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The Following States Have Put in Operation
THE NEGOTIABLE INSTRUMENTS LAW
State
Alabama......................................
Alaska..........................................
Arizona.........................................
Arkansas .....................................
California....................................
Colorado......................................
Connecticut................................
Delaware.....................................
Dist. of Columbia....................
Florida.........................................
Georgia.......................................
Hawaii..........................................
Idaho............................................
Illinois..........................................
Indiana.........................................
Iowa..............................................
Kansas..........................................
Kentucky....................................
Louisiana.....................................
Maine............................................
Maryland....................................
Massachusetts...........................
Michigan.....................................
Minnesota...................................
Mississippi..................................
Missouri....................

In Effect
I, 1908
28, 1913
1. 1901
21. 1913
.....................July 31. 1917
.....................July 19, 1897
5. 1897
1. 1912
12. 1899
3, 1897
.....................Aug.
18, 1924
.....................Apr. 20. 1907
10, 1903
1. 1907
.....................July
30, 1913
4. 1902
.....................July
8, 1905
13. 1904
1. 1904
.....................July 7, 1917
1. 1898
1. 1899
.....................Sep. 16. 1905
1. 1913
.....................July
7. 1916
.....................July
. June 16, 1905

State
In
Montana...................................
Nebraska...................................
Nevada......................................
New Hampshire.....................
New Jersey..............................
New Mexico............................
New York.................................
North Carolina.......................
North Dakota.........................
Ohio............................................
Oklahoma...................................
Oregon.........................................
Pennsylvania...........................
Philippines................................
Rhode Island........................... .......................July
South Carolina.........................
South Dakota......................... ....................... July
Tennessee..................................
Texas..........................................
Utah............................................ ....................... "July
Vermont....................................
Virginia...................................... ....................... July
Washington..............................
W. Virginia..............................
Wisconsin..................................
Wyoming................................
Feb

Effect
7, 1903
1. 1905
1. 1907
1, 1910
4. 1902
21. 1907
1. 1897
8. 1899
1, 1899
1. 1903
10. 1909
19. 1899
2. 1901
31. 1911
1. 1899
25. 1914
1. 1913
16. 1899
18. 1919
1, 1899
1, 1913
1. 1898
7, 1899
1. 1908
15. 1899
15. 1905

The Maturity Section of this Law is as follows:
Every negotiable instrument is payable at the time fixed therein without grace. When the day of matu­
rity falls upon Sunday or a holiday, the instrument is payable on the next succeeding business day. Instruments
falling due on Saturday or becoming payable are to be presented for payment on the next succeeding business day.
except that instruments payable on demand may, at the option of the holder, be presented for payment before
12 o’clock noon on Saturday when that entire day is not a holiday.
Exceptions to the above Section are as follows:
MASSACHUSETTS, NEW HAMPSHIRE. NORTH CAROLINA and RHODE ISLAND allow grace on
Sight Drafts.
ARIZONA. KENTUCKY, MISSISSIPPI. NEBRASKA, NORTH CAROLINA, WASHINGTON and
WISCONSIN paper maturing Saturday is payable the same dav.
This Section in the Delaware Act reads:
Every negotiable instrument is payable at the time fixed therein without grace. When the day of maturity
falls upon Sunday, or a holiday, the instrument is payable on the next succeeding day. Instruments falling due
(or becoming payable) on Saturday are to be presented for payment on the next succeeding business day, except
that instruments payable on demand may, at the option of the holder, be presented for payment before twelve
o’clock noon on Saturday when that entire day is not a holiday


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2130

Dates of Regular Meetings
of Legislatures
Alabama, Second Tuesday in January, 1927, and every four years.
.March___________________ Every odd year.
Alaska, A Territory.
.January________________ Every odd year.
Arizona___________
.January________________ Every odd year.
Arkansas__________
.January_________________Every odd year.
California-------------.January____________
Every odd year.
Colorado__________
.January___________
Every odd year.
Connecticut_______
Delaware__________
Congress of the U. S. _First Monday in D<
each year.
. __Every odd year.
.April. __ __ _
Florida__
-Every odd year.
-June _
_
Georgia __
February
............
Every odd year.
Hawaii
Every odd year.
January
—
-------Idaho ___
_
Every odd year.
-January------__
..
Illinois__
.
_
-Every
odd year.
-January__
___
Indiana
Every
odd year.
January
______
—
.
Iowa____
Every
odd year.
.January
---Kansas__
Every
even
year.
-January
--------Kentucky.
May______
____ __ Every even year.
-January-----___ Every odd year.
Maine__________
Every odd year.
.January
_________
_
Maryland______
Every year.
-January__________
Massachusetts__
Every odd year.
January
—-------Michigan_______
Every odd year.
January
___
__
Minnesota______
Every even year.
-January
____
.
Mississippi-_____
Every odd year.
January______
_
_
Missouri________
January
Every
odd year.
Montana_______
January
.
Every
odd year.
Nebraska_______
_____
Every
odd
year.
January
_
—
----Nevada ________
Every
odd
year.
January____
__
New Hampshire.
__
-Every
year.
January
_
_
_
New Jersey-------January
Every odd year.
New Mexico____
_____Every
year.
-January
_______
New York______
_
_Every
odd
year.
-January_________
North Carolina—
_____Every
odd
year.
-January
_
_
_
___
North Dakota___
___
Every
odd
year.
-January
_____
_
Ohio___________
-January_________ .__ Every odd year.
Oklahoma______
Every odd year.
-January___________
Oregon-------------_
_
Every
odd year.
-January----------------Pennsylvania----Julv
_ Every year.
__ Every year.
-January---------- --Rhode Island-.
_____Every
year.
-January _ ________
South Carolina.
_Every
odd
year.
-January___________
South Dakota..
Every
odd
year.
.January----------------___
Tennessee-----Every
odd
year.
-January____
—
Texas________
January
.
Every
odd
year.
Utah_________
____
Every
odd
year.
-January___________
Vermont_____
.January___________ _Every even year.
Virginia______
Every odd year.
-January___________
Washington
Every odd year.
-January_________
West Virginia .
-January _______ __ ____ Every odd year.
Wisconsin----Every odd year.
. January_______—
Wyoming------


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2131

INTEREST RATES, GRACE ON SIGHT DRAFTS, AND STATUTES OF LIMITATION
For further information see also “Laws” of each State, indexed in back of this Volume
INTEREST RATES-NOTES AND
ACCEPTAN CES-GRACE
STATES
AND
TERRITORIES.

Rate
Legal
by
Rate ol
Interest Coil tr&ct

Notes and
Acceptances
Due on
Holi­
days.

Half
Days.

Are payable
Per ct. Per cent and protestable
the day—

Holidays
falling on
Sunday
are
observed
the day—

STATUTES OF LIMITATIONS

Notes.

Sight

Bills.

Drafts,

Notes
Open
and
Judg­
Ac­ Written ments.
counts. Con­
tracts.

Sealed
Instru­
ments
wit­
nessed.

Years.

Years.

Years.

Years.

Alabama______________
After
3
After After
No grace No grace
6
20
8
10
8
Alaska.................. .................
After*
8
After After
No grace
6
6
12
10
10
Arizona__________ ___
5
6
After
6
After
No grace
3
6
10
Arkansas....... .................... .
After After
After
No grace No grace
3
5
10
3-10!
5
6
California __________________
7
After
After
4
No grace
4
5
*
Colorado__________ ____ __
After
6
No grace No grace
6
3-20!
8
Any rate! After
6-20!
Connecticut_____ ___ __________________
6
After After
After
No grace No grace
12
17
6
6
20!
Delaware............. ................. ..............
6
After After
After
No grace No grace
6
6
20 S.
3
10R.
District of Columbia___________________
After After*
After
No grace No grace
3
3
6
8
12
12
Florida____ ___________________
After After
After
5
No grace No grace
3
10
20
8
20
Georgia................................ ................
No grace No grace
After After
After
4
6
20
8
7
7
Hawaii_______________ _____________
g
No grace
12
Idaho ................ ......... .............. ................
After After
After
No grace No grace
4
5
6
5
7
10
Illinois____ _______________________
After After
After
No grace No grace
10
5
20L
5
7
10
Indiana.......................................... ................
10
After
After
No
grace
20
6
After
No grace
6
20
8
Iowa_________________ _
After After
After
No grace No grace
10
20
5
6
8
10
Kansas______________________
After
After
5
After
No grace No grace
3
6
10
5
5
Kentucky........................................
After
5-15
On
After
No grace No grace 2-5
15
6
6
15
Louisiana___________________
After
5-10
No
grace
d
10
5
After
No grace
3
8
10
Maine............................. ................
6-20
After
No grace No grace
6
20
6
Any rate After After
20
Maryland_____ __ _____ ____________
After
3-12
After
No
grace
After
6
6(e)
No grace
3
12(b)
12
Massachusetts_____ _______
After!
After
6
Any rate!
No grace Grace
20!
After!
6
6
20
Michigan..____ _____________
After
After
6
No
grace
6-10
5
7
After
No grace
6
6
Minnesota_________________
g
6
6
6
10
Mississippi_______ ______ ____
g
3
6
7
o
6
After
Missouri______ ____ _______ ___
After After
After
No grace No grace
10G
10
6
8
5
10
Montana..__________________
After After
After
10
No grace No grace
8
8
5
10
8
Nebraska.......................................
After
After
10
No
grace
5
7
4
5-10!
No grace
5
After
Nevada............................ ..........
7
4
6
6
6
12
New Hampshire______ ____________
After
6
6
Any rate After After
No grace Grace
6
20
28
New Jersey........... ...... ......................... ..
After After Z . After
6
6
6 B.
No grace No grace
6
20
16
New Mexico____ _____ ________
4
7
6
6
12
After
New York______________ ____
6
After
After After
20
20
6
No grace No grace
6
6t
North Carolina......................................
6
3
3
18
6
10
North Dakota_______ ________
After
6
9
After After
6
6
No grace No grace
6
11
Ohio.....................................................
After
After After
15
6
8
15
No grace No grace
26X
6
Oklahoma......................................
After
5
10
After After
5
6
No grace No grace
3
5
Oregon______________________
After
10
After After
6
18
6
10
No grace No grace
6
Pennsylvania____________ _____
After
6
After After
6
6
20
No grace No grace
20T
6
Philippine Islands___________
♦
After After
After
10
10!
10
6
No grace No grace
6
Porto Rico_______ _______
6
12
Rhode Island___ ____ ____ _____
After After
After
6
20
6
V
No grace Grace
6
20
South Carolina_________ ____
After After
After
6
7
8
6-20
6
20
No grace No grace
South Dakota...............................
After After
7
10
After
6
20!
10-20!
No grace No grace
6
Tennessee................................
After After
After
6
6
6
6
Nograce No grace
6
10
Texas___________ ____________
10
After! After*
After
4
4
6
2
No grace No grace
10
Utah____ ______ ___________
8
12
After After
After
6
6
4
No grace No grace
8
Vermont............... ........................
After After
After
6
6-14
8
6
No grace No grace
6
8
Virginia............................ ............. . .•
6
After After
6
After
10
3
5
No grace No grace
10
Washington.....................................
g
12
After
West Virginia_____________ _____
After After
6
6
After
10
10
No grace No grace
5
10
Wisconsin__________________
ft
10
Wyoming____________________
7
10
After After
10
After
Nograce No grace
10
5
8
p _ ._
Alberta....................... .....................
5
G rci cc
British Columbia_____________
5
Manitoba............................................
5
New Brunswick_______________
5
Grace
Nova Scotia____________ ______
5
G race
CM
Q___
Ontario___________ ___________
5
Quebec______ ____ ___________
5
a i icr
G race
Saskatchewan
5
Any rate After
After
6
Grace
Grace
6
12
20*
+
^T ?i_°v®r’ du.®.'Saturday during June, July, and August protest Saturday or Monday at option o:
of holder. * No Statute. Generally after.
agreed upon m writing is legal on collateral demand loans of $5,000 and over.
If See laws, indexed in back of this volume.
irter timeS may agree m wn*m2 a higher rate of interest than 7%. but not exceeding 12% for one year, and
upon is legal, on loans over $300, but Colorado courts decline to endorse grossly unreasonable rates.
♦12% when there is security: 14% when there is no security.
i?iSftr'c(:«0LColuI??ia an>d Texas "instruments falling due Saturday are to be presented for payment on the next succeeding business day.
pay.a—See
o °?.,o«I5,anid
may'code.
at the option of the holder, be presented for payment before 12 o’clock noon on Saturday, when that
entire day is not a holiday,
1389 District
» Debts charged on land although by sealed instruments are outlawed in 12 years,
b No limitations on judgments against foreign corporations.
d Holidays falling on Sunday are observed the day except in towns of over 6,000, the holiday is observed the day after,
e A corporation may agree to pay any rate of interest and may not plead usury.
dormant five (5) years after the last execution is issued and may be revived within 21 years after becoming dormant.
T Must be revived every five years after entry, to retain lien on real estate.
exceeding fifty dollars. 30% including service and expenses. On amounts not exceeding fifty dollars, 5% per month for the first six
months. 2K% thereafter. Licensees under the Small Loans Act may charge 33^ per cent per month.
K. Must be revived every ten years to continue as a lien on real estate.
S. No statute; common law presumption of payment applied.
B. A corporation cannot plead usury. Under small loan act ($300 minimum) interest rate is IM% per month.
Pemapd interest may, at option of holder, be presented before 12 o’clock noon on Saturday unless such Saturday be a whole holiday.
G. Must be revised every three years to continue as a lien on real estate.
K. Limitations for charges on land is ten years.
L. Reference to laws governing revival


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2132

DIGEST OF BANKING AND COMMERCIAL LAWS
COMPILED EXPRESSLY FOR EACH EDITION OF THE RAND McNALLY BANKERS DIRECTORY

by prominent Attorneys in each State of the United States and each province of Canada, the name
of the compiler appearing at the head of each State. The Laws are entered alphabetically
according to States. Provinces of Canada are listed last.

IMPORTANT:

The states in which the Uniform Negotiable Instruments Law is in effect are listed on the
index to Laws. For Tabulated Information, for quick reference in regard to Interest Rates, Days of
Grace, and Statutes of Limitations, see page 16.
to continue this cause for one term for an award, but not longer with­
out consent of parties, or good cause being shown therefor. The
award of the arbitrators may be entered up and enforced as the judg­
ment of the proper court whether made in a pending suit or not.
Arrest. There can be no arrest on civil process except for con­
tempt and in cases of alleged lunacy, and upon writs of ne exeat.
Assignments and Insolvency. Every general assignment made
by a debtor, or conveyance by a debtor of substantially all of his
property in payment of a prior debt, by which a perference or priority
of payment is given to one or more creditors, shall enure to the benefit
of all the creditors equally, but this section shall not apply to mort­
gages, pledges, or pawns given to secure a debt contracted contem­
poraneously with the execution of the mortgage. All assignments by
a debtor made with intent to hinder, delay, or defraud creditors are
void. All deeds of assignment for the benefit of creditors shall, as
soon as executed, be filed and recorded in the office of the judge of
probate of the county in which the property is situated. Every
judgment confessed, attachment procured by the debtor, or other dis­
position of property by which a debtor conveys all, or substantially
all, of his property which is subject to execution in payment or as
security for a debt shall be deemed a general assignment.
Attachment process will issue upon affidavit by the creditor or his
agent of the amount due and that the debtor absconds, or resides,
out of the State, or secretes himself so that process cannot be served
upon him, or is about to remove out of the State, or has or is about to
fraudulently dispose of his property, or fraudulently withholds money,
chattels, or effects which are liable to the satisfaction of his debts:
plaintiff must give bond in double the amount claimed. Attachments
will issue for the following demands; 1. To enforce the collection of
a debt, whether it be due or not, at the time the attachment Is taken
out. 2. For any moneyed demand, the amount of which can be
certainly ascertained. 3. To recover damages for a breach of con­
tract when the damages are not certain or liquidated. 4. When
the action sounds in damages merely in following cases, viz.: 1. Where
defendant is a non-resident. 2. When the defendant has absconded.
3. When defendant has secreted himself. 4. When defendant is
about to remove from the State. 5. When defendant is about to
remove his property from State. 6. When defendant is about to or
has fraudulently disposed of his property or fraudulently withholds
same. One non-resident may sue out an attachment against another
non-resident by making oath that the defendant has not sufficient
property within the State of his residence wherefrom to satisfy the
debt. Attachments may be sued out in aid of a pending suit when
any of the above grounds exist by making affidavit and executing
bond Garnishment process will issue in aid of attachment in all
such cases. Garnishment may be dissolved by giving bond. In all
cases of attachments sued out by a resident solely upon the ground
that the defendant is a non-resident, the attachment may issue with­
out giving bond, but if defendant appears and pleads, bond must be
given or the attachment dismissed.
Banks. The national bank system is in force in this State uncon­
trolled in any way by State laws, except that the shares are subject
to taxation as other personal property, but the bank is required to pay
the tax.
There is no provision of law for the establishment or banks of Issue
in this State. Banks of discount and deposit may be established
under the general incorporation laws. Open depositors and savings
depositors on equal footing in case of Insolvency.
Any banker who discounts a bill or note at a greater rate than 8
per cent cannot enforce the collection of same except as to the prin­
cipal. and if any interest has been paid it must be deducted from the
principal.
Blue Sky Law. It is unlawful to sell or offer for sale In this
State any speculative securities without first obtaining permit rrom
the State Securities Commission.
Collaterals. Receipt must be given if demanded. Pledges or col­
laterals not transferable without transfer of the debt; after two days
notice In writing collaterals may be sold, by advertising for five days
at public outcry.
Conditional Sales are good between the parties, but void where
personal property delivered to vendee as against purchasers for a
valuable consideration, mortgages and Judgments creditors, without
notice, unless In writing and recorded in the office of the probate
judge.
Conditional contracts of sales must be recorded in office of the
Judge of Probate of the county in which the property Is located,
to be valid against subsequent purchasers, judgment creditors, or
mortgagees without notice, except In counties having a population
of more than 80,000 when contract is for a less amount than $200.00
If the property is removed to another county, contract must be
recorded in latter county within three months after removal.
Conveyances. All persons of the age of twenty-one years, not
laboring under some legal disability, may convey their real estate or
any interest therein by instrument in writing signed by the grantor
or his agent duly authorized in writing, and attested by one witness, or
if the grantor cannot write, by two witnesses who are able to write,
and who sign their names as witnesses. If the grantor is not able to
sign his name it must be written for him, and the words "his mark"
written over or against it. The person writing his name must sign
as a witness. A parol lease for less than one year is valid. A married
woman over eighteen years of age may convey dower in her husband’s
lands, and has generally the same rights as married women over twentyone years of age. The husband must join in any conveyance of the
wife’s separate estate. Conveyances, to operate as notice, must be
acknowledged and recorded. General acknowledgment must be
signed to make instrument self-proving. Married women must
acknowledge twice in the event the homestead .is conveyed. Form
of general acknowledgment is as follows:
The State of Alabama,......................... County

SYNOPSIS OF

THE LAWS OF ALABAMA
RELATING TO

BANKING AND COMMERCIAL USAGES.
Revised by Ritter, Wtnn & Carmichael. Attorneys at Law,
610 First National Bank Bldg., Birmingham. (See Card in Attorneys
List.)
Acknowledgments or proof of real estate Instruments may be
taken before one of the following officers: 1st. Within this State,
Judges of the supreme and circuit courts and the clerks of such courts,
chancellors, registers in chancery, judges of the courts of probate.
Justices of the peace, and notaries public. The official should certify
that the person signing the conveyance is known to him and acknowl­
edges that “being informed of the contents of the conveyance he
executed the same voluntarily on the day the same bears date.”
2d. Outside of State—Judges and clerks of any federal court, judges
and clerks of any court of record in any state, notaries public, or com­
missioners appointed by the governor of this State; beyond the limits
of the United States, by the judges of any court of record, mayor or
chief magistrate of any city, town or borough, or county, notaries
public, or by any diplomatic, consular, or commercial agent of the
United States. Foreign officers must attach official seal which fact
must appear in certificate. For forms of deeds see “Conveyances.”
Actions. All ordinary suits at law are commenced by suing out
a summons which must be accompanied by a complaint stating the
cause of action. Non-resident plaintiffs are required to give security
for costs. When two or more persons are jointly bound by judgment,
bond, or agreement, the obligation is several as well as joint.
Actions on Account. Suits upon open accounts may be accom­
panied by itemized, verified statement of the account, which when
filed with the summons and complaint may be admissible in evidence
to prove the account unless its correctness Is denied under oath by
defendant within the time allowed for pleading. Such statements
must be sworn to by a person having knowledge of the correctness
of the account and must show that the amount is due and unpaid
after allowing all offsets and counter claims and when sworn to out­
side State, must bear official seal of officer.
Acceptance. Unconditional promise In writing to accept a bill
before or after drawn is good in favor of all who take it upon faith
thereof for value. The holder may decline a qualified acceptance and
treat the bill as dishonored; if he takes qualified acceptance drawer
and endorsers are discharged.
A Check is a bill of exchange on a bank payable on demand;
must be presented within reasonable time after issue and if dishonored,
notice must be given or drawer is discharged to the extent of loss
caused by delay: does not operate to assign any part of drawer’s funds
in bank, and bank is not liable unless it accepts or certifies. If holder
has check certified the drawer and endorsers are discharged. The
making, uttering, drawing, or delivery of a check, draft, or order
upon which payment is refused upon due presentation because of
lack of funds shall be deemed prima facie evidence of Intent to de­
fraud and party may be convicted of a misdemeanor.
The present negotiable instrument law of Alabama, consisting of
196 sections went into force Ausugt 9. 1907. Its provisions do not
apply to instruments made prior thereto, and is substantially uniform
negotiable Instruments Act. The act so materially changes the law
in this State as to suggest the propriety of special examination in any
doubtful case.
Administration of estates is had in the probate courts of dece­
dents’ residence. All claims must be presented by filing a verified
statement thereof in the office of the Judge of Probate in which
letters are granted within six months after granting of letters testa­
mentary or of administration. Infants and persons of unsound mind
have one year to present their claims after disabilities are removed.
Administration of intestate is granted, 1st: To the husband or widow;
2d: The next of kin entitled to share in the distribution of the estate;
3d: The largest creditor of the intestate residing within this State;
4th; Such other person as the judge of probate may appoint. There
can be no appointment until after expiration of five (5) days from date
of death. Preference must be exercised within forty days or rights
relinquished. If several entitled to administer, men are preferred to
women and whole blood to half blood. Nonresident executors and
administrators may sue in this State by recording in probate judge’s
office copy of letters and giving bond to faithfully administer prop­
erty. A nonresident may be appointed administrator or executor of
a deceased resident’s estate. Administrations may be removed to
court of equity.
Affidavits may be taken within the State before every judge or
clerk of any court, justices of the peace, and notaries public or any
other person invested by law with judicial functions. Outside the
State and within the United States may be taken before any judge or
clerk of federal court, judge of any court of record in any state,
notaries public and commissioners appointed by the governor. For­
eign officer taking affidavit must attach 6eal which fact must be
recited in the jurat.
Allens. "Foreigners who are, or may hereafter become, bona fide
residents of this State, shall enjoy the same rights in respect to the
possession, enjoyment, and Inheritance of property as native-born
citizens."—Sec. 34, Const.
Alterations. When a negotiable instrument is materially altered
without the assent of all the parties liable thereon, it is voided
except as against a party who has himself made, authorized, or
assented to the alteration and subsequent endorsers. But when an
instrument has been materially altered and is in the hands of a holder
In due course, not a party to the alteration, he may enforce payment
thereof according to its original tenor. Material alterations consist
of any changes in date; sum payable interest on principal; time or
place of payment; number and relation of parties; medium or currency
In which payment is to be made.
Arbitration. Courts are compelled by statute to make an order
submitting cases for arbitration when moved for by the parties, and


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Federal Reserve Bank of St. Louis

I............................................................................................ a (style of officer).
hereby certify that.........................................................whose name is signed
to the foregoing conveyance and who is known to me, acknowledged
before me on this day, that, being informed of the contents of the
conveyance, he executed the same voluntarily on the day the same
bears date. Given under my hand and seal, this.................... day of
.....................A. D
(Seal!

2133

Notary Public

2134

BANKING AND COMMERCIAL LAWS—ALABAMA

No time Is required within which conveyances shall be recorded.
They operate as notices from date of delivery to probate judge for
record. (See Acknowledgments.) They may be used as evidence
without further proof of execution. Leasehold estates may be
created to last not exceeding twenty years, but if longer void as to
excess. A married woman must make the following acknowledgment
to a conveyance of a homestead:
State of.......................County of......................
I ......................... judge of................. (or other officer) do hereby certify
that, on the.....................day of............................19. . . ., came before me
the within named............................................... known to me (or made
known to me) to be the wife of the within named....................................
who, being examined separate and apart from her husband touching
her signature to the within.................... . acknowledged that she signed
the same of her own free will and accord, and without fear, constraint,
or threats on the part of her husband.
In witness whereof, I hereto set my hand and official seal this
......................... day of..........................19....
(Official Character.)
Corporation to make following acknowledgment:
whose name as........................................ of the said corporation, is signed
to the foregoing conveyance, and who is known to me, acknowledged
before me on this day that, being informed of the. contents of the
conveyance, he, as such officer, and with full authority, executed the
same voluntarily for and as the act of said corporation.
Corporations. Every company, corporation, or association, not
organized under the laws of Alabama, engaged in any other business
than insurance, shall, before engaging in any business in this State,
file in the office of the secretary of state, at the capitol in Montgomery,
an instrument in writing under the seal of such company, corporation,
or association, and signed officially by the president and secretary
thereof, designating at least one known place of business in this State,
and an authorized agent residing thereat must also file certified copy
of charter. If such corporation is engaged in any business of insuance,
the statement must be filed in the office of the insurance commissioner.
If the agent is changed, a new paper must be filed. Held not to apply
to corporations selling goods by travelling agent or sample. Foreign
corporations transacting business in this State without complying with
above provisions for each offense forfeit to the State $1,000, and any
person acting as agent for foreign corporation that has not so complied,
forfeits for each offense $500. All foreign corporations doing business
in this State are required to pay license fees ranging from $25 upward,
according to capital. Foreign corporations can do no business until
fees are paid and all contracts before then are void. Every foreign
corporation required to procure from secretary of state a permit to
do business in the State. This permit costs $10 per annum.
Courts. Terms and jurisdiction. The supreme court, except to
Issue writs of injunction, habeas corpus, quo warranto, and other
remedial and original writs necessary to its supervision of inferior
courts, and impeachments of judicial officers, has only appellate juris­
diction and cases are tried on the record sent up. Court of appeals
has final appellate jurisdiction in the following cases: 1. When
the amount involved exclusive of interest and costs does not exceed
the sum of $1,000. 2. Of all misdemeanors, including the violation
of town and city ordinances, bastardy, habeas corpus, and all felonies,
where the punishment has been fixed at twenty years or under
Circuit courts have unlimited common law jurisdiction when the
matter or sum in controversy exceeds $50, and exclusive jurisdiction
of libel, slander, assault and battery, and ejectment. Circuit Courts
are held twice each year in every County and exercise full jurisdiction
in equitable and common law actions, though pleadings and procedure
are not affected by consolidation of the two systems. Justices of the
peace have jurisdiction of all civil causes where the amount in con­
troversy does not exceed $100 in value, except in cases of libel, slander,
assault and battery, and ejectment. Names of all parties, plaintiff
and individual names of co-partners, must be set out in writs.
Partnership may be sued in courts of law, in firm name, without setting
forth names of co-partners, but judgment in such suits bind only
partnership’s property, not that of individual partners. The writ
may be served upon any one of the partners; the judgment reaches
the partnership property alone. Any one partner, or his personal
representative, may be sued alone on a partnership obligation. Nonresidents must give security for costs when suit is commenced or
within such time thereafter as the court may direct. Money may
be deposited with the clerk instead of sureties.
Days of Grace are abolished. (See Negotiable Instruments.)
Depositions. In cases at law, depositions may be taken of wit­
nesses who cannot be present at the trial in the following cases:
When the witness is a female; when the witness is too sick to attend
court; when the witness resides more than 100 miles from the place of
trial, or is absent from the State; when the witness is about to leave
the State, and not return in time for the trial; when the witness is the
sole witness of the facts; when the witness is one of the officers desig­
nated in Code No. 4030. Affidavit must be made of one of the above
facts, and of the materiality of the witness. May be taken on inter­
rogatories by a commissioner appointed by the court for that purpose.
The commissioner may be any suitable person, need not be an officer.
In equity suits, where witnesses live within, 100 miles of the place of
trial, depositions may be taken by oral examination before the reglter, or a special examiner, or commissioner appointed for the purpose.
Descent and Distribution. The real estate of persons dying
Intestate, in this State, descends, subject to the payment of debts and
the widow’s dower as follows: First to the children of the intestate
or their descendants per stirpes In equal parts. Next, to the parents,
if they survive, in equal parts. If only one parent survives, then
one-half to such parent and one-half to the brothers and sisters of the
deceased or their descendants, and if there be no brothers and sisters
and their descendants, then the whole estate shall go to the surviving
parent. If there are no children or their descendants, and no father
or mother, then to the brothers and sisters of the intestate, or their
descendants, in equal parts. If there are none of the above to take,
then the whole to the husband or wife of the intestate, and if there be
no husband or wife or none of the foregoing living, then to the next
of kin in equal degree in equal parts. If there are no next of kin
it escheats to the State. The personal estate is distributed the same
as the real estate, except that if there are no children the widow is
entitled to all of the personal estate. If but one child she takes onehalf. If not more than four children to a child’s part and if more
than four to one-fifth. Posthumous children take as others. Illegiti­
mate children inherit from their mother. The husband upon the
death of the wife is entitled to half of her personal estate absolutely,
and to the use of all of her real estate for life, unless he has been divested
of all control over her estate by a degree of the chancery court.
Damages recovered by personal representative for death of deceased
are distributed according to statute of distribution and are exempt
from payment of debts.
Discovery. Either party to a suit at law or in equity may examine
his adversary by filing written interrogatories and making affidavit
that answers will be material evidence for him.
Dower. Unless the wife has relinquished her right of dower in the
manner provided by statute she is, upon the death of the husband,
entitled to dower in all lands of which the husband was seized in fee
during the marriage, or of which another was seized to his use or to
which he had a perfect equity, having paid all the purchase money
therefor. The dower interest is one-half when the husband leaves no
lineal descendants, and one-third when the estate is insolvent or the
husband leaves children or their descendants. If the wife has at the
death of the nusbana a separate estate equal in value to her dower
Interest, she shall not have dower, and if of less value is only entitled
to such amounts as with her estate will make the full value of the dower.


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Executions. Property subject to: 1st: On real property to
which the defendant has a legal title or a perfect equity, having paid
the purchase money, or in which he has vested interest, in possession,
reversion, or remainder, whether he has the entire estate, or is entitled
to it in common with others. 2d: On personal property of the defen­
dant (except things in action), whether he has the absolute title there­
to, or the right only to the possession thereof for his own life, the life
of another, or a less period. 3d: On an equity of redemption In either
land or personal property, when any interest less than the absolute
title is sold. The purchaser is subrogated to all the rights of the
defendant, and subject to all his disabilities. Writ of fieri facias is a
lien only within the county in which it is received by the officer, on
lands and personalty of defendant subject to levy and sale, from the
time only that the writ is received by such officer and continues as
long as writ is regularly delivered to the sheriff without the lapse of an
entire term. A statement of a judgment certified by the clerk of the
court may be filed in the office of the judge of probate, which makes
the judgment a lien within the county in which It is filed for ten years
thereafter. Execution may be issued on such judgment at any time.
Executions issued by justices are liens on the property of the defen­
dant, on which they are levied, from the time of the levy. An order
must be obtained from the circuit court for the sale of lands levied on
under execution from a justice’s court. No stay of execution in circuit
court except by appeal, and supersedeas bond which delays collection
until affirmance by supreme court, and entails 10 per cent damages,
with legal interest and costs. In justice’s court stay is granted on
good security, below $20, thirty days over $20, sixty days.
Exemptions. Homestead not exceeding 160 acres and $2,000 In
value.
Personal property to the amount of $1,000. Exemptions of personal
property may be waived by instrument in writing except as to certain
household furniture and provisions and wages to amount of $25.00
per month.
Fraud. Obtaining money or goods on credit under false color or
pretense of carrying on business, or under false representation of
pecuniary condition, with intent to defraud, or bringing into the State
money or goods so obtained, punished as larceny.
Statute of Frauds. In the following cases, every agreement, or
note or memo thereof, expressing the consideration, is in writing and
signed by the party to be charged: 1st. Every agreement which by
its terms is not to be performed within one year from the making
thereof. 2d. Every special promise by an executor or administrator
to answer damages out of his own estate. 3d. Every special promise
to answer for the debt, default, or miscarriage of another. 4th. Every
agreement, promise, or undertaking, made upon consideration of
marriage, except mutual promises to marry. 5th. Every contract
for the sale of lands, tenements, or hereditaments, or of any interest
therein, except leases for a term of not longer than one year, unless
the purchase money, or a portion thereof, be paid and the purchaser
be put in possession by the seller.
Garnishment may issue in any case after suit commenced upon
affidavit of necessity and bond as in attachment cases, or after judg­
ment. without bond.
Holidays. The following are the legal holidays: Sunday, Christmas
Day, first day of January, nineteenth day of January, twenty-second
day of February, Mardi Gras Day. which is Tuesday before Ash
Wednesday, thirteenth day of April, twenty-sixth day of April, third
day of June, fourth day of July, first Monday in September, October
twelfth, eleventh day of November, and the day designated by the
governor for public thanksgiving.
If Christmas Day, or 1st of January, or 19th of January, or 22nd
of February, or 13th of April, or 26th of April, or 3rd of June, or
4th of July, or 11th of November falls on Sunday the following Mon­
day is a holiday. All businass transacted by Banks on any holiday
excep Sunday is legal.
Husband and Wife. The wife has full legal capacity to contract
as <f she were sole, except that she can not alienate or encumber her
real estate without the husband joining in the conveyance, unless the
husband be insane or has abandoned her, or is a non-resident, or is
imprisoned under a conviction for crime for a period of two years or
more, in which cases the wife may convey it as if she were sole.
Husband and wife may contract with each other, but the wife can­
not be surety for the husband. All of the property and the earnings
of the wife are her separate estate, and are not liable for the debts of
the husband. The wife must sue and be sued alone for all matters
relating to her separate estate or contracts, and for all torts to her
person or property. Divorce bars dower and husband's courtesy.
Interest. Legal rate is 8 per cent, and same is allowed on all open
accounts, judgments, and decrees. Usury forfeits all interests and
any sums paid as interest on an usurious contract shall be credited on
the principal.
Judgments of courts of record are proved by a certified transcript.
Judgment not a lien, but when a ceritfied statement thereof, made by
the clerk of the court is filed in the office of the probate judge, it
becomes a lien on all property of the defendant therein in the county,
which is subject to execution for ten years, to enforce which execution
may issue at any time within that period. Execution received by
sheriff during life of defendant may be levied after his decease or alias
execution issued and levied if there has not been lapse of entire term
do as to destroy lien originally created. Above applies to executions
from circuit and chancery courts. An execution issued by a justice
of the peace is a lien only from time of its levy. All agreements to
confess judgment, or to authorize another to confess judgment, made
before the commencement of the suit in which such judgments are
so confirmed are void.
Mechanics’ Lien.
Contractors, including subcontractors,
mechanics, material men, and laborers have a lien on houses built
and the ground on which they stand upon complying with the law.
Lien for JBent. The landlords of any store house, dwelling house,
or other building, shall have a lien on the goods, furniture and effects
belonging to the tenant, and sub-tenant for his rent, which shall be
superior to all other liens, except those for taxes, also on crops grown
on rented premises for rent of the current year
Limitations. Notes and stated accounts, six years; open accounts,
three years; sealed instruments, real actions, and motions against
officers, ten years; judgments, twenty years; actions on the case, one
year. Bar created by statute can only be removed by a partial pay­
ment, made on the contract before the bar is complete, or by an uncon­
ditional promise in writing. If anyone entitled to bring an action,
or make an entry on land, or defense founded on title to real estate,
be at the time such right accrues, within the age of twenty-one years,
or insane or imprisoned on a criminal charge for a term less than life,
he shall have three years, or the period allowed by law, for bringing
such action, if the period allowed by law be less than three years, after
the termination of such disability to bring such suit, etc., but no actioD
can be commenced after twenty years. Statutes of limitation apply
to married women’s separate estates. Actions founded on a promise
in writing not under seal, or for trespass to person or property, must
be brought within six years. Statutes of limitation are made appli­
cable to equitable as well as legal demands, but do not run against direct
trusts. Any agreement or stipulation to shorten the period prescribed
by law for the bringing of any action is void. Actions seeking relief
on the ground of fraud where the statute created a bar- the cause of
action begins to run upon discovery of the fraud by aggrieved party,
No promise or acknowledgment is sufficient to remove the bar to a
suit, except a partial payment made upon the contract by the party
sought to be charged before the bar is complete, or an unconditional
promise in writing, signed by the party to be charged thereby.
Married Women. (See Husband and Wife.)
Mortgages are executed and acknowledged in the same manner as
deeds. May be foreclosed by bill in equity, or if there be a provision
to that effect, by sale under power, upon such default as authorized

BANKING AND COMMERCIAL LAWS—ALASKA
ft sale. All mortgages are void against creditors or purchasers without
notice, unless recorded. Mortgages operate as notice from day of
delivery to probate judge for record. There is no fixed time within
which they shall be recorded. Homestead realty cannot be mort­
gaged or otherwise aliened without the voluntary signature and assent
of wife, evidenced by acknowledgment, upon private examination
separate and apart from the husband, and certified. All mortgages
must be in writing, signed by the mortgagor. Payment of mortgage
debt made before or after maturity of debt, revests in the mortgagor,
or his assigns, the title to the real or personal property mortgaged, if
made in the lifetime of the mortgagor; if made after his death, such
payment revests title to personal property in the personal representa­
tive, and title to realty in the heirs, devises, or legatees of the mortga­
gor. Chattel mortgages must be in writing. When the mortgagor
is sued by the mortgagee for possession of the mortgaged property,
he may defend by showing payment of the debt, or part payment and
a tender of the balance, or may pay it after judgment.
Negotiable Instruments. Must be payable in money and must
contain an unconditional promise to pay a sum certain on demand or
at a fixed or determinable future time; must be payable to a specified
person or bearer; may be in installments and contain provision that
on any default the whole shall become due; with exchange fixed or
current rate, interest, and attorney's fees for collection; may authorize
sale of collaterals but cannot authorize confession of judgment if it
reads, “I promise to pay” all signers are jointly and severally liable;
may be payable at fixed time after date or sight, or after specified
certain event, but not upon a contingency: can waive exemption from
execution; need not specify value given nor place where drawn or
payable; if issued, accepted, or endorsed when overdue it is payable
on demand; may be payable to two or more payees jointly, or one or
more of several payees, or to the estate of a deceased person; absence
or failure of consideration a defense against one not a holder in due
course and partial failure a defense pro tanto. One not a party to
instrument placing a signature in blank before delivery becomes an
endorser. Every endorser engages that on due presentment it shall
be honored or that he will pay the amount to holder or any subsequent
endorser who may be compelled to pay; no days of grace; when
maturity falls on Sunday or holiday payment is due on next business
day; if due on Saturday must be presented on next business day. but
if payable on demand holder may present same before noon on Satur­
day. Fraud and circumvention in procuring execution of instrument
is a defense against any holder.
Partition. Partition of real or personal property may be made,
upon application of any tenant in common in either Courts of Probate
or Courts of Equity, and may be sold for division if it can not be
equitably divided.
Powers of Attorney. Powers of attorney or other instruments
conferring authority to convey property must be proved or acknowl­
edged in the same manner and must be received as evidence to the
same extent as conveyances (see Conveyances), and msut be executed
as conveyances. A power of attorney to relinquish dower must be
executed by husband and wife jointly. Her signature must be
acknowledged as required for conveyances of land.
Presentment. Is not necessary to charge one primarily liable
except in case of bank notes; if payable at special place ability and
willingness to pay it there at maturity is equivalent to a tender; if
not on demand it must be presented on day it falls due, if on demand
then within a reasonable time after its issue, except a bill of exchange
must be presented within reasonable time after its last negotiation.
Probate Law. A court of probate, consisting of one judge, is
established for each county in the State. This court has jurisdiction
of the probate of wills, of granting letters testamentary and of admin­
istration, and the repeal of revocation of the same; of the settlements
of accounts of executors and administrators, of the sale and disposition
of the real and personal property belonging to, and the distribution of.
Intestates’ estates. Also of the appointment, removal, and settlements
of guardians for minors and persons of unsound mind, the binding out
of apprentices, the allotment of dower, and the partition of land belong­
ing to joint owners. A court of probate must be held at the court
house of each county on the second Monday of each month, and the
judge may hold special or adjourned terms whenever necessary, but
such court must at all times be considered open, except on Sundays.
It also keeps a record of deeds, mortgages, and instruments entitled
to record.
Promissory Note. Must be unconditional promise in writing to
pay on demand or at fixed or determinable time a sum certain in money
to order or bearer, and where drawn to maker's own order is not com­
plete until endorsed by him; may be in installments.
Protest. (See Negotiable Instruments.)
Protest of Foreign Bills. May be made by notary public or by
any respectable resident of the place in presence of two or more credible
witnesses; bill of exchange does not operate to assign funds in hands
of drawee and he is not liable unless he accepts.
Replevin. Writ of replevin lies to recover property in custody of
an officer of the law, and is limited to this. The action of detinue
lies to recover personal property in all other instances.
Sales in Bulk. Sales of all or substantially all of stock of mer­
chandise except in regular course of trade is prima facie fraudulent
and void against creditors unless they are notified in writing prior to
the sale in manner prescribed by statute.
Taxes become due October 1st, and delinquent on the 31st of
December of the year for which they are levied and lands may be
sold by proceedings had in the Probate Court commenced in the
month of March following the due date of taxes provided the personal
property is insufficient to pay taxes. The rate of taxation is 6J mills
or sixty-five cents on each $100.00 on amounts assessed. This is for
State purposes only. Municipalities may levy taxes at the rate of
fifty cents on each $100.00 except that certain named municipalities
of the larger class may levy a larger amount by special constitutional
provision. Counties may levy similar amount to the municipalities
except that certain special taxes varying in different counties are
levied In addition. Assessments based on 60% of the valuation of
the property. Counties may vote additional levies for specific
purposes and may secure the same by bonds. The purchaser of lands
sold for taxes receives from the tax collector a certificate of purchase
showing a description of the property, the date and amount of assess­
ment, the taxes, costs, and fees, etc., and after the expiration of two
years from the date of sale, the purchaser may get a deed from the
Judge of Probate. The delinquent tax payer, has two years from
date of sale in which to redeem. After purchaser goes into possession
under a deed and keeps possession for three years recitals in the deed
are held to be true and cannot be disproved. On redemption, the
person redeeming pays the amount of taxes for which the land sold,
costs of sale, with interest at 15% per annum and all taxes paid sub­
sequent to the sale by the purchaser with interest thereon at 8 % per
annum. Whenever land is sold for state or county taxes, and from
any cause such sale is invalid to pass title to purchaser, sale operates
as transfer to purchaser of lien of state or county, on the property for
payment of taxes for which sold. All cotton factories or cotton mills
which shall be constructed in this State within five years shall be
exempt from taxation for a period of ten years, provided such mills
represent an investment of $50,000.
Wills. All wills of real or personal property must be in writing
signed by the testator and declared his last will and testament in the
presence of two witnesses who must sign as witnesses in the presence
of testator. Unwritten will of personal property valid only when
the property does not exceed $500 in value, and must be made dur­
ing last sickness by testator at his home. Persons present must
be called on to witness tnat It is testator's will and must be re­
duced to writing by one of the witnesses within six days. Minor
over eighteen may make a will of personal property. No will effective
until probated. May be contested in probate or chancery court.


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2135

SYNOPSIS OF

THE LAWS OF ALASKA
RELATING TO
BANKING AND COMMERCIAL USAGES
Revised by R. E. Robertson. 200 Seward Bldg., Juneau. Alaska
(see card in Attorneys List)
Acknowledgments. (See Deeds.)
Actions. The distinction between actions at law and suits in
equity and all forms of pleading heretofore existing in actions at law
and suits in equity are abolished, and there is but one form of action,
denominated a civil action, for the enforcement or protection of prk
vate rights and the redress or prevention of private wrongs. Every
action must be prosecuted in the name of the real party in interest,
except that an administrator or executor, a trustee or an express trust,
or a person expressly authorized by statute may sue without joining
with him the person for whose benefit the action is prosecuted; but
the assignment of a thing in action not arising out of contract is not
authorized.
Affidavits. An affidavit or deposition taken out of Alaska, other­
wise than upon commission, must be authenticated as follows: 1.
It must be certified by a commissioner appointed by the governor of
Alaska to take affidavits and depositions in the state, territory, district
or country where taken; or, 2, it must be certified by a judge of a
court of record having a clerk and a seal to have been taken and sub­
scribed before him at a time and place therein specified, and the
existence of the court, the fact that such judge is a member thereof
and the genuineness of his signature must be certified by the clerk
of the court, under the seal thereof. In all affidavits or depositions
witness should speak in the first person.
Allens, Any alien who is a bona fide resident of the United States,
or who has declared his intention to become a citizen, or whose rights
are secured by treaty, may acquire and hold lands upon the same terms
as a citizen. Any alien may acquire lands by inheritance or in the
ordinary course of justice in the collection of debts, and may acquire
and enforce liens upon lands, but such lands must be sold within ten
years. Any alien may also acquire and hold lots or parcels of land
in any incorporated or platted city, town, or village, or in any mine
or mining claim, but is not authorized to acquire title from the United
States to any of the public lands.
Arrest. The defendant may be arrested In the following civil
actions: 1. For the recovery of money or damages when the de­
fendant is about to remove from the district with intent to defraud
his creditors; for an Injury to person; or for willfully Injuring or wrong­
fully taking, detaining, or converting property. 2. For a fine or
penalty: or for money or property embezzled or fraudulently mis­
applied or converted to his own use by a public officer, or by an attor­
ney. or by an officer or agent of a corporation in the course of his
employment as such, or by any agent, broker, or other person in a
fiduciary capacity or for misconduct or neglect In office or in a profes­
sional employment. 3. To recover the possession of personal
property unjustly detained, when the property or any part thereof
has been concealed, removed, or disposed of. so that it cannot be
found or taken by the marshal, and with intent that it should not be
so found or taken, or with the intent to deprive the plaintiff of the
benefit thereof. 4. When the defendant has been guilty of fraud in
contracting a debt, or incurring the obligation for which the action is
brought, or in concealing or disposing of the property for the taking
detention, or conversion of which the action is brought. 5. When
the defendant has removed or disposed of his property, or is about to
do so. with intent to defraud his creditors.
Attachment. The plaintiff, at the time of issuing the summons
or afterwards, may have the property of defendant attached in an
action upon a contract, express or implied, for the direct payment of
money, and, 1, which is not secured by mortgage, lien, or pledge upon
real or personal property, or if so secured, when the security has been
rendered nugatory by the act of the defendant; or, 2, against a non­
resident defendant. The writ issues whenever the plaintiff, or any­
one In his behalf, files an affidavit showing that defendant is indebted
to plaintiff (specifying the amount of indebtedness over and above all
legal set-offs or counter-claims) upon a contract, express or implied,
for the direct payment of money; that the payment has not been
secured by mortgage, lien, or pledge upon real or personal property;
and that the sum for which attachment is asked Is an actual, bona fide
existing debt due and owing from plaintiff to defendant: and that the
attachment is not sought nor the action prosecuted to hinder, delay
or defraud any creditor of the defendant. Plaintiff must also file an
undertaking, with one or more sureties, in a sum not less than $100
and equal to the amount for which he demands judgment, conditioned
that plaintiff will pay all costs adjudged and all damages sustained
by reason of the attachment if the same be wrongful or without suffi­
cient cause, not exceeding the amount specified.
Chattel Mortgages. Any interest in personal property, capable
of being transferred, may be mortgaged; but the mortgage is void as
against creditors and subsequent purchasers and incumbrancers in
good faith and for value, unless possession of the property be delivered
to and retained by the mortgager or the mortgage provide that the
property may remain in the possession of the mortgagor and be ac­
companied by the affidavit of all the parties thereto that the same is
made in good faith to secure the amount named therein, and without
design to hinder, delay, or defraud creditors, and be acknowledged
and filed. The mortgage must be acknowledged by the mortgagor
as a conveyance of real property is and be filed in the office of the
recorder of the precinct where the mortgagor resides and of the pre­
cinct where the property is. Within thirty days next preceding the
expiration of one year from the filing, a true copy of the mortgage
with a verified statement of the interest of the mortgagee in the prop­
erty at the time the same is renewed, must be filed in the office where
the original was filed, and the lien is thereby extended another year.
Chattel mortgages are foreclosed in the same manner as mortgages
and liens upon real property, but a clause may be inserted in a mortgage
authorizing the marshal to execute the power of sale therein granted
to the mortgagee.
Corporations. Domestic Corporations. Three or more adult per­
sons may form a stock corporation for any lawful purpose, whose
chief business shall be in the territory, except for purposes of banking,
insurance, brokerage, or loan, trust and guaranty associations. At
least one director must be a resident of Alaska.
Foreign Corporations. Every corporation or joint stock company
organized under the laws of the United States or any state or territory
shall, before doing business within the district, file in the office of the
secretary of the district and in the office of the clerk of the district
court for the division wherein it intends to carry on business a duly
authenticated copy of its charter or articles of incorporation, and of
any amendments thereto, and also a financial statement, giving
certain statutory information, verified by the oath of its president
and secretary and attested by a majority of its board of directors.
Thereafter such statement must also be so filed within sixty days after
January first of each year. The corporation must also file in the same
offices the appointment and consent of a resident of Alaska upon whom
service of statutory process may be made.
Deeds. A conveyance of lands, or of any estate or interest therein,
may be made by deed, signed and sealed by the person from whom
the estate or interest is Intended to pass, and acknowledged or proved,
and recorded, without any other act or ceremony. A quit-claim deed
passes all the estate which the grantor could convey by deed of bargain

2136

BANKING AND COMMERCIAL LAWS—ALASKA

and sale. No covenants are implied in any conveyance. The term
"heirs.” or other words of inheritance are not necessary to create or
convey an estate in fee simple. Wife may convey her lands without
joinder of husband. Within the district deeds must be executed in
the presence of two witnesses, who shall subscribe their names as
such: and the person executing a deed may acknowledge the execu­
tion before a judge, clerk of the district court, notary public, or com­
missioner within the district, and the officer taking the acknowledg­
ment must indorse thereon a certificate of acknowledgment and the
true date of making the same under his hand.
Depositions. The testimony of a witness, in the district, may be
taken by deposition, in an action, at any time after the service of
the summons or the appearance of the defendant, and in a special
proceeding after a question of fact has arisen, when, 1, the witness is
a party to the action or proceeding, by the opposite party; 2, the
witness's residence is more than one hundred miles from the place of
trial; 3, the witness is about to go more than one hundred miles beyond
the place of trial; 4, the witness is too infirm to attend the trial; or, 5,
the testimony is required upon a motion, or in any other case where
the oral examination of the witness is not required.
The testimony of a witness, out of the district, may be taken by
deposition, by commission issued, upon eight days' notice to the otner
party, by the clerk of the court, or justice of the peace in a cause in his
own court, to a person agreed upon by the parties, or, if they do not
agree, to a judge, justice of the peace, notary public, or clerk of a
court selected by the officer issuing the commission.
The amount of the commissioner’s fees should be indorsed upon the
deposition.
Descent and Distribution. The real property of an intestate
descends in equal share to children and to the issue of any deceased
by right of representation; and if there be no child of intestate living
at the time of his or her death, to all his or her other lineal descendants;
and if all such descendants are in the same degree of kindred to the
intestate, they take equally; otherwise, by representation. 2. If
intestate leave no lineal descendants, to his wife; or if intestate be
a married woman, to her husband; and if intestate leave no wife nor
husband, to the parents equally or the survivor. 3. If intestate
leave no lineal descendants, neither husband nor wife, nor parents,
such real property descends in equal shares to his brothers and sisters,
and to the issue of any deceased brother or sister by right of repre­
sentation. 4. If intestate leave no lineal descendants, nor father,
brother, nor sister, living at time of his or her death then real property
descends to mother, to exclusion of issue of any deceased brothers
or sisters. 5. If intestate leave no lineal descendants, neither hus­
band nor wife, nor father, mother, brother, nor sister, such real
property descends to his next of kin in equal degree, excepting that
when there are two or more collateral kindred in equal degree but
claiming through different ancestors, those who claim through the
nearest ancestor are preferred. 0. If intestate leave one or more
children, and the issue of one or more deceased children, and any
of such surviving children due under age without having been mar­
ried, all such real property that came to such deceased child by
inheritance from such intestate descends in equal shares to the other
children of such intestate and to the issue of any other children who
have died, by right of representation. But if all the other children
of intestate be dead, and any or them have left issue, such real prop­
erty so inherited by such deceased child descends to all the issue of
such other children of the intestate in equal shares, if they are in the
same degree of kindred to such deceased child; otherwise, they
take bv right of representation. 7. If intestate leave no lineal
descendants or kindred, such real property escheats to the territory
of Alaska. Personal property same as real property except (1) apparel
and ornaments to widow (2) payment of debts (3) same as real prop­
erty except (a) if husband and issue, half to husband; if no issue,
ail to husband; (b) if widow and issue, half to widow; if no issue,
all to widow; (5) if no husband, widow or kindred, all escheats to
territory.
Dower and Curtesy. The widow of every deceased person is
entitled to dower, or the use during her natural life of one-tnird part
in value of all the lands whereof her husband died seized of an estate
of inheritance.
When wife dies seized of any estate of inheritance in lands, the
husband, on the death of his wife, holds for his life as tenant thereof
by the curtesy all such lands not previously sold or conveyed by the
wife, although such husband and wife may not have had issue born
alive.
Evidence. No person may be excluded as a witness on account of
being a party or interested In the event of an action or proceedings,
having been convicted of a crime, or his opinions on matters of religious
belief. Persons of unsound mind and children under ten years of age
who appear incapable of receiving just impressions of the fact respect­
ing which they are examined or of relating them truly may not be
witnesses. An attorney may not, without his client’s consent, be
examined as to communications made by his client to him or his advice
thereon. A priest may not, without the consent of the person making
the confession, be examined as to any confession made to him in his
professional capacity, in the course of discipline enjoined by the church
to which he belongs. A physician or surgeon may not, against the
abjection of bis patient, be examined, in a civil action, or proceeding,
as to information acquired in attending the patient which was neces­
sary to enable him to prescribe or act.
Executions. (See Judgment and Execution.)
Executors and Administrators. When a will is proven letters
testamentary are issued to the persons therein named as executors,
or to such of them as give notice of their acceptance of the trust and
are qualified. Administration is granted as follows: 1. To the widow
or next of kin, or both, in the discretion of the court; 2. To one or
more of the principal creditors; or, 3, to any other person competent
and qualified whom the court may select. If deceased were a married
woman administration shall in any case be granted to the husband;
if qualified, and he apply therefor within thirty days. Claims are
paid in the following order: 1. Funeral charges. 2. Taxes due the
United States. 3. Expenses of last sickness. 4. All other taxes.
5. Debts preferred by the laws of the United States. G. Debts which
at the death of the deceased were a lien upon his property, in the
order of the priority of the liens. 7. Debts due for wages earned
within ninety days immediately preceding death of decedent. 8. All
other claims.
Exemptions. 1. Earnings to amount of $100 of judgment debtor,
for personal services rendered within thirty days next preceding the
levy of execution or attachment, when necessary for the use of his
family supported in whole or in part by his labor. 2. Books, pictures,
and musical instruments owned by any person, to the value of $75.
3. Necessary wearing apparel owned by any person for the use of
himself or family, but watches or jewelry exceeding $100 in value
are not exempt. 4. The tools, implements, apparatus, team, vehicle,
harness, or library necessary to enable any person to carry on the
trade, occupation, or profession by which such person habitually
earns his living, to the value of $500; also sufficient quantity of food
to support such team, if any, for six months; the word "team” being
construed to include not more than one yoke of oxen, or a span of
horses or mules, or two reindeer, or six dogs. 5. The following prop­
erty, if owned by the head of a family and in actual use or kept for
use by and for his family, or when being removed from one habitation
to another on a change of residence: Ten sheep, with one year’s fleece
or the yarn or cloth manufactured therefrom; two cows and five
swine; household goods, furniture, and utensils to the value of $300;
also food sufficient to support such animals, if any, for six months,
and provisions actually provided for family use and necessary for the
support of such person and family for six months. 6. The seat or
pew occupied by the head of a family or his family in a place of public
worship. 7. All property of any public or municipal corporation.
No article, or the proceeds derived from its sale or exchange, is exempt
from execution on a judgment recovered for its price
Garnishment. (See Attachment.)


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Federal Reserve Bank of St. Louis

Holidays. The law concerning legal holidays in the Territory
has been amended to read as follows:
The following days are legal holidays, namely: Sunday, the first
day of January, commonly called New Year's Day; the 12th day of
February, commonly called Lincoln's Birthday; the 22nd day of
February, commonly called Washington's Birthday; the 30th day
of March, to be called Seward's Day in commemoration of the sign­
ing of the Treaty, ceding Alaska to the United States; the 4th day
of July, commonly called Independence Day; the first Monday in
September, commonly called Labor Day; the 18th day of October,
commonly called Alaska Day; the 25th day of December, commonly
called Christmas Day; and any day designated by public proclama­
tion by the President of the United States or the Governor of the
Territory of Alaska, as a legal holiday, or as a day of Thanksgiving;
the day known and observed as Memorial or Decoration Day and the
day on which a general election is held throughout the Territory
of Alaska.
Homestead. The homestead of any family, or the proceeds
thereof, is exempt. Such homestead must be the actual abode of,
and owned by, such family or some member thereof, and not exceed
$2,500 in value nor exceed 160 acres in extent, if not located in a town
or city laid off into blocks or lots; or if located in any such town or
city, one-fourth of an acre. This exemption does not apply to decrees
for the foreclosure of any mortgage property executed; but if the
owners of such homestead be married, the mortgage must be executed
by husband and wife.
Interest. The legal rate of interest is 8 per cent, but on contract
interest at the rate of 12 per cent may be charged by express agree­
ment of the parties. If usurious interest has been received or collected
the party paying the same, or his legal representatives, may, by action
brought within two years, recover double the amount of such interest.
If it is ascertained in any action upon contract that an unauthorized
rate of interest has been contracted for. judgment must be rendered
against the defendant for the amount due, without interest, and
against the plaintiff for costs. If the rate contracted for is 8 per
cent or less, the debtor may also agree to pay the taxes upon the
debt, credit, or mortgage.
Judgment and Execution. A judgment is docketed imme­
diately after entry. At any time thereafter while execution may
issue a certified transcript of the docket may be filed in the office
of the recorder of any recording district, and from the date of docket­
ing a judgment or transcript thereof the judgment is a lien upon
all the real property of the defendant within the recording district
or districts where docketed, or which he may afterwards acquire
therein during the time an execution may issue. If no execution
Issues within ten years the lien expires, but is renewed if afterwards
leave is given to issue execution and a transcript of the docket of
the order docketed with the recorder.
Execution may issue at any time within five years from the entry
of the judgment, and thereafter on order of the court made on motion
of the party in whose favor the judgment was given. Such motioD
must be subscribed and verified as a complaint, and summons must
be served upon the judgment debtor or his representatives, to which
he or they may demur or answer. The order made must be dock­
eted as a judgment. Execution may be against the property of the
judgment debtor, his person, or for the delivery of the possession
of real or personal property, or such delivery with damages. Execu­
tion from the district court is returnable within sixty days; from the
commissioner’s court within thirty days. Until a levy property is
not affected by the execution.
Licenses. (See Taxes.)
Liens. Every mechanic, artisan, machinist, builder, contractor,
lumber merchant, laborer, teamster, drayman, and other person
performing labor upon or furnishing material of any kind to be used
In the construction, development, alteration, or repair, either in whole
or in part, of any building, wharf, bridge, flume, ditch, mine, tunnel,
fence, machinery, or aqueduct, or any structure or superstructure,
has a lien upon the same for the work or labor done or material fur­
nished at the instance of the owner of the building or other improve­
ment or his agent; and every contractor, sub-contractor, architect,
builder, or other person having charge of the work, in whole or in
part, is, for this purpose, deemed the agent of the owner.
Statutory liens given to: (a) person who makes, alters, repairs, or
bestows labor on any article of personalty at request of owner or lawful
possessor; (b) person who is a common carrier or who shall, at request
of owner or lawful possessor, carry, convey, or transport personalty
from one place to another; (c) any person who shall safely keep or
store any grain, wares, merchandise, and personalty at request of
owner or lawful possessor; (d) any person who shall pasture or feed
any horses, cattle, hogs, sheep or other live stock, or bestow any labor,
care or attention upon them, at request of owner or lawful possession;
(e) laborers and loggers for labor on or in assisting to obtain any sawlogs, spars, piles, cordwood, fuelwood, shingle bolts, or other timer;
(f) laborers, material men and contractors for work, labor and materials
for the construction altering, digging, drilling, boring, operating,
completing or repairing of gas wells, oil wells, or other wells, gas pipe
lines or oil pipe lines; (g) laborers and material men for labor or
materials furnished that contribute to the preparation of fish or
aquatic animals for food, fish meal, fertilizer, oil or other article of
commerce; (h) laborers, miners and watchmen for labor and work in,
on or about mines and mining property.
Limitations. Civil actions must be commenced within the
following periods after the cause of action accrued: Within ten
years—action for the recovery of real property, or the possession
thereof; upon a judgment or decree of any court of the United States,
or of any state or territory within the United States; upon a sealed
Instrument. Within six years—action upon a contract or liability,
express or implied, except judgment or sealed instrument; upon a
liability created by statute, other than a penalty or forfeiture; for
waste or trespass upon real property; for taking, detaining, or injuring
personal property, including an action for the specific recovery thereof.
Within three years—action against a marshal, coroner, or constable,
upon a liability incurred by the doing of an act in his official capacity
or in virtue of his office, or by the omission of an official duty, including
the non-payment of money collected upon execution, but not an
action for an escape; action upon a statute for penalty or forfeiture,
where the action is given to the party aggrieved, or to such party
and the United States, except the statute prescribe a different limita­
tion. Within two years—action for libel, slander, assault, battery,
seduction, false imprisonment, or for any injury to the person or
rights of another not arising on contract; upon a statute for a for­
feiture of penalty to the United States. Within one year—action
against the marshal or other officer for the escape of a person arrested
or imprisoned on civil process: upon a statute for the penalty given
In whole or in part to the person who will prosecute, but if not com­
menced within one year by private party may be within two years
by the United States.
Married Women. The property and pecuniary rights of every
married woman at the time of marriage, or afterwards acquired
by gift, devise, or inheritance, or by her own labor, are not subject
to the debts or contracts of her husband, and she may manage, sell,
convey, or devise the same by will to the same extent and in the
same manner that her husband can property belonging to him. For
civil injuries damages may be recovered from a married woman
alone, and her husband is not responsible therefor. Contracts may
be made by a wife, and liabilities incurred, and the same enforced
by or against her to the same extent and in the same manner as if
she were unmarried. All laws which impose or recognize civil disa­
bilities upon a wife which do not exist as to the husband are repealed.
Wife may record list of her personal property and such list is prima
facie evidence of her separate ownership, and property not so registered

BANKING AND COMMERCIAL LAWS—ARIZONA
Is deemed prima facie the property of the husband. Neither husband
nor wife is liable for the debts or liabilities of the other incurred
before marriage. Husband and wife may make conveyances and
transfers and create liens between themselves, and either may con­
stitute the other his or her attorney in fact. A woman becomes of
age at twenty-one or upon being married according to law.
Mortgages. Mortgages are executed, acknowledged, and recorded
In the same manner as deeds. No covenant is implied for the pay­
ment of the sum intended to be secured. Record of assignment is
not notice to the mortgagor, his heirs, or personal representatives.
Mortgage may be discharged by entry in margin of record signed by
mortgagee or his personal representative or assignee and witnessed
by the commissioner or deputy, or by certificate executed and ac­
knowledged as other conveyances. Foreclosure is by action of an
equitable nature in which a deficiency judgment may be had.
Notes and 15ills of Exchange. Uniform negotiable instruments
act is in effect.
Records. An unrecorded conveyance of real property is void
as against any subsequent innocent purchaser in good faith and for
a valuable consideration whose conveyance is first duly recorded.
A commissioner is ex-officio recorder of a recording district, the
boundaries of which are fixed by the court. Conveyances of lands
not in any recording district are recorded with the clerk of that divi­
sion of the district court within the limits of which such lands are
situated.
Replevin. The plaintiff, at any time after the commencement
of an action to recover the possession of personal property and before
Judgment, may claim the immediate delivery of such property upon
filing an affidavit showing that he is the owner of the same or entitled
to the possession thereof; that the property is unlawfully detained
by defendant; the alleged cause of detention; that the same has not
been taken for a tax assessment or fine, pursuant to a statute, or
seized under an execution or attachment against the property of
the plaintiff; or, if so seized, that it is exempt; and the actual value
of the property.
Service. (See Actions.)
Supplementary Proceedings. (See Judgment and Execution.)
Taxes. No general property tax except in Municipal corporations,
but both the United States and the territory levy and collect license
taxes upon occupations and businesses, the amount of which differs
on the several different occupations and businesses.
Uniform laws: Negotiable instruments act; bills of lading act;
air licensing act; general partnership act; limited partnership act;
foreign acknowledgements act; sales act; stock transfer act; warehouse
receipt act; conditional sales act.
Wills. Every person of twenty-one years of age, of sound mind,
may dispose of all his or her property by will, saving a widow’s dower
and a husband’s rights as tenant by the curtesy. Will must be in
writing, signed by the testator, or under his direction, in his presence,
and attested bv two or more competent witnesses subscribing their
names in the presence of the testator provided that olographic wills,
with or without attestation, shall be admitted to probate the same as
other wills and proved the same as other private writings. "Will”
includes “ Codicils.” A will by an unmarried person is revoked by
his subsequent marriage. Children or descendants of children not
named or provided for in the will take as if testator had died intestate.
A mariner at sea or soldier in military service may dispose of his
personal property as at common law. Proof of nuncupative will
must be made within six months, and the words or their substance
reduced to writing within thirty days after they are spoken. A person
owning property in, but not an inhabitant of, the district may devise
or bequeath the same according to the laws of his domicile. If such
will be probated without the district, copies of the will and the probate
thereof, certified by the clerk of the court in which it was probated,
with the seal of the court affixed thereto, if there be a seal together
with a certificate of the chief judge or presiding magistrate, that the
certificate is in due form, and made by the clerk or other person having
the legal custody of the record, may be recorded, admitted in evidence,
or contested and annulled as if executed and proved within the district.

SYNOPSIS OF

THE LAWS OF ARIZONA
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by C. B. Wilson, Attorney at Law, Flagstaff, Arizona.
(See Card in Attorneys List)
Accounts. When stated draw interest; when action is upon open
account and affidavit of party, his agent or attorney, is attached,
stating that such “account is within affiant’s knowledge, just and true,
that it is due, and that all just and lawful offsets, payments and credits
have been allowed,” Is prima facie evidence, unless at least one day
before trial, defendant files written denial of any item under oath.
Acknowledgments. The form of an ordinary certificate of ac­
knowledgment shall be substantially as follows:
" State of Arizona,
1 __
County of.................................................................................... J 88
This Instrument was acknowledged before me this................day
of.....................A. D......................... by (if by a natural person or persons
here insert name or names; if by a person acting in a representative
or official capacity, or as attorney in fact, then insert name of person
as executor, attorney in fact, or other capacity; if by an officer or
officers of a corporation, then insert name or names of such officer
or officers as the president or other officer of such corporation, naming
Notary Public.
(Or other officer)
(My commission expires........................................... ) ”
Every instrument affecting real property in this state executed,
acknowledged and certified in any other state or territory in accord­
ance with the laws of such state or territory, shall be valid and en­
titled to record as if executed in accordance with the laws of this
state.
Actions. Distinction In forms between law and equity are abol­
ished. Pleadings are: Complaint and answer, and in some cases a
reply.
Administration of Estates. Lie in Superior Court. No public
administrator. Where person dies intestate letters shall issue.
Affidavits. May be taken before any officer authorized to take
acknowledgments.


1 15
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Federal Reserve Bank of St. Louis

2137

Aliens. Unless rights are secured by treaty cannot hold land In
the state, may acquire by inheritance, or in ordinary course of jus­
tice in the collection of debts; may acquire liens on real estate, may
lend money and secure same on real estate, but title so acquired must
be sold within five years: may acquire patented mines and hold
stock in domestic corporation owning unpatented mines.
The laws provide that the laws of the state pertaining to aliens
shall not be construed as to conflict in any manner with any rights
existing under and by virtue of any treaty of the United States with
any other country.
Appeals. Appeals are allowed from justice of peace to superior
court in certain cases and from superior court to supreme court,
except in actions of forcible entry and detainer where rental value
of property is less than $300 per year.
Arbitration. There are statutory provisions which are not
exclusive of the common law arbitration.
Arrest. Abolished in civil cases, debtor fraudulently removing
Property out of territory or concealing it may be prosecuted criminally.
Attachment. Writ will issue on affidavit showing: 1. That de­
fendant is indebted to plaintiff upon a contract, express or implied;
for the direct payment of money and that such contract was made
or is payable In this State, and that the payment of same has not
been fully secured by mortgage or lien upon real or personal property,
or pledge of personal property, or if originally so secured, that such
security has, without any act of plaintiff or the person to whom the
security was given, became valueless, and shall specify the character
of the indebtedness, that the same is due to the plaintiff over and
above all legal set-offs or counter-claims, and that demand has been
made for the payment of amount due: or 2 That defendant is indebted
to plaintiff, stating amount and character of debt: that same is due
and payable over and above all legal set-offs and counter-claims, and
that defendant is a non-resident of this State or is a foreign corporation
doing business in this State; or 3. That the action is brought upon a
judgment of another State or territory of the United States, or of the
District of Columbia; or 4. That an action is pending between the
parties, and that defendant is about to remove his property beyond tha
jurisdiction of the court to avoid payment of judgment: and 5. That
the attachment is not sought for a wrongful or malicious purpose, and
that the action is not prosecuted to hinder or delay any creditor of
defendant. No such attachment shall issue until suit has been duly
instituted, but it may be issued in a proper case either at the com­
mencement of the suit or at any time during its progress. The writ
may issue, although plaintiff’s debt or demand be not due and under
specified facts of intent to defraud; no final judgment shall be rendered
until such debt or demand shall become due. Writ may issue at or
after action began upon plaintiff or some one in his behalf filing the
affidavit, and upon filing a bond with two sureties in an amount equal
to amount sued for. Sureties can be compelled to justify upon
notice. When more than one attachment is levied on same property
writs take priority according to time of levy. (See Liens, Garnish­
ment.)
Banks—Savings and Loan. May be incorporated to loan and
invest property. May hold lot and building in which business is
carried on, may hold for period of five years such real estate as it
may accumulate on good faith loans and such personal property as
may be required in transacting its business. Married women and
minors may transact business with such banks. Are required to
have license and are examined by the bank examiner. Provisions are
made for the contents of the charter.
Bills and Notes. The negotiable instrument code adopted by the
American Bar Association is in force. Joint obligor may be released
without releasing others. (See Holdings.)
Bonds. Any standard surety company, organized under laws of
United States or of any state, may execute bonds in judicial proceed­
ings within the state when they have complied with license laws.
(See Guaranty Companies.)
Chattel Mortgage. To be valid against others than the parties
thereto, chattel mortgage must set out the residence of the mortgagor
and the mortgagee, the sum to be secured, the rate of interest to be
paid and time and place of payment of the debt secured, and be
accompanied by the affidavit of both mortgagor and mortgagee that
the mortgage fs bona fide and made without design to defraud or
delay creditors. Void as against creditors of mortgagor and subse­
quent purchasers, mortgagees or lien holders in good faith unless
immediate delivery of the mortgaged property is made to the mort­
gagee and the change of possession is actual and continued, unless the
mortgage or a true copy thereof shall be forthwith deposited and filed
in the office of the recorder of the county where the property shall
then be situated. Removal sale, or other disposition of mortgaged
property without consent of mortgagee entitles mortgagee to imme­
diate possession of it, and such removal, transfer, or sale, or subsequent
encumbrance is felony. If mortgagee permits mortgaged property to
be removed to another county, he shall within one month record his
mortgage in such other county. Chattel mortgage may be fore­
closed by notice and sale or by proceedings in superior court. Mort­
gagee may obtain possession of property on default and sell after
notice which must be served on owner. After notice mortgagor may
contest as to amount due and right to foreclose and have procedings
transferred to superior court. Upon stock of goods, wares, and
merchandise with continued possession in mortgagor, void. If copy
is filed with recorder, original must be acknowledged, and copy
certified to by county recorder.
Claim and Delivery. (See Replevin.)
Collaterals. No statutory provisions—common law prevails.
Community Property. (See Conveyances.)
Conditional Sales. Where title remains in vendor until purchase
price is paid, void as to persons not parties thereto, and persons
without notice, unless subscribed, and filed with county recorder.
Contracts. (See Bills and Notes.) One or more obligors on a
Joint or joint and several instrument may be released without releasing
the others, and may be sued separately under certain conditions with­
out releasing the others. Married women may contract as if sole.
Conveyances. Conveyances of estate In lands for term more than
one year shall be by instrument In writing subscribed by party making
It, or his agent, duly authorized thereto by writing. A conveyance is
not effectual against creditors or bona fide purchasers unless recorded
In recorder’s office in county where land is situate. A conveyance
purporting to convey a greater estate than the grantor has passes only
the estate that he actually has. A general grant or devise passes the
fee unless expressly limited to a less estate. All deeds to community
realty must be signed by both husband and wife except as to un­
patented mining claims. Deeds must be signed and must be ac­
knowledged before some officer authorized to take acknowledgment,
and properly certified by him to entitle same to registration. The use
of the word “grant" or “convey” implies the following covenants and
none other
1. That previous to the time of the execution of the
conveyance the grantor has not conveyed the same estate, or any
right, title or interest therein, to any person other than the grantee.
2. That such estate is at the time of the execution of such conveyance
free from incumbrances. Married women 21 years of age and upward
may convey their own lands without being joined by their husbands.
(See Acknowledgment, Dower, Husband and Wife, Homestead.)
Corporation Commission, organized under Chapter 90, First
Session. Laws 1912. Has general supervision of corporations.
Corporations in General. Any number of persons may become
incorporated for the transaction of any lawful business. Before com­
mencing any business, they must adopt articles of incorporation
which shall be signed and acknowledged by them as deeds and be
filed in the office of the Corporation commission at the State Capital
and a certified copy thereof filed In the office of the County Recorder.

2138

BANKING AND COMMERCIAL LAWS—ARIZONA

In each county in the state in which they transact business. The
articles of incorporation must contain: 1. The name, residence and
Post Office address of incorporators, the name of the corporation,
which name shall indicate the character of business to be conducted,
and its principal place of transacting business. 2. The general
nature of the business proposed to be transacted. 3. The amount of
capital stock authorized and the times when and conditions upon
which it is to be paid in stock without par value may be issued. 4.
The time of the commencement and termination of the corporation.
5. By what officers or persons the affairs of the corporation are to be
conducted, and the times at which they are to be elected. 6. The
highest amount of indebtedness or liability to which the corporation
is at any time to subject itself, which must not exceed two-thirds of
its capital stock. 7. Whether private property is to be exempt from
corporate debts. Unless so exempted stockholders are liable for the
debts of the corporation in the proportion which their stock bears to
the whole capital stock. Must be published for six times in some
newspaper in the county where the principal business is located.
Proof of publication must be filed with the Corporation Commission.
Corporations to endure for twenty-five years. Corporation must file
in office of Corporation Commission an appointment of agent who is
a bona-fide resident of this state for three years prior thereto, on
whom all notices and process including summons, may be served and
constitutes personal service. Charges for incorporation. Recorder’s
fees, 20 cents folio. Recorders fees, certified copy, 20 cents folio.
Recorder’s fees certificate to copy, 75 cents. Corporation Commis­
sion's fees, filing cost copy, $10. Certificate of filing Articles of In­
corporation $5.00. Certificate of incorporation $10.00. Corporation
Commission’s fees, filing appointment of agent, $5.00. Where charter
provides assessments may be levied on shares to par value.
Corporations, Foreign. Before it can transact business it must
file certified and duly authenticated copy of Articles with Corporation
Commission and also an appointment of agent upon whom a service
personal to the corporation may be made in each county in which it
transacts business. Publish its Articles of Incorporation and file
affidavit thereof as required of domestic corporations. Pay license
fee of $15.00.
Corporations, Insurance. May be organized under provision
peculiarly applicable to insurance companies.
Corporations, Railroad. Are organized under a statute espe­
cially providing for them.
Corporations. Savings and Loan. (See Banks and Banking.)
Corporation Stock, Transfer of. Transfer of stock shall not be
valid, except as between the parties thereto, until the same is regularly
entered upon the books of the company, so as to show the names of the
person by whom and to whom the transfer is made; the number of their
designation of the shares, and the date of the transfer.
Costs. Plaintiffs who are non-residents, or those who own no
property upon which execution may be levied, are required to give
security for, within ten days after order made; bonds for, must
authorize judgment to be entered against sureties.
Courts. Are the Supreme Court of the State, the U. S. district court
for the District of Arizona; one superior court for each County, except
in counties having over certain population in which event two superior
courts, justices of the peace, police courts, recorders of cities. The
superior court of the several counties is a court of general jurisdiction,
both civil and criminal. It has both original and appellate jurisdiction.
Its original jurisdiction extends to all civil cases where the amount
Involved exceeds $200 exclusive of interest, and in all cases involving
the title to or possession of real estate. Justice courts have general
jurisdiction when amount in controversy does not exceed $200.00,
except when title to real estate is involved. (See Jurisdiction.)
Creditors’ Bills. No statutory provisions.
Days ol Grace. None.
Depositions. May now be taken either upon oral examination,
and cross-examination or upon written interrogatories and cross
interrogatories, as is generally provided.
Descent and Distribution. The law of community property
prevails. Upon the death of husband or wife intestate, one-half of
the community property goes to the survivor and the other half
goes to his or her descendants. In the absence of such descendants
the entire community estate goes to the survivor.
The interest of
either spouse in the community is subject to testimentary disposition.
The entire community estate is charged with debts against it.
The separate estate of intestate shall descend as follows: Personal
Property: one-third to the surviving spouse and the remaining twothirds to descendants. In absence of such descendants the entire
personal estate goes to surviving spouse.
Real Estate. Estate for life in one-third with remainder to de­
scendants. If no descendants one-half to surviving spouse and the
other one-half shall pass according to rule of descent and distribution;
provided that if the intestate leaves neither father nor mother, then
the surviving spouse shall be entitled to the whole of such real estate.
If no husband or wife survive intestate, the separate property shall
pass as follows: 1. to children of intestate and his or her descendants.
2. If no such children or descendants then to father and mother in
equal proportions. If only one parent survives, then one-half will
pass to such parent and the other half to brothers and sisters of
Intestate and their descendants. If no brothers or sisters, then the
whole estate shall pass to the surviving parent.
If no brothers or
sisters or parents then the inheritance shall divide into moites, one
of which shall go to the paternal grand parents and their descendants
and the other to the maternal grand parents and their descendants
(See Dower, Husband and Wife, Homestead).
Dower. Dower is abolished.
Evidence. The common law rules have not been codified. Parties
may be examined and the other side not concluded thereby. Statutes
of other states and territories purporting to be printed under authority
may be read. No one is incompetent to testify because of religious
belief. Certified copies of all records in state may be read. Certi­
fied copies of records of all notaries may be read. Court may order
Inspection or copy of documents.
Executions. Upon a judgment of superior court, executions may
be issued to any county. Lien of dates from levy, and if on real prop­
erty, the description is endorsed on execution and filed with county
recorder. A range levy may be made upon all of stock under a certain
brand in same manner as upon real estate. (See Judgment, Liens.)
Proceedings supplemental to execution—when returned unsatisfied
creditor is entitled to an order requiring debtor to answer concerning
his property, but not elsewhere than in the county of his residence.
Third parties may, upon affidavit, be required to surrender property.
Court or judge may order suit brought to determine the denial of
owning or of having property.
Exemptions. Every person who is the head of a family, and
whose family resides within this state, may hold as a homestead,
exempt from attachment, execution and forced sale, real property
to be selected by him or her. which homestead shall be in one com­
pact body, not to exceed in value four thousand dollars, upon filing
afflrtavit designating such homestead in the Office of the County
Recorder in county where property is situated. Such homestead
exempt from date of filing saia affidavit. The following property
shall be exempt from execution, attachment, and sale on any process
Issued from any court: 1. The family bible. 2. A seat or pew in
any house or place of public worship. 3. A lot in any burial ground.
4. Necessary household, table and kitchen furniture, including viz:
5. The tools or implements of a mechanic or artisan necessary to
carry on his trade, etc. 6. The sewing machine and implements
of a seamstress actually used in pursuing her vocation. 7. One
watch, one sewing machine, one typewriting machine, and one bi­
cycle. 7a. Five milch cows. 8. The camping outfit of every


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prospector in this state, including his mining tools, saddles and burros.
9. The farming utensils and implements of husbandry of the debtor,
etc. 10. Poultry not exceeding in value twenty-five dollars. 11.
Two horses and two mules and their harness; one cart or wagon;
one dray or truck: one coupe; one hack or carriage for one or two
horses or one automobile by the use of which a carman, drayman,
truckman, huckster, hackman, teamster, chauffeur, or other laborer
habitually earns his living, and one horse with vehicle or harness or
other equipment used by a surgeon, physician, constable or clergyman
in the legitimate practice of his profession, with food for such horses
or mules for one month. 12. Fuel necessary for the use of the
debtor and his family for the period of six months. 13. The presses,
stones, type, cases and other tools and implements used by any
person or copartnership in printing or publishing a newspaper or in
conducting any printing establishment or by any person hired to use
them; not exceeding two thousand dollars in value; together with
stock in trade not exceeding four hundred dollars in value. 14. The
library and philosophical and chemical or other apparatus belonging
to and used for the instruction of youth in any university, college,
seminary of learning or school. 15. All moneys received by or
payable to a surviving wife or child upon the life of a deceased husband
or father, not exceeding ten thousand dollars. 16. All moneys
arising from fire or other insurance upon any property exempt from
sale on execution. 17. All moneys, relief, or other benefits payable
to or to be rendered by any police department association, fire
department association, beneficiary association, or fraternal benefit
association, and any person entitled to assistance therefrom, or to
any certificate holder thereof or beneficiary under such certificate.
18. Any claim for damages recoverable by any person by reason
of any levy upon or sale under execution of his exempt personal
property or by reason of the wrongful taking or detention of such
property by any person, and any judgment recovered for such
damages. 19. The earnings of the minor child of any debtor or
the proceeds thereof by reason of any liability of such debtir not
contracted for the special benefit of such minor child. 20
One
half of the earnings of the wages or salary of any person for Lis per­
sonal services rendered at any time within thirty days next pre­
ceding the levy of attachment, garnishment or execution when it
appears by the affidavit of the debtor or otherwise that such earnings
are necessary for the use of the family residing in this state, supported
in whole or in part by him. 21. All arms, uniforms and accoutre­
ments required by law to be kept by any person, ana also one gun
to be selected by the debtor. 22. All fire engines........... of any fire
department. 23. All courthouses, jails, etc. The property de­
clared to be exempt by this chapter shall not be exempt from at­
tachment or sale in any action brought or judgment recovered for
the purchase price of such property so long as such property remains
in the possession of the original purchaser. (See Homestead, Liens.)
Frauds and Fraudulent Conveyances. Agreements must be in
writing and signed by the parties to be charged: 1. By an executor
or administrator to answer for the debt of his testator or intestate out
of his own estate. 2. By a person to answer for the debt, default or
miscarriage of another. 3. To charge any person upon an agreement
made upon consideration of marriage 4. For sale of real estate or
lease thereof for a term longer than one year. 5. Those which are
not to be performed within the space of one year after the making
thereof. 6. A contract to sell or a sale of any goods or choses in
action, of value of $500.00, or upwards, unless buyer accept and
actually receive the same or give something in earnest to bind the
contract. 7. An agreement authorizing or employing an agent or
broker to purchase or sell real estate, or mines, for compensation or
commission. 8. An agreement which is not to be performed during
lifetime of the promisor, or an agreement to devise or bequeath any
property, or to make any provision for any person by will. Every
gift, conveyance, or assignment, or transfer, or charge upon any
estate, real or personal; any suit commenced on decree, judgment, or
executions suffered or obtained, or any bond or other writing given
with intent to delay, hinder, or defraud creditors, purchasers or
other persons, shall to such persons be void. All bargains, sales,
and other conveyances of lands, tenements, and hereditaments,
deeds of settlement of marriage, deeds of trust, and mortgages, are
void as to creditors and subsequent purchasers, without notice,
unless properly recorded. The creditor must be a judgment creditor,
and notice must be prior to date of judgment lien. A judgment
creditor may be an innocent purchaser. Every gift, conveyance,
assignment, transfer or charge made by a debtor, which is not upon
consideration deemed valuable in law shall be void as to prior credi­
tors, if debtor had not then other property in the State sufficient
to pay all his indebtedness. Not on that account, however, void
as to subsequent creditors. No gift of any goods and chattels shall
be valid unless duly acknowledged, or proven and recorded, or by
will, or unless actual possession shall have come to and remained
with the donor or some one claiming under him. Fraudulent intent
is a question of fact and not of law. Conveyance shall not be adjudged
fraudulent merely because not for valuable consideration. If any
person shall do or transact business as a merchant or trader, with the
addition of the words agent, factor, company, or & Co., or words of
like significance or import, and shall fail to disclose the name of his
rincipa], or partner, or other person who may be interested in such
usiness by a sign in letters easy to read, placed conspicuously at the
lace where such business is transacted, or if any person shall transact
usiness in his own name, without any such addition, all the property,
stock, money and choses in action used or acquired in such business
except such property as may be exempt from execution, shall, as to
the creditors of any such person, be liable for his debts, and be, in all
respects, treated in favor of his creditors as his property. Criminal
prosecution for fraud is provided. (See Conditional Sale.)
Garnishment. Writ may issue: 1. Where writ of attachment
has issued. 2. Upon affidavit that the debt is just due, and unpaid,
and that defendant has not, within affiant’s knowledge, property in
his possession subject to execution sufficient to satisfy such debt, and
that the writ is not sued out to injure either the defendant or garnishee.
3. Upon judgment, when affiant makes affidavit that the defendant
has not, within his knowledge, property in his possession within this
State sufficient to satisfy said judgment. Proceedings under sub­
division 2 requires a bond in double the amount of the debt, condi­
tioned that plaintiff will prosecute the suit to effect, and pay all
damages and costs that may be adjudged against him for wrongfully
suing out the garnishment. The proceedings are docketed and judg­
ment rendered as if in an independent proceeding. (See Attachment.)
Holidays. Legal holidays are January 1, February 14, February
22, July 4, October 12, Thanksgiving, May 30, December 25, Arbor
Day, Labor Day, November 11, every Sunday and general election
day, Any promissory note, bank check, bill of exchange, acceptance, or
other negotiable instrument, made payable at any future period, which
falls due on any of these days mentioned, shall be considered due and
collectible on the day following, and when any holiday shall fall upon
Sunday, then the Monday following shall be considered as a legal
holiday. Writs of injunctions, attachments, replevin, and pro­
hibition may be issued and served on.
Homestead. Deed to. must be signed by husband and wife. (See
Exemptions.)
Husband and Wife. All property, both real and personal, of
the husband or wife, owned or claimed by him or her before mar­
riage, and that acquired afterward by gift, devise, or descent, as also
the increase, rents, issues, and profits of the same, shall be his or her
separate property. The earnings and accumulations of the wife and her
minor children in her custody while she has lived or may live separate
and apart from her husband, shall also be the separate property of the
wife. All property acquired by either husband or wife during the
marriage, except that which is acquired by gift, devise, or descent, or
earned by the wife and her minor children while she has lived or may

BANKING AND COMMERCIAL LAWS-ARKANSAS
live separate and apart from her husband, shall be deemed the common
property of the husband and wife, and during the coverture personal
property may be disposed of by the husband only. Married women
s
a*=>e °* twenty-one years and upwards shall have the same legal
rights as men of the age of twenty-one years and upwards, except the
right to make contracts binding the common property of the husband
and wife; and shall be subject to the same legal liabilities. (See
bower. Conveyance.)
Injunction. Is issued, where party is entitled to relief and
restraint, is required of some prejudicial act; where, pending litiga­
tion, an act is done which tends to render judgment ineffectual, and
when applicant is entitled under principles of equity. Under certain
conditions may be granted ex parte at chambers or by consent.
Bond may be fixed by judge and approved by clerk, except to restrain
collection of money judgment, when it must be double the amount of
such judgment.
Injuries—Personal. Workmen’s Compensation Act in force.
Insurance. (See special chapter pertaining to Insurance.)
Interest. May contract, in writing, for any rate of, not exceeding
10 per cent per annum. Any rate exceeding this is usurious. When
no express contract, on bond, bill, note, or instrument of writing
or judgment, for money lent, or due on settlement of accounts from
date of ascertained balance, and money received for use of another
Interest is computed at 6 per cent per annum.
Judgments. Judgments of superior courts become a lien upon all
real estate of judgment debtor in the county as soon as entered and
docketed. Upon filing with the clerk of the superior court a transcript
or judgment from justice court or of superior court of another county,
the same becomes a lien on all real estate of judgment debtor in the
county. No execution can be issued on any judgment after the
expiration of five years from the date of its rendition and entry, unless
such judgment be revived by scire facias or action for debt be brought
thereon within such five years.
Judicial Bonds. (See Bonds.)
Levy. (See Executions.)
Licenses. For gambling prohibited.
Liens. All persons who may labor or furnish materials in the con­
struction or repairing of any building, superstructure, canals, dams,
mines, or other improvement, or cuts cordwood. shall have a lien o»
the same, and in case of buildings and superstructures, on the lot of
land whereon the same is situate and connected therewith. To fix
and secure the lien, the person performing labor or furnishing material
iust, within sixty days after the completion of such labor or the fur­
nishing of materials, file his contract in the office of the county recorder
where the property is situate. If the contract be verbal, a duplicate
copy of the bill of particulars should be made, under oath, and one
delivered to the recorder and filed for record and the other furnished
the party owing the debt, or his agent. Laborers’ and like liens are
preferred to all subsequent liens, mortgages, and incumbrances, and
such as lien claimant had no notice. Suit to foreclose such liens must
becommenced within six months after filing the same in the recorder's
office. In case of the levy of writ of attachment or execution, clerks,
laborers, and employes of debtors have a preference claim for wages
£™~ervIco Performed sixty days before levy of writ, not exceeding
*200. upon filing notice of claim unpaid with creditor, debtor, and
officer executing writ. Proprietors of hotels, boarding houses, and
lodging houses have special lien on all property or baggage deposited
with them by guests for price of guests’ entertainment. Agister and
liveryman, garagemen, have lien by statute. (See Judgment, Mort­
gage.)
Limitations. To recover realty against person- in peaceable and
adverse possession under color of title, three years; against such posses­
sion where person pays taxes and has deed recorded, five years, otherwise ten years; to recover lots in city or village against person having
recorded deed, and pays taxes, five years; where party in possession
claims by right of possession only, two years. Personal Actions—
One year: Malicious prosecution, false imprisonment, libel, slander,
seduction, breach of promise. Action on liability created by statute,
other than a penalty or forfeiture must be brought within one year
from discovery of fraud. Two years: Personal injuries, trespass to
property, detention or conversion of personal property to own use
taking and carrying away goods and chattels; and injuries to person
where death ensues,to accrue from date of death. Three years:
Actions for debt not in writing; on stated or open accounts other
than mutual between merchants or their factors and agents; all
accounts, except as between merchants and factors and agents, limi­
tations run from date of each item of delivery. Actions for relief
on ground of fraud or mistake. Four years: For penalties or dam­
ages on any bond to convey real estate; between partners for settle­
ment of partnership accounts; on mutual or current accounts between
merchants, their factors or agents, to accrue from cessation of deal­
ings; upon judgment or instrument without the State; bonds of
executors, administrators, or guardian, after death, removal, etc.;
specific performance; to contest will after discovery of fraud; and
where no provision is otherwise made. Five years: On domestic
judgment where execution has been issued within one year after
rendition. Six years: debt evidenced by writing within the state.
Mines unpatented are real estate for the purpose of inheritance and
conveyance. Location requires seven monuments, three at each end
and one at discovery, in which notice is to be placed on discovery
title work consisting of a shaft 4x6x8 feet deep, or its equivalent
in an open cut so that mineral in place is discovered 8 feet from the
surface must be done and notice recorded within three months and
annual assessment work amounting to $100, maintained each year
thereafter, until patent is ordered.
Minors. (See Savings Banks.)
Mortgages. All mortgages of real property and all deeds of trust
m the nature of mortgages shall, notwithstanding any provision in the
mortgage or deed of trust, be foreclosed by action in a court of com­
petent jurisdiction. Failure of mortgagee to lawfully release a
satisfied mortgage for ten days after demand for the release, subjects
him to liability for $100 and actual damages. Mortgages on real
estate are executed, acknowledged and recorded as conveyances of
real estate. (See Conveyances, Chattel Mortgage, Acknowledgments
Redemption.)
Notary Public. In all certificates and acknowledgments the date
of expiration of commission must be stated, as "commission expires’’
Notary must reside in county for which appointed and has no juris­
diction outside of said county.
Notes and Bills of Exchange. (See Bills and Notes).
Partnerships using fictitious names must file with County Recorder
certificate showing names of partners and their residences, which
must be signed and acknowledged by all partners.
Powers of Attorney. No special statutory provisions relative to.
To confess judgment must be executed subsequent to maturity of debt
confessed, and must be acknowledged. To convey lands or release
mortgages should be acknowledged as deeds, and recorded.
Probate Law. (See Savings Banks and Administration of Estates.)
Protest. Liability of drawer or indorser of bill or note may be
fixed by regular protest and notice, etc., according to the usages and
custom of merchants. (See Bills and Notes.)
Records. The superior courts of each county are courts of record.
The recorders office in each county relates to titles of real estate
and personal property, and probate record instrument therein is
notice. The minutes of the Sanitary Live Stock Board are notice of
all brands and marks of live stock.
Redemptions. From Sheriff or judicial sales, six months, by
judgment debtor, or successors in interest. Senior creditor subsequent
to judgment having a lien on the premises sold, may redeed within
five days after expiration of said six months, and each subsequent
lien holder, according to priority of lien, within five da vs after time
allowed the prior lienholder, by filing with County Recorder statutory
notices of intention to redeem. The same rule applies to foreclosure
of mortgages and trust deeds. Redemption from tax sales 3 years.


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2139

Replevin. For possession of specific personal property which has
not been seized under any process, execution or attachment against
the property of the plaintiff.
Sales. The “uniform sales law” Is in force.
Seals. Addition or omission of seals or scrolls to instruments of
writing In no way affect the force and validity of the instrument.
Instruments executed by corporations must have a corporate seal
attached.
Service. All summons upon persons shall be personal, or by leaving
a copy with copy of complaint at the usual place of residence, of
defendant, with a member of his family over the age of sixteen years;
against incorporated city, or town, or village; upon major, clerk
secretary, or treasurer; against incorporation or joint stock associa­
tion, upon president, secretary, or treasurer, director or local agent
representing company, or by leaving a copy of summons and com­
plaint at the principal office during office hours; upon any railroad
telegraph, or express company or any agent of such company who
resides in or may be found in the county where suit is brought; upon
domestic corporation by serving on statutory resident agent, and where
there is no officer upon whom service can be made in the State ser­
vice may be had by delivering duplicate copies of summons and com­
plaint to the secretary of the Corporation Commission, and upon
foreign corporation by delivery to statutory agent. Personal service
of summons may also be had by serving upon defendant by registered
mail, as provided in statutes.
Suits. (See Actions.)
Taxes. Aside from those levied by legislative enactment for
specific purposes, as for the construction and maintenance of public
institutions, etc. State taxes are levied by the State Board of Equal­
ization; county taxes by the boards of supervisors of the several
counties, and city taxes by the common councils of the various cities.
Railroads are valued for the purpose of taxation by the State Board of
Equalization. Other property is valued by county assessors. The
assessing of value begins in January of each vear. The lien attaches
on the first Monday of January of each year. One-half of taxes become due and payable on first Monday in September and become
delinquent on the first Monday in November next thereafter. Re­
maining one-half become due and payable on first Monday in March
and become delinquent on first Monday in May next thereafter.
Ihe penalty for delinquency is 4 per cent added thereto and interest
from date of delinquency until paid at rate of 10 per cent per annum
County Treasurer shall advertise property for sale for delinquent
taxes in month of August following delinquency and sell the same
during the month of September.
Warehouses. Personal property in. may be sold for unpaid
cnargos.
Transfer of Corporation Stocks. (See Corporations.)
Wills. Wills must be in writing, signed by the testator, or by some­
one for him, in his presence and by his direction, and must be attested
by two or more credible witnesses above the age of fourteen years in
the presence of each other and the testator.
When the will is wholly
written by the testator, no witnesses are necessary. Nun-cupative
wills may be made when property willed does not exceed in value
*50, unless it be proved by three credible witnesses that the testator
called on some person to take notice and bear testimony that such is
“HLTj \ and ,that the testimony, or the substance thereof, was com­
mitted to writing within six days after the making of such will; in
such case the amount willed is not limited. Wills are revocable by
subsequent will, codicil, or declaration in writing, executed with like
formalities as in execution of will, or by testator destroying, canceling,
or obliterating the same, or causing it to be done in his presence, or
by subsequent marriage, and no provision is made for wife. Foreign
wills, the probate whereof is duly authenticated, may be probated
here. Contests of wills can not be initiated after one year from date
of probating.

SYNOPSIS OF

THE LAWS OF ARKANSAS
RELATING TO

BANKING AND COMMERCIAL USAGES,
Revised by Geo. W. Emerson,
National Standard Life Bldg.
Attorney at Law, Little Rock.
(See Card in Attorneys’ List.)
Accounts verified by the plaintiff as just and correct prove them­
selves in suits thereon unless denied under oath.
Acknowledgments may be taken within the State before the
supreme or circuit court, or a judge thereof, county and probate
court, or by county or probate judge, or clerk of any court of record
or a justice of the peace, or notary public; elsewhere in the United
States before any court having a seal, or clerk of such court, notary
public, mayor having a seal, or commissioner of Arkansas; without
the United States before any court having a seal, mayor of a citv
having a seal, United States consul, or any officer authorized by the
laws of such country to probate conveyances of real estate, provided
He nas a seal.
Actions. Suits are prosecuted under a reformed code of civil pro­
cedure differing from the New York code chiefly in maintaining the
distinction between law and equity.
Administration of Estates. Executors and administrators must
be residents of the State and must give bond in double the value of the
property. Foreign executors and administrators can maintain actions
In our courts. Claims are paid in the following order: First, funeral
expenses; second, expenses of last illness; third, judgments which are
liens on the lands of the deceased; fourth, demands presented within
six months; fifth, demands presented within one year. All demands
not presented in one year are barred. Demands must be authenticated
by an affidavit to the effect that nothing has been paid or delivered
toward their satisfaction except what is credited thereon, and that
the sum demanded, naming it, is justly due. Demands must first be
presented to the executor or administrator, and if disallowed by him
may be presented to the probate court, or sued upon in any court of
competent jurisdiction. Notes and debts secured by mortgages or
deeds of trust must be probated as any other claim, and if not pre­
sented to the executor or administrator within one year after ap­
pointment, are barred by the statute of non-claim of one year. When
the note or debt is barred this carries with it a barring of the mortgage
or deed of trust given to secure the notes or debts.”
6 8
Affidavits In this State are made before a judge, justice of the
peace, notary public, or clerk of the court; without the State before
? ,??e'c,P:la^or’ notary public, justice of the peace or commissioner
for tnis State.
Aliens may hold and transmit property in all respects as residents.
Arbitration. Controversies may be submitted to arbitration, and
the award of the arbitrators is filed in court, and is subject to review
on equitable principles only, and not for matters of form. When not
, i?s*de they are entered of record and become the judgment or decree
of the court.

2140

BANKING AND COMMERCIAL LAWS—ARKANSAS

Arrest. Defendants may be arrested for debt only when the
plaintiff flies an affidavit charging that the debt was fraudulently con­
tracted; that it is just, giving its amount, and that he believes that the
defendant is about to depart from the State, and with intent to de­
fraud his creditors, has concealed or removed from the State his
property or so much thereof that the process of the court after judg­
ment can not be executed; or that the defendan thas money or securi­
ties in the possession of himself or of others for his use, and is about
to depart from the State not leaving sufficient property therein to
satisfy the plaintiff’s claim. Bond must be given conditioned to pay
the defendant all damages that he may sustain if wrongfully arrested,
but attachment under such conditions is the usual and better practice.
Assignments for the Benefit of Creditors may be general or
partial, with or without preferences, and where all the debtor's prop­
erty is conveyed, may exact releases as a condition of preference. The
assignee must file an inventory of the property assigned and give a
bond conditioned that he will execute the trust confided to him, sell
the property to the best advantage and pay the proceeds to the credi­
tors mentioned in the assignment according to its terms, and faithfully
perform his duties according to law. He must sell within 120 days
ail property except the choses in action, which he is required to collect,
the sale to be at public auction after thirty days’ notice. Assignments
are vitiated by the fraud of the assignor alone or by any provision
varying from the requirements of the statute. All state insolvency
laws are held in abeyance since the Bankruptcy laws of 1898 and
amendments thereto. Attacks upon them are made by proceedings in
equity, and, if they are set aside, the proceeds are distributed equally
among all the creditors. Assignees close up their accounts under the
direction of the chancery courts. Corporations can not prefer creditors.
Attachments may be sued out where the defendant is a foreign
corporation or non-resident, or being insolvent has been absent from
the State four months, or has left the State with intent to defraud his
creditors, or has left the county of his residence to avoid the service of
summons, or conceals himself so that summons can not be served on
him, is or about to remove or has removed a material part of his prop­
erty out of the State, not leaving enough to satisfy his creditors, or has
sold, conveyed or otherwise disposed of his property, or suffered it to be
sold with the fraudulent intent to cheat, hinder, or delay his creditors,
or is about so to do. It is obtained by fll'ng an affidavit stating the
nature of the plaintiff’s claim, that it is just, its amount and the exist­
ence of the ground, and by giving bond conditioned to pay all damages
the defendant may sustain if the attachment is wrongfully sued out.
The defendant is allowed to traverse the attachment, and the affidavit
and traverse then stand as pleadings upon which the issue is tried.
If the attachment is dissolved, the defendant may have an assessment
of damages upon the bond in the same suit. Persons claiming the
attached property may interplead in the same action. Attachments
may be sued out before the debt is due where the defendant has sold,
conveyed, or otherwise disposed of his property, or permitted it to be
sold with the fraduient intent to cheat, hinder or delay his creditors,
or is so to do, or is about to remove his property, or a material part
thereof, out of the State with the intent of cheating, hindering or delay­
ing his creditors.
Banks. The banking business Is controlled by a state bank depart­
ment under the direction of a bank commissioner. Any five or more
persons, the majority of whom must be residents of this state, may
apply to the commissioner to be incorporated and the shares of capital
stock shall be not less than $25 nor more than $100 each; application
may also be made by an individual or firm and shall then be in such
form as the commissioner may prescribe and such individual or firm
shall adopt a name which will show that it is not incorporated; ail
property owned by such bank shall be held in the name of the bank
and not in the name of the individuals composing the firm and all
assets of any such private bank are exempt from execution by any
creditor of such individual or firm until all liabilities of the bank have
been paid; upon the death of an individual banker his widow is not
endowed of any property of the bank except such as remains after the
payment of all depositors and other creditors.
No corporation, firm or individual may do a banking business until
a fee of one-fifth of one per cent on the authorized capital stock shall
have been paid to the bank commissioner. Fees at the same rate
must be paid on each increase of the capital stock and for each amend­
ment or supplement to the articles of agreement, except for an increase
of capital stock, there shall be paid an additional fee of $10. There
Is also duo the commissioner an annual fee of $15 in addition to a pay­
ment or fifty cents on each $1,000 of the bank’s capital stock.
The fully paid-up capital stock of any bank organized after the pas­
sage of Hie banking act (March, 1913) cannot be less than $10,000 in
cities having less than 2,500 inhabitants, not less than $20,000 in cities
having more than 2,500 and less than 5,000 inhabitants, not less than
$25,000 in cities more than 5,000 and less than 10,000 inhabitants
and not less than $50,000 in cities having more than 10,000 inhabitants.
The banking act does not apply to trust companies whose minimum
capital stock is $50,000.
The affairs of an incorporated bank are controlled by a board of
directors chosen from the stockholders; each director must be the
owner or not less than $500 worth of stock, par value, fully paid-up and
not hypothecated; every bank must have on hand at all times as a
reserve as much as 15 per cent of the aggregate of its deposits.
Stockholders are liable for the debts of the bank in the sum of the
par value of their stock in addition to the amount invested in such
stock. (Act No. 113. Acts of 1913, page 462).
Bills. Exchange and Promissory Notes. The Negotiable
Instruments Law went into effect on April 22, 1913.
No person can be charged as an acceptor of any bill of exchange
unless his acceptance shall be in writing. If the acceptance is written
on another paper than the bill, it shall not bind the acceptor except
In favor of the person to whom such acceptance shall have been
shown, and who. on the faith thereof, shall have received the bill
for a valuable consideration. Every holder of a bill presenting
It for acceptance may require an acceptance on the bill; otherwise
the bill can be protested for non-acceptance. Notwithstanding the
above provisions any one promising to accept a bill is liable to any
person to whom a promise to accept it may have been made; and
who, on the faith of the promise, has drawn and negotiated the bill.
Any person on whom a bill is drawn, and to whom the same may
be delivered for acceptance, who shall destroy it or refuse within
twenty-four hours or such time as the holder may allow to return
the bill accepted or not accepted to the holder, shall be deemed to
have accepted the same. When the bills become due on any holi­
day, they are payable the next succeeding business day. Instru­
ments failing due (or becoming payable on) Saturday are to be pre­
sented for payment on the next succeeding business day; except
that insturments payable on demand may be presented for payment
before 12 o’clock on Saturday if it is not a holiday. The following
damages are allowed where a bill is protested for non-acceptance
or non-payment: If the bill is drawn on any place in this State,
2 per cent; if payable in the states of Alabama, Louisiana, Mississippi,
Tennessee, Kentucky, Ohio, Indiana, Illinois, or Missouri, or any point
on the Ohio River, 4 per cent, if drawn on any other place in the
United States, 5 per cent; if beyond the limits of the United States,
10 per cent. If the bill bo drawn by any person at any place within
this State, at the rate of 2 per cent; if drawn by any person at any
place without this State, but within the limits of the United States,
6 per cent; if drawn by any person without the limits of the United
States, 10 per cent. The holder of any bill protested for non-pay­
ment or non-acceptance is entitled to costs of protest and interest
at the rate of 10 per cent per annum on the amount of the bill from
date of protest. The term Bill of Exchange includes all drafts or
orders drawn by one person on another for the payment of a sum of
money specified therein. Bills and notes given for patented machines.
Implements, substance, or instruments of any kind, given to any
citizen of this State, are not commercial paper, unless executed on
a printed form, and showing for what consideration they were exe­


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cuted. This applies to patent rights and rights to use any patented
thing of any kind. But this provision does not apply to merchants
and dealers who sell patented things in the usual course of business.
All blank assignments are taken to have been made on such day as
shall be most to the advantage of the defendant. In other respects
the general rules of commercial law apply.
Bills of Lading. (See Warehouse Receipts and Bills of Lading.)
Blue Sky Law. The State Bank Department Is constituted and
delegated with full power and authority to permit or prohibit the
sale of contracts, stocks, bonds or other securities in Arkansas and
application must be made and his permission obtained before foreign
or domestic corporations, copartnerships or unincorporated associa­
tions offer their securities for sale.
The act was passed in 1915 and amended in 1923, and may be found
in Crawford & Moses’ Digest of the Statutes of Arkansas, sections
750-771. It is a misdemeanor to sell, or offer for sale, contracts,
stocks, bonds, or other securities without first obtaining authority or
a permit from the Blue Sky Department.
Collaterals are governed by the law merchant.
Contracts touching commercial matters are governed by the law
merchant.
Conveyances may be either witnessed by two witnesses or ac­
knowledged. (See Acknowledgments.) If witnessed they are proved
by the oath of two witnesses, and are then entitled to record as though
acknowledged. Dower can be relinquished only by the wife joining
the husband. The wife may convey property acquired since October
30, 1874, by deed as a single person without her husband joining her,
or by joining with him in the form above. The wife may convey by
power of attorney and make executory contracts of sale. Deeds
which have been recorded and are properly acknowledged prove them­
selves. Any substantial departure from the form of acknowledgments
prescribed by the statute, such as the omission of the words “con­
sideration” or “purposes,” makes the acknowledgment and record
void; but statutes have been passed from time to time curing defec­
tive acknowledgments previously made. Sucn a statute was passed
In 1907. A new Curative Act was passed and approved Febru­
ary. 10. 1911.
Corporations are organized only under general Incorporation laws.
Business corporations must consist of not less than three persons who
shall elect a board of directors. The president and secretary are to be
elected by the board and the president must be a member of it. The
secretary and treasurer must reside and keep the books of the com­
pany within the State. The articles of association must be signed by
the president and a majority of the directors, and must be accom­
panied by a certificate signed in a like manner and sworn to by the
president and a majority of the directors, setting forth the purpose of
the corporation, the amount of its capital stock, the amount actually
aid in, the names of its stockholders and the number of shares held
y each respectively, and the articles and certificate must be filed in
the office of the clerk of the county in which the corporation is to
transact business and then with the clerk’s endorsement in the office
of the secretary of State. The stock can be transferred by delivery
of the certificate endorsed in blank or to some specified person, or
by delivery of the certificate and a separate document containing a
written assignment or power of attorney to transfer. The corpora­
tion has no lien on its stock for debts due by its stockholders unless
such lien is stated upon certificate. The president and secretary
are required to file with the county clerk an annual statement of its
financial condition, and in case of a failure to do so become liable for
its debts. If the directors declare a dividend when the corporation
is insolvent they become liable for all the corporate debts. Any
corporation which is insolvent or has ceased to do business may be
wound up on the suit of any creditor or stockholder by a decree of
the chancery court. Preferences by insolvent corporations are for­
bidden. Shares of stock are in denominations of $25 or $100 or non­
par value. Before any corporations, foreign or domestic, can do any
business in this State, an annual franchise tax must be paid to the
State Treasurer, to wit: Eleven one-hundredths (11-100) of one
per cent each year upon the proportion of the outstanding capital stock
of the corporation represented by property owned and used in business
transacted in this state.
Every corporation doing business for profit and organized as a
mutual life, fire, accident, surety, health or other insurance company
not having a capital stock and not organized for charitable purposes
shall pay an annual tax of $100.00.
All foreign or domestic insurance companies, of whatsoever nature,
doing business in this State and having an outstanding capital stock
of less than $500,000 shall pay an annual tax of $100; and such com­
panies having a capital stock of $500,000 or more an annual tax of
$200, this tax being in lieu of the tax on the capital as provided in
other cases.
Every investment company, foreign or domestic, except National
banks and corporation not organized for profit, incorporated or unin­
corporated, which shall sell or negotiate the sale of any stocks, con­
tracts, bonds or other securities of any kind or character other than
bonds of the United States, or of some municipality authorized to
Issue bonds of the State, and notes secured by mortgages on real
estate located in the State, or sell building stock or loan investments,
shall file in the office of the Railroad Commission, together with a fee
of $5.00, in addition to the fees required of all incorporations, the
following documents: A statement showing in detail the plan upon
which it proposes to transact business; a copy of all contracts, bonds
or other instruments which it proposes to make with or sell to its
contributors: a statement showing name and location of company
and an itemized account of its actual financial condition and any other
such information which the Hailroad Commission may require: If
such company be a co-partnership or unincorporated association. It
shall also file a copy of its articles of co-partnership or association and
all other papers pertaining to its organization; if it be an Arkansas
corporation it shall file a copy of its articles of incorporation, con­
stitution and by-laws and all other papers pertaining to its organiza­
tion; if it be organized under the laws of any other state or territory
or government, incorporated or unincorporated, it shall file a copy of
the laws of such state or government under which it exists or is incor­
porated, and also a copy of its charter, articles of incorporation,
constitution and by-laws and other papers pertaining to its organi­
zation.
The Railroad Commission shall examine all such papers and may
admit or reject such company in its discretion; a company rejected,
or whose right to do business is revoked by the Railroad Commission,
may, within twenty days, appeal to the chancery court of any county
in the state where its principal office is located or principal agent resides.
If it be found that the refusal or revocation was justified, the cost
shall be paid by the company; otherwise by the state as provided by
statute.
Any individual or persons, co-partnerships, corporation, companies
or association, domestic or foreign, which shall sell any building or
investment contracts or like securities on which payments are to be
made from time to time, shall first enter into a bond with the State of
Arkansas in the sum of $20,000 for the faithful performance of its
contract.
Foreign Corporations shall, before doing business In the State, by
Its president file in the office of the secretary of State a certificate
under the seal of the company naming an agent, who shall be a citizen
of this State upon whom service of process can be made. The certi­
ficate shall state the principal place of business of the corporation;
and service on the agent shall bind it. The corporation must also file
a certified copy of its charter together with a statement of its assets
and liabilities, and the amount of its capital employed in this state
in the office of the secretary of State, and in the office of the county
where it opens an office, and must pay same fees as are required of
home corporations. It must also file a resolution of its board of
directors consenting that service of process on any of its agents or on
the secretary of State shall be a good service. If it sues in the federal

BANKING AND COMMERCIAL LAWS—ARKANSAS
court or removes a suit there without consent of its adversary, its
right to do business is revoked. Doing business nere without compli­
ance with the law subjects the corporation to a fine of not less then
*1,000. These requirements do not apply to railroad or telegraph
companies that had built lines in the State prior to Feb. 16, 1899. If
any corporation fails to appoint an agent, service of process on the
auditor of State shall bind it. No foreign corporation can sue on any
contract made in this State until these provisions are complied with.
Courts. The supreme court Is held at Little Rock and has juris­
diction of appeals from the circuit and chancery courts. In all coun­
ties separate courts of chancery have been established. The estates
of deceased persons are entrusted exclusively to the probate courts,
with right of appeal to the circuit and thence to the supreme court.
Claims against counties are heardby the county court, as also matters
touching paupers and the like. The justices’ courts have jurisdiction
of matters of contract not exceeding $300, and matters of tort not
exceeding $100. Two terms of the circuit and chancery court and
four of the county and probate courts are held in each county per year.
Courtesy. (See Dower.)
Deeds. (See Acknowledgments and Conveyances.)
Depositions may be taken in the State before any judge or clerk of
a court of record, justice of the peace, mayor, or notary public; out
of the State before a commissioner for this State, judge, justice of the
eace, mayor, notary public, or person commissioned by the court or
y consent of parties.
Descents and Distributions. Property descends to children and
their descendants in equal parts: if no children, then to father, then to
mother, then to brothers and sisters and their descendants in equal
arts, and in default of such to the nearest lineal ancestor or his
escendants in equal parts per stirpes. Illegitimate children inherit
and transmit an inheritance from the mother in the same manner as
if legitimate. If the parents of illegitimate children subsequently
Intermarry and the father recognizes them as his, they shall be deemed
legitimate. In default of heirs the whole property goes to husband
or wife, and in their default to the State. If rhe estate is ancestral it
goes to the blood of the ancestor from whom it was derived. Rela­
tions of the half-blood inherit equally. Heirs take as tenants in
common.
Dower. Where there are children the wife takes one-third of the
husband’s personal estate absolutely and one-third of the real estate
of which he was seized at any time during the marriage, for life. Where
there are no children she takes in a new acquisition one-half of the real
and personal estate absolutely as against heirs, or one-third absolutely
as against creditors. If it is an ancestral estate, she takes one-half for
life against heirs and one-third for life against creditors. Husband
takes same interest in wife's property by courtesy after death of wife.
If wife kills husband or husband kills wife and is convicted of murder
In first or second degree for such homicide their dower and curtesy
rights are forfeited.
Executions from the circuit court are returnable in sixty days,
those from justices’ courts within thirty. They may be stayed for
six months by giving bond. They are a lien on the personal prop­
erty of the defendant in the county from the time they come to the
officers’ hands. The officer before levying on personal property, the
title to which is doubtful, may require the plaintiff to give him an
indemnifying bond, and then suit must be brought by the claimant
upon the bond. The defendant and other judgment creditors have
one year in which to redeem from the sale of real estate. In case the
writ is returned nulla bona the plaintiff may proceed by bill of dis­
covery against the defendant and examine him on oath, and enforce
a surrender of concealed property by imprisonment.
Exemptions. Unmarried persons are entitled to $200 and married
persons and heads of families to $500 in selected articles of personal
property as exempt against debts by contract. Persons who are
married or heads of families are entitled to a homestead as against all
debts, except the purchase-money, specific liens, laborers' and mechan­
ics’ liens, taxes and claims for trust funds converted. The homestead
in the country is not to exceed 160 acres, and in town not to exceed
one acre, nor to be worth more than $2,500, but the country home­
stead is not to be reduced to less than 80 acres nor the town homestead
to less than one-fourth of an acre, regardless of value. The homestead
goes to the widow and minor children after the husband’s death. The
homestead can only be conveyed by deed in which the wife joins and
which is acknowledged by her, and if the thusband neglects to claim
the homestead the wife may do so.
Fraud. The English statute of fraudulent conveyances has been
re-enacted in this State.
Garnishments may be sued out pending suit upon giving bond
in double the amount garnished, or after judgment without bond.
Garnishment may be discharged and funds or property in hands of
garnishee released by filing bond for double the amount of sum
garnished. Upon judgment being rendered against defendant sum­
mary judgment may be rendered against sureties on bond. Act 177
of Acts 1925.
Holidays. The following are set apart and designated as legal
holidays: Christmas Day (December 25th); New Year’s Day (Jan­
uary 1st); July Fourth; Thanksgiving Day (last Thursday in Novem­
ber) ; Washington’s birthday (February 22nd); Labor Day (first
Monday in September); General Robt. E. Lee’s birthday (January
19th); All general biennial election days; Birthdays, Jefferson Davis,
President of the Confederate States of America (June 3rd); Arbor
Day (first Saturday in March, a special day). When bills become
due on any of these days, they are payable the next business day.
October 12th is Columbus Day (a public holiday, but not affecting
commercial paper, or the execution of written instruments, nor
Interfering with judicial proceedings).
Husband and Wife. (See Married Women.)
Injunctions may be issued by circuit judges, chancellors, or the
iudge of any court in which suit is brought. The person applying
for the injunction must give bond as the court or judge may direct in
absence of both circuit and chancery judges, county judge may issue
injunction.
Insolvency. The Supreme Court has held that the Federal Bank­
ruptcy Act has suspended the State insolvency laws.
Interest. The legal rate of interest is 6 per cent, but parties may
contract in writing for not exceeding 10 per cent. Interest exacted in
excess of 10 per cent forfeits the debt. In computing the interest
commissions paid to the agent of the lender are counted as interest.
Where usury is charged the borrower may go into equity and have the
debt and securities cancelled without tendering the amount lawfully
due. Judgments bear the same rate of interest as the obligation sued
on. Judgments against counties bear no interest.
Judgments (See Interest) are liens upon the real estate of the
debtor in the county where rendered for three years only. The lien
may be renewed and continued for three years by scire facias. Judg­
ments of the United States and other courts can be made liens on lands
<n counties other than that where they are rendered by filing a certified
copy in the office of the circuit clerk. A judgment survives for ten
years and cannot be revived after ten years from date of same.
Jurisdiction. (See Courts.)
Liens. Mechanics, builders, artisans, laborers, and others doing
any work upon orf urnishing any material for any building or erection
under any contract with the owner or his agent, contractor or sub­
contractor. shall have for such work or material furnished a lien on
the building or improvement together with the land on which it stands
to the extent of one acre if in the country; if in a city the lot or land
upon which the erection is situated. Hotel keepers have lien on
baggage and personal effects of guests. Liverymen have lien on all
stock and property left in their care.
Limitations. Suits for the possession of real estate must be
brought within seven years, saving to minors and lunatics three
years after their disabilities are removed. Actions for recovery of


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2141

lands sold at judicial sales must be brought within five years, saving
to minors and lunatics three years after removal of disabilities.
Actions for the recovery of lands held under tax title must be brought
in two years. Actions for forcible entry and detainer, on contracts
not in writing, for trespass and for libel, within three years. Actions
for criminal conversation, assault and battery, false imprisonment,
and slander, within one year. Actions on written instruments, within
five years; on judgments, within ten years; on bonds of executors
and administrators, within eight years. In all cases, except actions
for the recovery of lands, minors and lunatics have, after removal
of their disability, the statutory period in which to sue. Verbal
promises or acknowledgments do not take a claim out of the statute.
One year is allowed after dismissal of a suit in which to begin a new
action. No person can avail himself of a disability which did not
exist at the time the right of action accrued. No endorsement of pay­
ment made by the payee or on his behalf is sufficient proof to take
the case out of the statute.
Limited Partnerships may consist of one or more general, and one
or more special partners. The latter of whom shall constitute in cash a
specific amount as his share of the capital, beyond which he is not
liable for firm debts. Those forming such partnership must make
and file in office of circuit clerk of county, and principal place of busi­
ness, a certificate showing name of firm, names of partners, distin­
guishing between general and special, nature of business, amount
of capital contributed by each partner, period of commencement and
termination of partnership. Business to be conducted by general
partners and suits brought by or against them.
Married Women. The property, real and personal, of married
women remains their separate estate as long as they choose, and may
be devised or conveyed without the husband’s assent, and is not
subject to his debts. If she dies without making any disposition of
her real estate, he is entitled to curtesy if they have or have had issue
born alive. She may carry on any business or perform any services
on her own account, and her earnings are hers, and she may sue alone
in respect of her separate property. She can bind herself by contract
only in reference to her separate estate or business. She can not
enter into partnership with her husband. If she does not file a
schedule of her personal property, the burden of proof is on her to
show that it is hers.
Mines and Mining. Under control of commissioner of mines.
All documents relating to mines must be recorded in the recorder’s
office of the county; and miners of the county may make by-laws
regarding the time, manner, and amount of work necessary to hold
claims and other rules and regulations not in conflict with law. Exten­
sive provisions are made for the protection of the health and safety
of miners. (Acts 1893, p. 213.) Miners have a lien on the output,
machinery, and tools used to secure payment for work done. Three
years’ possession of a mine with work reauired by law, gives possessory
right.
Mortgages are not liens as against any one, though such person
has actual notice of their existence, until they are acknowledged in
the form prescribed and filed for record. Mortgages of real estate
are recorded in the county where the land lies, and mortgages of
personal property in the county of the mortgagor’s residence. If the
mortgagor of personality is a non-resident the mortgage is recorded
In the county where the property is situated. Sales under mortgages
and deeds of trust can be made only after appraisement, and the
property must bring two-thirds of the appraised value. In case it is
offered and fails to bring the required amount real estate may be
offered again after one year and personal property after sixty days,
and is then sold for what it will bring. The mortgagor of real estate
has one year from the date of sale in which to redeem. In action to
foreclose a mortgage, it is sufficient defence that the debt (which it
recites), is barred by statute of limitations.
Chattel Mortgages may be acknowledged and filed as other mort­
gages, or they may be endorsed “This instrument is to be filed but not
recorded,” signed by the mortgagee, and may then he filed in the
recorder's office with the same effect as though recorded. Mortgages
of personal property reserving in the mortgagor the power of disposi­
tion are fraudulent.
Mortgages and Deeds of Trust may be enforced by foreclosure
at any time within the period prescribed by law for foreclosing mort­
gage or deed of trust so far as the property mentioned and described
In such mortgage or deed of trust is concerned, but no claim or debt
against the estate of a deceased person shall be probated against
such estate whether secured by mortgage or deed of trust or not
except within the time prescribed by law for probating claims against
Powers of Attorney. Lands may be conveyed by power of attor­
ney, which is acknowledged as deeds and recorded in the county
where the lands lie.
Probate Law. (See Administration of Estates.)
Protests. (See Bills of Exchange and Promissory Notes.)
Records. (See Acknowledgments, Conveyances, Mortgages.
Chattel Mortgages, and Powers of Attorney.)
Redemption. (See Executions and Mortgages.)
Replevin. The plaintiff in replevin may file an affidavit describing
the property, stating its value and the amount of damages he expects
to recover, his title, that the property is wrongfully detained by the
defendant, that it has not been taken for a tax or under process against
plaintiff, and that his cause of action has accrued within three years,
and upon giving bond in double its value, the property shall be taken
from the defendant and given to the plaintiff pending the suit, unless
the defendant within two days after it is taken gives a cross-bond.
Revision. The last revision of the statutes was in 1921.
Taxes. All property should be assessed for taxes between the
first day of May and the first day of June in each year, except in
counties where the population exceeds 75,000, in which taxes should
be assessed between the first day of January and the 10th day of
April. State Tax Commission has general supervision and control
over tax matters. Taxes must be paid between January 1st and
April 10th of the year following the assessment. After April 10th
penalty of 25 per cent will accrue. Taxes are first and paramount
ien upon real and personal property after first Monday in June of the
year in which assessment is made, which lien continues until such
taxes with penalty shall be paid.
Testimony. (See Evidence.)
Transfer of Corporation Stock. (See Corporations.)
Trust Companies must have a paid-up capital of $50,000, and
In counties with a population exceeding 50,000, they must have a sub­
scribed capital of not less than $100,000. They may exercise all the
powers commonly conferred on such companies.
Wages. No assignment or order of wages to be earned in the
future to secure a loan of less than $200, shall be valid against any
employer or the person making such assignment or order, until such
assignment or order is accepted in writing by the employer and the
said assignment or order and the acceptance of same has been filed
with the recorder of the county where the party making the assign­
ment or order resides, if a resident of the state where he is employed.
No assignment or order of wages to be earned in the future shall be
valid when made by a married man unless the written consent of his
wife to making such an assignment or order for wages shall be attached.
Warehouse Receipts and Bills of Lading shall not be given
except where the commodities mentioned are received on the premises,
and are under the control of the warehouseman at the time of its
issuance. No warehouseman shall sell, encumber, ship, or remove
any such commodity for which a receipt has been given without the
written assent of the holder of the receipt. The same provisions cover
owners and agents of boats and vessels. All warehouse receipts and
bills of lading are made negotiable by written endorsement and
delivering the same as bills of exchange and promissory notes, and no
printed or written conditions, clauses, or provisions inserted in or

2142

BANKING AND COMMERCIAL LAWS—CALIFORNIA

attached to them shall in any way limit their negotiability or impair
the rights and duties of the parties thereto, or persons interested
therein, or such conditions shall be void. Warehouse receipts given
by any warehouseman or other person for goods and other com­
modities deposited, and all bills of lading given by any carrier, boat,
vessel, railroad, transportation, or transfer company may be trans­
ferred by endorsement and delivery; and the transferee shall be
deemed to be the owner of such commodities so far as to give validity
to any pledge, lien, or transfer given, made, or created thereby; and
no property so stored or deposited shall be delivered except on sur­
render and cancellation of such receipts and bills of lading, unless
such receipts and bills of lading have the words “not negotiable"
plainly written or stamped on their face. A carrier may however
deliver to shipper or consignee goods without presentation of bill of
lading upon receiving from such shipper or consignee bond in double
the value of the goods conditioned for delivery to the carrier there­
after the original bill of lading (acts 1907). Penalties are denounced
against any warehouseman or other person who shall violate any of
the provisions of this statute. So much of the act as forbids the
delivery of property except the surrender and cancellation of the
original receipt or bill of lading shall not apply to property replevined
or removed by operation of law.
Wills. A will must be subscribed by the testator or by some person
for him at his request in the presence of two attesting witnesses, and he
must acknowledge it to be his will to each of them. He must declare
at the time of his subscription or acknowledgment to the witnesses
that the instrument is his will and testament. The witnesses must
sign their names at the end of the will as witnesses at the request of
the testator. If, however, the entire will is in the hand-writing of the
testator, it need not be attested, but may be proved by three witnesses
familiar _ with the hand-writing. Such will, however, can not be
pleaded in bar of an attested will. Wills are revoked by marriage and
birth of issue, unless provision for such issue is made by settlement,
or is provided for in the will. The will of an unmarried woman is
revoked by her marriage. Afterborn children, not mentioned in the
will, take their regular distributive share. If the testator fails to
mention in his will any child, or its legal representatives, living at the
time of executing the will, he shall, as to such child, or its represent­
atives, be deemed to have died intestate, and such child, or its rep­
resentatives. is entitled to its regular share.

SYNOPSIS OF

THE LAWS OF CALIFORNIA
RELATING TO

BANKING AND COMMERCIAL USAGES.
Revised by Tanner, Odell & Taft,
Attorneys at Law, Suite 524 Van Nuys Building,
Los Angeles.
(See Card in Attorneys’ List.)
Accounts. An account is assignable, and the assignee may main­
tain an action thereon, although the account is assigned merely for
collection. An action to recover a balance due upon a mutual current
and open account or upon an open book account is barred within four
years. The cause of action on a mutual account is deemed to have
accrued from the date of the last item. In the case of an open book
account, each item becomes outlawed four years after its date. (See
Actions and Limitations.)
Acknowledgments. Before an instrument can be recorded, its
execution must be acknowledged by the person executing it, or if
executed by a corporation, by its president or secretary, or other
person executing the same on behalf of the corporation, or if a part­
nership by a member thereof, or proved by a subscribing witness, or by
judgment in an action brought for the purpose. The proof or acknowl­
edgment of an instrument may be made at any place within the State
before a justice or clerk of the supreme court, and within the city,
county, or township for which the officer was appointed or elected,
before either: (1) A clerk of a court of record; (2) a county recorder;
(3) a court commissioner; (4) a notary public; (5) a justice of the
peace. The acknowledgment of an instrument must not be taken,
unless the officer taking it knows or has satisfactory evidence, on the
oath or affirmation of a credible witness that the person making such
acknowledgment is the individual who is described in, and who
executed the instrument; or if executed by a corporation that the
person making such acknowledgment is the president or secretary of
such corporation, or other person who executed it on its behalf. Officers
taking and certifying acknowledgments or proof of instruments for
record, must authenticate their certificates by affixing thereto their
signatures, also their seals of office, if by the laws of the State or coun­
try where the acknowledgment or proof is taken, or by authority of
which they are acting, they are required to have official seals. Acknowl­
edgments taken out of this State but within the United States, to be
used within this State, may be taken before a notary public, a com­
missioner appointed by the governor of this State, a judge, or clerk of
a court of record, or in foreign countries a minister, counsul, viceconsul, or consular agent of the United States, or a judge of a court
of record or a notary public.
Actions. All civil actions are commenced by filing a complaint,
upon which plaintiff may, at any time within one year thereafter, have
a summons issued. There is but one form of action and the only
pleadings allowed on the part of the plaintiff are: 1. The complaint.
2. The demurrer to the answer. 3. The demurrer to the cross-com­
plaint. 4. The answer to the cross-complaint, and on the part of
the defendant: 1. The demurrer to the complaint. 2. The answer.
3. The cross-complaint. 4. The demurrer to the answer to the
cross-complaint. Motions to strike and to make more certain may
be made.
Administration of Estates. Upon the admission of a will to
probate, letters testamentary are granted by the superior court to the
executor named in the will, unless he be dead or incapable or unwilling
to act, in which case letters testamentary are issued to an adminis­
trator with the will annexed, appointed by said court. In case of
Intestacy, letters of administration are issued to the bona fide resi­
dent of the state entitled thereto, in the following order: 1. Surviving
spouse or some competent person whom he or she may request to
have appointed. 2. The children. 3. The grandparents. 4. The
parents. 5. The brothers and sisters. 6. The next of kin entitled to
share in the estate. 7. Relatives of a previously deceased spouse
when entitled to succeed to some portion of the estate. 8. The public
administrator. 9. The creditors. 10. Any person legally competent.
Relatives of whole blood preferred to those of half. Nominee by
person in classes 2, 4 or 5 not otherwise entitled to act has priority
next after those in class of person nominating in discretion of the
court. Where the person entitled to administration is a minor or
noncompetent, letters must be granted to his or her guardian, or to any
other person entitled to letters of administration in the discretion of
the court. Bonds for faithful performance of duty are required of
an administrator and of an executor unless waived by the will. Notice
must be given by the administrator or executor by publication to all
the creditors to come in and prove their claims within six months after
its first publication. Claims arising on contract whether due or not
due or contingent, and funeral expenses must be presented within
time prescribed by notice to creditors, otherwise they are forever
barred, unless it appears by affidavit of the creditors that such creditor
was outside of the State and consequently did not receive notice, in
which case the claim may be presented at any time before a decree


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of distribution is entered. When a claim is rejected either by the
executor or administrator or the judge, the holder must bring suit in
the appropriate court thereon within three months after the date
of its rejection, if it be then due or within two months after it becomes
due, otherwise the claim is forever barred. No claim can be allowed
which is barred by the Statute of Limitations. Claims against the
estate are paid in the following order: 1. Expenses of administration.
2. Funeral expenses. 3. Expenses of last illness. 4. Family allow­
ance. 5. Debts having preference by laws of the United States.
6. Wages (limit $200 each) to employes for services rendered within
90 days of death. 7. Mortgages and other liens in order of priority.
8. Judgments against decedent. 9. All other demands.
No administration is necessary where there is no real property and
the value of the whole estate does not exceed $1,000. Minor children
are entitled to homestead rights when both parents are dead.
Affidavits. An affidavit to be used before any court, judge, or
officer of this State may be taken before any officer authorized to
administer oaths. In this State every court, every judge or clerk of
any court, every justice and every notary public, and every officer or
person authorized to take testimony in any action or proceeding, or
decide upon evidence, has power to administer oaths and affirmations.
An affidavit taken in another State of the United States to be used
In this State, may be taken before a commissioner appointed by the
governor of this State to take affidavits and depositions in such other
State, or before any notary public in another State, or before any
judge or clerk of a court of record having a seal. An affidavit taken
in a foreign country to be used in this State, may be taken before an
ambassador, minister, consul, vice-consul, or consular agent of the
United States, or before any judge of a court of record having a seal.
In such foreign country.
Allens. 1. All aliens eligible to citizenship may take, hold and
dispose of property, real and personal, within this State.
2. All aliens not eligible to citizenship may acquire and possess land
In accordance with the terms of any existing treaty with any foreign
country of which such alien is a citizen, and not otherwise. Nor can
such be guardian of any estate consisting in part or whole of real estate.
3. Any company, association or corporation composed in the main
of aliens not eligible to citizenship may acquire and possess land in
accordance with the terms of any existing treaty with any foreign
country of which they are citizens, and not otherwise. Likewise
cannot be guardian of estate in which there is real property.
4. When it appears in any probate proceedings wherein any alien
to an heir that he could take real property, or membership, or shares
in a company or a corporation, except for the provision of this act,
the probate court shall order the sale of such real property or shares
in a company or corporation, and distribute the proceeds to such alien.
5. For any violation of this act tne attorney-general shall institute
forfeiture proceedings and upon final judgment the lands shall escheat
to the State.
6. When it appears that any alien or aliens are holding any lease­
hold interests in violation of the above provisions the attorney-general
shall likewise institute forfeiture proceedings, and such leasehold
interest or its monetary value together with the costs of such forfeiture
proceedings shall escheat to the State.
No non-resident alien can take by succession unless he appear
and claim within 5 years after death of decedent. No alien may be
employed upon any public work except in cases of extraordinary
emergency.
Arbitration. In all cases except those pertaining to labor, a con­
tract in writing may provide for arbitration of controversies arising
thereafter, or an existing controversy may be submitted to arbitration
in writing with a provision for the rendition of judgment upon the
award in any specified court of record, and the entry thereof in any
specified County. Otherwise, the judgment may be entered in the
Superior Court of the County where the arbitration was had.
Arrest. In an action for the recovery of money, upon a contract,
express or implied, the defendant may be arrested if about to depart
from the State with intent to defraud his creditors, upon order of
court based upon affidavit therefor, also in an action for money or
other property embezzled or fraudulently misapplied by a public
officer, officer of a corporation, or an attorney, factor, broker, agent,
or clerk in the course of his employment, or by any person in a fidu­
ciary capacity; also in actions to recover the possession of personal
property where it has been concealed or removed or disposed of to
prevent its being found; also in cases where the defendant has been
guilty of a fraud in contracting the debt or obligation for which action
is brought; or in concealing or disposing of property; also when the
defendant has removed or disposed of his property or is about to do
so with intent to defraud creditors. Bail given upon arrest is liable
upon judgment secured.
Assignments for the Benefit of Creditors. Assignments for
the benefit of creditors must be written and acknowledged by the
assignor or his agent authorized thereto in writing and recorded, and
must be made to the sheriff of the county where the insolvent resides,
or, if a non-resident, where he has property. Assignments for the
benefit of creditors are void against any creditor not assenting thereto
in a number of instances; for example, where they give one debt a
preference over another, and where they tend to coerce any creditor to
release or compromise his demand. Assignments must contain names
of creditors and the amounts. The statutory method of assignment
is almost never followed in practice.
Attachments may be issued at the time of or any time after
issuing the summons, and prior to judgment, where amount sued for
exceeds $10.00 as is hereinafter provided. All property not exempt
from execution may be attached. An attachment lien upon real
property continues for three years and may be extended for two years
more. On personal property an attachment continues three years.
The clerk of the court must issue the writ of attachment upon receiv­
ing an affidavit by or on behalf of the plaintiff showing, (l) That
the defendant is indebted to the plaintiff, specifying the amount of
such indebtedness over and above all legal set-offs or counter-claims,
upon a contract, express or implied, for the direct payment of money,
and that such contract was made or is payable in this state, and that
the payment of the same has not been secured by any mortgage or
lien upon real or personal property, or any pledge of personal property,
or, if originally so secured, that such security has, without any act
of plaintiff, or the person to whom the security was given become
valueless, or (2) That the defendant is a nonresident of the State, or
has departed from the State, or who is unable to be found after dili­
gent search within the State, and is indebted to plaintiff specifying
the amount of such indebtedness over and above all legal set-offs or
counter-claims, upon a contract expressed or implied; or (3) That
plaintiff’s cause of action against defendant is one to recover a sum
of money as damages (specifying the amount thereof) arising from an
injury to property in this State in consequence of the negligence,
fraud or other wrongful act of the defendant, and that the defendant
is a nonresident of the State, or has departed from the State, or who
is unable to be found after diligent search within the State: and (4)
That the attachment is not sought, nor is the action prosecuted, to
hinder, delay, or defraud any creditor of defendant. Before issuing
the writ, the clerk must require a written undertaking on the part of
the plaintiff, in a sum not less than $200, in the Municipal Court not
less than $50.00 nor more than $1,000; or in Justices’ Court of from
$50,00 to $300, and not exceeding the amount claimed by plaintiff
(usual amount being one-half amount claimed), with sufficient sureties,
to the effect that, if the defendant recovers judgment, the plaintiff
will pay all costs that may be awarded to the defendant, and all
damages that he may sustain by reason of the attachment, not exceed­
ing the sum specified in the undertaking, and that if the attachment
is discharged on the ground that the plaintiff was not entitled thereto,
the facts required in the above not being existent, the plaintiff will
pay all damages, which the defendant may have sustained by reason
of the attachment, not exceeding the sum specified in the undertaking.
Banks. The business of banking may be carried on only by
corporations organized for such purpose under the California Bank

BANKING AND COMMERCIAL LAWS—CALIFORNIA
Act. Banking corporations may be organized by not less than three
persons. Stockholder is liable notably for debts of the bank to the
amount of twice the par value of stock held by him. Directors must
each own stock of the par value of not less than $500. A bank organ­
ized under the laws of another state must comply with all the require­
ments of the California Bank Act. A banker has a general lien
dependent upon possession of all property in his hands belonging to
a customer for balance due from customer in the course of business.
Every bank must designate the character of its business. By virtue
of the California Bank Act of July 1, 1909, as amended, all banks,
foreign and domestic, are under the supervision of the State Superin­
tendent of Banks and must obtain a certificate of authority to do
a banking business. This Act sets forth in considerable detail the
legal requirements which banks must comply with in the conduct of
their business. The Act sets forth the minimum requirements regard­
ing capital and surplus, such requirements being identical for both
commercial and savings banks, as follows: $50,000 in cities of less
than 25,000 inhabitants: $100,000 in cities of from 25,000 to 100,000
inhabitants; $300,000 in cities of over 200,000 inhabitants. Com­
mercial and savings banks must have a surplus of 25 per cent of capital
stock. Trust companies likewise operate under the supervision of
State Superintendent of Banks, and must deposit cash or securities
with State Treasurer to insure faithful performance of trusts. The
minimum deposit required is $100,000, and the amount varies accord­
ing to population and amount of the res. Any savings bank may
purchase, hold or sell real or personal property, as follows: Cl) The
real estate, furniture, fixtures, etc. in which its business may be con­
ducted, such real estate, etc. not to be carried on the books of such
bank as an asset to an amount exceeding its paid up capital and sur­
plus. Commercial banks are restricted to one-half such amount.
(2) Such as may have been mortgaged, pledged or conveyed to it in
trust for its benefit in good faith, or money loan in regular course of
business. (3) Such as may have been purchased at sales under
pledge, mortgage or deed of trust made for its benefit or money loaned
and such as may be conveyed to it by borrowers in satisfaction and
discharge of loans. (4) Gold and silver bullion, and United States
Mint Certificates. (5) Bonds and other securities of certain classes
as are set forth in Section 61 of California Bank Act. Savings banks
may not make loans for longer periods than ten years. With some
exceptions no commercial bank can lend more than 10 per cent of its
capital stock on unsecured loan, or 15 per cent, in addition to the
amount that may be loaned without security, upon security worth
at least 15 per cent more than the amount loaned so secured, pro­
vided the total amount cannot exceed 25 per cent in all and separate
note must be taken for the unsecured and the secured loan, or 25
per cent upon security worth at least 15 per cent more than the amount
of the loan so secured, or 40 per cent upon commercial or business
paper actually owned by the person negotiating same to the bank and
are endorsed by such persons without limitation. But commercial
banks may accept drafts or bills of exchange having not more than
six months sight to run growing out of transactions involving importa­
tion or exportation of goods or involving domestic shipment of goods
providing shipping documents are attached as security or are secured
by warehouse receipts or other document of title. No bank shall
hold as security for loans more than 25 per cent of the capital stock of
another bank, nor loan in excess of 10 per cent of its assets upon the
security of capital stock of any corporation. A surviving husband or
wife or next of kin of any deceased person may, without procuring
letters of administration, withdraw any sum deceased may have had on
deposit in any savings bank if the sum does not exceed $1,000. De­
posits unclaimed for twenty years escheat to the State. Any deposits
regarding which a further deposit or a withdrawal have not been
made or regarding which interest has been unclaimed for more than
twenty years, and where neither depositor nor claimant have filed
notice with bank showing his present residence must be deposited
with the State Treasurer after judgment has been obtained in an
action commenced according to statues for such purpose. County
Clerk must issue notice of such action at time summons therein is
issued and such notice must require all persons claiming interest in
such deposit to appear within sixty days after first publication and
show cause. Summons and copy of notice must be published in
newspaper of general circulation for four weeks. Any person interested
may appear. The President or managing officer of every bank must,
within fifteen days after first day of January of every year, return to
Superintendent of Bank and to State Controller a sworn statement
showing names of depositors known to be dead, or who have not
made further deposit or withdrawal during preceding twenty years
and not known to be living, and amount of whose deposit is more
than $10.00. A bank organized or doing business in this state may
refuse payment of check or draft, except cashier’s check or bank
draft, if presented for payment more than six months from its date
unless expressly instructed to pay by drawer or maker, and no lia­
bility shall attach to drawer or maker by such non-payment.
Bills and Notes. The Uniform Negotiable Instruments Law is
in force. Statutes of 1917. Chapter 751.
Bulk Sales. (See Fraudulent Sales and Conveyances.)
Chattel Mortgages may be made on any personal property.
Including growing crops and fruits, except personal property not
capable of manual delivery, articles of wearing apparel and personal
adornment, and the stock in trade of a merchant, provided that when
said personal property refers to fixtures or equipment of a baker, care
or restaurant owner, garage owner, machinist or retail or wholesale
merchant seven days’ notice must be given (recorded with County
Recorder), otherwise the same is void as to creditors of the mort­
gagor. In the absence of delivery and continued change of possession,
the chattel mortgage will be void as to creditors of the mortgagor
unless acknowledged or proved, certified, and recorded, as required
in cases of grants of real property and accompanied by affidavits of
all the parties that it is made in good faith, and without any design
to hinder, delay or defraud creditors. Such chattel mortgages must
be recorded in the office of the County Recorder of the county in
which the mortgagor resides, if he be a resident of this state, and it
shall also be recorded in the county in which the property mortgaged
is situated, or (save in the case of live stock, vehicles, other than motor
vehicles! and other migratory chattels) to which it is removed. If
removed to another county such chattel mortgage must be recorded
in such county within thirty days of such removal. If such mort­
gaged property is voluntarily removed by the mortgagor from the
county where it is situated, the mortgagee may take possession of
the same and dispose of it as a pledge though the debt is not due,
save in the case of live stock, vehicles (other than motor vehicles)
and other migatory chattels. When the mortgage on live stock,
vehicles (other than motor vehicles) and other migatory chattels has
been recorded, and a certificate of the same has been filed with the
Secretary of State by the County Recorder, the mortgage will not be
affected by removal of the property mortgaged to any county within
the State.
Collaterals. Are governed by the law relating to pledges of per­
sonal property. A pledge is a deposit of personal property by way of
security for the performance of any act. Delivery of the thing
pledged is essential to the validity of the bailment. When the per­
formance of the act for which the pledge is given is due in whole or
in part, the pledgee may collect what is due to him by the sale of the
property pledged. But before the property can be sold the pledgee
must demand performance thereof rrom the debtor, if he can be
found, and must give actual notice to the pledgor of the time and
place at which the property pledged will be sold, at such a reasonable
time before the sale as will enable the pledgor to attend, but notice
of the sale may be waived by the pledgor at any time. The sale
must be by public auction and must be for the highest obtainable
price. After the sale the pledgee may deduct from the proceeds the
amount due and the necessary expenses of sale and collection, and
must pay the surplus to the pledgor. The pledgee, or a pledge­


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2143

holder, may purchase the property pledged when the same is sold
at public auction. A pledgee can not sell any evidence of debt
(collateral) pledged to him, except the obligations of governments,
states, or corporations: but he may collect the same when due.
Contracts. Certain contracts are Invalid unless the same or
some note or memorandum thereof is in writing. (See Statute of
Frauds.) A contract for personal services cannot be enforced for
over seven years.
Conveyances. An estate In real property, other than an estate at
will, or for a term not exceeding one year, can be transferred only by
operation of law, or by an instrument in writing, subscribed by the
party disposing of the same, or by his agent thereunto authorized In
writing. Leases of agricultural land for a longer period than fifteen
years and of city property for a longer period than ninety-nine years are
void. A fee simple title is presumed to be intended to pass by a grant
of real property, unless it appears from the face of the grant that a
lesser estate was intended. A grant of real property may be made
In the following form: "I, A. B., grant to O. D. all that real prop­
erty situated in (insert name of county) county, State of California,
bounded (or described) as follows: (Here insert description, or if
the land sought to be conveyed has a well-established descriptive
name it mav be described bv such as for instance: ‘The Norris
Ranch.’) Witness my hand this (Insert) day of (insert month). 19—
A. B.” The use of the word "grant” implies the following cove­
nants: 1. That previous to the time of the conveyance the grantor
had not conveyed the same estate, or any right, title, or interest
therein to any person other than the grantee. 2. That such estate
Is at the time of the execution of the conveyance free from incum­
brances, done, made, or suffered by the grantor. Subsequently
acquired title passes by operation of law to the grantee, or his suc­
cessors. Instruments entitled to be recorded must be recorded by
the county recorder of the county in which the real property affected
thereby Is situated. Every conveyance of real property, acknowl­
edged or proved and certified and recorded as prescribed by law from
the time ft is filed with the recorder for record, is constructive notice
of the contents thereof to subsequent purchasers and mortgagees, and
every conveyance of real property other than a lease for a term not
exceeding one year is void as against any subsequent purchaser or
mortgagee of the same property, or any part thereof, in good faith
and for a valuable consideration, whose conveyance is first duly
recorded.
Corporations. Private corporations may be formed by the volun­
tary association of any three or more persons, in the manner prescribed
by statute. Private corporations may be formed for any purpose
for which individuals may lawfully associate themselves. The num­
ber of directors of corporations for profit, except those mentioned as
excepted, may be increased or diminished, by the stockholders of the
corporation holding a majority of the issued and outstanding shares
to any number, not less than three. The Articles of Incorporation
having been formed according to law, the Secretary of State shall
file them in his office and put an endorsement of filing thereon. The
corporate existence shall begin upon the filing of the Articles of
Incorporation and shall continue for an indefinite term, unless it be
otherwise provided. The Articles of Incorporation may also contain
provisions: (a) describing special qualifications of persons who may
be shareholders, or restricting the rights to transfer or hypothecate
shares: (b) granting or denying to the directors the power to levy
assessments upon the shares of any class thereof, or restricting such
power; (c) denving to shareholders preemptive rights to subscribe
to any or all issues of shares or denying or placing limitations upon
such rights. A copy of the Articles of Incorporation, certified by the
Secretary of State and bearing the endorsement of the date of filing
in his office, shall be filed in the office of the County Clerk of the
County in which the corporation is to have its principal place of busi­
ness. Provision is also made for protecting corporations from having
corporate names which might mislead the public. Before a corpora­
tion, which shall be formed hereafter, can purchase, locate or hold
property in any county in the state, must first file a certified copy
of its Articles of Incorporation with the County Clerk of the County
in which such property is situated within sixty days after such pur­
chase or location is made. All present existing corporations must
within ninety days from September 15, 1930, likewise file a certified
copy of the Articles with the County Clerk where such property
is located. A copy of any articles of incorporation filed in pursuance
of this chapter, and certified by the Secretary of State, must be received
in all the courts, and other places as prima facie evidence of the facts
therein stated. (See Foreign Corporations.) Stock is not assessable,
except as provided in the Articles. The franchise of all corporations
as distinct from its tangible property is subject to taxation.
The term “stockholder" extends to every equitable owner
of stock, although the same appears on the books in the name of
another, and also to every person who has advanced the install­
ments or purchase money of stock in the name of a minor, so long as
the latter remains a minor; and also to every guardian or other
trustee who voluntarily invests any trust funds in the stock. Stock
held as collateral security, if fact of pledge appears, or by a trustee, or
in any other representative capacity, does not make the holder thereof
a stockholder, except in the case above mentioned.
Courts. Terms and Jurisdiction. Justices’ Court. A Justices’
Court has been established in each township excepting in cities now
having Municipal Courts. In cities, cities and counties towns and
judicial townships of 30,000 or more inhabitants, Justices’ Courts have
original jurisdiction in cases at law in which the demand, exclusive of
interest, or the value of property in controversy, amount to $1,000 or
less; of all actions of forcible or unlawful entry or detainer wherorental
value is $100 or less per month, and where the whole amount of
damages claimed is $1,000 or less; in all cases to enforce and fore­
close liens on personal property where amount of such liens or value
of property is $1,000 or less; and in cases in equity when pleaded
as defensive matter or by way of cross-complaint in any case at law
commenced in such court of which they have jurisdiction. In cities,
etc., having population of less than 30,000, Justices’ Courts have
original jurisdiction in all cases at law in which the demand, exclusive
of interest, or the value of the property in controversy, amount to
$300 or less; of all actions of forcible or unlawful entry or detainer
where rental value is $75.00 or less per month, and where the whole
amount of damages claimed is $300 or less; in all cases to enforce
and foreclose liens on personal property where amount of such liens
or value of property is $300 or less. The territorial jurisdiction is
restricted to townships where Justices’ Court is held but process is
co-extensive with County, and such courts are not courts of record.
Municipal Courts may be established in cities, or cities and coun"
ties having population of over 40,000, and have been established in
the cities of Los Angeles, Long Beach and San Francisco. They
have exclusive original jurisdiction of all civil cases and actions arising
within the city or city and county in which said Municipal Court is
established of the following classes: (1) All cases in which demand,
exclusive of interest, or value of property, amounts to $2,000 or less.
(2) All actions of forcible entry or forcible or unlawful detainer where
rental value is $200 or less per month and where whole amount claimed
is $2,000 or less. (3) All actions to enforce and foreclose liens on per­
sonal property where amount is $2,000 or less. (4) All actions to
enforce liens of mechanics and material men when amount is $2,000
or less. They have concurrent jurisdiction in cities or cities and
counties where Municipal Court is established and an inferior court
has been established and its jurisdiction determined as provided by
law, Municipal Court has concurrent jurisdiction with such inferior
court. Municipal Courts have original jurisdiction of all cases
specified in (1), (2), (3) and (4), above, arising outside the city but
within county in which Municipal Court is established, and also or all
cases arising outside of county wherein established if defendant resides

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BANKING AND COMMERCIAL LAWS—CALIFORNIA

or has place of business within such county. Also of cases arising
outside the city but in the county (except in municipalities having a
municipal court) specified in (1) and (3) in which a proper defendant
resides or property involved is located, where the amount involved
does not exceed $300. They have equity jurisdiction in all cases in
equity when pleaded as defensive matter or cross-complaint in any
case at law commenced in Municipal Court of which it has exclusive
jurisdiction. Municipal Courts also have certain criminal jurisdiction.
In proper case, an appeal may be taken from Municipal Court to
Superior Court.
Superior Court. The jurisdiction of the superior court is of two
kinds: 1. Original. 2. Appellate. The superior court has original
jurisdiction in all cases in equity: in all civil actions in which the sub­
ject of litigation is not capable of pecuniary estimation; in all cases at
law which involve the title or possession of real property, or the
legality of any tax, etc., and in all other cases in which the demand,
exclusive of interest or the value of the property in controversy,
amounts to $300 (except that minimum jurisdictional amount is
$1,000 in cities, towns and judicial townships of population of 30,000
or more, and is $2,000 in counties having Municipal Courts); of actions
of forcible entry and detainer, of proceedings in insolvency; of actions
to prevent or abate a nuisance; of all matters of probate, of divorce
and for annullment of marriage; and of all such special cases and
proceedings as are not otherwise provided for. They also have
power to issue writs of mandamus, certiorari, prohibition, quo war­
ranto, and of habeas corpus on petition by or on behalf of any person
in actual custody in their respective counties. Injunctions and writs
of prohibition may be issued and served on legal holidays and nonjudicial days. The superior courts have appellate jurisdiction in
cases arising in justices’ and other inferior courts in their respective
counties provided the appeal be taken within thirty days of the judg­
ment.
District Courts of Appeal. The State is divided into four appellate
districts, two of which have two divisions of three justices each, the
other two districts having three justices each. These courts have
appellate and original jurisdiction. The district courts of appeal
have appellate jurisdiction on appeal from the superior courts in
all cases at law in which the demand exclusive of interest or the value
of the property in controversy amounts to $300 or more; also in all
cases of forcible entry and detainer (except such as arise in the justices courts); in proceedings in insolvency, and in actions to prevent
or abate a nuisance; in proceedings in mandamus, certiorari and
prohibition, usurpation of office, contesting elections and eminent
domain, and in such other special proceedings as may be provided by
law (excepting in cases in which appellate jurisdiction is given to the
supreme court); also on questions of law alone in all cases prosecuted
by indictment or information to a court of record, excepting criminal
cases where judgment of death has been rendered. Said courts also
have appellate jurisdiction in all cases, matters and proceedings pend­
ing before the supreme court which shall be ordered by the supreme
court to be transferred to a district court of appeal for hearing and
decision.
Supreme Court. Has original and appellate jurisdiction. In the
exercise of original jurisdiction it shall have power to issue writs of
mandamus, certiorari, prohibition, and habeas corpus; it shall also
have power to issue all other writs necessary and proper for the
complete exercise of its appellate jurisdiction. The supreme court
has appellate jurisdiction in all cases in equity, except such as arise
in the justices' courts; also in all cases at law which involve the title
or possession of real estate or the legality of any tax, impost, assess­
ment, toll or municipal fine, also in all such probate matters as may
be provided by law; also on questions of law alone in all criminal
cases where the judgment of death has been rendered; the said court
also has appellate jurisdiction in all cases, matters and proceedings
pending before a district court of appeal which shall be ordered by the
supreme court to be transferred to itself for hearing and decision, and
in criminal cases where death is the penalty.
Depositions. The deposition of a witness out of this State may
be taken upon a commission issued from the court under the seal of
the court, upon an order of the court, or a judge or justice thereof, on
the application of either party, upon five days’ previous notice to the
other, plus one day's additional notice for each one hundred miles
of travel between residence of witness and place of deposition. If
the court be a justice’s court, the commission shall have attached
to it a certificate under seal by the clerk of the superior court of the
county to the effect that the person issuing the same was an acting
justice of the peace at the date of the commission. If issued to any
place within the United States, it may be directed to a person agreed
upon by the parties, or if they do not agree, to any notary public,
judge or justice of the peace or commissioner selected by the court,
or judge, or justice issuing it. If issued to any country out of the
United States, it may be directed to a minister, ambassador, consul,
vice-consul, or consular agent of the United States in such country,
or to any person agreed upon by the parties or judge of a court of
record in such county. The commission must authorize the com­
missioner to administer an oath to the witness. The testimony
of a witness out of the State may be taken by deposition in an action
at any time after the service of the summons or the appearance of
the defendant; in a special proceeding, at. any time after a question
of fact has arisen therein. Depositions must be taken in the form
of question and answer. The words of the witness must be written
down, in the presence of the witness, by the officer taking the dep­
osition or by some indifferent person appointed by him. It may
be taken down in short hand in which case it must be transcribed
to long hand by the person who took it down. When completed.
It must be carefully read to or by the witness and corrected by him
in any particular, if desired, by writing, or causing his corrections
to be written at the bottom of the deposition, and must then be
subscribed by the witness. Corrections must be initialed bv officer
before whom deposition is taken. If the parties agree in writing to
any other mode, the mode so agreed upon must be followed.
Depositions in this State. The testimony of the witness in this
State may be taken by depositions in an action at any time after the
service of summons or the appearance of defendant, and in a special
proceeding after a question of fact has arisen therein, in certain
enumerated cases.
Depositions for Use out of the State. Any party to an action or
special proceeding in a court or before a judge of a sister state, may
obtain the testimony of a witness residing in this State, to be used in
such action or proceeding, in the cases mentioned following; If a
commission to take such testimony has been issued from the court,
or a judge hereof, before which such action or proceeding is pend­
ing, on producing the commission to the Clerk of the Superior Court
of the county in which such witness is to be examined, with an affi­
davit satisfactory to him of the materiality of the testimony, he
may issue a subpoena to the witness, requiring him to appear and
testify before the commissioner named in the commission, at a specified
time and place. If a commission has not been issued and it appear
to a judge of the superior court, or a justice of the peace, by affidavit
satisfactory to him: 1. That the testimony of the witness is material
to either party. 2. That a commission to take testimony of such
witness has not been issued. 3. That according to the law of the
State where the action of special proceeding is pending, the deposition
of a witness taken under such circumstances, and before such judge
or justice, will be received in the action or proceeding, he must issue
a subpoena requiring the witness to appear and testify before him at
a specified time and place. Upon the appearance of the witness, the
judge or justice must cause his testimony to be taken in writing, and
must certify and transmit the same to the court or judge before whom
the action or proceeding is pending, in such manner as the law of
that State requires.
Descent and Distribution of Property. Property, both real
and personal, of an intestate passes to his heirs. Upon the death of
either husband or wife, one-half of the community property belongs


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Federal Reserve Bank of St. Louis

to the surviving spouse: the other half is subject to the testamentary
disposition of the decedent, and in the absence thereof, goes to the
surviving spouse. On death of the husband where the estate is less
than $2,500 the whole estate may be set off to the widow. Community
property is all property acquired by the husband and wife during their
marriage, which does not include property acquired by either gift,
bequest, devise, or descent, which is separate property. Dower inter­
est does not exist. The separate estate is distributed as follows: If
the decedent leaves a surviving husband or wife and only one child,
or the lawful issue of one child, in equal shares to the surviving hus­
band or wife and child or issue of such child. If a surviving husband
or wife and more than one child living, or one child living and the
lawful issue of one or more deceased children, one-third to the sur­
viving husband or wife and the remainder in equal shares to the chil­
dren and to the lawful issue of any deceased child by right of repre­
sentation. But if there be no child living, the remainder goes to all
the lineal decendants, and if they are in the same degree of kindred
to the decedent they share equally, otherwise by right of representa­
tion. If the decedent leaves no surviving husband or wife, the whole
estate goes to the issue—the issue of children taking by right of repre­
sentation. If there is no issue the estate goes one-half to the surviving
husband or wife and the other half to the father and mother in equal
shares, or, if one be dead, to the survivor; if there be no father or
mother, then their one-half goes in equal shares to the brothers and
sisters, or to their representatives. If there is no issue, or husband
or wife, the estate goes to the father and mother, or the survivor, or,
if both be dead, then in equal shares to the brothers, and to the chil­
dren of any deceased brother or sister by right of representation. If
the decedent leaves a surviving husband or wife, and neither issue,
father, mother, brother, nor sister, the whole estate goes to the sur­
viving husband or wife. If the decendent leaves neither issue, husband
wife, father, mother, brother, nor sister, the estate must go to the
next of kin in equal degree. Illegitimate children inherit from mother,
also from father if recognized in writing but can only inherit directly
and not by representation. If, however, deceased leave no issue and
(1) the property was community property of decedent and a previously
deceased spouse, or (2) the separate property of a previously deceased
spouse, and came to decedent from said spouse by gift, descent or be­
quest, it goes to the children of such deceased spouse and to their
descendents; if no such issue then one-half each to the heirs of decedent
and the previously deceased spouse. These are i he principal pro­
visions of the law of succession. Tenancy by the courtesy is not
known to our law. If the person dies testate all property passes as
directed by the will.
Executions. May issue any time within five years from entry of
Judgment and after lapse of five years the judgment may be enforced
or carried into execution by leave of court upon motion, or by judg­
ment for that purpose, founded upon supplemental proceedings.
No right of stay exists except by order of the court in its discretion.
Execution may issue against the property of a judgment debtor
after his death, only li the judgment be for recovery or real of per­
sonal property, or the enforcement of liens thereon. Heal property
may be redeemed within one year, personal property not at all
Exemptions. The following property is exempt from execution1. Chairs, tables, desks, and books, to the value of $200. 2. Neces­
sary household, table and kitchen furniture belonging to the judgment
debtor, including one sewing machine, stoves, stove-pipes and furni­
ture, wearing apparel, beds, bedding and bedstead, hanging pictures,
oil paintings and drawings drawn or painted by any member of the
family, and family portraits, and their necessary frames, provisions
and fuel actually provided for individual or family use sufficient
for three months, and three cows and their sucking calves, four hogs
with their sucking pigs, and food for such cows and hogs for one
month, one piano, one shotgun, and one rifle. 3. The farming uten­
sils or implements of husbandry not exceeding in value the sum of
$1,000; also two oxen or two horses, or two mules, and their harness;
one cart or buggy and two wagons, and food for such oxen, horses,
or mules for one month; also all seed, grain, or vegetables, actually
provided, reserved or on hand for the purpose of planting or sowing
at any time within the ensuing six months, not exceeding in value
the sum of $200, and seventy-five bee hives, and one horse and ve­
hicle belonging to any person who is maimed or crippled, and the
same is necessary in his business. 4. The tools or implements oi
mechanic or artisan necessary to carry on his trade; the notarial
seal, records, and office furniture of a notary public; the instruments
and chest of a surgeon physician, surveyor, or dentist, necessary to
the exercise of their profession, witn their professional libraries and
necessary office furniture; the professional libraries of attorneys
Judges, ministers of the gospel, editors, school teachers and music
teachers and their necessary office furniture, including one safe and
one typewriter, also the musical instruments of music teachers ac­
tually used by them in giving instructions; and all the indexes, ab­
stracts, books, papers, maps, and office furniture of a searcher of
records necessary to be used in his profession; also the typewriters
or other mechanical contrivances employed for writing in type ac­
tually used by the owner thereof for making his living; also one
bicycle when the same is used by its owner for the purpose of carrying
on his regular business, or when the same is used for the purpose
of transporting the owner to and from his place of business. 5. The
cabin or dwelling of a miner not exceeding in value the sum of $500also his sluices, pipes, hose, windlass, derrick, cars, pumps, tools
Implements, and appliance necessary for carrying on any mining
operations, not exceeding in value the aggregate sum of $500- and
two horses, mules, or oxen, with their harness, and food for same
for one month, when necessary to be used in any whim, windlass
derrick, car, pump, or hoisting gear, and also his mining claim, actu­
ally worked by him, not exceeding in value the sum of $1,000. 6
Two horses, two oxen, or two mules, and their harness, and one cart
or wagon, one dray or truck, one coupe, one hack or carriage for one
or two horses, by the use of which a cartman, truckman, huckster
peddler, hackman, teamster, or other laborer habitually earns his
living, and one horse with vehicle and harness, or other equipments
used by a physician, surgeon, constable or minister of the gospel in
the legitimate practice of his profession or business, with food for
same for one month. 7. One fishing boat and net, not exceeding
the total value $500, the property of anv fisherman bv the lawful
use of which he earns a livelihood. 8. Poultry, not exceeding In
value $75. 9. Seamen’s and seagoing fishermen’s wages and earn­
ings not exceeding $300. 10. The earnings of the judgment debtor
for his personal services rendered at any time within thirty days
next preceding the levy of execution or attachment, where it appears
by the debtor's affidavit or otherwise, that such earnings are neces­
sary for the use of his family, residing in this State supported in whole
or in part by his labor; but where debts are incurred by any such
person, or his wife or family for the common necessaries of life or
have been incurred at a time when the debtor had no family residing
in this State, supported in whole or in part by his labor, or incurred
for personal services rendered by any employee or former employee
the one-half of such earnings above mentioned are nevertheless sub­
ject to execution, garnishment, or attachment to satisfy debts so
incurred. 11. The shares held by a member of a homestead association
duly incorporated, not exceeding in value $1,000. if the person holding
the share is not the owner of a homestead under the laws of this
State. 12. All the nautical instruments and wearing apparel of
any master, officer, or seaman of any steamer or other vessel. 13 All
fire engines, hook and ladders, with carts, trucks, carriages, hose
buckets, implements, and apparatus thereunto appertaining: and
all furniture and uniforms of any fire company or department or­
ganized under any law of this State. 14. All arms, uniforms and
accoutrements required by law to be kept by any person, and also
one gun to be selected by the debtor. 15. All court houses jails
and town, county, and State buildings; all public buildings, grounds’
places, etc. 16. All material purchased for use in the construction’
alteraton, etc., of any building, mining claim, etc., not exceeding the

BANKING AND COMMERCIAL LAWS—CALIFORNIA
value of $1,000, as long as in good faith the same is about to be
applied to such contsruction, alteration, etc. 17. All machinery,
tools, and implements necessary in and for boring, sinking, putting
down, and constructing surface or artesian wells; also the engines
necessary for operating such machinery, implements, tools, etc.; also
all trucks necessary for the transportation of such machinery, tools,
implements, engines, etc., to the value of $1,000. 18. All moneys,
benefits, privileges, or immunities accruing, or in any manner grow­
ing out of any life insurance on the life of the debtor, if the annual
premiums paid do not exceed $500, and if premium exceeds $500 an
exemption exists in the proportion that the $500 bears to total
premium. 19. Shares of stock in any building and loan association
to the value of $1,000. 20. All money received by residents as a
pension from the United States government, or as a pension or retire­
ment salary from the State or City, county or public board, whether
in possession or deposited or invested. 21. Money held, controlled
or in process of distribution by the State or political subdivision
derived from contributions from the State, political subdivision, or
by any officer or employer thereof for retirement or pension purpose
or payment of death benefits. No article, however, or species, of
property mentioned in this section, is exempt from execution issued
upon a judgment recovered for its price, or upon a judgment of fore­
closure of a mortgage or other lien thereon. (For Homestead Exemp­
tions, see Homestead.)
Fraud. (For Fraudulent Debtors, see Arrest.) Any contract
obtained through fraud is voidable. Consent is deemed to have
been obtained through fraud onl£ when it would not have been given
had such cause not existed. Actual fraud consists In the suggestion
as a fact of that which is not true, the positive assertion of that which
is not true in a manner not warranted by the information of the person
making it though he believes It to be true, the suppression of that
which is true by one having knowledge of it, and promises made with­
out any intention of performing, or any other act fitted to deceive.
Constructive fraud, consists of any breach of duty, which without an
actual fradulent Intent, gains an advantage of the person in fault
by misleading another to his prejudice. Actual fraud is always a
question of fact.
Fraudulent Sales and Conveyances. Sale, transfer, or assign­
ment of a substantial part of stock in trade, except in ordinary course
of business, and sale, transfer, assignment, or mortgage of fixtures or
equipment of merchant is void as to existing creditors unless seven
days prior thereto seller or purchaser record with County Recorder a
notice of such intended sale, transfer, etc. The notice must conform
to certain statutory requirements.
Garnishment. Upon receiving instruction In writing from the
plaintiff or his attorney that any person has In his possession, or under
his control, any credits or other personal property belonging to the
defendant or is owing any debt to the defendant, the sheriff must
serve upon such person a copy of the writ and a notice that such
credits, or other property or debts, as the case may be, are attached
In pursuance of such writ. All persons having any such property
at the time of serving of such writ, unless it is delivered up or trans­
ferred or paid to the sheriff, shall be liable to the amount of such
credits, property, or debts, until the attachment be discharged, or
any Judgment by him recovered be satisfied. No garnishment upon
a bank is effective unless notice of the garnishment and a copy of the
writ is left at the particular branch where the money or evidences of
debt are actually located.
Holidays. Are every Sunday, the first day of January, 12th day
of February, the 22nd day of February, the 30th day of May. the
4th day of July, the 9th day of September, the 1st Monday in Sep­
tember, 12th day of October, November 11th, the 25th day of Decem­
ber, every day on which an election is held throughout the state, and
every day appointed by the President of the United States or by the
governor of the State, for a public fast, thanksgiving or holiday. If
the first day of January, the 12th day of February, 22nd day of Feb­
ruary, the 30th day of May, 4th day of July, 9tti day of September,
12th day of October, November llth, or the 25th day of December
fall on a Sunday, the Monday following is a holiday. Every Saturday
from twelve o'clock noon until twelve o’clock midnight is a holiday
as regards the transaction of business in the public offices of this
State, and also in political divisions thereof where laws, ordinances
or charters provide that public offices may be closed on holidays;
provided this shall not be construed to prevent or invalidate the
issuance, filing, service, execution, or recording of any legal process or
written instrument whatever on such Saturday afternoons. Injunc­
tions and writs of prohibitions may be issued and served on any day.
Contracts made on a holiday are valid.
Homestead. The homestead consists in the Interest of the claim­
ant, divided or undivided, in the dwelling house in which the claimant
resides, and in the land on which the same is situated, selected, if the
claimant be married, from community property, or the separate
property of the husband, or. with the consent of the wife from her
separate property. When the claimant is not married, but is the head
of a family, the homestead may be selected from an^ of his or her
property. The homestead can not be selected from the separate
property of the wife without her consent, shown by her making or
joining the declaration of homestead. The homestead is exempt from
execution or forced sale, except in satisfaction of judgments obtained.
1. Before the declaration of homestead was filed for record, and which
constitutes liens upon the premises. 2. On debts secured by mechanics'
contractors’, sub-contractors’, artisans’, architects’, builders’, labor­
ers’ of every class, materialmen’s or vendors’ liens upon the premises.
3. On debts secured by mortgages or deeds of trust on the premises,
executed and acknowledged by the husband and wife or an unmarried
claimant. 4. On debts secured by mortgages on the premises, executed
and recorded before the declaration of homestead was filed for record.
In cases not enumerated above, in which, after a judgment has been
docketed against the homestead claimant, and an execution for its
enforcement levied on the homestead, it may be shown by an appraise­
ment applied for to, and ordered by, the court, after proper proceed­
ings, that the homestead exceeds in value the amount of homestead
exemption. Then steps may be taken, if it can be done without
material injury to the land, to divide the property and reach the excess.
The homestead of a married person can not be conveyed or encum­
bered unless the instrument by which it is conveyed or encumbered
is executed and acknowledged by both husband and wife. Home­
steads may be selected and claimed: 1. If not exceeding $5,000 in
value by any head of a family. 2. If not exceeding $1,000 in value, by
another person. Upon death of either spouse, if homestead is selected
from community property or from separate property of spouse joining
therein, title thereto vests in survivor otherwise to the heirs or devises
of the person whose property was selected.
Husband and Wife. The husband is the head of the family.
He may choose any reasonable place or mode of living, and the wife
must conform thereto. In other respects their interests are separate.
Neither husband nor wife has any interest in the separate property
of the other, and either may enter into any engagement with the
other, or with any other person, respecting property, which either
might if unmarried. All property of either, owned by him or her
before marriage, and that acquired afterward by gift, bequest, devise
or descent, is the separate property of such person. All other prop­
erty acquired after marriagb by either husband or wife or both, is
community property, except that a married woman may acquire and
hold shares in building and loan associations as her separate property;
may transfer shares of corporate stock generally as if unmarried, and
whenever any other property real or personal is conveyed to, or any
interest therein or encumbrance acquired by a married woman by an
instrument in writing the presumption is that the same is her separate
property. The husband has the management and control of the
community property, with absolute power of disposal other than
testamentary, provided that he cannot make a gift of the same or
convey the same without valuable consideration, unless the wife


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2145

consents In writing, either personally or by her authorized agent, and
provided that in the execution of any instrument by which community
real property, or any interest therein is leased for a longer period than
one year, or is sold, conveyed, or encumbered, the wife must join with
him in the execution of any such instrument. The community prop­
erty is not liable for the contracts of the wife made after marriage,
unless secured by a pledge or mortgage thereof executed by the hus­
band. Except for the necessaries of life the husband is not liable for
damages or torts committed by wife except in a case where he would
be jointly liable with her if the marriage did not exist. The separate
property of the husband is not liable for the debts of the wife con­
tracted before marriage,and the separate property of the wife is not
liable for the debts of her husband, but is liable for her own debts
contracted before or after marriage. A husband and wife may hold
property as joint tenants, tenants in common, or as community prop­
erty. Upon death of husband or wife intestate, the entire community
property goes to the survivor. Either the husband or the wife may
subject one-half of the community property to testamentary disposition
by will.
Interest. The legal rate of interest is 7 per cent and is due upon
Judgments after rendition and upon other obligations unless there
is an express contract in writing fixing a different rate. The parties
may agree, in writing, to a higher rate of interest, but not exceeding
12 per cent for one year and not exceeding that rate for a longer or
shorter time. They may also agree in writing for compound interest
provided the maximum rate of 12 per cent is not exceeded. An
exception is provided allowing a greater interest rate to personal
property brokers on loans not exceeding $300. Usury is a misde­
meanor and words a forfeiture of all interest and liability for treble
damages.
Judgments. (See Actions.) Upon filing the judgment roll, which
is a record of the proceedings in the case, it must be docketed by the
clerk, when the abstract of judgment or of the decree of any court
of record of California, or of the United States, not stayed on appeal,
certified by the Clerk, is filed with the recorder of any county, it
becomes a lien upon any real property of the judgment debtor then
owned by him or acquired before expiration of the lien, and not
exempt from execution. This lien continues for five years, unless the
enforcement of the judgment be stayed on appeal. A judgment is
barred by the act of limitation within five years, unless revived by
leave of court upon motion or by an action upon the judgment.
Judgment must first be satisfied out of property of the judgment
debtor which has been attached and in the custody of the sheriff.
Liens. Mechanics, material-men. contractors, sub-contractors,
artisans, architects, machinists, builders, miners, teamsters, dray­
men and all persons and laborers of every class performing labor
upon or furnishing material to be used in or furnishing appliances,
teams ana power contributing to the construction, alteration, or
repair of any building, wharf, bridge, ditch, flume, aqueduct, well,
tunnel, fence, machinery, railroad, wagon road, or other structure,
have liens upon the property upon which they have worked or fur­
nished material, and any person performing labor in a mining claim
has a lien upon the same, and the works owned and used by the owners
for reducing the ores from such mining claim, for the work or labor
done. The common carrier has a lien upon the luggage of a passenger
for the payment of his fare. One who sells real property has a ven­
dor’s lien thereon. Improvers of personal property, depositaries for
hire, veterinary surgeons, garages, livery stable keepers and persons
pasturing horses or stock, have a special lien, dependent upon posses­
sion. Factors, banks, and laundry proprietors have a general I ien,
dependent on possession, on any personal property in their hands.
Seaman have general liens independent of possession. Owners of
animals used for propagating purposes have a lien for the agreed
price upon the offspring. Loggers rendering services upon logs,
bolts and other timber have a lien thereon for the amount due for
their personal services.
Every person performing work or labor in, with, about, or upon any
threshing machine or engine, horse-power, wagon, or other appliance
thereof, while engaged in threshing, has a lien thereon to the extent
of the value of his services, for ten days after ceasing work or labor,
provided, within that time, an action is brought to recover tbe amount
of the claim, persons repairing or altering any personal property have
a lien for the reasonable value of such service.
Limitations. If real estate is held adversely for five years, such
adverse possession ripens into title if claimant pays taxes for five years,
except against infants and persons under disability. The periods pre­
scribed for the commencement of actions other than for the recovery
of real property, are as follows: Within five years; (1) An action
upon a judgment or decree of any court of the United States, or of
any State within the United States. (2) An action for mesne profits
of real property. W’ithin four years: (1) An action upon any con­
tract, obligation or liability founded upon an instrument in writing,
executed in this State. (2) An action to recover a balance due upon
a mutual open and current count or upon an open book account.
Within three years: (1) An action upon a liability created by statute,
other than a penalty or forfeiture. (2) An action for trespass upon real
property. (3) An action for taking, detaining or injuring any goods
or chattels, including actions for the specific recovery of personal
property. (4) An action for relief on the ground of fraud or mis­
take, the cause of action in such case not to be deemed to have accrued
until tbe discovery by the aggrieved party of the facts constituting
fraud or mistake: Within two years: (1) An action upon a contract,
obligation or liability not founded upon an instrument of writing,
(2) An action on a debt, liability or obligation evidenced by an abstract,
guarantee or certificate of title; and such action shall not be deemed
to have accrued until the discovery of the loss or damage. (3) An
action against a sheriff, coroner, or constable, upon a liability Incurred
by the doing of an act in his official capacity, and in virtue of his
office, or by the omission of an official duty, including the non-pay­
ment of money collected upon an execution; but this subdivision doe#
not apply to an action for an escape. Within one year: (I) An action
upon a statute for a penalty or forfeiture, when the action is given to
an individual or to an individual and the State, except when the
statute imposing it prescribes a different limitation. (2) An actloo
upon a statute, or upon an undertaking in a crimina action, for a
forfeiture or penalty to the people of this State. (3) An action for
libel, slander, assault, battery, false imprisonment, or seduction, or
for injury to or for the death of one caused by the wrongful act or
neglect of another, or by a depositor against a bank for the paymeni
of a forged or raised check, or a check that bears a forged or unauthor­
ized endorsement. (4) An action against a sheriff, or other officer for
the escape of a prisoner arrested or imprisoned on civil process.
(5) An action against a municipal corporation for damages or injuries
to property caused by a mob or riot. Within six months, (l) An
action to recover property seized by tax collector. (2) To recover
corporation stock sold for delinquent assessment. To actions brought
to recover money or other property deposited with any bank, banker,
trust company, or savings and loan society, there is no limitation.
If when the cause of action accrues against a person, he is out of the
State, the action may be commenced within the term herein limited,
after his return to the State, and if, after the cause of action accrues,
he departs from the State, the time of his absence is not part of the
time limited for the commencement of the action. And if the person
entitled to bring the action be, at the time the action accrued, either
a minor, insane, imprisoned for a term less than life, or a married
woman, and her husband is a necessary party with her in commencing
such action, the time of such disability is not a part of the time limited
for the commencement of the action. No acknowledgment or prom­
ise is sufficient to take a case out of the operation of the statute of
limitations, unless the same is in writing, signed by the party to be
charged. Part payment will not take the case out of the statute of
limitations. Where a cause of action has arisen in another State,
and would be barred by the statute of limitations of that State, an
action cannot be maintained here, except in favor of one who has

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BANKING AND COMMERCIAL LAWS—COLORADO

been a citizen of this State and has held the cause of action from the
time it accrued. There is no limitation upon actions to recover money
or property with banks or trust companies. (See Accounts.)
Married Women. A married woman may be sued without her
husband being Joined as a party and may sue without her husband
being joined as a party in all actions, including those for injury to
her person, libel, slander, false imprisonment, or malicious prosecution,
or for the recovery of her earnings or concerning her right or claim to
the homestead property. A married woman may become a sole
trader by the judgment of the superior court of the county in which
she has resided for six months next preceding the application. The
husband of the sole trader is not liable for any debts contracted by
her in the course of her sole trader’s business unless contracted upon
his written consent. A married woman may convey without consent
of her husband, and is not liable for the debts of her husband, but is
liable for her own debts contracted before or after her marriage.
She may contract as a femme sole so as to bind her separate property.
The wife may make a will of both her separate property and one-half
the community property. The earnings of the wife are not liable for
the debts of her husband unless it be community property.
Mechanics’ Liens. (See Liens.)
Mortgages. Any interest in real property which is capable of
being transferred may be mortgaged. A mortgage can be created,
renewed, or extended only by writing executed with the formalities
required in the case of a grant of real property. It requires the
signature of the wife except as to property which is the separate
estate of the husband, and in practice the wife’s signature should
always be required. Every transfer of an interest in real property,
other than in trust, made only as the security for the performance
of any act, is to be deemed a mortgage, and the fact that the transfer
was made subject to defeasance on a condition may, for the purpose
of showing such transfer to be a mortgage, be proved (except as against
the subsequent purchaser or encumbrancer for value and without
notice) although the fact does not appear by the terms of the instru­
ment. A mortgage is a lien upon everything that passes by a grant
of the property. A mortgage does not entitle the mortgagee to the
possession of the property. The assignment of a debt secured by a
mortgage carries with it the security. When a mortgage is satisfied
or the mortgage indebtedness paid, the mortgagee must satisfy the
mortgage of record under penalty. A mortgagee may foreclose the
right of redemption of the mortgagor unless expressly stipulated the
mortgage is not a personal obligation on part of mortgagor. (See
also Trust Deeds.)
Notes and Bills of Exchange. (See Bills and Notes.)
Pledge. (See Collaterals.)
Powers of Attorney. An attorney in fact may be appointed for
any purpose for which an agency can lawfully be created. Powers of
attorney can only be conferred by an instrument in writing subscribed
by the principal which must particularly specify the powers con­
ferred. If the instrument contains a power to convey or execute
instruments affecting real property, it must be duly acknowledged
and must be recorded in the county within which the real property
to be conveyed or affected is situated. No such instrument which has
been so recorded is revoked by any act of the party by whom it was
executed, unless the instrument containing such revocation is also
acknowledged or proved, certified, and recorded in the same office
in which the instrument containing the power was recorded. When
an attorney in fact executes an instrument transferring an estate
in real property, he must subscribe the name of his principal to it.
and his own name as attorney in fact.
Probate Law. (See Administration of Estates, Claims against
Estates of deceased persons. Descent and Distribution.) The superior
court has jurisdiction of proceedings in probate, and such proceedings
must be instituted (1) In the county in which the decedent was a
resident; (2) in the county in which he may have died, leaving estate
therein, he not being a resident of the State; (3) in the county in
which any part of the estate may be, if the decedent died out of the
State and was not a resident. (4) In any county in which any part
of the estate may be, or the decedent not being a resident of the
State nor leaving an estate in the county of death. (5) In other cases
where application is first made, any person interested may petition
for probate of a will or may contest such probate within one year.
An inventory and appraisement is required of the executor or admin­
istrator within three months. Upon the return of the inventory the
court may set apart for use of the surviving husband or wife, or of
the minor children, all the property exempt from execution including
any homestead selected, providing the same was selected from the
common property or from the separate property of the person select­
ing or joining in the selection of the same. If none has been selected,
the court must select, designate and set apart and cause to be recorded
a homestead for the use of the surviving husband or wife, or of the
minor children, or if there be no surviving husband or wife, then for
the use of the minor children out of the common property, “or out
of the real estate owned in common by the decedent and the person
or persons to whom the homestead is set apart, or if there be no com­
mon property and no such jointly owned property, then out of the
real estate belonging to the decedent as his own separate property.
Property so set apart is not subject to further administration. If
upon the return of the inventory it appears that the value of the
whole estate does not exceed $2,500, the court may set apart the
whole of the estate for the use and support of the family of the
deceased.
Protest. (See Bills and Notes.)
Replevin. There is no action of replevin in this State, but the
action of claim and delivery substantially takes its place. The
plaintiff in an action to recover the possession of personal property
may at the time of issuing the summons, or at any time before answer,
claim the delivery of such property. An affidavit must be made by
the plaintiff or by some one in his behalf showing that the plaintiff
Is the owner of the property, or entitled to its possession, that the
property is wrongfully detained by the defendant, the alleged cause
of detention thereof, and that it has not been taken for a tax, assess­
ment or fine, or seized under an execution or attachment, or if so
seized that it is exempt; also the actual value of the property. Plain­
tiff must also give a bond in double the value of the property. The
defendant may give to the sheriff a written undertaking in double
the value of the property, and retain the same, but in case he fails
so to do the property is deliverea to the plaintiff. Third parties
may upon affidavit of ownership, claim such property and secure
Its release unless plaintiff bond against such claim. The judgment
in such action is in the alternative for a return of the property or
for Its value in case a delivery can not be had.
Sale of Stock Shares. Permit must be obtained from State Cor­
poration Commissioner.
Statute of Frauds. A will must be in writing, except a nun­
cupative will. (See Wills.) An agreement not to be performed
within a year from making it must be in writing; also a special prom­
ise to answer for the debt, default, or miscarriage of another with
certain statutory exception which in the State are similar to those in
most other jurisdictions; also agreements made in consideration of
marriage other than a mutual promise to marry; also an agreement
for the sale of goods and chattels or things in action at a price not
less than $500, unless the buyer accept and receive part of the same
or pay any part of, the consideration. No estate in land will pass
other than leases not to exceed one year, unless in writing. An agree­
ment authorizing or employing an agent or broker to purchase or
sell real estate for compensation or for a commission; an agreement


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Federal Reserve Bank of St. Louis

by its terms not to be performed in the lifetime of the promisor or
to make, devise or bequeath or make any provisions for any person
by will, must be in writing. No evidence is admissable to charge
a person upon representations as to the credit of another, unless the
representations be in writing. However, where promisor has received
property to apply pursuant to promise or a discharge of an obligation
in consideration of the promise, or where a creditor parts with value
or where the new promise is substituted for the old debt, or where
levy or execution is released or there is benefit moving to promise
from any party or where a factor undertakes for a commission to
guarantee a sale, contracts to answer for the default of another need
not be in writing. Transfer of personal property capable of manual
delivery, except wine in cellars and tanks, when not accompanied
by delivery and change of possession are deemed fraudulent as to third
parties unless notice of intention of sale is recorded seven days before
transfer is made in accordance with law.
Supplementary Proceedings. When an execution Is returned
unsatisfied, the judgment creditor can obtain an order requiring the
judgment debtor to appear and answer concerning his property before
the judge or referee appointed by him, also, in case after the issuing
of an execution, upon proof by affidavit that the judgment debtor has
property which he unjustly refuses to apply toward the satisfaction
of the judgment, the judge may make the order, and instead thereof.
If it appear that the debtor is about to abscond, he may. by order of
the judge, be arrested and required by him to give security for the
judgment, or that he will attend from time to time during the pen­
dency of the proceedings, and that he will not in the meantime dlsose of any portion of his property, and in default of security he may
e committed to prison.
Taxes. On the fifth day of December of each year taxes become
delinquent, except the last installment of the real property taxes, and
thereafter 10 per cent is added for delinquency; provided, that if they
be not paid before the 20th day of April next succeeding, 5 per cent
is added for delinquency. On the 20th day of April, of each year, all
the unpaid portion of the remaining one-half of the taxes on all real
property is delinquent, and thereafter 5 per cent is added for delin­
quency; and provided further, that the entire tax on any real property
may be paid at the time the first installment as above provided is due
and payable; and provided further, that the taxes on all personal
property, unsecured by real property, shall be due and payable
immediately after the assessment of said personal property is made.
Public Utility corporations are taxed for the support of the State;
other property is taxed for county and city purposes.
Trust Deeds. Trust deeds as security are in general use, and are
usually preferred to mortgages by banks and other lenders, as a right
of redemption does not exist after foreclosure of trust deed by trustee’s
sale. Also, the method of foreclosure is more simple. To foreclose
the beneficiary must record with the County Recorder a three-months
notice of his election to cause the property to be sold and thereafter
the trustee must give notice of time and place of sale by posting in
statutory manner and by publishing copy once a week for twenty
days in newspaper of general circulation. Should such sale result in a
deficiency, judgment for same may be recovered in appropriate action.
Wills. Every person ever the age of eighteen years, of sound
mind, may, by last will, dispose of all his estate, real and personal.
A married woman may dispose of all her separate estate by will with­
out the consent of her husband, and may alter or revoke the will in like
manner as if she were single; she may also under certain conditions,
dispose of by will one-half of the community property. Her will must
be executed and proved in like manner as other wills. Every will
other than a nuncupative will must be in writing, and every will other
than an holographic will and a nuncupative will, must be executed and
attested as follows: 1. It must be subscribed by the testator himself,
or some person in his presence, and by his direction must subscribe
his name thereto. 2. The subscription must be made in the presence
of the attesting witnesses, or acknowledged by the testator to them
to have been made by him or by his authority. 3. The testator
must, at the time of subscribing or acknowledging the same, declare
to the attesting witnesses that the instrument is his will, and 4. There
must be two attesting witnesses, each of whom must sign his name
as a witness at the end of the will, at the testator’s request, and in
his presence. An holographic will is one that is entirely written, dated,
and signed by the hand of the testator himself. It is subject to no
other form, and may be made in or out of this State, and need not be
witnessed. A witness to a will should always write his name and
residence. All devises or gifts to a subscribing witness are void unless
there are two other competent subscribing witnesses unless such
witness is entitled to a share, if there had been no will. No will made
out of this State is valid as a will in this State, unless executed accord­
ing to the provisions of the code, except that a will made in a State or
country in which the testator is domiciled at the time of his death,
and valid as a will under the laws of such State or country is valid in
this State as to personal property. Wills proven out of state may be
recorded in county where testator has left over estate.
Bequests for charity are void unless made more than thirty days
before death and must in no case exceed more than one-third of the
estate unless there are no legal heirs, except that bequests to the
State or a political subdivision or to educational institutions exempt
from taxation, are not limited to one-third. Also, bequests to charity
by will made six months or more before death are not so restricted
unless there are living spouse, child, grandchild or parent, and these
may in writing name the restriction. Wills are revoked by marriage
unless provision for the same or an intention not to provide clearly
appears.

SYNOPSIS OF

THE LAWS OF COLORADO
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Mr. Bently M. McMullin, Attorney at Law, 236 Conti­
nental Oil Bldg., Denver. (See Card in Attorneys List.)
Acknowledgments. Of deeds and Instruments concerning real
estate, may be taken as follows: —
1. Within this State, before any judge, clerk, or the deputy clerk
of any court of record, clerk, and recorder of any county, or his deputy,
or notary public, or before any justice of the peace within his county.
2. Out of this State and within the United States before the
secretary of any such State or Territory, the clerk of any court of
record, any notary public, or any commissioner of deeds for any
such foreign State or Territory appointed under the laws of this
state; before any other officer authorized by the laws of any such
State or Territory to take and certify such acknowledgment; provided,
there shall be affixed to the certificate of such officer, other than
those above enumerated, a certificate by the clerk of some court
of record of the county, city or district wherein such officer resides,
under the seal of such court, as to the official capacity, true signature
and authority of the person certifying such acknowledgment.
3. Out of the United States, before any judge, clerk, or deputy

BANKING AND COMMERCIAL LAWS—COLORADO
clerk, of any court of record of any foreign kingdom, empire, republic
state, principality, province, colony, island possession or bailiwick,
before the chief magistrate or other chief executive officer of any
province, colony, island possession or bailiwick, before the mayor
or chief executive officer of any city, town, borough, county or mu­
nicipal corporation, having a seal, or before any ambassador, min­
ister, consul, consular agent, charge d'affaires, commercial agent,
or any vice consul, etc., or any diplomatic consular or commercial
agent or representative, or deputy of any thereof, of the United
States or any other government or country appointed to reside in
the foreign country or place where the acknowledgment is made,
each and all certifying same under his official seal.
4. Out of the State, and within any colony, island possession
or bailiwick of the United States, before any such officer as above
enumerated in relation to acknowledgments in foreign countries
(except ambassadors, etc.) or before any notary public, having a
seal.
5. The statutory form and manner of acknowledgment are as
follows:
STATE OF...
COUNTY OF
The foregoing instrument was acknowledged before me this............
day of......................... 19...., by...............................................................(if by
natural person or persons here insert name or names; if by person
acting in representative or official capacity or as attorney-in-fact,
then insert name of person as executor, attorney-in-fact or other
capacity or description; if by officer of corporation, then insert name
of such officer or officers as the president or other officers of such
corporation, naming it. If acknowledgment is taken by notary
public, the date of expiration of commission shall also appear on
the certificate.)
WITNESS my hand and official seal.
Title of Officer.
Actions. The distinction between the forms of actions at law and
suits in equity is abolished. All actions must be prosecuted by the
real party in interest, and are governed by a code of civil procedure.
Administration of Estates. All demands not exhibited in six
months are barred, unless such creditor can find other estate of the
deceased not inventoried. Claims are classified for payment, ordinary
debts being in the fifth class. Creditors having liens can foreclose
at any time by court action, but cannot foreclose without court
action within one year without permission of court. Administration
is granted to surviving husband or widow, or next of kin of an intestate,
if they will accept or are not disqualified; if so such relative appears
within twenty days after death of intestate, administration may be
granted to a creditor; if no creditor appears in ten days after twenty
days from death of intestate, or if next of kin files written relinquish­
ment county judge may select administrator. In counties having a
population of more than 50,000 on default of relatives administration
is made by public administrator. An abbreviated form ot adminis­
tration is provided for estates of $2,000 or less. (See Wills; Husband
and Wife; Descents and Distributions.)
Agent. (See Partnerships.)
Aliens. Are under no property or business disqualification.
Arbitration. Differences may be submitted to arbitration by
consent of the parties in the form prescribed by the code of civil
procedure, and a judgment may be entered by the clerk of the District
Court upon the finding of the arbitrators.
Arrest. Imprisonment for debt upon any contract is abolished.
In civil actions founded upon tort, where the finding is in favor of the
plaintiff and the verdict states that defendant was guilty of fraud;
malice, or willful deceit, execution may issue against the body of
the defendant, but not where the defendant shall have been con­
victed in a criminal proceeding for the same wrong. Imprison­
ment shall not exceed one year, and the prisoner is released upon
payment of the debt. The writ of ne exeat is granted under proper
circumstances.
Assignments. Assignments for the benefit of creditors are pro­
vided for. Assignments of wages not due at the time of the assign­
ment, or of other sums to become due to the assignor, are invalid unless
recorded with the recorder of the county where the wages are to be
earned, or the sums are to become due, within five days from the date
thereof. If the assignor is a married man or woman, residing with the
wife or husband, he or she must join in the assignment. There are also
provisions regulating assignments to wage-brokers and others.
Attachments. In actions on contracts, express or implied, or in
tort against a non-resident, the plaintiff may have the defendant’s
property attached, upon filing a bond in double the amount sued for,
with affidavit of plaintiff, his agent or attorney, setting forth the
amount and nature of the debt claimed, and one or more of the follow­
ing grounds of attachment: 1. That defendant is a non-resident.
2. A foreign corporation. 3. A corporation whose chief office or
business is out of this State. 4. Is evading service, or has been absent
from State for four months, while debt has been overdue. 5. Is about
to fraudulently remove his property out of State. 6. Has fraudu­
lently conveyed, or (7) fraudulently concealed or removed or disposed
of his property, or (8) and (9) is about to do either, or has departed
or is about to depart from this State, with the intention of having
his effects removed from this State. 10. Has failed or refused to pay
the price or value of any article delivered to him to be paid for upon
delivery, or (11) of any work or labor performed, or for any service
rendered by plaintiff, for defendant, to be paid for upon completion.
12. That the defendant fraudulently contracted the debt, or procured
the money or property of the plaintiff. In justice courts, the fact
that the debt is for farm products, house rent, househood furniture
and furnishing, fuel, groceries and provisions, clothing and wearing
apparel for the debtor or his family, is additional ground for attach­
ment. Garnishee process will issue in aid of attachment when money
or property of the debtor is found in possession of third persons.
Banks, State. No bank hereafter organized shall do business
until authorized to do so by the State Bank Commissioner, unless
it shall have a bona fide minimum paid-up cash capital of $25,000
and a paid-in cash surplus of 10 per cent of the capital stock. Reserves
of 15 per cent must be maintained. Generally no bank may take
as security a lien on any part of its capital stock; nor take as security
a lien on any part of the capital stock of other banks; nor take as
security a lien for any person on more than 25 per cent of the total
shares of any other bank; not may it hold or purchase any portion
of its own stock, or of the capital stock of any other corporation,
unless such purchase is necessary to prevent loss upon a debt previ­
ously contracted in good faith, or in other peculiar circumstances.
Stock so purchased must be sold within three years, and sooner if
this can be done without impairing the bank’s investment. Share­
holders in banks, savings banks, trust deposit and security associations
shall be held individually responsible for debts, contracts, and engage­
ments of said association in double the amount of the par value of
the stock owned by them respectively. Any banker, bank officer
or employee who receives money or property after he shall have had
knowledge of the insolvency of said bank, shall be deemed guilty
of felony, and, on conviction, punished by imprisonment in the peni­
tentiary for not more than twenty years, and in addition shall be
Individually responsible for the propertv received. Failure or the bank
or banker within thirty days after receipt of such money or property
is prima facie evidence of knowledge of the insolvency at the time of
such receipt. Loans to any one individual or corporation are limited


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Federal Reserve Bank of St. Louis

2147

to 15 per cent of the paid in stock and surplus of the bank. Loans
secured on real estate limited to 25 per cent of total interest bearing
securities and to a period of three years, but further loans allowed
secured by first mortgage on real estate worth double amount of loan
limited to 50 per cent of saving deposits and to a period of five years.
No bank may engage in trade or commerce; or acquire realty, except
such as is necessary for its business or such as is necessarily acquired
in the protection or satisfaction of previously existing loans made in
good faith. Any realty so acquired must be sold in ten years, or
sooner if possible. No director may borrow money in excess of 10 per
cent of the capital and surplus, without the consent of a majority of
the directors other than the borrower. No bank shall loan to any
officer or employe thereof. All banks except National Banks, are
under the supervision of the State Bank Commissioner who examines
each institution at least twice yearly. If he finds capital impaired,
he requires the bank to make up deficiency, or takes possession
for purposes of liquidation, as circumstances may require. Insolvent
banks may be placed in control of the State Bank Commissioner.
No receiver can be appointed, nor can a bank make an assignment
for creditors. Every bank makes reports of its condition to the
commissioner three times yearly.
Banks, Miscellaneous. Savings Banks, Trust Companies, either
independent or as a part of a bank. Industrial Banks and Credit
Unions are all authorized and are regulated by the State Bank Com­
missioner.
Bills of Exchange. (See Commercial Paper.)
Bills of Lading and Promissory Notes. (See Commercial Paper.)
Blue Sky Law. All corporations organized in Colorado who desire
to place on sale to the public, securities in certain classes must comply
with the “Securities Act” or “Blue Sky Law” of 1923 as amended
in 1931, which provides that two copies of prospectus issued shall be
filed with the Secretary of State setting forth certain information
with reference to the company and the Secretary of State shall charge
and collect a fee of $10 for the filing of such prospectus. Securities
salesmen must further register under the Act of 1931 with the Secre­
tary of State. The Act of 1931 may not be in effect; the question
of its reference under the initiative and referendum is pending in the
Supreme Court as this volume goes to press.
Building <fc Loan Associations are authorized and are regulated
by a Building and Loan department.
Chattel Mortgages as between the parties are good until the
indebtedness is paid or barred by limitation. To be valid as to third
persons they must state the amount and maturity of the debt, describe
the property, and be acknowledged and filed or recorded. The form
of acknowledgment is "This mortgage was acknowledged before me
this................ day of............................ 19...., by............................................
mortgagor”; if by a corporation or partnership, the form is varied to
read ‘ ‘ by............................................for........................................... mortgagor. ’ ’
The notary must state when his commission expires. The lien
remains good until the maturity of the indebtedness but not to exceed
two years if for not over $2,500, for five years if for from $2,500 to
$20,000, and for ten years if for over $20,000, but as to mortgages for
over $2,500 a sworn statement must be filed annually beginning with
the third anniversary showing good faith and the amount unpaid.
Possession may be taken at any time within six months after the
maturity named, or to which it may have been extended, and the
mortgage may be extended or further extended by filing or recording
a sworn statement showing total payments, amount unpaid, that the
debt is due, and that it is extended to a definite stated time, not exceed­
ing two years. During said six-month period the debt may be paid
and the lien discharged as at maturity. Mortgages of stocks of
goods which reserve possession and power of sale to mortgagor, are
void as against creditors and bona fide purchasers. Disposing of
mortgaged property is larceny. Chattel mortgages upon household
goods used by the family, when made by husband or wife residing
with the other, must be made by husband and wife jointly.
Collaterals. Shares of stock may be validly pledged only by
delivery of the certificate properly indorsed. Persons holding stocks
in corporations as collateral security are not personally liable as stock­
holders for corporate debts. A pledgee of stock may represent same
at corporate meetings.
Commercial Paper is governed by the uniform Negotiable
Instruments Act adopted in 1897. To be negotiable, an instrument
must contain an unconditional order or promise to pay to order, or to
bearer, a certain sum of money or demand, on at a fixed or determinable
time or times. The instrument may authorize that upon default
of payment of any installment, or of interest, the whole shall become
due, and in case of non-payment, the sale of collateral securities,
or confession of judgment, or waive benefit of any law intended
for the advantage of the obligor. An instrument payable on con­
tingency is not negotiable. The date expressed is prima facie the
true date. One in possession of an incomplete instrument has prima
facie authority to fill in the blanks, but authority must be strictly
pursued. Consideration is prima facie presumed. A pre-existing
debt is a valuable consideration. An accommodation party is liable
to a holder for value with notice. Two or more payees, unless part­
ners, must all indorse unless one has authority for all. An instrument
payable to a person as cashier or other fiscal officer of a bank or corpo­
ration is deemed prima facie payable to the bank or corporation, and
may be indorsed by the corporation or by the officer. For one to
be a holder in due course the instrument must be complete and regular,
and taken in good faith for value before overdue, and without notice
of any infirmity in the instrument or defect in title. Holder is deemed
prima facie holder in due course; but when the title of a person who
has negotiated it is shown to be defective, the burden is upon the
holder to prove himself a holder in due course. A qualified indorser
warrants the genuineness of the instrument; that he has a good title,
and that he has no knowledge of any invalidity. An unqualified
Indorser warrants the instrument valid and subsisting. One indorsing
an instrument negotiable by delivery is liable as indorser. Except
when excused, presentment for payment- or acceptance, on the day
when due is necessary to charge drawer or indorser of an instrument.
Presentment must be made on due day, and notice of non-acceptance
of non-payment given on next business day to all parties primarily
liable unless one has authority for all. Every negotiable instrument
is payable at the time fixed without grace. Waiver of protest is
deemed a waiver of formal protest, presentment, and notice of dis­
honor. Protest is required only in case of dishonored bills appear­
ing on their face to be foreign. It is optional in case of other nego­
tiable instruments. Bills drawn and payable within this State are
Inland; others are foreign. Parties secondarily liable are discharged
by extension of time of payment. Payment by a party secondarily
liable, unless an accommodation party, does not discharge the instru­
ment, but he may again negotiate it. A qualified acceptance dis­
charges drawer and indorser unless they assent. Assent is presumed
after notice, unless they dissent. Holder can refuse to receive a
qualified acceptance. No presentment for payment is necessary
after non-acceptance. A note drawn to maker’s order is not com­
plete unless indorsed by him. A check must be presented within
a reasonable time or drawer will be discharged to the extent of the
loss caused by the delay. The bank is not liable to the holder until
It accepts or certifies the check. When not otherwise provided by
this act. the law merchant prevails. This act applies only to instru­
ments executed on or after July 20, 1897. All instruments falling
due on Sunday or holiday are payable the next business day. In
cities of over 25,000, during June, July and August, Saturday from
twelve o’clock noon until twelve midnight is a holiday, but negotiable
instruments falling due on Saturday are payable and protestable on
Saturday of next business day at the option of the holder. The pro­
visions concerning commercial paper in this state are practically the
same as in all states where the Negotiable Instruments Act has been
adopted.

2148

BANKING AND COMMERCIAL LAWS—COLORADO

Conditional Sales. Conditional sales contracts give the seller
no rights as against purchases for value without notice from a buyer
in possession, and should never be used in this state, a chattel mort­
gage being the only satisfactory form of security.
Conveyances. No joint tenancy in real property unless expressly
declared in the deed, except in certain particular cases. Unless
so declared grantees shall be deemed tenants in common. Lands
not in possession may be conveyed. Not necessary for wife to join
in deed except in a conveyance of or a mortgage of a homestead,
entered as such of record. Witnesses are unnecessary. Seals are
not necessary but a printed or ink seal is advisable. Unacknowl­
edged deeds are deemed notice from the date of Sling but they can
not be read in evidence unless subsequently acknowledged or proved,
unless they are on record for over thirty years. (See Acknowledg­
ments: Husband and Wife.)
Corporations. Colorado corporation laws are broad and flexible
Three or more residents or non-residents may form a Colorado corp­
oration by signing, acknowledging and filing with the Secretary of
State a certificate stating the name (containing “Association,” “Com­
pany,” “Corporation,” “Club," “Incorporated,” "Limited,” “So­
ciety,” "Union,” “Syndicate," “Co.,” “Inc.,” or “Ltd.”), objects,
term of existence, which may be perpetual, the amount of stock which
may have any or no par value and may be divided into classes with
respect to voting power, preferences, participation, etc., the number
of directors, who may be classified according to term of office, location
of principal office, and whether cumulative voting is allowed, and,
if desired, special provisions limiting or regulating powers of the
company, directors, stockholders or any class thereof, providing for
compromises between the corporation and its creditors or stock­
holders, giving the board of directors power to sell or mortgage, giving
to stockholders a preemptive right to subscribe to additional stock
issues, requiring more than the legal proportion of voting for cor­
poration action, or permitting the directors to meet out of the state
or to make by-laws. Filing fees are $20 plus 20c per thousand capital
in excess of $50,000 capital or shares of no par stock, plus $5.00 for
certificate. Stock may be issued full paid and non-assessible for prop­
erty or services. Stockholders are liable for the amount remaining
unpaid on stock. When fully paid a certificate thereof should be filed.
Stock is transferred only by delivery of the certificate, unless the by­
laws otherwise provide for. Unless the certificate of incorporation
otherwise provides, mining and manufacturing companies can encum­
ber their property only by authority of a majority of stockholders.
The certificate may be amended in any respect excepting to change its
original purpose. The term of existence may be extended from time
to time and the corporation may be dissolved by a vote of two-thirds
of the stockholders. Foreign corporations are prohibited under
penalty from transacting business until they file a copy of their charter
of incorporation and a certificate identifying the act under which it
is organized and a certificate appointing an individual or corporate
agent for the service of process and pay a fee of $30 plus 30c on each
thousand dollars in excess of $50,000 represented by capital in Colo­
rado, plus $5.00 for a certificate of authority and $5.00 for designating
agent. Foreign corporations cannot mortgage property as against
citizens without published notice. Every corporation foreign or
domestic must on or before March 15th. or the next business day,
file an annual report as to its officers, stock and condition, on forms
furnished by the Secretary of State, paying a fee of $5.00, unless the
capital is $10,000 or less when the fee is $1.00, and for wilful con­
cealment of any material fact or failure to file such report the directors
and officers become liable for the debts contracted in the preceding
calendar year up to $1,000 each. An annual license tax of $10.00
plus 10c per thousand dollars capital or shares of no par stock above
$100,000 must be paid by all foreign or domestic corporations on or
before May 1st, failure to pay resulting in forfeiture or right to do
business subject to reinstatement within two years.
Special statutory provisions in addition to those governing general
business corporations apply to title and guaranty, banking, insurance,
mining, telegraph, ditch and reservoir, flume and pipe line, water
users, toll road, bridge and ferry, gas, cemetery, cooperative, religious
and for non-profit and other corporations.
Other provisions of the Revenue bill, approved August 4, 1917,
and this act regarding annual reports, assessment of tangible and
intangible property, etc., too voluminous to be quoted, make it
advisable that care should be exercised by both domestic and for­
eign corporations operating in the State to acquaint themselves fully
with its requirements.
Courts. Justices of the peace have jurisdiction over small wage
claims and in matters involving less than $300; county courts in mat­
ters involving less than $2,000, except in the administration of estates,
where jurisdiction is unlimited. The district court is the court of gen­
eral unlimited jurisdiction. The supreme court is the court of final
appeal, and also has some original jurisdiction, as in cases of habeas
corpus, mandamus and other remedial writs.
Days of Grace. Are abolished. (See Commercial Paper.)
Depositions. The deposition of a witness out of the State shall
be taken upon commission issued by the clerk of the court where
the suit is pending on the application of either party on five days'
previous notice to the other, which notice shall be accompanied
by a copy of the Interrogatories to be attached to the commission.
It may be issued to a person agreed upon by the parties or to any
judge or justice of the peace, or to a commissioner appointed by the
governor of the State to take affidavits and depositions in other States
and Territories, or to a notary public. The adverse party may file
and have attached to the commission such cross-interrogatories as
he may desire. Parties may agree by written stipulation to take
the deposition orally, or. upon proper cause shown, may obtain an
order of court directing it to be so taken. Depositions can be taken
at any time after starting suit.
Descents and Distributions. The estate of an intestate descends
one-half to the surviving husband or wife, and the residue to the
surviving children and descendants of children, if any; if none,
then the whole descends to such surviving husband or wife. Except
as enumerated the estate of every intestate descends: 1. To his
children surviving, and the descendants of his children who are dead,
the descendants collectively taking the share which their parents
would have taken if living. 2. If no children nor their descendants,
then to his father and mother, share and share alike, and if one dead,
then to the other; if no father or mother, then to his brothers and
sisters, and to descendants of borthers and sisters who are dead,
the descendants collectively, taking the share of their immediate
ancestors in equal parts. 3. If none of the foregoing living, then to
the grandfather, grandmother, uncles, aunts and their descendants,
the descendants taking collectively the share of their immediate
ancestors in equal parts. 4. If none of the relatives above enu­
merated be living, then to the nearest lineal ancestor and their descend­
ants, the descendants collectively taking the share of their immediate
ancestors in equal parts. All posthumous children or descendants
of the intestate, inherit as if born in the lifetime of the intestate,
and all children of the half blood and all legally adopted children
shall inherit as children of the whole blood. Illegitimate children
inherit if parents subsequently intermarry. Convicted Murderers
shall not inherit property of victim.
Dower. Common Law Dower and curtesy are abolished, as such,
but neither husband nor wife can by will devise more than one-half
of her estate away from the other without his consent.
Executions. Executions may be issued where no appeal is taken,
and when placed in the hands of an officer become a lien upon all
personal property of the debtor not exempt, in the county to which
It is issued, and it may be directed to the sheriil of any county in
the State. Executions may issue upon judgments at any time after
five days from judgment and within twenty years from the date of
entry but from and after twenty years from the entry of judgment, it is
considered satisfied unless revived as provided by law. Debtor or


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legal representative has six months to redeem land from sale under
execution. Judgment creditors or subsequent encumbrances may
redeem within ten days thereafter if they file notice of intention to
redeem before the expiration of said six months. Judgments can be
made a six-year lien on real estate of debtor by filing transcript with
recorder of the county where the real estate is situated.
Exemptions. Homestead, consisting of town house and lot or
lots, or of any farm to the value of not to exceed $2,000, is exempt,
when such homestead has been entered of record as such, and is
occupied by a householder, the head of a family. Personal property
exempt includes all wearing apparel of the debtor and his family
pictures, school books and library, beds and bedding, stoves, cook­
ing utensils, and household furniture, not exceeding $100; provisions
and fuel for six months; tools, implements, or stock in trade, up to
$200: one cow and calf, ten sheep and necessary food for six months:
working animals and farm implements up to $200; the library and
implements of a professional man up to $300; one bicycle and one
sewing machine. Persons not the heads of families are entitled to
tools, working animals, and stock in trade, not exceeding $300 in value.
When debtor is head of family, or wife of head of family, 60 per cent
of wages due at time of levy, under execution, attachment, or gar­
nishment, is exempt, when such family resides in the State and is
dependent, wholly or partially upon such earnings for support. If
such wages do not exceed $5.00 per week at the time of levy, they are
entirely exempt.
Fraud. Parties to any fraudulent sale of any lands, goods or
chattels, or who conceal, secrete, remove or dispose of any goods
or chattels, or are parties to any bond, suit, judgment, or execution,
contract or conveyance had made, or contrived with intent to deceive
and defraud, or defeat, hinder, or delay creditors; are criminally
liable. One who purchases goods on credit under an assumed or
fictitious name with intent to defraud the seller; or having purchased
goods on credit shall, with intent to deiraud the seller, sell, hypotnecate, or otherwise dispose of them out of the usual course of business,
or secrete himself, or abscond, shall be guilty of a misdemeanor.
Frauds, Statute of. The following must be in writing: Con­
tracts for leasing of land for period longer than one year or for the
sale of lands, or any interest in lands; every agreement which by
Its terms is not to be performed within one year: every special
promise to answer for the debt, default or miscarriage of another;
every agreement, promise, or undertaking made upon consideration
of marriage, except mutual promises to marry, and every contract
for the sale of any goods, chattels, or things in action, for the price
of $50 or more, unless the buyer accepts and receives part of such
goods or the evidence of some of them, or the buyer at the time
pays part of the purchase money.
Garnishment. (See Attachments.)
Holidays. January 1, February 12, February 22, May 30, July 4,
August 1, first Monday in September, Election Day in November
(Tuesday succeeding first Monday in even years), November 11,
Thanksgiving Day, December 25, or if any such holiday falls on
Sunday, the Monday following or the preceding Saturday in the case
of November 11th are legal holidays for all purposes including present­
ment of commercial paper. Third Friday in April, second Friday in
May, and October 12th are holidays not affecting business transac­
tions. Saturday afternoon in cities of 25,000 and over in June, July
and August, on which days commercial paper may be presented In
the forenoon or the following Monday.
Husband and Wife retain their separate property, real, personal
and mixed owned at marriage, and any such property which shall
come to either of them by descent, devise, or bequest, or the gift
of any person, for their own separate use. Such property of the
wife is not liable for the husband s debts. Wife may carry on trade
or business, sue and be sued, contract debts, and execute promissory
notes, bonds, bills of exchange, and other instruments precisely as
if sole and may convey real estate without the husband joining in
the deed. Any chattel mortgage upon, or sale of, the household
goods used by the family, and any conveyance of, or mortgage upon,
a homestead, and any assignment of future wages, or sums to become
due in the future, when made by husband or wife residing with the
other, must be joined in by that other, A married woman may
make a will, but neither husband nor wife shall devise or bequeath
more than half of his or her property away from the other without
the consent in writing of the other, executed after death of the testator
or of testatrix. Marriage revokes a will previously made. The
husband is liable for the debts and liabilities of the wife contracted
before marriage to the extent of the real and personal property he
may receive with or through her, or derive from the sale or rent of
her lands, and no further. The expenses of the family and the edu­
cation of the children are chargeable upon the property of both
husband and wife, and in relation thereto they may be sued jointly
or severally. Either husband or wife living together can separately
declare property of record in the name of the other “A Homestead,
by an entry of record over his or her signature. Neither can mortgage
nor convey homestead without the signature of the other.
Interest. The legal rate is 8 per cent, but any other rate may be
fixed by agreement with the exception of loans of $300 or less upon
which the maximum rate is 12 per cent. Eight per cent is allowed
on overdue bonds, bills, promissory notes, and judgments. County
town, and city warrants and other like evidences or certificates of
municipal indebtedness bear 6 per cent interest from presentation.
Judgments. A transcript of judgment may be filed in the office
of the county clerk and recorder of any county in the State, and
thereupon such judgment becomes a lien upon all real property
owned by the judgment debtor in that county. The lien holds for
six years from the date upon which filed, and successive transcripts
may be filed. As unsatisfied judgment should be revived every
twenty years. (See Executions.)
Limitations. Personal Actions. All actions upon any con­
tract or liability express or implied must be begun within six years
next after the cause of action accrues. In actions on account the
last item proved fixes the date. Bill of relief in the case of equitable
trusts shall be filed within five years; personal actions on any contract
other than the above and bills for relief on the ground of fraud shall
be filed within three years. The doctrine of laches applies in equitable
proceedings. Additional statutes govern limitations in certain unusual
proceedings. The limitation does not apply to minors, married
women or persons insane, in prison or absent from the United States,
who have one year from the removal of disability to sue. Payment,
new promise or absence from the state extend the period.
Real Actions. Actions to recover real property must be brought
within not more than 18 years after the right accrued as defined by
extensive statutory provisions. If the claim be against an actual
resident holding under fee or tax title, or against a person in possession
of land under claim or color title or having color of title to vacant
land, and having paid taxes for seven years, the action must be
brought within seven years after the right accrued. The lien of a
mortgage extends for only seven years beyond the date named for
final payment.
Married Women. (See Husband and Wife.)
Mechanics’ Liens. Mechanics, material-men, contractors, sub­
contractors, builders, miners, and all persons of every class performing
labor upon, or furnishing materials used in the construction or repair
of any building, or any other structure or improvement upon land,
also all who have rendered their professional, skilled service upon
such structure, have a lien upon the property, also those who work or
furnish materials or machinery for the working of a mining claim
or mineral deposit shall have a similar lien. Liens rank in the follow­
ing order: I. Laborers or mechanics working by the day or piece,
without furnishing material. 2. Sub-contractors and material-men.
whose claims are either entirely or principally for materials, machinery
or other fixtures. 3. All principal contractors. Laborers are allowed

BANKING AND COMMERCIAL LAWS—CONNECTICUT
one month, material men two months, and the original contractor
three months after the completion of the structure, within which to
file claim of lien. Action to enforce such lien must be commenced
within six months after completion of the building upon which it is
claimed.
Mortgages. Ordinary mortgages on realty are in common use;
also deeds of trust to a public trustee and to private trustees. A
trust deed to private trustee is foreclosed as to a mortgage. In case
the public trustee is named, the property is sold by him as provided
in the deed, after advertisement in a newspaper designated in the
trust deed, and such advertisement shall not be less than four weeks.
Upon a sale by the public trustee, a certificate of sale is issued. Re­
demption may be made by the grantor within six months. Within
10 days thereafter, if notice of intention to redeem has been filed within
six months, subsequent encumbrancers or lienors may redeem in order
of priority.
Notes and Bills of Exchange. (See Commercial Paper.)
Partnerships. General partnerships are governed by the rules
of the common law ordinarily applicable, without statutory change,
excepting that individuals or partners doing business under any
name other than their personal names must file an affidavit showing
the real persons represented, or may not bring suits upon debts due,
and may be convicted or fined. Limited partnerships are organized
under the uniform limited partnership act adopted in 1931. A
limited partnership is formed by signing a certificate in statutory form.
A limited partner is not liable to creditors beyond the amounts stated
in such certificate unless he takes control of the business. The rights
of the partners, rights of third persons, method of conducting the
partnership, its dissolution, etc., are minutely provided for.
Powers of Attorney. Powers of attorney for the conveyance
of lands must be acknowledged in the same manner as deeds, and
must be recorded in the same county wherein the real property to
be conveyed is situate.
Protest. (See Commercial Paper.)
Replevin. A writ of replevin may issue in any suit to recover
possession of personal property upon filing a bond in double the
value of the property, with affidavit of ownership or right to pos­
session, wrongful detention and value of property, etc. Redelivery
bond in similar amount may be given by defendant in forty-eight
hours after levy.
Sales of Personal Property. Every sale or assignment of goods
and chattels in the possession or under the control of the vendor
Is void, as against creditors or subsequent purchasers in good faith,
unless accompanied by immediate delivery and followed by actual
and continued change of possession. Sales of any portion of a stock
of merchandise otherwise than in the ordinary course of trade are
prlma facie fradulent and void against creditors, unless seller and
purchaser together, before sale, make inventory, showing quantity
and cost price of the various articles; and unless purchaser makes
full inquiry of the seller as to names and addresses of all creditors
of seller, and the amount due to each, and obtains an answer; and
notifies each creditor of the proposed sale, the cost price, and the
proposed selling price; and unless the purchaser retains the inventory
and written answer at least six months after the sale. This act
does not apply to sales by legal representatives of public officers
conducting sales in their official capacity and there are some other
exceptions to this law. (See Husband and Wife.)
Securities Act. See Blue Sky Law. '
Suits. (See Actions.)
Taxes. A schedule of taxable property in each county with the
owner's valuations must be filed between April 1 and May 20. Taxes
are assessed after a review of valuations in August. Taxes levied
are a lien on real estate until paid, as also upon stocks of goods includ­
ing new goods added thereto. Taxes may be paid in two semi-annual
installments; the first on or before the last day of February, and the
residue on or before the last day of July of the year following the one
in which they are assessed. Tax sales are held in November when
tax certificates are given to purchasers on which treasurer’s deed
may issue after three years. Prior to sale delinquent taxes bear
interest at 15 per cent per annum; after sale at 18 per cent per annum
for the first six months, 12 per cent thereafter. Household goods
to the value of $200 belonging to a head of a family are exempt from
taxation.
Unclaimed Dormant Bank Deposits. A list of all deposits with
names and last known addresses of depositors which have remained
unchanged except for credits for interests for ten years or more or
which have for ten years remained unclaimed shall be published in
one issue of a newspaper of general circulation in the city where the
deposit is located, sworn to by the cashier at any convenient day
during March in each year.
Wills. Males of the age of twenty-one years, and females of
the age of twenty-one years, may dispose of their real and personal
property by will but personal property may be disposed of by will
by any person of the age of seventeen years. For restrictions as to
married persons, see “Husband and Wife." All wills, whether of
realty or personalty shall be in writing signed by the testator or
some one for him in his presence and at his direction, and attested
in his presence and in the presence of each other by two or more
credible witnesses. Unless otherwise expressed in the will an afterborn child will share in the property. Devises and bequests to wit­
nesses are null and void, unless the will be attested by a sufficient
number of witnesses exclusive of such persons. No will can be revoked
otherwise than by the subsequent marriage of the testator, or by
burning, tearing, or obliterating the same by the testator, or in his
presence and by his direction and consent, or by another will or credit,
declaring the same, duly signed and witnessed. The property devised
by will must be administered by the county court, and all property
of non-residents must generally be administered to clear title to real
property situated in this State. (See Husband and Wife. Descents
and Distributions. Administration of Estates.)

SYNOPSIS OF

THE LAWS OF CONNECTICUT
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Field, Durant & Thim, Attorneys at Law, 129
Church St., New Haven. (See Card in Attorneys List)
Accounts. In all actions for a book debt, the entries of the
parties in their respective books shall be admissible in evidence.
(For limitation of actions on accounts, see Limitations to Suits.)
Acknowledgments. (See Conveyances.)


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2149

Actions. There is but one form of civil action. Mesne process
In civil actions consists of a writ of summons or attachment, describ­
ing the parties, the court to which it is returnable, and the time and
place of appearance, and embodies the plaintiff's complaint. All such
writs shall be signed by a justice of the peace, commissioner of the
superior court, or judge or clerk of the court to which it is returnable.
The complaint should contain a concise statement of the facts con­
stituting the cause of action and a demand for relief, and legal and
equitable relief may be demanded in the same action, except in actions
before justices of the peace, who have no equity jurisdiction.
Administration of Estates. The probate court has jurisdic­
tion of deceased estates. Administration on intestate estates is
granted to the husband or wife, or next of kin or to both. On their
refusal or incapacity, or upon objection by any creditor or heir to
such appointment found reasonable by the court, then to any other
person whom the court deems proper. Bonds, which must be fur­
nished by the administrators or executors, are usually made double
the estimated value of the personal property. Bonds of surety com­
panies authorized to do business in the State may be accepted. Where
the will waives the bond a nominal bond is required, usually in double
the amount of the debts of the testator. Deceased estates may be
settled as solvent or insolvent. Not less than six months are limited
for the presentation of claims against deceased estates, whether
solvent or insolvent. Such claims are presented to the adminis­
trator or executor if the estate is solvent, or to commissioners
appointed by the probate court if the estate is insolvent. Creditors
not inhabitants of this State may exhibit their claims against any
estate which has not been represented insolvent, at any time within
one year after order of notice, and if presented more than six months
after order of notice, shall be entitled to payment only out of the clear
estate remaining after payment of claims exhibited within time
limited. Suit must be brought within four months from the time
of receiving written notice from the administrator or executor of a
solvent estate of the disallowance of a claim. Twelve months Is the
usual time allowed for the settlement of deceased estates. Admin­
istrators and executors may mortgage real estate if shown to be for
benefit of the estate, after due application to and hearing in probate
court.
Affidavits. Civil actions do not ordinarily have to be supported
by affidavits. Affidavits have no weight as evidence, and are never
admitted as such.
Aliens. Any alien resident of any of the United States, and
any citizen of France, so long as France shall accord the same rignt
to citizens of the United States, may purchase, hold, inherit, or
transfer real estate in this State in as full a manner as native-born
citizens.
Arbitration. Parties to any controversy desiring to submit the
same to arbitration under a rule of court, and having signed and
sworn to an agreement to that effect, may, upon filing this agree­
ment in the court having jurisdiction of the subject matter, have
this agreement entered of record and obtain a rule of court that
the said parties shall submit to and be finally concluded by such
arbitration; or the said parties may personally appear in court
and acknowledge that they have mutually decided to submit their
controversy to the arbitration of certain named persons and may
obtain a rule of court of similar purport; or in case of an action
pending in court, if the parties thereto desire to refer it to arbitra­
tion, each may choose one arbitrator and the court appoint a third;
and in either of these three cases, the award of the arbitrators being
returned and accepted by the court, judgment shall be rendered
pursuant thereto, and execution granted thereon, with costs.
Arrest. The body is exempt in ordinary actions for debts, except
for money received by one acting in a fiduciary capacity, or where
there is fraud in contracting the debt or in concealing attachable
property so that it may not be reached by civil process. In actions
generally, no attachment shall be granted against the body except
for fraud. A debtor committed to jail on civil process can be released
on taking poor debtors’ oath. The debtor will not be released if his
oath is overcome by rebutting evidence.
Assignments in Insolvency. Operation of this section sus­
pended during continuance of U. S. Bankruptcy Act.
Attachments. Attachment may be made upon the original
process, and is served by attaching the goods or lands of the defend­
ant, or. if sufficient goods be not found, the person in actions where
there is fraud in contracting the debt or concealing property or refus­
ing to pay an admitted debt. Attachments may be granted upon all
complaints containing a money demand. Supplemental attachment
may be ordered by the court upon application at any time during
the pendency of the action. If the plaintiff be a non-resident, he is
required to furnish a bond for prosecution from twenty dollars to one
hundred and forty dollars, according to amount attached. An attach­
ment lien expires unless execution is levied within sixty days after
final judgment upon the attached personal property, or within four
months upon the attached real estate. (See Exemptions.)
Banks. (See State Banks and Trust Cos.)
Bills of Exchange. (See Notes and Bills.)
Bills of Lading. Uniform Bills of Lading Act passed In 1911.
Chattel Mortgages. (See Mortgages, Conditional Sales, and
Interest.)
Collateral Inheritance or Succession Tax. (See Taxes.)
Conditional Sales. All contracts for the sale of personal property
conditioned that the title thereto shall remain in the vendor after
delivery, shall be in writing, describing the property and all conditions
of such sale, and shall be acknowledged before some competent
authority and filed within a reasonable time in the town clerk’s office
in the town where the vendee resides; but the provisions of this act
■hall not apply to household furniture, musical instruments, phono­
graphs, phonograph supplise, radios, bicycles or property exempt from
attachment and execution. If not made as required, they are held to
be absolute sales, except as between the vendor and vendee or their
personal representatives. A crime to conceal or convey personal
property held on such conditional sale.
Conditional Sales Concerning Building Equipment. Any
contract for the sale of a portable garage or other portable building
or electric light fixtures, or plumbing fixtures, or elevators, or building
materials, or any equipment used in any building and so placed as to
apparently form a part of such building, conditioned that the title
thereto shall remain in the vendor after delivery, shall be in writing
describing the property and all the conditions of the sale, and shall
be acknowledged before some competent authority, and filed within
a reasonable time in the office of the town clerk in the town where
the real estate upon which such articles are placed is situated.
The vendor's rights under such conditional sale contract shall not
be valid or enforcible against any bona fide purchaser or mortgagee
of the real estate upon which such property shall be placed unless and
until such contract, together with a statement of the name of the
record owner of such real estate,shall be filed in the land records of
the town in which such real estate is situated as provided for in sec­
tion one hereof; and any bona fide interest in such real estate ac­
quired for value after the date of such contract and recorded in said
land records before such conditional sale contract shall be filed as
provided in section one hereof shall be prior to and be protected against
the claims of the vendor under such conditional sale contract
Contracts. Ordinary provisions of Statute of Frauds apply.
Courts of probate having jurisdiction of the settlement of the estate
of any deceased person may, concurrently with the courts of equity
authorize the executor or administrator to convey the title of the
deceased in any real estate to any person entitled to it. by virtue
or any contract of such deceased person, and the court of probate
In which the guardian of any minor has been appointed may in
like manner, order such guardian to convey the interest of his ward
in any real estate which ought in equity to be conveyed to another
person. Contracts for the conveyance of lands or of any interest

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BANKING AND COMMERCIAL LAWS—CONNECTICUT

therein, may be recorded In the records of the town in which such
lands are; and such record shall be notice to all the world of the
equitable Interest thus created. Gaming or wagering contracts
are void. Contract of incapable person pending appointment of
conservator or applicant. Void when select men have filed in town
clerk’s office certified copy of application in case of incapable person,
and contract of spendthrift void when select men have filed in town
clerk’s office certified notice of proposed appointment in case of
spendthrift. No person who receives a valuable consideration for
a contract, express or Implied, made on Sunday, shall defend any
action upon such contract on the ground that it was so made until
he restores such consideration. The Uniform Sales Act passed in
1907 covers contracts to sell. (See Sales by Retail Dealers.)
Conveyances. All conveyances of land must be in writing,
signed, sealed, and acknowledged by the grantor, and attested by
two subscribing witnesses. The word “seal” or the letters (L. S.)
may be used for a seal. The acknowledgment is made by the grantor
before a judge of a court of record of this State or or the United
States, a clerk of the superior court, court of common pleas, or dis­
trict court, justice of the pease, commissioner of the school fund,
commissioner of the superior court, notary public, town clerk, or
assistant town clerk, if in this State, and if in any other State or
Territory of the United States, then beiore a commissioner appointed
by the governor of this State and residing therein, or any officer
authorized to take the acknowledgement of deeds in such State or
Territory, and if in a foreign country, before any consul of the United
States, or notary public, or justice of the peace in such foreign country.
Conveyances of real estate situated in this State, executed and
acknowledged in any other State or Territory, in conformity with the
laws of such State or Territory, are valid. If the land conveyed
belongs to the wife, the husband should join in the conveyance, if
married before April 20, 1877. If the land conveyed belongs to the
husband, the wife need not join in the conveyance. No separate
examination of a married woman is required in taking her acknowl­
edgment. Conveyances, including leases for more than one year, to
be effectual against any other person than the grantor and his heirs
must be recorded on the town records of the town in which the land
lies.
Corporations. Corporations may be formed under the general
laws by three or more persons for the transaction of any lawful busi­
ness except that of bank, savings bank, trust company, building
and loan association, insurance company, surety or indemnity
company, steam railroad or street railway company, telegraph com­
pany, and gas and electric lighting, water company, or any company
which shall need to have the right of eminent domain.
A certificate of incorporation must be filed, signed, and sworn to
by at least three of the ineorporators. giving the name and location
of the corporation, the nature of the business, the amount of authorized
capital stock, which must not be less than $2,000, number of shares
and par value of each, amount of capital stock with which it will
commence business, which shall not be less than $1,000. A certified
copy must be filed in the town clerk’s office.
The organization fee must be paid to the State, of one dollar, on
every thousand of its authorized capital stock up to five million, no
payment to be less than $50.
,
,
Stock may be paid for either in cash or property, but if in prop­
erty, a majority of the directors must make and sign upon a record
book a statement of the amount for which the property is received
and its actual value. In case of fraud in such valuation, directors
personally liable.
,
.
.
Certificate of organization must be signed and sworn to by a majority
of the directors and filed in the office of the secretary of state, setting
forth the amount of stock subscribed for amount paid in cash and
In property, amount paid on each share of stock which is not paid
for in full, names and address of subscribers with number of shares
subscribed for, statement that the directors are officers have been
duly elected and by-laws adopted, names and addresses of directors,
the location of the principal office in the State with the name of the
agent in charge.
, , ..
There must be at least three directors; vacancies in directors may
be filled by remaining directors.
.
No stock can be issued until it has been paid for In full. Receipts
for partial payments of stock may be issued by the treasurer. Cer­
tificates for fractional shares cannot be issued. The corporation
has a lien on capital stock owned by any person for debts due to
capital stock with the approval of stockholders owning three-fourths
of its entire outstanding capital stock, given at a meeting called for
that purpose.
Stockholders’ meetings must be held in this State.
Similar corporations may consolidate.
A corporation may be wound up by voluntary agreement of all
stockholders, signed and acknowledged, directors acting as trustees
to wind up the business.
Receiver may be appointed on application of stockholders own­
ing one-tenth of the stock, in case of fraud, mismanagement, or if
assets are in danger of waste by attachment, or when corporation
has abandoned its business.
....
„
...
.
Annual statements must be filed in the office of the secretary of
state and a certified copy thereof in the town clerk s office, either
on or before the 15th day of February or August, giving the names
and addresses of the officers and directors, amount of outstanding
stock not paid for in full with the amount due thereon, the location
of the principal office In this State with the name of the agent in charge
on whom process may be served. For failure to file annual statement
the corporation may forfeit $25 to the State.
Stock of no par value may be issued.
Costs. For case before justice of the peace, actual cash costs
not less than $5; before city court from $10 to $50, according to
amount involved; before court of common pleas or superior court,
not less than $25; before supreme court of errors, not less than $50.
Attorney’s fees not included. Attorney justified in asking deposit
of $15 for case in justice's court and $50 in any other court before
bringing suit. (See Insurance Companies. Injunctions, etc.)
Courts. Terms and Jurisdiction. Superior court holds one term
per year in each county for the trial of civil causes, and has juris­
diction in all law and equity cases exceeding $500, and exceeding
$100 in those counties where there are no courts of common pleas.
Court of common pleas In Hartford, Fairfield, New London, and
New Haven counties has exclusive law and equity jurisdiction above
$100 and below $500, and concurrent jurisdiction with the superior
court above $500 and up to $2,000, and in Litchfield County has
exclusive jurisdiction up to $1,000. Not less than four terms each
year are held in each of the counties named, and there are city courts
in many of the cities, ana a district court at Waterbury, with limited
civil jurisdiction, also town courts in many of the towns. Probate
courts have jurisdiction of the settlement of the estates of deceased.
Insolvent, ana incompetent persons, and are established in a large
number of probate districts—one for each district. Justices of the
peace have civil jurisdiction up to $100. In New Haven and Hart­
ford jurisdiction of j ustice 01 the peace has been transferrea to city
court, except in cases of summary process and bastardy.
Days of Grace. (See Notes and Bills of Exchange.)
Deeds. (See Conveyances.)
Depositions. May be taken in a civil action by a judge or clerk
of any court, justice of the peace, notary public, or commissioner
of the superior court, when witness lives out of the State, or more
than twenty miles from place of trial, is over sixty years of age and
unable to attena the trial, is going to sea, or out of the State,, or by
age and infirmity is unable to travel to court, or is confined in jail.
Reasonable notice must be given to adverse party. Deponents must
be cautionea to speak the whole truth, ana carefully examined.
They must subscribe their depositions and make oath before the
authority taking the same who shall attest the same and certify


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that the adverse party or his agent was present (if so), or that he
was notified, and shall also certify the reason of taking such depo­
sition, seal it up, direct it to the court where it is to be used, and
deliever it, if desired, to the party at whose request it was taken.
Depositions may be taken in any other State or country by a notary
public, commissioner appointed by the governor of this State, or by
any magistrate having power to administer oaths, and they may
also be taken before a foreign minister, secretary of legation, consul,
or vice-consul appointed by the United States, if taken out of the
United States. A judge of the superior, common pjeas, or district
court can issue a “commission” to take the deposition of a person
residing out of this State, to be used in a cause pending before such
court. The superior court, upon petition, may allow depositions to
be taken to perpetuate testimony concerning that which may there­
after be the subject of a suit. The person taking depositions may
compel attendance of witnesses by subpoena and capias.
Descent and Distribution of Property In Intestate Estates.
(As to the share of a surviving husband or wife, see the title Husband
and Wife.) After the share of the surviving husband or wife, the
residue of the real or personal estate is distributed in equal propor­
tions among the children and the legal representatives of any of
them who may be dead (children who have received estate by advance­
ment of the intestate in his lifetime being charged with the same in
the distribution). If there be no children or legal representatives
thereof, such residue shall be distributed to the parent or parents,
then equally to the brothers and sisters of the intestate of the whole
blood, and those who legally represent them; and if there be no
such kindred, then equally to the brothers and sisters of the half
blood and those who legally represent them; and if none, then equally
to the next of kin in equal degree, kindred of the whole blood to
take In preference to kindred of the half blood, in equal degree, and
no representatives to be admitted among collaterals after the repre­
sentatives of brothers and sisters.
Dower. (See Husband and Wife.)
Evidence. (See Courts, Insurance Company, Corporations.)
Executions. Issue on final judgment, and are returnable within
sixty days. No execution issued in an action founded on contract
merely can be levied on the body of the debtor except for breach
of promise of marriage, misconduct or neglect in office or profes­
sional employment, or breach of trust and cases where the original
attachment is against the body. Any Judgment debtor, an execution
against whom shall have been returned unsatiflsed in whole or in
part, may be examined on oath touching his property and means of
paying such judgment, and may be committed for contempt. (See
Exemptions.)
Exemptions. Homestead, to the value of $1,000, if declaration
to hold it as such is recorded. Of the property of any one person,
his necessary apparel and bedding and household furniture necessary
for supporting life; any pension moneys received from the United
States while in the hands of the pensioner (which has been construed
to cover also such pension money when deposited in a savings bank);
Implements of the debtor's trade, his library not exceeding $500
in value; sundry domestic animals not exceeding $150 in value:
so much of any debt which has accrued by reason of the personal
services of the debtor as shall not exceed $15, including wages due for
the personal services of any minor child (but there shall be no exemp­
tion of any debt accrued by reason of the personal services of the
defendant against the claim for the defendant’s personal board, or
for the rental of any house or tenement occupied by the defendant
as a place of residence when such rental shall not exceed $25); of
the property of any one person having wife or family, two tons of
coal, specified amounts of food-stufls; the horse of any physician
or surgeon not exceeding $200 in value, and his saddle, bridle, har­
ness. and buggy, also his bicycle one boat owned by one person,
with rigging, tackle, etc., not exceeding $200 in value, used for plant­
ing or taking oysters or clams or taking shad; one sewing machine
being property of any one person using it, or having a family; one
pew being property of any person having family who ordinarily
occupy it, and lots in any burying ground; and all benefits allowed
by any association of persons in this State toward the support of its
members, incapacitated by sickness or infirmity, shall be exempted
from foreign attachment or execution.
Foreign Attachments. Goods concealed in the hands of agents
or debts due the defendant are reached by foreign attachment which
takes the place of garnishment. No assignment of future earnings
will prevent their attachment when earned unless made to secure
a bona fide debt, due at the date of such assignment, the amount
of which shall be stated therein as nearly as possible, nor unless
the term for which they are assigned shall be definitely limited in
the assignment, nor unless recorded before such attachment in the
town clerk’s office in the town where the assignor resides, or if he
resides without the State, in the town where the employer resides, and
a copy left with the employer. (See also Exemptions.)
Foreign Corporations. Every foreign corporation, except insur­
ance and surety companies and building and loan associations and
investment companies (a corporation which has power to or does
sell or negotiate its own choses in action or sell, guarantee, or negotiate
the choses in action of other persons or corporations as investments),
shall, before transacting business in this State, file in the office of
the secretary of the State a certified copy of its charter or certificate
of incorporation, together with a statement, signed and sworn to
by its president, treasurer, and a majority of its directors, show­
ing the amount of its authorized capital stock and the amount thereof
which has been paid in, and, if any part of such payment has been
made otherwise than in cash, such statement shall set forth the
particulars thereof. Sec. 83.—Every foreign corporation with an
office or place of business in this State, except insurance companies,
surety companies, and building and loan associations, shall, before
doing business in this State, appoint in writing the secterary of the
State and nis successors in office to be its attorney, upon whom
all process in any action or proceeding against it may be served;
and in such writing such corporation shall agree that any process
against it which is served on such secretary shall be of the same
legal force and validity as if served on the corporation, and that
such appointment shall continue in force as long as any liability
remains outstanding against the corporation in this State. Such
written appointment shall be acknowledged before some officer
authorized to take acknowledgments of deeds and shall be filed in
the office of said secretary, and copies certified by him shall be suffi­
cient evidence of such appointment and agreement. Service upon
said attorney shall be sufficient service upon the principal, and may
be made by leaving a duly attested copy of the process with the
secretary of the State or at his office. Everv foreign corporation
doing business in this State shall, within thirty days after an increase
or reduction of its capital stock file in the office of the secretary
of the State a certificate substantially like that required of domestic
corporations organized under the like conditions. The president and
treasurer of every foreign corporation doing business in this State
which is not requirea by law to make other annual returns in this
State, shall, annually, on or before the fifteenth day of February or
August, make, sign, and swear to and file in the office of the secretary
of the State a certificate similar to the certificate required of domes­
tic corporations (See Corporations), except that such certificate
need not give the name of the agent or person in charge of its principal
office upon whom process against the corporation may be served.
The secretary shall thereupon record such certificate in a book kept
by him for that purpose and shall furnish a certified copy to be recordea in the office or the town clerk of the town in this State in
which such corporation has its principal office or place of business
and said town clerk shall record the same in a book kept by him
for that purpose. On the thirtieth day of March and September
the town clerks of the several towns shall report to the secretary
of the State the names of all corporations whose annual reports have

BANKING AND COMMERCIAL LAWS—CONNECTICUT
been filled for record during the preceding six months, in accordance
with the provisions of this section, and the secretary shall report
to the attorney-general every six months the names of all corporations
which have failed to comply with the provisions of this section, and
the attorney-general shall collect all forfeitures due under this sec­
tion. Every corporation whose officers shall fail to comply with
the requirements of this section shall forfeit to the State $100 for
each failure. The attorney-general may remit this fine.
Foreign Judgments. Not conclusive on question of jurisdiction.
A foreign judgment when used by way of defence, is as conclusive
to every intent, as those of our own courts. In an action on a judg­
ment rendered in another State, evidence on the part of the defend­
ant that he had no legal notice of the suit and did not appear, is
admissible, although the record of the judgment stated that the
defendant appeared by his attorney. Where the foreign court
has a peculiar and exclusive jurisdiction, its decree is binding upon
the judgment of any other court, into which the same subject comes
Immediately into controversy. A judgment rendered by a court
in one State has no efficacy when it is sought to be enforced in Con­
necticut, unless such court had jurisdiction of the person against
whom it is rendered, acquired either by service upon him of the
process in the suit, or actual notice to him of the suit, or at least by
his having appeared in it, and thus submitting to the jurisdiction
of the court. Jurisdiction presumed to have been properly exercised,
if court once had jurisdiction. Notice presumed of resumption of
jurisdiction if required by practice of foreign court. A judgment
recovered in a sister State is a bar to the further prosecution of an
action pending at the time in this State between the same parties
on the same cause of action. It makes no difference that the judg­
ment of the sister State has been appealed from, and that the appeal
Is still pending, where by the laws of that State, such appeal operates
only as a proceeding in error, and does not supersede the judgment.
Only such pleas are pleadable to a foreign judgment, as are pleadable
when rendered.
Fraud. All fraudulent conveyances, suits, judgments, executions,
or contracts, made or contrived with intent to avoid any debt or
duty belonging to others, shall, notwithstanding any pretended con­
sideration therefor, be void against those persons only, their heirs,
executors, administrators, or assigns, to whom such debt or duty
belongs.
Garnishment. (See Foreign Attachments.)
Guaranty Companies. (See Surety Companies.)
Holidays. In each year the first day of January (known as New
Year’s Day), the 12th day of February (known as Lincoln Day), the
22d day of February (known as Washington's Birthday), the 30th day
of May (known as Memorial Day or Decoration Day), the 4th day of
July (known as Independence Day), the first Monday in September
(known as Labor Day), the 12th day of October (known as Columbus
Day), the 11th day of November (known as Armistice Day), and the
25th day of December (known as Christmas), or, whenever any of
such days shall occur upon Sunday, the Monday next following such
day, and any day appointed or recommended by the governor of this
state or the president of the United States as a day of thanksgiving,
fasting or religious observance, shall each be a legal holiday.
Husband and Wife. In all marriages contracted after April 19,
1877, neither husband nor wife acquires by force of the marriage
any right to or interest in any property held by the other before
the marriage or acquired after the marriage, except as to the share
of the survivor in the property of the other as hereinafter stated.
Wife married subsequent to April 19, 1877, may hold and convey
real estate separate from her husband. Separate earnings of the
wife are her sole property. On the death of the husband or wife
the survivor shall be entitled to the use for life of one-third in value
of all the property, real or personal, owned by the other at the time
of his or her decease, after the payment of all debts and charges
allowed against the estate. The right to such third can not be defeated
by will. Where there is no will the survivor shall take such third
absolutely, and If there are no children, shall take all of the estate
of the decedent absolutely to the extent of $2,000, and one-half
absolutely of the remainder of said estate, and if there are no children
of the decedent or representatives of children, and no parent, the
survivor shall take all of the estate absolutely.
Injunctions. Any judge of any court of equitable jurisdiction
may, on motion, grant and enforce writs of injunction, which shall
be of force until the sitting of such court and its further order therein,
unless sooner dissolved. Superior court judge may dissolve tem­
porary injunction granted by other court. All facts stated in appli­
cation for injunction must be verified by oath. Plaintiff must give
bond with satisfactory surety, to answer all damages in case of failure
to prosecute to effect, before temporary injunction can be issued,
unless the court shall be of opinion that temporary injunction ought
to issue without bond. Injunctions may be granted forthwith, if
the circumstances of the case demand it; or the court or judge may
cause immediate notice of the application to be given to the adverse
party, that he may show cause why such injunction should not be
granted; and it shall be sufficient, on such application for a tempo­
rary injunction, to present to the court or judge the original com­
plaint containing the demand for an injunction, duly verified, with­
out further complaint, application or motion in writing. Whenever
a temporary injunction is granted in any cause before the return
day thereof, it may be dissolved or modified by the court or judge
who issued it, by any judge of the court to which the action is return­
able, or by any judge of the superior court: provided a written
motion for such dissolution shall be prepared before the return day.
Any person who may be directly or indirectly interested in, or affected
by the granting of any temporary or permanent injunction, may
appear and be heard with regard to granting or dissolving the same,
when in any action a temporary injunction has been granted, and
upon final hearing judgment shall be rendered adverse to the contin­
uance of such injunction, either party may apply to the court rendering
such judgment, representing that he is desirous of taking the case
to the supreme court of errors, and praying that said temporary
injunction may be continued until the final decision therein; and
unless said court shall be of opinion that great irreparable Injury
will be done by the further continuance of said injunction, or that
said application is made for delay and not in good faith, it shall
be the duty of the court to continue said injunction until a final
decision be rendered in the supreme court of errors. When in any
action judgment shall be rendered for a permanent injunction order­
ing either party to perform any act, upon similar application to
that above mentioned, a stay of operation of such injunction, pending
final decision of supreme court of errors, may be granted for similar
reasons. The court in which such case is pending may. however,
if in its opinion the cause of justice shall so require, dissolve said
temporary injunction or remove the stay of said permanent Injunc­
tion while said cause is so pending in the supreme court of errors.
Insolvency. Suspended, owing to United States Bankruptcy Act.
Interest. Legal rate, in absence of express agreement, 6 per cent;
no more than 6 per cent can be recovered in either case after debt
becomes payable.
Express agreements in which 12 per cent is
charged are valid and any person making a greater charge is liable to
fine and imprisonment. There is no limit to the interest charge
which can be made by any National Bank or any Bank or Trust
Company, incorporated under the laws of this State nor is there any
limit to the interest charge on a bona fide mortgage of real property
exceeding the sum of five hundred dollars. Special law for pawn­
brokers. Loan companies licensed by Bank Commissioner may
charge not to exceed 42 per cent per annum on unpaid balances on all
loans up to $300.
Judgments carry 6 per cent interest, but are not liens, and execu­
tion may be had at any time during the life of both parties. Judg­
ment by default may be obtained if the defendant makes no appearance
on or before the second day of the session. Certificate of judgment
may be recorded by judgment creditor or his assignee in town clerk’s
office, and such judgment from the time of filing such certificate shall


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2151

constitute a lien upon the real estate described in such certificate, and
If such lien be placed upon real estate attached in the suit upon which
such judgment was predicated and within four months after such
judgment was rendered, it shall hold from the date of such attachment.
Such lien may be foreclosed or redeemed in the same manner as
mortgages upon the same estate, and may also be foreclosed by decree
of sale.
Jurisdiction. (See Courts.)
Liens. (Mechanics’ Liens.) Any person having a claim for
materials furnished or services rendered, exceeding the sum of $10.00,
In the construction, erection, and repair of any building, or in the
removal of a building, may have a lien on such building, and the
land on which the same may stand, and said premises may be fore­
closed, in the same manner as if held by mortgage. No one other
than the original contractor, or a sub-contractor under a written
contract, assented to in writing by owner, shall be entitled to claim
a lien unless, after starting and not later than 60 days after ceasing
to furnish labor or materials, he gives written notice to the owner
of his intention to claim and such lien. A certificate, subscribed and
sworn to, describing the premises, the amount claimed as a lien
thereon, and the date of the commencement of the claim, must be
lodged with the town clerk of the town in which such premises are
situated, within 60 days after the person performing such services or
furnishing such materials has ceased so to do. Mechanics’ liens may
be dissolved on substitution of bond. Such lien continues only 2 years
after it is perfected unless foreclosure is commenced. Vessels can be
subjected to a lien for moneys due for work or materials furnished in
their construction, by recording claim In town clerk’s office within
10 days after job is done. Persons keeping animals under contract
with owner have lien for their contract charge. Mechanics’ liens, on
claims for materials furnished or services rendered, under any contract
with or approved by a railroad corporation owning or managing the
railroad, are enforceable. The lien, however must be lodged with the
Secretary of State. By Public Acts 1925, there is no priority among
Mechanics' lienors, unless some other incumbrance intervenes, in
which case prior liens take precedence of incumbrance on pro rata
basis as between themselves. Liens after the incumbrance yield to
the incumbrance and as between themselves none has priority. The
Mechanics’ lien attach subject to apportionment only to the amount
which owner agreed to pay under the contract.
Limitations to Suits. Open accounts and contracts not under
seal, six years; contracts under seal and promissory notes not negoti­
able, seventeen years. Usual exceptions in favor of married women
minors, lunatics, and those imprisoned. The time during which
the party against whom there may be such cause of action shall be
without the State shall be excluded from the computation. Title
to real estate by adverse possession may be gained in fifteen years
There is no limitation against judgments but the common law pre­
sumption of payment after twenty years exists.
Limited Partnerships. Such partnerships (except banking and
Insurance) shall consist of one or more partners, jointly and severally
responsible, as in ordinary cases, to be called general partners; and
one or more partners, furnishing capital to the partnership stock,
whose liability shall not extend beyond the capital so furnished by
them, to be called special partners. Such partnerships shall be
conducted under a company name, in which the name of one or more
of the general partners shall appear; and if any special partner’s
name shall be used in said company name, he shall be held liable
as a general partner. No such partnership shall be deemed to be
formed until the persons forming it shall make, and severally sign
and acknowledge before any officer authorized to take the acknowl­
edgment of deeds, a certificate stating the company name and names
and residences of all the partners designating which are general
and which are special partners, and which of the general partners
are authorized to transact the partnership business and sign the
firm name, and also the amount of capital furnished by each special
partner and the time at which the partnership is to commence and
terminate; nor until such certificate, and also a certificate of the
amount actually paid in by each special partner, signed and sworn
to by such of the general partners as are authorized to transact the
partnership business, shall be filed and recorded in the office of the
town clerk of the town where the principal business of the part­
nership is to be carried on; and a copy of such certificate shall be
prima facie evidence of the matters therein contained; and the part­
nership shall be responsible only for the acts of the general partners
designated as specially authorized as aforesaid; and copies of said
certificates shall, in like manner, be filed in every town where such
partnership may have a place of business. Terms of such partnership
must be published for six weeks in newspaper published in county
where business is to be carried on. Any such partnership may be
renewed by filing at any time before its expiration, with the town
clerk, a sworn certificate of the general partners, setting forth the
time for which said renewal is made, whether the special capital
has been reduced or impaired since the last certificate filed by said
partnership, and if so, to what amount, and by publishing not less
than once a week for two weeks in a newspaper published in county,
the time at which the said renewed partnership is to commence and
terminate, signed by the partners thereto, and specifying which are
general and which are special partners. If the requirements con­
cerning original certificate are not complied with, or false certificate
be made, all special partners shall be liable as general partners. All
advancements to the capital stock by the special partners shall
be in cash and no part of the capital furnished by them shall be with­
drawn, either in the shape of dividends, profits or otherwise, at any
time while such partnership continues; except that any special part­
ner may lawfully be paid from the assets of such partnership, each
year during the continuance thereof, a sum not exceeding 10 per
centum upon the cash contributed by him to the capital stock; pro­
vided that such payment shall only be made out of the net profits
actually earned by such partnerships during the year for which such
payment is made. No special partner shall under any circum­
stances be considered a creditor, or allowed to claim as a creditor.
No special partner shall be joined as a party in any action by or
against such partnership unless liable as a general partner
Married Women. (See Husband and Wife.)
Mortgages of real estate are executed, acknowledged, and recorded
In the same manner as deeds, and are foreclosed by strict foreclosure
or by a decree of sale. Chattel mortgages to be good against third
parties, where the mortgagor retains possession, must be executed,
acknowledged, and recorded as mortgages of land, and can only be
made of the following described personal property—with or without
the real estate in which the same is situated or used—namely: ma­
chinery, engines, or implements situated and used in any manu­
facturing or mechanical establishment: machinery, engines, imple­
ments, cases, types, cuts, or plates situated and used in any print­
ing, publishing, or engraving establishment; household furniture in a
dwelling house used by the owner therein in housekeeping; hay and
tobacco in the leaf in any building. Piano, organ, melodeon, and
any musical instrument used by an orchestra or band. Brick burned
or unburned, in any kiln or brickyara. Hotel keepers may mort­
gage the furniture, fixtures, and other personal chattels contained
and used in the hotels occupied by them or employed in connection
therewith. Chattel mortgages are foreclosed by sale under order
of court. In all chattel mortgages there must be a particular descrip­
tion of each article of personal property. Judgment for deficiency
after sale, permitted.
Notaries Public hold office for five years from first day of Feb­
ruary of year in which commissioned, unless commission is sooner
revoked by governor. May exercise their function at any place in
State. May take acknowledgments, administer oath, take deposition,
subpoena witnesses to give deposition. The authority and official
acts of any notary may be certified to by the clerk of the superior
court of the county in which he resides, except in New London County,
where the certification is made by the clerk of the court of common
pleas.

2152

BANKING AND COMMERCIAL LAWS—DELAWARE

Notes and Bills of Exchange. Negotiable Instruments Act
now in force.
Powers of Attorney. Where a deed Is executed by a power of
attorney it is recorded with the deed. Powers of attorney to convey
real estate must be executed and acknowledged in the manner required
for the execution and acknowledgment of the conveyance itself.
Private Banks. (See end of State Banks and Trust Companies.)
Probate Law. (See Administration of Estates, Appeals, Assign­
ments and Insolvency, Collateral Inheritance Tax, Courts, Descent
and Distribution of Property, Husband and Wife, and Wills.)
Protest. (See Notes and Bills of Exchange.)
Records. Warranty, mortgage, quitclaim deeds must be recorded
In office of town clerk in town where land lies, also assignments of
mortgage, conditional bills of sale, chattel mortgages, assignments
of future earnings. Certificate of trade-mark to be filed for record
In office of secretary of State. Certificate of unsatisfied judgment
to be filed for record in town clerk’s office. (See Conveyances, Insur­
ance Companies, Limited Partnerships. Judgments, etc.)
Redemption. (See Mortgages.)
Replevy. Replevin lies for goods wrongfully detained, in which
the plaintiff has a general or special property with right to immediate
possession. A writ of replevin can not issue except upon an affidavit
In which the affiant states the true value of the goods to be replevied,
and that he believes that the plaintiff is entitled to the immediate
possession of the same, nor until the plaintiff furnishes a bond with
sufficient surety in a sum double the value of the property. This
bond or recognizance must be signed by the obligors in presence
of at least one witness other than the authority taking the recog­
nizance.
Sale of Retail Business. Any person (including a person having
an interest in a barber shop, dental parlor, restaurant, shoe shining,
or hat cleaning business), who makes it his business to buy commod­
ities and sell the same in small quantities for the purpose of making
a profit and desiring to sell the whole or a large part of his stock in
trade, must file a notice of such intention in the town clerk's office
not less than fourteen, nor more than thirty days prior to such sale.
Sales. Uniform Sales Act passed in 1907.
Service. Service of a writ of summons in case of a resident Is
made by reading it and the complaint accompanying it in the defend­
ant’s hearing, or by leaving an attested copy in the defendant’s hands
or at his usual place of abode; in case of a non-resident, the several
courts, other than courts of probate, and the judges, clerks, and
assistant clerks thereof, or any county commissioner, in term time
or in vacation, may, except where it is otherwise specially provided
by law, make such orders as may be deemed reasonable, in regard
to the notice which shall be given of the institution or pendency
of all complaints, writs of error and appeal from probate, which
may be brought to or pending in any court, when the adverse party,
or any person so interested therein, that they ought to be made
parties thereto, reside out of the State, or when the names or resi­
dences of any such persons in interest are unknown to the party
instituting the proceeding; and such notice having been given and
proved shall be deemed sufficient service and notice.
Statu Banks and Trust Companies. A reserve fund of 12 per
cent of its demand deposits and 5 per cent of its time deposits must
be held and maintained in the banking office, of which 4-12 must be
gold and silver coin, demand obligations of the United States or
national bank currency, or federal reserve notes and federal reserve
bank notes. The remainder of said reserve fund may consist of
balances subject to demand draft with reserve agents, which are
members of the clearing house associations of New York, Boston,
Philadelphia, Chicago, or Albany, or Buffalo, or a federal reserve
bank, or national banks, state banks, or trust companies, located in
Bridgeport. New Haven, or Hartford, or Waterbury. and of bonds
which are legal investments for savings banks whjch bonds shall at
no time exceed at par value one sixth of the total reserve fund. No
new loans or discounts may be made when the reserve is below 12
per cent. Bank commissioners may apply for appointment of a
receiver when the reserve falls below 12 per cent after thirty days’
notice. “Demand deposits” shall mean all deposits payable within
thirty days and “time deposits" shall mean all deposits payable after
thirty days.
No one person, corporation or firm may borrow more than 10
per cent of the amount of the capital stock paid in and surplus undi­
vided profits combined, of any state bank or trust company. This
does not apply to collateral loans. Penalty of $3,000 for violation
of this law. Paper of executive officers or clerks may not be dis­
counted. Loans to parties outside the State can only be made when
the loans and discounts in the aggregate amount in this state, to
one-half of the capital stock.
Books of a bank may be examined by stockholders under certain
conditions.
Three-fourths of the directors must be residents of the State. No
director may be obligated to a bank or trust company in an amount
exceeding 5 per cent of the capital actually paid in and surplus undi­
vided profits combined. This does not apply to loans secured by
collateral.
Cashier’s bond of $10,000.
At least three reports, verified by oath, must be made each year
to the bank commissioners, exhibiting in detail the resources and
liabilities of the bank or trust company ten days after receipt of
request therefor from the bank commissioners, which shall be published
In a newspaper in the county where the bank or the trust company
is located. Penalty of $10 for each day of delay in transmitting
report.
Words “bank,” “trust,” or "savings" may only be used by banks,
trust companies and building and loan associations incorporated by
the United States or by the general assembly, but this shall not apply
to firms or individuals doing business as private bankers or brokers
under their own names, who deposit with the State treasurer a bond
of $10,000, or acceptable securities of that amount for the protection
of customers from styling themselves bankers in the conduct of their
business. Banks and trust companies maintaining savings depart­
ments must invest deposits according to the laws of the State con­
cerning investments of savings banks, and must make sworn state­
ments to the bank commissioners on October 1st in each year and
oftener if required by the commissioners, of the amount of such
deposits and the securities in which they are invested. A State Bank
or Trust Company may be incorporated under General Laws as pro­
vided in Chapter 194, Public Acts of 1913.
Suits. (See Actions.)
Surety Companies. Any corporation with a paid-up capital of
not less than $250,000, incorporated and organized for the purpose of
transacting business as surety on obligations for persons or corpora­
tions, on complying with certain requirements of law may be accepted
as surety upon the bond of any person or corporation required by
the laws of this State to execute a bond. Every foreign corporation
before transacting any business in this State amust deposit with the
Insurance commissioner a copy or its charter or articles of association,
ana sworn statement of the condition or its business. The insurance
commissioner may thereafter issue to such company a license to do
business in this State. Such company must appoint the insurance
commissioner its agent on whom process may be served. Such com­
pany must file annually on or before March 1st, with the insurance
commissioner a statement of the capital of such company and its
investments and risks. An annual license is granted if annual state­
ment be satisfactory. Local agents must procure certificates of
authority to act as agent from the insurance commissioner. The
Insurance commissioner may also at any time examine the affairs
of any surety company doing business in the State. A reserve fund
must be maintained equal to 50 per cent of the gross amount of
premiums received on business in force. No such company can
incur on behalf of any one person or corporation a liability for an
amount larger than one-tenth of its paid-up capital stock and sur­
plus without giving collateral security.


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Taxes. Land may be sold for delinquent taxes after due adver­
tising, only so much being sold as is necessary to pay taxes and costs.
Owner has one year in which to redeem, by paying the purchase
money, with 12 per cent interest. Bonds, notes, or other choses
In action, except bonds and notes secured by mortgage on real estate
situated in this State, may be exempted from all local taxation by
paying to the State a tax of 2 per cent on the face amount thereof
for five years, or at the option of the holder thereof for a greater or
less number of years at a proportionate rate. Inheritance taxes are
levied on all property within Connecticut possessed by any resident
of Connecticut at the time of his decease, and all tangible property
within Connecticut possessed by a non-resident at the time of his
death which passed by gift, to take effect at death or by will to any
person, corporation, voluntary association or society, with exemp­
tions in favor of charities and on certain particular kinds of property.
Rates of the taxes are 1 per cent of the value of all property in excess
of $10,000 passing to any parent, grandparent, husband, wife, lineal
descendant, adopted child, adoptive parent ana lineal descendant of
any adopted child, up to $25,000 with graded increases; 2 per cent
on property passing to the husband or wife of any child of such decedant to any stepchild, brother or sister of the full or half blood and
to any descendant of such brother or sister in excess of $3,000 up
to and including $25,000, with graded increases; 5 per cent of the
value of all property in excess of $500 passing to any persons other
than those above mentioned up to and including $25,000 with graded
increases. Only one exemption is allowed for each class.
Transfer of Corporation Stocks. (See Corporations.)
Trust Companies. (See State Banks and Trust Companies.)
Warehouse Receipts. Uniform Warehouse Receipts Act passed
in 1907.
Wills. All persons of the age of eighteen years, and of sound
mind, may dispose of their estate (real or personal) by will. No
devise, except for public and charitable uses, or for the case of ceme­
teries or graves, shall be made to any persons but such as are at the
time of the death of the testator in being, or to their immediate issue
or descendants. Wills must be in writing, subscribed by the testator,
and attested by three witnesses, each of them subscribing in his pres­
ence, but they will be effectual here if executed according to the laws
of the State or country where executed. If after the making of a will,
the testator shall marry or a child shall be born to the testator or a
minor child shall be legally adopted by him, and no provision is made
in such will for such contingency, such marriage, birth or adoption
of a minor shild shall operate as a revocation of such will. No will
or codicil shall be revoked in any other manner except by burning,
canceling, tearing or obliterating it by the testator or by some person
in his presence by his direction or by a later will or codicil. A devise
of bequest to a subscribing witness or to the husband or wife of a sub­
scribing witness, is void unless the will is otherwise legally attested,
or unless the devisee or legatee be an heir to the testator. Wills are
proved and estates settled in the probate court in the district where
the deceased resided. Wills of nonresidents owning property in this
State may be proved by filing exemplified copies thereof in district
where property is located. Such course should always be taken in
order to pass good title to real estate.
Workmen's Compensation Act. Passed in 1913.

SYNOPSIS OF

THE LAWS OF DELAWARE
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Hugh. M. Morris, Attorney at Law, 3018 Du Pont Bldg.
Wilmington. (See Card in Attorneys’ List.)
Acknowledgments, in Delaware, may be made in the Superior
Court, before the Chancellor, or any judge or notary public or before
two justices of the peace for the same county, or before the judge
of the municipal court or the Mayor of Wilmington. Elsewhere
in the United States, before any Federal Judge or judge in any
court of record of any state or mayor or chief officer of any city or
borough, with official seal attached; or before the clerk or other officer
of said courts, or before any Commissioner of Deeds, or any notary
public. In foreign countries, before any consul or representative of
the United States, at his official residence, or any Commissioner of
Deeds.
In 1929, all deed records prior to January 1, 1929, were validated
by statute where signed and sealed by the grantor, although the
acknowledgment might be defective.
Actions. Actions at law and suits in equity are, in general, accord­
ing to the common law. A simplified procedure is followed in suits
on instruments in writing for the payment of money, book accounts,
judgments and mortgages, wherein the plaintiff files an affidavit of
demand; judgment is entered by default unless an affidavit of defense
is filed.
Affidavits, in Delaware, may be made before the Chancellor, any
judge, justices of the peace, or notary public. In legal proceedings
in Delaware, where an affidavit of a non-resident is required, it may
be made before any person authorized to take acknowledgments.
Aliens. Only such aliens as are entitled to citizenship, or otherwise
entitled under a treaty of the United States, may hold real or personal
property in the state; property which was acquired by others after
April 7, 1921, escheats to the state.
Attachments. All corporations doing business in the State are
liable to attachment, except banks. Insurance companies are only
so liable for moneys due on the happening of risks provided in the
policy.
Auctions. Auctioneers must be licensed, except veteran soldiers
or sailors who have had two years or more service. Fee is $10 for
residents and $100 for non-residents.
Bailments. Fraudulent conversion of bailed goods to the bailee’s
use is a misdemeanor. Otherwise, the common law rules apply.
Banks. All banks are under the supervision of the State Bank
Commissioner, and subject to examination by him annually or oftener.
Federal Reserve members may be exempted by him from examination.
He also has control of small loan companies. Banks may only be
created by special act of the Legislature, and no corporation created
under the general corporation law may be deemed to have banking
powers. Banking powers may be exercised only by a duly chartered
and authorized corporation. New banks must have a certificate from
the State Bank Commissioner that they are duly authorized to do
business. A certificate must also be had to open a branch office in
the state. Merger of banks is prohibited unless approved by the
Commissioner.
In case of impairment of capital, the Commissioner
must give a sixty-day warning, and if the deficiency is not corrected
in that time, he assumes control of the business or has a Receiver
appointed. Four reports a year of financial condition must be sent to
the Commissioner. Strict limitations are put on cash reserves, loans,
investments, equipment and pledging of assets. Directors must be
shareholders.

BANKING AND COMMERCIAL LAWS—DELAWARE
Use of the word “Trust” as a part of a corporate name is pro­
hibited. There is only one state bank, chartered in 1807. Minors
are recognized as adults in banking. Passing worthless checks with
intent to defraud is a crime, and it is prima facie evidence of fraud if
payment of check, fees and costs is not made within 10 days. The
Bank Commissioner has jurisdiction over the business of receiving
deposits or payments on income contracts, annuity contracts or cer­
tificates, or annuity bonds. Registration and a certificate of authority
are required, but this does not apply to sellers of merchandise on
installments, insurance companies, building and loan associations,
banks or trust companies or surety companies authorized to do busi­
ness in the state. Companies engaged in making small loans are under
rigid control by statute and the Bank Commissioner.
Taxation is assessed on the true value of shares of stock. In savings
banks or societies, where there is no capital stock, taxes are assessed
on the average of deposits held during the preceding year. Such
taxes are a lien on the property of such savings banks or societies.
Bills and Notes. The Negotiable Instruments Law is in force;
it became law January 1, 1912.
Brokers must be licensed. An unlicensed broker cannot collect
commissions.
Building and Loan Associations are under the jurisdiction of
the State Bank Commissioner. The amount of premiums, fines, and
membership fees is limited to 5 per cent per month for six months
and Yi per cent per month thereafter. After six months’ arrearage,
a shareholder may be forced to withdraw. All fees, etc., in any one
association must be uniform. Funds may not be invested in cor­
porate stocks. An association may issue bonds or certificates or
indebtedness up to 25 per cent of dues paid in, at not over 6 per cent
per annum. The business must be licensed annually, and after July 1,
1931, it is a misdemeanor to solicit sales of shares on commission. An
annual statement of business is required, and a list of accounts and
standing thereof may be demanded. Failure to maintain standards
will expose associations to suit by the Attorney General and assump­
tion of its business by the Bank Commissioner.
Such associations are exempt from the attachment laws. No
limitation is placed on the lien of judgments on the bonds for loans.
Loans may be made with their own capital stock for security. Partial
payments of their mortgages do not have to be recorded. If funds
are in excess of requirements, they may be loaned to outsiders for not
over 6 per cent. Foreign associations must deposit sufficient securities
with the State Treasurer which, with the assets in the state, will be
equal to the indebtedness to shareholders in the state.
Chattel Mortgages. A bona fide mortgage of personal property
duly signed and sealed and acknowledged is a valid lien on the property
for five years, if recorded within 10 days of the date of acknowledg­
ment. It may be foreclosed in equity or by sci. fa. if defaulted for
60 days. Affidavit of bona fides must accompany the mortgage. It
is unlawful for the mortgagor to remove the goods from the county
without consent of the mortgagee.
Contracts are joint and several, unless otherwise expressed.
Bonds, specialties and notes in writing, payable to order or assigns,
are freely assignable; suits thereon are brought by the real party in
interest. Assignments of bonds and specialties must be under seal
and before one credible witness. A sealed agreement has its common
law significance. A sale of goods must be accompanied by payment
or security for payment, or delivery; if such goods subsequently come
into the vendor’s possession, they are liable to the demands of his
creditors. No action shall be brought whereby to charge any person
upon any agreement made upon consideration of marriage, or sale of
lands, or any agreement not to be performed within one year, or any
promise to answer for the debt, default or miscarriage of another, of
any sum over $25, unless reduced to writing or memorandum signed
by the party to be charged or his agent. Goods sold and delivered
and other matters properly chargeable in an account are excepted.
In such cases the oath of the plaintiff together with a book regularly
kept, is recognized as evidence. Bulk sales are presumed fraudulent
against creditors unless inventoried five days before sale and full
information is given by the purchaser to all creditors of the seller;
failure to comply is also a misdemeanor. Sales by personal represen­
tatives or public officers are excepted.
Corporations. Not less than three persons may form a corpora­
tion for any business except banking, municipal government or
charitable, penal or educational institutions. The certificate of incor­
poration must set forth the name; principal place of business in the
state; nature and purposes of the business; types and amount of stock
authorized, minimum of capitalization being $1,000; name and resi­
dence of incorporators; term of existence, which may be perpetual;
extent of liability of stockholders. Corporations have the power to
have succession in its corporate name, to sue and be sued, to have
a corporate seal, to hold real and personal property, to appoint officers
and agents, to make by-laws, to dissolve according to law, to conduct
business anywhere, and to exercise all the powers and privileges insofar
as may be necessary for the transaction of business. It may not
issue currency, receive deposits of money, or buy and sell foreign
money as a business. Corporations may hold and transfer their own
shares, but cannot vote them. The certificate may be amended.
Dividends are payable from annual net profits or net assets beyond
capital. At least three directors are required; the president must be
one. Other officers are elected by the board. Stock may be paid for
by cash, labor done, or real or personal property. No-par stock is
recognized, as are proxies, not over three years old, and voting trusts.
Meetings may be held outside the state, if so provided by the by-laws.
Shares of stock are intangible personalty. Fees are based on the
number of shares of stock authorized; minimum, $10. Taxes are
likewise based; minimum, $5, maximum, $25,000. An annual report
is required. Charters are avoided by proclamation if taxes are not
paid for two years in succession, although action may be brought by
the Attorney General for such taxes, and he may also have a receiver
appointed for the corporation.
Foreign corporations, except insurance companies, must register
with the Secretary of State in order to do business in Delaware, show­
ing its charter, an authorized agent in the state for service of process,
and a statement of its assets and liabilities, with a fee of $10. Excep­
tions: Mail order or similar business, one that merely employs sales­
men to solicit orders, one installing machinery sold outside the state
requiring technical skill, and those engaged in wholly interstate
business.
Courts. Supreme Court: regular term at Dover third Tuesday
in June and January; adjourned term is held first Tuesday after the
fourth Monday in October; special sessions are had at the call of the
Chancellor at Dover when deemed expedient by a majority of the
members.
Court of Chancery, Orphans Court: New Castle County at Wil­
mington, fourth Monday in March and second Monday in September.
Kent County at Dover, third Mondays in March and September and
second Mondays in June and December. Sussex County in George­
town, second Monday in March and first Mondays in June, Septem­
ber and December.
Superior Court and Court of General Sessions: New Castle County
at Wilmington, first Monday ih January, March, May, and November
and third Monday in September (for criminal cases only). Kent
County at Dover, first Monday in July and third Mondays in Febru­
ary, April and October. Sussex County at Georgetown, first Mondays
in February, April and October and last Monday in June.
Court of Oyer and Terminer meets on call of Judges.
The Superior Court has general jurisdiction in all civil cases, but if
suit is brought for less than $50, costs can not be recovered. The
Court of Common Pleas, for New Castle County, has contract juris­
diction up to $1,000. The Court of Common Pleas of Kent County,
created in 1931, has both contract and tort jurisdiction up to $1,000,
and a limited criminal jurisdiction; appeals are to the Superior Court


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2153

of Kent County. The jurisdiction of the Justices of the Peace is
limited to $500, exclusive of interest and costs.
Curtesy. The conveyance or devise of a married woman will not
divest the husband’s right to curtesy in her real estate. If a wife dies
intestate leaving a husband and issue, he is entitled to a life estate in
half of her realty. If she dies without issue, he is entitled to a life
estate in all of her realty.
Death, Presumption of, arises after seven years, as at common
law.
Decedents Estates. Letters of administration are granted to
(1) a person entitled to residue of personal property, or (2) a creditor,
or (3) to any suitable person. Executors or administrators must give
bond in double the estimated value of the personal property. The
order of payment of claims is (I) funeral expenses, (2) medical serv­
ices during last illness, (3) household and farm servants wages, not
over one year, (4) rent, not over one year, (5) judgments, (6) mort­
gages, recognizances, and other obligations of record, (7) sealed obliga­
tions, (8) contracts under hand for payment of money or delivery of
goods, and (9) other demands. If real estate is sold upon order of the
Orphans Court to pay debts, all liens thereon become of equal grade
and must be paid from the purchase money before other debts. Banks
are authorized to pay over personal deposits of decedents not exceeding
$75, not lass than 15 days after death to the wife, husband, children,
father, mother, sister or brother (preference in order named) without
requiring letters of administration; such payment is a full release for
the amount so paid. A widow of an intestate is entitled to $200 in
personal property of her choice. A debtor, in order to recover from
an estate, must make affidavit of non-payment of the debt by the
decedent. One year is allowed for the settlement of estates, but an
inventory is required within six months from granting of letters.
Escheat is recognized. Non-residents, banks and trust companies of
Delaware or elsewhere (if permitted by their charters) may act as
executor or administrator, but a foreign bank may only act to the
extent that a Delaware bank may act in the place of incorporation of
such foreign bank. General claims should be presented within six
months. Letters granted in another state are sufficient authority for
a personal representative to act in Delaware.
Deeds. Warranty deeds are customary. The words “grant and
convey ’ imply a special warranty against the grantor and his heirs,
and all claiming under him, in the absence of an express provision
otherwise. Deeds must be under seal and either acknowledged or
proved by a subscribing witness in open court to be acknowledged.
A deed of a corporation must be executed by the president or a vicepresident, duly authorized by resolution of the board of directors, or
by the legally constituted attorney of the corporation; the seal of the
corporation, attested by the secretary, must be affixed.
If a deed is not recorded within three months from date of acknowl­
edgment, it does not avail against a subsequent creditor, mortgagee,
or purchaser for a valuable consideration. A deed to two or more
persons creates a tenancy in common, unless to husband and wife,
when it creates a tenancy by the entireties.
Depositions may be by written interrogatories or orally; they are
taken before a Commissioner named by the applicant, by agreement,
or by the Court. With the interrogatories must be filed a list of wit­
nesses, who alone may be examined. If oral, all questions and answers
must be written down by the Commissioner or his duly qualified
stenographer.
Depositions may be taken to perpetuate tesitmony of aged, infirm
or going witnesses, but may be used in evidence only in case those
examined are unable to attend the trial. In cases of boundary dis­
putes, such testimony may be preserved by order of the chancellor.
Registers and justices of the peace may take depositions of those
beyond the reach of process or of those who are sick.
Descent and Distribution. Real estate descends in fee unless
otherwise provided, to (I) children in equal shares and lawful issue
of deceased children by representation, (2) father and mother, as
tenants by the entireties, unless divorced, in which case as tenants
in common; if one only survives, then in fee. (3) (a) brothers and
sisters of whole blood and lawful issue by representation, (b) brothers
and sisters of half blood and lawful issue by representation. (4) Next
of kin, or lawful issue, with preference to those claiming through the
nearest, common ancestor. (5) Curtesy and dower are saved (see
those titles). (6) If no kin or heir of intestate, then to his or her
spouse in fee.
Personal Estate (1) children and lawful issue surviving deceased
children, (2) father and mother in equal shares, or all to survivor,
(3) brothers and sisters of whole blood and lawful issue surviving,
(4) brothers and sisters of the half blood and lawful issue surviving,
(5) next of kin in equal degrees, and lawful issue of such as are deceased.
Provided, (1) if intestate is married person without issue, spouse takes
entire estate, and (2) if with children, spouse takes one-third and
children take two-thirds.
Duly adopted children are recognized as of the whole blood. Ad­
vancements to children of real or personal property are deemed to
be in lieu of their share pro tanto, but do not affect dower. Descent
from an illegitimate child is first to its mother, and after that to her
heirs. An illegitimate child shares with legitimate children or their
issue in property descending from the mother. A child legitimated
by either marriage before birth or marriage after acknowledgment
of paternity takes as though legitimate. A child acknowledged with­
out marriage cannot inherit from its father.
Dower. A widow is entitled to a life estate in an undivided third
of all real estate held by her husband, free from lien or other alienation
unless relinquished by her. If the husband dies intestate, the widow
becomes tenant in dower of one half, and if he dies without issue,
then all of his real estate. Dower may be alienated by antenuptual
contract. A widow has the election of taking dower or devise. Dower
is barred by the widow’s having lived in adultery without her husband’s
connivance or reconciliation. Dower may be barred by the wife’s
deed, or upon sale of the lands by the executor or administrator to
pay debts of the decedent.
Executions. An execution becomes a lien on personalty when
delivered to the sheriff, and binds all goods actually levied upon for
60 days. Priority of writs is based on the time of delivery. A sale
cannot be had for 30 days after levy, unless goods are perishable.
The lien is valid for 3 years as against subsequent execution on the
same goods. Executions issued by justices of the peace must be levied
on in 30 days and the lien continues for two years. Goods are liable
to one year’s rent in preference to execution. There is no redemption
of property sold on execution. A stay of six months is granted to
defendant from judgment for want of an affidavit'of defense, when
security is posted. Before justices of the peace, six months stay may
be obtained by pleading freehold and nine months by posting security.
Exemptions. Family Bible, school books, family library, family
pictures, seat or pew in church, lot in burial ground, all wearing apparel
of debtor or his family, and, in addition tools or fixtures necessary
to carry on a trade, value not exceeding $75 in New Castle and Sussex
counties and $50 in Kent county. Sewing machines owned and used
by seamstresses and private families are exempt, and pianos and
organs which are rented are not liable to distress if the owner has
notified the landlord of his title. The above exemptions apply to
distress for rent as well as to ordinary executions. There is a further
exemption to head of families of personal property of $200 in New
Castle county and of $150 of household goods in Kent county; but
this does not include goods bought to be sold in the regular transaction
of business by the debtor. There is no such exemption in Sussex
county. This latter exemption will not avail against a judgment for
work and labor held by an employee. In New Castle county, 90 per
cent of all wages are exempt from attachment, and balance, not
over $50, may be taken for board and lodging. No exemptions are
recognized on a sale for taxes. Any husband and wife may make a
joint waiver of exemption.

2154

BANKING AND COMMERCIAL LAWS—DISTRICT OF COLUMBIA

Frauds, Statute of, see Contracts.
Fraudulent Sale of Securities. Jurisdiction has been conferred
on the Chancellor to enjoin the fraudulent sale or exchange of securities
in the State, upon the verified petition of the Attorney General.
Homestead. There is no homestead law in Delaware.
Insolvent Laws exist and may be applied in the absence of equiva­
lent provisions in the Federal Bankruptcy Act. They are seldom
resorted to. There is no provision for a general discharge.
Insurance. The insurance law was codified in 1931. The InsuranceCommissioner has complete supervision of all insurance companies,
agents and brokers, including the collection of taxes. A certificate of
authority to do business is required of all companies; it may be
revoked for insolvency, fraudulent operation, insufficient assets,
failure to comply with laws, or financial instability. A foreign or
alien company must file copies of its charter, by-laws, policy forms,
authorization to do business in its home state, and an appointment of
the Commissioner as agent upon whom process may be served. An
annual statement of financial condition is required. The resident
agent must countersign all policies. A domestic company cannot do
business elsewhere without a certificate of authority. Political con­
tributions, defamation of rival companies, misrepresentations as to
policies and rebates are prohibited. Real estate holdings and invest­
ments are strictly limited by statute. No person may insure the life
or health of another without his consent, except a wife for her hus­
band, an employer for his employees collectively, or heads of educa­
tional institutions for health of students. Insurance agents and
brokers must be licensed to do business.
The Insurance Commissioner likewise has jurisdiction over domestic
and foreign surety and guaranty companies and title insurance
companies.
Interest. The legal rate is 6 per cent. Any person who takes
more for the use or the loan of money shall forfeit to one suing for the
same a sum equal to the money loaned, one-half for the use of the
State, the other half for the party suing. Properly registered “small
loan” companies, firms or individuals may charge 11 per cent (legal
rate plus 5 per cent) on amounts not over $500. Banks are not
entitled to such registration, unless such powers are acquired by
merger with a registered loan company. State banks may not make
a profit of more than one per cent for sixty days, but exchange charges
may be added.
Judgments are a lien from the date of signing or entry, or, if on a
jury trial, from the date of the verdict. If the amount is not deter­
mined, it is a lien from date of entry only if amount is ascertained and
entered before the first day of the next term; otherwise, the lien com­
mences on date of entry of amount. No judgments are entered by
confession in New Castle County, in spite of a statute permitting it.
Satisfaction must be entered in 60 days. If a testatum fi. fa. is issued,
the Prothonotary must notify other counties within thirty days.
Failure to mark record creates liability to damage suit, and rule to
show cause thereon may be served by publication.
A foreign judgment will found an action in debt in Delaware. If
the plaintiff files an affidavit of demand, with a certified copy of the
judgment, judgment may be had at the first term for want of an
affidavit of defense, although appearance may have been entered.
The only defenses recognized go to the jurisdiction of the court render­
ing the foreign judgment.
Legal Holidays. January 1, February 12, February 22, May 30,
July 4, October 12, November 11, December 25, also Labor Day,
Thanksgiving Day when proclaimed, and General Election Day as it
biennially occurs. In New Castle and Kent counties, Saturday after­
noon after 12; but business done by a bank after 12 on Saturday
is legal if it would have been legal, if done before 12 on the same
Saturday. When a holiday falls on Sunday, the Monday following
is a legal holiday.
Limitations. Six months; Mesne profits after ejectment or man­
date of affirmance if appeal is taken. No recovery is allowed for
three years next preceding the ejectment.
One year: Actions for personal injuries, forfeiture on a penal
statute, forcible entry, and any suit where prior suit failed for want of
service or reversal on appeal.
Two years: Forcible detainer.
Three years: Guardian’s bond, recognizance in Orphans Court,
official bond, waste, and all personal actions. Mutual running
accounts do not accrue while open and current.
Six years: Sheriff’s official recognizance, testamentary bond, bills,
notes and acknowledgments of debt signed by the debtor.
Seven years: After expiration of term of office of Escheator on his
bond.
Twenty years: Real estate titles. Only ten years is allowed after
removal of disability.
Infancy, coverture or mental incompetency will bar the running
of the statute. If the defendant is absent from the state when the
action accrues, the limitation runs from the entry into the state.
Absence after accrual bars running of the statute until return.
Appeals from an interlocutory decree in equity must be presented
at the first day of the next term of the Supreme Court; from a final
decree, two years from signing the decree; taking exceptions to account
of executor or administrator, three years; partition, three months.
In other cases, rules of court apply.
Married Women may freely alienate all property and contract
as though unmarried. A married woman may not affect her husband's
right of curtesy, unless he has abandoned her without just cause. She
may sue and be sued. A husband is liable on his wife’s mortgage
bond only if he joins in executing it.
Mechanics Liens. The contractor has a lien on buildings and
land for money due for construction or repairs; his claim must be
filed within thirty days after ninety days have elapsed from the com­
pletion of the work. All other claims must be filed within the ninetyday period. Proceedings are by sci. fa., and judgment may be had
for failure to file an affidavit of defense. Execution is by levari facias.
Mortgages are executed like deeds, usually accompanied by bond.
Foreclosure must be by intervention by the proper court. Priority
of mortgages is based on the date of recording. Lien of purchase
money mortgage is superior to all other liens on the property, if
recorded within five days from date of sale. Satisfaction must be
entered on the record within sixty days from payment; failure to do
so will render the mortgagee liable to court action and for damages.
One witness is required on an assignment. Release of part of lands
does not affect the balance, but it must be under seal and recorded
within sixty days.
Partnerships and associations using trade names must register
them with prothonotary, together with the full names of each and
every person comprising such firm. The portion of this law requiring
individuals to do likewise has been declared unconstitutional. Juris­
diction of dissolution of partnerships is in the Court of Chancery.
Limited partnerships may be formed for any business but banking
and insurance. A record of members and their liability must be filed
with the Recorder of every county in which the firm does business.
Protest is required on foreign bills, otherwise optional. (N. I. L.,
§118.)
Replevin, as defined by statute, includes the unlawful detention
of any goods or chattels from the owner or person entitled to posses­
sion thereof. It lies against an officer for unlawful execution levied
on goods. Bringing the suit is sufficient proof of demand. Other­
wise, the common law rules apply.
Sales. See Contracts.
Tax Liens. Taxes are a primary lien on all real estate for two
years. If lahd is sold by order of the Orphans Court the lien transfers
to funds in the hands of the officer so selling, and continues as a lien
on the land for balance due. A tax lien against banks is discharged
only by payment.


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Trade Marks may be registered with the Secretary of State, as
may be labels or forms of advertisement, by filing two copies thereof
with him. The remedy for infringement is by bill for injunction.
There is also a criminal penalty for unauthorized use.
Trustees. Trust companies incorporated under the laws of Dela­
ware and having their principal place of business there may be
appointed to any office of trust without giving surety on their bond
for faithful performance. A liability growing out of a trust estate
is a first lien on the company's real estate. National banks located
in the state are accorded the same powers, and security on their bonds
may not be required, in the discretion of the appointing authority.
Trustees must file a just and true account at least every two years
with the Register in Chancery.
Trust Investments may be any of the following: (a) Those
specified by trust deed, (b) Bonds of the United States, or any
State; of any county, school district or incorporated city or town of
Delaware; of any city in United States of over 100,000 population,
if net debt is not over 10 per cent of assessed valuation of taxable
property; first mortgage bonds on real estate without prior encum­
brance, and not exceeding 60 per cent of the value of the land when
invested; bonds of railroads whose earnings for five years average one
and one-half times the fixed charges; bonds of transportation or
public service companies whose earnings for five years average two
times the fixed charges; bonds of industrial companies whose earn­
ings for five years average three times the fixed charges; equipment
trust obligations, covering not over 80 per cent of the cost, which
mature in 15 years payable in installments beginning not later than
three years from date of issue; bonds of railroad or transportation
companies guaranteed by a corporation whose bonds satisfy require­
ments above; and securities of any kind approved by the court
having jurisdiction.
Responsibility for due care in selection still rests upon fiduciaries.
Other property may be taken and held while prudent, but may not
be purchased. Investments legal under prior laws may be retained,
but when sold, the proceeds must be applied in accordance with the
above.
Uniform Acts adopted are; Aeronautics, Bills of Lading, Condi­
tional Sales, Federal Tax Liens, Fraudulent Conveyances, Negotiable
Instruments, Non-Support; Warehouse Receipts.
Wills. Any persoh of the age of twenty-one or upward, of sound
mind, may make a will. It must be in writing and signed by the
testator or some person subscribing the testator’s name in his presence
and by his express direction. It must be attested and subscribed by
two or more credible witnesses. Nuncupative wills are accorded a
limited recognition.
Probate proceedings are held before the Register of Wills of the
county in which the decedent was a resident. Appeals are usually to
the Superior Court, although exceptions to accounts of executors are
heard by the Orphans Court. Probate of foreign wills is authorized
when there is filed with the Register of the county where the property
is located, a certified copy of the probate proceedings from the place
of the testator’s domicile; such wills are recognized as to personal
property although they may not conform to local requirements.
Devise without limitation passes a fee. After-acquired land passes
by will. A will is revocable by cancellation, a writing executed by
the testator in testamentary form, by implication, and also by the
birth of a child subsequent to making of the will, should it contain
no provision for any child. After-born children take their intestate
share of the estate, in the absence of provision to the contrary. Mar­
riage after the execution of a will by a husband entitles his widow to
her intestate share, which must be contributed ratably by all the
beneficiaries. Posthumous children born alive are considered as
after-born children. A devise or legacy to a child, lineal descendant,
brother, sister, nephew or niece does not lapse on his or her decease
prior to that of the testator, but passes to their surviving issue. A
legacy is not satisfaction of a debt, unless a contrary intent clearly
appears.

SYNOPSIS OF

THE LAWS OF
THE DISTRICT OF COLUMBIA
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Dulany, & ITeth, Attorneys at Law, Wilkins Bldg.,
Washington, D. C. (See card in Attorney List.)
Acknowledgments. The deed of a corporation shall be executed
by having the seal of the corporation attached and being signed with
the name of the corporation, by its president or other officer, and shall
be acknowledged as the deed of the corporation by an attorney
appointed for that purpose, by a power of attorney embodied in the
deed or by one separate therefrom, under the corporate seal, to be
annexed to and recorded with the deed.
Acknowledgment of Deeds. When any deed or contract under
seal relating to land is to be acknowledged out of the District of
Columbia, but within the United States, the acknowledgment may
be made before any judge of a court of record and of law, or any
chancellor of a State, any judge or justice of the supreme, circuit, or
territorial courts of the United States, or any justice of the peace or
notary public; Provided that the certificate of acknowledgment
aforesaid, made by any officer of a State or Territory, not having a
seal, shall be accompanied by a certificate of the register, clerk, or
other public officer that the officer taking said acknowledgment was
in fact the officer he professed to be. Deeds made in a foreign coun­
try may be acknowledged before any judge or notary public, or before
anysecretary of legation or consular officer or acting consular officer
of the United States as such consular officer is described in section 1674
of the revised statutes of the United States, and when the acknowl­
edgment is made before any other officer other than a secretary of
legation or consular officer or acting consular officer of the United
States, the official character of the person taking the acknowledgment
shall be certified in the manner prescribed as to deeds out of the Dis­
trict of Columbia but within the United States. No deeds of con­
veyance of either real or personal estate by individuals shall be exe­
cuted or acknowledged by attorney.
Actions. The common law forms of actions are used except as
modified by statutes.
Administration. The probate court, a special term of the
supreme court of the District of Columbia, has exclusive jurisdiction
of the settlement of estates. A written petition stating the facta
in the case must be filed with the register of wills. This petition is

BANKING AND COMMERCIAL LAWS—DISTRICT OF COLUMBIA
acted upon by a justice of the supreme court of the District, who sits
daily. All executors and administrators and guardians are required
to give bond with security to be approved by the court. The testator
may waive the giving of bond, but the court always requires a bond
sufficient to cover the debts and legacies of the deceased not to exceed
double the value of the personal estate. By act of Congress, certain
trust companies incorporated thereunder may act as executor or ad­
ministrator without bond, and corporations having power under their
charters may act as sureties in all cases where individuals can. Credi­
tors may be barred in thirteen months provided the required notice
Is properly published. Probate court may order sale of real estate to
pay debts, in case personal assets are insufficient. Assets of non-resi­
dents in District of Columbia are subject to claims of local creditors
for one year after death.
Affidavits. Affidavits for use in the District of Columbia should
be taken before a justice of the peace, notary public, judge of any
court of record, or a United States commissioner. If taken before a
Justice of the peace, a certificate of his official authority from a clerk
of a court of record should be attached.
Aliens. Aliens may hold real and personal property in the District
of Columbia, and may acquire real estate by descent. Alien corpora­
tions are prohibited from acquiring real estate. Corporations of which
over 50 per cent of the stock is or may be owned by persons or asso­
ciations not citizens of United States can not acquire or own real
estate in District of Columbia.
Appeals. Appeals from the Municipal Court to the Supreme Court
of the District are now abolished. Writs of error from the Court of
Appeals of the District may Issue to the Municipal Court for the
review of judgments on questions of law. Appeals may be taken
from the supreme court of the District of Columbia to the court of
appeals of the District of Columbia. Certain cases are appealable
direct to the Court of Appeals. Appeals may be taken from the court
of appeals to the supreme court of the United States:
1. In cases where jurisdiction of trial court is in issue.
2. Prize cases.
3. Constitutional questions or treaties involved.
4. Where validity of any authority exercised under U. S., by an
officer is in question and
5. Construction of any law of U. S. is drawn in question.
Arrest. There is no Imprisonment for debt In the District of
Columbia. The court has the power to imprison for non-payment of
alimony in divorce cases, and for contempt of court.
Attachments. In any action at law In the Supreme Court of
the District of Columbia or the Municipal Court of said District, for
the recovery of specific personal property, or a debt, or damages for
the breach of a contract, express or implied, if the plaintiff, his agent
or attorney, either at the commencement of the action or pending the
same, shall file an affidavit showing the grounds of his claim and setting
forth that the plaintiff has a just right to recover what is claimed
in his declaration, and where the action is to recover specific personal
property stating the nature and, according to affiant’s belief, the value
of said property and the probable amount of damages to wnich the
plaintiff is entitled for the detention thereof, and where the action is
to recover a debt stating the amount thereof, and where the action is
to recover damages for the breach of a contract setting out, specif­
ically and in detail, the breach complained of and the actual damage
resulting therefrom, and also stating either, first, that the defendant
is a foreign corporation or is not a resident of the District, or has
been absent therefrom for at least six months; or, second, that the
defendant evades the service of ordinary process by concealing him­
self or temporarily withdrawing himself from the District; or, third,
that he has removed or is about to remove some or all of his property
from the District, so as to defeat just demands against him; or,
fourth, that he has assigned, conveyed, disposed of, or secreted, or
is about to assign, convey, dispose of, or secrete his property with
intent to hinder, delay, or defraud his creditors; or, fifth, that the
defendant fraudulently contracted the debt or incurred the obligation
respecting which the action is brought, the clerk shall issue a writ
of attachment and garnishment, to be levied upon so much of the
lands, tenements, goods, chattels, and credits of the defendant as
may be necessary to satisfy the claim of the plaintiff: Provided, That
the plaintiff shall first file in the clerk’s office a bond, executed by
himself or his agent, with security to be approved by the clerk, in
twice the amount of his claim, conditioned to make good to the
defendant all costs and damages which he may sustain by reason of
the wrongful suing out of the attachment.
Bills and Notes. Uniform Negotiable Instruments Act in force,
adopted January 12, 1899.
Chattel Mortgages. No bill of sale or mortgage or deed of trust
to secure a debt of any personal chattels whereof the vendor, mort­
gagor, or donor shall remain in possession, is valid and effectual to
pass the title herein, except as between the parties to such instru­
ment and as to other persons having actual notice of it, unless the
same be executed and acknowledged and within ten days from the
date of such acknowledgment recorded in the same manner as deeds
of real estate; and as to third persons not having notice of it, such
instrument shall be operative only from the time within said ten
days when it is delivered to the recorder of deeds to be recorded.
Collaterals. The holder of the note as collateral security for debt
stands upon the same footing as the purchaser and may maintain suit
thereon for his own benefit. The collateral pledged may be sold in
accordance with the terms of the collateral note which usually pro­
vides that the collateral may be sold upon non-payment of the prin­
cipal of the note, either at public or private sale, and in such cases the
purchaser at any such sale obtains a valid title to the collateral sold.
Contracts. Every contract and obligation entered into by two
or more persons, whether partners or merely joint contractors, whether
under seal or not, written or verbal, and whether expressed to be
joint and several or not, is for the purposes of suit deemed joint and
several. On the death of one or more of such persons, his or their
executors, administrators, or heirs are bound by said contract in the
same manner and to the same extent as if the same were expressed
to be joint and several. In actions ex contractu against alleged joint
debtors it is not necessary for the plaintiff to prove their joint lia­
bility in order to maintain his action, but he is entitled to recover,
as in actions ex delicto, against such of the defendants as shall be
shown by the evidence to be jointly indebted to him, or against one
only, if he alone is shown to be indebted to him, and judgment will
be rendered as if the others had not been joined in the suit. Any of
several joint debtors, when their debt is overdue, may make a separate
composition or compromise with their creditors.
Corporations. Any three or more persons may form a company
for the purpose of carrying on any enterprise or business which may be
lawfully conducted by an individual, excepting banks of circulation
or discount, railroads and such other enterprise or business as is other­
wise provided for. Such corporations may have a perpetual existence.
No such company is authorized to transact business until 10 per cent
of the capital stock shall have been actually paid in, either in money
or property at its actual value; and the recorder of deeds, before
filing any certificate of incorporation, must be satisfied that the entire
capital stock has been subscribed for in good faith. All of the stock­
holders of such company are severally and individually liable to the
creditors of the company in which they are stockholders for the unpaid
amount due upon the shares of said stock held by them respectively
for all debts and contracts made by such company, until the whole
amount of capital stock fixed and limited by such company shall have
been paid in, and a certificate thereof shall have been made and
recorded. Every such company must annually, except insurance
companies, within twenty days from the first of January, make a
report, which shall be duly published and which report shall state the


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2155

amount of capital and the proportion actually paid and the amount of
existing debts, foreign corporations doing business in the District
of Columbia are subject to service of process on their agents or on
the persons conducting their business, or by leaving copy thereof at
the principal place of business of such company, or at the residence
of its agent. The affairs of the corporation shall be managed by not
less than three nor more than fifteen trustees, a majority of whom
must be residents of the District, to be annually elected, except for
the first year, by the stockholders, at such time and place as may be
rovided by the by-laws. The fee of the recorder for filing all certicates of incorporation where capital stock is authorized is forty
(40) cents on each $1,000 of the amount of the capital stock of the
corporation, as set forth in its certificate, provided that no fee shall
be less than $25.
Courts in session continuously throughout the year. Suits on
contracts, accompanied by sufficient affidavit of right to recover, is
result in judgment in twenty days, exclusive of Sundays and legal
holidays, after day of service on defendant, unless defendant file and
affidavit setting forth facts which, if true, would in law constitute
a valid defense.
Days of Grace abolished.
Deeds. The following form of deed is now all that Is required in
the District of Columbia to convey a fee simple title to real estate:
This deed, made this. . . .day of............. in the year..... by me..........
of............. witnesseth: That in consideration of (here insert con­
sideration). 1. the said............. do grant unto (here insert grantee's
name), of............. all that (here describe the property)
Witness my hand and seal.
..................................(Seal.)
A deed must be acknowledged and recorded with the recorder of deeds
and takes effect from the time of recording. A scroll Is considered a
sufficient seal.
Depositions. Depositions of witnesses to be used in any civil
cause whether the case be at issue or not, may be taken under any of
the following conditions: 1. Where the witness lives beyond the
District of Columbia. 2. Where the witness is likely to go out of the
United States or out of the District and not return in time for the
trial. 3. Where the witness is infirm or aged, or for any reason the
party desiring his testimony fear he may not be able to secure the same
at the time of trial, whether the said witness resides within the Dis­
trict or not. 4. If during the trial any witness is unable, by reason
of sickness, or other cause, to attend the trial, the deposition of such
witness may, in the discretion of the court, be taken and read at the
trial. The deposition may be taken before any judge of any court of
the United States; before any commissioner or clerk of any court of
the United States, or any examiner in chancery of any court of the
United States; before anv chancellor, justice, or judge or clerk of
any court of any State or Territory or other place unaer the sover­
eignty of the United States, or any notary public or justice of the
peace within any place under the sovereignty of the United States:
Provided, that no such person shall be eligible to take such deposition
who is counsel or attorney for any party to the cause, or who is in
anywise interested in the event of the cause.
Descent and Distribution. Real Estate. Lands of intestate
descend, first, to child or children equally. If there be children of a
deceased child, these children take (equally) the share of their immedi­
ate ancestor. If no child' or descendant of such child, and the estate
descended to intestate on the part of the father, then it goes to the
brothers and sisters of the intestate of the blood of the father, and
their descendants equally. If there be no such brothers or sisters
or descendants, then it goes to the grandfather on the part of the
father; and if no such grandfather living, then it goes to the descend­
ants of such grandfather, and their descendants in equal degree equally:
and so on, passing to the next lineal male paternal ancestor, and if
none such, to his descendants in equal degree equally, without end;
and if no paternal ancestors or descendant from such ancestor, then
to the mother of the intestate, and if no mother living, then tip her
descendants in equal degree equally; and if there be no mother living
or descendants from such mother, then to the maternal ancestor and
their descendants in the same manner as above directed as to the
paternal ancestors and their descendants.
If the estate descended to intestate on part of mother, then it
follows the mother’s line, and afterwards that of the father, in manner
above indicated. If the estate vested in intestate by purchase, and
was not derived from or through either of his ancestors, and there
be no child or descendant of such intestate, then it descends to brothers
and sisters of whole blood, and their descendants in equal degree
equally; next to brothers and sisters of half blood, and their descend­
ants; next to father of intestate: next to mother; then to grandfather
on father’s side, or his descendants; then to grandfather on mother's
side, or his descendants, and so on, alternating next male paternal
ancestor and his descendants, and next male maternal ancestor and
his descendants.
Personal Estate. Surplus of personal estate of an Intestate, after
paying debts and expenses of administration, is to be distributed as
follows: If the intestate leave a widow or surviving husband and no
child, parent, grandchild, brother, or sister, or the child of a brother
or sister of the said intestate, the said widow or surviving husband shall
be entitled to the whole. If there be a widow or surviving husband
and a child or children, or a descendant or descendants from a child,
the widow or surviving husband shall have one third only. If there
be a widow or surviving husband and no child or descendants of the
Intestate, but the said intestate shall leave a father or mother, or
brother or sister, or child of a brother or sister, the widow or surviving
husband shall have one half. The surplus, exclusive of the widow’s
share, or the whole surplus (if there be no widow), shall go as follows:
If there be children and no other descendants, the surplus shall be
divided equally among them. If there be a child or children and a
child or children of a deceased child, the child or children of such
deceased child shall take such share as his, her, or their deceased
parent would, if living, be entitled to, and every other descendant or
descendants in existence at the death of the intestate shall stand in
the place of his, her, or their deceased ancestor. If there be a father
and no child or descendant, the father shall have the whole; and if there
be a mother and no father, child, or descendant, the mother shall
have the whole. If there be a brother or sister, or child or descendant
or a brother or sister, and no child, descendant, or father or mother
of the intestate, the said brother, sister, or child or descendant of a
brother or sister shall have the whole. Every brother and sister of
the intestate shall be entitled to an equal share, and the child or
children, or descendants of a brother or sister of the intestate, shall
stand in the place of their deceased parents respectively. After
children, descendants, father, mother, brothers, .and sisters of the
deceased and their descendants, all collateral relations in equal degree
shall take, and no representation among such collaterals shall be
allowed. If there be no collaterals, a grandfather may take, and if
there be two grandfathers they shall take alike; and a grandmother, in
case of the death of her husband, the grandfather, shall take as he
might have done. If any person entitled to distribution shall die
before the same shall be made, his or her share shall go to his or her
representatives. Posthumous children of intestate shall take in the
same manner as if they had been born before the decease of the
intestate, but no other posthumous relation shall be considered as
entitled to distribution in his or her own right. In the distribution
of personal estate there shall be no distinction between the whole
and half blood.
Dower. A wife is entitled to dower in all real estate owned by the
husband at the time of his death, including equitable as well as legal
estates.
Evidence. (See Depositions.)
Executions. Executions may be levied upon all goods and chat­
tels of the debtor not exempt, and upon gold and silver coin, bank
notes or other money, bills, checks, promissory notes or bonds, or
certificates of stock in corporations owned by said debtor, and upon
money owned by him in the hands of the marshal or of the constable

P

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BANKING AND COMMERCIAL LAWS—FLORIDA

charged with the execution of such writ, and also upon all legal lease­
hold and freehold estates of the debtor in land. Executions on judg­
ments before justices of the peace may be superseded, according to
the amount of the judgment, upon good and sufficient security being
entered by a person who may at the time be the owner of sufficient
real property located in the District, above all liabilities and exemp­
tions, to secure the debt, costs and interests from one to six months,
but there can be no stay of execution for wages of servants or common
laborers, nor upon any judgment for less than $5.
Exemptions. (Actual residents.) In addition to wearing ap­
parel, etc., household furniture to the value of $300, implements
of debtor's trade or business to the value of $200, stock for carrying
on business to amount of $200, one horse, harness and cart, wagon
or dray, and earnings of married men or heads of families, not to
exceed $100 per month for two months. Exemptions are only allowed
where the party claiming such is the head of a family or householder
residing in the District.
Foreign Judgments. Suits may be instituted in the supreme
court of the District of Columbia on any judgment of a court of record
in any other jurisdiction. The declaration in any such case must be
accompanied by a transcript of the record of such judgment verified
according to the act of congress in such cases made and provided, and
judgment in due course may be rendered on such transcript as in
any other case.
Garnishment. After judgment the writ of garnishment may
issue against specific property or credits in the hands of the garnishee
and on the return of the writ, if there be credits, the judgment or
condemnation follows. The writ of garnishment can not be issued
against the United States or the District of Columbia.
Holidays. Legal holidays are January 1st, February 22d.
May 30th, July 4th, first Monday in September (Labor Day), Decem­
ber 25th, or the following day when any of these dates fall on Sun­
day, and such day as may be appointed by the President of the
United States for fasting and prayer, and the day of the inauguration
of the President, in every fourth year, shall be holidays in the District
for all purposes. Every Saturday is a legal half holiday and notes
falling due on that day are not payable until Monday.
Husband and Wife. The wife’s property is exempt from the hus­
band’s debts. The husband may convey direct to his wife. The
wife may use all of her property of every description as fully as if she
were unmarried, and may dispose of the same by deed, etc., as fully
as if she were unmarried. She also has power to trade and to sue and
be sued, but no married woman under the age of twenty-one years can
make a valid deed or conveyance. On the death of a married woman
the husband is entitled to an estate by courtesy in her fee simple prop­
erty of which she dies intestate. The husband is not liable for the
debts of his wife contracted before marriage. A husband, who wil­
fully neglects to provide for wife or minor child under sixteen years,
in destitute circumstances, may be adjudged guilty of a misdemeanor,
and may be fined, or imprisoned, by the court having jurisdiction.
Interest. The legal rate of interest in the District of Columbia is
6 per cent, and in any suit where the contract is tainted with usury the
plaintiff forfeits the whole of the interest so contracted to be received,
and where usurious interest has been paid it can be recovered pro­
vided action for such recovery be brought within one year. In an
action on a contract for the payment of a higher rate of interest than
is lawful in the District, made or to be performed in any state or
territory of the United States where such contract rate of interest
is lawful, the judgment for the plaintiff shall include such contract
interest to the date of the judgment and interest thereafter at the
rate of 6 per centum per annum until paid. By express contract this
rate may be increased to 8 per cent.
Judgments. Every judgment is good and enforceable by an execu­
tion issued thereon for a period of twelve years from the date when an
execution might first have been issued thereon or from the date of the
last revival thereof by scire facias. Judgments of the municipal court
are good for six years, but are not liens on real estate until recorded in
the supreme court of the District of Columbia.
Jurisdiction. (See Actions, Appeals, and Municipal Court.)
Limitations. Fifteen years for recovery of lands, tenements or
hereditaments; executor's or administrator’s bond, five years; instru­
ments under seal, twelve years; simple contracts and recovery of per­
sonal property and damages for its unlawful detention, three years;
statutory penalty or forfeiture, libel, slander, assault, battery, may­
hem, wounding, malicious prosecution, false arrest or imprisonment,
one year; all other actions three years. Usual exceptions in favor
of persons under disability. Acknowledgment to revive action on
debt must be in writing. Part payment will take debt out of statute.
Married Women. (See Husband and Wife.)
Mortgages. Mortgages are almost entirely supplanted by deeds
of trust, requiring no court proceedings to foreclose. Joining the wife
is necessary to bar dower.
Municipal Court. By an act of Congress, effective June 1, 1921,
the Municipal Court of the District of Columbia was made a court
of record. It now has exclusive jurisdiction in all civil cases in which
the claimed value of personal property, debt or aamages exclusive
of interest and costs, does not exceed $1,000. When the value in
controversy shall exceed $20, and in all actions for the recovery of
the possession of real property, either party may demand a jury trial.
Judgments rendered by the Municipal Court remain in force for six
(6) years and no longer, unless it shall be docketed with the clerk of
the Supreme Court oi the District of Columbia, when it remains in
force for twelve (12) years.
No judgment shall be a lien upon the
defendants real property until so docketed.
Partnerships. Limited partnerships for the transaction of any
mercantile, mechanical, or manufacturing business within the District
may be formed by any two or more persons, but the number of special
partners is limited to six. The special partners are not liable for
the debts of the partnership beyond the fund contributed by them
to the capital. A certificate setting forth the firm name; general
nature of the business to be conducted; names of ail the general
and special partners interested therein, distinguishing which are
general and which are special, and their respective places of resi­
dence; the amount of capital contributed by each special partner
to the common stock; and the period at which the partnership is
to commence and terminate must be filed with the clerk of the supreme
court after having been acknowledged in the manner prescribed for
deeds.
Protest. May be made by a notary public under his hand and
seal; or by any respectable resident of the place where the bill is
dishonored, in the presence of two or more credible witnesses. Where
a foreign bill, appearing on its face to be such, is dishonored by nonacceptance, it must be duly protested for same; and where such a
bill which has not previously been dishonored by non-acceptance,
is dishonored by non-payment, it must be duly protested for same.
If it is not protested the drawer and indorsers are discharged. Where
a bill does not so appear to be a foreign bill, protest thereof in case
of dishonor is unnecessary. The protest must be annexed to the bill
or contain a copy thereof and must state the (1) time and place
for presentment; (2) the fact that presentment was made and the
manner thereof; (3) the cause or reason for protesting; (4) the demand
made and the answer given, if any, or the fact that the drawer or
acceptor cannot be found.
Records. The exemplification of the record under the hand of the
keeper of the same, and the seal of the office or court where such
record may be made, is good and sufficient evidence to prove any
record made or entered in any of the States or Territories of the United
States; and the certificate of the party purporting to be the keeper


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of such record, accompanied by such seal, is prima facie evidence
of that fact. A copy of the record of any deed or other instrument
in writing not of a testamentary character, where the laws of the
State, Territory, or country where the same may be recorded require
such record, and which has been recorded agreeably to such laws,
and the copy of any will which said laws require to be admitted
to probate and record, by judicial decree, and of the decree of the
court admitting the same to probate and record, under the hand
of the clerk or other keeper of such record and the seal of the court
or office in which the record has been made, is prima facie evidence
to prove the existence and contents of such deed, will, or other instru­
ment in writing, and that it was executed as it purports to have been.
Taxes. The rate of taxation is now subject to the will of Congress
to be fixed each year as may be expedient. At present the rate is
$1.80 per hundred upon assessed values of real and personal property.
Assessments of real estate are fixed at the fair cash value. Penalty
of 1 per cent per month for default in payment. A lien for real estate
taxes accrues on the date taxes are assessed- July 1st. Taxes are
payable, one-half on Sept. 1st and one-hair on March 1st of each
year, with 30 days grace tor payment berore penalty attaches. New
assessments are made every year for real estate (unless improve­
ments are put on) and every year for personal property by a permanent
Board of Assessors. Intangibles are taxed at the rate of one-half of
one percentum of the fair value thereof.
Trust Companies. Trust companies can be organized under the
general provisions of the code on that subject. No trust company
can be incorporated with less capital stock than $1,000,000. May
do a storage business with a capitalization of not less than $1,200,000.
Foreign companies desiring to operate in the District must first com­
ply with the provisions for the organization of trust companies under
the laws of this District.
Wills. All wills and testaments must be in writing and signed by
the testator, or by some other person in his presence and by his express
directions, and shall be attested and subscribed in the presence of
the said testator by at least two credible witnesses. No will, testa­
ment, or codicil is effectual for any purpose whatever unless the
person making the same be, if a male, of the full age of twenty-one
years, and if a female, of the full age of eighteen years, and be at
the time of executing or acknowledging it, of sound and disposing
mind and capable of executing a valid deed or contract. Any will
executed after January 17, 1887, and before January 1, 1902, devising
real estate, from which it shall appear that it was the intention of
the testator to devise property acquired after the execution thereof
shall be deemed, taken and held to operate as a valid devise of all
such property; and any will hereafter executed, which shall by words
of general import devise all of the estate or all of the real estate of
the testator shall be deemed, taken and held to operate as a valid
devise of any real estate acquired, by said testator after the execu­
tion thereof, unless an intention shall appear to ihe contrary. Where
a devisee or legatee dies before the testator, leaving issue, such issue
stands in the place of the deceased devisee or legatee unless a contrary
Intention appear from the will.

SYNOPSIS OF

THE LAWS OF FLORIDA
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by

Trot

C.

Davis

and

Harry

A.

Luetht,

Attorneys at Law, 402 Congress Bldg., Miami, Fla.

Accounts. Open accounts are barred in three years.
Acknowledgments must in every instance be under official seal.
If made in the State of Florida, may be made before any judge, justice
of the peace, clerk or deputy clerk of a court of record, or notary public;
or if made out of the State, and within the United States, before a
United States Commissioner of Deeds appointed by the governor of
this State, or before a judge or clerk of any court of the United States
or of any state, territory or district, having a seal, or before a notary
public or justice of the peace of such state, territory or district, having
an official seal, and the certificate of acknowledgment or proof shall
be under the seal of the court or officer as the case may be. If made
out of the United States, before any commissioner of deeds appointed
by the governor of the State to reside in such country, or any notary
public of such foreign country, or before any minister charge d’affaires,
consul-general, consul, vice-consul, commercial agent, or vice-com­
mercial agent of the United States appointed to reside in such country.
Conveyances of dower and powers of attorney for the execution of
deeds to real estate must be executed in like manner as conveyances of
real estate. A wife’s acknowledgment must be taken separate and
apart from her husband. Officers must certify that the grantors are
known to him. The following is the usual form adopted, viz:
State of Florida,
1
County of............................. )
Before the subscriber personally appeared........................................... and
his wife.................... known to me to be the individuals described in
and who executed the foregoing instrument who acknowledged that
they executed the same for the uses and purposes therein expressed
and the said..................................................................wife of the said............
............................. being by me further and privily examined separate
and apart from her said husband, acknowledged and declared that
she executed the same freely and voluntarily, and without fear, appre­
hension, compuision, or constraint of, or from her said husband, and
for the purpose of renouncing and relinquishing all her right, of what­
soever kind, in and to said property.
Given under my hand and seal official this................ day of.................
19....
Notary Public.
My commission expires.............................................................(See notaries.)
Actions. Suits shall be begun only in the county (or if less than
$100 in justice district) where the defendant resides, or where the
cause of action accrued, or where the property in litigation is. If
brought in any county where defendant does not reside, the plaintiff,
or some person in his behalf, shall file with the praecipe or bill in chan­
cery, an affidavit that the suit is brought in good faith and with no
intention to annoy the defendant. This latter provision does not
apply to suits against non-residents. Where there are joint defendants
suit may be brought in any court (or justice district) where any one of
the defendants resides, or where the cause of action accrued or where
the property in litigation is. Corporations (domestic) can only be
sued in a county where they keep an office. Foreign corporations may
be sued in any county where they have an agent, or where the cause
of action accrued or where the property in litigation is.

BANKING AND COMMERCIAL LAWS—FLORIDA
Administration of Estates. Upon the death of a person intestate
or having made a will but appointing no executor, the county judge
appoints an administrator, preferring first the next of kin; but if none
such apply, then, upon notice given by publication, any creditor or
suitable person. No minor can be appointed. If no one applies for
letters of administration within thirty days after death, the probate
court must order the sheriff to act. The administrator appointed by
the court must give bond in amount to be fixed by the probate judge,
respect being had to the value of the estate. The sheriff when acting
as administrator is liable upon his official bond. Claims against an
estate are barred after one year from date of notice given by adminis­
trator to present same. Claims are required to be filed in the office
of the County Judge. The compensation of the administrator is
determined by the court and, in addition to compensation for his
ordinary duties, not to exceed 6 per cent of money received for sales
made of personal and real property. Administrators must make
annual settlements before the first day of June each year or forfeit
commissions. The Circuit Court is empowered to authorize admin­
istrator or executor to carry on deceased’s trade or business for a
reasonable time.
Affidavits may be made before any judge, clerk of the circuit and
supreme courts, justice of the peace, or notary public.
Aliens. No distinction between any citizens, except that they are
not allowed to vote.
Appeals. Appellate proceedings for the common law side are by
writ of error, except where certiorari or prohibition lie, which must be
sued out within six months from the date of the judgment. The
record must be filed in appellate court on or before the return day of
the writ, under penalty of dismissal. Questions of fact can only be
taken up by bill of exceptions, which must be presented within the
term of the court unless by special order the time is extended. Appeals
in chancery may be taken within six months and the law governing
writs of error as far as it relates to filing of transcripts of records and
proceedings thereon and filing assignment of errors, the duty of
appellate court in giving judgment, in causing execution of its decrees
and quashing writs of error, are applicable to appeals in chancery.
Notice of appeal in chancery must be filed with clerk and recorded in
minutes. This gives appellate court jurisdiction.
Arbitration. Parties to the controversy may make a rule of court
of any arbitration to which they may desire to submit by filing a state­
ment of agreement of the matters they desire to arbitrate in writing
with the court having jurisdiction, which statement shall include the
names of the arbitrators and the umpire. An award upon such arbi­
tration can only be set aside for fraud, corruption, gross negligence,
or misbehavior of one or more of the arbitrators or umpire, or evident
mistake acknowledged by the arbitrators or umpire, who made and
signed the award.
Arrest. No arrest for non-payment of money unless it be for non­
payment of a fine lawfully imposed.
Assignments and Insolvency. Assignments by insolvents are
provided for by law. Preferences are not allowed. All property,
except that which is exempt, must be surrendered to the assignee.
Assignee gives bond and winds up estate.
Attachment process may issue upon affidavit made, setting forth
that amount is actually due; that plaintiff has reason to believe defend­
ant will fraudulently part with his property before judgment can be
recovered or is actually removing his property, or is about to remove
It out of the State, or resides beyond the limits thereof, or is actually
removing or about to remove out of the State, or absconds or conceals
himself or is secreting property or fradulently disposing of same, or
actually removing, or is about to remove, beyond the judicial circuit
In which he, she, or they reside. Attachment may also issue for a debt
not due, upon affidavit stating that the debt is actually existing, and
that the defendant is actually removing his property beyond the
limits of the State, or is fraudulently disposing of his property for
the purpose of avoiding the payment of his just debts or demands, or
Is fraudulently secreting his property for such purposes. The making
of the affidavit causes all debts to mature for the purpose of the suit.
Plaintiff must give bond, with two sureties in at least double the debt
or sum demanded. One surety is sufficient if that surety is a surety
company authorized to do business in the state of Florida Service
of notice of the suit may be either personal or by publication where
attachment is levied and property is not retaken by defendant. No
arrest allowed in civil actions. Writs of garnishment may be issued
both before and after judgment. If issued before judgment plaintiff,
his agent or attorney must make affidavit that the debt for which the
plaintiff sues is just, due and unpaid; that the garnishment applied
for is not sued out to injure either the defendant or the garnishee;
that he does not believe that defendant will have in his possession
after execution shall be issued visible property in this state and in
the county in which suit is pending upon which a levy can be made
sufficient to satisfy the amount of plaintiff’s claim, stating the amount,
and, except in cases in which plaintiff has had an attachment or
obtained his final judgment, he, his agent or attorney, must enter into
bond payable to defendant in double the amount of the debt, condi­
tioned to pay all costs and damages which defendant may sustain in
consequence of plaintiff’s improperly suing out the writ.
Banks. Corporations for carrying on the business of banking may
be formed by any number of persons not less than five, with a board
of directors consisting of not less than five nor more than twenty-five.
No banking company shall be organized with a capital of less than
$50,000, except that banks with a capital of not less than $25,000
may, with the approval of the comptroller, be organized in any city
or town containing not more than 3,000 inhabitants. The capital
stock shall be divided into shares of $100 each. Stockholders of
every banking, savings and trust company, shall be held individually
responsible equally and rateably and not for one another for all
contracts, debts and engagements of such company to the extent of
the amount of their stock therein at the par value thereof in addition
to the amount invested in such shares. Persons holding stock as
executors, administrators, guardians, or trustees are not personally
subject to any liability as stockholders; but the estates and funds
in their hands are liable to the same extent as a testator, intestate,
ward or person interested in trust funds would be if living and com­
petent to hold the stock in his own name. Banking corporations are
formed as other corporations and cannot begin business until author­
ized by the comptroller. Directors must be citizens of the United
States and at least three-fifths of the directors must have resided in
the State of Florida for at least one year preceding their election as
director and every director must own in his own right at least ten
shares of stock. Every banking firm, banking company or trust
company or liquidating agency, except national banks, shall be ex­
amined at least twice in each year by examiners appointed by the
State Comptroller, and shall furnish financial reports whenever called
upon by the State Comptroller. The comptroller on becoming satis­
fied of the insolvency of all banking corporations in the State except
national banks, or that the affairs of any such bank are in an unsound
condition or threatened with insolvency because of illegal or unsafe
investments, or that it is violating any of the laws of the State relative
to banking corporations, may in his discretion apply to the proper
court and have a liquidator take charge of the assets and affairs of
such banking corporation. Such liquidator is under the direct control
of the comptroller and may be removed by the comptroller. No new
private banks permitted after June 4, 1915.
Bills of Lading. Bills of lading are evidence against the carrier of
the direction by which freights are to be received, carried, and delivered
—collector or holder of commercial paper, attached to a bill of lading


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2157

not a warrantor of the quantity or quality of the goods represented
thereby, except by express contract in writing, and the officers, agents,
and employes of the carrier are required to comply with the terms of
the bill oi lading under penalty of criminal prosecution.
Blue Sky Law. “On 7-1-31 the Uniform Sale of Securities Act went
into effect and is administered by the Florida Securities Commission.’’
Chattel Mortgages and Deeds of Trust. All conveyances In­
tended to secure the payment of money are mortgages. Chattel
mortgages must be recorded or the property delivered to mortgagee
to make them effectual against bona fide creditors and purchasers for
value. Injunction will be granted against the removal of mortgaged
personalty from the State; can only be foreclosed by bill in chancery
unless under $100, and upon personal property, when a common law
action may be brought in justice of the peace court, and mortgage filed
with precipe. The form and effect of trust deeds have not been dis­
turbed by statute. It is a criminal offence to mortgage personal prop­
erty more than once without the consent of first lienor.
Checks and Drafts. It s a felony to obtain money or goods by
drawing and uttering check or draft having insufficient funds on
deposit to pay same, provided the check or draft is presented in due
course and drawer fails to pay same, or return the consideration
received, within twenty-four hours after written notice of dishonor.
Collateral Security. It is a misdemeanor to sell, pledge, loan, or
In any way dispose of collateral security without the consent of pledgor.
A written agreement may be made at the time of making the pledge
for the sale of the collateral in such manner and upon such terms as
the parties may desire, but notice must be given to pledgor ten days
prior to sale.
Conditional Sales Contract. Conditional sales contracts are
valid in Florida as such and may be either oral or in writing. No
requirement as to recordation until the elapse of two years from
date of delivery of the property. Invalid after two years against
purchasers or creditors unless recorded. For purpose of recordation
contract should be signed, sealed, witnessed and acknowledged before
a Notary Public.
Contracts. Statute of Frauds. In order to bind an admin­
istrator personally, or any one for the debt or default of another, or
one upon an agreement made in consideration of marriage; or upon
contracts for the sale oflands.tenements.or hereditaments or any uncer­
tain interest therein or for any lease thereof for a period longer than
one year; or upon an agreement not to be performed within one year,
there must be an agreement, note, or memorandum thereof in writing
signed by the party to be charged, or some one lawfully authorized
by him. Contracts for the sale of personal property must be in writing
or the property must be delivered or earnest money paid. News­
papers and periodicals must either be subscribed for or ordered in
writing.
Conveyances. (See Acknowledgments.) All conveyances of real
estate, or any interest therein for a term of years of more than two
years, must be by deed in writing, signed, sealed and delivered in the
presence of at least two subscribing witnesses; and in order to be
effectual against subsequent grantees or incumbrances, must be
recorded. The wife’s separate estate can be conveyed only by the
joint deed of herself and husband, and confirmed by her acknowledg­
ment, taken separate and apart from her husband. Words of limita­
tion unnecessary. Husband may convey direct to wife.
Corporations may be organized for any lawful business under the
General Corporation Law of 1925, except banking, trust, safety
deposit, building and loan, insurance, mutual fire insurance, surety,
express, railroad and canal, telegraph and telephone, cooperative,
fraternal, benefit, state fairs, and cemetery companies and corporations
not for benefit, which are organized under special acts. In general
corporations, stockholders are liable only for amount unpaid upon
subscription. Charter fee, payable to the Secretary of State, is $2.00
for every *1,000, of capital stock up to $125,000; $0.50 per $1,000, on
each additional *1,000, up to *1,000,000; $0.25 per *1,000 on each
additional $1,000 up to $2,000,000; and *0.10 for each $1,000 in excess
of *2,000,000. Corporations may have stock of no par value, and
upon such stock the fee is *0.20 a share up to 1,250 shares; $0.05 a
share in excess of 1,250 to 10,000 shares; $0.0025 a share in excess of
10,000 to 20,000 shares; and $0,001 a share in excess of 20,000 shares.
Minimum fee *10.00. All corporations required to file annual report
and pay annual tax on capital stock as follows: Capital stock author­
ized not exceeding $10,000, *10.00; exceeding *10,000 to *25,000,
$25.00; exceeding *25,000 to $50,000, *50.00; exceeding $50,000 to
*100,000, $75.00; exceeding $100,000 to $200,000, *100.00; exceeding
*200,000 to $500,000, $200.00; exceeding $500,000 to *1,000,000,
*500.00; exceeding *1,000,000 to *2,000,000, *750.00; exceeding
*2,000,000, $1,000.00. Corporations may pay annual tax of *1,000.00
and avoid filing report. Designation of resident agent for service of
process required of domestic and foreign corporations doing business
in the state.
Costs. Non-resident plaintiff required to give $100 bond to secure
costs. The defendant may have suit dismissed if bond is not given.
Courts. Circuit courts have original jurisdiction in all equity cases
and all cases at law not cognizable by inferior courts. County Courts,
in such counties as have County Courts, have jurisdiction of amounts
not exceeding *500.00. County Judge’s Courts have jurisdiction of
probate matters and, in counties where there are no Civil Courts of
Record, have civil jurisdiction up to *100.00. Justices of the Peace
have civil jurisdiction up to $100.00. In counties having a population
of more than 100,000 Civil Courts of Record are organized, with
jurisdiction from *100.00 to *5,000.00.
Creditors’ Bills may be brought before claim Is reduced to judg­
ment, but suit at law must be first brought and judgment must be
obtained before decree can be rendered.
Days of Grace are abolished.
Depositions may be taken upon commission when witness resides
out of the county, or is bound for sea, or is about to go out of the
State to remain until after the trial of the cause, or is very aged or
infirm; or when oath is made that a material part of the case or defense
depends upon the testimony of such witness. The time for the suing
out of the commission, the names of the witnesses, and the name of
one commissioner must be given to opposite side a reasonable time
before commission is issued. Printed instructions for the guidance of
commissioners usually accompany commission. Fees or not less than
$5 a witness are to be taxed as costs by the clerk and paid by losing
party.
Descent and Distribution of Property. Property descends: 1.
To the children and husband in equal shares. 2. If there be no
children then all to the husband or wife. 3. If there be no children,
husband or wife, then to the father and mother in equal shares, or to
survivor. 4. If no father or mother than to the brothers and sisters
and their descendants. 5. If there be no brother or sister nor their
descendants, then the estate shall be divided into moieties, one of
which shall go to the paternal and one to the maternal branches in
the following course' 1. To grandfather. 2. To grandmother, uncles

2158

BANKING AND COMMERCIAL LAWS—FLORIDA

and aunts. 3. To great-grandfathers. 4. To great-grandmother,
brothers and sisters of great-grandfathers, etc., passing first to near­
est lineal male and then to lineal female ancestors and their descend­
ants. The estate of an infant decedent, if without issue, leaving no
husband or wife, shall descend: 1. To father of infant. 2. Mother of
infant. 3. Brothers and sisters of infant. 4. In case no father, mother,
brothers or sisters or their descendants surviving, then it descends
according to the general rules of descent prescribed by statute. Halfbloods inherit only one-half. Adopted children are treated as children
of blood. Bastards inherit and transmit through mother’s side, as
if legitimate. Aliens have same right as citizens. There are no
entailed estates nor right of survivorship.
Dower. Deceased may not by will cut off his widow’s right to
dower. If dissatisfied with terms of will, she may dissent within
one year after probate of will and she will then be entitled to one-third
of the real estate for life, and, it there are two or more children, to
one-third of the personalty m fee simple: if there are no children, or
only one, she will be entitled to one-half the personalty. She may
within one year elect to take a child's part in lieu of dower. If the
husband die intestate, without children, the wife takes the whole
estate, or dower, at her election.
Evidence. Witnesses not disqualified by reason of interest. In
civil cases, husband and wife may testify for or against each other.
In suits by or against lunatics or personal representatives, heirs-atlaw, next of kin, assignee, legatee, devisee, or survivor of a person
deceased, no evidence of a transaction or communication between
such lunatic or deceased person and the opposing party or those under
whom he claims, can be given by the opposing party, unless such evi­
dence Is first offered In behalf of such lunatic representatives legatees,
devises, etc. No person is excused from testifying or producing
documents in trials for bribery, burglary, larceny, gambling, or illegal
sale of liquors, on ground that it may tend to convict him of crime
but no such person shall thereafter be prosecuted or subjected to any
penalty on account of anything concerning which he may so testify
or produce evidence.
Executions. Executions can be Issued immediately upon the
entry of the judgment and within three years thereafter, and are a lien
upon real estate from date of entry, and upon personal property from
the time the sheriff receives them. They can be renewed any time
within twenty years from entry of judgment. Both real and personal
property are subject to sale under execution. Executions are return­
able when satisfied, sheriff reporting progress at each term. Sale day
first Monday in each month. No stay law. No redemption of prop­
erty sold under execution.
Exemptions to every head of a family residing in the State home­
stead of 160 acres of land, and improvements, if in the country; onehalf acre of ground, if in an incorporated city or town, together with
$1,000 worth of personal property. The exemptions in a city or town
shall not extend to more improvements or buildings than the residence
and business house of the owner. No property is exempt from sale
for taxes or assessments, or for obligations contracted for its purchase,
or the erection or repair of improvements thereon, or for house, field,
or other labor performed thereon. Wages and salary of head of a
family residing in the State is exempt from garnishment.
Foreign Corporations. Commercial corporations can do business
In this State without restriction upon complying with requirements
as to foreign corporation, provided its name is not the same or so
nearly similar to any domestic corporation as to cause confusion.
(See Service of Process.)
Subject to same charter fees and annual taxes except that it is based
only on capital actually used in Florida.

laborers and material-men. Property for which materials are fur­
nished upon which labor has been done, is liable to persons not in
privity with owner to the extent of the unpaid balance of debt due
to contractor. Owner personally liable in like amount. Statutory
liens upon real estate, in order to be available as against subsequent
purchasers or lienors without notice, must be recorded, and suit
must be brought within twelve months after the furnishing of the
material, or the performance of the labor. Liens upon personal
property exist only while possession is retained by lienor.
Limitations of Actions. Civil actions can only be commenced
within the following periods after the cause of action shall have
accrued, to wit: Actions on Florida judgments, actions on con­
tracts or obligations in writing and under seal twenty (20) years;
actions for the recovery of real property, actions on judgments of
courts of the United States or any other state or territory seven (7)
years. On contracts in writing not under seal, five (5) years. On
all actions not herein and specifically mentioned, four (4) years.
Trespass to realty, action upon liability created by statute other
than a penalty of forfeiture, taking, detaining or Injury to chattels,
for relief on the ground of fraud, upon contract not founded upon
Instrument of writing, including an action open account for goods,
wares and merchandise, three (3) years. Actions for libel, slander,
assault, battery, false imprisonment, or an action by another than the
State upon a statute for a penalty or forfeiture two (2) years. Actions
for wrongful death of a child, actions against railroad companies for
killing cattle, and any action by the State for a statutory penalty or
forfeiture, one (I) year.
Married Women retain their property, real or personal, owned
at marriage or acquired thereafter by gift, devise, descent, or purchase,
and it is not liable for husband’s debts except by her written consent,
executed according to law regulating conveyances of married women.
Husband must join in all sales, transfers, and conveyances of the
wife’s property, except when he has been adjudged insane for more
than a year. Wife may sue concerning her real estate without joining
her husband with her in the suit. Widow takes as dower a life estate
In one-third part of the real estate of which her husband was seized
and possessed at any time during her coverture, and an absolute onethird of all personalty, or may at her option take as an heir equally
with the children of the husband, and if there are no children she will
Inherit all the property, real and personal. Wife by petition to proper
court may be decreed a free dealer and as such sue and be sued
Minors. Both sexes attain their legal majority at the age of 21
years. Minors who deposit in savings banks may control, transfer
or withdraw the money so deposited. All other contracts made by
them are voidable, except for necessaries. Marriage removes dis­
ability of non-age of male minor. Minors over 18 may have dis­
abilities removed by petition in chancery.

Interest. Eight per cent is allowed on judgments and contracts
where interest is payable but no rate is specified. Contract for more
than 10 per cent is usurious, and all interest forfeited.
Judgments of a court of record are a lien for twenty years upon
real estate of debtor within the county where rendered, and may be
extended to other counties by recording certified transcript of judg­
ment in any county where a lien is sought. Judgments of justice of the
peace may be made a lien upon real estate by recording in the office
of clerk of circuit court.

Mortgages of real estate must be executed and proved or acknowl­
edged in the same manner as deeds, and they, likewise assignments
thereof, to be effectual against creditors or bona fide purchasers,
must be recorded. Are foreclosed by bill in equity in the circuit
court. Chattel mortgages must be recorded unless property is
delivered to mortgagee and remains in his possession; becomes subject
to debts of mortgagee if left in his possession more than two years
without the mortgage being recorded.
Notaries. Both men and women over twenty-one years may be
appointed notaries public. They must renew commissions every four
years. May administer oaths, take acknowledgments and perform
marriage ceremony. $500 bond is required to be given. Certificate
must show date of expiration of commission.
Notes and Bills of Exchange. Uniform Negotiable Instrument
Act adopted.
Partnership, Limited, and Special. None. No uniform acts
adopted. Common law rules apply.
Powers of Attorney. Any contract or conveyance may be made
by power of attorney. A conveyance of a married woman’s real estate
by power of attorney in order to be valid the power of attorney must
be acknowledged by her separate and apart from her husband, and the
acknowledgment must state that she executes it freely and voluntarily,
without compulsion, fear, apprehension, or constraint of or from her
husband. The husband must join either in the deed or powers of
attorney. Powers of attorney for the conveyance of real estate must
be recorded.
Probate Law. (See Administration of Estates.) The county
Judge has original jurisdiction of all matters relating to the administra­
tion of estates of decedents.
Protest. (See Notes and Bills of Exchange.)
Records. Records of deeds and mortgages are kept in the office of
the clerks of the several circuit courts, and the original must be recorded
in the county within which the property lies. Wills are required
to be recorded with the several county judges and may be probated
In any county in which the deceased left property, if he dies out of the
State. If death takes place within the State, then in the county in
which he has had residence, house, or other place of abode at the time
of his death, and if he had none such, then in the county wherein he
died.
Redemption. None, excepting tax sales.
Replevin lies for goods or chattels wrongfully taken, except when
taken for taxes, or under execution, or at suit of defendant when the
property was originally replevied from defendant and has been
delivered to plaintiff, or when plaintiff is not entitled to possession.
Affidavit must be filed, describing property sought to be recovered,
and stating that it was not taken for any tax, fine levied by virtue of
any law of the State, nor seized under execution or attachment against
the goods and chattels of the plaintiff; liable to execution and bond
In double the value of the property with two sureties given before the
writ is issued. Defendant may release the property within three days
by forthcoming bond.
Seal. A scrawl or scroll, printed or written, affixed as a seal to any
written instrument, is effectual.
Service of Process. Out of circuit court, made by the sheriff or
his deputy. Out of county judge’s or justice of peace courts, may be
made by sheriff or constable. Service in civil actions may be made
either upon the person of the defendant, or by leaving a copy at his
residence with some person over fifteen years of age. Process against
a domestic or foreign corporation may be served upon anv officer or
business agent of said corporation residing in Florida. Domestic and
Foreign corporations are required to file with Secretary of State a
certificate designating an office for service of process, which office must
contain a sign with name of corporation and agent and must be kept
open and agent must be present from ten A. M. to twelve noon each
day except Sundays and Holidays. In lieu of such agent corporation
may designate Clerk of Circuit Court. Failure to comply with act
authorizes service by publication once each week for four weeks and
carries penalty of one dollar per day up to Two Hundred Fifty Dollars
Suits. Actions at law are commenced by filing a precipe with the
clerk. Personal service is required except in suits by attachment and
garnishment. Writs are returnable on the next rule day, provided
ten days intervene; if not, then on the rule day in the next succeeding
month. If no appearance of defendant, default is entered forthwith.
Default may be entered for want of plea or other pleading on rule day.
next after appearance day.

Liens. In order to secure a lien by lis pendens, a statement must
be filed with the clerk of the circuit court, and recorded by him in a
book kept for that purpose, setting forth the names of the parties and
the nature Oi the relief sought, and the description of the property
upon which it is desired to obtain a lien. Statutory liens are given to

Taxes. Taxes are not due and payable until the first day of Novem­
ber, and if not paid by first day of the following April property may be
sold. Owner has two years within which to redeem. Taxes are a
lien from the first day of the year of the assessment, and have the force
and effect of a judgment upon which execution may issue.

Foreign Judgments. Judgments obtained in the several courts
of the State, may be recorded in any county and have same force and
effect as if originally obtained therein. Judgments obtained in other
States or countries, merely evidence, and have to be sued upon to be
made effective as judgments.
Fraud. (See Limitations of Actions.) Obtaining money or prop­
erty under false pretense or by falsely personating another, are punish­
able criminally.
Garnishment. (See Attachment.)
Guaranty Companies. Guaranty Companies are permitted to
become surety upon bonds for all purposes after complying with certain
statutory requirements.
Holidays. Defined by statute are: Sundays, January 1st, January
19th, February 22d, Good Friday, April 26th, May 30th, June 3d,
July 4th, first Monday in September, second Friday in October.
November 11th, and general election days. Thanksgiving Day, Christ­
mas ana Shrove Tuesday or Mardi Gras in cities where there is a
Carnival Association organized for the purpose of celebrating it
When Christmas or any legal holiday falls on Sunday, the following
Monday is the legal holiday.
Husband and Wife. The husband has full control of wife's prop­
erty and is not chargeable by the wife with the rents and profits, but
he cannot charge for his services. Must be joined with wife in sales
of her property. Homestead can only be alienated by their joint
deed. Estates by entireties as at common law. Husband not liable
for wife’s antenuptial debts. Has no interest in her separate earnings.
Has action for negligence causing her death; wife’s property not
generally liable for husband’s debts. Wife may sue with respect to
separate estate without husband joining. Infant wife may join
husband in sale of real estate.
Injunctions. Injunctions are granted by Circuit Courts sitting
in chancery without bond upon affidavit of inability to give bond,
and upon proof satisfactory to the judge that such affidavit is true,
and that the statements of the bill are true. Injunctions are granted
to stay proceedings at law; to restrain the sale of property under
execution or decree obtained against one other than the owner of the
property; to restrain the destruction of timber by cutting, boxing, or
otherwise; to restrain a levy upon exempt property; to prevent the
claiming of exemptions upon property not legally exempt; to prevent
the removal from the State of mortgaged personal property, and to
abate bawdy houses and gambling dens.
Insolvency. Statutes suspended by national bankruptcy law.
Insurance Companies. Foreign and domestic, are placed, by
statute, under control of State treasurer. They must annually file
a statement with, and obtain from the State treasurer, a certificate
before being authorized to do business. Certificate may be revoked
If company refuses to pay judgments which have been legally obtained
against it.


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Federal Reserve Bank of St. Louis

BANKING AND COMMERCIAL LAWS—GEORGIA
Testimony.

(See Depositions.)

Transfer of Stock. Stock is transferable in the manner prescribed
in the by-laws. No stock can be transferred until, after all previous
assessments thereon have been fully paid. The transferee succeeds
to all the rights and liabilities of the prior holder.
Warehouse Receipts. Uniform Warehouse Receipts Act adopted,
and effective after July 31st. 1917.
Wills. Any person over twenty-one years old and of sound mind
may make a will. This includes married women. A married woman
may make a will even though she be a minor. Wills of real estate
must be signed by testator or some person in his presence and by his
express direction, and must have two witnesses who must subscribe
in testator’s presence and in presence of each other. Wills of personal
property must be in writing and signed by the testator or some one in
his presence, and by his express direction. Nuncupative wills are
good as to personal property. Revocation may be by subsequent
will or codicil attested like the original, or by burning, cancelling,
tearing or obliterating the same by the testator or by his direction
and consent, or by the act and operation of law. Wills must be
probated before admittance in evidence. Foreign wills, when duly
probated according to laws of the State, where made and duly recorded
in this State, are as effective as wills executed in this State. Foreign
wills are construed according to law of State where they are executed.

SYNOPSIS OF

THE LAWS OF GEORGIA
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Colquitt, Parker, Troutman and Arkwright,
Attorneys at Law, 1607 William Oliver Bldg.. Atlanta
Acknowledgments. (See Deeds.)
Actions. All distinction between suits at law and In equity la
abolished. Equitable relief can be had in superior courts of law.
Administration of Estates. Letters of administration issue in
the line of preference, first to the husband or wife, second to the next
of kin, relations by consanguinity are preferred to those by affinity.
If there are several of the next of kin in the same degree, preference
Is given to that one selected in writing by those most interested in
the estate. If no preference is expressed the ordinary exercises
his discretion. If no application Is made by next of kin a creditor
may be appointed, and if no application is made the ordinary will
vest the administration in a county administrator, an officer authorized
by statute for that purpose. Administrators must give bond in double
the value of the estate. Out of the estate of each deceased person,
the first charge, after funeral expenses, is a year’s support for the
family, to be laid off by commissioners according to the condition
and standing of the family. Foreign administrators may act In this
State on giving bond to the ordinary where they qualify. The bonds­
men must be residents of this State. A citizen of any other State may
act as executor of the will of a deceased citizen of this State when he
has the same interest and will give the same bond as in the case of
foreign administrators. Administrators of other States may sue In
this State by filing in the office of the clerk of the court, to which suit
is brought, a properly authenticated copy of their letters of adminis­
tration.
Affidavits. Pleas and defenses In the courts of this State which
are required to be under oath, may be made before any official of
the State or county where the oath is made, who is authorized by
the laws of such State or county to administer oaths. Prima Facie
the official attestation of the officer is evidence that he was author­
ized to act. Any non-resident seeking equitable relief, when called
on to verify proceedings, should be sworn before a commissioner of
this State, or a judge of a court of record where the )ath is made,
with the attestation of the clerk of such court that the signature of
the judge is genuine, and that the court over which he presides Is a
court of record.
Aliens. The subjects of governments at peace with the United
States and this State are entitled to the rights of citizens of other
States, resident here, in so far as they accord to them the privilege
of purchasing, holding, and conveying real estate.
Appeals. (See Courts.)
Arbitration. Under the law of Georgia disputes and controversies
relating to rights, or property, may be submitted to arbitration.
Arrest. The constitution of Georgia declares that there shall be
no imprisonment for debt. But in an action to recover personal
roperty wrongfully taken or withheld, the defendant will be arrested
y the officer to whom process is directed, and will be committed to
jail unless he shall give bond and good security, or deliver up the
property, or show to the satisfaction of the court that it is without
his power to produce it.
Assignments. Assignments for the benefit of creditors are per­
mitted.
Attachments. A summary process of attachment will lie in
the following cases: 1. Where the debtor resides out of the State.
2. Where he is actually removing, or about to remove, without the
limits of the county. 3. When he absconds. 4. When he resists
a legal arrest. 5. Where he is attempting to remove his property
beyond the limits of this State. 6. Where he has disposed of, or
threatens to conceal, his property, liable for the payment of his debts,
or shall make a fradulent lien thereon to avoid paying his debts.
Attachment will lie to recover the purchase money of an article sold
when the debtor is still in the possession of the property. Attach­
ments may issue upon affidavit by the plaintiff, his agent or attorney,
who must swear that one of the state of facts exists which authorize
an attachment, and also as to the amount of the claim. Bond and
security, in double the amount sworn to, must accompany the affidavit
and the officers require personal security. Non-resident corporations
are liable to attachments, and one non-resident may attach the
property of another non-resident in this State, except for wages
earned without the State.
Banks and Trust Companies. Any number of persons, not less
than five, may form a corporation for the purpose of carrying on the
business of banking. Such corporations, when organized, have power
to have continual succession for thirty years, with right of renewal; to
sue and be sued; to have and use a common seal; to appoint officers
and agents; to make by-laws; to hold, purchase, dispose of and con­
vey such real and personal property as may be necessary for its uses
and business; to discount bills, notes, or other evidences of debt; to
receive and pay out deposits, with or without interest; to receive
special deposits; to deal in foreign exchange; to lend money upon
personal security, or pledges of bonds, stocks, negotiable security; to
take and receive securities by mortgage or otherwise on property real

g


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Federal Reserve Bank of St. Louis

2159

or personal. The business of the corporation shall be under the
management and control of a board of directors, to consist of not less
than three or more than twenty-five of the members of the corporation,
who must be owners and holders of two or more shares. No bank
shall be chartered without a capital subscription in good faith of at
least $25,000, of which not less than 60 per cent must be paid in before
filing the declaration with the secretary of State. The corporation
shall be responsible to its creditors to the extent of its capital and
its assets, and each stockholder shall be individually liable for all
debts of the corporation to the extent of his unpaid shares of stock,
and shall be further and additionally liable, equally, and ratably (and
not one for another as sureties) to depositors of said corporation, for
all moneys deposited therein in an amount equal to the face value of
their respective shares. All corporations doing a banking business in
this state shall make to the State bank examiner, under oath, state­
ments showing the resources of the bank or corporation, at the close
of business on any day specified by the bank examiner. No bank shall
loan to its officers any money without good collateral, or other ample
security, and shall not be made until approved by a majority of the
board of directors. No bank or corporation doing banking business
shall reduce its cash in hand, including amount due by banks and
bankers, below 15 per cent of demand deposits. No bank or corpora­
tion doing a banking business shall loan to any one person more than
20 per cent of its capital stock and surplus. Banks may charge same
rate of interest as individuals and the rules of bank discount, that is
to say, taking interest in advance within the lawful rates, have been
held not usurious. No dividend shall be declared by any bank except
from the net profits, nor shall the capital stock be applied to the
purchase of its own shares. In the absence of a contract, expressed
or implied, to the contrary, the bank taking paper for collection is
liable for the defaults of its agents and correspondents to whom the
paper has been entrusted for collection. If any insolvent bank or
banker, with notice of such insolvency, shall receive money or general
deposits, and loss or injury result to such depositor, such banker or
officer in charge of the bank receiving the deposit shall be punished as
prescribed in the penal code. The State has a special lien for all
ubtle money deposited. State banks are authorized to become mamers of the Federal Reserve Bank. By Act of Legislature in 1927. all
trust companies were placed under the supervision of the Superin­
tendent of Banks.
Bills of Lading and Promissory Notes. A bona fide assignee
of a bill of lading of goods will be protected in his title against the
seller’s right of stoppage in transit. It is not necessary to protest
any negotiable instrument upon dishonor, except in case of foreign
bills of exchange. Accomodation endorsers, sureties and endorsers
may be sued in the same county and in the same action with the
maker, drawer or acceptor. Bills of exchange must be accepted in
writing to bind the acceptor. A contract to pay attorney’s fees
cannot be enforced unless the debtor when served ten days before
suit is filed with a written notice of intention to sue with amount
and term of court to which suit will be brought, shall fail to pay such
debt before return day. A waiver of homestead in a promissory
note is a bar to such a claim as against the collection of such note.
Promissory notes and contracts containing reservation of title to
personal property must be executed before a notary public, justice
of the peace, or clerk of a court of record, and must be recorded as
mortgages to hold such property as against third parties or innocent
purchasers.
Checks. (See Notes, etc.) If check or other instrument payable
on demand is not presented for payment within six months from date
thereof, same shall be regarded as stale and payment refused by bank
without incurring liability to drawer or maker for nonpayment.
Stop payment orders on checks or drafts must be renewed in writing
every ninety days after original order or notice to bank.
Collaterals. The holder of a note as collateral security for a debt
stands upon the same footing as the purchaser. Property left In
" ‘;eor pawn may be sold at public safe to the highest bidder, upon
y days’ notice.
Corporations. Power to create corporations In this State Is vested
In the general assembly and the superior courts. Said courts may
grant charters to all corporations except banking, insurance, canal,
navigation, express, and telegraph companies and railroads. The
Secretary of State may grant charters for the corporations above
enumerated In manner prescribed by law in the particular case. A
charter for a private corporation Is obtained by a petition to the
superior court, setting forth the object, particular business, corporation
name, capital, place of business, time for which incorporation is desired,
not exceeding twenty years. The petition and order granting the same
constitute the charter. In such corporations the liabilities of the
stockholder is measured by the amount of unpaid stock subscription
due by him. In the charter of many banks heretofore organized
under special act of the General Assembly the rule of personal liability
varies. In some banks stockholders are liable as partners: In others
liability exists under the general rule, viz., to the extent of twice the
amount of stock held, and in some banks liability exists only to the
extent of stock and unpaid subscriptions thereon. The payment of 10
per cent of the capital stock is necessary before commencing business.
General powers of corporations are conferred on all corporations
organized in this state. All corporations organized under the laws
of the State or doing business therein are required to register with
the Secretary of State and pay a graded license fee. with a minimum
of $10, maximum $1000. Voluntary dissolution of a corporation may
be granted by the Superior Court upon petition filed by the Corpor­
ation if authorized by two-thirds of capital stock. Lost stock
certificates must be established by petition to Superior Court.
Costs. A deposit of $10 Is required In courts of record from
non-resident plaintiffs before the filing of suits and a deposit of $6 In
all divorce cases.
Courts. The term, jurisdiction, etc., of the several courts of the
State are as follows: JUSTICE COURTS hold monthly sessions and
have civil jurisdiction up to $100. In criminal matters they are
only committing courts. COURTS OF ORDINARY hold their
sessions monthly and have jurisdiction over wills, administration of
estates, and of the conduct of administrators, executors and guardians.
COUNTY COURTS have monthly and quarterly sessions. Their
jurisdiction Is limited to controversies not exceeding $300. CITY
COURTS hold four sessions per annum, but the city court of Atlanta
has six terms. The jurisdiction of city courts is unlimited except In
matters of divorce, titles to land and administration of equitable relief.
The municipal court of Atlanta, recently established, replaces the
Justices Courts. Its Jurisdictional limit is $2500. It holds one term
eacn month. SUPERIOR COURTS have jurisdiction of all suits
and controversies and have exclusive jurisdiction In equity powers,
divorce cases, and suits involving titles to land, and on the criminal
side exclusive jurisdiction of all cases involving life or imprisonment
In the penitentiary.
Deeds. Deeds to real estate In Georgia must be in writing, and
should be executed in the presence of two witnesses, one of whom shall
be an officer authorized for that purpose. They should be recorded
In the office of the clerk of the superior court of the county where the
land lies, and all deeds, mortgages and other liens, should be recorded
immediately to be available against third parties and innocent pur­
chasers. To authorize the record of a deed to realty, it must be at­
tested by or acknowledged before, if executed out of this State, a
commissioner of deeds for the State of Georgia, notary public, clerk
of a court of record, or a consul, or vice-consul of the United States
(the certificates of these officers under their seals being evidence of
the fact). When the deed is executed out of this State before a
notary public, the attestation should be under his hand and official
seal. In case of acknowledgment it is better, as a matter of precaution,
always to have two witnesses, besides the officer who takes the acknowl­
edgment. If executed In this State, It must be attested by a judge of
a court of record of this State, or a justice of the peace, or notary

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public, or clerk of the superior court, in the county In which the three
last mentioned officers respectively hold their appointment, or if subse­
quent to its execution the deed is acknowledged in the presence of
either of the named officers, that fact, certified on the deed by such
officer, shall entitle it to be recorded. (Act of 1893.) Deeds to secure
loans are in more common use than mortgages because they have
been held to pass the absolute title and protect against year’s support
and dower, the equity of redemption remaining in the maker, can not
be levied upon until the debt secured by the deed has been paid
off. Under the law of Georgia these deeds can not be foreclosed as
mortgages, the notes they are given to secure must be sued to judg­
ment, the land must be re-conveyed to the grantor, and then levied
on, but the lien of the judgment relates back to the date of the con­
veyance. In the Federal courts, however, foreclosure can be made
In equity as in the case of ordinary mortgages. Usury will, however,
void such a conveyance, only as to the interest paid on such debt.
Depositions. Testimony is taken in this State by written inter­
rogatories where the witness is a female, or where the witness does
not reside in the county where the suit is pending, or by reason of disa­
bility is unable to attend court. In all counties within this State,
depositions may be taken upon five days’ notice to the other party or
the time and place at which the witness is to be examined. This latter
process cannot be used for taking testimony outside of the State.
Depositions may be taken within or without the state, without com­
mission, before a notary public or any officer authorized to issue
attachments. If within the state or if taken without the state, before
any officer of the state or county where taken, authorized by laws of
Georgia to attest deeds or take acknowledgments, upon 10 days'
notice to opposite party. In taking answers to interrogatories,
which must be authorized by a commission issued for such purpose
by the court here, two commissioners must act. Commissioners must
be disinterested and not related to either party, or connected with
the case: attorneys of the parties are incompetent. None of the parties
to the case, nor their agents or attorneys, can be present when the
commission is executed. The witness can only write his answer in
the presence of the commissioners. It is usual, and the better practice,
for one of the commissioners to write the answers of the witness as
they are given. Depositions may be written with the typewriter,
and commissioners may adjourn their sittings from day to day. The
following instructions for taking testimony are important: Instruc­
tions for taking answers to interrogatories: x. insert the commis­
sioners’ names in the commission: any two respectable citizens will
do. 2. State the case as you find it. Then comes the caption, thus:
State of..............................
(Here insert the county and State
County of..............................ss. where the commission is executed.)
By virtue of a commission from the.....................court of......................
county, we have caused the person in said commission named to come
before us, who being duly sworn true answers to make to certain
Interrogatories thereto annexed, deposeth and answereth as follows:
(Here insert answers of the witnesses to each interrogatory in order
3. Let the witness sign the answers; then say: "Answered, sworn to.
and subscribed before us, this. . . .day of.................... 19. ... ” Then
sign your own names, adding the words "Commissioner (L. S.) ” after
each name. 4. Seal all up together, using two wafers, each com­
missioner writing his name with "Commissioner" across a wafer or
seal. 5. State the case on the package, and address it to the clerk
of the court issuing the commission. 6. If it is to go by mail, get
the postmaster to receipt on the package. “Received from one of
the commissioners (giving his name) the within interrogatories, to be
forwarded by due course of mail,” naming his post-office. Testimony
thus taken must be sent by mail, or by some person specially author­
ized by the commissioner to carry it to the court.
Descent and Distribution of Property. The husband Is the
sole heir to his intestate wife, unless she leave children, and in that
event the husband and children shall inherit per capita, but the
descendants of children shall take per stirpe. If a man die without
children, or the descendants of children, leaving a wife, the wife is
his sole heir. If there are children, or those representing deceased
children, the wife shall take a child’s part, unless the shares exceed
five in number, in which case the wife shall have one-fifth part of the
estate. If the wife elects to take her dower, she has no further interest
in the estate. Children stand in the first degree to the intestate, and
inherit equally. Posthumous children stand upon the same footing
with other children. Lineal descendants of children stand in the
place of their deceased parents, and take per stirpe, and not per
capita. Brothers and sisters stand in the second degree and inherit
if there be no widow or children, or representatives of children. The
half-blood on the paternal side inherit equally with the whole blood.
The father' If living, inherits equally with brothers and sisters, and
stands in the same degree. If there be no father, and the mother
Is alive, she shall inherit in the same manner as the father would.
Real estate descends direct to the heirs, and personal estate to the
administrator. But real estate is subject to administration for the
purpose of paying debts, and if necessary, for distribution.
Dower. In this State the wife is entitled to an estate for life in onethird of all lands of which the husband dies seized or possessed at the
time of his death, or to which the husband obtained title in right of
his wife. There is no necessity for renunciation of dower in this State,
and a married woman, on that question, need not join with her hus­
band in conveying land, except In cases where, before 1866, he obtained
real estate belonging to his wife, by virtue of the marital relation.
Executions. Must follow the judgment or decree from which they
issue. They are good for seven years and may be renewed for a like
period by entry nulla bona.
Exemptions and Homesteads. Under the constitution and laws
of Georgia, each head of a family or guardian, or trustee of a family
of minor children, or of an aged or infirm person, or a person having
care and support of dependent females of any age, who is not the
head of a family, shall have exemption of realty, or personalty, or
both, to the aggregate of $1600. The debtor shall have power to waive
or renounce, in writing, his right to the benefit of exemption above
stated, except as to wearing apparel and not exceeding *300 worth
of household and kitchen furniture, and provisions. The homestead
or exemption may be sold by the debtor and his wife, if any, with the
sanction of the judge of the superior court of the county where the
debtor resides, or the land is situated. The proceeds to be re-invested
upon the same uses. A general waiver in writing, of the homestead,
or exemption, is good.
Foreign Corporations. All corporations, except those chartered
and organized under the laws of this State, are held to be foreign
corporations. Such corporations are recognized by comity only;
they are subject to attachment, but have all the rights of replevy and
defense. They cannot exercise any corporate powers or privileges
which by the constitution and laws of Georgia are denied to domestic
corporations or the exercise of which would be contrary to the public
policy of this State. There is otherwise no restriction upon foreign
corporations except in the case of insurance companies and building
and loan associations, which are required to make deposits. All cor­
porations are subject to license fees for doing business and all are liable
for taxes on property owned or held in the State’ (See Corporations.)
Fraud. Contracts, awards, marriages, judgments, sales, and wills
are void when they are brought about and procured by fraud. Prom­
issory notes when procured by fraud are void in the hands of the holder,
who so procures them. The statute of frauds, as of force in Georgia,
requires the following obligations to be in writing, signed by the party,
or his authorized agent, to be binding: 1. A promise by an executor,
administrator, guardian, or trustee, to answer in damages out of his
own estate. 2. A promise to answer for the debt, default, or mis­
carriage of another. 3. An agreement made upon consideration of
marriage, except marriage articles as otherwise provided. 4. Any
contract for the sale of lands, or any interest in or concerning them.
5. Any agreement that is not to be performed in a year. 6. A
promise to revive a debt barred by statute of limitations or bankruptcy.


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7. Any contract for the sale of goods, wares, and merchandise.
In existence or not in esse, to the amount of $50 or more, except the
buyer shall accept part of the goods sold and actually receive the same
or give something in earnest to bind the bargain or in part payment.
8. An acceptance of a bill of exchange.
Garnishments. This process may be invoked in any case. Gar­
nishment may be dissolved by giving bond and a third party may
claim a fund held up under garnishment and may release the fund by
giving bond. Any person may claim exemption from garnishment as
to wages to the extent of $1.25 per day and one-half of the remainder.
Holidays. January 1st (New Year’s Day), January 19th (Lee’s
Birthday), February 22nd (Washington’s Birthday), April 26th
(Memorial Day), June 3rd (Jefferson Davis’ Birthday), July 4th
(Independence Day), First Monday in September (Labor Day).
December 25th (Christmas Day), Thanksgiving Day.
Interest. The legal rate of interest in Georgia is 7 per cent, but 8
per cent is legal when contracted for in writing. Parties charging
usury forfeit the excess if usury is set up. Usury has no present
penalty in Georgia, except forfeiture of all interest paid upon the debt.
Judgments create liens from their rendition upon the real or per­
sonal property of the defendant; all judgments at the same term rank
equally, and property sold by a debtor after judgment is obtained
against him is only discharged from the lien of such judgment, if real
estate, after four years’ possession by the vendee, and in cases of per­
sonal property, after two years’. Judgments, whether in the United
States court, or in any State court, obtained in any other county than
that in which the defendant resides have no lien on the property of
the defendant in any other county, unless the execution thereon is
recorded in the county of the defendant’s residence. Unless such
execution is recorded as so required within thirty days, its lien will
only date from the time of record. (See Actions.)
Jurisdiction. (See Title Courts.)
License. No license is required of commercial travelers. Itinerant
traders must pay license fees.
Liens. Under the laws of Georgia mechanics, material-men, ma­
chinists, employes of steamboats, millwrights, builders of gold mine
machines, stone-cutters, and marble works laborers have special liens
on property improved or worked on. Landlords have a general lien
which takes effect from the levy of distress and a special lien on crops
for rent of land on which they are raised. Common law liens of inn­
keepers. factors, pawnees, carriers, attorneys and others are recog­
nized. Vendor’s lien on land has been abolished. Attorneys have a
special lien on papers in their hands and on property recovered in suits
brought by them or successfully defended by them.
Limitations. Suits on open accounts are barred after four years,
on promissory notes and bills after six years, on instruments under
seal after twenty years, on suits for personal injury after two years.
Seven years’ adverse possession of real estate under color of title, and
twenty years’ adverse possession without color of title, will bar the
claims of all persons not laboring under disability. Infants have seven
years to assert their rights, after becoming twenty-one years of age.
This State does not require that notes or contracts under seal be
witnessed, so that a note or contract under seal whether witnessed
or not carries the twenty-year statute of limitation provision.
Married Women. The wife may contract and sue and be sued in
her own name in respect to her separate estate as a femme sole, except
that she can not bind her separate estate by suretyship for any one,
and any promise to pay her husband's debt is void. She cannot
sell to her husband or trustee for any purpose, except by order of the
superior court. A wife or her heirs may sue and recover from any
person money or property used by her husband to pay his debt where
the creditor takes with notice. All the property of the wife at the
time of marriage, and all she may acquire by gift, inheritance, or pur­
chase, shall vest in and belong to her, and shall not be liable for the
debt, default, or contract of her husband. The wife with her children.
If any, is entitled to twelve months’ support out of the estate of her
deceased husband. The husband is bound to support and maintain
the wife, and his consent is presumed to her agency in the purchase of
necessaries. The wife’s separate property is not liable for debts con­
tracted by her as agent of her husband in the ordinary support of her­
self and children, but by special contract in her own capacity, and
not as agent for her husband, she could bind her separate estate, for
that purpose. A married woman can dispose of her property by will.
Mortgages. Mortgages are only security for debts. They may
embrace property in the mortgagor’s possession, or to which he has
a right of possession. They may cover a stock in bulk, but changing
In specifics, and after acquiring property. No particular form is
necessary, but it must be cleared that the instrument indicates a lien,
describes the property and specifies the debt it secures. Mortgages
on land are not good against dower, and a wife cannot waive her
dower as against this lien. Mortgages must be executed and attested
In the same manner as deeds, except that in mortgages on personal
property, only the official witness is necessary. Mortgages with power
of sale are valid in Georgia. Homestead and exemption may be
waived in the mortgage. All mortgages on personal property must
be recorded in the county where the mortgagor resides and the prop­
erty is located. Mortgages on land must be recorded in the county
where the land is situated.
Notaries. Commercial notaries, male or female, are appointed
for four years by the superior courts, and for the state at large by the
State Librarian. They must have seals and are authorized to attest
deeds and mortgages, and make protest of commercial paper.
Notes and Bills of Exchange. (See Bills of Lading and Promis­
sory Notes.) Promissory notes are negotiable by endorsement of
payee, or holder, notes payable to bearer are transferable by delivery
only. Bonds, specialties, contracts, bills of lading, and warehouse
receipts, are negotiable by endorsement or written assignment in the
same manner as bills of exchange and promissory notes. Endorse­
ments may be limited by express restrictions. Acceptances of bills
must be in writing. Transferers of negotiable instruments warrant
that they are the lawful holders, have the right to sell, that the
instrument is genuine and that prior parties had capacity to contract.
Bona fide purchasers of negotiable paper asking the same for value
before due, and without notice are protected against any defense,
except: 1. Non est factum. 2. Gambling, or immoral or illegal
consideration. 3. Fraud in its procurement by the holder. Maturity
gives notice of dishonor to transferee after maturity. No days of
grace are allowed. Any draft, bill of exchange or check, drawn upon
an institution or person with which the drawer has not sufficient
funds on deposit to meet same, subjects the drawer to criminal
liability.
Probate Law. (See Administration or Estates, Deeds and Mort­
gages.)
Protests. (See Bills of Lading and Promissory Notes.)
Records. (See Deeds and Mortgages.)
Redemption. There is no redemption in this State under judicial
sales except in case of sale of property under tax execution where
parties may redeem in twelve months if improved land and wild land
within two years.
Replevy. All property seized under attachment, distress, or other
similar process, may be replevied. Property seized under process
and claimed by the third party may be delivered over upon bond and
security for its forthcoming to answer final judgment of decree.
Revision. (See Courts.)
Sales. Sales may be made to pay debts, but any sale of stocks of
goods in bulk is deemed fraudulent unless the seller delivers to the
buyer a list of all creditors and the amount due each. It shall then be
the duty of the buyer to notify the creditors of his purchase. This
notice must be mailed five days before completion of the purchase.

BANKING AND COMMERCIAL LAWS—IDAHO
Taxes. Taxes are a lien upon all the property of the debtor, real
or personal, and its lien is preferred as stated in section herein relating
to distribution of the estates. Sales of property for taxes are con­
ducted in the same manner as other judicial sales. One year in which
to redeem is allowed.
Wills. All persons of full age and sound and disposing memory.
Including married women, may make wills, and dispose of their estates.
Wills must be executed in the presence of three witnesses, all of whom
shall be present, must be called by the testator as witnesses, and must
sign, and shall certify that they signed, in the presence of the testator,
and in the presence of each other. Wills must be in writing, except
nuncupative wills. Wills of citizens of other States, where executed
according to the laws of the State, and probated in solemn form in
such State, which dispose of real or personal property in Georgia, may
be admitted to probate in this State, when an exemplified copy of
the will is presented. Wills are probated In the court of ordinary
In the county where the testator resides at the date of his death. All
wills executed out of this State by citizens of this State to dispose
of property in Georgia must be executed according to our law. A
foreign will, executed according to the law of Georgia, will constitute
a muniment of title to real property without being probated in this
State, when recorded on the record of deeds in the county where the
land lies, together with an exemplification of record admitting it to
probate in another State, certified according to the Act of Congress.

SYNOPSIS OF

THE LAWS OF IDAHO
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Richards & Haga, Attorneys at Law, Boise. (See Card
in Attorneys' List.)
Acknowledgments. All conveyances and other instruments
required to be acknowledged In this State must be acknowledged, if
within the State, before a judge or clerk of a court of record, or the
Secretary of State, as county recorder, a notary public, or a justice
of the peace. The authority of a justice or clerk of the Supreme
Court, or Notary Public, or the Secretary of State, to take acknowl­
edgments extends to any place within the state, and of the remaining
officers authorized to take acknowledgments to the city, county or
district for which said officer was elected or appointed. If without the
State, but within the United States, they must be acknowledged before
any such officer, or a commissioner of deeds for this State, or before
any officer authorized by the laws of this State or Territory to take
such acknowledgment. If without the United States, they must be
acknowledged before a minister or charge d’afifairs of the United
States, resident and accredited in the country where the acknowledg­
ment is taken, before a consul or vice-consul, a judge of a court of
record, a duly appointed commissioner, or a notary public. The
certificate of acknowledgment, if made before a justice of the peace,
when used in any county other than that in which he resides, must
be accompanied by a certificate, under the hand and seal of the recorder
of the county in which the justice resides, setting forth that such
justice, at the time of taking such acknowledgment, was authorized
to take the same, and that the recorder is acquainted with his hand­
writing, and believes that the signature is genuine. Proof of the
execution of an instrument may be made though it has not been
acknowledged. Form of married woman’s acknowledgment the
same as that of a single person. The forms of certificates of acknowl­
edgment by trustees, executors, administrators, guardians, sheriffs,
receivers, and other officials, and of partnerships, and of the state, and
of any county or subdivision, are prescribed by Laws, 1929, Chapter
183. (See Conveyances.)
Actions. There is but one form of civil action in this State. An
action Is commenced within the meaning of the statute when the
complaint is filed with the clerk. Every action must be prosecuted
in the name of the real party in interest.
Affidavits are used only to verify pleadings, to prove service of
summons, notice, or other paper, to obtain provisional remedy.
Aliens. Anti-Alien bill prohibits aliens not eligible to citizenship
and corporations, a majority of whose members are such aliens, from
acquiring or holding real estate except to the extent and for the pur­
poses prescribed by existing treaties between their countries and the
United States, but permits such aliens to lease lands for not more
than five years for agricultural purposes. Also prohibits such aliens
from acting as guardian or trustee for any real estate and provides
that lands hereafter conveyed to such aliens shall escheat to the State.
(Law 1923, p. 160.)
Arbitration. Persons capable of contracting may submit to
arbitration any controversy which might be the subject of a civil
action between them, except a question of title to real property in
fee or for life.
Arrests. The defendant may be arrested in a case for the recovery
of money or damages on a cause of action arising upon a contract,
express or implied, when the defendant is about to depart from the
State with intent to defraud his creditors; also for money or property
embezzled or fraudulently misplaced by a public officer or any person
in a fiduciary capacity, or when the defendant has been guilty of
fraud in contracting the debt, or in concealing or disposing of personal
property, for the taking or conversion of which the action is brought;
or when the defendant has or is about to remove or dispose of his
property with Intent to defraud his creditors.
Assignment for Benefit of Creditors. No assignment for benefit
of creditors shall be valid unless made to a bona-fide resident of this
state or to a corporation duly authorized to do business in this state.
(Laws, 1927. Chap. 209., P. 293.)
Attachments. Attachments may be had in actions on judgments
or contracts express or implied where defendant is a non-resident or
the debt is unsecured. Plaintiff at the time of issuing the summons
or any time afterwards may obtain the attachment upon filing affi­
davit and undertaking and notice of attachment must be published.
Bank Collection Code. Given directly following laws.
Banks and Banking. Idaho has a full and complete law upon
the formation and regulation of banks and the formation of banking
corporations. No banking corporation can have less than five
directors. All banks, other than national banks, are under the super­
vision of the Commissioner of Finance. The banker has a general
lien, dependent upon possession, upon all property in his hands belong­
ing to a customer for the balance due him from such customer in the
course of the business. (Laws 1925, pp. 190-235). (Laws 1927,
Chap. 37. P. 49; Chap. 38, P. 50; Chap. 84, P. 102.) (Laws 1929,
Chap. 24, P. 24; Chap. 54, Pp. 73, 74; Chap. 192, Pp. 353, 354, 355;
Chap. 193, Pp. 357, 358, 360, 361; Chap. 237, P. 460: Chap. 243,
P.489; Chap. 252, P. 512; Chap. 2S0, P. 671.) As to the liability of
banks on checks and as to the duties of banks in the collection and
payment of checks and other instruments and in endorsing items
and checks deposited with them, see Chap. 60, 1931 Sess. Laws, p. 98.
Bills of Lading. Uniform act recommended by the American
Bar Association.
Blue Sky Law. Idaho has a blue sky law governing corporations,
unincorporated associations and partnerships, domestic or foreign,
dealing in stocks, bonds, and other securities, excepting United States
bonds. State or municipal securities in Idaho, and Idaho real estate
mortgages. This law requires the filing of various statements,
accounts and other papers, and makes it unlawful to do business in
the State without compliance. Securities issued or guaranteed by
the United States, or any territory or possession thereof, or by any
state, or by any foreign government with which the United States
is maintaining diplomatic relations, securities issued by cooperative
associations organized under the laws of Idaho, securities issued or


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2161

guaranteed by public service utilities, securities appearing in lists on
New York Curb, New York, Boston, San Francisco and Chicago
Stock Exchanges, or other recognized exchanges which have been
approved by the Commissioner of Finance, securities issued by or
representing interest in, or a direct obligation of, a bank, trust com­
pany, or savings institution, or issued by a federal land bank or joint
land bank or national farm loan association, or by any company
created and acting as an intrumentality of the government of the
United States, any security other than common stock outstanding in
the hands of the public for a period of not less than five years, upon
which there has been no default in the payment of principal, interest
or dividends for a continuous immediately preceding period of five
years, securities evidencing indebtedness under any contract made
pursuant to the provisions of any statute of any State of the United
States providing for the sale of personal property under conditional
sales contracts, and conditional sales contracts and promissory notes
in the ordinary course of business, are exempt from the operation of
the Blue Sky Law. The provisions of the Blue Sky Law do not
apply to persons or corporations engaged in actual mining operations,
developing mining property within the State, except that mining
corporations must make an annual report. The provisions of the
Act do not apply to any judicial sale, or to a sale by a pledgeholder,
a bona fide sale by an owner who is not the issuer or underwriter of
a security who sells the same for his own account, nor to transfers or
exchanges by one corporation to another corporation in the course
of a merger, nor to the bona fide sale of membership certificates by
established enterprises actually engaged in business in this State where
no compensation, fees or commissions are paid. Administration of
Blue Sky Law by Dept, of Finance. (Compiled Statutes 1919, secs.
5305-5324, Laws 1921, pp. 29, 297, 375; Laws 1923, p. 125; Laws
1925, p. 172, 286.) Appeal is allowed from ruling of Commissioner
of Finance to District Court, Ada County. (Laws, 1927, Chap.
234, p. 348.)
Collaterals. No statutory regulation.
Collections. Uniform Bank Collection Code as recommended by
American Bankers Association, see page 2333
Community Property. All property acquired after marriage
other than by gift, bequest, devise, or descent, is community property.
The personal earnings of the wife and the income from her separate
property are community property unless she is living apart from her
husband.
Contracts. A written instrument is presumptive evidence of a
consideration.
Conveyances. Real estate is conveyed by instrument in writing,
subscribed by the party or his authorized agent in writing. The
community property can be conveyed or incumbered only by husband
and wife joining in the execution and acknowledgment of the instru­
ment. During the continuance of the marriage the wife has the
management, control, and absolute power of disposition of her separate
property, and may bargain, sell, and convey her real and personal
property, and may enter into any contract with reference to the same,
in the same manner and to the same extent and with like effect as a
married man may in relation to his real and personal property.
Separate property of wife not liable for debts of her husband, wife is
not liable as surety unless the obligation is for her benefit or benefit
of her separate property. An instrument purporting to grant real
property to take effect upon condition precedent, does not pass the
estate upon the performance of the condition. Such instrument is
merely an executory contract. (See Acknowledgments.)
Corporations. Private corporations may be formed by three or
more natural persons of full age, at least two-thirds of whom are
citizens of the United States. Such corporations are formed by
execui ng articles of incorporation signed in triplicate by each of
the incorporators and acknowledged by at least three of them before
an officer authorized to take acknowledgments, and in addition to
stating the name of the corporation, shall state in the English language:
1. Its purpose. 2. Its duration. 3. Location and post-office address
of its registered office in this state. 4. Total authorized number of
par value shares and their aggregate par value, and if any of its
shares have no par value, the authorized number of such shares.
5. Description of the classes of shares, if shares are to be classified,
and a statement of the number of shares in each class and the relative
rights, voting power, preferences and restrictions granted to or imposed
upon the shares of each class. 6. The name and post-office address
of each of the incorporators and a statement of the number of shares
subscribed by each, which shall not be less than one, and the class of
shares for which each subscribes. Triplicate originals of the articles
of incorporation shall be delivered to the Secretary of State, and if
he finds that they conform to law he shall put an endorsement of his
approval on each set and when all taxes, fees and charges have been
paid as required by law, he shall file one of such sets in his office and
record the same and shall issue and record a certificate of incorpora­
tion. One of the sets of articles of incorporation shall then be filed
for record in the office of the County Recorder of the County in which
the registered office of the corporation is situated, and the other shall
be retained by the corporation. The articles may provide for the
election of one-third of its directors annually. Railroad, wagon road,
telegraph and telephone corporations must state also in their articles;
1. The kind of road, telegraph or telephone line intended to be con­
structed. 2. The estimated length of the road or line. 3. They may
provide in their articles the number of directors which shall constitute
a quorum for the transaction of business, the decision of the majority
of such quorum to be a valid act. 4. Whether meetings of the board
shall be held within or without the State. 5. Whether stockholders
shall be individually liable for debts of corporation. Railroad corpo­
rations must have subscribed, before filing articles, $1,000 per mile;
wagon road corporations, $300 per mile; telegraph corporations, $100
per mile, and the articles must be verified by affidavit of president,
secretary, or treasurer named in articles, that such stock has been
subscribed. All corporations, except insurance, non-production min­
ing companies, co-operative telephone and irrigation companies, must
pay between July 1 and September 1 of each year, a license fee based
on the amount of authorized capital stock, varying from $10 to
$150; a failure to make payment by September 1 entails a penalty
of $10, and a failure to make payment by November 30 entails a
loss of charter for domestic corporations and a loss of the right to do
business within the State for foreign corporations. Between July 1
and September 1, all corporations must make an annual report.
Corporations may be reinstated by paying all license taxes that have
accrued and a penalty of $10 for each year they have failed to file
their annual statement or failed to pay their annual license fee
Chapter 262, Laws 1929, p. 545, styled the “Business Corporation
Act,” follows very closely the Uniform Business Corporation Act
drafted by the National Conference of Commissioners on Uniform
Laws.
Corporation, Foreign. Foreign corporations desiring to do busi­
ness in this State, may have all the rights and privileges of like domes­
tic corporations, by filing with the secretary of state, a certified copy
of the articles of incorporation, and in the office of the county recorder
of the county where the principal place of business of such corporation
is to be conducted, a copy of their articles of incorporation duly certified
by the secretary of state of this State, and the designation of some per­
son residing in the county in which such principal place of business is
to be located upon whom process issued by authority of or under any
law of this State may be served. The original designation of agent
must be filed with the secretary of state and a copy certified by the
secretary of state must be filed in the office of the County Recorder
in which its principal place of business is located in this State.
Courts. Terms and Jurisdiction. The judge of the district court
of each of the judicial districts of the State must annually fix the
time for holding the district court in the several counties of his dis­
trict; and he may hold such special terms as he deems proper and
necessary. District courts have original jurisdiction in all civil cases.
Probate courts are held in each county continuously, and have juris­
diction up to $500, in civil cases and concurrent jurisdiction with
justice's courts in all criminal cases. Justices’ jurisdiction, $300

2162

BANKING AND COMMERCIAL LAWS—IDAHO

Curtesy does not exist.
Days of Grace abolished by statute.
Depositions may be taken before any judge, justice of the peace,
notary public, or commissioner appointed by the Court, upon notice
served upon the opposite party, stating the court, action, time, and
place, and before whom the same will be taken, or they may be taken
upon commission issued by the judge with interrogatories attached.
Depositions shall not be taken before any person or the kin of any
person interested in the action.
Descent and Distribution of Intestate Estates. If a person
dies intestate, surviving spouse takes all the community property,
both real and personal.
On death intestate separate property, both real and personal,
descends as follows: If decedent leaves spouse and one child, each
entitled to one-half of decedent's separate property: if more than
one child, surviving spouse gets one-third and remainder goes in
equal shares to children of decedent and to the lawful issue of any
deceased child by right of representation, but if no children of decedent
living at his death, remainder goes to all of his lineal descendants,
and if they are in same degree equally, otherwise according to right
of representation: if decedent leaves no surviving spouse but leaves
issue, the whole estate goes to such issue or their descendants if
deceased; if decedent leaves no issue, one-half goes to surviving
spouse and other half to decedent's father and mother in equal shares,
or if either be dead, the whole goes to the other; if no issue nor hus­
band or wife, estate goes to father and mother; if neither issue, hus­
band. wife, father nor mother, iD equal shares to brothers and sisters
of decedent and to their children by right of representation; if spouse
survives decedent and there are neither issue, father nor mother,
whole estate goes to such spouse; if decedent leaves neither issue,
husband, wife, father, mother, brother, nor sister, estate goes to next
of kin in equal degree, computed according to rules of civil law; if
decedent leaves no heirs, property escheats to State. When any
estate is devised or bequeathed to any child or other relative of the
testator and the devisee or legatee dies before the testator, leaving
lineal descendants, such descendants take the astate so given by the
will in the same manner as the devisee or legatee would have done
had he survived the testator.
Dower does not exist. (See Curtesy and Community property).
Employers and Employes. All persons employing mechanics or
laborers in working mines, erectirig or repairing buildings, construct­
ing canals, railroads, etc., must make, record, and publish a state­
ment, under oath, setting forth the following: The name of the
owner of the premises where work is being done or upon which it is
Intended to begin work; the name of the person or company engaged
in or who contemplates engaging in work upon such premises; the
conditions under which such person or corporation is prosecuting
the work as agent, owner, etc., the principal office of the owner and
the agent in this State; the time and place where payment of laborers
and mechanics will be made. A copy of the statement must be
posted at the place where work is prosecuted.
Employer’s Liability Law. (See Workmen's Compensation.)
Executions issue at any time within five years after judgment.
The only stay is by appeal, with supersedeas bond. One year allowed
for redemption from execution and foreclosure sale.
Exemptions. Homestead, not exceeding $5,000, if declaration
of homestead is duly acknowledged and recorded; office furniture
and library, $200; necessary household and kitchen furniture not
exceeding in value $300, and provisions for family for six months;
certain farm animals, etc., with food for six months; and water
right of 160 inches, when actually used in irrigation; also crops grow­
ing or grown on fifty acres of laud, leased, owned or possessed by
person cultivating the same; tools or implements of mechanic neces­
sary for his trade of the value of $500; all instruments of surgeons,
etc., also all professional libraries; miner's dwelling of value $500, and
his pipes, cars, etc., of the value of $200; pack animals and equip­
ments, not exceeding $2.50; team, wagon, etc., of drayman; seventyfive per cent of the personal earnings of a debtor within thirty days
receding levy, where earnings are necessary for use of family, residig in this State; the shares held by members of a Building and Loan
Association to the value of $1,000; provided, such person has no
homestead; all benefits arising out of life insurance, represented by
an annual premium of $250; all property of fire companies. All the
above property may be sold under foreclosure of mortgage, which
Includes same or execution issued on judgment for purchase price.
Garnishment. Any personal property or credits in the hands of
another, belonging to the defendant, is subject to garnishment, as
are debts owing to him from another if due.
Guaranty, Title and Trust Co. May furnish abstracts, act as
surety, trustee, fiscal agent. Paid up capital of $25,000 required.
Capital deemed security for the performance of their duties. Addi­
tional powers of trust companies, see Chap. 189, Laws 1929, p. 355.
Holidays. January 1st, February 22nd, May 30th, June 15th,
’ioneer Day), Fourth of July, first Monday in September (Labor
ay), October 12th, November 11th, Thanksgiving Day, Christmas,
Sundays and any day on which a general election is held.
Husband and Wife. All the property of the wife owned by her
before marriage, and that acquired afterwards by gift, bequest, or
descent or that which she shall acauire with the proceeds of her
separate property, shall remain her sole and separate property, to
the same extent and with the same effect as the property of a hus­
band similarly acquired. The wife has the management, control, and
absolute power of disposition of her separate property, to the same
extent and with like effect, as a married man may have in relation
to his real and personal property. The separate property of the
wife is not liable for the debts of her husband, but is liable for her
own debts contracted before or after marriage. There is no estate
by courtesy or in dower. Marriage settlements are provided for,
and when properly executed and recorded may vary the statute
governing the relations of husband and wife concerning property
rights. Minors may execute valid marriage settlements
Interest. Where there is no express contract in writing fixing a
definite rate of interest, the rate is 7 per cent per annum. Parties
may agree in writing for interest at a rate not to exceed 10 per cent per
annum. Judgments bear interest at the rate of 7 per cent per annum.
Compound interest allowed if aggregate does not exceed 10 per cent
on principal.
Judgments are liens on all real estate of debtor within the county,
from time of docketing, and may be extended to other counties by
filing transcript in recorder’s office. Lien continues five years.
Justice's court judgments become liens when certified and recorded.
May be revived by issuing execution within limitation. Chap. 51,
Laws 1929, p. 70, provides for filing transcript of judgment of U. S.
Court with Clerk of District Court in any county in the State in order
to make it a lien on real property.
Liens, Mechanics’. Every person performing labqr upon or fur­
nishing materials used in the construction or repair of any mining
claim, building, or other improvement, has a lien thereon. Farm
laborers have lien upon the crop and products thereof, upon which
they bestow labor. All liens must be set forth by a statement in
writing, showing the amount due. the facts connected with the matter,
that there are no credits due on the claim, or offsets against the
same; which statement must be verified by the claimant, and recorded
in the office of the county recorder, if on claim of original contractor,
within ninety days, if on claim of other persons, within sixty days
from the time of the completion of the structure the completion of the
labor, or the furnishing of the materials. Lien mast be enforced by
suit within six months, unless credit is given, expires at all events
In two years.
Limitation for Suits. Judgments six years; written contracts
or for real property, five years; contracts or obligations not founded
on writing including open accounts, four years; trespass, trover
replevin and fraud, three years; personal injuries, two years; other
relief, four years. Revivor: by acknowledgment of debt in writing
or part payment of principal or interest. Action against a director or

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a shareholder of a corporation for illegal dividend must be brought
within two years from the date of payment. Chap. 262, Laws 1929,
p. 562.
Married Women. All property, real or personal, acquired before
marriage and acquired after marriage, by gift, bequest, devise, or
descent, are the wife's separate property; all other property acquired
after marriage, common property; wife must record inventory of
separate personal property. No estate as tenant by courtesy allowed
the husband nor dower to the wife.
Mines and Mining. (Principal regulations under United States
Statutes.) Quartz locations may be 1,500 feet long and 300 feet on
each side of the middle of lode. Monuments must be established at
all exterior angles of claim. Claim should be tied to some natural
or permanent monument. Copy of location notice must be posted
at discovery within three days after discovery. Notice of location
must be recorded within ninety days after location; within sixty days
ten-foot shaft must be sunk or its equivalent. Location notice mast
contain name of locator, name of claim, date of discovery, dimensions,
distance from some permanent, natural, or artificial object; name of
mining district, county, and state. Placer locations made in same
manner as quartz locations, except that within fifteen days after
making location, locator must excavate not less than 100 cubic feet
for purpose of prospecting claim, and must record notice of location
within thirty days after making location. Official patent survey of
lode or placer claim by U. S. Mineral Surveyor is labor performed
upon and for the benefit of, said claim. Chap. 194, Laws 1929, p. 362.
Mortgages. A real estate mortgage must be acknowledged and
certified, and recorded in like manner as conveyances and deeds
of real property, and is foreclosed by action in the district court.
Chattel Mortgages must be acknowledged as real estate mortgages
and sworn to by the mortgagor that the same is made in good faith
without any design to hinder, delay, or defraud creditors. Must be
filed and a minute record made by recorder, unless mortgagee has
possession. Survives as long as the debt. Mortgages are discharged
by a satisfaction duly executed and recorded, or by entry on margin of
the record, witnessed by recorder. Lien of mortgage expires on real
property after expiration of ten years from maturity of the obligation
secured. Chap. 56, Laws 1929, p. 83.
Negotiable Instruments. Negotiable instruments are governed
by the rules of the Uniform Negotiable Instrument Law, as recom­
mended by the American Bar Association. (See Laws 1903, p. 380.)
Notaries, when requested, to demand acceptance and payment
of foreign, domestic, and inland bills of exchange or promissory
notes and protest the same for non-acceptance and non-payment;
exercise such other powers and duties as by the law of nations and
commercial usage, or by the laws of any other Territory, State, govern­
ment, or country may be performed by notaries. Attach acknowl­
edgments or proof of powers of attorney; mortgages, deeds, grants,
transfers, and other instruments of writing executed by any person.
Give certificate of such proof or acknowledgment, to take depositions,
affidavits, and administer oaths and affirmations in all matters incident
to duties of the office. To keep a record of all official acts; when
requested, and upon payment of his fees therefore, to make and give
a certified copy of any record in his office; to provide and keep an
official seal, on which must be engraved his name, the words “Notary
Public," and “ State of Idaho. To authenticate with his official
seal all official acts. The commission is good throughout the State.
Power of Attorney. Powers of attorney for grants of real estate
and to execute a mortgage mast be in writing, subscribed, acknowl­
edged or proved, certified and recorded as other instruments affecting
real property. Powers of attorney which have been recorded must
be revoked by revocation in writing, acknowledged, proved, certified,
and recorded the same as original power.
Probate Law. Probate courts have jurisdiction to open and
receive proof of wills and admit them to proof; to grant letters testa­
mentary and guardianship and revoke same; appoint appraisers of
estates, compel executors, etc., to render accounts; order sale of prop­
erty of estates and minors; order payment of debts due from estates,
order and regulate distribution of property or estates; compel attend­
ance of witnesses and production of all instruments pertaining to
estates and property of minors, and make such orders as may be neces­
sary to exercise all powers conferred. Proceedings of this court are
construed the same as courts of general jurisdiction and like force given
to its records.
Protest. (See Notaries.)
Records. All deeds, mortgages, real and chattel, and instruments
affecting the title to lands must be recorded. Inventory of the
separate personal estate of a married woman when recorded, becomes
prima facie evidence that the property therein enumerated is her
separate property. In case of levy of attachment upon real estate, a
copy of the writ, with a copy of the notice of levy attached thereto,
mast be filed in the office of the county recorder.
Redemption. Property may be redeemed within one year after
sale, on paying purchaser amount paid on sale and 10 per cent addi­
tional. Property may be redeemed by successive redemptioners
within sixty days from last redemption, and within one year from
sale, by paying an additional .4 per cent. In cases of tax sales, the
owner may redeem in four years
Replevin. Action of, must be brought within three years from time
It accrues. Plaintiff may sue for the possession without claiming
immediate possession, or he may claim immediate possession at time of
commencing suit or afterward. Affidavit showing that plaintiff is the
owner, the detention, the unlawfulness of the detention, etc-. and bond
with sureties required to obtain immediate nossession. Defendant
may execute undertaking, with approved sureties, for the retention of
the property, and that it will be forthcoming, subject to the order of
the court in which the action is pending, and thereupon retain the pos­
session of the property involved.
Sales. Uniform sales Act recommended by American Bar Asso­
ciation.
Seals. The distinctions between sealed and unsealed instruments
are abolished. Written contracts presumptive evidence of con­
sideration.
Taxes. All property must be assessed with reference to Its value
at twelve o’clock noon on the second Monday of January of each
year at its full cash value, and the owner or other claimant of the
property shall have the same listed for taxation, and such taxes are
a lien from and after that date. Personal property coming into
State after second Monday in January subject to assessment with
reference to its full cash value as to the date it comes into State for
such proportion of full value as is represented by that part of the
year subsequent to its date of entry. If taxes are not paid by the
fourth Monday in December they become delinquent, but half of the
taxes may be paid before said date and the remaining half before the
fourth Monday in June without delinquency. A penalty of 2 per
cent is added on all delinquent taxes. Delinquency entries are made
as of the first Monday in January in the succeeding year by the tax
collector and have the force and effect of a sale to the county. They
bear interest at the rate of 10 percent per annum from date and are
not assignable. Redemption may be made within four years from
the date of such entry. Notice of expiration of redemption period
must be given by tax collector not less than three, nor more than five
months before such expiration in order to entitle county to deed.
Trust Companies. (See Guaranty Companies.)
Warehouse Receipts. The Uniform Warehouse Receipts Act,
recommended by the American Bar Association.
Wills. Every person over the age of eighteen years, and of sound
mind, may make a will. Every will, other than a nuncupative will,
must be in writing, and every will other than an olographic and a
nuncupative will, must be executed by the testator subscribing thereto
or some person by his direction, which must be done in the presence
of two attesting witnesses, each of whom must sign his name and
state that the testator requested him to witness the testator's signa­
ture, and the testator must also declare in the presence of the wit-

BANKING AND COMMERCIAL LAWS—ILLINOIS
nesses that such is his last will and testament. One-half of com­
munity property may be disposed of by will to the surviving spouse,
his, her, or their children, the grand-children or parents of either
spouse, or one or more of such persons, but not to exceed one-fourth
to a parent or parents of either spouse, unless limited to an estate for
life or less, and any part of the decedent's share of the community
property in excess of the unencumbered appraised value of $25,000
may be disposed of as the testator sees fit.
Workingmen’s Compensation Act. The Workmen's Compen­
sation Act of this state is based upon the Act recommended by the
National Conference of Commissioners on Uniform State Law.
(Chap. 236, Compiled Statutes, 1919, as amended.) The law pro­
vides compensation for a workman for personal injury by accident
arising out of and in the course of his employment.

SYNOPSIS OF

THE LAWS OF ILLINOIS
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Balford Quintin Shields, Attorney at Law
77 W. Washington St., Chicago.
(See Card in Attorney’s List)
Acknowledgments. Of deeds of real estate and other instruments,
may be taken before the following officers: Within this State before
a master in chancery, notary public, United States commissioner,
county clerk, justice of the peace, any court of record having a seal
or any judge, justice, clerk, or deputy clerk thereof. Without this
State, and within the United States, its territories, dependencies, or
the District of Columbia, before a justice of the peace, notary public,
master in chancery. United States commissioner, commissioner to take
acknowledgments of deeds, mayor of a city, clerk of a county, or
before any judge, justice, clerk or deputy clerk of the supreme, or
district court of the United States, or before any judge, justice, clerk
or deputy clerk, prothonotary, surrogate, or registrar of the supreme,
circuit, superior, district, county, common pleas, probate, orphans or
surrogate court of any of the States, Territories, or dependencies of
the United States. In any dependency of the United States, such
acknowledgement or proof may also be taken or made before any
commissioned officer in the military service of the United States.
When such acknowledgment or proof is made before a notary public.
United States commissioner, or commissioner of deeds, it must be
certified under his seal of office. If taken before a mayor of a city,
it must be certified under the seal of the city; if before a clerk, deputy
clerk, prothonotary, registrar, or surrogate, under the seal of his court;
if before a justice of the peace or a master in chancery, there must be
added a certificate of the proper clerk under the seal of his office
setting forth that such person was a justice of the peace or master in
chancery at the time of taking such acknowledgment or proof. An
acknowledgment or proof of execution may be made in comformity
with the laws of the State, Territory, dependency, or district where it
is made. Without the United States, before any court of any republic,
dominion, state, kingdom, empire, colony, territory, or dependency
having a seal, or before any judge, justice, or clerk thereof, or before
any mayor or chief officer of any city or town having a seal, or before
a notary public or commissioner of deeds, or any ambassador, minister
or secretary of legation, or consul of the United States, or vice-consul
deputy consul, commercial agent, or consular agent of the United
States. The acknowledgment of a conveyance by a married woman
may be made and certified as if she were single. An acknowledgment
taken by any one interested in the conveyance is void.
Actions. Forms of action and pleadings are substantially as at
common law except in justice courts and the municipal court of Chi­
cago, wherein the practice has been much simplified. A non-resident
is required to give a bond for costs.
Administration of Decedents’ Estates. Letters testamentary
Issue to executor named in will, if he be a resident. If there be no
will, or no executor named, or the executor is disqualified, or refuses
to act, administration is granted to surviving husband, or wife, next
of kin. or some competent person. The surviving husband or wife,
or the person nominated by him or her, has preference. If none of
the above named applies within sixty days from death of deceased,
then administration is granted to the public administrator of the proper
county. The administrator must be a resident of the State. A
foreign executor or administrator, within the United States, may
prosecute suits to enforce claims or to sell lands to pay debts. The
Uniform Foreign Probate Act is in force in Illinois. The executor
or administrator must file an inventory within three months from the
date of his appointment and must fix upon a term of court, within
six months from the time he qualifies, for the adjustment of claims,
and publish notice thereof. The claimant should produce and file
his verified claim, which, if not objected to, may be allowed without
further evidence. If objected to, the claim is set down for trial. If
the claim is not presented at the time fixed upon, it mav afterwards,
within one year, from the date of the issuance of letters of adminis­
tration, be filed with the clerk, whereupon a summons issues against
the executor or administrator, and the matter is heard at a subseauent
term. All claims not exhibited within one year from granting of
administration are barred, except where newly discovered assets are
found. Claims are classified as follows: 1. Funeral expenses and
cost of administration. 2. Widow’s or children’s award. 3. Expenses
of last illness, including physician’s bill, and demands due common
laborers or household servants of deceased for labor. 4. Debts due
common-school or township funds. 5. Trust funds. 6. All other
debts. Claims have priority of payment in the above order.
Affidavits. Within this State oaths and affirmations may be
administered by any judge, justice of the peace, master in chancery,
clerk of a court, police magistrate, or notary public, in their respective
Jurisdictions. Without the State the oath or affirmation may be
administered by any officer authorized by the laws of the particular
State, and if such officer has a seal, his certificate under his official
seal is received as prime facie evidence of his authority.
Aliens. The present law went into effect July 1, 1897. It does
not affect the rights of aliens as to personal property, who still take
the same as citizens. Its provisions are subject to treaties made by
the United States with foreign countries. All aliens, subject to cer­
tain restrictions mentioned in the act, may acquire and for a limited
time hold real estate situated in this State by deed, devise, or descent,
and may transfer, devise or encumber it.
Arrest and Bail. No person can be imprisoned for debt unless
upon refusal to deliver up his estate for the benefit of his creditors
In such manner as shall be prescribed by law, or in cases where there
Is a strong presumption of fraud.
Assignments. The operation of the Illinois Act relating to
voluntary assignments for the benefit of creditors has been suspended
by the national bankruptcy law.
Aviation. Persons operating aircraft within this state are required
to have a license issued by Secretary of Commerce of United States
and in conformance with act to regulate aviation.
Attachments. A creditor, resident or non-resident, whose claim
Is due, may bring attachment in a court of record if the amount
exceeds $20, and in justice court for any amount not exceeding $200,
on any of the following grounds: 1. Where the debtor is a non-resi­
dent of this State. 2. Where the debtor conceals himself, or stands
in defiance of an officer so that process can not be served upon him.
3. Where the debtor has departed from this State with the intention
of having his effects removed from this State. 4. Where the debtor
Is about to depart from this State with the intention of having his
effects removed from this State. 5. Where the debtor is about to


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2163

remove his property from this State to the injury of such creditor.
6. Where the debtor has, within two years preceding the filing of the
affidavit required, fraudulently conveyed or assigned his effects, or a
part thereof, so as to hinder or delay his creditors. 7. Where the
debtor has within two years prior to the filing of such affidavit fraudu­
lently concealed or disposed of his property so as to hinder or delay
his creditors. 8. Where the debtor is about fraudulently to conceal,
assign, or otherwise dispose of his property or effects so as to hinder
or delay his creditors. 9. Where the debt sued for was fraudulently
contracted on the part of the debtor, provided the statements of the
debtor, his agents or attorney, which constitute the fraud, shall have
been reduced to writing, and his signature attached thereto by him­
self, agent, or attorney. The creditor must give bond in double the
amount of the claim. Real estate or personal property may be
attached or funds garnished. The property or funds may be released
by the debtor giving a forthcoming bond, or entering into a recog­
nizance in court to pay the judgment.
Banks and Banking. Under the state constitution stockholders
have a double stock liability, and every bank must make, under oath,
and publish each quarter a full and accurate statement of its affairs.
An Act to revise the law in relation to banks and banking was
passed and approved June 23, 1919, and ratified by referendum at
the election of November 2, 1920. Banks may be formed under the
statute for the purpose of discount and deposit, buying and selling
exchange, and doing a general banking business, except the issuing
of bills to circulate as money; may loan on both personal and real
estate security, and may accept and execute trusts. An association
of persons, as hereinafter set forth may organize a bank by filing a
statement with the Auditor. The minimum number of persons in
such associations is fixed according to populations as follows:
Populations
No. of Persons
10,000 or less............................................................ 5
10,000 to 25,000....................................................... 10
25,000 to 50,000....................................................... 15
50,000 to 100,000..................................................... 20
Over 100.000................................................. .. ... .25
All such persons must be residents of place where Dank Is to be
established and in places exceeding 100,000 population, 20 persons of
the association must reside within 3 miles of the proposed location
of the bank.
Accompanying the application must be a statement made before
some officer authorized to acknowledge deeds giving the net financial
worth of each of the members of such associations together with at
least three references as to personal character of each individual
named therein. Whereupon the Auditor issues a permit to organize.
The shares shall be $100 each. After the permit to organize is issued
and the stock fully subscribed, the stockholders meet, fix the number
of directors and elect the directors who shall manage the corporation
for one year, or until their successors are elected. At the election of
directors, stockholders have the right of cumulative voting. The
directors elect one of their number President, appoint the necessary
Officers and employes, fix their salaries and make by-laws. Each
director shall file with the State Auditor an affidavit that he will
faithfully perform the duties of his office in accordance with law; that
he is the owner in his own right, of ten shares of the stock of the bank,
free from incumbrance. The directors must cause suitable books to
be kept and file with the Auditor a list of stockholders and a copy of
any other records the Auditor may require. Unless another day is
fixed by the by-laws of the Association, the stockholders shall meet
the first Monday in January and elect directors. Vacancies are
filled by vote of two-thirds of the directors. Each director must
own ten shares of the stock of the bank and file a certificate or certif­
icates thereof with the Cashier, to be held during his term as director.
A quorum of the directors must meet once each month. Any officer,
director or employe who shall make a false statement to any official
authorized to examine the affairs of the bank, upon conviction shall
be punished by imprisonment of not less than one or more than ten
years. When the State Auditor is satisfied on examination that the
bank has been duly organized and its stock fully paid, he issues a
certificate that the bank is authorized to commence business, which
certificate must be filed with the Recorder of Deeds of the county in
which the bank is to carry on its business.
The double liability of stockholders applies to all debts contracted
while they hold stock in the bank and is not released by an assignment
of the stock. The President or Cashier must, within thirty days after
organization file with the Recorder of Deeds, a complete list of stock­
holders and their holdings and record thereafter a certificate of all
transfers within ten days after such transfers. A statement of the
resources and liabilities of the bank must be filed with the State Auditor
when required by him. The Auditor must call for such report at least
once each three months. This report must be published in a news­
paper of the city or town where the bank is located.
The State Auditor shall appoint a suitable person, not connected
with the bank, to make a thorough examination of the affairs of each
bank once a year, and report the same to the Auditor. A bank may
hold only such real estate as may be necessary for a banking house or
such as may be acquired in the collection of debts. Real estate
acquired for debts must be disposed of within five years. No bank
may establish branches. The total liability for money borrowed oj
any person, corporation or firm (including the members of the firm)
to any banking association shall at no time exceed 15 per cent of the
capital and surplus (not including undivided profits) of such bank
and shall in no event exceed 30 per cent of the capital stock actually
paid in. Provided, however, that money borrowed within the mean­
ing of the Act shall not include (1) the discount of bills of exchange
drawn in good faith against actually existing values; (2) the discount
of commercial or business paper actually owned by the person negoti­
ating the same; (3) the purchase of, or loaning money in exchange for,
evidences of indebtedness which shall be secured by mortgage or trust
deed upon productive real estate, the value of which, exclusive of
buildings, as ascertained by the oath of two disinterested appraisers,
is double the amount of the principal debt secured; and (4) the pur­
chase of, or loaning money in exchange for, evidences of indebtedness
secured by a written pledge covering live stock, the president, vicepresident or cashier of such bank or association certifying at the time
of such purchase or loan that the value of such live stock is double
the principal debt secured; but in no event shall the liabilities of any
such person, corporation or firm to such bank, exceed the amount
of its capital stock, or 25 per cent of its deposits. Directors are made
personally liable for any violations of this provision to the extent of
the loss occasioned thereby to the bank, its stockholders or any other
party. No loan shall be made to the President, Vice-President or
any employe of the bank until the loan shall have been approved by
the Board of Directors.
The minimum amounts provided for the capital stock of banks
are as follows. In cities, towns and villages that have not exceeding
five thousand inhabitants, $25,000; between five thousand and ten
thousand, $50,000; between ten thousand and fifty thousand, $100,000;
over fifty thousand, $200,000. Upon impairment of the capital stock
the Auditor may require assessments of stockholders or a reduction
of the capital. If he shall deem the bank is being conducted in an
unsafe, fraudulent or illegal manner, he may file a bill for an injunc­
tion dissolution and receiver, but such a bill can be maintained only
in the name of the Auditor. Upon deficiency of assets, the court
may require, in such a suit, that the receiver proceed against the
stockholders on their stock liability. There are provisions for con­
solidation, change of name and voluntary dissolution. All banking
associations heretofore organized by general or special Act, are made
subject to all the provisions of this Act.
After January 1, 1921, no natural person or natural persons, firm
or partnership shall transact the business of banking or the business
of receiving money upon deposit, or shall use the word “Bank” or
“Banker” in connection witn said business; provided, that nothing
herein contained shall be construed to prohibit banks incorporated
under the laws of this State or of the United States from appointing

2164

BANKING AND COMMERCIAL LAWS—ILLINOIS

natrfral persons as agents to receive deposits of savings in and through
the public schools. Any person violating the Act is guilty of a mis­
demeanor and is subject to a fine not exceeding $1,000, or imprison­
ment in the penitentiary for one year. A banker is liable to fine and
imprisonment if he receives a deposit after he knows the bank has
become insolvent and thereby the depositor suffers loss.
One drawing and delivering a check, draft, or order on a bank with
intent to defraud, and knowing at the time that he had not sufficient
funds in or credit with the bank to pay the check, draft or order in
full is guilty of a misdemeanor and is subject to a fine of $1,000 or
imprisonment for one year, or both. (See Negotiable Instruments.)
Bills of Lading. The Uniform Bills of Lading Law is in force in
Illinois.
Blue Sky Law went into effect June 10, 1919, governing the
sale of stocks of corporations. Securities are divided into four classes.
Certain securities can be sold only after a full statement in regard
thereto has been filed with the Secretary of State and a permit issued
The law is stringent. Copies of the law and forms for use thereunder
can be obtained by writing to the office of the Secretary of State,
Springfield. Ill The act is entitled “The Illinois Securities Law."
Chattel Mortgages. No mortgage, trust deed, or other convey­
ance of personal property having the effect of a mortgage or lien, is
valid against third persons, unless possession be delivered to, and
remain with the grantee; or the instrument provides for the possession
of the property to remain with the grantor, and the instrument is
acknowledged and recorded. The instrument must be acknowledged,
in counties having a population of less than two hundred thousand,
before a justice of the peace, police magistrate, a clerk or deputy clerk
of a municipal court, or county judge of the county in which the mort­
gagor resides; in counties having a population of 200,000, or more,
before a justice of the peace of the town or precinct, or if there be no
justice of the peace, before the clerk or deputy clerk of the municipal
court in the district where the mortgagor resides. If the mortgagor is
a non-resident of the State, the mortgage may be acknowledged before
any officer authorized bv law to take acknowledgments of deeds.
After acknowledgment and within ten days after its execution the
instrument must be filed for record with the recorder of the county
in which the mortgagor resides when the instrument is executed,
or, in case of a non-resident of the State, then in the county where
the property is situated. The mortgage is a valid lien until ninety
days after the maturity of the entire debt or obligation, not exceeding
three years from the filing of the mortgage, and may be renewed for
one year. A note secured by chattel mortgage, must state op its
face that it is so secured, otherwise the mortgage is void. A mortgage
may be released on the margin of the record, or by a release deed.
A mortgage on a stock of goods permitting mortgagor to retain
possession and buy and sell is void as to creditors.
Commercial Paper. (See Negotiable Instruments.)
Consignments. Agreements to sell on consignment are valid.
If a commission merchant, or party selling on commission, converts
the property consigned, or after demand fails to account for the pro­
ceeds, he is subject to fine and imprisonment, and liable for double
the value of the property so convertedConveyances. (See Deeds.)
Corporations. Corporations, except for charitable, educational,
penal, and reformatory purposes, may be organized only under gen­
eral laws. (Const, art. XI, 1.) In all elections of directors every
stockholder has the right to vote, in person or by proxy, for the number
of shares of stock owned by him, or may cumulate his votes. (Const,
art. XI. 13.)
A new act relating to corporations for profit, became in force
July 1, 1919. Corporations may be created under tne act for any
lawful purpose, except for banking, insurance, real estate, brokerage,
the operation of railroads, or the business of loaning money; and may
be organized also, for any one of the following purposes: (1) “building
corporations,” for acquiring, owning, erecting, leasing, or operating
only one building and the site therefor of not more than 80,000 square
feet of land; (2) “agency and loan corporations,” for the purpose of
acting as agents for others in the purchase, sale, renting, and man­
agement of real estate and leasehold interests in the operation of an
Insurance agency business, in the negotiation of loans on real estate
and leasehold interests, of lending money on bonds or notes secured
by mortgages or trust deeds on real estate or leaseholds or on the
mortgage bonds of industrial or railroad companies or of any public
service corporation, or on any State, municipal, or quasi-municipal
bonds, or for the purpose of buying, selling, pledging, mortgaging, or
otherwise dealing in any of such securities; (3) “real estate improve­
ment corporations,” for the purpose of owning land, erecting resi­
dences thereon, and selling or leasing such land or residences, which
land so owned shall be situated only in the county in which the cor­
poration's principal office is located.
Corporations under the act have the following rights, powers, and
privileges: (1) succession; (2) to sue and be sued in its corporate
name; (3) common seal .(41 capital stock, with or without a par value,
and divided into classes; (5) to acquire, and to own, possess, and
enjoy so much real and personal property as may be necessary for
the transaction of the business of such corporation, and to lease,
mortgage, pledge, sell, convey, or transfer the same; (6) to own,
purchase, or otherwise acquire, whether in exchange for the issuance
of its own stock, bonds, or other obligations or otherwise, and to
hold, vote, pledge, or dispose of the stocks, bonds, and other evi­
dences of indebtedness of any corporation, domestic or foreign;
(7) to borrow money at such rate of interest as the corporation may
determine without regard to or restrictions under any usury law of
this State and to mortgage or pledge its property, both real and
personal, to secure the payment thereof; (8) to elect officers, appoint
agents, define their duties and fix their compensations; (9) to lease,
exchange, or sell all of the corporate assets with the consent of twothirds of all of the outstanding capital stock of the corporation at
any annual meeting or any special meeting called for that purpose;
(10) to make by-laws not inconsistent with the laws of this State for
the administration of the business and interests of such corporation;
(11) to conduct business in this State, other States, the District of
Columbia, the Territories, possessions, and dependencies of the
United States and in foreign countries, and to have one or more
offices out of this State, and to hold, purchase, mortgage, and convey
real and personal property outside of this State necessary and requisite
to carry out the object of the corporation; (12) in time of war to
transact any lawful business in aid of the United States in the prose­
cution of war, to make donations to associations and organizations
aiding in war activities, and to loan money to the State or Federal
Government for war purposes; (13) to cease doing business and
to surrender its charter; (14) to have and exercise all the powers
necessary and convenient to carry into effect the purpose for which
such corporation is formed.
The right of a corporation to hold the stocks of other corporations
Is restricted to cases where the effect thereof shall not be in restraint
of trade, to lessen competition, nor to create a monopoly. No cor­
poration, except as specifically provided herein, shall be organized
under this act for the purpose of acquiring or owning real estate. No
corporation under the act shall, except as provided, 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, or
receiving deposits of money, or foreign coins, or buying and selling
bills of exchange, or issuing bills, notes, or other evidences of debt
for circulation as money; but corporations created, or to be created
under the provisions of the act, to buy, sell, or otherwise deal in notes
(not including the discounting of notes), open accounts, and other
similar evidences of debt (not including bills of exchange), shall not
be considered within this prohibition. No corporation shall be
created under this act to deal in commercial paper in the exercise of
the functions of bank discount.
The board of directors must consist of at least three persons, who
shall be stockholders and one of whom must be a resident of this
State. The directors exercise the corporate powers of the corporation.


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They may hold meetings and transact business outside of this State.
They elect officers, adopt by-laws, and may appoint an executive
committee. The name of a corporation must indicate that it is a
corporation. If the name of a person or copartnership is used, it
must be followed by the word “corporation,” “incorporated,”
“limited," or their abbreviations. The corporation must maintain
an office or place of business in this State, with a resident officer or
agent in charge. The Secretary of State must be kept informed of
any change of address of such office or place of business.
Each share of stock when issued shall nave stamped thereon the
amount actually received by the corporation for such stock, either in
cash, property, services rendered, or expenses incurred. Each certi­
ficate must contain a statement of the rights of the holder, whether
the stock has been fully paid, and if not what per cent of it has been
paid. When additional payments are made they must be stamped
on the certificate. Shares without par value shall be represented
by certificates which shall state the number of shares, the name of
the holder and the total number of shares the corporation is author­
ized to issue. All stockholders’ meetings must be held within this
State. Directors are elected at the regular annual meeting of the
stockholders. No stock can be voted which shall have been trans­
ferred on the books of the corporation within ten days prior to such
meeting. No proxy is good after eleven months from its execution,
except where the stock is pledged as security for a debt to the person
holding the proxy.
Stockholders are liable to creditors, after exhaustion of the assets
of the corporation, only to the amount unpaid on the shares held by
them. Solvent stockholders are liable for two weeks unpaid wages
to employees. An assignee of unpaid stock, with notice, is liable as
though he had been the original subscriber; but only the real owner
is liable.
Corporation report on first of February each year to secretary
of state.
Decree in foreclosure. (See Mortgages.)
Foreign Corporations. Each foreign corporation organized for
pecuniary profit (except banking, insurance, building and loan, and
surety companies), not now licensed to do business in this State, shall
before it transacts any business or maintains an office in this State,
procure a certificate of authority therefor from the Secretary of State.
No foreign corporation shall engage or continue in any kind of business
In this State, the transaction of which by domestic corporations is
not permitted by the laws of this State. Each licensed foreign cor­
poration shall keep on file in the office of the Secretary of State a
copy of its charter and all amendments thereto; and also a verified
statement giving the location of its principal office in this State and
the name and address of an agent on whom service of process may be
had. No foreign corporation doing business in this State without a
license shall be permitted to maintain any suit at law or in equity
In any of the courts in this State upon any demand, whether arising
out of contract or tort; and all such corporations shall be liable by
reason thereof to a penalty therefor of not less than $250 nor more
than $1,000, to be recovered in any court of competent jurisdiction.
In a civil action to be begun and prosecuted by the Attorney-General.
Each corporation including railroads, domestic and foreign, other
than homestead associations, building and loan associations, banks,
religious corporations, insurance companies, and corporations not for
pecuniary profit shall make a report in writing to the Secretary of
State between February 1 and March 1 of each year for the calendar
year ending December 31, preceding, on forms to be prescribed and
furnished by the Secretary of State. Such report shall give the address
of the corporation, officers and directors in this State by street and
number; and also shall disclose such facts as necessary to enable
the Secretary of State to ascertain the proportion of its capital stock
represented by business transacted and property located in this State
and such other information as may be necessary or appropriate in
order to assess the annual license fee or franchise tax.
Fees and Taxes. To the Secretary of State on filing a certificate
of incorporation one-twentieth of 1 per cent upon the amount of
issued capital stock, but in no event less than $20. If the stock has
no par value, for the purpose of fixing the fee the shares shall be
taken and considered at the amount of the consideration received by
the corporation therefor. A like fee upon any subsequent increase.
Upon the filing of a certicate of amendment additional fee of $20. A
foreign corporation, other than an insurance company or building and
loan company, upon obtaining a certificate to do business in Illinois
pays the same fees upon the amount of its capital stock represented
by business transacted and tangible property in Illinois as similar
domestic corporations pay upon incorporation. If the stock of a
foreign corporation has no par value, for the purpose of fixing fees and
taxes the shares shall be taken and considered at the amount of the con­
sideration received by the corporation therefor. A domestic corporation
or a foreign corporation licensed to do business in Illinois (except insur­
ance companies), and which are required to make annual reports, must
pay to the Secretary of State an annual license fee or franchise tax
amounting to 5 cents on each $100 of the proportion of its issued capital
stock represented by business transacted and property located in this
State, but in no event shall any such license fee or franchise tax be less
than $10 for any one year. If it appears from the annual report that
the corporation has no tangible property located in this State, and is
transacting no business in this State the following franchise tax must
be paid annually; on capital stock of $50,000 or less, $10; between
$50,000 and $200,000, $15; between $200,000 and $500,000, $20;
between $500,000 and $1,000,000, $50; between $1,000,000 and
$10,000,000. $200; over $10,000,000, $1,000; stock of no par value
shall be taken and considered at the amount of the consideration
received by the corporation therefor. The franchise tax is payable
on July 1 for the succeeding twelve months. If a corporation fails to
make an annual report within the time required, tfie Secretary of
State assesses a franchise tax on the best available information, adding
a penalty of 10 per cent on the amount of such assessment. In case
a corporation fails to file an annual report or pay its franchise tax as
required by the act, the Attorney-General may take proceedings to
forfeit its charter. No corporation required to pay a franchise tax
or fee under the laws of this State shall transact any business in this
State or maintain any action at law or suit in equity, unless such corpo­
ration shall have paid such franchise tax or such fees when the same
become due and payable. Corporations are taxed on their tangible
property, real and personal, within the State, and also upon the fair
cash value of their capital stock, including franchises, over and above
the assessed value of their tangible property. Shares of stock of
domestic corporations, whose tangible property or capital stock is
taxed, are not subject to taxation in the hands of owners.
A corporation organized for the purpose of accepting and executing
trusts may be appointed assignee or trustee by deed, and executor,
guardian, or trustee by will, and any court may appoint such com­
pany receiver, assignee, guardian, conservator, executor, adminis­
trator, or other trustee, provided such appointment apply to the
estate only and not to the person. Such corporation is not generally
required to give bond for the performance of a trust, but it is required
to deposit with the Auditor of Public Accounts $200,000 in bonds of
the United States, or in municipal bonds of this State, or real estate
mortgages, and to make a statement, and file reports with the Auditor
annually. There are special acts also as to the organization of cor­
porations not for pecuniary profit, religious corporations, loan asso­
ciations, co-operative associations for profit, insurance, etc. Cor­
porations, foreign or domestic, under certain restrictions, may do a
surety business.
Courts. Supreme court (seven judges); four appellate courts
(intermediate court of appeals, three judges each); circuit courts (in
Cook County also superior court of equal jurisdiction); criminal
courts; county courts (which also exercise probate jurisdiction In
counties having less than 70,000); probate courts (in counties having
over 70,000); municipal courts (Chicago has a municipal court with
a chief justice and thirty-six associate judges and special practice)and justice courts.

BANKING AND COMMERCIAL LAWS—ILLINOIS
Days of Grace are abolished. (See Negotiable Instruments.)
Deeds conveying land should be signed, sealed, and acknowledged
by grantor. Scrawl seal is sufficient. No subscribing witnesses are
required. Statutory forms of warranty and quit claim deeds and
mortgages are provided. The words employed are (1) conveys and
warrants, (2) conveys and quit claims, (3) mortgages and warrants.
No deed releases the right of homestead unless it contains a clause
substantially as follows: “Hereby releasing and waiving all rights
under and by virtue ot the homestead exemption laws of the State
of Illinois,” in which ease the certificate of acknowledgment should
contain the clause, “including the release and waiver of the right
of homestead.” To release dower the husband or wife must join in
the conveyance, except in the case of a mortgage for purchase money;
otherwise the husband and wife may convey as unmarried. Deeds
and other instruments affecting real estate should be recorded in the
county where the real estate is situated; until so recorded they are
void as to creditors and subsequent purchasers without notice. (See
Land Registration.)
Depositions. In chancery cases If the witness resides in the
county, depositions may be taken on five days' notice; otherwise on
ten days’ notice and one day in addition for every fifty miles. At
law, on like ten days’ notice, where the witness resides in another
county or is about to depart from the state. Where the witness
resides out of the county or state, the deposition may be taken before
a notary public or commissioner on a commission issued on ten days
notice, either on written or oral interrogatories; one day additional
notice of the time and place of taking the deposition being required
for each one hundred miles. If a witness subpoenaed to give his
deposition before a notary public or other officer under commission
Issued by a court of this State, or of any other State or country,
declines to appear or testify he may be cited before the circuit court
of the county where he resides and be compelled to appear, testify,
and produce documents.
Descent and Distribution. Property in this State, both real
and personal, of residents and nonresident proprietors in this State
dying intestate, or whose estates or any part thereof shall be deemed
and taken as intestate estate, after all just debts and claims against
such estate are fully paid, shall descend to and be distributed in
manner following, to wit: 1. To his or her children and their descend­
ants, in equal parts; the descendants of the deceased child or grand­
child taking the share of their deceased parents in equal parts among
them. 2. When there is no child of the intestate, nor descendant of
such child, and no widow or surviving husband, then to the parents,
brothers and sisters of the deceased and their descendants, in equal
parts among them, allowing to each of the parents, if living, a child’s
part or to the survivor of them if one be dead, a double portion; and
if there is no parent living, then to the brothers and sisters of the
intestate, and their descendants. 3a. When there is a widow or
surviving husband and also parents, brothers and sisters of the
deceased and their descendants but no child or children, or descend­
ants of a child or children of the intestate, then (after the payment
of all just debts) one-half of the real estate and the whole of the
personal estate shall descend to such widow or surviving husband as
an absolute estate forever and the other half of the real estate shall
descend to the parents, brothers and sisters of the deceased and their
descendants in equal parts among them, allowing to each of the
parents, if living, a child’s part to the survivor of them, if one be
dead a double portion; and if there is no parent living, then to the
brothers and sisters of the intestate and their descendants. 3b. When
there is a widow or surviving husband and no child or children or
descendants of a child or children of the intestate and no parents,
brothers or sisters of the deceased and their descendants, then after
the payment of all just debts, the entire estate, real and personal,
shall descend to the surviving widow or husband outright. 4. When
there is a widow or a surviving husband and also a child or children
or descendants of such child or children of the intestate, the widow
or surviving husband shall receive as his or her absolute personal
estate, one-third of all the personal estate of the intestate; and he or
she shall also receive as his or her absolute estate, in lieu of dower
therein, one-third of each parcel of real estate of which the intestate
died seized and in which such widow or surviving husband shall waive
his or her right of dower. 5. If there is no child of the intestate or
descendant of such child, and no parent, brother or sister, or descend­
ant of such parent, brother or sister, and no widow or surviving
husband, then such estate shall descend in equal parts to the next
of kin to the intestate in equal degree (computing by the rules of Civil
Law), and there shall be no representation among collaterals, except
with the descendants of brothers and sisters of the intestate; and
in no case shall there be any distinction between the kindred of the
whole and the half blood. (5. If any intestate leaves a widow or sur­
viving husband and no kindred, his or her estate shall descend to such
widow or surviving husband. 7. If the intestate leaves no kindred,
and no widow or husband, his or her estate shall escheat to and vest
in the county in which said real or personal estate, or the greater
portion thereof, is situated. (See Dower and Curtesy.)
Dower. A surviving husband has dower (1. e., life Interest in a
third part of all lanas whereof deceased was seized of an estate of
inheritance during marriage) the same as a widow. Equitable estates,
and land contracted for before death, are subject to dower. If dower
is waived, surviving husband or wife takes one third of the real estate
and personal estate absolutely. Dower may be barred by jointure
assented to; by devise, unless widow or surviving husband renounces
benefit of devise within one year from date of letters of administration;
by divorce as to the party in fault; and by abandonment coupled with
adultery. There is no dower in land as against a purchase-money lien
The husband or wife may renounce any devise under the will of the
other and take if there be children, one third of the real estate, and
one-third of personal estate, or, if no children, one-half of both real
and personal estate absolutely.
Executions. (See Judgments and Executions.)
Executors and Administrators. (See Administration.)
Exemptions. There is a homestead exemption to the extent of
$1000. It may be extinguished by conveyance joined in by husband
and wife properly acknowledged. (See Deeds.) The following
personal property is exempt; 1. The necessary wearing apparel,
Bibles, school books, and family pictures. 2. One hundred dollars
worth of other property, to be selected by the debtor, and in addition,
when the debtor is the head of a family and resides with the same,
$300 worth of other property, to be selected by the debtor. Exempr Ions can not be claimed out of partnership property. The wages
of an employee being the head of a family and residing with the same
are exempt from garnishment to the amount of $15 per week.
Frauds, Statute of. The following contracts should be in writing:
a. A promise of an executor or administrator to answer any debt or
C arnages out of his own estate. 2. A promise to answer for the debt,
Cefault, or miscarriage of another. 3. An agreement made in con­
sideration of marriage. 4. An agreement not to be performed within
one year. 5. Any contract for the sale of lands, or any interest
therein for a longer term than one year. 3. Express trusts relating
to real estate. ” a contract to sell or a sale of any goods or cnoses
In action of the value of five hundred dollars or upwards is not enforcible Dy action, unless the buyer accepts part of the goods or choses
In action so contracted to be sold or sold, and actually receives the
same, or gives something in earnest to bind the contract, or in part
payment, or unless some note or memorandum in writing of the
contract or sale be signed by the party to be charged or his agent in
that behalf. The act applies to sales for future delivery and to goods
to be obtained or manufactured by the seller, but not to sales of goods
to be manufactured on special order if they be not suitable for sale
to others in the usual course of business.”
Garnishment. The funds or property of a debtor in the possession
of a third party may be garnished in an attachment suit, or in a separate
nroceeding after judgment has been obtained against the principal
debtor. (See Attachments.) Wages up to $20.00 a week are exempt
from garnishment.


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2165

Holidays, Legal. January 1st, February 12t.h, February ■22d,
May 30th, July 4th, October 12th, December 25th, first Monday in
September (Labor Day), Thanksgiving Day, and Tuesdays next after
the first Mondays in November in even years (election days), Novem­
ber 11th, Armistice Day; also every Saturday from 12 o’clock noon
to 12 o’clock midnight. Where holidays fall on Sunday, the day
following.
Husband and Wife. (See Married Women.)
Insurance. Agents are required to have license. Write director
of Trade and Commerce, Springfield, Ill. Insurance companies are
bonded to state.
Interest. Extreme contract rate, 7 per cent, except as to corpora­
tions, no limit as to corporations; legal rate, 5 per cent. Interest is
allowed at the legal rate on moneys after they become due on any bond,
bill, promissory note, or other instrument in writing; on monej loaned
or advanced for the use of another; on money due on the settlement
of an account, from the date of ascertaining the balance; on money
received to the use of another, and retained without the owner’s
knowledge; and on money withheld by an unreasonable and vexa­
tious delay of payment. Judgments or decrees draw interest at 5 per
cent. Penalty for contracting for more than 7 per cent is the loss of
the entire interest, and only the principal sum can be recovered. A
written contract, wherever payable made, in this State between
citizens of this State and of a foreign State (or secured by a mortgage
on lands in this State) is controlled by the law of this State as to the
rate of interest, and the penalty for usury. Usury must be specially
pleaded. In all computations of time, and of interest and discounts,
a month is considered to mean a calendar month, and a year twelve
calendar months, and a day the thirtieth part of a month. A foreign
corporation is subject to the same penalties for usury as a citizen of
this State. Justice of Peace has jurisdictionin all claims under $500
Judgments and Executions. A judgment is a lien on real
estate situated in the county where the judgment is rendered, for
seven years from its date, and to become a lien on land registered
under Torrens System must be filed with registrar of titles. If an
execution is not issued on a judgment within one year the judgment
ceases to be a lien. A transcript of a judgment in another county
may be filed and thereupon becomes a lien upon real estate of the
defendant in the county where filed, and execution may issue there­
under. An execution becomes a lien on personal property from the
time it is delivered to the officer to be executed. All goods and chat­
tels, including and money stock in a corporation, may be levied on.
Personal property may be sold under execution on ten days' notice.
A forthcoming bond may be given by the defendant to the officer.
A third party claiming the property levied on may have a trial as
to the right of property in the county court. Judgments may be
confessed by a debtor or his authorized attorney without process in
term time or vacation. Land Registration Torrens System in use
in Cook County. (See Mortgage Foreclosure.) Judgments may be
revived for further period of seven years at expiration of seise facias
kept alive for 20 years.
Liens. A landlord has a lien for rent upon crops growing on the
demised premises. Hotel, inn, and boarding-house keepers have a
lien upon baggage and other valuables of guests. Stable-keepers have
a lien upon horses, carriages, and harness for the keeping thereof.
Garage keepers are entitled to liens on automobiles, parts and acces­
sories, for keeping, repairing, materials furnished thereto, and the
expenses bestowed thereon at the request of the owner, or the person
having the possession thereof. Agisters and persons keeping, yarding,
and,feeding domestic animals have a lien therefor. All persons furnish­
ing supplies, or doing work for any railroad organized under the laws
of this State, necessary for the construction, maintenance, operation,
or repair of the road, have a lien therefor on all the property of the
company, which is good as against mortgages and other liens acquired
after the commencement of the delivery of supplies, or the doing of
the work. Attorneys have liens on all demands, claims, and causes of
action of their clients, after the service of notice upon the adverse
party. Contractors and sub-contractors, including architects, super­
intendents, timekeepers, etc., have liens on any real estate, interest
therein, or improvements thereon, for all kinds of labor and services
performed, and materials furnished for the erection of any building,
or the improvement of any real estate, or thing connected therewith.
A person furnishing material, apparatus, fixtures, machinery or labor
to a contractor for a public improvement, has a lien upon the money,
bonds or warrants due or to become due under such contract: Pro­
vided, the claimant serves upon the municipality a notice of his claim
before payment be made to such contractor; but the lien attaches only
to the portions of the money, bonds, or warrants against which no
voucher or other evidence of indebtedness has been issued and delivered
to the contractor.
Limitations. In personal actions as follows: Libel and slander,
one year; actions for damages for injury to persons, two years (where
death results, one year after death); for false imprisonment, malicious
prosecution, for a statutory penalty, for abduction, seduction, or
criminal conversation, two years; actions on unwritten contracts,
express or implied, on awards of arbitration, to recover damages for
Injury to property real or personal, to recover possession of personal
property, or damages for the detention of conversion thereof, and
all civil actions not otherwise provided for, five years; actions on
bonds, promissory notes, bills of exchange, written leases, written
contracts, or other evidences of indebtedness in writing, ten years:
but any payment or new promise to pay in writing renews the right of
action on such instrument for ten years from the time of such payment
or promise. A domestic judgment of a court of record, twenty years;
of a foreign court of record, five years.
Limited Partnership. There are statutory provisions as to the
formation of limited partnerships, but such partnerships are not
common in Illinois.
Married Women. A married woman may sue, be sued, or defend,
as if she were unmarried. When the husband deserts, the wife may
prosecute or defend in his name. The husband has the same right
upon the desertion of the wife. The husband is not liable for the
wife’s torts except in cases where he would be jointly responsible
if the marriage did not exist. The husband or wife is not liable for
the debts of the other incurred before marriage, or for the separate
debts of each after marriage, except that the husband and wife are
jointly and severally liable for the expenses of the family and the
education of their children. The wife may contract as if unmarried,
except that she can not carry on a partnership business without the
consent of her husband, unless he has abandoned her, or is insane,
or confined in the penitentiary. She may receive and use her own
earnings free from the interference of the husband or his creditors.
Neither the husband nor the wife can recover compensation for any
labor performed or services rendered for the other. She may own
In her own right real and personal property obtained by descent,
gift, or purchase, and manage, sell and convey it to the same extent
that the husband can property belonging to him; but no transfer of
personal property between the husband and wife living together Is
good as against third persons, unless acknowledged and recorded as
chattel mortgages are required to be. A married woman who without
her fault lives apart from her husband may maintain an action for
reasonable support and maintenance. The wife may insure her
husband's lire. She may become surety fop the husband. She may
execute a will, if over eighteen years of age. at which age she attains
majority.
Mortgages. Real estate mortgages should be executed and ac­
knowledged the same as deeds. The wife must loin to bar dower,
except in mortgages for purchase-money. Trust deeds are often
oreferred to mortgages because of the facility in the transfer of the
security and, in case of non-resident creditors, in obtaining a release,
the trustee generally being a resident. Real estate mortgages may
be released upon the record or by release deed. Mortgages and
trust deeds must be foreclosed by scire facias or by regular foreclosure
suit In a court or chancery. In extreme cases, where the mortgaged
property is clearly of less value than the debt secured and the mort-

2166

BANKING AND COMMERCIAL LAWS—ILLINOIS

gagor is insolvent, there may be a strict foreclosure which cuts off the
right of redemption, in which case the mortgagee takes the property
in discharge of the debt. In other cases, after decree of foreclosure,
the officer designated to execute the decree delivers a certificate of
sale to the purchaser and files a copy thereof for record. The debtor
may redeem within twelve months, or if no judgment creditor redeems,
then within fifteen months: at the end of which time the purchaser
is entitled to a deed. The holder in due course of a note secured by
a mortgage or trust deed on real estate in Illinois stands in no better
position, so far as the enforcement of his security is concerned, than
the payee or original holder: but this doctrine does not apply to
corporate bonds payable to bearer.
Mortgage Foreclosure. When any final decree has been entered
and service obtained by publication he may within 90 days after
notice in writing or within one year where no notice is given after
such decree is entered petition the court to set the same aside. Re­
demption may be made in 90 days thereafter, upon terms equitable
and just..
Negotiable Instruments. The “Uniform Negotiable Instru­
ments Law” is in force in Illinois, with the following modifications:
1. All Promissory Notes, Bonds, Due Bills, and other instruments in
writing, whereby one promises or agrees, to pay any sum of money
or articles of personal property, or any sum of money in personal
property, or acknowledges any sum of money or article of personal
property to be due, are negotiable. Except as to Promissory Notes
payable in money due diligence must be used by the holder against
the maker, if he be a resident and solvent, by suit at first term of
Court after maturity, in order to hold the endorser. 2. Accommoda­
tion paper may be issued after maturity, if such was the intention of
the accommodating party. 3. The addition of words of assignment
or guaranty to a blank indorsement does not affect the signature as
an indorsement unless otherwise expressly stated. 4. The defenses of
fraud and circumvention in the execution of negotiable paper, or that
the consideration arose out of a gambling transaction prohibited by
sections 130, 131, and 136 of our Criminal Code, may be asserted as
against a holder in due course. 5. The fact that a depositor makes
his note payable at a bank does not authorize the bank to pay it out
of his funds on deposit. 6. An alteration of an instrument voids it
only when it is material or fraudulent, and made by the holder. 7. A
promise in writing to accept a bill made either before or after it is
drawn is deemed an actual acceptance as to the person receiving
the bill on the faith thereof. 8. Section 137 of the Uniform Negotiable
Instruments Law, providing that the destruction by the drawee of a
bill of exchange left with him for acceptance, or his refusal to return
the same within twenty-four hours after delivery to him or within
such further period as the holder might allow, should be deemed an
acceptance of the bill, is omitted from the Illinois act
Except as otherwise provided by agreement and except as to sub­
sequent holders of a negotiable instrument payable to bearer or
indorsed specially or in blank, where an item is deposited or received
for collection, the bank of deposit shall be agent of the depositor for
its collection and each subsequent collecting bank shall be sub-agent
of the depositor but shall be authorized to follow the instructions of
its immediate forwarding bank and any credit given by any such agent
or sub-agent bank therefor shall be revocable until such time as the
proceeds are received in actual money or an unconditional credit given
on the books of another bank, which such agent has requested or
accepted. Where any such bank allows any revocable credit for an
item to be withdrawn, such agency relation shall nevertheless con­
tinue except the bank shall have all the rights of an owner thereof
against prior and subsequent parties to the extent of the amount
withdrawn.
A credit given by a bank for an item drawn on or payable at such
bank shall be provisional, subject to revocation at or before the end of
the day on which the item is deposited in the event the item is found
not payable for any reason. Whenever a credit is given for an item
deposited after banking hours such right of revocation may be exer­
cised during the following business day.
An indorsement of an item by the payee or other depositor “for
deposit” shall be deemed a restrictive indorsement and indicate that
the indorsee bank is an agent for collection and not owner of the item
An indorsement “pay any bank or banker” or having equivalent
words shall be deemed a restrictive indorsement and shall indicate the
creation of an agency relation in any subsequent bank to whom the
paper is forwarded unless coupled with the words indicating the crea­
tion of a trustee relationship; and such indorsement or other restric­
tive indorsement whether creating an agency- or trustee relationship
shall constitute a guaranty by the indorser to all subsequent holders
and to the drawee or payor of the genuineness of and the authority to
make prior indorsements and also to save the drawee or payor harm­
less in the event any prior endorsement appearing thereon is defective
or irregular in any respect unless such indorsement is coupled with
appropriate words disclaiming such liability as guarantor.
Where a deposited item is payable to bearer or indorsed by the
depositor in blank or by special indorsement, the fact that such item
is so payable or indorsed shall not change the relation of agent of the
bank of deposit to the depositor, but subsequent holders shall have
the right to rely on the presumption that the bank of deposit is the
owner of the item. The indorsement of an item by the bank of deposit
or by any subsequent holder in blank or by special indorsement or its
delivery when payable to bearer shall carry the presumption that the
indorsee or transferee is owner provided there is nothing upon the
face of the paper or in any prior indorsement to indicate an agency
or trustee relation of any prior party. But where an item is deposited
or is received for collection indorsed specially or in blank, the bank
may convert such an indorsement into a restrictive indorsement by
writing over the signature of the indorser the words “for deposit” or
“for collection,” or other restrictive words to negative the presumption
that such bank of deposit or indorsee bank is owner; and in the case of
an item deposited or received for collection payable to bearer, may
negative such presumption by indorsing thereon the words “received
for deposit” or “received for collection” or words of like import.
It shall be the duty of the initial or any subsequent agent collecting
bank to exercise ordinary care in the collection of an item and when
such duty is performed such agent bank shall not be responsible if for
any cause payment is not received in money or an unconditional credit
given on the books of another bank, which such agent bank has
requested or accepted. An initial or subsequent agent collecting bank
shall be liable for its own lack of exercise of ordinary care but shall
not be liable for the neglect, misconduct, mistakes or defaults of any
other agent bank or of the drawee or payor bank.
Where an item is received on deposit or by a subsequent agent
bank for collection, payable in another town or city, it shall be deemed
the exercise of ordinary care to forward such item by mail, not later
than the business day next following its receipt either (1) direct to
the drawee or payor in the event such drawee or payor is a bank or
(2) to another bank collecting agent according to the usual banking
custom, either located in the town or city where the item is payable
or in another town or city.
Where an item is received on deposit or by a subsequent agent
bank for collection, payable by or at another bank in the same town
or city in which such agent bank is located, it shall be deemed the
exercise of ordinary care to present the item for payment at any
time not later than the next business day following the day on which
the item is received either (1) at the counter of the drawee or payor
by agent or messenger or (2) through the local clearing house under the
regular established procedure, or according to the usual banking cus­
tom where the collecting or payor bank is located in an outlying district
The designation of the above methods shall not exclude any other
method of forwarding or presentment which under existing rules of
law would constitute ordinary care.
Where the item is received by mail by a solvent drawee or payor
bank, it shall be deemed paid when the amount is finally charged to
the account of the maker or drawer.
Where an agent bank forwards an item for collection, it shall not
be responsible for its loss or destruction in transit or, when in the


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possession of others, for its inability to repossess itself thereof, pro­
vided there has been no lack of ordinary care on its part.
Where ordinary care is exercised, any agent collecting bank may
receive in payment of an item without becoming responsible as debtor
therefor, whether presented by mail, through the clearing house or over
the counter of the drawee or payor, in lieu of money, either (a) the
check or draft of the drawee or payor upon another bank or (b) the
check or draft of any other bank upon any bank other than the drawee
or payor of the item or (c) such method of settlement as may be cus­
tomary in a local clearing house or between clearing banks or other­
wise: Provided that whenever such agent collecting bank shall request
or accept in payment an unconditional credit which has been given to
it on the books of the drawee or payor or on the books of any other
bank, such agent collecting bank shall become debtor for such item
and shall be responsible therefor as if the proceeds were actually
received by it in money.
Where ordinary care is exercised, any agent collecting bank may
receive from any subsequent bank in the chain of collection in remit­
tance for an item which has been paid, in lieu of money, the check or
draft of the remitting bank upon any bank other than itself or the
drawee or payor of the item or such other method of. settlement as
may be customary; provided that whenever such agent collecting
bank shall request or accept an unconditional credit which has been
given to it on the books of the remitting bank or on the books of any
other bank, such agent collecting bank shall become debtor for such
item and shall be responsible therefor as if the proceeds were actually
received by it in money.
Where an item is duly presented by mail to the drawee or payor,
whether or not the same has been charged to the account of the maker
or drawer thereof or returned to such maker or drawer, the agent
collecting bank so presenting may, at its election, exercised with
reasonable diligence, treat such items as dishonored by non-payment
and recourse may be had upon prior parties thereto in any of the
following cases:
(1) Where the check or draft of the drawee or payor bank upon
another bank received in payment therefor shall not be paid in due
course;
(2) Where the drawee or payor bank shall without request or
authority tender as payment its own check or draft upon itself or
other instrument upon which it is primarily liable;
(3) Where the drawee or payor bank shall give an unrequested or
unauthorized credit therefor on its books or the books of another
bank; or
(4) Where the drawee or payor shall retain such item without;
remitting therefor on the day of receipt or on the day of maturity ir
payable otherwise than on demand and received by it prior to or on
such day of maturity.
Provided, however, that in any case where the drawee or payor
bank shall return any such item unpaid not later than the day of
receipt or of maturity as aforesaid in the exercise of its right to make
payment only at its own counter, such item cannot be treated as
dishonored by non-payment and the delay caused thereby shall not
relieve prior parties from liability.
Provided further that no agent collecting bank shall be liable to
the owner of an item where, in the exercise of ordinary care in the
interest of such owner, it makes or does not make the election above
provided or takes such steps as it may deem necessary in cases (2).
(3) and (4) above.
In case of the dishonor of an item duly presented by mail as pro­
vided for in the next preceding section, notice of dishonor of such
item to prior parties shall be sufficient if given with reasonable dili­
gence after such dishonor; and further in the event of failure to obtain
the return of any such item notice of dishonor may be given upon a
copy or written particulars thereof, and delay in giving notice of dis­
honor caused by an attempt with reasonable diligence to obtain return
of such item shall be excused.
1. When the drawee or payor, or any other agent collecting bank
shall fail or be closed for business by the Auditor of Public Accounts
in the case of banks incorporated under the laws of this State, or the
Comptroller of the Currency in the case of banks incorporated under
the Federal laws, or by action of the board of directors or by other
proper legal action, after an item shall be mailed or otherwise entrusted
to it for collection or payment but before the actual collection or pay­
ment thereof, it shall be the duty of the receiver or other official in
charge of its assets to return such item, if same is in his possession, to
the forwarding or presenting bank with reasonable diligence.
2. Except in cases where an item or items is treated as dishonored
by non-payment as provided in section 11, when a drawee or payor
bank has presented to it for payment an item or items drawn upon
or payable by or at such bank and at the time has on deposit to the
credit of the maker or drawer an amount equal to such item or items
and such drawee or payor shall fail or close for business as above,
after having charged such item or items to the account of the maker
or drawer thereof or otherwise discharged his liability thereon but
without such item or items having been paid or settled for by the
drawee or payor either in money or by an unconditional credit given
on its books or on the books of any other bank, which has been requested
or accepted so as to constitute such drawee or payor or other bank
debtor therefor, the assets of such drawee or payor shall be impressed
with a trust in favor of the owner or owners of such item or items for
the amount thereof, or for the balance payable upon a number of items
which have been exchanged, and such owner or owners shall be
entitled to a preferred claim upon such assets, irrespective of whether
the fund representing such item or items can be traced and identified
as part of such assets or has been intermingled with or converted
into other assets of such failed bank.
3. Where an agent collecting bank other than the drawee or payor
shall fail or be closed for business as above, after having received in
any form the proceeds of an item or items entrusted to it for collec­
tion, but without such item or items having been paid or remitted for
by it either in money or by an unconditional credit given on its books
or on the books of any other bank which has been requested or accepted
so as to constitute such failed collecting or other bank debtor therefor,
the assets of such agent collecting bank which has failed or been
closed for business as above shall be impressed with a trust in favor
of the owner or owners of such item or items for the amount of such
proceeds and such owner or owners shall be entitled to a preferred
claim upon such assets, irrespective of whether the fund representing
such item or items can be traced and identified as part of such assets
or has been intermingled with or converted into other assets of such
failed bank.
In any case not provided for in this Act the rules of law and equity,
including the law merchant and those rules of law and equity relat­
ing to trusts, agency, negotiable instruments and banking, shall
continue to apply.
Partnership. The Uniform Partnership Act and the Uniform
Limited Partnership Act are in force in Illinois.
Probate Law. (See Administration of Estates.)
Recording Acts. In counties having a population of less than
60,000, the clerk of the circuit court is ex officio the recorder. In
other counties a “recorder of deeds" is elected. As to what instru­
ments must be recorded, see respective titles.
Replevin. The action lies for personal property wrongfully de­
tained. The action may be brought in any county where the property
is, or where any of the defendants reside or may be found. Before
the execution of the writ, the plaintiff, or some one in his behalf,
must give the officer a bond with sufficient security (a real estate
owner of the county is generally required) in double the value of the
property defendant may execute bond for double value of property
conditioned on defense of suit and retain possession of property.

BANKING AND COMMERCIAL LAWS—INDIANA
Sales. The Uniform Sales Act has been adopted in Illinois. Sales
of securities are by consent of Illinois Securities Commission and are
classified. (See Blue Sky Law.)
Sales In Bulk. Sales of the major part or ail of a stock in trade,
chattels or fixtures not in the ordinary course of business, are fraudu­
lent and void as to creditors unless the buyer obtains from the seller
an affidavit giving a list of his creditors with addresses and amounts
due each, and the buyer, five days before payment, gives notice to
each creditor personally or by mail of the contemplated purchase.
Trust Estates. Subject to rules of Chancery disbursements to
be approved by court.
Taxes. All real and personal property in this State, including
moneys, credits, bonds, stocks, investments, shares of stock in cor­
porations (see Corporations), and of banks doing business in this State,
is subject to taxation. Real and personal property is listed with the
County Assessor and assessed between April 1st and June 1st as of
April 1st. The taxes are payable on or before May 1st of the ensuing
year; after which time penalties are added. There is an Inheritance
Tax Law, the rates varying according to the relationship of the heir,
devisee, or legatee, ana the amount of the legacies, ranging from 2 per
cent in the cases oi widow ana children, as to legacies exceeding $20,000
and not exceeding $50,000 to 30 per cent on amounts bequeathed to
persons not related to the deceased exceeding $100.
Warehouse Receipts. The Uniform Warehouse Receipts Law
Is in force in Illinois.
Wills. Every male over twenty-one, and female over eighteen.
Is competent to make a will. It must be signed by the testator or
by some person in his presence and by his direction, and attested in
his presence at his request by at least two witnesses. The witnesses
should be disinterested. A devise to a witness is void unless the will
be otherwise duly attested by two witnesses exclusive of such person.
Where the subscribing witnesses are dead, secondary evidence of the
execution is admissible. The will is proved, after notice to heirs and
legatees, in the county (or probate) court, and may be contested, in
chancery, within one year after its probate. Wills or authenticated
copies, affecting estate within this State, duly proved outside of this
State, in accordance with the law of the State where executed, accom­
panied with a certificate of the proper officer of that fact, may be
recorded here. Wills executed and published out of this State may
be admitted to probate in any county in this State where the testator
had lands or personal property upon like proof as if executed and pub­
lished here, whether or not the will has been first probated in another
state or county. The Uniform Foreign Probate Act is in force in
Illinois. All originals wills, after being filed, must remain in the office
of the county (or probate) court. Children may be disinherited.

SYNOPSIS OF

THE LAWS OF INDIANA
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Vesey, Shoaff & Hoffman, Attorneys-at-Law
First & Tri State Bldg., Fort Wayne, Ind.
(See Card in Attorneys List.)
Acknowledgments. All conveyances of real estate, except leases
for less than three years, must be in writing, and acknowledged and
recorded at once, or they will not bind third parties. Within the
State acknowledgments may be taken before a judge or clerk of the
court of record, justice of the peace, auditor recorder, notary public,
member of the general assembly, or mayor of a city, and in other
states and territories before the like officers, or a commissioner of
deeds for Indiana. In any foreign country, before a diplomatic or
consular officer of the United States. If such acknowledgment or
roof is in some other than the English language, or is not attested
y such official seal, it must be accompanied by the certificate of an
officer of the United States, to the effect that it is duly executed accord­
ing to the laws of such foreign country, and that the officer has legal
authority to certify to the proof or acknowledgment and the meaning
of his certificate, if made in a foreign language. Wife must join in
deeds and mortgages of husband's lands in order to carry her in­
choate one-thira interest in husband’s lands. No separate acknowl­
edgment of wife necessary in order to convey her inchoate interest
In husband’s lands, although she must acknowledge. The certifying
officer should state the date when his commission expires.
Actions. The distinction between actions at law and suits in
equity, and the forms of each, are abolished. There is but one form
of action for the enforcement of private rights and redress of private
wrongs, denominated by the Code a civil action. Every action must
be prosecuted in the name of the real party in interest, except in suits
by an executor, administrator, guardian of an idiot or lunatic, trustee
of an express trust, or person expressly authorized by statute, who
needs not join with them the person for whom the action is prosecuted.
All parties in interest must be joined as plaintiffs or defendants;
and when a complete determination of the controversy can not be
had without the presence of other parties, who have not been made
plaintiffs or defendants, the court must cause them to be joined.
Commencement. A civil action is commenced by filing in the
office of the clerk a complaint and causing summons to issue thereon;
and the action is deemed commenced from the time of issuing the
summons, or, if publication be made, from the time of the first pub­
lication.
Joinder of Causes. The plaintiff may unite several causes of
action in the same complaint, but they must fall within the term of
the statute, and causes of actions so joined must affect all the parties
to the action, must not require different places of trial and must be
separately stated and numbered.
Severance. Where causes of action are improperly joined the
court is required by statute to cause as many separate actions to be
docketed as there are causes improperly joined.
Consolidation. The courts have inherent power to consolidate
causes before them in the absence of statute, when necessary to the
ends of justice and to avoid a multiplicity of suits.
Joint Debtors. In an action against defendants jointly indebted
on contract, plaintiff may proceed against such defendant or de­
fendants as are served. A judgment may be enforced against joint
property of all and the separate property of those served. Where
judgment is recovered against one or more persons jointly liable on
contract, but judgment is rendered against only part of the persons
jointly liable for the reason that others were not summoned or did
not appear, plaintiff may proceed against those not summoned and
not appearing, in the same manner as if they were alone liable, but
the complaint must allege the facts aforesaid.


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2167

Survival. A cause of action for breach of promise to marry, or
arising out of an injury to the person, dies with the person of either
party, with the following exceptions: (1) Statutory action for his
injury causing death; (2) action for seduction; (3) action for false
imprisonment; (4) action for malicious prosecution.
All other causes of action survive.
Administration of Estates. Except in Marion and Allen Counties,
which have a separate probate court, the circuit court has exclusive pro­
bate jurisdiction. In cases of intestacy letters are granted in following
order. 1. Widow or widower. 2. Next of kin. 3. Largest resi­
dent creditor. Letters of administration shall be granted in the
county: 1. Where intestate was inhabitant at time of death. 2.
Where, not, being inhabitant of the State he leaves assets. Where
an intestate, not being an inhabitant, shall die out of the State,
leaving assets in several counties, letters may be granted in any one
of the counties in which such assets may be at time of death, and
the administration first lawfully granted shall extend to all of the
estate. Letters cannot issue to a married woman without her hus­
band’s consent in writing. Such consent makes husband jointly liable
with wife. Preference is given to foreign executor of a decedent
not an inhabitant of State, if, before letters are granted in this State
it appears that proper letters have been granted in another state,
except there be resident creditors, legatees and heirs entitled to dis­
tribution, who are inhabitants of the State. No action shall be
brought against an estate for any claim against the decedent; but
the holder thereof, whether the claim be due or not, shall file a suc­
cinct and definite statement thereof in the office of the clerk of the
court, setting forth all credits to which the estate is entitled, and
accompanied by the affidavits of the claimant, his agent, or attorney,
that the claim is just and wholly unpaid. If claim be secured by a
lien, the lien shall be particularly set forth. The claim must be filed
within one year from the notice of the administrator’s appointment,
or claimant must pay costs; and if not filed at least thirty days
before the final settlement of the estate, it shall be barred, except
that heirs, devisees and distributees shall be liable to the extent of
the property received by them, to any unpaid creditor who six months
rior to the final settlement was insane, an infant, or out of the
tate,—suit to be brought within one year of removal of disability,
and if upon claim of non-resident creditor, within two years of the
settlement of the estate.
Affidavits may be taken before any officer qualified to take acknowl­
edgments (see above). Date of expiration of officer's commission
must be certified by the officer himself.
Aliens. Resident aliens who have declared their intention to
become citizens, may acquire, hold, and enjoy real estate, and may
convey, devise, mortgage, or otherwise encumber the same, in like
manner and with the same effect as citizens of this State. Aliens,
whether resident or not, may own real estate not exceeding 320 acres
lands in excess of that amount they must convey within five years or
suffer escheat as to such excess.
Assignments and Insolvency. Any debtor may make a general
assignment of all property in trust for benefit of all bona fide creditors
This trust is administered under the direction of the county court.
Dividends are allowed on all claims allowed by the trustee or court.
Debtor is not discharged from his liabilities.
Attachment may issue against the property of a non-resident or
foreign corporation, and against any who may have disposed of, or be
about to dispose of, property, to cheat, hinder or delay creditors, or
against a creditor who conceals himself so that summons can not be
served upon him. An affidavit is required, and a bond to pay dam­
ages if the proceedings be wrongful or oppressive. Creditors who file
under the original attachment, before final judgment, are required
to furnish a like affidavit and bond, and all share pro rata in the
roceeds of the attached property. The wages of a resident houseolder, not exceeding one month at any one time, are exempt so long as
debtor remains in such employment. It is a misdemeanor to send
claims out of the State to be collected by attachment, or garnishment,
when creditor, debtor, and person owing for earnings intended te
be reached are all within the jurisdiction of the court of this State.
The collection of claims so sent may be enjoined.
Bank Collection Code. Given directly following laws.
Banks, Private. Act of 1907 (in effect Dec. 1, 1907), regulating
private banking applies to any one who may use the word “bank"
In his business. Capital must be at least $10,000, not more than onethird of which may be invested in the bank building. All real estate
must be held in name of bank. Bank cannot invest in real estate
except in realizing on doubtful claim. Statement must be filed with
state auditor showing copy of articles of partnership acknowledged
(one of the partners to be resident of the state); location, amount
of capital, net worth of partners to be double capital paid in, names
of officers. List, of officers must be posted in bank. Two reports of
resources and liabilities are called for each year by auditor and publishea in local newspaper. Examination of bank made at least
annually by auditor. Special reports can be called for by State
Bank Commissioner whenever necessary. Statement of property held
In trust by bank must be filed in county recorder’s office. Depositors
have lien on assets. Jurisdiction over all persons interested is obtained
by process served on officer in charge. Banks can not commence
business until chartered by State Charter Board. Banks cannot
establish branches without first having obtained a charter from the
State Charter Board.
Banks, Savings. Governed by a general statute which regulates
In minute detail the investments and conduct of business. Savings
banks may purchase, hold, and convey real estate for the following
purposes, and none other: For the location of banking house, real
estate mortgaged to it in good faith for money loaned, or upon which
It shall have purchased a mortgage; real estate taken upon judgments
and decrees on behalf of the bank, or purchased to prevent loss on
claims held by the bank.
Banks, State. Regulated by a general banking law. The state
department of banking appoints a bank examiner who shall not be a
director or other officer of the bank, and shall have power to make
a thorough examination into all the affairs of the bank, and, in doing
so, to examine any of the officers and agents thereof on oath. The
examiner reports in detail the condition of the bank from time to
time. The state banks must make not less than five reports each
year, verified by the president, or other managing agent, which
reports must exhibit the resources and liabilities at the close of busi­
ness on any past day to be by the auditor specified. The report so
required must be published in a newspaper where the bank is estab­
lished, or, if there is no newspaper in the place, then in one pub­
lished nearest thereto in the same county or an adjoining county.
The auditor may require special reports from any bank, whenever
In his judgment, it shall be necessary in order to a full knowledge of
Its condition. Any bank failing to make such report shall be subject
to a penalty of $100 for each day that it delavs to make and transmit
the same. All banks are empowered to execute trusts and act as
trustees.
On September 30, 1920 all duties, power and authority formerly
vested in the auditor of State as to banks of all kinds building and
loan associations, mortgage guarantee companies, rural loan and saving
associations, will be lodged in a Banking commissioner appointed by
the Governor and said Commissioner will be at the head of the Depart­
ment of Banking a separate branch of the State Government. All
laws relating to above named companies remain in full force and effect.
“Bank" includes any person or association of persons, whether
incorporated or not, carrying on the business of banking.
"Fiduciary” includes a trustee under any trust, expressed, implied,
resulting or constructive, executor, administrator, guardian, con-

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BANKING AND COMMERCIAL LAWS—INDIANA

servator, curator, receiver, trustee in bankruptcy, assignee for the
benefit of creditors, partner, agent, officer of a corporation, public
or private, public officer, or any other person acting in a fiduciary
capacity for any person, trust or estate.
“Person” includes a corporation, partnership, or other association,
or two or more persons having a joint or common interest.
“Principal” includes any person to whom a fiduciary as such owes
an obligation.
If a fiduciary in whose name are registered any shares of stock,
bonds or other securities of any corporation, public or private, or
company or other association, or of any trust, transfers the same,
such corporation or company or other association, or any of the
managers of the trust, or its or their transfer agent, is not bound to
inquire whether the fiduciary is committing a breach of his obligation
as fiduciary in making the transfer, or to see to the performance of
the fiduciary obligation, and is liable for registering such transfer
only where registration of the transfer is made with actual knowledge
that the fiduciary is committing a breach of his obligation as fiduciary
in making the transfer, or with knowledge of such facts that the
action in registering the transfer amounts to bad faith.
If any negotiable instrument payable or endorsed to a fiduciary as
such is endorsed by the fiduciary, or if any negotiable instrument
payable or endorsed to his principal is endorsed by a fiduciary em­
powered to endorse such instrument on behalf of his principal, the
endorsee is not bound to inquire whether the fiduciary is committing
a breach of his obligation as fiduciary in endorsing or delivering the
instrument, and is not chargeable with notice that the fiduciary is
committing a breach of his obligation as fiduciary unless he takes the
instrument with actual knowledge of such breach or with knowledge
of such facts that his action in taking the instrument amounts to bad
faith. If, however, such instrument is transferred by the fiduciary
in payment of or as security for a personal debt of the fiduciary to the
actual knowledge of the creditor, or is transferred in any transaction
known by the transferee to be for the personal benefit of the fiduciary,
the creditor or other transferee is liable to the principal if the fiduciary
in fact commits a breach of his obligation as fiduciary in transferring
the instrument
If a check or other bill of exchange is drawn by a fiduciary as such,
or in the name of his principal by a fiduciary empowered to draw
such instrument in the name o f the principal, the payee is not bound
to Inquire whether the fiduciary is committing a breach of his obliga­
tion in drawing or delivering the instrument, and is not chargeable
with notice that the fiduciary is committing a breach of his obligation
unless he takes the instrument with actual knowledge of such breach
or with knowledge of such facts that his action in taking the instru­
ment amounts to bad faith. If, however, such instrument is payable
to a personal creditor of the fiduciary and delivered to the creditor
in payment of or as security for a personal debt of the fiduciary, to
the actual knowledge of the creditor, or is drawn and delivered in
any transaction known by the payee to be for the personal benefit of
the fiduciary, the creditor or other payee is liable to the principal if
the fiduciary in fact commits a breach of his obligation in drawing or
delivering the instrument
If a check or other bill of exchange is drawn by a fiduciary as such,
or in the name of his principal by a fiduciary empowered to draw
such instrument in the name of his principal, payable to the fiduciary
personally, or payable to a third person and by him transferred to
the fiduciary, and is thereafter transferred by the fiduciary, whether
in payment of a personal debt of the fiduciary or otherwise, the
transferee is not bound to inquire whether the fiduciary is committing
a breach of his obligation in transferring the instrument, and Is not
chargeable with notice that the fiduciary is committing a breach of
his obligation, unless he takes the instrument with actual knowledge
of such breach or with knowledge of such facts that his action in
taking the instrument amounts to bad faith.
If a deposit is made in a bank to the credit of a fiduciary as such,
the bank is authorized to pay the amount of the deposit or any part
thereof upon the check of the fiduciary, signed with the name in which
such deposit is entered, without being liable to the principal, unless
the bank pays the check with the actual knowledge that the fiduciary
Is committing a breach of his obligation in drawing the check or with
knowledge of such facts that its action in paying the check amounts
to bad faith. If, however, such check is payable to the drawee bank
and is delivered to it in payment of or as security for a personal debt
of the fiduciary to it, the bank is liable to the principal if the fiduciary
In fact commits a breach of his obligation in drawing or delivering
the check.
If a check is drawn upon the account of his principal in a bank by
a fiduciary who is empowered to draw checks upon his principal’s
account, the bank is authorized to pay such check without being
liable to the principal, unless the bank pays the check with actual
knowledge that the fiduciary is committing a breach of his obligation
in drawing such check, or with knowledge of such facts that its action
In paying the check amounts to bad faith. If, however, such a check
is payable to the drawee bank and is delivered to it in payment of or
as security for a personal debt of the fiduciary to it, the bank is liable
to the principal if the fiduciary in fact commits a breach of his obliga­
tion in drawing or delivering the check.
If a fiduciary makes a deposit in a bank to his personal credit of
checks drawn by him upon an account in his own name as fiduciary,
or of checks payable to him as fiduciary, or of checks drawn by him
upon an account in the name of his principal if he is empowered to
draw checks thereon, or of checks payable to his principal and en­
dorsed by him, if he is empowered to endorse such checks, or if he
otherwise makes a deposit of funds held by him as fiduciary, the
bank receiving such deposit is not bound to inquire whether the
fiduciary is committing thereby a breach of his obligation; and the
bank is authorized to pay the amount of the deposit or any part there­
of upon the personal check of the fiduciary without being liable to
the principal, unless the bank receives the deposit or pays the check
with actual knowledge that the fiduciary is committing a breach of
his obligation in making such deposit or in drawing such check, or
with knowledge of such facts that its action in receiving the deposit
or paying the check amounts to bad faith.
When a deposit is made in a bank in the name of two or more
persons as trustees and a check is drawn upon the trust account by
any trustee or trustees authorized by the other trustee or trustees to
draw checks upon the trust account, neither the payee nor other
holder nor the bank is bound to inquire whether it is a breach of trust
to authorize such trustee or trustees to draw checks upon the trust
account, and is not liable unless the circumstances be such that the
action of the payee or other holder or the bank amounts to bad faith.
In any case not provided for In this act, the rules of law and equity.
Including the law merchant and those rules of law and equity relating
to trusts, agency, negotiable instruments and banking, shall continue
to apply. (Acts Feb. 23, 1927, effective May 16, 1927).
Bills of Exchange and Promissory Notes. No grace is allowed.
Damages for protest on bills upon any person at any place out of
this State, but within the United States, 5 per cent on bills drawn
upon any person at any place without the United States, 10 per cent.
The Uniform Negotiable Instrument Law has been in force in Indiana
since 1913. (See Negotiable Instruments.)
Cognovit Notes. The execution, indorsement and procurement of
such notes, and the taking of judgment thereon otherwise than by
action of court upon a hearing after personal service upon the debtor,
are prohibited. (Act March 10, 1927, effective May 16, 1927).
Blue Sky Law (Enacted 1925). The Act known as the Indiana
Securities Law was approved February 27, 1925, and was effective
April 25, 1925. Provides for a Securities Commission. The Secretary
of State shall constitute the Securities Commission with plenary power
to administer the Act-


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Federal Reserve Bank of St. Louis

“Security” chad include any note, stock, treasury stock, bond,
debenture, evidence of indebtedness, transferable certificate of interest
or participation, certificate of interest in a profit-sharing agreement,
certificate of interest in an oil, gas, or mining lease, collateral trust
certificate, pre-organization certificate, pre-organization subscription,
beneficial Interest in a trust or pretended trust, any transferable share.
Investment contract, or beneficial interest in or title to property or
profits.
“Person” shall include a natural person, a corporation created
under the laws of this state or any other state, country, sovereignty,
or subdivision thereof, a partnership, an association, a joint stock
company, a trust, a syndicate, a firm, and any unincorporated organiza­
tion.
“Sale" shall include every disposition or attempt to dispose of a
security or interest in a security for value.
“ Dealer" shall include every person other than an agent, who in
this state engages either for all or part of his time directly or through
an agent in the business of selling any securities. The word “dealer”
shall not include a person having no place of business in this state,
who sells or offers to sell securities exclusively to a promoter or dealer
actually engaged in buying and selling securities.
Issuer” shall mean and include every person who proposes to issue,
has issued, or shall hereafter issue any securities. Any natural person
who acts as a promoter for and on behalt of a corporation to be formed
shall be deemed to be an issuer.
“Agent" shall include every natural person, other than a dealer,
employed or appointed or authorized by a dealer or issuer to seli
securities in any manner in this state.
This Act shall not apply to the following classes of securities:
(a) Any securities issued or guaranteed by the United States or
any territory or insular possession thereof, or by the District of Colum­
bia or by any state or political subdivision thereof, having the power
of taxation or assessment
(b) Any securities issued or guaranteed by any foreign government
with which the United States is at the time of the sale or offer of
sale thereof maintaining diplomatic relations.
(c) Any securities issued by a national bank or by any federal land
bank or joint-stock land bank or national farm loan association under
the provisions of the federal farm loan act of July 17, 1916, or by the
war finance corporation or by any corporation created or acting as
an instrumentality of the government of the United States.
(d) Any securities issued or guaranteed either as to principal.
Interest or dividend by a corporation owning or operating a railroad
or any other public service utility: Provided, that such corporation
is subject to regulation or supervision as to the issue of its own
securities by a public commission.
(e) Any securities issued by a corporation organized under the
laws of this state exclusively for educational, benevolent, fraternal,
charitable, or reformatory purposes, and not for pecuniary profit
(f) Securities appearing in any list of securities dealt in on the
New York stock exchange, or on any other recognized and responsible
stock exchange which has been previously investigated and approved
by the commission: Provided, however, that the commission may at
any time withdraw its approval of any such stock exchange or security
listed on the New York stock exchange.
(g) Any securities issued by a state bank, trust company, or savings
Institution incorporated under the laws of Indiana, and subject to the
supervision and control of the state government.
(h) Any securities issued by any corporation, organized under the
laws of this state authorized to deal in securities and whose holding
stock is owned solely and in the same proportion by the owners of the
stock of any national bank, or any state bank or trust company
incorporated under the laws of and subject to the examination, super­
vision and control of this state.
(i) Negotiable promissory notes or commercial paper.
(j) Capital stock issued by a corporation organized under the laws
of this state where no expense in excess of one per cent of the proceeds
from the sale of its capital stock to be presently issued is incurred
and no compensation or remuneration is paid, or given in connection
with the sale of such capital stock, and provided that no part of the
issue to be disposed of is issued directly or indirectly, in payment
for patents, services, good will, trade-marks, leases, copyrights,
processes, formulae or other intangible assets.
(k) Any securities which, under the laws of this state, are a legal
investment for savings banks or trust funds.
(l) Any securities secured by real estate or leasehold within th
state of Indiana, which is purchased for investment or resale by any
state bank, etc. subject to the supervision of the banking authorities
of the United States or the State of Indiana.
The Act does not apply to the sale of any securities at any judicial,
executor’s, administrator’s, guardian’s, or conservator’s sale, or at
the distribution by a corporation of capital stock, to its stockholders
as a stock dividend.
The transfer or exchange by one corporation to another of their
own securities in connection with a consolidation or merger of such
corporations.
No securities except those exempted shall be sold within this state
unless and until such securities shall have been registered by notifica­
tion or by qualification.
The following securities shall be entitled to registration by notifica­
tion:
Securities Issued by a corporation, partnership, association, etc.,
which has been in continuous operation not less than three years, and
which has shown during a period of not less than two years, nor more
than ten years, next prior to the close of its last fiscal year preceding
the offering of such securities, average annual net earnings.
Securities entitled to registration by notification shall be registered
by the filing by any registered dealer interested in the sale thereof in
the office of the Commission of a written statement containing the
following:
Name of issuer.
Brief description of the securities including the amount of the issue.
Amount of securities to be offered in the state.
Brief statement of the facts which show that the securities fall
within one of the notification classes.
The price at which the securities are to be offered for sale.
The filing of such statement in the office of the Commission and the
payment of the fee shall constitute registration of such security, and
such security when so registered may be sold in this state by any
registered dealer.
Applicants for registration shall pay to the Commission a fee of
one-twentieth of one per cent of the aggregate par value of the securi­
ties to be sold in this state, but in no case shall such fee be less than
$5.00 nor more than $150.00.
All securities required by this Act to be registered before being sold
in this state, and not entitled to registration by notification, shall
be registered only by qualification, as follows:
Applications shall be in writing and sworn to upon prescribed forms.
The applicant shall pay to the Commission a fee of one-twentieth
of one per cent of the aggregate par value of the securities to be sold,
but in no case shall such fee be less than $25.00 nor more than $200.00.
Upon application for registration by qualification, whether made
by an issuer or registered dealer, where the issuer is not domiciled
in this state, there shall be filed with such application the irrevocable

BANKING AND COMMERCIAL LAWS—INDIANA
written consent of the issuer that suits and actions growing out of
the violation of any provision or provisions of this Act may be com­
menced against it in the proper court, said consent agreeing that
such service of process shall be taken as valid and binding as If due
service had been made.
The Commission may revoke the registration of any securities upon
cause, and the Commission shall have access to and may compel the
production of all the books and papers of such issuer.
No dealer or agent shall engage in , he business of selling securities
until he had been registered and shall also file with his application
a bond in the sum of $5,000, said bond being executed by a surety
company of a net worth of not less than one million dollars.
The fees shall be $25.00 in the case of dealers and $5.00 in the case
of agents.
Registration may be refused such applicant or registrant upon
cause.
Nothing in this Act shall be construed to relieve corporation from
making reports now or hereafter required by law to be made to the
Secretary of State or any other state officer, or paying the fees now or
hereafter to be paid by corporations.
This Act shall not be construed to repeal any law now in force regu­
lating the organization of corporations or the admission of any foreign
corporations.
An appeal may be taken by any person interested from any final
order of the Commission to the Marion Circuit Court by serving upon
the Commission within twenty days from the entry of such order a
written notice of such appeal, and executing a bond in the penal sum
of $500.00
The Act approved July 26, 1920, and amendod March 9. 1921,
entitled An Act to Prevent Fraud in the Sale and Disposition of Stocks,
Bonds, and other Securities and real estate in certain cases in the Si ate,
of Indiana,” and all acts and parts of acts in conflict herewith are
hereby repealed as of the date of the taking effect of this act.
Chattel Mortgages. Chattel mortgage on personal property left
in the hands of the mortgagor with power to sell musi stipulate that
the money received by the sale be applied to the payment of the
mortgage debt, and should be drawn in the form of an absolute bill
of sale, must be acknowledged in the same manner as prescribed for
the acknowledgments of deed, and recorded within ten days from
execution, and in the county where the mortgagor resides. An
assignment of goods, by way of mortgage, where such goods are not
delivered to the mortgagee, shall not be valid against any other person
than the parties thereto, unless such mortgage shall be acknowledged,
and recorded within ten days after the execution thereof
Where
delivery of the chattels to the mortgagee occurs at the time, record
Is unnecessary. A mortgagee of household goods can not sell mort­
gaged property except under a judicial proceeding in the circuit or
superior court. For certain restrictions on the lending of money
on mortgage of household goods, see the statutes.
Conveyances. All conveyances, mortgages or leases for more than
three years shall be recorded and take priority according to time of
filing as against good faith purchaser, lessee or mortgagee
hands in
this State may be taken, held, conveyed, devised, or passed by
descent, by or from any citizen of the United States, or by or from
any alien (see Aliens), with some provided exceptions as to descent
or devise. Lands which may have come by descent or purchase to
the wife of an alien, may be held, conveyed, devised and passed by
descent by and from her, notwithstanding the fact of her residence
with her husband in a foreign state or country.
Except bona-flae leases for a term not exceeding three years, con­
veyance of lands, or of any interest therein, must be by deed, sub­
scribed, and acknowledged by the grantor or by his attorney in fact.
The joint deed of a husband and wife is sufficient to pass the lands
of the wife. Except in cases of mortgages, conveyances in trust,
conveyances to husband and wife, and cases of estates vested in
executors or trustees, as such, and so held by them in joint tenancy,
all conveyances and devises of lands, or of any interest therein made
to two or more persons, shall be construed to create estates in com­
mon, and not in joint tenancy, unless it shall be expressed therein
that the grantees or devisees shall hold the same in joint tenancy
and to the survivor of them, or it shall manifestly appear from tenor
of instrument, that it was intendea to create an estate in joint tenancy.
A deea or release or quit-claim shah pass all the estate which the
grantor could convey by a deed of bargain and sale. If it be the
intention of the grantor to convey any lesser estate it must be so
expressed in the deed. Liability on lineal and collateral warranties
is expressly abolished: a covenant or agreement of any person leaves
heirs and devisees answerable thereon only to the extent of property
descended or devised to them. Any conveyance of land worded—
“A. B. conveys and warrants to O. D. (here describe the premises)
for the sum of (here Insert the consideration),” or “A B quit-claims
to C. D. (here describe the premises) for the sum oi (here insert the
consideration),"—the same being dated, and duly signed and acknowl­
edged by the grantor,—shall, in the one case, be a conveyance in fee
simple to the grantee, his heirs and assigns, with covenant from the
grantor for himself and his heirs and personal representatives that
he is lawfully seized of the jiremises. has good right to convey the
same, and guarantees the quiet possession thereof, that the same are
free from all incumbrances, and that he will warrant and defend the
title of the same against all lawful claims; and shall, in the other
case, be deemed to be a good and sufficient conveyance in quit-claim
to the grantee, his heirs and assigns. Any mortgage of lands worded
—"A. B. mortgages and warrants to C. D. (here describe the premises)
to secure the repayment of (here recite the sum for which the mortgage
is granted or the note or other evidences of debt, or a description
thereof, sought to be secured, also the date of the repayment"—the
same being dated and duly signed and acknowledged by the grantor
—is a sufficient mortgage to the grantee, his heirs, assigns, executors
and administrators, with warranty from the grantor and his legal
representatives of title perfect and unincumbered in the grantor.
When a deed purports to convey absolutely any estate in lands, but
is made, or intended to be made, defeasible by force of a deed of
defeasance, bond or other instrument for that purpose, the original
conveyance shall not thereby be defeated or affected as against any
person other than the maker of the defeasance, or his heirs or devisees,
or persons having actual notice thereof, unless the instrument of
defeasance shall have been recorded, according to law within ninety
days after the date of said deed. Every conveyance or mortgage of
lands, or of any interest therein, and every lease for more than three
years, shall be deemed fraudulent and void as against any subsequent
purchaser, leasee or mortgagee in good faith and for a valuable con­
sideration. unless recorded in the recorder's office of the county where
such lands are situated. (See Acknowledgments. Married Women.)
When either the husband or wife is of unsound mind the party
with the sound mind can either join in the guardian's deed or make
his separate deed and the effect would be the same as a joint deed of
husband and wife both of whom are of sound mind.
Collections. Uniform Bank Collection Code as recommended by
American Bankers Association, see page 2333.
Corporations. Three or more persons may form a corporation for
any lawful purpose by filing articles of association with the Secretary
of State and the Recorder of the County. Special charters are neces­
sary for banks, building and loan associations, insurance, security,
railroad, telegraph, telephone, turn-pike company, etc. The liability
of stockholders varies. In banking corporations the stockholder is
responsible not only for his original subscription, but for an amount
equal thereto. In all other corporations he is liable for the subscription
price of his stock.
A corporation act was passed by the legislature in 1929, which gives
great liberality. A corporation may change its powers, increase or


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decrease its capital stock, change the par value of any class or classes
of shares of its capital stock with par value, change the number of its
outstanding shares of any class of stock into different numbers of
shares of said class, increase its Board of Directors, fill vacancies therein,
hold its meetings within or without the state, transfer its stock free
of taxes and must report but once each year to the Secretary of State.
This report is merely a formal one giving amounts of stock outstanding,
list of officers, etc. The corporation is assessed for local taxes upon the
value of its holdings within the State of Indiana and only upon such
holdings.
Foreign corporations, or their agents, before entering upon the
duties of their agency in this State shall deposit in the Clerk's office of
the County where they propose doing business the power of attorney
and appointment under which they act. They shall also file with the
Secretary of State an application to do business in the State of Indiana,
naming a resident agent therein. Foreign corporations shall pay a fee
of Twenty-five Dollars on the first Ten Thousand Dollars of assets in
Indiana and Ten ($10.00) Dollars for each additional One Thousand
Dollars. It must file annual reports the same as the local corporation.
Courts and Jurisdiction. Circuit Courts in all counties, original
general jurisdiction in all civil causes, original general jurisdiction in
all criminal causes, except in the counties of Lake and Marion in
which there are criminal courts, probate jurisdiction, except in Marlon
County which has a probate court, except in Allen County which has
Allen superior court No. 2, probate exclusive and concurrent juris­
diction in civil matters, also appellate jurisdiction in appeals from
Justices of Peace, Mayors of cities and Board of County Commissioners.
Superior Courts are established in many counties with original con­
current jurisdiction with the circuit courts in all causes except slander
and libel, criminal causes, probate matters and concurrent appellate
jurisdiction with circuit courts. Justices of the Peace in all town­
ships, jurisdiction in civil actions for *200.00 or less, in the township,
also jurisdiction in petty criminal causes. Party may confess judg­
ment in Justice’s court for *300.00. In actions on written obligations
for money of more than one party Justice has jurisdiction in township
where either party resides and may issue process to any county in
the state for other parties. Supreme Court is highest appellate
court and has no original jurisdiction except in a few specified cases.
Appellate Court has final appellate jurisdiction in many cases, no
original Jurisdiction. In some specified classes of cases defeated
party may have cause transferred to Supreme Court. Both Supreme
and Appellate Courts sit only in Indianapolis. Municipal (Court,
Marion County (Indianapolis), four judges. Original jurisdiction
concurrent with Superior and Circuit Courts in all civil cases founded
on contract or tort in which debt or damage or value of property
sought to be removed does not exceed *500. Jurisdiction irrespective
of value of property in possessory actions between landlord and
tenant. Criminal jurisdiction as is now vested in city courts in cities
of first class. Jurisdiction in cases involving violation of ordinances
of cities and towns or other municipalities.
Courts of record within their respective jurisdictions shall have
power to declare rights, status, and other legal relations whether or
not further relief is or could be claimed.
Any person interested under a deed, will, written contract or other
writings constituting a contract, or whose rights, status or other legal
relations are affected by a statute, municipal ordinance, contract or
franchise, may have determined any question of construction or
validity arising under the instrument, statute, ordinance, contract, or
franchise and obtain a declaration of rights, status or other legal
relations thereunder.
A contract may be construed either before or after there has been
a breach thereof
Any person interested as or through an executor, administrator,
trustee, guardian or other fiduciary, creditor, devisee, legatee, heir,
next of kin. or cestui que trust, in the administration of a trust, or of
the estate of a decedent, infant, lunatic, or Insolvent, may have a
declaration of rights or legal relations in respect thereto.
The court may refuse to render or enter a declaratory judgment or
decree where such judgment or decree, if rendered or entered, would
not terminate the uncertainty or controversy giving rise to the pro­
ceeding.
All orders, judgments and decrees under this act may be reviewed
as other orders, judgments and decrees. (Act March 5, 1927, in effect
May 16. 1927).
Days of Orace are no longer recognized.
Depositions. Depositions may be taken anywhere In the United
States without a commission, before any judge, justice of the peace
notary public, mayor, or recorder of a city, clerk of a court of record,
or commissioner appointed by the court to take depositions
Per­
son taking deposition must not be of kin to either party or interested
in the action. When taken outside of the United States they shall
be taken pursuant to an order of the court, under a commission, with
such reasonable notice of the time and place of taking the same as
the court shall require, and they shall be certified and returned by
the commissioner in such manner as the court shall direct Notice
of the taking of the deposition should be served upon the adverse
party or his attorney, specifying the cause, the court or tribunal of
trial, the time and place of taking, and the names of the witnesses.
Reasonable time shall be allowed for the attorney so served to com­
municate with the client, and for travel to the place of taking exclud­
ing the day of service, of the taking and Intervening Sundays. The deonent shall be first sworn according to law He shall then be examined
y the party producing him, and then by the adverse party, and then by
the officer, if he see cause. The deposition shall be written down by the
officer by the deponent, or by some disinterested person, in the presence
and under the direction of the officer, and after the same has been
carefully read shall be subscribed by deponent. The following facts
shall be stated in a certificate to be annexed by the officer
I. That
the deponent was sworn according to law. 2. By whom the depo­
sition was written, and if written by deponent or some disinterested
person, that it was written in the presence and under the direction of
the officer 3. Whether the adverse party attended. 4. The time
and place of taking, and the officer shall sign and attest the certificate,
and seal the same, if he have a seal of office. If he have no seal, his
certificate shall be authenticated by the certificate and seal of the
clerk or prothonotary oi any court of record of the county In which
certificate shall be authenticated by the certificate and seal of the
clerk or prothonotary of any court of record of the county in which
the officer exercises the duties of his office. The officer taking the
deposition shall seal the same in a sufficient envelope and himself,
post, or express, or deliver the same to the clerk, of the court in which
the action is pending, endorsing on the envelope the names of the
parties and of the court and of the witnesses whose depositions are
enclosed
Adjournments may be had from day to day after the
deposition has been begun, and for longer periods, upon written con­
sent of the parties, which written consent must be attached to the
deposition. Adjournments should be noted at the place in the
deposition when they occur. A narrative form may be used. A
witness identifying a written instrument should attach it to his
deposition, making it a part of his answer.
Descent. The real and personal property of any Intestate shall
descend to his or her children equally; and posthumous children
Inherit equally with those born before the death of the ancestor.
Children of deceased children take the share which would have
descended to the father or mother and grandchildren, and more
remote descendants, and other relatives, lineal and collateral, inherit
by the same rule, excepting that if the heirs are all grandchildren
they inherit equally. Where there are no heirs as aforesaid, onehalf of the estate goes to the father and mother as joint tenants, or
to the survivor, and the other half to the brothers and sisters, and
to the descendants of such as are dead, as tenants in common. If

2170

BANKING AND COMMERCIAL LAWS—INDIANA

there be neither father nor mother, the brothers and sisters, and
the other descendants, take the estate as tenants in common; or.
per contra, the father and mother as joint tenants of the survivor.
Kindred of the half-blood inherit equally with those of the wholeblood in property purchased by the ancestor; otherwise, as to property
acquired by gift, devise, or descent. Illegitimate children inherit
from the mother same as if they were legitimate, and vice versa.
Tenancy by the curtesy ana dower are abolished, ana widows take
one-third of the real estate in fee simple, unless the property is worth
over $10,000, in which case, as against creditors, she takes one-fourth
only; and where the real estate is worth over $20,000, one-flftb only
as against creditors, but as against other heirs she takes one-third
In fee simple, regardless of value, except where there is but one
child, in which case each inherits one-half. A second or subsequent
wife, however, takes only a life estate in her husband’s lands, if there
be a child or children by a previous marriage, and none by such
widow. Other special provisions of the statute are too extensive to
set out. The estate of a person dying intestate without kindred
capable of inheriting will escheat to the State for the support of the
common schools.
Dower. (See Married Women.)
Executions may issue at any time within ten years after judg­
ment and are returnable in 180 days. From a court of record may
Issue to any county in the State. Are a lien on personal property
within the county from the time they are placed in hands of officer.
The liens upon personal property attach in the order in which the
officer receives them. When levy is upon real estate the dates of
the judgment control the right to participate in the proceeds, and
they must be applied according to their priority. Personal property
taken in execution may be left with execution defendant by the
giving to the officer of a delivery bond with sufficient surety; debtor
may. by giving sufficient freehold sureties, have a stay of execution
on any sum exceeding $100, for six months. Where the sum is less
than $100, the stay is not so long, varying with amount of judgment.
Lands sold under execution may be redeemed within one year by
the owner, mortgagee or person having a lien thereon, the owner
retaining possession during the redemption year and being liable for
reasonable rents and profits in case of failure to redeem.
Exemptions. Property up to $600 is exempt in suits on contract
where debtor is a resident householder. Resident householder is
entitled to exemption as well when in transit with his family and
property as when permanently settled. The debtor must file a sched­
ule of all of his property, and select the property claimed, which is
then appraised. Contract waiving exemption is void. Pension
money in transit to pensioner is exempt, but when received by him
and invested in other property is no more so than any other property.
One month’s wages also exempt if the debtor is still employed.
Fraud. Assignments, in writing or otherwise, of any property
made or suffered with intent to hinder, or defraud are void as to the
persons defrauded. The question of fraudulent intent is a question
of fact.
Frauds—Statute of. The following contracts, if enforceable In court,
must be in writing and signed by the party to be charged: 1. To
charge an executor or administrator, upon any special promise, to
answer damages out of his own estate. 2. To charge any person,
upon any special promise, to answer for the debt, default, or mis­
carriage of another. 3. To charge any person, upon any agreement
or promise, made in consideration of marriage. 4. Upon any con­
tract for the sale of land (except loan not exceeding the term of three
years). 5. Upon any agreement not to be performed within one
year from the making thereof. 6. Sale of goods exceeding $50 in
value, unless part payment or part delivery be made. 7. Upon
any representation made concerning the character, conduct, credit,
ability, trade or dealings of any other person.
Garnishment. If at the time an order of attachment issues, or at
any time before or afterwards, the plaintiff, or other person in his
behalf, shall file with the clerk an affidavit that he has good reason to
believe that any person named has property of the defendant in his
possession or under his control, which the sheriff cannot attach by
virtue of such order; or that he is indebted to the defendant, or has
control or agency of any money, property, credits or effects; or that
defendant has any shares or interest in the stock of any association or
corporation, the clerk shall issue a summons to such person, corpora­
tion, or association, to appear and answer as garnishee in the action.
From the service of summons the garnishee is accountable to plaintiff
for the money, property, etc., in his hands, or due to defendant. If
the summons issues before attachment, the affidavit must show some
one of the causes authorizing attachment. The garnishee is required
to furnish the sheriff, within five days after service, a certificate of
the property, etc., of defendant in his hands or due to him, to be
returned with the summons. If he fails or refuses the court may
require him to appear and be examined under oath, or proceed against
him on default to judgment. If it appear by affidavit that a garnishee
is about to abscond before judgment can be had, an order of arrest
may issue and he be held to special bail. Return of “No property
found” on an order of attachment does not affect the proceedings
against the garnishee. He may, before judgment against the de­
fendant, by delivery of all the defendant’s property in his possession
to the sheriff, or payment of all money due him to the sheriff, or into
court, discharge himself from the suit without costs, and from all
liability to the defendant or the money or property so paid or de­
livered, not exceeding the plaintiff’s claim.
Clerks of the circuit courts, sheriffs, justices of the peace, constables
and all other officers who may collect money by virtue of their office,
executors, administrators, guardians, and trustees, are subject to
garnishment as other persons.
The wages of all householders In the employ of any person or
corporation are exempt from garnishment and proceedings supple­
mental to execution, in the hands of the employer, so long as the
employee remains in such employment, not exceeding twenty-five
dollars at any one time, and the employee is allowed no other exemption
as against garnishment. (Burns’ Ann. S. 1926, § 985.)' Applies to
householders in other jurisdictions. Resident householders still have
six hundred dollars exemption. (Pomeroy v. Beach, 143 Ind. 511.)
See also 15, 47, 50, 71, 114.
Holidays. (See Legal Holidays.)
Husband and Wife. (See Married Women.)
Inheritance Tax. (See Taxes.)
Interest. The legal rate is 6 per cent, but interest may be taken
In advance. No agreement to pay a higher rate is valid unless the
same be in writing, and in such case it is not lawful to contract for
more than 8 per cent. When a greater rate is contracted for, the
contract is void as to all interest in excess of 6 per cent, is usurious
and illegal, and the excess may be recouped by the debtor whenever
It has been reserved or paid before the bringing of the suit. Interest
on judgments runs from the date of the verdict or finding, at the
rate specified in the original contract, not exceeding 6 per cent, and
if no contract has been made 6 per cent is allowed.
Judgments of courts of record are a lien upon all real estate of
defendant within the county for ten years. Judgment may be
obtained at the first term of the court, after process has been served
on debtor ten days prior to the first day thereof. Judgment in justice
court becomes a lien on real estate of judgment defendant! rom time
of filing a transcript in office of the clerk of circuit court. A certified
copy of any judgment rendered by the District Court of the United
States for district of Indiana may be filed with the county clerk.
Legal Holidays as to commercial paper are as follows; The first
day of the week, commonly called Sunday; the 1st day of January;
the 4th day of July; the 25th day of December; any day appointed
by the president or governor for public fasting or thanksgiving; 12th
lay of February; 22d day of February; 30th day of May; first Mon­


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day of September; 12th day of October; and any election day; when
any holiday (other than Sunday) comes on Sunday the Monday next
succeeding shall be the legal holiday; Saturday afternoon is a legal
half-holiday in the city of Indianapolis and may be made so by act
ef bankers in other cities of over 35,000 population.
Liens. Liens are granted by statute to attorneys; to persons
holding claims against watercraft on account of supplies furnished or
work done; also for demands for damages arising out of freight con­
tracts, or for willfulness or negligence of the master, owner, or agent,
or out of any contract relating to transportation, and for injuries to
persons or property; also to employes of any corporation as against
any of its corporate property or earnings for labor done; also to
keepers of livery stables and all persons engaged in feeding stock, for
the feed and care bestowed upon the same, also to blacksmiths; also to
contractors, sub-contractors, mechanics, journeymen, laborers, and all
persons performing labor or furnishing material or machinery for
erecting, laboring, repairing or removing any house, mill, manufactory
or other building, bridge, reservoir, system of water-works, or other
structure, known as a mechanic's lien; also to bailees and tradesmen
for their valid and reasonable charges in the construction, repair,
or alteration of any article of value; also to the bailee or keeper of
personal property for any feed or care bestowed by him upon such
property; special lien for storage or repair of motor vehicles; also to
forwarding and commission merchants on goods which may have
remained in store for one year or more- also to all persons, firms
and corporations engaged in the business of storing, warehousing and
forwarding, goods remaining in possession of such person, firm or
corporation for more than six months may be sold at public auction
to pay amount of lien; also to landlords upon crops. Persons storing,
furnishing supplies or repairing a motor vehicle or garage owners
have lien on motor vehicle which can be foreclosed within one year
from failure of owner to pay charges. Judgments rendered in any
county in the State are a lien upon the real estate situated in such
county for a period of ten years from the rendition thereof, and judg­
ments rendered in the federal courts are a lien upon any real estate
In the State for the same period. Provision is made by statute, how­
ever, for the filing in the county where the real estate is situated of a
transcript of any judgment rendered in the United States courts.
The office of the clerk of the circuit court in each county contains a
public record known as the lis pendens record, in which notice of the
filing of complaints to enforce liens are required to be recorded, and
also in cases where real estate is seized by attachment or execution
Unless so recorded the bringing suits does not operate as a constructive
notice
Limitations to Stilts. Actions for injury to person and character,
and for statutory penalty or forfeiture, two years; against public
officers relating to their official duties, and on public improvement
assessments, five years; open accounts and contracts not In writing,
for use, rents and profits of real estate, injuries to and detention of
property, recovery of personal property and relief against frauds, six
years; upon promissory notes, bills of exchange and other written
contracts for payment of money, ten years; actions not limited by
statute, fifteen years; other written contracts, judgments of courts of
record and real actions, twenty years. Revivor: part payment or
new promise in writing. Except in favor of sureties, the statute of
limitations does not run against the State.
Married Women control their real and personal property. The
husband is liable for the wife’s debts contracted before marriage to
the extent of the personal property he may receive from her, and no
further, and her lands are liable for such indebtedness. A married
woman may devise her separate estate; may sell and transfer her separ­
ate personal property; carry on any business, labor, or service, and
receive the earnings accruing therefrom; enter into any contract in
regard to her separate personal estate business, labor, or service, and
her separate estate, real and personal, be liable therefor, the same as a
femme sole; and her husband is not liable for such debts, nor for
Indebtedness created by the wife tor improvement of her separate
real estate. She can make leases of real estate for terms of three
years or less, and execute mortgages to secure purchase money, with­
out husband joining. She is bound by covenants of title in convey­
ances of her separate real estate. Her deed conveying her real estate,
her husband not joining, is absolutely void. She may sue as a femme
sole for any damage to her person or character. She is bound in
like manner as principal on her official bond. Disability as to surety­
ship has been abolished, therefore, In making loans to married women
it is not necessary for her to make an affidavit that the money used
Is for her own benefit. She is entitled to hold as exempt from execu­
tion in any suit on contract property to the amount of $600. A widow
takes one-third of her deceased husband’s real estate in fee, and free
from all demands of creditors, where the estate does not exceed $10,000;
one-fourth, if under $20,000, and one-fifth, if above that amount.
She also takes a child's interest in the personality where the number
of children does not exceed two, and where there are more than two,
her interest shall not be less than one-third of the whole of personalty
after payment of debts, and in all cases takes $500 without accounting,
and may occupy the dwelling of forty acres of her husband’s land for
a year, rent free. But the one-third of her real estate which the
widow takes in fee, can not, upon her marrying again, be effectively
conveyed or mortgaged by her, if there be a minor child or children, or
their descendants, alive by the previous marriage. Real estate which
husband and wife hold by title made to them as husband and wife,
is held as an estate by entirety; it cannot be taken for the debt of
either; is not subject to the lien of a judgment against either, except
in case of the death of either or upon divorce granted, when the estate
is destroyed and becomes subject to levy and sale; and a mortgage
thereof by them both for a debt of the husband has no legal validity.
Mortgages. (See Conveyances.)
Negotiable Instruments are defined by Chapter 63 of the Acts
of 1913 which is the Uniform Negotiable Instrument Act. Section 1
provides that an instrument to be negotiable must conform to the
following requirements:
1. It must be in writing and signed by the maker or drawer.
2. Must contain an unconditional promise or order to pay a cer­
tain sum in money.
3. Must be payable on demand, or at a fixed or determinable
future time.
4. Must be payable to order or to bearer.
5. Where the instrument is addressed to a drawee, he must be
named or otherwise indicated therein with reasonable certainty.
Its negotiability is not affected by a provision which authorizes
the sale of collateral securities in case the instrument is not paid at
maturity, or authorizes a confession of judgment if the instrument
be not paid at maturitv, or waives the benefit of any law intended for
the advantage of the obligor, or gives the holder an election to require
something to be done in lieu of the payment of money.
To charge Indorser notice of non-payment must oe given to him at
once unless waived by him.
Every negotiable instrument is payable at the time fixed therein
without grace. Where day of maturity falls on Sunday or a holiday.
Instrument is payable on next succeeding business day. Instruments
payable on Saturdays are to be presentea for payment on next succeed­
ing business day. except that demand instruments may be presented
for payment before noon Saturday when that entire day is not a holiday.
In any case not provided for in the act the law merchant governs,
and all laws in conflict are repealed.
Act does not apply to negotiable instruments made and delivered
before April, 1913.
Power of Attorney must be executed and acknowledged, and (If
for the conveyance of real estate, or to affect real estate) recorded, in
the same manner that deeds are made.

BANKING AND COMMERCIAL LAWS—IOWA
Probate Law. (See Administration of Estates.)
Protest. The statutory damages on such protest are 5 per cent
on the principal of a bill of exchange, if drawn or negotiated within
this State, upon any person, at any place out of this State, but within
the United States, and 10 per cent if upon any person, at any place
without the United States.
Replevin. When any personal property is wrongfully taken or
unlawfully detained, or. if taken on execution or attachment, is
claimed by a third party, the owner or claimant may bring an action
for possession thereof. He may claim immediate delivery upon
affidavit therefor, whereupon the sheriff takes possession of the
property, and if delivery bond is given on behalf of the defendant
within twenty-four hours, the property is returned to him. otherwise
the plaintiff may give bond and take the property: failing to do so
It is returned to the defendant. The plaintiff has twenty-four hours
In which to file bond. Justices of the peace have jurisdiction in
replevin suits involving property worth $200 or less. Procedure is
same before justice of the peace, except that the plaintiff must file
bond in all such cases. Replevin may also be had without bond, by
allowing defendant to retain possession of property pending suit.
Suits. (See Actions.)
Taxes. The general tax law of Indiana was revised and codified
by the acts of 1919, p. 198. Personal property is listed for taxation
between the first day of March and the 15th day of May of each year,
with reference to the quantity held or owned on the first day of March
in the year for which the property is required to be listed. Realty is
listed and assessed by the township assessor. Assessment lists of
personal property are filed with the township assessor. Prom the
assessment of the township assessor, an appeal may be taken to the
county assessor and the county board of review. An appeal lies from
the county board to the State Tax Board. Thereafter illegal taxes
will be enjoined by the courts in accordance with the usual rules of law.
Valuation. All property must be assessed and valued for taxation
purposes at the true cash value thereof. (14034).
Liens. Taxes attach as a lien on real estate on March 1 each year.
The lien is perpetual and is not divested by any sale or transfer. The
first half of taxes becomes delinquent if not paid on the first Monday
in May of the succeeding year, and the second half on the first Monday
of November following. (14288-95).
Sales. If not paid by the first Monday of February following, the
property, or so much thereof as may be necessary, will be sold for the
payment of taxes and penalty. Sales of real estate for taxes are made
on the second Monday in February, annually. (14300-10).
Redemption. The property may be redeemed within 6 months
by payment of the amount bid at the sale, with 10 per cent penalty;
if redeemed after 6 months and within 12 months, the penalty is
15 per cent; after 12 months and within 2 years, 25 per cent; at the
expiration of which time the purchaser is entitled to a deed, and no
redemption may thereafter be made. But infants and insane persons
may redeem within 2 years after removal of their disability. A tax
deed may be set aside if any substantial provision of the law has not
been complied with, and redemptions are generally favored by the
courts, even after a deed has issued. (14311-24).
Exemptions. The property of the U. S. and of this state, and the
property of any county, city, town or township is exempt from taxa­
tion. Generally, and under certain conditions, the following property
is exempt from taxation: property used for educational, literary,
scientific, religious, fraternal, benevolent, or charitable purposes,
battle grounds, and other historic sites and public libraries. Ceme­
teries incorporated under the law of this state, not for pecuniary
profit, and certain funds for the care and maintenance of cemeteries,
are exempt. Members of the state militia and every soldier and
sailor in the service of the U. S. are exempt from paying poll or road tax.
All bonds, notes and other evidences of indebtedness issued by the
state or by municipal corporations within the state upon which the
state or said municipal corporation pays interest are exempt. All
bonds authorized by any county or township of the state for the
purpose of building or constructing any free gravel or other improved
roads are exempt, provided said bonds do not bear a greater rate of
interest than 5 per cent. All bonds and other evidences of indebtedness
hereafter issued by or in the name of any municipality or other political
or civil subdivision of this state, or by or in the name of any taxing
district in this state, for the purpose of paying the cost of improvement
or maintenance of streets, highways, etc., and other improvements of
public benefit, and which bonds, or other evidence of indebtedness are
payable from special assessments or special taxes, are exempt from
taxation. (14037).
Inheritance Tax. (1929, c. 65). Tax is imposed, subject to
conditions and limitations, on all transfers in trust or otherwise of the
following property or interests therein or income therefrom: When
transfer is from a resident of state, real property situated in state, all
tangible personal property except such as has an actual situs without
state and all intangible personal property wherever situated; when
transfer is from a nonresident, all real and personal property within
jurisdiction of state.
The following transfers are taxable: By will; by statute regulating
descent: made in contemplation of death of transferor: made by gift
or grant to take effect in possession or enjoyment after death of
transferor; made in payment of debt created by antenuptial agree­
ment by its terms payable by will or contract at or after death. If
transfer is for a valuable consideration and love and affection, no tax
is imposed on the value up to the money value of the consideration
received by the transferor, but the excess is taxed. Where property
is held in joint names of 2 or more persons as joint tenants or other­
wise, or is deposited in banks, etc., in joint names and payable to
survivor or survivors, exercise of right of survivor or survivors is a
taxable transfer, and portion represented by dividing total property
by number of joint owners is taxed, except such as may have belonged
originally to survivor or survivors and never have belonged to decedent.
Proceeds of insurance on decedent’s life, payable to his estate, are
taxed; but insurance payable to some other person and not a part of
decedent’s estate is not taxed. A transfer by deed of trust (before or
after enactment of statute) wherein trustor reserved to himself any
income or interest, or reserved powers of revocation, alteration or
amendment, on exercise of which property would revest in him, is
taxable on his death to extent of value of property subject to such
powers and as to which such powers have not been exercised. Prop­
erty transferred to executors or trustees in lieu of commissions, allow­
ances or fees, is taxable on excess over commissions, etc., which would
be payable in absence of any such transfer.
Rates of tax and exemptions vary according to relationship of
beneficiary and amount of transfer, as follows:
Class A. Husband, wife, lineal ancestor or descendant, legally
adopted child and child to whom transferor stood in acknowledged
relation of parent and child for not less than 10 years prior to transfer.
Exemptions: Wife, $25,000; minor child, $10,000; other members of
class, $5,000. Rates: 1 per cent up to $50,000; 2 per cent on excess
to $100,000; 3 per cent on excess to $200,000; 4 per cent on excess to
$300,000; 5 per cent on excess to $500,000; 6 per cent on excess to
$700,000; 7 per cent on excess to $1,000,000; 8 per cent on excess to
$1,500,000; 10 per cent on excess.
Class B. Brother, sister or descendant of either, son-in-law and
daughter-in-law. Exemption, $500. Rates: 5 per cent up to $100,000;
8 per cent on excess to $200,000; 10 per cent on excess to $500,000;
12 per cent on excess to $1,000,000; 15 per cent on excess.
Class C. All others. Exemptions, $100. Rates: 7 per cent up to
$100,000; 10 per cent on excess to $200,000; 12 per cent on excess to
$500,000; 15 per cent on excess to $1,000,000; 20 per cent on excess.


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2171

Rates above stated apply to entire transfer in excess of exemption.
Following transfers are entirely exempt: To U. S. ,any state or
territory or political subdivision thereof, or any corporation, in­
stitution, association or trust formed for charitable, educational or
religious purposes, provided property is to be used exclusively for
such purposes in Indiana.
Tax is imposed on full, fair cash value of property, subject to
exemptions above stated in case of transfers by will or intestate laws.
Tax is payable at time of transfer and is a lien against the land
Trustees, executors or administrators of estates are personally liable
for the tax.
Tax is determined by any court having probate jurisdiction, on
appraisement by county assessor, or by inheritance tax appraiser in
counties of 200,000 or more population. Provision is made for notice
of appraisement, hearing upon report and rehearing to persons in­
terested or State Board of Tax Commissioners. The Board may move
for a rehearing within 2 years after entry of delivery by the court if
they believe appraisement was fraudulently, collusively, or erroneously
made.
Tax on resident decedent’s estate is payable to treasurer of county
where court having jurisdiction is situated. If paid within 1 year
after accrual, deduction of 5 per cent is allowed; if not paid within 18
months, interest at 10 per cent from date of accrual is assessed.
Determination of tax on taxable transfers from nonresidents is
under exclusive jurisdiction of Tax Commissioners. Appeal from
appraisement lies to Marion county circuit court. Tax is payable to
State Board of Tax Commissioners. Taxes erroneously assessed may
be refunded on order of State Auditor and approval of Tax Com­
missioners. Person or institution permitting stock or personal prop­
erty or securities to be transferred without consent of Tax Com­
missioners is liable for the tax and subject to penalty of not more than
$1,000 in addition.
In case of contingent or expectant estate where taxes are not
presently payable, Tax Commissioners and Attorney General may
enter into agreement with trustees, executors or administrators to
compound taxes and grant discharges therefor. If agreement cannot
be reached, tax is held in abeyance and trustees, executors or admin­
istrators must give bond for prompt payment.
State Board of Tax Commissioners is charged with enforcement of
the act and will provide forms required.
Wills. No will except a nuncupative will shall affect any estate
unless it be in writing, signed by the testator or by someone in his
presence, with his consent, and subscribed in his presence, by two or
more competent witnesses in the presence of each other. A will made
before marriage becomes void on marriage of testator. No nun­
cupative will shall be valid when more than the value of $100.00 is
bequeathed, nor unless it Is made in the last sickness of the testator,
and the subject thereof be reduced to writing within fifteen days after
it shall have been declared and proved by two competent witnesses
who shall have heard the testator, in effect, request some of those
present to bear witness thereto; and no such nuncupative will shall be
proved after six months from the death of the testator, nor until his
widow and heirs shall have reasonable notice of the time and place of
proving the same
Any soldier or sailor in actual service may dispose
of his personal estate, in his actual possession, and his wages, by a
nuncupative will. Any person may contest the validity of any will
or resist the probate thereof at any time within one year after the will
has been offered for probate. Upon the death of any testator any
person interested in any part of the estate specified in the will may
have the will probated. A will in writing shall be proven by one or
more of the subscribing witnesses, or, if they be dead, out of the state,
or have become incompetent from any cause since attesting the will,
then by proof of the handwriting of the testator or of the subscribing
witnesses thereto.

SYNOPSIS OF

THE LAWS OF IOWA
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Maxwell a Rtan, Attorneys at Law. Suite 912
Valley National Bank Bldg., Des Moines, Iowa
(See Card in Attorneys’ List.)
Accounts. In all instances where any sum of money is claimed
on an account, the same must be itemized. If suit is brought on
such an account the items thereof must be consecutively numbered
and the account must be sworn to. Such a sworn statement of
account together with a petition which has been likewise sworn to,
constitutes a prima facie case enabling the creditor to take judgment
thereon in the event the debtor is unable to disprove the items.
Acknowledgments. All instruments affecting real estate, includ­
ing mortgages, deeds of trust, powers of attorney relating theretof,
and leases for more than one year, must be acknowledged or the
execution thereof proved and the instruments must be recorded in
the proper office, in order to affect third parties. The same is also
true as to bills of sale of personal property. Conditional sales contracts
or leases must be signed by both vendor and vendee, or lessor and lessee
and acknowledged by one of them, and must be filed the same as
chattel mortgages (see Chattel Mortgages). Articles of incorporation
must also be acknowledged and recorded. Forms of acknowledgments
are prescribed by statute, and must be substantially as follows:
1. In the case of natural persons acting in their own right:
State of...............................lKn
County of.......................... JS8‘
On this day............of............ A. D. 19.., before me................................
(Insert title of acknowledging officer)................to me known to be the
person. . named in and who executed the foregoing instrument, and
acknowledged that............executed the same as............ voluntary act
and deed.
Notary Public in and for said County
2. In the case of natural persons acting by attorney:
State of...............................1
County of.......................... j
On this........... day of.............. A. D. 19. ., before me...............................
(Insert title of acknowledging officer)........... , personally appeared....
to me known to be the person who executed the foregoing instrument
in behalf of.............................., and acknowledged that he executed the
same as the voluntary act and deed of said...........................................
Notary Public in and for said County

2172

BANKING AND COMMERCIAL LAWS—IOWA

3. In the case of corporations or joint stock associations:
State of. .
|ss.
County of
On this........... day of............ A. D., 19... before me, a.... (Insert
title of acknowledging officer)............. in and for said county, person­
ally appeared.................................... to me personally known, who being
by me duly (sworn or affirmed) did say that he Is........... (Insert title
of executing officer)........... of said (Corporation or association).............
that (the seal affixed to said instrument is the seal of said) or (no
seal has been procured by the said) (corporation or association) and
that said instrument was signed and sealed on behalf of the said
(corporation or association) by authority of its board of (directors or
trustees) and the said........................................... acknowledged the execu­
tion of said instrument to be the voluntary act and deed of said
(corporation or association) by it voluntarily executed.
Notary public in and for said County
(In all cases add signature and title of the officer taking the ac­
knowledgment, and strike from between the parentheses the word or
clause not used, as the case may be.)
Actions. The common law forms of pleading are not used,
although the common law forms the basis of procedure. Pleading,
practice, and procedure are statutory, and accord, in the main,
With what is known as the reformed, or code procedure.
Administration of Estates. When an executor is not appointed
by will administration shall be granted to any suitable person or
persons on the request and application of: 1. The surviving spouse.
2. The next of kin. 3. Creditors. 4. Any other person showing good
grounds therefor.
To each of the above classes in succession, a period of 20 days,
commencing with the burial of the deceased, is allowed within which
to apply for administration.
A special administrator may be appointed to preserve property if
for any reason general administration cannot be immediately granted.
Administration shall not be originally granted after 5 years from
the death of the decedent.
Claims against the estate of a deceased person are payable In the
following order: 1. Charges of the last sickness and funeral of the
deceased. 2. Any allowance made by the court for the maintenance
of the widow and minor children. 3. Debts entitled to preference under
the laws of the U. S. 4. Public rate and taxes. 5. Claims filed
within 6 months after the first publication or posting of the notice
given by the executors or administrators of their appointment. In
this class, claims for labor performed within the next preceding 90
days of the death of decedent are preferred. 6. All other debts.
7. Legacies and the distributive shares, if any.
All claims of the sixth of the above classes not filed and allowed,
or if filed and notice thereof not served within 12 months from the
giving of the notice of appointment are barred, except as to actions
against decedent pending in the district or supreme court at the time
of his death or unless peculiar circumstances entitle the claimant to
equitable relief.
Affidavits. Affidavits may be taken before any person authorized
to administer oaths in the state where taken. If taken without the
8tate of Iowa, the official character of the officer administering the
oath should be evidenced in the same wav as the official character of
an officer taking depositions. (See Depositions.) Affidavits may be
taken within the State for any lawful purpose, of one unwilling to
voluntari ly mak e an affidavit, by flli ng a petit ion with an offi< er aut hortzed to administer oaths, who may cause the person to come before
him and make affidavit. This proceeding is statutory and must con­
form strictly to the statutes of Iowa.
Affidavits for proving accounts and form: State of...........................
County of.................... ss, I................. being first duly sworn, on oath
depose and say that 1 am (a member of the firm of.................... and
that said firm is) the owner of the account hereto attached, marked
exhibit A, and made a part hereof, that the same is correct in all
particulars and that the articles named therein were sold and delivered
to said.................. at the prices and times therein named and agreed
upon, and that said articles were reasonably of the value charged,
and that the said account is due and unpaid. That there is no legal
set off or credit to the same or any part thereof except as herein stated.
Subscribea and sworn to before me, by the said.................... this....
day. etc.
Aliens. Non-resident aliens or corporations incorporated under
the laws of any foreign country or corporations organized in this
country, one-half of the stock of which is owned or controlled by non­
resident aliens are prohibited from acquiring title to or holding any
real estate in Iowa, but the non-resident alien widow heirs, or devisees
of an alien or naturalized citizen may hold the same for twenty years,
and if not sold within that time, escheats to the State. Aliens may
acquire property of any kind within a city or town or lands not exceed­
ing 320 acres or stock in any corporation for pecuniary profit and may
alienate or devise the same, but this law does not affect personal
property. A lien holder may acquire title to the property embraced
in such lien but real estate so acquired must be sold within ten years
after title is perfected in an alien, otherwise it will escheat to the
State.
Arrest. No person can be imprisoned for debt on either mesne
or final process, unless in case of fraud. Debtors, however, may be
ordered to appear before a court of record wherein a judgment has
been rendered and if the debtor is about to leave the State, or conceal
himself he may be arrested and compelled to give bond to appear
before the court for examination, and in the meantime, not dispose
of his property. (See Supplementary Proceedings.)
Assignments and Insolvency. General assignments not valid
unless for benefit of all creditors, when assent of creditors is presumed.
The debtor must annex to the instrument of assignment a sworn
Inventory and list of creditors: and such instrument must be acknowl­
edged and all of the papers recorded like a deed of real estate. The
assignment' vests in the assignee title to all property of the debtor.
Assignee must give bonds, prepare a verified inventory and valuation,
and notify creditors by mail to file claims within three months.
All claims not filed within three months after notice published or
within such extended time as the court grants, not exceeding nine
months, including claims not yet due. can not be paid until all claims
filed within said time are paid. An assignment does not discharge
the debtor from his debts and liabilities, but only entitles creditors
to share equally in his estate. All claims filed must be itemized
and sworn to.
Attachments. An attachment, auxiliary to the ordinary pro­
ceedings may be sued out at the commencement or during the progress
of the proceeding if the petition is sworn to and states one or more of
the following grounds: X. That the defendant is a foreign corporation
or acting as such. 2. That he is a nonresident of the state. 3. That
he is about to remove his property out of the state without leaving
sufficient remaining for the payment of his debts. 4. That he has
disposed of his property in whole or in part, or is about to do so, with
intent to defraud his creditors. 5. That he has absconded so that the
ordinary process cannot be served upon him. 6. That he is about to
remove permanently out of the county, or state, and has property
therein not exempt from execution and that he refuses to pay or
secure the plaintiff. 7. That he is about to remove his property or a
part thereof out of the county with intent to defraud his creditors.
8. That he is about to convert his property or a part thereof into money
for the purpose of placing it beyond the reach of his creditors. 9. That
he has property or rights in action which he conceals. 10. That the
debt is due for property obtained under false pretenses.


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Property of debtor may be attached for debt not yet due if his

states one or more of following grounds: 1. That defendant
i about to dispose of his property with intent to defraud his creditors.
Setition
2. That he is about to remove or has removed from the state, and

refuses to secure the payment of the debt when it falls due, and which
removal or contemplated removal was not known to the plaintiff at
the time the debt was contracted. 3. That the defendant has dis­
posed of his property in whole or in part with intent to defraud his
creditors. 4. That the debt was incurred for property obtained under
false pretences.
Special attachments are permitted in certain cases.
On all above cases the plaintiff must file a bond in a penalty at
least double the value of the property sought to be attached.
Banks and Banking. Savings, State Banks and Trust Companies
may be formed by not less than five persons of lawful age a majority
of whom shall be citizens of this state. The minimum paid up capital
depends upon the population of the city wherein the bank is located.
$25,000 paid up capital is required for towns having a population of
3 000 or less.
In cities and towns having a population from three thousand but
not exceeding six thousand, $50,000 is the minimum. In cities having
a population of 6,000 or over $100,000 is the minimum.
At least three-fourths of the directors must be citizens of this state
and all must be shareholders.
No banking institution organized under the laws of this state shall
declare or pay any dividend until it has first established a surplus of
at least twenty per cent of its capital. Whenever such banking
institution has created a surplus of twenty per cent, it shall credit to
surplus from net earnings not less than 10 per cent thereof each year
until a surplus of fifty per cent of the capital has been created. There­
after each such institution shall maintain a surplus equal to at least
fifty per cent of its capital, and any reduction of said surplus shall be
restored in the same manner as originally created as provided herein.
Bank drafts and cashier’s checks are preferred claims against the
assets of the bank issuing them.
State banks, savings banks, and trust companies have a prior Hen
on their debtors’ shares of stock for all obligations to the bank subject,
however, to loans against the stock which the bank has acknowledged
by written notice.
State and savings banks and trust companies have power when so
authorized by their articles of incorporation, to act as assignee or
trustee by deed and guardian, executor, or trustee by will or to be
appointed receiver, assignee, guardian, administrator or other trustee
by any court of record in this state:
National banks may exercise the same powers when so authorized
by any law of the United States.
Any state, savings bank or trust company, may become a member
of the Federal Reserve System.
It is unlawful for any officer or employee of any bank or trust
company to offer for sale or promote the sale of any stock, real estate,
life insurance, fire insurance, bonds or other securities, unless the
sale of the same shall have been sanctioned and approved by the
Board of Directors and such approval entered of record. It is a
misdemeanor for any officer or employee to violate the above.
The president and cashier of every savings bank and every state
bank shall cause to be kept at all times, a full and correct list of the
names and residences of the officers, directors, examining committee
and all the stockholders of the bank. This list shall also show the
number of shares held by each. Such lists shall be subject to the
inspection of all the stockholders and creditors of the bank during
business hours of every day in which business may be legally trans­
acted. The president and cashier shall verify by oath a copy of the
list and send the same to the Superintendent of Banking within ten
days after each annual meeting. And the Superintendent may, if
he desires, require the president or cashier to furnish him with financial
statements of the stockholders.
In the event any state bank, savings bank or trust company holding
a charter to transact business within the state fails to transact business
or perform the duties imposed on it by the banking law, such charter
may be cancelled on proper hearing by the District Court.
No person shall be eligible as a director of any savings or state
bank or trust company unless such person owns shares of stock in
that bank as follows:
(a) In banks whose capital is less than $30,000 he must hold at
least $200 worth of stock at par value.
(b) In banks having a capital of $30,000 or more he must hold and
own at least $500 worth of stock at par value.
No state bank, savings bank or trust company shall pay interest
on savings accounts or certificates of deposit or any other time deposit
at a rate greater than 4 per cent per annum payable semi-annually.
No interest in any event shall be paid upon such time deposits for
any period less than three months.
If, however, there are any savings accounts or time deposits bearing
interest at a rate greater than 4 per cent the same shall be considered
borrowed money and shall be so reported to the superintendent of
banking.
Before any director of a state bank, savings bank, or trust company
acts as such, he must take an oath that he will diligently, faithfully,
and impartially perform the duties imposed upon him by law. That
he will not violate nor permit to be violated any of the banking law,
and that he is a bona fide holder in his own right of the number of
shares required to be owned by him. and that the same have not been
hypothecated.
The Board of Directors must hold at least one meeting each calendar
month. The State Superintendent of Banking may require, if in his
opinion it would promote the banking industry to do so, that un­
secured loans in amounts exceeding $500, shall not be made except
where the borrower submits a financial statement.
No executive officer of any bank or trust company shall use directly
or indirectly any money of the bank in excess of 10 per cent of the
capital and surplus. Nor shall the total amount loaned to all executive
officers of the bank exceed 25 per cent of the combined capital and
surplus. No such loans can be made unless the same shall first be
approved In writing by a majority of the board of directors, exclusive
of the party borrowing.
If any bank officer certifies a check in excess of the balance on
deposit or issues a certificate of deposit when the full amount has
not been deposited, he is guilty of a misdemeanor. No officer of any
bank shall have power to pledge or hypothecate any obligations owned
by the bank unless authorized to do so by a resolution of the board
of directors. Any pledging or hypothecation without such authority
is void and the party guilty is liable for imprisonment up to twenty
years.
All officers and employees of any bank having the care or custody
of any funds or securities of the bank must furnish a bond subject to
the approval of the board of directors.
Any person knowingly issuing a false financial statement to a bank
with intent to defraud respecting his financial condition, shall be guilty
of a misdemeanor.
Whoever maliciously or with intent to deceive, makes or circulates
any false report concerning any bank which tends to impute an
unsound financial condition of the bank or cause a general withdrawal
of deposits, shall be guilty of a felony and subject to fine and im­
prisonment.
When any legal holiday falls on Sunday the following Monday shall
likewise be a legal holiday as far as banks are concerned.

BANKING AND COMMERCIAL LAWS—IOWA
Parent banks may establish offices in counties contiguous to the
one in which the main offices are located only for the purpose of
receiving, depositing, paying checks, and performing other clerical
and routine duties in connection therewith.
Bills of Exchange. The uniform negotiable instruments law Is In
effect in Iowa.
Blue Sky Law. A complete system of law for the regulation of
the sale of securities known as the "Iowa Securities Law” is now in
force. This act applies to sales and purchases within the State of
Iowa of stocks, bonds, notes, debentures and practically all other
evidences of Indebtedness. A copy of this law In pamphlet form as
well as all necessary blanks, etc., may be obtained free on application
to the Secretary of State.
Chattel Mortgages. No sale or mortgage of personal propertywhere the vendor or mortgagor retains actual possession, is valid
against existing creditors or subsequent purchasers without notice,
unless a written instrument con veyinc same, be executed acknowledged
like conveyances of real estate, and such instruments, or a duplicate
thereof duly recorded, or filed and deposited with the recorder of the
county where the property shall then be situated or if the mortgagor
be a resident of the state, then of the county where the holder of the
property resides. No encumbrance of personal property which may
be exempt from execution by the head of a family if a resident of the
State shall be of any validity unless the same be by written instru­
ment and unless the husband and wife concur in and sign the same
Joint instrument.
Collateral Securities. There are special statutory provisions
concerning the pledging of corporate stock, as security; and also
upon the subject of sales of collaterals by action in court and judicial
•ale. Otherwise the subject is governed by the common law.
Conditional Sales. No sale, contract, or lease wherein the
transfer of title or ownership of personal property is made to depend
upon any condition, shall be valid against any creditor or purchaser
of the vendee or lessee in actual possession, obtained in pursuance
thereof, without notice, unless the same be in writing, executed
by the vendor and vendee, or by the lessor and lessee, acknowledged
by the vendor or vendee, or by the lessor or lessee, and recorded or
filed and deposited the same as chattel mortages.
Conveyances. No particular form is necessary for conveyances
or mortgages. The name of the parties, the description of the property,
the consideration, the date, signature, and acknowledgment, is all
that is necessary; as between the parties they are valid without
being recorded. The wife must join with her husband in conveyances,
and a conveyance of the homestead is of no validity ui less husband
and wife concur in and sign the same joint instrument A corporation
executes conveyances under its corporate seal, except where the
corporation has not adopted a seal. Such conveyances must be signed
in the name of the corporation by the officers authorized so to do,
by the Articles of Incorporation, or By-Laws, or by resolution duly
entered of record in the minutes of the corporation, and duly acknowl­
edged by such officers, as the act of the corporation.
The legislature has by statute approved the following forms:
1. Quit claim deed.
For the consideration of $................ I hereby quit claim to...................
all my interest in the following described tract of real estate: (De­
scribing it.)
2. For a Deed conveying fee simple without warranty:
For the consideration of $..................I hereby convey to........................
the following tract of real estate (Describing it.)
3. For a Deed conveying fee simple with full warranty: add to
number 2 the following:
And I warrant the title against all persons whomsoever.
4. For a Mortgage; add to number 2 the following: To be void
upon condition that I pay, etc.
Of course, the above instruments must be signed by the grantor,
and if he is married his wife must also sign to convey her dower
Interest. If it is desired that any of the above instruments be recorded,
then the same must be acknowledged.
Corpm at Ions. Private corporations, sole or aggregate, may be
formed for any lawful purpose. But there are special statutory
provisions which must be complied with for the organization and
government of insurance, banking, loan and trust, building and loan,
and railway corporations. In all cases, the articles of incorporation
must he acknowledged and recorded, in the manner provided by
law. and approved by the secretary of state. With a few exceptions,
an Incorporation fee or $25. plus $1 for each thousand dollars of
capital in excess of $10,000 must be paid, upon the organization
or renewal of a private corporation. The general term of the life
of a private corporation is twenty years, renewable for a like term.
Railroads, savings banks, and a few others may last fifty years,
also renewable.
Foreign corporations must obtain a permit to do business in the
•tate. The statute provides in detail what the application shall
contain, and must pay to the Secretary of the State a fee of $25 upon
$10,000 or less of money and property of the company actually within
the State, and $1.00 for each $1,000 of such money or property within
the State in excess of $10,000. 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
•uch contract it shall have procured such permit. This prohibition
•hall also apply to any assignee of such foreign stock corporation and
to any person claiming under such assignee of such corporation or
under either of them.
The Articles of Incorporation may prescribe any figure as the par
value of each share of stock, or the stock may be issued, "Without
Par Value.”
Courts. Terms and Jurisdiction. The district court has jurisdic­
tion of ail actions, civil and equitable, and has criminal and probate
Jurisdiction. Superior courts may be established by the vote of
the people in any city of 4.000 inhabitants. It has jurisdiction to
try all violations of city ordinances, and the same criminal jurisdiction
as Justice of the peace courts. It has jurisdiction to try and determine
civil and criminal appeals and civil writs of error from justices of
the peace, situated in the township where the court is located. Has
the same jurisdiction as the district court to try all suits in law and
equity, except grant divorces, alimony, and separate maintenance,
and it has no probate jurisdiction. Transcripts from superior and
justice’s courts must be filed in district court to create a lien on real
estate, and are then enforced as judgments of the district court;
Justice's jurisdiction, $100, or, by written consent of parties, $300.
The supreme court has only appellate jurisdiction and holds sessions
at Des Moines, January to May, from May to September (less vaca­
tion), and from September to December.
Municipal Court may be established by the vote of people in cities
of 5,000 inhabitants. It has jurisdiction to try all violations of city
ordinances, and the same criminal jurisdiction as Justice of the Peace
court, and exercise the jurisdiction conferred on the District Court
for the trial of misdemeanors. It has concurrent jurisdiction with
the District court in all civil matters involving $1,000 or less, but haa
no jurisdiction to grant divorces, alimony or separate maintenance,
and has no probate jurisdiction. Transcripts must be filed in District
Court to create a lien, and appeals are taken direct to the Supreme
Court.
Bays of Grace. Every negotiable instrument is payable at the
time fixed therein without grace.
Depositions may be taken within the State, on notice, and within
or without the State, on commission, issued after notice by the clerk
of the proper court. When to be taken on commission, defendant


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2173

may elect, in writing, duly served, to cross examine orally: thereupon
plaintiff may also elect in writing to examine orally. Exceptions
must be filed within three (3) days, after the filing of the deposition,
but objections may nevertheless be made on the trial for competency,
materiality, and relevancy.
Descent and Distribution of Property. Subject to rights of
dower and other charges thereon, and burdens imposed during the
lifetime of the decedent, and in the absence of a valid will, the estate
of one deceased shall descend in equal shares to his children. The
heirs of any deceased child shall inherit in same manner as though
•uch child had outlived his parents. If the intestate leave no issue
the whole of the estate to the extent of $7,500 after payment of debts
and administration expense, and one-half of the estate in excess of
said $7,600 goes to the surviving spouse and the other half to the
parents. If no surviving spouse, the whole thereof shall go to his
parents or the survivor of them; and so on through ascending an­
cestors and their issue, if both parents be dead. Personal property
not necessary to pay debts is distributed to the same persons, and in
the same proportions as though it were real estate.
Dower. Dower in Iowa is abolished, but the surviving spouse
Is entitled to one-third in value of all the legal and equitable estates
In real property possessed by the deceased spouse at any time during
the marriage, which have not been sold on execution or any other
Judicial sale, and to which such survivor has made no relinquishment
of right. A spouse, heir or devisee feloniously taking or procuring the
taking of the life of the other spouse, or decedent, cannot have dower
or inherit power or take under the will of the decedent. (See Limi­
tations.)
Employers Liability. Employers liability and workmen's com­
pensation is governed by statute.
Executions may be stayed, according to their amount, for ninety
days or six months, with a few specified exceptions, and the issuance of
execution may be prevented by filing an appeal bond. Otherwise
execution may issue Immediately after rendition of judgment. The
Judgment is a lien on realty within the county where rendered, or by
transcript, it may be made a lien in any other county. Executions
become liens on personal property only from the time of the levy and
seizure. Real estate is sold on execution subject to redemption within
one year, except in appealed cases, or where the interest is a leasehold
of two years or less. Creditors having liens, may redeem from the
•ale after six months and before nine months from date of sale. Per­
sonal property is sold without redemption.
Exemptions. The head of a family is entitled to a homestead of
forty acres or less of farm land or half an acre or less in a city or town.
When a debtor absconds and leaves his family, such property as is
exempt to him shall be exempt in the hands of his wife and children
or either of them. The statute provides for numerous exemptions of
personalty to the head of the family including: 1. The proper tools,
instruments or books of the debtor, if a farmer, mechanic, surveyor,
clergyman, lawyer, physician, teacher, or professor, except that no
motor vehicle shall be held exempt from any order, judgment or
decree for damages occasioned by the use of said motor vehicle upon
a public highway of this state. None of the above articles are exempt
for the purchase price thereof. 2. All money received by a person
as pension money whether deposited loaned or invested by him. 3.
Earnings for his personal services at any time within 90 day* next
preceding the levy. 4. Any compensation due or may become due
under the workmens compensation act.
There are statutory provisions concerning the creation of liens on
exempt real or personal property and the assignment of exempt wages.
There is no exemption to debtor under a decree for the support of
minors. Nor is there any exemption for the payment of alimony
unless the party in whose favor the decree was rendered remarries.
Fraud. In actions for fraud, heretofore solely cognizable in a court
of chancery, the cause of action shall not be deemed to have accrued
until the fraud complained of shall have been discovered by the party
aggrieved by the exercise of due diligence. In actions brought by a
Judgment creditor to set aside a fraudulent conveyance of property
from one spouse to the other and to subject said property to execution,
either husband or wife may be compelled to testify against the other.
Gross fraud is punishable by fine or imprisonment.
Garnishments. (See Attachments.)
Husband and Wife. (See Married Women.)
Holidays. The first day of the week. January 1. February 12,
February 22, May 30, July 4, the first Monday in September, the
eleventh day of November. December 25, the day of general election
and any day appointed or recommended by tne governor or this State
or the President or the United States as a day of fasting or thanks­
giving are holidays, for all nurposes relating to the presentation for
payment or acceptance, and for the protesting and giving notice of
the dishonor of bills of exchange, drafts, hank checks, orders and
promissory notes, and bank or mercantile paper falling due on any
of the above named dates, shall be considered as falling due on a
succeeding business day.
Interest. By written contract, maximum legal rate, 8 per cent.
Judgments draw 6 per cent, or such rate as is fixed by the contract
on which the judgment or decree is rendered, not exceeding 8 per
cent per annum. Open accounts draw fi per cent after six months
from date of last item; money loaned, money due. money due on
settlement of accounts, bear interest at 6 per cent per annum. Con­
tract for more than 8 per cent forfeits ail interest and costs.
Judgments in the district and superior courts may be obtained
at first term after suit commenced, if undefended; an equitable
action, except one for foreclosure of mortgage, or mechanic’s lien
or for divorce, is triable at the second term after the case is at issue.
Judgments of the district court are liens on real estate owned by
the debtor at the time of rendition, if the lands lie in any other
county, from the time of filing therein an attested copy of the judg­
ment. Lien also covers all lands which defendant may acquire
within ten years from date of judgment, or upon which a levy is
made after ten or before twenty years from the date of the judgment,
but this lien dates only from the time of the levy. Judgments of
superior courts and justice of peace courts become liens on real estate
by filing transcript in district court within county where obtained,
and become liens in other counties in the same manner as if rendered
In the district court.
Liens. These are mainly created by statute and are enforceable
in equity. In a few cases, and under peculiar circumstances, equitable
liens on real estate are established and enforced in equity.
Limitations. Actions, according to their subject matter, have
various periods of limitation, fixed by statute, extending from three
months to ten years after the cause of action accrued. Actions upon
judgments rendered in courts of record have a limitation of twenty
years. There are special limitations barring action for interest in
real estate based on defective trustees, guardians, administrators,
executors and sheriffs deeds; also as to other defects in the title te
real estate.
Married Women may own in their own right, real and personal
property, and may manage, sell, convey, and devise the same by
will. Neither husband nor wife is liable for the debts or liabilities
of the other incurred before or after marriage, nor are the wages,
earnings, or property of either liable for the separate debts of the,
other. Contracts may be made by a wife, liabilities incurred, and
enforced by or against her, as if unmarried. Both husband and
wife are liable for the reasonable and necessary expenses of the family,
and the education of the children.
Mortgages must be subscribed and acknowledged by the parties
creating the lien and recorded same as deeds. The wife should join

2174

BANKING AND COMMERCIAL LAWS—KANSAS

In the instrument, except mortgages for purchase money, and mort­
gages upon non-exempt personal property. The mortgagor has one
year in which to redeem real estate after execution sale, except as
stated under the sub title “Executions.” When a mortgage is paid
off, satisfaction thereof must be made on margin of the record, or by
satisfaction piece, acknowledged and recorded. If no satisfaction is
entered within thirty days after request in writing, the mortgagee
forfeits $25. (See Chattel Mortgages.) (See Limitations.)
Non-residents. Action may be brought against non-residents to
enforce liens on any property within the state; to enforce any debt
against a non-resident where action is aided by attachment on prop­
erty found within the State. Personal judgment cannot in any case
be rendered against defendants, not appearing, unless personal
service is had on such defendants within the State. Non-residents
may not sell at auction unless reciprocal legislation exists in the state
of their residence.
Notaries. These officers are appointed and commissioned by the
governor, upon filing a bond and paying the fee required by law.
They have power to administer oaths, take depositions, and the
usual power of such officers concerning presentation, demand, protest,
and notice of protest of negotiable commercial paper, only within the
county in which commissioned.
All notarial commissions expire July 4, 1933 and are renewable for
three year periods commencing with that date.
Partnerships, Limited and Special. Limited and special part­
nerships are permitted, but not favored. The statutes on this subject
must be strictly complied with- A certificate showing prescribed
details and particulars of the partnership must be signed, acknowl­
edged, and filed in the office of the cierk ot the district court of the
county in which the principal place of business is situated, to be
there recorded and similarly recorded in each county where such
partnership has a place of business. There must be an affidavit
that the amount stated in the certificate has been actually contributed
by each separate partner. Publication must be made ot the ce”tifieate
and affidavit for six weeks in two newspapers in each senatorial
district in whicn the partnership is to transact business.
Powers of Attorney. A power of attorney to convey, or in any
manner affect real estate, must be acknowledged and recorded. A
revocation of such power must be acknowledged and recorded in the
same office wherein the original power of attorney is recorded.
Receivers. A receiver may be appointed on the petition of either
party to a civil action or proceeding wherein he shows that he has a
probable right to or interest in any property which is the subject of
the controversy and that such property is in danger of being lost or
materially injured or impaired. When the property of any person,
partnership, company or corporation has been placed in the hands of
a receiver for distribution, after the payment of all costs, the following
claims shall be entitled to priority of payment. 1. Taxes or other
debts entitled to preference under the laws of the U. S. 2. Debts
due or taxes assessed and levied for the benefit of the state, county,
or other municipal corporations in the state. 3. Debts owing to
employees for labor performed within the 90 days next preceding the
transfer of such property.
Records. All instruments conveying or creating liens upon the
real or personal property and all conditional sales must, after having
been signed and acknowledged, be recorded in the office of the recorder
of deeds in the proper county or counties where the property conveyed
is situated. Unless so recorded, such instruments are invalid as to
a bona fide purchaser or encumbrancer.
Redemption. Redemption from a sheriff’s sale of real estate,
whether sold under a general or special execution, may be made
by a creditor who has a lien on the property sold, at time after six
months and within nine months from date of sale by paying to the
clerk of the court the amount provided by statute, being generally,
the amount of the purchaser’s bid, with interest at the same rate that
the judgment bears. Within the time named creditors may redeem
from each other. After nine months, and within one year’s from the
date of sale the owner of the real estate sold has the exclusive right to
redeem from such sale, and in so doing, the debtor must pay off the
claims of judgment creditors, who have made redemptions as herein
above stated, in addition to the amount originally bid.
Replevin. In actions for the recovery of personal property, the
petition must be verified; and if plaintiff desires immediate delivery
of the property, he shall execute a bond for double the value of the
property sought to be recovered. The defendant may stay all pro­
ceedings and retain the property by executing a bond to the plaintiff
with sureties to be approved by the clerk.
Sales. This State has a uniform sales law.
Sales of Goods in Bulk. The sale, transfer or assignment in bulk
of any part of the whole or a stock of merchandise and fixtures per­
taining thereto otherwise than in the ordinary course of trade and
in the regular orosecution of business, is void as against the creditors
of seller; 1. unless at least seven days before the sale a detailed
Inventory is made, and 2. unless the purchaser demands and receives
from the seller a written list of names and addresses of the creditors
of the seller, with the full amount of indebtedness due or owing to
each and certified by the seller under oath to be a full, accurate and
complete list of his creditors and of his indebtedness, and 3. unless
the purchaser shall at least seven days before taking possession or
paying the purchase price, notify personally or by registered mail
every creditor whose name and address are stated in said list or to
which he has knowledge, of the proposed sale and of the price, terms
and conditions thereof.
The bulk sales law does not apply to sales by executors, admini­
strators, receivers, trustees in bankruptcy, or any public officer under
judicial sale. A purchaser not complying with these provisions be­
comes a receiver and accountable to the creditors for all merchandise
and fixtures coming into his possession by virtue of the purchase.
Security for Costs. Nonresident and corporation plaintiffs may,
on motion of defendant, be required to file a bond with sureties to be
approved for security of costs either in Justice Court, Municipal
Court, or District Court.
Statute of Frauds. No evidence except in writing and signed
by the party to be charged or by his authorized agent, is competent
relative to the following contracts: 1. In relation to sale of personal
property, when no part of the property is delivered and no part of
the price is paid. 2. In consideration of marriage. 3. Wherein
one promises to answer for the debt, default or miscarriage of another,
including promises by executors to pay the debt of decedent from their
own estate. 4. For the creation or transfer of any interest in lands,
except leases for a term not exceeding one year. 5. Those not to
be performed within one year from the making thereof.
Stocks and Bonds. The sale of stocks and bonds is governed by
what is termed a “Blue Sky Law.”
Supplementary Proceedings. When an execution has been
returned unsatisfied, plaintiff may have an order for the appearance
and examination of the judgment debtor; or such order may be
obtained after execution has issued upon proof by plaintiff’s affidavit
or other proof that debtor has property which he unjustly refuses to
apply to the satisfaction of the judgment. If any property be found
by such examination it may be levied upon; if in the hands of others
the court may require its delivery to satisfy the judgment, and
appoint a receiver of debtors property, forbid the sale thereof and
order Equitable interests in realty to be sold.
'Taxes. Real estate is assessed every odd year; personal property
is assessed every year. All property is assessed at Its actual value,
and taxed at twenty-five (25) per cent of the assessed value. All
road taxes and one-half of the other taxes levied are payable without
interest or penalty before April 1st; the balance is payable


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before October 1st. Delinquent taxes bear interest at the rate of
1 per cent per month. Taxes upon realty are liens thereon; taxes
upon personalty are liens upon the owner’s realty, except the home­
stead, and may be continued as such liens, if the statute is complied
with, from year to year. Taxes upon stocks of goods or merchandise,
fixtures and furniture in hotels, restaurants, rooming houses, billiard
halls, moving picture shows and theaters is a lien thereon and such
lien continues when sold in bulk and the purchaser is personally liable
therefor; also a lien on buildings assessed separate from real estate;
taxes assessed on personalty in this state belonging to a nonresident
Is a lien thereon. Personal property may be levied on and sold for
taxes by distress and sale. Real estate Is sold for unpaid taxes, after
notice by publication on the first Monday in December of each year,
subject to redemption in three years from the date of sale.
Trust Companies. Domestic trust companies are organized under
and governed by the general corporation laws of the State. Foreign
trust companies doing business in this State are governed and con­
trolled by the general statutes concerning and relating to foreign
corporations doing business in Iowa. (See Corporations.)
Trust Deeds. They must be executed and foreclosed, and consid­
ered as mortgages. That is, the power of sale on notice is abolished,
and they must be foreclosed by equitable action.
Warehouse Receipts. Any person, firm, or corporation desiring
to issue elevator or warehouse certificates (or receipts must file a
written declaration with the recorder of deeds in the county where
his or its elevator or warehouse is situated, setting forth the particu­
lars required by statute, which declaration must be recorded by the
recorder of deeds. Thereafter he or it may issue certificates for
commodities actually in such elevator or warehouse, but the certifi­
cates must conform to the statutory provisions. A register of
certificates issued must be kept by the parties issuing them. A
violation of these provisions, issuing double certificates for the same
property, or selling or encumbering property included in any ware­
house receipt, is made a criminal offense. There is also a criminal
statute against issuing false warehouse receipts or certificates.
Wills. Any person of full age and sound mind may dispose of
his property by will, subject to the rights of homestead and exemp­
tion created by law and the distributive share in his estate given
by law to the surviving spouse, except sufficient to pay his debts
and expenses of administration. Wills, to be valid, must be written,
witnessed by two competent witnesses, signed by the testator, or
by some person in his presence and by his express direction. Sub­
scribing witnesses can derive no benefit from a will, unless there be
two competent witnesses besides them. Wills executed outside of
Iowa, in accordance with the laws of the State where executed or
of the testator’s domicile, if in writing and subscribed by the testator
are valid in Iowa. If probated in any other state or country they
shall be admitted to probate in this State on the production of a copy
of such will, and of the original record of probate thereof, authenticated
by the attestation of the clerk of the court In which such proba­
tion was made or of the probate judge, under seal, if they have one.
All wills must be probated before they can be effectual.

SYNOPSIS OF

THE LAWS OF KANSAS
RELATING TO
BANKING AND COMMERCIAL USAGES
Revised by Doran, Kline, Colmery & Cosqrave,
National Reserve Bldg., Topeka, Kans.
(See card in Attorneys List.)
Acknowledgments. (See Deeds.)
Actions. Civil actions are conducted as required by a code of
procedure. Security for costs must be given or resident plaintiffs
may deposit $15 in lieu of bonds for cost. Non-resident plaintiffs
may be required to give bond for costs.
Administration of Estates. Probate courts In each county have
Jurisdiction of estates. Demands against the estate are divided into
the following classes: 1. Funeral expenses. 2. Expenses of the
last sickness; wages of servants; demands for medicines and medical
attendance during the last sickness and expense of administration.
3. Debts due the State. 4. Judgments rendered against the
deceased in his lifetime; but if such judgments are liens upon real
estate and the estate be insolvent, such judgments shall be paid
without reference to classification, except the first two which have
recedence. 5. All demands without regard to quality which shall
e legally exhibited against the estate in one year after granting
first letters of administration. 6. Demands not exhibited within
one year are barred, except as to infants, persons of unsound mind
or persons imprisoned or absent from the United States, who shall
have one year after the removal of their disabilities. Foreign ex­
ecutors, and administrators with the will annexed, may sell real
estate in this State in accordance with the power contained in the
will, unless administration upon the estate has been granted in this
State; provided that at the time of such conveyance an authenticated
copy of such will has been recorded in the office of the probate court
in the county in which the land is situated.
Affidavits. Affidavits may be made in or out of the State by the
same authority and with like authentication, as depositions.
Allens. Law prohibiting aliens from Inheriting or holding real
estate, repealed 1901. (See Foreign Corporations.)
Arbitrations. Persons having controversies may submit them to
the arbitration of any person or persons mutually agreed upon and
may make such submission a rule of any court of record in the State.
The parties may enter into arbitration bonds conditioned for the
faithful performance of the award. Award to be filed in court agreed
on and judgment entered as on a verdict of jury. Parties may have
process, orders, and execution as in civil cases.
Arrest. Upon the plaintiff filing a bond in double amount of his
claim, a defendant may be arrested in a civil action upon filing an
affidavit with the clerk of the court that he has removed or begun
to remove his property out of the jurisdiction of the court with
intent to defraud his creditors; or has begun to convert his property
into cash, for the purpose of placing it beyond the reach of his creditors;
or has property which he fraudulently conceals; or fraudulently con­
tracted the debt.
Assignments and Insolvency. Assignments must be for the .
benefit of all creditors and only discharge the debtor to the amount
of payments made.

BANKING AND COMMERCIAL LAWS—KANSAS
Attachment. At or after the commencement of an action an
attachment may be had by plaintiff. The affidavit of the plaintiff,
his agent, or attorney must be filed, stating the nature of the claim
that it is just, the amount affiant believes ought to be recovered,
and the existence of some one or more of the following grounds: 1.
That defendant is a foreign corporation or a non-resident of the State
(but in this case for no other claim than a demand arising upon con­
tract, judgment, or decree, unless the cause of action arose wholly
within the limits of the State). 2. That the defendant absconded
with the intention to defraud his creditors. 3. That the defendant
has left the county of his residence to avoid a service of summons.
4. That he so concealed himself that summons can not be served
upon him. 5. That he is about to remove his property or a part
thereof out of the jurisdiction of the court with the intent to defraud
his creditors. 6. That he is about to convert his property or a
part thereof into money for the purpose of placing it beyond the
reach of his creditors. 6. He has property or rights in action which
he conceals. 8. Has assigned, removed, or disposed of, or is about
to dispose of bis property, or a part thereof, with the intent to defraud,
hinder, or delay his creditors. 9. Or fraudulently contracted or
incurred the debt on which the suit is brought. 10. Or that the
suit is brought for damages from the commission of some felony or
misdemeanor. 11. Or that the debtor has failed to pay for any
article or thing delivered for which by contract he was bound to pay
upon delivery. A bond in double the amount of plaintiff's claim is
required except where by the attachment affidavit defendant is shown
to be a non-resident of the State.
Banks and Banking. There is no constitutional provision relating
to banks, except banks of issue. Other banks are organized under a
general act. The Charter, in addition to the requirements of the
law relating to corporations, shall contain the names and places of
residence of the stockholders and the amount of stock subscribed by
each, and may contain such other provisions, not inconsistent with
law, as the stockholders may deem proper, add shall be subscribed by
at least five of the stockholders of the proposed bank who are residents
of the State of Kansas. Board of Directors not less than five nor
more than twenty-five in number, a majority of whom shall be resi­
dents of the county or adjoining counties to that in which the bank is
located. The word “State” shall be included in the title. The full
amount of the capital stock must be subscribed before the charter is
filed. The bank shall transact no business, except the election of
officers, the taking and approving of their official bonds, and the
receipts of payments on account of subscriptions to its capital stock,
until it has been authorized by the bank commissioner to commence
business. Capital stock shall be subscribed in full before charter is
filed. The capital stock shall be not less than $20,000 in unincor­
porated towns and in cities of the third class; not less than $30,000 in
cities of second class; not less than $50,000 in cities of the first class.
No bank shall employ its money directly or indirectly in trade or
commerce by buying and selling goods,chattels, wares and merchandise,
and shall not invest in the stock of any bank or corporation, nor
make any loans on the security of the shares of its own capital, nor
be the purchaser or holder of any such shares, except to prevent loss
upon a debt previously contracted in good faith. AH such property
coming into the possession of the bank in the collection of debts shall
not be considered assets after the expiration of six months. Banks
must maintain a reserve consisting of fifteen per cent of amount of
its demand deposits and five per cent of amount of its time deposits.
One-half of said reserve shall be in cash or balances in correspondent
banks as primary reserve; other half may be in certain bonds as
secondary reserve. Officers are personally liable for paying over­
drafts. Not more than 15 per cent of the capital stock and surplus
can be loaned to any one person, company or corporation. Penalties
are provided for false statements and: or receiving deposits when the
bank is in a failing condition. Private banks are subject to the
provisions of the law. The Bank Commissioner or deputy must make
examination of each bank at least twice each year. Four reports per
annum are required, and the commissioner may call for others. Banks
may purchase, hold and convey real estate under certain conditions
and for certain purposes to the extent of one-half of their capital and
surplus. Shareholders are additionally liable for a sum equal to the
par value of stock owned and no more. If the Bank Commissioner
finds a bank insolvent or violating any banking law, he shall take
charge and may appoint a special deputy to handle affairs of the
bank for a period of not longer than six months, at which time Com­
missioner must appoint receiver, who serves under orders of District
Court. Claims of creditors must be filed with receiver within one
year from appointment.
Bills of Exchange. (See Notes and Bills of Exchange.)
Bills of Lading. These are governed by the common law.
Balk Sale. "The sale or disposal of any part or the whole of a
stock of merchandise or the fixtures pertaining thereto, otherwise
than in the ordinary course of his trade or business, shall be void as
against the creditors of the seller, unless the purchaser receives from
the seller a list of the names and addresses of the creditors of the
seller certified by the seller under oath to be a complete and accurate
list of his creditors and unless the purchaser shall, at least seven days
before taking possession of the property, or before paying therefor,
notify in person or by registered mail, every creditor whose name
and address is stated in said list, or of whom he has knowledge, of
the proposed sale.”
In lieu of notice may give bond twice amount debts shown by
sellers affidavit signed by two resident sureties, who justify for prop­
erty in excess of the obligation of the bond the bond to be approved
by and filed with the clerk of the district court of the county where
the property sold is located.
Chattel Mortgages. A mortgage of personal property, where the
property is not immediately delivered to the mortgagee who retains
actual and continuous possession thereof, is void as against creditors
of the mortgagor and as against subsequent purchasers and mortgages
In good faith, unless the mortgage, or a copy thereof is filed in the office
of the register of deeds in the county where the property is situated,
or if the mortgagor is a resident of the state, then of the county of
which he is at the time a resident. A mortgage so filed is invalid
after two years unless within thirty days next preceding the expiration
of such two years and each two years thereafter the mortgagee, his
agent or attorney, makes an affidavit exhibiting the interest of the
mortgagee in the property and showing the balance unpaid on the
debt, and files the same In the same manner as the mortgage. In
case of default the mortgagee may sell in the manner provided in the
chattel mortgage.
A mortgage of exempt personal property is invalid unless executed
Jointly by husband and wife where that relation exists unless it be
given for the purchase price of the mortgaged chattel.
Collaterals. Governed by the common law on Bailments and
Pledge.
Conditional Sales. Conditional contracts, by which the owner­
ship remains in the party proposing to sell until the purchase price
is paid, are treated as chattel mortgages and must be filed in the
office of the register of deeds in the same manner as such chattel
mortgages but remain in force without the renewal affidavit required
In chattel mortgages.
Contracts. All contracts which, by the common law, are joint
only, shall be construed to be joint and several. The use of private
seals in written contracts (except seals of corporation) is abolished,
and in suits upon written contracts, as to the performance of con­
ditions precedent, it is sufficient after setting out the contract to
allege generally that plaintiff has fully performed the contract.
Conveyances. (See Deeds.)


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2175

Corporations. Corporations are formed under a general statute.
Prospective corporations must apply to the charter board for a charter.
A $25 application fee and $2.50 filing fee must accompany an applica­
tion. Charter fee is one-tenth of one percent of its authorized capital
stock upon the first $100,000; one-twentieth of one per cent on all in
excess of $100,000. Forms for applications and charters furnished by
the Secretary of State. Every corporation must commence active
operations within one year after filing its charter with the secretary of
state; failure to do so works its dissolution. Duration of charter is fifty
years, or less, as may be specified in the charter. No corporation
(except railroad, banking, and building and loan), can commence
business until it file with the secretary of state an affidavit made by its
president and secretary setting forth that not less than 20 per cent of
Its capital stock has been paid in actual cash, or property equivalent
thereto, but a corporation de facto exists if the 20 per cent has been paid
even though the affidavit has not been filed. The name adopted
must indicate the nature of the business. The corporate name must
begin with the word "the” and end with the word “corporation."
“company,” “association,” or "society," but this does not apply
to banks, benevolent or religious societies. There must be at least
five directors, three of whom must be residents of the State. The
annual statement shall be made by each corporation for profit or on
before March 31st of each year, showing a complete detailed state­
ment of the condition of such corporation, on the 31st day of December
next preceding. Failure to file this report within ninety days from
time fixed works a forfeiture of the charter, and a penalty of $5 for
each day the report is delayed. The capital stock can be increased
to an amount not exceeding three times the original amount fixed in
the charter and to any further amount of bona fide paid up capital.
Capital stock may also be decreased. Preferred stock can be issued
If all the holders of common stock consent. Dividends can not be
declared from any source other than that which results from profits.
The corporation can borrow money not to exceed the amount of its
capital stock.
Corporations (except banks, insurance, building and loan companies
and those not organized for profit) must pay an annual franchise tax
on paid-up capital as follows: Not over $10,000, $10; over $10,000;
and not over $25,000, $25; over $25,000 and not over $50,000, $50;
over $50,000 and not over $100,000, $100; over $100,000 and not over
$250,000, $125; over $250,000 and not over $500,000, $250; over
$500,000 and not over $1,000,000, $500; over $1,000,000 and not
over $2,000,000, $1,000; over $2,000,000 and not over $3,000,000,
$1,500; over $3,000,000 and not over $5,000,000, $2,000; over
$5,000,000, $2,500.
Costs. In the District Court a bond for costs or a cash amount
in lieu thereof must be deposited by resident plaintiffs. Nonresident
plaintiffs may be required by order of court to give additional security
for costs. In Justice Courts cost deposits may be $3.00 to $5.00.
depending on custom of Justice. In City Courts cost deposits are
customarily $5.00.
Courts. Terms and Jurisdiction. District courts, holding two to
three terms a year in every county, have general original jurisdiction
in law and equity. Regular terms of the probate court are held in
each county on the first Monday in each month and special or adjourned
terms may be held as business may require. Justice’s jurisdiction in
civil actions for the recovery of money. $300; to recover specific
personal property not valued in excess. $300. The supreme court is
the court of last resort. City courts with jurisdiction in civil actions
to the amount of $1,000 and in replevin actions to $500 except the city
courts of Wichita and Kansas City which have jurisdiction in replevin
actions to the amount of $1,000, exist in the following cities: Arkansas
City, Atchison, Coffeyville, Kansas City, Leavenworth, Topeka, and
Wichita. Procedure corresponds to that of justice courts.
Creditors’ Bills. Creditors may bring an action in the nature of
a creditors’ bill to marshal assets or set aside fraudulent conveyances
as in other states.
Days of Grace. Abolished.
Deeds. No particular forms of conveyances are prescribed. As
a rule the form used In other States is sufficient. As between
the parties conveyances are valid without being recorded. Deeds
may be valid as against attaching creditors without being recorded.
The wife should join with her husband in the conveyance, and any
conveyance or mortgage of the homestead without her uniting in the
same is absolutely void. If the wife has never resided in the State
her signature is not necessary. Grantors need not attach any seal
or scroll to their signatures, and no witnesses are necessary unless
grantors are unable to write. Corporations convey by deed, sealed
with the corporate seal and signed by president, vice-president, pre­
siding member, or trustee. The acknowledgment must be before a
judge or clerk of the district court having a seal, a justice of the
peace, notary public, county clerk, register of deeds, mayor or clerk
of an incorporated city. Every notary public shall add to his official
signature the date of the expiration of his commission as notary
ublic. In cases where the acknowledgment is made out of the
tate it must be made before a court of record, a clerk, or other
officer having the seal thereof, a commissioner of deeds for Kansas,
justice of the peace or notary public, or before any consul of the
United States resident in any foreign country or port. Deeds and
mortgages must be recorded in the office of the register of deeds of
the county in which the land is situated, or they will be void as to
subsequent grantees in good faith without notice.
Deeds of Trust in the nature of mortgages are not used so far as
sale by the trustee is concerned. (See Trusts, etc.)
Depositions. Depositions are taken upon notice to the opposite
party. Courts are also authorized to appoint commissioners to take
depositions. The depositions may be taken before any person author­
ized to take acknowledgments. Each witness must sign his own
deposition. The notice must be attached to the depositions and
Inclosed with them. Depositions should be taken on the date named
and some portion on each successive day or the officer before whom
the depositions are taken should note continuances or adjournments
from day to day. Sundays and national holidays not being regarded.
If taken by interrogatories and cross-interrogatories, under agreement
or otherwise, each interrogatory and cross-interrogatory must be
put to each witness and answered so far as he can answer it, and the
answer written down. If the depositions are taken before the mayor,
notary public, or commissioner appointed as aforesaid, they must
be certified under his official seal. If before any officer not possessing
a seal, a certificate must be annexed, under the seal of the county, or
the great seal of the State, that the officer by whom the depositions
were taken was, at the time of taking the same, such officer as he
represents himself to be in his certiflctae. This should be attached
to the certificate of the officer (not possessing a seal) who took the
depositions.
Descent and Distribution. The homestead is the absolute
property of the widow and children—one-half in value to the widow,
and the other half to the children, when both survive. The home­
stead can not be divided or sold by an action for partition until all
the children attain majority. One-half of all real estate owned by
husband during coverture, and not conveyed by husband and wife,
nor sold at judicial sale, and not necessary to pay debts goes to the
wife in fee simple; except of land sold by husband whose wife never
before such conveyance resided in the State. Remaining real estate
goes to the surviving children, and living issue of prior deceased
children, children taking per stirpes, in equal shares, or, if none, the
whole estate goes to the widow. For want of wife or child or living
issue of deceased child the whole estate goes to the parents. The rules
applicable to widow of deceased husband apply to husband of deceased
wife. Illegitimate chilaren inherit from the mother, ana also from
the father, if his recognition has been general and notorious, or in
writing. When a child would inherit from either parent, such parent

2176

BANKING AND COMMERCIAL LAWS—KANSAS

will inherit from the child. Personal property descends in the same
way as real estate except exempt household furniture is sole property
of surviving spouse. Property descending by law or will is subject to
an inheritance tax, varying in percentage according to relationship and
amount. (See Exemptions.)
Dower. Dower is abolished by law. (See Descent and Distri­
bution.)
Executions may be ordered as soon as judgment is obtained if stay
has not been granted or supersedeas given. Executions running to
the sheriff of the county where the levy is to be made, may be levied
on property in any county of the State and issue only out of court
where judgment obtained except where abstract or transcript of justice
judgment filed in district court of same county as that of the justice
court, execution will issue on said judgment only out of said district
court. There is no stay of execution in the district court except by
supersedeas bond which may be given on appeal. In justice’s courts,
by filing bond, stays of execution are granted as follows. On any
judgment for $20 and under, thirty days; over $20 and under $50,
Bixty days; over $50 and not exceeding $100, ninety days: over $100,
one hundred and twenty days. Real estate is only subject to execu­
tion issued out of district court of county wherein judgment rendered
or abstract or transcript from justice of the peace filed. Executions
are liens on personal property only from time of levy. Real estate
sold on execution or order of sale, giving the debtor eighteen months
In which to redeem. The debtor is entitled to possession of the
property and rents and profits, during the period provided for redemp­
tion, except in case of waste. Receiver may be appointed to present
waste and may use so much of rents and profits as are necessary to
repair waste and pay costs of receivership. Surplus if any to be paid
to judgment, debtor free from the lien of any judgment.
Exemptions. Homestead of 160 acres of farming land, or of one
acre within an incorporated town or city, with buildings thereon,
appurtenant to the use of the property as a homestead, unlimited in
value. To the head of a family the following articles of personal
roperty: All books, pictures, musical instruments, pews in churches,
urial lots; wearing apparel of debtor and family; beds and bedding,
cooking utensils, stoves and appendages necessary for use of family;
sewing machine and all other Household furniture not exceeding $500;
two cows, ten hogs, one horse or mule; yoke of oxen or in lieu thereof
span of horses or mules; twenty sheep; food necessary for support
of stock hereinbefore mentioned; also one wagon, two plows, one drag
and other farming utensils not exceeding $.300; all provisions and
fuel necessary for support of family for one year; necessary tools
and implements of mechanic, miner or other person used and kept
for carrying on trade or business, and in addition thereto stock in
trade not exceeding $400; library, implements and oftice furniture
of professional man. Also personal earnings of the debtor earned
during three months preceding the garnishment or attachment, and
three months’ pension money, where such earnings or pension money
is necessary for the support of the debtor’s family, but 10 per cent
of such earnings may be required to be paid in and applied on the
judgment.
Foreign Corporations. A foreign corporation doing business in
this State must file a certified copy of its charter or articles of in­
corporation with the secretary of state and pay to the state treasurer
the same fees upon the amount of capital invested or used in this
state as a domestic corporation, when it receives a certificate author­
izing it to do business and is then subject to substantially the same
provisions, judicial control, restrictions and penalties as a domestic
corporation. Annual statements must be filed on or before March
31st. giving condition on the 31st of December preceding. If a
foreign corporation fails to file with the secretary of state the state­
ment required by law within ninety days after the time provided for.
its right to do business in the State is therehv forfeited. A penalty
is imposed oi $5 for each day this report is delayed. Foreign cor­
porations must pay an annual franchise tax on that portion of their
capital represented by its property and business in Kansas on the
same basis as domestic corporations. Failure of foreign corporations
who transact business In Kansas, other than interstate commerce
to comply with this law renders them subject to ouster and receiver­
ship proceedings on the part of the State but does not now affect the
right of such foreign corporation to sue in the courts of this State.
Fraud. (See Attachments, Arrest, and Assignments.)
Garnishment in District Courts. At or after the time of
beginning an action to recover damages founded upon contract,
judgment or decree, or after the issuance of an execution and before
it is returned, if the plaintiff cause to be filed with the clerk an affidavit
stating the amount of his claim over and above all offsets, that he
believes that some person, naming him, indebted to, or has property
in his possession or under his control belonging to the defendants, and
that such defendant has no property liable to execution sufficient
to satisfy his debt, and that the indebtedness or property so held is
not by law exempt from seizure or sale upon execution, the clerk
shall issue a garnishment summons. In justice courts the affidavit
differs from that acquired in district court actions only in that affiant
states that plaintiff is in danger of losing his claim, in lieu of the
allegations that the defendant has not property subject to execution
sufficient to satisfy the debt. In the district courts bond in double
amount claimed is required on garnishments before judgment, except
where defendant is a non-resident No bond required in justice
courts. Defendant may at or after complaint is filed and before
judgment, release garnishment by entering into undertaking with
sufficient surety to the effect that they will pay on demand any judg­
ment rendered against defendant. The bond shall be not less than
double amount of plaintiff's claim.
Guaranty Companies. (See Trust Companies.)
Holidays. The following are legal holidays: January 1st, known
as New Years Day. February 12th, Lincoln's Birthday. February
22nd, Washington’s Birthday. May 30th. Memorial Day. July 4th,
Independence Day. First Monday in September, Labor Day. Oc­
tober 12th, Columbus Day (but does not affect commercial paper),
December 25th, Christmas Day. If any of these days fall on Sunday
the next secular or business day is a legal holiday. Legal or business
proceedings had on a holiday, excepts Sundays, are valid.
Husband and Wife. (See Married Women.)
Injunctions. Injunctions may be granted by a district court or
by the judge thereof at the beginning of an action or afterwards. In
his discretion. A bond must be given to protect the defendant
against any loss in case the injunction is wrongfully obtained. In
the absence of the judge from the county the probate judge may
grant temporary injunctions.
Insolvency. (See Assignments.)
Interest. Legal rate, 6 per cent, but 10 per cent may be agreed
upon. Excess of 10 per cent is forfeited, and in addition thereto there
shall be deducted from the amount due for principal, with lawful
Interest, an amount equal to the interest contracted for in excess of
10 per cent. The legal interest originally contracted for continues
until the debt is paid, and no additional interest can be charged by
way of penalty for default except from date of default. A purchaser
of a negotiable note in due course takes the note free of the usurious
taint.
Judgments. Judgments of courts of record are liens on the real
estate of the debtor within the county from the first day of the term
at which the judgment was rendered; but judgments by confession
and judgments rendered at the same term during which the action
was commenced are liens only from the day on which the judgment
was rendered. Judgments lose their priority over subsequent judg­
ments unless execution is issued and levied within one year after
judgment. A certified copy of the judgment appearing of record in
the district court may be filed in the office ot the clerk of the district

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court of any other county ana the judgment will then be a lien on
real estate in that countv. Abstracts or transcripts of justice court
Judgments may be filed in the district court oi the same county,
are liens on real estate in such county from the date of filing, after
which executions issue only out of said district court on such judgments.
Jurisdiction. (See Courts.)
License. Agents of insurance companies are required to take out
licenses from the superintendent of insurance. Cities are authorized
to enact license ordinances and certain classes of business are required
to take out a license.
Liens. Mechanics, material-men, and laborers, both original con­
tractors, and sub-contractors, and laborers of sub-contractors are
entitled to obtain liens upon real estate for labor performed or material
furnished in the erection or repair of any building. Sworn statements
Itemized as fully as practicable as to the amount of the claim, for
what and when it was rendered and by whom, giving names of con­
tractor and owuer and description of property and date of last material
furnished, must be filed in the office of the clerk of the court. Original
contractor’s lien claim must be filed within 4 months from date of
last materials, or labor furnished and others entitled to lien within
sixty days after last materials or labor furnished. Lien claimants
other than original contractors, must give immediate notice of filing
of lien claim to owner or person in possession of the premises, where
that may be done, otherwise must post notice on the premises.
Supreme court has rendered notice almost unnecessary. Action to
foreclose lien must be begun within one year after filing claim. Liverystable keepers, forwarding merchants and common carriers have liens.
(See Judgments.) Attorneys have lien on papers and funds in hand
for general balance of compensation and have lien on moneys in hands
clients adversary due client in any matter, action or proceeding, in
which the attorney was employed for services therein from the time
of service on the adverse party, in the manner of a summons, of
written notice of the lien.
Blacksmith, horseshoer, wagon maker, keeper of garage or any
other person shall have lien on any goods, chattels, horses, wagons,
automobiles, etc. for value of labor and material used thereon as long
as said property remains in his possession. Such person may retain
lien by filing statement thereof under oath in office of Register of
Deeds within thirty days after parting with possession. Such liens
hold priority over prior recorded chattel mortgages. Threshers
shall have lien on grain thrashed and same must be filed within fifteen
days from completing thrashing. Action must be brought within
ninety days after filing of thresher’s lien or same will be deemed to
have been abandoned.
Liens similar to ordinary mechanics lien are given by statute for
materials and labor furnished on oil leases in their development,
and are foreclosed in like manner.
Limitations of Suits. An action for the recovery of real property,
sold on execution or by executors, administrators, or guardians,
brought by the execution debtor, or the heirs, ward, or guardians,
within five years after the deed is recorded. Other actions for
recovery of real property, within fifteen years. On official bonds
and contracts in writing, five years. Contracts not in writing, three
years. Trespass, detinue, replevin, Injuries not arising on contract,
and relief on the ground of fraud, two years. Action for libel, slander,
malicious transaction, or false imprisonment upon a suit for penalty
or forfeiture, onj year. Action for any other relief not before
provided for. five years. In any case founded on contract, part
payment, or an express written acknowledgement or promise, renews
the contract. The statute runs from the date of such renewal. Con­
tractual limitations differing from the statutes are void.
Married Women. The real and personal property owned by a
woman at the time of her marriage, and any property which comes
to her by descent devise, or bequest, or gift of any person except her
husband, remains her sole ana separate property notwithstanding her
marriage, and , not subject to the disposal of her husband or liable
for his debts. Married women may sell and convey their real and
personal property and enter into any contract with regard to the
same in the same manner and to the same extent as a married man
may in relation to his property. She may sue and be sued in the
same manner as if she were single. She may carry on any trade or
business, perform labor or services for her separate account, and her
earnings or proceeds from labor, trade, or business remain her separate
property, and may be used and invested by her in her own name.
Her husband Is not liable for her debts incurred in her separate busi­
ness undertakings by virtue of the marriage relation. She may also
contract with her husband with the same effect as though the married
relation between them did not exist.
Mines and Mining. The law provides for the appointment of a
mine inspector with authority to require mine owners to provide
certain facilities for the health and safety of persons employed and
compel proper ventilation, regulate excavations, air courses, etc.
This law is quite elaborate and violations of the safety provisions of
the act—resulting in Injury to employees, usually results in liability
even where the Kansas Workmen's Compensation Act does not
apply, on the part of the mine operator to the employees because of
the positive duty resting on the operator to comply with such statutory
provisions
Mortgages. A mortgage of real estate, to be valid as against
subsequent bona-fide purchasers without notice, must be duly ac­
knowledged and recorded in the office of the register of deeds of the
county where the land is situated. Mortgages may be valid as against
attaching creditors without recording. Mortgages may be discharged
on margin of record by mortgagee or attorney or assignee by duly
acknowledged power of attorney or assignment in presence of register,
or by satisfaction entered on the instrument when copied on the
margin by the register; or by an independent release duly acknowledged
and recorded. Wife must join in all mortgages except those for
purchase money, except in cases where she has never been a resident
of the State. Mortgages are foreclosed by suit only. By an act
of the Legislature which took effect May 18, 1893. real estate sold
under foreclosure of mortgage is subject to eighteen month*.
Corporation mortgagor may agree in the mortgage instrument for a
shorter period of redemption or may wholly waive it. If the mort­
gage foreclosed is on abandoned property or not occupied in good
faith and the court so finds, six months only is allowed for redemption.
This act does not apply to mortgages executed prior to the date the
act took effect. When a mortgage is assigned the assignment should
be acknowledged and recorded. (For Forms, see Deeds: see Execu­
tions.)
(For Mortgages on Chattels, see Chattel Mortgages: see Execu­
tions.)
Notaries. Notaries are appointed by the Governor and serve for
four years. They give bond in the sum of $1,000 and are required
to affix the date of the expiration of their commission to all certifi­
cates.
Notes and Bills of Exchange. Uniform Negotiable Instrument
Act took effect June 8. 1905.
Partnerships. Limited or special partnerships may be formed
for any legal purpose except banking or insurance. Such partnerships
may consist of one or more persons who are general partners, and
one or more who contribute a specific amount of capital and shall
be called special partners. The special partners are not liable for the
debts of the partnership beyond the amount contributed by them
respectively but the names of the special partners must not be used
In connection with the business Such a partnership is formed by
executing a certificate stating the name, the nature of the business,
the names of the general and special partners, and their place of
residence, and the amount of capital contributed by each special
partner, and the period when the partnership is to commence and
when it will terminate. The certificate must be acknowledged and
filed and recorded in the office of the county clerk.

BANKING AND COMMERCIAL LAWS-KENTUCKY
Power of Attorney. (See Deeds.)
Probate taw. (See Administration.)
Protest. (See Notes and Bills.)
Records. (See Deeds.)
Redemption. (See Mortgages.)
Replevin. The plaintiff in an action to recover the possession of
specific personal property may claim the immediate delivery of the
same by filing affidavit and giving bond double the sworn value of
the property. Property replevined must be held by the officer taking
it twenty-four hours, during which time the party from whom the
property is taken may give bond to the plaintiff for not less than
double the amount of the value thereof conditioned for the return
of the same or its value in case it shall be adjudged the plaintiff is
entitled thereto, and thereupon may have the property returned to
him.
Service. All service of process is made by the sheriff or by con­
stables, or by some one specially authorized in any particular case,
and must be issued in the name of the state with the seal of the officer
Issuing the same affixed.
Suits. (See Actions.)
Taxes. All taxes shall be due on the first day of November of
each year, and if half of the same are not paid on or before the 20th
day of December, a 5 per cent penalty is added to the entire amount
of taxes due, and if not paid by June 20, an additional penalty of
5 per cent is added. If half of the taxes are paid by December 20,
payment of the remaining half may be deferred until June 20 of the
succeeding year without penalty. When the tax upon real estate is
delinquent it is sold for taxes on the first Tuesday in September
following. After sold it bears interest at the rate of 15 per cent
per annum and the same rate upon subsequent taxes paid and indorsed
on the tax certificate. The tax lien attaches to real estate on Novem­
ber 1, in the year in which the tax is levied. After land is sold for
taxes, it may be redeemed within three years from date of sale. The
interest of a minor may be redeemed at any time within one year
after he attains his majority, and idiots and insane persons may
redeem within five years after the sale.
A registration fee of 25 cents on each $100 of the principal debt
secured by real estate mortgage must be paid to the Resister of
Deeds when such mortgage is filed for record and thereafter such
real estate mortage and the note whicn it secures is not subject to
taxation.
Trust Companies. Trust companies may be organized with a
capital of not less than $100,000, and may receive moneys in trust
and execute any trust committed to them, either by any person or
by order of any court, and may execute or guarantee any bond required
by law to be given in any proceeding in court, and act as agent for
the investment of money, and for the purpose of issuing, registering,
transferring or countersigning certificates of stock, bonds or other
evidences of debt, act as guardian and guarantee the fidelity and per­
formance of duty of persons holding public offices or private trusts,
and certify and guarantee title to real estate and sell all kinds of
negotiable paper, and receive deposits from banks and other trust
companies or public officers. They are required to keep on hand 25
per cent of deposits subject to check and 10 per cent of time deposits,
in the same manner as state banks. Each director must be a stock­
holder in the sum of not less than $1,000. Trust companies are
under the supervision of the bank commissioner and subject to his
examination.
Trusts and Powers. All trusts concerning lands must be created
In writing except such as arise by implication of law.
Warehouse Receipts. Practically the Uniform "Warehouse
Receipts Act."
Wills. Any person of full age and sound mind and memory, hav­
ing an interest in real or personal property, may give and devise the
same to any person by last will and testament lawfully executed,
subject, nevertheless, to the rights of creditors and the estate given
a spouse by statute. Wills must be in writing, signed at the end by
the testator, or another in his presence and by his express direction,
and subscribed in his presence and at his request by two or more
competent witnesses who saw him subscribe or heard him acknowledge
it. Wills executed without the State in the manner prescribed by the
law either of the place where executed or of the testator’s domicile or
of the State of Kansas are declared legally executed. Compliance with
these requirements should appear in the witnessing clause. A will
executed, proved, and allowed in another State, in the court of
original probate, according to the laws of that State, may, relative
to property in this State, be admitted to record in the probate court
of the county in which such property is situated, by producing an
authenticated copy of the will and order of probate admitting it to
robate by the proper court of the county and State of which
eceased died a resident, after due publication of notice thereof.
Every will, when admitted to probate, shall be filed in the office of
the probate court and recorded.

§

Actions. Actions are commenced by filing in the clerk’s office
of the proper court a petition setting forth the cause of action and
causing a summons or a warning order to be issued thereon. Non­
residents and corporations, other than banks, created by laws of this
State, are required to give security for costs. In any action started
in the Circuit courts of Kentucky, the plaintiff must make a deposit
of $6.00 to cover probable costs, and a tax fee of fifty cents for the
filing of the suit must be paid. Limitations continue to run until
summons issues.
Administration of Estates. Personal estates of deceased persons
must be administered by the executors named in the will, or if these
refuse to qualify, or none are named, then by an administrator ap­
pointed by the county court of the county in which the decedent
resided at the time of his death. Administrator and executors are
required to give bond for the performance of their duties and with
surety unless otherwise directed by the will. They are required to
file an inventory of the estate within three months and to make
settlement within two years from the date of qualification and as
often thereafter as the court requires.
Affidavits. An affidavit may be read to verify a pleading, to prove
the service of a summons, notice, or other process, in an action; to
obtain a provisional remedy, an examination of a witness, a stay of
roceedings or a warning order or upon a motion. An affidavit may
e made; 1. In this State, before a judge of a court, or a justice of the
peace, examiner, notary public, clerk of a court, or master-commission­
er. 2. Out of this State, before a commissioner appointed by the
governor of this State; or before any other person empowered by a
commission directed to him by consent of the parties or by order of
the court, or before a judge of a court, a justice of the peace, a mayor
of a city, or notary public.
Appeals. Appeals may be taken from a justice’s court to the
quarterly court regardless of the amount in controversy; from the
quarterly court to the circuit court when the value in controversy,
exclusive of interest and costs, exceeds $25; from the circuit court to
the court of appeals as a matter of right in all cases in which the title to
land, or the right to an easement therein, or the right to enforce a
statutory lien is directly involved, and in all cases when the value
In controversy, exclusive of interest and costs, amounts to $500 or
more, but when such amount in controversy exceeds $200 and is less
than $500, tne party desiring the appeal may, upon payment of the
tax and filing the record in the clerk’s office of the Court of Appeals,
enter a motion that the appeal be granted. If the court upon exam­
ination of the record dei ides the appeal should not be granted,, the
motion will be overruled without a written opinion, and no petition
for a rehearing will lie entertained, but if tne court shoulu be of opinion
that the judgment be reversed then the appeal will be granted and a
written opinion will be filed. No appeal lies to the Court of Appeals
from any judgment of a quarterly, city, police, fiscal or justice’s
court, nor from any judgment of the county court.
Arbitration. All controversies which might be the subject of a
suit may be submitted to the decision of one or more arbitrators, or
two and their umpire. The submission may be in writing or by
entry of record, and the agreement of submission shall be binding on
the parties thereto, if it states the matter to be submitted and who
are to be the arbitrators. Each arbitrator and the umpire. If one
be chosen, shall take an oath to decide the matter in controversy
fairly and impartially according to law, justice and the equity of
the whole case. The award must be in writing signed by each arbi­
trator and the umpire, if any. and shall be a final settlement of the
controversy between the parties. A copy of the award must be
giveD within a reasonable time and shall be binding upon both.
Arrest. An order for the arrest of the defendant shall be made
by the court in which the action is brought or pending, at its com­
mencement. or at any time before judgment, if an affidavit of the
plaintiff be filed in his office showing: 1. The nature of plaintiff's
claim
2. That it is just. 3. The sum or value, which the affiant
believes the plaintiff ought to recover. 4. That the affiant believes,
either that, the defendant is about to depart from this State and with
intent to defraud his creditors has concealed, or moved from this
State, his property, or so much thereof that the process of the court
after judgment can not be executed; or that the defendant has money,
or securities for money, or evidences of debt, in the possession of
himself, or of others for his use, and Is about to depart from this
State without leaving property therein sufficient to satisfy plaintiff's
claim.
Assignments and Insolvency. Subject to National Bankrupt
Law
Every voluntary assignment made by a debtor to any person
in trust for his creditors shall be for the benefit of all the creditors of
the assignor, in proportion to their respective claims, after the pay­
ment of the expenses of the trust; except that property conveyed
by the deed of assignment, and upon which there is a valid lien shall
be applied first to the discharge of the lien debt; and except that
debts due by the assignor as guardian, committee, trustee of an
express trust created by deed or will, or as personal representative,
shall be paid in full before the general creditors receive anything.
The Intent of the assignor in making the deed of assignment shall
not invalidate the deed, unless he be solvent, and It appear that the
assignment was made to hinder or delay creditors. The deed vests
in the assignee the title to all the estate, real and personal, belonging
to the assignor at the time of making the assignment except that
roperty exempt by law shall not pass unless embraced in the deed.
f the assignor, before making the deed, shall have made a preferential
or fraudulent transfer, conveyance, or gift of any of his property,
or fraudulent purchase of any property in the name of another, the
property so fraudulently transferred, conveyed, or purchased shall
vest In the assignee, and it shall be his duty to Institute such pro­
ceedings as may be necessary to recover same. If. upon demand,
he refuses to do so, any creditor may, and the property so recovered
shall become a pari of the estate, and be distributed as other assets.
If creditors representing one-half in number and two-thirds of the
amount of debts against the estate shall so request in writing, the
court, shall remove the assignee and appoint another in his stead.
Attachments. The writ may issue against a defendant who is a
foreign corporation or non-resident of the State; or has been absent
from the State four months; or has left the State with intent to
defraud creditors; or has left his county to avoid service of summons;
or so conceals himself that summons cannot be served; or is about to
remove, or has removed his property or material part out of the
State not leaving enough to satisfy claim of plaintiff or defendant’s
creditors; or has disposed or is about to dispose of his property, with
fraudulent intent to cheat, hinder or delay creditors. Also in action
for money due upon contract judgment or award, if defendant have
no property in State subject to execution, or not enough to satisfy
plaintiff and collection will be endangered by delay in obtaining judg­
ment and return of nulla bona. Also in action for personal property
ordered to be delivered to plaintiff which as to part thereof has been
disposed of, removed, or concealed, so that order of delivery can not
be executed
Affidavit as prescribed by civil code and bond required,
except no bond or affidavit required in action upon nulla bona return.
Bank Collection Code. Given directly following Laws.
Banks. It is unlawful for any person or persons, either as
Individuals or co-partners to engage in or conduct the business of
private banking in this commonwealth. Corporations may be organ­
ized to conduct both a banking and trust company business. The
boards of directors of banks and trust companies doing business in
this State have full power and authority to fix the hours of opening
and closing of said banks and trust companies, and may provide
that on Saturday of each week such hour of closing be as early as
twelve (12) o’clock noon. A Department of Banking, providing for a
Banking Commissioner, deputy commissioner and examiners of State
banks, and prescribing their duties and for the examination of all

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SYNOPSIS OF

THE LAWS OF KENTUCKY
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Woodward, Hamilton & Hobson, Attorneys at Law.
615-624 Inter-Southern Bldg., Louisville, Ky.
(See Card in Attorneys’ List)
Acknowledgments. Deeds executed within the State may be
acknowledged before the clerk of the proper county court or a notary
public, or may be acknowledged before and proven by two subscrib­
ing witnesses. Deeds executed without the State and within the
United States must be acknowledged before the clerk of a court or
his deputy, notary public, mayor of a city, secretary of state, com­
missioner of deeds, or judge of a court, or before a justice of the
peace; if executed without the United States must be acknowledged
before a foreign minister, consul or secretary of legation of the United
States, or the secretary of foreign affairs, or notary public of the
nation in which the acknowledgment was made or judge of a superior
court of the nation where the deed shall be executed, attested in either
case by the officer’s seal of office. When the acknowledgment is taken,
the officer may simply certify that the deed was acknowledged before
him, and when it was done. All deeds must show a source of grantor s
title.


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2178

BANKING AND COMMERCIAL LAWS—KENTUCKY

financial institutions organized and doing business under the! laws of
the State was created by a law effective July 1st. 1912. The laws
governing the State Banking Department have been amended and
enlarged by acts of 1926. which should be consulted by those interested.
Blue Sky Daw. The Blue Sky Law of Kentucky is a comprehen­
sive regulation of the sale of corporate securities, based on the law of
Michigan. Those interested should refer to provisions of the law.
Before transacting business in Kentucky investment companies
issuing securities must file a detailed statement of their organization,
plan of business, and financial condition with the State Banking
Commissioner who has the power to investigate, approve or dis­
approve any such business proposed. Non-residents must appoint
the banking commissioner agent for service of process. Books of all
concerns must be open to inspection. Dealers must obtain licenses
from the banking commissioner who may revoke them in certain cases.
The following classes of securities are exempted from the operation
of the law: Securities issued by the United States, any foreign govern­
ment, any State or Territory or Subdivision thereof, National banks,
federal land banks or war finance corporation; public utility, exclu­
sively charitable corporations, securities listed on the New York stock
exchange or other stock exchange previously approved by the com­
missioner or securities senior thereto, securities guaranteed by a State
bank, trust company, title company, or real estate mortgage company;
negotiable promissory notes or commercial paper; 50 per cent of the
capital stock first issued by domestic corporations, where no expense
in excess of 1 per cent of the proceeds from the sale of the stock so
issued is incurred, and no part of the stock be issued in payment for
patents, good will, services, trademarks, leases, copy-rights, processes,
formulae, or other intangible assets.
Chattel Mortgages and Deeds of Trust. No deed of trust or
mortgage, conveying a legal or equitable title to real or personal
estate, shall be valid against a purchaser for a valuable consideration,
without notice thereof or against creditors, until such deed shall be
acknowledged or proved according to law, and lodged for record. It
Is a penal offense, punishable by fine and imprisonment, for any per­
son to sell or remove from the State any personal property on which
there is a mortgage of record, with the Intent to prevent the foreclosure
of the mortgage and a sale of the property.
Checks. Any person who with intent to defraud shall make or
draw or utter or deliver any check, draft, or order for the payment
of money upon any bank or depository, knowing at the time of such
making, drawing, uttering, or delivery that the maker or drawer has
not sufficient funds in or credit with such bank or other depository
for the payment of such check, draft or order in full upon its presenta­
tion; or who after having made, uttered or delivered any check, draft,
or other order for the payment of money upon any bank or other
depository shall withdraw or cause to be withdrawn, the money or
any part thereof to the credit of the maker of such draft, check or
other order for the payment of money without leaving with such
bank or other depository a sum sufficient to cover such check, draft,
or other order for the payment of money, shall be guilty of a mis­
demeanor, if the amount of such check, draft or order be under
Twenty Dollars, and if the amount of such check, draft or order be
for Twenty Dollars or over, he shall be guilty of a felony.** The
making, drawing, uttering or delivering of such check, draft, or order
as aforesaid, shall be strong prima facie evidence of intent to defraud.
Collections. Uniform Bank Collection Code as recommended by
American Bankers Association, see page 2333.
Contracts. A seal or scroll is in no case necessary to give effect
to a deed or other writing. All unsealed writings stand upon the
same footing with sealed writings, having the same force and effect,
and the same actions may be founded upon them. The State or
county seal, or the seal of a court, corporation, or notary to any
writing has not. however, been dispensed with.
Conveyances. (See Acknowledgments.)
Corporations. Formed under the general laws for transaction of
any lawful business. Special regulations prescribed for foreign cor­
porations doing business in the State, and for banking, building and
loan, trust, insurance, and railroad companies. Cumulative voting
for the election of directors prescribed. Stockholders in banks, trust
companies, guaranty companies, investment companies and insurance
companies are liable equally and ratably and not one for the other,
for all contracts and liabilities of corporation, to extent of the amount
of their stock at par value in addition to amount of such stock; but
persons holding stock, as fiduciaries, are not personally liable, but
estates in their hands are in same manner and to same extent as other
stockholders, and no transfer of stock operates as a release, of any
such liability, existing at time of transfer, provided action to enforce
the liability be commenced within two years from time to the transfer.
Articles acknowledged and recorded like deeds In countv in which
principal place of business is situated, and a copy thereof filed and
recorded in the office of the secretary of State. After such filing and
recording, and payment to State of license tax of one-tenth of 1 per
cent on its capital stock, corporation is deemed organized; but, before
transacting business other than with its own stockholders, at least 50
per cent of stock must in good faith be subscribed, payable at such
times as board of directors may require.
By act of Mar. 1, 1926, the issue of no par value stock Is permitted
where provided for in the articles and such stock is deemed fully paid
when consideration determined on by board of directors is paid.
But for purposes of corporation license or franchise taxes value is
fixed at $100.00.
In 1920 Kentucky adopted a “Blue Sky” law prohibiting the sale
of stocks or securities (with named exceptions) until approved by
the State Banking Commissioner, who requires full information on
blanks furnished by his office. The 1920 Blue Sky law has been
repealed and a new one substituted by act of March 23, 1926.
Courts. General civil and criminal jurisdiction is vested in cir­
cuit courts which hold terms in each county as provided by statute.
Credits. By an Act approved March 14, 1914, it is provided
that a person who shall knowingly in person or through any agency
make any false statement In writing with intent it shall be relied
upon, respecting his financial condition, or means or ability to pay.
for the purpose of procuring delivery of personal property, the pay­
ment of cash, the making of a loan or credit, or extension of credit,
and procures upon faith thereof either or any of the things or benefits
mentioned, shall be guilty of a felony and upon conviction, shall
be confined in the penitentiary not less than one nor more than five
years.
Days of Grace. (See Notes and Bills of Exchange.)
Depositions are the usual form of taking testimony in all equitable
actions except that the court in its discretion, may order the
testimony to be presented orally. They may be taken on all equi­
table actions and etc., and in ordinary or common law actions
where witness resides twenty miles or more from place where court
is held, or is absent from State, and in many other cases
enumerated in the statute where the witness is privileged.
Depositions are taken either on notice to opposite party or upon
written interrogatories. The ordinary method of taking is upon
notice, but where place of taking is more than one day’s travel by
ordinary methods and more than one hundred miles from the place
of sitting of court, the party receiving notice may require deposition
to be taken upon interrogatories by giving notice to that effect to
adverse party or his attorney upon same day, or day following one
upon which first notice was served. Except in divorce cases, depo­
sitions are required to be taken upon interrogatories, if all parties
against whom they are to be read have been constructively sum­
moned and have not appeared, or be defendants, or under disability
other than coverture or infancy and coverture combined. In several
other cases enumerated in the civil code, the court may require


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depositions to be taken upon interrogatories, and they may always
be so taken by consent of all parties. Officers authorized to take
depositions in this State: An examiner appointed by judge of cir­
cuit court of this district, a judge or clerk of a court, justice of peace,
or notary public. Depositions may be taken out of this State before
a commissioner appointed by governor of this State or before a
judge of a court, a Justice of peace, mayor of city, notary public,
or any other person empowered by a commission issued to him by
consent of the parties or by order of court. If deposition is taken
upon Interrogatories neither party Is allowed to be present, either
in person or by agent or attorney. The officer’s certificate must state
when and where the deposition was taken; that the witness was
duly sworn before giving it, and that it was written and subscribed
by him in officer’s presence, or was written by officer in presence
of witness and read to and subscribed by witness in presence of officer.
Descent and Distribution of Property. The real estate of a
person dying intestate shall descend in parcenary to his kindred, male
and female, in the following order, viz: (X) To his children and
their descendants; if none, then (2) to his father and mother equally
If both be living; if either be dead, the whole estate descends to the
one living; if both be dead, then (3) to his brothers and sisters and
their descendants; if none, then 14) one moiety of the estate shall
pass to the paternal and the other to the maternal kindred, in the
following order: (5) to the grandfather and grandmother, or which­
ever may be living; if both are dead, then (6) to uncles and aunts
and their descendants; if none, then (7) to great grandfather and
great grandmother, and so on in other cases without end, passing
to the nearest lineal ancestors and their descendants. (8) It there
is no kindred to one of the parents, the whole shall go to the kindred
of the other. If there is neither paternal nor maternal kindred, the
whole shall go to the husband or wife of the intestate, or if he or
she be dead, then to his or her kindred as if he or she had survived
the Intestate and died entitled to the estate. When any or all of a
class first entitled to take are dead, leaving descendants such descend­
ants shall take per stirpes, that is to say, by representation, the shares
of their respective deceased parents. Collaterals of the half blood
shall inherit only half so much as those of the whole blood. In making
title by descent, it shall be no bar to a party that any ancestor,
through whom he derives his descent from the Intestate, is or has
been an alien. Bastard can inherit in the descending line only from
the mother and her kindred, and can transmit inheritance in the
descending line only to the mother and her kindred.
Dower. (See Husband and Wife.)
Escheats. Land held by a corporation for more than 5 years,
which is not proper and necessary to carrying on its legitimate business
becomes subject to escheat. Land held by a non-resident alien for
more than 8 years becomes subject to escheat.
Executions may issue upon judgment any time until collection of
it is barred by limitation, but no execution shall issue on any judg­
ment, unless ordered by the court, until after ten days from rendition
Execution constitutes lien on property of debtor from time it reaches
hands of proper officer. Provided that such lien shall be void as to a
purchaser for value without notice unless notice of such execution
shall be filed in the office of the County Clerk. Execution may be re­
plevied for three months, any time before sale under same, by defend­
ant giving to the officer an obligation (replevin bond) payable to plain­
tiff, with good security for the amount thereof, interest and costs. A
Judgment to enforce a lien cannot be replevied. No replevy allowed
upon judgment against any collecting officer, attorney at law or
agent, for a delinquency or default in executing or fulfilling duties
of his office or place, or for failing to pay over money collected by
him in such capacity, nor against a principal by his surety, nor upon
a debt due by obligation having the force of a judgment, nor upon
judgment for specific property, or for the property, or its value.
If land sold does not bring two-thirds of appraiser’s valuation, defend­
ant and his representatives have right to redeem within a year from
the day of sale, by paying purchaser or his representatives original
purchase money and ten per centum per annum interest. Land in
which the execution defendant has a legal or equitable title or a con­
tingent remainder, a defeasible fee, may be taken and sold under
execution.
Exemptions. The following property of persons with a family
resident in this Commonwealth, shall be exempt from execution,
attachment, distress, or fee bill, namely: Two work beasts, or one
work beast and one yoke of oxen; two plows and gear; one wagon
and set of gear, or cart or dray; two axes, three hoes, one spade, one
shovel; two cows and calves; beds, bedding and furniture sufficient
for family use; one loom and spinning wheel and pair of cards; all
the spun yarn and manufactured cloth manufactured by the family
necessary for family use; carpeting for all family rooms in use; one
table; all books not to exceed seventy-five dollars in value: two
saddles and their appendages; two bridles; six chairs; or so many
as shall not exceed ten dollars in value; one cradle; all the poultry
on hand; ten head of sheep, not to exceed twenty-five dollars in value;
all wearing apparel; sufficient provisions, including breadstuff and
animal food to sustain the family for one year; provender suitable
for live stock, if there be any such stock, not to exceed seventy dollars
In value; and if such provender be not on hand, such other property
as shall not exceed such sum in value: all washing apparatus, not to
exceed fifty dollars in value; one sewing machine, and all family
portraits and pictures; one cooking stove and appendages, and other
cooking utensils not to exceed in value twenty-five dollars: ninety
per centum ol the salary, wages, or income earned by labor, of every
person earning a salary, wages, or income of seventy-five dollars or
less per month, provided that the lien created by service of garnish­
ment, execution, or attachment, shall only affect ten per centum
of such salary, wages, or income, earned at the time of service of
process; of the salary, wages, or income earned by labor, of very
erson earning a salary, wages or income in excess of seventy-five
ollars per month, sixty-seven and one-half dollars per month and
no more shall be exempt.
Tools of a mechanic, not exceeding one hundred dollars in value
libraries of ministers of the Gospel, professional libraries of lawyers
professional libraries and instruments of physicians and surgeons, not
to exceed In value five hundred dollars. In addition to personal
property there is for actual bona fide housekeepers with a family
resident in this Commonwealth a homestead exemption of so much
land including the dwelling house and appurtenances owned by
debtor as shall not exceed in value one thousand dollars. This
does not extend to a mortgage on or purchase money due for the land
or for debts or liability existing prior to the purchase of the land, or
of the erection of the improvements thereon.
Personal property or money on hand or in bank to the amount of
$750.00 shall be exempt from distribution and sale and shall be set
apart by the appraisers of the estate of an intestate to his widow and
children, or, if no widow, to his infant children or child surviving him.
The appraisers shall state in their appraisement the money or the
articles and value of each set apart by them to the widow, or Infants,
separately to the articles appraised for sale, but if the widow be present
at the time of the appraisement, or any one authorized by her in
writing, she may make her selection out of the property appraised to
the amount of said $750.00 and said appraisers shall so report. The
provisions of this section shall apply to cases where the husband dies
testate, and tne widow renounces the provisions of the will in the
time prescribed by law.
Holidays. The 1st day of January, January 19th (Robert E. Lee
Day) February 12th (Lincoln Day), the 22d day of February, the 30th
day of May, the 4th day of July, the first Monday in September (Labor
Day), the 12th day of October (Columbus Day), the 11th day of Novernber (Armistice Day), the 25th day of December of each year, and
all days appointed by the president of the United States, or by the
governor of this State, as days of fasting and thanksgiving are declared

S

BANKING AND COMMERCIAL LAWS—LOUISIANA
holidays, and shall be treated as Sunday. If any of those days named as
holidays shall occur on Sunday, the next day thereafter shall be ob­
served as a holiday.
Husband and Wife. By an act which took effect June 12, 1894,
the following important changes were made in the common law of
coverture which theretofore prevailed in Kentucky. Marriage gives
to the husband during the life of the wife no interest in any of the
wife’s property. She has full power to contract and to bind herself
and her property, except that she can not bind herself to answer
for the debt, default, misdoing of another, except as to property
set apart for that purpose by mortgage. She may sell ana dispose
of personal property as if unmarried, but may not sell or convey
real estate unless her husband unites in the contract, or conveyance
unless empowered to do so by decree of court, in case of insanity,
conviction of felony, or abandonment by the husband. After the
death of either husband or wife the survivor shall have a life estate
in one-third of all the realty of which the decedent was seized in fee
simple during the coverture unless such right shall have been for­
feited or relinquished. Such survivor has also absolute title to onehalf the personalty of the decedent left after the payment of debts.
Abandonment and living in adultery by either party, or divorce works
a forfeiture of these rights.
Interest. The lawful rate of interest Is 6 per centum per annum,
and contracts for a greater rate are void as to the excess of interest.
The Court of Appeals has refused repeatedly to allow attorneys fees
to be collected.
Judgments. A judgment does not constitute a lien on property
In this State. All judgments bear interest from their dates. Judg­
ment can be kept alive for 15 years additional by having execution
issued at any time within 15 years after date of judgment. (See
Executions and Limitations.)
Limitations.
The following are the periods within which actions
must be brought, the time commencing to run from the accrual of
the cause of action. Fifteen years: Actions to recover real property;
actions upon judgments and written contracts, except negotiable
Instruments. Seven years: Actions by senior patentees against
Junior parentees, who have held possession for seven years. Five
years: Actions upon verbal contracts; upon a liability created by
statute; actions for trespass to real or personal property or for dam­
ages for withholding same; for the specific recovery of personal prop­
erty; actions upon negotiable Instruments, though as to the makers
of an undiscounted note it is fifteen years and as to sureties seven
years; actions upon accounts between merchants, and actions for
relief from fraud or mistake and all other actions not arising on con­
tracts and not included in the 1 and 2 year statutes. Two years:
Actions upon merchant’s accounts for goods sold. One year: Actions
for Injury to person or character and for breach of promise of marriage.
Merchandise in Bulk. An Act of the 1920 Legislature provides
that when any one who shall buy any stock of goods in bulk or fixtures
before he shall deliver to the vendor the purchase price or any promis­
sory note therefor shall obtain from the vendor a verified written
statement of all the creditors of the vendor together with their addresses
and the amount of indebtedness due to each, also an accurate in­
ventory of the stock or fixtures to be purchased and making it the
duty of the vendor to furnish such statement under oath. Upon
receiving such a statement the purchaser shall notify, personally or
by registered mail, each of the creditors of said vendor as appears
on the list, of the proposed sale, the price to be paid therefor, the
conditions of the sale and a copy of the statement furnished by the
vendor. This notice shall be given or sent at least ten days before the
completion of the sale. If any such purchaser fails to obtain a verified
statement from the vendor or to give the notice to the creditors as
above or to see that the proceeds of the sale are prorated among
creditors according to dignity of their claims then such sale or transfer
shall be fraudulent and void and shall operate as a general assignment
for the benefit of the creditors of the vendor and the purchaser shall
at the suit or option of the creditor be held liable to the creditors for
the fair value of all property so bought or sold, provided, however,
such suit must be brought within four months.
Notes and Bills of Exchange. The uniform negotiable instru­
ments law was enacted June 13, 1904. Section 1 declares that an
Instrument to be negotiable must conform to the following require­
ments. (1) It must be in writing and signed by the maker or
drawer. (2) Must contain an unconditional promise or order to
pay a certain sum in money. (3) Must be payable on demand, or
at a fixed or determinable future time. (4) Must be payable to the
order of a specified person or to bearer. (5) Where the instrument
Is addressed to a drawee, he must be named or otherwise Indicated
therein with reasonable certainty. Days of grace are abolished.
The signature of any party may be made by an agent duly authorized
in writing thus differing from the uniform negotiable instruments
law as enacted elsewhere. Every negotiable instrument is payable
at the time fixed therein; when the day of maturity falls upon Sunday,
or a holiday, the instrument is payable on the next succeeding business
day. The Negotiable Instruments Law has been amended and
enlarged by Acts of 1930 which should be consulted by those interested.
Powers of Attorney. Powers of attorney to convey real or per­
sonal property may be acknowledged, proved and recorded in the
proper office in the manner prescribed for recording conveyances. If
the conveyance made under a power is required by law to be recorded
or lodged for record to make the same valid against creditors and pur­
chasers. then the power must be lodged or recorded in like manner.
Protest. Where any negotiable instrument has been dishonored
It may be protested for non-acceptance or non-payment as the case
may be; but protest Is not required, except in the case of foreign bills
of exchange. It Is the safer practice to protest in all cases, because
In all cases notice of dishonor is necessary to charge parties secondarily
liable.
Sales. On March 24,1928 the uniform sales act drawn by Professor
Williston was enacted without change from the original as drawn by
Professor Williston.
Taxes. State and County taxes in Kentucky for any year are a
lien agaiust real estate from and after July 1st of the preceding year.
The cities and towns of Kentucky are divided into six classes and the
liens of the various classes for taxes on real estate date from the
following:
First Class, September 1st for succeeding year.
Second Class, July 1st, for succeeding year.
Third Class, from date fixed by City Council for succeeding year
Fourth Class, April 1st for current year.
Fifth Class, September 15th for succeeding year.
Sixth Class, July 1st for succeeding year
Taxes due the State by banks and trust companies are payable
directly into the State treasury on or before the first day of July
succeeding reports by their chief officers required to be made to
auditor of public accounts, and taxes to countiesi cities, towns and
districts are paid at the time fixed by law for payment of like taxes.
Unclaimed Bank Deposits. Every bank organized under the
laws of Kentucky or doing business under any laws of Kentucky, must
annually, in January, publish in at least two issues of a newspaper
published in the County in which the bank is located, a statement
under oath of its Cashier, of all deposits made with it and of all the
dividends and interest declared and payable by it which, at the date
of such statement, have remained unclaimed by any person authorized
to receive the same for five years giving the time when, and the
name of, the person by whom the deposit was made and the name of
the person in whose favor the dividend or interest was declared and
when and from what source derived.


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2179

Wills. Any person of sound mind and over twenty-one years of
age may make a will. Wills must be in writing with the name of
the testator subscribed thereto either by himself or by some other
erson in his presence and by his direction. If not wholly written
y the testator the subscription must be made or the will acknowledged
by the testator in the presence of two witnesses, who shall subscribe
their names in the presence of the testator. The will of a person
domiciled out of this State is valid as to personalty, if executed accord­
ing to the law of the domicile; but to be valid as to lands, it must be
executed as required by the law of this State. The county court
has exclusive original jurisdiction over the probate of wills. Holo­
graphic wills are valid.

g

SYNOPSIS OF

THE LAWS OF LOUISIANA
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Messrs. Merrick, Schwarz. Gdste, Barnett & Redmann
Attorneys at Law, Canal Bank Bldg., New Orleans.
(See Card in Attorneys’ List.)
Accounts. (See Acknowledgments.)
Acknowledgments. The uniform foreign (Act 154 of 1916), and
domestic (Act 226 of 1920) acknowledgment laws have been adopted.
Acknowledgments mav be taken within the state by a notary
public or by a recording officer.
Acknowledgments may be taken in the United States, outside of
the state, by any judge, justice of the peace, notary, commissioner for
Louisiana, or by any officer authorized to take acknowledgments
where he acts.
Acknowledgments may be taken in foreign countries by any am­
bassador. minister, envoy or charge d’affairs of the United States, in
the country to which he is accredited, or before any officer of the
United States, a notary public, or a commissioner or other agent of
Louisiana authorized to take acknowledgments, if such officers have
an official seal, and are commissioned or accredited to act where the
acknowledgment is taken.
Any commissioned officer of the army or navy of the United States
is authorized to take acknowledgments in any foreign country in which
he may be serving. (Act 192 of 1918.)
All acknowledgments taken within the United States must be
witnessed by two witnesses over the age of fourteen years, who must
subscribe the certificate of acknowledgment. If the party making
acknowledgment be blind, three witnesses are required. Witnesses
are not necessary when acknowledgments are taken outside of the
United States. The officer taking the acknowledgment must not act
as a witness. While a female may act as a witness, this is of doubtful
advisability.
The acknowledgment of a married woman may be taken as though
•he were single, separate examination being unnecessary.
No authentication is required of certificates of acknowledgments
taken in the state, or taken in foreign countries, or taken in the United
States by notaries public, or commissioners for Louisiana, under their
official seals. Certificates of acknowledgments taken in the United
States before other officers must be authenticated by a certificate of
a secretary of state as to the capacity of the officer.
Authentication for use out of the state may be by the secretary of
state, whose fee is one dollar, or by any clerk of a court of record,
civil district or federal court, whose fee is fifty cents.
Actions. Commenced by petition setting forth cause of action,
articulated in numbered paragraphs, signed by plaintiff or his attorney
and duly sworn to. Plaintiff must give resident security for costs or
make deposit to cover same if demanded. (See Act 300 of 1914
regulating pleadings and practice as amended by act 27 of 1926.)
After filing of petition, defendant is cited to appear ten days after re­
ceipt of citation in District Courts and Justice of Peace courts outside
of city of New Orleans. One day additional for every ten miles his
residence is distant from court. Delay in no case to exceed fifteen days.
In city courts of New Orleans, defendant must appear three days after
receipt of citation. Neither day of service nor day on which answer
must be filed is included in delay. If defendant fails to appear, judge­
ment by default is rendered against him. In district courts such judge­
ment is confirmed two judical days after preliminary entry of default.
In Justice of Peace courts judgment of default is confirmed the same
day as that on which default is entered.
Administration of Estates by executors, administrators, or tutors
who are ex-officio administrators—also by dative executors—where
there is no heir present or agent of heir, public administrator takes
charge in New Orleans. A non-resident executor of a will must in all
cases give hond; a resident does not unless required by creditors.
Administrators and executors of other states must open succession of
deceased in the courts of this State, and be recognized as such here
before they can sue or be sued or transfer property in this State. Stock
in local corporations may be transferred by non-resident executors,
etc., without the necessity of securing an order from the local court, but
no transfer can be made until the inheritance tax is adjusted. No
debts can be paid by administrator without authorization of probate
court. The administrator or executor presents to the court an
account or tableau of distribution setting forth the payments and
disbursements he proposes to make. Parties interested are notified
by publication to show cause within ten days why the account so filed
should not be approved. Any party interested may oppose the
account by opposition in writing at any time within the said ten days
In absence of opposition account is homologated upon production of
satisfactory evidence by administrator or executor, and the funds
ordered distributed in accordance therewith.
Claims against estates should be presented in writing to the admin­
istrator or executor. Should he approve the same in writing, no
further action is required except to see that the claim is placed upon
his account when filed. Should he decline to recognize the claim,
creditor may file suit against succession representative and obtain a
Judgment to be paid in ordinary course of administration. If there
is no danger of prescription, creditor may await filing of account and
then oppose same if claim is not included.
Affidavits. (See Acknowledgments.)
Aliens. No alien who is ineligible to citizenship of the United
States may hold land or any real right. Aliens may not vote.

2180

BANKING AND COMMERCIAL LAWS-^LOUISIANA

Arbitration. Agreements to submit to arbitration recognized by
law. “Louisiana Arbitration act” adopted Act 262 of 1928. Arbi­
trators must be sworn, otherwise decision is not binding. State board
of arbitration of labor troubles established. (Act 139 of 1894.]
Assignments and Insolvency. State insolvent laws superseded
by National Bankruptcy act.
Attachment. Writs of attachment issue on application of credi­
tor, under oath, when debtor about permanently leaving state, without
possibility in ordinary course of obtaining or executing judgment
previous to departure, or when such debtor has already left state
permanently, when the debtor resides out of the state; when he
conceals himself to avoid being cited; when he has mortgaged, assigned
or disposed of, or is about to mortgage, assign, or dispose of his prop­
erty, rights, or credits, or some part thereof, with intent to defraud
his creditors or give an unfair preference to some of them; and when
he has converted, or is about to convert, his property into money
or evidences of debt with intent to place it beyond the reach of his
creditors, or, if debt not due. is about to remove his property out
of the State. Creditor must furnish bond equal to the amount claimed
to be due, with at least one solvent surety, residing within the juris­
diction of the court, conditioned for payment to any party injured by
issuance of writ of all damages sustained by him in case it is decided
that the attachment was wrongfully obtained. (Act 119 of 1916).
Bond for $260 is sufficient if debtor resides outside of state but bond
may be increased to amount of claim upon order of court at demand
of debtor. Garnishment may be had as an accessory either to a writ
of attachment or fieri facias Attachment may now issue for an offense,
quasi offense or tort if defendant is non-resident (Act 215 of 1920).
Banks. Banking corporations organized under banking laws
adopted in 1855, amended in 1888, in 1892, and in 1902. Savings,
deposit, and trust companies provided for by Act 150 of year 1888,
amended by Act 95 of 1892, which is now amended by Act 189 of 1902.
The number of persons organizing must be five or more. No special
legislative act of incorporation can be passed. By Act 189 of 1902,
the general banking act of 1855 and the amendatory acts of 1888 and
of 1892 are amended as follows: 1. Period of time must be fixed in
charter not to exceed ninety-nine years. 2. Banks can not hold real
estate for longer time than five years, except such as necessary for
the transaction of their business, or except that held as agent or
trustee. 3. All managers and directors shall be citizens of Louisiana.
4. Safe deposit and trust banks without power to issue bank notes,
may be organized under this law with a capital of $50,000 or more,
of which capital at least $10,000 shall be paid up before commencing
business. In incorporated towns with less than 20,000 inhabitants
must have cash capital of not less than $30,000, which must be paid
up before can commence business. It may be made a receiver,
trustee, assignee or syndic, and execute trusts of every description.
Money or other valuables deposited by married women or minors
may be drawn out without the authority of their husbands or tutors.
Under Act 45 of 1902, banks organized to do a savings, safe deposit
and trust banking business must be composed of more than five
persons, may be organized for not longer than ninety-nine years,
may not hold real estate for longer period than ten years, except
such as is held as agent or trustee, or necessary for transaction of
their business; may accept and execute trusts or agencies of all descrip­
tions, may be appointed by any person or by court, executor, admin­
istrator, syndic, receiver, curator, tutor, trustee or assignee. Capi­
tal stock considered as security for faithful performance of duty,
though court may require other security, and may require the state
examiner of banks to investigate the affairs and management of
the bank. Such banks can not issue notes and must have a capital
not less than $100,000, which must be paid up in cash. (See Act 121
of 1910, amending Act 45 of 1902 as to capital required in cities of
less than 30,000.) (See also Act 179 of 1902, and amendment thereof.
Act 140 of 1906 and amendment thereof, Act 152 of 1910 and amend­
ment thereof. Act 96 of 1912 and Act 184 of 1916.) Act 238 of 1910 and
Act 146 of 1926 amending Act 45 of 1902, provides for branches. Act
112 of 1910 creates a State Banking Department having supervision
over all state banks. Amended by Act 48 of 1912. (See Act 70 oi 1918
to require banks or trust companies organized under Act 45 of 1902 to
use word ‘trust’ as part of name ; Act 86 of 1926 exempting state and
national banks located in this state from liability as forwarders
for collection of negotiable or non-negotiable papers or securities; Act
92 of 1918 as to maintaining money reserve and cash on premises to
take care demand deposits.)
Chattel Mortgages. As provided for by Act 198 of 1918, any
kind of movable property may be mortgaged for debts, for money
loaned, future advances or to guarantee contractual obligations.
The act oi mortgage must be passed before a Notary Public ana two
witnesses and must be recorded in Parish where property is situated
and Parisn where mortgagor resides in order to affect third persons
without notice. Chattel so mortgaged cannot be transferred from
one parish of the State into another without written consent of
mortgagee. Inscription of chattel mortgage must be renewed within
five years.
Collaterals must be delivered to be effectual. Act 9 of 1914
makes it a felony for a customer of bank to wrongfully dispose of
collateral security pledged to bank. Uniform Bills of Lading law
obtains. (Act 94 of 1912.)
Conditional Sale. Act 119 of 1918 makes lawful a conditional
sale of tank cars providing for retaking of car by conditional vendor
without right of redemption being given to vendee, all payments of
such date of retaking being forfeited. Act 111 of 1894 provides for
conditional sale of railway equipment. Other conditional sales of
movable property are ineffective as between the parties or innocent
third persons.
Conveyances. All agreements affecting real property must be
in writing, and transfers and mortgages, etc., must De recorded in
the place where the property is situated to affect the rights of third
persons. Deeds are made under private signature or by act passed
before a notary public in the presence of two witnesses. Both vendor
and vendee sign, though signature of vendee is not essential, as any
act of acceptance will answer. The notary in Parish of Orleans pre­
serves the originals of deeds passed before him and certified copies
given by him are received as evidence in the courts. Every notarial
deed should contain (1) date of act and place where it was passed. (2)
names and surnames and qualities of contracting parties, (3) descrip­
tion of the property, etc., (4) price of transfer and terms and conditions.
(5) The marital status, of all parties must be given
Married women
may now dispose of separate property without authorization of husband
or court. The husband acts alone in the sale of community property;
the signature of the wife being unnecessary
Either husband or wife,
if husband refuses to do so, may designate family home by registration.
If so designated, wife’s signature necessary to pass title.
Corporations. Any number of persons, exceeding six, may form
themselves into corporations for literary, scientific, religious, and
charitable purposes; for works of public improvement, and generally
all works of public utility and advantage; and any number of persons,
not less than three, may form themselves into a corporation for the
purpose of carrying on mechanical, mining, or manufacturing business,
except distilling or manufacturing intoxicating liquors, with a capital
not less than $5,000 or more than $1,000,000. Any number of per­
sons not less than three may form themselves into a corporation on
complying with the general corporation laws, for ene purpose of carry­
ing on any lawful business or enterprise not otherwise specially pro­
vided for. excel)t banking and insurance, homestead and building
and loan associations. By act 250 of 1928 the corporation law of
Louisiana has been largely revised, generally along the lines of the
uniform corporation law but with distinctive features. The act is
effective as from January 1st. 1929. The legislature can not pass a
special act conferring corporate powers. Corporation committing a
trespass or damage may be sued at place where it occurred. [Act 130


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of 1926.] (See Act 154 of 1902 for formation of corporations for works
of public improvement.) Act 120 of 1902 provides for organization,
etc., of local and foreign building and loan or homestead associations.
No corporation can declare dividends out of its capital stock. Annual
meetings of corporations may be held anywhere within or without
the state.
Foreign Corporations may be licensed and taxed by a mode differ­
ent from that provided for home corporations. No domestic or for­
eign corporations shall do any business in this State without having
one or more known "places of business and an authorized agent or
agents in the State upon whom process may be served. All corpora­
tions (except mercantile corporations) domiciled out of the State and
doing business in the State in default of filing with the secretary of
state a declaration of the place of its locality or domicile together with
a resolution authorizing the appointment of an agent together with
a power of attorney appointing an agent in the State upon whom
service of process may be made, may be sued upon any cause of action
in any parish where the right of action arises and such corporation
must show its principal place of business and the places of business
It proposes to have in Louisiana.
Foreigm corporations must file in office of secretary of state a written
declaration setting forth and containing the place or locality of its
domicile, the places in the State where It is doing business, and the
name of its agent or other officer in this State upon whom process may
be served. (Act 54 of 1904 amended by Act 284 of 1908. Act 284
of 1908 amended by Act 243 of 1912. See Act 194 of 1912.)
Act 107
of 1922 requires foreign corporations doing business in this state to
pay a tax of one-twentieth of 1 per cent on the amount of the capital
stock employed in this state. Act to operate prospectively only.
As to non trading corporations, see Act 259 of 1914.
Courts. Terms and Jurisdiction. In parishes other than Orleans;
Justices' courts, concurrent with District courts up to $100. 2.
District courts, concurrent with justices' courts, up to $100. exclusive
for all civil matters over $100, and in all probate matters and appellate
jurisdiction in all civil matters in justices' courts. In Orleans parish,
1 City courts, exclusive up to $100. Concurrent with Civil District
com-, rrorn $100 to $300. 2. Civil District court, concurrent up to
$300, exclusive over $300. Justices and city courts open at all times,
in parishes other than Orleans, district courts shall hold continuous
sessions during ten months of the year. In parish of Orleans, civil
district court sits during 9 and A months of the year, but shall remain
open on all legal days during the whole year for granting interlocutory
orders issuing writs, trials of rules to quash same, trying proceedings
instituted or on appeal therein bv a landlord for the possession of
leased property, partition proceedings, and for sucn special probate
and insolvency business as the courts en banc may by rule determine.
On all amounts up to $2,000 inclusive, and in suits for damages or
death caused by wrongful injury, an appeal may be taken to the
court of appeals, from the city and district courts respectively, and
on all amounts over $2,000, except suits for damages or death caused
by wrongful injury, to the state supreme court. An appeal lies on
both law and facts. Appeals from the city courts shall be tried de
novo, except suits for amounts between $100 and $300.
Days of Grace. Abolished.
Depositions. To take testimony of witness residing out of parish
or State it is necessary to file motion duly sworn to showing non-resi­
dence and materiality of evidence. Written interrogatories are preared and served on opposite party, or his counsel, who has three days
l which to cross. Commission then issues, directed to some proper
officer, with interrogatories and cross interrogatories annexed, who
must cause witness to appear before him to answer under oath the
direct and the cross interrogatories. He should reduce answer to
writing, read same to witness and cause witness to sign same. The
officer then prepares a process verbal of the whole, attaches It to the
commission, interrogatories, etc., and should return same to the court
Issuing the commission within the time fixed therein for taking the
deposition. The deposition of a fugitive from justice is not admissible
in evidence. (Also see Act 176 of 1910 and 98 of 1926.) The uniform
foreign depositions act has been adopted (Act 34 of 1922).
Descent. If one dies leaving no descendants, but a father and
mother and a brother and sister, or descendants of these last, the
succession is divided Into two equal parts, one goes to father and
mother, the other to brothers and sisters or their descendants. If
either father or mother of deceased dies before him, the portion which
would have been inherited by such deceased parent goes to the.
brothers and sisters of the deceased, or tneir descendants. If deceased
left neither descendants nor brothers nor sisters, nor descendants from
them, nor father nor mother, but only other ascendants, they inherit
to the exclusion of all collaterals. If ascendants in paternal and
maternal lines are all of the same degree, the estate is divided into
two parts, one goes to ascendants on the paternal and the other to
ascendants on the maternal side. If there is in the nearest degree
but one ascendant in the two lines such ascendant excludes all other
ascendants of a more remote degree
If one dies leaving no descen­
dants, and his father and mother survive, his brothers and sisters,
or their descendants, take half of his estate. If the father or mother
only survive, brothers and sisters, or their descendants, take threefourths. If one dies leaving no descendants nor father nor mother,
his brothers and sisters, or their descendants, take all the estate.
The partition of the half, the three-fourths, or the whole of a suc­
cession falling to brothers and sisters as above set forth, is made equal
If they are of the same marriage if of different marriages the succession
Is equally divided between the paternal and maternal lines of the
deceased. If deceased died without descendants, leaving neither
brothers nor sisters, nor descendants from them, nor mother nor
father, nor ascendants in the paternal or maternal lines, his succession
passes to his other collateral relations, the one nearest in degree
excluding the others. When the deceased has left, neither lawful
descendants nor lawful ascendants, nor collateral relations, the law
calls to his Inheritance either the surviving husband or wife, or his
or her natural children, or the State. If natural mother left no
lawful children or descendants, her natural children, acknowledged
by her, inherit to the exclusion of her father and mother and other
ascendants or collaterals of lawful kindred. Natural children Inherit
from their natural father, who has acknowledged them, when he has
left no descendants nor ascendants, nor collateral relations, nor
surviving wife, and to the exclusion only of the State. Donations
inter vivos or mortis causa cannot exceed two-thirds of the property
of the disposer if he leaves at his decease a legitimate child, one-half
If he leaves two children, and one-third if he leaves three or more.
If he leaves no descendants hut a mother or father or both, cannot
exceed two-thirds. The remaining half, third or fourth, as the cas*
may be is the legitime of the child or children and father and for
mother. Tax: To descendants, etc., 2 per cent from $5,000 to
$20,000, 3 per cent above $20,000. To collaterals, 5 per cent on
$1,000 to $20,000, 7 per cent above $20,000. To strangers 5 per
cent from $500 to $5,000, 10 per cent above $5,000. Exemptions:
$5,000 for direct descendant, ascendant, or surviving spouse, $1,000
to collaterals, $500 to strangers. Bequests to educational, religious
or charitable institutions located within the state are exempt.
R. C. C. 915 amended to read, “When either husband or wife shall
die, leaving neither a father nor mother nor descendants, and with­
out having disposed by last will and testament of his or her share
of the community property, such undisposed of share shall be inherited
by the surviving spouse in full ownership. In the event the deceased
leave descendants his or her share in the community estate shall
be inherited by such descendants in the manner provided by law.
Should the deceased leave no descendants, but a father and mother,
or either, then the share of the deceased in the community estate
shall be divided in two equal portions, one of which shall go to the
father and mother or the survivor of them, and the other portion shall
go to the surviving spouse.

S

BANKING AND COMMERCIAL LAWS—LOUISIANA
Divorce. (See Separation from Bed and Board.)
Dower. (See Married Women.)
Employers Liability Act. There is a general Employers Liability
Act in the State setting forth special compensation for various injuries.
Execution. Property taken under a writ of fieri facias must be
advertised and appraised, and can not be sold for less than two-thirds
of the appraised value, until it has been re-advertised. Advertise­
ments of movables three times in ten days—of real estate once a
week for thirty days. If two-thirds of appraised value is not bid,
property must be re-advertised for fifteen days, and sold on a credit
for twelve months for whatever it will bring. There Is no redemption
of property sold under execution or mortgage. No stay of execution
is given except on appeal, and execution may issue at any time after
the delay for appealing suspensively has expired. Act 113 of 1906
authorizes sheriffs and constables to put purchaser of seized property
In possession. On proper petition the court can order an examination
of a Judgment debtor as to ills assets and liabilities. (Act 198 of 1924.)
Exemptions. To head of family, real estate if owned and occupied
as a residence, together with certain furniture, stock, implements,
provisions, etc., the property not to exceed $2,000. means or property
of wife deducted from exemption of husband. If the property' exceeds
$2,000 in value, it may be sold. Beneficiary entitled to $2,000 of
proceeds. No registry required in parishes other than Orleans.
Surviving spouse or minor hild or children may claim benefit of this
exemption. Widow or minor children surviving, entitled to $1,000 out
of deceased husband's estate, if in necessitous circumstances, by pre­
ference over all other debts except those secured by vendor's privilege,
conventional mortgage, and expenses incurred in selling the property.
Sheriff or constable can not seize linen and clothes of debtor or his wife,
nor his bed. nor those of his family, nor his arms and military accoutre­
ments, nor tools and instruments and books, sewing machines necessary
for the exercise of his or her calling, trade, or profession, by which he
or she makes a living, the right of personal servitude, of use and
habitation, of usufruct to the estate of a minor child, the income
of dotal property, wages or recompense for personal service (laborers’
wages) cooking stove, plates, etc., family portraits, musical instru­
ments played on by family. (Act 184 of 1918). Also proceeds of
life, health and accident insurance exempt, except for debt secured
by pledge of policy or rights under policy. (Act 88 of 1916).
Fraud vitiates all contracts. Action barred by one year limitation
to annul sale on account of fraud. For fraud on part of purchasers
of goods see Act 114 of 1912 amending Act 94 of 1896 and Act 269
of 1914.
Garnishment. Wages earned out of this State and payable out
of this State, shall be exempt from attachment or garnishment in all
cases where cause of action arose out of this State, and it shall be the
duty of garnishees in such cases to plead such exemptions unless the
defendant is actually served with process. (Act 165 of 1904.) (See
Attachment.)
Holidays. Sundays. January 1st, January 8th. February 22nd,
Good Friday. June 3rd, to be known as Confederate Memorial Day.
July 4th, first Monday in September, to be known as Labor Day, Octo­
ber 12th, to be known as Christopher Columbus Day, November 1st,
Thanksgiving Day, as designated by the President of the United States,
November 11th, to be known as Armistice Day. December the 25th:
in the Parishes of Orleans, St. Bernard, Jefferson, St. Charles and
St. John the Baptist. Mardi Gras, and in cities of over 6,000 popula­
tion, Saturdays from 12 o’clock noon until 12 o'clock midnight. When
a holiday falls on Sunday, the following Monday is a legal holiday in
cities over 6,000.
Husband and Wife. tSee Married Women.)
Interest. Legal rate is 5 per cent, but 8 per cent may be agreed
upon in writing. If higher than 8 per cent is charged, it is reducible
to 8 per cent. If paid, it may be sued for and recovered within two
years.
Judgments recorded in the office of the parish recorder become
mortgages from date of record upon all real estate of the debtor, and
may be thus recorded in any parish where debtor owns reai estate.
They are valid for ten years, when they must be renewed.
Liens or Privileges. The following have special privileges, viz.:
1. Ijessor’s privilege. 2. Privilege of the creditor on the thing
pledged. 3. Privilege of a depositor on the price of a thing deposited.
4. Privilege for expenses incurred in preserving thing. 5. Privilege
of the vendor of movable effects so long as they are in the possession
of the vendee. 6. Privilege of the innkepeer on the effects of the
traveler. Privileges resting upon immovables are as follows, viz.:
1. The vendor on the estate by him sold, for the payment of the
price or so much of it as is unpaid, whether it was sold on or without
a credit. 2. Architects, undertakers, bricklayers, painters, master
builders, contractors, sub-contractors, journeymen, laborers, cartmen, and other workmen employed in constructing, rebuilding, or
repairing houses, buildings, or making other works. 3. Those who
have supplied the owner or other person employed by the owner,
his agent, or sub-contractor, with materials of any kind for the con­
struction or repair of an edifice or other work, when such materials
have been used in the erection or repair of such houses or other works.
(Art. 3252.) Privilege on crops to be recorded (Act of 1890.) The
vendor of an agricultural product of the United States has a five days'
privilege for unpaid purchase price in preference to all others. Privi­
lege granted employes in saw mills etc. (Act 145 of 1888 amended
by Act 62 of 1910 and Act 23 of 1912.) Laborers have lien on oil and
gas wells, rigs and machinery for wages. (Act 171 of 1928.) Widow
and children left in necessitous circumstances are entitled to an amount
in husband's or father's succession sufficient to make $1,000 inclusive
of property already possessed by them. This privilege primes all
others except vendor's privilege, that for expenses of selling property
and conventional mortgages, representing money actually loaned for
not less than one year at not exceeding 6 per cent for interest, dis­
count and charges.
Limitation of Actions. Limitation of actions, or prescription,
under the law of Louisiana is a manner of acquiring ownership of
property, or of discharging debts by the effect of time and under the
conditions regulated by law
Of the prescription by which the ownership of property is acquired.
He who acquired an immovable in good faith and by a just title pre­
scribes for it in ten years, provided he has had continuous and
uninterrupted possession during that time. This runs against minors
in twenty two years from birth and all others excepted by law. Act
161 of 1920.
The ownership of immovables is prescribed for by thirty years
without any need of title, and without reference to good faith, pro­
vided there has been continuous and uninterrupted possession as
owner during this time.
If a person is possessed in good faith, and by a just title of a movable
during three years without interruption he acquires the ownership
by prescription, unless the thing was stolen or lost.
When the possessor of any movable whatever has possessed it for
ten years without Interruption he shall acquire the ownership of it
without being obliged to produce a title, or to prove that he did not
act in bad faith.
Prescription runs against all persons unless they are Included in
some exception established by law.
Minors and persons under interdiction cannot be prescribed against
except in certain cases provided by law.
Husbands and wives cannot prescribe against each other.


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2181

Of the prescription which operates a release from debt. Various
actions 8re prescribed by one year. Among these may be mentioned
those of masters and instructors for lessons wnich they give by the
month. Those of inn keepers, on account of lodging and board which
they furnish. Those of retailers of liquors. Those of workmen,
laborers and servants, for the payment of their wages, and actions
for injurious words, whether verbal or written. Those for damages
caused by animals, and all actions for damages or torts.
This prescription runs against minors and interdicted persons,
reserving, however, to them their recourse against their tutors and
curators.
Actions by or against common carriers for collection or recovery
of freight charges or for loss of or damage to freight are prescribed by
two years from date of shipment.
The following actions are prescribed by three years, to wit: First—
That for arrearages of rent charges, annuities and alimony, or for hire
of movables and immovables. Second—That for payment of money
lent. Third—That for the salaries of overseers, clerks, secretaries
ana of teachers who give lessons by the year or quarter. Fourth—That
of physicians, surgeons and apothecaries for visits, operations and
medicines. Fifth—That of parish recorders, sheriffs, clerks and
attorneys for their fees and emoluments. Sixth—That on accounts
of merchants. Seventh—That on all other accounts. Eighth—Tax
inscriptions. Ninth—Licenses. Tenth—Inheritance taxes as against
purchasers and third persons in good faith.
This prescription runs against minors and interdicted persons,
reserving to them, however, their recourse against their tutors and
curators.
Four years’ prescription applies to special action—as action of minor
against tutor respecting acts of tutorship; of minor for rescission of
judgment; action of lesion.
The following actions are prescribed by five years, to wit: Actions
on bills of exchange, notes payable to order or bearer, except bank
notes. Those on all effects negotiable or transferable by endorsement
or delivery, and those on all promissory notes negotiable or otherwise.
Inheritance taxes as against heirs in five years from opening of suc­
cessions.
This prescription runs against minors and Interdicted persons,
reserving to them, however, their recourse against their tutors and
curators.
Second—Actions for the nullity or rescission of contracts, testaments
or other acts.
Third—Actions for the reduction of excessive donations.
Fourth—Actions for the rescission of partitions.
All informalities connected with or growing out of any public sale
made by any person authorized to sell at public auction, shall be
prescribed against by those claiming under such sale after the lapse
of five years from the time of making it. whether against minors,
married women or interdicted persons.
All personal actions, except those above enumerated, are prescribed
by ten years.
Actions for mmovable property, or for an entire estate, as a suc­
cession, are prescribed by thirty years.
Limitation on Tort Actions. All actions on torts are prescribed
by one year.
Limitations to Suits.
Prescription — Accounts stated and
acknowledged in writing are prescribed only by ten years. (Act of
1888.) Personal actions one year: action for torts of all kinds; for
Injury to or non-delivery of merchandise shipped on vessels; for fees
of justice, notary or constable; for innkeepers' accounts; for accounts
of retailers of liquors: for wages of laborers or sailors; for freight; and
for tuition by month. Three years: Action for arrearages of rent
charges, or hire of movables or immovables or money lent; for salaries
of overseers, clerks, or tuition by quarter or year; for fees of physicians
apothecaries, attorneys, sheriffs, clerks, and recorders; on open
accounts of merchants, whether wholesale or retail, and others. Four
years: Actions by minors against their tutors, counting four years
from majority. Five years: Action on bills of exchange or promissory notes, counting from maturity, and for nullity of contracts or
wills; for reeision of partitions; to set aside public and judicial sales
for informalities. Ten years: All other actions; the right to a usu­
fruct or servitude, all judgments, whether rendered within or without
the State, but judgments may be revived before lapse of ten years,
and are then good for ten years from date of revival. Prescription of
ten and thirty years now runs against minors, interdicts and married
women (Act 161 of 1920). Husband and wife can not prescribe
against each other. Promise to pay or payment on account will
interrupt prescription. Only written promise to pay will revive
when prescription has accrued.
Limited Partnerships. (See Partnership.)
Married Women. Act 132 of 1926 and Act 283 of 1928 provide
that a married woman, whether a resident of this state or not, shall be
competent to contract debts, purchase, sell and mortgage, and to bind
and obligate herself personally and with reference to her separate and
paraphernal property; to appear in court and to sue and be sued; to sell,
alienate or otherwise dispose of, and to mortgage and pledge, or other­
wise encumber, her separate and paraphernal property for the benefit of
herself, her husband or any other person, and to bind and obligate her­
self personally or as surety for her husband or any other person; and
that such rights may be exercised without the necessity of obtaining the
authority of her husband or the judge; provided, however, that the
rights granted by said act shall not apply to married women under
the age of eighteen years or to married women who are interdicted,
nor shall anything therein contained be deemed or construed to affect
in any way the statutes of t his state establishing and regulating the
matrimonial community of acquets and gains and prescribing what
shall be deemed separate property of the spouses. Revenues of all
separate property administered by the husband, and all property
acquired by either husband or wife after marriage, except by donation
or inheritance constitute part of community, unless bought with the
separate means of either and as a separate acquisition. Wife has no
dower in her husband's real estate. The wife can have no claim upon
the property of the husband to the prejudice of third parties, unless
recorded. Where one of the spouses is agent for the other, he or she
may be witness for the other in a matter connected with that trans­
action. Act 167 of 1916 permits but does not compel one spouse to
be a witness either for or against the other in any proceeding, civil or
criminal. After dissolution of marriage by death or divorce the
survivor is entitled to one-half of all property remaining after payment
of debts, acquired during marriage, and in case of death, if there is
issue, the usufruct of the other half, unless this half is disposed of by
will of deceased spouse. Wife cannot be a witness to husband's will.
(See “Liens and Privileges.")
Monopolies or Trusts are regulated and rights are given against
them similar to those existing under Federal Law. The state author­
ities may take action and the individual may recover threefold damages
sustained. See Acts Nos. 11 and 12, extra session 1916.
Mortgages can be foreclosed at any time after maturity of the
debt, by instituting a regular suit and obtaining judgment thereon, or
if the act imports a confession of judgment in favor of the holder, he
can apply to the court for an order directing the sheriff to seize and
sell the property. All mortgages must be recorded before they can
have any effect as against third parties. Trust deeds are not legal,
except as provided under “Trusts.” There is no redemption of prop­
erty sold under mortgage. All tacit mortgages have been abolished
since 1870. In making sales or giving a mortgage upon his property.
It is not necessary for the husband to obtain the signature of the wife,
except as affecting the homestead and family home. A mortgage

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BANKING AND COMMERCIAL LAWS—MAINE

resulting rrom recording a judgment cannot have that effect until
after adjournment of court. [Act 1888.) Lessee, sub-lessee or
assignee of lease or sub-lease may mortgage his interest in such lease
or sub-lease, together with his interest in buildings, etc., upon leased
premises: provided, such mortgage shall not affect, diminish or destroy
lessor’s privilege. Leases and contracts to explore for oil, gas and
minerals may be mortgaged. [Act 232 of 1910.1
Negotiable Instruments. “Negotiable Instrument Act” (No.
64 of 1904) changes in many respects the laws formerly applicable to
bills and notes. Under it, days of grace, which formerly were custom­
ary, are abolished. Instruments are payable to bearer if made payable
to the order of a fictitious or non-existing person, when such fact is
known to the one making it so payable; when name of payee does
not purport to be name of any person; or when the only or last indorse­
ment is in blank. When there is a discrepancy between the words
and the figures of an instrument, the sum denoted by the words is
the sum payable. Two or more persons signing instrument contain­
ing words, “I promise to pay,” are jointly and severally liable thereon.
Presentment for payment is unnecessary to bind party primarily
liable but is necessary to charge drawer or indorser. Notice of dis­
honor must be given to drawer and indorser when instrument has
been dishonored by non-acceptance or non-payment, otherwise they
are discharged. A bill of exchange does not operate an assignment
of funds in hands of drawee available for payment thereof, and drawee
Is not liable till he accepts same. Holder may require acceptance
to be written on bill, and if refused, may treat the bill as dishonored.
An acceptance written on paper other than a bill, and an uncondi­
tional written promise to accept a bill before it is drawn, binds the
acceptor only in favor of a purchaser for value on faith thereof.
Drawee has twenty-four hours to decide whether he will accept or
not. A drawee who destroys a bill presented to him for acceptance,
or who fails to return the bill within twenty-four hours, is deemed to
have accepted the same. Where a signature is so placed upon a
negotiable instrument that it is not clear in what capacity the person
making same intended to sign, he is deemed an indorser. Foreign
bills must be protested for non-acceptance or non-payment. Where
a bill does not appear on its face to be a foreign bill, protest thereof
In case of dishonor is unnecessary A check must be presented for
payment within a reasonable time or drawer will be discharged from
any loss caused by delay. Bank is not liable to holder of a check
until it accepts or certifies same. When the last day to do an act
required or permitted to be done under the act falls on a Sunday or
legal holiday, it may be done on the next succeeding secular or busi­
ness day. When day of maturity falls on a Sunday or a holiday, the
Instrument is payable on next succeeding business day. Instruments
falling due on Saturday are to be presented for payment on next
succeeding business day. except that instruments payable on demand
may. at option of holder, be presented for payment before 12 o’clock
noon on Saturday when that entire day is not a holiday. If the day
or days next succeeding the protest for non-acceptance or non-pay­
ment shall be days of puolic rest or legal holidays or legal half holi­
days. then the day next following shall be computed as the first day
after the protest. Service of citation shall not be waived, nor judg­
ment confessed, by anr document under private signature executed
rlor to the maturltv of the obligation sued on. Acceptance must
e In writing and signed by drawee. It must not express that drawee
will perform his promises by any other means than payment of money.
(Act 189 of 1908.1
Partnership, Limited and Special. Stipulations that one shall
participate in the profits and shall not contribute to losses is void,
both as regards partners and third persons. Partnerships are divided
as to their object into commercial and ordinary partnerships. Com­
mercial partnerships are such as are formed
1. For the purchase
of any personal property, and the sale thereof either in the same
state or changed by manufacture 2. For buying or selling any
personal property whatever, as factors or brokers. 3. For carrying
personal property for hire, in ships or other vessels. Ordinary part­
nerships are all such as are not commercial. There is also a species
of partnership which may be incorporated with either of the other
kinds, called partnership in commendam. It is formed by contract,
by which one person or partnership agrees to furnish another person
or partnership a certain amount, either in property or money, to be
employed by the person or partnership to whom it is furnished, in
his or their own name or firm, on condition of receiving a share in
the profits, in the proportion determined by the contract, and of being
liable to losses and expenses to the amount furnished and no more.
Partner in commendam cannot bind other partners by his act. Part­
nership in commendam must be made in writing , must express amount
furnished or agreed to be furnished; the proportion of profits which
partner is to receive and expenses and losses he is to bear . must state
whether it be received in goods or money, etc.; must be signed by
parties in presence of at least one witness and recorded in full within
six days in mortgage office. If branch houses are established the con­
tract must be recorded in parish where branches are located. If
partner in commendam allow his name to be used, or if he take any
part in the business of the partnership, he will be liable as a general
partner. Ordinary partners are not bound in solido for debts of
partnership, and no one of them can bind his partners unless they
have given him power to do so: each is bound for his share of the debt
in proportion to the number of partners. Commercial partners are
each liable for the entire debts of the partnership.
Powers of Attorney. May be written or oral. May be either
general for all affairs or special for one affair only. One conceived tn
general terms confers only power of administration ; to sell mortgage
or do any other act of ownership, the power must be express and
special.
Probate Law. There Is no special probate court. District courts
are vested with probate jurisdiction. Successions are opened upon
petition of interested persons in the parish where the deceased resided,
if he had a domicile or fixed place of residence in the state; in the parish
where he left his landed property if he had neither domicile nor
place of residence in the state: or in the parish in which It appears
from the inventory thax his principal property was situated, if he
left property in several parishes; in the parish where he died, if he
had no certain domicile nor any fixed property, ir presumptive heir
does not begin legal proceedings to settle succession within ten days
after death of “de cujus," creditors may demand that he state whether
he accept* or rejects succession, or if no heirs appear, that a curator
ad hoc be appointed to settle the estate The judge appoints an
administrator when deceased leaves no will. Administrators must
render annual accounts, and are allowed 2 >4 per cent on the inven­
tory as commissions. Attorneys at law are appointed to represent
absent heirs. Properties acquired during marriage are presumed to
be community property, and surviving spouse is owner of one-half.
When either husband or wife dies, leaving no ascendants or descend­
ants. and without having disposed by will of his or her share in the
community, such undisposed of share shall be inherited by the surviving
spouse in full ownership. (See Successions).
Protest. (See Negotiable Instruments.)
Separation from Bed and Board. May be claimed reciprocally
for: 1. Adultery. 2. When spouse condemned to infamous pun­
ishment. 3. Habitual Intemperance, excesses, cruel treatment, or
outrages, when such renders living together insupportable. 4. Public
defamation of one spouse by the other. 5. Abandonment. 6.
Attempt of one spouse against life of other. 7. When one spouse
charged with infamous offense actually fleee from justice. Divorce
may now be obtained if both parties have lived separate for seven
years.
Judgment of Divorce “a vinculo matrimonii" can be obtained
Immediately for first two causes. For other causes it Is necessary
first to obtain judgment of separation “a mensa et thoro.” After
judgment of separation from bed and board, if there has been no

reconciliation, party in whose favor judgment is rendered can obtain
final divorce one year after finality of judgment of separation. Party
against whom judgment is renuered must wait two years. When
marriage is celebrated outside of state parties cannot obtain divorce in
state on grounds occurring outside of state.
Taxes. Taxes on real estate cannot be enforced until the expira­
tion of the year for which they are levied and after legal notices to
delinquents and advertisement. Lands sold for taxes are redeemable
within one year, by the owner, his agent, or heirs, or any creditor,
on payment of the purchase money, with 20 per cent interest and
costs, and all subsequent taxes paid. Lands sold for taxes due prior
to 1880 are not redeemable. State taxes are 5 ]4. mills on actual value,
parish taxes not exceeding 4 mills. City of New Orleans taxes are
27J-3 mills on 85 per cent of actual value, other municipal taxes not
to exceed 7 mills. Delinquent state taxes bear interest at 2 per cent
a month, city taxes, 10 per cent a year.
Trusts. Act 107 of 1920 permits donations Inter vivos or mortis
causa to be made whereby individuals or State Bank and Trust com­
panies or banks organized under Federal laws may b»> made trustees
These trusts to last not longer than 10 years after death of donor
unless the cestui is a minor, at death of donor, in which case they may
last till 10 years after his majority. The legitime may thu*- be ad­
ministered in trust
Wills. There are four different kinds of wills, viz.: The olo­
graphic, nuncupative by public act, nuncupative by private act. and
mystic (or sealed) will. The olographic will must be wholly written,
dated and signed by the testator, and may be made within or with­
out the State. Nuncupative will by public act is written by a notary
in presence of three witnesses, over the age of 16 years complete,
not insane, deaf, dumb or blind, residing In the place where will
Is executed, or five witnesses not residents of the place, at the dictation
of the testator. Nuncupative will by private act and mystic wills
are subject to many formalities which may be best obtained by refer­
ence to Civil Code Arts, 1581-1587 both inclusive. All persons
of sound mind over sixteen years of age may dispose of their property
by will. Wills executed without the state given force and effect
provided same be in writing and subscribed by testator and follows
form of place where executed, or of testator’s domicile. (See act 176
of 1912.)

g


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Federal Reserve Bank of St. Louis

SYNOPSIS OF

THE LAWS OF MAINE
RELATING TO
BANKING AND COMMERCIAL USAGES
Revised by Pulsiper & Lcbden,

08 Maine St.. Lewiston, Me.
(See Card In Attorneys’ List.)

Acknowledgments. (See Deeds.)
Actions. At law begun by writ, under common law practice, bu*
containing declaration. Suits In equity are begun by bill of comIaint. filed with clerk of court and subpoena issued by him, or may
e inserted in writ of attachment and served by copy of bill and writ.
On motion non-resident plaintiffs required to give security for costs.
An affidavit in actions brought on an itemized account, made before
a Notary Public having a seal makes a prima facie case, if without the
State authority of Notary must be certified by clerk of court of record.
Administration of Estate. (See Estates of Deceased Persons.)
Affidavits. Affidavits may be made before a notary public or
justice of the peace. In some court matters authority of magistrate
must be proved by certificate of clerk of a court of record.
Aliens. Aliens may hold and convey real estate and personal
property. Wills of aliens may be proved and allowed in this State.
Widow of a citizen of United States who was an alien when she married
him has right of descent in his estate (but see Married Women).
Arbitration. Judge of probate court may authorize executors or
administrators to adjust by arbitration claims for or against the
estates represented by them. All controversies which may be the
subject of personal action may be submitted, by the parties, to referees
for arbitration
Majority of referees may make report to Supreme
or Superior Courts.
Arrest. (See Executions.) In actions ex delicto, on mesne proc­
ess and execution, as of course without affidavit or order; in actions
ex contractu, on mesne process, upon affidavit of the creditor, his
agent, or attorney, that he has reason to believe and does believe
that the debtor is about to depart and reside beyond the limits of
the State and carry with him means of his own more than are neces­
sary for his immediate support, and that at least #10 is due on the
claim; on execution, only after supplementary proceedings and fraud
proven, but if contract judgment or action existing March 17, 1887,
arrest on execution. Debtors arrested on mesne process or execution
mav disclose give up property not exempt from attachment and be
discharged from arrest, or may give a six months bond and disclose
according to its terms. No arrest in actions ex contractu for less than
#10. and none of married women In civil actions.
Assignments. Common law assignments for the benefit of
creditors may be made, and after four months will be good against
bankruptcy proceedings. Assignments of wages must be recorded
in town clerk’s office in town where assignor is employed. Invalid
unless employer has notice.
Attachment. All property not exempt attachable on mesne proc­
ess as of course without affidavit; security for costs by indorser of
writ only if creditor is non-resident; lien by attachments in the order
In which they are made continue for thirty days after judgment
(extended where execution is delayed, appeal from taxation of costs
Is taken, or decision of law court certified down in vacation), within
which time levy may be made. Personal property may be appraised
and sold on mesne process to avoid expense, depreciation or loss,
on request of either party and proceeds held by officer in lieu of the
property, foreign attachment (garnishment), known as trustee process,
attaches property by or debt due from trustee unless: 1. Due on
negotiable paper. 2. Money collected on process by officer. 3.
In hands of public officer. 4. Due on contingency. 5. Trustee
liable to execution on same. 6. Twenty dollars wages, for personal
labor of the debtor, wife or minor child within one month, and $10
exempt in all cases. 7. In certain cases money due on life and
accident policies, and from fraternal beneficiary associations. (See
Creditors1^ Bills.)

§

BANKING AND COMMERCIAL LAWS—MAINE
Banks. Savings bank business and discount banking permitted
only under special charter, and under state supervision. Trust com­
panies may be organized under general statutes on obtaining approval
of state bank examiner. General statutes relating to discount bank­
ing repealed by Laws 1903, c. 166. Foreign banking associations hav­
ing a branch here pay a tax of three-fourths of one per cent per annum
on the amount of business done in this State. Savings banks have
no capital, and do business only for the benefit of depositors, under
statute regulations restricting investments, requiring reports under
oath and examinations by bank examiner. Must not pay over 2 1-2
per cent dividend semi-annually. Franchise tax is one-half per
cent, regulated to favor home investments. Use of the words “ bank,"
“trust company, ana similar words in designating a business, for­
bidden, except by corporations organized as above or under laws of
United States. Corporations, if licensed by bank commissioner may
receive savings deposits from their employees. Dealers in securities
must be registered with bank commissioner and are subject to certain
regulations.
Collaterals. (See Mortgages.)
Conditional Sales, Consignments. No agreement that personal
property bargained and delivered to another shall remain the property
of the seller until paid for, Is valid unless in writing and signed by the
person to be bound. Such agreement in whatever form it may be,
Is not valid except as between original parties, unless recorded in the
office of the clerk or the town in which the purchaser resides at the
time of the purchase Alls uch property whether said agreements
are recorded, or not shall be subject to redemption. This does not
apply to goods consigned for sale.
Conveyances. (See Deeds.)
Corporations. Three or more persons may rorm a corporation to
carry on any lawful business excepting banking, insurance, construct­
ing and operating railroads, savings banks, trust companies, or cor­
porations intended to derive profits from the loan or use of money,
and safe deposit companies, but corporations may be formed under
the general law for the construction and operation of railroads ourside
the State of Maine. Corporations for other purposes, excepting for
municipal purposes, and where the objects of the corporation can not
be attained without special acts, are also formed under general laws.
Organization becomes void unless corporation begins business within
two years. Corporation may capitalize to an unlimited amount and
may increase or decrease the amount of their capital or the par value
of the shares. No portion of capital Is required to be paid in; stock
may be issued for property or for services and in absence of fraud
the Judgment of the directors as to the value of such property or
services is conclusive, the stock thereupon becoming fully paid.
Only original subscribers and takers of stock are liable on same to
extent of unpaid par value and then only for debts contracted during
their ownership of stock, and action to enforce such liability must be
commenced within two years and can be maintained only by a judg­
ment creditor of the corporation who shall have begun proceedings
to obtain such judgment against the corporation during the owner­
ship of such stock or within one year after its transfer by such stock­
holder is recorded on the corporation books. Directors must be
stockholders or members of another corporation which is a stockholder
If corporation fails for six months to elect directors, court may appoint.
Corporations must pay to the State upon organization, a fee as fol­
lows: Where the capital stock is $10,000 or less, $10; exceeding
$10,000 and up through $600,000, $50; above $500,000, $10 for every
$100,000 of capital. Other fees for organization are: attorneygeneral’s fee $5; register of deeds $5, secretary of state $5. The
annual franchise tax is as follows: $5 provided authorized capital
does not exceed $50,000; exceeding $50,000 and up to $200,000.
$10; exceeding $200,000 and up to $500,000, $50; exceeding
$500,000 and up to $1,000,000, $75; and the further sum of
$50 per $1,000,000 or any part thereof in excess of $1,000,000. Cor­
porations which have suspended business temporarily and have been
excused from filing returns of amount of capital stock, etc., are not
liable for franchise tax. Meetings of stockholders must be held within
the State, Clerk must be resident and keep stockholders’ records In
the State. His records are open to inspection by stockholders but
not by mere creditors. With the exception of banking corporations
no public reports are required except one to the secretary of state
showing names and residences of officers and amount of capital stock.
Delivery of certificate of stock to bona fide purchaser or pledgee for
value together with written transfer of same or written power of
attorney to sell, assign, and transfer same, signed by owner of cer­
tificate. transfers title against all parties. Foreign corporations have
practically same rights as domestic, but are required to file copy of
charter with secretary of state, also a copy of the by-laws, and are
also required under severe penalties to file certificate showing among
other things the names of officers, amount of capital stock authorized,
amount issued and amount paid in; also must file certificate showing
any change in above particulars. Such corporations must also appoint
a resident of Maine, having an office or a place of business in the
state, to be its attorney on whom process may be served in any legal
proceeding. Corporations may dispose of their franchises on majority
vote of the stockholders; may sue and be sued, and have generally
the powers of individuals. Public service corporations are subject
to a Public Utilities Commission.
Courts. Terms and civil jurisdiction. Supreme Judicial Court,
eight terms a year. Appellate jurisdiction, en banc on questions of
law from trial terms of Superior Courts. Superior Court, unlimited
jurisdiction, except as specified below. Full jurisdiction in equity.
Creditors’ Bills. Bill in equity may be maintained to reach
property of debtor which cannot be reached by process at law, and
Is not exempt from attachment; also property conveyed In fraud of
creditors and property secreted so that it is not replev table.
Days of Grace. (See Negotiable Instruments.)
Deeds. Any owner of real estate having right of entry may con­
vey it by deed. No estate greater than tenancy-at-will can be created
except in writing. Deeds must be acknowledged by a grantor or
one of them or by an authorized agent, executing the same, before
a justice of the peace, notary public having a seal, or woman qualified
to take acknowledgments; outside the State, and in the United States,,
before a clerk of a court of record having a seal, notary public; or
commissioner of deeds for this State, and in a foreign country before
a notary public, or a consul or minister of the United States, but If
magistrate acting outside of State has no official seal, his authority and
the genuineness of bis signature must be authenticated by the secre­
tary of state or the clerk of a court of record in county where he resides.
Unacknowledged deeds cannot be recorded. No special form of
acknowledgment required. Deeds must be recorded to be valid
against parties without notice of the conveyance. Deeds must be
under seal, but witness is not required for validity although usual
to have one. Leases for more than seven years must be recorded.
Trusts concerning real estate can be created only in writing, except
those arising by implication of law.
Depositions. Depositions may be taken by disinterested justice
of the peace or notary public; may be taken when deponent is unable
through age, infirmity, or sickness to attend at place of trial; when
deponent resides out of, or is absent from the State: when deponent
resides in town other than that in which trial is to be held, etc. Depo­
sitions so taken may be used in all civil suits or causes, petitions for
partition of land, libels for divorce, prosecutions for the maintenance
of children, petitions for opinions in trial before courts of arbitrators,
referees and county commissioners, and in cases of contested senatorial
or representative elections. Depositions or affidavits may also be
taken In applications for pensions, bounty, or arrears of pay under
any law of the United States. Courts may issue commissions to
take depositions out of the State, or they may be taken out of State
by a Justice, notary, or other person empowered, but in the latter
case it is within the discretion of the courts to admit or reject them.


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Federal Reserve Bank of St. Louis

2183

Descent and Distribution of Property. (See Estates of De­
ceased Persons.)
Dower. Abolished by laws of 1895, chap. 157, taking effect as
to persons not then married, May 1, 1895; as to others, Jan. 1, 1897.
Wife or husband may bar the right by inheritance to one-third or
one-half, as the case may be, of realty by joining in the other’s deed,
or by sole deed, or by ante-nuptial settlement, or by jointure. Either
refusing to join in other's conveyance (or if incapacitated with no
guardian in this state, other being a non-resident) may be barred of
Inheritance upon application to supreme judicial court and decree
after hearing. (See Estates of Deceased Persons.)
Estates of Deceased Persons. One year after notice of apointment allowed creditors to present claims and suit must be
egun and service of process made within twenty months after such
notice of appointment. Allowance to widow and minor children,
made by court from estate. Non-resident executor or administrator
must appoint attorney. Time of demand or notice extended for absent
creditor if further assets, but prior payments not disturbed thereby.
No administration granted after twenty years. The real and personal
estate of a person deceased intestate (excepting wild lands conveyed by
him) being subject to the payment of debts descends according to the
following rules: 1. If he leaves a widow and issue, one-third to
the widow. If no Issue, one-half to the widow. And if no kindred,
the whole to the widow. And to the widower shall descend the same
shares in his wife’s real and personal estate. There shall likewise
descend to the widow, or widower, the same share in all such real
estate of which the deceased was seized during coverture and which
has not been barred, or released, as herein provided. In any event,
one-third shall descend to the widow or widower free from the pay­
ments of debts. 2. The remainder of which he dies seized, and If
no widower, or widow, the whole, together with all wild lands shall
descend in equal shares to his children, and to the lawrul issue of a
deceased child by right of representation. If no child is living at
the time of his death, to all his lineal descendants; equally. If all are
the same degree of kindred; if not. according to the right of repre­
sentation. 3. If no such issue, it descends to his father and mother
In equal shares. 4. If no such issue, or father, it descends one-half
to his mother. If no such Issue or mother, it descends one-half to
his father. In either case, the remainder, or if no such issue, father
or mother, the whole descends in equal shares to his brothers and
sisters, and when a brother or sister has died, to his or her children
or grandchildren by right or representation. 5. If no such issue,
father, brother or sister. It descends to his mother. If no such issue,
mother, brother or sister, it descends to his father. In either case,
to the exclusion of the issue of deceased brothers and sisters. 6. If
no such issue, father, mother, brother or sister, It descends to his next
of kin in equal degree; when they claim through different ancestors,
to those claiming through a nearer ancestor, in preference to those
claiming through an ancestor more remote. 7. When a minor dies
unmarried, leaving property inherited from either of his parents, It
descends to the other children of the same parent, and the issue of
those deceased; in equal shares if all are of the same degree of kindred;
otherwise, according to the right of representation. 8. If the
intestate leaves no widower, widow or kindred, it escheats to the
State. An illegitimate child is an heir of its parents who intermarry;
also of its mother, also of its father, who adopts it or acknowledges
It before a magistrate; and in any case where the child is treated as
an heir it inherits from the lineal and collateral kindred of the parent,
and they from it. (See Wills.)
Executions issue after twenty-four hours from rendition of judg­
ment. returnable in three months, renewable within ten years after
No stay except by order of court for cause and one year against absent
defendants unless bond filed; levied on real estate by appraisal and
extent, also on real estate and interests in the same and franchises
and personal property by sale; money and, by consent, circulating
notes applied directly. Real estate sold on execution may be re­
deemed In one year. Attaching creditor may within forty-eight
hours after notice redeem personal property of debtor which is subject
to mortgage pledge, or lien; may also redeem real estate subject to
mortgage or other lien. Special provisions for redemption or certain
other special classes of property, such as buildings on leased lands,
franchises, etc.
Exemptions from Attachment and Execution. Homesteads,
not exceeding in value $500, when duly registered; debtor’s apparel,
necessary furniture for family, not exceeding in value $100; bed and
bedding for each two persons; family portraits, bibles, school books
In use; State statutes; library. $150; regular pew; cook stove and
Iron warming stoves; charcoal, twelve cords or wood, five tons an­
thracite coal, fifty bushels bituminous coal, $10 worth of lumber
wood, or bark; produce of farms till harvested; barrel of flour, thirty
bushels of corn and grain, potatoes for family, one-half acre of flax
and manufactures therefrom for family; tools of trade, and materials
and stock. $50; sewing machine, $100; pair working cattle, or pair
mules, or one or two horses, $300; hay to keep them; harness for
each horse and mules, $20; horse sled or ox sled, $20: domestic fowl,
$60; two swine, one cow and one heifer, if no oxen, horse or mule,
two cows; ten sheep, their wool, their lambs until one year old; hay
to keep them and cattle; plow, cart, truck or express wagon, harrow,
yoke with bows, ring and staple, two chains, mowing machine; fish­
ing boat of two tons; debtor may elect if he has more than is exempt.
Life and accident policies are exempt from creditors, except any
excess of $150 per year premium paid within two years, except suits
for necessaries. (See Attachment.)
Foreign Judgment. Action of debt lies on a foreign Judgment
and record of it is prima facie evidence of indebtedness. Is conclusive
except for fraud when given by court having jurisdiction of parties
and subject matter.
Fraud. Usual common law rules as to what constitutes fraud,
fraudulent representations, etc.; also statutory penalties for fraud,
cheats, etc. Court of equity has power to afford relief. Statutory
provisions to prevent sale In bulk of part or whole of stock of mer­
chandise in fraud of creditors.
Frauds and Perjuries. No action shall be maintained upon any
contract to charge an executor or administrator upon any special
promise te answer damages out of his own state: nor to charge
any person upon any special promise to answer for the debt, default,
or misdoings of another; nor to charge any person upon an agree­
ment made in consideration of marriage nor to charge any person
upon any contract for the sale of lands, tenements, or hereditaments,
or of any interest therein; nor to charge any person upon any agree­
ment that is not to be performed within one year from the making
thereof; nor to charge any person upon any contract to pay a debt
after discharge therefrom under bankrupt laws of the United States
or assignment or insolvent laws of this State; unless the promise,
contract, or agreement or some memorandum thereof is In writing
and signed by the party to be charged, or his agent. No action shall
be maintained on a minor s contract unless ratified by him In writing
after becoming twenty-one years of age, except the contract be for
necessaries or real estate where he has received title and obtained
benefit. No contract for sale of goods, etc., of $30 or more in value
Is valid unless purchaser accepts or receives a portion of the goods
or gives something to bind the bargain, or in part payment thereof,
or some memorandum Is made and signed by party charged or his
agent. Contracts whereby one becomes agent for sale of lands become
void in one year unless time for termination definitely stated.
Garnishment. (See Attachment.)
Holidays. January 1st, February 22nd, April 19th, May 30th,
July 4th. first Monday of September Columbus Day. October 12th,
Armistice Day, November 11th, December 25th, and days of public
fast or thanksgiving and Arbor Day appointed by the Governor
and Council.

2184

BANKING AND COMMERCIAL LAWS—MARYLAND

Husband and Wife. Each may hold and deal with property
individually, subject to right of descent in real estate. (See Estates
of Deceased Persons.) Husband not liable for debts of wife con­
tracted before marriage, nor afterward in her own name, nor for her
torts. Equity Court has special jurisdiction of disputes between
husband and wife relating to property. After petition to and decree
by probate court either may convey real property as if sole, and other
Is barred of all right by descent where deserted without just cause
or if actually living apart for just cause, and desertion or living apart
has continued one year.
Interest. Six per cent or any other rate agreed upon in writing;
judgments, same rate; accounts and debts not on time bear interest
from demand. Special rate in time notes does not continue after
maturity, unless so provided; nor after judgment in any case; no usury
laws. On loans for less than $300 secured by mortgage or pledge
of personal property, the rate shall not exceed 3 H per cent per month.
Loans negotiated in this state by agent of non-resident borrower with
Intent to evade usury laws of state where borrower resides are voida­
ble.
Judgments. At law; by general order at end of term on all cases
where verdict or default, unless stayed by proceedings for new trial,
or continued for judgment by plaintiff; In equity, only by decree
signed by justice. No lien except by virtue of attachment on mesne
process (q. v.) and where specially provided by law.
Liens. (Voluminous Statute Provisions, for Mechanics, Material
Men. Hotel and Boarding-House Keepers, Stable Keepers. Agister,
etc.).
Limitation of Actions. Six years; debt on unsealed contract or
liability (except judgments); actions upon judgments out of State of
court not of record; for arrears of rent; of account, assumpsit, or
case on contract or liability express or implied; waste; trespass qu.
cl. and d. b. a.; replevin; case, except slander and libel. Pour years;
against sheriff. Two years: assault and battery, false Imprisonment,
slander libel and penalty. One year: escape, scire facias and on
recognizance. Eighteen months; stolen bonds and coupons, except
by owner. Twenty years- witnessed notes, bank bills, specialties,
real action, other judgment and all other personal actions. Suit
begun when writ was made. Incapacity of plaintiff, death of either
party before or within thirty days after expiration of time, fraudu­
lent concealment of action, absence from State when cause accrues
or residence out of the State and absence afterwards, extends time.
Actions barred where both parties lived are barred here. New
promise must be in writing or part payment must be made, to extend
time. Against executors and administrators, twenty months after
filing of affidavit of notice given of appointment of executor or admin­
istrator, unless further assets or claim not matured. Against heirs
or devisees, one year after claim accrued, remedy in equity, if not
prosecuted within time limited and If without, culpable neglect.
Limited Partnership. May consist of one or more general part­
ners and one or more special. Special shall contribute specific amount
of capita] or property at cash value, and be not liable for debts beyond
that amount. General partners must transact the business.
Married Women have same rights and liabilities as to propei-v*
contracts and all suits as men. Wife’s property not liable for her
husband’s debts, nor his liable for her prior debts, nor for others made
on her credit. She may sue and be sued as if sole. May not be
partner of husband and not liable for family expense except by express
promise. (See Arrest, also Dower, also Estates of Deceased Persons,
also Husband and Wife.)
Mortgages. Of real estate executed and acknowledged as deeds
and must be recorded as to third parties; convey fee with condition
of defeasance. Foreclosed without possession by serving or adver­
tising notice, or by possession obtained peaceably, or by consent, or
by suit. Redemption in one year from notice or possession; power
of sale mortgages not authorized by statute and not much used.
Supreme or Probate courts may authorize a mortgage by a person in
possession of an estate subject to a contingent remainder, executory
devise, or power of appointment, and such mortgage is binding on all
parties. Chattel mortgages unless and until possession taken and
retained by mortgagee to be good against third parties must be
recorded in town clerk's office where mortgagor resides when mortgage
■ given; or, if any of mortgagees are nonresidents, then in registry
lof deeds in county where mortgagee resides, when mortgage is given.
Mortgage on household furniture must state amount of loan, interest
rate, and cost of procuring loan. Agreements, whether in form of
note, lease, conditional sale, etc., or otherwise, that chattels bargained
and delivered shall remain property of seller till paid for, must be in
writing and recorded as chattel mortgages; such mortgages and notes
foreclosed by sixty days’ notice to mortgagor or assignee of record,
or, if out of State, by publication; redemption in sixty days. Col­
laterals pledged on notes, etc., or for the performance of anything,
after failure to pay or perform by the pledgor, may be sold by the
pledgee, he first giving written notice to the pledgor of the proposed
sale, or if his residence is unknown, by publication of notice once a
week for three successive weeks in a newspaper In the city or town
where the pledgee resides, recording said notice and affidavit of service
of same in the clerk’s office of city or town where the pledgee resides,
and after the expiration of the sixty days from the time of said record­
ing.
Negotiable Instruments. Days of grace abolished except as to
sight drafts. Falling due on Sunday or bank holiday payable and
resentable for payment on secular or business day next succeeding.
t holiday falls on Sunday then following Monday is deemed bank
holiday. On notes payable at fixed place on demand at or after a
time certain, no recovery unless demand proved there before suits
usual demand and notice to charge indorser: notarial protest proves
it; Waiver of demand and notice, acceptance of bill, draft, or order must
be in writing and signed. Recovery from indorser without suing
maker. Rate of damages on protested bills of 100 or more payable
In this country, 1 to 9 per cent according to place. Negotiable paper
presumed to be taken In payment of debt or liability for which it is
given, unless creditor would thus lose security he otherwise would
have had. Legal holidays are January 1; February 22; April 19;
May 30; July 4; first Monday in September; Thanksgiving; Christmas,
and Arbor Day. If note reads "I promise to pay” all signers are
jointly and severally liable.
Partnersblp. Personal property of partnership, or Interest of
partner therein, exempt from attachment on mesne process, or seizure
on execution for any individual liability or such partner; but Is statu­
tory provision for reaching same after judgment. Partners in mercan­
tile enterprise must file sworn certificate with city or town clerk
where business to be carried on. showing names and residences of
partners, nature of business and partnership name. (See Limited
Partnership.)
Powers of Attorney. Usual common law rules.
Probate Law. (See Estates of Deceased Persons.)
Protest. (See Negotiable Instruments.)
Replevin. Goods or chattels wrongfully taken or detained may
be replevied by owner or party entitled to possession. Replevin bond
must be double the value of property replevied. If dismissed with­
out trial, suit may be brought on the bond, in which suit title may be
shown to mitigate damages.
Taxes may be collected by arrest, distress, or suit. On real estate
they are a lien; proceedings to enforce by sale begin upon non-pay­
ment for nine months; non-resident owners have one year from sale
to redeem by paying tax. costs, and 10 per cent Interest from day of
sale; residents, two years with 10 per cent interest from day of sale
on whole sum of tax and costs. Land on which taxes are unpaid,
sold on first Monday in February in year succeeding the year in which
tax was assessed; sale is of smallest fractional part of interest to one

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who will pay taxes, interest, and costs therefor. State tax assessed
by board of state assessors on gross receipts of railroads and express
companies, and telegraph and telephone lines, collected by suit.
Corporations, other than those especially provided for, pay a franchise
tax of $5.00 if authorized capital does not exceed $50,000.00; of
$10.00 if capital does not exceed $200,000.00; of $50.00, if capital
does not exceed $500,000.00; of $75.00, if capital does not exceed
$1,000,000.00; and the further sum of $50.00 for each $1,000,000.00.
or fraction thereof, in excess of $1,000,000.00. Foreign corporations
pay annual license fee of $10. Inheritance tax ranging from 1 to 7
per cent, according to degree of relationship and amount of bequest.
$500 exempt in all cases, and $10,000 exempt in case of certain near
relatives. Special exceptions and exemptions from assessment, and
special provisions for taxing personal property situated here but
owned out of the State. Real estate mortgages exempt. (See
Banks.)
Wages. Weekly payment required In most Industries. (See
Assignments, Attachment.)
Warehouse Receipts. Holder deemed true owner so far as to
give validity to contract for sale of merchandise covered, or to protect
one acting on faith of such ownership; but one taking from agent as
security for antecedent debt gets no greater right than agent. Title
to property passed by endorsement, but not in blank, to purchaser
or pledgee in good faith. Property in warehouse may be attached
as that of person named in receipt, or of last endorsee shown by books
warehouseman. Common law rules prevail generally.
Wills. Wills must be in writing signed by the testator, or at his
request by some person in nis presence, and subscribed in his presence
by three witnesses not beneficially interested, in presence of each other,
may be made by any person of age and of sound mind, and may dispose
of all property. Wills executed in another 8tate or country according
to laws thereof, may be proved and allowed in this State in the county
where the testator had his residence at time of decease; if proved
without this State (at his domicile), may be allowed in any county
here where he has property. Widow or widower may within six
months waive provision in will of deceased husband or wife and claim
tame share in property as would have had in case deceased died
Intestate. (But see Husband and Wife.)
Nuncupative will must be reduced to writing within six days, or
proved by testimony within six months, from time words spoken.
No letters in such till fourteen days after decease of testator. Not
effectual to dispose of more than $100.00 worth of property unless
proved by three witnesses who acted at testator's request.

SYNOPSIS OF

THE LAWS OF MARYLAND
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Blades, Rosenpeld and Frederick, Attorneys at Law,
1206-1207 Fidelity Building, Baltimore.
(See Card in Attorneys’ List.)
In general. Bagby’s Annotated Code (1924-two volumes) and
Supplementary Volume (1929) and the Acts of 1931 which are not
yet codified, embrace the Public General Laws of Maryland. By
statutes, both the Code of 1924 and the 1929 Supplement have been
legalized and made evidence of the law; especial reference to statutes
in the following is therefore unnecessary.
Acknowledgments may be taken within the United States before
any Notary Public and are sufficient if attested merely by the signa­
ture and notarial seal of the Notary. No estate of inheritance or
freehold, or any declaration or limitation of use, or any estate in
land above seven years, shall pass or take effect unless the deed con­
veying the same shall be executed, acknowledged by all grantors and
recorded, and no deed of real or leasehold property shall be valid for
the purpose of passing title unless acknowledged by all grantors and
recorded. Such deeds may be acknowledged by the grantor or
grantors wherever they may happen to be at the time of execution
of the instrument. If acknowledged in the county or city withiD
which the land or any part of it lies, the acknowledgment may be
made before a notary public, a justice of the peace for such city or
county, a judge of the Orphans’ Court of such city or county, a judge
of the Circuit Court for the county, or (if the land lies wholly or partly
in Baltimore City and the acknowledgment is there made) before a
judge of the Supreme Bench of Baltimore City. If acknowledged
within the State, but out of the county or city wherein the real estate
or any part of it lies, the acknowledgment may be made before a
notary public, any judge of the Circuit Court for the circuit in which
the grantor may be, or any judge of the Orphans’ Court of the county
in which the grantor may be, any judge of the Supreme Bench of
Baltimore City, any judge of the Orphans’ Court of said city, or
before any justice of the peace for the county or city where the grantor
may be at the time of the acknowledgment, the official character of
such justice being certified to by the clerk of the Circuit Court for the
county or of the Superior Court of Baltimore City (as the case may
be) under the clerk’s official seal. If acknowledged without this
State, but within the United States, the acknowledgment may be
made before a Notary Public, a judge of any Court of the United
States, a judge of any court of any State or territory having a seal,
or before a commissioner of deeds for this State. If acknowledged
without the United States acknowledgment shall be made before an
ambassador, minister, envoy or charge d’affaires of the United States,
in the country to which he is accredited or before any one of the follow­
ing officers commissioned or accredited to act at the place where the
acknowledgment is taken, and having an official seal, viz.: any con­
sular officer of the United States; a notary public; or a commissioner
or other agent of the State of Maryland having power to take acknowl­
edgments to deeds. In all cases, the official seal of the officer or Court
taking the same must be affixed to the certificate of acknowledgment.
There are no special provisions as to acknowledgments by married
women. Corporations acknowledge either by attorney appointed for
that purpose in the body of the instrument itself, or by the President
or Vice-president of the Corporation, without such appointment.
All conveyances acknowledged prior to June 1st, 1931, in which such
acknowledgment is defective are validated by chapter 312 of the
Acts of 1931.
(See Conveyances.)
Actions. The forms of actions, which still savor of the common
law, are now very simple, any plain statement of facts constituting
a good cause of action being sufficient. Amendment is allowed at
any time before verdict. Equitable defenses are now allowed to be
made in a court of law. although there are still law courts and equity
courts having different and distinct jurisdiction.

BANKING AND COMMERCIAL LAWS—MARYLAND
Administration of Estates. The Orphans’ Courts of the Counties
and the Orphans’ Court of Baltimore City are the courts of probate.
Where decedent leaves a will, letters testamentary are committed te
the executor or executors (male or female)named in the will, if any are
named. Letters testamentary or of administration will not be granted
to any person under the age of eighteen years or of unsound mind, or
convicted of any infamous crime nor to any person not a citizen of the
United States. A non-resident of Maryland may be appointed as the
personal representative of a decedent resident of Maryland only when
the State of his or her residence extends reciprocal privileges to resi­
dents of Maryland. (Code, Art. 93, Sec. 41A.) In granting letters of
administration where decedent dies without leaving a will, or leaving a
will, does not name an executor or executors, certain persons are pre­
ferred to others. The order of preference follows: 1. Surviving
spouse, or child, or children (in discretion of the Court); 2. Grandchild
3. Father; 4. Mother; 5. Brothers and Sisters; 6. Next of kin.
Where one of a class of persons is entitled the appointment is in the
discretion of the Court. Males are preferred to females in equal degree
or kin; and relations of the whole-blood are preferred to those of the halfblood in equal degree, and relations of the half-blood are preferred to
those of the whole-blood in a remoter degree. A single woman is pre­
ferred to a married woman in equal degree. 7. If there be no relations
who qualify, letters of administration shall be granted to the largest
creditor applying for the same. 8. If there shall be none of the first five
groups above named, or if these be incapable or refuse to act, and if the
sixth and seventh groups neglect to apply, the appointment is in the
discretion of the Court. Bond is required with two sureties, or one of
certain surety corporations authorized by the law of Maryland to
qualify upon such bonds. When testator requests in will that exec­
utor therein appointed be excused from giving bond, then bond shall
be given only in such amount as the court shall consider sufficient to
secure payment of debts of deceased. Six months' notice to creditors
must be given by publication in as many newspapers as the Orphans’
Court shall direct (usually one) before the estate is distributed. _ Per­
sonal property of the decedent must be appraised, an itemized inven­
tory thereof filed in the Orphans’ Court, and distribution thereof
made through the Orphans' Court of the County or of Baltimore
City wherein decedent resided. All sales made by the personal
representative must be authorized and ratified by the Orphans' Court
which appointed him. The personal representative must within
twelve months of his appointment file in the Orphans’ Court of his
appointment a detailed account of his administration, and if such
first account does not show the estate to be fully administered, fur­
ther accounts must be filed at six month intervals until the estate is
fully administered. Above provisions also applicable to “estates of
persons absent and unheard of for above seven years” who after due
proof are declared by the Orphans' Court to be “judicially dead”
and letters testamentary or of administration are granted on such
estate as if the absent person were actually dead. The rights of such
absent person are protected by requiring the legatees or distributees
to give bond conditioned to repay sums received by them with
Interest, if such absent person should be in fact alive at the time
distribution is made.
Affidavits. (See Acknowledgments.) No particular form neces­
sary. but whoever can take an acknowledgment can take an affidavit
Affidavit of mortgagee always required in a mortgage as to the bonafldes of mortgage consideration. (See Mortgages.)
Aliens. Aliens, not enemies, may take and hold lands, tenements,
and hereditaments acquired by purchase, or to which they would, if
citizens, be entitled by descent; and may sell, devise, or dispose of
the same, or transmit the same to their heirs, as fully and effectually
and in the same manner as. if by birth, they were citizens of this State.
Arbitration. Any cause in the law courts or Orphans' Courts
of this State (in their respective spheres) may, by rule of court and
by consent and agreement of the parties thereto, be submitted and
referred to the award and arbitrament of any person or persons, and
the Court may give judgment on the award of the person or persons
to whom such submission and reference shall be made as of the term
to which said award shall be returned and award execution thereon as
upon verdict, confession or non-suit. By agreement, disputes bet ween
employer and employee may be submitted, for arbitration, to any
judge or justice of the peace, or if the parties so elect, to a group of
arbitrators appointed by such judge or justice of the peace, the deter­
mination of such judge, justice of the peace or of the arbitrators
appointed by them to be filed as a judgment of the court presided over
by the judge or justice of the peace to whom the dispute was sub­
mitted for arbitration. An agreement to arbitrate as distinguished
from a case actually submitted for arbitration cannot be specifically
enforced.
Arrest. No arrest for debts in this State. Where a fine is imposed
in Criminal Cases, however, if the prisoner does not pay the same, he
may be imprisoned, the length of imprisonment to depend on the
amount of the fine, but in no case to exceed six months.
Attachments for debt or for liquidated damages can be obtained
In all cases when the defendant is a non-resident or has absconded,
affidavit being first made by the plaintiff to the correctness of his claim
and the fact that the defendant is a non-resident or has absconded.
They may be also obtained in connection with an original process when
the creditor or some one in his behalf shall give bond in double the
amount of the debt, with sureties to be approved by the clerk, and
make affidavit before the clerk of the Court where the suit is brought
that the defendant is bona fide indebted to the plaintiff in the sum
claimed, and that the plaintiff knows or has good reason to believe that
the debtor has absconded or is about to abscond from the State, or
that the defendant has assigned, disposed of, or concealed, or is about
to assign, dispose of, or conceal, his property, or some portion thereof,
with intent to defraud his creditors, or that the defendant fraudu­
lently contracted the debt or incurred the obligation; or that the
defendant has removed or is about to remove his property, or some
portion thereof, out of this State, with intent to defraud creditors
and the attachment may be maintained, although the debt or obliga­
tion upon which the action is brought may not have matured, but the
date of the maturity of the debt or obligation must be set forth in
the affidavit. A claimant may have the attached property released
by filing a bond in double the amount of the appraisement. Any
kind of property or credits belonging to the defendant, in the plaintiff’s
own hands or in the hands of any one else may be attached. There
Is a special provision for capital stock of a corporation. The certifi­
cate itself must be seized. Credits not due may be attached, but
wages, hire or salary not due cannot be attached, and $100 of wages,
hire, or salary due shall always be exempt. Imprisonment for debt
is abolished. Defendant may be sued in the city or county of his
residence or that of his place of business. In addition to attachments
against non-residents or absconding debtors for debt (i. e., a liqui­
dated sum), as heretofore, attachments may now be issued against
such debtors in cases arising from contracts when the damages are
unliquidated, and in actions for wrongs independent of contract,
but in such cases no attachments can be issued until a declaration
is filed setting out specially and in detail the breach of the contract
complained of or the tort actually committed, verified by the affi­
davit of the plaintiff or some one in his behalf, and until a bond shall
be filed similar to the bond required in attachments for fraud. (Code
Art. 9.) All papers in attachment proceedings can now be amended
as in any other actions of law. If neither the Defendant nor Gar­
nishee appear condemnation may be had upon filing bond to be in
force for period of six months, accounting from the return of the
attachment.
Bank Collection Code. Follows directly after Laws.
Banks. The banking laws of Maryland provide for the appoint­
ment of a Bank Commissioner with broad powers for the examination
of all banking institutions in this State other than National Banks,
and an annual report thereon to the Governor. Whenever capital is
reduced by impairment commissioner may require Bank to make such


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2185

deficiency good within sixty days, and upon failure to do so may take
possession of property and business of such institution and retain
possession until affairs are finally liquidated. This also applies where
the business is conducted in an unsafe or unauthorized manner. The
requirements for the incorporation of such institutions are fully set
forth in the act. This act also provides for the incorporation and
supervision by the State of saving institutions and trust companies.
Every banking and trust institution shall have the right of perpetual
succession until forfeiture. (Chapter 188, Acts of 1927.)
Every bank and trust company shall make to the Bank Commis­
sioner not less than three reports during the calendar year, at such
times as the Bank Commissioner shall require. At least once a year
the bank or trust company shall report to the Bank Commissioner,
on call by him, a list of its stockholders.
The Bank Commissioner shall have a right to call for special reports,
whenever in his judgment the same is necessary. (Chapter 373,
Acts of 1927.)
Blue Sky Law. No preliminary reports or qualifications are
required and only if it shall appear to the Attorney General of Mary­
land that in the issuance, sale, promotion, negotiation, advertisement
of securities within the State of Maryland, any person, partnership
or corporation, is employing or is about to employ any device, scheme
or artifice to defraud, or for obtaining money or property by means
of any false or fraudulent pretense, representation or promise, the
said Attorney General may require said person, partnership or cor­
poration to file with him a statement in writing under oath of all the
facts concerning the same. From the action of the Attorney-General,
there is an appeal to the courts, with final resort to the Court of Appeals.
Section 14 provides that any person, partnership or corporation
having been served with any order of the Attorney General, or having
knowledge of the issuance of said order and while said order remains
in effect, either as originally issued or as modified who shall execute
or carry on any scheme or device against which said order has been
issued, or wilfully attempts to do so, shall be guilty of a misdemeanor
and, upon conviction, shall be fined not more than $10,000 or impris­
oned not more than two years or be subject to both fine and imprison­
ment, in the discretion of the Court.
Collections. Uniform Bank Collection Code as recommended by
American Bankers Association, see page 2333.
Contracts. The normal condition of all persons is one in which
they are capable of making any contract. The fourth and seventeenth
sections of the Statute of Frauds are in force in Maryland. It is no
longer necessary to show that the consideration for a special promise
to answer for the debt of another is in writing. A citizen can not
make a contract with an alien enemy during the continuance of hos­
tilities, but aliens, not enemies, may contract and hold real property
as fully as citizens. The later cases decide contract of infants to be
voidable and not void; and they are capable of ratification by infants
on arrival at age of twenty-one. The contracts of infants for neces­
saries are binding upon them. The contract of a lunatic is voidable
and not void. A married woman may engage in business, contract,
sue and be sued upon contracts and torts, as if unmarried. All
gambling contracts are void.
Conveyances. No estate in or title to any land lying within this
State, for any period above seven years shall pass or take effect unless
the deed conveying the same shall be executed, acknowledged and
recorded. Such deed shall be signed and sealed by the grantor, and
attested by at least one witness. Unless the contrary intention
appears, every deed is construed to pass the whole estate of the
grantor. Deeds of real estate should be recorded within six months
from date in county, or in Baltimore City, where land lies. Where
there are two or more deeds conveying the same lands, the deed first
recorded shall be preferred if made bona fide and upon good and
valuable consideration. A scroll with the word “seal” therein by
way of a seal, is sufficient, as “(signed) John Doe (Seal).” The
Deed of a body corporate must be signed in the corporate name by
the President or a Vice President, and the official Corporate seal
impressed on the deed, the seal to be attested by the Secretary of the
corporation.
Corporations are organized under the authority of Article 23 of
Bagby’s Code where most liberal provisions are made for general
incorporation, including such features as stock without par value,
issuance of stock for considerations other than cash, convertibility
of stock from one class to another class, cumulative voting, stock fully
paid and non-assessable, convenient amendment and consolidation,
etc. Every domestic corporation having capital stock, except rail­
road corporations and building associations, shall before the time
of incorporation pay for the use of the State a bonus tax for its author­
ized capital stock at the following rates, to wit:
Twenty cents for every thousand dollars of capital stock where
such authorized capital stock amounts to $1,000,000.00 or less, but
in no case less than $20.00.
An additional bonus tax of $150.00 for every million dollars or
fractional part thereof on amount of stock in excess of $1,000,000.00
and not in excess of $5,000,000.00.
An additional bonus tax of $20.00 for every million dollars or frac­
tional part thereof in excess of $5,000,000.00. For purposes of above
provisions as to bonus tax, stock without par value shall be treated
as if its par value were $100,000 per share. Corporations have per
petual succession, may carry on business anywhere, may issue bonds
and secure them by mortgage of all property including franchises. A
foreign corporation before doing business in this State must pay a fee
of $25.00 and file with the State Tax Commission of Maryland: (1)
An officially certified copy of its charter or certificate of incorporation;
(2) Annually thereafter a report to be filed on or before March 15th
in every year subscribed and sworn to by its president or treasurer
(or a majority of its board of directors) and accompanied by a fee
of $1.00 for filing such a report, showing (a) the corporate name; (b)
the names and addresses of its president, treasurer, secretary, and
members of its board of directors; (c) its main office in this State and
its principal office in the State of incorporation; (d) the amount of
authorized capital stock and the amount issued, and the number and
par value of the shares, and the names and addresses of the cor­
poration’s shareholders in this State, and the number of shares held
by each; and in such annual report shall be given such information
as may be required by the State Tax Commission in order to enable
it to determine the amount of capital employed in Maryland as of
January 1st of the year for which such report is filed; (e) the name
and address of its agent resident in this State, service of process
upon whom shall bind the corporation until the appointment of a sub­
stitute is duly certified to the State Tax Commission. Every officer
and every agent of such foreign corporation which fails to comply
with the above provisions, shall be subject to criminal prosecution,
and while such failure to comply shall not affect the validity of any
contract made with such non-complying corporation, no suit can be
maintained in the Courts of this State by such corporation until com­
pliance with above provisions. Both domestic and foreign corpora­
tions must pay to the State an annual franchise tax, the amount of
which varies, if a domestic corporation, with the amount of capital
stock of such corporation issued, outstanding and/or subscribed for,
and If a foreign corporation with the amount of capital employed by
it in this State as of the preceding first of January. The franchise
tax is payable on or before the first of August in each year. The
penalty for failure to pay the franchise tax, by the domestic corpora­
tion, is forfeiture of its charter, and by the foreign corporation is
forfeiture of the right to do business in the State.
No corporation may interpose the defense of usury in any action
at law or in equity. There is no period of limitations in this State
on judgments against foreign corporations.
Courts. The Circuit Courts of the counties have common law
jurisdiction in all cases involving more than $50.00, and in all cases
involving title to land; and equity jurisdiction in all cases involving
more than $20.00. The Circuit Court of Baltimore City and the Cir­
cuit Court No. 2 of Baltimore City have exclusive equity jurisdiction
in the city. The Superior Court of Baltimore City, the Court of

2186

BANKING AND COMMERCIAL LAWS—MARYLAND

Common Pleas of Baltimore City, and the Baltimore City Court have
concurrent common law jurisdiction in Baltimore City in cases involv­
ing more than $100.00. All records pertaining to the transfer of title
to land in Baltimore City are in the custody of the Clerk of the Superior
Court of Baltimore City, and in the counties, in the custody of the
clerks of the various Circuit Courts of the counties. All such records
are open to the public. The Orphans’ Court of Baltimore City, and
the Orphans’ Court of each county have exclusive probate jurisdiction.
In the counties justices of the peace have common law jurisdiction
to the amount of $100.00 (concurrently with the Circuit Courts from
$50.00 to $100.00). In Baltimore City the People’s Court has juris­
diction up to $100.00 and suits on small claims in Baltimore City
are brought in this Court instead of before the individual justices of
the peace.
Depositions. When the courts are satisfied, by affidavit or other­
wise, that there are material and competent witnesses residing with­
out the State, they will direct that a commission be issued to take
the testimony of such witnesses. The commissioners are selected by
the court, and must qualify before some person authorized to admin­
ister an oath in the state where they reside. The depositions, duly
certified by the commissioners, shall be admitted as evidence at the
trial of the cause, subject to the same objections and exceptions as
the same testimony would be if the witness had been personally present
in court and there examined. Parties have the right to be present
when the testimony is taken under the commission, and must receive
reasonable notice of the time and place. Interrogatories and cross­
interrogatories may be annexed to the commission or the witness may
be examined by counsel.
Descent and Distribution of Property. As to descent, see
Code 1924, Art. 46, and as to distribution, Code 1924, Art. 93. The
Rule in Shelley’s case has been abolished by Ch. 144, Acts 1912,
Code 1924, Art. 93, sec. 342.
Dower. The common-law right of dower exists in Maryland, and
extends to equitable estates. By act 1898, the husband’s dower
was created; an estate of the husband in his wife’s estates of inherit­
ance, exactly equivalent to the wife’s dower in her husband’s estate.
A devise or bequest of real or personal property to the wife or husband
shall be construed to be in lieu of dower in lands or share of personal
estate, respectively, unless otherwise expressed in the will. If the
widow or widower renounces formally in writing, however, such pro­
vision made for her or him by the will within six months after the
grant of administration on the estate of the deceased husband or
wife, the dower right and the share of personal property remain undis­
turbed. “The surviving husband or widow shall be barred of his
or her right of dower in real or personal estate, unless within six months
after the first grant of letters testamentary, he or she shall file a
written renunciation.” (See Married Women.)
Executions may issue and judgments may be renewed or revived
by scire facias at any time within twelve years from date of judgment
or from the expiration of any stay, and may be thereafter levied on
any property of the defendant. In the circuit courts for the counties
there is a stay until the first Thursday of the term succeeding the
rendition of the judgment, provided the judgment is obtained at the
second term after the defendant is summoned. There is no stay upon
judgments rendered in the courts of Baltimore City or by justices of
the peace in the city or counties, but execution may issue forthwith.
The defendant may stay the execution by superseding with sureties
for six months. Copy of docket entries of judgment when recorded
in another county makes the judgment a lien there.
Exemptions. No homestead law. Wearing apparel, books and
tools (not kept for sale) and $100 of money, land or goods, and $500
payable to the debtor as life, health, or accident insurance are exempt
from execution, except (1) on judgments for breach of promise to
marry or seduction and (2) aggregate exemptions not to exceed $500
and (3) not applicable to any but actual bona fide residents of this
State.
Foreign Corporations. (See Corporations.)
Foreign Judgments. Judgments of the courts of other states
certified under tne act of congress, are proper causes of action against
any person subject to the process of the courts of this State.
Fraud. When any false representation is made by one to another
with the intent to defraud, and the defrauded party, thinking the
alleged fraud to be true, acts upon it, any contract thus made can
not be enforced. But if the injured party knows such representations
to be false it can not be said to have influenced his conduct. For
general doctrine in this State see McAleer vs. Horsey 35 Md. 439.
Giving checks or drafts without provision for acceptance is prima
facie evidence of intent to defraud, and is punishable as a crime
unless such provision is made within ten days. Every person buying
merchandise in bulk shall demand and receive from the vendor a
written statement under oath containing the names and addresses
of all creditors with amount of indebtedness at least ten days before
the sale is consummated. The vendee at least ten days before con­
summating such sale shall notify all of said creditors either personally
or by registered mail of such proposed purchase and is required to
see that the purchase money is applied to the payment of the vendors
debts shown on said statement. A sale or transfer of goods in bulk
without such notice shall as to all subsisting creditors of the vendors
be void.
Special provisions of criminal law apply to the making of false
financial statements.
Garnishments. (See Attachments.)
Holidays. Legal holidays in Maryland are: January 1st (New
Year’s Day), February 22nd (Washington's Birthday), March 25th
(Maryland Day), Good Friday, May 30th (Decoration Day), July 4th
(Independence Day), the first Monday in September (Labor Day),
September 12th (Defender’s Day), October 12th (Columbus Day),
November 11th (Armistice Day), December 25th (Christmas Day);
and when any of these days falls on Sunday the ensuing Monday is
a legal holiday. All days of General and Congressional elections
throughout the State, and all special days that may be appointed or
recommended by the Governor of this State, or the President of the
United States, as days of Thanksgiving or Fasting and Prayer, or other
religious observance, or for the general cessation of business, shall also
be regarded as Legal Holidays, and all bills, drafts, checks and notes
presented for payment or acceptance on these said days shall be
deemed to be presented for acceptance or payment on the secular
or business day next succeeding such holiday. Monday is treated
as Sunday when immediately preceded by one of the holidays afore­
said.
Husband and Wife.
(See Dower, and Married Women.) In
this State the husband is not liable for wife’s ante-nuptial debts
or contracts. Husband is liable for necessaries of wife. Husband
has same interest in wife’s estate as wife has in husband's estate.
Married women are expressly authorized to become partners and to
contract with husband. Either can relinquish interest in other's
real estate by joint or separate deed, or by agent or attorney properly
constituted. The wife’s property is protected by the Constitution
from the debts of the husband.
Interest. The legal rate of interest is 6 per cent per annum. A
person proved guilty of usury forfeits the excess over the aggregate
of the real sum lent and 6% interest thereon. Judgments bear interest
from the date of the verdict. A corporation cannot plead usury.
Judgments are liens for twelve years from the date of rendition
on any interest of the defendant in real or leasehold property within
the county where rendered. They can be transferred from one county
to another by sending a copy of the docket entries to the clerk for
record. The lien commences from the date of the entry of the docket
entries by the clerk. Judgments are not liens on mortgages or other
personal property until execution has issued and the writ Is in the
hands of the sheriff.


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Liens. (See Judgments.) Mechanics’ Liens. Every building
erected, repaired, rebuilt, or improved to the extent of one-fourth
of its value is subject to a lien for work done or materials furnished
for or about the same, except that there are no liens for materials
furnished in Baltimore City. Every machine, wharf, or bridge,
constructed or repaired is subject in like manner as buildings are, to
a lien. All boats or vessels are subject to a lien for materials fur­
nished or work done in building, repairing, or equipping the same.
Garages are given lien for storage and accessories. To secure the
lien and lay foundation for enforcing it, the material man must within
six months after the last work has been furnished, file a claim in the
circuit court for the county. The liens are enforced by scire facias
or by bill in equity.
Limitations of Suits. Accounts and notes are barred after three
years, sealed instruments after twelve years; judgments twelve years
except against foreign corporations (no limitations). A verbal promise
or acknowledgment will revive a debt barred by the statute.
Married Women. Act of 1898, Chap. 457, Code Art. 45, repeals
and re-enacts the entire law in this State. Married women may hold
and dispose of their property lawfully as if unmarried, but husband
must join in conveyances of real estate to release his dower interest.
Married women may engage in business, contract, sue, and be sued
upon contracts and for torts, as if unmarried. Married woman Is
alone liable for ante-nuptial debts and contracts. Husband is still
liable for necessaries. Where husband or wife is adjudged a lunatic
upon inquisition, and the finding remains in force, other spouse may
convey after acquired property by separate deed, as if unmarried.
Surviving spouse is also allowed ahead of creditors $75 if no children,
$150 if children. Surviving spouse is entitled to (a) one-third of
net personal estate if there are children or one-half thereof if there
are no children and (b) the same share in net real estate or at option
of surviving spouse in lieu of share of real estate surviving spouse,
either husband or wife, may elect to take dower rights which are
one-third of real estate for life ahead of creditors unless dower rights
have been specifically waived or waived by joining in deeds. (See
husband and wife, and Dower.)
Mortgages are executed, acknowledged, and recorded same as
deeds, and are not valid against creditors unless recorded within six
months after date. There must be an affidavit made by the mort­
gagee or his agent at any t ime before recording, that the consideration
is true and bona fide. If made by agent, he must, in addition, make
oath that he is the agent of the mortgagee. A like affidavit is required
to chattel mortgages, and absolute bills of sale, both of which must be
recorded within twenty days. The lien of a mortgage may. by ceasing
to pay interest or any installment of the principal for twenty years,
be barred. They may be foreclosed at any time after the debt becomes
due and before the lien is barred.
Notes and Bills of Exchange. Negotiable instruments are
defined by Gh. 119 of the Laws of 1898, which repeals all laws, incon­
sistent with the provisions of this act. Section 20 provided as follows:
"An instrument to be negotiable must conform to the following
requirements: 1. It must be in writing and signed by the maker
or drawer. 2. It must contain an unconditional promise or order
to pay a sum certain in money. 3. Must be payable on demand,
or at a fixed or determinable future time. 4. Must be payable to
order or to bearer; and 5. Where the instrument is addressed to a
drawee he must be named or otherwise indicated therein with reasonaole certainty.” its negotiability is not affected by a seal, or by a
provision which authorizes the sale of collateral securities in case the
instrument be not paid at maturity, or authorizes a confession of
judgment if the instrument be not paid at maturity; or waives the
benefit of any law intended for the advantage or the protection of
the obligor; or gives the holder an election to require something to
be done in iieu of payment of money. It Is not necessary that paper
should be made payable at a bank or any fixed place. To charge
indorser, notice of non-payment and of protest must at once be given
to him. The time of maturity is regulated by Art. 13 as follows;
“Section 104 Time of Maturity. Every negotiable instrument is
payable at the time fixed therein without grace. When the day of
maturity falls upon Sunday, or a holiday, the instrument is payable
on the next succeeding business day. Instruments falling due on
Saturday are to be presented for payment on the next succeeding
business day, except that instruments payable on demand may, at the
option of the holder, be presented for payment before 12 o’clock noon,
on Saturday, when the entire day is not a holiday." Legal holidays.
(See Holidays.) By act 1898, Oh. 198, it shall be lawful for banks
and bankers in the city of Baltimore to close their doors for business
at 12 o’clock noon, on each and every Saturday in the year, and every
Saturday in the year, after 12 o’clock noon, shall be a legal half­
holiday, so far as regards the presenting for payment or acceptance,
and the protesting and giving notice of the dishonor, of bills of exchange
and other negotiable paper, and for these purposes shall be considered
as the first day of the week, or Sunday, and all negotiable paper shall
be deemed to be presentable on the secular day next succeeding.
Power of Attorney. Every power of attorney authorizing an
agent or attorney to sell and convey any real estate, shall be attested
and acknowledged in the same manner as a deed, and recorded prior
to or with the deed executed in pursuance of such power of attorney.
A corporation shall have power to appoint an attorney for the same
purpose, under its corporate seal. Such power of attorney shall be
deemed to be revoked when the instrument containing the revocation
is recorded in the office in which the deed should properly be recorded.
Probate Law. (See Administration of Estates and Wills.)
Protest is usually made by notary public. Notary must keep
register of protests. A protest of notary public is prima facie evidence
of non-acceptance or non-payment, and of the presentment of said
note for payment, or of said bill for acceptance or payment, at the
time and in the manner stated in the protest, and the protesl shall also
be prima facie evidence that such notice has been sent or delivered in
the manner therein stated. (See Notes and Bills of Exchange.)
Replevin is a remedy to recover specific goods and chattels to
whose possession the plaintiff is entitled. Also the proper remedy
to recover possession of goods distrained unlawfully. Bond must
be given to the State of Maryland, and any party having an interest
in the property, may, upon breach of any covenant in bond, maintain
an action in the name of the State for his or her use.
Sales and Notices. Acts 1910, Ch. 346, adopts the Uniform
Sales Act. (Art. 83, secs. 22 to 99 incl.)
Taxes. The county commissioners of the several counties of the
State, and the mayor and city council of Baltimore City are directed
to levy a tax annually upon real and personal property situated within
the State. The County and/or City tax on Banks located and in
business anywhere in Maryland is uniformly 1 per cent. The prop­
erty of religious, charitable, benevolent, and educational institutions,
and cemetery companies is exempt from taxation. On timely applica­
tion exemption may be had for manufacturer's tools and machinery
in actual use from Municipal taxation in Baltimore City and in some
of the Counties. Collectors may sell property to compel payment
of overdue taxes, upon giving due notice of sale, and complying with
other requisites of statute, and any person interested in property may
redeem within twelve calendar months from date, and in default
of redemption, title to property vests in purchaser. Taxes are con­
sidered in arrears on first day of July next succeeding the date of
their levy.
Uniform State Laws. Intended for adoption by all the States
and adopted by Maryland: 1. State Law for Aeronautics; 2. Air
Licensing Act; 3. Bank Collection Code; 4. Bills of Lading; 5. Cold
Storage; 6. Extradition of Persons of Unsound Mind; 7. Federal Tax
Lien Registration; 8. Fiduciaries; 9. Flag; 10. Foreign Acknowledg­
ments; 11. Foreign Depositions; 12. Foreign Executed Wills;

BANKING AND COMMERCIAL LAWS—MASSACHUSETTS
13. Fraudulent Conveyance; 14. Interparty Agreement; 15. Limited
Partnership; 16. Negotiable Instruments; 17. Partnership; 18. Proof
of Statutes; 19. Sales; 20. Stock Transfer; 21. Warehouse Receipts.
Wills of land or personal property, and any codicil thereto, must
be in writing, signed by the testator, or some one else for him, in his
presence, at his request, and witnessed by two or more credible wit­
nesses, as and for last will and testament of the testator, in the presence
of all the witnesses thereto. Nuncupative wills invalid except in
case of disposition of personal property by soldiers in actual military
service or mariners at sea. Every will or other testamentary instru­
ment executed without this State in the mode prescribed by law,
either of the place where executed or of the testator's domicile, or
according to the forms required by the law of this State shall be
deemed to be legally executed, and shall be of the same force and effect
as if executed in the mode prescribed by the law of this State, pro­
vided, said last will and testament is in writing and subscribed by
the testator; and if the testator was originally domiciled in Maryland,
although at the time of making the will or at the time of his death
he may be domiciled elsewhere, the said last will or testamentary
instrument so executed shall be admitted to probate in any orphans’
court of this State; and when so admitted shall be governed by and
construed and interpreted according to the law of Maryland, without
regard to the lex domicilii, unless the testator shall expressly declare
a contrary intention in said will or testamentary instrument. Code
Art. 93, sec. 334. No will, testament, codicil, or other testamentary
paper shall be subject to caveat or other objection to its validity
after the expiration of three years from its probate. (Acts 1894,
Ch. 405.) When a person is unheard of for above seven years, and
supposed to be dead, the Orphans’ Court, under the provisions of
Act of 1908, Ch. 125, may grant letters testamentary or of adminis­
tration as the case may be on his estate.

SYNOPSIS OF

THE LAWS OF MASSACHUSETTS
RELATING TO
BANKING AND COMMERCIAL USAGES
Revised by Maurice L. Katz, Attorney at Law, 629-630 Slater Bldg.,
Worcester, Mass.
(See Card in Attorneys’ List.)
Accord and Satisfaction, An accord is an agreement whereby
one of the parties undertakes to give or perform, and the other to
accept in satisfaction of a claim, liquidated or in dispute, and arising
either from contract or from tort, something other than or different
from what he is or considers himself entitled to. and a satisfaction is
the execution of such agreement.
Where the claim is undisputed, and is settled only In part, such
part payment is without consideration and the balance can be collected.
This, however, can be remedied by taking a release under seal which
purports a consideration in full settlement of the entire claim. In
order to take advantage of a suit pending in court because of accord
and satisfaction, it must be specially pleaded in the defendant's answer.
However, In case of a disputed claim the acceptance of a smaller
sum in lieu of the entire claim is a valid consideration and therefore
Is a full release on the entire claim.
Accounts. Ex parte affidavit on claims and accounts is of no
value. They must be established by evidence produced in court
after suit brought either by testimony, deposition, or other material
evidence.
Acknowledgments and Deeds. Acknowledgments may be made
before any justice of the peace, notary public or special commissioner
in the State; when the acknowledgment Is made by any person with­
out this State and within any other state, territory or district of the
United States, it may be made before any officer of such state terri
tory or district authorized by the laws thereof to take the proof and
acknowledgment of deeds, and when so taken there shall be attached
to the certificate of acknowledgment a certificate of the secretary of
the state or territory in which such officer resides, under the seal of the
state or territory, or a certificate of the clerk of a court of record of such
state, territory or district, in the county in which such officer resides,
under seal of said court, certifying as to the authority, of such officer
to take acknowledgments and as to the genuineness of his signature
In deeds where there is more than one grantor, the acknowledgment
of one of them Is sufficient. Official taking acknowledgment should
state date of expiration of his commission.
No separate examination or acknowledgment of wife joining in a
release of dower necessary. Conveyances of land are made by deed
under seal executed by the grantor or attorney having authority
therefor. A conveyance in fee. for life or for a term exceeding seven
ears, shall not be valid, except as against the grantor and persons
aving actual notice of it, unless recorded in the county in which the
real estate is situated. Deeds should be under seal. No subscribing
witness is necessary. Release of dower homestead and other interests
must be explicitly stated in deed, wife’s joining in deed merely, being
insufficient. Husband and wife may make conveyances of real estate
to each other except by way of mortgage, as if unmarried, but no such
conveyance shall have any effect, either in passing title or otherwise,
until the deed describing the property to be transferred is duly acknow­
ledged and recorded in the registry of deeds for the district where the
land lies. Any interest in real estate may be transferred by a person to
himself jointly with another person or persons in the same manner in
which it might be transferred by him to another person, except a con­
veyance to himself and his wife as joint tenants, or as tenants by the
entirety. No interest in land except an estate at will can be created
except by instrument in writing or by operation of law.
Actions. There are three classes of actions contract, tort, and
replevin. Actions at law are begun by writs issued in blank form by
the clerks of the several courts. No declaration need be inserted in
the writ, except in cases of arrest on mesne process or of an attach­
ment of a vessel. Suits in equity are begun by filing a bill of complaint
with the Clerk of the Superior Court upon which a subpoena or order
of notice is issued by the clerk of the court. Actions begun by trustee
process must be brought in the county in which the trustee or one of
them resides or has his usual place of business.
Administration of Estates. Administration or probate is to be
taken out in county where deceased last resided. Executors or admin­
istrators are required to give a bond of about double the value of the
personal estate. An executor will be exempt from giving sureties if
testator so directs and all creditors are notified by publication or in
manner designated by probate court. An administrator will be ex­


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2187

empt if all persons interested in this State except creditors consent and
all creditors are notified by publication. In case a non-resident is
appointed executor or administrator, he must appoint a resident agent.
There are public administrators in each county to whom administration
is granted upon estates of persons who die intestate leaving property,
and not having any husband, widow, or heir in this State. Ancillary
administration may be granted upon the estate of a non-resident who
dies leaving property in this State. Every administrator and executor
shall file an inventory within three months, and publish notice of his
appointment. Notice of a debt, and demand for its payment should be
given to an executor or administrator within six months after his
appointment and the debt should be paid after six months and within
one year of the appointment. No suit can be brought by a creditor
against an executor or administrator within six months after hie
giving bond, except on a claim not affected by the insolvency of the
estate. No suit can be brought against an executor or administrator
who has published notice of his appointment, after one year from
time of his giving bond, unless he has received new assets after the
expiration of the one year, or unless further time Is allowed by court.
A creditor whose claim does not accrue within the one year may
cause assets to be reserved to answer to his claim. When the estate
Is insufficient to pay all claims, the executor or administrator shall
represent the estate insolvent and commissioner will be appointed
to receive proof of claims or the Court may receive and act upon the
claims Claims for funeral expenses, last sickness, and charges of
administration, are not affected by the insolvency of the estate.
Executors and administrators shall render an account at least once
a year
Aliens have the same rights and liabilities as natural persons do,
only so, during the continuance of peace between the country of the
alien and our own country. When war exists between the respective
nations, the alien cannot sue but may be sued by a citizen of this
country. Ordinarily contract rights are suspended during the oper­
ation of war unless the alien is within our territory, then he may be
sued as above stated.
Arrest. Right of arrest exists irrespective of domicile of either
party. The debtor may be arrested and imprisoned on execution
after the same is obtained, if the execution is not otherwise satisfied,
and the debtor has property which ne conceals and fails to surrender
to his creditors, and he fails to make a fair and full disclosure of his
property and his ability to pay money in reference to the debt owed
by him. after the creditor has cited him in the District Court where
Supplementary Process is had, and after the examination by the
creditor or his attorney it is found that he has money or property and
won't pay, then the Judge may order weekly payments or place the
debtor in jail for contempt of court by reason of his failure to obey
the court orders generally. If no assets are discovered the debtor wiil
be discharged and the proceedings dismissed. The creditor may,
one year from date thereof, cite the debtor into court once again and
examine him anew as to his assets, property, and ability to pay on the
debt. (See Acts of 1927. (Mass.) Chp. 334—Supplementary Process)
Assignments for benefit of creditors. A voluntary assignment to
trustees for benefit of creditors can not be avoided by creditors who
assent thereto, except by proceedings in bankruptcy begun within
four months or by proof of fraud. If there is property in excess of
the claims of creditors who have assented, the excess In hands of the
trustee can be reached by trustee process. As a matter of procedure
the assignee usually waits the full four months from date of assign­
ment before making distribution amongst asserting creditors.
Where Claims Are Assigned. The assignee, at common law, by
virtue of his assignments could sue on the contract, but only so in
the name of his assignor where no written assignment appeared.
By Statute. If the assignment is evidenced by a written docu­
ment, then by virtue of the statute hereon, the assignee has an election
of remedies, to wit. sue in his own name, or in the name of his assignor,
on the contract so assigned.
An assignment is considered a legal chose in action, and the assignee
may prove a claim in bankruptcy in his own right and name, provided
the assignment is made prior to the institution of bankruptcy proceed­
ings, subject, however, to all defences and to all rights of counter-claim,
recoupment, or set-off to which the debtor would have been entitled
if the action had been brought by the assignor. The assignee’s
rights and liabilities are those of the assignor purely, and it should be
remembered that the assignee is not considered as a holder in due course
of trade, as a holder of a negotiable instrument. The assignee steps
into the shoes of the assignor and all personal defences available against
the assignor are good as against the assignee.
Where Wages Are Assigned. By virtue of Statute, future wages
of a person may be assigned for a period of two years from the date
of the assignment only and it shall be valid to all intents and pur­
poses, if the document is formally executed, the consderation shown
in apt words, rate of interest, signed by the parties thereto, and a copy
delivered to the assignor by the assignee. Three-fourths of the weekly
wages of the assignor shall be exempt from assignment and no assign­
ment shall be valid which does not so state on its face. No such
assignment shall be valid when made by a married man unless the
written consent of his wife is attached thereto. A standard form of
assignment may be found in Chap. 154 of the General Laws.
Future Earned Wages may be assigned for a period of only one
year, where the assignment is given as security for a loan of money
less than *300 in amount. The employer must accept the order of
the assignment by a writing attached to the assignment and recorded.
If the assignor is married, then it is necessary to a valid assignment
of his wages that the wife by written consent agree- to the assignment
and such written consent must be attached to the assignment Ten
dollars of the assigned wages must be exempt and must be so stated on
the face of the assignment when recorded in order to be valid.
Notice to Third Persons or Creditors When. Until the assign­
ment is placed on record at the City Hall, in the office of the City
Clerk or Town Clerk, in the place where the assignor lives, or if he Is
a non-resident of the State, then in the city oi town where he is em­
ployed, to be effective against attaching creditors.
No assignment of future earnings shall be valid against a trustee
process unless before service of the writ on the alleged trustee, the
assignment has been duly put on record where the assignor resides
at the time of such record.
Attachment. All real estate, goods, and chattels not exempt,
may be taken in attachment on the original writ and held as security
for judgment, except that lands and tenements can not be attached
in suits involving less then $20. Attachments may be made in suits
by or against non-residents as well as in suits by or against residents.
No bond is required to make an attachment. Shares of stock in
corporations cannot be attached except by bill in equity. Attachment
of shares of stock is not valid against a bona fide transfer although
not recorded in book or corporation. Debtor may dissolve attachment
by furnishing bond with sureties to pay judgment obtained or value of
property attached determined by appraisement. Debtor against
whom judgment is rendered may be subjected to sworn examination
touching his property under the Supplementary Process Statute. An
attachment is dissolved by death of the defendant if administration
Is granted upon his estate upon application made within one year
after his death. Levy must be made on execution obtained by
attachment on real estate within 30 days from date of judgment.
Banks. The banking business is extensively regulated by statute.
In general, savings banks, co-operative banks, trust companies, or
other corporations or persons doing banking business in Massachusetts
are subject to supervision of commissioner of banks. (General Laws,
ch. 167, ch. 168, ch, 169, ch. 170, ch. 1721. No foreign banking asso­
ciation or corporation shall transact business in Massachusetts until
it has received certificate from board of bank incorporation. For ex­
tensive provisions relative to Savings Banks, see Gen. Laws, ch. 168.

2188

BANKING AND COMMERCIAL LAWS—MASSACHUSETTS

The trust company is the prevailing form of banking institution.
Fifteen or more persons associating by written agreement may. upon
compliance with statute, become a trust company. Agreement of
association must set forth corporate name, purpose, city or town in
Massachusetts where business is to be transacted, amount of capital
stock and number of shares. Notice of intention to form trust com­
pany shall be given to board of bank incorporation, and such notice
must be published. Unless the board issues a certificate that public
convenience and advantage will be promoted by establishment of
such a trust company, no further proceedings shall be had, but after
one year the application may be renewed. After the first meeting of
the subscribers the president and majority of board of directors
execute in duplicate articles setting forth copy of agreement of associ­
ation, names of subscribers and names and residences of officers,
date of first meeting, one of the certificates is submitted to bank
commissioner, the other together with records of proposed corporation
to commissioner of corporations and taxation. Approval by com­
missioner must be endorsed if he finds that legal requirements, in­
cluding certificate of convenience, have been met. The articles are
filed with the secretary of state, with filing fee of one twentieth of
1 per cent of capital stock, and certificate of incorporation issues.
Before business can be commenced a certificate authorizing such
must be obtained from board of bank incorporation. (Gen. Laws,
cn. 172, section 11). A director of trust company must hold at least
ten shares of unpledged stock, and majority of directors must be citi­
zens of and resident in Massachusetts, and not over one-third of the
directors shall be directors in any other such corporation. Except
in smaller municipalities capital stock of trust company must be not
less than $200,000; shares par value of $100 each. Entire capital
stock must be paid in in cash. Stockholders of trust company shall
be personally liable, equally and ratably and not one for another,
to amount of their stock therein at par in addition to amount invested
In such shares, for all contracts, debts and engagements of the corpo­
ration. In case of impaired capital, bank commissioner has authority
to act. Commissioner of banks has extensive power to require returns
and to supervise and examine. Savings departments may be estab­
lished. The kinds of business which may be done are prescribed by
statute with considerable detail.
Employees or officers of a bank are liable to fine or imprisonment
If they receive a deposit knowing that such bank is insolvent.
Bills and Notes. The law of negotiable instruments is governed
by the Negotiable Instruments Law, as amended, where applicable;
In other cases by the law merchant. A person becoming a party
to a non-negotiable promissiory note payable on tme, by signature
In blank on the back thereof, is entitled to notice of non-payment
same as an Indorser. A depositary of funds, subject to withdrawal by
check or demand draft may pay a check or demand draft drawn on
It by a depositor having funds on deposit to pay same, notwithstanding
his death, upon presentation within ten days after its date.
Protest of bill, note or order duly certified by notary public under
his hand and official seal Is prlma facie evidence of facts, stated In
■uch protest and of giving notice to drawer or Indorser.
There are various statutory provisions bearing upon the validity
of the notes of municipalities of this Commonwealth. Where a nego­
tiable instrument Is not payable on demand, presentment must be
made on the day it falls due. Where it is payable on demand present­
ment must be made within a reasonable time after its issue.
An accommodation party to a negotiable instrument is liable thereon
to a holder in due course notwithstanding such bolder at the time of
taking the instrument knew him to be only an accommodation party.
When the day or the last day. for the performance of any act, includ­
ing the making of any payment or tender of payment, authorized or
required by statute or by contract falls on Sunday or on a legal holi­
day, the act may be performed on the next succeeding secular or busi­
ness day. unless it Is specifically authorized or required to be performed
on Sunday or on a legal holiday.
Every negotiable instrument is payable at the time fixed therein
without grace, except that three days of grace shall be allowed upon a
draft or bill of exchange made payable within Massachusetts at sight
unless there is an express stipulation to the contrary. Where the day,
of maturity falls upon Saturday, Sunday, oi a holiday, instrument is
payable on next succeeding business day which is not a Saturday.
Instruments payable on demand may, at option of holder, be presented
for payment before twelve o’clock noon on Saturday when that entire
day is not a holiday: provided however that no person receiving any
check, draft, bill of exchange or promissory note payable on demand,
■hall be charged with any neglect or omission of duty or incur any
liability, for not presenting for payment or acceptance or collection
such check, draft, bill of exchange, or promissory note on a Saturday;
provided also that the same shall be duly presented for payment,
acceptance, or collection on the next succeeding business day.
Under certain circumstances the original named payee of order
paper may be a holder in due course.
No ban! shall be liable to a depositor, or to the drawer of a bill of
exchange upon the bank, for an amount charged to or collected from
him on account of payment by such bank of a negotiable instrument
upon which the signature of any party is forged, or which is made,
drawn, accepted or indorsed without authority, or which is materially
altered or the amount of which is raised; unless within one year after
return of such negotiable instrument to such depositor or drawer,
he shall notify the bank in writing that, as the case may be, the instru­
ment was made, drawn accepted or indorsed without authority, that
signature of a party to instrument is forged, or that instrument has
been materially altered, or that the amount has been raised.
Bills of Lading. The so-called Uniform Bills of Lading Act is in
force, and has been held constitutional by the Supreme Judicial
Court. A bill in which it is stated that the goods are consigned or
destined to a specified person is a non-negotiable or straight bill A
bill in which it is stated that the goods are consigned or destined to
tbe order of any person named in such bill is a negotiable or order bill.
A non-negotiable bill cannot be negotiated, and indorsement of such
a bill gives transferee no additional right. A negotiable bill may be
negotiated by indorsement of person to whose order goods are deliv­
erable by tenor of bill. Such indorsement may be in blank or to a
specified person. If indorsed to a specified person it may be nego­
tiated again by the indorsement of sued person in blank or to another
specified person. Subsequent negotiation may be made in like man­
ner. A negotiable bill may be negotiated by any person in possession
of same, however such possession may have been acquired if, by the
terms of the bill, the carrier undertakes to deliver the goods to the
order of such person, or if at time of negotiation bill is in such form
that it may be negotiated by delivery. Indorsement of bill does not
make indorser liable for any failure on part of carrier or previous In­
dorsers of the bill to fulfil their respective obligations.
An> pro­
vision in an order bill that it is non-negotiable shall be void.
Bills of Sale. A bill of sale of personal property intended for
security must be recorded, the recording provisions as to mortgages of
personal property being applicable. See Chattel Mortgages. Ch. 265
of General Laws.
Blue Sky Law. Acts of 1921, ch. 499, approved May 27, 1921.
entitled Promotion and Sale of Securities. Act applies to no con­
tracts valid and effective before act became effective. Certain secur­
ities are exempted. Act defines at length what is meant by security
and sale. Persons dealing in securities within operation of act must
be registered and information specified must be furnished commission.
Certain classes of sales and certain securities are exempted from
operation of Act. Annual fee for broker, $50, for salesman, $2. Act
does not limit any statutory or common law right of any person to
sue civilly or right of state to punish for violation of any law. Com­
mission has power of inquiry, of summoning witnesses and of sus­
pending certain sales. Act has immunity provisions. Violation of
act punishable by fine of not more than $5,000 or imprisonment not
more than two and one-half years or both. Scope of law extended
by Acts 1924, ch. 487, which should be consulted.


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Chattel Mortgages. Chattel mortgages must be recorded in the
records of the city of town where the mortgagor resides when the
mortgage is made, and in the city in which he then transacts business,
every mortgage, must be recorded within fifteen days of the date,
until recorded the mortgage is not valid except between the parties
and record subsequent to time limited is void. If mortgage is given
by non-resident mortgagor, record must be made in city or town where
property then Is. If record in two places is required, and mortgage
Is recorded in one place within fifteen days, it may be recorded In
other place within ten days after date of first record. The mortgage
shall not be valid against a person other than the parties thereto until
so recorded.
A mortgage of after-acquired property is good as against an attach­
ing creditor where possession of the after-acquired property is obtained
before attachment thereof is made and subsequently retained by the
mortgagee. A mortgage is good, however, between the parties,
thereto, although unrecorded and no actual or constructive delivery
of the property takes place.
A Chattel Mortgage may be foreclosed by notice delivered per­
sonally or by publication, and notice with proof thereof must be
recorded where the mortgage was recorded. After sixty days, the
foreclosure becomes complete if the condition is not performed.
Chattel Mortgages may be assigned.
Upon performance of the conditions therein contained the mort­
gagor is entitled to a release.
Where the mortgagor defaults, then the mortgagee may sell the
goods at public auction by giving notice, in accordance with the time
as specified in the mortgage, or advertising sale for three successive
weeks in a local newspaper in said City or Town. The proceeds of
the sale are applied to repay all sums secured by the mortgage and
all costs and expenses incurred by reason of the sale. The surplus,
if any. shall be forthwith paid to the mortgagor.
Conditional Sales of personal property are valid in this juris­
diction and the vendor may retain title for the unpaid purchase price
therefor. It is usually a written formal document. It need not be
recorded and will be good generally as against an attachment of the
property in the hands of the conditional vendee, except by special
statute
Where the sale of personalty consists of household furniture, or
other household property, then if title still remains in the vendor til]
the last payment has been made, the vendee must be given thirty
days notice in writing by the vendor as to the breach of condition of
sale before the goods or furniture can be repossessed, and also attached
thereto by the vendor to said written noti -e must be an itemized
statement showing amount due. If seventy-five per cent of the pur­
chase price has been paid on the contract when the vendee so requests,
the vendor must sell the goods at public auction and the proceeds
shall pay the vendor his balance due, and any surplus over and above
this shall forthwith be paid to the vendee.
Corporations. By special act of 1903, chapter 437, the law of
business corporations was revised and as amended, and now codified
in General Laws, applies to all corporations organized in this common­
wealth for the purpose of carrying on business within the common­
wealth for profit, except the following: Banks, savings banks, co­
operative banks, trust companies, surety or indemnity companies,
safe deposit companies, insurance companies, railroad or street railway
companies, telegraph or telephone companies, gas or electric light,
heat or power companies, canal, aqueduct or water companies, ceme­
tery, or crematory companies, or any corporation which now have or
may hereafter have the right to take or condemn land, or to exercise
franchise in public ways, provided that corporations, formed for
purpose of dealing in real estate shall state the term of the duration
of the corporation, such term not to exceed fifty years.
Three or more persons may associate together and form a corporation
for carrying on any lawful business not included in the above provisions
Such a corporation must have a capital of not less than $1,000, if
having shares only with par value. There is no maximum limit.
Business corporations may create shares of stock with or without
par value, and corporations with stock with par value may. by
appropriate proceedings, change such stock to stock without par value.
The stock may be divided into two or more classes with such
references, voting powers restrictions and qualifications as may
e fixed by the agreement of association. Upon due organiza­
tion of the associates and filing a copy of the agreement of
association and articles of organization with the commissioner of
corporations and on payment of a fee of one-twentieth of 1 per cent of
total amount of authorized capital stock with par value, and five cents
per share for all authorized shares without par value, but in no case
less than $50, a certificate of incorporation is issued by the secretary of
state. The capital stock may be issued for cash, property, tangible or
intangible services or expenses, but not for notes. The amount of
capital stock may be increased from time to time. The corporation
must have not less than three directors, president, clerk and treasurer.
The directors, treasurer, and clerk are elected by the stockholders.
The president is chosen by and from the board of directors. The clerk
must be a resident of the commonwealth. Meetings of stockholders
must be held within the commonwealth, but directors may meet
within or without the commonwealth. Voting by proxy is per­
mitted, but no proxy dated more than six months before the
meeting named is valid. Any corporation may bold, purchase, con­
vey mortgage or lease such real or personal property as the purposes
of the business may require.
Every such corporation is required to file an annual report of its
condition, and if its capital stock is over $100,000, shares without par
value being taken as of $100 in value, to file a written statement
under oath by an auditor. It is also required to make an annual
return to the tax commissioner.
Every foreign corporation which has a usual place of business
here, or is engaged here permanently or temporarily in the construc­
tion, erection, alteration or repair of a building, bridge, railroad, rail­
way or structure of any kind, shall before doing business here appoint
the commissioner of corporations, Its attorney for the service of proc­
ess, such authority to continue as long as any liability remains out­
standing against it in this commonwealth, and shall file with the
commissioner of corporations a copy of its charter, articles or certifi­
cate of incorporation, by-laws, and a certificate setting forth ita
name, location of principal office, names and addresses of its officers,
date of its annual meeting, amount of its capital stock authorized and
Issued, the number and par value of its shares, the amount paid
thereon, and details of any payment thereof not made in money.
Such corporations are required to file annual statements with the
commissioner of corporations showing their condition. If it fails to
file a copy of the charter, by-laws, etc., as above. It cannot maintain
any action started by it in any court in this State. This has to be
pleaded by a Plea in Abatement, or may be otherwise specifically
pleaded, in each action.
Courts. Terms and Jurisdiction. Trial justices may severally
hold courts within the counties for which they are appointed, and
shall have original jurisdiction, exclusive of the superior court, of all
actions of contract, tort, or replevin, where the debt or damages
demanded or value of the property alleged to be detained does not
exceed $100, and concurrent jurisdiction with the superior court of
such actions where such amount exceeds $100 and is less than $300.
District courts may in their respective counties have original juris­
diction, exclusive of the Superior Court, of actions of contract, tort
or replevin, in which the debt or damages demanded or the value of
the property alleged to be detained does not exceed $100 and have
original and concurrent jurisdiction with the Supreme Court of actions
of contract, tort replevin in which the debt or damages demanded or
the value of the property alleged to be detained is more than $100.
The former limitation upon the jurisdiction of district court (of cases
under $3000) has been removed and the district courts now have con­
current jurisdiction with the superior court over all actions of contract
or tort. The supreme judicial court has original jurisdiction in equity
matters and may on appeal hear all matters determined by the pro-

BANKING AND COMMERCIAL LAWS—MASSACHUSETTS
bate court, and determine questions arising under wills. Superior
court has jurisdiction where the amount claimed exceeds $20. Munici­
pal court of the city of Boston has jurisdiction concurrently with
superior court in the county of Suffolk, in actions where the debt does
not exceed $5,000, provided one or more of the defendants resides or
has his usual place of business in the county of Suffolk. The Land
Court has exclusive original jurisdiction for registering titles to real
estate under the Torrens system.
The Probate Courts have jurisdiction over administration of estates
of deceased persons, matters of adoption, guardianship, conserva­
torship, trusts under wills and written instruments, petitions for
separate support, and of partition of land, and divorce. There is a
Probate Court and Registry of Probate in each county.
Equity jurisdiction is lodged in the Superior Court and in Supreme
Judicial Court. By statute Probate Courts have jurisdiction in equity
In certain special matters.
Death. Where a person is absent and unheard from for a period
of seven years, said person is presumed to be dead in legal theory.
Depositions. Taking of such Is governed by statute and rules of
courts. The commission issued to take depositions contains full
Instructions to magistrate how to proceed.
Descent and Distribution of Property of Decedents. After
deducting widow's allowance and allowances for minor children,
and payment of debts and expenses of administration, the remaining
personal and real estate is distributed as follows: If deceased leaves
no issue surviving husband or widow shall take $5,000 and one-half
of remaining real and personal property. If deceased leaves issue,
surviving husband or widow shall take one-third of remaining real and
personal property. If deceased leaves no kindred, surviving husband
or widow shall take whole of remaining real and personal property.
A husband on death of wife shall hold for his life one-third of all
land owned by her at any time during coverture, estate known as
tenancy by curtesy. Wife is entitled to dower at common law. But
in order to be entitled to such curtesy or dower election and claim
therefor must be filed in registry of probate with six months of approval
of bond of executor or administrator, and such election is a waiver
of the interests on real property above mentioned. Probate Court
assigns dower or curtesy. Rights of curtesy which exist on February
t, 1919, may be claimed as above provided, but in such case husband
shall take no other interest in real or personal property of wife, and
except as above preserved curtesy at common law is abolished.
Subject to all the above, the rest and residue of intestate property
is distributed as follows: 1. In equal shares to children and issue of
any deceased child by right of representation; if there is no surviving
child then to the other lineal descendants if all are in same degree of
kindred, otherwise by right of representation. 2. If intestate leaves
no issue, then in equal shares to father and mother. 3. If no issue
nor mother, then to father. 4. If no issue or father, then to mother.
5. If no issue, father or mother, then to brothers and sisters and to
Issue of deceased brothers or sisters by right of representation; if
no surviving brother or sister, then to issue of such equally if all In
samo degree of kindred to intestate, otherwise by right of represen­
tation. 6. If he leaves no issue, no father, mother, brother or sister
or issue of deceased brother or sister, then to next of kin in equal
degree, but if there are two or more collateral kindred in equal degree
claiming through different ancestors, those claiming through nearest
ancestor are preferred. If intestate leaves no kindred, husband or
widow, estate escheats to commonwealth.
Executions can not issue until twenty-four hours after judgment
rendered, and an original execution must be issued within one year
after plaintiff is entitled to sue out the same. Original executions in
all courts are returnable within sixty days, alias executions five years.
Exemptions. Homestead, if recorded, to the value of $800.
Necessary wearing apparel of family, certain specified articles of
household furniture, and $300 worth in addition thereto, library, $50;
tools and implements, $100; stock, $100; boats and fishing tackle,
etc., $100: one cow, six sheep, one swine, and two tons of hay, sewing
machine, necessary wearing apparel, pew in church, etc. Materials
and stock designed and necessary for carrying on his trade and intended
to be used or wrought therein, not exceeding $100 in value. Shares in
co-operative associations not exceeding $20 in value, funds of.railroad
relief societies assessment Insura nee benefits, uniforms, arms, and
equipments of militia officers.
Factor’s Act. A factor or other agent intrusted with possession
of merchandise or of bill of lading consigning merchandise to him with
authority to sell the same shall be deemed the true owner of such
merchandise, so far as to give validity to any bona fide contract of
sale made by him. Bona fide consignees from shippers in lawful
possession have liens for advances or securities to shipper. Bona fide
pledges from consignees or factors are also protected.
Frauds, Statute of. No action can be brought to charge an
executor or administrator on a special promise, to charge any person
upon a special promise to answer for debt, default or misdoing of
another, upon an agreement made on consideration of marriage, upon
a contract for sale of any interest in land, upon an agreement not to
be performed within a year, to charge a discharged debtor, unless the
promise, contract or agreement or some memorandum thereof is
signed by the party or by his authorized agent. No agreement to
make a will, or to devise or to give a legacy is binding unless in writing.
No contract of sale of persona) property of $500 or over is actionable
unless there is part payment, acceptance and receipt of part of the
goods, or some memorandum in writing signed by party to be charged
or his agent.
Gifts between Husband and Wife. Gifts of personal property
husband and wife shall be valid to same extent as if they were sole.
Holidays. January 1st, New Year's Day; February 22nd, Wash­
ington’s Birthday; April 19th, Patriot’s Day; May 30t.h, Decoration
Day; July 4th Independence Day; First Monday in September Labor
Day; October 12th, Columbus Day; November llth. Armistice Day:
Thanksgiving Day; December 25, Christmas Day.
Infants. Age of majority, male and female, is twenty-one. Infant
is liable for his torts and on contracts for necessaries. He may
repudiate or ratify all contracts after reaching majority. During
minority, he may sue by next friend, often called prochien ami.
Insolvency. Insolvency law suspended by National Bankruptcy
Act. Acts of Bankruptcy: (1) Fraudulent conveyance in order to
hinder, delay, or defraud his creditors; (2) Where insolvent has trans­
ferred his property to one or more of his creditors with intent to prefer
him or them; (3) Where insolvent has suffered or permitted a creditor
to obtain a preference through legal proceedings and not having dis­
charged such preference at least 5 days before sale or other disposition
of the property affected; (4) Made general assingment for benefit of
creditors; (5) Being insolvent applied for a receiver or trustee of his
property, or because of insolvency, a receiver or trustee put in charge
of his property; (6) Admitted in writing his inability to pay his debts
and a willingness to be adjudged a bankrupt; (7) While insolvent per­
mitted attachment, lien, etc., on his property and has not vacated the
same within thirty days therefrom. (1927 and 1928 amendments.)
Interest. Legal rate is 6 per cent. Loans of less than one thou­
sand dollars, interest shall not be charged exceeding eighteen per cent.
Not more than seven per cent can be charged bn bonds issued by
corporations.
Judgments. A judgment or decree of a court of record of the
United States or of any state thereof shall be presumed to be paid
and satisfied at the expiration of twenty years after it was rendered.
Limitation of Suits. Contract express or implied and not under
seal and not otherwise limited, six years; real actions, those upon an
attested note, if suit is brought by original payee or his executor or
administrator, and personal actions on contracts not limited, twenty
years. Absence from the State prevents the running of the statute
of limitations as to a defendant UDtil he comes into the State. If


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2189

the person entitled to bring an action is a minor or is insane or impris­
oned when the right to bring such action first accrues, such action
may be commenced within the time hereinbefore limited after the
disability is removed. The statute does not run against those residing
out of the State. See also Administration of Estates.
Married Women. The real and personal estate of a married
woman, acquired at any time, remains her sole and separate property,
not subject to the control of her husband, nor liable for his debts.
Married women may carry on trade or business, make contracts, sue
and be sued, in all matters relating to their separate property, and
such contracts are not binding upon the husband. Wife carrying
on business on own account must record certificate with city or town
clerk, neglect to do this renders her property so employed liable for
husband's debts, and renders husband liable for her debts thus con­
tracted.
Married Women. A married woman is also liable jointly with
her husband for debts due to the amount of $100 in each particular
case for necessaries furnished with the knowledge or consent to her­
self and her family where she is possessed with property valued at
$2,000 or more.
Where'a married woman performs work and labor for a third person
other than her husband and children shall be deemed, in the absence
of any agreement in writing to the contrary, to be performed on her
sole and separate account. She may pledge her husband's credit
for her support, but may also be personally liable for her purchases.
Mechanic’s Liens. Subject covered by statute. General Laws
Ch. 254.
Mortgages of Real Estate. Power of sale mortgage is univer­
sally used. Foreclosure is regulated by statute, requiring publication
once each week for three successive weeks in same newspaper published
in town or city where real estate is situated, first publication to be not
less than 21 days from date of Sale by Public Auction, and sale bars
redemption. Mortgages may also be foreclosed by entry and peace­
able possession for three years.
Real Estate; Fraudulent Conveyances are a ground for civil
arrest generally. An equitable action lies to recover property that
has been so conveyed fraudulently. Special attachmen' may be made
of realty which has been fraudulently conveyed by a debtor in fraud
of his creditors. (See Uniform Fraudulent Conveyance Act.—Acts &
Resolves 1924, Ch. 147.
Replevin Actions are the forms of actions at law by which a party
can obtain possession of specific goods or chattels unlawfully taken
or wrongfully detained from the rightful owner or person who is
entitled to its possession. Before the replevin writ can be served,
or before the delivery of the property to the plaintiff, a bond for double
the value of the property to be replevied must be delivered to the officer
before he will proceed to act under the writ.
Sales of Personal Property. Uniform Sales Act adopted in
1908, is now Gen. Laws ch. 106. There is a Bills of Lading statute.
(Gen. Laws ch. 108), and Gen. Laws ch. 105 relates to warehouse
receipts. As to sales of $500 or over, see Frauds, Statute of. Sales
of merchandise in bulk are fraudulent unless the provisions of Gen
Lawsch. 106, sec. 1, are complied with. Delivery of a bill of sale is not
constructive delivery of the goods. Delivery of possession of goods
sold is essential as to third persons without notice who purchase same
goods for value, or as to attaching creditors without notice. Vendor’s
retention of possession after sale is prima facie evidence of fraud.
As to conditional sales, see that topic supra.
Statutes. General revision and consolidation of statutes, effective
January 1, 1921 under title of General Laws.
Stock Transfer. This subject is covered by Stock Transfer Act
as codified in General Laws.
Suits. Civil actions in general, except those concerning land (if
one of the parties lives in the State), mast be brought in the county
where one of them lives or has his usual place of business. But in
lower courts venue depends on residence or place of business of defen­
dant. Where all parties are non-resident, action may be brought in
any county. Attachment of property owned by defendants residing
out of State may be made sufficient to give jurisdiction for a special
Judgment in suit after notice published by order of court. Such notice
to be given within one year from the entry of the suit. Persons commorant in State may also he arrested on mense process and held to
bail. A non-resident plaintiff is usually required to furnish indorser
for costs. See also Actions, supra.
Taxes assessed upon land shall with all incidental charges and fees
be a lien thereon from April 1st in the year of assessment. Such lienshall terminate at the expiration of two years from October 1st in said
year, if the estate has in the meantime been alienated and the in­
strument alienating the same has been recorded, otherwise it shall
continue until a recorded alienation thereof; but if while such lien is
In force a tax sale or taking has been made and the deed or instrument
of taking has been duly recorded within thirty days, but the sale or
taking is invalid by reason of any error or irregularity in the pro­
ceedings subsequent to the assessment, the lien shall continue for
ninety days after a release, notice or disclaimer, has been duly recorded,
or for ninety days after the sale or taking has been finally adjudged
Invalid by a court of competent jurisdiction. There shall be no lien
for taxes reassessed if the property is alienated before the reassessment.
Said taxes if unpaid for fourteen days after demand therefor, may,
with said charges and fees, be levied by sale of the real estate if the
lien thereon has not terminated.
The matter of enforcing the payment or collection, of taxes Is one
concerning which there is a considerable body of statute law which
cannot be briefly summarized.
Trustee Process. All personal actions except replevin, and actions
of tort for malicious prosecution, slander, libel, or assault and battery
may be begun by trustee process and goods, effects, or credits of
defendant iD hand of a third person may be attached and held to
satisfy final judgment. See also Actions, supra.
Warehouseman and Warehouse Receipts. The Warehouse
Receipts Act as codified into Gen. Laws is in force.
Wills. Every person of full age and sound mind Including married
women may make a will Will must be signed by testator, or by some
person in his behalf, by his express direction, and be attested and
subscribed by three or more competent witnesses in his presence. A
will executed in mode prescribed by the law either of place where
will Is executed or of place of testator’s domicil, shall be deemed
legally executed and shall be of same force and effect as if executed
in mode prescribed by laws of Massachusetts provided will is in writing
and subscribed by testator. As to waiver of provisions of will by
husband or wife, see Descent and Distribution, supra, also General
Laws ch 190. section 15
•
A will may be revoked by statute in the identical manner in which
the statute requires a will to be revoked. Will may be revoked by
destruction such as burning, tearing, cancelling, or by obliterating it
with a manifest intention to revoke the same, and it may be revoked
by a formal written instrument, by a later will or by a codicil.
Ordinarily marriage operates by statute as a revocation of a will
unless the will was made in contemplation of the coming marriage.
Witnesses. Any person, although a party, may testify in any
proceedings, except that neither husband nor wife may testify to
private conversations with each other, or be compelled to testify in
a criminal proceeding against the other. The defendant in a criminal
proceeding may testify, at his own request and not otherwise, and
once he takes the witness stand in a criminal proceeding or matter,
he waives all his privileges where the desired testimony tends to
incriminate him, and the privilege not to give testimony has been
waived.
The neglect or deliberate refusal of a defendant to take the stand
and testify in his own behalf shall not be a presumption against him.

2190

BANKING AND COMMERCIAL LAWS—MICHIGAN

and the prosecution shall not comment to the jury upon the defendant’s
failure to take the stand.
However, where the wife is necessary to explain certain acts, or
omissions in a criminal matter against her husband, if she refuses to
take the stand in his defence, the district attorney is not barred from
commenting to the jury as to why she failed to testify for and behalf
of her husband.
The communications of a client to his attorney as a legal adviser
are privileged and is a personal privilege belonging to the client. The
attorney over the objection of his client cannot take the stand and
testify as to private conversations disclosed to him as an authority
on the laws of the Commonwealth. However, if the client takes the
stand, he may be interrogated as to what he told his lawyer, pro­
vided such evidence is within logical sequence of the rules of evidence
generally.

SYNOPSIS OF

THE LAWS OF MICHIGAN
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Henby Wunsch and Edward F. Wdnsoh. 706-710 Dime
Bank Bldg., Attorneys at Law, Detroit, Michigan.
(See Card in Attorneys' List.)
Acknowledgments of real estate instruments may be before one
of the following officers: 1. Within this State: Any judge, clerk
or commissioner of any court of record, notary public, Justice of the
peace or master in chancery. The official should certify that “On
this day before me personally appeared.................... , to me known
to be the person or persons who executed the foregoing instrument
and acknowledged that he (or they) executed the same as his (or
their) free act and deed.” Notary’s certificate must show date of
expiration commission. Such instruments must have two subscribing
witnesses. 2. In any other state, territory, or district of the United
States: Same officials as described above or any officer authorized
by the laws of such state, territory, or district, or before a com­
missioner appointed by the Governor or this State for that purpose.
Any such instrument mav be executed according to the laws or any
such other state or territory. If officer has no seal, certificate of the
Clerk of the county or district, or of the Secretary of State within
which taken shall be attached. 3. In any foreign country: notary
public, or minister plenipotentiary, minister extraordinary, minister
resident, charge d’affairs, or commissioner or consul of the United
States, appointed to reside therein.
Actions. Common law forms of pleadings are used, but in some
respects modified by statute. Non-resident plaintiffs must give
security for costs.
Administration of Estates: In probate court of each county.
Claims are passed on by judge of probate or commissioners appointed
for each estate; within such time allowed by the court, not exceeding
in first instance one year nor less than four months; may be extended
not to exceed two years from date; the court may revive commis­
sion any time before estate is closed and allow further time three
months to examine any claim; an appeal to circuit courts from allow­
ance or disallowance of any claim. All claims barred, not presented
before administration Is closed:—
Administration of intestate estates is granted: 1st, to surviv­
ing husband or wife, or kin or grantee, or such one of them as judge
may appoint, or as they may request. 2nd, to one or more of the
principal creditors. 3rd, to such other person as the judge may think
proper. Non-resident administrators and executors appointed in
other states, territories, or foreign countries cannot sue as such in
this State without procuring administration in this State.
Affidavits may be taken by any judge, master in chancery, clerk
of court, justice of the peace, police magistrate, notary public, or
circuit court commissioner. Any oath authorized, or required to be
made, without the State for use in judicial proceedings here, must be
authenticated by judge of a court having a seal, and the genuineness
of such judge’s signature, existence of the court, and that such judge
is a member thereof, certified Dy the clerk of the court under the seal
thereof. If in any other state or territory, may be taken before a
commissioner appointed by the governor of this State, or any notary
public or justice of the peace authorized by the laws of any such state
or territory to administer oaths therein.
In actions at law affidavits of amount due on open and stated
accounts, attached to and served with process as commencement of
suit make a prima facie case, unless denied by the defendant’s affidavit
filed and served with plea.
Allens. May inherit or purchase and hold and convey personal
and real estate.
Arbitration. Competent parties to any controversy which Is or
might be the subject of an action at law or suit in equity, may agree
to arbitrate, and judgment of any circuit court rendered upon the
award. No arbitration of claim of any person to any estate in fee
or for life in real estate.
Arrest. By writ of capias In personal actions in tort and in actions
for money collected by any public officer; or upon promise to marry;
also by warrant allowed by any justice of the peace or judge of a
court of record, under the fraudulent debtor’s act, when the creditor
has commenced suit or obtained judgment and the debtor has disposed
of or concealed, or is about to dispose of or conceal property liable to
execution or the debt was fraudulently contracted.
Assignments for the benefit of creditors are void unless made
without preferences; must comprise all of assignor’s property not
exempt from execution. The circuit court in chancery has super­
visory Jurisdiction of such assignments.
Attachments. Writs may be issued from justice and circuit courts
on affidavit showing: debt due on express or implied contract, and
either that the debtor has absconded or is about to abscond from
the State or haws assigned or disposed of or is about to assign and
dispose of his property with intent to defraud his creditors; or is a
nonresident or the state, or a foreign corporation. May issue from
the circuit court for debt not due but to become due, upon satis­
factory showing to the circuit judge, but in such cases judgment can­
not be taken until debt is due. May issue in actions of tort against
non-residents in certain cases.
Bank Collection Code. Given directly following Laws.
Banks. Incorporation of: Any number of persons not less than
five may associate to establish for a period not to exceed thirty years,
commercial banks, savings banks, and banks having for both classes.
Capital required is graded—$20,000 to $250,000, according to popula­
tion of cities or villages where conducted. Upon filing articles of asso­
ciation, commissioner of banking department and Secretary of State
issue certificates of organization; board of directors chosen by the
stockholders. No more than the legal rate of interest in advance
shall be received; file correct list of stockholders with commissioner
of banking, and county clerk and report four times a year to be pub­
lished in newspaper where bank is conducted. Commercial loans,
not to exceed 50 per cent of the capital, on real estate securities, by
two-thirds vote of directors, except to secure debts due the bank.


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Federal Reserve Bank of St. Louis

Savings deposits payable as directors prescribe; commercial deposits
ayable on demand
Banks combining commercial and savings
eposits cannot issue post notes nor any bill or note or certificate as
money. Savings depositors preferred in distribution of savings
department funds. Stockholders individually liable equally and
ratably and not one for another to the amount of the par value of
stock, for the benefit of depositors. All transfers of property, and
payments of money after actual or contemplated insolvency to pre­
vent legal application of assets null and void; total liabilities of any
borrower shall not exceed one-tenth part of the whole capital and
surplus, may be increased to one-fifth by two-thirds vote of directors;
not to issue certificates of deposit for borrowed money nor make
partial payments on such certificates; not liable to depositors for pay­
ment of a forged or raised check unless notified within three months
after return of voucher.
All shares of bank stock shall be assessed against their owners in
the township, village, or city, where the bank is located, taxes not
paid by stockholders, bank’s duty to pay.
Trust deposits and security companies may be incorporated under
the general laws of the State applicable thereto. Seven or more
persons mav associate to establish—capital graded from $100,000 to
$5,000,000 according to population of cities where conducted, deposit
with the state treasurer 50 per cent of the capital stock in bonds
or real estate mortgages worth double the amount secured; powers
such as are customary for trust companies. They can do any banking
business.
Blue Sky Law. Michigan in 1915 passed an act, commonly known
as the Blue Sky Law. regulating the selling of and dealing in stocks,
bonds and other securities with certain exceptions of corporations,
associations, partnerships and individuals, so as to prevent fraud in
such dealings, and creating a Commission of three to administer the
provision of the law. Under this law application must be made to
the Michigan Securities Commission and the approval of the Com­
mission secured before such securities may be sold. Certain penalties
are imposed under the law for non-compliance with its provision.
The Michigan Supreme Court has declared the act to be Constitutional
and valid
Collaterals. Stocks, bonds or other personal property pledged
as collateral security for payment of money or the performance of
any obligation, upon default may be sold at public (or private sale
If so authorized by the contract) to satisfy the debt; but before public
sale, ten days notice must be given and served on pledger or legal
representative personally or by mail; such sale must be between
nine o’clock forenoon and sunset, at a public place in the township,
citv or village where held.
Collections. Uniform Bank Collection Code as recommended by
American Bankers Association, see page 2333.
Conditional Sales. Are valid Detween the parties: if consignee
or purchaser, on condition title is retained bv seller, is authorized by
the contract to sell, all sucn sales are valid. The consignee or pur­
chaser cannot make valid sales against the legal owner without the
authority of consignor or legal owner. (See Liens.) (See Frauds.)
Convevances. Any person of full age or otherwise capable may
convey by deed any interest in lands, whether in actual possession
or not. All grants and devises of lands to two or more persons create
estates In common; no joint tenancy, unless expressly so declared,
except such as are made in trust or to executors, and except such as
are made to husband and wife, who take as “tenants by entirety."
The words “conveys and warrants" in the deed describing the premises
and specifying the consideration, dated, duly signed and acknowledged
by grantor are sufficient to convey title in fee simple and to warrant,
that grantor and his heirs and personal representatives is seized of
the premises, has good right to convey same, guarantees quiet pos­
session thereof, and that he will warrant and defend the title against
all lawful claims. The words “conveys and quit claims" duly signed,
sealed and acknowledged by grantor are sufficient to convey grantor's
interest. The words “mortgages and warrants" and duly described
premises, specifying “to secure the payment” and reciting the sum
for which mortgage is given and the notes and other evidences of
debt secured thereby, mortgage being dated, signed, sealed and
acknowledged by grantor, is sufficient and warrants perfect title in
the grantor and against all previous incumbrances; omitting the
word “warrants" sufficient, but without any warranty. Dower and
homestead rights not waived unless wife joins in the mortgage. No
homestead right will avail against the mortgagee if there is no wife,
nor if wife joins in the mortgage. Married women of full age joining
with husbands in any deed, mortgage, power of attorney or other
writing, shall be bound in respect to their own title.
Corporations. Banks, mining, manufacturing. Insurance—fire,
marine, accident, burglary—printing and publishing, manufacturing
and mercantile, or a union of the two, partnership associations, real
estate associations, real estate, railroads, street railways, co-operative
benefit associations, co-operative savings associations, and religious
societies, are respectively organized under State general laws; required
to file with the secretary of state, articles of association.
Business Corporations. Three or more persons may organize.
One half of capital must be actually subscribed and at least 10 per
cent either in money or property must be paid in; if in property same
must be for the purpose of the business, and described and its value
specified in the articles. Stockholders vote in person or by proxy.
Each share has as many votes for directors as directory numbers,
and the aggregate vote may be distributed for one or more of direc­
tors. May issue preferred and common stock of the par value of
$10 or $100, and also non-par common stock. Preferred entitled to
dividend not to exceed 8 per cent quarterly, semi-annually or annually
and if not paid be accumulated, and paia. before any dividend paid on
the common. Articles of association to be recorded in the county
clerk's office of county where operations carried on, and office of the
secretary of state. May hold real estate for the purpose of the cor­
poration and such as acquired as security or in payment of debts,
managed by not less than three directors chosen by the stockholders
annually hold office until successors are chosen; make duplicate reports
in January or February annually for the fiscal year last ending, of the
financial condition and property of the corporation to secretary of
state, stockholders are liable for labor debts; they make all by-laws for
corporation. Foreign corporations organized under the laws of any
other state of the United States or of any foreign country, unlawful
to carry on business in this state until certificate of authority procured
from secretary of State; not capable of making valid contracts in this
state until authorized to carry on business; unlawful for any person to
act as agent of until authorized to do business. Sales of goods or
merchandise by the right of inter-state commerce not affected by
state laws.
Courts. Terms of Jurisdiction. Circuit courts, holding two
or more terms annually in each county, have original jurisdiction in
all cases of law and equity wherein the amount in controversy is $100
and upwards; and have appellate jurisdiction from justice of the
peace probate courts, and other inferior tribunals. Justice courts in
each county have jurisdiction of cases at law involving from $100 to
$500. In Detroit this court is now known as the Common Pleas
Court. In Grand Rapids is a “Superior Court" for civil cases,
limited to parties resident of the city. Probate courts in each county
have jurisdiction of estates of deceased persons and testamentary
trusts. Supreme court has final appellate jurisdiction from circuit,
municipal and recorders’ courts.
Days of Grace. Abolished.
Depositions. Testimony of any witness without the State of
more than fifty miles from the court may be taken de bene esse,
before any judge of any state or of the United States, or of any foreign
country, or before any circuit court commissioner in this or any other
state, or of the United States, or any commissioner of this State, any
consul or consular officer, justice of the peace officer, or notary public
authorized to administer oaths in the state or county where taken
and not interested as attorney or counsel or in the event of the cause;

BANKING AND COMMERCIAL LAWS—MICHIGAN
reasonable notice given in writing by party or his attorney proposing
to take to opposite party or his attorney of record, stating names of
witnesses, time and place of taking and official before whom to be
taken. Commissions to take depositions of any witnesses may be
issued by circuit court wherein the suit is pending or by the judge or
register thereof, or by a justice of the peace in a suit before him on
written interrogatives. Fees for taking, certifying, sealing and for­
warding $2; for each 100 words in deposition ten cents and copies
three cents. Each party pays for his own examination or cross
examination in the first Instance.
Descent. Real estate and personal property of intestate after
payment of debts and administration expenses and allowances as
follows:
Real Property. One-third to widow, remaining two-thirds to his
Issue; if no widow the whole to his issue to share equally if of same
degree of kindred to intestate, otherwise by representation; if no
issue, husband or widow to the father and mother in equai shares,
if only one living to the survivor alone. If surviving husband or
widow and no issue, one-half to such survivor, remainder to father
and mother or their survivor. If no issue or parents, husbands or
widow, equally to brothers and sisters and the children of deceased
brothers and sisters; if none such relatives, to next of his kin in equal
degree through nearest ancestor: if anv unmarried child dies under
age, his or her inheritance from any parent, to other surviving children
of same parent and their issue by representation. If husband or wife
survive and no issue, parents, brothers or sisters, or their children to
husband or wife, and if no foregoing relatives whomsoever estate
escheats to State. Illegitimates heir to mother; dying intestate
estate descends to mother or her relatives if she be dead; become
legitimate by parents, intermarriage or father’s written acknowlment. The foregoing provisions for the widow are in lieu of dower
and homestead right unless one year after administration granted
she applies for assignment of dower and homestead in which case
her interest in deceased husband’s lands is limited to the dower and
homestead right and the residue shall descend as above provided for
that portion not taken by her.
Personal Estate. Residue — one-third to widow, two-thirds to
children or issue by representation; one child; one half to child and
one-half to widow; no widow or child, to all lineal descendants equally
If widow and no children or issue, to widow, not exceeding $3,000;
estate excess of that, one-half excess to widow, other half to surviving
parents, and if none such to brothers or sisters; and none such, all
such excess to widow. Married women intestate, one-third to hus­
band. two-thirds to her children or their issue by representation,
only one child or issue of deceased child; to husband and such child
equally; if no child or issue of deceased child, one-half to husband
and other half to surviving parents, and if none, to brothers or sisters
or issue of them and if none, all to husband. In any other case same
as for real property. Estates by curtesy abolished.
Dower. Wife entitled to use of one-third part of all lands owned
by her husband as estate of inheritance any time during marriage.
No dower as against mortgages for purchase price, or mortgages made
before marriage, except in surplus. Must exercise option to take
dower in lieu of rights under will or statute within one year after
administration; residing in this State and eighteen years of age and
upwards may bar by joining in husband's conveyances and mort­
gages or by deed alone to one who has husband’s title, intent to bar
being expressed; or by jointure secured as bar.
Execution. May issue to any county at once, unless stayed after
judgment in circuit court, in justice courts, expiration of five days;
not liens on real estate or personal property until levy by proper
officer. Real estate is sold without appraisement to the highest
bidder, except homestead, to determine excess of value above $1,500
redemption claim. Defendant or his heirs or assigns may redeem
within twelve months, his judgment creditors and others having valid
Hens within fifteen months from date of sale. Execution against the
body may be issued on all judgments in actions of tort. Personal
property levied on, after setting off exemptions, may be sold on six
days’ notice at public sale, to highest bidder to a sufficient amount to
satisfy the debt and costs; no redemption after such sales. Execu­
tions from justice courts do not run against real estate.
Exemptions. Homestead—selected by the owner and occupied
by him; not exceeding forty acres of land and dwelling thereon; or one
lot with dwelling thereon within any recorded town plat or city or
village not exceeding In value $1,500. Same cannot be alienated or
incumbered without consent of wife or sold on any execution or any
other final process from any court, unless appraised to exceed the
value of $1,500 and that amount is paid or realized on sale under
such process. Exemption of homestead continues during its occupa­
tion by the widow or minor children of deceased person who when
living occupied the same.
Fraud. Criminal fraud—obtaining the signature of any person
Arm, or corporation with intent to defraud. Fraudulently issuing or
selling or duplicating and disposing of any stock, scrip, or evidence of
debt of any bank or other incorporated company of this State; issue
of any false receipts by warehousemen, merchants, or their agents—
receipt; or to wrongfully dispose of or convert property to their own
use after issuing receipt; wrongfully removing or disposing of any
personal property by any agent delivered upon written agreement or
Instructions; wrongfully to dispose of property covered by chattel
mortgage by mortgagors or of property held by contract of purchase
without legal title by such purchaser or of property held under any
lease by lessor. For any officer or stockholder of any bank or any
other person for such bank; to sign, issue or knowingly put in circula­
tion any note or bill of any such bank, before the capital stock is
paid in, or before the president and directors thereof have complied
with the law; for any officer or agent of any bank knowing such bank
to be insolvent or in contemplation of insolvency, or for any assignee
of the property of such bank to sell or dispose of any money or property
of such bank with intent to defraud, delay or hinder creditors thereof,
or for any agent or person to fraudulently obtain or dispose of any
money belonging to any insurance company organized in this State.
Frauds—Statute of. No executor or administrator is liable on
any special promise to answer damages out of his own estates.
Fraud, Civil. Sales, transfers, and assignments of stocks of goods,
wares, merchandise, and fixtures in bulk, pertaining to conduct of any
business, otherwise than in ordinary course of trade of seller, etc.,
void as against creditors, unless the seller, etc., five days before sale,
make Inventory of the goods and cost price to seller of each article
and unless the purchaser demands from seller list of names and
addresses of creditors and his indebtedness, and within five days
before taking possession and payment notifies every creditor of such
sale.
Garnishment. Process may issue in any action brought in any
Justice court or circuit court on contract expressed or implied, judg­
ment or decree, to hold whatever property any person may own or
have belonging to the debtor. Bills of exchange and promissory
notes due in the garnishee’s hands at the time of serving summons
are garnishable. Property, real, or personal, things in action, equitable
Interests, held by fraudulent transfer from the debtor and any prop­
erty liable to execution or to the payment of the debts of the debtor
In the garnishee’s hands may be recovered; wages of any householder
not more than $30 and less then $8 for his personal labor, and of any
other person for labor not more than $15 and not less than $4; wages
cannot be garnished until after judgment has been given against
debtor; and benefits payable by fraternal beneficiary societies, shares
in building and loan association of any debtor, except as to one having
a homestead exemption, are exempt from garnishment.
Holidays. (Legal) January 1st, February 12th, February 22d,
May 30th, July 4th, first Monday in September, Thanksgiving Day
as specified by the Governor of State, December 25th; every Saturday
from 12 o’clock noon to 12 o’clock midnight, all National. State.


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2191

County, or City election days. When Christmas or any similar hoUday
falls on Sunday, the following Monday the legal holiday.
Husband and Wife. If sued together she may defend and If
either neglect to defend the other may be ordered to defend for both.
If he deserts her she may be authorized by the probate court to prose­
cute or defend in his name. If either wrongfully retains the other’s
property, acquired before or after marriage, the owner may sue for
same as if unmarried. Neither liable for the debts of the other before
marriage, nor earnings or property of either nor the income thereof,
nor shall either be liable to make compensation for labor or services
rendered for the other. Husband is liable after marriage for family
expenses, and for debts incurred by the wife with his express or
Implied authority. Either may constitute the other an attorney in
fact to dispose of property. Expenses of family and children's edu­
cation are not chargeable upon the property of the wife but are
chargeable against the husband and he may be sued therefor.
Interest. Legal rate 5 per cent but by written agreement may be
charged not to exceed 7 per cent. Forfeiture of all interest is penalty
for usury. When any installment of Interest upon any note, bond,
mortgage or other written contract shall become due and remains
unpaid, interest is allowed on such installment from the time It became
due at same rate specified in the obligation or at the legal rate. Legal
rate collectable on all moneys due on any written obligations and on
all moneys due on all contracts express or implied, whether verbal
or written; and on settlement of accounts from day of ascertaining
balance due; and on judgments from day of entry; and on verdicts of
Jury from date to date of entry of judgments thereon. In computing
time of interest and discount on negotiable paper, a month means
a calendar month and a year a calendar year of twelve months.
Judgments of courts of record are not Hens on real estate or
personal property until by levy thereon of execution issued from the
courts upon such judgments. Liens under execution levied upon
real estate exist five years from and after the levy. Judgments expire
by limitation in ten years from date of entering in courts of record
and six years In justice courts, and cannot be renewed except by action
at law thereon before expiration. Judgments of the justice of the
peace may be entered in the circuit courts on transcript duly taken
to the circuit court and thereupon become judgments of such circuit
courts.
Liens. Any person, who pursuant to a contract with any owner,
part owner or leasee of any land, furnishes labor or materials in the
construction of a building, etc., on such land, shall have a lien on such
structure and land to the extent of one quarter section or if in a city
or village, the lot or lots upon which such structure is situated. And
any sub-contractor, who furnishes materials or labor in carrying fore­
ward or completing such contract shall have a lien upon such building
and land to the extent of the interest of such owner, etc. Any person,
artisan, or tradesman for labor and skill applied upon any property
delivered for that purpose shall have a prior lien for amount due for
such labor. Hotels, boarding houses and lodging houses have a lien
upon baggage and other valuables of guests, boarders or lodger for
accommodations. Any person keeping and caring for domestic ani­
mals intrusted to them for that purpose have a lien for proper charges.
Limitation of Suits. Judgments of courts of record ten years,
justice court judgments six years; accounts and notes and other
simple contracts and for taking, detaining or injuring goods and
chattels, six years from the date the action accrued; revivor; part
payment, or promise in writing to pay. Absences from the State
deducted from the period of limitation. Mortgages fifteen years
after due or after last payment thereon. For trespasses on lands,
assault and battery, false imprisonment, slanderous words or libels
and mal-practice against physicians, surgeons, and dentists, two
years. For misconduct of sheriff or their deputies, three years, and
for personal injuries three years. For the recovery of real property,
five years where the claim arises against executors, guardian’s or
sheriff’s deed; five years where tne defendant claims and is in pos­
session of lands under deed made by auditor general of this State for
taxes; and by minors and others under legal disabilities three years
after removal of such disabilities; in all other cases fifteen years.
Limited Partnerships. May consist of one or more general and
one or more special partners. Specials contribute specific amount
of capital in cash or property at cash value, and if actually paid in
not liable for firm’s debts in excess of such special capital. General
partners transact the business of the firm.
Married Women. May make contracts In respect to their own
property and may hold and enjoy, and have the same rights and
remedies regarding their property as if unmarried. They may carry
on business in their own names with their own property by consent
of their husbands; cannot enter into partnership with husband or
any other person and become liable for the firm contracts. Married
women’s contracts to pay or to become liable for debts of husbands or
other person voidable, may however charge their real estate or per­
sonal property to secure such indebtedness by deed, mortgage or
contract. Married women are entitled to have and to hold their
earnings made by their own personal effort, and may make any con­
tracts relative thereto.
Mortgages on real estate, executed and acknowledged the same
as deeds; may be foreclosed under power of sale by advertisement
or in circuit court in chancery of the county wherein the property
is situated. Trust deeds not in customary use but may be made and
executed and will be treated as mortgages.
Chattel mortgages and bills of sale; intended as security by mort­
gagor, signed and delivered to the mortgagee, sufficient between the
arties, but void as to creditors, subsequent purchasers and encumrancers in good faith and without notice, unless such mortgages and
bills of sale or true copies are filed In the city or township clerk’s office
where mortgagor resides, or if non-resident of State, in city or town­
ship where the property is situated; and unless affidavit of mortgagor
or of some one for him having knowledge of the facts is annexed to
the mortgage or bill of sale, showing consideration is actual and
adequate and in good faith. Without such affidavit officers forbade
to receive and file such mortgages; cease to be valid against creditors,
subsequent purchasers, and encumbrancers in good faith, on expira­
tion of year from filing date, unless renewed within thirty days next
preceding expiration by affidavit of mortgagee showing his interest,
etc., filed and annexed to the mortgage in said clerk’s office; likewise
each succeeding year while the mortgage exists.
Negotiable Instruments. A promissory note is an unconditional
promise in writing to pay a sum certain in money, on demand, or at
a fixed and determinate future time, to the order of a specified person
or to bearer.
A bill of exchange is an unconditional order of one person to another
requiring the drawee to pay to a certain person, or order, or bearer on
demand or at a fixed or determinate future time a certain sum of
money. May be payable in installments and contain provisions that
on default the whole sum of money shall become due with exchange,
fixed or current rate, interest and attorney’s fees for collection. May
authorize sale of collaterals and confession of judgments. If it read’s
“I promise to pay," all makers are Jointly and severally liable. Must
not be payable upon contingency. Cannot waive exemption from
txecution. Need not specify “for value received" nor place where
drawn or payable. If issued, accepted, or indorsed, when over
due Is payable on demand. May be payable to two or more payees
jointly or one or more of several payees. Want or failure of con­
sideration, a defense against one not a holder in due course, partial
failure a defense pro-tanto. One not a party, or the payee of the
paper placing a signature in blank on the paper before delivery becomes
an endorser. Indorser engages on due presentment the paper shall
be honored and that he will pay to holder or any subsequent Indorser,
who may be compelled to pay; where maturity falls on Sunday or on
a holiday, payment due on the next business day; but where all of such
day not a holiday may if payable on demand be presented before noon.

2192

BANKING AND COMMERCIAL LAWS—MINNESOTA

Fraud in procuring signatures and delivery defense against any
holder.
Presentment not necessary to charge anyone primarily liable. If
not payable on demand present on the day due; if on demand present
within a reasonable time after issue; bill of exchange payable on
demand present reasonable time after last negotiation.
Fraudulent or material alterations do not affect the original instru­
ments in the hands of innocent holder in due course.
Unconditional promise in writing to accept a bill of exchange,
given before or after drawn, valid in favor of all who take it upon
faith thereof for value; holder may decline qualified acceptance; if
he takes qualified acceptance, drawers and indorsers are discharged.
Protest of foreign bills of exchange may be made by a notary public
or any respectable resident of the place of payment in the presence of
two or more creditable witnesses; drawee is not liable unless he accepts.
Check or a bill of exchange on a bank payable on demand, must be
presented reasonable time after issue, and if dishonored notice must
be given or drawer is discharged to extent of loss caused; does not
operate to assign any part of drawer’s funds; bank is not liable unless
It accepts or certifies. If holder has check certified drawers and
Indorsers are discharged.
The present negotiable Instruments law of Michigan took effect
Sept. 16 1905 and repeals all acts or parts of acts inconsistent with
Its provisions; but does not apply to instruments made prior thereto;
materially changes the law in this State and should receive special
examination in every doubtful case.
Power of Attorney. Almost every act that any person, firm or
corporation may perform, may be performed by an attorney in fact.
Conveyances, mortgages, or leases for more than three years' term
by attorney in fact, the power of attorney must be in writing signed,
sealed and acknowledged same as a deed of lands, to be admitted for
record or to proof thereof.
Probate Law. (See Administration of Estates.)
Protest. (See Negotiable Instruments.)
Replevin. Goods or chattels wrongfully taken or detained may
be replevined by owner or part owner or party entitled to possession.
Affidavit of plaintiff or agent necessary for issue of writ. If from
circuit courts plaintiff required to give bond with sufficient sureties
to the officer within twenty-four hours after seizure and appraisal of
the property which must not be delivered to plaintiff within fortyeight hours; and in the meantime if the defendant shall give sufficient
bond to the officer he shall return the property to the same person
from whom he took it; in that case if plaintiff recovers he may recover
on the defendant’s bond; if he fails defendant may recover on plain­
tiff’s bond according as the judgment may warrant. In justice courts
bond with sufficient sureties must be given and filed in double value
of the property before writ issues.
Taxes. State and county payable every year after December 1st,
delivered to couDty treasurer March 1st, thereafter and if delinquent
bear interest 1 per cent per month. Returned to auditor general of
State, if not paid, and by him enforced by foreclosure in chancery in
every county, and the taxable property sold under decree of the
court by county treasurer each parcel for the amount of taxes and
charges against same; redeemable one year thereafter and does not
become absolute until proceedings taken by purchaser or writ of
assistance, which must be instituted within five years by service of
written notice upon owners six months before application for such
writ. If decree regular and property taxable, and due notice is given
and served, purchaser is entitled, upon due proof thereof to writ of
assistance and possession unless redeemed pending the notice by
payment of double the amount paid by purchaser and $5.00 for each
parcel redeemed. City taxes are governed by charter or by the
general act under which cities and villages are organized
Wills. Codicils. Every person of full age (twenty-one years) and
of sound mind mav make; must be in writing, signed bv testator or by
Borne person in his or her presence duly authorized by him or her and
attested and subscribed in his or her presence by two or more witnesses
competent as such at the time. If one of the subscribing witnesses
shall testify to the execution of the will in all particulars and testa­
tor was of sound mind at the time will was made, the court may
admit the will, in case no person appears to contest it. if none of
the witnesses reside in the State at the time of proving the will, the
court may admit the testimony of other witnesses to prove testator’s
sanity and execution and proof of the signature of testator and sub­
scribing witnesses. Probate of will conclusive of its due execution
and cannot be assailed collaterally. Foreign wills, duly admitted to
probate without the State, may be admitted and recorded in any
county of the State in which testator left real or personal estate by
duly filing, an exemplified copy of said will and of the record admitting
same to probate. A nuncupative will in which the value of the estate
bequeathed does not exceed $300, duly proved by two witnesses, may
be allowed. Wills may be revoked by burning tearing, cancelling,
or obliterating with intention of revoking same by testator or by some
other writing signed, attested, and subscribed in the manner provided
for execution of wills but shall prevent revocation implied by law.

SYNOPSIS OF

THE LAWS OF MINNESOTA
RELATING TO

BANKING AND COMMERCIAL USAGES
Revised by Oppenheimer. Dickson, Hodgson Brown A Donnellt
Attorneys at Law, Merchants National Bank Bldg., St. Paul.
(See Card in Attorneys’ List.)
Acknowledgments may be certified by the following officers:
I. W’ithin the State by a resident judge, clerk or deputy clerk of
any court of record therein. Secretary of State, a notary public j ustice
of the peace, town, city or village clerk, or recorder, court commissioner,
register of leeds. or county auditor, or their deputies, county commis­
sioner, or member of the legislature. 2. Out of the State but in the United
States by a judge of the supreme, circuit, or district courts of the
United States, or of any court of record of any state, territory, or dis­
trict. the clerk or a deputy clerk of any such court, a notary, a justice
of the peace, or any commissioner appointed by the governor of this
State for that purpose 3. In foreign countiies by a notary public,
or by any minister, charge d'affaires, commissioner, consul, commercial
agent or other consular or diplomatic officer of the United States
appointed to reside in such country, and deputies or other represen­
tatives of such officers. The form of the certificate may be, “On
this.................... day of........................... 19......... before me personally
appeared.........................to me known to be the person described in,
and who executed the foregoing instrument and acknowledged that
he executed the same as his free act and deed.” In case of corpora­
tion it may be, “On this.................... day of......................19. . . , before me
appeared A. B. to me personally known, who being by me duly sworn
did say that he is the president (or other officer) of (name of corpora­
tion), that the seal affixed to the foregoing instrument is the corporate
seal of said corporation and that said instrument was executed in
behalf of said corporation by authority of its board of directors, and
said A. B. acknowledged said instrument to be the free act and deed
of said corporation.” If made outside the State the impression of the
official seal of the certifying officer must be affixed, or there must be
attached the certificate of the clerk of a court of record of the county
or district in which it is made under his seal that the signature of the
certifying officer is genuine.


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Actions. The distinction between actions at law and suits in
equity is abolished. There is only one form of action. It is called
a civil action and must be prosecuted in the name of the real party
in interest except that executors, administrators, trustee of an express
trust and persons expressly authorized by statute may sue without
joining the person for whose benefit the suit is brought.
Administration of Estates. Estates of deceased persons are
administered in probate courts of which there is one in each county
presided over by the probate judge of the county.
In granting letters of administration preference is given: 1. To
the surviving spouse or next of kin or such suitable person as they
or either of them select. 2. If no application is made for thirty
days after death of intestate, to principal creditor or creditors, or
some person interested, and if deceased was native of foreign country
to the consul or other representative of that country residing in this
State, or to such competent and suitable person as he may select.
Upon granting letters the court makes an order limiting the time
within which creditors may present their claims. This time must
not be less than six or more than twelve months; but, may be extended
for good cause to a date not more than eighteen months after notice
given of the order. On proof by affidavit that there are no debts
the time limited may be three months. Notice of the order is given
by publication thereof once each week for three weeks in a newspaper
in the county. Claims not presented within time limited are barred.
Non-resident executors and administrators may sue in this State.
Allens. (See right to hold property.)
Arbitration. All controversies which can be the subject of a civil
action may be submitted to one or more arbitrators for decision,
except a claim to an estate in fee or for life in real estate.
Arrest. There is no arrest for debt.
Assignments. Statutes relating to assignments for the benefit of
creditors are in force except as affected by the U. S. Bankruptcy Act
of 1898.
Practically they may be said to be superseded by that act.
Attachment. Before allowing a writ of attachment, the court
must require of the plaintiff a bond in the sum of at least $250, and
an affidavit of the plaintiff, his agent or attorney. (1) That the debt
was fraudulently contracted or (2) the defendant is a foreign corpora­
tion or non-resident or (3) has departed from the State as he believes
with intent to defraud or delay his creditors, or to avoid the service of
a summons or keeps himself concealed therein with like intent or (4)
has assigned, secreted, or disposed of his property with intent to delay
or defraud his creditors or is about to do so.
Banks. Three or more persons may incorporate as a bank. They
must first secure from the State Securities Commission a certificate of
authorization, which is granted or denied after a hearing and intro­
duction of evidence. The capital required is at least $20,000 and a
surplus of at least $4,000 in a municipality not over 1,000 population,
and at least $25,000 and a surplus of at least $5,000 in one over
1,000 and not over 5,000, and at least $40,000 and a surplus of at
least $.8,000 in one over 5,000 and not over 100,000, and at least
$50,000 and a surplus of at least $10,000 in one over 100,000; pro­
vided, however, that the Securities Commission, in their discretion
may permit the organization of a bank with $10,000 capital and a
surplus of $2,000 in a municipality with a population of less than 500
wherein there is no bank. Capital and surplus must be paid in full
in cash, and certified to the Commissioner of Banks under oath of
the President and Cashier before it shall be authorized to commence
business. Stockholders are individually liable for debts of the bank in
an additional amount equal to the par value of the stock owned by
them and this liability continues one year after the transfer of the
stock. Surplus of 20% of the capi'al must be maintained unimpaired.
No State Bank or trust company shall pay interest on deposits at
a greater rate than four per cent per annum, provided that interest at
that rate per annum may be credited or paid on savings accounts
quarterly or semi-annually, and interest at that rate per annum may
be paid bn certificates of deposit not oftener than every six momhs;
and providing that any person or officer who knowingly or willfully
accepts deposits with an agreement on the part of the bank or trust
company to pay a larger rate of interest than as so provided shall be
guilty of a misdemeanor (See Laws of Minnesota for 19Z9, Chapter l hk)
Every bank must make to the commissioner of banks not less than
four reports each year which must be published. Liabilities to a hank
of any person, corporation or firm, for money borrowed, including
therein liabilities of the several members thereof, shall at no time
exceed 15 per cent of its capital and surplus. It must have a reserve
equal to one-fifth of all its matured or demandable liabilities, one-half
of which must be cash, and the remainder may be balances due from
solvent banks. In case of insolvency or violation of the banking laws,
the commissioner of banks may take possession, and apply to the
court for a receiver. Branch banks are prohibited
Bills of Lading. The Uniform Bills of Lading Act became effec­
tive June 1, 1917.
Initial Carrier receiving property for transportation between points
within the State, liable for loss, damage or injury caused by it or
other carrier en route, and all contrary provisions in Bill of Lading
void
Blue Sky Law. The commission is headed by the Commissioner
of Securities and includes a special deputy attorney general. The
law prohibits the selling by anyone of securities within the state until
such securities have been registered with the commission and until
the commission has granted permission to sell the same. Securities
are defined to include any stock, share, bond, note, debenture, com­
mercial paper, evidence of indebtedness, investment contract, interest
in or under a profit sharing or participating agreement or scheme,
any interest in or under any oil, gas or mining property or in any
property represented to contain or be a prospect for oil, gas or minerals,
beneficial interest in a trust or pretended trust or any interest in the
capital, assets, property or profits of any person.
The commission is given rather extensive powers to regulate the
selling price of securities and cost of promotion, to fix the conditions
under which a permit shall be granted to require the furnishing of
relevant information, and to suspend or annul existing permits.
The more important securities exempt under the act are: (1) Any
security issued or guaranteed by the United States or by any state,
territory or insular possession thereof, or by the District of Columbia,
or by any political subdi vision or agency of a state, territory or insular
possession having the power of taxation or assessment; (2) Any
security issued or guaranteed by any foreign government with which
the United States is at the time of the sale thereof maintaining diplo­
matic relations, or by any state, province or political subdivision
thereof having the power of taxation or assessment; (3) Any security
issued by and representing an interest in, or issued by and representing
a direct"obligation of. a state bank organized and operating under
the laws of Minnesota; and Any security issued by a national bank
or by a corporation or governmental agency created by Congress other
than those created under the code of laws for the District of Columbia or
for any territory or possession of the United States, provided such
corporation is subject to supervision or regulation by the United
States Government: (4) Certain securities issued or guaranteed by
railroads or public service utilities; (5) Securities listed on the New
York Stock Exchange, New York Curb Exchange, Boston Stock
Exchange, Board of Trade of the City of Chicago and Chicago Stock
Exchange which securities have been so listed pursuant to official
authorization by such exchange, and all securities senior to any
securities so listed, “subscription rights so listed,” or evidences of
indebtedness guaranteed by companies any stock of which is so listed,
such securities to be exempt only so long as such listing shall remain
in effect; (6) Commercial paper or negotiable promissory notes matur­
ing within six months from the date of issue: (7) Securities of certain
corporations organized for religious, educational and charitable pur­
poses, and not for pecuniary gain: (8) Policy contracts of insurance

BANKING AND COMMERCIAL LAWS—MINNESOTA
companies licensed to do business in the state: (9) Any security issued
by a building and loan association organized under the laws of this
state: (10) Securities of cooperative associations organized under the
laws of the state for agricultural, dairy or live stock purposes.
Certain sales are exempt, such as isolated sales; sales of notes
or bonds secured by a mortgage lien when the entire lien, together
with all notes or bonds secured thereby, is sold to a single purchaser
at a single sale; sales made under the order of court; stock dividends
or issuance of increase of stock to existing stockholders where no
commission is paid; sales to banks, savings institutions, trust com­
panies. insurance companies or licensed brokers.
Chattel Mortgages. Every mortgage of personal property which
is not accompanied by immediate delivery and followed by actual and
continued change of possession is void as to creditors and subsequent
purchasers and mortgagees in good faith, unless it is made in good
faith. attested by two witnesses, acknowledged and died with the
register of deeds of the county In which the mortgagor resided at
the time of its execution, is a resident of the State, or of that in which
the property was then situated if a non-resident. If the mortgagor
resides in St. Paul. Minneapolis or Duluth or is a non-resident and
the property is situated there, the mortgage must be died with the
city clerk of such city instead of the register of deeds of the county.
Duplicates or copies certided by any officer with whom the mortgage
has been properly died, may be died in other places wherein any part of
the property was situated when the same was made
As against
creditors of the mortgagor and subsequent purchasers and mortgagees
In good faith the lien does not continue beyond the term of six years
from the date of dling the mortgage unless the indebtedness is not
then due and payable by its terms, in which case it continues two years
after the maturity of the debt and no longer
Every mortgagee of a chattel mortgage shall at the time of its
delivery make and deliver to the mortgagor a full, true and complete
copy of such mortgage. No register of deeds nor city clerk is allowed
to receive or die any chattel mortgage which does not contain a
receipt of the signer of the mortgage to the effect that a copy of such
mortgage has been received by him.
Chattel mortgages given by a married man or woman on property
exempt from execution must be executed by both husband and wife
if living.
Conveyances. Deeds and mortgages of real estate must be exe­
cuted in the presence of two subscribing witnesses and to entitle them
to record must be acknowledged by the person executing the same.
Conveyances made out of the State, may be executed as above, or
according to the laws of the place of execution.
Corporations. May be organized by any number of persons, not
less than three, for the purpose of engaging in any lawful business.
The amount of capital stock shall in no case be less than $10,000,
divided into shares of not less than $1.00 or more than $100. The
Incorporators must sign and acknowledge a certificate specifying 1.
the name, general nature of business, and principal place of transacting
the same. 2. Period of its duration, if limited. 3. Names and places
of residence of incorporators. 4. In what board management is
vested, date of annual meeting at which such board shall be elected,
names and addresses of persons composing board until first election.
5. Amount of capital stock, how the same is to be paid, number of
shares and par values of each, and if more than one class, a descrip­
tion, and terms of issue and method of voting of each. 6. Highest
amount of indebtedness to which corporation shall be subject. This
certificate is filed with the secretary of state and with the register
of deeds of the county in which the principal place of business is
located and published in such county two successive days in a daily
newspaper, or two successive weeks in a weekly
Sec. 3. The Legislature shall have power from time to time to
provide for, limit and otherwise regulate the liability of stockholders
or members of corporations and co-operative corporations or associa­
tions, however organized. Provided every stockholder in a banking
or trust corporation or association shall be individually liable in an
amount equal to the amount of stock owned by him for all debts of
such corporation contracted prior to any transfer of such stock and such
individual liability shall continue for one year after any transfer of
such stock and the entry thereof on the books of the corporation or
association. The liability of stockholders of corporation as formerly
provided in the constitution has been abolished by constitutional
amendment and at the present time the liability applies only to the
stockholders in banks and trust companies.
Foreign Corporations. Every foreign corporation organized for
pecuniary profit before it can transact or continue business in this
State, acquire, hold or dispose of property or bring suit here must
appoint an agent residing in the State, authorized to accept service
of process, and must file with the secretary of state an authenticated
copy of such appointment and of its charter and a verified statement
showing the proportion of its capital stock represented by its property
and business in tnis State, and upon that it must pay a fee. This act
does not apply to exclusively manufacturing corporations, traveling
salesmen soliciting business for non-resident corporations, nor to those
engaged only in the business of loaning money or investing in securities,
nor to those organized to raise and improve live stock, cultivate farms,
can fruits or vegetables, nor to those whose sole business is transpor­
tation of freight or passengers by water.
Courts. District courts hold one or more terms a year In each
organized county, have original jurisdiction in all civil actions a» law
and in equity, and in all criminal cases where the punishment exceeds
three months’ imprisonment or a fine of more than $100.
The supreme court has appellate jurisdiction in all cases, but there
is no trial by jury in that court. It has original jurisdiction in such
remedial cases as are prescribed by law.
Probate courts have exclusive jurisdiction of matters connected
with the settlement of estates of deceased persons, minors, and insane
persons. Terms are held on the first Monday of each month in each
organized county.
Municipal courts exist in certain cities, and are courts of record with
limited jurisdiction in civil and criminal actions.
Justices of the peace have no jurisdiction in civil actions where the
amount involved exceeds $100.
Days of Grace are abolished.
Depositions may be taken at any place within or without the
State upon notice in writing, stating the reason for taking the same,
the time and place, and giving the opposite party one day for prepa­
ration. and one day for every 100 miles, exclusive of Sundays and
the day of service, before any officer authorized to administer oaths.
Oescent and Distribution of Property. Homestead descends
to surviving spouse for life, remainder to children and Issue of deceased
children. If no children or issue of deceased child, then to surviving
spouse in fee, exempt from debts not a valid charge thereon at time of
Intestate's death. After payment of debts and certain allowances to
the surviving spouse out of the personal property, the residue of the
estate descends as follows: 1. One-third to the surviving spouse,
balance in equal shares to children and lawful issue of deceased child
by right of representation. 2. If no surviving child or lawful issue
of deceased child the whole estate descends to surviving spouse if
any. 3. If no issue or surviving spouse, to father and mother in equal
shares, or if but one survive, to such survivor. 4. If no surviving
Issue, spouse, father or mother, in equal shares to brothers and sisters
and lawful issue of deceased brother or sister. 5. If no issue, spouse,
father, mother, brother, sister, or living issue of deceased brother
or sister, to next of kin, in equal degree, but those who claim through
nearest ancestor preferred to those claiming through ancestor more
remote. 6. If no spouse or kindred , to the State.
Dower is abolished.
Employer# Liability Act. Effective since April 24. 1913.
Executions issue from district courts any time within ten years
after judgment and may run to any county where judgment is docketed.


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2193

are returnable in sixty days and may be renewed for sixty days at a
time on request of judgment creditor or his attorney. Personal prop­
erty is sold on ten days posted notice; real estate on six weeks pub­
lished notice, and subject to redemption by judgment debtor, his as­
signees and creditors of a deceased mortgagor who have proved their
claims in probate court may redeem within one year from the date of
the foreclosure sale.
Exempt ions. Homestead outside of incorporated municipality
may include eighty acres. If in incorporated place containing less
than 5,000 inhabitants, its area shall not exceed one-half acre, and in
larger incorporated places one-third of an acre without regard to value.
Family pictures, library, musical instruments for use of family wear­
ing apparel, beds, stoves, cooking utensils used by family, other house­
hold furniture not exceeding $500 in value, three cows, ten swine, one
yoke of oxen, and a norse. or in lieu thereof, a span of horses or mules,
one hundred chickens, fifty turkeys, twenty sheep, the wool there­
from raw or manufactured, food for such stock for one year’s
supply, either provided or growing or both, one wagon, cart or
dray one sleigh two plows one drag, and other farming utensils.
Including tackle for teams, not exceeding $300 in value pro­
visions for debtor’s family for one year’s support, tools kept for
purpose of carrying on trade, and stock manufactured in whole
or in part by debtor not exceeding in value $400; library of pro­
fessional man; presses, type, and tools of publisher of news­
paper, not exceeding $2,000, and his stock in trade not exceeding
$400; watch, sewing machine, typewriter, bicycle, seed for use of debtor
for one season not exceeding certain amounts and binding material
sufficient for use in harvesting the crop raised from such seed; library
and apparatus of college or school; money payable to wife or child
from insurance on life of deceased husband or father nor exceeding
$10,000; money or relief from benefit association; money from insur­
ance on exempt property; wages not exceeding $35 for services rendered
during preceding 30 days; but all wages paid and earned within said
thirty day period shall be considered a part of (or all) of said exemp­
tion (('hap. 202, Laws 1915 )
Holidays. January 1st, February 12th and 22d, Good Friday.
May 30th, July 4th, first Monday in September, Tuesday after first
Monday in November each even-numbered year telection day),
November llth (Armistice Day), and December 2.5th are legal holi­
days. Thanksgiving day in so far that negotiable instruments or
contracts due that day are payable next succeeding business day. It is
provided that when Sunday and one or more legal holidays or two or
more legal holidays fall on the same day, and when Sunday and one or
more legal holidays, or two or more legal holidays, immediately
succeed each other, then negotiable instruments etc. shall be deemed
as due or maturing on the day following the last of such days.
Interest. Six per cent is legal rate, but by special contract any
rate not exceeding 8 per cent may be exacted. Usurious contracts
are void.
Judgments may be entered by default in district courts at expira­
tion of twenty days after service of summons. When docketed in those
courts they become liens upon all real estate of the debtor in the county
where docketed then owned by him or afterwards acquired, and the
lien continues for ten years after the entry of the judgment. Tran­
scripts of judgments in justice and municipal courts may be filed in
district court and there docketed, and then become lien on real estate.
Liens. To preserve a mechanics lien a verified statement must
be filed by the lien claimant within ninety days after furnishing the
last Item of labor or material in the office of the register of deeds of
the county in which the improved premises are situated, or if claimed
upon a line of railway or its appurtenances with the secretary of state.
The lien may be released by a court order on deposit with the clerk
of the District Court of a sufficient sum of money to protect the lien
claimant, and anyone interested in the property may bring an action
in the nature of an action to determine adverse claims to remove the
lien. Action to foreclose the lien must be commenced within one
year of the time of the filing of the verified statement.
Limitation of Actions. On contracts express or implied six
years; judgments ten years; to foreclose mortgages fifteen years; to
recover real estate, fifteen years. But no action shall be maintained
on a judgment note, or other instrument authorizing Confession of
Judgment unless begun within one year after Cause of Action accrued:
and no action shall be maintained upon any judgment of any court of
the U. S or of any State or Territory entered by Confession under a
warrant of attorney, unless the action upon such judgment be begun
within one year after the rendition or entry thereof.
Married Women. Property acquired by wife before or after mar­
riage remains her separate estate. It is liable for her debts and tort*
to the same extent as if she were unmarried, and she may make any
contract which she could make if unmarried, except that no convey­
ance or contract for sale of her homestead or any interest therein ia
valid unless her husband joins in the same.
Both husband and wife are liable for necessaries furnished to and
used by the family
Mortgages on real estate executed in the presence of two subscrib­
ing witnesses, acknowledged and recorded in the office of the register
of deeds of the county in which the mortgaged premises are situated
may be foreclosed by publication or by action. The mortgagor, his
assigns, and creditors of a deceased mortgagor who have proved their
claims in probate court may redeem within one year from the date of
the foreclosure sale.
The authority of an attorney conducting a foreclosure by adver­
tisement. must be in the form of a Power of Attorney, executed and
acknowledged by the mortgagee or assignee in the same manner as
a conveyance and recorded prior to the sale in the County where
the foreclosure proceedings are had.
The mortgagor may covenant to pay or authorize the mortgagee
to retain any attorney's fee in case of foreclosure of not exceeding
$25 where the mortgage debt does not exceed $500; $50 where the
mortgage debt exceeds $500 and does not exceed $1,000; $75 where
the mortgage debt exceeds $1,000 and does not exceed $5,000; $100
where the mortgage debt exceeds $5,000 but does not exceed $10,000;
and $200 where the mortgage debt exceeds $10,000. Mortgagor or
subsequent lien holder may before foreclosure sale pay debt and costs
In full in which case attorney's fee shall not exceed fifty dollars.
A Registry Tax of 15 cents is Imposed upon each $100 or fraction
thereof of the principal debt secured by any mortgage covering prop­
erty within the State of Minnesota and recorded in said State, in
case the maturity of any portion of the debt so secured shall be fixed
at a date more than five years and sixty days after the date of said
mortgage, the amount of such Registry Tax shall be at the rate of 25
cents on each $100. No such mortgage or assignment or satisfaction
thereof or papers relating to its foreclosure, shall be recorded or regis­
tered unless such tax has been paid, nor shall any such document or
record thereof be received in evidence in any court or have any validity
as notice or otherwise. No mortgage nor papers relating to its fore­
closure, nor any assignment or satisfaction thereof shall be recorded or
registered after the passage of the act, unless said tax shall have been
paid; nor shall any such document or any record thereof be received in
evidence in any court or have any validity as notice or otherwise; but
if the tax be paid, no error in computation or ascertainment of the
amount thereof shall affect the validity of such mortgage or the record or
foreclosure thereof. The underlined portion constitutes new law.—(See
Session Law of Minnesota for 1929, Chapter 222) If such mortgage
describe real estate outside of Minnesota, such tax shall be imposed
upon such proportion of the whole debt secured as the value of the
real estate described in this Start bears to the value of the whole real
estate, such value to be determined by the State Auditor upon
application of the mortgagee.
Notes and Bills of Exchange. Uniform negotiable Instrument#
Law has been in force since April 15, 1913. Commercial paper is
payable at the time fixed therein without grace. When due or pay­
able on Saturday or on Sunday, or any legal or bank holiday, the

2194

BANKING AND COMMERCIAL LAWS—MISSISSIPPI

same is payable upon the business day next succeeding, and may
be protested on such succeeding day.
Bight to Hold Property. No person unless he be a citizen of the
United States, or has declared his intention to become a citizen, and
no corporation unless created under the laws of the United States, or
of some state thereof, shall acquire lands exceeding 90,000 square feet,
except by devise, inheritance, or through security for indebtedness.
This does not appiy to actual settlers on farms not exceeding 160 acres,
or to subjects of a foreign country, whose rights to hold. lands are
secured by treaty.
No corporation, more than 20 per cent of whose stock is owned by
persons not citizens of the United States, or by corporations not
created under its laws, or those of some state thereof, can acquire
lands, and no corporation unless organized for the construction or
operation of a railway canal or turnpike can acquire more than 5,000
acres or more than is necessary for its operation, and lands granted
it by the State or United States.
But this does not apply to lands acquired in the collection of debts
nor to a person or corporation engaged in selling lands to actual
settlers, or engaged in manufacturing in Minnesota while so engaged.
Such persons or corporations not so engaged must sell what they had
April 13, 1911, within ten years from that date and sell what they
acquire subsequent to that date within ten years after they acquire it.
Sales of Goods. The Uniform Sales Act became effective April 20
1917.
Securities Commission. See Blue Sky Law.
Taxes. Personal property is assessed once a year; real estate
every two years. Taxes on both classes of property are levied every
year. Taxes on real estate constitute a prior lien. Land on which
taxes not paid sold on second Monday in May each year. Redemption
may be made sixty days after service of notice of expiration of redemp­
tion; this notice cannot be served until the expiration of three years
after sale. Person redeeming must pay original tax penalties and
Interest at the rate bid at the sale and in addition thereto costs. Onehalf of real estate taxes must be paid June 1 and if not, penalty of
5 per cent and 1' per cent per month until November 1 attaches.
Second half must be paid November 1, and if not then paid, a penalty
of 10 per cent attaches. Infants and persons of unsound mind may
redeem within one year after such disability shall cease, but the right
to redeem must be established in a suit in court. Moneys and credits
are subject to an annual tax of three mills on each dollar of the fair
cash value thereof Moneys and credits belonging to incorporated
banks located within the state are exempt. Real estate mortgage
Indebtedness is exempt from the moneys and credits tax; but is taxed
under the mortage registry tax law at the rate of 15 cents per hun­
dred. except where the indebtedness or a portion thereof runs for a
longer period than five years and sixty days, in which event the
rate on such indebtedness or portion is 25 cents per hundred.
Wills. Every person of full age and sound mind may dispose of
property by will in writing signed by the testator, or by some person
in his presence and by his direction, attested and subscribed in his
presence by two or more competent witnesses. Every person includes
married women. If, after making a will the testator marries, the wilt
is thereby revoked.

SYNOPSIS OF

THE LAWS OF MISSISSIPPI
RELATING TO
BANKING AND COMMERCIAL USAGES
Revised by Scott, Scott & Barbour, Attorneys at Law
Capital National Bank Bldg., Jackson, Miss.
(See Card in Attorneys’ List)
Accounts. Sworn to and filed at commencement of suit entitles
plaintiff to judgment, unless defendant files affidavit denj ing, or proves
on trial that he never entered into any contractual relation. The
affidavit must be by the creditor or his agent on actual knowledge,
affidavit on information and belief not sufficient. All accounts must
be itemized.
Acknowledgments before any judge, clerk of a court of record
under his seal, justice of the peace, notary public, or member of the
board of supervisors, before any police justice, or mayor of any city,
town, or village. Acknowledgments in another state may be before
any of the judges of the supreme court, or any district judge of the
United States, or a judge of the supreme or superior court in any state
or territory, any justice of the peace, whose official character shall
be certified to under the seal of some court of record in his county,
or by any commissioner residing in such state or territory, appointed
by the governor of Mississippi, or a notary public or a clerk of a court
of record having a seal of office. Acknowledgments or proof of
deeds to property in this State by persons in a foreign country may be
made before any court of record, or the mayor or chief magistrate
of any city, borough, or corporation where the grantor or witnesses
reside, or may be, or before any commissioner appointed by the gov­
ernor of this State, or before any ambassador, foreign minister, sec­
retary of legation, or consul of the United States. The certificate
shall show that this party or party and witness were identified before
the officer, and that the party acknowledged the execution of the
instrument, or that the execution was duly proved by the witness or
witnesses. Acknowledgment must state that party “acknowledged
that he signed and delivered" instrument.
Actions. All distinction as to forms abolished. Service five days
before return day. All action triable in the circuit court and in county
court where amount in controversy exceeds $200.00 at first term
in which the defendant has been personally served with process thirty
days before the return day. Mandamus, quo warranto, mechanics’
liens, attachments, and replevin triable at return term on five days
notice.
Administration of Estates. Had in chancery court, according
to will, if any. Claims against deceased must be registered within
six months after the first publication of notice to creditors; registra­
tion stops the general statute of limitations. All debts are to be paid
before heirs, distributors, or legatees. Claims against insolvent
estates are paid pro rata.
Affidavits or Oaths before a judge of any court of record, clerk of
such court, master in chancery, member of the board of supervisors,
justice of the peace, notary public, mayor, or police justice of a city,
town or village; in another state by any officer thereof, or of the
United States, authorized to administer oaths.
Aliens. No restrictions on the rights of resident aliens to acquire
property or dispose of it. Non-resident aliens can not hold land, but
may take liens thereon to secure debts and purchase at foreclosure
thereof, and thereafter hold it for not longer than twenty years, with
power to sell to a citizen in fee; or he may retain it by becoming a
citizen. See title “Corporations.”
Appeals from justice court to circuit or county court within ten
days. From county to circuit ten days. From circuit and chancery
courts to supreme court within six months, but notice to stenographer
must be given within ten days after adjournment of Court, in order
to incorporate evidence in record. Appeals also in certain cases from
board of supervisors and municipal courts.


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Arbitration. Parties may submit to arbitration of one or more
disinterested arbitrators, with agreement that proper court shall enter
Judgment.
Arrests made by certain officers, or private persons may arrest for
offense committed in his presence. No arrests or imprisonment for
debt.
Assignments and Insolvency. No insolvent law. An assign­
ment may be made for the benefit of creditors. Debtor, though
Insolvent, may prefer creditors, if in good faith and no benefit, direct
or indirect, is reserved. No provision for the discharge of a debtor
on his making an assignment. In general assignments, where the
value exceeds $1,000, the assignee must give bond and administer
the trust in chancery. Preferences not prohibited. Practically super­
seded by bankrupt law.
Attachment. Against a debtor who is a non-resident or who
removes or is about to remove himself or property out of the State:
who so absconds or conceals himself that he cannot be served with a
summons: or who incurred the debt in conducting the business of a
ship, steamboat or other water craft in some of the navigable waters
of this State; or who assigns or disposes of his p