement, or to file such reports as 
aforesaid, to be sued for and recovered by the attorney- 
geneial, in the name and for the benefit of the people of 
this State. (57) 

(57) §§ 2 and 8 of this act extended and declared to be applicable t _ 
every individual banker " who is now doing business, or shall hereafter do 
business, under the general banking laws of this State," by § 5 of the act of 
April 15, 1854 (Laws 1854, chap. 242, p, 651). See this act, post. 



144 SPECIAL STATUTES APPLICABLE TO 

indivtanai § 3. Evcrv individual banker who shall heretofore 

u8fDK6r8 to 

Se^rfiwi- liave obtained circulating notes of the comptroller, under 
comptrouer'ssaid act, shall within ninety days after this act takes effect, 
, file in the comptroller's office a certificate, stating the 

town, city, or village in which he resides ; and thereafter 
it shall not be lawful for such individual banker to trans- 
act business under said act in any other place than in 
which he resides ; and in case of any change of residence 
of such individual banker, he shall forthwith file a notice 
thereof in the comptroller's office as aforesaid. Any per- 
negiect!'^'"' SOU neglecting to comply with the requirements of this 
section, or either of them, shall, for each neglect, forfeit 
one thousand dollars, to be sued for and recovered by the 
attorney-general, in the name and for the benefit of the 
people of this State. [See note 5T, p. 134, cmte.'\ 
§ 4. This act ^hall take effect immediately. 



ACT OP APRIL 24th, 1845. 

(LAWS 1845, CHAP. 87, p. 73.) 



An Act relative to purchasers at receivers' sales. Passed 
April 24, 1855. 



The People of the State of New Yorh represented, in 
Senate and Assembly, do enact as follows : 

Eeoeivers 8 1. Auv purchaser from the receiver of a banking: 

maytakaand , . 

Md real es- corporation of any chose in action belonging to the assets 
*of such corporation, may prosecute the same in liis own 
name ia all cases where by law, the same could be pros- 
ecuted in the name of such receiver. 



BANKING CORPORATIONS. 145 

ACT OP APRIL 28th, 1845. 

(LAWS 1846, CHAP. 112, P. 90.) 



An Act in relation to the Powers of Receivers and Com- 
mittees of lunatics and hdbiinial drunkards. Passed 
April 28th, 18i5. 

The People of the State of New Yorh, represented in 
Senate and Assembly, do enact as follows : 

§ 1. Any receiver appointed by virtue of an order or Eeoeivera 
decree of the court of chancery, may take and liold real mihoii 

reaL estate. 

estate upon such trusts and for such purposes as the court 
may direct, subject to the further order or direction of the 
court from time to time in relation to the disposition of 
such real estate. 

§ 2. Receivers and committees of lunatics and habit- po^erj of 
ual drunkards, appointed by any order or decree of the commiue™ 

of lunatics 

court of chancery, may sue in their own names for any ™d^ drunk- 
debt, claim, or demand transferred to them, or to tlie pos- 
session and control of which they are entitled as such re- 
ceiver or committee ; and when ordered or authorized to 
sell such demands, the purchaser thereof may sue and re- 
cover therefor, in his own name, but shall give such secu- 
rity for costs to the defendant, as the court in which such 
suit is brought, may direct. [See Laws 1844, chap. 239, 
p. 370, and Loajos 1846; chap. 97, p. 100.] 
10 



146 SPECIAL STATUTES APPLICABLE TO 

ACT OF APRIL 29th, 1847. 

(LAWS 184Y, CHAP. 160, P., 154.) 



An Act concerning the Election of Directors of Banking 
Associations. Parsed April 29th, 1847. 



The People of the Stats of New YorJe, represented in 
Senate and Assembly, do enact as follows : 

Subject to § 1. Every bankinsr association which has been, or 

the revised v j a J 

statutes. shall hereafter be formed or organized nnder the provi- 
sions of the act entitled " An Act to authorize the business 
of banking," passed April 18, 1838, or of any act amend- 
ing the same, shall be subject to the provisions of article 
two, title two, chapter eighteen, part one, of the Eevised 
Statutes. 

§ 2. This act shall take effect immediately. ( 58 ) 



ACT OP DECEMBER 4th, 1847. 

(LAWS 1847, CHAP. 419, P. 519.) 



An Act to amend an Act to Abolish the Office of Bank 
Commissioner, and for other pwposes, passed April 
18th, 1843. Passed Dec. 4cth, 1847, " three fifths leing 
present." 

The People of the State of New York, represented in 
Senate and Assembly, do enitct as follows : 

§ 1. The third section of the act entitled " An Act to 
abolish the office of bank commissioner, and for other pur- 

(58) See note 4, p. 1, ante; note 8, p. It, ante; and note 9, p. 22, ante. 



BANKING CORPORATIONS. 147 

poses," passed April 18, 1843, is laereby amended so as to 
read as follows : 

It shall be the duty of the comptroller, secretaiy oi^^^*y°^ 
state, and treasurer, on or before the first Tuesdays of Jan.lndt*rea"rer 
uary, April, July, and October in each year, to fix upon qnorteriy re- 
and determine some Saturday in the quarter of a year then 
ended, in respect to which every incorporated bank, bank- 
ing association and individual banker in the State shall 
make a report of the character hereinafter specified. Im- 
mediately after each determination of such Saturday, the 
oflScers 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 5, 1 846, or shall serve a copy of such notice upon 
each incorporated bank, banking association, and individ- 
ual 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 office, directed 
to each of such banks, banking associations, and individual 
bankers, or some officer thereof, at their places of business 
respectively. 

It shall be the duty of every incorporated bank, bank- 
ing association, or individual banker in the State, on or be-aJd'^h™ to 
fore the first days of February, May, August, and Novem- comptroller. 
ber of each year, to make and transmit to the comptroller 
a quarterly report, which report shall be made on the oath 
of the president and cashier, and shall contain a true state- 
ment of the condition of the bank, banking association, or 
individual banker making such report, before the transac- 
tion of any business on the morning of the day specified in 



148 SPECIAL STATUTES APPLICABLE TO 

the notice of the comptroller, secretary of state, and treas- 
urer, next preceding the date of .such report, in respect to 
the following items and particulars, to wit : 
Items to be Loans and discounts, over drafts due from banks, due 

reported. 

from the directors of the bank, or banking association 
making the report, due from brokers, real estate, specie, 
cash items, stocks and promissory notes," bills of solvent 
banks, bills of suspended banks, loss and expense account, 
capital, circulation (distinguishing that received from the 
comptroller from the old outstanding bills), profits, amount 
due to banks, amount dae to individuals and corporations 
other than banks, amount due to the treasurer of the State, 
amount due to commissioners of canal fund, amount due to 
depositors on demand, amount due not included under 
either of the above heads. And it shall be the duty of the 
comptroller to publish such reports together in the newspa- 
per published in the city of Albany in this section before- 
named, accompanied with a sunamary of the items of cap- 
ital, circulation and deposits, specie and cash items, public 
securities and private securities ; and the separate report 
of each bank, banking association, and individual banker 
shall be published in a newspaper published in the county ; 
if a newspaper is published in the city or town in which 
any bank is situated, stich publication shall be had in such 
paper in which such bank or banking association, or the 
banking house of such individual banker, shall be situated, 
at the expense of such bank, banking association, or indiv- 
idual banker. 

§ 2. Section four of the act in the first section of this 
act referred to, is hereby amended so as to read as follows, 
to wit : 
Keports The Comptroller shall pniblish the reports and summary 



BANKING CORPORATIONS. 149 

required by the third section of this act, together in oneandsum-^^^ 
paper, on or before the twenty-fifth day of August, No vem- Ji^hed!'"'' 
bar, February, and May in each year, and the expense of 
such publication shall be defrayed by a percentage as- 
sessed upon the capital stock of all the banks and banking 
associations and individual bankers doing business under 
the " act to authorize the business of banking," passed 
April 18th, 1838, or of any act amending the same, in the 
State ; and if any such bank, banking association, or indiv- 
idual banker shall fail to furnish to the comptroller its 
quarterly report in- time for such publication, it shall for- 
feit and pay to the comptroller the sum of one hundred 
dollars, to be applied by him to the payment of the ex- 
pense of publishing the quarterly reports ; and if any bank, 
banking association, or individual banker, shall neglect or 
refuse to make the quarterly report required by the third 
section of this act, for two successive quarters, it shall for- 
feit its charter (if an incorporated bank), and its privileges 
as a banking association or individual banker, if organized 
or doing business under the act of April eighteen, eighteen 
hundred and thirty-eight, in this section before referred to, 
and every such bank, banking association, and individual 
banker may be proceeded against, and its aflFairs closed, in 
any manner now required by law in case of an insolvent 
bank or banking association. 

§ 3. "Whenever iij the opinion of the comptroller, there ProviMon 

1111 1 1111. Incasesofin- 

shall be good cause to suspect that any bank, banking; as-^o^ect quar- 

° ^ ./ 7 o terly returns. 

sociation, or individual banker has made an incorrect or 
imperfect quarterly return, or is in an unsound or unsafe 
condition to do banking busAess, it shall be his duty to 
have the books, papers, and affairs of such bank, banking 
association, or individual banker, examined by some com- 



150 SPECIAL STATUTES APPLICABLE TO 

petent person to be designated by him, who shall examine 
fully into its books, papers, and affairs forthwith, and re- 
port to the comptroller on oath the result of such examina- 
tion, a copy of which report shall be forthwith published 
in the manner prescribed in the first and second sections of 
this act in respect to the publication of quarterly returns. 
The reasonable costs and expenses of every such examina- 
tion shall be defrayed in the manner prescribed in the sec- 
ond section of this act for paying the expenses of publish- 
ing quarterly returns. 
Bankers § 4:. All individual bankers, and all banldng associa- 

andaasocia- , i-i inn n t • ^ 

tions subject tions, which are now, or shall be hereafter engaged m the 

to taxation. ' ' ° ° 

business of banking under the provisions of the act entitled 
" An Act to authorize the business of banking," shall be 
subject to taxation on the full amount of actual capital 
paid in, or secured to be paid in, as such capital by them 
severally, at the actual market value of such securities to 
be estimated by the comptroller without any reduction for 
the debts of such individual banker or banking association. 
But in no case shall the capital of any such banking asso- 
ciation or individual banker, be estimated at a less sum 
than the amount of circuldtipg notes delivered to such 
banking association or individual banker and not returned 
to the comptroller ; and in case the capital of such banking 
association has been reduced by the surrender of any se- 
curities to the stockholders thereof, and the certificates of 
stock held on account of such securities being surrendered 
to such banking association and cancelled, such banking 
association shall not be subject to taxation upon such part 
of its capital. 
Saving § 5- Nothing in this act contained shall apply to any 

° ""°' bank or banking association which has reduced its capital 



BANKING CORPORATIONS. 151 

stock in violation of the twenty-eightli section of an act 
entitled " An Act to authorize the business of banking,"* 
passed April 18th, 1838. (59) 



ACT OP DECEMBER 13th, 1847. 

(LAWS ISil, CHAP. 462, P. 511.) 



An Act to repeal section fioe of iJie act entitled " An Act 
to amiend an act to abolish, the office of hanh com/mis- 
sioner, and for other purposes, passed December 4<A, 
1847." Passed Decembe/r ISth, 184Y. 



The People of the State of New York, represented in 
Senate and Assembly, do enact as follows : 

§ 1. Section five of the act entitled an act to amend an Eopeai. 
act entitled an act to abolish the office of bank commis- 
sioner, passed December 4th, 1847, which section reads as 
follows, to wit : " Nothing in this act contained shall apply 
to any bank or banking association, which has reduced its 
capital stock in violation of the twenty-eighth section of an 
act entitled an act to authorize the business of banking, 
passed April 18, 1838," is hereby repealed. 

§ 2. This act shall take efiect immediately. 

(59) This section repealed by the act of December 13, 184'7 (Laws 1847, 
chap. 452, p. h11). See this act, post. 



152 SPECIAL STATUTES APPLICAULE TO 

ACT OF APRIL 12th, 1848. 

(LAWS 1848, CHAP. 340, P. 462.) 



An Act amendatory of the act entitled, " An Act aniihoriz- 
ing, thehusiness of lamhing" passed April 18, 1838, 
and the acts amending the same. Passed April 12, 

1848. 



The People of the State of New York, represented in 
Senate and Assemih/, do enact as follows : 

§ 1. All banking associations, or individual bankers, or- 
andSyidl- g^'i^^®^ Under the provisions of the act passed April 18th, 
be bmks'of " 1838, entitled " An Act authorizing the business of bank- 

dlscoant and 

deposit. ing," and the several acts subsequently passed amendatory 
thereof, or which shall hereafter be organized, shall be 
banks of discount and deposit as well as of circulation ; and 
the usual business of banking of said associations, or indi- 
vidual bankers, shall be transacted at the place where such 
banking association, or individual banker, shall be located, 
agreeable to the location specified in the certificate 
directed to be made by the second clause of the sixteenth 
section of the act passed April 18th, 1838, hereinbefore 
mentioned, and not elsewhere ; and every report directed to 
be made by any law of this State from such association or 
individual banker, shall be verified by the oath of the pres- 
ident and cashier of such association, or such individual 
banker, that the business of said association, or banker, has 
been transacted at such location. But nothing in this sec- 
tion shall be deemed to repeal or modify the provisions of 
the act passed 4th May, 1840, entitled " An Act for the 



BANKINa CORPORATIONS. 153 

redemption of bank notes," as the same is applicable to all 
the banks, banking associations, or individual bankers of 
the State. 

§ 2. The securities which banking associations, or indi-^se^juntiea 
vidual bankers, hereafter to be organized under the provi- SSmptroTier. 
sions of the above recited act, passed April 18th, 1838, and 
the amendments thereto, shall deposit with the comptroller 
as security for the redemption of circulating notes issued to 
them by the said comptroller, shall be New York state 
stocks, in all cases to be or to be made to be equal to a 
stock producing six per cent, per annum, and it shall not be 
lawful for the comptroller to take such stocks at a rate 
above its par value or above its current market value : or 
the securities shall not be less than one half in such stocks 
and one half in bonds and mortgages upon improved, pro- 
ductive, unincumbered lands in this State, exclusive of any 
buildings thereon, said mortgages bearing an interest of 
not less than seven per cent, per annum, and to an amount 
not exceeding two-fifths the value of said lands. (60) 

§ 3. jSo mortgage hereafter to be deposited as security Amount in 

mortgages. 

as aforesaid, shall be for a greater amount than five thou- 
sand dollars each. 

§ i. The provisions of the first section of this act shall when, to. 

to apply. 

apply to the banking associations and individual bankers 
now organized as aforesaid, on and after the first day of 
June, eighteen hundred and forty-eight. 



(60) By § 10 of the act of April 12, 1851 (Laws 1861, chap. 164, p. 309), 
it is enacted that the provisions of § 2 of the above act shall extend, <fco., 
to hanking associations, &a , organized before the passage of the above chap- 
ter, 340. See this act, post. 



154 SPECIAL STATUTES APPLICABLE TO 

ACT OP MARCH 12th, 1849. 

(LAWS 1849, CHAP. 91, P. 136.) 



An Act to authorize the compfyroUer to issue registered notes 
in lieu of unregistered ones, in certain cases. Parsed 
March 12th, 1849. 



"J 



The People of the State of Nemo York, represented in 
Senate and Assembly, do enact as follows: 

nofel^£^ § 1. "Whenever any safety fund bank sball apply to tlie 
to be issued, comptroller for circulating notes, in lieu of those reported 
to the comptroller as unregistered notes in circulation by 
such bank on the. first day of July; one thousand eight 
hundred and forty-three, and the comptroller shall be satis- 
fied from the facts stated' by the president and cashier of 
such bank, on oath, that such unregistered notes so re- 
ported as in circulation on the day aforesaid, have prob- 
ably been lost or destroyed, he may issue to such bank 
notes in lieu thereof to an equal amount of those so lost or 
destroyed, the same as though such unregistered circulating 
notes had been returned to the comptroller's office. 
be^d^'^oBited § ^- ^^ ^^^^^ ^^ the duty of the comptroller to require 
of all banks asking for and receiving circulating notes 
under the provisions of the first section of this act, to de- 
posit in his office stocks of this State to be, or to be made 
to be, equal to a stock producing six per cent, per annum, 
equal to the amount of thie notes issued. 

§ 3. This act shall take effect immediately. 



BAJiTKING CORPORATIONS. 155 

ACT OP APRIL 5th, 1849. 

(LAWS 1849, CHAP. 226, P. 340.) 



An Act to enforce the responsibility of slookholders in cer- 
tain icmking corporations and associations, as pre- 
scribed by the constitution, and to provide for the 
prompt payments of demands against such corpora- 
tions and associations. Passed April 5, 1849. 



The People of the State of New YorTc, represented in 
Senate and Assembly, do enact as follows : 

§ 1. "Whenever default shall be made in the payment uabnityof 

stockholders 

of any debt or liability, contracted after the first day 'j/'tmotodlte' 
January, one thousand eight hvmdred and fift/y, by any ^S!^' 
corporation or 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, the stockholders of such corpora- 
tion or association shall be individually responsible, equally 
and ratably, such responsibility to be enforced as hereafter 
provided, and in no other manner, for the amount of such 
debt or liability, with interest, to the extent of their re- 
spective shares of stock in any such corporation or asso- 
ciation, as hereinafter provided. 

§ 2. The term "stockholder," as used in this act, shall Thetenn 

° ' ' stockholder 

apply not only to such persons as appear by the books of ^^y"™ '" 
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 every person who shall have advanced the, install- 
ments or purchase money of any stock in the name of any 



156 SPECIAL STATUTES APPLICABLE TO 

person under twenty-one years of age, and while such per- 
son remains a minor, to the extent of such advance ; and 
also to every guardian or other trustee who shall volun- 
tarily invest any trust funds in such stock ; and no trust 
funds in the hands of such guardian or trustee shall be. in 
any way liable under the provisions of this act 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 responsi- 
bility devolves upon the person beneficially interested 
therein ; and in respect to stock held by a guardian or 
other trustee under a transfer of the same by a third per- 
son, or under positive directions by a third person for such 
investment, the person making such transfer or giving 
such directions, and his executors and administrators, shall 
for the purposes of this act be deemed a stockholder ; and 
the estate of such person, if he be deceased, shall be re- 
sponsible for the debts and liabilities chargeable on such 
stock according to the provisions of this act* 
Liawiiiyof § 3. The persous who shall be stockholders of any cor- 
described in poratiou Or associatiou described in the first section of this 

the flrat sec- 

*'™- act, at the time of contracting any debt or liability by such 

corporation or association, shall be responsible therefor, as 
declared in the said first section, but shall be exonerated 
from such responsibility in respect to any stock which shall 
have been transferred, previous to any default in the pay- 
ment qf such debt or liability, on the books of such corpora- 
tion or association, to any resident of this State of full age, in 



BANKING CORPOEATIONS. 157 

good faitli and without any intent to evade such responsi- 
bility ; and every assignee of any stock so transferred pre- 
vious to such default, 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 by him as herein 
provided ; and the same rule of responsibility shall apply 
to each subsequent assignee. 

S 4. A book shall be provided and kept by every cor- Names of 

° - _ -^ r ,; ./ Btockholdere 

poration or association described in the first section of this r^ye^ea to 
act, in which shall be entered the names and residences ofabookT**" 
the stockholders in such corporation or association on the 
first day of January, one thousand eight hundred and 
fifty, and the names and residences of the original stock- 
holders of every corporation or association organized after 
the day last mentioned, so far as the same are known to 
the ofl&cers of the bank, the number of shares held by 
each stockholder, every registered transfer of stock upon 
the books of the bank after the said last-mentioned day, 
the names of the assignor and assignee, with their resi- 
dences and the number of shares transferred. The said 
book shall be at all times, during the usual hours of trans- 
acting business, open to public inspection. 

A neglect to provide and keep such book ready for ex- 
amination, as herein provided, shall subject the corpora- "^^lect. 
tion or association whose duty it is to provide and keep the 
same, to a penalty of one hundred dollars for every day's 
neglect. And a refusal by any officer of such corporation 
or association to exhibit such book to any person demand- 
ing the inspection thereof, as herein provided, shall sub- 
ject such officer to a penalty of fifty dollars. The said 



158 SPECIAL STATUTES APPLICABLE TO 

penalties 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 this State. In all 
proceedings under the provisions of this act, the said book 
shall be presumptive evidence of the truth of the contents 
thereof; but such presumption may be repelled by evi- 
dence, by any party or person interested in repelling the 
same. 
After 8 5. After the expiration of twenty days from the ser- 

twBDty days " ■*■ ^ </ 

be'entiSSto'^ice of any summons or complaint or declaration, or pro- 
derorrnieforceeding for the recovcry of any demand, against any cor- 
poration or association described in the first section of this 
act, upon any debt or liability exceeding one hundred 
dollars, contracted after the first day of January next, in 
which the precise sum demanded shall be stated, the 
plaintiff shall be entitled to enter an order or rule for 
judgment, upon filing such complaint or other proceeding 
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 or other proceeding 
has been served or not, unless an order shall have been 
filed in the office of the clerk where such judgment might 
be entered, 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 
disposed 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 defence on the 
merits to such demand or some part thereof, arising upon 
facts set forth in such affidavits. 



BAireiNG CORPORATIONS. 159 

§ 6. Upon tlie return of an execution against the prop- j,_jCoiT)ora-^^ 
erty of any corporation or association described in tbe first dLoWed. 
section of this act unsatisfied in whole or in part, or upon 
proof satisfactory to any 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 
cerporation or association. 

S 7. Any creditor of any such corporation or associa- AppUca- 

" "^ ^ X tion when to 

tion, having a demand exceeding one hundred dollars ^°„"'Ji',g3oio. 
arising upon a debt or liability contracted after the first 
day of January next [1850], the payment of which shall 
have been refused by such corporation or association, may 
at any time after ten days from the time of such refusal, 
apply to a justice of the supreme court for an order de- 
claring such corporation or association insolvent, 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 restraining such corpora- 
tion or association, and its oflicers, from paying out or in 
any way transferring or delivering to any person any 
money or assets of such corporation or association, or in- 
curring any debt or obligation until such order be vacated 
or modified. 

§ 8. Upon a hearing of the parties on such short Duty of 

judge on 

notice as the judge shall appoint, he shall determine "^J^^s "f 
whether such corporation or association be clearly solvent 
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 to be appointed by him. If 



160 SPECIAL STATUTES APPLICABLE TO 

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 the demand of the applicant be fully paid with his 
costs on such application, unless it shall have appeared by 
affidavit or otherwise that such corporation or association 
have a good defence on the merits to such demand. 
When to § 9- If the judgc determine that such corporation or 
der to re- associatiou is not clearly solvent, he shall make an order 

strain, "' 

declaring the same insolvent, and shall also by order re- 
strain such corporation or association and its officers from 
exercising any (^ its corporate rights, or any rights or 
privileges granted to it by law, and from collecting or re- 
ceiving any debts or demands, and from paying out, or in 
any way transferring or delivering to any person, any of 
its property, money or effects, until such order be va- 
cated ; and he shall immediately appoint a receiver of the 
property of such corporation or association. 
One or § 10. Auv oue Or more stockholders of any such cor- 

more Btock- u « t/ 

apply fo"aS poration or association owning stock to the amount of one 
ciaremJpora- tenth part of the capital thereof paid in, may at any time, 

tion insoi- 

Tent; jq h^q manner, apply to any justice of the supreme court 

for an order declaring such corporation or association in- 
- solvent, 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 injunction, as speci- 
fied in the seventh section of this act ; upon a hearing of 
the parties as soon as may be practicable he may require 
the exhibition to him, or to a referee to be appointed by 
him, of all the books, papers, accounts, assets, and effects 



BANKING CORPORATIONS. 



161 



of such corporation or association, and an examination of 
the ofl&cers, servants, and agents thereof, under oath ; and 
if he determine that such corporation or association is not 
clearly solvent, or that is in imminent danger of insolv- 
ency, he shall make an order declaring such determina- 
tion, and shall by order restrain the said corporation or 
association and its oificers, in the same manner as pro- 
vided in the ninth section of this act, and shall also ap- 
point a receiver of the property of such corporation or 
association. 

§ 11. Every receiver appointed according to this act, powers 

and duty of 

after giving security, shall take into his possession all the receivers, 
property, effects, books, papers, accounts, and demands of 
such corporation or association, incliiding the securities, if 
any, which may have been deposited with the comptroller, 
belonging to such corporation or association. He shall 
immediately give notice by publication in such news- 
papers as the comptroller or any justice of the supreme 
court shall direct, requiring the creditors of such corpora- 
tion or-association to exhibit and establish their demands 
before him within thirty days from the time of his ap- 
pointment. Snch receiver shall possess all the powers of 
receivers of corporations under the third article of title 
four of chapter eight and part third of tlie Rmised 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 powers 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. (61) 

(61) § 11 modified and amended by § 1 of the act of March 15, 1855 
11 



162 SPECIAL STATUTES APPLICABLE TO 

Securities s 12. Under the direction of the comptroller, all secu- 

wiien to be *J ^ ' 

S'clsh.'^*"^"rities deposited with him belonging to such corporation or 
association, shall be converted into cash by the receiver, 
with the least possible delay ; and the receiver shall also 
convert into cash the eflPects and demands of such corpora- 
tion or association, and for that purpose may sell at auc- 
tion any 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 

to^'mSf^ time be enlarged by a justice of the supreme court, which 

may be done for a period not exceeding ninety days, such 

receiver shall declare a dividend of the cash in his hands 

among the creditors of such corporation or association. 

Expenses 8 13. Bcforc making such dividend, the receiver shall 

to he deduct- " ° ' 

mawn?divi- deduct and retain the sums necessary to defray the ex- 
penses 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 or 
levy, under execution or attachment. He shall then 
apply the money in his hands to the payment of the bills 
or notes held by bill holders of such corporation or as- 
sociation who shall have presented the same, in just and 
equal proportions. If any surplus remain, he shall divide 
and pay the same to and among the creditors of such cor- 
poration or association having demands founded on any 
debt or liability contracted after the first day of January, 
one thousand eight hundred and fifty, whose demands 
shall have been ascertained, in proportion to their respec- 
tive demands ; and if any further surplus remain, he shall 
divide and pay the same to and among all other creditors 
of the said corporation or association whose demands shall 

(Laws 1855, chap. 69, p. 101). See this act, 'post. See provisions of the 
Hevised Statutes, above referred to, p. 59 — 64, and p. 68 — T3, ante. 



BANKING CORPORATIONS. 163 

have been ascertained, in proportion to their demands re- 
spectively. Such payments to creditors shall be made in 
the order prescribed by law in respect to the duties of re- 
ceivers of corporations. 

§ 14. If there shall remain unsatisfied any debts or lia- Report to 

'^ be made in 

bilities of such corporation or associatiori contracted after ^^^'^[""ae^ 
the first day of January, one thousand eight hundred and 
fifty, the receiver shall, within thirty days after tiie declar- 
ation of the said 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 busi- 
ness of such corporation or association was conducted, a 
particular account of the said debts and liabilities so re- 
maining unsatisfied, and a preliminary account of all his 
proceedings, under oath, in which shall be set forth the 
amount of cash realized by him, the expenses and allow- 
ances claimed by him, all payments that he may have 
made, the amount on hand to be divided, and the divi- 
dends declared by him. 

§ 15. The said receiver shall at the same time report List of 

stockholders 

• and submit to such justice a true and accurate list and 'gJi^af' 
statement of the persons who, since the first day of January, 
one thousand eight hundred and fifty, were 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. 

§ 16. The said iustice shall thereupon refer the said re- Eeportand 

° "* '■ list to be re- 

port and list of stoclNholders to a referee, to be appointed f'™* to ref- 

by him, with directions, after giving notice to all persons 



164 SPECIAL STATUTES APPLICABLE TO 

concerned, to apportion the debts and liabilities of such 
corporation or association contracted after the first day of 
January, one thousand eight hundred and fifty, and re- 
maining unsatisfied among the said stockholders, ratably 
in proportion to their stock, according to the principles in 
this act declared, and to report his proceedings to such jus- 
tice, or some other justice of the supreme court in the same 
district. 
Hearing, § IT. The Said referee shall cause notice of his appoint- 

Tvhen to be " *■ ^ 

therefSS. ment, and the time and place of hearing on the matters so 
referred to him, to be given to each stockholder whose 
name appears on the said list at least ten days before such 
time, which notice shall be served on such 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 situated, either personally 
or by leaving A copy thereof at the residence of such stock- 
holder, with some person of suitable age, and such notice 
may be served upon all other stockholders, by publishing 
the same in one advertisement, containing 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. 
Aiiega- § 18. On such hearing the said referee shall hear the 

tlODSand -t n n it ' t 

proofs or all allegations and proofs oi all parties and persons interested 

Heard. ^^ ^j^g matter referred, and particularly shall ascertain the 

persons who are chargeable as stockholders for the debts 

and liabilities contracted as aforesaid, and the amount 

chargeable to each according to the rules and principles 



BANKING COEPORATIONS. 165 

declared in this act. At the first special term of the su- 
preme court held in the county in which such receiver re- 
sides, or in an adjoining county, after the expiration of six 
weeks from the time of his appointment, such referee shall 
report to the justice holding such term, the apportionment 
of the debts 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 to enable the said referee to complete the appor- 
tionment directed, or to take further proof in reference to 
the same, he may grant such further time not exceeding 
ninety days. 

§ 19, On the final completion of such apportionment, the Apportion- 
ment when 

same shall be reported at a special term of the supreme ^*'°J®p"''" 
court, as hereinbefore directed, and on the coming in of ''"™ ™" ' 
any such report, the justice holding such term shall pro- 
ceed 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. If there be a further reference, notice of hear- 
ing thereon may be given by a general 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. 

§ 20. When the report of a referee, made according toEeportwhen 

to be filed in 

the preceding sections of this act, shall have been confirmed Jerk's office. 
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 oflBce of the clerk of such county as shall be directed 
by such justice ; and unless an appeal be allowed and 



166 SPECIM, STATUTES APPLICABLE TO 

entered tterefrom as hereinafter provided, the said order 
of confirmation shall be final as a judgment against %ach 
stockholder for the amount found chargeable against him ; 
and one or more executions thereupon may be issued against 
any one or more of the stockholders named in such report 
or order, for the sum or sums 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 receiver, 
be'duded" § ^^" '^^ money so collected, after deducting all ex- 
penses of proceedings, shall be without delay divided, 
distributed, and paid over to the creditors of such corpora- 
tion or association, in the same manner as hereinbefore 
provided in relation to the first dividend, by the said re- 
ceiver. 
Necessary § 22. The iusticc to whom any report by a receiver or 

expenses to *^ v ./!.■/ 

be allowed. ^^ ^ referee shall be made as herein provided, shall as- 
certain and allow tbe necessary expenses attending the 
execution of their duties, including the hire of such and so 
many clerks and such professional assistance as may ap- 
pear 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 
five dollars for each day actually employed, as he shall 
deem 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. 
Dividends § 23. Neither the dividends herein directed to be made, 

and appor- 

no"to b'e'^ae- ^'''' *^® apportionment of the debts of such corporation or 
o°MyeMr"* association among the stockholders thereof, shall be de- 



BANKING CORPORATIONS. 167 

layed or suspended by reason of the pendency of any liti- 
gation 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 business of such 
corporation or association was conducted ; and such delay 
shall in no case exceed one year, and if at the time of de- 
claring any dividend, there shall be any prosecution pend- 
ing 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 expenses 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 stockholders. 

§ 24. If after paying and discharging the debts and After pay- 
liabilities of such corporation or association as herein pro- ^ta"hol°aiE- 
vided, and defraying all the expenses of the proceedings, 
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 hereinbefore 
directed, and shall be paid to the stockholders upon whoni 
any such debts or liabilities were apportioned in just and 
equal proportion to the sums contributed and paid by 
them. 

§ 25. No appeal from any determination or order of a Appeal not 

to suspend or 

iustice of the supteme court, made pursuant to the fifth, i^eiayesecu- 

'f sr 7 r J tion pursuant 

sixth, seventh, eighth, and ninth sections of this act, shall seoS?." 
suspend 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 certificate of a 
justice of the supreme court, to the effect that there is 



168 SPECIAI, STATUTES APPLICABLE TO 

probable error in such order or determination, nor unless 
. security be given satisfactory to such justice for the pay- 
ment of the demand upon which the proceedings in those 
sections may be founded, whenever judgment shall be 
rendered therefor, with interest at the rate of ten per cent, 
and costs. 
Under sec- § 26. No appeal from any order or determination made 

tiott ten. 

pursuant to the tenth section of this act, shall suspend or 
delay the execution of such order or the effect of such de- 
termination, 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 pre- 
ceding section, nor unless security be given satisfactory to 
the justice granting such certificate to indemnify the 
stockholders upon whose application such order or 
determination was made, against all damages, costs, ex- 
penses and losses by reason of any debt or liability of 
such corporation or association created after the first day 
of January, one thousand eight hundred and fifty. 
No refer- § 27. No appeal can be made fiom any order of any 

6nG3 to VQ^ 

eree. justlcc of tlio Supreme court under this act referring any 

matter to a referee. 
Appeal § 28. An appeal from the determination of a justice 

by receiver, 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, may be 
taken by the receiver of such corporation or association, 
or by any one or more of the stockholders 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 



BANKING CORPORATIONS. ' 169 

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 necessary for a re- 
ceiver so a^pl/ying* to give any security for costs or other- 
wise. 

§ 29. If any such determination or judgment shall be Newap- 

portionment 

reversed or modified so that a new apportionment of such "^"^ *" ^^ 
debts and liabilities shall become necessary, the court in 
which such reversal or modification shall be made, shall 
direct a new apportionment, and the matter shall be re- 
mitted 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 are herein pro- 
vided in relation to the original apportionment. 

S 30. Every security taken under the provisions of this securities 

<^ ■! •! r - where to be 

act shall be filed with such clerk of the supreme court, as *'^''' 
the justice taking the same shall direct ; and the same 
may be enforced by suit in the name and for the benefit of 
any person for whose benefit or indemnity the same was 
taken. 

§ 31. Any creditor of any such corporation or associa- Eight of 

creditors 

tion who shall have neglected to present his demand to the who negieot 

o 1. to present 

receiver before the first or subsequent dividend, and whomladt*' 
shall present the same before the second or any other sub- 
sequent dividend, shall receive the sum he would have 
been entitled to on any former dividend, before any distri- 
bution be made to other creditors. 

§ 32. Every issue of fact or of law joined in any suit certain is- 
against any corporation or association described in the first or law joined 

° ./ r In suit, to 

section of this act, upon any debt or liability contracted e^/ncf* 



* So in the original. 



170 SPECIAL STATUTES APPLICABLE TO 

after the first day of January, one thousand eight hundred 
and fifty, or against any receiver of such corporation or 
association, or by any such receiver under the provisions 
of this act, shall have preference at the court at which it 
shall be noticed for trial or argument, to all other causes ; 
and every case made, special verdict rendered, bill of ex- 
ceptions and demurrer to evidence taken on such trial, and 
every issue of law joined on the pleadings in any such 
suit, and every appeal from any order or determination, 
judgment or decree made or rendered under the provisions 
of this act, and every special motion relating to any pro- 
ceedings had under this act, shall have a preference in the 
hearing and argument thereof in any court where the same 
may be pending. 



ACT OP APRIL 10th, 1849. 

(LAWS 1849, CHAP. 313, P. 455.) 



An Act amendatory of the aot entitled ^^An Act to author- 
ise the Business of Bankmg^'' passed April 18, 1838, 
and the acts amendrng the same. Passed April 10, 1849. 

The People of the State of New Yorh, represented ^in 
Senate and AsserrMy, do enaot as follows: 

stocks to § 1. The stocks which banking associations, or individ- 
witttmp- ual bankers, now or hereafter to be organized under the 
provisions of the act " To authorize the business of bank- 
ing," passed April 18, 1838, and the amendments thereto, 
shall hereafter deposit with the comptroller, shall be New 



BANKING CORPORATIONS. 171 

York state stocks, in all cases to be, or to be made to be, 
equal to stock producing six per cent, per annum, or at 
least one half the amount so deposited shall be in the 
stocks of the State of New York, as before mentioned, and 
not exceeding one half in stocks of the United States, in 
all cases to be, or to be made to be, equal to a stock pro- 
ducing an interest of six per cent, per annum ; and it shall 
not be lawful for the comptroller to take such stocks at a 
rate above their par value, or above their current market 
value. 

S 2. The shareholders, or a maiority of them in amount, comptroi- 
who shall be owners of any incorporated bank continuing}^*™ "teTto" 
the business of banking until the expiration of their char-"^'"'^ °'^' 
ter, and who shall have associated themselves for the pur- 
pose of banking, under the provisions of the "Act to 
authorize the business of banking," passed April 18, 1838, 
and the amendments thereto, shall be entitled to receive 
from the comptroller, who is hereby authorized to issue to 
the association so formed, circulating notes in amounts of 
not less than ten thousand dollars, upon the deposit of se- 
curities of the kind described, required by the provisions 
of the above-mentioned act, and the amendments thereto, 
to an amount equal to the circulating notes so issued. But 
if such banking association so formed shall not have depos- 
ited with the comptroller daring the three years next fol- 
lowing the date of their articles of association an amount 
equal to that now required by law of banking associations 
as security for circulating notes previous to commencing 
the business of banking, the comptroller is hereby em- 
powered to retain the interest accruing upon securities so 
deposited until such association has complied with the pro- 



172 SPECIAL STATUTES APPLICABLE TO 

visions of the act above recited, in relation to the amount 
of security to be deposited in the office of the comptroller. 
tiotrhw § ^" ^^ *^® shareholders, or a majority of them in 

ex™ra«on*of amount, of any incorporated bank, within one year of the 
expiration of its charter, shall file with the president 
thereof a notice in writing, that they intend to avail them- 
selves of the provisions of the second section of this act to 
associate for the purpose of banking, it shall be lawful for 
the directors of said bank to purchase and hold such stock 
and other securities as the comptroller is or may be author- 
ized to receive for circulating notes under the provisions 
of the act to authorize the business of banking, passed 
April 18th, 1838, and the various acts amending the same, 
to such an amount as they shall deem for the interest of 
the shareholders thereof. 
ProviBion 8 4. An association heretofore or hereafter formed to 

relative to ^ 

fnOTrpOTated'^take the place of an incorporated bank whose charter has 

bnnks. 

expired or is about expiring may, where all the stockhold- 
ers of such incorporated bank have assented to its organiza- 
tion under the act to authorize the business of banking, 
take and hold in addition to such real estate as is prescribed 
by the twenty-fourth section of the act to authorize the 
business of banking, such other real estate as at the time 
of the transfer of the property of the incorporated bank, 
having been received by it in payment of debts previously 
contracted to said bank, or purchased by it under judg- 
ments, or decrees in chancery in favor of said incorporated 
bank, according to law. 



BANKING CORPORATIONS. 173 

ACT OP APRIL 11, 1849. 

LAWS 1849, CHAP. 437, P. 613.) 



An Act to amend cm Act relatwe to JJncla/imed Bank div- 
idends and deposits, passed May 9, 1835, and for other 
purposes. Passed April 11, 1849. 

The People of the State of New Yorh, represented in 
/Senate and Assemibly, do enact as follows : 

§ 1. Every company or association now or hereafter in- statement 

"^ •! r J ^ ^ of unclaimed 

corporated or organized, or doing business under any gen- J'/S,*hed. 
eral or special law of this State, on or before the first day 
of September next and annually thereafter, shall cause to 
be published for six successive weeks in one public news- 
paper printed in the county in which such company or 
association may be located, and in the state paper, a true 
and accurate statement verified by the oath of the cashier, 
treasurer, or presiding ofiicer, of all deposits made with 
said company or association, and of all dividends and inter- 
est declared and payable upon any of the stock, bonds, or 
other 'evidence of indebtedness of said company or associa- 
tion which at the date of such statement shall have re- 
mained unclaimed by any person or persons authorized to 
receive the same for two years then next preceding. 

§ 2. Such statement shall set forth the time that every statement 

" ^ how to be 

such deposit was made, its amount, the name and the resi-™*^*" 
dence, if known, of the person making it, the name of the 
person in whose favor the dividend or interest may have 
been declared, its amount, and upon what number of shares, 
and on what amount of stock, bonds, or other evidence of 
indebtedness of any such company or association. 



17i SPECIAL STATUTES APPLICABLE TO 

ciMtoT"''"" § 3. The term "association " shall include every indiy- 
idnal doing business alone, under any general or special 
law of this State. 



ACT OF APRIL 10th, 1850. 



(LAWS 1860, CHAP. 251, P. 486.) 



An Act to cmhend ths act entitled " An act to amend the 
act entitled an act to anithorize the business of tanhing" 
passed May 14, 184:0. Passed April 10, 1850. 



The People of the State of New- York, represented in 
Senate and Assembly, do ena^t as follows : 

§ 1. The fourth section of the act entitled, " An Act 
to amend an act entitled ' An Act to authorize the business 
of banking,' " passed May 14, 1840, is hereby amended 
so to read as follows : 

No banking association or individual banker as such, 
shall issue or put in circulation any bill or note 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 jurisdiction of the United States, which 
bills may be made payable at or within the customary 
usance, or at or within ninety days' sight, and every viola- 
tion of this section by any officer or member of a banking 
association, or by any individual banker, shall be deemed 
and adjudged a misdemeanor, punishable by fine or im- 



BANKING CORPORATIONS. 173 

prisonment, or both, in the discretion of the court having 
cognizance thereof. .( 62 ) 

§ 2. This act shall take effect immediately. 



ACT OP APRIL 10, 1850. 

(LAWS 1850, CHAP. 331, P. 726.) 



An Act to provide for a final (Mstribution of the funds 
held hy the comptroll&r^ helonging to the creditors of in- 
solvent hcmks a/nd hcmkers. Passed April 10, 1850. 



The People of the State of New YorTe, represented in 
Senate am,d AssenMy, do enact as follows : 

§ 1. It shall be the duty of the comptroller to make a rinai dis- 
tribution. 
final distribution of the funds in his hands arising from the 

sale of securities deposited with him under the act to 
authorize the business of banking, by associations or in- 
dividual bankers which have failed or may hereafter fail to 
redeem their circulating notes, which distribution shall be 
made in the manner herein prescribed. At the expira- 
tion of six years after the first sale made by the comp- 
troller, of the securities of any such insolvent banking as- 
sociation or individual banker, the comptroller shall issue 
a final notice to the holders of the circulating notes issued 
by such banking association or individual banker, requir- 

(62) See §35 of the act of 1829, p. 38, ante, and Note 14; also § 4 of 
the act of May 14, 1840, p. 114, ante, and Note 51, pp. 114 — 122, ante. 



1V6 SPECIAL STATUTES APPLICABLE TO 

ing the presentation of such notes within six naonths after 
the date of said notice ; and any of snch circulating notes 
which shall not be presented within the time thus specified 
shall cease to he a charge or claim upon the funds of said 
banking association or individual banker remaining in the 
hands of the comptroller. Any of such circulating notes 
which shall be presented within the period above limited, 
shall be received and paid by the comptroller, at the same 
rate which shall have been paid on like notes previously 
presented ; 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 associa- 
tion 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. 

§ 2. At the expiration of the notice of six months re- 
quired to be given, by the preceding section, the comp- 
troller shall ascertain the amount of the residue of the fund 
remaining in his hands belonging to the creditors of such 
insolvent association or banker ; and after deducting 
therefrom all expenses justly chargeable thereon, he shall 
make a pro-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 comptroller 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 ; and 
any of said certificates which shall not be presented with- 



BANKING CORPORATIONS. 177 

in the time thus specified shall cease to he a charge or 
claim upon the residuary fund in the hands of the comp- 
troller. 

§ 3. After making the final distribution directed in the unclaimed 

fond. 

last preceding section, if any portion of said fund shall re- 
main unclaimed, the same shall be deposited in the treas- 
ury, and applied towards paying the ordinary expenses of 
the free banking department. 

§ 4. The notice required to be given by this act to the Notice. 
creditors of insolvent banking associations or individual 
banker^ shall be published at least six weeks, in one or 
more newspapers which the comptroller 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. 

§ 5. This act shall take effect immediately. 



ACT OP MARCH 29, 1851. 

(LAWS 1861, CHAP. 68. P.^S.) 



An Act to amend the act entitled "An act to authorize 
the business of banking" passed May 26th, 1841. 



Passed Ma/rch 29, 1851. 



The People of the State of New York represented in 
Senate amd Assemih/, do enact as follows : 

§ 1. Section nine of chapter three hundred and nine- 
teen, laiws of eighteen hundred and forty-one, being an act 
to amend the act entitled " An act to authorize' the busi- 
12 



178 SPECIAL STATUTES APPLICABLE TO 

mess of "banking," passed May 26, 1841, is amended so as 
to read as follows : 
securittes 8 9. Such association or indi\ddual banker, after hav- 

when to be- 

by'tiiT* "^ i°g complied with the provisions of the preceding section, 
oomp ro er. ^^^ after having given notice in tte State paper for two 
years, and also for the same length of time in at least one 
newspaper printed in the county where the said associa- 
tion or bank fihall have been located, stating that all cir- 
culating notes issued by such association or bank are 
required to be presented to the comptroller for payment 
within two years from the date of such notice, and on 
giving a bond with three or more sureties, which bond 
shall be satisfactory to the comptroller, conditioned for 
the prompt redemption whenever presented within six 
years from its date -of all outstanding notes of such associ- 
ation or individual banker, shall then be entitled to re- 
iceive from the icomptroller all other securities which he 
may bold for the payment of any unredeemed notes of the 
said association or bank. 



ACT or APRIL 12th, 1851. 

(LAWS 1851, CHAP. 164, P. 309.) 



An Act to organize a Bcmk Department. Passed April 
12, 1851, " three-fifths levng present.''^ 



The People of the State of New Yorle, represented in 
Senate amd AssemMy, do enact as follows : 

Bank de- § 1. There is hereby established a separate and distinct 

partmeut. 

department which shall be charged with the execution of 
the laws heretofore passed, or that may be hereafter passed 



BANKING CORPORATIONS. 179 

in relation to the banks whicli are subject to the act to 
create a fund for the benefit of the creditors of certain 
moneyed corporations, and for other purposes, passed April 
2, 1829, or in relation to banking associations and indi- 
vidual bankers, formed or transacting business under the 
act to authorize the business of banking, passed April 18, 
1838, and the several acts in addition to or amendatory 
thereof. 

§ 2. The chief ofiicer of the said department shall be superin- 

tendent. 

denominated the superintendent of the banking depart- 
ment. He shall be appointed by the governor, by and 
with the advice and consent of the senate, and shall hold 
his office for the term of three years. He shall receive an sbi^^. 
annual salary of two thousand five hundred 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 treasury ; 
he shall appoint one of the said clerks to be his deputy, his deputy. 
who shall possess the powers and perform the duties at- 
tached by law to the office of the principal during a va- 
cancy 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 pre- office, 
scribed by the constitution, and file tie same in the office 
of the secretary of state, and the said officers shall be in 
all respects subject to the provisions of the sixth title of 
chapter five of the first part of the Revised Statutes, so far 
as the same may be applicable. And the said superin- 



ent. 



180 SPECIAL STATUTES APPLICABLE TO 

tendent of the banking departmeAt shall give to the people 
^™*- of this State a bond in the penalty of fifty thousand dol- 
lars with two sureties to be approved by the comptroller 
and treasurer of this: State, conditioned for the faithful dis- 
charge of the duties of his office, and the said superintend- 
ent shall not, either directly or indirectly, be interested in 
any bank or banking association, or as an individual 
banker. 
s/°rTntoid' § ^- '^® superintendent of the banking department 
shall possess all the powers, perform all the duties, and be 
subject to all the obligations and penalties now conferred 
by law upon the comptroller of this State, or to which the 
comptroller is subject in relation to banks, incorporated 
and banking associations formed, and bankers transacting 
business under the laws specified in the first section of this 
act, and the said laws and all acts amendatory thereof, or 
in addition thereto, are hereby modified and amended, so 
that every power and duty thereby conferred on the comp- 
troller, shall from and after the appointment of such 
superintendent, be transferred to and conferred upon the 
said superintendent subject to the modifications contained 
in this act. 
Seal. § 4. The said superintendent with the approval of the 

governor, shall devise a seal with suitable inscriptions for 
his office, a description of which with a certificate of ap- 
proval by the governor shall be filed in the office of the 
secretary of the State with an impression thereof, which 
shall thereupon be and become the seal of officie of the 
superintendent of the banking department, and the same 
may be renewed whenever necessary. Every certificate, 
assignment, and conveyance executed by the said superin- 
tendent in pursuance of any authority conferred ou him 



BANKING CORPORATIONS. 181 

by law, and sealed with his said seal of office shall be re- 
ceived in evidence, and may be recorded in the proper re- 
cording offices in the same manner, and with the like effect 
as a deed regularly acknowledged or proved before an 
officer authorized by law to take the proof or acknowledg- 
ment of deeds, and all copies of papers in the office of 
the said superintendent certified 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. 

§ 5. All plates for bank bills deposited with the comp- Papers, 

^ bills, &e. to 

troUer, all papers for bills, all securities, stobks, honds^^^^l™^^-^^, 
and mortgages, and all other papers whatever in the comp- ent°'°''* 
troUer's office relating to the business of the banking de- 
partment, shall on demand be delivered and transferred to 
the superintendent thereof, and be and remain in his 
charge and custody. 

§ 6. There shall be assigned to the said superintendent Eoomsand 
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 
business ; the expense of which shall be paid on the cer- 
tificate of the superintendent, and the warrant of the 
comptroller in the first instance out of the treasury. 

§ T. All the expenses incurred in and about the con- Expenses 

how oefray- 

ducting the business of the said department, including the '*■ 
salary of said superintendent and his clerks, shall be de- 
frayed and paid by the incorporated banks, banking asso- 
ciations, and bankers in whose behalf they are incurred. 



182 SPECIAL STATUTES APPLICABLE TO 

The expenses incurred, and services performed, specially 
for any incorporated bank, banking association, or banker, 
including tlie delivery of new bank bills for sucb as may 
be returned, and the destruction of the latter, shall be 
charged to such incorporated bank, banking associations, 
or banker, and all other expenses of the said department, 
shall be charged to the said incorporated banks, banking 
associations and bankers, in such proportions as the said 
superintendent shall deem just and reasonable. If such 
charges are not paid after due notice, the superintendent 
may apply the dividends on any stock, or the interest on 
any bonds and mortgages in his hands deposited , by the 
bank, banking association, or banker, so neglecting; to 
make the payment of such , charges with interest at the 
rate of seven per cent. ; 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 bank 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, association, or banks, for the recovery of 
such charges, and the sums collected therein shall be paid 
into the treasury, and neither the said superintendent nor 
any clerk or person employed in his office shall take or 
receive directly or indirectly, any compensation or pay for 
any services or extra services rendered in the banking de- 
partment, other than the compensation allowed by law ; 
and any person violating this provision, shall be deemed 
guilty of a misdemeanor. 
§uof § 8_ TJie provisions of the fourteenth section of the 



BANKING CORPORATIONS. 183 

"Act to authorize the business of banking," passed April j»'nfAprii 
eighteenth, eighteen hundred and thirty-eight, are hereby- 
extended to the said superintendent and the officers and 
clerks employed in the bank department. See § 14, p. 91, 
ante. 

§ 9. Instead of the comptroller, secretary of state, and ^a^^f^j °' 
treasurer, it shall be the duty of the superintendent of the 
bank department to fix upon and determine a day in re- 
spect to which the reports of incorporated banks, banking 
associations and individual bankers, shall be made as pro- 
vided in chapter four hundred and nineteen of the Session 
Laws of one thousand eight hundred and forty-seven ; and 
the said superintendent shall, at least once in each quarter 
of a year, fix and designate some Saturday in each preced- 
ing quarter in respect to which the said reports shall be 
made, and shall give notice thereof in the manner pre- 
scribed in the said chapter, four hundred and nineteen ; 
and the said reports shall be made to the said superintend- 
ent as directed in the said chapter, and all willful false 
swearing in respect to such reports shall be deemed per- 
jury, and subject to the punishments prescribed by law for 
that ofience. In case of neglect to make such report 
within one month from the time required, it shall be the 
duty of the superintendent to cause the books, papers, and 
afi"airs of the bank, association or banker, so neglecting, to 
be examined as directed by the third section of the said 
chapter four hundred and nineteen; and the reasonable 
expenses of such examination to be certified by the said 
superintendent shall be charged to the bank, association, 
or banker so neglecting, and shall be collected in the man- 
ner herein prescribed in respect to other charges against 
them. 



184: SPECIAIi' STATUTES APPLICABLE TO 

how'to'^''' § ^^- '^^ provisions of the second section of the act 
'"'^ chapter three hundred and forty of the laws of eighteen 

hundred and forty-eight, amending the "Act authorizing 
the business of banking," shall extend and be applicable 
to banking associations and individual bankers organized 
before the passage of the said chapter three hundred and 
forty, as well as to those organized subsequently ; but no 
one mortgage of lands shall hereafter be received as secu- 
rity for circulating bills to an amount greater than five 
thousand dollars ; and any mortgage heretofore received 
or hereafter received fpr circulating bills, may be held by 
the superintendent of the banking department for the full 
nominal amount thereof notwithstanding a less amount of 
bills may have been or shall be delivered upon the deposit 
of such mortgage, and the whole nominal amount of such 
mortgage may be collected by any purchaser thereof in 
case it shall be necessary to. sell such mortgage at its 
nominal amount to meet the liabilities of the banking 
association or banker by whom it waa deposited ; but the 
same may be sold as for the amount of bills delivered upon 
its deposit when there is no deficiency of other means to 
meet the said liabilities. 
^Annual re- g jj_ j^ gj^^^ ^^ ^^^ ^^^^ ^f ^.j^^ Superintendent of the 

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 in- 
corporated bank, banking association and individual banker, 
from whom reports have been received the preceding 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 



BANKING CORPORATIONS. 



185 



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 re- 
lation to said banks, associations and bankers, as in his 
judgment may be useful : 

2. A statement of the banking associations and bankers 
whose business has been closed during the year, with the 
amount of their circulation redeemed and the rate of such 
redemption per cent, and the amount outstanding ; 

8. 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 sliall be in advance : such report 
shall be made by or before the last day of the year, and 
the usual number of copies for the use of the legislature, 
and two hundred and fifty copies for the use of the depart- 
ment, shall be printed in readiness for distribution on the 
meeting of the legislature by the printer employed to print 
legislative documents, the expense of which shall be 
charged among the general expenses of the department, 
and collected as herein provided. 

§ 12. This act shall take effect immediately. 



186 SPECIAL STATUTES APPLICABLE TO 

ACT OP APRIL 17, 1851. 

(LAWS 1861, CHAP. 20S, P. 315.) 



An Act to amend the s&oe/ral acts relating to Incorporated 
JBamJes, Banhmg Associations, amd Individual Ba/nk- 
errs. Passed April 17, 1851. 



the People of the State of New York represented in 
Senate cmd Assembly, do enact as follows : 

offlossof § 1- Section one of the act relating to the redemption 
of bank notes, passed May 4th, 1840, is hereby amended 
so as to read as follows : 

§ 1. Every moneyed incorporation in this State having 
banking powers, and issuing bills or notes of circulation, 
and every banking asspciation and individual banker 
carrying on banking business under the act to author- 
ize the business of banking, except those whose place of 
business is in the cities of New York, Albany,, Brooklyn, 
or Troy, shall, on or before the first day of July next, 
appoint an agent, who shall keep an office in the city of 
New York, Albany, or Troy, for the redemption of all cir- 
culating notes issued by said corporation, banking associa- 
tion, or individual banker, which shall be presented to 
such agent for payment or redemption. 

§ 2. Section four of the said act is hereby amended so 
as to read as follows : 

■feaie of § 4. It shall be the duty of every such corporation, 

banking association, and individual banker out of the 
cities of New York, Albany, Brooklyn, and Troy, to re- 



BANKING CORPORATIONS. 187 

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 cent. 

§ 3. Whenever any action shall be brought against Demand 

° •' b b and protest 

any incorporated bank, banking association, or individual ^en™^*^' 
banker, for the recovery of the amount due on any circu- 
lating note or notes registered in the comptroller'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 banking asso- 
ciation 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, association, or banker in 
the city of New York, Albany, or Troy, or either of the 
same, for the amount of the circulating note or notes so 
presented, with an affidavit, if required, that such draft or 
drafts is or are available to their full amount, to insure the 
immediate payment thereof on presentation, or in case 
any action shall be commenced upon such note or notes 
before the expiration 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 prepared to redeem such note or notes in the lawful 
money of the TTnited States, at the counter or ordinary 
place of business of such bank, association, or banker, at 
the expiration of said fifteen days fi-om the time of the first 
demand thereof, with interest, then in either case, the 



188 SPECIAL STATUTES APPLICABLE TO 

plaintiff in such action shall not recover any costs, fees, or 
disbursements whatever against the defendants, and shall 
be entitled to recover no more than seven per cent, inter- 
est, in lieu of all damages for the non-payment of the said 
circulating note or notes ; but no interest shall be recov- 
ered 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 or ordinary place 
of business of such defendant, on or after the fifteenth day 
after such first demand, and before the twentieth 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 pre- 
sentation of said circulating note or notes, shall have of- 
fered 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 banking house or ordinary place of 
business, then such bank, association, or b&nker shall not 
be deemed to have suspended or refused specie payment, 
within the meaning of any statutes authorizing proceedings 
for the dissolution of the charter of such bank, or authoriz- 
ing proceedings to restrain or enjoin the ordinary business 
of such bank, association,, or banker, nor shall such bank, 
association, 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. 
Notes how § 4. The fourth section of chapter two hundred and 

protested. 

sixty of the laws of eighteen hundred and thirty-eight as 



BANKING CORPORATIONS. 189 

amended by the first section of chapter forty-six of the 
laws of eighteen hundred and forty-oue, is hereby further 
amended so that it shall read as follows: 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 hours 
of busiifess, 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, tlje 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 oflSce, 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 pur- 
suance of such offer, make, sign and deliver to the party 
making such demand, an admission- in writing, stating the 
time of the demand, the amoimt demanded, and the facts 
of the non-payment thereof, and the comptroller, on re- 
ceiving and filing in his office such admission or protest, 
together with such note or notes, shall forthwith give 
notice in writing to the maker or makers of snch note or 
notes to pay the same ; and if he or they shall omit to do 
so for fifteen 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 notes, to the payment pro rata, of all the 



190 SPECIAL STATUTES APPLICABLE TO 

circulating notes put in circulation by the maker or 
makers of such dishonored notes, pursuant to the provisions 
of this act, and adopt such measures for the payment of 
such notes, as will in his opinion most effectually prevent 
loss to the holders thereof. 

§ 5. The twenty-ninth section of said chapter two hun- 
dred and sixty of the laws of eighteen hundred anfl thirty- 
eight, is hereby amended so as to read as follows ; 
Damages 8 29. Such association or individual banker shall be 

for non-pay- 

'"''"• liable to pay the holder of every bill or note put in circu- 
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 seven per cent, per annum, from the time of such 
refusal until the payment of such evidence of debt and 
damages thereon. 
ProTiso. § 6. Nothing contained in the third, fourth, and fifth 

sections of this act, shall apply to cases where circulating 
notes registered in the comptroller's office, shall be pre- 
sented for payment to the agent of any incorporated bank, 
banking association, or individual banker, appointed ac- 
cording to the provisions of chapter two hundred and two 
of the laws of eighteen hundred and forty, entitled "An 
Act relating to the redemption of bank notes," nor to any 
bank, banking association, or individual banker, for whom 
there shall not be at the time an agent duly appointed as 
prescribed in the said act ; nor to banks, associations, or 
individual bankers, whose place of business is in either of 
the cities of New York, Albany, Brooklyn, or Troy. 



BANKING COEPORATIONS. 191 

ACT OF APRIL 16th, 1852. 

' (LAWS 1852, CHAP. 370, P. 684) 



An Act to amend Section sixteen of Chapter nine of Title 
two of Part one of the Revised Statutes. Passed April 



16, 1852. 



The People of the State of New Yorlc, represented in 
Senate and Assemhly, do enact as follows : 

% 1. Section sixteen of chapter nine of title two of part Amend- 
one of the revised statutes is hereby amended by inserting 
the words " or Banking Associations," immediately after 
the words " safe incorporated moneyed institutions." 

§ 2. This act shall take effect immediately. 



CONCURRENT RESOLUTIONS of March 4th, 

1852. 

(LAWS 1852, p. 781.) 



In Senate. 
OoNC0EEENT Eesolution. March 4, 1852. 

Whereas, a large number of bank note plates of broken 
banks', banks which have given notice of closing their busi- 
ness, and plates that are not used belonging to different 
banks are now in the bank department. 

Therefore resolved, if the Assembly concur, that the 



192 SPECIAL STATUTES APPLICABLE TO 

superintendent of tte banking department, be and he is 
hereby authorized and directed to destroy the said plates 
or cause the same to be done, and that hereafter whencTer 
any bank, banking association or individual banker shall 
fail, or any bank, banking association or individual banker 
shall give notice of an intention to discontinue the busi- 
ness of banking, it shall be the duty of the said superin- 
tendent to destroy or cause to be destroyed all plates and 
impressions belonging to such bank, banking association 
or individual banker, and it shall be the duty of the said 
superintendent to include in his annual report a statement 
of all plates so destroyed as aforesaid. 

By order of the Senate. 

IRA P. BAENES, Clerk. 



In Assembly. 
April 16, 1852. 

Resolved, That the Assembly do concur in the passage 
of the foregoing resolutions. 

By order of the Assembly, 

EICHARD TJ. SHEEMAN, OUrTc. 



BANKING CORPORATIONS. 193 

ACT OF APRIL 13th, 1853. 

(LAWS 1853, CHAP. 223, P. 428.) 



An Act to amend an aot entitled '■'■An Act concerning 
foreign icmh nutes.^'' Passed Ap-il 13, 1853. 



Amend- 



The People of the State of New York, represented in 
Senate and Assembly, do enact as follows : 

§ 1. Section two of the act entitled "An act concerning 
foreign bank notes," passed May 7, 1839, is hereby amend- ™™ ° "" 
ed so as to read as follows : It shall not be lawful for any 
incorporated banking institution within this State, or any 
association or any individual or individuals, authorized to 
carry on the business of banking by virtue of the act enti- 
tled "An Act to authorize the business of banking," di- 
rectly or indirectly, on .any pretence whatever, to procure 
or receive, or to offer to receive, from any corporation, as- 
sociation, person or persons whomsoever, any bank bill, or 
note or other evidence of debt in the similitude of a bank 
note, issued or purporting to bave been issued by any cor- 
poration, association or individual situated 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, indi- 
vidual or individuals, in the first part of this section men- 
tioned, to issue, utter or circulate as money, or in any way, 
directly or indirectly, to aid or assist in the issuing, utter- 
ing or circulating as money, within this State, of any such 
13 



194: SPECIAL STATUTES APPLICABLE TO 

bank bill, note or other evidence of debt, issued or purport- 
ing to have been issued by any corporation, association or 
individual situate or residing without this State, or to pro- 
cure 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 issuing, uttering 

eianee, 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 receiving and paying out 
such foreign bank bills as they shall receive at par in the 
ordinary course of their business ; and nothing in this sec- 
tion contained shall prohibit the said banking institutions, 
associations and individual bankers, in the first part of this 
section mentioned, nor shall they be prohibited, from re- 
ceiving foreign notes from their dealers and customers in 
the regular and usual course of theip business, at a rate of 
discount not exceeding that which 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, or from obtaining from 
the corporations, associations or individuals, by which or 
by whom such foreign notes were made, the payment or 
redemption thereof. 
Eatesofin- | 2. It shall not be lawful for any person within this 

discount. State to issue, utter or circulate as money, or in any way, 
directly or indirectly, to aid or assist in the issuing, utter- 
ing or circulating as money, within this State, of any bank 
bill, note or other evidence of debt in the similitude of a 
bank bill or note, issued or purporting to have been issued 
by any corporation, association or individual situated or re- 
siding without this State, which shall have been received 
by such person at a greater rate of discount than is or 
shall be at the time fixed by law for the redemption of the 



BANKING CORPORATIONS. 195 

bills of the banks of this State at their agencies, or to pro- 
cure or receive, in any manner whatsoever, or to offer to 
receive any such bank bill, note or evidence of debt, at a 
greater rate of discount than is or for the time shall be 
fixed by law for the redemption of the bills of the banks 
of this State at their agencies, with intent to issue, utter or 
circulate, or with intent to aid or assist in issuing, uttering 
or circulating, the same as money within this State ; but saving 
nothing in this section contained shall prohibit any person 
not authorized to carry on the business of banking within 
this State, nor shall any such person be prohibited, from re- 
ceiving foreign notes in the regular and usual course of 
business, or from obtaining from the corporations, associa- 
tions or individuals by which or by whom such foreign 
notes were made, the payment or redemption thereof. 

§ 3. The penalties provided in section four of the act 
hereby amended shall apply to any violation of this act. 

§ 4. This act shall take effect immediately. 



Penalties. 



ACT OP APRIL 15th, 1853. 

(LAWS 1863, CHAP. 250, P. 539.) 



An Act relating to Incorporated Banks, Ba/nkmg Associa- 
tions, and Individual JBanJcers, located and doing iusi- 
ness in the city of New York. Passed April 15, 1853. 



The People of the State of New York, represented in 
Senate and Assembly, do enact as follows: 

§ 1. In addition to the quarterly reports now required .^^^^^ ^^ 
by law to be made to the superintendent of the banking de- ^''"^"''"'^ 



196 SPECIAL STATUTES APPLICABLE TO 

partment, by incorporated banks, banking associations, or 
individual bankers, in this State, every incorporated bank, 
banking association or individual banker, located and doing 
business in the city of New York, shall publish or cause 
to be published on the morning of every Tuesday, in a 
newspaper printed in said city, to be designated by the su- 
perintendent, a statement, under the oath of the president 
or cashier, showing the condition of the bank, banking as- 
sociation or individual banker making such statement, on 
the morning of each day of the week next preceding the 
date of such statement, in respect to the following items 
and particulars, to wit : average amount of loans and dis- 
counts, specie, deposits and circulation. 
Foifeitare. § 2. Such statement shall be published at the expense 
of the bank, banking association or individual banker 
making the same ; and if any bank, banking association 
or individual banker shall refuse or neglect to make the 
statement required in the first section of this act for two 
successive Tuesdays, it shall forfeit its charter (if an incor- 
porated bank), and its privileges as a banking association 
or individual banker ; and every such bank, banking asso- 
ciation or individual banker may be proceeded against, and 
its affairs closed, in any manner now required by law in 
case of an insolvent bank or banking association. The 
terms "banking association" and " individual banker," as 
used in this act, shall be deemed to apply only to such 
banking associations and individual bankers as are or may 
be organized under the " Act of April 18, 1838," and the 
several amendments thereto. 

§ 3. This act shall take effect on the first day of August, 
one thousand eight hundred and fifty-three. 



BANKING CORPORATIONS. 197 

ACT OF APRIL 3d, 1854. 

(LAWS 1864, CHAP. 138, P. 321.) 

An Act for the withdrawal of the Circulating Bills of 
incorporated hamks, whose cha/rters have expired or may 
hereafter expire. Passed April 3, 1854. 



The People of the State of New York, represented in 
Senate and Asserribly, do enact as follows : 

§ 1. The circulating notes issued by any incoi-porated ^^^"1,'^'^'^^^ 
bank, whose charter has expired or shall hereafter expire, ^°"'^°^"^' 
shall be withdrawn from circulation by the trustees or legal 
representatives thereof, and returned to the superintendent 
of the bank department, to be destroyed, as follows : 

The notes of banks whose charters have already expired, 
one third part of its circulating notes in one year, one 
other third part within two years, and the remaining one- 
third part within three years, from the time this act shall 
take eflfect. 

And the circulating notes of all banks whose charters 
shall hereafter expire, as follows : 

One third part in one year, one other one-third part 
thereof in two years, and the remaining one-third in three 
years, from the time their charters shall respectively expire. 

But this section shall not prevent any person, individual Proviso, 
banker or banking association from presenting to the trust- 
ees or legal representatives of such expired incorporated 
bank such circulating notes for payment at any time. And 
nothing contained in this act shall in any manner affect or 
impair the duties, liabilities or obligations of the trustees, 



198 SPECIAL STATUTES APPLICABLE TO 

directors or stockholders of such expired incorporated 
banks, or the rights or remedies of any of the holders of 
such circulating notes, 
tobere^-""' § 2. Every banking association transformed from an 
incorporated bank, and the officers and agents of every 
such association, and the trustees and agents of all such 
expired incorporated banks, shall be prohibited from issu- 
ing, paying out, or in any way, directly or indirectly, cir- 
culating the notes of any incorporated bank whose charter 
has expired, or shall hereafter expire, after the time limited 
by the first section of this act for its withdrawal from cir- 
culation. And every such association, officer, agent or 
trustee, that shall offend against any of the provisions of 
this act, shall be liable to the penalties prescribed by law 
for issuing bills or promissory notes, for the purpose of put- 
ting them into circulation as money, without being author- 
ized by law. 
Security § 3. And iu casc of auv failure to return such circula- 

for notes not " *' 

returned. ^^^^ notcs to the Superintendent of the bank department to 
be destroyed, as provided for in the first section of this act, 
the said trustees or legal representative of such expired in- 
corporated bank shall deposit with such superintendent an 
amount in cash, which shall be equal to the circulating 
notes required to be returned as aforesaid, to be held as 
security until the said circulating notes are returned to said 
superintendent to be destroyed, except as to the last one- 
third part of said circulating notes, for which no deposit of 
money shall be required. But said last one-third part of 
said circulating notes shall be withdrawn from circulation 
and destroyed, as far as practicable, as provided for in the 
first section of this act. 

And if any trustee or legal representative of such ex- 



BANKING CORPORATIONS. 199 

pired bank shall neglect or refuse to comply with the pro- 
visions of this act, it shall be the duty of such superintend- 
ent to proceed to wind up the affairs of such expired bank 
in the same manner as if it were an insolvent corporation. 
§ 4. This act shall take effect on the first day of May 
next. 



ACT or APRIL 10th, 1854. 

(LAWS 1854, CHAP. 185, P. 442.) 



An Act directing the copies and certificates of association 
of iamks to ie transferred from the Secretary's office to 
the BamJsing Depa/rtment. Passed April 10, 1854. 



The People of the State of New Yorh, represented in 
Senate and Assembly, do enact as follows : 

§ 1. All copies of certificates of association under and 
by virtue of the general free banking law and the acts 
amendatory thereof, filed in the office of the secretary of 
state, shall be transferred to the banking department ; 
and hereafter all copies of certificates of association, 
formed pursuant to such laws, shall be filed in the office of 
the superintendent of the banking department, who shall 
furnisb, on payment of the same fees now chargeable in 
the secretary's office, all certificates in relation thereto as 
if the same had been originally filed in his office. All the 
powers conferred upon or duties required by any law of 
this State to be performed by the secretary of state, in re- 
lation to banking associations, shall hereafter be performed 
by the superintendent of the banking department. 

§ 2. This Act shall take effect immediately. 



200 SPECIAL STATUTES APPLICABLE TO 

ACT OP APRIL 15th, 1854. 

(LAWS 1854, CHAP. 242, P. 551.) 



An Act amendatory of the act entitled ^'•An Act authori- 
zing the 'business of hamMng" passed April 18, 1838, 
and the acts amending the same. Passed April 15, 
1854. 



The People of tlie State of New YorTc, represented in Sen- 
ate and Assembly, do enact as follows : 

Examining § 1. The pcrsoii designated by the superintendent of 
the bank department, under the existing laws, to examine 
the books, papers, and affairs of any bank, banking associ- 
ation or individual banker, shall take and file in the office 
of the clerk of the county where he resides, the oath of 
office prescribed in the constitution, and he shall have au- 
thority to examine on oath any individual banker, 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 any willfiil 
false swearing in any such examination shall be perjury. 
And when directed by the said superintendent, such per- 
son shall inquire whether any banker transacts the busi- 
ness of banking at the city, town, or village where the cir- 
culating notes of such individual banker purport to have 
been issued and dated ; and 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. 



BANKING CORPORATIONS. 201 

§ 2. Such person shall have power to summon, in writ- M»y™™;_ 
ing under his hand, any inhabitant of the county in which before wm*^ 
he may be conducting the inquiry to appear before Rim 
and testify in relation to the same. If the party so sum- 
moned 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 siim of one hundred 
dollars to be sued for and recovered, with costs, by the 
superintendent of the bank department, in his name of 
office, and to be paid into the treasury to defray the gene- 
ral expenses of the bank department ; and upon such ne- 
glect or refusal being duly proved by the person conduct- 
ing 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 touching the matters of 
such inquiry, he shall by warrant 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. 

§ 3. If it shall appear from such examination and unsouna 

banks and 

report that any bank, banking association, or individual ^™""s- 
banker is in an unsound or unsafe condition to do banking 
business, or that the business of banking is not transacted 
by such bank, association, or banker at the place where 
said circulating notes 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 or deliver any registered notes to such bank, 
association or banker, and to retain ' the interest on all se- 
curities held in trust for such bank, association or banker 



202 SPECIAL STATUTES APPLICABLE TO 

until such time as he shall be satisfied that such bank, as- 
sociation, or banker is in a sound and safe condition to do 
a bSnking business, and that the business of banking is 
transacted by such bank, association, or banker at the 
place where their circulating notes are dated and purport 
to be issued, 
of^eport""" § ^' Whenever the superintendent shall deem it 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. The reasonable costs and expenses of every 
such examination and publication shall be paid by the 
bank, association, or banker whose affairs are examined, 
in the manner provided in the "Act to organize a bank 
department." 
befiM''by'° § ^- '^^® sccond and third sections of chapter two hun- 
bankeS* drcd and eighty-one of the Laws of eighteen hundred and 
forty-four are hereby extended and declared to be applica- 
ble to every individual banker who is now doing business or 
shall hereafter do business under the general banking laws 
of this State, or who has received or hereafter shall receive 
circulating notes under the said laws ; and the certificate 
required by the third section of the said act shall be filed 
by every individual banker now doing business as afore- 
said, and who has not already filed the same, within sixty 
days after this act shall take effect,.and by every individual 
banker who shall hereafter desire to obtain circulating 
notes under the general banking laws of this State, previ- 
ous to the delivery of any such notes to him. In ca,se of a 
notice being filed with the superintendent of the bank 
department, of any change of residence of any individual 
banker, and of the place of doing his business, the super- 



BANKING CORPORATIONS. 203 

intendent shall publish a notice thereof in the State paper, 
and in such other newspapers as he shall direct, at the ex- 
pense of such banker. 

§ 6. When it shall appear by the return of any individ-j^i^*!™?'^^^. 
ual banker, or by the report of any person designated byJointiyHaWe. 
the superintendent of the bank department, that any per- 
son is interested with such individual banker, directly or 
indirectly, in the securities deposited by him for the pur- 
pose of obtaining circulating notes, or in the business of 
circulating such notes, or in the benefits and advantages 
thereof, the said superintendent shall withhold all interest 
and dividends on the securities deposited with him by such 
banker, and all circulating notes from him, until such 
banker shall have filed in the bank department a certifi- 
cate signed by every person so returned or reported as 
interested as aforesaid, and acknowledged by him in the 
manner prescribed by law to entitle deeds of land to be 
recorded, stating that such person is interested with such 
individual banker in the circulating notes obtained or to 
be obtained by him, and in the benefits and advantages of 
circulating the same ; which certificate shall be evidence 
in all courts and places that the person so signing and ac- 
knowledging the same is a general partner with the said 
original banker in the business of banking, and as such is 
liable with him individually for all the debts and obliga- 
tions created or made by such individual banker in the 
said business. 

§ 7. In the publication of the abstracts of the quarterly Abstracts. 
returns of individual bankers, the superintendent of the 
bank 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. 



204 SPECIAL STATUTES APPLICABLE TO 

sj^ed^''"'^ §8. The circulating notes delivered to individual bank- 
ers shall express only the individual liability of the banker 
issuing them, and shall be signed by him only, and not by 
any attorney or agent ; and any banker or "person acting 
as his attorney or agent, who shall violate any provision 
of this section, shall be liable to a penalty of one hundred 
dollars for each offence, to be recovered in the name of 
the people of this State, with costs, and to be paid into the 
treasury to defray the general expenses of the bank depart- 
ment. 

Sale of bank- R 9. It shall uot bc lawful for any individual banker, 

ing business *J tj i 

forbidden, jj^ying circulating notes obtained under the general bank- 
ing laws of this State, to sell or transfer the business of 
banking, upon the securities deposited by him, to any per- 
son or persons ; and until such, business shall be closed by 
the return of the circulating notes issued, and the delivery 
of the securities deposited, the same shall be conducted 
only in the name of the individual banker by whom the 
said securities were deposited, and he shall continue indi- 
vidually liable for the payment of all circulating notes 
delivered to him. 



BANKING CORPORATIONS. 205 

ACT OF MARCH 15th, 1855. 

(LAWS 1855, CHAP. 69, P. 101.) 



An Act to amend the act entitled " An Act to enforce the 
responsibility of the Stockholders m certain ha/nMng in- 
corporations and associations, as prescribed lyy the Con- 
stitution, and to provide for the prompt payment of 
demands against such corporations and associations,^^ 
passed April 5, 1849. Passed March 15, 1855. 



The People of the State of New YorTc, represented in 
Senate and Assembly, do enact as follows : 

§ 1. The eleventh section of the act, entitled, " An Act 
to enforce the responsibility of stockholders in certain 
banking incorporations and associations, as prescribed by 
the constitution, and to provide for the prompt payment of 
demands against such incorporations and associations," 
passed April fifth, eighteen hundred and forty-nine, shall 
be modified and amended so as to read as follows : 

Every receiver appointed according to this act, after 
giving security, shall take into his possession all the prop- 
erty, effects, books, papers, accounts and demands against 
such corporation or association ; including the securities, if 
any, which may have been deposited with the superin- 
tendent belonging to such corporation or association, 
excepting therefrom so much of the same as may be 
necessary to enable the superintendent 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 



206 SPECIAL STATUTES APPLICABLE TO 

superintendent or any justice of the supreme court shall 
direct, requiring the creditors of such corporation or asso- 
ciation to exhibit and establish their demands before him 
within thirty days from the time of his appointment. 
Such receiver sball possess all the powers of receivers of 
corporations under the third article of title four of chapter 
eight and part third of the Eevised Statutes, in respect to 
the settlement of all demands exhibited to them, and in 
all other respectSj except as herein otherwise provided; 
and all such powers now conferred by law on trustees of 
insolvent debtors as may be applicable ; and shall be sub- 
ject to all the duties and obligations by law imposed on 
receivers of corporations, except as herein modified. 
§ 2. This act shall take effect immediately. 



ACT OP MARCH 27th, 1855. 

(LAWS 1865, CHAP. 93, P. 137.) 



An Act repealing the act prohibitory of the circulation of 
the nils of ianJcs not cha/rtered hy the la/ws of this 
State, under the denormnation of five dollars. Passed 
March 27, 1855. 



The People of the State of New YorTc, represented in 
Senate and Assembly, do enact as follows : 

§ 1. The act entitled "An Act to prohibit the circula- 
tion of the bills of banks not chartered by the laws of this 
State, under the denomination of five dollars," passed 
April twentieth, eighteen hundred and thirty, is hereby 
repealed. 

§ 2. This act shall take effect immediately. 



BANKING CORPORATIONS. 207 

ACT OF APRIL Bth, 1855. 

(LAWS 1855, CHAP. 155, P. 236.) 



An Act to provide for the punishment of the fraudulent 
and unauthorized issue cmd transfer of the stock and 
ionds of corporations and joint stocJc companies. 
Passed April 5, 1855. 

The People of the State of New York, represented in 
Senate and Assembly , do enact as follows : 

§ 1. Every officer and every agent of any incorporated 
company or corporation, formed or existing under or by 
virtue of the laws of any of the United States, who shall 
within this State willfully and designedly sign or procure 
to be signed, with intent to issue, sell, or pledge, or to 
cause to be issued, sold, or pledged, or shall willfully and 
designedly issue, sell, or pledge, or cause to be issued, 
sold, or pledged, any false or fraudulent certificate, or 
other evidence of the ownership or transfer of any share 
or shares of the capital stock of such incorporated com- 
pany or corporation, or any false or fraudulent bond, or 
evidence of debt of such incorporated company or corpo- 
ration, or any certificate or other evidence of the owner- 
ship or transfer of any share or shares in such incorporated 
company or corporation, or any instrument purporting to 
be a certificate or other evidence of ownership or transfer 
of such share or shares, or purporting to be such bond or 
evidence of debt, the signing, issuing, selling, or pledging 
of which shall not be authorized by the charter and by- 
laws of such incorporated company or incorporation, or 



208 SPECIAL STATUTES APPLICABLE TO 

some amendment thereof, shall be deemed guilty of a fel- 
ony, and shall be punished by a fine not exceeding three 
thousand dollars, and imprisonment in the state prison for 
a term not less than three nor more than seven years. 

§ 2. Every officer and agent of every incorporated com- 
pany, joint stock company, or corporation, formed or exist- 
ing under or by virtue of the laws of any of the United 
States, who shall within this State, knowingly, willfully, 
and designedly sign or procure to be signed, with intent 
to issue, sell, or pledge, or cause to be issued, sold, or 
pledged, or who shall knowingly, willfully, and de- 
signedly, issue, sell, or pledge, or cause to be issued, 
sold, or pledged, any certificate or other evidence of the 
ownership or transfer of any share or shares of the capital 
stock of such incorporated company, joint stock com- 
pany, or corporation, or any bond or evidence of debt of 
such incorporated company, joint stock company, or cor- 
poration, or any instrument purporting to be a certificate, 
or other evidence of ownership or transfer of such share 
Dr shares, or purporting to be such bond or evidence of 
debt, without being thereunto first authorized and em- 
powered by such incorporated company, joint stock com- 
pany, or corporation, and every such officer and agent 
who shall reissue, sell, pledge, or dispose of, or cause to be 
reissued, sold, pledged, or disposed of, any surrendered or 
cancelled certificate, or other evidence of the ownership 
or transfer of any such share or shares, or of any right or 
interest therein, with the intent of defrauding any such cor- 
poration or any person or persons, shall be deemed guilty 
of a felony, and shall be punished by a fine not exceeding 
three thousand dollars, and imprisonment in the state 
prison not less than three nor more than seven years. 



BANKING CORPORATIONS. 208a 

ACT OF MARCH 14th, 1857. 

(LAWS 1B51, VOL I., CHAP. 103, P. 212.) 



An Act to amend the act to organize a liamik d&pa/rimient, 
passed April twelfth, eighteen hundred and fifty-one, 
and prescrihiny the powers and. duties of the superin- 
tendent. Passed Ma/rch 14, 185T. 



The People of the State of Nemo York, represented, in 
Senate and Assembly, do enact as follows : 

§ 1. Section two of the act to organize a bank depart- salary of 

Buperintend- 

ment is hereby amended by striking out, from the fifth and en*, 
sixth lines of the said act, the following words : " He shall 
receive an annual salary of twenty-fire hundred dollars," 
and inserting the words, " He shall receive an annual salary 
of five thousand dollars." 

§ 2. No transfer of stocks or mortgages now held or^^^^^^^ ^^ 
hereafter received by the superintendent of the banking mort|ag°Sf 
department, as security for circulating notes issued for the 
same by him, shall be deemed valid or of binding force or 
effect, unless the same be countersigned by the treasurer 
of the State, or in his absence from his ofB.ce, or inability 
to perform the duties of his office, by his deputy. It shall 
be the duty of the treasurer aforesaid to keep in his office^ treasurer. 
or in the office of the superintendent of the banking de- 
partment, a book, in which shall be entered the name of 
every bank, banking association, or individual banker, from 
13* 



208& SPECIAL STATUTES APPLICABLE TO 

whose account such transfer of securities is made by the 
superintendent, and the name of the party to whom such 
transfer is made, unless such transfer shall be made in 
blank, in which case the fact shall be stated in said book ; 
and the par value of any stock so transferred shall be en- 
tered therein, and the amount for which every mortgage 
transferred is held by the superintendent, and the name of 
the party to whom assigned shall also be therein entered ; 
and it shall be the duty of the treasurer, immediately upon 
countersigning and entering the same, to advise by mail 
the bank, banking association, or individual banker, from 
whose account such transfer was made, of the kind of se- 
curity and the amount of the same thus transferred. 

§ 3. The treasurer shall present, in his annual report to 

Report of ° _ r ; r 

treaeurer. i}xq legislature, the total amount of such transfers or assign- 
ments countersigned by him. % 

§ 4. It shall be the duty of the treasurer, or in his ab- 

to^cSe^sence from his office, or in case of his inability to perform 

fe^'4o?°°' the duties of his office, of his deputy, to countersign and 
enter upon the book; in the manner aforesaid^ every trans- 
fer or assignment of any securities held by the said super- 
intendent, presented for his signature ; and the treasurer 
shall have, at all times during office hours, access to the 
books of the superintendent of the banking department, for 

• the purpose of ascertaining the correctness of the transfer 

or assignment presented to him to countersign, and the su- 
perintendent shall have access to the book above-mentioned, 
kept by the treasurer, during office hours, to ascertain the 
correctness of the entries upon the same. 

§ 5. The treasurer shall, for the services required by this 

treaiurTr. "' act, rcccive the annual salary of one thousand dollars, to 
be paid in the same manner as the salary of the superin- 



BANKING CORPORATIONS. 208c 

tendent, and the same shall be charged in the general ex- 
penses of the bank department.-^ 

§ 6. This act shall take effect on the fir^t day of April 
next. 



ACT OP MARCH 28th, 1857. 

(LAWS 1857, VOL L, CHAP. 189, P. 436.) 



As Act in relation to hanks, ianhing associations, indi- 
vidual hankers, and the hamJc department. Passed 
March 28, 1857. 



■'; 



The People of the State of^ New York, represented in 
Senate and AssewMy, do enact as follows : 

% 1. "Whenever a banking association shall lawfully, by etanglf* °' 
virtue of its articles of association, or other proper authority, 
roake any change in any of the particulars required to be 
stated in the certificate of association^ the change shall not 
be of any force or validity until a certificate thereof, exe- certificates 

•/ */ ' to be record- 

cuted by the president and cashier, under the corporate "'*°*"'*' 
seal of the association, shall have been recorded and a copy 
filed, in the same manner as the certificate of association is 
by law required to be recorded and filed. 

§ 2. It shall be the duty of either the president or »?'y »/ 

«j J JT president or 

cashier of every bank and banking association, and of""*"'""' 
every individual banker, having securities deposited in the 
office of the superintendent of the banking department of 
this State, once or more during each fiscal year, and at 



208d SPECIAL STATUTES APPLICABLE TO 

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 execute to the 
superintendent a receipt, setting forth in the same the dif- 
ferent kinds and the amounts thereof, and that the same 
are in the possession and custody of the superintendent at 
Authorized *^® ^^^^ °^ ^"^^ receipt. In case of the inability of an in- 
agenta. dividual banker to make such examination, he shall make 
the same through an authorized agent, appointed by him 
in writing, whose receipt shall have the same force and 
validity as if executed by him in person. If any bank, 

J.Q CekSc Ox 

refusal. banking association, or individual banker shall refuse or 

neglect to make such examination during the fiscal year 

comptrou- aforesaid,- the comptroller, secretary of state, and the super- 

pototageXintendent of the banking department, shall appoint some 
suitable and discreet person as agent for such bank, bank- 
ing association, or individual banker, who shall have neg- 
lected or refused to make the aforesaid examination ; and 
jj such agent shall make such examination, and if the securi- 

ties so held by the superintendent shall be found to agree 
with the books of the department, 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 association, or the individual banker, or by 
an agent by him appointed ; and it shall be the duty of such 
bank, banking association, or individual banker, to pay on 
demand to such person so appointed, and making such ex- 
amination and executing a receipt as aforesaid, such com- 
pensation therefor as the superintendent shall certify to be 
just and reasonable. 

§ 3. Section nine of the act to organize a bank depart- • 



BANKING CORPORATIONS. 2086 

ment, passed April twelve, eighteen hundred and fifty-one, 
is hereby amended so as to read as follows : 

Instead of the comptroller, secretary of state, and trea- Duty of su- 
surer, it shall be the duty of the superintendent of the bank enfbanwng 

,•,.,. department. 

department to fix upon and determine a day m respect to 
which the reports of incorporated banks, banking associa- 
tions, and individual bankers, shall be made, as provided 
in chapter four hundred and nineteen of the session laws of 
one thousand eight huiidred and forty-seven ; and the said 
superintendent shall, at least once in each quarter of a 
year, fix and designate some Saturday in each preceding 
quarter in respect to which the said reports shall be made, 
and shall give notice thereof in the manner prescribed in 
the said chapter four hundred and nineteen ; and the said 
reports shall be' made to the said superintendent as directed 
in the said chapter, and all willful false swearing in respect 
to such reports shall be deemed perjury, arid subject to 
the punishments prescribed by law for that offence. In in case of 
case of neglect to make such report within fifteen days make report. 
from the mailing of the notice designating said day upon 
which such reports shall be made, it shall be the duty of 
the superintendent to cause the books, papers, and affairs 
of the bank, association, or banker so neglecting, to be 
examined as directed by the third section of the said chap- 
ter four hundred and nineteen ; and the reasonable ex- 
penses of such examination, to be certified by the said su- 
perintendent, 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 



208/ SPECIAL STATUTES APPLICABLE TO 

above mentioned, to prosecute the same in any court of 
record, and recover the sum of one hundred dollars for 
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. 

§ 4. Whenever any circulating notes of any bank, 

iarned. banking association, or individual banker shall be returned 
to the bank department for destruction and burning, it 
shall be the duty of such bank, banking association, or in;- 
dividual banker, or the trustees or officers thereof, to pro- 
cure the attendance of an agent to witness the counting, 
Agent to destruction, and burning of such circulating notes at the 

bnrning. bank department, and sign a' certificate thereof. In case 

the individual banker, or the trustees or officers of any 

bank, or banking association, returning circulating notes 

to the bank department for destruction and burning, shall 

Refusal to rcfuse or neglect to appoint or procure the attendance of 

appoint 

agent. an agent to witness the counting and burning thereof 
within ten days after the receipt of the bills at the bank 
department, it shall be the duty of the superintendent to 
select and appoint some indifferent person, who shall, as 
the agent of such bank, banking association, banker, or 
trustee, witness and certify the counting and burning 
theireof ; 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. 
Bank-note § 5- That it shall be the duty of the superintendent of 
the banking department, and he is hereby authorized and 
directed, to destroy, or cause to be destroyed, all bank-note 



BANKING C0RP0EATI0N3. 208^ 

plates in his custody, of banks, banking associations, or in- 
dividual bankers wbicb have failed or given notice of clos- 
ing of 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, whenever 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 de- 
stroyed, 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 de- 
stroyed. 

§ 6. It shall not be lawful for the superintendent of the issuing of 

^ T . 1 . . 1 . . circulating 

banking department to issue circulating notes to any m-°otes. 
dividual hereafter commencing the business of banking 
under chapter two hundred and sixty of the laws of 
eighteen hundred and thirty-eight, and the various amend- 
ments thereto, designating such individual as a bank, un- 
less as an addition to his own proper name, and the word 
" bank " is added thereto on such circulating notes ; and in 
case such individual shall have partners in the business of 
banking at the time of commencing the same, such fact 
shall be shown by the words, " and company," to be added 
to hi^ own proper name, upon every note issued to him or 
them from the banking department. 

§ Y. Section nine of chapter two hundred and fo'rty-two 
of the laws of eighteen hundred and fifty-four, shall not be^Xesfo?^ 
so construed as to prohibit an individual banker from sell- *" ^l 
Ing his business of banking, upon the securities deposited 
by him, with all the privileges thereof, to any person who, 
previous to the passage of said act of eighteen hundred and 
fifty-four, was the partner, in good faith, of such banker, 



208A SPECIAL STATUTES APPLICABLE TO 

in the business of banking aforesaid ; neither shall it be so 
construed as to prohibit an individual banter from be- 
queathing his business of banking, upon the securities de- 
posited by him, to any person or persons ; nor shall it be 
so construed as to prohibit the business from being con- 
tinued after his death by his legatee or heir at law. 

§ 8. The superintendent of the banking department is 

teeMu^!"'" hereby directed to pay into the treasury of the State the 
sum of three hundred and sixty dollars and thirteen cents, 
now standing to the credit of the City Trust and Banking 
Company, the North American Bank, and the Farmers' 
Bank of Orange County ; and the further sum of five hun- 
dred and seventy dollars and seventy-six cents, now stand- 
ing to the, credit of the Manufacturers' Bank of Ulster and 
the Farmers' Bank of Malone, to be applied to the current 
expenses of the bank department. 
Assets of § ^- '^^ superintendent of the banking department is 

offiufwo. hereby authorized to compromise, sell, or dispose of, at 
public or private sale, as he may deem most for the in- 
terest of the bank fund, all or any portion of the assets of 
the City Bank of Bufi'alo, belonging to the bank fund, and 
pay the amount realized therefrom to the treasurer ' on ac- 
count of the bank fund. ' 
AppUoa- § ^^' '^^® terms " ha/nking association" and " mdyvid- 

teras°* ual hanker" as used in this act, shall be deemed to * apply 
only to such banking associations and individual bankers 
as are or may be organized under the act of April eighteen', 
eighteen himdred and thirty-eight, and the several amend- 
ments thereto, 

§ 11. All acts or parts of acts, so far as the same are 
inconsistent with the provisions of this act, are hereby re- 
pealed. 

§ 12. This act shall take effect immediately. 



BANKING C0KP0RATI0N3. 208i 

ACT OF APRIL 13th, 1857. 

(LAWS mi, VOL. L, CHAP. SlO, P. 766.) 



As Act to provide for the final closing of incorporated 
Icmks, continuing the "business of icmking until the 
expiration of their charters. Passed April 13, 1857. 



The People of the State of New Torh,, represented in 
Senate and Assembly, do enact as follows : 

% 1. "Whenever tlie trustees or legal representatives of 

Redemption 

any incorporated bank whose charter has expired, or shall »J<'^jj.^^»'- 
hereafter expire, shall have redeemed and returned to the 
bank department, to be destroyed, ninety per cent, of its 
circulating notes outstanding at the expiration of such 
charter, they shall be entitled to deposit with the superin- 
tendent of the banking department, and the superintend- 
ent shall be authorized to receive a deposit of money equal 
to the amount of outstanding circulation at the time of 
such deposit, to be placed by him in some bank in the 
city of Albany, in good credit, and shall immediately 
thereupon give notice in the State paper, and in at least „^^^*'Jf„°' 
one newspaper in the county where such bank shall have 
been located, which notice shall be published, at least once 
a week for six months successively, that the notes of such 
bank will be redeemed by him at the bank where such 
deposit is made atpar ; and that all the outstanding circu- 
lating notes of such bank must be so presented for redemp- 
tion 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 



208/ SPECIAL STATUTES APPLICABLE TO 

cea^ to be a charge upon the funds in the hands of the 
superintendent for that purpose. At the expiration of 
such notice it shall be lawful for the superintendent to 
surrender, and the trustees or legal representatives of such 
expired bank shall be entitled to receive from the superin- 
tendent, all the money remaining in his hands after such 
redemption, except so much thereof as shall be necessary 
to pay for the publication of the notices so published. 

§ 2. All circulating notes of such banks which shall 
not have been presented for 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 in the hands of the trustees or legal 
Liabiuty of representatives ; and all liability of said trustees or legal 

trustees. . z. /,.■.. 

representatives, for or on account of any circulatmg notes 
which shall not have been presented within the time speci- 
fied by such notice, shall also cease. And said trustees 
may, after the full payment of all the circulating notes of 
such bank which shall have been presented within the 
time required by such notice, and of all other lawful claims 
and demands against such bank, divide the remaining 
property and effects of said bank among the stockholder^ 
thereof, their personal representatives or assigns, according 
to their respective shares and interest therein. 



BANKING CORPORATIONS. 208^ 

ACT OP APRIL 15th, 1857. 

(LAWS 1867, VOL. II, CHAP. 456, P. 1.) 



As Act im relation to the assessment of taxes on incor- 
porated companies. Passed April 15, 1857. 



The People of the State of New Yorle, represented in 
Senate and Assembly, do enact as follows : 

§ 1. The fourteentli section of the fourth title of the certain sec- 

/»i-r».nr( ^ions repeal- 

thirteenth chapter of the first part of the Kevised Statutes, ea. 

entitled " Kegulations concerning the assessment of taxes 
on incorporated companies, and the commutation or collec- 
tion 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 re- 
pealed. 

§ 2. The fifteenth section of the said title is hereby 
amended to read as follows : The amount of taxes assessed 
on all incorporated companies liable to taxation shall be 
set down by the board of supervisors in the fifth column 
of the corrected assessment roll, and shall form a part of 
the moneys to be collected by the collector. 

§ 3. The capital stock of every company liable to taxa- c^pitji 
tion, except such part of it ^s 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 



2081 SPECIAL STATUTES APPLICABLE TO 

are taxable upon their capital stock^under the laws of this 
State, shall be assessed at its actual value, and taxed in 
the same manner as the other personal and real estate of 
the county. 
De oait8 in § ^' '^^^ deposits in any bank for savings which are 

baXf Ac. ^^^ to depositors, and the accumulations in any life insur- 
ance 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 Vhich are now liable to taxa- 
tion under the laws of this State. 

§ 5. The twenty-first section of the said title is hereby 
amended to read as follows : 
Companies '^^® Comptroller shall furnish the attorney-general with 

?afastagto the names of all the companies and banks refusing or neg- 

pay. 

lecting 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 discovery and seques- 
tration of its property. 

§ 6. The supreme court, on the filing of such petition, 
tion°rfprop-or on the coming in of the answer thereto, may order such 
part of the property of such company or bank to be se- 
questrated as shall be deemed necessary for the purpose of 
satisfying the taxes in arrear, with the costs of prosecution ; 
and the court may also, at its discretion, enjoin such com- 
pany or bank, and the officers thereof, from aqy further 
proceedings under their charter or act of incorporation, 
and may order and direct such other proceeijings as shall 
be deemed necessary to compel the payment of such taxes 
and costs. ' 

§ 7. This act shall take effect immediately. 



BANKING CORPORATIONS. 208m 

ACT OF AFRII. 30th, 1857. 

(LAWS 1857, VOL II., CHAP. 804, P. 11i.) 



An Act to amend the Imos relatwe to ianMng, cmd to^e- 
vent the improper retention of the notes of country 
hanks. Passed April 30, 1867. 



The People of the State of New York, represented in 
/Senate and Assembly, do enact as follows : 

§ 1. It shall be optional with every incorporated bank, 
banking association, or ihdividual banker, doing the busi-''°°°*''°'*'* 
ness of banking under any statute of this State, and re- 
ceiving after this act takes effect, on deposit, in the course 
of its or his business, or otherwise, the circulating notes 
issued by any other incorporated bank, banking association, 
or individual banker engaged in the business of banking 
under any such statute, to present such notes for redemp- 
tion 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 asso- 
ciations, or individual bankers issuing them ; but every 
such incorporated bank, banking association, and individual 
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 issuiag them, for redemption and payment, in the 
manner provided by law, as often at least as once in each 
successive week, when more than the sum of ten thousand ■ 



208«, SPECIAL STATUTES APPLICABLE TO 

dollars are held by sai4 incorporated banks, banting asso- 
ciation, or individual banker. 
Notic of § ^" •'-^ either of such banks, banking associations, or 
eiecuon. |jankers holding such circulating notes, shall elect to pre- 
sent the same for redemption and payment at the counters 
of the banks, banking associations, or bankers issuing them, 
it or he shall cause a written or printed notice of such elec- 
tion, attested by the signature of the president or cashier of 
the bank, banlsing association, or bank so holding them, 
under the seal of such bank, banking association, or banker, 
that it or he will thereafter 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 issuing 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 re- 
deemed and paid in the manner required by law; and 
when such notice shall have been given, such notes so re- 
ceived by such banks, banking, associations, and bankers 
aforesaid giving such notice, shall thereafter be presented 
at such counters, and not elsewhere, for redemption and 
payment, unless a further notice of ten days shall be given 
in the manner above provided) that such notes will there- 
after be presented for redemption and payment to the law- 
ful redeeming agent aforesaid, within the times and upon 
. the terms prescribed by law ; but nothing herein contained 
shall be construed to prohibit banks, banking associations, 
and individual bankers from redeeming, presenting, hold- 
ing, pledging, or exchanging each other's circulating notes 
in the manner, within the times and upon such terms as 
they may agree upon, or may heretofore have agreed upon, 
and as shall be conformable to pre-existing laws. 



BANKING CORPORATIONS. 208o 

§ 3. Every incorporated bank, banking association, and yioiau"n.'°' 
individual banker who shall knowingly and willfully neg- 
lect or refuse to comply with the provisions of this act shall 
forfeit and pay the sum of one thousand dollars, to be sued 
for and recovered in the name of the people of the State of 
New York, in any court having competent jurisdiction. 

§ 4. This act shall take effect on the first day of June, 
one thousand eight hundred and fifty-seven. 



ACT OF APRIL 9th, 1858. 

(LAWS 1868, CHAP. 132, P. 247.) 



An Act to restrain icmks, ianking institutions, and in- 
dividual hankers from assuming the title of savings 
hanks, or receiving deposits as such. Passed April 
9, 1858. 



The People of the State of New York, represented in 
Senate and Assemhly, do enact as follows : 

§ X. It shall not be lawful for any bank, banking asso- 
ciation, or individual banker authorized to issue circulating 
notes, by the laws of this State, established in any city or 
village, where a chartered savings bank is located and 
transacting business, to advertise or put forth a sign as a 
savings bank, or in any way to solicit or receive deposits as 
a savings bank ; and any bank, banking association, or in^ 
dividual banker which shall offend against these provisions 
shall forfeit and pay for every such offence the sum of one 
hundred dollars for every day such offence shall be con- 



208p SPECIAL STATUTES APPLICABLE TO 

tinued, 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 
offence shall be committed. 

§ 2. This act shall take effect on the first day of May 
next. 



ACT OF APRIL 11th, 1859. 

(LAWS 1859, CHAP. 236, P. 503.) 



As Act m relation to the lank department. Passed April 
11, 1859. 



TIbe People of the State of New York, represented in 
Senate and Assembly, do enact as follows : 

♦Certain § !• Scctious eight and nine of chapter three hundred 

amended, and nineteen, being an act to amend the act entitled " An 
act to authorize the business of banking," passed May 
' twenty-sixth, eighteen hundred and forty-one, and chapter 

sixty-eight, being an act to amend the act entitled " An 
act to authorize the business of banking," passed May 
twenty-sixth, eighteen hundred and forty-one, which act 
was passed on the twenty-ninth of March, eighteen hundred 
and fifty-one, and chapter three hundred and seventy, 
entitled " An act to provide for the final closing of incor- 
porated banks, continuing the business of banking until 
the expiration of their charters," passed April thirteenth, 
eighteen hundred and fifty-seven, are hereby amended so 
as to read as follows : 



BANKING CORPOEATIONS. 208$' 

1. "Whenever any banking association, individual bank- intention ^o 

.oil. . . . . close bank, 

er, receiver oi a banking association, assignee or assignees &c. 
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 representatives of any in- 
corporated bank whose charter has expired, or the receiver 
of any incorporated bank which shall have been declared 
insolvent, shall have redeemed at least ninety per cent, of 
their circulating notes outstanding at the date of such no- 
tice, expiration of charter, or declaration of insolvency, 
they shall be entitled to deposit with the superintendent, 
and he is hereby authorized to receive, a deposit of money 
equal to 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. 

2. Upon the receipt of such deposit, the superintendent uponre- 
shall immediately give notice in the State paper, and at p"^''- *"■ 
least one newspaper in the county where such bank, bank- 
ing 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 notes of such 
bank, banking association, or banker, will be redeemed by 
him, at the bank where such deposit is made, at par ; and 
that all the outstanding circulating 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 redemp- 
tion and payment within the time specified in such notice 
shall cease to be a charge upon the funds in the hands of y 

the superintendent for that purpose. 
13t 



2087- SPECIAL STATUTES APPLICABLE TO 

tendrauo' 3. At the expiratloD of such notice it shall he lawful 
Ac. for the superintendent to surrender, and such bank, hank- 

ing association, banker, receiver, assignees or trustees, or 
their legal representatives, shall be entitled to receive from 
him all the money remaining in his hands after such re- 
demption, 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. 
nSes"'*""'^ 4. All circulating notes of such bank, banking associa- 
tion, or banker, which shall not have been presented for 
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, banking 
association, or banker, in the hands of such receivers, as- 
signees, 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 haVte been presented within the time afore- 
said, shall also cease. 

5.' Said trustees, receiver, assignees, bank, banking as- 
sociation, or banker, may, after the full payment of all the 
circulating notes issued by them respectively, which ■shall 
have been presented within the time required by such no- 
tice, and of all other lawful claims and demands against 
such bank, banking association, or banker, divide the re- 
maining property and effects of said bank, banking asso- 
ciation, or banker, among the stockholders thereof, their 
or his personal representatives or assigns, according to 
their respective shares and interest therein. 
Balance to 8 2. The Superintendent of the banking department is 

be paid into n r S> f 

treasury, hereby directed to pay into the treasury of the State all 



BANKING CORPORATIONS. 208s 

balances of money remaining in his hands unclaimed for 
six years from the date of such deposit, to be applied to 
the current expenses of the bank department. 

§ 3. Any legal notice that shall be served upon the Legal no- 

■ J tlce, how 

supermtendent of the bankmg department, in relation to served. / 
any mortgage of which he is the assignee, shall specify the 
name of the mortgagor and the description of the prem- 
ises, as shown by the mortgage covering them, and the 
name of the party by whom it was assigned to him ; and, 
unless such notice shall contain the provisions hereinbefore 
mentioned, a non-compliance with the terms of such notice 
on the part of the superintendent shall not invalidate or 
lessen the security conveyed by such mortgage, or in any 
manner affect his lien upon the mortgaged premises con- 
veyed under it. 

§ i. It shall be the duty of every public officer into Duty of ev- 
whose hands shall come any pounterfeit bank-note plate, oScer. 
or other device for counterfeiting bank notes, or any coun- 
terfeit oy spurious bank notes, immediately after using 
them when necessary in evidence against the parties im- 
plicated, to surrender the same to the superintendent of 
the banking department, to be destroyed under his super- 
vision ; and it shall be the duty of the superintendent to 
destroy all such plates, devices or notes thus surrendered 
to him, in the same manner as he is now authorised to do 
in the case of banks whose charters ^ave expired or have 
become insolvent, and to report the same to the legislature 
in his annual report. 



208^ SPECIAL STATUTES APPLICABLE TO 

/ 

ACT OF APRIL 13th, 1859. 

(LAWS 1869, CHAP, ini, P. 627.) 



An Act to provide fpr the reduction of the capital stocTe of 
lamMng associations. Passed April 13, 1859. 

The People of the State of New Torh, represented in 
Senate and Assembly, do enact as follows : 

Association § 1. It shall be lawful for a banking association, now 

rapua? " or hereafter to be organized, under the general banking 
laws of this State, to reduce its capital stock to an amount 
wjiich shall be equal to the value of the property and 
effects of such banking association, above and beyond all 
its debts and liabilities, and thenceforth the capital stock 
of such association shall be such reduced amount, and the 
par value of the shares thereof shall be reduced in the same 
proportion ; but in no case shall such capital stock be re- 
duced below one hundred*" thousand dollars, the amount 
now required by law for a banking association. 

§ 2. Whenever a banking association shall propose to 

superintend- j.g^^gg its Capital stock, according to the provisions of the 
first section of this act, due notice thereof shall be given to 
the superintendent of the banking department, signed by a 
majority of its board of directors and accompanied by the 
written assent to such reduction of at least two-thirds in 
amount of the shareholders of such association. It shall 

tendent to be the dutv of the said superintendent, upon the receipt 

examine as- •' _ '■ 

»»*'■ and filing of such notice, and within a reasonable time 



BANKING COSPORATIONS. 208m 

thereafter, to make, or cause to be made, an exai]4inatioii 
of its books, property, effects, and liabilities ; upon wbicb 
examination the officers thereof may be examined on oath 
as to the debts, liabilities, property, and effects thereof. 
From the result of such examination, the said superintend- ^^«^«™'°« 
ent shall determine the value, in his judgment, of such sSfofc' 
property and effects, above and 'beyond the debts and lia- 
bilities aforesaid, and certify the same in writing, and the 
amount so determined and certified shall be thereafter the 
capital stock of such banking association, and the par 
value of the shares thereof shall be proportionably re- 
duced. 

§ 3. The expense of the examination herein provided Expense to 

, , _ be pa,id by 

for by the superintendent of the bankmg department, or banker, 
caused to be made by him, shall be paid by the banking 
association for whose benefit the application shall be 
made. 

§ 4. The determination and certificate in writing to be certificate 

^ . ^ to be record- 
made by the said supermtendent, of the amount to which ed. 

the capital stock of any banking association has been 
reduced under this act, shall be recorded in the office 
of the clerk of the county in which such banking associa- 
tion shall be located, and a certified copy thereof filed in 
the bank department of the State of New York, and the 
same shall be published by the said superintendent once a Notice to 
week for six weeks successively, in the State paper, and at 
least one newspaper in the county where such association 
shall be located, at the expense of the banking association 
applying for such reduction of its capital stock. 

§ 5. Nothing in this act contained shall in any way securities 
change or lessen the liability of the stockholders of any paired. 
banking association reducing its capital stock under its 



208'y SPECIAL STATUTES APPLICABLE TO 

provisions) to the bill-holders or other creditors thereof; 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 reduction 
shall take place ; or by which the rights, remedies, or secu- 
rity of the then existing creditors shall be weakened or 
impaired. 



ACT OF APRIL 15th, 1859. 

(LAWS 1859, CHAP. 365, P. 880.) 



An 'Act to amend "An act to enforce the responsibility of 
stockholders in certain lanhing associations ^ poLssed 
April fifth, eighteen hmidred, and forty-nine. 
Passed April loth, 1859. 



The People of the State of New York, represented, in 
Senate and Assembly, do enact as follows : 

Act amend- 8 1. Section fourth of the act entitled " An act to en- 

ed. 

force the responsibility of stockholders in certain banking 
corporations and associations, as prescribed by the constitu- 
tion, and to provide for the prompt payment of demands 
against such corporations and associations," passed April 
fifth, eighteen hundred and forty-nine, is hereby amended 
so as to read as follows : 
residenceBof A book shall be provided and kept by every corpora- 

Btockholdera -"^ c j j r ^ 

bookpro^d'-tio° ^^^ associatiou described in the first section of this 
purpose. * act, in which shall be entered the names and residences of 



BANKING CORPOKATIONS. 208m) 

the stockliolders in such, corporation or associatton on the 
iirst day of January, one thousand eight hundred and iifty, 
and the names and residences of the original stockholders 
of every corporation or association organized after the day 
last mentioned, so far as the same are known to the officers 
of the bank ; the number of shares held by each stock- 
holder ; every registered transfer of stock upon the books of 
the bank after the said last-mentioned day ; the names of the 
assignor and assignee, with their residences and the number 
of shares transferred. The said book shall be at all times, kept open''* 
during the usual hours Of transacting business, open to tto"."°''*°" 
public inspection. And a refusal by any officer of such 
corporation or association to exhibit such book to any per- 
son demanding the inspection thereof, as herein provided, 
shall subject the 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 
book as aforesaid, is hereby declared to be a misdemeanor, 
and the officer so offending, upon conviction thereof, shall 
be adjudged guilty of a misdemeanor, and be punished by a 
fine not exceeding one hundred dollars for every such sub- 
sequent refusal, or by imprisonment for a term not exceed- 
ing 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 act, the said book 
shall be presumptive evidence of the truth of the contents 
thereof; but such presumption may be repelled by evi- 
dence by any party or person interested in repelling the 
same. 

§ 2. This act shall take effect immediately. 



Penalty. 



20833 SPECIAL STATUTES APPLICABLE TO 



ACT OP MARCH 27th, 1862. 



(LAWS 1862, CHAP. 62, P. 181.) 



An Act to authorize the incorporated tanks of the State to 
take and hold any stock of the United States, or of the 
State of New York. Passed March 27, 1862. 



The People of the State of New York, represented m Sen- 
ate and Assembly, do enact as follows : 

§ 1. That it shall and may be lawful for any bank in- 
corporated by any act of the legislature of the State of 
New York, or any banking association, or individual 
bankers, to take and to become the owner of any stock of 
the United States, or of the State of 'New York. 

§ 2. That so much of the several acts incorporating 
such banks, or authorizing the business of banking, and 
the acts amendatory thereof, as is inconsistent with the 
foregoing section, be, and the same is hereby, repealed. 

§ 3. This act shall take effect immediately. 



ACT OF APRIL 22d, 1862. 

(LAWS 1862, CHAP. 422, P. 156.) 



An Act to provide for the consolidation of hanking asso' 
ciations. Passed April 22, 1862. 



The People of the State of New York, represented in Sen- 
ate and Assembly, do enact as follows : 

Authority. § !• -^^7 two Or morc banking associations,yOrganized 
under the general banking laws of this State, and located 



BANKma CORPORATIONS. 20 8y 

in the same city, village, or town, are hereby, 'authorized 
to consolidate the same into a single association, to be lo- 
cated in the same place, in the manner following : 

§ 2. The directors of the said associations may enter proceed- 

Ings to con- 

into an agreement, under their respective corporate seals, soMate. 
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 duration 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 asso- 
ciations into the shares of the new association, with such 
other details and provisions as they may deem expedient, 
not inconsistent with the provisions of the act to authorize 
the business of banking, and the acts amendatory thereof. 
^Notice of the intention to consolidate said associations 
shall be given personally or by mail to each stockholder ofr 
each of said associations, at least ten days previous to 
entering into said agreement. 

§ 3. The written consent of stockholders, owning at consent ot 

I stockholders 

least two-thirds in amount of the capital stock of each of 
said associations, shall be requisite to the validity of said 
agreement. Upon the presentation to 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 
aforesaid, the said superintendent shall, within a reasonable 
time thereafter, make or cause to be made an examination 



208s SPECIAL STATUTES APPLICABLE TO 

of the books, property, effects, and liabilities of Buch asso- 
ciations ; upon which examination the officers thereof may- 
be examined on oath as to the debts, liabilities, property 
snperin- and cffccts of such associations respectively. ' From the 

tendeut of i ^ t ..,''., 

banking de- rcsult of such examination the said superintendent shall 

partment, •*■ 

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. 

Expense. § 4. The cxpcnse of the examination herein provided 
for by the superintendent of the banking department, or ' 
caused to be made by him, shall be paid by the banking 
associations for whose benefit the application shall be 
made. ^ 

Certificate § 5. The dctermiflation and certificate in writing, to be 

In writing to ^ .^ 

be recorded, made by the said 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 clerk 

of the county in which such banking association shall be 

Piled in located ; and a certified copy thereof filed in the bank 

bankdepartr 

ment. department of the State of l^ew York ; and the same 
shall be published by the said superintendent once a week 
for sixl weeks successively in the State paper, and at least 
one newspaper in the county where such association shall 
be located, at the expense of the said banking association, 
consoii- § ^- Upon the recording of the said agree'ment and 

aSon.*"'""' certificate, the said consolidated associations shall be and 
^ become a single banking association, in accordance with 

the said agreement and certificate, with the same franchise, 
rights, powers and privileges, and subject to the same du- 
ties, conditions and limitations as the several constituent 



BANKING CORPORATIONS. 208aa 

associations ; and sucli consolidated association 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 contracts, debts, obligations, 
and liabilities ; and the separate existence and operation 
of such constituent associations shall thereupon cease and 
determine. 

§ 7. No action or other proceeding pending before any ^i^^j'"! t„ 
court or tribunal, in which either of the constituent asso- S.'°^ 
ciations may be a party, shall be deemed to have abated or 
been discontinued by reason of their consolidation ; but 
the same may be prosecuted to final judgment and execu- 
tion, in the same manner as if this act had not been passed, 
or the said new association, by order of the court in which 
such proceedings may be pending, may be substituted as a 
party in place of either of the original associations, in any 
stage of such proceedings. 

§ 8. Nothing in this act contained shall in any way Liability 

not Chang- 

change or lessen the liability of the stockholders of any ea. 
banking associations consolidating their capital stock under 
its provisions to the bill-holders 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 consoli- 
dation shall take place ; or by which the rights, remedies, 
or security of the then existing creditors shall be weak- 
ened or impaired. 

§ 9. If any stockholder in either of the associations Dissent ot 

any stock- 

availing itself of the provisions of this act, who shall not'i'"'^*'^- 
have assented to such consolidation, shall, within twenty 
days after the agreement and certificate hereinbefore men- 
tioned shall be recorded in the clerk's office of the county 
in which such associations are located, object in writing to 



20855 SPECUL STATUTES APPLICABLE TO 

such consolidation, and Remand payment for his stock, 
such consolidated association shall, within three months 
from the filing of such dissent, pay to the dissenting stock- 
holder the value of his stock, as determined in the certifi- 
cate of the superintendent of the banking department 
aforesaid ; and, upon payment so made by the said asso- 
ciation, the interest of said stockholder in the property and 
effects of said association shall cease, and the said stock 
may be held and disposed of by the said association for its 
own benefit. 



ACT OP MARCH 4th, 1863. 

(LAWS 1863, CHAP. 22, P. 35.) 



An Act to amend cm act enUtled " An act to authorise 
the iusmess. of hanking" passed April eighteen, 
eighteen hwndred and thirty-eight. 
Passed March 4, 1863. 



The People of the State , of New York, represented in 
Senate amd Assembly, do enact as follows : 

§ 1. In all cases where the articles of association of any 
banking association do not prescribe as to the number of 
directors necessary to constitute a quorum, and make no 
provision for determining the same, such banking association 
may, by its direction, declare and fix the number of di- 
rectors necessary to be present to constitute a quorum for 
the transaction of business, which number shall not be less 
than five, with the same effect as if the same was pre- 
scribed in the articles of association of such banking associ- 
ation. ' 



BANKING CORPORATIONS. 208cc 

ACT OP APRIL 29th, 1863. 

(LAWS 1863, CHAP. 240, P. 435.) 



An Act in relation to the taxation of moneyed GorporaUona 
and associations. Passed April 29, 1863. 



The People of the State of New Yorh, represented m 
Senate and AssemMy, do enact as follows : 

§ 1. All banks, banking associations, and other moneyed 
corporations and associations sball be liable to taxation on 
a valuation equal to the amount of their capital stock paid 
in or secured to be paid in, and their surplus earnings (less 
ten per cent, of such surplus) in the manner now provided 
by law, deducting the value of the real estate held by any 
such corporation or association and taxable as real estate. 

; § 2. This act shall take effect immediately. 



20Sdd SPECIAL STATUTES APPLICABLE TO 

ACT OP APRIL 29th, 1863. 

(LAWS 1863, CHAP. 241, P. 436. 



An Act to amend the ianhing laws of this State. 
Passed April 29, 1863. 



The, People of the State of New York, represented in 
Senate and Assembly, do enact as follows: 

§ 1. From and after the passage of this act, the securi- 
ties hereafter to be deposited with the superintendent of 
the banking department for notes for circulation to be 
issued to any corporation or joint-stock associatiqn for 
banking purposes, or individual banker, shall be stocks of 
this State and of the United States, in the followiiig 
proportions, that is to say, not to exceed two-thirds per 
centum ii^ United States stocks, and not less than one-third 
per centum in stocks of this State; both stocks to be 
equal to or be made equal to stocks yielding interest at the 
rate of six per centum per annum ; and the securities now 
held by the bank department, so far as the same consist of 
United States stocks and stocks of this State, may be ad- 
justed on the application of any party, concerned, so as to 
be in accordance with the provisions of this section. 

§ 2. This act shall take effect immediately. 



BANKING CORPORATIONS. 208ee 

ACT OF MAY 2d, 1863. 

(LAWS 1863, CHAP. Sl2, P. 631.) 



Ak Act to amend an act entitled "An act to enforce the 
responsibility of stockholders in certain ha/iiking cor- 
porations and assooiatAons as prescribed hy the Consti- 
tution, and to provide for the prompt payment of de- 
mands against such corporations and associations" 
passed April fifth, eighteen hwndred and forty-nine. 
Passed May 2, 1863. 



The People of the State of New Yorh, represented in^ Sen- 
ate and Assemhly, do enact as follows : 

§ 1. In case any stockholder of any corporation or asso-^!^""?^^^ 
elation mentioned In the act entitled " An act to enforce deSSf '" 
the responsibility of stockholders in certain banking cor- 
porations and associations as prescribed by the Constitu- 
tion, and to provid6 for the prompt payment of demands 
against such corporations and associations," passed April 
fifth, eighteen hundred and forty-nine, against whom judg- 
ment has been or shall be recovered, pursuant to the pro- 
visions of the said act, shall not be a resident of this State 
at the time of the confirmation of the referee's report and 
appointment provided by said act, an action may be com- 
menced in the name of the receiver of such corporation or 
association, or of the assignee of such judgment, for the 
recovery of the aniount thereof, with interest, and in such 
action the order of confirmation of such report and appor- 
tionment shall be presumptive evidence of the liability of 



208^ SPECIAL STATUTES APPLICABLE TO 

such stockholder for the amount in and by such report and 
apportionment found chargeable against him, with the 
interest thereon. 
Power of § 2. Such receiver shall have power, under the order of 

receiver to 

with*sTo"k-° the supreme court of the district in which he shall reside, 
OTde?'™'''' to compromise and settle with any stockholder of such cor- 

court. 

poratibn or association, the amount of any judgment which 
has been or shall be recovered against him as such stock- 
holder -under the provisions of the act hereby amended, 
upon such terms and conditions as shall be prescribed by 
such order, and thereupon to discharge such judgment. 
No such order shall be granted, except upon ten days' no- 
tice of the application therefor to be given to the stock- 
holders and creditors who shall have appeared in the pro- 
. ceeding in which such judgment was recovered, or their 
attorneys, 
stookhoia- 8 3_ Such stockholders and creditors, or any of them, 

ersandcred- '-> 7 j j 

poseOTderr may appear before the court on the making of said motion, 
and oppose the same. Ifor shall such order be granted, 
unless it shall appear that an execution has been issued 
against the property of said judgment debtor to the sheriff 
of the county where said judgment debtor resides, or has 

de??o*be dJ^ a place of business; or, if said judgment debtor do not 

nied, 

reside in the State, or is a foreign corporation, to the sheriff 
of the county whei-e the said order for the confirmation of 
the report of said referee has been filed, and that said exe- 
cution has been returned unsatisfied in whole or in part. 
Code ap. § 4. The provisions of chapter two of title nine of part 

plied. 

two of the Code of Procedure shall be applicable to judg- 
ments against stockholders of such corporations and asso- 
ciations, and which have been or shall be recovered under 
the provisions of the act hereby amended, and the execu- 



BANKING CORPORATIONS. 208gg 

tions issued thereon, and all the provisions of law for the 
enforcement and collection of judgments in civil actions 
are hereby made applicable to such judgments and execu- 
tions. 

§ 5. Such receiver shall have power and authority, 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. 

§6. The judgments recovered pursuant to the provi- Dookeong 
sions of the act hereby amended may be docketed in any anaVT™ 

ttiereof. 

county of this State, upon filing a transcript thereof, and 
shall thereupon be a lien upon 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 judgment 
recovered in a civil action upon personal service of process, 
and may be enforced by execution against real and per- 
sonal property, in the same manner as such judgment. 

§ 7. Such receiver, upon obtaining leave by an ordra' ^juoj „ 
of a justice of the supreme court, after the return of exe- " *'°""' 
cution unsatisfied upon any judgment recovered pursuant 
to the provisions of the act hereby amended, against a 
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 stock- 
holder shall have deceased, such action may be brought 
against his personal representatives. 

§ 8. This act shall take effect immediately. 



18t 



APPENDIX 



14 



APPENDIX. 



GENEEAL BANKING LAW OF 1838, 

AB AITEEED BT S0BSEQUBNT LEGISLATION. 



Original Section 1. The comptroller is hereby required comptroi- 
to cause to be engraved and printed in the best manner to j^ea t^prtot 
guard against counterfeiting, such quantity of circulating "iroiiatmg 
notes in the similitude of bank notes, in blank of the dif- touitude of 
ferent denominations authorized to be issued by the incor-''™^'!''''"' 
porated 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 cir- 
culating notes shall be countersigned, numbered and regis- 
tered in proper books to be provided and kept for that 
purpose in the office of said comptroller, under his direc- 
tion, by such person or persons as the said superintendent 
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. \As amended iy 
§ 6, p. 132, ante. See also, § 1, p. 81, ante^ 

Original Section 2. Whenever any person or associa-* stocks of 
tion of persons formed for the purpose of banking, under be'tSl^ 
the provisions of this act, shall lawfully transfer to the'«^' 
comptroller any. portion of the public stock, issued or to be 
issued by this State, such person or association of persons, 
sball be entitled to receive from the comptroller an equal 
amount of such circulating notes of different denomina- 
tions, 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 six 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 



212 APPENDIX. 

market value. [As amended by %1, p. 113, ante, cmd § 1, 
j[)p. 170 — 171, ante. See also, § 2, p. 82, ante.'] 

(a) The provisions of the said second section [the 
amended § last above'] shall not be construed to prevent 
the stocks now held [June 3d, 1840] by the comptroller 
nnder the act hereby amended, from being hereafter trans- 
ferred and received by him at their market value in the 
same manner as though this act had not been passed. (§ 2 
of Act May li, 1840, p. 113, ante.) 
stocks of (J) The comptroller is hereby authorized to receive and 
StatS"**^ hold all stocks of the United States already deposited in his 
office, as security for the circulating notes issued, or that 
United states may be issued to any banking association or individual 
received. ° banker on the security of said stocks, in the same manner 
and with the like effect as if they were stocks of this State. 
[§ 1, of Act of March 16th, 1844,^. 142, ante.'] 
NewYork (c) The stocks which banking associations or individual 
stocks. bankers, now or hereafter to be organized under the provi- 
sions of the act " To authorize the business of banking," 
passed April 18, 1838, and the amendments thereto, shall 
hereafter deposit with the comptroller, shall be New York 
State stocks, in all cases to be or to be made to be equal to 
stock producing six per cent, per annum, or at least one 
half the amount so deposited shall be in the stocks of the 
State of New York, as before mentioned, and not exceed- 
stocksoftheing onc-half in the stocks of the United States, in all cases 
^- ^* to be or to be made to he equal to a stock producing an 
interest of six per cent", per annum ; and it shall not be 
lawful for the comptroller to take such stocks at a rate 
above their par value or above their current market value. 
[§ 1 of the Act of April 10th, 1849, pp. 170— 171, ante^, 
Counter- Origmol Section 3. Such persons or association of 
oSr^aathS persons are hereby authorized, after having executed and 
Sne^&c.as'^^g^®*^ ^^'^^ circulating notes in the manner required by 
money. 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 busi- 
ness as regulated by the laws and usages of this State. [See 
§ 3, p. 82, aMe : also. Note 30, p. 85, ante : also, § 35, 
a/nd Note 14, p. 38, ante, and § 4 and Note 51, p. 114 
ante.] 
When and Original Section 4. In case the maker or makers of 
SSStes"' any such circulating note or notes, countersigned and reg- 
testei* ^"'' istered as aforesaid, shall at any time hereafter, on lawful 



APPENDIX 213 

demand, during tlie usual hours of business, between tlie 
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 office, in the 
usual manner ; unless the president, cashier or teller of such 
bank shall offer to waive demand and notice of tlie pro- 
test, 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 de- 
manded, and the facts of the non-payment thereof; and the 
comptroller, on receiving and filing in his office such ad- 
mission or protest, together with such note or notes, 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 pj^edhiS'^ 
omit to do so for fifteen days after such notice, the comp- "y comptroi- 
troUer shall immediately thereupon (unless he shall be sat-notpaSfi? 
isfied 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 notes, to the payment pro-rata, 
of all the circulating notes put in circulation by the 
maker or makers of such dishonored notes, pursuant to 
the provisions of this act, and adopt such measures .for the 
payment of such notes as will, in his opinion, most effec- 
tually prevent loss to the holders thereof. [As amended 
by § 1, p. 124, ante, and by § 4, ^. 188 — 190, ante. /See § 
4, p. 86, ante.] 

Original Section 5. The comptroller may give to any Powers of 
person or association of persons so transferring stock jn^^^'^^y^ 

^ „., • • ^ J? il • i. ^ xj. be given to 

pursuance ot the provisions ot this act, powers ot attorney owners to 
to receive interest or dividends thereon, which such person Se on' 
or association may receive and apply to their own use ; '^'"'**™'^ 
but such powers may be revoked upon such person or as- when to 
sociation felling to redeem the circulating notes so issued, ^^ "™^«'^ 
or whenever, in the opinion of the comptroller, the prin- 
cipal of such stock shall become an insufficient securi- 
ty; and the said comptroller, 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 



214 APPENDIX. 

stbcksmay of the kinds before specified in this act, or may re-transfer 
o?re-traim. the Said stocks, or any part thereof, or the mortgages, or 
ferred. ^^^^ ^j' ^j^gj^^^ hereinafter mentioned and provided for, upon 
receiving and canceling an equal amount of such circula- 
ting notes delivered by him to such person or association, 
in such manner that the circulating notes shall always be 
secured in full either by stock or by stocks and mortgages, 
as in this act provided. [See § 5, ^. 87 — 88, ante.] 
Bills how to Original Sect/ion 6. The bills or notes so to be counter- 
be Btampe gjgj^g^^ ^^^ ^^ payment 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." [See § 6, 
p. 88, ante.'] 
Bonds and Original Section 7. Instead of transferring public 
be'tekeiTfor' stocks as aforcsaid, to secure the whole amount of such 
notesdeiivOT- biHs or notes, it shall be lawful for such person or associa- 
^^- tion of persons, in case they shall 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 r,eal estate, 
bearing at least seven per cent, interest, of this State, pay- 
How wiis able annually or semi-annually; in which case all such 
ta suohTasef biUs or notes issued by the said person or association of 
persons, shall be stamped on their face, " Secured by 
pledge of public stocks and real estate." [As amended h/ 
I 2 rfAct of April 12, 1848, p. 153, ante. See also, § 7, 
p. 88, ante.] 
Character Original Section 8. Such mortgages shall be only upon 
gf,^"^'!"®**' improved, productive, unincumbered lands within this 
TOiae of State, to an amount not exceeding two-fifths the value of 
Moertained. Said lands, independently of any buildings thereon ; and 
the comptroller shall prescribe such regulations for as- 
certaining the title and the value of such land as he may 
deem necessary ; and such mortgages shall be payable 
. within such time as the comptroller may direct. [As 
amended hy % % of Act of April 12, 1848, p. 153, ante. 
See also, § 8, p. 88, ante.] 
seouritiea {d) The securitics which banking associations or indi- 
ited'vrttr^' ■^■idual bankers hereafter to be organized under the provi- 
comptrouer. gions of the abovc recited act, passed April 18th, 1838, 
and the amendments thereto, shall deposit with the comp- 
troller as security for the redemption of circulating notes 
issued to them, by the said comptroller, shall be New 
York state stocks, in all cases to be or to be made to be 
equal to a stock producing six per cent, per annum ; and 



APPENDIX 215 

it shall not be lawful for the eomptroUer to take such 
stocks at a rate above its par value or above its current 
market value ; or the securities shall not be less than one- 
half in such stocks and one-half in bonds and mortgages 
upon improved, productive, unincumbered lands in this 
State, exclusive of any buildings thereon ; said mortgages 
bearing an interest of not less than seven per cent, per 
annum, and to an amount not exceeding two-fitths the 
value of said lands. [§ 2 of Act of April 12, 1848,^. 153, 

(e) No mortgage hereafter to be deposited as aforesaid, no one 
shall be for a greater amount than five thousand dollars ™e°d^MM 
each. [§ 3 o/" Act of April 12, 1848, p. 153, ante : /Jee exceeding 
also, § 10, p. 184, ante.'\ *^'""°- 

(f) The provisions of the second section of the act. Mortgages 
chapter three hundred and forty of the laws of eighteen ^owtoTje 
hundred and forty-eight [§ 2, p. 153, ant6\, amending the 

"Act authorizing the business of banking," shall extend 
and be applicable to banking associations and individual 
bankers organized before the passage of the said chapter 
three hundred and forty, as well as to those organized sub- 
sequently ; but no one mortgage of lands shall hereafter 
be received as security for circulating bills to an amount 

greater than five thousand dollars ; and any mortgage 
eretofore received or hereafter received for circulating 
bills, may be held by the superintendent of the banking 
department for the full nominal amount thereof notwith- 
standing a less amount of bills may have been or shall be 
delivered upon the deposit of such mortgage, and the 
whole nominal amount of such mortgage may be collected 
by any purchaser thereof in case it shall be necessary to 
sell such mortgage at its nominal amount to meet the lia- 
bilities of the banking association or banker by whom it 
was deposited ; but the same may be sold as for the amount 
of bills delivered upon its deposit when there is no defici- 
ency of other means to meet the said liabilities. [§ 10 of 
Act of April 12, 1851, p. 184, ante.'] 

{g) It shall be lawful for the president of any banking certain 
association, or any individual banker, to make or execute ^P^^i^''^^;' 
bonds and mortgages, direct to the comptroller, to secure oomptroUer. 
the payment of circulating bills or nptes issued under the 
act to authorize the business of banking ; and all such bonds 
and mortgages heretofore received by the comptroller for 
such purpose, shall be valid. [§ 9 of Act of May 14, 1840, 
p. 120, cmte.] 



216 APPENDIX. 

When Original Section 9. The comptroller may, in his dis- 

morte^es cretioii, reassign the said bonds and mortgages, or any of 
Ss^^edJ*' them, to the person or association who transferred the same, 
on receiving other approved bonds and mortgages of equal 
Proceed- amount ; and when any sum of the principal of the bonds 
prfnotaLTof and mortgages transferred to the comptroller shall be paid 
trnstfandis ^q jjim ]ie snall notify the person or association that trans- 
troiier. ferrcd the bonds and mortgages oi such payment, and 
may pay the same to such person or association on receiv- 
ing other approved bonds and mortgages of equal amount. 
[See % 9, p. 89, cmte.'] 
mratemade W Every assignment of any bond or mortgage ex- 
by oomptroi- ecutcd by the comptroller under his official seal, ip pur- 
recorded. ° suance of the provisions of the said act, or which'inay be 
otherwise authorized by law, may be recorded in the same 
manner and with the like effect as a deed regularly ac- 
knowledged or proved before any officer authorized by law 
to take the proof and acknowledgment of deeds. [§ T o/" 
Act of May 26, 1841, p. 133, ante.'] 
°t™t" to Original Section 10. The person or association of per- 
recLv^nter-sons assigning such bonds and mortgages to the comptroller 
Mrwn''^s. may receive the annual interest to accrue thereon, iinless 
default shall be made in paying the bills or notes to be 
countersigned as aforesaid, or unless in the opinion of the 
comptroller the bonds and mortgages, or stocks so pledged 
shall become an insufficient security for the payment of 
such bills or notes. [See § 10, p. 89, ante.] 
^hen Original Section 11. In case such person or association 

?itiefto be"' of pcrsons shall fail or refuse to pay such bills or notes on 
soidandhoT.^gjjjg^jj^ in the manner specified in the fourth section of 
this act, the comptroller, after the ten days' notice there- 
in mentioned, may proceed to sell, at public auction, the 
public stock so pledged or the bonds and mortgages so 
assigned, or any or either of them, and out of the proceeds 
Proceedstoof such Sale shall pay and cancel the said bills or notes, 
the''payme^t default in paying which shall have been made as afore- 
of bills. gg^j^ . Ij^j. nothing in this act contained shall be considered 
as implying any pledge on the part of the State for the 
payment o± said bills or notes beyond the proper appli- 
cation of the securities pledged to the comptroller for 
their redemption. [See § 11, p. 89, ante.] 
piedgedse- Original Section 12. The public debt and bonds and 
heid'exdu-''^ mortgages to be deposited with the comptroller by any such 
de'mptiOT of' person or association, shall be held by him exclusively for 
circiflatiDg the redemption of the bills or notes of such person or asso- 

notes. ^ ■*■ 



APPENDIX. 2 IT 

elation put in circulation as money, until the same are 
paid. [See § 12, p. 90, cmte.'] 

(*) Whenever the securities deposited for the redemp- -vv^henia- 
tion of circulating notes, shall in the opinion of the comp- terest ana 
troUer become insufficient for that purpose, he may receive may be re- 
the dividend on all stocks as well as the interest on bonds ^"'^' 
and mortgages, and shall deposit the same in some safe 
bank or banking association in the city of Albany, in his 
name, in trust for the association or banker to whom the 
same may belong. The deposit to be made on such terms 
and at such rate of interest as the comptroller may deem 
most conducive to the interest of such association oroutodT^^*' 
banker, and to be withdrawn and paid over, whenever in 
the opinion of the 'comptroller the securities of such asso- 
ciation or banker shall be sufficient to warrant it. [§ 7 of 
Act of May 14, 1840,^. 117, ante.'] 

Original Section 13. The plates, dies and materials to pj^^j^^^ ^^^ 
be procured by the comptroller, for the printing and mak- to remain in 
ing of tlie circulating notes provided for hereby, shall re-thfoomp- 
main in his custody and under his direction ; and the ex- '™''"" 
penses necessarily incurred in executing the provisions of 
this act, shall be audited and settled by the comptroller, in exSng 
and paid out of any moneys in the treasury not otherwise p"i"°'' ^"^ 
appropriated ; and for the purpose of reimbursing the 
same, the said comptroller is hereby authorized and re- 
quired to charge against and receive from such person or 
association applying for such circulating notes, such rate 
per cent, thereon as may be sufficient for that purpose, 
and as maybe just and reasonable. [See § 13, ^. 90, ante.] 

OrigvnaZ Section 14. It shall not be lawful for the coaiptjoj. 
comptroller, or other officer, to countersign bills or notes'" not to 
lor any person or association oi persons, to an amount in wiis beyond 
the aggregate exceeding the public debt, or public debtp^"^"™ 
and bonds and mortgages at their value, as provided in 
the second section of this act, deposited with the comp- penalties 
troll er by such person or association ; and any comptroller ^<«'™i|^™ 
or other officer who shall violate the provisions of this sec- vision. 
tion shall, upon conviction, be adjudged guilty of a misde- 
meanor, and shall he punished by a fine not less than five 
thousand dollars, or be imprisoned not less than five years, 
or by both such fine and imprisonment. [See § 14, p. 91, 
am,te:] (63) 

(63) By the Act of April 12, 1861, Chap. 164, § 8, it was enacted that 
the proTisions of the fourteenth section of the General Bank Act of 18S8 



218 



APPENDIX 



Mntiiated 0) It shaR be the duty of the comptroller to receive 
™^»^»y'>« mutilated circulating notes issued by him, and to deliver 
in lieu thereof other circulating notes to the same amount. 
[§ 5 of Act of May 14, 1840, ^. 115, ante.] ■ 



Banking 
corporations 
maybe 
formed. 



ASBOcia- 
tions shall 
make a cer- 
tificate. 
Contents 
thereof. 



How 
proved, re- 
corded, and 
filed. 



Oerliflcates 
may be used 
as evidence. 



Original Section 15. Any number of pessons may as- 
sociate to establish offices of discount, deposit and circula- 
tion, upon the terms and conditions and subject to the lia- 
bilities prescribed in this act ; but the aggregate amount 
of the capital stock of any such association shall not be less 
than one hundred thousand dollars. [See § 15, p. 91, amie.'] 

Original Section 16. Such persons under their hands 
and seals, shall make a certificate which shall specify : 

1. The name assumed to distinguish such association^ 
and to be used in its dealings ; 

2. The place where the operations of discount and de- 
posit of such association are to be carried on, designating 
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 ; 

5. The period at which such association shall commence 
and terminate ; which certificate shall be proved or ac- 
knowledged and recorded in the office of the clerk of the 
county where any office of such association shall be estab- 
blished, and a copy thereof filed in the office of the super- 
intendent of the banking department. [See § 16, p. 92, 
ante, as amended lyy § 1, p. 199, ante^ 

Original Section 17. The certificate required by the 
last preceding section to be recorded and filed in the offi- 
ces of the clerk of the county and superintendent of the 
banking department, as aforesaid, or copies thereof, duly 
certified by either of those officers, may be used as evi- 
dence in ail courts and places for and against any such as- 
sociation. [As amended ly § 1, p. 199, am,te.'] 



shall extend to the superintendent of the banking department and the offi- 
cers and clerks employed in that department, , See § 8, pp. 182, 183, ante. 

By § 3, p. l%Q,ante, the powers, duties, obligatipns and penalties con- 
ferred or imposed by law upon the comptroller, or to which the comptroller 
is subject in relation to banks, <&o., are so modiiied as to be transferred to 
and conferred upon the superintendent of the banking department. 



APPENDIX. 219 

Qc^ All copies of certificates of association, under and Toteflied 
ty virtue of the general free banking law and the actspartmmt*' 
amendatory thereof, filed in the office of the secretary of 
state, shall be transferred to the banking department ; and 
hereafter all copies of certificates of association, formed 
pursuant to such laws, shall be filed in the office of the 
superintendent of the banking department, who shall fur- 
nish, on payment of the same fees now chargeable in the 
secretary's office, all certificates in relation thereto, as if 
the same had been originally filed in his office. All the 
powers conferred upon, or duties required by any law of 
this State to be performed by the seci-etary of state in rela- 
tion to banking associations, shall hereafter be performed 
by the superintendent of the banking department. [§ 1 of 
Act of April 10, 1854, j>. 199, ante!] 

Original Section 18. Such association shall have Expre^ 
power to cany on the business of banking, by discounting aodauons. "*' 
bills, notes, and other evidences of debt ; by receiving 
deposits ; by buying and selling gold and silver bullion, 
foreign coins and bills of exchange, in the manner specified 
in their articles of association for the purposesauthorized by 
this act ; by loaning money on real and personal security ; 
and by exercising such incidental powers as shall be ne- 
cessary to carry on such business ; to choose one of their 
number as president of such association, and to appoint a 
cashier, and such other officers and agents as their business 
may require, and to remove such president, cashier, officers 
and agents at pleasure, and appoint others in their place. 
[See § 18, ^. 94. Ifote 39, pp. 95—97, ante.] 

{I) No association of persons shall commence the busi- ^. -^f ""jj^j^ 
ness of banking under said act until such association shall dividual 
have deposited with the comptroller the securities required ^epoBTseon- 
by law, to the amount of one hundred thousand dollars •,^|j'j^'JJ'^*j, 
and no individual banker or bankers shall commence the 
business of banking under said act, or receive circulating 
. notes under the same, until such individual banker or 
bankers shall have deposited with the comptroller the se- 
curities required by law, to the amount of fifty thousand 
dollars. _ [§ 1 of Act of May 6, 1844, p. 142, ante.] 

Original Section 19. The shares of said association shares to 
shall be deemed personal property, and shall be transfer- pj,^ "rTy" ard 
able on the books of the association in such manner as may i>"w tran'sfcr- 
be agreed on in the articles of association ; and every per- " 
son becoming a shareholder by such transfer, shall, in pro- ^^ ^^ 
portion to his shares, succeed to all the rights and liabili- shatlhoidefs. 



220 APPENDIX. 

No change ties of prior shareholders; and no change shall be made 
impair right in the articles of association by which the rights, remedies 
"'taOTi'auon 01" security of its existing creditors shall be weakened or 
"ot^^ssoived impaired. Such association shall not be dissolved by the 
eta, of share- death or insanity of any of the shareholders therein. iSee 
holders. g j9, ^. 96, ante.] 

Articles Original SecUon 20. It shall be lawful for any associ- 

may provide ation of pci'sons Organized under this act^ by their articles 
otapitaU'c. of association, to provide for an increase of their capital 
and of the number of the associates, from time to time, as 
they may think proper. [See § 20, p. 98, ante^ 
Contracts Original Section 21. Contracts made by any such as- 
how signed.' sociatioD, and all notes and bills by them issued and put 
in circulation as money, shall be signed by the president 
or vice-president and cashier thereof; and all suits, actions 
Andsnits, and proceedings brought or prosecuted by or on behalf of 
cQtedr""" such association, may be brought and prosecuted in the 
name of the president thereof; and no such suit, action, or 
proceeding shall abateby reason of the death, resignation 
or removal from office of such president, but may be con- 
tinued and prosecuted, according to such rules as the courts 
of law and equity may direct, in the name of his successor 
in office, who shall exercise the powers, enjoy the rights, 
and discharge the duties of his predecessor. \_See § 21, p. 
98, ante.l 
Actions Original Section 23. All persons having demands 

Sn^eat^tSt against any such association, may maintain actions against 
president of the president thereof; which suits or actions shall not abate 
Nottoahate hy Tcason of the death, resignation or removal from office 
by his death of gudj president, but may be continued and prosecuted 

or removal. , • -. ^ , ■ i. t • '' jii-i^ ^ i 

to judgment agamst his successor; and all judgments and 
enforcl™'"' decrccs obtained or rendered against such president for 
against joint any debt or liability of such association, shall be enforced 
only." ^ only against the j'oint property of the association, and which 

property shall be liable to be taken and sold by execution 

under any such judgment or decree. \See § 22, p. 99, 

a7ite.'] 
sharehoid- Original Section 23. 'No shareholder of any such asso- 
somUyCbie ciatiou shall be liable in his individual capacity for any 
uniessarti- contract, debt, or engagement of such association, unless 
ciaiion make the articles of association by him signed, shall have de- 
themso. glared that the shareholder shall be so liable. [See ^ 23, 

p. 99, an.te.'] (64) 

(64) See the Act of April 5th, 1849, § 1, p. 156, ante. By 'this act it is 



APPENDIX. 221 

Original Section 24. It shall be lawful for such asso- For what 
ciation to purchase, hold and convey real estate for the Im°^1 
following purposes : 3.^ ™^ 

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, by 
way of security for loans made by, or moneys due to, such 
association ; or, 

3. Such as shall be conveyed to it in satisfaction of 
debts previously contracted in the course of its dealings ; 
or, 

4. Such as it shall purchase at sales under judgments, 
decrees, or mortgages held by such association. 

The said association shall not purchase, hold or convey Prohibited 
real estate in any other case or for any other purpose ; and any'^oth/r' 
all conveyances of such real estate shall be made to theP"''P™«- 
president or such other officfir as shall be indicated for how^ oon^''"^' 
that purpose in the articles of association ; and which "^y^ 
president or officer, and his successors, from time to time 

ii» i j_i 7»'/» !• Sale free 

may sell, assign and convey the same, tree Irom any claim fromany 
thereon, against any of the shareholders, or any person "'^^^Jjj^^^^' 
claiming under them. [See § 24, cmd Note 41, p. 100, shareholders. 
amte^ 

Original Section 25. Upon the application of creditors, when chan- 
or shareholders, of any such association, whose debts or examiratb " 
shares shall amount to one thousand dollars, and stating "' "ff?''^ "f 
facts, verified by affidavit, the chancellor may, in his dis- 
cretion, order a strict examination to be made by one of 
the masters of his court, of all the affairs of such associa- 
tion, for the purpose of ascertaining the safety of its in- 
vestments, and the prudence of its management ; and the 
result of every such examination, together with the opinion be^p^ubiisS 
of the master, and of the chancellor thereon, shall be pub- 
lished, in such manner as the chancellor shall direct, who 
shall make such order, in respect to the expenses of such 
examination and publication, as he may deem proper. [See 
§ 26, jp. 101, am,te:\ 

Origvnal Section 26, re/pealed ly %^ of the Act of May 
26, 1841. [See § 26, pp. 102—104, amte: also, § 5, p. 192, 
anU.'\ (65) 

provided, that stockholders of any corporation or joint stock association for 
banhing purposes, issuing bank notes or any kind of paper credit.s to circu- 
late as money, after January 1, 1850, shall be individually responsible, equ- 
ally and ratably. (See § 1, p. 155, ante.) 

(65) But see § 3, and § i, p. 138— 139, a»<c; also, §§ 1, 2, 3, p. 146— 



222 APPENDIX. 

Original Section 27. If such association shall neglect 
to make out and transmit the statement required in the 
last preceding section (§ 26), for one month beyond the 
period when the same is required to be made, or shall vio- 
late any of the provisions of this act, such association may 
be proceeded against, and dissolved by the court of chan- 
cery, in the same manner as any moneyed corporation may 
be proceeded against and dissolved. [See § 27, p. 104, 
ante.l (66) 
If capital Original Section 28. If any portion of the original cap- 
no'divSdsit^'l of any such association shall be withdrawn for any 
to be made, purpose whatever, whilst any debts of the association re- 
main imsatisfied, no dividends or profits on the shares of 
the capital stock of the association shall thereafter be 
made, until the deficit of capital shall have been made 
good, either by subscription of the shareholders, or out of 
the subsequently accruing profits of the association ; and 
Penalty for if it shall appear that any such dividends have been made, it 
™*™? ^wi-gliall be the duty of the chancellor to make the necessary 
case. orders and decrees for closing the afiairs of the association, 

and distributing its property and eff'ects among its cred- 
itors and shareholders. [See § 28 and note 45,^. 104, 
ante.li 
Damages for Original Section 29. Such association or individual 
menr^' banker shall be liable to pay the holder of every bill or 
note put in circulation as money, the payment of which 
shall nave 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 inte- 
rest at and after the rate of seven per cent, per annum, 
from the time of such refusal until the payment of such 
evidence of debt and damages thereon. [As amended hy 
%^ of the act of April 17, 1851 {p. 190, ante) ; see, also, 
I 29; jp. 105.) 

Original Section 30. The president and cashier of 
namSof cvery association, formed pursuant to the provisions of 
to be'ki^t" ^-^i^ ^°*' si'^il) ^^ ^il times, keep a true and correct list of 
and where' the uamcs 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 loca- 

150, ante: also, §§ 1, 2, p. IVS, ante: also, § 9, p. 183, ante: and also, §§ 
1, 2, p. 196—196, ante. 

(66) See Note 46, p. 104, ante, and the statutes and sections there cited. 



APPENDIX. 223 

ted, and also, in the oflBce of the comptroller, on the first 
Mondays of January and July, in every year. [See § 30, 
p. 105, ante.] 

Original Section 31. It shall not be lawful for anythS!$iow 
association formed under the provisions of this act, to make not to be 
any of its bills or notes of a denomination less than one Se atany' 
thousand dollars, to be put in circulation as money, pay- ^I'^mo?" 
able at any other place than at the office where the busi- JJ|,°„''^°'°' 
ness of the association is carried on and conducted. [See 
§ 31 and note i7,p. 105 ante; also, § 1 p. 75, ante.l 

Original Section 32. The Legislature may at any time 
alter or repeal this act. [See § Sip. 106, ante.'] 

Original Section 33. Repealed l>y%& of the act of May 
14, 1840 (p. 116, ante). See § 33,^. 106, ante. 

Note. — The provisiona of statutes, passed subsequently to 1838, relating 
exclusively to individual bankers, are omitted in the above statement of 
amendments to the General Banking Law. 



224 



APPENDIX. 



REVISED STATUTES. 

CHAPTEE Xni. PAET H. TITLE IV. 
(1 R. 8. 414—418.) 



TITLE IV. 

REGULATIONS CONCEROTNG THE ASSESSMENT OP TAXES ON 
INCORPORATED COMPANIES, AND THE COMMUTATION OR 
COLLECTION THEREOF. 

Companies § 1- All moneyed or stock corporations deriving an in- 
'ti°^«'"'™'Come or profit from their capital, or otherwise, snail be" 
liable to taxation on their capital, in the manner herein- 
after prescribed. (67) 

§ 2. The president, cashier, secretary, treasurer, or 
deUTCr^L^- other proper officer, of every such incorporated company, 
mentstoas- shall, On or before the first day of July in each year, make 
and deliver to the assessors, or one of them, of the town or 
ward in which such company is liable to be taxed, accord- 
ing to the provisions of the sixth section of the second title 
of this chapter, a written statement, specifying, 

1. The real estate, if any, owned by such company, the 
towns or wards in which the same is situated, and the sums 
actually paid therefor : 

2.' The capital stock actually paid in and secured to be 
paid in, excepting therefrom the sums paid for real estate, 
and the amount of such capital stock held by the State, 
and by any incorporated literary or charitable institution : 
And, 

(eT) The Supreme Court, in December, 1842, and the Court of Errors, in 
December, 1844, in The Supervisors of Niagara v. The People (4 Hill, 20, 
and 7 Hill, 504), h^ld, that associations, formed under the General Bank- 
ing Law, are corporations within the meaning of 1 R. S. 414, § 1, and liable 
to taxation on their capital. 

The Legislature, by the act of December 4th, 184'7 (§ 4, p. 160, anie), 
enacted, that all individual bankers, as well as banking associations, shall 
be subject to taxation on the full amount of actual capital paid in, or se- 
cured to be paid in, &a. See § 4, p. 160, ante. 



APPENDIX. 225 

3. The town or ward in which the principal office or 
place of transacting the financial business of such com- 
pany, is situated ; or, if there be no such principal office, 
the town or ward in which its operations are carried on, or 
in which it is liable to be taxed, under the provisions of 
this chapter. 

§ 3. The president or other proper officer of every such ^^ to 
company, shall also deliver to the comptroller, on or before comptroller, 
the first day of July in each year, a written statement, con- 
taining the same matters required by the foregoing section, 
to be specified in the statement to be delivered to the as- 
sessors. The statements required by this and the prece- 
ding section of this title, shall be certified under the oath 
of the said president or other proper officer, to be in all 
respects just and true. 

§ 4. If the statements above required, or either of them, penalty, 
shall not be furnished by any company to the assessors and 
to the comptroller, within thirty days after the time above 
provided, the company neglecting to furnish such state- 
ments, or either of them, shall forfeit to the people of this 
State, for each statement omitted to be furnished, the sum 
of two hundred and fifty dollars : and it shall be the duty 
of the comptroller to furnish the attorney-general with an 
account of all companies that shall neglect to render such 
lists, that he may prosecute for the penalties hereby im- 
posed. 

§ 5. If any company, that shall be prosecuted for any g^^ t^^j^. 
such penalty, shall pay the costs of prosecution and furnish for. 
the statement required, the comptroller, if he shall be sat- 
isfied that the omission was not willful, may, in his discre- 
tion, discontinue such suit. 

§ 6. The assessors shall enter all incorporated compa- compnnies 
nies from vvhich such statements sha]! have been received ^"^ assessed 
by them, and the property of such companies, and the 
property of all other incorporated companies, liable to tax- 
ation in their respective towns, in their assessment rolls, in 
the following manner : 

1 . They shall insert in the first column of their assess- 
pient rolls the name of each incorporated company in their 
respective towns or wards liable to taxation on its capital 
or otherwise ; and under its name they shall specify the 
amount of its capital stock paid in, and secured to be paid 
in, the amoimt paid by such company for real estate then 
belonging to such company, wherever the same may be 
situated, the amount of all surplus profits or reserved funds, 

15 



226 APPENDIX. 

exceeding ten per cent, of their capital, after deducting 
therefrom the said amount of said real estate, and the 
amount of its stock, if any, belonging to the State and 
to incorporated literary and charitable institutions. {As 
amended hy Chap. 654, Laws 1853, p. 1240.) 

2. In the second column, they shall enter the quantity 
of real estate owned by such company, and situated, within 
their town or ward ; and in the third column, the actual 
value thereof, estimated as in other cases. 

3. In the fourth column, they shall enter the amount 
of the capital stock of every incorporated company paid 
in, and secured to be paid in, and of all such surplus pro- 
fits or reserved funds as aforesaid, after deducting the sums 
paid out for all the real estate of such company, wherever 
the same may be situated and then belonging to it, and 
the amount of stock, if any, belonging to the people of this 
State and to incorporated literary and charitable institu- 
tions. {As amended iy Chap. 654, Zaws 1853, p. 1240".) 

§ Y. The assessors shall insert in the cohjurmh mentioned 
in the preceding section., the cash value of the stock of all 
Tnanufacturing and turnpike corporations {to be ascer- 
tained iy the assessor:, iy the sales of the stock, or in any 
other manner), deducting therefrom the items mmtioned in 
the preceding section ; which value, thus ascertained, to- 
gether with the value of the real estate of sitch corporations, 
shall constitute the amount on which the tax of such corpo- 
rations shall he levied. {Repealed Laws 1853, Chap. 654.) 
Preceding § 8. The provisions of the fifteenth section of the se- 
cond title of this chapter, shall be, and are hereby ex- 
tended to the incorporated companies in the two preceding 
sections named ; and the president, secretary, or other pro- 
per officer, may make the afiidavit required by said sec- 
tion. (68) _ 

§ 9. If the president or other proper officer of any in- 
corporated company named in the assessment roll shall 
show to the satisfaction of the board of supervisors, at their 
annual meeting, within two days from the commencement 

(68) § 15. If any person, whose real or personal estate is liable to taxation, 
shall at any time before the assessors shall have completed their assessments, 
make affidavit that the value of his real estate does not exceed a certain 
sum, to be specified in such affidavit ; or that the value of the personal es- 
tate owned by him, after deducting his just debts, and his property invest- 
ed in the stock of incorporated companies, liable under this chapter to tax- 
ation on their capital, does not exceed a certain sum to be specified in the 
affidavit, it shall be the duty of the assessors to value such real or personal 
estate, or both as the case may be, at the sums specified in such affidavit, 
and no more. (1 R. S. 392, § 15.) 



section ex- 
tended. 



APPENDIX. 227 

thereof, by the affidavit of such officer, to be filed with the 
clerk of the board, that such company has not been, dur- 
ing the preceding year, in the receipt of net annual profits 
or clear income equal to five per cent, on the capital stock 
of any such company paid in, or secured to be paid in, 
after deducting from the amount of their capital stock the entitiedto^ 
assessed value of their real estate, such company shall be ™^"'^'°' 
entitled to commute for their taxes on such capital stock 
by paying directly to the treasurer of the county in which 
the business of such company is transacted, a sum equal to 
five per cent, on such net annual profits or clear income, 
and also such further sura as shall have been assessed on 
such roll, as the taxes on their real estate. And the as- 
sessment of every moneyed or stock corporation, author- 
ized to make dividends on its capital, from which no such 
affidavit shall be received as aforesaid, shall be conclusive 
evidence that such corporation was liable to taxation, and 
was duly assessed. {As amended by. CJiaf. 654, Laws 
1853, p. 1240.) 

§ 10. The capital stock of every. company liable to tax- whatpiop- 
ation, except such part of it as shall have been exempted ^J'^p"^^'^"^^. 
in the assessments under the previous sections of this title, we to taxa- 
together with its surplus profits or reserved funds exceed- '™' 
ing ten per cent, of its capital, after deducting the assessed 
value of its real estate, and also the real estate of every 
such company, shall be assessed and taxed in the same 
manner as the other personal and real estate of the county, 
unless such company shall be entitled to commute, as by 
the provisions of the preceding section, and shall elect so 
to do. {As amended by Chap. 654, Laws 1853, p. 1240.) 

§ 11. All companies employed wholly or principally commuta- 
in manufaoturing^ and all marine insurance companies^^"^- 
whose net annual income shall not exceed five per cent, on 
the capital stock paid in, and secured to be paid in, shall 
be entitled to commute for their taxes, by paying directly 
to the treasurer of the county in which the business of the 
company is transacted, five per cent, upon all such net in- 
come made by such company during the preceding year. 

§ 12. AU turnpike, bridge, or canal compames, whose 
net annual income shall not exceed five per cent, on the 
capital stock paid in, and secured to be paid in, shall be 
exempted from taxation. 

§ 13. To entitle a/ny such company to the exemption Requisites 
aforesaid, the president and secreta/ry, or some two officers tionf"^" 
of the company, shall make affida/vit, stating the capital 
stock paid in, cmd secured to be paid in, together with the 



228 APPENDIX. 

inooine and profits, and the total expenditv/res, during tTie 
preceding year, of such company / which afpda/oit shaU he 
delivered to the assessors of the town, at the time of making 
their assessments. {Last three sections repealed ly Chap. 
654. Laws 1853.) 

§ 14. The president, or other proper officer of each 
company electing to commute, shall make affidavit before 
some officer authorized to take affidavits, stating the 
amount of such net income ; and on filing the same with 
the clerk of the board of supervisors, at their annual meet- 
ing, within two days from the commencement thereof, ac- 
companied by the receipt of the county treasurer, acknow- 
ledging the payment of the proper commutation, such 
board of supervisors shall impose no tax on the property 
of such company. 
Taxes to be § 15. The amouut of taxes assessed on all incoi-porated 

collected* Companies liable to taxation, and not electing to commute, 

shall be set down by the board of supervisors, in the fifth 

column of the corrected assessment roll, and shall form a 

part of the moneys to be collected by the collector. 

Duty of § 16. The board of supervisors having completed the 

supervisors, assessment, shall transmit to the comptroller, with the ag- 
gregate valuations of the real and personal estate in their 
county, a statement, showing the names of the several in- 
corporated companies liable to taxation in such county ; 
the amount of the capital stock paid in, and secured to be 
paid in, by each ; the amount of real and personal proper- 
-ty of each, as put down by the assessors, or by them ; and 
the amount of taxes assessed on each. In those counties 
in which there is no such company, the boards of supervi- 
sors shall certify such fact to the comptroller, with their 
returns of the aggregate valuations of real and personal 
estate. 
Duty of § 17. The collector shall demand payment of all taxes 

collector, assesscd on incorporated companies, from the president, or 
other proper officer, of such companies, and if not paid, 
shall proceed in the collection and payment thereof, in 
the same manner as in other cases, and shall be liable to 
the same penalties for the non-payment of moneys collect- 
ed by him. And the collector's receipt shall be evidence 
of the payment of such tax. 
Taxes how § 1^- ^uch taxcs shall be paid out of the funds of the 

p=w. company, and shall be ratably deducted from the divi- 

dends of those stockholders whose stock was taxed, or 
shall be charged upon such stock, if no dividends be after- 
wards declared. 



APPENDIX. 229 

§ 19. If the collector shall not be able to collect any Prooeed- 
tax assessed upon an incorporated company, he shall re-|,°f„j,t*be'"'* 
turn the same to the county treasurer, and at the sameooifeoted. 
time, make affidavit before the county treasurer, or some 
other officer authorized to administer oaths, that he had 
demanded payment thereof from the president, or other 
proper officer of the company, and that such officer had 
refused to pay the same, or that he had not been able to 
make such demand, as the case may be ; and that such 
company had no personal property, from which he could 
levy such tax. 

§ 20. The county treasurer shall thereupon certify such ii,_ 
facts to the comptroller, who shall pass to the credit of 
such county treasurer the amount of all taxes so returned 
and certified, as in the cases of taxes on the lands of non- 
residents. 

§ 21. The comptroller shall furnish the attorney-general Attomey- 
with the names of all companies refusing or neglecting to f^u^g^anj" 
pay the taxes imposed on them, with the amount due from oery- 
them respectively ; and the attorney-general shall there- 
upon file a bill in the court of chancery, against every such 
company, for the discovery and sec[uestration of its prop- 
erty. 

§ 22. The chancellor, on the filing of such bill, or on Powers of 
the coming in of the answer thereto, shall order such part "•'""oe"™- 
of the property of such company to be sequestered, as he 
shall deem necessary for the purpose of satisfying the taxes 
in arrear, with the costs of prosecution ; and he may also, 
at his discretion, enjoin such company, and the officers 
thereof, from any further proceedings under tlieir act of 
incorporation, and may order and direct such other pro- 
ceedings as he shall deem necessary, to compel the pay- 
ment of such tax and costs. 

§ 23. The attorney-general may also recover such tax, panther 
with costs, from such delinquent company, by action in remedy, 
any court of record in this State. 



230 APPENDIX. 



ACT OF APRIL 26th, 1832. 

(LAWS 1832, CHAP. 295, P. 509.) 



An Act to prevent the abatement of sidts hj or against cor- 
porations, in certain cases. Passed April 26, 1832. 

lotTonofa''' § -'•■ ^^^^ dissolution of a corporation by a decree of the 
corporation court of chancerj, or by the expiration of its charter, or 
suit. ' ° " otherwise, shall not abate any suit or proceedings in favor 
of such corporation, which shall have been pending at the 
time of such dissolution ; but 'all such suits or proceedings 
may be continued by the receivers who shall have been 
appointed for such corporation by the court of chancery, 
or by the trustees on whom the estate and effects of such 
corporation shall have devolved, in the name of such cor- 
poration, or in the names of such receivers or trustees, who 
may be substituted as plaintiffs under the direction of the 
court in which the suit shall be pending, and subject to 
such order as the court may deem expedient, in relation to 
the payment or security of costs. 
Hew euita § 2. Whenever a receiver of the property or effects of 
Sought a corporation has been appointed before its dissolution or 
afterwards, new suits may be brought and carried on by 
any such receivers, either in their own names or in the 
names of the corporation for which they shall have been 
appointed ; biit no new suit shall be brought in the name 
of a corporation after it shall have been dissolved, or after 
the expiration of its charter. 
To be ecu- § 3. No suit Commenced, in the name of any sucb re- 
tinued. ceiver, shall be abated by his removal or death ; but the 
same may be continued in the name of his successor, or of 
the corporation, if its charter has not expired or been dis- 
solved, as may be directed by the court in which the suit 
shall be pending. 
Power of § 4. The court in which any suit or proceeding against 
the court. ^ corporation which shall have been dissolved by the de- 
cree of the court of chancery, or by the expiration of its 
charter, or otherwise, shall be pending at the time of such 
dissolution, shall have power, on the application of either 
party thereto, to make an order for the continuance of such 



APPENDIX. 231 

suit or proceeding, and the same may thereafter be contin- 
ued until a final judgment or decree shall be had therein, 
whidh shall have the like effect upon the rights of the par- 
ties, as if such corporation had not been dissolved. 



ACT OF MAY 13th, 1845. 

(LAWS 1845, CHAP. 195, P. 224.) 



AiT Act m relation to stocks in moneyed corporations held 
hy the State or 'by literary or charitable institutions. 
Passed May 13, 1845. 



The People of the State of New Ywk, represented in 
Senate and Assembly, do enact as follows : 

§ 1. Any moneyed or stock corporation deriving profit j^^^'^^^Ji' 
or income from its capital or otherwise, shall add to the 
dividend which shall be declared upon any stock owned 
by the State or by any literary or charitable society or in- 
stitution, a sum equal to the assessment for taxes paid 
upon an equal amount of the stock of such corporation not 
exempt from taxation. 

§ 2. The provisions of the sixth subdivision of the Benefit of 
fourth section of the first title of chapter thirteen of thefro^tai™ 
first part of the Eevised Statutes, whereby all stocks owned "™" 
by the State or by literary or charitable institutions, in 
moneyed or stock corporations, are exempted from taxa- 
tion, are hereby declared to be for the benefit of the State 
or the institutions owning such stocks, and not for the ben- 
efit of the said corporations. ( 69 ) 



(69) 'By subdivision 6 of § 4, 1 R. S., 288, "all stocks owned by the 
State, or by literary or charitable institutions " are exempted from taxation. 
See, also, subdivision 2 of § 2, p. 224, ante. 



232 



APPENDIX. 



ACT OP MARCH 19th, 1852, 

(LAWS 1852, CHAP. 71, P. 67.) 



Ah Act to facilitate the collection of debts against corpora- 
tions. Passed March 19, 1852. 



The People of the State of New Yorh represented in 
Senate and Assemhly, do enact as follows : 

and tottis of ^ ^' "^^^ receiver heretofore appointed by any court in 
receivers? " this State, by virtue of section thirty-six, chapter eight, 
title four, article two, part three, of the revised statutes of 
this State, shall have and possess all the power and author- 
ity, and be subject to the same obligations and duties, as 
are provided in article third, title fourth, chapter eight, 
part third of the revised statutes of this State, in relation 
to receivers appointed in case of the voluntary dissolution 
of a corporation. ( 70 ) 
Eeceivers § 2. In case the corporation, in regard to which a re- 
aa-Hnent°on ceiver has been or shall hereafter be appointed, is or shall 
notS.'"" ^^ ^ imjbtual inswramice compamy such receiver shall have 
full power under the authority and sanction of the court 
appointing him, to make all such assessments on the pre- 
mium notes belonging to such corporation, as may be 
necessary to pay the debts of such corporation, as by the 
charter thereof the directors of such corporation have au- 
asSsm^nf thority to make ; and the notice of such assessment may be 
to be given, giyen in the same manner as is provided in the charter of 
said company for the directors of said coinpany to give ; 
and the said receiver shall have the like rights and reme- 
dies, upon and in consequence of the non-payment of such 
assessments, as are given to the corporation or the direct- 
ors thereof by the charter of such corporation. 
Biirrenaer § 3. Such receiver is authorized to receive a voluntary 
po es. gyj,j,Qjj(jgj. of 2X\ policies issued by such corporation, or to 

(70) See § 36, chap. 8, title 4, article 2, part three of the Revised Stat- 
utes, p. BV, ante; also article 3, title i, chap. 8, part 3, of the Revised Stat- 
utes, pp. 64-74, ante. 



APPENDIX. 233 

cancel tlie policies issued by such corporation, in all cases 
where, by the charter of such corporation, the directors 
thereof are authorized to receive the surrender of, or can- 
cel the policies issued by such corporation. 

§ 4. The court by which any such receiver may have ^^^i^^^ 
been or shall be appointed, is authorized upon a proper to examine 
action instituted for that purpose by such receiver, to ex- ratio^ *""'"' 
amine by a reference or otherwise, as it may deem proper, 
into the proceedings and acts of such corporation ; and if 
it shall appear upon'such examination that the directors 
or ofl&cers of such corporation, or either or any of them, 
have in any manner misapplied, or improperly disposed of 
the funds, property or effects of such corporation, it shall 
be lawful for such court to decree that such directors or 
officers of such corporation, as shall have been guilty of 
such misapplication or improper disposition of such funds, 
property or effects, to pay the same to such receiver, and 
to enforce such decree, by such process as may be neces- 
sary to accomplish that object. 

§ 5. This act shall take effect immediately. 



RESTRAINING ACT OP 1782. 

(1 GEEENLEAP'S ED. LAWS, P. 50.) 



Air Act to prevent the establishment of cmy lank within 
this State other than the Bank of Noeth Ameeica, and 
for incorporatim-g the same within this State, passed 
April llth, 1782. 



I. Be it, therefore, enacted ly the people of the State of 
New Yorh, represented in Senate and Assernbly, and it zs 
hereby enacted by the authority of the same, That the said 
bank mentioned in the said ordinance shall be, and is 
hereby, incorporated and made a body politic within this 
State, by the name and style of The President, Directors, 
and Company of the Bank of Noeth Ameeioa, with all and 
singular the powers, privileges, and immunities in the said 
ordinance specified ; and that no other bank, public or pri- 
vate, shall be established within this State during thepres- 



234: APPENDIX. 

ent war with Great Britadn, on pain of the forfeitTare of 
one hundred pounds for every offenee, by every person 
concerned in such bank or banks, being thereof convicted 
in the Supreme Court of judicature of this State ; which 
forfeiture shall go one-half to the complainant, and the 
other half to the treasury of this State. [Two other sec- 
tions follow this — and the act recites the ordinance of the 
Continental Congress of May 26, 1781.] 



RESTRAINING ACT OP 1804. 

(3 WEB. ED. LAWS, P. 616.) 



An Act to restradn wnincorjporated BamMng Associations. 
Passed April 11th, 1804. 



I. JBe it enacted by the people of the State of New York, 
represented in Senate and Assemhly, That from and after 
the passing of this act, no person unauthorized by law shall 
subscribe to or become a member of any association, insti- 
tution or company, or proprietor of any bank or fund for 
the purpose of issuing notes,, receiving deposits, making 
discounts or transacting any other business which incorpo- 
rated banks may or do transact by virtue of their respect- 
ive acts of incorporation ; and if any person unauthorized 
by law as aforesaid, shall hereafter subscribe or become a 
member or proprietor as aforesaid, he shall forfeit and pay 
for every such offence the sum of one thousand dollars, to 
be recovered by any person who shall sue for the same, in 
an action of debt, one-half thereof to his own use, and the 
other half to the use of the people of this State ; and all 
notes and securities for the payment of money, or the de^ 
livery of property, made or given to any such association, 
institution, or company, not authorized as aforesaid, shall 
be null and void: Provided, nevertheless, that nothing 
herein contained shall be held in any way to extend to the 
association in the city of Albany, known by the name of 
the Mercantile Cow/pa/ny, nor the association in the city of 
New York, known by the name of the Merchant^ Ba/iik, 
until the first Tuesday in May, one thousand eight hundred' 
and five. 



APPENDIX: 235 

II. And 5e it further enacted. That all unincorporated 
associations, institutions, or proprieties, formed for any of 
the purposes aforesaid, that now exist in this State, shall 
after the first Tuesday in May, one thousand eight hundred 
and five, cease to issue notes and to loan money ; and any 
person concerned or interested in the issuing such notes, or 
loaning any such money as aforesaid, after the first Tues- 
day of May, one thousand eight hundred and five, shall 
forfeit and pay, for every such offence, the sum of one 
thousand dollars, to be recovered and disposed of in the 
manner prescribed in the first section of this act. 



EXPLANATORY ACT, APRIL, 1804. 

(3 "WEB. ED. LAWS, P, 611, § 9.) 



Whereas, the Chamber of Commerce of the city of l^ew 
York have, by their respectful memorial to the Legislature, 
expressed apprehension that the bill passed both houses of 
the Legislature at the present session, entitled " An Act to 
restrain unincorporated banking associations," may be so 
construed as to subject individuals to inconvenient restric- 
tions in their usual , commercial business and pursuits ; 
Therefore, for the removal of those apprehensions, 

IX. Be it enacted and declared, That nothing in the 
^aid bill contained shall be deemed or construed to prevent 
any person, association or company from transacting or 
pursuing any business other than such as companies or 
banks, incorporated for the express purpose of banking, 
usually do or transact, nor shall any thing in the said act 
contained be deerhed or construed in any manner or way 
to affect the incorporation in the city of New York, created 
bjf virtue of an act entitled " An Act for swpplying the 
city of NewYcyrk withpwre aaid wholesome water.'" 



236 APPENDIX. 

RESTRAINING ACT OF 1813. 

(2 REVISED LAWS 1813, P. 234.) 



An Act to prevent the passing and reoei/oing of Bcmk 
Notes less them the nominal value of one doUar, and to 
restrain TTnincorporated Banking Associations. Passed 
April 6, 1813. 



I. JSe it enacted by the People of the State of New 
YorTc, represented in Senate and Assembly, That no person 
or persons whomsoever, within this State, shall give or 
receive in payment of any debt or demand whatsoever, or 
in any way attempt or offer to circulate, any bank bill or 
promissory note of any banking company within this State 
or elsewhere, for the payment of money, which shall be 
for less than the nominal value of one dollar, and any per- 
son offending against this act, either as giver, receiver or 
circulator of such bank bill or promissory note, shall for- 
feit and pay the nominal amount or value of such bank 
bill or promissory note so given or received, or attempted 
or offered to be circulated, to lie recovered vdth costs of 
suit in any court within this State having Cognizance 
thereof, by action of debt, by any person who will sue for 
the same, to his or her own use. Provided, that such suit 
or action be brought or commenced at any time within 
thirty days after the offence be done and committed. 

II. And be it fwrther enacted, that no person, unau- 
thorized by law, shall subscribe to or become a member of 
any association, institution, or company, or proprietor of 
any bank or fund, for the purpose of issuing notes, receiving 
deposits, making discounts, or transacting any other busi- 
ness which incorporated banks may or do transact, by vir- 
tue of their respective acts of incorporation : and, if any 
person, unauthorized by law as aforesaid, shall hereafter 
subscribe or become a member or proprietor as aforesaid, 
he shall forfeit and pay for every such offence the sum of 
one thousand dollars, to be recovered by any person who 



APPENDIX. 237 

shall sue for the same, in an action of debt, one-half there- 
of to his own use, and the other to the use of the people 
of this State ; and all notes and securities for the payment 
of money or the delivery of property, made or given to 
any such association, institution or company, not authorized 
as aforesaid, shall be null and void. 



ACT OP 1816. 

(LA"WS 1816, P. 12.; 



An Act concerning Banks. Passed November 12, 1816. 

♦ 

Be it enacted, a/nd declared hy the People of the /State 
of New YorJc represented in Senate and AsserrMy, That no 
Banking Company shall issue, or cause to be issued, any 
bills or notes, other than for the payment of money ; and 
that the sums which may be expressed in any bills or notes 
which any bants shall issue, or cause to be issued, which 
are according to the terms thereof receivable only in pay- 
ment of debts due to the bank, shall be recoverable by the 
bearer of such bills or notes, in like manner as if the same 
contained an express promise for the payment of money. 



RESTRAINING ACT OP 1818. 

(LAWS 1818, P. 2i2.) 



An Act relative to ianhs and for other purposes. Passed 
April 21, 1818. 



1. Be it enaotedly the people of the State of New YorTe, 
represented in Senate and Assenwly, That it shall not be 
lawful for any person, association of persons, or body corpo- 



238 APPENDIX. 

rate', from and after the first day of August next, to keep 
any office of deposit for the purpose of discounting promis- 
sory notes, or for carrying on any kind of banking business 
or operations, which incorporated banks are authorized by 
law to carry on,, or issue any bills or promissory notes, as 
private bankers, unless thereunto specially authorized by 
law : Provided, that nothing in this act contained shall be 
deemed to extend to the bank in ISTew York owned by 
Jacob Barker, called the Exchange Bank, until three years 
after the passing of this act : Provided also, that nothing 
in this act contained shall be deemed or construed to 
abridge, enlarge, or in any way affect any rights heretofore 
granted by law to any incorporated company. 

II. And le it further enacted, That in case any person 
or persons, or body corporate, sh^U contravene the fore- 
going provisions, every such person or persons, and the 
members of every such corporation, who shall either di- 
rectly or indirectly assent thereto, shall for every ofience 
forfeit the siim of one thousand dollars, to be sued for by 
the Attorney-General, and recovered in an action of debt, 
in the name of the people of this State, in any court of 
record, with costs to be taxed, and that one-half of the said 
forfeiture, when recovered, shall be to the use of the said 
people, and the other half to the informer. 

III. And be it fwrtJier enacted. That in case any incor- 
porated bank shall refuse to pay any of its bills or notes 
hereafter to be issued, in lawful money of the United 
States, on demand, the holder of such bills or notes shall 
be entitled to recover the amount thereof, in an action on 
the case, for money lent, with interest thereon, at the rate 
of ten per cent, per annum, from the time of such refusal, 
with costs. 

IV. Andle it fwrth&r enacted. That the second section 
of the act, entitled, " An act to amend the act entitled 
'An Act to incorporate the stockholders of the Bank of 
Orange, passed 6th April, 1813, and for other purposes,' " 
passed April 15, 1817, be, and the same is hereby re- 
pealed. (71) 



(71.) The second section in the act of April 15, 181V, is in these words: 
II. And he it further enacted. That the President, Directors and Company of 
each of the incorporated banks in the State of New York, shall hereafter be 



APPENDIX. 239 

ACT OP 1824. 

(LAWS 1824, P. 303.) 



» » 



An Act to prevent the Passing and Seoeiving of Bank 
Notes, payable otherwise tha/n in lawful money of the 
United States. Passed April 12, 1824. 

Whereas it hath of late become a practice with certain 
institutions, to issue bills, or notes payable in bills, notes or 
drafts, or otherwise than in money, whereby many unsus- 
pecting persons are liable to be deceived and defrauded, — ■ 
wherefore, for the prevention of such practice hereafter. 

Be it enacted hy the People of the State of New York, 
represented in Senate and Assembly That no person or per- 
sons whomsoever, within this State, shall, after the first 
day of May next, give or receive in payment of any debt 
or demand whatsoever, or in any way attempt or offer to 
circulate, any bank bill or bills, or promissory note or 
notes, of any banking company whatsoever, made payable, 
or purporting to be payable otherwise than in lawful 
money of the United States ; and any person or persons 
offending against this act, either as giver, receiver, or cir- 
culator of such bank bill or bills, or promissory note or 
notes, shall forfeit and pay the nominal amount or value of 
all and every such bank bill or bills, or promissory note or 
notes, so given or received, or attempted or offered to be 
circulated, to be recovered, with costs of suit, in any court 
within this State having cognizance thereof, by action of in- 
debitatus assumpsit, by any person who will sue for the same, 
to his or her own use ; in which action it shall be sufiicient 
for the plaintiff to declare generally as for money had and 
received to his or her use, pursuant to this act, and give 
the special matter and this act in evidence : Provided, that 
such suit or action be commenced within sixty days after 
the offence be done or committed. (72.) 

entitled to demand and receive an interest not exceeding seven per cent, per 
annum, on all loans and discounts made by each of them for a longer period 
than sixty days ; any thing in the acts of incorporation of any of the said 
banks to the contrary notwithstanding. — {Laws, ISIY, p. 306.) 

(72) The Legislature, in 1830, enacted as follows (Revised Statutes, vol. 1, 
p. 713. Original Sections 10 dk 11. Seep. 48; ante.) 

§ 10. Kg person shall give, pay, or receive in payment, or in any -way 



240 APPENDIX. 

REVISED STATUTES. 

CHAPTEE Yin. PAET IH. TITLE lY. 

(2 B. S. 457—460.) 



TITLE IV. 

ARTICLE FIEST. 

OF PEOCEEDIlfGS BY AST) AGAINST OOEPORATIONS IN 
COURTS OF LAW. 



§ 1. A foreign corporation created by the laws of any 
other State or country, may, upon giving security for the 
payment of the costs of suit, prosecute in the Courts of 
this State, in the same manner as corporations created 
under the laws of this State. 

§ 2. But where by the laws of this State, any act is for- 
bidden to be done by any corporation or association of in- 
dividuals, without express authority by law, and such act 
shall have been done by & foreign corporation, it shall not 
be authorized to maintain any action founded upon such 
act, or upon any liability or obligation, express or implied, 
arising out of, or made or entered into, in consideration of 
such act. 



circulate, or attempt to circulate, any 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. 

§ 11. Eveiy person offending against any provision of the last section, 
shall forfeit the nominal amount or value 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 offence shall be committed, with their consent and under their 
direction, in an action, to be commenced within sixty days after the com- 
mission of the offence. {See note 17, at foot of page 48, ante; and 2 R. S., 
IIS, § 11.) 



APPENDIX. 241 



§•3. In suits brought by a corporation created by or proof of 

" ' ■ " - - -- - .domestlcr 

poration. 



Tinder any statute, of this State, it shall not be necessary to''"°"'"'°™'^' 



prove, on the trial of the cause, the existence of such cor- 
poration, unless the defendant shall have pleaded in abate- 
ment or in bar, that the plaintiffs are not a corporation. i 

§ 4. The first process for the commencement of a suit Process 
against a corporation, shall be a summons, except in those '*""'" "'°°' 
cases where a scire facias or other process is allowed by 
law ; and such process, and all other writs and process 
against corporations, may be issued and tested on any day " 
in term, and nfey be made returnable on any day in the 
same or the next succeeding term, in the same manner as 
process issued against individuals may be issued, tested 
and returned. LSee § 27, Code of Procedure.'] 

§ 5. Writs of summons and other process for the com- Howserved. 
mencement of a suit against a corporation, may be served 
on the return day of such process, or previous thereto, on 
the presiding officer, the cashier, the secretary or the 
treasurer thereof; and if there be no such officer, or none 
can be found, such service may be made on such other offi- 
cer or member of such corporation, or in such other man- 
ner, as the court in which the suit is brought, may direct. 
[/Sse § 134, Code of Procedure.] 

§ 6. "When such process shall have been returned duly. Proceea- 
served, the appearance of the corporation shall be entered, '°^^ 
and the plaintiff shall proceed thereupon in such suit, in 
the same manner as in personal actions against natural 
persons. 

§ 7. In every such action, the plaintiff may declare on a Deoiaration. 
cause of action which arose previous to the commencement 
of the suit, although the same may have arisen after the 
teste of the process by which the action was commenced. 

§ 8. In any such action founded upon a note or other judgment 
evidence of debt, for the absolute payment of money on ^'o^'^'"*™' 
demand, or at any particular time, if it shall appear that 
the first process, together with a copy of the declaration 
was served at least twenty days before the return of such 
process, the plaintiff may file a declaration in such suit on 
such return day, or on any subsequent day in the same 
term, and may apply for judgment. 

§9. On such application, the court shall render judg- ib. defence 
ment for the plaintiff as by default, either interlocutory or '"'™^"'^- 
final, or both, as the case may require ; unless it shall satis- 
factorily appear to such court, that such corporation has 
16 



24:2 APPENDIX. 

good and substantial defence on the merits, whicli shall be 
disclosed by affidavit. 
Eofereace § 10. If sucti defence consist of ai set-off, and be of such 

"' ™"' a nature that the cause might be referred, the court shall 
immediately refer the cause to the clerk thereof, or to some 
other fit persons, to hear the proofs of the parties, and re- 
port thereon; and the proceedings, thereon shall be the 
same in all respects as in cases of reference. 
Preference | H. Evsry issue of fact joiucd in such cause, shall 

suorS."* have a preference at the court at which it shall be noticed 
for trial, to all other causes; and every ca^ made, special 
verdict rendered, bill of exceptions and demurrer to evi- 
dence taken, on such trial, and every issue of law joined 
on the pleadings in any such suit, shall have a preference 
in the argument thereof in any court where the same may 
be pending. 
Bate of g 12. When judgment shall be rendered against any 

eerScases. incorporated bank, for the amount of any bills or other 
evidences of debt, payable absolutely, the payment of 
which shall have been refused by such bank,' and no mea- 
sure of damages shall be specified in the act incorporating 
such bank, the plaintiff shall recover interest on such 
amount from the time of such refusal, at the rate of ten per 
ceut. a year, instead of the rate of interest established by 
law. 
Eedting § 13. In a'ctious by or against any corporation created 

po?aSon!""""hy or under any law of this State, it shall not be necessary 
to recite the act or acts of incorporation, or the proceed- 
ings by. which such corporation was created, or to set forth 
the substance thereof, but the same may be pleaded by 
reciting the title of such act, and the date of its passage. 
Mistake in . §14. In suits or proceedings by or agaiust any oorpora- 

poration!'"' tiou, a mistake in the naming of such corporation, shall be 
pleaded in abatement; and if not so pleaded, shall be 
deemed tohave been waived* 
Attach- § 15- Suits brought in the Supreme Court by a resident 

meiit against of this State, agaiust any corporation created by or under 

porafims!'^' the laws of any other State, government or country, for the 
recovery of any debt or damages, may be commenced by 
attachment. ( 73 ) 
Bywiiom § 16. The court, or any judge thereof in vacation, and 

iBsned, 

(is) This sectipn amended by the Act of March 16th, 1849 (Laws 1849, 
Chap. lOY, p. 142). See this act, post. 



APPENDIX. 



243 



any officer authorized to perform the duties of such Judge, 
in vacation, may, on the application of thd* plaintiff, issue 
such attachment to the sheriff of the county in which any 
property of such corporation may be, commanding him to 
attach and safely keep all the estate, real and personal, of 
such corporation. 

§ IT. Such application shall be in writing, and shall be proof to 
accompanied by tlie affidavit of the plaintiff, or one of theoWaimt 
plaintiff's, specifying the sum in which such corporation is 
indebted to him, over and above all discounts,; or specify- 
ing the amount of damages to which he shall claim to be 
entitled. 

§ 18. If such suit be for the recovery of a debt, the youoiiers 
original security, if any, shall be produced at the time of i^^^^rtaia 
making such application, and a copy thereof shall be an- 
nexed "to the affidavit: if there be no written security, then 
the original accounts shall in like manner be produced, and 
a copy thereof be annexed to the affidavit. 

§ 19. If such suit be for the recovery of any damages, -^honwit- 
the facts and circumstances to establish the grounds of such ness re- 
claim, and the amount thereof, shall be proved by the^""^^ 
affidavit of at least one disinterested witness. 

§ 20. Before such attachment shall issue, a bond shall Bond for 
be executed by or on behalf of the plaintiff', to the defend- o"'*'^- 
ants, in the penalty of two hundred and fifty dollars, with 
sureties to be approved by the officer to whom the appli- 
cation is made, conditioned to pay all costs which shall be 
awarded, against such plaintiff in such suit, which bond 
shall be filed by the officer receiving the same, in the office 
of a clerk of the court. 

§ 21. The sheriff to whom such attacliment shall be di- Powersof 
rected and delivered, shall proceed thereon in all respects "'""*^" 
in the manner prescribed by law in case of attachments 
against absent debtors, shall make and return an inventory, 
and shall keep the property seized by him, or the proceeds 
of such as shall have been sold, to answer any judgment 
which may be obtained in such suit. ( 74 ) 

§ 23. if any property so seized shall be perishable, or Proceea- 
if any part of it be claimed by any other person than suchjjfn'^^g^^''" 
corporation, or if any part of it consist of a vessel belong- 
ing to any port or place in this State, or any of the United 

, (74) This section amended by 

§ 2 of the Act of May 14th, 1840. Laws 1840, Chap. 354, p. 296. See 
this act, post: also the Act of April llth, 1842 (Laws 1842, Chap. 19Y, p 
227. See this act, post). 



244: APPENDIX. 

States, or of any foreign vessel, or of any share or interest 
in any vessel, the same proceedings shall be had in all re- 
spects, as are provided by law upon attachments against 
absent debtors, 
lb- § 23. Any bond required in any such case to be given 

by a petitioning creditor, may be given by the plaintiff in 
the suit ; and any bond reqiiired to be given to the sheriff 
serving such attachment, shall be held for the benefit of 
the plaintiff in such suit. 

in'^on^^ud - § 24. i«, case judgment he rendered for theplwmUffin 

mentfor any sucJh suit, and an execution he awarded tJiereon, the 

piamtiffi. gjig^„ijj' shall assign to the plaintiff any hond taken hy him, 
in the cov/rse of the proceedings, shall pay over to such 
plaintif the proceeds of all sales of perishahle property, or 
of any vessel, or sha/re or interest in a vessel, sold iy him, or 
so Tmich thereof as may he neeessary to satisfy such execu- 
tion/ and if any hala/nce remain due, he shall sell, under 
such execution, so much of the property of such corporation 
remaining in his hands, as may he necessary to satiny 
such haloMce. ( 75 ) 
Proraed- I 25. If the plaintiff in such action be nonsuited, or 

jS^menTis discontinue the same, or judgment for any cause pass. 

antf"*'"^' against him, every such bond taken by the sheriff, all the 
proceeds of such sales, and all the property of such corpo- 
ration remaining in his hands, shall be delivered by such 
sheriff to the defendants or thejr agents, in the same man- 
ner and upon the same terms as are prescribed in the case 
of an attachment against an absent debtor being dis- 
charged ; and in case of the failure of such corporation to 
comply with such terms, the sheriff shall proceed in like 
manner as directed in case of an absent debtor. 
Penaityfor § 26. If it shall appear to the court that any such suit 

vemaons against a foreign corporation was brought vexatiously and 
without just cause, they shall award double costs against 
the plaintiff; and such plaintiff shall be liable to the de- 
fendants for all damages which they may sustain by such 
proceedings. 
Appear- § 27. At any time before the plaintiff in such suit shall 

feTdanto!*" have lost a trial therein, and after such time, upon good 
cause shown, the court may allow such corporation to ap- 
pear in the action and defend the same, upon such terms 
as the court shall think proper. 

(75) This section repealed by § 6 of the Act of April 11th, 1842 (Laws 
1842, Chap. 197, p. 227). See this aat, post. 



APPENDIX. 245 

§ 28. "Whenever such corporation shall have appeared Discharge 
in such suit, they may apply to the offlfcer who issued such ment.*" ' 
attachment, or to the court, for an order to discharge the 
same. 

§ 29. Upon such application, the said corporation shall Bond to bo 
deliver to the court or officer, a bond to the plaintiff in the ?J,Dt"nte.° 
suit, -with at least two sureties, residents and freeholders in 
this State, to be approved by such court or officer, in a pen- 
alty at least double the amount of the claim of such plain- 
tiff, proved as herein before directed, conditioned that the 
obligors in such bond will, on demand, pay the amount of 
the judgment that may be recovered against such corpora- 
tion, in such suit. 

§30. If there be more than one attachment issued .^r^eea-^^ 
against any foreign corporation, in behalf of several plain- seyeraisStfl! 
tiffs, at the same term, or during the same vacation of a 
term, and judgments be rendered in favor of such plaintiffs, 
the court shall apportion the proceeds arising from the 
sale of the defendant's property, among the said plaintiffs, 
in proportion to the amount of their respective judg- 
ments. ( 76 ) 



ACT OP MAY 14th, 1840. 

(LAWS 1840, CHAP. 354, P. 296.) * 



An Act to amend the Revised Statutes -mi relation to 
proceedings against absent debtors and foreign corpora- 
tions. Passed May lith, 184:0. 



The People of the State of New YorTc represented in 
Senate a/nd Assembly, do enact as follows: 

% 1. The eighth section of article first of title first of inventory, 
chapter five of part second of the Kevised Statutes, ismadfif°ef-° 
hereby amended so as to read as follows : ors'ltJenf' 

"He shall immediately, on making such seizure, with*"- 
the assistance of two disinterested free-holders, make a just 

(76) See the Acts of May 14ih, 1840, April 11th, 1842, May 13th, 1845 
February 2l8t, 1848, and March 15th, 1849, post. ' 



246 APPENDIX. 

and true inventory of all the property so seized, and of the 
books, vouchers, and papers taken into his custody, stating 
therein the estimated value of the several articles of per- 
sonal property, and enumerating such of them as are perish- 
able ; which inventory, after being signed by the sheriff, 
and the appraisers, shall, within ten days after such seizure, 
be returned to the officer who issued the warrant; and tbe 
reMrtveJebts sheriff shall, under the direction of such officer, collect, 
crefiits, &o. 'rcceivc, and take into his possession, all debts, credits, and 
effects of such debtor, and commence such suits and take 
coJeortheS^ ^uch legal proceedings in the name of such debtor, as may 
be necessary for that purpose; and which suits and pro- 
ceedings maybe continued by the trustees to be appointed 
as hereinafter directed, until a final termination thereof." 

§2. The twenty -first section of article first of title 

four of chapter eight of part three of the Revised Statutes, 

is hereby amended to read as follows : 

Powers of " The sheriff to whom such attachment shall be directed 

Lion to°for- and delivered shall proceed thereon in all respects in the 

tif^gf"''"™" manner prescribed by law in case of attachments against 

absent debtors, shall make and return an inventory, and 

shall keep the property seized by liim, or the proceeds of 

such as shall have been sold, to answer any judgment which 

may be obtained in such suit, and shall, under the direction 

of the ofiicer issuing such attachment, collect, receive, and 

tiei°s,OTed-* ^^^^ i'l'-o ^^^ posscssiou, all debts, credits, and effects of 

it8,&o. siich deb tar, and commence such suits and take such legal 

proceedings, either in his own name or in the name of such 

foreign corporation, as may be necessary for that purpose, 

and discontinue the same at such time and on such terms, 

as the said officer may direct." 

§ 3. The twenty-fourth section of article first of title 
four of chapter eight of part three of the Revised Statutes, 
is hereby amended to read as follows : 
inm'or°ud - " "^"' (^i^se judgment be rendered for the plmntiff in any 
merits against swcA suit, (Mid an execution he a/wa/rded thereon, the sheriff 
poralon"" shall assiffn to the jplaintif any bond taken Tyy him in the 
oowrse of the proceedings, and all debts, credits, and effects 
of stioh corporations as he may have seized, shall pay over 
to such plaintiff the proceeds of all sales of perishable prop- 
erty, and the proceeds of all said debts, credits, or effects as 
he may home received, or of. any vessel or share or interest 
in a vessel sold by Mm, or so much thereof as may be neces- 
sary to satisfy such execution ; and if any balance remain 
due, he shall sell under such execution so much of the prop- 



APPENDIX. 247 

enify of suoh corporation remainiThg in his hcmds, as may 
he necessary to satisfy such lalance." \_Repealed ly %Q of 
Chap. 127. 1842. See this act, post.'] 



ACT OF APRIL 11th, 1842. 

(LAWS 1842, CHAP. 197, P. 22Y.) 



An Act to a^mend the law in relation to suits against for- 
eign corporations. Passed April 11, 1842. 



The People of the State of New Yorh,- represented in 
Senate a/nd AssemMy, do enact as follows : 

% 1. The rights or shares which any foreign corporation g^^^j.^ 
may have or own in the stock of any bank, banking asso- funds, and 
ciation, insurance company, or other company or corpora- fore?|nco?p- 
tion, together with the interests, rents and profits due and "^^^j.™^^™*^ 
growing due thereon, and all trust property real or per- 
sonal, funds, deposits, moneys or credits, held by or due 
from any bank, insurance company, or other company or 
corporation or individual in this State, for and in behalf or 
to such foreign corporation, shall be liable to be attached 
in actions at law, and levied upon and sold to satisfy any 
judgment and execution. 

§ 2. The execution of the attachment upon any such ^tu^i^. 
rights or shares or. trust property, funds, deposits, moneys ment how 
or credits, shall be made by leaving a true and attested °^^™ ^ ' 
copy of the writ, by the oflficer serving the same, with his 
proper endorsement thereon, with the cashier of such bank, 
or with the secretary or clerk of such insurance company 
or other company or corporation, or with such individual 
holding such trust property, funds, deposits, moneys or 
credits ; and such rights or shares, together with the inter- 
est, rents, and profits of such trust funds, deposits, moneys, 
or credits, shall be holden to respond to the judgment 
which may be recoyered in such action, or to satisfy such 
execution. 

§ 3. Whenever a sheriff shall, with a writ of attach- ^^shermo^ 
ment or execution against a foreign corporation apply to with amount 



248 APPENDIX. 

shaJS" & ^^^^ cashier, secretary or clerk, or to sucli individual, for 
by offiW the pui'pose of so attaching or levying upon such rights or 
shares or such trust property, funds, deposits, moneys or 
credits, the cashier, secretary or clerk, or individual, shall 
furnish him with a certificate under his hand, in his official 
capacity, if he be an officer, designating the number of 
rights or shares such foreign corporation holds in the stock 
of such bank, company or corporation, with the incum- 
brances thereon, if any there be, and the amount of the 
dividend due thereon, or the amount and description of 
such trust property, funds, deposits, moneys or credits held 
by such company, corporation, or individual for the benefit 
of such foreign corporation. 
Duty of § ^- ^^ ^^^^ judgment be entered for the plaintifi" in 

'03"*'°*°^^^ any such suit, the sheriff shall satisfy the same out of the 
entlSdftr" property attached by hiin, if it shall be sufficient for that 
P'"-™ purpose. 

1. By paying over to such plaintiff the proceeds of all 
sales of perishable property, and of any vessel or share, 
or interest in any vessel sold by him, or so much as shall 
be necessary to satisfy such judgment. 

2. If any balance remains due and an execution shall 
have been issued on such judgment, he shall proceed to 
sell under such execution so much of the attached prop- 
erty, real or personal, as may be necessary to satisfy such 
balance, if enough for that purpose shall remain in his 
hands ; and in case of the sale of any such property as is 
mentioned in the first section of this act, the sheriff shall 
execute to the purchaser a deed or bill of sale thereof, and 
the purchaser shall thereupon on demand be entitled to all 
such property, deposits, trust property, funds, moneys, or 
credits, and all such rights and shares or stock, and shall 
have all the rights and privileges, in respect thereto, as 
were possessed by such foreign corporation. 

3. If any of the attached property or effects belonging 
to such foreign corporation shall have passed out of the 
hands of such sheriff by delivery or otherwise without 
having been sold, such sheriff shall repossess himself of 
the same ; and for that purpose, he shall have all the 
authority which he had to seize the same under the attach- 
ment ; and any person who shall willfully conceal, with- 
hold, or detain any such property or effects from the said 
sheriff, shall be liable to double damages at the suit of the 
parties interested and injured. 

4. Until the judgment against such foreign corporation 



APPENDIX. 249 

shall be paid, such sheriff shall proceed to collect the notes, 
hills, and other evidences of debt that may have been 
seized under such attachment, and to prosecute any bond 
which he may have taken in the course of such proceed- 
ings, and apply the proceeds thereof to the payment of 
such judgment ; and vs^hen such judgment and all costs 
of the proceedings shall have been fully paid, the sheriff 
upon reasonable demand shall deliver over to such foreign 
corporation, all the residue of such attached property or 
the proceeds thereof. 

§5. No. default or judgment shall be taken in any ■^g^_ 

such suit, until the plaintiff shall file with the clerk of the jj^^dgmmt 
court in which such suit shall be pending, evidence by pntii notice 
aifidavit or otherwise, that he has caused a notice to be'*^°^' 
published in the State paper and in one newspaper printed 
in the county where such attachment shall have been exe- 
cuted, at least once in each week for twelve weeks succes- 
sively, stating the issuing of the attachment, the names of 
the plaintiff and of his attorney, and of the ofl&eer who 
issued the attachment, and the nature and amount of the 
demand claimed against such foreign corporation. 

§ 6. The twenty-fourth section of article one, title Repeal, 
four, chapter eight, part three of the Revised Statutes 
and the third section of th* act entitled " An Act to 
amend the Eevised Statutes in relation to proceedings 
against absent debtors and foreign corporations," passed 
May 14r, 1840, are hereby repealed. 

§ 7. This act shall take effect immediately. [See amend- 
atory Act of May \Zih, 1845, jpost?[ 



ACT OP MAY 13th, 1845. 

(LAWS 1846, CHAP. 234, P. 256.) 



An Act to a/mend the la/w in relation to suits against For- 
eign Corporations. Passed May 13, 1845.1 



The People of the State of New YorTc, represented in 
Senate and Assembly, do enact as follows : 

§ 1. After judgment rendered for the plaintiff in any Provision 
suit commenced by attachment against a foreign corpora- ecuuonbetog 



250 APPENDIX. 

rotnmednn- tion, aiicl ail execution issued thereon shall have been re- 
satisfled. tumed unsatisficd in part or in whole, the party suing out 
such execution, or in case of a nominal plaintiff, the per- 
son beneficially interested therein, may commence any suit 
or suits at law or in equity, either in his own name or in 
the name of said foreign corporation, against any debtor 
to the said corporation, or against the subscribers to its 
capital stock, shareholders or stockholders, or any or all of 
them, to compel the payment of any sum or sums of money 
not paid in, or remaining due upon each share of the capi- 
tal stock subscribed or held by them, or any of them, or 
which may have been transferred with intent to avoid the 
payment of the said sum or sums of money ; and may re- 
cover in such suit or suits any sums to the amount due the 
plaintiff or plaintiffs, which such defendant or defendants 
could be liable to pay in any event in the State or govern- 
ment where such corporation is located, 
snits § 2. The suits authorized to be brought by or in the 

tbT^ameV iiame of the sheriff, by the act entitled "An act to amend 
sheriff how the Rcvised Statutes in relation to proceedings against ab- 
sent debtors and foreign corporations, passed May 14th, 
1840, and by the act entitled " An act to amend the law 
in relation to suits against foreign corporations," passed 
April 11th, 1842, may be*prosecuted by the attacliing 
creditor or party beneficially interested in the attach- 
ment, by an attorney or solicitor to be employed by him, 
and at his costs and charges, upon delivering to the said 
sheriff a bond in the penalty of five hundred dollars, with 
two sureties, to be conditioned to indemnify and save the 
said sheriff harmless from all damages, costs and expenses 
of said suit. The said sureties shall in all cases where- 
in it shall be required by the sheriff, justify as good and 
sufficient sureties, by making an affidavit that each of them 
is a householder, worth double the amount of the penalty 
of the said bond, over and above all demands and liabili- 
ties, which justification shall be made before any officer 
authorized to take the justification of bail in the court out 
of which said attachment was issued, upon at least one 
day's notice in writing to such sheriff. 

§ 3. This act shall take effect immediately. 



APPENDIX 251 

ACT OF FEBRUARY 21st, 1848. 

(LAWS 1848, CHAP. 53, P. 6tf.) 



An Act to amnend the act, entitled "An act to wmend 
the law in relation to smts agmnst foreign corporations. 
Passed Febrioa/ry 21, 18i8. 



The People of the State of New YorTc, represented in 
Senate and AssemMy, do enact as follows : 

§ 1. In case' any cashier, secretary, clerk or individual, Cashier, 
upon whom any sheriff shall serve any such attachment or ofcirak^how 
execution, shall refuse to furnish him with the certificate ^^^^3^' 
required in and by the third section of the act passed April, 
11, 1842, entitled " An act to amend the law in relation to 
suits against foreign corporations," chapter one hundred 
and ninety-seven, then it shall be lawful for the plaintiff in 
such attachment or execution, to require the examination 
of such cashier, secretary, clerk or individual, before any 
officer of the court out of which said, attachment or execu- 
tion shall have issued. 

§ 2. The provisions of sections twelve, thirteen, fourteen, sections of 
fifteen, and sixteen, of article eight of title first, chapter cable.*'''' ' 
fifth, part second of the JRevised Statutes, in relation to the 
mode of examining nonresident debtors, or persons indebt- 
ed to them, or having property of theirs in his or their 
possession, shall apply to and govern the examinations au- 
thorized to be had in and by this act, so far as the same 
may be applicable. 

§ 3. This act shall take effect immediately. 



252 APPENDIX. 

ACT OP MARCH 15th, 1849. 

(LAWS 1849, CHAP 107, P. 142.) 



An Act to extend the remedies at loM agamst Foreign 
Insurance Oonvpanies. Passed Ma/rch 15, 18i9. 



The People of the State of New Yoi-h, represented in 
Senate and Assemhiy, do enact as follows : 

§ 1. Section fifteen, article one, title four, chapter eight, 
part third, of the Revised Statutes, is hereby amended, so 
as to read as follows : 
snitBwhere § 15. Sults may be brought (in the Supreme Court, in the 
be brought Superior Court of the city of New York, and in the court of 
Common Pleas in and for the city and county of New York,) 
against any corporation, created by or under the laws of 
any other State, government, or country, for the recovery 
of any debt or damages, whether liquidated or not, aris- 
ing upon contract made, executed, or delivered, within 
this State, or upon any camse of action a/rising therein : 
such suits may be commenced by complaint and summons 
together with an attachment, as now provided by law; and 
such complaint and summons may be served as provided 
by sections one hundred and thirteen and one hundred 
and fourteen, of the Code of Procedure. 
§ 2. This act shall take effect immediately. 



APPENDIX. 253 

CODE OF PROCEDURE, 

OF THE STATE OF NEW YOEK. 



TITLE XIII. 

OHAPTEE I. 



ACTIONS AGAINST FOREIGN CORPORATIONS. 

§ 427. Wheve and hy whom Irought. 

An action against a corporation created by or under the 
laws of any other State, government, or country, may be 
brought in the Supreme Court, the Superior Court of the 
City of New York, or the Court of Common Pleas for the 
City and County of New York, in the following cases : 

1. By a resident of this State, for any cause of action. 

2. By a plaintiff, not a resident of this State, when the 
cause of action shall have arisen, or the subject of the ac- 
tion shall be situated, within this State. [As to Attach- 
ments, See Code of Procedwre, (1861-1852), Section 227 to 
243.] 



REVISED STATUTES. 

PAKT II. CHAPTEE IT. TITLE II. 
(1 B. S. 767—771.) 



TITLE II. 

OF PROMISSORY NOTES AND BILLS OF EXCHANGE. 

§ 1. All notes in writing, made and signed by any per- Promissory 
son, whereby he shall promise to pay to any other person, wi loSr 
or his order, or to the order of any other person, or unto n^"^^?"^' 
the bearer, any sum of money therein mentioned, shall be 
due and payable as therein expressed ; and shall have the 



254 APPENDIX. 

Their effect same effeet, and be negotiable in like manner, as inland 

bills of exchange, according to tbe custom of merchants. 
Signature §2. Every such note, signed by the agent of any person, 
by agent. fij].^Qy- a general or special authority, shall bind such per- 
son, and shall have the same effect, and be negotiable, as 
above provided. 
Corporations § 3. Ihc v7ord "persou" iu the two last preceding sections, 
mciuded. gii^U be construed to extend to every corporation, capable 
by law of making contracts. 

§ 4. The payees and endorsees of every such note paya- 
ble to them, or their order, and the holders of every such 
note payable to bearer, may maintain actions for the sums 
of money therein mentioned, against the makers and en- 
dorsers of the same respectively, in like manner as in 
cases of inland bills of exchange, and not otherwise. 
Effect when § 5. Sucli uotcs made payable to the order of the maker 
Sor of'makerl thereof, or to the order of a fictitious person, shall, if ne- 
^- gotiated by the maker, have the same effect, and be of the 

same validity, as against the maker and all persons having 
knowledge of the tacts, as if payable to bearer. 
Accept. § 6. No person within this State shall be charged, as an 
to be ixi writ- acceptor on a bill of exchange, unless his acceptance shall 
jng, &e. -fjg jjj writing, signed by himself, or his lawfal agent, 
acw^^tanee § '^' ^^ s^<^^ accoptauce be written on a paper, other 
on separate than the bill, it shall not bind the acceptor, except in favor 
paper. ^£ ^ person to whom such acceptance shall have been 
shown, and. who, on the faith thereof, shall have received 
the bill for a valuable consideration. ■ 
Written g 8. An Unconditional promise, in writing, to accept a 
BoeSt^* " bill before it is drawn, shall be deemed an actual accept- 
ance, in favor of every. person who, upon the faith thereof, 
shall have received the bill for a valuable consideration. 
Eefasaito § 9. Every holder of a bill, presenting the same for ac- 
aocepton geptance, may require that the acceptance be written on 
the bill. A refusal to comply with such request shall be 
deemed a refusal to accept, and the bill may be protested 
for non-acceptance. 
Eights of § 10. The four last sections shall not.be construed to im- 
ceSVases, pair the right of any person, to whom a promise to accept 
feoteo.'^* '^" ^ ^'^^ ™^.y ^^^^ heen made, and who, on the faith of such 
promise, shall have drawn or negotiated the bill, to re- 
cover damages of the party making such promise, on his 
refusal to accept such bill. 
Destroying § 11. Every person, upon whom a bill of exchange is 
w return 1^ drawu, and to whom the same is delivered for acceptance. 



APPENDIX. 253 

who shall destroy such bill, or refuse, within twenty-four, when accept- 
hours after such delivery, or within such other period as™"*' 
the holder may allow, to return the bill accepted or non- 
accepted, to the holder, shall be deemed to have accepted 
the same. 

§ 12. "Whenever the board of health of the city of New in case of 
York, or any other competent authority, shall, by public Sfew-YorV 
notice, designate any portion or district of the said city as ^^j^^?'^,°'j[,"' 
being the seat, of any infectious or contagious disease, and be kept by 
declare communication with such portion or district dan- 
gerous, or shall prohibit such communication, it shall be 
the duty of the clerk of the said city and county, during 
the continuance of such disease in such district, to provide 
and keep in his office a book, for the purpose of registering 
in alphabetical order, the names, firms, and places of busi- 
ness of any inhabitant of the city, who shall desire such 
registry to be made. 

§13. It shall be the duty of all persons and firms usually inhabitants 
resident or doing business within such infected district, to ISe^^nam'es, 
register in the book so provided by the said clerk, their ^°8i^eBs°Ito* 
names or firms, with the place or places out of such in- 
fected district, but within the county of New York, to 
which they may have removed the transaction of their 
business, or to which they may desire any notices to be 
sent or served, or any notes, drafts, or bills to be presented 
for acceptance or for payment. The sum of twenty-five ^°™'''°'"''' 
cents may be claimed and received by the said clerk for jjcgister 
every such registry; but the book in which the same shall may be ex-- 
be entered, shall be, at all times during office hours, open to """"^ ^""' 
public examination, free of all charges. 

§ 14. During the continuance of any such disease in such Acceptances, 
infected district, all drafts, notes and bills which by law are demSa*" 
to be required to be presented for acceptance or for pay- 
ment, may be presented for such purpose at the place so 
designated in such registry ; and all notices of non-accept- Notices, &a., 
ance and of non-payment, of any note, draft or bill, or of ™Jt toTg-'' 
protest, for such non-acceptance or non-payment, may be'""^^P'"'°- 
served by leaving the same at the place so designated. 

§ 15. In case any person or firm, usually resident or do- ^^I'^^s'strr. 
ing business within such infected district, shall neglect to drafts, &«'., 
make and cause to be entered in the book so provided, the ^^^"10"^'' 
registry herein required, all notes, drafts or bills, which '''^*- 
by law are required to be presented to such person or firm 
for acceptance or for payment, may be presented to the 
said clerk of the city and county of ISTew York, during 



256 • APPENDIX. 

the continuance of sucli disease, at any time during office 
hours ; and demand of acceptance or payment thereof may 
be made of the said clerk, to the same purpose and witt 
the same effect, as if the same had been presented, and 
acceptance or payment demanded, of such person or firm, 
at their usual place of doing business. 
Ana notices, § 16. In case of the omission to make the registry herein 
ieftSp^at- required, all notices of the non-acceptance or non-payment 
office. Qf g^jjy note, draft or bill, or of protest for such non-accept- 
ance or non-payment, may be served on any person or firm, 
usually resident or doing business within such infected dis- 
trict, by leaving the same at the post-ofiBce for the said city 
of JS^ew York ; which service shall be as valid and effect- 
ual, as if the notices had been served personally on such 
person, or one of such firm, at his or their usual place of 
doing business. 
When pesti- 1 17. Whenever proclamation shall be made by the board 
to'have bX'^ of health, or other proper authority of the city of New 
sided, York, that an infectious or contagious disease, in any such 
infected district, has subsided, it shall be deemed to ha^e 
subsided, for all the purposes contemplated in this title. 
Damages § 18. The rate of damages to be allowed and paid upon 
ment offl's. '''^^ usual protest for non-payment of bills of exchange, 
drawn or negotiated within this State, shall in the follow- 
ing cases be as follows : 
Bills oncer- !• If such bill shall have been drawn upon any person 
and easton" ^^ pcrsons at any place in either of the States of Maine, 
states. l^ew Hampshire, Vermont, Massachusetts, Rhode Island, 
Connecticut, l^ew-Jersey, Pennsylvania, Ohio, Delaware, 
Maryland, or Virginia, or in the district of Columibia, three 
dollars upon the hundred, upon the principal sum specified 
in such bill. 
On certain 2. If such bill shall have been drawn upon any person 
western" ""^or persons at any place in either of the States of Iforth- 
Btetea. Carolina, South-Carolina, Georgia, Kentucky or Tennes- 
see, five dollars upon the hundred, upon the principal sum 
specified in such bill, 
ther ^- -"-^ ^^ch bill be drawn upon any person or persons at 
statesand any placo, in any other State or territory of the United 
TOnttoe°nt,'&c States, or at any other place on, or adjacent to, this conti- 
nent and north of the equator, or in any British or other 
foreign possessions in the West Indies, or elsewhere in the 
western Atlantic ocean, ten dollars upon the hundred. 
Bills on i^po^ the principal sum specified in such bill. 
Europe. i. If such bill sliall have been drawn upon any person 



APPENDIX. 257 

or persons at any port or place in Europe, ten dollars upon 
the hundred, upon the principal sum specified in such bill. 

§ 19. Such damages shall be in lieu of interest, charges Damages to 
of protest, and all other charges incurred previous to and certainlnter- 
at the time of giving notice of non-payment ; but the ^^ «''«"■£'". 
holder of such bill shall be entitled to demand and recover 
lawful interest upon the aggregate amount of the principal 
sum specified in such bill, and of the damages thereon, 
from the time at which notice of protest for non-payment 
shall have been given, and payment of such principal sum 
shall have been demanded. 

§ 20. If the contents of such bill be expressed in the Norefer- 
money of account of the United States, the amount due o? excha"^ 
thereon, and of the damages herein allowed for the non- payable' "u 
payment thereof, shall be ascertained and determined """ey of u. 
without any reference to the rate of exchange existing be- 
tween this State and the place on which such bill shall 
have been drawn, at the time of the demand of payment, 
or of notice of non-payment, 

§ 21. K the contents of such bill be expressed in the otherwise 
money of account or currency of any foreign country, wein «>reign 
then the amount due exclusive of the damages payable ™™'"'^- 
thereon, shall be ascertained and determined by the rate 
of exchange, or the value of such foreign currency, at the 
time of the demand of payment. 

§ 22. Where a bill of exchange shall be protested for Damages 
non-acceptance, the same rate of damages shall be allowed °^ '"'°""=- 
on the protest for non-acceptance, as provided in the fourwus. 
last sections ; and shall be in lieu of interest, charges of 
protest, and all other charges incurred previous to and at 
the time of giving notice of non-acceptance; but the 
holder shall be entitled to recover interest upon the aggre- 
gate amount of the principal sum specified in the bill and 
of the damages thereon, from the time at which notice of 
protest for non-acceptance shall have been given. 

§ 23. The damages allowed by this Title, shall be recov- who to re- 
ared only by the holder of a bill who shall have purchased dam^l"."" 
the same, or some interest therein, for a valuable considera- 
tion. 

§ 24. In all cases where a notice of non-acceptance of a Notices hy 
bill of exchange, or non-payment of a bill of exchange, be'direci'etL" 
promissory note, or other negotiable instrument, may be 
given by sending the same by mail, it shall be sufiicient if 
such notice be directed to the city or town where the per- 
son sought to be charged by such notice resided at the time 
17 



258 APPENDIX. 

of drawing, making or endorsing such bill of exchange, 

promissory note or other negotiable instrument, unless 

such person at the time of affixing his signature to such 

bill, note, or other negotiable instrument, shall in addition 

thereto specify thereon the post-office to which he may 

require the notice to be addressed. 

Appiica- § ^^" J^othing in this act shall apply to bills of ex- 

tionof last change, promissory notes, or other negotiable instruments, 

section. jjiade or drawn before this act takes effect. 



ACT OF APRIL 23, 1835. 

(LAWS 1835, CHAP. 141, P. 152.) 



An Act in relation to Sills of Exchange and Promissory 
Notes. Passed April 23, 1835. 



The People of the State of New York, represented in 
Senate amd Asseonbly, do enact as follows : 

Notice, how § 1- In all cases where a notice of non-acceptance of 
tobogiven. g^ ^j.]j of exchange, or non-payment of a bill of exchange, 
promissory note or other negotiable instrument, may be 
given by sending the same by mail, it shall be sufficient 
if such notice be directed to the city or town where the 
person sought to be charged by such notice resided at the 
time of drawing, making, or endorsing such title of ex- 
change, promissory note or other negotiable instrument, 
unless such person at the time of affixing his signature to 
such bill, note, or other negotiable instrument, shall in 
addition thereto, specify thereon the post-office to which he 
may require the notice to be addressed. 

§ 2. Nothing in this act shall apply to bills of ex- 
savin; chaiigc, promissory notes, or other negotiable instruments 
eiause. made or drawn before this act takes effect. 



APPENDIX. 259 



ACT or APRIL 4th, 1849. 

(LAWS 1849, CHAP. 261, P. 392.) 



An Act to designate the holidays to ie observed in the ac- 
ceptance and payment of Bills of Exchange and 
From/hssory Notes. Passed April 4, 1849. 



The People of the State of New YorTc, represented m 
Senate and Assembly, do enact as follows : 

§ 1. The following days, viz. : the first of January, ^"''^^^^ 
commonly called New-years day, the fourth day of July, 
the twenty-fifth day of December, commonly called Christ- 
mas day, and any day appointed or recommended by the 
governor of this State, or the President of the United 
States, as a day of fast or thanksgiving, shall for all pur- 
poses whatsoever as regards the presenting for payment or 
acceptance, and of the protesting and giving notice of the 
dishonor of bills of exchange, bank checks and promissory 
notes, made after the passage of this act, be treated and 
considered as is the first day of the week, commonly called 
Sunday. 



260 APPENDIX. 

REVISED STATUTES. 

PAKT II., CHAPTEE lY., TITLE III. 

(1 E. S. 771—773.) 



TITLE III. 

OF THE INTEREST OF MOIfEY. 

§ 1. The rate of interest upon the loan or forbearance 
of any money, goods or things in action, shall continue to 
be seven dollars upon one hundred dollars for one year, 
and after that rate for a quarter or less sum, or for a longer 
or shorter time. 
Greater in- § 2. No pcrsou Or Corporation shall, directly or indi- 

hlbitei"" rectly, take or receive in money, goods or things in action, 

or in any other way, any greater sum or greater value, for 

the loan or forbearance of any money, goods or things in 

action, than is above prescribed. 

Excess paid § 3. Every person, who, for any such loan or forbear- 

coveredbtok^"^®' shall pay or deliver any greater sum or value than is 

in one yeaf. abovc allowcd to be reccived, and his personal representa- 
tives, may recover in an action against the person who 
shall have taken or received the same, and his personal 
representatives, the amount of the money so paid or value 
delivered, above the rate aforesaid, if such action be 
brought within one year after such payment or delivery. 
When to § 4:. If such suit be not brought within the said one year, 

be recovered ^jj^ proseciited with cffcct, then the said sum may be sued 

by oversfers n ^ -, i ■ t • • i . i 

of poor, &o. tor and recovered with costs, at any time withm three 
years after the said one year, by any overseer of the poor of 
the town where such payment may have been made, or by 
any county superintendent of the poor of the county in 
which the payment may have been made. 
„ , , S 5. All bonds, bills, notes, assurances, conveyances, all 

Contracts tf ' ;, ' ini .'« 

for greater other coutracts or securities whatsoever, and all deposits oi 
som, void. gQjj^g Qp other things whatsoever, whereupon or whereby 
there shall be reserved or taken, or secured, or agreed to 
be reserved or taken, any greater sum or greater value, 
for the loan or foibearance of any money, goods or things 
in action, than is above prescribed, shall be void ; but 
Except ne-j-j^jg scctiou shall not extend to any bills of exchange or 



APPENDIX. 261 

promissory notes, payable to order or bearer, in the hands go'J''i''fW'>. 

£ - •/ 1^1*1 1 1 n 1 • T .1 and notes in 

ot an endorsee or holder, who shall have received the same hands of 
in good faith, and for valuable consideration, and who hadoSt'^notice.'' 
not, at the time of discounting such billor note, or pay- 
ing such consideration for the same, actual notice, that 
such»bill or note had been originally given, for a usu- 
rious consideration, or upon a usurious contract. [This 
Section amended 'by%l of the Act of May 15, 183T. See 
this act, post.'] 

§-6. Every person offending against the provisions of offenders 
this Title, shall be compelled to answer on oath any bill ^?™f;f,';'i'° 
that may be exhibited against him in the court of chan- 
cery, for the discovery of any sum of money, goods or 
things in action so taken, accepted or received, in viola- 
tion of the foregoing provisions, or either of them. 

§ 7. Every person who shall discover and repay or re- ioiscovery, 
turn the money, goods, or other things so taken, accepted further pen- 
or received, or the value thereof, shall be acquitted and*"''- 
discharged from any other or further forfeiture, penalty or 
punishment, which he may have incurred by taking or 
receiving the money, goods or other thing so discovered 
and repaid, or returned as aforesaid. 

§ 8. Whenever any borrower of any money, goods or Borrower 
things in action, shall file a bill in chancery for a discov-^'^'swiinot 
ery of the money, goods or things -in action taken or re- rest on 'sum 
ceived, in violation of either of the foregoing provisions, '""""'■ 
it shall not be necessary for' him to pay, or offer to pay, 
any interest whatever on the sum or thing loaned ; nor 
shall any court of equity require or compel the payment, prJ^cfpaifw- 
or deposit, of the principal sum, or any part thereof, as a'"™^''- 
condition of granting relief, to the borrower in any case 
of a usurious loan forbidden by this chapter. 

§ 9. For the purpose of calculating interest, a month MoDthsand 
shall be considered the twelfth part of a year, and as con- i6^reck™ed. 
sisting of thirty days ; and interest for any number of 
days, less than a month, shall be estimated by the propor- 
tion which such number of days shall bear to thirty. 

§ 10. "Whenever, in any statute,- act, deed, written or Howinte- 
verbal contract, or in any public or private instrument ■'^'j'J° '>?"='''- 
whatever, any certain rate of interest is or shall be men- certain case, 
tioned, and no period of time is stated for which such rate 
is to be calculated, interest shall be calculated at the rate 
mentioned, by the year, in the same manner as if the 
words "per annum" or "by the year," had been added to 
such rate. 



262 APPENDIX. 



ACT OP MAY 15, 1837. 

(LAWS 1837, CHAP. 430, P. 486.) 



An Act to prevent usv/ry. Passed May 15, 1837. 



The People of the State of New^ Yorh, represented in 
Senate and Assenibly, do enact as follows : 

Amend- § ^' '^'^® J?/'^^ Section of Title three, of chapter four, 

mentofflftu part two of the Remsed Statutes is hereby amended so as 

°*°"'"=- to read as follows : 

§ 5. All bonds, bills, notes, assurances, conveyances, all 
other contracts or securities whatsoever (except bottomry 
and respondentia bonds and contracts), and all deposits of 
goods or other things whatsoever, whereupon or whereby 
there shall be reserved or taken, or secured or agreed to 
be reserved or taken, any greater sum, or greater value, 
for the loan or forbearanc e of any money, goods or other 
things in action, than is above prescribed, shall be vnid; 
but this act shall not affect such paper as has been made 
and transferred previous to the time it shall take effect. 
Witnesses. § 2. Whenever in an action at law the defendant shall 
plead or give notice of the defence of usury, and shall ve- 
rify the truth of his plea or notice by aifSdavit, he may, for 
the purpose of proving the usury, call and examine the 
plaintiff as a witness, in the same manner as other wit- 
nesses may be called and examined. 
Offenders § 3. Every pcrsou offending against the provisions of 

anS^el!^* *" the Said title, or of this act, may be compelled to answer 
on oath, any bill that shall be exhibited against him, in the 
court of chancery, for relief, or discovery, or both. 
Bills in § 4. Whenever any borrower of money, goods, or things 

Chancery. ^^ actiou, sliall file & bill iu chancery, for relief or discov- 
ery, or both, against any violation of the provisions of the 
said title or of this act, it shall riot be necessary for him to 
pay or offer to pay any interest or principal ou the sum or 
thing loaned ; nor shall any court of chancery require or 



APPENDIX 263 

compel the payment or deposit of the principal sum_ or 
interest, or any portion thereof, as a condition of granting 
relief or compelling or discovering to the borrower in any 
case, usurious loans forbidden by said title or by this act. 

§ 5. Whenever it shall satisfactorily appear by the ad-oourtT*' ° 
missions of the defendant, or by proof, that any bond, bill, 
note, assurance, pledge, conveyance, contract, security, or 
any evidence of debt, has been taken or received in viola- 
tion of the pi'ovisions of said title or of this act, the court 
of chancery shall declare the same to be void, and enjoin 
any prosecution thereon, and order the same to be surren- 
dered and cancelled. 

§ 6. Any person vpho shall directly or indirectly re- ^^f ™'^''' 
ceive any greater interest, discount, or consideration than 
is prescribed in the said title, and in violation of the pro- 
visions of said title or of this act, shall be deemed guilty 
of a misdemeanor, and on conviction thereof, the person 
so offending shall be punished by fine not exceeding one 
thousand dollars, or imprisonment not exceeding six 
months, or both. 

§ 1. It shall be the duty of all courts of justice to oonrt to 
charge the grand jury especially to inquire into any viola-fun^f* ^""' 
tion of the provisions of the said title, or of this act. 

§ 8. Every plaintiff examined as .a witness pursuant to 1'°°'=''- 
the provisions of this act, or any defendant under the pro- swearing.^ 
visions of this a,ct, who shall swear falsely, shall upon con- 
viction thereof suffer the pains and penalties of wilful and 
corrupt perjury ; but the testimony given by any plaintiff, 
or the answer of any defendant, made pursuant to the 
said title or of this act, shall not be used against such per- 
son before any grand jury, or on the trial of any indict- 
ment against such person. 

§ 9. So much of title third, chapter fourth and part Repeal. 
second of the Eevised Statutes, as is inconsistent with the 
provisions of this act, is hereby repealed. 

§ 10. This act shall take effecf on the first day of July /otjotake 

^'l J J effect Jnlrl^ 

next. 1831. 



264 APPENDIX. 

ACT OF APRIL 6, 1850. 

(LAWS 1850, CHAP. 172, P. 334.) 



An Act to prohibit corporations from vnterposmg the 
defence of usv/ry in any action. Passed April 6, 1850. 



The People of the State of New York, represented im, 
Senate and AssemMy, do enact as follows : 

Defence of § 1 • ~So Corporation shall hereafter interpose the de- 
uBiiry. fence of usury in any action. 

} 2. The term corporation, as used in this act, shall be 
'construed to include all associations and joint stock com- 
panies having any of the powers and privileges of corpo- 
rations not possessed by individuals or partnerships. 
§ 3. This act shall take effect immediately. 



Corporation. 



CONSTITUTION OP THE STATE OP 
NEW YORK. 

{Adopted in 1846.) 



AETICLE VIII. 

Corpora- § 1. Corporatious may be formed under general laws ; 
created.'"' but shall uot be created bj special act, except for munici- 
pal purposes, and in cases where, in the judgment of the 
legislature, the objects of the col'poration cannot be ob- 
tained under general laws. All general laws and special 
acts, passed pursuant to this .section, may be altered from 
time to time, or repealed. 
Dehts of § 2. Dues from corporations shall be secured by such 

corporations, individual liability of the corporators and other means as 
may be prescribed by law. 
"Corpora- § 3. The term corporations, as used in this article, shall 
flned.'''^' be construed to include all associations and joint stock 



APPENDIX. 265 

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 
he subject to be sued in all courts in like cases as natural 
persons. 

§ 4. The legislature shall have no power to pass any charters 
act granting any special charter for banking purposes ; butpmpoBes."*' 
corporations or associations may be formed for such pur- 
poses under general laws. 

§ 5. The legislature shall have no power to pass any spectepay- 
law sanctioning in any manner, directly or indirectly, the™™'°" 
suspension of specie payments by any person, association 
or corporation issuing bank notes of any description. 

§ 6. The legislature shall provide by law for the regis- Eegistryof 
try of all bills or notes issued or put in circulation as^'"°°"'°'*^ 
money, and shall req^uire ample security for the redemp- 
tion of the same in specie. 

§ 7. The stockholders in every corporation and joint inaividnai 
stock association for banking purposes, issuing bank notes trKock-' 
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 and fifty. 

§ 8. In case of the insolvency of any bank or banking rnooivenoy 
association, the bill holders thereof shall be entitled to prefmesM. 
preference in payment over all other creditors of such 
bank or association. 



^SQ APPENDIX. 



NEW YORK CLEARING HOUSE. 



Foe two years past, the banks of the City of New York 
have conducted their exchanges with each other through 
the Clea/ring House. The adoption of this system lias not 
only saved much labor, but has led to important changes 
in the manner of doing business. Some account of its 
origin, its working, and its results, will not be deemed 
inappropriate here. 

At the time when this institution started, fifty-seven 
banks, between which exchanges had to be made, were 
doing business in the city of New York. On the plan 
then in use, each bank must have an account with every 
other bank. In fact, each one of these institutions kept a 
City BmiJc Ledger of fifty-six bank accounts, and also, on 
their General Ledger, an account with " City, Banhs," 
which account was made np of the totals of the fifty-six 
accounts in the City Bank Ledger. Thus, each bank, 
which exchanged with all its associates, was compelled to 
keep fifty-seven open, active accounts. It follows, that the 
whole number of such accounts, supposing- that all ex- 
changed with all, was three thousand two hundred and 
forty- nine. This, however, would overstate the actual fact, 
as there were always some exceptions to a universal and 
reciprocal exchange. 

Each bank received from its dealers, on, deposit or in 
payment of notes, &c., the bills of and cheeks upon every 
other city bank, and also of banks not in the city, if they 
redeemed atfo/r through some bank in it. At the close 
of the day's transactions, the funds thus received were as- 
sorted and brought together. The items for each bank were 
entered on t slip, with the total amount in which each was 
debited. To these, on the following morning, were added 
such items ascame by mail, or from any other source before 
the delivery of the exchanges. For the total amount, after 
such additions, an entry had to be made to the debit of 
each bank whose exchange had been increased. 



APPENDIX. 267 

The exchanges were then sent from bank to bank. _ For 
two hours and more the tellers and porters were occupied in 
their reception and delivery ; before the result could be 
known, it was necessary to receive the last exchange, to 
make at least fifty-six debit and credit entries on tbe books 
of the respective banks, and the same number of entries in 
the pass-books used in exchanging. That is, there were 
one hundred and twelve postings on each of the fifty -six 
City Bank Ledgers. Thus an aggregate of about six thou- 
sand five himdred entries and postings were required daily, 
in making the exchanges. There were so many banks, that 
it took a large part of their time to exchange and settle 
with one another. 

Their balances were paid in coin, and the custom was 
to settle them on Friday of each week, though all were at 
liberty to diaw at pleasure for balances due. Every bank 
was daily a debtor to some banks, and a creditor of others. 
Ttiis happened, whether a bank were, in the aggregate, deb- 
tor or creditor. When a settlement was made, each bank 
had to draw off, on a separate book, the city bank balances 
as they stood on the morning of settlement-day after the 
exchanges were made. 

"When the money market was stringent, or specie was 
want ed for shipment, the banks often drew on one another, 
without waiting for the regular settling day. After the week- 
ly statement la/w went into force (see pp. 195, 196, anti) 
they used to draw nearly every day. The course of oper- 
ation was somewhat as follows : — A bank, wanting specie, 
drew on some other bank which owed it a balance ; this 
batik paid, probably, with a draft on some other bank 
which owed it. Then came a general drawing of drafts, 
extending to all the banks, and lasting through the bank- 
ing hours. Next came a movement of specie from bank 
to bank, all over the city. Some paid, others took, — one or 
the other, all did ; and when the movement was over, they 
were just as near a settlement as when they began. All 
this expensive fuss was occasioned often by a small defici- 
ency of coin in some particular quarter. 

Often, the result of such movements was a general want 
of confidence, followed by a contraction of loans, by need- 
less panics, and fluctuating stock markets. A system at- 
tended with so much labor and uncertainty, so productive 
of errors, of competition, and disagreement, could not be 
long endured. The want of some better system for the 
mutual exchanges and settlements of the banks, was gener- 
ally and strongly felt. The General Bank Act and the 



268 APPENDIX. 

ntimerons banks to which it gave rise, the passage of stricter 
laws in regard to banking, and especially of that which 
required the rendering of a weekly statement, tended much 
to make more apparent the necessity of some change. 

But though bank officers talked the matter over, and 
though various schemes and remedies were suggested, in con- 
versation and through the papers,nothing effectual was done, 
until 1853. On the 23d of August in that year, in obedi- 
ence to a call from the Meclianici Bcmk, a meeting of bank 
officers was held to consider the suBJpct. Sixteen Presi- 
dents, one Yice-President, and twenty-one Cashiers were 
present, the representatives of thirty-eight banks. No such 
meeting had occurred for a long time. Among the officers 
of the older banks there were several who had not met for 
years, and quite a number of the gentlemen were wholly 
unacquainted, l^otwithstanding this, the meeting proved 
remarkably harmonious. The necessity of some change in 
the prevailing system was fully recognized, and a commit- 
tee was appointed to consider the subject and report a plan. 
A series of meetings followed, which resulted in forming an 
association of banks, and in the establishment, by that associ- 
ation, of the New York Clearmg House. '1 he Clearing 
House commenced operations under the direction of a com- 
mittee appointed by the associated banks. Their names 
follow : — 

Feaitois W. Edmonds, Cashier of the Mechanics' Bank. 
James Punnett, Cashier of the Bank of America. 
Augustus E. Silliman, Cashier of the Merchants' Bank. 
John L. Eveeitt, Cashier of the Broadway Bank. 
KioHAED Beeet, Cashier of the Tradesmens' Bank. 

By this committee, Me. Gkoege D. Lyman, then a 
teller in the BanJc of North America, was appointed Man- 
agee of the Cleaeing House, to be assisted by two Clerks ; 
soon after. Me. Jacob Stout was made Assistant Manager. 

The institution thus organized, has been in successful 
operation from that time. At its commencement, there 
were iifty-two banks in the association, forty-eight of which 
are still associated. Tlie five banks which declined joining 
were small institutions. Two or three of them subsequently 
sought admission, which it was not thought advisable to 
grant. 

No bank can now do business unless it is admitted to 
the Clearing House, or makes its exchanges through some 
bank belonging to the association. Such an arrangement 



APPENDIX. 269 

is too inconvenient to be extensively adopted. As no new 
banks have been established since the Clearing House be- 
gan, its creation has evidently proved a wholesome check 
upon excessive banking. 

On the day when the Clearing House began business, 
about twenty-seven hundi-ed open active accounts on the 
ledgers of the associated banks, were balanced, — the most 
of them for the first time, and all of them finally. The 
business which had rendered necessary this large number 
of accounts, was thenceforth accomplished more quickly, 
with less annoyance to bank officers, and with greater 
safety to all concerned. 

While there was an immense saving of time and labor, 
the incidental benefits resulting far exceeded the expecta- 
tions of those who projected the establishment. It has 
strengthened the entire banking system of the city; it 
tends to prevent sudden contractions and expansions ; 
makes the business of banking more uniform, regular, and 
safe ; while the banks themselves are really more inde- 
pendent. Each bank now regulates its affairs by the daily 
position of its balances with the Clearing House; knowing 
that its debtor balances must be paid, every day in full, 
and. that its credit balances will be received in the same 
way. As the daily movements of each bank in the asso- 
ciation can be known by inspecting the accounts of the 
Clearing House, every bank knows how to govern its ex- 
changes with its associates, and may conduct its own busi- 
ness with entire independence of other banks. Under the 
old mode, banks had no means of knowing each others' 
situation. The Clearing House books show' this, and are 
open to all the members. The value of such information 
must be evident to all. This association of the banks gives 
strength to them all. No bank which does not manage its 
business on a safe basis, and according to the true princi- 
ples of banking, will be received or retained by the associa- 
tion. 

It is quite clear that the associated banks have a great 
advantage over any which may try to do business inde- 
pendently of the Clearing House. The daily settlement, in 
full, of balances, is sure to correct any tendency among 
the associates, to excessive banking. Such a state of things 
becomes immediately known to all, is followed by loss of 
credit and standing, and, if continued, by suspension or 
expulsion ; and this is the same as utter ruin. Credit 
is essential in the conducting of banking business ; and if a 



270 APPENDIX. 

bank has not enougli of this essential to make its exchanges, 
it can no longer do business, and must wind up. 

In the bank association of the NewYork Clearing House, 
there is a common bond of union. All have an equal voice 
in its management. All share alike in its privileges and 
benefits. In an important sense, the interest of each is thus 
made the interest of all. Nor is it a slight advantage that 
it brings together, and makes acquainted, tbe officers^ of the 
several banks — and thus leads to harmony both of feeling 
and action. While each institution still seeks for itself the 
highest profit consistent with security, all are brought to 
feel that they have a common inteiest in maintaining the 
credit of the banking system. 

All must be aware that the prosperity of the city of 
New York is largely dependent on the credit of its banks. 
Through the facilities which they aflTord or withhold, they 
give tone to its business, which they not only represent, 
but, to a great extent, sustain and control. How import- 
ant that their management should be right and safe ! How 
essential to the prosperity of a mercantile community, that 
the credit of its banks should continue unimpaired! 

There can be no question that the establishment of the 
New York Clearing House has added to the credit of the 
city banks, and to the permanent prosperity of the city 
itself. As this institution is now well established, its use- 
fulness admitted, and its system about to be imitated by 
the banks of other cities, an account of the mode in which 
its business is conducted may be timely and useful. 

The daily routine of business is as follows : 

At ten, A. M., each of the forty-eight associated banks 
is represented at the Clearing House by a settling clerk and 
a specie clerk, or porter. The settling clerk brings a state- 
ment, showing — 

First. The amount which has been received by the 
bank he represents, of checks upon, bills of, and checks 
and notes of, other banks redeemed by each and every bank 
belonging to the association, down to the close of business 
on the preceding day. 

Secondly. Amounts received by remittances or in 
other ways, and added to the exchanges, that morning. 

Thirdly. The united amount of the first two items, be- 
ing the total of what they bring to the Clearing House for 
exchange. 

The following is given as a specimen of the ruling or 
form of the above statement. 



APPENDIX. 



271 



Wo. 1, Settlmg Cleric's Statement of the Banh of New 
York, Oatdber 1st, 1855. 



NO. 


BANKS. 


FIRST DEBIT. 


ADDITIONS. . 


TOTAL DEBIT. 


BANKS CK. 


NO. 


2 
3 

4 


Manhattan Cp., . . . 
Merchanta' Bank, . 
Mechaniea' Bank, . 


$10,000 00 

2,000 00 
5,000 00 


$7,000 00 

500 00 


$10,000 00 

9,000 00 
5,500 00 


$6,000 00 

15,000 00 
8,764 00 


2 
3 
4 




$17,000 00 


$7,500 00 


$24,500 00 


$29,764 00 






Dr. Balance, 










$6,264 00 




_ 



He also brings a ticket, which informs the Clearing 
House of the amount sent for exchange by the bank he 
represents, and for which he receives a credit. This amount 
is shown in his statement, under the column headed "Total 
debit," and in the above example would be $24,500 00. 
This statement has a column in which the amounts to be 
received are to he entered. This column is headed " Banks 
Or." The specie clerk or porter of each bank brings with 
him a statement of the amount, which the bank lie repre- 
sents sends in against each of the other banks, made in the 
following form : 

Wo. 1, Specie Clerk's Statement of the Bank of New York, 
October 1st, 1855. 



NO. 


BANKS. 


DE. 


DR. 


EEOEIVED BT. 


NO. 


2 
3 

4 
5 


Manhattan Conipany, ; 

Merchants' Bank, 

Mechanics' Bank, 

Union Bank, 


$10,000 00 
9,000 00 
6,600 00 




C. 

B. 

8. 
G. 


2 
3 

4 
5 










$24,500 00 







The specie clerk also brings the exchanges, composed of 
checks upon and bills of the several banks, made up in 
parcels for each bank, with a slip upon the top stating the 
amount of each item of exchange ; stating also the total of 
the amount to be delivered each bank. This statement has 
a column headed " Received by " — ^the slip covering each 
exchange is in the following form, as shown by a slip of 
Bank JVo. 1, the Bank of New York, on Bamk'Wo. 2, the 
Manhattan Company : — 



272 



APPENDIX. 



No. 2, 
Manhattan Company. 


Prom No. 1, 
Bank of Ne-w York. 


Check, 


$2,500 00 
6,500 00 
1,000 00 > 




Bills, '. 




$10,000 00 



The counter of the Clearing House is an ellipse. Each 
of the forty-eight banks, which are numbered according to 
their age, has its own portion of this counter, distinctly 
marked. At ten o'clock the manager calls the clerks to 
their stations. The settling clerks arrange themselves on 
the inside of the counter — the specie clerks take the outside. 
The specie clerks so arrange their exclianges, that the first 
is for the bank next on the right — and the last for that up- 
on the left. At the manager's signal, each of these clerks 
moves toward the right, and delivers to the bank next his, 
the parcel of money which he has for it. For this he takes 
a receipt of the settling clerk, who must first make sure 
that the amount received corresponds with that named in 
the statement brought by the specie clerk. In this way, 
the specie clerks proceed till they have made the circuit of 
the counter : by which time all their exchanges have been 
delivered, and a receipt has been taken for each. The 
whole is done in five minutes. The settling clerks enter 
the exchanges on their statements to the credit of the re- 
spective banks, and then call them over with the specie 
clerks to make sure that all is right. They then ascertain 
the amount received, and the difference between that and 
the amount brought by the specie clerk of their bank to be 
exchanged. This decides whether it is debtor or creditor 
with the Clearing House. The specie clerks now go home, 
and the receipts which they carry convey to the banks thus 
early in the morning, a "knowledge of their position at the 
Clearing House for that day. The settling clerks remain, 
and each prepares a ticket, stating the amount he has re- 
ceived — the amount brought, and the balance between the 
two sums, whether for or against his bank. From these 



APPENDIX. 



273 



tickets, and those which were brought to the Clearing 
House by the settling clerks, the entries on the Clearing 
House proof are made, and, at half-past ten, the result is 
announced. 

It is plain that the aggregate amonnt of exchanges sent 
to the Clearing House, and for which each bank receives on 
the proof sheet its proportion of credit, must be the same as 
the aggregate amount returned to the banks, after making 
the exchange — although each bank thus becomes a debtor 
or creditor of the Clearing House. The total indebtedness 
thus created, of the banks to the Clearing House, exactly 
equals the indebtedness of the House to those banks which 
brought a greater amount of exchanges than they received. 
In omer words, each bank sends, to the Clearing House 
forty-seven parcels of exchange — ^being one for each of the 
other associate bankfe. For these, respectively, it gets the 
receipts of the settling clerks of their banks. With the 
total of these receipts it is credited by the Clearing House. 
It also receives one exchange from each of the other forty- 
seven banks, giving the receipt of its settling clerk therefor. 
With the total amount thus received, it is debited by the 
Clearing House. If a bank delivers a larger amount of ex- 
changes than it receives, the Clearing House becomes in- 
debted to it for the difference : or, if it be the other way, 
the Clearing House is its creditor for the balance. The 
following specimen of a proof sheet, made for five banks, 
illustrates what is stated above : — 



New York Clearing House Proof, October \st, 1855. 



NO. 


BANKS. 


BALANCES 
DDE BY 
BANKS. 


BANKS DB. 


BANKS CE. 


BALANCES 
DUE TO 
BANKS. 


1 

2 
3 
4 
S 


B'k of New York, 
Manhattan Co., . . 
Meroliants' Bank, 
Mechanics' Bank, 
Union Bank 


$5,254 00 

46,000 00 

3,111 80 


$1,129,754 00 
1,450,000 00 
2,796,000 00 
1,195,634 20 
1,039,892 88 


$1,124,500 00 
1,500,000 00 
2,750,000 00 
1,200,000 00 
1,036,781 08 


$50,000 00 

4,S65 80 




$54,365 80 


$7,611,281 08 


$7,611,281 08 


$54,365 80 



As might be expected in a process depending on the 
accuracy of nearly a hundred clerks, errors often occur. It 
seldom happens that a proof is obtained at the first trial. 



18 



2U 



APPENDIX 



To detect these errors, small check tickets, like the accom- 

panying example , are used. 

All the banks are provided with 
sets of these tickets, printed with blank 
amounts, one for each bank, and made 
up in parcels, in numerical order, as 
the banks are arranged at the Clearing 
House : each bank using one set of 
tickets per day. It has already been 
shown that the proof is based "on the 
statements of the settling clerks ; that 



No. 2, 

Manhattan Company, 

from No. 1, 

Bank of New York. 

i;io,poo 



the amounts therein stated are assumed as correct ; and that 
the credit entries are made from exchange slips. It is evi- 
dent that the statement of each settling clerk contains two 
amounts, which must also be found on the statement of every 
other bank in the association. To assure their agreement 
it is necessary that each settling clerk shall make a set of 
tickets from his statement, showing the amount according 
to it, which he has set against every other bank. After 
making out and delivering these tickets, each settling clerk 
proceeds to compare and cheek those which he has received. 
He thns reconciles his entries made from exchanges re- 
ceived, with the debits made on the statements of the banks 
from which the exchanges came. If the proof be not ar- 
rived at in this way, the difference is clearly owing to some 
error in footing. To ascertain where and what it is, the 
settling clerks are directed to interchange their statements, 
and to examine each other's footings. By this process the 
last error is detected and a proof is made. The clerks are 
then dismissed, and not till then. 

To insure dispatch and accuracy, forty-five minutes 
are allowed for getting the proof. For every error not 
found before the expiration of this time, a fine is imposed^ 
varying from one dollar to twelve dollars, and these fines 
are reported monthly to the banks whose clerks have made 
the errors. The clerks are thus rendered vigilant and at- 
tentive, and the making of the proof seldom exceeds the 
allotted period. 

Connected with the Clearing House is a deposti bank. 
At this time the Bank of America acts in such capacity for 
the association. In this bank, the other members of the 
association deposit specie in such sums as they see fit, 
receiving certificates of deposit in sums of $500, $1,000, 
$5,000, and $10,000. These certificates state that the 
Bank of America has received, and holds the same in trust, 



APPENDIX. 275 

as a special deposit, payable only to tlie order of a bank 
belonging to the association, on presentation, indorsed by 
Buch bank. TBe amount held in this way by the Bank of 
America for some time past is $6,500,000. 

The certificates alluded to are used instead of specie, in 
settling balances with the clearing house. They thus ren- 
der needless a daily and costly transportation of coin. 

At one o'clock, the debtor banks come to the clearing 
house, and pay the balances against them in these certifi- 
cates ; or if the sums be less than $500, in their own notes 
and in coin. These banks having all paid their debts and 
taken the manager's receipts therefor, the creditor banks, 
at half past one, come in, by their specie clerks, take the 
balances due them, and give their receipts for the same. 
At two, P. M. tlie settlement is completed, and the day's 
work is over. 

The results thus accomplished may be briefly enumer- 
ated as follows : 

First: The condensation for each bank of forty-eight 
balances into one, and the settlement of that balance with- 
out a movement of specie. 

Secondly: The avoidance of numerous accounts, entries, 
and postings. 

Thirdly : Great saving of porters' time, and risk in mak- 
ing exchanges and settlements from bank to bank. 

Fourthly: Relief from a vast amount of labor and an- 
noyance to which the great army of cashiers, tellers, and 
book-keepers were subjected under the old system. 

Fifthly : The liberation of the associated banks from all 
injurious dependence on each other. 

Sixthly : The absolute facility afforded by the books of 
the Clearing House, for knowing at all times the manage- 
ment and standing of every bank in the association. 

To other advantages and results, more general in their 
nature, and less direct, but not less important and benefi- 
cial, we have already alluded. The Clearing House sys- 
tem needs no higher commendation than the fact, that it 
has proved entirely satisfactory to the banks and banking 
interests of the city of New York. It has checked, and 
almost wholly prevented, those violent expansions and con- 
tractions of loans, which produce unhealthy fluctuations in 
the money market. It has enlarged the specie ba^s of the 
banks by rendering it absolutely necessary for its members 
to hold at all times such an amount in specie, or specie certifi- 
cates, as will enable them to meet promptly every demand 



2T6 APPENDIX. 

that can be made upon them. It thus makes the suspen- 
sion of specie payments very improbable. 

The system has proved no less satisfactory to the com- 
munity in general. Its value is beginning to be under- 
stood elsewhere. Boston has just adopted it. Its immense 
and manifest utility must commend it to every large city 
in the Union. Possibly, the time is not remote when a 
voluntary system of par exchanges, and redemption of 
bank issues, will exist among all the banks of the United 
States. 

The business of the iN'ew York Clearing House in ex- 
changes, averages about $20,000,000 per day. The daily 
balances amount to about $1,000,000. Vast as are these 
amounts, the exchanges are all made in five minutes ; the 
proof is obtained in less than an hour, and the balances 
between the banks are all settled between the hours of one 
and two, P. M. For two years this enormous business has 
been transacted without the error or loss of a single cent. 

The institution costs the banks about $16,000 a year ; 
an expense which is divided among them in proportion to 
their capital. It is, therefore, as cheap as it is useful. 

The Clearing House is on the second floor of No. 82 
Broadway. Its ofl&cers are, a manager, an assistant man- 
ager, and a clerk. Its accounts, though so large in amount, 
are very simple. They are mainly kept in four books. 

First : The Eeooed Book. This is a mere copy of the 
proof sheet. 

Second : The Balance Book. In this a receipt is taken 
for every balance paid to a creditor bank. 

Thvrd : The Ledger. In this all amounts entered on 
the Kecord Book are duly posted to the account of each 
bank. 

Fourth : The Monthly Statement Book. This is made 
up from the Ledger, and is a proof of it. 

The last is the most important book kept by the Clear- 
ing House. It shows the monthly amount of exchanges 
received from and delivered to each bank ; the balances 
paid and received by each ; and the monthly movements of 
each bank, whether as debtor, in excess, or creditor. By 
examining this book through a series of months, the course 
of business in any bank may be exactly known ; and from 
this a reliable opinion may be formed in regard to the man- 
agement and real position of the Bank. Accordingly, this 
book is often consulted. By reference to it, the bank offi- 
cers regulate, to a great extent, their mutual exchanges. 



APPENDIX. 277 

There are other books, such as its own accounts, and 
one for the statistics of banking. The weekly statement 
required by law of the banks, and published in the pa- 
pers every Tuesday morning, is made up in tabular form 
from this book. An account of these statements is kept 
with each bank, an account which shows its increase or 
decrease of business. From the same book at the end of 
the year, is drawn a statement of the average business of 
each bank during the year. The fluctuations in business 
in any month or week, the growth or decline of business 
with each and every bank, may be found here. 

This association is a voluntary organization, and is gov- 
erned by the following Constitution.* 

* For the preceding clear and valuaWe account of the New Torh Clear- 
ing House, the compiler is indebted to Geokqe D. Lyman, Esq., the able and 
successful Manager of the Institution. 



278 APPENDIX. 

CONSTITUTION 

OF THE 

NEW YORK CLEARING HOUSE. 

Adopted Jnue 6tli, 1854. 



§ 1. The name of this Association shall be " The JSTew 
YoEK Clearing House Association." 

§ 2. The objects of the Association shall be the effecting 
at one place of the daily exchanges between the several 
Associated Banks, and the payment at the same place of 
the balances resulting from such exchanges. But the Asso- 
ciation shall be in nowise responsible in regard to such ex- 
changes, nor in regard to the balances resulting therefrom, 
except so far as such balances shall be actually paid into 
the hands of the Manager. The responsibility of the Asso- 
ciation is strictly limited to the faithful distribution by the 
Manager among the Creditor Banks, for the time being, of 
the sums actually received by him ; and should any loss 
occur whilst the said balances are in the custody of the 
Manager, they shall be borne and paid by the Associated 
Banks, in the same proportion as the other expenses of the 
Clearing House, as hereinafter provided for. 

§ 3. The Association at present consists of the following 
members : — {Here a/re mserted the names of the Associated 
JSanlcs.) 

§ 4. Each Bank belonging to the Association shall be 
represented at all meetings thereof by one or more of its 
principal officers, and shall be entitled to one vote. 

§ 6. A general meeting of the Association shall be 
holden at the Cleaeing House, on the first Tuesday in Oc- 
tober, in each, year, at 12 o'clock M. At every annual 
meeting a Chairman shall be elected, by ballot, to preside 
at that meeting, and all subsequent meetings during the 
year. "Whenever he shall be absent, a Chairman j?to tern. 



APPENDIX. 279 

shall be appointed. At the same meeting, a Secretary shall 
also be elected by ballot. 

§ 6. Special meetings shall be called by the Clearing 
Souse Committee whenever they may deem it expedient, 
or whenever they shall be thereto requested by any seven 
of the Associated Banks. 

§ 7. At all meetings of the Association, a quorum for 
the transaction of business shall consist of a majority of 
the whole number of Associated Banks. 

§ 8. At every annual meeting, a Standing Committee 
oi Fvue Bank Officers shall be elected by the majority and 
by ballot, to be called the Clearing House Committee, whose 
duty it shall be to procure, from time to time, a suitable 
room or rooms for the Clearing House ; to provide proper 
books, stationery, furniture, fuel, and whatever else may be 
necessary for the convenient transaction of business thereat ; 
to appoint a Manager annually, and such Clerks as may be 
necessary ; to establish rules and regulations to be observed 
at the Clewring House in cases not provided for in this 
Constitution, subject to the approval of the Association; 
and generally to supervise the Clearing House affairs. 
This Committee shall have charge of ihe funds belonging 
to the Association ; shall draw on each bank for its quota 
of the expenses ; and shall also, at the first meeting of the 
Association after their election, submit detailed estimates 
of the expenditures that will be required for the Clearing 
House during the current year. 

§ 9. The salary of the Mnnager shall always be fixed by 
the Association. The salaries of the Clerks shall be fixed 
by the Clearing House Committee. The Manager shall 
give a bond, with sureties, in the sum of ten thousand dol- 
lars, and each Clerk in the sum of five thousand dollars, to 
be approved by said Committee. 

§ 10. Tlie Manager, under control of tlie Clearing House 
Committee, shall have immediate charge of all business at 
the Clearing House, so far as relates to the manner in 
which it shall be transacted ; and the Clerks of the estab- 
lishment, as well as the Settling Clerks and Porters of the 
several Associated Banks, while at the Clearing Hoy,se, shall 
be under his direction. 

§ 11. The Clea/ring House Committee shall have power 
to remove the Manager or any of the Clerks, whenever, in 
the opinion of the Committee, the interest of the Associa- 
tion shall require. 

§ 12. The horn- for making exchanges at the Clearing 



280 APPENDIX. 

Mouse shall be 10 o'clock A. M., precisely. At 1 o'clock 
P. M., the debtor banks shall pay to the Manager, at the 
Clearing House, the balances against them, either in actual 
coin, or in the certificates hereinafter mentioned, except 
fractional amounts. At 1|- o'clock P. M., the creditor 
Banks shall receive from the Manager, at the same place, 
the respective balances due to them, provided the balances 
due from the debtor Banks shall then Lave been paid. 

§ 13. Should any one of the Associated Banks fail to appear 
at the Clearing Souse at the proper hour, prepared to pay 
the balance against it, the amount of that balance shall be 
immediately furnished to the Clearing Souse by the several 
Banks exchanging at that establishment with the defaulting 
Bank, in proportion to their respective balances against 
that Bank resulting from the exchanges of the day ; and 
the Manager shall make requisitions accordingly, so that 
the general settlement may be accomplished with, as little 
delay as possible. The respective amounts so furnished the 
Clearing Mouse on account of the defaulting Bank will, of 
course, constitute claims oa the part of the several respond- 
ing Banks against that Bank ; but, as before stated, the 
Association shall in nowise be responsible therefor. 

§ 14. Errors in the exchanges, and claims arising from 
the return of checks, or from any other cause, are to be ad- 
justed directly between the banks who are parties to them, 
and not through the Clearing Mouse, the Association being 
in no way responsible in respect to. them. 

§ 15. Reclamations for errors and deficiencies in specie 
received at the Clearing Mouse, contained in bags or other 
packages, sealed and marked in conformity with any rules 
established upon that subject by the Clearing Mouse Com- 
mittee, should be made withia a reasonable time by the 
receiving Bank directly against the Bank whose mark the 
sealed bag or package bears, the Association not being re- 
sponsible for the contents of such sealed bags or other 
packages. 

§ 16. The Associated Banks shall, from time to time, 
appoint one of their own number to be a D&positary to re- 
ceive, iii special trust, such coin as any of the Associated 
Banks may choose to send to it for safe keeping. The De- 
positary shall issue certificates in exchange for such coin, 
in proper form, and for convenient amounts. Such certifi- 
cates shall be negotiable only among the Associated Banks, 
and shall be received by them in payment of balances at 
tlie Clearing Mouse. Such special deposits of coin are to 



APPENDIX. 



281 



be entirely voluntary, each Bank being left perfectly free 
to make them or not at its own discretion. The coin thus 
placed in special deposit is to be the absolute property of 
such of the Associated Banks as shall, from time to time, 
be the holders of the certificates, and is to be held by the 
Depositary subject to withdrawal, on the presentation of 
the proper certificates, at any time during banking hours. 

§ IT. New members may be admitted into the Associa- 
tion at any meeting thereof. Such new members shall pay 
an admission fee of one thousand dollars, and shall signify 
their assent to this Constitution in the same manner as the 
original members. But no new member shall be admitted 
except by a vote of three-fourths of those present. 

§ 18. ' A Standing Committee of Five Bank Officers shall 
be appointed. at every annual meeting, to whom all appli- 
cations for admission into the Association shall be referred 
for examination. 

§19. For cause deemed sufficient by the Associated 
Banks, at any meeting thereof, any Bank may be expelled 
from the Association, and debarred from all the privileges 
of the Clearing House, provided a majority of the whole 
number of Associated Banks vote in favor thereof. 

§ 20. A Standing Committee of Five Officers of BamJcs 
shall be elected at every annual meeting, who, acting in 
concurrence with the Clearing House Cormnittee, shall have 
power, in case of extreme emergency, to suspend any Bank 
trom the privileges of the Clearirhg House until the pleasure 
of the Association thereupon shall be ascertained. But no 
such suspension shall take place unless a majority, at least, 
of each of these two Committees shall be present at the or- 
dering thereof, nor unless the vote be iinanimous. In case 
of such suspension, the Clearvng House Committee shall 
forthwith call a general meeting of the Association to take 
the matter into consideration. 

§ 21. Any member of the Association may withdraw 
therefrom at pleasure, first paying its due proportion of all 
expenses incurred, and signifying its intention to withdraw, 
to the Clearing House Committee. 

§ 22. The expenses of the Cleari/ng House, not including 
the expense of printing for the several Banks (which last- 
mentioned expense shall be apportioned equally), shall be 
borne and paid by the several Banks belonging to the As- 
sociation, according to their respective capitals, as follows : 

Banks having capitals of less than $500,000, shall pay 
^100 each, annually. 



282 APPENDIX. 

Banks having capitals of less than $1,000,000, and not 
less than $500,000, shall pay $200 each, annually. 

Banks having capitals of $1,000,000 and over, shall pay 
$300 each, annually. 

And in the same proportion if more funds become 
necessary. 

§ as. This Constitution, when agreed to by the Associa- 
tion at any general meeting thereof, by a majority of votes, 
shall be submitted to the respective Boards of Directors of 
the several Banks herein named as members of the Asso- 
ciation, for their adoption. "When adopted by a majority 
of the whole number of Banks, it shall be deemed and taken 
to be in full force and operation. Adoption shall be signi- 
fied by the signature of the proper officer of the Bank to 
two copies hereof, one to be kept by the Chairman of the 
Clearing Souse Committee, and the other by the Secretary 
of the Association. A copy of the vote or resolution of the 
Board authorizing such signature shall be deposited with 
the Secretary. Such Banks as shall not adopt this Consti- 
tution within two montbs from the time it is agreed to in 
general meeting as above mentioned, shall, at the expira- 
tion of such two months, cease to be members of the Asso- 
ciation, provided the Coiistitution shall then be in opera- 
tion. 

§ 24. Amendments of this Constitution may be made at 
any meeting of the Association, by the vote of a majority 
of all the members thereof, notice of the proposed amend- 
ments having been given at a previous meeting. 



The following is a list of the banks in the city of 
New York, now belonging (November, 1855) to the Asso- 
ciation called the New York Cjibaeing House — with the 
capital, and the Clearing Souse number, of eaph bank. 



No. 


Kamps of B^ks. 


Capital. 


1. 


Bank of New York, 


. $2,000,000 


2. 


Manhattan Company, 
Merchants' Bank, 


2,050,000 


3. 


. 1,490,000 


4. 


. Mechanics' Bank, 


2,000,000 


5. 


Union Bank, 


. 1,500,000 


6. 


Bank of America, 


2,000,000 


7. 


Phoenix Bank, . 


. 1,200,000 


8. 


City Bank, . 


1,000,000 



APPENDIX. 



283 



No. Names of Banks. 

9. North Eiver Bank, 

10. Tradesmen's Bank, . 

il. Fulton Bank, 

12. Chemical Batik, 

13. Merchants' Exchange Bank, 

14. National Bank, 

15. Butchers' and Drovers' Bank, 

16. Mechanics' and Traders' Bank, 

17. Greenwich Bank, 

18. Leather Manufacturers' Bank, 

19. Seventh "Ward Bank, 

20. Bank of the State of New York, 

21. American Exchange Bank, 

22. Mechanics' Banking Association, 

23. Bank of Commerce, 

24. Bowery Bank, 

25. Broadway Bank, 

26. Ocean Bank, 

27. Mercantile Bank, 

28. Pacific Bank, 

29. Bank of the Republic, 

30. Chatham Bank, 

31. People's Bank, . 

32. Bank of North America, 

33. Hanover Bank, 

34. Irving Bank, 

35. Metropolitan Bank, 

36. Citizens' Bank, 
38. Grocers' Bank, . 

40. Nassau Bank, 

41. East Kiver Bank, 

42. Market Bank, 

43. St. Nicholas Bank, 

44. Shoe and Leather Bank, 

45. Corn Exchange Bank, 

47. Continental Bank, 

48. Bank of the Commonwealth, 

49. Oriental Bank, 

50. Marine Bank, 
62. Atlantic Bank, 



Capital. 

655,000 
600,000 
600,000 
300,000 

1,235,000 
750,000 
600,000 
200,000 
200,000 
600,000 
600,000 

2,000,000 

3,000,000 
632,000 

6,000,000 
356,650 
600,000 

1,000,000 

1,000,000 
422,700 

1,500,000 
450,000 
412,500 

1,000,000 

1,000,000 
300,000 

2,000,000 
400,000 
300,000 
600,000 
413,050 
650,000 
500,000 
600,000 
914,000 

1,600,000 
760,000 
300,000 
600,000 
400,000 



"Whole No. of Banks, 48. Capital, $47,880,900 



284 



APPENDIX. 



BANKS CHARTERED 

BY THE 

STATE OF NEW YOEK 

FEOM 1782 TO 1829, 



Teae. 

1782. 

1791. 

1792. 
1793. 
1799. 
1801. 
1803. 
1805. 
1807. 
1808. 
1810. 

1811. 

(f 

(( 

a 
<( 

1812. 

ff 

(( 
a 

1813. 
(( 

a 

ii 

1814. 
1815. 
1816. 



Names of Basks. 
Bank of Noeth Amekioa,* 



Original Capital. 
$10,000,000 



Bank .of New York, 

Bank of Alb ant, 

Bank of Coluiebia, 

Manhattan Company, 

Farmers' Bank, 

New York State Bank, 

Merchants' Bank, 

Mohawk Bank, 

Bank of Hudson, 

Mechanics' Bank, 

Bank of Newburgh, 

Bank op Trot, 

Union Bank, 

Mechanics' and Farmers' Bank, . 

Middle District Bank, 

Bank of America, . 

Citt Bank, 

New York Manufacturing Company, 

Bank of Utioa, 

Bank of Orange County, . 

Ontario Bank, 

Bank of Lansingbuegh, 

Catskill Bank, . 



Bank op Niagara, . 
Jefferson County Bank, 



1,000,000 
260,000 
160,000 

2,050,000 
300,000 
460,000 

1,250,000 
200,000 
300,000 

1,500,000 
400,000 
600,000 

1,800,000 
600,000 
500,000 

6,000,000 

2,000,000 
700,000 

1,000,000 
400,000 
500,000 
200,000 
400,000 



400,000 
400,000 



* Thia Bank was chartered by the Continental Congress in ITSl. 
never traneaoted business under its New York Charter. 



It 



APPENDIX. 



285 



Teak. 


Names of Banks. 


Oeiginai. Capital. 


1817. 


Bank of Geneva, 


400,000 


a 


Phcenix Bank, . 


. 700,000 


(C 


Bank of Attbuen, . 


400,000 


(1 


Bank of Washington and Waeeen, 


. 400,000 


(C 


Bank of Plattsbuegh, 


300,000 


1818. 


Centeal Bank, . 


. 200,000 


a 


Bank of Chenango, 


200,000 


u 


Feanklin Bank, 


500,000 


1819. 


Geeene County Bank, 


90,000 


1S9.0 












1822 


• • 




1823. 


Teadesmbn's Bank, . 


600,000 


1824. 


Fulton Bank, . 


500,000 


(( 


Chemical Bank, 


400,000 


a 


Long Island Bank, 


300,000 


a 


Bank as Eochestee, 


250,000 


1825. 


Commeeoial Bank of Albany, . 


300,000 


(( 


Dutchess County Bank, 


1.50.000 


« 


Dey Dock Bank, 


200,000 


1826. 






isaT 


. 




S.KJJJ % • 

1828. 


■ ■ • 


* 




. 





42 Banks. Aggregate Capital, $29,170,000 
{Bimng a period of ^1 years.) 



286 



APPENDIX. 



BANKS CHARTERED 

By THB 

STATE OF NEW YORK 



lAFETY FUND SYSTEM, 

FROM 1829 TO 1838. 



Yeak. 


Name of Bank. 


Okibinal Capitai- 


1829. 


National Bane, 


. $1,000,000 


u 


Canal Bank of Albany, . 


300,000 


ii 


Bank of Genesseb, 


100,000 


u 


Bank of Ithaca, 


200,000 


u 


LooKFOET Bank, 


100,000 


« 


Meechants' and Mechanics' Bank, 


300,000 


(f 


Meeohants' Exchange Bank, 


. 750,000 


l( 


Bank of Moneoe, . 


300,000 


<f 


Ogdensbuegh Bank, 


. 100,000 


(f 


Wayne County Bank, 


100,000 


(( 


Bank op 'White-Hall, . 

BANKS EE-CHAETEEED. 


. 100,000 


1829. 


Bank of Albany, 


• 260,000 


a 


Bank of Aubuen, 


400,000 


ii 


Bank of Catskill, . 


400,000 


li 


Centeal Bank, 


200,000 


(( 


Bank of Chenango, 


200,000 


li 


Faemees' Bank, 


. 250,000 


ci 


Bank of Geneva, . 


400,000 


a 


Jkffeeson County Bank, 


. 400,000 


i: 


Mechanics' and Faemees' Bank, 


600,000 


a 


Middle Disteiot Bank, 


500,000 


u 


Mohawk Bank, 


200,000 


(1 


Bank of Newbuegh, 


. 400,000 





APPENDIX. 


287 


Ykab. 


Kames op Banks. 


Okiginal Capital. 


1829. 


New Toek State Bank, 


460,000 


(( 


Ontakto Bank, 


500,000 


a 


Bank of Trot, 


500,000 


u 


Bank of Utioa, 


. 1,000,000 



BANEB CHAKTEEED. 



1830. 


BUTCHEES' AND DeOVEES' BaNK, 


300,000 


(( 


Geeenwioh Bank, 


200,000 


u 


Hudson Ritee Bank, 


100,000 


(f 


Livingston County Bank, 


. 100,000 


(( 


Mechanics' and Teadees' Bank, 


200,000 


u 


Onondaga County Bank, 


150,000 


(( 


Otsego County Bank, 


100,000 


a 


Bank of Poughkeepsie, 


100,000 


(i 


Saeato'ga County Bank, 


100,000 


1831. 


Become County Bank, 


100,000 


ii 


Bank of Buffaxo, . 


200,000 


(( 


Chatauque County Bank, 


100,000 


a 


Madison County Bank, 


100,000 


a 


Montgomeey County Bank, 


100,000 


<c 


Oswego County Bane, 


150,000 


a 


Tannees' Bank, 


. 100,000 


u 


Ulstee County Bank, 


100,000 


a 


Yates County Bank, . 


. 100,000 



BAISTKS RE-CHAETEEED. 



1831. 


Bank OF Ameeica, 


. 2,000,000 




City Bank, . . 


2,000,000 




Mechanics' Bank, 


. 2,000,000 




Meechants' Bank, 


1,490,000 




Bank of New Toek, . 


. 1,000,000 




Teadesmen's Bank, 


600,000 




Union Bank, . 


. 1,800,U00 




BANKS CHAETEEED. 


• 


1832. 


Beooklyn Bank, 


. 200,000 


a 


Essex County Bank, 


100,000 


li 


Leathee Manufactueees' Bank, 


600.000 


(( 


Bank of Eome, 


100,000 



288 APPENDIX 

Teae. Kames of Banks. Original Capital. 

1832. Bank of Salina, . . . 150,000 

" ScHKNECTADT BaNK, . . 150,000 

" Stettben Countt Bank, . . 150,000 

BANKS KE-CHAETERED. 



1833. 


Bank of Lansingbuegh, 


200,000 


(( 


Bank of Oeange County, 

BANKS CHAETEEED. 


400,000 


1833. 


Cayuga County Bank, 


250,000 


u 


Chemung Canal Bank, 


200,000 


a 


Heekimke County Bank, . 


200,000 


<( 


Lewis County Bank, . 


100,000 


(( 


Seneca County Bank, 


200,000 


(E 


Seventh Waed Bank, . 


500,000 


(C 


Teoy City Bank, 


300,000 


(( 


Wkstchestee County Bank, 


200,000 


1834. 


Albany City Bank, 


500,000 


a 


COMMEEOIAL BaNK OP BuJb'i'ALO, 


400,000 


ft 


COMMEECIAL BanK OF NeW ToeK, . 


500,000 


u 


Faemees' and Manufactueees' Bank, 


300,000 


i( 


Highland Bank, 


200,000 


« 


Lafayette Bank of the City ofN. Yoek, 


, 500,000 


(C 


Bank of Oeleans, . 


200,000 


a 


Sacket's Haeboe Bank, 


200,000 


1835. 










1836. 


Atlantic Bank, 


500,000 


(( 


CiTi: Bank of Buffalo, 


400,000 


(( 


Clinton County Bank, 


200,000 


u 


COMMEECIAL BaNK OF OsWEGO, 


250,000 


(( 


Kingston Bank, 


200,000 


a 


Bank of Lyons, 


200,000 


i< 


Oneida Bank, .... 


400,000 


ti 


Bank of Owego, 


200,000 


a 


Eoohestee City Bank, . 


400,000 


(( 


Bank of the State of New Yoek, 


2,000,000 


(( 


Tompkins County Bank, 


250,000 


(( 


Wateevltet Bank, . 


250,000 


1837. 











87 Banks. Aggregate Capital, $35,360,000 

{Dv/rmg a period of 9 yea/rs^ 



APPENDIX 



289 



BANKING CORPORATIONS, 

ORGANIZED UNDER THK 

GENERAL BANK ACT OF 1838, 



CITY AND STATE OF NEW TOEK. 



Banking Coeporations, undee the Geneeal 

Law, in tue City of New Yoek. 

(August 2d, 1856.) 



-Ambrican Exchange Bank, 

Atlantic Bank, 

Bank of America, 

Bank or Commerce, 

Bank of the Commonwealth, 

Bank of New York, 

Bank of North America, . 

Bank of the Republic, . 

Bowery Bank, . 

Broadway Bank, . 

Bull's Head Bank, 

Butchers' and Drovers' Bank, 

Chatham Bank, . 

Chemical Bank, 

Citizens' Bank, . 

City Bank, 

Continental Bank, . 

Corn Exchange Bank, . 

East River Ban^, 

Fulton Bank, . 

Grocers' Bank, . 

Hanover Bank, 

Irving Bane, 

Island City Bank, . 

Marine Bank, . 

19 



! Capitai. 



$3,000,000 

400,000 

2,000,000 

5,000,000 

750,000 

2,000,000 

1,000,000 

1,500,000 

356,650 

600,000 

173,300 

600,000 

450,000 

300,000 

400,000 

1,000,000 

1,500,000 

914,000 

413,050 

600,000 

300,000 

1,000,000 

300,000 

299,200 

600,000 



Counteesiqn'b 
Notes in 

ClEOULATION, 

Aug. 2d, 1856. 



1316,001 
94,554 

2,165 

, 82,161 

138,506 

87,794 

105,268 

163,696 

209,808 

95,799 

54,926 

97,605 

273,300 

144,091 

74,033 

94,405 

92,654 

137,395 

83,744 

110,717 

105,944 

79,496 

94,074 



290 



APPENDIX. 



Banking Coepoeations, under the Geneeal 




Counteesiqn'd 


Law, in the City of New Toek. 


Capital. 


Notes in 


(August 2d, 1855.) 




ClKCULATION, 

Aug. 2d, 1856. 


Market Bank, . . - . 


$650,000 


$113,960 


Mechanics' Bank, .... 


2,000,000 


411,103 


Mechanics' Banking Association, . , 


632,000 


184,'763 


Mercantile Bank, .... 


1,000,000 


84,290 


Merchants' Exchange Bank, . 


1,235,000 


118,178 


Metropolitan Bank, .... 


2,000,000 


101,377 


Nassau Bank, .... 


500,000 


117,365 


New York Exchange Bank, 


130,000 


114,896 


North River Bank, 


655,000 


170,008 


Ocean Bank, 


1,000,000 


107,104 


Oriental Bank, .... 


300,000 


93,477 


Pacific Bank, 


422,700 


110,923 


Peoples' Bank, .... 


412,500 


119,481 


Phenix Bank, 


1,200,000 


92,267 


Saint Nicholas Bank, . 


500,000 


91,916 


Shoe and Leather Bank, . 


- 600,000 


106,852 


Tradesmbns' Bank, .... 


600,000 


241,365 


Union Bank, 


1,500,000 


15,000 




$40,693,400 


$5,132,461 



Banking Coepokations, under the General 

Law, in the State of New York. 

(August 2d, 1855.) 



Ageicultural Bank, 
Albany Exchange Bank 
Auburn City Bank, 
Ballston Spa Bank, . 
Bank of Albany, . 
Bank of Albion, 
Bank of Attica, 
Bank of Auburn, 
Bank of Binghamton, 
Bank of the Capitol, 
Bank of Central New York, 
Bank of Chemung, 
Bank of Corning, . 



Capital. 



Counteesign'd 

Notes in 
Circulation, 
Aug. 2d, 1855. 



$125,000 
311,100 
200,000 
125,000 
360,000 
100,000 
160,000 
200,000 
200,000 
350,000 
110,200 
100,000 
104,500 



$94,147 
66,111 

103,259 
77,806 

106,621 
95,990 
82,097 

163,542 
90,163 
84,561 
92,651 
42.609 



APPENDIX 



291 



Bankinq Coepoeations, under the Geneeai 




Counteesign'd 


Law, in the State of New Yoke. 


Capital. 


Notes in 


(August 2d, 1855.) 




ClKOULATION, 

Aug. 2d, 1856. 


Bank op Coopbrstown, 


$200,000 


$144,862 


Bank of Coxsackie, 


120,000 


84,266 


Bank of Danbvillb, .... 


150,250 


76,559 


Bank of Fayettbvillb, . 


113,900 


72,085 


Bank of Fishktll, .... 


150,000 


83,524 


Bank of Fort Edward, . 


128,600 


87,734 


Bank of Genesbb, .... 


100,000 


38,474 


Bank of Geneva, .... 


205,000 


133,275 


Bank of Kinderhook, 


200,000 


70,286 


Bank of Lowville, 


50,000 


99,901 


Bank op Malone, .... 


100,000 


87,H18 


Bank op Newark, .... 


100,000 


85,349 


Bank of Nbwburgh, .... 


300,000 


85,203 


Bank op Pawling, .... 


176,000 


104,796 


Bank of Port Jervis, 


120,000 


97,597 


Bank op Rhinebbck, 


125,000 


80,756 


Bank of Eondout, .... 


100,000 


85,539 


Bank of Salem, .... 


110,000 


9,2,301 


Bank of Saratoga Springs, 


100,000 


80,068 


Bank of Silver Creek, . 


90,060 


87,5-39 


Bank op Sing Sing, .... 


140,000 


76,321 


Bank op Syracuse, .... 


200,000 


110,415 


Bank op Trot, 


440,000 




Bank op Ulster, .... 


100,000 


71,242 


Bank of Utica, 


600,000 


68,956 


Bank of Vernon, .... 


100,000 


58,224 


Bank of Watertown, 


47,779 


35,335 


Bank of Waterville, 


120,000 


114,289 


Bank of West Troy, .... 


250,000 


67,968 


Bank of Whitkstown, . 


120,000 


48,679 


Bank of Yonkkrs, .... 


150,000 


58,029 


Black Rivbr Bank, 


150,000 


118,470 


Broome County Bank, 


100,000 


96,242 


Buffalo City Bank, 


204,800 


100,029 


Camden Bank, 


120,000 


18,898 


Canal Bank of Lockport, 


109,050 


55,403 


Catskill Bank, 


110,007 


8,059 


Central Bank of Brooklyn, . 


200,000 


93,974 


Central Bank op Cherry Valley, 


200,000 


17,120 


Central Bank of Troy, . 


300,000 


95,931 


Chester Bank, 


100,400 


71,524 


Chittenango Bank, 


110,000 


80,826 


Citizens' Bank, Fulton, 


125,000 


93,186 



292 



APPENDIX. 



Banking Corporations, under the General 

Law, in the State of New Tore. 

(August 2d, 1865.) 



Capital. 



Couhtehsign'd 
Notes in' 

CntOULATION, 

Aug. 2d, 1855. 



City Bank of Brooklyn, 
City Bank of Oswkgo, 
Commercial Bank of Albany, 
Commercial Bank of Glen's Falls. 
Commercial Bank of Rochester, 
Commercial Bank of Troy, 
Commercial Bank of Whitehall, 
Grouse Bank, .... 
Cuyler's Bank, 
Delaware Bank, 
Eagle Bank, .... 
Elmira Bank, .... 
Exchange Bank of Genesee, . 
Exchange Bank at Lockport, . 
Fallkill Bank, 

Farmers' Bank of Amsterdam, . 
Farmers' Bank of Hudson, 
Farmers' Bank of Lansingburgh, 
Farmers' Bank of Saratoga County, 
Farmrrs' Bank, Teoy, 
Farmers' and Citizens' Bank of Long 

Island, .... 
Farmers' and Drovers' Bank at Som- 

ERS, ..... 

Farmers' and Mechanics' Bank of 

Genesee, .... 
Farmers' and Mechanics' Bank of 
, Rochester, .... 
Fort Plain Bank, . 
Fort Sianwix Bank, . 
Frankfort Bank, . 
Frontier Bank, .... 
Fulton County Bank, 
Genesee County Bank, 
Genesee River Bank, 
Genesee Valley Bank, 
Glen's Falls Bank, 
Goshen Bank, .... 
Hamilton Bank, 
HoLLisTisR Bank of Buffalo, 
Huguenot Bank of New Paltz, 
Hungerford's Bank, . 
Ilion Bank, . . 



1300,000 
209,000 
400,000 
136,400 
330,000 
300,000 
108,200 
110,000 
100,000 
150,000 
200,000 
200,000 
100,000 
150,000 
150,000 
11'7,500 
300,000 
150,200 
200,000 
350,000 

200,000 

111,150 

100,000 

100,000 

150,000 

150,000 

105,000 

100,000 

160,000 

200,000 

130,000 

140,100 

112,000 

110,000 

110,000 

200,000 

125,00 

125,000 

100,000 



$83,225 
97,015 

182,803 
97,958 

261,206 

150,217 
72,796 
68,781 

101,661 
90,530 

145,686 

115,990 
66,273 
95,805 
74i049 
93,089 

134,621 
82,813 

106,899 
51,500 

82,716 

46,503 

76,490 

100,500 

84,227 

149,205 

89,264 

83,756 

90,533 

106,667 

102,738 

109,086 

119,041 

50,121 

106,538 

98,862 

85,056 

86,386 

100,069 



APPENDIX 



293 



ANKiNG Corporations, tinder the General 




Countersign'd 


Law, in the State of New York. 


Capital. 


Notes in 


(August 2d, 1855.) 




Circulation, 
Aug. 2d, 185S. 


TERNATIONAL BANK 


1400,000 


127,526 


FFBRSON County Bank, 


200,000 


18,700 


DSON Bank, 


122,000 


78,106 


NG Island Bank, 


400,000 


202,725 


THER Wright's Bank, 


200,000 


100,050 


kNDFACTURKR's BaNK, TrOY, . 


200,000 


45,647 


iRKET Bank of Troy, 


293,350 


96,818 


i.RiNE Bank of Buffalo, 


300,000 


125,964 


scHANios' Bank of Brooklyn, 


200,000 


121,731 


schanics' Bank of Syracuse, 


140,000 


76,793 


scHANics' Bank of Williamsburgh, 


250,000 


76,970 


schanics' and Farmers' Bank of 






Albany, 


350,000 


47,025 


srchants' Bank of Albany, 


250,000 


101,616 


SRCHANTs' Bank in Poughkeepsie, . 


150,000 


94,685 


SRCHANTs' Bank in Syracuse, 


160,000 


106,796 


IRCHANTS' AND FaRMERS' BaNK, ItHA- 






CA, 


70,000 


64,331 


erchants' and Mechanics' Bank, 






Xroy 


SCO nnn 




iddletown Bank, .... 


125,000 


79,970 


ohawk Bank op Schenectady, 


125,(100 


33,997 


ohawk Valley Bank, 


150,000 


93,211 


UTUAL Bank of Troy, . 


199,000 


72,938 


EW York and Erie Bank, 


200,000 


84,291 


Ew York State Bank, . 


300,000 


26,208 


rAGARA River Bank, 


104,000 


99,419 


liver Lee <fe Co.'s Bank, 


170,000 


84,002 


SEIDA Central Bank, 


146,800 


111,205 


seida County Bank, 


126,000 


55,697 


jBiDA Valley Bank, 


105,000 


66,868 


^ONDAGA Bane, .... 


115,000 


88,061 


iwegatchib Bank, .... 


112,223 


56,793 


:sEGO County Bank, . 


200,000 


47,079 


NE Plains Bank, .... 


100,000 


76,253 


)WELL Bank, .... 


176,000 


201,424 


iLASKi Bank, 


100,000 


97,169 


iTNAM County Bank, . 


104,430 


35.922 


jassaick Bank, .... 


300,000 


84,152 


3NSSELAER CoUNTY BaNK, 


200,000 


82,487 


)CHESTER Bank, .... 


100,000 


188,713 


)ME Exchange Bank, . 


100,000 


70,020 


LT Springs Bank, .... 


200,000 


92,251 



294 



APPENDIX. 



Banking Coepoeations, under the General 

Law, in the State of New York. 

(August 2i>, 18S5.) 


Capital. 


Countebsign'd 

Notes ik 

Circulation, 

Aug. 2d, 1865. 


Speaker Bank, .... 
State Bank of Troy, .... 
State of New York Bank, 
Susquehanna Valley Bank, 
Syracuse City Bank, 
Union Bank of Albany, ; 
Union Bank of Kinderhook, . 
Union Bank of Eochester, 
Union Bank of Sullivan County, . 
Union Bank of Troy, 
Union Bank op Watertown, . 
Utica City Bank, .... 
Washington Cqunty Bank, . 
Watertown Bank and Loan Company, 
West Winfield Bank, . 
Weedsport Bank, .... 
White's Bank of Buffalo, 

WiLLIAMSBURGH CiTY BaNK, 


$100,000 
250,000 
125,000 
100,000 
250,000 
250,000 
182,000 
500,000 
150,000 
300,000 
180,400 
200,000 
150,075 
71,605 
100,000 
100,000 
200,000 
333,300 


$80,064 

110,184 

93,296 

43,545 

104,159 

93,007 

85,891 

255,066 

94,474 

83,807 

94,540 

92,781 

64,822 

56,921 

97,722 

91,091 

109,180 

114,159 


* 


126,644,379 


$13,553,696 



Aggregate of Capital invested in Banking Corporations, 
oi'ganized under the Greneral Bank Act, in the City 
of New York, and existing August 2d, 1855, . $40,693,400 

Aggregate of Capital invested in Banking Corporations, 
organized under the General Bank Act, in the State 

• of New York, located out of the City of New York, 
and existing August 2d, 1855, .... 26,644,379 



196 Banks. Aggregate Capital $67,337,779 

Aggregate of Countersigned Notes in circulation Au- 
gust 2d, 1 855 : — 
New York City Banks, ..... $5,132,461 
New York Country Banks, 13,553,696 

Countersigned Notes, . . . $18,686,157 



APPENDIX. 



295 



STATEMENT, 



From the Annual Beport, Jcmucury, 1855, of the Stjpeein- 
TENDENT of the Banhmg De;pwrtment, of the State of 
New York — showing the capitals of the futy-foue then 
emsting Special Chaetee Banks, — the locality of 
eac\ — and the years when thei/r several ohaetees will 
esopire. 



NAME OF BANK. 



LOOALIIT. 


CAPITAL, 


Albany, ...... 

Brooklyn, 


$500,000 


600,000 


Albany, 


240,000 


Norwich 


120,000 


Lansingburgli, 


120,000 


Goshen, 


105,660 


Albion 


200,000 


Owego, 


200,000 


Poughkeepsie,. 


100,000 


Kome, 


100,000 


Salina 


150,000 


New York, . . . 


2,000,000 


Whitehall, ... 


100,000 


Brooklyn, .... 


150,000 


Bingham ton,.. 


100,000 


Auburn, 


250,000 


Cherry Valley, 


120,000 


Jamestown,. . . 


100,000 


Elmira, 


200,000 


Keeseville, . . . 


100,000 


Poughkeepsie, 


300,000 


New York, . . . 


200,000 


Little Falls,... 


200,000 


Newburgh, . . . 


200,000 


Hudson 


150,000 


Kingston, 


200,000 


New York, . . . 


600,000 


Martinsburgh, . 


100,000 


Geneseo 


100,000 


CazenoTia, 


100,000 


New York, . . . 


2,050,000 


New York, . . . 


1,440,000 


New York, . . . 


200,000 


New York, . . . 


1,490,000 



WILL EXPIRE. 



Albany City Bank, 

Atlantic Bank 

Bank of Albany, 

Bank of Chenango, 

Bank of Lansingburgh, 

Bank of Orange County, 

Bank of Orleans 

Bank of Owego, , 

Bank of Poughkeepsie, , 

Bank of Rome, 

Bank of Salina, 

Bank of the State of New York, . . 

Bank of Whitehall, 

Brooklyn Bank 

Broome County Bank, 

Cayuga County Bank, 

Central Bank, 

Ohautanque County Bank , 

Chemung Canal Bank, , 

Essex County Bank, 

Farmers' and Manufacturers' Bank 

of Poughkeepsie, , 

Greenwich Bank, 

Herkimer County Bank, 

Highland Bank, 

Hudson River Bank, 

Kingston Bank 

Leather Manufacturer's Bank, . . 

Lewis County Bank 

Livingston County Bank, 

Madison County Bank, , 

Manhattan Company, , 



Mechanics' Bank 

Mechanics' and "Traders' Bank,, 
Merchants' Bank 



1864 
1866 
1865 
1856 
1855 
1862 
1864 
1866 
1858 
1862 
1862 
1866 
1859 
1860 
1856 
1863 
1865 
1860 
1863 
1862 

1864 
1865 
1863 
1864 
1855 
1866 
1862 
1863 
1855 
1858 
Charter 
perpetual. 
1865 
1857 
1857 



296 



APPENDIX. 



NAME OF BANS. 



CHABTEB 
WILL EXPIEE. 



Montgomery County Bank, Johnstown, . . 

National Bank New York, . . 

New York Dry Dock Company, . . New York, . . 

Ogdensburgh Bank Ogdeneburgh, 

Oneida Bank, Utioa, 

Ontario Bank,; Canandaigua, 

Ontario Branoh Bank, Utica 

Rochester City Bank, Rochester, , 

Sackett's Harbor Bank, Buffalo, . . , 

Saratoga County Bank, Waterford, 

Schenectady Bank, Schenectady, 

Seneca County Bank, Waterloo, . 

Seventh Ward Bank, New York, 

Steuben County Bank, Bath 

Tanner's Bank Catskill, . . . 

Tompkins County Bank, Ithaea 

Tradesmens' Bank, New York, 

Troy City Bank, Troy, 

Ulster County Bank, Kingston, . . 

"Westchester County Bank, Peekskill, . , 

Yates County Bank Penn Yan, . 



$100,000 
750,000 
200,000 

100,000 
400,000 
200,000 
300,000 
400,000 
200,000 
100,000 
160,000 
200,000 
600,000 
150,000 
100,000 
260,000 
400,000 
300,000 
100,000 
200,000 
100,000 



1S51 
1857 
Charter 
perpetual, 
1859 
1866 
1856 
1866 
1866 
1866 
1857 
1862 
1863 
1863 
1862 
1860 
1866 
1855 
1863 
1861 
1863 
1869 



$18,041,060 



APPENDIX. 297 

DiaEST 

OP THE 

LEADING DECISIONS OF THE COUKTS 

OF THE 

STATE OF NEW TOEK, 

EELATING TO THE 

GENERAL BANKING LAW OF 1838, 

AND THE 

POWMS OF BANKING CORPORATIONS OEGANIZED UNDER IT. 



Thomas t. Dakin. 

(22 Wendell, 9-112.) 

In Octobee, 1839, the Supreme Court lield, in this case,' — Assooia- 
that associations formed under the General Banking Law, thTgeneraf 
are corporations, — and a majority of the court held that ti^QpZmiM^ 
" Act to authorize the business of banking " is a valid and 
constitutional law, on the assumption that it received the 
assent of two-thirds of the members elected to each branch 
of the Legislature, — and that it would be presumed to have 
heen thus passed, until the fact was denied by plea; the 
court refused to pass on this question on a demurrer to a 
declaration by an association in a suit for the recovery of 
a debt. (77)' 



_ ('7'7) By the Constitution of the State of New Yort, of 1821, it -was or- 
dained as follows : 

Section IX. The assent of two- thirds of the members elected to each 
branch of the legislature, shall be requisite to every bill appropriating the 
I)ublic moneys or property for local or private purposes; or creating, con- 
tinuing, altering, or renewing any body politic or corporate. 

, The 2d section of the 12th Article of the Constitution of Michigan, de- 
clares, that "the legislature shall pass no act of incorporation, unless with 
the assent of at least two-thirds of each House." The legislature of that 
Stat% by a majority vote, passed a General Banking Law, similar, in many 
respects, to the New York General Bank Act. The Supreme Court of Mich- 



298 APPENDIX 

IN THE COURT OP ERRORS. 



"Waenee v. Beers, & Bolaitdek v. Stevens. 

{23 Wendell, 103-19S).) 

b^kiflaw' ^ Apeil, 1840, the Court foe the Coeeection of Ee- 
WM oommu- RORS held, in these cases, — (1.) That the law entitled "An 
tu>naUypaB8-^Q^ to authoHze the business of banking," passed April 
18th, 1838, is valid and constitutionally passed, although it 
may not have received the assent of two-thirds of the mem- 
bers elected to each branch of the Legislature, and held, — 
(2.) That the associations organized in conformity with the 
ABsocia- provisions of the act entitled " An Act to Authorize the 
tions are not busiucss of banking," are not bodies politic or corporate 
wS''th'™ within the spirit and meaning of the Constitution, — and 
Seantag*of ^^^^ Court reversed the judgments of the Supreme Court 
the oonsti'"- in thcse cases ; the reasons of the Supreme Court for these 
■ judgments being the same as in Thom,as v. Dahin, ante. 



Talmage v. Pell. 
(9 Podge, Ch. B., 410.) 

Asaocia- In Maech, 1840, the Chancellor held, that associations 

ttTgOTerai Under the General Law of 1838, are in fact corporations, 
^"m-aums' ^"^^ ^^^* ^^^*® brought by them, in the name of their Presi- 
dent, may be continued in the name of the Eeceiver, under 
the special order of the Court. 



igan declared bo mucli of that la-w as authorized the organization of bank- 
ing associations or eorporationa under it, to he invalid. Green v. Groves 
(1 Doug., 351). See also Nesmith v. Shelden (4 McLean, 375). 

It has been held, that a body will he taken to be a corporation -when it 
is constituted by an act of parliament in such a way, or for such purposes, 
as show that the meaning of the legislature was, that the body should have 
a perpetual duration, although no express words are used constituting it a 
corporation. This is called a corporation by implication. Grant on Corpo- 
rations, London ed., 1850, p. 8. Note (o), p. 8 ; Note (b), p. 6, and cases 
there cited. * 



APPENDIX. 



299 



Pakmlt v. Tenth "Waed Bank. 

(3 E&w. Oh. B., 395.) 

In Mat, 1840, Vice Chancellor McOoun held, that an 
association nnder the General Banking Law can only he 
proceeded against and dissolved/or the causes assigned in 
the ^Ith section of the General Bank Act of 1838. See 
§ 27 and Note 45,jfi. 104, ante. 



Delaiteld v. Kinnet. 

(24 Wendell, 345-350.) 

In Octobee, 1840, the Supreme Court held in this case, ^how suits 
on a demurrer to a declaration, that a suit against an asso- Sought, &o. 
ciation, under the General Banking Law, may be brought 
against it, either in the name of the association, or in that 
name, with the addition of the name of the President 
thereof, but that the contract must be stated as having been 
made by or with the bank, using the name by which it ac- 
quires rights of action or contracts liabilities, or the decla- 
ration will be bad : And that it is not necessary to allege 
in the declaration, that notes or bills issued, &c., were signed 
by the President or Vice President and Cashier, but that 
it is sufficient to allege in general terms that the association 
made the contract. 



Ely t. Speague. 

(1 Clarke Ch. R., 351.) 

In Octobee, 1840, Vice Chancellor Whittlesey held, that a share- 
a person who becomes a subscriber to an associated bank, h^'brad'ml 
under the General Law, and pays for his stock by a bond f^^ 
and mortgage, stands in two capacities towards the bank: stands m two 
one as debtor upon his bond and mortgage, and the other wOTdfthl*"' 
as shareholder, by reason of his stock ; that a shareholder '>™^- 
cannot refuse to pay his interest upon his bond and niort- 



300. 



APPENDIX. 



gage (given for stock) because the directors refuse to de- 
clare a dividend of the interest and profits, neither will the 
collection of such interest be restrained until the directors 
make a dividend. 



Saffoed v. "Wtokoff. 

(1 Bill, 11-17.) 

A«6ooia- In Januaet, 1841, the Supreme Court held in this case — 

powto Is"-" that associations under the Oreneral SdnMng Law Lave no 
wlp"Tr''ex- 3'iit^ority to make bills of exchange, or to issite any nego- 
ceptMiMrfer- tiable paper, save under the sanction of the comptroller, 
nsnednoiea. ^^^ j^^ jj^^ iorcQ. prescribed by statute ; that no action can 
be maintained against the bank or others upon paper so 
illegally issued, this appearing on its face ; that the inten- 
tion of an act must be judged by its necessary consequen- 
ces, and where these are directly pernicious, the intent to 
work mischief becomes a conclusion of law. 

The action in this case was a joint action against the 
drawer and endorser of a bill of exchange for $3,000, dated 
August 15th, 1839, payable to the order of Revhen^D. 
Dodge, thirty days after date. See form of post-bill in this 
case, p. 118, ante. The judgment of the Supreme Cpurtin 
this case was reversed by the Coiwt of Errors (4 Hill, 442). 
See Note 30,^. 85 ante: and Bank of OhiUcothe v. Bodge 
(8 Barb. S. C. E., 233). (78) 



CFS) Mr. Jdsxioe Cot^en, in January, 1841, in delivering the opinion of the 
Supreme Court in the ease of Suffordy. Wyckoff (1 Hill, 11) said, — "that 
the action of the banks," organized under the General Banting Law of this 
State, " is very much limited by the statute, especially with regard to the 
issuing of negotiable paper. One great object of the statute was, to guar- 
anty the redemption Of all such paper, by the assignment of stocks or mort- 
gages of real estate to the Comptroller, without whose consent it cannot issue; 
and when issued with that consent, it must bear a certain form." « * » 
* * " Once allow an issue of negotiable paper independently of the State 
agents, and they will be no longer appealed to. Thus, a security, which it 
is difficult to preserve, under the most careful supervision, would be entirely - 
thrown away ; and the restraint upon excessive issues, so clearly intended by 
the Legislature, would be removed." * * * " An adjudication that this 
bill binds the bank, would be a direct pteoedent for its issue of bills paya- 
ble to bearer. It could reach the same thing practically, by drawing bills 
or notes payable-to its cashier or other instrument, to be endorsed by him 
in blank; and then, even if a distinction could be raised between these, and 
bills or notes payable to bearer, of what use all the precautions of the statute I 



APPENDIX. 301 

Its funds, forms and penalties, would be subjects of derision, and the direct 
consequence, a circulating medium of the very worst character— a jjosi-«o(e 
system without the semblance of security." — (1 Hill, 11, 14, 15.) 

Mr. Justice Co wen, in January, 1842, in Smith v. Strong (2 Hill, 241, 
24S, 244), said — " I am of opinion, that negotiable paper, in whatever form, 
issued by institutions under the General Banking Law, except under the 
sanction of the Comptroller, is a fraud upon the statute by which they are 
created, and upon the public for whose benefit they were restricted to cir- 
culating paper secured by stocks and mortgages. This we held in Safford 
V. Wyckof (1 Hill Rep., 11). It is now said we were mistaken in supposing 
that the original statute meant to restrict the issue of any negotiable paper, 
except ordinary bank bills or notes sent out to cii'culate as money. I then 
thought this argument answered by the fact, that iills of exchange may be 
used as a circulating medium ; and I insisted that the statute should not be 
defrauded by a mere change in form of the paper issue." » * * * " jt 
is true, that the drawer of the bill in question, does not, on it^ face, stand 
primarily liable as the bank would do if it had made a note — and in this 
respect, the bill is not the same as a bank bill issued by the drawer. Yet, 
by issuing it without funds in the hands of the drawee, or by adding a waiver 
of a demand and notice, the bill would have been, in effect, precisely the 
same when endorsed in blank by the payee. The bank might so have shaped 
the bill as to become the acceptor, and issued it in that form. Even with- 
out any such device, bills of exchange, especially those payable at a future 
day, answer the purpose of a circulating medium to a considerable extent; 
while, with those devices (and they can always be superadded, and be made 
matter of general notoriety) the bank may become, and be universally con- 
sidered primarily liable as upon its legal paper." — 2 Hill, 243, 244. 

In 1849, in Leavitt v. Palmer (3 Comstoek, 19, 33), Mr. Justice Bkonsom 
said, — that " negotiable promissory notes and bills of exchange, payable at 
a future day, when issued by a bank in good credit, may perform, to a great 
extent, the office of a circulating medium. This has never been doubted by 
those who have considered the subject. * * * * Indeed, the fact that 
such paper may enter into the currency of the country, is matter of history. 
Witness the post-notes of the late Bank of the United States, and the nego- 
tiable notes and bills of some of our own banks, which followed, though on 
a more humble scale, both the frauds and the bankruptcy of the national in- 
stitution. The issuing of such paper belongs to mercantile and commercial 
transactions, and not to the business of banking. Experience has shown that 
the banks which engage in such enterprises, are rotten, and sooner or later 
will end in defrauding the community." — 3 Comstoek, 33. 

Amount of Bills of Exchange in Circulation in Great Britain. 

Leone Levi, in his Manual of Mercantile Law, speaking of the immense im- 
portance bills of exchange have acquired as a representative of money, says, 

"An attempt has been made to ascertain the magnitude and fluctuations of 
the amount of bills of exchange, inland and foreign, in circulation atone time 
in Great Britain, during the period 1828-184'?, both inclusive; and it was, 
shown that the total amount of bills, inland and foreign, amounted to an 
average mm of £110,018,000. The enormous increase of, commerce since 
then, must have proportionally increased the amount of bills in circulation, 
and that they may be assumed to reach at present (1854), £160,000,000 
sterling." — Levi on Mercantile Law, 232. 

Raising Monet by Circulation, — ok Drawing and Ee-drawing. 

Adam Smith, in his Wealth of Nations (Edinburgh cd., 1846, pp. 135, 
136), published near the close of the eighteenth century, thus describes the 



303 APPENDIX. 

mode of raising money by the circulation of fictitious bills of exchange, pay- 
able on time; — "This expedient was no other than the 'well-bnowu shift of 
drawing and re-drawing — the shift, to which unfortunate traders have some- 
times recourse, when they are upon the brink of baDkruptoy." » * * » 
» » » "The trader A, in Edinburgh, we shall suppose, draws a bill 
upon B, in London, payable two months after date. In reality B, in 
London, owet nothing to A, in Edinburgh; but he agrees to accept A's bill 
upon condition, that before the term of payment, he (B) shall re-draw upon 
A, in Edinburgh, for the same sum, together with the interest and a com- 
mission, — another bill payable likewise two months after date. B, accord- 
ingly, before the expiration of the first two months, re-draws this bill upon 
A, in Edinburgh, who again, before the expiration of the second two months, 
draws a second bill upon B, in London, payable likewise two months after 
date ; and before the expiration of the third two months, B, in London, re- 
draws upon A, in Edinburgh, another bill, payable also two, months after 
date." 

"This practice has sometimes gone on not only for several months, but 
for several years together, the bill always returning upon A, in Edinburgh, 
with the accumulated interest and commissions of all former bills. The in- 
terest was five per cent, in the year, and the commission was never less than 
one-half per cent, on each draft. This commission being repeated more 
than six times in the year, whatever money A might raise by this expedient, 
must necessarily have cost him something more than eight per cent, in the 
year, and sometimes a great deal more, whenever either the price of the 
commission happened to rise, or when he was obliged to pay compound in- 
terest upon the interest and commission of former bills. This practice was 
called raising money by Circulation." — Smith's Wealth 0/ N^ations, Edinburgh 
ed., 1846, pp. 136, 136. 

" When two people," says Adam Smith, " who are continually drawing 
and re-drawing upon one another, discount their bills always with the same 
banker, he must immediately discover what they are about, and see clearly 
that they, are trading, not with any capital of their own, but with the capi- 
tal which he advances to them. But this discovery is not altogether so easy 
when they discount their bills sometimes with one banker, and sometimes 
with another, and when the same two persons do not constantly draw and 
re-draw upon one another, but occasionally run the round of a great circle 
of projectors, who find it for their interest to assist one another in this 
method of r'aising money, and to render it, upon that account, as difficult as 
possible to distinguish between a real and a, fictitious bill of exchange — be- 
tween a bill drawn by a real creditor upon a real debtor, and a bill for 
which there was properly no real creditor but the bank which discounted 
it, nor any real debtor but the projector who made use of the money. When 
a banker bad even made this discovery, he might sometimes make it too 
late, and might find he had already discounted the bills of those projectors 
to so great an extent, that, by refusing to discou nt any more, he would neces- 
sarily make them all bankrupts, and thns, by ruining them, might perhaps 
ruin himself." — Adam Smith's Wealth of Nations, Mdin. ed., 1846,^. 13Y. 

The method above described was by no means, says Aham Smith, " the 
most common or the most expensive one in which those adventurera some- 
times rained money by circulation. It frequently happened that A in Edin- 
burgh would enable B in London to pay the first bill of exchange, by draw- 
ing, a few days before it came due, a second bill at three months' date, upon 
the same B in London. This bill, being payable to his own order, A sold 
in Edinburgh at par; and with its contents purchased bills upon London 
payable at sight to the order of B, to whom he sent them by the post. To- 
wards the end of the late war, the exchange between Edinburgh and Lon- 
don, was frequently three per cent, against Edinburgh ; and those bills at 
sight must frequently cost A that premium; this transaction, therefore, 
being repeated at least four times in- the year, and being loaded with a 



APPENDIX. 303 

commission of at least one half per cent, upon each repetition, must at that 
period cost A, at least 14 per cent, in the year." — Smith's Wealth of Na- 
tions, JSdin. ed. 1846, _p. 186, Note 2. 



""We do not mean to' insinuate," says Mr. MoCclloch, "that there are no 
Jietitious bills of exchange, or bills drawn on persons yrho are not really in- 
debted to the drawer, in the market. In every commercial country, bills of 
this description are always to be met with ; but they are only a device for 
obtaining loans, and do not, and cannot, transfer real debts." • * * * 
"The merchants who purchase, or the bankers who discount these bills, 
really advance their value to the drawers, who, as long as they continue, by 
means of this system of drawing and re-drawing, to provide funds for their 
payment, command a borrowed capital equal to the amount oi fictitious 
paper in circulation. It is clear, however, that the negotiation of such bills 
has no effect in the way of transferring and settling the the real bona fide 
debts reciprocally due between any two or more places. Mctitious bills 
balance each other. Those drawn by London on Glasgow, are exactly equal 
to those drawn by Glasgow on London, for the one set is drawn to pay the 
other, — the second destroys the first, — and the result is nothing. The 
method of raising money by the discount or sale of fictitious bUls, has been 
severely censured by Dr. Smith, as entailing a ruinous expense oh those en- 
gaged in it, and as being resorted to only by projectors or persons of sus- 
picious credit" — McCullocKs Essay on Exchange. 



History op a Scottish Bane — established in 1769 — Failed in 17T1. 

This Bank had a paid-up capital of £128,000, or 80 per cent, of £160,000. 
It was established, says Adam Smith, for the purpose of relieving the dis- 
tresses of the country, under the firm of Douglass, Heron &, Co. Its coffers 
were never well filled. A great part of the proprietors when they paid iu 
theu- first installment, opened a cash account with the bank ; and the direc- 
tors,, thinking themselves obliged to treat their own proprietors with the same 
liberality with which they treated all other men, allowed many, of them to 
borrow upon this cash account what they paid in upon all their subsequent 
installments. Such payments, therefore, only put into one coffer what had 
the moment before been taken out of another. "But," says Adam Smith, 
" had the coffers of this bank been filled ever so well, its excessive circulation 
must have emptied them faster than they could have been replenished by any 
other expedient but the ruinous one of drawing upon London, and when 
the bill became due, paying it, together with interest and commission, by 
another draught upon the same place. Its coffers having been filled so 
very ill, it is said to have been driven to this resource within a very few 
months after it began to do business. The estates of the proprietors of this 
bank were worth several millions, and by their subscription to the original 
bond or contract of the bank, were really pledged for answering all its en- 
gagements. By means of the great credit which so great a pledge neces- 
sarily gave it, it was, notwithstanding its too liberal conduct, enabled to 
carry on business for more than two years. When it was obliged to stop, 
it had in the circulation about two hundred thousand pounds in bank notes. 
In order to support the circulation of those notes, which were continually 
returning upon it as fast as they were issued, it had been constantly in the 
practice of drawing bills of exchange upon London, of which the number 
and value were continually increasing, and, when it stopped, amounted to 
upwards of six hundred thousand pounds. This bank, therefore, had, in 
little more than the course of two years, advanced to different people up- 



304. APPENDIX. 

Bank of "Watertown v. Assessoes, &c.j of "Wateetown. 

(25 Wendell, 686, 687.) 

Assootatipns In Jult, 1841, the Supreme C&ti/rt held, on a motion for 
tYon^and"" ^ mandamus — that associations formed under the General 
as such, are Banking Law, a/re GorporaMcms, and as such, are liable, 
taxation, like Other moneyed institutions, to be taxed on all lands 
and personal estate owned by them. See 1 B. S, 414, § 1, 
p. 224, flOTte. (79) • ' 

■wards of eight hundred thousand pounds at five per cent. Upon the two 
hundred thousand pounds which it circulated in bank notes, this five per 
cent, might, perhaps, be considered as clear gain, without any other deduc- 
tion besides the expense of management. But upon upwards of six hundred 
thoiisand pounds, for which it was continually drawmg Ijills of exchange 
upon London, it was paying, in the way of interest and commission, up- 
wards of eight per cent., and was consequently losing more than three per 
cent, upon more than three fourths of all its dealings, » * » 

" At the first setting out of this bank, it was the opinion: of some people, 
that how fast soever its coffers might te emptied, it might easily replenish 
them hy raising money upon the securities of those to whom it had ad- 
vanced its paper. Experiefnoe, I believe, soon convinced them that this 
method of raising money was by much too slow to answer their purpose ; 
and that ,coffers which originally were so ill filled, and which emptied 
themselves so very fast, could be replenished by no other expedient but the 
ruinous one of drawing hills upon London, and when they became due, 
paying them by other draughts upon the same place with accumulated in- 
terest and commission. But though "they had been able by this method to 
'raise money as fast as they wanted it, yet instead, of making a profit tliey 
must have suffered a loss by every such operation ; so that in the long run 
they must have ruined themselves as a mercantile company, though, per- 
haps, not so soon as by the more expensive praietice of drawing and re- 
drawing., They could still have made nothing by the interest of the paper, 
which, being over and above what the circulation of the country could ab- 
sorb and employ, returned upon them, in order to be exchanged for gold 
and silver, as fast as they issued it ; and for the payment of which they 
were themselves continually obliged to borrow money. On the contrary, 
the whole expense of this borrowing, of employing agents to look out for 
people who had money to lend, of negotiatmg with those people, and of 
drawing the proper bond or assignment, must have fallen upon them, and 
have been so much clear loss upon the balance of their accounts. The pro- 
ject of replenishing their coffers in this manner may be compared to that of 
a man who had a water-pond, from which a stream was continually running 
oiit, and into which no stream was continually running, but who proposed 
to keep it always ejjually full by employing a number of people to go con- 
tinually with buckets to a well at some miles' distance, in order to bring 
water to replenish it." — Adam Smith's Wealth of Nations, Edin. ed. 1846, 
pp. m,lS8, 139, and Notes. 

Mb. Justice Bbonson's Definition op a Cokporation., 
(79) " A corporation aggregate,. is a collection of individuals united in 
one body, under such a grant of privileges as secures a succession of mem- 
bers without, changing the identity of the body, and constitutes the 



APPENDIX. 306 

The People t. Assessors of "Wateetown. 

(1 mil, 616-623.) 

This is the same case reported in 25 Wendell, 686. The 
opinion of Nelson, C. J., is reported in 25 Wendell, 
and of Branson, «/;, in 1 Hill. 



members for tlie line being, one artificial person or legal being, capable 
, of transacting some kind of business like a natural person. It does not 
occur to my mind, that any thing else can be essential to the definition. 
Such a union as I have mentioned, can only be effected under a grant of 
privileges from the sovereign power of the State. A corporation is there- 
fore said to be a legal being, or the mere creature of law. It is convenient, 
though not absolutely necessary, that this artificial person, like a natural 
one, should have a name by which it may be known and designated in the 
transaction of business. And when the doctrine was, that a corporation 
could only contract by its seal, a seal was said to be an indispensable 
requisite. So, immortality was once thought to be an attribute of all cor- 
porations; but that now means no more than a continued succession of 
members for such period, whether long or short, as may be allotted to this 
legal entity by its creator." — The People v. The Assessors of Watertown, 1 
Hill, 616, 620. 

Chief Justice Makshall's Defisition of a Coeporation. 

" A corporation is an artificial being, invisible, intangible, and existing 
only in contemplation of law. Being the mere creature of law, it possesses 
only those properties which the charter of its creation confers upon it, 
either expressly, or as incidental to its very existence. These are such as 
are supposed best calculated to efl'eot the object for which it is created." — 
Dartmouth College v. Woodward, i Wlieaton, iJ. 636. 



Mb. Ktd's Definition of a Corporation. 

" A corporation, or bo(3y politic or body incorporate, is a collection of 
many individuals united in one body, under a special denomination, having 
perpetual succession under an artificial form, and vested by the policy of 
the law with a capacity of acting, in several respects, as an individual, par- 
ticularly of taking and granting property, contracting obligations, and of 
suing and being sued; of enjoying privileges and immunities in common, 
and of exercising a variety of political rights, more or less extensive, ac- 
cording to the design of its institution, or the powers conferred upon it 
either at the time of its creation or at any subsequent period of its exist- 
ence." — Kyd on Corp. Intro. 13. 



Mr. Jambs Grant's Definition of a Corporation. 

" The ideal being, called a corporation, we may thus define to be a con- 
tinuous identity, endowed at its creation with capacity for endless dura- 
tion, residing in the grantees of it and their successors ; its acts being deter- 
mined by the will of a majority of the existing body of its grantees or their 

20 



306 APPENDIX. 

Hunt v. Van Alstyne. 

(25 Wendell, 605-614.) 

In October, 1841, the Swpreme Gowrt held, on demurrer 
to pleas, in an action on a bill of exchange, in the name of 
an mdwidual describing himself as the Piresideni of a 
banking association, that a plea in iar of the action — that 
the General Banking Law (under which the association was 
formed) was not passed by a vote of two-thirds, &c. — is not 
good, where the plaintiif fails to allege titl Ao the bill, and 
the declaration, besides the count on the bill, contains the 
common counts. 



Bank of Okleans v. Meeeill. 

(2 Hill, 295.) 

Postcer- In Jan0aey, 1842, the Supreme Court Jield that a cer- 
dopMituie- tificate of deposit issued by a general law bank, payable 
»*'■ to the order of a particular person, 6 months after date. 



Buooessors at any given time, acting mthin the limits imposed by tlie con- 
stitution of their body politic, such will being signified to strangers by 
uniting under the common seal ; having a name, and under such name a 
capacity for taking, holding, and enjoying all kinds of property, a qualified 
right of disposing of its possessions, and also a capacity for taking, hold- 
ing and enjoying, but inalienably, liberties, franchises, exemptions, and 
privileges ; together with the right or obligation of suing and being sued 
only under such name. This is the definition of the ideal creation, — the 
ens rationis called a corporation; and it will be found to measure and de- 
scribe accurately the attributes of a corporation proper ; that is to say, a 
corporation created merely as a corporation, without any restrictive or 
limiting clauses in the instrument of creation. It is not by any means 
true, however, that all existing corporations come up fully to the whole 
extent of the above definition, because corporations are held to be in 
this country, the creatures of the crown or of Parliament, and conse- 
quently there is scarcely any limit to the variety of forms in which they 
may be produced. But continuous identity, a name and a common seal, 
seem indispensable requisites to the creation of a corporation proper." — 
Grant on Corporations, London ed. 1850, pp. 4, 5. 

Distinction between Cobpobations & Partnerships. 

"It has been said, that the great distinction between the common joint 
stock companies or partnerships, and corporations, is, that in the first, the 
lam looks to the individuals of whom the partnership is composed, and 
knows the partnership no otherwise than as being such a number of individ- 
uals; while in the second, it sees only the creature of the charter, the body 
corporate, and knows not the individuals." — Wordtworth't Law of Joint 
Stock Companies, p. 4. 



APPENDIX. 307 

■with interest, is, in' effect, a promissory note — and cannot 
be sanctioned as the basis of a recovery, ■without disregard- 
ing the provisions of the statute against the issue of a spuri- 
ous and illegal currency ; and that this case is -within the 
principle of Safford v. Wyckoff, <& Smith ds Warner v. 
Strong. (80). See Zeavitt v. Palmer (3 Comst., 19). 

(80) In the case of the Southern Loan Company v. Morris (2 Barr'a Penn. 
R. 176), the Supreme Court of PennsylTania held, that an indorser is not 
liable on a, promissory note of a corporation which it could not lawfully 
issue,— even though the instrument purpo'i-ted to be a certificate of deposit 
■which it -was lawful for such corporation to issue ; for the reason that prop- 
erties of promissory notes which are forbidden, cannot be given to lawful 
instruments. The certificate of deposit, held illegal in this case, -was in the 
form following : 

" The Philadelphia Loan Company promises to pay to S. Morris, or order, 
$1000, three months after date, being a deposit made by him with the Company, 
bearing interest at the rate of — per cent, per arinum, payable at the office of 
the Company." 

" GEO. S. SCHOTE, Pkesident. 
"T. MOORE, Cashiee." 

{Indorsed by defendant.) 

The 16th section of the charter of this company expressly authorized 
"a certificate of deposit to be given to the depositor, stating the rate of in- 
terest, and the period for which such a deposit is made ;" but this company 
was prohibited from issuing notes or bills of credit, or promissory notes in 
the nature of bank notes, or exercising any banking privileges. " But vain 
are legislative enactments," says Seegeant, J., " if disregarded by those in- 
trusted to execute them. These plain directions have been unceremoniously 
set aside, by the issue of instrumfints,"which, in their ostensible character 
and effect, are as plain promissory notes as it is possible to make them : be- 
ing promises, in consideration of money received, for the payment of money, 
payable to order at a certain time, and then negotiated and put in circula- 
tion." » * * "And even if they were legitimate Certificates of Deposit, 
such as the Company are authorized to issue, they would not be negotiable 
■ instruments, so as to make the indorsee liable on his indorsement." (2 £arr 
JJ., 175-177.) 

In the case of Miller v. Austin (13 Howard, 218), the Supreme Court of 
the United States held a certificate of deposit, in the form following, to be a 
negotiable instrument or promissory note: 

" MissiPsippi Union Bank. 
"Jackson, Miss., Feb. 8, 1840. 
"Ifo. 959. 

" / hereby certify that Hugh Short has deposited in this bank, payable 
12 months from 1st May, 1839, with 5 per cent, interest till due, fifteen hun- 
dred dollars, for the use of Henry Miller, and payable only to his order, upon 
the return of this certificate. 

" Wm. p. Geatson, Cashiee." 
Endorsed "Henry Miller." 

"Austen. Wilmerding, tb Co.'' 
See the Form of the Certificate of Deposit passed upon by the Supreme 
Court of Errors of the State of Connecticut in the case of Kilgore v. Buck- 
ley {li Conn. R., 363). Also i/borc v. Oano (12 Ohio, 300). Zeavitt v. 
Palmer (3 Comstook, 19, 35). In the matter of the Oho Life Insurance and 
Trust Company (9 Ohio, 291) : Lawler v. Walker (18 Ohio,' 151); also Note 
51, pp. 114-122 ante: also MotelS, p.SOO ante. 



308 APPENDIX 

Smith & Waenee v. Steong. 

(2 mil, 241-247.) 

Aesocia- In Januaet, 1842, the Sv/preme Gourt held, that associa- 
powto te"° tions under the general banking law,' have no power to 
^™"^^j issue negotiable paper of any kind, save under the sanction 
counter-Bign- of the Comptroller ; and that bills of exchange, payable at 
oompkouer. a future day, answer the purpose of a circulating medium, 
and so are within the restrictions of the genersd banking 
law against the issuing of unauthorized paper — and that an 
indorsee of such a bill, drawn by such an association, is 
chargeable with notice of its illegality, and cannot, there- 
fore, recover against the indorser. The case of Safford v. 
Wychoff (1 Hill, 11), commented on and explained. 

This was an action of assumpsit against the indorser of 
a bill of exchange for $1000, payable four months after 
date. The objection was taken at the trial, that it was 
issued contrary to the 4th section of the Act of May 14th, 
1840. See § 4. Act of May 14<A, 1840, p. 114 ante : and 
form of hill in this case, p. 119 ante; also, Note 78,^. 
300 ante. (81) 



WiLLOIJGHBT 1). CoMSTOCK. 

(3 mil, 389.) 

AsMoift- In July, 1842, the Su^preme Court held, that assOcia- 

"MaUMs!'""tio'^3^'i<ier the General "Bank Act of 1838, are corpora- 

(81) The distinction between bills of exchange drawn or issued by hankers, 
and mercantile bills of exchange, is thus stated by William John Lawson, 
iahii History of BanKng : — 

" There is also a difference between banker's bills of exchange and mer- 
cantile bills of exchange, inasmuch as the /orm# are, essentially in their 
nature, the same as bank notes payable on demand ; but they are less secure 
than notes payable on demand, because the banker may fail before the hill 
becomes due. The issue by a banker of his bill, is not a proof of any trans- 
action in trade ; it is a mere exchange of credits. The banker creates, and 
puts out, a piece of paper that will circidale, against one or many that will 
not circulate. The banker's bill of exchange will circulate because the con- 
fidence in his ability to pay the bill at maturity, is undoubted ; the differ- 
ence, therefore, between the bill of exchange which the banker creates 
entirely upon himself, and those other bills of exchange which are created 
by the customers of the banks, is, that the latter are the real types of the 
quantity of business done upon credit, whilst the credit which circulates is the 
quantity which the banker chooses to send out of either sort." — Lawsoria 
Hist, of Banking, London ed., 1850, p. 44. 



APPENDIX. 309 

tions, and hence in an action against such an institution, it 
is no ground of defence that tne defendant is a member 
thereof. 



The People v. Stjpeevisoes of Niagaka. 
(4 Mill, 20-26.) 



In Decembee, 1842, the Supreme Cov/rt held, that as- Assoeia- 
sociations formed under the General Banking Law, are por°ati?r8,"™d 
Corporations, and like other moneyed or stock corporations J^^jf^,^^ *" 
are liable to taxation on their capital. See 1 R. S. 414, § 1, 
p. 224: ante : this case affirmed hy the Cov/rt of Errors. 



IN THE COURT OF ERRORS. 



Saefoed v. "Wyokoff. 
(4 Bill, 442-446.) 

In December, 1842, the Coitet for the Ooeeeotioh- of 
Eeeoes reversed the decision of the Swpreme Court in this 
case. The head-note of the reporter is as follows : 

■ " A negotiable draft or bill of exchange in the ordinary- 
form, though issued by an association organized under the 
general banking law, without the sanction of the comp- 
troller, will bind the association as in favor of a ionafide 
indorsee; and this notwithstanding it be signed by the 
Cashier only." 

" Otherwise, however, as between the association and 
one not occupying the position of a ionafide holder, if it 
appear that the draft or bill was issued hy way of loan, — 
or for thepwfose of heing ^t in circulation as money. 
SemhleP 

" How far these associations may, as incidental to the 
general powers expressly conferred on them by statute, 
issue negotiable paper, without the sanction of the comp- 
troller — e. g., for the payment of their debts, the transfer 
of their funds, &c. — discussed and considered." 

" Where there is enough on the face of a negotiable note 
or bill of exchange to create a suspicion that it was issued 



310 APPENDIX. 

contrary to law, and to put the party wlio takes it upon 
inquiry, he is not entitled to be considered a hona fide 
holder. SemMe." 

" A negotiable note or bill of exchange, though given 
by a corporation having only an incidental right of issuing 
such paper in certain special cases, must be presumed to 
have been legally issued until the contrary appear- Sem- 
Me." (82) 



Valk v. Ceandall. 
(1 Sand. Gh. E., 179.) 

Astomoac In Ootobee, 1843, Assistant Yice- Chancellor Sandford 
"' "orat^M ^'^^^ — *^^* associations under the General Bank Act are 
corp on . gQjjgjjgjj ^Q ^]jg provisions of that act, and cannot be legally 
organized until its substantial enactments, relating to the 
mode and manner of organization, are substantially com- 
plied with. 



(82) It is difficult to say, what was really decided by the Court of Mr- 
rors in this case, except, that it was held that a bill of exchange, although 
signed by the Cashier only (see § 21, p. 98, ante), might support a recov- 
ery, against a banking corporation, by a bona fide holder, in the absence of 
all proof that the bill was not drawn to transfer funds in the legiiimate 
business of banking ; — but whether on the ground assumed by Senators 
Bochee & Sopkins, that the banking corporation could not set up its own 
illegal act ; or on the ground that the drawing of a bill may be included in 
the power to huy and sell bills (See § 18, p. 94, ante), also stated by Hop- 
Tcins, Senator ; or on the ground stated by the Chancellor, that these corpor- 
ations might give negotiable drafts "in payment of the rent of their bank- 
ing houses, the salaries of their cashiers and clerks, and for many other 
purposes connected with the legitimate business of banking " — [and the 
Chancellor adds, " for any thing that appears to the contrary, the draft set 
out in this record, was given in payment of such a debt, though, out of the 
case, it may perhaps be shown that it was made to be putjn circulation as 
money" (4 Hill, 446)]; or on what other ground, the decision was made, — 
query. The Chancillor and Senator Paige delivered written opinions for 
affirmance, and Senators Hopkins and Bockee for reversal. The judgment of 
the Supreme Coui-t was reversed by a vote of 13 to 9. 

It should be stated, that neither the general prohibition in 1 R. S. 600, § 3 
{p. 25 ante), nor the express prohibition in § 85 (p. 38 ante), were referred 
to in this case, either in the Supreme Court, or in the Court of Errors. The 
question as to the application, to these banking corporations, of the general 
statutes of this State, relating to moneyed corporations, was not raised in this 
case : that question has since been finally adjudged by the Court of Appeals 
in Oillet r. Moody (3 Comst., 4'79),' and m Talmage v. Pdl (3 Selden, 328). 
See also Gillet v. Phillips, decided by the Court of Appeals in October, 
1855. See form of bill in this case, p. 118 ante: also Note '78, p. 800, ante. 
Also, Note %\,p. 308 ante. See James v. Patten (2 Selden, 9). 



APPENDIX. 311 

Leavitt v. Tylee. 



(1 Sand. Oh. B., 207-210.) 

In Novembee, l^siZ^ Assistant Vice- Chancellor Sand- ie. 8.,69i, 
ford held — that an assignment made by an insolvent bank- fVs'ante!'''' 
ing association under the general law, was invalid in law 
by the Sth & 9th sections qflH. S., 591. 



In the. Matter op the Bank of Dansville. 

(6 mil, 3T0-372.) 

In Maeoh, 1844, the Supreme Court /ie^c^that that ^ As to^mm- 
Court had no authority to set aside an election of directors of snpremo 
by an association under the general banking law. — But^^^ 
see Gilletv. Moody, in the Court of A^jpeals (3 Comst. 479), 
and note 40 engage 98 ante ; also, Talmage v. Pell (3 Sel- 
den, 328). 



BoiSGEEAED V. N. Y. BANKING CoMPANY, 

(2 Sam,d. Ch. B., 23-28.) 

In August, ISii, Assistant Vice-Chancellor Sandford Eev.stat 
held — that banking associations under the general law of ^■*"™'*' 
1838, are within the provisions of the Bevised Statutes 
relative to proceedings against corporations in equity. 



IN THE COURT OF ERRORS. 



SUPEEVISOES OP NlAGAEA V. ThE PeOPLE. 

(7 Hill, 604-5 18-.) 

In December, 1844, the Couet foe the Coeeeotion op Aesocia- 
Eeeoes AeZ<^ — 'that associations formed under the general """>«"««>'- 
banking law, are corporations within the meaning of 1 B. =880"^^'^ 
8., 414, § 1, and liable to taxation on their capitals. See uo^&o*"''*" 
1 B. S, 414, § 1, p. 224 ante. 



312 APPENDIX. 

De Bow v. The People. 

(1 Denio, 9-19.) 

tiotfSre'' r ""^ Mat, 1845, the Swpreme Court held — ^that associa- 
poratio'ns"'' tions undcx' the General Bank Act were corporations, upon 
!Sl)ra°idng'''the supposition that the act was constitutionally passed : 
lawToid. ijyt ^2A the act, not having received the assent of two- 
thirds of either branch of the legislature, is, so far as it 
professes to authorize the formation of associations to carry 
on the business of banking, utterly void : and that the bank- 
Thueme i^g Companies which have been organized under it, have 
overruled, qq legal existence. Bui see Q-ifford v. Livvngston, in ths 
Court of Errors (2 Denio, 380). 



GiLLET v. Campbell. 

(1 Denio, 520-523.) 

iE,s.,59i, In October, 1845, the Supreme Court held — that an 
,^^°^S^^ assignment made by a bank under the general law, of a 
•• security of the value of over $1,000 is not within 1 JR. S., 
591, § 8, forbidding such assignment by a moneyed corpora- 
tion. — But see Gulet y. Moody in the Court of Appeals 
(3 Comst., 479,) and Gillet v. Phillips, decided oy the 
Court of Appeals in October, 1855. 



S a Bee S 8 
andni ' ' 
Icmlt. 



IN THE COURT OF ERRORS. 



GiFFORD V. Livingston. 
(2 Denio, 380-402.) 

The gene- In DeOEMBEE, 1845, the GoUET EOE THE CoEEECTlOlir OF 

™1''™S Errors AeZi^— that the act entitled " An Act to authorize 
»<!*• the business of banking," passed April 18, 1838, was con- 

stitutionally passed, although it did not receive the assent 



APPENDIX. 313 

of two-thirds of the members elected to each branch of the 
legislature, and is a valid act. By this judgment, the case 
of De Bow V. The People (1 Denio, 9) was overruled. See 
Pdkner v. Za/wrence (1 Selden, 381).) 



Leavitt v. Geiffin. 

(3 Scmd. Ch. B. 170, Wote A.) 

In March, 1846, Assistant Vice- Chancellor Scmdford ie. B.591, 
held — that a transfer of corporate effects, made by an in- |\„™f *'^^ 
solvent banking association, for the benefit of James Hol- 
ford, of London, and the Eeal Estate Bank of Arkansas, 
was invalid in law iy 1 B. 8., 591, § 8 & § 9. 



Sagoey v. Dubois. 

(3 Sand. Ch. B., 466.) 

In Maech, 1346, Assistant Vice- Chancellor Sandford Assoda- 
held — ^that associations under the General Bank Act, are "™„?5° ""' 

■ 1 1 1*11 1 •• /»i purauouo. 

corporations, and as such, are liable to the provisions of law 
in respect of moneyed corporations, except where such pro- 
visions are inconsistent with the special legislation relative 
to these associations. See Talmage v. PeU (3 Selden, 328) 
and Oillet v. Moody (3 Gomst., 479). 



Swift v. Beees. 

(3 Denio, 70-71.) 

In Mat, 1846, the Supreme Court held — that the pro- ^^j,^^ 
hibition in the fourth section of the act of May 14th, 1840iiponthe 
{Lams 1840, 306, § 4) applies to and renders illegal alirp^;^^"' 
promissory notes made by a banking association, unless 
made payable on demand and without interest, though not 
intended to circulate as money ; and that a guaranty of 
such a note partakes of the character of the principal con- 
tract, — being intended to reinforce and secure it, — and is 
equally illegal. See Leavitt v. Palmer, in the Court of 
Appeals (3 Oomst., 19): McGregor v. The Dover and Deal 
Bailway Company {7 ^a.i[wa.y Cases, 226) : Boot v. Godard 
(3 McLean, 102),: Hayden v. Davis {Z McLean, 276) : Boot 
V. Wallace (4 McLean, 8.) See form of note and guaranty 
in this case, p. 119 ante. 



314 APPENDIX. 

Blunt v. Hanna, & Bluht v. Maetik. 

{Not reported.) 

Kev.stat. In THE TBAE 1846, Assistomt Vice-Chwncellor Scmd- 
■Tante. '^' ford held, that assignments of mortgages by a banking 
association, under the general banking law, were not valid 
in law, because not authorized by a previous resolution of 
the Board of DvreotOTS ; that such previous resolution 
was, by statute (1 E. S., 591, § 8), as necessary a part of 
the authority of such banking association to execute the 
transfers, as was the general bank act itself, which brought 
the association into existence. See Gillet y. Moody {^ 
Comst., 479) ; Hoyt t. Thompson (1 Selden, 320), and Tal- 
mage v. Pell (3 Selden, 328) ; Johnson Y.^ush (3 Barb. 
Ch. E., 179) ; Bosanquet Pub. Officer v. 8h.ortridge (4 W. 
H. & G-i 699). See opinion of Assistant Yioe- Chancellor 
Sandford, in the above cases, in Note 4, J>. 7 ante / also, 
opinion of Oao'dimsr, 0. J.,m Gillet v. PhilUps, decided 
by the Court of Appeals in October, 1855. 



Leavitt v. Yates. 

(4 i:dw. Ch. P., 134-209.) 

800 post- In Septembee, 1846, this case was heard and determ- 

cMed'bytheiiisd upon pleadings and ^voois, hjVice-Chancellor Mc- 

Tates trust Coun. A banking association issued in December, 1840, 

MBignmen g^^ promissory notes, all of the same date, payable 

thirteen months after date (with interest) to the order of a 

clerk in the employ of the association, and at the same 

time, executed a trust deed conveying to trustees corporate 

effects to secure the payment of said notes, said deed and 

notes bearing the same date. The ViceChancdlqr held, 

that the 800 notes were within the prohibitions of the 

Eestrata- Pestrcdning Act, as well as of the Act of May 14th, 1840, 

ins Act of aii(j -^ere illegal and void ; and also that they were void, 

of May 14th bccause uot countcrsigned by the Comptroller or secured 

■'^*''' as required by the general banking law ; and that the notes 

being illegal and void, the trust deed made to secure them 

was also void. This case is generally known as the " Yates 

Trust Case." No appeal was ever prosecuted from the 

decree made by the Vice- Chancellor. See form of notes 

in this case, p. 119 ante. 



APPENDIX. 315 

Ttlee v. Yates. 

(3 Barb. 8. O. JS., 222-229.) 

In June, 184:8, the Supreme Court {ShanMcmd, Gray, rates 
cfe Sill, Justices) held, that post-notes issued by a bank- ^b\°°„'f> 
ing association, dated December 15th, 1840, were abso- time, Toid. 
lutely void, and that an assignment of securities by means 
of a trust deed, as collateral for the payment of such post- 
notes, is also void. See Leavitt v. Palmer, decided in 
1849, by the Court of Appeals (3 Comst., 19). 



Leavitt v. Blatchfokd. 

(5 Ba/rb. 8. C. B., 9-37.) 

In ISTovEMBEE, 1848, the Supreme Cov/rt {Hwrlhut, Mo- Post-notes 
Coun, & Edwards, Justices), held, that banking associa- g»T*i«^^i^_ 
tions under the General Bank Act of 1 838, are corporations, renoy : se- 
and that all general laws relating to moneyed corporations S^JdEn- 
applied to such associations — accordingly, that the V^'o-'^^^^-J^^ 
visions of the Eevised Statutes, 1 E.S., 588, to prevent the aAu.' 
insolvency, &c., of moneyed corporations, are applicable to 
such associations ; that under the provisions of the act of 
May 14th, 1840, promissory notes given by a banking 
association, payable after date, are illegal and void, even 
though they were not intended to circulate, and were in- 
capable of circulating, as money ; and although such notes 
were payable in London, in sterling money : but that 
though such notes were void, the original indebtedness for 
which they were given, remained, and that a deed assign- 
ing property in trust as collateral security for the pay- 
ment of such indebtedness, was valid. The deed in this 
case recited such original indebtedness. But the judg- 
ment of the Supreme Court, in this case, so far as it upheld 
the trust deed as a valid security for the illegal notes, was 
reversed by the Court of Appeals, in Leavitt v. Palmer (3 
Comstock, 19). This is generally styled the '■'• Blatchford 
& Murray Trust Case." See form of notes, p. 120 ante. 



Gillet v. Moodt. 

(5 Bark, 8. C. B., 185-190.) 

In Januaet, 1849, the Supreme Court {Paige, TP?^ Associa- 
lard, (& Hand, Justices) held, that banks formed under though cor 



316 APPENDIX. 

pojaHons,arethe general banking law are corporations constitntionally 

the^rovi-" formed — but that they are not within the provisions of the 

^S^*" Revised Statutes (1 R. 8., 591, § 8, § 9, seepp, 1, 8 anie), 

statutes. « to prevent the insolvency of moneyed corporations, and to 

secure the rights of their creditors and stockholders." But 

see this case reversed in the Coiort of Appeals (3 Comst. 

479.) 



Palmer v. Yates. 

(3 Sand. Sup. E., 137-161.) 

Aresoiu- In Septembee, 1849, the Superior Court of the City of 

JumotT' ^ew York {Duer, Mason, <& Campbell, Justices) held, in 

fhorizinTa tliis.case, that a resolution of a Committee of the Board of 

transfer of Directors of a banking corporation, authorizing the trails- 
corporate ef-/. /. , ™, ■'■t '. T ^^ 

feots exceed- ler 01 Corporate enects exceedmg m value $1,000, is a 
$1000,1111?- suflacient compliance with the statute (1 E. S., 591, § 8), 
piianc6''wTth '^W^ *^® maxim ratihaiitio priori mandato cequiparatwr • 
lis. ;S 591, sand that when a prior authority is rendered necessary, by 
each "a 'trans? a statutory provisiou, the want of such an authority may 
tboSzedby°a ^^ S"Pplied, and the act impeached be rendered valid by 
folSn o?" P''°°^ °^ i''^ adoption by the party by whom it might have 
the ^oor-d o/been authorized; although a resolution of a Board of 
"^bs^uent Directors, ratifying an assignment made by a president of 
pHes'the^"'*' ^ banking corporation, without authority, may have no 
want of prior retroactive force; yet, the assignment is valid from the 
"EaiTa'cation time that the sanction of the Board has thus been given to 
atti°e"fJtce?' ^t J '"^^ ^^^0, that evcry person who, for a valuable con- 
suoha sideration, acquires an interest, legal or equitable, by an 

transfer valid . ', „ ^ , ' '^, . . ,^ , i ■' n 

only from assignment trom a moneyed corporation, is to be deemed a 

time of ^^^<'- ^j^cJiaser within the meaning of the exception contained in 
1 E. S., 591, § 8 ; wnd also, that within this definition, 
every assignee of a bond and mortgage, whether the trans- 
fer is to him directly or to trustees for his benefit and se- 

in 1 A& cnrity, is included. But see 1 E. S., 591, § 8,^. 7 ante; 

i 8 defined, also, "the cases cited in Note i,pp. 7-9 ante / also. Blunt v. 
Sanna & Blunt v. Ma/rtin,p. 314 a/nte, and the opinion 
oi Assistant Yice-Chancdlor, in those cases, in Note 4, pp. 
7-9 ante ; also, the opinion of OardJmer, C. J., in Oillet 
V. Phillips, decided by the Court of Appeals in October, 
1855. 



appendix. 817 

Talmage v. Peil. 

{Not reported) 

In Decembek, 1849, the Supreme Court {Jones, Ed- 
monds, and Hwrlhut, Justices) held, that the State of Ohio 
had a good and valid title to a bond and mortgage for 
$15,000 made by Pell and wife to a banking association, 
and by such association assigned to the State of Ohio as se- 
cm-ity for the payment of certificates of deposit, payable on 
time, and given for Ohio State stocks, purchased by such 
association to sell again, or as a means of raising money. 
But see this case reversed by the Oowrt of Appeals (3 Sel- revera'ei'* 
den, 328.) 



IN THE COURT OP APPEALS. 



Leavitt v. Palmer. 

(3 OomstocJe, 19-40.) 

In December, 1849, the Cottbt of Appeals affirmed so 
much of the judgment o£ the Supreme Court in this case, pg^^^Ma'^' 
as adjudged the notes or certificates referred to in the trust V""'?"' ™. 
deed, illegal and void, and reversed the residue of the de- ing money, 
cree of the Supreme Court — and held, that the statute ofv^l*' 
May 14, 1840 {Stat. 1840, 306, § 4), is not confined in. its 
interpretation to bills and notes capable of circulation as §4p.iu 
money ; that negotiable promissory notes issued by a bank- Stonotes 
ing association, payable in London, in sterling money, 12 "fjFOT'iatint 
months after date, with interest, and delivered to a Lon- »> monsy" 
don firm on account of a previous liability of the bank, 
were illegally issued and void ; and further held, that a 
trust deed, executed at same time, transferring corporate ^.^^1'^^^^ 
effects of the bank to trustees for the purpose of securing secure post- 
the payment of the notes, was also illegal and void ; and''""'' ** ' 
that a court of equity will not reform a deed or writing, 
unless it be alleged and proved that there was a mistake 
or accident in the preparation of the instrument, so that it 
does not express the true intention of the parties ; and that 
a court of equity could not reform the deed in this case, so 
as to enable it to stand as a security for the original liabil- 



318 



APPENDIX. 



ity for which the post-notes were given. See this case in 
5 Barb. S. C. M., 9, under the title of Leavitt v. Blotch- 
ford. ^Qeform of posPrwUs in this case, p. 120 ante. (83) 



Bank of Chillicothe v. Dodge. 
(8 Barb., S. O. R., 233-238.) 



Post-bill 
dated Sept. 
8(Jth, 1889, 
illegal. 



Foreign 
law. 



In March, 1850, the Supreme Court {Johnson, Wells, 
<& Selden, Justices) held, that a draft or bill, dated Sep- 
tember 30th, 1839, payable three months after date, issued 
by a banking corporation, under the general law, is utterly 
fraudulent and void as being prohibited by statute ; and 
that no person by any act can give validity or vitality to. 
it as a commercial paper anywhere ; but that money ad- 
vanced upon such a draft in Ohio, by an Ohio bank, to 
Dodge, the indorsee of the draft, could be recovered back 
in an action against him, on the principle that money thus 
paid, must be considered as having been paid without con- 
sideration ; and also, that such Ohio bank (being a foreign 
corporation) is not presumed to have knowledge of our 
statute. See form of post-Mil in this case, p. 118 ante. 

m 



(83) The Palmers, for whose benefit the trust assignment in this case 
was made, were foreigners, residing in London. The proiniesory notes de- 
creed illegal by the Court of Appeals, were payable in London, in British 
currency. The counsel of the {"aimers raised and argued this point : " If 
the 48 bills or notes were prohibited by the statute, they were not on that 
account Void, especially as they were to be delivered to an English credi- 
tor, as security for an English debt, and were made payable in England;" 
and also, the further point, that if the Palmers " had had full notice of the 
objeot " (of certain bills of exchange involved in the case, and which were 
accepted by them in Londo'n), " they were not chargeable with notice, that' 
such object was an act forbidden by the law of New York." See Palmers' 
Points, in tlie Oowrt of Appeals. 

In 1852, the Girurt of Appeals decided the case of the State of Ohio y. 
Leavitt, Receiver of the Jfforth American Trust and Banking Company, a 
corporation created under the general banking law of the State of New 
York. (3 Selden, 328.) 



(84) Mr. Grant, in his Treatise on the Law of Corporations, says — " There 
is authority to show that foreign-made corporations may sue in this coun- 
try (England) in like manner as a corporation domiciled here, although it do 
not appear that a name had ever been given them, or that they had ever 



APPENDIX. 819 

CirfXER & Sexton t. SanD3?oed. 

(8 Barl., S. O. B., 226-232.) 

In Maeoh, 1850, the Supreme Court {Johnson, Wells, Actofisss, 
da Selden, Justices) held, that the act of 1835, which •"■" ""**■ 
makes it unlawful fur any moneyed incorporation \.o charge 
or receive the premium of exchange on any draft made by 
it, wbich shall be used or applied in payment of any bill 
or note discounted by such corporation, does not apply to 
individual hankers ; that although associations formed un- 
der the General Banking Law, are corporations, yet an 
individual hanker cannot be so regarded ; that he lacks 



Bued'before in the nam« in whiok they brought their action here. It will 
be neoeasary, howeyer, to prove at the trial, by the proper instruments, 
that they are legally constituted a corporation, capable of suing, in their 
own country. Actions of this kind Ue by the comity of nations, although 
the corporation was created in a manner different from that which the law 
of this country requires^ in fact, the law of this country, in all the cases on 
this subject, gives way to, and is ruled by, the law of the foreign country. A 
corporation la deemed to be domiciled in the country frem which it derives 
its act or charter of incorporation." {Gi'ant on Law of Corporations, Lon- 
don ed., 1850, pp. 200, 201.) See Louisville Railroad Company v. Letson 
(2 How., 497). 

, Every person who deals with a corporation, is bound to know what its 
powers are. Public laws of a particular State, creating or limiting the 
powers of its local corporations, are notice to all persons, within or without 
ike State, dealing with such corporations, or in their eontrjots or securities. 
This point was directly adjudged by Mr. Justice McLean,_iu Root v. Godard 
and Hayden v. Davis (3 McLean, C. C. R., 102, 276.) 

A corporation can make no contracts, and do no acts, within or without 
the State which creates it, except such as are authorized by its charter ; 
and those acts must also be done by such officers and agents, and in such 
manner, as the charter authorizes; and if the law creating a corporation 
does not, by the true construction of the words used in the charter, give it 
the power to exercise its powers beyond the limits of the State, all con- 
tracts made by it in other States, would be void. Bank of Augusta v. 
Mrle (13 Peters, 588). 

In construing contracts made by a corporation, the question of corporate 
capacity is always involved. Sank of Chillicothe v. Swayne (8 Ohio R., 
256, 286, 287, 288). Bank of the United States v, Owens (2 Peters, 527). 

" We shall briefly repeat," says Mr. Grant, " a moat important principle 
of corporation law, which has before been adverted to, namely, that a cor- 
poration is not responsible, as a corporation, for acts which, though color- 
ably corporate acts, are not within the competency of the corporation to per- 
form; in such case, the individuals who take part in the pretended corpor- 
ate act, are responsible." Grant on Corp., London, ed, 1850, p. 281. 

That parties dealing with corporations 'are bound to know what their 
powers are, see Mumma v. Potomac Company (8 Petera, 287). East Anglian 
Railway Company v. The Eastern Count ie.i' Railway Company (7 Eng. L. & 
E. E., 605). Broughton v. Salford Water Works Company (3 Barn, and Aid. 
1). Root V. Godard (3 McLean, 102). Sayden v. Davis (3 McLean, 276), 



320 APPENDIX. 

one of the attributes or properties of a eorporaUon, that is, 
its principle of succession and perpetuity. 8ee Act of 
1835, p. 77 ante. 



Bank Commissionees v. St. Laweence Baitk. 
(8 8. a B., 430-439.) 

In Mat, 1830, \hQ Supreme Court {Cady, Paige, Willard, 
(& Hand, Justices) rendered judgment in this suit. In this 
case, a banking corporation under the general law being 
embarrassed, authorized its president and cashier to raise 
money to redeem its circulating notes / under this authority, 
these officers purchased a large amount of state stocks, and 
■gave therefor the notes of the banking corporation, signed 

Poat-notes. ^y the president and cashier, payable on time ; the state 
stocks were applied to the use of the banking corporation ; 
the notes being protested for non-payment, the president 
(who was also an indorser on each note) paid the same.; 

ci»™f<>^'' AeW, that the president had a valid legal claim against the 

^"Sreer. bank to be re-imbursed for the amount so' paid by him; 

and, upon 'the bank's subsequent failure, he was entitled 

to come in as a creditor thereof, before the Receiver, and 

This case have his claim allowed. But see this case reversed by the 
Court of Appeals (3 Selden, 513). See form of post-notes 
in this case, 'p. 120 ante. 



reversed. 



IN THE COURT OF APPEALS. 



GiLLET V. Moody. 
(3 Comstock, 479-488.) 

Associa- In Jttlt, 1850, the Court of Appeals reversed the judg- 

Sme'^edcor-™'^"'' of the Supreme Court in this case ; where a banking 

poraiions associatiou, formed under the general law, being insolvent, 

meaninBofitranst'erred to one of its directors certain Arkansas bonds 

BMp.flMte. in exchange for shares of its own stock, — -this court held, on 

a bill filed by the Receiver of the bank, that the transaction 

was illegal and void under the statute 1 S. S., 589 " to 

prevent the insolvency, (&c.,of moneyed corporations,^'' — and 



APPENDIX. 321 

that the Eeceiver might retain the bonds for the benefit of ^ufiforT/od'to 
creditors; md also, that the transaction was void as toj«^Ji^°8J^5_«_ 
creditors upon general principles, irrespective of the stat- ferred^ con- 
utory prohibition. It was also held, that banking asso- s™m9.° 
ciations under the general law, are moneyed "o?!?"'^^ tio? v°o?d° on 
tions, and as such, are within the statute above mentioned ; general prin- 
and that a Recevoer represents both the creditors and stock- °'^°';„i,. 
holders, and may assert their rights when affected by the tions aro 
fraudulent or illegal acts of the institution. S??oratioM. 

Receiver 
represents 

creditors and 

stockholders. 



IN THE COURT OP APPEALS. 



Palmee, Eeceivee, v. Lawrence. 
(1 Selden, 389-394.) 



In September, 1851, the Court of Appeals held in 
this case, that the Court for the Correction of Errors having 
decided that the General Bank Act of 1838 was constiim- ^^^^ 
Uonally passed, — ^that question must be regarded as settled cofuutMUon- 
by authority binding upon the courts of this State. ««ypa»ed. 



IN THE COURT OP APPEALS. 



Talmage v. Pell. 
(3 Sdden, 328—348.) 



Iir October, 1852, the Court of Appeals reversed the 
judgment of the Supreme Court, and held, that every asso- 
ciation organized under the general banking law, is a asjoj,,. 
moneyed corporation, within the meaning of the statutes ^^'>^'"o 
of this State relating to moneyed corporations: and is ^rpofations, 
hound and affected by those statutes, excepting only soby^ustot- 
far as such statutes are inconsistent with the provisions of ^J°| relating 
the act to authorize the business of banking or of the actspora'ions; '" 
amending the same ; it was further held, that such asso- ''*"'°" '™' 
21 



322 APPENDIX. 

powlrTo ciations are banking oorporaUons and only possess authority 
sff"™! t*'. ^'^'^^y on the business of banking in the manner and 
^'°°''' with the powers specified in the said act ; it was further 
held, that such associations liave no power to purchase 
State or other stocks for the purpose of selling them for 
profit, or as a means of raising money, except when such 
stocks have been received in good faith, as security for a 
loan made by, or a debt due to such association, or when 
taken in payment, in whole or in part, of such loan or 
debt. Where a banking association assigned mortgages as 
collateral security to the holders of its certificates of deposit, 
payable on time, given for State stocks purchased of such 
holders, to sell again — it was held, that the transaction 
was illegal and the assignment of the mortgages void ; and 
mr'^'re^di-*^ was/wr'^Aej' held, that a Receiver oi an insolvent corpor- 
ate illegal ation may repudiate the illegal transfer of its securities by 
b-amfers. its ofiicers, and may claim tuem as a part of Its fuud. See 
form of post notes m this case, p. 121 ante. 



IN THE COURT OP APPEALS. 



Bank Commissionees v. St. Lawrence Bank. 
(3 Selden, 513-517.) 



In Dboembee, 1852, the Court op Appeals reversed the 
ttme*^ven judgment of the Supreme Court in this case, and held, that 
gj^p'"y'°s promissory notes payable on time, and with interest, given 
joidin the by a banking association upon a purchase of State stocks, are 
holder who void, whethcT in the hands of the holder, or of an accom- 
endOT^eT" ^ modatiou endorser, who has paid for them ; and also, where 
State stocks were purchased on a credit by a banking 
association, for the purpose of appropriating them to the 
payment of its circulating notes, the president, who con- 
ducted the negotiation, is charged witli knowledge of its 
illegality, and cannot, by advancing to the seller the price 
agreed to be paid, enforce the payment against the asso- 
ciation. See form of post notes in this case, p. 120. ante. 



APPENDIX. 



323 



GrILLET, EeOEITEE, V. PhILLIPS. 

{Not reported in Supreme Cov/rt.) 



In January, 1853, the Supreme Court {Willard, Cady 
<& Hand, Justices), at a general term, affirmed the 
decree made in this case in December, 1849, by Hand, 
Justice. Mr. Justice Hand held in this case, that the 
transfer and sale of certain notes of the St. Lawrence 
bank, to the defendant, and for which he had advanced 
to that bank $1,200, was void, and that he was liable to 
account for their proceeds to the plaintiff; hut it was 
also held, that the defendant, on such accounting, was 
entitled to be allowed the $1,200, advanced by_ him to 
the bank on the purchase of the notes, with interest ; 
and it was also held that section eighth (1 R. S. 591, 
p. 7 arhte), and section ninth (1 R. S. 591, pp. 8 and 9 
ante), are applicable to corporations organized under the 
general banking law. The judgment of the Supreme 
Court in this Case was reversed by the Court of Appeals 
in October, 1855, See Gillet, Receiver, v. Phillips (3 Ker- 
nan, 114). 



IN THE COURT OF APPEALS. 



Gillet, Reoeivee, v. Phillips. 
(3 Kernan, 114-121.) 



In October, 1855, the Court of Appeals reversed the a/'^ll^^^^ 
judgment of the Supreme Court in this case, and held, effects ex- 
that a transfer made on behalf of a banking corporation, $°ooo?nnan- 
by its cashier,' of promissory notes exceeding $1,000 in *''™™g„*^ 
value, and which was unauthorized by a previous resolu- '^^"g""^ "i 
tion of its board of directors, is illegal ; that the transfer Directors, 
was directly within the prohibition of the jBrst clause of '"o^'etranii- 
the eighth section of 1 R. S. 591 {See § 8, p. 7, ante); that^«^|^Mdden 
such a transfer is void, as against the Receiver (appointed "«<«• ' 
•after the transfer was made), unless the person claiining transfer voia 
under it is a purchaser for a valuable consideration, and Se^eMiTer 



324 APPENDED 

without notice {See last clause of ^ 8, p. 7 ante) j and 
^j^A^-^'r??'<»" where the unauthorized transfer is to a director of the 
with notice bant, he is chargeable with notice ; and also, where the 
pre^^uB res' transfer is unauthorized and the purchaser has notice, he 
ointton. ig jiQt (in an action by the Receiver to avoid the sale and 
receive the property transferred, or its proceeds) entitled 
ser wffSo- to rccoup, uor can he be allowed the consideration paid 
ttfled.°o re"- ^7 ^^"^ ^o the bank ; that the contract in this case was 
eouft nor not Only unauthorized, but illegal ; that no action could be 
allowed the Sustained upon it, if executory, in favor of the defendant, 
SpaS' ^or to set it aside, if executed ; nor could it become the 
foundation of an implied assumpsit in behalf of the offend- 
ing party. 



CuETis V. Lkavitt, & Leavitt v. Blatohfohd. 
(18 Barl. S. G. B. 309-3T8.) 



In December, 1853, the Supreme Court {Edwards, 
Mitchell c& Boosevelt, Justices), held that certain trust 
conveyances made to Blatchford, Curtis and Graham, trus- 
tees, by the North American Trust & Banking Company 
(an association under the general banking law), to secure 
the payment of 1350 obligations issued by that Company, 
bearing even date with the conveyances, payable on time, 
were legal and valid conveyances. 

These cases are now pending in the Court of Appeals, 
and are generally known as the Million and J^irst Half 
Million trust cases. 



Leavitt, Receivek, v. Geaham. 
{N'ot reported in Supreme Court.) 



In July, 1854, the Supreme Court {Mitchell, JRoosevelt 
cfe Clerhe, Justices), held that a certain trust conveyance 
made to Blatchford, Curtis and Grkham, trustees, by the 
North American Trust & Banking Company (an associ- 



APPENDIX. 325 

ation under the general banking law), to secure tlie pay- 
ment of 450 obligations issued by that Company, bearing 
even date with the conveyance,, payable on time, was a 
legal and valid conveyance. 

This case is now pending in the Cowrt of Appeals, and 
is called the Second Half Million trust case. 



Tkact v. Talmage. 
(18 Ba/rl. 8. O. E. 456-466). 



In September, 1854, the Sitpreme Court {Mitchell, 
Boosevelt c& Gierke, Justices), held that a bank organized 
under the general banking law, has authority to buy, at a 
discount. State stocks ; and is not prohibited from issuing 
its engagements on time, provided they are not adapted 
nor intended to circulate as money ; that such a baiok is 
not a body corporate within the meaning of the constitu- 
tion or the general banking law; and is not subject to 
penal regulations, involving forfeiture or imprisonment, 
enacted in reference to corporations proper. 

This case, generally known as the Indiana Case, is now 
pending in the Cov/ri of Appeals. 



The Court of Errors, and the Court of Appeals, have 
expressly and finally adjudged in the following cases, that 
associations organized under the general banking law, are 
corporations. 

1844. Supervisors of Niagara v. The People. 311 ante. 
1850. Qillet, Receiver, v. Moody. 320 ante. 

1852. Talmage v. Pell. 321 ante. 



INDEX 



PRINCIPAL MATTERS. 



««» 



P»g«. 

ABATEMENT of suits by or against corporations, act to 

prevent, 230 

ACT of 1827, entitled " Of moneyed corporations," . . 1-17 
of 1827, entitled " Of general powers, &c. of corpora- 
tions," 24-29 

of 1829, caUed the " Safety Fund Act," . . . 29-39 
of 1830, called the " Restraining Act," . . . 39-50 
of 1830, proceedings against corporations in equity, . 50-75 
of 1830, proceedings agdinst corporations in courts of 

law, 240-247 

of 1838, called the General Banking Law, . . .81, 211 
of 1840, declaring the issue of certain bills or notes 
by banking corporations, &c. to be a misdemeanor, . 114, 174 
ADJUDICATIONS, digest of, relating to the General Bank 

Act, &c 297-325 

AGENTS to examine banking corporations, how appointed, 

149, 150, 183, 200-203 
powers and duties of, and expenses how paid, 150, 200, 201 

for redemption of circulating notes, how appointed, 

109-112, 186-191 
ASSESSMENT of taxes on banking corporations, . . . 150, 224 
See Taxes. 



328 INDEX. 

ASSIGNMENTS by moneyed corporations, in certain cases, 

prohibited, 6, V, 8 

made by, when insolvent, with intent to give a 

preference, invalid in law, . . ■ . 8, 9 n. 
See Conveyance, Transfer, Payment, Lien, Se- 
curity. 
ASSOCIATIONS under the general banking law, adjudged 

to be "moneyed corporations,'' . 96, 97 n., Ixi, Izii 
also to be bound and affected by aU general 

statutes relating to such corporations, . 96, 97 n., Ixii 

to be banking corporations with limited powers, . 97 n. 

to have no power to traffic in state stocks, . 97 n., Ixiii 

term defined to include individual bankers, . . 174 

See Banking Corporations. 

BANKS, Public, when first established vi 

1153, Bank of Venice, ...... vi 

1694, Bank of England, vi 

1695, Bank of Scotland, yii 

1781, Bank of North America, vii 

1783, Bank of Ireland vii 

1791, Bank of the United States, .... vii 

1791, Bank of New York iiv 

1803, Bank of France, vii 

Chartered by the State o/Nm Torlc — 

from 1782 to 1829 , 284, 286 

from 1829 to 1888, 286-289 

organized under the general banking law from 1838 to 

August 1855, 289-294 

history of New York kffialation on the subject of 

banks and banking, from 1781 to 1838, . . . vii to lix 

BANKING, Origin of, v 

unauthorized by law, prohibited, .... 39-49 
See Eestraining Acts. 
BANKKUPTCIES of corporations. 

See Fraudulent Bankruptcies. 
BANKING CORPORATIONS, how organized under the 

general banking law 91 



INDEX. 



329 



Pago. 



91 
91 

91 

97 n. 

92 

!, 93, 94 

94, 199 

94 



BANKING COEPORATIONS— continued. 

any number of persons may associate, 
to establish ofSces of discount, deposit, and cir- 
culation, 

capital stock not to be less than $100,000, 
have no power to traflSc in state stocks, 
such persons shall make a certificate, . 
contents of such certificate, . 
where such certificate shall be filed, 
copies of such certificate may be used as evidence, 
securities to be deposited with Comptroller to 
the amount of $100,000 before commencing 

business, 91, 114 

express powers of such corporations, . . 82, 94, 95, 24 
adjudged to be moneyed corporations, . . .96, 97 n. 
shares in, to be deemed personal property, . . 96, 97 

to be transferable, &c., 96 

no change to be made in articles to impair rights, 

&c. of creditors, 

power to increase capital may be reserved by the 

articles, 

contracts by, how to be signed, .... 

suits, &c., how to be brought, &c., . . 98 n., 125-127 
actions against such corporations, how main- 
tained, . . ... . . 98 n., 99 

shareholders not personally liable for debts of 
such corporations, . . .... 

except debts contracted after Jan. 1st, 1850, 
such corporations may hold real estate for certain 

specified purposes, [See Seal Eatate,'\ 
when chancellor may order an examination, 
dividends, provisions as to, . . . . 2, 3, 4, 104 

if any part of capital withdrawn, no dividends to 

be made until deficit be made good, . . . 104 

damages on protested " circulating notes," . 105 n., 190 
duties of president and cashier, .... 105 



98 

98 
98 



125-127 

99, 100 
155 

100, 101 
101 



S30 INDEX 

Puge. 
BANKING CORPORATIONS— continued. 

power to remove president, &c. at pleasure, . 95 
when banking eorporations may relinquish busi- 
ness, 133 

subject to taxation, 150, 224 

may le proceeded agaimtfor the following musei — 
for violations of provisions of the general 

banking law, '58, 104 

for making dividends in certain cases, . . 104 

for violations of any other statute binding 

upon them, 58 

for neglecting to m^ke quarterly reports, . 140, 149 
\i'vD&(ii.^eD.i, Oil unahle to pay their dehtB, . 58, 59 n. 
if default be made in payment of any debt or 

liability contracted a/icj-Jan.lsi, 1850, 155, 158, 159 
if not " clearly solvent," the judge to make 
an order declaring the corporation vmol- 

•cent, 159, 160 

Penalties imposed as follows — 

for violating § 6 of the Restraining Act, . 43 

for violating §§ 8 and 10 of Restraining Act, 47, 48, 49 
for violating any of the provisions of the acts 

concerning /omp'ji lanJc notes, . . . 108, 195 
for neglecting to redeem their circulating 

notes, 110 

for issuing bills or notes in violation of the 

Act of May 14th, 1840, .... 114,174 
for neglecting to make quarterly reports, 

140, 149, 183, 196 
for neglecting to keep a book containing 

names, &c. of shareholders, . . . 157 

for a refusal to exhibit such book, . . 157 

for re-issuing circulating notes of incorporated 
banks after a certain time in certain cases, 197, 198 
See Associations, Officers & Directors, Injunc- 
tion, Receivers, Chancellor, Stockholders, act 
to enforce responsibility of. Post Notes. 



INDEX. 331 

BANK BILLS of foreign banks under $5, act prohibiting, 

repealed 206 

See Foreign Bank Notes, Circulating Notes, Post 
Notes. 
BANK NOTES, Act of 1830 concerning, .... 75 

See § 31 General Banking Law, p. 105. 

redemption of, 109-112, 186-191 

See Circulating Notes, Post Notes, Foreign Bank 

Notes. 

BANK DEPARTMENT, an act to estabUsh, . . . 178-185 

charged with the execution of all laws relating to 

banks 179 

chief ofBcer, a superintendent, .... 179 
how appointed, term of office, &c., . . 179 
powers of superintendent, . . . 180 
to hold in custody bank plates, <fec., . . 181 
expenses of department, how paid, . . . 181, 182 
§ 14: of general banking law to apply to superin- 
tendent, . _ 91,182,183 

superintendent to fix the day for quarterly bank 

reports, 183 

mortgages, how to be held by him, . . . 184 
annual reports of superintendent, . . . 184 
BANK OF ENGLAND prohibited from trading, . . ix n, 83 n. 
issue department separated from ianJcing depart- 
ment, 84 n. 

design of such separation, 84 n. 

issues of, secured by gorernment debt, . liii n., 84 n. 
See prohibitions against trading, in charters of the 
banks of Scotland, Ireland, France, and of the 
United States, pp. ix n., xiii n. 

See Trading, Mercantile Traffic. 
BANKING POWERS, first legislative specification of, in 

1825, xxvii 

not specified in early bank charters, . . . xvi 

enumerated in the statute of 1827, ... 26 



332 INDEX 

• Pago. 

BANKING POWERS— continued. 

enumerated in the Restraining Act, of 1830, . . 40 n. 

in Safety-Fund bank charters, . . . 95 n. 

in the General Banking Law, ... 94, 95 

BANKING SYSTEMS of New York. 

first iyitem from 1791 to 1829 xiv to xliii 

charter of Bank of New York, 1791, is a model of 
bank charters prior to 1825, .... xiv-xvii 

leading features of bank charters prior to 1825, . xiv-xyii 

these charters contained no specification of bank- 
ing powers, xvi 

they authorized an issue of notes to tlvree times 

the amount of capital, xxxvi 

and required only a small part of the capital to be 
actually paid in before issuing notes. 
(See Bank Charters 'prior to 1829.) 

from 1791 to 1825 the legislature relied upon pro- 
hibitory clauses in each charter, . . . xvi 

all these contained a prohibition against trading 
by banks, xri 

Restraining Act of 1804 guaranteed to banks a 

monopoly, xvii 

Restraining Act of 1818 further guaranteed this 
monopoly, xix 

main provisions of early bank charters derived 
from charters of Bank of England and Bank of 
the United States, xx 

banks chartered in New York from 1782 to 1829, 284, 285 

means employed to obtain lanJc charters in 1799, 

1805, 1812, &c., xxi to xxv 

Spencer's report (1825) on certain inswrance com- 
panies exercising iunhing powers by loaning 
bonds, &c., xxiv 

Spencer's bill of 1825 to prevent fraudulent ianh- 
rupteies by corporations, xxv 

this was a statute of lankruptcy applied to corpo- 
rations xxvi 



INDEX. 333 

Page. 
BANKING SYSTEMS— continued. 

in 1825, the legislature for the first time specified 
in bank charters, banking pcnoera, . . . xxrii 

in 1826-7, certain insurance companies assumed 

the exercise of banking powers, . xxviii to xxxy 

in 1826-7, officers in these insurance companies 

were indicted, xxix to xxxt 

these criminal prosecutions were generally known 

as the "conspiracy trials," .... xxix 

" Life & Fire Bonds," adjudications upon, xxx to xxxv 

1827, Governor Clinton, in his message, recom- 
mended further restrictions on banks, xxxv to xxxvii 

1827, the legislature adopted a stringent code of 
statute regulations to govern " moneyed corpo- 
rations," which included inmrance companies 
(§§ 51, 52, p. 23), xxxvii 

this code prepared by Revisers familiar with the 

disclosures made by the "conspiracy trials," . xxxviii 

main objects sought to be attained by this code of 

1827, xxxix to xl 

See this code (Revised Statutes), pp. 1-28. 

the code of 1827 contained onerous provisions in 
relation to directors, &c., 10-13 

1829, Governor Van Buren, in his message, rec- 
ommended a modification or repeal of some of 
the restrictions in the code of 1827, . xli to xliii 

1829, t?ie second, or safety-fund, system, . . . xliii 

leading features of this system xlv, xlvi 

it created a " bank fund," xlvi 

it established a board of Bank Commissioners, . xlvi 

it modified certain provisions of the code of 1827, 

10-13, 36, 37 

charters under it specified the banking powers 
granted, xlv, 95 

and contained a prohibition against trading by 

banks, xlv 



334 INDEX. 

Page. 

BANKING SYSTEMS— continued. 

banks under it were prohibited from issuing notes, 

&c., on time, xliv, 38 

■were also prohibited from exercising corporate 

powers not expressly granted, . .• . . 25 

were subject to inspection by the Bank Commis- 
sioners, xlvi, 34 

were prohibited from making loans, &c., exceed- 
ing twice & a half their capitals, ... 36 

were forbidden to have bills in circulation exceed- 
ing twice their capitals, ..... 36 

were forbidden to make loans until the whole 

capital was paid in 38 

banks chartered under the safety-fund system 

from 1829 to 1837 284, 285 

how this system worked, xlvi 

1837, all the safety-fund banks in the State sus- 
pended specie payments xlix 

this suspension sanctioned by the legislature for 

one year, xlix n. 

But see Constitution of 1846, p. 265. 

1837, restraining act so modified as to allow indi- 
viduals to receive deposits, Sec, . . . 49 n. 

this repealing act not to apply to corporations, 

foreign or domestic, 49, 50 n. 

remedies proposed, and theories advocated, by 

McCuUoch and others, 1 to Ivi 

1838, April 16th, a majority of bank delegates 
from eighteen States resolved not to resume 

specie payments before January, 1839, . . xlix, 1 
1838, April 18th, the legislature passed the gene- 
ral ianJcing law, ...... 1, 81 

1838, the third, or existing banJcing system : 

distinctive principles of this system, . . . Ivii to lix 
it separates the issue from the hanhing depart- 
ment 82, 83, 84 n., 91 n. 



INDEX, 335 

Page. 
BANKING SYSTEMS— continued. 

it requires ample security for all bank issues, 265, 81, 82 

it authorizes the issue of only a certain Tdnd of 
promissory notes, 82 n. 

it makes the issue of post notes a misdemeanor, . 114 

iefore any notes are given out by the issue de- 
partment, securities must be pledged for their 
redemption, 81, 82 

it authorizes any number of corporations to be 

formed, . 91 

it specifies the ianMng powers which such corpo- 
rations may exercise, 94, 95 n. 

it authorizes each corporation to fix for itself its 
name, its capital, its location, and the period 
of its corporate life, Ix, 92, 93, 94 

it requires an actual deposit of $100,000 in se- 
curities before cfMnTOeracinj' banking business, . 91,114 

banks under this system subject to all general 
laws relating to "moneyed corporations,'' &c., 

96, 97, n., Ix to Ixiii 

safety-fund and general-law systems contrasted, . Ivii 

banking corporations organized from 1838 to 1855, 289-295 
BILLS OF EXCHANGE, acts in relation to, . . . 253-260 

form a large part of the circulating mddium, 300, 301 n. 

amount in circulation in Great Britain, . . 301 n. 

bankers' bills and mercantile bills, difference be- 
tween, 308 n. 

fictitious bills, described by McCuUoch, . . 803 n. 

" drawing & redrawing," described by Adam 
Smith, ...... 301 n., 302, 303 

"raising money by circulation,'' described by 
Adam Smith 301 n., 302, 303 

history of a Scottish Bank of 1 V69, by Adam Smith, 303 n. 

bills on time, or payable with interest, issues of, 
by banking corporations, prohibited, . . 38, 114 

unless drawn on foreign countries, \^Act of 1850,] 1Y4 



336 



INDEX 



BILLS OF EXCHANGE— continued. 

damages on non-payment of bills, 
on bills on certain Northern and Eastern States, 
" " on certain Southern and Western States, 
" " on other States and places on this con 
tinent ....... 

on bills on any person or place in Europe, 
damages to be in lieu of interest and charges, 
when no reference to rate of exchange shall be 

made, 

otherwise when payable in foreign currency, 
for non-acceptance of bills, 
by whom alone damages shall be recovered, 
BOARD OF DIRECTORS, quorum of, . 

previous resolution of, necessary to authorize 

certain transfers, 

See Gillei m. PMlUpa, p. 823. See OfBcers & 
Directors. 
CHAN'CELLOR shall have power,— 

to restrain any corporation from exercising a franchise 

not granted to it, 

from doing business, not authorized by charter, 

to restrain individuals from exercising corporate rights 

not granted to them, 

when such injunction may be issued, 
shall have jurisdiction, — 

over directors of corporations, 

to compel them to account for corporate funds, . 

to decree payment of property wasted, 

to suspend officers in cases of abuses, 

to remove officers for misconduct, .... 

to direct new elections, 

to set aside alienations of property made contrary to 

provisions of law, 

to set aside like alienations made for purposes foreign 
to lawful business of the corporation 



Page. 

256, 257 
256 
256 

256 

. 256,25T 

257 

257 
257 
257 
257 
27 

8n. 



51 
61 

51 
52, 58, 59 

52 
63 
53 
63 
63 
53 

63 

63 



INDEX 



337 



CHANCELLOR ihall have jurisdiction — continued, 
to restrain such threatened alienations, 
preceding powers how to be exercised, 
when corporate property may be sequestered, 
upon final decree, how distribution shall be made, 
certain acts to be deemed a surrender of corporati 

rights, &c 

certain omissions and acts to dissolve a corporation, 
if insolvent, or unable to pay its debts, a corporation 

may be enjoined, 

it may be enjoined for violation of its charter. 

See also § 18 Safety Fund Act, p. 34. 
or for a violation of any law binding upon it 
See § 18 Safety Fund Act, p. 34. 
See Banking Corporations, Injunction, Insolvency. 
CHANGE OF PLACE of business by banliing corporations, 
special acts authorizing, .... 
See Individual Banljers. 
CHARITABLE INSTITUTIONS, dividends on stocks held by. 

Act in relation to, 

CHARTERS, reservation of power to repeal, 

of Bank of England 1694, prohibitions in, . 
of Bank of North America (1781, 1782) what prohibi- 
tions and restrictions in, were omitted, . 
* inserted in the Pennsylvania charter of 1787, 
of Bank of the U. S. 1791, prohibitions in, . 
of Bank of New York 1791, prohibitions in, 
of Banks of France, Scotland, and Ireland, prohibi 

tions in, • . . . 

leading features and provisions in New York bank 
charters, prior to 1825, ... 

how changed in 1825, 

of safety-fund banks, how framed, from 1829 to 1838 
distinctions between safety-fund bank charters and the 
provisions of the general law o/1838. 

See Banking Systems. 
22 



54 
56 
57 
58 

58 
68 

58 
58, 104 

58 



92 n. 
XXV, 92 n 

231 

231 

27 

ix n. 

viii 

xi 

xiv 

Xtin. 



XIV 

xxvii 

xlv 

Ivii 



338 INDEX 

Pago. 
CHARTERED BANKS, special provisions as to, . . 171, 172 

upon expiration of their charters may organize 

under the general law 171 

registered notes may be issued to, . . . 154 

may purchase certain stocks, &c., . . . 172 

certain notes of, to be redeemed and destroyed, . 137 

may hold certain real estate, .... 172 

See Banking Corporations. 
CIRCULATING NOTES, issued by Banking Corporations:— 

to be received /toot the Comptroller, ... 81, 82 
to be countersigned and registered by Comptroller, 81, 82 
to be payable on demand and without interest, 38, 82, 83, 

114, 174 
to be payable at bank's place of business, . 82-85,105 
to be stamped on their face, "secured by pledge 

of public stocks, &c." 88 

to be signed by the president, or vice-president, 

and cashier, 98 

"ample security" for their redemption in specie, 

must be required by the legislature, . . 265 

what securities may be taken, . . . 82 88 89 

what mortgages may be taken, ... 88 153 184 
no mortgage exceeding $5,000 can be received, . 153, 184 
what state stocks may be pledged, 82, 113, 142, 153, 154, 

170, I7l 
pledged securities, when to be sold, . . . 89 90 
holders of bills secured a ^re;4r«nc«, . . . 265 

plates, dies, &c., to remain in custody of Comp- 
troller or Superintendent, . . . . 90 138 181 
penalty on Comptroller for violating § 14 of the 

general law, 91_ i82, 183 

issue of notes, payable on time, prohibited, . 38 114 

issue of notes or bills, payable with interest 

prohibited, , 38^ 114 

issue of bills, &x<x.^i foreign bills of exchange, for- 

I'idden, 38_ n^^ 174 



INDEX 



S39 



Page. 

CIRCULATING NOTES— continued. 

issue of notes or bills, by banking corporations not 

specially authorized by law, prohibited — § 3, . 25 

See §§ 3, 6, of Restraining Act, pp. 41-44. 
bills less than $1000 to be payable at the office of 

the bank, 75, 105 

when to be deemed payable at the bankinghouse, 75, 105 
mutilated may be exchanged, . . . . 115 

less than $1 forbidden, 44, 45 

how demanded and protested, .... 187-190 
when interest may be recovered, .... 187 

when interest shall not be recovered, ... 188 

in what manner protested, 188, 189 

damages for non-payment of, ... . 190 

aggregate amount in circulation, August 1855, . 294 

See Post Notes, Bills of Exchange, Drawing and 
Re-Drawing. 
CLEARING HOUSE in the city of New York, account of, . 266-277 

constitution of, 278-282 

names of Associated Banks, .... 282, 283 

See New York Clearing House. 
CLINTON'S (Gov.) views on banks and banking, 1827, xxxv to xxxviii 
COLLECTION OP DEBTS against corporations, Act to 

facilitate, 232 

COMPTROLLER, powers and duties of, relative to securities 

pledged for "circulating notes," . . . 81-91,180 
penalty on, for violating § 14 of the general banking 

law, 91, 182, 183 

See Superintendent. 
CONSPIRACY TRIALS of 1826 and 1827, history of, &c., . xxix 

See Banking Systems. 
CONSTITUTION of 1821, provisions of, as to the creation of 

corporations by the legislature, . . . 297 n. 
of 1846, provisions of, as to corporations, . . 264,265 
the term " corporation," defined by, . . . 264 

corporations to be formed under general laws, . 264 



340 INDEX. 

Page. 
CONSTITUTION of 1846— continued, 

not to be created by special charter, . . . 264 

the legislature shall hate no power 
to pass a special charter for banking purposes, 265 

nor to pass a law sanctioning a suspension of 

specie payments 265 

the legislature shall provide 
for the registry of aU biUs or notes, put in 

circulation as money, .... 265 

and shall require ample security for their 

redemption in specie . .... 265 

stockholders shall be liable for certain debts, 265 

bill holders to hare a preference in cases of 

insolvency, 265 

CONTEMPLATION OF INSOLVENCY, conveyances in, by 

moneyed corporations invalid, ... 8, 9 

See Conveyances, Transfers, Insolvency. 
CONTRACTS by banking corporations to be signed by the 

president or vice-president, and cashier, . . 98 

Dy a corporation unauthorized by its charter, void, 52, 53, 54 n. 
CONVEYANCES by a moneyed corporation, when insolvent, 

with intent to give a preference, invalid, . . 8, 9 

in contemplation of insolvency, with like intent, 

invalid, 8, 9 

See Brouwer v. Harleck, p. 9 n. 
unauthorized by a previous resolution of the board 

of directors, forbidden in certain cases, . . 7 

See Qillet v. Phillips, p. 323. 
Blunt y. Hanna, p. 7 n. 
for benefit of a corporation, must be directly to it 

by name, except, &c., 6 

But see § 24, sub. 4, as to real estate, p. 100, 101. 
See Transfers, Lien Created, Security Given, Pay- 
ment, Assignment, Real Estate. 
CORPORATION, the term defined by the Constitution of 

1846 265 



INDEX. 341 

Page. 

CORPORATION, the term defined— continued. 

by Bronson, J., 304, 305 

by MarshaU, C. J., 305 

byKyd 305 

by Grant, 305 

distinction between corporations and partner- 
ships, ,306 

"moneyed," defined by Revised Statutes, . . 23 

has such powers as are expressly granted, . . 25 n. 
and such incidental powers as are neeessa/ry to the 

exercise of its express powers, ... 25 

the exercise by, of powers not granted prohibited, 25 
shall not by construction of implication possess 

tanking powers, 26 

forbidden, by the act of 1850, thereafter to inter- 
pose the defence of usury, .... 264 

voluntary dissolution of, 64-75 

proceedings against, in equity, .... 50-64 

proceedings against, in courts of law, . . . 240 

foreign, proceedings against, .... 242-253 
not estopped from denying its power to make a 

contract, 53 n. 

unless expressly authorized by law, 

forbidden to exercise banking powers, . . 26 
or to employ its efiects for the purpose of 

issuing notes, &c., 41 

or to keep any office for the purpose of re- 
ceiving deposits, &c., .... 43 
or for the purpose of issuing notes, &c., . 42, 48 n. 
See Banking Corporations, Restraining Acts. 
CREDITORS of moneyed corporations, regulations to secure 

the rights of, 1-17 

bill holders, in certain cases, to have a preference, 265 
stockholders to be individually responsible, in 

certain cases, 265 



342 



INDEX. 



Page. 



COUNTERSIGNED NOTES, aggregate amount in circula- 
tion in August, 1855, . . . . . 
See Circulating Notes. 
DAMAGES on protested circulating notes, .... 
on protested bills of exchange, .... 
See Bills of Exchange. 
DEBTS of certain banking corporations, stockholders liable for, 
against corporations, an act to facilitate the collection of, 
DECISIONS on § 4 of the act of May Uth, 1840, 
on § 1, General Statute (1 R. S. 589), . 
on §§ 8, 9, General Statute (1 R. S. 591), 
on the restraining acts, 
relative to the General Banking Law, 
relative to Receivers of corporations, . 
as to unauthorized contracts made by corporations, 
as to proceedings against corporations, &c. 
DEFINITIONS of certain terms used in the Revised Statutes, 
term " moneyed corporation " defined, 

term " directors," 

term " effects," 

term " evidence of debt," .... 
term "corporations," as used in the Act of April 
6th, 1850, to prevent corporations from inter 
posing the defence of usury, 
term " corporation," as used in the Constitution 

of 1846, 

term "association," as used in the act of April 

11th, 1849, .... 
term "stockholder," as used in the act of April 

5th, 1849, 

a corporation, definitions of, by jurists and others, 
partnerships and corporations, distinction be- 
tween, 

See Corporation, Banking Corporations. 
DIGEST OF LEADING DECISIONS relating to General 

Bank Act, 297-325 



294 

190 
256, 257 

155 

232 

114-122 n. 

. 2, 3, 320 

7, 8, 9 n., 323 

42 n., 48 

297-325 

57 n. 

51-55 n. 

74, 75 n. 

23,24 

23 

23 

24 

24 



264 

264 

174 

155 
304, 305 n. 

306 n. 



INDEX 



343 



" DIRECTORS," as used in Revised Statutes, defined, . 

as to election of, 17- 

penalty on, for violating certain sections of Revised 

Statutes, .... 
penalty on, for purchasing notes of the corpora- 
tion for less than amount due, 
penalty on, for discounting notes in certain cases, 
penalty on, for violating § 3 of Restraining Act, 
trustees of creditors in certain cases, . 
See Officers and Directors. 
DISSOLUTION {Voluntary) of corporations, 

when directors may apply for dissolution, 

contents of application, 

order to show cause, when to be entered, 

when coi'poration to he dissolved, 

who may be appointed receivers, 

rights, interest, and authority of such receivers, 

such Receivers to have all the power of trustees of 

estates of insolvent debtors, 
certain sales, &c. declared void, .' 
debtors to account to Receivers, . 
Receivers to have power to refer controversies, 
Receivers' commissions, ... 70, 
order of payment of debts, .... 
Receivers subject to control of Court of Chancery, 
decrees and orders subject to appeal, 
certain corporations excepted, 

See Corporations, Receivers. 
DIVIDENDS by banking corporations, — 
to be made from profits only, 
how profits are to be calculated, 
surplus profits, how ascertained, 
losses, how to be charged, . 
how to be declared on stock owned by the State, 
or literary, &c. institutions, 



Page. 
23 

•23, 146 



10 

16 
16 
41 
28 

64-77 
65 
66 
66 
67 

67,68 
68 

68 
69 
69 
69 
134, 135 
71 
73 
74 
74 



5 
5 
5 
5 

231 



344: INDEX. 

Page. 

DIVIDENDS by banking corporations — continued. 

not to be made if any part of capital has been 

withdrawn, 104 

provision if capital is reduced, &c., . . . 140 

if made in such a case, the Chancellor may order 

their affairs to be closed, ..... 104 

"DRAWING & RE-DRA:W"ING " of biUs, described by 

Adam Smith 301 n. 

See Bills of Exchange, Fictitious Bills. 
DISTRIBUTION of funds by the Comptroller, . . . 175-177 
"EFFECTS," the term defined in Revised Statutes, . . 24 

"EVIDENCE OP DEBT," the term defined in Revised 

Statutes 24 

EXERCISE of unauthorized banking powers prohibited, . 26 

EXPRESS GRANT of banking powers necessary to their 

exercise by a corporation, .... 26 

EXPRESS POWERS of banking corporations, . . .94, 95 n. 

of safety fund banks, 94, 95 n. 

See Banking Powers. 
FICTITIOUS BILLS, description of, by M'CuUoch, . . 303 n. 
are a device for obtaining loans, . . . 302, 303 n. 
have no effect in transferring or settling debts, . 303 n. 
the system oi drawing & re-drawing is a mode 

of borrowing money, : . . . 302, 303 n. 
fiatitioiis MIU balance each other, . . . 303 n. 
those drawn by London on Glasgow, are exactly 

equal to those drawn by Glasgow on London, . 303 n. 
See Bills of Exchange, Drawing and Re-drawing, 
Raising Money by Circulation. 
FOREIGN BANK NOTES, acts concerning, . . 107-109, 193 

See Bank Bills. 
POKEIGN CORPORATIONS, 

are within the prohibitions of the Restraining 

Act, §§ 3, 6, . . . . * . .41, 42, 50 n. 

may prosecute suits, &c 240 

upon giving security for costs 240 



INDEX. 345 

Page. 

FOREIGN CORPOEATIONS— continued. 

when they shall not maintain an action, . . - 240 
attachments against, . . . 242, 243, 246, 247, 253 

in what courts suits may be brought, . . . 262, 253 

by whom suits may be prosecuted, . . . 252, 253 

in what cases suits may be brought, . . . 252, 253 

Act of May 14th, 1840, as to proceedings against, 246, 246 

Act of April 11th, 1842, as to suits against, 247, 248, 249 

Act of May 13th, 1845, as to suits against, . . 249,250 

Act of Feb. 21st, 1848, as to suits against, . . 251 

Act of March 15th, 1849, as to remedies against, 252 

actions against, under the Code of Procedure, . 253 
FRAUDULENT BANKRUPTCIES of corporations. Act of 

1825, to prevent xxv 

this was a statute of hanleruptcy applied to cor- 
porations, xxvi 

English bankrupt laws did not extend to corpora- 
tions, xxvi 

provisions of the Act of 1825 re-enacted in Re- 
vised Statutes, xxvi n. 

See Statute Regulations of 1827, p. 1-28. 
FRAUDULENT ISSUES of corporate bonds or stock, de- 
clared to be a fehny, 207, 208 

GENERAL BANKING LAW, as originally passed {with 

notes and references'), . . . 81-107 

as altered by subsequent legislation, . 211-223 

GENERAL LIABILITIES of every corporation, . . . 24 

Prkileges of every corporation, .... 24 

Powers of every corporation, .... 24 

INCORPORATED BANKS, Act as to withdrawal of their 

circulating notes after their special charters 

have expired, 197 

their power to hold real estate, .... 172, 100 
INDIVIDUAL BANKER, 

must file a certificate stating residence, . . 144 

penalty for neglect 144 



346 



INDEX 



Page. 



INDIVIDUAL BANKER-continued. 

to deposit securities to the amount of $60,000, 
to be banks of discount and deposit, as well as of 

circulation, 

to transact business at place of residence specified 

in the certificate, 

notice of change of residence to be filed, 

penalty for neglecting to make reports, 

in whose name business shall be conducted, 

sale of banking business prohibited, 

to be individually liable for circulating notes, 

notes, how signed, 

to report names of persons interested with him, 
penalty for not making such report, 
persons interested to file a certificate, . 
persons interested to be jointly liable for debts, 
circulating notes to express individual liability, 
circulating notes of, to be payable on demand, 
and without interest, 

subject to taxation, 

See Banking Corporations. 
INJUNCTIONS against moneyed corporations, — 

may be issued to restrain any corporation from 

exercising a franchise not granted, . 
to restrain individuals from exercising corporate 
rights not granted to them, .... 
when to be issued, . . . .52, 68, 89, 159, 160 
to prevent illegal alienations of corporate property, 54 

to prevent directors from using corporate funds 

for purposes unauthorized by the charter, . 55 n. 
in case of insolvency, to prevent officers, &c. irom 

exercising corporate rights, &c. . . 58, 169, 160 
( if corporation is unable to pay its debts, . . 58 
to restrain proceedings at law against corpora- 
tions in certain cases, 64 



143 

152 

152 
144 
143 
143, 204 
204 
204 
204 
143 
143 
203 
208 
204 



82-85, 114 
150 



51 



51 



INDEX 347 

Pago. 
INJUNCTIONS against moneyed corporations — continued. 

may be issued upon the application of share- 
holders in certain cases 55 n., 59, 160 

See Chancellor, Banking Corporations, Insolvency. 
INSOLVENCY of moneyed corporations, regulations to pre- 
vent, 1-17 

object of these regulations, as stated by the Reviaors, xxxix, 9 n. 
if insolvent, corporation may be enjoined, ... 58 

or if unable to pay its debts, 58 

or for violations of its charter, 58, 104 

conveyances by, when insolvent, with intent to give a 

preference, invalid in law, 8, 9 

insolvency defined by Allen, J., in Browjoer v. Ear- 

ieci, 9 n. 

if not " clearly solvent," the judge shall, by an order, 

declare a corporation to be insolvent, . . . 160 
See Banking Corporations, Injunction, Chancellor, 
Conveyances, Insolvent Corporations. 
INSOLVENT CORPORATIONS with banking powers, pro- 
ceedings against, 58, 158-160 

if insolvent, or unable to pay their debts, . . 58 

for violations of any provisions of their charters, . 58, 104 
for violations of any other law binding upon them, 58 

insolvency defined by Allen, J., in Browwer v. 

Harbeclc 9 n. 

upon whose application injunction mayisme, 56, 59,158-170 
for what coMsea injunction may issue, 58, 59, 104, 140, 149, 

155, 156, 159, 160 
a Receiver may be appointed, . . .59, 158-170 
powers and duties of Receivers, . . 60,68,161-170 
bill holders to have a preference, . . . 265 

directors, &c., may be made parties in certain 

cases, 61 

jurisdiction over directors, &c., .... 61 

proceedings on bills filed by creditors, . . 61 

decree when corporation is insolvent, ... 62 



348 



INDEX. 



INSO LVBNT CORPORATIONS— continued, 
distribution of corporate property, 
liabilities of stockholders, .... 
liabilities of directors, how enforced, . 
discoyery by a corporation may be compelled, 
when oflBcers compelled to answer, 
answers of officers, how far evidence, . 
answers, in what cases only, compelled, 
persons compelled to answer exonerated from 

prosecution, &c., . 
when proceedings at law shall be stayed, 
certain corporations excepted, &c.. 
See Banking Corporations, Injunction, Chancellor. 
INSPECTORS of election of directors, how chosen, 

power to supply vacancies, . 

officers not to be inspectors, 

oath of inspectors, 

qualification of voters, 

form of oath to be administered 

when votes shall be rejected, 

not to vote on hypothecated stock, 

any person challenged shall take an oath, &c.j 

affidavits to be annexed to proxies, 

certain by-laws invalid, 

books of transfer to be kept, 

married women may vote in certain cases, . 

penalty for refusing inspection of books, . 

remedy for persons aggrieved by an election, 

duty of Supreme Court, .... 
INTEREST OF MONEY, an act in relation to, . 

rate at which discounts may be made by banks 

subject to the act of 1829, 
rate of interest allowed to incorporated banks by 

the act of 1817, 
notes or bills issued by banking corporations pay- 
able with interest prohibited, 



Page. 



62 
62 
63 
63 
63 
68 

63 
64 
64 

18 
18 
18 
19 
19 
19 
19 
19 
19 
20 
20 
21 
20 n. 
21 
21 
22 
260-262 



37 



288 n. 



38, 114 



INDEX 



349 



INTEREST OF MONEY— continued. 

recovery of, on protested circulating notes, regu- 



lated. 



187, 188 



when interest shall not be recovered on such 

notes, 

for the purpose of calculating interest, a month 
to be considered the twelfth part of a year, and 

to consist of 30 days, 

interest for less than one month to be estimated 
by the proportion which the number of days 

shall bear to 30, 

how interest shall be calculated in certain cases, . 
See Usury. 
ISSUES by banking corporations, — 

under exclusive control of the comptroller or superin- 
tendent, 

must be payable on demand, 

must be payable without interest, 

must be payable at bank's place of business, 

must be secured by government stocks, &c., 

must be stamped by the government, 

by Bank of England, secured by a debt of the English 

government liiin., Sin. 

See Circulating Notes, Post Notes, Bills of Exchange, 

Loans & Discounts, Fictitious Bills, Banking Systems. 

ISSUES, unauthorized, of corporate bonds, &c., declared to 

be a felony, 207,208 

JUDGMENT SUFFERED by a moneyed corporation when 
insolvent, with intent to give a preference, in- 
valid, 

See Conveyances, Transfers, Payments, Lien Ore 
ated. 

HOLIDAYS, an act to designate, 

HUNT'S CASE, report and decision in, ... . 
LEADING DECISIONS, relating to the general banking law, 

and the powers of corporations formed under it, . 297-325 



188 



261 



261 

261 



81-91, 186-139 

38, 82, 114 

38, 114, 174 

82-85, 105 

82, 88, 265 



8,9 



259 
44 n. 



350 INDEX. 

Pago. 
LIABILITIES (general) of every corporation, ... 24 

certain liabilities, stockholders liable for, . . 155 

LIENS CREATED by a moneyed corporation, when insolvent 

with intent to prefer, invalid, .... 8, 9 

in contemplation of insolvency, with like intent, 

invalid, 8, 9 

See Conveyances, Transfers. 
LIFE & FIRE BONDS, for what purpose issued, . . . xxxi 

form of these bonds, xxxi. 43, 122 

powers of Life and Fire Ins. Co xxxi 

adjudications upon, xxxiii 

LITERARY INSTITUTIONS, stocks held by, act in relation 

to dividends on, 281 

LOANS, when to be called in, 6 

LOANS AND DISCOUNTS, limited by Revised Statutes to 

three times the capital paid in, ... . 4 

by the Safety-Fund Act, to twice and a half the 

capital paid in, 36 

but this act required the whole capital to be 
actually paid in before any discounts, &c. could 

be made 38 

this act also limited the issue of notes to twice the 

capital paid in, 36 

by charters before 1829, debts of banks, over 
deposits, limited to three times capital paid in, 
See Charters. 

See Clinton's message, 1827, p. xxxvi. 
Charters prior to 1829, required only a small per- 
centage on capital to be paid in before issuing 
notes, &c. See Charters before 1829. 
general banking law as amended, requires an 
aggregate capital of $100,000, and a deposit 
with Comptroller of $100,000 of securities before 
commencing banking business, . . . .91, 114 
but the general law only authorizes secured and 
countersigned notes to be loaned, ... 82, 88 
LOSSES, how to be computed 5, 6 



INDEX. 351 

Page. 

MANHATTAN COMPANY, how its charter was obtained in 

1799, xxi, xxii 

MERCANTILE TRAFFIC by Bank of England, forbidden, 

ix n. — xlviii n. 
this bank an engine of state, .... xlviii 

it conducts the banking business of the British 

Government, xlviii 

See Trading, .Prohibition, Charters. 
McCULLOCH, doctrines advocated by, with respect to secur- 
ity for bank issues, li to liii 

"MONEYED CORPORATION," the term defined in the 

Revised Statutes, 23 

shall not be interested in notarial fees, . . 77 

nor in premiums on certain drafts, ... 77 

nor place-moneys in the hands of any one for the 

purpose of discounting, &c., .... 78 

See Corporations, Banking Corporations, Insolvent 
Corporations, Chancellor. 
MORTGAGES, for a greater amount each than $5,000, cannot 

be received by Comptroller, .... 153, 184 

See Circulating Notes. 
NATIONAL BANKS of the U. S.— 

forbidden to trade in any thing, except bullion, &c., xiv 
mercantile traflBc by banks condemned, . . xlviii 
NEW YORK CLEARING HOUSE, account of, . . . 266-267 
average amount of daily exchanges, . . . 276 
mode in which these exchanges are made, . 270-275 
results accomplished by this system of ex- 
changes, ; 275 

some of the advantages of this system, . . 275 

it checks violent expansions, and contractions 

ofloans, . 275 

it compels banks to keep a larger Specie basis, 275 

constitution of the Clearing-House, . . . 278 

names of associated banks, .... 282, 283 
NOTES, issue of, by banking corporations, payable on time, 

or payable with interest, prohibited, . . .88, 114, 174 



352 INDEX. 

Page. 
NOTES— continued. 

giyen in violation of §§ 1, 2, 3 of Restraining Act, void, 41, 42 
for less than one dollar, prohibited, . . . . 16, 44, 45 
See Bills, Post Notes, Foreign Bank Notes, Circulating 
Notes, Bills of Exchange, Fictitious Bills. 
OFFICERS AND DIRECTORS of moneyed corporations, 
penalties on, — 
for violating certain sections of the Revised 

Statutes, 10 

for purchasing notes, &c. of such corporations, 

for less than amount due, .... 16 

for discounting notes refused by directors, . 16, 17 
for refusing to exhibit transfer books, . . 21 

for violations of §3 and§6,oftheRestraining Act, 41, 43, 49 
for issuing or circulating notes, &c. in violation 

of § 4 of the Act of May 14th, 1848, . . 114 

for making false statements, or false entries in 

the books of such corporations, ... 36 

for refusing to exhibit the book containing the 

names, &c. of stockholders, .... IBT 

for willfuUy signing, with intent to issue, false 

certificates of shares, &c 207, 208 

may be decreed to pay over to a Receiver corporate 
funds misapplied, or improperly disposed of, . 10, 233 
PAYMENTS by a moneyed corporation when insolvent, 

with intent to prefer, invalid, .... 8, 9 

in contemplation of insolvency, with like intent, 

invalid, 8, 9 

See Conveyances, Transfers. 
PARTNERSHIPS & CORPORATIONS, distinction between, 306 n- 
PLACE where the operations of discount, &c. are to be 
carried on, to be specified in the Articles of Associa- 
tion, (see p. XXV.) 92 n. 

See Individual Banker, Change of Place of Business. 
PENALTY on every person and every corporation violating 
or assenting to the violation of § 6 of the Restraining 
Act 43,44 



INDEX. 



353 



Page. 



PENALTY— continued. 

on ofScers Tiolating § 4 of the Act of May 14, 1840, . 

for circulating bUls less than one dollar, 

for circulating notes, &c. payable otherwise than in 

lawful money of the U. S 

See OflBcers & Directors. 
POST BILLS, issue of, by banking corporations, prohibited, 

except, &c 88 

See Bills of Exchange, Fictitious Bills, Post Notes, 
Circulating Notes. 
POST NOTES, &c., issue of, by banking corporations or by 

individual bankers, prohibited, . . 88, 114, 174 

decisions as to the issue of, . 26 n., 43-45 n., 116, 117 n. 
forms of, adjudicated upon iy the courts, 

in Atty. Gen. v. Life & Fire Ins. Co , . 43, 122, xxxii 



114 

47 

48 



114, 174 



in Jf. Y. Life Ins. & Trust Co. v. Beebe, 
in Hunts Case, .... 
mSaffordN. Wyckoff, . 
in BanTc of GhilicotTis r. Bodge, . 
in Smith & Warner v. Strong, 
in Swift V. Been, .... 
in Leaviit t. Palmer, . 
in BanJc Commrs. v. St. Lawrence Bank, 
in Tahnage v. Pell, 
in Leaditt v. Yates, 
in Southern Loan Co. v. Morris, . 
in Miller v. Austin, 
POWERS (general) of every corporation. 

See Banking Powers. 
PREFERENCES given by moneyed corporations, when in 

solvent, &c. invalid 

See Conveyances, Transfers. 
PRINCIPLES ADJUDGED by the highest court in the 
State in reference to the general bank law, &c. 
PRIVILEGES (general) of every corporation, 
23 



26 n. 

44, 45 n. 

118 n. 

118 n. 

119 n. 

119 n. 

120 n. 

120 n. 

121 n. 
121 n. 
307 n. 
307 n. 
24,25 



8,9 



Ix to Ixiii 
24,25 



354 INDEX. 

Page. 
PROCEEDINGS against corporations in Equity, ... 60, 66 

at La/vo, . . . 240-247 
See Banking Corporations, Chancellor, Injunc- 
tion. 
PROHIBITION against trading, in all bank charters prior to 

1825, vii-xvii, 83 n. 

omitted in first Pennsylvania charter of the Bank 

of North America, viii 

inserted in the second charter, , . . . xi n. 

inserted in the charters of the two national Banks 
of the U. S., . . . .. . . . xiv n. 

inserted in charters of Banks of England, France, 

Scotland, and Ireland, ix n. 

against the issue of post notes, . . .38, 114, 174 
against the exercise, by corporations, of powers 

not expressly given, &c 25 

against the transfers of corporate effects, in cer- 
tain cases, 6, 7, 8 

See Circulating Notes, Post Notes, Conveyances, 
Chancellor. 
PROFITS, how calculated, preparatory to a dividend, . . 5 

surplus, how ascertained, 5 

PROMISSORY NOTES, Acts in relation to, . . . . 253-260 

See Circulating Notes. 
PROVISIONS of Title II. chap. 18, 1 R. S. 588, apply to 
every moneyed corporation created after Jan- 
uary, 1828 28 

PURCHASERS at Receivers' sales, act in relation to, . . 144 

QUORUM of a Board of Directors, 27 

REAL ESTATE, in what cases banking corporations can 

acquire and hold the same, . . . lOO, 101 n. 
conveyances of real estate to be made to the pres- 
ident, or other officer indicated in the articles, 100, 101 
But see%1 of the general statute, p. 6. See Incor- 
porated Banks. 



INDEX. 355 



" RAISING MONEY BY CIRCULATION," as described by 

Adam Smith, 801 n. 

See Bills of Exchange, Fictitious Bills, Drawing 
and Re-Drawing. 
RECEIVERS of moneyed corporations, — 

their powers and duties, 59, 60, 68, 69, 161-170, 204, 282, 233 
subject to order of Chancellor, . . . -73, 136 

power to refer controversies 69 

may hold real estate, 145 

may sue in their own names, .... 145 

duties as to the allowance and disallowance of 

claims against the fund, . . . . 57 n., 60 n. 
represent the rights of creditors and stockholders, 68, 57 n. 
may repudiate illegal transfers, &c. of corporate 

effects, 57 n. 

suits commenced by a Receiver not abated by his 

death or removal 280 

their powers and duties under the Acts of April 

5th, 1849, and March 15th, 1855, . . . 161, 205 
See Act of April 26th, 1882, pp. 280, 281. 
See Act of Ma/rcTi 19zft, 1852, pp. 232, 233. 
See Insolvent Corporations, Chancellor, Banking 
Corporations, Injunction. 
REGISTERED NOTES may be issued in lieu of unregistered 

notes, 154 

REGULATIONS of 1827 (Revised Statutes),— 

to prevent insolvency of moneyed corporations, . 1-17 

such corporations shall not make dividends, ex- 
cept from surplus profits, .... 3 
nor pay any part of capital to stockholders, . . 3 
nor reduce capital without consent of legislature, 3 
nor discount notes in payment of installments on 

stock, 3 

nor receive notes to enable stockholders to with- 
draw moneys paid for stock, .... 4 
nor apply moneys, except surplus profits, to pur- 
chase shares of its own stock 4 



356 INDEX. 

Page. 
REGULATIONS— continued. 

nor receiye such shares in payment of debts, ex- 
cept, &c 4 

nor receive from other stock corporations in ex- 
change, &c. shares, &c. of such other corporations, 4 
nor make loans, &c. exceeding twice and a half 

the capital, 4, 36 

nor make loans, &c. to directors exceeding one 

third of capital, 4, 5 

See Banking Corporations, Chancellor, Moneyed 
Corporations, Insolvent Corporations, Injunc- 
tion. 
REPORTS to Superintendent of Bank Department, . . 183 

to be made quarterly, 138,183 

New York city banks to publish in addition weekly 

reports, 195, 196 

what such reports shall contain 147, 148 

penalty if not made, 149 

to be published by superintendent, . . . . 139 

RESTRAINING ACT of 1782 (obsolete) 283 

of 1804 (obsolete), 234 

of 1813 (obsolete) 236 

of 1818 (obsolete) 237 

RESTRAINING ACT OP 1880 (Revised Statutes), . . 39^9 

Revisers' notes on 40, 41 n. 

§6 in part repealed, Feb. 2, 1837, . . . 42,49n. 
this repealing act not to apply to foreign corpora- 
tions, . 49, 60 n. 

corporations, unless expressly authorized by law, 
forbidden to employ their effects for the purpose 

of making discounts, &c., § 3, . . . . 41 

or to keep any office for the purpose of receiving 

deposits, &c., § 6, 42 

or for the purpose of issuing evidences of debt, 

&c., §6, 42 

forbidden to issue notes, &c., on loan, or for cir- 
culation as money, § 6, 42 n. 



INDEX. 



357 



llESTRAINING ACT— continued. 

penalties for violations of this act, §§ 2, 4, 7, 9, 11 
decisions of the courts on restraining acts, . 42 
SAFETY-FUND ACT of April 2, 1829, . 

banks whose charters had not expired in January, 

1855 

SECURITIES GIVEN by a moneyed corporation when in- 
solvent, with intent to prefer, invalid, 
in contemplation of insolvency, with like intent, 

invalid, 

See Conveyances, Transfers, Liens Created, Pay 

ments. 
given in violation of § 2 or § 3 of Restraining Act, 

void, 

SCOTTISH BANK, estabUshed in 1769, failed in 1771, his- 
tory of, by Adam Smith, 

See Bills of Exchange. 
SHARES, HYPOTHECATED, when to be sold, . 

of their own stock, moneyed corporations are prohib- 
ited from purchasing, except with surplus profits, . 
SANDPORD, VICE-CHANCELLOR, decision of, on §8, for- 
bidding certain transfers of corporate effects. 
See Gillet vs. Phillips, p, 323. 
SPECIE PAYMENTS, suspension of, in May 1837, . 
sanctioned by the legislature^ one year, . 
the constitution of 1846 takes from the legislature 

' this power, 

STATUTE REGULATIONS OF 1827, 

these regulations took effect Jan. 1, 1828, . 
main objects sought to be obtained by their enact- 
ment, ........ 

two systems of law, applicable to moneyed cor- 
porations, in force Jan. 1, 1828, 
STOCKS of the State of New York only, to be received for 
circulating notes, .... 113, 142, 153, 

ovTned by the State, exempt from taxation, 
23* 



Page, 

41-49 

n., 48 n, 

29-39 

295,296 

8,9 

8,9 



41,42 


303 n. 


6 


4 


7n. 


xlix n. 


xlixn. 


265 


1-29 


xxxviii 



xl 

154, 170 
231 



358 



INDEX. 



Page. 
STOCKHOLDERS of moneyed corporations, statutory regula- 
tions to secure, 1-17 

liable for certain debts 155 

may apply to a Court of Chancery to prevent un- 
authorized use of corporate funds, . . 55, 56 n. 59 
Act to enforce responsibility of, . . . . 155-170 
corporations " issuing ianJi notes, &e." are liable 

for debts contracted after January 1, 1850, . 155 

the term " stockholder " defined, . . . 155 

how exonerated from such liability, . . . 156 

when assignee of stock is liable, . . . 157 

names to be kept in a book, .... 157 

such book to be always open for inspection, . 157 

penalty for neglect, 157 

the book to be presumptive evidence, . . 158 

when plaintiff may enter judgment, . . . 158 

insolvency of corporation when to be declared, 159 

when application for its dissolution shall be 

made, 159 

duty of judge on hearing the parties, . . 159, 160 
when an injunction shall issue, . . . 160 

stockholders may apply for dissolution of the 

corporation, 160, 161 

powers and duties ofReceivers under this Act, 161-163, 205 

162 
162 
163 
163 
168 
164 
165 
165 
166 
166 
265 
166, 167 



securities when to be converted into cash, 
dividend when to be made, 
report as to unsatisfied debts to be made, 
stockholders, list of, to be reported, 
report to be referred to a Referee 
hearing before Referee, how to be had, 
apportionment, when to be reported, 
report of Referee to be filed, 
money how to be divided, 
necessary expenses to be allowed, . 
bill-holders to have a preference, 
dividends not to be delayed beyond one year. 



INDEX 



359 



STOCKHOLDERS— continued. 

surplus assets how disposed of, ... 
limitation and effect of appeals, 
appeals by Receivers, &c., .... 
new apportionment, when to be made, 
securities taken under this act, where to be filed, 
rights of creditors neglecting to present their 

demands, &c 

certain issues of fact or of law to have a 

preference, 

SUPERINTENDENT of Bank Department, 

to have the powers of the Comptroller, 
to be subject to same penalties, &c. 
to hold in custody all bank plates, 
subject to a fine of not less than $5000, and to 
imprisonment for not less than five years, for a 
violation of § 14 of the general banking law, 91, 
See Bank Department. 
SYSTEMS OE BANKING in the State of New York, 

See Banking Systems. 
SUSPENSION of specie payments, the legislature no power 
to pass a law to sanction, .... 

See Specie Payments. 
TAXES on moneyed corporations, 
how stated and collected, . 

duty of supervisors 

duty of collector, .... 
to be paid out of corporate funds, 
proceedings, if taxes cannot be collected, 
when to be reported to State Comptroller, 
duty of Comptroller in such cases, 
duty of Attorney General, . 
powers of Chancellor, 
TIME PAPER, issue of, by banks, prohibited, 

except bills of exchange on foreign countries. 
See Post Notes, Fictitious Bills, Interest 



Pago. 

167 
167, 168 
168 
169 
169 

169 

169 

180 
180 
181 



183, 183 



265 

150, 224 
228 
228 
228 
228 
229 
229 
229 
229 
229 
38, 114 
174 



360 mDEX. 

Page. 
TRADING by banks, except ia bullion, &c. prohibited, 

ix, xi, xvi, xlv, 83 n. 
TKAFFICKING by banks in State stocks illegal, . . . 83 n. 

See Trading. 
TRANSFERS of corporate effiects in certain cases prohib- 
ited, . 6, 7, 8 

See Conveyance, Payment, Assignment, Lien 

Created, 
of corporate bonds or stock, unauthorized, Act for 

the punishment of, 207, 208 

TRIALS (^Conspiracy), history of, xxix 

UNAUTHORIZED BANKING prohibited, : . . . 39-49 
UNCLAIMED DIVIDENDS and deposits, Act in relation to, 173 

USURY, an Act to prevent, ..;.... 262, 263 
all bills, notes, &c. whereby more than 7 per cent, ia 

reserved, shall be void, 260, 262 

the defendant in an action may examine the plaintiff 

as a witness to prove the usury, .... 262 

offenders against this act may be compelled to answer 

any bill exhibited against them 263 

upon bills for relief, not necessary for plaintiff to pay, 

or to offer to pay, interest or principal, . . . 262 

nor shall the court require the payment, or deposit, 
of principal sum, &c., as a condition of granting 

relief, 262,263 

power of the court to declare securities void, and to 

enjoin any prosecution thereon, . . . . 263 

persons violating this act to be deemed guilty of a 

misdemeanor, ...:.... 263 

upon conviction, to be punished by fine, not exceeding 
$1000, or imprisonment not exceeding 6 months, or 

both, 263 

punishment for false swearing by plaintiffs examined 

as witnesses, ........ 263 

corporations prohibited (April 6th, 1850) from there- 
after interposing the defence of usury in any action, 264 



INDEX 361 

Pago. 

USURY— continued. 

the term corporatfon, as used in the Act of April 6th, 
1850, defined to include associations and joint-stock 

companies, &c 264 

VAN BUREN'S (Governor) views on banks and banking, 

1829, xli, xliii 

VOLUNTARY DISSOLUTION of corporations, . . . 64-75 
See Dissolution (Voluntary) of Corporations. 



INDEX 



PRINCIPAL MATTERS. 



ABATEMENT of suits by or against corporations, act to 

prevent 330 

ACT of 1837, entitled " Of moneyed corporations," 1-17 

of 1837, entitled " Of general powers, &c., of corpora- 
tions," 34-39 

of 1839, called the " Safety Fund Act," 39-39 

of 1830, caUed the " Kestraining Act," 39-50 

of 1830, proceedings against corporations in equity. . . 50-75 
of 1830, proceedings against corporations in courts of 

law 340-347 

of 1838, called the General Banidng Law 81, 311 

of 1840, declaring the issue of certain bills or notes by 

banking corporations, &c., to be a misdemeanor 114, 174 

ADJUDICATIONS, digest of, relating to the General Bank 

Act, &c 397-335 

AGENTS to examine banking corporations, how appointed, 

149, 150, 183, 300-303 

powers and duties of, and expenses, how paid 150, 300, 301 

for redemption of circulating notes, how appointed, 

109-113, 186-191 
to examine securities with banking department, how 

appointed 308(Z 

to witness destruction of canceled notes, how ap- 
pointed 308/ 

ASSESSMENT of taxes on banking corporations. .150, 334, 308*, 308ctf 

See Taxes. 
ASSIGNMENTS by moneyed corporations, in certain cases, 

prohibited 6, 7, 8, SOu 

made by, when insolvent, with intent to give a 

preference, invalid in law 8, 9 n., 80c 

See Conveyance, Transfer, Payment, Lien, Security. 



362 INDEX. 

Page. 
ASSOCIATIOlSfS under the general banking law, adjudged 

to be " moneyed corporations," 96, 97 n., Ixi, Ixii 

also to be bound and affected by all general 

statutes relating to suoh corporations 96, 97 n., Lsii 

to be banking corporations with limited powers. 97 n. 

to have no power to traffic in state stocks 97 n., Ixiii 

term defined to include individual bankers 174 

See Banking Corporations. 

BANES, Public, when first established vi 

1153, Bank of Venice vi 

1694, Bank of England vi 

1695, Bank of Scotland vii 

1781, Bank of North America vii 

1783, Bank of Ireland vii 

1791, Bank of the United States vii 

1791, Bank of New York xiv 

1803, Bank of France vii 

Chartered by the State of New Torh — 

ftom 1781 to 1839 284, 385 

from 1839 to 1838. . , 386-389 

organized under the general banking law from 1838 

to August, 1855 389-394 

history of New York legislation on the subject of 

banks and bankings, from 1781 to 1838 vii to lix 

BANKING, Origin of v 

imauthorized by law, prohibited 39-49 

See Restraining Acts. 
BANKRUPTCIES of corporations. 

See Fraudulent Bankruptcies. 
BANKING CORPORATIONS, how organized under the 

general banking law 91 

definition of term, 308A 

any number of persons may associate 91 

to establish offices of discount, deposit, and cir- 
culation 91 

capital stock not to be less than $100,000 91, 308« 

have no power to traffic in state stocks 97 n. 

may become owner of stock of the United States, 

or of the State of New York 308a! 

such persons shall make a certificate 93 

contents of such certificate 93, 93, 94 

where such certificate shall be filed 94, 199 

copies of such certificate may be used as evidence. 94 



INDEX. 363 
Page. 

BANKING CORPORATIONS— continued. 

securities to be deposited with Comptroller to 
the amount of $100,000 before commencing 

business 91, 114 

express powers of such corporations 83, 94, 95, 34 

adjudged to be moneyed corporations 96, 97 n. 

shares in, to be deemed personal property 96, 97 

to be transferable, &c 96 

no change to be made in articles to impair rights, 

&c., of creditors 98 

when change made, new certificate to be filed. . . 308« 
power to increase capital may be reserved by the 

articles 98 

contracts by, how to be signed 98 

suits, &c., how to be brought, &c 98 n., 135-137 

actions against such corporations, how main- 
tained 98n., 99, 135-137 

shareholders not personally liable for debts of 

such corporations 99, 100 

except debts contracted after Jan. 1st, 1850. . . . 155 
such corporations may hold real estate for certain 

specified purposes, [See Real Estate,'] 100, 101 

when chancellor may order an examination 101 

diyidends, provisions as to 3, 3, 4, 104 

if any part of capital withdrawn, no dividends to 

be made until deficit be made good 104 

no dividends to be made, except irom surplus 

profits 80as 

damages on protested " circulating notes," 105 n., 190 

duties of president and cashier 105, 308c 

power to remove president, &c., at pleasure 95 

when banking corporations may relinquish busi- 
ness 133 

when deemed dissolved 80e 

subject to taxation 150, 834 

may te proceeded agamstfor the following causes — 
for violations of provisions of the general 

banking law 58, 104 

for making dividends in certain cases 104 

for violations of any other statute binding 

upon them 58 

for neglecting to make quarterly reports 140, 149 

if insolvent, or unable to pay their debts 58, 59 n. 



364: INDEX. 

Page. 
BAJSTKING CORPORATIONS— continued. 

if default be made in payment of any debt 

or liability contracted aft&r Jan. 1, 1850. 155, 158, 159 
if not " clearly solvent," the judge to make 
an order declaring the corporation imol- 

vent 159, 160 

may reduce capital to not less than |100,000 .... 308t 
shall give notice of such reduction to superin- 
tendent 208f 

duty of superintendent upon receipt of notice . . . 308J 

certificate of reduction to be filed and notice to 

be published 208a 

such reduction not to afiect the liability of stock- 
holders , 308m 

two or more in same city may consolidate 208^^ 

proceedings on such consolidation 208y 

not to affect pending suits 308aa 

nor lessen the liability of stockholders 308aa 

Penalties imposed as follows — 

for violating § 6 of the Restraining Act. ... 43 

for violating §§ 8 and 10 of Restraining Act . . 47, 48, 49 
for violating any of the provisions of the acts 

concerning foreign lank notes 108, 195 

for neglecting to redeem their circulating 

notes 110 

for issuing bills or notes in violation of the 

Act of May 14th, 1840 114, 174 

for neglecting to make quarterly reports, 

140, 149, 183, 196 
for neglecting to keep a book containing 

names, &c., of shareholders 157, 308b 

for a refusal to exhibit such book. 80, 157, 208w 

for re-issuing circulating notes of incorpo- 
rated banks after a certain time in certain 

cases 197, 198 

See Associations, Officers & Directors, Injunc- 
tion, Receivers, Chancellor, Stockholders, 
act to enforce responsibility of. Post 
Notes. 
BANK BILLS of foreign banks under $5, act prohibiting, 

repealed 206 

See Foreign Bank Notes, Circulating Notes, Post 
Notes. 



INDEX. 365 

Page. 
BANK NOTES, Act of 1830 concerning 75 

See § 31 General Banking Law, p. 105. 

redemption of 109-113, 186-191 

canceled, to be burnt in presence of Agent of 

Bank 208/ 

See Circulating Notes, Post Notes, Foreign Bank 
Notes. 

BANK DEPARTMENT, an act to establish: 178-185 

an act in relation to 308p, 308s 

an act to amend an act to organize 308a, 208p 

charged with the execution of all laws relating 

to banks 179 

chief ofBcer, a superintendent 179 

how appointed, term of office, &c 179 

powers of superintendent 180 

may receive deposit of money in place of 

securities 308j 

to give up securities upon such deposit. . . 308j 

to advertise notice of redemption upon the 

receipt of such deposit 308 j 

at expiration of notice to give up balance 

of money 308r 

to hold in custody bank plates, &c 181 

expenses of department, how paid 181, 183 

§ 14 of general banking law to apply to superin- 
tendent 91, 183, 183 

superintendent to fix the day for quarterly bank 

reports 183, 308« 

to destroy counterfeit bank notes and plates 308s 

mortgages, how to be held by him 184 

annual reports of superintendent 184 

BANK OF ENGLAND prohibited from trading ixn., 83 n. 

isme department separated from ianhing depart- 
ment 84 n. 

design of such separation 84 n. 

issues of, secured by government debt liiin., 84n_ 

See prohibitions against trading, in charters of the 
banks of Scotland, Ireland, France, and of the 
United States, pp. ixn., xiiin. 

See Tradiag, Mercantile Traffic. 
BANKING POWERS, first legislative specification of, in 

1835 xxvii 

not specified in early bank charters xvi 



366 INDEX. 

Page. 
BANKING POWERS— contiQued. 

enumerated in the statute of 1837 26 

in the Restraining Act, of 1830 40 n. 

in Safety-Fund bank charters ; . . . . 95 n. 

in the General Banking Law 94, 95 

BANKING SYSTEMS of New York. 

Jirst system from 1791 to 1839 xiy to xlui 

charter of Bank of New York, 1791, is a model 

of bank charters prior to 1835 xiv-xrii 

leading features of bank charters prior to 1835. . xiv-xvii 
these charters contained no specification of bank- 
ing powers ; xyi 

they authorized an issue of notes to tJtree times 

the amount of capital : xxxvi 

and required only a small part of the capital to 
be actually paid in before issuing notes. 
(See Bank Charters prior to 1839.) 
from 1791 to 1835 the legislature relied upon pro- 
hibitory clauses in each charter xvi 

aU these contained a prohibition against trading 

by banks xvi 

Restraining Act of 1804 guaranteed to banks a 

Monopoly xvii 

Restraining Act of 1818 further guaranteed this 

monopoly xix 

main provisions of early bank charters derived 
from charters of Bank of England and Bank of 

the United States xx 

banks chartered in New York from 1782 to 1839 . 284, 385 
means employed to obtain ianlc charters in 1799, 

1805, 1813, &c xxitoxxv 

Spencer's report (1835) on certain insurance com- 
panies exercising tanking powers by loaning 

bonds, &c xxiv 

Spencer's bill of 1835 to prevent fraudulent lanh- 

ruptcies by corporations xxv 

this was a statute ofhanhruptey applied to corpo- 
rations xxvi 

in 1835, the legislature for the first time specified 

in bank charters, tanhmg powers xxvii 

in 1836-7, certain insurance companies assumed 

the exercise of banking powers xxviii to xxxv 

in 1836-7, ofiicers in these insurance companies 



INDEX 367 

Page. 
BANKING SYSTEMS— continued. 

were indicted xxix to xxxv 

these criminal prosecutions were generally known 

as the " conspiracy trials," xxix 

" Life & Fire Bonds," adjudications upon xxx to xxxv 

1837, Governor Clinton, in his message, recom- 
mended further restrictions on banks ..... xxxv to xxxvii 

1837, the legislature adopted a stringent code of 
statute regulations to govern " moneyed corpo- 
rations," which included inmirance companies 
(§§ 51, 53, p. 33) xxxvii 

this code prepared by Revisers familiar with the 

disclosures made by the " conspiracy trials". . . xxxviii 

main objects sought to be attained by this code 

of 1837 xxxix to xl 

See this code (Revised Statutes), pp. 1-38. 

the code of 1837 contained onerous provisions in 

relation to directors, &c 10-13 

1839, Governor Van Buren, in his message, rec- 
ommended a modification or repeal of some of 

the restrictions in the code of 1837 xli to xliii 

1839, the second, or safety-fund system xliii 

leading features of this system xlv, xlvi 

it created a " bank fund," xlvi 

it established a board of Bank Commissioners. . . xlvi 

it modified certain provisions of the code of 1837, 

10-13, 36, 37 

charters under it specified the banking powers 
granted xlv, 95 

and contaiaed a prohibition against trading by 

banks xlv 

banks under it were prohibited from issuing 
notes, &o., on time xliv, 38 

were also prohibited from exercising corporate 
powers not expressly granted 35 

were subject to iaspection by the Bank Commis- 
sioners xW, 34 

were prohibited from making loans, &c., exceed- 
ing twice and a Jialf their capitals 36 

were forbidden to have biUs in circulation ex- 
ceeding twice their capitals 36 

were forbidden to make loans until the wTwle 
capital was paid in 38 



368 INDEX. 

Page 
BANKING SYSTEMS— contmued. 

banks chartered under the safety-fond system 

from 1839 to 1837 384, 385 

how this system worked xlvi 

1837, all the safety-fmid banks in the State sus- < 

pended specie payments „ . xUx 

this suspension sanctioned by the legislature for 

oneyear xlixn. 

But see Constitution of 1846, p. 365. 

1837, restraining act so modified as to allow indi- 
tiidv/ik to receive deposits, &c 49 n. 

this repealing act not to apply to corporations, 
foreign or domestic 49, 50 n. 

remedies proposed, and theories advocated, by 

McCullooh and others 1 to Ivi 

1888, April 16th, a majority of bank delegates 
from eighteen States resolved not to resume 
specie payments before January, 1839 xlix, 1 

1838, April 18th, the legislature passed the gene- 
ral tanleing law 1, 81 

1888, the third, or existing ianMng system : 

distinctive principles of this system Ivii to lix 

it separates the issue from the ianMng depart- 
ment 83,83, 84n.,91n. 

it requires ample security for aU bank issues, .... 365,81,83 

it authorizes the issue of only a certain Mnd of 
promissory notes 83 n. 

it makes the issue of post notes a misdemeanor . . 114 

tefore any notes are given out by the issue de- 
partment, securities must be pledged for their 
redemption 81,83 

it authorizes any number of corporations to be 
formed 91 

it specifies the ianMng powers which such corpo- 
rations may exercise 94,95 n. 

it authorizes each corporation to fix for itself its 
name, its capital, its location, and the period 
of its corporate life Ix, 93, 93, 94 

it requires an actual deposit of $100,000 in secu- 
rities before commerwing banking business. . . . 91,114 

banks imder this system subject to all general 
laws relating to "moneyed corporations," &c.. 

96, 97, n., Ix to Ixiii 



INDEX. 369 

Page. 
BACKING SYSTEMS— continued. 

safety-ftmd and general-law systems contrasted. Ivii 

banking corporations organized from 1838 to 1855 389-395 

BILLS OF EXCHANGE, acts ia relation to 253-360 

form a large part of the circulating medium 300, 801 n. 

amount in circulation in Great Britain 801 n. 

bankers' bills and mercantile bills, difference be- 
tween 808 n. 

fictitious bills, described by McCuUoch 303 n. 

"drawing & re-drawing," described by Adam 

Smith 301 n, 303, 303 

"raising money by circulation," described by 

Adam Smith 301 n, 303, 803 

history of a Scottish Bank of 1769, by Adam 

Smith 303n. 

bills on time, or payable with interest, issues of, 

by banking corporations, prohibited 38,114 

imless drawn on foreign countries [Act 0/1850,] 174 

damages on non-payment of bills 356, 357 

on bills on certain Northern and Eastern States. 356 
" " on certain Southern and Western States. 356 
" " on other States and places on this Con- 
tinent 356 

on bills on any person or place in Europe 356, 357 

damages to be in lieu of interest and charges . . . 357 

when no reference to rate of exchamge shall be 

made 357 

otherwise when payable va. foreign aarreney 357 

for non-acceptance of bills 357 

by whom alone damages shall be recovered 357 

BOARD OF DIRECTORS, quorum of 37, 308 bb 

previous resolution of, necessary to authorize cer- 
tain transfers 8 n. 

See Gillet YS. PUllips, p. 838. See OflScers & Di- 
rectors. 
By-Laws regulating elections must be published . 80 d. 

CHANXDELLOR shall home power — 

to restrain any corporation from exercising a 

franchise not granted to it 51 

from doing business, not authorized by charter. . 51 

to restrain individuals from exercising corporate 

rights not granted to them 51 

when such injunction may be issued 53, 58, 59 



3Y0 INDEX. 

Page. 
CHANCELLOE shall heme jvrisdiction. 

over directora of coiTporations 53 

to compel them to account for corporate funds . . S3 

to decree payment of property wasted 53 

, to suspend officers in cases of abuses 53 

to remove officers for misconduct 53 

to direct new elections , 53 

to set aside alienations of property made contrary 

to provisions of Txm 53 

to set aside like alienations made for purposes 

foreign, to lawfiil busiuess of the corporation. . 53 

to restrain such threatened alienations 54 

preceding powers how to be exercised 56 

when corporate property inay be sequestered 57 

upon final decree, how distribution shall be made 58 
certain acts to be deemed a surrender of corpo- 
rate rights, &c 58 

certain omissions and acts to dissolve a corpora- 
tion 58 

if insolvent, or unable to pay its debtSj a corpo- 
ration may be enjoined 58 

it may be enjoined for violation of its charter. . . 58, 104 

See also § 18 Safety Fund Act, p. 34. 

or for a violation of any law binding upon it. . . 58 

See § 18 Safety Fund Act, p. 34. 

See Banking Corporations, Injunction, Insolvency. 

CHANGE OF PLACE of business by banking corporation^. 92 n. 

special acts authorizing xxv, 92 n. 

See Individual Bankers. 
CHAEITABLE INSTITUTIONS, dividends on stocks held 

by , 331 

Act in relation to 231 

CHARTERS, reservation of power to repeal 37 

of Bank of England 1694, prohibitions in is n. 

of Bank of North America (1781, 1783,) what pro- 
hibitions and restrictions in, were omitted ..... viii 
inserted in the Pennsylvania charter of 1787 .... xi 
of Bank of the United States 1791, prohibitions in xiv 

of Bank of New York 1791, prohibitions in xvi n. 

of Banks of France, Scotland, and Ireland, prohi- 
bitions in ix n. 

leading features and provisions in New York bank 

charters, prior to 1825 xiv 



INDEX. 371 

CHARTERS— continued. ^''^^' 

how changed in 1835 xxvii 

of safety-jftmd banks, how framed, from 1829 to 

1838 xly 

distinctions between safety-ftmd bank charters 

and the provisions of the general law of 1838 .. Ivii 

See Banking Systems. 

CHARTERED BANKS, special provisions as to 171, 173 

upon expiration of their charters may organize 

under the general lam 171 

registered notes may be issued to 154 

may purchase certain stocks, &c 173 

certain notes of, to be redeemed and destroyed. . 187 

may hold certain real estate 173 

See Banking Corporations. 
CffiCULATma NOTES, issued by Bahkmg Corporations: 

to be received from the Comptroller 81, 83 

to be countersigned and registered by Comp- 
troller 81, 83 

to be payable on demand and without interest . . 38, 83, 83, 

114, 174 

to be payable at bank's place of business 83-85, 105 

to be stamped on their face, "secured by pledge 

of public stocks, &c" 88 

to be signed by the president, or vice-president, 

and cashier 98 

" ample security" for their redemption in specie, 

must be required by the legislature . . : 365 

what securities may be taken 83, 88, 89, 308 q, 308 dd. 

what mortgages may be taken 88, 153, 184 

no mortgage exceeding $5,000 can be received. . 153, 184 
what State stocks may be pledged. . . 83, 113, 143, 153, 154, 

170, 171 

pledged securities, when to be sold 89, 90 

holders of biUs secured a preference 365 

plates, dies, &c., to remain in custody of Comp- 
troller or Superintendent 90, 138, 181 

plates of failed banks to be destroyed by super- 
intendent 308 f. 

counterfeit bank-note plates to be destroyed 208 s. 

penalty on Comptroller for violating § 14 of the 

geimral law 91, 183, 188 

issue of notes, payable on time, prohibited 38, 114 



372 INDEX. 

Page. 
CIRCULATmG NOTES— continued. 

issue of notes or bills, payable witli interest, pro- 

Hbited 38, 114 

issue of bills, except foreign bills of exchange, for- 
bidden 38, 114, 174 

issue of notes or bills, by banking corporations not 

specially authorized by law, prohibited — § 3 . . 35 

See §§ 3, 6, of Restraining Act, pp. 41-44. 
bills less than $1,000 to be payable alt the office of 

the bank 75, 105 

when to be deemed payable at the banking-house. 75,105 

mutilated may be exchanged 115 

less than |1 forbidden 44, 45 

how demanded and protested 187-190 

when interest may be recovered 187 

when interest shall not be recovered 188 

in what manner protested 188, 189 

damages for non-payment of 190 

aggregate amount in circulation, August, 1855 . . 394 

when returned to the bank department for de- 
struction must be burned in presence of agent. 308/ 

redemption of. 308i 

notice of redemption of 308i 

lien of, when to cease 308r 

See Post Notes, Bills of Exchange, Drawing and 
Re-Drawing. 
CLEABINa HOUSE in the city of New York, account of. 366-377 

constitution of 378-383 

names of Associated Banks 383, 383 

See New York Clearing House. 
CLINTON'S (Gov.) views on banks and banking, 1837. .xxxv to xxxviii 
COLLECTION OF DEBTS against corporations. Act to 

facilitate ^ 383 

COMPTROLLER, powers and duties of, relative to securities 

pledged for " circulating notes," , 81-91, 180 

penalty on, for violating § 14 of the general banking 

law 91, 183, 188 

See Superintendent. 

CONSOLIDATION of banking associations, act to provide 

for 308a! 

CONSPIRACY TRIALS of 1836 and 1837, history of, &c. . xxix 

See Banking Systems. 



INDEX. 373 

Page. 

CONSTITUTION of 1821, pro-visions of, as to the creation 

of corporations by the legislature 397 n. 

of 1846, provisions of, as to corporations 264, 265 

the term " corporation,'' defined by 264 

corporations to be formed under general laws . . . 264 

not to be created by special charter 264 

the legislature shall have no power 
to pass a special charter for banldng purposes. 265 

nor to pass a law sanctioning a suspension of 

specie payments • 265 

fhe legislature shall provide 

for the registry of aU bills or notes, put in 

circulation as money 265 

and shall require amvple seewrity for their 

redemption in specie 265 

stockholders shall be liable for certain debts. 265 

bin holders to have a preference in cases of 

insolvency 265 

CONTEMPLATION OF INSOLVENCY, conveyances in, 

by moneyed corporations invalid 8, 9, 80c 

See Conveyances, Transfers, Insolvency. 
CONTRACTS by banking corporations to be signed by the 

president or vice-president, and cashier. 98 

by a corporation unauthorized by its charter, void.52, 53, 54 n. 
CONVETANCES by a moneyed corporation, when insolvent, 

with intent to give a preference, invalid 8, 9, 80e 

in contemplation of insolvency, with like intent, 

invalid 8, 9, 80(J 

See Brouwer v. Harbeck, p. 9 n. 
unauthorized by a previous resolution of the board 

of directors, forbidden in certain cases 7 

See Oillet vs. Phillips, p. 323. 

Blunt vs. Banna, p. 7 n. 

for benefit of a corporation, must be directly to it 

by name, except, &c 6 

But see § 34, sub. 4, as to real estate, pp. 100, 101. 
See Transfers, Lien Created, Security Given, Pay- 
ment, Assignment, Real Estate. 
CORPORATION, the term defined by the Constitution of 

1846 265 

by Bronson, J. 304, 305 

by Marshall, C. J 305 

by Kyd 305 



374 INDEX. 

COEPORATION, the term defined— continued. ^*^°" 

by Grant 3O5 

distii^iction between corporations and partner- 

sMps 306 

" moneyed," defined by Revised Statutes 33 

has such powers as are expressly granted 25 n. 

and such incidental powers as aie twcessary to the 

exercise of its express powers 35 

the exercise by, of powers not granted prohibited. 35 
shall not by construction of imphcation possess 

imiMnff powers 36 

forbidden, by the act of 1850, thereafter to inter- 
pose the defense of usury 364 

voluntary dissolution of 64-75, 308i 

proceedings against, in equity. 50-64 

proceedings against, in courts of law 340 

foreign, proceedings against 343-353 

not estopped from denying its power to make a 

contract. .... 53 n. 



forbidden to exercise banting powers 36 

or to employ its effects for the purpose of 

issuing notes, &c . 41 

or to keep any office for the purpose of re- 
ceiving deposits, &c 43 

or for the purpose of issuing notes, &c 43, 48 n. 

See Banking Corporations, Restraining Acts. 
COUNTERFEIT bank notes or plates, to be destroyed by 

the Superintendent of Bank Departrnent 308s 

COUNTERSIGNED NOTES, aggregate amount in circula- 
tion in August, 1855 394 

See Circulating Notes. 
CREDITORS of moneyed corporations, regulations to secure 

the rights of 1-17 

biU holders, in certain cases, to have a preference. 365 

stockholders to be individually responsible, in 

certain cases 365 

directors to be individually responsible in certain 

cases 80a 

DAMAGES on protested circulating notes 190 

on protested bills of exchange 356, 357 

See Bills of Exchange. 



INDEX. 375 

Page. 
DEBTS of certain banking corporations, stockholders liable 

for 155, 265 

against corporations, an act to facilitate the collec- 
tion of 233 

DECISIONS on § 4 of the act of May 14th, 1840 114^132 n. 

on § 1, General Statute (1 R. 8. 589) 2, 8, 320 

on §§ 8, 9, General Statute (1 R. S. 591) 7, 8, 9 n., 323 

on the restraining acts 43 n., 48 

relative to the General Banking Law 297-359 

relative to Receivers of corporations 57 n. 

as to unauthorized contracts made by corporations. . . 51-55 n. . 

as to proceedings against corporations, &o 74, 75 n. 

DEFINITIONS of certain terms used in the Revised Statutes. 23, 24 

term " moneyed corporation" defined 23 

term " directors," 23 

term " effects," 24 

term " evidence of debt," 24 

term " corporations," as used in the Act of April 
6th, 1850, to prevent corporations from inters 

posing the defense of usury 364 

term " corporation," as used in the Constitution 

of 1846 364 

term " association," as used in the act of April 

11th, 1849 174 

term " stockholder," as used iu the act of April 

5th, 1849 155 

a corporation, definitions of, by jurists and others. .304, 305 n. 
partnerships and corporations, distinction be- 
tween 306 n. 

See Corporation, Banking Corporations. 
DIGEST OP LEADING DECISIONS relating to General 

Bank Act 397-359 

" DIRECTORS," as used in Revised Statutes, defined 33 

as to election of. 17-23, md, 146 

not less than five may constitute quorum 208J5 

penalty on, for viQlating certain section of Re- 
vised Statutes 10 

penalty on, for piu-chasing notes of the corpora- 
tion for less than amount due. 16, 80« 

penalty on, for discoimting notes in certain cases. 16, 80« 

penalty on, for violating § 3 of Restraining Act. 41 

trustees of creditors in certain cases 28 

individually responsible in certain cases 80a 

shall make dividends from surplus profits only . . 80a 



3T6 IHDEX. 

Page. 
" DmECTORS"— continued. 

shall not reduce the capital stock by declaring 

dividends SOas 

shall not receive note in payment of installment. 80a 

personally liable in case of violation of above 

provisions 80a; 

action at law or equity against such directors, 

not barred by the statute 80a 

See Officers and Directors. 

DISSOLUTION {Volunta/ry) of corporations 64-77, 3084 

when directors may apply for dissolution 65 

contents of application 66 

order to show cause, when to be entered 66 

when corporation to be dissolved 67, 80c 

who may be appointed receivers 67, 68 

rights, interest, and authority of such receivers. . 68 

such Receivers to have all the power of trustees 

of estates of insolvent debtors 68 

certaiu sales, &c. declared void 69 

debtors to account to Receivers 69 

Receivers to have power to refer controversies.. 69 

Receivers' commissions 70, 71, 134, 135 

order of payment of debts 71 

Receivers subject to control of Court of Chancery. 73 

decrees and orders subject to appeal 74 

certaiu corporations excepted 74 

See Corporations, Receivers. 

DISTRIBUTION of flmds by the ComptroUer 175-177 

DIVIDBNDS by banking corporations, — 

to be madefrom profits only 5, SOa 

how profits are to be calculated. ^ 5 

surplus profits, how ascertained 5 

losses, how to be charged 5 

how to be declared on stock owned by the State, 

or literary, &c. iustitutions 381 

not to be made if any part of capital has been 

withdrawn 104 

provision if capital is reduced, &c 140 

if made in such a case, the Chancellor may order 

their affairs to be closed 104 

"DRAWING & RE-DRAWING" of bHls, described by 

Adam Smith 301 n. 

See BiUs of Exchange, Fictitious Bills. 



INDEX. 377 

Page. 

" EFFECTS," the term defined in Revised Statutes 34 

ELECTIONS, power of Supreme Court to examine iato 80c 

by-laws regarding, must be published SOd 

inspectors shall require evidence of right to vote, 

from transfer books sOd 

Inspectors of, to take oath 80c? 

if not held on day designated, must be held 

within 60 days thereafter 80« 

"EVIDENCE OF DEBT," the term defined in ReviLed 

Statutes 34 

EXERCISE of unauthorized banking powers prohibited . . 36 
EXPRESS GRANT of banking powers necessary to their 

exercise by a corporation 36 

EXPRESS POWERS of banking corporations 94, 95 n. 

of safety fund banks 94, 95 n. 

See Banking Powers. 

FICTITIOUS BILLS, description of, by M'Culloch 303 n. 

are a device for obtaining loans 303, 308 n, 

have no efiect in transferring or settling debts . . 303 n. 
the system of drawing a/nd re-droMing is a mode 

of borrowing money 803, 308 n. 

fietiUoua UUs balance each other 308 n. 

those drawn by London on Glasgow are exactly- 
equal to those drawn by Glasgow on London. 803 n. 
See Bills of Exchange, Drawing and Re-Drawing, 
Raising Money by Circulation. 

FOREIGN BANK NOTES, acts concerning 107-109, 193 

See Bank Bills. 
FOREIGN CORPORATIONS, 

are vnthin the prohibitions of the Restraining 

Act, §§ 3, 6 41, 43, 50n. 

may prosecute suits, &c 340 

upon giving security for costs 340 

when they shall not maintain an action 340 

attachments against 343, 348, 346, 347, 358 

in what courts suits may be brought 353, 358 

by whom suits may be prosecuted 353, 353 

in what cases suits may be brought 353, 353 

Act of May 14th, 1840, as to proceedings against. 345, 346 
Act of April 11th, 1843, as to suits against. . ,347, 348, 349 

Act of May 13th, 1845, as to suits against 349, 350 

Act of Feb. 3lBt, 1848, as to suits against 351 

Act of March 15th, 1849, as to remedies against 353 
25 



378 INDEX. 

FOREIGN CORPORATIONS— continued. 

actions against, under the Code of Procedure. . . 353 
FRAUDULENT BANKRUPTCIES of corporations, Act of 

1835, to prevent f xxy 

this was a statute of icmhruptcy applied to cor- 
porations xxvi 

MngTmh bankrupt laws did not extend to corpora- 
tions xxri 

provisions of the Act of 1835 re-enacted in Re- 
vised Statutes xxvi n. 

See Statute Regulations of 1837, pp. 1-38. 
FRAUDULENT ISSUES of corporate bonds or stock de- 
clared to be a felony 307, 308 

GENERAL BANKING LAW, as originally passed (w«A 

notes and refereneei) 81-107 

as altered by subsequent legislation 311-333 

GENERAL LIABILITIES of every corporation 34 

PrivUeges of every corporation 34 

Powers of every corporation , 34 

INCORPORATED BANKS, Act as to withdrawal of their 
> circulating notes after their special charters 

have expired 197 

their power to hold real estate 100, 173 

INDIVIDUAL BANKER. 

definition of term , 308A 

must file a certificate stating residence 144 

penalty for neglect 144 

to deposit securities to the amount of |50,000 . . 143 
to be banks of discount and deposit, as well as 

of circulation 153 

to transact business at place of residence specified 

in the certificate 153 

notice of change of residence to be filed 144 

penalty for neglecting to make reports 143, 308« 

in whose name business shall be conducted 143, 304 

sale of banking business prohibited 304 

sale of banking business prohibited, except to 

partner 3089" 

to be individually liable for circulating notes . . . 304 

notes, how signed 304 

notes to have the word " bank" added 308j? 

to report names of persons interested with him . . 143 

penalty for not making such report 143 



INDEX. 379 

Page. 

INDIVIDUAL BAIOKER— continued. 

persons interested to file a certificate 203 

persons interested to be jointly liable for debts . . 203 

circulating notes to express individual liability. . 204 

circulating notes of, to be payable on demand, 

and -without interest 82-85, 114 

subject to taxation 150 

once in each year to examine securities deposited 

■with the superintendent 208(! 

in case of his inability, must appoint agent to 

make such examination 208d 

shall make quarterly reports 208e 

to appoint agent to witness burning of notes. . . . 308/ 

See Banking Corporations. 
INJUNCTIONS against moneyed corporations, — 

may be issued to restrain any corporation from 

exercising a franchise not granted 51 

to restrain individuals from exercising corporate 

rights not granted to them 51 

■when to be issued 52, 58, 59, 159, 160 

to prevent illegal alienations of corporate property 54 

to prevent directors from using corporate funds 

for purposes unauthorized by the charter. .... 55 n. 

in case of insolvency, to prevent ofllcers, &c. from 

exercising corporate rights, &c 58, 159, 160 

if corporation is unable to pay its debts. 58 

to restrain proceedings at la^w against corpora- 
tions in certain cases 64 

may be issued upon the application of sharehold- 
ers in certain cases 55 n, 59, 160 

See Chancellor, Banking Corporations, Insol- 
vency. 
INSOLVENCY of moneyed corporations, regulations to pre- 
vent 1-17 

object of these regulations, as stated by the Be- 

visors xxxix, 9 n. 

if insolvent, corporation may be enjoined 58 

or if unable to pay its debts 58 

or for violation of its charter 58, 104 

conveyances by, ■when insolvent, ■with intent to 

give a preference, invalid in la^w 8, 9, 80c 

insolvency defined by AUm, J., in Broweer v. 
Harbeck 9 n. 



380 INDEX. 

Page. 
INSOLVENCY of moneyed corporations — continued. 

if not " clearly solvent," the judge shall, by an 

order, declare a corporation to be insolvent . . 160 
if. one year shall be deemed a surrender of the 

franchise and a dissolution 80c 

See Banking Corporations, Injunction, Chancel- 
lor, Conveyances, Insolvent Corporations. 
mSOLVENT CORPOEATIONS with banking powers, pro- 
ceedings against - 58, 158-160 

if insolvent, or unable to pay their debts 58 

for violations of any provisions of their charters 58, 104 

for violations of any other law binding upon them 58 
insolvency defined by Allen, J., in Brouwer v. 

Ha/rbeck 9 n. 

wpon whose wppVxatJum iriffWMtion may mvs. . 56, 59, 158-170 
for what cmmei injvmction may issue. .58, 59, 104, 140, 149, 

155, 156, 159, 160 

a Receiver may be appointed 59, 158-170 

powers and duties of Receivers 60, 68, 161-170 

bill holders to have a preference 365 

directors, &c., may be made parties in certain 

cases 61 

jurisdiction over directors, &c : 61 

proceedings on bills filed by creditors 61 

decree when corporation is insolvent 62 

distribution of corporate property 63 

liabilities of stockholders 63 

liabilities of directors, how enforced 63 

discovery by a corporation may be compelled. ... 63 

when officers compelled to answer 63 

answers of officers, how far evidence 63 

answers, in what cases only, compelled 63 

persons compelled to answer exonerated from 

prosecution, &c 63 

when proceedings at law shall be stayed 64 

certain corporations excepted, &c 64 

See Banking Corporations, Injunction, Chancel- 
lor. 

INSPECTORS of election of directors, how chosen 18 

power to supply vacancies 18 

officers not to be inspectors 18 

oath bf inspectors 19, 80(? 

qualification of voters 19, 80c?, SOe 



INDEX. 381 

Page. 

INSPECTOBS of election of directors— continued. 

form of oath to be administered 19 

when votes shall be rejected 19 

not to vote on hypothecated stock 19 

any person challenged shall take an oath, &c . . . . 19 

aflBdavits to be