ciations and societies, whenever, wherever and however formed, which, in the judgment of the administration of said Bureau, are based, or are operating on plans or methods similar to building and loan associations as defined in section six hundred and forty-eight of the Civil Code; it is also charged with the enforcement of all laws designed for the formation, government or operation, in this State, of any such association, corporation or society.

SEC. 2. The administration of said Bureau shall be vested in two commissioners, to be known and designated as the "Building and Loan Commissioners," who shall be appointed by the Governor (except as herein provided) and commissioned to hold office for the term of four years and until their successors shall be appointed and have qualified. They must be citizens of this State and residents of different counties; and they must not be in any way connected with any association, corporation or society coming under their supervision. They shall be authorized and empowered to appoint a secretary, with powers of examination the same as their own, who must be a practical, skilled accountant, fully conversant with building and loan accounts.

SEC. 3. The Commissioners shall each receive a salary of twenty-four hundred dollars per annum, and their secretary shall receive a salary of not exceeding eighteen hundred dollars per annum. There shall also be allowed and paid the necessary traveling expenses of the Commissioners and their secretary, not to exceed the sum of two thousand dollars per annum. The Commissioners shall procure and have an office in the city of San Francisco, for which there shall be allowed and paid a rental of not exceeding one hundred dollars per month, and such office shall be kept open for business, every business day, during such hours as are commonly observed by the banks of that city as banking hours; they may also provide such fuel, stationery, printing, postage, office help and other necessary conveniences as may be requisite in such office, at a cost not to exceed in the aggregate, the sum of five hundred dollars per annum. All said salaries and expenses shall be audited and paid in the same manner as the salaries and expenses of other State officers. [Amendment approved

March 23, 1907; in effect in sixty days.]

SEC. 4. Before entering upon their respective duties the Commissioners must each execute an official bond in the sum

of five thousand dollars and the secretary a like bond in the sum of two thousand dollars, and each must take the oath of office as prescribed by the Political Code for State officers in general.

SEC. 5. It shall be the duty of the Commissioners to furnish to all associations, corporations or societies, which, in their judgment, legally come under their jurisdiction, and that have otherwise complied with the requirements of law, a license authorizing them to transact business for one year from the date of said license; to receive and place on file in their office the annual or other reports required by law to be made by building and loan associations or other corporations or societies licensed by them; to supply each with blank forms for such statements; and to make, on or before the first day of October in each year, a tabulated report to the Governor of this State, showing the condition of all such associations, corporations or societies reporting to them, with such recommendation as they may deem proper, accompanied by a detailed statement of all moneys received by them since their last report, and the disposition thereof.

SEC. 6. It shall be the duty of one or both of the Commissioners, in person, at least once in each year, without previous notice, to visit and examine into the affairs of every such association, corporation or society licensed by them, incorporated or doing business in this State; on such occasions they shall have free access to all the books, records, securities and papers of every such association, corporation or society and shall first count the cash and check the bank balance of such corporation or association with the proper amount of funds as shown by the books to be on hand and at the date and hour of such examination, and shall then examine and verify the books, accounts, and securities, and, so far as possible and consistent, the values of all property owned or held as collateral security for moneys loaned, and otherwise use reasonable diligence to ascertain the financial condition and solvency thereof. They and their secretary shall have power to administer oaths in the line of duty, and to examine under oath the officers, employés and agents, or the custodian or receiver, relative to any or all of the business thereof. The Commissioners or their secretary or representative shall receive for any examination into the books and affairs of any such association, corporation or society formed outside of the State

of California and applying for a license to do business in this State, their reasonable expenses, which shall be paid by the association, corporation or society so examined; provided, that they may accept the result of any such examination made by the duly constituted authorities of any State having similar laws of supervision.

SEC. 7. To facilitate the examinations specified in the foregoing section, they shall require every such association, corporation or society to keep its books in such form as to accurately show its assets and liabilities in detail and to keep records written in ink, showing the appraised and assessed values of the real estate security held in connection with each loan, and signed in each case by the appraiser, officer or committee charged with making such estimated valuations. The Commissioners shall make a revaluation of the real estate owned, and of the other securities of any such association, corporation or society licensed by them, on which the loan payments may be delinquent for six months or more, and may, for that purpose, appoint local appraisers, who shall be disinterested persons, at the expense of such association, corporation or society; the expense of such appraisement to be fixed by the Commissioners, but not to exceed the sum of five dollars for property located outside of any incorporated limits and three dollars for property located inside of any incorporated limits for each property so examined and appraised. Each appraiser so appointed shall be required to make a sworn report to the Commissioners of his estimated valuations of all property so examined and appraised.

SEC. 8. The Commissioners shall have power to issue subpœnas and require attendance of any or all trustees, or agents of any such association, corporation or society, and such other witnesses as they may deem necessary, in relation to its affairs, transactions and condition, and any such person so served with such subpoena may upon application of the Commissioner be required by order of the Superior Court of the county where the corporation, association or society has its principal place of business, to appear and answer such pertinent questions as may be put to him by such Commissioner and be required to produce such books, papers or documents in his possession as may be required by such Commissioner.

SEC. 9. If the Commissioners, upon any examination, or from any report made to them or to the shareholders, shall find.

that any association, corporation or society licensed by them, is violating the provisions of its charter or of the laws of this State provided for its government, or is conducting its business in an unsafe or unauthorized manner, they may, by an order addressed to the association, corporation or society so offending, direct a discontinuance of such violations or unsafe practices and a conformity with all the requirements of law; and if such association, corporation or society shall refuse or neglect to comply with such order within the time specified therein; or if it shall appear to the Commissioners, in their opinion, that any such association, corporation or society is in an unsafe condition, or is conducting its business in an unsafe manner, such as to render its further proceeding hazardous to the public or to those having funds in its custody, they shall notify the AttorneyGeneral of such facts and furnish him with a statement showing its condition, as the same may have been found to exist; at the same time they shall notify the officers of such association, corporation or society of the fact of such report having been made and direct them to cease the transaction of any new business, and to hold all moneys, securities and property intact, pending the action of the Attorney-General on such report. The Attorney-General shall thereupon apply to the Superior Court, of the county in which such association, corporation or society has its principal place of business, to issue an injunction restraining it, in whole or in part, from further proceeding with its business until a hearing can be had. Such court may, in such application, issue such injunction, and after a full hearing, may dissolve or modify it, or make it perpetual, and may make such orders and decrees according to the course of proceedings in equity, to restrain or prohibit the further prosecution of business by such association, corporation or society, as may be needful in the premises; and may appoint one or more receivers to take possession of its property and effects, subject to such directions as may from time to time be prescribed by the court; or it may, by its decree, order and direct that, in lieu of the appointment of a receiver, the business and affairs be liquidated by a board of trustees equal in number to the board of directors, to be elected by the shareholders, at a meeting thereof, to be called for such purpose and held within two weeks from and after the first Monday succeeding the date of such order and decree; such meeting to be called and held on the order of the Commissioners, one of whom shall be present and preside until

such election shall be had; whereupon he shall report the result to the proper court, and thereupon the term of office of the existing board of directors and of all the officers shall cease and determine. Such board of trustees, when so elected, shall at once assume office and have possession and control of all the property and assets for the purpose of liquidation; and such liquidation shall be conducted by such board under the supervision of the Commissioners, who shall have full power to limit the time within which it shall be accomplished, and to limit the number of employés and the salaries and expenses that shall be allowed and paid. The issuance of an injunction, in the manner herein provided, shall operate to dissolve or stay any and all attachments or executions initiated or levied within thirty days next preceding the date of notification of the Attorney-General by the Commissioners; and, pending the process of liquidation as ordered by the court, no attachment or execution shall be levied, nor lien created, upon any of the property of such association, corporation or society.

SEC. 10. Whenever a receiver or receivers are appointed, or trustees elected in lieu thereof, the Commissioners shall require the president and secretary of such association, corporation or society to, and such officers shall, make a schedule of all its property and make oath that such schedule sets forth all the property which such association, corporation or society owns or is entitled to, and deliver said schedule and possession of the property to the receivers or to the trustees, and a copy of such schedule to the Commissioners, who may at any time examine under oath such president and secretary, or other officers, to determine whether or not all the property which such association, corporation or society owns, or is entitled to, has been transferred to such receivers or trustees.

SEC. 11. The Commissioners shall, at least once in each year and as much oftener as they may deem expedient, examine the accounts and doings of receivers or trustees, and shall carefully examine and report on all accounts and reports made to the proper court, and, for the purposes of this section, shall have full and free access to all the books, accounts and vouchers relating to any such liquidation.

SEC. 12. Upon the certificate, under oath, of any ten or more officers, trustees, creditors, shareholders or depositors of any such association, corporation or society, setting forth their interest and the reason for the making of such examination, directed to the Commissioners, and requesting them so to do,