nonpayment of calls thereon; and it shall not be lawful for such company to use any of their funds in the purchase of stock in any other corporation.

Sec. 39. The copy of any certificate of incorporation, filed in pursuance of this act, certified by the county clerk or his deputy to be a true copy, and of the whole of such certificate, shall be received in ali courts and places as presumptive legal evidence of the facts therein stated.

Sec. 40. Every company incorporated under this chapter, may make insurance upon vessels, freight, money, goods, and effects, and against captivity of persons, and on the life of any person during his absence at sea, and on money lent upon bottomry and respondentia; and they may also make insurance against fire on any dwelling-houses or other buildings, and on merchandise or other property within the United States.

Sec. 41. All policies of insurance made by such companies, shall be subscribed by the president, or in case of his death, inability or absence, by any two of the directors, and countersigned by the secretary of the company, and they shall be binding upon the company in like manner as if executed under the corporate seal thereof. Sec. 42. The said company may invest its funds by loan thereof, in such manner as the directors may deem most advantageous, and may take security therefor; but shall not, directly or indirectly, deal or trade in buying and selling any goods, wares, merchandise, property, stocks, or commodities, whatever. [Amendment, approved April 27, 1863, 747; took effect from passage.]*

Sec. 43. The president and a majority of the directors, within thirty days after the payment of the last installment of the capital stock so fixed and limited by the company, shall make a certificate, stating the amount of the capital so fixed and paid in, which certificate shall be signed and sworn to by the president and a majority of the directors, and they shall, within the said thirty days, record the same in the office of the county clerk of the county wherein the business of the said company is carried on.

Sec. 44. Every such company shall, annually, within twenty days from the first day of January, make a report, which shall be published in the town or city, or if there be no newspaper in said city or town, then in some newspaper published nearest the place where the business of the company is carried on, which shall state the amount of capital, and of the proportion actually paid in, and the amount of its existing debts, and of insurances effected, which report shall be signed by the president and a majority of the directors, and shall be verified by the oath of the president or secretary of said company, and filed in the office of the county clerk of the county where the business of the company shall be carried on; and, if any of said companies shall fail so to do, all the directors of the company shall be jointly and severally liable for all the debts of the company then existing, and for all that shall be contracted before such report shall be made.

Sec. 45. The directors of every such company, at such times as their charter or by-laws shall prescribe, shall make dividends of so much of the profits of the company, and of the interest arising from their capital stock, as to them shall appear advisable; but the moneys *Original section:

Sec. 42. The said company shall not, directly nor indirectly, deal or trade in buying and selling any goods, wares, merchandise, stocks, or commodities whatever.

received and notes taken for premiums of risks, which shall be undetermined and outstanding at the time of making such dividend. shall not be considered as part of the said profits.

Sec. 46. If the directors of any such company shall declare and pay any dividends when the company is insolvent, or any dividend, the payment of which shall render it insolvent, or which would diminish the amount of its capital stock, they shall be jointly and severally liable for all the debts of the company then existing, and for all that shall be thereafter contracted, while they shall respectively continue in office; provided, that if any of the directors shall object to the declaring of such dividend, or to the payment of the same, and shall, at any time before the time fixed for the payment thereof, file a certificate of their objection in writing with the clerk of the company, and with the county clerk, they shall be exempt from the said liability.

Sec. 47. Once in every three years, and oftener, if required by the stockholders, the directors shall lay before them an exact and particular statement of the profits, if there be any, after deducting losses and dividends.

Sec. 48. If any of the said companies shall be under liability for losses to an amount equal to their stock, and the president or directors, after knowing the same, shall make any new or further insurance, the estates of all who shall make such insurance, or assent thereto, shall be severally and jointly liable for the amount of any loss which shall take place under such insurance.

Sec. 49. The president and directors of every such company shall, previous to subscribing any policy, and once in every year afterward publish, in two newspapers printed in this state, the amount of their stock, against what risks they insure, and the largest sum they will take on any one risk.

Sec. 50. The president and directors of every such company shall, whenever required by the legislature, lay before them a statement of the affairs of the company, and submit to an examination on oath concerning the same.

Sec. 51. The said companies shall never take, on any one risk, whether it be a marine risk or an insurance against fire, a sum exceeding one-tenth part of their capital actually paid in.

Sec. 52. Nothing but money shall be considered as payment of any part of the capital stock, and no loan of money shall be made by any such company to any stockholder therein; and, if any such loan shall be made to a stockholder, the officers who shall make it, or who shall assent thereto, shall be jointly and severally liable to the extent of such loan and interest, for all the debts of the company contracted before the repayment of the sum so loaned.

Sec. 53. If any certificate or report made, or public notice given, by the officers of such company, in pursuance of the provision of this act shall be false in any material representation, all the officers who have signed the same, knowing it to be false, shall be jointly and severally liable for all the debts of the company contracted while they are stockholders or officers hereof.

An act to provide for the incorporation of mutual insurance com

panies.

[Passed April 26, 1851; Stats. 1851, p. 523.]

Section 1. Any seven or more persons who desire to form a mutual insurance company, shall make, sign, and acknowledge, before some

officer competent to take the acknowledgment of deeds, and file in the office of the clerk of the county in which the business of the company shall be carried on, and a duplicate thereof in the office of the Secretary of State, a certificate in writing, in which shall be stated the corporate name of the company, the proposed amount of the capital stock, the proposed term of its existence, not to exceed twenty years, the proposed number of shares of which its stock shall consist, the number of directors and their names who shall manage the concerns of the company for the first year, and the names of the town and county in which the office of the company is to be established.

Sec. 2. All the provisions of chapter second of the act entitled "An act concerning corporations, passed April twenty-second, eighteen hundred and fifty, excepting sections thirty-four, thirtyseven, forty-two, forty-three, fifty-one and fifty-two of said chapter, shall be applicable to mutual insurance companies.

Sec. 3. When the certificate shall have been filed as aforesaid, the persons who shall have signed and acknowledged the same, and those who shall thereafter subscribe to the capital stock, or who shall become insurers under such certificate of organization, shall be a body politic and corporate by the name stated in the certificate.

Sec. 4. It shall be lawful for the directors to call in and demand from the stockholders respectively all such sums of money by them subscribed, at such times and in such payments or installments as the directors shall deem proper, under the penalty of forfeiting the shares of stock subscribed for and all previous payments made thereon, if a personal demand shall have been made at least six weeks previously, or if a notice requiring such payment shall have been published six successive weeks, in some newspaper of the place where the business of said company is carried on, or if no newspaper be published in such place, then in a newspaper published nearest there

to.

Sec. 5. Every company incorporated under this act may make insurance upon vessels, freight, money, goods, and effects, and against captivity of persons, and on the life of any person during his or her absence at sea, and on money lent on bottomry and respondentia, and may also make insurance against fire, on any dwelling-house, buildings, merchandise, or other property situated in the state of California, and may also make insurance upon the life of any person, whether at home or abroad, for a limited term, or during his or her natural life.

Sec. 6. No company incorporated under this act shall take on any one risk, whether it be a marine risk, an insurance against fire, or an insurance on the life of any person, a sum exceeding onetenth part of their capital subscribed.

Sec. 7. Notes of the subscribers to the capital stock, approved by the directors of the company, and upon which shall have been paid not less than ten per cent in cash, may be taken as part of the capital stock, and such notes shall be subject to such assessments, from time to time, as the directors of the company may require, but no debts shall be contracted, and no policies shall be issued by such company before such notes shall have been given, and such ten per cent paid, thereon. All premiums upon policies of insurance, issued by such companies, shall be required to be paid in cash. No loan of money shall be made by any such company to any stockholder thereto, and if any such loan shall be made to a stockholder, the officers who shall make it, or who shall assent thereto, shall be jointly and severally liable to the extent of such loan and interest for all the

debts of the company contracted before the repayment of the sum so loaned. No declaration of profit shall be made until the net earnings of the company shall have accumulated to a sum equal in amount to the original capital stock subscribed, which shall there remain with the company as a cash capital, not subject to division among the stockholders until the business of the company shall have been closed, its debts paid, and its outstanding policies canceled; and if any deficiency shall ever at any time occur in such eash capital, from any cause, no further division of profits shall take place until such deficiency shall have been made up entire.

Sec. 8. No company shall issue policies until the sum of two hundred thousand dollars shall have been subscribed, and conditions complied with, as required in section seventh.

Sec. 9. No company shall directly or indirectly deal or trade în buying or selling any goods, wares, merchandise, stock, or commodities whatever; but this shall not be construed to prevent such company from selling any goods, wares, merchandise, stock, or commodities which have been hypothecated or pledged with them as securities, for the loan or investment of money, whenever the same is mrade in good faith to protect the company from loss upon such loan or investment.

Sec. 10. Companies incorporated under this act may cause themselves to be reinsured when deemed expedient against any risk or risks against which they have made or may make insurance.

An act supplementary to act of April 22, 1850; Stats. 1850, p. 347.

[Approved January, 1866; Stats. 1865-66, p. 23.]

Section 1. Any insurance company heretofore or hereafter incorporated under chapter second of the act to which this act is supplementary, the capital stock of which has been entirely paid in, may, as is herein provided, increase its capital stock to any amount which may be deemed sufficient and proper for the purposes of the corporation, which increased capital stock shall all be called in, demanded, and paid in according to the provisions and requirements of said act, the same as if it had been a part of the original capital stock.

Sec. 2. Whenever it is desired to increase the amount of capital stock, a meeting of the stockholders may be called by a notice, signed by at least a majority of the trustees, and published for at least four weeks in some newspaper published in the county where the principal place of business of the company is located, which notice shall specify the object of the meeting, the time and place where it is to be held, and the amount to which it is proposed to increase the capital; and a vote of two-thirds of all the shares of stock shall be necessary to an increase of the amount of the capital stock.

Sec. 3. If, at any meeting so called, a sufficient number of votes has been given in favor of increasing the amount of capital, a certificate of the proceedings, showing a compliance with these provisions, the amount of capital actually paid in, the whole amount of the debts and liabilities of the company, and the amount to which the capital stock is to be increased, shall be made out, signed, and verified by the affidavit of the chairman and secretary of the meeting, certified by a majority of the trustees, and filed, as required by the thirty-third section of the act to which this act is supplementary, and when so filed, the capital stock of the corporation shall be increased to the amount specified in the said certificate.

Sec. 4. This act shall take effect immediately.

FIRE AND MARINE INSURANCE.

An act relating to fire and marine insurance companies.

[Approved April 2, 1866; Stats. 1865-66, p. 743.]

Section 1. Any thirteen or more persons who may desire to form a fire or marine insurance company, or both, may make, sign, and acknowledge before some officer competent to take acknowledgment of deeds, and file in the office of the clerk of the county in which the business shall be carried on, and a certified copy thereof in the office of the Secretary of State, a certificate in writing, in which shall be stated the corporate name of the company, the amount of its capital stock, the term of its existence, (not to exceed fifty years), the number of shares of which the stock shall consist, the number of directors, and their names, who shali manage the concerns of the company, for the first year, and the name of the city, or town and county, in which the office of the company is to be established.

Sec. 2. When the certificate shall have been filed as aforesaid, the persons who shall have signed and acknowledged the same, and their associates, shall be a body politic and corporate by the name stated in the certificate.

Sec. 3. The business of such company shall be managed by not less than seven directors, a majority of whom shall be citizens of this state. They shall, except those of the first year, be annually elected by the stockholders, at such time and place as shall be directed by the by-laws of the company, and shall hold office till their successors are duly elected. Notice of the time of holding such elec. tion shall be published not less than ten days previous thereto in some newspaper published in the county where the office of the company is situated, and such election may be postponed from day to day, unless a majority of the stock shall be represented at such meeting, and the election shall be held by such of the stockholders as shall attend in person or by proxy; but no election shall be valid unless a majority of the stock is represented. All such elections shall be by ballot, and each stockholder shall be entitled to as many votes as he owns shares of stock in the said company, and the persons receiving the greatest number of votes shall be directors. And when any vacancy shall happen among the directors, by death, resignation, or otherwise, it shall be filled for the remainder of the year by a majority of the directors remaining in office.

Sec. 4. There shall be a president of the company, who shall be a stockholder in the company, and also such subordinate officers as the company by its by-laws may designate, who may be elected or appointed, and required to give such security for the faithful performance of the duties of their office as the company by its bylaws may require.

Sec. 5. It shall be lawful for the directors to call in and demand from the stockholders respectively all such sums of money by them subscribed at such times and in such payments or installments as the directors shall deem proper, under the penalty of forfeiting the shares of stock subscribed for and all previous payments made thereon, if a personal demand be made or notice requiring such payment shall have been published for six successive weeks, in the same manner as herein before provided for the annual election in section three. The capital shall all be paid in within twelve months from the filing of the certificate, and nothing but money shall be considered as payment of any part of the capital stock; and it shall