UNIVERSITY OF CALIFORNIA LOS ANGELES SCHOOL OF LAW LIBRARY Tdation of the TJorJ? Citf/ in sectoring ike. ry of . City of Buffalo, 82 id., 351. It is immaterial that the principal office or place for transacting the financial concerns of the company is located in a different town or city. Oswego Starch Factory v. Dolloway, 21 N. Y., 449. The tiling of the certificate in the office of the county clerk is sufficient to effect the incorporation. Raisbeck v. Oesterricher, 4 Abb. N. C., 444; Cross v. Pinck- oeyville Mill Co., 17 111., 54 ; Tarbell v. Page, 24 id., 48 ; Stone v. Great Western Oil Co., 41 id., 85 ; Thompson v. Candor, 60 id., 248 j Willard v. Trustees, etc., 66 Id., f>5. An omission to file the duplicate in the office of the Secretary of State does not, in such case, vitiate the incorporation so as to render the members partners MM between themselves. Raisbeck v. Oesterricher, ante. An organization, such as will create a corporation dejure, and can successfully maintain itself against inquiry on the part of the state, does not exist, until the cer- tificates of association are filed in accordance with law. Childs V. Smith, 46 N. Y., 84 ; rev'g 38 How., 328; 55 Barb., 45. The office thus designated is the one which fixes the location of the company for the purpose of taxation upon its capital ; Western Transportation Co. v. Scheu, 19 N. Y., 408 ; even though such designation was made for the purpose of avoiding taxation at its principal business office. Id ; Oswego Starch Factory t. Dollaway, 91 id., 449 ; Union Steamboat Co. v. City of Buffalo, 82 id., 351. But no corporation shall exercise any corporate powers or privileges until all taxes, required by law to be paid before incorporation, and the fees for filing and recording the certificate are paid. Section 3, chap. 563 of 1890. Parties cannot take charter with which they have no concern and effect cor- poration de facto by pretense of user thereunder. Welch v. 0. D. M. & R. Co., 31 N. Y. State Rep., 916. Fact* establishing that defendants occupied position, not of vendors, but of teust and confidence towards plaintiffs. Brewster v. Hatch, 122 N. Y., 349. Promoter* of corporation, before its organization, occupy position of trust and confidence towards thoa whom they induce to invest in enterprise, and are liable for daraafM sustained by reason of their acts. Id. Acknowledgments cannot be taken before one of the signers of the certificate. People eat rel. Erie R. Co. v. Brd. of Railroad Com'rs, 105 App. Div. 273. 6. Corporate names. No certificate of incorporation of a proposed corporation having the same name as a corporation author- izeil to do business under the laws of this state, or a name so nearly ablinj ii as to be calculated to deceive, shall be filed or recorded 4. GENERAL CORPORATION LAW. in any office for the purpose of effecting its incorporation, or of authorizing it to d business in this state. A corporation formed by the reincorporation, reorganiza- tion or consolidation of other corporations or upon the sale of- the property or fran- chises of a corporation, may have the same name as the corporation or one of the corporations to whose franchises it has succeeded. No corporation shall be here- after organized under the laws of this state, with the word trust, bank, banking, insurance, assurance, indemnity, guarantee, guaranty, savings, investment, loan or benefit as part of its name, except a corporation formed under the banking law or the insurance law. Am'd by chap. 704 of 1900. Am'd by chap. 9 of 1002. In effect January 80, 190% 8e lection 1, chap. 135 of 1870, and section 4, chap. (Jll'of 1875, both repealed ; and also chap. 322 of 1870, as amended by chap. 280 of 1876, and chap. 38 of 1891. The Secretary of State must decide in the first instance whether the propoe. Her. Bk., 59 Hun, ML Those dsaHnf with body professing to be corporation can not question ita Kl i GENERAL CORPORATION LAW. rate existence for the purpose of charging its members individually aa partner*. Pemarest v. Flack, 16 Daly, 337. Stockholders are estopped to deny the lawful existence of corporations whiek they have helped to create. Dorris . French, 4 Hun, 292. A person, who has subscribed for the stock, acted as a trustee of the corpora- tion, took part in its management and contracted with it as a corporation, can not dispute the validity of the incorporation in an action under this section. Phoenix W. Co. t>. Badger, 67 N. Y., 294 ; Eaton v. Aspinwall, 19 id., 119 ; Buffalo, etc., R. R. Co. v. Cary, 26 id., 75 ; Aspinwall v. Sacchi, 57 id., 331 ; Whit* v. Ross, IS Abb., 66. 10. Limitation of powers. No corporation shall possess or exercise any corporate powers not given by law, or not necessary to ' the exercise of the powers so given. The certificate of incorporation of any corporation may contain any provision for the regulation of the business and the conduct of the affairs of the corporation, and any limitation upon its powers, or upon the powers of its directors and stockholders, which does not exempt them from the performance of any obligation or the performance of any duty imposed by law. Am'd by chap. 672 of 1895. Took effect May 14, 1895. See section 3, title 3, chap. 18, part 1, R. S., now repealed. Everything relating to the organization of a private corporation is mere matter of individual contract. Troy & R. R R. Co. v. Kerr, 17 Barb., 581. The com- pact, which is to clothe its members with an artificial, corporate existence, must receive the voluntary assent of the whole. Id. The rule is the same as to amendments to the charter or act of incorporation. Id. Unless restrained by law, every corporation has the incidental power to make any contract nece&aary to advance the objects for which it was created. Legrand v. Man. Mer. Ass'n, 80 N. Y., 638. A corporation has no other powers than such as are specifically granted by the act of incorporation, or are necessary for the purpose of carrying into effect the powers expressly granted. People ex rel. Attorney-General t>. Utica Ins. Co., 15 Johns., 358. Corporations can exercise no powers over the corporators beyond those con- ferred by the charter to which they have subscribed, except on the condition of their agreement or consent. Hartford & N. H. R. R, Co. v. Croswell, 5 Hill, 383. Corporations have all the powers of ordinary parties as respects their contract, except when they are restricted expressly or by necessary implication. Brady t>. Mayor, etc., 1 Barb., 590. Corporations can only exercise the powers expressly or incidentally conferred. Curtis v. Leavitt, 15 N. Y. 9, 54. Corporations have no other powers than such as are expressly granted, or such as are necessary to carry into effect the powers expressly granted. Hodge* . City of Buffalo, 2 Denio, 110. A corporation under this act, can purchase, hold and convey, any real or per- sonal estate necessary, to enable it to carry on its transactions. De Qroff . American Linen Thread Co., 21 N. Y., 124. The manufacturing of goods, necessarily implies the power of disposing of them when manufactured, and also of receiving in payment money, or property readily convertible into money, or provisions or stores, for the payment of its employee*. Id. A corporation, after having received from the other contracting party the full consideration, can not be permitted to interpose the defense of ultra viret, in order to excuse itself from that portion of the contract which imposes upon it an obliga- tion. Id. Rider Life Raft Co. v. Roach, 97 id, 378. Manufacturing corporation cannot become accommodation endorser. Nat. Park Bk. v. Q. A. M. W. & 8. Co., 116 N. Y., 281; rev'g 21 J. & S., 367. Fact that maker had note discounted, is notice to bank. Id. Where accommodation paper, executed in name of president, has been ratified by stockholders, and no other rights intervene, it may be enforced against coi* poration. Martin v. N. F. P. Co., 122 N. Y., 185. Corporation can not make accommodation endorsement. Wahligw. S. P. M. Co., 35 N. Y. St. Rep., 864. Act of treasurer is presumed to be, in such case, ultra mres. Id. Corporation can not become surety on lease. Filon v. M. B. Co., 38 N. Y. St. Rep., 602. Railroad corporation has power to make a lease for a term of years. Bevendfe o. N\ Y. E. R R. Co., 112 N. Y., 1. GENERAL CORPORATION LAW. Stockholders are not parties to lease of railroad to another company. Id. Directors have power to make necessary reduction of rental reserve in leaM, if done in good faith. Id. Section 1778 of Code does not apply to action against corporation as endorser. Shorer v. T. P. & P. Co., 119 N. Y., 483 ; 24 N. Y. St.Rep., 868. In absence of any prohibition, express or implied, repurchase of landscript by company, without intending to cancel or retire it, will not pi-event company from using it again, consistently with rights of stockholders and company itself. Rogers c. Phelps, 31 N. Y. St. Rep., 872. Banking association may sue in its corporate name. Columbia Bank t>. Jack- son, 24 N. Y. St. Rep., 738. Persons dealing with corporation, is chargeable with notice of its powers and extent of power and authority of its agents or officers. Jemison t>. Citizens' S. Bk., 122 N. Y., 135. Speculative contracts for sale or purchase of stock by savings bank are ultra vires. Id. Authority to buy and sell exchange, bullion., etc, does not embrace speculative contracts in cotton futures. Id. Corporation can not be held liable for goods sold to company of same name, OD- ground of identity, where it was organized after such sale and has different offi- cers and stockholders with single exception. Wyckoff . U. L. & T. Co., 33 N. Y. St. Rep., 422. When burden is on receiver to show that corporate contract was not authorised or ratified by trustees. Patterson v. Robinson, 116 N. Y., 193. Plea of ultra vim is no defense, where corporation has executed contract in good faith and party has reaped benefit. Watts C. Co. v. Yuengling, 51 Hun, 302. Defense of ultra vires, based upon foreign statutes, must be pleaded. Griesa v Mass. B. Ass'n, 39 N. Y. St. Rep., 1. Non-resident plaintiff may sue foreign corporation in courts of this state, when cause of action arose here. Id. Where validity of ultra vires contract is recognized, and performance accepted by company, court will not deny party benefit of its provisions. Palmer v. C. H, Cem., 122 N. Y., 429. Where compromise agreement expressly states that it is made on behalf of sucb- certificate-holders as should assent thereto, it binds assenting holders only. Humphreys v. N. Y., L. E. & W. R. R. Co., 21 N. Y. St. Rep., 750. A party, dealing with a corporation, is presumed to know the extent of ita cor" porate powers. Akin v. Blanchard, 32 Barb., 527; Adriance v. Roome, 52 Id.. 899 ; Dabney v. Stephens, 40 How., 341 ; Alexander v. Cauldwell, 83 N. Y., 480. But he has a right to presume, in the absence of express notice to the contrary that the corporation does ita duty and acts within and according to ita charter. Akin v. Blanchard, ante. The officers can not bind the company except within the limits prescribed by the charter and by-laws. Adriance v. Roome, 52 Barb., 399. They are special and not general agents. Id. There is no grant of power in the name by which the officer is designated; specially when the authority given is specified, in the by-laws. Id. Where the officers are not authorized by the act of incorporation or by-laws to do a wrtain act, the company can not be held liable therefor except upon proof : 1. That a general or particular authority for that purpose was conferred upon uch officers or either of them, or 2. That the conduct of the company was such as to create a well founded belief that such general or particular authority had been delegated, or 3. That such acta, though unauthorized, were subsequently ratified by the board of trustees. Dabney v. Stevens, 40 How., 341. It can not be presumed that an agent had authority to transact business in which the corporation itself was not, by ita charter, authorized to engage. Alexander . Cauldwell, 83 N. Y., 480. The power of an incorporated company to borrow money, when it has not been directly conferred by its charter, extends, it tecmt, to all cases where it is essential to the transaction of its ordinary business. Beers v. Phoenix Glass Co., 14 Barb., 868. In such case, it is incidental and in effect included in the grant of the principal power. Id. But this power should be limited to and for the appropriate business of the corporation. Id. 8 GENERAL CORPORATION LAW. i / Neither the use of the corporate seal, nor a resolution of the trustees, la nces- eary to make the contract of a corporation valid. Hoag v. Lamont, 60 N. Y., 98. A corporation, organized under this act, may, upon a sale of a portion of its lands to another similar corporation, agree to advance moneys to the latter, to be used in erecting buildings on the premises conveyed. Greenpoint 8. Co. v. Whitin, (59 N. Y.,328. A director, trustee or an executive officer of a corporation is, aa a general rule, without power to bind it or its shareholders by a contract authorized by or entered into with himself and for his individual benefit. Welch . I. & T. N. Bk., 122 N. Y., 177. But if such contract is just as between the parties, and all the share- holders and directors and trustees are competent to assent, and, with full knowl- edge of the terms of the contract, do assent and direct that it be made, it is binding on the corporation and can not be avoided by its shareholders or by persons who subsequently become its creditors. Welch v. I. & T. N. Bk., 122 N. Y., 177. A corporation that has permitted certain individuals to take possession of its property, seal and records, and to act as its trustees, and has in fact held them out to the world as its trustees, and as authorized to act for it, is as much as an individual would be, estopped from questioning the acts of its agents within the scope of their apparent authority. Lovett v. German R. Ch., 12 Barb., 67. A manufacturing corporation may temporarily lease, it seems, its property to some person who will continue and carry on its business. Denike v. N. Y. & R. L. & C. Co., 80 N. Y., 599. The general rules of law relating to contract and property rights apply to cor- porations as well as to individuals, and the principles of law of agency apply to both alike. Martin v. N. F. P. Mfg. Co., 122 N. Y., 165. The stockholders may, where no rights of creditors intervene and no fraud ie claimed, ratify the acts of the president and bind the corporation for the payment of a debt evidenced by notes made and discounted for his accommodation. Id. When a transaction has been ratified by all the owners of the corporate prop- erty, formal action by the board of trustees is unnecessary. Id. In such case, the company can not be heard to impeach it on the ground that it is without, or contrary to authority. Id. ; Kent . Quicksilver M. Co., 78, N. Y., 159. Additional powers conferred upon railroad companies are enumerated in section 4, chap. 565 of 1890; on Ferry corporations, in section 4, chap. 566 of 1890; on Stage Coach corporations, in section 22, chap. 566 of 1890; on Tramway corpora- tions, in section 31, chap. 566 of 1890; on Pipe Line corporations, in section 49, chap. 566 of 1890; on Gas and Electric Light corporations, in section 61, chap. 566 of 1890; on Waterworks corporations, in section 82, chap. 566 of 1890. All corporations, whether foreign or domestic, are debarred from alleging usury in the courts of our state, no matter where the contract was made, or by what lex loci it was to be governed. Rosa v. Butterfield, 33 N. Y., 665. Nor can any cor- poration maintain an action to invalidate its contracts on the basis of usury. Id.; Butterworth n. O'Brien, 28 Barb., 187; Hungerford's Bk. ?>. Dodge, 30 id., 629; Southern L. I. & T. Co. v. Packer, 17 N. Y., 51. Corporations are prohibited from interposing the defense of usury in any action. Butterworth v. O'Brien, 23 N. Y., 75. This deprives them of the right to recover back money paid by them in excess of legal interest. Id. The receiver stands in no better position. Id.; Rosa v. Butterfield, 33 N. Y., 665. Nor do the sureties of a corporation. Id.; Stewart v. Bramhall, 74 N. Y., 85; Union Nat. Bk. v. Wheeler, 60 id., 612; Smith v. Alvord, 63 Barb., 415. It can not sue for the surrender of securities pledged by it as collateral to a usurious agreement. Isle of Wight Co. v. Smith, 51 Hun, 662. Corporation can not sue for surrender of securities pledged as collateral to usurious debt. Isle of Wight Co. t>. Smith, 51 Hun, 563. An action for malicious prosecution will lie against a corporation. Morton . Met. L. Ins. Co., 34 Hun, 366. It is liable for slandering the business of another corporation. Buffalo, etc., Co. t>. Standard O. Co., 42 Hun, 153 ; 106 N. Y., 669. It may be liable even when a fraudulent or malicious intent in fact is necessary to be proved. Reed t>. Home Sav. Bk., 130 Mass., 445. The fraud or malice of its authorized agents is impntable to the corporation. Id. A corporation may become a party to a conspiracy and liable for the action of all the conspirators. Dodge . Bradstreet Co., 59 How., 104 ; Morton . Met. Life GENERAL CORPORATION LAW. Ins. Co., 34 Hun, 367 ; 103 N. Y . 645 ; Rruleirtz t>. Eastern R. R. Co., 140 Mas*. 575 ; Western News Co. v. Wilmarch, 33 Kan., 510 , Buffalo L. 0. Co. v. Standard O. Co., 106 N. Y., 669. A corporation is liable for the damage resulting from a wrongful transfer of stock on the books of the company. Brisbane . D. L. & W. R. R. Co., 13 W. Dig., 1S4 ; N. Y. & N. H. R. R. Co. r. Schuyler, 34 N. Y., 30. Where the stock is, by the terms of the charter or by-laws, transferable only on the corporate books, the purchaser receiving a certificate, with power of attorney, etc., acquires the entire interest of the vendor, with ail his rights. N. Y. & N. H. R. R. Co. t>. Schuyler, 34 N. Y., 30. If he neglects to have the transfer made on the books until after such stock is transferred to a bona fide holder without notice, he loses his right to demand and have the transfer thereof made to him. Id. But the corporation will be liable to the holder of such certificate for permitting the lock to be transferred to another, where it has notice of these outstanding cer- tificate*. Id. A corporation is liable for the acts of a servant, within the general scope of hi* employment, while engaged in his master's business, and done with a view to the furtherance of that business and the master's interest, whether they *re dona negligently, wantonly or even willfully. Mott v. Consumers' Ice Co., 73 N. Y., 543 ; Buffalo L. O. Co. r. 8 0. Co., 42 Hun, 153. A pleading should allege that the acts complained of were done by the corpora- tion and not by its agents. Buffalo, etc., Co. v. Standard O. Co., 42 Hun, 153 ; StodJard r. Onondaga County, 12 Barb., 575. Promoters are liable for work done or material furnished for company on their order, in case it is never actually incorporated. Hub. Pub. Co. ?. Richardson, 87 N. Y. St. Rep., 541. Contemplated corporation is liable for work ordered by corporators for Its bene- fit. Grier v. H. H. & Co., 38 N. Y. St. Rep., 462. Corporation, not in existence at time of employment is not liable on agreement made between third party to divide commission tor services to be rendered on sale to be made by corporation. Wilbur v. N. Y. E. C. Co , 58 Super., 539. Holmes, etc., Co. v. Holmes, etc., Co.. 53 Hun, 52; Sistare r. Best, 88 N. Y., 037; Crocker . Whitney, 71 id., 170; Pratt f. Short. 79 id., 437 ; Whitney Arms Co. r. Barlow, 68 id.. 62 ; Watts-Campbell Co. v. Yuengling, 51 Hun, 302 ; Holmes, etc., v. Willard, 5 N. Y. Supp., 610; Starin . Edson, 112 N. Y., 206; Leslie v Lorillard. 110 id , 519. In action to foreclose mortgage presumption is that holders are bona fide owners and burden of showing want of consideration is upon defendant Atlantic Trust Co. v. Crystal Water Co., 72 App. Div., 539. See also A. T Co v N Y C. Suburban Water Co., 75 App. Div., 854. Defense of ultra vires must be pleaded. Hess v. W, & ]. Sloane, 66 App. Div., 522. 11. Grant of general powers. Every corporation as such hai power, though not specified in the law tinder which it is incorporated' 1. To have succession for the period specified in its certificate of in- corporation or by law, and perpetually when no period is specified. Z. To have a common seal, and alter the same at pleasure. 3. To acquire by grant, gift, purchase, devise or bequest, to hold and to dispose of such property as the purposes of the corporation shall require, subject to such limitations as may be prescribed by law. 4. To appoint such officers and agents as its business shall require, and to fix their compensation, and 5. To make by-laws, not inconsistent with any existing law, for the management of its property, the regulations of its affairs, and the transfer of its stock, if it has any, and the calling of meetings of ita members. Such by-laws may also fix the amount of stock, which must be represented at meetings of the stockholders in order to con- stitute a quorum, unless otherwise provided by law. By-laws duiy adopted at a meeting of the members of the corponition shall control n of its directors. No by-law iidop'ed by tV board of direc- tors regulating the election of directors or officers shall be valid unless 10 GENERAL CORPORATION LAW. published for at least once a week for two successive weeks in a news- paper in the county where the election is to be held, and at least thirty days before such election. Subdivisions four and five of this section shall not apply to municipal corporations. Am'd by chap. 672 of 1895. Took effect May 14, 1886. Former section 8 amended. See section 1, title 3, cfcap. 18, part I, R. S.; section 6, title 4, chap. 18, part 1, R. 8.; sections 7, 26, chap. 40 of 1848 ; section 2, chap. 611 of 1875, and chap. 172 of 1850 ; all of which are repealed. The powers of corporations are expressly limited to those specified in the statute or conferred by their charters. Matter of McGraw v. Cornell University, 45 Hun, 954 ; Halstead v. Mayor, etc., 3 N. Y., 433; Riley v. City of Rochester, 9 id., 64. The doctrine that no corporate act can be binding without being in writing 1 , or under the corporate seal, has long ceased to be maintained. Leinkauf v. Caiman, HON. Y., 50; Danforth v. Schoharie T. Co., 12 Johns., 227; Trustees, etc., v. Cagger, 6 Barb., 576; Moss v. Averell, 10 N. Y., 449. The power to purchase lands was, at common law, incident to all corporations, unless they were specially restrained by their charters or by statute. Nicoll v. N. Y. & E. R. R. Co., 12 N. Y., 121. Where a. member of a corporate body has contracted with it in its corporate capacity, neither he nor it can dispute its corporate character, if the contract has been properly executed. Whitford v. Laidler, 94 N. Y., 145 ; Eaton . Aspinwall, 19 id., 119 ; Buffalo, etc., Co. v. Gary, 26 id., 78. It is sufficient if it is a copora- tion de facto, exercising the powers and functions of a dejure corporation, and assuming to act as such. Id. Where a corporation is authorized, under some circumstances, to hold and con- vey real estate, it will be presumed, in the absence of proof to the contrary, that peal estate, conveyed by it, was held and conveyed in pursuance of its powers. Farmers' L. & T. Co. . Curtis, 7. N. Y., 466. Corporations, though limited in their duration, may purchase and hold a fee, and may sell such real estate whenever they shall find it no longer necessary or con- venient. Nicoll v. N. Y. & E. R. R. Co., 12 N. Y., 121 ; 5 Denio, 389. A by-law giving to the senior bailiff a casting vote in case of a tie, was held to be illegal. So, a by-law imposing an oath of office where none was required by the charter, was declared to be invalid. Rex v. Dean, 1 Strange, 536. So, a by-law restricting or extending the right of admission of a member, or of eligibility to office, or prescribing new or additional tests or qualifications to voters, was held to be unlawful. Id., 227. So, a by-law made by a company in a corporation, to restrain the number of apprentices to be taken by any of its members, was declared to be void. King t>. Wardens, etc., 7 Term, 540 ; King v. Tappenden, 3 East, 186. So, it baa been held that, while the number of electors might be narrowed or fixed by a by-law, the eligibility of members could not in that manner be changed. Rex v. Spencer, 3 Burr., 1827 ; People ex rel. Israel V. Tibbets, 4 Cow., 358 ; Peopl* ex rel. Barker v. Kip, id., 3S2. The directors can not pass any by-law at variance with the positive provisions of the act of incorporation. People ex rel. Barker i>. Kip, 4 Cow., 382, note. The by-laws of a corporation, made in pursuance of its special charter, or of the genei-al laws under which it is organized, are binding on all members and others acquainted with the method of doing business. Driscoll t>. West B. & C. Mfg. Co., 59 N. Y., 96. A by-law allowing the stockholders, on paying thirty per cent, on their shares, to forfeit their stock, is void as against creditors. Slee v. Bloom, 19 Johns., 456. But a by-law, that any stockholder paying fifty per cent, on his shares, shall b discharged from all future calls on his subscription, etc., other than proceeding by way of forfeiture was held to be valid. Id. An incorporated company has no power to make a by-law, subjecting to forfeit- ure shares owned by individuals in the stock of the company for the non-payment ef installments due upon such shares, unless the power to pass such by-law ia ex- preasly granted by its charter or act of incorporation. Matter of Long- I. R. R. Co., 19 Wend., 37. A by-law declaring that the ordinary business of the corporation may be trans- acted by a quorum of five directors, the whole number being twenty-three, Li a valid regulation. Hoyt v. Thompson's Executors, 19 N. Y., 207. Such by-Uw 11 GENERAL CORPORATION LAW. embraces the general business of the corporation, including as incident thenstc the power of pledging or assigning its assets for the purpose of securing a debt, Id. By-laws, which forbid a member to work at his trade at such prices as h< chooses to accept, and compel him to join in a "strike" by punishing him for re- fuaing to do so, are void as ag-aiust public policy. People ex rel. Doyle v. N. Tt Ben. Soc., 3 Hun, 361. Every by-law, made in pursuance of a general or incidental authority, moat N a reasonable one. Driscoll v. West B. & 0. Mfg. Co., 69 N. Y., 96. It is not a reasonable by-law, which, without authority express or to be clearly implied, in- terferes with the common rights of property and the dealings of third persons, and prevents the purchase or delivery of property. Id. A corporation has no power, in the absence of a provision to that effect in its ar- ticles of association, to create or declare a lien upon its stock by by-lavr, or ic refuse to permit a transfer until the indebtedness of the stockholder to the com- pany is paid. Id. A bonafide purchaser of stock, without knowledge or notice ol such a by-law, is not bound by it. Id. lie can compel the transfer to him, upon the books of the corporation, of the stock purchased. Id. But does not section 96 of chap. 664 of 1890 authorize such by-law with the proviso therein mentioned ! In the absence of some power to change the relative value of the shares' conferred by statute on the articles of association, no change can be made without the con- sent of all the stockholders. Campbell v. American Zylonite Co., 122 N. Y., 455 : Kent v. Quicksilver M. Co., 78 id., 159. Rudolph r. Southern B. League, 23 Abb. N. C., 199; Austin r. Searing. 16 N. Y., 112; Protective Ass'n v. McGrath, 23 N. Y. St. Rep., 209; Loubat v. Le Roy, 15 Abb. N. C., 20; Lafond v. Deems, 81 N. Y., 514; People v.' Society. 32 id., 194. Power of president to bind corporation. See Curtis v. Notalie Anthracite Coal Co., 39 Misc., 586. President resigning has right to demand that he be relieved of his stock. Joseph v. Raff. 82 App. Div., 47. See also Zeltner v. Henry Zeltner Brewing Co., 174 N. Y., 247. By-law requiring consent of 90 per cent, of stockholders to change number of directors, is invalid. 'Katz w. H. & H. Mfg. Co., 109 App. Div. 49. 12. Enlargement of limitations upon the amoniit of the property of non-stock corporations. If any general or special law heretofore pa'ssed, or any certificate of incorporation, shall limit the amount of property a cor- poration other than a stock corporation may take or hold, such corporation may take and hold property of the value of three million dollars, or less, or the yearly income derived from which shall be five hundred thousand dollars or less, notwithstanding any >uch limitations. In computing the value of such property, no increase in value arising otherwise than from improvements made thereon shall be taken into account. Am'd by chap. 400 of 1894. Went into effect May 3, 1894. 13. Acquisition of additional real property. When any corporation t a lifo insurance corporation, shall have sold or conveyed any part of its real property, the supreme court may, notwithstanding any restriction of a : i] nr special law. authorize it to purchase and hold from time to time other real property, upon satisfactory proof that the value of the property so purchased does not exceed the value of the property so sold and conveyed within the three years next preceding the application. Am'd by chap. 228 of 1906. In effect April 12, 1906. Pormer action 10 amended, 14. Acquisition of property without the state. Any domestic corporation t' l.ii.-inc-- in > tea or foreign countries may acquire and dispo-c of such property as sh;ill he requisite for such corpora- tion in the convenient transaction -ine*s. Any domestic- corporation establishing or maintaining a charit :iliic. philanthropic or educational insti- tution within tin- -tate may a No can\ on its work and establish or maintain one or more branches of such institution or .:n additional institution or addi- tonal institution.- in any other -late, the Di.-t.rict of Columbia or in any of the terrii -i-'pendcneies of the United States of America or in any foreign country and for either of .said purposes may take by devise or bequeat^ hold, pureha-. . 1 and convey or otherwise dispose of sucu real and per-onul property \\ithout this state as may be requisite therefor. But nothing in thi- -Action contained shall lie construed as exempting from : tion y additional amount, than is no\v allowed to siu-h cor;. 12 GENERAL CORPOIIATION LAW. Former section 11 amended. See section 1, chap. 146, of 1872, and section 1, chap. 361. of 1882, now repealed. Am'd by ch. 178 of 1903. In effect April 14, 1903. If such other state does not permit the corporation to acquire or hold ral property, it can nut be inferred, but must b expressed in some affirma- tive way. Cowell v. Springs Co., 100 U. S. 55. 15. Certificate of authority of a foreign corporation. No foreign stock corporation otner than a monied corporation, shall do business in this state without having first procured from the Secretary of State a certificate that it has complied with all the requirements of law to authorize it to do business in this state, and that the business of the corporation to be carried on in this state is such as may be lawfully carried on by a corporation incor- porated under the laws of this state for such or similar business, or, if more than one kind of business, by two or more corporations so incorporated for such kinds of business respectively. The Secretary of State shall deliver such cer- tificate to every such corporation so complying with the requirements of law. No such corporation now doing business in this state shall do business herein after December thirty-first, eighteen hundred and ninety-two, without having procured such certificate from the Secretary of State, but any lawful contract previously made by the corporation may be performed and enforced within the state subsequent to such date. No foreign stock corporation doing business in this'state shall maintain any action in this state upon any contract made by it in this state unless prior to the making of such contract it shall have procured such certificate. This pro-' hlbition shall also apply to any assignee of such foreign stock corporation and to any person claiming under such assignee or such foreign stock corporation or under either of them. No certificate of authority shall be granted to any foreign corporation having the same name as an existing domestic corporation, or a name so nearly resembling it as to be calculated to deceive, nor to any foreign corporation, other than a moneyed or insurance corporation, with the word "trust," "bank," "banking," "insurance," "assurance," "indem- nity," "guarantee," "guaranty," "savings," "investment," "loan," or "benefit," as a part of its name. Amended by ch-. 538 of 1901. In effect September 1, 1901. This section was also amended by ch. 96 of 1901. Amended by ch. 490 of 1904. Corporation may sue on a contract made in 1900 though its certificate was not obtained until 1902. Lewis Vub. Co. v. Lenz., 86 App. Div., 451. See Onderdonk v. Peale & Co., 104 App. Div. 195. So. Amboy & Co. v. Poerschke, 45 Misc. 353. " Doing business in this state " means the continuous transaction of busi- Mes. Penn. Collieries Co. v, McKeever, 183 N. Y. 98, aff'g 93 App. Dir. 303. 16. Proof to be filed before granting certificate. Before granting such certificate the secretary of state shall require every such foreign corporation to file In his office a sworn copy in the English {language of its charter or certifi- cate of incorporation, and a statement under its corporate seal particularly set- ting forth the business or objects of the corporation which it is engaged in carry- ing on or which it proposes to carry on within the State and a place within the State which is to be its principal place of business, and designating in the manner prescribed in the code of civil procedure a person upon whom process against the corporation may be served within the State. The person so designated must have an office or place of business at the place where such corporation is to have its principal place of business within the State. Such designation shall continue in force until revoked by an instrument in writing designating in like manner some other person on whom process against the corporation may be served in this State. If the person so designated dies or removes from the place where the corporation has its principal place of business within the State, and the cor- poration does not within thirty days after such death or removal designate in like manner another person upon whom process against it may be served 13 GENERAL CORPORATION" LAW. within the State, the secretary of state may revoke the authority of the corporation to do business within the State, and process against the corporation in an action upon any liability incurred within thig State before such revocation, may, after such death or removal, and before another designation is made, be served upon the secretary of state. At the time of such service the plaintiff shall pay to the secre- tary of state two dollars, to be included in his taxable coats and dis- bursements, and the secretary of state shall forthwith mail a copy of gnch notice to such corporation if its address, or the address of any officer thereof, is knowu to him. Amended by cii. r,7u , i l>$tr>. Took effect May 14, 1895. See International So.-, r. Dennis, 76 App. Div., 327. 17. Acquisition of real property in this state by certain foreign corporations. Any foreign corporation created under the laws of the United States, or of any state or territory thereof, and doing business in this state, may acquire such real property in thia state as may be necessary for its corporate purposes in the transaction of its business in this state, and convey the same by deed or other- wise in the same manner as a domestic corporation. Former section 12 amended. See section 1, chap. 460 of 1887, now repealed. The policy of a state may exclude foreign corporations from acting within itit jurisdiction, and such policy may be clearly established by a reference to its general legislation. Demarest v. Flack, 128 N. Y., 205. It is not necessary for a state to do so expressly by statute. Id. But no such policy is found in the laws of our state. Id. A corporation, formed in another state, by citizens of this state for the purpose of transacting business here, is not excluded from recognition by the courts of this state, unless it is formed to do acts prohibited by the laws of the state to its own citizens or corporations. Id. If it is legally incorporated and entitled to recognition in the courts of the state where it was organized, it is entitled to recognition and protection in the tribunals of this state. Id. Th power rests exclusively with the legislature to say whether any, and, if BO, what terms shall be imposed upon such a corporation as a condition of its doing business here. Id. The absence of such terms furnishes no ground for refusing to recognize it. Id. Court has no jurisdiction to interfere with internal administration of affairs of foreign corporations. Berford v. New York I. Mine, 56 Supr.,236. ion 1780 of Code does not violate section 2, art. 4, of Federal Constitution. Robinson v. Ocean S. N. Co., 20 N. Y. St. Rep., 741. 18. Acquisition by foreign corporation of real property in this state. Any foreign corporation may purchase at a sale upon the foreclosure of any mortgage held by it, or, upon any judgment or decree for debts due it, or, upon any settlement to secure such debts, any real property within this state covered by or subject to such mortgage, judgment, decree or settlement, ana may take by devise any real property situated within thia state and hold the same for not exceeding five years from the date of such purchase, or from the time when the right to the possession thereof vests in such devi- see, and convey it by deed or otherwise in the same manner as a domestic corporation. Am'd by chap. 186 of 1804. Took effect March 15, 1804. 14 GENERAL CORPORATION LAW. 19. Prohibition of banking powers. No corporation except a corporation formed under or subject to the banking laws, shall by any implication or construction be deemed to possess the power of carrying on the business of discounting bills, notes or other evidences of debt, of receiving deposits, or buying and selling bills of exchange, or shall issue bills, notes or other evidences of debt for circulation as money. Former section 14. See section 4, title 3, ch. 18, part 1, R. S. now repealed. Amended by ch. 236 of 1904. In effect April 5, 1904. It is the settled policy of the legislature to prevent corporations, which are no* formed for banking 1 business, from carrying on, or in any manner interfering' with the same. N. Y. State L. & T Co. v. Helmer, 77 N. Y., 64. The courta are bound to carry out the law and to see that it is not violated. Id ; Utica Ins. Co. . Scott, 19 Johns., 1; People v. Utica Ins. Co., 15 id., 358; N. Y. Firemen Ins. Co. t>. Ely, 2 Cow., 678; N. Y. L. Ins. Co. v. Beebe. 7 N. Y., 364 ; Talmadge v. Pell, id., 328 ; Utica Ins. Co. v. Kip, 8 Cw., 20; Oneida Bk. . Ontario Bk., 21 N. Y., 490. Certificates of deposit irredeemable within twenty years and bearing interest, issued as loans by the New York Life Insurance and Trust Company, were held to be violations of the former statute upon this subject. N. Y. Life Ins. & T. Co. v. Beebe, 7 N. Y., 364. The prohibition of this section extends to foreign corporations. Amer. L. Ins. & T. Co. v. Dobbin, Hill and Denio, 252. But such corporation is not prohibited by it, from purchasing promissory notes. Id. The penalty or forfeiture declared in the statute, and no other, will be enforced. Pratt v. Short, 79 N. Y., 437. It was not intended that all claims to money loaned or advanced upon the prohibited security should be forfeited. Id; Davis 8. M. Co. v. Best, 30 Hun, 638; Rome Savings Bk. v. Krug, 102 N. Y., 331 ; N. Y. St. L. & T. Co. v. Helmer, 77 id., 64 ; Rome Sav. Bk. v. Kramer, 32 Hun, 270 ; Pratt t>. Eaton, 79 N. Y. f 449. The history of the restraining acts is given, and the authorities on the subject collated, in Pratt v. Short, 79 N. Y., 437. See Utica Ins. Co. v. Caldwell, 3 Wend., 296 ; Same v. Bloodgood, 4 id., 652; Mercein v. People, 25 id., 64; Tracy tj. Tal- mage, 14 N. Y., 189 ; Curtis v. Leavitt, 15 id., 97; Atlantic State Bk. v. Savery, 82 N. Y., 291. See further, Crocker v. "Whitney, 71 N. Y., 161. 20. Qualification of members as -voters. Unless otherwise provided in the certificate of incorporation, every stockholder of record of a stock corpora- tion shall be entitled at every meeting of the corporation to one vote for every share of stock standing in his name on the books of the corporation ; and at every meeting of a non-stock corporation, every member, unless disqualified by the by-laws, shall be entitled to one vote. The stockholders of a stock corporation, by a by-law adopted by vote at any annual meeting, or at any special meeting duly called for such purpose, may prescribe a period, not exceeding forty days prior to meetings of the stockholders, during which no transfer of stock on the books of the corporation may be made. Except in cases of express trust, or in which other provision shall have been made by written agreement between the parties, the record holder of stock which shall be held by him as security, or which shall actually belong to another, upon demand therefor and payment of necessary expenses thereof, shall issue to such pledger or to such actual owner of such stock, a proxy to vote thereon. The certificate of incorporation of any stock corpora- tion may provide that at all elections of directors of such corporation, each stock- holder shall be entitled to as many votes as shall equal the number of his shares of stock multiplied by the number of directors to be elected, and that he may cast all of such votes for a single director or may distribute them among the number to be voted for, or any two or more of them as he may see fit, which right, when exercised, ehall be termed cumulative voting. The stockholders of a corporation heretofore formed, wlio by tiie provisions of laws existing on April thirty, eighteen 15 GENERAL CORPORATION LAW. hundred and ninety-one, were entitled to the exercise of such right, may hereafter exercise such right according to the provision of this section. A stockholder may, by agreement in writing, transfer his Btock to any person or persona for the purpose of vesting in him or them the right to vote thereon for a time not exceeding five years upon terms and conditions stated pursuant to which such person or persons shall act ; every other stockholder, upon his request therefor may, by a like agreement in writing also transfer his stock to the same person or persons and thereupon may participate in the terms, conditions and privileges of such agreement ; the certificates of stock so transferred shall be surrendered and cancelled and certificates therefor issued to such transferee or transferees in which it shall appear that they are issued pursuant to such agreement and in the entry of such transferee or transferees as owners of such stock in the proper books of said corporation that fact shall also be noted and thereupon he or they may vote upon the stock so transferred during the time in such agreement specified ; a duplicate of every such agreement shall be filed in the office of the corporation where its principal business is transacted and be open to the inspection of any stockholder, daily, during business hours. No member of a corporation shall sell hi* vote or issue a proxy to vote to any person for any sum of money or any thing of value. The books and papers containing the record of membership of the corporation shall be produced at any meeting of its members upon the request of any member. If the right to vote at any such meeting shall be challenged, the inspectors of election, or other persons presiding thereat, shall require such books, if they can be had, to be produced as evidence of the right of the person challenged to vote at such meeting, and all persons who may appear from such books to be members of the corporation may vote at such meeting in person or by proxy, subject to the provisions of this chapter. Amended by ch, 855 of 1901. In effect April 16, 1901." 21. Proxies. Every member of a corporation, except a religiou* jorporation, entitled to vote at any meeting thereof may BO vote b} proxy. No officer, clerk, teller or bookkeeper of a corporation formed undet or subject to the banking law shall act as proxy for any stockholder at any meeting of any such corporation. Every proxy must be executed in writing by the member himself, or by his duly authorized attorney. No proxy hereafter made shall be valid after the expiration of eleven months from the date of its execu- tion unless the member executing it shall have specified therein the length of time it is to continue in force, which shall be for some limited period. Every proxy shall N* revocable at the pleasure of the person executing it ; but a corporation having no capital stock may prescribe in its by-laws the persons who may act as proxies for members, and the length of time for which proxies may be executed. Part of section 54 of stock corporation law amended. 22. Challenges. Every member of a corporation offerm b M vote at any election or meeting of the corporation shall, if required by an inspector of election or other officer presiding at such election or meeting, or by any other member prm-ut. take and subscribe the following oat % : "I do solemnly sweur thai in voting at this election t have not, either diiecdy, indirectly 01 impliedly. received any 16 GENERAL CORPORATION LAW. promise or any sum of money or anything of value to influence the giving of my vote or votes at this .meeting or as a consideration there- for." Any person offering to vote as proxy for any other person shall present his proxy and, if so required, take and subscriba .the following oath : " I do solemnly swear that I have not, either ' directly, indirectly or impliedly, given any promise or any sum of money or anything of value to induce the giving of a proxy to me to vote at this election, or received any promise or any sum of money or anything of value to influence the giving of my vote at this meeting, or as a consideration therefor." The inspectors or per- sons presiding at the election may administer such oath, and all such oaths and proxies shall be filed in the office of the corporation. Amended by ch. 355 of 1901. In effect April 16, 1901. 23. Effect of failure to elect directors. If the directors shall not be elected on the day designated in the by-laws, or by-law, the corporation shall riot for that reason be dissolved ; but every director shall continue to hold his office and discharge his duties until his suc- cessor has been elected. Former section 18. See section 27, chap. 611 of 1875, now repealed. A corporation is not dissolved because of the failure to eleut trustees, where it ia declared that such omission shall not produce ite devolution. People v. Twaddell, 18 Hun, 427. The failure of a board of trustees to adopt by-laws prescribing the time, place and manner for the annual election of trustees, or to hold such election, dos not dissolve the corporation. Matter of Vandenburgh v. Broadway Ry. Co., 29 Hun, 348. This section expressly provides for such omission. On the dissolution of a corporation, the title to real estate held by it reverU back to its original grantor and his heirs, unless there is some provision in the charter, or some other statutory provision, to avert that consequence. Binghara v. Weiderwax, 1 N. Y., 509. Webster v. Turner, 12 Hun, 264; Brooklyn 8. T. Co. v. City of Brooklyn. 78 N. Y., 524 ; Kincaid v. Dwinelle, 59 id., 548 ; Central Sav. Inst., 5 Hun, 34 ; 66 N. Y., 424; Chamberlain . Rochester 8. P. V. Co., 7 Hun, 557; People v. Albany & V. R. R. Co., 77 N. Y., 232 ; rev'g, 15 Hun, 128 ; Atty.-Gen. v. N. A. L. Ins. Co., 77 17 GBICBRAL CORPORATION LAW. N. Y., 297; rer'g, IB HUD, 18 ; Er Parte French Mfg. Co., 13 id., 488; Medbury 9. Rochester P. 8. Co., 19 id., 498 ; KittredgetJ. Kellogg B. Co., 8 Abb. N. C., 168 ; Denicke . N. Y. & R. L. & C. Co., 80 N. Y., 599; Belknap v. N. A. L. Ins. Co., 11 Hun, 282 ; Cole v. Knickerbocker L. Ins. Co., 23 id., 255 ; Frothingham t>. Barney, 6 id., 366 ; Ex Parte W. T. Skirt Co., 8 id., 608 ; People t>. Nat. Trust Co., 82 N. Y., 283; Central C. R. R. Co. t). 23d St. R. R. Co., 54 How., 168; Matter of N. Y. E. R. R. Co., 70 N. Y., 327 ; People t>. Hektograph Co., 10 Abb. If. C., 358 ; Ex Part* Pyrolusite M. Co., 29 Hun, 429. 24. Mode of calling special election of directors. If the lection has not been held on the day so designated, the directors shall forthwith call a meeting of the members of the corporation for the puri pose of electing directors, of which meeting notice shall be given in the same manner as of the annual meeting for the election of directors. If such meeting shall not be so called within one month, or, if held, hall result in a failure to elect directors, any member of the corpora- tion may call a meeting for the purpose of electing directors by pub- liihing a notice of the time and place of holding such meeting at least once in each week for two successive weeks immediately preceding the election, in a newspaper published in the county where the election is to be held and in such other manner as may be prescribed in the by- laws for the publication of notice of the annual meeting, and by serv^ ing upon each member, either personally or by mail, directed to him at his last known post-office address, a copy of such notice at least two weeks before the meeting. Transferred from stock corporation law, sections 53, 54 and 55. 25. Mode of conducting special elections of directors. Such meeting shall be held at the office of the corporation, or if it has none, at the place in this state where its principal business has been transacted, or if access to such office or place is denied or can not. 1 o had, at some other place in the city, village or town where such office or place is or was located. At such meeting the members attending shall constitute a quorum. They may elect inspectors of election and directors and adopt by-laws providing for future annual meetings and election of directors, if the corporation has no such by-hi\vs, and transact any other business which may be transacted at an annual meeting of the members of the corporation. Id. 26. Qualification of voters and canvass of votes at special lections, In the absence at such meeting of the books of the cor- poration showing who are members thereof, each person, before voting, hall present his sworn statement setting forth that he is a member of the corporation ; and if a stock corporation, the number of shares of took owned by him and standing in his name on the books of the cor- poration, and, if known to him, the whole number of shares of stock of 18 CORPORATION LA.W. the corporation outstanding. On filing such statement, he may vote M a member of the corporation ; and if a stock corporation, he may vote on the shares of stock appearing in such statement to be owned by him and standing in his name on the books of the corporation. The inspectors shall return and file such statements, with a certificate of the result of the election, verified by them, in the office of the clerk of the county in which such election is held, and the persons so elected shall be the directors of the corporation. Id. 27. Powers of supreme court respecting elections. The su- preme court shall, upon the application of any person or corporation aggrieved by or complaining of any election of any corporation, or any proceeding, act or matter touching the same, upon notice thereof to the adverse party, or to those to be affected thereby, forthwith and in a summary way, hear the affidavits, proofs and allegations of the parties, or otherwise inquire into the matters or causes of complaint, and estab- lish the election or order a new election, or make such order and gire such relief as right and justice may require. Former section 16. See section 5, title 4, chap. 18, part 1, R. 8.. now repealed. No one but a party named as aggrieved in the notice of application to Bet asida the election, is entitled to be heard. Matter of Mohawk & H. R. R. Co., 19 Wend., 135. A corporation has the right, under this section, to make application to tb supreme court, for the purpose of establishing an election of its trustees, who hare been declared elected, or to have the election set aside and a new election ordered. Matter of Pioneer Paper Co., 36 How.. 111. On such application, notice to the persons who claim to have been elected, and to the corporation, if not made by it, is sufficient. Schoharie Valley R. R. Co., II Abb., N. 8., 394. It is not necessary that all the stockholders have notice of th application. Id. This section does not authorize any person whomsoever, who chooses to make * complaint, to institute the proceeding. Matter of Application of Syracuse, C. &N. T. R. R. Co., 91 N. Y., 1. But it must be some person, whose rights have been in- fringed, and who is justly entitled to complain. Id. Where an application is made, under this section, to settle contests arising out of R. disputed election, the court may go behind the entries in the transfer book of th* company, and determine whether a transfer appearing thereon was a sale or only a pledge of th shares, and whether the pledger or pledgee waa entitled to vote thereon. Matter of'Btrong v. Smith, 15 Hun, 222. The continuous neglect of corporation, for a number of years, to hold any elec- tion of officers, affords a proper case for the issue of a mandamus on the relation of a corporator, without proof of a special request to the directors to hold an election. People ex rel. Walker t>. Albany Hospital, 11 Abb., N. 8., 4. A mandamus will lie to compel an election of the officers of a corporation, other than municipal, if a proper case is made. People ex rel. Walker v. Albany Ho- pital, 11 Abb., N. 8., 4. 28. Stay of proceedings in actions coUusively brought. If an action is brought against a corporation by the procurement or default of its directors, or any of them, to enforce any claim or obligation de- clared void by law, or to which the corporation has a valid defense, IP QBWBRAL CORPORATION LAW. and Buch action is in the interest or for the benefit of any director, and the corporation has by his connivance made default in such action, or consented to the validity of such claim or obligation, any member of the corporation may apply to the supreme court, upon affidavit, set- ting forth the facts, for a stay of proceedings in such action, and on proof of the facts in such further manner and upon such notice as the court may direct, it may stay such proceedings or set aside and vacate the same, or grant such other relief as may seem proper, and which will not injuriously affect an innocent party, who, without notice of auch wrongdoing and for a valuable consideration, has acquired rights under such proceedings. Former section 1C amended. See section 4, chap. 151 of 1870, now repealed. Stockholders may assert and maintain rights of company, when it is in no position to assert its rights, and Buch rights are suffered to remain unenforced. Barr . N. T. L. E. & W. R. R. Co., 126 N. Y., 263. When one trustee may bring suit for accounting on behalf of the corporation Eecamier Mfg. Co. v. Seymour, 15 Daly, 245. Action may be maintained, where proper case shall be disclosed, by stockholders, or others interested in property of corporation, to vindicate and sustain righto of Company alone, against alleged misconduct of its directors. Rogers v. Phelps, 81 K. Y. St. Rep., 872. But such action can not be maintained, where there is no diversion authorized, which will, in any manner, diminish or impair rights or interests of stockholder* themselves in assets or property of company. Id. Action against corporation to influence corporate action, can not be main- tained. Thomas t>. M. M. P. Union, 121 N. Y., 45. Equity interferes only in case of irreparable injury or inadequate remedy at law. Id. Action will not lie to declare certain by-laws void, and prevent enforcement. Id. Stockholder's action lies without previous application to officers to sue, where object is relief from their own misconduct. Mayers v. Scott, 20 N. Y. St. Rep., 86. So, such application is unnecessary, where action is to protect rights of indi- vidual shareholders suing, as distinguished from those of corporation. Id. Mere creditor of stockholder and of corporation can not maintain action to avoid transfer by company. Berford v. New York I. Mine, 56 Super., 236. Complaint held to state facts constituting cause of action against directors of corporation, for alienation or threatened alienation of corporate property. Phoenix Nat Bk. v. Clev. Co., 34 N. Y. St. Rep., 498. Complaint, in action by stockholders, held sufficient to entitle them to equitable relief against fraudulent conduct of officers of corporation. Meyers v. Scott, 20 N. Y. St. Rep., 35. When action by creditor and shareholder against directors for misconduct, injunc- tion nendente lite, proper. Hoyt v. Malone, 31 N. Y. St. Rep., 789. Where necessity for injunction exists, courts of this state may enjoin corpora- tion, formed under its laws, from proceeding in action pending in another state. Gibson v. A. L. & T. Co., 58 Hun, 443. Facts held sufficient to justify continuing injunction to restrain collection of Judgments against insolvent companies. Pierce . Mayer, 36 N. Y. St. Rep., 829. Right of resident stockholder, to maintain action for injunction against foreign corporation. lyes t>. Smith, 28 N. Y. St. Rep., 917. When injunction pmdente lite will be continued. Id. Action may be maintained against receiver of corporation, for tort committed before his appointment. Decker t>. Gardner, 83 N. Y. St. Rep., 641. Summons cannot be served upon assistant treasurer of domestic corporation. Winslow v. Staten I. P. T. Co., 61 Hun, 298. Person, who receives and handles all money received by foreign corporation in ttua state. i cashier within meaninr of section 433 of Code. McCulloh . P. N. W. Co., 88 N. T. St. Rep., 406. 20 GENERAL CORPORATION LAW. R. R. Co., 115 N. Y., 437. Service of summons upon general superintendent of telephone company is rood. Barrett v. Amer. T. & T. Co., 56 Hun, 430. When service of summons on director of corporation sufficient. McElroy C. R Co., 25 N. Y. St. Rep., 834. Person, on whom service is made, must be either officer or managing agent of corporation. Sturges v. C. J. Mfg. Co., 32 N. Y. St. Rep., 848 ; aflPd 38 id., 1028. Fact that he resigned on purpose to avoid does not prevent service. Id. Where no legal resignation of directoi-s of business corporation has been made they remain such officers within the meaning of section 431 of Code. Carnaghan v. E. & P. 0. Co., 32 N. Y. St. Rep., 1117. Section 9, chap. 195 of 1846, does not authorize service upon director of de- fendant of summons of kind prescribed by Code. Quade v. N. Y., N. H. & H. R. R. Co., 39 N. Y. St. Rep., 157. Authority of cashier or other officer of bank terminates at end of its corporate existence. Hayden v. Bank of Syracuse, 36 N. Y. St. Rep., 899. After such event, service of summons, etc., upon former cashier does not con- stitute service upon corporation. Id. Defunct bank can not be sued. Id. Service of summons on former director, after he has sold his stock and new set of directors been selected, is nullity. Beardsley v. Johnson, 121 N. Y., 324. Service of summons on attorney of corporation, whose appointment for such purpose never became operative to knowledge of plaintiff, will be set aside. Richardson v. W. H. Ins. Co., 29 N. Y. St. Rep., 820. Individual name of superintendent of insurance need not be inserted in his appointment as attorney under chap. 346 of 1884. Lafflin v. T. Ins. Co., 81 N. Y. St. Rep., 900 ; rev r g 30 id., 1021. Phrase " or his successor in office " may be added to his title. Id. Appointment need not be authenticated in any particular manner, or so as to entitle it to be read in evidence. Id. What proof necessary to support action by tax payer to restrain supervisor from paying highway commissioner's bills. Warrin v. Van Nostrand, 21 N. Y. St. Rep., 960. Tax payer's action will be dismissed when brought actually in interest of pri- vate claimant and not for relief of tax payers. Kimball v. Hewitt, 15 Daly, 124. When tax payer's suit can be maintained to prevent signing of contract by ma- nicipal authorities. Armstrong v. Grant, 56 Hun, 226. Action by tax payer to restrain city, under chap. 531 of 1881, can not be main- tained, where bid was lowest and made in good faith. Boyle v. Grant, 36 N. Y. St. Rep., 207. Untrue statement in bid not made with intent to deceive or mislead city authori- ties, and known before acceptance, furnishes no ground for judicial interference. Id. Action by tax payer to restrain action of common council, within its power and discretion, can not be maintained, without charge of fraud, collusion, corruption of bad faith. Talcott v. Buffalo, 125 N. Y., 280. That officer has not passed civil service examination is not ground for tax payer's suit. Peck v. Belknap, 55 Hun, 91. Appreciable wronger substantial injury must be shown. Id. Lamp superintendent is not subordinate officer, etc., within meaning of civil ser- vice act. Id. Zieglerv. Hoagland, 52 Hun,. 385; Butts v. Wood, 37 N. Y.,317; Ogden v. Mur- ray, 39 id., 202 ; Beveridge v. N. Y. E. R. R. Co., 112 id., 1, 28 ; Meyers v. Scott, 20 N. Y. St. Rep., 35 ; Stromeyer v. Combes, 18 id., 154 ; Allen v. Railroad Co., 49 How., 14 ; Smith v. Rathbun, 66 Barb., 402 ; Dinsmore . Railroad Co., 46 How., 193 ; Greaves v. Gon fe e, 54 id., 272 ; Meyer v. Scott, 20 N. Y. St. Rep., 35 ; Smith v. Rathbun, 22 Hun, 150 ; Brinckerhoff v. Bostwick, 88 N. Y. 52 ; Currier v. Bail- road Co., 35 Hun, 855; Barr v. Same, 96 N. Y., 444. 29. Quorum of directors and powers of meyority. Th affairs of every corporation shall be managed by its board of directors, 21 GENERAL CORPORATION LAW. at Teaet one of whom shall be a resident of this state. Unless other- provided by law a majority of the board of directors of a corpo- ;i at a meeting duly assembled shall be necessary to constitrite a quorum for the transaction of business, and the act of a majority of the directors present at a meeting at which a quorum is present shall be the act of the board of directors. The members of a corpo- ration may in by-laws fix the number of directors necessary to con- stitute a quorum at a number less than a majority of the board, but at least equal to one-third of its number. Subject to the by-laws; if any adopted by the members of a corporation, the directors may make necessary by-laws of the corporation. Amended by eh. 214 of 1901. In effect March 28, 1901. Amended by ch. 757 of 1904. Former section 17 amended. See section 6, title 3, chap. IS, part 1, R. 8.; and section 10, chap. 611 of 1876, now repealed. Where a statute authorizes a select body of men to make by-laws, rules and regulations, a majority of that body at least is necessary to constitute a quorum. ET parte Wilcock, 7 Cow., 402. Words in such a statute, directing that a majority of thoae present at a regular meeting shall be competent to do business, can not l>e construed as authorizing a minority of such body to act. Id. Where a member of a board of directors presents to such board a bill for extra oompensation as secretary, he is disqualified from acting upon the auditing of such bill. Butts v. Wood, 37 N. Y., 317. And if he must be included to constitute a quorum, the board so constituted is not qualified to act upon such bill so as to bind, the corporation. Id. Shareholder has legal right, at meeting, to vote upon measure, even though he has personal interest therein separate from other shareholders. Gamble v. Queens Co. W. Co., 123 N. Y., 91. What conduct of majority necessary to warrant interference of court in favor of minority. Id. 30. Directors as trustees in case of dissolution. Upon the dissolution of any corporation, its directors, unless other persons shaM be appointed by the legislature, or by some court of competent juris- diction, shall be the trustees of its creditors, stockholders or members, and shall have full power to settle its affairs, collect and pay outstand- ing debts, and divide among the persons entitled thereto the money and other property remaining after payment of debts and necessary ex- penses. Such trustees shall have authority to sue for and recover the debts and property of the corporation, by their name as such trustees, and shall jointly and severally be personally liable to its creditors, stock- holders or members, to the extent of its property and effects that shall oome into their hands. Former sections 19 and 20 consolidated. Bee section 9, title 3, chap. 18, part 1, R. 8., now repealed. See section 10, title 3, chap. 18, part 1, R. 8., section 3, chap. 67 of 1811, and section 3, chap. 40 of 1848, now repealed. The provision now in force, declaring that, onth e dissolution of a corporation, the directors, unless some other person shall be designated, shall be trustees of ite -ts. .nd .i^titiiti-s ih" directors the trustees to Uko rharirH of them for the i i Id. Th<- creditors of dissolved corpora!'!" lien on the aMeta for the payment of their debts. Id. Where 22 GENERAL CORPORATION LAW. a fund exists in this state which our own citizens are entitled to have applied to the payment of their debts, the courts will detain and appropriate the fund, but will not disregard the rights of other parties. Id. Upon the dissolution of a corporation, its remaining trustees become vested with the title of its property, and responsible to its creditors and stockholders for tae value thereof. Peoples. O'Brien, 111 N. Y., 1 ; Dash v. Van Kleick, 7 Johns., 477. The trustees succeed to all the rights and privileges of directors and to the same means of defense. Kain v. Bloodgood, 7 Johns. Ch., 90, 128. All the property and rights of the corporation become vested in the directors then in office, unless the repealing act provides for the appointment of other persona than its officers aa trustees. McLaren -. Pennington, 1 Paige, 102. The directors or managers, upon the dissolution of a corporation, become trustee* of its property, unless some other custodian is appointed, for the purpose of pay- ing its debts and dividing its property among its stockholders. Heath v. Barmore, 50 N. Y., 305 ; Towar v. Hale, 46 Barb., 361. The above section applies as well to the real estate as to the personal property of corporations. Id. The legal title vests in the body corporate during its life, and, upon its dissolution, in the trustees in office at the time, in trust for the creditors and stockholders. Central City Sav. Bk. v. Walker, 66 N. Y., 428. There is nothing in this section to restrict its provisions to personality. Owen v n Smith, 31 Barb., 641. The equity of the creditors and stockholders is the same in respect to all species of pi-operty. Id. Upon the dissolution of a corporation, the title to real property held by it does not revert to the original proprietors and grantors, or their heirs, but vests in the receiver of the corporation. Id. The property, real and personal, is to be administered by him for the benefit of creditors and stockholders. Id. Upon the dissolution of a corporation, at common law, all its real estate unsold reverted back* to the original grantor or his heirs ; the debts to and from the cor- poration were extinguished, and all the personal estate of the corporation vested in the people. Huntley v. Beecher, 30 Barb., 580. But, in this state, these conse- quences are guarded against by statute. Id. The rule at common law does not prevail here. Where lands are conveyed ab solutely to a corporation having stockholders, no reversion or possibility of * reverter remains in the grantor. Heath v. Barmore, 50 N. Y., 302. The charter of a dissolved corporation may be extended by a legislative act. Huntley v. Beecher, 30 Barb., 580. In such case, it retains its property, and re- mains liable upon its obligations. Id. The provisions of this section apply to all corporations created or to be created. Towar v. Hale, 46 Barb., 361. They preclude the idea of land reverting to the original grantor, until at least all the debts owing by the corporation are paid. Id. This section expressly limits the liability of the directors as trustees, upon the dissolution of the corporation, to the extent of the property and effects that shall come into their hands. Hoffman v. Van Nostrand, 42 Barb., 174. They are not liable for the value of stock to one who had deposited it as collateral security with the corporation, which had been sold by it previous to its dissolution. Id. Upon the dissolution of a corporation, the directors then in office become trus- tees to settle up its affairs, and suits must then be commenced in the names of such trustees. Lond. I. F. Co. v. Terbell, 48 N. Y., 427. Where the charter of a corporation expires by its own limitation, while an action for a tort is pending against it, the court has power to continue the action against the statutory trustees under this section. Hepworth v. Union Ferry Co., 62 Hun, 257. The statute creditor embraces those persons whose claims are based upon torts. Id. It is a general principle that a cause of forfeiture cannot be taken advantage of, or enforced, against a corporation collaterally, or incidentally, or in any other mode than by a direct proceeding for that purpose against the corporation, o that it may have an opportunity to answer. Towar v. Hale, 46 Barb., 361. Where the state seeks by action to destroy the life of a corporation, it must, it seems, show some gra\ 9 misconduct, on the part of the latter, which has produced, or tends to produce, injury to the public. People v. North R. S. R. Co., 121 N. Y., 582. When such transgression affects the welfare of the people, they mavby action summon the offending corporation to answer for the abuse of its franchise, and ask to have its charter forfeited, and itself dissolved. People t>. North R. 8. R. Co., 131 N. Y., 582, 23 GENERAL CORPORATION LAW. Sufficient order to show cause, under section 2423 of Code, in proceedings fow voluntary dissolution of corporation. Matter of Christian J. Co., 40 N. Y. St. Rep., 621. If such order is defective for not complying with section 2424 of Code, it do oot render appointment of receiver nullity. Id. It must be taken advantage of by motion. Id. It can be amended nunc pro tune. Id. Court may pi-event any subsequent interference with its property under writ of replevin or attachment. Id. After receiver files his bond, his title relates back to date of appointment. Id. Omission in petition for voluntary dissolution, which does not show lack of good faith nor fraudulent purpose, may be obviated by evidence. Matter of Santa E. 8. M. Co., 21 N. Y. St. Rep., 89. Order to show cause, in voluntary proceedings for dissolution of corporation, held, in this case, to be substantial compliance with section 2423 of Code. Matter of Christian J. Co., 39 N. Y. St. Rep., 379. People can not maintain action, under sections 1781, 1782 of Code, to redress strictly private wrong. People v. Ballard, 56 Hun, 125. Causes of action for sequestration of property of corporation, and to charge stockholders with individual liability, are properly united. Woodard v. Holland M. Co., 39 N. Y. St. Rep., 411. Sufficiency of allegation of complaint as to non-payment of capital stock. Id. One creditor may bring such action. Id. In such action it is not necessary to state in complaint facts upon which judgment against corporation was obtained. Id. Order of dissolution, under section 2429 of Code, should be granted, whero no benefit can result by continuing its existence. Matter of I. & G. Exchange, 16 Daly, 413. When receiver may be appointed to enforce judgment against corporation. King 71. Barnes, 51 Hun, 550. Court may, under certain circumstances, authorize receiver to advance money to corporation, taking security therefor, to enable it to continue its business. Kalb- fleisch v. Kalbfleisch, 37 N. Y. St. Rep., 183. Court may authorize receiver to issue certificates and borrow money thereon, to pay necessary running expenses and for necessary rolling stock. Central T. Co. v. Tappen, 25 N. Y. St. Rep., 635. Facts warranting exercise of court's discretion. Id. Such certificates are paramount liens. Id. Amount paid, under order subsequently reversed, can be recovered, or deducted, by receiver from subsequent dividend due claimant in excess of percentage pay- able to general creditors. People v. Remington & Sons ; Whitfiefd v. Russell, 60 Hun, 42. Receiver of corporation can not enforce agreement by president with creditor to mutually postpone enforcement of claims against it for indefinite period. Snow v. R. C. F. Co., 58 Hun, 134. All directors, shareholders and creditors in corporation, have right to transfer to themselves patent rights held by corporation and substitute their notes therefor. Skinner v. Smith, 56 Hun, 437. The- business of ordinary trading or manufacturing corporation may be wound up whenever majority of ita stockholders deem it expedient. Id. Receiver of corporation will not be compelled to account, where it appears that no property of corporation has come into his hands. Lyons v. A. H. Q. M. At M. Co., 38 N. Y. St. Rep., 892. Application by receiver of dissolved corporation for warrant of arrest must b made on notice to Attorney-General. Matter of Vanamee, 29 N. Y. St. Rep., 198. What proof must be made for such purpose. Id. Receiver of insolvent corporation, legally appointed, may institute proceeding* lo examine officer as to concealed assets. Matter of Stonebridge, 37 N. Y. St. Rep., 617. Statement of what facts in affidavit sufficient to sustain warrant. Id. Denial or explanation in no reason for its refusal. Id. Warrant against one having property of corporation must be applied for on notice to Attorney-General. Matter of Stonebridge (Sup. Ct. 1890), 32, 1070 ; 57 Hnn, 24 GBNERAL CORPORATION LAW. Such party is not bound to account until first publication of notice of appoint- ment of receiver. Id. What notice insufficient in such case. Id. Injunction against creditors of dissolved corporation will not be so modified, after appointment of receiver, as to permit entry of judgment in prior action and isaua of execution, before substitution of receiver as party defendant. Matter of Vertical T. B. Co., 38 N. Y. St. Rep., 528. Order for stay of all proceedings, on appeal from order annuling charter, will be denied, where order has been granted directing receiver to make no sale or dis- tribution of property until further order of court. People v. N. R. 8. R. Co., 25 N. Y. St. Rep., 569. Stock can not be transferred so as to pass a legal title after the dissolution of the corporation. James 7). Woodruff, 2 Denio, 574. In such case, the interests of the several stockholders become equitable rights to a proportionate share of the assets after payment of the debts. Id. A stockholder who is indebted to the company at the time of its dissolution, is only entitled to his share of the effects after deducting the amount which he may owe. James v. Woodruff, 2 Denio, 574. An assignee of a stockholder in a dissolved corporation takes the interest of the assignor, subject to all claims which the corporation has against him. James v. Woodruff, 2 Denio, 574. Where the debtor of a dissolved corporation becomes a purchaser of its stock, his debt will be deducted from his share of the assets. James v. Woodruff, 2 Denio, 574. His assignee or vendee takes it subject to a like deduction. Id. The appointment of a receiver after the commencement of an action to recover the unpaid balance of the subscription to the capital stock does not cause the suit to abate, but it may be continued by the receiver in the name of the original party. Phoenix W. Co. v. Badger, 6 Hun, 293 ; Albany, etc., Co. . Van Vran- ken, 42 How., 281 ; Tracy v. First Nat. Bk., 37 N. Y., 523. When discharge divests receiver of cause of action, such will lie in directors. Michel v. Betz, 108 App. Div. 342. 31. Forfeiture for non-user. If any corporation, except a rail- road, turnpike, plank-road or bridge corporation, shall not organize and commence the transaction of its business or undertake the dis- charge of its corporate duties within two years from the date of its incorporation, its corporate powers shall cease. Former section 21. See section 7, title 3, chap. 18, part 1, R. 8., and section 8, chap. 611 of 1875, now repealed. Action to dissolve corporation may be maintained, when it has suspended its or- dinary and lawful business for at least one year. People t>. Seneca, L. Q. and W. Co., 52 Hun, 174. Government, creating corporation, can alone, as general rule, enforce cause of forfeiture. Id. Proceedings to dissolve by directors is no bar to action by people to dissolve be- cause of forfeiture of. charter. Id. Notice of voluntary application to dissolve corporation must be served upon Attorney-General, otherwise order is void. Id. Action for forfeiture of charter on ground of suspension of business can not be maintained unless continued for a year. People t. A. A. R. R. Co., 126 N. T., 513. Omission to run trains for five days will not suffice. Id. Failure to observe chap. 529 of 1887, is not legal cause for forfeiture. Id. Neither six days dijcontinuance of business, nor exactions from its employee* of more than ten hours labor a day, is ground for action to dissolve corporation. People v. A. A. R. C., 57 Hun, 378. Code authorizes action to dissolve corporation when it has violated any provision of law, whereby it has forfeited its charter or become liable to be dissolved by abuse of its power. People v. North R. S. R. Co., 121 N. Y., 582. What constitutes actual corporate conduct. Id. Leave to renew action to forfeit charter will not be granted, where corporation*, relying upon discontinuance of former proceedings, has increased its capital and ma le contracts to complete its works. Matter of People v. E. G. L. Co.. 32 N. Y. St. Rep., 1128. 25 GKNBRAL CORPORATION LAW. It is the geaeral principle that a corporation, by omitting to perform a duty imposed by its charter or to comply with its provisions, does not f pso facto loue its corporate character or cease to be a corporation, but simply exposes itself to the dauger of being deprived of its corporate character and franchises by the judg> mut of the court in an action instituted for that purpose by the Attorney-General in behalf of the people. Brooklyn 8. T. Co. v. City of Brooklyn, 78 N. Y., 524. Still 'the Legislature has the power to provide that a corporation may lose its cor- porate existence without the intervention of the courts, by any omission of duty or violation of its charter or def/iult as to limitations imposed. Id. It is immaterial whether such provision is contained in, and the corporation is organized under, a general law or a special charter. Id. In such case it needs no action or judicial procedure to declare or complete a forfeiture of the charter and loss of corporate power. Matter of Brooklyn, etc., R. R. Co., 75 N. Y., 335; 72 id., 245S. The statute executes itself. Id. The loss of its corporate rights and powers may be asserted by any one whose rights may be affected by its assumption of corpoi at v powers. Id. Ca ise of forfeiture does not per se work forfeiture without judicial determina- tion, unless it was intended that the statute should execute itself. Matter of BI--H klyn E. R. Co., 32 N. Y. St. Rep., 10u.", ; ait'd 35 id., 45. A ft-rMture of the franchises of a corporation, unless there is s; me special pro- vision by statute, can lie enforced only by the sovereign power to which the corporation owes its life, in some proceeding instituted in behalf of such sovereignty. Denike u. N. Y. & R. L. & C. Co., 80 N. Y., f99. An action to dissolve surh corporation can not be maintained by a portion of the stockholdei-8. Id. In the absence of proof of fraud, mismanagement or wrong-doing on the part of the directors, it is discretionary with the court to appoint a receiver of the property of the corporation, though utterly insolvent; the stockholders have no absolute right to such appointment. Id. A corporation can not be said to have committed an act of insolvency, or to have neglected or refused to pay its obligations, because its demand notes remain out- standing until peyment has been demanded. Id. An unlawful lease ot the corporate property does not give a portion of the stock- holders a standing in a court of equity to ask for a dissolution of the corporation. Id. A corporation, which has been enjoined from the exercise of its corporate fran- chises and deprived of its property, and thus ceased to exist for all practical pur- poses, is not thereby actually dissolved. Kincaid v. Dwindle, 59 N. Y., f>48. To effect a dissolution of a corporation there must be a judgment of a court of competent jurisdiction declaring it dissolved. Id. Hollingshead v. Woodward, 35 Hun, 410. Until such judgment, creditors may proceed by suit against the corporation, unless restrained by injunction. Id.; People v. President, etc., 9 "Wend.. 351 ; Matter of Ref. Pres. Ch., 7 How., 47t> ; Mickles V. Rochester City Bk., 11 Paige, 118. A corporation can not be held to be actually dissolved till so adjudged and deter- mm-.l. either by judicial sentence or sovereign power. Kincaid th,Dwinelle, ante. In Slee v. Bloom, 19 Johns., 456, the corporation was held to be mssolvfld by the non-election of trustees and non-user of the franchises for a length of time, and a sale by the sheriff of all 'its real and personal property on execution. The acts done and suffered to be done, were regarded as equivalent to a direct surrender of the charter. Until judgment dissolving the corporation and ending its existence, a contract can be enforce against the company as well after as before the appointment of a receiver. Pringle v. Woolworth, 90 N. Y., 502. A corporation may appeal from a judgment declaring it to be dissolved, and from the orders based on the judgment or growing out of the proceedings taken to enforce it. Kelsey v. Pfuudler P., etc., Co., 15 Abb. N. C., 427. The dissolution of a corporation must be judicially ascertained and declared. Plans t>. HOIIHIIIIIM. 17 N. Y. St. Ro,, . f,71. 82. Extension of corporate existence. Any domestic cor- poration at any time before the expiration thereof, may extend the . oi ita existence beyond the time specified in its original certifi- of incorporation, or by law, or in any certificate of extension of corporate existence, by the consent of the stockholders owning two- 26 GENERAL CORPORATION thirds in amount of its capital stock, or if not a stock corporation, by the consent of two-thirds of its members, which consent shall be given either in writing or by vote at a special meeting of the stock- holders-called for that purpose, upon the same notice as that required for the annual meetings of the corporation ; and a certificate under the seal of the corporation that such consent was given by the stockholders in writing, or that it was given by vote at a meeting as aforesaid, shall be subscribed and acknowledged by the president or a vice-president, and by the secretary or an assistant secretary of the corporation, and shall be filed in the office of the secretary of state, and shall by him be duly recorded and indexed in a book specially provided therefor, and a certified copy of such certificate, with a certificate of the secretary of state of such filing and record, or a duplicate original of such certificate, shall be filed and similarly recorded and indexed in the office of the clerk of the county wherein the corporation has its principal place of business, and shall be noted in the margin of the record of the original certificates of such cor poration, if any, in such offices, and thereafter the term of the existence of such corporation shall be extended as designated in such certificate. If the term of existence of any domestic corporation shall have expired and it shall be made satisfactorily to appear to the supreme court that such corporation was legally organised, pursu- ant to any law of this state, and that it shall have issued its bonds payable at a date beyond the date fixed in its charter or certificate of of incorporation for the expiration of its corporate existence, and such bonds shall be unmatured and unpaid, the supreme court may, upon the application of any person interested and upon such notice to such other parties as the court may require, by order, authorize the filing and recording of a certificate reviving the existence of such corpora- tion upon such conditions and with such limitations as such order shall specify, and extending such corporate existence for a term not exceeding the term for which it was originally incorporated. Upon filing and recording such certificate in the same manner as certificates of extension of corporate existence duly issued before the expiration of the existence of a domestic corporation is authorized by law to be filed and recorded, such corporate existence shall be revived and extended in pursuance of the terms of such order, but such revival and extension shall not affect any litigation commenced after such expiration and pending at the time of such revival. If a corporation formed under or subject to the banking law, such certificate shall not be filed or recorded unless it shall have indorsed thereon the written approval of the superintendent of banks ; or, if an insurance corporation, unless it shall have indorsed thereon the written approval of the superintendent of insurance ; and, if a turn- pike or bridge corporation, it shall not be filed unless it shall have indorsed thereon or annexed thereto a certified copy of a resolution of the board of supervisors of each county in which such turnpike or bridge is located, approving of and authorizing such extension. If all the stock of a corporation other than a corporation formed under or subject to the banking law, or an insurance corporation, or a turn- pike, plank-road or bridge corporation shall be lawfully owned by another stock corporation entitled by law to take a surrender and merger thereof, the corporate existence of such corporation whose stock is so owned may be extended at any time for the term of the corporate existence of the possessor corporation, bv filing in the of- 27 GKNRUAI. Coin-on \TIOX LAW. fice or office- in which the ori of it- i-upital stock. Every corporation extending its corporal exigence under this chapter or under any general law of the state shall there t to the provisions of this chapter and of such general law, not- ny special provisions in its charter, and shall thereafter be deemed to be incorporated under the general laws of the state relating to the incorporation of a corporation, for the purpose of carrying on the in which it is engaged, and sh ill he subject to the provisions of such law. The certificate of incorporation of any corporation whose duration is limited l>y 5 of 1901. In effect April 16, 1901. Amended by ch. 256 of 1905. See section 2, chap. 29 of 1857, section 2 of chap. 13 of 1867, section 1, chap. 9Vt of 1867, and section 29, chap. 611 of 1875, now repealed. Bee People ex rel. Clauson v. Newburgh, etc., R. R. Co., 86 N. T.. 1. 33. Conflicting corporate laws. If in any corporate law thr is or shall be any provision in conflict with any provisions of this chap- ter or of the stock corporation law, the provisions so conflicting shall prevail, and the provision of this chapter or of the stock corporation law with which it conflicts shall not apply in such a case. If in any such law there is or shall be a provision relating to a matter embraced in this chapter or in the stock corporation law, but not in conflict with it, such provision in such other law shall be deemed to be in addition to the provision in this chapter or in the stock corporation law relating to tlir same subject-matter, and both provisions shall, in such case., In 1 applicable. New. See Adams v. Wallace, 82 App. Div., 117. 34. Laws repealed. Of the laws enumerated in the schedule hereto annexed, that portion specified in the last column is repealed, Such repeal shall not revive a law repealed by any law hereby repealed, but shall include all laws amendatory of the laws hereby repealed. Former section 93. People v. O'Brien, 111 N. T., 1. 35. Saving clause. The repeal of a law or any part of it speci- fied in the annexed schedule shall not affect or impair any act done, or right accruing, accrued or acquired, or liability, penalty, forfeiture or punishment incurred prior to May 1, 1891, under or by virtue of any law so repealed, but the same may be asserted, enforced, prose- cuted or inflicted, as fully and to the same extent as if such law had not been repealed. All actions and proceedings, civil or criminal, com- menced under or by virtue of the laws so repealed, and pending OD April SO, 1891, may be prosecuted and defended to final effect in the same manner as they mi^ht under the laws then existing, unless it flhnll bp otherwise pocially provided by law. '24. GENERAL CORPORATION LAW. 36. Construction. The provisions of this chapter, and of the stock corporation law, the railroad law, the transportation corporations law, and the business corporations law, so far as they are substantially the same as those of laws existing on April 30, 1891, shall be construed as a continuation of such laws' modified or amended according to the language employed in this chapter, or in the stock corporation law, the railroad law, the transportation corporations law, or the business cor- porations law, and not as new enactments. References in laws not repealed to provisions of laws incorporated into the general laws hereinbefore enumerated and repealed, shall be construed as applying to the provisions so incorporated. Nothing in this chapter or in the other general laws hereinbefore spe- cified shall be construed to amend or repeal any provision of the Crimi- nal or Penal Code or to impair any right or liability which any exist- ing corporation, its officers, directors, stockholders or creditors may have or be subject to or which any such corporation, other than a rail- road corporation, had or was subject to on April 30, 1891, by virtue of any special act of the legislature creating such corporation or creating or defining any such right or liability, unless such special act is re- pealed by this chapter. Former section 25 amended. 37. Law revived. Chapter three hundred of the laws of eighteen hundred and fifty-five, entitled " An act to incorporate the Baptist Historical Society of the city of New York," which was inadvertently repealed by the transportation corporations law, is revived and re- enacted, aivd shall be of the same force and effect as if it had not beer repealed. 38. When notice or lapse of time unnecessary. Whenever under the provisions of any of the corporate laws a corporation is authorized to take any action after notice to its members or after the lapse of a prescribed period of time, such action may be taken without notice and without the lapse of any period of time, if such action be authorized or approved, and such requirements be waived in writing by every member of such corporation, or by his attorney thereunto authorized. Added by ch. 672 of 1895. Took effect May 14, 1895. 39. As to acts of directors. Whenever, under the provisions of any of the corporate laws, a corporation is authorized to take any action by the agree- ment or action of its directors, managers or trustees, such agreement or action may be taken by such directors, regularly convened as a board, and acting by a majority of a quorum, except when otherwise expressely required by law or the by-laws of the corporation and any such agreement shall be executed in behalf of the corporation by such officers as shall be designated by the board of directors, managers or trustees. At any meeting at which every member of the board of directors shall be presen'., though held without notice, any business may be trans- acted which might have been transacted if the meeting had been duly called. Except when otherwise required by law or the by-laws of the corporation, special meetings of the members of the corporation may be called in the same manner as the annual meeting thereof. Amended b}' ch. 355 of 1901. In effect April 16, 1901. 40. Alteration and repeal of charter. The charter of every corporation shall be subject to alteration, suspension and repeal, in the discretion of the legis- lature. Added by ch. 672 of 1895. Took effect May 14, 1895' GENEEAI, COKPOEATION LAW. 41. Political contributions prohibited. No corporation or joint stock association doing business in this State, except a cor- poration or association organized or maintained for political pur- poses only, shall directly or indirectly pay or use or offer, con- sent or agree to pay or use any money or property for or in aid of any political party, committee or organization, or for, or in aid of, any corporation, joint-stock or other association organized or maintained for political purposes, or for, or in aid of, any can- didate for political office or for nomination for such office, or for any political purpose whatever, or for the reimbursement or in- demnification of any person for moneys or property so used. Any officer, director, stockholder, attorney or agent of any corporation or joint-stock association which violates any of the provisions of this section, who participates in, aids, abets or advises or consents to any such violation, and any person who solicits or knowingly re- ceives any money or property in violation of this section, shall be guilty of a misdemeanor and punishable by imprisonment in a penitentiary or county jail for not more than one year and a fine of not more than one thousand dollars. No person shall be ex- cused from attending and testifying, or producing any books, papers or other documents before any court or magistrate, upon any investigation, proceeding or trial, for a violation of any of the provisions of this section, upon the ground or for the reason that the testimony or evidence, documentary or otherwise, required of him may tend to convict him of a crime or to subject him to a penalty or forfeiture ; but no person shall be prosecuted or' sub- jected to any penalty or forfeiture for or on account of any trans- action, matter or thing concerning which he may so testify or pro- duce evidence, documentary or otherwise, and no testimony so given or produced shall be received against him upon any crimi- nal in vest! oration or proceeding. Added by chap. 239 of 1906. In effect April 16, 1906. 29a GBNRRAL CORPORATION LAW. SCHEDULE 07 LAWS REPEALED. REVISED STATUTES. Part I, chapter 18. All. LAWS of Chapter SECTIONS. 1811 67 All. 1815 47 All'. 1815 202 All. 1816 58 All. 1817 223 All. 1818 67 All. 1819 102 All. 1821 14 All. 1822 213 All. 1836 284 All. 1836 316 All. 1838 160..., All. 1838 161 All. 1838 262 All. 1839 218 All. 1842 165 All. 1846 155 All. 1846 215 17, 18. 1847 100 3, 4. 1847 210 All. 1847 : 222 All. 1847..} 270 All. 1847 272 All. 1847 287 All. 1847 398 All. 1847 404 All. 1847 405 All. 1848 37 All. 1848 40 AU. 1848 45 All. 1848 259 All. 1848 265 : All. 1848 360 All. 1849 250 All. 1849 362 All. 1850 71 All. 1850 140 All. 1851 . . . 14 All. 1851 19 All. 1851 98 All. 1851 107 All. 1851 487 AU. 1851 497 All. 1852 228 All. 1852... 372 AJL 30 GBNBRAL CORPORATION LAW. SCHBDULB OF LAWS RBPBALBD (Continued.) Law* of Chapter SECTIONS. 18B3 53 All. 1853 117 All. 124 All. 1853 135 All. 1863 245 All. 1863 333 All. 1853 471 1,2, 4. 1853 481 All. 1853 502 All. 1863 626 All. 1854 3 All. 1854 87 All. 1854 140 All. 1864 201 All. 1864 232 All. 1854 269 All. 1864 282 All. 1854 312 All. 1866 301 All. 1855 302 All. 1865 390 All. 1855 478 All. 1865 485 All. 1855 495 All. 1866 546 All. 1855 559 All. 1856 65 All. 1857 29 All. 1867 83 All. 1857 185 All. 1857 202 All. 1867 262 All. 1857 444 All. 1867 546 All. 1857 558 . .. All 1857 643 All. 1857 776 All 1868 10 All 1858 125 All 1859 ^ 209 All 1869 311 All 1869 455 All 1860 , 116 All 1860 269 All 1860 623 All 1861 , 149 All 1861 170 All 1861 215... All. GENERAL CORPORATION AW. SCHBDULE OF LAWS REPEALED (Continued.) Laws of Chapter SECTION!. 1861 238 All. 1862 205.. All. 1862 248 All. 1862 425 All 1862 438 All. 1862 449 All. 1862 472 All. 1863 63 All. 1863 134 All. 1863 346 All. 1864 85 All. 1864 337 All. 1864 517 All. 1864 582 All. 1865 234 All. 1866 246 All. 1866 307 All. 1866 691 All. 1865 780 All. 1866 73 All. 1866 259 All. 1866 322 All. 1866 371 All. 1866 697 All. 1866 -780 All. 1866 799 All. 1866 838 All. 1867 12 All. 1867 49 All. 1867 248 All. 1867 254 All. 1867 419 All. 1867 480 All. 1867 509... .0 :. All. 1867 775 All. 1867 906 All. 1867 937 All. 1867 960 All. 1867 974 All. 1868 253 All. 1868 290 All. 1868 573 All. 781 All. 1869 234 All. 1869 237 All. 1869 606 AIL 1869 706 AIL 1869... 844 All. 32 GBNBRAL CORPORATION LAW. SCHBDDLB OP LAWS RsFBALBD (Continued.) Laws of Chapter SECTIONS. 1869 917 .. All. 1870 124 All. 1870 - 135 All. 1870 322 All. 1870 443 All. 187G 568 All. 1870 773 All. 1871 95 All. 1871 481 All. 1871 535 All. 1871 560 All. 1871 657 All. 1871 669 All. 1871 697 All. . 1871 883 All. 1872 81 All. 1872 128 All. 1872 146 All. 1872 248 All. 1872 283 All. 1872 350 All. 1872 374 All 1872 426 All 1872 609 All. 1872 611 All. 1872 779 All 1872 780 All 1872 820 All except 90 1872 829 All 1872 843 All 1873 151 . . All 1873 352 All 1873 432 All 1873 440 All 1873 469 All 1873 616 All 1873 710 All 1873 737 All 1873 814 All 1874 76 All 1874 143 All 1874 14ft All 1874 240 All 1874 288 All 1874 430 All 1875 All 1875 All 1875 88... All. GBJCBRAL CORPORATION LAW. SCHBDULB OF LAWS RBPBALBD (Continued.) Laws of Chapter SECTION* 1875 ; 108 All. 1875 113 All 1875 119 All. 1875 120 All. 1875 159 All. 1875 -. 193 All. 1875 256.... All. 1875 319 All. 1875 365 All. 1875 445 All. 1875 > 510 All. 1875..,, 586 All. 1875 598 All. 1876 606 All. 1875 611 AH. 1876 77 All. 1876 135 All. 1876 198 All. 1876 280 All. 1876 358 All. 1876 373 All. 1876 415 AD. 1876 435 All. 1876 446 All. 1877 103 All. 1877 158 All. 1877 164 All. 1877 171 All. 1877 224 All. 1877 266 All. 1877 374 All. 1878 61 All. 1878 4 121 All. 1878 163 All. 1878 203 All. 1878 210 All. 1878 .".. 261 All. 1878 ,.... 264 All. 1878 316 All. 1878 334 All. 1878 394 All. 1879 214 All. 1879 253 All. 1879 290 All. 1879 293 All. 1879 350 All. 1879 377 All. 1879... 393 All. 34 GEHBRAL CORPORATION LAW. SCHEDULE OF LAWS REPEALED (Continued.) Laws of Chapter SECTIOm 1879 395 All. 1879 413 All. 1879 415 All. 1879 441 All. 1879 , 503 AIL 1879 505 All. 1879 512 All. 1879 541 All. 1880 5 All. 1880 85 All. 1880 90 All. 1880 94 Ali 1880 113 All. 1880 133 AIL 1880 155 All. 1880 182 All. 1880 187 AU, 1880 223 All. 1880 225 All. 1880 241 All. 1880 254 AIL 1880 263 All. 1880 267 All. 1880 349 All. 1880 415 All. 1880 417 AIL 1880 484 All. 1880 510 AIL 1880 575 All. 1880 582 AIL 1880 583 All. 1880 585 AIL 1881 22 All. 1881 58 All. 1881 77 All. 1881 117 AIL 1881 148 AIL 1881 213 All. 1881 232 All. 1881 295 All. 1881 296 All. 1881 311 All. 1881 313 AIL 1881 321 All. 1881 337 All. 1881 338 All. 1881 351 AIL 1881.., 399... All. 35 &BNBRAL CORPORA-TICK LAW. SCHBDDLB OF LAWS RBPBALBD (Continued.) LAW* of Chapter 8KCTIOH8. 1881 422 All 1881 464 All 1881 468 All 1881 470 All. 1881 472 All 1881 485 All. 1881 551 All. 1881 589 All. 1881 649 All 1881 650 All. 1881 674 All. 1881 685 All. 1882 73 All. 1882 82 All 1882 140 All. 1882 273 All. 1882 289 All. 1882 290 All. 1882 306 All. 1882 309 All 1882 349 All 1882 353 All 1882 393 All 1882 405 All 1883 46 All. 1883 71 AIL 1883 102 All 1883 216 AIL 1883 232 All. 1883 237 All. 1883 238 All. 1883 240 All. 1883 287 All. 1883 323 All. 1883 361.....' All. 1883 381 All. 1883 382 All. 1883 -.. 384 All. 1883 386 All. 1883 387 All. 1883 388 All. 1883 409 All. 1883 482 All. 1883 488 All. 1883 497 All. 1884 ... 140 All. 1884 193 All. 1884... 208 All. GrKNBRAL CORPORATION LAW. SCHEDULE OP LAWS REPEALED (Continued.) Law* of Chapter SECTIONS. 1884 223 All. 1884 252 All. 1884 267 All. 1884 367 All. 1884 386 All 1884... 397 All. 1884 421 All. 1884 422 All. 1884 439 All. 1884 441 All. 1884 444 All. 1885 , 84 All. 1885 127 All. 1885 141 All. 1885 153 All. 1885 171 All. 1885 305 All. 1885 369 All. 1885 422 All. *885 423 All. 1885 489 All. 1885 498 All. 1885 535 All. 1885 540 All. 1885 549 All. 1886 65 All. 1886 182 All. 1886 271 All. 1886 321... All. 1886 322 All. 1886 403 AIL 1886 415 All. 1886 609 AD. 1886 651 All. 1886 579 All. 1886 586 All. 1886 592 All. 1886 601 All. 1886 605 All. 1886 634 All. 1886 642 All. 1887 460 All. 1887 486 All. 1887 536 All. 1887 670 All. 1887 616 All. 1887 622 All. 1887... 724... All. 37 GKNBRAL CORPORATION LAW. SCBUDULB or LAWS RKPBALBD (Condiided). L*wof Chapter SBCTIONI. 1888 189 All 1888 306 All 1888 313 All 1888 359 All 1888 394 All 1888 447 All 1888 462 All. |888 513 All |888 614 All- 1888 649 All. 1888 560 All. 1889 57 All 1889 76 All. 1889 78 All. 1889 236 All. 1889 242 All. 1889 281 All. 1889 332 All. 1889 369 All. 1889 426 All. 1889 519 All. 1889 524 All J889 531 All 1889 532 All. 1889 564 All. 1890 23 AIL 1890 98 AIL 1890 119 . AIL 1890 193 AIL 1890 292 AIL 1890 416 AIL 1890 421 :. AIL 1890 483 AIL 1890 497 All. 1890 505 AIL 1890 508 All. 1890 543 All. 1891 67 All. 1891 287 All. 1892 2 AIL GENERAL CORPORATION LAW. No. 1. Section 7. Amended or supplemental certificate. &TATX OF NBW YORK, > County of . j We, the undersigned, directors of , under the authority given by section 7 of the general corporation law of 1892, do hereby certify that, in the original (or amended or supplemental) certificate of incor- poration, a matter, not authorized by law to be therein stated, has been inserted (or a matter required to be stated therein has been omitted), to wit : (here particularly state the defect, ; To conform to the requirements of the law, we do make and file this amended certificate, and for such purpose certify and allege as follows : (Here set forth all the allegations of the former certificate, supplying at omitting the aforesaid recital.) In witness whereof, we, the said directors, have executed this cer- tificate in duplicate, and hereto set our hands this day of :,18~. (Signatures of Directors.) STATB OF NBW YORK, \ County of . / * On this day of , 18 , before me personally came , to me known to be the persons described in, and who executed, the foregoing amended certificate, and they severally acknowledged that they executed the same for the intents and purposes therein mentioned. Justice of the peace. No. 2. Section 21. Proxy to Vote. KKOW ALI HBN BT THBBB PRESENTS, that I, Thomas Doe, do hereby constitute and appoint John Jones to be my lawful attorney, substitute nud proxy, for me and in my name, to vote on all the stock held by me 80 GENERAL CORPORATION LAW FORMS. in the Jones Manufacturing Company, at any election for directors, aa fully as I might or could do, were I personally present at such election. And I hereby revoke any proxy or proxies heretofore given by me to any person or persons whomsoever. In witness whereof, I have hereunto set my hand and seal this day of , 18. (Signed) THOMAS Do. [L. a.] ' In presence of RICHARD ROB. STATB OP NEW YORK, County of Thomas Doe, being duly sworn, says that the stock (or bonds) upon which the foregoing power or proxy to vote is given are in his possession and under his control ; that he has not ceased to retain title thereto, and that the foregoing power or proxy to vote has not been issued for any sum of money or anything of value. (Jurat.) . Forms of oath to be administered by inspectors to stockholders and proxies are found in section 22 of the General Corporation law. No. 3. 86*on 32. Form of Contmt. STATE or Nw YORK, ) County of , / We, the stockholders of the , a domestic corporation, owning two-thirds in amount of its capital stock, do, pursuant to the pro- visions of section 32 of the general Corporation Law of 1892, hereby certify that we severally consent to the extension of the term of the corporate existence of said company for a further period of years beyond the time fixed, by the certificate of incorporation, for the termination of its corporate existence. In witness whereof, we have hereto severally set our hands and annexed thereto the respective number of shares of stock owned by 00, in said company, tbie day of , 18 . (Names and stock) (For instance). BO Share*. 100 " 36 ** 40 QBNBRAL CORPORATION LAW FORMS. (Acknowledgment clause as in No. 1.) STATB OF NEW YORK, County of ss. , being duly sworn, says that he is the of the corpora- tion named in the foregoing consent and the custodian of its stock- book ; that the persons, whose names are subscribed to such consent, are the owners, upon the books of said corporation, of the number of shares of stock therein set opposite to their respective signatures to the above consent, and that such stock constitute at least two-thirds in amount of the capital stock of said corporation. (Jurat.) . The above form can be readily adapted in case of othei than stock oorporationB. 41 INDEX: A. SECTION Acquisition of additional real property 13 Acquisition of property in other states , 14 Acquisition of real property by foreign corporation 17, 18 Actions against foreign corporations l(i Actions by foreign corporations 15 Actions collusively brought, stay in 2S Actions pending, not affected 35 Additional real property, court may permit it to be held 13 Agents, right to appoint, etc., generally 11 Agricultural corporations, classified 2 Alteration of charter 40 Alteration of seal, right to 11 Amended certificate of incorporation, contents and effect of . ... 7 Amended certificate of incorporation as evidence !> Amended certificate of incorporation, filing of 5 ''Assurance " use of word, when prohibited 15 Authority of directors on dissolution 30 B. " Bank " use of word, when prohibited 15 " Banking " use of word, when prohibited 15 Banking corporation, a monied corporation 3 Banking powers, when prohibited 19 Baptist historical society, revived 37 " Benefit " use of word, when prohibited 15 Benevolent orders, classified as membership corporations 2 Bequest, right of corporation to take by 11 Board of supervisors, certain approvals by 32 Board of trade corporations, classified 2 Bookkeeper, not to be proxy 21 Books, to be produced at meetings 20 Business corporation, classified 2 " Business of a corporation," defined 3 Business to be commenced within two years 31 By-laws, directors to be controlled by 11 By-laws, corporations may make 11 By-laws, may fix amount of stock for quorum 11 By-laws, members may adopt 29 By-laws, right to make, generally 11 43 INDEX. SECTIO.V By-laws, to be published, etc 1 1 By-laws, what may be prescribed by 11 By-laws, when directors may make 29 G. Canvass of votes at special election . ; 26 Capital stock, divided into shares, makes stock corporation 3 Cemetery corporation, classified 2 Certificate authorizing foreign corporation to do business 15, 16 Certificate, no action to be maintained until certificate obtained 15 Certificate, when not granted, proof to be filed before granting 10 Certificate of incorporation, as evidence 9 Certificate of incorporation, by whom executed 4 Certificate of incorporation, defects, etc., in, how cured 7 "Certificate of incorporation," defined 3 Certificate of incorporation, fees, etc., to be paid before filing of 5 Certificate of incorporation, filing, etc., of 5 Certificate, how amended 7 Certificate, when amended, entry to be made 7 Certificate of incorporation, loss of, how supplied , 8 Certificate of incorporation, may regulate affairs of corporation, etc.... 10 Certificate of incorporation, may provide as to elections 2') Certificate of incorporation, supplemental 7 ( 'hallenges at election 22 Charter, alteration and repeal of 40 Charter, special provisions of, abrogated on renewal 32 City is municipal corporation 3 Classification of corporations 2 Clerk, not to be proxy 21 Collusion, actions by, stay in 28 Conflicting corporate laws 33 Construction clause 36 Co-operative corporation, classified. . . x 2 Corporate affairs, directors to manage 2!) Corporate existence, extension of 32 Corporate existence expired, renewal of 32 "Corporate law or laws," meaning of 3 ( orporate laws, conflict of 33 Corporate names C'orporate powers not to be exercised until taxes and fees paid ~* Corporate powers, forfeiture for non-user 31 ( '<>rporate powers, limit of fixed 10 Corporate powers, only, to be exercised 10 Corporations, classification of 2 Corporation, dissolution of, directors as trustees 30 Corporation, officers of, by-laws to regulate 11 Corporation, general powers of 11 44 INDEX. Corporation, extension of duration of 32 Corporation, forfeiture for non-user 3j Corporation, foreign, authority to do business 15 f ig Corporation, foreign, not to do business without certificate 1,5 Corporation, general powers of . . . : 1 1 Corporation heretofore organized, may adopt cumulative voting -in Corporation, real property, acquisition of additional 13 Corporations, classification of 2 Corporations, use of same name by, prohibited 6 County, is municipal corporation 3 County clerk, certificates of incorporation when to be filed with 5 Cumulative voting, may be allowed 20- D. Debts, to be paid on dissolution 30 Defects in certificate of corporation, how cured 7 Definitions 2 Destroyed certificate of incorporation, how supplied 8 Devise, right to take by 11 Definitions 2 Directors, acts of as a board 3!) Directors, actions by default of, stay in 28 Directors, actions by procurement of 28 Directors as trustees on dissolution 30 Directors, election of, etc 20 Directors, failure to elect, effect of 23 " Directors," includes what 3 Directors, majority of, power of 29 Directors, at least one to be resident of State 29 Directors, meeting of without notice, effect of 30 Directors, quorum of 20 Directors, residence of 29 Directors, special election of 24, 23 Directors, to be controlled by by-laws 11 Directors, to hold over 23 Directors to manage corporate affairs 29 Dissolution, directors as trustees on 30 Dissolution, powers of trustees on 30 Distribution on dissolution to be made 30 " Domestic corporation," defined 3 Domestic corporation, when may hold property without the State 14 Domestic corporation, extension of existence of 32 Duration of corporation, extension of 32 Duration of proxy 21 E. Effect of failure to elect directors 23 Election, challenges at 22 45 INDEX. SECTION Election of directors -0 Election of directors, effect of failure of 23 Election of directors, special 24, 25 Election, powers of supreme court respecting 27 Election, may order new 27 Elections, provisions of certificate of incorporation as to 20 Election, publication of by-laws governing 11 Election, qualification of voter at . . . . 20 Election, right to vote at, how determined 20 Election, special, notice of 24 Election, special, of directors 24, 25 Evidence, certificate of incorporation, use as 9 Extension of corporate existence 32 Extent of corporate power defined 10 Expiration of corporation, renewal after 32 F. Failure, to designate person upon whom process may be served, by for- eign corporation, effect of - 16 Failure to elect directors, effect of 23 Fees for incorporation, to be paid before certificate filed, etc 5 Filing certificate of incorporation 5 Fire, monument corporations, classified 2 Foreign corporation, acquisition of real property by 17, 13 Foreign corporation, certificate of authority J5 Foreign corporation, when action cannot be maintained by l."> " Foreign corporation," defined 3 Foreign corporation, acquisition of real property by 17, 18 Foreign corporation, may convey real property in the state 17, IS Foreign corporation, name of, prohibition as to 1-1 Foreign corporation, not to do business without certificate : . 15 Foreign corporation, pre-requisites to doing business in the state.... 15, 16 Foreign corporation, proof by, before doing business 16 Foreign corporation, purchases by at judicial sales 18 Foreign corporation to designate person upon whom process to be served . 16 Foreign corporation to designate principal place of business in state.. 10 Foreign corporation, failure to designate person, etc 16 Forfeiture for non-user 31 Form of proxy 21 G. General powers, what included in 11 (Jcncral reference to certain corporations, what it includes 2 ' : i 1 1 , right to take by 11 Grant of general powers, what it includes 11 Grant, right to take by 1 1 "Guaranty" and "guarantee," use of words, when prohibited 15 46 INDEX. H. SECTION Horticultural corporation, classified I. Incorporators, qualifications of 4 Incorporation, certificate of, filing, etc 5 Incorporation, how amended Incorporation, when amended, entry to be made 7 Incorporation, loss of certificate, etc., how supplied tf Incorporation, certificate of, as evidence 9 " Indemnity," use of word, when prohibited 15 Informalities in certificate of incorporation, how cured 7 Inspectors, to administer oaths 22 " Insurance," use of word, when prohibited 15 Insurance corporation, a monied corporation 3 " Investment," use of word, when prohibited 15 J. Judicial sales, purchases by foreign corporation at 13 L. Lapse of time, when not to effect corporation 38 Laws, conflicting .'!H Laws repealed and effect of 34, 85 Law revived .'57 Liability of directors on dissolution 30 Library corporation, classified 2 Limit of corporate powers fixed 10 Limit of property of non-stock corporation 12 Limit of proxy 21 Limit within which business to commence 31 " Loan," use of word, when prohibited IS Lost certificate of incorporation, how supplied 8 M. Majority of directors, powers of 29 Management, regulated by by-laws 11 Meeting of directors without notice, effect of 39 " Member of corporation," includes what 3 Member may be challenged at election '-2 Members, may vote by proxy 21 47 INDEX. SECTION Members, not to -ell vote - u Members, powers of, at special elections Members, when may apply for stay. . -. . . . 28 Members, qualifications of as voters 20 Membership corporation, classified - Mistake in time of paying bonds, provided for 32 M ixed corporation, classified 2 Mixed corporation, defined 3 Mode of calling special election of directors 24, 25 Mode of conducting special election of directors 24, 25 Monied corporation, classified 2 Monied corporation, defined 3 Monument corporations, classified 2 Municipal corporation, classified 2 Municipal corporations, exceptions relative to 11 Municipal corporations, what are, defined :> N. Name of old corporation, use of, when allowed 6 Names of corporations, use of same by, prohibited 6 Names of corporations, use of same by foreign, prohibited 15 New election, supreme court may order '. 27 Non-stock corporation, classified 2 Non-stock corporation, defined 3 Non-stock corporation, filing certificate of 5 Non-stock corporation, limit of property of 12 Non-stock corporation, value of property of, how computed 12 Non-user, forfeiture for 31 Notice of special elections 24 Notice, when unnecessary 38 o. Oath administered at elections, to be filed 22 Oath to proxy ,. 22 Oath, when challenged at election 22 Oath, who to administer at elections 22 "Office of corporation," defined ;j "Office of corporation," when located 3 < Hiiro of foreign corporation 10 Officer, not to be proxy . . x 21 < (flic-era, right to appoint, etc., generally j 1 P. Pending actions, not affected 35 1'erpetual succession, right of 11 INDEX. SECTION Personal liability of trustees on dissolution 30 Pledger of stock, may vote it 20 Powers of majority of directors '. 29 Powers of supreme court, respecting elections. 27 Powers of trustees on dissolution 30 Powers, what included in general grant ,. . . . H Principal place of business of foreign corporation to be designated 18 Process against foreign corporation, person designated to receive service. . \Q Prohibition as to certain names, etc 15 Prohibition of banking powers ] ') Proof by foreign corporation, for leave to do business 10 Property in other states, right to acquire 14- Property of non-stock corporation, limitation upon 12 Property, right to hold, etc 11 Proxies . ., 20, 21 Proxy, duration of 21 Proxy, form of 21 Proxy is revocable 21 Proxy invalid after eleven months 21 Proxy, oath to 22 Proxy, who to administer 22 Proxy, qualifications of 21 Proxy, when corporation may prescribe limits of 21 Publication of by-laws , 11 Purchase, right of corporation to take by 11 Q. Qualifications of incorporators ... . 4 Qualification of voters 20 Qualifications of voters at special elections 26 Quorum, at special elections 25 Quorum, by-laws to determine 11, 29 Quorum of directors 29 E. Railroad corporation classified 2 Real property, acquisition of additional 13 Real property, acquisition of by foreign corporation 17, 13 Recording certificate of incorporation 5 Regulation of corporate affairs, by by-laws 11 Religious corporation, classified 2 Repeal of charter 40 Repeal of laws and effect of 34, 35 Revival of corporate existence expired 32 Revival of certain laws 37 49 S. SECTION Revocation of authority of foreign corporation 16 Right to vote, how determined 20 Sale of votes or proxies forbidden . . .- 20 " Savings " use of word, when prohibited 15 Saving clause 35 School district, ia municipal corporation 3 Seal, right to have 11 Secretary of State, certificates of incorporation when to be filed with . . 5 Secretary of State to issue authority for foreign corporation to do busi- ness 15, 16 Service upon foreign corporation, person to be named by 16 Shares, corporation capital divided into, is a stock corporation , 3 Short title of this act 1 Soldiers' monument corporations classified 2 Special charter, conflict with present law 33 Special charter, provisions of, abrogated on renewals 32 Special election, business to be transacted at 2o Special election of directors 24, 25 Special election, canvas of votes at 2(j Special election, inspectors to file return etc 26 Special election, notice of 24 Special election, quorum at 25 Special election, qualification of voters at 26 Special elections, powers of members at 2-> Special election, qualification of voters at. 20 Special election, result how certified 26 Statement by voters at special elections 23 Statutory powers, only, to be exercised 10 Stay of proceedings in actions collusively brought 28 Stock, amount of at meetings, by-laws to fix 1 ] Stock corporation, classified i> St ock corporation, defined 3 Stockholders, consent by to extension of corporate existence 32 Stockholders, rights to vote 20 Stock, pledger of, may vote it 20 Stock, transfer of, by-laws to regulate 11 Succession, right of 11 Suit *, by trustees on dissolution 30 Summary hearing of election issues 27 Superintendent of Banks, certain approvals by 32 Superintendent of Insurance, certain approvals by 32 Supplemental certificates of incorporation, contents and effect of 7 Supplemental certificate of incorporation, filing of 5 Supreme court, may amend certificate of incorporation 7 cnie court, may permit additional property to be held 13 Supreme court, power of, respecting elections 27 50 INDEX. T. SECTION Taxes for incorporation to be paid before certificate filed, etc 6 Teller, not to be proxy 21 Term of directors holding office 23 Term for which corporate existence may be extended 32 Terms used herein, defined and applied 3 Territorial division, when is a municipal corporation 3 Time qualification of stock or bondholder to vote. 20 Time, lapse of, when of no effect 38 Title of act 1 Town, is municipal corporation 3 Transfer of stock, by-laws to regulate 11 Transportation corporation, classified 2 Transportation corporation, other than railroad, classified '2 " Trust " use of word, when prohibited 15 Trustees, directors as, on dissolution 30 " Trustees," included under directors . . < k 3 Trustees on dissolution, personal liability of 30 Trustees, on dissolution, powers of 30 V. Value of corporate property, how determined 12, 13 Village, is municipal corporation 3 Void claim, action on, stay in 28 Voters at special elections, qualifications of '16 Voters, qualifications of 20 Votes, number regulated 20 Votes or proxies, sale of forbidden 26 51 . 688. AN ACT to amend the stock corporation law. APPROVED by the Governor May 18, 1892. Passed, three-fifths being present. The People of the State of New York, represented in /Senate and Assembly, do enact as follows : The stock corporation law is amended to read as follows, to tak effect immediately : CHAPTER XXXVI OF THE GENERAL LAWS. THE STOCK CORPORATION LAW. AUTICLB 1. General powers ; reorganization ( 1-7). 2. Directors and officers ; their election, duties and liabilties ($} 20-39). 3. Stock ; stockholders, their rights and liabilities (J 40-55). ARTICLE I. GENERAL POWERS; REORGANIZATION. BBOTION 1. Short title, and application of chapter. 2. Power to borrow money and mortgage property. 3. Reorganization upon sale of corporate property and franchise*. 4. Contents of plan or agreement. 5. Sale of property ; possession of receiver and suits against him. 6. Assent of stockholders to plan of readj ustment. 7. Combinations prohibited. 8. Execution of mortgage. SECTION 1. Short title and application of chapter. This chapter shall be known as the stock corporation law, but article one shall not apply to monied corporations. 5"ormer section 1 amended. 2. Power to borrow money and mortgage property. In addition to^the powers conferred by the general corporation law, every stock corporation shall have the powr to borrow money and contract debts when necessary for the transaction of its business, or for the ex- ercise of its corporate rights, privileges or franchises, or for any other lawful purpose of its incorporation ; and it may issue and dispose of its obligations for any amount so borrowed, and may mortgage its property and franchises to secure the payment of such obligations, or of any debt contracted for said purposes. Every such mortgage, except purchase money mortgages and mortgages authorized by contracts made prior to May first, eighteen hundred and ninety-one* shall be consented to by the holders of not less than two- thirds of STOCK CORPORATION LAW. the capital stock of the corporation, which consent shall be given either in writing or by vote at a special meeting of the stockholders called for that purpose, upon the same notice as that required for the annual meetings of the corporation; and a certificate under the seal of the corporation that such consent was given by the stockholders in writing, or that it was given by vote at a meeting as aforesaid, shall be subscribed and acknowledged by the president or a vice-president and by the secretary or an assistant secretary, of the corporation, and shall be filed and recorded in the office of the clerk or register of the county wherein the corporation has its principal place of business. When authorized by like consent, the directors under such regula- tions as they may adopt, may confer on the holder of any debt or obligation whether secured or unsecured evidenced by bonds of the corporation the right to convert the principal thereof, after two and not more than twelve years from the date of such bonds, into stock of .the corporation; and if the capital stock shall not be sufficient to meet the conversion when made, the directors shall from time to time, authorize an increase of capital stock sufficient for that purpose by causing to be filed in the office of the secretary of state, and a duplicate thereof in the office of the clerk of the county where the prin- cipal place of business of the corporation shall be located, a certificate under the seal of the corporation, subscribed and acknowledged by the president and secretary of the corporation setting forth, 1. A copy of such mortgage; or resolution of directors authorizing the issue of such bonds. 2. That the holders of not less than two-thirds of the capital stock of the corporation duly consented to the execution of such mortgage or resolution of directors authorizing the issue of such bonds by such corporation; 3. A copy of the resolution of the directors of the corporation authorizing the increase of the capital stock of the corporation necessary for the purpose of such conversion; 4. The amount of capital theretofore authorized, the proportion thereof actually issued and the amount of the increased capital stock; If the corporation be a railroad corporation the certificate shall have en- dorsed thereon the approval of the board of railroad commissioners. When the certificate herein provided for has been filed, the capital stock of such cor- poration shall be increased to the amount specified in such certificate. Amended by ch. 354 of 1901. In effect April 16, 1901. Amended by ch. 745 of 1905. Former section 2 amended. 8e chap. 213 of 1822, section 2 ; chap. 517 of 1864, section 2 ; chap. 481 of 1871, action 13; chap. 611 of 1875, section 1; chap. 163 of 1878, and section 1, chap. 394 of 1888, all now repealed. For proceedings to sell, mortgage or lease real estate, see title 2, chap. 95 of 1890. The right to assent to mortgaging the property of a corporation is collective, tr be exercised in common with other shareholders and in the mode prescribed by the statute or by the articles of association. Campbell v. American Zylonite Co.. 122 N. Y., 456. . It is at least doubtful whether any but stockholders can complain that the assent was not given and filed in pursuance of this section. Paulding v. Chrome Steel Co.. 94 N. Y., 334 ; Greenpoint S. Co. v. Whitin, 69 id., 328. Tb assent, required by this section, is exacted for the benefit and protection of >rtor.kholder8 against improvident and corrupt acts of the officers of the corpora- tion. Paulding v. Chrome Steel Co., ante. The legislature, in such enactment, did not regard the mortgagingjof corporative property as improper per *. Id. The owners of corporate stock, by force of their ownership, may put a mortgage upon the corporate property when the statute permits. People v. North R. 8. R. Co., 121 N. Y.. 582. A corporation, without anmft statute allowing 1 it, can neither sell nor mortgage its franchises. Carpenter v Bla<-k Hawk Gold Mining Co., 65 N. Y., ; Hnsq. Can. Co. . Bonham, 9 Watts & S.. 27 ; Arthur v. Com and R. R. Bk.. 9 SmedesfcM.. 394 ; New Orleans, etc.. R. R. Co., 27 Miss., 517 ; Stewart V. Jones, 40 Mo., 140. '" A corporation, organized under this act, may. upon filing the requisite assent of two-thirda of its Blor.khoMers, mortgage its real estate to secure the payment of Itn debts, but not to raise money to carry on its operations. I<1 ; Rochester Sav. Bk. v. Averill, 26 Hun, 643. A mortgage is not invalid because it purports to mortgage the franchises of the company and ita personal property, as well as its real estate. Carpenter v. Black Hawk Gold Mining Co., ante. So far aa it purports to convey the franchises of the company, it ia simply Inoperative. Id. Power to mortgage ita personal WM conferred by chap. 481 of 1871, and ita franchises by chap. 163 of STOCK CORPORATION LAW. The statute prescribes no form for such mortgage, and there is no rule of Uw which requires a mortgage upon real estate to be in any particular form. Id. In this case, the instrument was in the form of a deed in trust, with power of sale in case of default in payment of the indebtedness secured. Id. There is nothing in the statute which limits the effect of the mortgage to the present real estate of the company, and nothing in the nature of a mortgage security which can thus limit its effect. Id. ; Seymour v. C. & N. F. R. R. Co., 25 Barb., 284 ; Fisk v. Patter, 2 Abb. Ap. Dec., 138. A separate mortgage need not be executed by the corportion to each creditor to secure his debt. Carpenter v. Black Hawk G. M. Co., ante. A single mortgage to one or more persons, though not creditors, in trust for the security of all the creditors, will accomplish the purpose of the statute. Id. ; De Ruyter v. St. Peter's Church, 3 N. Y., 238 ; King v. Merch. Ex. Co. v. 5 id., 547; Bucklin . Bucklin, 1 Abb. Ap. Dec., 242; Rochester Sav. Bk. v. Averell, 96 N. Y., 487; aff 'g 26 Hun, 643. A loan of money to pay the debts of a corporation, where the money is so ap- plied, is a debt contracted in the business for which the corporation was organized within the meaning of the atatute, and may be secured by mortgage. Rochester Sav. Bk. v. Averell, ante ; aff 'g 26 Hun, 643. The written assent of stockholders owning two-thirds of the capital stock to the mortgaging of the corporate property, is an indispensable condition of the creation of a valid mortgage. Id. ; aff 'g 26 Hun, 643 ; Vail v. Hamilton, 85 N. Y., 453. But a mortgage, executed without such assent, is validated by a subsequent assent, where there are no intervening rights. Id. Such assent make it, aa of tht time it is given, a valid mortgage. Id. ; Martin v. N. F. P. Mfg. Co., 122 N. Y., 165. The filing of the assent in the office of the clerk of the county, where the mort- gaged property is situated, is not an indispensable condition to the yalidity of the mortgage. Rochester Sav. Bk. v. Averell, ante ; aff 'g 26 Hun, 643. Without such filing, the mortgage is valid as against a subsequent mortgagee or purchaser, with notice. Id. Whether any person, who is not a stockholder, can interpose the objection of want of a sufficient assent, is questionable. Greenpoint 8. Co. v. Whitin, 69 N. Y., 328 ; aff'g 7 Hun, 44. A mortgage, though recorded prior to the filing of an assent, is valid from the time of such filing. Id. ; aff'g 7 Hun, 44. For the purposes of such assent, the amount actually issued and owned should be regarded as the amount of the capital stock. This power of assent is conferred upon those who represent two-thirds of the actual stock. Id. The statute does not prescribe any particular form of assent, nor what it shall specify or contain. It only requires an assent in writing. Id. The proviso was not enacted because the mortgaging of corporate property WM regarded as improper per se. Id. The question, whether any assent is necessary under the act of 1864, where a mortgage was given for the purchase- money of the mortgaged premises, or for a debt in the nature of purchase- money, was not passed upon in any case decided under sch act ; but the present act, in express terms, makes such assent m- necessary in case of purchase-money mortgages. A defect in an assent, in order to invalidate a mortgage given under it, in th absence of fraud, or of any objection on the part of the stockholders, must be of so substantial and radical a character that an intention to consent can not be inferred from the instrument. Greenpoint Sugar Co. v Whitin, ante. The assent in this case, though very deficient, was held to be sufficient. The power to alien and mortgage lands in the course of its business, inhered, by the common law, in a corporation capable of acquiring and holding them, as hi natural persons, as an incident of ownership. Rochester Sav. Bk. v. Averell, anh; aff'g 26 Hun, 643 ; Curtis v. Leavitt, 15 N. Y., 9 ; Barry v. Mer. Ex. Co., 1 Sandf Ch., 280. The legislature, in creating corporations, may, as it sees fit, grant or withhold such powers. Id. The act of 1848 created, in this respect, a disability not existing at common law, and the prohibition therein was absolute and unqualified. The act of 1864 did not in terms repeal the prohibition in the original aet, but was a new provision containing permission to mortgage for the special purposes, and under the proviso, therein mentioned. STOCK CORPORATION LAW. The present act embodies such permission and provision, with certain qualifica- tions. See Welch v. G. & T. N. Bank., 122 N. Y., 177; Lord t>. Yonkere F. G. Go., 98 id., 547. The object of the legislature in requiring such assent, was the protection of stockholders against improvident, collusive or unwise acts of the trustees in encumbering the corporate property. Id.; Greenpoint S. Co. v. Whitin, ante; and not the protection of creditors or subsequent encumbrancers. Id. The filing of the assent is unnecessary for the latter purpose. Id. The record of the mort- gage is constructive notice of the lien. Id. See Lord v. Yonkers F. G. Co., 99 N. Y., 547; Welch *. I. & F. N. Bk., 122 N. Y., 177. After judgment of foreclosure has been obtained upon a mortgage executed by a corporation, it is to be presumed in the absence of proof, that the required assent was procured and filed. Denike y. N. Y. & R. L., etc., Co., ante. Such judg- ment, unless impeached, is conclusive against the corporation and its stockholders as to the validity of the mortgage. Id. The burden of impeaching it is upon the stockholders. Id. They must establish that the mortgage was not given to secure a debt of the company, nor that the money obtained was used to pay debts. Id. With the prescribed assent of the stockholders, corporations are as competent as natural persons to secure the payment of their legitimate debts by mortgage upon their real or personal property. Lord v. Yonkers F. G. Co., ante. There is nothing in the statute which requires that the debt to be secured should have been contracted at any particular time. Id. If it is contracted simultane- ously with the giving of the security, and is a legitimate debt incurred in the business of the company, it comes within the letter of the authority conferred by the statute. Id. It is immaterial whether the money is applied by the borrower to the payment of some antecedent debt, or to some other purposes for which it is legitimately entitled to borrow money. Id. A mortgage given to secure future advances raises a different question. A consent to mortgage the real and personal estate, does not authorize a mort- gage of the corporate franchises. Id. Where a trust mortgage is given by a corporation to secure the payment of its negotiable bonds to be thereafter issued, the debts authorized to be secured need not be in existence at the time of the execution of the mortgage and bonds ; it is sufficient if the bonds are negotiated only for the purpose of securing or paying debts contracted before the negotiation. Id. Such corporation can give mortgages to secure debts contracted only in carry- ing on the operations named in its certificate of incorporation. Astor v. West- Chester G. L. Co., 33 Hun, 333. A corporation, formed under this act, has power to give a mortgage for future advances. Martin v. Niagara F. P. Mfg. Co., 44 Hun, 130; Jones v. G. & I. Co., 101 U. S., 622 ; Union Nat. Bk. v. Matthews, 8 Otto, 621 ; 8. c., 19 Alb. L. J., 132; Central G. M. Co. . Platt, 3 Daly, 268. The franchises, privileges, rights and liberties, which are not included in a con- sent to mortgage the real and personal estate of the corporation, are the corporate rights and franchises which become vested in the company by virtue of its organi- sation aa a corporation. Lord v. Yonkers F. G. Co., 101 N. Y., 614. Patent rights, licenses, easements or privileges, acquired by the company since its incorporation, either from individuals or other corporations, are in the nature of property, and included in a consent to mortgage the corporate property. Id.; Bridgeport v. N. Y. & N. H. R. R. Co., 36 Conn., 255 1 Chicago R. R. Co. . People, 73 111., 541 ; Morgan v. Louisiana, 3 Otto, 223. A corporation is empowered to mortgage its real estate to secure a debt con- tracted by it in the business for which it was incorporated. Martin v. N. F. P. Mfg. Co., 122 N. Y., 165 ; 33 N. Y. St. Rep., 318. Assent given before execution of mortgage by manufacturing company, where no rights of creditors intervene, is sufficient compliance with statute to make mortgage valid as against company and its stockholders. Id. A mortgage executed pursuant to a resolution of directors, who are not share* holders, is not, for this reason, void. Welch v. 1. & T. N. Bk., 122 N. T., 177;' 13 N. Y. St. Rep., 452. Where the written assent of all the shareholders is signed the day before the mortgage is executed, it is, as between the assignee of the mortgage and the receiver of the corporation, a sufficient compliance with the statute to file the STOCK CORPORATION LAW. ant simultaneously with the filing of the mortgage for record. Welch t>. 1 . A T. N. Bk., ante; Rochester Sav. Bk. v. Averell, ante. The security is not invalid for the reason that there were but two shareholders when the assent was signed. Welch v. I. & T. Nat. Bk., ante; nor by reason that there were but two persons legally qualified to act as trustees when its execution was directed. Id. ; Castle v. Lewis, 78 N. Y., 131 ; Altas N. Bk. t>. F. B. Q. Co., 8 Biss., 637 ; Russell v. McLellan, 14 Pick., 63. The assent of the holders of two-thirds of the stock actually issued IB sufficient to authorize the making of a mortgage by the corporation, so long aa there is no fixed, definite intention to increase the stock by future issues. Lyceum v. Ellis, 57 Super., 532 ; 30 N. Y. St. Rep., 242. The fact that some of the stock has not been paid for in full does not affect the validity of the assent. Id. Neither the issuing of a certificate for the shares nor payment therefor is indispensable to th ownership in shares in capital stock. Id. ; Wheeler t>. Millar, 90 N. Y., 389. A corporation may mortgage its property and dispose of its bonds to raise money to be thereafter expended in carrying on its business, though for indebtedness not already incurred. Graham v. Al tan ta Hill, etc., Co. N. Y. Daily Reg., Oct. 14, 1884. The fact that the consent does not specify the amount, that the mortgage IB valid only in the county where most, if not all of the property is situated, that it is given to trustees and not to the creditors directly, or that the bonds are sold below par if not below actual value, does not render the mortgage void. Id.; Jones v. Q. & I. Co., 101 U. 8., 622; Central G. M. Co. v. Platt, 3 Daly, 263; Greenpoint 8. Co. v. Whitin, 69 N. Y., 334. Where the corporation has transferred by assignment, absolute on its face, certi- ficates of stock so owned by it, as collateral security for debt, the shares so trans- ferred at least can not be deducted. Vail v. Hamilton, 83 N. Y., 453. Where the corporation is itself the owner of a portion of its stock, it can not give assent for the shares so owned by it, to make up the requisite two-thirds. Id. Nor can the assenting stockholders be deemed to represent a proportionate amount owned by the corporation. Id. Whether the shares held by the corporation may be deducted from the whol number in ascertaining if the assent of the requisite two-thirds has been obtained, was not determined in Vail v. Hamilton, ante. The assignee of stock, assigned by corporation aa collateral security for debt, U, U seems, a stockholder withia the meaning of this section and is entitled to sign the assent. Id. A receiver of a corporation may maintain an action to set aside mortgage executed by it without the requisite assent of stockholders. Id. Creditor has no title in law or equity to bonds issued by corporation in trust to pay its debts, nor right in proceeds of sale under mortgage given to secure such bonds, until delivery and acceptance. Hubbell v. S. I. Works, 36 N. Y. St. Rep., 902. Consent of stockholders to execution of mortgage by corporation, is sufficient, if signed, acknowledged and recorded with mortgage. Everson v. Eddy, 36 N. Y. St. Rep., 763. Such mortgage is valid where corporation is solvent. Id. Fact that resolution authorizing execution of mortgage by corporation was adopted by votes of persons owning indebtedness to be secured, does not affect validity of mortgage, where it is valid indebtedness incurred for corporation. Rit- tenhouse v. Winch, 32 N. Y. St. Rep., 506. 3. Reorganization upon sale of corporate property and franchises. When the property and franchises of any domestic stock corporation shall be sold by virtue of a mortgage or deed of trust, duly executed by it, or pursuant to the judg- "ment or decree of a court of competent jurisdiction, or by virtue of any execution issued thereon, and the purchaser, his assignee or grantee shall have acquired title to the same in the manner prescribed by law, he may associate with him any number of persons, not less than the number required by law for an incorporation 5 STOCK CORPORATION LAW. for similar purposes at least two-thirds of whom shall be citizens of the Ui:iteil States and one shall be a resident of this state, and they rnav income a corporation and take and possess the property and franciii-es thus sold, and which were at the time of the sale possessed by the corporation whose property shall have been so sold, upon making nnu acknowledging and filing in the offices where certificates of incorporation are required by law to be filed; a certificate in which thev shall describe by name and reference to the law under which it was organized, the corporation whose property and franchises they have acquired, and the c^urt by whose authority the sale had been made, with the date of the judgment or decree authorizing or directing the same, and a brief description of the property sold, and also the following particulars: 1. The name of the new corporation intended to be formed by the filing of such certificate ; and the place where its principal office is to be located. 2. The maximum amount of its capital stock and the number of shares into which it is to be divided, specifying the classes thereof, whether common or preferred, and the amount of, and rights pertain- ing to, each class. 3. The number of directors, not less nor more than the number required by law for the old corporation, who shall manage the affairs of the new corporation, and the names and post-office address of the directors for the first year. They may insert in such certificate any provisions relating to the new corpora tion, or its management, contained in any plan or agreement which may have been entered into as provide 1 in section four of this chapter. Such corporation, shall be vested with, and be entitled to exercise and enjoy, all the rights, privi- leges and franchises, which at the time of such sale belong to, or were vested in the corporation, last owning the property sold, or its receiver, and shall be sub- ject to all the provisions, duties and liabilities imposed by law on that corpo- ration. Any proceedings heretofore taken in substantial compliance with this ection as hereby amended and any and all incorporations based thereon are hereby ratified and confirmed. Amended by ch. 354 of 1901. In effect April 16, 1901. Amended by ch. 706 of 1904. Former section 3 without change. See chap. 469 of 1873, section 1; chap. 430 of 1874, section 1; chap. 446 of 1876, and section 1, chap 193 of 1890, now repealed. Amended by ch. 80 of 1902. In effect March 5, 1902. The amendment of 1902 made this section applicable to the assignee or grantee, of the purchaser, at the sale of corporate property and also added the ratification at the end of the section. Thia course of procedure was formerly applicable only to railroad companies, but has been, by these sections, extended to all stock corporations. Under this section, any number of persons may, at a foreclosure sale, purchase the corporate property for themselves, and organize a new company, which will ss all the powers, rights, privileges Mini franchises of the prior corporation, and be subject to the provisions, duties and liabilities imposed by law on each corporations. Vatable 71. N. Y., L. E & W R R. Co.. 9(5 N. Y., 49. In such case, the rights of all the stockholders of the prior corporation will be absolutely tarred and cut off by the foreclosure and sale. Id. The pmv.h.'iscrs ,-u the foivdosnre sale may. instead of buying absolutely for tbemattiVfg, Iniy thi- property in pursuance of a plan, as mentioned in the next section, for the ivnl ustraent of the respective interests therein of the mortpag-e- iors and stockholders of the company. Id. Even in this case, the fore- closure become^ absolute against the corporation, and absolutely bars and cuts off all its ri^ht-s and all the proprietary interests of the stockholders. Id. If the property is purchased under the plan provided in the next section, such plan mint 6 ' CORPORATION LAW. be embodied in the certificate to be tiled as required by this section. Id. In such case, each stockholder haa the right, under section 6 of this act, to assent to the plan of readjustment and reorganization at any time within six months after the organization of the new company, and become, by complying with the terms aud conditions of such plan., entitled to his pro rata benefits therein according to it* terms. Id. The only property interest which a stockholder of the old company has left is in the surplus, if any, after satisfying- the mortgage and other preferential claims. Id. A. corporation, organized under this section, is a new and entirely different one fi-om that whose property and franchises were purchased under the foreclosure proceedings. People ex rel. Schurz v Cook, 110 N. Y., 443. The right U. Us a corporation is not mortgaged or purchased, and is/Only obtained by lh<- purchasers by direct grant from the state, on filing the ertificate. Id. When the purchasers at the foreclosure pale undertake to recognize under this section, and for that purpose to file in the secretary's office a cerlilicatc, upon the filing of which they become a body politic and corporate, the corporation thus formed is a new and entirely different one from that whose property and franchises the purchasers may have bought under the foreclosure proceedings. Id. The corporation about to be formed by the filing of the certificate, has, by force of the statute, when formed, all the rights, franchises, powers, privileges and immunities which were possessed before such sale by the corporation whose property was sold. Id. The purchasers obtain the -right to be a corporation by direct grant from the state, and not in any degree by the sale and purchase of the franchises, etc.. of the old corporation. Id. See Post v. Simmons, 16 N. Y. St. Rep., 246. The act authorizing the mortgaging of the franchises of corporations is in DO sense a contract, on the part of the state, with the purchasers of bonds secured by sunh a mortgage, that the statutory provisions existing at the time of the execu- tion of the mortgage for the incorporation of the purchasers on foi-eclosure sale shall remain the same. People ex rel. Schurz v. Cook, ante. Whore the property and franchises of a corporation have been sold under mort- gage foreloaure, and a new corporation has been organized under this section, chap. 148 of 1886, as amended in 1887, applies to such new corporation. Id. ID such cose, the Secretary of State is prohibited from filing any certificate of its arti- cles of association until satisfied that the tax imposed by said act haa been paid j Id ; even though the mortgage foreclosed was executed prior to the passage of the corporation tax act. Id. In the absence of an existing corporation, capable of taking and exercising the franchises sold, the purchaser is authorized to create a new corporation for the purpose of the transfer, but whose corporate life comes from the grant and authority of the state. People -o. Brooklyn, etc., R. Co., 89 N. Y., 84. This pro- vision was not intended to prevent a sale or transfer to a corporation already exist- ing, and capable, under the law of its creation, of holding the property and exercis- ing the franchises which passed to the purchaser by the mortgage sale. Id. See also Pratt v. Munson, 84 N. Y., 582. The company formed under this section is a new corporation within the mean- ing of the Organization Tax act of 1886, as amended in 1887. People ex. rel. Martins v. Cook, 10 N. Y. St. Rep., 650. And it is subject to the payment of the tax impose 1 by said act. Id. In action to foreclose mortgage presumption ia that holders are bona fide owners and burden of showing want of consideration is upon defendant. Atlantic Trust Co. v. Crystal Water Co., 72 App. Div., 539. See also A. T. Co. v. N. Y. C. Suburban Water Co., 75 App. Div., 354. Defense of ultra vires must be pleaded. Hess v. W. & J. Sloane, 66 App. Div., 522. 4. Contents of plan or agreement At or previous to the sale the purchasers thereat, or the person for whom the purchase is to be made, may enter into a plan or agreement, for or in anticipa- tion of the readjustment of the respective interests therein of any creditors, mortgagees and stockholders, or any of them, of the cor- poration owning such property and franchises at the time of sale, and for the representation of such interests in the bonds or stock of the new corporation to be formed, and may therein regulate voting by the holders of the preferred and common stock at any meeting of the stockholders, and may provide for, and regulate voting by the 7 STOCK CORPORATION LAW. belders, and owners of any or all of the bonds of the corporation, foreclosed, or of the bonds issued or to be issued by the new corpora- tion ; and such right of voting by bondholders shall be exercised in such manner, for such period, and upon such conditions, as shall be therein described. Such plan or agreement must not be inconsistent with the laws of the state and shall be binding upon the corporation, until changed as therein provided, or as otherwise provided by law. The new corporation when duly organized, pursuant to such plan or agreement . North R. 8. R. Co., 19 N. Y. St. Rep., 868. Corporations can not consolidate their funds or form partnership. Id. Corporate acts, defined. Id. Transaction between defendant and central association was held trust and viola- tion of its charter, and failure in performance of its corporate duties, so material and important as to justify judgment of dissolution. People v. N. R. 8. R. Co., 121 N. Y., 682. When combination constitutes legal monopoly. Id. Monopoly may be created, in legal sense, in article, whether supply is restricted by nature or susceptible of indefinite production. Id. Any combination, the tendency of which is to prevent competition in its broad and general sense, and to control, and thus, at will, enhance prices to the detri- ment of the public, is a legal monopoly. People v. North R. 8. R. Co., 22 Abb. N. C., 164. Receiver of one member of trust can not maintain action for accounting or dis- solution. Gray v. Oxnard Bros. Co., 31 N. Y. St. Rep., 968. Rights of such receiver defined. Id. Receiver of one member of trust can not maintain action for accounting- of profits. Gray v. Oxnard Bros. Co., 59 Hun, 387. He has no right to fruits of illegal combination. Id. Receiver of corporation belonging to trust is entitled, as between him and oot poration, to assets. Pittsburgh C. Co. v. McMillin, 119 N. Y., 46. In this state, there can be no partnership of separate and independent corpora- tions, either directly or indirectly, through medium of trust. People v. N. R. 8. R. Co., 121 N. Y., 682. It is a violation of law for corporations to enter into a partnership. Id.; N. 1 * 8. C. Co. v. F. Bk., 7 Wend., 412 ; Clearwater t>. Meredith, 1 Wall., 29 ; Whe*- tenton Mills v. Upton, 10 Gray, 696. The consolidation of corporations engaged in the same general line of buaineM ie not against public policy. Cameron v. N. Y. & Mt. Vernon W. Co., 62 Hun, 269. The combination between two existing corporations for the prevention of competition is condemned. Id. Their consolidation into one corporation is permitted. Id. Two or more new corporations, organized under chap. 667 of 1890, for the piu - pose of carrying on any kind of business of the same or of a similar nature may consolidate, but they can not maintain their separate existence and combine to prevent competition between them, or between themselves and other corporation*. Cameron v. N. Y. & Mt. Vernon W. Co., 62 Hun, 269 ; N. Y. tt Sharon C. Co. 9. Fulton Bk., 7 Wend., 412; Wheetenton Mills . Upton, 10 Gray, 682 j Marine Bk. 0. Ogden, 29 111., 428. STOCK CORPORATION LAW. 8. Execution of mortgage. Whenever any mortgage affecting prop- erty or franchises within this state heretofore or hereafter executed by authority of the board of directors in behalf of any stock corporation, do- mestic or foreign, of any description, recites or represents in substance or effect that the execution of such mortgage has been duly consented to, or authorized by stockholders, such recital or representation in any such mortgage, after public record thereof within this state, shall be presump- tive evidence that the execution of such mortgage has been duly and suffic- iently consented to, and authorized by stockholders as required by any provision of law. After any such mortgage heretofore or hereafter shall have been publicly recorded for more than one year in one or more of the counties of this state containing the mortgaged premises or any part thereof, and the corporation shall have received value for bonds actually issued under and secured by such mortgage, and interest shall have been paid on any of such bonds according to the terms thereof, such recital or representation of such mortgage so recorded shall be conclusive evidence that the execution of such mortgage has been duly and sufficiently consented to, and authorized by stockholders as required by any provision of law, and its validity shall not be impaired by reason of any defect or insufficiency of consent or authority of stock- holders or in filing or recording such consent or authority, and such mortgage shall be valid and binding upon the corporation, and those claiming under it, as security for all valid bonds issued or to be issued thereunder, unless such mortgage shall be adjudged invalid in an action begun as hereinafter, in this section, provided. Notwithstanding the foregoing provisions of this section, the invalidity of any such mortgage heretofore recorded because of insufficiency of consent by stockholders may be adjudged in any action for such purpose begun before the first day of April, nineteen hundred and two, and the invalidity of any such mortgage hereafter recorded, because of insufficiency of consent by stockholders, may be adjudged in any action for such purpose begun, within one year after the earliest record of such mortgage in any county in this state, provided in either case that such action shall have been lOa STOCK CORPORATION LAW. so begun by or in behalf of the corporation by direction of the board of directors acting in their own discretion, or upon the written request of the holders of not less than one-third of the capital stock of the corporation ; and in any such action so begun by or in behalf of the cor- poration, the recitals or representations of the mortgage shall be pre- sumptive evidence only as first above provided. Whenever hereafter, in compliance with any law of this state, the officers of any corporation shall have made and filed and recorded a certificate that the execution of a mortgage hereafter made by the corporation has been duly con- sented to by stockholders, such certificate shall be conclusive evidence as to the truth thereof, in favor of any and all persons who in good faith shall receive or purchase, for value, any bond or obligation pur- porting to be secured by such mortgage, at any time when said cer- tificate shall remain of record and uncancelled. Nothing in this sec- tion contained shall affect any right or any remedy in respect of any such right of any creditor accrued before this enactment nor shall it dispense with the necessity of obtaining the consent of the board of railroad commissioners to any mortgage by a railroad corporation. Added by chap. 854 of 1901. In effect April 16, 1901, ARTICLE II. DIRBOTORB AMD OFFICBRfl J THEIR ELBCTION, DUTIBB AND LIABILITIES. BBOTIO* 90. Directors. 21. Change of number of directors. 22. When acts of directors void. 23. Liability of directors for making unauthorized dividends. 24. Liability of directors for contracting unauthorized debts and or**" issue of bonds. 25. Liability of directors for loans to stockholders. 26. Transfers of stock by stockholder* indebted to corporation. 27. Officers. 28. Inspectors and their oath. 29. Books to be kept. 80. Annual report. 31. Liability of officers for false certificates, report* or public notice*. 82. Alteration or extension of business, 88. 8ale of franchise and property. 84. Excessive indebtedness of officer or director. lOb STOCK CORPORATION LAW. 20. Directors. The directors of every stock corporation shall be chosen at the time and place fixed by the by-laws of the corpora- tion by a plurality of the votes at such election. Each director shall be a stockholder unless otherwise provided in the certificate, or in a by-law adopted by a stockholders' meeting. Vacancies in the board of directors shall be filled in the manner prescribed in the by-laws. Notice of the time and place of holding any election of directors shall be given -by publication thereof, at least once in each week for two successive weeks immediately preceding such election, in a newspaper published in the countv where such election is to be held, and in such other manner as may be prescribed in the by-laws. Policy holders of an insurance corporation shall be eligible to election as directors whether or not they be stockholders. At least one-fourth ia number of the directors of every stock corporation shall be elected annually Amended by ch. 354 of 1901. In effect April 16 1901 Am'd by ch. 238 of 1906. In effect April 16, 1906. Former section 20 amended. See sections 10, 26, chap. 611 of 1875, Hection 1, chap. 422 of 1881, section 1, ehap. 232 of 1883, and section 2, chap. 23 of 1890, now repealed. The powers vested in a corporation aggregate, which has a board of trustee*, reside, for all purposes of practical administration, in the board as a governing body. People's Bank v. St. Anthony's R. C. Chui-ch, 109 N. Y., 512. The cor- poration can only act through instrumentalities and by delegation. Id. When the methods and agencies by which it may act are designated in the statute creat- ing it, such designation operates as a limitation and excludes other modes ot action. Id. The collective authority of the trustees acting as a board is essential, m order to bind the corporation by the action of the trustees. Id. They have no separate or individual authority to bind the corporation, though the majority, or the whole number, acting singly and not collectively as a board, should assent to the partic- ular transaction. Id. ; Cammeyer v. The Churches, 2 Sandf. Ch., 186 ; Constant t?. Rector, etc., 4 Daly, 305. The business of a corporation must be carried on by a board of trustees. Sheri- dan E. L. Co. v. Chatham N. Bk., 40 N. Y. St. Rep., 311. They may appoint an executive committee of their own members, investing it with power to transact the business of the company during the interval between the meetings of the board of trustees. Id. ; Olcott v. Tioga R. R. Co., 27 N. Y., 546. Such commit- tee can delegate power to indorse checks received in pursuance of its contract. Id. Directors are authorized to manage and conduct the business of the company, to audit and pay its debts and make such contracts as are within the ordinary scope and business of the corporation. Kelsey v. Sargent, 40 Hun, 150. They are not authorized to vote away the funds of the stockholders upon claims known by them to be fictitious or unfounded. Id. Thij would be a breach of their trust. Id. Nor have they the power to mortgage or consolidate the com- pany with any other corporation, or to compel the stockholders to surrender up the stock owned by them, or to accept stock in another company. Id.; Blatchford v. Ross, 54 Barb., 42. Nor have they the power to bind the stockholders to pay such salaries as they by resolution see fit to vote themselves. Id.; Manx F. G. R. Co. v. Branegan, 40 Ind., 361 ; Holder v. L. F. & B. & M. R. R. Co., 71 111., 106. The board may delegate its power to agents, or to a quorum of less than a majority of the trustees. Hoyt v. Thompson's executors. 19 N. Y., 207. They may ratify the unauthorized acts of their agents. Id. ; F. & M. Bk. v. Empire S. D. Co., 5 Bosw., 284 ; see 6 Robt., 208. A formal resolution is not necessary for the appointment of an agent. Com. Bk. v. Kortright, 22 Wend., 348 ; N. P. Bk. t). G. A. W. Co., 53 Supr., 367; Negley v. C. R. Co., 1 N. Y. St. Rep., 298 ; Kelsey . Sargent, 40 Hun, 150 ; MacNaughton v. Osgood, 41 id., 109 ; Mnnson v. 8., etc., R. R. Co.. 4 Cent. Rep., 191. Authority may be inferred from the general manner in which an officer u 11 STOCK CORPORATION LAW. 1 itemselve8 " S upon rescinding, to pay the reasonable value rf^^jjgJi H , Trustees voting: themselves an increase of salary. McNab v. U ' which excludes compensation, applies to the president, chosen by the their own number, and also to a treasurer, when a director. entitled Recover on a Dowell v. Sheehan, 36 N. Y. St. with himself and for hia individual benefit. Matter of N. F. P. Mfg. Co., U stockholder may sue directors in his own name. Averill v. Barber, 26 uire for themselves certain patents belonging to corporation n veridge..N.Y.E.R. R. Co , 112 N. Y, 1 ; Leslie ^ Lorillard 110 id 536, Hoyt r>. Thompson's Em.. 19 id., 816 ; Bar,- t>. N.\ , L E . & W . ^ R- Co U M by one of them f this section, the directors under whose administration the same may have happened, excen^ tho*e who may have caused their dissent therefrom to be entered at larse upon, the minutes of such directors at the time, or were not present v.hen the same happened, shall jointly and severally be liable to such corpora- !3 STOCK CORPORATION LAW. tion and to the creditors thereof to the full amount of any loss sustained by such corporation or its creditors respectively by reason of such withdrawal, division or reduction. But this section shall not prevent a division and distribution of the assets of any such cor- poration remaining after the payment of all its debts and liabilities upon the dissolution of such corporation or the expiration of its charter ; nor shall it prevent a corporation from accepting shares of it3 capital stock in complete or partial settlement of a debt owing to the corporation, which by the board of directors shall be deemed to be bad or doubtful. Amended by cb, 864 of 1901. In effect April 16, 1901. See section 2, title 4, chap. 18, part 1, R. 8., section 13, chap. 40 of 1848, and section 19, chap. 611 of 1875, now repealed. It is made a misdemeanor, by section 594 of the Penal Code, for a director of a stock corporation to concur in any vote or act, by which it is intended to make a dividend, except from the surplus profits arising from the business of the corpora- tion, and in the cases and manner allowed by law. See chap. XI of the Penal Code for the criminal liability of directors in such corporations. The term " capital stock," as used in this section, means the property of the corporation, contributed by the stockholders or otherwise obtained, to the extent required by its charter. Williams v, Western U. T. Co., 93 N. Y , 162 ; Burrall t>. Bushwick R. R. Co., 75 id., 211 ; Barry v. Merchants' Ex. Co., 1 Sandf. Ch.,280. When its property exceeds this limit, the excess is surplus. Id. Such surplue ir.ay be divided among the stockholders, either in money or property. Id. Where a stock dividend does not exceed, in amount, the amount or value of suck surplus, it is not in conflict with any principles of public policy. Id. The object of this section is to prevent the dissipation of the fund designed for the benefit of creditors. Rorke v. Thomas, 56 N. Y., 559. Though a clear case must be established, still the substance, and not the mere form, of the provision must be the test of liability. Id. The object of the provisions of this section was to prevent a withdrawal of the property which would reduce the value of its assets below the sum limited for its capital in its articles of association. Williams v. West. U T. Co., 93 N. Y., 162. By this section, the legislature designed to provide substantially for the case* in Which individual liability should result from the acts prohibited. Excelsior P. Co. ?>. Embury, 4 Hun, 648 ; affd 63 N. Y., 422 ; Rochester v. Barnes. 26 Barb., 657. The trustees are not liable under this section for the costs in a judgment against the company perfected after they have ceased to be trustees. Roike v. Thomas, ante. There is no rule of law which imposes upon the officei-s of corporations the duty of requiring the production of the certificate of stock before the payment of dividends on the same. Brisbane v. D., L. & W. R. R. Co., 94 N. Y , 204 ; jiff 'g 2") Hun, 438. The corporation is justified in being governed, in paying dividends, by the books containing the lists of the stockholders until proof of notice is given showing that other parties than those named therein are the owners of the stork. Id. A person's title to dividends upon stock standing in his name upon the com- pany's books, is conclusive until impeached or impaired by the certificate itself with a transfer, or other evidence, showing that the stock belongs to some other party. The corporation is bound to pay it to him, or his personal representatives, unless it has some notice of a change of the'title, or of a transfer of the stock, pi- such knowledge or information as will put it upon inquiry as to the ownership thereof. Id. The rate of dividend to be paid, and the amount of surplus to be retained, by a corporation must rest in the fair and honest discretion of its trustees. McNab T>. McNab & H. Mfg. Co., 62 Hun, 18. When such discretion has been exercised, the courts do not undertake to control such action, even though they might differ in their views of the proper management to be adopted and followed. Id.; Williams w. W. U. T. Co., 93 N. Y., 162 ; Scott v. Eagle P. Co., 7 Paige, 198. A corporation is authorized, by law, to issue a scrip dividend, to represent its surplus earnings. Williams u W. U. T. Co., 93 N. Y., 162; Hatch v. Same, id., 196. See Strong v. Brooklyn Cross-Town R. R. Co., id., 426. See also Bank of Niagara v. Johnson, 8 Wend., 645 ; Northern R. R. Co. v. Miller, 10 Barb., 260; Williams v. W. U. T. Co , 9 Abb. N. C., 437. Dividends must be made out of surplus profits which exist in praenti. Williams t>. 14 STOCK CORPOKATION LAW. Western U. T. Co., 9 Abb. N. C., 419. When an investment or earnings baa beeu raade, a dividend equal in amount to such past earnings cm riot be declared limply on the ground that there have been in the past such earnings Id. A sale or assignment of the stock transfers, by operation of law, all benefits to I't) derived from the HHIIK:, and all profit*, income, dividends, or right to dividends l>y contract, which form a constituent, valuable and inseparable portion of the oration. Jermain v. Lake S. & M. S. Ry. Co., 91 N. Y., 488; Boardman v. Same, antet Manning v. Quicksilver M. Co., 24 Hun, 361. When a dividend has once been declared arid credited to the shareholder, a sale or assignment of the stock does not transfer his dividend, but it remains subject to his control. Jermain v. Lake S. & M. 8. Ry. Co., ante. A corporation may lawfully issue to its shareholders bonds, in lieu of cash divi- dends, to represent the earnings of the company which have been used in the con- struction and betterment of the corporate property. Wood v Lary, 47 Hun, 550; Williams v. Western U. T. Co., 93 N. Y., 162 ; N Y., L. E. & W. R. R. Co. . Nickals, 119 U. S., 296 The right of the preferred creditors to dividends does not depend upon their declaration by the board of directors. Wood v. Lary, ante. Such right is not lost by the fact that the board of directora did not declare a dividend each year, pro- vided the earnings of the corporation in each year, over and above its expenses, were sufficient to pay such dividends. Id. Holders of preferred guaranteed stock, though not entitled to -dividends when no profits are earned, are first entitled to be paid the amount of dividends specified and guaranteed, including all arrears, before the holders of common stock are entitled to any thing. Boardman v. Lake S. & M S. Ry. Co.. ante. Shares can not be lawfully transferred without the surrender of the certificate which has been issued to authenticate the right of the person named in it to them. Brisbane v. D., L. & W. R. R Co., 25 Hun, 438. Until such surrender, the origi- nal stockholder is to be regarded as the owner. Id. To obtain the dividends on the shares he is not bound to produce the certificate, but can do so upon the fact of his recorded title so long as no evidence appears from which his right can be impeached or questioned. Id. Smiths. Amer. C Co., 7 Lans., 317 ; McNeel v. Tenth N. Bk., 46 N. Y., 325 ; Manning v. Quicksilver M. Co., 24 Hun. 3fO. In uch case, a payment of dividends to the administrator of one in whose name the stock stands is authorized. Id. Stockholder can not sue for his aliquot share of dividends until division is made or dividend declared. Beveridge v. N. Y. E. R. R. Co.. 112 N. Y. 1. Declaration of dividend is discretionary. Id. Dividend on stock belongs to owner at time it is declared, in absence of contrary provision, or rules of stock exchange. Hopper v. Sage, 112 N. Y., 530. An action can not be maintained by the corporation for the performance of any act prohibited by this section, under any statute, as it prescribes the only penalty recoverable for such violation, and the only persons who may sue therefor. Excel- sior P. Co. v. Lacey, 63,2!. Y.. 422. Nor can an action at common law be main- tained by the corporation where the trustees acted in good faith, and no question of negligence is raised. Id. 15 STOCK CORPORATION LAW. An action under this section must be brought within three years from the time the cause of action accrued. Merchants' Bk. v. Bliss, 35 N. Y., 412. Where a stockholder receives from a corporation dividends declared and admit- ted by it to be due to him on shares of the corporate stock, an action is not main- tainable against him in the first instance at the suit of one claiming to be entitled to share in the dividends, but whose rights had been ignored by the corporation, to recover, as for moneys had and received, the proportion of the dividends so received, to which he would have been entitled, if his shares had participated. Peckhamv. Van Wagenen, 83 N. Y., 40; see Butterworth v. Gould, 41 id., 450; Patricks. Metcalf, 37 id., 332. The remedy of one thus wrongfully excluded from the rights of a stockholder is, it seems, against the company. Id. He can not follow the assets of the coni- Eany in the hands of parties to whom it has been paid, until he has at least estab- shed his rights as a creditor of the company, and has exhausted his legal remedies against it. Id. If he had been an admitted stockholder, and a dividend had been declared upon his shares with the others, and the amount of the divi- dend had been placed in the hands of a third party for distribution, a trust would be created in his favor, and he ould follow the fund in the hands of the party who had thus received it, or his transferee. Id. ; LeRoy v. Globe Ins. Co., 2 Edw. Ch., 657; Matter of Le Blanc, 75 N. Y., 598. McNab v. McNab & H. Mfg. Co., 62 Hun, 18; Hopper v. Sage, 112 N. Y., 530 ; Brundage v. Brundage, 60 id., 544; Hill v. Newichawanick Co., 8 Hun, 459; afFd 71 N. Y., 593; Boardman v. Railway Co., 84 id., 178; Beveridge v. N. Y. E. R. R. Co., 112 id., 1, 27; Jones v. Terre H. etc., R. R. Co., 57 id., 197; Wil- liams 7). W. U. T. Co., 93 N. Y., 162. lit an action under this section, all the creditors of the company must be joined. Anderson o. Speers, 21 Hun, 568; 59 How., 421; Homer v. Henning, 93 U. S., 228 ; Buchannan v. Bartow Iron Co., 3 Bradwell, 191 ; Merchants' Bk. v. Stephen- aon, 10 Gray, 232. In such action, an accounting is necessary to determine who are creditors of the company, and the ratable manner in which the .excess should be distributed among them. Anderson v. Speers, ante. See also, Hatch p. Dana, 101 U. 8., 205 ; Terry v. Little, id., 216 ; McLean v. Eastman, 21 Hun, 312. Estimated profits are not "net profits." Hutchinson v. Curtiss, 45 Misc. 484. 24 (Liability oi directors for unauthorized debts and over issue of bonds.) Repealed by ch. 864 of 1901. In effect April 16, 1901. Former section 24 amended. See section 3, title 4, chap. 18, part 1, R. 8., section 23, chap. 40 of 1848, and section 22, chap. 611 of 1875, now repealed. An individual creditor of the company can not, under this section, maintain an action in his own behalf for the recovery of his own debt against the officers assent- ing to the unlawful increase of the company's indebtedness. Anderson v. Speei-s, 21 Hun, 568 ; Hornor ?>. Henning, 93 U. 8., 228; Buchannan v. Barto Iron Co., 3 Bradw., 191 ; Mer. Banku Stevenson, 10 Gray, 232. The other creditors of the company should be made parties, either directly or theoretically. Id. An action in equity alone can be maintained. Id. The provision does not render the trustees, assenting to the unlawful increase of 16 STOCK CORPORATION LAW. tke company's indebtedness, liable for all the debts of the corporation, but only to the extent of the excess of the indebtedness over the amount of the capital slock of the company, and then not to the creditors individually, but in terms to the creditors collectively, and as a mass. Anderson v. Speers, ante. It substantially creates a fund to the extent only of the unlawful excess of indebtedness, in the dis- tribution of which all the creditors are ratably entitled to participate. Id. An action under this section can be brought only by all the creditors jointly, or by one creditor in behalf of himself and all the other creditors of the company. Id. In such action, each creditor can recover such a proportion of the excess of the debts over the amount of the capital stock only as his debt bears to the whole amount of the debts of the company. Id. See also McComb v. Kellogg, 16 N. T. St. Rep., 16. This section does not forbid, but rather permits the company, to create further debts when those already created equal in amount to the capital stock. Patterson t). Robinson, 36 Hun, 622. In order to secure payment to the creditor who became auoh after the limit of the capital is exceeded, it adds the personal and individual liability of the trustees assenting to such excess, to the liability of the company. Id. ' If the trustees create a further excess of indebtedness, after the excess of in- debtedness over the capital stock already exists, their personal liability seems to attach eo 'mstanti the debt is created. Id. The assenting trustee became bound to the creditor by the contract whereby the excessive debt is created, and can not be discharged therefrom without such creditor's consent; id., or by payment to him. Id. The extinguishment of the aggregate excess of indebtedness by paying other creditors, does not cancel the assenting trustees' personal liability to the creditor for the excess. Id. Same 75. Same, 37 Hun, 341. Where a trustee does not assent to the creation of an indebtedness exceeding the capital stock of the company, his subsequent failure to dissent, when informed of the fact, is not equivalent to the assent required by the act. Patterson v. Robin- son, 36 Hun, 622. What "assent" is required to make a trustee liable under thia section. Id. The assenting trustees are personally and individually liable for such excess to the creditors of the company to whom such excess is owing. Id. The liability of the assenting trustee, is a contract, and not a penal liability. Id. ; McComb v. Kellogg, ante. In an action under this section, all the assenting trustees must be joined as parties. The liability is joint and not several. McClave v. Thompson, 36 Hun, 365. In determining the amount of the liabilities of the company, to ascertain whether or not they exceed the amount of the capital stock, a judgment recovered against the company by one of the trustees for money advanced to it by him, though subse- quently assigned to a third person, can not be treated as one of such liabilities. Id. In an action under this section, it is enough to state the amount of the paid up capital, and to give the amounts of the claims which are outstanding. Robinson c. Attrill, 66 How., 121. Even though some of them are not due. Id. But the claim upon which the action is brought must be <'ue at its commencement. Id. If an apparent claim is not read, this fact may be set up by answer. Id. But it ia no objection that some of items of indebtedness were created in favor of the directors, or some of them. Id. Where stock has been issued to a stockholder as paid up to a certain amount, when such amount has not in fact been paid, a judgment creditor of the corpora- tion can maintain an action against him to recover the amount so unpaid on the stock. Christensen v. Eno, 21 W. Dig., 202. Such action is not barred until ten years after the time when it accrued. Id. It is no defense that the indebtedness of the plaintiff did not exist at the time of the delivery of the stock to defendant. Id. Creditor of corporation can not recover against gratuitous holder of its bond, without proof of some payment of corporate assets on such bonds. Christensen v. I. & S. L. B. Co., 52 Hun, 478. When stockholder not deemed to have withdrawn anything from company. Id. The party, seeking to fix a, personal liability upon a trustee under t; must allege that the excess of indebtedness was equal to or exceeded the amount of his claim. Chambers v. Lewis, 28 N. T.. 454. It is not sufficient to allege that such excess exceeds the amount of the capital. Id. Complaint, which alleges incorporation of company, execution of excess of indebtedness over capital at time, states cause of action. Lovelace v. Doran, 39 N. Y. St. Rep. 679. When plaintiff failed to prove that the indebtedness m excess of the pai up capital was not secured by mortgage, complaint properly dismissed. Irving Nat. Bank v. Moynihan, 84 App. Div., 307. 17 STOCK CORPORATION LAW. 25. Liability of directors for loans to stockholders. No loan of moneys shall be made by any stock corporation, except a monied corporation, or by any officer thereof out of its funds to any stock- holder therein, nor shall any such corporation or officer discount any note or other evidence of debt, or receive the same in payment of any installment or any part thereof due or to become due on any stock in such corporation, or receive or discount any note, or other evidence of debt, to enable any stockholder to withdraw any part of the money paid in by him on his stock. In case of the violation of any pro- vision of this section, the officers or directors making such loan, or assenting thereto, or receiving or discounting such notes or other evi- dences of debt, shall, jointly arid severally, be personally liable to the extent of such loan and interest, for all the debts of the corporation contracted before the repayment of the sum loaned, and to the full amount of the notes or other evidences of debt so received or dis- counted, with interest from the time such liability accrued. Former section 25 amended. See section 2, title 4, chap. 18, part 1, R. 8., and section 20, chap. 611 of 1875, now repealed. The principal object of this section is to prevent a reduction of the capital, under cover of loans to stockholders. A. C. Nellis Co. v. Nellis, 62 Hun, 63 ; 41 N. Y. St. Rep., 599. It is intended for the protection of creditors. Id. This section forbids a loan to a stockholder. Id. The fact that there is by this section a special liability of the officers to the creditors does not take away the prohibition. Id. A board of trustees can not ratify an act which they could not lawfully do in the first instance. Id. Peterson v. Mayor, etc., 17 N. Y., 449; Brady v. Same, 20 id., 312. The provisions of this section apply only to cases where there is a loan in law, or in fact, in violation thereof. Billings v. Trask, 30 Hun, 314. To establish a right of action under the statute on behalf of creditors, it is necessary to show that the transaction out of which it is claimed to have arisen, is both in law and in fact a loan of money. Id. It must be an actual loan of money in such form as to create an indebtedness to be at some time repaid, so that a liability for repayment by the borrower is created. Id. The liability created by this section exists in favor of a certain class of creditors only, and can only be enforced by them, and not, it seems, by a receiver. Id. The officers making or assenting to any loan of its money to any stockholders, are personally liable for all the debts of the company contracted before such loan shall be paid. Boynton v. Hatch, 47 N. Y., 225. 26. Transfers of stock by stockholder indebted to corpo- ration. If a stockholder shall be indebted to the corporation, the directors may refuse to consent to a transfer of his stock until such indebtedness is paid, provided a copy of this section is written or printed upon the certificate of stock. Former section 26 without change. See section 12, chap. 611 of 1876, now repealed. Rights of vendee of stock, Johnson v. Underbill, 52 N. Y., 208 ; McNeal . 10th Nat Bk., 46 id., 325 ; Com. Bk. v. Kortright, 22 Wend., 384. 27. Officers. The directors of a stock corporation may appoint 18 STOCK CORPORATION LAW. from their number a president, and may appoint a secretary, treas- urer, and other officers, agents and employes, who shall respectively have such powers and perform such duties in the management of the property and affairs of the corporation, subject to the control of the directors, as may be prescribed by them or in the by-laws. The direc- tors may require any such officer, agent or employe to give security for the faithful performance of his duties, and may remove him at pleasure. The policy holders of an insurance corporation shall be eligible to elec- tion or appointment as its officers. Former section 27 amended. See section 5, chap. 40 of 1848, now repealed. See also section 22 of this act. The board of trustees may appoint an executive committee of its members, and invest it with power to transact the business of the company during 1 the interval between the meetings of its board of trustees. Sheridan E. L. Co. ?>. Chatham Nat. Bk., 127 N. Y., 517. Such committee may delegate to one of its number power to do merely ministerial acts, such as the indorsing of checks payable to the corporation autl receiving the money thereon. Id. See People ex rel. New- man v. Sailors' 8. H., 54 Bai-b., 532. Manufacturing corporation can appoint committee to transact ordinary business. Sheridan E. L. Co. v. C. Nat. Bk., 52 Hun, 575, Such committee can delegate power to indorse company's paper. Id. When no formal resolution is necessary. Id. Company's knowingly appropriating part of proceeds to its use amounts to rati- fication of agent's act. Id. As to the authority of the president, see Beers v. Phoenix Glass Co., 14 Barb., 538 ; L. & F. Ins. Co. v.M. F. Ins.Co., 7 Wend., 31 ; Kraft v. Freeman P. Co., 87 N, Y., 628. Officers, assuming the responsibility and charged with the duties of the manage- ment of the corporative business, are, it seems, chargeable with the knowledge as to matters which are open to observation and legitimately subject to their inspec- tion and control. Huntington v. Attrell, 118 N. Y., 365. The addition, to their individual names, of that of their titles of office, or a state- ment of their respective characters, does not shield the office7'S from liability upon a contract wherein they have asssumed to contract individually, or have, by the terms of their agreement, come under a personal obligation to their several GMnisees. Taft v. Brewster, 9 Johns., 339 ; Stone v. Wood, 7 Cow., 453 ; Quyon t>. wis, 7 Wend., 26. But they do not become individually liable, where it appears on the face of the instrument that they contracted with reference to corporate business, and they had authority to make such contract on behalf of the corpora- tion. Whitford v. Laidler, 94 N. Y., 145 ; Lincoln i>. Crandell, 21 Wend., 101 ; Chouteau v. Suydarn, 21 N. Y., 179; Shaefer v. Henkel, 75 id., 378; Randall v. Van Vechters, 19 Johns., 60 ; Brockway v. Allen, 17 Wend., 40. Trustee may purchase and enforce claim against company. Inglehart v. T. I. H. Co., 32 Hun, 377 ; Crooked L. N. Co. v. K N. Co., 37 id., 9 ; Butler -. Duprat, 51 Supr '. 77. President, when empowered by by-laws, can make necessary negotiable paper, without authority of board of directors. Chem. N*t. Bk. v. Colwell, 18 Daly, 28. Corporation can not set up its unpublished and neglected by-laws to abut au- thority of its president, arising from having been permitted to hold himself out aa general manager. Marine Bank v. Butler Co., 23 N. Y. St. Rep., 318. It is estopped from denying truth of his representations. Id. No revocation or change in personnel can affect third party, without actual notice to him. Id. Evidence and inferences held sufficient to warrant finding that contract of presi- dent was approved of, or acquiesced in, by directors. Merrill v. C. C. Co., 23 N. Y. St. Rep., 114 ; aff'g 53 Super., 540. Authority of president to make contract is admitted by admission in answer of corporation, of plaintiff's employment for one year. Id. 19 STOCK CORPORATION LAW. Recognition and election as secretary, by board of managers of corporation, resting upon mistaken supposition, are not equivalent to, or available as, election as manager, required by law. People ex rel. Nicholl v. N. Y. I. Asylum, 122 N. Y., 190. To restore him to such office, writ of mandamus will not issue. Id. Nor will it issue when office filled by election. Id. Power of president to indorse notes must be shown, in order to charge corpora- tion. Nat. Bk. of Rep. v. N. P. Co., 56 Hun, 136. Proof of previous indorsement by him is insufficient. Id. Corporation is chargeable with possible, as well as actual, knowledge of trustees. Id. Promise by president will not bind corporation in absence of proof of authority to make promise, or put construction on contract. Johnson v, U. S. &8. Co., 3< N. Y. St. Rep., 876. Contract executed in name of corporation by president and secretary and sealed with corporate seal, is valid until contrary is shown. Jourdan v. L. I. R. R. Co., 11 5 N. Y., 380. Corporation can not refuse to carry out unauthorized contract, which it had power to make, supposed it had made, and performed while profitable. Id. Authority by person to bind corporation may be inferred from facts and circum- stances. Howell v. J. E. D. Co., 36 N. Y. St. Rep., 803. Person suing upon such contract must establish such authority. Id. In absence of de jure or de facto treasurer, any manager or director can en- dorse corporation's name for purpose of collecting commercial paper. C. M. Co. v. Mer. Bk., 59 Hun, 561. When corporation will be bound by indorsement made by agent. Lake Shore Nat. Bk. v. Butler Col. Co., 51 Hun, 63. Payment by corporation of note given on its behalf, establishes authority of person giving it. Davies v. N. Y. C. Co., 36, 816. Acquiescence by board of directors in assumption of exclusive management by officer, estops bank from disputing validity of arrangement made by him in its business. Id. Fact that plaintiff is bona fide holder can not make treasurer's indorsement of accommodation note corporate charge. Wahlig v. 8. P. Co., 36 N. Y. St. Rep., 390. Contract made and signed by party, though referred to therein as agent for cor- poration, is individual contract of such party. Barber A. P. Co. v. Brand, 27 N. Y. St. Rep., 883. Power of officer to contract debts to bind manufacturing corporation. Rathburn . Snow, 15 Daly, 141. Claims purchased at nominal sum by director, to offset demands of creditors against insolvent corporation, will be allowed only at amount actually paid. Bulk- ley v. Whitcomb, 121 N. Y., 107. Parties dealing with corporation are chargeable with notice of restriction on powers of its officers. Bohm v. V. L. G. B. Co., 30 N. Y. St. Rap., 424. Trustees can not create, by implication, liability which they are prohibited from directly creating. Id. Contract in name of corporation in general line of its business, by its accredited manager, though incompetent under by-laws, is binding upon, and admissible against, it. Hamilton C. Co. v. Bernhard, 40 N. Y. State Rep., 875. Subsequent delivery by company, under contract, is ratification, even though officer wasincompetent. Id. Treasurer of water company has no authority, by virtue of office, to bomm money and give company's note therefor. First Nat. Bank v. C B. C. W. W. Co., 56 Hun, 412. Directors of corporation, fraudulently putting corporate notes in circulation, are liable in tort, presumptively for face value. Met. R. Co. v. Kneeland, 120 N. Y., 134. Those who did not vote to issue them are not liable. Id. Corporation can not recover against its authorized officer for his acts, unless fraud is shown. Holmes, B. & H. v. Willard. 24 N. Y. St. Rep., 260. Loan of money by corporation is not ultra vires. Id. When officers of corporations not liable for injuries through ultra vires bueine**. H., B. & H. t>. Willard (Ct. of App., 1890), 125 N. Y., 76. 20 STOCK CORPORATION LAW. Power to remove at pleasure, conferred upon board of officers, may be exercised without assigning cause or giving notice to incumbents. Weidman t>. Board, etc., 26 N. Y. St. Rep., 765. Known by-law of corporation, providing that secretary should hold office during pleasure of board of directors, gives unqualified right of removal. Douglass v. Mr. Ins. Co., 118 N. Y., 484. Trustee for bondholders under second mortgage may release errors in decree of foreclosure of prior mortgage. Loeb v. Chur, 25 N. Y. St. Rep., 996. Officer of corporation need not surrender his security without payment or tender thereof. Id. He is not bound to sacrifice his own interests in looking after its interests. Id. Creditor can not attack action of officer without proof that he has sustained damage thereby. Id. Burden of proof is upon party dealing with alleged agent of corporation to prove his authority. Wilson v. K. C. E. R. R. Co., 114 N. Y., 487. Corporation is liable for mistaken act of employe within line of duty. Baylie . 8. C. Co., 38 N. Y. St. Rep., 492. Corporation having legal status and general business office in this state, is liable for acts of its agents to those dealing in reliance upon their authority. Beuesch v. J. H. M. L. Ins. Co., 16 Daly, 394. In such case, special limitations do not control. Id. Stockholder, in absence of agreement, is presumed to perform duties of office gratuitously. Mather v. E. M. Co., 118 N. Y., 629. Officer of corporation is not entitled to recover from corporation, in absence of agreement, for services rendered in legitimate discharge of official duties. Barrill v. Calendar I. Co., 50 Hun, 257. Corporation is not liable for services rendered upon employment of president, which are solely for his benefit. Van Valkenburgh v. T. T. & 6. R. R. Co., 22 N. Y. St. Rep., 379. Spoliation of corporation by excessive increase of salary, made to induce stockholders to sell stock, will be enjoined. Ziegler v. Hoagland, 52 Hun, 886. Officer of corporation may charge for services rendered, and demand fair profit thereon in erecting building for himself, on its sale to corporation. Gamble . Queens Co. W. Co., 123 N. Y., 91. Directors of company have no authority to vote interest bearing bonds to them- selves as gratuity. V. T. W. C. Co. v. M. T. Co., 35 N. Y. St. Rep., 141. Trustees can not purchase blocks of lot from cemetery corporation and deal with property for their own benefit. Palmer v. C. H. Gem., 122 N. Y., 429. Superintendent may purchase, when not produced by unfair and illegal means. Id. Person discounting note issued for salary of president, pursuant to resolution of board of directors, is bona fide holder for value. Wilson v. Met. R. Co., 120 N. Y.. 145. By purchasing without inquiry, he assumes only risk of proving such reso- lution. Id. Officer can recover against corporation for services only on quantum moruit. Copeland V. John Mfg. Co., 19 N. Y. St. Rep., 212. Corporation is entitled to recover, money paid to officers as salary under invalid resolution. A. H. G. M. & M. Co. v. Andrews, 120 N. Y., 58. Agreement between officers of corporation to accept reduced salary, not com- municated to or acted on by it, can not be enforced by corporation. R. T. Co. v. Brook, 37 N. Y. St. Rep., 506. When director liable for services performed for corporation. Taylor v. Nostrand, 35 N. Y. St. Rep., 332. Sheridan E. L. Co. v. Chatham N. Bk., 52 Hun, 575 ; Olcott v. Tioga R. R. Co., 27 N. Y., 546 ; Hoyt v. Thompson's Exrs., 19 id., 207; Com. Bk. v. Norton, 1 Hill, 304 ; Emerson v. Providence H. Mfg. Co., 12 Mass., 237 ; Renwick v. Bancroft, 56 Iowa, 527; People's Bk. v. St. Anthony's, etc., 39 Hun, 498; Melledge v. Boston I. Co., 5 Gush., 158 ; Lake S. N. Bk. v. Butler C. Co., 51 Hun, 63 ; Ex. N. J Monteath, 17 Barb., 1,1 ; aff'd, 26 N. Y., 505; De Witt v. Walters, 9 N. Y., 572; Brown v. B. & D. Bk., 6 Hill, 443 ; Moss v. Livingston, 4 N. Y., 203 ; Marine JN. Bk. v. Butler C. Co.. 23 N. Y. St. Rep., 318 ; Martin v. Mfg. Co., 44 Hun. 132; Same v. Webb, 110 U. 8., 7, 15 ; Bank of Attica v. P. & S. Mfg. Co., 17 N. Y. St. *ep., 327 ; Alexander v. Cauldwell, 83 N. Y., 480 ; De Bost v. Albert Palmer Co., 21 STOCK CORPORATION LAW. 36 Htm, 886 ; P. ft M. Bk. v. B. & D. Bk., 14 N. Y., 623 ; Meads v. Merchant* Bk., 25 id, 143 ; Banking Asso'n v. White L. Co., 35 id., 505 ; Cooke v. State Nat. BK., 52 id., 96 ; Edwards v. Shaffer, 49 Barb., 291 ; Bank u Cornew, 37 N. Y., 830 ; Same v. Railroad Co., 106 N. Y., 196 ; Second Nat. Bk. v. P. & 8. Mfg. Co., 66 Super., 216 ; Mayor, etc., v. Tenth Nat. Bk., Ill N. Y., 446; Holden v. N. Y. & E. Bk., 77 id., 291 ; Atlantic Bk. v. Savery, 32 id., 291 ; Cragie t>. Hartley, 99 id, 131 ; Jourdan v. Long I. R. R. Co., 115 id., 380 ; Wilson v~ Kings Co. E. R. R. Co., 114 N. Y., 487; Woodruff v. R. & P. R. R. Co., 108 id., 39; Wild t. N. Y. & 8. M. Co., 59 id., 644 5 Scott r Middletown. etc., R R. Co., 86 id., 200; Merrill u Consumers' C. Co., 114 id., 216; Barril v. Calendar I. & W. Co., 50 Hun, 257; Ashley v. Kinnaw, 18 N. Y. St. Rep., 791. Secretary and director representing corporation in selling ^oods on credit and making terms has power to pledge credit of corporation to assist customer. Hess v. W. & J. Sloane, 66 App. Div., 522. 28. Inspectors and their oath. The inspectors of election of every stock corporation shall be appointed in the manner prescribed in the by-laws, but the inspectors of the first election of directors and of all previous meetings of the stockholders shall be appointed by the board of directors named in the certificate of incorporation. No director or officer of a mouied corporation shall be eligible to election or appointment as inspector. Each inspector shall be entitled to a reasonable compensation for his services, to be paid by the corpora- tion, and if any inspector shall refuse to serve, or neglect to attend at the election, or his office become vacant, the meeting may appoint an inspector in his place unless the by-laws otherwise provide. The inspectors appointed to act at any meeting of the stockholders shall, before entering upon the discharge of their duties, be sworn to faith- fully .execute the duties of inspectors at such meeting with strict impartiality, and according to the best of their ability, and the oath so taken shall be subscribed by them, and immediately filed in the office of the clerk of the county in which such election or meeting shall be held, with a certificate of the result of the vote taken thereat. Former section 28 amended. See section 7, title 4, chap. 18, part 1, R. S., and section 28, chap. 611 of 1875, now repealed. Who may be inspectors of corporate election. Matter of Chenango Co. Mut. Ins. Co., 19 Wend., 635. See Matter of Mohawk & H. R. R. Co., id., 135. Inspectors of a corporate election may be candidates at such election. Ex Parte Willocks, 7 Cow., 402, An election, under the appointment and authority of one inspector, is void. Matter of Lighthall Mfg. Co., 47 Hun, 258. Such appointment does not satisfy the language of the law, and he has no authority to hold an election. Id. An election of directors will not be set aside on a summary application to the supreme court for that purpose, on the ground that the inspectors were not sworn in the form prescribed by the statute. Matter of Mohawk, etc., R. R. Co., 19 Wend., 135. Such election will not, it seems, be set aside upon such application, though no oath whatever was administered to the inspectors, if no objection waa interposed at the time of the election. That they were duly appointed and entered on the discharge of the duties of their office, is sufficient. In such case, they are inspectors de facto. Id. 29. Books to be kept. Every stock corporation shall keep at its office, correct books of account of all its business and trans- actions, and a book to be known as the stock-book, contain- ing the names, alphabetically arranged, of all persons who are stock- 22 SfOO& COKPOilATION LAW. holders of the corporation, showing their places of residence, the number of shares of stock held by them respectively, the time when they respectively became the owners thereof, and the amount paid thereon The stock-book of every such corporation shall be open dailv during at least three business hours foi the inspection of its stockholders and judgment creditors, who may make extracts there- from. No transfer ot stock shall be valid as against the corporation its stockholders and creditors for any purpose except to render th* transferee liable for tne debts of the corporation to the extent pro- videdform this chapter, until it shall have been entered in such book as required by this section, by an entry showing from and to whom transferred. The stock-book of every such corporation and the books of account of every bank shall be presumptive evidence of the facts therein so stated in favor of the plaintiff, in any action or proceeding against such corporation or any of its officers directors or stockholders. Every corporation that shall neglect or refuse to keep or cause to be kept such books, or to keep any book open for inspection as herein required, shall forfeit to the people the sum of fifty dollars for every day it shall so neglect or refuse. If any officer or agent of any such corporation shall wilfully neglect or refuse to make any proper entry in such book or books, or shall neglect or refuse to exhibit the same, or to allow them to be inspected and extracts taken therefrom as provided in this section, the corporation and such officer or agent shall each forfeit and pay to the party injured a penalty of fifty dollars for every such neglect or refusal, and all damages resulting to him therefrom. Amended by ch. 354 of 1901. In effect April 16, 1901. Former section 2:' amended See section 1, title 4, chap. 18, part 1, R. S., sections 16, 17, chap. 611 of 1875, and section 29, chap. 40 of 1848, now repealed. The provisions of section 29 are intended solely for the protection of the corpora- tion. Chemical Nat. Bink v. Colwell, 43 N. Y. St. Rep., 876 ; Isham v. Bucking- kam, 49 N. Y., 216; Robinson v. National Bank, 95 id., 637; McNeil v. Tenth Nat. Bank, 46 id., 331 ; Leitch v. Wells, 48 id., 58f). They can be waived or as- serted at its pleasure, are without effect, except for the protection of the corpora- tion, and do not operate to prevent the passing of the entire title, legal and equit- able, in the shares, as between the parties, by the delivery of the certificate, with assignment and power to transfer. Id Formerly one, who took a certificate with the usual power of attorney, as be- tween himself and the transferrer, the whole title, both legal and equitable, and it makes no difference that the blanks were not filled up. Cutting v. Danaerel, 88 N. Y., 410 ; Holbrook v. N. J. Zinc Co., 57 id., 616; Driscoll v. W. B. & C. M. Co., 59 id., 96. This rule applied especially to cases in which the direct question arises between the stockholder and the corporation. Id. But this section re- in >ves the distinction and makes an entry, on the books, of the transfer essential to relieve the stockholder from liability. The general rule is that the stockholder whose name is on the books is liable. Cutting v. Damerel, ante. This rule includes actions to enforce the statutory liability of a stockholder to a creditor of the company. Id. The case of Ro.^velt v Brown, 11 N. Y., 148, holds that as to debts the holder of the stock is a stockholder under the statute. A purchaser of stock not transferred on the books of the company is liable to 6iy the debts of the company as though he had entered the transfer. Johnson v. ndeihill. 52 N. Y., 203. Two conditions are necessary to be observed, in order to make a valid sale and 28 STOCK CORPORATION LAW. transfer. Section 40 prohibits all transfers until all previous calls thereon shall have been fully paid in ; and this section (29) provides that no transfer shall be valid as against the corporation, its stockholders and creditors for any purpoae, except to render the transfer liable for the debts of the corporation according to the provisions of this chapter, until it shall have been entered in the book of the company as required by this section, by an entry showing from and to whom transferred. Billings v. Robinson, 28 Hun, 122. Section 26 authorizes the directors to refuse consent to a transfer of slock under certain conditions therein specified. To make the transfer available as a protection against the company, its stock- holders and creditors, from paying the balance due on the shares held, the trans- action must be an honest one, entered into in entire good faith, with the intent and purpose of disposing of the entire interest in the shares and surrendering all dominion over them. Billings v. Robinson, ante; Veiller v. Brown, 18 id., 371; Sanger v. Upton, 91 U. 8., 56 ; National Bk. v. Case, 99 id., 628 ; Sawyer v. Hoag, 17 Wall., 619. This section does not make the book, prt vided for therein, the only or even the best evidence of the fact that a person is a stockholder. Herries v. Wesley, 1 3 Hun, 492. The person, who appears upon the transfer books to be a stockholder, may, as between himself and third parties, have parted with all his interest in the stock, but, as between himself and the corporation, he, and he only, is treated as , stockholder. Rosevelt v Brown, 11 N. Y., 148. An absolute transfer upon the books can not be explained or controlled by any separate and distinct agreement entered into between the parties to. such transfer. Id. The title still remains, as against the corporation, the stockholders and creditors, in the original holder, where the stock is hypothecated and afterwards assigned to trustees for the benefit of creditors, and neither the pledgee nor assignee takes a transfer upon the books of the company, or causes himself to be registered as stockholder. Richardson v. Abendroth, 43 Barb., 162. The legal title is in, and the legal liability for debts of the corporation upon, him in whose name the stock is registered, though others may have a lien upon, or equitably own it. Id. This section does not affect, as between vendor and vendee, the validity of an assignment in reality made, though the stock is not transferred in legal form. Johnson v. Underbill, 52 N. Y., 203. Such vendor is, in effect, but the nominal holder. Id. Both vendor and vendee are primarily liable to creditors of the com- pany, in accordance with the provisions of this section. Id. And each is liable to the other, in accordance with general legal rules. Id. ; Com. Bk. v. Kortright, 32 Wend., 348 ; Bk. of Attica v. Smalley, 7 Cow., 770 ; Gilbert v. M. I. M. Co., 11 Wend., 627. This section provides the means to the creditors of easily learning who were the stockholders at any time, and of easily showing the fact. Johnson v. Under- bill, ante. It holds any one ever a stockholder to a continued liability, unless there is put upon the proper book the entry which will show when he ceased to be a stockholder, and to whom he has transferred his stock. Id. In addition to the transferrer's liability, it makes the transferree liable also to the creditors. Id. The vendee of stock takes the shares subject to all the burdens and liabilities attached to and growing out of them. Id. He is liable to the vendor for any debts thereafter incurred by the corporation, which the vendor, under the pro- visions of this act, is obliged to pay by reason of his name still remaining upon the books as the apparent owner. Id. Until the transfer is actually made upon the books, the vendor is to be treated as the trustee of the stock for his vendee. Id. A transfer of ptock, valid as between the parties, but not consummated by an entry upon the book of registry of stockholders, does not divest the transferrer of liability as a stockholder to the creditors of the corporation. Shellington v. How- land, 53 N. Y.. 371. An entry upon the books of registry is required for the protection of the com- pany and its creditors. Id. Each creditor may hold the stockholders to their liability as such until they have divested themselves of the title to their shares by a completed transfer, as prescribed by law. Id. A transfer of stock made in good faith and at a time when the corporation is a going and solvent concern, and entered upon the corporate books, relieves the 24 STOCK CORPORATION LAW. transferor from all the responsibilities which attached to him as a creditor. Tucker v. Oilman, 121 N. Y., 189 ; Adderly v. Stone, 6 Hill, 624 ; Roeevelt v. Brown, 11 N. Y., 148; Johnson v. Underbill, 52 id., 203; Cutting v. Damerel, 88 id., 410. la an action under section 57 of this act, the corporate books are, to some ex- teat, evidence against stockholders who are chargeable with knowledge of their contents. Blake v. Gris>*W, 103 N. Y., 429. A subscriber is liable for the amount of hio subscription, though after calls are made, and before they are payable, he assigns his stock to a responsible party, and has it transferred to, and an account opened with him, on the books of the company. Schenectady, etc., Co. v. 11 N. Y., 102. The delivery of the certificate, as between the owner and assignee, with the as- signment and power indorsed, passes the entire legal and equitable title in the stock, subject only to such liens or claims as the corporation may have upon it. Cushman v. Thayer Mfg. J. Co., 76 N. Y., 365 ; McNeil v. Tenth Nat. Bk., 46 id., 331 ; N. Y. & N. H. R. R. Co. v. Schuyler, 34 id., 30, 80. Where a subscriber, after receiving his shares, made transferable upon the books of the corporation by the terms of the certificate, makes a transfer thereof in good faith, and the company accepts a surrender of his certificate, issues a new one to the transferee and credits him with the stock upon its books, the transaction amounts to a consent by the company to a release of the former stockholder from liability for future calls, and a substitution of the liability of the transferee. Bil- lings v. Robinson, 94 N. Y., 415 ; Cowles v. Cromwell, 25 Barb., 414; Isham . Buckingham, 49 N. Y., 220. But the issue of a new certificate to the transferee is not essential to effect this result, where there exist other circumstances which clearly indicate the intent of the parties, and establish by their mutual assent such release and substitution. Id. The delivery of a certificate, together with a power of attorney, authorizing the person to whom such certificate is delivered to transfer the shares upon the books of the company, transfers the title to such shares^to him without their formal transfer upon the books of the corporation. Dunn v. Star Fire Ins. Co., 19 W. Dig., 531 ; 7 Lans., 317. The liability of stockholder to creditors of the company is not discharged by a transfer of the stock on the corporate books, unless it is made in pursuance of an actual bona fide sale, without any secret understanding or trust in favor of the tranferrer. Veiller v. Brown, 18 Hun, 571. No member of a corporation can exonerate himself from liability, or defeat the claims of creditors, by transferring his interest to an insolvent person or to a bankrupt. McLaren v. Franciscus, 43 Mo., 452 ; or make a fraudulent transfer for the purpose of avoiding personal liability. Marcy v. Clark, 17 Mass., 330. The company is liable for an unauthorized refusal to transfer stock on its booke. Dunn v. Star Fire Ins. Co., 19 W. Dig., 531. The company should resist the transfer on its books without production and sur- render of the outstanding certificates, or proof of loss or destruction, and prooi that the real owner has applied for a new certificate. Smith v. Amer. C. Co., 7 Lans., 321 ; Cushman v. Thayer Mfg. J. Co., 76 N. Y., 365 ; N. T. & N. H. R. R. Co. v. Schuyler, 34 id., 83. An equitable action will lie to compel a transfer upon its books by a corpora- tion, of shares of its capital stock, to the owner of the same. Cushman t>. Thayer Mfg. J. Co., 76 N. Y., 365 ; Middlebrook v. Merchants' Bk., 41 Barb., 481 ; 21 How., 474 ; aff'd 3 Abb. Ap. Dec., 295 ; Com. Bk. v. Kortright, 22 Wend., 348 ; Pollock . Nat. Bk., 7 N. Y., 274 ; Purchase v. N. Y. Ex. Bk., 3 Robt., 164; White v. Schuyler, 1 Abb., N. S., 300 ; Buckmaster v. Consumers' Ice Co., 5 Daly, 313 ; Cushman v. Thayer Mfg. J. Co., 53 How., 60 ; aff'd 7 Daly, 330. The general rule is for courts of equity not to entertain jurisdiction for a specific perform- ance on the sale of stock. Cushman v. Thayer Mfg. J. Co., 76 N. Y., 365. But this rule is limited to cases where a compensation in damages will furnish a com- plete and satisfactory remedy. Id. Where a recovery of damages, for a refusal to transfer, will furnish an inadequate compensation, an equitable action is proper. Id. Any act suffered by the corporation, which wrongly invests a third party witt the ownership of shares of stock, without due production and surrender of the certificate, renders it liable to the owner. Cushman v. Thayer Mfg. J. Co., 76 N. Y., 865. 26 STOCK CORPORATION LAW. A provision in the act of incorporation, or in the by-laws, requiring transfers of stock to be made upon its books, ia for the benefit of the corporation. Robinson u. Nat. Bk., 95 N. Y., 637. This requirement will be deemed waived and non- essential, when it wrongfully refuses to obey its own rule. Id. Isham v. Buck- ingham, 49 N. Y., 220; Billings v. Robinson, 94 id., 415; Johnsan t>. Laflin, 17 Alb. L. J., 146. After refusal, without a valid reason, to make a transfer on its books, the corporation is bound to recognize the title of the assignee, precisely the same as though it had done its duty and made the proper entries. Robineon t>. Nat. Bk., ante. The transferee in such case is entitled to maintain an action to recover the declared dividends without a further request or demand. Id. His right is not affected by the fact that he can bring an equitable action to compel a transfer, or an action at law to recover damages for the wrongful acts of the com- pany. Id. Usually, a corporation, acting in good faith and without notice of the rights of others, may treat registered shareholders as the actual owners of the shares stand- ing in their names. Campbell v. American Zylonite Co , 122 N. Y., 455. But this rule is only applicable to such transactions as are within the express or implied powers conferred upon the company or its shareholders Id. The assignees of shares having possession of the certificates, though holding under unregistered transfers, are not bound by contracts between the corporation and the regis- tered, and all other stockholders, which are not within Buch express or implied powers. Id. As between the assignor and assignee, the unregistered assign- ment is void under this section. Id. The object of the provision of this section in regard to an exhibition or inspec- tion of the books is to give a liberal opportunity at all reasonable times to examine the books and to punish the person in charge who should willfully and intentionally deprive the creditors and stockholders of such examination. Kelsey v. Pfaulder P. F. Co., 41 Hun, 20. Where the company has provided a safe in which the books are kept, and the clerk, who has the key and combination of the safe, is necessarily called away for a short time, it is not unreasonable to request a creditor or stockholder to wait until the morning of the next business day, to see the books. Id. A willful and intentional attempt to deprive them of such examination must appear. Id. Where no statutory right to inspect the books of a corporation exists, the grant- ing 1 or refusing a writ of mandamus to compel the officers of such corporation to allow a stockholder to make such inspection is discretionary. Matter of 8age, 70 N. Y. 220 ; People ex rel. Hatch v. Lake Shore, etc., 11 Hun, 1. But this right is expressly given by this section, and the above cited cases do not apply to a pro- ceeding under it. People ex rel. McDonald v. U. 8. M. R. Co., 20 Abb. N. C., 192. Under this section, the books shall daily, during busing* hour?, be open for Ihe inspection of stockholders and creditors of the corporation, and their personal representatives, at its principal business office. Id. If either of these persons applies in person to inspect the books, and his application is refused, he is entitled to a mandamus as a matter of absolute right. Id. But a demand, made by his attorney-at-law, is insufficient to found a proceeding to compel inspection. Id. It may be doubted whether, even though a proper demand is made, such proceeding can be maintained against the company itself. Id. Any officer of the corporation, having the charge of its books, who, though he submits them to the inspection of the stockholder or creditor, shall yet refuse to permit him to take extracts therefrom, subjects himself to the penalty prescribed in this section. Cortheal v. Bronner, 5 N. Y., 562. A corporation is liable under this section for failure to exhibit the stock-book, when requested, and the exercise of due diligence to do so is not shown. Kelsey v. Pfaulder P. F. Co., 20 N. Y. St. Rep., 533. The stockholder need not show pecu- niary loss. Id. What does not constitute a waiver of the right to enforce the penalty. Id. The officer having the custody of the books is not constituted by this section a judge of the motives of the stockholder in making his inspection, or of the precise manner in which it shall be conducted, or of the purpose which the information thus obtained shall be made to subserve. Cortheal v. Browner, 5 N. Y., 562. This section does not authorize the custodian to close the books because the stock- holder or creditor, in the progress of his examination, may make an extract for any purpose. Id. A stockholder in an incorporated company can not be deprived of the right to 80 STOCK CORPORATION LAW. Inspect the books of the company because they ui-c kept in a particular way, or contain, along with the information to which he is entitled, other information vhi.-.h he has no right to demand. People ex rel. Richmond r. Puritir M E l Barl) , 217. If the corporation does not keep the books which the Matut- t r.ribes, it n its duty to permit an inspection of such as it does keep for ths pur- pose of recording the transactions, which the statute gives the stockholders the i vht to know. Id. Every stockholder has a right to know who are qualified voters, and the number df votes each shareholder is entitled to cast. People ex rel. Richmond v Pacific I.I. S. Co.. 50 Barb., 280 ; Cotheal v. Browner, 5 N. Y., 562. What is not such a denial of positive averments of ownership of shares con- tained in the applicant's affidavit for an inspection of the corporate books as to defeat an application for a mandamus to compel the company to permit an inspec- tion. Matter of Martin, 41 N. Y. St. Rep., 409. See also People v. Board, etc., 46 Hun, 296 ; People v. Cromwell, 102 N. Y., 477 ; People v. Common Council, 77 id., 503; People v. Supervisors, 25 N. Y. St. Rep., 737; Sullivan v. Gilroy, 65 Hun. 285 ; Kelsey ?\ Pfaulder, 20 N. Y. St. Rep., 533. The fact that the b>-lws of the company direct that the books shall be in the charge of the secretary is no defense to such application, where the refusal of the treasurer to permit inspection ia unqualified, and not put on the ground of inability Matter of Martin, ante. Under section 17, chap. 611, of 1875, it was held that the right of the stockholder* to inspect the books of account included the right to take extracts therefrom . Matter of Martin, 41 N. Y. St. Rep , 409; though it contains no provision, In ex- press language, to that effect. Id. But such right is conferred expressly by sect. 29 of this act. The directors, if deprived of the possession of the stock -book of the company, may open a new one, making it as far as possible a copy of the old book Hcho- harie Valley R. R. Co., 12 Abb., N- S., 394. The inspectors of election may, in tuch case, properly refer to the new stock-book to ascertain who are voters, id. But, if the old book is produced, the record therein must govern in reference to trans- fers therein before the new book was opened. Id. The books of account of a corporation are not competent evidence, of themselves, to establish an account or claim against a trustee or stockholder in an action brought in behalf of the corporation. Rudd v. Robinson, 126 N. Y., ife ; 30 N. Y. St. Rep., 500 ; Hager v. Cleveland, 36 Md., 476 ; Hill v. Manchester, etc., W. W. Co., 5 B. & Adol., 866 ; Haynes v. Brown. 36 N. H., 545 ; Chenango Bridge Co. v. Lewis, 63 Barb., Ill ; Olney v. Chadsey, 7 R. I., 224 ; Wheeler v. Walker, 45 N. H., 355 ; Pearsall v. W. U. T. Co., 35 N. Y. St. Rep., 307. A. director or stockholder is not charged with actual knowledge of the entries made in the books of the company. Rudd v. Robinson, ante. It is the general rule that the books of the company, containing the transactions of the corporation, are admissible in evidence in respect to such transaction* against officers and members of the corporation. Billings v. Trask, 30 Hun, 314. But it is very doubtful whether this rule can be extended to make the private ac- counts with the* individuals dealing with the corporation, whether themselves stock- holders or not, evidence of indebtedness to charge stockholders or officers with liability to penalties. Id. If admissible, it is not conclusive, but subject to x- planation and rebuttal. Id. See further, on the examination of corporate books, Matter of Hun, 557 Where the officers of a corporation on three different days refused a stock- kolder permission to inspect the stock book, it constituted but one offense. Cox v. Paul, 175 N. Y., 328. Section applies to stockholder in National Bank. People ex rel. Lorge v. Consol. Nat. Bank. 105 App. Qiv. 409. Stockholders have absolute right to inspection of stock book, regardless their motives. People ex rel. Callahan v. Keeseville, etc., Co., 106 App. Div. 349. Penalty, etc., is not cumulative. Walcott v. Little, 46 Mis. 96. 30. Annual report to secretary of state. Every domestic stock cor- poration and every foreign stock corporation doing business within this state, except moneyed arid railroad corporations, shall, annually, during the montl January, or' if doing business without the United States, before the f of May, may make a report as of the first day of January, which will state: Lt I STOCK CORPORATION LAW. 1. The amount of its capital stock, and the proportion actually issued. 2. Tlie amount of its debts or an amount which they do not exceed. 3. The amount of its assets or an amount which its assets at least equal. 4. The names and addresses of all the directors and officers of the company, and in the case of a foreign corporation, the name also of the person designated in the manner prescribed by the code of civil procedure, as a person upon whom process against the corporation may be served within this state. Such report shall be made by the president or a vice-president or the treasurer or a secretary of the corporation and shall be filed in the office of the secretary of state. It' .such report be not so made and filed, any such officer who shall thereafter neglect or refuse to make and to file such report, within ten days after written request so to do shall have been made by a creditor 'or by a stockholder of the corporation, shall fovfrit to the people the sum of fifty dollars for every day he shall so neglect or refuse. Amended by eh. 354 of 1901. In effect April 16, 1901. . Amended by ch. 415 of 1905. lu effect September 1, 1905. Former section 30, as amended by laws 1892, chap. 2, farther amended. Se section 12, chap. 40 of 1848, section 18, chap, till of 1875, and Motion 1, chap. 208 of 1884, now repealed. As to annual report, under this section, see N. Y. Law Review, No. 1, vol. 1, pp. 13-14. The object of this section is stated in Cincinnati Cooperage Co. v. O'Keefe, 44 Hun. 64. The purpose for which the annual reports are required, stated. Pier v. Hanmorc, M N. Y., 101 ; Walton . Godwin, 58 Hun, 91 ; 33 N. Y. St. Rep., 886 ; Torbett TV Godwin, 41 N. Y. St. Rep., 323. AH soon as a director parts with all beneficial interest in, and control over, the stock which the statute, section 2, chap. 567 of 1890, requires him to hold, and requests the officers of the corporation to make a proper transfer of such stock on the hooks of the company, he ceases to be a director, and ie not liable to creditors by reason of any subsequent failure to file the report under this section. Chemical Nat. Bk. t>. Colwell. 43 N Y. St. Rep., 876. A corporation is not liable for the acts of its trustees, done prior to the filing of the articles of incorporation and not ratified by it. Berridge r>. Abernethy, 24 W. Dig., 513. The filing of the certificate in the county clerk's office, immediately followed by user, renders the company a corporation de facto, and imposes upon it the duty of making and publishing a report. Meridan Tool Co. v Morgan, 1 Abb. N. C., 125 n. The duty, imposed by this section, of making and filing an annual report, is a corporate duty. Cornell v. Roach, 101 N. Y., 373. This duty is not cast upon the tmstees, either as such or in their individual capacity. Id. No penalty will be imposed under this section save in cases where the plain language of the section requires it. Whitaker v. Masterton, 106 N. Y.. 277 ; Whit- ney Arms Co. v. Barlow, 63 id., 62; Wiles v. Suydam, 64 id., 173; Bonnell v. Griswold, 80 id., 128 ; Brackett v. Griswold, 103 id., 425. Where a failure to tile the annual report has occurred, the moment the corpo- ration creates the debt, a trustee becomes liable to pay the pnme. Chapman v. Comsto^k, 58 Hun, 325 He hH incurred the statutory ppnnlty, and remains* linMo diiHu-r tho next three years ensuing. Id. At the end of the three years, the short statute of limitations becomes a bar to the creditor's right of recovery. Id.; Duckworth v. Roach, 81 N. Y., 49. Neither the continuance of the default, nor subsequent omissions on the part of the company to make a report, has the fleet to renew the old liability, create a new right of action, er stay the running of the statute of limitations. Id.; Rector, etc., v. Vanderbilt, 98 N. Y., 176. 28 STOCK CORPORATION LAW. Upon the default of a company to report, all the trustees then in office are jointly and severally liable for all the debts of the company then existing, whether con- tracted by them or their predecessors, and for all that may be subsequently con- tracted during- their continuance in office until such report is made. Vincent v. Sands, 42 How., 231; aff'd 58 N. Y., 672. Trustees, who upon such default, retire from office, are liable for all then exist- ing, but for no subsequent debts of the company. Vincent . Sands, 42 How.. 231 ; aff'd 58 N. Y., 672. Under section 18, chap. 611 of 1875, a trustee could escape the consequences of an omission, on the part of the company, to make and file the report, by himself subsequently and within a fixed time filing a certificate or report. Butler v. Smalley, 101 N. Y., 71 ; and a similar exemption is made by the provisions of this section. A trustee is liable for a default in filing the annual report which he can not con- trol, unless he makes and files a report within the time and in the form required in the latter part of this section. Vincent v. Sands, 42 How., 231 ; aff'd 58 N. Y., 672. This is a saving clause intended to protect the innocent, and willing trustee from personal liability. Their successors, by promptly obeying the requirements of this section, may escape all liability. Vincent v. Sands, 42 How., 231 ; afTd 58 N. Y., C72. If they continue the default till the next January, they are liable for the debts contracted during their administration up to that time, and for no other, unless they then and there make default. Id. In the latter case, they become liable for all the debts then existing. Id. The members of successive boards of trustees may become liable for the same debts, by reaso i of the successive defaults. Vincent v. Sands, 42 How., 231 ; aff'd 58 N. Y., 672 ; Boughton v. Otis, 21 id., 261 ; Shaler & H. Q. Co. v . Bliss, 27 id., 297; aflPg 34 Barb., 309; 12 Abb., 470; Garrison v. Howe, 17 N. Y., 458; Miller v. White, 57 Barb., 504. When directors of business corporation are liable for failure to file annual report, etc. P. E. P. Co. v. Coursey, 32 N. Y. St. Rep., 748. To make a trustee personally liable for the debts of the corporation, three things must concur : the trusteeship, the neglect to publish the annual report, and the debt. Chandler y. Hoag, 2 Hun, 613 ; aff'd 63 N. Y., 634. A trustee's liability depends upon the existence of the corporate debt, a default in making the report, and the trusteeship. Rector, etc. v. Vanderbilt, 20 W. Dig^ 488; Shaler, etc., Co. v. Bliss, 27 N. Y., 297 ; Duckworth v. Roach, 81 id., 49. Recovery in actions under this section is not in any respect based upon the theory of affording compensation to the creditor for damages sustained by reason of th omission to make and file a report. Stokes v. Stickney, 96 N. Y.. 323 ; Wiles v. Suydam, 64 id., 173; Easterly v. Barber, 65 id., 252 ; Knox v. Baldwin, 80 id., 610 ; Veeder v. Baker, 83 id., 156 ; Pier v. George, 86 id., 613. An action under this section is one to enforce a penalty. Victory W. P. Co. v. Beecher, 97 N. Y., 651 ; Merchants' Bk. v. Bliss, 35 id., 412 ; Jones t>. Barlow, 62 id., 202 ; Whitney Arms Co. v. Barlow. 63 id., 62 ; Wiles v. Suydam, 64 id., 173 ; Brice v. Platt, 80 id., 379 ; Knox v. Baldwin, id., CIO ; Easterly v. Barber, 65 id., 252 ; Veeder v. Baker, 83 id., 156 ; Pier v. George, 86 id., 613 ; Roach v. Duck- worth, 95 id.. 391 ; Stokes v. Stickney, 96 id., 323 ; Whitaker v. Masterton, 106 id., 277 ; Brackett v. Griswold, 103 id., 425 ; Gadsden v. Woodward, id., 242. The recovery allowed by this section against trustees is a penalty. Victory W. P. Co. v. Beecher, 26 Hun, 48 ; Merchants' Bk. v. Bliss, 35 N. Y., 412 ; Garrison v. Howe, 17 id., 458; Adams v. Mills, 60 id., 536, 553; McHarg v. Eastman, 35 How., 205 ; 7 Robt. 137. The liability of trustees, under this section, is in the nature of a penalty or punishment for the omission of a duty. Shaler & H. Q. Co. v. Bliss, 34 Barb., 309 ; aff'd 27 N. Y., 297. It attaches to the individuals and not to the office. Id. The liability imposed upon trustees of manufacturing companies for neglecting to make and file an annual report, is in the nature of a penalty for misconduct in office. Dabney v. Stevens, 40 How., 341; Bird v. Hayden, 2 Abb., N. 8., 61; McHarg v. Eastman, 35 How., 205 ; Merchants' Bank . Bliss, 35 N. Y., 412. The annual report must be filed each year after the organization of the corpora- tion. Jones v. Barlow, 62 N. Y., 202. The fact that it has not commenced busi- ness at the time prescribed for such filing, is no excuse for an omission BO to do. Id. A report, professedly incompliance with this section, will receive, in the absence 29 STOCK CORPORATION LAW. of any evidence of an attempt to deceive or to evade the statute, a liberal inter- pretation, and the benefit of any doubt as to its true intent and meaning will bo given to the trustees sought to be charged. Whitney Arms Co. . Barlow, 68 N. Y., 62. A report, signed by a majority of the actual trustees of a corporation, is a suffi- cient compliance with the requirement of this section. Wallace & Son v. Walsh, 52 Hun, 328. Vacancies may be brought about by resignations, and the number of trustees in this manner reduced. Wallace & Son v. Walsh, 52 Hun, 328. The stockholders may accept the situation and subsequently elect a less number. Id. The number I rescribed in the original certificate may be thus abandoned and legally reduced. Id.; S. C., 125 N. Y., 26. To meet the requirements of this section it is not necessary that the annual re- port shall be filed within twenty days from the first of January. Cameron v. Sea- man. 09 N. Y., 396. It is sufficient, when the report is prepared, signed and verified within such time, and filed as soon as practicable thereafter. Id. The provisions of this section, as to time of making and filing the report, is not complied with by doing so within twenty days before Ihe first of January, though it is regular in other respects. Cincinnati C. Co. v. O'Keefe, 120 N. Y., 603. The report must be made between the first and twentieth days of January inclusive in each year. Id. Good faith on the part of the directors in making and filing the report prema- turely is no defense to the liability imposed upon them for non-compliance with this provision. Cincinnati C. Co. v. O'Keefe, 120 N. Y., 603. The limitation of twenty days applies only to the act of making, and not to the act of filing the report. Butler v. Smalley, 101 N. Y., 71. As to the latter act, the section is directory. Id. The law, in the absense of an express provision on the subject, implies that the filing shall be within a reasonable time after the twenty days. Id. This requirement exacts prompt performance and diligent action on the part of the trustees. Id. This rule leads to an inquiry in any given caae, whether the party on whom the duty is imposed is shown to be in -default. Id. 5 Cameron v. Seaman, 69 N. Y , 396. In the absence of want of good faith and active diligence, a trustee will not be subjected to a penalty, provided the thing required is actually done at a reasonable time, having regard to the nature and circum- stances of the performance. Butler v. Smalley, 101 N. Y., 71. Under the former statute, the report had to be both filed and published ; Gilder- sleeve v. Dixon, 6 Daly, 76 ; but filing alone is sufficient under this section. A failure to file the report within a reasonable time after the twenty days al- lowed by this section for making it, is of itself a sufficient violation of the act to subject the trustees to the penalty. Butler-?). Smalley, 49 Supr , 492. Where there is no obstacle or excuse offered for the delay in such case, the trustees are liable without regard to the question of their good faith. Id. The requirement of this section is not satisfied by a filing in the month of Decem- ber previous, although done within twenty days before the first of January. Cincinnati Cooperage Co. V. O'Keefe, 44 Hun, 64. Where the acting board of trustees have filed a duly signed and certified annual report within the prescribed time, it is a compliance with the letter and spirit of the law. Wallace v. Walsh, 125 N. Y., 26. In such case, it is not competent for a creditor to show that some of the acting trustees were not duly elected or for some reason were disqualified from acting, or to claim that, by reason of a non- performance or an irregularity in the performance of some prior duty enjoiiifd upon the stockholders, said board had no authority to perform the general duties required of them as agents of the corporation. Id. \ A report made by a corporation under this section, if signed by seven trustees, is in this respect a valid report. Cornell v. Roach, 101 N. Y., 373 ; section 2, chap.' BK7 of 1800. An annual report, signed by two trustees, where the certificate of incorporation was signed by seven and acknowledged by nine trustees, does not satisfy the pro- visions of this section, unless it is shown by an official record that the number of trustees has been sufficiently reduced by resignation or otherwise. Westerfield t>. Radde, 67 How.. 204. Where there are five trustees of a corporation, of which the president is one, a report, signed by the president and two trustees, complies with the statute. Glen'e F. P. Co. . White, 18 Hun, 214. 30 STOCK CORPORATION LAW. A statement in the report that the amount of its existing debts does not excd ?7fc-:39, is sufficiently specific. Glen's F. P. Co. v, White, 18 Hun, 214. A verification of the report by the president to the effect that it is, in all respects, true to the best of his knowledge and belief, is sufficient. Glen's P. P. Co v White, 18 Hun, 214. The verification to a report in the following language : "Swoi-n to before me this l:?th Jay of January, 1870, Charles W. Anderson, Notary Public, New York County," was held sufficient, where the report was signed by the president of the corporation and actually verified by him before a proper officer. Bormell . (}riBwold,-80 N. Y., 128. It is not necessary, under this section, to specify in the report how much of th capital stock was paid in cash and what amount in property. Whitaker t>. Ma- terton, 106 N. Y., 277. 'A statement, from which it can not be determined what proportion of the capital stock has been paid in in cash, and how much has been issued for property, ia defective. Glen's F. P. Co. t>. White, 18 Hun, 214. See Whitaker v. Masterton, 21 W. Dig., 209; Pier v. George, 17 Htm- 907. The amount of cash paid in, and the amount of stock issued for personal property transferred to a corporation, need not, under this act, be separately specified in the annual report made and filed by the trustees. Whitaker v. Masterton, 106 N. Y., 277. Prior to the enactment of chap. 510 of 1875, the report was required to comply with both chap. 40 of 1848 and chap. 333 of 1853. Pier v. George, 17 Hun, 207 ; Blake v. Wheeler, 18 id., 496 ; aff'd 80 N. Y., 128. Where the capital stock was all issued in payment for patent rights, a report, made and filed, stating that "the amount of the capital stock of the company, which has been issued for patent rights, and which has not been paid in cash, is f300,000," which is the amount of capital stock, is a sufficient compliance with this section to save the trustees from liability. Whitney Arms Co. v. Barlow, 63 N. Y., 62. A person, who becomes a trustee after twenty days from January first, is bound, if he desires to avoid personal liability, to publish the annual report. Chandler u Hoatf, 2 Hun, 613 ; aff'd 63 N. Y., 624. This section makes no distinction as to the place where the debts shall have been contracted, nor does it distinguish between creditors residing in this or in other tates. Sears 1>. Waters, 44 Hun, 101. A judgment of record against a corporation ia a " debt," for which the trustees are liable under this section. Lewis v. Armstrong, 8 Abb. N. C., 385. A gilk of bonds by the company, as a mere gratuity, does not constitute a debt against it in such a sense as to justify a recovery against the trustees under this section. Norris v. De Wolf, 12 Hun, 666 ; aff'd 76 N. Y., 597. The provision of this section does not include an indebtedness imposed upon the corporation by fraud or improper practices of the creditor. Adams v. Mills, 60 N.Y., 533. Bonds, issued by a manufacturing corporation, and to the knowledge of the holder diverted from the purpose for which they were intended and authorized, are not, in the hands of such holder, a debt against the company, within the mean- ing of this section. Kirkland v. Kelle, 99 N. Y., 390. Under the statute of 1848, it was held that certain kinds of liability, which must ultimately ripen into " debts," are not " debts " within its meaning. Cviatt . Hughes, 41 Barb., 541 ; Whitney Arms Co. v. Barlow, 68 N. Y., 34; Victory W. P. Co. v. Beecher, 26 Hun, 48. The "debts," for which the trustees are made liable by this section, do not in- clude, it teems, unliquidated claims for breaches of contract and causes of action incidently arising or resulting therefrom, which the company might meet and de- defeat by some sufficient defense. Victory W. P. Co. ?>. Beecher, 26 Hun, 48. This liability does not depend upon the fact that he was a trustee when the debt was incurred, but upon his having been a trustee when the default in filing the re- port occurred. Bruce v. Platt, 80 N. Y., 379. This section does not render trustees liable for torts committed by the corpora- tion. Esmond v. Bullard, 16 Hun, 65 ; aff'd 79 N. Y., 404. A judgment against a creditor in favor of the corporation operates as an estop- pel in an action upon the same claim against its trustees because of failure to file the annual report. Tyng v. Clarke, 9 Hun, 269. A judgment for costs against a corporation, in an action for trespass commenced by it, ia such a debt of the corporation that a trustee is liable therefor under this 31 STOCK CORPORATION LAW. ction. Allen c. Clarke, 108 N. Y., 269 ; rev'g 43 Hun, 377. The trustee mm show that the recovery was either collusive or fraudulent. Id. Though sues judgment may not be conclusive as against him, it is at least prima facie evidence of its existence. Id. A judgment, which is in existence as a debt against the corporation at the time the default in filing the annual report happens, is a debt within the meaning of this section, for which the trustee in default is responsible. Lewis v. Armstrong, 8 Abb. N. C., 385. Where the report remains unfiled after the contingent liability of the company has become an absolute indebtedness by reason of due notice of non-payment of the draft by the acceptors, this section imposes upon the trustees a liability there- for, which a holder can enforce by an action. National Bank v. Fenton, 23 Hun, 309. It is essential to aver, in pleading under this section, that the debt, for which the trustee is sought to be made liable, was existing at the time the default was made, or that it was contracted afterwards and before the report w*,s published. Chambers v. Lewis, 28 N. Y., 4 r )4. Where there is no obligation giving a present right of action against the com- pany, there is no debt which can be demanded as a penalty against the trustee. Rector, etc., Ch. v Vanderbilt, 20 W. Dig., 488; Jones v. Barlow, 62 N. Y., 202; Whitney Arms Co v. Same, 63 id., 62 ; 68 id., 34. Act does not require debt to be due, but only to be existing at time of default in filing report. Carr v. Risher, 50 Hun, 147. The liability of a person who was not a trustee at the time of the default, but became such afterwards, is limited to debts created while he remains trustee, and while the default continues. Shaler & H. Q. Co. t>. Bliss, 27 N. Y., 297 ; Garrison v. Howe, 17 id., 458; Boughton v. Otis, 21 id., 261. In such case, the debt must have been contracted during a default, or have existed at the time of a subsequent default. Garrison v Howe. 17 N. Y., 458. This liability is subject to the same conditions and qualifications that attach to the original indebtedness. Jones v. Barlow, 62 N. Y., 202. Whatever will defeat or abate an action against the corporation will be a defense to the trustees. Id. They are only liable to an action for debts actually due, and for which a present right of action exists against the company. Id Causes of action against a trustee, arising under this section for failure to file a report, and under section 31 of this act for filing a false report, may be properly united. Bonnell ?'. Wheeler, 1 Hun. 332 ; aff'd 68 N. Y., 294. The burden of proof is upon the creditor to establish that the debt was contracted by the corporation. Dabney v Stevens, 40 Hun, 341. They can not avail themselves of a defense not personal to them, but going to the foundation of the claim and cause of action against the corporation, which would not be available in its favor. Whitney Arms Co. v Barlow, 63 N. Y., 62. A person, who is named as a trustee in the certificate, can legally act as trustee, though he does not, in fact, own any stock. McDowall v. Sheehan,129 N. Y.,200 ; 41 N. Y. St. Rep. 415 ; Davidson v. Westchester G. L Co., 99 N. Y., 658. A creditor, who has consented to non-filing of report, ran not take advantage of uch omission. Carraher v. Mulligan, 54 Hun, 638 ; 28 N. Y. St. Rep., 439. A trustee can not, as creditor of the corporation, maintain an action against his co-trustees under this section. Easterly v. Barber, 65 N. Y., 252. This rule ap- plies also to one who has acted as trustee, though not legally elected. Id. He can not repudiate his character as trustee and recover from those with whom he has acted. Id. Where a debt against a corporation, owned by a trustee, is assigned by him ab- solutely for value, the assignee, on a subsequent default of the company to make a report, may proceed under this section, though the assignor continues to be a trustee up to the time of such default. Cornell v. Roach, 101 N. Y., 373. An action can not be maintained against a trustee under this section by the as- signee of a demand, which, at the time of the failure to file the report, belonged to the president of the company. Bronson v. Dimock, 4 Hun, 614 ; Briggs v. Easterly, 62 Barb , 51. Where the debt is assigned after a trustee has become personally liable under this section, the assignee may maintain an action to enforce such personal liability. Pier v. George, 14 Hun, 568 ; Bolen v. Crosby, 49 N. Y., 183. The report is the act of the trustees, and the duty of making it is devolved upon 32 STOCK CORPORATION LAW. them. Bolen v. Crosby, 49 N. Y., 183. The secretary can not subscribe to H the names of the trustees, or verify it in any way to make it the act of the corpora- tion and a compliance with the statute, BO as to relieve the trustees from their duty, or the liability resulting from an omission to perform it. Id. He is not charge- able with the consequences of such an omission, nor precluded from maintaining an action to enforce the personal liability of the trustees under this section. Id. The liability under this section may be enforced by a creditor who is a stock- holder, aa well as by an outside creditor. Sanborn v. Lefferts, 58 N. Y., 179. A cause of action under this section is assignable. Bonnell v. Wheeler, 3 T. & C., 557; aff'd68 N. Y., 294. A cause of action against a trustee under this section is assignable, and may b enforced by the assignee of the creditor. Bonnell v. Wheeler, 1 Hun, 332 ; affd 68 N. Y., 294. An assignee of a claim against the corporation may maintain an action against a trustee thereoi, under this section. Pier e. George, 86 N. Y., 613. The assignment of a judgment against a corporation, carries with it the claim or debt upon which it is founded, and all rights and remedies for the recovery and collection of such claim or debt, including the remedy given by this section against the trustees. Bolen v. Crosby, 49 N. Y., 183. A creditor trustee can not alone, or in connection with his co-partners, nor can his assignee, maintain an action under this section. Knox v. Baldwin, 80 N. Y., 10 ; Briggs v. Easterly, 62 Barb , 51 ; Bronson c. Dimock, 614. In case of an assignment of a corporate debt, a release of one of the trustees by the assignor, after the releasee has notice of the transfer, will not operate to defeat the claim of the assignee. Bolen v. Crosby, 49 N. Y., 183. The right of a pledgee of corporate bonds, hypothecated to secure a loan, is not precisely the same as that of an owner, where the pledger is also one of the trustees, and liable with the others for not making the report. Roach v. Duck- worth, 95 N. Y., 391. He can enforce the bonds against the trustees only so far as is necessary to his indemnity. Id. To go beyond that point, would result in benefiting the pledger trustee. Id. Directors are not liable for failure to file annual report, where corporation ceases to exist before the debt becomes due. Gold v. Clyne, 58 Hun, 419. Debt can not be contracted until liability has been incurred. Id. The omission to publish, in the first twenty days of January, the statement required by this section imposes a personal liability upon the trustees in office for all the corporate debts existing while they are in default. Boughtou u. Otis, 21 N. Y., 261. But, in such case, they are not liable, it seems, for debts contracted after their retirement from office. Id. A trustee, coming into office after a default, is personally liable for such debts only as are contracted while he is in office, and before a report is made and published. Id. Trustees, who have neglected to make their report, are not personally liable for debts contracted until after they have ceased to be trustees of the company. Shaler & H. Q. Co. v. Bliss, 34 Barb., 309 ; aflPd 27 N. Y., 297. The fact that a stockholder has been elected a trustee does not alone invest him with that character so as to make him liable under this section. Cameron v. Sea/- man, 69 N. Y., 396. There must be an acceptance of the office on his part, either express or to be implied from the circumstances. Id. Under this section it is not enough to show that a person was elected a trustee, but some direct and positive act by him, assenting to this act of the stockholders, must also be proved. Osborne & C. Co. v. Croome, 14 Hun, 164 ; afFd 77 N. Y., 629 ; People v. Batchelor, 22 id., 12S ; Cameron v. Seaman, 69 id., 396. Where a corporation has never, in fact, commenced business, and, before the time prescribed for making an annual report has elapsed, the object for which it was formed becomes impossible for it to accomplish, and there is neither ability nor intention on its part at any time to prosecute its business, it is not required to make such report, and its trustees are not liable to creditors, because of its failure so to do. Kirkland v. Kille, 99 N. Y., 390. Trustees, who hold over and continue in office, are subject to all the liabilities imposed by law upon trustees regularly and annually chosen. Reed v. Keese, 60 N. Y., 616 ; Deming v. Puleston, 55 id., 655 ; Jan v. Lefferts, 16 Abb., N. 8., 42. A trustee, who was not legally, but was in form, elected and acted as such, is liable for a failure to file a report from the time of his election to the time of his resignation. Halstead v. Dodge, 51 Supr., 169. The fact that he was not a stock- holder is no defense. Id.; s. c., 1 How., U. 8., 170. 33 STOCK. CORPORATION LAW. A trustee may resign and relieve himself from liability thereafter incurred by it, though the resignation is not acted upon by the board of trustees or entered in the books of the corporation. Blake v. Wheeler, 18 Hun, 496 j aff'd 80 N. Y., 128 ; Chandler . Hoag, 2 Hun, 613 ; aff'd 63 N. Y., 624. It is not necessary for trustees to resign at the end of the year, in order to pro- duce a vacancy. Van Amburgh V. Baker, 81 N. Y., 46. A vacancy would come, in such case, from the termination of their terms of office. Id. Unless they con- tinue to act, after such time, as trustees, they are not liable for not making and filing a report in the following January. Id.; Deming v. Puleeton, 55 N. Y., 655 ; Reed v. Keese, 60 id., 616 ; 379 Super., 269 ; Vincent v. Sands, 33 id., 511 ; San- born v. LeflFerts, 58 N. Y., 179. A tmstee may resign his trusteeship. Squires v. Brown, 22 How., 35. In case of his resignation, he does not become liable for the debts of the company on the subsequent default or neglect of the remaining trustees to make and tile the annual report. Id.; Boughton v. Otis, 29 Barb., 196; aff'd 21 N. Y., 261 ; Shaler & H. Q. Co. v. Bliss, 10 Abb., 311 ; Yeung v. N. Y. & L. I. Co., id., 229 ; Garrison v. Howe, 17 N. Y., 458 ; Tracy v. Yates, 18 Barb., 152. A trustee, who resigns after the incurring of the debt, but before the default, is not liable. Bruce v. Platt, 80 N. Y., 379. It is not necessary for him to give notice to the public, the creditors or any persons other than his associates, of his intention to resign, or of his resignation. Id. A trustee has power to resign, and its acceptance and entry in the minutes of the corporation are not necessary to make the resignation complete. Chandler v. Hoag, 2 Hun, 613 ; aff'd 63 N. Y., 624. After a corporation is adjudged a bankrupt and its entire property passes into the hands of an assignee in bankruptcy, no report is necessary. Bonnell v. Gris- wold, 80 N. Y., 128. Where a company practically abandons its business, and all its business has been sold at sheriff's sale, the subsequent failure to make and file an annual report dos not make the trustees individually liable to a creditor of the' company. Wamg- ley v. Palmer, I N. Y. St. Rep., 307 ; even though the sheriff's deeds are defec- tive, and do not dejure convey the title to the property out of the coiporation. Id. The corporation, on the appointment of a receiver, is so far dissolved that there- after the duty is no longer upon the trustees to make the annual report. Hugue- not N. Bk. v. Studwell, 74 N. Y., 621. Where a receiver is appointed during and before the expiration of the twenty days in which the trustees are required to make such report, they are not liable to the penalty imposed by this section. Id. When a corporation, so far as the liability of trustees and stockholders is con- cerned, may be deemed to be dissolved. Bruce v. Platt, 80 N. Y., 379; Bradt t). Benedict, 17 id., 93 5 Slee v. Bloom, 9 Johns., 456 ; 20 id., 669 ; Pennusian v. Briggs, Hopkins, 300; Bank, etc., v. Ibbotson, 24 Wend., 473; Jones v. Barlow, 63 N. Y., 202 ; Garrison v. Howe, 17 id., 458 ; Huguenot N. Bk. v. Studwell, 74 id., 621 ; Losee v. Bullard, 79 id., 404 ; Bonnell v. Griswold, 80 id., 128 ; Brinker- hoff v. Brown, 7 Johns. Ch., 217 ; Sanborn v. Lefferts, 58 id., 179. A company, whose property has been exhausted by legal process, and which neither is doing or intending to do any other act in furtherance of the object of its incorporation, may be, for every practical purpose, deemed to be dissolved, and its obligation to file a report terminated. Bruce v. Platt, 80 N. Y., 379. The fact that a corporation has ceased to do business and is engaged in closing up its affairs, is no excuse for a failure to comply with the requirement of this section as to the filing of a report. Sanborn v. Lefferts, 58 N. Y., 179. In the absence of any legal dissolution of the company, these facts do not, nor does knowl- edge upon the part of the creditor of the financial condition and embarrassments of the corporation affect their liability. Id. Inability, or non-intention to continue business, excuses trustees from making annual report. Carraher v. Mulligan, 28 N. Y. St. Rep., 439 ; 64 Hun. 638. The mere fact of an application by the attorney-general at the instance of two of the trustees for the dissolution of the corporation upon grounds undisclosed, where half of the trustees actively oppose the application, does not relieve them from the duty of making and filing the annual report. First Nat. Bk. v. Lamon, 41 N. Y. St. Rep., 684 ; rev'g 29 id., 181. Upon this point, see Sanborn v. Lef- ferts, 58 N. Y., 179 ; Huguenot Bk. v. Studwell, 74 id., 621 ; Losee v. Bullard, 19 id., 404 ; Bruce v. Pltt, 80 id., 379 ; Van Amburgh v. Baker, id., 46 ; Kirkland v. Kille, 99 id., 390. 84 CTOCK CORPORATION LATT. Where proceedings have been initiated for the dissolution of a corporation, on an application made by the trustees to the Attorney-General before the expiration of the twentieth day of January, the trustees are not required, in order to shield themselves from personal liability for the corporate debts, to make the annual report. First Nat. Bk. v. Lamon, 65 Hun, 414 ; Van Amburgh v. Baker, 81 N. T., 46 ; Huguenot N. Bk. i>. Studwell, 74 id., 621 ; Bruce v. Platt, 80 id., 379 ; Bank t>f Poughkeepsie v. Ibbotson, 24 Wend., 473 ; Kirkland v. Kille, 99 N. Y., 390. The trustees are neither parties nor privies to a judgment by the creditor againnt the corporation. Miller v. White, 50 N. Y., 137. In an action against them to enforce their liability under this section, proof of the recovery of a judgment against the company ig neither conclusive nor prima facie evidence of the d<;bt. LI. A judgment against the corporation is not conclusive or binding upon the trustees in an action against them undei this section, as to the existence of the original cause or ground of action. Kraft v. Coykendall, 34 Hun. 285 ; Miller v. White, 50 N. Y , 137 ; Stephens v Fox, 83 id., 317 ; Rorke v. Thomas, 56 id., 565 ; Jones v. Barlow, . 202 ; Esmond v. Bullard, 16 Hun, 67 ; aff 'd 79 N. Y., 404; Whit- ney Arms Co. i> Barlow, 63 id., 62. Under this section, a judgment against the corporation is neither necessary to the liability of the trustees nor binding upon them. Rorke v. Thomas, 56 N. Y., 565 ; Kraft v. Coykendall, 34 Hun, 285. Even though the trustees should partici- pate and conduct the defense as trustees, they would not, probably, be concluded, by the judgment rendered in the action, in another suit against them personally under the statute. Id. An action against a trustee under this section must be founded on the original claim against the corporation, and not upon a judgment recovered against it. Esmond v. Bullard, 16 Hun, 65 ; aff 'd 79 N. Y., 404. Such judgment is not even prima facie evidence, as against the trustee, of the existence of the debt. Id.; Miller v. White, 50 N. Y., 137 ; Whitney Arms Co. v. Barlow, 63 N. Y., 62. In an action against a trustee to enforce his personal liability under this section, a judgment against the company is not even prima facie evidence of the existence of the debt, as against the trustee. Esmond v. Bullard, 16 Hun, 65 ; aff'd 79 N. Y., 404 ; Miller v. White, 50 id., 137 ; Whitney Arms Co. v. Barlow, 63 id., 62. For an omission to file a report, all the trustees are liable under this section. Bonnell v. Griswold, 68 N. Y., 294. The trustees are made jointly and severally liable for the debts of the company by reason of the omission to make the annual report required by this section. Moag v. Lamont, 60 N. Y., 96. A separate action is given to each individual creditor, by the words of this sec- tion, for his separate debt, though his is not the only debt against the corporation. Wiles v. Suydam, 16 Hun, 578. An action, under this section, may be brought against such trustees as the creditor may select, and the non-joinder of the others constitutes no defense. Hal- stead t>. Dodge, 51 Supr., 169; Strongs. Sproul, 4 Daly, 326; Quigleyv. Walter, 2 Sweeney, 175. As many actions, under this section, can be brought against the trustees as can be brought against the corporation. Roach v. Duckworth, 95 N. Y., 391. A creditor may sue all the trustees successively until he shall obtain satisfaction, or he may at the same time commence a suit against each trustee. Id. No trustee can properly set up the pendency of a suit, or the recovery of a judgment, against any other trustee as a bar to a recovery against him. Id. A judgment can be enforced only against the trastee who is defendant in the action. Id. Non-joinder of a co-trustee is not a'defense. Nimmonsi). Tappen, 2 Sweeney, 652 The question whether the trustees will, upon payment of the corporate debt, be abrogated to the right of the creditor against the corporation was not, though raised, decided in Jones v. Barlow, 62 N. Y., 202. Under chap. 510 of 1875, all the other trustees are bound ratably to contribute to the amount recovered against and paid by the co-trustee. Roach v. Duck- worth, 95 N. Y., 391. An action under this section does not abate by reason of the death of the creditor, though it will abate upon the death of the defendant trustees. Zoller v. O'Keeffe, 15 Abb., N. C., 483 ; Bonnell v. Griswold, id., 470. It was held, in Bank of California v. Collins, 5 Hun, 209, that an action against a trustee under this section did not survive against his personal representatives. 35 STOCK CORPORATION LAW. An action under this section is penal, and abates upon the death of either party before verdict. Blake v. Griswold, 104 N. Y., 013; Brackett v. Same, 103 id., 425 ; Stokes t>. Stickney, 96 id., 323. See semble to same effect inCarr v. Rischer, li< N. Y., 117. An action, under this section, does not absolutely abate upon the death of the trustee after judgment. Carr v Rischer, 119 N. Y., 117. A reversal of such judgment by the general term does not extinguish it for every purpose. Id. Though a new trial cannot be had, the judgment maybe restored on appeal to the court of appeals, and the action continued for that purpose. Id. Upon the death of the trustee, the action can not be revived against his personal representatives. Stokes v. Stickney, 96 N. Y., 323. A failure to tile the report renders the trustees liable for both existing and sub- sequently contracted debts. Carley v. Hodges, 19 Hun, 187. And where the failure occurs after the death of the creditor, the trustees are personally liable to hia executor. Id. The action, under this section, must be brought within three years from the time the cause of action accrued. Merchants' Bk. v. Bliss, 85 N. Y., 412 ; Rector v Vanderbilt, 98 N. Y., 170 ; Shaler & H. Q. Co. v. Bliss, 27 N. Y., 297 ; Duck- worth v. Roach, 81 N. Y., 49; Miller v. White, 50 N. Y., 137 ; Losee v. Bullard, 79 N. Y., 404. The action, under this section, need not be commenced within three years after the debt accrued against the corporation. Duckworth v. Roach, 81 N. Y., 49. If the debt existed and might have been the subject of an action at the time of the alleged default in complying with the requirement of the statute, an action may be commenced at any time within three years thereafter. Id. See Merchants' Bk. v. Bliss, 35 N. Y., 412 ; Jones v. Barlow, 62 id., 202. The statute of limitations, made applicable to such actions, begins to run only from the time a cause of action accrues, and not from the time of default in making the report. Jones v. Barlow, 62 N. Y., 202. The fact that the trustees make a report in a year subsequent" to the default, does not revive their liability. Wamsley v. Palmer, 5 N. Y. St. Rep., 807. It is simply evidence that they consider themselves as continuing in office. Id. Neither the continuance of default in paying a debt nor subsequent omissions of the company to make annual reports can renew the liability of a trustee for such debt, or create a new right of action, after it has been barred by the statute of limitations. Rector, etc., v. Vanderbilt, 20 W. Dig., 488. When the statute of limitations begins to run in favor of a trustee, nothing subsequent will stop it. Rector, etc., v. Vanderbilt, 98 N. Y., 170. Nothing can be presumed against the trustees, but every fact necessary to establish their liability must be affirmatively proved. Tovey v. Culver, 54 Supr., 404. The onus is upon the creditor, in an action under this section, to prove the default. Whitney Arms Co. v. Barlow, 68 N. Y., 34. Nothing can be presumed as against the trustee. Every fact necessary to establish his liability must be affirmatively proved, though it will necessitate the proving of a negative. Id. Where a complaint, under this section, sets out a copy of the report as filed and published, and alleges that it does not comply with the statute, the particular defects therein need not be set forth in the complaint. Glen's F. P. Co. v. White, 18 Hun, 214. In an action under this section, a trustee can serve an unverified answer to a duly verified complaint. Gadsden v. Woodward, 103 N. Y., 242 ; rev'g 38 Hun, 548. That the company is indebted to a trustee, is no defense on his part to an action by a creditor under this section. Morey v. Ford, 32 Hun, 446. In an action under this section, it is not a good defense that the trustee is him- self a creditor of the company to an amount equaling his stock. Richards v. Kinsley, 27 W. Dig., 372. A trustee, who has paid a creditor's claim after judgment in an action against him for non-Sling of an annual report, can not set off such amount in reduction of his liability under section 57 of this act. Veeder v. Mudgett, 95 N. Y., 295. In such action, a compulsory reference can not be ordered, though the only issue is as to indebtedness of the corporation on a long account. Hyatt v. Roach, 1 Abb, N C., 125. The clerk can not, in an action under this section, enter judgment on default under section 1212 of the Code. Gadsden v. Woodward, 38 Hun, 548. 36 tSTOCK COKl'OHAXiO.N LAW. In an action against several trustees, where process is served only on ecm of them, a recovery may be had, and judgment entered, in form, against all, but to affect only the individual property of the trustee served and the property owned jointly by all. Hoag v. Lamont, 60 N. Y., 96. The recovery of a judgment on a corporate claim against a stockholder under section 57 of this act is no bar to an action on the same claim against a trustee under thia section. Vincent v. Sands, 42 How., 231 ; aflPd 68 N. Y., 672. An action against the trustees, under section 30 of this act, to charge them with the same debt, is no bar to an action to charge the stockholders under this section. Douglass v. Ireland, 73 N. Y., 100. The mere fact of being a director and stockholder is not per se sufficient to hold a party liable for the frauds and misrepresentations of the active managers of it corporation. Arthur v. Griswold, 55 N. Y., 400. That the name of a person wa published as a trustee, and a certificate of stock issued to him, are not sufficient to authorize a recovery against him for a fraud perpetrated by other agents and trustees of the corporation. Id. Chapter 354 of 1899 applies to foreign corporations. Staten Islaml Midland E. Co. v. Hinchcliffe, 170 N. Y., 473. See also Shepard v. Fulton, 171 N. Y., 184. Statement verified by president and vice-president not sufficient. Rhodes v. Hinds, 79 App. Div., 379. See also Stevenson v. Cowan, 84 App. Div., 135. Complaint need not show compliance with section 34. Boynton v. Sprague, 100 App. Div. 443. As to corporations doing business without the United States, see Hoboken Beef Co. v. Haiid, 104 App. Div. 390. 31. Liability of officers for false certificates, reports or public no- tices. If any certificate or report made or public notice given by the officers or directors of a stock corporation shall be false in any material representation, the officers and directors signing the same shall jointly and severally be per- sonally liable to any person who has become a creditor or stockholder of the corporation upon the faith of any such certificate, report, notice or any ma- terial representation therein to the amount of the debt contracted upon the faith thereof if not paid when due, or of the damage sustained by any pur- cnaser of or subscriber to its stock upon the faith thereof. The liability im- posed by this section shall exist in all cases where the contents of any such certificate, report or notice or of any material representation therein shall have been communicated either directly or indirectly to the person so becoming a creditor or stockholder and he became such creditor or stockholder upon the faith thereof. No action can be maintained for a cause of action created by this section unless brought within two years from the time the certificate, re- port or public notice shall have been made or given by the officers or directors af such corporation. Former section 31 amended. See section 15, chap. 40 of 1848, and section 21, chap. 611 of 1875, now repealed. As to liability under this section, see N. Y. Law Review, No. 1, vol. 1, pp. 14, 15. This section must be strictly construed. Torbett v. Godwin, 62 Hun, 407; 27 Abb. N. C.,444. The liabilities imposed upon trustees for making false reports, and allowing the indebtedness of the corporation to exceed its capital stock, are in thr nature penal, and each act of this character enters into and becomes a separate cause of action. Anderson v. Speers, 8 Abb. N. C., 382. A trustee, who has not signed the report, is not liable under this section. Bonnell c. Wheeler, 3 T. & C , 557. For making and filing a false report, the trustees only, who do the act, are liable. Bonnell v. Griswold, 68 N. Y., 294 ; and only such of this number as know it to be false. Id.; Pier v. Hanmore, 86 id., 95. Director is officer of corporation. Brand . Godwin, 15 Daly, 456. Under section 21, chap. 611 of 1875, the term "officers," was held to include the directors or trustees of a corporation. Torbett v. Eaton, ante. Section 31 of this act, has made express mention of the directors. And by section 2, chap. 561 of 1890, the term "directors " expressly includes trustees. 37 STOCK CORPORATION LAW. A director of a business corporation is liable for all of its debts, without limit aa to the amount. Richard v. Croker, 19 Abb. N. C., 73. This section subjects the offending trustee to all the debta of the company con- tracted while he is a trustee thereof^ without regard to the amount of his stock and without any right of contribution. Pier v. Hanmore, ante. A trustee is not liable, under this section,[for debts of the corporation contracted before the report was made. Torbett r. Godwin, 41 N. Y. St. Rep., 328. This section must be taken to mean that, as to debts contracted after the report IB filed, the officers who signed it are liable. Torbett v. Godwin, 62 Hun, 407 ; 27 Abb. N. C., 444. They are not liable for claims which accrued prior to the filing of the report. Id. Breach of contract is debt within this section. Brand v. Goodwin, 24 N. Y. St. Rep., 305. The complaint, under this section, must allege that the debt was contracted while the defendant was a trustee. Anderson v. Speers, 8 Abb. N. C., 382. This penalty does not attach when the stock of the corporation hu been issued in payment for property, though this fact is not stated in the report. Bonnell v. Griswold, 80 N. Y., 128. In an action under this section, where the statutory certificate states that the whole of the capital stock has been paid up in full by the purchase of a certain described patent, the question of the value of the patent, and whether it was worth the amount of the stock, is one of fact for the jury, even though such cer- tificate in form follows the statute. Bolz v. Ridder, 19 W. Dig., 463. Where the capital stock is actually paid in in cash, the mere fact that the cor- poration bought out assets of an old company at their fairly appraised value, does not call for, or authorize, a statement in the report that the stock had been paid for in property. Wickens v. Foster, 22 W. Dig., 426. The trustees are not rendered personally liable for the corporate debts, under this section, by the mere omission to specify separately, in their annual report, the amount of stock issued for cash and the amount issued for property purchased by the company. "Whitaker v. Masterton, 21 W. Dig., 209. A report, which contains the names of persons as stockholders and states the amount of their stock as actually paid in, where in fact such persons are not stock- holders at all, is false in a material representation. Brandt v. Godwin, 3 N. Y. Supp., 807. The fact that the trustee signed such report in good faith, under ad- rice of counsel, and believing its statements to be true, is no defense to the statutory liability. Id. In an action, under this section, in a case where the certificate filed by the trustees states that the whole of the capital stock had been paid in fully by the purchase of a certain described patent, though said certificate in form followed the statute, the question of the value of the patent, and whether it was worth the amount of the stock, is a question for the jury. Bolz v. Ridder, ante. Directors, in issuing stock for property, must see that purchase price doea not oxceed fair value. Huntington v. Attrill, 118 N. Y., 365. Its then value is measure of consideration. Id. In judging of their knowledge and motive, they will be treated aa men of or- dinary discernment and sagacity. Id. Knowledge of falsity of report is not essential to liability. Id. Statute is constitutional. Id. Evidence of similar property, or opinion based upon knowledge of other property, is inadmissible in action for filing false report. Ante. This section does not limit the liability of the trustees for a materially false rep- resentation to a case in which it shall be fraudulently or knowingly made. Tor- bett t>. Eaton, 49 Hun, 209. In this respect, it differs from section 15, chap. 40, of 1848. That act contained the further requirement that the trustee signing the report, should do so, knowing it to be false. But the language of the present sec- tion follows and is identical, in this respect, with section 21, chap. 611, of 1875. Under the latter section, it was held that the liability of a director of a corporation Cor a false report did not depend upon his good faith in making and signing such report. Torbett v. Eaton, ante. In an action under this section, it is not necessary to show knowledge on the part of the officer at the time of signing. Huntington v. Attrill, 118 N, Y., 865 ; Torbett t?. Eaton, 113 id., 623 ; 49 Hun, 209. Proof that the statement is untrue in any material representation, is sufficient. Id. 88 STOCK CORPORATION LAW. To charge a trustee with the penalty imposed by this section, some act or cir- cumstance must be shown indicating- that it was made in bad faith, willfully, or for some fraudulent purpose, and not ignorantly or inadvertently. Bonnell v. Griswold, 89 N. Y., IV2 ; Pier v. Hanmore, 86 id., 95. This is a question of fact, which must be passed upon, before the liability can be adjudged. Id. The necessity of such proof is confined to cases where it is possible for the trustee to sign a false, under the belief that it is a true, report. Id. The penalty follows an actual, and not a constructive falsehood. Id. Butler -. Smalley, 101 N. Y., 71. Liability under this section does not attach, when a report is made and filed, in terms complying- with the statute, though some of the material representations therein are untrue. Bonnell v. Griswold, ante ; Pier v. Hanmore, ante. Where the trustee should knowingly state that a larger amount of capital had been paid in than had in fact been paid, or. state the indebtedness of the company at less than the actual amount, it can hardly be necessary to prove the purpose for which the misrepresentation was made, or that any particular fraud was in- tended. Pier v Hanmore, ante. When the knowledge of the trustee is not directly proven, but is matter of in- ference, the existence of a guilty motive* or purpose may be material to establish the scienter. Id. To render the trustees personally liable under this section, it must appear that they have signed the report with knowledge that it contained a materially false representation, and that it was mpde in bad faith or for some fraudulent purpose. Whitaker v. Masterton, 21 W. Dig., 209 ; Bonnell v. Griswold, 80 N. Y., 128 ; Pier v. Hanmore, ante; 13onnell v. Griswold, 89 id., 122. See Glen's P. P. Co. v. White, 18 Hun, 214 ; Wickens v. Foster, 22 W. Dig , 4'J6. A finding that a trustee signed the annual report in bad faith, with knowledge of its falsity, was held, in Blake v. Griswold, 103 N. Y., 429, to be justified by the facts. If a trustee acts honestly and in good faith in making the statement, believing it to be true, this will exonerate him from liability under this section. Taylor t>. Thompson, 66 How., 102 ; Lake Sup. I. Co.- v. Drexel, 90 N. Y., 87. In an action under this section, an allegation in the complaint that the trustee knew the report to be false when he signed it, is sufficient. Taylor v. Thompson. 66 How., 102. False statement in annual report of corporation as to capital paid in, not affect- ing judgment or conduct of persons dealing with it, is not material false statement, rendering officers signing report liable for its debts. Walton v. Goodwin, 68 Hun, 87. In an action against a trustee to charge him with liability under this section, a judgment, recovered against the corporation is neither conclusive, nor primafacit evidence of the debt. Torbett v. Goodwin, 62 Hun, 407 ; 41 N. Y. St. Rep., 323; 87 Abb. N. C., 444. Judgment against company is not conclusive in action against director. Brand t). Goodwin, 24 N. Y. St. Rep., 305. In action against trustees for not filing report, stock transfer book is evidence of transfers of stock and dates thereof. Kraft v. Coykendall, 26 N. Y. St. Rep., 79. An assignee of a claim against the corporation may maintain an action against a trustee thereof under this section. Pier v. George, 86 N. Y., 613. The penalty is recoverable by an assignee of the claim, it seems, though not by a legal representative of a deceased claimant. Torbett v. Godwin, 62 Hun, 407 ; 27 Abb. N. C., 444. The liability created by this section abates on the death of the original creditor of the corporation and can not be revived in favor of, or prosecuted by, his per- sonal representatives. Boyle v. Thurber, 50 Hun, 259 ; Brtckett v. Griswold, 1( N. Y., 425 ; Blake v. Same, 104 id., 613. The action under this section abates upon the death of either party. Blake t>. Griswold, 104 N. Y.. 613. But it does not abate in case the plaintiff dies afte rendition of the judgment. Id. In such case, the personal representatives are entitled to be substituted in his place. Id. The death of the creditor, pending an action against the trustees under this ection terminates the action. Brackett v. Griswold, 103 N. Y., 425. The action does not survive to hia personal representatives. Id. Blake . Gmwold,. 104 W. Y., 616 ; Whitaker v. Masterton, 104 id., 280 ; Hegerich v. Keddie, 99 id., 258. fc far as the action i for a conspiracy to cheat or defraud, it involves an injury & property righto and narmes. Brackett v. Griswold, ant*. 39 STOCK CORPORATION LAW. In an action under this section it is no defense to such a liability that the director is also a creditor of the company. Richards v. Croker, 19 Abb. N. C., 73. A recovery on the ground of the falsity of a report made can not be had upon the allegation of an omission to make and file any report. Whitney Arms Co. v. Barlow, 68 N. Y., 34. The penalty, imposed by this section, is not incurred simply because of an omis- sion of certain liabilities of the company from the aggregate of indebtedness, I hough this was known to the trustees at the time the report was made. Butler t>. bmalley, 101 N. Y., 71. A mere statement by a trustee to a fellow-trustee, that he will have no more to Jo with the company, can not be construed as a resignation. Kuidberg t>. Mudgett, 84 W. Dig., 229. To have such effect, his intention to give up the office should b expressed distinctly and brought home to the corporation. Id. An action under this section is local and must be tried in the county where the cause of action, or some part thereof, arose. Veeder v. Baker, 80 N. Y., 156. Such cause of action arises in the county where the report was made and filed, though the debt against the company may have originated in another county. Id. It is held in Hutchinson v. Young, 180 App. Div., 246, that this section is not penal. 32. Alterations or extension of business Any stock cor- poration heretofore or hereafter organized under any general or sdecial law of this state may alter its certificate of incorporation so as to include therein any purposes, powers or provisions which at the time ot such alteration may apply to corporations engaged in. a business of the same general character, or which might be included in the certificate of incorporation of a corporation organized under any general law of this state for a business of the same general character, by filing in the manner provided for the original certificate of incor- poration an amended certificate, executed by the president and secretary, stating the alteration proposed, and that the s>ame has been duly authorized by a vote of a majority of tLe 'directors and also by vote* of stockholders representing at least three- fifths of the capital stock* at a meeting of the stockholders called for the purpose in the manner provided in section forty-five of this chap- ter, and a copy of the proceedings of such meeting, verified by the affidavit of one of the directors present thereat, shall be filed with such amended certificate. Amended by ch. 354 of 1901. In effect April 16, 1901. Amended by ch. 755 of Laws 1905. 33. Sale of franchise and property. A stock corporation, except a railroad corporation and except as otherwise provided by law, with the consent of two-thirds of its stock, may sell and convey its property, rights, privileges and franchises, or any interest therein or any part thereof to a domestic corporation, engaged in a business of the same general character, or which might be included in the certificate of incorporation of a corporation organizing under any general law of this state for a business of the same general character, and a domestic corporation the principal business of which is carried on in, and the principal tangible property of which is located within a state adjoining the state of New York, may with the consent of the holders of ninety- five per centum of its capital stock, sell and convey its property situate STOCK CORPOKATION LAW. without the state of New York, not including its franchises to a corpo- ration organized under the laws of such adjoining state, and such sale and conveyance shall, in case of a sale to a domestic corporation, vest the rights, property and franchises thereby transferred, and in case of a sale to a foreign corporation the property sold in the corporation to which they are conveyed for the term of its corporate existence, subject to the provisions and restrictions applicable to the corporation conveying them. Before such sale or conveyance shall be made such consent shall be obtained at a meeting of the stockholders called upon like notice as that required for an annual meeting. If any stockholder not voting in favor of such proposed sale or conveyance shall at such meeting, or within twenty days thereafter object to such sale, and demand payment for his stock, he may, within sixty days after such meeting, apply to the supreme court at any special term thereof held in the district in which the principal place of business of such corpora- tion is situated, upon eight days' notice to the corporation, for the appointment of three persons to appraise the value of such stock, and the court shall appoint three such appraisers, and designate the time and place of their proceedings as shall be deemed proper, and also direct the manner in which payment for such stock shall be made to such stockholders. The court may fill any vacancy in the board of appraisers occurring by refusal or neglect to serve or otherwise. The appraisers shall meet at the time and place designated, and they or any two of them, after being duly sworn honestly and faithfully to discharge their duties, shall estimate and certify the value of such stock at the time of such dissent, and deliver one copy to such corpo- ration, and another to such stockholder, if demanded; the charg'es and expenses of the appraisers shall be paid by the corporation. When the corporation shall have paid the amount of such appraisal, as directed by the court, such stockholders shall cease to have any interest in such stock and in the corporate property of such corporation and such stock may be held or disposed of by such corporation. Amended by ch. 130 of 1901. In effect March 20, 1901. 34. No director or officer of any stock corporation shall be liable to any creditor of the corporation, because of the creation of any ex- cessive indebtedness, or because of any failure to make or to file aii annual report, whether heretofore or hereafter occurring; (1) In case of any debt, as to which personal liability of directors or officers may be or shall have been waived by such creditor, or by anyone under whom he claims ; or by any provision of any instru- ment creating or securing such debt : or (2) Unless within three years after the occurrence of the act or the default in respect of which it shall be sought to charge the director or officer, such creditor shall have served upon such director or offi- 408 STOCK CORPORATION LAW. cer written notice of his intention to hold him personally liable foi his claim ; provided, nevertheless, that any snch liability, because of any such default now existing and not waived as above provided, may be enforced by action begun at any time within the year eigh- teen hundred and ninety-nine or by action begun thereafter, if within such year written notice of intention to enforce such liability shall have been given as above provided. Any director or officer, who, because of any such existing or future liability, shall pay any debt of the corporation, shall be subrogated to all rights of the creditor in respect thereof against the corporate property, bn* not against the stockholders of the corporation; and also shall be entitled to contribution from all other directors and officers of the corporation similarly liable for the same debt, and the personal representatives of any such direc* >r or officer who shall have died before making such contribution. Added by eh. 864 of IBM. ARTICLE III. STOCK; STOCKHOLDERS, THKIR RIGHTS AND LIABILITIES. 40. Is 1 ue and transfers of stock. 41. Subscriptions to stock. 42. Consideration for issue of stock and bonds. 48. Time of payment of subscriptions to stock. 44. Increase or reduction of capital stock. 46. Notice of meeting to increase or reduce capital stock. 4*. Conduct of such meeting; certificate of increase or reduction. 47. Preferred and common stock. 48. Prohibited transfers to officers or stockholders 48. Payment by stockholders of mortgage debt pending foreclosure 60. Application to court to order issue of new in place of lost certificate of 61. Order of court upon such application. 52. Financial statement to stockholders. 63. Exhibition of books by transfer agent of foreign corporation. 64. Liabilities of itockholders. 66. Limitation of stockholder's liability. 66. ImcreaAe or reduction of number of share*. 67. Voluntary dissolution. 86. Merger. 59. Change of place of 'business. 60. Liability of officers, directors and stockholders of foreign corporations. 61. Dissolution by in corporators. 62. Partly paid stock. | 40. Issue and transfers of stock. The stock of every stock corporation shall be represented by certificates prepared by the di- rectors and signed by the president or vice-president and secretary or treasurer and sealed with thu seal of the corporation, and shall be transferable in the manner prescribed in this chapter and in the by- laws. No share shall be transferable until all previous calls thereon tliall have been fully paid in. 40b STOCK CORPORATION LAW. Any stock corporation, domestic or foreign, now existing or hereafter organized, except monied corporations, may purchase, acquire, hold an3 dispose of the stocks, bonds and other evidences of indebtedness of any corporation, domestic or foreign, and issue in exchange therefor its stock, bonds or other obligations if authorized so to do by a pro- vision in the certificate of incorporation of such stock corporation, or in any certificate amendatory thereof or supplementary thereto, filed in pursuance of law, or if the corporation whose stock is so purchased, acquired, held or disposed of, is engaged in a business similar to that of such stock corporation, or engaged in the manufacture, use or sale of tihe property, or in the construction or operation of works necessary or useful in the business of such stock corporation, or in which or in connection with which the manufactured articles, product or property of such stock corporation are or may be used, or is a corporation with which such stock corporation is or may be authorized to consolidate. When any such corporation shall be a stockholder in any other corporation, as herein provided, its president or other officers shall be eligible to the office of director of sudh corporation, the same as if they were indi- vidually stockholders therein and the corporation holding such stock shall possess and exercise in respect thereof, all the rights, powers and privileges of individual owners or holders of such stock. Any stock corporation may, in pursuance of a unanimous .vote of its stockholders voting at a special meeting called for that purpose by notice in writing signed by a majority of the directors of such corporation stating the time and place and object of the meeting, and served upon each stockholder appearing as such upon the books of the corporation, personally or by mail at his last known post-office address at least sixty days prior to such meeting, guarantee the bonds of any other domestic corporation engaged in the same general line of business ; and any stock corporation owning the entire capital stock of any other domestic stock corporation engaged in the same general line of busi- ness may in pursuance of a two-thirds vote of its stockholders voting at a special meeting called for that purpose by notice in writing signed by a majority of the directors of such corporation, stating the time and place and object of the meeting and served upon each stockholder appearing as such upon the books of the corporation personally, or by mail, at his last known post-office, at least sixty days prior to such meeting, guarantee the bonds of such other corporation. Former section 40 amended. Amended by ch. 601 of 1902. In effect April 15, 1902. See section 7, chap. 67 of 1811; section 8, chap. 40 of 1848, and section 12. chap. 641 of 1875, now repealed. The capital stock is the money contributed by the corporators to the capital, and is usually represented by shares issued to the subscribers to the stock on the initiation of the corporate enterprise. Christensen Eno, 106 N. Y. 97; Burrall Bushwick E. B. Co., 75 id. 211. 41 STOCK CORPORATION LAW* A person who subscribes regularly to the stock of a corporation become* * stockholder in virtue of his subscription, and especially so after he has paid a portion of his subscription. Spear . Crawford, 14 Wend., 20; Lathrop . Knee- land, 4(5 Barb., 432. Where the whole capital stock has been subscribed for and taken at the time the articles of incorporation were filed, no person, by merely writing his name in the corporation book and affixing a number of shares opposite thereto, can acquire a right to any shares of stock, or become, by such act, a stockholder of the cor- poration, and as such liable for its debts. Lathrop v. Eneeland, ante. In such case, no person can become a stockholder, except by purchase from an original subscriber, or his assignee, and by assignment of stock. Id. A subscription to the certificate of incorporation only by placing opposite to his signature the number of shares taken by him, is sufficient as a subscription. Phoenix W. Co. . Badger, 6 Hun, 293; affd 67 N. Y., 294 ; Buffalo, etc., Co. v. Dudley, 14 id., 336 ; Lake Ontario, etc., Co. v. Mason, 16 id., 461 ; Dayton v. Borst, 81 id., 435 note. The payment for stock, and the right to receive the certificates therefor, make the subscriber or purchaser a stockholder in the corporation, to the extent of th stock he is entitled to receive. De Caumont v. Bogart, 36 Hun, 382 ; Rutter t>. Kilpatrick, 63 N. Y., 606. He is in a position to assign his right to receive the cer tificate. Id.; Robinson v. National Bk., etc., 95 N. Y., 637. The effect of a certificate of unpaid stock in a corporation, created for the private benefit of its projectors, is to give the holder a title conditional upon his making further payments, if called, but leaves such payments optional with him. Seymour v. Sturgess, 26 N. Y., 134. Stock certificates executed, though not detached, are sufficiently issued. Hal* stead v. Dodge, 51 Supr., 169. Any contract of subscription, good and valid at common law, is still valid, not- withstanding this section. Buffalo & J. R. R. Co. v. Gifford, 87 N. Y., 294. A call for payment, is sufficient notice that a sufficient amount of stock has beti subscribed. Harlem C. Co. v. Seixas, 2 Hall, 504. The unissued shares of a corporation are not assets. Christensen v. Eno, ante. The right to sell shares is a personal one, to be enjoyed and exercised in severally by the stockholders of a corporation. Campbell v. American Zylonite Co., 122 N. Y., 455. Certificates may be transferred in blank, and the holder may fill in his name. Com. Bk. v. Kortright, 22 Wend., 848; Leavitt v. Fisher, 4 Duer, 1. The liability of a shareholder to pay for stock does not arise out of his relation. Christensen v. Eno, ante. It depends upon his contract, express or implied, or upon some statute. Id. In the absence of either of these grounds of liability, a person to whom shares have been issued as a gratuity, has not, by accepting them, committed any wrong upon creditors, or made himself liable to pay the nominal face of the shares as upon a subscription or contract. Id.; Seymour v. Sturgess, ante. Presence of the first election, election as a director thereat, and acting as a member of the board will estop a subscriber from objecting, in an action against him by the company, to the validity of its organization, on the ground that no notice of such election was given, and that some of the subscribers did not 'attend. Schenectady, etc., Co. v. Thatcher, 11 N. Y., 102 ; see also, Phoenix W. Co. t>. Badger, 6 Hun, 293 ; Buffalo, etc., Co. v. Cary, 26 N. Y., 75 ; Don-is v. French, 4 Hun, 292; White v. Coventry, 29 Barb., 305; Cooper v. Shaver, 41 id., 151 ; Knowlton v. Congress, etc., E. S. Co., 57 N. Y., 331. A corporation can not purchase or deal in stocks of other corporations, unless expressly authorized by law so to do. Holmes & G. Mfg. Co. t>. Holmes & W. M. Co., 127 N. Y., 352; 38 N. Y. St. Rep., 155 ; Talmagev. Pell, 7 N. Y., 328; Berry v. Yates, 24 Barb., 200 ; Milbank v. N. Y., L. E. & W. R. Co., 64 How., 20 ; Mechanics' M. S. Bk. v. Meriden A. Co., 24 Conn., 159 ; Central R. R. Co. . Penn. R. R. Co., 31 N. J. Eq. 475; Hazlehurst . Savannah R. R. Co., 43 Ga., 67 ; Valley R. R. Co. v. Lake Erie I. Co., 18 N. E. Rep. 486 ; People v. Chicago G. T. Co., 130 111., 268; Franklin Co. v. Lewiston Inst., 68 Me. 43 ; Hill . Nesbet, 100 Ind., 341. But it may take title to all kinds of property, even the stock of another company, in the payment of a debt. Id.; Kent v. Quicksilver M. Co., 78 N. Y., 159; Treadwell v. S. M. Co., 7 Gray, 393; Howe 73. Boston C. Co., 16 id., 493; Hodges v. N. E. S. Co., 1 R. L, 312; State v. Western I. C. Co., 40 Kan., 9; Leathers v. Janney, 41 La. Ann., 1120 ; Hibemia Ins. Co. v. St. Louis, etc., 18 Fed. Rep., 516 ; Taylor v. North 8. G. M. Co., 79 Cal., 286 ; Miners' D. Co. . Eellerbach, 37 id., 643; State t> Butler, 86 Tsnn., 614; Palmer . Cypreiw H. 0m., 122 N. T., 439. 43 STOCK CORPORATION LAW Stockholder iu corporation has an insurable interest in corporate property Riggs v. Com. Ins. Co., 125 N. Y., 7. Decedent assigned certificate to third person whom executor sued to compel re-assignment on ground of fraud. Third party's sister appeared as witnese. Afterwards third party assigned to his sister; in action of interpleader held that judgment-roll was admissible on question of good faith of sister in taking assign- ment. Pfg Tel.. Trans. Co. v. Brantingham, 77 App. Div. 280. 41. Subscriptions to stock. If the whole capital stock shall not have been subscribed at the time of filing the certificate of incorpora- tion, the directors named in the certificate may open books of subscrip- tion to fill up the capital stock in such places, and after giving such notices as they may deem expedient, and may continue -to receive sub- scriptions until the whole capital stock is subscribed. At the time of subscribing, every subscriber, whose subscription is payable in money, shall pay to the directors ten per centum upon the amount subscribed by him in cash, and no such subscription shall be received or taken without such payment. Former section 41 amended. See section 5, chap. 611 of 1875, now repealed. This section does not point out how, or where the books of subscription shall be opened, or what kind of books shall be used. Buffalo & J. R. R. Co. i>. Gifford, 87 N. Y., 294. Every purpose of the statute is satisfied, if the directors adopt a book which some one else has provided. Id. A subscription of the whole amount of stock is never held a condition precedent to a legal corporate existence, except when it is made so by the act of incorpora- tion. Schenectady, etc., Co. v. Thatcher, 11 N. Y., 102. The directors have authority to require payment of subscriptions for stock before the whole capital is subscribed. Id. In actions upon unpaid subscriptions for stock, and against assignees of stock not fully paid for, courts have respect to the terms of the contract and certificate, and the circumstances of the case. Seymour v. Sturges, 26 N. Y., 141 ; Billings V. Robinson, 94 id., 415. Each subscription constitutes a separate and independent agreement, and, in the absence of proof, there can be no presumption that a person was induced to sub- scribe because another had done so. Whittlesey v. Frantz, 74 N. Y., 456. In the absence of statutory restriction, a corporation has power to receive pay- ment otherwise than in money for a subscription to its capital stock. Williams v. W. U. T. Co., 9 Abb. N. C., 437; East N. Y., etc., R. R. Co. v. Lighthall, 5 Abb., N. S., 458 ; Barry v. Mer. Ex. Co., 1 Sandf. Ch., 280 ; De Groff v. Am. L. I. Co , 21 N. Y., 124. The language employed in the enactment of this section can be satisfied only by a payment in cash or its actual equivalent. Excelsior G. B. Co. v. Stayner, 25 linn, 91; 61 How., 456; 12 W. Dig., 536. In no proper sense can the unpaid or uncertified check of the subscriber be accepted or regarded as cash. Id. 8*e Durant v. Abendroth, 69 N. Y., 148 ; Beach v. Smith, 30 id., 116. If the payment is not so made, the party can not become a subscriber. Excelsior G. B. Co. v. Stayner, ante. He can not acquire in any other way aright to the stock, nor can the formal terms of the contract, made for the payment of its price, be enforced against him. Id. The next section (42) renders void all stock issued in violation of its provisions. See Jenkins v. Union Turnpike Co. 1 Caine's Cases, 86 ; President, etc., Hurtiss, 9 Johns., 217; Same v. McKean, 11 id., 98; Rensselaer, etc., Co. v. Barton, 16 N. Y., 457 note ; Black River, etc., Co. v. Clarke, 25 id., 208. The subscription and the payment of the ten per cent, must both concur to make a valid subscription. Excelsior G. B. Co. v. Stayner, ante. Actual pay- ment at any period after subscription, with intent to effectuate and complete it, will satisfy the statute. Id. A subscription unaccompanied by the required ten per cent, is void under this section. Perry v. Hoadlev, 19 Abb. N. C.. 76. In the absence of the provisions that nothing but cash shall be considered ail payment of capital, and that, if stock is issued for property, it must be so speci- fied, a areneral statement that so much capital had been paid in would not, in cotn- 43 STOCK CORPORATION LAW. mon parlance, be very far from correct, even though the capital had not been all paid in cash. Pier v. Hanmore, 86 N. Y., 95. The former law contained these provisions, but the present act has omitted them. Where a corporation procures an alteration to be made in it charter by which a new and different business is superadded to that originally contemplated, such t f the stockholders as do not assent to the alteration will be absolved from liability on their subscriptions to the capital stock. Hartford & N. H. R. R. Co., 6 Hilt 3S3. Especially if the alteration is one plainly prejudicial to their interests. Id. Subscriber to capital stock is not entitled to certificate, until full payment, nor (i receive certificate of consolidated stock in exchange therefor. Babcock . Schuylkill v. L..V. R. R. Co., 39 N. Y. St. Rep., 506. Complaint in action on agreement. Knickerbocker Trust Co. v. Hard, 67 App. Div. 46i5. .Subscription cannot be enforced where prospectus differs from certificate of incorp >ration. Stern v. ~McK.ee, 70 App. Div. 143. . Railway corporation authorized to issue preferred stock without conditions. May make suca conditions as it chooses. Uackett . N. P. R. Co., 36 Misc. 583. Subscriber not mentioned in certificate liable when demand made shortly after organization. Woods M. V. Co., v. Brody. 39 Misc., 79. Plaintiff relying on representations of facts, not merely opinions, which were untrue, can rescind his subscription and recover the amount paid thereon. Mu'.-k ?'. Latta, 83 App. Div., 242. When directors are not necessary parties in action to rescind, etc. Mack v. Latta, 83 App. Div., 212. 42. Consideration for issue of stock and boads. No corporation shall issue either stock or bonds except for money, labor done or property actually received for the use and lawful purposes of such corporation. Any corporation m-iy purchase any property authorized by its certificate of incorporation, or nec- t'or the use and lawful purposes of such corporation, and may issue stock to the amount of the value thereof in payment therefor, and the stock so issued shall be full paid stock and not liable to any further c.ill, neither shall the holder thereof be liable t\>r any further payment under any of the provisions of this act ; and in the absence of fr.iud in the transact!. m the judgment of the directors as to the value of the property purchased shall be conclusive ; aud in all state- ments and reports of the corporation, by law requireil to be published or tiled, this stock shall n->t be stated or reported as being issued for cash paid to the corporation, but shall be reported as issued for property purchased. Amended by ch. 354 of 1901, In effect April 1C, 1901. Former section 42 amended. section 14, chap. 40 of 1848, and section 14, chap. Oil of 1875, now repealed. The company can not issue its stock as full paid at anything less than par value. Gra'.nUe v. Queens Co. W. Co., 123 N. Y., 93. The amount of the nominal or ptu value of the stock must be put against the value of the property purchased. Id This, section contemplates clearly that only the amount of the stock as named in the scrip is" to be issued to the amount of the value of the property, and is there to be regarded as full paid stock. Id. The fair value contemplated by this section is that of the property at the time of the sale. Huntingtonw. Attrill, 118 N. Y., 365 ; Hatch v. Same, id., 383. Thiscon- Btifules the consideration, upon which the subscription to the capita.! stock of the company, is satisfied. Id. When directors have power to issue stock for accounts. Gurney v. W. T. & 8. Co., 57 Supi-., 444. The application upon hia stock of an account for services rendered in construct- in','- furnaces for the company by a subscriber for original stock, is a payment in y the meaning of this section. Veeder v. Mudgett, 95 N. Y., 295. .i^iiitioii may ...sue stock for portion of pu:eh:ise price, and may pay In >r issue bonds for balance. Gamble <. QUC.'M, 0. W. Co., ante. kliolders to whom full paid stock was issued tor less than par only liable to amount he agreed to pay. Thompson . Knight 74 App. Div. 316. $ 43. Time of payment of subscriptions to stock. Subscriptions to the capital stock of a corporation shall be paid at such times and in such install- ments as the board of directors may by resolution require. If default shall be made in the payment of any installment as required by such resolution, the board may declare the stock aud all previous payments thereon forfeited for the use of the corporation, after the expiration of sixty days from the service on the defaulting stockholder, personally or by mail directed to him at his last known postoffice address, of a written notice requiring him to make payment within sixty days from the service of the notice at a place specified therein, and stating that, In case of failure to do so, his stock and all previous payments thereon wiU be forfeited for the use of the corporation. 44 STOCK CORPORATION LAW. Such stock, if forfeited, may be reissued or subscriptions therefor may be received as in the case of stock not issued or subscribed for. If not sold for its par value or subscribed for within six months after such forfeiture, it shall be canceled and deducted from the amount of the capital stock. If by such cancellation the amount of the capital stock is reduced below the minimum required by law, the capital stock shall be increased to the required amount within theree months thereafter or an action may be brought or proceedings instituted to close up the business of the corporation as is the case of an insolvent corporation. If a receiver of the assets of the corporation has been appointed, all un- paid subscriptions to the stock shall be paid at such times and in such installments as the receiver or the court may direct. Former section 43 amended. See section 5, chap. 67 of 1811, section 6, chap. 40 of 1848, section 11, chap. 611 of 1875, and section 1, chap. 102 of 1883, now repealed. The corporation, when formed, may enforce payment of the subscriptions to its capital stock against persons who subscribe its articles of association before the corporate body has a legal existence. Don-is v. French, 4 Hun, 292 ; Buff., etc., R. R. Co., v. Hatch, 20 N. Y., 161 ; Burr v. Wilcox, 22 id., 551 ; Strong v. Wheaton, 38 Barb., 616. When payment of subscriptions to be made. Williams v. Taylor, 120 N. Y., 244; L. 0. A. & N. Y. R. R. Co. v. Mason, 16 id., 451 ; White v. Haight, id., 310; Howland v. Edmonds, 24 id., 307; Tuckerman v. Brown, 33 id., 297. The power of the directors to forfeit the stock in the manner prescribed in this section is clearly given, and is to be exercised at their discretion. Mills v. Stewart, 62 Barb., 444 aff 'd 41 N. Y., 384. The only limitation on this power is that it is done in the manner prescribed and in good faith. Id. The right of the creditor to sue a stockholder for the amount of his unpaid stock is not independent of, but subordinate to, the right of the directors to compromise the claim or to forfeit the stock. Id. After such forfeiture in good faith, the holder of unpaid stock ceases to be a stockholder and liable as such to any creditor of the corporation by reason of such unpaid installment on his stock. Id. A fraudulent forfeiture is void as to creditors, and the stockholder liable notwithstanding. Id. The right of the company to make a demand for the unpaid balances due upon the stock is limited to stockholders as such. Billings y. Robinson, 28 Hun, 122. Many and onerous obligations are, by the statute, imposed upon stockholders, which are not imposed upon mere subscribers for stock who have not received certificates therefor, ante. A subscription to the articles of incorporation, with a statement of the number of shares opposite the name, is a sufficient and binding subscription for the stock, and takes effect upon the filing of the certificate. Phoenix W. Co. v. Badger, 67 N. Y., 294; Buffalo, etc., Co. v. Dudley, 14 id., 336 ; Lake Ontario, etc., R. R. Co. v. Mason, I*! id., 451 ; Dayton v. Borst, 31 id., 435. When stock certificates have been delivered to the subscriber for the stock, he becomes a member of the company, entitled to all right and privileges incident to the relation, and the original promise is merged in the new obligation. Billings v. Robinson, ante. Persons, who sign the articles of association of a manufacturing company, are stockholders. Strong v. Wheaton, 38 Barb., 616. When the holding of stock is once established, it must be presumed to continue until its surrender or assign- ment is shown. Id. One, to whom stock has been apportioned in a corporation, is a stockholder, though no certificate has been issued. Burr v. Wilcox, 22 N. Y., 551. This is the case, even though the apportionment was made for him to an agent, who subscribed at his request. Id. The members, as soon as the corporation has any property or valuable franchise, become stockholders in proportion to their respective in terests. Id. An agreement to take stock in a corporation to be thereafter formed become* binding on the organization of the corporation and its acceptance of the agreement. Buffalo & J. R. R. Co. v. Clark, 22 Hun, 359 ; aff'd 87 N. Y., 294 ; Stanton . Wilson, 2 Hill, 153 ; Ref. Bo. D. Ch. v. Brown, 29 Barb., 335 ; Buffalo & N. Y. C. R. R, Co. v. Dudley, 14 N. Y., 336 ; Buffalo & P. R. R. Co. t>. Hatch, 20 id., 157. 45 STOCK CORPORATION LAW. Where a person, after his subscription and after the company is fully organized recognizes the existence of the contract by making payments upon the shares as called for by the company, and_receiving a certificate for such shares, a legal lia- bility on his part is created to pay the full amount of his subscription as called fo* by the company. Billings?). Robinson, ante; Phoenix W. Co. v. Badger, 67 N. Y., 294 ; Dayton v. Borst, 31 id., 435. This liability continues until the company releases or surrenders up its right of action. Id. Payment of the calls made upon the capital stock under this section may be enforced by an action upon the undertaking of the stockholder, notwithstanding this section authorizes a forfeiture of the stock in case of non-payment. Troy & B. R. R. Co. v. Tibbetts, 18 Barb., 297 ; Ogdensburg, R. & C. R. R. Co. v. Frost, 21 id., 541 ; Northern R. R. Co. v. Miller, 10 id., 269. The remedy by forfeiture of stock on non-payment of calls is merely cumulative, and does not deprive the company of its remedy by action on the assumpsit. Buffalo & N. Y. C. R. R. Co. v. Dudley, 14 N. Y., 336 ; Northern R. R. Co. . Miller, 10 Barb., 260 ; Mann v. Currie, 2 Barb., 294. The right of an incorporated company to enfore a forfeiture of stock, and all previous payments, upon the failure of a stockholder to meet the calls made by the company, will not prevent such company, or the receiver thereof, from col- lecting the balance due upon any share of its stock. Mann v. Currie, 2 Barb., 294. The rule is the same, whether the stock is held by an original stockholder or by an assignee. Id. The latter, by the transfer, adopts the contract of his assignor with the company, and becomes substituted in his place both as regards his rights and his liabilities. Id. It was held in Rensselaer, etc., v. Barton, 16 N. Y., 457, that an agreement to take stock imports a promise to pay for it. But in Seymour v. Sturgess, 26 N. Y., 134, the court held that no contract to pay for the stock can be implied from the mere purchase. The effect of the purchase is to acquire a title conditional upon making the remaining payments, but leaves such payments optional with the pur- chaser. Id. It is only where there is an express agreement to pay that an action will lie by the corporation. Id. But if there is no such agreement, the sole remedy for the corporation is by a sale of the shares of the delinquent members. Id.; Wintringham v. Rosenthal, 25 Hun, 580. A failure to pay calls when due, not only divests the holder of his title and interest in the shares, but vests his interest in the corporation and remaining stockholders. Weeks v. Silver Islet, etc., Co., 54 Supn., 1. The interests of the latter become enhanced in value by the addition of the shares which the delin- quent stockholder has lost. Id. Such right can not be divested upon the delinquent stockholder's willingness to pay the calls after considerable time has been afforded him to do so, and his laches and delay have caused the corporation and non-delin- quent stockholders to treat his stock as forfeited. Id. Such action may be brought upon the original subscription. Phoenix W. Co. . Badger, 67 N. Y., 294. It is not necessary to aver calls, at least after the lapse of two years from the time of incorporation. Id.; Rensselaer, etc., Co. v. Barton, 16 N. Y., 457 note; Lake Ontario, etc., R. R. Co. v. Mason, id., 451. The interest acquired, on the incorporation of the company, by a subscriber to its stock is a good consideration to support his implied promise to pay for such stock. Buffalo & N. Y. C. R. R. Co. v. Dudley, 14 N. Y., 336. A corporation, after it has forfeited the stock of a subscriber for non-payment of an installment due upon his subscription, can not maintain an action to recover any part of such subscription. Small v. Herkimer Mfg. Co., 2 N. Y., 330. The exaction of the forfeiture operates as a rescission or satisfaction of the contract. Id. Nor can the stockholder, in such case, recover any surplus. Id. For interest of defaulting shareholder, and the rights of the corporation, in the forfeited shares, see Weeks v. Silver Islet C. M. & L. Co., 8 N. Y. St. Rep., 110. Such shares become vested in the other stockholders. Id. They can not be deprived of such interest without their consent or due process of law. Id. When court of equity will not relieve from effect of forfeiture. Id. The liability of a stockholder of a corporation for the amount unpaid on stock owned by him, can be enforced only by a creditor. Tucker v. Oilman, 45 Hun, 193. It can not be enforced by a receiver. Id.; Farnsworth v. Wood, 91 N. Y., 808 ; Mann v. Pentz, 3 id., 415. Where the stock is transferred on the books to a person who appears to b the legal owner, such person is liable, though it is held by him as collateral security tor * debt. Rosevelt v. Brown, 11 N. Y., 148 ; Cutting v. Damerel, 88 N. Y., 410. 46 STOCK CORPORATION LAW. Where transfer of stock ia made with due observance of the condition* of the sections regulating the mode and manner of transfer, and is entered into in good faith, the liability to pay future calls ceases, and the obligation to pay unpaid balances is shifted from the assignor to the assignee. Billings t>. Robinson, ante. Where the assignee ef the share of stock is, under the statute, liable for the balance unpaid thereon, and the company has assented to the transfer by entering It upon its books, it has thereby released the assignor from the liability imposed upon him by the original subscription papers, and can not, nor can its receiver, maintain an action to enforce the same against him. Billings v. Robinson, ante. A receiver occupies no other position, and has no better right than the corpora- tion. Cutting v. Damerel, 88 N. Y., 410. A receiver can not maintain an action against one who was formerly a stock- holder of the corporation, to collect the amount unpaid upon the shares of stock gold and transferred by him, unless the corporation itself could have maintained such an action, if it had been brought prior to the time when the receiver was appointed. Billings -u. Robinson, ante. An action under this section, may be continued by a receiver, subsequently appointed, in the name of the original party. Phoenix W. Co. v. Badger, 67 N. Y., 294; Rankine v. Elliott, 16 id., 377 ; Tracy v. First Nat. Bk., 87 id., 623. An alteration by the legislature of the company's charter, in pursuance of power* reserved, does not discharge a stockholder from liability on his subscription, where it is duly made and without any fraud on the part of the company. Buffalo & N. Y. C. R. R. Co. v. Dudley, 14 N. Y., 336. A subscriber to the capital stock of a corporation, who has failed to pay for the shares subscribed for, as required by the ' terms of his subscription, is properly chargeable with interest from the time of the default. Gould v. Town of Oneonta, 71 N. Y., 298. He can not compel the company to issue the stock, until not only the principal, but the interest, is paid. Id. Subscriptions, based on issue of capital stock at less than par value, are not en- forceable. Zel. M. Co. v. Meyer, 28 N. Y. St. Rep., 759. Subscriber's knowledge does not aid enforcement. Id. Owners of fully paid up stock are entitle to enjoin corporation from declaring forfeiture of their stock. Moore v. N. J. L. Co., 57 Supr., 1. A judgment creditor of the corporation will be restrained from prosecuting an action against a stockholder for the amount of his unpaid subscription to its capital, where such action is commenced after the making of an order of sequestra- tion, though before the appointment of the receiver under it is perfected. Ran- kine v. Elliott, 16 N. Y., 380. Fraud of corporation will relieve subscriber to stock, on prompt rescission, be- fore any equities intervene. McDermott v. Harrison (Sup. Ct. 1890), 30, 324 ; 80 K. Y. St. Rep., 324. When action to recover against stockholder amount unpaid on stock, can not bt .Maintained. Christenson v. Quintai-d, 29 N. Y. St. Rep., 61. 44. Increase or reduction of oapit 1 stock. Any domestic cor- poration may increase or reduce its capital stock in the manner herein pro- vided, but not above the maximum or below the minimum, if any, prescribed by general law governing corporations formed for similar purposes. If increased, the holders of the additional stock issued shall be subject to the same liabili- ties with respect thereto as are provided by law in relation to the original capital ; if reduced, the amount of its debts and liabilities shall not exceed the amount of its reduced capital, unless an insurance corporation, in which case the amount of its debts and liabilities shall not exceed the amount of its reduced capital and other assets. The owner of any stock shall not be relieved from any liability existing prior to the reduction of the capital stock of any stock corpora- tion. If a banking corporation, whether the capital be increased or reduced, its assets shall at least be equal to its debts and liabilities and the capital stock, as increased or reduced. A domestic railroad corporation may increase or reduce its capital stock in the manner herein provided, notwithstanding any provision con- tained herein, or in any general or special law fixing or limiting the amount of capital stock which may be issued by it. Amended by ch. 354 of 1901. In effect April 16, 1901. 47 STOCK CORPORATION LAW. 611 of 1876 ; Motion 1, chap. 264 of 1878, and section 2, chap. 397 of 1884, now repealed. In the absence of evidence to the contrary, a corporation will be presumed to have acted, in increasing its stock, in conformity with its corporate powers and its articles of association. Williams v. W. N. T. Co., 9 Abb. N. C. 437 ; Chautauqua Co. Bk. v. Riskey, 19 N. Y. 369; De Groff v. Am. L. T. Co., 21 id., 124. The i ight to grant or withhold assent to change the relative value of the share* of stock belongs to their owners as individuals, to be enjoyed and exercised by by them in severally. Campbell v. American Zylonite Co.. 122 N. Y., 464. Fixing the amount of capital stock. Sutherland v. Olcott, 29 Hun, 161. A corporation has no implied authority to increase or diminish its capital stock. Sutherland v. Olcott, 95 N. Y., 93; Salem M. D. Corp. v. Ropes, 6 Pick., 23. It can do so on when and so authorized by statute. Id. A corporation can not increase its capital stock at will, in any manner, or to any extent, unless authorized to do so by its charter, and then only in the manner prescribed. Lathrop v. Kneeland, 46 Barb., 432. This section is intended to apply not only to corporations which have an actual, but also to those which have no market value. People ex rel. Eden M. A. Co. v. Carr, 36 Hun, 488. If the stock is valueless, then clearly its market value is lee* than par. Id. Where it is a stock which is seldom bought or sold, the comptroller can ascertain to his satisfaction its actual market value sufficiently at least to enable him to guard against the danger at which this provision of the act is aimed. Id. Corporations are not to be allowed to reduce their capital when their stock is above par in the market. Id. Action of corporation and registered shareholders in reducing relative value of shares by contract to surrender percentage of stock, is not binding upon assignees having possession of certificate, though holding under unregistered transfers. Campbell v. Am. Z. Co., 122 N. Y., 455; rev'g 23 J. & S., 592. When notice may be waived. Hallett . Met. Mess. Co. 69 App. Div. 258. 45. Notice of meeting to increase or reduce capital stock. Every such increase or reduction must be authorized either by the unanimous consent of the stockholders, expressed in writing and filed in the office of the secretary of state and in the office of the clerk of the county in which the principal business office of the corporation is located, or by a vote of the stockholders owning at least a majority oJ the stock of the corporation, taken at a meeting of the stockholders specially called for that purpose in the manner provided by law or by the by-laws. Notice of the meeting, stating the time, place and object, and the amount of the increase or reduction proposed, signed by the president or a vice president and the secretary, shall be published once a week, for at least two successive weeks, in a newspaper in the county where its principal business office is located, if any is published therein, and a copy of such notice shall be duly mailed to each stockholder or member at his last-known post-office address at least two weeks before the meeting or shall be personally served on him at least five days before the meeting. Amended by ch. 354 of 1901. In effect April 16, 1901. See section 21, chap. 40 of 1848, section 16, chap. 611 of 1876, and section 2, chap. 264 of 1878, now repealed. In the absence of evidence that due and sufficient notice of the meeting was not given to the stockholders, the books of minutes of the company and the certificate showing that more than two-thirds of the stockholders appeared in person or by proxy, and voted for the increase of the stock, establishes, in an action to enforce an assessment upon stock, that the stock was increased at a regularly assembled meeting of the stockholders. Cuykendall v. Douglas, 19 Hun, 577. 46. Conduct of such meeting; certificate of increase or reduc- tion. If, at the time and place specified in the notice, the stockholders shall appear in person or by proxy in numbers representing at least a majority of all the shares of stock, they shall organize by choosing from their number a chairman and secretary, and take a vote of those 48 STOCK CORPORATION LAW. present in person or by proxy, and if a sufficient number of votes shall be given m favor of such increase or reduction, or if the same shall have been authorized by the unanimous consent of stockholders ex- pressed in writing signed by them or their duly authorized proxies, a certificate of the proceedings showing a compliance with the provisions of this chapter, the amount of capital theretofore authorized, and the proportion thereof actually issued, and the amount of the increased or reduced capital stock, and in case of the reduction of capital stock the whole amount of the ascertained debts and liabilities of the corpo- ration shall be made, signed, verified and acknowledged by the chair- man and secretary of the meeting, and filed in the office of the clerk of the county where its principal place of business shall be located, and a duplicate thereof in the office of the secretary of state. In case a reduction of the capital stock, except of a railroad corporation or a moneyed corporation, such certificate or consent hereinafter provided for shall have indorsed thereon the approval of the comptroller, to the effect that the reduced capital is sufficient for the proper purposes of the corporation, and is in excess of its ascertained debts and liabil- ities ; and in case of the increase or reduction of the capital stock of a railroad corporation or a moneyed corporation, the certificate, or the unanimous consent of stockholders as the case may be shall have in- dorsed thereon the approval of the board of railroad commissioners, if a railroad corporation; of the superintendent of banks, if a cor- poration formed under OP subject to the banking law, and of the superintendent of insurance if an insurance corporation. When the certificate herein provided for, or the unanimous consent of stock- holders in writing, signed by them or their duly authorized proxies, approved as aforesaid, has been filed, the capital stock of such corpo- ration shall be increased or reduced, as the case may be, to the amount specified in such certificate or consent The proceedings of the meet- ing at which such increase or reduction is voted, or, if such increase or reduction shall have been authorized by unanimous consent without a meeting, then a copy of such consent shall be entered upon the minutes of the corporation. If the capital stock is reduced, the amount of capital over and above the amount of the reduced capital shall, if the meeting or consents so determine or provide, be returned to the stockholders pro rata, at such times and in such manner as the directors shall determine, except in the case of the reduction of the capital stock of an insurance corporation, as an alternative to make good an existing impairment. Amended by ch. 354 of 1901. In effect April 16, 1901. Amended by ch. 286 of 1902. In effect March 20, 1902. See section 22, chap. 40, of 1848; section 3, chap. 264, of 1878, and section 3, chap. 306, of 1882, now repealed. Amended by ch. 123 of 1904. In effect March 23, 1904. A person who was named as one of the trustees in the articles of association and had acted as such at a prior meeting 1 , was held to be qualified to act as chainnaq B,t a meeting called under this section. Cuykendall v. Douglas, 19 Hun, 677. The object of this provision in the statute was to provide a mode of proof of the instrument, to establish its genuine character. Id. Where the signature of the chairman h in the presence of the justice, and the latter has witnessed and certified it, the object of the statute is answered. Id. A certificate of ac- knowledgment is only required to be in " substantial compliance " with the statute. Id.; Thurman v. Cameron, 24 Wend., 87 ; West P. I. Co. v. Reymert, 45 N. Y. t 703 ; Can. Acad. v. McKechnie, 19 Hun, 63. The amount of the capital may be reduced before it has been actually paid i Strong v. Brooklyn C.-T. R. R. Co., 93 N. Y., 426. The reduced amount may stil exceed the sum which has been actually paid in, and in that case, the stockholders must pay it in after the reduction. Id. In such case, there can be no surplus for distribution. Id. The reduced amount becomes the amount which the com- pany is bound by law to provide as capital. Id. To authorize a corporation to avail itself of the provisions of this sect on, it must obtain the certificate of the Comptroller that the market value of its stock is IMS than par. Id. The reduction which the act has in view is the reduction of 49 (he nominal capital to an amount which shall correspond with its actual value, rather than a withdrawal and distribution of actual capital. Id. See Seeley v. N. Y. Nat. Ex. Bk , 8 Daly, 400; aff'd 78 N. Y., 608. There was no provision in the former law for returning any portion of the actual capital held by the company to the stockholders, nor for any inquiry into the financial condition of the company, beyond the fact how much of the capital was paid in and the amount of its debts not secured by trust mortgages. Strong v. Brooklyn C.-T. R. R. Co., ante. But the above section (46) provides that in case the capital stock is reduced, the amount of capital over and above the amount of the reduced capital shall be returned to the stockholders pro rata at sucl- times and in such manner as the directors shall determine. To authorize such a distribution, if the original capital has been paid in, it Bhould appear that the capital so paid in has not been impaired ; and, if it has been impaired, it should appear that the corporation still has on hand actual capital, available for the payment of debts, exceeding the amount to which it has reduced its capital. Strong v. Brooklyn C.-T. R. R. Co., id. If it has, the excess only ought to be distributed. Id. The surplus, which a corporation, in such case, is at liberty to pay to its stock- holders, must, in every case, be ascertained, and depends upon the result of an examination into its affairs, and not upon the difference between the original amount of capital and the reduced amount. Id. Whenever the corporation, by sales of property, or by means of earnings, or otherwise, comes in possession oi funds which are in excess of the reduced amount fixed as capital, it can distribute that excess without violating any law. Id. Upon the increase of the capital of a corporation, the trustees, in disposing of the increased stock, are to be considered as trustees for those holding shares of the original stock, and it is their duty to so dispose of them that as much value as possible shall be returned to the corporation for its business purposes. Williams -o. W. U. T. Co., 9 Abb. N. C., 419. See Sullivan v. Parker, 69 App. Div. 221. 47. Preferred and common stock. Every domestic stock corporation may issue preferred stock and common stock and different classes of preferred stock, if the certificate of incorporation so provides, or by the consent of the holders of record of two-thirds of the capital stock, given at a meeting called for that purpose upon notice such as is required for the annual meeting of the corporation. A certificate of the proceedings of such meeting, signed and sworn to by the president or a vice-president, and by the secretary or assistant secretary, of the corporation, shall be fined and recorded in the offices where the original certificate of incorporation of such corporation was filed and recorded; and the corporation may, upon the written request of the holders of any preferred stock, by a two-thirds vote of its directors, exchange the same for common stock, and issue certificates for common stock therefor, upon such valuation as may have been agreed upon in the certificate of organization of such corporation, or the issue of such preferred stock, or share for share, hut the total amount of such capital stock shall not be increased thereby. Amended by ch. 354 of 1901. In effect April 16, 1901. See section 1, chap. 225 of 1880, now repealed. There is no power in a corporate body, nor in a majority of the stockholders, to provide by a by-law for the creation of a preferred stock, so as to bind a minority of the stockholders not assenting thereto. Kent r. Quicksilver M. Co., 78 N. Y. 159. A corporation may begin its corporate action by classifying the shares in its capital stock, with peculiar privileges to one share over another, and thus offer its stock to the public for subscriptions thereto. Id. Purchaser of stock takes it subject to right of legislature to amend law. Hinckley v. Schwarzschild & Sulzboyer, 45 Misc. 176, aff'd 107 App. Div. 470. Amendment of chap. 354 of 1901, permitting corporations to issue preferred stock with the consent of two-thirds of stockholders, held valid. Hinckley v. Schwarxschild & Sulzberger Co., 107 App. Div. 470. 48. Prohibited transfers to officer! or stockholders. No corpora- tion which shall have refused to pay any of its notes or other obliga- tions, when due, in lawful money of the United States, nor any of its officers or directors, shall transfer any of its property to any of it* 50 STOCK CORPORATION LAW. officers, directors or stockholders, directly or indirectly, for the payment of any debt, or upon any other consideration than the full value of the property paid in cash. No conveyance, assignment or transfer of any property of any such corporation by it or by any officer, director or stockholder thereof, nor any payment made, judgment suffered, lien created or security given by it or by any officer, director or stockholder when the corporation is insolvent or its insolvency is imminent, with the intent of giving a preference to any particular creditor over other creditors of the corporation shall be valid, except that laborers' wagea for services shall be preferred claims and be entitled to payment before any other creditors out of the corporation assets in excess of valid prior liens or incumbrances. No corporation formed tinder or subject to the banking, insurance or railroad law shall make any assignment in contemplation of insolvency. Every person receiving by means of any such prohibited act or deed any property of the corporation shall be bound to account therefor to its creditors or stockholders or other trustees. No stockholder of any such corporation shall make any transfer or assignment of his stock therein to any person in contempla- tion of its insolvency. Every transfer or assignment or other act done in violation of the foregoing provisions of this section shall be void. No conveyance, assignment or transfer of any property of a corporation formed under or subject to the banking law, exceeding in value one thousand dollars, shall be made by such corporation, or by any officer or director thereof, unless authorized by previous resolution of its board of directors, except promissory notes or other evidences of debt issued or received by the officers of the corporation in the transaction of its ordinary business and except payments in specie or other current money or in bank bills made by such officers. No such conveyance, assignment or transfer shall be void in the hands of a purchaser for a valuable consideration without notice. Every director or officer of a corporation who shall violate or be concerned in violating any provisions of this section, shall be personally liable to the credit- orsand stockholders of the corporation of which he shall be director or an officer to the full extent of any loss they may respectively sustain by such violation. Amended by ch. 354 of 1901. In effect April 16, i901, The provisions of this section are intended as a restraint on the action of thf directors and officers of the company and of them only. Kingsley v. First Nat. Bk., 31 Hun, 329. They do not control or direct the action of creditors, who may eek to collect or secure payment of their debts against the corporation. Id. This section declares the assignment on transfer void, in case the same is made in contemplation of insolvency. Id. The simple question is, was there actual or contemplated insolvency and a transfer of property for the benefit of creditors. Id. ; Brouwer v. Harbeck, 9 N. Y., 589; Harris v. Thompson, 15 Barb., 62- Rob- inson v. Bk. of Attica, 21 N. Y., 406* hereafter contracted or any stock hereafter issued; but nothing in tlm section contained shall create or increase any liability of stockholders c any existing corporation under any general or special law. STOCK CORPORATION LAW. holders of every stock corporation shall jointly and severally be per- sonally liable for all debts due and owing to any of its laborers, servants or employes other than contractors, for services performed by them for such corporation. Before such laborer, servant or employe shall charge such stockholder for such services, he shall give him notice in writing, within thirty days after the termination of such services, that he intends to hold him liable, and shall commence an action therefor within thirty days after the return of an execution unsatisfied against the corporation upon a judgment recovered against it for services. No person holding stock in any corporation as collateral security, or as executor, administrator, guardian or trustee, unless he shall have volun- tarily invested the trust funds in such stock, shall be personally subject to liability as a stockholder; but the peison pledging such stock shall be considered the holder thereof and shall be liable as stockholder, and the estates and funds in the hands of such executor, administrator, guard- ian or trustee shall be liable in the like manner and to the same extent as the testator or intestate, or the ward or person interested in such trust fund would have been, if he had been living and competent to act and held the same stock in his own name, unless it appears that such executor, administrator, guardian or trustee voluntarily invested the trust funds in such stocks, in which case he shall be personally liable as a stockholder. Amended by ch. 854 of 1901. In effect April 16, 1901. Former section 57. Bee section 5, title 3, chap. 18, part 1, R. 8.; section 10, 11, 16, 18, chap. 40 of 1848 ; section 10, chap. 282 of 1854, and sections 23, 37, chap. 611 of 1875, now repealed. The object of this section in requiring a certificate to be filed is to inform the public ao that they can transact business with the corporation, upon the assur- ance that the capital stock has all been paid in, or that the stockholders are severally liable for an amount equal to the stock held by them respectively. Nat. T. W. Co. . Gilfillan, 124 N. Y., 302. A statute which imposes upon the stockholders of a corporation a personal liability for the corporate debts must be strictly construed. Chase v. Lord, 77 N. Y. f 1. It can not be extended beyond its literal terms. Id. In such case, the legal presumption is that all statutory conditions have been complied with. Id. The creditor, before he can charge a stockholder, must establish a non-com- pliance with the provisions of the statute. Id.; Bruce . Driggs, 25 How., 71. Where a certificate of stock is filled out and signed by the president and secretary of a corporation, the person named therein is a stockholder, though the certificate is not detached from the stock-book, and the company's seal is not affixed thereto. HaJsteadfl. Dodge, 51 Supr., 169. The tiling of the proper certificate in the office of the county clerk, under th general incorporation act, is sufficient to constitute those making and filing it, a corporation, as to one dealing- with them as such. Raesbeck v. Destenreicher, 18 Alb. L. J., 211. A filing of the required duplicate in the office of the Secretary of State is not necessary. Id. It is enough, in ordinary actions, to prove the existence of de facio coi-poration. Benesch v. J. H. M. L. Ins. Co., 16 Daly, 394. Where the subscription is void under section 41, the subscriber does not become a stockholder even as to creditors, and can not be held individually liable for the debts of the company under this section. Perry v. Hoadley, 19 Abb. N. C., 76. Persons signing the articles of association of a manufacturing company are stock- holders. Strong v. Wheaton, 38 Barb., 616. When the holding [of stock is once established, it must be presumed to continue, until its surrender or assignment in shown. Id. Where the bonds of a corporation have been issued by it gratuitously to a stockholder, but no portion of its property or assets has been applied in payment thereof, the stockholder is not liable to account to creditors for the proceeds of the ale of said bonds by him. Christensen v. Eno, 106 N. Y . 97. .V STOCK CORPORATION LAW. The principle upon which persons subscribing or engaging to take stock an held liable, was considered in Seymour v. Sturgess, 26 N. Y., 134. A person, who haa signed and acknowledged the articles of association of a corporation created under this act, and was named a trustee therein, can r.ot deny, in an action under this section, that he was, at the time of signing the ar- ticles, a stockholder thereof. Herries v. Wesley, 13 Hun, 492. In such case, he will be presumed to continue to be one until the contrary is established. Id. : Strong v. Wheaton, 38 Barb., 617. The purchase of stock in a corporation makes the buyer a stockholder. Peoole v North R. 8. R. Co., 121 N. Y., 582. The acceptance and holding of a certificate of the stock subjects the holder to th liabilities of a stockholder. Van Cott v. Van Brunt, 2 Abb. N. C., 283. Person can not be made stockholder of corporation, without his knowledge or consent. Glen v. Garth, 39 N. Y. St. Rep., 473. He is not estopped as against creditor of corporation from denying that he is shareholder. Id. Corporative stock, issued to executor in representative capacity, is vested in him. Matter of Santa E. S. M. Co., 21 N. Y. St. Rep., 89. Subject to the limitations and qualifications of this and the next sections, the liability of a stockholder, before the capital is paid in, or certificate filed, stands upon a similar footing to that of partners in any company or association not incor- porated. King v- Duncan, 38 Hun, 461 ; Allen v. Sewall, 2 Wend., 327 ; Moss v. Oakley, 2 Hill, 265 ; Corning v. McCullough, 1 N. Y., 47 ; Harger v. McCullough. 2 Denio, 119 ; McKinney i>. Phillips, 24 Barb., 87. The liability under this section is qualified only by the following section. King t>. Duncan, 38 Hun, 461. Each stockholder's liability under this section is limited to the amount of his ptock. Wiles v. Suydam, 64 N. Y., 173. Trustees are excluded from the scope, as well as the policy, which this section nas intended to promote. McDowall v. Sheehan, 41 N. Y. St. Rep., 415. They are not entitled to the protection which the law intends to secure to creditors of the corporation. Id. The directors of a moribund corporation can not constitute themselves creditors for salaries or wages and thus impose liabilities upon confiding and innocent stockholders. Id. The requirement as to the recording of the certificate is directory merely. Veeder v. Mudgett, 95 N. Y.,295. The duty imposed upon the stockholders la performed upon the making and delivery of the certificate to the county clerk for record. Id. They are not liable for an omission to record, which is wholly the fault of the clerk. Id. An acknowledged, but unsworn, certificate of the increase of capital stock is not a compliance with, nor does it terminate the liability of the owners of the new shares for the debts of the corporation under this section. Hardman v. Sage, 124 N. Y., 25 ; Brown v. Smith, 13 Hun, 408; aflPd 80 N. Y., 650; Veeder t?. Mudgett, 5 N. Y., 295. The certificate must be sworn to, and a mere acknowledgment is not a sufficient compliance with the provisions of this section. Brown v. Smith, 13 Hun, 408; aff'd 80 N. Y., 650. The certificate, under this section, is not conclusive, and creditors may show non- payment in fact of the full capital. Barre Nat. Bk. v. Hingham Mfg. Co., 127 Mass., 563. The conclusiveness of such certificate was not in any manner inti- mated or sustained by the case of Bonnell v. Griswold, 80 N. Y., 128. See Veeder v. Mudgett, 95 N. Y., 295 ; Schenck v. Andrews, 46 N. Y., 589; Boynton v. Same, 63 id., 93; Same v. Hatch, 47 id., 225 ; 13 Hun, 411 ; 80 N. Y., 650 ; Wheeler v. Millar, 90 id., 358. The question whether the certificate is even presumptive evidence of payment was raised, but not decided, in Veeder v. Mudgett, ante. The stockholder remains liable till the whole amount of the capital stock is paid in and the required certificate filed, but only to a creditor against whose claim the statute haa not run. Knox v. Baldwin, 80 N. Y., 610. Debt contracted before capital stock has been paid in, either in cash or in equiva- lent property, is alone sufficient to make stockholder liable. N. T. W. Co. v. Gilfillan, 124 N. Y., 302. Stockholders are individually liable where property procured in exchange for stock is purchased at over-valuation, not through error of judgment, but in bad faith and to evade statute. Id. 57 STOCK CORPORATION LAW. The cause of action under this section consists of a debt and the liability created by statute against stockholders when the stock has not been paid in and a certifi- cate of that fact recorded. Wiles v. Suydam, 64 N. Y., 173. This section, in effect, withdraws the protection of the corporation from the stockholders, and regards them liable to the extent of the amount of their stock as co-partners. Id.j Corning ). McCullough, 1 N. Y., 47. Under this section two things are requisite to end the stockholder's liability. The whole amount of capital stock must be paid in, and the certificate of that fact made and recorded. Veeder v. Mudgett, 95 N. Y., 295 ; Plase v. Housman, 17 N. Y. St. Rep., 671 ; Chase v. Lord, 77 N. Y., 1 ; Aspinwall v. Sacchi, 57 id., 331. The liability, as created by this section, is limited by two things, both of which, to exempt the stockholder, must be fully complied with. First. The whole amount of the capital stock, fixed and limited by the company, shall have been paid in. Second. A certificate of such payment shall have been made, filed and recorded, M prescribed in this section. Brown v. Smith, 13 Hun, 408 ; aff'd 80 N. Y., 650. Such liability is not confined to the original capital stock. Veeder v. Mudgett, 95 N. Y., 295. On an increase of the capital, it attaches to such increased capital. Id. The liability, which was ended when the original capital was paid in, in full, nd a certificate made and recorded, is not revived by an increase of the capital. Veeder v. Mudgett, 95 N. Y., 295. In such case, the holders of the original stock are not liable thereon because of a failure to pay in the increased capital. Id. The liability rests solely upon the holders of the increased stock, and is limited by the par value of such stock. Id. In case of an attempt to increase the capital, the stockholders, who have voted for the increase, accepted their share of the additional stock and received thereon, are estopped, as against creditors, from questioning the validity of the increase. Veeder v. Mudgett, 95 N. Y., 295. The omission to file a certificate as to the payment of the increase of capital, sub- jects not the holders of the captial stock, which has been fully paid up, and as to which there is no statutory default, but the holders of the new issue of capital stock to liability for corporate debts. Griffith v. Green, 129 N. Y., 517 ; 42 N. Y. St. Rep., 101 ; Veeder v. Mudgett, 95 N. Y., 295. In such case, the burden ia on the creditor to show that the stock of the defendant stockholder constituted part of the increased capital stock. Griffith v. Green, ante. In an action against a stockholder for failure to file a certificate of payment of increased stock, the burden is upon the creditor to show that defendant's stock was increased stock. Griffith v. Green, 37 N. Y. St. Rep., 705. Burden of proving non-payment of subscription is on plaintiff. Wellington . C. C. & I. Co., 52 Hun, 408. Payment by stockholder of stock to company relieves him from liability. Id. Creditors must sue in equity all similar (stockholders. Id. Settlement of parties to contract, bars right of action by third party on promise therein to assume and pay his claim. Id. A remedy given by the statutes of another state to creditors of a corporation against its stockholders is not available here. Christensen v. Eno, 106 N. Y., 97 ; Lowry v. Inman, 46 id., 119. Common-law action will lie in this state by judgment creditor of a corporation, organized in another state, against stockholders to enforce statutory liability created by laws of that state. Savings Ass'n . O'Brien, 51 Hun, 45. An action may be maintained on the stockholder's liability in a state other than that in which the corporation was formed. Griffith v. Mangam, 42 Supr., 369. What must be alleged to constitute a cause of action under this section. Cuykendall v. Corning, 88 N. Y., 129, 137. What constitutes a debt within the meaning of the former acts, has had many and contradictory decisions ; but when a debt is contracted, has been adjudicated in only a very few cases. To create a liability under this section, a valid debt must be contracted under the circumstances therein mentioned and before the capital stock has been paid in, either in money or in property honestly regarded as a fair equivalent to cash. National Tube W. Co. v. Gilfillan, 124 N. Y., 302. A stockholder can not be held liable for rent due under a lease for more than a year which did not fall due within a year of the making of a lease. Goff v. Whit- ney, 9 City Ct., 966. 58 STOCK CORPORATION LAW. Under a corporate lease for five years, the rent payable within two years from the time of executing the lease and delivering the premises, is recoverable in an action under section 57 of this chapter ; but the rent accruing beyond that time is not a liability that can be enforced against the individual stockholders. Mclntyre D. Strong-, 63 How., 43. The liability covers all debts and contracts made by the company, iiTespective of the circumstances under which they were made. National T. W. Co. t>. Gilfil- lan, 124 N. T., 302. That credit was imprudently given by the creditor, or that he gave credit upon the supposition that the corporate property was sufficient to pay the debts, creates no exemption from liability under this section. Id. This liability is governed by the original indebtedness, and can not be extended or renewed by any extension or renewal which the creditor may make with the corporation. Hardman v. Sage, 47 Hun, 230 ; Parrott v. Colby, 6 Hun, 55 ; aflPd 71 N. Y., 597 ; Jagger Iron Co. v. Walker, 76 id., 521 ; Parrott v. Sawyer, 87 id., 622. The liability of a stockholder can not be revived or extended by any renewal or extension of the indebtedness which the creditors may make with the corporation Parrott v. Colby, 6 Hun, 55 ; aft" d 71 N. Y., 597 ; Jagger Iron Co. v. Walker, 76 id., 521. An action can be brought only against such as were stockholders, when the debt was contracted, and not those who became so afterwards. Moss v. Oakley, 9 Hill, 265. A stockholder is not liable, under this section, for corporate debts contracted be- fore he became such. Tracy v. Yates, 18 Barb., 152 ; Phillips v. Therasson, 11 Hun, 141. A trustee may recover for services rendered to the corporation. McDowall u. Sheehan, 36 N. Y. St. Rep., 104. The provision of this section applies to holders of stock issued in payment for property purchased by the corporation. Boynton v. Andrews, 63 N. Y., 93. In such case, the question is, whether the purchase was made in good faith, or at a high valuation with a fraudulent intent to evade the provisions of the statute. Id. An honest over-valuation will not of itself subject the owner of the stock to a per- sonal liability. Id. Under the former law, a stockholder, to whom stock was issued in payment of property, was not, in absence of fraud in its valuation, liable to the creditors of the company because of a failure on the part of the proper officers to file the required certificate. Brown v. Smith, 13 Hun, 408; 80 N. Y., 650; Boynton t>. Andrews, 63 id., 93 ; Same v. Hatch, 47 id., 225 ; Schenck v. Andrews, 57 id., 133; Same v. Same, 46 id., 579. Under the former law, in Schenck v. Andrews, 46 N. Y., 589, it was held that the whole capital stock could be paid for in property, and when so paid for, the owner thereof was not liable to the creditors of the company under section 10 of the act of 1848. But this case was limited and distinguished in same case, 57 N. Y., 133. It was held, in Boynton v. Hatch, 47 N. Y., 225, that, when the capital stock was fully paid in either money or property and the certificate filed, the stockholders are released from personal liability. The transaction was impeachable for fraud. Id. A fraudulent and evasive issue of stock for such purpose rendered the holder liable. Id. The agreement of the company to pay more than the value of the property was no shield from personal liability under section 10 of the act of 1843. Id. A legal fraud is established by proof that the stock of the company, not fully paid, has been issued as fully paid stock. National T. W. Co. v. Gilfillan, 124 N. Y., 302. It is not necessary to show otherwise an actual fraudulent intent. Id. A fraud is consummated by the issue of stock, as paid up stock, when in fact it has not been paid for either in money or in property of equal value. Thurston t>. Duffy, 38 Hun., 327 ; Douglass v. Ireland, 73 N. Y., 100. A deliberate design to perpetrate a fraud on the law by an evasion of its provision and secure personal immunity by assumed compliance with the statute, which is false and hollow in fact and exists on paper only, renders the stockholders personally liable under this section. Id. Where stock is issued for property purchased for the company, and the transac- tion is fraudulent in law, the holders of such stock are liable for the unpaid portion thereof. Gamble v. Queens Co. W. Co., 52 Hun, 166 ; 25 Abb. N. C., 410. A provision that part of the stock so issued was to be sold for less than par and 59 STOCK CORPORATION LAW. the proceeds given to the company, was held, in Draper v. Beadle, 16 W. Dig., 475, not to be conclusive evidence of an over-valuation, but that the question was still one of fact for the jury. Id. See Lake Sup. Iron Co. v. Drexel, 90 N. Y., 87 ; 15 W. Dig., 341. Where the stock of a corporation is issued in form for property, it is to b regarded as full-paid stock, unless there are, in said issue, a fraudulent over-valu- ation and an intent to evade the statute. Draper v. Beadle, 16 W. Dig., 475. In an action to charge a holder of stock issued for property purchased by the company on the ground of a fraudulent over-valuation thereof, proof of an offer for part of it, made to and refused by the company, if in good faith, bears with force, and is admissible, upon the question aa to whether or not there had been a fraudulent over- valuation of the land by the trustees. Thurber v. Thompson, 21 Hun, 472. Where the evidence ia not conclusive, the question whether the trustees, in exchanging- the stock of the company for the property taken, were endeavoring to evade and circumvent the law, should be submitted to the jury. Lake Sup. Iron Co. v. Drexel, 90 N. Y., 87 ; Douglass v. Ireland, 73 Id., 100 ; Brockway v. Same, 6i How., 372. It must be shown that the company, with the concurrence of the stockholder, shall have acted in bad faith in issuing the amount of stock delivered for the prop- erty purchased. Nat. T. W.Co. v. Gilfillan, 46 Hun, 248; Douglass v. Ireland, 73 N. Y., 100 ; Thurston v. Duffy, 38 Hun, 327 ; Lake Sup. Iron Co. v. Drexel, 90 N. Y., 67 ; Blake v. Griswold, 103 N. Y., 429. To charge the holder of stock, issued upon and for the purchase of property, it must be shown that the purchase was in bad faith and to evade the statute. Douglas v. Ireland, 73 N. Y., 100. No other fraudulent intent need be alleged or proved than that the stock exceeded in amount the value of such property, and that the trustees so issued it deliberately and with knowledge of the real value of the property. Id. The value of the property must be determined, and evidence thereof is competent. Id. The trustees are the judges both aa to the necessity for, and the value of the property. Schenck v. Andrews, 57 N. Y., 133. Good faith and the exercise of a proper discretion and honest judgment meet the requirement. Id. A mere mistake or error of judgment, by the trustees, either as to the necessity of the purchase or as to the value of the property so purchased, if made in good faith and not in evasion of the provision of the statute, will not subject a holder of stock issued in payment for the property purchased to liability under this section. Schenck v. Andrews, 57 N. Y., 133; Gamble v. Queens Co. W. Co , 52 Hun, 166; 25 Abb. N. C., 410. Where the capital stock has been issued for property purchased for the corpora- tion without any actual fraudulent intent, subscribers who became such subse- quent to such transaction, and did not participate in it, can not sue each other in an action at law. Dodge v. Havemeyer, 4 N. Y. St. Rep., 5G1. The remedy, in sxich caee, is by a suit for an accounting to fix the pro rat a liability of the stock- holders, and not by a suit to recover the whole debt from an individual stock- holder. Id. ; Mathez v. Neidig, 72 N. Y., 100; McMaster v. Davidson, 29 Hun, 542 ; Bailey v. Bancker, 3 Hill, 188; Richardson i>. Abendroth, 43 Barb., 162. Fraud in such cases is an important element, and must be affirmatively proved. Dodge v. Havemeyer, 4 N. Y. St. Rep., 561 ; Brown v. Smith, 13 Hun, 40 > ; affM 80 N. Y., 650 ; Sohenck v. Andrews, 57 id., 133; Boynton v. Same, 63 id., 93 ; Lake Superior Co. v. Drexel, 90 id., 93 ; Douglass v. Ireland, 73 id., 100. The holder of capital stock issued for property acquired by the corporation, is not exempted from liability under this section, where such stock exceeded in amount the value of the property in exchange for which it was issued, and the trustees have deliberately, and with knowledge of its real value, over-valued it and paid in stock for it an amount which they knew was in excess of its actual value. Douglas v. Ireland, 73 N. Y., 100 ; Boynton v. Hatch, 47 id., 225 ; Same t). Andrews, 63 id., 93 ; Schenck v. Same, 57 id., 133 ; Lake Superior Co. v. Drexel, 90 id., 87 ; Blake v. Griswold, 103 id., 429 ; Brown v. Smith, 13 Hun, 408 ; affd SON. Y., 630; National Tube Co. r. Oilfillan, 124 N. Y., 302 ; Dodge t). Havemeyer, 4 N. Y. St. Rep., 561 ; Goodrich v. Dorman, 38 id., 198. A purchase of property from one of the trustees for the benefit of the corpora- tion may be made under this section, if made in good faith, for a proper considera- tion, and without any attempt to evade the statute. Knowles v. Duffy, 40 Hun, 486. This rule applies though the entire capital stock is paid therefor. Id. 60 STOCK CORPORATION LAW. Where property, procured in exchange for stock, is purchased at an over-valua- tion, not through au error of judgment, but in bad faith and to evade the statute, the stockholders are individually liable. Nat. T. W. Co. v. Gilfillan, 124 N. Y., 302. The statute liability constitutes a fund which belongs to the creditors to secure the payment of their debts. Mathez . No. dig, 72 N. Y., 100. It belongs to all the creditoi-s, as well those who are, as those who are not, stockholders. Id. The stockholders, under this and following sections, are liable in an original and primary sense, like partners or members of an unincorporated association, and their liability is not created by the statute of incorporation. Corninjr r Cullough, 1 N. Y., 47. A stockholder, who is liable for the debts of the company to the amount of the stock held by him, dos not stand in the light of a guarantor or surety, but is a principal debtor. Moss v. McCullough, 7 Barb., 27.-. The property of every corporation is to be regarded as a trust fund for the pay- ment of its debts. Hastings v. Drew, 76 N. Y., 9. The creditors have a lien thereon and may follow it into the hands of the director and stockholders. Id. "Where such property has been divided among the stockholders, a judgment creditor, after returns of an execution against the corporation unsatisfied, can maintain an action ; in the nature of a creditor's bill against a stockholder, to reach whatever was so received by him. Id. A creditor of a corporation, the stockholders of which are liable for its debts, may bring a suit in equity against all stockholders liable to him, and in favor of all creditors jointly interested with him who choose to come in and share in the benefits and expenses of his suit for the establishment of a fund, for the adjust- ment of all liabilities to contribute thereto, and of all claims thereon. Pfohl . Simpson, 74 N. Y., 137 ; Mathez -p. Neidig, 72 id., 100 ; Griffith v. Mangam, 73 id., 611 ; Weeks v. Love, 50 id., 568. Such action will not give a right or impose a liability which does not exist otherwise. Id. This personal liability may be enforced in an equitable action against all the stockholders. Weeks v. Love, 50 N. Y., 568 ; Briggs v. Penneman, 8 Cow., 387 ; Mann v. Pentz, 3 N. Y., 415 ; Osgood v. Laytin, 5 Abb., N. S,, 1. The creditor has his election to bring an action at law against a stockholder, or to bring an action in equity, and have an accounting between all the stockholders and all the creditors, wherein the rights of each can be ascertained and protected. Mathez v. Neidig, 72 N. Y., 100 ; Bank "of Poughkeepsie v. Ibbotson, 24 Wend., 73 ; Briggs v. Pennington, 8 Cow., 392 ; Garrison v. Howe', 17 N. Y., 458 ; Matter of Empire City Bk., 18 N. Y., 227. A n action at law can be maintained against one of several stockholders to recover a debt owing by the corporation. Weeks v. Love, CO N. Y., 568 ; Bank of Pough- keepsie v. Ibbotson, 24 Wend., 472 ; Garrison v. Howe, 17 N. Y., 458. Such action can be maintained by a single creditor. Id. This section is not confined to the case of a suit against a stockholder by a sole creditor of the corporation. Id. One of several creditors is entitled to maintain the action. Id. It is not a joint right in the creditors generally. Id. A creditor can, after exhausting his remedy at law, maintain an action against a stockholder, to reach his unpaid subscription, and be subrogated to the right of the company, without joining other stockholders or creditors. Wheeler v. Millar, 90 N. Y., 353 ; Hatch . Howe, 17 N. Y., 458. A creditor may proceed by suit, in the nature of a common law action, against a single stockholder. Garrison v. Howe, 17 N. Y., 458 ; Bank of Poughkeepsie v. lobotson, 24 Wend., 473. He is not compelled to bring an equitable action for an accounting, but may do so. Id. It is not necessary to make all the stockholders defendants to an action by a creditor of a corporation under this section. Abbott v. Aspinwall, 26 Barb., 20& Each creditor has a remedy against each stockholder. Id. Such remedy is no against such stockholders only as have not paid for their stock. Id. The stock held, not the amount of stock unpaid for, gives the measure of the recovery. Id. Creditors may enforce contribution from the stockholders, if the trustees negr- > him as the responsible party liable for the debts of the corporation. Shellingtoii v. Howland. 53 N Y 871. The stockholders, under this section, are principal debtors and not sureties. Harger v. McCullough, 2 Denio, 119. An extension of the time of payment given to the corporation by a creditor does not discharge a stockholder, who haa not assented to such extension, and who is subsequently sued on account of his indi- vidual liability. Id. By extending time for payment of debt due from manufacturing corporation, by one or several contracts, creditor loses his claim upon shareholders under this sec- tion. Hardman v. Sage, 124 N. Y., 25. When stockholders are relieved from liability by transfer. Tucker v. Oilman, 121 N. Y., 189. Transfer, made before indebtedness accrued, is defense. Id. Payment by stockholder to another creditor of full liability, though subsequent to action, is defense. Richards v. Brice, 15 Daly, 144. A dissolution of the corporation for not paying in the capital stock, within the S Described time, does not at all affect the stockholder's liability under this section, ing v. Duncan, 38 Hun, 461. It is expressly provided by section 6, chap. 567 of 1890, that the dissolution for any cause shall not take away or impair any remedy against the company, its stockholders or officers, for any liabilities incurred pre- vious to its dissolution. A corporation can only be dissolved by a formal judgment. Hollingshead v. Woodward, 35 Hun, 410. When the liability of a stockholder is released by a cancellation of his stock. Hollingshead v. Woodward, 35 Hun, 410. The failure of the clerk to do his duty by making a record of the certificate can not prejudice stockholders or trustees who have done all the law requires of them, or that they have the power to do. Sutherland v. Olcott, 29 Hun, 161 ; Boynton t>. Hatch, 47 N. Y., 225. The filing of the certificate relieves the stockholders from all personal liability. Sutherland v. Olcott, 29 Hun, 161. One must be a stockholder in fact, in order to be liable, and not merely a sub- Bcriber whose stock has been forfeited, and who no longer holds it. Mills v. Stewart, 41 N. Y., 384. An original corporator and signer of the articles of incorporation, who sub- scribed but did not pay for certain number of shares of stock, was a trustee and secretary of the corporation and actively engaged in its management, and appeared upon the corporate books as a stockholder, is a stockholder within the meaning of this section. Wheeler v. Millar, 90 N. Y., 353. Neither the issuing of a certificate, nor payment, is essential to make him such. Id. The certificate is only evidence of ownership. Id. This can be interred from other facts. Id. A person, who gives to a corporation his promissory note, payable at a future time, for a specified number of shares of its capital stock, and takes a receipt from an officer of the company, expressing that such note, when paid, will be in full for such shares, does not become a stockholder until the note matures and is paid, and a stock certificate is issued. Tracy v. Yates. IS Barb., 152. Where the corporation formed, or attempted to be formed, is different in its pur- poses from that in which a subscriber agreed to take stock, the condition of hi* STOCK CORPORATION LAW. ,/ contract is not performed, and he is not liable in an action to recover the amount of his subscription. Dorris v. Sweeney, 60 N. Y., 463. The legal and effectual formation of a corporation is a condition precedent to a subscriber's obligation to pay for stock. Dorris v. Sweeney, 60 N. Y., 463. Irregularities subsequent to organization of corporation furnish no defense to corporation or its directors or stockholders. Demarest v. Flack, 16 Daly, 337. A defect in the proceedings to organize a corporation is no defense to a stock- holder, sued under this section, who has participated in its acts of user as a cor- poration de facto, and appeared as a stockholder upon its books when the debt for which he is sued was contracted. Eaton v. Aspinwall, 19 N. Y., 119. The burden, under this section, is on the creditor to show that the capital stock of the company has not been paid in. Bruce V. Driggs, 25 How., 71 ; or that the certificate of payment in full has not been filed. Subsequent recovery of judgment against the company on notes given for ser- vices rendered prior to the filing of the certificate estops the creditor from resort- ing to the original consideration, in order to charge the stockholders with the pay- ment of the debt. Sutherland v. Olcott, 29 Hun, 161. Though a person is not a stockholder at the time the contract is made, he is liable for the installments falling due thereunder after he became, and while he continues to be a stockholder. McMaster v. Davidson, 29 Hun, 542. A stockholder may set up and rely upon the defense that the stock held and owned by him was issued in payment for property, purchased by the trustees and necessary for the business, and that it was full paid stock, not liable to any further calls or payments. Lewis v. Ryder, 13 Abb., 1. It is very doubtful whether this is now the law. Stock issued for money and property is placed on the same foot- ing by section 42 of this act, and no preference is shown to holders of the latter kind under section 40. An action at law, under this section, can not be maintained against a stockholder, who is also a creditor to an amount equal to his stock. Mathez v. Neidig, 72 N. Y., 100. It was held, in Chambers v. Lewis, 28 N. Y., 454, that a creditor, in setting up in his answer by way of counter-claim, the liability of the plaintiff as a stockholder, under a similar statute, must aver that the plaintiff held an amount of stock in the company equal to the amount of the debt of the defendant, for which the plaintiff is sought to be held personally liable. In order to enable a defendant stockholder to interpose the defense, that he is a creditor of the corporation, he need not bring himself within the provisions of the following section, (58). That section has no application to such case. Mathez v. Neidig, 72 N. Y., 100. A loan by a stockholder to the corporation to an amount equal to his stock, con- stitutes a defense in an action brought against him under this section. Agate v. Sands, 73 N. Y., 620. The fact that security was taken for the loan is immaterial. Id.; Wheeler v. Millar, 90 N. Y., 853. See also Christensen v. Colby, 43 Hun, 362. To make such defense, the stockholder must be really a creditor of the company. Wheeler v. Millar, 90 N. Y., 353. He is not in reality a creditor, if he owes on his unpaid subscription as much or more than enough to balance and extinguish his demand against the company. Id. It matters not that his debt has not been actually applied on the subscription ; nor that it has not been pleaded ; nor that his liability upon his subscription can not be asserted by the creditor in such action. Id. In an action under this section, it is a defense, that the stockholder is also a creditor of the company to an amount exceeding the amount of stock held by him. Richards v. Croker, 10 Abb. N. C., 73. In . Love. 50 N. Y., 568. 64 trrocx G iiii'ox.vrioN L\w That the judgment againsUhe corporation includes in-tallments which became due more than two years before the action was brought against the company, ia no defense to the balance of the claim in an action under this section. McMaster D. Davidson, 29 Hun, 542. The stockholder sued may have paid in full for his stock, but this does not re- lieve him, if others are in default. Wheeler v. Millar, 90 N. Y., 35S. A stockholder may be absolutely discharged from all liability under this sec- tion, by payme it, on legal compulsion, to any creditor or creditors for whose debts he is liable, if such payment equals the amount of his stock. Math- Nfidig, 72 N. Y., 100. To entitle him to interpose such discharge as an ab~ bar to a claim by other creditors, either at law or in equity, he must show that the payment was made to a creditor or creditors for whoee debts he was liable under this section. Id. Probably the same effect would result from a voluntary payment. Id. A stockholder may defeat an action brought to enforce his individval liability for its debts incurred before the capital stock is paid up, by showing that he has already paid, on account of the corporate debts, a sum equal to the amount of his stock. Garrison v. Howe, 17 N. Y., 458 ; Bank of Poughkeepsie v. Ibbotson, 24 Wend., 473. A trustee can not buy up the outstanding debts of the corporation for his own benefit, knowing it to be insolvent, with an intention to get an advantage over other creditors, and ho!d the purchased debts for their full amount. Bulkley v. Whitcomb, 121 N. Y., 107. In such case, he has no claim to offset, in an action under this section, beyond the amount actually paid. Id. Not only the liability imposed upon stockholders by the statute, but equitable liabilities, which may be invoked in behalf of a creditor, may be set off in an action under this section. Christensen v. Colby, 43 Hun, 362. It is essential to the maintenance of the defense of an equitable offset by the stockholder in an action under this section that he and the suing creditors stand upon an equality. Bulkley v. Whitcomb, 49 Hun, 290. This does not appeal- by simply showing that he has become possessed of a judgment against the company. Id. Where he buys such a claim, and neither puts anything into the treasury nor relieves the corporation from any liability, he will not be permitted to offset his demand upon the company against a creditor's demand upon him as a stock- holder. Id. A demand, which came to the stockholder by assignment after the company had passed into the hands of a receiver, can not be so intei-posed against a creditor. Brings v. Corn well, 9 Daly, 436. A receiver of a corporation, organized under this act, is not vested with the right of action given by this section to corporate creditors against the stock- holders. Farnsworth n. Wood, 91 N. Y., 308. A recovery by a receiver appointed by the supreme court as the successor of the statutory receivers or trustees, in an action to enforce the liability of the stockholders, is a bar to an action by a creditor. Cuykendall v. Douglas, 19 Hun, 577; Walker n. Grain, 17 Barb.. 119; Story v. Furman, 25 N. Y., 222. The liability of the stockholder under this section does not exist in favor of the corporation. Farnsworth v. Wood, 91 N. Y., 308. Nor for the benefit of all its creditors. Id. It was created only in favor of such creditors as are within the prescribed conditions, and is to be enforced by these in their own right and for their own special benefit. Id.; Tucker v. Gilman, 45 Hnn, 193. A receiver of a corporation is not vested with the right of action given by this section to corporate creditors against the stockholders. Farnsworth v. Wood, 91 N. Y., 80S. ThU liability exists only in favor of such creditors as are within the prescribed conditions, and is to be enforced by them in their own right and for their own especial benefit. Id. Such action is barred by the statute of limitations after the expiration of six years from the time the liability was incurred. Knox v. Baldwin, 80 N. Y., 610. The period of six years is the only limitation provided for suits of this descrip- tion. Corning v. McCullough, 1 N. Y., 47. An action under this section must be brought before the expiration of six year from the termination of the two years allowed for the paying up of the capital stock, or it will be barred by the statute of limitations. Phillips v. Therasson, 11 Hun, 141 ; Conklin v. Furman, 48 N. Y.. 527. An action under this section can be brought before the expiration of two years within which the stock must be fully paid in or the charter forfeited. King 65 STOCK CORPORATION LAW. Duncan, 38 Hun, 461. The requirements of the following section must be first nfct. Id. The case of Phillips v. Therasson, 11 Hun, 141, has not given a con- trary construction to the statute. Id. An action under this section is barred by the statute of limitations after the expiration of six years from the time the liability was incurred. Knox v. Baldwin, 80 N. Y., 610. It was not determined in this case whether the cause of action against the stockholder accrued at the expiration f.f the two years within which the whole capital stock was to be paid in under this section, or upon the recovery of judgment, or after judgment and execution, under section 58 of this chapter. The statute of limitations does not begin to run in favor of a stockholder until after the return of execution against the corporation. Handy v. Draper, 89 N. Y., 334 ; Rocky M. Nat. Bk. v. Bliss, id., 338. The moment a cause of action accrues against the company, it accrues, under this section, against each stockholder liable. Conklint). Furman, 57 Barb., 484} aff'd 48 N. Y., 527. At this time the statute of limitations begins to run against the stockholders. Id. The action, reported in 48 N. Y., 527, arose under section 44, chap. 210 of 1847, whereby provision is made that a joint action may be prose- cuted against the company and any one or more stockholders liable to contribute to the payment of its debts. A similar provision is found in section 7, chap. 567 of 1890, applicable to full liability corporations. In such case, it may be that an ac- tion under this section must be brought before the expiration of six years from the accruing of the debt against the company. In the case of a limited liability cor- poration, the rule of limitation enunciated in Phillips v. Therasson, 11 Hun, 141, may govern. Action against stockholders for non-filing of certificates of payment of stock may be revived against the personal representatives. Cochran v. Weichers, 25 N. Y. St. Rep., 571. No stockholder, in such action, can be cast in judgment for more than an amount equal to the sum of the stock owned by him individually, in addition to hi* liability to pay in full the stock subscribed for or bought by him. Pfohl v. Simp- son, 74 N. Y., 137. He will not be held for the debt of a creditor which was not created while he was a stockholder, nor will any creditor lose the benefit of th liability of a stockholder, who was such when his debt was created. Id. Stockholder's liability is limited to the amount of his stock with interest from th time of the commencement of the action. Handy v. Draper, 89 N. Y., 334. The allowance of interest in such action from the date of the recovery of judg- ment against the corporation is error. Handy v. Draper, 89 N. Y., 334. Interest upon the amount of debt, when the recovery is limited to the amount of the stock, can be allowed from the date of the commencement of the action. Bur/ t>. Wilcox, 22 N. Y., 557 ; Handy v. Draper, 89 id., 334 ; Shellington v. Howland, 53 id., 372. But these cases do not determine the rule as to interest, where tit* debt is less than the stockholder's liability, and the allowance of interest does not swell the recovery beyond that limit. Where the entire principle and interest of the debt do not exceed the limit of lia- bility, the allowance of interest from the maturity of the debt is proper. "Wheeler t). Millar, 90 N. Y., 353. The stockholder is liable for interest upon an amount equal to his stock, from th commencement of a suit against him, to enforce his individual responsibility. BUIT . Wilcox, 22 N. Y., 551. In an action under this section, an allegation "that as plaintiff is informed and verily believes, only a small portion of said stock has been paid off," is a sufficienl averment that the capital stock of the corporation had not been paid in in full. Wood, ard D. Holland M. Co., 39 N. Y. St. Rep., 411. The claimant, to hold a stockholder liable for his services, must come strictly within the denomination of a " laborer, servant or employee, other than con- tractor," of the corporation. Harris v. Norvell, 1 Abb. N. C., 127. In the enactment of such provisions as are embodied in the second clause ot this section, it has been the policy of the legislature to protect those only who are the least abje to protect themselves, and who earn their living by manual labor for a small compensation. Gurney v. A. & Q. W. Ry. Co., 58 N. Y., 358 ; Stryker t). Caasidy, 76 id., 53. Under chap. 611 of 1875, stockholders were not under any special liability to laborers, servants or employees for services performed for th corporation. Richards v. Beach, 19 Abb. N. C., 84. 66 STOCK CORPORATION LAW. Laborers or servants, within the meaning of this section, are persons who, in common parlance, and according 1 to the general understanding of men, fall under that appellation, in enumerating the different classes of persons employed by a corporation. Dean v. De Wolf, 16 Hun, 186; affd 83 N. Y., 626. An assistant, who performs all the duties of the superintendent in his absence, and receives a stated salary, is not a laborer or servant within the meaning of this section. Dean v. De Wolf, 16 Hun, 186 ; afTd 82 N. Y., 626. The performance of some manual labor, merely incident to his position of general superintendent of the company, does not bring a person within the provisions of of this section. Krauser v. Ruckel, 17 Hun, 463 ; Ericsson v. Brown, 38 Barb., 390. Under the act of 1848, the term "servant," was understood to relate and apply only to a person rendering services of a subordinate, but not necessarily of a menial character to an employer, varying in its nature according to the business or occupation in which it was rendered, and not to extend to and include every employee and party who does work for another. Hill v. Spencer, 61 N. Y., 274. It was associated with " laborers " and " apprentices," thus indicating that it was intended to apply to a pei-son employed to devote his time and render bis service in the performance of work, similar in its general character to that done by thoen employees. Id. The corresponding section of the new act (57) employs the word in a different context, and connects it with " laborers or employees, other than contractors." A bookkeeper was held, in Sherman v. Herbert, 2 City Ct., 314, not to be a " laborer" within the section of the former act making stockholders personally liable for the wages of laborers. Bookkeeper and general clerk is employee. Brown v. A. B. C. Fence Co., 02 Hun, 151. Bookkeeper is servant within this section. Chapman v. Chumar, 26 N. Y. St. Rep., 473. The term " salary," is not ordinarily employed to services performed by a "servant " in the general and usual understanding and meaning of the relation of 8n employee^to an exployer. Hill v. Spencer, 61 N. Y., 274. One employed to take charge of and control its property and manage its financial jffairs in another country, in all respects as the company itself could do, is not a rvant within the meaning of the provisions of this section. Hill v. Spencer, 61 N. Y., 274; Aikin v. Wasson, 24 id., 482 ; Coffin v. Reynolds, 37 id., 640. The stockholder must pay, not debts due to all employees of the company, but those due to " laborei-s, servants or employees, other than contractors," and not all debts due to them, but only such as" are due for " services performed by them for such corporation." Wakefield v. Fargo, 90 N. Y., 213. One employed at a yearly salary as a bookkeeper and general manager was held not to be a laborer, servant or apprentice within the meaning of the former act of 1848 or 1863. Individuals who occupied positions and were usually of suck capacity as enabled them to look out for themselves, were not deemed to be within the privilege of the statute. Id. A reporter employed by a newspaper company was held, in Hams v. Norvell, 1 Abb. N. C., 127. to be a laborer or servant of the company within the statute of 184S. This case also decided that a "city or assistant editor," if not an officer of the company, came within the same term. In Conant v. Van Schaick, 24, Barb., 87, it was held that a civil engineer and a rodman were included within the terms " laborers or servants," in section 10 of the general railroad act. This case made no restriction short of officers or agents of the company. A consulting engineer was held, in Ericsson v. Brown, 38 Barb., 390, not to be within the language or policy of an act which provided for the personal liability of the stockholders for debts due and owing to its "laborers and operatives fo services performed for the corporation. The word "servant" was not the act. The case of Aiken v. Wasson, 24 New York, 482, holds that a contractor construction of a railroad is not a " laborer " or " servant " within the provision* of the general railroad act. To the same effect are the cases of Bout well T. Townsend, 37 Barb., 205, and Balch v. N. Y. & 0. M. R. R. Co., 46 N. Y., 531. The latter case states that the term " laborer" in this act did not include one wno contracts for and furnishes the labor and services of others, or who contracts l 67 STOCK CORPORATION LAW. and furnishes a team or teams for work, whether with or without hia services. See Atcherson v. Troy & B. R. R. Co., 6 Abb., N. S., 329. In "Williamson v. Wadsworth, 49 Barb, 294, a civil engineer and traveling agent at a fixed salary was held to be a servant of the corporation within the meaning of section 18 of the act of 1848. It was held in Coffin v. Reynolds, 37 N. Y., 640, that the secretary of a copora- tion was not a laborer or servant of the corporation under section 18, chap. 40 of 1848. The decision was placed on the ground that the "secretary" was an officer of the company. The superintendent and attorney are not ' employees, operatives or laborers," or their earnings, " wages," within the meaning of chap. 376 of 1885. People v. Remington, 45 Hun, 329. A laborer working with his team and his nired man, at an agreed price per day, can not recover under section 12 of the general railroad act. Atcherson v. T. & B. R. R. Co., 1 Abb. Ap. Dec., 13 ; s. c., 6 Abb., N. S., 329 ; Cummings v. N. Y. & O. M. R. R. Co., 1 Lans., 68; Balch v. Same, 46 N. Y., 521. Under chap. 755 of 1873, surgeons were held not to be clerks or employees. People ex rel. Satterlee v. Board, etc., 74 N. Y., 44. The term " employees," is usually considered as embracing laborers and ser- vants and those occupying inferior positions. People ex rel. Satterlee v. Board, etc., 74 N. Y., 44. The case of Richardson v. Abendroth, 43 Barb., 162, was overruled in Coffin u. Reynolds, 37 N. Y., 640, as to the point that the secretary, in performing the ser- vices incident to the duties of his office, is a servant of the company, within the meaning and intent of the act of 1848. A foreman, who renders manual service of the same kind as that performed by the other laborers in the employ of the company as one of his principal duties and not a mere incident to his position, was held to be a laborer or servant within the meaning of section 18, of the act of 1848. Short v. Medberry, 29 Hun, 39. A secretary of a corporation is not a servant in the ordinary and usual sense in whir.h the term is used. Smith v. Long I. R. R. Co., 32 Hun, 38 ; Gurney v. A. & G. W. Ry. Co., 58 N. Y., 367 ; Coffin v. Reynolds, 37 id., 640. The term "employee," in its ordinary and usual sense, includes all whose ser- vices are rendered for another. Gurney v. A. & G. W. Ry. Co., 58 N. Y., 358. It ia not restricted to any kind of employment or service, but includes the pro- fessional man as well as the common laborer. Id. This case arose on the con- struction of an order of court appointing a receiver, and it may be that a different rule of construction would be applied in such case than in the case of a statute. In Ericsson v. Brown, 38 Barb., 390 ; .Aikin v. Wasson, 24 N. Y., 482, and Coffin v. Reynolds, 37 id., 640, there was a statute liability created against stockholders, and such statutes are always strictly construed, and in view of the supposed policy and general legislative intent indicated by the particular terms employed. In an action brought under the second clause of this section, the employee may, under chap. 257 of 1838, compromise with and release one or more, without affect- ing his right to recover the balance of his claim from the other stockholders. Hen-ies v. Platt, '21 Hun, 132. Who are not employees, etc., within this section. People v. Remington & Sons ; Matter of Ringwood (Sup. Ct., 1889), 25, 301; 25 N. Y. St. Rep., 301. An employee of the corporation, who comes within section 67, can maintain an action against one or more stockholders, subject to the conditions of section 58 and first clause of section 57 of this act, and recover against them without limitation of liability save the amount of claim, interest and costs, though the capital stock has all been paid in and the certificate duly made, filed and recorded. He can also maintain an action against the trustees under section 30, in case the annual report has not been filed, or under section 31 in case a false report has been filed. The same liability exists in this case. He may also maintain an action under the first clause of section 57, in case the capital stock has not been paid in or the certificate made, tiled and recorded. The stockholder's liability in this case is limited to the amount unpaid on, and an amount equal to, his stock. This action is subject to defense on ground of pay* ment or claim against corporation. No such defense is allowable in the other cases. If he fails to give the notice or bring the action within the required time, he is compelled to resort to one of the other remedies, if they exist, otherwise he ia without relief. The first-mentioned remedy is subject to the conditions con- 68 STOCK CORPORATION LAW. tained in section 58, the second arid third clauses of sec.in 67, and the statute of limitations of six years. The second mentioned remedy is subject to the condi- tions oi either section 30 or 31 and the statute of limitations of three years. The last mentioned remedy is subject to the conditions of the first clause of se^'inn f>7, the whole of section 58, the statute of limitations of six years, and to the defenses above named. A recovery in either proceeding, without satisfaction, is no bar to any other mode of procedure. The right of action given by this section to laborers against stockholders, is not merely a personal privilege granted to them alone, but passes on assignment, to the assignee. Krauser v. Ruckel, 17 Hun, 463; Same v. Murdoch, not reported. When ihe liability of the stockholders to the laborer has accrued and becomes fixed, there is no reason why it may not be assigned, and the assignee acquire all the right of action which accrued to the original party. Id. Th6 claim of a laborer for a corporation is assignable and, when duly assigned, the assignee takes the same with all the rights and remedies secured to the laborer by this section. Pitcher i>. Drayton, 17 Hun, 429; Krauser . Murdo- ' , not reported ; Kincaid v. Dwinelle, 59 N. Y., 548 ; Bonne 11 v. Wheeler, 1 Hun, 332. The burden is upon persons claiming preferences to bring themselves, by evidence, within the statute. People . Remington, 45 Hun, 329. The burden of proof is upon the employee, to show that t heiv is a debt due am' owing for services performed for the corporation, by a laborer, etc., within the meaning of this section. Johnson v. Underbill, 52 N. Y., 203. So, he mnr' that the person sued was, when the debt was due and owing, a stockholder of the company. Id. An action can n t be maintained by an employee of the company against t- ', without bringing in the other stockholders of the corporation. Strong v. Wheaton, 38 Barb., 016. A servant of a corporation must, to enforce the personal liability under this section, sue each stockholder separately, or join them all in one ar' ion. Dean t). Whiton, 16 Hun, 203. After bringing an action against them jointly, he can not discontinue as to one stockholder, without the consent of the others. Id. Ee ha*, by suing all of them, elected to treat them as joint debtors. Id.; Herries v. Platt, 21 Hun, 132. The stockholders, under this section, are to be considered as partners as to the lebts of the laborers, etc., for the "rporation. Clark v. Myers, 11 Hun, 608) Bailey v. Bancker. 3 Hill, 188 ; Richardson v. Abendroth, 43 Barb , 162 ; Wi.es 13. Suydam, 64 N. Y., 173. An action against a stockholder, under this section, must be brought within tw( years from the maturity of tlv; debt. Short v. Medberry, 2H Hun, 3!). A stockholder, who has paid judgments recovered against him for services performed by laborers employed by the company, can not maintain an action at law against another stockholder for contribution, but must bring a suit in equity against them all. Clark v. Myers, 11 Hun, 608. While section 54 conflicts somewhat with section 6 of the Business Corp. Law, section 55 does not apply merely to section 54, but is a general statute of limitation and therefore governs a corporation organized under the business corporation law. v Adams v. Wallace, 82 App. Div., 117. See also Lang v. Lutz, 83 App. Div., 534. In action against stockholders if judgment of dissolution is rendered it is not necessary to show judgment against corporation and return of execution unsatisfied. Lang v. Lutz, 180 N. Y. 254. Dyer v. Drueker, 108 App. Div. 238. 55. Limitation of stockholder's liability. No action shall be brought against a stockholder for any debt of the corporation until judgment therefor has been recovered against the corporation, and an execution thereon has been returned unsatisfied in whole or in part, and the amount due on such execution shall be the amount recoverable, with costs against the stockholder. No stockholder shall be personally liable for any debt of the corporation not pay- able within two years from the time it is contracted, nor unless an action for its collection shall be brought against the corporation within two years after the debt becomes due: and no action shall be brought against a stockholder after he shall have ceased to be a stockholder, for any debt of the corporation, unless brought within two years from the time he shall have ceased to be a stockholder. 69 STOCK CORPORATION LAW. Former section 58. Bee section 24, chap. 40 of 1848, and section 25, chap. 611 of 1875, now repealed. Under this section, a creditor can not bring suit against a stockholder after two years from the time he ceased to be such. Walton t>. Coe, 110 N. Y., 109. The creditor, as he can uut bring 1 suit at all until after judgment and execution against the company, is subjected to the danger that, by litigation and delay in the action against the company, his remedy against a stockholder who has ceased to be such lay be wholly lost. Id. After two years have elapsed from the maturity of a corporate debt without suit, the statutory liability of a stockholder, under this section, is completely dis- charged. See Parrott v. Colby, 6 Hun, 55 ; afTd 71 N. Y., 597. The time within which an action must be begun for the recovery of a debt owing by a corporation, so as to lay a foundation for a recovery under section 57 of this act, begins to run on the day when the debt first became due. Hardman t>. Sage, 124 N. Y., 25. A suit for the collection of the debt must be brought against the corporation within two years after it becomes due, in order to such liability, unless some cane* intervenes before the expiration of such period sufficient to excuse such action. Hardman v. Sage, 47 Hun, 230; Kincaid v. Dwindle, 59 N. Y., 548 ; Caykendall v. Corning, 88 id., 129. Where the time of the payment of a debt is extended by the taking of a promis- sory note, which is sued within two years from the date of its maturity, but more than two years after the debt becomes due, the claim of the creditor against the stockholders is lost and they can not be charged with the payment of the debt. Hardman v. Sage, 124 N. Y., 25. In Fisher v. Marvin, 47 Barb., 159, it was held that the debt was contracted when the renewal note was given, but this case was overruled on this point by Jagger Iron Co. v. Walker, 76 N. Y., 521. Where a note payable four months after day was discounted for the company, and subsequently renewed once for four months and again for five months, and upon maturity of latter renewal note, an action was brought against the company, it was held, in Veeder v. Mudgett, that it was a debt to be paid within one year from the time it was contracted, and that the suit was brought within one year after it became due, within the section 24 of the act of 1848. The fact that an action was not brought against the corporation within two years as required by this section, is matter which the defendant must plead in hit answer. Woodward v. Holland M. Co., 39 N. Y. St. Rep., 411. It is not necee- r.ry for the complaint to negative such defense. Id. In au action, under this section, to enforce the personal liability of stockholders tor debts due to the laborers of the company, the complaint must show that the debt was to have been paid within two years from the time it was contracted. . Dean v. Mace, 19 Hun, 391. In case of a]series of renewals of a note given for goods purchased, the indebted- ness against the corporation arose on the purchase, and became due on the maturity of the first note within the meaning of this section. Jagger Iron Co. v. Walker, 78 N. Y., 621. If the action against the corporation is not, in such case, brought within two years after the maturity of the first note, a stockholder is not personally liable for the debt. Id. Before a creditor of a corporation, can recover of a stockholder, under this sec- tion, the debt of the orporation to him, he must prove the existence of the debt, recovery of a judgment and the issuing and return of an execution thereon unsat- isfied. Berridge v. Abernethy, 24 W. Dig., 513 ; Richards v. Beach, 27 id., 355. A. suit against the company on notes given to secure a debt is not an action foi the collection of the debt such as last section contemplated. Griffith v. Green, 31 N. Y. St. Rep., 705. This section makes the prosecution of a suit against the company a condition precedent to the right against a stockholder. Birmingham Nat. Bk. v. Mosser, 14 Hun, 605 ; Lindsley r. Simonds, 2 Abb., N. S., 69. A proceeding in rein affecting only attached property of the corporation and _ex- ecution against that property is not a compliance with the condition of this section. Rocky M. Nat. Bk. v. Bliss, 89 N. Y., 338. Nor is the recovery of a judgment and issuing of execution in another state such compliance. Id. A judgment lit and xecution issued out of a court of this state are required. Id. 70 STOCK CORPORATION LAW, This section muat b construed aa requiring- the recovery of judgment in tb action against the company, and the return of an execution unsatisfied on auch judgment. Lindaley v. Simonds, 2 Abb., N. 8., 69. The complaint in the action against stockholders must allege judgment and execution unsatisfied. Id. Thu case was overruled in Handy v. Draper, 23 Hun, 256, on thia point, but thi.s latter case was reversed in 89 N. Y., 324. A creditor can not maintain an action against a stockholder under section 57, until he has obtained a judgment upon his claim against the corporation. And aa execution has been issued thereon and returned unsatisfied. Handy v. Draper, 89 N. Y., 334 ; Kincaid v. Dwinelle, 59 id., 548; Lindsley v. Simonds, 2 Abb., N. 8. 69 ; Dean v. Mace, 19 Hun, 391. No action can be maintained by a judgment creditor to enforce the individual liability of a stockholder in a business corporation, until execution has been issued and returned unsatisfied. Richards . Beach, 19 Abb. N. C., 84. Nor can such action be maintained for unpaid subscriptions, or on account of unpaid capital stock. Richards v. Coe, 19 Abb. N. C., 79. This section requires a judgment to have been recovered against the company in the courts of this state. Deant). Mace, 19 Hun, 391. A compliance with the condition precedent prescribed by this section is excused, when rendered legally impossible or fruitless. Shellington v. Howland, 53 N. Y., 371 ; Lovett v. Cornwell,6 Wend., 369 ; People v. Bartlett, 3 Hill, 570 ; Loomisfl. Tifft, 16 Barb., 541. Such effect is produced, where the creditor ia prevented from prosecuting- his action against the corporation to judgment and execution, either by the act of the stockholder or tho operation of a paramount statute Shellington . Howland, ante. A failure to sue the corporation within two years after the maturity of the debt, is excused by its dissolution within such two years, and will not prevent an action against a stockholder on his unpaid subscription. Arnot v. Sage, 5 N. Y. Supp., 477. A final judgment dissolving the corporation in an action brought by the people, relieves the creditor from the necessity of an attempt first to recover the debt of the corporation. Hardman v. Sage, 124 N. Y., 25 ; Shellington v. Howland, 67 Barb., 14 ; aflTd, 53 N. Y., 371 ; Kincaid v. Dwinelle, 5 J. & 3., 328 ; aflTd 59 N. Y., 548 ; Flash v. Conn., 109 U. 8., 371 ; Birmingham Nat. Bk. v. Mosser, 14 Hun, 605 ; Handy v. Draper, 89 N. Y., 335 ; Rocky M. Nat. Bk. v. Bliss, id., 338 ; Cuykendall . Corning, 88 id., 129. Whenever a stockholder shall be divested of his interest in or control over th affairs of the corporation, by actual dissolution thereof by formal judgment, or by a surrender of its corporate rights, privileges and franchises, the time begins to run, and, at the end of two years therefrom, the stockholder is no longer liable for any debt of the corporation. Hollingshead . Woodward, 107 N. Y., 96. When the organization is divested of its rights, privileges, franchises and property by virtue of the appointment of a receiver, the members cease to be stockholders within the meaning of this section. Id. ; Slee v. Bloom, 19 Johns., 456; Bradt v. Benedict, 17 N. Y., 93; Bruce t>. Platt, 80 id., 379. The case of Kincaid v. Dwinelle, 59 N. Y.. 548, was commented on and distinguished in Hollingshead t>. Woodward, 107 N. Y., 96. Proof of the debt against the corporation in bankruptcy was held, in Shelling- ton v Howland, 53 N. Y., 371, not to be a bar to an action thereon against th stockholder. It is not a sufficient excuse for a non-compliance with this section to show that within two years a petition in bankruptcy was filed by the creditor and others against the company, upon which it was adjudged a bankrupt, and in which proceedings the creditor duly proved his claim. Birmingham v. Mosser, 14 Hun, 605; Ansonia B. & C. Co. v. N. L. Co., 53 N. Y., 123; Kin- caid v. Dwinelle, 59 id., 548. Action against a stockholder of a full liability corporation organized under the business corporation law does not fall within the limitation of ten years. Adams v. Slingerland, 39 Misc., 638. See also Long Island Bottlers Union v. S. Liebman's Sons Brewing Co., 83 App. Div., 146. S 56. Increase or reduction of number of shares. The number of shares into which the capital stock of any stock corporation is divided may be increased or reduced by a two-thirds vote of all stock duly represented at a meet- ing held and conducted in like manner, and upon filing a like certificate, as required for the increase or reduction of its capital stock. If such increase or reduction of the number of shares be so authorized, the corporation shall issue to each stock- holder certificates foi as many shares of the new stock as equal in par value the shares of the old stock held by him, upon surrender Jand cancellation of such old stock. This section docs not authorize the increase or reduction of the capital stock of such corporation. Amended by ch. 354 of 1901. In effect April 16, 1901. 71 STOCK CORPORATION LAW. 57. Voluntary dissolution. Any stock corporation, except a moneyed or a railroad corporation, may be dissolved before the expiration of the time lim- ited in its certificate of incorporation or in its charter as follows: The board of directors of any such corporation may at a meeting called for that purpose upon, at least, three days' notice to each director, by a vote of a majority of the whole board, adopt a resolution that it is in their opinion advisable to dis- solve such corporation forthwith, and thereupon shall call a meeting of the stockholders for the purpose of voting upon a proposition that such corpora- tion be forthwith dissolved. Such meeting of the stockholders shall be held, no* less than thirty nor more than sixty days after the adoption of such reso- lution, and the notice of the time and place of such meeting so called by the directors shall be published in one or more newspapers published and circulating in the county wherein such corporation has its principal office, at least once a week for three weeks successively next preceding the time appointed for hold- ing such meeting, and on or before the day of the first publication of such notice, a copy thereof shall be served personally on each stockholder, or mailed to him at his last-known post-office address. Such meeting shall be held in the city, town or village In which the last preceding annual meeting of the corporation was held, and said meeting may, on the day so appointed, by the consent of a majority in interest of the stockholders present, be adjourned from time to time, and notice of such adjournment shall be published in the newspapers in -which the notice of the meeting is published. If at any such meeting the holders of two-thirds in amount of the stock of the corporation, then outstanding, shall, in person or by attorney, consent that Buch dissolution shall take place and signify such consent, in writing, then, such corporation shall file such consent, attested by its secretary or treasurer, and its president or vice president, together with the powers of attorney signed by such stockholders executing such consent by attorney, with a statement of the names and residences of the then existing board of directors of said corporation, and the names and residences of its officers duly verified by the secretary or treasurer or president of said corporation, in the office of the secretary of state. The secretary of state shall thereupon issue to such corporation, in duplicate, a certificate of the filing of such papers and that it apppears therefrom that such corporation has complied with this section in order to be dissolved, and one of such duplicate certificates shall be filed by such corporation in the office of the clerk of the county in which such corporation has its principal office ; and thereupon such corporation shall be dissolved and shall cease to carry on business, except for the purpose of adjusting and winding up its business. The board of directors shall cause a copy of such certificate to be Sublished at least once a week for two weeks in one or more newspapers pub shed and circulating in the county in which the principal office of such corpo ration is located, and at the expiration of such publication, the said corporation by its board of directors shall proceed to adjust and wind up its business and affairs with power to carry out its contracts and to sell its assets a.*- public or private sale, and to apply the same in discharge of debts and obligations of such corporation, and. after paying and adequately providing for the payment of such debts and obligations, to distribute the balance of assets among the stockholder* of said corporation, according to their respective rights and interest. 8aii* corporation shall nevertheless continue in existence for the purpose of paying, satisfying and discharging any existing debts or obligations, collecting and distributing its assets ana doing all other acts required in order to adjust and wind up its business and affairs, and may sue and be sued for the purpose of enforcing such debts or obligations, until its business and affairs are fully adjusted and wound up. After paying or adequately providing for the debts and obligations of the corporation the directors may, with the written consent of the holders of two- thirds in amount of the capital stock, sell the remaining assets or any part thereof to a corporation organized under the laws of this or any other state, and engaged in a business of the same general character, and take in payment therefor the stock or bonds or both of such cprporation and distribute them among the stockholders, in lieu of money, in proportion to their interest therein, 7la STOCK CoRFOUATioN LAW. but 110 such sale 6ha.ll be valid as against any stockholder, who, within sixty days after the mailing of notice to him of such sale shall apply to the supreme court in the manner provided by section thirty-three of this act, lor an appraisal of the value of his interest in the assets so sold ; unless within thirtv days after such appraisal the stockholders consenting to such sale, or some of them, shall pay to sucli objecting stockholder or deposit for his account in the manner directed by the court, the amount of such appraisal and upon such payment or deposit the interest of such objecting stockholder shall yest in the person or persons making such payment or deposit. Added by chap. 932 of 1896. Amended by chap. 760 of 1900. In effect May 4, 1900. 58. Merger. Any domestic stock corporation and any foreign stock corpo- ration authorized to do business in this state lawfully owning all the stock of jiny other stock corporation organized for, or engaged in business similar or incidental to that of the possessor corporation may file in the office of the secretary of state, under its common seal, a certificate of such ownership, and of the resolution of its board of directors to merge such other corporation, and thereupon it shall acqu re and become, and be possessed of all the estate property, rights, privileges and franchises of such other corporation, and they shall vest in and be held and enjoyed by it as fully and entirely and without change or diminution as the same were before held and enjoyed by such other corporation and be managed and controlled by the board of directors of such possessor corporation, and in its name, but without prejudice to any liabilities of such other corporation or the rights of any creditors thereof. Any bridge corporation may be merged under this sec- tion with any railroad corporation wlu'ch shall have acquired the right by contract lo run its cars over the bridge of such bridge corporation Added by chap. 932 of 1896. Amended by chap. 476 of 1900. In effect April 17, 1900. Amended by chap. 98 of 1902. In effect March 6, 1903. 59. Change of place of business. Any stock corporation now existing or hereafter organized under the laws of this state, except rnonied corporations, may at any time change its principal office and place of business from the city, town or county named in its certificate of incorporation, or to which it may have been changed under the provisions of this section, to any other city, town or county in this state, in which it may desire to actually transact and carry on its regular business from day to day, provided, and Buch change has been authorized, either by unanimous consent of the stockholders expressed in \vriting and duly acknowledged and filed in the office of the secretary of state, or by a vote of the stockholders of said corporation at a special meeting of stockholders called for that purpose. When such change shall be authorized by the stockholders as herein provided, the president and secretary and a majority of the directors of such corporation shall sign a certificate stating the name of said corporation, the city, town and county where its principal ofilce and place of business was originally located, and to which it may have been subsequently changed, and the city, town and county to which it is desired to change its said principal office and place of'business, and that it is the pur- pose of said corporation to actually transact and carry on its regular business from day to day at such place, and that such change has been authorized as herein provided, and the names of the directors of said corporation and their respective places of residence, which certificate shall be verified by the oaths of all the persons signing the same, and when so signed and verified, shall be filed in the office of the secretary of state and a duplicate thereof in the office of the clerk of the county from which said principal office and place of business is about to be removed or changed, and another in the office of the clerk of the county to which said removal or change is to be made, and thereupon the prin- cipal office and place of business of such corporation shall be changed as stated in said certificate. Added by ch. of 1896. In effect June 16, 1896. Amended by ch. 489 of 1905. 7!b STOCK CORPORATION LAW. 60. Liabilities of officers, directors and stockholders of for- eign corporations. Except as otherwise provided in this chapter the officers, directors and stockholders of a foreign stock corporation trans- acting business in this state, except moneyed and railroad corporations, shall be liable under the provisions of this chapter, in the same man- ner and to the same extent as the officers, directors and stockholders of a domestic corporation, for: 1. The making of unauthorized dividends; 2. TJie creation of unauthorized and excessive indebtedness; 3. Unlawful loans to stockholders; 4. Making false certificates, reports or public notices; 5. An illegal transfer of the stock and property of such corporation, when it is insolvent or its insolvency is threatened; 6. The failure to file an annual report. Such liabilities may be enforced in the courts of this state, in the same manner as similar liabilities imposed by law upon the officers, directors and stockholders of domestic corporations. A New Jersey Corporation transacting business in New York, may sue in New "iork to recover from its directors capital divided among its stockholders in dividends. Hutchinson v. Stadler, 80 App. Div., 424. Added, ch. 384 of 1897. 61. Dissolution by incorporators. The incorporators named in any certificate of incorporation filed for the purpose of creating a domestic stock corporation, other than a moneyed or transportation corporation, may, before the payment of any part of the capital, and before beginning business, surrender all corporate rights and fran- chises, by signing, verifying and filing in the office of the secretary of state and the clerk of the county where the certificate of incorporation is filed, a certificate setting forth that no part of the capital has been paid, that there are no liabilities, that such business has not been begun, and surrendering all rights and franchises; and proof of the facts set forth in such certificate to the satisfaction of the secretary of state; and thereupon the said corporation shall be dissolved, and its corporate existence and powers shall cease. Added by ch. 296 of 1904. In effect April 13, 1904. 62. Partly paid stock. The original or the amended certificate of incorporation of any stock corporation may contain a provision expressly authorizing the issue of the whole or of any part of the capital stock as partly paid stock, subject to calls thereon until the whole thereof shall have been paid in. In such case, if in or upon the certificate issued to represent such stock, the amount paid thereon shall be specified, the holder thereof shall not be subject to any lia- bility except for the payment to the corporation of the amount re- maining unpaid upon such stock, and for the payment of indebted- ness to employes pursuant to sections fifty-four and fifty-five of this chapter; and in any such case, the corporation may declare and may pay dividends upon the basis of the amount actually paid upon the respective shares of stock instead of upon the par value thereof. Added by ch. 854 of 1901. In effect April 16, 1901. 71c By the provisions of chap. 564 of 1890, the original Stock Corporation Law, the following laws were repealed. SCHEDULE OP LAWS REPEALED. Revised Statu Revised Statu Part I, chapter 18, title 3 Section 6. Part I, chapter 18, title 4 All except ejec- tion 5 and 6. Laws of Chapter. SECTIONS. 1811 67 3, 5, 7. 1822 213 "> "> All. 1842 165 All. 1847 210 38, 39, 40, 41, 43, 44, 46, 61. 1847 405 All. 1848 37 3, 5, 6, 8, 10, 11, 12,13, 14, 16, 16, Tff 20, 21, 22. 1848 40 3, 5, 6, 8, 10, 11, 12, 13, 14, 16, 16, K 18, 19, 20, 21, 22, 23, 24, 25, 27. 1848 269 2, 5, 12, 13, 16. 1848 265 8,10. 1850 140 4,5,7,8,9,10,11,48. 1852 228 3 to 14 both inclusive. 1853 117 3, 5, 6, 8, 10 to 25 both inclusive. 1863 135 3, 4, 6, 7, 8, 9, 10, 14, 15, 16, 17. 1853 333 2. 1853 395 All of section 6 to and including th word "trustees" in line 7. 1863 502 All. 1854 232 3, 5, 6, 8, 10, 11, 12, 13, 14, 15, 16, 17 C 18, 19, 20, 21, 22, 24, 25, 27, 28. 1855 425 First and last sentences of section 5. 1857 546 3, 5, 6, 8 and 11 to 20 both inclusive. 1857 776 7. 1860 269 All. 1861 149 2, 5, 6, 7, 9. 1863 134 All. 1864 517 2. 1866 73 All. 1867 419 2. 1867 480 All. 1867 971 First two sentences of 6, and 6, 7, 8. 1867 974 4 to 11 both inclusive. 1868 290 All. 1870 773 All. 1872 tiQo 3, last three sentences of 4, and 7, 8, 9, 10. 18721 146 All. SCHEDULE OF- LAWS REPEALED (Continued.) Laws of Chapter SECTIONS. 1872 611 All. 1872 820 4, 9, 10, 13, 14, 15. 1873 151 All. 1873 469 All but section 5. 1873 737 7,8. 1874 143 3, 5, 6, 8, 10, 11, 13, 14, 17. 1874 288 4. 1874 430 All. 1875 4 All. 1875 343 .- 9. 1875 606 10 to 15 both inclusive. 1875 611 5, 10, 11, 12, 13 to 26 both inclusive and 28, 29. 1S77 228 3, 4, 5. 1878 163 1. 1878 203 4, 5, 6, 7, 8, 9, 10, 11, 12, 39, 43, 44. 1878 264 All. 1879 393 All. 1879 395 All. 1879 413 All. 1880 155 All. 1880 182 1. 18K..^ 225 All. 1880 510 All. 1881 468 4, 7, 8, 10, 11. 11 1881 509 1. 1884 252 19. 1884 397 All. 1885 141 All. 1885 171 All. 1885 489 All except section 2. 1886 586 AIL 1888 293 3. 1888 462 3, 4, 5. STOCK CORPORATION LAW. No. 1. Section 3 of Stock Corporation Law. Form of oartifloat* of incorporation. STATE OF NEW YORK, ) County of , j M> We, the undersigned, do, in conformity with the provisions of section 8 of the Stock Corporation law, hereby certify to the following matters : The property and franchises of the , a domestic corporation, organized under chap. of the laws of , were duly sold, on the day of , 18 , by virtue of a judgment of the court of this state, dated and entered in the office of the clerk of the county of , on the day of , 18 . The property, sold as above stated, is described as follows: (Here give brief description.) At euch sale, the said property was purchased by , who desire to become a corporation, and have associated with themselves the following persons, a majority of whom are citizens and residents of this state, and all unite with the purchasers in this certificate. (Here ^insert names.) ^ The name of the corporation intended to be formed by the filing of this certificate is (state name). The maximum amount of its capital stock is (state amount of capital tock), and the number of shares into which the same is to be divided IB (give number), of which shares are to be common stock, and shares are to be preferred stock. The rights pertaining to each class shall be as follows: (Here particularly describe such rights.) The number of directors^who shall manage the affairs of the new corporation for the first year, and their names and post-office addrea* are as follows : JNames. Post-office address. The following plan or agreement was entered into at or previous to the time of such sale, in anticipation of the formation of a new corporation, and the purchase was made pursuant to it : (Here insert plan or agreement, if any.) In witness whereof, we, the said purchasers, and their associates (if any), have hereto set our hands, this day of , 18 . (Signatures.) (Add acknowledgment clause as in No. 1 of General Corporation Law.) See subd. I of section 8. p. . 74 STOCK CORPOKATIOW LA.W FOBMI. No. 2. Station 21 of Stock Corporation Law. Form qf certified transcript of (Ac minufai, etc. : STA.TB or Nw YORK, ) County of , / We, the undersigned, president and secretary, do hereby certify that the following is a correct transcript of the minutes of a meeting of stockholders of the , held pursuant to article 2 section 21 of the stock corporation law, to wit : , N, Y. , 18. A special meeting of the stockholders of the was held this day at o'clock M. to determine whether the number of direc- tors shall be increased (or reduced). Such meeting was held at the office of the company, the usual place of meeting of its directors, on two weeks' notice in writing to each stockholder of record ; such notice having been served person- ally, or by mail, postage prepaid, directed to each stockholder at his last known post office addres. The following is a true copy of said notice : "Notice to Stockholders. , N. Y. , 18. Notice IB hereby given that a special meeting of the stockholders of the will be held at the office of the company at No. st. in the , N. Y., on the day of , 18 , at o'clock M. of that day, to determine whether the number of its directors hall be increased (or reduced, as the case may be). Secretary of . M Proof of service of said was duly filed in the office of the corpora- tion at or before the time of such meeting. At the time and place mentioned in such notice, the meeting was held pursuant thereto, and duly organized by choosing , presi- dent, and , secretary thereof. The following resolution was duly moved by and duly econded by and adopted on a vote taken by ayes and noes : " Resolved, that the number of directors of the be increased (or reduced, as the case may be), from , the present number, to ." The following stockholders, owning the number of shares of stock set opposite their respective names, voted in favor of such resolution, to wit: Naxnea. Number of share*. STOCK CORPORATION LAW Fo The following shareholders, owning the number of shares of et opposite their respective names, votd against its adoption, to wit : Names Number of share* (If none voted against its passage, then state in place of last cli No stockholder voted against its adoption.. Said resolution was thereupon declared duly adopted, and the meet- Ing adjourned. In witness whereof, we hare made, subscribed and verified the fore- going certificate, this day of , 18 . , Prwvfrm. , toontary. BTATB OF NBW YORK, ) County of , J aud , being severally duly sworn, does, each for him' self, say, that they are the persons chosen president and secretary, respectively, of the meeting of stockholders of the , held at the time and place above mentioned, to determine whether the number of directors thereof shall be increased (or reduced, as the case may be) ; that the foregoing is a correct transcript of the proceedings of sucb meeting, as entered in the minutes of the corporation, and the whob thereof. (Jurat.) . A form for the notice of such special meeting \* found in the fore- going form. No. 3. faction 28 of Stock Corporation Low. Form STOCK CORPORATION LA.W FORMS. No. 4 Form of Cortijlcatt of Intpecton. STATB OF NBW YORK, County of We, the inspectors of election of , duly appointed to act at the annual meeting of the stockholders of such corporation, do hereby certify aa follows, to wit : Such meeting was held at the office of the company on the day of , 18 , at o'clock, in the noon of that day. Before entering \ipon the discharge of our duties, we subscribed and took the required oath, which is hereto annexed, marked "Ex. A," and hereby made a part of this certificate. At such meeting, the election of directors to manage the affairs for the ensuing year was held. It was found, upon a canvass of the votes cast at such election, that votes, representing shares of the capital stock, had been cast, as follows : For , of , votea _ <( Whereupon the said , , , , and , were declared by us duly elected directors of such corporation for the ensuing year. In witness whereof, we have signed and acknowledged this certifi- cate, this day of , 1& . (Jurat.) , Inspector*. Acknowledgment clause aa in No. 1 of General Corporation Law. No. 6. Section 80, Annual Report. STATB OF NBW YORK, ) Albany City and County, f The Jones Manufacturing Company of Albany, N. Y., hereby^ makes its annual report as of the 1st day of January, 18 . 1. The capital stock of said company is $ , all of which is issued (if not all issued state the proportion actually issued). 77 STOCK CORPORATION LAW FORKS. 2. The amount of its debts does not exceed the sum of (insert amount) dollars. 8. The amount of its asset* is at least the sum of (insert amount) dollars. 4. The amount of its stock issued for property purchased is (in- sert amount) dollars. (After the sheets containing the statements above referred to, here is to be added). This report, made by said corporation, is signed by its president or vice-president, as the case may be. Dated ALBANY, January , 18 k (Signed) JOHN JONES, ( President- i Sworn to before me this ) day of January, 18 , / SARAH DOE, Notary Publie, Albany Co. No. 6. Section 40 of Stock Corporation Law. Form of certificate of stock. No. . No. of shares . Par value of each $ . The Company. This is to certify that is the owner of shares of the capital stock of the company, transferable only on the books of the company by the holder thereof, in person or by attorney, on the surrender of this certificate. In witness whereof, the said company has caused its corporate seal to be affixed hereto and this certificate to be signed by its president and treasurer. . Y. , 18. PreridmL 78 STOCK COHFORATIOW LAW FORMS. On back of the certificate, a blank transfer, in following form, should be printed. For value received, hereby sell, assign and transfer unto shares of the within mentioned stock, and do hereby constitute and appoint attorney to transfer the same on the books of th company. Witness my hand and seal, this day of , 18. Witness : (Seal.) No, 7. Section 44, et $eq. Form of certificate. SVATB of NBW YORK, "I ^ County of , J We, , chairman, and , secretary, of a special meeting of the stockholders of the , * a domestic corporation, held fof the purpose of increasing (or reducing, as the case may be), its capital stock, do hereby certify : A notice of such meeting, of which the following is a true copy, wa published once a week,f for at least two successive weeks, in , a newspaper in the county, where its principal business office is located, and a copy of such notice was served personally upon, or duly mailed, postage prepaid, to each stockholder or member of the company, at his post-office address at least two weeks before the meet, ing. [or, That a copy of such notice was personally served at least five days before such meeting upon the following named stock, holders :] Notice to Stockholders. A special meeting of the stockholders of the will be held, on day of , 18 at o'clock M. at its office, at No. sL in the of N. Y., for ihe purpose of voting upon a proposition \ to increase (or decrease, as the case may be) its capital stock from dollars, consisting of shares of the par value of dollars each, to dollars, to consist of shares of the par value of dollars each. Dated, etc. Directors owning at least a majority of stock." At tbe time and place named in such notice, stockholders of such ooupauy, representing at least a majority of all its shares of stock, appeared in person or by proxy, and organized by choosing, from their number, the undersigned , as chairman, and , a* n STOCK CORPORATION LAW FORMS. A vote of those present, in person or by proxy, was taken upon the Following resolution : " Resolved, that the capital stock of be in- creased (or reduced, as the case may be), from its present amount of dollars, consisting of shares of the par value of - dollars each, to dollars, to consist of shares of the par value of dollars each. " Stockholders, owning shares of stock, being at least a major- ity of the stock of the company, voted in favor of such resolution^ Stockholders, owning shares of stock, voted against its adop. tion. (In case of no opposing vote, then substitute for the last clause the following :) And no stockholder voted against ittfadoption. Such resolution was thereupon declared duly adopted. The amount of capital of the corporation actually paid in is dollars. The whole amount of its debts and liabilities is dollars. The amount of the increased (or reduced, as the case may be) capital stock is dollars. In witness whereof, we have made, subscribed, acknowledged and verified this certificate, this day of , 18 . (Add acknowledgment clause as in No. 1 of General Corporation Law.) STATB or NBW YORK, ) County of , J , chairman, and , secretary of the said meeting, being severally duly sworn, does each for himself say that he has read the foregoing certificate, subscribed by him, and knows the contents thereof, and that the same is true. (Jurat.) Form of proof to obtain Comptroller's approval. STATH OP NBW YORK, ) gg County of , / , secretary, and , treasurer of , being severally duly sworn, does each for himself say that the said is secretary, and the said is treasurer of ; that a capital of dollars is sufficient for the proper purposes of the corporation, and is in excess of its debts and liabilities, and that the actual market value of the stock before reduction was lees than its par value. (Jurat) STOCK CORPORATION LAW FORMS. No. 8. Section 54. Certificate as to Payment of Capital Stock. BTATB OP NBW YORK, Albany City and County, J We, the president and a majority of the directors of the Jonas Manufacturing Company, a corporation duly organized under the " Business Corporation Law," of New York, and located and doing business at Albany N. Y., - hereby certify, - that the whole amount of capital stock of said corporation has been paid in. Dated, ALBANY, , 189 . (Signed) JOHN JONBS, President, RICHARD ROB, JOHN DOB, THOMAS ROB, Direotors. STATB OF NBW YORK, \ County of , ) John Jones, Richard Roe, John Doe and Thomas Roe, being sev- erally duly sworn, does each for himself say, that the said John Jones Ls the president of the Jones Manufacturing Company, and the said Richard Roe, John Doe and Thomas Roe are directors of said com- pany, and a majority thereof ; that he has read the foregoing certifl- cate, subscribed by him and knows the contents thereof, and that th same IB true. (Jurat.) (Add acknowledgment clause as in No. 1 of General Corporation Law.; 81 INDEX: A. SECTION. Action against company within what time brought, to hold stockholder.. 55 to invalidate mortgage for insufficiency of consent of stockholders. 8 for making false statement in annual report, limitation 31 Affairs of corporation statement of, by treasurer 52 time of making may be extended by court 5:1 Administrator, when not liable as stockholder 54 Agents, directors to appoint 27 approval of assumption of debts by, on reorganization 4 Agreement for reorganization, plan of 4 Alteration or extension of business 32 Amended certificate, for extension, etc., of business 32 Amended certificate, for purchase or exchange of stock, etc., of other cor- poration ...- 40 Annual report of stock corporation, provisions covering 30 waiver by creditor for failure to file 34 notice of intention to hold director or officer liable for failure to file 34 stock issued for property, report to so state 42 Application to replace lost stock certificate 50, 5J to supreme court for appraisers to appraise stock 33 Appraisers of stock of owner who opposed sale, appointment of 33 manner of appraisers procedure 33 Assets, annual report to state final distribution of on dissolution 2J Assignment by banking, insurance and railroad corporations forbidden ... 48 Authorities of city, town or village holding stock, may consent to re- organization Banking cos., conveyance, etc., by restricted 43 increase or reduction of capital, liabilities 44 not to make assignment 48 Banks, consent of superintendent to change number of directors 21 Bondholders, proxy votes by, on reorganization 83 INDEX. SECTION Bonds, consideration for issue of limited 43 may- be issued according to plan of reorganization 4 etc., of corporations, may be purchased by each other 40 etc., proportion to capital stock 2 4 of domestic corporation, other corporation may guarantee 40 to be issued for fair market value 42 unauthorized, directors liable 24 Books, neglect or refusal concerning, penalties for 29 opening of, for subscription to stock 41 stock book to be kept in this state by foreign corporation 53 to be kept for corporation 29 Borrowing money, power to Business, alteration or extension of, amended certificate 32 By-laws, failure to adopt, when acts of first year directors void 22 C. Cancellation of forfeited stock 43 Canceled stock, to be deducted from capital 4;} Capital, payment as dividend, forbidden 23 Capital stock, annual report to state 30 increase or reduction of 44 indebtedness limited by 24 limit on reorganization ". 4 meeting to increase or reduce, notice of 40 proportion of indebtedness to 2 reduction of, when forbidden 23 return of after reduction 45 subscription to 41 to be made good after cancellation 43 Certificate by director to relieve from liability for failure to file annual report 30 of stockholders consent to mortgage 2 if false, officers etc., when liable to creditors etc 31 surrendering corporate rights contents of 61 of partly paid stock, provision for 62 for reorganization, contents of 3 of increase or reduction of stock 46 of reduction to be approved by comptroller 40 to provide for common and preferred stock 47 of stock, contents of 40 lost or destroyed, new issue in place of 50, 51 Change of number of directors, proceedings in to be filed 21 Change of place of business 50 City authorities, assent of, to reorganization 6 Common stock, in reorganization 4 and preferred stock may be issued 47 issue of 47 Competition, prevention of, forbidden 7 84 INDEX. SECTION Comptroller, approval of reduction of capital stock 4 Default in payment of installment due for stock 4:: Destroyed stock, reissue in place of 50, . Directors, acts of, whom void 22 ceasing to be stockholder 20 policy holders of insurance corporation eligible.. changing number of * consent of to convert debt secured by mortgage into stock . . 2 holding over unlawfully, when acts void election of, time and place fixed by by-laws plurality of votes required notice of election, how given 20 85 INDEX. SECTIO.X Directors liability for failure to file annual report '> liability for false reports, etc -SI liability for illegal loans 2 j liability for unauthorized debts 24 waiver hy creditor of liability of director 34 notice of intention to hold, personally liable 34 liability of, for unlawful transfers, etc 48 may appoint officers, etc -~ may refuse consent to transfer stock _'J may extend business by filing amended certificate ;!- of stock corporation, one-fourth to be elected annually -*) of stock corporation, selection of 20 must be a stockholder unless otherwise provided by certificate or by-laws 20 indebtedness limited by 24 unauthorized dividend by, liability for '2.3 when can not act as election inspectors 28 and officers, general provisions as to 20, 32 to meet to increase or reduce stock 4"> Discounts, for stockholders forbidden 23 Dissolution, distributing assets after 23 by incorporators 61 voluntary 57 Distribution, final, of assets 23 Dividends, confined to surplus profits 23 on partly paid stock G2 unauthorized, directors liable for 23 " by foreign corporation, unauthorized, liability for 60 preferences in payment of 4 Duties of officers, etc., how prescribed , 27 E. Election, inspectors of, provisions governing 28 of directors, notice to be given 2'J failure to hold for want of by-laws holding over, acts void. .. 22 result of, certificate to be filed 28 unlawful hindrances to an 22 Employes, directors may appoint 27 Employes' wages, liability of stockholders for 5 ! Evidence, recital in mortgage when conclusive and when presumptive evidence of authority of stockholders 8 Exchange of, preferred for common stock -17 of stock by municipality on reorganization 6 of stuck, etc., by corporations with each other 40 Executors, when liable as stockholders 54 Exhibition of books by transfer agent of foreign corporation .1 ' Extension of business by filing amended certificate 3- Expenses of appraising certain stock on sale of franchise and property.. 33 86 INDEX. F. SECTION False certificates, liability of officers for 31 public notices, liability of officers for 31 reports, liability of officers for 3 J Filing certificate of stockholders consent to mortgage "2 false certificate 31 by directors, certificate to relieve from liability for failure to file annual report 30 certificate of extension of business 32 of common and preferred stock 47 of change of principal place of business 59 Final distribution of assets 23 Financial statement to stockholders 3'2 time of making may be extended by court ">2 Foreclosure, payment of mortgage debt by stockholders 4!t for failure to pay principal of mortgage or interest H Foreign corporation, exhibition of books by transfer agent of 53 purchase by, of property of domestic corporation . . 33 must keep stock book in this state 53 Forfeit of fifty dollars per day for neglect to file annual report 36 Forfeiture of stock for non-payment of subscription 43 Franchises, may be mortgaged 2 sale of on judgment, reorganization 3 sale of and property, consent of stockholders 33 Full paid stock issued for property, etc., purchased 42 G. General powers of stock corporations 1> " Guaranteeing bonds of another corporation, vote of directors Guardians, when liable as stockholders 54 I. Illegal issues of bonds, etc., directors' liability 24 transfer of stock, etc., of foreign corporation loans, directors liable for Increase of capital stock to meet mortgage debt converted . . or reduction of capital stock notice of meeting for of, not authorized in exchange of preferred for common stock. . Insolvent corporation, preferences by, forbidden . . transfer of property to officers, etc., forbidden . . corporations under banking, insurance and railroad law shall not assign Inspection of stock book of foreign corporation, in this state... Inspectors of election, provisions governing 87 INDEX. SECTION Inspectors directors or officers not eligible 2S Insurance corporations, policy holders as officers 27 not to make assignment <*S policy holders eligible as directors 20 reduction of capital stock 4-1 Insurance, consent of superintendent, to change number of directors.... 21 Interest on mortgage, default in payment, foreclosure 5 Issue of stock 40 J. Judgment creditors, access by, to stock book 29 Judgment, etc., must be obtained on debt, before suit against stockholder. 5o L. Laborers, stockholders liable for debts due 54 Liabilities of corporation, in case of increase or reduction of capital stock 44 Liability for damages, for failure, etc., to keep, etc., books 2D of directors, for failure to file annual report 30, 31 of foreign corporations 60 of officers, for false certificates, etc 31 of foreign corporations 60 of directors, for illegal loans to stockholders 25 for excessive debts, waiver by creditor , 34 notice by creditor of intention to hold director liable 34 for unauthorized bonds, etc 24 for unauthorized dividend 2tf of director, for unlawful transfers, etc 48 of owner, after increase or reduction of capital stock 44 of stockholder, limitation of 55 of holders of stock not fully paid .1 ....,.,. 54 of foreign corporations , 60 Limit on account of obligations issued , 2 of indebtedness of stock corporation .. 24 on consideration for issue of stocks, etc 42 Limitation of action for false report ,.. 31 of action for stockholders' liability .......,, 65 of stockholders' liability , . . . , 6/5 Loans, illegal, directors, liable for 25 to stockholders by foreign corporation, liability for ...,., 60 Loss caused by unauthorized dividends, directors liable for 23 dividend, directors liable for 25 Lost certificate of stock, replacing 50, 51 M. Meeting to increase or reduce stock 46 to consent to mortgage 2 Merger 5S 88 INDEX. SECTION Monied corporations, article one not to apply to 1 Monopolies prohibited 7 Mortgage debt, payment by stockholder 4y recital in mortgage of consent of stockholders, when conclusive and when presumptive evidence 8 of property, power to 2 sale of rights and franchises 5 when consent of stockholders necessary 2 Municipality stockholder may consent to readjustment and formation of new corporation 6 may exchange stock 8 N. Necessaries of life, combinations affecting, when forbidden 7 Neglect to make proper entries on books, penalties for 29 to keep books and to open them for inspection, penalty 29 New corporation, when liable for acts of receiver of old corporation .... 5 Note, discounting in payment of installment due on stock, directors liable 25 Notice of election of directors to be given 20 of meeting to increase or reduce capital stock 45 to guarantee bonds of another corporation 40 of proposal to change number of directors Zl o. Oaths of inspectors of election 28 Obligations for money borrowed, may issue , . . 2 Officers, etc., transfers to prohibited 48 of corporation holding other corporation stock, eligible as officers therein 40 liability for false certificates, etc 31 liability for illegal loans 25 waiver by creditor of liability of officer for debts 3-1 notice by creditor of intention to hold officer liable for debts . . 34 of foreign corporations, liability of 60 what may be appointed 27 may be required to give security for performance of duty 27 Owner of stock see stockholder, not relieved from liability by reduction of stock 44 P. Partly paid 'stock, authorized in certificate 82 Payment, refusal of on notes, etc., property not to be transferred to officers, etc 48 for stock on subscription in part 41 for stock must be in money, labor or property 42 for stock, time of payment 43 89 INDEX. SECTION Payment, forfeiture of, for non-payment 43 for laborers wages, preferred 48 Penalty for failure to keep books or give access to 29 for failure to make the proper entry in books 29 for failure to file annual report 30 for false report, etc., by officers, etc 31 for neglect, etc., of agent of foreign corporation 33 for neglect to furnish financial statement, etc 52 Personal liability of directors 23, 24, 25, 48 of directors for unlawful transfers, preferences, etc.. 43 of stockholders for debts 54 Place of business, change of 5! Plan of reorganization, contents of 4 to be filed, etc 3 Policyholders, eligible as officers of insurance corporation 27 of insurance corporation eligible as directors 20 Powers of stock corporation to borrow and mortgage 2 Powers of reorganized corporation 4 Preferences by insolvent corporation forbidden 48 for laborers wages before other claims 48 on payment of dividends 4 may be established by trustees or agents in favor of any por- tion of capital stock on reorganization .' 4 Preferred creditor, when to account 48 stock, on reorganization 4 stock, issues of 47 President, directors to appoint 27 Principal of mortgage, non-payment of, sale for default 5 office, change of place of 5!) Proceedings of stockholders, on extension, etc., of business to be filed. .. . 32 to increase or decrease number of directors 21 Prohibited transfer to officers or stockholders 4S I'lv.perty. franchises, rights, privileges, etc., may be sold 33 purchase of for stock 42 Public notice of condition of corporation, if false, officers, etc., iiab'o ;;l Purchaser in good faith, when protected 4,S on foreclosure, reorganization 3 Purchase mortgage, when limit does not apply 2 of stock of one corporation by another corporation 40 of property, payment for in stock 4i! Q. Qualification of directors 20 of inspectors of election 23 of persons as reorganizes 3 00 INDEX. B. SECIIOJT Railroad, increase or decrease of capital stock 44, 46 approval of railroad commissioners required 46 Readjustment of corporations, consent of municipality of interests of creditors etc., on sale of franchise 4 Receiver, reorganization not to affect 3 misconduct of liability 5 restrictions as to suits against 5 to collect stock subscriptions 43 Reduction of capital stock 44, 56 amount of debts not to exceed reduced capital and other assets 44 notice of meeting for 45 certificate of, to be approved by comptroller 45 of capital stock, when forbidden 23 Refusal to keep books and afford access to, penalty for 29 to pay its notes or obligations, property not to be transferred to officers, etc 48 Re-issue of forfeited stock 43 Removal of officers and employes, by directors 27 Reorganized corporation, power of 4 Reorganization, after sale on judgment, etc 3 liability of, for receiver's acts 5 stockholder may assent to 6 Report, annual, provisions as to 30, 60 stock issued for property, report to show 42 by foreign corporation, liability for when false 60 Restraint of trade, forbidden 7 Rights and liabilities on stock and of stockholders 40, o~> s. Sale of franchise and property of stock corporation 33 on readjustment 4 of rights and franchises under mortgage 5 Secretary, directors to appoint 27 Security may be required of officers and employes 27 - Services, liability of stockholder for 54 Shares of stock, non-transferrable until all calls paid 40 Statement, financial, to stockholders 52 time of making and extension thereof 52 Stock, etc., of corporations may be purchased by each other 40 of reorganized corporation, not to exceed maximum amount men- tioned in certificate of incorporation 4r exchange of by municipality, or reorganization 6 issued for property, reports to so state 42 consideration for issue of, limited 42 preferred and common on reorganization, and otherwise 4, 47 91 INDEX. SECTION Stock, voting on may be regulated on reorganization 4 acceptance of, for settlement of debt to company 23 subscription to, books of 41 ten per centum of amount payable 41 issued for property purchased 42 re-issue of, if forfeited for non-payment 43 cancellation of, if not sold for par 43 division of, into classes on sale of franchise J unpaid, liability of holders of, to creditors 51 partly paid, provision for issuing , 62 forfeiture of 4;5 increase or reduction of capital 44 issue and transfer of 40 to be signed by president etc., and sealed 40 lost or destroyed certificate of, issue in place of 50, 51 not to be issued less than par value 40 reissue of forfeited 43 subscriptions to 41 time of payment of subscription to 41, 45 transfer entry necessary to relieve owner of 2'.* transfer of by stockholder indebted, etc 26 no share shall be transferred until previous calls paid 40 of stock one corporation to another corporation 40 book, contents of, etc : 2t> book, where and when open 26 of foreign corporation, stock book to be open to stockholders .... 53 corporation, annual report of 39 corporation, combination of forbidden 7 corporation, limit of indebtedness of 24 may sell franchise, property etc 33 corporation, powers of 2 Stockholders, access by to stock-book 29 authorization of, to extend business 32 owner of, not relieved from liability by reduction 41 may inspect stock book of foreign corporation 53 liability of, to creditors unpaid stock 54 liability of, to laborers, etc., for services 54 executor, etc., not personally liable as stockholder 54 not liable for debt not payable in two years 55 of foreign corporation, liability of 60 consent of to mortgage 2 recital in mortgage presumptive evidence 3 insufficiency of consent, how tested 8 damaged by false report, etc., officers liable 31 evidence of debt of, not to be received by stock corporation. 25 liability, limitation of 55 loans to, forbidden 25 personal liability of, for debts 54 shall not assign stock in contemplation of insolvency of company , 4S 92 INDEX. SECTION. Stockholdeas to vote an extension of business transfer to, prohibited 43 when liability ceases 35 when may assent to reorganization g Subrogation of stockholder on payment of mortgage debt 44) of director or officer who pays corporation 34 debt, to rights of creditor Subscription to stock 41 Subscriptions to stock, time of payment 41, 43 Superintendent of banks, to consent to change number of directors 21 Superintendent of insurance, to consent to change number of directors.. 21 Supreme court may extend time for making financial statement 62 Supreme court, power to direct sale, etc 5 Surrender of corporate rights, when 61 Surplus profit, dividends to be confined to 23 T. Time of payment of subscriptions to stoek 43 Title, act to be known by 1 Town authorities, assent of, to reorganization 6 Trade, unlawful restraint of, forbidden 7 Transfer of stock 40 not lawful until indebtedness to corporation paid 25 of stock, by stockholder indebted, etc 20 of stock, entry of necessary, to relieve owner 29 of stock, when becomes valid 2^ Transfer to officers or stockholders, prohibited in certain cases 48 Treasurer, directors to appoint 27 Trustee's, when liable as stockholders . 54 approval of assumption of debts by, on reorganization 4 U. Unlawful restraint of trade, forbidden 7 loans to stockholders by foreign corporation, liability for. . .^ . GO Unpaid stock, liability of owner ot -to creditors 54 V. Vacancies, primary inspectors, how filled 28 in office of director, how filled 20 in appraisers appointed by court to appraise stock 33 filling of. in board of directors 20 Verification of annual report 30 certificate by director, as to annual report 30 Village authorities, assent of, to reorganization Voting to change principal place of business and office 69 93 INDEX. SECTION Voting on exchange of preferred for common stock 47 on stock under plan of reorganization 1 of stockholders to extend business 32 on sale of franchise and property 33 to guarantee bonds of another corporation 40 Void acts of directors, what are 22 transfer of stock, in contemplation of insolvency 48 w. Wages, etc., liability of stockholders for 54 Waiver by creditor of liability of officer, etc., for debt 34 94 THE RAILROAD LAW, BEING CHAPTER 565 OF THE LAWS OF 1890, AS AMENDED AJ CHAPS. 302 AND 367 OF THE LAWS OF 1891, AND BY CHAP* 300. 460, 534, 676 AND 700 OF THE LAWS OF 1892. CHAPTER XXXIX OF THE GENERAL LAW& THE RAILKOAD LAW. ARTICLH 1. Organization; general powers; location ( 1-21). 2. Constructs in ; operation ; management ( 30-59). 3. Consolidation ; lease ; pal^ ; reorganization ( 70-88). 4. Street surface railroads ( 90-110). 5. Other railroads in cities and counties ( 120-142). 6. Board of railroad commissioners ( 150-171). ARTICLE I. ORGANIZATION, GENERAL POWERS, LOCATION. SECTION 1. Short title. 2. Incorporation. 3. Supplemental certificate. 4. Additional powers conferred. 1. Entry upon lands for purpose of survey. 2. Acquisition of real property. 3. Construction of road. 4. Intersection of streams, highways, plank-roads, turnpikes and canals. 5. Intersection of other railroads. 6. Buildings and stations. 7. Transportation of persons and property. 8. Time and manner of transportation. 9. Purchase of lands and stock in other states. 5. When corporate powers to cease. 6. Location of route. 7. Acquisition of title to real property. 8. Ra'lroads through public lands. 9. Railroads through Indian lands. 10. Railroads through Chautauqua assembly, ground?). 11. Intersection of highways, additional lands for. 12. Intersection of other railroads. 13. Change of route, grade or terminus. 14. Construction of part of line in another state. 15. Two roads having the same location. 16. Tunnel railroads. 17. Railroads ri foreign countries. 18 Additional corporate powers of such road. 19. Location of principal office of such road. 20 Individual ioint-stock association, or other corporation may J*y down and'maintain railroad tracks in certain cases. 21 Powers of electric light and power corporations. 22. Substituted lines in case of eminent domain. 23. Application. THE RAILROAD LAW. SECTION 1. Short title. This chapter shall be known as the rail- road law. 2. Incorporation. Fifteen or more persons may become a cor- poration, for the purpose (1) of building, maintaining and operat- ing a railroad, or (2) of maintaining and operating a railroad already built, not owned by a railroad corporation, or for both pur- poses, or (3) of building, maintaining and operating a railroad for use by way of extension or branch or cut-off of any railroad then existing, or for shortening or straightening or improving the line or grad.; of such railroad or of any part thereof, by executing, acknowledging and filing a certificate, in which shall be stated: Amended by ch. 727 of 1905. In effect June 3, 1905 1. The name of the corporation. 2. The number of years it is to continue. 3. The kind of road to be built or operated. 4. Its length and termini. 5. The name of each county in which any part of it is to be located. 6. The amount of capital stock, which shall not be less than ter thousand dollars for every mile of road built, or proposed to be built, except a narrow-gauge road, when it shall not be less than three thousand dollars for every such mile. 7. The number of shares into which the capital stock is to be divided. 8. If the capital stock is to consist of common and preferred stock, the amount of each class and the rights and privileges of the latter over the former. 9. The names and post-office addresses of the directors of the corpora- tion, not less than nine, who shall manage its affairs for the first year. 10. The place where its principal office is to be located. 11. If a street surface railroad, the names and description of the streets, avenues and highways in which the road is to be constructed. 12. If it is to be a railway corporation, specified in article five of this chapter, the statements required by that article to be inserted in the certificate of incorporation. 13. The name and post-office address of each subscriber to the cer- tificate and the number of shares of stock he agrees to takes. Such certificate shall have indorsed thereon, or annexed thereto, to be taken as a part thereof, an affidavit of at least three of such directors, that at least ten per cent of the minimum amount of capital stock authorized by law has been subscribed thereto, and paid iu good "faith MIK! in cash to the directors named in the certificate-, and that it. is intended in good faith to build, maintain and operate the road men- tioned therein. In case of a railway corporation s]>iH-iii(Ml in article five of this chapter, the affidavit of the directors shall show that the full Minoimt of such capital stock has been iu good faith subscribed, and there shall be annexed to the certificate of incorporation and as a part, thereof the certificate of the railroad commissioners showing the organization of the corporation for the purposes mentioned in the cer- tificate. THE RAILROAD LAW. The filing of every certificate, where the amount of stock required by this section has not been in good faith subscribed and paid in cash, shall be void. Amended by L. 1892, ch. 676. 3. Supplemental certificate. If the names and places of residence of the directors of the corporation have been omitted from the certifi- cate, when executed and acknowledged, and thereafter the requisite number of directors has been chosen at a meeting of the subscribers to the certificate, a supplemental certificate, containing their names and places of residence, may be filed with such certificate with the same force and effect as if the names and places of residence of the directors had been originally inserted therein. 4. Additional powers conferred. Subject to the limitations and requirements of this chapter, every railroad corporation, in addition to the powers given by tine general and stock corporation laws, shall have power. 1. Entry upon lands for purposes of survey. To cause the neces- sary examination and survey for its proposed railroad to be made for the selection of the most advantageous route; and for- such purpose, by its officers, agents or servants, to enter upon any lands or waters subject to liability to the owner for all damages done. 2. Acquisition of real property. To take and hold such voluntary grants of real estate and other property as shall be made to it to aid in the construction, maintenance and accommodation of its railroad and to acquire by condemnation such real estate and property as be necessary for such construction, maintenance and a - in the manner provided by law, but the real property acquired condemnation shall be held and used only for the purposes of tii- poration during the continuance of the corporate existence. 3. Construction of road. To lay out its road not exceeding si rods in width, and to construct the same; and, for thepurpo?e of eir 3 THE RAILROAD LAW. tings and embankments, to take such additional lands as may be necessary for the proper construction and security of the road; and to cut down any standing trees that may be in danger of falling on the road, upon making compensation therefor. 4. Intersection of streams, highway, plankroads, turnpikes and canals. To construct its road across, along or upon any stream, water- course, highway, plankroad, turnpike, or across any of the canals of the state, which the route of its road shall intersect or touch. 5. Intersection of other railroads. To cross, intersect, join, or unite its railroad with any other railroad before constructed, at any point on its route and upon the ground of such other railroad corpora- tion, with the necessary turnouts, sidings, switches, and other con- veniences in furtherance of the objects of its connection. 6. Buildings and stations. To erect 'and maintain all necessary and convenient buildings, stations, fixtures and machinery for the ac- commodation and use of its passengers, freight and business.. 7. Transportation of persons and property. To take and convey persons and property on its railroad by the power or force of steam or of animals, or by any mechanical power, except where such power is specially prescribed in this chapter and to receive compensation there- for. 8. Time and manner of transportation. To regulate the time and manner in which passengers and property shall be transported, and the compensation to be paid therefor. 9. Purchase of lands and stock in other states. 'To acquire and dispose of any real property in any other state through which any part of the railroad is operated, and stock in any foreign corporation owning lands another state for tftie purpose of securing for such railroad corporation in this state a permanent supply of fuel for its use, MI id stock of corporations in this state, formed for the purpose of erecting railway depots. THE RAILROAD LAW. 10. Creation of mortgage. From time to time to borrow 8uch sums of money as may be necessary for completing and finishing or operating or improving its railroad, or for any other of its lawful purposes and to issue and dispose of its bonds for any amount so borrowed, and to mortgage its property and franchises to secure the payment of any debts contracted by the company for the purposes aforesaid, notwithstanding any limitation on such power contained in any general or special law. But no mortgage except purchase money mortgages, shall be issued by any railroad corporation under this or any other law without the consent of the board of railroad commissioners and the consent of the stockholders owning at least two-thirds of the stock of the corporation, which consent shall be in writing, and shall be given and certified and be filed and recorded in the office of the clerk or register of the county where it has its principal place of business, as provided in section two of tihe stock corporation law; or else the consent of the board of rail- road commissioners and the consent by their votes of stockholders owning at least two-thirds of the stock of the corporation, which is represented and voted upon in person or by proxy at a meeting called for that purpose upon a notice stating the time place and object of the meeting, served at least three weeks previously upon each stockholder personally, or mailed to him at his post-office address, and also published at least once a week for three weeks successively in some newspaper printed in tihe city, town or county where such corporation has' its 'principal office; and a certificate of the vote at such meeting, shall be signed and sworn to and shall be filed and recorded as provided by section two of the stock corporation law. When authorized by the stock- holders consent to any bonds made or issued under this section, the directors, under such regulations as they may adopt, may confer on the holder of any such bonds the right to convert the principal thereof, after two and not more than twelve years from the date of the bond, into stock of the corporation at a price fixed by the board of directors, which may be either par or a price not less than the market value thereof at the date of such consent to such bonds; and if the capital 4a THE RAILROAD LAW. :x shall not be sufficient to meet Uhe conversion when made, the board (..sectors shall autnorize an increase of capital stock sufficient for iii purpose. ^u.jd 10 amended by ch. 482, Laws 1900. cnitid 1;< uniended by ch. 504 of 1902. In effect April 10, 1902. oce secliua 8, Stock Corporation Law, ante. 5. When corporate powers to cease. If any domestic railroad cor- ^oration shall not, within five years after its certificate of incorporation is filed, begin the construction of its road and expend thereon ten per centum of the amount of its capital, or shall not finish its road and put it in operation in 4en years from the time of filing such certificate, its corporate existence and powers shall cease. But if any such steam railroad corporation whose certificate of incorporation was filed since the year eighteen hundred and eighty, and whose road as designated in such certificate is wholly within one county and not more than ten miles in length, has acquired the real property necessary for its road bed by purchase, its corporate existence and powers shall not be deemed to have ceased because of its failure to comply with the provisions of this article; and the time for beginning the construction of its road and expending thereon ten per centum of its capital, is extended until thirteen years from the date of the filing of such certificate and the time for finishing its road and putting it in operation, is extended until eighteen years from the date of such filing. This section shall not apply to any street surface railroad company incorporated prior to July first, eighteen hundred and ninety-five, wthich has obtained or become the owner of the consents of the local authorities, of any city of the first or second class, given under article four of the railroad law to the use of public streets, avenues or highways for the construc- tion and operation of the railroad thereon. Amended by ch 508 of 1901. In effect April 23, 1901. 6. Location of route. Every railroad corporation, except a street surface railroad corporation and an elevated railway corporation, before 4b THE RAILROAD LAW. constructing any part of its road in any county named in its certificate of incorporation, or instituting any proceedings for the condemnation of real property therein, shall make a map and profile of the route adopted by it in such county, certified by the president and engineer of the corporation, or a majority of the directors, and file it in the office of the clerk of the county in which the road is to be made. The corpora- tion shall give written notice to all actual occupants of the lands over which the route of the road is so designated, and which has not been purchased by or given to it, of the time and place such map and profile were filed, and that such route passes over the lands of such occupant. Any such occupant or the owner of the land aggrieved by the proposed location, may, within fifteen days after receiving such notice, give ten days' written notice to such corporation and to the owners or occupants of lands to be affected by any proposed alteration, of the time and place of an application to a justice of the supreme court, in the judicial dis- trict where the lands are situated, by petition duly verified, for the ap- pointment of commissioners to examine the route. The petition shall state the objections to the route designated, shall designate the route to which it is proposed to alter the same, and shall be accompanied with a survey, map and profile of the route designated by the corporation, and of the proposed alteration thereof, and copies thereof shall be served upon the corporation and such owners or occupants with the notice of the application. The justice may, upon the hearing of the application, appoint three disinterested persons, one of whom must be a practical civil engineer, commissioners to examine the route proposed by the cor- poration, and the route to which it is proposed to alter the same, and after hearing the parties, to affirm the route originally designated, or adopt the proposed alteration thereof, as may be consistent with the just rights of all parties and the public, including the owners or occupants of lands upon the proposed alteration; but no alteration of the route shall be made except by the concurrence of the commissioner who is a practi- cal civil engineer, nor which will cause greater damage or injury to lands or materially greater length of road than the route designated by the corporation, nor which shall substantially change the general line adopted by the corporation. The commissioners shall, within thirty days after their appointment, make and certify their written determination, which with the petition, map, survey and profile, and any testimony taken be- fore them shall be immediately filed in the office of the county clerk of the county. Within twenty days after such filing, any party may, by written notice to the other appeal to the general term of the supreme court from the decision of the commissioners, which appeal shall be heard and decided at the next term held in the department in which the lands of the petitioners or any of them are situated, for which the same can be noticed, according to the rules and practice of the court. On the hearing of such appeal, the court may affirm the route proposed by the corporation or may adopt that proposed by the petitioner. The commis- sioners shall each be entitled to six dollars per day for their -services, and to their reasonable and necessary expenses, to be paid by the person who THE EAILROAD LAW. applied for their appointment. If the route of the road as designated by the corporation, is altered by the commissioners, or by the order of the court, the corporation shall refund to the petitioner the amount so paid, unless the decision of the commissioners is reversed upon appea 1 . taken by the corporation. Xo such corporation shall institute any pro ceedings for the condemnation of real property in any county until after the expiration of fifteen days from the service by it of the notice re- quired by this section. Every such corporation shall transmit to the board of railroad commissioners the following maps, profiles and draw- ings exhibiting the characteristics of their road, to wit: A map or maps showing the length and direction of each straight line; the length and radius of each curve; the point of crossing of each town and county line, and the length of line of each town and county accurately determined .by measurements to be taken after the completion of the road. Whenever any part of the road is completed and used, such maps and profiles of such completed part shall be filed with such board within three months after the completion of any such portion and ihe com- mencement of its operation ; and when any additional portion of the, road shall be completed and used, other maps shall be filed within the same period of time, showing the additional par.s so completed. If the route, as located upon the map and profile filed in the office of at y county clerk, shall have been changed, it shall also cause a copy of the map and profile filed in the office of the railroad commissioners, .so far as it may relate to the location in such county, to be filed in the office of the county clerk. [Thus amended by L. 1892, ch. 676.] 7. Acquisition of title to real property. All real property, re- quired by any railroad corporation for the purpose of its incorporation, or for any purpose stated in the railroad law, shall be deemed to be required for a public use, and may be acquired by such corporation. If the corpora- tion is unable to agree for the purchase of any such real, property, or of any right, interest or easement therein, required for any such purpose, or if the owner thereof shail be incapable of selling the same, or if after diligent search and inquiry the name and residence of any such owner can not be ascertained, it shall have the right to acquire title thereto by con- demnation. Every railroad corporation shall have the power from time to time to make and use upon or in connection with any railroad either owned or operated by it, such additions, betterments and facilities as may be neces- sary or convenient for the better management, maintenance or operation of any such railroad, and shall have the right by purchase or by condemnation, to acquire any real property required therefor, and it shall also have such right in the following additional cases: Am'd by ch. 727 of 1905. In effect June 3, 1905. 1. ^Tiere title to real property has been acquired, or attempted to be acquired, and has been found to be invalid or defective. 2. Where its railroad shall be lawfully in possession of a lessee, mortgagee, trustee or receiver, and additional real property shall be required for the purpose of running or operating such railroad. 3. Where it shall require for any railroad owned or operated by it any further rights to lands or the use of lands for additional main tracks or for branches, sidings, switches or turnouts, or for connections or for cut-otFs. or for shortening or straightening or improving the line or grade of its road or any part thereof. Also where it shall require any further rights in lands or the use of lands for filling any structures <-f it- ivad. or for constructing, widening or completing any of its embankments or roadbeds, by means of which greater safety or permanency may be secured, and such lands shall be contiguous to such railroad and reasonably accessible. Am'd by ch. 727 of 10C3. In c^eet June *3, 1905. THE RAILROAD LAW. reasonably accessible to the place where the same are to be used for such purpose or purposes. 4. Where it shall require any further right to lands or to the usa of lands for the flow of water occasioned by railroad embankments or .structures now in use, or hereafter rendered necessary, or for any other purpose necessary for the operation of such railroad, or for any right to take and convey water from any spring, pond, creek or river to such railroad, for the uses and purposes thereof, together with the right to build or lay aqueducts or pipes for the purpose of conveying such water, and to take up, relay and repair the same, or for any right of way required for carrying away or diverting any water, stream or floods from such railroad for the purpose of protecting its road or for the purpose of preventing any embankment, excavation or structure of such railroad from injuring the property of any person who may be rendered liable to injury thereby. Waters commonly used for domestic, agricultural or manufacturing purposes, shall not be taken by condemnation to such an extent as to injuriously interfere with such use in future. No railroad corporation shall have the right to acquire by condemnation any right or ease- ment in or to any real property owned or occupied by any other rail- road corporation, except the right to intersect or cross the tracks and lands owned or held for right of way by such other corporation, without appropriating or affecting any lands owned or held for depots or gravel-beds. [Thus amended by L. 1892, cli. 676.] 8. Railroads through public lands. The commissioners of the land office may grant to any domestic railroad corporation any land belonging to the people of the state, except the reservation at Niagara and the Concourse lands on Coney Island, which may be required for the purposes of its road on such terms as may be agreed upon by them ; or such corporation may acquire title thereto by condemnation; and the county or town officers having charge of any land belonging to any county or town, required for such corporation for the purpose of its road, may grant such land to the corporation for such compensation as may be agreed upon. In case the land or any right, interest or easement therein, required by such railroad corporation is used for prison purposes the commissioners of the land office may grant such land, or any right, interest or easement therein, provided the plans of such railroad corporation for the use of such prison lands, or such right, interest or easement therein, have the approval of the superin- tendent of state prisons. Amended by ch. 313 of 1904. In effect April 13, 1904. 9. Railroads through Indian lands. Any railroad corporation may contract with the chiefs of any nation of Indians, over whose lands it may be necessary to construct its railroad, for the right to make such road upon such lands, but such contract shall not vest in the corporation the fee to the land, nor the right to occupy the same for any purposes other than may be necessary for the construction occupancy and maintenance of such railroad, and such contract shall THE EAILROAD LAW. not be valid or effectual until it shall be ratified by the county court of the county where the land shall be situated. 10. Railroads through Chautauqua assembly grounds. No railroad corporation shall build, construct or operate any railroad in, upon, over or through the grounds, lands or premises owned by the Chautauqua assembly corporation in the town and county of Chautauqua, without the written consent of a majority of the board of trustees of such assembly corporation. 11. Intersection of highways additional lands for. No rail- road corporation shall erect any bridge or other obstruction across, iu or over any stream or lake, navigated by steam or sail boats at. the place where it may be proposed to be erected, nor shall it con- struct its road in, upon or across any street of any city without the assent of the corporation of such city, nor across, upon or along any highway in any town or street in any incorporated village, without the order of the supreme" court of the district in which such highway or street is situated, made at a special term thereof, after at least ten days written notice of the intention to make application for such order shall have been given to the commissioners of highways of such town, or board of trustees of the village in which such highway or street is situated. Every railroad corporation which shall build its road along, across or upon any stream, watercourse, street, highway, plankroad or turnpike, which the route of its road shall intersect or touch, shall restore the stream or watercourse, street, highway plank road and'turn- pike, thus intersected or touched, to its former state, or to such state as not to have unnecessarily impaired its usefulness, and any such high- way, turnpike or plankroad may be carried by it, under or over its track, as may be found most expedient. Where an embankment or cutting shall make a change in the line of such highway, turnpike or plankroad desirable, with a view to a more easy ascent or descent, it may construct such highway, turnpike or plankroad, on such new line as its directors may select, and may take additional lands therefor by condemnation if necessary. Such lands so taken shall become part of such intersecting highway, turnpike or plankroad, and shall be held in the same manner and by the same tenure as the adjacent parts of the highway, turnpike or plankroad are held for highway purposes. Every railroad corporation shall pay all damages sustained by any turnpike or plankroad corporation in consequence of its crossing or occupation of any turnpike or plankroad, and in case of inability to agree upon the amount of such damages it may acquire the right to such crossing or occupation by condemnation. 12. Intersection of other railroads. Every railroad corpora- 8 THE HAILKOAD L.\\v. tion, whose road-bed is or shall be intersected by any new railroad, shall unite with the corporation owning such new railroad in forming the neces- sary intersections and connections, and grant the requisite facilities therefor. If the two corporations can not agree upon the amount of com- pensation to be made therefor or upon the line or lines, grade or grades, points or manner of such intersections and connections, the same shall be ascertained and determined by commissioners, one of whom must be a practical civil engineer and surveyor, to be appointed by the court, as is provided in the condemnation law. Such commissioners may determine whether the crossing or crossings of any railroad before constructed shall be beneath, at, or above the existing grade of such railroad, and upon the route designated upon the map of the corporation seeking the crossing or otherwise. All railroad corpora- tions whose roads are or shall hereafter be so crossed, intersected or joined, shall receive from each other and forward to their destination all goods, merchandise and other property intended for points on their respective roads, with the same dispatch as, and at a rate of freight not exceeding the local tariff rate charged for similar goods, merchan- dise and other property, received at or forwarded from the same point for individuals and other corporations. [Thus amended by L. J ch. ti7().J 13. Change of route, grade or terminus. Every railroad cor- poration, except elevated railway corporations, may, by a vote of two- thirds of all its directors, alter or change the route or any part of the route of its road or its termini, or locate such route, or any part thereof, or its termini, in a county adjoining any county named in its cer- tificate of incorporation, if it shall appear to them that the line can be im- proved thereby, upon making and filing in the clerk's office of the proper county a survey, map and certificate of such alteration or change. If the same is made after the corporation has commenced grading the orginal route, compensation shall be made to all persons for injury done by such grading to any lands donated to the corporation. But neither terminus can be changed, under this section, to any other county than one adjoining that in which it was previously located ; nor can the route or terminus of any railroad be so changed in any town, county or municipal corporation, which has issued bonds and taken any stock or bonds in aid of the construction of such railroad without the written consent of a majority of the tax payers appearing upon the last assessment-roll of such town, county or municipal corporation, unless such terminus, after the change, will remain in the same village or city as theretofore. No alteration of the route of any railroad after its construction shall be made, or new line or route of road laid out or established, as provided hi this section, in any city or village, unles* a THE RAILROAD LAW. approved by a vote of two-thirds of the common council of the city or trustees of the village. Any railroad corporation whose road as located terminates at any railroad previously constructed or located, whereby communication might be had with any incorporated city of the state, may amend its certificate of incorporation so as to terminate its road at the point of its intersection with any railroad subsequently located to intersect it, and thereby, by itself or its connection, afford commu- nication with such city, with the consent of the stockholders owning two-thirds of the stock of the corporation. Any railroad corporation may, by a vote of its directors, change the grade of any part of its road, except that in the city of Buffalo, such change must conform to the general plan heretofore adopted and filed by the grade crossing commissioners of said city, or any modi- fication thereof, within the territory covered by said general plan, in such manner as it may deem necessary to avoid accidents and facilitate the use of such road ; and it may by such vote alter the grade of its road, for such distance and in such manner as it may deem necessary, on each or either side of the place where the grade of its road has been changed by direction of the superintendent of public works, at any point where its road crosses any canal or canal feeder, except that in the city of Buffalo such change must conform to the general plan heretofore adopted and filed by the grade crossing commissioners of said city, or any modi- fication thereof, within _the territory covered by said general plan. The superin- tendent of public works shall have a general and supervisory power over that part of any railroad which passes over, or approaches within ten rods of any canal or canal feeder belonging to the state so far a. may be necessary to preserve the free and perfect use of such canals or feeders, or to make any repairs, im- provements or alterations, in the same. Any railroad corporation whose tracks cross any of the canals of the state, and the grade of which may be raised by di- rection of the superintendent of public works, with the assent of such superin- tendent, may lay out a new line of road to cross such canal at a more favorable grade, and may extend such new line and connect the same with any other line of road owned by such corporation upon making and filing in the clerk's office of the proper county a survey map and certificate of such new or altered Hne. No portion of the track of any railroad, as described in its certificate of incorporation, shall be abandoned under this section. Am'd by ch. 235 of 1897. Took effect April 14, 1897. 14. Construction of part of line in another state. Any rail- road corporation, whose proposed railroad is to be built between any two points in this state, may, by a vote of two-thirds of all its directors, locate and construct a part of its road in an adjoining state ; and the sections of its road within this state shall be deemed a connected line, according to the certificate of incorporation, and the directors may re- duce the capital stock of the corporation to such amount as may be deemed proper, but not less than ten thousand dollars per mile for the number of miles of road to be actually constructed in this state. 15. Two roads having the same location. If *wo railroad cor- 10 THE RAILBOAD LAW. poratioris for a portion of their respective lines embrace the same loca- tion of line, or if their lines connect, or are tributary to each other, such corporations may by agreement provide for the construction by one of them of so much of such line as is common to both, or connects with its own line, and for the manner arid terms upon which the business threon shall be performed, and the corporation that is not to construct the p;irt of the line which is common to both, may amend its certificate of incor- poration, and terminate its line at the point of intersection, and may reduce its capital to a sum riot less than ten thousand dollars for each mile of road proposed to be constructed in such amended certificate. 16. Tunnel railroads. When, according to the route and plan for the building of its road, adopted by any railroad corporation including corporations organized under chapter one hundred and forty of the laws of eighteen hundred and fifty, and the acts amenda- tory thereof, and supplementary thereto, it shall be necessary or proper to build it or any part of it under ground, or to tunnel or bridge any river or waters, such corporation may enter upon, acquire title to and use such lands under water and uplands, except on or along any canals of the state, as shall be necessary for the purpose herein mentioned, and may construct, erect and secure the necessary foundations and other structures which may be required for operat- ing and maintaining such road, or connecting the same with another, and to acquire, in the manner provided by law, such land or rights or easements in lands along its route, upon, over or beneath the sur- face thereof as may be necessary for the construction of its road and making such connections. Where such road runs underneath the ground, at such depth as to enable the corporation to tunnel the same, such tunnel shall be so built and at all times kept in such con- dition as to make the surface of the ground above the same and in the neighborhood thereof firm and safe for buildings and other erections thereon, and if surface excavations are made the surface shall be restored to its former condition as soon as can be done, except so far as may be actually required for ventilation -of the tunnel beneath the same or access thereto. Such road or any part of it may be built within the limits of any city or incorporated village of this state, and run by means of a tunnel* underneath any of the streets, roads or public places thereof, provided such corpora- tion shall before constructing the same underneath any such street road or public place, have obtained the consent of the owners of one-half in value of the property bounded on the line of snch street, road or public place, and the consent of the board of trustees of the village, by a resolution adopted at a regular meeting and entered on the records of the board, or of the proper authorities of the city having control of such streets, roads or public places. If the con- 11 HAILKOAD LAW. sent of such property owners can not be obtained, the general term of the supreme court in the district in which said city or village or any part thereof is situated, may upon application appoint three commissioners, who shall determine, after a hearing of all parties interested, whether such railroad ought to be built underneath such streets, roads or public places, or any of them, and in what manner the same may be so built with the least damage to the surface and to the use of the surface by the public and the determination of the commissioners confirmed by the court may be taken in lieu of the consent of the property owners. All railroad corporations con- structing their road under this section shall be subject to all the provisions of this chapter applicable thereto. Any other railroad corporation may connect its road therewith, at ench points or places as it may elect, and where such connections shall be made by con- necting roads, the railroad corporations owning such roads shal build, at their joint expense, and for their joint- use, such passenger and freight depots, and other accommodations for handling pnssen>ic i> and freight, as may be required for the convenience of the public All railroad corporations, constructing any tunnel under this section shall be liable to any person or corporation for all damages which may be sustained by reason of the construction of such tunnel. Whenever it shall be necessary in constructing any railroad author- ized by this section through any city or incorporated village, to alter the position or course of any sewer, or water or gas pipes, it shall he done at the expense of the railroad corporation under the direction of the department or corporation having charge thereof, so as not to interfere with such work. In all cases the uses of streets, docks and lands beneath which such railroad is constructed, and on the route thereof and the right of way beneath the same, for the purpose of such railroad shall be considered, and is hereby declared, a public use, consistent with and one of the uses for which streets and docks are publicly held. No public park or square in any city or village of this state shall be used or occupied by any corporation for any of the purposes of this section, and every road constructed hereunder in or through any such street or public place shall be wholly underground an I constructed in a tunnel and not otherwise, but nothing in this section shall operate to revive any charter or franchise heretofore granted by or in the city of Brooklyn. This act does not authorize the construction of any bridge over or across the East or North rivers. Am'd by chaps. 676 and 702 of 1892 and chap. 316 of 1893. 17. Railroads in foreign countries'. A railroad corporation may be formed under this chapter for the purpose of con- structing, maintaining and operating in any foreign country a railroad for public use in the transportation of persons and property, or for the purpose of maintaining and operating therein any railroad already constructed, in whole or in part, To]- the like public use, and of constructing, maintain- ing and operating in connection therewith, telegraph lines and lines of steamboats or sailing vessels. Any corporation formed for the construction and operation of a railroad by stationary power, may construct, operate and maintain a 12 THE RAILROAD LAW railroad in any other state or country, if not in conflict with the laws thereof, but the assent of the inventors or patentees of the method of propulsion used must be first obtained in the same manner and to the same extent as would be neces- sary within the United States. The term " foreign " in this and the next two sections of this law shall include Porto Rico. Amended by ch. 676 of 1892. Amended by ch. 225 of 1902. In effect March 26, 1902. 18. Additional corporate powers of snch road. The corporation six-fi- ned in the preceding section shall have the following additional powers : 1. To expend ir.oney in making preliminary examinations and surveys for its proposed railroad, telegraph lines, and lines of steamboats and sailing vessels, ami hi acquiring from foreign countries, nations or governments, the grants, conces- sions and privileges herein authorized. 2. To take and receive from foreign countries, nations and governments, sucli grants, concessions or privileges, for the construction, acquisition, maintenance and operation of railroads, telegraph lines and vessels, as may be consistent witli the purposes of the corporation, and as may be granted and conceded to it, and to hold the same under such restrictions and with such duties and liabilities as may be fixed by the laws of such foreign country, nation or government, or as may be annexed to such grants or concessions. 3. To construct, acquire, maintain and operate the lines of railroad, telegraph and shipping provided for by its certificate of incorporation, and to take and hold by purchase or by voluntary grant such real estate and other property in foreign countries as may be necessary and convenient for the construction, maintenance and accommodation of such lines, and to sell, convey, mortgage or lease such real estate or other property ; and to acquire by purchase or otherwise any railroad or lines of telegraph constructed or in process of construction in any foreign country, and any granls, concessions, franchises, rights, privileges and immuni- ties relating thereto, and to issue therefor the capital stock of the company or any part thereof at such valuation or valuations and on such terms as may be agreed upon, and to mortgage or sell and convey such railroad or lines of telegraph con- structed or in process of construction in any foreign country, and any grants, concessions, franchises, rights, privileges and immunities relating thereto, or any part of its property to any person or corporation created by this or any other state or foreign government, subject to the laws of the country or countries where such property may be, and the power of sale hereby granted shall be exercised only by a majority of the entire board of directors of the corporation, with the written concurrence of the holders of two-thirds in amount of its capital stock. 4. To take and convey persons and property on its transportation lines by the power or force of steam or of animals, or by mechanical or other power, and re- ceive compensation therefor subject to the laws of the. place or country where the same are situated. 5. To acquire and use such real estate and other property in this state as may "be necessary in the conduct of its business, but the value of such real estate held at any one time shall not exceed the sum of one million dollars. Am'd by ch. 504 of 1897. 19. Location of principal office of such road.-Every such corporation shall maintain its principal office within this state and shall have during busi hours an olticer or agent upon whom service of process may be made, and : h -Id i'i this state at least one meeting of the stockholders in each year f Chwwn directors which shall be known as the annual meeting and be heki at t * I ne aaJ place fixed by the by-laws of the corporation. [Thus amended by L H^, ch. (376. ] 13 RAILROAD LAW. 20. Individual, joint stock association, or other corporation may lay down and maintain railroad tracks in certain cases. Any individual, joint stock association or corporation, engaged in any lawful business in this state, rruy, except in any city of the state, lay down and maintain such railroad tracks on or across any street or highway, not exceeding three miles in length, as shall be necessary for the transaction of its business, and to connect any place of busi- ness owned by them with the track of any railroad corporation, and render such place o* business more accessible to the public, upon obtaining the written consent of the owners of all the lands bounded on and of the local authorities having con- trol of that portion of the street or highway, upon which it is proposed to con- struct or operate such railroad. If the consent of such property owners cannot be obtained, the general term of the supreme court of the department in which such railroad is to be constructed, may, upon application, appoint three commis- sioners, who shall determine, after a hearing of all parti' s interesteu. whether such railroad ought to be constructed or operated, and the amount of damages, if any, to be paid to sucii property owners, and their determination confirmed by the court may be taken in lieu of the consent of the property owners. But no such railroad shall be so located, graded, built or operated as to interfere with or ob- struc the trave'ed part of any highway, or its use as a highway, or the use of any street <>r highway intersecting the same. 21. Any corporation whose railroad is or shall be not longer than sixteen mill s and is or shall be in large part intended for or used in summer travel, or the convenience of suni'iier sojourners, need not operate its road beyond the months of .Line, July, August and September, inclusive. The motive power may be electricity. Is the road be not longer 'han ti-n miles, snch corporation may fix and collect fare for transporting eacii passenger, together with ordinary baggage, if any, not to exceed fifteen cents f i ea -h mile a .d fraction thereof. Added by chap. 70> of 1-03. 21. Powers of electric light and power corporations. Whenever all of the stockholders of any domestic electric light and power company, incorpo- rated under a general or special law, having not less than five stockholders, and actually engaged in carrying on business in this state shall execute and file, in the offices in which its original certificates of incorp ration are filed, an amended certificate of incorporation, complying in every other respect than as to the number of signers and directors, who shall not be less tl an five, with the pro- visions of the railroad law, and in which certificate the corporate name of such corporation shall be amended by adding before the word " company," in its cor- porate name, the words, "and railroad," or the words, "railroad and land," such corporation shall have the right to build, maintain and operate by electricity as a motive power, a railroad or railroads, not exceeding twenty -five miles In length, and within that distance from the power station, and shall also have the right to acquire the property and franchises of a railroad company or companies owning such a railroad or railroads, already constructed, and so operated, and to maintain and operate the same, provided that the directors of such railroad company or companies and all of its or their stockholders shall first have assented in writing to the transfer of the property and franchises of such railroad company or com- panies, to such corporation ; in which event and by the filing of such assent of directors and stockholders in the offices where the certificates of incorporation of the railroad company or companies were required to be filed, the rights, property and franchises of such railroad company or companies shall be transferred to, anil shall vest in sr.ch corporal ion, and such corporation so acquiring st-ch railroad or railroads shall be subject to all the provisions of chapter thirty-nine of the gnu-nil laws with respect to the railroad property or properties and franchises, and {-hall have all the powers, rights and privileges conferred by said chapter upon railroad corporations ; provided that no such corporation shall construct any railroad which is in whole or in part a street surface railroad without complying with the provisions of article four of the railroad law. Upon filing such certificate, such corporation shall also have the right to acquire by gift or by voluntary purchase and sale laud not exceeding two thousand acres along the line of, or contiguous to, said railroad, and to hold, improve, lease or sell same. Whenever any such corporation shall furnish power to any water works corporation carrying on its business in the county, or in a county adjoining that in which the operations of such corporation are carried on, it may acquire the shares of the capital stock of said water works corporation, and, if such corporation shall become the owner of rl! the stock of said waterworks corporntion.it. may, on executing ar.d filing a c-rtificate in nccordar ce with the requirenic 1 ts of section fifty eight of the stock c n-pnintions law, become possessed f till \\ ec state, rights, property, privileges and f ;;:.cl.ihcs of sue', water-works corporation, with the effect provided in said section 14 THE RAILROAD LAW. fifty-eight. This section shall not confer any powers upon any corporation located in or authorize the construction, maintenance or operation of a railroad in a city of the first or second class, except in that part of any city of the first class which is or may be situate in a county of less than one hundred thousand iuhabit- nnts, according to the last preceding enumeration for the national census. Amended by ch. 731 of 1901. In effect May 11, 1901. 22. Substituted Hues in cases of eminent domain. Where a portion of a steam surface railroad or branch thereof, shall be s-pecifically authorized by statute to be taken for any other public use, and such portion lies wholly (Tutside of any city, any corporation owuiug or operating such portion may locate, as provided in section six of this article, and may construct and operate, in substitution for such portion, and with proper connections with the former line, a new line of steam surface railroad, wholly or partly in the same or any adjoining county and wholly outside of any city, and not exceeding twenty-five miles in length, in the manner, with the powers and subject to the limitations and requirements provided in this chapter with respect to steam surface railroads. Added by chap. 656 of 1898. 23. Section 24 of the stock corporation law does not apply to a railroad cor- poration. Added by chap. 80 of 1896. ARTICLE II. CONSTRUCTION, OPERATION AND MANAGEMENT. SECTION 30. Liability of corporation to employes of contractor. 31. Weight of rail. 32. Fences, farm crossings and cattle-guards. 33. KigH-boards and flagmen at crossings. 34. Notice of starting trains ; no preferences. 35. Accommodation of connecting roads. 36. Locomotives must stop at grade crossings. 37. Rates of fare. 38. Legislature may alter or reduce fare. 39. Penalty for excessive fare. 40. Passengers refusing to pay fare may be ejected. 41. Extra fare for sleeping car. 42. Persons employed as drivers and conductors. 42a. Liability for injuries to employees. 43. Conductors and employes must wear badges. 44. Checks for baggage. 45. Penalties for injury to baggage. 46. Unclaimed freight and baggage. 47. Tickets and checks for connecting steamboats. 48. Rights and liabilities as common carriers. 49. Duties imposed : 1. Switches. 2. Warning signals. 3. Guard posts. 4. Automatic couplers. 5. Automatic or other safety brake. 6. Tools in passenger cars. 7. Water. 60. Railroad commissioners may approve other safeguard*. 51. Use of stoves or furnaces prohibited. 52. Canada thistles to be cut. 53. Riiiing on platform ; walking along track. 54. Corporations may establish ferries. 55. Certain railroads may cease operations in winter. 56. Mails. 57. Corporations must make annual report. 58. When conductors and brakemen may be policemen. 59. Hequisites to exercise of power of future railroad corporations. 59a Railroad commissioners may certify part of the route of a street \r face railroad. Power to revoke certificates, street surface ttil road extension. 59b. Revocation of certificate and consent. 60-69 Grade crossings. 3 30. Liability of corporation to employes of contractor. An action may be maintained against any railroad corporation b THE RAILROAD LAW. any laborer for the amount due him from any contractor for the con- struction of any part of its road, for ninety or any less number of days' labor performed by him in constructing such road, if within twenty days thereafter a written notice shall have been served upon the corpo- ration, and the action shall have been commenced after the expiration of ten days and within six months after the service of such notice, which shall contain a statement of the month and particular days upon which the labor was performed and for which it was unpaid, the price per day, the amount due, the name of the contractor from whom due, and the section upon which performed, and shall be signed by the laborer or his attorney and verified by him to the effect that of his own knowledge the statements contained in it are true. The notice shall be served by delivering the same to an engineer, agent or superin- tendent having charge of the section of the road, upon which the labor "was performed, personally, or by leaving it at his office or usual place of business with some person of suitable age or discretion ; and if the corporation has no such agent, engineer or superintendent, or in case he can not be found and has no place of business open, service may in like manner be made on any officer or director of the corporation. 31. Weight of rail. The rail used in the construction or the relaying of the track of every railroad hereafter built or relaid in whole or in part shall be of iron or steel, weighing not less than twenty-five pounds to the lineal yard on narrow gauge roads, and on ail other roads not less than fifty-six pounds to the lineal yard on grades of one hundred and ten feet to the mile or under, and not less than seventy pounds to the lineal yard on grades of over one hundred and ten feet to the mile, except for turnouts, sidings rnd switches. 32. Fences, farm crossings and cattle-guards. Every rail- road , corporation, and any lessee or other person in possession of its road, shall, before the lines of its roads are opened for use, and so soon as it has acquired the right of way for its roadway erect and there- after maintain fences on the sides of its road of height and strength sufficient to prevent cattle, horses, sheep and hogs from going upon i:s road from the adjacent lands with farm crossings and openings \\iili gates therein at such farm crossings whenever and wherever reasona- bly necessary for the use of the owners and occupants of the adjoin- ing lands, and shall construct where not already done, and hereafter maintain, cattle-guards at all road crossings, suitable and sufficient 10 prevent cattle, horses, sheep and hogs from going upon its railroad. So long as such fences are not made, or are not in good repair, the cor- poration, its lessee or other person in possession of its road, shall lie. liable for all damages done by their agents or engines or cars to any domestic animals thereon. When made and in good repair, they shall 16 THE RAILROAD LAW. not be liable for any such damages, unless negligently or willfully done. A sufficient post and wire fence of requisite height shall be deemed a lawful fence within the provisions of this section, but barbed wire shall not be used in its construction. No railroad need be fenced, when not necessary to prevent horses, cattle, sheep and hogs from .going upon its track from the adjoining lands. Every adjoining land owner, who, or whose grantor, has received compensation for fencing the line of land taken for a railroad, and has agreed to build and maintain a lawful fence along such line, shall build and maintain such fence. If such owner, his heir or assign shall not build such fence, or if built, shall neglect to maintain the same during the period of thirty days after he has been notified so to do by the railroad corporation, such corporation shall thereafter build and maintain such fence, and may recover of the person neglecting to build and maintain it the expense thereof. And when such railroad shall cross timbered or forest lands, the company shall construct and maintain suitable and sufficient crossings, whenever and wherever reasonably necessary to enable the respective owners of said lands, to transport logs, timber and lumber for manufacture or sale, or for banking on any stream, to be floated or driven down the same. In case of any neglect or dis- pute the supreme court may by mandamus or other appropriate pro- ceedings, compel the same, and also fix the point or location of any such crossing. [Thus amended by L. 1891, ch. 367, and by 1892, ck 676.] 33. Sign boards and flagmen at crossings. Every railroad corporation shall cause a sign board to be placed, well supported and constantly maintained, at every crossing where its road is crossed by a public highway at grade. Such sign board, shall be of a shape and design to be approved by the board of railroad commissioners, and shall have suitable words painted thereon to warn travelers of the existence of such grade crossing. The board of railroad commis- sioners shall have power to prescribe the location and elevation of such sign and the words of warning thereon. The commission may dispense with the use of such sign boards at such crossings as they may designate in cities and villages. At any point where a railroad crosses a street, highway, turnpike, plank-road, or traveled way at grade, or where a steam railroad crosses a horse railroad at grade, and the corporation owning or operating such railroad, refuses, upon request of the local authorities, to station a flagman or erect gates, to be opened and closed when an engine or train passes, the supreme court or the county court, may, upon the application of the local authorities and upon ten days' notice to the corporation, order that a flagman be stationed at such p-nnt, or that gates shall be erected thereat, and that a person be stationed to open and close them when an engine or train passes, or mav make such other order respecting the same as it deerns proper. Whenever the crossing by 17 THE RAILROAD LAW. a railroad at grade of the streets, highways, turnpike, plank- roads, or traveled ways of any village or city, having a population by the last state or federal enumeration of less than fifty thousand, shall be protected by gates with persons to open and close the same, when an engine or train passes, the local authorities of the city or village shall not impose any limitation, less than forty miles an hour, on the rate of speed at which such engine or train shall be run, or enforce any existing limitation upon such rate of speed, less than forty miles an hour. Amended by ch. 301 of 1901. In effect April 8, 1901. 84. Notice of starting trains ; no preferences. Every rail- road corporation shall start and run ics cars for the transportation of passengers and property at regular times, to be fixed by public notice, and shall furnish sufficient accomodations for the transportation of all passengers and property which shall be offered for transportation at the place of starting, within a reasonable time previously thereto, and at the junctions of other railroads, and at the usual stopping places established for receiving avid discharging way passengers and freight for that train ; and shall take, transport and discharge such passen- gers and property at, from and to, such places, on the due" payment of the fave or freight legally authorized therefor. No station established by any railroad corporation for the reception or delivery of passengers or property, or both, shall be discontinued without the consent of the board of railroad commissioners first had and obtained. No prefer- ence for the transaction of the business of a common carrier upon its cars, or in its depots or buildings, or upon its grounds, shall be granted by any railroad corporation to any one of two or more per- sons, associations or corporations competing in the same business, or in the business of transporting property for themselves or others. Any such station in an incorporate village shall have the same name as the village; if any road shall have more than one such station in any such village, the station nearest the geographical center thereof shall have such name. Amended 1SS'2. 35. Accommodation of connecting roads. Every railroad corporation whose road, at or near the same place, connects with or is intersected by two or move railroads competing for its business, shall fairly and impartially afford 1o each of such connecting or intersecting roails equal terms of accommodation, privileges and facilities in tho transportation of cars, passengers, baggage and freight over and upon its roads, and over and upon their roads, and equal facilities in the interchange and use of passenger, baggage, freight and other cars required to accommodate the business of each road, and in furnishing 18 RAILROAD LAW. passage tickets to passengers who may desire to make a continuous trip over any part of its roads and either of such connecting roads. The board of railroad commissioners may, upon application of the corporation owning or operating either of the connecting or intersect- ing roads, and upon fourteen days' notice to the corporation owning or operating the other road, prescribe such regulations as will secure, in their judgment, the enjoyment of equal privileges, accommodations and facilities to such connecting or intersecting roads as may be required to accommodate the business of each road, and the terms and conditions upon which the same shall be afforded to each road. The decision of the commissioners shall be binding on the parties for two years, and the supreme court shall have power to compel the perform- ance thereof by attachment, mandamus, or otherwise. 36. Locomotives must stop at grade crossings. All trains and locomotives on railroads crossing each other at grade shall come to a full stop before crossing. not less than two hundred or more than eight hundred feet from the crossing, and shall then cross only when the way is clear and upon a signal from a watchman stationed at the crossing. If the corporations cannot agree as to the expense of the watchman, it shall be determined by the supreme court, upon m tion thereto by either of them. If the corporations disa:ree as to the precedence of trains, the board of railroad commissioners may, after hearing, upon the application of either corporation, prescribe rules in relation thereto. The full stop and crossing on signal may be discontinued if the board of railroad commissioners shall decide it to be impracticable, or if, with the approval of the commissioners, an interlocking switch and signal apparatus is adopted and put in operation at such a crossing. The full stop and crossing on signal shall not be required in depot yards, or the approaches thereto, if the crossing roads are under lease or subject to the same management or control in the use of tracks. An engineer, violating the foregoing provisions of this section, or any such rule of the railroad commissioners, sh 11 be liable to a penalty of one hundred dollars; and any corporation or person operating the railroad, violating any of such provisions or rules shall be liable to a penalty of five hundred dollars. The board of railroad commissioners may, whenever in its judgment the public safety requires the erection of interlocking switch and signal devices at points where steam and street surface railroads intersect at grade, direct the erection of such devices and apportion the expense of construction, operation and maintenance thereof between the companies affected thereby. No railroad corporation, or any officer, agent or employe thereof, shall stop its cars, horses, or locomotives upon a grade crossing of a railroad of another corporation, for the purpose of receiving or delivering passoneers or freight or other purpose, and any person or corporation violating this provision, shall be liable to a penalty of two hundred and fifty dollars. [Am'd Oh. 466 of 1898 ] 37. Rates of fare. Every railway corporation may fix nnd coJ- lect the following rates of fare as compensation to be paid for trans 19 RAILROAD LAW. porting any passenger and his baggage, not exceeding one hundred and iifry pounds in weight, for each mile or fraction of a mile. 1. "Where the motive power is rope or cable, propelled by stationary p'jwer, live cents, with right to a minimum fare often cents; but if tho railroad is less than two miles in length, and overcomes an eleva- tion of five hundred feet or more to the mile, five cents for each one hundred feet of elevation so overcome, and the same rates of fare if the motive power is locomotives, furnished with cogs working into cogs on the railway, and the length of road does not exceed four miles. 2. If a road, not incorporated prior to May 15, 1879, and not located in the counties of New York and Kings, or within the limits of any incorporated city, and not more than twenty-five miles in length, five cents; if over twenty-five and not more than forty miles, four cents; and if over forty miles, three cents. Where by the laying down of a third rail upon a railroad of the ordinary gauge, a narrow-gauge track is created and used for the transportation of passengers, and the length of road does not exceed six miles, including any connecting road of the same gauge, such railroad, for the purpose of fare, shall be deemed a narrow-gauge road. 3. If its railroad overcomes an elevation of two hundred feet to the mile, for at least two consecutive miles, and does not excee'd twenty miles in length, ten cents ; if it overcomes an elevation exceeding three hundred feet to the mile, within a distance of two miles, five cents for each one hundred feet of elevation ; and where it overcomes an eleva- tion of more than one thousand feet, within a distance of two miles, seven cents for each one hundred feet of elevation in a mile. 4. If the line of its road does not exceed fifteen miles in length, and does not enter or traverse the limits of any incorporated city, and the distance traveled thereon by the passenger does not exceed one mile, five cents. 5. In all other cases, three cents for every such mile or fraction thereof, with a right to a minimum single fare of not less than five cents. This chapter shall not be construed to allow any rate of fare for way passengers greater than two cents per mile to be charged or taken over the track or tracks of the railroad known as the New York central railroad company, and the rate of fare for way passengers over the track or tracks of such company shall continue to be two cents per mile, and no more, wherever it is restricted to that of fare, nor shall any consolidated railroad corporation charge a higher rate of fare per passenger per mile, upon any part or portion of the consolidated line than was allowed by law to be charged by each existing corporation thereon previously to such consolidation. 38. Legislature may alter or reduce fare. The legislature may. \\-l\i-n any such railroad shall be open for use from time to time, alter or reduce the rate of freight, fare or other profits upon Midi road ; but Hie sum; shall n<>t, without the consent of the corporation.be so reduced -is io prodnco with such profits less then ten per centum per annum on the capital actua.ly expended; 20 RAILROAD LAW. nor unless on an examination of the amounts received and expended, to be made by the board of railroad commissioners they shall ascertain that the net incom derived by he corporation from all sources, for the year then last past shall have exceeded an annual income of ten per centum upon the capital of the corporation actually expended. No person shall issue or sell, or offer to sell any passage ticket or instrument giving or purporting to give any right, either absolute or upon any condition or contingency to a passage or conveyance upon any vessel or railway .ram, or for a berth or stateroom in any vessel unless he is an authorized agent of the owners or consignees of such vessel or of the company running such trains, excepting as allowed by sections six hundred and twenty-two and six hundred and twenty-three of the penal rode ; aid no person is deemed an author- ized agent of such owners, consignees or compmy unless he has received a certifi- cate of authority in writing therefor, specifying the name of the company line vessel or railway lor which he is authorized to act as agent, and the city town or village, together with the street and street number in which his office is kent for the sale of tickets ; and no general passenger agent or other officer of a common carrier whose duty it may be to supply tickets to the agents of said comn earner for sale to the public shall supply tickets for sale to any person other than such regularly authorized agents or persons specified in sections six hundred and twenty-two and six hundred and twenty-three of the penal code. Amended by ch. 639 of 190] . In effect May 4, 1901 39. Penalty for excessive fare. Any railroad corporation, which shall ask or receive more than the lawful rate of fare, unless such overcharge was made through inadvertence or mistake, not amounting to gross negligence, shall forfeit fifty dollars, to be recovered with the excess so receive d by the party paying the same ; but no action can be maintained therefor, unless commenced within one year after the cause of action accrued. 40. Passenger refusing to pay fare may be ejected. If any passenger shall refuse to pay his fare the conductor of the train, and the servants of the corporation, may put him and his baggage out of the cars, using no unnecessary force, on stopping the train, at any usual stopping place, or near any dwelling-house, as the conductor may elect. 41. Sleeping and parlor cars. Any railroad corporation may contract with any person, association or corporation for the hauling by the special or regular trains of said railroad corporation, the parlor, drawing-room or sleep- ing car or cars of such person, association or corporation, in which extra accommodations shall be furnished, for which said person, association or cor- poration furnishing such parlor, drawing-room or sleeping car or cars, may charge for the carriage and transportation of persons and property therein, a reasonable compensation for such extra accommodation, in addition to the fare and charges now allowed by law for the carriage and transportation of passengers and property in the ordinary cars of said railroad corporation. But said railroad corporation so contracting shall be liable in the same \v;iy and to the same extent as if the said car or cars were owned by it, and phall furnish sufficient ordinary cars for the reasonable accommodation of the traveling public. 42. Persons employed as drivers, conductors, motormen or gripmen. Any railroad corporation may employ any inhabitant of the State, of the age of twenty-one years, not addicted to the use of intoxicating liquors, as a car driver, conductor, motorman or gripman, or in any other capacity, if fit and competent therefor. All applicants for positions as motormen or gripmen on any street surface railroad in this State shall be subjected to a thorough ex- amination by the officers of the corporation as to their habits, physical ability and intelligence. If this examination is satisfactory, the applicant shall < e placed in the shop or power house where lie can be made familiar with the power and machinery he is about to control. He shall then be placed on a car with an instructor, and when the latter is satisfied as to the applicant's capability for the position of motorman or gripman, he shall so certify to the 21 RAILROAD LAW. officers of the company, and, if appointed, the applicant shall first serve on the lines of least travel. Any violation of the provisions of this section shall be a misdemeanor. Am'd by chap. 513 of 1895. Took effect May 2, 1895. 42a. Liability for injuries to employes. In all actions against a railroad corporation, foreign or domestic, doing business in this state, or against a receiver thereof, for personal injury to, or death resulting from personal injury of any person, while in the employment of such corporation, or receiver, arising from the neg- ligence of such corporation or receiver or of any of its or his officers or employes, every employe, or his legal representatives, shall have the same rights and remedies for an injury, or for death, suffered by him, from the act or omission of such corporation or receiver or of its or his officers or employes, as are now allowed by law, and, in addition to the liability now existing by law, it shall be held in such actions that persons engaged in the service of any railroad corporation, foreign or domestic, doing business in this state, or in the service of a receiver thereof, who are entrusted; by" such corpor- ation or receiver, with the authority of superintendence, control or command of other persons in the employment of such corpora- tion or receiver, or with the authority to direct or control any otjier employe in the performance of the duty of such employe, or who have, as a part of their duty, for the time being, physical control or direction of the movement of a signal, switch, locomotive engine, car, train or telegraph office, are vice principles of such corpor- ation or receiver, and are not fellow servants of such injured or deceased employe. If an employe, engaged in the service of any such railroad corporation, or of a receiver thereof, shall receive any injury by reason of any defect in the condition of the ways, works, machinery, plant, tools or implements, or of any car, train, locomotive or attachment thereto belonging, owned or operated, or being run and operated by such corporation or receiver, when such defect could have been discovered by such corporation or receiver, by reasonable and proper care, tests or inspection, such corpora- tion or receiver, shall be deemed to have had knowledge of such defect before and at the time such injury is sustained; and when 22 RAILROAD LAW. the fact of such defect shall be proved upon the trial of any action in the courts of this state, brought by such employe or his legal representatives, against any such railroad corporation or receiver, on account of such injuries so received, the same shall be prima facie evidence of negligence on the part of such corporation or re- ceiver. This 1 section shall not affect actions or causes of action now existing; and no contract, receipt, rule or regulation, between an employe and a railroad corporation or receiver, shall exempt or limit the liability of such corporation or receiver from the pro- visions of this section. Added by ch. 657 of 1906. In effect May 29, 1906. 43. ' Conductors and employes must wear badges. Every conductor and employe of a railroad corporation employed in a passenger train, or at stations for passengers, shall wear upon his hat or cap a badge, which shall indicate his office or employ- ment, and the initial letters of the corporation employing him. No conductor or collector without such badge shall demand or re- ceive from any passenger any fare or ticket or exercise any of the powers of his employment. No officer or employe without such badge shall meddle or interfere with any passenger, his baggage or property. A change of phraseology, so that the prohibition against the "exercise of any of the powers of his employment" without a badge is limited, as it was before, to the conductor or collector. 44. Checks for baggage. A check, made of some proper sub- stance of convenient size and form, plainly stamped -with num- bers, and furnished with a convenient strap or other appendage for attaching to baggage, shall be affixed to every piece or parcel of baggage when taken for transportation for a passenger by the agent or employe of such corporation, if there is a handle, loop or fixture therefor upon the piece or parcel of baggage, and a dupli- cate thereof given to the passenger or person delivering the same to him. If such check be refused on demand the corporation shall pay to the passenger the sum of ten dollars, and no fare shall 22a RAILEOAD LAW. be collected or received from him ; and if he shall have paid hig fare it shall be refunded to him by the conductor in charge of the train. Such baggage shall be delivered, without unnecessary de- lay, to the passenger or any person acting in his behalf at the place to which it was to be transported, where the cars usually stop, or at any other regular intermediate stopping place, upon notice to the baggage-master in charge of baggage on the train, of not less than thirty minutes, upon presentation of such duplicate check to the officer or agent of the railroad corporation, or of any corpora- tion, over any portion of whose road it was transported. Bicycles are hereby declared to be and be. deemed baggage for the purposes of this article and shall be transported as baggage for passengers by railroad corporations and subject to the same liabilities, and no such passenger shall be required to crate, cover or otherwise protect any such bicycle ; provided, however, that a railroad corporation shall not be required to transport, under the provisions of this act, more than one bicycle for a single person. Am'd by ch. 333 of 1896. Am'd by ch. 388 of 1902. In effect April 7, 1902. 45. Penalties for injuries to baggage. Any person, whose duty it is for or on behalf of the common carrier to handle, remove, or care for the baggage of passengers, who shall recklessly or will- fully injure or destroy any trunk, valise, box, bag, pack- age or parcel, while loading, unloading, transporting, de- livering or storing the same, or any railroad corpora- tion, which shall knowingly keep in its employment any such willful or reckless person, or which shall permit any 22b RAILROAD LANV. injury or destruction of such property, through failure to provide suffi- cient help and facilities for the handling thereof, shall pay to the pur: y injured thereby the sura of fifty dollars, in addition to such damage-. 46. Unclaimed freight and baggage. Every railroad or other transportation corporation, doing business in this state, which t-h;.;i have unclaimed freight or baggage, not live stock or perishable, in its possession for the period of sixty days may deliver the same to any warehouse company, or person or persons engaged in the warehouse business, within this state, and take a warehouse receipt for the storage thereof. Upon such delivery arid upon taking such warehouse receipt, every such railroad or other transportation corporation shall be dis- charged of all liability in respect to any unclaimed freight or baggage from and after such delivery. At any time within two years after sudi delivery, such railroad or other transportation corporation shall sur- render and transfer such warehouse receipt to the owner of any such unclaimed freight or baggage upon demand, and upon payment of all charges and expenses for transportation and storage then due, if a;:y, to any such railroad or other transportation corporation. In case any such railroad or other transportation company shall have had unclaimed freight or baggage, not live stock or perishable, in its possession for a period of one year and shall not have delivered the same, to a warehouse company or person or persons engaged in the warehouse business as above provided, then such railroad or other transportation company may proceed to sell the same at public auc- tion, and out of the proceeds may retain the charges of transporta- tion handling and storage of such unclaimed freight or baggage, and the expenses of advertising and sale thereof ; but no such sale shall be made until the expiration of four weeks from the first publication of notice of such sale to be published weekly in a newspaper pub- lished in or nearest the town or city to which such unclaimed freight or baggage was consigned, or at which it was directed to be left, and also at the town or city where such sale is to take place; and said notice shall contain a general description of such unclaimed freight or baggage, the name of the shipper thereof if known, and a state- ment of the consignment thereof, whether to a designated consignee or to order, if known, or the place, at which the same was to be left, as near as may be ; and the expenses incurred for advertising shall be a lien upon such unclaimed freight or baggage in a ratable pro- portion, according to the value of each article, package or parcel, i more than one. Such railroad or other transportation company shall 23 RAILROAD LAW. make an entry of the balance of the proceeds of the sale, if any, of the unclaimed freight or baggage consigned to the same consignee or covered by each consignment, as near as can be ascertaimed, and at any time within five years thereafter, shall refund any surplus so retained to the owners of such unclaimed freight or baggage, his per- sonal representatives or assigns, on satisfactory proof of such owner- ship. In case such balance shall not be claimed by the rightful owner within five years after the sale as above specified, then it shall be paid to the county treasurer, for the use of the county poor of the county where the sale is made. Unclaimed live stock and perishable freight or baggage may be sold by any such railroad or other transportation corporation with- out notice, as soon as it can be, upon the best terms that can be ob- tained. All moneys arising from the sale of any such unclaimed live stock, perishable freight or baggage, after deducting therefrom all charges and expenses for transportation, storage, keeping, commis- sions for selling the property, and any amount previously paid for its loss or non-delivery, shall be deposited by the corporation making such sale with a report thereof, and proof that the prop- erty was live stock or perishable freight, with the comptroller for the benefit of the general fund of the state, and shall be held bv him in trust for reclamation by the person or persons entitled to receive the same. Ain'd by ch. 582 of 1899. 47 Tickets and checks for connecting steamboats. The proprietors of any line of steamboats, terminating or stopping for pas- sengers at any place where a railroad corporation has a depot or station, may furnish tickets and baggage checks to such corporation for the use of passengers, traveling over its road, who desire to connect with such line of boats at any such place, and the railroad corporation sh.-iii sell such tickets and deliver a duplicate of one of such checks to any such passenger applying therefor, and shall account for and pa v over to the proprietor of such line of boats all moneys received by it for the sale of such tickets ; and any such railroad corporation may furnish 23a RAILROAD LAW. tickets and checks for baggage to the proprietors of any such line of steamboats for the use of passengers traveling over any part of such line of boats, who desire to connect with the railroad of any such corporation at any such place, and such proprietors shall sell such tickets and deliver a duplicate of one of such checks to any such passenger applying therefor, and shall account for and pay over to such corporation all moneys received by them for the sale of such tickets. No greater rate of fare shall be charged by any railroad corporation to any such passenger for the distance traveled over its road than is charged to travelers for the same distance whose trip ends at the place where connection is made with any such line of boats, and no greater rate of fare shall be charged by the proprietors of any such steamboat line to any such passenger for the distance traveled over its line, than is charged to travelers for the same distance whose trip ends at the place where connection is made with any such railroad. Any additional cost of transfer of a passenger or his baggage from railroad depot or station to steamboat landing, or from steamboat landing to depot or station, shall be borne by the pas- senger or the proprietors of the steamboat line or the railroad cor- poration at whose instance or for whose benefit such transfer is made. Every railroad corporation and the proprietors of any line of steam- boats, their agents or servants, who shall neglect or refuse to sell tickets or furnish a check to any passenger applying for the same, when the same shall have been furnished to them, shall pay to such passenger the sum of ten dollars, and no fare or toll shall be collected from him for riding over such road or upon such boats, as the case may be ; and in addition thereto any railroad corporation go neglecting or refusing, shall pay the proprietors of such line of boats two hundred and fifty dollars for each day it shall so neglect or refuse ; and the proprietors of any such line of boats so neglecting or refusing, shall pay to such railroad corporation a like sum for each day they shall so neglect or refuse. Every such railroad corporation shall also receive any freight which shall be delivered at any station on the line of its road, marked to go by way of boat or any particular line of boats from any station on its road at which such boat or line of boats terminates or stops for freight, and shall transport such freight with all convenient speed to such station, and on its arrival there cause the proprietors of the steamboat line by which it is directed to be sent, or their agent, to be notified of such arrival, and shall deliver such freight to such pro- prietors or their agent with the bill of charges thereon due such rail- road corporation, for the payment of which charges the proprietor or proprietors of such steamboat line shall be responsible, and shall ac- count for and pay the same to such railroad corporation on demand. 24 RAILROAD LAW. The railroad corporation shall not charge for the transportation of such freight over its road any greater sum pro rata than it charges for carrying the same kind of freight the same distance over its road, if it was to be transported by such corporation by rail to its final destination, or to the terminus of the road of such corporation in case it terminates before such final destination is reached. Any freight delivered by the proprietors of any steamboat or steamboat line, or their authorized agent, at any station, at a place where such steam- boat or steamboats have a landing, to any such railroad corporation, for transportation over its road or any part thereof, shall be transported by such corporation to its place of destination for the same price pro rata which would be charged for the same kind of freight the same distance over its road, if the same had been taken on at the point of first shipment by boat, or at the terminus of the road of such corpora- tion, in case it does not extend to the point of first shipment. 48. Rights and liabilities as common carriers. Every rail- road corporation doing business in this state shall be a common carrier. Any one of two or more corporations owning or operating connecting roads, within this state, or partly within and partly without the state, shall be liable as a common carrier, for the transportation" of passen- gers or delivery of freight received by it to be transported by it to any place on the line of a connecting road ; and if it shall become liable to pay any sum by reason of neglect or misconduct of any other corporation it may collect the same of the corporation by reason of whose neglect or misconduct it became liable. 49. Switches ; warning signals ; guard-posts ; automatic couplers ; automatic or other safety brake ; tools in passenger car ; -water. It shall be the duty of every railroad corporation operating its road by steam : 1. To lay, in the construction of new and in the renewal of existing switches, upon freight or passenger main line tracks, switches on the principal of either the so-called Tyler, Wharton, Lorenze, or split- point switch, or some other kind of safety switch, which shall prevent the derailment of a train, when such switch is misplaced or a switch interlocked with distant signals. 2. To erect and thereafter maintain such suitable warning signals at every road, bridge, or structure which crosses the railroad above the tracks, where such warning signals may be necessary, for the protec- tion of employes on top of cars from injury. Subdivision b repealed. Repealed by chap. r <4U ot 1900. In effect May 2, 1900. RAILROAD LA\\. 4. To use upon every new freight car, built or purchased for use, couplers -which can be coupled and uncoupled automatically, without the necessity of having a person guide the link, lift the pin by hand, or go between tha ends of the cars. 5. To attach to every car used for passenger transportation an automatic air-brake or other form of safety-power brake, applied from the. loconiotiv , excepting cars attached to freight trains, the schedule rate of speed of which does not exceed twenty miles an hour. G. To provide each closed car in use in every passenger train owned or regularly used upon a railroad, with one set of tools, consisting of an axe, sledge hammer, crowbar and hand saw and such other or additional tools as the board of railroad commissioners may require, to be placed where directed by the board of railroad commissioners. Am'd by ch. 521 of 1898. 7. To provide, in each passenger car, where the line of road shall exceed forty continuous miles in length, a suitable receptacle for water, with a cup or drinking utensil attached upon or near such receptacle, and to keep such receptacle, while the car is in use, constantly supplied with cool v Every corporation, person or persons, operating such railroad, and violating any of the provisions of this section, except subdivision seven, shall be liable to a penalty of one hundred dollars for each offense, and the further penalty of ten dollars for each day that it shall omit or neglect to comply with any of such provisions. For every violation of the provisions of the seventh subdivision of this section, every such corporation shall be liable to a penalty of twenty-five dollars for each offense. 49-a. Inspection of locomotive boilers. It shall be the duty of every railroad corporation operated by steam power, within this state, and of the directors, managers or superintendents of such railroad to cause thorough inspections to be made of the boilers of all the locomotives which shall be used by such corporation or corporations, on said railroads. Said inspections shall be made, at least once every three months, by competent and qualified inspectors of boilers, under the direction and superintendence of said cor- poration or corporations, or the directors, managers or superintendents thereof. The person or persons who shall make said inspections, shall make ana subscribe his name to a written or printed certificate which shall contain tue number of each boiler inspected, the date of its inspection, the condi- tion of the boiler inspected, and shall cause said certificate or certificates to be filed in the office of the railroad commissioners, within ten days after each inspection shall be made, and also with the officer or employee of such railroad having immediate charge of the operation of such locomotive. It it shall be ascertained by such inspection and test, or otherwise, that any locomotive boiler is unsafe for use, the same shall not again be used until it shall be repaired, and made safe. A certificate of a boiler inspector to me effect that the same is in a safe condition for use shall be made and filed in the office of the railroad commissioners. Every corporation, director, manager or superintendent operating such railroad and violating any of the provisions of this section shall oe liable to a penalty, to be paid to the people of the state of New York, of one hundred dollars for each offense, and the further penalty of one hundred dollars for each uay it or they shall omit or negiecc to comply wiih said provisions, and the making or filing of a false certificate shall be a misdemeanor. Any person, upon application to the secretary of said board of railroad commissioners and on the payment of such reasonable fee as said board may by rule fix, shall be furnished with a copy of any such certificate. Added by ch. 611 of 1905. In effect May 25, 1905. 49-b State inspector of locomotive boilers. Within twenty days after this section takes effect, the state railroad commission shall appoint a com- petent person as inspector of locomotive boilers, who shall receive a com- pensation to be fixed by the commission, not exceeding three thousand dollars per year. Such inspector shall, unuer the direction of the commission, inspect boiler-- or locomotives used by railroad corporations operating steam railroad* within the state, and ma\ cause tne same to be tested by hydrostatic test and shall perform s'loh other duties in connection with the inspection and test c>f locomotive boilers as the commission shall direct. But this section shall not relieve any railroad corporation from the duties imposed by the pieceding section Added by ch. 611 of 1905. In effect May 25, 1905. RAILROAD LAW. 50. Railroad commissioners may approve other safeguards. The board of railroad commissioners may, on the application of any railroad corporation, authori/e it to use any other safeguard or device approved by the board, in i.i' any safeguard or device required by this article, which shall there- at UT In- used in lien thereof, and the same penalties' for neglect or refusal to use the same shall be incurred and imposed as for a failure to use the safeguard or device hereinbefore required, in lieu of which the same is to oi- used. ' 51. Use of stoves or furnaces prohibited. It shall not be lawful for any railroad corporation, operating a steam railroad in this state, of the length of fifty miles of more, excepting foreign railroad corporations, incorporated without the jurisdiction of the United States, running cars upon tracks in this state for a distance of less than thirty miles, to heat its passenger cars, on other than mixed trains, excepting dining-room cars, by any stove or furnace kept inside the car, or suspended therefrom, unless in case of accident or other emergency, when it may temporarily use such stove or furnace with necessary fuel, in cars which have been equipped with apparatus to heat by steam, hot water or hot air from the locomotive, or from a special car, the present stove may be retained to be used only when the car is standing still, and no stove or furnace shall be used in a dining-room car, except for cooking purposes, and of pattern and kind to be approved -y the railroad commissioners. This section shall not be held to affect or interfere with the use by the commissioners of fisheries of this or other states, or of tin- l"n!ted States, of stoves for heating or cooking or boilers for hatching operations in their fish car or cars. Any person or corporation, violating any of the provisions of this section, shall be liable to a penalty of one thousand dollars, and to the further penalty of one hundred dollars for each and every day during which such violation shall continue. Am'd by chap. 299 of 1896. In effect April 17, 1896. 52. Canada thistles to be cut. Every railroad corporation doing business within this state, shall cause all Canada thistles, white and yellow daisies any other noxious weeds growing on any lands owned or occupied by it, to bo cut down twice in each and every year, once between the fifteenth day of June and the twenty-fifth day of June, and once between the fifteenth day of August and the twenty-fifth day of August. If any such corporation shall neglect to cause the same to be so c\\t down, anv person may cut the same, between the twenty-fifth day of June and the fifth day of July inclusive, and between the twenty-fifth day of August and the fifth day ;-f September inclusive in each year, at the expense of the corporation on wnose lands the same shall be so cut, at the rate of three dollars per day !''>! tne time occupied in cutting. 53. Riding on platform ; walking along track. No railroad corporation shall be liable for any injury to any passenger while on the platform of a car, or in any bag-gage, wood or freight car, in viola- ii,m of the printed regulations of the corporation, posted up at the time iii a conspicuous place inside of the passenger cars, then in the train, it there shall be at the time sufficient room for the proper accommoda- tion of the passenger inside such passenger coach. No person other than those connected with or employed upon the railroad shall walk upon or along its track or tracks, except where the same shall be laid across or along streets or highways, in which case he shall not walk upon the track unless necessary to cross the same. Any person riding, leading or driving any horse or other animal upon any railroad, or within the fences and guards thereof, other than at a farm or street or forest crossing, without the consent of the corporation, shall forfeit to th-i people of the state the stun of ton dollars, and pay all damages ained thereby to the party aggrieved. L. 1850, <:h. 140, 44. 54. Corporations may establish ferries. Any steam railroad corporation, incorporated under the laws of this state, with a terminus in the harbor of New York, may purchase or lease boats propelled by 27 RAILROAD LAW. steam or otherwise, and operate the same as a ferry or otherwise, over the waters of the harbor of New York, but this section shall not, be construed t;> aii'.-cf the rights of the cities of 2s<:\v York ami Brooklyn. 55. Certain railroads may cease operation in winter. The directors of any railroad corporation operating a railroad, con.strii' ' -r months, or for summer travel, may, by a resolution duly pa.----d at, a meeting thereof, apply to the board of railroad commissioners for permission to cease the operation of their road during the winter sea- BOII, for a period, not exceeding seven months in any one year, speci- fying the date of such suspension, and the date of the reopening thereof; and such board may, in their discretion, make an order granting the application wholly or in part, and thereupon such rail- road corporation shall be relieved of the duty of operating its road during the period specified in the order. A copy of such order shall be posted in all the depots and at the termini of such railroad, and published in every newspaper in each town in any part of which such road shall be constructed at least four weeks prior to the date of such suspension. 56. Mails. Any railroad corporation shall, when applied to by the Postmaster-General, convey the mails of the United States on its road, and in case such corporation and the Postmaster-General shall not agree as to the rate of transportation therefor, and as to the time, rate of speed, manner and condition of carrying the same, the board of railroad commissioners shall fix the prices, terms and conditions therefor, after giving the corporation reasonable opportunity to be heard. Such price shall be not less for carrying such mails in the regu- lar passenger trains than the amount which such corporation would re- ceive as freight on a like weight of merchandise transported in their merchandise trains, and a fair compensation for the post-office car. If the Postmaster-General shall require the mail to be carried at other hours, or at higher speed than the passenger trains are run, the cor- poral ion shall furui.-h an exira train for the mail, and be allowed an extra compensation for the expenses and wear and tear thereof, and for. the service to be fixed as herein provided. Every railroad corporation refusing or neglecting to comply with any provision, of this section shall forfeit to the people of the state one hundred dollars for every day such neglect or refusal continues. L. 1847, ch. 21.'), 17. 57. Corporations must .make annual report. Every person or corporation owing, leasing, operating or in possession of a railroad, wholly or partly, in this state, shall make an annual report to the 28 RAILROAD LAW. board of railroad commissioners of its operations for the year ending with June thirtieth, and of its condition on that day which shall be verified by the oaths of the president, or treasurer, and the general manager, or acting superintendent, and shall be filed in the office of such board on or before September first in each year. Every such person or corporation shall make quarterly and further reports to such board in the form and within the time prescribed by it. Such board may in its discretion change the date of the annual report and of filing the same, but the length of time between the date of the annual report and the filing of the same shall not be less than herein pre- scribed. Any person or railroad corporation which shall neglect to m ike any such report, or which shall fail to correct any such report wuhin ten days after notice by the board of railroad commissioners, shall be liable to a penalty of two hundred and fifty dollars, and an a Iditional penalty of twenty-five dollars for each day after September first on which it shall neglect to file the same, to be sued for in the name of the people of the state of New York, for their use. The board of railroad commissioners may extend the time herein limited for cause shown. L. 1890, ch. 98, 2. 58. "When conductors and brakemen may be policemen. The governor may appoint any conductor or brakeman on any train conveying passengers on any steam railroad in this state, a policeman, with all the powers of a policeman in cities and villages, for the pres- ervation of order and of the public peace, and the arrest of all per- sons committing offenses upon the land or property of the corporation owning or operating such railroad ; and he may also appoint, on the application of any such corporation or of any steamboat company, such additional policemen, designated by it, as he may deem proper, who shall have the same powers. Every such policeman shall within fifteen days after receiving his commission, and before en- tering upon the duties of his office, take and subscribe the constitu- tional oath of office, and file it with his commission in the office of the secretary of state. Every such policeman shall when on duty wear a metallic shield, with the words "railway police," or "steam- boat police," as the case may be, and the name of the corporation for which appointed inscribed thereon, which shall always be worn in plain view, except when employed as a detective. The compensa- tion of every such policeman shall be such as may be agreed upon between him and the corporation for which he is appointed, and 29 RAILROAD LAW. shall be paid by the corporation. When any corporation shall no longer require the services of any such policeman they may file notice to that effect in the office in which notice of his appointment was originally filed, and thereupon such appointment shall cease and be at an end. Am'd by ch. 609 of 1899. Am"d by ch. 380 of 1906. 59. Requisites to exercise of powers of future railroad corporations. No railroad corporation hereafter formed under the laws of this State shall exercise the powers conferred by law upon -such corporations or begin the construction of its road until the directors shall cause a copy of the articles of association to be pub- lished in one or more newspapers in each county in which the road is p-oposed to be located, at least once a week for three successive weeks, and shall file satisfactory proof thereof with the board of railroad commissioners ; nor until the board of railroad commissioners shall certify that the foregoing conditions have been complied with, and also that public convenience and a necessity require the construction of said railroad as proposed in said articles of association. The fore- going certificate shall be applied for within six months after the com- pletion of the three weeks' publication hereinbefore provided for. If certificate is refused no further proceedings shall be had before said board, but the application may be renewed after one year from the date of such refusal. Prior to granting or refusing said certificate the board shall have a right to permit errors, omissions or defects to be .supplied and corrected. After a refusal to grant such certificate the board shall certify a copy of all maps and papers on file in its office and of the findings of the board when so requested by the directors aforesaid. Such directors may thereupon present the same to a general term of the supreme court of the department within which said road is proposed in whole or in part to be constructed, and said general term shall have power, in its discretion, to order said board, for reasons stated, to issue said certificate, and it shall be issued ac- cordingly. Such certificate shall be filed in the office of the secretary of state, and a copy thereof, certified to be a copy by the secretary of state, or his deputy, shall be evidence of the fact therein stated. Nothing in this section shall prevent any such railroad corporation from causing such examinations and surveys for its proposed railroad to be made as may be necessary to the selection of the most advan- tageous route ; and for such purpose by its officers or agents and ser- vants, to enter upon the lands or water of any person, but subject to ;vhe responsibility for all damages which shall be done thereto. Am'd by chap. 545 of 1895. Took effect May 23, 1895. 30 RATLKOAD LAW. ! 59a. Railroad commissioners may certify part of the route of a street surface railroad. Power to revoke certificates. Street surface railroad extension. Whenever application is made by a street surface railroad company for a certificate of public convenience and a necessity as required by the provisions of the foregoing section, and it shall ap- pear to the board of railroad commissioners, after examination of the proposed route of the applicant company that public convenience and a necessity do not require the construction of said railroad as proposed in its articles of association but do require the construction of a part of the said railroad, the board of railroad commissioners may issue its certifi- cate for the construction of such part of the said railroad as seems to it to be required by public convenience and a necessity. In case any rail- road company which shall hereafter obtain the certificate of the board of railroad commissioners that public convenience: and a necessity require the construction of the whole or a part of the said railroad shall fail to begin such construction within two years from the date of the issuing of said certificate, the board of railroad commissioners may inquire into the reason for such failure and the said board may revoke said certificate if it shall appear to it to be in the public interest BO to do. Any street surface railroad company which proposes to extend its road beyond the limits of any city or incorporated village by a route which will be prac- tically parallel with a street surface railroad already constructed and in operation shall first obtain the certificate of the board of railroad com- missioners that public convenience and a necessity require the construc- tion of such extension as provided in the case of a railroad corporation newly formed. Before making application for such certificate the cor- poration shall cause to be advertised the route of the proposed extension in one or more newspapers in each county in which such extension is to be constructed, at least once a week for three successive. weeks, and shall file satisfactory proof of such publication with the board of rail- road commissioners. Nothing in this section shall prevent street rail- road companies from making extensions within the limits of cities or incorporated villages upon compliance with the provisions of law now applicable thereto. [Added ch. 643 of 1898.] Amended by ch. 226 of 1902. In effect March 26, 1902. 59b. Whenever it shall be made to appear to the board of railroad commis- sio'ners that any steam railroad corporation, which has obtained from it a certifi- cate under bection fifty-nine of the railroad law since eighteen hundred and ninety- four and whose road is less than ten miles in length, and was to be built in the counties of Saratoga and Washington, shall not have completed its construction ami put it in operation within ihree years after obtaining such certificates, the said board, on notice to such corporation, shall have the power to revoke the said cer- tificate and consent and thereupon the corporate existence and power of such rail- road corporation shall cease and determine. Added by ch. 597 of 1899. GO. All steam surface railroads, hereafter built except additional switches and sidings, must be so constructed as to avoid all public crossings at grade, when ever practicable so to do. Whenever application is made to the board of railroad commissioners, under section fifty-nine of the railroad law, there shall be filed with said board a map showing the streets, avenues and highways proposed to be crossed by the new construction, and the said board shall determine whether such crossing shall be under or over the proposed railroad, except where said board shall determine such method of crossing to be impracticable. Whenever aii ap- plication is made under this section to determine the manner of crossing, the said hoard shall designate a time and place when and where a hearing will be given to said railroad company, and shall notify the municipal corporation having jurisdic- ti PI over such streets, avenues or highways proposed to be crossed by the new railroad. The said board shall also give public notice of such hearing in at least two newspapers published in the locality ulfected by the application, and all persons owning land in the vicinity of the proposed crossings shall have the right to be heard. The decision of the said board rendered in any pr jc.cei lings under this section shall be communicated, within twenty days after final hearing, to all parties to whom notice of the hearing, in said 30a firoceedings was given, or who appeared at said hearing by counsel < r in person. [Added, cii. 754 of 1897. Li effect July 1, 1897.] 61. When a new street, avenue or highway, or new portion of a t treet, avenue or highway shall hereafter he constructed ad f team surface railroad other than pursuant to the provisions of section fixty-two of this act. such street, avenue or highway or portion of ?uch street, avenue or highway, shall pass over or under such rail- road or at grade as the board of railroad commissioners shall dii Notice of intention to lay out such street, avenue or hi^hv or new portion of a street, avenue or highway, across a steam surface railroad, shall be given to such railroad company by the municipal corporation at least fifteen days prior to the making of the order laying out such street, avenue or highway by service per- sonally on the president or vice president of the railroad corporation, or any general officer thereof. Such notice shall designate the time and place and when and where a hearing will be given to such railroad company, and such railroad company shall have the right to be heard before the authorities of such municipal corporation upon the ques- tion of the necessity of such street, avenue or highway. If the mu- nicipal corporation determines such street, avenue or highway to be necessary, it shall then apply to the board of railroad commissioners before any further proceedings are taken, to determine whether such street, avenue or highway shull pass over or under such railroad, or at grade, whereupon the said board of railroad commissioners shall appoint a time and place for hearing such application, and shall give such notice thereof, as they judge reasonable, not, however, less than ten days, to the railroad company whose railroad is to be crossed by such new street, avenue or highway, or new portion of a street, ave- nue or highway, to the municipal corporation and to the owners of land adjoining the railroad and that part of the street, avenue or highway to be opened or extended. The said board ot railroad com- missioners shall determine whether such street, avenue or highway, or new portion of a street, avenue or highway, shall be constructed over or under such railroad or at grade: and if said board determine that such street, avenue or highway shall be carried across such rail- road above grade, then such board shall determine the height, the length and the material of the bridge or structure by means of which such stre-'t, avenue or highway shall be carried across such railroad, and the length, character and grades of the approaches thereto; and if said board shall determine that such street, avenue or highway shall be constructed or extended below the grade, said board shall 30b determine the manner and method in which the same shall be so carn<_-ii under, and the grade or grades thereof, and if said board shall determine that said street, avenue or highway shall be constructed or extended at grade, said board shall determine the manner and method in which the same shall be carried over said railroad at grade and what safeguards shall be maintained. The decision of the said board as to the manner and method of carrying such new street, avenue or highway, or new portion of a street, avenue or highway across such railroad, shall be final, subject, however, to the right of appeal hereinafter given. The decision of said board rendered in any proceeding under this section shall be communicated within twenty days after final hearing to all parties to whom notice of the hearing in such proceeding was given or who appeared at such hearing by counsel or in person. [Am'd ch. 520 of 1898]. 62. The mayor and common council of any city, the president and trustees of any village, the town board of any town within which a street, avenue or highway crosses or is crossed by a steam surface railroad at grade, or any stearn surface railroad company, whose road crosses or is crossed by a street, avenue or highway at grade, may bring their petition, in writing, to the board of railroad commissioners, therein alleging that public safety requires an altera- tion in the manner of such crossing, its approaches, the method of crossing, the location of the highway or crossing, the closing and discontinuance of a highway crossing and the diversion of the travel thereon to another highway or crossing, or if not practicable to change such crossing from grade or to close and discontinue the same, the opening of an additional crossing for the partial diversion of travel from the grade crossing and praying that the same may be ordered ; whereupon the said board of railroad commissioners shall appoint a time and place for hearing the petition, and shall give such personal notice thereof as they shall judge reasonable, of not less then ten days, however, to said petitioner, the railroad company, the municipality in which such crossing is situated, and ,to the owners of the lands adjoining such crossing and adjoining that part of the highway to be changed in grade or location, or the land to be opened for a new crossing, and shall cause notice of said hearing to be advertised in at least two newspapers published in the locality affected by the applica- tion ; and after such notice of hearing the said board of railroad com- missioners shall determine what alterations or changes, if any, shall be made. The decision of said board of railroad commissioners rendered in any proceeding under this section, shall be comrnuni- 30c catcd within twenty days after final hearing to all parties to whom notice of the hearing in said proceeding was given, or who appeared at said hearing by counsel or in person. Any person aggrieved by su<-h decision, or by a decision made pursuant to sections sixty and sixty-one hereof, and who was a party to said proceeding, may within sixty days appeal therefrom to the appellate division of the supreme court in the department in which such grade crossing is situated and to the court of appeals, in the same manner and with like effect as is provided in the case of appeals from an order of the supreme court. A n i'd by ch. 359 of 1899. 63. The municipal corporation in which the highway crossing is located, may with the approval of the railroad company, acquire by purchase any lands, rights or easements necessary or required for the purpose of carrying out the provisions of sections sixty, sixty-one and sixty-two of this act, but if unable to do so shall acquire such lands, rights or easements by condemnation either under the condemnation law, or under the provisions of the charter of such municipal corpora- tion. The railroad company shall have notice of any such proceedings and the right to be heard therein. Am'd by ch. 226 of 1899. 64. When a highway crosses a railroad by an overhead bridge, the frame work of the bridge and its abutments shall be maintained and kept in repair by the railroad company, and the roadway thereover and the approaches thereto shall be maintained and kept in repair by the municipality in which the same are situated; except that in the case of any overhead bridge constructed prior to the enactment of sections sixty-one and sixty-two of this act, the roadway over and the approaches to which the railroad company was under obligation to maintain and repair, such obligations shall continue, provided the railroad company shall have at least ten days' notice of any defect in the roadway thereover and the approaches thereto, which notice must be given in writing by the commissioner of highways or other duly constituted authorities, and the railroad company shall not be liable by reason of any such defect unless it shall have failed to make repairs within ten days after the service of such notice upon it. When a highway passes under a rail- road, the bridge and its abutments shall be maintained and kept in repair by the railroad company, and the subway, and its approaches shall be maintained and kept in repair by the municipality in which the same are situated. Added ch. 754 of 1897. In effect July 1, 1897. Am'd by ch. 140 of 1902. In effect March 13, 1902. 65. Whenever, under the provisions of section sixty of this act, new railroads are constructed across existing highways, the expense of crossing above or below the grade of the highway shall be paid en- tirely by the railroad corporations. Whenever under the provisions of section sixty-one of this act a new street, avenue or highway is constructed across an existing railroad, the railroad corporation shall pay one-half and tfhe municipal corporation wherein such street, avenue or highway is located, shall pay the remaining one-half of the expense of making such crossing above or below grade; and whenever a change is made as to an existing crossing in accordance with the provisions of section sixty-two of this act, fifty per centum of the expense thereof shall be borne by the railroad corporation, 30d twenty-five per centum by the municipal corporation, and twenty five per centum by the state. Whenever, in carrying out the pro- visions of sections sixty-one or sixty-two of this act, two or mov lines of steam surface railroad, owned and operated by different cor* porations, cross a highway at a point where a change in grade ia made, each corporation shall pay such proportion of fifty per centum of the expense thereof as shall be determined by the board of rail- road commissioners. In carrying out the provisions of sections sixty, sixty-one and sixty-two of this act the work shall be done by the railroad corporation or corporations affected thereby, subject to the supervision of and approval of the board of railroad commission- ers, and in all cases, except where the entire expense is paid by the railroad corporation, the expense of construction shall be paid primarily by the railroad company, and the expense of acquiring ad- ditional lands, rights or easements, shall be paid primarily by the municipal corporation wherein such highway crossings are located. Plans and specifications of all changes proposed under sections sixty-one and sixty-two of this act, and an estimate of the expense thereof shall be submitted to the board of railroad commissioners for their approval before the letting of any contract. In case the work is done by contract the proposals of contractors shall be submitted to the board of railroad commissioners, and if the board shall deter- mine that the bids are excessive it shall have the power to require the submission of new proposals. The board of railroad commis sioners may employ temporarily such experts and engineers as may be necessary to properly supervise any work that may be undertaken under sections sixty, sixty-one or sixty-two of this act, the expense thereof to be paid by the comptroller upon the requisition and cer- tificate of the said board, said expense to be included in the cost of the particular change in grade on account of which it is incurred and finally apportioned in the manner provided in this section. Upon the completion of the work and its approval by the board of railroad commissioners an accounting shall be had between the railroad cor- poration and the municipal corporation, of the amounts expended by each with interest, and if it shall appear that the railroad corporation or the municipal corporation have expended more than their propor- tion of the expense of the crossing as herein provided, a settlement shall be forthwith made in accordance with the provisions of this sec- tion. All items of expenditure shall be verified under oath, and, in case of a dispute between the railroad corporation and the municipal corporation as to the amount expended, any judge of the supreme court in the judicial district in which the municipality is situated may appoint a referee to take testimony as to the amount expended, 30e and the confirmation of the report of the referee shall be final. la the event of the failure or refusal of the railroad corporation to pay its proportion of the ex [Minso, the same, with interest from the date of such accounting, may be levied and assessed upon the railroad corporation and collected in the same manner that taxes and assess- ments are now collected by the municipal corporation within which the work is done; and in the event of the failure or refusal of the municipal corporation to pay its proportion of the expense, suit may be instituted by the railroad corporation for the collection of the same with interest from the date of such accounting, or the railroad cor- poration may offset such amount with interest against any taxes levied or assessed against it or its property by such municipal corporation. The legislature shall annually appropriate out of any moneys not otherwise appropriated, the sum of one hundred thousand dollars for the purpose of paying the state's proportion of the expense of a change in an existing grade crossing. If, in any year, any less sum than one hundred thousand dollars is expended by the state for the purpose aforesaid the balance remaining unexpended shall be applied to reduce the amount appropriated by the state in the next succeed- ing vear, except that no such deduction shall be made in case there are outstanding and unadjusted obligations on account of a change in an existing grade crossing fora portion of which the state is liable under the provisions of this section. In the event of the appropria- tion made by the state in any one year being insufficient to pay the state's proportion of the expense of any change that may be ordered the first payment from the appropriation of the succeeding year shall be on account of said change, and no payment shall be made on ac- count of any subsequent change that may be ordered, nor .shall any subsequent change be ordered until the obligation of the state on ac- count of the first-named change in grade ha.3 betm fully discharged, unless the same shall be provided for by an additional appropriation to be made by the legislature. The state's proportion of the expense of changing any existing pade crossing shall be paid by the state treasurer on the warrant of the comptroller, to which shall be appended the certificate of the board of railroad com- missioners to the effect that the work has been properly per- formed and a statement showing the situation of the crossing that has been changed, the total cost and the proportionate expensa thereof, and the money shall be paid in whole or in part to t li- ra ihoad corporation or to the municipal corporation as the board of railroad commissioners may direct, subject, however, to the rights of the respective parties as they api>ear from the account- ing to be had as hereinbefore provided for. No claim for 83. Liabilities of reorganized railroad corporations. A railroad corporation, reorganized under the provisions of law, relating to the formation of new or reorganized corporations upon the sale of their property or franchise, shall not be compelled or required to extend its road beyond the portion thereof constructed, at the time the new or reorganized corporation acquired title to su ii railroad property and franchise, provided the board of railroad commis- sioners of theState shall certify that in their opinion the public interests umier all the circumstances do not require such extension. If such board shall so certify and shall file in their office such certificate, which certificate shall be irreversible by such board, such corporation shall not be deemed to have in- curred any obligation so to extend its road and such certificate shall be a bar to any proceedings to compel it to make such extension or to annul its exist ence for failure so to do, and shall be final and conclusive in all courts and proceedings whatever. This section shall not authorize the abandonment of any portion of a railroad which has been constructed and operated, or apply to Kings county. 84. All the provisions contained in the several sections of this act shall ex- tend, apply to and cover the consolidation, lease, sale or reorganization of any railroad or other corporation heretofore or hereafter organized, under the laws of this State, and any other State or country, to build, lease, buy, sell, main- tain or operate any of the lines or routes of railroads, tunnels, bridges, ferries or branches or any part thereof mentioned in this article, and any similar lines -or routes of railroad, tunnels, bridges, ferries or any part thereof, constructed or to be located and constructed in any foreign country. Added by chap. 921 of 1895. Took effect June 5, 1895. ARTICLE IV. STREET SURFACE RAILROADS. SECTION 90. Street surface railroads ; general provision. 91. Consent of property owners and local authorities. 92. Consent of local authorities ; how procured. 93. Condition upon which consent shall be given ; sale of franchise at public auction. 94. Proceedings if property owners do not consent. 95. Percentage of gross receipts to be paid in cities or villages ; report of officers. 96. Extension of route over rivers; terminus in other counties; when property owners withhold consent ; supreme court may appoint commissioners. 97. Use of tracks of other roads. 98. Repair of streets ; rate of speed ; removal of ice and snow. 99. Within what time road to be built. 100. Motive power. 101 Rate of fare. 102. Construction of road in streets where other road is built. 103. Abandonment of part of route. 104. Contracting corporations to carry for one fare ; penalty. 105. Effect of dissolution of charter as to consents. 38 KAILROAD LAW. 106. Corporate rights saved in case of failure to complete road; right to operate oranches; conditions; former consents ratified; limitations. 107. When sand may be used on tracks. 108. Road not to be constructed upon ground occupied by public buildings or in public parks. 109. Center-bearing rails prohibited. 110. Eight to cross bridge substituted for bridge crossed for five years. 111. Protection of employes. llla.Protection to employes. 112. Local authorities may contract with railroad corporations. 90. Street surface railroads ; general provisions. The provisions of this article shall apply to every corporation which, under the provisions thereof, or of any other law, has constructed or shall construct or operate, or has been or shall be organized to construct or operate, a street surface railroad, or any extension or extensions, branch or branches thereof, for public use in the conveyance of persons and property for compensation, upon and along any street, avenue, road, highway or private property, in any city, town or village, or in any two or more civil divisions of the State, and every such corporation must comply with the provisions of this article. Any street sur- face railroad corporation, at any time proposing to extend its road or to con- struct branches thereof, may, from time to time, make and file in each of the offices in which its certificate of incorporation is filed, a statement of the names and description of the streets, roads, avenues, highways and private property in or upon which it is proposed to construct, maintain or operate such extensions or branches. Upon filing any such statement and upon com- plying with the conditions set forth in section ninety-one of the railroad law, every such corporation shall have the power and privilege to construct, ex- tend, operate and maintain such road, extensions or branches, upon and along the streets, avenues, roads, highways and private property named and de- scribed in its certificate of incorporation or in such statement. Every such corporation, before constructing any part of its road upon or through any private property described in its articles of association or certificate of incor- poration or statement, and before instituting any proceeding for the condem- nation of any real property, shall make a map and profile of the route adopted by it upon or through any private property, which map and profile shall be certified by the president and engineer of the company, or a majority of its directors, and shall be filed in the office of the clerk of the county in which the road is to be constructed, and all provisions of section six of the act hereby amended so far as applicable shall apply to the route so located. If any such street surface railroad company is unable to agree for the purchase of any such real property, or of any right or easement therein required for the purpose of its railroad, or if the owner thereof shall be incapable of sell- ing the same, or if, after diligent search and inquiry, the name and resi- dence of such owner can not be ascertained, it shall have the right to acquire title thereto by condemnation in the manner and by the proceedings pro- vided by the condemnation law. Nothing in this section shall be deemed to- authorize a street railroad corporation to acquire real property within a city by condemnation. Am'd by chap. 933 of 1895. Took effect June 6, 1895. 91. Consent of property owners and local authorities. A street surface railroad, or extensions or branches thereof shall not be built, extended or operated unless the consent in writing acknowledged or proved as are deeds entitled to be recorded, of the owners, in cities and villages, of one-half, in value, and in towns, not within the corporate limits of a city or village, of the owners of two-thirds in value, of the property bounded on, and also tue consent of the local authorities having control of that portion of a street or highway upon which it is proposed to build or operate such railroad, exten- sion or branch shall have been first obtained. Such consents of property owners in the county of Kings which shall be hereafter executed, may be forfeited unless within sixty days after the execution thereof, the same shaii be recorded in the office of the register of such county. Such register is hereby directed upon the payment of the proper fees to record all consen s left with him for that purpose in books to be provided by him and paid for out of the funds provided to meet the expenses of said office. Such books shall be indexed according to the names of the consenting property owners and also according to the names ol the streets, roads or other highways upon which the property to which the consent relates shall be hounded on. Ji case the recording of such consents shall be hindered, delayed or prevented by legal proceedings in any court or from any other or different cause not 39 RAILKOAD LAW. within the control of the corporation upon which such requirement is imposed, the time for the performance of such act is hereby and shall be deemed to be extended for the period covered by such hindrance, delay or prevention. The consents of property owners in one city, village or town, or in any other civil division of the state, shall not be ef any effect in any other city, village or town, or other civil divisions of the state. Consents of property owners heretofore obtained to the building, extending, operating or i-h of, motive power shall be effectual for the purposes herein mentioned an 1 may be deemed to be sufficiently proved and shall be entitled to be recorded, wherever suca consents shall have been signed, executed or acknowledgea before an officer authorized by law to take acknowledgments of deeds, or before 01 in the presence of a subscribing witness, and without regard to whether or not the subscribing witness shall have affixed his signature in the presence of the subscriber, provided that the proof of such signing, execution or acknowledgment shall have been made by such subscribing witness in the manner prescribed by chapter three, part two of the revised statutes. In cities the common council acting subject to the power now possessed by the mayor to veto ordinances; in villages the board of trustees, and in towns the commissioner or commissioners of highways shall be the local authoriti* -. referred to; except that in villages where the control of the streets is vested in any other board or authorities, such other board or authorities shall be the local authorities referred to, and the consent of such other board or authorities hereafter or heretofore obtained shall be sufficient; if in any city or county the exclusive control of any street, avenue or other property, which is to be used or occupied by any such railroad, extension or branch, is vested in any other authority, the consent of such authority shall also be first obtained. The value of the property above specified shall be ascertained and determined by the assessment roll of the city, village or town in which it is situated, completed last before the local authorities shall have given their consent, except property owned by such city, vil- lage or town, or by the state of New York, or the United States of America, the value of which shall be ascertained and determined by making the value thereof to be the same as is shown by such assess- ment roll to be the value of the equivalent in size and frontage of the adjacent property on the same street, or highway ; and the con- sent of the local authorities shall operate as the consent of such city, village or town, as the owners of such property. Whenever heretofore or hereafter a railroad has been or shall be constructed and put in operation for one year or the motive power thereon has been or shall be changed and put in operation for a similar length of time, such facts shall be presumptive evi- dence that the requisite consents of local authorities, property owners and other authority to the construction, maintenance and operation of such railroad or change of motive power have been duly obtained. No consent of local authorities heretofore given shall be deemed invalid because of any portion of the road or route consented to not being connected with an existing road or route of the corporation obtaining or acquiring such consent and all statements of extension filed under section ninety of this article in reference to the route or part thereof described in any consent of local authorities are hereby ratified and confirmed, whether the same were filed before or after the obtaining or ac- quiring of such consents, provided however that nothing herein con- tained shall be construed to affect any portion of a street surface railroad which is now in or upon any portion of a street which is -antler the jurisdiction of a park department in any city containing a population of over twelve hundred thousand inhabitants. -\mendod by ch. ns of 1001. In effect May 4, 1901. Aim-i-dpd by ch. r>:?7 - f L903. bner.d l'v ch. (>'> cf i!H)o. In effect May 27, 1905. THE RAILROAD LAW. 92. Consent of local authorities ; how procured. The application fur tho consent of the ! cal authorities shall he in writing and before acting therein such authorities shall give public notice thereof and of the time and place when it will firot be considered,, which notice shall be published daily in any city for at least fourteen days in two of its daily newspapers if there be two, if not, in one, to- be designated by the mayor, and in any village or town for at least fourteen days in a newspaper published therein, if any there shall be, and if none, then daily in two daily newspapers if there be two, ,if not, one published in the city nearest such village or town. tSuch consent must be upon the expressed condition that the provisions of this article pertinent thereto shall be complied with, and shall be filed in the office of the clerk of the county in which such railroad is located. Whenever the consent of the common council of a city is applied for, the fin-t consideration, of which notice i& hereby required, may be by committee of such common council. Any such notice, publication or consideration heretofore or hereafter given, made or had in substantial conformity with the requirements of this section, is and shall be sufficient notice, publication and consideration for all the purposes hereof notwithstanding any conflicting provision of any local or special act or charter. Am'd by chap. 434 of 1893. 93. Condition upon which consent shall be given; sale of franchise at public auction. The consent of the local authorities in. cities containing" twelve hundred and fifty thousand inhabitants or more, according to the last federal census or state enumeration, must contain the condition that the right, franchise and privilege of using any street, road, highway, avenue, park or public place shall be sold at public auction to the bidder who will agree to give the city the largest percentage per annum of the gross receipts of such corporation, with a bond or undertaking in such form and amount and with such con- ditions and sureties as may be required and approved by the comptrol'er or other chief fiscal officer of the city, for the fulfillment of such agree- ment and for the commencement and completion of its railroad within the time designated by law and for the performance of such additional conditions as the local authorities in their discretion may prescribe. Whenever such consent shall provide for the sale at public auction of the right to construct and operate a branch or extension of an existing railroad, such consent shall provide that but one fare shall be exacted f..r passage bver such branch or extension and over the line of road which shn 1 ! have applied therefor; and further, that if such right shall be purchased by any corporation other than the applicant, that the gross receipts from joint business shall be divided in the proportion that the Vn.'iih of such extension or branch so sold shall bear to the entire length of the road whether owned or leased which shah have applied therefor and of such br,-:nc!i or extension, and that if such right shall be purchased by the applicant, tho pore-en Tairo to be paid shall be cal- fu!:i!o;! on s'vh portion of its gross receipts as shall bear the same pro- portior to the whoV value thereof as the length of such extension or . branch sha 1 ! bear t;> the entire -ength of its road, whether owned or 41 THE RAILROAD LAW. leased. The bidder to whom such right, franchise and privilege may be sold must be a duly incorporated railroad corporation of this state, organized to construct, maintain and operate a street railroad in the city for which such consent may be given; but no such corporation shall be entitled to bid at such sale unless at least five days prior to the day fixed for such sale, or five days prior to the day to which such sale shall have been duly adjourned, the corporation shall have filed with the comptroller or other chief fiscal officer of the city, a bond in writing and under seal, with sufficient sureties, to be approved by such comptroller or officer conditioned that if such right, franchise and privilege shall be sold to such corporation, to pay to the city where sucn railroad is situated the sum of fifty thousand dollars as liquidated damages and not by way of penalty in the event of the failure of such bidder to fulfill the terms of sale, comply with the provisions of this article pertinent thereto, and complete and operate its railroad according to the plan or plans and upon the route or routes fixed for its construction within the time hereinafter designated for the construction and completion of its rail- road; and also conditioned to pay to the corporation first applying for the consent, if it shall not be the successful bidder, the necessary ex- penses incurred by such corporation prior to the sal* pursuant to the requirements and direction of the local authorities, within twenty days after such sale and upon the certificate of the comptroller or other officer conducting the same as to the sum or amount to be paid. Notice of the time and place and terms of sale, and of the route or routes to be sold, and of the conditions upon which the consent of the local authori- ties to the construction, operation and extension of such street rail- road will be given, must be published by such authorities for at least three successive weeks, and in any city having two or more daily news- papers, at least three times a week in two of such papers to be designated by the mayor, and in any city where two daily papers are not published, at least once a week in a newspaper published therein to be designated by the mayor. The comptroller or other chief fiscal officer of the city shall attend and conduct such sale and may adjourn the same, but not more than four weeks in all, unless further adjournments should, in his discretion, be necessary by reason of the pendency of legal proceed- ings, and shall cancel any bid if in excess of the gross receipts, leaving in force the highest bid not in excess, or if the bidder shall noi have furnished adequate security entitling such bidder to bid, or shall other- wise fail to comply with the terms and conditions of sale, and shall resell the consent and license in the same manner as hereinbefore pro- vided for the first sale. The bidder who may build and operate such railroad shall at all times keep accurate books of account of the Im-i- ness and earnings of such railroad, which books shall at all times be sub- ject to the inspection of the local authorities. In the event of the failure or refusal of the corporation operating or using such rai'road to pay the rental or percentages of gross earnings agreed upon, and after notice of not less tluin sixty days to pay the same, the local authorities interested therein may apply to any court having jurisdiction upon 42 THE RAILROAD LAW. at least twenty days notice to such corporation, and after it shall have had an opportunity to be heard in its defense, for judgment declaring the consent and right to operate and use such railroad forfeited and authorizing the sale again of the same in the manner hereinbefore pre- scribed, provided, however, that no such resale of any such consent and right heretofore granted shall be authorized except upon the condition that the same shall be subject to all liens and incumbrances existing on said railroads at the time such forfeiture may have been declared. All consents hereafter given by the local authorities, unless it be other- wise provided in such consent or in some rene.wal thereof may be for- feited at the expiration of two years thereafter, and every consent by the local authorities of any city of the first class or of any city, town or village now embraced within the corporate limits of any city of the first class heretofore given to or acquired or owned by any street surface rail- road corporation, since January first, eighteen hundred and ninety, is hereby ratified and confirmed, and shall be deemed to be in full force and effect, and shall continue until and including December thirty- first, nineteen hundred and three, when it may be forfeited unless prior thereto the required consent of property owners, or determinations by the appellate division of the supreme court in lieu thereof, shall have been first obtained. The board of sinking fund commissioners of any city shall have power to reduce, compromise or release any obligation or liability to the mayor, aldermen and commonalty of such city under the provisions of chapter six hundred and forty-two of the laws of eighteen hundred and eighty-six, or of this chapter whenever, in the opinion of such board, such release or compromise shall be just or equitable, or for the public interest, the reason for any such release or compromise to be stated in the recorded proceedings of such board. No lease by any company organized under section two of the railroad law and owning a right, privilege or franchise of using any street, ave- nue, highway or public place for railroad purposes, which has heretofore been sold under the provisions of this section, hereafter made to any street surface railroad company which is not subject to the payment of any percentage pursuant to this section, and which is not organized for the purpose of operating r railroad in a city of the first class, shall be valid until the leased company shall have filed in the office of the secretary of state and in the office of the clerk of the county where its certificate of incorporation is filed, its acceptance in writing and under its corporate seal of the provisions of this section as now amended : and upon such acceptance being filed, the total percentage amount thereafter to be paid annually under this section and under section ninety-five of this act, shall be at the rate of five per centum of the gross receipts derived from the operation of the roads of the lessor and lessee companies considered as one system. The lessee company, at the time of filing its acceptance aforesaid, shall also file in the same offices a bond to the people of the state, executed in duplic:iii- by it and a surety company authorized by law to act as surety on bonds and undertakings, in the penal sum of fifty thousand dollars, 42a THIS KAILUOAD LAW. and conditioned for the faithful payment annually of the total per- centage aforesaid, and such bond shall be deemed to be a full com- pliance with the condition for a bond or undertaking required by this section to be provided for in the conditions of the consent of tin- local authorities and shall supersede any such bond or undertaking there- tofore given. Whenever it shall be desired to unite two street surface railroad routes at some point not over one-half mile from such respec- tive lines or routes, and establish by the construction of such connection a new route for public travel, and the corporation or corporations owning or using "such railroads shall consent to operate such con- nection as a part of a continuous route for one fare, and it shall appear to the local authorities that such connection cannot be operated as an independent railroad without inconvenience to the public, but that it is to the public advantage that the same should be operated as a continuous line or route with existing railroads, or whenever for the purpose of connecting with any ferry or railroad depot, it snail be desired to construct an extension or branch not more than one-half mile in length, of any street surface railroad corporation, no sale of such franchise shall be made as provided in this section, but any con- sent of the local authorities for the construction and operation of such connection, extension or branch shall provide that the corporation or corporations operating such connection, extension or branch shall pay into the treasury of said city annually the percentage provided for extensions or branches in section ninety-five of this chapter, for the purposes, at the times, in the manner and upon the conditions set forth in such section. The provisions of this section as now amended shall apply to all cities of the first class, but nothing herein contained shall be construed as superseding, repealing or modifying any provision of the charter of any city, village or town, nor as modifying or affecting the terms of a certain contract bearing date January first, eighteen hun- dred and ninety-two, entered into by and between the city of Buffalo and the various street surface railroad corporations therein named iu such contract, except that the provisions of this act as amended, which continue and confirm the consents of local authorities shall apply to street surface railroads in the city of Buffalo, as well as in other cit- ies of the first-cXass. This section shall not modify or affect any con- tract heretofore entered into between a street surface railroad corpo- ration and any city of the third class, town or village regulating the payment of percentages or paving of streets, and any city of the third class, town or village, is hereby authorized to enter into any such form of contract with any street surface railroad corporation, and any such contract heretofore entered into is hereby ratified and confirmed. The local ai'thorities may, in their discretion, make their consent to depend upon any further conditions respecting other or further security, or deposit, suitable to secure the construction, completion and operation of the railroad within any time not exceeding the period prescribed in this article and respecting the character, quality or motive power of the rriaj 'to be completed and respecting the grouping of streets, avenues 42b THE RAILROAD LAW. and highways into one route, or into several routes, for the purpose of a single sale of the franchise, right or privilege for all the routes collect- ively, or of the separate sale for each route or street, as said local authorities may think expedient and respecting the payment of the percentage agreed to be paid at the sale upon all the lines operated by the successful bidder within the city and respecting any matter in- volved in or affecting 1 the computation of percentage payments and respecting the use of the railroads to be constructed under the consent by any other company and respecting the interchange of traffic and division of fares between the company operating such railroads and any other company, and respecting the application of any provision herein contained as to carriage of passengers for single fare and the division of gross receipts and the payment of percentages to the line leased or operated under contract by the applicant for an extension, and also respecting any other matter concerning which, in their judg- ment, further conditions would be for the public interest. Any and all consents, sales and proceedings heretofore granted, made or taken in substantial compliance with the provisions of this section, as now last amended, are hereby approved, ratified and confirmed, and any pur- chaser or successor to or transferee of the rights of the purchaser of any right or privilege heretofore sold substantially in accordance with the provisions of this section as now amended, is authorized to acquire the requisite consents of property owners, or, in lieu thereof, determina- tions by the appellate division of the supreme court, and to proceed with the construction of its road, at any time within three years here- after. Amended by ch. 494 of 1901. In effect April 23, 1901. 94. Proceedings if property owners do not consent. If the consent of property owners required by any provision of this article can not be obtained, the corporation failing to obtain such consents may apply to anv general term of the supreme court held in the department in which it is proposed to construct its road for the appointment of three commissioners to determine whether such railroad ought to be constructed and operated. Notice of such application must, at least ten days prior thereto, be served, personally, upon each nou consenting property owner by delivering the same to the person to whom such property is assessed upon such assessment-roll or by duly mailing 1 the same, prop- erly folded and directed, to such property owner at his post-office address with the postage prepaid thereon. If the person upon whom service is to be made is unknown, or his residence and post-office address are unknown and can not by reasonable diligence be ascertained, service of such notice may be made by pub- lishing the same in such newspaper of the county as the court may direct, at least once a week for two successive weeks. Upon due proof of service of such notice the court to which the application is made shall appoint three disinterested persons, who shall act as commissioners, and who shall, within ten days after their ap- pointment, cause public notice to be given of their first meeting in the manner directed by the court, and may adjourn from time to time, until all their business is completed. Vacancies may be rilled by the court after such notice to parties interested as it may deem proper to be given; and the evidence taken before as well as after the happening of the vacancy shall be deemed to be properly before such commissioners. After a public hearing of all parties interested, the com- missioners shall determine whether such railroad ought to be constructed and operated, and shall make a report thereon, together with the evidence taken, to the gene-al term within sixty days after appointment, unless the court, or a judge thereof, for good cause shown, shall extend such time; and their determina- tion that such road ought to be constructed and operated, confirmed by such court, 43 RAILROAD LATT. shall be taken in lieu of the consent of the property owners hereinbefore required The commissioners shall each receive ten dollars for each day spent in the per formance of their duties and their necessary expenses and disbursements, which shall be iiis receipts, not exceeding three per cent, into the treasury of the city or village as they may deem proper. In case of extension the amount to to be paid shall be ascertained in the manner heretofore provided. The corporation failing to pay such percentage of its gross earnings, shall, after November first, pay in addition thereto five per cent a month on such percentage until paid. The president and treasurer of any corporation required by the provisions of this article to make a pay- ment annually upon its gross receipts shall, on or before November first in each year, make a verified report to the comptroller or chief fiscal officer of the city of the gross amount of its receipts for the year ending September thirtieth, next preceding, and the books of such corporation shall be open to inspection and examination by such comptroller or officer, or his duly appointed agent, for the purpose of ascertaining the correctness of its report as to its gross receipts. The corporate rights, privileges and franchises acquired under this article or such chapter by any corporation, which shall fail to comply with all the provisions of this section, shall be forfeited to the people of the 44 EAILROAD LAW. state, and upon judgment of forfeiture rendered in an action brought in the name of the people by the Attorney-General, shall cease and determine. L. 1884, ch. 252, 8. L. 1889, ch. 564. 96. Extension of route over rivers ; terminus In other counties ; when property owners -withhold consent ; supreme court may ap- point commissioners. Any street railroad in operation in this state, which shall bv a two thirds vote of its directors, decide to extend ihe route of its road, so as to cross a river over and by any bridge now or hereafter constructed under the provisions of any law of this state, may so extend their route over and across such bridge upon such terms us may be mutually agreed upon between it and such bridge company, and may locate the terminus of their roa'l in the county adjoining the cnc in \\lridi their road is now loc 'ted and in operation, upon first obtaining the consent of such bridge company or its lessees, and the consent of the owners (if one-half in value of the property bounded on, and the consent also of the local authorities having the control of that portion of a street or highway upon which it is proposed to construct or operate such railroad, or in case the consent of such property owners cannot be obtained the appellate division of the supreme court in the district in which it is proposed to be constructed may, upon application, appoint three commissioners, who shall determine after a hearing of all parties interested, whether such railroad- ought to be constructed, or operated, and their determination, confirmed by the court, may be taken in lieu of the consent of the property owners. Whenever a terminus of any public viaduct, bridge or bridges, or public viaduct connected with any bridge or bridges, hereto- fore or hereafter constructed in and owned and maintained by any city of the first ("Irss, or town adjoining the same, is or shall 1 e located at or adjacent to or within onc-hnlf mile of the route of any existing street surface railroad, the cor- poration own in j cr operating such railroad may, irrespective of any provisions otherwise applicable thereto eonta'ned in any general or local act, upon obtaining the consent of the lcal authorities and property owners as above provided, and upon complying with the provisions of the ra'lroad law appli able thereto, extend its road or route and construct and operate iis railroad, lo, upon ard across such viaduct, bridge or bridges and approaches thereto for the purpose of connecting -with another railroad route not more than one-half mile distant from such bridge or viaduct so as to nffor-1 a continuous ride for one fare, subject to the provisions of the railroad law, or for the purpose of reaching the depot, station or terminus of another railroad not more than one half mile distant from such bridge or viaduct. This section shall not apply to any bridge over the Hudson or East rivers in the counties of New York and Kings, nor to any bridge or viaduct constructed under the provisions of any so-called grade crossing law. Amended by ch. 419 of 1901. In effect April 18, 1901. 97. Use of tracks of other roads. Any railroad corporation in this state, whose cars are run and operated by horses or other motive power, authorized by this article, upon the surface of the street, excepting in the city and county of New York, may, for the purpose of enabling it to connect with and run and operate its cars between its tracks and a depot or car-house owned by it, run upon, intersect, and use, for not exceeding five hundred feet, the tracks of any other railroad corporation, the cars of which are run and operated in like manner, with the necessary connections and switches for the proper working and accommodation of the cars upon such tracks, and in connection with such depot or car-house, upon paying therefor such compensation as it may agree upon with the corporation owning the tracks to be so run upon, intersected, and used; and in case such cor- porations can not agree upon the amount of such compensation, the 45 RAILROAD LAW. same shall be ascertained and determined in the manner prescribed in the condemnation law. 98. Repair of streets ; rate of speed ; removal of ice and snow. Every street surface railroad corporation so long as it sha'l continue to use any of its tracks in any street, avenue or public place in any city or village shall have and keep in permanent repair thut portion of such street, avenue or public place between its tracks, the rails of its tracks, and two feet in width outside of its tracks, under the supervision of the proper local authorities, and whenever required by them to do so, and in such manner as they may prescribe. In case of the neglect of any corporation to make pavements or repairs after the expiration of thirty days notice to do so, the local authorities may make the same at the expense of such corporation, and such au- thorities may make such reasonable regulations and ordinances as to the rate of speed, mode of use of tracks, and removal of ice and snow, as the interests or convenience of the public may require. A corpora- tion whose agents or servants willfully or negligently violate such an ordinance or regulation, shall be liable to such city or village for a penalty not exceeding five hundred dollars to be specified in such or- dinance or regulation. 99. Within what time road to be built. In case any such corpora- tion shall not commence the construction of its road, or of any ex- tension or branch thereof, within one year after the consent of the local authorities and property owners or the determination of the appellate division of the supreme court as herein required, shall have been given or renewed, and shall not complete the same within three years after such consents, or determination shall have been obtained, its rights, privileges and franchises in respect of such railroad or extension or branch, as the case may be, may be forfeited. If the performance of any act required by the railroad law or any prior acts within the times therein prescribed, ie hindered, delayed or prevented by legal proceedings in any court, such court may also extend such time for such period as the court shall deem proper, or if the performance of any act required by said article within the times therein prescribed is hindered, delayed or prevented by works of public improvement, or from any other or different cause, not within the control of the corporation upon which such requirement is imposed, the time for the performance of such act is hereby and shall be deemed to be extended for the period covered by such hindrance, delay or pre- vention. The time for compliance with any requirement in this or any former act, by a street surface railroad corporation incorporated for the purpose of constructing a street surface railroad and which has prior to the passage of this act obtained or shall prior to June 30th, 1903 obtain uch consents or determination is hereby extended until June 30th, 1904. Amended by chap. 434 of 1893. Amended by chap. 209, of 1902. In effect March 25, 1902. 100. Motive power. Any street surface railroad may operate any portion of its road by animal or horse power, or by cable, electricity, or any power other than locomotive steam power, which said locomotive steam power is primarily generated by the locomotive propelling the cars, and in the use of which either escaping steam or smoke is visible, which may be approved by the state board of railroad commissioners, and consented to by the owners of one-half of the property bounded on that portion of the railroad, with re-peet to which a change of motive power is proposed; and if the consent of such property owners cannot be obtained, the determination of three disinterested commissioners, appointed by the appellate division of the supreme court of the depart- 46 THE RAILROAD LAW. merit in which such railroad is located, in favor of such motive powei, confirmed by the court, shall be taken in lieu of the consent of the property owners. The consent of the property owners shall be obtained and the proceedings for the appointment and the determination of the commissioners and the confirmation of their report shall be conducted in the manner prescribed in sections ninety-one and ninety-four of this article, so far as the same can properly be made applicable thereto. Any railroad corporation making a change in its motive power under this section, may make any changes in the construction of its road or roadbed or other property rendered necessary by the change in its motive power. Where a street surface railroad in the counties of Herkimer and Hamilton is located wholly outside the limits of an incorporated city or village, such railroad may, with the approval of the state board of railroad commissioners be operated by locomotive steam power, provided that such steam power is generated by oil from and including April fifteenth to and including November thirtieth, and by either oil or coal from and including 1 December first to and including April fourteenth. Amended by chap. 553 of 1901. In effect April 25, 1901. 101. Rate of fare. No corporation constructing and operating a railroad under the provisions of this article, or of chapter two hundred and fifty-two ol the laws of eighteen hundred and eighty-four, shall charge any passenger more than five cents for one continuous ride from any point on its road, or on -any roau, line or branch operated by it, or under its control, to any other point thereof, or any connecting branch thereof, within the limits of any incorporated city or vil- lage. Not more than one fare shall be charged within the limits of any such city or village, for passage over the main line of road and any branch or extension thereof if the right to construct such branch or extension shall have been acquired' under the provisions of such chapter or of this article; except that in any city of the third class, or incorporated village, it shall be lawful for such corpora; ion to charge and collect as a maximum rate of fare for each passenger, ten cents, whore such passenger is carried in a car which overcomes an elevation of at least four hundred and fifty feet within a distance of one and a half miles. This section shall not apply to any part of any road constructed prior to May six, eighteen hundred and eighty-four, and then in operation, unless the corporation owning the same shall have acquired the right to extend such road, or to construct branches thereof under such chapter, or shall acquire such right under the pro- visions of this article, in which event its rate of fare shall not exceed its author. ized rate prior to such extension. The legislature expressly reserves the right to regulate and reduce the rate of fare on any railroad constructed and operated wholly or in part under such chapter or under the provision* of this article. Am'd by chap. 688 of 1897. 102. Construction of road in street -where other road is built. No street surface railroad corporation shall construct, * x- tend or operate its road or tracks in that portion of any street, avenue, road or highway, in which a street surface railroad is or shall be law- fully constructed, except for necessary crossings, or, in cities, v)llages and towns of less than one million two hundred and fifty thousand in- habitants over any bridges, without first obtaining the consent of the corporation owning and maintaining the same, except that any street surface railroad company may use the tracks of another street surface 4" UAIL..UAD LAW. railroad company for a distance not exceeding one thousand feet, and if in a city having a population of less than thirty-five thousand in- habitants, except Long Island City, for a distance not exceeding fifteen hundred feet, ir-d in cities, villages and towns of le.ss than one million two hundred and fifty thousand inhabitants, shall have the right t> lay its tracks upon, and run over and use any bridges used wholly or in pnrt as a foot-bridge, whenever the court upon an application for commissioners shall be satisfied that such use is actually necessary to connect main portions of a line to be constructed or operated as . n independent railroad, or to connect said railroad with a ferry, or with another existing railroad, and that the public convenience requires the same, in which event the right to use shall only be given for a com- pensation to an extent and in a manner to be ascertained and deter- mined by commissioners to be appointed by the courts as is provided in the condemnation law, or by the board of railroad commissioners in cases where the corporations interested shall unite in a request lor such board to act. Such commissioners in determining the compen- sation to be paid for the use by one corporation of the tracks of another fhall consider and allow for the use of the tracks for all injury and damage to the corporation whose tracks may be so usod. Any street surface railroad corporation may, in pursuance of a unanimous vote of the stockholders voting at a special meeting called for that purpose by notice in writing, signed by a majority of the directors of such cor- poration, stating the time, place and object of the meeting, and serv- ing upon each stockholder appearing as such upon the books of the corporation, personally or by mail, at his last known post-office address, at least sixty days prior to such meeting, guarantee the bonds of any other street surface railroad corporation whose road is fully or partly in the same city or town or adjacent cities or towns. Am'd by chap. 693 of 1894. Took effect May 12, 1894. 103. Abandonment of part of route. Any street surface rail- road corporation may declare any portion of its route which it may deem no longer necessary for the successful operation of its road and convenience of the public to be relinquished or abandoned. Such declaration of abandonment must be adopted by the board of direct- ors of the corporation under its seal which shall be submitted to the stockholders thereof at a meeting called and conducted in the same manner as required by law for meetings of stockholders for the ap- proval of .leases by railroad corporations for the use of their respect- ive roads. If the stockholders shall, at such meeting, ratify and adopt such declaration of abandonment, the secretary of the company shall so certify under the seal of the corporation, upon such declara- tion. Such declaration shall then be submitted to the board of railroad commissioners for its approval, and if approved by such board, such approval shall be indorsed therein or annexed thereto and the declara 48 RAILROAD LAW tion so certified and indorsed shall be filed and recorded in the office of the secretary of state, and from the time of such filing, such por- tion of the route designated in the declaration shall be deemed to be abandoned. Am'd by chap. 478 of 1900. In effect April 17, 1900. Former section 103 has been omitted because embraced in section 78. The new section embodies that part of chapter 532 of 1889 which relates to the abandon- ment of route. 104. Contracting corporations to carry for one fare ; penalty. Every such corporation entering into such contract shall cany or permit any other party thereto to carry between any two points on the railroads or portions thereof embraced in such coiitrac( 'any passenger desiring to make one continuous trip between such points for one single fare, not higher than the fare lawfully charge- able by either of such corporations for an adult passenger. Every such corporation shall upon demand, and without extra charge, give tc each passenger paying one single fare a transfer, entitling such pas- senger to one continuous trip to any point or portion of any railroad embraced in such contract, to the end that the public convenience may be promoted by the operation of the railroads embraced in such contract substantially as a single railroad with a single rate of fare. For every refusal to comply with the requirements of this section the corporation so refusing shall forfeit fifty dollars to the aggrieved party. The provisions of this section shall only apply to railroads wholly within the limits of any one incorporated city or village. Former section 105 ; 104 having been omitted because embraced in section 78. 105. Effect of dissolution of charter as to consents. When- ever any street surface railroad corporation shall have been dissolved or annulled, or its charter repealed by an act of the legislature, the consent of owners of property bounded on, and the consent of the local authorities having the control of that portion of a street or highway upon which the railroad of such corporation shall have been theretofore constructed and operated, and the order of the general term confirm- ing the report of any commissioner that such railroad ought to be con- structed or operated, shall not, nor shall either thereof, be deemed to be in any way impaired, revoked, terminated or otherwise affected by such act of dissolution, annulment or repeal, but the same and each thereof shall continue in full force, efficacy and being. The right to the further enjoyment and to the use thereof, subsequent to such act of dissolution, annulment or repeal, and of all the powers, privil^es and benefits therein or thereby created, shall be sold at public auction by the local authorities within whose jurisdiction such railroads shall 49 RAILROAD LAW. ' l.o, i.i the >-aine manner as is piovidcd in section ninety-three of this anicle. When such sale sli'all have been so made, the purcha-i-r thereat shall have the right to the further enjoyment and use of Midi consents and orders, and of each thereof, and of all the poweis, privileges and benefits therein or thereby created, in like manner as if such purchaser had been originally named in such consents, repoits jiiid (.rder; ; if such purchaser shall be otherwise authorized by law to construct, maintain a d operate a sheet surface railroad within the municipality wL.hin which such railroad shall be. Former t-ectiou 1U6. $ 106. Corporate rights saved in case of failure to complete road ; right to operate branches ; conditions ; former consents ratified; limitations. TLs corporate existence of and powers ol every street surface railroad corporation, which has completed a rail- road upon the greater portion of the route designated in its certificate of incorporation, within ten years from the date of filingsuch certificate in the office of the Secretary of State, and which has operated such completed portion of its railroad continuously for a period of five y i ;u> last past, and is now operating the same, shall continue with like force and effect, as though it had in all respects complied with the provisions of law with reference to the time when it should have fully completed its road. Every such corporation shall have the right to operate any extensions and branches of its railroad, now constructed and operated by it, which have been so constructed and operated by it, for a period of ten years last past, with like force and effect, as though the route of such extensions and branches were designated in its certificate of incorporation. But every such street railroad corporation is author- i^ed to operate such railroad and any extensions or branches then -of, upon condition that it is heretofore, or shall hereafter, obtain the con* sent of the local authorities having the control of that portion of the streets, avenues or highways included in such railroad, or any extension or brandies thereof, to the construction and operation of the same, and also upon the condi tion that it has heretofore or shall hereafter first obtain the consent of the owm-rs of one half in value of the property bounded on the portion of the streets, avenues or highways included in the route of such railroad, or any extension or bra; thereof, to the construction and opera 1 ion of the same, or in case the con^ei t of such property owners cannot be obtained, the appellate division of the supu-me court of the department in which such railroad or any extension or brajr-h thereof is located, may, upon application, appoint three commissioners -who shall deter- mine, after a hearing of sill the parties interested, whether such railroad ought to be constructed or operated, and their determination, confirmed by the court, may be taken in lieu of the consent of the property owners. If any street surface rail- road corporation, shall have made and filed a statement or statements of pro extensions or branches embracing a line from the boundary of a city or village to the boundary of another city or village generally parallel with the u.ute spe< iiie ! in its certificate of incorporation and generally distant not more than ore haH mile therefrom, nnd shall have made and filed an agreement of consolidation with some other street surface railroad corporation forned to build a street railroad up- on a route continuous or connecting w'th one or more of the routes described in such statement or statements of proposed extensions or branches, and thereafter there shall have oeen constructed and operated for a period of four years a street surface railroad from suoh city or village to such other city or village upon a line embraced in any such proposed extensions or branches, such consolidated corpora- 50 RAILROAD LAW. tion may relinquish and abandon any unconstructed route or unconstructed portions of route specified in the certificate of incorporation or in any statements of proposed extensions or branches of such first mentioned corpora- tion by filing in the office of the secretary of state a copy of a resolution of the board of directors of such consolidated corporation certified by its presi- dent and secretary, declaring such unconstructed route or unoonstructed por- tions of route relinquished and abandoned, and thereupon the corporate rights, powers and franchises of such consolidated corporation shall be and continue the same as though the certificate of incorporation of such constituent cor- poration had specified the constructed and not the unconstructed portions of such route and proposed extensions and branches. All consents heretofore given, or grants made by local authorities having the control of the portion of any street, avenue or highway included in the route of such railroad, or any extensions or branches thereof, to any such street surface railroad cor- poration, are hereby ratified and confirmed and declared valid. This section shall be applicable to any corporations whose lines are wholly within any towns, cities or villages having less than twenty thousand inhabitants. This section shall not apply to or affect any railroad corporation in the city of New York; nor any special grant made to or authority conferred upon any street surface railroad corporation by any law of this state; nor any pending litigation; nor shall it impair existing rights, privileges or franchises of any street surface railroad corporation. Amended by chap. 198 of 1900. In effect March 23, 1900. 107. When sand may be used on tracks. The owner or operator of any street surface railroad in cities of this state, may place upon the space between the rails, and upon the rails of such road sand in sufficient quantities to prevent the horses traveling thereon from slipping, and to enable cars operated by mechanical, or electrical appliances to be safely and properly operated. The owner or operator of any street surface railroad in cities of this state may use salt in necessary quantities, upon the rails of all the switches, curves, turnouts and crossovers, between the first day of November of each year and the first day of May following, for the removal of snow and ice therefrom and to prevent the same from freezing. The quantity of salt to be used and the manner of applying salt to the 'rails, to be under the direc- tion of the city officials having charge of the streets of said cities. Am'd bv ch. 491 of 1899. 108. Road not to be constructed upon ground occupied by public buildings or in public parks. No street surface railroad shall be constructed or extended upon ground occupied by buildings belonging to any town, city, county or to the state, or to the United States, or in public parks, except in tunnels to be approved by the local authorities having control of such parks. Provided however that the commissioners of the state reservation at Niagara, by and with tne consent of the commissioners of the land office, may construct without expense to the state street railroad tracks upon and along that part of the riverway, so called, between Falls and Niagara streets in the city of Niagara Falls, and in their discretion may grant revokable licenses to street surface railroad companies to use such tracks upon such terms as said commissioners may prescribe. Am'd by ch. 710 of 1899. 109. Center-bearing rails prohibited. No street surface railroad corpora- tion shall hereafter lay down in the streets of any incorporated city or village of this state what are known as "center-bearing" rails; but in all cases, whether in laying new track or in replacing old rails, shall lay down "grooved " or some other kind of rail not " center-bearing," approved by the local author- ities. Such grooved or other rail shall be of such shape and so laid as to permit the paving stones to come in close contact with the projection which serves to guide the flange to the car wheel. \Ylir other- wise; and any such contract may provide for the payment of an annual amount to be ascertained as in such contract provided in lieu of any or all payments of any of the classes hereinbefore mentioned, other than taxes. Any such contract which shall b2 with a corporation operating lines of railroad by lease may provide for an annual payment, to be ascertained as in such contract provided, which shall be in lieu of any or all of the payments of any or all of said classes, other than taxes upon real and personal property and capital stock, which w r ould other- wise be payable in respect of the leased lines so long as the lease or leases thereof shall continue. The annual payments provided for in any contract made under the authority of this act shall, so long as such contract is in force, supersede the payments which would otherwise be payable by the corporation or cor- porations making such contract and in lieu of which the annual payments provided for in such contract are substituted. Any contract made hereunder may, with the approval of the muni- cipal authorities by whom the contract was made or their suc- cessors in office, be modified from time to time by the parties thereto for the purpose of meeting changed conditions. Xo con- tract shall be made or modified hereunder without the written consent and approval of the mayor and of the comptroller or other chief financial officer of the city. Added by ch. 651 of 1905. In effect May 27, 1905. 112. Protection of employees in the counties of Kings and Queens. -Every corporation operating a street surface railroad in the counties of Kings or Queens, shall cause the front and rear platforms of every passenger car propelled by electricity, cable or compressed air, operated on any division of such rail- road during the months of December, January, February and March, except cars attached to the rear of other cars, to be enclosed from the fronts of the platforms to the fronts of the hoods so as to afford protection to any person stationed by such corporation on such platforms to perform duties connected with the operation of such cars. Every corporation or person using and operating a car in violation of such section shall be liable to a penalty of twenty-five dollars per day for each car used and operated, to be collected in an action brought by the attorney-general and to be paid to the treasurer of the city of New York, or in a suit by the district attorney of the counties of Kings or Queens to be paid into the treasury of the city of New York. One-third of the cars operated by any corporation in either of the above named counties shall be equipped with Blc RAILROAD LAW. the enclosures provided for in section one of this act on or before December first, nineteen hundred and five, one-third thereof after December first, nineteen hundred and five, and before Decem- ber first, nineteen hundred and six, and the remaining one-third thereof after December first, nineteen hundred and six, and before December first, nineteen hundred and seven. 2. All acts or parts of acts inconsistent with this act are hereby repealed. Added by ch. 453 of 1905. In effect May 16, 1905. ARTICLE V. OTHER RAILROADS IN CITIES AND COUNTIES. Section 120. Application for railway; commissioners. 121. Oath and bond of commissioners. 122. First meet-ing of commissioners. 123. Determination of necessity of railroad and route. 124. Adoption of plans and terms upon which road shall be built. 125. Appraisal of damages and deposit of money as security. 126. Sftall prepare certificate of incorporation; proviso as to forfeiture. 127. Organization. 128. Commissioners to deliver certificate; affidavit of directors. 129. Powers. 130. Crossing of horse railroad track. 131. Where route coincides with another route. 132. Ccmissioners; to transfer plans, etc. 133. Commissioners to file report; confirmation tnereof. 134. Pay of commissioners. 135. Quorum; term of office; removal; vacancies in board of com- missioners. 136. Abandonment or change of route; new commissioners; their power and proceedings. 137. Increased deposit; when and how required. 138. Trains to come to full stop, etc. 139. Cates. 140. Penalty for violation of this article. 141. Sections to Ic printed and posted. 142. Extension of time. 120. Application for railway; commissioners. Upon the appli- cation of at lease fifty reputable householders and tax payers of any county or city, verified upon oath before a justice of the supreme court, that there is need in said county or city of a ste;un mil way in the streets, avenues and public places thereof fur the transportation of passengers, mails or freight, the boar, I <>f supervises of such county may, within thirty days thereafter by peso si > i. approve of the application and authorise its piv to t'.:: 1 supreme court, and if tin- railway is to L-e buiit v.'lolly \vi'.\in the limits of a city, upon the RAILROAD LAW. application of a like number of householders and tax payers of the city to the mayor thereof, such mayor may, within thirty days there- after, indorse upon the application his approval and direction that it may be presented to the supreme court, and if the railway is to be built, partly within the limits of a city and partly without, such appli- cation shall be approved, both by the mayor of the city and the board of supervisors of the county, and its presentation to the t--iipre;ne court authorized by them, ami upon The presentation of such application so approved and authorized to a special term of the supreme court, held in the district where such railway is to be built, or some part thereof, the court may appoint live commissioners, residents of the city it' the railway is to be built wholly within the city, and of the county, if it is to be built wholly or partly outside of the limits of a city, to determine the necessity of such railroad, the route thereof, the time within which and the conditions upon which it shall be constructed, the damages to the property owners along the line thereof arid all the matters lawfully submitted to them, and discharge the duties imposed upon them by law. 121. Oath and bond of commissioners. "Wiihin ten days after his appointment and before entering upon the discharge of any of the duties of his office, each commissioner shall take and subscribe the constitutional oath of office, which shall be filed in the office of the clerk of the county and shall execute a bond to the people of the state in the penal sum of twenty-five thousand dollars, with two or more sureties, to be approved by a justice of the supreme court of the department in which the railway is to be built arid conditioned for the faithful performance of the duties of the office, which bond shall be filed in the office of the clerk of the county. 122. First meeting of commissioners. Within fifteen days after their appointment, the commissioners shall meet in some con- venient place in the county or city and organize themselves as a board with appropriate officers. 123. Determination of necessity of railroad and route. The commissioners shall, within thirty days after such organization, de- termine upon the necessity of such steam railroad, and if they find it to be necessary, they shall, within sixty days after such organization, fix and determine the route therefor, and shall have the exclusive power to locate such route, over, under, through or across shv. Mie- places or lands in such county or city, and to provide for the connectioi or junction with any other railway or bridge, if the consent of the owners of one-half iti value of the property bounded mi and the con- sent of the local authorities having control of that portion of a street or highway, upon which it is proposed to construct or operate such rail- 5:3 RAILROAD LAW. wa.y have been first obtained. If the consent of such property "owners can not be obtained, the determination of three commissioners ap- pointed by the general term of the supreme court of the department where the railroad is to be constructed, made after due hearing of all parties interested, and confirmed by the court, that such railway ought to be constructed and operated, may be taken in lieu of the consent of such property owners. No such railway shall be located in or upon such portion of any street, avenue, place or lands in such county as are now occupied by an elevated or underground railway or in which such a railway has already been authorized by law to be so located and constructed, or which are contained in public parks, or occupied by buildings belonging to the county or the state or United States, or in or upon the following streets, avenues and public places, viz.: Broad- way, Fifth avenue, Fourth avenue above Forty-second street, in the city of New York ; Debevoise place, Irving place, Lefferts place, those portions of Grand, Classon and Franklin avenues and Dowling street lying between the southerly line of Lexington avenue and the northerly line of Atlantic avenue, that portion of Classon avenue lying between the northerly line of Lexington avenue and the southerly line of Park avenue, and that portion of Washington avenue lying between Park and Atlantic avenues in the city of Brooklyn; and that portion of the city of Buffalo lying between Michigan and Main streets, but such railway may be located and constructed across such excepted streets, avenues and places at their intersection only with other streets, avenues and places. Amended 1892. 124. Adoption of plans, and terms upon which road shall be built. The commissioners by such public notice, and under such conditions, and with such inducements as they may prescribe, shall in- vite a submission of plans for the construction and operation of su< -h railway, and shall meet at a time and place in such notice named, not more than ninety days after their organization, and decide upon the plans for the construction thereof, with the necessary supports, turnouts, switches, sidings, connections, landing-places, stations, buildings, platforms, stairways, elevators, telegraph arid signal devices, or other requisite appliances, upon the route or location determined upon by thorn. They shall, upon notice to the local authorities, and after hear- ing all parties interested, fix and determine what compensation, if any, in a gross sum, or in a certain percentage of receipts, shall annually !>< jiaid to the local authorities by the corporation formed for the pur- pose of constriK-tinir, maintaining and operating surli raihvay for public use in the conveyance of persons and property, for the use and occupation by the corporation of the streets, avenues and highways in 54 RAILROAD LAW. and upon which its railway is to be constructed, and the time when such railway, or a portion thereof, shall be constructed and ready for operation, and The maximum rates !<> In- paid for transportation and conveyance iheieon, and the hours during which special cars, or trains shall be run at reduced rates of fare ; and the amount of tin; capital stork of su h corporation, and the number of shares into which it shall be divided, and the percentage thereof to be paid in cash on MibscriK- ing for such shares. The commissioners may select two or more routes, upon one of which such railway may be constructed and operated; and the local authori- ties may consent to the construction and operation of such railway upon one or more of such routes, or parts thereof; and the commis- sioners shall have power to change and readopt routes and plan- for the construction and operation of such railway, after they have been submitted to the local authorities, in cases where such authorities may recommend such changes, or may not be willing to consent to the con- struction or operation of the railway, upon the routes and plans adopted, unless such changes are made therein. Amended 1892. 125. Appraisal of damages and deposit of money as se- curity. The commissioners shall, within one hundred and ten days after their organization, ascertain and determine the aggregate pecu- niary damage arising from the diminution in the value of the property bounded on that portion of such street or streets, highway or highways, upon which it is proposed to construct and operate such railway to be caused by the construction and operation thereof. For that purpose they shall view the several parcels of real property so bounded, and shall appraise separately the pecuniary damages arising from such diminution in value of each parcel thereof, and for the purposes of such appraisal they shall give notice of the time and place, when and where they will meet to hear the owners, or persons interested in such real property, which notice shall be published for at least ten days consecutively in at least two newspapers in the county where such rail- way is to be constructed, and shall take such material testimony upon the probable diminution in value of any or all such parcels to be so caused as may be offered by or in behalf of any person or party interested therein, and the aggregate sum of the amounts so apprai~<-d and determined by them shall be the aggregate pecuniary damage required to be ascertained and determined as above provided. Xo corporation which shall hereafter be organized under this article shall enter upon any street, highway or lane therein, until it shall first have deposited with some trust company, to be designated by the mayor of the city within which it is proposed to construct the railway or any 55 RAILROAD LAW. part thereof, and by the board of supervisors, when the road does not lie wholly within a city, a sura of money equal to the amount so ascer- tained and determined by the commissioners to be the aggregate pecuniary damage to such property within the city, or within the county outside of any city, or shall have secured the payment of such amount by depositing with such trust company negotiable securities, equivalent at their par and actual value to such aggregate amount, and approved by the mayor of the city in which such road is wholly or in part located, and by the county treasurer of the county if the road is located wholly or in part outside of the limits of such city. The court may accept in lieu of the deposit of money or securities herein required the bond of the corporation, with two or more sureties, to be approved by the court, to the effect that the corporation before constructing or operating its railway in front of any premises, shall pay to the owner of the real property all the damages sustained, or which will be sus- tained by him, as fixed and determined by such commissioners, and the costs allowed, if any. 8uch bond shall be in a sum double the amount of such damages, and the sureties shall justify in the aggregate to an amount equal to the amount of such bond. Such corporation shall also, at the same time, deposit with such trust company or with the county treasurer, as the commissioners may direct, the sum of five thousand dollars in cash, for the payment of the expense of apportioning and distributing such fund. Unless such moneys or securities shall be deposited by such corporation within one year after it shall have obtained the consent of the local authorities, and of the property owners, or the confirmation by the general term of the supreme court, of the determination of three commissioners in lieu thereof, and in the case of a corporation heretofore organized within one year after it shall have obtained the confirmation by the general term of the supreme court of the report of three commissioners in lieu of the consent of property owners, or within one year after the commissioners appointed to ascertain and determine the aggregate pecuniary damages as provided in this article, shall have made their report, then such corporation shall be deemed not to have accepted the franchises granted. Where the commissioners shall fix and determine different periods of time within which different sections of such railway shall be constructed and ready for operation, they shall ascertain, determine, and report separately the aggregate pecuniary damage to property bounded upon that portion of such street or streets upon which each of such sections is located. Upon the deposit by the corporation as above provided of moneys or securities equivalent to th" nirgregat.e, pecuniary damage to be sustained by any one of such sections, or of any bond given in lieu thereof, it shall immediately be 56 RAILROAD LAW. vested with the right and privilege to construct its railway through such section. Amended 1892. 126. Shall prepare certificate of incorporation ; proviso as to forfeiture. The commissioners shall prepare an appropriate cer- tificate of incorporation for the corporation in the last section IIKMI- tioned in which shall be set forth and embodied, as component parts thereof, the several conditions, requirements and particulars by such commissioners determined pursuant to the provisions of this article, and which shall also provide for the release and forfeiture to the super- visors of the county, or if the road is to be constructed wholly or partly within a city, to such city, of all rights and franchises acquired by such corporation in case such railway or railways shall not be com- pleted within the time and upon the conditions therein provided ; and the commissioners shall thereupon and within one hundred and twenty days after their organization cause a suitable book of subscription to the capital stock of such corporation, to be opened pursuant to due public notice at a banking office in such county or city. A failure by any corporation heretofore or hereafter organized under this article to complete its railway within the time limited in and by its certificate of incorporation shall only work a forfeiture of the franchises of such corporation with respect to that portion of its route which such corpo- ration shall have failed to complete, and shall not affect the rights and franchises of such corporation to construct and operate such part of its railway which it shall have completed within the term prescribed by its certificate of incorporation, or as to which the time for completion shall not have expired, notwithstanding anything to the contrary in its certificate of incorporation. 127. Organization. Whenever the whole capital stock of such corporation or an amount of such capital stock proportioned to the part, of such railway directed by the commissioners to be constructed, shall have been subscribed by not less than fifteen persons, and the fixed percentage of such subscriptions shall have been paid, in cash, the commissioners shall, by written or printed notice of ten days, served personally or by mail, call a meeting of such subscribers for organization, and appoint the inspectors of election to serve thereat. At such meeting, or at any subsequent one to which the same may be adjourned, a majority in number and amount of such subscribers may elect persons, of a number to be theretofore determined by the com- missioners not less than nine, who shall be directors for one year of the corporation formed for the purposes of constructing and operating such railway. 57 RAILROAD LAW. 128. Commissioners to deliver certificate ; affidavit of di- rectors. Within ten days after The election of such directors the commissioners shall deliver to them a certificate in duplicate, verified by the oath of three commissioners, before a justice of the supreme court, setting forth the certificate of incorporation and the organiza- tion of the corporation for the purposes therein mentioned, and within live days after the reception by them of such certificates, three of the directors so elected shall make affidavit i:i duplicate that the full amount of sTock has been subscribed in good faith to construct, main- tain and operate the railway or railways in such certificate of incorpo- ration mentioned, and such directors shall file such affidavits and cer- tificate in the office of the Secretary of State, and a duplicate of the same in the office of the clerk of the county wherein such railway shall be located ; and thereupon the persons who have so subscribed such certificate of incorporation and all persons who shall become stock- holders in such corporation shall be a corporation by the name specified in such certificate, and be subject to the duties, liabilities and restric- tions of such corporations. 129. Powers. Every such corporation shall have power, in addition to the powers conferred by the general and stock corporation laws and by subdivisions two, five and seven of section eight of this chapter : 1. To take and convey persons and property on their railroad by the power or force of steam or by any motor other than animal power, and to receive compensation therefor. 2. To enter upon and underneath the several streets, avenues and public places and lands designated by the commissioners, and enter into and upon the soil of the same, to construct, maintain, operate and use in accordance with- the plan adopted by the commissioners, a rail- way upon the route or routes and to the points decided upon and to secure the necessary foundations and erect the columns, piers and other structures which may be required to secure safety and stability in the construction and maintenance of the railways constructed upon such plan and for operating the same ; and to make such excavations and openings along the route through which such railway shall be con- structed as shall be necessary from time to time. In all cases the sur- face of the streets around such foundations, piers and columns shall be restored to the condition in which they were before such excava- tions were made, as near as may bi, and any interference with or change in the water mains, or in the sewers or lamp posts, except such changes as may be made with the concurrence of the proper depart- ment or authority shall bo avoided; and the use of the streets, ave- nues, places and lands designated by the commissioners and the right. 58 RAILROAD LA.W. of way through the same for the purpose of a railway, as herein authorized, shall be considered and is hereby declared to be a public use, consistent with the uses for which the roads, streets, avenues and public places are publicly held. No such corporation shall have the right to acquire the use or occupancy of public parks or squares in any such city or county, or the use or occupancy of any of the streets or avenues, except such as may have been designated for the route or routes of such railway, and except such temporary privileges as the proper authorities may grant to such corporations to facilitate such construction, and no such railway shall be constructed across the track of any steam railway now in actual operation at the grade thereof, nor shall any piers or supports for any elevated railway be erected upon a railway track now actually in use in any street or avenue ; and no such corporation shall construct a street surface railroad to run in whole or in part upon the surface of any street or highway under the pro- visions of this article. 130. Crossing of horse railroad track. Whenever the route selected by the commissioners for the construction of such railway shall intersect, cross or coincide with any horse railway track occupy- ing the surface of the street or avenues, such railway corporation is hereby authorized to remove, for the purpose of constructing its road, the tracks of such horse railway ; but the same shall be done in such manner as to interfere as little as possible with their practical opera- tion or working, and upon the construction of such railway, where such removals or changes have been made, the same shall be restored as near as may be to the condition in which they were previous to the construction of such railroad. All such removals and restorations/shall be made at the proper cost arid charges of such corporation, but no authority is herein given to any such corporation to use the tracks of any horse railway. 131. Where route coincides -with another route. Whenever the route or routes determined upon by the commissioners coincide with the route of routes covered by the charter of an existing corpora- tion, formed for the purpose of constructing and operating such a railway, and it has not forfeited its charter or failed to comply with the provisions thereof, requiring the construction of a road or roads within the time therein prescribed, such corporation shall have the like power to construct and operate such railway upon the fulfillment of the like requirements and conditions imposed by the commissioners as a corporation specially formed under this article, and the commis- sioners may fix and determine the route or routes by which any elevated steam railway now in actual operation may connect with 59 RAILROAD LAW. other steam railways or the depots thereof, or with steam ferries, upon making compensation therefor, and in case such corporations can not agree vdth the owners of such steam railways, depots or ferries upon the amount of such compensation, and such owners may be entitled to compensation therefor, the amount of such compensation shall be Ascertained and paid in the manner prescribed in the condemnation law, and upon fulfillment by such elevated railway corporation, so far as it relates to such connection, of the requirements and conditions imposed by this article, it shall possess all the powers conferred by section 129 of this article, and when any connecting route or routes shall be so designated, such elevated railway corporation may con- struct such connection with all the rights and with like effect sis though the same had been part of the original route of such railway. Amended 1892. Typographical error corrected. 132. Commissioners to transfer plans, etc. Within one month after such corporation shall have been formed and organized in the manner hereinbefore provided, the commissioners shall transfer and deliver to the corporation all plans, specifications, drawings, maps, books and papers in their possession, and they shall, within the like period of one month after the organization of such corporation, cause to be paid to the treasurer thereof all money collected under the pro- visions of this article, after deducting therefrom the necessary expenses incurred by the commissioners and the amounts due to them for their salaries. 133. Commissioners to file report ; confirmation thereof. The commissioners shall within one hundred and forty days after their appointment, make a report to a special term of the supreme court of the department in which such railway may be located, of the amount of the pecuniary damage arising from the diminution of value of each parcel of property bounded on that portion of the street or streets, highway or highways, upon which it is proposed to construct such railway or railways, which will be caused by the construction, main- tenance and operation thereof. The name and place of residence of the owner or owners of each parcel shall be stated if the same are known, or can be ascertained, and if not known the name of tho per- son or persons appearing by the certificate of the clerk or register of the county, to have the title thereto from the records in his office, and a specific description of each parcel of property with reasonable cer- tainty. The testimony, if any, taken by the commissioners as to the amount of such damage, shall accompany their report. Within thirty days after filing and recording its certificate of incorporation, the cor- poration authorized to construct and operate such railway or railways 60 RAILROAD LAW. shall move to confirm such report by giving notice of such motio?\ to the property owners in the manner in which notice of the- time and place of hearing before the commissioners is required by section 125 to be given, and if the corporation fails to so nr.jve, any property owner may make the motion ; and thereafter the proceedings shall be <<> ..- din-ted in the manner prescribed in the condemnation law. Bei'mc omsfTucting and operating its railway in front of any real property bounded upon any street, avenue or public place wherein the corpora- tion is authorized by the certificate and report of the commissioners lo construct and operate its road, such corporation .shall pay to the owner of the real property the damages sustained or which will be sustained by him in consequence thereof, as finally fixed and ascertained, and the costs allowed him, if any, and the court may direct that such damages be paid out of the moneys deposited pursuant to the provis- ions of section 125, or in case negotiable securities shall have been deposited in lieu of money, that so much of such securities shall be sold as may be necessary to raise the amount required to be paid to such owner for damages and costs if any. If a bond shall have been executed in lieu of such deposit, the court may order the sureties in such bond to pay the damages so fixed and ascertained, and in default thereof, may cause them to be proceeded against and punished as for a contempt of court. 134. Pay of commissioners. Each of the commissioners shall be paid for his services at the rate of ten dollars per day for each day of actual service as such commissioner, and all expenses necessarily incurred by him in the discharge of his duties, to be paid by such cor- poration, but if a sufficient amount of capital stock shall. not be sub- scribed within one year after the appointment of such commissioners to authorize the formation of such corporation, the commissioners shall receive no salary, and shall cause to be returned to the subscribers for such stock the amounts paid in by them, after deducting there- from the necessary expenses incurred by the commissioners, but the time, if any, unavoidably consumed by the pendency of legal proceed- ings shall not be deemed a part of any period of time limited by this article. 1H5. Quorum; term of office; removal; vacancies in board of commissioners. A majority of the members of any board of commissioners appointed under this article shall be a quorum for the transaction of any business or the performance of any duty or function, or the exercise of any power, conferred or enjoined upon them. Any commissioner may be removed for cause at any time by the power appointing him, but no commissioner shall be removed without due 61 RAILROAD LAW. notice and an opportunity to be heard in defense ; and no commis- sioner thus' removed is, or shall be eligible to be again appointed to the office of commissioner. In case of the death, resignation or removal from office of any commissioner the vacancy shall be filled by the power appointing him, within thirty days after such removal, or within thirty days after notice in writing to such appointing power given by some member of the board, or by the corporation hereinafter mentioned, of such death or resignation, and a certificate of every such appointment shall be filed as hereinbefore required. Except as otherwise provided by law, the terms of office of the commissioners shall determine and expire with the performance of their functions as .herein above prescribed. 186. Abandonment or change of route ; new commission- ers ; their powers and proceedings. Any corporation heretofore organized or hereafter to be organized under this article, its successor or assigns, which shall have constructed or put in operation a railway upon a part and not upon the whole of the route fixed, determined and located for such railway by a board of commissioners, may at any time apply for authority to abandon any portion of the route upon which the railway shall not have been theretofore constructed or shall not then be in operation, with or without a change and relocation of such portion, and with or without extension of the portion not aban- doned, or of any part thereof. Such application shall be made by petition in writing, addressed by such corporation to the board of supervisors of the county in which such portion of the route so desired to be changed or abandoned shall be situated, which is not within the limits of a city, or if such route, or any part thereof, shall be' within the limits of a city, to the mayor of the city, for the route or portion thereof within such city. Five commissioners may be appointed pur- suant to such an application as hereinafter provided, who shall be resi- dents of the county or city and who shall have full power as herein provided. When such application is made by a corporation heretofore organized such commissioners may be appointed within thirty days after presentation of the same by such board of supervisors, or, as the case may be, by such mayor. When such application is made by a corporation hereafter to be organized under this article, such board of supervisors, or, as the case may be, such mayor, may within t.hirty days after presentation of such application, indorse thereon their or his approval and direction that it may be presented to the supremo court in the manner provided in section 120 of this article, and such court may thereupon appoint such commissioners. Within ten days after his appointment each commissioner so appointed shall take, sub- scribe and file the oath and give and file the bond prescribed by sec- 62 RAILROAD LAW. tion 121 of this article ; and if any one so appointed shall not comply with this requirement, he shall be deemed to have declined to accept such appointment, and to have made a vacancy which the appointing power shall fill by another appointment as herein provided. Within fifteen days after such appointments shall have been so made, the commis- sioners shall meet at some convenient place in such county and complete their organization as a board with appropriate officers. Such board shall have all the authority conferred by law upon commissioners appointed, or authorized to be appointed under this article. Before proceeding to hear the application of the corporation, the board shall give such public notice as it may deem most proper and effective of the time and place of the hearing. Within thirty days after completing their organization such board shall hear the application of the corporation, and all parties who may be interested therein, and within sixty days after their organization they shall determine whether any part of such route should be authorized to be abandoned, or should be changed and relocated with or without extension or extensions. If the board shall determine that no abandonment of any part of the route should be allowed, and that no change and relocation of any part thereof should be effected, and that no extension should be made, the board shall dismiss the application. If The board shall determine that an abandonment of any portion of the route should be allowed, or that any change in or extension thereof should be made, the board shall proceed to authorize and require the same upon such conditions as to the board shall seem proper, and with or without extension of the remainder of the route or of any part thereof, by fixing, determining and locat- ing the route or routes of the extension or extensions, if any, and by directing the abandonment of the part of the route theretofore located, but by the board allowed to be abandoned, if any, and by fixing, determining and relocating the part of the route theretofore located, but by the board changed, if any ; and the board shall cause to be made in duplicate a survey and map of the route as so changed and fixed, determined and located. Neither such corporation nor any assign or successor thereof shall thereafter have any authority, by reason of anything done under this article to operate or construct any railway upon any portion of the route by the board so required to be abandoned. The board shall also fix and determine the time within which the railway by it authorized and required upon any portion of the route so changed, shall be reconstructed and ready for operation. If the railway or any portion of the route not by the board changed or allowed to be abandoned, shall not have been theretofore constructed and made ready for operation, the board may extend, and fix and determine anew the time within which such railway shall be com- pleted, but such extension of time shall not be for a longer period than 63 RAILROAD LAW. that originally allowed by law for the completion thereof. If the board shall have determined that any portion of the route theretofore located should be allowed to be abandoned, with or without a change or relocation thereof or any part thereof, and with or without exten- sion, or if the board shall have extended the time within which such railway shall be completed, the board shall make a report in writing iu accordance with the determination so made, describing the portion of the route, if any there be, as so fixed, determined and located anew, and the part, if any there be, of the route allowed to be aban- doned, and stating the period of time, if any, by the board fixed and determined within which such corporation shall construct and com- plete the railway theretofore authorized or by it authorized to be con- structed, and prescribing that a failure by the corporation, its successors or assigns, to complete it within the time, if any so limited, shall work a forfeiture to the supervisors of the county if no part of the road is within a city, or in any city, to such city, of the rights and franchises of such corporation with respect to that portion of the route so fixed, determined and located anew, and with respect to the then authorized extension or extensions, if any there be of said route, 'upon which a railway shall not be constructed within the time so limited; but the time, if any, unavoidably consumed by the pendency of legal proceedings, shall not be deemed a part of any period of time limited in this article, and any recital of any forfeiture of any of the rights or franchises prescribed by any commis- sioners heretofore appointed, to be to the mayor, aldermen and com- monalty of the city of New York, shall be as effectual for any and all purposes as if such forfeiture had been in terms recited to be^to the board of supervisors of the county of New York. Such report shall be signed in duplicate by at least a majority of the then members of the board, and there shall be thereto annexed the survey and map as hereinabove directed, shoving the line and location of each and all the routes, with or without the extension or extensions, as fixed, deter- mined and located, and showing also the parts or part, if any there shall be, of the route or routes as theretofore fixed, determined and located, but by the board allowed to be abandoned. Within ten days after so signing such report the board shall cause the same to be filed in the office of the Secretary of State, and the duplicate thereof in the office of the clerk of the county wherein such railway shall be located ; and thereupon the corporation making such application, its successors or assigns, is and shall be authorized to construct, maintain and operate a steam railway for the transportation of passengers, mail and freight, upon tho route or routes so fixed, determined and located, and in said report described, but the construction or operation of a railway upon any new location or selection of route is not and shall not be thus 64 RAILROAD LAW. authorized except upon the condition that the consent of the owners of one-half in value of the property bounded on, and the consent also of the local authorities having control of that portion of a street or high- way upon which it is proposed to construct or operate such railway be first obtained, or in case the consent of such property owners can not be obtained, that the determination of three commissioners, to be upon application appointed by the general term of the supreme court, in the district in which such railroad is proposed to be constructed, be given after a hearing of all parties interested that such railway ought to be constructed or operated, which determination, confirmed by the court, may be taken in lieu of the consent of the property owners. Such corporation is and the successors and assign thereof shall be authorized to maintain and operate all the railroads and the appurtenance thereof by it or them theretofore constructed upon any portion of a route or routes which shall have been located" by commissioners under this article, and to complete within the time in and by such report so ex- tended, fixed and determined anew, and thereafter to maintain and operate, the railway and the appurtenances, upon so much of the route or routes theretofore fixed, determined and located as shall not have been so authorized and required to be abandoned, and with the same rights and effect, in all respects, as if such extended period of time had been originally fixed and determined, and in the original certificate of in- corporation of such corporation recited, for completing such railway and putting it in operation. The other terms and conditions in and by such certificate mentioned and prescribed, except as the same are hereinbefore modified or may be modified by the board as hereinabove authorized, shall apply to the railway herein authorized to be constructed and operated upon the route or routes as so changed, fixed, determined and located, with the same force and effect as if such route or routes, as finally so changed and located, had been in and by such articles or certificates themselves prescribed. If a new location or extension of routes shall be fixed and determined by commissioners who shall have been ap- pointed by the court pursuant to this section, they shall also ascertain and determine the aggregate pecuniary damages arising from the diminution of value of the property bounded on that portion of the street or highway upon the line of such new location or extension and of each parcel of real property so bounded, and their proceedings thereupon shall be conducted in the same manner and upon the like notice as the proceedings for that purpose before the commissioners specified in section 125, and shall make to the supreme court the re- port required by section 133, and thereupon the same proceeding shall be had as are provided for in such last named section. Each com- missioner shall be paid for his services at the rate of ten dollars per day for each day of actual services as such commissioner, and all b'5 RAILROAD LAW. reasonable expenses incurred by him in or about any of the matters re- ferred to such board, to be paid by the corporation making the appli- cation so heard and determined. No corporation shall be authorized under this section to extend, abandon or change the location of its route, or any part thereof, where the greater portion of the route or routes is or shall be in that portion of the city of New York south or west of Harlem river, or of any route or part thereof in the city of Brooklyn or county of Kings, or to construct, extend, abandon or change the location of any railway or route for a railway over, under, through or across any street, avenues, place or lands south of One Hundred and Twenty-eighth street or west of Third avenue in that portion of the city of New York south or west of Harlem river, or where a railway might not by law be constructed, or was not by law authorized to be by a board of commissioners located on the 5th day of June, 1888. 137. Increased deposit, when and how required. In case any of the securities deposited in lieu of money as provided in section one hundred and twenty-five, shall in the opinion of the county treas- urer or trust company with whom they may be deposited, fall below their actual value at the time of deposit, the county treasurer or trust company shall call upon such railway corporation to substitute there- for other securities equivalent at their par or market value to the amount in lieu of which the securities for which they are to be substi- tuted were deposited, and in case such other securities shall not be furnished, the county treasurer or trust company shall call upon such corporation to furnish as a substitute, and it shall so furnish an amount of money equal to the amount in lieu of which the securities first above referred to were deposited. 138. Trains to come to full stop, etc. All trains upon ele- vated railroads shall come to a full stop before any passenger shall be permitted to leave such trains ; and no train on such railroad shall be permitted to start until every passenger desiring to depart therefrom shall have left the train, provided such passenger has manifested his 01 her intention to so depart by moving toward or upon the platform of any car; nor until every passenger upon the platform or station at which such train has stopped, and desiring to board or enter such cars, shall have .actually boarded or entered the same, but no person shall be permitted to enter or board any train after due notice from an authorized em- ployee of such corporation that such train is full and that no more passengers can be then received. 139. Gates or vestibule doors. Every car used for passengers upon elevated railroads shall have gates at the outer edges of its platforms, so constructed that they shall, when opened, be caught 66 RAILROAD LAW. and held open by such catch or spring as will prevent their swing- ing and obstructing passengers in their egress from or ingress to such cars, or vestibule doors so constructed as to slide into the body cf the car; mid every such gate or door shall be kept closed while the car is in motion; and when the car has stopped and a gate or doer has been opened, the car shall not start until such gate or door is again firmly closed. Amended by ch. 273 of 1903. In effect April 24, 1903. 140. Penalty for violation of this article. Any elevated rail- road corporation that shall fail or neglect to comply with or enforce the provisions of this article, shall upon the petition of any citizen to any court of record, and upon due notice to such corporation, and proof of such failure or neglect, pay to the clerk of the court wherein such peti- tion was made, a sum not less than two hundred and fifty nor more than one thousand dollars, as such court may direct by its order. The sum so ordered to be paid shall be paid by such clerk of the court to- the county treasurer, and shall be distributed by such treasurer equally among the public hospitals of the county in which the proceed- ing is had, at such time, as the board of supervisors or board of aldermen in any such county shall direct. Nothing in this section shall relieve elevated railroad corporations from any liability under which they may now be held by existing laws for damages to persons or property. 141. Sections to be printed and posted. The officers and board of directors of such railroad corporations shall cause copies of sections one hundred and thirty-eight, one hundred and thirty-nine and one hundred and forty to be printed conspiciously and posted in the depots or stations arid in each car belonging to them. 142. Extension of time. The time within which any act is re- quired to be done under this article may be extended by the supreme court for good cause shown, for one year, and but one extension will be granted. Any company that has heretofore constructed or is now operating an elevated railroad shall be deemed to have been duly incorporated withstanding any failure on the part of commissioners to insert in its articles of association provisions complying with statutory requirements relative to such articles. New. ARTICLE VI. THE BOARD OP RAILROAD COMMISSIONERS. SECTION 150. Appointment and term of office of railroad commissioners. Iril. Suspension from offine. 1 ?12. Serrftary and marshal of hmrd. 1'3. Additional officers ; their dii'ics. 67 RAILROAD LAW. SECTION 154. Oath of office ; eligibility of officei-s of board. 155. Principal officer arid meetings of board. 156. Quorum of board. 157. General powers and duties of board. 158. Reports of railroad corporations. 159. Investigation of accidents. 160. Recommendations of board where law has been violated. 161. Recommendations of board when repairs or other changes are necessary. 162. Legal effect of recommendation and action of the board. 163. Corporation must furnish necessary information. 164. Attendance of witnesses and their fees. 165. Fees to be charged and collected by the board. 166. Annual report of board. 167. Certified copies of papers filed to be evidence. 168. Acts prohibited. 169. Salaries and expenses of members and officers of the board. 170. Total annual expense to be borne by railroads. 171. Application of this article. 150. Appointment and term of office of railroad commis- sioners. There shall continue to be a board of railroad commissioners, consisting of five competent persons, one of whom shall be experi- enced in railroad business, appointed by the Governor, by and with the advice and consent of the senate, each of whom shall hold office for the term of five years, and until his successor shall have been appointed and shall have qualified. A commissioner shall in like manner be appointed upon the expiration of the term of any commissioner; and when any vacancy shall occur in the office of any commissioner, a commissioner shall in like manner be appointed for the residue of the term. If the senate shall not be in session when the vacancy occurs, the Governor shall appoint a commissioner to fill the vacancy, subject to the approval of the senate when convened. Amended by ch. 728 of 1905. In effect June 3, 1905. 151. Suspension from office. Any commissioner may be sus- pended from office by the Governor upon written charges preferred. The Governor shall report such suspension and the reasons therefor to the senate at the beginning of the next ensuing session, and L" a majority of the senate shall approve the action of the Governor, such commissioner shall be removed from office and his office become vacant. 152. Secretary and marshal of board. The board shall have a secretary and a marshal, who shall be appointed by it and serve during its pleasure. The secretary shall keep a full and faithful record of the proceedings of the board, and be the custodian of its records, and file and preserve at its general office all books, maps, documents and papers intrusted to his care, and be responsible to the board for the same. Under the direction of the board he shall be its chief executive officer, shall have general charge of its office, superintend its clerical business, conduct its correspondence, be the medium of its decisions, recommendations, orders and bequests, prepare for service 68 RAILROAD LA\V. such papers and notices as may be required of him by the commission- ers, and perform such other duties as the board may prescribe, and he shall have power to administer oaths in all cases pertaining to the duties of his office. He shall have the power to designate froni time to time one of the clerks appointed by the board to act as assistant secre- tary during his absence from the county of Albany, and the clerk so designated for the time designated shall within the county of Albany only, possess the powers conferred by this section upon the secretary of the board. 153. Additional officers ; their duties. The board may also appoint, to serve during its pleasure, the following officers or aiiy of them : An accountant, who shall be thoroughly skilled iu railroad ac- counting, and who shall, under the direction of the board, make exami- nations of the books and accounts of railroad and other corporations, and supervise the quarterly and annual reports made by the railroad corporations to the board, and collect and compile railroad statistics, and perform such other duties as the board may prescribe. An inspec- tor, who shall be a civil engineer, skilled in railroad affairs ; also, an inspector, who shall be an expert in electrical railroad affairs, each of whom shall make such inspections of railroads and other matters relat- ing thereto, as directed by the board, and report to it. Such additional clerical force as may be necessary for the transaction of its business. The board may also employ engineers, accountants and other experts whose services they may deem to be of temporary importance in con- ducting any investigation authorized by la-w. Am'd by eh. 456 of 1896. In effect May 9, 18Q6. 154. Oath of office ; eligibility of officers of board. Each commissioner, and every person appointed to office by the board, shall, before entering upon the duties of his office, take and subscribe the constitutional oath of office. No person shall be appointed to or hold the office of commissioner or be appointed by the board to, or hold any office, place or position ander it who holds any official relation to any railroad corporation, or owns stock or bonds therein, or who is in any manner pecuniarily interested in any firm or corporation having business relations with any such corporation. 155. Principal office and meetings of boards. The princi- pal office of the board shall be at the city of Albany, in rooms desig- nated by the capitol commissioners, and it may have a branch office at the city of New York, and one at the city of Buffalo ; and the board or a quorum thereof, shall meet at least once a month during the year at the office in Albany. The board shall have an official seal, to be prepared by the Secretary of State in accordance with law, and its offices shall be supplied with necessary postage, stationery, office fur- niture and appliances, so be paid for as other expenses authorized by this article, and it shall have prepared for it by the state the necessary 69 RAILROAD LAW. books, maps and statistics, incidentally necessary for the dis- charge of its duties. 156. Quorum of Loard. Tiiree of the commissioners shall con- stitute a quorum for the transaction of any business, cr the per- formance of any duty of the board and may hold meetings thereof at any time or place within the state. All examinations or inves- tigations made by the board may be held and taken by and before any one of the commissioners or the secretary of the board, by the order of the board, and the -proceedings and decisions of such single commissioner or secretary, shall be deemed to be the pro- ceedings and decisions of the board, when approved and con- firmed by it. Amended by ch. 728 of 1905. In effect June 3, 1905. 157. General powers and duties of board. The board shall have power to administer oaths in all matters relating to its duties, so far as necessary to enable it to discharge such duties, shall have gen- eral supervision of all railroads and shall examine the same and keep informed as to their condition, and the manner in which they are operated for the security and accommodation of the public and their compliance with the provisions of their charters and of law. The commissioners or either of them in the performance of their official duties may enter and remain during business hours in the cars, offices and depots, and upon the railroads of any railroad corporation within the state, or doing business therein; and may examine the books and affairs of any such corporation and compel the production of books and papers or copies thereof, and the board may cause to be subpoenaed witnesses, and if a person duly subpoenaed fails to obey such subpoena without reasonable cause, or shall without such cause refuse to be examined, or to answer a legal or pertinent question, or to produce a book or paper which he is directed by subpoena to bring, or to sub- scribe his deposition after it has been correctly reduced to w r riting, the board may take such proceedings as are authorized by the Code of Civil Procedure upon the like failure or refusal of a witness subpoenaed to attend the trial of a civil action before a court of record or a referee appointed by such court. The board shall also take testimony upon, and have a hearing for and against any proposed change of the law relating to any railroad, or of the general railroad law, if requested to do so by the legislature, or by the committee on railroads of the senate or the assembly, or by the Governor, and may take such testimony and have such a hearing when requested to do so by any railroad corpora- tion, or incorporated organization representing agricultural or com- mercial interests in the state, and shall report their conclusions in writing to the legislature, committee, Governor, corporation or organi- zation making such request; and shall recommend and draft such bills as will in its judgment protect the people's interest in and upon the railroads of this state. 70 THE RAILROAD LAW. 158. Reports of railroad corporations. The board shall pre- scribe the form of the report required by the railroad law to be made by railroad corporations, and may from time to time make suHi changes and additions in such form, giving to the corporation six months notice before the expiration of any fiscal year, of any changes or additions which would require any alteration in the method or form of keeping their accounts, and on or before June thirtieth in each year, shall furnish a blank form for such report. When the report of any corporation is defective, or believed to be erroneous, the board shall notify the corporation to amend the same within thirty days. The originals of the reports, subscribed and sworn to as prescribed by law, shall be preserved in the office of the board. Amended by ch. 158 of 1904. In effect March 28, 1904. 159. Investigation of accidents. The board shall investigate the cause of any accident on any railroad resulting in loss of life or injury to persons, which in their judgment shall require investigation, and include the result thereof in their annual report to the legisla- ture. Before making any such examination or investigation, or any investigation or examination under this article, reasonable notice shall be given to the corporation, person or persons conducting and manag- ing such railroad of the time and place of commencing the same. The general superintendent or manager of every railroad shall inform the board of any such accident immediately after its occurrence. If the examination of the books and affairs of the corporation, or of witnesses in its employ, shall be necessary in the course of any examination or investigation into its affairs, the board, or a commissioner thereof, shall sit for such purpose in the city or town of this state where the principal business office of the corporation is situated if requested so to do by the corporation ; but the board may require copies of books and papers, or abstracts thereof, to be sent to them to any part of this state. 160. Recommendations of board, -where law has been violated. If, in the judgment of the board, it shall appear that any railroad corporation has violated any constitutional provision or law, or neglects in any respect to comply with the terms of the law by which it was created, or unjustly discriminates in its charges for services, or usurps any authority not granted by law, or refuses to comply with the provisions of any law, or with any recommendation of the board, it shall give notice thereof in writing to the corporation, and if the violation, neglect or refusal is continued after such notice, the board may forthwith present the matter to the Attorney-General, who shall take such proceedings thereon as may be necessary for the protection of the public interests. 71 HAILROAD LAW. g 1 ; ! . Recommendations of board, when repairs or other changes are necessary. If in the judgment of the board, after a careful personal examination of the same, it shall appear that repairs are necessary upon any railroad in the state, or that any addition to the rolling stock, or any addition to or change of the station or station-houses, or that additional terminal facilities shall be afforded, or that any change of the rates of fare for transporting freight or pas- sengers or in the mode of operating the road or conducting its busi- ness, is reasonable and expedient in order to promote the security, convenience and accommodation of the public, the board shall give notice and information in writing to the corporation of the improve- ments and changes which they deem to be proper, and shall give such corporation an opportunity for a full hearing thereof, and if the cor- poration refuses or neglects to make such repairs, improvements and changes, within a reasonable time after such information and hear- ing, and fails to satisfy the board that no action is required to be taken by it, the board shall fix the time within which the same shall be made, which time it may extend. It shall be the duty of the corpo- ration, person or persons owning or operating the railroad to comply with such decisions and recommendations of the board ns arc just ar.d rsaronable. If it fails to do so the board shall present the facts in tl.c case to the attorney-general for his consideration and action, and slinll also report them in its annual or in a special report to the legislature- Elevated railroad corporations are included in the application of this section. Amended by ch. 873 of 1903. In effect April 3, 1902. 162. Legal effect of recommendations and action of the board. No examination, request or advice of the board, nor any in- vestigation or report made by it, shall have the effect to impair in any manner or degree the legal rights, duties or obligations of any railroad corporation, or its legal liabilities for the consequence of its acts, or of the neglect or mismanagement of any of its agents or employes. The supreme court at special term shall have power in its discretion, in all cases of decisions and recommendations by the board which are just and reasonable to compel compliance therewith by mandamus, subject to appeal to the general term and the court of appeals, and upon such appeal, the general term and the court of appeals may review and re- verse upon the facts as well as the law. 1(33. Corporations must furnish necessary information. Every railroad corporation shall, on request, furnish the board any necessary information required by them concerning the rates of fare for transporting freight and passengers upon its road and other roads with which its business is connected, and the condition, management and operation of its road, and shall, on request, furnish to the board copies of all contracts and agreements, leases or other engagements 72 RAILROAD LAW. entered into by it with any person or corporation. The commissioners Khali not give publicity to such information, contracts, agreements, leases or other engagements, if, in their judgment, the public interests do no* require it, or the welfare and prosperity of railroad corporations >f the state might be thereby injuriously affected. 3 164. Attendance of witnesses and their fees. All subpoanas .lia.ll be issued by the president of the board, or by any two members thereof, and may be served by any person of full age authorized by the board to serve the same. The fees of witnesses before the board shall be two dollars for each day's attendance, and five cents for every mile of travel by the nearest generally traveled route in going to and returning from the- place where the attendance of the witness is required, and the fees shall be audited and paid by the Comptroller on the certificate of the secretary of the commission. 165. Fees to be charged and collected by the board. The board shall charge and collect the following fees : For copies of papers and records not required to be certified, or otherwise authenticated by the board, ten cents for each folio of one hundred words ; for cer- tified copies of oflicial documents filed in its office, fifteen cents for each folio, and one dollar for every certificate under seal affixed thereto ; for each certified copy of the quarterly report made by u railroad cor- poration to the board, fifty cents ; for each certified copy of the annual report of the board, one dollar and fifty cents ; for certified copies of evidence and proceedings before the board, fifteen cents for each folio. No fees shall be charged or collected for copies of papers, records or official documents, furnished to public officers for use in their official capacity, or for the annual reports of the board in the ordinary course of distribution. All fees charged and collected by the board belong to the people of the state, and shall be paid quarterly, accompanied with a detailed statement thereof into the treasury of the state to the credit of the general fund. 166. Annual report of board. The board shall make an annual report on or before the second Monday in January in each year, which shall contain : 1. A record of their meetings and an abstract of their proceedings during the preceding year. 2. The result of any examination or investigation conducted by them. 3. Such statements, facts and explanations as will disclose the actual workings of the system of railroad transportation in its bearing upon the business and prosperity of the state, and such suggestions as to the general railroad policy of the state, of the amendment of its laws, or 73 RAILROAD LAW. the condition, affairs or conduct of any railroad corporation, as may seem to them appropriate. 4. Drafts of all bills submitted by them to the legislature and the reasons therefor. 5. Such tables and abstracts of all the reports of all the railroad corporations as they may deem expedient. 6. A statement in detail of the traveling expenses and disburse- ments of the commissioners, their clerks, marshal and experts. Five hundred copies of the report with the reports of the railroad corporations of the state, in addition to the regular number prescribed by law, shall be printed as a public document of the state, bound in cloth for the use of the commissioners, arid to be distributed by them in their discretion to railroad corporations and other persons interested therein. 167. Certified copies of papers filed to be evidence. Copies of all official documents filed or deposited according to law in the office of the board, certified by a member of the board or the secretary thereof to be true copies of the originals under the official seal of the board, shall "be evidence in like manner as the originals. 168. Acts prohibited. No railroad commissioner shall, directly or indirectly, solicit or request from, or recommend to any railroad corporation, or any officer, attorney or agent thereof, the appointment of any person to any place or position nor shall any railroad corpora- tion, its attorney or agent, offer any place, appointment or ^position or other consideration to such commissioners, or either of them, nor to any clerk or employe of the commissioners or of the board ; neither shall the commissioners or either of them, nor their secretary, clerks, agents, employes or experts, accept, receive or request any pass from any railroad in this state, for themselves or for any other person, or any present, gift or gratuity of any kind from any railroad corpora- tion ; and the request or acceptance by them, or either of them, of any such place or position, pass, presents, gifts or other gratuity thali work a forfeiture of the office of the commissioner or commissioners, secretary, clerk or clerks, agent or agents, employe or employes, expert or experts, requesting or accepting the same. 1 69. Salaries and expenses of members and officers of the board. The annual salary of each commissioner shall be eiizht thou- sand dollars ; of the secretary six thousand dollars; of the marshal iif- teen hundred dollars; of the accountant and of the inspector such sum as. the board may fix, not exceeding three thousand dollars each ; t f the clerical force such sums respectively as the board may fix. In the 74 RAILROAD LAW. discharge of their official duties, the commissioners, their officers, clerks and all experts and agents whose services are deemed tempor- arily of importance, shall be transported over the railroads in this state free of charge upon passes signed by the secretary of state and the commissioners shall have reimbursed to them the necessary travel- ing expenses arid disbursements of themselves, their officers, clerks and experts, not exceeding in the aggregate nine hundred dollars per month. All salaries and disbursements shall be audited and allowed by the comptroller and paid monthly by the state treas- urer upon the order of the comptroller out of the funds provided therefor. Amended by ch. 728 of 1905. In effect June 3, 1905. 170. Total annual expense to be borne by railroads. The total annual expense of the board authorized by law, exceptii-g only rent of offices and the cost of printing and binding the annual reports of the board as provided by law, shall not exceed one hundred thousand dollars ; and shall be borne by the several cor- porations owning or operating railroads according to their means, to be apportioned by the comptroller, who, on or before July first, in each year, shall assess upon eacL of such corporations its proportion of such expenses, one-half in proportion to its net income for the fiscal year next preceding that in which the assess- ment is made, and one-half in proportion to the length of its main road and branches, except that each corporation whose line of road lies partly within and partly without the state, shall in respect of its net income be assessed on a part bearing the same proportion to its whole net income that the line of its road within the state bears to the whole length of road, and in respect of its main road and branches shall be assessed only on that part which lies within the state. Such assessment shall be collected in the manner provided by law for the collection of taxes upon cor- porations. Amended by ch. 456 of 1896. In effect May 9, 1896. .amended by ch. 728 of 1905. In effect June 3, 1905. 171. Application of this article. The provisions 01 this article shall apply to all railroads within the state, and the corporations, receivers, trustees, directors or others, owning or operating the same or any of them, and to all sleeping and drawing-room car corporations, and to all other associations, partnerships or corporations en.-, transporting passengers or freight upon any such railroad as les otherwise. 172. The railroad commissioners may in their discretion act as judges to award prizes which may be offered by any responsible person for improvements in machinery or appliances for operating railroads. Added by chap. 452 of 1894. Took effect May 3, 1894 75 SECTIONS 180 TO 183 INCLUSIVE OF CHAR 5G5 OF IC'JO WEKE REPEALED BY CHAR 676 OF 1892. UXDr ) SECTION 180, THUS BEREALED, THE FOLLOWING LAWS WEKE EEPE ALED : SCHEDULE OF LA.WS REPEALED. Laws of Tiapter SECTIONS. 183G 316 1, 2. 1838 ICO 2, 3. 1838 1G1 All. 1839 218 1. 1S46 155 1. 1846 215 17, 18. 18-17 100 3, 4. 1847 1847 222 270 1. 3 to 10, both inclusive. 1847 1847 272 404 All. All. 1850 140 1, 2, 12 to 28, both inclusive* 30 to 37 1851.. . 19 both inclusive; 40, 43 to 51, All. both in- fclnsiv 1S51 497 All. 1S54 140 All. 1854 1855 282 302 4 to 15, both inclusive: 17, 18. All. 1855 478 1. 1857 185 1. 1857 444 All. 1858 125 All. 18G3 . . 346.. All. 76 EC1IEDLTLK OF LAWS UEPKALED Continued. Laws of Chapter SECTIONS. 1864 532 2, 3. 1865 240 I. 18GG 697 All. 1867 254 1. 1867 515 1. 1867 775 1. 1863 573 All. 18G9 844 1. 1869 917 All. 1871 560 2, 3, 5, 6, 7. 1372 829 All. 1872 843 2. 1S73 432 All. 1374 430 All. 1875 108 1. 1375 256 All 1875 586 1, 2, 3. 1875 598 1. 1875 606 1 to 9, 14 to 30, 33 to 51, all incJuai** 1876 198 2. 1878 261 1. 1879 395 1. 1879 415 1, 2. IS79 505 All. 1880 5 All. 1880 1. 1880 223 1, 3, 4, 5. 1880 267 All. 1880 349 1. 1880 415. All. 1880 582 All. 1881 148 1. 1881 338 1. 1881 399 All. 1881 468 1, 2, 3, 5, 6 V 9, IS- 1881 470 1. 1881 . . . 485 2, 3. 1882 140 1. 1882 . . . 273 2. 1882 349 All. 1882.... 353 All. 1882 393 5. 1882 405 1, 2. 1883 386 AIL 1884 1 93 All. 1 884 223 All. 1884 252 All. 1884 421 AIL 1884 1884.. 4'>2 439 2. AIL SCHEDULE OP LAWS REPEALED Continued. Laws of Chapter SECTIONS. 1884 441 AIL 1S85 305 All. 1885 498 1. 1886 65 1. 188G 271 All. 1386 403 All. 1S86 G05 All. 1886 642 All. 1887 1887 536 616 All. AIL 1888 ] 89 2 1888 514 3. 1888 549 All. 1888 < 60 All. 1889 76 1 1889 236 All 1889 242 All. 1889 281 All. 1889 531 All. 1889 532 All. 1889 504 All. INDEX. A. SECTION Abandonment, and change of road of steam railways in cities 136 of part of road by street surface railroads 103 Accidents, investigation of, by railroad commissioners 159 Accommodation of connecting roads 35 Acquiring, real property for construction of road 4 title to real property 7 Acts, certain, by railroad commissioners prohibited 168 Additional, corporate powers of railroads running into foreign countries. . 18. lands for intersection of highways 11 officers for R. R. Commissioners 153 duties of 153 powers conferred on railroad corporations 4 safe-guards, R. R. commissioners may approve 50 Adoption of plans and terms upon which steam railways in cities, etc., shall be built v 124 Affidavit attached 10 certificate of incorporation, what to contain 2 Agreement to consolidate, etc., to be submitted to stockholders 71 Alteration of route of railroad 6 Alteration or reduction of fare by Legislature 38 Alteration of crossing* in village.?, etc 62 Amount of capital stock on consolidation 71 Annual expense of R. R. commission to be borne by railroads 170 Annual report, must be made 57 of R. K. commissioners 166 Application of statute relating to consolidation 84 for construction of other road in cities and counties , 120 Appointment of R. R. commissioners 150 Application of article 6 of Railroad Law 171 Appraisal of damages and deposit of money as security for steam rail- ways in cities, etc 125 Articles of incorporation of railroads 2 Assessment of property after consolidation 74 Attendance of witnesses before R. R. commissioners 164 Automatic, brake 49 couplers 49 B. Badges to be worn by conductors and employees 43 Baggage, checks for 44 unclaimed 46 79 INDEX. SECTION Board of R. R. commissioners 1 50- 171 total expenses to be borne by railroads 170 Brakemen as policemen 58 Brakes ". 49 Bridge, crossing by street surface railroads 102 Buffalo, exception as to change of grade in 13 as to grade crossings in 69 Buildings and stations, railroad company may erect 4 c. Canal, railroad may cross 4 Canada thistles to be cut 52 Capital stock, amount to be paid in cash, preliminary 2 of railroad, amount required 2 certificate of incorporation to specify 2 Cattle guards 32 Centre-bearing rails prohibited ! 109 Certain roads to cease in winter 55 Certificate, of stock may be issued after foreclosure in certain cases 82 of incorporation of railroads 2 effect of filing before stock paid in 2 kind of railroad to be specified 2 supplemental _. 3 what to contain 2 affidavit concerning, what to contain 2 of incorporation of steam railways in cities, etc 126-128 of incorporation, verification of 2 of incorporation, when payment of capital stock to be recited in. ... 2 of incorporation, when void 2 Certified copy of paper filed with R. R. commissioners, to be evidence. ... 167 Change of route, grade or terminus 13 Changes, recommendations by K. R. commissioners of 161 Chautauqua Assembly, railroads through 10 Checks, for connecting steamboats 47 tor baggage 44 Classification of stock, certificate of incorporation to specify 2 Commissioners for steam railways, in cities, appointment of 120 adoption of plans by 124 appraisal of damages 125 bond of 121 certificate of incorporation, shall prepare 12(5 to deliver * 128 determination of necessity for road 123 first meeting of 122 oath of ' 121 organization of board of 127 pay of 134 powers of 129 80 INDEX. Commissioners for steam railways, in cities Continued. SECTION quorum of ,.. 135 report of 133 term of office of 135 to transfer plans 132 vacancies 135 Commissioners, R. K., certain acts by, prohibited 168 fees to be charged and collected by 165 legal effect of recommendations of 162 when supreme court to appoint 96 Commissioners to examine route 6 report of 6 Common carriers not to give preferences . -. 34 railroad, rights and liabilities as 48 Common stock, certificate of incorporation to specny 2 rights and privileges of stockholders, certificate of incorporation to specify 2 Companies, liability of, to employees of contractor 30 must furnish necessary information to R. R. commissioners 163 may establisn ferries 54 of other states, powers of 77 owning continuous lines, consolidation of 70, 71, 72 Concourse lands, railroad through not allowed 8 Conditions upon consolidation, etc 71 Condition upon which consent to street surface railroads shall be given . . 93 Conductors, and brakemen as policemen 58 and employees must wear badges 43 persons employed as 42 Confirmation of report of commissioners for steam railways in cities. ... 133 Connecting roads, accommodation of 35 steamboats, tickets and checks for 47 Consent, of local authorities to street surface railroads 91, 92 of property owners to street surface railroads 91 to street surface railroads, condition upon which given for street surface railroads, former, ratified 106 Commissioners for steam railways, terms of Commissioners for street surface roa4s, when property owners do not consent 06 consent, of property owners of street railroads proceedings, when owners refuse to of local authorities upon what conditions given Consolidation, and lease of parallel lines prohibited lease, sale and reorganization of railroads 70. 8: Consolidated roads, forelosure by of companies, owning continuous lines 70, , 1 . conditions application of statute, etc INDEX. SECTION Construction of part of line in another state 14 of roads 4 of street surface railroads in streets where other roads are built . . . 102 operation and management of railroads 30-59 Contents of certificate of incorporation of railroads ' 2 Continuous lines, consolidation of companies owning 70, 71, 72 Contracting companies of street surface railroads to carry for one fare. . 104 Contractor, employees of, liability to 30 Contractor, employees of, liabilities of companies to 30 Corporate powers, when to cease 5 of railroad in foreign countries 18. Corporate rights of street surface railroads saved on failure to complete road 106 Corporations, generally may lay down and maintain railroad tracks 20 may establish ferry 54 must make annual report 57 must furnish necessary information to R. R. commissioners 163 Couplers 49 Creditors, rights not affected by consolidation 73 Crossings, grade, locomotives must stop at 36 mayor, etc., may petition for change of 62 of horse railroad track in cities, etc 130 signboards and flagmen at 33 D. Determination of, necessity for railroads, and of route in cities 123 Directors, certificate of incorporation to specify names and addresses of . . 2 numbers of, limited 2 of steam railways in cities, etc 128 Dissolution of street surface railroads, effect of 105 Drivers, persons employed as 42 Duties imposed to insure safety 49 of additional officers of R,. R. commissioners 153 of R. R. commissioners 157 E. Effect of dissolution of charter of street surface railroads as to consents. . 105 Ejection of passenger for refusing to pay fare 40 Electric light and power companies, powers of, etc 21 Eligibility of officers of board of R. R. commissioners , 154 Eminent domain, substituted lines in cases of 22 Employees must wear badges 43 of contractor, liabilities of companies to 30 of street surface railroad, protection of 111-111-a Entry upon lands for purposes of survey 4 Evidence, papers tiled with R. R. commissioners certified, copies of, to be. 167 Excessive fare, penalty for 39 Expense of R. R. commissioners and employees 169 total to be borne by railroads 170 82 INDEX. SECTION Extension of route of street surface railroads over rivers 96 Kxtcnsion of time to construct road in cities, etc 142 Extra fare for sleeping cars 41 F. Fare, for sleeping cars , 41 Legislature may alter or reduce 38 on street surface railroads, rate of 101 passenger refusing to pay may be ejected 40 penalty for excessive 39 rates of 37 Farm crossings, etc 32 Fees of railroad commissioners, etc ](;."> Fences, farm crossings and cattle guards 32 Ferries may be established by companies 54 Flagmen at crossings 33 Foreign countries, railroads running into 17 Foreign corporations, powers of on consolidation 77 Foreclosure, certificate of stock may be issued after, in certain cases. ... 82 of mortgages made by consolidation of railroads in this state. ... 76 sale, mortgagee may purchase at 81 Form of certificate of incorporation of railroads 2 Franchises of street surface railroads, sale of, at public auction 93 Freight and baggage, unclaimed 46 Furnaces, use of, in cars prohibited 51 G. Gates, railroad in cities to erect 139 General powers ol railroads 1-21 General powers ot K. R. commissioners 157 General provisions as to street surface railroads 90 Grade, change of 13 crossings, locomotives must stop at 36 crossings 60-69 Gripmen, persons employed as 42 Guard posts 49 H. Highway, railroad may cross additional lands for intersection of 11 crossings over, etc 60-69 I. Ice and snow, removal of, by street surface railroads 98 Increased deposit by steam railways in cities, when and how required.. 137 Incorporation of railroads certificate of, what to contain supplemental certificate of INDEX. SECTION Indian lands, railroads through 9 Individual may lay down and maintain railroad tracks 20 Injury to baggage, penalties for 45 Intersection of highways, additional lands for 11 of other roaus, etc. . : 4-12 Investigation of accidents by railroad commissioners 159 J. Joint agreement on consolidation . . 71 Joint stock association may lay down and maintain railroad tracks 20 K. Kind of railroad company, certificate of incorporation to specify 2 L. Lease of parallel lines, when prohibited 80 sale and reorganization of railroads 70-83 Leases of roads 78 Lessees of railroads may acquire stock 79 Legal effect, recommendation of R. R. commissioners 162 Legislature may alter or reduce fare 38 Length and termini of railroad, certificate of incorporation to -specify . . 2 Liabilities, as common carriers 48 of reorganized railroad companies 83 of companies to employees of contractor 30 Limitation of corporate rights of street surface railroads 106 Location, of principal office, companies running into foreign countries. . . 19 of railroads 1-21 of route of road 6 commissioners, when appointed 6 report of commissioners 6 alteration of, by commissioners 6 map showing alterations, if any, to be filed 6 hearing on petition of owner 6 map of, to be made and filed notice to be served 6 occupant aggrieved may apply to court for relief 6 Locomotives to stop at grade crossings 36 M. Maps of route to be filed 6 Mails 56 Management of railroads 30-69 Marshal of R. R. commissioners 152 Mayor may petition for change of grade 62 ^footings of R. R. commissioners 155 Merchandise of intersected road to be transmitted 12 Mortgage of property of railroad company, right to 4 84 INDEX. SECTION Mortgagee may purchase at foreclosure sale 81 Mortgages made by consolidated railroads, foreclosure of 76 Motive power of street surface railroads IOC Municipal companies, stock of, how represented 75 Municipal corporation may acquire lands adjacent to railroad, etc 63 N. Name of railroad corporation, certificate of incorporation to specify 2 Name of station in villages, etc 34 Narrow guage road, capital stock required t 2 New commissioners upon abandonment of route of steam railways in cities 136 New companies formed by consolidation, status and powers of 72 Notice of proposed route, service of 8 Notice of starting trains 34 o. Oath, and bond of commissioners for steam railways in cities, etc 121 of R. R. commissioners 154 Officers of street surface railroad to report receipts, etc.- 95 Operation and management of railroads 30-59 Organization of railroads 1-21 of steam railways in cities, etc 127 Overhead bridge, construction of 64 Owner or occupant, may apply to court to change route 6 P. Packages, penalties for injuries to 45 Parallel lines, consolidation and lease of, prohibited 80 Parlor cars, fare in 41 Part of line in another state, construction of 14 Passenger refusing to pay fare may be ejected 40 Pay of commissioners for steam railways in cities 134 Payment of capital stock in cash, to be specified in certificate Penalties applicable to steam railways in cities 140 for injury to baggage 45 for excessive fare for excessive fare by street surface railroads 104 for violation of railroad law by steam railroads in cities 140 Percentage of gross receipts to be paid in cities and villages by street surface railroads report of officers as to Persons employed as drivers and conductors transportation of, power of company Plank road, railroad may intersect Platform, riding on Policemen, conductors and brakemen as 58 INDEX. SECTION Power companies, powers of i'. 1 Powers, of companies of other states 77 of electric ligflt and power companies 21 of K. R. commissioners 157 of steam railways in cities, etc 129 of railroad companies, additional, granted 4 to acquire real property 4 to borrow money 4 to construct buildings 4 to intersect railroads 4 to intersect streams 4 to lay out road 4 to mortgage its property 4 to purchase lands in other states 4 to regulate time and manner of transportation 4 to transport persons and property 4 to unite with other roads 4 when corporate powers to cease 5 Principal office, of R. R. commissioner 2, 155 of railroad in foreign country 19 Preferences by commgn carriers forbidden 34 Preferred stock, certificate of incorporation to specify 2 rights and privileges of, certificate of incorporation to specify 2 Proceedings if property owners do not consent to street surface railroads. 94 Property, right of company to transport 4 assessment of, of new corporations 74 Protection of employees of street surface railroads lll_lllr\ Public buildings, street surface railroads not to be constructed upon ground occupied by 10S lands, railroads through & parks, tunnel not to be constructed under 1C parks, roads not to be constructed upon ground occupied by 108 Purchase of lands and stock in other states 4 Qualification of officers of R. R. commissioners 154 Quorum of R. R. commissioners 156 K. Rail, weight of 31 center-bearing, use of, by street surface railroad forbidden 109 Railroad act, application of 171 Railroad commissioners, board of 150-171 acts prohibited 168 appointment of commissioners 1 50 application of article 6, Railroad Law 171 additional officers 1 ^ duties of ! ; ' : ' annual report of 166 attendance of witnesses 164 INDEX. Railroad commissioners Continued. SECTION . certified copies of papers filed as evidence 167 corporation must furnish necessary information to 163 eligibility of officers of j f, j expenses of members, etc 169 fees to be charged 165 general powers and duties '. 157 investigation of accidents 1 59 legal effect of action by 162 marshal of 152 meetings of 155 oath of office 154 principal officer of 155 quorum of 156 lecommendations, where law violated 160 where repairs, etc., necessary 161 imports of railroad corporations 158 salaries 169 secretary of 152 suspension Irom office 153 total annual expense to be borne by railroads 170 Railroad companies, consolidation, lease, sale and reorganization 70-84 assessment of property of new corporation after 74 certificate of stock after foreclosure 82 conditions 71 of corporations owning continuous lines 70 creditors' rights not to be impaired 73 foreclosure by consolidated roads, etc 76 lease of road 78 lessees may acquire stock 79 liabilities of reorganized companies 83 mortgagee may purchase in foreclosure 81 new corporation 72 powers of corporations of other states 77 stock of municipal corporations, etc 75 statute relating to, application of 84 additional powers conferred on 4 location of route 6 may acquire real property 4 may borrow money 4 may construct buildings 4 may enter lands for purpose of survey 4 may intersect streams, etc 4 may intersect other railroads 4 may lay out and construct road 4 may mortgage corporate property, franchises to secure debts 4 may purchase lands in other states 4 may regulate time and manner of transportation 4 S7 INDEX. Railroad companies Continued. SECTION may transport persons and property 4 may unite with other roads 4 must restore highway intersected, etc 11 powers, additional, conferred on , 4 possess powers conferred by general and stock corporation laws .... 4 report of, to R. R. commissioners 158 reorganized, liabilities of 83 section 24 of Stock Corporations Law not applicable to 23 shall forward merchandise of other roads when crossing same 12 stations and buildings 4 time and manner of transportation by 4 transportation of persons and property 4 when corporate powers to cease 5 in foreign countries 17 law, chapter 39 of general laws, to be known as 1 not longer than sixteen miles, may operate during certain months. . 21 route of 6 station, consent of railroad commissioners to discontinuance neces- sary 34 Railroad, construction of other, in cities and counties 120-142 application for 120 commissioners, appointment of .- 120 adoption of plans by 124 appraisal of damages, etc 125 bond of 121 certificate of incorporation, shall prepare 126 to deliver 128 determination of necessity for road, etc i23 first meeting of 122 oath of 121 organization of 127 pay of 134 powers of 129 quorum of 135 report of, confirmation of 133 term of office of 135 to file report 133 to transfer plans, etc 132 vacancies, etc 1 35 crossing of horse railroad track 130 extension of term .. . . 142 gates 1:59 increased deposit , 131 penalty for violation of railroad law 140 route, abandonment or change of 13fi coinciding with other route 131 sections of law to be printed and posted 141 trains to come to full stop 138 88 INDEX. SECTION Railroads, certain, may cease operations in winter 55 certificate of incorporation of 2 effect of filing before stock paid in 2 kind of railroad must be specified in 2 what to contain 2 (supplemental - S construction, operation and management of 30-69 accommodation of connecting roads 3.5 Canada thistles to be cut 52 certain roads to cease in winter 55 checks for baggage 44 conductors to wear badges 43 corporation may establish ferry 54 corporation must make annual reports 57 duties imposed 4!) extra fare for sleeping car 41 fences, etc 12 grade crossings . . 6060 legislature may alter or reduce fare 38 locomotives at grade crossings :',(} liability to employees of contractor 30 mails 5(5 notice of starting trains 34 passenger refusing to pay fare 40 penalty for excessive fare 39 for injury to baggage , 45 rates of fare , 37 R. R. commissioners approve safeguards _. . 50 certify part of route 50a requisites as to future railroads 59 revocation' of consent 59b riding on platform 53 rights as common carriers 48 signboards 33 tickets for connecting boats 47 unclaimed freight 46 use of stoves prohibited 51 weight of rail 31 when conductors may be policemen 58 having same location l> incorporation of 2 intersecting each other 12 in foreign countries 17 additional corporate powers of 18 principal office of 19 management of - 30-69 operation of 30-69 organization of, general, powers and location of 21 89 INDEX. Railroads Continued. SECTION rights and liabilities as common carriers 4.3 supplemental certificate of incorporation of 3 surface steam, must avoid crossing at grade 60 new street must pass under or over 61 through Chautauqua Assembly 10 through concourse lands, not allowed 8 through Indian lands 9 through public lands 8 through reservation at Niagara, not allowed 8 tunnel 16 to give no preferences in business as common carriers 34 Railroad tracks, individual may lay down, etc 20 Rates of fare 37 Rate of fare of street surface railroads 101 Rate of speed of street surface railroads 98 Real property, acquisition of title to 7 Recommendations of board of R. R. commissioners, when changes rc necessary 1 01 legal effect of 102 where law has been violated , 160 Reduction of fare by legislature 38 Refusal of passenger to pay fare; may be ejected 40 Removal of snow and ice by street surface railroads 98 Reorganization of railroads 70-83 Reorganized railroad companies, liabilities of 83 Repairs, of streets by street surface railroads 98 recommendations of, by R. R. commissioners 161 Report, of receipts by officers of street surface railroads 95 of railroad companies to R. R. commissioners 158 Requisites as to exercise of power of future railroad companies 59 Reservation at Niagara, railroad through not allowed 8 Revocation of consent, etc 59b Riding on platform 53 Right to operate branches by street surface railroads 106 Rights and liabilities as common carriers 48 Roads, leases of 78 Route, change of 13 of railroad 6 alteration of by commissioners 6 commissioners, when appointed 6 hearing on petition of aggrieved owner 6 maps to be made and filed 6 maps showing alterations to be filed 6 notice to owner 6 occupant or owner may apply to court for relief 6 R. R. commissioners may certify as to part of 50a of steam railroad in cities 134, 1 2S abandonment of 136 coinciding with other routes 131 Running of trains on steam railways in cities 138 INDEX. g. SECTION Safeguards, R. R. commissioners may approve additional 50 Safety brake 49 Salaries of It. It. commissioners and employees 169 Sale and reorganization of railroads 70-84 Sale of franchises of street surface railroads at public auction, 93 Sand, use of, on tracks 107 Secretary of R. R. commission 152 Section 24 of Stock Corporations Law not applicable to railroads 23 Sections of law to be printed and posted 141 Shares of stock, certificate of incorporation to specify. 2 Short title 1 Signboards and flagmen at crossings 33 Signals 49 Sleeping cars, fare for 41 Snow, removal of, by street surface railroads 98 Stations, names of , in villages 34 Stock, held by municipal corporation, how represented 75 subscribers to, certificate of incorporation to specify 2 Stockholders, agreement to consolidate to be submitted to 71 Stopping of trains, by steam railways in cities 138 Stoves and furnaces, use of, in cars prohibited 51 Steam railways in cities to print and post certain sections of the law. . 141 Steam surface railroads must avoid street crossings at grade 60-G9 new street must pass under or over 61 Steam railways in streets, avenues and public places, in cities and coun- ties, application for 120 Stock corporation, section 24, application of 23 Streams, railroad may intersect 4 Street must hereafter pass under or over steam road Gl Street surface railroads 90-1 1 1 a abandonment of part of route 103 center-bearing rails prohibited 109 consent of property owners 91 of local authorities 91-02 upon what conditions given 93 construction of road, when other road built 102 contracting corporations to carry for one fare 104 corporate rights saved, etc 106 effect of dissolution 105 extension of route, etc 06 general provisions , 00 motive power 100 new road in cities and counties 120-142 percentage of gross receipts, in villages, etc 03 report of officers as to 95 proceedings when property owners fail to consent 04 protection of employees lll_llln R. R. commissioners may certify part of route of, etc 59a 91 INDEX. Street surface railroads Continued. SECTION rate of fare 101 rate of speed gs repair of streets 9>$ removal of ice and snow ' 9^ right to cross bridge 1 10 sale of franchise at public auction 93 use of tracks of other roads 97 when sand may be used on tracks 107 within what time to be built 99 rights after having crossed bridge for five yean: 110 Streets through which street surface road runs, certificate of incorpora- tion to specify 2 Subscribers to stock, certificate of incorporation to specify 2 Substituted lines in cases of eminent domain 22 Supplemental certificate of incorporation 3 Supreme court, may appoint commissioners, when property owners fail to consent to street surface railroad 96 Supreme court, may compel compliance with recommendations of R. R. commissioners 162 may extend time under requirements of article five 142 Suspension of R. R. commissioners 151 Switches 49 T. Terminus, change of 13 of street surface railroads in other counties 96 Thistles, Canada, to be cut 52 Tickets and checks for connecting steamboats 47 Title of chapter 1 Tools in passenger cars 49 Track, walking along 53 Tracks of other road, use of, by street surface railroad 97 Trains, notice of starting 34 Trains to come to full stop in cities 138 Transportation of persons and property, power of company as to 4 Tunnel, railroad 16 Turnpike, railroad may intersect v 4 Two roads embracing same location 15 u. Unclaimed freight and baggage 46 Use of stoves and furnaces in cars prohibited " 51 Use ef track of other roads by street surface railroads 97 V. Vest.bules, act relating to 111-llla Villages, name of stations in 34 Violation of law, recommendations of R. R. commissioners as to. ...:... 160 92 INDEX. \y SECTION W alking along track .3:} Warning signals 48 Water, supply of, in cars 49 Waters, what shall not be taken by railroads 7 Weight of rail 31 When conductors, etc., may be policemen 58 Winter, certain railroads may cease operation in 55 Witnesses before si. R. commissioners and their fees 164 . 566 of 189O. AN ACT in relation to transportation corporations, excepting rail- roads, constituting chapter forty of the general laws. APPROVED by the Governor June 7, 1890. Passed, three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows : CHAPTER XL OF THE GENERAL LAWS. THE TRANSPORTATION CORPORATIONS LAW. ARTICLB 1.. Ferry corporations ( 1-6). 2. Navigation corporations (& 10-13). 3. Stage-coach corporations ( 20-22). 4. Tramway corporations ( 30-33). 5. Pipe-line corporations ( 40-54). 6. Gas and electric light corporations ( 60-71). 7. Water-works corporations ( 80-85). 8. Telegraph and telephone corporations ( 100-109). 9. Turnpike, plank-road and bridge corporations ( 120-161). 10. Miscellaneous provisions ( 160-163). ARTICLE I. PERRY CORPORATIONS. SBOTION 1. Short title of chapter. 2. Incorporation of ferry corporations. w 3. Payment of capital stock. 4. Powers. 5. Effect of failure to pay in capital stock. 6. Posting schedule of rates. SECTION 1. Short title of chapter. This chapter shall be known as the transportation corporations law. 2. Incorporation of ferry corporations. Three or more per- sons may become a corporation for conducting and managing a ferry, by executing, acknowledging and filing a certificate, stating the name of the corporation, the places from and to which the ferry estab- lished or to be established shaE run ; the terra not exceeding fifty years for which the corporation is to exist, the amount and number of shares of its capital stock ; the number of directors thereof, not less than three nor more than fifteen, and the names of the directors for the first year. 8. Half of capital to be paid in before commencing busi- ness. No ferry corporation shall be authorized to commence busi- 1 ^ .^PORTATION CORPORATIONS LAW. ness until at least one-half its capital shall have been actually paid in, nor until affidavits of such payment, sworn to by a majority of the directors, shall have been filed, in each of the offices in which the cer- tificate of incorporation is required to be filed. 4. Powers. In addition to the powers conferred by the general and stock corporation laws, any such corporation shall have power to take by grant from any authority entitled by the laws of this state to make such grant, or by assignment, the franchise or right to establish and maintain ferries, at the place specified in the certificate of incor- poration, and to hold and exercise such franchise or right and carry on the business appertaining thereto, subject to the rights of the mayor, alderman and commonalty of the city of New York, or any other mu- nicipal corporation, or of the owner or owners of any legally existing ferry, or the vested rights of any other corporation whatever. 5. Effect of failure to pay in capital stock. The capital stock of every such corporation shall all be paid in, one-half thereof within one year and the other half thereof within two years from its incorpora- tion, or such corporation shall be dissolved. 6. Must post schedule of rates. Every corporation operating any ferry in this state, or between this state and aiiy other state, and from or to a city of five hundred thousand inhabitants or over, shall post in a conspicuous and accessible place in each of its ferry- houses, in plain view of the passengers, a schedule plainly printed in the English language, of the rates of ferriage charged thereon and au r thorized by law to be charged for ferriage over such ferry. ARTICLE II. NAVIGATION CORPORATION.* SECTION 10. Formation of corporation. 11. Navigation between additional ports. 12. Payment of capital stock. 13. Ferries unauthorized. 10. Formation of corporation. Seven or more persons may be- come a corporation, for the purpose of building for their own use, equipping, furnishing, fitting, purchasing, chartering, navigating or owning steam, sail or other boats, ships, vessels or other property to be used in any lawful business, trade, commerce or navigation upon the ocean, or any seas, sounds, lakes, rivers, canals or other waterways, and for the carriage, transportation or storing of lading, freight, maiK property or passengers thereon by making, signing, acknowledging ;my law for the filing of the original certificate, in which shall be stated each additional waters or ports upon or between which such corporation desires to navigate vessels, and thereafter such corporation may navi- gate its vessels upon such waters and between such ports, with the like effect as if they had been named in the original certificate. 12. Payment of capital stock. The capital stock of such cor- poration shall be paid in, at least one-half thereof, within one year, and the remainder within two years from its incorporation, or the cor- poration shall be dissolved. Within thirty days after the payment of the last installment, a certificate stating that the whole amount of such capital stock has been' paid in shall be made, signed and sworn to by the president and a majority of the directors of the corporation, and iiled and recorded in the offices where the original certificates of incor- poration were filed. 13. Ferries unauthorized. This article shall not authorize the formation of any ferry corporation to ply between the city of New York and any other point. TRANSPORTATION CORPORATIONS LAW. AETICLE IIL STAGE COACH CORPORATIONS. SECTION 20. Incorporation. 21. Alteration or extension of route. 22. Powers. 23. Existing routes and extensions. 20. Incorporation. Five, or more persons, may become a corporation for the purpose of establishing, maintaining and operating any stage" or omnibus route or routes for the public use iii the conveyance of persons and property else- where than in the city^ of New York, or any stage route or routes already estab- lished for a like public use, by making, signing, acknowledging and filing a cer- tificate which shall state the name of the corporation, the number of years it is to continue, the route or routes upon which it is intended to run as near as practica- ble, the number of the directors thereof, not less than three nor more than five, the names of the directors for the first year, the amount of its capital stock, the place of residence of each subscriber thereto, and the number of shares of stock he agrees to take in such corporation. 21. Alteration or extension of ronte. The directors may, by a vote of two thirds of their number, at any time alter or extend the route or routes desig- nated in the certificate of incorporation, upon making, acknowledging and filing a certificate to that effect, in the offices where the original certificates of incorpora- tion were filed. ' 22. Powers. In addition to the powers conferred by the general and stock corporation laws, every such corporation shall have power: 1. To take and convey persons and property in stages and omnibuses, and to provide and run the necessary stages and omnibuses upon their route or routes for the public use and to receive compensation therefor. 2. To erect and maintain all necessary and convenient buildings, fixtures and machinery for the use and accommodation of their passengers and business. 23. Existing routes and extensions. Any corporation incorporated under any law of this state heretofore enacted which owns and operates a lawfully estab- lished stage route which has been continuously operated by such company or its predecessors in title to such route for five years last past in any city of the first class, is hereby authorized and empowered to extend its existing routes at any time or times and to operate the same as extended with stages and omnibuses propelled by electricity or any other motive power, in and upon any streets and highways of such city, without further or other authority, proceeding, or consent required under any act, general, public, private or local; provided, however, that such ex- tensions shall not become valid until they shall have been first approved by the tate board of railroad commissioners, who, on giving their approval, shall make a certificate of such extension or extensions of route as approved, which certificate shall be filed in the office of the secretary of state, and in the office of the clerk of the county in which such extension is located. Such company, on filing in said offices an acceptance of the extensions specified in such certificate and on operating such extensions, shall have the right to charge a fare not exceeding ten cents per passenger for a continuous ride over the whole or any part of the routes owned or operated by it, and shall pay a license fee to the city in which it oper- ates equal to the charge now in force for licensing similar stages and omnibuses, and shall also pay to the comptroller or other chief fiscal officer of said city five per centum per annum of its gross receipts from the operation of said routes. [New.] Added by chap. 657 of 1900. In effect April 25, 1900. ARTICLE IV. TRAMWAY CORPORATIONS. SECTION 30. Incorporation. 31. Powers. 82. Condemnation of real property. 33. Crossings. 30. Incorporation, Thirteen or more persons may become a corporation for constructing, maintaining and operating an elevated 4 TRANSPORTATION CORPORATIONS LAW. tramway, constructed of poles, piers, wires, rods, ropes, bars or chains, for the transportation of freight in suspended buckets, cars or other receptacle*, for hire, by making, signing, acknowledging and filing a certificate stating the name of the corporation, the number of years it is to continue, the places from and to which such tramway ia to be constructed, maintained and operated, its length as near as may be, the name of each county through or in which it is made or intended to be made, the amount of its capital stock and the number of shares into which it is to be divided, the number of the directors thereof, not less than three, the names and places of residence of the directors for the first year, the place of residence of each subscriber thereto and the number of shares he agrees to take in such corporation. 31. Powers. Every such corporation, in addition to the powers conferred by the general and stock corporation laws, shall have power : 1. To cause such examination and surveys for its proposed tram- way, to be made as may be necessary to the selection of the most advantageous route, and for such purpose by its oificers and servants, to enter upon the lands or waters of any person, but subject to re- sponsibility for all damages done thereto. 2. To lay out its tramway and to construct the same as hereby provided. 3. To erect and maintain all necessary and convenient buildings, stations, fixtures and machinery for the accommodation and trans- action of its business. 32. May acquire land by condemnation. In case any such corporation is unable to agree for the purchase, use or lease of any real property required for the purposes of its incorporation, it shall have the right to acquire title to the same by condemnation. 33. Crossings. Whenever any tramway, constructed- by any such corporation, shall cross a railroad, highway, turnpike, plank- road or canal, such tramway shall be so constructed as not to interfere with the free use of such railroad, highway, turnpike, plank-road or canal for the purposes for which they were intended. ARTICLE Y. PIPE LINE CORPORATIONS. SBOTION 40. Incorporation. 41. Location of line. 42. Condemnation of real property. 43. Railroad, turnpike, plank-road and highway crossings. 44. Crossings of canals, rivers and creeks. 45. Consent of local authorities. 46. Construction through villages and cities. 5 TRANSPORTATION CORPORATIONS LAW. 47. Over Indian reservations. 48. Over state lands. 49. Additional powers. 50. Use of line to be public ; storage ; liable as common carriers ; rate* and charges. 51. Receipts for property ; cancellation of vouchers. 52. Monthly statements. 53. Fences, farm crossings and use of line not inclosed. 54. Taxation of property. 40. Incorporation. Twelve or mor.e persons may become a corporation for constructing and operating for public use, except in the city of New York, lines of pipe for conveying or transporting therein petroleum, gas, liquids or any products or property, or for maintaining and operating any line of pipe already constructed and owned by any corporation, person or persons, except in such city, for the public use, by making, signing, acknowledging and filing a certificate stating the name of the corporation, the number of years it is to continue, the places from and to which it is to be constructed or maintained and operated, its length as near as may be, the name of each county through or into which it is to be constructed; the amount of its capital stock, which shall not be less than fifteen hundred dol- lars for every mile of pipe constructed or proposed to be constructed, and the number of shares of which it shall consist ; the number of directors not less than seven, and the names and places of residence of the directors for the first year, and the place of residence of each sub- ecriber and the number of shares he agrees to take in such corporation, which must in the aggregate equal ten hundred and fifty dollars for every mile of pipe constructed or proposed to be constructed, and twenty-five per cent of which must be paid in cash. Such certificate shall have indorsed thereon or appended thereto and as a part thereof, an affidavit made by at least three of the directors named therein that at least ten hundred and fifty dollars of stock for every mile of line proposed to be constructed or maintained and operated has been in good faith subscribed, and twenty-five per cent paid in mojiey thereon, and that it is intended in good faith to construct or to maintain and operate the line of pipe mentioned in such certificate, and that such corporation was not projected or formed with the intent or for the pur pose of injuring any person or corporation, nor for the purpose of sell- ing or conveying its franchise to any person or corporation, nor for any fraudulent purpose. 41. Location of line. Every such corporation shall before com- mencing the construction of its pipe line in any county, or any 'pro- ceeding for the condemnation of real property, plainly and distinctly mark and designate the line adopted and located by them by a lino of stakes consecutively numbered and equally distant, and not more than twenty rods from each other, so that each line can be definitely 6 TRANSPORTATION CORPORATIONS LAW. known and ascertained in all places, and make a map and survey of the route so located and staked out, and shall indicate thereon plainly the points where such route crosses each parcel of land to which they have not acquired title by agreement, and shall cause such map and survey to be certified by the president and engineer, and filed in the office of the clerk of the county into or through which the line so located and mapped passes, and shall give to the owner or occupant, if he is known or can be ascertained, of every parcel of land through which such route passes, the title to which has not been acquired by pur- chase, written notice of the filing of such map and survey, stating that such route passes over or across such owner's or occupant's lands, and that the route thereof is indicated thereon by such line of stakes. Any occupant or owner of such lands feeling aggrieved by the proposed location, may, within fifteen days after the service of such notice, give ten days' written notice to the corporation, by service upon the presi- dent, engineer, ar any director thereof, and to the owner or occupant of any lands to be affected by the alteration to be proposed by him, of the time and place of an application to be made by him to a special term of the supreme court in the judicial district in which the lands are situated for the appointment of commissioners to relocate such line. If upon the hearing the court shall consider that sufficient cause exists therefor, it shall appoint three disinterested persons commissioners to examine the route located and the proposed alteration thereof, and direct the mode of proceeding, who shall report to the court the facts relating thereto and their opinion as to the proposed alteration, and what, if any, alteration should be made in such line, and the court shall thereupon make such order as it shall deem proper in relation to such alteration, and determine the location of such line, and fix and adjust the costs, fees and charges of the commissioners, and the costs and charges of the proceedings, and direct by which party the same shall be paid, and may enforce payment thereof by proceedings as for a contempt of court, for refusal to pay costs directed to be paid by an order of the court, and such order shall be final as to the location of the line upon the lands embraced therein. Such corporation shall not commence the work of constructing or laying its line of pipe, or insti- tute proceedings for the condemnation of real property, in any county, until after the expiration of fifteen days from the service by it of the notice herein required, nor until all applications for a relocation of its line in such county if any are made, have been finally determined. 42. Condemnation of real property. In case such corporation is unable to agree for the purchase of any real estate required for the purposes of its incorporation, and its line of pipe in the county in which such real estate is situated has been finally located, it shall have TRANSPORTATION CORPORATIONS LAW. the right to acquire title thereto by condemnation, but such corpora- tion shall not locate or construct any line of pipe through or under any building, dooryard, lawn, garden or orchard, except by the con- sent of the owner thereof in writing duly acknowledged, nor through any cemetery or burial ground, nor within one hundred feet of any building, except where such line is authorized by public officers to be laid across or upon any public highway, or where the same is laid across or upon any turnpike or plankroad. No pipes shall be laid for the purpose of carrying petroleum, gas or other products or prop- erty through or under any of the streets in the cities of this state, unless such corporation shall first obtain the consent of a majority of the property owners on the streets which may be selected for the lay- ing of pipes, and such pipe-line shall be located with all reasonable care and prudence so as to avoid danger from the bursting of the pipes. 43. Railroad, turnpike, plankroad and highway cross- ings. Whenever any line of pipe of any such corporation shall nec- essarily cross any railroad, highway, turnpike or plankroad, such line or pipe shall be made to cross under such railroad, highway, turnpike or plankroad and with the least injury thereto practicaWe, and unless the right to cross the same shall be acquired by agreement, compensa- tion shall be ascertained and made to the owners thereof, or to the public in case of highways, in the manner prescribed in the condem- tion law, but no exclusive title or use shall be so acquired as against any railroad, turnpike or plankroad corporation, nor as against the rights of the people of this state in any public highway, but the rights acquired shall be a common use of the lands in such manner as to be of the least practical injury to such railroad, turnpike or plankroad, consistent with the use thereof by such pipe-line corporation, nor shall any such corporation take or use any lands, fixtures or erections of any railroad corporation, or have the right to acquire by condemnation the title or use, or right to run along or upon the lands of any such cor- poration, except for the purpose of directly crossing the same when necessary. 44. Construction across and along canals, rivers and creeks. No pipe line shall be constructed upon or across any of the canals of this state, except by the consent of and in the manner and upon the terms prescribed by the superintendent of public works, unless constructed upon a fixed bridge across such canal, and with the consent of the person for whose benefit such bridge is constructed and maintained, or ivpon such a bridge over the canal, at the crossing of & public highway, or street with the consent of the public officers hav- ing the supervision thereof, or of the municipal authorities of any 8 TRANSPORTATION CORPORATIONS LAW. village or city within whose limits such bridge may be, nor shall the pipes of any such corporation be laid through or along the banks of any of the canals of this state, nor through or under any of its rivers or creeks, unless such pipes shall be encased so as to prevent leakage, in such manner as shall be approved by the superintendent of public works. 45. Consent of local authorities. No pipe line shall be con- structed across, along or upon any public highway without the consent of the commissioners of highways of the town in which such highway is located, upon such terms as may be agreed upon with such commis- sioners. If such consent or the consent of the commissioners or municipal authorities required by the preceding section can not be obtained, application may be made to the general term of the supreme court of the department in which such highway or bridge is situated for an order permitting the corporation to construct its line across, along or upon such highway, or across or upon such bridge. The application shall be by duly verified petition and notice which shall be terved upon the commissioners of highways of the town in which the highway is situated, or the municipal authorities of t?ie village or city where such bridge is located, according to t>ie practice or order of the court, or an order to show cause, and the court upon the hearing of the application may grant an order permitting the line to be so constructed in such manner and upon such terms as it may direct. 46. Construction through villages and cities. No pipe line uhall be constructed into or through any incorporated village or city in this state, unless authorized by a resolution prescribing the route, 'manner of construction and terms upon which granted, adopted at a regular meeting of the board of trustees of the village or the common council of the city by a two-thirds vote of such board or council, but such resolution shall not affect any private right. No pavement shall be removed in any city under the provisions of this article, unless done under the direction of the common council, nor until such cor- poration shall give a bond in such sum as the common council may require for the replacing of any pavements which shall have been removed. In case any pavement shall have been removed and not properly relaid, the common council may bring suit in any court of record, for the cost of relaying such pavement against any such cor- poration. No gas-houses shall be erected in any city tinder the pro- visions of this article, for supplying gas to the inhabitants, unless consent is first given by the corporate authorities of the city. 47. Over Indian reservations. Such corporation may contract with the chiefs of any nation of Indians over whose lands it may be 9 TRANSPORTATION CORPORATIONS LAW. necessary to construct their pipe line for the right to construct such pipe line upon such lands, but no such contract shall vest in the cor- poration the fee of such lands, nor the right to occupy the same for any purpose other than for the construction, operation and mainte- nance of such pipe line, nor shall such contract be valid or effectual until the same has been ratified by the county court of the county in which the lands are situated. 48. Over state lands. The commissioners of ihe land office shall have power to grant to any pipe line corporation any lands belonging to the people of this state which may be required for tho purposes of its incorporation on such terms as may be agreed on by them or such corporation may acquire title thereto by condemnation, and if any lands owned by any county, city or town as required by such corporation for such purposes, the county, city or town officers having charge of such lands may grant them to such corporation upon such terms and for such compensation as may be agreed upon. 49. Additional powers. Rvery corporation formed under this article shall in addition to the powers conferred by the- general and stock corporation law h re p^war : 1. To cause such examination and surveys of its proposed line of pipe to be made as may be necessary to the selection of the most advantageous route, and for such purpose by its officers, agents or ser- vants may enter upon the lands or waters of any person, upon, through or across which such corporation can construct its line of pipe, under the provisions of this article, subject however to liability for all actual damage which shall be done thereto. 2. To take and ho'.d s .ch voluntary grants of real estate and other property, as shall be mad. to it to aid in the construction, mainten > ance, operation and ace: mraodation of its pipe line. 3. To lay out its pipe "'--.e route not exceeding twelve feet in width, but at the terminations of such line and at all receiving and discharg- ing points and at all places where machinery may properly or must necessarily be set up for the operation of such pipe line it may tak'i jmch additional width, and for such length as may be necessary. 4. To take and convey through pipes any property, substance or product capable of transportation therein by any force, power or me- chanical agency, and to erect and maintain all necessary and con- venient buildings, stations, fixtures and machinery for the purposes of its incorporation. 5. To regulate the time and manner in which property shall bn transported over its pipe lines, and the compensation to be paid there- for, but such compensation shall not exceed the sum or be above th^ 1 10 TRANSPORTATION CORPORATIONS LAW. rate of twenty-five cents per one hundred miles for the transportation of forty-two gallons of any product transported on lines of one hun- dred miles in length or over, which shall be reckoned and adjusted upon the quantity or number of gallons delivered by such corporation at the point to which it shall have undertaken to deliver the same. 50. Use of line to- be public ; storage ; liable as common carriers ; rates and charges. The pipe lines of every such cor- poration shall be open for transportation to the public use, and all persons desiring to transport products through such pipe line shall have the absolute right upon equal terms to such transportation in the order of application therefor, on complying with the general require- ments of such corporation, as to delivery for and payment of such transportation, but no application for such transportation shall be valid beyond or for a greater quantity of products than the applicant shall then own and have ready for delivery for transportation to such corporation, and every such corporation shall provide suitable and necessary receptacles for receiving all such products for trans- portation, and for storage at the place of delivei-y until the same can reasonably be moved by the consignee, and shall be liable as common carriers therefor from the time the same is delivered for transportation until a reasonable time after the same has been trans- ported to the place of consignment and ready for delivery to the consignee, which time shall be fixed by general regulation by the corporation, and shall not be less than two days from and after the same shall be ready for delivery and notice thereof given to such consignee, and all rates and charges of every description, for or on ac- count of or in any manner connected with the transportation of any products, shall be fixed by such corporation by general rules and regu- lations, which shall be applicable to all parties who shall transport any products through such pipe line, or deliver or contract to deliver products for transportation and shall be written or printed and ex- posed to public view and at all times open to public examination. 51. Receipts for property ; cancellation of vouchers ; de- livery of property. No receipt, certificate or order of any kind shall be made, accepted or issued by any pipe line corporation for any commodity unless the commodity represented by them is actually in possession of the corporation at the time of making, issuing or accept- ance thereof. Whenever .any such corporation shall have parted with the possession of any commodity and received therefor any order, voucher, receipt or certificate, such order, voucher, receipt or certifi- cate shall not be issued or used again, but shall be canceled with the word " canceled " stamped or printed legibly across the face thereof, and such canceled order, voucher, receipt or certificate shall 11 TRANSPORTATION CORPORATIONS LAW. be filed and preserved by such corporation and a record of the same kept by the secretary thereof. No petroleum or other commodity received for transportation by such corporation shall be delivered to any person without the presentation and surrender of all vouchers, receipts, orders or certificates that have been issued or accepted for the same. 52. Monthly statements. Every pipe line corporation shall make monthly a specific statement showing the amount of all com- modities received, the amount delivered during the month, and the stock on hand on the last day of each month of the year, and how much of such stock is represented by outstanding certificates, vouch- ers, receipts or orders, and how much in credit balances on the books of the corporation. Such statement shall be made on or before the tenth day of the succeeding month and verified by the oath of the president and secretary that it is in all respects true and correct, and shall be filed within three days thereafter in the county clerk's office in the county where the principal office of the corporation is located, and a true copy of the same posted in a conspicuous place in its prin- cipal office for at least thirty days thereafter. 53. Fences ; farm crossings and use of line not inclosed. It shall not be necessary for any such corporation to fence the lands acquired by them for the purposes of its incorporation. But, if not enclosed by a substantial fence, the owner of the adjoining lands from whom such lands were obtained, his heirs or assigns, may occupy and use such lands in any manner not injurious to the interests of the corporation and shall not be liable therefor, or for any trespass upon any such lands except for willful or negligent injuries to the pipes, fixtures, machinery or personal property of the corporation. If the corporation shall keep such lands inclosed it shall construct and pro- vide all suitable and necessary crossings with gates for the use and convenience of any owners of lands adjoining the portion of its lands so inclosed, and no claim shall be made by it against any owner of adjoining lands to make or contribute to the making or maintaining of any division fence between such adjoining lands and its lands, and if it shall neglect to keek* and maintain substantial fences along its lands the owners of adjoining lands may construct and maintain all farm or division fences, and all line fences crossed by such pipe line in the same manner as though it had not acquired such lands for such pipe line, and it shall be liable for all injuries to such fences caused or done by any of its officers or agents, or any persons acting in their or its behalf, or by any laborer in its or their employ or in the employ of any of its contractors. So in the original. 12 TRANSPORTATION CORPORATIONS LAW. 54. Taxation of property. The real estate and personal prop- erty belonging to any pipe line corporation in this state, shall be as- sessed and taxed in the several towns, villages and cities in the same manner as the real estate and personal property of railroad corpora- tions are assessed and taxed, and such corporation may pay such taxes or commute therefor in the same manner as railroad corporations. ARTICLE VI. QA8 AND ELECTRIC LIGHT CORPORATIONS. SBCTION 60. Incorporation. 61. Powers. 62. Appointment of inspectors of gas meters. 63. Deputy inspectors. 64. Inspection of gas meters. 65 Gaa or electric light must be supplied on application. 66. Deposit of money may be required. 67. Entry of buildings to *meters or lights. 68. Refusal or neglect to pay rent. 69. No rent for meters to be charged. 70. Price of gas. SECTION 60. Incorporation. Three or more persons may become a corporation for manufacturing and supplying gas for lighting the "streets and public and private buildings of cities, villages and towns in this state, or for manufacturing and using electricity for pro- ducing light, heat or power, and in lighting streets, avenues, public parks and places, and public and private buildings of cities, villages and towns within this state, or for two or more of such purposes, by making, signing, acknowledging and filing a certificate stating the name of the corporation, its objects, 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 not less than three nor more than thirteen, the names and places of resi- dence of the directors for the first year, and the names of the towns, villages, cities and counties in which the operations of the corporation are to be carried on, and thereupon the persons who shall have signed the same, their associates and successors shall be a corporation by the name stated in the certificate. Am'd by chap. 575 of 1900. In effect April 23, 1900. 61. Powers. Every such corporation shall have the following additional powers : 1. If incorporated for the purpose of supplying gas for light, to manu- facture gas, and to acquire by purchase or otherwise natural gas and to sell and furnish such quantities of gas as may be required in each city, town and village named in its certificate of incorporation, for lighting the streets, and public or private buildings or for other purposes; and to lay conductors for conducting gas through the streets, lanes, al" squares and highways, in each such city, village and town, with the consent of the municipal authorities thereof, and under such reasonable regulations as they may prescribe; and such municipal authorities shall have power to exempt any such corporation from taxation on their *So in original. 13 TRANSPORTATION CORPORATION LAW. personal property for a period not exceeding three years from the frganization of the corporation. Any corporation authorized under any general or special law of this state to manufacture and supply gas shall have the like powers and privileges. Subd. 1 amended by ch. 575 of 1900. In effect April 23, 1900. Subd. 1 amended by ch. 596 of 1902. In effect April 15, 1902. 8. If incorporated for the purpose of using electricity for light, heat or power, to carry on the business of lighting by electricity or using it for heat or power iu cities, towns and villages within this state, and the streets, avenues, public parks and places thereof, and public and private buildings therein; and for the purposes of such business to generate and supply electricity; and to make, sell or lease all machines, instruments, apparatus, and other equipments the: 3for, and to lay, erect and constrict suitable wires or other conductors, with the necessary poles, pipes or other fixtures in, on, over and under the streets, avenues, public parks and places of such cities, towns or villages, for conducting and distributing electricity, with the consent of the municipal authorities thereof, and in such manner and under such reasonable regulations, as they may prescribe. 3. Any two or more corporations organized under this article or under any. general or special law of the state for the purpose of carrying on any business which a corporation organized under this article might carry on, may consolidate such corporations into a single corporation by complying with the provisions of the business corporations law relating to the consolidation of business corporations. 4. Any corporation organized under this article or under any general or special law of this state for the purpose of using electricity for light, heat or power in cities, other than of the first class, towns or villages within this state, may have and acquire the following additional powers, to wit: the power of supplying steam to consume rs from a central station or stations through pipes laid in the public streets of the ci;ies, towns and villages within this state, and for that purpose to lay, construct and maintain suitable pipes and conduits or other fixtures in, ou and under the streets, avenues, public parks and places of such cities, towns or villages, with the consent of the municipal authorities thereof, and under such reasonable regulations as they may prescribe. For the purpose of acquiring the powers above specified any such corporation may make, sign, acknowledge and file in in the same manner as an original or amended certificate of incorpora- tion, a certificate stating that such corporation desires and intends to exercise the powers hereinabove specified. Upon the making, signing acknowledging and filing such certificate, such corporation shall have and acquire for the purposes specified in such certificate all the rights, privileges and powers, and be subject to all the restrictions of district steam corporations, specified in sections thirteen, fourteen and fifteen of the business corporations law being chapter six hundred and ninety-one of the laws of eighteen hundred and ninety-two. Added by ch. 565 of 1899. 62. Inspector of gas meters. The governor shall nominate and by and with the consent of the senate appoint an inspector of gas meters, who shall have an office in The City of New York, whose duty it shall be, when required, to inspect, examine, prove and ascertain the accuracy of any and all gas meters used or intended to be used for measuring or ascertaining the quantity of illuminating or fuel gas furnished by any gas corporation in this state including a corporation engaged in supplying natural gas to consumers, to or for the use of any person or persons, and. when found to be or made correct, to seal, stamp or mark all such meters, and each of them, with some suitable device, which device shall be recorded in the office of the secretary of state. Such inspector shall hold his office for the term of five years and until the appointment of his successor, but may be removed by the governor for sufficient cause. He shall receive an annual salary of five thousand dollars, to be paid in the first instance out of the state treasury on the warrant of the comp troller, which shall be charged to and paid into the state treasury by 14 TRANSPORTATION CORPORATION LAW. the several gas corporations in this state, in amounta proportionate to the amount of the capital stock of such corporations respectively, to be ascertained and assessed by the comptroller of the state. If any such corporation shall refuse or neglect to pay into the state treasury the amount or portion of such salary required of them re- spectively, for the space of thirty days after written notice given it by the comptroller to make such payment, then the comptroller may maintain an action, in his name of office, against any such delinquent corporation for its portion or amount of such salary, with interest thereon at the rate of ten per centum per annum from the time when such notice was given and the costs of the action. [Ara'd, ch. 364 of 1898.] 63. Deputy inspectors. The inspectors of gas meters "shall appoint four deputy inspectors of gas meters to reside in the citv of Brooklyn, Albany, Buffalo and Jamestown, respectively, to hold during his pleasure, and who shall in their respective places of resi- dence discharge the same duties as are required of the inspector. Such deputies shall each receive an annual salary of fifteen hundred dollars to be paid in the same manner as the salary of the inspector. [Am'd, ch 364 of 1898]. 6 i. Inspection of gas meters. No corporation or person shall furnish or put in use any gas meter, which shall not have been iu- bpeCutsd, proved and sealed by the inspector, except during such time us the office of inspector may be vacant, or such inspector after request made, shall refuse or neglect to prove and seal the meters furnished for that purpose, and every gas-light corporation shall provide and keep in and upon their premises a suitable and proper apparatus, to be ap- proved and sealed by the inspector of meters, for testing and proving the accuracy of the gas meters furnished for use by it, and by which apparatus every meter may and shall be tested, on the written request of the consumer, to whom the same shall be furnished, and in his pres- ence if he desire it. If any such meter, on being 'so tested, shall be found defective or incorrect to the prejudice or injury of the consumer, the necessary removal inspection, correction and replacing of such meter shall be without expense to the consumer, but in all other cases he shall pay the reasonable expenses of such removal, inspection and replacing; and in case any consumer shall not be satisfied with such inspection of the meter furnished to him, and shall give to the corpo- ration written notice to that effect, he may have such meter reinspected by the state inspector,- if he require it, upon the same terms and con- ditions as herein provided for the original inspection thereof. 65. Gas and electric light must be supplied on applica- tion. Upon the application, in writing, of the owner or occupant of 15 TRANSPORTATION CORPORATIONS LAW. any building or premises within one hundred feet of any main laid down by any gas-light corporation, or the wires of any electric-light corporation, and payment by him of all money due from him to the corporation, the corporation shall supply gas or electric light as may be required for lighting such building or premises, notwithstanding there be rent or compensation in arrear, for gas or electric light sup- plied, or for meter, wire, pipe or fittings, furnished to a former occu- pant thereof, unless such owner or occupant shall have undertaken or agreed with the former occupant to pay or to exonerate him from the payment of such arrears, and shall refuse or neglect to pay the same ; and if for the space of ten days after such application, and the de- posit of a reasonable sum as provided in the next section, if required, the corporation shall refuse or neglect to supply gas or electric light as required, such corporation shall forfeit and pay to the applicant the sum of ten dollars, and the further sum of five dollars for every day thereafter during which such refusal or neglect shall continue ; provided that no such corporation shall be required to lay service pipes or wires for the purpose of supplying gas or electric light to any appli- cant where the ground in which such pipe or wire is required to be laid shall be frozen, or shall otherwise present serious obstacles to lay- ing the same ; nor unless the applicant, if required, s.hall deposit in advance with the corporation a sum of money sufficient to pay the cost of his portion of the pipe or wire required to be laid, and the expense of laying such portion. 66. Deposit of money may be required. Every gas-light and electric light corporation may require every person to which such cor- poration shall supply gas or electric light for lighting any building, room or premises to deposit with such corporation a reasonable turn of money according to the number and size of lights used or required, or proposed to be used for two calendar months, by such person, and the quantity of gas and electric light necessary to supply the same as security for the payment of the gas and electric light rent or compen- sation for gas consumed, or rent of pipe or wire and fixtures, to become due to the corporation, but every corporation shall allow and pay to every such depositor legal interest on the sum deposited for the time his deposit shall remain with the corporation. 67. Buildings may be entered for the examination of meters, lights, and-so-forth. Any officer or other agent of any gas-light or electric light corporation, for that purpose duly appointed and authorized by the corporation, may, at all reasonable times, upon exhibiting a written authority, signed by the president and secretary of the corporation, enter any dwelling, store, building, room or place lighted with gas or electric light supplied by such corporation, for the 16 TRANSPORTATION CORPORATIONS LAW. purpose of inspecting and examining the meters, pipes, fittings, wires and works for supplying or regulating the supply of gas or electric light and of ascertaining the quantity of gas or electric light consumed or supplied, and if any person shall, at any time, directly or indirectly, prevent or hinder any such officer or agent from so entering any such premises, or from making such inspection or examination at any reasonable time, he shall, for every such offense, forfeit to the corpora- tion twenty-five dollars. 68. Refusal or neglect to pay rent. If any person supplied with gas or electric light by any such corporation shall neglect or re- fuse to pay the rent or remuneration due for the same or for the wires, pipes or fittings let by the corporation, for supplying or using sach gas or electric light or for ascertaining the quantity consumed or u >ed as required by his contract with the corporation, or shall refuse or neglect, after being required so to do, to make the deposit required, sii;h corporation may prevent thg gas or electric light from entering th* premises of such person ; and their officers, agents or workmen may enter into or upon any such premises between the hours of eight o'clock in the forenoon and six o'clock in the afternoon, and separate and carry away any meter, pipe, fittings, wires or other property of the corporation, and may disconnect any meter, pipe, fittings, wires or other works whether the property of the corporation or not, from th mains, pipes or wires of the corporation. 69. No rent for meters to be charged. No gas-light corpora- tion in this state, shall charge or collect rent on its gas meters, either in a direct or indirect manner, and any person, party or corporation violating this provision shall be liable to a penalty of fifty dollars for each offense, to be sued for and recovered ia the corporate name of the city or village where the violation occurs, in any court having juris- diction, and when collected to be paid into the treasury of such city or village and to constitute a part of the contingent or general fund thereof. 70. Price of gas. In any city in this state having a population of eight hundred thousand or over, no corporation or person shall charge for illuminating gas a sum to exceed one dollar and twenty-five cents per thousand feet, and such gas shall have an illuminating power of not less than twenty sperm candles, of six to the pound, and burning at the rate of one hundred and twenty grains of spermaceti per hour, tested at a distance of not less than one mile from the place of manu- facture, by a burner consuming five cubic feet of gas per hour, and shall comply with the standard of purity now or hereafter established by law ; but in any district or ward of any city containing over one 17 TRANSPORTATION CORPORATIONS LAW. million inhabitants, which district or ward is separated from the main portion thereof by a stream or other natural boundary, any gas-light corporation may charge a price not to exceed one dollar and sixty cents per thousand cubic feet, but such corporation shall not charge a greater price in the city where its main works shall be situated than in such district or ward. ARTICLE VII. WATER-WORKS CORPORATIONS. SECTION 80. Incorporation. 81. Must supply water ; village trustees may contract for same ; tay therefor. 82. Powers. 83. Survey and map. 84. Condemnation of real property. 85. Corporation may contract with other towns or villages ; amended certificate. 80. Incorporation. Seven or more persons may become a cor- poration for the purpose of supplying water to any of the cities, towns or villages and the inhabitants thereof, in this state, by exe- cuting, acknowledging and filing a certificate stating the name of the corporation, the amount of its capital stock, the number of shares into which it is to be divided, the location of its principal office, the number of its directors not less than seven, the names and places oi residence of the directors for the first year, the name of the cities, towns and villages which it is proposed to supply with water ; that the permit of the authorities of such cities, towns and villages herein required has been granted ; the post-office address of each subscriber and the number of shares he agrees to take in such corporation, the aggregate of which shall be at least one tenth of the capital stock, and ten per centum of which shall be paid in cash to the directors. At the time of filing there shall be annexed to the certificate and as a part thereof, a permit, signed and acknowledged by a majority of the board of trustees of the village, in case an incorporated village is to be sup- plied with water, and in case a town, or any part thereof, not within an incorporated village, is to be so supplied, by the supervisor, justice of the peace, town clerk and highway commissioners thereof, or a majority of them, and in case a city is to be supplied with water, by the board of water commissioners of said city, or by such other board or set of officials as perform the duties of water commissioners and have charge of the water supply for saH city, authorizing the formation of such corporation for the purpose of supplying such city, village or town with water, and an affidavit of at least three of the directors that the amount of capital stock herein required has been subscribed and paid in cash. This section was amended by chap. 617 of 1892. 81. Must supply water ; contracts with municipalities. Every such cor- poration shall supply the authorities or any of the inhabitants of any city, town or village through which the conduits or mains of such corporation may pass, or wherein such corporations may have organized, with pure and whole- 18 TRANSPORTATION CORPORATION LAW. some water at reasonable rates and cost, and the board of trustees of any in- corporated village and the water commissioners or other board or officials per- forming the duties of water commissioners, and having charge of the water supplies of any city of this state, shall have the power to contract in the name and behalf of the municipal corporation of which they are officers, for the term of one year or more for the delivery by such company to the village or city, of water through hydrants or otherwise, for the extinguishment of firus and for sanitary and other public purposes ; and the amount of such contract agreed to be paid shall be nnually raised as a part of the expenses of such village or city, and shall be levied, assess. < I and collected in the same manner as other expenses of the village or city are raise'd.and when collected shall be kept separate from other funds of the village or citj , and be paid over to such corpo- ration by such trustees or city officials, according to the terms and conditions of any such contract ; and any such contract entered into by the board of trustees of any village, or by water commissioners or other board performing the duties of water commissioners and having charge of the water supply of any city, shall be valid and binding upon such village or city, but no such contract shall be made for a longer period than ten years nor for a sum ex- ceeding in the aggregate, two and one-half mills for every dollar of the taxable property of such village or city, per annum, except upon a petition of a ma- jority of the taxable inhabitants of any such village or city, or portion then if, which it is proposed to supply with pure and wholesome water, unless a res- olution authorizing the same has been submitted to a vote of the electors of the village or city, in the manner provided by the village law or city char- ter, and approved by a majority of the voters entitled to vote and voting on such question at any annual election or special election duly called ; and any board of trustees or board of water commissioners or other city ofiicia!s,whea so authorized, may make such contract for a term not exceeding thirty years, and tlie amount of such contract shall be paid in semi-annual installments. The town board of any town may establish a water supply district in such town outside of a city or incorporated village therein, by filing a certificate describing the bounds thereof, in the office of the town clerk ; an.i may con- tract in the name of the town for, the delivery, by a corporation, subject to the provisions of this article, of a supply of water for fire, sanitary or other public purposes, to such districts, and the whole town shall be bound by such contract, but the rental or expense thereof shall annually, in the same man- ner as other expenses of the town are raised, be assessed, levied upon and col- lected only from the taxable property within such water supply district. Such money, when collected, shall be kept as a separWe fund and be paid over to such corporation by the supervisor of the town, according to the terms and conditions of any such contract. No such contract shall be made for a Ion-- r period than five years, nor for an annual expense exceeding three mills upon each dollar of the taxable property within such water supply dis- trict. Anvd by ch. 678 of 1896. In effect May 15, 1896. 82. Powers. Every such corporation shall have the following additional powers : 1. To lay and maintain their pipes and hydrants for delivering and distributing water in any street, highway or public place of any city, town or village in which it has obtained tne permit required by section eighty of this article. 2. To lay their water pipes in any streets or avenues or public places of an adjoining city, town or village, to the city, town or village where such permit has been obtained, provided that such right in an adjoining city or village having a population of more than twelev thousand inhabitants, shall be subject to the permission of the local authorities thereof and upon such conditions as they may prescribe. Am'd by ch. 210 of 1905. In effect April 11, 1905. Subdiv. 2 arn'd by ch. 455 of 1906. 3. To cause such examinations and surveys for its proposed water- works to be made as may be necessary to determine the proper location thereof, and for such purpose by its officers, agents or servants, to enter upon any lands or waters in the city, town or village where organized, or in any adjoining city, town or village for the purpose of making such examinations or surveys, subject to liability for all damages done, v Am'd by chap. 617, of 1892. F 83. Survey and map.- Before entering upon, taking or using any land, for the purposes of its incorporation such corporation shall cause a survey and map to be made of the lands intended to be taken 19 TRANSPORTATION CORPORATIONS LAW. or entered upon, by and on which the land of each owner or occupant shall be designated, which map shall be signed by the president and secretary, and iiled in office of the county clerk of the county in which such lands are situated. 84. Condemnation of real property. Any corporation organ- ized under this article, shall have the right to acquire real estate, or any interest therein necessary for the purposes of its incorporation, and the right to lay, relay, repair and maintain conduits and water pipes with connections and fixtures, in, through or over the lands of others ; the right to intercept and divert the flow of waters from the lands of riparian owners, and from persons owning or in- terested in any waters, and the right to prevent the flow of drain- age of noxious or impure matters from the lands of others into its reservoirs or sources of supply. If any such corporation, which has made a contract with any city, town or village or with any of the inhabitants thereof for the supply of pure and wholesome water as authorized by section eighty-one of this article, shall be unable to agree upon the terms of purchase of any such property or rights, it may acquire the same by condemnation. But no such corporation shall have power to take or use w r ater from any of the canals of this state, or any canal reservoirs as feeders, or any streams which have been taken by the state for the purpose of supplying the canals with water. Am'd by chap. 230 of 1894. Took effect March 31, 1894. 85. Corporation may contract with other cities, towns or villages; amended certificate. When any such corporation has entered into a contract with the authorities of any city, town or village not mentioned in its certificate of incorporation, but situ- ated in the same county as the city, towns or villages mentioned therein or an adjoining county, to supply it with pure and whole- some water, it may tile an amended certificate, stating the name of such other city, town or village to be so supplied with water, and it may thereupon supply any such city, town or village with water in the same manner and with "the eame rights and subject to the same requirements as if it had been named in the original certificate of incorporation. This section was amended by chap. 617 of 1892. ARTICLE VIII. TELEGRAPH AND TELEPHONE CORPORATIONS. SBOTION 100. Incorporation. 101. Extension of lines. 102. Construction of lines.* 103. Transmission of despatches.. 104. Consolidation of corporations. 105. Special policemen. 100. Incorporation. Seven or more persons may become a cor- poration for the purpose of constructing, owning, using and maintaining 20 TRANSPORTATION CORPORATIONS LAW. a line or lines of electric telegraph or telephone, wholly within or parth beyond the limits of this state, or for the purpose of owning any in terest in any such line or lines, or any grants therefor by executiug, acknowledging and filing a certificate, stating the name of the cor- poration ; its general route and the points to be connected; its capitul stock; the number of shares into which it is to be divided; the ter .:, of its existence ; the number of its directors not less than seven ; th-i names and residence of the directors for the first year, and the post- office address of the subscribers and the number of shares which each agrees to take in such corporation. 101. Extension of lines. Any such corporation may construct, own, use and maintain any line of electric telegraph or telephone, not described in its original certificate of incorporation, whether wholly within or wholly or partly beyond the limits of this state, and may join with any other corporation in constructing, leasing, owning, using and maintaining such line, or hold or own any interest therein, or become lessees thereof, upon filing in the same manner as the original certificate is required to be filed an amended certificate, executed and acknowledged by at least two-thirds of the directors of such corpora- tion, describing the general route of such line or lines, and designating the extreme points connected thereby, and upon procuring the written consent of the persons owning at least two-thirds of the capital stock of such corporation, and such amended certificate shall not be filed until there is indorsed thereon or annexed thereto an affidavit made by at least three of the directors of the corporation that such consent has been obtained, which affidavit shall be filed with and be a part of such certificate. 102. Construction of lines. Such corporation may erect, con- struct and maintain the necessary fixtures for its lines upon, over or under any of the public roads, streets and highways ; and through, across or under any of the waters within the limits of this state, and upon, through or over any other land, subject to the right of the owners thereof to full compensation for the same. If any such cor- poration can not agree with such owner or owners upon the compen-t sation to be paid therefor, such compensation shall be ascertained in the manner provided in the condemnation law. 103. Transmission of despatches. Every such corporation shall receive despatches from and for other telegraph or telephone lines or corporation, and from and for any individual, and on pay- ment of the usual charges by individuals for transmitting despatches as established by the rules and regulations of such corporation, trans- mit the same with impartiality and good faith and in the order in 21 TRANSPORTATION CORPORATIONS LAW. which they are received, and if it neglects or refuses so to do, it shall pay one hundred dollars for every such refusal or neglect to the per- son or persons sending or desiring to send any such despatch and entitled to have the sime so transmitted, but arrangements may be made with the proprietors or publishers of newspapers for the trans- mission for publication of intelligence of general arid public interest out of its regular order. 104. Consolidation of corporations. Any corporation organ- ized under this article may lease, sell or convey its property, rights, privileges and franchises, or any interest therein, or any part thereof to any telegraph or telepone corporation organized under or created by the laws of this or any other state, and may acquire by purchase, lease or conveyance the property rights, privileges and franchises, or any interest therein or part thereof of any such corporation, and may make payments therefor in its own stock, money or property, or receive pay- ment therefor in the stock, money or property of the corporation to which the same may be eo sold, leased or conveyed, but no such lease, sale, purchase or conveyance shall be valid until it shall have been ratified and approved by a three-fifths vote of its board of direct- ors or trustees, and by the vote or written consent of stocholders owning at least three-fifths of the capital stock given at a meeting of all the stockholders duly called for that purpose. 105. Special policemen. The police department or board of police of any city may, in addition to the police force now authorized by law, appoint a number of persons, not exceeding two hundred, who may be designated by any corporation operating a system of signaling by telegraph to a central office for police assistance, to act as special patrolmen in connection with such telegraphic system. And the per- son so appointed shall, in and about such service, have all the powers possessed by the members of the regular force, except as may be limited by and subject to the supervision and control of the police department or board of police of such city. No person shall be ap- pointed such special policeman who does not possess the qualifications required by such police department or board of police for such special service ; and persons so appointed shall be subject, in case of emer- gency, to do duty as part of the regular police force of the city. The police department or board of police shall have power to revoke any such appointment at any time, and every person appointed shall wear a badge and uniform, to be furnished by such corporation and approved by the police department or board of police, such uniform shall be designated at the time of the first appointment and shall be ttie permanent uniform to be worn by such special police, and the 22 TRANSPORTATION CORPORATIONS LAW. pay of such special patrolmen and all expenses connected with their service shall be wholly paid by such corporation, and no expense or liability shall at anytime be incurred or paid by the police depart- ment or board of police of any city, for or by reason of the services of such persons so appointed. ARTICLE IX. TURNPIKE, PLANKROAD AND BRIDGE CORPORATIONS. SECTION 120. Incorporation. 121. Restriction upon location of road. 122. Agreement for use of highway. 123. Application to board of supervisors. 124. Commissioners to lay out road. 125. Possession of and title to real estate. 126. Use of turnpike road by plankroad. 127. Width and construction of road. 128. Construction of bridges. 129. Certificate of completion of road or bridge. / 13 ) Toll -gates and rates of toll, and exemptions. 131 Toll gatherers. 132. Penalty for running a gate. 133. Location of gates and change thereof. 134. Inspectors, their powers and duties. 135. Change of route, extensions and branches. 136. Milestones, guide-posts and hoist-gates. 137. Location of office of corporation. 138. Consolidation of corporations, sale of franchise. 139. Surrender of road. 140. Taxation and exemption. 141. Hauling logs and timber. 142. Encroachment of fences. 143. Penalty for fast driving over bridges. 144. Acts of directors prohibited. 145. Actions for penalties. 146. Proof of incorporation. 147. When stockholders, to be directors. 148. Dissolution of corporation, road to be a highway. 149. Town must pay for lands not originally a highway. 150. Highway labor upon line of plankroad or turnpike. 151. Extension of corporate existence. 120. Incorporation. Five or more persons may become a corporation for the purpose of constructing, maintaining and owning a turnpike, plankroad or a bridge, or causeway across any stream or channel of water, or adjoining bay, swamp, marsh, or water to form in connection with such bridge or causeway a continuous roadway across the same, by signing, acknowledging and filing a certificate containing the name of ihe corporation, its duration, not exceeding fifty years, the amount and number of shares of its capital stock, the number of its directors, and their names and post-office address for the first year, the termini of the proposed road, its length, and each town, city or village into or through which it is to pass, or of a bridge, the location and plan thereof, and the post-office address of each subscriber, and 23 TRANSPORTATION CORPORATIONS LAW. the number of shares of stock which he agrees to take, the aggregate of which subscriptions shall not be less than five hundred dollars for every mile of road, or if a bridge corporation not less than one-fourth of the amount of the capital stock, and five per cent of which must be actually paid in cash. There shall be indorsed on and annexed to the certificate and made a part thereof the affidavit of at least three of the directors named therein, that the required amount of capital stock has been subscribed and the prescribed percentage paid in cash. 121. Restrictions upon location of road. No such road shall be laid out through any orchard of the growth of four years or more to the in jury- or destruction of fruit trees, or through any garden cul- tivated for four years or more before the laying out of the road, or through any dwelling-house or building connected therewith, or any yards or inclosures necessary for its use or enjoyment without the consent of the owner thereof, nor shall any such corporation bridge any stream in any manner that will prevent or endanger the passage of any raft of twenty-five feet in width, or where the same is navigable by vessels or steamboats. 122. Agreement for use of highways. The supervisor and commissioner of highways, or a majority if there be more than one of any town, may agree in writing with any such corporation for the use of any part of a public highway therein required for the construction of any such road, and the compensation to be paid by the corporation for taking and using such highway for such purpose on first obtaining consent of at least two-thirds of all the owners of land bounded on or along such highway, which agreement shall be filed and recorded in the town clerk's office of the town. If such agreement can not be made the corporation may acquire the right to take such highway for such purpose by condemnation. The compensation therefor shall be paid to the commissioners of highways, to be expended by them in improving the highways of the town. 123. Application to board of supervisors. If the lands necessary for the construction of the road or bridge of any such cor^ poration in any county have not been procured by gift or purchase, and the right to take and use any part of any highway therein required by such corporation shall not have been procured by agree- ment with the supervisor and commissioners of highways of the town in which such highway is situated, the corporation may make applica- tion to the board of supervisors or each county in which such bridge or road, or any part thereof, is to be located, for authority to build, lay out and construct the same, and take the necessary real estate for such purpose. Notice of the application shall be published in at least 24 TRANSPORTATION CORPORATIONS LAW. one public newspaper in each county for six successive weeks, specify- ing the time and place where it will be made, the location, length and breadth of any such bridge, and the length and route of any such pro- posed road, its character, and each town, city and village in or through which it is to be constructed. The application may be made at any annual or special meeting of the board, and if the corporation desires a special meeting therefor any three members of the board may fix a time when the same shall be held, and notice thereof shall be served upon each of the other supervisors by delivering the same to him personally or leaving it, at his place of residence at least twenty days before the minutes* and the expenses of the special meeting and of notifying the members of the board thereof shall be paid by the corporation. All persons interested therein or owning real estate in any of the towns through which it is proposed to construct the road may appear and be heard upon the hearing of the application. The board may take testimony in respect thereto, or authorize it to be taken by a committee of the board and may adjourn the hearing from time to time. After hearing the application the board may, by an order entered in its minutes, authorize the corporation to construct such bridge or road and to take the real estate necessary for that purpose, and a copy of the order certified by the clerk of the board shall be recorded by the corporation in the office of the clerk of the county in which such bridge or road or any part thereof is to be located before any act shall be done under it. 124. Commissioners to lay out road. If the application for the construction of any such road is granted, the board shall appoint three disinterested persons, not owners of real estate in any town, through which the road is to be constructed or in any adjoining town, commissioners to lay out the road. Tiiey shall take the constitutional o.ath of office, and without unnecessary delay lay out the route of such road in such manner as in their opinion will best promote the public interests ; they shall hear all persons interested who shall apply to be heard and may take testimony in relation thereto, and shall cause an accurate survey and description of the road and the necessary build- ings and gates, signed and acknowledged by them to be recorded in the clerk's office of the county. If the road is situated in more than one county, such survey and description shall be separate as to that portion in each county and filed in the office of the clerk of the county in* which it relates. The corporation shall pay each commissioner three dollars for every day spent by him in the performance of his duties and his necessary expenses. * So in the original. 25 TRANSPORTATION CORPORATIONS LAW. 125. Possession of and title to real estate. The route so laid out and surveyed by the commissioners shall bo the route of the road, and the corporation may enter upon, take and hold for the pur- poses of its incorporation, the lands described in such survey as neces- sary for the construction of its road, and requisite buildings and gates. If for any cause the owner of any of such lands shall be incapable of selling the same or his name or residence can not, with reasonable dili- gence be ascertained or the corporation is unable to agree with the owner for the purchase thereof it may acquire title thereto by con- demnation. 126. Use of turnpike road by plankroad. No plankroad shall be made on the roadway of any turnpike corporation without its consent, except for the purpose of crossing the same. Any plank- road corporation may contract with any connecting turnpike corpo- ration for the purchase of its roadway or a part thereof, or of its stock, on such terms as may be mutually agreed upon, and such stock, if purchased, shall be held by the plankroad corporation for the benefit of its stockholders in proportion to the amount of stock held by each, and a transfer of stock in the plankroad corporation shall carry with it its proportional amount of the turnpike stock, and entitle the holder thereof to his share of the dividends derived therefrom. After the purchase of the \vhole of the stock of any such turnpike corporation by such plankroad corporation the directors of the plankroad cor- poration shall be the directors of the turnpike corporation, and shall manage its affairs and render an account of the same annually to the stockholders of the plankroad corporation. If the plankroad cor- poration is dissolved, is stockholders at the time of dissolution shall be the stockholders of the turnpike corporation in proportion to the amount of stock held by each, and the stock of the turnpike corpo- ration shall thereafter be deemed to be divided into shares equal ii? number to the shares of stock of the late plankroad corporation, and scrip therefor shall be issued accordingly to each of the last stock- holders of the plankroad corporation, and the officers of the turnpike corporation shall be the same in number as provided for in its charter or certificate of incorporation, and shall be chosen by such former stockholders of the plankroad corporation or their assigns. A corpora- tion owning a turnpike road on or adjoining which a plankroad shall have been constructed 'may abandon that portion of its road on or adjoining the route of which a plankroad is actually constructed and used. 127. Width and construction of road. Every such plank- road shall be so constructed as to make, secure and maintain a smooth 26 TRANSPORTATION CORPORATIONS LAW. and permanent road, the track of which shall be made of timber, plank or other hard material forming a hard and even surface, and every such turnpike road shall be bedded with stone, gravel or such other material as may be found on the line thereof, and faced with broken stone or gravel, forming a hard and even surface with good and sufficient ditches on each side wherever practicable, and all such roads shall be laid out at least four rods wide and the arch or bed at least eighteen feet wide, and shall be so constructed as to permit car- riages and other vehicles conveniently to pass each other, and to pass on and off such road where intersected with other roads. Any corpora- tion which shall have once laid its road with plank may relay the came, or any part thereof, with broken stone, gravel, shelb or other hard materials, forming a good and substantial road. Any plankroad or turnpike corporation may lay iron rails on its road suitable for the use of wagons and vehicles drawn by horses or animals over its road, but no other motive power shall be used thereon. 128. Construction of bridges; obstruction of rafts prohib- ited. Every bridge constructed by any such corporation shall be built with a good and substantial railing or sliding at least lour and one-half feet high, and over any stream navigable by rafts the corpo- ration shall keep the channel of the stream above and below the bridge free and clear from all deposits, formed or occasioned by the erection of the bridge, which shall in any wise obstruct the navigation thereof, and shall be liable to all persons unreasonably or unneces- sarily delayed or hindered in passing the same for all damages sus- tained thereby. Nothing in this act shall be construed to authorize the bridging of any river or water-course where the tide ebbs and flows, or any waters over which the federal authorities have any con- trol, unless the consent of such federal authorities be first obtained; nor the construction of any bridge within the limits prescribed by any existing law for the erection or maintenance of any other bridge. Am'd by chap. 778 of 1896. In effect Tttay 20, 1896. 129. Certificate of completion of road or bridge. When any such corporation shall have completed its bridge or road or any five consecutive miles thereof, it may apply to the commissioners of high- ways of each town in which the completed road or bridge is situated to inspect the same, and if a majority of the commissioners are satis- fied that the road or bridge is made and completed as required by law and in a manner safe and convenient for the public use, they shall make a certificate to that effect, which shall be filed in the office of the county clerk. Each commissioner shall be paid by the corporation two dollars per day for his services and necessary expenses. 130. Gates, rates of toll; and exemption. Upon filing such certificate such corporation may erect a toll-gate at such bridge or one or more toll-gates upon the road so inspected, and may demand and receive the following rates of toll, a printed list of which shall 27 TRANSPORTATION CORPORATIONS LAW. be conspicuously posted at or over each gate. If a bridge corporation, such sum as shall be from time to time prescribed by the board of supervisors of the county or counties in which the bridge is located. If a turnpike or plank- road, for every vehicle drawn by one animal, one cent per mile, and one cent per mile for each additional animal ; for every vehicle used chiefly for carrying passengers, three cents per mile, and one cent per mile for each additional animal; for every horse rode, led or driven, three-quarters of a cent per mile; for every score of sheep or swine, one and one-half cents per mile, and for every score of neat cattle, two cents per mile. When diverging roads strike any plank-road or turnpike at or near any toll-gate, the board of super- visors of the county may direct that the toll charge shall commence from the point of such divergence, and only for the distance traveled on such turnpike or plank-road, but fractions of cents may be made units of cents in favor of the plank-road or turnpike corporation. The corporation may from time to time commute, but not for a longer period than one year at any one time, with any person whose place of abode shall adjoin or be near to the road for the toll payable at the nearest gate on each side thereof, and the commutation may be renewed from year to year. No tolls shall be charged or collected at any gate, from any person going to or from public worship, a funeral, school, town meeting or election at which he is a voter to cast his vote, a military parade which he is required by law to attend, any court which he shall be required to attend as a juror or witness, nor when going to or from his required work upon any public highway, nor when transporting troops in the actual service of the United States ; and no toll from persons living within one-half mile of the gate by the most usual traveled road when not engaged in the transportation of other persons or property except that persons living within one mile of the gate, by the most usually traveled road, in an incorporated vil- lage of over six thousand inhabitants, when not engaged in the trans- portation of the persons or.property shall be exempt from the payment of toll. Am'd by chap. 538 of 1893. 131. Toll gatherers. Every such corporation may appoint toll gatherers to collect toll at each gate, who may detain and prevent from passing through the gate, any person riding, leading or driving animals or vehicles, subject to the payment of toll, until the toll is paid, but if he shall unreasonably hinder or delay any traveler or pas- senger liable t.6 the payment of toll, or shall demand or receive from any person more toll than he is authorized by law to collect, he fchall forfeit to such person the sum of five dollars for every offense, and the corporation employing him shall be liable for the payment thereof, and for any damages sustained by any person for acts done or omitted to be done by him in his capacity of toll gatherer, if, on recovery ot 28 TRANSPORTATION CORPORATIONS LAW. judgment against the toll gatherer therefor, execution thereon shall be return nulla bona. 132. Penalty for running agate. Any person who, with intent to avoid the payment of toll, shall pass any gate, without paying the toll required by law, or shall, with his team, carriage or horse, turn out of a turnpike or plankroad and pass any gate thereon on ground adjacent thereto, shall forfeit for each offense the sum of ten dollars to the corporation injured. 133. Location of gates and change thereof. No such cor- poration shall erect any toll-gate, house, or other building within ten rods of the front of any dwelling-house, barn or other out house, without the written consent of the owner, and the county judge of the county in which the same is located shall, on application, order any building so erected to be removed, and if a majority of the com- missioners of highways of any town, in which a toll-gate shall be located, or in an adjoining town, shall deem the location of any gate unjust to the public interests by reason of the proximity of diverging roads or otherwise, they may, on fifteen days' written notice to the president or secretary of the corporation, apply to the county court of the county in which the gate is located, for an order to alter or change its location. On hearing such application, and viewing the premises, if deemed necessary, the court may make such order in the matter as may be just and proper. Either party may, within fifteen days thereafter, appeal to the general term of the supreme court from such order, on giving such security as the county judge, making the order, may prescribe. Upon such appeal the supreme court, on motion of either party and on due notice, shall appoint three disinter- ested persons who are not residents of any town through or into which such road shall run, or to or from which it is the principal thorough- fare, or any adjoining town, as referees to hear, try and determine the appeal. Such referees shall view the premises and the location of the gate, and hear the parties in the same manner as on the trial of an issue of fact by a referee in a civil action in the supreme court, and re- port their decision thereon and the reasons therefor, and the evidence taken thereon to the supreme court, and such court shall review the report and render judgment thereon as justice and equity shall re- quire, which shall be final and conclusive. The referees shall be en- titled to the same fees as referees in civil actions in the supreme court, to be paid in the first instance by the party in whose favor their report or decision shall be, and the supreme court shall award judg- ment therefor, with such costs and expenses as it may deem reasonable, to the successful party on the appeal, which judgment shall be entered 29 TRANSPORTATION CORPORATIONS LAW. with the order affirming or reversing the order appealed from, and may be enforced by execution as a judgment of a court of record. If the order of the county court is not appealed from, it may be enforced, as the court may direct, and the court may allow such costs as may be deemed just and equitable. 134. Inspectors; their powers and duties. The commis- sioners of highways of the several towns and the trustees or other of- ficers in tlii- incorporated cities and villages of the state, who perform the duties of commissioners of highways in such citk-s ninl villages, shail be inspectors of plank-roads and turnpikes, in their respective towns, cities and villages. They shall inspect or cause to be inspected by one or more of them the whole of such turnpike or plank-roads as lies in their respective towns, villages or cities, at least once iu each month, and whenever written complaint shall be made to any in- spector, that any part of such road lying iu the town, city or village of such inspector is out of repair he shall, without delay, view and ex- amine the part complained of. If such turnpike or plank-road shall be found to be out of repair or in condition not to be conveniently used by the public, such inspectors or either of them, or the one to whom such complaint shall have been made, shall give written notice to the toll-gatherer, or person attending the gate nearest the place out of repair or in bad condition to cause the same to be put in good con- dition before a time therein designated not less than forty -eight hours after the service of such notice, or to appear before the county court of the county in which that part of the road is situated, at a time in said notice designated, and show cause why such turnpike or plank- road should not be repaired or put iu good condition as in said notice directed. If such road shall not have been theretofore repaired or put in good condition as in said notice directed then the county court shall, upon the return of such notice hear the allegations and proofs of the parties, and it shall always be open for that purpose; and if the court shall find such road to be out of repair or in bad condition it may give additional time for the repair thereof, or it may order the gate nearest the place out of repair or in bad condition to be immedi- ately upon the service of the order, or at a time therein specified, thrown open and to remain open until the roud shall be fully repaired at the place directed to be repaired as aforesaid. Such order shall be served in the manner therein specified upon the keeper of the gate so ordered to be thrown open. Any inspector within the town, city or village where such road has been repaired pursuant to notice or order as aforesaid, may certify that such road has been duly repaired. The fees of the inspector for the services above mentioned shall be two dol- lars for each day actually employed, together with necessary witnesses, fees, to be paid by rhe corporation or person whose road is so inspected, if the gates are ordered to be thrown open, but otherwise to be charged, audited and paid in the same manner as other fees of commissioners of highways. Any inspector who neglects to perform his duties shall forfeit to the party aggrieved the sum of twenty-five dollars for each offense. Every keeper of a gate ordered to be thrown open, not im- mediately obeying such order or not keeping such gate open until such road shall be fully repaired or until a certificate that such road has been duly repaired is granted, or hindering or delaying any per- 30 TRANSPORTATION CORPORATION LAW. son in passing, or taking any tolls from any person passing such gate during the time it ought to be open, shall forfeit to the party ag- grieved the sum of ten dollars for each offense, and the corporation or person owning the road, who shall refuse or neglect to obey the re- quirements of any such order shall forfeit to the people of the state the sum of two hundred dollars for each offense. Am'd by ch. 343 of 1896. Took effect April 21, 1896. 135. Change of route ; extensions and branches. Any such corporation may, with the written consent of the owners of two-thirds of its capital stock and of a majority of the commissioners of high- ways of the town or towns, in which any change or extension is pro- posed to be made, construct branches to its main line or extend the same, or change the route of its road or any part thereof, and acquire the right of way for the same in the same manner as for the original or main line, and may, by any of its officers,agents or servants, enter upon lands for the purpose of making any examination, surveyor map, doing no unnecessary damage; but before entering upon, taking or using such lands, the corporation shall make a survey and map thereof, designat : ng thereon the lands of each owner or occupant intended to be taken or used, which shall be signed and acknowledged by the engineer making the same and the president of the corporation and filed in the office of the clerk of the county iu which the land is situated. 13(3. Mile -stones, guide-posts and hoist-gates. A mile- stone or post shall be erected and maintained by every such corpora- tion on each mile of its road, on which shall be fairly and legibly marked or inscribed the distance of such stone or post from the place of commencement of the road, and when the road shall commence at the end of any other road having mile-stones or posts on which the dis- tance from any city or town is marked, a continuation of that distance shall in like manner be inscribed. A guide-post shall also be erected at the intersection of every public road leading into or from every turnpike or plankroad, on which shall be inscribed the name of the place to which such intersecting road leads in the direction to which the name on the guide post shall point. No plankroad or turnpike corporation shall erect or put up any hoist-gate on its road. Any person who shall willfully break, cut down, deface or injure any mile- stone, post or gate on such road, or dig up, or injure any part of the road, or anything belonging thereto, shall forfeit to the corporation twenty- five dollars for every offense, in addition to the damage* resulting from the act. 137. Location of office of corporation. Within two weeks after the formation of any such corporation its directors shall desig- nate some place within a county in which its road or bridge, or some 31 TRANSPORTATION CORPORATIONS LAW. part thereof shall be constructed as its office, and shall give public notice thereof by publishing the same once in each week for three successive weeks in a public newspaper in the county, and shall file a copy of the notice in the office of the county clerk of every county in which any part of the road or bridge is, or is to be constructed, and if the location of such office shall be changed, like notice of the change shall be published and filed, in which shall be specified the time of making the change, before it shall take effect. Every notice, sum- mons or other paper required by law to be served on the corporation may be served by leaving the same at such office with any person hav- ing charge thereof, at any time between nine o'clock in the forenoon, and five o'clock in the afternoon of any day except Sunday or a legal holiday. 138. Consolidation of corporations and sale of franchise. Any two or more of such corporations may consolidate into one cor- poration on such terms as the persons owning two-thirds of the stock of each corporation may agree upon, and may change the name of the road on filing in the office where the original certificates of incorpora- tion were filed, a certificate containing the names of the roads so consoli- dated, and the name by which such road shall thereafter be known. Any plankroad or turnpike corporation may, with the consent of the owners of sixty per cent of its stock, sell, and convey the whole or any part of its rights, property and franchises to any other domestic plankroad or turnpike corporation, and such sale and conveyance shall vest the rights, property and franchises thereby transferred in the corporation to which they are conveyed for the term of its corpo- rate existence. 139. Surrender of road. The directors of any plankroad or turnpike corporation may abandon the whole or. any part of its road at either or both ends thereof, upon obtaining the written consent of its stockholders, owning two-thirds of the stock of the corporation, which surrender shall be by a declaration in writing to that effect, attested by the seal of the corporation and acknowledged by the president and secretary. Such declaration and con- sent shall be filed and recorded in the clerk's office of the county in which any part of the road abandoned shall be situated, and the road so abandoned shall cease to be the road or the property of the corporation, and shall revert and belong to the several towns, cities and villages through which it was constructed, and the corporation shall no longer be liable to maintain it or to be assessed thereon, or permitted to collect tolls for traveling over the same, but without impairing its right to take toll on the remaining part of its road at the rate prescribed by law. And whenever any turnpike or plankroad company, now existing or hereafter created, shall abandon all or any part of its road within this state, in the manner above provided, or when- ever its charter or franchise of such company shall be annulled or revoked, the road of such turnpike or plankroad company shall revert to and belong to the several towns, cities and villages through which such road shall pass. And it shall be the duty of the several towns, cities and villages acquiring any road under this act to immediately lay out and declare the same a free public highway. And it shall be the 'duty of the several town-;, cities and villages, to maintain and work every road acquired under the provisions of this act in the same manner as the other roads of such towns, cities and vil- lages are maintained and worked. And any town, city or village may bor- row money in the manner provided by. law for the purpose of improving or repairing the same. Am'd by ch. 964 of 1896. In effect May 28, 1896. 33 TRANSPORTATION CORPORATIONS LAW. 140. Taxation and exemption. So much of any bridge or toll-house of any bridge corporation as may be within any town, city or village, shall be liable to taxation therein as real estate. Toll-houpea and other fixtures and all property belonging to any plankroad or turnpike corporation shall be exempt from assessment and taxation for any purpose until the surplus annual receipts of tolls on its road over necessary repairs and a suitable reserve fund for repairs or relay- ing of plank, shall exceed seven per cent per annum on the first cost of the road. If the assessors of any town, village or city and the cor- poration disagree concerning any exemption claim, the corporation may appeal to the county judge of the county in which such assess- ment is proposed to be made, who shall, after due notice to both parties, examine the books and vouchers of the corporation, and take euch further proof as he shall deem proper, and decide whether such corporation is liable to taxation under this section, and his decision shall be final. 141. Hauling logs and timber. Any person who shall draw or haul or cause to be drawn or hauled, any logs, timber or other ma- terial upon the bed of any plank or turnpike road, unless the same shall be entirely elevated above the surface of the road on wheels or runners, and the road-bed shall be injured thereby, or who shall do or cause to be done any act by which the road-bed, or any ditch, sluice, culvert or drain appertaining to any turnpike or plankroad shall be injured or obstructed, or shall divert or cause to be diverted, any stream of water so as to injure or endanger any part of such road, shall forfeit to the corporation the sum of five dollars for every offense in addition to the damages resulting from the wrongful act. 142. Encroachment of fences. Whenever the president or secretary of any turnpike or plankroad corporation shall notify any inspector of such roads in the county where situated that any person is erecting or has erected any fence or other structure upon any part of the premises lawfully set apart for any such turnpike or plankroad, the inspector shall examine into the facts and order the fence or other structure to be removed if it shall appear to be upon any part of any such road, and any person neglecting or refusing to remove the same within twenty days or such further time not exceeding three months, as may be fixed by the inspector, shall forfeit to the corporation the sum of five dollars for every day, during which the fence or otheri structure shall remain upon such road, but no such order shall require the removal of any fence, previously erected, between the first day of December and the first day of April. 8 143. Penalty for fast driving over bridges. Any plankroad, 33 TRANSPORTATION CORPORATIONS LAW. turnpike or bridge corporation may put up and maintain at conspicu- ous places at each end of any bridge, owned or maintained by it, the length of whose span is not less than twenty-five feet, a notice with the following words in large characters : "One dollar fine for riding or driving over this bridge faster than a walk." Whoever shall ride or drive faster than a walk, over any bridge, upon which such notice shall have been placed, and shall then be, shall forfeit to the corpora- tion the sum of one dollar for every such offense. 144. Acts of directors prohibited. No director of any such corporation shall be concerned, directly or indirectly, in any contract for making or working any road belonging to it during the time he shall be a director. No contractor for the making of such road, or any part thereof, shall make a new contract for the performance of his work, or any part of it, other than by hiring hands, teams, car- riages or utensils to be superintended and paid by himself, unless such new contract and its terms be laid before the board of directors and be approved by them. 145. Actions for penalties. No action to recover any penalty against any turnpike or plankroad corporation, shall be commenced or maintained against it, or any of its officers or agents", unless com- menced within thirty days after the penalty was incurred. 146. Proof of incorporation. In any action brought by or against any domestic turnpike or plankroad corporation, which shall have been in actual operation, and in possession of a road upon which it has taken toll for five consecutive years, next preceding the com- mencement of the action, parol proof of such corporate existence and use shall be sufficient to establish the incorporation of the corporation, for all the purposes of the action, unless the opposing party shall set up a claim in his complaint or answer duly verified of title in himself to the road, or some part thereof stating the nature of his title, and right to the immediate possession and use thereof. 147. "When stockholders to be directors. When the whole number of stockholders in any turnpike or plankroad corporation shall not exceed the number of directors specified in the certificate of incor- poration, each stockholder shall be a director of such corporation, and the stockholders shall constitute the board of directors, whatever may be their number, and a majority thereof shall be a quorum for the transaction of business. 148. Dissolution of corporation. Every turnpike, plankroad or bridge corporation may be dissolved by the legislature when, by the income arising from tolls, it shall have been compensated for all 34 TRANSPORTATION CORPORATIONS LAW. moneys expended in purchasing, making, repairing and taking ca*v of its road, and have received in addition thereto an average annu; { interest at the rate of ten per cent, arid on such dissolution all tto / rights and property of the corporation shall vest in the people of th* state. Any such corporation, which shall not within two years fronc the filing of its certificate of incorporation, have commenced th< construction of its road or bridge and actually expended thereon ten per cent of its capital, or winch shall not within five years from such filing have completed its road or bridge, or, in case such bridge ia destroyed, shall not rebuild the same within five years, or which, for a period of five consecutive years shall have neglected or omitted to exercise its corporate functions shall be deemed dissolved. Where the corporation has neglected or omitted for five years to exercise its cor- porate functions, and its road-bed or right of way shall have been used as a public highway for that period, or where any such corporation shall have become dissolved, or where the road or any part of it of a turnpike or plankroad corporation, or the bridge of any bridge cor- poration, shall have been discontinued, such road-bed or right of way, and such discontinued road or bridge, and the road or bridge of any such dissolved corporation, shcall thereafter be a public highway, with the same effect as if laid out by the commissioners of highways of the town, and be subject to the laws relating to highways and the erec- tion, repairing and preservation of bridges thereon. 149. Town must pay for lands not originally a highway. When the corporate existence of any plankroad or turnpike corpora- tion shall have ceased by limitation of time, or where any judgment of ouster or dissolution, or restraining the exercises of its franchises has been rendered in any action against it, such portion of the line of its road as was built over lands which were originally purchased by it and not previously a public highway shall not be used as a public highway, nor be taken possession or control of by the town in which the same may be, or by any of the authorities thereof or be claimed or worked or used as a public highway until the town shall pay over to the treasurer, receiver or other legal representatives of the corporation, or its assigns, the principal sum of the amounts paid by it for such lands, as shown by the deeds of conveyance thereof to it, and every such judgment shall provide accordingly. Such payments shall be made within three months after the expiration of the corporate ex- istence of the corporation, or if any such judgment has been or shall be rendered within three months after service of written notice of th* entry thereof on the supervisor of the town, and the person receivir, { such payment shall execute a proper discharge therefor and a convey 35 TRANSPORTATION C^PORATIOXS LA\V. ance to the town of all the title .-iid interest which the corporation had in such lands at the expiration of its corporate existence. 150. Highway labor upon line of plankroad or turnpike. Every person liable for highway labor living or owning property on the iine of any plankroad or turnpike may, on written application to the commissioners of highways of the town, on any day previous to making out the highway warrant by the commissioners, be assessed for the highway labor upon his property upon the line of such road, in the discretion of the commissioners to be worked out upon the line of such road as a separate road district, and the commissioners shall make a separate list of the persons and property so assessed, as for a separate road district, and deliver the same to one of the directors of the corporation owning such road, who shall cause such highway labor to be worked out an such road in the same manner that over- sees* of highways are required to do, and such directors shall possess the powers and have the authority to compel the performance of such highway labor or the payment of the tax therefor as such oversees* now have by law, and shall make like returns to the commissioner of highways, and any person so assessed may commute for the highway labor assessed upon him or his property by paying the sum now fixed by law as the commutation for such highway labor. 151. Extension of corporate existence. No turnpike, plankroad or bridge corporation shall extend its corporate existence, pursuant to the provisions of the general corporation law, without the written consent of the persons owning at least two-thirds of its capital stock, nor without the consent of the board of supervisors of each county in which any part of its road or bridge is situated, which con* sent shall be given by a resolution of the board adopted at any regulai or special meeting, and a copy of such resolution, certified by the elerk of the board, or verified by the afiidavit of some member thereof- together with such consent of the stockholders, and a statement veri- fied by the afiidavit of the president and treasurer of the corporation, showing the actual capital expended upon the construction of the road, exclusive of repairs, the name of each town or ward through or into which the road passes, and, if any part of the road shall have been abandoned, the actual cost of the remaining part, exclusive of repairs, shall be filed with the certificate of the continuance of the corporate existence. No further abandonment of any road belonging to a cor- poration whose corporate existence has been so extended shall be made, except with the consent of a majority of the board of supervisors of the county in which the abandoned portion of the road may lie, which consent shall be filed in the office of the clerk of the county. * So in the original. 36 TRANSPORTATION CORPORATIONS LAW. ARTICLE X. MISCELLANEOUS PROVISIONS. SECTION 160. Laws repealed, 161 Saving clause. 162. Construction. 163. When to take offect. SECTION 160. Laws repealed, Of the laws enumerated in tho schedule hereto annexed, that portion specified in the last column fe repealed. Such repeal shall not revive a law repealed by any law hereby repealed, but shall include all laws amendatory of the laws hereby repealed. 161. Saving clause. The repeal of a law or any part of it specified in the annexed schedule shall not affect or impair any act done, or right accruing, accrued or acquired, or liability, penalty, for- feiture or punishment incurred prior to May first, eighteen hundred and ninety-one, tinder or by virtue of any law so repealed, but the same may be asserted, enforced, prosecuted or inflicted, as fully and to the same extent, as if such law had not been repealed ; and all actions and proceedings civil or criminal, commenced under or by virtue of the laws so repealed and pending on April thirtieth, eighteen hundred and ninety-one, may be prosecuted and defended to final effect, in the* same manner as they might under the laws then existing, unless it shall be otherwise specially provided by law. 162. Construction. The pr ^visions of this chapter, so far as they are substantially the same as Ihose of laws existing on April thirtieth eighteen hundred and ninety-one, shall be construed as a continuation of such laws modified or amended apcording to the lan- guage employed in this chapter, and not as new enactments ; and ref- erences in laws not repealed to provisions of laws incorporated int this chapter and repealed shall be construed as applying to the pro- visions so incorporated, and nothing in this chapter shall be construed to amend or repeal any provision of the Criminal or Penal Code. 163. When to take effect. This chapter shall take effect on May first, eighteen hundred and ninety-one. TRANSPORTATION CORPORATIONS LAW. SCHEDULE OP LAWS REPEALED. REVISED STATUTES, PART 1. Chapter 18, title L All. Laws of Chapter SECTIONS. 1836 284 All 1838 262 All 1847 210 All 1847 287 All 1847 398 All. 1848 37 All. 1848 45 All. 1848 265 All. 1848 259 All. 1848 360 All 1849 250 All. 1849 362 All. 1850 71 All, except tli6 1851 107 All [1st sect'n. 1851 487 All. 1851 98 All. 1852 228 All. 1852 372 All. 1853 124 All. 1853 135 All. 1853 245 All. 1853 471 All. 1853 626 All. 1854 3 All. 1854 87 All. 1854 232 All. 1855 300 All. 1855 485 All. 1855 546 All. 1855 559 All. 1857 83 All. 1857 202 All. 1857 643 All. 1858 10 All. 1859 , 209 All. 1859..... 311 All. I860 116 All. 1861 215 All. 1861 238 All. 1862 205 All. 1862 248 All. 1862 425 All. 1865 691 All. 1865 ^80 All. 1866... 780... All. TRANSPORTATION CORPORATIONS LAW. SCHEDULE OP LAWS REPEALED (Continued). Laws of Chapter SECTIONS. 1867 419 All. 1867 974 All. 1868 253 All. 1869 234 All. 1870 443 All. 1870 . 568 All. 1871 95 All. 1872 -. 128 All. 1872 283 All. 1872 374 All. 1872 779 All. 1872 780 All. 1873 440 Aii. 1873 737 All. 1875 4 All. 1875 120 All. 1875 319... All. 1875 445 All. 1876 135 All. 1876 373 All. 1876 415 Ml. 1876 435 All. 1877 k 164 All. I,s78 203 All. 1878 394> All. 1879 214 All. 1879 253 All. 1879 377 All. 1879 441 All. 17 512 All. 1880 90 All. 1880 484 All. 1881 77 All. 1881 117 All. 1881 213 All. 1801 311 All. 1881 313 All. 1881 337 All. 1881 464 All. 1881 674 All. 1882 289 All. 1883 21(5 All. 1883 r!-->H All. 1883 409 All. 1883 4 and , to me severally known to be the persons described 41 TRANSPORTATION COMPANIES FORMS. in and who executed the foregoing certificate, and they severally acknowledged that they executed the same. Justice of the Peace. STATE OF NEW YORK, \ County of , J - s and , being severally duly sworn, does each for himself say that he is one of the directors named in the foregoing certificate; that at least ten per cent, of the amount of capital stock named therein has been in good faith subscribed, and at least ten per cent, of such subscriptions has been paid in cash. (Jurat.) , At least three directors must execute the above. No. 2. Form of Certificate of full payment of capital stock by Navigation Company, STATE OF NEW YORK, \ County of . / Sl "We, the president, and , , , and , a majority of the directors of , do hereby certify : The amount of the capital stock of said company has been paid in. The last installment thereof, to wit, the sum of dollars, was paid in on the day of , 18 . In witness whereof, we have made and signed this certificate, this day of , 18. Add acknowledgment as in preceding form. OF NEW "X County of- STATE OF NEW YORK, ) ^ , , , , and , being severally duly sworn, does each for himself, say that the said is the president, and said , , , and , are directors of , and a majority thereof; that he has read the foregoing certificate and knows the contents thereof, and that the same is true. (Jurat.) , 42 TRANSPORT VTION COMPANIES FORMS. No 3 Form of Certificate of Incorporation of a Ferry Company. (Follow form for incorporating Navigation Company, inserting only clauses 1, 4, 5, 6, 7 and 8. And adding the following clause :) 2. The places from and to which the ferry to be established shall run are from to . (Similar acknowledgment clause as in such form.) No 4. Form of affidavit as to payment of one-half of capital stock of Ferry Company. STATE OF NEW YORK, ) s< County of . f ss ' , and , being duly sworn, does each for himself say that he is a director of , and that said , and constitute a majority of the directors thereof; that such com- pany is a ferry corporation duly organized under the laws of this state ; and that at least one-half of the capital stock of such company has been actually paid in. (Jurat.) , No. 5. Form of Certificate of Incorporation of a Stage Coach Company. (Follow form of certificate of Navigation Company, inserting only clauses 1, 2, 4, 5, 7, 8, 10, and add the following clause :) 3. The route or routes upon which such company is to run, as near as practica- ble, are . 6. The place of residence of each subscriber is as follows : (Omit certificate as to payment of ten per cent, of capital stock.) No. 6. Form of Certificate of Incorporation of a Tramway Corporation. (Follow form of certificate of Navigation Company, inserting only clauses 1, 2, 4, 5, 6, 7, 8, and adding the following clauses : ) 8. The places from and to which such tramway is to be constructed) maintained and operated, are as follows : From to . ( 9.) Its length, as near as may be, is to be . (10.) The name of each county, through which or in which it ifl intended to be made, is . 48 COMPANIES FORMS. (11.) The place of residence of each subscriber to its capital stock is as follows : Name. Place of residence. (Omit certificate as to payment of stock.) No. 7. The last form can be readily adapted, in fact fully followed, in case of a Pipe Line Company. (The following certificate must be attached.) STATE OF NEW YORK, ) County of , / , , and , being severally duly sworn, does each for himself say, that he is a director named in the foregoing certifi- cate of incorporation ; that at least ten hundred and fifty dollars of stock for every mile of line proposed to be constructed (or operated) has been in good faith subscribed, and twenty-five per cent, paid in money thereon ; that it is intended in good faith to construct (or operate) the line of pipe mentioned in such certificate ; that such corporation was not projected or formed with the intent or for the purpose of injuring any person or corporation, nor for the purpose of selling or conveying its franchise to any person or corporation, nor for any fraudulent purpose. (Jurat.) , No. 8. Form of Certificate of a Gfas Company. (Follow form of certificate of Navigation Company, inserting only clauses 1, 2, 4, 5, 6, 7, 8, and adding the following clause): 8. The name of the town and county in which the operations of the company are to be carried on, is . (Omit certificate as to payment of stock.) No. 9. The last form of certificate will answer in case of an Electric Light Company. 44 TRANSPORTATION COMPANIES FORMS. No. 10. Form of Certificate of Incorporation of a Water- Works Company. (Follow form of certificate of Navigation Company, inserting only clauses 1, 2, 4, 6, 7, 8, 9, 10,, and adding the following clauses) : ( 3.) The names of the towns and villages which it is proposed to eupply with water, are . (3a.) The permit of the authorities of such towns and villages has b.-i-u granted, and is hereto attached, marked Ex. "A," and made a part of this certificate. ( 5 .) The post-office address of each subscriber to the capital stock of such company, is as follows : Names. Post-office address. Use the same acknowledgment clause and affidavit as are attached to said form, but the latter must be verified by at least seven directors. Ex. "A," referred to in the foregoing certificate. We, the undersigned, being a majority of the board of trustees of the village of , having received, on the day of , 18 , from , an application, do hereby grant a permit, author- izing the formation of a corporation for the purpose of supplying such village and the inhabitants thereof with water. In witness thereof, we have made and signed this permit, this day of , 18. (Signatures). (Add acknowledgment clause). "Where intention is to supply water to town or unincorporated vil- lage, the permit must be made and acknowledged by the supervisor, justice of the peace, town clerk and highway commissioners thereof, or a majority of them. No. 11. Form of Certificate of Incorporation of a Telegraph or Telephone Company. (Follow form of certificate of Navigation Company, inserting only clauses 1, 2, 4, 5, 6, 7, 8, 10, and adding the following clauses) : 3. Its general route and the points to be connected are . (9.) The post-office address of the subscribers is as follows: Names. Post-office address. 46 TRANSPORTATION COMPANIES FORMS. No. 12. Form of Certificate for extension of lines of Telegraph or Telephone Com- pany. STATE OF NEW YORK, } County of , ) We, being at least two-thirds of the directors of , do hereby certify that the written consent of the persons owning at least two- thirds of the capital stock thereof has been procured, as shown by Ex. " A," which is hereby made a part of this certificate ; that such cor- poration desires to construct, own, use and maintain a line of electric telegraph or telephone, not described in the original certificate of in- corporation (or, state one of the grounds specified in section 101). We do hereby, for the said purpose, execute this amended certificate : (Insert same recitals as in original, but make the description cover A>th the present and proposed routes.) In witness whereof, we have executed and acknowledged this amended certificate, this day of , 18 . Add acknowledgment clause. (Signatures.) Ex. " A," referred to in foregoing certificate. STATE OP NEW YORK, ) County of , ) , and , being severally duly sworn, does each for himself say that he is a director of ; that the persons who have executed and acknowledged the foregoing certificate constitute at least two-thirds of the directors of such company ; and that the written consent of persons owning at least two-thirds of the capital stock of such company has been obtained for carrying out the objects set forth in the foregoing amended certificate. (Jurat.) , No. 13. Form of Certificate of Incorporation of a Turnpike or Plank-road Company. (Follow form of certificate of Navigation Company, inserting only clauses 1, 2, 4, 5, 6, 7, 10, and adding the following clauses) : ( 3 .) The names and post-office address of the directors for the year are as follows, viz.: Names. Post-office address. ( 8 ) The termini of the proposed road are . (9.) Its length is to be . (11.) The name of each town, city or village into or through which such road is to pass is >-. 46 ..\-nu;rA rsost ' 'OMPAXIES FORMS. ( .) The post-office address of each subscriber is as follows :. Name. Post-office Address. Add acknowledgment clause as in said form and attach the following certificate : STATE OP NEW YORK, 1 County of . J , and , being severally duly sworn, does each for himself say that he is a director named in the foregoing certificate of incorporation ; that the aggregate of the subscriptions to such cer- tificate is at least five hundred dollars for every mile of road to be con- ytructed, and that five per cent, of such subscriptions has been actually paid in cash. (Jurat.) , No. 14. Form of Certificate of Incorporation of a Bridge Company. (Follow form of certificate of Navigation Company, inserting only clauses 1, 2, 4, 5, 6, 7, 10, and adding the following clauses) : (3.) The names and post-office address of the directors for the first year are as follows, viz.: Names. Post-office address. (8.) The location and plan of such bridge'are . ( 9 .) The post-office address of each subscriber is as follows : Names. Post-office Address. (Acknowledgment clause as in said form.) STATE OP NEW YORK, \ County of . ) s& , and , being duly sworn, does each for himself say, that he is a director named in the foregoing certificate of incor- poration ; that the aggregate of the subscriptions to such certificate is at least one-fourth of the amount of the capital stock therein stated, and that five per cent, of such subscriptions has been actually paid in cash. 47 INDEX. BM, Act, construction of 162 repealing laws 160 saving clause 161 title of 1 to take effect, when 163 Act incorporating bridge company 120-151 electric light ". 60-70 ferry 1-6 gas 60-70 navigation 10-13 pipe line 10-54 plankroad 120-151 stage coach 20-22 telegraph 100-105 telephone 100-105 tramway 30-33 turnpike , 120-151 water- works 80-85 Bridge 120-151 See TURNPIKE. abandonment, how effected after extension of corporate ex- istence 151 appeal from order of inspectors to throw gates open. , 134 See TURNPIKE. from order in proceedings to remove location of gates... 133 See TURNPIKE. appointment of toll-gatherers i31 certificate of completion of bridge ., 129 apply to commissioners of highways for, when 129 commissioners to give it, when 129 compensation therefor 1 29 by whom paid 129 to be filed in county clerk's office 129 commissioners of highways, when to give certificate of com- pletion 129 commutation of toll , 130 See TURNPIKE. consolidation 138 See TURNPIKE. 49 liXDEX. Sic. Bridge, construction or 128 good and substantial railing or siding 128 height of , 128 not over streams, where tide ebbs and flows 128 not over water navigabk bj sail vessels or steamboats. .. 128 not over water used as harbor 128 within what distance of each other 128 contract 144 See TURNPIKE. directors, not to be concerned in contracts with company ... 144 when all the stockholders to be 147 quoru m in such case 147 duties of toll-gatherers 131 exemptions from toll 130 See TURNPIKE. extension of corporate existence 151 See TURNPIKE. gates, erected when 130 rates of toll 130 how fixed 130 to be posted, where . . . . : 130 location of 133 See TURNPIKE. ordered to be thrown open, to remain open during appeal. 134 incorporation, proof of 146 See TURNPIKE. inspectors 134- See TURNPIKE. liability of company for acts of its toll-gatherers 131 after judgment against him and return of execution nulla bona 131 must keep channel of stream navigable by rafts free from deposits 128 name of, on consolidation, may be changed 138 how effected 138 notice may be maintained at end of bridge 143 See TURNPIKE. office, change of location . . . . 137 See TURNPIKE. office, location of 13? See TURNPIKE. penalty, etc o See TURNPIKE. 50 INDE*. Stc. Bridge, liability of company, penalty, etc., actions for 145 limitation of 145 for riding or driving over bridge after notice 1*3 amount of 143 for running gate 132 for unreasonably or unnecessarily delaying or hinder- ing passage 128 imposed on company for disobedience of inspector's order 134 imposed upon gate-keeper 134 See TURNPIKE. powers of toll-gatherers 131 restrictions on 121 navigable stream not to be bridged 121 nor passage of rafts of certain size to be endangered. . . . 121 restrictions upon construction J28 cannot build, over stream where tide ebbs and flows 128 water navigable by sail vessels or steamboats 128 used as harbor 128 within what distance of each other 128 service of papers on company 137 See TURNPIKE. subject to penalty for unreasonably or unnecessarily de- laying passage 128 taxation 140 as real estate 140 where taxable 140 toll-gatherers 131 See TURNPIKE. toll, rates of 130 how fixed , 130 list to be posted 130 may be commuted 130 by whom 130 for what length of time 130 who exempted from 130 person attending election 130 funeral 130 juror 130 school meeting 130 town meeting 130 trial as witness 130 worship 130 living within one mile 130 working on highway 130 troops in actual service 130 Electric light 60-70 consolidation 61 II LtfDEX. Sic. JJlectric light, consolidation, in what manner ; 61 deposit of money, as security 66 amount required, how ascertained 66 interest thereon to be paid to consumer 66 directors, number t)f 60 duration not to exceed fifty years 60 entry of building for examination, etc 67 by agent duly au thorized 67 must exhibit written authority 67 fine imposed for preventing, etc 67 incorporation of, how effected 60 certificate of 60 what to contain 60 purposes of 60 powers of.. 60 additional 61 refusal or neglect to pay rent, effect of 68 or to make deposit 68 electric light may be turned off 68 meter, etc., removed 68 supplying electric light, when bound to do so 65 distance of building 65 former indebtedness therefor must be paid . . 65 no refusal on ground of former occupant's debt 65 unless assumed 65 refusal subjects to fine 65 exceptions thereto 65 taxation, exemption from 61 for municipal purposes 61 period not exceeding three years 61 Ferry 2-6 capital stock 3, 5 affidavit of payment 3 what to contain 3 failure to pay 5 effect of 5 when to be paid 5 certificate of incorporation 2 what to contain 2 condition precedent to commencing business 3 directors, number of 2 duration of not to exceed fifty years 2 incorporation, how effected 2 powers of 4 additional 4 what it can take by grant or assignment 4 what subject to 4 schedule 6 must post, when 6 where 6 what to contain * 6 52 INDEX. SML Gas 60-70 consolidation 61 in what manner 61 deposit of money, as condition precedent 66 amount to be required 66 interest to be paid to consumers 66 deputy inspector of gas meter 63 appointment, how made 03 dutic*, defined 63 residence 63 salary 63 by whom paid 63 term of office 63 directors, number of 60 duration, not to exceed fifty years 60 entry of building for examination, etc 67 by agent duly authorized 67 must exhibit written authority 67 fine imposed for preventing, etc 67 gas-meters, inspection of 64 none to be used without inspection, etc 64 except in certain cases 64 testing apparatus to be kept by company 64 when meter tested 64 who to pay therefor 64 illuminating power, in certain cities 70 how measured 70 incorporation, how effected 60 certificate of 60 what to contain 60 purposes of 60 inspector of gas meters 62 appointment, how made .... 62 duty, defined , 62 removal - 62 residence 62 salary 62 how paid 62 term of office 62 neglect or refusal to pay rent, effect of 68 or to make deposit 68 gas may be turned off 68 meter, etc. , removed 68 price of gas in certain cities 70 powers of 61 additional , 61 rent for meters, none to be charged 69 penalty therefor 69 how and where recovered 69 part of corporate funds ... 69 supplying gas, when bound to do so 65 53 INDEX. r 8HL Gas, supplying, distance of building 6d former indebtedness therefor must be paid 65 no refusal on ground of former occupant's debt. 65 unless assumed 65 refusal subjects to fine 65 exceptions thereto 65 Navigation . 10-13 capital stock 12 certificate of payment 12 by whom executed 12 to be filed " 12 what to contain 12 when recorded 12 where recorded 12 capital stock, amount of 10 certificate of incorporation 10 certificate, supplemental 11 effect of 11 to extend business 11 to file from time to time 11 what to contain 11 directors, number of 10 incorporation - 10 number of persons required 10 purposes 10 term of existence 10 limitation of this article 13 railroad corporation not to own or hold any stock 10 stock of, not to be owned or held by railroad corporation .... 10 Pipe line 40-54 canals, conditions of crossing, etc 44 capital stock, amount of 40 cities, construction of, through 46 not without resolution of common council 46 pavements, removal of 46 to replace, company must give bond 46 suit therefor to be brought by common council 46 city officers, when may grant lauds 48 commissioners to relocate line 41 application for 41 appointment how , 41 to what court 41 in what district 41 who may make, 41 proceedings before 41 report of 41 consent of local authorities 45 application to supreme court, when not given, for per- mission 45 on petition and notice 45 county officers, when may grant lauds 48 54 INDEX. SKI. Pice line, creeks, conditions of crossing, etc 44 directors, number of 40 fences, not required to maintain. 53 rights of adjoining owner in such case 53 trespass, when not liable for 53 when built, must provide crossings, etc 53 no claim for contribution for division fence 53 when not built, adjoining owner may build 54 liability of company in such case 54 gas-house, not to be erected in cities without corporate consent. 46 highway, how to be crossed 43 compensation, how to be made 43 exclusive title or use, not acquired 43 pipes not to run along or under its lands 43 Incorporation of 40 certificate of 40 contain what 40 indorsement or attachment to 40 number of persons required 40 Indian reservation, construction over 47 contract with chiefs 47 effect of contract 47 must be ratified by county court. 47 liability as common carriers , 50 location of line 41 how to be marked before proceeding to construct or con- demn 41 map and survey to be made , 41 how certified 41 where filed 41 written notice of filing 41 to be given c .. 41 to whom 41 what to contain 41 monthly statement to be made 52 verified, how = 52 by whom 52 what to contain 52 when made 52 where filed and posted 52 order of court on commissioners' report 41 pipes, to carry petroleum, gas, etc., when prohibited 42 care in locating them , 42 consent of majority of property-owners, necessary 42 plankroad, how to be crossed 43 compensation, how to be made 43 exclusive title or use not acquired 43 pipes not to run along or under its land 43 powers 49 additional 49 to cause examinations and surveys to be made 49 55 INDEX. SE&, Pipe line, powers to enter upon lands, etc 49 to lay out its pipe line route, etc <,.,... 49 to regulate time, manner and terms of transportation. . . 49 to take and convey, through pipes, property, etc 49 . to take and hold voluntary grants, etc 49 proceedings before commissioners, expenses of 41 how enforced 41 proceedings for condemnation, when to be commenced. . . 41, 42 property received for transportation, conditions of delivery. 51 railroad, how to be crossed 43 compensation, how to be made 43 exclusive title or use not acquired 43 pipes not to run along or upon its lands 43 rates and charges to be fixed by general rules 50 printed or written 50 publicly exposed 50 receipt, certificate or order/ when not to be made, accepted or issued 51 not to be used again, when 51 risers, conditions of crossing, etc 44 shares of stock, amount of, to be taken 40 state lands, construction over 48 commissioners of land office may grant lands. 48 terms may be agreed upon 48 title may be acquired by condemnation 48 storage, may provide receptacle for 50 taxation 55 assessed how 55 assessed where 55 payment or commutation of 55 town officers, when may grant lands 48 turnpike, how to be crossed 43 compensation, how to be made 43 exclusive title or use not acquired 43 pipes not to run along or under its land 43 use of line to be public 50 villages, construction of, through 46 not without resolution of trustees . 46 vouchers to be canceled and filed 51 how canceled 51 when authority of public officers necessary 42 when consent of owner necessary 42 written and acknowledged 42 when line not to be laid across or upon public highway, turn- pike or plankroad 42 when line not to be located or constructed through or under building, dooryard, lawn, garden or orchard 42 work of construction, when to commence 41 Plaukroad , 1 20-151 See TURNPIKE. 5G INDEX. SBC. Plankroad, abandonment, how effected after extension of corpo- rate existence 151 appeal from decision of assessors as to exemption claim.. . .. 140 See TURNPIKE. from order of inspectors to throw gates open 134 See TURNPIKE. from order in proceedings to remove location of gate. . . . 133 See TURNPIKE. appointment of toll-gatherers 131 branches 135 certificate of completion of road 129 or of five consecutive miles thereof. 129 application to commissioners of highways therefor 129 commissioners to give it when 129 compensation therefor 129 by whom paid 129 to be filed in county clerk's office 129 change of route 135 See TURNPIKE. commissioners of highway, when to give certificate of com pletion 129 commutation of toll 130 See TURNPIKE. consolidation .' 138 See TURNPIKE. construction of road 127 of what material 127 how built 127 to be secure and permanent 127 vehicles, etc., to be enabled to pass 127 width 127 contract 144 See TURNPIKE. contractor 144 See TURNPIKE. contract with connecting turnpike road 126 to purchase road or part thereof 126 stock 126 directors, after purchase of connecting turnpike 126 shall be directors of such turnpike 126 manage its affairs 126 render annual account 126 not to be concerned in contracts with company 144 quorum in such case 147 when all the stockholders to be 147 discontinued road, or path thereof, becomes public highway. 148 dissolution of, after purchase of connecting turnpike 126 shareholders to be stockholders in such turnpike 126 in what proportion ,...,,,, 57 Bw Plankroad, dissolution of, stock of turnpike, how to be divided.. 126 scrip to be issued for 126 dissolution of 143 See TURNPIKE. duties of toll-gatherers 131 encroachment of fences, etc. , on road 142 See TURNPIKE. exemption from toll 130 See TURNPIKE. extension of corporate existence 151 See TURNPIKE. extension of route 135 gates, etc 130 See TURNPIKE. gates, location of 133 See TURNPIKE. gates ordered to be thrown open, to remain open during ap- peal 134 guide-post to be erected 136 See TURNPIKE. highway labor upon line of road 150 See TURNPIKE. hoist-gates not .to be erected on road 136 incorporation, proof of 146 See TURNPIKE. inspectors ,- 134 See TURNPIKE. inspectors to order removal of encroachment, when 142 iron rails may be laid on its road 127 for what vehicles. 127 what motive power used thereon 127 liability of company for acts of its toll-gatherers 131 See TURNPIKE. may relay its road with other material 127 what kinds 127 mile-stone to be erected and maintained 136 See TURNPIKE. name of, on consolidation, may be changed 138 how effected 138 notice may be maintained at end of bridge .... ] 43 office, location of 137 See TURNPIKE. office, change of location 137 See TURNPIKE, penalty, actions for 145 limitation of , 145 penalty, etc See TURNPIKE. 58 INDEX. SBC Plankroad, penalty, etc., for injuring mile-stone, guide-post or road 136 penalty for injuring road, etc 14i See TURNPIKE. for refusal or neglect to remove encroachment after notice from inspectors 142 for riding or driving over bridge after notice 143 amount of 143 for running gate 132 imposed on company for disobedience of inspector's order 134 imposed on gate-keeper 134 powers of toll-gatherers 131 public highway, when road to become 148 reversion of road and property on surrender 139 to whom 139 sale of property and franchise 138 See TURNPIKE. service of papers on company 137 See TURNPIKE. surrender . 139 See TURNPIKE. taxation, exemption from 140 See TURNPIKE. toll-gatherers , , 131 See TURNPIKE. toll, rates of 130 See TURNPIKE. town must pay for lands not originally a highway, when .... 149 See TURNPIKE. re coach 20-22 capital stock, amount of 20 certificate of incorporation 20 what to con tain 20 directors, number of 20 incorporation of, how effected 20 number of persons required 20 purposes ot : 20 powers of. 22 additional 22 to erect and maintain necessary buildings 22 to take and convey persons and property 22 route, alteration of 21 extension of 21 how effected 21 Telegraph 100-105 affidavit of directors to amended certificate 101 amended certificate must be filed, when 101 contain what 101 how verified 101 61 INDEX. SBC. Telegraph, certificate of incorporation 101 by whom made 101 contain what 101 how verified 101 must be filed 101 condemnation, to acquire right to construct by 102 when cannot agree with owner 102 consolidation 104 acquire by purchase, etc., property of other such corpora- tion 104 dispose of property to other such corporation 104 ratified to be valid 104 in what manner 104 stock of purchasing corporation may be taken in pay- ment 104 consent of stockholders, when required 101 construction of lines 102 compensation for rights taken 102 how ascertained 102 over or through any land 102 over or under any public roads, etc 102 over or under any waters 102 dispatches, transmission of 103 order of sending ; 103 payment of what charges 103 refusal to send subjects to fine , 103 directors, number of 100 extension of lines, how effected 101 amended certificate must be filed 101 contains what 101 how verified 101 consent of persons owning two-thirds of capital stock.. 101 director's affidavit on or to certificate 101 incorporation, how effected 100 certificate of 100 what to contain 100 number of persons, required 100 purposes stated 100 lands, construction of lines over or through 102 subject to right of full compensation 102 how ascertained 102 may acquire property of other like corporation 104 dispose of property to other like corporation 104 in what manner 104 neglect or refusal to send dispatch 103 either for usual rates 103 in regular order 103 or with impartiality 103 penalty to be paid to sender 103 not limited wholly to this state 100 order of sending dispatches 103 60 INDEX. BM Telegraph, order of sending dispatches, exception in favor of newspaper publishers or proprietors 103 penalty for refusal or neglect to send 103 for usual charges . 103 in regular order 103 or with impartiality 103 to whom paid 103 policemen, special 105 appointment, by whom 105 how made 105 duties of 105 powers of 105 qualifications of 105 revocation of 105 salary 105 by whom paid 105 uniform, etc 105 public roads, streets and highways 102 right to construct lines over or under 102 subject to compensation 102 how ascertained 102 stock of another corporation, when taken 104 transmission of dispatches 103 from whom to receive 103 impartially and in good faith 103 in order in which received 103 exceptions made 103 on payment of usual charges 103 refusal or neglect subjects to fine 103 amount of fine 103 water within limits of state 102 right to construct lines through, across or under 102 subject to compensation 102 how ascertained 102 Telephone 100-105 See TELEGRAPH. Title, act to be known by 1 Tramway 30-33 certificate of incorporation 30 what to contain 30 condemnation, may acquire land by 32 crossing over railroad, highway, turnpike, plankroad, or canal not to interfere with free use directors, number of incorporation of 30 number of persons required 30 purposes of 30 powers of additional to cause examinations and surveys to be made. .... 31 61 INDEX. Sao. Tramway, powers of, additional, to erect and maintain necessary buildings 31 to lay out tramway 31 Turnpike 120-151 abandonment 139 See SURRENDER. abandonment, how effected after extension of corporate exist- ence 151 actions for penalty 145 limitation of 145 agreement to use highways 122 how made 122 with whom 122 appeal from decision of assessors as to exemption claim 140 county judge's decision final 140 proceedings on 140 appeal from order, in proceeding to remove location of gate. 133 how taken 133 to general term of supreme court 133 referees, appointment of 133 duties of * 133 fees 133 hearing before 133 report of ; 133 supreme court to award judgment 133 with costs to successful party 133 appeal from order of inspectors to throw open gates 134 notice of appeal 134 proceedings on 134 service of 134 time within which taken 134 to what court 134 application to board of supervisors to acquire land 123 in case it cannot be procured by gift, purchase or agree- ment 123 it must be made to boards of what counties 123 may be made at annual or special meeting 123 how special meeting called ' 123 notice thereof, how served 123 who to pay expenses thereof 123 notice of application published 123 for what time 123 in what newspaper 123 what to contain 123 persons interested may appear on the hearing 123 property-owners may appear 123 what may be done on hearing 123 appointment of toll-gatherers 131 board of supervisors, application to 123 at annual or special meeting 123 may adjourn such meeting , 123 62 INDEX. / fart. Turnpike, board of supervisors, may take testimony 123 or authorize its committee to take it 123 order of board on such application 123 where recorded 123 branches 135 See TUENPIKE. capital stock, amount of 120 payment of , 120 certificate of incorporation , 120 contain what i'acts.. 120 director's affidavit to be indorsed or annexed 1-iO how executed 120 filed 120 certificate of completion of road 129 or five consecutive miles thereof 129 application to commissioners of highways therefor 129 commissioners to give it, when 129 compensation therefor 129 by whom paid. : 129 to be filed in county clerk's office 129 change of route 135 consent of whom, necessary 135 how made 135 land for, how acquired 135 right to enter upon, for survey, etc 135 survey to be made, when 135 how certified 135 where filed , 135 commissioners of highways, when to give certificate of com- pletion 129 commissioners to lay out road 124 appointment of, by whom. , 124 who qualified 124 compensation 124 constitutional oath of office must be taken 124 duties of 124 must hear all interested persons 124 take testimony in relation thereto 124 shall cause survey and description to be recorded. . 124 in what office 124 commutation of toll 130 by whom 130 for what length of time 130 condemnation to take highway 122 compensation 122 to be paid to whom 122 to be used, how 122 consolidation 1 on what terms 138 persons owning two-thirds of stock to determine ] construction of road 127 INDEX. SBC. Tnrnpike, construction of road, of what material. 127 how built .' 127 to be secure and permanent 127 vehicles, etc., to be enabled to pass 127 width 127 contract with plankroad to sell its road, when 126 or part thereof. 126 or stock 127 new, cannot be made by contractor with company, with- out approval of board, etc. 144 contractor cannot make new contract, etc., without approval of board, etc. , . ". 144 conveyance of property and franchises 138 See SALE. directors, affidavit of 120 number of 120 not to be concerned in contracts with company 144 when all the stockholders to be 147 quorum in such case .- 147 discontinued road, or part thereof, becomes public highway.. 148 dissolution of 148 by legislature, when 1 48 effect of 148 laches in proceeding to begin, complete or rebuild, etc. , 148 neglect or omission to exercise franchise 148 road to become public highway t 148 duration, not to exceed fifty years 120 duties of toll-gatherers ,. 131 encroachment of fences, etc., on road 142 how removed 142 notice of, by whom: 142 to whom , 142 order of removal by inspectors 142 not to be made, when 142 penalty for refusal or neglect to remove after notice. . . . 142 wnat notice 142 exemptions from toll 130 person attending as juror 130 person attending as witness 130 person attending election 130 person attending funeral 130 person attending school meeting 130 person attending town , 130 person attending worship 130 person living within one mile, when 130 working on highway 130 troops in actual service 130 extension of corporate existence 151 requirements additional to provisions of general corpora- tion law 151 64 INDEX. 8 BO. Turnpike, requirements, resolution of board of supervisors neces- sary 151 verified statement .of president, etc 150 written consent of two-thirds of stockholders 150 extensions of route. , 135 See CHANGE OF ROUTE. gates, erected when 130 rates of toll 130 location of , . . . 133 not within ten rods of building 133 without consent of owner 133 removal of building 133 application, by whom 133 order. 133 removal of location of gate 133 application, by whom 133 on what notice 133 to what court 133 hearing, how conducted 133 order, now enforced 133 appeal from 133 how taken 133 proceedings on 133 ordered to be thrown open, to remain open during appeal 134 gate, running, penalty for . . , 132 guide-post to be erected 136 at what places 136 how inscribed 136 penalty for injuring 136 highway labor upon line of road 150 adjoining owner may be assessed for labor thereon, when. 150 course of proceeding necessary 150 director, to whom list delivered, to be vested with duties and powers of overseer 150 highway commissioner to deliver list to one of directors. 150 person assessed may commute 150 terms of 150 highways 122 agreement to use ... 122 consent of two-thirds of adjoining owners necessary. 122 made with what officers 122 recorded and filed, where 122 condemnation 122 payment of compensation 122 to be made to whom 122 to be used, how 1 22 hoist-gates, not to be erected on road 136 incorporation of, how effected 120 certificate of 120 contain what 120 indorsement thereon 120 65 INDEX. BBC Tnrnpike, incorporation of, number of persons required 120 purposes stated 120 proof of 146 parol proof, when sufficient 146 title to road duly set up by opposing party requires other proof 146 inspectors, to order removal of encroachment, when 142 inspectors 134 duties of 134 to examine road within district once a month 184 part of road on complaint 134 to give written notice to gate attendant of want of repair 134 to which attendant 134 what notice to contain 134 to order gate, if default in repairing, to be thrown open 134 ] fees of 134 by whom paid 134 penalty for neglect of duty 134 powers of 134 who to be 134 iron rails may be laid on its road 127 for what vehicles . 127 what motive power used thereon 127 liability of company for acts of its toll-gatherers 131 after judgment against him and return of execution nulla boua 131 limitation of actions for penalty 145 location of gates 133 See GATES, LOCATION OF. location of road .... 121 restrictions upon 121 when not through buildings 121 garden 121 orchard 121 yard, etc ... 121 without consent of owner 121 mile-stone to be erected and maintained 136 each mile of road 136 marked plainly with distance 136 also with continuance of preceding road 136 penalty for injury 136 name of, on consolidation, may be changed 138 how effected J38 notice may be maintained at end of bridge 143 in what cases 143 size 143 to contain what 143 of application to board of supervisors to be published. . . 123 contain what 123 66 INDEX. AM Turnpike, notice may be maintained at end of bridge, for what length of time 123 in what newspaper 123 office, change of location 137 how effected 137 notice to contain what 137 when and where published 137 where filed i 137 location of 137 must designate some place 137 when 137 where , 137 public notice thereof must be published. , 137 how long 137 where 137 where filed 137 officers of, after dissolution or purchasing plankroad 126 how chosen 126 number of 126 owner of land incapable of selling 125 when name and residence cannot be ascertained 125 who cannot agree for sale 125 owning road on or adjoining plankroad , 126 when may abandon such portion of road 126 payment for land, on dissolution, must be made by town, when. 149 penalty, actions for 145 limitation of , . . 145 for injuring mile-stone, guide-post, or road 136 for injuring road, etc., by diverting stream, etc 141 by drawing, etc., logs, etc., thereon 141 by obstructing, etc 141 amount of 141 for refusal or neglect to remove encroachment after no- tice from inspectors 142 for riding or driving over bridge after notice 143 amount of 143 for running gate 132 for unauthorized act of toll-gatherers 131 imposed on company for disobedience of inspectors order 143 imposed on gate keeper 134 for disobedience of inspectors' order 134 for hindering or delaying person in passing 134 for taking tolls, when gate to be open 134 possession of and title to real estate 125 by condemnation, when 125 how acquired, when owner incapable of selling 125 when name or residence cannot be ascertained 125 powers of toll-gatherers 131 proof of incorporation 146 See INCORPORATION", PROOF OP. 67 INDEX. BML Turnpike, public highway, when road to become .. 148 reversion of road and property on surrender 139 tc svhom 139 running gate, penalty for 132 sale of property and franchise 138 effect of 138 how effected 138 to what company 138 service of papers on company 137 between what hours 137 how made 137 not on Sunday or legal holiday 137 upon what person 137 stock, company may sell to plank road, when 126 held, after sale, for whose benefit 126 in what proportion 126 transfer of stock so acquired 126 transferee, righ ts of 126 stockholders of, after dissolution of purchasing plankroad. . 126 stock, how deemed divided 126 scrip to be issued therefor 126 surrender 139 consent, in writing of stockholders 139 declaration in writing ." 139 both to be filed 139 how attested and acknowledged 139 where filed 139 effect of 139 iurvey and description to be signed, acknowledged and re- corded 124 by whom .- 124 in what office 124 to be separate as to portion in each county 124 taxation, exemption from 140 what is exempt 140 until what time 140 toll-gatherers 131 appointment of 131 duties of 131 liability of company for 131 penalty for unauthorized act 131 powers of 131 toll, rate of 130 how fixed 130 list to be posted 130 may be commuted 130 by whom 130 for what length of time 130 on divergent road striking turnpike near gate 130 who exempted from 130 Dersoiis attending as juror 130 68 INDEX. 810. Turnpike, toll, rate of, who exempted from : persona attending as witnesses 130 election 130 funeral 130 school meeting 13t) town meeting 130 worship 130 living within one mile 130 working on highway 130 troops in actual service 130 town must pay for lands not originally a highway, when.. . 149 in case of judgment of ouster or dissolution 149 termination by limitation of time 140 payment, amount of 149 made to whom, when 349 provision therefor in judgment 149 release and conveyance to be executed 149 use of turnpike road by plank road 126 not without its consent 126 unless to cross same 126 Waterworks 80-85 amended certificate, when it may be filed 85 contents 85 effect 85 canal and canal reservoirs, no water to be taken from. ...... 84 condemnation of real property 84 for what purposes 84 in what case 84 contract with other towns or villages 85 can be made, when 85 company must file amended certificate 85 what it must contain o ....... 85 incorporation of 80 certificate of 80 what to contain 80 permit of municipal authorities 80 who must execute it 80 proof of subscription and payment of capital stock 80 must supply water 81 to all consumers 81 powers of 82 additional 82 defined 81 rights of, defined 84 streams used to supply canals, no water to be taken from. ... 84 village authorities have power to contract 81 for what purposes 8-1 limitation of contract 81 payment, how made 81 term of contract, how extended 81 to what extent 81 69 CONDEMNATION OF REAL PBOPERTI SALE OF CORPORATE REAL PROPERTY. 3STOTES -A.2STID CHAJP. 95 of 189O. CODE OF CIVIL PROCEDURE. CHAPTER XXIII. SUPPLEMENTAL PROVISIONS. TITLE I. PROCEEDINGS FOR THE CONDEMNATION OF REAL PROPERTY. TITLE II. PROCEEDINGS FOR THE SALE OF CORPORATE REAL PROPERTY. TITLE I. PROCEEDINGS FOR THE CONDEMNATION OF REAL PROPERTY. SECTION 3357. Title. 3358. Terms defined. 3359. When proceedings prescribed in this title to be taken. 3360. Proceedings to be commenced by petition; what to contain. 3361. Notice to be annexed to petition ; upon whom served. 3362. Petition and notice ; how served. 3363. Appearance of defendant infant, idiot, lunatic or habitual drunkard. 3364. Appearance of parties. 3365. Answer ; what to contain. 3366. Petition or answer must be verified 3367. Trial of issues. 3368. Certain provisions made applicable. 3369. Judgment what to contain ; costs when to defendant ; commissioners. 3370. Proceedings of commissioners. 3371. Confirming or setting aside report; deposit when payment. 3372. Offer to compromise ; amount of costs ; additional allowance. 3373. Judgment how enforced ; when to deliver possession of premises and when writ of assistance to issue. 3374. Abandonment of proceeding. 3375. Appeal from final order; stay. 337(5. Appeal from judgment by plaintiff. 337^. New appraisal ; when. 3378. Conflicting claimants. 3379. Possession of property on giving security. SUPPLEMENTAL PROVISIONS. 3380. When possession of real property given immediately. 3381. Notice of pendency of action to be filed. 3382. Practice in cases not provided for. 3383. Repealing clause. 3384. When act to take effect. 3357. Title. This title shall be known as the condemnation law. 3358. Terms defined. The term " person," when used herein, includes a natural person and also a corporation, joint-stock association, the state and a political division thereof, and any commission, board, board of managers or trustees in charge or having control of any of the charitable or other institutions of the state ; the term " real property," any right, interest or easement therein or appurtenances thereto ; and the term " owner," all persons having any estate, interest or easement in the property to be taken, or any lien, charge or incumbrance thereon. The person instituting the proceedings shall be termed the plaintiff ; and the person against whom the proceeding is brought, the defendant- fAm'd by ch. 589 of 1896. In effect May 12, 1896.J The right of a mill owner to use the waters of a stream as a propelling power at his mill, is an incorporeal hereditament connected with the land and may be acquired by a water-works company. Stamford Water Co. 1). Stanley, 39 Hun, 424. 3359. When proceedings prescribed in this title to be taken. Whenever any person is authorized to acquire title to real property, for a public use by condemnation the proceedings for that purpose shall be taken in the manner prescribed in this title. The propriety of taking private property for a public use, is not a judicial question, but one of political sovereignty, to be determined by the legislature, either directly or by delegating the power to public agents, proceeding in such a manner and form as it may prescribe. People ex rel. Herrick ?>. Smith, 21 N. Y., 595. Neither a private or municipal corporation can under a general power to take lands for a public use, take from another corporation having the like power, lands or property held by it for a public purpose pursuant to its charter. Matter of Rochester Water Commissioners, 66 N. Y., 413. See also, to same effect, Prospect Park & C. I. R. R. Co. v. Williamson, 91 N. Y. 552. Statutes delegating the right of eminent domain to railroad and other corpora- tions, being in derogation of common right, are not to be extended by implication, and must be strictly complied with. Yet they are not to be construed so literally, as to defeat the evident purposes of the legislature. N. Y. &H. R. R. Co. v. Kip< 46 N. Y., 546. 3360. Proceedings to be commenced by petition ; what to contain. The proceeding shall be instituted by the presentation of a petition by the plaintiff to the supreme court setting forth the follow ing facts : 1. His name, place of residence, and the business in which engaged ; if a corporation or joint-stock association, whether foreign or domestic, its principal place of business within the state, the names and places of residence of its principal officers, and of its directors, trustees or board of managers, as the case may be, and the object or purpose of its incorporation or association ; if a political division of the state, the names and places of residence of its principal officers ; and if the state 2 SUPPLEMENTAL PROVISIONS. or any commission or board of managers or trustees in charge or having control of any of the charitable or other institutions of the state, the name, place of residence of the officer acting in its or their behalf in the proceedings. [Am'd by ch. 589 of 1896. In effect May 12, 1896.] 2. A specific description of the property to be condemned and its location, by metes and bounds, with reasonable certainty. 3. The public u^e for which the property is required and a concise statement of the facts showing the necessity of its acquisition for such use. 4. The names and places of residence of the owners of the property ; if an infant, the name and place of residence of his general guardian, if he has one , if not, the name and place of residence of the person with whom he resides ; if a lunatic, idiot, or habitual drunkard, the name and place of residence of his committee or trustee, if he has one ; if not, the name and place of residence of the person with whom he resides. If a non-resident, having an agent or attorney residing in the state authorized to contract for the sale of the property, the name and place of residence of such agent or attorney ; if the name or place of residence of any owner can not after diligent inquiry be ascertained, it may be so stated with a specific statement of the extent of the inquiry which has been made. 5. That the plaintiff has been unable to agree with the owner of the property for its purchase and the reason of such inability. 6. The value of the property to be condemned. 7. A statement that it is the intention of the plaintiff, in good faith, to complete the work or improvement, for which the property is to be condemned ; arid that all the preliminary steps required by law have been taken to entitle him to institue the proceeding. 8. A demand for relief, that it may be adjudged that the public use requires the condemnation of the real property described, and that the plaintiff is entitled to take and hold such property for the public use specified, upon making compensation therefor, and that commissioners of appraisal be appointed to ascertain the compensation to be made to the owners for the property so taken. When private property is to be taken for public purposes, facts necessary to give the court or officer jui-isdiction must appear in the petition, for it is upon that alone that jurisdiction depends. Matter of Marsh, 71 N. Y., 315 ; rev'g 10 Hun, 49. The supreme court has the power to entertain a proceeding on the petition of a railway, to condemn lands of the state under water. Matter of N. Y. Cable Co., 104 N. Y., 1, 43. It is no objection to proceedings under the act that there are other lands in the same vicinity equally well adapted for the purposes which possibly might be acquired by purchase'. N. Y & H. R. R. Co. v. Kip, 46 N. Y., 546. The reasons of the inability to agree must he stated, that the court may determine their sufficiency, and als=o that. th owner of the land may negative or disprove them, as the reasons why asrrppmpnt, ran not be had may be various, and a petition which fails to state the reasons for disagreement is defective. Matter of Marsh, 71 N. Y., 316. The exercise of the power being in derogation of individual right, allowed only SUPPLEMENTAL PROVISIONS. when the necessity clearly appears, and the proposed use is clearly embraced within the legitimate objects of the power. In re Staten Island Rapid Transit Co., lu.i N. Y., 251. A defective description can not be remedied by reference to a desciption in a deed. Extreme accuracy is essential for the protection of the rights of all the parties, and a failure to comply with the statute must lead to difficulty and embarrassment. Matter of N. Y. C. & H. R. R. R. Co., 70 N. Y., 191. In Matter of Suburban Rapid Transit Co., 38 Hun, 553, it was held, that the court had power to amend a defect in the petition by proof presented upon the hearing. One petition to acquire the land of several owners is but one proceeding, and requires one appeal and one allowance of costs. Matter of Prospect Park, etc., R. R. Co., 67 N. Y., 371 ; affirming 8 Hun, 30. . In order to sustain proceedings by which a body corporate claims the power to exercise the right of eminent domain, it is not sufficient that it be a corporation de facto. It must be a corporation de jure. Matter of N. Y. Cable Co., 104 N. Y., 1, 43. If the petition does not show the facts required by statute to be stated, the objection may be disposed of before trial. Matter of N. Y. W. S. & B. R. R. Co., 64 How., 217. Owner intitled to notice and hearing. Stuart v. Palmer, 74 N. Y., 183. 3361. Notice to be annexed to petition; upon whom, served. There must be annexed to the petition a notice of the time and place at which it will be presented to a special term of the supreme court, held in the judicial district where the property or some portion of it is situated, and a copy of the petition and notice must be served upon all the owners of the property at least eight days prior to its presentation. All notices and hearings that may tend to give the party to be affected any semblance of benefit must be carefully observed. People v. Kniskern, 54 N. Y , 52. 3362. Petition and notice ; how served. Service of the peti- tion and notice must be made in the same manner as the service of a summon in an action in the supreme court is required to be made, and all the provisions of articles one and two of title one of chapter five of this act, which relate to the service of a summons, either personally or in any other way, and the mode of proving service, shall apply to the service of the petition and notice. If the defendant has an agent or attorney residing in this state, authorized to contract for the sale of the real property described in the petition, service upon such agent or attorney will be sufficient service upon such defendant. In case the defendant is an infant of the age of fourteen years or upwards, a copy of the petition and notice shall also be seived upon his general guardian, if he has one ; if not, upon the person with whom he resides. S 3363. Appearance of defendant infant, idiot, lunatic or habitual drunkard. If a defendant is an infant, idiot, lunatic or habitual drunkard, it shall be the duty of his general guardian, com- mittee or trustee, if he has one, to appear for him upon the presenta- tion of the petition and attend to his interests, and in case he has none, or in case his general guardian, committee or trustee fails to 4 SUPPLEMENTAL PROVISIONS. appear for him, the court shall, upon the presentation of the petition and notice, with proof of service, without further notice, appoint a guardian ad litem for such defendant, whose duty it shall be to appear for him and attend to his interests in the proceeding, and, if deemed necessary to protect his rights, the court may require a general guar- dian, committee or trustee, or a guardian ad litem to give security in such sum and with such sureties as the court may approve. If a ser- vice other than personal has been made upon any defendant and he does not appear upon the presentation of the petition, the court shall appoint some competent attorney to appear for him and attend to his interests in the proceeding. 3364. Appearance of parties. The provisions of law and of the rules and practice of the court, relating to the appearance of parties in person or by attorney in actions in the supreme court, shall apply to the proceeding from and after the service of the petition, and all subsequent orders, notices and papers may be served upon the attorney appearing and upon a guardian ad litem in the same manner and with the same effect as the service of papers in an action in the supreme court may be made. A party, by putting in a general appearance and proceeding without objection submits himself to the jurisdiction of the court, and can not afterward raise objec- tion to the sufficiency of the verification to the petition. Lackawanna, etc., R. R. Co. v. Scheu, 33 Hun, 148. If the petition does not state the facts required in the petition to be stated, an objection in that regard can be raised preliminarily in effect by way of demurrer, and should be disposed of before proceeding to the merits. Matter of N. Y., W. 8. & B. R. R. Co., 64 How., 217. The appearance of an attorney for the land owner, when a petition for the appointment of commissioners is brought on for hearing, gives jurisdiction, and flures an omission from the petition, such as the omission to state the residence of owners. Matter of Rochester, Hornellsville, etc., Ry. Co., 19 Abb. N. C., 421. 3365. Answer ; what to contain. Upon presentation of the petition and notice with proof of service thereof, an owner of the property may appear and interpose an answer, which must, contain a general or specific denial of each material allegation of the petition controverted by him, or of any knowledge or information thereof sufficient to form a belief, or a statement of new matter constituting a defense to the proceeding. If by non-performance of a condition of its charter, the corporation has forfeited or lost its corporate rights and powers the fact may be averred by any one whose land or property is sought to be appropriated in answer to the application. Matter Of Brooklyn, etc., R. R. Co., 72 N. Y., 245. It is well settled in this state, that the mere fact that the land proposed to be taken for a public use is not needed for the present and immediate purpose of the petitioning party, is not necessarily a defense to a proceeding to condemn it. Matter of Staten Island Rapid Transit Co., 103 N. Y., 251. 3366. Petition or answer must be verified. A petition or Answer must be verified, and the provisions of this act relating to th 5 SUPPLEMENTAL PROVISIONS. form and contents of the verification of pleadings in courts of record, and the persons by whom it may be made, shall apply to the verification. 3367. Trial of issues. The court shall try any issue -raised by the petitiuii and answer at such time and place as it may direct, or it may order the same to be referred to a referee to hear and determine, and upon such trial the court or referee shall rile a decision in writing, or del ver the same to the attorney for the prevailing party, within twenty days after the final submission of the proofs and allegations of the parties, and the provisions of this act relating to the form and contents of decisions upon the trial of issues of fact by the court or a referee, and to making and filing exceptions thereto, and the making and settlement of a case for the review thereof upon appeal, and to the proceedings which may be had, in case such decision is not filed or delivered within the time herein required, and to the powers of the court and referee upon such trial, shall be applicable to a trial and decision under this title. A denial of the intention of a railroad company to, in good faith, construct and finish its road, made by the owner of the property sought to be- taken, raises an issue for trial before commissioners can be appointed, and puts the burden of proof upon the company. 'Matter of Staten Island Rapid Transit R. R., 20 Week, Dig., 15. 3368. Certain provisions made applicable. The provisions of title one of chapter eight of this act shall also apply to proceedings had under this title. 33W. Judgment- -what to contain; costs when to defend. ant commissions. Judgment shall be entered pursuant to the direction of ihe court or referee in the decision filed. If in favor of the defendant the petition shall be -dismissed, with costs to be taxed by tbe clerk at the same rates as are allowed, of course, to a defend- ant prevailing in an action in the supreme court, including the allow- ances lor proceedings before and after notice of trial. If the decision i.s in favor of the plaintiff, or if no answer has bef n interposed and it appears from the petition that he is entitled to the relief demanded, judgment shall be entered, adjudging that the condemnation of the i-'-al property described is necessary for the public use, and that the plaintiff is c'ntitled to take and hold the property for the public use specified, upon making compensation therefor, and the court shall thereupon appoint three disinterested and competent freeholders, residents of the judicial district embracing the county where the real property, or some part of it, is situated, or of some county adjoining such judicial district, commissioners to ascertain the compensation to be made to the owners for the property to be taken for the public use specified, and fix the time and place for the first meeting of the com- missioners. Provided, however, that in any such proceeding insti- tuted within the first or second judicial district, such commissioners shall be residents of the county where the real property, or some part of it, is situated, or of some adjoining county. If a trial has bcrn had, at least eight days' notice ol such appointment must be given to all the defendants who have appeared. The parties may waive, itf 6 SUPPLEMENTAL PROVISIONS.' writing, the provisions of this section as to the residence of the com- missioners, and in that case they may be residents of any county in the Stale. Where owners of separate properties are joined in the same proceeding, or separate properties of the same owner are to be con- demned, more than one set of commissioners may be appointed. Am'd by chap. 530 of 1895. Took effect May 3, 1895. Inability to procure the assent of the landholders is the only prerequisite under the statute to the appointment of commissioners. An application for the appoint- ment of commissioners should not be denied because other companies having coincident routes have refused their consent. Matter of Thirty- fourth Street R. R. Co., 102 N. Y., 343. Where commissioners were appointed on consent of parties, and it subsequently appeared one of them was not a freeholder, it was held that, in the absence of allegations of improper conduct on his part, the court properly denied a motion, made by one of the parties who had consented to his appointment, to have the report set aside and a new commissioner appointed. N. Y., W. 8. & B. R. R. Co., 35 Hun, 575. The appointment of a son of a commissioner a station agent by the company pending the proceedings is ground for setting aside an appraisal. N. Y., W. S. & B. R. R. Co. v. Townsend, 36 Hun, 630. 3370. Proceedings of commissioners. The commissioners shall take and subscribe the constitutional oath of office. Any of them may issue subpoenas and administer oaths to witnesses ; a majority of them may adjourn the proceedings before them, from time to time in their discretion. Whenever they meet, exceut by appointment of the court or pursuant to adjournment, they shall cause at least eight days' notice of such meeting to be given to the defendants who have appeared, or their agents or attorneys. They shall view the premises described in the petition, and hear the proof and a legations of the parties, and reduce the testimony taken by them, if any, to writing, and after the testimony in each case is closed, they, or a majority of them, all being present, shall, without unneces- sary delay ascertain and determine the compensation which ought justly to be made by the plaintiff to the owners of the property ap- praised by them ; and, in fixing the amount of such compensation, they shall not make any allowance or deduction on account of any real or supposed benefits which the owners may derive from the pub- lic use for which the property is to be taken, or the construction of anv proposed improvement connected with such public use. But in case the plaintiff is a railroad corporation and such real property shall belong to any other railroad corporation, the commissioners on fixing the amount of such compensation, shall fix the same at its fair value for railroad purposes. They shall make a report of their proceedings to the supreme court with the minutes of the testimony taken bv them, if any ; and they shall each be entitled to six dollars for services for every day they are actually engaged in the perform- ance of their duties, and their necessary expenses, to be paid by the plaintiff; provided, that in proceedings within the counties of New York and Kings such commissioners shall be entitled to such ad- ditional compensation not exceeding twenty five dollars for every such day, as may be awarded by the court [Am'd'by chap. 384 of 1898.] The commissioners have no power to make any awards for the loss of an estab- lished business located on the land taken, nor for the machinery thtreoii a> such, though an allowance for depreciation of its value by removal is proper. Matter of Department of Public Parks, 53 Hun, 280. 7 SUPPLEMENTAL PROVISIONS. It is not error for the commissioners to receive and act upon testimony as to the value of the property for park purposes or villa sites. Ib. The corporation acquires an absolute right to the lands divested of any inchoate right of dower existing in the wife. Moore v. The Mayor of New York, 8 N. Y., 110. The commissioners should determine the compensation to be made to a widow who has dower or life estate in lands taken. Matter of William Street, 19 Wend., 678, and also the compensation to be made to the mortgagee. Matter of John Street, ib., 659. The true inquiry is, what is the fair marketable value of the whole property ; what will be the fair marketable value of the property not taken. The difference is the amount of the damages. Matter of N. Y. & W. R. R. Co., 27 Hun, 151. ( An appraisal will not be set aside as excessive unless the excess is plain and palpable on the evidence. Matter of L. & W. R. R. Co., 27 Hun, 116. The opinions of witnesses that the railroads will frighten horses, or the necessity of deviating the line of a turnpike, or the cost of diversion, or that a bridge ought to be built, or the amount of damages a turnpike company will sustain by reason of the crossing of its road, are said to be inadmissible. Troy & B. R. R. Co. . Northern Turnpike Co., 16 Barb., 100. In Trustees of College Point v. Dennett, 5 T. & C., 217, it was held upon an ap- praisal of a pond that the measure of damages was not limited to its use as a mill or ice-pond, but the owner was entitled to receive its value for any use. The commissioners must appraise the land at its actual value ; they cannot make a reservation of easements and privileges to the owner. Hill v. M. & H. R. R. Co., 7 N. Y., 152. But see, however, Ex parte H. C. & R. R. Co., 65 How., 133, where it is held that a company may petition for the appraisement only of the land required for ita road. It is competent to show, where land is taken for a specific use, as a railroad, that the land not taken is depreciated in value by the use of the land taken, and if that depreciation consists in the imposition of expense upon the owner of such lands, what that expense will be. Matter of Bloomfield, etc., Gas L. Co. v. Calkins, 1 T. & C., 549. The owner should be awarded the market price of the land already taken, and in addition thereto the depreciation in the market value of the lands remaining, as compared with their former market value. Matter of N. Y., W. S. & B. R. R., 29 Hun, 609; to the same effect. Matter of N. Y., W. S. & B. R. R. Co., 35 Hun, 260. It is the duty of the commissioners to hear any and all evidence which would be competent in a court of law on similar questions. Roch. & Syr. R. R. Co. v. Budlang, 6 How., 467 They are controlled by the established rules of evidence. Troy & B. R. R. Co. V. Northern Turnpike Co., 16 Barb., 100 ; to the same effect, Matter of Utica & C. R. R. Co., 56 Barb., 456. In proceedings by a railroad corporation to acquire a right to lay its tracks in a street or highway, the fee of which is in the owner of the adjoining land, the proper compensation is first, the full value of the land taken ; second, a fair and adequate compensation for all the injury the owner has sustained and will sustain by the making of the road over his land. Henderson v. N. Y. C. R. R. Co., 78 N. Y., 423. The amount of damages to be awarded to the tenant, is the amount which the rental value exceeds the rent reserved. Matter of the City of Buffalo, 1 Sheldon, 408. The order in which the commissioners shall proceed is a matter left entirely in their discretion. Albany Northern, etc., R. R. Co. v. Lansing, 16 Barb., 68. The party whose land is taken and who claims damages therefor, has the right to the opening and closing argument in the pi-oceedings. Matter of N. Y., L. & W. R. R. Co., 33 Hun, 148 ; affirmed without opinion 98 N. Y. 664. An error in the admission of evidence is not cured ly the certificate of one of the commissioners that it did not affect the report. Matter of N. Y., L. & W. R. R. Co., 29 Hun, 1. Errors occurring in the report of testimony are subject -to correction by such commissioners, as a proper judicial function, and within their province only. N. Y., W. S. & B. R. R. Co. v. Judson. 33 Hun. 293. Loss of business profits and good will are not substantial grounds for damages, nor are they to be considered in estimating the injury caused by the taking of land. 8 SUPPLEMENTAL PROVISIONS. Troy & B. R. R. Co. v. Northern Turnpike Co., 16 Barb., 100 ; to the same effect, N. Y., W. S. & B. R. R. Co. v. Cosack, 35 Hun, 633. When land is taken, inconveniences from noise, smoke, etc., may be taken into consideration in estimating 1 depreciation of balance. Brooklyn Park Com. v. Armstrong, 45 N. Y., 234. In estimating the damages to which a lessee of premises used for a basiness purpose is entitled, the commissioners should consider the injury to ihe proper.y as a whole; the dLTerence in value of the leasehold interest before and after the land is taken; but the willingness of the lessor to lease another piece of land sti t- able for the same purpose is not admissible. N. Y., W. S. & B. R. R. Co. 71. Bell, 28 Hun, 426. 3371. Confirming cr setting aside report ; deposit when payment. Upon filing the report, of the commissioners, any party may move for its confirmation at a special term, held in the district where the property or some part of it is situated, upon notice to the other parties who have appeared, and upon such motion, the court may confirm the report, or may set it aside for irregularity, or for error of law in the proceedings before the commissioners, or upon the ground that the award is excessive or insufficient. If the report is set aside, the court may direct a rcheaiiug before tho same commissioners, or may appoint new commissioners for that purpose, and the proceedings upon such rehearing shall be conducted in the manner prescribed for the original hearing, and the same proceedings shall be had for the confirmation of the second report, as are herein prescribed for the con- firmation of the first report. If the report is confirmed, the court shall enter a final order in the proceeding, directing that compensation shall be made to the owners of the property, pursuant to the determi- nation of the commissioners, and that upon payment of such compen- sation, the plaintiff shall be entitled to enter into the possession of the property condemned, and take and hold it for the public use speci- fied in the judgment. Deposit of the money to the credit of, or pay- able to the order of the owner, pursuant to the direction of the court, shall be deemed a payment within the provisions of this title. No title is acquired under proceedings to condemn lands for public use until the confirmation of the report of commissioners appointed to assess the damages for the taking thereof. Matter of Common Council of Brooklyn, 5 Hun, 175. It is too late to raise objections; such as, the petition is not properly verified, or that it does not appear by the petition that the company has been unable to agree with the owner of the right of way for the purchase, etc., on motion for con- firmation of the commissioner's report. N. Y. & Erie Ry. Co. v. Corey, 5 How., 177. The supreme court will not set aside an award for every technical error, where no injustice appears to have been done. N. Y. Central R. R. R. Co. v. Marvin, 11 N. Y., 276 citing Troy & Boston R. Co. v. N. P. Co., 16 Barb., 100. Th* 1 court will not disturb an appraisal for technical errors, or unless the com- missioners have clearly gone astray and disregarded legal principles. Matter of N. Y.. L. & W. R. R. Co. v. Arnott, 27 Hun,'l51 ; to the same effect N. Y., W. S. & B. R. R. Co. v. Gennet, 37 Hun, 317. Where the petitioner has fairly made out a case establishing that the premises are necessary for its use, and the company has acted in good faith and exercised a reasonable discretion, the court will not interfere. N. Y., L. & W. R. R. Co. v. Union Steamboat Co., 35 Hun, 220. Where the commissioners awarded much less than the value of the property 9 SUPPLEMENTAL PROVISIONS. taken, according to the testimony of every witness put upon the stand, it was held an arbitrary exercise of power not justified by law. N. Y., W. S. & B. R. Co. v. Yates, 18 Week. Dig., 272. An order of court confirming the report of commissioners of appraisement of damages to owners for lands taken, will not give validity to proceedings void for want of jurisdiction. Matter of Carlton St., 16 Hun, 497. In caye commissioners have filed their report, their power of amendment is gone, and a subsequent report has 1:0 validity. People ex rel. Mann v. Mott, 60 N. Y., 6-10. The commissioners, upon application and order of court, may amend or correct their report so as to conform it to the state of facts as they exist. But they have no right at the time of such correction to hear proofs by claimants as to damages. N. Y. & Erie R. R. Co. v. Corey, 5 How., 177. Where there has been a succession of appraisals in the same county, one report may embrace all the different parcels. Troy & Rutland R. R. Co. v. Cleveland, & How., 238. The report may be report may be set aside where it appears that the commis- sioners had talked pi'ivately with a person from whom they obtained information discrediting claimant's testimony, and the award to him was greatly inadequate, and that his neglect to oppose the confirmation of the report arose from neglect or misconduct of his attorney. Matter of N. Y. C. R. R. Co., 5 Hun, 105 ; to the same effect Visscher v. H. R. R. R. Co., 15 Barb., 37. The default of an owner upon the hearing before commissioner may be excused by the supreme court on motion to confirm the report, and the report set aside and a new hearing directed. Matter of N. Y. & L. R. R. Co., 93 N. Y., 385. Upon the application to confirm a report, a commissioner who has signed such report will not be allowed to stultify himself by an affidavit that he signed it with- out reading it or hearing it read. Rochester & Genesee R. R. Co. v. Beckwith, 10 How., 168. The court must act solely on the report of the commissioners, and affidavits cannot be used to impeach or contradict it. The report must show that an error has been committed, or that injustice has been done, to enable the court to reverse or set aside the proceedings. Rondout & Oswego R. R. Co. v. Field, 38 How., 187. Where the parties have agreed as to the principles on which the appraisal is to be conducted, the court can not interfere. In re N. Y., L. & W. R. R. Co., 102 N. Y., 704. The right of the mortgagee of lands taken in condemnation proceedings to the amount of awards made to him as mortgagee, is not taken away by bis taking judgment in foreclosure without any abatement on account of the awards. Rodman v. City of Buffalo, 15 N. Y. State Rep., 583. The court will not review the judgment of the commissioners upon the facts, except in cases in which a gross inequality of values is developed, or the appraisal is made upon a wrong principle. Matter of Mayor, etc., of N. Y., 99 N. Y., 569 aff'g34 Hun, 441. 3372. Offer to compromise; amount of costs; additional allowance. In all cases where the owner is a resident and not under legal disability to convey title to real property the plaintiff before ser- vice of his petition and notice, may, make a written offer to purchase the property at a specified price, which must within ten days thereafter be filed in the office of the clerk of the county where the property is situated ; and which can not be given in evidence before the commissioners, or considered by them. The owner may at the time of the presentation of the petition, or at any time pre- ' viously, serve notice in writing of the acceptance of plaintiff's offer, and thereupon the plaintiff may, upon filing the petition, with proof of the making of the offer and its acceptance, enter an order that upon pay- ment of the compensation agreed upon, he may enter into possession 10 SUPPLEMENTAL, PROVISIONS. of the real property described in the petition, and take and hold it for the public use therein specified. If the offer is not accepted, and the compensation awarded by the commissioners does not exceed the amount of the offer with interest from the time it was made, no costs shall be allowed to either party. If the compensation awarded shall exceed the amount of the offer with interest from the time it was made, or if no offer was made, the court shall, in the final order, direct that the defendant recover of the plaintiff the costs of the proceeding, to be taxed by the clerk at the same rate as is allowed, of course, to the de- fendant when he is the prevailing party in an action in the supreme court, including the allowances for proceedings before and after notice of trial and the court may also grant an additional allowance of costs, not exceeding five per centum upon the amount awarded. The court shall also direct in the final order what sum shall be paid to the general or special guardian, or committee or trustee of an infant, idiot, lunatic or habitual drunkard, or to an attorney appointed by the court to at- tend to the interests of any defendant upon whom other than personal service of the petition and notice may have been made, and who has not appeared, for costs, expenses and counsel fees, and by whom or out of what fund the same shall be paid. If a trial has been had, and all the issues determined in favor of the plaintiff', costs of the trial shall not be allowed to the defendant, but the plaintiff shall recover of any defendant answering the costs of such trial caused by the interposition of the unsuccessful defense, to be taxed by the clerk at the same rate as is allowed to the prevailing party for the trial of an action in the supreme court. As to offer to purchase property at a specified price and acceptance of same, see sections 736 to 740, Code of Civil Procedure, both inclus : ve. 3373. Judgment, how enforced ; -when to deliver possession of premises, and -when -writ of assistance to issue. Upon the entry of the final order, the same shall be attached to the judgment roll in the proceeding, and the amount directed to be paid, either as compensation to the owners, or for the costs or expenses of the proceed- ing, shall be docketed as a judgment against the person who is directed to pay the same, and it f^hall have all the force and effect of a money judgment in an action in the supreme court, and collection thereof may be enforced by execution and by the same proceedings as judgments for the recovery of money in the supreme court may be enforced under the provisions of this act. When payment of the com- pensation awarded, and costs of the proceeding, if any, has been made, as directed in the final order, and a certified copy of such order has been served upon the ow T ner, he shall, upon demand of the plaintiff, deliver possession thereof to him, and in case possession is not 11 SUPPLEMENTAL PROVISIONS. delivered when demanded, the plaintiff may apply to the court without notice, unless the court shall require notice to be given, upon proof of such payment and of service of the copy order, and of the demand and non-compliance therewith, for a writ of assistance, and the court shall thereupon cause such writ to be issued, which shall be executed in the same manner as when issued in other cases for the delivery of possession of real property. 3374. Abandonment and discontinuance of proceeding. Upon the applica- tion of the plaintiff to be made at any time after the presentation of the petition and before the expiration of thirty days after the entry of the final order, upon eight days' notice of motion to all other parties to the proceeding who have appeared therein or upon an order to show cause, the court may, in its discre- tion, and for good cause shown, authorize and direct the abandonment and dis- continuance of the proceeding, upon payment of the fees and expenses, if any, of the commissioners, and the costs and expenses directed to be paid in such final order, if such final order shall have been entered, and upon such other terms and conditions as the court may prescribe; and upon the entry of the order granting such application and upon compliance with the terms and conditions therein pre- scribed, payment of the amount awarded for compensation, if such compensation shall have bet-n theretofore awarded, shall not be enforced, but in such case, if such abandonment and discontinuance of the proceeding be directed upon the application of the plaintiff, the order granting such application, if permitting a renewal of such proceedings, shall provide that proceedings to acquire title to such lands or any part thereof shall not be renewed by the plaintiff without a tender or deposit in court of the amount of the award and interest thereon. Am'd by chap. 475 of 1894. Took effect May. 3, 1894. A public body or public officers having the right of eminent domain for public purposes may be permitted to discontinue proceedings to ac'quire lands at any time before any rights have become vested in the property owners. Matter of Washington Park, 56 N. Y., 144. The confirmation of the report of commissioners prevents the abandoning of the proceedings. Matter of Rhinebeck & Connecticut R. R. Co., 67 N. Y., 242. Until the confirmation of the commissioners appointed to assess damages, the court may allow a discontinuance of the proceedings. Ex parte N. Y., Syracuse & B. R. R. Co., 4 Hun, 311. 3375. Appeal from final order ; stay. Appeal maybe taken to the general term of the supreme court from the final order, within the time provided for appeals from orders by title four of chapter twelve of this act ; and all the provisions of such chapter relating to appeals to the general term from orders of the special term shall apply to such appeals. Such appeal will bring up for review all the proceedings subsequent to the judgment, but the judgment and proceedings ante- cedent thereto may be reviewed on such appeal, if the appellant states in his notice that the same will be brought up for review, and ex- ceptions shall have been filed to the decision of the court or the referee, and a case or a case and exceptions shall have been made, settled and allowed, as required by the provisions of this act, for the review of the trial of actions in the supreme court without a jury. The proceedings of the plaintiff shall not be stayed upon such an appeal, except by order of the court, upon notice to him, and the appeal shall not affect his possession of the property taken, and the appeal of a defendant shall not be heard except on his stipulation not to disturb such pos- session. The objection that a corporation, seeking to condemn property under the right of eminent domain, has no legal existence, should be taken in proper time ; if not, the objection can not be raised on appeal to the court of appeals. Matter of Union E. R. R. Co. of Brooklyn, 112 N. Y., 61. 12 SUPPLEMENTAL PROVISIONS. Any person deeming himself aggrieved may appeal. N. Y. & E. R. R. Co v Corey, 5 How., 177. An appeal lies to the court of appeals from an order of the general term, affirming an order of the special term. Rensselaer & 8. R. R. Co. v. Davis, 43 N. Y., 137. But it will not review matters of discretion. Matter of N. Y. C. & H. R. R. R. Co., 64 id., 60. To the same effect Matter of Kings Co. E. R. R. Co., 82 id., 100. An appeal from so much of the order of the general term, reversing an award confirmed by the special term, as refused to appoint new commissioners, when the latter were named in a stipulation, is reviewable in the court of appeals. Matter of N. Y. & L., etc., R. R. Co., 98 N. Y., 447. The rule which deprives a party of the right to appeal from an order or judg- ment under which he has taken a benefit is not applicable to these proceedings, and the right to appeal is not affected by accepting payment for the land and giving receipt therefor. Matter of N. Y. & H. R. R. Co., 98 N. Y., 12. To the same effect Matter of N. Y., W. S. & B. R. R. Co., 94 N. Y., 287. Where the owner objects to the appointment of commissioners on the ground that the land was sought for private purposes, her failure to appeal from a decision that the purpose was public, and her consent to the appointment of commission- ers, do not amount to a waiver of her rights, and she may afterwards move to set the order aside. In re Niagara Falls & W. Ry. Co., 4 N. Y. Supp., 485. But a small portion of the evidence upon which the commissioners act in the formation of their awards can be placed before the appellate court, and there can, therefore, be no regular judicial review where the original jurisdiction is exercised in such a manner. In matter of Staten Island R. T. Co. v. Antonio Lezza i, 47 Hun, 397. 3376. Appeal from judgment by plaintiff. If a trial has been had and judgment entered in favor of the defendant, the plaintiffmay appeal therefrom to the general term within the time provided for appeals from judgments by title four of chapter twelve of this act, and all the provisions of such chapter relating to appeals from judg- ments shall apply to such appeals; and on the hearing of the appeal the general term may affirm, reverse or modify the judgment, and in case of reversal may grant a new trial, or direct that judgment be en- tered in favor of the plaintiff. If the judgment is affirmed, costs shall be allowed to the respondent, but if reversed or modified, no costs of the appeal shall be allowed to either party. 3377. New appraisal, when. On the hearing of the appeal from the final order the court may direct a new appraisal before the same or new commissioners, in its discretion, and the report of srtch commis- sioners shall be final and conclusive upon all parties interested. If \\IQ amount of the compensation to be paid is increased by the last re- port, the difference shall be a lien upon the land appraised, and shall be paid to the parties entitled to the same, or shall be deposited asthe t-.ourt shall direct ; and if the amount is diminished, the difference s>hall bo refunded to the plaintiff by the party to whom the same may have been paid, and judgment therefor may be rendered by the court, on the filing of the last report, against the parties liable to pay the same. The provision that the determination as .to damages for land taken, made by commissioners of appraisal in their second report, shall be final and conclusive, precludes as well a review by a crommo'i law certiorari as by appeal. People ex rel. Schuylerville R. R. Co v. Betts, 55 N. Y., 000. 13 SUPPLEMENTAL PROVISIONS. Such second report needs no order of confirmation. Matter of Prospect Park 1>. C. I. R. R. Co., 85 N. Y., 489. To authorize a court to review on motion a second report, there must be such an irregularity, fraud or mistake in the proceedings of the commissioners as would authorize the court under its established practice to set aside a judgment or verdict on a motion. Matter of N. Y. Elevated R. R. Co., 41 Hun, 502. 3378. Conflicting claimants. If there are adverse and conflict- ing claimants to the money, or any part of it, to be paid as compensa- tion for the property taken, the court may direct the money to be paid into the court by the plaintiff, and may determine who is entitled to the same, and direct to whom the same shall be paid, and may, in its discretion, order a reference to ascertain the facts on which such determination and direction are to be made. If the commissioners are unable to determine to whom an award should be made, it should be made to unknown owners, the title to the award being determined in subsequent proceedings -between the claimants. It is error to make a nominal award because of a failure to make title. Matter of Department of Public Parks, 53 Hun, 280. A claim to a portion of the sum awarded as compensation made by the county for unpaid taxes upon the property, can not be maintained on any ground which would be insufficient in a direct proceeding by virtue of the assessement to support a sale of the property or uphold a tax title. Matter of N. Y. C. & H. R. R. R. Co., 90 N. Y., 342. The provisions of this section are not in violation of the Constitution. The money takes the place of land, and is subject to the same liens to which the land was be- fore being taken. Matter of N. Y. C. & H. R. R. R. Co., 60 N. Y., 116. 3379. Possession of property on giving security. At any stage of the proceeding the court may authorize the plaintiff, if in possession of the property sought to be condemned, to continue in possession, and may stay all actions or proceedings against him on account thereof, upon giving security, or depositing such sum of money as the court may direct to be held as security for the payment of the compensation which may be finally awarded to the owner therefor and the costs of the proceeding, and in every such case the owner may conduct the proceeding to a conclusion, if the plaintiff delays or neglects to pros- ecute the same. 3380. When possession of real property given immedi- ately. When an answer to the petition has been interposed, and it appears to the satisfaction of the court that the public interests will be prejudiced by delay, it may direct that the plaintiff be permitted to enter immediately upon the real property to be taken, and devote it temporarily to the public use specified in the petition, upon depositing with the court the sum stated in the answer as the value of the prop- erty, and which sum shall be applied, so far as it may be necessary for that purpose, to the payment of the award that may be made, and the costs and expenses of the proceeding, and the residue, if any, returned to the plaintiff, and, in case the petition should be dismissed, or no award should be made, or the proceedings should be abandoned by the plaintiff, the court shall direct that the money so deposited, so far as it 14 SUPPLEMENTAL PROVISIONS. may be necessary, shall be applied to the payment of any damages which the defendant may have sustained by such entry upon and use of his property, and his costs and expenses of the proceeding, such damages to be ascertained by the court, or a referee to be appointed for that purpose, and if the sum so deposited shall be insufficient to pay such damages, and all costs and expenses awarded to the defendant, judg- ment shall be entered against the plaintiff for the deficiency, to be enforced and collected in the same manner as a judgment in the supreme court ; and the possession of the property shall be restored to the defendant. 3381. Notice of pendency of action to be filed. Upon ser- vice of the petition, or at any time afterwards before the entry of the final order, the plaintiff may file in the clerk's office of each county where any part of the property is situated, a notice of the pendency of the proceeding stating the names of the parties and the object of the proceeding, and containing a brief description of the property effected thereby, and from the time of filing, such notice shall be constructive notice to a purchaser, or incumbrancer of the property effected thereby, from or against a defendant with respect to whom the notice is directed to be indexed, as herein prescribed, and a person whose conveyance or incumbrance is subsequently executed or subsequently recorded, is bound by all proceedings taken in the proceeding, after the filing of the notice, to the same extent as if he was a party thereto. The county clerk must immediately record such notice when filed in the book in his office kept for the purpose of recording notices of pendency of actions, and index it to the name of each defendant specified in the direction appended at the foot of the notice, and subscribed by the plaintiff or his attorney. 3382. Practice in cases not provided for. In all proceedings under this title, where the mode or manner of conducting all or any of the proceedings therein is not expressly provided for by law, the court before whom such proceedings may be pending, shall have the power to make all necessary orders and give necessary directions to carry into effect the object and intent of this title, and of the several acts conferring authority to condemn lands for public use, and the practice in such cases shall conform, as near as may be, to the ordinary practice in such court. 3383. Repealing clause. So much of all acts and parts of acts as prescribe a method of procedure in proceedings for the condemna- tion of real property for a public use is repealed, except such acts and parts of acts as prescribe a method of procedure for the condemna- tion of real property for public use as a highway, or as a street, ave- nue, or public place in an incorporated city or village, or as may pre- 15 SUPPLEMENTAL PROVISIONS. scribe methods of procedure for such condemnation for any public use for, by, on behalf, on the part, or in the name of the corporation of the city of New York, known as the mayor, aldermen, and commonalty of the city of New York, or by whatever name known, or by or on the application of any board, department, commissioners or other officers acring for or on behalf or in the name of such corporation or city, or where the title to the real property so to be acquired vests in such cor- poration or in such city; and all proceedings for the condemnation of real property embraced within the exceptions enumerated in this sec- tion are exempted from the operation of this title. [Thus amended by Laws 1890, chap. 247.*] 3384. When act to take effect, This title shall take effect on the first day of May, one thousand eight hundred and ninety, and shall not affect any proceeding previously commenced. TITLE II. PROCEEDINGS FOR THE SALE OF CORPORATE REAL PROPERTY. SECTION 3390. When proceedings pursuant to the provisions of this title to be taken. 3391. Proceedings to be instituted by presentation of petition; what to contain. 3392. Hearing of application. Notice, appointment of referee. 3393. Order ; when application for, may be opposed. 3394. Insolvent corporation or association ; notice to creditors. 3395. Service of notices; how made. 3396. Practice in cases not provided for. 3397. When act to take effect. 3390. When proceedings pursuant to the provisions of this title to be taken. Whenever any corporation or joint-stock associa- tion is required by law to make application to the court for leave to mortgage, lease or sell its real estate, the proceeding therefor shall be had pursuant to the provisions of this title. 3391. Proceeding*, to be instituted by presentation of petition; what to contain. The proceeding shall be instituted by the presentation to the supreme court of the district or the county court of the county where the real property, or some part of it, is situated, by the corporation or association, applicant, of a petition setting forth the following facts : 1. The name of the corporation or association, and of its directors, trustees or managers, and of its principal officers, and their places of residence. 2. The business of the corporation or association, or the object or purpose of its incorporation or formation, and a reference to the statute under which it was incorporated or formed. *Thc amendment by chapter 247, Laws 1890, was passed April 30, 1890, and went into ctiec' immediately. Ifi SUPPLEMENTAL PROVISIONS. 3. A description of the real property to be sold, mortgaged or leased, by metes and bounds, with reasonable certainty. 4. That the interests of the corporation or association will be promoted by the sale, mortgage or lease, of the real property specified, and a concise statement of the reasons therefor. 5. That such sale, mortgage or lease has been authorized, by a vote of at least two-thirds of the directors, trustees or managers of the cor- poration or association, at a meeting thereof, duly called and held, and a copy of the resolution granting such authority. 6. The market value of the remaining real property of the corpora- tion or association, and the cash value of its personal assets, arid the total amount of its debts and liabilities, and how secured, if at all. 7. The application proposed to be made of the moneys realized from such sale, mortgage or lease. 8. Where the consent of the shareholders, stockholders or members of the corporation or association, is required by law to be first obtained, a statement that such consent has been given, and a copy of the con- sent or a certified transcript of the record of the meeting at which it was given, shall be annexed to the petition. 9. A demand for leave to mortgage, lease or sell the real estate described. The petition shall be verified in the same manner as a verified pleading in an action in a court of record. As to requirements of petition on sale of real estate of religious corporations in first department, see rulea of the general term of the supreme court, first district, March, 1862. Under the act to provide for the incorporation of religious societies, the trustees of such a corporation are authorized to act in its behalf in taking the steps required for effecting a sale of its real estate, and their acts are binding upon it, although it does not appear that they had the express sanction or authority of a majority of the corporation. The Madison Avenue Baptist Church v. The Baptist Church in Oliver street, 46 N. Y., 131. Same case in 73 N. Y., 82, on a subsequent appeal. 3392. Hearing of application Notice Appointment of referee. Upon presentation of the petition, the court may immedi- ately proceed to hear the application, or it may, in its discretion, direct that notice of the application shall be given to any person interested therein, as a member, stockholder, officer or creditor of the corporation or association, or otherwise, in which case the application shall be heard at the time and place specified in such notice, and the court may in any case appoint a referee to take the proofs and report the same to the court, with his opinion thereon. 3393. Order ; when application for, may be opposed. Upon the hearing of the application, if it shall appear, to the satisfaction of the court, that the interests of the corporation or association will be promoted thereby, an order may be granted authorizing it to sell, morrgage or lease the real property described in the petition, or any part thereof, for such sum, and upon such terms as the court may pre- 17 SUPPLEMENTAL PROVISIONS. scribe, and directing what disposition shall be made of the proceeds of such sale, mortgage or lease. Any person, whose interests may be affected by the proceeding, may appear upon the hearing and show caute why the application should not be granted. A provisional order may be made, e. g., an order that the sale may be made for a certain price ttnd if a proper site for a new church can be obtained. Matter of Brick Presbyterian Church, 3 Edw., 155. The sale may be made by the trustees, or by an officer appointed by the court. De Ruyter i>. St. Peter's Church, 3 N. Y., 240. It seems that the jurisdiction of the court to make an order for a sale depends upon ihe facts before it when the order was made, and that the order cannot be sustained by proof that the facts existed which justified the order, but which did not appear to the court at the time of the application. Wheaton v. Gates, 18 N. Y., 395. Where it appears from the application that the sale is sought for the purpose of distributing the proceeds among the pew-holdei-s, the court has no jurisdiction to grant the application, and its order is inoperative. Madison Avenue Baptist Church v. Baptist Church in Oliver St., 46 N. Y., 140, citing Wheaton v. (rates, 18 N. Y., 395. Jurisdiction of the court to order sale by a religious society of its real estate, under Laws 1813, chap. 60, 11, depends upon the facts before it at the time of making the order, and cannot be upheld by proof that facts which would have justified the order existed, but were not brought to its attention. Madison Avenue Baptist Church v. Baptist Church in Oliver St., 73 N. Y., 82. 3394. Insolvent corporation or association ; notice to cred- itors. If the corporation or association is insolvent, or its property and assets are insufficient to fully liquidate its debts and liabilities, the application shall not be granted, unless all the creditors of the cor- poration have been served with a notice of the time and place at which the application will be heard. 3395. Service of notices ; how made. Service of notices, pro- vided for in this title, may be made either personally or, in case of absence, by leaving the same at the place of residence of the person to be served, with some person of mature age and discretion, at least eight days before the hearing of the application, or by mailing the same, duly enveloped and addressed and postage paid, at least six- teen days before such hearing. 3396. Practice in cases not provided for. In all applications made under this title, where the mode or manner of conducting any or all of the proceedings thereon are not expressly provided for, the court before whom such application may be pending, shall have the power to make all the necessary orders and give the proper directions to carry into effect the object and intent of this title, or of any act authorizing the sale of corporate real property, and the practice in such cases shall conform, as near as may be, to the ordinary practice in such court. 3:597. When act to take effect This title shall take effect May first, one thousand eight hundred and ninety, and shall not affect any r^oceeding previously commenced. 18 No. 1. PLAINTIFF'S PETITION FOR CONDEMNATION OF REAL PROPERTY. ( 3360.) SUPREME COURT COUNTY OP ALBANY. RAILROAD COMPANY, Plaintiff, against Defendant. To the Supreme Court : The Railroad Company, the above named plaintiff, by this petition, respectfully shows to this court : First. That the said Railroad Company is a domestic corporation duly Organized under and in pursuance of the laws of the State of New York, for the purpose of constructing, main- taining and operating a railway for public use in the conveyance of persons and property, from a point on the north side of Forty-second street, near Vanderbilt avenue, in the city and county of New York ; running thence through said city to a point on the Hudson river at or near Spuyten Duyvil, and thence along or near the east shore of the Hudson river via Peekskill, Poughkeepsie and Hudson to or near East Albany, crossing the Hudson river at Albany ; thence to Schenectady, and thence along or near the north shore of the Mohawk river to Utica ; thence via Syracuse to Buffalo ; the line of said railway running through or into the counties of Westchester, Putnam, Dutchess, Colum- bia, Rensselaer, Albany, etc., in the State of New York ; that the said plaintiff has its principal place of business at the Grand Central depot, New York city ; and that the names and places of residence of its principal officers ire : president, New York city; secretary, New York city ; and of its directors are, , . 19 FORMS. Second. That the real property to be condemned is situated in the city and county of Albany and state of New York, bounded and described as follows, to wit : (describe property). Third. That the public use for which the said property is required is for tracks, switches and sidings, whereon and whereby plaintiff's cars and trains may be moved, loaded and unloaded, stored, received and dispatched ; that said property is necessary from the great increase of the business of the plaintiff, in that it will enable the plaintiff to lay out additional tracks for the loading and unloading of cars ; furnish additional room for the storage of cars ; to receive and deliver freight with increased convenience ; save time and expense to the consignee of freight arid to the plaintiff, and in every respect pro- mote the interest -and welfare of the plaintiff, as well as of those who furnish freight for transportation. Fourth. That the names and places of residence of the owners of said property are as follows, viz.: and whose place of residence can- not, after diligent inquiry, be ascertained. ( Where owner infant:) That said is an infant, and his general guardian is , who resides at No. 1180 Broadway, in the city of Albany, N. Y.; that is an infant, but has no general guardian, and resides with at No. 42 Colonie street, in the city of Albany, N. Y. ! ( Where owner is lunatic, idiot or habitual drunkard :) That said is a lunatic, and that his committee (or trustee) is , who resides at No. 64 Livingston avenue, in the city of Albany, N. Y. ; that said is a habitual drunkard ; that he has no com- mittee (or trustee), and resides with at No. in the city of Albany, N. Y. ( Where owner non-resident, having agent or attorney :) That said- is a non-resident residing in the city of Toledo, and State of Ohio, having an agent (or attorney) \i\ the State authorized to contract for the sale of the said property, whose name is residing at No. 42 Van Woert street, in the city of Albany, N. Y. (Where owner unknown:) That the owner of the said property is unknown to the plaintiff, and cannot, after diligent inquiry, be ascer- tained; that for the purpose of ascertaing him, inquiry was made of numerous persons residing 'upon and in the vicinity of the said prop- erty, and of many others who would be most likely to have knowledge as to who the owner of said property was; and that the only information plaintiff could obtain from any of such persons, in all such conversa- tions and inquiries, is that a person whose name could not be learned, claimed to own the said property in the year 186H, and who, in 18(55, removed to San Francisco, California, and has not been seen or heard from since. 20 FORMS. ( "Where place of residence of owner unknown : ) That the place of resi- dence of is unknown to plaintiff, and cannot, after diligent inquiry, be ascertained ; that for the purpose of ascertaining it, inquiry was made of , who resides in the city of Troy, N. Y., who is said brother, and only relative residing in this state, and that said , in answer to said inquiries, on or about the 1st day of May last, said that he was ignorant of said residence ; but that said was not a resident of this state, and that his last known place of residence was at Lima, Ohio, from whence he moved about a year ago ; that a letter addressed to said , at Lima, Ohio, was deposited in the post-office at Albany, N. Y., and was shortly thereafter returned through the post-office, with the information that the said could not be found. Fifth. That the plaintiff has been unable to agree with the owners of the said property for its purchase, for the reason that the said owners demand nine thousand dollars for said property, which is largely in excess of the value thereof. /Sixth, That the value of the said real property is five thousand dollars. /Seventh. That it is the intention of the plaintiff in good faith to complete the work or improvement for which the said property is to be condemned, and that all the preliminary steps required by law have been taken to entitle it to institute these proceedings. Wherefore the plaintiff demands that it may be adjudged that the public use requires the condemnation of the real property herein de- scribed, and that the plaintiff be entitled to take and hold such prop- erty for the public use specified, upon making compensation therefor, and that commissioners of appraisal be appointed to ascertain the com- pensation to be made to the owners for the property so taken. Dated, New York City, May 7, 1890. RAILROAD COMPANY, By , President. STATE OF NEW YORK, ) CITY AND COUNTY OF NEW YORK, / ss ' ' , being duly sworn, says that he is the President of the - Railroad Company, the plaintiff named, in the foregoing petition ; that he knows the contents of said petition, and that the same is true to his own knowledge except as to the matters therein stated to be alleged upon information and belief, and that as to those matters he believes it to be true. Subscribed and sworn to before me ) . this 7th day of May, 1890. j A. B., Notary Public, New York County. 21 FORMS, No. 2. NOTICE OF TIME AND PLACE OF PRESENTATION OF PETITION. ( 3361). NEW YORK SUPREME COURT -COUNTY OF ALBANY. Plaintiff, against Defendants. Take notice, that the petition of the New York Central and Hudson River Railroad Company, a copy of which is herewith served upon you, will be presented to the Supreme Court of the State of New York, at a Special Term thereof, appointed to be held at the City Hall in the city of Albany, N. Y., on the 27th day of May, 1890, at the opening of the court on that day, or as soon thereafter as counsel can be heard, and a motion will then and there be made that the demand of said petition be granted. Dated Albany, N. Y., May . Yours, etc., R. & H., Attorneys for Plaintiff. Office and post-office address, Tweddle building, Albany, N. Y. To A. B., etc., (naming owners of property). No. 3. ANSWER CONTAINING GENERAL AND SPECIFIC DENIALS. ( 3365.) [Name of Court.] [Names of all the parties.] The defendant [name, if less than all] answering the petition of the plaintiff herein: Denies [or denies upon information and belief] that, etc. [stating allegation of the petition denied by him, and in like manner make denial of each allegation specifically denied.] [Or denies each and every allegation in said petition contained.] [Or denies any knowledge or information sufficient to form a belief, as to each and every allegation in the said petition contained.] [Or denies any knowledge or information sufficient to form a belief, 22 FORMS. as to whether, etc. (stating the allegation, as to which such denial ?s made,) and in like manner as to each allegation so denied.] Wherefore this defendant demands judgment against the plaintiff, dismissing the petition herein, together with costs. G. 8., Defendant's Attorney. Office and post-office address, No. street, , N. Y. STATE OF NEW YORK, \ CITY AND COUNTY of ALBANY, J ss * * F. K., being duly sworn, says that he is one of the defendants named in the above entitled proceeding , that the foregoing answer is true to the knowledge of the deponent, except as to the matters therein stated to be alleged on information and belief, and that as to those matters he believes it to be true. F. X. K. Subscribed and sworn to before me, ) this day of May, 1890. / No. 4. ANSWER SETTING UP NEW MATTER AS A DEFENSE. ( 3365.) [Nam> of Court.] [Names of all the parties ] The defendant [name, if less than all], answering the petition of plaintiff herein, alleges that, etc. [stating facts or new matter constituting defense], Wherefore this defendant demands judgment against the plaintiff, dismissing petition herein, together with costs. R. G. Defendants Attorney. Office and post office address, No. street, , N. Y. [Verification as inform No. 3.J A. SECTION. Abandonment of proceedings 3374 Actions in supreme court, rules of, to govern 3364 Additional allowance 3372 Adjournments by commissioners 3370 Answer in condemnation proceedings 3365 Appeal, from final order 3375 from judgment 3376 Appearance, by defendants in condemnation proceedings 3363 of parties 3364 Application for leave to sell, etc., how regulated 3390 Appointment of commissioners to ascertain compensation 3369 Appraisal, when a new one ordered 3377 Attorney, who court to appoint 3363 c. Commissioners, proceedings of 3370 to ascertain compensation, appointment of 3369 Compromise, offer to . 3372 Confirmation of commissioners' report , 3371 Conflicting claimants 3378 Contents, of answer in condemnation proceedings 8365 of judgment of condemnation 3369 of petition for condemnation 3360 of petition for leave to sell, etc 3391 Costs, for guardian, etc 3372 generally 3372 when awarded defendant , 3369 D. Defendant, when awarded costs 3369 Deli vering possession of premises 3373 Deposit of money, deemed payment 3371 E. Enforcement of judgment 3373 Exceptions to findings 3367 F. Fees of commissioners 3370 Final order, after commissioners' report 3371 G. General provisions applicable to condemnation proceedings 3364, 3368 Guardian ad litem, appointment of 3363 INDEX. H. SECTION. Habitual drunkard , a defendant, appearance for .......................... 3363 Hearing- of application to sell, etc ........................................ 3392 I. Idiot defendant, appearance for.... .......... . ........................... 3363 Immediate possession, when given ........ . ............ ..... ............. 3380 Infant defendant, appearance by ............................ . ............ 3363 Insolvent corporation, application by, to sell, etc .......................... 3394 Issues on condemnation, trial of .......................................... 3367 J. Judgment, appeal from, by plaintiff ...................................... 3376 how enforced ...................... . ......................... 3373 of condemnation .............................................. 3369 Lease of corporate real property.... vtl . 9 ............ . ..... . .... .... 3390-383. Protecting civil and public rights. A person who- 1. Excludes a citizen of this state, by reason of race, color or pre- vious co .dition of servitude, from the equal enjoyment of any accom- modati -n. facility or privilege furnished by innkeepers or common carriers, or by owners, managers or lessees of theatres or other places of Mmusemi-nt, or by teachers and officers of common schools and public institutions of learning, or by cemetery associations; or 2. Denies or aids or incites another to deny to any other person be- cause of race, creed or color, full enjoyment of any of the accommoda- tions, advantages, facilities and privileges of any hotel, inn, tavern, , restaurant, public conveyance on land or water, theatre or other place of public resort or amusement, Is guilty of a misdemeanor, punishable by fine of not less than fifty lollars nor more than five hundred dollars. Am'd by chap. 692 of 1893. In effect October 1, 1893. 384h. Hours of labor to be required. Any person or cor- poration, 1. Who, contracting with the state or a municipal corporation, shall require more than eight hours work for a day's labor: or, 2. Who shall require more than ten hours labor, including one-half hour for dinner, to be performed within twelve con- secutive hours, by the employes of a street surface and elevated railway owned or operated by corporations whose main line of travel or routes lie principally within the corporate limits of cities of more than one hundred thousand inhabitants; or, 3. Who shall require the employes of a corporation owning or operating a brick yard to work more than ten hours in any one day or to commence work before seven o'clock in the morn- ing, unless by agreement between employer and employe; or, 4. Who shall require the employes of a corporation operating a line of railroad of thirty miles in length or over, in whole or in part within this state to work contrary to the requirements of article one of the labor law, is guilty of a misdemeanor, and on conviction therefor shall be punished by a fine of not less than five hundred nor more than one thousand dollars for each offense. If any contractor within the state or a municipal corporation shall require more than eight hours for a day's labor, upon conviction therefor in addition to such fine, the contract shall be forfeited at the option of the municipal cor- poration. [Added, ch. 416 of 1897. To take effect June 2, 1897.] 415a. Penalty for neglect to post schedule of ferry rates. A person, corporation or association operating any ferry in this state, or between this state and any other state, operating from or to a city of five hundred thousand inhabitants or over, posting a false schedule of ferry rates, or neglecting to post in a conspicuous and accessible place in each of its ferry-houses, in plain view of the passengers, a schedule, plainly printed in the English language, of the rates of ferriage charged thereon and authorized by law to be charged for ferriage over such ferry, is guilty of a misdemeanor. [Added by ch. 692 of 1893. In effect October 1, 1893.] 416. Unlawful offers to railroad commissioners or their employes. Any officer, agent or attorney of a railroad cor- poral ion who offers a place, appointment, position or any other consideration to a railroad commission, . or to a secretary, clerk, agent, employe or expert employed by the board of railroad commissioners, is guilty of a misdemeanor. [In force till October 1, 1893.] la 416. Unlawful acts of and neglect of duty by railroad officials. An officer, agent, attorney or employe of a railroad cor- poration, who: 1. Offers a place, appointment, position orany other consideration to a railroad commissioner or to a secretary, clerk, agent, employe oj expert employed by the board of railroad commissioners; or 2. After dne notice, neglects or refuses to make or furnish any statement or report lawfully required by the board of railroad commis- sioners or willfully hinders, delays or obstructs such commissioners in the discharge of their official duties, Is guilty of a misdemeanor. Am'd by chap. 692 of 1898. In effect October 1, 1893. 417. Misconduct of railroad commissioners and of their employes. Any railroad commissioner, or any secretary, clerk, agent, expert or other person employed by the board of railroad com- missioners, who : 1. Directly or indirectly solicits or requests from or recommends to any railroad corporation, or to any officer, attorney or agent thereof, the appointment of any person to any place or position ; or, 2. Accepts, receives or requests, either for himself or for any other person, any pass, gift or gratuity from any railroad corporation; or, 3. Secretly reveals to any railroad corporation, or to any officer, member, or employe thereof, any information gained by him from any other railroad corporation ; Is guilty of a misdemeanor. 418. Person unable to read not to act or be employed as engineer. -Any person unable to read the time tables of a railroad and ordinary hand writing, .who acts as an engineer or runs a locomotive or train on any railroad in this State; or any person who, in his own behalf, or in the behalf of any other person or corporation, knowingly employs a person so unable to read to act as such engineer or to run any such locomotive, is guilty of a misdemeanor ; or who employs a person as a telegraph operator who is under the age of eigh- teen years," or who has less than one year's experience in telegraphing, to receive or transmit a telegraphic message or train order for the movement of trains, is guilty of a misdemeanor Ani'd by chap 892 of 1895. To go into effect Sept. 1, 1895. 419. Misconduct of officials or employes on elevated rail- roads Any conductor, brakeman, or other agent or employe of an elevated railroad, who: 1. Starts any train or cars of such railroad, or gives any signal or order to any engineer or other person to start any such train or car, before every passenger therein who manifests an intention to depart therefrom by arising, or moving toward the exit thereof, has departed therefrom; or before every passenger on the platform or station at which the train has stopped, who manifests a desire to enter the train, has actually boarded or entered the same, unless due notice is given 2 by au authorized employe of such railroad taat the train is full, and that no more passengers can then be received ; or, "2. Obstructs the lawful ingress or egress of a passenger to or from any such car; or, 8. Opens a platform gate of any such car while the train is in motion, or starts such train before such gate is iirmly closed ; Is guilty of a misdemeanor. 420. Intoxication or other misconduct of railroad or steam- boat employes. 1 . Any person who, being employed upon any rail- way as engineer, conductor, baggaijeninster, brakeman, switchtender, fireman, bridge-tender, flagman, sijnal man, or having charge of stations, starting, regulaiing 01- r.inuiug trains upon a railroad, or, being employed as captain, engineer or other officer of a vessel pro- pelled by steam, is intoxicated while engaged in the discharge of any such duties ; or, 2. Au engineer, conductor, brakeman, switch-tender, or other offi- cer, agent or employe of any railroad corporation, who willfully violates or omits his duty as such officer, agent or employe, by which human life or safety is endangered, the punishment cf which is not otherwise prescribed ; Is guilty of a misdemeanor. 423. Platforms .nd heating apparatus of passenger cars. A railroad corporation, or any officer or director thereof having charge of its railroad, or any person managing a railroad in this state, or any person or corporation running passenger cars upon a railroad into or through this state, who : 1. Fails to have the platforms or ends of the passenger cars run upon such railroad constructed in such manner as will prevent pas- sengers falling between the cars when in motion; or, 2. Except temporarily, in case of accident or emergency, heats any passenger car, while v iu motion, on any such railroad more than fifty miles in length, except a narrow-gauge railroad which runs only mixed trains, between October fifteenth and May first, by any stove :r furnace inside of or suspended from such car, except stoves of a pattern and kind approved by the board of railroad commissioners for cooking purposes in dining-room cars, and except within the extended time allowed by the railroad commissioners in pursuance of law for introducing other heating aparatus ; Is guilty of a misdemeanor. 424. Guard posts ; automatic couplers. All corporations and persons other than employes, operating any steam railroad in this state, 3 1. Failing to cause guard posts to be placed in prolongation of the line of bridge trusses upon such railroad, so that in case of derail- ment, the posts and not the trusses shall receive the blow of the derailed locomotive or car; or, 2. Failing after November first, eighteen hundred and ninety-two, to equip all their own freight cars, run and used in freight or other trains on such railroad, with automatic self-couplers, or running or operating on such railroad any freight car belonging to any such per- son or corporation, without having the same equipped, except in case of accident or other emergency, with automatic self-couplers, and except within the extended time allowed by the board of railroad com- missioners, in pursuance of law, for equipping such car with such couplers, is guilty of a misdemeanor, punishable by a fine of five hundred dollars for each offense. Amended by ch. 664 of 1896. In effect May 14, 1896. 433a. Lights upon swing bridges. A corporation, company or individual, owning, maintaining or operating a swing bridge acm the Hudson River, who during the navigation season between sun- down and- sunrise, neglects to keep and maintain upon every such bridge the lights required by law, is guilty of a misdemeanor. Added by ch. 692 of 1893. In effect October 1, 1893. 447a. Negligently furnishing insecure scaffolding. A person or corporation employing or directing another to do or perform any labor in the erection, repairing, altering or painting, any house, building or structure within this state, who knowingly or negligently furnishes or erects or causes to be furnished or erected for the per- formance of such labor, unsafe, unsuitable or improper for the per- formance of such labor, unsafe, unsuitable or improper scaffolding, hoists, stays, ladders or other mechanical contrivances; or who hinders or obstructs any officer detailed to inspect the same, destroys or defaces any notice posted thereon, or permits the use thereof after the same has been declared unsafe by such officer contrary to the pro- visions of article one of the labor law, is guilty of a misdemeanor. Amended by ch. 416 of 1897. In effect June 2, 1897. 447-f. Bribery of labor representatives. A person who gives or offers to give any money or other things of value to any duly appointed representative of a labor organization with intent to in- fluence him in respect to any of his acts, decisions, or other duties as such representative, or to induce him to prevent or cause a strike by the employees of any person or corporation, is guilty of a mis- demeanor ; and no person shall be excused from attending and testi- fying, or producing any books, papers or other documents before any court or magistrate, upon any investigation, proceeding or trial, for a violation of this section, upon the ground or for the reason that the testimony or evidence, documentary or otherwise, required of him may tend to convict him of a crime or subject him to a penalty or forfeiture; but no person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter or thing concerning which he may- so testify or produce evidence, docu- mentary or otherwise, and no testimony so given or produced shall be received against him upon any criminal investigation or pro- ceeding. Added by ch 659 of 1904. In effect September 1, 1904. CHAPTER XL ~V\U1)ULENT INSOLVENCIES BY CORPORATIONS AND OTHER FRAtTM IN THEIR MANAGEMEMT. SECTION 590. Frauds in the organization of corporations. 591. Fraudulent issue of stock, scrip, etc. 592. Frauds in procuring organization of corporation, or increase of capital. 593. Acting for foreign corporations not authorized to do business in this state. 594. Misconduct of directors of stock corporations. 595. Misconduct of directors of banking corporations. 596. Loans made in violation of last section, not invalid. 597. Sale or hypothecation of bank notes by officer, etc. 598. Officer of bank putting excessive number of its notes in circulation. 599. Officer or agent of banking corporation, making guaranty or indorse- ment, in its behalf, in certain case's. 600. Bank officer overdrawing his account. 601. Receiving deposits in insolvent bank. 602. Unlawful investments by officers of savings banks. 603. Misconduct by directors of monied corporations. 604. Misconduct by banks and bankers. 605. Unlawful discount of bills of forcir i bnnks. 606. Misconduct by officers of banking department. 607. Using dies and plates of extinct state bank. 609. Private banker using sign. 610. Misconduct of officers and directors of stock corporations. 611. Misconduct of officers and employes of corporation. 612. Misconduct of officers and agents of pipe-line corporations. 613. Misconduct at corporate election. 614. Presumption of knowledge of corporate condition and business, and of assent thereto by directors; definitions. 590. Frauds in the organization of corporations. A person who ; 1. Without authority subscribes the name of another to or inserts the name of another in any prospectus, circular or other advertisement or announcement of any corporation or joint stock association existing s. 4 a or intended to be formed, with intent to permit the same to be pub- lished, and thereby to lead persons to believe that the person whose name is so subscribed is an officer, agent, member or promoter of such corporation or association ; or, 2. Signs the name of a fictitious person to any subscription for or agreement to take stock in any corporation, existing or proposed; or, 3. Signs to any such subscription or agreement the name of any person, knowing that such person does not intend in good faith to comply with the terms thereof, or under any understanding or agree- ment, that the terms of such subscription or agreement are not to be complied with or enforced ; Is guilty of a misdemeanc 591. Fraudulent issue of stock, etc. An officer, agent, or other person in the service of any joint-stock compahy or corporation formed or existing under the laws of this state, or of the United States or of any state or territory thereof, or of any foreign government or country, who wilfully and knowingly, with intent to defraud, either : 1. Sells, pledges or issues, or causes to be sold, pledged or issued, or signs or executes, or causes tq be signed or executed with intent to sell, pledges or issues, or causes to be sold, pledged or issued, any cer- tificate or instrument purporting to be a certificate or evidence of the ownership of any share or shares of such company or corporation, or any bond or evidence of debt, or writing purporting to be a bond or evidence of debt of such company or corporation, without being first thereto duly authorized by such company or corporation, or contrary ' to the charter or laws under which such corporation or company exists, or in excess of the power of such company or corporation or of the limit imposed by law or otherwise upon its power to create or issue stock or evidence of debt ; or, 2. Reissues, sells, pledges or disposes of, or causes to be reissued, sold, pledged or disposed of, any surrendered or canceled certificates, or other evidence of the transfer or ownership of any such share or shares, is punishable by imprisonment for [a term not exceeding] seven years, or by a fine not exceeding three thousand dollars, or by both. Am'p ch. 662 of 1892. In effect May 18, 1892. 592. Frauds in procuring organization, corporation, etc. An officer, agent or clerk of a corporation, or of persons proposing to organize a corporation, or to increase the capital stock of a corporation, who knowingly exhibits a false, forged or altered book, paper, voucher, security or other instrument of evidence to any public officer or board authorized by law to examine the organization of such corporation, or to investigate its affairs, or to allow an increase of its capital with in- 5 593. Acting for foreign corporations not authorized to do business in this state. Any person or corporation who 1. Acts as agent or representative of any mortgage company or co-operative loan and building association organized outside of this state, while such mortgage company or co-operative loan and building association shall not be authorized under a license .of the superin- tendent of banks to do business in this state, or 2. Acts as agent or representative in this state of a foreign corpora- tion, other than a moneyed corporation, with the words " trust," " bank," " banking," " insurance," "assurance," " indemnity," " guar- antee," " guaranty," " savings," " investment," " loan," " benefit," or any other words or terms indicating, representing or holding out such company to be a moneyed corporation as a part of its name or corporate title, or who, in connection with such corporation or other- wise, shall put forth any sign containing said name, or who shall advertise or publish the said company as doing business in this state, directly or indirectly, through agent s or otherwise, while such company shall not be authorized under a certificate procured from the secre- tary of state pursuant to section fifteen of the general corporation law to do business in this state, is guilty of a misdemeanor. Amended by ch. 489 of 1904. In effect April 29, 1904. 594. (Sub. 7.) To receive in exchange for the shares, notes, bonds or' other evidences of debt of such corporation, shares of the capital stock, notes, bonds or other evidences of debt issued by any other stock corporation engaged in another line of business unless authorized by law to make such exchange. 603. Unlawful investments by officers of savings banks. Any officer or trustee of a savings bank authorizing or making any investment of the funds of the bank in securities, not authorized by law, is guilty of a misdemeanor. 603. Misconduct by directors of monied corporations. Every director of a monied corporation who: 1. In case of the fraudulent insolvency of such corporation, shall have participated in such fraud; or, 2. Willfully does any act as such director which is expressly for- bidden by law, -or willfully omits to perform any duty imposed upon him as such director by law; Is guilty of a misdemeanor,, if no other punishment is prescribed therefore by law. The insolvency of a monied corporation is deemed fraudulent unless its affairs appear upon investigation to have been administered fairly, legallv and with the sama care and diligence that agents receiving a compensation for their services are bound, by law, to observe. . 604. Misconduct by banks and bankers. Any monied cor- poration or individual banker authorized to carry. on the business of banking under the laws of this state who : 1. I'ereives. pays out, gives or offers in payment as money to cir- culate, or who attempts to circulate as money, any bill, note or other evidence of debt issued or purporting to have been issued by any cor- poration or individual, situated or residing without this state, and whifb bill, note or other evidence of debt shall, upon any part thereof, purport to be payable or 'redeemable at any place or by any corpora- tion or individual within this state ; or, 2. Issues, utters or circulates, as money, or in any way, directly or indirectly, aids or assists in the issuing, uttering or circulating as money within this state, of any bank bill, note or other evidence oi debt in the similitude of a bank note issued or purporting to have be in issued by any corporation or individual situated or residing without this state ; or procures or receives, in any manner whatever, any such bank bill, note or other evidence of debt, with intent to issue, utter or circulate, or with intent to aid in issuing, uttering or circulating the same as money within this state ; or, 3. Directly or indirectly lends or pays out for paper discounted or purchased any bank bill, note or other evidence of debt, which is not received at par by such corporation or banker for debts due such corporation or banker ; or, 4. Issues or puts in circulation any bank bill or note of any such corporation or banker, unless the same shall be made payable on de- mand and without interest, except bills of exchange on foreign countries or places beyond the limits or jurisdiction of the United States ; Is guilty of a misdemeanor. Nothing in this section contained shall be construed to prohibit any such corporation or banker from receiving and paying out such foreign bank bills as they shall receive at par in the ordinary course of their business, or to prohibit such corporation or banker from receiving foreign notes from their dealers and customers in the regular and ususal course of their 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 such foreign notes are made, the payment or redemption thereof 605. Unlawful discount of bills of foreign banks. Any per- son, association or corporation within the state who, directly or indirectly, on any pretense whatever, procures or receives or offers to receive from any corporation or person any bank bill or note or other evidence of debt in the similitude of a bank note issued or purporting to have been issued by any corporation or individual, situated or residing without this state, at a greater rate of discount than is or sha,ll be at the time fixed by law for the redemption of the bills of the banks of this state at their agencies, is guilty of a misdemeanor. 606. Misconduct by officers of banking department The superintendent of banks, or any officer in the banking depart- ment who countersigns bills or notes for' any person or corporation exceeding the value of the interest bearing stocks of the state of New 7 York or of the United States, or other securities deposited with such superintendent by such person or corporation on account thereof, is guilty of a felony, punishable by a fine of not less than five thousand dollars or by imprisonment for not less than five years, or by both. 607. Using dies and plates of extinct state bank. Any per- son who uses the dies and plates of a state bank in the manufacture of notes and bills, after such bank has become a national bank in pursuance of law, is guilty of a misdemeanor. 609. Private banker using sign. Any person engaged .n banking in this state, not subject to the supervision of the superin- tjndent of banks, and not required by law to report to such superin- tendent, who was not engaged in such banking before May 23, 1385, who, 1. Uses an office sign at the place where such business is transacted, Having thereon any artificial or corporate name, or other words, indicating that such place or office is the place or office of a bank ; or, 2. Uses or circulates any letter-heads, bill-heads, blank notes, blank receipts, certificates, circulars or any written or printed paper what- ever, having thereon any artificial or corporate name, or other word or words indicating that such business is the business of a bank ; Is guilty of a misdemeanor. 610. Misconduct of officers and directors of stock corpora- tions. An officer or director of a stock corporation who : 1. Issues, participates in issuing, or concurs in a vote to issue any increase of its capital stock beyond the amount of the capital stock thereof, duly authorized by or in pursuance of law ; or, 2. Sells, or agrees to sell, or is directly or indirectly interested in the sale of any share of stock of such corporation, or in any agreement to sell the same, unless at the time of such sale or agreement he is an actual owner of such share ; Is guilty of a misdemeanor, punishable by imprisonment for not less than six months or by a fine not exceeding five thousand dollars or by both. 611. Misconduct of officers and employes of corporations. A director, officer, agent or employe of any corporation or joint- stock association who : 1. Knowingly receives or possesses himself of any of its property otherwise than in payment for a just demand, and with intent to defraud, omits to make or to cause or direct to be made a full and true entry thereof in its books a"nd accounts ; or, 2. Concurs in omitting to make any material entry thereof ; or 8 3. Knowingly concurs in making or publishing any written report, exhibit or statement of its affairs or pecuniary condition, containing any material statement which is false; or, 4. Having the custody or control of its books, willfully refuses or neglects to make any proper entry in the stock book of such corpora- tion as required by law, or to exhibit or allow the same to be inspected and extracts to be taken therefrom by any person entitled by law to inspect the same or take extracts therefrom. Anvd by chap. 692 of 1893. In effect October 1, 1893, 5. If a notice of an application for an injunction affecting the prop- erty or business of such joint-stock association or corporation is served upon him omits to disclose the fact of such service and the time and place of such application to the other directors, officers and managers thereof; or, 6. Refuses or neglects to make any report or statement lawfully required by a public officer ; Is guilty of a misdemeanor. 612. Misconduct of officers and agents of pipe-line cor- porations. Any officer, agent or manager of a pipe-line corporation, who : 1. Neglects or refuses to transport any product delivered for trans- portation, or to accept and allow a delivery thereof in the order of application, according to the general rules of the corporation as pro- vided by law ; or, 2. Charges, accepts or agrees to accept for such receipt, transporta- tion and delivery, a sum different from the amount fixed by such regulations ; or, 3. Allows or pays, or agrees to allow or pay, or suffers to be allowed or paid or repaid, any draw-back, rebate or allowance, so that any person shall, by any device, have or procure any transportation of products over such pipe-line at a less rate or charge than is fixed in such regulations; Is guilty of a misdemeanor, punishable by a fine not exceeding or^e thousand dollars, or by imprisonment not exceeding six months, or by both. 613. Misconduct of corporate elections. Any person who: 1. Votes or issues a proxy to vote at any meeting of the stockholders or bondholders, or both, of a stock corporation, upon any stock or bond, if the person in whose behalf such vote is given shall not then have the title to the stock represented by such certificate or to 'such bond, and shall not have it in his possession and control, notwith- standing such stock or bond shall then stand on the books of such corporation in the name of the person in whose behalf such vote is given ; or, 2. Being entitled to vote at such meeting, sells his vote or issues a 9 proxy to vote to any person for any sum of money or thing of value ; or, 3. Acts as an inspector of election at any such meeting and violates an oath taken by him, in pursuance of law as such inspector, or vio- lates the provisions of an oath required by law to be taken by him as such inspector, or is guilty of any dishonest or corrupt conduct as such inspector; Is guilty of a misdemeanor. 614. Presumption of knowledge of corporate condition and business and of assent thereto by directors ; definitions. It is no defense to a prosecution for a violation of the provisions of this chapter, that the corporation is a foreign corporation, if it carries on business or keeps an office therefor in this state. The term "director" -as used in this chapter includes^ any of the persons having, by law, the direction or management of the affairs of a corporation, by whatever name described. A director of a corporation or joint-stock association i| deemed to have such a knowledge of the affairs of the corporation or association as to enable him to determine whether any act, proceeding or omission of ir,s directors is a violation of this chapter. If present at a meeting of the directors at which any act, proceeding or omission of such directors in violation of this chapter occurs, he must be deemed to have concurred therein, unless he at th^ time causes or in writing requires his dissent therefrom to be ent : id n the minutes of the directors. If absent from such meeting, he t.stbe deemed to have concurred in any such violation, if the facts 'o-.sti'-ting such violation appear on the record or minutes of the proceedings ;f the board of directors, and he remains a director of the corporation for six months thereafter with- out causing or in writing requiring his dissent rifv from some person who has a right to give such authority, is punishable as follows : First, if thereby the safety of any person is endangered, by imprisonment for not more than twenty years. Second, In every other case by imprisonment for not more than five years, [Am'd. ch. 183 of 1897. In effect Sept. 1, 1897.] 641. A person who, either 1. Wrongfully obtains, or attempts to obtain, any knowledge of a tele graphic or telephonic message by connivance with a clerk, operator, messen- ger, or other employe of a telegraph or telephone company; or 2. Being such clerk, operator, messenger or other employe, willfully divulges to anyone but the persons for whom it was intended, the contents or the nature thereof of a telegraphic or telephonic message or dispatch in- trusted to him for the transmission or delivery, or of which contents he may in any manner become possessed, or occupying such position in a telegraph offiVe si i all willfully refuse or neglect duly to transmit or deliver messages reoe vj I ax such office, except when such telegraphic or telephonic message or dispatch is in aid of or used to abet or carry on any unlawful business or traffic, or to perpetrate any criminal offense, and when it shall appear that any offense at law or unlawful business or traffic is being carried on or con- ducted in whole or in part by means of a telegraphic or telephonic message or dispatch, it shall be the duty of any corporation or employe thereof having knowledge of the same, to withhold such dispatch from delivery until the person to whom it is addressed shall be fully identified, and to further furnish to any public officer whose duty it is to prosecute any offense at law so aided and abetted, all information in their possession, relating to said unlawful business or traffic; and to further assist in the identification of any person aiding or abetting in or conducting any such unlawful business or traffic, Is punishable by a fine of not more than one thousand dollars, or by im- prisonment for not more than six months, or by both such" fine and imprison- ment. Am'd by chap. 727 of 1895. To go into effect Sept. 1, 1895. 642. A person who, willfully, and without authority, either 1. Opens or reads, or causes to be opened or read, a sealed letter, telegram, or private paper; or 2. Publishes the whole or any portion of such a letter, or telegram, or pri- vate paper, knowing it to have been opened or read without authority; or 3. Tak'es a letter, telegram or private paper, belonging to another or a copy thereof, and publishes the whole or any portion thereof; or 4. Publishes the whole or any portion of such letter, telegram or private paper, knowing it to have been taken or copied without authority, is guilty of a misdemeanor. Am'd by chap. 287 of 1895. To take effect Sept. 1, 1895. THE TAX LAW OF THE STATE OF NEW YORK BEING L. 1896, Chap. 908, entitled "An Act in Relation to Taxa- tion, Constituting Chapter Twenty-four of the General Laws," with all Amendments and Additions thereto Passed during the Legislative Sessions of 1897 to 1905, both inclusive. INCLUDING THE RECORDING TAX ACT OF 1906, RELATING TO TAXATION OF MORTGAGES OF REAL PROPERTY IMPORTANT AMENDMENTS TO THE STOCK TRANSFER ACT OF 1905. COMPLETELY INDEXED 1906 COMPLETE EDITION BANKS & COMPANY ALBANY, N. Y. 1905 COPYBIGHT, 1905, BY BAKER, VOORHIS & COMPANY. COPYRIGHT, 1906. BY BAKER, VOORHIS & COMPANY. THE TAX LAW. [WiTH AMENDMENTS OP 1897, 1898, 1899, 1900, 1901, 1902, 1903, 1904 1905 AND 1906.] L. 1896, Chap. 908, An Act in Relation to Taxation, Constituting Chap. 34 of the General Laws. CHAPTER XXIV OF THE GENERAL LAWS. THE TAX LAW. Article 1. Taxable property and place of taxation. ( 1-14.) 2. Mode of assessment. ( 20-47.) 3. Equalization of assessment and levy of tax. ( 50-59.) 4. Collection of taxes. ( 70-95.) 5. Collection of nonresident taxes. ( 100-109.) 6. Sales by comptroller for unpaid taxes and redemption of lands. ( 120-143.) 7. Sales by county treasurers for unpaid taxes and redemp- tion of lands. ( 150-158.) 8. State board of tax commissioners, state board of equaliza- tion. ( 170-177.) 9. Corporation tax. ( 180-203.) 10. Taxable transfers. ( 220-243.) 11. Procedure. ( 250-264.) 12. Laws repealed; when to take effect. ( 280-281.) 13. Limitation of time. ( 282.) 14. Mortgage debts secured by real property within this state. ( 290-314. Added by L. 1905, chap. 729.) 15. Tax on transfers of stock. ( 315-324. Added by L. 1905, chap. 241.) ARTICLE I. TAXABLE PROPERTY AND PLACE OF TAXATION. Section 1. Short title. 2. Definitions. 3. Property liable to taxation. 4. Exemption from taxation. 5. Taxation of lands sold or leased by the state. 6. No deduction allowed for indebtedness fraudulently con- tracted. 7. When property of nonresidents is taxable. 8. Place of taxation of property of residents. 9. Place of taxation of real property. 10. Taxation of real property divided by line of tax district. 11. Place of taxation of property of corporations. 12. Taxation of corporate stock. 13. Stockholders of bank taxable on shares. 14. Place of taxation of individual bank capital. 4 THE TAX LAW. Section 1. Short title. This chapter shall he known as the tax law. 2. Definitions. 1. " Tax district." as used in this chap- ter, means a political subdivision of the state having a board of assessors authorized to assess property therein for state and county taxes. 2. " County treasurer " includes any officer performing the duties devolving upon such office under whatever name. 3. The terms " land," " real estate," and " real property," as used in this chapter, include the land itself above and under water, all buildings and other articles and structures, substructures and superstructures, erected upon, under or above, or affixed to the same; all wharves and piers, includ- ing the value of the right to collect wharfage, cranage or dockage thereon ; all bridges, all telegraph lines, wires, poles and appurtenances ; all supports and inclosures for electrical conductors and other appurtenances upon, above and under ground; all surface, under ground or elevated, railroads, including the value of all franchises, rights or permission to construct, maintain or operate the same in, under, above, on or through, streets, highways, or public places; all rail- road structures, substructures and superstructures, tracks and the iron thereon ; branches, switches and other fixtures permitted or authorized to be made, laid or placed in, upon, above or under any public or private road, street or ground ; all mains, pipes and tanks laid or placed in, upon, above or under any public or private street or place for conducting steam, heat, water, oil, electricity or any property, substance or product capable of transportation or conveyance therein or that is protected thereby, including the value of all fran- chises, rights, authority or permission to construct, maintain or operate, in, under, above, upon, or through, any streets, highways, or public places, any mains, pipes, tanks, con- duits, or wires, with their appurtenances, for conducting water, steam, heat, light, power, gas, oil, or other substance, or electricity for telegraphic, telephonic or other purposes; all trees and underwood growing upon land, and all mines, minerals, quarries and fossils in and under the same, ex- cept mines belonging to the state. A franchise, right, au- thority or permission specified in this subdivision shall for THE TAX LAW. 5 the purpose of taxation be known as a " special franchise." A special franchise shall be deemed to include the value of the tangible property of a person, copartnership, association or corporation situated in, upon, under or above any street, highway, public place or public waters in connection with the special franchise. The tangible property so included shall be taxed as a part of the special franchise. No prop- erty of a municipal corporation shall be subject to a special franchise tax. (Thus amended by L. 1899, chap. 712, tak- ing effect October 1, 1899.) This subdivision was amended by what ia known as the " Franchise Tax Law." Sections 42, 43, 44. 45, 46 and 47 were added to Article II of the Tax Law, and sections 21, 31 and 37 were amended by the same law. 4. The term special franchise shall not be deemed to in- clude the crossing of a street, highway or public place where such crossing is not at the intersection of another street or highway, unless such crossing shall be at other than right angles for a distance of not less than two hundred and fifty feet, in which case the whole of such crossing shall be deemed a special franchise. This subdivision shall not apply to any elevated railroad. (Inserted by L. 1901, chap. 490, taking effect April 23, 1901.) 5. The terms " personal estate ", and " personal prop- erty," as used in this chapter, include chattels, money, things in action, debts due from solvent debtors, whether on account, contract, note, bond or mortgage; debts and obligations for the payment of money due or owing to per- sons residing within this state, however secured or wher- ever such securities shall be held ; debts due by inhabitants of this state to persons not residing within the United States for the purchase of any real estate ; public stocks, stocks in moneyed corporations, and such portion of the capital of incorporated companies, liable to taxation on their capital, as shall not be invested in real estate. (Subdivision re- numbered by L. 1901, chap. 490, taking effect April 23, 1901.) 3. Property liable to taxation. All real property within this state, and all personal property situated or owned within this state, is taxable unless exempt from taxation bv law. 6 THE TAX LAW. 4. Exemption from taxation The following property shall be exempt from taxation : 1. Property of the United States. 2. Property of this state other than, its. wild or forest lands in the forest preserve. 3. Property of a municipal corporation of the state held for a public use, except the portion of such property not within the corporation. 4. The lands in any Indian reservation owned by the Indian nation, tribe or band occupying them. 5. All property exempt by law from execution, other than an exempt homestead. But real property purchased with the proceeds of a pension granted by the United States for military or naval services, and owned and occupied by the pensioner, or by his wife or widow, is subject to taxation as herein provided. Such property shall be assessed in the same manner as other real property in the tax districts. At the meeting of the assessors to hear the complaints concern- ing assessments, a verified application for the exemption of such real property from taxation may be presented to them by or on behalf of the owner thereof, which applica- tion must show the facts on which the exemption is claimed, including the amount of pension money used in or toward the purchase of such property. If the assessors are satisfied that the applicant is entitled to the exemption, and that the amount of pension money used in the purchase of such property equals or exceeds the assessed valuation thereof, they shall enter the word " exempt " upon the assessment- roll opposite the description of such property. If the amount of such pension money used in the purchase of the property is less than the assessed valuation, they shall enter upon the assessment-roll the words " exempt to the extent of dollars " (naming the amount) and thereupon such real property, to the extent of the exemption entered by the assessors, shall be exempt from state, county and gen- eral municipal taxation, but shall be taxable for local school purposes, and for the construction and maintenance of streets and highways. If no application for exemption be granted, the property shall be subject to taxation for all pur- poses. The entries above required shall be made and con- THE TAX LAW. 7 tinned in each assessment of the property 90 long as it is exempt from taxation for any purpose. The provisions herein, relating to the assessment and exemption of prop- erty purchased with a pension, apply and shall be enforced in each municipal corporation authorized to levy taxes. (Thus amended by L. 1897, chap. 347.) 6. Bonds of this state to be hereafter issued by the comp- troller to carry out the provisions of chapter seventy-nine of the laws of eighteen hundred and ninety-five, and bonds of a municipal corporation heretofore issued for the purpose of paying up or retiring the bonded indebtedness of such cor- poration. (Thus amended by L. 1897, chap. 80.) 7. The real property of a corporation or association or- ganized exclusively for the moral or mental improvement of men or women, or for religious, bible, tract, charitable, benevolent, missionary, hospital, infirmary, educational, sci- entific, literary, library, patriotic, historical or cemetery purposes, or for the enforcement of laws relating to children or animals, or for two or more such purposes, and used ex- clusively for carrying out thereupon one or more of such purposes ; and the personal property of any such corporation shall be exempt from taxation. But no such corporation or association shall be entitled to any such exemption if any officer, member or employe thereof shall receive or may be lawfully entitled to receive any pecuniary profit from the operations thereof except reasonable compensation for ser- vices in effecting one or more of such purposes, or as proper beneficiaries of its strictly charitable purposes ; or if the or- ganization thereof, for any such avowed purposes, be a guise or pretense for directly or indirectly making any other pe- cuniary profit for such corporation or association, or for any of its members or employes, or if it be not in good faith organized or conducted exclusively for one or more of such purposes. The real property of any such corporation or as- sociation entitled to such exemption held by it exclusively for one or more of such purposes and from which no rents, profits or income are derived, shall be so exempt, though not in actual use therefor by reason of the absence of suit- able buildings or improvements thereon, if the construction of such buildings or improvements is in progress, or ie in 8 THE TAX LAW. good faith contemplated by such corporation or association; or if such real property is held by such corporation or association upon condition that the title thereto shall revert in case any building not intended and suitable for one or more of such pur- poses shall be erected upon said premises or some part thereof.. The real property of any such corporation not so used exclusively for carrying out thereupon one or more of such purposes, but leased or otherwise used for other purposes, shall not be exempt, but if a portion only of any lot or building of any such corpora- tion or association is used exclusively for carrying out thereupon one or more such purposes of any such corporation or associa- tion, then such lot or building shall be so exempt only to the extent of the value of the portion so used, and the remaining or other portion to the extent of the value of such remaining or other portion shall be subject to taxation; provided, however, that a lot or building owned, and actually used for hospital pur- poses, by a free public hospital, depending for maintenance and support upon voluntary charity shall not be taxed as to a por- tion thereof leased or otherwise used for the purposes of income, when such income is necessary for, and is actually applied to, the maintenance and support of such hospital, and further provided that the real property of any fraternal corporation, association or body created to build and maintain a building or buildings for its meeting or meetings of the general assembly of its members, or subordinate bodies of such fraternity and for the accommodation of other fraternal bodies or associations, the entire net income of which real property is exclusively applied or to be used to build, furnish and maintain an asylum, or asylums, a home or homes, a school or schools for the free education or relief of the members of such fraternity or for the relief, support and care of worthy and indigent members of the fraternity, their wives, widows or orphans, shall be exempt from taxation. Property held by any officer of a religious denomina- tion shall be entitled to the same exemptions, subject to the same conditions and exceptions, as property held by a religious corporation. (Thus amended &?/ L. 1897, chap. 371, L. 1903,, chap. 204, and L. 1906, chap. 336, taking effect April 27, 1906.) 8. Real property of an incorporated association of present or former volunteer firemen actually and exclusively used and occupied by such corporation and not exceeding in value fifteen thousand dollars. 9. All dwelling-houses and lots of religious corporations while actually used by the officiating clergymen thereof, but the total amount of such exemption to any one religious corporation shall not exceed two thousand dollars. Such exemption shall be in addition to that provided by subdivision seven of this section. 10. The real property of an agricultural society permanently used by it for exhibition grounds. THE TAX LAW. 9 11. The real property of a minister of the gospel or priest who is regularly engaged in performing his duties as such, or permanently disabled, by impaired health from the performance of such duties, or over seventy-five years of age, and the per- sonal property of such minister or priest, but the total amount of such exemption on account of both real and personal property shall not exceed fifteen hundred dollars. 12. All vessels registered at any port in this state and owned by an American citizen, or association, or by any corporation, incorporated under the laws of the state of Xew York, engaged in ocean commerce between any port in the United States and. any foreign port, are exempted from all taxation in this state, for state and local purposes; and all such corporations, all of whose vessels are employed between foreign ports and ports in the United States, are exempted from all taxation in this state, for state and local purposes, upon their capital stock, franchises and earnings, until and including December thirty-first, nine- teen hundred and twenty-two. 13. A bond, mortgage, note, contract, account or other de- mand, belonging to any person not a resident of this state, sent to or deposited in this state for collection; the products of another state, owned by a nonresident of this state and con- signed to his agent in this state for sale on commission for the benefit of the owner; moneys of a nonresident in this state, under the control or in the possession of his agent in this state, when transmitted to such agent for the purpose of investment or otherwise. 14. The deposits in any bank for savings which are due depositors, the accumulations in any domestic life insurance corporation, held for the exclusive benefit of the insured, other than real estate and stocks, now liable for taxation; the accumulations of any incorporated co-operative loan association upon the shares of such association held by any person; and personal property of any corporation, person, company or association transacting the business of fire, cas- ualty or surety insurance in this state equal in value to the unearned premiums required by the laws of this state, or the regulations of its insurance department, to bo charged as a liability. (Thus amended by L. 1901, chap. 618, in effect April 29, 1901.) 15. Moneys collected in the course of the business of any corporation, association or society doing a life or casualty insurance business or both, upon the co-operative or assess- ment plan, and which are to be used for the payment of as- 10 THE TAX LAV. sessmenta, or for death losses or for benefits to disabled members. 16. The owner or holder of stock in an incorporated company liable to taxation on its capital, shall not be taxed as an indi- vidual for such stock. 17. The personal property in excess of one hundred thousand dollars of a mutual life insurance corporation incorporated in this state before April tenth, eighteen hundred and forty-nine. 18. Property real, from which no income is derived, and personal property, situated within any city of the first class and belonging to the medical society of any county, which county is either wholly or partly within such city and which society was heretofore incorporated under the provisions of chapter ninety-four, laws of eighteen hundred and thirteen, entitled "An act to incorporate medical societies for the purpose of regulating the practice of physic" and surgery in this state," provided that such property is used for the purposes of such a society and not otherwise, and provided that such exemption of property for any society in the counties of Kings or New York, shall not exceed one hundred and fifty thousand dollars, and in any other county affected hereby, shall not exceed fifty thousand dollars. (Added by L. 1903, chap. 199.) 19. Property real from which no rent is derived and personal prop- erty, situated within any city of the first class and belonging to any incorporated pharmaceutical society of any county which is either wholly or partly within such city, which society has heretofore been or may hereafter be authorized and empowered by act of the legislature to establish and which has established or may hereafter establish, a college of pharmacy in 'such city; provided that such property is used for the purposes of such college and not otherwise, and provided also that the exemption of such property for any society in the counties of Kings and New York shall not exceed one hundred 'thousand dollars and in any other county affected hereby, shall not exceed fifty thousand dollars. (Added by L. 1905, chap. 446.) 5. Taxation of lands sold or leased by the state. All lands which have been sold by the state, although not conveyed, shall be assessed in the same manner as if such purchaser were the actual owner. Where land is leased by the state such leasehold interest, except in cases where by the terms of the lease the state is to pay the taxes imposed upon the property leased, shall be assessed to the lessee or occupant in the tax district where the land is situated. (Thus amended by L. 1897, chap. 443.) 6. No deduction allowed for indebtedness fraudulently contracted. No deduction shall be allowed in the assessment of personal property by reason of the indebtedness of the owner contracted or incurred in the purchase of nontaxable property or securities owned by him or held for his benefit, nor for or on account of any indirect liability as surety, guarantor, indorser or otherwise, nor for or on account of any debt or liability contracted or incurred for the purpose of evading taxation. 7. When property of nonresidents is taxable. Subdivision 1. Non- residents of the state doing business in the state, either as principals or partners, shall be taxed on the capital invested in such business, as personal property, at the place where such business is carried on, to the same extent as if they were residents of the state. 2. The personal property of nonresidents of the state having an actual situs in the state, and not forming a part of capital invested in business in the state, shall be assessed in the name of the owner thereof for the purpose of identification and taxed in the tax district where such prop- THE TAX LAW. 11 erty is situated, unless exempt by law. This subdivision shall not apply to money, or negotiable collateral securities, deposited by, or debts owing to, such nonresidents nor shall it be construed as in any manner modifying or changing the law imposing a tax on real estate mortgage securities. (Amended by L. 1906, chap. 248, taking effect April 16, 1906.) 8. Place of taxation of property of residents. Every person shall be taxed in the tax district where he resides when the assessment for taxation is made, for all personal property owned by him, or under his control as agent, trustee, guardian, executor or administrator. Where taxable personal property is in the possession or under the con- trol of two or more agents, trustees, guardians, executors or adminis- trators residing in different tax districts, each shall be taxed for an equal portion of the value of such property so held by them. Rents reserved in any lease in fee or for one or more lives or for a term more than twenty-one years and chargeable upon real property within the state, shall be taxable to the person entitled to receive the same, as personal property in the tax district where such real property is situated, and for the purpose of the taxation thereof such person is to be deemed a resident of such tax district. When a person shall have acquired a residence in a tax district, and shall have been taxed therein, such residence shall be presumed to continue for the purpose of taxation until he shall have acquired another residence in this state or shall have removed from this state. The residence of a person on July first shall be deemed his residence for the purpose of assessment and taxation during that year. If he shall have actually and in good faith changed Ids residence after July first, and before August first in any year, from one tax district to another, and shall make proof to the assessors at or before their last meeting for the correction of the assessment-roll of such change of residence and that he is assessed in the tax district to which he has removed, his name and the assessment of his personal property shall be stricken from the assessment-roll of the tax district whore he resided on July first. In case of any controversy as to the proper place of taxation within the state of any person, his residence for purposes of taxation may be determined by the state board of tax commissioners, subject to review by the court. 9. Place of taxation of real property. When real prop- erty is owned by a resident of a tax district in which it is situated, it shall be assessed to him. When real property is owned by a resident outside the tax district where it is situated, and is occupied, and the occupant is a resident of the tax district, it shall be assessed to either the owner or 12 THE TAX LAW. occupant. If the occupant resides out of the tax district or if the land is unoccupied, it shall be assessed as non-resi- dent, as hereinafter provided by article two. In all cases the assessment shall be deemed as against the real property itself, and the property itself shall be holden and liable to sale for any tax levied upon it. (Thus amended by L. 1902, chap. 171, in effect April 4, 1902.) 10. Taxation of real property divided by line of tax dis- trict. If a farm or lot is divided by a line between two or more tax districts it shall be assessed in the tax district in which the dwelling house or other principal buildings are located, in the manner provided by section nine of this chap- ter, the same as though such farm or lot was wholly in such tax district, except that if the land is unoccupied or has not buildings thereupon, the portion of such farm, lot or tract of land lying in each district shall be separately assessed therein. If such land is situated in two or more - counties and is wild and uncultivated and not occupied and used for agricultural purposes, the portions of such land lying in each county shall be separately assessed therein. If the boundary line of a tax district passes through a building, any portion of which is used as a dwelling, the owner of such building, if occupying the same or residing in either tax district, and otherwise, the person occupying such build- ing as a dwelling-house, may elect in which district such building and the adjacent land, owned, occupied and con- nected therewith shall be assessed, by serving a written notice of such election on the assessors of each tax district during the month of May; but if such election is not made, the property shall be assessed in the tax districts in which it is located. (Thus amended by L. 1898, chap. 537, and L. 1902, chap. 200, and L. 1903, chap. 305.) 11. Place of taxation of property of corporations The real estate of all incorporated companies liable to taxation, shall be assessed in the tax district in which the same shall lie, in the same manner as the real estate of individuals. All the personal estate of every incorporated company liable to taxation on its capital shall be assessed in the tax district THE TAX LAW. 13 where the principal office or place for transacting the finan- cial concerns of the company shall be, or if such company have no principal office, or place for transacting its finan- cial concerns, then in the tax district where the operations of such company shall be carried on. In the case of toll- bridges, the company owning such bridge shall be assessed in the tax district in which the tolls are collected ; and where the tolls of any bridge, turnpike, or canal company are col-* lected in several tax districts, the company shall be assessed in the tax district in which the treasurer or other officer authorized to pay the last preceding dividend resides. 12. Taxation of corporate stock. The capital stock of every company liable to taxation, except such part of it as shall have been excepted in the assessment-roll or shall be exempt by law, together with its surplus profits or reserve funds exceeding ten percentum of its capital, after deduct- ing the assessed value of its real estate, and all shares of stock in other corporations actually owned by such company which are taxable upon their capital stock under the laws of this state, shall be assessed at its actual value. 13. Stockholders o-f bank taxable on shares. The stock- holders of every bank or banking association organized under the authority of this state, or of the United States, shall be assessed and taxed on the value of their shares of stock therein ; said shares shall be included in the valuation of the personal property of such stockholders in the assessment of taxes in the tax district where such bank or banking as- sociation is located, and not elsewhere, whether the said stockholders reside in said tax district or not. 14. Place of taxation of individual bank capital. Every individual banker shall be taxable upon the amount of capi- tal invested in his banking business in the tax district where the place of such business is located and shall, for that pur- pose, be deemed a resident of such tax district. 13a THE TAX LAW. 15. Report of exempt property. It shall be the duty of the board of assessors of the several towns of this state, and the boards or officials charged with the duty of assessing property for the purposes of taxation in the several cities of the state, to furnish to the clerks of the boards of supervisors of their respective counties, or in the case of the city of New York, to the city clerk of that city, on or before the first day of July in each year, a full and complete list and statement of all property situated within their respective districts exempt from taxation under the laws of his state. Such list and statement shall be made on blanks furnished by the state board of tax commissioners, and in such form and to contain and set forth all the information relative to such property and the situation and value thereof, as may be required by the state board of tax commissioners, and to be verified in the same manner as assessments of property for the purposes of taxation and in the city of New York by the chief deputy of the department of taxes and assessments. The state board of tax commissioners shall prepare and trans- mit to the clerk of the board of supervisors in each county and to the city clerk of the city of New York, a sufficient number of such blanks, on or before the first day of May in each year, and the clerks of the boards of supervisors and the city clerk of the city of New York shall forthwith, upon the receipt thereof, distribute the same among the boards of assessors for use in preparing the statement herein re- quired. And it shall be the duty of the clerk of the board of supervisors of each county and of the city clerk of the city of New York, to transmit such completed lists or statements to the state board of tax commissioners, on or before the first day of August in each year, and the state board of tax com- missioners shall tabulate such statements, and on or before the first day of February in each year, cause to be published in their annual report to the legislature, a complete tabulated statement, based upon the statement so transmitted to the state board of tax commissioners, of all real estate in the several counties of the state, which is exempt from taxation. Immediately upon the receipt of the completed reports by THE TAX LAW. 13b the various clerks of the board of supervisors, and the city clerk of the city of New York, those officials shall prepare a tabulated statement of the returns received and shall post a copy thereof in a conspicuous place, and in all cities of the state cause a copy thereof to be published in the official paper or papers of said city at least once in each week for three successive weeks. The expense of such publication shall be a city charge and shall be audited and paid in the same manner as charges for other city notices are audited and paid. (Added by L. 1904, chap. 438.) L. 1904, ch. 438. 2. Chapter six hundred and eighty-nine of the laws of nineteen hundred is hereby repealed. 14 THE TAX LAW. ARTICLE II. MODE OF ASSESSMENT. Section 20. Ascertaining facts for assessment. 21. Preparation of assessment-roll. 22. Assessment of state lands in forest preserve. 23. Banks to make report. 24. Bank shares, how assessed. 25. Individual banker, how assessed. 26. Notice of assessment to bank or banking association. 27. Reports of corporations. 28. Penalty for omission to make statement. 28a. County clerks to furnish data respecting corporations. 29. Assessment of real property of nonresident. 30. Surveys and maps of nonresident real property. 31. Corporations, how assessed. 32. Assessment of agent, trustee, guardian or executor. 33. Assessment of omitted property. 34. Debts owing to nonresidents of United States, how assessed. 35. Notice of completion of assessment-roll. 36. Hearing of complaints. 37. Correction and verification of tax-roll. 38. Filing of roll and notice thereof. 39. Assessors to apportion valuation of railroad, telegraph, tele- phone, or pipe line companies between school districts. 40. Neglect or omission of duty by assessors. 41. Abandonment of lot divisions. 42. Assessment of special franchises. 43. Report to state board of tax commissioners. 44. Hearing on special franchise assessment. 45. Certiorari to review assessment. 45a. Id ; Appearance by state board by special counsel ; payment of his costs, expenses and disbursements. 46. Deduction from special franchise tax for local purposes. 47. Special franchise tax not to affect other tax. 20. Ascertaining facts for assessment. The assessors in each tax district may, by mutual agreement, divide it into convenient assessment districts not exceeding the number of such assessors. The assessors in each tax district shall annually, between May first and July first, ascertain by dili- gent inquiry all the property and the names of all the per- sons taxable therein, except that in towns containing an in- corporated village having a population of more than ten thousand inhabitants according to the last state census thei assessors may have from April fifteenth until July first to THE TAX LAW. 15 ascertain the taxable property and names of persons taxable in such town, and except that in towns containing an incorporated city having a population of more than ten thousand inhabitants according to the last state census where said city so situated shall have its own separate board of assessors, the town as- sessors may have from May first to July first to ascertain the taxable property and names of persons taxable in such towns. (Thus amended by L. 1902, chap. 324, and L. 1905, chap. 61, in effect March 15, 1905.) 21. Preparation of assessment-roll. They shall prepare an assessment-roll containing six separate columns, and shall, ac- cording to the best information in their power, set down: 1. In the first column the names of all taxable persons in the tax district. 2. In the second column the quantity of real property taxable to each person, with a statement thereof in such form as the commissioners of taxes shall prescribe. 3. In the third column the full value of such real property. 4. In the fourth column the full value of all the taxable per- sonal property owned by each person respectively after deduct- ing the just debts owing by him. 5. In the fifth column the value of taxable rents reserved and chargeable upon lands within the tax district, estimated at a principal sum, the interest of which, at a legal rate per annum, shall produce a sum equal to such annual rents, and if payable in any other thing except money, the value of the rents in money to be ascertained by them and the value of each rent as- sessed separately, and if the name of the person entitled to re- ceive the rent assessed cannot be ascertained by the assessors, it shall be assessed against the tenant in possession of the real property upon which the rents are chargeable. 6. In the sixth column the value of the special franchise as fixed by the state board of tax commissioners. (Amended by L. 1899, chap. 712, taking effect October 1, 1899.) 7. Such assessment-roll shall contain two additional columns, in one of which shall be inserted the amount of the tax levied against each person named therein, and in the other the date of the payment of such tax. (Inserted by L. 1901, chap. 159, taking effect March 22, 1901.) 16 THE TAX LAW. L. 1898, Chap. 610, An Act to Legalize Certain Assessments. Section 1. An assessment of real or personal property heretofore made shall not be deemed invalid because the property was assessed to the " estate " of a decedent, instead of to his personal representatives, devisees, legatees, heirs, or next of kin. 2. Nothing in this act contained shall affect any legal action now pending. 3. This act shall take effect immediately. 22. Assessment of state lands in forest preserve All wild or forest lands within the forest preserve shall be as- sessed and taxed at a like valuation and rate as similar lands of individuals within the counties where situated. On or before August first in every year the assessors of the town within which the lands so belonging to the state are situated shall file in the office of the comptroller and of the board of fisheries, game and forest, a copy of the assessment-roll of the town, which, in addition to the other matter now re- quired by law, shall state and specify which and how much, if any, of the lands assessed are forest lands, and "which and how much, if any, are lands belonging to the state; such statements and specifications to be verified by the oaths of a majority of the assessors. The comptroller shall there- upon, and before the first day of September following, and after hearing the assessors and the board of fisheries, game and forest, if they or any of them so desire, correct or re- duce any assessment of state lands which may be in his judg- ment an unfair proportion to the remaining assessment of land within the town, and shall in other respects approve the assessment and communicate such approval to the as- sessors. No such assessment of state lands shall be valid for any purpose until the amount of assessment is approved by the comptroller, and such approval attached to and de- posited with the assessment-roll of the town, and therewith delivered by the assessors of the town, to the supervisor thereof or other officer authorized to receive the same from the assessors. No tax for the erection of a schoolhouse or opening of a road shall be imposed on the state lands unless such erection or opening shall have first been approved in writing by the board of fisheries, game and forest. THE TAX LAW. 17 23. Banks to make report. The chief fiscal officer of every bank or banking association organized under the au- thority of this state, or of the United States, shall, on or before the first day of July, in each year, furnish the as- sessors of the tax district in which its principal office is lo- cated a statement under oath of the condition of such bank or banking association on the first day of June next preced- ing, stating the amount of its authorized capital stock, the number of shares and the par value of the shares- thereof, the amount of stock paid in, the amount of its surplus and of its undivided profits, if any, a complete list of the names and residences of its stockholders and the number of shares held by each. In case of neglect or refusal on the part of any bank or banking association to report as herein prescribed, or to make other or further reports as may be required such bank or banking association shall forfeit the sum of one hun- dred dollars for each failure, and the additional sum of ten dollars for each day such failure continues, and an action, therefor shall be prosecuted by the county treasurer of the county in which such bank or banking association so neg- lecting or refusing to report is located, and in the city of New York by the receiver of taxes thereof. There shall, in addition to such report, be kept in the office of every such bank or banking association a full and correct list of the names and residences of all stockholders therein, and of the number of shares held by each, and such lists shall be sub- ject to the inspection of the assessors at all times. The list of stockholders furnished by such bank or banking associa- tion shall be deemed to contain the names of the owners of such shares as are set opposite them, respectively, for the purpose of assessment and taxation. (Thus amended, by L~ 1901, chap. 550, in effect April 25, 1901.) 24. Bank shares, how assessed. In assessing the shares of stock of banks or banking associations organized under the authority of this state or the United States, the assessment and taxation shall not be at a greater rate than is miade or assessed upon other monied capital in Hie hands of individual citizens of this state. The value of each share of stock of each bank and banking association, except such as are in liquidation, shall be ascertained and fixed by adding together the amount of the capital stock, surplus, and undivided profits of such bank or 18 THE TAX LAW. banking association and by dividing the result by the number ot outstanding shares of such bank or banking association. The value of each share of stock in each bank or banking association in liquidation shall be ascertained and fixed by dividing the actual assets of such bank or banking association by the number of outstanding shares of such bank or banking association. The rate of tax upon the shares of stock of banks and banking associations shall be one per centum upon the value thereof, as ascertained and fixed in the manner hereinbefore pro- vided, and the owners of the stock of banks and banking as- sociations shall be entitled to no deduction from the taxable value of their shares because of the personal indebtedness of such owners, or for any other reason whatsoever. Com- plaints in relation to the assessments of the shares of stock of banks and banking associations made under the provisions of this act shall be heard and determined as provided in ar- ticle two, section thirty-six, of the tax law. The said tax shall be in lieu of all other taxes whatsoever for state, county or local purposes upon the said shares of stock, and mort- gages, judgments and other choses in action and -personal property held or owned by banks or banking associations, the value of which enters into the value of said shares of stock, shall also be exempt from all other state, county or local taxation. The tax herein imposed shall be levied in the following manner : The board of supervisors of the sev- eral counties shall, on or before the fifteenth day of Decem- ber in each year, ascertain from an inspection of the assess- ment-rolls in their respective counties, the number of shares of stock of banks and banking associations in each town, city, village, school and other tax district, in their several coun- ties, respectively, in which such shares of stock are taxable, the names of the banks issuing the same, respectively, and the assessed value of such shares, as ascertained in the man- ner provided in this act and entered upon the said assess- ment-rolls, and shall forthwith mail to the president or cashier of each of said banks or banking associations a state- ment setting forth the amount of its capital stock, surplus and undivided profits, the number of outstanding shares thereof, the value of each share of stock taxable in said county, as ascertained in the manner herein provided, and the aggregate amount of tax to be collected and paid by such bank and banking association, under the provisions of this act. A certified copy of each of said statements shall be sent to the county treasurer. It shall be the duty of every THE TAX LAW. 19 bank or banking association to collect the tax due upon its shares of stock from the several owners of such shares, and to pay the same to the treasurer of the county wherein said bank or banking association is located, and in the city of New York to the receiver of .taxes thereof on or before the thirty-first day of December in said year ; and any bank or banking association failing to pay the said tax as herein provided shall be liable by way of penalty for the gross amount of the taxes due from all owners of the shares of stock, and for an additional amount of one hundred dollars for every day of delay in the payment of said tax. Every bank or banking association so paying the taxes due upon the shares of its stock shall have a lien on the shares of stock, and on all property of the several share owners in its hands, or which may at any time come into its hands, for reimbursement of the taxes so paid on account of the several shareholders, with legal interest ; and such lien may be enforced in any appropriate manner. The tax hereby imposed shall be distributed in the following manner : The board of supervisors of the several counties shall ascertain the tax rate of each of the several town, city, village, school and other tax districts in their counties, respectively, in which the shares of stock of banks and banking associations shall be taxable, which tax rates shall in- clude the proportion of state and county taxes levied in such districts, respectively, for the year for which the tax is imposed, and the proportion of the tax on bank stock to which each of said districts shall be respectively entitled shall be ascertained by taking such proportion of the tax upon the shares of stock of banks and banking associations, taxable in such districts re- spectively, under the provisions of this act as the tax rate of such tax district shall bear to the aggregate tax rates of all the tax districts in which said shares of stock shall be taxable. The clerk of the several cities, villages and school districts to which any portion of the tax on shares of stock of banks and banking associations is to be distributed under this act shall, in writing and under oath annually, report to the board of supervisors of their respective counties, during the first week of the annual session of such board, the tax rate of such city, village and school district for the year prior to the meeting of each such board. The said board of supervisors shall issue their warrant or order to the county treasurer on or before the fifteenth day of De- cember in each year, setting forth the number of shares of bank stock taxable in each town, city, village, school and other tax dis- trict in said county, in which said shares of stock shall be tax- able, the tax rate of each of said tax districts for said year, the proportion of the tax imposed by this act to which each of said tax districts is entitled, under the provisions hereof, 20 THH TAX LAW. and commanding him to collect same, and to pay to the proper officer in each of such districts the proportion of such tax to which it is entitled under the provisions of this act. The said county treasurer shall have the same powers to enforce the collection and payment of said tax as are pos- sessed by the officers now charged by law with the 'collection of taxes, and the said county treasurer shall be entitled to a commission of one per centum for collecting and paying out said monies,, which commission shall be deducted from the gross amount of said tax before the same is distributed. In issuing their warrants to the collectors of taxes, the board of supervisors shall omit therefrom assessments of and taxes upon the shares of stock of banks and banking associations. All assessments of the shares of stock of banks and banking associations made on or after January first, nineteen hun- dred and one, and prior to the passage of this act, shall be null and void, and new assessments thereof shall be made agreeably to the provisions of this act. Provided; that in the city of New York the statement of the bank assessment and tax herein provided for shall be made by the board of tax commissioners of said city, on or before the fifteenth day of December in each year, and by them forthwith mailed to the respective banks and banking associations located in said city, and a certified copy thereof sent to the receiver of taxes of said city. The tax shall be paid by the respective banks in said city to the said receiver of taxes on or before the thirty-first day of December in said year, and said tax shall be collected by the said receiver of taxes and shall be by him paid into the treasury of said city to the credit of the general fund thereof. This act is not to be construed as an exemp- tion of the real estate of banks or banking associations from taxation. (Thus amended by L. 1901, chap. 550, L. 1902, chap. 126 ; and L. 1903, chap. 267, taking effect April 24, 1903.) 25. Individual banker, how assessed. Every individual banker doing business under the* laws of this state, must report before the fifteenth day 6f June under oath to the assessors of the tax district in which any of the capital in- vested in such banking business is taxable, the amount of THE TAX LAW. 21 capital invested in such banking business in such tax dis- trict on the first day of June preceding. Such capital shall be assessed as personal property to the banker in whose name such business is carried on. 26. Notice of assessment to bank or banking association The assessors of every tax district shall within ten days after they have completed the assessment of the stock of a bank or banking association, give written notice to such bank or banking association of such assessment of the shares of its respective shareholders and no personal or other notice to such shareholders of such assessment is required. 27. Reports of corporations. The president or other proper officer of every moneyed or stock corporation deriv- ing an income or profit from its capital or otherwise shall, on or before June fifteenth, deliver to one of the assessors of the tax district in which the company is liable to be taxed and, if such tax district is in a county embracing a portion of the forest preserve, to the comptroller of the state, a writ- ten statement specifying: 1. The real property, if any, owned by such company, the tax district in which the same is situated and, unless a rail- road corporation, 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 prop- erty and the amount of such capital stock held by the state and by any incorporated literary or charitable institution, and 3. The tax district in which the principal office of the com- pany is situated or in case it has no principal office, the tax district in which its operations are carried on. Such statement shall be verified by the officer making the same to the effect that it is in all respects just and true. If such statement is not made within twenty days after the fif- teenth day of June, or is insufficient, evasive or defective, the assessors may compel the corporation to make a proper statement by mandamus. 28. Penalty for omission to make statement. In case of neglect to furnish such statements within thirty days after 22 THE TAX LAW. the time above provided, the company so neglecting shall forfeit to the people of this state for each statement so omitted to be furnished, the sum of two hundred and fifty dollars, and it shall be the duty of the attorney-general to prosecute for such penalty upon information which shall be furnished him by the comptroller. Upon such statement being furnished and the costs of the suit being paid, the comptroller, if he shall be satisfied that such omission was not willful, may, in his discretion, discontinue such suit. 28-a. County clerks to furnish data respecting corporations. Between the first and fifteenth days of June in tl^ year nineteen hun- dred and six, the county clerk in each county of the state, excepting counties containing a city of the second class and counties wholly situate within the corporate limits of a city, shall prepare from the records in his office and mail to each of the town clerks in his said county, a certi- fied statement containing the names of every stock corporation, incor- porated within the five years next preceding the first day of June, nine- teen hundred and six, whose principal business office or chief place of business is designated in its certificate of incorporation as being in such town or in any village or hamlet therein, together with the fact of such designation and the names and addresses of the directors of each such corporation so far as said county clerk can discover the same from the certificate of incorporation or from the latest certificate of election of directors of such corporation filed v in his office. Annually thereafter, between the first and fifteenth days of June, said county clerk shall fur- nish to such town clerks the several statements aforesaid containing the above facts with reference to stock corporations whose certificates of in- corporation have been filed with him since his last preceding annual statements to said several town clerks. Each town clerk receiving such statement shall forthwith file the same in his office and mail a notice of such filing to each of the assessors of his town. (Added by L. 1906, chap. 425,, taking effect May 11, 1906.) 29. Assessment of real property of nonresident. The real property of nonresidents of the tax districts shall be designated in a separate part of the assessment-roll and if it be a tract subdivided into lots or parts of a tract so subdivided, the assessors shall: 1. Designate it by its name, if known by one, or if not distinguished by a name or the name is unknown, state by what lands it is bounded. 2. Place in the first column the numbers of all unoccupied lots of any subdivided tract, without the names of the owner, beginning at the lowest number and proceeding in numerical order to the highest, but the entry of the name of the owner shall not affect the validity of the assess- ment. 3. In the second column and opposite the number of each lot, the quantity of land therein. 4. In the third column and opposite the quantity, the full value thereof. 5. If it be a part of a lot, the part must be distinguished by boundaries or in some other way by which it may be identified. If any such real property be a tract not subdivided or whose subdivisions can not be ascer- tained by the assessors, they shall certify in the roll that such tract is not subdivided, or that they can not obtain correct information of the subdivisions and shall set down in the proper column the quality and THE TAX LAW. 23 valuation as herein directed. If the quantity to be assessed is a part only of a tract, that part, or the part not liable, must be particularly described. 30. Surveys and maps of nonresident real property. If the assessors shall deem it necessary to have an actual survey made, to ascertain the- quantity of any lot or tract of nonresident real property divided by a town line, they shall notify the supervisor, who shall cause the necessary surveys to be made at the expense of the town. If a part only of a tract of real property is liable to taxation as nonresident and the assessors can not otherwise designate such part, they shall notify the supervisor of the town, who shall cause a survey and two manuscript maps to be made for the purpose of ascertaining the situation and quantity of such part. One of such maps shall be delivered to the county treasurer and by him to be transmitted to the comptroller in case the county in which the land is situated embraces a part of the forest preserve; and in other counties it shall be retained by him. The other map shall be delivered to the assessors, who shall then complete the assessment of the tract and deposit the map in the town clerk's office for the information of future assessors. The expense of making such survey shall be immediately repaid to the supervisor out of the county treasury and added by the board of supervisors to the tax on such tract, distinguishing it from the ordinary tax. 31. Corporations how assessed. The assessors shall as- sess corporations liable to taxation in their respective tax districts upon their assessment-rolls in the* following manner : 1. In the first column the name of each corporation, and under its name the amount of its capital stock paid in and secured to be paid in; the amount paid by it for real prop- erty then owned by it wherever situated ; the amount of all surplus profits or reserve funds exceeding ten per centum of their capital, after deducting therefrom the amount of said real property and the amount of its stock, if any, be- longing to the state and to incorporated literary and chari- table institutions. 2. In the second column the quantity of real property ex- cept special franchises owned by such corporation and situ- ated within their tax district. 3. In the third column the actual value of such real prop- erty, except special franchises. 4. In the fourth column the amount of the capital stock paid in and secured to be paid in, and of all such surplus 24 THE TAX LAW. profits or reserve funds as aforesaid, after deducting the sums paid out for all the real estate of the company, wherever the same may be situated, and then belonging to it, and the amount of stock, if any, belonging to the people of the state .and to incorporated literary and charitable institutions. 5. In the fifth column the value of any special franchise owned by it as fixed by the state board of tax commissioners. (Thus amended by L. 1899, chap. 712, taking effect October 1, 1899.) 32. Assessment of agent, trustee, guardian or executor If a person holds taxable property as agent, trustee, guard- ian, executor or administrator, he shall be assessed therefor as such, with the addition to his name of his representative character, and such assessment shall be carried out in a separate line from his individual assessment. 33. Assessment of omitted property. The assessors of any tax district shall, upon their own motion, or upon the application of any taxpayer therein, enter in the assessment- roll of the current year any property shown to have been omitted from the assessment-roll of the preceding year, at the valuation of that year, or if not then valued, at such valuation as the assessors shall determine for the preceding year, and such valuation shall be stated in a separate line from the valuation of the current year. 34. Debts owing to nonresidents of the United States, how assessed. Every agent in any county of a nonresident credi- tor having debts owing to him, taxable in any county of the state, shall annually, on or before June first, furnish to the county treasurer of the county where the debtor re- sides, a true and accurate statement verified by his oath, of such debts owing on the first day of May next pre- ceding in each town or ward in such county. The county treasurer shall, immediately upon the receipt of such statement, make out and transmit to the assess- ors of every tax district in the county in which any such debtor resides, a copy of so much of such statement as re- lates to the tax district of such assessors, with the name of THE TAX LAW. 25 the creditor. The assessors on receipt of such statement from the county treasurer shall, within the time in which they are required to complete the assessment-roll, enter therein the name of such nonresident creditor, and the aggre- gate amount due him in such tax district on the first day of May next preceding, in the same manner as other personal property is entered on the roll, adding the name of the debtor owing such debt. Any agent neglecting or refusing without good cause to furnish such statement to the county treasurer shall forfeit to the county in which the debtor resides the sum of five hundred dollars, recoverable by the district attorney, if the existence of such debts was known to the agent. 35. Notice of completion of assessment-roll. The as- sessors shall complete the assessment-roll on or before the first day of August, and make out one copy thereof, to be left with one of their number, and forthwith cause a notice to be conspicuously posted in three or more public places in the tax district, stating that they have completed the assessment- roll, and that a copy thereof has been left with one of their number at a specified place, where it may be seen and exam- ined by any person until the third Tuesday of August next following, and that on that day they will meet at a time and place specified in the notice to review their assessments. Upon application by a nonresident owner of real estate, hav- ing real estate in more than one tax district, the assessors may fix a time subsequent to the third Tuesday in August, but not later than the thirty-first day of August, for a hear- ing and to review their assessment. In any city the notice shall conform to the requirements of the law regulating the time, place and manner of revising assessments in such city. During the time specified in the notice the assessor with whom the roll is left shall submit to the inspection of every person applying for that purpose. (Amended by L. 1904, chap. 385, in effect April 26, 1904.) 36. Hearing of complaints. The assessors shall meet at the time and place specified in such notice, and hear and determine all complaints in relation to such assessments brought before them, and for that purpose they may adjourn from time to time. Such complainants shall file with the assessors a statement, under oath, specifying the respect in which the assessment complained of is incorrect, which veri- 26 THE TAX LAW. fication must be made by the person assessed or whose prop- erty is assessed, or by some person authorized to make such statement, and who has knowledge of the facts stated therein. The assessors may administer oaths, take testimony and hear proofs in regard to any such complaint and the assessment to which it relates. If not satisfied that such assessment is erroneous, they may require the person assessed, or his agent or representative, or any other person, to appear before them and be examined concerning such complaint, and to produce any papers relating to such assessment with respect to his property or his residence for the purpose of taxation. If any such person, or his agent or representative, shall will- fully neglect or refuse to attend and be so examined, or to answer any material question put to him, such person shall not be entitled to any reduction of his assessments. Minutes ' of the examination of every person examined by the assessors upon the hearing of any such complaint shall be taken and filed in the office of the town or city clerk. The assessors shall, after said examination, fix the value of the property of the complainant and for that purpose may increase or diminish the assessment thereof. 37. Correction and verification of tax-roll. When the assessors or a majority of them, shall have completed their roll, they shall severally appear before any officer of their county, authorized by law to administer oaths and shall severally make and subscribe before such officer an oath in the following form : " We, the undersigned, do severally depose and swear that we have set down in the foregoing assessment-roll all the real estate situated in the tax district in which we are assessors, according to our best informa- tion ; and that, with the exception of those cases in which the value of the said real estate has been changed by reason of proof produced before us, and with the exception of fehose cases in which the value of any special franchise has been fixed by the state board of tax commissioners, we have estimated the value of the said real estate at the sum which a majority of the assessors have decided to be the full value thereof; and, also, that the said assessment roll contains a true statement of the aggregate amount of the taxable per- sonal estate of each and every person named in such roll over and above the amount of debts due from such persons, respectively, and excluding such stocks as are otherwise tax- THE TAX LAW. 27 able, and such other property as is exempt by law from taxation, at the full value thereof, according to our best judgment and belief/' which oath shall be written or printed 011 said roll, signed by the assessors and certified by the officer, (Thus amended by L. 1899, chap. 712, taking effect October 1, 1899.) 38. Filing of roll and notice thereof. In cities the as- sessment roll when thus completed and verified shall be filed on or before September first, in the office of the city clerk, there to remain for fifteen days for public inspec- tion. The assessors shall forthwith cause a notice to be posted conspicuously in at least three public places in the tax district and to be published in one or more newspapers, if any, published in the city, that such assessment roll has been finally completed and stating that it has been so filed and will be open to public inspection. At the expiration of such fifteen days, the city clerk shall deliver such roll to a supervisor of the tax district embraced therein. In towns, when the assessment roll shall have been thus completed and verified, the assessors shall make two copies thereof, one of which shall be retained by them for the use of them- selves and their successors in office, and the other of which, duly certified by the said assessors to be a copy of said as- eessment roll, shall, on or before the fifteenth day of Sep- tember, be filed in the office of the town clerk, and which shall thereupon become a public record. The assessors shall forthwith cause a notice to be posted conspicuously in at least three public places in the tax district and to be pub- lished in one or more newspapers, if any, published in the town, that such assessment roll has been finally completed and stating that such certified copy has been so filed. The said original assessment roll shall on or before the first day of October be delivered to a supervisor of the tax district embraced therein. Notwithstanding the provisions of this section, the board of supervisors of any county may de- termine the number of copies of the town assessment rolls of the towns of such county to be made, by whom such copies shall be made, the date when the certified copy of the town assessment roll shall be filed in the office of the town clerk, and the date when the orginal assessment roll shall be delivered to the supervisor of the town. (Thus amended by L. 1901, chap. 358, and L. 1904, chap. 279, in effect April 13, 1904.) 28 THE TAX LAW. 39. Assessors to apportion valuation of railroad, tele- graph, telephone, cr pipe line companies between school dis- tricts. The assessors of each town in which a railroad, tele- graph, telephone or pipe line company is assessed upon property lying in more than one school district therein, shall, within fifteen days after the final completion of the roll, apportion the assessed valuation of the prop- erty of each of such corporations among such school districts. Such ap- portionment shall be signed by the assessors or a majority of them, and be filed with the town clerk within five days thereafter, and thereupon the valuation so fixed shall become the valuation of such property in such school district for the purpose of taxation. In case of failure of the assessors to act, the supervisor of the town shall make such appor- tionment on request of either the trustees of any school district or of the corporation assessed. The town clerk shall furnish the trustees a certified statement of the valuations apportioned to their respective dis- tricts. In case of any alteration in any school district affecting the valu- ation of such property, the officer making the same shall fix and deter- mine the valuations in the districts affected for the current year. 40. Neglect or omission of duty by assessors. The as- sessors, in the execution of their duties, shall use the forms. and follow the instructions transmitted to them, from time to time, by the commissioners of taxes. If any assessor shall neglect or omit to perform any duty, the other as- sessors shall perform such duty and shall certify upon the assessment-roll the name of the delinquent assessor, stating therein the cause of such omission, and the assessment-roll, when otherwise made and completed in accordance with the requirements of this article, shall be deemed to be the as- sessment-roll of all the assessors. If the assessors shall neglect to meet for the purpose of hearing grievances any person aggrieved by the assessment may appeal to the board of supervisors at its next meeting, which shall have the same power to review and correct such assessment as the assessors have under this article. If any assessors shall refuse or neglect to perform any duty or do any act re- quired of him by this article, he shall forfeit to the county the sum of fifty dollars, to be recovered by the district attorney. 41. Abandonment of lot divisions. Whenever more than ten, years shall have elapsed after the subdivision of nnv tract of land into lots, plots or sites, with or without proposed streets, the owner of such tract, or of any part THE TAX LAW. 29 thereof composed of two or more contiguous lots may, by an instrument in writing, duly executed and acknowledged and describing such land, disclaim and abandon such subdivision including any streets not opened, accepted or used by the public, and which are not necessary for the use of an owner or occupant of any part of said tract; and thereupon such subdivision, as to the lands described in such instrument, shall be deemed abandoned and of no effect; and thereafter the lands described therein shall, for the purpose of tax- ation, be regarded as a single tract. If a map of such sub- division has been filed in the office of the county clerk or register of deeds, such instrument may be recorded in said office, and a notice of such record shall thereupon be in- dorsed by the clerk or register upon such map. This sec- tion shall not apply to a county embracing a portion of the forest preserve. 42. Assessment of special franchises. The state board of tax commissioners shall annually fix and determine the valuation of each special franchise subject to assessment in each city, town, or tax district. After the time fixed for hearing complaints the tax commissioners shall finally deter- mine the valuation of the special franchises, and shall file with the clerk of the city or town in which said special franchise is assessed a written statement duly certified by the secre- tary of the board of the valuation of each special franchise assessed therein as finally fixed and determined by said board; such statement of valuation shall be filed with the town clerk of the respective towns within thirty days next preceding the first day of July in each year; and with the clerks of cities of the state within thirty days before the date set opposite the name of each city in the following sched- ule. In the city of ISTew York such statement shall be filed with the department of taxes and assessments. SCHEDULE OF DATES FOR FILING OF ASSESSMENTS OP SPECIAL FRANCHISES. Name of City. Date. Name of City. Date. Rochester, April 1st. Auburn, May 1st. Jamestown, April 1st. Schenectady, June 1st. Ithaca, April 1st. Corning, June 1st. Glovorsville, April 1st. Hornellsville, June 1st. Xow York city, April 1st. Oswcgo, J-ine 1st. 30 THE TAX LAW. Name of City. Date. Name of City. Date. North Tonawanda, July 1st. Hudson, July 1st. Olean, July 1st. Amsterdam, July 1st. Syracuse, July 1st. Binghamton, July 1st. Cohoes, July 1st. Geneva, July 1st. Ogdensburg, July 1st. Middletown, July 1st. Dunkirk, July 1st. Johnstown, July 1st. Troy, July 1st. Fulton, July 1st. Rome, July 1st. Plattsburgh, July 1st. Watertown, July 1st. Tonawanda, July 1st. Elmira, July 1st, Rensselaer, July 1st. Lockport, July 1st. Oneida, July 1st. Utica, July 1st. Cortland, July 1st. Poughkeepsie, July 1st. Yonkers, October 1st. Little Falls, July 1st. New Rochelle, October 1st. Watervliet, July 1st. Albany, October 1st, Niagara Falls, July 1st. Mount Vernon, October 1st. Kingston, July 1st. Buffalo, December 1st. Newburgh, July 1st. Each city or town clerk shall, within five days after the receipt by him of the statement of assessment of a special franchise by the state board, deliver a copy of such state- ment certified by him to the assessors or other officers charged with the .duty of making local assessments in each tax district in said city or town and to the assessors of villages and commissioners of highways within their re- spective towns and villages. The valuations of every special franchise as so fixed by the state board shall be entered by the assessors or other officers in the proper column of the assessment-roll before the final revision and certification of such roll by them, and become part thereof with the same force and effect as if such assessment had been originally made by such assessor or other officer. If a special fran- chise assessed in a town is wholly within a village, the valu- ation fixed by the state board for the town shall also be the valuation for the village. If a part only of such special fran- chise is in a village, or is in a village situated in more than one tax district, it shall be the duty of the village assessors to ascertain and determine what portion of the valuation of such franchise, as the same has been fix*ed by the state board, shall be placed upon the tax roll for village purposes. The valuation apportioned to the town shall be the assessed valuation for highway purposes, and in case part of such special franchise shall be assessed in a village and part thereof in a town outside a village, the commissioners of THE TAX LAW. 31 highways of the town and village shall meet on the third Tuesday in August in each year and apportion the valuation of such special franchises between such town outside the village and such village for highway purposes. In case of disagreement between them the decision of the supervisor of the town shall be final. The town assessors shall make an apportionment among school districts at the time and in the manner required by section thirty-nine of this chapter. The valuation so fixed by the state board shall be the assessed valuation on which all taxes based on such special franchise in the city, town or village for state, municipal, school or highway purposes shall be levied during the next ensuing year. It shall not be necessary for the state board of tax commissioners to give notice to any person, copartnership, association or corporation of the valuation of a special fran- chise located in any village for village purposes except in a case where such valuation is required to be made for such village purposes by the state board of tax commissioners. The assessors or other taxing officer, or other local officer in any city, town or village, or any state or county officer, shall on demand furnish to the state board of tax commis- sioners any information required by such board for the purpose of determining the value of a special franchise. (Added by L. 1899, chap. 712, and amended by L. 1900, chap. 254 ; L. 1902, chap. 112, and L. 1904, chap. 382, 2, in effect April 26, 1904.) L. 1904, ch. 382. 2. This act shall not relate to the assessment of special franchises in the city of Buffalo made or to be made by the state board of tax commissioners in the year nineteen hun- dred and four for the purpose of raising the annual taxes of said city of Buffalo for the fiscal year beginning July first, nineteen hundred and four. 3. Except as provided in section two hereof, this act shall take effect immediately. 43. Report to state board of tax commissioners. Every person, copartnership, association or corporation sub- ject to taxation on a special franchise, shall, within thirty days after this section takes effect, or within thirty days after such special franchise is acquired, make a written report to the state board of tax commissioners containing a full de- scription of every special franchise possessed or enjoyed by such person, copartnership, association or corporation, a copy of the special law, grant, ordinance, or contract under which the same is held, or if possessed or enjoyed under a general law, a reference to such law, a statement of any condition, 32 THE TAX LAW. obligation or burden imposed upon such special franchise, or under which the same is enjoyed, together with any other information relating to the value of such special franchise, required by the state board. The state board of tax commissioners may from time to time require a fur- ther or supplemental report from any such person, copartnership, asso- ciation or corporation, containing information and data upon such matters as it may specify. Every report required by this section shall have annexed thereto the affidavit of the president, vice-president, secre- tary or treasurer of the association or corporation, or one of the per- sons or one of the members of the copartnership making the same, to the effect that the statements contained therein are true. Such board may prepare blanks to be used in making the reports required by this section. Every person, copartnership, association or corporation failing to make the report required by this section, or failing to make any special report required by the state board of tax commissioners within a reasonable time specified by it, shall forfeit to the people of the state the sum of one hundred dollars for every such failure and the additional sum of ten dollars for each day that such failure continues, and shall not be entitled to review the assessment by certiorari, as provided by section forty-five of this chapter. (Added by L. 1899, chap. 712, taking effect October I, 1899.) 44. Hearing on special franchise assessment. On making an assessment of a special franchise, the state board of tax com- missioners shall immediately give notice in writing to the person, copartnership, association or corporation affected, -and to each city or town in which such special franchise is subject to assess- ment, stating in substance that such assessment has been made, the total valuation of such special franchise, and the valuation thereof in each city, town or tax district; and that the board will meet at its office in the city of Albany on a day specified in such notice, which must not be less than twenty nor more than thirty days from the date of the notice, to hear and determine any complaint concerning such assessment. But no notice need be given any such town unless the supervisor thereof shall at least fifteen days prior to the time fixed for such hearing fib with said board a request in writing for notice thereof. Such notice must be served at least ten days before the day fixed for the hearing; and it may be served on a copartnership, asso- ciation or corporation, by mailing a copy thereof to it at its principal office or place of business and on a person, either per- sonally or by mailing it to him at his place of business or last known place of residence; and on a city or town by mailing it to the mayor of such citv or the supervisor of such town at the address specified in such request. A city or town entitled to notice under this section, shnll have the right to be heard and to file affidavits and other proofs in respect to the valuation of such special franchise. Section thirty-six of this chapter applies so far as practicable to a hearing by the state board of tax com- missioners under this section. (Added by L. 1890, cliap. 712, taking effect October 1. 1899. and amended by L. 1906, cliap. 458, taking effect Hfmi 15, 1906.) 45. Certiorari to review assessment. An assessment of a special franchise by the state board of tax commissioners may be THE TAX LAW. 33 reviewed in the manner prescribed by article eleven of this chap- ter, and that article applies so far as practicable to such an assessment, in the same manner and with the same force and effect as if the assessment had been made by local assessors; a petition for a writ of certiorari to review the assessment must be presented within fifteen days after the completion and filing of the assessment-roll, and the first posting or publication of the notice thereof as required by law. Such writ must run to and be answered by said state board of tax commissioners and no writ of certiorari to renew any assessment of a special franchise shall run to any other board or officer unless otherwise directed by thfl court or a judge granting the writ. An adjudication made in the proceeding instituted by such writ of certiorari shall be binding upon the local assessors and any ministerial officer who performs any duty in the collection of said assessment in the same manner as though said local assessors or officers had been parties to the proceeding. The state board of tax commissioners on filing with the city, town or village clerk a statement of the valuation of a special franchise, shall give to the person, co- partnership, association or corporation affected written notice that such statement has been filed, and such notice may be served on a copartnership, association or corporation by mailing a copy thereof to it at its principal office or place of business, and on a person Cither personally or by mailing it to him at his place of business or last known place of residence. (Added by L. 1899, chap. 712, taking effect October 1, 189T/, and amended by L. 1900, chap. 254, taking effect March 29, 1900.) 45a. Id; appearance by state board by special counsel; payment of his costs, expenses and disbursements. In any proceeding for the review of an assessment of a special fran- chise made by the state board of tax commissioners, said state board of tax commissioners is authorized to appear by counsel to be designated by the attorney-general. The compensation of such counsel and the necessary and proper expenses and dis- bursements, including the expense of procuring the evidence of experts, incurred or made by him in the defense of such pro- ceeding, and upon any appeals therein, shall when audited and allowed as are other charges against such tax district, be a chargo upon the tax district upon whose rolls appears the assessment sought to be reviewed. Where, in one proceeding, there is re- viewed the assessment of a special franchise in more than one tax district, separate accounts shall be rendered for said costs, expenses and disbursements to the proper officer of each of said tax districts and audited and allowed by him as aforesaid. For the purposes of this section, the city of New York shall be doomed one tax district. (Added by L. 1906, chap. 155, in effect April 6, 1906.) 46. Deduction from special franchise tax for local pur- poses. If, when the tax assessed on any special franchise is 34 THE TAX LAV/. due and payable under the provisions of law applicable to the city, town or village in which the tangible property is located, it shall appear that the person, copartnership, asso- ciation or corporation affected has paid to such city, town or village for its exclusive use within the next preceding year, under any agreement therefor, or under any statute re- quiring the same, any sum based upon a percentage of gross earnings, or any other income, or any license fee, or any sum of money on account of such special franchise, granted to or possessed by such person, copartnership, association, or corporation, which payment was in the nature of a tax, all amounts so paid for the exclusive use of such city, town, or village except money paid or expended for paving or repairing of pavement of any street, highway or public place, shall be deducted from any tax based on the assessment made by the state board of tax commissioners for city, town or village purposes, but not otherwise; and the remainder shall be the tax on such special franchise payable for city, town or village purposes. The chamberlain or treasurer of a city, the treasurer of a village, the supervisor of a town, or other officer to whom any sum is paid for which a person, copartnership, association, or corporation is entitled to credit as provided in this section, shall, not less than five nor more than twenty days before a tax on a special franchise is pay- able, make and deliver to the collector or receiver of taxes or other officer authorized to receive taxes for such city, town or village, his certificate showing the several amounts which have been paid during the year ending on the day of the date of the certificate. On the receipt of such certifi- cate the collector, receiver or other officer shall immediately credit on the tax roll to the person, copartnership, associa- tion or corporation affected the amount stated in such cer- tificate, on any tax levied against such person, copartnership, association or corporation on an assessment of a special fran- chise for city, town or village purposes only, but no credit shall be given on account of such payment or certificate in any other year, nor for a greater sum than the amount of the special franchise tax for city, town or village purposes, for the current year; and he shall collect and receive the bal- ance, if any, of such tax as required by law. (Added by L. 1899, chap. 712, taking effect October 1, 1899.) THE TAX LAW. 35 47. Special franchise tax not to affect other tax. The im- position or payment of a special franchise tax as provided in this chapter shall not relieve any association, copartner- ship or corporation from the payment of any organization tax or franchise tax or any other tax otherwise imposed by article nine of this chapter, or by any other provision of law; but tangible property subject to a special franchise tax situ- ated in, upon, under or above any street, highway, public place or public waters, as described in subdivision three of section two shall not be taxable except upon the assessment made as herein provided by the state board of tax commis- sioners. (Added ~by L. 1899, chap. 712, taking effect Octo- ler 1, 1899.) 36 THE TAX LAW. AETICLE III. EQUALIZATION OF ASSESSMENT AND LEVY OF TAX. Section 50. Equalization by board of supervisors. 51. Description of real property of nonresidents. 52. Review of assessments against nonresident owners of rents reserved. 53. Correction of errors by board of supervisors. 54. Reassessment of property illegally assessed. 55. Levy of tax by supervisors. 56. Tax-roll and collector's warrant. 57. Statement of taxes upon certain corporations by clerk of supervisors. 58. Statement of valuation to be furnished to comptroller. 59. Abstract of warrant to be furnished county treasurer. 60. Certain errors in roll to be corrected. 50. Subd. 1. Equalization by board of supervisors. The board of supervisors of each county in this state, at its annual meeting, shall examine the assessment-roils of the several tax districts in the county, for the purpose of ascertaining whether the valuations in one tax district bear a just relation to the valuations in all the tax districts in the county; and the board may increase or diminish the aggregate valua- tions of real estate in any tax district, by adding or deducting such sum upon the hundred, as may, in its opinion, be necessary to produce a just relation between all the valuations of real estate in the county; but it shall, in no instance, except as provided in subdivision two of this section, change the aggregate valuations of all the tax districts from the aggregate valuation thereof as made by the assessors. Subd. 2. The board of supervisors in any county of the state having a population of more than fifty-five thousand and less than sixty thou- sand inhabitants according to the federal enumeration next preceding the passage of this act and which adjoins a city of the first class may, in its discretion, when examining the assessment rolls of the several tax districts of the county, as above provided, exclude from the tax rolls of said districts, to be prepared by said board, such parcels of real property as have been struck down to the county at a tax sale and not redeemed as provided in section one hundred and fifty-two of this act : No such properties shall be so excluded from said tax rolls except by a resolution of said board adopted at an annual meeting by a vote of a majority of the members thereof. Whenever such real property is so excluded from the tax rolls by the board the total of the assessed valua- tions of the real estate of the several tax districts, as the same appear on the completed tax rolls, shall be the aggregate valuation of the tax- able real estate in the county. (Thus amended by L. 1905, chap. 447.) Commissioners for equalization of taxes, see L. 1896, chap. 820. 51. Description of real property of nonresidents. The board of supervisors of each county, at its annual meeting, shall examine the assessment-rolls of the several tax districts, and shall make such changes in the descriptions of the real property of nonresidents as may be necessary to render such descriptions sufficiently definite for the purposes of collection of taxes by sale thereof. If a sufficiently definite description can not be obtained during the session, the board shall cause the same to be obtained for the next annual THE TAX LAW. 37 session, and the property shall not be taxed until such de- scription is obtained, and shall then be taxed for the year so omitted, in the manner provided for taxing omitted lands. 52. Review of assessment against nonresident owners of rents reserved. If an assessment of taxable rents shall have been made against any person in any tax district of which he is not an actual resident, the board of supervisors of the county shall have the same power and authority in all re- spects, and it shall be its duty to correct such assessments as to the valuation of such rents and as to the gross amount for which such persons shall be assessed therefor, as the as- sessors of a tax district have as to the assessment of personal property of an actual resident of such tax district. The board may reduce the amount of any such assessment, if necessary, to make such assessment just when compared with the other assessments of property upon such roll. 53. Correction of errors by board of supervisors If it shall be made to appear to the board of supervisors of any county, upon the verified petition of the assessors of any tax district: First. That any property taxable therein has, by any mis- take in transcribing or copying the assessment-roll of the preceding year, been placed on the assessment-roll delivered to the supervisor, at a valuation less than actually appear- ing upon the original roll signed by the assessors, such board shall insert in the assessment-roll of the current year an assessment of the property upon the valuation equal to the difference between the actual valuation made by the as- sessors and the amount at which, by such mistake, the prop- erty was placed upon the roll of the preceding year, and tax the same at the rate per centum imposed upon property in such tax district in the year in which the mistake occurred. Second. That any taxable property therein has been omitted from the assessment-roll of the preceding year, such board shall place the same on the roll of the current year at its valuation for the preceding year, to be fixed by the as- sessors in their petition, and shall tax the same at the rate per centum of the preceding year. 38 THE TAX LAW. Third. That taxable property has been omitted from the assessment-roll, for the current year, such board shall place the same thereon at a valuation to be fixed by the assessors in their petition, and shall tax the same at the rate per centum of the current year. A copy of the petition under the second or third subdi- vision of this section, with a notice of the presentation thereof to the board of supervisors, shall be served person- ally on the person alleged to be liable to taxation for the land omitted from the assessment-roll, at least ten days be- fore the meeting of the board of supervisors ; and the board of supervisors shall take no action on such petition, unless proof of the personal service of such petition and notice be made to them by affidavit. The board of supervisors shall give to the person alleged to be liable to taxation for such omitted land, an opportunity to be heard, and on such hear- ing and review the board of supervisors shall have, as to such omitted property all the powers of the assessors of a tax district in reviewing and correcting the assessment-roll. The whole amount of tax levied upon land or property omitted in the tax levy of the preceding year shall be de- ducted from the aggregate of taxation to be levied on the tax district for the current year before such tax is levied. 54. Reassessment of property illegally assessed. When- ever by the final judgment of a court of competent jurisdic- tion, it appears to the board of supervisors that any property liable to taxation in any year was erroneously or illegally assessed, and that by reason of such erroneous or illegal as- sessment, such property did not become subject to taxation for such year, the board shall place the same on the roll of the current year at the valuation thereof, if any, fixed by the assessors for such preceding year ; and in case no valus- tion was fixed by the assessors, such property shall be as- sessed by the board at such valuation as they may determine for the preceding year. Before fixing such valuation, the board of supervisors shall give to the owners of such prop- erty, at the time of the assessment by the board, a notice of at least five days and an opportunity to be heard, and on such hearing, the board shall have, as to such property, all THE TAX LAW. 39 the powers of the assessors of a tax district in reviewing and correcting an assessment-roll. Such property shall be taxed at the rate per centum of such preceding year. The whole amount of tax on property levied in pursuance of this section shall be deducted from the aggregate of taxation to be levied on the tax district for the current year, before such tax is levied. 55. Levy of tax by supervisors. The board of supervis- ors of each county shall, at its annual meeting, levy the taxes 'for the county, including the state tax, upon the valu- ations as equalized by it and estimate and set down in a separate column in the assessment-roll of each tax district therein, opposite to the sums set down as the valuation of real and personal property or property of incorporated com- panies or of the taxable rents reserved, the sum to be paid as a tax thereon, including the state tax, as fixed by the comptroller. Such assessment-roll shall, when the warrant is annexed thereto, become the tax-roll of the tax district, and a copy thereof shall be delivered to the proper super- visor, who shall deliver it to the clerk of the proper city or town to be kept by him for its use. 56. Tax-roll and collector's warrant. On or before De- cember fifteenth in each year the board of supervisors shall annex to the tax-roll a warrant under the seal of the county, signed by the chairman and clerk of the board, command- ing the collector of each tax district, to whom the same is directed to collect from the several persons named in said roll the several sums mentioned in the last column thereof, opposite their respective names, except taxes upon the shares of sitock of banks and banking associations, on or before the first day of the following February, and further com- manding him to pay over on or before that date all mon- eys so collected appearing 011 said roll, to the treasurer of the county, if he be a collector of a city or a division thereof, or if he be a collector of a town : 1. To the commissioners of highways of the town, such sum as shall have been raised for the support of highways and bridges therein. 40 THE TAX LAW. 2. To the overseers of the poor of the town, such sum as shall have been levied, to be expended by such overseers for the support of the poor therein. 3. To the supervisor of the town, all the moneys levied therein, to defray any other town expenses or charges. 4. To the treasurer of the county, the residue of the money so to be collected. If the law shall direct the taxes levied for any local or special purpose in a city or town, to be paid to any person or officer other than those named in this section, the war- rant shall be varied so as to conform to such direction. The warrant shall authorize the collector to levy such taxes by distress and sale, in case of nonpayment. The corrected assessment-roll, or a fair copy thereof, shall be delivered by the board of supervisors to the collector of the tax district on or before December fifteenth, in each year. (Thus amended by L. 1901, chap. 158, taking effect March 22, 1901, and L. 1901, chap. 550, taking effect April 25, 1901.) 57. Statement of taxes upon certain corporations by clerk of supervisors. The clerk of each board of supervisors shall, within five days after the tax warrant is completed, deliver to the county treasurer, a statement showing the names, valuation of property and the amount of tax of every railroad corporation and telegraph, telephone and electric-light line in each tax district in the county, and on refusal or neglect so to do, shall forfeit to the county the sum of one hundred dollars, to be sued for by the district attorney in the name of the county. 58. Statement of valuation to be forwarded to comp- troller. The clerk of each board of supervisors shall, on or before the second Monday in December, transmit to the comptroller, in the form to be prescribed by such comp- troller, a certificate or return of the aggregate assessed and equalized valuation of the real and personal estate in each tax district as the valuation of such real estate has been cor- rected by such board, and the amount of tax assessed thereon for town, city, school, county and state purposes. Also the names of the several incorporated companies liable to taxa- THE TAX LAW. 41 tion in such county, the nature of their business, the amount of the capital stock paid in and secured to be paid in by each, the amount of real and personal property of each as put down by the assessors, or by it, the amount of taxes assessed on each, and the amount of personal property on which each such corporation is exempt on account of the payment of state taxes on its capital. In the city of J$ew York such report shall be made by the clerk of the board of aldermen, and for the purpose of making such report he may require any department or board of such city to furnish the neces- sary information. 59. Abstract of warrant to be furnished county treasurer. On or before the twentieth day of December in each year, the clerk of the board of supervisors shall transmit to the treasurer of the county an abstract of the tax-rolls, stating the "names of the collectors, the amount of money which each is to collect, the purpose for which it is to be collected, and the persons to whom and the time when it is to be paid. The county treasurer, on receiving such account, shall charge to each collector the amount to be collected by him. 60. Certain errors in roll to be corrected. The assess- ment of a non-resident parcel of real estate in the resident portion of the roll, the assessment of a resident parcel of real estate in the non-resident portion of the roll, an error in the name of the owner or occupant or the assessment of a parcel of real estate to the name of a deceased person or to his estate, shall not render the assessment invalid or render the tax levied on the valuation of said real estate invalid. The board of supervisors of each county may at any time before levying the tax as provided in article* three of this act, at the request of the supervisor of the tax district in which the real estate is situated, correct any errors which may come to his knowledge in the assessment of any parcel of real estate in his district, in either of the cases mentioned in this section. (Added by L. 1902, chap. 171, in effect April 4, 1902.) 42 THE TAX LAW. RETICLE IT. COLLECTION OF TAXES. Section 70. Notice by collector. 7 Oa. Notice to nonresidents. 71. Collection of taxes. 72. Collection of taxes assessed against stocks in banks and banking associations. 73. Payment of taxes by railroad and certain other corpora- tions. 74. Enforcement of tax against telegraph, telephone and elec- tric-light lines. 75. Collection of taxes on rents reserved. 76. Collection of unpaid taxes on debts owing to nonresidents of the United States. 77. Return of warrant for collection of taxes on debts owing to nonresidents; neglect to make return. 78. Remedy of tenant for taxes on part of lot. 79. Payment of taxes on part of lot. 80. Payment of taxes on state lands in forest preserve. 81. Fees of collector. 82. Return by collector of unpaid taxes. 83. Return when collection has been enjoined. 84. Payment of moneys collected. 85. Extension of time for collection. 86. Appointment of collector in case of vacancy. 87. When sheriff shall execute collector's warrant. 88. Satisfaction of collector's bond. 89. Unpaid tax on resident real property to be reassessed. 90. Payment to creditors of the county. 91. Payment of state tax. 92. Accounts of county treasurer with comptroller. 93. Losses by default of collector or treasurer. 94. Receipts for taxes. 95. Article, how applicable. 70. Notice by collector Every collector, upon receiv- ing a tax roll and warrant, shall forthwith cause notice of the reception thereof to be posted in five conspicuous places in the tax district, specifying one or more convenient places in such tax district, where he will attend from nine o'clock in the forenoon until four o'clock in the afternoon, at least three days, and if in a city, at least five days, in each week for thirty days from the date of the notice, which shall be the date of the posting or first publication thereof, which days shall be specified in such notice, for the purpose of re- ceiving the taxes assessed upon such roll. The collector THK TAX LAW. 43 shall attend accordingly, and any person may pay hit taxes to such col- lector at the time and place so designated, or at any other time or place. In a city, the notice in addition to being posted shall be pub- lished once in each week, for two weeks successively, in a newspaper published in such city. On the written demand of a non-resident owner of real property included in such tax roll, and the payment by such owner to the collector of the sum of twenty-five cents, the col- lector shall within twenty-four hours after the receipt of such de- mand mail in a postpaid envelope directed to such non-resident owner, to the orders to be furnished in such demand, a statement of the amount of taxes assessed against such property with a notice of the dates and places fixed by him for receiving taxes. (Thus amended by L. 1899, chap. 342, taking effect April 17, 1899.) I 70*. Notice to non-residents. A person who is the owner of, or liable to assessment for, an interest in real property situated and liable to assessment and taxation in a tovvn in which he is not actually a resident may file with the town clerk of cuch town a notice stating his name, residence and post-office address, a description of the prem- ises sufficient to identify the same, and if situated in a village or school district, the name of such village and number and designation of such school district. The town clerk shall, within five days after the deliv- ery of the warrants for the_ collection of taxes in such tax districts, furnish to the collectors of the town, and the collector of each village and school district in which such real property is situated, and such collectors shall within such time apply for, a transcript of all notices so filed, and such collectors shall within five days after the receipt of such transcript mail to each person filing such notice, at the post- office address stated therein, a statement of the amount of taxes due on said property. Upon the filing of such notice the town clerk shall be entitled to receive a fee of one dollar from the person offering such notice, which shall be in full for all services rendered hereunder. (In- serted by L, 1903, chap. 338.) 71. Collection of taxes. After the expiration of such period of thirty days, the collector shall call, at least once, on every person taxed upon such .roll, whose taxes are unpaid, at his usual place of residence, if he is an actual inhabitant of such tax district, and demand payment of the taxes charged to him on his property. If any person shall neg- lect or refuse to pay any tax imposed on him, the collector shall levy upon any personal property in the county belonging to or in the posses- sion of any person who ought to pay the tax, and cause the same to be sold at public auction for the payment of such tax, and the fees and expenses of collection; and no claim of property to be made thereto by any other person shall be available to prevent such sale. Public notice of the time and place of sale of the property to be sold shall be given by posting the same in at least three public placeo in the tax district where the sale is to be made, at least six days previous thereto. If the proceeds of such sale shall be more than the amount of such tax, the fees of the collection and the expenses of the sale, the surplus shall be paid to the person against whom the tax was assessed. If any other per- son shall claim the surplus, on the ground that the property sold belonged to him, and such claim be admitted by the person for the payment of whose tax the sale was made, such surplus shall be paid to such other per- 44: THE TAX LAW. son. If such claim be contested by the person for the pay- ment of whose tax the property was sold, such surplus shall be paid over by the collector to the supervisor of the town, who shall retain the same until the rights of the parties thereto shall be determined by due course of law, or by agreement in writing made by them and filed with the su- pervisor. The collector upon payment of the taxes shall state in the column of the tax roll provided therefor, the date of such payment, and shall write his name after such dato. (Thus amended by L. 1901, chap. 159, taking effect March 22, 1901.) 72- Collection of taxes assessed against stocks in banks and banking associations Every bank or banking associa- tion shall retain any dividend until the delivery to the col- lector of the tax-roll and warrant of the current year, and within ten days after such delivery, shall pay to such col- lector so much of such dividend as may be necessary to pay any unpaid taxes assessed on the stock upon which such divi- dend is declared. In case the owner of such stock resides in a place other than where the bank or banking association is located, the same power may be exercised in collecting the tax so assessed as is given in case a person has removed from a tax district in which the assessment was made. The tax so assessed shall be and remain a lien on the shares of stock against which it is assessed till the payment of such tax, and if the stock is transferred it shall be subject to such lien. The collector or county treasurer may foreclose such lien in any court of record, and collect from the avails of the sale of the stock the tax assessed against the same. In addition thereto, the same remedy may be had for the col- lection of the tax on such shares as is now provided by law for enforcing payment of personal tax against residents. 73. Payment of taxes by railroad and certain other cor- porations. Any railroad, telegraph, telephone or electric- light company may, within thirty days after receipt of no- tice by the county treasurer from the clerk of the board of supervisors, pay its tax, with one per centum fees, to the county treasurer, who shall credit the same with such fees THE TAX LAW. 45 to the collector of the tax district, unless otherwise required by law. If not so paid the county treasurer shall notify the collector of the tax district where it is due, and he shall then proceed to collect under his warrant. Until such notice from the treasurer the collector shall not enforce payment of such taxes, but may receive the same, with the fees al- lowed by law, at any time. 74. Enforcement of tax against telegraph, telephone and electric-light lines. Collection of tax against a telegraph, telephone or electric-light line may be enforced by sale of the instruments and batteries connected with such line, and in case there is not sufficient personal property, together with such instruments and batteries, to pay such tax and the percentage due the collector, he shall return a statement thereof to the county treasurer as other unpaid taxes are returned, and the county treasurer shall proceed to sell such part of the line in the tax district where the tax was levied as may be necessary to satisfy the unpaid taxes and per- centage, in the manner now provided by law for the sale of lands on execution, and upon such sale shall execute to the purchaser a conveyance of such part of said line, and the purchaser shall thereupon become the owner thereof. Noth- ing herein contained shall be construed to prevent collection of such taxes by any procedure now provided by law. 75. Collection of taxes on rents reserved. If any tax upon any such tax-roll upon rents reserved is not paid, the collector shall collect the same by levy and sale of the per- sonal property of the persons against whom the tax is levied, which may be found within the county. If no sufficient personal property belonging to such person can be found in the county, the collector shall collect such tax of the tenant or lessee in possession of the premises, on which the rent is reserved, in the same manner as if such tax had been as- sessed against such tenant or lessee. Every such tenant or lessee paying any such tax, or of whom any such tax shall be collected, shall be entitled to have the amount thereof, with interest, deducted from the amount of rent reserved upon such premises, which may be due or may thereafter become due thereon, or may maintain an action to recover the same. 46 THE TAX LAW. 76. Collection of unpaid taxes on debts owing to nonresi- dents of the United States. If it shall appear by the re- turn of any collector that any tax imposed upon a debt owing to a person residing out of the United States remains unpaid, the county treasurer shall, after the expiration of twenty days from such return, issue his warrant to the sher- iff of any county in this state where any debtor of any such nonresident creditor may reside, commanding him to make of the real and personal property of such nonresident the amount of such tax, to be specified in a schedule annexed to the warrant, with his fees and the sum of one dollar for the expense of issuing such warrant, and to return the war- rant to the treasurer issuing the same, and to pay over to him the money which shall be collected by virtue thereof, except the sheriff's fees, by a day therein to be specified within sixty days from the date thereof. The taxes upon several debts owing to a nonresident shall be included in one warrant. The taxes upon several debts owing to differ- ent nonresidents may be included in the same warrant, and the sheriff shall be directed to levy the sum specified in the schedule annexed, upon the real and personal property of the nonresidents, respectively, opposite to whose names, re- spectively, such sums shall be written, with fifty cents for the expenses of the warrant. Such warrant shall be a lien upon and shall bind the real and personal property of the nonresidents against whom issued from the time an actual levy shall be made upon any property by virtue thereof, and the sheriff to whom the warrant shall be directed shall proceed upon the same, in all respects, with like effect, and in the same manner, as prescribed by law, in respect to exe- cution against property issued upon judgment rendered in the supreme court, and shall be entitled to the same fees for his services in executing the same, to be collected in the same manner. 77. Return of warrant for collection of taxes on debts owing to nonresidents ; neglect to make return. If any sher- iff shall neglect to return any such warrant as directed therein, or to pay over any money collected by him in pur- suance thereof, he shall be proceeded against in the supreme THE TAX LAW. 47 court by attachment in the same manner, and with like ef- fect, as for similar neglect in reference to an execution is- sued out of the supreme court in a similar action, and the proceedings therein shall be the same in all respects. If my such warrant shall be returned unsatisfied, wholly or partly, the county treasurer may obtain an order from a judge of the supreme court of the district, or a county judge of the county, of such treasurer, issuing the warrant, re- quiring sucli nonresident or any person having property of such nonresident or indebted to him, to appear and answer concerning the property of such nonresident. The same remedies and proceedings may be had in the name of such county treasurer or comptroller before the officer granting such order, and with a like effect, as are provided by law in proceedings against a judgment debtor supplementary to execution against him, returned wholly or in part unsatis- fied. The expenses of a county treasurer, and such com- pensation as the board of supervisors may allow him for his services under this section, and for making and trans- mitting to the assessors of the several towns of his' county an abstract or copy of the statements of the agents of non- resident creditors, shall be a county charge. 78. Remedy of tenant for taxes paid by him. If a tax upon real property shall have been collected of any occupant or tenant, and any other person, by agreement or otherwise, ought to pay such tax, or any part thereof, such occupant or tenant shall be entitled to recover, by action, the amount which such person ought to have paid ; or to retain the same from any rent due or accruing from him to such person for the land so taxed. 79. Payment of taxes on part of lot The collector shall receive the tax on part of any lot, piece or parcel of land charged with taxes, provided the person paying such tax shall furnish such particular specification of such part, and in case the tax on the remainder thereof shall remain un- paid the collector shall enter such specification on his return to the county treasurer, clearly showing the part on which the tax remains unpaid, and if the part on which the tax 48 . THE TAX LAW. shall be so paid shall be an undivided share, the person pay- ing the same shall state to the collector who is the owner of such share, and the collector shall enter the name of such owner on his account of arrears of taxes, and such share shall be excepted in case of a sale for the tax on the re- mainder. 80. Payment of taxes on state lands in forest preserve The treasurer of the state, upon the certificate of the comp- troller as to the correct amount of such tax, shall pay the tax levied upon state lands in the forest preserve, by credit- ing to the treasurer of the county in which such lands may be situated, such taxes, upon the amount payable by such county treasurer to the state for state tax. ~No fees shall be allowed by the comptroller to the county treasurer for such portion of the state tax as is so paid. 81. Fees of collector. On all taxes paid within thirty days from the date of notice that he has received the roll, the collector shall be entitled to receive, if the aggregate amount shall not exceed two thousand dollars, two per centum, and otherwise one per centum, in addition thereto. On all taxes collected after the expiration of such period of thirty days, the collector shall be entitled to receive five per centum in addition thereto. The collector shall be en- titled to receive from the county treasurer i?wo per centum as fees for all taxes returned to the county treasury as unpaid. 82. Return by collector of unpaid taxes Every col- lector who makes and delivers to the county treasurer an ac- count of unpaid taxes, upon the tax-roll annexed to his war- rant, which he shall not have been able to collect, verified by his affidavit, that the sums mentioned therein remain unpaid, and that he has not, upon diligent inquiry, been able to dis- cover any personal property out of which the same could be collected by levy and sale, shall be credited by the county treasurer with the amount of such account. In making such return of unpaid taxes, the collector shall add thereto five per centum of the amount thereof. In case such tax is uncollected upon lands assessed to a resident he shall also THE TAX LAW. 49 state the reason why the same was not collected. Any col- lector who has heretofore failed in making such return of unpaid taxes, may make such return, whether his term of office has expired or not, verified by his affidavit, to the county treasurer any time within eight years after such fail- ure and before the lands against which said taxes are as- sessed, are advertised for sale pursuant to this act, and in case any collector shall heretofore or hereafter fail to add said five per centum the county treasurer shall add the afore- said five per centum of the amount of said uncollected tax as aforesaid. Such return shall be indorsed upon or at- tached to said roll, and shall be in the form to be prescribed by the state board of tax commissioners. Such tax and per- centage may be paid to the county treasurer at any time be- fore a return is made to the comptroller. The county treas- urer in counties in which lands are sold by him for the non- payment of taxes, is hereby authorized to incur and pay for such expenses as he may deem necessary for the exam- ination of collector's returns and descriptions of property to be sold pursuant to this act, and the procurement of proper collector's returns and the examinations and procurement of matters and facts as he may deem necessary to make a valid tax sale hereunder, but such expense shall not exceed the amount of the five per centum added as aforesaid. (Thus amended Toy L. 1901, chap. 517, talcing effect April 24, 1901.) 83. Return when collection has been enjoined. Any stay, lawfully granted by any court of record by injunction or other order or proceeding, of the collection of any tax exist- ing at the expiration of the period for the collection of the tax under any warrant or process in the hands of the col- lector or other officer for the collection thereof, or existing at the time of the expiration of the term of office of the col- lector or officer holding such warrant, shall operate as an extension of the time within which such collector or other officer may collect such tax until such stay is terminated and for the period of thirty days thereafter. As to all other taxes to be collected under any such warrant or process, the collector or officer holding the warrant or process shall make a return thereof within the time prescribed by law. 4 60 THE TAX LAW. 84. Payment of money collected. Every collector shall, within one week after the time prescribed in his warrant for the payment of the moneys directed therein to be paid, pay to the officers and persons specified therein, the sums re- quired in such warrant to be paid to them respectively. The officers and persons other than the county treasurer, to whom any such money shall be paid, shall deliver to the collector duplicate receipts therefor, one of which duplicates shall be filed by the collector with the county treasurer and shall entitle him to a credit in the books of the county treasurer for the amount therein stated to have been received, and no other evidence of such payment shall be received by the county treasurer. If any greater amount of taxes shall be levied in any town than the town charges thereof, and its proportionate share of the state taxes and county charges, the surplus shall be paid by the collector to the county treas- urer, who shall place it to the credit of such town, and it shall go to the reduction of the tax upon the town for the succeeding year. 85. Extension of time for collection. The county treas- urer, upon application of the supervisor of any town or com- mon council of any city in his county, may extend the time for collection of taxes remaining unpaid to a day not later than May first, following, in case the collector shall pay over all moneys collected by him and make his return of non- resident taxes, and renew his bond in a penalty twice the amount of the taxes remaining uncollected, approved by the proper officers upon filing the same, as the original bond is required to be filed, and delivering a certified copy thereof to such treasurer. Receivers of taxes who have filed a bond as required by statute shall not be required to renew their bonds. This section shall not affect any special law relat- ing to the extension of time for the collection of taxes, nor be construed to extend the time for the payment of the state tax by the county treasurer, as required by this chapter. County Law (L. 1892, ch. 686), 149. Extension of time for the collection of taxes. The county treasurer may extend the time for the collection of taxes in any town or ward, but no extension shall be permitted until the collector of taxes of the town, city or ward in which such extension shall be asked shall pay over to the county treas- urer all the taxes collected by him, and renew his undertaking as the THE TAX LAW. 51 supervisor of his town shall approve, and furnish evidence ty his oath, and other competent testimony, if any, as such treasurer shall re- quire, that he has been unable, for cause stated, to collect all the taxes within the time required by his warrant; but such extension shall not in any case be made beyond the first day of April in any year, unless ninety per cent, of such taxes shall have been collected and paid over to him. 86. Appointment of collector in case of vacancy If a per- son chosen to the office of collector of a town shall refuse to serve or be disabled from entering upon or completing the du- ties of his office from any cause, the town board shall forth- with appoint a collector for the remainder of the year, who shall give the same undertaking, be subject to the same duties and penalties and have the same powers and compensation as the collector in whose place he was appointed. The supervisor of the town shall forthwith give notice of such appointment to the county treasurer. Such appointment shall not ex- onerate the former collector or his sureties from any liabil- ity incurred by him or them. If a warrant shall have been issued by the board of supervisors before the appointment of a collector to fill a vacancy or before the appointment of a collector under this section, the original warrant, if ob- tainable, shall be delivered to the collector so appointed and shall give him the same powers as if originally issued to him. If such warrant is not obtainable, a new one shall be issued by the chairman and clerk of the board of supervisors of the county, directed to the collector appointed, with the same force and effect as if originally issued to him. Upon any such appointment, the supervisor of the town or ward, if he shall deem it necessary, may extend the time limited for the collection of taxes, for a period not exceeding thirty days, and forthwith give notice of such extension to the county treasurer. 87. When sheriff shall execute collector's warrant. If the collector of any tax district in the state shall neglect or refuse to execute an official bond or undertaking as required bv law, or the supervisor of the town shall refuse or neglect to approve and file the same, within the time prescribed by law, and a new collector shall not have been appointed within ten days after the time when such a bond or undertaking should'have been filed, the board of supervisors shall deliver 52 THE TAX LAW. the tax-roll or a copy thereof with the warrant annexed, to the sheriff, who shall give a like undertaking as is required from the collector, and who shall then proceed with the collection of the taxes levied therein in like manner as collectors are author- ized by law to do, and with like powers and subject to the same duties and obligations. Every such warrant shall require all payments therein specified to be made by the sheriff within sixty days after the receipt of the warrant by him. The expense of the collection of such taxes by him, if any, over and above the fees lawfully chargeable by the collector, shall be audited by the board of supervisors and shall be a charge upon the town. 88. Satisfaction of collector's bond. Upon the settlement of the account of taxes directed to be collected by a collector in any town or city, except in the city of New York, the county treasurer shall, if requested, and if the collector shall have fully paid over or duly accounted for all the taxes which he was by law to collect, give to such collector or any of his sureties, a written certificate -of such settlement, duly acknowledged, and upon the filing thereof in the office of the clerk of the county where the undertaking is recorded, the clerk shall enter satis- faction of such undertaking which shall thereby be discharged ; except that in counties containing cities of the first class such satisfaction when so entered shall only discharge the lien of said bond or undertaking upon the real estate of the collector and his sureties, but the liability of the collector and his sureties upon such bond or undertaking for a failure upon the part of such collector to pay over moneys collected by him shall be in no wise impaired. (Thus amended by L. 1899, chap. 321, talcing effect April 17, 1899.) 89. Unpaid taxes on resident real property to be reassessed. - When the tax on any real property, not assessed as non- resident, is returned as unpaid and so remains, the county treas- urer shall immediately deliver a transcript thereof to the super- visor of the tax district in which such tax was assessed. Such supervisor shall, if in his power, within thirty days thereafter, cause an accurate description of such real property to be made and returned to said treasurer, with the correct amount of taxes thereon, each kind of tax being stated separately, and if necessary, he may cause a survey and map of any of said real property to be made, and the expense of such survey and map THE TAX LAW. 53 on, or for each lot or parcel shall be returned to said treasurer, and be a legal charge upon such real property and be collected with the taxes thereon. The amount of such tax shall bear interest at the rate of eight per centum per annum from the first day of February until paid, or until the sale of such prop- erty to satisfy such tax by the county treasurer, or if the prop- erty is located in a county embracing a portion of the forest preserve, until the return of such unpaid tax to the comptroller. And such real property and the tax thereon shall be regarded for all purposes of assessment, collection and sale as non-resi- dent, and subject to all the provisions of the tax law in relation to non-resident real property and non-resident taxes. (Thus amended by L. 1902, chap. 171, in effect April 4, 1902.) 90. Payment to creditors of the county. Each county treasurer shall pay to the creditors of the county from the moneys paid to him by the collectors of taxes of the several towns therein, such sums and in such manner as the board of supervisors of the county direct. 91. Payment of state tax. The comptroller shall charge each county treasurer with the amount of the state tax levied on his county, except the tax for schools, crediting him with his fees, if any, but no fees shall be allowed by the comp- troller for such portion of the state tax as is credited by him for unpaid nonresident taxes. The county treasurer of each county shall, after retaining his fees thereon, at the rate of one per centum thereof, which shall not, however, in any case exceed fifteen hundred dollars, for all taxes for state purposes, including schools, pay the state tax to the treasurer of the state, as follows : One-third of the state tax exclusive of the state tax for schools on or before the fifteenth day of February, one-third thereof on or before the fifteenth day of April, and unless otherwise provided by law, the. balance thereof on or before the fifteenth day of May in each year, and notify the comptroller of such payment. Whenever the state tax for schools, payable by any county, shall exceed the apportionment to such county of state school moneys as made by the state superintendent of public instruction, in accordance with the provisions of the consolidated school law, such excess shall be paid by the treasurer of such county to the treasurer of the state on or before the fifteenth day of March in each year, and such treasurer shall notify the state superintendent of 54 THE TAX LAW. public instruction of such payment. If there are not sufficient funds in the county treasury standing to the credit of any town to pay the state tax chargeable thereto, the treasurer shall borrow sufficient money upon the credit of the county and charge the same against such town, with interest thereon until the same is paid. If any county treasure* shall not pay over the state tax, including state tax for schools, as herein directed, the comptroller shall charge on all sums withheld such rate of interest as shall be sufficient to repay all expenditures incurred by the state in borrowing money equivalent to the amount so withheld, and such additional rate as he shall deem proper, not exceeding ten per centum, from the dates hereinbefore pro- vided for such payments in each year, which shall be regarded as funds in the hands of the county treasurer belonging to the state and for which his sureties and county shall be liable. The fees of the county treasurer for collecting and paying over the school tax shall be allowed and paid by the superintendent of public instruction. (Thus amended by L. 1898, chap. 361, and L. 1902, chap. 378, in effect April 27, 1902.) 92. Accounts of county treasurer with comptroller. The comptroller shall state annually on June first, the account of each county treasurer, and if any part of a state tax is unpaid at that date, the comptroller shall transmit by mail to the county treasurer a copy of such accounts and a requisition that he must pay the balance due the state within thirty days, ami if the tax is not paid within such time, the comptroller shall, unless he is satisfied by due proof that the treasurer has not received such balance, and has used due diligence in collecting the same, forthwith deliver a copy of the account to the attorney- general, who shall take the necessary proceedings to collect the same of the county treasurer or his sureties or otherwise, with interest as provided by the last preceding section. The comp- troller may also, in his discretion, direct the board of super- visors of the county to institute the necessary proceedings on the undertaking of such county treasurer and his sureties. The comptroller shall also transmit to the board of supervisors on or before October tenth, a statement of account between his office and the county treasurer. 93. Losses by default of collector or treasurer. All losses sustained, and all deficiencies in any taxes, or in the THE TAX LAW. 65 payments to ta made therefrom, by reason of the default of any collector, shall be chargeable to the town, or city of which he is collector. If occasioned by the default of the treas- urer of any county in the discharge of his official duties, such losses shall be chargeable to such county. Any judgment against such treasurer for any such loss or deficiency on ac- count of the state tax upon which an execution shall have been issued and returned unsatisfied shall be conclusive as to the fact of such loss or deficiency, and the amount of such deficiency shall thereupon become a charge against such county, and the board of supervisors thereof shall add all such losses or deficiencies to the next year's taxes of such town, city or county, and levy the same thereon. 9-4. Receipts for taxes. The collector shall deliver a re- ceipt to each person paying a tax, specifying the date of such payment, the name of such person, the description of the property as shown on the assessment-roll, the name of the person to whom the same is assessed, the amount of such tax, and the date of the delivery to him of the assessment-roll on account of which such tax was paid. For the purpose of giving such receipt, each collector shall have a book of blank receipts, so arranged that when a receipt is torn therefrom a corresponding stub will remain. The state board of tax commissioners shall prescribe the form of such receipts, stubs and books and they shall be furnished to the collector by the board of supervisors, at the expense of the county. At the time of giving such a receipt, the collector shall make the same entries on the corresponding stub as are required to be made on the receipt. Such book shall be subject to public inspection and shall be filed by the collector with his return, together with the assessment-roll in the office of the county treasurer. (Thus amended by L. 1897, chap. 489.) 95. Article, how applicable. This article shall apply to all the cities or towns of the state, in so far as the matters herein provided for do not conflict with the special and local laws of such cities or towns. (Added by L. 1897, chap. 489.) 56 THE TAX LAW, AKTICLE V. {Section 100. Return of unpaid nonresident taxes. 101. Rejection of taxes. 102. Admission of nonresident taxes by comptroller and lit effect. 103. Payment to the county treasurer of excess of arrears credited. 104. Cancellation of tax by comptroller. 105. Transmittal of statement of cancelled taxes to board of supervisors. 106. Correction of imperfect descriptions. 107. Nonresident taxes, when and how paid the comptroller. 108. Reduction of overcharges. 109. Overpaid taxes. 100. Return of unpaid nonresident taxes. The collector shall return the original assessment-roll to the county treas- urer, and when the treasurer finds an account of unpaid taxes on real property or unpaid taxes on corporations, received from a collector to be a true transcript of such original assessment roll to which the collector's warrant is attached, with the descriptions furnished by the supervisor as provided in section eighty-nine, he shall add to it a certificate that he has examined and compared the account with such roll and found it to be correct, and after crediting the collector with the amount thereof, he shall, except in Saint Lawrence, Lewis, Clinton and Oneida counties, in case his county embraces a portion of the forest preserve, before the first day of May next ensuing, trans- mit such account, affidavit and certificate to the comptroller who may before acting thereon return any such account to the county treasurer for correction, who shall make such correction and return to the comptroller in one month thereafter or as the comptroller may otherwise direct. (Thus amended by L. 1898, chap. 362, by L. 1902, chap. 171, in effect April 4, 1902, and L. 1906, chap. 189, taking effect April 11, 1906.) 101. Rejection of taxes. The comptroller shall examine every account of arrears of taxes on lands of non-residents received from the county treasurer and reject all taxes en- tered therein, found to be erroneous, or charged on lands im- perfectly described, and shall annually on or about Sep- tember first, transmit to each county treasurer a transcript of the taxes of the preceding year in any tax district of his county, which shall have been rejected for any cause, with the grounds of such rejection. The comptroller may correct the description TITE TAX LAW. 57 of real property in cases where the error is of such nature that the word, word? or figures necessary to correct the same are self evident from the context. (Thus amended ly L. 1902, chap- 171, in effect April 4, 1902.) 102. Admission of nonresident taxes by comptroller and its effect. The comptroller shall admit all such taxes, prop- erly assessed, and credit the county treasurer therewith, and such account, when accepted by him, shall be deemed con- clusive evidence of the regularity and validity of all taxes therein so admitted, and all prior proceedings in assessing the lands and levying and collecting such taxes, except when it shall be satisfactorily proven to the comptroller that any such tax was paid in the county, or that there was no legal right to levy the same, or that it arose from a double assess- ment, the tax levied on one of which has been paid. 103. Payment to the county treasurer of excess of arrears credited. If the arrears of taxes on lands of nonresidents credited to the treasurer of any county by the comptroller shall exceed the state tax in such county, the comptroller shall pay such excess, or the whole amount of such arrears, if there be no state tax, after deducting therefrom any bal- ance due from the county, to the county treasurer, and the whole amount of such arrears and taxes shall thereafter be- long to the state and be collected for its benefit. 104. Cancellation of tax by comptroller. The comp- troller shall cancel any tax credited to a county upon the books in his office, which he shall discover after the trans- mission of the annual transcript of rejected taxes of such county to the county treasurer, to be erroneous, or charged on lands imperfectly described, and charge such taxes to the county in which such lands shall lie, with the interest thereon from March first, in the year following the levy of the taxes, to February first next after such cancellation. The comptroller shall cancel any tax returned as unpaid if it shall be made to appear to him that previously to such re- turn it was paid to the collector or county treasurer, and if it shall also have been paid into the state treasury, he shall cause it to be repaid out of the treasury to the person by whom such payment shall have been made. 58 THE TAX LAW. 105. Transmittal of statement of canceled taxes to board of supervisors. The comptroller shall transmit a transcript of the returns of all taxes canceled, with the addition of in- terest thereon, to the county treasurer, who shall deliver a copy thereof to a supervisor of the tax district in which such taxes were assessed, by whom it shall be returned to the board of supervisors at their next annual meeting. If such tax district shall have been divided since the assessment, the county treasurer shall deliver such transcript to the board of supervisors at their next annual meeting. If any such cancellation was by reason of tke tax having been paid be- fore the same was returned by the county treasurer, such treasurer, shall present the transcript to the board of super- visors of the county, and the amount of such tax, with the interest, shall be collected by such board of the collector or the county treasurer who made the erroneous returns, and shall be paid into the state treasury. 106. Correction of imperfect descriptions. The super- visor of the tax district in which any lands are situated, upon which a tax shall have been rejected by the comptroller, or shall have been canceled and charged to the county to which it had previously been credited, shall add to the assessment- roll of the tax district in which the land is situated for the year during which a transcript of the returns of such taxes shall have been forwarded by the comptroller to the county treasurer, an accurate description of such lands, if he can obtain the same, the correct amount of taxes thereon, the tax of each year and each kind of tax separately, and shall furnish the comptroller with all such maps and surveys of such lands as shall be required by him. Such supervisor may, if necessary, cause a survey and map of each lot or parcel returned for more perfect description to be made, and the expense of such survey and map shall be a town charge. The board of supervisors shall direct the collection of such taxes so added to such assessment-roll, and they shall be considered the taxes of the year in which the de- scription shall be perfected. If any such supervisor shall not fully comply with the provisions of this section the comptroller shall not thereafter admit, but shall reject, all such reassessed, canceled or rejected taxes as may be re- THE TAX LAW. 59 turned to him. If such taxes are not levied upon such lands as herein required, the board of supervisors shall cause the same, with interest thereon, to be levied upon the tax dis- trict in which originally assessed, and collected with the other taxes of the same year. If the tax district shall have been divided since such assessment, such taxes and interest shall be apportioned by the board of supervisors among the tax districts included in the limits of such original tax dis- tricts in such equitable manner as it may deem proper. [L. 1878, chap. 152, 19, was repealed by the Tax Law, but L. 1896, chap. 951, amending such section, was not repealed, and having been passed at the same session as the Tax Law, is, pursuant to section 31 of the Statutory Construction Law, still in force, we have, therefore, inserted it in this place.] 19. Whenever the comptroller shall have rejected any tax in the first instance, or have canceled and charged the same to the county to which it had previously been credited, the supervisor of the town or ward in which such lands are situate, shall, if in his power, add to the assessment-roll of such town or ward for the year during which such transcript shall have been forwarded by the comptroller to the county treasurer, an accurate description of such lands and the correct amount of taxes thereon, stating the tax of each year and each kind of tax, separately, and shall furnish the comptroller with all such maps and surveys of such lands as shall have been required by him ; and, if neces- sary, he may cause a survey and map of each lot or parcel returned for more perfect description to be made and the expense of such survey and map shall be a charge upon such land to be added to the tax thereon, the board of supervisors shall direct the collection of such taxes and the expenses eo added to such assessment-roll, and they shall, for all the purposes of this act, be considered as taxes of the year in which the description shall be perfected. If the supervisor of such town or ward shall not have fully complied with the requirements of this sec- tion, the comptroller shall not thereafter admit, but shall reject all such reassessed, canceled or rejected taxes as may be returned to him. Whenever any tax has been rejected by the comptroller and returned to the county to which it had previously been credited, the board of supervisors of such county, or if there be no board of supervisors of such county, then the board of aldermen performing the duties of super- visors, shall direct that such rejected tax be canceled upon the tax-roll in the office of the treasurer of the county, for the year or years for which it was levied. I 107. Nonresident taxes, when and how paid to comp- troller. The comptroller shall, at any time after August first, next after receiving statement thereof from the county treasurer, furnish any person desiring to pay the taxes on any parcel of land, a certificate of the amount of such taxes, interest and charges, and the state treasurer may receive payment therefor upon such certificate, which shall be countersigned by the comptroller and entered in the books of his office. Such interest shall begin August first, of such 60 THE TAX LAW. year, and be at the rate of ten per centum per annum. Any person claiming a divided or undivided part in any parcel may pay to the state treasurer any part of the amount due thereon, proportionate to the share or interest claimed by him, on the certificate of the comptroller. The remaining tax and charges shall be a lien on the residue of the land or interest only. If the land has been subdivided since the assessment, the comptroller may require a map of the sub- divisions. Any person may pay the tax for any one year on any tract or lot of land without paying the tax of any other year. 108. Deduction of overcharges If any tract or lot of land shall have been returned as containing a greater quan- tity of land than it actually contained, the amount over- charged shall be deducted. If the tax shall have been paid according to such return, the overcharge shall be refunded out of the treasury upon the production to the comptroller of satisfactory proof of the quantity actually contained in each tract or lot at the time of the assessment. JSTo such overcharge shall be canceled nor such over-payments re- funded, unless application shall be made to the comptroller before the sale of such lands, and within six years after the assessment. If the whole amount of the tax shall have been paid to the county treasurer out of the state treasury, the comptroller shall charge the amount so refunded with in- terest and charges thereon to the treasurer of the county to which the tax was returned, and shall transmit an account thereof to him. The county treasurer shall deliver such ac- count to the board of supervisors at their next annual meet- ing, which shall cause the amount thereof to be added to the taxes of the tax district in which the tax was assessed, and when collected it shall be paid into the treasury of the county. 109. Overpaid taxes. If it shall satisfactorily appear to the comptroller that the amount of any tax has been paid, and afterwards other money has been paid into the state treasury on account of such tax or that the amount of any tax has been overpaid to the treasurer of the state, he may draw his warrant on the treasury for the amount paid in excess of the tax due, in favor of the person paying the same. ARTICLE VI. SALE BY COMPTROLLER FOR UNPAID TAXES AND REDEMP- TION OF LANDS. Section 120. Notice of sale. 121. Maps to be furnished comptroller. 122. Sale, how conducted. 123. Purchases by comptroller, for state or county. 124. Withdrawal from sale of lands upon which the state haa a lien. 125. Payment of bids and certificate of purchase. 126. New certificate upon setting aside sale. 127. Redemption of lands. 128. Redemption of lands conjointly assessed. 129. Prohibition of the despoliation of lands sold. 130. Notice of unredeemed lands. 131. Comptroller's deed. 132. Effect of former deeds. 133. Possession of lands by the state. 134. Notice to occupants. 135. Certificate of nonredemption and completion of title. 136. Redemption by occupant and certificate ol redemption. 137. Redemption by occupant before notice and effect of failure to redeem. 138. Lien of mortgage not affected by tax sale. 139. Redemption by mortgagee before notice. 140. Cancellation of sales. 141. Setting aside cancellation of sale. 142. Expenses of sale. 143. Payment of moneys into state treasury. 120. Notice of sale The comptroller may sell any lands heretofore or hereafter returned to him for nonpay- ment of any tax thereon, if such tax and the interest thereon, or any part thereof shall remain unpaid for one year after February first, following the year in which the tax was levied. He shall make out a list of all such lands in any county and transmit to the county treasurer thereof at least eighteen weeks before the commencement of the sale, a num- ber of copies of such list sufficient to furnish five copies to the county treasurer, two copies to the county clerk and two copies to the clerk of each town and city in which such lands are situated. The county treasurer shall transmit the same to such officers. The comptroller shall publish such list with a notice, that on a day specified therein and the succeeding 62 THE TAX LAW. days, so much of such lands as may be necessary to discharge the taxes, interest and charges due thereon at the time of sale, will be sold at public auction at the capitol in the city of Albany. Such list shall be inserted in two newspapers published in such county, once in each week for twelve suc- cessive weeks prior to the commencement of the sale, and in the body of the newspapers and not in a supplement. If there are not two newspapers published in the county, the publication shall be in two newspapers which the comptroller shall determine to be most generally circulated in the county. Due proof of the publication of such list and notice in each newspaper shall be made and filed in the office of the comp- troller, within twenty days after the last publication. The expense of printing, publishing and transmitting such list shall be audited by the comptroller and paid out of the state treasury. No error in the description of the lands in any list published in any newspaper shall render any sale void or in any manner affect its validity. 121. Maps to be furnished comptroller. The comptroller may apply to the supervisor of any town for maps of any tract of land returned from such town for nonpayment of taxes, if he deem it necessary in order to test the correctness of the description thereof, preparatory to a sale of such lands, and the supervisor shall furnish such maps at the ex- pense of the town, if they can be procured; if not, he shall furnish such descriptions of the lands as he can obtain, with a statement of the quantity in each subdivision, if the same is divided. The treasurer of every county shall, on receiving a list of lands to be sold at a state sale transmit to the comp- troller at least one month before any state tax sale, a certi- fied list of all lands bid in at any tax sale, in the name of such county, or transferred to such county upon any such sale, or to which the county may have acquired a tax title, the deed for which has not been recorded in the office of the clerk of the county, which may then be liable to be sold at such sale. Every county clerk shall, on receipt of a list of the lands therein liable to be sold at any state tax sale, and at least one month before the sale, transmit to the comp- troller a certified list of all lands the conveyances of which are on record in his office, then owned by such county, and liable to be sold at such sale. THE TAX LAW. 63 122. Sale, how conducted. On the day mentioned in the notice of sale the comptroller shall commence the sale of the lands specified in the lists annexed to the notice, and con- tinue the sale from day to day, until so much of each parcel shall be sold as will be sufficient to pay all the taxes thereon for the years for the taxes of which such sale shall be made, with the interest and charges thereon. In case no pur- chaser bids the amount due on any lot or parcel, the comp- troller is authorized to bid in such lot or parcel for the state. The comptroller may, in his discretion, decline to receive any bid on any parcel of land, if in his opinion, it is made by or for any person not acting in good faith, and any such land shall be sold at such sale the same as if such bid had not been made thereon. And in case the land is located in a county outside the forest preserve, the comptroller may sell and assign the certificate therefor at any time before the expiration of the period for redemption, on such terms as to him shall seem for the best interests of the state. 123. Purchases by the comptroller for state or county. The comptroller shall bid in for the state all lands of the state, and also all lands which may have been bid in by or for the state at any tax sale which has not been canceled, or from which said lands have not been duly redeemed, liable to be sold at any tax sale held by him, or lands that are then mortgaged to the commissioners for loaning certain moneys of the United States and for each county, all lands belong- ing to such county liable to be sold at such sale, and also all lands which may have been bid in by or for such county at any tax sale which has not been canceled or from which said lands have not been duly redeemed; and to reject any and all bids made for any of such lands. The comptroller shall make certificates of sales for all lands so bid in by him, describing the lands purchased and specifying the time when a deed therefor can be obtained. Such purchases shall be subject to the same right of redemption as purchases by indi- viduals; and if the land so sold shall not be redeemed, the comptroller's deed therefor shall have the same effect and become absolute in the same time, and on the performance of the like conditions, as in the case of sales and conveyances to individuals. The comptroller shall charge to each county, 64 THE TAX LAW. on the books of his office, the amount for which it may be liable, by reason of any purchase made in accordance with this section, and such amount shall become due on the last day of each tax sale, and shall be payable in the same man- ner as the state tax is required by law to be paid. The comp- troller shall, as soon as practicable, after each tax sale, trans- mit the certificates of sale for such lands to the treasurer of each of such counties, on receipt of which the county treas- urer shall enter the same, in their proper order, in a book to be kept by him for such purpose, and unless otherwise di- rected by the board of supervisors of his county, shall have full power and authority, until the expiration of one year from the last day of such sale, to sell and assign any of such certificates for any land not at the time owned by his county, on payment therefor, into the county treasury, of the amount for which the land described therein was sold at such tax sale, with interest thereon, from the date of such tax sale to the date of such sale and assignment by him. AH such sales and assignments shall be duly and fully entered by such county treasurer in such book, which book shall be a part of the records of the county. If any such tax sale certificate shall not have been sold or assigned by the respective county treasurers on or before the expiration of one year from the last day of such sale, each of such county treasurers shall then transmit such unsold certificate or certificates to the comptroller, who shall issue to the board of supervisors of each county, respectively, a deed or deeds for all of the lands described thereon then remaining unredeemed, or the sale for which has not been canceled. The title thus ac- quired by the boards of supervisors shall be held by them in trust for their respective counties, and may be disposed of by them at such times and on such terms as shall be deter- mined by a majority of such board at any regular or special meeting thereof. (Thus amended by L. 1897, cJiap. 233.) 124. Withdrawal from sale of lands upon which the state has a lien. No land against which the people of the state of New York hold a bond or lien for any part of the pur- chase price thereof shall be sold, but all such land shall be withdrawn from such sale. The amount of taxes, interest and expenses for which it may be liable to sale as shown by THE TAX LAW. 6 the comptroller's book of sales shall be charged against each lot, piece or parcel of such land in the books in the comp- troller's office in which the accounts of school funds and other bonded lands are kept, and the state treasurer shall, on the receipt of a statement of such amounts, charge the same against the respective lots, pieces or parcels of land, on which they are due, on the duplicate bond-books kept in his office. The holder of the certificate or contract of purchase of any such land, may discharge the same from liability in consequence of such charge, by paying to the state treasurer at any time within two years after the last day of sale from which such lands were withdrawn, the amount of such charges with interest thereon at the rate of ten per centum annually. If such payment is not made, the comptroller shall, at the expiration of such two years, state an account of the indebtedness against each lot, piece or parcel of such land, with the addition of thirty-seven and one-half per centum thereto, and the amount of principal and interest due on the bond or lien thereon, to the commissioners of the land office, who may thereupon, if default shall be made in the payment of such bond, direct the comptroller to put the same in suit, or shall direct the state engineer and surveyor to again sell the lands against which such indebtedness re- mains. Upon any sale thereof, all previous payments made on account of such land shall be forfeited to the people of the state. No conveyance of any such lands shall be made to any purchaser, until all such taxes and expenses charged against the same on such bond-book are paid into the state treasury. 125. Payment of "bids and certificate of purchase. - Every purchaser at any sale of lands by the comptroller under this article shall pay the amount of his bid to the state treasurer within forty-eight hours after the last day of sale. Upon the payment of a bid to the comptroller he shall give to the purchaser a written certificate, describing the lands purchased, the sum paid and the time when the purchaser will be entitled to a deed. 126. New certificate upon setting aside sale. If a pur- chaser shall not have paid his bid, or the same shall not have 5 66 THE TAX LAW. been collected from him at the expiration of one month from the conclusion of the sale, at which the bid was made, the comptroller may set aside the sale of land for which the bid was made, and all the rights of the purchaser under such bid shall thereby be extinguished, and the comptroller shall issue a certificate of such sale if the land be in a county including a portion of the forest preserve, to the people of the state. If said land be in a county not including any portion of the forest preserve, such certificate shall be issued to any person who will pay the same amount as would be payable by the original purchaser in case the sale had not been set aside. If such certificate shall not have been sold within three months from the date of such sale he shall transfer the same to the people of the state. If the transfer be to the people, the whole quantity of land liable to sale for the purchase-money mentioned in the certificate shall be covered by such purchase, the same as if no person had offered to bid therefor at the sale. The change of- purchaser made pursuant to this section and the time when made shall be noted in the sales book, and the certificates issued shall confer the same right upon the state as it would have ac- quired had the land been bid in for it at the sale. 127. Redemption of lands The owner or occupant of any lands sold by the comptroller for taxes, or any other person having an interest therein at the time of the sale, may redeem the same from such sale at any time within one year after the last day of the sale, by paying to the state treasurer, on the certificate of the comptroller for the use of the purchaser, his heirs or assigns, the sum mentioned in the certificate of sale therefor, with interest thereon at the rate of ten per centum per annum, after the date of such certificate of sale. The purchaser of any wild, vacant or unoccupied land at any such sale, or his assigns, shall not enter upon or exercise acts of ownership on such land, until the expiration of one year allowed for the redemption thereof from such sale. A person having an interest in an undi- vided part of any tract, lot or piece of land so sold, or in an undivided share in any tract or lot of land out of which an undivided part shall have been sold, may redeem such undi- vided part or share by paying such proportion of the pur- THE TAX LAW. 6T chase-money and interest as shall he in proportion to the part or share of the lands sold which he shall claim. Every person having an interest in a specific part of any tract, lot or piece of land, so sold, or lot of land out of which an un- divided part may have been sold for taxes charged on the whole tract or lot, may redeem such specific part by paying such proportion of the purchase money and interest as his quantity of acres shall bear to the whole quantity of acres sold, or to the whole quantity taxed. Any person claiming a specific part of any tract or lot of land, out of which a specific part belonging to some other person shall have been sold for taxes charged on the whole tract or lot, may exonerate him- self from all liability to contribute to the owner of the part sold, by paying to the comptroller at any time before the expiration of the time allowed for the redemption thereof, such proportion of the purchase-money and interest as his quantity of acres shall bear to the whole quantity taxed, and such payment shall operate as a redemption of his propor- tionate part of the lands sold according to the amount paid. Upon a partial redemption under this section, the quantity sold shall be reduced in proportion to the amount paid on such partial redemption and the comptroller shall convey accordingly. 128. Redemption of lands conjointly assessed If the lands of one person shall be sold for taxes assessed con- jointly on his lands and lands of another, and the latter shall not pay his due proportion required for the redemption of his lands, the former may redeem the same on paying to the comptroller the purchase-money and interest, and he ah all be entitled to recover, after the expiration of the time allowed for redemption, from the other person whose lands were assessed with his, a just proportion of the redemption moneys paid, with interest. If the lands of one person so sold for taxes assessed conjointly on his lands and the lands of another person, shall not be redeemed, and they shall be conveyed by the comptroller, the former may recover from the latter the same proportion of the value of the lands sold and conveyed, that the latter ought to have paid of the tax and interest and charges for which the lands shall have been sold. Every judgment obtained under this section shall have 68 THE TAX LAW. priority as against the lands of the defendant therein, on which the tax was assessed, and for which such propor- tionate part ought to have been paid, over all mortgages and judgments, if at the time of docketing such judgment the plaintiff cause an entry to be made by the clerk in the docket thereof, specifying that such judgment has priority as a lien on certain lands, over mortgages and other judgments, pur- suant to the tax law, which entry shall be a part of such docket. In all actions under this section, the certificate of the state treasurer, countersigned by the comptroller, stating the facts in relation to such redemption, or sale and con- veyance, shall be presumptive evidence of all facts therein stated. 129. Prohibition of the despoliation of lands sold. Neither the owner, occupant nor any other person shall have the right to despoil any lands sold for taxes by the comptrol- ler of their value, by the removal of buildings or "by cutting, removing or destroying timber, or other valuable products, growing, existing or being thereon at the time of sale. The purchaser of any wild, vacant, or unoccupied land at the sale thereof by the comptroller, whose bid therefor shall havo been fully paid, or his assigns or representatives may at any time before obtaining his deed, cause to be served a notice on any person despoiling such lands or interested in such de- spoliation, either personally or by leaving the same at the residence of such person, or with any member of his family of suitable age and discretion. The notice shall describe such lands, substantially as sold, shall state that it was sold for taxes by the comptroller, and that an action to recover the value of the buildings, timber or other products destroyed or removed therefrom, after the date of sale thereof, will be instituted against all persons concerned in such despoliation. If such lands shall not be redeemed, every person engaged or interested in making such despoliation, upon whom ser- vice of the notice shall have been made, shall bs liable to pay to the holder of the tax sale certificate therefor the full value of any building so destroyed or removed thevof/om, and of all the timber, bark, or other products so manded, or that payment has been legally made or exacted of any such account, he shall resettle the same according to law and the facts and charge or credit, as the case may require, the difference, if any, result- ing from such revision or resettlement upon the accounts for taxes of or against any such person, partnership, company, association or corpora- tion. Such credit, whether allowed before or after the passage of this act, may be, by the person, partnership, company, association or corpora- tion in whose favor it is allowed, assigned to a person, partnership, company, association or corporation liable to pay tares under article nine of this act and the assignee of the whole or any pait of such credit on filing with the comptroller such assignment shall thereupon be en- titled to credit on the books of the comptroller for the amount thereof on the current account for taxes of such assignee in the same way and with the same effect as though the credit had originally been allowed in favor of such assignee. The comptroller shall forthwith send writ- ten notice of his determination upon such application to the applicant, and to the attorney-general, which notice may be sent by mail to his post-office address. (Thus amended ty L. 1903, chap. 642, taking effect May 22, 1903.) 1&6. Review of determination, of comptroller by certiorari. The determination of the comptroller upon any applica- tion made to him by any person, partnership, company, as- sociation or corporation for a revision and resettlement of any account, as prescribed in this article, may be reviewed both upon the law and the facts, upon certiorari by the su- preme court at the instance of any person, partnership, company, association or corporation affected thereby, and in -the name and on behalf of the people of the state. For the purpose of such review the comptroller shall return, on such certiorari, the accounts and all the evidence before him on such application, and all the papers and proofs upon^the original statement of such account and all proceeding's thereon. If the original or resettled accounts shall be found erroneous or illegal, either in point of law or of fact, by the supreme court, upon any such review, the accounts reviewed 104 THE TAX LAW. shall then be corrected and restated, and from any determina- tion of the supreme court upon any such review, an appeal to the court of appeals may be taken by either party. 197. Regulations as to snch writ of certiorari. No cer- tiorari to review any audit and statement of an account or any determination by the comptroller under this article, shall be granted unless notice of application therefor is made within thirty days after the service of the notice of such de- termination. Eight days' notice shall be given to the comp- troller of the application for such writ. The full amount of the taxes, percentage, interest and other charges, audited and stated in such account must be deposited with the state treasurer before making the application and an undertaking filed with the comptroller in such amount and with such sureties as a justice of the supreme court shall approve to the effect that if such writ is dismissed or the determination of the comptroller affirmed, the applicant for the writ will pay all costs and charges which may accrue against him, or it in the prosecution of the writ, including costs of all ap- peals. 198. Warrant for the collection of taxes. After the expiration of thirty days from the sending by the comptrol- ler of a notice of a statement of an account as provided in this article, unless the amount of such account shall have been paid or deposited with the state treasurer, if an appeal or other proceedings have been taken to review the same, and the undertaking given as provided in this article, the comp- troller may issue a warrant under his hand and official seal, directed to the sheriff of any county of the state, command- ing him to levy upon and sell the real and personal property of the person, partnership, company, association or corpora- tion against which such account is stated, found within his county for the payment of the amount thereof with interest thereon and costs of executing the warrant, and to return such warrant to the comptroller, and pay to the state treas- urer the money collected by virtue thereof, by a time to be therein specified, not less than sixty days from the date of the warrant. Such warrant shall be a lien upon and shall bind the real and personal property of the person, partner- THE TAX LAW. 105 ship, company, association or corporation against which it is issued, from the time an actual levy shall be made by vir- tue thereof. The sheriff to whom any such warrant shall be directed shall proceed upon the same in all respects, with like effect, and in the same manner as prescribed by law in respect to executions issued against property upon judgments of a court of record, and shall be entitled to the same fees for his services in executing the warrant, to be collected in the same manner. 199. Information of delinquents. It shall be the duty of any person having knowledge of the evasion of taxation un- der this article by any corporation, association, joint-stock company, partnership or person liable to taxation thereunder, for any omission on their part to make the reports required by this article, to make a written report thereof to the comp- troller of the state, with such information as may be in his possession as may lead to the recovery of any taxes due the state therefrom. If, in his opinion, the interests of the state require it, the comptroller may employ such person to assist in the collection and preparation of evidence and in the pros- ecution and trial of actions for such taxes, and so much of the same, not exceeding ten per centum thereof, as may be collected from any such delinquent corporation, association, company, partnership or person, by reason of such report and such services, as shall have been agreed upon between such person and the comptroller or attorney-general as a compensation therefor, shall be paid to such person, and nothing shall be paid to such person for such report or ser- vices unless there shall be a recovery of taxes by reason thereof. 200. Action for recovery of taxes; forfeiture of charter of delinquent corporation. An action may be brought by the attorney-general, at the instance of the comptroller, in the name of the state, to recover the amount of any account audited and stated by the comptroller under the provisions of this article. If any such account shall remain unpaid at the expiration of one year after notice of the statement thereof has been sent as required by this article, and the 106 THE TAX LAW. < comptroller is satisfied that the failure to pay the same is intentional, he shall so report to the attorney-general, who shall immediately bring an action, in the name of the peo- ple of the state, for the forfeiture of the franchise of any corporation, joint-stock company or association failing to make such payment, and if it is found that such failure was intentional, judgment shall be rendered in such action for the forfeiture of its franchise and for its dissolution, and thereafter such franchise shall be annulled. 201. Reports to be made by the secretary of state. The secretary of state shall transmit on the first day of each month, to the comptroller, a report of the stock corporations whose certificates of incorporation are filed, or of the foreign stock corporations to whom a certificate of authority has been issued to do business in this state, during the preceding month. Such report shall state the name of the corporation, its place of business, the amount of its capital stock, its pur- poses or objects, the names and places of residence of its directors, and, if a foreign corporation, its place of business within the state. The comptroller may prescribe the forms and furnish the blanks for such reports. The secretary of state shall make like reports to the comptroller whenever re- quired by him relating to any such corporations whose cer- tificates have been filed or to whom a certificate of authority has been issued prior to the time when this article takes effect, and during any period of time specified by the comp- troller in his request for such report. 202. Exemptions from other state taxation. The per- sonal property of every corporation, company, association or partnership, taxable under this article, other than for an or- ganization tax, shall be exempt from assessment and taxation upon its personal property for state purposes, and the per- sonal property of every corporation taxable under section one hundred and eighty-seven-a of this article, other than for an organization tax, and as provided in chapter thirty-seven of the general laws, shall be exempt from assessment and taxa- tion for all other purposes, if all taxes due and payable under this article have been paid thereby. The personal property of a private or individual banker, actually employed in his THE TAX LAW. 107 business as such banker, shall be exempt from taxation for state purposes, if such private or individual banker shall have paid all taxes due and payable under this article. Such corporation and private or individual banker shall in no other respect be relieved from assessment and taxation by reason of the provisions of this article. The owner and holder of stock in an incorporated trust company liable to taxation under the provisions of this act shall not be taxed as an individual for such stock. (Thus amended by L. 1901,, chap. 132, and L. 1902, chap. 172, in effect April 6, 1902.) 203. Application of taxes. The taxes imposed by this article and the revenues thereof shall be applicable to the general fund of the treasury and to the payment of all claims and demands which are a lawful charge thereon. 108 THE TAX LAW. ARTICLE X. TAXABLE TRANSFERS. (Entire article amended by L. 1905, chap. 368, to read as follows, in effect June 1, 1905. ) Section 220. Taxable transfers. 221. Exceptions and limitations. 222. Accrual and payment of tax. 223. Discount and interest. 224. Lien of tax and collection by executors, administrators and trustees. 225. Refund of tax erroneously paid. 226. Taxes upon devises and bequests in lieu of commissions. 227. Liability of certain corporations to tax. 228. Jurisdiction of the surrogate. 229. Appointment of appraisers, stenographers, et cetera. 230. Proceedings by appraiser. 231. Determination of surrogate. 232. Appeal and other proceedings. 233. Composition of transfer tax upon certain estates. 234. Surrogate's assistants in New York, Kings and other counties. 235. Proceedings by district attorneys. 236. Receipt from county treasurer or comptroller. 237. Fees of county treasurer. 238. Books and forms to be furnished by the state comptroller. 239. Reports of surrogate and county clerk. 240. Reports of county treasurer. 240-a. Report of state comptroller; payment of taxes. 241. Application of taxes. 242. Definitions. 243. Exemptions in article one not applicable. Section 220. Taxable transfers. A tax shall be and is hereby imposed upon the transfer of any property, real or per- sonal, of the value of five hundred dollars or over, or of any interest therein or income therefrom, in trust or otherwise, to persons or corporations not exempt by law from taxation on real or personal property, in the following cases: THE TAX LAW. 109 1. When the transfer is by will or by the intestate laws of this state from any person dying seized or possessed of the prop- erty while a resident of the state. 2. When the transfer is by will or intestate law, of property within the state, and the decedent was a nonresident of the state at the time of his death. 3. When the transfer is of property made by a resident or by a nonresident when such nonresident's property is within this state, by deed, grant, bargain, sale or gift made in contempla- tion of the death of the grantor, vendor or donor, or intended to take effect in possession or enjoyment at or after such death. 4. When any such person or corporation becomes beneficially entitled, in possession or expectancy, to any property or the income thereof by any such transfer, whether made before or after the passage of this act. 5. Whenever any person or corporation shall exercise a power of appointment derived from any disposition of property made either before or after the passage of this act, such appointment when made shall be deemed a transfer taxable under the pro- visions of this act in the same manner as though the property to which such appointment relates belonged absolutely to the donee of such power and had been bequeathed or devised by such donee by will ; and whenever any person or corporation possessing such a power of appointment so derived shall omit or fail to exercise the same within the time provided therefor, in whole or in part, a transfer taxable under the provisions of this act shall be deemed to take place to the extent of such omission or failure, in the same manner as though the persons or corporations thereby becoming entitled to the possession or enjoyment of the property to which such power related had suc- ceeded thereto by a will of the donee of the power failing to exercise such power, taking effect at the time of such omission or failure. 6. The tax imposed hereby shall be at the rate of five per centum upon the clear market value of such property, except 110 THE TAX LAW. as otherwise prescribed in the next section. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 221. Exceptions and limitations. When property real or personal or any beneficial. interest therein, of the value of less than ten thousand dollars, .passes by any such transfer to or for the use of any father, mother, husband, wife, child, brother, sister, wife or widow of a son or the husband of a daughter, or any child or children adopted as such in conformity with the laws of this state, of the decedent, grantor, donor or vendor, or to any child to whom any such decedent, grantor, donor or vendor for not less than ten years prior to such transfer stood in the mutually acknowledged relation of a parent, provided, however, such relationship began at or before the child's fifteenth birthday and was continuous for said ten years there- after, and provided also that the parents of such child shall be deceased when such relationship commenced, or to any lineal descendant of such decedent, grantor, donor or vendor born in lawful wedlock, such transfer of property shall not be taxable under this act; if real or personal property, or any beneficial interest therein, so transferred is of the value of ten thousand dollars or more, it shall be taxable under this act at the rate of one percentum upon the clear market value of such property. But any property devised or bequeathed to any person who is a bishop or to any religious, educational, charitable, missionary, benevolent, hospital or infirmary corporation including corpora- tions organized exclusively for bible or tract purposes shall be exempted from and not subject to the provisions of this act. There shall also be exempted from and not subject to the pro- visions of this act personal property other than money or securities bequeathed to a corporation or association organized exclusively for the moral or mental improvement of men or women or for scientific, literary, library, patriotic, cemetery or historical purposes or for the enforcement of laws relating to children or animals or for two or more of such purposes and used exclusively for carrying out one or more of such purposes. But no such corporation or association shall be entitled to such exemption if any officer, member, or employee thereof shall receive or may be lawfully entitled to receive any pecuniary THE TAX LAW. Ill profit from the operations thereof except reasonable compensa- tion for services in effecting one or more of such purposes or as proper beneficiaries of its strictly charitable purposes; or if t/ie organization thereof for any such avowed purpose be a guise or pretense for directly or indirectly making any other pe- cuniary profit for such corporation or association or for any of its members or employees or if it be not in good faith or- ganized or conducted exclusively for one or more of such pur- poses. (Thus amended ~by L. 1905, ch. 368, in effect June 1, 1905.) 222. Accrual and payment of tax. All taxes imposed by this article shall be due and payable at the time of the transfer, except as herein otherwise provided. Taxes upon the transfsr of any estate, property or interest therein limited, conditioned, dependent or determinable upon the happening of any contin- gency or future event by reason of which the fair market value thereof cannot be ascertained at the time of the transfer as herein provided, shall accrue and become due and payable when the persons or corporations beneficially entitled thereto shall come into actual possession or enjoyment thereof. Such tax shall be paid to the state comptroller in a county in which the office of appraiser is salaried, and in other counties, to the county treasurer, and said state comptroller or county treasurer shall give, and every executor, administrator or trustee shall take, duplicate receipts from him of such payment as provided in section two hundred and thirty-six. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 223. Discount, and interest. If such tax is paid within six months from the accrual thereof, a discount of five per centum shall be allowed and deducted therefrom. If such tax is not paid within eighteen months from the accrual thereof, interest shall be charged and collected thereon at the rate of ten per centum per annum from the time the tax accrued; unless by reason of claims made upon the estate, necessary litigation or other unavoidable cause of delay, such tax can not be determined and paid as herein provided, in which case interest at the rate of six per centum per annum shall be charged upon such tax from the accrual thereof until the cause 112 THE TAX LAW. of such delay is removed, after which ten per centum shall be charged. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 224. Lien of tax and collection by executors, administra- tors and trustees. Every such tax shall be and remain a lien upon the property transferred until paid and the person to whom the property is so transferred, and the executors, admin- istrators and trustees of every estate so transferred shall be personally liable for such tax until its payment. Every execu- tor, administrator or trustee, shall have full power to sell so much of the property of the decedent as will enable him to pay such tax in the same manner as he might be entitled by law to do for the payment of the debts of the testator or intestate. Any such executor, administrator or trustee having in charge or in trust any legacy or property for distribution subject to such tax shall deduct the tax therefrom and shall pay over the same to the state comptroller or county treasurer, as herein provided. If such legacy or property be not in money, he shall collect the tax thereon upon the appraised value thereof from the person entitled thereto. He shall not deliver or be com- pelled to deliver any specific legacy or property subject to tax under this article to any person until he shall have collected the tax thereon. If any such legacy shall be charged upon or payable out of real property, the heir or devisee shall deduct such tax therefrom and pay it to the executor, administrator or trustee, and the tax shall remain a lien or charge on such real property until paid; and the payment thereof shall be enforced by the executor, administrator or trustee in the same manner that payment of the legacy might be enforced, or by the district attorney under section two hundred and thirty-five of this chap- ter. If any such legacy shall be given in money to any such person for a limited period, the executor, administrator or trustee shall retain the tax upon the whole amount, but if it be not in money, he shall make application to the court having jurisdiction of an accounting by him, to make an apportion- ment, if the case require it, of the sum to be paid into his hands by such legatees, and for such further order relative THE TAX LAW. 113 thereto as the case may require. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 225. Refund of tax erroneously paid. If any debts shall be proven against the estate of a decedent after the payment of any legacy or distributive share thereof, from which any such tax has been deducted or upon which it has been paid by the person entitled to such legacy or distributive share, and such person is required by order of the surrogate having jurisdiction, on notice to the state comptroller, to refund the amount of such debts or any part thereof, an equitable proportion of the tax shall be repaid to him by the executor, administrator or trustee, if the tax has not been paid to the state comptroller or county treasurer ; or if such tax has been paid to such state comptroller or county treasurer, such officer shall refund out of the funds in his hands or custody to the credit of such taxes such equi- table proportion of the tax, and credit himself with the same in the account required to be rendered by him under this article. If after the payment of any tax in pursuance of an order fixing such tax, made by the surrogate having jurisdic- tion, such order be modified or reversed within two years from and after the date of entry of the order fixing the tax, on due notice to the state comptroller, the state comptroller shall, if such tax was paid in a county in which the office of appraiser is salaried, refund to the executor, administrator, trustee, per- son or persons by whom such tax has been paid, the amount of any moneys paid or deposited on account of such tax in excess of the amount of the tax fixed by the order modified or reversed, out of the funds in his hands or custody to the credit of such taxes, and to credit himself with the same in the account re- quired to be rendered ,by him under this act, or if paid in a county in which the office of appraiser is not salaried, he shall by warrant direct and allow the county treasurer of the county to refund such amount in the same manner; but no application for such refund shall be made after one year from such reversal or modification, and the state comptroller shall deduct from the fees allowed by this article to the county treasurer the amount theretofore allowed him upon such overpayment. Where it shall be proved to the satisfaction of the surrogate that de- 114 THE TAX LAW. ductions for debts were allowed upon the appraisal, since proved to have been erroneously allowed, it shall be lawful for such surrogate to enter an order assessing the tax upon the amount wrongfully or erroneously deducted. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 226. Taxes upon devises and bequests in lieu of commis- sions. If a testator bequeaths or devises property to one or more executors or trustees in lieu of their commissions or allow- ances, or makes them his legatees to an amount exceeding the jommissions or allowances prescribed by law for an executor or trustee, the excess in value of the property so bequeathed or devised, above the amount of commissions or allowances pre- scribed by law in similar cases shall be taxable under this article. (Thus amended l>y L. 1905, chap. 368, in effect June 1, 1905.) 227. Liability of certain corporations to tax. If a foreign executor, administrator or trustee shall assign or transfer any stock or obligations in this state standing in the name of a decedent, or in trust for a decedent, liable to any such tax, the tax shall be paid to the state comptroller or the treasurer of the proper county on the transfer thereof. No safe deposit com- pany, trust company, corporation, bank or other institution, per- son or persons having in possession or under control securities, deposits, or other assets belonging to or standing in the name of a decedent who was a resident or nonresident, or belonging to, or standing in the joint names of such a decedent and one or more persons, including the shares of the capital stock of, or other interests in, the safe deposit company, trust company, corporation, bank or other institution making the delivery or transfer herein provided, shall deliver or transfer the same to the executors, administrators or legal representatives of said de- cedent, or to the survivor or survivors when held in the joint names of a decedent and one or more persons, or upon their order or request, unless notice of the time and place of such intended delivery or transfer be served upon the state comp- troller at least ten days prior to said delivery or transfer; nor shall any such safe deposit company, trust company, corpora- THE TAX LAW. 115 tion, bank or other institution, person or persons deliver or transfer any securities, deposits or other assets belonging to or standing in the name of a decedent, or belonging to, or stand- ing in the joint names of a decedent and one or more persons, including the shares of the capital stock of, or other interests in, the safe deposit company, trust company, corporation, bank or other institution making the delivery or transfer, without retaining a sufficient portion or amount thereof to pay any tax and interest which may thereafter be assessed on account of the delivery or transfer of such securities, deposits or other assets, including the shares of the capital stock of, or other in- terests in, the safe deposit company, trust company, corporation, bank or other institution making the delivery or transfer, under the provisions of this article, unless the state comptroller con- sents thereto in writing. And it shall be lawful for the said state comptroller, personally or by representative, to examine said securities, deposits or assets at the time 'of such delivery or transfer. Failure to serve such notice or failure to allow such examination, or failure to retain a sufficient portion or amount to pay such tax and interest as herein provided shall render said safe deposit .company, trust company, corporation, bank or other institution, person or persons liable to the payment of the amount of the tax and interest due or thereafter to become due upon said securities, deposits or other assets, -including the shares of the capital stock of, or other interests in, the safe de- posit company, trust company, corporation, bank or other insti- tution making the delivery or transfer, and in addition thereto, a penalty of one thousand dollars ; and the payment of such tax and interest thereon, or of the penalty above prescribed, or both, may be enforced in an action brought by the state comptroller in any court of competent jurisdiction. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 228. Jurisdiction of the surrogate. The surrogate's court of every county of the state having jurisdiction to grant letters testamentary or of administration upon the estate of a deced- ent whose property is chargeable with any tax under this article, or to appoint a trustee of such estate or any part thereof, or to give ancillary letters thereon, shall have jurisdiction to hear 116 THE TAX LAW. and determine all questions arising under the provisions of this article, and to do any act in relation thereto authorized by law to be done by a surrogate in other matters or proceedings com- ing within his jurisdiction; and if two or more surrogate's courts shall be entitled to exercise any such jurisdiction, the surrogate first acquiring jurisdiction hereunder shall retain the same to the exclusion of every other surrogate. Every petition for ancillary letters testamentary or ancillary letters of admin- istration made in pursuance of the provisions of article seven, title three, chapter eighteen of the code of civil procedure shall set forth the name of the state comptroller as a person to be cited as herein prescribed, and a true and correct statement of all the decedent's property in this state and the value thereof; and upon the presentation thereof the surrogate shall issue a citation directed to the state comptroller; and upon the return of the citation the surrogate shall determine the amount of the tax which may be or become due under the provisjons of this article and his decree awarding the letters may contain any provision for the payment of such tax or the giving of security therefor which might be made by such surrogate if the state comptroller were a creditor of the decedent. (Thus amended ly L. 1905, chap. 368, in effect June 1, 1905.) 229. Appointment of appraisers, stenographers, et cetera. The state comptroller shall appoint and may at pleasure re- move not to exceed six persons in the county of New York; two persons in the county of Kings, and one person in the counties of Albany, Dutchess, Erie, Monroe, Oneida, Onondaga, Orange, Queens, Eensselaer, Richmond, Suffolk and Westchester, to act as appraisers therein. The appraisers so appointed shall re- ceive an annual salary to be fixed by the state comptroller, to- gether with their actual and necessary traveling expenses and witness fees, as hereinafter provided, payable monthly by the state comptroller out of any funds in his hands or custody on account of transfer tax. The salaries of each of the appraisers so appointed shall not exceed the following amounts: In Xew York county, four thousand dollars; in Kings county, four thousand dollars; in Erie county, three thousand dollars; in Westchester and Albany counties^, twenty-five hundred dollars; THE TAX LAW. 117 in Queens, Monroe and Onondaga counties, one thousand five hundred dollars; in Dutchess, Oneida, Orange, Rensselaer and Suffolk counties, one thousand dollars, and in Richmond county, five hundred dollars. Each of the said appraisers shall file with the state comptroller his oath of office and his official bond in the penal sum of not less than one thousand dollars, in the discretion of the state comptroller, conditioned for the faithful performance of his duties as such appraiser, which bond shall be approved by the attorney-general and the state comptroller. The state comptroller shall retain out of any funds in his hands on account of said tax the following amounts: First. A sum sufficient to provide the appraisers of New York county with five stenographers, of Kings county with two stenographers, and of Erie county with one clerk, appointed by the state comp- troller, whose salary shall not exceed fifteen hundred dollars a year each. Second. A sum to be used in defraying the ex- penses for office rent, stationery, postage, process serving, et cetera, necessarily incurred in the appraisal of estates, not ex- ceeding seven thousand five hundred dollars a year in New York county, and one thousand five hundred dollars a year in Kings county. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905, and L. 1906, chap. 567, talcing effect May 23, 1906.) 230. Proceedings by appraiser. In each county in which the office of appraiser is not salaried the county treasurer shall act as appraiser. The surrogate, either upon his own motion, or upon the application of any interested person, including the state comptroller, shall by order direct the person or one of the persons appointed pursuant to section two hundred and twenty- nine of this article in counties in which the office of appraiser is salaried, and in other counties, the county treasurer, to fix the fair market value of property of persons whose estates shall be subject to the payment of any tax imposed by this article. Every such appraiser shall forthwith give notice by mail to all persons known to have a claim or interest in the property to be appraised, including the state comptroller, and to such per- sons as the surrogate may by order direct, of the time and place when he will appraise such property. He shall at such time and place, appraise the same at its fair market value as herein prescribed; and for that purpose the said appraiser is author- 118 THE TAX LAW. ized to issue subpoenas and to compel the attendance of wit- nesses before him and to take the evidence of such wit- nesses under oath concerning such property and the value thereof; and he shall make report thereof and of such value in writing, to the said surrogate, together with the depositions of the witnesses examined, and such other facts in relation thereto and to said matter as the surrogate may order or require. Every appraiser, except in the counties in which the office of appraiser is salaried, for which provision is hereinbefore made, shall be paid by the state comptroller and after the audit of said state comptroller, his actual and necessary traveling ex- penses and the fees paid such witnesses, which fees shall be the same as those now paid to witnesses subpoenaed to attend in courts of record, payment to be made out of funds in the hands of the county treasurer of the proper county on account of the tax imposed under the provisions of this article. Appraisers appointed under this article in proceedings pending at the time the amendment to this section takes effect shall complete the appraisals therein and file their reports as herein provided, and shall be entitled to the compensation authorized by law at the time of their appointment, to be paid by the state comptroller in counties in which the office of appraiser is salaried, and in other counties by the county treasurer, out of any moneys in his hands on account of this tax. The value of every future or limited estate, income, interest or annuity dependent upon any life or lives in being, shall be determined by the rule, method and standard of mortality and value employed by the superintendent of insurance in ascertain- ing the value of policies of life insurance and annuities for the determination of liabilities of life insurance companies, except that the rate of interest for making such computation shall be five per centum per annum. In estimating the value of any estate or interest in property, to the beneficial enjoyment or possession whereof there are per- sons or corporations presently entitled thereto, no allowance shall be made on account of any contingent incumbrance there on, nor on account of any contingency upon the happening of which the estate or property or some part thereof or interest therein might be abridged, defeated or diminished; provided, THE TAX LAW. 119 however, that in the event of such incumbrance taking effect as an actual burden upon the interest of the beneficiary, or in the event of the abridgment, defeat or diminution of said estate or property or interest therein as aforesaid, a return shall be made to the person properly entitled thereto of a proportionate amount of such tax on account of the incumbrance when taking effect, or so much as will reduce the same to the amount which would have been assessed on account of the actual duration or extent of the estate or interest enjoyed. Such return of tax shall be made in the manner provided by section two hundred and twenty-five of this article. Where any property shall, after the passage of this act, be transferred subject to any charge, estate or interest, determin- able by the death of any person, or at any period ascertainable only by reference to death, the increase accruing to any person or corporation upon the extinction or determination of such charge, estate or interest, shall be deemed a transfer of prop- erty taxable under the provisions of this act in the same manner as though the person or corporation beneficially entitled thereto had then acquired such increase from the person from whom the title to their respective estates or interests is derived. When property is transferred in trust or otherwise, and the rights, interest or estates of the transferees are dependent upon contingencies or conditions whereby they may be wholly or in part created, defeated, extended or abridged, a tax shall be imposed upon said transfer at the highest rate which, on the happening of any of the said contingencies or conditions, would be possible under the provisions of this article, and such tax so imposed shall be due and payable forthwith by the executors or trustees out of the property transferred; provided, however, that on the happening of any contingency whereby the said property, or any part thereof, is transferred to a person or corporation exempt from taxation under the provisions of this article, or to any person taxable at a rate less than the rate im- posed and paid, such person or corporation shall be entitled to a return of so much of the tax imposed and paid as is the differ- ence between the amount paid and the amount which said per- son or corporation should pay under the provisions of this article, with interest thereon at the rate of three per centum 120 THE TAX LAW. per annum from the time of payment. Such return of overpay- ment shall be made in the manner provided by section two hundred and twenty-five of this article. Estates in expectancy which are contingent or defeasible and in which proceedings for the determination of the tax have not been taken or where the taxation thereof has been held in abey- ance, shall be appraised at their full, undiminished value when the persons entitled thereto shall come into the beneficial en- joyment or possession thereof, without diminution for or on account of any valuation theretofore made of the particular estates for purposes of taxation, upon which said estates in ex- pectancy may have been limited. Where r,n estate for life or for years can be divested by the act or omission of the legatee or devisee it shall be taxed as if there were no possibility of such divesting. The report of the appraiser shall be made in duplicate, one of which duplicates shall be filed in the office of the surrogate and the other in the office of the state comptroller. (Thus amended l>y L. 1905, chap. 368, in effect June 1, 1905.) 231. Determination of surrogate. From such report of appraisal and other proof relating to any such estate before the surrogate, the surrogate shall forthwith, as of course, determine the cash value of all estates and the amount of tax to which the same are liable ; or the surrogate may so determine the cash value of all such estates and the amount of tax to which the same are liable, without appointing an appraiser. The superintendent of insurance shall, on the application of any surrogate, determine the value of any such future or con- tingent estates, income or interest therein limited, contingent, dependent or determinable upon the life or lives of persons in being, upon the facts contained in any such appraiser's report, and certify the same to the surrogate, and his certificate shall be conclusive evidence that the method of computation adopted therein is correct. The surrogate shall immediately give notice, upon the deter- mination by him as to the value of any estate which is taxable under this article, and of the tax to which it is liable, to all persons known to be interested therein, and shall immediately THE TAX LAW. 121 forward a copy of such taxing order to the state comptroller. The surrogate shall also forward to the state comptroller copies of all orders entered by him in relation to or affecting in any way the transfer tax on any estate, including orders of ex- emption. If, however, it appear at any stage of the proceedings that any of such persons known to be interested in the estate is an infant or an incompetent, the surrogate may, if the interest of such infant or incompetent is presently involved and is ad- verse to that of any of the other persons interested therein, appoint a special guardian of such infant; but nothing in this provision shall affect the right of an infant over fourteen years of age or of any one on behalf of an infant under fourteen years of age to nominate and apply for the appointment of a special guardian for such infant at any stage of the proceedings. (Thus amended by L. 1905, chap. 368, in effect June 1, 1005.) 232. Appeal and other proceedings. The state comptrol- ler or any person dissatisfied with the appraisement or assess- ment and determination of tax may appeal therefrom to the surrogate within sixty days from the fixing, assessing and de- termination of tax by the surrogate as herein provided, upon filing in the office of the surrogate a written notice of appeal, which shall state the grounds upon which the appeal is taken. Within two years after the entry of an order or decree of a surrogate determining the value of an estate and assessing the tax thereon, the state comptroller may, if he believes that such appraisal, assessment or determination has been fraudulently, collusively, or erroneously made, make application to a justice of the supreme court of the judicial district in which the former owner of such estate resided, for a reappraisal thereof. The justice to whom such application is made may thereupon ap- point a competent person to reappraise such estate. Such appraiser shall possess the powers and be subject to the duties of an appraiser under section two hundred and thirty and shall receive compensation at the rate of five dollars per day for every day actually and necessarily employed in such appraisal. Such compensation shall be payable by the state comptroller or county 122 THE TAX LAW. treasurer out of any funds he may have on account of any tax imposed under the provisions of this article, upon the certificate of the justice appointing him. The report of such appraiser shall be filed with the justice by whom he was appointed, and thereafter the same proceedings shall be taken and had by and before such justice as are herein provided to be taken and had by and before the surrogate. The determination and assessment of such justice shall supersede the determination and assess- ment of the surrogate, and shall be filed by such justice in the office of the state comptroller, and a certified copy thereof trans- mitted to the surrogate's court of the proper county. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 233. Composition of transfer tax upon certain estates. The state comptroller, by and with the consent of the attorney- general expressed in writing, is hereby empowered and author- ized to enter into an agreement with the trustees of any estate in which remainders or expectant estates have been of such A nature, or so disposed and circumstanced that the taxes therein were held not presently payable, or where the interests of the legatees or devisees were not ascertainable under the provisions of chapter four hundred and eighty-three of the laws of eighteen hundred arid eighty-five; chapter three hundred and ninety- nine of the laws of eighteen hundred and ninety-two, or chapter nine hundred and eight of the laws of eighteen hundred and ninety-six, and the several acts amendatory thereof and supple- mental thereto; and to compound such taxes upon such terms as may be deemed equitable and expedient ; and to grant dis- charge to said trustees upon the payment of the taxes provided for in such composition, provided, however, that no such com- position shall be conclusive in favor of said trustees as agjiinsi. the interests of such cestuis que trust as may possess either present rights of enjoyment, or fixed, absolute or indefeasible rights of future enjoyment, or of such as would possess such rights in the event of the immediate termination of particular estates, unless they consent thereto, either personally, when competent, or by guardian or committee. Composition or settlement made or effected under the provisions of this section THE TAX LAW. 123 shall be executed in triplicate, and one copy filed in the office of the state comptroller, one copy in the office of the surrogate of the county in which the tax was paid, and one copy delivered to the executors, administrators or trustees who shall be parties thereto. (Thus amended by the L. 1905, chap. 368, in effect June 1, 1905.) 234. Surrogate's assistants in New York, Kings and other counties. The state comptroller may, upon the recommenda- tion of the surrogate, appoint, and may at pleasure remove assistants and clerks in the surrogate's offices of the following counties, at annual salaries to be fixed by him not to exceed the amounts hereinafter specified: 1. In New York county, a transfer tax assistant, four thou- sand dollars; a transfer tax clerk, two thousand four hundred dollars; an assistant clerk, eighteen hundred dollars; a record- ing clerk, thirteen hundred dollars; a stenographer, eight hun- dred dollars; and shall be entitled to expend not more than five hundred dollars a year in such office for expenses neces- sarily incurred in the assessment and collection of taxes under this article. 2. In Kings county, a transfer tax assistant, four thousand dollars ; a transfer tax clerk, two thousand dollars ; an assistant clerk, fifteen hundred dollars; and shall be entitled to expend not more than five hundred dollars a year for expenses neces- sarily incurred in the assessment and collection of taxes under this article. 3. In Erie county, a transfer tax clerk, eighteen hundred dollars. 4. In Westchester county, a transfer tax assistant, two thou- sand five hundred dollars. (Thus amended by L. 1906, chap. 699, taking effect June 2, 1906.) 5. In Albany county, a transfer tax clerk, one thousand dol- lars. 124 THE TAX LAW. 6. In Queens county, a transfer tax clerk, one thousand dollars. 7. In Onondaga county, a transfer tax clerk, twelve hundred dollars. 8. In Monroe county, two transfer tax clerks, seven hundred and fifty dollars each ; and shall be entitled to expend not more than two hundred dollars a year for expenses necessarily in- curred in the assessment and collection of taxes under this article. 9. In Dutchess county, a transfer tax clerk, nine hundred dollars. 10. In Oneida county, not more than two transfer tax clerks, twelve hundred dollars in the aggregate. 11. In Suffolk county, a transfer tax clerk, one thousand dollars. 12. In Ulster county, a transfer tax clerk, seven hundred and twenty dollars. Such salaries and expenses shall be paid monthly by the state comptroller, upon proper vouchers, out of any funds in his hands on account of taxes collected under this article. (Thus amended ~by L. 1905, chap. 368, in effect June 1, 1905.) 235. Proceedings by district attorneys. If, after the ex- piration of eighteen months from the accrual of any tax under this article, such tax shall remain due and unpaid, after the refusal or neglect of the persons liable therefor to pay the same, the state comptroller shall notify the district attorney of the county, in writing, of such failure or neglect, and such district attorney shall apply to the surrogate's court for a cita- tion, citing the persons liable to pay such tax to appear before the court on the day specified, not more than three months after the date of such citation, and shov oause why the tax should THE TAX LAW. 125 not be paid. The surrogate, upon such application, and when- ever it shall appear to him that any such tax accruing under this article has not been paid as required by law, shall issue such citation and the service of such citation, and the time, manner and proof thereof, and the hearing and determination thereon and the enforcement of the determination or order made by the surrogate shall conform to the provisions of the code of civil procedure for the service of citations out of the surrogate's court, and the hearing and determination thereon and its enforcement so far as the same may be applicable. The surrogate or his clerk shall, upon request of the district attorney or the state comptroller, furnish, without fee, one or more tran- scripts of such decree, which shall be docketed and filed by the county clerk of any county of the state without fee, in the same manner and with the same effect as provided by law for filing and docketing transcripts of decrees of the surrogate's court. The cost awarded by any such decree after the collection and payment of the tax to the state comptroller or county treasurer may be retained by the district attorney for his own use. Such costs shall be fixed by the surrogate in his discretion, but shall not exceed in any case where there has not been a contest, the sum of one hundred dollars, or where there has been a contest the sum of two hundred and fifty dollars. Whenever the sur- rogate shall certify that there was probable cause for issuing a citation and taking the proceedings specified in this section, the state comptroller, after the same shall have been audited by him, shall pay all expenses incurred for the service of cita- tions and other lawful disbursements not otherwise paid, from funds in his hands on account of such tax, or in a county in which the office of appraiser is not salaried, by a warrant upon the county treasurer of such county for the payment by him of the same from funds in his hands on account of such tax. In proceedings to which the state comptroller is cited as a party under sections two hundred and twenty-nine and two hundred and thirty of this article, he is authorized to designate and retain counsel to represent him and to pay the expenses thereby incurred out of the funds which may be in his hands on account of this tax in any case in a countjr where the office of appraiser is salaried, and in any other county the state comp- 126 THE TAX LAW. troller shall by warrant direct the county treasurer to pay such expenses out of any funds which may be in his hands on account of this tax; provided, however, that in the collection of taxes upon estates of non-resident decedents the state comptroller shall not allow for legal services up to and including the entry of the order of the surrogate fixing the tax a sum exceeding ten per centum of the taxes and penalties collected. (Thus amended ~by the L. 1905, chap. 368, in effect June 1, 1905.) 236. Receipts from county treasurer or comptroller. One of the duplicate receipts issued for the payment of any tax under this article, as provided by section two hundred and twenty-two, shall be countersigned by the state treasurer if the same was issued by the state comptroller, and by the state comp- troller if issued by any county treasurer. The officer so count- ersigning the same shall charge the officer receiving the tax with the amount thereof and affix the seal of his office to the same and return to the proper person; but no executor, ad- ministrator or trustee shall be entitled to a final accounting of an estate in settlement of which a tax is due under the pro- visions of this article unless he shall produce a receipt so sealed and countersigned, or a certified copy thereof. Any person shall, upon the payment of fifty cents to the officer issuing such receipt, be entitled to a duplicate thereof, to be signed, sealed and countersigned in the same manner as the original. Any person shall, upon the payment of fifty cents, be en- titled to a certificate of the state comptroller that the tax upon the transfer of any real estate of which any decedent died seized has been paid, such certificate to designate the real prop- erty upon which such tax is paid, the name of the person so paying the same, and whether in full of such tax. Such certi- ficate may be recorded in the office of the county clerk or register of the county where such real property is situate, in a book to be kept by him for that purpose, which shall be labeled "transfer tax." (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 237. Fees of county treasurer. The treasurer of each county in which the .office of appraiser is not salaried shall be THE TAX LAW. 127 allowed to retain on all taxes paid and accounted for by him each fiscal year under this article, five per centum on the first fifty thousand dollars, three per centum on the next fifty thou- sand dollars, and one per centum on all additional sums. Such fees shall be in addition to the salaries and fees now allowed by law to such officers. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 238. Books and forms to be furnished by the state comp- troller. The state comptroller shall furnish to each surrogate, a book, which shall be a public record, and in which he shall enter the name of every decedent upon whose estate an applica- tion to him has been made for the issue of letters of administra- tion, or letters testamentary, or ancillary letters, the date and place of death of such decedent, the estimated value of his real and personal property, the names, places 'of residence and re- lationship to him of his heirs-at-law, the names and places of residence of the legatees and devisees in any will of any such decedent, the amount of each legacy and the estimated value of any real property devised therein, and to whom devised. These entries shall be made from the data contained in the papers filed on any such application, or in any proceeding re- lating to the estate of the decedent. The surrogate shall also enter in such book the amount of the personal property of any such . decedent, as shown by the inventory thereof when made and filed in his office, and the returns made by any appraiser appointed by him under this article, and the value of annuities, life estates, terms of years, and other property of any such de- cedent or given by him in his will or otherwise, as fixed by the surrogate, and the tax assessed thereon, and the amounts of any receipts for payment of any tax on the estate of such decedent under this article filed with him. The state comp- troller shall also furnish to each surrogate forms for the reports to be made by such surrogate, which shall correspond with the entries to be made in such book. (Thus amended by L. 1905, ch. 368, in effect June 1, 1905.) 239. Reports of surrogate and county clerk. Each surro- gate shall, on January, April, July and October first of each 128 THE TAX LAW. year make a report, upon the forms furnished by the comp- troller containing all the data and matters required to be en- tered in such book, which shall be immediately forwarded to the state comptroller. The county clerk of each county, except in the counties where the registers perform the duties of the county clerk with respect to the recording of deeds, and when in such counties the registers, shall, at the same times, make reports containing a statement of any deed or other conveyance filed or recorded in his office, of any property, which appears to have been made or intended to take effect in possession or enjoyment after the death of the grantor or vendor, with the name and place of residence of such grantor or vendor, the name and place of residence of the grantee or vendee, and a description of the property transferred, which shall be immediately forwarded to the state comptroller. (Thus amended ~by L. 1905, chap. 368, in effect June 1, 1905.) 240. Reports of county treasurer. Each county treasurer in a county in which the office of appraiser is not salaried shall make a report, under oath, to the state comptroller, on January, April, July and October first of each -year, of all taxes received by him under this article, stating for what estate and by whom and when paid. The form of such report may be prescribed by the state comptroller. He shall, at the same time, pay the state treasurer all taxes received by him under this article and not previously paid into the state treasury, and for all such taxes collected by him and not paid into the state treasury within thirty days from the times herein required, he shall pay interest at the rate of ten per centum per annum. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 240-a. Report of state comptroller; payment of taxes. The state comptroller shall deposit all taxes collected by him under this article in a responsible bank, banking house or trust company in the city of Albany, which shall pay the highest rate of interest to the state for such deposit, to the credit of the state comptroller on account of the transfer tax. And every such bank, banking house or trust company, shall execute and file in his office an undertaking to the state, in the sum, and with such THE TAX LAW. sureties, as are required and approved by the comptroller, for the safe keeping and prompt payment on legal demand therefor of all such moneys held by or on deposit in such bank, banking house or trust company, with interest thereon on daily balances- at such rate as the comptroller may fix. Every such under- taking shall have endorsed thereon, or annexed thereto, the approval of the attorney general as to its form. The state comptroller shall on the first day of each month make a verified return to the state treasurer of all taxes received by him under this article, stating for what estate, and by whom and when paid ; and shall credit himself with all expenditures made since his last previous return on account of such taxes, for salary, re- funds, or other purposes lawfully chargeable thereto. He shall on or before the tenth day of each month pay to the state treas- urer the balance of such taxes remaining in his hands at the close of business on the last day of the- previous month, as ap- pears from such returns. (Added by L. 1901, chap. 173, and- amended by L. 1905, chap. 368, in effect June 1, 1905, and L 1906, chap. Ill, taking effect March 28, 1906.) 241. Application of taxes. All taxes levied and collated under this article when paid into the treasury of the state shall be applicable to the expenses of the state government and to such other purposes as the legislature shall by law direct. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 242. Definitions. The words " estate " and " property," a& used in this article, shall be taken to mean the property or in- terest therein of the testator, intestate, grantor, bargainer or vendor, passing or transferred to those not herein specifically exempted from the provisions of this article, and not as the property or interest therein passing or transferred to individual . legatees, devisees, heirs, next of kin, grantees, donees or vendees,, and shall include all property or interest therein, whether sit- uated within or without this state. The word " transfer," as used in this article, shall be taken to include the passing of prop- erty or any interest therein in possession or enjoyment, present or future, by inheritance, descent, devise, bequest, grant, deed, bargain, sale or gift, in the manner herein prescribed. The vords " county treasure/ 1 " and " district attorney," as used in 130 THE TAX LAW. this article, shall be taken to mean the treasurer or the district attorney of the county of the surrogate having jurisdiction as provided in section two hundred and twenty-eight of this article. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) 243. Exemptions in article one not applicable. The ex- emptions enumerated in section four of the tax law, of which this article is a part, shall not be construed as being applicable in any manner to the provisions of article ten hereof. (Thus amended by L. 1905, chap. 368, in effect June 1, 1905.) L. 1901, chap. 173, 17. Repeal. Chapter eight hundred and sixty- one of the laws of eighteen hundred and ninety-five; chapters nine hundred and fifty-two and nine hundred and fifty-three of the laws of eighteen hundred and ninety-six, chapter three hundred and seventy- five of the laws of eighteen hundred and ninety-seven; and chapters two hundred and sixty-nine, two hundred and seventy and four hun- dred and six of the laws of eighteen hundred and ninety-nine, and chapter three hundred and seventy-nine of the laws of nineteen hundred, are hereby repealed. L. 1901, chap. 173, 18. Taking effect. This act shall take effect April first, nineteen hundred and one, except that salaried appraisers for the counties of Albany, Suffolk, Westchester, Dutchess, Monroe, Oneida, Onondaga, Orange and Rensselaer shall not be appointed before January first, nineteen hundred and two, and until such time such counties shall be deemed counties in which the office of appraiser is not swlaried under the provisions of this act. (Thus amended by L. 1001, chap. 288, taking effect April 5, 1901.) THE TAX LAW. 131 ARTICLE XL PROCEDURE. Section 250. Contents of petition. 251. Allowance of writ of certiorari. 252. Return of writ. 253. Proceeding upon return. 254. Costs. 255. Appeals. 256. Refund of tax paid upon illegal, erroneous or unequal assessment. 257. When county court may apportion tax. 258. Application to county court where taxpayer has removed from the county. 259. Supplementary proceedings to collect a tax. 259a. Dismissal of suits or proceedings. 260. Power of county court when collector fails to pay over. 261. Payment of moneys collected. 262. Collection of deficiency from collector's bondsmen. 263. Attorney-general to bring action for sequestration. 264. Settlement of conflicting claims to surplus of tax sale. f 250. Contents of petition. Any person assessed upon any assessment-roll, claiming to be aggrieved by any assess- ment for property therein, may present to the supreme court a petition duly verified setting forth that the assessment is illegal, specifying the grounds of the alleged illegality, or if erroneous by reason of overvaluation, stating the extent of such overvaluation, or if unequal in that the assessment has been made at a higher proportionate valuation than the assessment of other property on the same roll by the same officers, specifying the instances in which such inequality exists, and the extent thereof, and stating that he is or will be Injured thereby. Such petition must show that applica- tion has been made in due time to the proper officers to cor- rect such assessment. Two or more persons assessed upon the same roll who are affected in the same manner by the alleged illegality, error or inequality, may unite in the same petition. " 251. Allowance of writ of certiorari. Such petition must be presented to a justice of the supreme court or at a special 132 THE TAX LAW. i term of the supreme court in the judicial district in which the assessment complained of was made, within fifteen days after the completion and filing of the assessment-roll and the first posting or publication of the notice thereof as re- quired by this chapter. Upon the presentation of such pe- tition, the justice or court may allow a writ of certiorari to the officers making the assessment, to review such assessment, and shall prescribe therein the time within which a return thereto must be made and served upon the relator's attor- ney, which shall not be less than ten days, and may be ex- tended by the court or a justice thereof. Such writ shall be returnable to a special term of the supreme court of the judicial district in which the assessment complained of was made. The allowance of the writ shall not stay the pro- ceedings of the assessors or other persons to whom it is di- rected or to whom the assessment is delivered, to be acted upon according to law. 252. Return to writ The officers making a return to stlch writ shall not be required to return the original assess- ment-roll or other original papers acted upon by them, but it shall be sufficient to return certified or sworn copies of such roll or papers, or of such portions thereof as may be called for by such writ. The return must concisely set forth such other facts as may be pertinent and material to show the value of the property assessed on the roll and the ground for the valuation made by the assessing officers and the re- turn must be verified. 253. Proceedings upon return. If it shall appear upon the return to any such writ that the assessment complained of is illegal or erroneous or unequal for any of the reasons alleged in the petition, the court may order such assessment, if legal, to be stricken from the roll, or if erroneous or un- equal, it may order a re-assessment of the property of tha petitioner, or the correction of his assessment upon the roll, in whole or in part, in such maner as shall be in accordance with law, or as shall make it conform to the valuations and assessments of other property upon the same roll and secure equality of assessment. If upon the hearing it shall appear to the court, that testimony is necessary for the proper dis- TUB TAX LAW. 133 position of the matter, it may take evidence or may appoint a referee to take such evidence as it may direct, and report the same to the court, with his findings of fact and conclu- sions of law, which shall constitute a part of the proceedings upon which the determination of the court shall be made. A new assessment or correction of an assessment made by order of the court shall have the same force and effect as if it had been so made by the proper officers within the time prescribed by law for making such assessment. 254. Costs. Costs shall not be allowed against the officers whose proceedings may be reviewed under any such writ unless it shall ap- pear to the court, that they acted with gross negligence or in bad faith or with malice in making the assessment complained of. If the writ shall be quashed or the assessment confirmed, or if the n iir 1891 211 , AIL 1891 218 , , AH. 1892 196 AIL 1892 202 L incln- 156 THE TAX LAW. SCHEDULE OF LAWS REPEALED (Continued). Laws of Chapter. Sectioi 1892 266 AIL 1892 347 AIL 1892 399 AIL 1892 463 , AIL 1892 477.... AIL 1892 529 AIL 1892 , 565 , AIL 1892 661 AIL 1892 668 AIL 1892 713 , AIL 1892 714 AIL 1893 199 , AIL 1893 498 AIL 1893 525 , AIL 1893 ... 704 , AIL 1893 ,.... 711 , AIL 1894 , 196 , AIL 1894 312 AIL 1894 , 562 , AIL 1894 , 713 , , AIL 1895 , 378 , AIL 1895 , 418 , , AIL 1895 , 425 , AIL 1895 , 515 , AIL 1895 , , 556 , , AIL 1895 , , 558 , AIL 1895 , 608 , , AIL 1895 895 , AIL naileries, Game INDEX. ACTION : Page against delinquent corporation 105 for sequestration against delinquent corporation 137 tax, limitation of time not applicable 140 ADMINISTRATORS : personal property in possession of, where taxed 10, 11 assessment of 24 tax on transfers, payment 112 collection 112 foreign, to pay transfer tax on transfer of securities 114 AGENTS : personal property in possession of, where taxed 11 assessment of 24 AGRICULTURAL SOCIETIES : exemption of real property 8 APPEALS : to tax commissioners, from equalization of boards of super- visors 86 how brought 86 how conducted 87 determination of 87 costs 87 from valuation of taxable transfer appraisers 121 from order in proceedings to review assessment 133 APPORTIONMENT: of tax on premises wrongfully assessed with other premises . . . 134 APPRAISAL: of values of estates subject to transfer 117, 118 of contingent estates 119 life estates, remainder or reversion 118 report of appraisers 120 APPRAISERS, TAXABLE TRANSFER: to be appointed by comptroller in certain counties 116 salaries 116, 117 county treasurers to act as 117 proceedings by 117 report of, to surrogate 120 appeal from determination of 121 158 IXDEX. ARREARS : rage, of taxes on lands of non-residents 57 ASSESSMENT: of land sold or leased by the state 10 of personal property, deduction when not allowed 10 ascertaining facts for 14 of property to " estate " of decedent, valid 16 state lands in forest preserve 1(5 bank stock, value of shares 17 of capital of individual banker 20 notice of, to banks 21 non-resident real property 22 of corporations on assessment-roll 23 of agent, trustee, guardian or executor 24 omitted property 24 debts due non-residents of United States 24 complaints as to, hearing and determination 25 of special franchises, when to be filed 29 hearing before tax commissioners 32 certiorari to review 33 illegally made, reassessment by board of supervisors 38 procedure for review of 131 writ of certiorari, petition 131 when allowed 131, 132 return to 132 proceedings upon return 132 costs 133 appeals from order 133 illegal, erroneous, or unequal, refund of tax 133 correction of, by board of supervisors 134 ASSESSMENT-ROLL : to contain six columns 15 corporations, how assessed on 23 completion, notice of 25 correction and verification of 26 notice of filing completed 27 delivery of, to supervisor 27 special franchise, valuations to be entered in 30 correction of errors in, by boards of supervisors 37 ASSESSORS: determination of residence 11 to ascertain facts for assessment 14 forest preserve, duties as to state lands in 16 banks, list of stockholders inspected by 17 to hear and determine complaints 25 may administer oaths and take testimony 26 INDEX. 159 ASSESSORS Continued : Pag e. correction and verification of tax-roll 26 notice of filing assessment-roll 27 delivery of assessment-roll to supervisor 27 apportionment of valuation of railroad, telegraph, etc., com- panies between school districts 27 to follow forms and obey instructions of tax commissioners . . 28. neglect or omission of duty 28 special franchises, statements of valuations to be delivered to. 30 valuations to be entered in assessment-roll 30 apportionment between school districts 31 tax commissioners to furnish information to 84 BAGGAGE EXPRESS CORPORATIONS: franchise tax on earnings 93 BANKER, INDIVIDUAL: capital, where to be taxed 13 assessment, how made 20 BANKERS, FOREIGN: tax upon 97 when due 102 reports of 98 BANKING CORPORATIONS: not to pay organization tax 90 foreign, not to pay license tax 90 tax upon capital 97 not subject to tax on capital stock 92 tax, when to be paid 102 BANKS : stockholders, how taxed 13 statements to be furnished assessors by 17 penalty for neglect to furnish 17 list of stockholders, open to inspection of assessors 17 shares, value of, how ascertained 17 rate of tax upon 18 levy and collection of tax upon 18, 19 collection to be made by county treasurer 20 notice of assessment to 21 collection of taxes assessed upon stock 44 tax on transfer of securities of decedent 114 transfer tax, deposit in 129 undertaking to be given 129 BENEVOLENT CORPORATIONS: axemption of real property 7 160 INDEX. BEQUEST: Page, to executor or trustee, tax upon 114 BOARD OF SUPERVISORS: duties of, as to taxation of banks 19, 20 in Nassau county, as to lands sold to county 36 equalization of valuations by 36 non-resident real property, description may be changed 36 owners of rents reserved, review of assessment 37 correction of errors by 37 reassessment of property illegally assessed 38 levy of tax by 39 warrant for collection of taxes 39 correction of illegal assessments 134 duties as to mortgage tax 147 BOND: of collector, satisfaction of 52 of recording officers, county treasurers and chamberlain 148 BONDS : issued by state or municipal corporation, exemption 7 BOOKS: taxable transfer, to be furnished by comptroller 127 entries in, by surrogate 127 BRIDGES : land includes 4 BUILDING AND LOAN ASSOCIATIONS: not to pay organization tax 90 foreign, not to pay license tax 90 CANAL CORPORATIONS: franchise tax on earnings 93 CANCELLATION: of taxes by comptroller 57 returns of, to board of supervisors 58 of sale of lands for unpaid taxes 76 when set aside 76 CAPITAL STOCK: taxation of 13 CEMETERY CORPORATIONS: exemption of real property 7 INDEX. 161 CERTIFICATES OF INCORPORATION: Page . secretary of state to report to comptroller 106 CERTIFICATES OF SALE. on purchases of land for unpaid taxes, for state or county.. 63, 64 to purchaser 66 new, when sale is set aside 65, 66 evidence of loss of 70 CERTIORARI: to review assessment of special franchise 33 corporation tax, review of determination as to 103 regulations as to writ 104 petition for writ of, to review assessment 131 contents of 131 presented to justice of supreme court or at special term. . 131 return to writ of 132 proceedings upon 132 costs in proceedings 133 appeals from order 133 CHARITABLE CORPORATIONS: exemption of real property 7 CLERGYMEN: exemption of dwelling-houses of 8 of property belonging to 9 CLERK OF BOARD OF SUPERVISORS: statement of corporate taxes to be delivered to county treas- urer 40 of valuation to be delivered to comptroller 40 COLLATERAL INHERITANCES: tax upon (see Taxable Transfers) 108 COLLECTION: of tax on bank shares 19, 20 of taxes, by sale of personal property 43 assessed against bank stock 44 against telegraph, telephone and electric light companies. 45 on rents reserved 45 of unpaid taxes on debts due non-residents of United States . . 46 return of -warrant for 46 extension of time for of tax against corporations, warrant 1 of transfer tax, proceedings for 1 of tax on person who has removed from county 135 supplementary proceedings for 135 162 INDEX. COLLECTORS: Page- warrant for collection of taxes, contents 39 abstract to be furnished county treasurer 41 notice of time of receiving taxes 42 non-resident may demand statement of amount of tax 43 collection of taxes by 43 against banks 44 on rents reserved 45 levy upon personal property, for failure to pay tax 43 tax on part of lot of land, receipt of 47 fees of 48 return of unpaid taxes 48 payment of money collected 50 of surplus collected 50 extension of time for collection 50 vacancy, how filled 51 warrant, when executed by sheriff 51 bond, satisfaction of 52 losses by default 55 receipts for taxes 55 failure to pay tax collected, order of county court 136 sheriff to collect amount 136 payment over, of amount collected 137 liability of bondsmen for deficiency 137 COLLECTOR'S WARRANT: to be annexed to tax-roll, contents 39 abstract to be furnished county treasurer 41 COMPLAINTS : as to assessments, hearing and determination 25 statement to be filed 25 COMPLETION: of assessment-roll, notice of 25 what to contain, and how posted 25 COMPOSITION: of tax on transfer 122 COMPTROLLER: duties of, in respect to assessment of state lands in forest preserve 16 borrow money, at expense of county, if state tax is not paid . . 54 accounts with county treasurer 54 direct proceedings against county treasurer 54 non-resident taxes, admission of 57 payment to county treasurer of arrears of taxes on lands of non-residents . . 57 INDEX. 163 COMPTROLLER Continued : Page. cancellation of taxes 57 return of, to board of supervisors 58 refund of overcharges 60 notice of sale of lands for unpaid taxes 61 publication 63 sale of lands for unpaid taxes, how conducted 63 purchases for state or county 63 deed of lands 69 effect of former 70 appointment of taxable transfer appraisers 116 receipt of payment of transfer tax 126 taxable transfer books and forms, furnished by 128 duties relative to apportionment of mortgage tax where mort- gaged premises are situated in this and another state.. 144, 145 duty, upon receipt of taxes on mortgages 146 supervisory power over county treasurers 148 stock transfer tax, duties as to stamps 151 enforcement of collection (see Stock Transfers) 152 CONTINGENT ESTATES : appraisal of value, for tax on transfer 119- CONTRACTS : for sale of land, deemed mortgages for taxation 141 CORPORATIONS: exemption of real property of certain 7 stockholders not to be taxed on stock 10- place of taxation of property of 12 capital stock of, taxation of 13 reports of, to assessors 21 penalty for failure to make 21 county clerks to furnish data respecting 22- assessments on assessment-roll 23 statement of taxes, clerk of board of supervisors to deliver to county treasurer 40 organization tax 89 not to apply to banks and loan associations 90 on railroads 90 foreign, license tax 90 franchise tax 91 computed on dividends 91 not subject to tax on capital stock 92 additional franchise tax on transportation 93 railroads, not operated by steam 94 insurance, franchise tax on 95 164 INDEX. CORPORATIONS Continued : Pag e. reports of, liable to tax 98 contents of, and how made 100 value of stock to be appraised 100 comptroller may investigate 100 notice of statement 101 payment of tax upon 102 readjustment of tax, by comptroller 103 review of determination of comptroller 103 collection of tax, warrant for 104 delinquent, information as to 105 employment of persons to assist in collection of tax from. 105 certificates of incorporation, report by secretary of state 106 exemptions from taxation for other purposes 106 application of taxes 107 action for sequestration against delinquent 137 CORPORATION TAX. (See Corporations; Franchise Tax; Or- ganization Tax, etc., etc.) CORRECTION: of assessment-roll '. 26 of errors in assessment-roll, by board of supervisors 37 of descriptions of lands 58 COSTS : on appeals to tax commissioners 87 in proceedings for review of assessment 133 COUNTY: purchase of lands sold for unpaid taxes 63 COUNTY CLERK: to furnish data respecting corporations 22 reports of deeds, etc., to comptroller 127, 128 duties as to mortgage tax (see Recording Officers) 141-149 COUNTY COURT: apportionment of tax 134 order for collection of tax of person who has removed from county 135 when collector fails to pay over tax 136 COUNTY TREASURER: collection of tax on bank shares 19, 20 agents of non-residents of United States to make statement to. 24 railroad and electric corporations to pay taxes to 44 warrant to sheriff, for collection of taxes on debts due non- residents 46 payment to creditors of county 53 of state tax . 53 INDEX. 165 COUNTY TREASURER Continued: Page. fees of, to be retained 53 accounts with comptroller 54 proceedings against, comptroller may direct supervisors to begin 54 losses by default 54, 55 return of unpaid non-resident taxes to comptroller in certain counties *. 56 sale of lands for unpaid taxes 79 notice and advertisement 79 conveyance by 81 effect of 81 provisions applicable to comptroller apply to 82 tax on transfers to be paid to Ill receipt of payment to be given 126 appraiser of taxable transfers 117 fees of, on account of transfer tax 126, 127 reports of, to comptroller 128 mortgage tax payable to 146 distribution, how made 146-148 expenses to be paid 146, 148 subject to supervisory power of comptroller 148 bond, amount and approval 148 CREDITORS : of county, payments by county treasurer 53 CROSSINGS: of streets, when not deemed special franchise 5 DEBTS : due non-residents of United States, how assessed 24 collection of unpaid taxes upon 46 DEDUCTION: in assessment of personal property, when not allowed 10 from special franchise tax 33 DEED: comptroller's, for lands sold for unpaid taxes 69 cancellation of, by payment of taxes 70 evidence of, when conclusive 70 DEFINITIONS : tax district county treasurer land, real estate, real property 4, 141 special franchise *> personal estate, personal property 5 166 INDEX. DEFINITIONS Continued : Page. occupant, occupancy 71 premiums, gross premiums 96 estate, property 129 transfer 129 county treasurer, district attorney 129 mortgage of real property 141 executory contracts for sale of land 141 DELINQUENT: corporation, information as to 105 forfeiture of charter 105 DESCRIPTIONS : imperfect, correction of 58 supervisor to cause map or survey to be made 58 DESPOLIATION: of lands sold for unpaid taxes, prohibited 68 liability for, to holder of tax certificate 68 DEVISES: to executor or trustee, tax upon 115 EDUCATIONAL CORPORATIONS: exemption of real property ... 7 ELECTRIC LIGHT COMPANY: payment of taxes by 44 enforcement of 45 ELECTRIC LIGHTING, HEATING AND POWER COMPANIES: franchise tax on 94 reports of 98 EQUALIZATION: of valuations of tax districts 36 appeals to tax commissioners 86 how brought 86 how conducted 87 determination of 87 costs 87 EQUALIZATION, STATE BOARD OF: how constituted 85 powers and duties 86 ERRORS: correction of, by board of supervisors 37 upon petition of assessors 37 ESTATE: of decedent, assessment to 16 INDEX. 167 EXECUTION: * k*gc. property exempt from, not to be taxed 6 EXECUTORS : personal property in possession of, where taxed 10, 11 assessment of 24 tax on transfers, payment 112 collection of 112 on devises or bequests in lieu of commissions 114 foreign, to pay transfer tax on transfer of securities 114 EXECUTORY CONTRACTS: deemed mortgages for purposes of taxation 141 EXEMPTIONS: from taxation 6 report of, to state tax commissioners 1 3a of corporations, from state tax on personal property 106 from tax on transfers 110 not applicable to taxable transfers 130 of mortgages from local taxation 141, 142 from mortgage tax 142 EXPECTANCY, ESTATES IN: appraisal of value, for tax on transfer 120 EXPRESS COMPANIES: franchise tax on earnings 93 EXTENSION: of time for collection of taxes 50 renewal of collector's bond upon 50 FARM LANDS: divided by line of tax district, where taxed 12 FEES: of collector 48 of county treasurer . . .' 53 on account of transfer tax 126, 127 FERRY CORPORATIONS: franchise tax on earnings , 93 FIREMEN'S ASSOCIATIONS: exemption of real property 8 FOREIGN BANKERS : tax upon 97 when due 102 reports of 99 1G8 IXDEX. FOREIGN CORPORATIONS: Page. license tax 90 franchise tax, on capital employed within state 91 FOREST PRESERVE : state property in, subject to taxation 6 assessment of state lands in 16 payment of taxes on state lands in 48 FORMS : taxable transfer to be furnished by comptroller 127 under mortgage tax article. (See Mortgages, Taxation of.) FRANCHISES. (See Special Franchise.)- to use streets, included as lands 4 FRANCHISE TAX: on corporations, how computed 91 foreign corporations 91 certain corporations not to pay 93 additional, on transportation corporations 03 on elevated or railroads not operated by steam 94 water-works, gas, electric and steam companies 94 insurance companies 95 computed on premiums 95 trust companies 96 how computed 96, 97 savings banks 97 reports of corporations paying 98 contents and how made 100 when to be paid 102 GAS COMPANIES: franchise tax on 94 reports of 98 GRIEVANCE-DAY: for hearing complaints as to assessments 25 GRIEVANCES : day for hearing 25 neglect to meet for hearing 28 GROSS PREMIUMS: definition of 06 GUARDIANS: personal property in possession, where taxed 10, 11 assessment of 24 INDEX. 169 HIGHWAYS : Pagf . franchises to use, included as lands 4 crossings, when not deemed special franchise 5 HISTORICAL SOCIETIES: exemption of real property 7 HOMESTEAD : exempt, to be taxed 6 exemption of real property 7 INDIANS: lands, exempt from taxation 6 INDIVIDUAL BANKER: place of taxation of 13 assessment of, how made 20 INFIRMARY CORPORATIONS: exemptions of real property 7 INSURANCE CORPORATIONS: personal property, when exempt 9 upon co-operative or assessment plan, exemptions of moneys of 9 foreign, not to pay license tax 90 not to pay tax on capital stock 92 franchise tax on 95 computed on premiums 95 reports of, liable to pay 99 contents and how made 100 when to be paid 102 LAND: defined ( see Real Property ) 4 sold by the state to be taxed 10 leased by the state, assessed to lessee 10 sold for unpaid taxes. (See Sale.) redemption of 66 conjointly assessed 67 despoliation of, prohibited 68 unredeemed, notice to be published 69 comptroller's deed for 69 effect of former deeds 70 possession of, by comptroller 71 notice to occupants 71 proof of service of 72 redemption by occupant 72, 73 proceedings thereupon 73 notice to mortgagee 74 redemption by mortgagee 75 170 INDEX. LAND Continued: sold for unpaid taxes Continued : Page. cancellation 76 when set aside 76 expenses of sale 77 payment of money into state treasury 78 in counties not containing part of forest preserve 79 notice of sale 79 advertisement, and sale, how conducted 70 redemption SO conveyance of county treasurer 81 effect of SI refund of purchase money 82 lands belonging to state 82 contracts for sale, deemed mortgages 141 LAUNDRY CORPORATIONS : not to pay tax on capital 93 LEVY: of tax by board of supervisors 39 on personal property, for failure to pay tax 43 LIBRARY CORPORATIONS: exemption of real property 7 LIFE INSURANCE CORPORATIONS: accumulations of, when exempt 9 LIMITATION OF TIME : not to apply to tax actions 140 LITERARY CORPORATIONS : exemption of real property 7 LOAN ASSOCIATIONS: accumulations of, when exempt 9 LOCAL TAXATION: exemption of mortgages 141, 142 LOT: payment of tax on part of 47 LOT DIVISIONS: abandonment of 28 MANUFACTURING CORPORATIONS : not to pay tax on capital 93 MAP: and survey of lands imperfectly described 58 of lands sold for unpaid taxes 62 INDEX. 171 MEDICAL SOCIETIES: P&ge certain, exemptions ....................... i Q MINING CORPORATIONS: not to pay tax on capital ...................... 93 MINISTER : exemption of property of ....................... 3 MISSIONARY CORPORATIONS: exemption of real property .................... j MORTGAGES, TAXATION OF: apportionment, mortgaged premises in two or more counties. 144-146 in this and another state ....................... 144 145 procedure, rules regulating ............................ 145 assignment of mortgage, effect of non-payment of tax upon ____ 143 bonds of recording officers, county treasurers and chamberlain . . 148 approval by comptroller ............................... 148 contracts for sale of land, deemed mortgages .................. 141 definition, real property ................................... 141 mortgage of real property .............................. 141 executory contracts for sale of land ...................... 141 discharge of mortgage, effect of non-payment of tax upon ...... 143 evidence, effect of nonpayment of tax upon receipt of mortgage in .................................................... 143 exemptions, from local taxation ........................ 141, 142 from mortgage tax .................................... 142 extension of mortgage, effect of non-payment of tax upon ...... 143 foreclosure of mortgage, effect of non-payment of tax upon ..... 143 release of mortgage, effect of non-payment of tax upon ........ 143 rules and regulations respecting apportionment between the counties, etc .................................... 144-146 governing recording officers ................. " .......... 148 county treasurers and chamberlain ..................... 148 supervisory power of tax commissioners over recording officers. 148 of comptroller over county treasurers .................... 148 tax, rate of, for recording mortgage .......................... 142 mortgages executed after July 1, 1906 .................. 142 payment of tax on recording mortgage ................... 142 duty of recording officer to indorse receipt upon mortgage. . 142 172 INDEX. MORTGAGES, TAXATION OF Continued : tax, rate of Continued : Page receipt, indorsed upon mortgage, to be recorded therewith. . 142 record of, as conclusive proof of payment of tax 142 effect of nonpayment of tax 142, 143 duty of recording officer not to record unless tax paid. 142, 143 distribution, how made 146, 148 payment to county treasurers or chamberlain 146 deduction of office expenses 146, 148 one-half paid to the state 14G application of balance 14S, 147 list of mortgages, and location of mortgaged premises 146, 147 duties of board of supervisors 147 among towns, cities, villages and school districts. 147, 14S trust mortgages, made by corporations, how taxable 143 statement of present amount of secured indebtedness 143 statement as basis of computation of tax 143 statement conclusive against mortgagee, etc ' 143 payment of tax on amounts of principal indebtedness sub- sequentty advanced, etc 143 duty of recording officer upon payment of tax on trust mortgages 143 indorsement upon mortgage of receipt for tax 143 effect of such receipt 143, 144 tax on prior advance mortgages, how paid 149 MUNICIPAL CORPORATIONS : property exempt from taxation 6 bonds of, when exempt 7 NASSAU COUNTY: equalization, lands sold for taxes to county to be excluded 36 NAVIGATION CORPORATIONS: franchise tax on earnings 93 NEW YORK COUNTY: surrogates' taxable transfer assistants 123 INDEX. 173 NON-RESIDENTS: Page . bonds, mortgages, notes, etc., of, when exempt ................ 9 capital invested in state, taxation of ........................ 10 personal property of, not invested as capital, taxation of ....... 10 real property, assessment of ................................ 22 survey and maps of .................................... 22 boards of supervisors may change description of .......... 36 of United States, debts owing to, assessment .................. 24 statement of debts to be furnished by agents ............. 24 collection of unpaid taxes on debts due ................. 48 owners of rents reserved, review of assessment ................ 37 notice by collector of receipt of tax warrant .................. 43 may demand statement from collector ....................... 43 return of unpaid taxes, if county contains lands in forest preserve ............................................. 56 admission of, by comptroller ................................ 57 arrears of taxes on lands of ................................ 57 taxes, when and how paid to comptroller .................... 59 NOTICE: of assessment to banks .................................... 21 completion of assessment-roll and of review .................. 25 contents and how posted ............................. 25 of filing completed assessment-roll ........................... 27 of hearing on special franchise assessment ................... 32 of receipt of tax warrant, posted by collector ................. 42 publication of, in a city ................................ 43 to non-residents ........................................ 43 under mortgage tax article. (See Mortgages, Taxation of.) OCCUPANCY: terms means what ........................................ '1 OCCUPANTS : of lands sold for unpaid taxes, notice to .................... 71 who are ............................................. ' * proof of service of notice .............................. 72 79 redemption by ....................................... before service of notice ............................ 73 OMITTED PROPERTY: assessment of ........................................... correction of assessment-roll to include, by supervisors ........ 37 174 INDEX. ORGANIZATION TAX: Page. on capital stock of corporations not to apply to banks 90 OVERCHARGES: deduction, when land has been returned as containing too large a quantity 60 refund, when tax has been paid 60 OVERPAID: comptroller may draw warrant for excess 60 PALACE AND SLEEPING CAR CORPORATIONS: franchise tax on earnings 93 PENSION MONEY: real property purchased with, taxation of 6 exemption of, how granted 6 PERSONAL PROPERTY: defined 5 liable to taxation 5 deduction in assessment of 10 of non-residents, invested in this state as capital, taxation of . . 10 of non-residents, not invested as capital, taxation of 10 place of taxation of 10 when under control or in possession of agent, etc 11 of corporations 12 of non-residents 10 exempted from tax on mortgage 143 PHARMACEUTICAL SOCIETY: exemption of real property 10 PIERS: , land includes 4 PIPE-LINE CORPORATIONS: assessors to apportion valuation between school districts 27 franchise tax on earnings 93 INDEX. 175 PLACE OF TAXATION: Page of personal property of residents ............................ 10 under control of agents, etc ............................. II of personal property of non-residents .................. ...... 10 of real property ...................................... 1 1 divided by line of tax district .......................... 12 of corporations . . ... ..................................... 12 of individual banker .................................... 13 of mortgages ............................................. 141 PREMIUMS : definition of ............................................. 96 PRIEST: exemption of property of ................................... 8 RAILROAD CORPORATIONS: valuation to be apportioned between school districts .......... 27 payment of tax to county treasurer .......................... 44 organization tax, how. paid ................................. 90 additional franchise tax on earnings ....................... 93 not operated by steam, tax on earnings ...................... 94 reports of, liable to tax ................................... 9S RAILROAD STRUCTURES : included as land ......................................... 4 REAL ESTATE : defined ( see Real Property) ............................... 4 REAL PROPERTY: what constitutes ...................................... 4, 141 liable to taxation ........................................ 5 exemption of, when purchased with pension money ........... 6 of charitable, benevolent, etc., corporations .............. 7 of firemen's associations .............................. 8' of minister or priest .................................. ^ place of taxation of ....................................... Avhen divided by line of tax district .................... of corporations ..................................... non-resident, assessment of ................................ /surveys and maps of ................................... 22 boards of supervisors may change description of real prop- 3 reassessment of unpaid taxes on ............................ mortgages, taxation. (See Mortgages, Taxation of.) 17G INDEX. REASSESSMENT: Page of property illegally assessed 38 of unpaid taxes on resident real property 52 RECEIPTS: for taxes, collector to furnish 55 state board to prescribe forms 55 RECORDING OFFICERS: mortgage tax, payment to (see Mortgages, Taxation of) 142 instrument not recorded before payment 142, 143 receipts to taxpayers 142 payment of amount apportioned to other counties 146 expenses to be paid 146, 148 duties upon payment of tax on trust mortgages 143 supervisory power of tax commissioners 148 bond, amount and approval 148 RECORDING TAX ON MORTGAGES. (See Mortgages, Taxation of.) REDEMPTION: of lands sold for unpaid taxes 66 conjointly assessed 67 by occupants 72 before service of notice 73 proceedings thereupon 73 by mortgagee 75 of lands sold by county treasurer 80 when bid in by county and excluded from tax- roll 81 notice, expense of publishing 83 of mortgages sold for unpaid taxes 157 REFUND: of tax on transfer, erroneously paid 113 of tax paid on illegal assessment 133 REGISTER OF DEEDS. (See Recording Officers.) RELIGIOUS CORPORATIONS : exemption of real property 7 dwelling-houses and lots used by clergymen 8 REMOVAL: of person legally taxed, from county, county court to issue order 135 INDEX. 177 RENTS RESERVED: Page . taxable to whom 11 of non-residents, review of assessment 37 collection of taxes upon 45 REPORTS : of corporations, to assessors 21 penalty for failure to make 21, 22 of corporations liable to tax 98 contents, and how made 100 of certificates of incorporation by secretary of state 106 of surrogate and county clerk to comptroller 128 of county treasurer to comptroller 128 RESIDENCE: in tax district, how determined 11 controversy as to, tax commissioners may determine 11 RETURN: of unpaid taxes by collector 48 when collection has been enjoined 49 REVIEW: of assessment, notice of meeting for 25 SAFE-DEPOSIT COMPANY: tax on transfer of securities of decedent 114 SALE: of personal property by collector, for payment of tax 43 of lands, for unpaid taxes, notice 61 publication of notice 62 maps to be furnished by supervisor 62 how conducted 63 purchases for state or county 63 withdrawal of lands upon which the state has a lieu 64 bid of purchaser, when paid 65 certificate of, to purchaser . 65 new, when sale is set aside 65, 66 evidence of loss of 70 notice to occupants 71 proof of service of 72 redemption by occupant 72, 73 lien of mortgage not affected 74 notice to mortgagee 74 redemption by mortgagee 75 cancellation 76 when set aside 76 expenses of sale 77 13 178 INDEX. SALE Continued : Page. of lands, payment of money into state treasury 78 in counties not containing portion of forest preserve 79 notice of sale 79 conduct of 79 lists to be published, contents 80 redemption 30 of real property sold to county and excluded from tax-roll 81 notice, expense of publishing 83 conveyance by county treasurer 81 effect of conveyance 81 refund of purchase money 82 lands belonging to state 82 purchased by county of Nassau, excluded from tax- rolls 36 tax, surplus in hands of supervisor 138 of mortgage for delinquent taxes 157 SATISFACTION: of collector's bond 52 SAVINGS BANKS: deposits, exemption of 9 not to pay tax on capital 92 franchise tax on surplus 97 reports of, liable to pay 99 when to be paid 102 SCHOOL DISTRICTS: apportionment of valuation of railroad, telegraph, etc., com- panies between 27 of special franchises 31 SECRETARY OF STATE: reports of certificates of incorporation 106 SEQUESTRATION: attorney-general to bring action for, against delinquent cor- poration 137 SHERIFF: warrant to, for collection of debts due non-residents of United States 46 return of ; neglect to make 46 when to execute collector's warrant 11 to execute order on collector failing to pay tax 136 SPECIAL FRANCHISE: defined fi not to include street crossings 5 INDEX. 171) SPECIAL FRANCHISE Continued : PaKP column in assessment-roll for 1 :> valuation of, to be annually fixed 29 statement to be filed with clerk of city or town 2!) assessments, when filed in several cities 29 copy of statement to be delivered to assessors 30 to be entered in assessment-roll 30 apportionment among school districts 31 reports to state board of tax commissioners 31 hearing on assessment 32 certiorari to review assessment 33 appearance by state boord by special counsel 33 payment of his costs, expenses, etc 33 deduction from tax for local purposes 33 tax not to affect other tax 35 STATE: property exempt from taxation 6 bonds issued by, exemption 7 assessment of land leased or sold by 10 of lands in forest preserve 16 lands in forest preserve, payment of taxes 48 purchase by comptroller for, of land sold for unpaid taxes .... 63 lands, possession of 71 wild, vacant, forest, publication of list 71 STATE BOARD OF TAX COMMISSIONERS. {See Tax Commis- sioners, State Board of.) STATE TAX: payment by county treasurer 53 demand for, by comptroller 54 STEAMBOAT CORPORATIONS : franchise tax on earnings 93 STEAM HEATING AND PO\YER COMPANIES: franchise tax on reports of 98 STOCK TRANSFERS: tax imposed, rate 1 transactions subject to * penalty for failure to pay effect of failure to pay 1 application of amount collected 1 adhesive stamps to be affixed 1 how prepared and sold 1 canceling ; penalty for failure 1 contracts for dies 1 expenses, how paid 1 illegal use, penalty 1 civil penalty; how recovered 153 180 INDEX. STOCKHOLDERS. (See Corporations; Capital Stock.) p age . when not to be taxed 10 of bank, taxable on shares 13 list of, subject to inspection of assessors 17 no deduction from tax on shares 18 STREETS: franchises to use, included as land 4 crossings, when not deemed special franchise 5 SUPERVISOR: delivery of assessment-roll to 27 SUPPLEMENTARY PROCEEDINGS: for collection of tax 135 SURPLUS : from tax sale, in hands of supervisor 13$ SURROGATE: duties in respect to transfer tax 115 determination of, upon report of appraiser 120 transfer tax assistants in New York county 123 in Kings and other counties 123, 124 proceedings for collection of tax 124, 125 reports to comptroller 128 SURVEY: map and, of lands imperfectly described 58 TAXABLE TRANSFERS: how taxed 108 exceptions and limitations 1 10 to certain corporations, not to be taxed 110 lien of tax upon 112 payment of tax Ill when to be made Ill executor, administrator or trustee not entitled to accounting until tax is paid 1 12 deduction of tax from legacy or distributive share 112 interest, if tax is not paid 1 12 discount, if tax is paid within six months Ill refund of tax erroneously paid 113 devises or bequests to executors or trustees 114 safe deposit company or bank where securities are deposited to notify comptroller 114 jurisdiction of the surrogate in respect to 115 appraisers in certain counties 110 salaries 116, 117 county treasurer, to act as 117 proceedings by 117 report of, to surrogate 120 INDEX. 181 TAXABLE TRANSFERS Continued: Pagc< appraisal of values of 117 } us of contingent estates 119 of estates in expectancy 120 life estates, and remainder 118 appeal to surrogate 121 determination of values and tax by surrogate 120 notice to persons interested 120 reappraisal upon application to supreme court 121 composition of tax 122 surrogates' assistants in New York county 123 in Kings and other counties 123, 124 proceedings 'for collection of tax by district attorney 124, 125 receipt of payment of tax from county treasurer or comp- troller 126 fees of county treasurer 126, 127 books and forms to be furnished by comptroller 127 entries in, by surrogates 127 reports of surrogate ^"d county clerk to comptroller.... 127, 128 of county treasurer 128 of comptroller to state treasurer 128 taxes, deposit of, ^n banks 128 undertaking of banks 129 application of 129 exemption in section 4. not applicable ].?0 definitions ; " estate," " property," " transfer " 129 TAXATION : property subject to 5 exemptions from 6 of capital of non-resident 10 place of, of personal property of residents 10 of banks 18-20 of mortgages 141-165 TAX COMMISSIONERS, STATE BOARD OF: residence, questions to be determined by 11 special franchises, assessment of 29 statement of valuations to be sent to town and city clerks. 29 written report of. contents, etc 31 hearing o'i valuntion 32 certiorari to review assessment 33 appearance by state board by special counsel 33 payment of his costs, expenses, etc 33 notice of filing statement 33 appointment of, salary 84 powers and duties 84 secretary and agents and officers 85 report of, to legislature 85 visit counties 85 182 INDEX. TAX COMMISSIONERS, STATE BOARD OF Continued : Pa ge. members of state board of equalization 85 appeals to, from equalization of boards of supervisors 86 how brought and conducted 86, 87 determination of 87 costs 87 mortgage tax, duties under. (See Mortgages, Taxation of.) lists of mortgages, form prescribed 148 one to be filed with 148 correction of clerical errors 148 statements by mortgage owners, one to be filed with 151 appeals regulated 153, 154 forms prepared by 154, 155 apportionment of tax where land mortgaged is in two or more counties 144 in this and another state 144 procedure, rules regulating 145 certificates of determination to be filed 145 general supervisory power over recording officers 148 TAX DISTRICT: defined 4 person to be taxed in, for personal property 10 residence in, for purpose of taxation 11 real property in, how assessed 11 divided by line of 12 assessment districts, division into 14 TAX-ROLL: warrant to collector to be annexed to 39 in Nassau county, lands sold to county at tax sale to be ex- cluded 36 TAX SALE CERTIFICATE (see Certificate of Sale) 68 TELEGRAPH CORPORATIONS : assessors to apportion valuation between school districts 27 payment of tax to county treasurer 44 tax against, how enforced 45 franchise tax on earnings 93 TELEPHONE CORPORATIONS : assessors to apportion valuation between school districts 27 payment of tax to county treasurer 44 tax against, how enforced 45 franchise tax on earnings 93 INDEX. 183 TELEPHONE LINES: Page, included as land 4 TENANT: payment of tax by, may be deducted from rent 47 TITLE GUARANTY CORPORATIONS: not to pay tax on capital 92 TOWN CLERK: duty to mail to assessors notice of filing of data respecting cor- porations 22 TRANSFERS: tax upon ( see Taxable Transfers) 103 of stock, tax on 150-153 TRANSFER TAX. (See Taxable Transfers.) TRANSFER TAX CLERKS: in several counties 123, 124 in New York county 123 TRANSPORTATION CORPORATIONS : additional tax upon earnings 93 reports of 98 tax, when due 102 TRUST COMPANIES: not to pay tax on capital 92 franchise tax, how computed 96, 97 reports of, liable to pay 99 when to be paid 102 tax on transfer of securities of decedent 114 deposit in 129 undertaking, on deposit 129 payment of mortgage tax by 151-153 TRUSTEES: personal property in possession of, where taxed 10, 11 assessment of 24 tax on transfers, payment 112 collection 112 on devises or bequests in lieu of commission 114 foreign, to pay transfer tax on transfer of securities 114 UNITED STATES: property exempt from taxation 6 deposit fund mortgages exempt 142 UNPAID TAXES: return of, by collector 48 when collection has been enjoined 49 on resident real property, reassessment 52 184: INDEX. UNPAID TAXES Continued: Page. on lands of non-residents in certain counties 56 rejection of, by comptroller 56 admission of, by comptroller 57 sale of lands for, by comptroller, notice 61 publication of notice of 62 maps be furnished by supervisor 62 how conducted 63 withdrawal of lands upon which state has lien 64 bid of purchaser, when paid 65 certificate of, to purchaser 65 new, when sale is set aside 65, 66 redemption of land sold for 66 when conjointly assessed 68 unredeemed lands sold for, notice 69 lands sold for, comptroller's deed G9 notice to occupants 71 redemption by mortgagee 75 cancellation of sales 76 when set aside 76 expenses of sale ." . 77 payment of proceeds of sale into state treasury 78 in counties not containing portion of forest preserve .... 79 notice of sale 79 conduct of sale 79 redemption 80 conveyance by county treasurer 81 effect of 81 sale of mortgages for 157, 158 UNREDEEMED LANDS: sold for unpaid taxes, publication of notice 69 VACANCY: in office of collector, how filled 51 VALUATIONS: equalization of, by supervisors 36 statement of, to be delivered to comptroller 40 of estates subject to transfer tax * 117, 118 VERIFICATION: of assessment-roll 26 VESSELS: exemption of, owned by American citizens, or domestic cor- porations 9 VILLAGES: valuation of special franchises in 30 distribution of mortgage tax among 160 INDEX. 185' WARRANT: Page. for collection of taxes, contents 39 abstract to be furnished county treasurer 41 of taxes on debts due non-residents 46 collectors, when sheriff to execute 51 for collection of tax against corporation 104 WATER-WORKS CORPORATIONS : franchise tax on 94 reports of 98 WHARVES : land includes 4 WILD LANDS: divided by line of tax district, where taxed 12 University of California SOUTHERN REGIONAL LIBRARY FACILITY 405 Hilgard Avenue, Los Angeles, CA 90024-1388 Return this material to the library from which it was borrowed. 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