View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

The Following States Have Put in Operation
THE

NEGOTIABLE

INSTRUMENTS

State
In Effect
Alabama................................ ................. Jan.
1, 1908
Alaska...................................
28, 1913
Arizona..................................
1, 1901
Arkansas ............................... ................. Apr. 21. 1913
California.............................. ................. July 31. 1917
Colorado................................ ................. July 19, 1897
Connecticut........................... ................. Apr. 5, 1897
Delaware............................... .............Jan.
1. 1912
Dist. of Columbia................. ................. Jan. 12, 1899
Florida....................... ........... ................. Aug. 3. 1897
Hawaii...................................
20, 1907
Idaho.....................................
10, 1903
Illinois................................... ................. July 1, 1907
Indiana..................................
30, 1913
Iowa....................................... ................. July 4. 1902
Kansas................................... ................. June 8, 1905
Kentucky.............................. ................. June 13. 1904
Louisiana............. ................. ............ . Aug. 1. 1904
Maine..................................... ................. July 7, 1917
Maryland.............................. ................. June 1, 1898
Massachusetts....................... ................. Jan.
1, 1899
Michigan...............................
16, 1905
Minnesota........................... ...............July
1, 1913
Mississippi............................ • • • • .......... July 7, 1916
M issouri................................ ................. June 16, 1903
M ontana............................... ................. Mar. 7, 1905

LAW

State
In Effect
Nebraska.............................
1, 1905
Nevada................................
1, 1907
New Hampshire. ................ ................... Jan.
I, 1910
New Jersey ........................
4, 1902
New Mexico........................
21, 1907
New.York.........................,
1, 1897
North Carolina...................
8, 1899
North D akota..................... ................... July L 1899
Ohio..................................... • ................. Jan.
1, 1903
Oklahoma........................... ................... June 10, 1909
Oregon.................................
19, 1899
Pennsylvania......................
2, 1901
Philippines..........................
31, 1911
Rhode Island...................... ...............J u l y
1, 1899
South Carolina...................
25, 1914
South D akota..................... ................... July 1. 1913
Tennessee............................
16, 1899
Texas..................................
18, 1919
U ta h ..................................... ..................July 1, 1899
Vermont..... ..........................
1, 1913
Virginia.......................
................ July 1, 1898
Washington.........................
7, 1899
W. Virginia......................... .
1. 1908
Wisconsin............................
15, 1899
Wyoming............................. ................... Feb. 15, 1905

The M aturity Section of this Law is as follows:
Every negotiable instrument is payable a t the time fixed therein without grace. When the day of m atur­
ity 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 instru­
ments payable on demand may, at the option of the holder, be presented for payment before 12 o’clock noon on
Saturday when th at entire day is not a holiday.
Exceptions to the above Section are as follows:
MASSACHUSETTS, NEW HAMPSHIRE and RHODE ISLAND allow grace on Sight Drafts.
ARIZONA, KENTUCKY, NORTH CAROLINA and WISCONSIN paper maturing Saturday is payable
the same day.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1705


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

D ates of R eg u lar M eetings
of L e g isla tu re s
A la b a m a ____ _____
A la s k a __________ _
A r iz o n a ____ .__ ___
A rk a n sas______ &__
C a lifo rn ia _________
C o lo ra d o _*.________
C o n n e c tic u t_______
D elaw are__________
D istrict of Colum bia
F lo rid a __________
G e o rg ia ___________
H a w a ii___________
I d a h o _______ _____
Illin o is______ _____
I n d ia n a __ ________
Io w a _____________
K a n s a s .___________
K entucky_________
L o u is ia n a ________
M aine _______ .____
M a ry la n d ________
M a ssa c h u se tts------M ichigan_________
M in n e so ta ________
M ississippi-_______
M issouri__________
M o n ta n a _________
N e b ra sk a ..,_______
N evada ---------------N ew H a m p sh ire .
N ew Jersey_______
N ew M exico______
N ew Y o rk ._____ _
N orth C arolina____
N orth D ak o ta_____
O h io _____ _________
O k la h o m a ________
O reg o n _______ ____
P e n n sy lv a n ia _____
R hode Isla n d _____
South C aro lin a____
S o u th D ak o ta-------T e n n e sse e _______
T e x a s _____________
U t a h . . ____ ____. . .
V e rm o n t_________
V irginia ___________
W a s h in g to n ______
W est V irg in ia ____
W is c o n s in _______
W y o m in g ______ _

January, 1915, and every four years.
A T errito ry .
J a n u a r y _____________________ E v ery odd year.
J a n u a r y _____________
E very odd year.
J a n u a r y _____ __________ E very odd year.
J a n u a r y _______
E very odd year.
J a n u a r y _____________________ E very odd year.
J a n u a r y _____________________ E very odd year.
.U nder U. S. G overnm ent.
.A pril________________________.E v e ry odd year,
J u n e ___ _______________ E very year.
.F e b ru a ry ____________________ E v ery odd year.
E very odd year.
J a n u a r y ___________
J a n u a r y _____________________ E very odd year.
J a n u a r y _________ |_____ E very odd year.
J a n u a r y ______ *_______ E very odd year.
J a n u a r y __ _____________ E very odd year.
J a n u a r y ____ .__________E very even year.
.M ay________
E very even year.
J a n u a r y _______
E very odd year.
J a n u a r y ______________ .E v e ry even year.
J a n u a r y ________________ E very year.
J a n u a r y _____ ______*.____ E very odd year.
.J a n u a r y _____________________ E very odd year.
.J a n u a r y ____________
E very even year.
.J a n u a r y _____________________ E very odd year.
J a n u a r y _____________________ E very odd year.
.J a n u a r y _____________________ E very odd year.
J a n u a r y ________________ E very odd year.
J a n u a r y ___ ____________ E very odd year.
J a n u a r y _____ _________ E very year.
.J a n u a r y __________
E v ery odd year.
J a n u a r y _____________
E very year.
J a n u a r y ____ ____
E very odd year.
J a n u a r y ___ ________
E very odd year.
J a n u a r y _____________________ E very odd year.
.J a n u a r y _______________ E very odd year.
.J a n u a r y ____ _______,____E very odd year.
.J a n u a r y ______________ E very odd year.
.J a n u a r y ________________ E very year.
.J a n u a r y ________________ E very year.
.J a n u a r y ____________________ „E very odd year.
.J a n u a r y ____ _________
E very odd year.
.J a n u a r y _____________________ E very odd year.
.J a n u a r y ________ ___ ____ E very odd year.
-J a n u a ry __ _____________ E very odd year.
.J a n u a r y _____________________ E very even year.
- J a n u a r y _____________________ E very odd year.
.J a n u a r y _____________________ E very odd year.
.J a n u a r y ____________________ E very odd year.
- J a n u a r y _____________________ E v ery odd year.
1706

DIGEST OF BANKING AND COMMERCIAL LAWS
COMPILED EXPRESSLY FOR EACH EDITION OF THE RAND-McNALLY BANKERS’ DIRECTORY
AND BANKERS REGISTER
by prominent Attorneys in each S tate of the United States and each province of Canada, the name
of the compiler appearing a t 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 Instrum ents Law is in effect are listed on th e
index to Laws. For T abulated Inform ation, for quick reference in regard to Interest Rates, D ays of
Grace, and Statutes of Limitations, see page opposite page 19.

Sy n o p s i s

In due course, not a p arty to th e alteration, he m ay enforce paym ent
thereof according to its original tenor. M aterial alterations consist
of any changes in date; sum payable, interest on principal; tim e or
place of paym ent; num ber and relation of parties; m edium or currency
in which paym ent is to be m ade.
A r b itra tio n . Courts are compelled by sta tu te to m ake an order
subm itting cases for arbitration when moved for by th e parties, and
to continue this cause for one term for an award, b u t n ot longer w ith­
o ut consent of parties, or good cause 1 being shown therefor. The
aw ard of the arbitrators m ay be entered up and enforced as th e judg­
m ent of th e proper court w hether m ade in a pending su it or not.
A rrest. T here can be no arre st on civil process, except for con­
tem pt and in cases of alleged lunacy.
A ssig n m e n ts a n d In so lv en cy . E very general assignm ent m ade
by a debtor, or conveyance by a debtor of substantially all of his
property in paym ent of a prior debt, by which a perference or priority
of paym ent is given to one or more creditors, shall enure to the benefit
of all the creditors equally, b u t this section shall not apply to m ort­
gages, pledges, or pawns given to secure a d eb t contracted contem ­
poraneously with th e execution of th e m ortgage. All assignm ents by
a debtor m ade w ith in ten t to hinder, delay, or defraud creditors are
void. All deeds of assignm ent for th e benefit of creditors shall, as
soon as executed, be filed and recorded in th e office of th e judge of
probate of the county in which th e property is situated. E very
judgm ent confessed, attachm ent procured by th e debtor, or o ther dis­
position of property by which a debtor conveys all, or substantially
all, of his property which is subject to execution in paym ent or as
security for a debt shall be deem ed a general assignment.
A tta c h m e n t process will issue upon affidavit by the creditor or his
agent of the am ount due and th a t the debtor absconds, or resides,
out of th e S tate, or secretes him self so th a t process cannot be seryed
upon him, or Is about to remove out of th e S tate, or has or is abou t to
fraudulently dispose of his property, or fraudulently withholds money,
chattels, or effects which are liable to th e satisfaction of his debts;
plaintiff m ust give bond in double th e am ount claimed. A ttachm ents
will issue for th e following dem ands; 1. To enforce the collection of
a debt, w hether it be due or not, a t the tim e the attach m en t is taken
out. 2. For any m oneyed dem and, th e am ount of which can be
certainly ascertained. 3. To recover damages for a breach of con­
tra c t when th e dam ages are n o t certain or liquidated. 4. When
th e action sounds in dam ages m erely in falling cases, viz.: 1. W here
defendant is a non-resident. 2. W hen th e defendant has absconded.
3. W hen defendant has secreted himself. 4. W hen defendant is
about to remove from the S tate. 5. W hen defendant is abou t to
remove his. property from S tate. 6 . W hen defendant is about to or
has fraudulently disposed of his p roperty or fraudulently withholds
same. One non-resident m ay sue o ut an attachm ent against another
non-resident by m aking oath th a t th e defendant has not sufficient
property within the S tate of his residence wherefrom to satisfy th e
debt. A ttachm ents m ay be sued o ut in aid of a pending suit when
any of the above grounds exist by m aking affidavit and executing
bond. G arnishm ent process will issue in aid of attachm ent in all
such cases. G arnishm ent m ay be dissolved by giving bond. In all
cases of attachm ents sued o u t by a resident solely upon th e ground
th a t th e defendant is a non-resident, th e attach m en t m ay issue w ith­
out giving bond, b u t if defendant appears and pleads, bond m ust be
given or th e attach m en t dismissed.
B a n k s. The national bank system is in force in this S tate uncon­
trolled in any w ay by S tate laws, except th a t th e shares are subject
to taxation as o ther personal property, b u t the bank is required to pay
the tax.
T here is no provision of law for th e establishm ent of banks of issue
in this S tate. Banks of discount and deposit m ay 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 a t a greater ra te th an 8
her cent cannot enforce th e collection of sam e except as to th e prin­
cipal, and if any interest has been paid it m ust be deducted from th e
principal.
B lu e S ky L aw . I t is unlawful to sell or offer for sale in th is
S tate any speculative securities w ithout first obtaining perm it from
th e S tate Securities Commission. 1919 General Acts of A labam a,
as am ended in A cts 1920.
C o lla te ra ls. Receipt m ust be given for if dem anded. Pledges or
collaterals n o t transferable w ithout transfer of the debt; after two
days’ notice in writing collaterals m ay be sold, by advertising for five
days, a t public outcry.
C o n d itio n a l S ales are good between the parties, b u t void where
personal property delivered to vendee as against purchasers for a
valuable consideration, m ortgages and judgm ents creditor, w ithout
notice, unless in writing and recorded in the office of the probate
judge.
C onditional contracts of sales m ust be recorded In office of the
Judge of P robate of th e county in which the property is located,
to be valid against subsequent purchasers, judgm ent creditors, or
m ortgagees w ithout notice, except in counties having a population
of more th a n 80,000 when contract is for a less am ount th an $ 200 .00 .
C o n v e y an ces. All persons of th e age of tw enty-one years, n ot
laboring under some legal disability, m ay convey th eir real estate or
any interest therein by instrum ent in w riting signed by th e grantor
or Ms agent duly authorized in w riting, an d attested by one witness, or
if th e grantor cannot write, by tw o witnesses who are able to write,
an d who sign th eir nam es as witnesses. If th e grantor is n ot able to
sign his nam e it m ust be w ritten for him , and the.w ords “ his m a rk ”
w ritten over or against it. The person writing his nam e m ust sign
as a w itness. A parol lease for less th a n One year is valid. A m arried
woman over eighteen years of age m ay convey dower in her husband’s
lands, and has generally th e same rights as m arried women over tw entyoiie years of age. T he husband m ust join in any conveyance of the
wife’s separate estate. Conveyances, to operate as notice, m ust be
acknowledged and recorded. General acknowledgment m ust be
signed to m ake instrum ent self-proving. M arried women m ust
acknowledge twice in the event the hom estead is conveyed. Form
of general acknowledgment is as follows:
The S tate of A labam a,.......................C ounty
I ............................... ............................... i , ...................a (style of officer),
hereby Certify t h a t ....................... | .......................... whose nam e is signed
to the foregoing conveyance and who is known to me, acknowledged
before me on th is d a y ,ith a t. being informed of the contents of th e

of

THE LAW S OF ALABAMA
RELA TIN G TO

BANKING AND COMMERCIAL USAGES.
Revised by R i t t e r , W y n n & C a r m ic h a e l , Attorneys a t Law,
Birmingham. (See C ard in A ttorneys’ List.)
A cknow ledgm ents o r proof of real estate instrum ents m ay be
taken before one of th e following officers: 1st. W ithin this S tate.
Judges of the suprem e and circuit courts and the clerks of such courts,
chancellors, registers in chancery, judges of th e 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 th at “ being inform ed of the contents of the conveyance he
executed the sam e voluntarily on the day the name bears d a te .’’
2d. Outside of S tate—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 th e lim its
of the United States, by th e judges of any court of record, m ayor or
chief m agistrate of any city, town or borough, or county, notaries
public, or by an y diplom atic, consular, or commercial agent of the
United States. Foreign officers m ust attach official seal which fact
must be recited in body of certificate. F or form s of deeds see “ Con­
veyances.”
Actions. All ordinary suits a t law are commenced by suing o ut
a summons which m ust be accom panied by a com plaint sta tin g the
cause of action. N on-resident plaintiffs are required to give security
for costs. When two or more persons are jointly bound by judgm ent,
bond, or agreem ent, th e obligation is several as well as joint.
Actions o n A c c o u n t. Suits upon open accounts m ay be accom­
panied by itemized, verified statem ent of the account, which when
filed with the summons and com plaint m ay be admissible in evidence
to prove the account unless its correctness is denied under oath by
defendant within th e tim e allowed for pleading. Such statem ents
must be sworn to by a person having knowledge of th e correctness
of the account and m ust show th a t th e am ount is due and unpaid
after allowing all offsets and counter claims and when sworn to out­
side State, m ust b ear official seal of officer, which fact m ust be recited
in the jurat.
Acceptance. Unconditional promise in w riting to accept a bill
before or after drawn is good in favor of all who take it upon faith
thereof for value. The holder m ay decline a qualified acceptance and
treat the bill as dishonored; if he takes qualified acceptance draw er
and endorsers are discharged.
A Check is a bill of exchange on a bank payable on dem and;
must be presented within reasonable tim e after issue and if dishonored,
notice must be given or draw er is discharged to th e extent of'loss
caused by delay; does not operate to assign any p a rt of draw er’s funds
in bank, and bank is not liable unless it accepts or certifies. I f holder
has check certified the draw er and endorsers are discharged. The
making, uttering, drawing, or delivery of a check, draft, or order
upon which paym ent is refused upon due presentation because of
lack of funds shall be deem ed prim a facie evidence of in ten t to de­
fraud and p arty m ay be convicted of a misdemeanor.
The present negotiable instrum ent law of Alabama, consisting of
196 sections went into force Ausugt 9, 1907. I ts provisions do not
apply to instrum ents m ade prior thereto. T he act so m aterially
changes the law in this S tate as to suggest the propriety of special
examination in an y doubtful case.
A d m in istratio n of estates is had in th e probate courts of dece­
dents’ residence. All claims m ust be presented w ithin twelve m onths
after the same have accrued or w ithin twelve m onths after the g rant of
letters testam entary or of adm inistration, or else barred. Infants and
Persons of unsound m ind have one year to present th eir claims after
disabilities are removed. Adm inistration of intestate is granted. 1st:
To the husband or widow; 2d: T he next of kin entitled to share in
"he distribution of the estate; 3d: The largest creditor of th e intestate
residing within th is S tate; 4th: Such other person as th e judge of
probate m ay appoint. T here Can be no appointm ent until after
•xpiration of fifteen days from date of death. Preference m ust be
«zeroised within forty days or rights relinquished. I f several entitled
jo administer, m en are preferred to women and whole blood to half
rUfffiPP Non-resident executors and adm inistrators m ay sue In this
J»atp by recording in probate judge’s office copy of letters and giving
oond to faithfully adm inister property. A non-resident m ay be
appointed adm inistrator o r executor of a deceased resident’s estate.
^Affidavits m ay be taken w ithin the S tate before every judge or
aerk of any court, justices of the peace, and notaries public or any
otner person invested b y law w ith judicial functions. Outside th e
i *5** 'wftWn th e U nited S tates m ay be tak en before any judge or
no* i federal court, judge of any court of record in any state,
public and commissioners appointed by the governor. ForyyS officer taking affidavit m ust attach seal which fact m ust be
«cited in the ju rat.
Aliens. “ Foreigners who are, or m ay hereafter become, bona fide
residents of this S tate,'sh all enjoy th e sam e rights in respect to th e
possession, enjoym ent, and inheritance of property as native-born
citizens.”—Sec. 34, Const.
Alterations. When a negotiable instrum ent is m aterially altered
g *““°ot the assent of all the parties liable thereon, it is voided
aSo t ,?s a»ainst a p arty who has him self m ade, authorized, or
^?*}ted to the alteration and subsequent endorsers. B ut when an
instrument has been m aterially altered and is in the hands of a holder


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1707

1708

BA N K IN G A ND COM M ERCIAL LAWS—ALABAMA

conveyance, he executed th e same voluntarily oh the day th e same
bears d ate. Given under m y hand and seal, th is ................... day of
................ a : D.
(Seal)
I
N otary Public.
No tim e is required w ithin which conveyances shall be recorded.
T hey operate as notices from date of delivery to probate judge for
record. (See Acknowledgments.) T hey m ay be used as evidence
w ithout further proof of exécution. Leasehold estates m ay be
created to last n ot exceeding tw enty years, b u t if longer void as to
excess. A m arried woman m ust m ake the following acknowledgment
to a conveyance of a hom estead:
S tate o f . ................., C ounty o f ............... ....
I . ....................... judge o f.'............. (or other officer) do hereby certify
th a t,,o h t h e . . . . . . . . . .d ay o f . . . . . . . . . . . . , 19. .'.., came before me
th e w ithin n a m e d .........................................., known to m e (or made
known to me) to_ be th e wife of the w ithin n am ed ................. . . . . . . .
who, being examined separate and ap a rt from her husband touching
her signature to th e w ith in ................... . acknowledged th a t she signed
th e sam e of her own free will and accord, and w ithout fear, constraint,
or th re a ts on th e p a rt of her husband.
In witness whereof, 1 hereto set m y hand and official seal this
. ........... ...... .d ay o f ....................... 1 9 . . . .
(Official Character.)
Corporation to m ake following acknowledgm ent:
• ..................... ................ ....
. t h a t . ..................................... .......................
Whose nam e a s ............................. ......, of the said corporation, is signed
to th e foregoing conveyance, and who is known to me, acknowledged
before me on th is day th a t, being inform ed of th e contents of the
conveyance, be, as such officer, and with full authority, executed the
sam e voluntarily for and as th e act of said corporation.
C o rp o ra tio n s . E very com pany, corporation, or association, not
organized under th e laws of Alabam a, engaged in any other business
th an insurance, shall, before engaging in any business in th is State,
file in th e office of th e secretary of state, a t th e capítol in M ontgom ery,
an instrum ent in w riting under th e seal of such com pany, corporation,
or association, and signed officially by th e president and secretary
thereof, designating a t least one known place of business in th is State,
and an authorized agent residing thereat. If such corporation is
engaged in any business of insurance, th e statem ent m ust be filed in the
office of th e insurance commissioner. I f th e agent is changed, a new
paper m ust be filed. Held not to apply to corporations selling goods
by travelling agent or sample. Foreign corporations transacting busi­
ness in th is 'S ta te w ithout complying w ith above provisions for each
offense forfeit to th e S tate $1,000, and any person acting as agent for
foreign Corporation th a t has n ot so complied, forfeits for each offense
$500; All foreign corporations doing business in th is S tate 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. E very foreign corporation
required to procure from secretary of sta te a perm it to do business
in th e S tate. T his perm it costs $10 per annum . •
C o u rts . T erm s and jurisdiction. T he suprem e court, except to
issue w rits of injunction, habeas corpus, quo w arranto, and other
remedial and original w rits necessary to its supervision of inferior
courts, and im peachm ents of judicial officers, has only appellate juris­
diction and cases are tried on the record sent up. C ourt of appeals
h as final appellate jurisdiction in the following cases: 1. W hen
th e am ount involved exclusive of interest and costs does n ot exceed
th e sum of $1,000. 2. Of all misdem eanors, including th e violation
of tow n and city ordinances, bastardy, habeas corpus, and all felonies,
where th e punishm ent has been fixed a t tw enty years or under.
Circuit courts .have unlim ited common law jurisdiction when th e
m atter or sum in controversy exceeds $50, and exclusive jurisdiction
of libel, slander, assault and battery, and ejectm ent. The courts of
chancery have exclusively equity jurisdiction. Regular term s of
bo,th twice a year in nearly every county. C hancery courts have
full equity powers. Justices of th e peace have jurisdiction of all
civil causes where th e am ount in controversy does n ot exceed $100 in
value, except in cases of libel, slander, assault and b attery , and
ejectm ent, , N am es of all parties, plaintiff and individual nam es of
co-partners, m ust be set out in w rits. P artnership m ay be sued in
courts of law, in firm nam e, w ithout setting forth nam es of co-partners, b u t judgm ent in such suits bind only partnership’s property,
not th a t of individual partners. T he w rit m ay .b e served upon any
one of th e partners; the judgm ent reaches th e partnership property
alone. Any one partner, or his personal representative, m ay be
sued aloné on a partnership obligation. N on-residents m ust give
security for costs when suit is commenced or within such tim e there­
after as the court m ay direct. M oney m ay be deposited w ith the
clerk instead of sureties.
D ays o f G race are abolished. (See Negotiable Instrum ents.)
D e p o s itio n s . In cases a t law, depositions m ay be taken of w it­
nesses who cannot be present a t the trial in th e following cases:
W hen th e witness is a female; when th e witness is too sick to a tten d
court; when the witness resides more th a n 100 miles from the place of
trial, or is absent from the S tate; when th e witness is about to leave
th e State, and not retu rn in tim e for the trial; when th e witness is the
sole witness of th e facts; when th e witness is one of th e officers desig­
n ated in Code No. 4030. Affidavit m u st be m ade of one of th e above
facts, and of the m ateriality of th e witness. M ay be tak en on inter­
rogatories by a commissioner appointed by th e court for th a t purpose.
T he commissioner m ay be any suitable person, need not be an officer.
In equity suits, where witnesses live w ithin 100 miles of th e place of
trial, depositions m ay be taken by oral exam ination before th e regiter, or a special examiner, or commissioner appointed for th e purpose.
D e s c e n t a n d D is tr ib u tio n . T he real .estate of persons dying
in testate, in th is S tate, descends, subject to the paym ent of debts and
th e widow’s dower as follows: F irst to th e children of the intestate
or their descendants per stirpes in equal p arts. N ext, to th e parents,
if th ey survive, in equal parts. I f 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 th eir descendants, then th e whole estate shall go to th e surviving
parent, If there are no children or their descendants, and no father
or m other, then to th é brothers and sisters of the intestate, or their
descendants, in equal parts. If there are none of th e above to take,
th en th e whole to th e husband or wife of th e intestate, and if there be
no husband or wife or none of the foregoing living, th en to th e next
of kin in equal degree in equal parts. I f there are no next of kin
it escheats to the S tate. The personal estate is distributed the same
as th e real estate,, except th a t if th ere are no children th e widow is
en titled to all of th e personal estate. If b u t one child she takes onehalf. I f n ot more th an four children to a child’s p a rt and if more
th an four to one-fifth. Posthum ous children take as others. Illegiti­
m ate children inherit from th e ir m othér. The husband upon the
d eath of th e wife is entitled to half of her personal estate absolutely,
and to th e use of all of her real estate for life, unless he has been divested
of all control over her estate by a degree of th e chancery court.
Dam ages recovered by personal representative for death of deceased
are distrib uted according to s ta tu te of distribution and are exem pt
from paym ent of debts.
D ow er. Unless th e wife has relinquished her right of dower in the
m anner provided by sta tu te she is, upon th e d eath of th e husband,
en titled to dower in all lands of which the' husband was seized in fee
diming th e m arriage, or of which another was seized to his use or to
which he had a perfect equity, having paid all th e purchase money
therefor. T he dower interest is one-half when th e husband leaves no
lineal descendants, and one-third when th e estate is insolvent or the
husband leaves children or th eir descendants. I f the wife has a t the
death of th e husband a separate estate equal in value to her dower


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

interest, she shall n ot have dower, and if of less value is only entitled
to such am ounts as w ith her estate will m ake th e full value of the dower.
E x e c u tio n s. P roperty subject to : 1st: On real property to
which th e defendant has a legal title or a perfect equity, having naid
th e purchase money, or in which he has vested interest, in possession
reversion, or rem ainder, w hether he has the entire estate, or is entitled
to it in common w ith others. 2d: On personal p roperty of the defen
d an t (except things in action), w hether he has th e absolute title there'
to, or the right only to th e possession thereof for his own life the life
of another, or a less period. 3d: On an equity of redem ption In either
land or personal property, when any interest less th an the absolute
title is sold. T he purchaser is subrogated to all th e rights of the
defendant, and subject to all his disabilities. W rit of fieri facias is a
lien only w ithin th e county in which it is received by the officer on
lands and personalty of defendant subject to levy and sale, from’the
tim e only th a t the w rit is received by such officer and continues as
long as w rit is regularly delivered to the sheriff w ithout th e lapse of an
entire term . A statem ent of a judgm ent certified by th e clerk of the
court m ay be filed in th e office of th e judge of probate, which makes
th e judgm ent a lien w ithin th e county in which it is filed for ten years
thereafter. Execution m ay be issued on such judgm ent a t any time
Executions issued by justices are liens on th e p roperty of the defen­
dant, on which th ey are levied, from the tim e of th e levy. An order
m ust be obtained from th e 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 suprem e court, and entails 10 p er cent damages
with legal interest and costs. In justice’s court sta y is granted on
good security, below $20 , th irty days over $20 . sixty days.
E x e m p tio n s . H om estead not exceeding 160 acres or $2,000 in
value.
Personal p roperty to th e am ount of $ 1,000 . Exem ptions of personal
property m ay be waived by instrum ent in writing except as to certain
household furniture and provisions and wages to am ount of $25.00
per m onth.
F ra u d . Obtaining m oney or goods on credit under false color or
pretense of carrying on business, or under false representation of
pecuniary condition, w ith in ten t to defraud, or bringing into the State
m oney or goods so obtained, punished as larceny.
S t a t u t e of F ra u d s . In the following cases, every agreement, or
note or memo thereof, expressing th e consideration, is in writing and
signed by th e p arty to be charged: 1st. E very agreem ent which by
its term s is n ot to be perform ed within one y ear from the making
thereof. 2d. E very special promise by an executor or administrator
to answ er dam ages out of his own estate. 3d. E v ery special promise
to answer for th e debt, default, or m iscarriage of another. 4th. Every
agreem ent, promise, or undertaking, m ade upon consideration of
m arriage, except m utual promises to m arry. 5th. E very contract
for th e sale of lands, tenem ents, or hereditam ents, or of any interest
therein, except leases for a term of n ot longer th an one year, unless
th e purchase money, or a portion thereof, be paid and th e purchaser
be p u t in possession by the seller.
G a r n is h m e n t m ay issue In any case after su it commenced upon
affidavit of necessity and bond as in attach m en t cases, or after judg­
m ent, w ithout bond.
H o lid ay s. The following are th e legal holidays: Sunday,
C hristm as D ay, first day of January, 19th day of January, 22d day
of February, M ardi Gras D ay, which is T uesday before Ash Wednes­
day, 13th day of April, 26th day of April, 3d day of June, 4 th day of
July, first M onday in September, 12th day of October, second Thurs­
day in October, Arm istice D ay which is th e 11th day of November,
and day designated by th e Governor for public Thanksgiving. If
C hristm as D ay, or th e first day of January, or th e 19th day of January,
or th e 22d day of February, or th e 13th day of April, or th e 26th day
of April, or the 3d day of June, or th e 4 th day of Ju ly falls on Sunday,
th e M onday following is th e holiday. I f any paper becomes due on a
holiday, it m ust be taken as due on th e next succeeding business day.
H u s b a n d a n d W ife. T he wife has full legal capacity to contract,
as if she were sole, except th a t she can n ot alienate or encumber her
real estate w ithout the husband joining in th e conveyance, unless the
husband be insane or has abandoned her, or is a non-resident, or is
im prisoned u n d e r a conviction for crim e for a period of two years or
m ore, in which cases th e wife m ay convey it as if she were sole.
H usband and wife m ay contract w ith each other, b u t the wife can­
n ot be surety for the husband. All of the property and the earnings
of th e wife are her separate estate, and are not liable for the debts of
the husband. The wife m ust sue and be sued alone for all matters
relating to her separate estate or contracts, and for all torts to her
person Or property. The chancery court has power to relieve of any
or all disabilities of coverture.
I n te r e s t. Legal rate is 8 per cent, and sam e is allowed on all open
accounts, judgm ents, and decrees. Usury forfeits all interests and
any sums paid as interest on an usurious contract shall be credited on
th e principal.
J u d g m e n ts o f courts of record are proved b y a certified transcript.
Judgm ent not a lien, b u t when a ceritfled statem ent thereof, made by
the clerk of th e court is filed in th e office of th e probate judge, it
becomes a lien on all property of the defendant therein in the county,
which is subject to execution for te n years, to enforce which execution
m ay issue a t any tim e within th a t period. Execution received by
sheriff during life of defendant m ay be levied after his decease or alias
execution issued and levied if there has n ot 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 th e peace is a lien only from tim e of its levy. All agreements to
confess judgm ent, or to authorize another to confess judgment, made
before the comm encem ent of the suit in which such judgments are
so confirmed are void.
M e c h a n ic s’ L ie n .
C ontractors, including subcontractors,
mechanics, m aterial men, and laborers have a lien on houses built
and th e ground on which th ey stand upon complying with the law.
L ie n fo r R e n t. The landlords of any store house, dwelling house,
or other building, shall have a lien on th e goods, furniture and effects
belonging to the ten an t, and sub-tenant for bis rent, which shall be
superior to all other liens, except those for taxes, also on crops grown
on rented premises for re n t of the current year
L im ita tio n s . N otes and stated accounts, six years; open accounts,
three years; sealed instrum ents, real actions, and motions against
officers, ten years; judgm ents, tw enty years; actions on the case, one
year. B ar created by s ta tu te can only be rem oved by a partial pay­
m ent, m ade on th e contract before th e bar is complete, or by an uncon­
ditional promise in writing. If anyone entitled to bring an action,
or m ake an entry on land, or defense founded on title to real estate,
be a t the tim e such rig h t accrues, within the age of twenty-one years,
or insane or imprisoned on a crim inal charge for a term less than me,
he shall have three years, or the period allowed by law, for bringing
such action, if the period allowed by law be less th an three years, after
th e term ination of such disability to bring such suit, etc., but no action
can be commenced after tw enty years. S tatutes of lim itation appo
to m arried women’s separate estates. Actions founded on a promise
in writing n ot under seal, or for trespass to person or property, must
be brought w ithin six years. S tatutes of lim itation are made appU'
cable to equitable as well as legal dem ands, b u t do not run against career
trusts. Any agreem ent or stipulation to shorten th e period presenoeu
by law for th e bringing of any action is void. Actions seeking renei
on th e ground of fraud where th e sta tu te created a bar. the cause oi
action begins to run upon discovery of th e fraud by aggrieved party.
No promise or acknowledgm ent is sufficient to remove the bar to a

BA NKING AND COM M ERCIAL LAWS—ALASKA
suit, except a p artial
so u g h t to be charged

paym ent m ade upon the contract by th e p a rty
before the bar is com plete, or an unconditional
promise in writing, signed by th e p a rty to be charged thereby.
M arried W o m e n . (See H usband and Wife.)
M ortgages are executed and acknowledged in th e sam e m anner as
deeds. M ay be foreclosed by bill in equity, or if th ere be a provision
to that effect, by sale under power, upon such default as authorized
a sale. All m ortgages are void against creditors or purchasers without
notice, unless recorded. M ortgages operate as notice from day of
delivery to probate judge for record. T here is no fixed tim e w ithin
which they shall be recorded. H om estead realty cannot be m ort­
gaged or otherwise aliened w ithout the voluntary signature and assent
of wife, evidenced by acknowledgment, upon private exam ination
separate and ap art from th e husband, and certified. All m ortgages
must be in writing, signed by th e m ortgagor. P aym ent of m ortgage
debt made before or after m at.urity of debt, revests in th e m ortgagor,
or his assigns, th e title to th e real or personal property m ortgaged, if
made in th e lifetim e of th e m ortgagor; if m ade 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 th e m ortga­
gor. C hattel m ortgages m ust be in writing. W hen the m ortgagor
is sued by th e m ortgagee for possession of th e m ortgaged property,
he may defend by showing paym ent of the debt, or p a rt paym ent and
a tender of th e balance, o r m ay pay it after judgm ent.
N egotiable I n s t r u m e n t s . M u st be payable in m oney and m ust
contain an unconditional prom ise to p ay a sum certain on dem and or
at a fixed or determ inable future tim e; m ust be payable to a specified
person or bearer; m ay be in installm ents and contain provision th a t
on any default th e whole shall become due; w ith exchange fixed or
current rate, interest, and atto rn ey ’s fees for collection; m ay authorize
sale of collaterals b u t cannot authorize confession of judgm ent if it
reads, “ I promise to p a y ” all signers are jointly and severally liable;
may be payable a t fixed tim e after date or sight, or after specified
certain event, b u t n o t upon a contingency; can waive exem ption from
execution; need n o t specify value given nor place where draw n or
payable; if issued, accepted, or endorsed when overdue it is payable
on demand; m ay be payable to tw o or m ore payees jointly, or one or
moreof several payees, or to th e estate of a deceased person; absence
or failure of consideration a defense against one n ot a holder in due *
course and partial failure a defense pro tan to . One n ot a p a rty to
Instrument placing a signature in blank before delivery becomes an
endorser. E very endorser engages th a t on due presentm ent it shall
be honored or th a t he will p ay th e am ount to holder or any subsequent
endorser who m ay be compelled to pay; no days of grace; when
maturity falls on Sunday or holiday paym ent is due on next business
day; if due on Saturday m ust be presented on next business day, b u t
if payable on dem and holder m ay present sam e before noon on Satur­
day. Fraud and circum vention in procuring execution of instrum ent
is a defense against an y holder.
Powers o f A tto rn e y . Powers of attorney or other instrum ents
conferring au th o rity to convey property m ust be proved or acknowl­
edged in the sam e m anner and m ust be received as evidence to the
same extent as conveyances (see Conveyances), and m sut be executed
|
as conveyances. A power of attorney to relinquish dower m ust be
executed by husband and wife jointly. H er signature m ust be
acknowledged as required for conveyances of land.
P re se n tm e n t. Is n o t necessary to charge one prim arily liable
except in case of bank notes; if payable a t special place ability and
willingness to pay it th ere a t m atu rity is equivalent to a tender: if
not on demand it m ust be presented on day it falls due, if on dem and
then within a reasonable tim e after its issue, except a hill of exchange
must be presented w ithin reasonable tim e after its last negotiation.
P ro b ate L aw . A court of probate, consisting of one judge, is
established for each county in th e S tate. T his court has jurisdiction
of the probate of wills, of granting letters testam entary and of adm in­
istration, and th e repeal of revocation of the same; of the settlem ents
of accounts of executors an d adm inistrators, of th e sale and disposition
of the real and personal pro perty belonging to, and the distribution of,
intestates’ estates. Also of the appointm ent, removal, and settlem ents
or guardians for m inors and persons of unsound m ind, the binding out
of apprentices, th e allotm ent of dower, and the partition of land belong­
ing to joint owners. A co urt of probate m ust be held a t th e court
house of each county on th e second M onday of each m onth, and the
judge may hold special or adjourned term s whenever necessary, h u t
such court m ust a t all tim es be considered open, except on Sundays,
it also keeps a record of deeds, m ortgages, and instrum ents entitled
to record.
Prom issory N o te. M ust be unconditional promise in writing to
pay on demand or a t fixed or determ inable tim e a sum certain in money
to order or bearer, and where drawn to m aker’s own order is h ot com­
plete until endorsed by him ; m ay be in installm ents.
P ro te st. (See Negotiable Instrum ents.)
P ro test o f F o re ig n B ills. M ay be m ade by n otary public or by
any respectable resident of th e place in presence of two or more credible
witnesses; bill of exchange does n ot operate to assign funds in hands
of drawee and he is not liable unless he accepts.
Replevin. W rit of replevin lies to recover property in custody of
an officer of th e law, and is lim ited to this. The action of detinue
lies to recover personal property in all other instances.
.Sales in B u lk . Sales of all or substantially all of stock of m er­
chandise except in regular course of trad e is prim a facie fraudulent
and , d against creditors unless th ey are notified in w riting prior to
the sale in m anner prescribed by sta tu te.
j .
Taxes become due October 1st, and delinquent on th e 31st of
J-'®ceniber of th e year for which th ey are levied and lands m ay be
solu by proceedings h ad in th e P robate C ourt commenced in the
month of M arch following th e due date of taxes provided th e personal
property is insufficient to pay taxes. T he rate of taxation is 6 J m ills
er sixty-five cents on each $100.00 on am ounts assessed. T his is for
«fate purposes only. M unicipalities m ay levy taxes a t th e rate of
•Jpy cents on each $ 100.00 except th a t certain nam ed municipalities
or the larger class m ay levy a larger am ount by special constitutional
provision. Counties m ay levy sim ilar am ount to, the municipalities
¡*c.ePt .that certain special taxes varying in different counties are
levied m addition. Assessments based on 60% of th e valuation of
me property. Counties m ay vote additional levies for specific
?nn??ses an(l naay secure th e sam e by bonds. The purchaser of lands
sold tor taxes receives from th e tax collector a certificate of purchase
snowing a description of th e property, the date and am ount of assessmept, the taxes, costs, an d fées, etc., and after th e expiration o f two
ï ““rs irom th e date of sale, th e purchaser m ay get a deed from th e
fiat e iff Probate. T he delinquent tax payer, has tw o years from
linn °* j e *Q which to redeem. After purchaser goes into possession
n I ^ ee<^ and keeps possession for three years recitals in the deed
“eid to be tru e and cannot be disproved. On redem ption, the
redeeming pays th e am ount of taxes for which th e land sold,
rrsis °t sale, with interest a t 16% per annum and all taxes paid sub­
sequent. to th e sale by th e purchaser w ith interest thereon a t 8 % per
anv m' W herever land is sold for state or county taxes, and from
cause such sale is invalid to pass title to purchaser, sale operates
riflvïï'nsier„to Purchaser of lien of sta te or county, on the property for
warn
, taxes for which sold. All cotton factories or cotton mills
* tie constructed in this S tate within five years shall be
from taxation for a period of ten years, provided such mills
represent an investm ent of $50,000.
wills of real or personal property m ust be in writing
Oman
» 8 testa to r and declared his last will and testam ent in the
v esence of two witnesses who m ust sign as witnesses in the presence


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1709

of testa to r and each other. U nw ritten will of personal property valid
only when th e property does n ot exceed $500 in value, and m ust be
m ade during last sickness by te sta to r a t his hom e. Persons present
m ust be called on to witness th a t it is te s ta to r’s will and m ust be
reduced to w riting by one of the wtinesses w ithin six days. M inor
over eighteen m ay m ake a will of personal property. No will effective
until probated. M ay be contested in probate or chancery court.

SYNOPSIS OF

THE LAW S OF ALASKA
R E L A T IN G TO

BANKING AND COMMERCIAL USAGES
P repared and Revised by O . D. C o c h r a n , A ttorney a t Law, Norne.
(See C ard in A ttorneys’ List.)
A ck n o w le d g m e n ts. (See Deeds.)
A ctio n s. T he distinction between actions a t law and suits in
equity and all forms of pleading heretofore existing in actions a t law
and suits in equity are abolished, and th ere is b u t one form of action,
denom inated a civil action, for th e enforcem ent or protection of pri­
vate rights and th e redress or prevention of private wrongs. Every
action m ust be prosecuted in th e nam e of th e real p a rty in interest,
except th a t an adm inistrator or executor, a trustee of an express tru st,
or a person expressly authorized by sta tu te m ay sue w ithout joining
w ith him th e person for whose benefit th e action is prosecuted; b u t
th e assignm ent of a thing in action n o t arising o u t of contract is not
authorized.
A ffidavits. Am affidavit or deposition taken out of Alaska, other­
wise th an upon commission, m ust be authenticated as follows: 1 .
I t m ust be certified by a commissioner appointed by th e governor of
Alaska to take affidavits and depositions in th e state, territory, district
or country where taken; or, 2 , it m ust be certified b y a judge of a
court of record having a clerk and a seal to have been taken and sub­
scribed before him a t a tim e and place therein specified, and the
existence of th e court, the fact th a t such judge is a m em ber thereof
and th e genuineness of his signature m ust be certified b y th e clerk
of th e court, under the seal thereof. In all affidavits or depositions
witness should speak in th e first person.
A liens. Any alien who is a bona fide resident of th e U nited States,
or who has declared his intention to become a citizen, or whose rights
are secured by treaty,.m ay acquire and hold lands upon the sam e term s
as a citizen. Any alien m ay acquire lands by inheritance or in the
ordinary course of justice in the collection of debts, and m ay acquire
and enforce liens upon lands, b u t such lands m ust be sold w ithin ten
years. Any alien m ay also acquire and hold lots or parcels of land
in any incorporated or p latted city, town, or village, or in any mine
or mining claim, b u t is n ot authorized to acquire title from th e U nited
States to any of th e public lands.
A rre st. T he defendant m ay be arrested in the following civil
actions: 1 . F or th e recovery of money or dam ages when th e de­
fendant is about to rem ove from the district w ith in ten t to defraud
his creditors; for an injury to person; or for willfully injuring or wrong­
fully taking, detaining, or converting property. 2 . F or a flue or
penalty; or for m oney or property embezzled or fraudulently m is,
applied or converted to his own use b y a public officer, or by an a tto r­
ney, or by an officer or agent of a corporation in th e course of his
em ploym ent as such, or by any agent, broker, or other person in a
fiduciary capacity or for m isconduct or neglect in office or in a profes­
sional em ploym ent. 3. To recover the possession of personal
property unjustly detained, when th e property or any p a rt thereof
has been concealed, removed, or disposed of, so th a t it cannot be
found or tak en by th e m arshal, and w ith in te n t th a t it should n o t be
so found or taken, or w ith the in ten t to deprive th e plaintiff of the
benefit thereof. 4. W hen the defendant has been guilty of frau d in
contracting a debt, or incurring th é obligation for which th e action is
brought, or in concealing or disposing of th e property for th e taking,
detention, or conversion of which th e action is brought. 5. When
the defendant, has rem oved or disposed of his property, or is about to
do so, With in ten t to defraud his creditors.
A tta c h m e n t. The plaintiff, a t th e tim e of issuing th e summons
or afterw ards, m ay have th e property of defendant attached in an
action upon a contract, express or implied, for the direct paym ent of
money, and, 1 , which is n ot secured by mortgage, lien, or pledge upon
real or personal property, or if so secured, when th e security has been
rendered nugatory by th e act of the defendant; or, 2 , against a non­
resident defendant. T he w rit issues whenever th e plaintiff, or any­
one m his behalf, files an affidavit showing th a t defendant is indebted
to plaintiff- (specifying th e am ount of indebtedness over and above all
legal set-offs or counter-claims) upon a contract, express or implied,
for the direct paym ent of m oney; th a t th e paym ent has not been
secured by m ortgage, lien, or pledge upon real or personal property;
and th a t th e sum for which attachm ent is asked is an actual, bona fide
existing debt due and owing from plaintiff to defendant; and th a t th e
attachm ent is n ot sought nor th e action prosecuted to hinder, delay,
or defraud an y creditor of th e defendant. Plaintiff m ust also file an
undertaking, w ith one or more sureties, in a sum not less than $ 100 ,
and equal to th e am ount for which he dem ands judgm ent, conditioned
th a t plaintiff will pay all costs adjudged and all damages sustained
by reason of th e attachm ent if th e sam e be wrongful or w ithout suffi­
cient cause, not exceeding th e am ount specified.
C h a tte l M o rtg a g e s. Any interest in personal property, capable
of being transferred, m ay be m ortgages; b u t the m ortgage 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 th e m ortgager or th e m ortgage provide th a t th e
property m ay rem ain in th e possession of th e m ortgagor and be ac­
companied by the affidavit of all th e parties thereto th a t the same is
made in good faith to secure the am ount nam ed therein, and without
design to hinder, delay, or defraud creditors, and be acknowledged
and filed. The m ortgage m ust be acknowledged by the m ortgagor
as a conveyance of real property is and be filed in th e office of th e
recorder of th e precinct where th e m ortgagor resides and of the pre­
cinct where th e property is. W ithin th irty days next preceding th e
expiration of one year from th e filing, a true copy of th e m ortgage,
with a verified statem ent of the interest of th e mortgagee in th e prop­
erty a t th e tim e th e sam e is renewed, m ust be filed in th e office where
the original was filed, and the lien is thereby extended another year.
C hattel m ortgages are foreclosed in the sam e m anner as m ortgages
and liens upon real property, b u t a clause m ay be inserted in a m ortgage
authorizing th e m arshal to execute the power of sale therein granted
to th e m ortgagee.
C o rp o ra tio n s. Domestic Corporations. T hree or more adult per­
sons, bona fide residents of th e district, m ay form a corporation for
the following purposes: To construct, own, and operate railroads,

1710

BA N K IN G AND COM M ERCIAL LAWS—ALASKA

tram w ays, street railways, wagon roads, flumes, and telegraph and
telephone lines In A laska; to acquire, hold, and operate m ines in
Alaska; to carry on th e fishing industry in Alaska and the waters
adjacent and contiguous thereto; to construct and operate smelters,
electric and other power and lighting plants, docks, wharves, elevators,
warehouses, and hotels in Alaska; and to carry on trade, transporta­
tion, agriculture, lumbering, and m anufacturing in Alaska.
Foreign Corporations. E very corporation or joint stock com pany
organized under th e laws of th e U nited States or any sta te or territo ry
shall, before doing business within th e district, file in th e office of the
secretary of the district and in th e office of th e clerk of th e district
court for th e division wherein it intends to carry on business a duly
authenticated copy of its ch arter or articles of incorporation, and also
a statem ent verified by th e oath of its president and secretary and
attested b y a m ajority of its board of directors. T hereafter such
statem ent m ust also be so filed w ithin th irty days after Ju ly first of
each year.
D eed s. A conveyance of lands, or of any estate or interest therein,
m ay be m ade by deed, signed and sealed by th e person from whom
the estate or interest is intended to pass, and acknowledged or proved,
and recorded, w ithout any other act or ceremony. A quit-claim deed
passes all th e estate which the grantor could convey by deed of bargain
and sale. N o covenants are im plied in any conveyance. The term
“ heirs," or other words of inheritance, are n ot necessary to create or
convey an estate in fee simple. H usband and wife m ay, b y their .
joint deed, convey th e real estate of th e wife, in like m anner as she
might, do by her separate deed if she were unm arried. A m arried
woman residing in the district, joining her husband in a deed, m ust
acknowledge th a t she executed such deed freely and voluntarily.
When a m arried woman n ot residing in the district joins her husband
in conveying real estate situ ate in th e district, the conveyance has the
sam e effect as if she were sole, and th e acknowledgm ent or proof of the
execution m ay be m ade th e sam e as if she were sole. W ithin the
district deeds m ust be executed in th e presence of two withesses, who
shall subscribe their nam es as such; and th e person executing a deed
m ay acknowledge the execution before a judge, clerk of th e district
court, notary public, or commissioner within th e district, and the
officer taking the acknowledgment m ust indorse thereon a certificate
of acknowledgm ent and the tru e date of m aking th e sam e under his
hand.
D e p o s itio n s . 1 T he testim ony of a witness, in th e district, m ay be
taken by deposition, in an action, a t any tim e 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 p a rty to th e action or proceeding, by th e opposite p arty ; 2 , the
witness's residence is more th an one hundred miles from the place of
trial; 3, th e witness is about to go more th an one hundred miles beyond
the place of trial; 4, the witness is too infirm to atten d the trial; or, 5,
the testim ony is required upon a motion, or in any other case where
the oral exam ination of th e witness Is n ot required.
T he testim ony of a witness, out of th e district, m ay be taken by
deposition, by commission issued, upon five days’ notice to th e other
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 th ey do not
agree, to a judge, justice of th e peace, notary public, or clerk of a
court selected by th e officer issuing th e commission.
T he am ount of the commissioner’s fees should be indorsed upon the
deposition.
D e sc e n t a n d D is tr ib u tio n . The real property of an intestate
descends as follows: 1. In equal shares to his or her children and
to th e issue of any deceased child by right of representation; and
if there be no child of intestate living a t th e tim e of his or her death,
to all his or her other lineal descendants; and if all such descendants
are in the sam e degree of kindred to the intestate, th ey take equally;
otherwise, by representation. 2. If in testate leave no lineal descend­
ants, to his wife; or if in testate be a m arried woman, to her husband;
add if in testate leave no wife nor husband, to his o r her father. 3.
I f in testate leave no lineal descendants, neither husband nor wife,
nor father, such real property descends in equal shares to his brothers
and sisters, and to th e issue of any deceased brother or sister by
right o f representation; b u t if in testate leave a m other, she takes
an equal share w ith such brothers and sisters. 4. If intestate leave no
lineal descendants, neither, husband nor wife, nor father, brother
nor sister, such real property descends to his m other, to th e exclusion
of th e issue of deceased brothers and sisters. 5. If intestate leave
no lineal descendants, neither husband nor Wife, nor father, m other,
brother, nor sister, such real property descends to his next of kin
in equal degree, excepting th a t when there are two or m ore collateral
kindred in equal degree b u t claiming through different ancestors,
those who claim through the nearest ancestor are preferred. 6 . If
intestate, leave one or more children, and the issue of one or more
deceased children, and any of such surviving children die under
age w ithout haying been m arried, al! such real property th a t came
to such deceased child by inheritance from such intestate descends
in equal shares to th e other children of such intestate and to th e fssue
of any other children who have died, by right of representation. B ut
if all th e o ther children of in testate be dead, and any of them have
left issue, such real property so inherited by such deceased child
descends to all the issue of such other children of th e in testate in
equal shares, if th ey are in th e sam e degree of kindred to such deceased
child; otherwise, th ey take by right of representation. 7. I f intes­
ta te leave no lineal descendants or kindred, such real property escheats
to th e U nited States.
D ow er a n d C u rte s y . T he widow of every deceased person is
entitled to dower, or th e use during her n atu ral life of one-third p a rt
in value of all-the lands whereof her husband died seized of an estate
of inheritance.
W hen any m an and his wife are seized in her right of any estate of
‘
inheritance in lands, th e husband, on the death of his wife, holds the
lands for his life as te n a n t thereof by the curtesy, although such
husband and wife m av not have had issue bom alive.,
E v id en ce. N o person m ay be excluded as a witness on account of
being a p a rty or interested in th e event of an action or proceedings,
having been convicted of a crime, or his opinions on m atters of religious
belief. Persons of unsound m ind and children under ten years of age
who appear incapable of receiving ju st impressions of th e fact respect­
ing which th ey are examined or of relating them tru ly m ay not be
witnesses. An attorney m ay not, w ithout his client’s consent, be
exam ined as to communications m ade by his client to him or his advice
thereon. A priest m ay not, w ithout the consent of th e person m aking
th e confession, be exam ined as to any confession m ade to him in his
professional capacity, in th e course of discipline enjoined b y the church
to which he belongs. A physician or surgeon m ay not, against the
objection of his patient, b e examined, in a civil action, or proceeding,
as to inform ation acquired in attending the p atien t which was neces­
sary to enable him to prescribe or act.
E x e c u tio n s. (See Judgm ent and Execution.)
E x e c u to rs a n d A d m in is tr a to rs . W hen a will is proven letters
testam en tary are issued to th e persons therein nam ed as executors,
or to such of them as give notice of th eir acceptance of the tru st and
are qualified. A dm inistration is granted as follows: 1. To th e widow
or next of kin, or both, in th e discretion of th e court; 2. To one or
m ore o f th e principal creditors; or, 3, to any other person com petent
and qualified whom th e court m ay select. If deceased were a m arried
woman adm inistration shall in any case be granted to th e husband;
if qualified, and he apply therefor. Claims are paid in the following
order: 1. Funeral charges. 2. Taxes dUe the U nited States. 3.
Expenses of last sickness. 4. All other taxes. 5. D ebts preferred
by th e laws of th e U nited S tates. 6 . D ebts which a t th e death of
th e deceased were a lien upon his property, in th e order of the priority
of th e liens. 7. D ebts . due for wages earned within ninety days
im m ediately preceding death of decedent. 8 . All other claims.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

E x e m p tio n s . 1. Earnings of judgm ent debtor, for personal ser­
vices rendered within sixty days next preceding th e levy of execution
or attachm ent, when necessary for th e use of his fam ily supported
in whole or in p a rt by his labor. 2. Books, pictures, and musical
instrum ents owned by an y person, to th e value of $75. 3 . Necessarv
wearing apparel owned by any person for the use of himself or family
b u t w atches or jewelry exceeding $100 in value are not exempt
4. T he tools, implements, apparatus, team , vehicle, harness, or librai
ry necessary to enable any person to carry on th e trade, occupation
or profession by which such person habitually earns his living, to thè
value of $500; also sufficient q u antity of food to support such team
if any, for six m onths; the word “ te a m ” being construed to includè
not more than one yoke of oxen, or a span of horses pr mules, or two
reindeer, or six dogs. 5. The following property, if owned by the
head of a fam ily and in actual use or kep t for use by and for his family
or when being rem oved from one habitation to another on a changé
of residence: Ten sheep, w ith one year’s fleece or th e y am or cloth
m anufactured therefrom ; two cows and five swine; household goods
furniture, and utensils to th e value of $300; also food sufficient to
support such animals, if any, for six m onths, and provisions actually
provided for fam ily use and necessary for the support of such person
and fam ily for six m onths. 6 . T he seat or pew occupied by the head
of a fam ily or his fam ily in a place of public worship. 7. All property
of any public or municipal corporation. No article, or th e proceeds
derived from its sale or exchange, is exem pt from execution on a
judgm ent recovered for its price.
G a r n is h m e n t. (See A ttachm ent.)
H o lid ay s. T he law concerning legal holidays in th e Territory
has been amended to read as follows:
T he following days are legal holidays, nam ely: Sunday, the first
day of January, Commonly called New Y ear’s D ay; th e 12th day of
F ebruary, commonly called Lincoln’s B irthday; th e 22nd day of
February, commonly called W ashington’s B irthday; th e 30th day
of M arch, to be called Sew ard’s D ay In comm em oration of the sign­
ing of th e T reaty, ceding Alaska to th e U nited S tates; the 4th day
of July, commonly called Independence D ay; th e first Monday in
Septem ber, commonly called Labor D ay; th e 18th day of October,
commonly called Alaska D ay: the 25th day of December, commonly
called C hristm as D ay: and any day designated by public proclama­
tion by th e President of the U nited S tates or th e Governor of the
T erritory of Alaska, as a legal holiday, or as a day of Thanksgiving;
the day known and observed as M em orial or Decoration D ay and thé
day on which a general election is held throughout th e Territory
of Alaska.
H o m e s te a d . T he homestead, of any fam ily, or th e proceeds
thereof, is exem pt. Such hom estead m ust be the. actual abode of,
and owned by, such fam ily or some m em ber thereof, and not exceed
$2,500 in value nor exceed 160 acres in extent, if n o t located in a town
or city laid off into blocks or Jo ts; or if located in an y such town or
city, one-fourth of an acre. This exem ption does not apply to decrees
for the foreclosure of any m ortgage property executed; but if the
owners of such hom estead be m arried, th e m ortgage m ust be executed
by husband and wife.
I n te r e s t. The legal rate of in terest is 8 per cent, b u t on contract
interest a t the rate of 12 per cent m ay be charged by express agree­
m ent of th e parties. I f usurious interest has been received or collected
th e p a rty paying the same, or his legal representatives, may, by action
brought within two years, recover double th e am ount of such interest.
I f it is ascertained in an y action upon contract th a t an unauthorized
rate of interest has been contracted for, judgm ent m ust be rendered
against the defendant for the am ount due, w ithout interest, ana
against the plaintiff for costs. I f the rate contracted for is 8 per
cent or less, the debtor m ay also agree to pay th e taxes upon the
debt, credit, or m ortgage.
J u d g m e n t a n d E x e c u tio n . A judgm ent is docketed imme­
diately after entry. A t any tim e th ereafter while execution may
issue a certified transcript of th e docket m ay be filed in the office
of the recorder of any recording district, and from th e d ate of docket­
ing a judgm ent or transcript thereof the judgm ent is a lien upon
all th e real property of th e defendant within th e recording district
or districts where docketed, or which he m ay afterw ards acquire ,
therein during th e tim e an execution m ay issue. I f no execution
issues within ten years the lien expires, b u t is renewed if afterwards
leave is given to issue execution and a transcrip t of th e docket of
the order docketed w ith the recorder.
Execution m ay issue a t any tim e within five years from the entry
of th e judgm ent, and thereafter on order of th e court m ade on motion
of the p a rty in whose favor the judgm ent was given. Such motion
m ust be subscribed and verified as a com plaint, and summons must
be served upon the judgm ent debtor or his representatives, to which
he or th e y m ay dem ur or answer. The order m ade m ust be dock­
eted as a judgm ent. Execution m ay be against th e property of the
Judgm ent debtor, his person, or for th e delivery of th e possession
of real or personal property, or such delivery w ith damages. Execu­
tion from the district court is returnable w ithin sixty days; from the
commissioner's court w ithin th irty days. Until a levy property is
not affected by th e execution.
L icen ses. (See Taxes.)
L ie n s. E very mechanic, artisan, m achinist, builder, contractor,
lum ber m erchant, laborer, team ster, draym an, and other person
performing labor upon or furnishing m aterial of any kind to be used
in the construction, developm ent, alteration, or repair, either in whole
or in p art, of any building, wharf, bridge, flume, ditch, mine, tunnel,
fence, m achinery, or aqueduct, or any structure or 'superstructure,
has a lien upon the same for th e work or labor done or material fur­
nished a t the instance of th e owner o f th e building or other improve­
m ent or his agent; and every contractor, sub-contractor, architect,
builder, or other person having charge of th e work, in whole or in
part, is, for this purpose, deem ed the agent of th e owner.
L im ita tio n s . Civil actions m ust be commenced within the
following periods after the cause of action accrued: Within ten
years—action for the recovery of real property, or th e possession
thereof; upon a judgm ent or decree of any court o f th e United States,
or of any sta te or territo ry w ithin th e United States; upon a sealed ,
Instrum ent. W ithin six years—action upon a contract or liability,
express or implied, except judgm ent or sealed instrum ent; upon a
liability created by sta tu te, other th an 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
W ithin three years—action against a m arshal, 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-paym ent of money collected upon execution, b u t not an
action for an escape; action upon a sta tu te for penalty or forfeiture,
where the action is given to the p a rty aggrieved, or to such .party
and the United States, except the sta tu te prescribe a different limita­
tion. W ithin two years— action for libel, slander, assault, battery,
seduction, false im prisonm ent, or for any injury to the person or
rights of another not arising on contract; upon a sta tu te for a forfeiture o f penalty to the U nited States. AVithin one year—action
against th e m arshal or other officer for th e escape of a person arrestea
or imprisoned on civil process; upon a sta tu te for th e penalty given
in whole or in p a rt to th e person who will prosecute, b u t if not com­
menced within one year by private p arty m ay be within two years
by the United States.
M a rrie d W o m en . The property and pecuniary rights of every
m arried woman a t th e tim e of m arriage, or afterw ards acqunem
by gift, devise, or inheritance, or by h er own labor, are n ot subject
to the debts or contracts of her husband, and she m ay manage, sen,
convey, or devise th e sam e by will to th é same extent and m rne
same m anner th a t her husband can property belonging to him. rot
civil injuries dam ages m ay be recovered from à m arried woman

BA N K IN G A ND COM M ERCIAL LAWS—ARIZONA
alone, and h er husband Js not responsible therefor. C ontracts m ay
be made by a wife, and liabilities incurred, and th e sam e enforced
by or against h er to th e same extent and in th e sam e m anner as if
she were unm arried. All laws which impose or recognize civil disa­
bilities upon a wife which do not exist as to th e husband are repealed.
Wife m ay record list of her property and such list is prim a facie
evidence of h er separate ownership, and property not so registered
is deemed prim a facie th e property of th e husband. N either husband ;
nor wife is liable for th e debts or liabilities of th e other incurred 1
before m arriage. Husband and wife m ay m ake conveyances and •
transfers and create liens betw een themselves, and either m ay con­
stitute th e other his or h er atto rn ey in fact. A woman becomes of
age at tw enty-one or upon being m arried according to law.
M o rtg ag es, M ortgages are executed, acknowledged, and recorded
In the same m anner as deeds. N o covenant is im plied for th e pay­
ment of th e sum intended to be secured. Record of assignm ent is
not notice to th e m ortgagor, his heirs; or personal representatives.
Mortgage m ay be discharged by en try in m argin 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 n atu re in which a deficiency judgm ent m ay be had.
N otes a n d B ills o f E x c h an g e. On all bills of exchange and
all negotiable promissory notes, orders, and d rafts payable a t a
future day certain w ithin th e district, grace is allowed; b u t grace
is not allowed on bills of exchange, notes, or drafts, payable a t sight
or on dem and.
R ecords. 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 w ith th e clerk of th a t divi­
sion of th e district court within the lim its of which such lands are
situated.
R eplevin. The- plaintiff, a t any tim e after the com m encement
of an action to recover th e possession of personal property and before
judgment, m ay claim th e im m ediate delivery of such property upon
filing an affidavit showing th a t he is the owner of the same or entitled
to the possession thereof; th a t the property is unlawfully detained
by defendant; th e alleged cause of detention; th a t the same has not
been taken for a tax assessm ent or fine, pursuant to a sta tu te, or
seized under an execution or attachm ent against th e property of
the plaintiff; or, if so seized, th a t it is exem pt; and th e actual value
of the property.
Service. (See Actions.)
S u p p le m e n ta ry P ro c e e d in g s. (See Judgm ent and Execution.)
Taxes. E very person or corporation prosecuting or attem pting
to prosecute any. of th e following lines of business w ithin th e district
must first apply' for and obtain license so to do from th e district
court or a subdivision thereof, and pay per annum for such license
for the respective lines of trad e and business as follows: Salmon
canneries, 4 cents per case; salmon salteries. 10 cents per barrel;
fish oil works, 10 cents per barrel; fertilizer works, 20 cents per ton;
freight and passenger transportation lines, propelled by mechanical
power on inland w aters a n d ocean and coastwise vessels doing local
business for hirel, $1 per ton on net tonnage; railroads, $100 per
mile; tram ways, $10 p er mile; saw-mills, 10 cents per thousand feet
on lum ber sawed; quartz mills, $3 per stam p; m ercantile establish
ments and m anufactories doing a business of under $4,000 per annum ,
$10, and in proportion to the am ount of business done to $500 for
establishments doing a business of $ 100,000 per annum ; in other lines
of trade and business th e am ount is fixed for each and ranges from
$10 to $500.
W ills. E very person of tw enty-one years of age, of sound m ind,
may dispose of all his or her property by will, saving a widow’s dower
and a husband’s rights as ten an t by th e curtesy. Will m ust be In
writing, signed by th e testato r, or under his direction, in his presence,
and attested by two or more com petent witnesses subscribing their
names in th e presence of th e testato r. A will by an unm arried person
is revoked by his subsequent m arriage. Children or descendants
of children n o t nam ed or provided for in th e will take as if testato r
had died in testate. A m ariner a t sea or soldier in m ilitary service
may dispose of his personal property as a t common law. Proof
of nuncupative will m ust be m ade w ithin six m onths, and th e words
or their substance reduced to writing within th irty days after they
are spoken. A person owning property in, b u t n o t an inhabitant
of. the district m ay devise or bequeath th e same according to the
laws of his domicile. I f such will be probated without th e district,
copies of th e will and th e probate thereof, certified by th e clerk of
the court in which it was probated, with th e seal of the court affixed
thereto, if there be a seal, together w ith a certificate of th e chief
judge or presiding m agistrate, th a t the certificate is in due form,
and made by th e clerk or other person having th e legal custody
of the record, m ay be recorded, adm itted in evidence, or contested
and annulled as if executed and proved w ithin the district.

SYNOPSIS OF

THE LAW S OF ARIZONA
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by C. B. W il s o n , A ttorney a t Law,' Flagstaff, Arizona.
A cco u n ts. "When stated draw interest; when action is upon
itemized account and affidavit of p arty, his agent or atto rn ey is
attached, stating th a t such “ account is, within affiant’s knowledge,
lust and true, th a t it is due, and th a t all ju st and lawful offsets,
claimants, and credits have been allowed,” is prim a facie evidence,
unless one day before trial, defendant files w ritten denial of any item
under oath.
A ck n o w led g m en ts. T he form of an ordinary certificate of ac­
knowledgment shall be substantially as follows:
“ State of Arizona,
1
County o f........................... .................. .............................. J 88
This instrum ent was acknowledged before me t h i s . . . . . __ day
?r - • ............ A. D ................... .., by (if by a natural person or persons
uere insert nam e or names; if by a person acting in a representative
or official capacity, .or as attorney in fact, th en insert nam e of person
as executor, attorney in fact, or other capacity; if by an officer or
officers of a corporation, then insert nam e or nam es of such officer
or officers as th e president or other officer of such corporation, naming
it).
,
A.
. . . . . . . ...... .......... b ......................................
N otary Public.
(Or other officer)
Uvly commission expires.........


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1711

E very instrum ent affecting real property in this sta te executed,
acknowledged and certified in any other sta te or territo ry in accord­
ance w ith the laws of such sta te or territory, shall be valid an d en­
titled to record as if executed in accordance w ith the laws of this
state.
A ctio n s. D istinction in forms between law and equity are abol­
ished. Pleadings are: Com plaint and answer, and in some cases a
reply.
A d m in is tr a tio n of E s ta te s . Lie in Superior C ourt. No public
adm inistrator. W here person dies intestate letters shall issue.
A ffidavits. M ay be taken before any officer authorized to take
acknowledgments.
A liens. Unless rights are secured by treaty cannot hold land in
the state, m ay acquire by inheritance, or in ordinary course of jus­
tice in th e collection of debts; m ay acquire liens on real estate, m ay
lend money and secure same on real estate, b u t title so acquired m ust
be sold within five years; m ay acquire patented m ines and hold
stock in dom estic corporation owning unpatentèd mines.
!
The laws provide th a t th e laws of th e sta te pertaining to aliens
shall n ot be construed as to conflict in any m anner w ith any rights
existing under and by virtue of any tre a ty of th e U nited States with
any other country.
A ppeals. Appeals are allowed from justice of peace to superior
court in certain cases and from superior court to suprem e court
where am ount involved is $200 or over.
A r b itra tio n . T here are sta tu to ry provisions which are not
exclusive of the common law arbitration.
A rre s t. Abolished in civil cases, debtor fraudulently removing
P roperty out of territo ry or concealing it m ay be prosecuted criminally.
A tta c h m e n t. W rit will issue on affidavit showing: 1. T h at
defendant is indebted to plaintiff upon a contract, express or implied;
for th e direct paym ent or money and th a t such contract was m ade Or
is payable in this T erritory, and th a t the paym ent of the sam e has not
been fully secured by m ortgage, lien, or pledge of personal property,
or if originally so secured, th a t such security has, w ithout any act of
plaintiff or the person to whom th e security was given, become value­
less, and shall specify the character of the indebtedness, th a t th e same
is due to the plaintiff over and above all legal set-offs or counter-claims',
and th a t dem and has been m ade for the paym ent of am ount due; or,
2 . T h at defendant is indebted to plaintiff, stating am ount and char­
acter of debt; th a t samè is due and payable over and above all legal
set-offs and counter-claims, and th a t defendant is a non-resident of
this T erritory or is a foreign corporation doing business in th is T erri­
tory; or, 3. T h at an action is pending between th e parties, and th a t
defendant is about to remove his property beyond the jurisdiction of
the court to avoid paym ent of judgm ent; and, 4. T h a t th e attach ­
m ent is n ot sought for a wrongful or, malicious purpose, and that the
action is not prosecuted to hinder or delay, any creditor of defendant.
5. No such attach m en t shall issue until suit has been duly instituted,
b ut it m ay be.issued in a proper case either a t the commencement of
th e suit or a t any tim e during its progress. 6 . The w rit m ay issue,
although plaintiff’s debt or dem and be not due under specified facts of
intent to defraud ; no final judgm ent shall be rendered until such debt
or dem and shall become due. W rit m ay issue a t or after action began
upon plaintiff or some one in his behalf filing th e affidavit, and upon
filing a bond w ith tw o sureties in an am ount equal to am ount sued for.
Sureties can be compelled to justify upon notice. W hen more than
one attachm ent is levied on same property writs take priority accord­
ing to tim e of levy. (See Liens, Garnishm ent.)
B a n k s— S avings a n d L o a n . M ay be incorporated to loan and
invest property. M ay hold lot and building in which business is
carried on to value of $ 100 ,0 0 0 ; such as m ay accum ulate on good
faith loans and such personal property as m ay be required in tran s­
acting its business. To purchase and convey evidence of debt except
national, territorial, and municipal bonds m ust have a capital of
$100,000. M arried women and minors m ay tran sact business with
such banks. Are required to have license and are examined by the
bank examiner. Provisions are m ade for the contents of th e charter.
B ills a n d N o te s. T he negotiable instrum ent code adopted by the
American B ar Association is in force. Joint obligor m ay be released
w ithout releasing others. (See Holdings.)
B o n d s. Any standard surety com pany, organized under laws of
United S tates or of any state, m ay execute bonds in judicial proceed­
ings within the sta te when they have complied w ith license laws.
(See G uaranty Companies.) :
C h a tte l M o rtg ag e. To be valid against others th an th e parties
thereto, chattel m ortgage m ust set o ut th e residence of the mortgagor
and the mortgagee, th e rate of interest to be paid and tim e and place of
paym ent of the debt secured, and be accompanied by th e affidavit of
both m ortgagor and .mortgagee th a t the m ortgage is bona fide and
m ade w ithout design to defraud or delay creditors. Im m ediate
delivery of the m ortgaged property m ust be m ade to the mortgagee
and the change of possession m ust be actual and continued, unless the
m ortgage or a tru e copy thereof shall be forthw ith deposited and filed
in the office of the recorder of the county where th e property shall
then be situated. Removal sale, or other disposition of mortgaged
property w ithout consent of m ortgagee entitles mortgagee to imme­
diate possession of it, and such removal, transfer, or sale, or subsequent
encum brance is felony. I f m ortgagee perm its m ortgaged property to
be rem oved tq another county, he shall w ithin one m onth record his
m ortgage in such o ther county. C hattel m ortgage m ay be fore­
closed in justice court if am ount of debt does n ot exceed $300 ; other­
wise in superior court. M ortgagee m ay obtain possession of property
on default and sell after notice which m ust be served on owner. Upon
stock of goods, wares, and merchandise with continued possession in
m ortgagor, void. I f copy is filed w ith recorder, original m ust be
acknowledged, and copy certified to by county recorder.
C la im a n d D elivery. (See Replevin.)
C o lla te ra ls. N o sta tu to ry provisions— common law prevails.
C o m m u n ity P ro p e rty . (See Conveyances.)
C o n d itio n a l S ales. W here title rem ains in vendor until purchase
price is paid, void as to persons not parties thereto, and persons
w ithout notice, unless subscribed, acknowledged, and filed with
county recorder.
C o n tr a c ts . (See Bills and Notes.) One or more obligors on a
joint or joint and several instrum ent m ay be released w ithout releasing
the others, and m ay be sued separately under certain conditions with­
out releasing th e others. M arried women m ay contract as if sole.
C on v ey an ces. Conveyances of estate in lands for term more th an
one year shall be b y instrum ent in writing subscribed b y p a rty m aking
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 lanci is situate. A conveyance
purporting to convey a greater estate th an the grantor has passes only
the estate th a t he actually has. A general grant or devise passes the
fee unless expressly lim ited to a less estate. All deeds to realty m ust
be signed by both husband and wife except as to uripatented mining
claims. Deeds m ust be signed and m ust be acknowledged before
some officer authorized to take acknowledgment, and properly cer­
tified by him to entitle same to registration. T he use of th e word
" g r a n t” or “ convey” implies the following covenants and none
other: 1. T h a t previous to the tim e of the execution of the con­
veyance th e grantor has not conveyed the sam e estate, or any right,
title or interest therein, to any person other th an th e grantee. 2 .
T h at such estate is a t the tim e of thè execution of such conveyance
free from incumbrances. M arried women seventeen years of age
and upward m ay convey their own lands w ithout being joined by
their husbands. (See Acknowledgment, Dower, H usband and Wife,
Homestead.)

1712

BA N K IN G A ND COM M ERCIAL LAWS—ARIZONA

C o rp o ra tio n C o m m is sio n , organized under C hapter 90, F irst
Session, Laws 1912. H as general supervision of corporations.
C o rp o ra tio n s i n G e n e ra l. Any num ber of persons m ay become
incorporated for th e transaction of any lawful business. Before com­
mencing an y business, th ey m ust adopt articles of incorporation
which shall be signed and acknowledged b y them as deeds and be
Sled in th e office of the Corporation commission a t th e S tate C apital
an d a certified copy thereof filed in the office of th e C ounty Recorder,
in each county in th e sta te in which th ey tran sact business. The
articles of incorporation m ust contain: 1. The nam e of corpo­
rators, and its principal place of transacting business. 2. T he general
n atu re of th e business proposed to be transacted. 3. T he am ount of
capital stock authorized and th e tim es when and conditions upon
which it is to be paid in. 4. T he tim e of th e comm encem ent and
term ination of th e corporation. 5. By w hat officers or persons the
affairs o f th e corporation are to be conducted, and the tim es a t which
th ey are to be elected. 6 . T he highest am ount of indebtedness or
liability to which th e corporation is a t any tim e to subject itself, which
m ust n o t exceed tw o-thirds of its capital stock. 7. W hether private
property is to be exem pt from corporate debts. Unless so exem pted
stockholders are liable for th e debts of th e corporation in th e pronortion which their stock bears to th e whole capital stock. M ust
be published for six days in some newspaper in th e county where
th e principal business is located. P roof of publication m ust be filed
w ith th e Corporation Commission. Corporations to endure for
twenty-five years. Corporation m ust file in office of Corporation Com­
mission an appointm ent of agent who is a bona fide resident of this
sta te for th ree years prior thereto, on whom all notices and process,
including summons, m ay be served and constitutes personal service.
Charges for incorporation : R ecorder’s fees, 20 cents folio. Recorder’s
fees, certified copy, 20 cents folio. R ecorder’s fees certificate to copy,
75 cents. C orporation Commission’s fees, filing cost copy, $ 10 .
P rin ters’ fees per inch, publishing articles six days, 80 cents. Corpo­
ration Commission’s fees, filing: proof, publishing $3.00. Corporation
Commission’s fees, filing appointm ent of agent, $5.00. W here charter
provides assessm ents m ay be levied on shares to p ar value (1907).
C o rp o ra tio n s , F o re ig n . Before it can transact business it m ust
file certified copy of Articles w ith Corporation Commission and
county recorder in county of principal place of business, also an
appointm ent of agent upon whom a service personal to th e corporation
m ay be m ade.
C o rp o ra tio n s , I n s u r a n c e . M ay be organized under provision
peculiarly applicable to insurance cbmpanies.
C o rp o ra tio n s , R a ilro a d . Are organized under a s ta tu te espe­
cially providing for them .
C o rp o ra tio n s , S av in g s a n d L o a n . (See Banks and Banking.)
C o r p o r a tio n S to c k , T ra n s fe r of. T ransfer of stock shall n ot be
valid, except as betw een th e p arties thereto, until the sam e is regularly
entered upon th e books of th e com pany, so as to show th e nam es of the
person b y whom and to whom th e transfer is m ade; th e num ber of their
designation of th e shares, and th e date of th e transfer. •
C o sts. Plaintiffs who are non-residents, or those who own no
property upon which execution m ay be levied, are required to give
security for, w ithin te n days after order m ade; bonds' for, m ust
authorize judgm ent to be entered against sureties.
C o u rts . Are th e Supreme C ourt of the S tate, th e U. S. district court
for th e D istrict of Arizona; one superior court for each County, except
in counties having over certain population in which event two superior
courts, justices of th e peace, police courts, recorders of cities. The
superior court of th e several counties is a court erf general jurisdiction,
b o th civil and crim inal. I t has both original and appellate jurisdiction.
I ts original jurisdiction extends to all civil cases where th e am ount
involved exceeds $200 exclusive of interest, and in all cases involving
th e title to or possession of real estate. Justice courts have general
jurisdiction when am ount in controversy does not exceed $200 .00 ,
except when title to real estate is involved. (See Jurisdiction.)
C re d ito rs ’ B ills. No sta tu to ry provisions.
B a y s o f G ra c e . None.
D e p o s itio n s . M ay now be tak en either upon oral exam ination,
and cross-exam ination or upon w ritten interrogatories and cross
interrogatories, as is generally provided.
D e sc e n t a n d D is tr ib u tio n . (See Savings Banks.) T he law of
com m unity property prevails. T he separate estaté of an intestate,
when he or she shall die leaving surviving no husband or wife, shall
descend as provided. W hen an intestate leaves surviving a wife or
husband another m ethod is provided. Children of th e in testate
brothers, sisters, uncles and aunts, tak e per capita. All property
belonging to th e com m unity estate of th e husband and wife shall go
to th e survivor, if th e deceased spouse have no child or children; if
th e deceased have a child or children, his or her surviving spouse 'will
tak e one-half, and th e o th er half goes to such child or children. The
com m unity property always passes charged w ith th e debts against
it. Interm arriage betw een m an and woman to whom a child or
children had before been born, and recognition by the fath er of such
child or children legitim izes th e child or children. B astards inherit
from th e m other and transm it estates as if legitim ate. T he sta tu te
provides-for th e adoption of heirs. (See Dower, H usband and Wife,
Hom estead.)
D ow er. Dower is abolished.
E v id en ce. T he common law rules have n ot been codified. P arties
m ay be exam ined and th e o ther side n ot concluded thereby. S tatutes
of other states and territories purporting to be printed under authority
m ay be read. N o one is incom petent to testify because of religious
belief. Certified copies of all records in territo ry m ay be read. C erti­
fied copies of records of all notaries m ay be read. C ourt m ay order
inspection o r copy of docum ents.
E x e c u tio n s. Upon a judgm ent of superior court, executions m ay
be issued to an y county. Lien of dates from levy, and if on real prop­
erty , th e description is endorsed on execution and filed w ith county
recorder. A range levy m ay be m ade upon all of stock under a certain
brand in sam e m anner as upon real estate. (See Judgm ent, Liens.)
Proceedings supplem ental to execution—when returned unsatisfied
creditor is en titled to an order requiring debtor to answer concerning
his property, b u t n ot elsewhere th an in th é county of his residence.
T hird p arties m ay, upon affidavit, be required to surrender property.
C ourt or judge m ay order suit brought to determ ine th e denial of
owning o r of having property.
E x e m p tio n s . E v ery person who is th e head of a family, and
whose fam ily resides w ithin this sta te , m ay hold as a hom estead,
exem pt from attachm ent, execution an d forced sale, real property
to be selected b y him or her, which hom estead shall be in one com­
pact body, n o t to exceed in value four thousand dollars, upon filing
affidavit designating such 'hom estead in th e Office of the County
Recorder on county where property is situated. Such hom estead
exem pt from date of filing said affidavit. The following property
shall be exem pt from execution, attachm ent, and sale on any process
issued from any court: 1. T he fam ily bible. 2. A sèat or pew in
an y house or place of public worship. 3. A lo t in any burial ground.
4. N ecessary household, table and kitchen furniture, including viz:
5. T he tools or im plem ents of a mechanic or artisan necessary to
carry on his trade, etc. 6 . T he sewing m achine and im plem ents
of a seam stress actually used in pursuing her vocation. 7. One
watch, one sewing machine, one typew riting m achine, and one bi­
cycle. 7a. Five milch cows. 8 . T he cam ping outfit of every
prospector in this state, including his m ining tools, saddles and burros.
9. T he fa rm in g utensils and im plem ents of husbandry of th e debtor,
etc. 10. P oultry n ot exceeding in value twenty-five dollars. 11.
Two horses and tw o m ules and th eir harness; one c art or wagon;
one d ray or truck; one coupe; ohe hack or carriage for one or two


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

horses or one autom obile by th e use of which a carm an, drayman
truckm an, huckster, hackm an, team ster, chauffeur, or other laborer
habitually earns his living, and one horse w ith vehicle or harness or
other equipm ent used by a surgeon, physician, constable or clergyman
in th e legitim ate practice of his profession, w ith food for such horses
or mules for one m onth. 12. Fuel necessary for th e use of the
debtor and his fartiily for th e period of six m onths. 13. The presses
stones, type, cases and other tools and im plem ents used by any
person or copartnership in printing or publishing a newspaper or in
0 conducting any printing establishm ent or by any person hired to use
them ; n ot exceeding tw o thousand dollars in value; together with
stock in trad e n ot exceeding four hundred dollars in value. 14. The
library and philosophical and chemical or other ap p aratu s belonging
to and used for th e instruction of youth in any university, college
sem inary of learning or school. 15. All m oneys received by or
payable to a surviving wife or child upon th e life of a deceased husband
or father, not exceeding te n thousand dollars. 16. All moneys
arising from fire or other insurance upon any property exem pt from
sale on execution. 17. All moneys, relief, or other benefits payable
to or to be rendered by any police departm ent association, fire
departm ent 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 dam ages recoverable b y any person by reason
of any levy upon or sale under execution of his exem pt personal
property or by reason of th e wrongful taking or detention of such
property ' by any person, and any judgm ent recovered for such
damages. 19. T he earnings of th e m inor child of an y debtor or
the proceeds thereof by reason of any liability of such debtor not
contracted for th e special benefit of such m inor child. 20 . One
half of the earnings of th e wages or salary of any person for his per­
sonal services rendered a t any tim e w ithin th irty days next pre­
ceding the levy of attachm ent, garnishm ent or execution when it
appears by th e affidavit of th e debtor or otherwise th a t such earnings
are necessary for th e use of th e fam ily residing in th is state, supported
in whole or in p a rt by him. 21 . All arms, uniform s and accoutre­
m ents required by law to be k ep t by any person, and also one gun
to be selected by the debtor. 22. All fire engines...........of any fire
departm ent. 23. All courthouses, jails, etc. T he property de­
clared to be exem pt by this chapter shall n ot be exem pt from at­
tachm ent or sale in any action brought or judgm ent recovered for
the purchase price of such property so long as such p roperty remains
in th e possession of th e original purchaser. (See Hom estead, Liens.)
F ra u d s a n d F r a u d u l e n t C on v ey an ces. Agreem ents m ust be in
writing and signed by th e parties to be charged: 1. B y an executor
or adm inistrator to answer for th e d eo t of his te sta to r or intestate out
of his own estate. 2. B y a person to answer for th e debt, default or
m iscarriage of another. 3. To charge any person upon an agreement
m ade upon consideration of m arriage 4. F or sale of real estate or
lease thereof for a term longer th an one year. 5. Those which are
not to be performed within th e space of one year a fte r th e making
thereof. E very gift, conveyance, or assignm ent, or transfer, or
charge upon any estate, real or personal; any su it commenced on
decree, judgm ent, or executions suffered or obtained, 'Or any bond
or other w riting given w ith in ten t to delay, hinder, o r defraud credit­
ors, purchasers or o ther persons, shall to such persons be void. All
bargains, sales, and other conveyances of lands, tenem ents, and here­
ditam ents, deeds of settlem ent of m arriage, deeds of tru st, and mort­
gages, are void as to Creditors and subsequent purchasers, without
notice, unless properly recorded. T he creditor m ust be a judgment
creditor, and notice m ust be prior to date of judgm ent lien. A judg­
m ent creditor m ay be an innocent purchaser. E v ery gift, convey­
ance, assignm ent, transfer or charge m ade by a debtor, which is not
upon consideration deem ed valuable in law shall be void as to prior
creditors, if debtor had n ot then other p roperty in th e State suffi­
cient" to pay all his indebtedness. N o t on th a t account, however,
void as to subsequent creditors. N o 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
w ith th e donor or some one claiming under him. F raudulent intent
is a question of fact and n ot of law. Conveyance shall no t be adjudged
fraudulent m erely because n ot • for valuable consideration. If any
person shall do or transact business as a m erchant or trader, with the
addition of th e words agent, factor, com pany, or & Co., o r words of
like significance or im port, and shall fail to disclose th e name of his
principal, or partner, or o ther person who m ay be interested in such
business by a sign in letters easy to read, placed conspicuously a t the
place where such business is transacted, or if any person shall transact
business in his own nam e, w ithout any such addition, all th e property,
stock, m oney and choses in action used or acquired in such business
except such property as m ay be exem pt 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.)
G a r n is h m e n t. W rit m ay issue: 1. W here w rit of attachment
has issued. 2. Upon affidavit th a t the d eb t is ju st due, and unpaid,
and th a t defendant has not, w ithin affiant’s knowledge, property in
his possession subject to execution sufficient to satisfy such debt, and
th a t th e w rit is not sued o ut to injure either the defendant or garnishee.
3. Upon judgm ent, when affiant m akes affidavit th a t th e defendant
has not, w ithin his knowledge, property in his possession within this
T erritory sufficient to satisfy said judgm ent. Proceedings under sub­
division 2 requires a bond in double the am ount o f th e debt, condi­
tioned th a t plaintiff will prosecute th e suit to effect, and pay all
dam ages and costs th a t m ay be adjudged against him for wrongfully
suing out th e garnishm ent. The proceedings are docketed and judg­
m ent rendered as if in an independent proceeding. (See Attachment.)
H o lid ay s. Legal holidays are Ja n u ary 1, F ebruary 14, February
22, Ju ly 4, October 12, Thanksgiving, M ay 30, December 25, Arbor
Day, L abor D ay, every Sunday and general sta te election day, or
any special election day th a t m ay be called by th e governor, and any
day appointed by th e president or governor. Any promissory note,
bank check, bill of exchange, acceptance, or other negotiable in­
strum ent, m ade payable a t any future period, which falls due on any
of these days m entioned, shall be considered due and collectible on
the day following, and if Ja n u ary 1, F ebruary 14, F ebruary 22, July
4, October 12, Decem ber 25. of M ay 30, and A rbor Day, shall fall
upon Sunday, th en the M onday following shall be considered as a
legal holiday. W rits of injunctions, attachm ents, replevin, and
prohibition m ay be issued and served on.
H o m e s te a d . D eed to, m ust be signed by husband an d wife. (See
Exem ptions.)
H u s b a n d a n d W ife. All property, both real and personal, of
the husband or wife, owned or claimed by him or h er before mar­
riage, and th a t acquired afterw ard by gift, devise, or descent, as also
the increase, rents, issues, and profits of th e same, shall be his or her
separate property. The earnings and accum ulations of th e wife and her
m inor children in her custody while she has lived or m ay live separate
and ap art from her husband, shall also be th e separate p roperty of the
wife. All property acquired by either husband or wife during the
marriage, except th a t which is acquired by gift, devise, or descent, or
earned by the wife and her m inor children while she has lived or may
live separate and ap art from her husband, shall be deem ed th e common
property of th e husband and wife, and during th e coverture may oe
disposed of by th e husband only. M arried women of the age oi
twenty-one years and upwards shall have the sam e legal rights as men
of the age of tw enty-one years and upwards, except th e right to maxe
contracts binding th e common p roperty of th e husband and wife; ana
shall be subject to th e sam e legal liabilities. (See Dower, Convey­
ance.)
I n j u n c t io n . Is issued, where p a rty is entitled /to relief and
restraint, is required of some prejudicial act; where, pending lltiga-

BA N K IN G AND COM M ERCIAL LAWS—ARKANSAS
tton an act is done which tends to render judgm ent ineffectual, and
when applicant is entitled under principles of equity. Under certain
conditions m ay be gran ted ex p arte a t cham bers or by consent.
Bond m ay be fixed by judge and approved by clerk, except to restrain
collection of m oney judgm ent, when it m ust be double th e am ount or
such judgm ent.
Injuries—P e rso n a l. E m ployer’s Liability and Compulsory Com­
pensation laws in force.
Insurance. (See special chapter pertaining to Insurance.)
In te re s t. M ay contract, in writing, for any ra te of, not exceeding
to per cent per annum . Any rate exceeding this is usurious. When
no express contract, on bond, bill, note, or instrum ent of writing,
or judgment, for money lent, or due on settlem ent of accounts from
date of ascertained balance, and money received for use of another,
interest is com puted a t 6 per cent per annum .
Judgments. Judgm ents of superior courts become a lien upon aU
real estate of judgm ent debtor in the county as soon as entered and
docketed. Upon filing w ith the clerk of the superior court a transcript
of judgment from justice court or of superior court of another county,
the same becomes a lien on all real estate of judgm ent debtor in the
county. No execution can be issued on any judgm ent after the
expiration of five years from the date of its rendition and entry, unless
such judgm ent be revived by scire facias or action for d eb t be brought
thereon within such five years.
Ju d icial B o n d s. (See Bonds.)
Levy. (See Executions.)
L icenses. For gambling prohibited.
Liens. All persons who m ay labor dr furnish m aterials in the con­
struction or repairing of any building, superstructure, canals, dams,
mines or other im provem ent, or cuts cordwood, shall have a lien on
the same, and in case of buildings and superstructures, on the lot of
land whereon the same is situate and connected therew ith, l o fix
and secure the lien, th e person performing labor or fam ishing m aterial
must, within sixty days after the com pletion of such labor or the fur­
nishing of m aterials, file his contract in the ofHce of the county recorder
where the property is situate. I f the contract be verbal, a duplicate
copy of th e bill of particulars should be m ade, under oath, and one
delivered to th e 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 claim ant had no notice. Suit to foreclose such liens m ust
be commenced within six m onths after filing the same in the recorder s
office In case of th e levy of w rit of attachm ent or execution, clerks,
laborers, and employes of debtors have a preference claim for wages
for service performed sixty days before levy of writ, not exceeding
$200. upon filing notice of claim unpaid w ith 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’ entertainm ent. Agister and
liveryman have lien by sta tu te. (See Judgm ent, M ortgage.)
L im ita tio n s . To recover realty against person in peaceable and
adverse possession under color of title, three years; against such possession where person pays taxes and has deed recorded, five years, other­
wise tefi years; to recover lots in city or village against person having
recorded deed, and pays taxes, five years; where p arty in possession
claims by rig h t of possession only, two years. Personal Actions—
One year: Personal injuries, malicious prosecution, false imprison­
ment, libel, slander, seduction, breach of promise. Actions for relief
on the ground of fraud; m ust be brought within one year from dis­
covery of fraud. Two years: 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 d ate of d eath. T hree y ears: Actions for debt not in
writing; on stated or open accounts other than m utual between merchants or th eir factors and agents; all accounts, except as between
merchants and factors and agents, lim itations run from date of each
item of delivery. Four y ears: For penalties or damages on any bond
to convey real estate; between partners for settlem ent of partnership
accounts; on m utual or current accounts between m erchants, their
factors or agents, to accrue from cessation of dealings; upon judgm ent
or instrum ent w ithout th e T erritory; bonds of executors, adminis­
trators, or guardian, after death, removal, etc.; specific perform ance,
to contest will after discovery of fraud; and where no provision is
otherwise made. Five y e a rs: On domestic judgm ent where execution
has been issued w ithin one year after rendition. Six years: debt
evidenced by writing within th e state.
M ines unpatented are real estate for th e purpose of inheritance and
conveyance. Location requires seven monum ents, three a t each ena,
and one a t discovery, in which notice is to be placed on discovery;
title work consisting of a shaft 4 x 6 x 8 feet deep, or its equivalent
in an open cu t so th a t m ineral in place is discovered 8 feet from the
surface m ust be done and notice recorded within three m onths, and
annual assessment work am ounting to $ 100 . m aintained each year
thereafter, u n til p aten t is orderedM inors. (See Savings Banks.)
M ortgages. M ortgage m ay contain power o f sale. W hether it
does or not, m ortgage m ay be foreclosed by suit in superior court.
Failure of m ortgagee to lawfully release a satisfied m ortgage for seven
days after dem and for th e release, subjects him to liability for $100
and actual damages. M ortgages on real estate are executed, ac­
knowledged, and recorded as conveyances of real estate. (See c o n ­
veyances, C h attel M ortgage, Acknowledgments, Redemption.)
N otary P u b lic . In all certificates and acknowledgments the date
of expiration of commission m ust be stated, as “ commission expires No certificate of holding office,-etc., is required when notary acts in
foreign state or country.
Notes a n d B ills of E x ch an g e. (See Bills and Notes.)
P a rtn e rs h ip s using fictitious nam e m ay file certificate showing
names of p artners w ith county recorders. Foreign partnerships m ay
do so.
Powers of A tto rn e y . No special sta tu to ry provisions jBBlatiye to.
To confess judgm ent m ust be executed subsequent to m aturity ot debt
confessed, and m ust be acknowledged. To convey lands or release
mortgages should be acknowledged as deeds, and recorded.
P ro b ate L aw . (See Savings Banks and Adm inistration of E states.)
P ro te st. L iability of draw er or indorser of bill or note m ay be
fixed by regular p ro test and notice, etc., according to th e usages and
custom of m erchants. (See Bills and Notes.)
Records. T he superior courts of each county are courts of record.
The recorder’s office in each county relates to titles of real estate
and personal property, and probate record instrum ent therein is
notice. The m inutes of the Sanitary Live Stock Board are notice of
all brands and m arks of live stock.
R e d em p tio n s. From sheriff or judicial sales, six m onths, by
debtors or successors in interest; any lien holder m ay redeem within
three m onths th ereafter by serving and filing statutory notice, by
serving notice in five days after end of said six m onths. The sam e rule
applies to foreclosure of m ortgages and tru st deeds w hether by court
. or under powers of sale.
R eplevin. For possession of specific personal property which has
not been seized under any process, execution or attachm ent against
the property of th e plaintiff.
Sales. The “ uniform sales law ” is in force.
Seals. Addition or omission of seals or scrolls to instrum ents of
writing in no way affect the force and validity erf the instrum ent.
Instruments executed by corporations m ust have a corporate seal
attached.


109
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1713

S ervice. All summons upon persons shall be personal, or by leaving
a copy w ith copy of com plaint a t the usual place of residence, of
defendant, with a m em ber of his fam ily 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 a t the principal office during office hours; upon any railroad,
telegraph, or express com pany, or any agent of such com pany who
resides in or m ay be fount! in th e county where suit is brought; upon
domestic corporation by serving on statu to ry resident agent, and where
there is no officer upon whom service can be m ade in th e State, ser­
vice m ay be had by delivering duplicate copies of summons and com­
plaint to the secretary of the C orporation Commission, and upon
foreign corporation by delivery to sta tu to ry agent. Personal service
of summons m ay also be had by serving upon defendant by registered
mail, as provided in statutes.
S u its . (See Actions.)
T axes. Aside from those levied by legislative enactm ent for
specific purposes, as for the construction and m aintenance of public
institutions, etc., S tate taxes are levied by the S tate 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 S tate Board
of Equalization. O ther property is valued by county assessors.
The assessing of value begins in February of each year. Taxes
are levied on the third M onday of August in each year. The lien
attaches on the first M onday of F ebruary in each year. Taxes
become due not later th an the third M onday in Septem ber, and
become delinquent if not paid on the third M onday of December.
The penalty for delinquency is 5 per cent. W ithin 60 days after
delinquency action m ay be commenced in district court to foreclose
delinquent real estate tax liens, and property sold as under execution.
Personal property tax is collected by distress w arrant. Taxes after
delinquency draw interest a t one per cent per m onth after action
commenced to foreclose tax lien penalty of twenty-five per cent is
added. T here is doubt about the right to redeem from tax sales.
W a re h o u se s. Personal property in, m ay be sold for unpaid
charges.
T ra n s fe r of C o rp o ra tio n S to c k s. (See Corporations.)
W ills. Wills m u st be in writing, signed by the testator, or by some­
one for him, in his presence and by his direction, and m ust be attested
by two or more credible witnesses above the age of fourteen years, in
the presence of each other and the testator.
W hen the will is wholly
written by the testator, no witnesses are necessary. N un-cupative
wills m ay be m ade when property willed does not exceed in value
$50, unless it be proved by three credible witnesses th a t the testato r
called on some person to take notice and bear testim ony th a t such is
his will, and th a t the testim ony, or the substance thereof, Was com­
m itted to writing within six days after the making of such will; In
such case the am ount willed is not lim ited. Wills are revocable by
subsequent will, codicil, or declaration in writing, executed w ith like
formalities as in execution of wiH, or by testa to r destroying, canceling,
or obliterating th e same, or causing it to be done in his presence, or
by subsequent marriage, and no provision is m ade for wire. Foreign
wills, th e probate whereof is duly authenticated, m ay be probated
here. Contests of wills can not be initiated after one year from date
of probating.

SYNOPSIS OF

THE LAW S OF ARKANSAS
R ELA TIN G TO

BANKING AND COMMERCIAL USAGES.
Revised by E m e r s o n & D o n h a m
A ttorneys a t Law, L ittle Rock.
(See C ard in A ttorneys’ List.)
A c c o u n ts verified by th e plaintiff as ju st and correct prove them ­
selves in suits thereon unless denied under oath.
, »
A cknow led g m e n ts m ay b© tak en w ithin tn© S tate before tne
suprem e 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 th e United
S tates before any court having a seal, or clerk of such court, notary
public, m ayor having a seal, or commissioner of Arkansas; without
the U nited States before any court having a seal, m ayor of a city
having a seal. U nited S tates consul, or any officer authorized by th e
laws of such country to probate conveyances of real estate, provided
he has a seal.
A ctio n s. Suits are prosecuted under a reform ed code of civil pro­
cedure differing from th e New Y ork code chiefly in m aintaining the
distinction between law and equity.
A d m in is tr a tio n of E s ta te s . -Executors and adm inistrators must
be residents of the S tate and m ust give bond in double the value or the
property. Foreign executors and adm inistrators can m aintain actions
in our courts. Claims are paid in the following order: First, funeral
expenses; second, expenses of last illness; third, judgm ents which are
liens on the lands of the deceased; fourth, dem ands presented within
six m onths; fifth, dem ands presented within one year. A lldem ands
not presented in one year are barred. Dem ands m ust be authenticated
by an affidavit to the effect th a t nothing has been paid or delivered
tow ard their satisfaction except w hat is credited thereon, and th a t
the sum demanded, naming it, is justly due. Dem ands m ust first be
presented to the executor or adm inistrator, and if disallowed by him
m ay be presented to the probate court, or sued upon m any court of
com petent jurisdiction. N otes and debts secured by ™ °rtgagesor
deeds of tru st m ust be probated as any other claim, and if not pre­
sented to the executor or adm inistrator within one year a f te r a p pointm ent, are barred by the sta tu te of non-claim 9 ^ one year When
the note or debt is barred this carries w ith it a barring of the m ortgage
or deed of tru st given to secure the notes or debts.
A ffidavits in this S tate are m ade before ? iudf e , justice of the
peace, notary public, or clerk of the court; w ithout the State before
a judge, m ayor, notary public, justice of the peace or commissioner
for this S tate.
A liens m ay hold and transm it property In all respects as residents.
A r b itra tio n . Controversies m ay be subm itted to arbitration, and
the aw ard of th e arbitrators is filed in court, and is subject
on equitable principles only, and n ot for m atters of form. When not
set aside th ey are entered of record and become th e judgm ent or decree
of the court.
A rre st. D efendants m ay be arrested for debt only when th e
plaintiff files an ai%lavit charging th a t th e debt was ^ u ^ u l e n t l y
tracted ; th a t it is just, giving its am ount, and th a t he beheves th a t th e
defendant is about to depart from th e State, and w ith in ten t to de-

1714

BA N K IN G AND CO M M ERCIAL LAWS—ARKANSAS

ra u d his creditors, has concealed or rem oved from th e S tate his
p roperty or so m uch thereof th a t th e process of th e court a fter judg­
m ent can n o t be executed ; or th a t th e defendan thas m oney or securi­
ties in th e possession of him self or of others for his use, and is about
to dep art from the S tate n o t leaving sufficient property therein to
satisfy th e plaintiff’s claim. Bond m ust be given conditioned to pay
th e defendant all dam ages th a t he m ay sustain if wrongfully arrested.
A s s ig n m e n ts fo r t h e B e n e fit of C re d ito rs m ay be general or
partial, w ith or w ithout preferences, and where all th e debtor’s prop­
erty is conveyed, m ay exact releases as a condition of preference. The
assignee m ust file an inventory of th e property assigned and give a
bond conditioned th a t he will execute th e tru st confided to Him sell
th e pro p erty to th e best advantage and pay th e proceeds to th e credi­
tors m entioned in th e assignm ent according to its term s, and faithfully
perform his duties according to law. H e m ust sell w ithin 120 dayB
all property except th e choses in action, which he is required to collect,
th e sale to be a t public auction after th irty days’ notice. Assignments
are v itiated by th e fraud of th e assignor alone or by an y provision
varying from th e requirem ents of th e sta tu te. A ttacks upon them
are m ade by proceedings in equity, and, if they are set aside, the
proceeds are distributed equally among all th e creditors. Assignees
close up their accounts under th e direction of th e chancery courts
Corporations can not prefer creditors.
A tta c h m e n ts m ay be sued o ut where th e defendant is a foreign
corporation or non-resident, or has been absent from the S tate four
m onths, or has left the S tate w ith intent to defraud his creditors, or
has left th e county of his residence to avoid th e service of summons,
o r conceals him self so th a t summons can not be served on him , or is
about to rem ove or has rem oved a m aterial p a rt of his property out
of th e S tate, n o t leaving enough to satisfy his creditors, or has sold
conveyed or otherwise disposed of his property, or suffered it to be
sold with th e fraudulent in ten t to cheat, hinder, or delay his creditors,
or is abo ut so to_ do. I t is obtained b y filing an affidavit stating the
n atu re of the plaintiff’s claim, that- it is just, its am ount and th e existence of th e ground, and by giving bond conditioned to pay all damages
th e defendant m ay sustain if the attachm ent is wrongfully sued out.
T he defendant is allowed to traverse th e attachm ent, and th e affidavit
and traverse then stand as pleadings upon Which th e issue is tried.
I f th e attach m en t is dissolved, th e defendant m ay have an assessment
o f dam ages upon th e bond in th e sam e suit. Persons claiming the
attach ed property m ay interplead in th e sam e action. A ttachm ents
m ay be sued out before th e debt is due where th e defendant has sold
conveyed, or otherwise disposed of his property, or perm itted it to be
sold with th e fradulent in ten t to cheat, hinder or delay his creditors,
or is so to do, or is about to rem ove his property, or a m aterial p art
thereof, out of th e State with the in ten t of cheating, hindering or delay­
ing his creditors.
B a n k s. T he banking business is controlled by a sta te bank depart­
m en t under th e direction of a bank commissioner. Any five or more
persons, th e m ajority of whom m ust be residents of this state, m ay
apply to th e commissioner to be incorporated and th e shares of capital
stock shall be not less th an $25 nor more th an $100 each; application
m ay also be m ade by an individual or firm and shall then be in such
form as th e commissioner m ay prescribe and such individual or firm
shall adopt a nam e which will show th a t it is n ot incorporated; all
p roperty owned by such bank shall be held in th e nam e of th e bank
and n o t in th e nam e of th e individuals composing the firm and all
assets o f any such p riv ate bank are exem pt from execution by any
creditor of such individual or'firm until all liabilities of the bank have
been p aid ; upon th e death of an individual banker his Widow is not
endowed of any property of th e bank except such as rem ains after the
paym ent of all depositors and other creditors.
N o corporation, firm or individual m ay do a banking business until
a fee of one-fifth of one per cent on th e authorized capital stock «ha.il
have been paid to th e b an k commissioner. Pees a t th e sam e rate
m ust be paid on each increase of th e capital stock and for each am end­
m ent or supplem ent to the articles of agreem ent, except for an increase
of capital stock, there shall be paid an additional fee of $10. T here
is also due th e commissioner an annual fee of $16 in addition to a pay­
m ent of fifty cents on each $ 1,000 of th e b ank’s capital stock.
T he fully paid-up capital stock of any bank organized after th e passage or th e banking act (M arch, 1913) cannot be less th an $10,000 in
cities havm g less th an 2,500 inhabitants, n ot less th an $20,000 in cities
having m ore th a n 2,500 and less th an 5,000 inhabitants, n ot less than
$25,000 in cities m ore th an 5,000 and less th an 10,000 inhabitants
a n a n o k m ssth a n $50,000 in cities having m ore th an 10,000 inhabitants.
The banking act does not apply to tru st companies whose minimum
capital stock is $50,000.
T he affairs of an incorporated bank are controlled by a board of
directors chosen from th e stockholders; each director m ust be the
owner of n ot less th an $500 w orth of stock, p ar value, fully paid-up and
n o t hypothecated; every bank m ust have on hand a t all tim es as a
reserve as m uch as 15 per cent of the aggregate of its deposits.
Stockholders are liable for th e debts of th e bank in th e sum of the
p ar value of their stock in addition to th e am ount invested in such
stock. (Act No. 113, A cts of 1913, page 462).
B ills. E x c h an g e a n d P ro m is so ry N o tes. T he Negotiable
In stru m en ts Law w ent into effect on April 22, 1913.
N o person can be charged as an acceptor of any bill of exchange
unless his acceptance shall be in writing. I f th e acceptance is w ritten
on another paper th an th e bill, it sh all n ot bind th e acceptor except
to favor or th e person to whom such acceptance shall have been
shown, an d who, on the faith thereof, shall have received th e bill
to r a valuable consideration. E very holder of a bill presenting
It for. acceptance m ay require an acceptance on th e bill; otherwise
th e bill can be protested for non-acceptance. N otw ithstanding th e
above provisions any one promising to accept a bill is liable to any
person to whom a promise to accept it m ay have been m ade; and
who, on th e faith of th e promise, has drawn and negotiated th e bill.
Any person on whom a bill is drawn, and to whom th e sam e m ay
be delivered for acceptance, who shall destroy it or refuse w ithin
tw enty-four hours or such tim e as th e holder m ay allow to return
th e bill accepted or n ot accepted to th e holder, shall be deem ed to
have accepted th e same. W hen th e bills become due on any holi­
day, th ey are payable th e next succeeding business day. In stru ­
m ents falling due (or becoming payable on) Saturday are to be pre­
sented for paym ent on th e next succeeding business day; except
th a t m sturm ents payable on dem and m ay be presented for paym ent
before 12 o clock on Saturday if i t is n ot a holiday. T he following
dam ages are allowed where a bill is protested for non-acceptance
or non-paym ent: I f th e bill is drawn on any place in this s ta te ,
2 per cent ; if payable in the states of Alabam a, Louisiana, Mississippi*
Tennessee, K entucky, Ohio, Indiana, Illinois, or Missouri, or any point
S? i , 9 hl° River, 4 per cent; if draw n on any o ther place in the
u n ited States, 5 per cent; if beyond the lim its of th e U nited States,
lu . P er cent. I f the bill be drawn by any person a t any place within
this S tate, a t th e ra te of 2 per cent; if drawn by any person a t any
place w ithout this S tate, b u t within th e lim its of th e U nited S tates
6 per cent; if drawn by any person w ithout th e lim its of th e U nited
States, 10 per cent. T he holder of any bill protested for non-pay­
m ent or. non-acceptance is entitled to costs of protest and interest
a t th e rate of 10 per cent per annum on the am ount of the bill from
d ate o f protest. The term BUI of Exchange includes all drafts or
orders draw n by one person on another for th e paym ent of a sum of
m oney Specified therein. Bills and notes given for patented mar-hinnc
Im plements, substance, or instrum ents of any kind, given to any
citizen of th is S tate, are not commercial paper, unless executed on
a p rinted form, and showing for w hat consideration th ey were exe­
cuted. T his applies to p aten t rights and rights to use any patented
thing of an y kind. B u t this provision does not apply to m erchants
and dealers who sell p atented things in the usual course of business.
All blank assignm ents are taken to have been m ade on such day as
shall be m ost to the advantage of th e defendant. In o ther respects
the general rules of commercial law apply.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

B ills of L a d in g . (See W arehouse Receipts and Bills of Lading)
B lu e S ky L aw . T he S tate Railroad Commission is constituted and
delegated w ith full power and authority to perm it or prohibit tho
sale of contracts, stocks, bonds or other securities in Arkansas and
application m ust be m ade and his permission obtained before foreien
or dom estic corporations, copartnerships or unincorporated assnnia
tions offer th eir securities for sale.
ocla'
T he act was passed in 1915 and am ended in 1923, and m ay be found
in Crawford & M oses’ Digest of th e S tatutes of A rkansas sections
750-771. I t is a m isdemeanor to do business w ithout obtaining t,hn
Bank Commissioner’s permission.
C o lla te ra ls are governed by th e law m erchant.
C o n tr a c ts touching commercial m atters are governed bv the l*™
m erchant.
C o nveyances m ay be either witnessed by two witnesses or ar
knowledged. (See Acknowledgments.) I f witnessed th ey are proved
by th e o ath of tw o witnesses, and are th en entitled to record as though
acknowledged. Dower can be relinquished only by th e wife joining
t “ e h u sb a n d ., T he wife m ay convey property acquired since October
30,_ 1874, by deed as a single person w ithout her husband joining her
or by joining w ith him in th e form above. T he wife m ay convev bv
Power of attorney and m ake 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 th e sta tu te, such as the omission of the words “ con­
sideration ” or “ purposes,” m akes the acknowledgment and record
void; b u t sta tu tes have been passed from tim e to tim e curing defec
tive acknowledgm ents previously m ade. Such a sta tu te was passed
to y 1907.i 9 Af new C urative ,Act was passed and approved FebruC o rp o ra tio n s are organized only under general incorporation laws
Business corporations m ust consist of n ot less th an three persons who
shall elect a board of directors. T he president and secretary are to be
elected by th e board and th e president m ust be a m em ber of it. The
secretary and treasurer m ust reside and keep th e books of the com­
pany within the S tate. T he articles of association m ust be signed bv
the president and a m ajority of the directors, and m ust be accom­
panied by a certificate signed in a like m anner and sworn to by the
president and a m ajority of the directors, setting forth the purpose of
the corporation, th e am ount of its capital stock, th e am ount actually
; paid m , the nam es of its stockholders and the num ber of shares held
by each respectively, and the articles and certificate m ust be filed in
th e office of the clerk of th e county in which th e corporation is to
transact business and th en w ith the clerk’s endorsem ent in the office
of the secretary of State. The stock can be transferred only upon the
com pany s books, and a record of the transfer has to be deposited with
the county clerk in order to be valid as against creditors of the trans­
feror. The corporation has a lien on its stock for debts due from the
stockholders. T he president and secretary are required to file with
the county clerk an annual statem ent of its financial condition, and
in case of a failure to do so become liable for its debts. If the direc­
tors declare a dividend when th e corporation is insolvent they become
liable for all th e corporate debts. Any corporation which is insolvent
or has ceased to do business m ay be wound up on th e suit of any
creditor or stockholder by a decree of th e chancery court. Prefer­
ences by insolvent corporations are forbidden. Shares of stock are in
denom inations of $25 or $ 100 . Before any corporations; foreign or
domestic, can do any business in this S tate, an annual franchise tax
m ust be paid to the S tate Treasurer, to-w it: One-fifteenth of one
per cent each year upon th e proportion of th e outstanding capital
stock of the corporation represented by property owned and used in
business transacted in this State.
E very corporation doing business for profit and organized as a
m utual 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 dom estic insurance companies, of whatsoever nature,
doing business in this S tate and having an outstanding capital stock
of less th an $500,000 shall pay an annual tax of $100; and such com­
panies having a capital stock of $500,000 or m ore an annual tax of
$200 , th is tax being in lieu of the ■tax on th e capital as provided in
other cases.
E very investm ent company, foreign or domestic, except National
banks and corporation not organized for profit, incorporated or unin­
corporated, which shall sell or negotiate th e sale of any stocks, con­
tracts, bonds or other securities of any kind or character other than
bonds of th e U nited States, or of some m unicipality authorized to
issue bonds of th e S tate, and notes secured by m ortgages on real
estate located in th e State, or sell building stock or loan investments,
shall file in the office of th e Bank Commissioner, together with a fee
o f,$ 5 . 00 , in addition to th e fees required of all incorporations, the
following docum ents: A statem ent showing in detail th e plan upon
which it proposes to transact business; a copy of all contracts, bonds
or other instrum ents which it proposes to m ake w ith or sell to its
contributors; a statem ent showing nam e and location of company
and an item ized account of its actual financial condition and any other
such inform ation which th e Bank Commissioner m ay require; if
such com pany 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
stitu tio n and by-laws and all other papers pertaining to its organiza­
tion; if -it be organized under th e laws of any other state or territory
or governm ent, incorporated or unincorporated, it shall file a copy of
the laws of such sta te or governm ent 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 Bank Commissioner shall examine all such papers and may
adm it or reject such com pany in his discretion; a company rejected,
or whose rig h t to do business is revoked by the Bank Commissioner,
m ay, w ithin tw enty days, appeal to th e chancery court of any county
to the sta te where its principal office is located or principal agent resides.
I f m be found th a t the refusal or revocation was justified, the cost
shall be paid by the com pany; otherwise by th e sta te as provided by
sta tu te.
Any individual or persons, co-partnerships, corporation, companies
or association, dom estic or foreign, which shall sell any building or
investm ent contracts or like securities on which paym ents are to be
m ade from tim e to tim e, shall first en ter into a bond with the State of
Arkansas in th e sum of $20,000 for th e faithful performance of its
contract.
Foreign Corporations shall, before doing business in th e State, by
its president file in th e office of th e secretary of S tate a certificate
under the seal of th e com pany nam ing an agent, who shall be a citizen
of this S tate upon whom service of process can be m ade. The certi­
ficate shall sta te th e principal place of business of th e corporation;
and service on th e agent shall bind it. The corporation m ust also file
a certified copy of its charter together w ith a statem ent of its assets
and liabilities, and th e am ount of its capital employed in this state
in the office of th e secretary of S tate, and in th e office of the county
where it opens an office, and m ust pay same fees as are required of
home corporations. I t m ust also file a resolution of its board of
directors consenting th a t service of process on any of its agents or on
the secretary of S tate shall be a good service. I f it sues in the federal
court or rem oves a suit th ere w ithout consent o f its adversary, its
rig h t to do business is revoked. Doing business here without compli*
ance w ith th e law subjects th e corporation to a fine of n o t less then
$1,000. These requirem ents do n ot apply to railroad or telegraph
companies th a t had built lines in the S tate prior to Feb. 16, 1899. If
any. corporation fails to appoint an agent, service of process o n the
auditor of S tate shall bind it. No foreign corporation can sue on any
contract m ade in this S tate until these provisions are complied with.

BA N K IN G AND COM M ERCIAL LAWS—ARKANSAS
Courts. T he suprem e court Is held a t L ittle Rock and has juris­
of appeals from th e circuit and chancery courts. In all coun­
ties separate courts of chancery have been established. The estates
of deceased persons are entrusted exclusively to th e probate courts,
with right of appeal to th e circuit and thence to th e suprem e court.
Claims against counties are heardby th e county court, as also m atters
touching paupers and th e like. T he justices’ courts have jurisdiction
of matters of contract n ot exceeding $300, and m atters of to rt not
exceeding $100. Two term s of th e circuit and chancery court and
four of the county and p robate courts are held, in each county per year.
Deeds. (See Acknowledgments and Conveyances.)
D epositions m ay be tak en in th e S tate before any judge or clerk of
a court of record, justice of th e peace, m ayor, or notary public; out
of the State before a commissioner for this S tate, judge, justice of the
peace, mayor, notary public, or person commissioned by th e court or
by consent of parties.
D escents a n d D is tr ib u tio n s . P roperty descends to children and
their descendants in equal p arts; if no children, th en to father, then to
mother, then to brothers and sisters and th eir descendants in equal
parts, and in default of such to th e nearest lineal ancestor or his
descendants in equal p arts per stirpes. Illegitim ate children inherit
and transm it an inheritance from the m other in th e sam e m anner as
if legitimate. If th e parents of illegitimate children subsequently
intermarry and th e fath er recognizes them as his, th ey shall be deemed
legitimate. In default o f heirs th e whole property goes to husband
or wife, and in th eir default to the State. I f th e estate is ancestral it
goes to the blood of th e ancestor from whom it was derived. Rela­
tions of th e half-blood inherit equally. Heirs tak e as ten an ts in
common.
Dower. Where there are children th e wife takes one-third of the
husband’s personal estate absolutely and one-third of the real estate
of which he was seized a t an y tim e during th e m arriage, for life. W here
there are no children she takes in a new acquisition one-half of th e real
and personal estate absolutely as against heirs, or one-third absolutely
as against creditors. I f it is an ancestral estate, she takes one-half for
life against heirs and one-third for life against creditors.
Executions from th e circuit court are returnable in sixty days,
those from justices’ courts w ithin th irty . T hey m ay be stayed for
six months by giving bond. T hey are a lien on th e property of the
defendant in th e county from th e tim e th ey come to th e officers
hands. The officer before levying on personal property, th e title
to which is doubtful, m ay require th e plaintiff to give him an indem ­
nifying bond, an d th en su it m ust be brought by th e claim ant upon
the bond. T he defendant and other judgm ent creditors have one year
in which to redeem from th e sale of real estate. In case the w rit is
returned nulla bona th e plaintiff m ay proceed by bill of discovery
against th e defendant and exam ine him on oath, and enforce a sur­
render of concealed property by im prisonm ent.
E xem ptions. U nm arried persons are entitled to $200 and m arried
persons and heads of families to $500 in selected articles of personal
property as exem pt against debts by contract. Persons who are
married or heads o f fam ilies are entitled to a hom estead as against all
debts, except th e purchase-money, specific liens, laborers’ and m echan­
ics’ liens, taxes and claims for tru st funds converted. T he homestead
in the country is n o t to exceed 160 acres, and in town n ot to exceed
one acre, nor to be w orth more th an $2,500, b u t th e country home­
stead is not to be reduced to less th an 80 acres nor the town homestead
to less than one-fourth of an acre, regardless of value. The homestead
goes to the widow and m inor children after th e husband’s d eath. The
homestead can only be conveyed by deed in which th e wife joins and
which is acknowledged b y her, and if th e thusband neglects to claim
the homestead th e wife m ay do so.
F raud. The English sta tu te of fraudulent conveyances has been
re-enacted in th is S tate.
G arn ish m e n ts m ay be sued out pending suit upon giving bond in
double the am ount garnished, or after judgm ent w ithout bond.
Holidays. T he following are set ap art and designated as legal
holidays: C hristm as D ay (Decem ber 25th); New Y ear’s D ay (Jan­
uary 1st); Ju ly F o u rth ; Thanksgiving D ay (last T hursday in Novem ­
ber); W ashington’s birth d ay (February 22nd); L abor D ay (first
Monday in September) ; General R obt. E . Lee’s bithrday (January
19th); All general biennial election days; B irthdays, Jefferson Davis,
President of th e Confederate States of America (June 3rd); Arbor
Day (first Saturday in M arch, a special day). When bills become
due on any of these days, th ey are payable the next business day.
October 12th is Columbus D ay (a public holiday, b u t n ot affecting
commercial paper, or th e execution of w ritten instrum ents, nor
interfering w ith judicial proceedings).
H usband a n d W ife. (See M arried Women.)
In ju n c tio n s m ay be issued by circuit judges, chancellors, or the
judge of any court in which su it is brought. T he person applying
for the injunction m ust give bond as th e court or judge m ay direct.
Insolvency. T he Supreme C ourt has held th a t th e Federal Bank­
ruptcy Act has suspended th e S tate insolvency laws.
In terest. The legal rate of interest is 6 per cent, b u t parties m ay
contract in writing for not exceeding 10 per cent. In terest exacted in
excess of 10 per cent forfeits the debt. In com puting th e interest
commissions paid to th e agent of th e lender are counted as interest.
Where usury is charged th e borrower m ay go into equity and have th e
debt and securities cancelled w ithout tendering th e am ount lawfully
due. Judgm ents bear th e sam e ra te of interest as th e obligation sued
on. Judgm ents against counties bear no interest.
Ju d g m e n ts (See Interest) are liens upon th e real estate of the
debtor in th e county where rendered for three years only. T he lien
may be renewed and continued for th ree years by scire facias. Judg­
ments of the U nited States and other courts can be m ade liens on lands
in counties other th an th a t where they are rendered by filing a certified
copy in the office of th e circuit clerk. A judgm ent survives for te n years.
Ju risd ic tio n . (See Courts.)
Liens. Mechanics, builders, artisans, laborers, and others doing
any work upon or furnishing any m aterial for any building or erection
under any contract w ith th e owner or his agent, contractor or sub­
contractor, shall have for such work or m aterial furnished a lien on
the building or im provem ent together w ith th e land on which it stands
to the extent of one acre if in th e country; if in a city th e lot or land
upon which th e erection is situated. H otel keepers have lien on
baggage and personal effects of guests. Liverym en have lien on all
stock and property left in th eir care.
L im ita tio n s. Suits for th e possession of real estate m ust be
brought within seven years, saving to m inors and lunatics three
years after th eir disabilities are rem oved. Actions for recovery of
lands sold a t judicial sales m ust be brought within five years, saving
to minors and lunatics three years after rem oval of disabilities.
Actions for th e recovery of lands held under tax title m ust be brought
m two years. Actions for forcible e n try and detainer,-on contracts
not in writing, for trespass and for libel, w ithin three years. _ Actions
for criminal conversation, assault and battery, false im prisonm ent,
&nd slander, w ithin one year. Actions on w ritten instrum ents, within
five years; on judgm ents, w ithin te n years; on bonds of executors
nnd administrators, w ithin eight years. In all cases, except actions
for the recovery of lands, m inors and lunatics have, after rem oval
of their disability, th e sta tu to ry period in which to sue. Verbal
promises or acknowledgments do not take a claim o ut of the_ sta tu te.
One year is allowed after dismissal of a su it in which to begin _a new
action. No person can avail him self of a disability which did not
exist at the tim e th e rig h t of action accrued. No endorsem ent of pay­
ment made by th e payee o r on his behalf is sufficient proof to tak e
the case out of th e sta tu te .
•

diction


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1715

L im ite d P a r tn e rs h ip s m ay consist of one or m ore general, and one
or m ore special partners. The la tte r of whom shall constitute in cash a'
specific am ount as his share of th e capital, beyond which he Is n ot
liable for firm debts. Those forming such partnérship m ust m ake
and file in office of circuit clerk of county, and principal place of busi­
ness, a certificate showing nam e of firm, nam es of partners, distin­
guishing between general and special, nature Of business, am ount
of capital contributed by each partner, period of commencement and
term ination of partnership. Business to be conducted by general
partners and suits brought by or against them .
M a rrie d W o m en . The property, real and personal, of m arried
women rem ains th eir separate estate as long as th ey choose, and m ay
be devised or conveyed w ithout th e husband’s assent, and is not
subject to. his debts. I f she dies w ithout m aking any disposition of
her real estate, he is entitled to curtesy. She m ay carry on any busi­
ness or perform any services on her own account, and her earnings are
hers, and she m ay 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 w ith her husband.
If she does not filé a schedule of h er personal property, th e burden of
proof is on her to show th a t it is hers.
M in e s a n d M in in g . U nder control of commissioner of mines.
All docum ents relating to mines m ust be recorded in the recorder s
office of the county; and m iners of th e county m ay m ake by-laws
regarding the tim e, m anner, and am ount of work necessary to hold
claims and o ther rules and regulations not in conflict w ith law. Extensiv© provisions are m ade for th e protection of tlie health, and safety
of miners. (Acts 1893, p. 213.) M iners have a lien on th e output,
m achinery, and tools used to secure paym ent for work done. T hree
years’ possession of a m ine, w ith work required by law, gives possessory
right.
M o rtg a g e s are n ot liens as against any one, though such person
has actual notice of th eir existence, u ntil th ey are acknowledged in
the form prescribed and filed for record. M ortgages of real estate
are recorded in th e county where th e land lies, and m ortgages of
personal property in the county of th e m ortgagor’s residence. I f th e
m ortgagor of personality is a non-resident th e m ortgage is recorded
in the county where the property is situated. Sales under m ortgages
and deeds of tru st can be m ade only after appraisem ent, and .the
property m ust bring tw o-thirds of th e appraised value. In case it is
offered and fails to bring th e required am ount real estate m ay be
offered again after one year and personal property after sixty days,
and is then sold for w hat it will bring. T he m ortgagor of real estate
has one year from th e date of sale in which to redeem . In action to
foreclose a mortgage, it is sufficient defence th a t th e d eb t (which it
recites), is barred by sta tu te of lim itations.
.
C hattel M ortgages m ay be acknowledged and filed as other m ort­
gages, or they m ay be endorsed “ T his instrum ent is to be filed b u t not
recorded,” signed by th e mortgagee, and m ay th en he filed in th e
recorder’s office w ith the sam e effect as though recorded. M ortgages
of personal property reserving in th e m ortgagor th e power of disposi­
tion are fraudulent.
M o rtg a g e s a n d D eeds of T r u s t m ay be enforced by foreclosure
a t any tim e within th e period prescribed b y law for foreclosing m ort­
gage or deed of tru st so far as the property m entioned and described
in such m ortgage or deed of tru st is concerned, b u t no claim or deb t
against th e estate of a deceased person shall be probated agam st
such estate w hether secured by m ortgage or deed of tru st or not
except within the tim e prescribed by law for probating claims agam st
said estate.
P ow ers o f A tto rn e y . Lands m ay be conveyed by power of a tto r­
ney, which is acknowledged as deeds and recorded in th e county
where th e lands lie.
P ro b a te L aw . (See A dm inistration of E states.)
P ro te s ts . (See Bills of Exchange and Prom issory Notes.)
R e co rd s. (See Acknowledgments, Conveyances, M ortgages,
C hattel M ortgages, and Powers of A ttorney.)
R e d e m p tio n . (See Executions and M ortgages.)
R e p le v in . T he plaintiff in replevin m ay filé an affidavit describing
th e property, stating its value and th e am ount of damages he expects
to recover, his title, th a t the property is wrongfully detained by th e
defendant, th a t it has not been tak en for a tax or under process against
plaintiff, an d th a t his cause of action has accrued w ithin three years,
and upon giving bond in double its value, th e property shall be taken
from th e defendant and given to th e plaintiff pending th e suit, unless
th e defendant w ithin two days after it is tak en gives a cross-bond,
R e v isio n . T h e last revision of th e sta tu tes was in 1904.
T axes. A ll-property should be assessed for taxes betw een the
first day of M ay and th e first day of June in each year, except in
counties where th e population exceeds 75,000, in which taxes should
be assessed between th e first day of Jan u ary and the 10th day of
April. Taxes m ust be paid between Jan u ary 1st and April 10th of
th e year following the assessment. A fte r April 10th penalty of 25
per cent will accrue. Taxes are first and param ount lien upon real
an d personal property after first M onday in June of the year in which
assessm ent is m ade, which lien continues u ntil such taxes w ith penalty
shall be paid.
T e s tim o n y . (See Evidence.)
T ra n s fe r of C o rp o ra tio n S to c k . (See Corporations.)
T r u s t C o m p a n ie s m ust have a paid-up capital of $50,000, and
in counties w ith a population exceeding 50,000, th ey m ust have a sub­
scribed capital of not less th a n $100,000. T hey m ay exercise all the
powers commonly conferred on such companies.
W ages. No assignm ent or order of wages to be earned in the
future to secure a loan of less th an $200 , shall be valid against any
em ployer or the person m aking such assignm ent or order, until such
assignm ent or order is accepted in writing b y th e em ployer and the
said assignm ent or order and th e acceptance of sam e has been filed
w ith th e recorder of th e county where th e p a rty m aking th e assign­
m ent or order resides, if a resident of th e sta te where he is employed:
N o assignm ent or order of wages to be earned in th e future shall be
valid when m ade by a m arried m an unless th e w ritten consent of his
wife to m aking such an assignm ent or order for Wages shall be attached.
W a re h o u se R e c e ip ts a n d BiUs of L a d in g shall n ot be given
except where the commodities m entioned are received on the premises,
and are under th e Control of th e warehousem an a t the tim e of its
issuance. No warehousem an shall sell, encum ber, ship, or remove
any such com m odity for which a receipt has been given w ithout th e
w ritten assent of th e holder of th e receipt. The same provisions cover
owners and agents of boats and vessels. All warehouse receipts and
bills of lading are m ade negotiable by w ritten endorsem ent and
delivering th e sam e as bills of exchange and promissory notes, and no
printed or w ritten conditions, clauses, or provisions inserted in or
attached to th em shall in any way lim it their negotiability or im pair
th e rights and duties of th e parties thereto, or persons interested
therein, or such conditions shall be void. Warehouse receipts given
by any warehousem an or o ther person for goods and other com­
m odities deposited, and all bills of lading given by any carrier, boat,
vessel, railroad, transportation, or transfer company m ay be tran s­
ferred b y endorsem ent and delivery; and the transferee shall be
deem ed to be the owner of such commodities so far as to give validity
to any pledge, lien, or transfer given, m ade, 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 th e words ‘‘n ot negotiable”
plainly w ritten or stam ped oh their face, A carrier m ay however
deliver to shipper or consignee goods w ithout presentation of bill of

1716

BA N K IN G AND COM M ERCIAL LAWS—CALIFORNIA

lading upon receiving from such shipper or consignee bond in double
th e 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 sta tu te. So m uch 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 rem oved by operation of law.
W ills. A will m ust be subscribed by th e testa to r or by some person
for him a t his request in th e presence of two attestin g witnesses, and he
m ust acknowledge it to be his will to each of them . He m ust declare
r 1?, tu n e of his subscription or acknowledgm ent to the witnesses
th a t th e instrum ent is his will and testam ent. The witnesses m ust
sign th eir nam es a t th e end of the will as witnesses a t the request of
th e testato r. If, however, th e entire will is in the hand-w riting of the
testato r, it need n ot be attested, b u t m ay be proved by three witnesses
tam ih ar with th e hand-w riting. Such will, however, can not be
pleaded in bar of an atteste d will. 'Wills are revoked by m arriage and
b irth of issue, unless provision for such issue is m ade by settlem ent,
o r is provided for in the will. T he will of an unm arried woman is
revoked by her m arriage. Afterborn children, not m entioned in the
will, take their regular distributive share. If th e testato r fails to
m ention in; his will any child, or its legal representatives, living a t the
tim e 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 LAW S OF CALIFORNIA
RELA TING TO

BANKING AND COMMERCIAL USAGES.
Revised by H e n r y G. W . D i n k e l s p i e l
A ttorney and Counselor a t Law, San Francisco.
(See C ard in A ttorneys’ List.)
A c c o u n ts. An account is assignable, and th e assignee m ay m ain­
tain an action thereon, although the account is assigned merely for
collection. An action to recover a balance due upon a m utual current
and open account or upon an open book account is barred within four
years. The cause of action on a m utual account is deemed to have
accrued from the date of the last item . In th e case of an open book
account, each item becomes outlawed four years after its date. (See
Actions and Lim itations.)
A ck n o w le d g m e n ts. Before an instrum ent can be recorded, its
executicm m ust be acknowledged by th e person executing it, or if
executed by a corporation, by its president or secretary, or other
person executing th e same on behalf of the corporation, or proved by a
subscribing witness, or by judgm ent in an action brought for the
purpose. T he proof or acknowledgm ent of an instrum ent m ay be
m ade a t any place within the S tate before a justice or clerk of the
suprem e 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 th e peace. The acknowledg­
m ent of an instrum ent m ust not be taken, unless the officer taking it
knows or has satisfactory evidence, on the oath or affirmation of a
credible witness th a t the person making such acknowledgm ent is the
individual who is described in, and who executed the instrum ent;
or if executed by a corporation th a t th e person m aking such acknowl­
edgm ent is thé president or secretary of such corporation, or other
person who executed it on its behalf. Officers taking and certifying
acknowledgments or proof of instrum ents for record, m ust authenti­
cate their certificates by affixing thereto th eir signatures, also their
seals of office, if by the laws of the S tate or country where the ac­
knowledgm ent or proof is taken, or by au th o rity of which they are
acting, they are required to have official seals. Acknowledgments
taken out of th is S tate to be used w ithin this S tate m ay be taken
before a notary public, a commissioner appointed by th e governor
of th is State, a judge, or clerk of a court of record, or in foreign coun­
tries a m inister, consul, vice-consul, or consular agent of the U nited
States, or a judge of a court of record or a n otary public.
A ctio n s. All civil actions are commenced by filing a com plaint,
upon which plaintiff m ay, a t any tim e within one year thereafter, have
a summons issued. T here is b u t one form of action and the only
pleadings allowed on the p a rt of the plaintiff are: 1 . The com plaint.
2. The dem urrer to th e answer. 3. The dem urrer to the cross-com­
plaint. 4. The answer to the cross-complaint, and on the p art of
the defendant: 1. The dem urrer to the com plaint. 2 . The answer.
3. T he cross-complaint. 4. The dem urrer to the answer to the
cross-complaint.
A d m in is tr a tio n of E s ta te s . Upon the admission of a will to
probate, letters testam entary are granted by the superior court to the
executor nam ed in the will, unless he be dead or incapable or unwilling
to act, in which case letters testam entary are issued to an adm inis­
trato r w ith th e will annexed, appointed by said court. In case of
intestacy, letters of adm inistration are issued to the bona fide resi­
den t of the sta te entitled thereto, in the following order: 1. Relatives
of whole blood entitled to adm inister in preference to those of half
blood. Surviving husband or wife, or some com petent person named
by either. 2. Children. 3. F ather or m other. 4. Brothers. 5. Sis­
ters. 6 . Grandchildren. 7. N ext of kin entitled to share in the dis­
tribution of the estate. 8 . Public adm inistrator. 9 . Creditors
10. Any person legally com petent. W here the person entitled to
adm inistration is a m inor or incom petent, letters m ust be granted to
his or her guardian, or to any other person entitled to letters of
adm inistration in the discretion of the court. Bonds for faithful
perform ance of d u ty are required of an adm inistrator and of an
executor unless waived, by the will. N otice m ust be given by the
adm inistrator or executor by publication to all the creditors to come
in and prove th eir claims within ten m onths after its first publication,
when th e estate exceeds in value the sum of ten thousand dollars,
and four m onths when it does not. 11. Claims arising on contract
w hether due or hot due or contingent, and funeral expenses m ust be
presented w ithin tim e prescribed by notice to creditors, otherwise
th ey are forever barred, unless it appears by affidavit of the creditors
th a t such creditor was outside of the S tate and consequently did
not receive notice. Unless claim is approved within the tim e pro­
vided for in the notice it is barred, unless th e claim ant can prove
to the satisfaction of the court th a t he had no notice by reason of
being out of th e S tate, in which case the claim may be presented
a t an y tim e before a decree of distribution is entered. When a claim
is rejected either by the executor or adm inistrator or the judge,
th e holder m ust bring suit in the appropriate court thereon within
three m onths 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. N o claim can be allowed which is barred by the S tatu te of


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Lim itations. Claims against the estate are paid in the follnwin»
o r d e r : ! . Funeral expenses. 2. The expenses of the last sic k S ?
3. D ebts having preference by the laws of the United States /'
Judgm ent rendered against the decedent in his lifetime and mew
gages and other liens in the order of th eir date; and 5 . all other hT
mands against the estate.
■ Qe'
A ffidavits. An affidavit to be used before an y court, judge
officer of this S tate m ay be taken before any officer authorized
adm inister oaths. In this S tate every court, every judge or clerk 3
any court, every justice and every notary public, and every officer ni
person authorized to take testim ony in any action or proceeding
decide upon evidence, has power to adm inister oaths and affirmation»
An affidavit taken in another S tate of th e U nited States to b e S
in this S tate, m ay be taken before a commissioner appointed b v
governor of this S tate to take affidavits and depositions in such other
State, or before any notary public in another S tate, or before anv
judge or clerk of a court of record having a seal. .An affidavit taken
in a foreign country to be used in this S tate, m ay be taken before an
am bassador, m inister, 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.
s sea1.
A liens. 1. All aliens eligible to citizenship m ay tak e hold and
dispose of jproperty, real and personal, within this State.
2. All aliens not eligible to citizenship m ay acquire and possess land
in accordance with the term s of any existing treaty with any foreten
country of which such alien is a citizen, and not otherwise and in
addition m ay lease land for agricultural purposes for three years
3. Any company, association or corporation composed in the main
of aliens m ay acquire and possess land in accordance with the term»
or any existing treaty with any foreign country of which they ara
citizens, and not otherwise, and in addition m ay lease land for agri
cultural purposes for three years.
4. When it appears in any probate proceedings wherein any alien
Is an heir th at he could take real property except for th e provision of
this act, the probate court shall order the sale of such real nroiiemand distribute the proceeds to such alien.
^ *
5. For any violation of this act the attorney-general shall institute
forfeiture proceedings and upon final judgm ent the lands shall escheat
CO CI16

6 . When it appears th a t any alien or aliens are holding any leaseinterests in violation of the above provisions the attorney-general
shall likewise institute forfeiture proceedings, and such leasehold
interest or its m onetary value together with the costs of such forfeiture
proceedings shall escheat to the State.
No non-resident alien can tak e by succession unless he aDDear
and claim within 5 years a fter death of decedent.
A r b itra tio n . The submission to arbitration m ust be in writing
and it m ay stipulate th a t it be entered as an order of the superior
court, for which purpose it m ust be filed by the clerk. If the sub­
mission is not m ade an order of the court, it m ay be revoked at any
tim e before the award. All the arbitrators m ust act, b u t a majority
governs. T heir aw ard m ust be in writing, signed by a majority of
them , and delivered to the parties, and when th e submission is made
by an order of the court, m ust be filed by the clerk who enters the
same, after the expiration of five days, in th e judgm ent book, and
thereupon it has the effect of a judgm ent. T itle to real property
cannot be arbitrated. Upon application a S tate Board of Arbitra­
tion has jurisdiction over disputes between employer and employee.
A rre st. In an action for the recovery of money, upon a contract
express or Implied, the defendant m ay be arrested if about to depart
from the State w ith in ten t to defraud his creditors, upon order of
court based upon affidavit therefor, also in an action for money or
°th er 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 em ploym ent, 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 rem oved or disposed of to
prevent its being found; also in cases where th e defendant has been
guilty of a fraud in contracting th e debt or obligation for which action
is brought; or in concealing or disposing of property; also when the
defendant has rem oved or disposed of his property or is about to do
so with in ten t to defraud creditors. Bail given upon arrest is liable
upon judgm ent secured.
■
!^®sll8intneiits fo r th e B en efit of C re d ito rs. Assignments for
the benefit of creditors m ust be w ritten and acknowledged by the
assignor or his agent authorized thereto in w riting and recorded, and
m ust be m ade to the sheriff of th e county where th e insolvent resides,
or, if a non-resident, where he has property. Assignments for the
benefit of creditors are void against any creditor n ot assenting thereto
m a num ber of instances ; for example, where th ey give one debt a
preference over another, and where th ey tend to coerce any creditor to
release or compromise his demand. Assignments m ust contain names
of creditors and the am ounts.
A tta c h m e n ts m ay be issued a t the tim e of or any time after
issuing the summons where am ount sued for exceeds $10.00.. All
property not exem pt from execution m ay be attached. An attach­
m ent lien upon real property continués for three years and may be
extended for two years more. The clerk of th e court must issue
the w rit of attachm ent upon receiving an affidavit by or on behalf
of the plaintiff showing, ( 1) T h at the defendant is indebted to the
Plaintiff, specifying the am ount of such indebtedness over and above
all legal set-offs or counter-claims, upon a contract, express or implied,
for the direct paym ent of money, and th a t such contract was made
or is payable m this state, and th a t the paym ent of the same has
not been secured by any m ortgage or lien upon real or personal prop­
erty, or any pledge of personal property, or, if originally so secured,
th a t such security has, without any act of plaintiff, or the person
to whom the security was given become, valueless; or (2) That th*
defendant is a non-resident of the State, and is indebted to plaintiff,
specifying the am ount of such indebtedness over and above all legal
set-offs_or counter-claims, upon a contract expressed or implied;
or (3) T h at plaintiff's cause of action against defendant is one to
recover a sum of money as dam ages (specifying th e am ount thereof)
arising from an injury to property in this S tate in consequence of
the negligence, fraud or other wrongful act of th e defendant, and
th a t the defendant is a non-resident of the State; and (4) That
the attachm ent is not sought, nor is the action prosecuted, to hinder,
delay, or defraud any creditor of defendant. Before issuing the writ,
th e clerk m ust require a w ritten undertaking on th e p art of the plain­
tiff, in a sum not less than $200, or in Justices C ourt of from $50.00
to $300, and not exceeding the am ount claimed by plaintiff, with
sufficient sureties, to the effect th at, if the defendant recovers judg­
m ent, the plaintiff will pay all costs th a t m ay be awarded to the
defendant, and all dam ages th a t he m ay sustain by reason of the
attachm ent, not exceeding the sum specified in the undertaking, and
th a t if the attachm ent is discharged on the ground th a t 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 attachm ent, not exceeding the sum
specified in the undertaking.
B a n k s, S avings. A savings bank m ay purchase or hold;
Real E state, furniture, fixtures, etc., in which its business may be
conducted. (2) P roperty m ortgaged or held in trust on account or
any money lent in the course of business. I t shall not purchase
personal property except ( 1) bonds or interest bearing obligations
of the U nited S tates (2) bonds of the State. (3) Bonds of any state
which has not defaulted in paym ent of either principal or interest
w ithin five years. (4) Bonds of any county, city or town or school,
road, sewer, drainage, reclamation, protective or sanitary district,
organized under the laws of the state, to limited am ount. (5) Bonus
of any county, city or town of any state, of a population of more than
20,000 and, an entire bonded indebtedness less than fifteen per cent
ftO id

BA N K IN G AND COM M ERCIAL LAWS—CALIFORNIA
. tihe taxable property, where interest or principal has n ot been
S
u ite d within Are years. (6 ) Bonds of railroads organized under
defaulted
state Huu uuciauuig cav»udi»wv v«v*v»« w»
-------------------w
least 500 miles of standard gauge tract, or of any railroad cprnnration paym ent of which has been guaranteed, by the preceding
E e s of railroads; provided, th a t In all cases th e net earnings are
as required by sta tu te. (7) Bonds of Public U tility corporations,
incorporated under th e laws of the S tate of California, provided the
nrouerties and earnings, etc., are as required by statu te. (8 ) Notes
nr bonds secured by first lien on real estate to sixty per cent of its
market value. (9) Collateral tru st bonds or notes secured by denndt of authorized bonds fifteen percent in excess of such collateral
& ds or the deposit of such bonds and other securities tw enty per
«mt in excess of such collateral bonds, provided the m arket value
nf the authorized bonds deposited, equal such collateral bonds. ( 10 )
Ronds accepted by savings banks under the laws of New York or
Massachusetts. (11) Certificates issued by corporations with a paid
nn capital stock of not less than 8100.000 secured upon real estate
and guaranteed in th e m anner required by th e Bank Act. No savings
hank must loan money except on adequate security on real or personal
nronerty and such loan m ust not be for longer th an ten years. I t
must have a paid up capital stock graduated from $25,000 when located
ta any Place of less th an 5,000 population, to $300,000 when the
ooDUlation is in excess of 200,000. Savings banks organized without
fiaDital stock m ust have a reserve fund of $1,000.000. The capital
stock and surplus of savings banks, m ust equal ten per cent to and
including $2 ,000,000 deposit liabilities, m ust exceed seven and one
half per cent of deposit liabilities from $2,000,000 to $5,000,000,
}jve ¿er cent from $5,000,000 to $15,000,000, two and one-half per
rent from $15,000,000 to $40,000,000 and one per cent of deposit
liabilities in excess of $40,000,000. A surviving husband or wife or
next of kin of an y deceased person m ay, w ithout procurmg_ letters
of administration, w ithdraw any sum deceased m ay bave had on
deposit in any savings b ank if th e sum does n ot exceed $500 .00 .
Banks. T he business o f banking m ay be carried on only by
corporations organized for th a t purpose under the Bank Act. The
capital stock and surplus of commercial banks m ust exceed ten per
cent of deposit liabilities. Such corporation are classified as: Com*
mercial, Savings or T ru st companies, and, together with building and
loan associations, are conducted under the supervision and inspection
of a State S uperintendent of Banks, to whom such banks m ust sub­
mit at stated intervals to exam ination. N o person unless organized
as a bank under th e laws Of th is sta te m ay hold him self out as en­
caged in th e banking business, or use th e word bank, savings or
trust company in connection w ith his business. E very bank m ay
conduct a commercial an d savings departm ent, provided its capital
stock if situated in a locality whose population does n ot exceed 5,000
amounts to $25,000, or b o th or either departm ents in conjunction
with a tru st departm ent if th e same am ounts to $125,000. If the
population of a locality is from 5,000 to 25,000 a capital of $50,000 is
required for a savings and commercial departm ent and $150,000 for
both or either in conjunction w ith a tru s t departm ent. If the population
Is from 25,000 to 100,000 a capital stock of $ 100,000 a n a $200,000
respectively is required; if the population is from 100,000 to 200,000
»capital stock of $200,000 a n ,$400,000 respectively is required; if
the population is in excess of 200,000 a capital stock of n ot less th an
$300,000 and $500,000 is required. T he capital stock m ust be paid
up in all instances. E very bank m ust designate the character of its
business. A bank organized under th e laws of another sta te m ust
comply with all th e requirem ents of th e S tate B ank Act, set a p art to
its business conducted here th e surplus paid up stock required ox
California corporations, and constitute the S tate Superintendent or
Banks its agent for service of process. A banker has a general lien
dependent upon possession of all property in his hands belonging to a
customer for th e balance due to him from such custom er m th e course
of business. T he sam e capital stock is required of commercial banks
as of savings banks. (See savings banks.) W ith some exceptions no
commercial b ank can lend more th an ten per cent of its capital stock
on unsecured loans or twenty-five per cent upon security w orth a t
least fifteen per cent more th an the loan so secured, b u t a commercial
bank may buy or discount bills of lading or exchange drawn against
actual value or b u y and discount commercial paper, n ot to exceed
twenty-five per cex t of its capital and surplus.
Bills a n d N o tes. T he Uniform N egotiable .Instrum ents Law is
In force. S tatutes of 1917. C hapter 751.
C h attel M o rtg a g e s m ay be m ade on any personal property,
including growing crops and fruits, except personal property not cap­
able of m anual delivery, articles of wearing apparel and personal
adornment, and th e stock in trad e of a m erchant, provided th a t when
said personal property refers to fixtures or equipm ent of a m erchant,
seven days’ notice m ust be given, otherwise the sam e is void as to
creditors of th e m ortgagor. In th e absence of delivery and continued
change of possession, th e ch attel m ortage will be void as to creditors
of the m ortgagor unless acknowledged or proved, certified, and re­
corded, as required in cases of grants of real property and accompanied
by affidavits of all th e parties th a t it is m ade in good faith, and w ith­
out any design to hinder, delay or defraud creditors'. Such chattel
mortgages m ust be recorded in th e office of th e C ounty Recorder of
the county in which the m ortgagor resides, if he be a resident of th is
state, and it shall also be recorded in th e county in which the property
mortgaged is situated, or (save iD the case of live stock, vehicles,
(other than m otor vehicles] and other m igatory chattels) to which it
is removed. If rem oved to another county such chatel m ortgage
must be recorded in such county w ithin th irty days of such rem oval.
If such mortgaged property is voluntarily removed by th e m ortgagor
from the county where it is situated, th e m ortgagee m ay take posses­
sion of the sam e and dispose of it as a pledge though th e debt is not
due, save in th e case of life stock, vehicles (other th an m otor vehicles)
and other m igatory chattels. W hen the m ortgage on live stock,
vehicles (other th an m otor vehicles) and other m igatory chattels has
been recorded, and a certificate of th e sam e has been filed w ith the
Secretary of S tate b y th e C ounty Recorder, th e m ortgage will n ot be
affected by rem oval of th e property m ortgaged to any county within
the Stated
C ollaterals. 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 th e perform ance or any act. Delivery of the thing
pledged is essential to th e validity of th e bailm ent. W hen th e per­
formance of the act for which th e pledge is given is due in whole or
in part, the pledgee m ay collect w hat is due to him by the sale of the
property pledged. B u t before th e property can be sold th e pledgee
must demand perform ance thereof from the debtor, if he can be
found, and m ust give actual notice to the pledgor of th e tim e and
place at which th e property pledged will be sold, a t such a reasonable
time before th e sale as will enable th e pledgor to attend, b u t notice
of the sale m ay be waived by the pledgor a t any tim e. The. sale
must be by public auction and m ust be for th e highest obtainable
price. After the sale th e pledgee m ay deduct from the proceeds the
amount due and th e necessary expenses of sale and collection, and
must pay th e surplus to the pledgor. The pledgee, or a pledge­
holder, m ay purchase th e property pledged when the sam e is sold
at public auction. A pledgee can not sell any evidence of debt
(collateral) pledged to him, except th e obligations of governments,
•tates, or corporations; b u t he m ay collect the same when due.
C o n tracts. C ertain contracts are invalid unless the same or
some note or m em orandum thereof is in writing. (See S tatu te of
Frauds.) A contract for personal services Cannot be enforced for
over five years'.
Conveyances. An estate in real property, other than an estate at
"ill. or for a term n o t exceeding one year, can be transferred only by
operation of law, or by an instrum ent in writing, subscribed by the
Party disposing of th e same, or by his agent thereunto authorized in
"riting. Leases of agricultural land for a longer period th an fifteen
thA


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1717

years and of city property for a longer period than ninety-nine years are
void. A fee simple title is presum ed to be intended to pass b y a gran t
of real property, unless it appears from th e face of the grant th a t a
lesser estate was intended. A g rant of real property m ay be m ade
in th e following form : “ I, A. B., grant to C. D. all th a t real prop­
erty situated in (insert nam e of county) county, S tate or California,
bounded (or described) as follows: (Here insert description^ or if
the land sought to be conveyed has a well-established descriptive
name it m ay be described by such as for instance: The Norris
Ranch.’) Witness m y hand this (insert) day of (insert m onth). 19—
A. B .” The use of the word “ g ra n t” implies the following cove­
nants: 1. T h a t previous to the tim e of the conveyance the grantor
had not conveyed the sam e estate, or any right, title, or interest
therein to any person other th an the grantee. 2. T h at such estate
is a t the tim e of the execution of the conveyance free from Incum­
brances. done, m ade, or suffered by the grantor. Subsequently
acquired title passes by operation of law to th e grantee, or his suc­
cessors. Instrum ents entitled to be recorded m ust 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 Jaw from
the tim e ft is filed with the recorder for record, is constructive notice
of th e contents thereof to subsequent purchasers and mortgagees, and
every conveyance of real property other th an a lease for a term not
exceeding one year is void as against anv subsequent ^purchaser ^or
mortgagee of the same property, or any p art thereof, in good faith
and for a valuable consideration, whose conveyance is first duly
recorded.
C o rp o ra tio n s . P rivate corporations m ay be formed by the volun­
ta ry association of any three or more persons, in the m anner prescribed
by sta tu te not to exceed fifty years. A m ajority of such persons m ust
be residents of this State. P riv ate corporations m ay be formed for
any purpose for which individuals m ay lawfully associate themselves.
The num ber of directors of corporations for profit, except those
m entioned as excepted, m ay be increased or diminished, by a m ajor­
ity of the stockholders of th e corporation to any num ber, n o t less
th an three, who m ust be members of th e corporation. T he original
articles of incorporation m ust be filed w ith th e Secretary of S tate,
and upon th e filing of th e Articles of Incorporation and affidavit,
where the sam e is required, th e Secretary of S tate m ust issue to th e
corporation, over th e great seal of this S tate, a certificate th a t th e
original articles containing th e required statem ent of fact have been
filed in his office, and thereupon th e persons signing th e articles, and
their associates, and such successors shall be a body politic and cor­
porate by thè nam e stated in the certificate and for th e term of fifty
years, unless it is, in th e Articles of Incorporation, otherwise stated ,
or in th is Code otherwise specifically provided ; provided^ however,
th a t no corporation shall be authorized to tran sact any business until
it shall have filed in th e office of th e C ounty Clerk of th e C ounty
in which its principal place of business is to be transacted, a copy of
the Articles of Incorporation, certified by the Secretary of State. A
copy of any articles of incorporation filed in pursuance of this chapter,
and certified by th e Secretary of State, m ust be received in all th e
courts, and other places as prim a facie evidence of th e facts therein
stated. (See Foreign Corporations.) All stocks are assessable for th e
purpose of paying debts and m eeting expenses b u t no single assess­
m ent m ust exceed 10 per cent. The franchise of all corporations as
distinct from its tangible property is subject tò taxation.
E ach stockholder of a conioration is individually and personally
liable for such proportion of its debt and liabilities incurred while
he was a stockholder as th e am ount of stock or shares owned by
him bears to th e whole of th e subscribed capital stock or shares of
the corporation, and for a like proportion only of each d e b to r claim
against the corporation, b u t such liability is barred within three
years after the obligation is incurred. Any creditor of the corporation
m ay institute joint or several actions against any of its stockholders
for th e proportion of this claim, payable by each, and in such action
th e court m ust ascertain th e proportion of th e claim or d eb t for which
each defendant is liable, and a several judgm ent m ust be rendered
against each in conform ity therew ith. I f any stockholder pays his
proportion of any debt due from th e corporation incurred while
he was such stockholder, he is relieved from any further personal
liabilities for such debt; and If an action has been brought against
him for such debt, it shall be dismissed as to him upon his paying
th e costs, or such proportion thereof as m ay be properly chargeable
against him. T he term “ stockholder" extends to every equitable
owner of stock, although th e sam e appears on the books in the nam e
of another, and aiso to every person who has advanced th e install­
m ents or purchase m oney of stock in th e nam e of a minor, so long as
th e latter rem ains a m inor; and also to every guardian or other
trustee who voluntarily invests an y tru st funds in th e stock. Stock
held as collateral security,' if fact of pledge appears, or by a trustee, or
in any other representative capacity, does n ot m ake th e holder thereof
a stockholder, except in the case above m entioned, so as to charge
him w ith any proportion of the debts or liabilities of the corporation;
b u t th e pledgor, or person, or estate represented is to be deemed the
stockholder as respects such liabilities. In corporations having no
capital stock, each m em ber is individually and personally liable for
his proportion of its debts and liabilities, and similar actions m ay be
brought against him, either alone or jointly w ith other members, to
enforce such liabilities as by this section m ay be brought against one
or more stockholders, and sim ilar judgm ents m ay be rendered.
C o u rts. Term s and Jurisdiction. Justices’ courts have civil
jurisdiction: l. In actions arising on contracts for th e recovery of
money, only if the sum claimed, exclusive of interest, does n ot am ount
to $300, and the jurisdiction of a justice of the peace in all cases
where money judgm ent is recoverable is lim ited to. $300. 2. In
actions for dam ages for injury to th e person, or for taking, detaim ng.
or injuring personal property, or for injury to. real property, where
no issue is raised by the verified answer of the defendant involving
th e title to or possession of the same, if th e damages claimed do not
am ount to $300. 3. In actions to recover the possession of personal
property if the value of such property does not am ount to $300.
4. In actions for a fine, penalty, or forfeiture not am ounting to $300
given by sta tu te, or the ordinance of an incorporated city or town,
where no issue is raised by the answer involving th e legality of any
tax, im post, assessment, toll, or municipal fine. 5. In actions upon
bonds or undertakings conditioned for the paym ent of money, if
th e sum claimed does not am ount to $300, though th e penalty m ay
exceed th a t sum. 6 . To take and enter judgm ent for the recovery
of money on th e confession of a defendant, when th e am ount con­
fessed, exclusive of interest, does n ot am ount to $300. 7. Also con­
current jurisdiction w ith th e superior courts, within their respective
townships in actions, of forcible entry and detainer, where the rental
value of the property entered upon or unlawfully detained does not
exceed $25 per m onth, and the whole am ount of damages claimed
does not exceed $200. Also in actions to enforce and foreclose liens
on personal property, where neither the am ount of the liens nor th e
value of th e property am ounts to $300.
Superior C ourt. The jurisdiction of th e superior court is of two
kinds: 1. Original. 2. Appellate. T he superior court has original
jurisdiction in all cases in equity ; in all civil actions in which the sub­
ject of litigation is n ot capable of pecuniary estim ation; in all cases a t
law which involve the title or possession of real propertyp or th e
legality of any tax* etc., and in all o ther cases in which the dem and,
exclusive of interest or th e value or the property In controversy,
am ounts to $300; of actions of forcible entry and detainer, of pro­
ceedings in insolvency; of actions to prevent or abate a nuisance ; of
all m atters of probate, of divorce and for annullm ent of m arriage;
and of all such special cases and proceedings as are not otherwise
provided for. T hey also have power to issue writs of mandam us,
certiorari, prohibition, quo warranto, 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 m ay be issued and

1718

BA N K IN G A ND COM M ERCIAL LAWS—CALIFORNIA

served on legal holidays ana non-juaiciai days. T he superior courts
have appellate jurisdiction in cases arising in Justices’ and other
inferior com^s in their respective counties provided the appeal be
tak en within th irty days of th e judgm ent.
,, D istrict C ourts of Appeal. T he S tate is divided into three appellate
districts, each of which has a court of appeals w ith three justices.
These_ courts have appellate and original jurisdiction. T he general
Ime of dem arcation between th e suprem e court and these courts is
®he
of m oney or the value of th e property Involved. The
district courts of appeal have appellate jurisdiction on appeal from
th e superm r courts in all casesnat law in which th e dem and exclusive
***6 value of th e property in controversy am ounts to
$300 an d does n ot am ount to $2,000; also-in all cases of forcible
en try an d detainer (except such as arise in th e justices’ courts):
in proceedings in insolvency, and in actions to prevent or abate a
nuisance; in proceedings in m andam us, certiorari and prohibition,
usurpation of office, contesting elections and em inent domain, and
in such o ther special proceedings as m ay be provided b y law (exceptc&ses in which appellate jurisdiction is given to th e suprem e
court) ; also on questions of law alone in all cases prosecuted by
Indictm ent or inform ation to a court of record, excepting crim inal
cases where judgm ent of d eath has been rendered. Said courts also
have appellate jurisdiction in all cases, m atters and proceedings
pending before th e suprem e court which shall be ordered b y th e
suprem e court to be transferred to a district court of appeal for
hearing and decision.
Supreme C ourt. H as original and appellate jurisdiction. In the
exercise of original jurisdiction it shall have power to issue writs of
m andam us, certiorari, prohibition, and habeas corpus; it shall also
have power to_ issue all other w rits necessary and proper for th e
com plete exercise of its appellate jurisdiction. T he suprem e court
has appellate jurisdiction in ali cases in equity, except such as arise
In th e justices courts; also in all cases a t law which involve th e title
or possession of real estate or th e legality of any tax, im post, assessm ent, toll or m unicipal fine, or in which th e dem and exclusive of
L oniS r'
. 6 value^ of th e property in controversy am ounts to
$2 ,0 0 0 ; also in all such probate m atters as m ay be provided by law;
also on questions of law alone in all crim inal cases where th e judgm ent
of d eath has been rendered; th e said court also has appellate juris­
diction in all cases, m atters and proceedings pending before a dis­
tric t court of appeal which shall be ordered by th e suprem e court to
be transferred to itself for hearing and decision.
D e p o sitio n s. T he deposition of a witness o ut of this S tate m ay
be tak en upon a commission issued from th e court under th e seal of
th e court, upon an order of th e court, or a judge or justice thereof, òn
th e application pf either p arty, upon five days’ previous notice to the
MfaWl court be a Justice’s court, th e commission shall have
attach ed to it a certificate under seal by th e clerk of th e superior
court of th e county to th e effect th a t th e person issuing the sam e
was an acting justice of th e peace a t th e date of th e commission. If
issued to any place w ithin the U nited States, it m ay be directed to a
person agreed upon by th e parties, or if th ey do not agree, to any
no tary public, judge or justice of th e pecae or commissioner selected
by th e court, or judge, or justice issuing it. I f issued to any country
o ut of tlm u n ited States, it m ay be directed to a m inister, am bassador,
consul, vice-consul, or consular agent of th e U nited S tates in such
country, or to an y person agreed upon b y th e parties or judge of a
court of record m such county. The commission m ust authorize the
commissioner to adm inister
oath to the witness. The testim ony
of a witness o ut of the S tate m ay be taken by deposition in an action
^ j e after the service of th e sum m ons or th e appearance of
Jg S d efendant ; in a special proceeding, a t any tim e after a question
of fact has arisen therein. Depositions m ust be taken in th e form
of question and answer. T he words of th e witness m ust be w ritten
down, m the presence of th e witness, by th e officer taking th e dep­
osition or by some indifferent person appointed by him . I t m ay
be taken down m short hand in which case it- m ust be transcribed
to long hand by th e person who took it down. W hen com pleted,
it m u st be carefully pead to or b y th e witness and corrected by him
in an y particular, if desired, by w riting, or causing his corrections
to be ^written a t th e bottom of th e deposition, and m ust then be
subscribed by the witness. Corrections m ust be initialed by officer
before whom deposition is taken. If th e parties agree in w riting to
an y other mode, th e mode so agreed upon m ust be followed.
Depositions in th is S tate. T he testim ony of the witness in this
S tate m ay be taken by depositions in an action a t any tim e a fter the
service of summons or th e appearance of defendant, and in a special
proceeding a fter a question of fact has arisen therein, in certain
enum erated cases.
Depositions for Use o ut of th e S tate. A ny p a rty to an action or
special proceeding in a court or before a judge of a sister state, m ay
obtain th e testim ony o f a witness residing in this S tate, to be used in
such action or proceeding, in th e cases m entioned following: I f a
commission to tak e such testim ony has been issued from the court
or a judge hereof, before which such action or proceeding is pendProducing the commission to a judge of th e superior court
w ith an affidavit satisfactory to him of th e m ateriality of th e testi­
m ony, he m ay issue a subpoena to th e witness, requiring him to
appear and testify before th e commissioner nam ed in th e commission, a t a, specified tim e and place. I f a commission has n ot been
Issued an d it appear to a judge of th e superior court, or a justice of
th e peace, by affidavit satisfactory to him : 1. T h at the testim ony
of th e witness is m aterial to either p arty. 2 . T h at a commission to
tak e testim ony of such witness has n ot been issued. 3 . T h at
according to th e law of the S tate w here the action of special proceeding
is pending, th e deposition of a witness taken under such circum­
stances, and before such judge or justice, will be received in the action
or proceeding, he m ust issue a subpoena requiring the witness to
appear and testify before him a t a specified tim e and place. Upon
th e appearance of th e witness, th e judge or justice m ust cause his
testim ony to be taken in writing, and m ust certify and transm it th e
sam e to th e court or judge before whom th e action or proceeding is
pending, in such m anner as th e law of th a t S tate requires.
D e s c e n t a n d D is tr ib u tio n of P ro p e rty . P roperty, both reai
an d personal, of an intestate passes to his heirs. U pon the d eath of
either husband or wife, one-half of th e com m unity property belongs
to th e surviving spouse; th e other half is subject to the testam entary
disposition of th e decedent, and in the absence thereof, goes to th e
^UJ’viving spouse. C om m unity property is all property acquired by
th e husband and wife during their m arriage, which does n ot include
p ro p erty acquired by .either gift, bequest, devise, or descent, which
is separate property. Dower interest does not exist. T he separate
estate is distributed as follows : I f 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 husband or wife and chi’l l or issue of
such child. If a surviving husband or wife and more th a n one child
living, or one child living and the lawful issue of one or more deceased
children, one-third to th e surviving husband or wife, and the rem ainder
in equal shares to the children and to the lawful issue of any deceased
child by right of representation. B u t if there be no child living the
rem ainder goes to all th e lineal descendants, and if th ey are in thè
sam e degree of kindred to th e decedent th e y share equally, otherwise
b y rig h t of representation. I f th e decedent leaves no surviving
husband or wife, the whole estate goes to the issue— the issue of
children taking by right of representation. I f there is no issue the
estate goes one-half to the surviving husband or wife and the other
h alf to th e fath er and m other in equal shares, or, if one be dead, to
th è survivor; if there be no father or m other, then their one-half goes
in equal shares to the brothers and sisters or to their representatives.
I f there is no issue, or husband or wife,. the estate goes to the father
and m other, or th e survivor, or. if both be dead, then in equal shares
to th e brothers and sisters, and to the children of any deceased brother
or sister b y right of representation. I f the decedent leaves a sur-


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

viving husband or wife, and neither issue, father, m other, brother m ,
sister, th e whole estate goes to th e surviving husband or wife If thZ
decedent leaves neither issue, husband, wife, father, m other brottS.
nor J i s t e r th e estate m ust go to th e next of kin In equal deem/
Illegitim ate children inherit from m other, also from fath er if recosmimi
m writing b u t can only inherit directly and n o t by representation
These are th e principal provisions of the law of succession T en an t
by th e courtesy is n ot known to our law. I f th e person dies in te s t
all property passes as directed by th e will.
E x e c u tio n s. M ay issue any tim e w ithin five years from entr* nt
judgm ent and after lapse of five years th e judgm ent m ay be enforces
or carried into execution by leave of court upon motion, or by iudg
m en t for th a t purpose, founded upon supplem ental procrodinm
N o rig h t of stay exists except by order of th e court in its discretion’
E xecution m ay issue against the p roperty of a judgm ent dehtJi
a fter his death, only if the judgm ent be for recovery or real of
sonal property, or th e enforcem ent of liens thereon. Real pronertr
m ay be redeem ed within one year, personal property n o t a t all. f
E x e m p tio n s . T he following property is exem pt from execution1. Chairs, tables, desks, and books, to th e value of $200. 2 Neceo!
sary household, table and kitchen furniture belonging to th e judgment
debtor, including one sewing machine, stoves, stove-pipes andfurni
ture, wearing apparel, beds, bedding and bedstead, hanging Dictum
oil paintings and drawings drawn or painted by an y member of the
fam ily, and fam ily portraits, and their necessary frames, provision«
and fuel actually provided for individual or fam ily use sufficient
^ e.mor,k“s, an<i three cows and their sucking calves, four hose
w ith th eir sucking , pigs, and food for such cows and hogs for one
m onth, one piano, one shotgun, and one rifle. 3. T he farming uten!
sils or im plem ents of husbandry n ot exceeding in value the sum of
$ 1, 0 0 0 ; also two oxen or tw o horses, or two mules, and their harnessone c a rt or buggy and two wagons, and food for such oxen, horses’
or “ hies for one m onth; also all seed, grain, or vegetables, actually
provided, reserved or on hand for the purpose of planting or sowing
a t any tim e within the ensuing six m onths, n o t exceeding in value
th e stun of $200 , and seventy-five bee hives, and one horse and ve­
hicle belonging to any person who is maim ed or crippled, and the
sam e is necessary in his business. 4. T he tools or implements of
m echanic 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
th e exercise of their profession, w ith their professional libraries and
necessary office furniture; the professional libraries of attorneys
judges, m inisters of th e gospel, editors, school teachers and music
teachers and their necessary office furniture, including one safe and
one typew riter, also th e musical instrum ents of music teachers ac­
tually used by them in giving instructions; and ail th e indexes ab­
stracts, books, papers, m aps, and office furniture of a searcher of
records necessary to be used in his profession; also the typewriters
or other m echanical contrivances employed for w riting in type ac­
tually used by th e owner thereof for m aking his living; also one
bicycle when the same is used by its owner for th e purpose of carrying
on his regular business, or when the sam e is used for the purpose
° f transporting the owner to and from his place of business. 5 . The
cabin or dwelling of a m iner not exceeding in value th e sum of $500;
also his sluices, pipes, hose, windlass, derrick, cars, pumps, tools,
im plem ents, and appliance necessary for carrying on any mining
operations, not exceeding in value the aggregate sum of $500; and
tw o horses, mules, or oxen, w ith th eir harness, and food for same
for 906 m onth, when necessary to be used in any whim, windlass,
derrick, car, pum p, or hoisting gear, and also his mining claim, actu­
ally worked by him , not exceeding in value th e sum of $ 1,000. 6.
Two horses, two oxen, or two mules, and their harness, and one cart
or wagon, one d ray or truck, one coupe, one hack or carriage for one
or two horses, by the use of which a cartm an, truckm an, huckster,
eddler, hackm an, team ster, or other laborer habitually earns his
ving, and one horse w ith vehicle and harness, or other equipments
used by a physician, surgeon, constable or m inister of the gospel in
th e legitim ate practice of his profession or business, with food for
sam e for one m onth. 7. One fishing boat and net, not exceeding
the to tal value $500, the property of any fisherman by the lawful
use of which he earns a livelihood. 8 . Poultry, not exceeding in value $75. 9. Seam en’s and seagoing fishermen’s wages and earn­
ings n ot exceeding $300. 10. T he earnings of th e judgment debtor
for his personal services rendered a t any tim e within thirty days
next preceding the levy of execution or attachm ent, where it appears
by th e debtor’s affidavit or otherwise, th a t such earnings are neces­
sary for th e use of his family, residing in this S tate supported in whole
or in p a rt by his labor; b u t where debts are incurred by any such
person, or his wife or fam ily for th e common necessaries of life, or
have been incurred a t a tim e when the debtor had no family residing
in this S tate, supported in whole or In p a rt by his labor, the onehalf of such earnings above m entioned are nevertheless subject to
execution, garnishm ent, or attach m en t to satisfy debts so incurred.
11. T he shares held by a m em ber of a hom estead association duly
incorporated, not exceeding in value $ 1,000 , if th e person holding
the share is not th e owner of a hom estead under th e laws of this
S tate. 12 . All th e nautical instrum ents and wearing apparel of
any m aster, officer, or seam an of any steam er 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 com pany or departm ent or­
ganised under any law of this State. 14. All arms, uniforms and
accoutrem ents required by law to be k ep t by an y person, and also
one gun to be selected by the debtor. 15. All court houses, jails,
and town, county, and S tate buildings; all public buildings, grounds,
places, etc. 16. All m aterial purchased for use in th e construction,
alteration, etc., of any building, mining claim, etc., n ot exceeding the
value of $1,000. 17. All machinery, tools, and implements neces­
sary in and for boring, sinking, p u tting down, and constructing sur­
face or artesian wells; also the engines necessary for operating such
m achinery. Implements, tools, etc.; also all trucks necessary for the
transportation of such m achinery, tools, implem ents, engines, etc., to
th e value of $1,000. 18. All moneys, benefits, privileges, or im­
m unities accruing, or in any m anner growing out of any life insurance
on th e life of th e debtor, if th e annual prem iums paid do not exceed
$500. 19. Shares of stock in any building and loan association to
th e value of $1,000. 20. Pensions from th e U nited States Govern­
m ent. No article, however, or species, of property mentioned in
th is section, is exem pt from execution issued upon a judgment re­
covered for its price or upon, a judgm ent of foreclosure of a mortgage
or other lien thereon. (For Hom estead Exem ptions, see Homestead.)
F r a u d . (For F raudulent D ebtors, see Arrest.) Any contract
obtained through fraud is voidable. Consent is deemed to have
been obtained through fraud only when it would n ot have been given
had such cause not existed. Actual fraud consists in the suggestion
as a fact of th a t which Is not true, the positive assertion of th at which
is n ot true in a m anner not w arranted by th e inform ation of the person
m aking it though he believes it to be tru e, the suppression of that
which is tru e by one having knowledge of it, and promises made with­
out any inteption of performing, or any other act fitted to deceive.
C onstructive fraud, consists of any breach of duty , which without an
actual fradulent intent, gains an advantage of th e person in- fault
by misleading another to his prejudice. Actual fraud is always a
question of fact.
G a r n is h m e n t. Upon receiving instruction in writing from the
plaintiff or his attorney th a t 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 m ay be. are a tta c h e d
in pursuance of such writ. All persons having any such property
a t th e tim e of serving of such writ, unless it is delivered up or trans-

S

BAN K IN G AND COM M ERCIAL LAWS—CALIFORNIA
farred or paid to th e sheriff, shall be liable to th e am ount of such
credits property, or debts, until th e attach m en t be discharged, or
«ay judgm ent by him recovered be satisfied.
H olidays. Are every Sunday, th e first day of January, 12th day
nf February, th e 22nd day of F ebruary, th e 30th day of M ay, the
4th day of July, th e 9 th day of Septem ber, th e 1st M onday in Sep­
tember, th e 12th day of October, Arm istice D ay, N ovem ber l l t b . the
25th day of December, every day on which an election is held throughout the S tate, and every day appointed by th e P resident of the
United States, or by th e governor of th e S tate, for a public fast,
thanksgiving or holiday. I f th e first day of January, th e 12th day
of February, 22nd day of F ebruary, the 30th day of M a y ,,4 th d a y
nf July 9 th day of Septem ber, 12th day of October, Arm istice D a y ,
November 11th, or th e 25th day of December fall on a Sunday, the
Monday following is a holiday. E very S aturday from twelve
nVlock noon u n til twelve o’clock m idnight is a holiday as regards
the transaction of business in th e public offices of th is S tate, and
also in political divisions thereof where laws, ordinances or charters
orovide th a t public offices m ay be closed on holidays; p ro w led this
shall not be construed to prevent or invalidate th e issuance, , filing,
service, execution, or recording of any legal process or w ritten instru­
ment w hatever on such Saturday afternoons. C ontracts m ade on a
h0H om estead.ld 'T h e hom estead consists in th e Interest of th e claim­
ant divided or undivided, in the dwelling house in which the claim ant
resides and in th e land on which th e sam e is situated, selected, if the
claimant be m arried, from com m unity property, or th e separate
oronerty of th e husband, or, w ith th e consent of th e wife from her
separate property. W hen th e claim ant is n ot m arried, b u t is th e head
o fafam fiy , th e hom estead m ay be selected from any of his or her
senarate property. T he hom estead can not be selected from th e
senarate property of th e wife w ithout her consent, shown by her
mining or joining th e declaration of hom estead. T he hom estead is
exempt from execution or forced sale, except in satisfaction of Judg­
ments obtain ed : 1. Before the declaration n f hom estead was filed for
record and which constitutes liens upon the premises. 2. On debts
secured by mechanics’ contractors’, sub-contractors , artisans , archi­
tects’ builders’, laborers’ of every class, m aterialm ens or vendors
liens upon th e premises. 3. On debts secured by m ortgages on the
nremises, executed and acknowledged by th e husband and wife of an
unmarried claim ant. 4. On debts secured by m ortgages on th e
nremises, executed and recorded before the declaration of hm nestead
was filed for record. In cases n ot enum erated above, in which, after
a iudgment has been docketed against the hom estead claim ant, and
an execution for its enforcem ent levied on th e hom estead, it m ay be
shown by an appraisem ent applied for to, and ordered by, the court,
after proper proceedings, th a t th e homestead exceeds in value the
amount of hom estead exemption. T hen steps m a y b e t a k e n . i f i t
can be done w ithout m aterial injury to the land, to divide th e prop­
erty and reach th e excess. T he hom estead of a m arried person can
not be conveyed or encum bered unless th e instrum ent by which it
is conveyed or encum bered is executed and acknowledged b y both
husband and wife. Hom esteads m ay be selected and claimed: 1. If
not exceeding $5,000 in value, by any head of a fam ily. 2. If not
exu d i n g $1,000 in value, by another person upon death of either
spouse, if hom estead is selected from com m unity property,or from
separate property of spouse joining therem , title thereto vests in sur­
vivor otherwise to th e heirs or devises of the person whose property
W8H u sb an d ’ a n d W ife. T he husband is th e head of th e famfiyv
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 th e separate Property
of the other, and eith er m ay enter into any engagem ent w ith the
other, or w ith any other person, respecting property^ which either
might if unm arried. All property of either, owned by him or her
before marriage, and th a t acquired afterw ard by gift, bequest, devise
or descent, is th e separate property of such person, AU other prop^
erty acauired after m arriage by either husband or wife or both, is
community property, b u t whenever any property is conveyed to a
married woman b y an instrum ent in writing, the presum ption is th a t
the title is thereby vested in her as her separate property. The
husband has th e m anagem ent and control of th e com m unity prop­
erty with absolute power of disposal other th an testam entary, pro­
vided th a t he cannot m ake a gift of the sam e or convey th e same
without valuable consideration, unless th e wife consents in v o tin g .
The community property is not liable for th e contracts of th e wiie
made after m arriage, unless Secured by a pledge or m ortgage thereoi
executed by th e husband. T he husband is not liable for dam ages or
torts com m itted by wife except in a case where he would be jointly
liable with her if th e m arriage did n o t exist. T he separate property
of the husband is n ot liable for th e debts of the wife contracted before
marriage, and th e separate property of th e wife is not liable for the
debts of her husband, b u t is liable for her own debts contracted before
or after marriage. A husband and wife m ay hold property as joint
tenants, ten an ts b y entreaties, ten an ts in common, or as a com m unity
property upon death of wife entire com m unity property goes to hus­
band, whereas on d eath of husband wife gets one half of com m unity.
In te re s t. The legal rate of interest is 7 per cent and is due upon
judgments after rendition and upon other obligations unless
is an express contract in w riting fixing a different rate. The parties
may agree, in writing, to a higher ra te of interest, but not exceeding
12 per cent for one year, and not exceeding th a t rate for a longer or
. ShJ u d g m e n ts . (See Actions.) Upon filing the judgm ent roll, which
Is a record of th e proceedings in th e case, it m ust be docketed by the
clerk, whereupon it becomes a lien upon any real property of a judg­
ment debtor n o t exem pt from execution m the county which the
said judgm ent debtor owns a t th a t tim e, or which he m ay thereafter
acquire. This lien continues for five years,,unless th e enforcement
of the judgm ent be stayed on appeal. A judgm ent is barred by the
act of lim itation within five years, unless revived by leave of court
upon motion or by an action upon th e judgm ent. Judgm ent inust
first be satisfied o u t of property of th e judgm ent debtor which has
been attached and in th e custody of the sheriff.
¡Jggl
Liens. Mechanics, m aterial-m en, contractors, sub-contractors,
artisans, architects, machinists, builders, miners, team sters, araymen and all persons and laborers of every class performing labor
upon or furnishing m aterial to be used in or furnishing appliances,
teams ano power contributing to the construction, alteration, or
repair of any building, wharf, bridge, ditch, flume, aqueduct, well,
tunnel, fence, m achinery, railroad, wagon road, or other structure,
have liens upon th e property upon which they have worked or fur­
nished m aterial, and any person performing labor m a mining claim
has a lien upon th e same, and the works owned and used by th e 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 paym ent of his fare. One who sells real property has a vem
dor’s lien thereon. Im provers of personal property, depositaries for
hire, veterinary surgeons, livery stable keepers and persons pasturing
horses or stock, have a special lien, dependent upon possession.
Factors, banks, and laundry proprietors have a general lien, de­
pendent on possession, on any personal property in their hands.
Seaman have general liens independent of possession. Owners or
animals used for propagating purposes have a lien for th e agreed
price upon th e offspring. Loggers rendering services upon logs,
bolts and other tim ber have a lien thereon for th e am ount due for
___'
their personal services.
■$
,
.
Every person perform ing work or labor m, 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 th e extent
of the value of his services, for ten days after ceasing work or labor,
provided, w ithin th a t tim e, an action is brought to recover the am ount
of the claim, persons repairing or altering any personal property have
a lien for th e reasonable value of such service.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1719

L im ita tio n s . I f real estate is held adversely for five years, such
adverse possession ripens into title if claim ant pays taxes for five years,
except against infants and persons under disability. The periods proscribed for the commencement of actions other th an for th e recovery
of real property, are as follows: W ithin five years; ( lb An action
upon a judgm ent or decree of any court of th e United States, or of
any S tate within th e U nited States. (2) An action for mesne profits
of real property. W ithin four years: (1) An action upon any con­
tract, obligation or liability foundëd upon an instrum ent in writing,
executed in this S tate. (2) An action to recover a balance due upon
a m utual open and current count or upon an open book account.
W ithin three years: (1) An action upon a liability created by statu te,
other th an 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 th e ground of fraud or mis­
take the cause of action in such case n ot to be deem ed to have accrued
until th e discovery by the aggrieved p arty of th e facts constituting
fraud or m istake: W ithin two years: (1) An action upon a contract,
obligation or liability not founded upon an instrum ent of ^"iting, ° r
founded upon an instrum ent of writing executed out of the State.
(2) An action on a debt, liability or obligation evidenced b y a n abstract,
guarantee or certificate of title; and such action shall not be deemed
to h av e accrued until th e discovery of th e loss or damage. ^ (3) An
action against a sheriff, coroner, or constable,, upon a liability incurred
by th e doing of an act in his official capacity,' and m virtue of his
office, or by th e omission of an official duty, including th e non-pay­
m ent of m oney collected upon an execution; b u t this subdivision does
n ot apply to an action for an escape. W ithin one year : (1) An action
upon a sta tu te for a penalty or forfeiture, when th e action is given to
an individual or to an individual and the S tate, except when the
sta tu te imposing it prescribes a different lim itation. (2) An action
upon a sta tu te, or upon an undertaking m a criminal action, for a
forfeiture or penalty to th e people of th is S tate. (3) An action for
libel, slander, assault, battery, false im prisonm ent, 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 fen* th e paym ent
of a forged or raised check. (4) An action against a sheriff, or other
officer, for th e 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. W ithin six m onths;
(1) An action to recover property seized by tax collector. (2) To
recover corporation stock sold for delinquent assessm ent.. To actions
brought to recover m oney or other property deposited w ith any bank,
banker, tru st company, or savings and loan society, there is no limi­
tation. If when th e cause of action accrues against aspersoti, he is
out of the State, the action m ay be commenced within the term
herein lim ited, after his return to the State, and^if, after th e cause or
action accrues, he departs from th e S tate, th e tim e of his absence is
n ot p a rt of th e tim e lim ited for th e commencement of th e action.
And if the person entitled to bring th e action be, a t th e tune the action
accrued, either a minor, insane, imprisoned for a term less th an life,
or a m arried woman, and her husband is a necessary p arty w ith her
in commencing such action, the tim e of such disability is not a p art
of th è tim e lim ited for th e com m encement of the action. No acknowl­
edgm ent or promise is sufficient to take a case o ut of the operation
of th e sta tu te of lim itations, unless th e sam e is m writing, signed by
th e p arty to be charged. P a rt paym ent will not take the case out of
th e sta tu te of lim itations. W here a cause of .action has arisen in
another State, and would be barred by the sta tu te of lim itations of
th a t State, an action cannot be m aintained here. T here is no lim ita­
tion upon actions to recover money or property w ith banks or tru st
com panies. (See Accounts.)
M a rrie d W o m e n . A m arried woman m ay be sued w ith o u t her
husband being joined as a p arty and m ay sue w ithout her husband
being joined as a p arty in all actions, including those for in ju ry to
her person, libel, slander, false im prisonm ent, or malicious prosecution,
or for the recovery of her earnings or concerning her right or claim to
th e hom estead property. A m arried woman m ay become a sole
trader by the judgm ent of th e superior court o f th e county iff which
she has resided for six m onths next preceding th e application. _The
husband of th e sole trad er is not liable for any debts contracted by
her in the course of her sole trad er’s business unless contracted upon
his w ritten consent. A m arried woman m ay convey w ithout consent
of her husband, and is.n o t liable for th e debts of her husband, b u t is
liable for her own debts contracted before or after her marriage.
She m ay contract as a femme sole so as to bind her separate property.
T he wife m ay m ake a will of both her separate property and one-half
th e com m unity property. The earnings of the wife are n ot liable for
th e debts of her husband.
M e c h a n ic s’ L ie n s. (See, Liens.)
M o rtg a g e s. Any interest in real property which is capable of
being transferred m ay be m ortgaged. A m ortgage can be created,
renewed, or extended only b y writing executed w ith th e formalities
required in th e case of a grant of real property. E very transfer of an
interest in real property, other th an in tru st, m ade only as the security
for the perform ance of any act, is to be deem ed a m ortgage, and the
fact th a t the transfer was m ade subject to defeasance on a condition
m ay for the purpose of showing such transfer to be a mortgage, be
proved (except as against th e subsequent purchaser or encum brancer
for value and Without notice) although th e fact does not a p p e a r,by
th e term s of th e instrum ent. A m ortgage is a lien upon everything
th a t passes by a grant of the property. A m ortgage does not entitle
th e m ortgagee to the possession of the property. T he assignm ent of
a debt secured by a m ortgage carries with it the security. When a
m ortgage is satisfied or the m ortgage indebtedness paid, the m ort­
gagee m ust satisfy the m ortgage of record under penalty. A
mortgagee m ay foreclose the right of redem ption of the mortgagee,
unless expressly stipulated the m ortgage is not a personal obligation
on p art of m ortgagor.
N otes a n d B ills of E x ch an g e. (See Bills and Notes.)
P led g e. (See Collaterals.)
P ow ers of A tto rn e y . An attorney in fact m a y be appointed for
any purpose for which an agency can lawfully be created. Powers or
attorney can only be confèrred by an instrum ent m writing subscribed
by the principal which m ust particularly specify the powers con­
ferred. If the instrum ent contains a power to convey .o r execute
instrum ents affecting real property, it m ust be duly acknowledged
and m ust be recorded in the county within which the real property
to be conveyed or affected is situated. No such
been so recorded is revoked by any act of the p arty by f o r a i t was
executed, unless the instrum ent containing such revocation is also
acknowledged or proved, certified, and recorded m the sam e office
In which th e instrum ent containing th e power was recorded. When
an attorney in fact executes an instrum ent transferring an estate
in real property, he m ust subscribe the nam e of his prm cipal to it,
and liis own nam e as atto rn ey in fact.
P ro b a te L aw . (See Adm inistration of Estates, Claims against
E states of deceased persons. Descent and Distribution.) The superior
court has jurisdiction of proceedings in probate and such proceedmgs
m ust be instituted (1) In th e county m which the decedent was a
resident; (2) in th e county in which he m ay have died, leaving estate
therein, he not being a resident of th e S tate; (3) m th e county m
which any p a rt of the estate m ay be, if the decedent died out of the
S tate and was not a resident. (4) In any county iff wkich any p art
of th e estate m ay be, or the decedent not being a resident of th e
State nor leaving an estate in the county of death. (5) In other cases
where application is first m ade, any person interested m ay petition
for probate of a will or m ay contest such probate withi» one year.
An inventory and appraisem ent is required of the executor or adm in­
istrator w ithin -three m onths. Upon the return of th e mvmitory the
court m ay set ap art for use of the surviving husband or wife, or of
the minor children, all the property exem pt from éxecution including

1720

BA NKING AND COM M ERCIAL LAWS—COLORADO

any hom estead selected, providing the sam e was selected from the
common property or from th e separate p roperty of th e person select­
ing or joining in the selection of th e same. I f none has been selected,
th e court m ust select, designate and set ap art and cause to be recorded
a hom estead for the use of th e surviving husband or wife, or of the
minor children, or if there be no surviving husband or wife, then for
th e use of the m inor children out of the common property, or if th ere
be no common property, th en o ut of th e real estate belonging to the
decedent. P roperty so set a p a rt is not subject to further adm inis­
tration. I f upon th e retu rn of the inventory it appears th a t th e value
of th e whole estate does not exceed $1,500, th e court m ay set ap art
the whole of the estate for th e use and support of the fam ily of th e
deceased.
P r o te s t. (See Bills and Notes.)
R e p le v in . T here is no action of replevin in this S tate, b u t the
action of claim and delivery substantially takes its place. The
plaintiff in an action to recover th e possession of personal property
m ay a t th e tim e of issuing th e summons, or a t an y tim e before answer,
claim th e delivery of such property. An affidavit m ust be m ade by
the plaintiff or by some one in his behalf showing th a t th e plaintiff
is th e owner of the property, or entitled to its possession, th a t the
property is wrongfully detained by the defendant, the alleged cause
of detention thereof, and th a t it has not been taken for a tax, assess­
m ent or fine, or seized under an execution or attachm ent, or if so
seized th a t it is exem pt; also th e actual value of the property. P lain­
tiff m ust also give a bond in double th e value of th e property. The
defendant m ay give to the sheriff a w ritten undertaking in double
the value of th e property, and retain the same, b u t in case he fails
so to do th e property is delivered to the plaintiff. T hird parties
m ay upon affidavit of ownership, claim such property and secure
its release under bonds. T he judgm ent in such action is in the
alternative for a retu rn of th e property or for its value in case a de­
livery can n o t be had.
S ale o f S to c k S h a re s. P erm it m ust be obtained from S tate Cor­
poration Commissioner.
S t a t u t e of F ra u d s . A will m ust be in writing, except a nun­
cupative will. ' (See Wills.) An agreem ent not to be performed
within a year from m aking it m ust be in w riting; also a special prom­
ise to answer for th e debt, defraud, or miscarriage of another; also
agreem ents m ade in consideration of m arriage other th an a m utual
promise to m arry. An agreem ent for th e sale of goods and chattels
or things in action a t a price not less th an $200, unless th e buyer
accept and receive p a rt of th e sam e or any p a rt of th e purchase
money. No estate in land will pass o ther th an leases n o t to exceed
one year, unless in writing. An agreem ent authorizing or employing
an agent or broker to purchase or sell real estate for compensation
or for a commission. An agreem ent by its term s not to be performed
in th e lifetim e of th e promise or to m ake, devise or bequeath by will.
No evidence is admissable to charge a person upon representations
as to th e credit of another, unless th e representations be in writing.
However where prom isor has received property to apply pursuant
to promise or a discharge of an obligation in consideration of the
promise, or where a creditor parts w ith value or where th e new prom ­
ise is su b stituted for th e old debt, or where levy or execution is re­
leased or th ere is benefit moving to promise from any p arty or where
a factor undertakes for a commission to guarantee a sale, contracts
to answer for th e default of another need not be in writing. Transfer
o f personal property capable of m anual delivery, except wine in cellars
and tanks, when not accompanied by delivery and change of posses­
sion are deem ed fraudulent as to third parties unless notice of inten­
tion of sale is recorded seven days before transfer is m ade in accordance
w ith law.
S u p p le m e n ta r y P ro c e e d in g s. W hen an execution is returned
unsatisfied, th e judgm ent creditor can obtain an order requiring the
judgm ent debtor to appear and answer concerning his property before
the judge or referee appointed by him , also, in case after th e issuing
of an execution, upon proof by affidavit th a t the judgm ent debtor has
property which he unjustly refuses to apply tow ard th e satisfaction
of th e judgm ent, th e judge m ay m ake th e order, and instead thereof,
if it appear th a t th e debtor is about to abscond, he m ay, by order of
the judge, be arrested and required by him to give security for the
judgm ent, or th a t he will a tten d from tim e to tim e during th e pen­
dency of th e proceedings, and th a t he will not in the m eantim e dis­
pose of any portion of his property, and in default of security he m ay
be com m itted to prison.
T axes, Oh the first M o n d a y . of December of each year taxes
become delinquent, except the last installm ent of the real property
taxes, and thereafter 15 per cent is added for delinquency; provided,
th a t if th ey be not paid before th e last M onday in April next succeed­
ing, 5 p er cent is added for delinquency. On th e last M onday in
April, of each year, all th e unpaid portion of th e rem aining one-half
of th e taxes on all real property is delinquent, and thereafter 5 per
cent is added for delinquency; and provided further, th a t the entire
tax on an y real property m ay be paid a t the tim e the first installm ent
as above provided is due and payable; and provided further, th at
the taxes on all personal property, unsecured by real property, shall
be due and payable im m ediately after the assessm ent of said personal
property is m ade. Public U tility corporations are taxed for the
support of th e S tate other property is taxed for county and city
purposes.
W ills. E very person over th e age of eighteen years, of sound
m ind, m ay, by last will, dispose of all his estate, real and personal.
A m arried woman m ay dispose of all her separate estate by will with­
out th e consent of her husband, and m ay alter or revoke the will in like
m anner as if she were single; she m ay also dispose of b y will one-half
of the' com m unity property. H er will m ust be executed and proved
in like m anner as other wills. E very will other than a nuncupative
will m ust be in writing, and every will o ther th an an holographic
will and a nuncupative will, m ust be executed and attested as follows:
1. I t m ust be subscribed a t th e end thereof by the testa to r himself,
or some person in his presence, and by his direction m ust subscribe
his nam e thereto. 2. T he subscription m ust be m ade in the presence
of th e attesting witnesses, or acknowledged by the testa to r to them
to have been m ade by him or by his authority. 3. T he testa to r
m ust, a t th e tim e of subscribing or acknowledging th e same, declare
to th e attesting witnesses th a t th e instrum ent is his will, and 4.
T here m ust be two attesting witnesses, each of whom m ust sign his
nam e as a witness a t th e end of the will, a t th e te sta to r’s request,
and in his presence and in th e presence of each other. An holo­
graphic will is one th a t is entirely w ritten, dated, and signed by the
hand ot th e testa to r himself. I t is subject to no other form, and
m ay be m ade in or o ut of this State, and need not be witnessed. A
witness to a will should always w rite his nam e and residence. All
devises or gifts to a subscribing witness are void unless there are two
other com petent subscribing witnesses. No will m ade out of this
S tate is valid as a' will in this S tate, unless executed according to the
provisions of th e code, except th a t a will m ade in a S tate or country
in which th e testa to r Is domiciled a t th e tim e of his death, and valid
as a will under th e laws of such S tate or country is valid in this S tate
as to personal property. Wills proven out of sta te m ay be recorded
in county where testa to r has left over estate.
Bequests for charity are void unless m ade more th an th irty days
before death and m ust in no case exceed more than one third of the
estate unless th ere are no legal heirs. Wills are revoked by m arriage
unless provision for the same or an intention not to provide clearly
appears.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

SYNOPSIS OF

THE LAW S OF COLORADO
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by M e s s r s . G a r w o o d a n d G a r w o o d , A ttorneys a t Law,
E rnest & C ranm er Bldg., D enver. (See Card in A ttorneys’ List.)
A c k n o w le d g m e n ts. Of deeds and instrum ents concerning real
estate, m ay be taken as follows : —
1. W ithin this S tate, before any judge, clerk, or th e deputy clerk
of any court of record, clerk, and recorder of any county, or his deputy,
or n otary public, or before any justice of the peace within his county!
2. O ut of this S tate and within the U nited S tates before the
secretary of any such S tate or T erritory, th e clerk of any court of
record, any notary public, or any commissioner of deeds for any
such foreign S tate or T erritory appointed under th e laws of this
State; before any other officer authorized by th e laws of any such
S tate or T erritory to take and certify such acknowledgment; provided,
there shall be affixed to the certificate of such officer, other than
those above enum erated, a certificate by the clerk of some court
of record of the county, city or district wherein such officer resides,
under the seal o f such court, as to the official capacity, tru e signature
and authority of th e person certifying such acknowledgment.
3. O ut of th e United States, before any judge, clerk, or deputy
clerk, of any court of record of any foreign kingdom, empire, republic
state, principality, province, colony, island possession or bailiwick,
before the chief m agistrate 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 diplom atic consular or commercial
agent or representative, or deputy of any thereof, of the United
States or any other governm ent or country appointed to reside in
th e foreign country or place where the acknowledgm ent is made,
each and all certifying sam e under his official seal.
4. O ut of th e S tate, and within any colony, island possession
or bailiwick of the U nited States, before any such officer as above
enum erated in relation to acknowledgments in foreign countries
(except ambassadors, etc.) or before any notary public, having a
seal.
A ctio n s. T he distinction between th e forms of actions a t law and
suits in equity is abolished. All actions m ust be prosecuted by the
p arty in interest, and are governed by a code of civil procedure.
A d m in is tr a tio n of E s ta te s . All dem ands not exhibited in twelve
m onths are barred, unless such creditor can find other estate of the
deceased not inventoried, saving, however, to femmes covert, persons
of unsound minds, imprisoned or beyond the seas, the term of one
year after their disability has been removed to exhibit their claims.
Creditors having liens on the property of the decedent can not fore­
close for one year unless perm itted by the court and in no event
until the claim has been allowed. Adm inistration is granted to
surviving husband or widow, or next of kin of an intestate, if they
will accept or are n ot disqualified; if no such relative appears within
tw enty days after d eath of intestate, adm inistration m ay 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 relinquishment
county judge m ay select adm inistrator. In counties having a popu­
lation of more th an 50,000 'o n default of relatives administration
is m ade by public adm inistrator. An abbreviated form of adminis­
tratio n is provided for estates of $2,000 or less. (See Wills; Husband
and Wife; D escents and Distributions.)
A g e n t. (See P artnerships.)
A liens. C annot h u n t or possess firearms.
A r b itra tio n . Differences m ay be subm itted to arbitration by
consent of the parties in the form prescribed by sta tu te, and a judg­
m ent m ay be entered by the clerk of th e D istrict C ourt upon the
finding of the arbitrators.
A rre s t. Im prisonm ent for debt, except in cases where one refuses
to deliver up his estate for the benefit of his creditors, or in cases
of to rt or where there is a strong presum ption of fraud, is abolished.
In civil actions founded upon to rt, where the finding is in favor of the
plaintiff and th e verdict states th a t defendant was guilty of fraud;
malice, or willful deceit, execution m ay issue against the body of
the defendant, b u t not where the defendant shall have been con­
victed in a criminal proceeding for th e sam e wrong. Imprison­
m ent shall not exceed one year, and the prisoner is released upon
paym ent of th e debt. The w rit of ne exeat is granted under proper
circum stances. (See F raudulent Purchasers.)
A s sig n m e n t. Assignments for th e benefit of creditors may be
m ade in accordance w ith provisions of the Assignment Act. Assign­
m ents of wages not covered a t th e tim e of th e assignment, or of
other sums to become due to th e assignor, are invalid unless recorded
with th e recorder of the county where the wages are to be earned,
or th e sums are to becom e due, within five days from date thereof.
If the assignor is a m arried m an or woman, residing with the wife
or husband, he or she m ust join in the assignm ent. There are also
provisions regulating assignm ents to wage-brokers and others.
A tta c h m e n ts . In actions on contracts, express or implied, the
laintiff m ay have the defendant's p roperty attached, upon filing a
ond in double th e am ount sued fori with affidavit of plaintiff, his
agent or attorney, setting forth th e am ount and nature of the debt
claimed, and one or more of the following grounds of attachm ent:
1. T h at defendant is a non-resident. 2. A foreign corporation. 3. A
corporation whose chief office or business is o ut of th is State. 4. Is
evading service, or has been absent from S tate for four months, while
debt has been overdue. 5. Is about to remove his property out of
State. 6. H as fraudulently conveyed, or (7) fra-dulently 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 th is State, with the
intention of having his effects rem oved from th is 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 per­
formed, or for any service rendered by plaintiff, for defendant, to be
paid for upon completion. 12. T h at the defendant fraudulently,
contracted th e debt, or procured the m oney or property of the plain­
tiff. In justice courts, th e fact th a t th e d eb t is for farm products,
house rent, household furniture and furnishing, fuel, groceries ana
provisions, clothing and w earing apparel for th e debtor or his family,
is additional ground for attachm ent. Garnishee process will issue m
aid of attachm ent when money or property of th e debtor is found m
possession of third persons, property of non-residents and absconding
debtors can be attached as in m ost other States.
H an k s, S ta te . Any num ber of persons, n ot less th an three, may
engage in th e business of banking: th e capital stock m ust not be less
than from $10,000 to $50,000 dependent upon population, all of wmcn
m ust be paid in cash before commencing banking business, and cer­
tificate thereof filed. Generally no bank m ay take as security a
lien on any p a rt of its capital stock; nor tak e as security a hen on

BA N K IN G A ND COM M ERCIAL LAWS—COLORADO
any p art of th e capital stock of o ther banks; nor take as security a
lien for any person on more th an 25 per cent of the to tal shares of
any other bank; nor m ay it hold or purchase any portion of its own
stock, or of th e capital stock of any other corporation, unless such
purchase is necessary to prevent loss upon a debt previously con­
tracted in good faith, or in other peculiar circumstances. Stock so
purchased m ust be sold within three years, and sooner if this can be
done without im pairing the bank's investm ent. Shareholders in
banks, savings banks, tru st deposit and security associations shall be
held individually responsible for debts, contracts, and engagements of
said association in double th e am ount 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 deem ed guilty of a felony, and,
on conviction, punished by im prisonm ent in th e penitentiary for not
more then twenty, years, or b y a fine of n ot more th an $2,000, or both,
and in addition shall be individually responsible for the property
received. F ailure of th e bank or banker w ithin th irty days after
receipt of such money or property is prim a facie evidence of knowledge
of the insolvency a t th e tim e of such receipt. Loans to any one
individual or corporation are lim ited to 20 per cent of the paid in
stock and surplus of th e bank. Loans secured on real estate lim ited
to 25 per cent of to tal interest bearing securities and to a period of
three years, b u t further loans allowed secured by first m ortgage on
real estate worth double am ount of loan lim ited to 50 per cent of
saving deposits and to a period of five years. No bank m ay 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 satis­
faction of previously existing loans m ade in good faith. Any realty so
acquired m ust be sold in five years, or sooner if possible. No director
may borrow m oney in excess of 10 per cent of th e capital and surplus,
without th e consent of a m ajority of th e directors other th an the
borrower. No bank shall loan to any officer or employe thereof.
All banks except N ational Banks, are under the supervision of the
State Bank Commissioner who examines each institution a t least
twice yearly. If he finds capital im paired, he requires the bank to
make up deficiency, or takes possession for purposes of liquidation,
as circumstances m ay require. Insolvent banks m ay be placed in con­
trol of the S tate Bank Commissioner. Usually no receiver can be
appointed, nor can a bank m ake an assignm ent for creditors. E very
bank makes reports of its condition to the commissioner five tim es
yearly. No bank can do business w ithout a certificate of authority
from the commissioner. Savings banks are subject to the sta te
banking law under a num ber of special provisions and restrictions.
Bills of E x ch an g e. (See Commercial Paper.)
Bills o f L adlxfe a n d P ro m is so ry N o tes. (See Commercial Paper.)
B lue S ky L aw . On August 1, 1923, all corporations organized in
Colorado who desire to place on sale to the public, securities in certain
classes m ust comply w ith th e ' ‘Securities A c t” or “ Blue Sky Law”
which provides th a t two copies of prospectus issued shall be filed with
the Secretary of S tate setting forth certain inform ation w ith reference
to the com pany and th e Secretary of S tate shall charge and collect a
fee of $10 for th e filing of such prospectus.
C h a tte l M o rtg a g e s when recorded are good for two years where
sum secured does not exceed $2,500; for five years, when sum does not
exceed $20,000, and n ot exceeding ten years where sum secured
exceeds $20,000; b u t if the sum secured be greater th an $2,500 m ort­
gagee m ust annually record statem ent stating th a t the m ortgage
secures a bona fide indebtedness, the portion which has been paid,
and the am ount still due. C hattel m ortgages m ay be extended
after m aturity, but n ot more than th irty days after, m aturity, by
filing an executed instrum ent of extension of m ortgage w ith the
county recorder. As between the parties thereto, all chattel m ort­
gages are good until the indebtedness is paid or is barred by the
statute of lim itations. M ortgages of stocks of goods which reserve
possession and power of sale to m ortgagor, are void as against cred­
itors and bona fide purchasers. Disposing of m ortgaged »property
is larceny. C nattei mortgagee, his agent or attorney, now allowed
thirty days a fter m atu rity of debt in which to take possession of
mortgaged chattels, and during said th irty days, or until possession
Js taken by mortgagee, his agent or attorney, the m ortgagor shall
have the right to pay said debt and have m ortgage discharged as if
debt had been paid a t m aturity. C hattel m ortgages, securing the
purchase price of any article may, a t any tim e within th irty days
after the m atu rity of the indebtedness, be extended by th e m ortgagee
ror a period not exceeding two years, and for like periods thereafter.
Chattel m ortgages upon household goods used by the fam ily, when
made by husband or wife residing with th e other, m ust be m ade
by husband and wife jointly.
C o llaterals. Persons holding stocks in corporations as collateral
security not personally liable as stockholders for corporate debts.
A pledgee of stock m ay nevertheless represent same a t corporate
meetings. T ransfer of stock either in pledge or otherwise, m ust be
noted on the books of th e com pany w ithin sixty days or th e transfer
void for some purposes.
C o m m ercial P a p e r. To be negotiable, an instrum ent m ust con­
tain an unconditional order or promise to pay to order, or to bearer,
a certain sum of money or dem and, on a t a fixed or determ inable
time or tim es. The instrum ent m ay authorize th a t upon default
of payment of any installm ent, or of interest, th e whole shall become
due, and in case of non-paym ent, the sale of collateral securities,
or confession of judgm ent, or waive benefit of any law intended
for the advantage of the obligor. An instrum ent payable on con­
tingency is n o t negotiable. The date expressed is prim a facie the
true date. One in possession of an incomplete instrum ent has prim a
facie authority to fill in the blanks, b u t authority m ust be strictly
pursued. Consideration is prim a facie presumed. A pre-existing
debt is a valuable consideration. An accommodation p arty is liable
to a holder for value w ith notice. Two or more payees, unless p a rt­
ners, must all indorse unless one has authority for ali. An instrum ent
payable to a person as cashier or other fiscal officer of a bank or corpo­
ration is deemed prim a facie payable to th e bank or corporation, and
jnay be indorsed by th e corporation or by the officer. For one to
be a holder in due coursé the instrum ent m ust be complete and regular,
and taken in good faith for value before overdue, and w ithout notice
of any infirmity in th e instrum ent or defect in title. Holder is deemed
prima facie holder in due course; b u t when the title of a person who
negotiated it is shown to be defective, th e burden is upon the
bolder to prove himself a holder in due course. A qualified indorser
warrants the genuineness of the instrum ent; th a t he has a good title,
and th at he has no knowledge of any invalidity. An unqualified
indorser w arrants th e instrum ent valid and subsisting. One indorsing
an instrument negotiable by delivery, is liable as indorser. Except
wnen excused, presentm ent for paym ent, or acceptance, on th é day
wnen due is necessary to charge draw er or indorser of an instrum ent,
presentment m ust be m ade on due day, and notice of non-acceptance
P.r non-payment given on next business day to all parties prim arily
liable unless one has au thority for all. E very negotiable instrum ent
“ Payable a t th e tim e fixed w ithout grace. W aiver of protest is
ueemed a waiver of form al protest, presentm ent, and notice of dis­
honor. P rotest is required only in case of dishonored bills appeartheir face to be foreign. I t is optional in case of other negoirii ,i instrum ents. Bills draw n and payable within this S tate are
inland; others are foreign. P arties secondarily liable are discharged
■¡•vfxtension of tim e o f paym ent. P aym ent by a p a rty secondarily
**"“ 16! unless an accom m odation party, does n ot discharge th e instru­
ment, but he m ay agin negotiate it. A qualified acceptance disLnarges drawer and indorser unless th ey assent. Assent is presumed
r**'e.r. notice, unless th ey dissent. Holder can refuse to receive a
qualified acceptance. No presentm ent for paym ent is necessary
_i
“iter
.
non-acceptance.
p
.
xx
A unote
uw u
draw
lobu
n to
iu r
mn aaker’s
nui o u
order
i u d i iis
s u
nuotu LUillcom­
Lue e unless indorsed by him . A check m ust be presented within


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1721

a reasonable tim e or draw er will be discharged to the exten t of th e
loss caused by th e delay. The bank is n o t liable to th e holder until
it accepts or certifies th e check. W hen not otherwise provided by
this act, th e law m erchant prevails. T his act applies only to instru­
m ents executed on or after July 20, 1897. All instrum ents falling
due on Sunday or holiday are payable th e next business day. In
D enver, during June, Ju ly and August, S aturday from twelve o’clock
noon until twelve m idnight is a holiday, b u t negotiable instrum ents
falling due on S aturday are payable and protestable on Saturday or
next business day a t th e option of th e holder. The provisions con­
cerning commercial paper, in th is sta te are practically the sam e as
in all states where the. Negotiable Instrum ents A ct has been adopted.
C on v ey an ces. No joint tenancy in real property unless expressly
declared in th e deed, except in certain particular cases. Unless
so declared grantees shall be deem ed ten an ts in common, Lands
not in possession m ay be conveyed. N ot necessary for wife to join
in deed except in a conveyance of or a m ortgage of a hom estead,
entered as such of record. W itnesses are unnecessary. Seals are
n ot necessary b u t a printed or ink seal is advisable. Unacknowl­
edged deeds are deem ed notice from th e date of filing b ut th ey can
not be read in evidence unless subsequently acknowledged or proved,
unless th ey are on record for over th irty years. (See Acknowledg­
m ents; H usband and Wife.)
C o rp o ra tio n s . T hree or m ore persons m ay form a corpora­
tion by filing a certificate in th e proper offices, stating th e nam e,
objects for which organized, am ount of capital stock (the par value
of each share shall be in such sum not exceeding $100.00 per share
as is provided for in th e certificate of incorporation or such shares
m ay be issued w ithout any nom inal or par value), term of
existence (not to exceed tw enty years, except in particular cases),
num ber of directors (not less th an three or more th an thirteen), and
nam es of those to m anage the corporation for th e first year, th e place
where principal office is to be kept, and counties in which its business
is to be carried oh. If p a rt of the com pany’s business is to be carried
on beyond th e lim its of the S tate, th a t fact shall also be stated in
the certificate. The certificate shall also sta te w hether or n ot cum ula­
tive voting shall be perm itted. Fee for filing Articles of Incorporation
of dom estic companies is $20. and 20 cents on each thousand dollars
in excess of $50,000. Foreign corporations $30, and 30 cents on each
thousand dollars in excess of $50,000 represented by capital, property
and assets employed and-located in Colorado. D irectors of a mining
or m anufacturing corporation cannot encum ber the mines or plan t
of such corporation until th e question has been subm itted to the
stockholders and a m ajority vote of all the shares of stock has been
m ade in favor of such proposition; and such m ortgage or encum brance
w ithout such consent is absolutely void. Cum ulative m ethod of
balloting for directors is perm itted. Stockholders are liable for
corporate debts to th e am ount unpaid upon the stock, except th a t
stockholders in banks, savings banks, tru st, deposit, and security
associations are Individually responsible in double th e am ount of th e
par valye of their stock. When the stock becomes fully paid up, a
certificate to th a t effect should be filed. The directors are required
annually, and within sixty days from Jan u ary 1st, to file a report
stating the am ount of th e capital stock the proportion actually paid
in, and the am ount of existing debts, together with m any other
particulars. A failure to file such report m akes all the directors and
officers of th e com pany jointly and severally liable for all the debts
of th e com pany contracted during the year next preceding th e tim e
when such report should have been filed, and until such report shall
be m ade and filed, and subjects president and secretary to a fine of
n ot less th an $1,000. No m eetings of the board of directors can be
held outside the S tate unless so provided by th e Articles of incor­
poration. Corporations m ay be dissolved by a tw o-thirds vote of
the entire stock. A corporation under th e laws of Colorado, m ay
extend its charter by special m eeting of the stockholders, called
by 10 per cent of the entire capital stock. Corporate life shall be
renewed for entire term , not exceeding tw enty years. Foreign
corporations doing business in this S tate are not allowed a longer
term of corporate existence than dom estic corporations 6f. like char­
acter, b u t m ust file renewal certificates and pay fees therefor in the
same m anner as dom estic corporations, provided th a t such renewal
m ust not extend the life of the foreign corporation beyond th e term
fixed by the S tate where it was organized. Generally no foreign
corporation shall have or exercise any corporate powers or hold or
acquire any real or personal property, franchises, rights, or privileges,
or be perm itted to ao any business or prosecute or defend any s u it in
this State, until it has filed in the proper offices copy of its charter and
incorporation act, and designated an agent upon whom service of
process can be m ade, and until all prescribed fees including license
tax, shall have been paid, and until issuance of a certificate setting
forth such full paym ent.
In addition to all other fees and taxes, every domestic corporation
shall pay on or before th e first day of M ay of each year an annual
S tate corporation license tax to th e secretary of th e S tate of Colorado,
of ten dollars on a capitalization of one hundred thousand dollars or
less and ten cents on each one thousand dollars or fractional p a rt
thereof, when the capitalization is more th an one hundred thousand
dollars, and every foreign corporation shall pay a t th e sam e rate
upon th a t proportion of its capital, property and assets located and
employed in Colorado.
O ther provisions of th e Revenue bill, approved August 4, 1917,
and this act regarding annual reports, assessm ent of tangible and
intangible property, etc., too voluminous to be quoted, m ake it
advisable th a t care should be exercised by both dom estic and for­
eign corporations operating in the S tate to acquaint themselves fully
with its requirem ents. (See G uaranty Com panies; T rust Companies;
T ransfer of Corporation Stock.) ’
S e c u ritie s A ct. (See Blue Sky Law.)
C o u rts . Justices of the peace have jurisdiction in m atters involv­
ing less th an $300, county courts in m atters involving less th an
$2,000, except in the adm inistration of estates, where jurisdiction
is unlim ited. T he district court is the court of general jurisdiction.
The suprem e court is the court of final appeal, and also has some
original jurisdiction, as in cases of habeas corpus, m andam us and
other rem edial writs.
D ays o f G race. Are abolished. (See Commercial Paper.)
D e p o sitio n s. T he deposition of a witness out of the S tate shall
be taken upoA commission issued by th e clerk of the court where
the suit is pending on th e application of either p arty on five days'
revious notice to th e other, which notice shall be accompanied
y a copy of the interrogatories to be attached to the commission.
I t m ay be issued to a person agreed upon by the parties or to an y
judge or justice of the peace, or to a commissioner appointed by th e
governor of th e State to take affidavits and depositions in other States
and Territories, or to a notary public. The adverse p arty m ay file
and have attached to the commission such cross-interrogatories as
he m ay desire. P arties m ay agree by w ritten stipulation to tak e
the deposition orally, or, upon proper cause shown, m ay obtain an
order of court directing it to be so taken. Depositions can be taken
a t any tim e after starting suit.
D e sc e n ts a n d D is tr ib u tio n s . T he estate of an intestate descends
one-half to th e surviving .husband or wife, and the residue to th e
surviving children and descendants of children, if any; if none,
then the whole descends to, such surviving husband or wife. Except
as enum erated th e 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. I f no children nor their descendants,
then to his father and m other, share and share alike, and if One dead,
then to the other; if no fath er or m other, th en to his brothers and
sisters, and to descendants of borthers and sisters who are dead,
the descendants collectively, taking th e share of th eir im m ediate
ancestors in equal parts. 3. I f none of th e foregoing living, then to

E

1722

BA N K IN G AND COM M ERCIAL LAWS—COLORADO

th e grandfather, grandm other, uncles, aunts and th eir descendants,
th e descendants taking collectively th e share of their im m ediate
ancestors in equal p arts. 4 . 1 : none of th e relatives above enu­
m erated be living, then to the nearest lineal ancestor and their descend­
ants, th e descendants collectively taking th e share of their im m ediate
ancestors in equal parts. All posthum ous children or descendants
of th e in testate, inherit as if born in th e lifetim e of th e intestate,
and all children of th e half blood and all legally adopted children
shall inherit as children of the whole blood. Illegitim ate children
inherit if parents subsequently interm arry.
D ow er. Common Law Dower and curtesy are abolished, as such,
b u t sta tu to ry half of husband and wife in each others estate is given
in lieu of old common law -dower and surtesy. (See Statutes.)
E x e c u tio n s. Executions m ay 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 d ebtor n ot exem pt, in th e county to which
it is issued, and it m ay be directed to th e sheriff of any county in
th e S tate. Executions m ay issue upon judgm ents a t any tim e after
five days from judgm ent and w ithin tw enty years from th e date of
en try b u t from and after tw enty years from th e en try of judgm ent, it is
considered satisfied unless revived as provided by law. D ebtor or
legal representative has six m onths to redeem land from sale under
execution. Judgm ent creditor has three m onths after expiration of
said six m onths. Judgm ents can be m ade a six year lien on real
estate of d ebtor by filing transcript w ith recorder of th e county where
the real eate is situated.
E x e m p tio n s . Hom estead, consisting of tow n house and lot or
lots, or of any farm to th e value of n ot to exceed $2,000, is exempt,
when such hom estead has been entered o f record as such, and is
occupied by a householder, th e head of a fam ily. Personal property
exem pt 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, n ot exceeding $100; provisions
and fuel for six m onths; tools, im plem ents, or stock in trade, up to
$200; one cow and calf, ten sheep and necessary food for six m onths;
working anim als up to $200; the library and im plem ents of a pro­
fessional m an up to $300; one bicycle and one sewing machine.
Persons n o t th e heads of fam ilies are entitled to tools, working animals,
and stock in trade, n ot exceeding $300 in value. W hen debtor is
head of family, or wife of head of fam ily, 60 per cent of wages due
a t tim e of levy, under execution, attachm ent, or garnishm ent, is
exem pt, when such fam ily resides in th e S tate and is dependent,
wholly or partially upon such earnings for support. If such wages
do n ot exceed $5.00 per week a t th e tim e of levy, th ey are entirely
exem pt.
F ra u d . P arties to any fraudulent sale of any lands, goods or
ch attels,' or who conceal, secrete, rem ove or dispose of any goods
or chattels, or are parties to any bond, suit, judgm ent, or execution,
contract o r conveyance had m ade, or contrived w ith in ten t to deceive
and defraud, or defeat, hinder, or delay creditors; are criminally
liable. One who purchases goods on credit under an assumed or
fictitious nam e w ith in ten t to defraud th e seller; or having purchased
goods on credit shall, w ith in ten t to deiraud th e seller, sell, hypothe­
cate, or otherwise dispose of them out of th e usual course of business,
or secrete himself, or abscond, shall be guilty of a m isdemeanor.
F ra u d s , S t a t u t e of. T he following m ust be i n writing; Con­
tracts for leasing of land for period longer th an one year or for the
sale of lands, or any interest in lands; every agreem ent which by
its term s is n ot to be performed within one year: every special
prom ise to answer for th e debt, default or miscarriage of another;
every agreem ent, promise, or undertaking m ade upon consideration
of m arriage, except m utual promises to m arry, and every contract
for th e sale of any goods, chattels, or things in action, for th e price
of $50 or more, unless th e buyer accepts and -receives p a rt of such
goods or th e evidence of some of them , or the buyer a t th e tim e
pays p a rt of th e purchase money. (See Sales of Personal P roperty.)
G a r n is h m e n t. (See A ttachm ents.)
H o lid ay s. T he following are legal holidays in Colorado: F irst
day of January. 12th day of F ebruary. 22nd day of F ebruary.
30th d ay o f M ay. 4 th day of July. 25th day of December. T hanks­
giving D ay. Arbor D ay, being 3rd F riday in April. Colorado Day,
being August 1st. L abor Day, being first M onday in Septem ber.
Colum bus D ay, being 12th day of October. In addition to th e above.
S aturday is a legal half holiday during June, July and August in all
cities of Colorado having a population of 25,000 and over. N ot all
th e above are legal holidays for every purpose.
H u s b a n d a n d W ife retain their separate property, real, personal
and mixed owned a t m arriage, and any such property which shall
come to either of them by descent, devise, or bequest, or the gift
of an y person, for th eir own separate use. Such property of the
wife is n o t liable for th e husband’s debts. Wife m ay carry on trade
or business, sue and be used, contract debts, and execute promissory
notes, bonds, bills of exchange, and o ther instrum ents precisely as
if sole and m ay convey real estate w ithout th e husband joining in
th e deed. Any chattel m ortgage upon, or sale of, th e household
goods used by the family, and any conveyance of, or m ortgage upon,
a hom estead, and any assignm ent of future wages, or sums to become
due in. th e future, when m ade by husband or wife residing w ith the
other, m ust be joined in by th a t other. A m arried woman m ay
m ake a will, b u t neither husband nor wife shall devise or bequeath
more th an half of his or her property aw ay from the other without
th e consent in writing of the other, executed after d eath of th e testator
or of testatrix. M arriage revokes a will previously m ade. The
husband is liable for th e debts and liabilities of th e wife contracted
before m arriage to th e extent of th e real and personal property he
m ay receive w ith or through her, or derive from th e sale or ren t of
h er lands, and no further. T he expenses of the fam ily and th e edu­
cation of th e children are chargeable upon th e property of both
husband and wife, and in relation thereto they m ay be sued jointly
or severally. E ith er husband or wife living together can separately
declare property of record in th e nam e of the other “ A Hom estead,
by an en try of record over his or her signature. N either can mortgage
nor convey hom estead w ithout th e signature of th e other.
I n t e r e s t . T he legal rate is 8 per cent, b u t any o ther ra te m ay be
fixed by agreem ent w ith th e exception of loans of $300 or less upon
which th e maxim um rate is 12 per cent. E ight per cent is allowed
on overdue bonds, bills, prom issory notes, and judgm ents. C ounty
town, and City w arrants and other like evidences or certificates of
m unicipal indebtedness bear 6 per cent interest from presentation.
J u d g m e n ts . A tran scrip t of judgm ent m ay be filed in th e office
of th e county clerk and recorder of any County in th e State, and
thereupon such judgm ent becomes a lien upon all real property
owned by th e judgm ent debtor in th a t county. T he lien holds for
six years from th e date upon which filed (and successive transcripts
m ay be filed.) An unsatisfied judgm ent should be revived every
tw enty years. (See Executions.)
L im ita tio n s . Actions for th e recovery of land m ust be brought
within tw enty years after accrual of right. Actions for the recovery
of lands actually occupied by another under a connected title deducible of record or under tax or execution or other sale ordered by
court m ust be brought w ithin seven years after possession taken.
I f title is acquired after taking possession, sta tu te rims from date
of acquiring title. Actual possession of land for seven years under
claim and color of title w ith paym ent of all taxes for Said period,
constitutes the possessor owner according to th e purport of his paper
title. T he sam e is tru e of v acant and unoccupied lands, unless some­
one w ith a b e tte r paper title pays th e taxes for one or more years
during such term of seven years. Actions of d eb t founded upon
co n tract express or implied; upon judgm ents of courts not courts of
record; for arrears of ren t; of assum psit—or ease founded on any
contract; for waste and trespass on land and for replevin, m ust be


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

begun w ithin six years after the cause of action accrues; Actions
against sheriffs and coroners, for liability incurred by them in their
official capacity, shall be brought within one year after th e cause of
action accrues, also actions for assault and battery , false imprison­
m ent, slander and libel; also actions for penalties or forfeitures of
penal statutes. Bills of relief for fraud m ust be filed within three
years after discovery, in case of a tru st n ot cognizable by the courts
of common law within five years. In actions accruing out of the
S tate upon contract, express or implied, or upon any sealed instru­
m ent in writing, or judgm ent or decree of any court, more than six
years before th e com m encem ent of the action the sta tu te of limita­
tions m ay be pleaded in bar of recovery. I f a judgm ent has been
rendered w ithout this S tate more th an three m onths before suit in
th is S tate, and is based on a cause of action more th an six years old,
such cause of action can be pleaded in bar of th e judgm ent. The
constitutionality of this la tte r provision has, however, been attacked
and is very doubtful. (See 117 Fed. 400.)
M a rrie d W o m e n . (See H usband and Wife.)
M e c h a n ic s’ L ie n s. M echanics, m aterial-m en, contractors, sub­
contractors, builders, miners, and all persons of every class performing
labor upon, or furnishing m aterials used in th e construction or repair
of any building, or any other structure or im provem ent upon land,
also all who have rendered th eir professional, skilled service upon
such structure, have a lien upon the property, also those who work or
furnish m aterials or m achinery for th e working of a mining claim
or mineral deposit shall have a sim ilar lien. Liens ran k in the follow­
ing order: 1. L aborers or m echanics working by th e day or piece,
w ithout furnishing m aterial. 2. Sub-contractors and material-men,
whose claims are either entirely or principally for m aterials, machinery
or other fixtures. 3. All principal contractors. Laborers are allowed
one m onth, m aterial m en two m onths, and th e original contractor
th ree m onths a fter the com pletion of th e structure, within which to
file claim of lien. Action' to enforce such lien m ust be commenced
within six m onths a fter com pletion of th e building upon which it is
claimed.
M o rtg ag es. O rdinary m ortgages on realty are in common use;
also deeds of tru st to a public trustee and to private trustees. A
tru st deed to private trustee is foreclosed as to a m ortgage. In case
th e public trustee is nam ed, the property is sold by him as provided
in the deed, after advertisem ent in a newspaper designated in the
tru st deed, and such advertisem ent shall n ot be less th an four weeks.
Upon a sale by the public trustee, a certificate of sale is issued. A
subsequent incum brancer m ay redeem by paying th e amount bid.
and th e sum so paid shall be added to th e am ount of the subsequent
encum brance. T he grantor in the tru st deed, or his assigns may
redeem from sale within six m onths. A fter six m onths, and within
nine m onths, a judgm ent creditor m ay redeem . Affter th e expiration
of the period of redem ption the public trustee executes a deed to
the property to the holder of th e certificate of sale, which is assignable.
Redem ption from sales of m ortgaged property th e sam e as sales under
executions.
N o tes a n d B ills of E x c h a n g e . (See Commercial Paper.)
P a r tn e r s h ip s , L im ite d a n d S p ecial. A lim ited partnership
m ay consist -of one or more general partners, jointly and severally
liable and one or more special p artners contributing a specified
am ount of cash or property, who are n ot liable for the debts of the
partnership beyond the am ount so contributed. Only the general
partners can bind the firm. A certificate m ust be signed, acknowl­
edged, published, and filed of record giving details of partnership
All persons doing business under any nam e other th an their per­
sonal names, m ust file an affidavit showing the real persons repre­
sented, or they m ay not bring suits upon debts due, and may be
convicted and fined.
P ow ers of A tto rn e y . Powers of attorney for th e conveyance
of lands m ust be acknowledged in th e sam e m anner as deeds, and
m ust be recorded in the sam e county w herein th e real property to
be conveyed is situate.
P ro te s t. (See Commercial Paper.)
R e p le v in . A w rit of replevin m ay issue in any su it to recover
possession of personal property upon filing a bond in double the
value of th e property, with affidavit of ownership or right to pos­
session, wrongful detention and value of property, etc. Redelivery
bond in sim ilar am ount m ay be given by defendant in forty-eight
hours a fter levy.
S ales of P e rs o n a l P ro p e rty . E very sale or assignm ent of goods
and chattels in th e possession or under th e control of the vendor
is void, as against creditors or subsequent purchasers in good faith.
Unless accompanied by im m ediate delivery and followed by actual
and continued change of possession. Sales of an y portion of a stock
of m erchandise otherwise th an in the ordinary course of trade are
prim a facie fradulent and void against creditors, unless seller and
purchaser together, before sale, m ake inventory, showing quantity,
and cost price of the various articles; and unless purchaser makes
fUIl inquiry of the seller as to nam es and addresses of all creditors
of seller, and the am ount due to each, and obtains an answer; and
notifies each creditor of th e proposed sale, the cost price, and the
proposed selling price; and unless th e purchaser retains the inventory
and w ritten answer a t least six m onths after th e 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 H usband and Wife.)
S u its . (See Actions.)
T axes are generally a lien on real estate until paid, as also upon
stocks of goods including new goods added thereto. Taxes may
be paid in two sem i-annual installm ents; th e first on or before the
last day of F ebruary, and the residue on or before the last day oi
July of the year following the one in which they are assessed, lax
sales are held in Novem ber when tax certificates are given to pur­
chasers on which treasurer’s deed m ay issue after three years. • Real
estate sold for taxes redeem ed any tim e until treasu rer’s deed issues.
All mines and mining property of th e class heretofore exempted Dy
the constitution of th e S tate shall be assessed and taxed and tne
taxes levied and enforced by sale of the property taxed m aeiarn®
of paym ent, as is provided by law in th e case of o th er classes of taxaDie
real properties. D elinquent taxes carry interest a t th e rate of 12 t°
18 per cent per annum . Household goods to the value of $200 belong­
ing to a head of a fam ily are exem pt.
W ills. M ales of th e age of tw enty-one years, and females of
the age of twenty-one years, m ay dispose of th eir real and p e rs o n a l
property by will b u t personal property m ay be disposed of by wuj
by any person of th e age of seventeen years. For restrictions as w
m arried persons, see “ H usband and W ife.” All wills, whether oi
realty or personalty shall be in w riting signed by the testator or
some one for him in his presence and a t his direction, and attesieu
in his presence by two or more credible witnesses. Unless otherwise
expressed in the will an after-born child will share in the propertyDevises and bequests to witnesses are null and void, unless tne wo
be attested hy a sufficient num ber of witnesses exclusive or suou
persons. No will can be revoked otherwise th an by tme suosequeu
m arriage of the testato r, or by burning, tearing, or obliterating r
same by th e testator, or in his presence and by his direction a
consent, or hy another will or credit, declaring th e same, duly sign
and witnessed, or by a formal annulm ent thereof. The proper j
devised by will m ust be adm inistered by the county court, ana
property of non-residents m ust generally be adm inistered to ciearw
to real property situated in this State. (See H usband and vvi ,
Descents and D istributions. A dm inistration of Estates.)

BA NKING AND COM M ERCIAL LAWS—CO N N ECTICU T
SYNOPSIS OF

THE LAWS OF CONNECTICUT
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by F i e l d , D u r a n t & L e v e r e , A ttorneys a t Law, 129
C hurch St., New H aven.
A ccounts. In all actions for a book debt, the entries of the
parties in th eir respective books shall be admissible in evidence.
(For lim itation of actions on accounts, see Lim itations to Suits.)
A c k n o w le d g m e n ts . (See Conveyances.)
Actions. T here is b u t one form of civil action. M esne process
in civil actions consists of a w rit of summons or attachm ent, describ­
ing the parties, the court to which it is returnable, and the tim e and
place of appearance, and embodies the plaintiff’s com plaint. 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 statem ent of th e facts con­
stituting th e cause of action and a dem and for relief, and legal and
equitable relief m ay be dem anded in the sam e action, except in actions
before justices of th e peace, who have no equity jurisdiction.
A d m in istra tio n o f E s ta te s . The probate court has jurisdic­
tion of deceased estates. Adm inistration on intestate estates is
granted to th e 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 appointm ent found reasonable by the court, th en to any other
person whom th e court deems proper. Bonds, which m ust be fur­
nished by the adm inistrators or executors, are usually m ade double
the estimated value of th e personal property. Bonds of surety com­
panies authorized to do business in the S tate m ay be accepted. Where
the will waives the bond a nom inal bond is required, usually in double
the amount of th e debts of the testator. Deceased estates m ay be
settled as solvent or insolvent. N ot less than six m onths 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 th e estate is solvent, or to commissioners
appointed by th e probate court if the estate is insolvent. Creditors
not inhabitants of th is S tate m ay exhibit their claims against any
estate which has n o t been represented insolvent, a t any tim e within
one year after order of notice, and if presented more th an six m onths
after order of notice, shall be entitled to paym ent only out of the clear
estate remaining after paym ent of claims exhibited within time
limited. Suit m ust be brought within four m onths from the tim e
of receiving w ritten notice from the adm inistrator or executor of a
solvent estate of the disallowance of a claim. Twelve m onths is the
usual time allowed for th e settlem ent of deceased estates. Admin­
istrators and executors m ay m ortgage real estate if shown to be for
benefit of th e 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 U nited States, and
any citizen of France, so long as France shall accord th e same rignt
to citizens of th e U nited States, m ay purchase, hold, inherit, or
transfer real estate in this S tate in as full a m anner as native-born
citizens.
A rb itratio n . P arties to any controversy desiring to subm it the
same to arbitration under a rule of court, and having signed and
sworn to an agreem ent to th a t effect, m ay, upon filing this agree­
ment in the court having jurisdiction of the subject m atter, have
this agreement entered of record and obtain a rule of court th a t
the said parties shall subm it' to and be finally concluded by such
arbitration; or th e said parties m ay personally appear in court
and acknowledge th a t th ey have m utually decided to subm it their
controversy to the arb itration of certain nam ed persons and m ay
obtain a rule of court of sim ilar purport; or in case of an action
pending in court, if th e parties thereto desire to refer it to arb itra­
tion, each m ay choose one arb itrato r and the court appoint a third;
and in either of these th ree cases, the aw ard of the arbitrators being
returned and accepted by th e court, judgm ent shall be rendered
pursuant thereto, and execution granted thereon, w ith costs.
Arrest. The body is exem pt in ordinary actions for debts, except
ror money received by one acting in a fiduciary capacity, or where
mere is fraud in contracting th e debt or in concealing attachable
property so th a t it m ay n o t be reached by civil process. In actions
generally, no attach m en t shall be granted against the body except
ror fraud. A debtor com m itted to jail on civil process can be released
“tong p00r debtors’ oath. T he debtor will n ot be released if his
oath is overcome by reb u tting evidence.
I A ssignm ents in In so lv en cy . Operation of this section sus­
pended during continuance of U. S. B ankruptcy Act.
A ttach m en ts. A ttachm ent m ay be m ade upon the original
process, and is served by attaching th e goods or lands of th e defend¡mt. or, if sufficient goods be not found, the person in actions where
pnere is fraud in contracting th e debt or concealing property or refusHS to pay an adm itted debt. A ttachm ents m ay be granted upon all
complaints containing a money dem and. Supplem ental attachm ent
may be ordered by the court upon application a t any tim e during
Ï?® Pendency of th e action. If the plaintiff be a non-resident, he is
required to furnish a bond for prosecution from tw enty dollars to one
™nared and forty dollars, according to am ount attached. An attachflnoi j 5n exPires unless execution is levied within sixty days after
„““‘ lodgment upon th e attached personal property, or within four
mouths upon th e attached real estate. (See Exem ptions.)
»«?ks. (See S tate Banks and T rust Cos.)
jSS*. of E x ch an g e. (See N otes and Bills.)
“ JJ‘S of L a d in g . Uniform Bills of Lading Act passed in 1911.
Interest)1 M o rtg a g o s- <See M ortgages. Conditional Sales, and
Collateral I n h e r ita n c e o r S u ccessio n T ax. (See Taxes.)
C onditional S ales. All contracts for the sale of personal propm m m t household furniture, musical Instrum ents, bicycles,
{monographs and phonograph supplies and such property as is by
title ®?emPf from attach m ent and execution, conditioned th a t the
wriH^ûe^?t0 sh&H rem ain in the vendor after delivery, m ust be in
knnmif^ describing th e property and all conditions of sale, and acvftnsio 8e?, before proper authority, and recorded in town where
salps eresides- if not m ade as required, they are held to be absolute
rentPQo w®*' 88 between the vendor and vendee or their personal
hsw „ ta , es* A crime to conceal or convey personal property
oew on such conditional sale.
C o u ^ ^ l i V - P ^ m a r y provisions of S tatu te of F rauds apply,
of am, h Pr°h ate having jurisdiction of the settlem ent of the estate
authori?60? ^ 64* Person m ay, concurrently with th e courts of equity,
dec«»,; "Ie . the executor or adm inistrator to convey the title of the
«asea in any real estate to any person entitled to it. by virtue


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1723

of any contract of such deceased person, and the court of probate
in which the guardian of any minor has been appointed m ay, in
like m anner, order such guardian to convey the interest of his ward
in any real estate which ought in equity to be conveyed to another
person. C ontracts for the conveyance of lands or of any interest
therein, m ay 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. C ontract of incapable person pending appointm ent of
conservator or of spendthrift pending appointm ent of overseer, void
when select m en have filed in town clerk’s office certified copy of
application in case of incapable person, and certified notice of pro­
posed appointm ent in case of spendthrift. N o 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
th a t it was so m ade until he restores such consideration. T he Uni­
form Sales Act passed in 1907 covers contracts to sell. (See Sales
by Retail Dealers.)
. C on v ey an ces. All conveyances of land m u s t . be in writing,
signed, sealed, and acknowledged by the grantor, and attested by
two subscribing witnesses. T he word “ seal” or th e letters (L. S.)
m ay be used for a seal. The acknowledgment is m ade by the grantor
before a judge of a court of record of this S tate or of 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 S tate or
T erritory of the United States, tben before h commissioner appointed
by the governor of this State, or any officer authorized to take th e
acknowledgment of deeds in such S tate or Territory, and if in a
foreign country, before any consul of th e U nited 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 S tate or T erritory, in conform ity w ith th e laws of such
State or T erritory, are valid, If the land conveyed belongs to th e
wife, the husband should join in th e conveyance, if m arried before
April 20, 1877. If the land conveyed belongs to th e husband, th e
wife need not join in th e conveyance. No separate exam ination of
a m arried woman is required in taking h er acknowledgment. Con­
veyances, including leases for more th an one year, to be effectual
against any other person th an the grantor and his heirs m ust be
recorded on the town records of the town in which the land lies.
C o rp o ra tio n s. Corporations m ay be formed under th e general
laws by three or more persons for the transaction of any lawful busi­
ness except th a t of bank, savings bank, tru st company, building
and loan association, insurance • company, surety and indem nity
com pany, steam railroad or street railway company, telegraph com­
pany, and gas and electric lighting, w ater company, or any company
which shall need to have the rig h t of em inent domain.
A certificate of incorporation m ust be filed, signed, and sworn to
BJ a t least three of the incorporators, giving th e nam e and location
of th e corporation, th e n atu re of the business, th e am ount of authorized
capital stock, which m ust n ot be less th an 82,000, num ber of shares
and par value of each, am ount of capital stock w ith which it will
commence business, which shall not be leSs th a n $1,000. A certified
copy m ust be filed in the town clerk’s office.
T he organization fee m ust be paid to th e State, of one dollar, on
every thousand of its authorized capital stock up to five million, no
paym ent to be less th an $50.
Stock m ay be paid for either in cash or property, b u t if in prop­
erty, a m ajority of the directors m ust m ake and sign upon a record
book a statem ent of th e am ount for which the property is received
and its actual value. In case of fraud in such valuation, directors
personally liable.
Certificate of organization m ust be signed and sworn to by a m ajority
of the directors and filed in the office of th e secretary of state, setting
forth th e am ount of stock subscribed for, am ount paid in cash and
in property, nam es and addresses of subscribers w ith num ber of
shares subscribed for, statem ent th a t th e directors are officers have
been duly elected and by-laws adopted, nam es and addresses of
directors, th e location of the principal office in th e S tate w ith th e
name of the agent in charge.
T here m ust be a t least three directors; vacancies in directors m ay
be filled by rem aining directors.
No stock can be issued until it has been paid for in full. Receipts
fur partial paym ents of stock m ay be issued by th e 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
it from the stockholder. The corporation m ay acquire its own
capital stock w ith the approval of three-fourths of th e stockholders,
given a t a m eeting called for th a t purpose.
Stockholders’ m eetings m ust be held in th is State.
Similar corporations m ay consolidates
A corporation m ay be wound up by voluntary agreem ent of all
stockholders, signed and acknowledged, directors acting as trustees
to wind up the business.
Receiver m ay be appointed on application of stockholders own­
ing one-tenth of th e stock, in case of fraud, m ism anagement, or if
assets are in danger of waste by attachm ent, or when corporation
has abandoned its business.
Annual statem ents m ust be filed in the office of th e secretary of
sta te and a certified copy thereof in the town clerk’s office, either
in Jan u ary or July, giving th e nam es and addresses of th e officers
and directors, am ount of outstanding stock n ot paid for in full with
the am ount due thereon, the location of th e principal office in this
S tate with the nam e of the agent in charge on whom process m ay
be served. For failure to file annual statem ent the corporation
m ay forfeit $25 to the S tate. .
Stock of no par value m ay be issued.
C o sts. For case before justice of th e peace, actual cash costs
not less th an $5; before city court from $10 to $50, according to
am ount involved; before court of common pleas or superior court,
not less th an $25; before suprem e court of errors, not less than $50.
A ttorney’s fees n ot included. A ttorney 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.)
C o u rts . T erm s 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 th ere are no courts of common pleas.
C ourt of common pleas in H artford, 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 C ounty has exclusive jurisdiction up to $1,000. N ot less th an four term s each
year are held in each of the counties nam ed, and there are city courts
in m any of the cities, and a district court a t W aterbury, w ith lim ited
civil jurisdiction, also tow n courts in m any of the towns. P rob ate
courts have jurisdiction of th e settlem ent of the estates of deceased,
insolvent, and incom petent persons, and are established in a large
num ber of probate districts—one for each district. Justices of th e
peace have civil jurisdiction up to $100. In New H aven and H a rt­
ford jurisdiction of justice of th e peace has been transferred to city
court, except in cases of sum m ary process and bastardy.
D ays of G race. (See N otes and Bills of Exchange.)
D eeds. (See Conveyances.)
D e p o sitio n s. M ay be taken in a civil action by a judge or clerk
of any court, justice of th e peace, notary public, or commissioner
of th e superior court, when witness lives out of th e State, or more
th an tw enty miles from place of trial, is over sixty years of age and
unable to atten d th e trial, is going to sea, or o ut of th e S tate, or by
age and infirm ity is unable to travel to court, or is confined in jail.

1724

BA N K IN G AND COM M ERCIAL LAWS—CO N N ECTIC U T

Reasonable notice m ust be given to adverse p arty . D eponents m ust
be cautioned to speak th e whole tru th , an a carefully examined.
T hey m ust subscribe their depositions and m ake oath before the
au th o rity taking th e same, who shall a tte s t th e sam e and certify
th a t th e adverse p a rty or his agent waSr present (if so), or th a t he
was notified, and shall also certify th e 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 th e p arty a t whose request it was taken.
Depositions m ay be taken in any o ther S tate or country by a notary
public, commissioner appointed by the governor of this State, or by
any m agistrate having power to adm inister oaths, and they m ay
also be taken before a foreign m inister, secretary of legation, consul,
or vice-consul appointed by th e U nited States, if taken o ut of the
U nited States. A judge of th e superior, common pleas, or district
court can issue a “ com m ission” to take th e deposition of a person
residing o ut of th is S tate, to be used in a cause pending before such
court. T he superior court, upon petition, m ay allow depositions to
be tak en to p erpetuate testim ony concerning th a t which m ay there­
after be th e subject of a suit. The person taking depositions m ay
compel attendance of witnesses by subpoena and capias.
D e s c e n t a n d D is tr ib u tio n of P ro p e rty i n I n t e s t a t e E s ta te s ,
(As to th e share of a surviving husband or wife, see the title H usband
and Wife.) A fter the share of the surviving husband or wife, the
residue of th e real or personal estate is distributed in equal propor­
tions am ong th e children and th e legal representatives of any of
th em who inay be dead (children who have received estate by advance­
m en t o f th e in testate in his lifetim e being charged w ith th e sam e in
th e distribution). If th ere be no children or legal representatives
thereof, such residue shall be distributed to th e parent or parents,
th en equally to th e brothers and sisters of the intestate of th e whole
blood, and those Who legally represent them ; and if there be no
such kindred, th en equally to th e brothers and sisters of the half
blood and those who legally represent them ; and if none, then equally
to th e next of kin in equal degree, kindred of th e whole blood to
tak e in preference to kindred of the half blood, in equal degree, and
ho representatives to be adm itted among collaterals after th e repre­
sentatives of brothers and sisters.
D o w er. (See H usband and Wife.)
E v id en ce. (See Courts, Insurance Com pany, Corporations.)
E x e c u tio n s. Issue on final judgm ent, and are returnable w ithin
sixty days. N o execution issued in an action founded on contract
m erely can be levied on th e body of th e debtor except for breach
of promise of m arriage, m isconduct or neglect in office or profes­
sional em ploym ent, or breach of tru st and cases where th e original
attach m en t is against th e body. Any judgm ent debtor, an execution
ag ain st whom shall have been returned unsatiflsed in whole or to
p a rt m ay be exam ined on oath touching his property and m eans of
paying such judgm ent, and m ay be com m itted for contem pt. (See
Exem ptions.) '
E x e m p tio n s . Hom estead, to th e value of $1,000, if declaration
to hold it as such is recorded. Of th e property of an y one person,
his necessary apparel and bedding and household furniture necessary
for supporting life; any pension m oneys received from th e United
S tates while in the hands of th e pensioner (which has been construed
to cover also such pension m oney when deposited in a savings b an k );
im plem ents of th e debtor’s trad e, his library n ot exceeding $500
in value- sundry dom estic anim als n ot exceeding $150 to value;
so m uch of any d eb t which has accrued by reason of th e personal
services of th e debtor as shall n ot exceed $15, including wages due for
th e personal services of any m inor child (but there shall be no exemp­
tion o f any deb t accrued b y reason of th e personal services of the
defendant against th e claim for the defendant’s personal board, or
for th e rental of any house or tenem ent occupied by th e defendant
as a place o f residence when such ren tal shall not exceed $25); of
th e p roperty of any one person having wife or family, two tons^ of
coal, specified am ounts of foodstuffs; th e horse of any physician
o r surgeon n ot exceeding $200 in value, and his saddle, bridle, h ar­
ness and buggy, also his bicycle; one boat owned by one person,
w ith rigging, tackle, etc., n ot exceeding $200 in value, used for plant­
ing or t.aiHhg oysters or clams or taking shad; one sewing machine
being p roperty of any one person using it, or having a fam ily; one
pew being property of any person having fam ily who ordinarily
occupy it?, and lots in any burying ground; and all benefits allowed
by an y association of persons in this S tate tow ard th e support of its
m embers, incapacitated by sickness or infirm ity, shall be exempted
from foreign attachm ent or execution.
F o re ig n A tta c h m e n ts . Goods concealed in th e hands of agents
or debts due th e defendant are reached by foreign attach m en t which
tak es th e place of garnishm ent. No assignm ent of future earnings
will prevent their attachm ent when earned unless m ade to secure
a bona fide debt, due a t th e date of such assignm ent, th e am ount
of which shall be sta te d therein as nearly as possible, nor unless
th e term for which th ey are assigned shall be definitely lim ited in
th e assignm ent, nor unless recorded before, such attachm ent in the
town clerk’s office in th e town where th e assignor resides, or if he
resides w ithout th e State, in th e tow n where th e em ployer resides, and
a copy left w ith th e employer. (See also Exem ptions.)
F o re ig n C o rp o ra tio n s . E very foreign corporation, except insur­
ance and surety com panies and building and loan associations and
investm ent companies (a corporation which has power to or does
sell or negotiate its own choses in action or sell, guarantee, or negotiate
th e choses in action of other persons or corporations as investm ents),
shall before transacting business in this State, file in th e office of
th e secretary of th e S tate a certified copy of its charter or certificate
of incorporation, together w ith a statem ent, signed and sworn to
b y its president, treasurer, and a m ajority of its directors, show­
ing th e am ount of its authorized capital stock and th e am ount thereof
which has been paid in, and, if any p a rt of such paym ent has been
m ade otherwise t h a n ' in cash, such statem ent shall set forth the
particulars thereof. Sec. 83.—E v ery foreign corporation w ith an
office or place of business in th is S tate, except insurance •companies,
su rety companies, and building and loan associations, shall, before
doing business in this S tate, appoint in w riting th e secterary of the
S tate and his successors in office to be its attorney, upon whom
all process in any action or proceeding against it m ay be served;
an d in such writing such corporation shall agree th a t any process
against it which is served on such secretary shall be of the same
legal force and validity as if served on th e corporation, and th a t
v such appointm ent shall continue in force as long as any liability
rem ains outstanding against th e corporation in this S tate, gaol1
w ritten appointm ent shall be acknowledged before some officer
authorized to tak e acknowledgments of deeds and shall be filed to
th e office of said secretary, and copies certified by him shall be suffi­
cient evidence of such appointm ent and agreem ent. Service upon
said attorney shall be sufficient service upon th e principal, and m ay
be m ade by leaving a duly attested copy of the process w ith the
secretary of th e S tate or a t his office. E very foreign corporation
doing business in th is S tate shall, within th irty days after an increase
o r reduction of its capital stock file in the office:of the secretary
of th e S tate a certificate substantially like th a t required of domestic
corporations organized under th e like Conditions. _The president and
treasurer of every foreign corporation doing business in this_ State
which is n ot required by law to m ake other annual returns in this
S tate, shall, annually, on or before th e fifteenth day of F ebruary or
August, m ake, sign, and sw ear to and file in th e office of th e secretary
o f th e S tate a certificate sim ilar to th e certificate required of domes­
tic corporations (See Corporations), except th a t such ^certificate
need n ot give th e nam e of th e agent or person in charge of its principal
office upon whom process against th e corporation m ay be served.
T he secretary shall thereupon record such certificate m a book kept
b y him for th a t purpose and shall furnish a certified copy to be re­
corded in th e office of th e town clerk of the town in this S tate in


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

which such corporation has its principal office or place of business
and said town clerk shall record th e sam e in a book k ep t by him
for th a t purpose. On th e fifteenth day of M arch and September
the town clerks of the several towns shall rep o rt to th e secretary
of th e S tate th e nam es of all corporations whose annual reports have
been filed for record during the preceding six m onths, in accordance
w ith th e provisions of this section, and th e secretary shall report
to th e attorney-general every six m onths th e nam es of all corporations
which have failed to comply w ith th e provisions of this section, and
th e attorney-general shall collect all forfeitures due under this sec­
tion. E very corporation whose officers shall fail to comply with
th e requirem ents of this section shall forfeit to th e State $100 for
each failure. T he attorney-general m ay rem it th is fine.
F o re ig n J u d g m e n ts . N o t conclusive on question of jurisdiction.
A foreign judgm ent when used by way of defence, is as conclusive
to every intent, as those of our own courts. I n an action on a judg­
m ent rendered in another State, evidence on th e p art of th e defend­
a n t th a t he had no legal notice of th e suit and did n o t appear, is
admissible, although the record of th e judgm ent stated th at the
defendant appeared by his attorney. W here the foreign court
has a peculiar and exclusive jurisdiction, its decree is binding upon
the judgm ent of any other court, into which th e same subject comes
im m ediately into controversy. A judgm ent rendered by a court
to one S tate has no efficacy when it is sought to be enforced in Con­
necticut, unless such court had jurisdiction of th e person against
whom it is rendered, acquired either by service upon him of the
rocess in th e suit, or actual notice to him of th e suit, or a t least by
is having appeared in it, and thus subm itting to th e jurisdiction
of th e court. Jurisdiction presumed to have been properly exercised,
if court once had jurisdiction. Notice presum ed of resumption of
jurisdiction if required by practice of foreign court. A judgment
recovered in a sister S tate is a bar to the fu rth er prosecution of an
action pending a t th e tim e in this S tate between th e same parties
on th e same cause of action. I t m akes no difference th a t the judg­
m ent of th e sister S tate has been appealed from, and th a t the appeal
Is still pending, where by th e laws of th a t State, such appeal operates
only as a proceeding! in error, and does n ot supersede th e judgment.
Only such pleas are pleadable to a foreign judgm ent, as are pleadable
when rendered.
F ra u d . All fraudulent conveyances, suits, judgm ents, executions,
or contracts, m ade or contrived w ith in ten t to avoid any debt or
d u ty belonging to others, shall, notw ithstanding any pretended con­
sideration therefor, be void against those persons only, their heirs,
executors, adm inistrators, or assigns, to whom such deb t or duty
belongs.
G a r n is h m e n t. (See Foreign A ttachm ents.)
G u a r a n ty C o m p a n ie s . (See Surety Companies.)
H o lid ay s. T he first day of January, the 12th day of February,
Lincoln D ay; th e 22nd day of F ebruary; th e 30th day of May; the
4 th day of July, the first M onday of September, L abor .Day; the
12th day of October, Colum bus D ay; and th e 25th d ay oi December;
and if any of said days tall on Sunday, th en th e M onday next; and
any days appointed or recom m ended by th e governor of the State or
by th e P resident of the U nited States for thanksgiving, tasting, or
any religious observance. Saturdays after twelve o’clock for all
banking purposes
H u s b a n d a n d W ife. In all m arriages contracted after April 19,
1877, neither husband nor wife acquires by force of th e marriage
any right to or interest to any property held by th e other before
th e m arriage or acquired after th e m arriage, except as to the share
of th e survivor in th e property of th e other as hereinafter stated.
Wife m arried subsequent to April 19, 1877, m ay hold and convey
real estate separate from her husband. Separate earnings of the
wife are h er sole property. On th e d eath of th e husband or wife
the survivor shall be entitled to th e use for life of one-third in value
of all th e property, real or personal, owned by th e other a t the time
of his or her decease, after th e paym ent of all debts and charges
allowed against th e estate. The right to such th ird can not be defeated
by will. W here there is no will th e survivor shall take such third
absolutely, and if th ere are no children, shall tak e all of the estate
. of th e decedent absolutely to th e extent of $2,000, and one-third <
absolutely of the rem ainder of said estate.
I n ju n c tio n s . Any judge of any court of equitable jiirisdiction
may, on motion, g rant and enforce writs of injunction, which shall
be of force until th e sitting of such court and its further order therein,
unless sooner dissolved. Superior court judge m ay dissolve tem­
porary injunction granted by other court. All facts stated In appli­
cation for injunction m ust be verified by oath. Plaintiff must give
bond with satisfactory surety, to answer all dam ages in case of failure
to prosecute to effect, before tem porary injunction can be issued,
unless the court shall be of opinion th a t tem porary injunction ought
to issue w ithout bond. Injunctions m ay be granted forthwith, u
the circum stances of th e case dem and it; or th e court or judge may
cause im m ediate notice of the application to be given to the adverse
party, th a t he m ay show cause why such injunction should not db
granted; and it shall be sufficient, on such application for a tempo­
rary injunction, to present to the court or judge th e original com­
plaint containing the dem and for an injunction, duly verified, wnnout fu rth er com plaint, application or m otion in writing. Whenever
a tem porary injunction is granted in any cause before the return
day thereof, it m ay be dissolved or modified by th e court o r judge
who issued it, by any judge of the court to which th e action is return­
able, or by any judge of th e superior court; provided a written
motion for such dissolution shall be prepared before the return day.
Any person who m ay be directly or indirectly interested in, or affect
by th e granting of any tem porary or perm anent injunction, may
appear and be heard with regard to granting or dissolving the sam .
When in any action a tem porary injunction has been granted, »
upon final hearing judgm ent shall be rendered adverse to the contin­
uance of such injunction, either p arty m ay apply to th e court rendering
such judgm ent, representing th a t he is desirous of taking tne c
to the suprem e court of errors, and praying th a t said tempor *
injunction m ay be continued until th e final decision therein, an
unless said court shall be of opinion th a t great _irreparable w '
will be done by the fu rth er continuance of said injunction, or
said application is m ade for delay and n o t , m good faith, it
be th e d u ty of the court to continue said injunction until a
decision be rendered in the suprem e court of errors. When in
action judgm ent shall be rendered for a perm anent mj unction o
ing either p a rty to perform any act, upon similar application
th a t above mentioned, a stay of operation of such injunction, pe __
final decision of suprem e court of errors, m ay be granted lor si
reasons. The court in which such case is pending may. no
■
if in its opinion the cause of justice shall so require, dissolve
tem porary injunction or rem ove th e stay of said perm anent l J
tion while said cause is so pending in th e suprem e court or erro •
In so lv en cy . Suspended, owing to United S tates Bankruptcy
•
I n te r e s t. Legal rate, in absence of express agreement, 6 per cent^
no more th an 6 per cent can be recovered in either.case aite
^
becomes payable. Express agreem ents in which 12 per
tQ
charged are valid and any person m akm g a greater chargei is u“ h rge
fine and im prisonm ent. T here is no lim it to th e toterest
t
which can be m ade by any N ational Bank or any Bank o
Com pany, incorporated under th e laws of this State nor is tto erty
lim it to th e interest charge on a bona fide m ortgage of real P „awnexceeding th e sum of five hundred dollars. Special
rp 0 ay
brokers. Loan Companies licensed by Bank Commission
^
charge not to exceed 42 per cent per annum on unpaid balances
loans up to $300.
, fiX6CU.
J u d g m e n ts carry 6 per cent interest, b u t are n ot 1
j udgtion m ay be had a t any tim e during the life of bot*LpS^innearance
m ent by default m ay be obtained if th e defendant m akes no app

g

BA N K IN G AND COM M ERCIAL LAWS—CO N N ECTIC U T
on or before th e second d ay of th e session. Certificate of judgm ent
may be recorded by judgm ent creditor or his assignee in town clerk's
office, and such judgm ent from th e tim e of filing such certificate shall
constitute a lien upon th e real estate described in such certificate, and
if such lien be placed upon real estate attached in the suit upon which
such judgm ent was predicated and within four m onths after such
judgment was rendered, it shall hold from th e date of such attachm ent.
Such lien m ay be foreclosed or redeem ed in th e sam e m anner as
mortgages upon th e sam e estate, and m ay also be foreclosed by decree
of sale.
Ju risd ic tio n . (See Courts.)
Liens. (Mechanics’ Liens.) M echanics’ liens for labor or m ate­
rials furnished in th e construction or repair of any building m ay be
filed by original contractor w ithin sixty days after completion of work;
but sub-contractor m ust serve owner of building w ith notice of his
intention to claim a lien w ithin sixty days after he shall have ceased
furnishing m aterials o r render services and also file his lien within
said tim e. P ay m en t m ade by th e owner of th e building to the
original contractor in accordance w ith contract shall be considered as
made in good faith unless the sub-contractor has duly notified said
owner to w ithhold paym ent. M echanics’ liens are foreclosed same
as real estate mortgages. Unless foreclosure is instituted, liens
expire two years after filing. (For judgm ent Liens, see Judgm ents.)
L im ita tio n s to S u its . Open accounts and contracts n ot Under
seal, six years; contracts under seal and prom issory notes n o t negoti­
able, seventeen years. Usual exceptions in favor of m arried women
.minors, lunatics, and those im prisoned. The tim e during which
the party against whom th ere m ay be such cause of action shall be
without th e S tate shall be excluded from th e com putation. T itle
to real estate by adverse possession m ay be gained in fifteen years
There is no lim itation against judgm ents b u t th e common law pre­
sumption of paym ent after tw enty years exists.
L im ited P a r tn e r s h ip s . Such partnerships (except banking and
insurance) shall consist of one or m ore partners, jointly and severally
responsible, as in ordinary cases, to be called general partners; and
one or more partners, furnishing capital to th e partnership stock,
whose liability shall n o t extend beyond th e capital so furnished by
them, to be called special partners. Such partnerships shall be
conducted under a com pany nam e, in which th e nam e of one or more
of the general partn ers shall appear; and if any special p a rtn e r’s
name shall be used in said com pany nam e, he shall be held liable
as a general partn er. No such partnership shall be deem ed to be
formed until th e persons form ing it shall m ake, and severally sign
and acknowledge before any officer authorized to take th e acknowl­
edgment of deeds, a certificate stating th e com pany nam e and nam es
and residences of all th e partners designating which are general
and which are special partners, and which of th e general partn ers
are authorized to tran sact th e partnership business and sign the
firm name, and also th e am ount of capital furnished by each special
partner and th e tim e a t which the partnership is to commence and
terminate; nor u n til such certificate, and also a certificate of th e
amount actually paid in b y each special partner, signed and sworn
to by such of th e general p artners as are authorized to transact the
partnership business, shall be filed and recorded in the office of the
town clerk of th e tow n where th e principal business of th e p a rt­
nership is to be carried on; and a copy of such certificate shall be
prima facie evidence of th e m atters therein contained; and th e p art­
nership shall be responsible only for th e acts of th e general partners
designated as specially authorized as aforesaid; and copies of said
certificates shall, in like m anner, be filed in every town where such
partnership m ay have a place of business. Term s of such partnership
must be published for six weeks in newspaper published in county
where business is to be carried on. A ny such partnership m ay be
renewed by filing a t any tim e before its expiration, w ith th e town
clerk, a sworn certificate of th e general partners, setting forth the
time for which said renewal is m ade, w hether th e special capital
has been reduced or im paired since th e la st certificate filed by said
partnership, and if so, to w hat am ount, and by publishing n ot less
than once a week for two weeks in a newspaper published in county,
the time a t which th e said renewed partnership is to commence and
terminate, signed b y th e p artners thereto, and specifying which are
general and which are special partners. I f th e requirem ents con­
cerning original certificate are n ot complied -with, or false certificate
be made, all special p artn ers shall be liable as general partners. All
advancements to the capital stock by th e special partners shall
be in cash and no p a rt of th e capital furnished by them shall be w ith­
drawn, either in th e shape of dividends, profits or otherwise, a t any
urne while such partnership continues; except th a t any special p art­
ner may lawfully be paid from the assets of such partnership, each
year during th e continuance thereof, a sum not exceeding 10 per
c®utum upon th e cash contributed by him to th e capital stock; provided th at such paym ent shall only be m ade out of th e net profits *
actually earned by such partnerships during th e year for which su d i
payment is m ade. No special partner shall under any circum­
stances be considered a creditor, or allowed to claim as a creditor,
rio special p artn er shall be joined as a p a rty in any action by or
against such partnership unless liable as a general partner.
Married W o m e n . (See H usband and Wife.)
. M ortgages of real estate are executed, acknowledged, and recorded
m the same m anner as deeds, and are foreclosed by strict foreclosure
or by a decree of sale. C h attel m ortgages to be good against third
Parties, where th e m ortgagor retains possession, m ust be executed,
acknowledged, and recorded as m ortgages of land, and can only be
made of the following described personal property—w ith or w ithout
me real estate in which th e sam e is situated or used—nam ely: m a­
chinery, engines, or im plem ents situated and used in any m anu­
facturing or m echanical establishm ent; m achinery, engines, implew nts’ ,cases> types, cuts, or plates situated and used in any printmg, publishing, or engraving establishm ent; household furniture in a
mg house used by th e owner therein in housekeeping; hay and
fODacco m th e leaf in any building. Piano, organ, melodeon, and
any musical instrum ent used by ah orchestra or band. Brick burned
¡"^ b u rn e d , in an y kiln or brickyard. H otel keepers m ay m ortans
j furniture, fixtures, and other personal chattels contained
tho us?<?
tlle hotels occupied by them or employed in connection
herewith. C h attel m ortgages are foreclosed by sale under order
timTa
all chattel m ortgages th ere m ust be a particular descrip28* or each article of personal property. Judgm ent for deficiency
“iter sale, perm itted.
„N otaries P u b lic hold office for five years from first day of Febyear hi which commissioned, unless commission is sooner
governor. M ay exercise their function a t any place in
rjate. M ay tak e acknowledgments, adm inister oath, take deposition,
wpcBim witnesses to give deposition. T he authority and official
notary m ay be certified to by th e clerk of th e superior
wWoiiT16 county in which he resides, except in N ew London County,
Pleas
certffication is m ade by th e clerk of th e court of common
tow^ifforc11**

°* E x ch an g e.

Negotiable Instrum ents Act

of A tto rn e y . W here a deed is executed b y a power of
rea?k?Vt ls recorded w ith the deed. Powers of a ttorney to convey
forVk ate “ u st be executed and acknowledged in th e m anner required
me execution and acknowledgm ent of th e conveyance itself.
Private B a n k s. (See end of S tate Banks and T rust Companies.)
m«u»b atS L aw - (See A dm inistration of E states, Appeals, Assigntv??*?. Insolvency, Collateral Inheritance Tax, Courts, D escent
u •Ulstribution of Pro p erty , H usband and Wife, and Wills.)
Protest. (See N otes and Bills of Exchange.)


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1725

R e co rd s. W arranty, m ortgage, quitclaim deeds m ust be recorded
in office of town clerk in tow n where land lies, also assignm ents of
mortgage, conditional bills of sale, chattel mortgages, assignments
of future earnings. Certificate of trade-m ark to be filed for record
in office of secretary of S tate, Certificate of unsatisfied judgm ent
to be filed for record in tow n clerk’s office. (See Conveyances, Insur­
ance Companies, Lim ited Partnerships, Judgm ents, etc.)
R e d e m p tio n . (See M ortgages.)
R eplevy. Replevin lies for goods wrongfully detained, in which
the plaintiff has a general or special property w ith rig h t to im m ediate
possession. A w rit of replevin can not issue except upon an affidavit
in which th e affiant sta te s th e tru e value of the goods to be replevied,
and th a t he believes th a t th e plaintiff is entitled to the im m ediate
possession of the same, nor until th e plaintiff furnishes a bond w ith
sufficient surety in a sum double th e value of the property. This
bond' or recognizance m ust be signed by th e obligors in presence
of a t least one witness other th an th e authority taking th e recog­
nizance.
S ale of R e ta il B u sin e ss. Any person (including a person having
an interest in a b arber shop, dental parlor, restaurant, shoe shining,
or h a t cleaning business), who m akes it his business to buy commod­
ities and sell th e same in small quantities for th e purpose of m aking
a profit and desiring to sell th e whole or a large p a rt of his stock in
trade, m ust file a notice of such intention in th e tow n clerk’s office
not less th an fourteen, nor m ore th an th irty days prior to such sale.
S ales. Uniform Sales A ct passed in 1907.
S ervice. Service of a w rit of summons in case of a resident is
m ade by reading it and th e com plaint accom panying it in th e defend­
a n t’s hearing, or by leaving an atteste d copy in th e defendant’s hands
or a t his usual place of abode; in case of a non-resident, th e several
courts, o ther th an courts of probate, and the judges, clerks, and
assistant clerks thereof, or any county commissioner, in term tim e
or in vacation, m ay, except where it is otherwise specially provided
by law, m ake such orders as m ay be deem ed reasonable, in regard
to th e notice which shall be given of the institution or pendency
of all com plaints, w rits of error and appeal from probate, which
m ay be brought to or pending in any court, when th e adverse party ,
or any person so interested therein, th a t they ought to he m ade
parties thereto, reside o ut of th e State, or when th e nam es or resi­
dences of any such persons in interest are unknown to th e p arty
instituting th e proceeding; and such notice having been given and
proved shall be deem ed sufficient service and notice.
S ta te B a n k s a n d T r u s t C o m p a n ie s . A reserve fund of 12 per
cent of its dem and deposits and 5 per cent of its tim e deposits m u st
be held and m aintained in th e banking office, of which 4-12 m ust he
gold and silver coin, dem and obligations of th e U nited States or
national bank currency, or federal reserve notes and federal reserve
b ank notes. _T he rem ainder of said reserve fund m ay consist of
balances subject to dem and d raft w ith reserve agents, which are
m em bers of th e clearing house associations of New York, Boston,
Philadelphia,_ Chicago, or Albany, or Buffalo, or a federal reserve
bank, or national banks, sta te banks, or tru s t companies, located in
Bridgeport, New H aven, or H artford, or W aterbury, and of bonds
which are legal investm ents for savings banks which bonds shall a t
no tim e exceed a t par value one sixth of th e to tal reserve fund. N o
new loans or discounts m ay be m ade when the reserve is1below 12
per cent. Bank commissioners m ay apply for appointm ent of a
receiver when th e reserve falls below 12 per cent after th irty days’
notice. “ D em and deposits” shall m ean all deposits payable w ithin
th irty days and “ tim e deposits” shall m ean all deposits payable after
th irty days.
N o one person, corporation or firjn m ay borrow more th a n 10
per cent of th e am ount of the capital stock paid in and surplus undi­
vided profits combined, of any sta te bank or tru s t com pany. T his
does n ot apply to collateral loans. P enalty of $3,000 for violation
of this law. P aper of executive officers or clerks m ay n ot be dis­
counted. Loans to parties outside the State can only be m ade when
th e loans and discounts in th e aggregate am ount to one-half of th e
capital stock.
Books of a b ank m ay be examined by stockholders under certain
conditions.
Three-fourths of th e directors m ust be residents of th e State. ' No
director m ay be obligated to a bank or tru st com pany in an am ount
exceeding 5 per cent of the capital actually paid in and surplus undi­
vided profits comhined. This does n ot apply to loans secured by
collateral.
Cashier’s bond of $10,000.
A t least five reports, verified by oath, m ust be m ade, each year
to th e bank commissioners, exhibiting in detail th e resources and
liabilities of th e bank or tru st com pany ten days after receipt of
request therefor from th e bank commissioners, which shall be published
in a newspaper in th e county where th e bank or th e tru s t com pany
is located, P enalty of $10 for each day of delay in transm itting
report.
Words “ bank,” “ tru s t,” or "sav in g s” m ay only be used by banks,
tru st companies and building and loan associations incorporated by
the U nited S tates or by th e general assembly, b u t th is shall not apply
to firms or individuals doing business as private bankers or brokers
under th eir own names, who deposit w ith the S tate tre a su re r1a bond
of $10,000, or acceptable securities Of th a t am ount for th e protection
of customers from styling them selves bankers in th e conduct of their
business. Banks and tru st companies m aintaining savings depart­
m ents m ust invest deposits according to th e laws of th e S tate con­
cerning investm ents of savings banks, and m ust m ake sworn sta te­
m ents to th e bank commissioners on October 1st in each year and
oftener if required by th e commissioners, of th e am ount of such
deposits and the securities in which th ey are invested. A S tate Bank
or T rust Com pany m ay be incorporated under General Laws as pro­
vided in C hapter 194, Public Acts of 1913,
S u its; (See Actions.)
,
S u re ty C o m p a n ie s . Any corporation w ith a paid-up capital of
not less th an $250,000, incorporated and organized for th e purpose of
transacting business as surety on obligations for persons or corpora­
tions, on complying w ith certain requirem ents of law m ay be accepted
as surety upon th e bond of any person or corporation required by
the laws of this S tate to execute a bond. E very foreign corporation
before transacting any business in this S tate am ust deposit w ith the
insurance commissioner a copy of its charter or articles of association,
and sworn statem ent of th e condition of its business. The insurance
commissioner m ay thereafter issue to such com pany a license to do
business in this S tate. Such com pany m ust appoint th e insurance
commissioner its agent on whom process m ay be served. Such com­
pany m ust file annually on or before M arch 1st, w ith the' insurance
commissioner a statem en t of th e capital of such com pany and its
investm ents and risks. An annual license is granted if annual sta te­
m ent be satisfactory. Local agents m ust procure certificates of
au th o rity to a c t as agent from th e insurance commissioner. T he
insurance commissioner m ay also a t any tim e examine th é affairs
of any surety com pany doing business in the State. A reserve fund
m ust be m aintained equal to 50 per cent of the gross am ount of
premiums received on business in force. No such com pany can
incur on behalf of any one person or corporation a liability for an
am ount larger th an one-tenth of its paid-up capital stock and sur­
plus w ithout giving collateral security.
T a x e s.' L and m ay be sold for delinquent taxes after due adver­
tising, only so m uch being sold as is necessary to p ay taxes and costs.
Owner has one year in which to redeem, by paying th e purchase
money, w ith 12 per cent interest. Bonds, notes, or other choses
in action, except bonds and notes secured by m ortgage on real estate
situ ated in this S tate, m ay be exem pted from all local taxation by
paying to th e S tate a tax of 2 per cent on th e face am ount thereof
for five years, or a t the option of th e holder thereof for a greater or

BAN K IN G AND COM M ERCIAL LAWS—DELAW ARE

1726

less num ber of years a t a proportionate rate. Inheritance taxes are
levied on all property within Connecticut possessed by any resident
of C onnecticut a t the tim e of his decease, and all tangible property
w ithin Connecticut possessed by a non-resident a t the tim e of his
death which passed by gift, to take effect a t 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.
B ates of th e 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 and lineal descendant of
an y 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 deced an t to any stepchild, brother or sister of the full or half blood and
to an y 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
th an those above m entioned up to and including $25,000 with graded
increases. Only one exem ption is allowed for each class.
T ra n s fe r of C o rp o ra tio n S to c k s. (See Corporations.)
T r u s t C o m p an ies- (See S tate Banks and T rust Companies.)
W a re h o u se R e c e ip ts. ¡Uniform W arehouse Receipts Act passed
in 1907.
W ills. All persons of ¿he age of eighteen years, and of sound
mind, m ay dispose of their estate (real or personal) by will. No
devise, except for public and charitable uses, or for the care of ceme­
teries or graves, shall be m ade to any persons but such as are a t the
tim e of th e d eath of th e testa to r in being, or to their im m ediate issue
or descendants. Wills m ust be in writing, subscribed by th e testator,
and atteste d by three witnesses, each of them subscribing m his
presence, b ut they will be effectual here if executed according to
th e laws of the S tate or country where executed. If, after the making
of a will, the testa to r shall m arry, or if a child is born to the testator,
and no provision is m ade in th e will for such contingency, such m ar­
riage or birth shall operate as a revocation of such will. A will or
codicil is otherwise revoked by burning, canceling, tearing, or oblit­
erating it by the testator, or some person in his presence by his direc­
tion, or by a later will or codicil. A devise of bequest to a subscrib­
ing witness or to the husband or wife of a subscribing witness, is void
unless th e 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 th e deceased resided.
W illi of non-residents owning property in th is S tate m ay be proved
by filing exemplified copies thereof in district where property is located.
Such course should always be tak en in order to pass good title to real
estate.
W o rk m e n ’s C o m p e n s a tio n A ct. Passed in 1913.

SYNOPSIS OF

THE LAW S OF DELAWARE
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by S y l v e s t e r D. T o w n s e n d , J r ., A ttorney a t Law,
m ington. (See C ard in A ttorneys’ List.)

Wil­

A ck n o w le d g m e n t. (See Conveyances.)
A ctio n s. Shit m ay be commenced by capias, summons, and
(where defendant is non-resident) by attachm ent of property. Sum-,
mons in justice’s court m ay be issued returnable in five days from
d ate of service, or m ay be m ade returnable forthw ith, upon plain­
tiff filing an affidavit th a t th ere is danger of his losing th e benefit
of his process by delay. In superior court th e summons m ust be
served personally on debtor before court sits, or by leaving a copy
of th e summons a t his usual place of abode, in presence of some
w hite ad u lt person, six days before court sits. Service by publi­
cation allowed in th e court of chancery only.
A ffid av its m ay be adm inistered in the S tate by the chancellor,
an y judge, justice of th e peace, or notary public, and out of the
S tate by any official duly authorized to tak e acknowledgments of
deeds, etc.; b u t before a notary public is preferable. T he affiant
m ust sign th e affidavit.
A s sig n m e n ts a n d In so lv en cy . T here is a dom estic insolvent
law providing for a full surrender and equal distribution of all property,
b u t it is very seldom used, and there is no provision in th e act for
th e discharge of th e debtor upon his m aking an assignm ent. T he
assignee m ust file a schedule of property assigned w ithin th irty days,
and two appraisers are th en appointed by th e chancellor. Assign­
m ents m ust be for th e benefit of all creditors alike.
A tta c h m e n ts . Domestic attachm ent m ay be issued against an
in habitant of this State, after a return to a summons or capias issued
ten days before th e return thereof, of non est inventus, and proof
of cause of action; or upon th e tiling of an affidavit “ th a t th e defend­
a n t is justly indebted to th e plaintiff in a sum exceeding $50, and
has absconded from the place of his usual abode, or gone out of the
S tate w ith in ten t to defraud his creditors, or to elude process, as
Is believed.” The w rit directs the attachm ent of property and sum ­
mons of garnishees. A ttachm ent m ay be dissolved on entering
security to satisfy any judgm ent to th e extent of th e property attached
th a t m ay be recovered against the defendant. On return of attach ­
m ent th e court appoints three persons as auditors of the claims of
creditors; th e creditor attaching is allowed a double share for his
diligence, n ot to exceed full am ount of debt. Any creditor n ot duly
presenting his claim Receives no share in th e distribution. Plaintiff
is not required to give security. Wages are exem pt from attach ­
m ent in New Castle C ounty except for board or lodging. Foreign
attach m ent m ay be issued against any person not an inhabitant
of th e S tate after a return of non est as in domestic attachm ent,
or upon affidavit being m ade “ th a t the defendant resides out of the
S tate, and is justly indebted to th e plaintiff in a sum exceeding $50.”
Foreign attachm ent m ay also issue against a foreign corporation, b u t
in th is case the am ount of the real debt m ust be particularly speci­
fied in th e affidavit, and m ust exceed $50. Unlike domestic attach ­
m ents th e plaintiff in foreign attachm ents has the benefit of his own
discovery and does n ot share w ith other creditors. I t is similar to
domestic attachm ent in all respects except as to appointm ent of
auditors and distribution am ong creditors. T he court or any judge
upon petition m ay investigate any allegation in affidavit, except as
to th e am ount of the debt, and dissolve the attachm ent if sufficient
ground be not shown. Foreign attachm ent is otherwise dissolved by
entering special bail. By recent am endm ent in cases of foreign
attach m ent it is no longer necessary to enter security to discharge
th e attachm ent, before an appearance can be entered. An appearance
m ay be entered w ithout security to discharge the attachm ent, and
th e goods attached rem ain as security pro tan to.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

B a n k s. T here is no general banking act and b u t one State bank
which was chartered by th e legislature in 1807. Banking companies
can not be formed a t present, except by special act of th e Legislature.
The holders of stock are taxed a t the rate of one-fourth of one per
centum on th e cash value of each share of Capital stock. There
have been recently several tru st companies formed in the State,
either by special act before the 1897 constitution, and by general
corporation act since, which have been granted banking powers by
special statute. Banks and tru st companies are now subject to
exam ination and inspection by insurance commissioner. By recent
am endm ent, N ational Bank m ay act as T rustee, Executor, Adminis­
trator, or Registrar of stocks and bonds. Bank by recent amend­
m ent, prevented from loaning more th an ten per cent of capital stock
and surplus to any one person.
B ills a n d N o tes. Acceptance should be in writing on the bill.
All checks, notes, drafts, or bills, foreign or inland, payable without
tim e or a t sight, are due on presentm ent w ithout grace.
C h a tte l M o rtg ag es m ust be accom panied w ith an affidavit that
the m ortgage is m ade for the bona fide purpose of seem ing a debt,
and not to defraud creditors, and if recorded within ten days from
the acknowledgment thereof, is a valid lien for five years on personal
property, the possession of which m ay rem ain in th e mortgagor.
C la im s A g a in s t E s ta te s of D eceased P e rs o n s are paid in the
following order: 1. Funeral expenses. 2. Bills for medicine, med­
ical attendance, nursing, and necessaries for last sickness of the
deceased. 3. No more th an one y ear’s wages of servants in house
and laborer on a farm . 4. R ent for not more th an one year, either
growing due or in arrears. 5. Judgm ents and decrees in equity
against deceased. 6. Recognizances, m ortgages, and other obliga­
tions of record. 7. Obligations and ' ’ontracts under seal. 8. Con­
tracts under hand for the paym ent of money, delivery of goods,
wares or merchandise. 9. O ther dem ands. Administration is
granted: 1. To the person entitled to the residue. 2. To one or
more of the creditors. 3. To any suitable person, resident or non­
resident. Bond m ust be given for an am ount double th e value of
the estate. N otice m ust be given of claims against the deceased
within six m onths from granting of letters (except claims of record),
or executor or adm inistrator is protected in paying debts of a lower
grade. One year is allowed for settling the estate, and until the
expiration of th a t tim e, he need not m ake distribution, nor is he
chargeable w ith interest on th e assets in hand. H e m ay be removed
upon sufficient cause. L etters granted in other states and produced
under th e seal of th e officer or court granting th e same, is competent
authority for him to act in this State.
C o n tr a c ts are joint and several, unless otherwise expressed.
C onveyances of R eal E s ta te m ust be under seal (a scroll is
sufficient), and should be executed before one witness a t least. Deed
m ay be acknowledged out of the State before any consul-general,
consul, or commercial agent of th e U nited States, duly appointed
in any foreign country a t the places of their respective official residence;
before th e judge of any district or circuit court of th e United States,
or the chancellor or any judge of a court of record of any state, terri­
tory, or country, or the m ayor or chief officer of any city or borough,
and certified under th e hand of such chancellor, judge, mayor, or
officer, and the seal of his office, court, city, or borough, by certificate
endorsed upon or annexed to th e deed; or such acknowledgment
or proof m ay be taken in any such court and certified under the hand
of th e clerk or other officer of said court, and th e seal of said court
in like m anner. In case of such certificate by a judge, the seal of
his court m ay be affixed to his certificate, or to a certificate of at­
testation of th e clerk or keeper of th e seal. Such acknowledgment
m ay also be taken by any commissioner of deeds for this State, or
by a notary public of any sta te or territory. Wife m ust join in deed
to bar dower, and husband to bar curtesy. A deed by a corpora­
tion m ay be executed and acknowledged by th e president or other
presiding officer duly authorized by resolution of th e directors, trustees,
or other m anagers, or by th e legally constituted attorney of such cor­
poration under its corporate seal. Deeds m ust be recorded within
three m onths after sealing and delivery, to avail against creditors,
mortgagee, or bona fide purchasers, w ithout notice.
C o rp o ra tio n s. General Corporation Act for all purposes other
than banking. Each stockholder is individually liable for the amount
of capital stock not paid in in proportion to th e am ount subscribed
by him. Corporations of other states m ay be sued in this State,
and the property of th e same found here m ay be seized by attach­
m ent. All foreign corporations m ust file w ith th e secretary of state,
statem ent of assets and liabilities, and the nam e of its authorized
agent upon whom process m ay be served; m ust pay a State tax or
$10, and fees of secretary of sta te (this S tate tax Is paid but once)
m ust file w ith th e prothonotary o f each county th e nam e of authorized
agent upon whom process m ay be served.
C o sts. Non-resident plaintiffs m ay be required to giYe security
for costs. .
C o u rts . T erm s and Jurisdiction. T he different courts Of the
State are as follows: Supreme court; regular term a t Dover third
Tuesday in June and January. C ourt of chancery and orphans
court; regular term s, New Castle C ounty, a t Wilmington, on we
fourth M onday in M arch and second M onday in September; Kent
C ounty, a t Dover, th ird M onday in M arch and th ird Monday in
Septem ber; Sussex County, a t Georgetown, second M onday in March
and first M onday in Septem ber. Superior court, and court of general
sessions are held in New Castle C ounty a t Wilmington the first Mon­
day in January, M arch, M ay, and N ovem ber and th ird Monday in
Septem ber, in K ent C ounty a t Dover, th e first M onday in July ana
th e th ird M onday in February, April, and October, and In Sussex
C ounty th e first M onday in F ebruary, April, and October and last
M onday in June in Georgetown. Oyer and term iner meets on cai
of judges. Jurisdiction—T he superior court has jurisdiction m an
civil cases, b u t if suit be brought for less than $50, costs will not
be recovered. Justice’s jurisdiction, $200. New Court known as
C ourt of Common Pleas was recently created for New Castle County
Presided over by one of the Judges of Superior Court. Open con­
tinuously except July and August. Jurisdiction of all cases ex con­
tractu up to $1,000.
D e p o sitio n s. In any suit pending, the prothonotary, 0° j* ppi^
cation, enters a rule commission on th e p a rt of th e applicant to any
commissioner of th e S tate or o ther person. The commission issue
on ten days’ notice of interrogatories filed. Exceptions to interroga­
tories m ust be filed before the commission issues, and are ne<uu
before a judge a t chambers. Exceptions to th e execution m usiu
filed w ithin two days after publication. I f the commissioner W '
a clerk, add " T h e clerk by me em ployed in taking, writing, era
scribing, and engrossing the said depositions, having first auiy »
the oath assigned to th e said commission according to the reuw
thereof.”
._
E x e c u tio n s are a lien upon personalty from th e tim e the sher
received th e writ, if actual levy be m ade within sixty days tne
after. P riority of lien rem ains in force five years. Execution “w
be issued within five years after date of judgm ent. An execu
from a justice is a lien from tim e w rit is received, if levy
“
within th irty days and priority of w rit rem ains for two years, i ^ x ,
tion can n ot issue after th ree years w ithout revival, uooqs
chattels of a ten an t are liable to one y ear’s ren t m preierenc _
the execution. T here is no redem ption on property sola u
execution or m ortgage. In New Castle C ounty wages for a m
of employes of corporations are preferred to th e execution.
,
of six m onths is granted in courts of record upon judgm ents re^within
for w ant of affidavit of defence, provided security be giy®?
tw enty days after judgm ent. In justice’s court® defendant may
six m onths’ stay, upon pleading his freehold; nine m onths .stay v
giving security.

BA N K IN G AND COM M ERCIAL LAWS—D IS T R IC T OF COLUMBIA
E x em p tio n s. No hom estead law. Fam ily pictures, bibie, and
library; lot in burial ground and pew in church; all wearing apparel;
sewing m achines in private families; tools of trad e n ot to exceed $50
in Kent, or $75 in New Castle C ounty; and to the head of a fam ily
in New Castle County $200 of personal property an'd in K ent County
$150, consisting of household goods only. No additional exemption
in Sussex. The provisions of the exem ption law extend and apply
to a person dying and leaving a widow, giving and securing to such
widow th e same benefit of exem ption th a t her husband would have
bad if living. Wages are exem pt from execution attachm ent in New
Castle County except for board or lodging. Pianos and organs leased
or sold under contract exem pt from execution process or distress
for rent, provided the lessor or vendor notifies th e landlord in writing
of the claim thereof.
F ra u d s. Sale of goods void as to third parties, unless for valu­
able consideration and th e possession thereof be actually delivered
to the vendee. A promise to pay the debt, default, or m iscarriage
of another to th e ex ten t of $5 is binding if proved by th e oath of the
promisee; for an am ount between $5 and $25 m ust be proved by
one credible witness or some m em orandum in w riting signed by the
person to be charged therew ith; for an am ount exceeding $25 there
must be some m em orandum or promise in writing signed by the
party to be charged therew ith. Sale of Goods in Bulk Law recently
amended imposing penalty upon seller and purchaser where require­
ments as to notice on creditors is not carried out.
G a rn is h m e n t. All persons except public officers, attorneys, etc.,
are subject to summons as garnishees. Wages are not subject to
garnishment in New Castle County except for board or lodging.
H olidays, L egal. Jan u ary 1st, F ebruary 12th, F ebruary 22d,
Good Friday, M ay 30th, Ju ly 4th, first M onday in Septem ber, Octo­
ber 12—Columbus D ay; D ay of the general election as it biennially
occurs. Thanksgiving Day, and Christm as, and Saturday afternoon
in New Castle County. If legal holiday falls on Sunday the next
day is observed. Negotiable paper falling due on legal holiday is
due and payable on th e next preceding secular day; if falling due on
Saturday half-holiday, if not presented for paym ent before noon, is
not due until th è next succeeding secular day.
H om estead. T here is no hom estead i aw in Delawarein te re st. Legal rate is 6 per cent. Any person who takes more
for the use or the loan of m oney shall forfeit and pay to any one suing
for the same a sum equal to the money loaned, one-half for the use
of the S tate, and th e other for the p a rty suing.
J u d g m e n ts of courts of record arev lens upon all real estate of the
debtor in th e county where judgm ent is entered from their date, for
a period of ten years and m ay be revived and kept alive and a lien
by s e i . FA. or agreem ent before expiration of ten years from date of
entry. T his lien m ay be extended into either or both the other
counties. Judgm ents can only be obtained in this S tate upon judg­
ments in o th er states by su it upon a certified copy of th e record of
said judgm ent authenticated under the A ct of Congress passed
May 26, 1790. T ranscripts of judgm ents recovered before justices
of the peace m ay be entered in th e superior court and thus be made
liens on real estate after execution and retu rn by Constable on goods
of defendant. Satisfaction m ust be entered within sixty days after
payment. Judgm ent in C ourt of Common Pleas is n ot a lien on
Real E state unless T ranscript filed as in case of Justice of Peace.
L im ita tio n s . C ontracts n ot under h an a an a book accounts three
years, bills and notes under hand six years. Judgm ents and special­
ties are m erely presum ed to have been paid after the lapse of tw enty
years, but th is presum ption m ay be overcome by proof to th e con­
trary. All judgm ents m ust be renewed within ten years in order
to preserve th eir lien on real estate. The sta tu te does not begin to
run in favor of non-resident debtor until he comes into th e S tate, in
such m anner th a t he m ay be served w ith process, and if a debtor
remove after th e cause of action has accrued, the tim e of his absence
is not com puted. On recognizances of sheriffs’, adm inistrators’, or
executors’ bonds, within six years from date. Bond of guardian
within three years from th e determ ination of guardianship.
M arried W o m en retain th eir real and personal property owned
at marriage or received from any person other th an the husband.
May receive wages for th eir personal labor, and prosecute and defend
suits for preservation and protection of their own property, as if
unmarried, and th e rents, issues, and profits of th eir separate estate
are not controllable by th e husband. Dower: The widow is entitled
to one-third p a rt of aU th e lands and tenem ents whereof her husband
was seized a t any tim e during her m arriage, unless she shall have
relinquished such right, for and during the term of her natural life,
if her husband dies w ithout issue or the children of issue she takes a
moiety instead of a th ird p a rt of th e real estate. A married woman
ofche age of twenty-one years and upward m ay dispose of her propbotb real and personal, by will, w ithout th e w ritten consent
or her husband, b u t subject to his right of courtesy. Two or more
witnesses are necessary for a will. H usband and wife m ay testify
m all civil actions in which either or both are or m ay be parties to
the suit.
M ortgages o f B e al P ro p e rty are executed and acknowledged like
oc.oer deeds. T hey become a lien from the tim e they are lodged
with the recorder. Upon foreclosure of same th ere is no redem ption
oi property. A purchase m oney m ortgage should be recorded within
cnirty days to avail against a subsequent innocent holder.
Proof of C laim s. The full individual nam es of plaintiffs and
aeiendants, together with style of doing business, m ust be stated;
or ir a corporation, the laws of w hat sta te under which incorporated,
one of the plaintiffs, if a partnership, or the treasurer or cashier
or a corporation, m ust m ake affidavit to the am ount claimed, giving
an itemized copy of .th e cause of action attached thereto. I t is
advisable to have th e affidavit m ade before a notary public, though
it may be m ade before others. (See Affidavit.)
P rotest. (See Bills and .Notes.)
Replevm. The w rit issues out of the superior court to obtaii
possession of goods unlawfully taken or unlawfully detained. Ni
amaavit is required, b u t before the officer to whom it is directed
ran execute it th e plaintiffs or some substantial person for him m ud
th er Ini° bond to such officer in a penalty of double th e value ol
j=°°as to be replevined, conditioned to prosecute th e suit w itl
onect, etc. D efendant m ay give counter bond and retain the goods
®um noons m ay be served on th e defendant by stating th e sub
“wnce of it to him personally a t any tim e before th e return of th<
n™1 °r by leaving a copy of it a t his usual place of abode in th<
presence of spme ad u lt person six days before the return thereof
against a corporation m ay be served on th e president or head officer, i;
nf iSln^ in k*1® S tate, and if not, on any officer, director, or manage]
in „if corPoration or duly authorized agent nam ed for said services
n L ; nC8ry service m ay be had by publication under order of th<
HWRcatior. From a justice service m ust be personal if forthwith,
wnerwise four days m ust intervene before hearing.
o.^sxes laid and imposed b y the levy court of a county or by t h
tavoKi
lts own purposes, are a lien upon all th e real estate of th
TU? on whom they are imposed, for tw o years, from th e firs
naL?LJuly of, tb e ycar in which tax is imposed. S tate income tai
sm- h*>i » 011 or before M arch 15th of each year for preceding year, an<
a « ! ™ . “ “ preference to all other liens against him . Genera
■sessments are m ade every four years.
4 ny Person of th e age of tw enty-one years or upward
Eva™“o.m m d, m ay m ake a will as well of real as personal estate
will m ust be m writing and signed by th e testato r, or by som
iuftEjP subscribing th e testa to rs’ nam e in his presence and by hi
direction, and attested and subscribed in his presence h
°r more credible witnesses, or it shall be void, A will shall bi


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1727

proved before th e register of the county in which che testato r resided
a t the tim e of his death. A nuncupative will of personal estate n o t
am ounting to over $200 and pronounced by the testa to r in his last
illness in th e presence of two or more witnesses is valid if reduced
to writing and atteste d by said witnesses within three days after.
Children bom a fter the date of the will of the parent are entitled to
th e sam e share of the p aren t’s estate as if such parent had died
intestate.

SYNOPSIS OF

THE LAWS OF
THE DISTRICT OF COLUMBIA
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised b y A b b o t t , P u b l e r & V a n D y k e , A ttorneys a t Law,
1007-1011 Woodward Bldg., W ashington.
A c k n o w le d g m e n ts. The deed of a corporation shall be executed
by having the seal of the corporation attached and being signed with
the nam e of th e corporation, by its president or other officer, and shall
be acknowledged as the deed of the corporation by an atto rn ey
appointed for th a t purpose, by a power of attorney embodied in the
deed or by one separate therefrom , under th e corporate seal, to be
annexed to and recorded w ith th e deed.
A c k n o w le d g m e n t o f D eeds. W hen any deed or contract under
seal relating to land is to be acknowledged out of the D istrict of
Columbia, but within the United States, the acknowledgment m ay
be m ade before any judge of a court of record and of law, or an y
chancellor of a State, any judge or justice of th e supreme, circuit, or
territorial courts of the United States, or any justice of th e peace or
notary public; Provided th a t the certificate of acknowledgment
aforesaid, m ade by any officer of a S tate or Territory, n ot having a
seal, shall be accompanied by a certificate of th e register, clerk, or
o ther public officer th a t th e officer taking said acknowledgment was
in fact th e officer he professed to be. Deeds m ade in a foreign coun­
tr y m ay be acknowledged before any judge or notary public, or before
anysecretarjr of legation or consular officer or acting consular officer
of the U nited States as such consular officer is described in section 1674
of the revised sta tu tes of th e U nited States, and when th e acknowl­
edgm ent is m ade before any other officer other th an a secretary of
legation or consular officer or acting consular officer of th e U nited
States, th e official character of the person taking the acknowledgment
shall be certified in the m anner prescribed as to deeds o ut of the Dis­
tric t of Columbia b u t within th e U nited States. No deeds of con­
veyance of either real or personal estate by individuals shall be exe­
cuted or acknowledged by attorney.
A ctio n s. T he common law forms of actions are used except as
modified by statutes.
A d m in is tr a tio n . T he probate court, a special term of th e
suprem e court of th e D istrict of Columbia, has exclusive jurisdiction
of th e settlem ent of estates. A w ritten petition stating th e facts
in th e case m ust be filed w ith th e register of wills. T his petition is
acted upon by a justice of th e suprem e court of th e D istrict, who sits
daily. All executors and adm inistrators and guardians are required
to give bond w ith security to be approved by th e court. T he testa to r
m ay waive th e giving of bond, b u t th e court always requires a bond
sufficient to cover th e debts and legacies of th e deceased not to exceed
double the value of th e personal estate. B y act of Congress, certain
tru st companies incorporated thereunder m ay act as executor or ad­
m inistrator w ithout bond, and corporations having power under their
charters m ay act as sureties in all cases where individuals can. Credi­
tors m ay be barred in thirteen m onths provided the required notice
is properly published. P robate court m ay order sale of real estate to
pay debts, in case personal assets are insufficient. Assets of non-resi­
dents in D istrict of Columbia are subject to claims of local creditors
for one year after death.
A ffidavits. Affidavits for use in th e D istrict of Columbia should
be taken before a justice of th e peace, n otary public, judge of any
court of record, or a U nited States commissioner. I f taken before a
justice of th e peace, a certificate of his official authority from a clerk
of a court of record should be attached.
A liens. Aliens m ay hold real and personal property in the D istrict
of Columbia, and m ay acquire real estate by descent. Alien corpora­
tions are prohibited from acquiring real estate. Corporations of which
over 50 per cent of th e stock is or m ay be owned by persons or asso­
ciations n ot citizens of U nited States can n ot acquire or own real
estate in D istrict of Columbia.
A ppeals. Appeals from th e M unicipal C ourt to th e Supreme Court
of the D istrict are now abolished. W rits of error from the Court of
Appeals of th e D istrict m ay issue to th e M unicipal C ourt for the
review of judgm ents on questions of law. Appeals m ay be taken
from th e suprem e court of the D istrict of Columbia to the court of
appeals of th e D istrict of Columbia. C ertain cases are appealable
direct to th e C ourt of Appeals. Appeals m ay be taken from the court
of appeals to th e suprem e court of the U nited States:
1. In cases where jurisdiction of trial court is in issue.
2. Prize cases.
3. C onstitutional questions or treaties involved.
4. W here validity of any authority exercised under U. S., by an
officer is m question and
5. Construction of any law of U. S. is drawn in question.
A rre s t. T here is no im prisonm ent for deb t in th e D istrict of
Columbia. The court has th e power to imprison for non-paym ent of
alim ony in divorce eases, and for contem pt of court.
A tta c h m e n ts m ay issue a t institution of suit or subsequently,
upon affidavit of plaintiff or his agent, supported by th a t of one or
more witnesses, showing the grounds of his claim and right to recover,
and th a t defendant is a non-resident, or evades service of process, or
is about to remove, assign, dispose of, or secrete property with inten t
to hinder, delay, and defraud creditors, or th a t the debt was fraud u ­
lently ^contracted. C reditor m ust give bond, w ith approved surety
or sureties, to be approved by the clerk, in twice the am ount of his
claim for costs and dam ages if attachm ent is wrongfully sued out.
B ills a n d N o tes. The common law of E ngland relative to bills
and notes, except where changed by sta tu te, governs all cases in which
th ey are involved. A law sim ilar to th e N ew York N egotiable In stru ­
m ents Law is now in force in this D istrict. (See Legal Holidays and
Protest.)
C h a tte l M o rtg ag es. No bill of sale or m ortgage or deed of tru st
to secure a debt of any personal chattels whereof th e vendor, m ort­
gagor, or donor shall rem ain in possession, is valid and effectual to
pass the title herein, except as between the parties to such instru­
m ent and as to other persons having actual notice of it, unless the
sam e be executed and acknowledged and within ten days from the

1728

B A N K I N G A N D C O M M E R C I A L L A W S — D I S T R I C T O F C O L U M B IA

d ate of such acknowledgm ent recorded in th e same m anner as deeds
of real estate; and as to th ird persons not having notice of it, such
Instrum ent shall be operative only from th e tim e w ithin said ten
days when it is delivered to th e recorder of deeds to be recorded.
C o lla te ra ls. T he holder of th e note as collateral security for debt
stands upon th e sam e footing as th e purchaser and m ay m aintain suit
thereon for his own benefit. T he collateral pledged m ay toe sold in
accordance w ith th e term s of th e collateral note which usually pro­
vides th a t th e collateral m ay be sold upon non-paym ent of the prin­
cipal of th e note, either a t public or private sale, and in such cases the
purchaser a t any such sale obtains a valid title to th e collateral sold.
C o n tr a c ts . E very contract and obligation entered into by two
or more persons, w hether p artners or m erely joint contractors, w hether
under seal or not, w ritten or verbal, and w hether expressed to be
jo in t an d several or not, is for th e purposes of suit deem ed joint and
several. On th e d eath of one or more of such persons, his or their
executors, adm inistrators, or heirs are bound by said contract in the
sam e m anner and to the sam e extent as if th e same were expressed
to be jo in t and several. In actions ex contractu against alleged joint
debtors it is not necessary for th e plaintiff to prove their joint lia­
bility in order to m aintain his action, b u t he is entitled to recover,
as in actions ex delicto, against such of th e defendants as shall be
shown by th e evidence to be jointly indebted to him , or against one
only, if he alone is shown to be indebted to him , and judgm ent will
be rendered as if th e others had n o t been joined in th e suit. Any of
several jo int debtors, when th eir d eb t is overdue, m ay m ake a separate
composition or compromise w ith their creditors.
C o rp o ra tio n s. Any th ree or more persons m ay form a com pany
for th e purpose of carrying on any enterprise or business which m ay 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 m ay have a perpetual existence.
No such com pany is authorized to transact business until 10 per cent
of th e capital stock shall have been actually paid in. either in money
or p roperty a t its actual value; and th e recorder of deeds, before
filing an y certificate of incorporation, m ust be satisfied th a t th e entire
capital stock has been subscribed for in good faith. All of th e stock­
holders of such com pany are severally and individually liable to th e
creditors of th e com pany in which th ey are stockholders for th e unpaid
am ount due upon th e shares of said stock held by them respectively,
for all debts and contracts m ade by such company, until th e whole
am ount Of capital stock fixed and lim ited by such com pany shall have
heen paid in, and a certificate thereof shall have been m ade and
recorded. E very such com pany m ust annually, except insurance
companies, within tw enty days from th e first of January, m ake a
report, which shall be duly published and which report shall sta te th e
am ount of capital and the proportion actually paid and th e am ount of
existing debts. Foreign corporations doing business in the D istrict
of Colum bia are subject to service of process on th eir agents or on
th e persons conducting th eir business, or by leaving copy thereof a t
th e principal place of business of such com pany, or a t th e residence
of its agent. T he affairs of th e corporation shall be m anaged by n ot
less th an th ree nor m ore th an fifteen trustees, a m ajority of whom
m ust be residents of the D istrict, to be annually elected, except for
th e first year, by the stockholders, a t such tim e and place as m ay be
provided b y th e by-laws. T he fee of the recorder for filing all certi­
ficates of incorporation where capital stock is authorized is forty
(40) cents on each $1,000 of th e am ount of th e capital stock of the
corporation, as set forth in its certificate, provided th a t no fee shell
be less th an $25.
C o u rts in session continuously throughout th e year. Suits on
contracts, accompanied by sufficient affidavit of right to recover,
result in judgm ent in tw enty days, exclusive of Sundays and legal
holidays, after day of service on defendant, unless defendant files an
affidavit setting forth facts which, if trap, would in lawi constitute
a valid defense.
D ays o f G race abolished.
D eeds. T he following form of deed is now all th a t is required in
th e D istrict of Colum bia to convey a fee simple title to real estate:
T h is deed, m ade th is . . . . day o f............ in th e y e a r. . . . . by m e ,. . . .
o f . .. . . . . w itnesseth: T h a t in consideration of (here insert con­
sideration), I, th e sa id
do grant unto (here insert grantee’s
nam e), o f............a l l th a t (here describe th e property)
W itness m y h and and seal.
.................
(Seal.)
A deed m ust be acknowledged and recorded w ith the recorder of deeds
and takes effect from th e tim e of recording. A scroll is considered a
sufficient s e a l..
D e p o sitio n s. Depositions of witnesses to be used in any civil
cause w hether th e case be a t issue or not, m ay be taken under any of
th e following conditions: 1. W here th e witness lives beyond the
D istrict of Columbia. 2. W here the witness is likely to go out of the
U nited States or o u t of th e D istrict and not retu rn in tim e for the
trial. 3. W here th e witness is infirm or aged, or for any reason th e
p arty desiring his testim ony fear he m ay not be able to secure th e same
a t th e tim e of trial, w hether th e said witness resides w ithin th e Dis­
tric t or not. 4. If during th e tria l any witness is unable, by reason
of sickness, or o ther cause, to a tten d th e trial, th e deposition of such
witness m ay, in th e discretion of th e court, be taken and read a t the
trial. T he deposition m ay be tak en before any judge of any court of
th e U nited States; before any commissioner or clerk of any court of
the U nited States, or any exam iner in chancery of any court of the
U nited States; before any. chancellor, justice, or judge or clerk of
an y court of any S tate or T erritory or o ther place under th e sover­
eignty of th e U nited States, or any notary public or justice of th e
eace within any place under th e sovereignty of the U nited States:
rovided, th a t no such person shall be eligible to take such deposition
who is counsel or atto rn ey for any p arty to th e oause, or who is in
anywise interested in th e event of th e cause.
D e sc e n t a n d D is tr ib u tio n . The ordinary rules of descent m ay
be sta te d as follows: 1. I f an in testate leaves a child or children, or
descendant of such child or children, his property descends to such
child or children, or th eir descendants, subject only to th e dower right
of th e widow, if there be one. 2. I f th e estate descended to th e
in testate on the p a rt of th e fath er or m other and there be no child or
th e descendant of any child, then to th e brothers and sisters and their
descendants. 3. I f none, to th e m other or father or the ancestors
of th e in testate and their descendants of the blood of the m other or
father, grandm other of grandfather, as th e case m ay be, subject to th e
widow’s dower. 4. I f none, th en -to th e husband or wife and their
kindred in equal degree, equally. 5. N o distinction between whole
and half blood on p a rt of parent from whom estate descended. 6. If
there be no heir, th e lands shall escheat to th e D istrict of Colum biaPersonal Property": I f a widow and no child or descendants, parent,
brother, or sister or descendants, th e widow shall have th e whole,
of child or descendants, th e widow shall have one-third only; if in
child or descendants, b u t p a re n t-b ro th e r, etc., th e widow shall have
one-half. T he surplus shall go as follows: (1) I f children or descen­
dants, to th em equally p er stirpes; (2) I f no child or descendants and
a fath er, th en to th e father; (3) I f no father, b u t a m other, then to
th e m other; (4) I f none, b u t a brother or sister or descendants, to
them equally per stirpes; (5) I f none, to collateral relations in equal
degree . (6) T here is no distinction oetween th e whole and half Dlood;
(7) N o representation after descendants of brothers and sisters;
(8) | -Beyond the fifth degree, th e personal estate goes to th e Dis­
tric t of C olum bia;‘(9) The husband on death of th e wife is entitled
to all h er personal property in possession w ithout adm inistration, b u t
adm inistration isiusually resorted to for protection of parties dealing
with th e husband.
D ow er. A wife is entitled to dower in all real estate owned by the
husband a t th e tim e of his death, including equitable as well as legal
estates.
E v id en ce. (See Depositions.)

P


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

E x e c u tio n s. Executions m ay be levied upon all goods and chat­
tels of th e debtor n ot exem pt, and upon gold and silver coin, bank
notes or other m oney, bills, checks, promissory notes or bonds, or
certificates of stock in corporations owned by said debtor, and upon
money owned by him in th e hands of th e m arshal or of th e constable
charged with th e execution of such writ, and also upon all legal lease­
hold and freehold estates of th e debtor in land. Executions on judg­
m ents before justices of th e peace m ay be superseded, according to
th e am ount of th e judgm ent, upon good and sufficient security being
entered by a person who m ay a t the tim e be the owner of sufficient
real property located in th e D istrict, above all liabilities and exemp­
tions, to secure th e debt, costs and interests from one to six months,
b u t there can be no sta y of execution for wages of servants or common
laborers, nor upon any judgm ent for less th an $5.
E x e m p tio n s . (Actual residents.) In addition to wearing ap­
parel, etc., household furniture to th e value of $300, implements
of debtor’s trad e or business to th e value of $200, stock for carrying
on business to am ount of $200, one horse, harness and cart, wagon
or dray, and earnings of m arried m en or heads of families, not to
exceed $100 per m onth for tw o m onths. Exem ptions are only allowed
where the p arty claiming such is th e head of a fam ily or householder
residing in th e D istrict.
F o re ig n J u d g m e n ts . Suits m ay be in stitu ted in th e supreme
court of th e D istrict of Columbia on any judgm ent of a court of record
in any other jurisdiction. The declaration in any such case must be
accompanied by a transcript of th e record of such judgm ent verified
according to the act of congress in such cases m ade and provided, and
judgm ent in due course m ay be rendered on such transcript as in
any other case.
G a r n is h m e n t. A fter judgm ent th e w rit of garnishm ent may
issue against specific property or credits in th e hands of th e garnishee
and on th e retu rn of th e writ, if th ere be credits, th e judgm ent or
condem nation follows. The w rit of garnishm ent can n o t be issued
against the U nited States or th e D istrict of Columbia.
H o lid ay s. Legal holidays are Ja n u ary 1st, February 22d,
M ay 30th, July 4th, first M onday in Septem ber (Labor D ay), Decem­
ber 25th, or th e following day when any of these dates fall on Sun­
day, and such day as m ay be appointed by th e President of the
U nited States for fasting and prayer. E very Saturday is a legal half
holiday and notes falling due on th a t day are not payable until
M onday. Process is not issued or served by th e m arshal after 12
o’clock on Saturday.
H u s b a n d a n d W ife. T he wife’s property is exem pt from the hus­
band’s debts. The husband m ay convey direct to his wife. The
wife m ay use all of her property of every description as fully as if she
were unm arried, and m ay dispose of the same by deed, etc., as fully
as if she were unm arried. She also has power to trad e and to sue and
be sued, b u t no m arried woman under the age of twenty-one years can
m ake a valid deed or conveyance. On the death of a m arried woman
the husband is entitled to an estate by courtesy in her fee simple prop­
erty of which she dies intestate. On th e death of the wife intestate her
entire personal estate becomes th e property of her husband. The
husband is not liable for the debts of his wife contracted before mar­
riage. A husband, who willfully neglects to provide for wife or
m inor child under sixteen years, in d estitu te circumstances, may be
adjudged guilty of a m isdemeanor, and m ay be fined, or imprisoned,
by the court having jurisdiction.
I n t e r e s t . T he legal ra te of interest in th e D istrict of Columbia is
6 per cent, and in any suit where th e contract is tain ted w ith 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 th e paym ent of a higher rate of interest than
is lawful in th e D istrict, m ade or to be perform ed in any state or
territo ry of th e U nited S tates where such contract rate of interest
is lawful, th e judgm ent for th e plaintiff shall include such contract
interest to th e date of th e judgm ent and interest thereafter at the
rate of 6 per centum per annum until paid. By express contract this
rate m ay be increased to 8 p er cent.
J u d g m e n ts . E very judgm ent is good and enforceable by an execu­
tion issued thereon for a period of twelve years from th e date when sin
execution m ight first have been issued thereon or from th e date of the
la st revival thereof by scire facias. Judgm ents of th e municipal court
are good for six years, b u t are not liens on real estate u n til recorded in
th e suprem e court of th e D istrict of Columbia.
J u r is d ic tio n . (See Actions, Appeals, and M unicipal Court.)
L im ita tio n s . F ifteen years for recovery of lands, tenements or
hereditam ents; executor’s or adm inistrator’s bond, five years; instru­
m ents under seal, twelve y ears; simple contracts and recovery of per­
sonal property and dam ages for its unlawful detention, three years;
sta tu to ry penalty or forfeiture, libel, slander, assault, battery, may­
hem, wounding, malicious prosecution, false arre st or imprisonment,
one year; all other actions three years. Usual exceptions in favor
of persons under disability. Acknowledgment to revive action on
debt m ust be in writing. P a rt paym ent will take deb t out of statute.
M a rrie d W o m en . (See H usband and Wife.)
M o rtg ag es. M ortgages are alm ost entirely supplanted by deeds
of tru st, requiring no court proceedings to foreclose. Joining the wife
is necessary to bar dower.
M u n ic ip a l C o u r t. By an act of Congress, effective June 1, 1921,
the M unicipal C ourt of th e D istrict of Colum bia was m ade a court
of record. I t now has exclusive jurisdiction in all civil cases in which
th e claimed value of personal property, debt or damages, exclusive
of in terest and costs, does not exceed $1,000. W hen th e value in
controversy shall exceed $20, and in all actions for th e recovery or
th e possession of real property, either p a rty may. dem and a jury trial.
Judgm ents rendered by th e M unicipal C ourt rem ain in force for six
(6) years and no longer, unless it shall toe docketed with th e clerk oi
th e Supreme C ourt oi th e D istrict of Columbia, when it remains in
force for twelve (12) years. N o judgm ent shall be a lien, upon tne
defendants real property until so docketed.
P a r tn e rs h ip s . Lim ited partnerships for th e transaction of any
m ercantile, mechanical, or m anufacturing business within th e District
m ay be form ed by any two or m ore persons, b u t th e num ber of special
partners is lim ited to six. T he special partners are not liable for
the debts of the partnership beyond th e fund contributed by them
to th e capital. A certificate setting forth th e firm name; general
nature of th e business to be conducted; nam es of all tlw general
and special p artners interested therein, distinguishing which we
general and which are special, and th eir respective places of resi­
dence; the am ount of capital contributed by each special partner
to the common stock; and the period a t which th e partnership is
to commence and term inate m ust be filed w ith th e clerk of the supreme
court after having been acknowledged in th e m anner prescribed ioi
P ro te s t. M ay be m ade by a n otary public under his band and
seal; or by any respectable resident of the place where the Din
dishonored, in th e presence of two or more credible witnesses, wnero
a foreign bill, appearing on its face to be such, is dishonored by nonacceptance, it m ust be duly protested for same; and where sucn »
bill which has not previously been dishonored by
is: dishonored by non-paym ent, it m ust be duly protested for saino.
If. it is not protested .the draw er and indorsers are discharged, w nero
a bill does not so appear to be a forqjgn bill, protest thereof in case
of dishonor is unnecessary. T he protest m ust be annexed to tne ujlu
or contain a copy thereof and m ust sta te the (1) tim e and pia
for presentm ent; (2) the> fact th a t presentm ent was made ana m
m anner thereof; (3) the cause or reason for protesting; (4) th e aemau
m ade and th e answer given, if any, or the fact th a t th e drawer u
acceptor cannot be found.

BA N K IN G AND COM M ERCIAL LAWS—FLORIDA
R ecords. The exemplification of th e record under th e hand of the
keeper of th e sam e, and th e seal of the office or court where such
record m ay be m ade, is good and sufficient evidence to prove any
record m ade or entered in any of th e States or T erritories of the Urfited
S ; and th e certificate of th e p a rty purporting to be th e keeper
nf such record, accompanied by such seal, is prim a facie evidence
of that fact? A copy of th e record of any deed or other instrum ent
■1 writing n o t of a testam en tary character, where th e laws of the
cr!ji-p Territory, or country where th e sam e m ay be recorded require
such record, and which has been recorded agreeably to such laws,
Md the copy of any will which said laws require to be adm itted
to probate and record, by judicial decree, and of th e decree of the
mart adm itting th e sam e to probate and record, under th e band
of tide clerk or o th er keeper of such record and th e seal of th e court
nr office in which th e record has been m ade, is prim a facie evidence
to prove the existence and contents of such deed, will, or other instru­
ment in writing, and th a t 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 m ay be expedient. A t present blm rate is
81 20 per hundred upon assessed values of real and personal property.
Assessments of real estate are fixed a t the fair cash value. Penalty
of 1 per cent per m onth for default in paym ent. Alien for real estate
taxes accrues on the date taxes are assessed, July 1st. Taxes are
w able, one-half on M ay 1st and one-half on N ovem ber 1st of each
vpar with 30 days grace for paym ent before penalty attaches. New
assessments are m ade every two years for real estate (unless im prove­
ments are p ut on) and every y ear for personal property by a perm anent
Board of Assessors. Intangibles are taxed a t th e rate of one-half of
one percentum of th e fair value thereof.
i
T rust C o m p a n ie s . T ru st companies can be organized under the
general provisions of th e code on th a t subject. No tru s t company
can be incorporated w ith less capital stock th a n $ 1 ,000 ,000 . ^M ay
do a storage business w ith a capitalization of n o t less th an $1,200,000.
Foreign companies desiring to operate in the D istrict m u s t bSJIÉS
ply with th e provisions for th e organization of tru st com panies under
the laws of this D istrict.
Wills. All wills and testam ents m ust be in writing and signed by
the testator, or b y some o th er person in his presence and by his express
directions, and shall be atteste d and subscribed in thm p re siin c e rf
the said testato r by a t least two credible witnesses. N o wffi. testa^
ment. or codicil is effectual for any purpose w hatever unless the
person making the sam e be, if a male, of th e full age of tw enty-one
S ™
f a female, of th e full age of eighteen years, and be a t
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 Jan u ary 17, 1887, and before January 1, 1902,'devising
real estate, from which it shall appear th a t it was the intention of
the testator to devise property acquired after th e execution thereof
shall be deemed, tak en and held to operate as a valid devise of ah
such property; and any will hereafter executed, which shall b y words
of general im port devise all of th e estate or all of the real estate eff
the testator shall be deem ed, tak en and held to operate
a valid
devise of an y real estate acquired, by said testa to r after th e execu­
tion thereof, unless an intention shall appear to th e contrary. W here
a devisee or legatee dies before th e testato r, leaving issue, such issue
stands in th e place of th e deceased devisee or legatee unless a contrary
Intention appear from th e will.

SYNOPSIS OF

THE LAW S OF FLORIDA
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by H aley & H eintz , A ttorneys a t Law, Jacksonville. F la.
A ccounts. Open accounts are barred in three years.
A ckno w led g m en ts m ust in every instance be under official seal,
if made in th e S tate of Florida, m ay be m ade before any judge, justice
of the peace , clerk or d ep u ty clerk of a court of record, or notary public,
or if made o ut of th e S tate, and w ithin th e U nited States, before a
United States Commissioner of Deeds appointed by th e governor of
this State, or before a judge or clerk of any court of th e U nited States
or of any state, territo ry or district, having a seal, or before a notary
public or justice of th e peace of such sta te , territo ry or district, naving
an official seal, and th e certificate of acknowledgment or proof shall
be under th e seal of/the court or officer as the case m ay be. If
out of the U nited States, before any commissioner of deeds appointed
by the governor of th e S tate to reside in such country, or any notary
public of such foreign country, or before any m inister charge d affaires,
consul-general, consul, vice-consul, commercial agent, or vice-cornmercial agent of th e U nited S tates appointed to reside m such country.
Conveyances of dower and powers of attorney for th e execution of
deeds to real estate m ust be.executed in like m anner as conveyances or
real estate. A wife’s acknowledgment m ust be taken separate and
apart from her husband. Officers m ust certify th a t th e grantors are
known to him. T he following is th e usual form adopted, viz:
State of Florida,
1
County o f........................... )
Before th e subscriber personally a p p e a r e d . . . . . . . • -• • •
his wife
. . .known to me to be th e individuals described in
and who executed th e foregoing instrum ent who acknowledged m a t
they executed th e sam e for the uses and purposes therein expressed
and the sa id .............. . . ................ ...................... -wife of th e s a id -----• •
......................... being by hie further and privily exam ined separate
and apart from h er said husband, acknowledged and declared m a t
she executed th e sam e freely and voluntarily, and w ithout fear, appre­
hension, compulsion, or constraint of, or from her said husband, and
for the purpose of renouncing and relinquishing all her right, ot w natsoever kind, in an d to said property.
Given under m y hand and seal official t h i s . . . . . . . . day o f...............
19
N otary Public.
My commission expires..................... ...................................(See notaries.)
Actions. Suits shall be begun only in th e county (or if less th an
$100 in justice district) where th e defendant re sid e , or where the
cause of action accrued, or where th e property in litigation is. ir
brought in any county where defendant does not reside, the plaintiff,
or some person in his behalf, shall file w ith th e precipe or bill m chan­
cery, an affidavit th a t the suit is brought in good faith and w ith no
intention to annoy th e defendant. This la tte r 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 th e cause of action accrued or where
the property in litigation is. Corporations (domestic) can only be
sued in a county where th ey keep an office. Foreign corporations may
be sued in any county where th ey have an agent, or where th e cause
of action accrued or where the property in litigation is.
110

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1729

A d m in is tr a tio n of E s ta te s . Upon th e d eath of a person intestate
or having made a will b u t appointing no executor, th e county judge
appoints an adm inistrator, preferring first th e next of km ; b u t if none
such apply, then, upon notice given by publication, any creditor or
suitable person. N o m inor can be appointed. If no one applies for
letters of adm inistration w ithin sixty days after death, the probate
court m ay order thé sheriff to act. The adm inistrator appointed by
m e court m ust give bond in am ount to be fixed by th e probate judge,
respect being had to th e value of th e estate. The sheriff when acting:
as adm inistrator is liable upon his official bond.. Claims against an
estate are barred after tw o years from date of notice given by adminis­
tra to r to present same. D ebts due m ore th an five years prior to death
are barred, saving to m arried women, minors and persons non compos
m entis, imprisoned, or out of S tate, three years, after rem oval of disa­
bilities. T he compensation of th e adm inistrator is determ ined by
m e 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. A dm inistrators m ust m ake annual settlem ents
before th e first day of Ju n e each year or, forfeit. Commissions. The
C ircuit C ourt is empowered to authorize adm inistrator or executor
to carry on deceased’s trad e or business for a reasonable tune.
A ffidavits m ay be m ade before any judge, clerk of th e circuit and
suprem e, courts, justice of th e peace; or notary public.
A liens. N o distinction between any citizens, except th a t th ey are
n ot allowed to vote.
A ppeals. Appellate proceedings for the common law side are by
w rit of error, which m ust be sued out w ithin six m onths from th e d a te
of th e judgm ent. The record m ust be filed in appellate court on or
before the retu rn day of th e writ, under penalty of dismissal. Ques­
tions of fact can only be tak en up by bill of exceptions, which m ust be
presented w ithin th e term of th e court unless b y special OTder th e tim e
& extended, Appeals in chancery m ay be taken within fix m onths
and th e law governing w rits of error as far as it relates to filing or
transcripts of records and proceedings. thereon and filing assignment
of errors, the d u ty of appellate court in giving judgm ent, m causmg
execution of its decrees and quashing write of error, are appUcabie
to appeals in chancery. N otice of appeal in chancery m ust be_ filed
w ith clerk and recorded in m inutes. T his gives appellate court juris­
diction.
A r b itra tio n . P arties to th e controversy m ay make a nile of court,
of any arbitration to which th ey m ay desire to subm it by filing a sta te ­
m ent of agreem ent of th e m atters th ey desire to arb itrate in writing
w ith th e court having jurisdiction, which statem ent shall include thenam es of th e arbitrators and the um pire. An aw ard upon such arbi­
tratio n can only be set aside for fraud,, corruption, gross negligence,
or m isbehavior of on© or mor© of the arbitrators or umpire, or ©vident,
m istake acknowledged by th e arbitrators or umpire, who m ade and
signed th e award.
A rre st. No arrest for non-paym ent of money unless it be for non-:
paym ent of a fine lawfully imposed.
A ssig n m e n ts a n d In so lv e n c y . Assignments by iM olvente areprovided for by law. Preferences are n ot allowed. All property,
except th a t which is exem pt, m ust be surrendered to the assignee.
Assignee gives bond and winds up estate.
A tta c h m e n t process m ay issue upon affidavit made, sôtthig forth
th a t am ount is actually due; th a t plaintiff has reason ^o ^eBeve defend­
a n t will fraudulently p a rt w ith his property before l ^ S ^ e n t can be
recovered or is actually removing his property, or is about to remove,
it out of the S tate, or resides beyond th e lim its thereof, or is actually
removing or about to remove out of th e S tate, or absconds or conceals.
himself or is secreting property o r frad u len tly disposing of same, or
actually removing, or is about to remove, beyond th e judicial circuit,
in which he, she, or th ey reside. A ttachm ent m ay also issue for a debt
not due, upon affidavit stating th a t th e debt is actually existing, and
th a t th e defendant is actually removing his. property
limits of th e State, or is fraudulently disposing of his property for
th e purpose of avoiding th e paym ent of his ju st debts or dem ands, or
is fraudulently secreting his property for such pmposes. Tffie m aking
of th e affidavit causes all debts to m ature for th e purpose of th e suit.
Plaintiff m ust give bond, w ith two sureties in a t least double tn e dept
or sum demanded. One surety is sufficient if th a t surety is a surety
company authorized to do business in th e sta te of F londa Service
of notice of th e suit m ay be either.personal or by. P ^ c a t i o n whweattachm ent is levied and property is n ot retaken
arrest allowed in civil actions. W rits of garnishm ent
both before and after judgm ent. I f issued before judgm ent plaintiff,
his agent or attorney m ust m ake affidavit th a t th e debt for which theplaintiff sues is ju st, due and unpaid; th a t th e garnishm ent applied
for is n ot sued o ut to injure either the defendant qr Hie garnishee,
th a t he does n ot believe th a t defendant will have m his possession
after execution shall be issued visible property m th is s ta te and m
the county in which suit is pending upon which a levy can be made
sufficient to satisfy the am ount of plaintiff s claim >
and except in cases in which plaintiff has had an attachm ent or
obtained his final judgm ent, .he his agent or attorney m ust enter m to
bond payable to defendant in double th e a m o u n t of th e debt, condi­
tioned to pay all costs and damages which defendant m ay sustain in
consequence of plaintiff’s im properly suing out th e writ.
B a n k s. No banking com pany sh a ll.b e organized w ith » capital
less th an $50,000, except th a t banks w ith a capital of n ot less th a n
$15,000 m ay w ith approval of comptroller,.^be organized ™
cit#
or tow n containing n ot m ore th a n 3,000 inhabitants,
w ith a capital stock of $25.000 m ay, w ith th e approval of the comptrol­
ler, be organized in any city or tow n of not more th an 6,000 inhabitants.
Savings* banks m ay have n ot less th a n $20,000 capital. Banks are
formed as other corporations are, and can
î ^ s t a r e niav
authorized b y th e comptroller. T he com ptroller of th e S tate m ay
inspect and supervise th e business of the bank, except national banks,
and inspect and examine its books, papers, documents, m inutes, and
everything pertaining to th e acts of th e bank.. Banks
to m ake full and complete reports whenever called for by th e State
Com ptroller in such form as he m ay prescribe, and advertise in
January of each year am ount of stock, p roperly,
indebtedness. Before organization the whole of the capital stock
m ust be paid in cash. Stockholders are individually liable to the
extent of th eir stock a t th e par value thereof, m addition to th e a“ 1®"“ *
invested in said shares. D irectors m ust be citizens of th e U nited
States, and own te n shares of stock of $100 per share. J be c°mptroller, w ith th e aid of the courte, winds up
affairs of im olvent
banks. P rivate bankers are subject to all penalties of th e Stete
banking laws and to .th e supervision and control of the State Comptrailer No new private banks perm itted after Ju n e 4, 1915. it> is,
a m isdemeanor to make wilful and malicious derogatory statem ents
affecting banking institutions. .
B ills of L a d in g . Bills of lading are evidence against th e earn er of
the direction by which freights are to be received earned, and delivered
__collector or holder of commercial paper, attached to a bill oî laaingth e q u antity or quality of th e goods « ¡ p r e y e d
thereby, except by express.contract m wri■mg/and. Jhe d ffic e re fK ^ te ,
and employes of th e carrier are requied to comply w ith the term s or
th e bill of lading under penalty Of crim inal prosecution.
B lu e S ky L aw . Corporations before offering for sale th e ir stocte,
bonds or other securities are required to file w ith th e S tate Comp--,
frnllffr together w ith filing fee of $5.00, the following docum ents:
statem ent showing in full detail the plan under wMch ^
proposes to tran sact business; copy o f all contracts, bonds, shocks or
other instrum ents which it proposes to sell ; nam e and. location of th e
com pany; itemized financial statem ent; an d such other fo rm a tio n ,,
as the Com ptroller m ay require. In addition to th e above such
corporation is required to file copy of its articles of incorporation. ..

1730

BA N K IN G A ND COM M ERCIAL LAWS—FLORIDA

constitution ana by-laws. All the above papers to be verified by oath
of th e president of th e corporation, or other duly authorized officer.
If'it is a foreign corporation it is required to file w ith the Com ptroller
w ritten and irrevocable consent to accept service of process on the
S tate Com ptroller as personal service upon the corporation in suits
filed against it within th e State. This consent to be pursuant to
resolution of the board of directors, shall be duly authenticated by
seal of th e corporation, signature of th e President, Secretary, etc.
T he Com ptroller and A ttorney General are required to m ake such
detailed investigation and exam ination of the affairs of th e corporation
as they deem necessary a t th e expense of th e corporation. If in the
opinion of the Com ptroller and A ttorney General the corporation
should be perm itted to sell its stocks, bonds, etc., th ey w ill issue a
perm it. N o stock m ay be sold until the perm it shall have been
received. I t is also required before stocks, bonds, etc., m ay be sold
th a t an agent be appointed by the corporation for th e sale of its
stock, bonds, etc., which agent is required to register with th e Comp­
troller as agent for such corporation. T he Com ptroller and A ttorney
General m ay if they see fit require such agent or agents to file a bond
conditioned th a t th e securities offered for sale are fair and just, and
conditioned to hold harm less th e purchasers against loss occasioned
by reliance by such purchasers on false or fraudulent representations
m ade in th e course of sale. The agent’s authority is subject to revo­
cation a t any tim e by th e Com ptroller and A ttorney General, and
autom atically expires on Ja n u ary 1st of each year. Financial sta te­
m ents are required to be forwarded to the Com ptroller and A ttorney
General upon their dem and. The Com ptroller and A ttorney General
are authorized to revoke license of such corporation to transact busi­
ness w ithin th e S tate if in their opinion th e corporation a t any tim e
is insolvent, or conducting its business in an unsafe, inequitable or
unauthorized m anner.
C h a tte l M o rtg a g e s a n d D eeds of T r u s t. All conveyances in­
tended to secure the paym ent of money are m ortgages. C hattel
mortgages m ust be recorded or the property delivered to m ortgagee
to m ake them affectual against bona fide creditors and purchasers for
value. Injunction will be granted against th e rem oval of m ortgaged
personalty from the S ta te ; can only he foreclosed by bill in chancery
unless under $100, and upon personal property, when a common law
action m ay be brought in justice of the peace court, and m ortgage filed
with precipe. T he form and effect of tru st deeds have n ot been dis­
turbed by sta tu te . I t is a crim inal offence to m ortgage personal prop­
erty more th an once w ithout th e consent of first lienor.
C h eck s a n d D ra fts . I t is a felony to obtain m oney or goods by
drawing and u tterin g check or d raft having insufficient funds on
deposit to pay same, provided th e check or d raft is presented in due
course and draw er fails to pay same, or return th e consideration
received, w ithin tw enty-four hours after w ritten notice of dishonor.
C o lla te ra l S e c u rity . I t is a m isdem eanor to sell, pledge, loan, or
in an y w ay dispose of collateral security w ithout th e consent of pledgor.
A w ritten agreem ent m ay be m ade a t the tim e of m aking th e pledge
for th e sale of th e collateral in such m anner and upon such term s as
th e parties m ay desire, b u t notice m ust be given to pledgor ten days
prior to sale.
C o n tr a c ts . S t a t u t e of F ra u d s . • In order to bind an adm in­
istrato r personally, or any one for th e debt or default of another, or
one upon an agreem ent m ade in consideration of m arriage; or upon
contracts for th e sale oflands,tenem ents,or hereditam ents or any uncer­
tain interest therein or for any lease thereof for a period longer th an
one year; or upon an agreem ent n ot to be perform ed w ithin one year,
there m ust be an agreem ent, note, or m em orandum thereof in writing
signed by th e p a rty to be charged, or some one lawfully authorized
by him . C ontracts for th e sale of personal property m ust be in w riting
or th e property m ust be delivered or earnest money paid. News­
papers an d periodicals m ust either be subscribed for or ordered in
writing.
C o n v ey an ces. (See Acknowledgments.) All conveyances of real
estate, or any interest therein for a term of years of more th an two
years, m ust be by deed in writing, signed, sealed and delivered in the
presence of a t least two subscribing witnesses; and in order to be
effectual against subsequent grantees or incum brances, m ust be
recorded. The wife’s separate estate can be conveyed only by the
jo int deed of herself and husband, and confirmed by her acknowledg­
m ent, taken separate and ap a rt from her husband. Words of lim ita­
tion unneceassy. H usband m ay convey direct to wife.
C o rp o ra tio n s m ay be organized for any lawful business under a
general law. Stockholder liable only for am ount unpaid upon sub­
scription. C harter fee of $2 for every $1,000 of capital stock, payable
to th e S tate, b u t no fee is less th an $5 and none over $250. (See
Service of Process.)
C o sts. N on-resident plaintiff required to give $100 bond to secure
costs. The defendant m ay have su it dismissed if bond is not given.
C o u rts . C ircuit courts hold two term s a year in each county,
except in tw elfth where four term s are held and in first, ninth, eleventh
and fourteenth circuits where th ey hold three term s a year, and have
original jurisdiction in all equity cases, also in all cases a t law not
cognizable b y inferior courts. C ounty courts in such counties as
have county courts have jurisdiction of amounts, n ot exceeding $500
C ounty judges, a t all tim es open for probate business, have full probate
powers, have also civil jurisdiction to extent of $100. Justice’s
jurisdiction, $100.
C re d ito rs ’ B ills m ay be brought before claim is reduced to judg­
m ent, b u t su it a t law m ust be first brought and judgm ent m ust be
obtained before decree can be rendered.
D ays o f G ra c e are abolished.
D ep o sitio n s, m ay be taken upon commission when witness resides
out of th e county, or is bound for sea, or is about to go o ut of the
S tate to rem ain until after th e trial of the cause, or is v ery aged or
infirm; or when oath is m ade th a t a m aterial p a rt of th e case or defense
depends upon the testim ony of such witness. T he tim e for the suing
out of the commission, th e nam es of the witnesses, and the nam e of
one commissioner m ust be given to opposite side a reasonable tim e
before commission is issued. P rinted instructions for th e guidance of
commissioners usually accom pany commission. Fees of not less than
$5 a witness are to be taxed as costs by th e clerk and paid by losing
party.
D escen t a n d D is tr ib u tio n of P ro p e rty . P roperty descends: 1.
To th e children and husband in equal shares. 2. If there be no
children then all to the husband or wife. 3. If th ere be no children,
husband or wife, then to th e fath er and m other in equal shares, or to
survivor. 4. If no fath er or m other th an to th e brothers and sisters
and their descendants. 5. If there be no brother or sister nor their
descendants, th en th e estate shall be divided into moieties, one of
which shall go to the paternal and one to th e m aternal branches in
the following course: 1. To grandfather. 2. To grandm other, uncles
an d aunts. 3. To great-grandfathers. 4. To great-grandm other,
brothers and sisters of great-grandfathers, etc., passing first to near­
est lineal male and th en to lineal female ancestors and their descend­
ants. T he estate of an infant decedent, if w ithout issue, leaving no
husband or wife, shall descend: 1. To fath er of infant. 2. M other of
infant. 3. B rothers and sisters of infant. 4. In case no father, m other,
brothers or sisters or th eir descendants surviving, then it descends
according to the general rules of descent prescribed by sta tu te. Halfbloods inherit only one-half. Adopted children are treated as children
of blood. B astards inherit and transm it through m other’s side, as
if legitim ate. Aliens have sam e right as citizens. T here are no
entailed estates nor right of survivorship.
D ow er. Deceased m ay n o t b y will cu t off his widow’s right to
dower. I f dissatisfied w ith term s of will, she m ay dissent within
one y ear a fter probate of will and she will th en be entitled to one-third
o f th e real estate for life, and, if th ere are two or more children, to


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

one-third of th e personalty in fee simple; if there are no children or
only one, she will be entitled to one-half the personalty. She mav
within one year elect to take a child’s p a rt in lieu of dower. If the
husband die in testate, w ithout children, the wife takes the whole
estate, or dower, a t her election.
E vidence. Witnesses not disqualified by reason of interest In
civil cases, husband and wife m ay 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 p arty or those under
whom he claims, can be given by th e opposing party , unless such evi­
dence is first offered in behalf of such lunatic representatives legatees
devises, etc. N o person is excused from testifying or producing
docum ents in trials for bribery, burglary, larceny, gambling, or illegal
sale of liquors, on ground th a t it m ay ten d to convict him 0f crime
b u t no such person shall thereafter be prosecuted or subjected to anv
penalty on account of anything concerning which he m ay so testifv
or produce evidence.
J
E x e c u tio n s. Executions can be issued im m ediately upon the
en try of the judgm ent and within three years thereafter, and are a lien
upon real estate from date of entry, and upon personal property from
the tim e the sheriff receives them . T hey can be renewed any time
within tw enty years from entry of judgm ent. B oth real and personal
property are subject to sale under execution. Executions are return­
able when satisfied, sheriff reporting progress a t each term . Sale day
first M onday in each m onth. No sta y law. N o redem ption of proDerty sold under execution.
E x e m p tio n s to every head of a fam ily residing in th e State home­
stead of 160 acres of land, and im provements, if in th e country; onehalf acre o f ground, if in an incorporated city or town, together with
$1,000 w orth of personal property. The exemptions in a city or town
shall not extend to more Im provem ents or buildings th an th e residence
and business house of the owner. N o property is exem pt from sale
for taxes or assessments, or for obligations, contracted for its purchase
or th e erection or repair of im provements thereon, or for house field’
or other labor perform ed thereon. W ages and salary of head of à
fam ily residing in the S tate is exem pt from garnishm ent.
F o re ig n C o rp o ra tio n s. Commercial corporations can do business
in this S tate w ithout restriction upon complying w ith requirements
as to foreign corporation, provided its nam e is not th e same or so
nearly sim ilar to any dom estic corporation as to cause confusion.
(See Service of Process.)
F o re ig n J u d g m e n ts . Judgm ents obtained in th e several courts
of the State, m ay be recorded in any county and have sam e force and
effect as if originally obtained therein. Judgm ents obtained in other
States or countries, m erely evidence, and have to be sued upon to be
m ade effective as judgm ents.
F r a u d . (See Lim itations of Actions.) Obtaining money or prop­
e rty under false pretense or by falsely personating another, are punish­
able criminally.
G a r n is h m e n t. (See A ttachm ent.)
G u a r a n ty C o m p a n ie s. G uaranty Companies are perm itted to
become surety upon bonds for all purposes after complying with certain
sta tu to ry requirem ents.
H o lid ay s. Defined by s ta tu te are: Sundays, Jan u ary 1st, Jan­
u ary 19th, F ebruary 22d, April 26th, June 3d, July 4th, F irst Monday
in Septem ber, second F riday in October, Thanksgiving Day, Christ­
m as and Shrove T uesday or M ardi Gras in cities where there is a
Carnival Association organized for th e purpose of celebrating it.
H u s b a n d a n d W ife. T he husband has full control of wife’s prop­
erty and is_ n ot chargeable by th e wife with th e rents and profits.
M ust be joined w ith wife in sales of her property. Homestead can
only be alienated by th eir joint deed. H usband n o t 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 m ay sue w ith respect to separate
estate w ithout husband joining. In fan t wife m ay join .husband in
sale of her real estate.
I n ju n c tio n s . Injunctions are granted w ithout bond upon affi­
davit of inability to give bond, and upon proof satisfactory to the
judge th a t such affidavit is true, and th a t the statem ents of the bill
are true. Injunctions are granted to stay proceedings a t law; to
restrain th e sale of property under execution or decree obtained against
one other th an the owner of th e property; to restrain th e destruction
of tim ber by cutting, boxing, or otherwise; to restrain a levy upon
exem pt property; to prevent th e claiming of exemptions upon property
n ot legally exem pt; to prevent the rem oval from th e State of mort­
gaged personal property, and to ab ate bawdy houses and gambling
dens.
In so lv en cy . S tatutes suspended by national bankruptcy law.
I n s u r a n c e C o m p a n ie s. Foreign and domestic, are placed, by
sta tu te, under control of S tate treasurer. T hey m ust annually file
a statem en t with, and obtain from the S tate treasurer, a certificate
before being authorized to do business. C ertificate m ay b e revoked
if com pany refuses to pay judgm ents which have been legally obtained
against it.
I n te r e s t. E ight per cent is allowed on judgm ents and contracts
where interest is payable b u t no rate is specified. C ontract for more
than 10 per cent is usurious, and all interest forfeited.
J u d g m e n ts of a 'c o u rt of record are a lien for tw enty years upon
real estate of debtor within the county where rendered, and may be
extended to other counties b y recording certified transcript of judg­
m ent in any county where a lien is sought. Judgm ents of justice of the
peace m ay be m ade a lien upon real estate by recording in the office
of clerk of circuit court.
L ie n s. In order to secure a lien by lis pendens, a statem ent must
be filed w ith the clerk of th e circuit court, and recorded by him in a
book k ep t for th a t purpose, setting forth th e nam es of th e parties, and
th e nature of the relief sought, and th e description of th e property
upon which it is desired to obtain a lien. S tatutory liens are given to
laborers and m aterial-m en. P roperty 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 am ount. Statutory
liens upon real estate, in order to be available as against subsequent
purchasers or lienors w ithout notice, m ust be recorded, and suit
m ust be brought within twelve m onths after the furnishing of the
m aterial, or the perform ance of the labor. Liens upon personal
property exist only while possession is retained by lienor.
L im ita tio n s of A ctio n s. Civil actions can only be commenced
within th e following periods after th e cause of action shall have
accrued, to wit: Actions on Florida judgm ents, actions on con­
tracts or obligations in writing and under seal tw enty (20) years;
actions for the recovery of real property, actions on judgments or
courts of the United States or any other sta te or territory seven (7)
years. On contract« in writing not under seal, five (5) years. On
all actions not herein and specifically m entioned, four (4) years.
Trespass to realty, action upon liability created by statu te other
than a penalty of forfeiture, taking, detaining or injury to chattels,
for relief on the ground of fraud, upon contract n ot founded upon
instrum ent of writing, including an action open account for goods,
wares and merchandise, three (3) years. Actions for libel, slander,
assault, battery, false im prisonm ent, or an action by another than the
S tate upon a sta tu te for a penalty or forfeiture two (2) years. Actions
for wrongful death of a child, actions against railroad companies tor
killing cattle, and any action by th e S tate for a statu to ry penalty or
forfeiture, one (1) year.

BA NKING AND COM M ERCIAL LAWS—GEORGIA
M arried W o m en retain their property, real or personal, owned
at marriage or acquired th ereafter by gift, devise, descent, or purchase,
and it is n ot liable for husband’s debts except by her w ritten consent,
executed according to law regulating conveyances of m arried women.
Husband m ust 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 m ay sue concerning her real estate w ithout joining
her husband w ith h er in th e suit. Widow takes as dower a life estate
in one-third p a rt of th e real estate of which her husband was seized
and possessed a t any tim e during her coverture, and an absolute onethird of all personalty, or m ay a t her option tak e as an heir equally
with the children of th e husband, and if th ere are no children she will
inherit all th e property, real and personal. Wife by petition to proper
court m ay be decreed a free dealer and as such sue and be sued.
M in o rs. Both sexes a tta in th eir legal m ajority a t th e age of 21
vears Minors who deposit in savings banks m ay control, transfer
or withdraw th e money so deposited. All other contracts m ade by
them are voidable except for necessaries. M arriage removes dis­
ability of non-age of male m inor.
M o rtg ag es of real estate m ust be executed and_ proved or acknowl­
edged in th e sam e m anner as deeds, and they, likewise assignm ents
thereof, to be effectual against creditors or bona fide purchasers,
must be recorded. Are foreclosed by bill in equity in th e circuit
court. C hattel m ortgages m ust be recorded unless property is
delivered to m ortgagee and rem ains in his possession; becomes subject
to debts of mortgagee if left in his possession more than two years
without th e m ortgage being recorded.
N o taries. Both m en and women over twenty-one years m ay be
appointed notaries public. T hey m ust renew commissions every four
years. M ay adm inister oaths, take acknowledgments and perform
marriage ceremony. $500 bond is required to be given. Certificate
must show date of expiration of commission.
N otes a n d B ills of E x ch an g e. Form and interpretation defined
by statu te. No requirem ent th a t it shall be m ade payable a t a bank
or any fixed place. 5 p er cent dam ages are allowed on foreign com­
mercial paper protested in this S tate. Negotiable instrum ents falling
due upon a holiday (see Holidays) are payable on the next succeeding
business day. Instrum ents falling due on S aturday are to be pre­
sented for paym ent on th e next succeeding business day, except th a t
Instruments payable on dem and m ay, a t th e option of th e holder, be
presented for paym ent before noon on Saturday unless th a t entire
day is a holiday.
P a r tn e rs h ip , L im ite d , a n d S p ecial. None.
Pow ers o f A tto rn e y . Any contract or conveyance m ay be m ade
by power of attorney. A conveyance of a m arried wom an’s real estate
by power of atto rn ey in order to be valid th e power of attorney m ust
be acknowledged by h er separate and ap art from her husband, and the
acknowledgment m ust sta te th a t she executes it freely and voluntarily,
without compulsion, fear, apprehension, or constraint of or from her
husband. T he husband m ust join either in th e deed or powers of
attorney. Powers of atto rn ey for th e conveyance of real estate m ust
be recorded. ’
P ro b a te L aw . (See Adm inistration of E states.) T he county
judge has original jurisdiction of all m atters relating to the adm inistra­
tion of estates of decedents.
P ro te st. (See N otes and Bills of Exchange.)
R ecords. Records of deeds and m ortgages are k ep t in th e office of
the clerks of th e several circuit courts, and th e original m ust be recorded
in the county within which th e property lies. Wills are required
to be recorded w ith th e several county judges and m ay be probated
in any county in which th e deceased left property, if he dies out of th e
State. If d eath takes place w ithin the State, then in the county in
which he has had residence, house, or other place of abode a t the tim e
of his death, and if he had none such, then in the county wherein he
died.
R e d e m p tio n . None, excepting tax sales.
R eplevin lies for goods or chattels wrongfully taken, except when
taken for taxes, or under execution, or a t su it 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 m ust be filed, describing property sought to be recovered,
and stating th a t it was n ot taken for any tax, fine levied by virtue of
any law of th e S tate, nor seized under execution or attachm ent against
the goods and chattels of the plaintiff; liable to execution and bond
In double the value of th e property w ith two sureties given before the
writ is issued. D efendant m ay release th e property within three days
by forthcoming bond.
Seal. A scrawl or scroll, printed or w ritten, affixed as a seal to any
written instrum ent, is effectual.
Service of P ro c ess. O ut of circuit court, m ade by th e sheriff or
his deputy. O ut of county judge’s or justice of peace courts, m ay be
made by sheriff or constable. Service in civil actions m ay be m ade
either upon th e person of th e defendant, or by leaving a copy a t his
residence with some person over fifteen years of age. Process against
a domestic or foreign corporation m ay be served upon any officer or
business agent of said corporation residing in Florida. If defendant
corporation is doing or has done business in the S tate, and the sheriff
makes return th a t he cannot serve th e process because of the corpora­
tion’s failure to elect officers or appoint agents, th e court will m ake an
order requiring defendant to appear and defend upon a rule day after
four weeks’ publication of th e order.
S u its. Actions a t law are commenced by filing a precipe w ith the
clerk. Personal service is required except in suits by attachm ent and
garnishment. W rits are returnable on the next rule day, provided
ten days intervene; if not, th en on th e rule day in the next succeeding
month. If no appearance of defendant, default is entered forthw ith.
Default m ay be entered for w ant of plea or other pleading on rule d a y ,
next after appearance day.
Taxes. Taxes are n ot due and payable until th e first day of Novem ­
ber, and if not paid by first day of the following April property m ay be
sold. Owner has two years within which to redeem. Taxes are a
Hen from th e first day of the year of the assessm ent, and have the force
and effect of a judgm ent upon which execution m ay issue.
T e stim o n y . (See Depositions.)
. T ran sfe r of S to c k . Stock is transferable in the m anner 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 th e prior holder.
W arehouse R e c e ip ts. Uniform W arehouse Receipts Act adopted,
' and effective after Ju ly 31st, 1917.
W'ills. Any person over tw enty-one years old and of sound mind
may make a will. This includes m arried women. Wills of real estate
must be signed by testa to r or some person in his presence and by his
express direction, and m ust have two witnesses who m ust subscribe
in testator’s presence. Wills of personal property m ust be in writing
and signed by th e testa to r or some one in his presence, and by his
express direction. ? N uncupative wills are good as to personal property.
Revocation m ay be by subsequent will or codicil attested like the
original, or by burning, cancelling, tearing or obliterating the same
by the testato r or by his direction and consent, or by th e act and
operation of law. Wills m ust be probated before adm ittance in evi­
dence Foreign wills, when duly probated according to laws o f the
State, where m ade and duly recorded in this S tate, are as effective
as wills executed in this S tate. Foreign wills are construed according
to law of S tate where th ey are executed.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1731

SYNOPSIS OF

THE LAW S OF GEORGIA
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by R andolph & P arker , A ttorneys a t Law.
A tlanta. (See C ard in A ttorneys’ List.)
A ck n o w le d g m e n ts. (See Deeds.
A ctio n s. All distinction betw een suits a t law and in equity is
abolished. E quitable relief can be had in superior courts of law.
A d m in is tr a tio n of E s ta te s . L etters of adm inistration issue in
th e 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 sam e degree, preference
is given to th a t one selected in writing by those m ost interested, in
th e estate. If no preference is expressed the ordinary exercises
his discretion. I f ho application is m ade by next of kin a creditor
m ay be appointed, and if no application is m ade the ordinary will
vest the adm inistration in a county adm inistrator, an officer authorized
by sta tu te for th a t purpose. A dm inistrators m ust give bond in double
th e value of th e estate. O ut of th e estate of each deceased person,
the first charge, after funeral expenses, is a y ear’s support for the
fam ily, to be laid off by commissioners according to the cpndition
and standing of th e fam ily. Foreign adm inistrators m ay act in this
S tate on giving bond to the ordinary where th ey qualify. The bonds­
m en m ust be residents of this S tate. A citizen of any other State m ay
act as executor of the will of a deceased citizen of this S tate when he
has the sam e interest and will give the sam e bond as in th e case of
foreign adm inistrators. A dm inistrators of other States m ay sue in
this S tate by filing in th e office of th e clerk of th e court, to which suit
is brought, a properly authenticated copy of th eir letters of adm inis­
tration.
A ffidavits. Pleas and defenses in th e courts of this S tate which
are required to be under oath, m ay be m ade before any official of
th e S tate or county where the oath is m ade, Who is authorized by
th e laws of such S tate or county to adm inister oaths. P rim a Facie
the official attesta tio n of the officer is evidence th a t 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 S tate, or a judge of a court of record where the oath is m ade,
w ith th e attesta tio n of th e clerk of such court th a t th e signature of
the judge is genuine, and th a t th e court over Which he presides is a
court of record.
A llens. The subjects of governm ents a t peace w ith th e U nited
S tates and this State are entitled to th e 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.
'A ppeals. (See Courts.)
A r b itra tio n . U nder th e law of Georgia disputes and controversies
relating to rights, or property, m ay be subm itted to arbitration.
A rre st. T he constitution of Georgia declares th a t there shall be
no im prisonm ent for debt. B ut in an action to recover personal
property wrongfully taken or withheld, the defendant will be arrested
by th e officer to whom process is directed, and will be com m itted to
jail unless he shall give bond and good security, or deliver up the
property, or show to the satisfaction of the court th a t it is w ithout
his power to produce it.
A s sig n m e n ts. Assignments for th e benefit of creditors are per­
m itted.
r
f
A tta c h m e n ts . A sum m ary process of attachm ent will lie m
the following cases: 1. W here th e debtor resides out of the S tate.
2. W here he is actually removing, or about to remove, w ithout the
lim its of the county. 3. W hen he absconds. 4. W hen he resists
a legal arrest. 5. W here he is attem pting to remove his property
beyond the lim its of this S tate. 6. W here he has disposed of, or
threatens to conceal, his property, liable for the paym ent of his debts,
or shall m ake a fradulent lien thereon to avoid paying his debts.
A ttachm ent will lie to recover the purchase money of an article sold
when the debtor is still in th e possession of th e property. A ttach­
m ents m ay issue upon affidavit by the plaintiff, his agent or atto rn ey 1
who m ust swear th a t one of the sta te of facts exists which authorize
an attachm ent, and also as to th e am ount o f the claim. Bond and
security, in double the am ount sworn to, m ust accom pany th e affidavit
and the officers require personal security. Non-resident corporations
are liable to attachm ents, and one non-resident m ay attach the
property of another non-resident in this S tate, except for wages
earned w ithout th e S tate.
B a n k s. Any num ber of persons, not less th an three, m ay form
a corporation for th e purpose of carrying on th e business'of banking.
Such corporations, when organized, have power to have continual
succession for th irty years, w ith right of renewal; to sue and be sued;
to have and use a common seal; to appoint officers and agents; to m ake
by-laws; to hold, purchase, dispose of, and convey such real and
personal property as m ay be necessary for its uses and business; to
discount bills, notes,, or other evidences of debt; to receive and pay
out deposits, w ith or w ithout 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 m ortgage or otherwise on property real or personal.
The business of th e corporation shall be under th e m anagem ent and
control of a board of directors, to consist of not less th an three or more
than fifteen of th e members of the corporation, who m ust be owners
•and holders of one or more shares. No bank shall be chartered w ith­
out a capital subscription in good faith of a t least $25,000, of which
not less th an 20 per cent, and in no case less th an $15,000 m ust he
paid in before filing th e declaration w ith the secretary of S tate. 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 furth er and additionally liable, equally, and ratably
(and not one for another as sureties) to depositors of said corporation,
for all m oneys deposited therein in an am ount equal to the face value
of their respective shares. All corporations doing a banking business
in this sta te shall m ake to the S tate bank exam iner, under oath,
statem ents showing the resources of the bank or corporation, a t th e
close of business on any day specified by th e bank examiner. No
bank shall loan to its officers any money without good collateral, or
other am ple security, and when such loan exceeds 10 per cent of th e
capital stock it shall n ot be m ade until approved in writing by a
m ajority of the board of directors. No bank or corporation doing
banking business shall reduce its cash in hand, including am ount due
by banks and bankers, and th e value of all stocks and bonds ^actually
owned and held, below 25 per cent of demand deposits. N o bank
or corporation doing a banking business shall loan to any one person,
unless such loan is am ply secured by good collateral security, more
than 10 per cent of its capital stock and surplus. Banks m ay charge
same rate of interest as individuals and the rules of bank discount,
th a t 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 n e t profits, nor shall the capital stock be applied to
the purchase of its own shares. If the assets of a bank are insufficient
to nay its liabilities, a receiver when aooointed, shall bring suit against

1732

BA N K IN G ASID COM M ERCIAL LAWS—GEORGIA

th e stockholders in his own nam e for th eir unpaid subscriptions. In
th e absence of a contract, expressed or implied, to th e contrary, th e
bank taking paper for collection is liable for th e defaults of its agents
an d correspondents to whom th e paper has been entrusted for collection. I f an y insolvent bank or banker, w ith notice of such insolvency,
shall receive m oney or general deposits, and fail to pay th e depositor
within th ree days after dem and, such banker or officer in charge of the
bank receiving th e deposit shall be punished as prescribed in th e
penal code. T he State has a special lien for all public m oney de­
posited. S tate banks are authorized to become m em bers of the
Federal Reserve Bank.
B ills o f f a d i n g a n d P ro m is s o ry N o tes. A bona fide assign««
of a bill of lading of goods will be protected in his title against th e
seller s rig h t of stoppage in tran sit. I t will not be necessary to protest
promisors- notes in order to bind th e endorser except in the following
case: 1. Where th e paper is m ade payable on its face a t a bank or
banker s office. 2. Where it is discounted a t a bank or banker’s
office. 3. W here it is left a t a bank or banker’s office for collection.
Accommodation endorsers, sureties and endorsers m ay be sued in
th e sam e county and in the sam e action with the m aker, draw er or
acceptor. Bills of exchange m ust be accepted in w riting to bind
th e acceptor. A contract to pay atto rn ey ’s fees cannot be enforced
unless th e d eb to r when served ten days before su it is filed w ith a
w ritten notice of intention to sue w ith am ount and term of court to
which su it will be brought, shall fail to pay such d eb t before retu rn
day. A w aiver of hom estead in a prom issory note is a bar to such a
claim as against th e collection of such note. Prom issory notes and
contracts containing reservation of title to personal property m ust
be executed before a n otary public, justice of the peace, or clerk of a
court »of record, and m ust be recorded as m ortgages to hold such
property as against th ird parties or innocent purchasers.
C h e ck s. (See N otes, etc.)
C o lla te ra ls. T he holder of a note as collateral security for a debt
stands upon th e sam e footing as th e purchaser. P roperty left in
pledge or pawn m ay be sold a t public sale to th e highest bidder, upon
th irty days notice.
C o rp o ra tio n s . Pow er to create corporations in this S tate is vested
In th e general assem bly and the superior courts. Said courts m ay
g ran t charters to all corporations except banking, insurance, canal
navigation, express, and telegraph companies and railroads. Thè
Secretary of S tate m ay grant charters for the corporations above
enum erated in m anner prescribed by law in th e particular case. A
ch arter for a private corporation is obtained by a petition to the
superior court, setting forth the object, particular business, corporation
nam e, capital, place of business, tim e for which incorporation is desired
n o t exceeding tw enty years. The petition and order granting the sam e
co nstitute th e chapter. In such corporations the liabilities of th e
stockholder is m easured by th e am ount of unpaid stock subscription
due by him. In th e charter of m any banks now organized the rule
of personal liability varies. In some banks stockholders are liable as
p artners: In others liability exists under the general rule. viz. to the
ex ten t of twice th e am ount of stock held, and in some banks liability
exists only to the extent of stock and unpaid subscriptions thereon.
T he paym ent 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 th e laws of the S tate or doing business therein are required to
register with the Secretary of S tate and pay a graded license fee, w ith
a m inim um of $10, m axim um $200. Voluntary dissolution of ’a
^ P O j a t t o m ay be granted by th e Superior C ourt upon petition filed
by th e Corporation if authorized by tw o-thirds of capital stock. Lost
stock certificates m ust be established by petition to Superior C ourt.
C o sts. A deposit of $10 is required in courts of record from
n,9nS esident Pl&mtiffs before the filing of suits and a deposit of $6 in
all divorce cases.
C o u rts . T he term , jurisdiction, etc., of th e several courts of th e
S tate are as follows: JU S T IC E COU RTS hold m onthly sessions and
have civil jurisdiction up to $100. In criminal m atters they are
only com m itting courts. COURTS OF O RD IN A R Y hold th eir
sessions m onthly and have jurisdiction over wills, adm inistration of
o i adm inistrators, executors and guardians.
CO U N TY COURTS have m onthly and quarterly sessions. T heir
jurisdiction is lim ited to controversies not exceeding $300. C IT Y
COURTS hold four sessions per annum , b ut th e city court of A tlanta
has six term s. The jurisdiction of city courts Is unlim ited except in
m atters of divorce, titles to land and adm inistration of equitable relief.
The m unicipal court of A tlanta, recently established, replaces the
Justices C ourts. Its jurisdictional lim it is $500. I t holds two term s
each m onth. SU PER IO R 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 th e crim inai
side exclusive jurisdiction of all cases involving life or im prisonm ent
in th e penitentiary.
D eed s. D eeds to real estate in G eorgia m ust be in writing, and
should be executed in th e presence of two witnesses, one of whom shall
be an officer authorized for th a t purpose. T hey should be recorded
in th e office of th e clerk of the superior court of the county where th e
land lies, and all deeds, M ortgages and other liens, should be recorded
im m ediately to be available against th ird parties and innocent pur­
chasers. To authorize the record of a deed to realty, it m ust be a t ­
tested by or acknowledged before, if executed out of this State, a
commissioner of deeds for th e S tate of Georgia, notary public clerk
or a court of record, or a consul, or vice-consul of the United S tates
(the certificates of these officers under their seals being evidence of
th e fact). W hen th e deed is executed out of this S tate before a
n o tary public, th e attesta tio n should be under his hand and official
seal. In case of acknowledgm ent it is b etter, as a m a tte r of precaution
always to have two witnesses, besides th e officer who takes th e acknowl­
edgm ent. I f executed in this S tate, it m ust be atteste d by a judge of
a SS5P of record ° f this S tate, or a justice of th e peace, or notary
public, o r clerk o f th e superior court, in th e county in which th e three
last mentioned officers respectively hold th eir appointm ent, or if subsequen t to its execution th e deed is acknowledged in the presence of
eith er of th e nam ed officers, th a t fact, certified on th e deed by such
officer, shall entitle it to be recorded. (Act of 1893.) Deeds to secure
loans are in more common use th an m ortgages because th ey have
been held to pass th e absolute title and protect against y ear’s support
and dower, th e equity of redem ption rem aining in th e m aker, can not
be levied upon until th e debt secured by th e deed has been paid
off. U nder th e law of Georgia these deeds can n ot be foreclosed as
mortgages, th e notes th ey are given to secure m ust be sued to judg­
m ent, th e land m ust be re-conveyed to th e grantor, and th en levied
on, b u t th e lien of th e judgm ent relates back to th e date of th e con­
veyance. In th e Federal courts, however, foreclosure can be m ade
in equity as in th e case of ordinary m ortgages. Usury will, however
void such a conveyance, only as to th e interest paid on such debt. ’
D e p o sitio n s. T estim ony is tak en in th is S tate by w ritten in ter­
rogatories where th e witness is a female, or where th e witness does
n o t reside in th e county where th e su it is pending, or by reason of disa­
bility is unable to a tten d court. In all counties within this State
depositions m ay be tak en upon five days’ notice to th e o th er p a rty of
th e tim e and place a t which the witness is to be exam ined. This latter
process cannot be used for taking testim ony outside of th e S tate.
Depositions m ay be taken w ithin or w ithout th e sta te , w ithout com­
mission, before a notary public or any officer authorized to issue
attacrunents. I f within th e sta te or if taken w ithout the state, before
an y officer of the sta te or county w here taken, authorized by laws of
Georgia to a tte s t deeds or take acknowledgments, upon 10 days’
Hotice to opposite p arty . In taking answers to interrogatories,
which m ust be authorized by a commission issued for such purpose
by th e court here, two commissioners m ust act. Commissioners m ust


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

be disinterested and n ot related to either party, or connected nr»«,
th e case; attorneys of the parties are incom petent. None of the narii«.
to the case, nor their agents or attorneys, can be present when thcommission is executed. The witness can only w rite his answer
the presence of the commissioners. I t is usual, and th e better p ra c tw
for one of th e commissioners to w rite th e answers of th e witness ..'
th ey are given. Depositions m ay be w ritten w ith th e tvnewHt«?
and commissioners m ay adjourn th eir sittings from day to t o
following instructions for taking testim ony are im portant- Inst™«
tions for taking answers to interrogatories: 1. In sert th e commit!
sionere nam es in the commission: any two respectable citizens will
d?- 2 . S tate the case as you find it. T hen comes th e caption thni.
S tate of. ....................
(H ere insert th e county and’ State
C ounty o f............................ ss. where th e commission is executed.)
B y virtue of a commission from th e ................... court of
county, we have caused th e person in said commission nam ed to com*
before us, who being duly sworn true answers to m ake to certain
interrogatories thereto annexed, deposeth and answereth as folio«*
(Here insert answers of th e witnesses to each interrogatory in ordar
3. L et the witness sign th e answ ers; th en say: “ Answered sworn t«
and subscribed before us, th is ___ day o f....................1 9 . . . . ” Then.
sign your own names, adding th e words “ Commissioner (L! S.) ” after
each nam e. 4. Seal all up together, using two wafers, each com­
missioner writing his nam e w ith “ Com m issioner” across a wafer or
seal. 5. S tate th e case on th e package, and address it to the clerk
or the court issuing th e commission. 6. I f it is to go by mail set
th e postm aster to receipt on th e package. “ Received from one of
th e commissioners (giving his name) the within interrogatories to be
forwarded by due course of m ail,” nam ing his post-office. Testimony
thus taken m ust be sent by mail, or by some person specially author.
Ized by th e commissioner to carry it to the court.
D e s c e n t a n d D is tr ib u tio n o f P ro p e rty . T he husband is the
sole heir to his in testate wife, unless she leave children, and in that
event th e husband and children shall inherit per capita, b ut the
descendants of children shall tak e per stirpe. I f a m an die without
children, or th e descendants of children, leaving a wife, the wife is
s°ie heir. I f there are children, or those representing deceased
children, th e wife shall take a child’s p art, unless th e shares exceed
five in num ber, in which case th e wife shall have one-fifth p art of the
estate. I f th e wife elects to take her dower, she has no further interest
in the estate. Children stand in th e first degree to th e Intestate and
inherit equally. Posthum ous children stand upon th e same footing
w ith o ther 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
«
no w'dow or children, or representatives of children. Th«
han-bioocl on the paternal side inherit equally w ith th e whole blood
T he father, if living, inherits equally with brothers and sisters, and
stands in the sam e degree. I f there be no father, and the mother
Is alive, she shall inherit in th e sam e m anner as th e fath er would
Real estate descends direct to th e heirs, and personal estate to th*
adm inistrator. B u t real estate is subject to adm inistration for the
purpose of paying debts, and if necessary, for distribution.
^ P o w e r . In this S tate th e wife is entitled to an estate for life in oneth ird of all lands of which the husband dies seized or possessed a t the
tim e o f his death, or to which the husband obtained title In right of
his wire. T here is no necessity for renunciation of dower in this State,
and a m arried woman, on th a t question, need n ot 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 th e m arital relation.
E x e c u tio n s. M ust follow the judgm ent or decree from which they
issue. T hey are good for seven years and m ay be renewed for a like
period by en try nulla bona.
E x e m p tio n s a n d H o m e s te a d s. U nder the constitution and laws
or Georgia, each head of a fam ily or guardian, or tru stee of a family
of m inor 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 exem ption of realty, or personalty, or
both, to th e aggregate of $1600. The debtor shall have power to waive
or renounce, in writing, his rig h t to th e 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 exem ption m ay be sold by th e debtor and his wife, if any, with the
sanction of th e judge of th e superior court of th e county where the
debtor resides, or th e land is situated. T he proceeds to be re-invested
upon th e sam e uses. A general w aiver in writing, of th e homestead,
or exem ption, is good.
F o re ig n C o rp o ra tio n s . All corporations, except those chartered
and organized under th e laws of this S tate, are held to be foreign
corporations. Such corporations are recognized b y com ity only:
they are subject to attachm ent, b u t have all th e rights of replevy and
defense. T hey cannot exercise any corporate powers or privileges
which b y the constitution and laws of Georgia are denied to domestic
corporations^ or th e exercise of which would be contrary to th e public
policy of this S tate. T here is otherwise no restriction upon foreign
corporations except in th e case of insurance com panies and building
■and loan associations, which are required to m ake 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 S tate’ (See Corporations.)
F ra u d . Contracts, awards, m arriages, judgm ents, sales, and wills
are void when th ey are brought about and procured by fraud. Prom­
issory notes when procured by fraud are void in th e hands of th e holder,
who so procures them . T he s ta tu te of frauds, as of force in Georgia,
requires th e following obligations to be in writing, signed by the party,
or his authorized agent, to be binding: l . A prom ise b y an executor,
adm inistrator, guardian, or trustee, to answ er in damages out of his
own estate. 2. A prom ise to answ er for th e debt, default, or mis­
carriage of another. 3. An agreem ent m ade upon consideration of
m arriage, except m arriage articles as otherwise provided. 4. Any
contract for th e sale of lands, or any interest in or concerning them.
5. Any agreem ent th a t is n o t to be perform ed in a year. 6. A
prom ise to revive a debt barred by s ta tu te of lim itations or bankruptcy.
7. Any contract for th e sale of goods, wares, and merchandise,
in existence or n ot in e sserto th e am ount of $50 or more, except the
buyer shall accept p a rt o f th e goods sold and actually receive the same
or give som ething in earnest to bind th e bargain or in p a rt payment.
8. An acceptance of a bill of exchange.
G a r n is h m e n ts . This process m ay be invoked in an y case. Gar­
nishm ent m ay be dissolved by giving bond and a th ird p arty may
claim a fund held up under garnishm ent and m ay release tn e fund by
giving bond. Any person m ay claim exem ption from garnishment as
to wages to th e extent of $1.25 per day and one-half of th e remainder.
H o lid ay s. Ja n u ary 1st (New Y ear’s D ay), Ja n u ary 19th (Lee’s
Birthday), F ebruary 22nd (W ashington’s B irthday), April 26th
(M emorial D ay), June 3rd (Jefferson D avis’ B irthday), July 4th
(Independence D ay), F irst M onday in Septem ber (Labor Day),
Decem ber 25th (Christm as D ay), Thanksgiving D ay.
I n t e r e s t . T he legal rate of interest in Georgia is 7 per cent, but 8
per cent is legal when contracted for in writing. P arties charging
usury forfeit th e excess if usury is set up. U sury has no present
penalty in Georgia, except forfeiture of all interest paid upon th e debt.
J u d g m e n ts create liens from th eir rendition upon th e real or per­
sonal property o f th e defendant; all judgm ents a t th e sam e term rank
equally, and property sold by a debtor a fter judgm ent is obtained
against him is only discharged from the lien of such judgm ent, if ieal
estate, after four years' possession by th e vendee, and in cases of per­
sonal property, after two years’. ' Judgm ents, w hether in the United
States court, or in any S tate court, obtained in any other county than
th a t in which th e defendant resides have no lien on th e property of
the defendant in any other county, unless the execution thereon is

1733

BA N K IN G A ND COM M ERCIAL LAWS— IDAHO
recorded in th e county of th e defendant's r e s id e n t. Unless such
execution is recorded as so required within th irty days, its lien will
only date from th e tim e of record. (See Actions.)
J u r is d ic tio n . (See T itle Courts.)
L icense. No license is required of commercial travelers. Itin e ran t
traders m ust pay license fees.
L iens. U nder th e laws of Georgia mechanics, m aterial-m en, ma­
chinists, employes of steam boats, millwrights, builders of gold mine
machines, stone-cutters, and m arble works laborers have special liens
on property im proved or worked on. Landlords have a general lien
which takes effect from the levy of distress and a special lien on crops
for ren t of land on which th ey 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. A ttorneys have a
special lien on papers in their hands and on property recovered in suits
brought by them or successfully defended by them .
L im ita tio n s . Suits on open accounts are barred after four years,
on promissory notes and bills after six years, on instrum ents under
seal after tw enty 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 w ithout 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.
M a rried W o m e n . T he wife m ay contract and sue and be sued in
her own nam e in respect to her sepárate estate as a femme sole, except
that she can n o t bind her separate estate by suretyship for any one.
and any prom ise 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 m ay sue and recovef from any
person money or p ro p erty used by her husband to pay his debt where
the creditor takes w ith notice. All the property of the wife a t the
time of m arriage, and all she m ay 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. T he wife with her children,
if any, is entitled to twelve m onths’ support out of the estate of her
deceased husband. The husband is bound to support and m aintain
the wife, and his consent is presum ed 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, b u t by special contract in her own capacity, and
not as agent for ber husband, she could bind her separate estate, for
that purpose. A m arried woman can dispose of her property by will.
M o rtg ag es. M ortgages are only security for debts. T hey m ay
embrace property in the m ortgagor’s possession, or to which he has
a right of possession. T hey m ay cover a stock in bulk, b ut changing
In specifics, and after acquiring property. No particular form is
necessary, b u t it m ust be cleared th a t th e instrum ent indicates a lien,
describes th e property and specifies the debt it secures. M ortgages
on land are not good against dower, and a wife cannot waive her
dower as against this lien. M ortgages m ust be executed and attested
in the sam e m anner as deeds, except th a t in mortgages on personal
property, only the official witness is necessary. M ortgages with power
of sale are valid in Georgia. Hom estead and exemption m ay be
waived In th e mortgage. All mortgages on personal property m ust
be recorded in th e county where th e m ortgagor resides and the prop­
erty is located. M ortgages on land m ust be recorded in the county
where the land is situated.
N o taries. Commercial notaries, 'male or female, are appointed
for four years by the superior courts, and for the state a t large by the
State Librarian. T hey m ust have seals and are authorized to a tte st
deeds and mortgages, and m ake protest of commercial paper. _
N otes a n d B ills of F x c h a n g e . (See Bills of Lading and Prom is­
sory Notes.) Promissory notes are negotiable by endorsem ent 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 endorsem ent or w ritten assignm ent in the
same m anner as bills of exchange and promissory notes. Endorse­
ments m ay be lim ited by express restrictions. Acceptances of bills
must be in writing. Transferers of negotiable instrum ents w arrant
that they are th e lawful holders, have the right to sell, and th a t the
instrument is genuine. Bona fide purchasers of negotiable paper
aking the sam e for value before due, and w ithout notice, are protected
against an y defense, except: 1. Non est factum . 2. Gambling,
or immoral or illegal consideration. 3. F raud in its procurem ent by
the holder. M atu rity gives notice of dishonor. N o days of grace
are allowed. Any d raft, bill of exchange or check, drawn upon an
institution or person with which the draw er has not sufficient funds
on deposit to m eet same, subjects the draw er to crim inal liability
unless the deficit is m ade up within 30 days.
P ro b a te L aw . (See A dm inistration ot E states, Deeds and M o rt­
gages.)
P ro te sts. (See Bills of Lading and Prom issory Notes.)
R ecords. (See Deeds and M ortgages.)
R e d e m p tio n . T here is no redem ption in this S tate under judicial
sales except in case of sale of property under tax execution where
parties m ay redeem in twelve m onths If im proved land and wild land
within two years.
Replevy. All property seized under attachm ent, distress, or other
similar process, m ay be replevied. , P roperty seized under process
and claimed by th e th ird p arty m ay be delivered over upon bond and
security for its forthcom ing to answer final judgm ent Of decree.
R evision. (See Courts.)
Sales. Sales m ay be m ade to pay debts, b u t any sale of stocks of
goods in bulk is deem ed fraudulent unless the seller delivers to the
buyer a list of all creditors and th e am ount due each. I t shall then be
the duty of th e buyer to notify th e creditors of his purchase. This
notice m ust be mailed five days before completion of the purchase.
Taxes. Taxes aré 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 th e estates. Sales of property for taxes are con­
ducted in th e sam e m anner as other judicial sales. One year in which
to redeem is allowed.
W ills. All persons of full age and sound and disposing memory,
including m arried women, m ay m ake wills, and dispose of their estates.
Wills m ust be executed in the presence of three witnesses, all of whom
shall be present, m ust be called by the testa to r as witnesses, and m ust
sign, and shall certify th a t th ey signed, in th e presence of th e testator,
and in the presence of each other. Wills m ust be in writing, except
nuncupative wills. Wills of citizens of other States, where executed
according to the laws of the S tate, and probated in solemn form in
such State, which dispose of real or personal property in Georgia, may
be adm itted to probate in this S tate, when an authenticated copy of
the will is presented, accompanied by a certificate of the governor of
such State, under th e seal of the S tate, th a t the official of the court
where such probate was m ade, had original jurisdiction of the subjectmatter. Wills are probated in the court of ordinary in the county
where the testato r resides a t the date of his death. All wills executed
out of this S tate by citizens of this S tate to dispose of property in
Georgia m ust be executed according to our law. A foreign will,
executed according to th e law of Georgia, will constitute a m unim ent
of title to real property w ithout being probated in this S tate, when
recorded on th e record of deeds in the county where th e land lies,
together with an exemplification of record adm itting it to probate
m another State, certified according to th e Act of Congress.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

SYNOPSIS OF

THE LAW S OF IDAHO
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by R ichards & H aoa, A ttorneys a t Law, Boise.
in A ttorneys’ List.)

(See Card

A c k n o w le d g m e n ts. All conveyances and other instrum ents
required to be acknowledged in this S tate m ust be acknowledged, If
within the S tate, before a judge or clerk of a court of record, a county
recorder, a notary public, or a justice of the peace. I f w ithout the
State, b u t w ithin the U nited States, th ey m ust be acknowledged before
any such officer, or a commissioner of deeds for this S tate, or before
any officer authorized by th e laws of this S tate or T erritory to take
such acknowledgment. If w ithout th e U nited States, th ey m ust be
acknowledged before a m inister or charge d ’affairs of the U nited
States, resident and accredited in the country where the acknowledg­
m ent is taken, before a consul of vice-consul, a judge Of a court of
record, a duly appointed commissioner, or a notary public. The
certificate of acknowledgment, if m ade before a justice of the peace,
when used in any county other th an th a t in which he resides, m ust
be accompanied by a certificate, under the hand and seal of the recorder
of the county in which the justice resides, setting forth th a t such
justice, a t th e tim e of taking such acknowledgment, was authorized
to take the same, and th a t th e recorder is acquainted w ith his hand­
writing, and believes th a t the signature is genuine. Proof of the
execution of an instrum ent m ay be m ade though it has not been
acknowledged. Form of m arried wom an’s acknowledgment th e
sam e as th a t of a single person. (See Conveyances.)
A ctio n s. T here is b u t one form of civil action in this á ta te . As
action is commenced w ithin th e m eaning of th e sta tu te when the
com plaint is filed w ith the clerk. E very action m ust be prosecuted
in th e nam e of the real p a rty in interest.
A ffidavits are used only to verify pleadings, to prove service of
summons, notice, or o ther paper, to obtain provisional rem edy.
A liens. Anti-Alien bill prohibits aliens not eligible to citizenship
and corporations, a m ajority of whose members are such aliens, from
acquiring or holding real estate except to th e extent and for th e purr
poses prescribed by existing treaties between their countries and th e
U nited States, b u t perm its such aliens to leave lands for not more
th a n five years. Also prohibits such aliens from acting as guardian
or tru stee for any real estate and provides th a t lands hereafter conveyed
to such aliens shall escheat to th e estate. (Law 1923, p. 160.)
A r b itra tio n . Persons capable of contracting m ay subm it to
arbitration any controversy which m ight be th e subject of a civil
action between them , except a question of title to real property in
fee or for life.
A rre sts. The defendant m ay be arrested in a case for th e recovery
of m oney or dam ages on a cause of action arising upon a contract,
express or implied, when th e defendant is about to depart from the
S tate with in ten t 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 th e defendant has been guilty of
fraud in contracting th e debt, or in concealing or, disposing of personal
property, for th e taking or conversion of which th e action is brought;
or when th e defendant bas or is about to remove or dispose o f his
property with in ten t to defraud his creditors.
A s sig n m e n ts a n d In so lv en cy . An insolvent debtor m ay be
discharged of his debts by executing an assignm ent of all his property,
real and personal, which, w ith a sworn inventory of property and
schedule of creditors, m ust be filed in th e district court. A t a cred­
itors’ m eeting, held after th irty days’ notice given, one assignee is
appointed, and claims proved. C ourt will be set aside property
exempt, and issue order for direct paym ent of money, where no
m ortgage or pledge had been given, or where such security, if given,
has been rendered neugatory by act of defendant. Assignee m ust
furnish bond, w ith tw o sufficient sureties.
A tta c h m e n ts . A ttachm ents m ay'be had in actions on judgm ents
or contracts express or implied where defendant is a non-resident or
the deb t is unsecured. Plaintiff a t the tim e of issuing th e summons
or any tim e afterw ards m ay obtain th e attachm ent upon filing affi­
davit and undertaking and notice of attachm ent m ust be published.
B a n k s a n d B a n k in g . Idaho has a full and com plete law upon
the form ation and regulation of banks and th e form ation of banking
corporations. No banking corporation can have less th an five
directors. All banks, other th an national banks, are under the super­
vision of th e Commissioner of Finance. T he banker has a general
lien, dependent upon possession, upon all property in his hands belong­
ing to a custom er for th e balance due him from such custom er in the
course of th e business. (Compiled S tatutes 1919, secs. 5205-5304,
Laws 1921, p. 55.)
B ills of L a d in g . Uniform act recom m ended by the American
B ar Association.
B lue Sky L aw . Idaho has a blue sky law governing corporations,
unincorporated associations and partnerships, dom estic or foreign,
dealing in stocks, bonds, and other securities, excepting U nited States
bonds. S tate or municipal securities in Idaho, and Idaho real estate
m ortgages. This law requires th e filing of various statem ents,
accounts; and other papérs, and m akes it unlawful to do business in
th e S tate w ithout compliance. (Compiled S tatutes 1919, secs. 53055324, Laws 1921, pp. 29, 297, 375, Laws 1923, p. 125.) '
C o lla te ra ls. No sta tu to ry regulation.
C o m m u n ity P ro p e rty . All property acquired after m arriage
other th an by gift, bequest, devise, or descent, is com m unity property.
The personal earnings of th e wife and th e income from her separate
property are her separate property.
C o n tr a c ts . A w ritten instrum ent is presum ptive evidence of a
consideration.
C onveyances. Real estate is conveyed by instrum entan writing,
subscribed by the p arty or his authorized agent in writing. The
com m unity property can be conveyed or incum bered only by husband
and wife joining in th e execution. D uring th e continuance of th e
m arriage th e wife has the m anagem ent, control, and absolute power
of disposition of her separate property, and m ay bargain, sell, and
convey her real and personal property, and m ay enter into any con­
tra c t w ith reference to the same, in the sam e m anner and to th e same
extent and w ith like effect as a m arried m an m ay 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 instrum ent
purporting to grant real property to take effect upon condition pre­
cedent, does not pass th e estate upon th e perform ance of th e con­
dition. Such instrum ent is m erely an executory contract. (See
Acknowledgments.)

1734

BA N K IN G AND COM M ERCIAL LAWS— IDAHO

C o rp o ra tio n s. P rivate corporations m ay be formed by three (3)
*55?"® Persons. a t least one of whom m ust be a bona fide resident
or this S tate. Such corporation is formed by executing articles
of incorporation, containing: 1. The nam e of the corporation. 2.
1 he purpose for which it is formed. 3. The place where its prin­
cipal business is to be transacted. 4. T he term for which it is to
exist (not exceeding fifty years). 5. T he num ber of its directors or
trustees, not exceeding fifteen, who m ust be stockholders of the
corporation. 6. The am ount of the capital stock and the num ber
of shares into which it is divided.
7. T he am ount actaully sub­
scribed, and by whom. T he articles m ay provide for the election
of one-third of its directors annually. Railroad, wagon road, telegraph
and telephone corporations m ust sta te also in their articles: 1. The
km'a of road, telegraph or telephone line intended to be constructed.
—. ¿h e estim ated length of the road or line. 3. T hey m ay provide
in th eir articles the num ber of directors which shall co n stitu tea quorum
for th e transaction of business, the decision of the m ajority of such
quorum to be a valid act. 4. W hether m eetings of th e board «hn.il
be held w ithin or w ithout the S tate. 5. W hether stockholders shall
be individually liable f or debts of corporation. Railroad corporations
m ust have subscribed, before filing articles, $1,000 per mile; wagon
road corporations, $300 per mile; telegraph corporations, $100 per
mile, and the articles m ust be verified by affidavit o f president, secre­
tary , or treasurer nam ed in articles, th a t such stock has been sub­
scribed. All articles of incorporation m ust be filed in th e office of the
county recorder, in which th e principal place of business is located,
and a copy thereof certified by th e recorder, filed w ith th e Secretary
of S tate. All corporations, except insurance, non-productive mining
companies, co-operative telephone and irrigation companies, m ust
pay between Ju ly 1st and Septem ber 1st of each year, a license fee
based on th e am ount of authorized capital stock, varying from $10 to
®i50; a failure to m ake paym ent by Septem ber 1st entails a penalty
of $10, and a failure to m ake paym ent by N ovem ber 30th entails a
loss of charter for dom estic corporations and a loss of the right to do
business within th e S tate for foreign corporations. Between July 1st
and Septem ber 1st, all corporations m ust m ake an annual report, and
a failure to do so takes aw ay such exem ptions as are m entioned above.
C o rp o ra tio n , F o re ig n . Foreign corporations desiring to do busi­
ness in th is S tate, m ay have all th e rights and privileges of like domes­
tic corporations, by filing with th e secretary of S tate, and in the
office of th e county recorder of the county where th e principal place
of business of such corporation is to be conducted, a copy of their
articles of incorporation, and the designation of some person residing
m th e 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
S tate m ay be served. Designation of agent m ust be filed with Clerk
of D istrict C ourt Instead of C ounty Recorder.
C o u rts . Term s and Jurisdiction. T he judge of th e district court
of each of the judicial districts of th e S tate m ust annually fix the
tu n e for holding th e district court in th e several counties of his dis­
tric t; and he m ay hold such special term s as he deems proper and
necessary. D istrict courts have original jurisdiction in all civil cases.
P robate courts are held in each county continuously, and have juris­
diction up to $500, in civil cases and concurrent jurisdiction with
ju stic e s courts in all crim inal cases. Justices’ jurisdiction, $300.
C u rte s y does n ot exist.
D ays o f G ra c e abolished by sta tu te.
D e p o sitio n s m ay be taken before any judge, justice of the peace,
notary public, or United States commissioner, or any other person
agreed upon by th e parties, upon notice served upon the opposite
p arty, sta tin g the court, action, tim e, and place, and before whom
th e sam e will be taken, or th ey m ay be taken upon commission issued
by th e judge with interrogatories attached.
D e v o lu tio n of P ro p e rty . (See Succession.)
D ow er does not exist. (See C urtesy and Com m unity property).
E m p lo y ees a n d E m p lo y es. All persons employing mechanics or
laborers m working mines, erecting or repairing buildings, construct­
ing canals, railroads, etc., m ust m ake, record, and publish a sta te ­
m ent, under oath, setting forth th e following: T he nam e of the
owner of th e prem ises where work is being done or upon which it is
intended to begin work; the nam e of the person or com pany engaged
m or who contem plates engaging in work upon such prem ises; the
conditions under w hich, such person or corporation is prosecuting
th e work as agent, owner, .etc., the principal office of the owner ana
th e agent m this State; th e tim e and place where paym ent of laborers
and mechanics will be m ade. A copy of th e sta te m e n t m ust be
posted a t th e place where work is prosecuted.
oy.el.’s l i a b i l i t y L aw . Provides for dam ages not to exceed
$5,000 for injuries to employes caused by em ployer's negligence. (See
W o rk m en s Com pensation Act).
E x e c u tio n s issue a t any tim e w ithin five years after judgm ent.
T he only stay is by appeal, w ith supersedeas bond. One year allowed
for redem ption from execution and foreclosure sale.
E x e m p tio n s . Hom estead, n ot exceeding $5,000, if declaration
of hom estead is duly acknowledged and recorded; office furniture
and lib rary ,, $200; necessary household and kitchen furniture not
exceeding in value $300, and provisions for fam ily for six m onths;
certain farm animals, etc., w ith food for six m onths; and w ater
right of 160 inches, when actually used in irrigation; also crops grow­
ing or grown on fifty acres of land, leased, owned or possessed by
person cultivating the same; tools or im plem ents of mechanic neces­
sary for his trad e of the value of $500; all instrum ents of surgeons
etc., also all professional libraries; m iner’s dwelling of value $500, and
his pipes, cars, etc., of the value of $200; pack anim als and equip­
m ents, not exceeding $250; team , wagon, etc., of draym an; seventyfive per cent of th e personal earnings of a debtor within th irty days
preceding levy, where earnings are necessary for use of family, resid­
ing in this S tate; the shares held by parties of the Building and Loan
Association to the value of $1,000; provided, such person has no
hom estead; all benefits arising o ut of life insurance, represented by
an annual prem ium of $250; all property of fire companies. All the
above p roperty m ay be sold under foreclosure of mortgage, which
includes sam e or execution issued on judgm ent for purchase price.
G a r n is h m e n t. Any personal property or credits in th e hands of
another, belonging to th e defendant, is subject to garnishm ent, as
are debts owing to him from another if due.
G u a r a n ty , T itle a n d T r u s t Co. M ay furnish abstracts, act as
surety, trustee, fiscal agent. Paid up capital of $25,000 required.
C apital deem ed security for th e perform ance of th eir duties.
H o lid ay s. Jan u ary 1st, F ebruary 22nd, M ay 30th, June 15th,
(Pioneer D ay), F o urth of July, first M onday in Septem ber (Labor
D ay), O ctober 12th, Thanksgiving D ay, Christm as, Sundays and
any day on which a general election is held.
H u s b a n d a n d W ife. All th e property of th e wife owned by her
before m arriage, and th a t acquired afterw ards by gift, bequest, or
descent, or th a t which she shall acquire with the proceeds of her
separate property and her personal earnings and the income from
her separate property, shall rem ain her sole and separate property, to
th e sam e extent and with the sam e effect as the property of a hus­
band sim ilarly acquired. T he wife has the m anagem ent, control, and
absolute power of disposition of her separate property, to the same
ex ten t and with like effect as a m arried m an m ay have in relation
to his real and personal property. The separate property of the
wife is not liable for the debts of her husband, b ut is liable for her
own debts contracted before or after m arriage. T here is no estate
by courtesy or in dower. . M arriage settlem ents are provided for,
and when properly executed and recorded m ay vary the sta tu te
governing th e relations of husband and wife concerning property
rights.. M inors m ay execute valid m arriage settlem ents


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

, I n te r e s t. W here there is no express contract in writing flxine »
definite rate of in te re st, the rate is 7 per cent per annum
ParH»i
m ay agree in writing for interest a t a rate not to exceed 10 per cent no,
annum . Judgm ents bear interest a t th e rate of 7 per cent per annum
compound interest allowed.
“ i,
J u d g m e n ts are liens on all real estate of debtor within the countv
from tim e of docketing, and m ay be extended to other counties hv
filing transcript in recorder’s office. Lien continues five veans
Justice s court judgm ents become liens when certified and recorded'
M ay be revived by issuing execution w ithin lim itation.
L ie n s, M e c h a n ic s’. E very person perform ing labor upon or fur
nishing m aterials used in the construction or repair of any minim/
claim, building, or other im provem ent, has a lien thereon. Farm
laborers have lien upon the crop and products thereof, upon which
th ey bestow labor. All liens m ust be set forth bv a statem ent in
writing, showing the am ount due. the facts connected with the m atter
th a t there are no credits due on the claim, or offsets against the
same; which statem ent m ust be verified by the claim ant, and recorded
m the office of the county recorder, if on claim of original contractor
withm ninety days, if on claim of other persons, within sixty davs
from the tim e of the com pletion of th e stru ctu re the completion of the
labor, or the furnishing of th e m aterials. Lien m ust be enforced bv
suit within six m onths, unless credit is given, expires a t all event«
in two years.
L im ita tio n fo r S u its . Judgm ents six years; w ritten contracts
or for real property, five years; contracts or obligations not founded
on w riting 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 p a rt paym ent of principal or interest.
M a rrie d W o m en . AH property, real or personal; acquired before
marriage and acquired after marriage, by gift, bequest, devise or
descent, and her personal earnings and the income from her separate
property are the wife’s separate property; all other property acquired
after m arriage, common property; wife m ust record inventory of
separate personal property. No estate as ten an t by courtesy allowed
the husband nor dower to the wife.
M in e s a n d M in in g . (Principal regulations under United States
S tatutes.) Quartz locations m ay be 1,500 feet long and 300 feet on
each side of the middle of lode. M onum ents m ust be established at
all exterior angles of claim. Claim should be tied to some natural
or perm anent m onum ent. Copy of location notice m ust be posted
a t discovery within three days after discovery. Notice of location
m ust be recorded within ninety days after location; within sixty days
ten-foot shaft m ust be sunk or its equivalent. Location notice must
contain nam e of locator, nam e of claim, date of discovery, dimensions
distance from some perm anent, natural, or artificial object; name of
mining district, county, and state. Placer locations made in same
m anner as quartz locations, except th a t within fifteen days after
making location, locator m ust excavate not less th an 100 cubic feet
for purpose of prospecting claim, and m ust record notice of location
within th irty days after m aking location.
M o rtg ag es. A real estate m ortgage m ust be acknowledged and
certified, and recorded in like m anner as conveyances and deeds
of r e a , property, and is foreclosed by action in th e district court.
G nattel M ortgages m ust be acknowledged as real estate mortgages
and sworn to by the m ortgagor th a t the sam e is m ade in good faith
w ithout any design to hinder, delay, or defraud creditors. M ust be
filed and a m inute record m ade by recorder, unless mortgagee has
possessiqn. Survives as long as the debt. M ortgages are discharged
by a satisfaction duly executed and recorded, or by en try on margin of
the record, witnessed by recorder.
N e g o tiab le I n s t r u m e n t s . Negotiable instrum ents are governed
by the rules of the Uniform N egotiable Instrum en t Law, as recom­
mended by th e American B ar Association. (See Laws 1903, p. 380.)
N o ta rie s, when requested, to dem and 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 T erritory, State, govern­
ment, or country m ay be performed by notaries. A ttach acknowl­
edgments or proof of powers of attorney; m ortgages, deeds, grants,
transfers,^ and other instrum ents of writing executed by any person.
Give certificate of such proof or acknowledgment, to take depositions,
affidavits, and adm inister oaths and affirmations in all m atters incident
to duties of the office. To keep a record of all official acts; when
requested, and upon paym ent of his fees therefore, to m ake and give
a -?e.r ?i, e<^, c°Py ° f any record in his office; to provide and keep an
official seal, on which m ust be engraved his name, th e words “ Notary
Public, and the nam e of the county for which he is commissioned.
To authenticate with his official seal a h official acts. The commission
is good throughout th e State.
P ow er of A tto rn e y . Powers of atto rn ey for grants of real estate
and to execute a m ortgage m ust be in writing, subscribed, acknowl­
edged or proved, certified and recorded as other instrum ents affecting
real property. Powers of attorney which have been recorded must
be revoked by revocation in writing, acknowledged, proved, certified,
and recorded the sam e as original power.
P ro b a te L aw . _ P robate courts have jurisdiction to open and
receive proof of wills and_ adm it them to proof; to grant letters testa­
m entary and guardianship and revoke same; appoint appraisers of
estates, compel executors, etc., to render accounts; order sale of prop­
erty of estates and m inors; order paym ent of debts due from estates,
order and regulate distribution of property or estates; compel attend­
ance of witnesses and production of all instrum ents pertaining to
estates and property of minors, and m ake such orders as m ay 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.
P ro te s t. (See Notaries.)
R e c o rd s .. All deeds, m ortgages, real and chattel, and instruments
affecting the title to lands m ust be recorded. Inventory of the
separate personal estate of a m arried woman when recorded, becomes
prima facie. evidence th a t the property therein enum erated is her
separate property. In case of levy of attachm ent upon real estate, a
copy of the writ, with a copy of the notice of levy attached thereto,
m ust be filed in the office of th e county recorder.
R e d e m p tio n . P roperty m ay be redeem ed within one year after
sale, on paying purchaser am ount paid on sale and 10 per cent addi­
tional. P roperty m ay be redeem ed by successive redemptioners
within sixty days from last redem ption, and within one year from
sale, by paying an additional 4 per cent. In cases of tax sales, the
owner m ay redeem in three years
R ep lev in . Action of, m ust be brought w ithin three years from time
it accrues; Plaintiff m ay sue for the possession w ithout claiming
im m ediate possession, or he m ay claim im m ediate possession a t time of
commencing suit or afterw ard. Affidavit showing th a t plaintiff is the
owner, the detention, the unlawfulness of the detention, etc., and bond
with sureties required to obtain im m ediate possession. Defendant
m ay execute undertaking, with approved sureties, for th e retention of
the property, and th a t 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.
S ales. Uniform sales Act recommended by American Bar Asso­
ciation.
S eals. _ The distinctions between sealed and unsealed instruments
are abolished. W ritten contracts presum ptive evidence of con­
sideration.

BANKING AND COM M ERCIAL LAWS— ILLINOIS
S uccession to P ro p e rty . If decedent leave spouse and one child
each entitled to one-half of decedent’s separate property, both real and
personal; If more th an one child, surviving spouse gets one-third and
remainder in equal shares to surviving children. In the case of
community property, the surviving spouse takes all th e property
subject to the rig h t of testam entary disposition of one-half thereof by
the decedent. (See Wills.)
Taxes. Ail property m ust be assessed with reference to its value
at twelve o’clock noon on the second M onday of Ja n u ary of each
year a t its full cash value, and the owner or other claim ant of the
property shall have th e sam e listed for taxation, and such taxes are
a lien from and after th a t date. If taxes are not paid by th e fourth
Monday in December they become delinquent, b ut half of th e taxes
may be paid before said date and the rem aining half before th e fourth
Monday in Ju n e without delinquency. A penalty of 2 per cent Is
added on all delinquent taxes. Delinquency entries are m ade as of
the first M onday in Jan u ary in th e succeeding year by th e tax collector
and have th e force and effect of a sale to th e county. T hey bear
interest a t th e ra te of 10 per cent per annum from date and are not
assignable. Redem ption m ay be m ade w ithin four years from the
date of such entry. N otice of expiration of redem ption period m ust
be given by tax collector n ot less th a n three, nor more than five m onths,
before such expiration in order to entitle county to deed. A sta tu te
applying to taxes for the years 1920-1922 inclusive, perm its re­
demption from delinquent taxes on paym ent of th e am ount of the
original tax, less penalties with 7 per cent interest add the same sta tu te
permits redem ption from tax deed as long as the property is held by
the county upon paym ent of the am ount of th e origina Itax, less
penalties together w ith 7 per cent interest and any tax subsequently
assessed with like interest. (The Constitutionality of th is sta tu te
has been upheld by the Supreme C ourt of Idaho in th e case of W ash­
ington C ounty vs. Paradis, 37 Idaho— , 219 Pac.— ) (Compiled
Statutes, 1919. Chap. 144, Laws 1921 p. 520, Laws 1923, pp. 49, 236.)
T ru st C o m p a n ie s. (See G uaranty Companies.)
W arehouse R e ceip ts. The Uniform W arehouse Receipts Act,
recommended by th e American Bar Association.
Wills. E very person over the age of eighteen years, and of sound
mind, m ay m ake a will. E very will, other th an a nuncupative will,
must be in writing, and every will other th an an olographic and a
nuncupative will, m ust be executed by the testa to r subscribing thereto
or some person by his direction, which m ust be done in the presence
of two attesting witnesses, each of whom m ust sign his nam e and
state th a t the testa to r requested him ,to witness the testato r’s signa­
ture, and th e testa to r m ust also declare in the presence of th e wit­
nesses th a t such is his last ■will and testam ent. One-half of com­
munity property m ay be disposed of by will to his, her or their children,
but not to exceed one-fourth to a parent or parents of either spouse.
W o rk m en ’s C o m p e n s a tio n A ct. See C hapter 236 Compiled
Statutes 1919, am ended Laws 1921, p. 474.)

SYNOPSIS OF

THE LAW S OF ILLINOIS
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by M ichael J. Stanton, A ttorney a t Law, 538 S. C lark S treet,
Rand M cN ally Bldg., Chicago. (See Card in A ttorney’s List.)
A ck n o w led g m en ts. Of deeds of real estate and other instrum ents,
may be taken before th e following officers: W ithin this S tate before
a master in chancery, notary public, U nited States commissioner,
county clerk, justice of th e peace, any court of record having a seal
or any judge, justice, or clerk thereof. W ithout this State, and within
the United States, its territories, dependencies, or the D istrict of
Columbia, before a justice of the peace, notary public, m aster in chan­
cery, United States commissioner, commissioner to take acknowledg­
ments of deeds, m ayor of a city, clerk of a county, or before any judge,
justice, clerk or d eputy clerk of the suprem e, 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 th e U nited States, such acknowledgment or
proof may also be taken or m ade before any commissioned officer in
the military service of the U nited States. When such acknowledg­
ment or proof is m ade before a notary public, U nited S tates com­
missioner, or commissioner of deeds, it m ust be certified under his
seal of office. If taken before a m ayor of a city, it m ust be certified
under the seal of the city ; if before a clerk, deputy clei k, prothono­
tary, registrar, or surrogate, under the seal of his court; ir before a
justice of the peace or a m aster in chancery, there m ust be added a
certificate of th é proper clerk under the seal of his office setting forth
that such person was a justice of the peace or m aster in chancery a t
the time of taking such acknowledgment or proof. An acknowledg­
ment or proof of execution m ay be m ade in conformity with the laws
of the State, Territory, dependency, or district where it is m ade.
Without the U nited 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, m inister, or
secretary of legation, or consul of the U nited States, or vice-consul,
deputy consul, commercial agent, or consular agent of the U nited
States. The acknowledgm ent of a conveyance by a m arried woman
may be m ade and certified as if she were single. .A n acknowledgment
taken by any one interested in the conveyance is void.
A ctions. Form s of action and pleadings are substantially as a t
common law except in justice courts and the municipal court of Chi­
cago, wherein th e practice has been much simplified. A non-resident
» required to give a bond for costs.
A d m in istra tio n o f D e c e d e n ts’ E s ta te s . .L etters testam entary
»sue to executor nam ed in will, if he be a resident. If there be no
will, or no executor nam ed, or the executor is disqualified, or refuses
ro act, adm inistration is granted to surviving husband, or wife, next
of kin. or some com petent person. T he surviving husband or wife,
or the person nom inated by him or her, has preference. I f none of
the above nam ed applies w ithin sixty days from death of deceased*
then adm inistration is granted to the public adm inistrator of the proper
county. The adm inistrator m ust be a resident of the S tate. A
foreign executor or adm inistrator, within the United States, m ay
prosecute suits to enforce claims or to sell lands to pay debts. The
Uniform Foreign P robate Act is in force in Illinois. The executor
or adm inistrator m ust file an inventory within three m onths from the
date of his appointm ent and m ust fix upon a term of court, w ithin
six months from th e tim e he qualifies, for the adjustm ent of claims.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1735

an d publish notice thereof. T he claim ant should produce and file
his verified claim, which, if n ot objected to, m ay be allowed without
further evidence. If objected to, the claim is set down for trial. If
the claim is n ot presented a t th e tim e fixed upon, it m ay afterw ards,
within one year, from th e date of the issuance of letters of adminis­
tration, be filed w ith th e clerk, whereupon a summons issues against
the executor or adm inistrator, and the m a tte r is heard a t a subsequent
term . All claims n ot exhibited within one year from granting_of
adm inistration are barred. Claims are classified as follows: .1. Fu­
neral expenses and cost of adm inistration. 2. Widow’s or children’s
award. 3. Expenses of last illness, other than physician’s bill, and
dem ands due household laborers or servants of deceased for labor.
4. D ebts due common school or township funds. 5. Physician’s
bill for last illness. 6. T ru st funds. 7. All other debts. Claims
have priority of paym ent in the above order.
A ffidavits. W ithin this S tate oaths and affirmations m ay be
adm inistered by any judge, justice of the peace, m aster in chancery,
clerk of a court, police m agistrate, or notary public, in their respective
jurisdictions. W ithout th e S tate the o ath or affirmation m ay be
adm inistered by any officer authorized by the laws of the particular
S tate, and if such officer has a seal, his certificate under his official
seal is received as prim e facie evidence of his authority.
A liens. The present law w ent into effect July 1, 1897. I t does
not affect the rights of aliens as to personal property, who still take
the sam e as citizens. Its provisions are subject to treaties m ade by
the United States with foreign countries. All aliens, subject to cer­
tain restrictions m entioned in the act, m ay acquire and for a lim ited
time hold real estate situated in this S tate by deed, devise, or descent,
and m ay transfer devise or encum ber it.
A rre s t a n d B ail. No person can be imprisoned for deb t unless
upon refusal to deliver up his estate for the benefit of his creditors
In such m anner as shall be prescribed by law, or in cases where there
is a strong presum ption of fraud.
A s sig n m e n ts. The operation of the Illinois Act relating to
voluntary assignm ents for the benefit of creditors has been suspended
by th e national bankruptcy law.
A tta c h m e n ts . A creditor, resident or non-resident, whose claim
is due, m ay bring attachm ent in a court of record if the am ount
exceeds $20, and in justice court for any am ount not exceeding $200,
on any of the following grounds: I. W here the debtor is a non-resi­
den t of this State. 2. W here th e debtor conceals himself, or stands
in defiance of an officer so th a t process can not be served upon him.
3. W here the debtor has departed from this S tate w ith the intention
of having his effects rem oved from this State. 4. W here the debtor
is about to depart from this S tate w ith th e intention of having his
effects rem oved from this State. 5. W here the debtor is about to
remove his property from this State to the injury of such creditor.
6. W here 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. W here th e
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. W here 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. W here the debt sued for was fraudulently
contracted on the p a rt of the debtor, provided th e statem ents of th e
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. T he creditor m ust give bond in double the
am ount of the claim. Real estate or personal property m ay be
attached or funds garnished. The property or funds m ay be released
by the debtor giving a forthcom ing bond, or entering into a recog­
nizance in court to pay the judgm ent.
B a n k s a n d B a n k in g . Under th e sta te constitution stockholders
have a double stock liability, and every bank m ust m ake, under oath,
and publish each quarter a full and accurate statem ent of its affairs.
An Act to revise th e law in relation to banks and banking was
passed and approved June 23, 1919, and ratified by 'referendum a t
the election of N ovem ber 2, 1920. Banks m ay be formed under the
sta tu te for th e purpose of discount and deposit, buying and selling
exchange, and doing a general banking business, except the issuing
of bills to circulate as money; m ay loan on both personal and real
estate security, and m ay accept and execute trusts. An association
of persons, not less th an three, m ay organize a bank by filing a state­
m ent w ith the Auditor, giving the place of business, am ount of capital,
name and duration, whereupon th e Auditor issues a perm it to organize.
The shares shall be $100 each. A fter the perm it to organize is issued
*nd the stock fully subscribed, the stockholders m eet, fix the num ber
of directors and elect the directors who shall manage the corporation
for one year, or until their successors are elected. A t the election of
directors, stockholders have the right of cum ulative voting. The
directors elect one of their num ber President, appoint the necessary
Officers and employes, fix their salaries and m ake by-laws. Each
director shall file with th e State A uditor an affidavit th a t he will
faithfully perform the duties of his office in accordance w ith law; th a t
he is th e owner in his own right, of ten shares of the stock of the bank,
free from incum brance. T he directors m ust cause suitable books to
be kept and file with the Auditor a list of stockholders and a copy of
any o ther records the Auditor m ay require. Unless another day is
fixed by the by-laws of the Association, th e stockholders shall m eet
the first M onday in January and elect directors. Vacancies are
filled by vote of tw o-thirds of th e directors. E ach director m ust
own ten shares of th e stock of th e bank and file a certificate or certif­
icates thereof w ith the Cashier, to be held during his term as director.
A quorum of the directors m ust m eet once each m onth. Any officer,
director or employe who shall m ake a false statem ent to any official
authorized to examine th e affairs of the bank, upon conviction shall
be punished by im prisonm ent of not less than one or more th an ten
years. W hen the S tate A uditor is satisfied on exam ination th a t the
bank has been duly organized and its stock fully paid,, he issues a
certificate th a t th e bank is authorized to commence business, which
certificate m ust be filed w ith the Recorder of D eeds of the county in
which th e bank is to carry on its business.
T he double liability of stockholders applies to all debts contracted
while th ey hold stock in th e bank and is not released by an assignment
of th e stock. The President or Cashier m ust, w ithin th irty 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 w ithin ten days after such transfers. A statem ent of the
resources and liabilities of the bank m ust be filed w ith the State Auditor
when required by him . The A uditor m ust call for such report a t least
once each three m onths. T his report m ust be published in a news­
paper of th e city or town where th e bank is located.
The S tate A uditor shall appoint a suitable person, not connected
with th e bank, to m ake a thorough examination of the affairs of each
bank once a year, and report th e same to the Auditor. A bank m ay
hold only such real estate as m ay be necessary for a banking house or
such as m ay be acquired in the collection of debts. Real estate
acquired for debts m ust be disposed of within five years._ The total
liability for money borrowed of any person, corporation or firm
(including the m em bers of the firm) to any banking association shall
a t no tim e 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 th e capital stock actually paid in. Provided, however, th at
m oney borrowed within the m eaning 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 negotiating the same; (3) th e purchase
of or loaning m oney in exchange for, evidences of indebtedness which
shall be secured by m ortgage or tru st deed upon productive real
estate, the value of which, exclusive of buildings, as ascertained by
th e oath of two disinterested appraisers, is double the am ount of the
principal debt secured; and (4) the purchase of, or loaning money m

1736

BAN K IN G AND COM M ERCIAL LAWS— ILLINOIS

exchange for, evidences of indebtedness secured by a w ritten pledge
covering live stock, the president, vice-president or cashier or such
bank or association certifying a t th e tim e of such purchase or loan
th a t th e value of such live stock is double the principal d eb t secured;
b u t in no event shall th e liabilities of any such person, corporation or
firm to such bank exceed th e am ount of its capital stock, or 25 per
■cent of its deposits. D irectors are m ade personally liable for any
violations of this provision to the extent of the loss occasioned thereby
to th e bank, its stockholders or any other party. No loan shall be
m ade to ti^e President, Vice-President or any empl oye of the bank
until th e loan shall have been approved by the Board of Directors.
T he minimum am ounts provided for the capital stock of banks
-are as follows: In cities, towns and villages th a t have not exceeding
five hundred inhabitants, $10,000; betwen five hundred and fifteen
hundred, $15,000; between fifteen hundred and five thousand, $25,000;
between five thousand and ten thousand, $50,000; between ten thou­
sand and fifty thousand, $100,000; between ten thousand and fifty
thousand, $50,000, provided deposits shall n ot exceed $500,000; over
fifty thousand $100,000. Upon im pairm ent of the capital stock,
th e A uditor m ay require assessments of stockholders or a re­
duction of th e capital.
If he shall deem the bank is being
•conducted in an unsafe-, fraudulent or illegal m anner, he m ay file
a bill for an injunction, dissolution and receiver, b u t such
a bill can be m aintained only in th e nam e of the Auditor. Upon
deficiency of assets, the court m ay require, in such a suit, th a t the
receiver proceed against th e stockholders on th eir stock liability.
T here are provisions for consolidation, change of nam e and voluntary
dissolution. All banking associations heretofore organized by general
or special Act, are m ade subject to all the provisions of this Act.
A fter January 1, 1921, no natural person or natural persons, firm
o r partnership shall transact th e business of banking or the business
of receiving money upon deposit, or shall use the word “ B ank” or
“ B a n k er” in connection with said business; provided, th a t nothing
herein contained shall be construed to prohibit banks incorporated
under th e laws of this S tate or of th e U nited States from appointing
natu ral persons as agents to receive deposits of savings in and through
th e public schools. Any person violating th e Act is guilty of a mis­
dem eanor and is subject to a fine not exceeding $1,000, or imprison­
m ent in the penitentiary for one year. A banker is liable to fine and
im prisonm ent 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
in ten t to defraud, and knowing a t the tim e th a t he had not sufficient
funds in or credit w ith the bank to pay the cheek, d raft or order in
full is guilty of a m isdemeanor and is subject to a fine of $1,000 or
im prisonm ent for one year, or both.
B ills of L a d in g . T he Uniform Bills of Lading Law is in force in
Illinois.
B lu e S ky L aw w ent into effect June 10, 1919, governing the
sale of stocks of corporations. Securities are divided into four classes.
C ertain securities can be sold only after a full statem ent in regard
thereto has been filed w ith th e Secretary of S tate and a perm it issued
The law is stringent. Copies of the law and forms for use thereunder
•can be obtained by w riting to the office of the Secretary of State,
Springfield, 111 The act is entitled “ The Illinois Securities Law.”
C h a tte l M o rtg a g e s. No m ortgage, tru st deed, or other convey­
ance of personal property having the effect of a m ortgage or lien, is
valid against th ird persons, unless possession be delivered to, and
rem ain with the grantee; or the instrum ent provides for the possession
of th e p roperty to rem ain w ith the grantor, and the instrum ent is
•acknowledged and recorded. The instrum ent m ust be acknowledged,
in counties having a population of less th an tw o hundred thousand,
before a justice of th e peace, police m agistrate, a clerk or deputy clerk
of a municipal court, or county judge of th e county in which the m ort­
gagor resides; in counties having a population of 200,000, or more,
before a justice of th e peace of th e town or precinct, or if there be no
justice of th e peace, before th e clerk or deputy clerk of th e municipal
court in th e district where th e m ortgagor resides. If th e m ortgagor is
a non-resident of th e S tate, the m ortgage m ay be acknowledged before
an y officer authorized bv law to take acknowledgments of deeds.
A fter acknowledgment and w ithin ten d ay s after its execution the
•instrum ent m ust be filed for record w ith th e recorder of th e county
in which th e m ortgagor resides when th e instrum ent is executed,
or, in case of a non-resident of th e State, th en in the county where
th e p roperty is situated. The m ortgage is a valid lien u ntil ninety
•days after th e m atu rity of th e entire debt or obligation, n ot exceeding
th ree years from th e filing of th e mortgage, and m ay be renewed for
one year. A note secured by chattel mortgage, m ust sta te on its
•face th a t it is so secured, otherwise th e m ortgage is void. A m ortgage
m ay be released on th e m argin of th e record, or by a release deed.
A m ortgage on a stock of goods perm itting m ortgagor to retain
-possession and buy and sell is void as to creditors.
C o m m e rc ia l P a p e r. (See Negotiable Instrum ents.)
C o n d itio n a l S ales and like agreem ents, including, generally,
leases, reserving title or lien in seller who parts with possession, are
•not valid in this S tate as to purchasers or parties acquiring liens
while th e property rem ains in th e possession of the vendee or lessee.
C o n s ig n m e n ts . Agreements to sell on consignment are valid.
I f a. commission m erchant, or p arty selling on commission, converts
th e pro p erty consigned, or after dem and fails to account for the pro­
ceeds, he is subject to fine and im prisonm ent, and liable for double
th e value of the property so converted.
C o n v ey an ces. (See Deeds.)
C o rp o ra tio n s. Corporations, except for charitable, educational,
penal, and reform atory purposes, m ay be organized only under gen­
eral laws. (Const, a rt. X I, 1.) In all elections of directors every
• stockholder has the right to vote, in person or by proxy, for th e num ber
of shares of stock owned by him, or m ay cum ulate his votes. (Const,
art. X I, 13.)
A new act relating to corporations for profit, became in force
July 1, 1919. C orporations m ay be created under tne act for any
lawful purpose, except for banking, insurance, real estate, brokerage,
th e operation of railroads, or th e business of loaning m oney; and m ay
‘be organized also, for any one of th e following purposes: (1) “ building
corporations,” for acquiring, owning, erecting, leasing, or operating
only one building and the site therefor of n ot more th an 80,000 square
■feet of land; (2) “ agency and loan corporations,” for the purpose of
acting as agents for others in th e purchase, sale, renting, and m an­
agem ent 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 m ortgages or tru st deeds on real estate or leaseholds or on the
m ortgage bonds of industrial or railroad companies or of any public
-service corporation, or on any S tate, m unicipal, or quasi-municipal
bonds, or for the purpose of buying, selling, pledging, mortgaging, or
otherwise dealing in any of such securities; (3) “ real estate im prove­
m ent corporations,” for th e purpose of owning land, erecting resi­
dences thereon, and selling or leasing such land or residences, which
lan d so owned shall be situated only in the county in which th e cor­
poration’s principal office is located.
Corporations under th e act have th e following rights, powers, and
privileges: (1) succession; (2) to sue and be sued in its corporate
name;_(3) common seal ;(4) capital stock, w ith or w ithout a par value,
•and divided into classes; (5) to acquire, and to own, possess, and
■enjoy so m uch real and personal property as m ay be necessary for
th e transaction of, th e business of such corporation, and to lease,
m ortgage, pledge, sell, convey, or transfer the same; (6) to own,
purchase, or otherwise acquire, w hether in exchange for th e issuance
■of-its own stock, bonds, or other obligations or otherwise, and to
hold, vote, pledge, dr dispose of the stocks, bonds, and other evi­
dences of indebtedness of any corporation, dom estic or foreign;


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

(7) to borrow m oney a t such ra te o f Interest as th e corporation mw
determ ine w ithout regard to or restrictions under an y usury law of
this S tate and to mortgage or pledge its property, both real ani
personal, to secure the paym ent thereof; (8) to elect officers aDniW
agents, define their duties and fix their compensations; (9)’ to lea««
exchange, or sell all of the corporate assets w ith th e consent of twol
thirds of all of th e outstanding capital stock of th e corporation ¡u
any annual m eeting or any special m eeting called for th a t putdosh •
(10) to m ake by-laws not inconsistent with the laws of this State for
the adm inistration of the business and interests of such corporation(11) to conduct business in this S tate, other States, th e District of
Columbia, th e Territories, possessions, and dependencies of the
United States and in foreign countries, and to have one or more
offices o ut of. this S tate, and to hold, purchase, m ortgage, and convev
real and personal property outside of this State necessary and reauisitn
to carry out the object of th e corporation; (12) In tim e of war to
transact any lawful business in aid of th e U nited States in the prose­
cution of war, to m ake donations to associations and organizations
aiding in war activities, and to loan money to the State or Federal
Governm ent for w ar 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 th e purpose for which
such corporation is formed.
T he 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 com petition, nor to create a monopoly. No cor­
poration, except as specifically provided herein, shall be organized
under this act for th e 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; b u t corporations created, or to be created
under th e provisions of the act. to buy, sell, or otherwise deal in notes
(not including the discounting of notes), open accounts, and other
sim ilar 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 m ust consist of a t least three persons, who
shall be stockholders and one of whom ■m ust be a resident of this
S tate. The directors exercise, the corporate powers of the corporation.
They m ay hold m eetings and transact business outside of this State!
They elect officers, adopt by-laws, and m ay appoint an executive
com m ittee. The nam e of a corporation m ust indicate th at it is a
corporation. I f the nam e of a person or copartnership is used, it
m ust be followed by the word "corporation,” “ incorporated."
“ lim ited,” or their abbreviations. T he corporation m ust maintain
an office or place of business in this S tate, with a resident officer or
agent in charge. T he Secretary of S tate m ust be kept informed of
any change of address of such office or place of business.
Bach share of stock when issued shall nave stam ped thereon the
am ount actually received by the corporation for such stock, either in
cash, property, services rendered, or expenses incurred. Bach certi­
ficate m ust contain a statem ent of the rights of the holder, whether
the stock has been fully paid, and if not w hat per cent of it has been
paid. W hen additional paym ents are m ade th ey m ust be stamped
on th e certificate. Shares w ithout par value shall be represented
by certificates which shall sta te the num ber of shares, the name of
th e holder and the total num ber of shares the corporation is author­
ized to issue. All stockholders’ m eetings m ust be held within this
S tate. Directors are elected a t the regular annual r meeting of the
stockholders. N o stock can be voted which shall have been trans­
ferred on the books of th e corporation w ithin ten days prior to such
meeting. No proxy is good after eleven m onths 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 th e corporation, only to th e am ount unpaid on th e shares held by
them . An assignee of unpaid stock, w ith notice, is liable as though
he had been the original subscriber; b u t only the real owner is liable.
F o re ig n C o rp o ra tio n s . 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 m aintains an office in this State,
procurerà certificate of authority therefor from th e Secretary of State.
No foreign corporation shall engage or continue in any kind of business
in this State, th e transaction of which by domestic corporations is
not perm itted by the laws Of this S tate. Each licensed foreign cor­
poration shall keep on file in the office of the Secretary of State a
copy of its charter and all am endm ents thereto; and also a verified
statem ent giving th e location of its principal office in this State and
the nam e and address of an agent on whom service of process may be
had. No foreign corporation doing business in th is State without a
license shall be perm itted to m aintain any suit a t law or in equity
in any of the courts in this S tate upon any dem and, whether arising
o ut of contract or to rt; and all such corporations shall be liable by
reason thereof to a penalty therefor of n ot less th an $250 nor more
th an $1,000,- to be recovered in any court of com petent jurisdiction,
in a civil action to be begun and prosecuted by the Attorney-General.
Bach corporation including railroads, dom estic and foreign, other
th an hom estead associations, building and loan associations, banks,
religious corporations, insurance companies, and corporations not for
pecuniary profit shall m ake a report In writing to the Secretary of
S tate between F ebruary 1 and M arch 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
num ber; 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 tangible property located in
th is S tate and such other inform ation as m ay be necessary or appro­
priate in order to assess the annual license fee or franchise tax.
F ees a n d T axes. To the Secretary of S tate on filing a certificate
of incorporation one-tw entieth of 1 per cent upon the amount of
authorized capital stock, b u t in no event less th an $20. If the stock
has no par value, for the purpose of fixing the fee th e shares are con
sidered as having a par value of $100 each. A like fee upon any sub­
sequent increase. Upon the filing of a certificate of amendment
additional fee of $20. A foreign corporation, other th an an insurance
com pany or building and loan company, upon obtaining a certificate
to do business in Illinois pays the sam e fees upon the amount of its
capital stock represented by business transacted and tangible property
in Illinois as sim ilar dom estic 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 are considered to have a par value
of $100 each. A domestic corporation or a foreign corporation
licensed to do business in Illinois (except insurance companies), and
which are required to m ake annual reports, m ust pay to the Secretary
of S tate an annual license fee or franchise tax amounting to 5 cents
on each $100 of th e proportion of its authorized capital stock repre­
sented 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 th e annual report th at tne
corporation has no tangible prooerty located in this S tate, ana 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. $-4ib
betw een $500,000 and $1,000,000, $50; between $1,000,000 ana
$10,000.000, $200; over $10,000,000, $1,000; stock of no par value
.being considered to have a p ar value of $100 per share. The franchise
tax is payable on July 1 for th e succeeding twelve months, u a

BA N K IN G A ND COM M ERCIAL LAWS— ILLINOIS
corporation fails to m ake an annual report w ithin th e tim e required,
the Secretary of S tate assesses a franchise tax on the best available
information, adding a penalty of 10 per cent on the am ount of such
assessment. In case a corporation rails to file an annual report or
pay its franchise tax as required by th e act, the A ttorney-General
may take proceedings to forfeit its charter. No corporation required
to pay a franchise tax or fee under th e laws of this S tate shall transact
any business in th is S tate or m aintain any action a t law or suit in
equity, unless such corporation shall have paid such franchise tax or
such fees when th e sam e become due and payable. Corporations
are taxed on th eir tangible property, real and personal, within the
State, and also upon th e fair cash value of their capital stock. Including
franchises, over and above the assessed value of their tangible prop­
erty. Shares of stock of domestic corporations, whose tangible prop­
erty or capital stock is taxed, are n ot subject to taxation In the hands
of owners.
A corporation organized for th e purpose of accepting and executing
trusts m ay be appointed assignee or trustee by deed, and executor,
guardian, or tru stee by will, and any court m ay appoint such com­
pany receiver, assignee, guardian, conservator, executor, adminis­
trator, or other trustee, provided such appointm ent apply to the
estate only and n o t to th e person. Such corporation is not generally
required to give bond for th e perform ance of a trust, b u t it is required
to deposit with th e A uditor of Public Accounts $200,000 in bonds of
the United States, or in municipal bonds of this S tate, or real estate
mortgages, and to m ake a statem ent, and file reports with the Auditor
annually. T here 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, m ay do a
surety business.
C ourts. 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 th an 70,000); probate courts (in counties having
over 70,000); m unicipal courts (Chicago has a municipal court with
a chief justice and th irty associate judges and special practice); and
justice courts.
Rays of G race are abolished. (See Negotiable Instrum ents.)
Deeds conveying land should be signed, sealed, and acknowledged
by grantor. Scrawl seal is sufficient. No subscribing witnesses are
required. S tatu to ry forms of w arranty and quit claim deeds and
mortgages are provided. T he words employed are (1) conveys and
warrants, (2) conveys and q uit claims, (3) m ortgages and warrants.
No deed releases th e right of hom estead unless it contains a clause
substantially as follows: “ H ereby releasing and waiving all rights
under and by virtue of th e hom estead exemption laws of the State
of Illinois,” in which case the certificate of acknowledgment should
contain the clause, “ including the release and waiver of th e right
of homestead.” To release dower th e husband or wife m ust join in
the conveyance, except in th e case of a m ortgage for purchase money;
otherwise th e husband and wife m ay convey as unm arried. Deeds
and other instrum ents affecting real estate should be recorded In the
county where th e real estate is situated; until so recorded they are
void as to creditors and subsequent purchaser^ w ithout notice.
Depositions.^ In chancery cases if the witness resides in the
county, depositions m ay 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 th e witness resides in another
county or is abo u t to dep art from the state; W here the witness
resides out of th e county or state, the deposition m ay be taken before
a notary public or commissioner on a commission issued on ten days'
notice, either on w ritten or oral interrogatories; one day additional
notice of th e tim e 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 S tate, or of any other S tate or country,
declines to appear or testify he m ay be cited before the circuit court
of the county where he resides and be compelled to appear, testify
and produce docum ents.
Descent a n d D is tr ib u tio n . P roperty in this State, real and
phonal, of residents or non-residents dying intestate, descends and
is distributed as follows: 1. To the children and their descendants
equally, the descendants of a deceased child or grandchild taking
the share of their parents in equal parts. 2. When there is no child,
nor descendant of a child, and no widow or surviving husband, then
to the parents, brothers, and sisters and their descendants equally,
allowing to th e parents, if living, a child’s part, or the survivor a
double portion; and if th ere is no parent living, then to the brothers
ana sisters and th eir descendants. 3. When there is a widow or sur­
viving husband, and ho child or descendant of a child, one half of
the real estate and th e whole of the personal estate goes to th e widow
or surviving husband absolutely, and th e other half of the real estate
“fien d s as in other cases where there are no children or descendants
. uit j ren- 4- Wben there is a widow or surviving husband, and also
ft cnlla or descendants of a child, the widow or surviving husband
receives one-third of th e real estate and one-third of th e personal
estate absolutely (see Dower and C urtesy). 5. I f there is no child or
aescendant of a child, and no parent, brother, or sister, or descendant
w parent, brother, or sister, and no widow or surviving husband,
me estate descends in equal p arts to th e next of kiD in equal degree
by th e Civil Law ), th ere being no representation among
excePt w ith descendants of brothers and sisters, and
?? mstinction being m ade between kindred of the whole and th e half
6.
In case of a widow or surviving husband, and no kindred,
me whole estate goes to th e widow or surviving husband.
.hP®weL A surviving husband has dower (i. e„ life interest in a
luirci part of all lands whereof deceased was seized of an estate of
wueritance during marriage) th e sam e as a widow. E quitable estates,
contracbed for before death, are subject to dower. Dower
3 d® “arced by jo inture assented to; by devise, unless widow or
husband renounces benefit of devise within one year from
f“,,® of letters of adm inistration; by divorce as to the p a rty in
and by abandonm ent coupled with adultery. T here is no
uuwer in land as against a purchase-m oney lien. T he husband or
If
renounce any devise under the will of the other and take
ehnH- be ebildren, dower and one-third of personal estate, or, if no
jiaren, one-half of both real and personal estate absolutely. •
Executions. (See Judgm ents and Executions.)
Executors a n d A d m in is tr a to rs . (See Adm inistration.)
O0om ? i ^ n s -K ^k o re is a hom estead exemption to the extent of
*1000.' I t m ay be extinguished by conveyance jôïnedln" by "husband
and
properly acknowledged. (See Deeds.) The following
fiihioo property is exem pt: 1. T he necessary wearing apparel,
books- and fam ily pictures. 2. One hundred dollars
whmTi?
property, to be selected by th e debtor, and in addition,
SSnn J
1S fbe head of a fam ily and resides w ith the same,
K s „¡?rth °£ other property, to be selected by the debtor. Exempof ¡m
,no*' be claimed o ut of partnership property. The wages
aro o J ^ pl°?ee being th e head of a fam ily and residing w ith th e same
exempt from garnishm ent to th e am ount of $15 per week.
1 ^5<ls’«®t a £u t e o i* Tbe following contracts should be in w riting:
Promise of an executor or adm inistrator to answer any debt or
defaiio ou“ bis own estate. 2. A promise to answer for th e debt,
sidfirntLor ptfscarriage of another. 3. An agreem ent m ade in conone v o o i of_m arriage. 4. An agreem ent not to be performed w ithin
thernjrip ", Any contract for the sale of lands, or any interest
ror a longer term than one year. 6. Express tru sts relating


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1737

to real estate. •' a contract to sell or a sale of any goods or cnoses
in action of th e value of-five hundred dollars or upwards is n ot enforcible by action, unless th e buyer accepts p a rt of th e goods or choses
In action so contracted to be sold or sold, and actually receives th e
same, or gives som ething in earnest to bind th e contract, or in p a rt
paym ent, or unless some note or m em orandum in writing of th e
contract or sale be signed by the p arty to be charged or his agent in
th a t behalf. The act applies to sales for future delivery and to goods
to be obtained or m anufactured by the seller, b u t not to sales of goods
to be m anufactured on special order if th ey be not suitable for sale
to others in the usual course of business. ”
G a r n is h m e n t. The funds or property of a debtor in the possession
of a third p arty m ay be garnished in an attachm ent suit, or in a separate
proceeding after judgm ent has been obtained against the principal
debtor. (See A ttachm ents.)
H o lid ay s, L eg al. January 1st, F ebruary 12th, F ebruary 22d,
M ay 30th, Ju ly 4th, October 12th, December 25th, first M onday in
Septem ber (Labor D ay), Thanksgiving Day, and Tuesdays next after
the first M ondays in Novem ber in even years (election days); also
every Saturday from 12 o’clock noon to 12 o’clock m idnight. W here
holidays fall on Sunday, th e day following.
H u s b a n d a n d W ife. (See M arried Women.)
I n te r e s t. E xtrem e contract rate, 7 per cent; legal rate, 5 per cent.
Interest is allowed a t the legal rate on m oneys after they become due
on any bond, bill, promissory note, or other instrum ent in w riting;
on money loaned or advanced for th e use of another; on money due
on the settlem ent of an account, from the date of ascertaining th e
balance; on money received to the use of another, and retained w ith­
out th e owner’s knowledge; and on money withheld by an unreason­
able and vexatious delay of paym ent. Judgm ents or decrees draw
Interest a t 5 per cent. P enalty for contracting for more th an 7 per
cent is th e loss of the entire interest, and only th e principal sum can
be recovered. A w ritten contract, wherever payable m ade, in this
S tate between citizens of this S tate and of a foreign S tate (or secured
by a m ortgage on lands in this State) is controlled by the law of this
S tate as to the rate of interest, and the penalty for usury. Usury
m ust be specially pleaded. B ut corporations cannot claim a for­
feiture of legal interest on account of usury. In all com putations
of tim e, and of interest and discounts, a m onth is considered to mean
a calendar m onth, and a year twelve calendar nonths, and a day
the thirtieth p a rt of a m onth. A foreign corporation is subject to
the sam e penalties for usury as a citizen of this State.
J u d g m e n ts a n d E x ecu tio n s. A judgm ent is a lien on real
estate situated in the county where the judgm ent is rendered, for
seven years from its date. If an execution is not issued on a judgm ent
within one year the judgm ent ceases t.o be a lien. A transcript of a
judgm ent in another county m ay be filed and thereupon becomes a
lien upon real estate of the defendant in the county where filed, and
execution m ay issue thereunder. An execution becomes a lien on
personal property from the tim e it is delivered to th e officer to be
executed. All goods and chattels, including money and stock in a
corporation, m ay be levied on. Personal property m ay be sold under
execution on ten days’ notice. A forthcoming bond m ay be given
by th e defendant to the officer. A third p arty claiming the property
levied on m ay have a trial as to the right of property in the county
court. Judgm ents m ay be confessed by a debtor or his authorized
attorney w ithout process in term tim e or vacation.
L ie n s. A landlord has a lien for re n t upon crops growing on th e
demised premises. Hotel, inn, and boarding-house keepers have a
lira 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, m aterials furnished thereto, and the
expenses bestowed thereon a t the request of the owner, or the person
having the possession thereof. Agisters and persons keeping, yarding,
and feeding domestic anim als have a lien therefor. All persons furnish­
ing supplies, or doing work for any railroad organized under th e laws
of this State, necessary for the construction, m aintenance, 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 th e commencement of the delivery of supplies, or th e doing of
the work. A ttorneys have liens on all demands, claims, and causes of
action of their clients, after the service of notice upon the adverse
party. C ontractors and sub-contractors, including architects, super­
intendents, timekeepers, etc., have liens on any real estate, interest
therein, or im provements thereon, for all kinds of labor and services
perform ed, and m aterials furnished for the erection of any building,
or th e im provem ent of any real estate, or thing connected therew ith.
A person furnishing m aterial, apparatus, fixtures, m achinery or labor
to a contractor for a public im provem ent, has a lien upon the money,
bonds or w arrants due or to become due under such contract: Pro­
vided, the claim ant serves upon the m unicipality a notice of his claim
before paym ent be m ade to such contractor; b u t the lien attaches only
to the portions of th e money, bonds, or w arrants against which no
voucher or other evidence of indebtedness has been issued and delivered
to the contractor.
L im ita tio n s . In personal actions as follows: Libel and slander,
one year; actions for dam ages for injury to persons, two years (where
d eath results, one year after d e a th ); for false imprisonm ent, malicious
prosecution, for a sta tu to ry penalty, for abduction, seduction, or
crim inal conversation, two years; actions on unw ritten contracts,
express or implied, on awards o f 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, w ritten leases, w ritten
contracts, or other evidences of indebtedness in writing, ten years;
b u t any paym ent or new promise to pay in writing renews the right of
action on such instrum ent for ten years from the tim e of such paym ent
or promise. A dom estic judgm ent of a court of record, tw enty years;
of a foreign court of record, five years.
L im ite d P a r tn e r s h ip . T here are sta tu to ry provisions as to th e
form ation of lim ited partnerships, b u t such partnerships are n ot
common in Illinois.
M a rrie d W o m en . A m arried woman m ay sue, be sued, or defend,
as if she were unm arried. W hen th e husband deserts, th e wife m ay
prosecute or defend in his nam e. The husband has the same right
upon the desertion of th e wife. T he husband is not liable for the
wife’s to rts except in cases where he would be jointly responsible
if the m arriage did not exist. The husband or wife is not liable for
the debts of the other incurred before m arriage, or for the separate
debts of each after m arriage, except th a t the husband and wife are
jointly and severally liable for the expenses of the fam ily and the
education of their children. The wife m ay contract as if unm arried,
except th a t she can n ot carry on a partnership business without th e
consent1of Ifer husband, unless he has abandoned her, or is insane,
or confined in the penitentiary. She m ay receive and use her own
earnings free from the interference of the husband or his creditors.
N either the' husband nor the wife can recover compensation for a n y
labor performed or services rendered for the other. She m ay own
in her own right real and personal property obtained by descent,
gift, or purchase, and manage, sell, and convey it to the sam e extent
th a t the husband can property belonging to him ; b ut no transfer off
personal property between the husband and wife living together is.
good as against third persons, unless acknowledged and recorded a s
chattel m ortgages are required to be. A m arried woman who w ithout
her fault lives ap art from her husband m ay m aintain an action for
reasonable support and m aintenance. T he wife m ay insure h er
husband’s life. She m ay become surety for the husband. She m ay
execute a will, if over eighteen years of age, a t which age she a tta in s
m ajority.

1738

BA N K IN G AND COM M ERCIAL LAWS—IND IA NA

M o rtg a g e s. Real estate m ortgages should be executed and ac­
knowledged the sam e as deeds. T he wife m ust join to bar dower,
except in m ortgages for purchase-m oney. T ru st deeds are often
preferred to m ortgages because of the facility in th e transfer of the
security and. in case of non-resident creditors, in obtaining a release,
•the tru stee generally being a resident. Real estate mortgages m ay
b e released upon th e record or by release deed. M ortgages and
tru st deeds m ust be foreclosed by scire facias or by regular foreclosure
su it in a court of chancery. In extrem e cases, where the mortgaged
p roperty is clearly of less value th an th e debt seem ed and th e m ort­
gagor is insolvent, there m ay be a strict foreclosure which cuts off the
rig h t of redem ption, in which case the m ortgagee takes the property
in discharge of th e debt. In other cases, after decree of foreclosure,
th e officer designated to execute the decree delivers a certificate there
o f to th e creditor and files a copy thereof for record. The debtor m ay
redeem w ithin twelve m onths, or if no judgm ent creditor redeems,
th en w ithin fifteen m onths; a t th e end of which tim e th e real estate
is sold to satisfy th e decrèe and costs, w ith six per cent interest. The
holder in due course of a note seem ed by a m ortgage or tru st deed on
real estate in Illinois stands in no b etter position, so far as th e enforce­
m en t of his seem ity is concerned, th an th e payee or original holder;
b u t th is doctrine does n ot apply to corporate bonds payable to bearer.
N e g o tia b le I n s t r u m e n t s . The ’‘Uniform N egotiable In stru ­
m ents L aw ” is in force in Illinois, as to ail commercial paper executed
after Ju ly 1, 1907, w ith th é following modifications: 1. All Promissory
Notes, Bonds, D ue Bills, and o ther instrum ents in writing, whereby
one promises or agrees, to pay any sum of m oney or articles of personal
property, or any sum of money in personal property, or acknowledges
any sum of m oney or article of personal property to be due, are nego­
tiable. Except as to Prom issory N otes payable in m oney due diligence
m ust be used by the holder against the m aker, if he be a resident
and solvent, by suit a t first term of C ourt after m aturity, in order to
hold th e endorser. 2. Accommodation paper m ay be issued after
m atu rity , if such was the intention of th e accom m odating party.
3. The addition of words of assignm ent or g uaranty to a blank indorse­
m ent does n ot affect the signature as an indorsem ent unless otherwise
expressly stated. 4. T he defenses of fraud and circum vention in
th e execution of negotiable paper, or th a t the consideration arose
o u t of a gambling transaction prohibited by sections 130, 131, and
136 of our Crim inal Code, m ay be asserted as against a holder m due
course. 5. T he fact th a t a depositor m akes his note payable a t a
bank does n ot authorize the bank to pay it out of his funds on deposit.
6. An alteration of an instrum ent avoids it only when it is m aterial or
fraudulent, and m ade by th e holder. 7. A promise in writing to accept
a bill m ade either before or after it is drawn is deemed an actual accept­
ance as to th e person receiving th e bill on the faith thereof. 8. Section
137 of th e Uniform Negotiable Instrum ents Law, providing th a t the
destruction by th e drawee of a bill of exchange left w ith him for accept­
ance, or his refusal to return th e sam e within tw enty-four hours after
delivery to him or w ithin such furth er period as the holder m ight
allow, should be deemed an acceptance of th e bill, is om itted from the
Illinois act.
P a r tn e r s h ip . T he Uniform Partnership^ Act and th e Uniform
Lim ited P artnership Act are in force in Illinois.
P ro b a te L aw . (See Adm inistration of E states.)
R e c o rd in g A cts. In counties having a population of less th an
60,000, th e clerk of th e circuit court is ex officio th e recorder. In
other counties a “ recorder of d eeds” is elected. As to w hat instru­
m ents m ust be recorded, see respective titles.
R e p le v in . T he action lies for personal property wrongfully de­
tained. T he action m ay be brought in any county where the property
is, or where any of th e defendants reside or m ay be found. Before
th e execution of the writ, th e plaintiff, or some one in his behalf,
m ust give th e officer a bond w ith sufficient security (a real estate
owner of th e county is generally required) in double the value of the
property.
S ales. T he Uniform Sales Act has been adopted in Illinois.
S ales in B u lk . Sales of th e m ajor p a rt or all of a stock in trade,
chattels or fixtures not in th e ordinary course of business, are fraudu­
lent and void as to directors unless th e buyer obtains from th e seller
an affidavit giving a list of his creditors w ith addresses and am ounts
due each, and th e buyer, five days before paym ent, gives notice to
each creditor personally or by m ail of the contem plated purchase.
T ax es. All real and personal property in this State, including
moneys, credits, bonds, stocks, investm ents, shares of stoek_ in cor­
porations (see C orporations), and of banks doing business in this State,
Is subject to taxation. Real and personal property is listed w ith the
C ounty Assessor and assessed between April 1st and June 1st as of
April 1st. The taxes are payable on or before M ay 1st of th e ensuing
year; after which tim e penalties are added. T here is an Inheritance
Tax Law, th e rates varying according to th e relationship of th e heir.
devisee, or legatee, an a th e am ount of the legacies, ranging from 2 per
cent in th e cases oi widow an a children, as to legacies exceeding $ 20,000
and not exceeding $50,000, to 30 per cent on large am ounts bequeathed
to persons n ot related to th e deceased exceeding $100.
W a re h o u se R e c e ip ts. T he Uniform W arehouse Receipts Law
Is in force in Illinois.
W ills. E very male over twenty-one, and female over eighteen,
is com petent to m ake a will. I t m ust be signed_ by th e testa to r or
by some person in his presence and by his direction, and attested in
his presence a t his request by a t least two witnesses. T he witnesses
should be disinterested. A devise to a witness is void unless th e will
be otherwise duly attested by two witnesses exclusive of such person.
Where th e subscribing witnesses are dead, secondary evidence of the
execution is admissible. The will is proved, after notice to heirs and
legatees, in th e county (or probate) court, and m ay be contested, in
chancery, within one year after its probate. Wills or authenticated
copies, affecting estate within this S tate, duly proved outside of this
State in accordance w ith th é law of th e S tate where executed, accom­
panied w ith a certificate of th e proper officer of th a t fact, m ay be
recorded here. Wills executed and published out of this S tate m ay
be adm itted 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, w hether or not the will has been first probated in another
sta te or county. T he Uniform Foreign P robate Act is in force m
Illinois. All originals wills, after being filed, m ust rem ain in the office
of th e county (or probate) court. Children m ay be disinherited.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

SYNOPSIS OF

THE LAW S OF INDIANA
RELA TING TO

BANKING AND COMMERCIAL USAGES
Revised by M essrs. P i c k e n s . M o o r e s , D a v id s o n
a n d P ic k e n s , A ttorneys a t Law, Indianapolis.
(See C ard in A ttorneys’ List.)
A c k n o w le d g m e n ts. All conveyances of real estate, except leases
for less th a n three years, m ust be in writing, and acknowledged and
recorded a t once, or th ey will n ot bind th ird parties. W ithin th
S tate acknowledgments m ay be taken before a judge or clerk of e
court of record, justice of th e peace, auditor recorder, notary public,
m em ber of th e general assembly, or m ayor of a city, and in other
states and territories before th e like officers, or a commissioner of
deeds for Indiana. In any foreign country, before a diplomatic or
consular officer of th e U nited States. I f such acknowledgment or
roof is in some other th an th e English language, or is not attested
y such official seal, it m ust be accompanied by th e certificate of an
officer of the U nited States, to th e effect th a t it is duly executed accord­
ing to th e laws of such foreign country, and th a t th e officer has legal
authority to certify to th e proof or acknowledgm ent and th e meaning
of his certificate, if m ade in a foreign language. Wife m ust join in
deeds and m ortgages of husband’s lands in order to carry her in­
choate one-third interest in husband’s lands. N o separate acknowl­
edgm ent of wife necessary in order to convey her inchoate interest
in husband’s lands, although she m ust acknowledge. The certifying
officer should sta te th e date when his commission expires.
A ctio n s. T he distinctions between law and equity are abolished.
T he sta tu te provides b u t one form of action. Pleadings are governed
by code. Non-resident plaintiffs m ust give bond to secure costs.
A d m in is tr a tio n of E s ta te s . E xcept in M arion County; which
has a separate probate court, the circuit court has exclusive probate
jurisdiction. In cases of intestacy letters are granted in following
order. 1. Widow or widower. 2. N ext of kin. 3. Largest resi­
dent creditor. L etters of adm inistration shall be granted in the
county: i. W here intestate was inhabitant a t tim e of death. 2.
Where, not, being inhabitant of th e S tate he leaves assets. Where
an intestate, not being an inhabitant, shall die out of the State,
leaving assets in several counties, letters m ay be granted in any one
of the counties in which such assets m ay be a t tim e of death, and
the adm inistration first lawfully granted shall extend to all of the
estate. L etters cannot issue to a m arried woman without her hus­
band’s consent in writing. Such consent m akes husband jointly liable
with wife. Preference is given to foreign executor of a decedent
not an inhabitant of S tate, if, before letters are granted in this State
it appears th a t proper letters have been granted in another state,
except there be resident creditors, legatees and* heirs entitled to dis­
tribution, who are inhabitants of th e State. N o action shall be
brought against an estate for any claim against th e decedent; but
th e holder thereof, w hether th e claim be due or not, shall file a suc­
cinct and definite statem ent thereof in th e office of th e clerk of the
court, setting forth all credits to which the estate is entitled, and
accompanied by th e affidavits of the claim ant, his agent, or attoniey,
th a t th e claim is ju st and wholly unpaid. I f claim be secured by a
lien, th e lien shall be particularly set forth. The claim m ust be filed
within one year from th e notice of the adm inistrator’s appointment,
or claim ant m ust pay costs; and if not filed a t least thirty days
before th e final settlem ent of th e estate, it shall be barred, except
th a t heirs, devisees and distributees shall be liable to the extent of
the property received by them , to any unpaid creditor who six months
prior to th e final settlem ent was insane, an infant, or out of the
S tate.— suit to be brought w ithin one year of removal of disability,
and if upon claim of non-resident creditor. Within two years of the
settlem ent of th e estate.
A ffidavits m ay be taken before any officer qualified to take acknowl­
edgm ents (see above). D ate of expiration of officer’s commission
m ust be certified by th e officer himself.
A lien s. Resident aliens who have declared their intention to
become citizens, m ay acquire, hold, and enjoy real estate, and may
convey, devise, mortgage, or otherwise encum ber th e same, inuKe
m anner and w ith th e sam e effect as citizens of th is State. Aliens,
w hether resident or not, m ay own real estate not exceeding 320 acres
lands in excess of th a t am ount they m ust convey within five years or
suffer escheat as to such excess.
A rre s t fo r D e b t. D efendant in a civil action m ay be arrested and
held to bail in th e am ount claimed, a t any tim é before judgment, or
affidavit th a t he is about to leave th e S tate, taking w ith him property
subject to execution, w ith in ten t to delay or defraud the piaintin
Bond is required of plaintiff.
A s sig n m e n ts a n d In so lv e n c y . Any debtor m ay make a general
assignm ent of all property in tru st for benefit of all bona fide creditor
T his tru st is adm inistered under th e direction of th e county court.
Dividends are allowed on all claims allowed by th e trustee or court.
D ebtor is not- discharged from his liabilities.
A tta c h m e n t m ay issue against th e property of a . non-resident or
foreign corporation, and against any who m ay have disposed or. or iw
about to dispose of, property, to cheat, hinder or delay creditors, o
against a creditor who conceals himself so th a t summons can not
served upon him. An affidavit is required, and a bond to pay uam
ages if the proceedings be wrongful or oppressive. Creditors
under th e original attachm ent, before final judgm ent, areTCC}1*.
to furnish a like affidavit and bond, and all share p ro .rata in _
proceeds of the attached property. The wages of a resident n .
holder, n ot exceeding one m onth a t any one tim e, are exempt so ions
debtor rem ains in such em ploym ent. I t is a misdemeanor to
claims out of th e S tate to be collected by attachm ent, or 8a r m s n , •
when creditor, debtor, and person owing for earnings m tenaea
be reached are all within th e jurisdiction of the court of this s t
T he collection of claims so sent m ay be enjoined.
B a n k s, P riv a te . Act of 1907 (in effect Dec. ly F 90 %SJregula^g
private banking applies to any one who m ay use th e word _
in his business. C apital m ust be a t least $ 10 ,000 , not more tha
third of which m ay be invested in the bank building. All real
te
m ust be held in nam e of bank. Bank cannot invest in real
except in realizing on doubtful claim. S tatem ent m ust be me
sta te auditor showing copy of articles of partnership' acknow
(one of the partners to be resident of th e state); location,
meg
of capital, n et worth of partners to be double capital paid m,
S3
of officers. List of officers m ust be posted in bank. Two repoi
resources and liabilities are called for each y e a r b y auditor a
lished in local newspaper. Exam ination of bank xnaae _
^
annually by auditor. S tatem ent of property held_in tru st y„n on
mUst be filed in county recorder’s office. Depositors nave
assets. Jurisdiction over all persons interested
BnslireBS
process served on officer in charge. Banks can n o t commenc . ijlisb
until chartered by S tate C harter Board. Banks cahnot „barter
branches w ithout first having obtained a charter from the sta te
board.

g

B A N K IN G A N D C O M M E R C IA L L A W S— IN D IA N A
B an k s, S av in g s. Governed by a general sta tu te which regulates
in m inute detail th e investm ents and conduct of business. Savings
banks m ay purchase, hold, and convey real estate for th e following
purposes, and none other: F or th e location of banking house, real
estate m ortgaged to it in good faith for money loaned, or upon which
it shall have purchased a m ortgage; real estate taken upon Judgments
and decrees on behalf of th e bank, or purchased to prevent loss on
claims held by th e bank.
B a n k s, S ta te . Regulated by a general banking law. The state
departm ent 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 exam ination into all the affairs of the bank, and, in doing
so, to exam ine any of th e officers and agents thereof on oath. The
examiner reports in detail the Condition of th e bank from tim e to
time. The sta te banks m ust m ake not less th an five reports each
year, verified by th e president, or other m anaging agent, which
reports m ust exhibit th e resources and liabilities a t th e close of busi­
ness on an y past day to be by th e auditor specified. T he report so
required m ust be published in a newspaper where th e bank is estab­
lished, or, if th ere is no newspaper in th e place, then in one pub­
lished nearest thereto in the sam e county or an adjoining county.
The auditor m ay require special reports from any bank, whenever
in his judgm ent, it shall be necessary in order to a full knowledge 61
its condition. Any bank failing to m ake such report shall be subject
to a penalty of $100 for each day th a t it delà vs to m ake and transm it
the same. All banks are empowered to execute tru sts and act as
trustees.
On Septem ber 30, 1920 all duties, power and authority formerly
vested in .the auditor of S tate as to banks of all kinds buidling and
loan associations, m ortgage guarantee companies, rural loan and saving
associations, will be lodged in a Banking commissioner appointed by
the Governor and said Commissioner will be a t th e head of th e D ep art­
ment of Banking a separate branch of th e S tate Governm ent. All
laws relating to above nam ed companies rem ain in full force and effect.
Bills o f E x ch an g e a n d P ro m is so ry N o tes. No grace is allowed.
Damages for p ro test on bills upon any person a t any place o ut of
this State, b u t within th e U nited States, 5 per cent on bills drawn
upon any person a t any place w ithout th e U nited States, 10 per cent
The Uniform Negotiable Instrum ent Law has been in force in Indiana
since 1913. (See Negotiable Instrum ents.)
B lue S ky L aw (Enacted 1921). W hoever offers or advertisessecurities for sale m ust file w ith the Secretary of S tate his affidavit
setting forth: addresses of directors, officers, all partners, and all
agents proposing to sell its securities, and th e nature of the interest
of each.
The location of applicant’s principal office and principal office in
the state, general character of applicant’s business, classes of property
to be dealt in and th e purpose of proposed issue. An itemized state- >
ment of th e financial condition w ith balance sheet of assets and liabili­
ties, plan of proposed business, and approxim ate price of securities,
copy of security itself, copy of publicity m atter, statem ent of applicants
income and expenses and fixed charges for past year, am ount of com­
missions to be paid for sale of securities and how, detailed statem ent’
of cash, property, services, patents, and good will and any other con­
sideration for which securities have been or are to be issued in pay­
ment, am ount of prom otion stock set apart.
Copy of articles, of partnership or incorporation and by-laws, copy
of all instrum ents of tru st, certified copy of ch arter and authority to
do business in Indiana and in its own state.
Foreign investm ent companies m ust file w ritten consent to be sued
in Indiana for m atters growing out of th e violation of th e Blue Sky Law
with provisions for service and process on its agent or th e Secretary of
State.
A state securities commissioner is authorized to examine into the
affairs of any concern falling w ithin th e provisions of the law and
suspend th e license to sell securities upon a showing th a t the certificate
holder is insolvent, has violated any provisions of th e law, has been
guilty of dishonesty or fraud, is in bad business repute, or in unsound
condition. Agents m ust secure license from state.
The law extends to domestic as well as foreign investm ent companies,
but exem pts-the following securities: municipal bonds, bonds subject
to regulation by th e Public Service Commission, bonds sold a t judicial
or probate sales, bonds and notes secured by first m ortgage on real
estate where th e entire issue is sold a t one tim e, securities of corpora­
tions regulated by th e U. S. Governm ent, securities listed on responsible
stock exchange approved by th e state, securities issued by corpora­
tions for benevolent purposes, and securities pledged to banks.
The act does not apply to disposal of securities to a corporation, to
the conveyance of real estate, for disposal of one’s own property, for
the owner’s account, when m ade in the course of a single transaction
by the owner, to notes given in the ordinary course of business, for
goods purchased, to commercial paper running less th an twelve
months, under certain conditions, to disposal of properties m ade by
trustee pursuant to law, to pledges in th e ordinary course of business,
to the issuance of securities under th e corporation laws of th e state,
in good faith, for th e sole account of th e issuer, w ithout commission,
at an expense of less th an one per cent of th e purchase, and where
no part of th e issue is in paym ent of patents, service, good will, trad e­
marks, leases, copyrights, process, formulae, or other intangible assets,
or for property located outside th e state, to securities sold by Indiana
corporations or by foreign corporations having seventy-five per cent
°f their assets w ithin th e sta te and authorized before August 1, 1920.
The act regulates rigidly as to advertisem ents and publicity of such
sales and imposes penalties.
C h a tte l M o rtg a g e s. C hattel m ortgage on personal property left
m the hands of th e m ortgagor w ith power to sell m ust stipulate th a t
»he money received by th e sale be applied to the paym ent of the
mortgage debt, an d should be drawn in the form of an absolute bill
or sale, m ust be acknowledged in th e sam e m anner as prescribed for
the acknowledgments of deed, and recorded within ten days from
execution, and in th e county where th e m ortgagor resides. An
assignment of goods, by way of m ortgage, where such goods are not
aenvered to th e m ortgagee, shall not be valid against any other person
tnan the parties thereto, unless such m ortgage shall be acknowledged,
ana recorded w ithin ten days after the execution thereof. W here
aelivery of th e chattels to th e m ortgagee occurs a t the tim e, record
is unnecessary. A mortgagee of household goods can n ot sell m ortgaged property except under a judicial proceeding in the circuit or
superior court. For certain restrictions on th e lending of money
on mortgage of household goods, see th e statutes.
n.Po n v ey an ces' AH conveyances, m ortgages or leases for m ore th an
S,re0 years shall be recorded and tak e priority according to tim e of
mmg as against good faith purchaser, lessee or mortgagee. Lands in
So “tate m ay be taken, held, conveyed, devised, or passed by
an h *
or from an y citizen of the U nited States; or by or from
“ 7, alien (see Aliens) , w ith some provided exceptions as to descent
Lands which m ay have come by descent or purchase to
of an alien, m ay be held, conveyed, devised and passed by
,7 and from her, notw ithstanding th e fact of her residence
"*E? her husband in a foreign sta te or country.
_ “ xcePt bona-fide leases for a term n ot exceeding three years, con¿”7ance of lands, or of any interest therein, m ust be by- deed, subThl
an<* acknowledged by the grantor or by his attorney in fact.
o f « ? 0™* ^eed of a husband and wife is sufficient to pass th e lands
wife. E xcept in cases of mortgages, conveyances in tru st,
«T»Ze/ ances
husband and wife, an d cases of estates vested in
an n ors or trustees, as such, and so held by them in joint tenancy,
tn x£nveyauces and devises of lands, or of any interest therein, m ade
mnn 0 °5 more persons, shall be construed to create estates in comfchat ’
n° t In jo int tenancy, unless it shall be expressed therein
«uat ine grantees or devisees shall hold the sam e in joint tenancy
ofino? tile survivor of them , or it shall manifestly appear from tenor
instrument, th a t it was intended to create an estate in joint tenancy.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1739

A deed of release or quit-claim shah pass all the estate which the
grantor could convey by a deed of bargain and sale. I f it be the
Intention of the grantor to convey any lesser estate it m ust be so
expressed in th e deed. Liability on lineal and collateral w arranties
Is expressly abolished; a covenant or agreem ent 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 w arrants to C. D. (here describe th e premises)
for the sum of (here insert the consideration),’’ or “ A. B. quit-claims
to C. D. (here describe the premises) for th e sum of (here insert th e
consideration),”— the sam e being dated, and duly signed and acknowl­
edged by th e grantor,—shall, in th e one case, be a conveyance in fee
simple to th e grantee, his heirs and assigns, w ith covenant from th e
grantor for himself and his heirs and personal representatives th a t
he is lawfully reized of th e premises, has good right to convey th e
same, and gua' antees the quiet possession thereof, th a t th e same are
free from all incum brances, and th a t he will w arrant and defend th e
title of th e same against all lawful claims; and shall, in th e other
case, be deemed to be a good and sufficient conveyance in quit-claim
to th e grantee, his heirs and assigns. Any m ortgage of lands worded
—“ A. B. m ortgages and w arrants to C. D. (here describe the premises)
to secure the repaym ent of (here recite th e sum for which th e m ortgage
Is granted or th e note or other evidences o f debt, or a description
thereof, sought to be secured, also th e date of the repaym ent”—-the
same being dated and duly signed and acknowledged by the grantor
—is a sufficient m ortgage to th e grantee, his heirs, assigns, executors
and adm inistrators, with w arranty from th e grantor and his legal
representatives of title perfect and unincum bered in the grantor.
When a deed purports to convey absolutely any estate in lands, b u t
Is m ade, or intended to be m ade, defeasible by force of a deed of
defeasance, bond or other instrum ent for th a t purpose, th e original
conveyance shall n ot thereby be defeated or affected as against any
person other th an th e m aker of th e defeasance, or his heirs or devisees,
or persons having actual notice thereof, unless th e instrum ent of
defeasance shall have been recorded, according to law, within ninety
days after the date of said deed. E very conveyance or m ortgage of
lands, or of any interest therein, and every lease for more th an 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 th e county where
such lands are situated. (See Acknowledgments, M arried Women.)
W hen either the husband or wife is of Unsound mind the p arty
with the sound mind can either join in th e guardian’s deed or m ake
his separate deed and the effect would be the sam e as a joint deed of
husband and wife both of whom are of sound mind.
C o rp o ra tio n s . Domestic Corporations. Corporations are created
only under general statutes. This is done by m eans of articles of
association, filed w ith the secretary of state, and th e recorder or clerk
of th e county, as provided by sta tu te. The liability of stockholders
varies according to th e nature of the corporation in question and the
law-under which it was organized. In th e corporations which were
tn existence N ovem ber 1, 1851, and which accepted the term s of th e
act of M arch 6, 1883. stockholders are liable, in case of insolvency,
for *a sum a t least equal to am ount of stock held a t tim e the debt
was contracted. In m ost corporations, stockholders who have paid
for their stock are not liable for debts of th e com pany. However,
there is liability in some cases for labor and services of employes.
Shares of capital stock in a private corporation are subject to attach ­
m ent. Annual reports m ust be filed in June w ith th e Secretary of
State. A new code regulating th e incorporation of companies for
profit has been enacted (1921) which supplants m any existing statu tes
creative since corporations.
Foreign Corporations. Agents of foreign corporations, before
entering upon th e duties of their agency in this State, shall deposit
in th e clerk’s office of the county, where they propose doing business,
the power of attorney, or appointm ent, under which th ey act. They
shall also file a duly authenticated order, resolution or other sufficient
authority of th e board of directors authorizing citizens or residents
of this S tate having a dem and against such corporation arising out
of any transaction in th is S tate w ith such agents to m aintain a
action in respect to th e sam e in any court of this S tate of com petent
jurisdiction, and authorizing service of process on such agent, and
th a t such service shall authorize judgm ent and all other proceedings
against such corporations. By act of 1913, foreign corporations
m ust file w ith auditor of S tate certified copy of vote of directors
consenting to accept service of summons on auditor of S tate as sum ­
m ons on corporation. I f foreign corporation has no agent within
S tate, summons m ay be served on A uditor of S tate, who shall notify
corporation. C ontracts m ade by such agents shall not be enforced
in any court of this S tate until there has been a compliance with
the above provisions. Failure of a foreign corporation to comply
w ith these provisions will not bar—b u t will abate such action. Any
person who shall, directly or indirectly, receive or transm it money
or property to or for such corporation, or m ake any contract, or,
tran sact any business for or on account of any such corporation,
shall be deemed agent. This provision does not apply, however,
to persons acting as agents for a special or tem porary purpose or for
purposes n ot within the ordinary business, nor does it apply to
attorneys a t law. Any person acting as agent of a foreign corpora­
tion, who shall neglect or refuse to comply w ith the foregoing pro­
visions, is liable to a fine in any sum not less th an $50. In 1879 it
was enacted th a t: E very foreign corporation now doing or tran s­
acting, or th a t shall hereafter do or transact, any business in this
State, or acquire any right, title or interest in or lien upon real estate
in this S tate, th a t shall transfer or cause to be transferred from any
court of this S tate to any court of the United States, save by regular
course of appeal after trial in th e S tate courts, any action commenced
by or against such corporation in any court of this S tate by or against
any citizen or resident thereof; or th a t shall commence in any court
of th e U nited States in this S tate, on any contract m ade in this
S tate, or liability accrued therein, any suit or action against any
citizen or resident of the S tate of Indiana, shall thereby forfeit all
right and authority to do or transact business in this StafS, or hold
real property or liens thereon, and all contracts between such cor­
porations and citizens and residents of this S tate m ade after the
passage of this act shall be rendered void, as in favor of such cor­
porations, b u t enforceable by such citizen a t his election. T he pro­
visions of th e foregoing section are m ade conditions upon which
such corporations m ay be authorized to do business, or hold titles to,
or liens on, real estate in th is S tate. By the act of 1901, foreign
corporations are required to designate an agent in this State upon
whom legal process m ay be served; to have an office where proper
books of account m ay be kept. By act of 1907 foreign corporations
desiring admission to sta te m ust m ake verified statem ent to Secre­
ta ry of S tate showing: articles of incorporation, business intended
to pursue, capital stock, proportion of its business carried on in this
State, am ount paid in on capital stock, and answers to other in ter­
rogatories propounded by th e Secretary of S tate, and shall pay a
fee of $25 on first $10,000 of assets used in Indiana, $10 for each
additional $10,000. Annual report m ust be filed in January and fee
of $1 paid. Foreign corporations m ay n ot hold real estate except
such as m ay be necessary for proper carrying on of its legitim ate
business.
C o u rts . Term s and Jurisdiction. The circuit court is the only
court of original general civil jurisdiction in the S tate. I t has full
probate powers, except in M arion County, where there is a separate
probate court. Superior courts have been established in m any
counties. Justice’s jurisdiction, $200. P arty m ay confess judgm ent
before a justice of the peace for $300. When a w ritten obligation for
money binds more than one p arty th e justice of the peace m ay issue
process to constable of any county in the S tate where p a rty resides.
The suprem e court has no original jurisdiction. I t sits a t Indianapolis.
T he appellate court has final jurisdiction in m any cases.
D ays of G race are no longer recognized.

1740

B A N K IN G A N D C O M M E R C IA L L A W S — IN D IA N A

D e p o s itio n s . Depositions m ay be taken anywhere in th e U nited
States w ithout a commission, before any judge, justice of the peace
n o tary public, m ayor, or recorder of a city, clerk of a court of record,
o r commissioner appointed by the court to take depositions. P er­
son taking deposition m ust not be of kin to either p arty or interested
in th e action. W hen taken outside of th e United States they shall
be tak en pursuant to an order of the court, under a commission, with
such reasonable notice of the tim e and place of taking th e sam e as
th e court shall require, and they shall be certified and returned by
th e commissioner In such m anner as the court shall direct. Notice
of th e taking of th e deposition should be served upon th e adverse
p a rty or hi's attorney, specifying th e cause, the court or tribunal of
trial, th e tim e and place of taking, and the nam es of th e witnesses.
Seasonable tim e shall be allowed for th e attorney so served to com­
m unicate w ith the client, and for travel to the place of taking, exclud­
ing th e d ay of service, of the taking and intervening Sundays. The de­
ponent shall be first sworn according to law. He shall then be examined
b y th e p arty producing him, and then by the adverse party, and'then by
th e officer, if he see cause. The deposition shall be w ritten down by the
officer, by th e deponent, or by some disinterested person, in the presence
and under th e direction of th e officer, and after the sam e has been
carefully read shall be subscribed by deponent. T he following facts
shall be stated in a certificate to be annexed by the officer: 1. T hat
th e deponent was sworn according to law. 2. By whom th e depo­
sition was w ritten, and if w ritten by deponent or some disinterested
person, th a t it was w ritten in th e presence and under the direction of
th e officer. 3. W hether th e adverse p a rty attended. 4. The tim e
and place of taking, and the officer shall sign and a tte s t th e certificate,
and se ar 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 of 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
th e officer exercises the duties of his office. The officer taking the
deposition shall seal the sam e in a sufficient envelope and himself,
post, or express, or deliver th e sam e to the clerk, of the court in which
th e action is pending, endorsing on the envelope th e names of the
parties and of the court and of the witnesses whose depositions are
enclosed. Adjournm ents m ay be had from day to day after th e
deposition has been begun, and for longer periods, upon written con­
sent of th e parties, which w ritten consent m ust be attached to the
deposition. A djournm ents should be noted a t the place in the
deposition when they occur. A narrative form may be used. A
witness identifying a w ritten instrum ent should attach it to his
deposition, m aking it a p art of his answer.
D e sc e n t. T he real and personal property of any intestate shall
descend to his or her children equally; and posthum ous children
inherit equally with those born before the d eath of th e ancestor.
Children of deceased children take th e share which would have
descended to th e fath er or m other and grandchildren, and more
rem ote descendants, and other relatives, lineal and collateral, inherit
by th e sam e rule, excepting th a t if th e heirs are all grandchildren
they inherit equally. W here there are no h ens as aforesaid, onehalf of th e estate goes to th e father and m other as joint tenants,, or
to the survivor, and the other half to the brothers and sisters, and
to th e descendants of such as are dead, as ten an ts in common. If
there be neither fath er nor m other, th e brothers and sisters, and
th e other descendants, tak e th e estate as ten an ts in common; or,
per contra, the fath er and m other as joint tenants of the survivor.
Kindred of the half-blood inherit equally with those of the wholeblood in property purchased by th e ancestor; otherwise, as to property
acquired by gift, devise, or descent. Illegitim ate children inherit
from th e m other same as if th ey were legitim ate, and vice versa.
Tenancy by the curtesy and dower are abolished, and 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 w orth over $20,000, one-fifth only
as against creditors, b u t as against other heirs she takes one-third
in fee simple, regardless of value, except where there is b u t 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 m arriage, and none by such
widow. O ther special provisions of the sta tu te are too extensive to
set out. T he estate of a person dying in testate w ithout kindred
capable of Inheriting will escheat to th e S tate for the support of the
common schools.
D ow er. (See M arried Women.)
) E x ecu tio n s m ay issue a t any tim e within ten years after judg­
m ent and are returnable in 180 days. From a court of record m ay
Issue to any county in the S tate. Are a lien on_ personal property
within th e county from th e tim e they are placed in hands of officer.
The liens upon personal property attach in the order in which the
officer receives them , w hen levy is upon real estate the dates of
the judgm ent control the right to participate in the proceeds, and
they m ust be applied according to th eir priority. Personal property
taken in execution m ay be left w ith execution defendant by the
giving to th e officer of a delivery bond w ith sufficient surety; debtor
may, b y giving sufficient freehold sureties, have a stay of execution
on any sum exceeding $100, for six m onths. W here the sum is less
than $100, th e stay is not so long, varying w ith am ount of judgm ent.
Lands' sold under execution m ay be redeem ed within one year by
the owner, mortgagee or person having a lien thereon, the owner
retaining possession during the redem ption year and being liable for
reasonable rents and profits in case of failure to redeem.
E x e m p tio n s . P roperty up to $600 is exem pt in suits on contract
where debtor is a resident householder. Resident householder is
entitled to exemption as well when in tran sit w ith his fam ily and
property as when perm anently settled. The debtor m ust file a sched­
ule of all. of his property, and select th e property claimed, which is
then appraised. C ontract waiving exemption is void. Pension
money in „transit to pensioner is exem pt, b u t when received by him
and invested in other property is no more so than any other property.
One m onth’s wages also exem pt if th e debtor is still employed.
F ra u d . Assignments, in writing or otherwise, of any property
made or suffered w ith in ten t to hinder, or defraud are void as to the
persons defrauded. The question of fraudulent in ten t is a question
of fact.
F rauds— S tatute of. T he following contracts, if enforceable in court,
m ust be in writing and signed by the p arty to be charged: 1. To
charge an executor or adm inistrator, upon any special promise, to
answer dam ages 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 agreem ent
or promise, m ade in consideration of m arriage, 4. Upon any con­
tract for th e sale of; land (except loan not exceeding the term of three
years). 5. Upon any agreem ent not to be performed within one
year from th e m aking thereof. 6. Sale of goods exceeding $50 in
value, unless p a rt paym ent or p a rt delivery be m ade. 7. Upon
any representation m ade concerning th e character, conduct, credit,
ability, trad e or dealings of any other person.
G a r n is h m e n t. (See A ttachm ent.) Garnishm ent is a rem edy in
aid of attachm ent. Upon any personal action arising out of contract
any person m ay be summoned as a garnishee defendant upon an
affidavit th a t official has good reason to believe th a t any person
aam ed has property of the defendant in his possession or under his
control, or th a t he is indebted to th e defendant, or has control or
agency of money, property, credits, or effects; th a t he-has any share
or interest in the stock of any association or corporation, and aU
money or property in th e hands of the garnishee defendant is bound
from th e tim e th e sum m ons is served upon him. Resident house­
holders are entitled to an exem ption of $600 in garnishm ent pro­
ceedings, as in all other cases. Wages of non-residents, to th e am ount


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

of $25, and of resident householders to th e extent of one m onth’s
wages, are exem pt from execution so long as th e defendant remains
In th e employ or the garnishee. Indiana claims can n o t legally be
sent or taken out of th e S tate for prosecution, and suits instituted
elsewhere in violation of this prohibition m ay be enjoined and the
offender be crim inally prosecuted.
H o lid ay s. (See Legal Holidays.)
H u s b a n d a n d W ife. (See M arried Women.)
I n h e r ita n c e T ax . (See Taxes.)
I n te r e s t. T he legal rate Is 6 per cent, b u t interest m ay be taken
In advance. N o agreem ent 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 th an 8 per cent. W hen 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 th e excess m ay be recouped by the debtor whenever
it has been reserved or paid before th e bringing of th e suit. Interest
on judgm ents runs from th e date of the verdict o r finding, at the
rate specified in the original contract, n ot exceeding 6 per cent, and
If no contract has been m ade 6 per cent is allowed.
J u d g m e n ts of courts of record are a lien upon all real estate of
defendant' w ithin the county for te n years. Judgm ent may be
obtained a t th e first term of the court, after process has been served
on debtor ten days prior to the first day thereof. Judgm ent in justice
court becomes a lien on real estate of judgm ent defendant from time
of filing a transcript in office of the clerk of circuit court. A certified
copy of any judgm ent rendered by the circuit court of th e United
States for district of Indiana m ay be filed with th e county clerk.
L egal H o lid ay s 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
day of February; 22d day of F ebruary; 30th day of M ay; first Mon­
day of Septem ber; 12th day of October; and any election day; when
any holiday (other than Sunday) comes on Sunday th e M onday next
succeeding shall be th e legal holiday; Saturday afternoon is a legal
half-holiday in the city of Indianapolis and m ay be m ade so by act
of bankers in other cities of over 35,000 population.
L ie n s. Liens are granted by s ta tu te to attorn ey s; to persons
holding claims against w atercraft on account of supplies furnished or
work done; also for dem ands for dam ages arising o u t of freight con­
tracts. or for willfulness or negligence of th e m aster, owner, or agent,
or o ut 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 food and care bestowed upon th e same, also to blacksm iths; also to
contractors, sub-contractors, mechanics, journeym en, laborers, and all
persons perform ing labor or furnishing m aterial or m achinery for
erecting, laboring, repairing or rem oving 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 th e construction, repair,
or alteration of any article of value; also to th e bailee or keeper of
personal property for any feed or care bestowed by him upon such
property; special lien for storage or repair of m otor vehicles; also to
forwarding and commission m erchants on goods which m ay have
rem ained 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 th an six m onths m ay be sold a t public auction
to pay am ount of lien; also to landlords upon crops. Persons storing,
furnishing supplies or repairing a m otor vehicle or garage owners
have lien on m otor vehicle which can be foreclosed within one year
from failure of owner to pay charges. Judgm ents rendered in any
county in th e S tate are a lien upon th e real estate situated m such
county for a period of ten years from th e rendition thereof, and judg­
m ents rendered in the federal courts are a lien upon any real estate
in th e S tate for th e sam e period. Provision is m ade by statute, how­
ever, for th e filing in th e county where th e real estate is situated of a
transcript of any judgm ent rendered in th e U nited States courts.
The office of th e clerk of th e circuit court in each county contains a
public record known as th e lis pendens record, in which notice of the
filing of com plaints to enforce liens are required to be recorded, and
also in cases where real estate is seized by attachm en t or execution.
Unless so recorded th e bringing suits does n ot operate as a constrUtcive
notice.
L im ita tio n s to S u its . Actions for injury to person and character,
and for sta tu to ry 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 prom issory notes, bills of exchange and other written
contracts for paym ent of money, ten years; actions not limited by
sta tu te, fifteen years; other w ritten contracts, judgm ents of courts or
record and real actions, tw enty years. Revivor: p a rt payment or
new promise in writing. Except in favor of sureties, th e statute or
lim itations does not run against the State.
M a rrie d W o m en control their real and personal property. The
husband is liable for the wife’s debts contracted before marriage to
th e extent of the personal property he m ay receive from her, and no
further, and her lands are liable for such indebtedness. A married
woman m ay devise her separate estate; m ay 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 m
regard to her separate personal estate business, labor, or service, ana
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 for im provem ent of her separate
real estate. She can m ake leases of real estate for term s or three
years or less, and execute m ortgages to secure purchase money, with­
out husband joining. She is bound by covenants of title in convey­
ances of her separate real estate. H er deed conveying her real estate,
her husband not joining, is absolutely void. She m ay sue as a femme
sole for any dam age to her person or character. She is bound ra
like m anner as principal on her official bond. Disability as to surety­
ship has been abolished, therefore, in making loans to married women
it is n ot necessary for her to m ake an affidavit th a t th e 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 am ount of $600. A widow
takes one-third of her deceased husband’s real estate m fee, and tree
from all dem ands of creditors, where th e estate does not exceed *iu,ooq>
one-fourth, if under $20.000. and one-fifth, if above th a t amoum.
She also takes a child’s interest in th e personality where the nurnn
of children does not exceed two, and where there are more tnarnsw .
her interest shall not be less th an one-third of the wnole of persona y
after paym ent of debts, and in all cases takes $500 without accounting,
and m ay occupy the dwelling of forty acres of her husband s land
a year, ren t free. B ut the one-third of her real estate g H M d L »
widow takes in fee, can not, upon her m arrying again, be enecMv J
conveyed or m ortgaged by her, if there be a child or children, o r .
descendants, alive by the previous m arriage. Real estate w
husband and wife hold by title m ade to them as husband ana
i
is held as, an estate by entirety; it cannot be taken for the ae
either; is n ot subject to the lien of a judgm ent against either, ex p
in case of th e d eath of either or upon divorce granted, when the es
Is destroyed and becomes subject to levy and sale; and a mo gas
thereof by them both for a deb t of th e husband has no legal vaiiawy
M o rtg a g e s. (See Conveyances.)
_
N e g o tia b le I n s t r u m e n t s are defined by C hapter 63 of the

B A N K I N G A N D C O M M E R C I A L L A W S — IO W A
of 1913 which is th e Uniform N egotiable Instrum ent Act. Section 1
provides th a t an instrum ent to be negotiable m ust conform to the
following requirem ents:
1. I t m ust be in writing and signed by the m aker or drawer.
2. M ust contain an unconditional promise or order to pay a cer­
tain sum in money.
3. M ust be payable on dem and, or a t a fixed or determ inable
future time.
4. M ust be payable to order or to bearer.
5. W here th e instrum ent is addressed to a drawee, he m ust be
named or otherwise indicated therein with reasonable certainty.
Its negotiability is not affected by a provision which authorizes
th e sale of collateral securities in case th e instrum ent is n ot paid a t
m aturity, or authorizes a confession of judgm ent if the instrum ent
be not paid a t m aturity, or waives the benefit of an y law intended for
the advantage of the obligor, or gives th e holder an election to require
something to be done in lieu of th e paym ent of money.
To charge indorser notice of non-paym ent m ust be given to him at
once, unless waived by him.
Every negotiable instrum ent is payable a t th e tim e fixed therein
without grace. W here day of m aturity falls on Sunday o r'a holiday.
Instrum ent is payable on next succeeding business day. Instrum ents
payable on Saturdays are to be presented for paym ent on next succeed­
ing business day, except th a t dem and instrum ents m ay be presented
for paym ent before noon Saturday when thaten tire day is not a holiday.
In any case n ot provided for in the act the law m erchant governs,
and all laws in conflict are repealed.
Act does n o t apply to negotiable instrum ents m ade and delivered
before April, 1913.
P o w er of A tto rn e y m ust be executed and acknowledged, and (if
for the conveyance of real estate, or to affect real estate) recorded, in
the same m anner th a t deeds are m ade.
P ro b a te L aw . (See Adm inistration of E states.)
P ro te s t. T he sta tu to ry dam ages on such protest are S per cent
on the principal of a bill of exchange, if drawn or negotiated within
this S tate, upon an y person, a t any place out of this State, b u t within
the U nited States, and 10 per cent if upon any person, a t any place
without th e United States.
R eplevin. When any personal property is wrongfully taken or
unlawfully detained, or, if taken on execution or attachm ent, is
claimed by a third party, th e owner or claim ant m ay bring an action
for possession thereof. He m ay claim im m ediate delivery upon
affidavit therefor, whereupon the sheriff takes possession of the
property, and if delivery bond is given on behalf of the defendant
within tw enty-four hours, the property is returned to him. otherwise
the plaintiff m ay give bond and take the property failing to do so
It is returned to th e defendant. The plaintiff has tw enty-four hours
in which to file bond. Justices of the peace have jurisdiction in
replevin suits involving property w orth $200 or less. Procedure is
same before justice of the peace, except th a t th e plaintiff m ust file
bond in all such cases. Replevin m ay also be had w ithout bond, by
allowing defendant to retain possession of property pending suit.
S u its. (See Actions.)
T axes. State, county, township, municipal, school, and road taxes
attach as a lien on real estate on M arch 1st of each year, and penalties
attach on first M onday in M ay in the next year. One-half of all
taxes m ay be paid without penalty, if paid before first M onday of
May: other half, if paid before first M onday of Novem ber provided
that all war taxes charged shall be included in the first installm ent.
Sales of real estate for taxes are held on th e second M onday of Feb­
ruary, and all lands on which taxes are delinquent for tw o years are
offered. Owner has two years in which to redeem, by paying the
amount set forth in the certificate of purchase w ith all subsequent
taxes paid, and 10 to 25 per cent upon th e whole sum, w ith legal Interest
from the date of purchase or paym ent. Lands are sold for one year’s
delinquency, b u t the following year’s tax (not y et delinquent) is
embraced in th e am ount of the sale. An inheritance tax, graduated
to am ount according to the am ount involved, and th e relation of the
beneficiaries to th e decedent, is levied upon all intangible or tangible
proper of resident decedent, and upon tangible proper of non-resident
decedent. Tax applies as well to gifts m ade in anticipation of death,
to take effect a t th a t tim e. Inheritance taxes do not apply to the
transfer of th e estate of any decedent leaving an estate of less than
$25,000, dying or who has died while in the m ilitary or naval forces
of the U nited States during the World W ar or within one year after
the term ination of th e war. (Revision of the tax laws m ade by 1919
Legislature and for fu rth er inform ation reference should be m ade to
the Acts 1919.)
W ills. N uncupative wills, where property of more th an the value
of $100 is bequeathed, are n ot valid, except as to th e personal property
and wages of soldiers and sailors in actual service. A nuncupative
will m ust be reduced to writing within fifteen days after it shall have
been declared and proved by two com petent witnesses who shall have
heard th e testato r request some of those present to bear witness
thereto. No will in writing is valid unless signed in the presence of
two or more witnesses by the testator, or by some one for him in his
presence, w ith his consent, and attested and subscribed by two or
more witnesses a t his request, and in his presence and th a t of each
other. Will m ade before m arriage becomes void on marriage.

S Y N O P S IS OF

THE LAW S OF IOWA
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised b y B. J. C a v a n a b h , A ttorney a t Law, D es Moines.
(See Card in A ttorneys' List.)
Accounts and C laim s of. Statem ents of account, for use in
court or for proof in th e settlem ent of estates of deceased and in
^nardianship m atters, m ust be itemized and verified. A statem ent
or balance.” or “ goods,” or “ m erchandise” is not sufficient.
A ck n o w led g m en ts. All instrum ents affecting real estate, includMortgages, deeds of trust, powers of attorney relating thereto,
ana leases for more than one year, m ust be acknowledged or the
execution thereof proved and the instrum ents m ust be recorded in
tne proper office, as so to affect third parties. The sam e is also
as to bills of sale, absolute or conditional, and chattel m ortgages
relating to personal property. Articlfes of incorporation m ust also be
acknowledged and recorded. T he forms of acknowledgment and
tne officers, within and w ithout th e S tate, before whom such acknowl­
edgments may be m ade are prescribed by sta tu te.
. Actions. The common law forms of pleading are n ot used,
aitnough the common law forms the basis of procedure. Pleading,
c*u anc* Procedure are statutory, and accord, in the main,
witn what is known as the reformed, or code procedure.
A dm inistration o f E s ta te s . Where an executor is not appointed
ny wfii. adm inistration shall be granted: 1. To the spouse of the
deceased. 2. To the next of kin. 3. To creditors. 4. To any other


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1741

person whom the court m ay select. Claims against the estate of a
deceased person are payable in th e following order: 1. D ebts èntitled
to a preference under th e laws of th e U nited States. 2. Public
rates and taxes. 3. Claims filed within six m onths after th e first
publication of th e notice given by the executors or adm inistrators
of their appointm ent. 4. All other debts. 5. Legacies and dis­
trib u tiv e shares. All claims of th e fourth of th e above classes not
filed and allowed, or if filed and notice thereof n ot served within
twelve m onths from th e giving of the notice of appointm ent are
barred, except as to actions against decedent pending in the d istrict
or suprem e court a t th e tim e of his death, or unless peculiar circum­
stances entitle th e claim ant to equitable relief.
A ffidavits. Affidavits m ay be taken before any person authorized
to adm inister oaths in th e sta te where taken. If taken without th e
S tate of Iowa, the official character of the officer adm inistering the
oath should be evidenced in th e sam e way as the official character of
an officer taking depositions. (See Depositions.) Affidavits m ay be
taken within the S tate for any lawful purpose, of one unwilling to
voluntarily m ake an affidavit, by filing a petition with an officer au th o r­
ized to adm inister oaths, who m ay cause the person to come before
him and m ake affidavit. This proceeding is sta tu to ry and m ust con­
form strictly to the sta tu tes of Iowa.
Affidavits for proving accounts and form: S tate o f .........................
C ounty o f ...................ss, I ......... .......... being first duly sworn, on oath
depose and say th a t I am (a m em ber of the firm o f................... and
th a t said firm is) the owner of the account hereto attached, m arked
exhibit A, and m ade a p a rt hereof, th a t th e sam e is correct in all
particulars and th a t the articles named therein were sold and delivered
to sa id ................. .a t th e prices and tim es therein nam ed and agreed
upon, and th a t said articles were reasonably of th e value charged,
and th a t the said account is due and unpaid. T h at there is no lqgal
set off or credit to th e sam e or any p art thereof except as herein stated .
Subscribed and sworn to before me, by th e sa id ................... th is . . . .
day. etc.
A liens. Non-resident aliens or corporations incorporated under
th e laws of any foreign country or corporations organized in this
country, one-half of th e 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 th e non-resident alien widow, heirs, or devisees
of an alien or naturalized citizen m ay hold the sam e for tw enty years,
and if not sold within th a t tim e, escheats to th e S tate. Aliens m ay
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 m ay
alienate or devise the same, b u t this law does not affect personal
property. A lien holder m ay acquire title to the property embraced
in such lien b ut real estate so acquired m ust be sold within ten years
after title is perfected in an alien, otherwise it will escheat to the
S tate.
A rrest. No person can be imprisoned for debt on either mesne
or final process, unless in case of fraud. D ebtors, however, m ay be
ordered to appear before a court of record wherein a judgm ent has
been rendered, and if the debtor is about to leaVe th e S tate, or conceal
himself, he m ay be arrested and compelled to give bond to appear
before the court for exam inatión, and in the m eantim e, n ot dispose
of his property. (See Supplem entary Proceedings.)
A ssig n m e n ts a n d In so lv en cy . General assignments not valid
unless for benefit of all creditors, when assent of creditors is presumed.
The debtor m ust annex to the instrum ent of assignm ent a sworn
inventory and list of creditors ; and such instrum ent m ust be acknowl­
edged and all of the papers recorded like a deed of real estate. The
assignm ent vests in th e assignee title to all property of the debtor.
Assignee m ust give bonds, prepare a verified inventory and valuation.
and notify creditors by mail to file claims within three m onths.
All claims not filed within three m onths after notice published or
within such extended tim e as the court grants, not excéeding nine
m onths, including claims not yet due, can n ot be paid until all claims
filed within said tim e are paid. An assignm ent does not discharge
th e debtor from his debts and liabilities, b u t only entitles creditors
to share equally in his estate. All claims filed m ust be itemized
and sworn to.
A tta c h m e n ts . An attachm ent, auxiliary to th e m ain case, m ay be
sued out upon any one of twelve (12) sta tu to ry grounds for a debt,
which is past due; or upon any one of four (4) sta tu to ry grounds
for a debt on contract, not yet due. A bond m ust be filed for three
tim es the am ount claimed, if the action is founded upon contract,
otherwise, in a sum to be fixed by the court, if the action is not founded
upon contract. Garnishm ents m ay be effected under th e writ of
attachm ent. Special attachm ents are perm itted, to attach specific
personal property, in a few prescribed cases.
B a n k s. T he banks organized under the laws of Iowa are respect­
ively designated as savings banks and state banks.
Savings banks m ust have a minimum capital of from $10,000 to
$50,000, according to the population of the city or town in which
each is located. Each share m ust be of th e par value of $100. The
sta tu to ry provisions m ust be consulted concerning the m anner of
organization, the issuance of and paym ent for capital stock, the
board of directors, quorum , voting by proxy, lim itation of deposits,
and the investm ent thereof, the loaning of funds, th e cash reserve
required, and the dissolution of such banks.
S tate banks m ust have a minimum capital of from $25,000 to
$50,000, according to th e population of the city or town in which
each is located. Each share m ust be of th e par value of $100. The
sta tu to ry provisions m ust be consulted for the particulars above
referred to on the subject of savings banks.
Banks and loan and tru st companies m ay obtain power to act as
executor, adm inistrator, guardian, receiver, assignee, trustee, or in
other fiduciary capacity. National Banks m ay exercise the same
powers when authorized by Act of Congress. Any Iowa S tate or
Savings Bank or T rust Com pany m ay become a m em ber of the
Federal Reserve bank system.
B ills of E x ch an g e. The negotiable instrum ent law recommended
by the interstate commission on uniform ity of law has been enacted
and is now law in Iowa. (For Grace, See D ays of Grace.) A provision
for the paym ent of exchange, in addition to the am ount of principal
and interest, does not render a bill of exchange non-negotiable.
B ills of L a d in g . The uniform Bill of Lading law has been adopted
in Iowa.
B lu e S ky L aw . This law obtains with respect to offering for
sale certain stocks or securities, and all corporations, dealers, brokers
and other parties affected m ust have perm it from Secretary of State,
from whom copy of the law. rules, requirem ents, applications and
report blanks m ay be obtained upon application.
C h a tte l M o rtg ag es. No sale or m ortgage of personal property,
where the vendor or m ortgagor retains actual possession, is valid
against existing creditors or subsequent purchasers without notice,
unless a w ritten instrum ent conveying same, be executed acknowledged
like conveyances of real estate, and filed for reeord with the recorder
of deeds of the county where the holder of the property resides.
No encum brance of personal property which m ay be exem pt from
execution by the head of a fam ily if a resident of the. S tate shall be
of any validity unless the sam e be by written instrum ent and unless
the husband and wife concur in and sign the same joint instrum ent
C o lla te ra l S e c u ritie s. T here are special sta tu to ry provisions
concerning the pledging of corporate stock, as security; and also
upon the subject of sales of collaterals by action in court and judicial
sale. Otherwise the subject is governed by the common law.
C o n d itio n a l S ales. No sale, contract, or lease wherein the
transfer of title or ownership of personal property is m ade to depend
upon any condition, shall be valid against any creditor or purchaser

1742

B A N K I N G A N D C O M M E R C I A L L A W S — IO W A

of th e vendee or lessee in actual possession, obtained in pursuance
thereof, w ithout notice, unless the sam e be in writing, executed
b y th e vendor or lessor, acknowledged and recorded th e sam e as
ch attel mortgages.
C o n v ey an ces. N o particular form is necessary for conveyances
or mortgages. T he nam e of the parties, th e description of th e property,
th e consideration, th e date, signature, and acknowledgment, is all
th a t is necessary; as between th e parties th ey are valid without
being recorded. The wife m ust join w ith her husband in conveyances,
and a conveyance of th e hom estead is of no validity unless husband
and wife concur in and sign th e same joint instrum ent. A corporation
executes conveyances under its corporate seal, except where the
corporation has n ot adopted a seal. Such conveyances m ust be signed
in th e nam e of th e corporation by th e officers authorized so to do,
by th e Articles -of Incorporation, or By-Laws, or by resolution duly
entered of record in the m inutes of th e corporation, and duly acknowl­
edged by such officers, as the act of the corporation.
C o rp o ra tio n s. P riv ate corporations, sole or aggregate, m ay be
formed for any lawful purpose. B ut th ere are special sta tu to ry
provisions which m ust be complied w ith for th e organization and
governm ent of insurance, banking, loan and trust, building and loan,
and railway corporations. In all cases, the articles of incorporation
m ust be acknowledged and recorded, in th e m anner provided by
law, and approved by th e secretary of state. W ith a few exceptions,
an incorporation fee of $25, plus $10 for each thousand dollars of
capital in excess of $10,000 m ust be paid, upon th e organization
or renewal of a private corporation. T he general term of th e life
of a p rivate corporation is tw enty years, renewable for a like term .
Railroads, savings banks, and a few others m ay last fifty years,
also renewable.
^Foreign Corporations are required to pay a sim ilar incorporation
fee before doing business in the State, based, however, upon the
property of th e corporation, w ithin the S tate of Iowa. Foreign public
service corporations, other th an steam railroads, doing business in
Iowa, and holding companies controlling th e stock of such companies,
are m ade subject to m any of th e laws of Iowa affecting sim ilar domestic
corporations.
C o u rts . Term s and Jurisdiction. T he district court has jurisdic­
tion of all actions, civil and equitable, and has crim inal and probate
jurisdiction. Superior courts m ay be established by th e vote of
th e people in any city of 4,000 inhabitants. I t has jurisdiction to
tr y all violations of city ordinances, and the sam e crim inal jurisdiction
as justice of th e peace courts. I t has jurisdiction to try and determ ine
civil an d crim inal appeals and civil w rits of error from justices of
th e peace, situated in the township where the court is located. Has
th e sam e jurisdiction as th e district court to try all suits in law and
equity, except g ran t divorces, alimony, and separate m aintenance,
and it has no probate jurisdiction. T ranscripts from superior and
justice’s courts m ust be filed in district court to create a lien on real
estate, and are th en enforced as judgm ents of th e district court;
justice’s jurisdiction, $100, or, by w ritten consent of parties, $300.
The suprem e court has only appellate jurisdiction and holds sessions
a t D es Moines, Jan u ary to M ay, from M ay to Septem ber (less vaca­
tion), and from Septem ber to December.
M unicipal C ourt m ay be established by th e vote of people in cities
of 5,000 inhabitants. I t has jurisdiction to tr y all violations of city
ordinances, and th e sam e crim inal jurisdiction as Justice of th e Peace
court. I t has concurrent jurisdiction with the D istrict court in all
civil m atters involving $1,000 or less, b u t has no jurisdiction to g rant
divorces, alim ony or separate m aintenance, and has no p robate juris­
diction. T ranscripts m ust be filed in D ist. C ourt to create a lien,
an d appeals are taken direct to th e Suprem e Court.
D ays o f G race. E very negotiable instrum ent is payable a t th e
tim e fixed therein w ithout grace.
D e p o sitio n s m ay be tak en within th e S tate, on notice, and within
or w ithout the State, on commission, issued after notice by the clerk
of th e proper court. W hen to be tak en on commission, defendant
m ay elect, in writing, duly served, to cross examine orally; thereupon
plaintiff m ay also elect in -writing to examine orally. Exceptions
m ust be filed w ithin three (3) days, after th e filing of th e deposition,
b u t objections m ay nevertheless be m ade on th e trial for com petency,
m ateriality, and relevancy.
D e s c e n t a n d D is tr ib u tio n of P ro p e rty . Subject to rights of
dower and other charges thereon, and burdens imposed during th e
lifetim e of th e decedent, and in th e absence of a valid will, th e estate
of one deceased shall descend in equal shares to his children. The
heirs of any deceased child shall inherit in sam e m anner as though
such child had outlived his parents. If the in testate leave no issue
th e whole of th e estate to the extent of $7,500 after paym ent of debts
and adm inistration expense, and one-half of th e estate in excess of
said $7,500 goes to th e surviving spouse and th e o ther half to th e
parents. I f no surviving spouse, th e whole thereof shall go to his
parents or th e survivor of them ; and so on through ascending an­
cestors and th e ir issue, if both parents be dead. Personal property
not necessary to pay debts is distributed to th e sam e persons, and in
th e sam e proportions as though it were real estate.
D ow er. Dower in Iowa is abolished, b u t th e surviving spouse
is entitled to one-third in value of all th e legal and equitable estates
in real property possessed by th e deceased spouse a t any tim e during
th e m arriage, which have n ot been sold on execution or any other
judicial sale, and to which such survivor has m ade no relinquishm ent
of right. A spouse, heir or devisee feloniously taking or procuring the
taking of th e life of the other spouse, or decedent, cannot have dower
or inherit power or tak e under the will of the decedent. (See Lim i­
tations.)
tE m p lo y e rs L ia b ility . Em ployers liability and workm en’s com­
pensation is governed by sta tu te.
E x e c u tio n s m ay be stayed, according to their am ount, for ninety
days or six m onths, w ith a few specified exceptions, and th e issuance of
execution m ay be prevented b y filing an appeal bond. Otherwise
execution m ay issue immediately^ after rendition of judgm ent. The
judgm ent is a lien on realty w ithin th e county where rendered, or by
transcript, it m ay be m ade a lien in any other county. Executions
become iiens on personal property only from th e tim e of th e levy and
seizure. Real estate is sold on execution subject to redem ption within
one year, except in appealed cases, or where th e interest is a leasehold
of two years or less. C reditors m ay redeem from th e sale after six
m onths and before nine m onths from date of sale. Personal property
Is sold w ithout redem ption.
E x e m p tio n s . T he head of a fam ily is entitled to a hom estead of
forty ftcres or less of farm land, or half an acre or less in city or town.
Pension m oney, its proceeds, wages of th e head of a fam ily for 90
days past, and num erous item s of personal property are exem pt by
sta tu te. T here are sta tu to ry provisions concerning th e creation of
liens on exem pt real or personal property, and th e assignm ent of
exem pt wages. As to alim ony there is no exem ption unless the
p arty in whose favor rendered rem arries.
F r a u d . In actions for fraud, heretofore solely cognizable in a court
of chancery, th e cause of action shall not be deem ed to have accrued
Until th e fraud complained of shall have been discovered by the p arty
aggrieved b y th e exercise of due diligence. In actions brought by a
judgm ent creditor to set aside a fraudulent conveyance of property
from one spouse to th e o ther and to subject said property to execution,
eith er husband or wife m ay be compelled to testify against th e other.
Gross fraud is punishable by fine of im prisonm ent.
G a r n is h m e n ts . (See A ttachm ents.)
H u s b a n d a n d W ife. (See M arried Women.)


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

H o lid ay s. T he first day of th e week, January 1, February 12,
February 22, M ay 30. July 4, th e first M onday in September, Decem­
ber 25, th e day of general election and any day appointed or recom­
m ended by th e governor of this S tate or th e President of the United
States as a day of fasting or thanksgiving are holidays, for all purposes
relating to the presentation for paym ent or acceptance, and for the pro­
testing and giving notice of th e dishonor of bills of exchange, drafts,
bank checks, orders and prom issory notes.
I n t e r e s t . By w ritten contract, maximum legal rate, 8 per cent.
Judgm ents draw 6 per cent, or such rate as is fixed by th e contract
on which th e judgm ent or decree is rendered, not exceeding 8 per
cent per annum . Open accounts draw 6 per cent after six months
from date of last item ; money loaned, money due, money due on
settlem ent of accounts, bear interest a t 6 per cent per annum . Con­
tra c t for more th an 8 per cent forfeits all interest and costs.
J u d g m e n ts in th e district and superior courts m ay be obtained
a t first term after su it commenced, if undefended; an equitable
action, except one for foreclosure of m ortgage, or mechanic’s lien
or for divorce, is triable a t the second term after th e case is a t issue.
Judgm ents of th e district court are liens on real estate owned by
th e debtor a t th e tim e of rendition, if th e lands lie in any other
county, from the tim e of filing therein an attested copy of the judg­
m ent. Lien also covers all lands which defendant m ay acquire
within ten years from date of judgm ent, or upon which a levy is
m ade after ten or before tw enty years from th e date of th e judgment,
b u t this lien dates only from th e tim e of th e levy. Judgm ents of
superior courts and justice of peace courts become liens on real estate
by filing transcript in district court w ithin county where obtained,
and become liens in other counties in th e same m anner as if rendered
in th e district court.
L ie n s. These are m ainly created by sta tu te and are enforceable
in equity. In a few cases, and under peculiar circum stances, equitable
liens on real estate are established and enforced in equity.
L im ita tio n s . Actions, according to their subject m atter, have
various periods of lim itation, fixed by sta tu te, extending from three
m onths to ten years after the cause of action accrued. Actions upon
judgm ents rendered in courts of record have a lim itation of twenty
years. Dower rights and m ortgages existing or created prior to
January 1, 1885, are barred, unless now properly preserved in the
recorder’s office. Im perfect deeds by executors, administrators,,
trustees, or guardians m ade prior to Ja n u ary 1, 1885, are confirmed
in favor of grantees in possession.
M a rrie d W o m en m ay own in their own right, real and personal
property, and m ay manage, sell, convey, and devise th e same by
will. N either husband nor wife is liable for th e debts or liabilities
of th e other incurred before or after m arriage, nor are the wages,
earnings, or property of either liable for the separate debts of the,
other. C ontracts m ay be m ade by a wife, liabilities incurred, ana
enforced by or against her, as if unm arried. B oth husband and
wife are liable for th e expenses of the fam ily, and th e education
of th e children.
M o rtg a g e s m ust be subscribed and acknowledged by the parties
creating the lien and recorded sam e as deeds are foreclosed by equitable
action. T he wife should join in th e instrum ent, except mortgages
for purchase m oney, and m ortgages upon non-exem pt personal
property. T he m ortgagor has one year in which to redeem real
estate after execution sale, except as stated under th e sub-title “ Execu­
tions,” W hen a m ortgage is paid off, satisfaction thereof must be
m ade on margin of th e record, or by satisfaction piece, acknowledged
and recorded. If no satisfaction is entered w ithin th irty days after
request in writing, th e m ortgagee forfeits $25. (See C h attel Mortgages.)
(See Lim itations.)
N o n -re s id e n ts . Action m ay be brought against non-residents to
enforce liens on any property within the sta te ; to enforce any debt
against a non-resident where action is aided by attachm ent on prop­
e rty found w ithin th e S tate. Personal judgm ent cannot in any case
be rendered against defendants, n ot appearing, unless personal
service is had on such defendants within the S tate. Non-residents
m ay n ot sell a t auction unless reciprocal legislation exists in the state
of their residence.
N o ta rie s. These officers are appointed and commissioned by the
governor, upon filing a bond and paying th e fee required by law.
T hey have power to adm inister oaths, tak e depositions, and the
usual power of such officers concerning presentation, demand, protest,
and notice of protest of negotiable commercial paper.
P a r tn e rs h ip s , L im ite d a n d S p ecial. Lim ited and special part­
nerships are perm itted, b u t n ot favored. The sta tu tes on this subject
m ust be strictly compiled w ith. A certificate showing prescribed
details and particulars of th e partnership m ust be signed, acknowl­
edged, and filed in the office of th e clerk of th e d istrict court of the
county in which th e principal place of business is situated, to be
there recorded and sim ilarly recorded in each county where sum
partnership has a place of business. T here m ust be an affidavit
th a t th e am ount stated in th e certificate has been actually contributed
by each separate partner. Publication ipust be m ade of th e ce-tiflcate
and affidavit for six weeks in two newspapers in each senatorial
district in which the partnership is to tran sact business.
P ow ers of A tto rn e y . A power of attorney to convey, or in any
m anner affect real estate, m ust be acknowledged and recorded. A
revocation of such power m ust be acknowledged and recorded in the
sam e office wherein th e original power of attorney is recorded.
R eceiv ers. In distributing property in th e hands of a receiver
there shall be paid in th e following order: 1. Taxes or debts due
th e U nited States. 2. Taxes or debts due th e State. 3. Debtsowing
to employes for labor, n ot exceeding $100,
R e co rd s. All instrum ents conveying or creating liens upon the
real or personal property, all conditional sales and articles of adoption
of a m inor child, m ust, after having been signed and acknowledged,
be recorded in th e office of th e recorder of deeds in th e proper county
or counties where th e property conveyed is situated, or the minor
child is. Unless so recorded, such instrum ents are invalid as to a
bona fide purchaser or encum brancer or as articles of adoption.
R e d e m p tio n . Redem ption from a sheriff’s sale of real estate,
w hether sold under a general or special execution, m ay be made:
by a creditor who has a lien on the property sold, a t tim e after six.
m onths from date of sale by paying to th e clerk of th e court the
am ount provided by sta tu te, being generally, th e am ount of the
purchaser’s bid, w ith interest a t th e sam e rate th a t the judgment
bears. W ithin the tim e nam ed creditors m ay redeem from each,
other. A fter nine m onths, and within one year from th e date of sale
th e owner of th e real estate sold has th e exclusive rig h t to redeem from,
such sale, and, in so doing, the debtor m ust pay off th e claims or
judgm ent creditors, who have m ade redem ptions as herein above
stated, in addition to th e am ount originally bid.
R e p le v in . In actions for the, recovery of personal property, thepetition m ust be verified; and i f plaintiff desires im m ediate delivery
of th e property, he shall execute a bond for double the value of tne
p roperty sought to be recovered. T he defendant m ay stay all proceedings and retain th e property by executing a bond to the plaintur
w ith sureties to be approved by th e clerk.
S ales. T his State has a uniform sales law.
S ales of G oods in B u lk . Sales, including exchange Mid assign­
m ents, of the whole or m ajor p a rt of a stock of goods, or fixtures, or
stock of goods and fixtures, in bulk, is presum ptively fraudulent,
unless seven days’ notice in writing is previously sent by registered
mail to each creditor of th e seller, describing in general .terms, tne
property to be sold, assigned or delivered, and th e parties thereto.
Both parties m ust, seven days prior to th e sale or transfer maim »
detailed inventory; showing q u an tity and cost of price to seller a««,
th e la tte r m ust furnish under oath a list of his creditors and the amountdue each.
.

B A N K IN G A N D C O M M E R C IA L L A W S — K A N S A S
S e cu rity fo r C o sts. Non-resident plaintiffs m ay, on m otion of
defendant, be required to file a bond w ith sureties to be approved for
security of costs eith er in justice court or district court.
S ta tu te o f F ra u d s . No evidence except in w riting and signed
by the p arty to be, charged or by his authorized agent, is com petent
relative to th e following contracts: 1. In relation to sale of personal
property, when no p a rt of th e property is delivered and no p a rt of
the price is paid. 2. In consideration of m arriage. 3. Wherein
one promises to answer for th e debt, d efau lt-.r miscarriage of another,
including promises by executors to pay th e deLt of decedent from their
own estate. 4. For th e creation or tran sfer 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 m aking thereof.
Stocks a n d B o n d s. The sale of stocks and bonds is governed by
what is term ed a "B lu e Sky Law.”
S u p p le m e n ta ry P ro c e e d in g s. W hen an execution has been
returned unsatisfied, plaintiff m ay have an order for the appearance
and exam ination of th e judgm ent debtor: or such order m ay be
obtained after execution has issued upon proof by plaintiff’s affidavit
or other proof th a t debtor has property which he unjustly refuses to
apply to th e satisfaction of the judgm ent. If any property be found
by such exam ination it m ay be levied upon; if in the hands of others
the court m ay require its delivery to satisfy the judgm ent, and
appoint a receiver of debtors property, forbid th e sale thereof and
order E quitable interests in realty to be sold.
Taxes. Beal estate is assessed every odd year; personal property
is assessed every year. All property Is assessed a t its actual value,
and taxed a t twenty-five (25) per cent of th e assessed value. All
road taxes and one-half of the other taxes levied are payable w ithout
interest or penalty before April 1st; the balance is payable
before October 1st. D elinquent taxes bear interest a t the rate of
1 per cent p er m onth. Taxes upon realty are liens thereon; taxes
upon personalty are liens upon th e owner’s realty, except th e home­
stead, and m ay be»-continued as such liens, if th e sta tu te is complied
with, from year to year. Taxes on personalty are liens on the personal
property of non-residents, stocks of goods sold in bulk, and buildings
or additions m ade after th e assessment for taxation in the odd years.
Personal property m ay be levied on and sold for taxes by distress
and sale. Beal estate is sold for uupaid taxes, after notice by publica­
tion, on th e first M onday in December of each year, subject to redem p­
tion in three years from th e date of sale.
T ru st C o m p a n ie s . Dom estic tru st companies are organized under
and governed by th e general corporation laws of the S tate. Foreign
trust companies doing business in this S tate are governed and con­
trolled by th e general sta tu tes concerning and relating to foreign
corporations doing business in Iowa. (See Corporations.)
T ru st D eeds. T hey m ust be executed and foreclosed, and consid­
ered as mortgages. T h at is, th e power of sale on notice is abolished,
and they m ust be foreclosed by equitable action.
W arehouse R e c e ip ts. Any person, firm, or corporation desiring
to issue elevator or warehouse certificates (or receipts m ust file a
written declaration w ith the recorder of deeds in th e county where
his or its elevator or warehouse is situated, setting forth th e particu­
lars required by sta tu te, which declaration m ust be recorded by the
recorder of deeds. T hereafter he or it m ay issue certificates for
commodities actually in such elevator or warehouse, b u t th e certifi­
cates m ust conform to the sta tu to ry provisions. A register of
certificates issued m ust be kep t by th e parties issuing them . A
violation of these provisions, issuing double certificates for th e same
property, or selling or encum bering property included in any ware­
house receipt, is m ade a crim inal offense. T here is also a criminal
statute against issuing false warehouse receipts or certificates.
Wills. Any person of full age and sound mind m ay dispose of
Us property b y will, subject to the rights of hom estead and exemp­
tion created by law and the distributive share in his estate given
by law to th e surviving spouse, except sufficient to pay his debts
and expenses of adm inistration. Wills, to be valid, m ust be w ritten,
witnessed by two com petent witnesses, signed by th e 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 w ith the laws of th e S tate where executed or
of the testa to r’s domicile, if in writing and subscribed by th e testa to r
are valid in Iowa. If probated in any other sta te or country they
shall be adm itted to probate in this S tate on th e production of a copy
of such will, and of th e original record of probate thereof, authenticated
by the attestatio n of th e clerk of th e court in which such proba­
tion was m ade or of th e probate judge, under seal, if th ey have one.
All wills m ust be probated before they can be effectual.

S Y N O P S IS OF

THE LAW S OF KANSAS
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised b y M c C l in t o c k , Q u a n t & L o g a n ,
A ttorneys a t Law, T opeka.
(See C ard in A ttom eysf List.)
A cknow ledgm ents. (See Deeds.)
„A ctio n s. Civil actions are conducted as required by a code of
procedure. Security for costs m ust be given or resident plaintiffs
?eP°sit $15 in lieu of bonds for cost. Non-resident plaintiffs
may be required to give bond for costs.
i n s p i r a t i o n o f E s ta te s . P robate courts in each county have
thl t n
. of estates. D em ands against the estate are divided into
MB following classes: 1. Funeral expenses. 2. Expenses of the
‘t t siGkness: wages of servants; dem ands for medicines and medical
1
during th e last sickness and expense of adm inistration,
dnci1»6 ^ due th e S tate, 4. Judgm ents rendered against the
BBfot ed
M® lifetim e; b u t if such judgm ents are liens upon real
state and th e estate be insolvent, such judgm ents shall be paid
„‘„„out reference to classification, except th e first two which have
bn io elice’ ,5: A11 dem ands w ithout regard to quality which shall
exhibited against the estate in one year after granting
endnf
adm inistration. 6. All dem ands thus exhibited after the
twn „ one year and within two years. Dem ands not exhibited within
o years are barred, except as to infants, persons of unsound mind
haJiersons imprisoned or absent from the United States, who shall
pp.Ti one year after th e rem oval of their disabilities. Foreign exesiatJ8-’
adm inistrators with the will annexed, m ay sell real
will 1? "m® S tate in accordance with the power contained in the
S ta tn .less. ad:ministration upon th e estate has been granted in this
cnnw ’ Provmed th a t a t th e tim e of such conveyance an authenticated
intL,0;. sucr T 1“ bas been recorded in th e office of th e probate court
the county m which th e land is situated.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1743

A ffidavits. Affidavits m ay be m ade in or out of the S tate by the
sam e authority and w ith like authentication, as depositions.
A liens. Law prohibiting aliens from Inheriting or holding real
estate, repealed 1901. (See Foreign Corporations.)
A r b itra tio n s . Persons having controversies m ay subm it them to
the arbitration of any person or persons m utually agreed Upon and
m ay m ake such submission a rule of any court of record in the State.
The parties m ay en ter into arbitration bonds conditioned for th e
faithful perform ance of th e award.
A rre s t. A defendant m ay be arrested in a civil action upon filing
an affidavit w ith th e clerk of th e court th a t he has rem oved or begun
to remove his property p u t of th e jurisdiction of th e 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.
A s sig n m e n ts a n d In so lv e n c y . Assignments m ust be for the
benefit of all creditors and only discharge th e debtor to th e am ount
of paym ents made.
A tta c h m e n t. A t or after the commencement of an action an
attachm ent m ay be had by plaintiff. T he affidavit of the plaintiff
his agent, or attorney m ust be filed, stating th e nature of th e claim,
th a t it is just, the am ount affiant believes ought to be recovered,
and the existence of some one or more of the following grounds: 1.
T h at defendant is a foreign corporation or a non-resident of the State
(but m th is case for no other claim th an a dem and arising upon con­
tract, judgm ent, or decree, unless th e cause of action arose wholly
within the lim its of th e State). 2. T h a t the defendant absconded
w ith the intention to defraud his creditors. 3. T h at the defendant
nas left the county of his residence to avoid a service of summons.
4 . T h at he so concealed^ himself th a t su m m o n s can n ot be served
upon him . 5. T h at he is about to remove his property or a p art
thereof out of th e jurisdiction of th e court w ith the intent to defraud
his creditors. 6. T h at he is about to convert)his property or a
p a rt thereof into money for the purpose of placing it beyond the
reach of his creditors. 6. H e has property or rights in action which
he conceals. 8. Has assigned, removed, or disposed of, or is about
to dispose of his property, or a p a rt thereof, with th e intent to defraud,
hinder, or delay his creditors. 9. Or fraudulently contracted Qr
incurred th e deb t on which th e suit is brought. 10. Or th a t the
suit is brought for dam ages from the commission of some felony or
misdemeanor. 11. Or th a t 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 th e am ount of plaintiff’s claim is
required except where by th e a ttach m en t affidavit defendant is shown
to be a non-resident of th e State.
B a n k s a n d B a n k in g . T here is no constitutional provision relat­
ing to banks, except banks of issue. O ther banks are organized
under a general act. T he charter, in addition to the requirem ents
of th è law relating to corporations, shall contain the nam es and
places of residence of the stockholders and the am ount of stock sub­
scribed by each, and m ay contain such other provisions, not incon­
sistent w ith law, as th e stockholders m ay deem proper, and shall
be subscribed by a t least five of th e stockholders of the proposed
bank who are residents of the S tate of Kansas. Board of directors
shall be n ot less th an five, nor more th an thirteen, a m ajority of whom
shall be residents of th e county or adjoining counties to th a t in
which the bank is located. The word “ S ta te ” shall be included in the
title. The full am ount of th e capital stock m ust be subscribed before
th e charter is filed. T he bank shall tran sact no business, except the
election of officers, th e taking and approving Of th eir official bonds,
and th e receipts of paym ents on account of subscriptions to its capital
stock, until it has been authorized by th e bank commissioner to
commence business. T he capital stock m ust be paid, in full, in cash
and shall not. be less th an $10,000. No bank shall employ its money
directly or indirectly in trad e or commerce by buying and selling
goods, chattels, wares, and m erchandise, and shall n ot invest in the
stock of any bank or corporation, nor m ake any loans on th e security
of th e shares of its own capital, nor be th e purchaser or holder of
any such shares, except to prevent loss upon a d eb t previously con­
tracted in good faith. All such property coming into th e possession
or th e bank in th e collection of debts shall not be considered assets
after th e expiration of six m onths. Banks m ust have on hand in
available funds the following sums: In cities having less th an 5,000
population, 20 per cent of their deposits; in cities having over 5,000
population, 25 per cent, one-half of which m ay consist of balances
due from good solvent banks located a t commercial centers and a t
such other points as the bank commissioner m ay approve. The
other half shall consist of actual cash. Officers are personally liable
for paying overdrafts. N ot more than 15 per cent of th e capital
stock and surplus can be loaned to any one person, com pany or
corporation. P enalties are provided for false statem ents and for
receiving deposits when th e bank is in a failing condition. P rivate
banks are subject to the provisions of th e law. T he bank commissioner
or deputy, m ust m ake exam ination of each bank a t least once a year.
Four reports per annum are required, and th e commissioner m ay caB
for others. Banks m ay purchase, hold, and convey real estate under
certain conditions to th e extent of one th ird of their capital and
surplus. Shareholders are additionally liable for a sum equal to the
par value of stock owned and' no more.
Deposit G uaranty Fund. Any bank having an unim paired surplus
equal to 10 per cent of its capital, m ay participate in th e guaranty
fund act. Such bank m ust deposit w ith the sta te treasurer money
or bonds, of .the United States, S tate of Kansas, or of an y township,
school district, board of education or city w ithin th e State, to the
am ount of $500 for each $100,000 of its average deposits eligible to
guaranty (less its capital and surplus). I t shall also p ay in cash an
am ount equal to one-twentieth of one per cent of its average deposits
eligible to guaranty (less its capital and surplus).
In Jan u ary of each year th e commissioner shall m ake assessments
or one-tw entieth of one per cent of th e average guaranteed deposits
or each bank_ until th e cash fund accum ulated am ounts to $500,000.
T he commissioner m ay m ake additional assessments of the same size
n ot more th an five in any one year. I f a bank fails, the bank commis­
sioner takes charge and winds up its affairs. H e issues to each
depositor a certificate bearing 6 per cent interest. Any balance due
after .assets are exhausted is payable out of th e guaranty fund.
Deposits otherwise secured do n ot participate, nor a bank’s obligation
as indorser upon bills re-discounted, n ot bills payable, nor money
borrowed from its correspondents òr others.
Banks are prohibited from advertising th a t deposits are guaran­
teed by th e S tate b u t are perm itted to advertise th a t deposits are
guaranteed by the Bank Depositors’ G uaranty Fund.
B ills of E x ch an g e. (See N otes and Bills of Exchange.)
B ills of L a d in g . These are governed by th e common law.
B u lk S ale. “ The sale or disposal of any p a rt or th e whole of a
stock | of m erchandise or th e fixtures pertaining thereto, otherwise
than in th e ordinary course of his trad e or business, shall be void as
against the creditors of the seller, unless the purchaser receives from
the seller a list of the nam es and addresses of th e creditors of th e
seller certified by th e seller under oath to be a com plete and accurate
list of his creditors and unless th e purchaser shall, a t least seven days
before taking possession of th e property, or before paying therefor,
notify in person or by registered mail, every creditor whose nam e
and address is stated in said list, or of whom he has knowledge, of
th e proposed sale.”
In lieu of notice m ay give bond twice am ount debts "shown by
sellers affidavit signed by two resident sureties, who justly for prop­
erty in excess of the obligation of the bond th e bond to be approved
by and filed w ith th e clerk of th e district court of th e county where
the property sold is located.

1744

B A N K IN G A N D C O M M E R C IA L L A W S— K A N S A S

C h a tte l M o rtg a g e s. A m ortgage of personal property, where the
property is not im m ediately delivered to the mortgageej who retains
actual and continuous possession thereof, is void as against creditors
of th e m ortgagor and as against subsequent purchasers and m ortgages
In good faith, unless th e m ortgage, or a copy thereof is filed in th e office
of th e register of deeds in th e county where th e property is situated,
or if th e m ortgagor is a resident of th e state, then of th e county of
which he is a t th e tim e a resident. A m ortgage so filed is invalid
after tw o years unless w ithin th irty days next preceding the expiration
of such tw o years and each two years thereafter th e mortgagee, his
agent or attorney, m akes an affidavit exhibiting the interest of the
mortgagee in the property and showing th e balance unpaid on the
deb t and files th e same in th e same m anner as th e m ortgage, in
case of default th e m ortgagee m ay sell in th e m anner provided in the
chattel^m ortgage.exgm pt personai property is invalid unless executed
jointly by husband and wife where th a t relation exists unless it he
given for th e purchase price of th e m ortgaged chattel.
C o lla te ra ls. Governed by the common law on Bailm ents and
Pledge.
C o n d itio n a l S ales. Conditional contracts, by whieh the owner­
ship rem ains in the p a rty proposing to sell until the purchase price
Is paid are treated as chattel m ortgages and m ust be filed in the
office of th e register of deeds in th e sam e m anner as such chattel
mortgages b u t rem ain in force w ithout th e renewal affidavit required
In ch attel m ortgages.
C o n tr a c ts . All contracts which, by the common law, are joint
only, shall be construed to be joint and several. The use of private
seals in w ritten contracts (except seals of corporation) is abolished,
and in suits upon w ritten contracts, as to th e perform ance of con­
ditions precedent, it is sufficient after setting out th e contract to
allege generally th a t plaintiff has fully perform ed th e contract.
C o n v ey an ces. (See Deeds.)
C o rp o ra tio n s . Corporations are formed under a general statu te.
Prospective corporations m ust apply to the charter board for a charter.
A $25 application fee m ust accom pany an application. C harter tee
is one-tenth of one percent of its authorized capital stock upon the
first $100,000; one-tw entieth of one per cent on all m excess of SlOffiOOO.
Forms for applications and charters furnished by the Secretary of
S tate. E very corporation m ust commence active operations within
one year after filing its charter with the secretary of state; failure to
do so works its dissolution. D uration of charter is fifty years, or less,
as m ay be specified in the charter. No corporation (except railroad,
banking, and building and loan), can commence business until it
file with th e secretary of sta te an affidavit made by its president and
secretary setting forth th a t not less than 20 per cent of its.cap ital
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. T he name adopted
m ust indicate the nature of the business. T he corporate nam e m ust
begin with th e word “ th e ” and end w ith th e word corporation,
“ com pany,” “ association," or “ society, b u t this does n o t , a PP'y
to banks, benevolent or religious societies. T here m ust be a t least
five directors, three of whom m ust bq residents of the State, in e
annual statem ent shall be m ade by each corporation for profit or on
before M arch 31st of each year, showing a complete detailed sta te­
m ent of th e condition of such corporation, on the 31st day of December
next preceding. Failure to file this report within um ety days Ifcom
tim e fixed works a forfeiture of the charter, and a penalty of $5 for
each day the report is delayed. T he capital stock can be increased
to an am ount n ot exceeding three tim es th e original am ount fixed in
the charter and to any further am ount of bona fide paid UP capital.
Capital stock m ay also be decreased. Preferred stock can be issued
if all th e holders of common stock consent. Dividends can not be
declared from any source other th an th a t which results from profits.
The corporation can borrow money n ot to exceed th e am ount or its
capital stock.
C o sts. (See Actions). C orporations (except banks, insurance,
building and loan companies and those not nr^anized for profit) m ust
pay an annual franchise tax on paid-up capital as f°Uows. N ot over
$10,000, $10; over $10,000 and not over $25,000, ®2 5 . over $26,000
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
a n d n ot
over $500,000, $250; over $500,000 and n ot over $ 1 ,000,000, $500,
over $1 000,000 and n ot over $2,000,000, $ 1 ,0 0 0 ; 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.
C o u rts . T erm s and Jurisdiction. D istrict courts, holding two to
three term s a year in every county, have general original jurisdiction
In law and equity. Regular term s of th e probate court are held In
each county on the first M onday in each m onth and special or adjourned
term s m ay be held as business m ay require. Justice s jurisdiction in
civil actions for th e recovery of m oney. $300; to recover specific
personal property n ot valued in excess, $800. The suprem e court is
the court of last resort.
C re d ito rs ' B ills. Creditors m ay bring an action in th e nature of
a creditors’ bill to m arshal assets or set aside fraudulent conveyances
as in o th er states.
D ays of G race. Abolished.
D eeds. N o particular forms of conveyances are prescribed. As
a rule the form used in other States is sufficient. As between
the parties conveyances are valid w ithout being recorded. Deeds
may be valid as against attaching creditors without being recorded.
T he wife should join w ith her husband in th e conveyance, and any
conveyance or m ortgage of the hom estead w ithout ber uniting in the
same is absolutely void. If the wife has never resided in th e State
her signature is not necessary. G rantors 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 m ust be before a
judge or clerk of the district court having a seal, a justice of th e
peace, notary public, county clerk, register of
of an incorporated city. E very notary public shall add to his official
signature the date of the expiration of his commission as notary
public. In cases where the acknowledgm ent is m ade /m t-o f the
S tate it m ust be m ade before a court o fre c o rd , a
officer having the seal thereof, a commissioner of deeds for Kansas,
justice of the peace or notary public, or before a n y c o n s u l o f the
United States resident in any foreign country or port. Deeds axid
mortgage« m ust be recorded in the office of th e register of deeds of
th e county in which th e land is situated, or th ey will be void as tc
subsequent grantees in good faith w ithout notice.
D eed s of T r u s t in th e nature of m ortgages are n ot used so far as
sale by the trustee is concerned. (See T rusts, etc.)
D e p o s itio n s . Depositions are taken upon notice to th e opposite
p arty C ourts are also authorized to appoint commissioners to take
denc&tions. T he depositions m ay be taken before any person author­
ized to take acknowledgments. E ach witness m ust sign his own
deposition The notice m ust be attached to the depositions and
inclosed with them . T he depositions should be commenced on the
day nam ed, and some portion of a deposition taken
sive dav Sundays and national holidays n ot being regarded. If
tak en by interrogatories and cross-interrogatories, under agreement
or otherwise, each interrogatory and cross-interrogatory m ust be
n u t to each witness and answered so far as he can answer it, and the
answer w ritten down. I f th e depositions are taken before th e m ayor
no tary public, or commissioner appointed as afOTesaid, th ey must
be certified under his official seal. If before any officer n o t possessing
a seal a certificate m ust be annexed, under the seal of th e county, or
toe t r e t t S a l o f th b S tate, th a t the officer by whom th e deposition.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

were tak en was. a t toe tim e of taking to e same, such officer as tie
represents himself to be in his certifletae. This should be attached
to th e certificate of the officer (not possessing a seal) who took th*
depositions.
,
D e s c e n t a n d D is tr ib u tio n . T he hom estead is th e absolute
property of the widow and children— one-half in value to the widow
an a th e other half to th e children, when both survive. The home­
stead can n ot be divided or sold by an action for partition until all
th e children a tta in m ajority. One-half of all real estate owned by
husband during coverture, and n ot conveyed by husband and wife,
nor sold a t 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 th e S tate. Remaining real estate
goes to toe surviving children, and living issue of prior deceased
children, children taking per stirpes, in equal shares, or, rf none, the
whole estate goes to to e widow. For w ant of wife or child or hvmg
issue of deceased child the whole estate goes to th e parents, f he rules
applicable to widow of deceased husband apply to husband of deceased
wife. Illegitim ate children inherit from th e m other, and also from
th e father, if his recognition has been general and notorious, or ir
writing. When a child would inherit from either parent, such parent
will inherit from the child. Personal property descends in toe sanw
way as real estate except exem pt household furniture is sole property
of
or surviving spouse. P roperty descending by law or will is subject to
an inheritance tax, varying in percentage according to relationship and
am ount. (See Exemptions.)
D ow er. Dower is abolished by law. (See Descent and Distri­
bution.)
E vidence. (See Testim ony.)
E x ecu tio n s m ay be ordered as soon as judgm ent is obtained if stay
has not been granted or supersedeas given. Executions running to
th e sheriff of the county where the levy is to be m ade, m ay be levied
on property in any county of the S tate and issue only out of court
where judgm ent obtained except where abstract or* transcript of justjc*
judgm ent filed in district court of sam e county as th a t of the justice
court, execution will issue on said judgm ent only out of said district
court. T here is no stay of execution In th e district court except by
supersedeas bond which m ay be given on appeal. In justice s courts,
by filing bond, stays of execution are granted as follows. On ary
judgm ent for $20 and under, th irty days; over $20 and under $50
sixty days; over $50 and n ot exceeding $100, ninety days; over $100.
one hundred and tw enty days. Real estate is only subject to execu­
tion issued out of district court of county wherein judgm ent rendered
or abstract or transcript from justice of toe peace filed. Execution»
are liens on personal property only from tim e of levy. Real estate
sold on execution or order of sale, giving toe debtor eighteen months
in which to redeem. T he debtor is entitled to possession of the
property and rents and profits, during the period provided for redemp­
tion. except in case of w aste. Receiver m ay be appointed to present
waste ana m ay use so m uch of rents and profits as are necessary to
repair waste and pay costs of receivership. Surplus if any to be paid
to judgm ent, debtor free from toe lien of any judgm ent.
E x e m p tio n s . Hom estead of 160 acres of farm ing land, or of on*
acre within an incorporated town or city, with buildings thereon,
appurtenant to the use of th e property as a homestead, unlimited in
value. All household goods and wearing apparel; two cows, ten
hogs, one yoke of oxen, and one horse or mule or in lieu of one yoke
of oxen and one horse or mule, a span of horses or
sheep and their wool; necessary food for th e support of sucH stock for
one year, one wagon, tw o plows, drag, and other farm ing utensils, not
exceeding $300; grain, m eat, vegetables, groceries on hand, etc.,
necessary for the fam ily for one year; the tools and implements of
any mechanic, miner, or other person, k ep t for th e purpose of carry­
ing on his business, and in addition thereto
ing $400 in value; library, implements, and office furniture of any
professional m an necessary for carrying on such trade. Also pereonaJ
earnings of the debtor earned during three m onths Preceding the
garnishm ent or attachm ent, and three m onths pension money, where
such earnings or pension money is necessary for the support of toe
d e b to rs faiffily. b ut 10 per cent of such earnings m ay 6e required
to be paid in and applied on the judgm ent.
. . „oa
F o re ig n C o rp o ra tio n s. A foreign corporation doing business to
this S tate m ust file a certified copy of its charter or
corporation with th e secretary of sta te and pay to the^statei treasurer
the sam e fees upon th e am ount of capital invested or used
sta te as a domestic corporation when it receives a certificate atithor
izing it to do business and is then subject to substantially toe same
provisions, judicial control, re s tric tio n and penalties ^ ¿ domestic
corporation. Annual statem ents m ust be filed on or before Marcs
ol s t divine condition on tJi© 31st of December preceding,
foreign corporation fails to file with th e secretary o f j ta te the state­
m ent required by law within ninety days after to e ifP ? ,P r0A penalty
its right to do business in the S tate is thereby forfeited. A penany
is imposed of $5 for each day this report is delayed. Foreign cor
porations m ust pay an annual franchise tax on th a t portion of ones
capital represented by its property and business in Kansas on^ tne
sam e basis as domestic corporations. Failure
who transact business in Kansas, °to e r than interatate commeree
to comply with this law renders them subject to ouster and receiver
ship proceedings on the p a rt of th e S tate b u t does not now affect toe
right of such foreign corporation to sue in toe courts of this State.
F ra u d . (See A ttachm ents, Arrest, and Assignments.)
G a r n is h m e n t in D is tr ic t C o u rts . A t
.afto r *he time a
beginning an action to recover damages founded upon contrac
judgm ent or decree, or after th e issuance of an execution and bef
it isgrcturned. if to e plaintiff cause to be filed with the clerk an affidavit
stating the am ount of his claim over and above all offsets. ™
believes th a t some person, nam ing him , indebted to, or has prop
in his possession br under his control belonging to to® defendant, a ^
th a t such defendant has no property hable to exeration sumo >
to s a tis fy h is d e b t, a n d t h a t t o e Indebtedness or p rop erty w t e
n ot by law exem pt from seizure or sale upon execution,cn
shall issue a garnishm ent summons. In justace
affiant
differs from th a t acquired in district court actions only in to ant
states th a t plaintiff is in danger of losing his
tinf executioo
allegations th a t the defendant has not property st^ | e9 ,
double
sufficient to satisfy the debt. In the district, courtsbcU ffi“ dou
am ount claimed is required on garnishm ents beforei judgment,
g
where defendant is a non-resident. No bond requirea in t
courts.
G u a r a n ty C o m p a n ie s . (See T ru st Oonipanies.)
n
H o lid ay s. The following are legal holidays:
February
as New Years Day. February 12th, Lincoln s Birthday.
» 4th
22 nd, W ashington’s B irthday. M ay 30th, Memorial Day.
0c.
Independence Day. F irst M onday in September. Labor
per),
tober 12th, Columbus D ay (but does not affect co m m r« a rUmjfey
December 25th, Christm as D ay. I f any of these day
business
the next secular or business day is a legal holiday. Lega*
proceedings had on a holiday, excepts Sundays, are valid.
H u s b a n d a n d W ife. (See M arried Women.)
y
I n j u n c t io n s . Injunctions m ay be granted by a d i s t r i c ^ o ^ in
by the judge thereof a t toe beginning of an ^ j i r e c t the defendant
his discretion. A bond m ust be f iven. t o P ^ ^ L obtained. In
against any loss in case to e injunction t® wrongraliy
may
th e a b s e n c e of th e judge from th e county th e probate juuge
grant tem porary injunctions.
In so lv e n c y . (See Assignments.)
d
I n te r e s t. Legal rate, 6 per cent but 10 Pner„iS ft j0Q thereto there
upon. Excess of 10 per cent is forfeited, and m addition t n ^ ^ lawfU!
shall be deducted from the am ount due for principal.

B A N K IN G A N D C O M M E R C IA L L A W S— K E N T U C K Y
interest, an am ount equal to th e Interest contracted for In excess of
10 per cent. T he legal interest originally contracted for continues
until th e deb t is paid, and no additional interest can be charged by
way of p enalty for default except from date of default. A purchaser
of a negotiable note in due course takes th e note free of th e usurious
taint.
J u d g m e n ts . Judgm ents of courts of record are liens on th e real
estate of th e debtor w ithin th e county from th e first d ay of th e term
it which th e judgm ent was rendered; b u t judgm ents by confession
and judgm ents rendered a t th e sam e term during which th e action
was commenced are liens only from th e d ay on which th e judgm ent
was rendered. Judgm ents lose th eir priority over subsequent judg­
ments unless execution is issued and levied w ithin one year after
Judgment. A certified copy of th e judgm ent appearing of record in
the district court m ay be filed in th e office of th e clerk of th e district
court of any other county and th e judgm ent will th en be a lien on
real estate in th a t county. A bstracts or transcripts of justice court
judgments m ay be filed in th e district court of th e sam e county,
are liens on real estate in such county from th e date of filing, after
which executions issue only o ut of said district court on such judgm ents.
J u r is d ic tio n . (See Courts.)
lic e n s e . Agents of insurance companies are required to tak e out
licenses from th e superintendent of insurance. Cities are authorized
to enact license ordinances and certain classes of business are required
to take o u t a license.
L iens. M echanics, m aterial-m en, and laborers, both original con­
tractors, an d sub-contractors, and laborers of sub-contractors axe
entitled to obtain liens upon real estate for labor perform ed or m aterial
furnished in th e erection or repair of any building. Sworn statem ents
Itemized as fully as practicable as to th e am ount of th e claim, for
what and when it was rendered and by whom, giving nam es of con­
tractor and owner and description of property and date of last m aterial
furnished, m ust be filed in th e office of th e clerk of th e court. Original
contractor’s lien claim m ust be filed w ithin 4 m onths from date of
last materials, or labor furnished and others entitled to lien within
sixty days after last m aterials or labor furnished. Lien claim ants
other th an original contractors, m ust give im m ediate notice of filing
of lien claim to owner or person in possession of th e premises, where
that m ay be done, otherwise m ust post notice on the premises.
Supreme court has rendered notice alm ost unnecessary. Action to
foreclose lien m ust be begun w ithin one year after filing claim. Liverystable keepers, forwarding m erchants and common carriers n av e hens.
(See Judgm ents.) A ttorneys have lien on papers and funds in hand
for general balance of com pensation and have lien on m oneys in hands
clients adversary due client in any m atter, action or proceeding, in
which th e atto rn ey was employed for services therein from th e tim e
of service on th e adverse party, in th e m anner of a summons, of
written notice of th e lien.
>
. .
pfortaimlt.hB, horseshoers, wagon m akers and garage proprietors
given lien for m aterial and labor in th eir work perfected by flung
statement of lien w ithin sixty days after th e services in th e office
of the register of deeds of th e county where performed—foreclosed
In same m anner as ch attel m ortgage.
.
, . L .
Liens sim ilar to ordinary m echanics lien are given by sta tu te for
materials and labor furnished on oil leases in th e ir developm ent,
and are foreclosed in like m anner.
L im ita tio n s o f S u its . An action for th e recovery of real property,
sold on execution o r ■by executors, adm inistrators, or guardians,
brought by th e execution debtor, or th e heirs, ward, or guardians,
within five years after th e deed is recorded. O ther actions for
recovery of real property, within fifteen years. On official bonds
and contracts in writing, five years. C ontracts not*in writing, three
years. Trespass, detinue, replevip, injuries n o t arising on contract,
and relief on th e ground or fraud, two years. Action for libel, slander,
malicious transaction, or false im prisonm ent upon a suit for penalty
or forfeiture, one year. Action for any other relief n o t before
provided for, five years. In any case founded on contract, p a rt
pajrment, or an express w ritten acknowledgement or promise, renews
the contract. T h e sta tu te runs from th e date of such renewal. Con­
tractual lim itations differing from th e sta tu te s are void.
M arried W o m e n . T he real and personal property owned b y a
woman a t th e tim e of h er m arriage, and any property which comes
to her by descent, devise, or bequest, or gift of any person except her
husband, rem ains h er sole and separate property notw ithstanding her
marriage, an d is n o t subject to tn e disposal of her husband or liable
for his debts. M arried women m ay sell and convey their real and
personal p roperty an d en ter into an y contract w ith regard to th e
tame in th e sam e m anner and to th e sam e extent as a m arried m an
may in relation to his property. She m ay sue and be sued In th e
same m anner as if she were single. She m ay carry on any tra d e or
business, perform labor or services for her separate account, and her
earnings or proceeds from labor, trade, o r business rem ain h er separate
property, and m ay be used and invested b y her in her own nam e.
Her husband is n o t liable for her debts incurred in her separate busi­
ness undertakings b y virtu e of th e m arriage relation. She m ay also
contract w ith her husband w ith th e sam e effect as though th e m arried
relation between th em did n o t exist.
M ines a n d M in in g . T he law provides for th e appointm ent of a
mine inspector w ith au th o rity to require m ine owners to provide
certain facilities for th e h ealth and safety of persons employed and
compel proper ventilation, regulate excavations, a ir courses, etc.
This law is quite elaborate and violations of th e safety' provisions of
the act—resulting in inju ry to employees, usually results in liability
even where th e K ansas W orkm en’s Com pensation A ct does not
apply, on th e p a rt of th e m ine operator to th e employees because of
tie positive du ty resting on th e operator to comply w ith such sta tu to ry
provisions.
M o rtg ag es. A m ortgage of real estate, to be valid as against
subsequent bona-fide purchasers w ithout notice, m ust be duly ac­
knowledged an d recorded in th e office of th e register of deeds of the
county where th e land is situated. M ortgages m ay be valid a s against
attaching creditors w ithout recording. M ortgages m ay be discharged
on margin of record b y m ortgagee or attorney or assignee by duly
acknowledged power of atto rney or assignm ent in-presence of register,
or by satisfaction entered on th e instrum ent when copied on the
margin by th e reg ister; or by an independent release duly acknowledged
and recorded, w ife m ust join in all m ortgages except those for
purchase money, except in cases where she has never been a resident
of the State. M ortgages axe foreclosed by suit only. By an act
of the Legislature which took effect M ay 18, 1893, real estate sold
under foreclosure of m ortgage is subject to eighteenm onthsredem ption.
If the m ortgage foreclosed is on abandoned property or n ot occupied
in good faith and th e court so finds, six m onths only is allowed for
redemption. T his a c t does n o t apply to m ortgages executed prior
to the d ate th e act took effect. W hen a mortgagee is assigned the
assignment should be acknowledged and recorded. I f th e assignm ent
was executed prior to M arch 1.5, 1899, it can be recorded w hether
acknowledged o r not, and under th e laws m ust be recorded w ithin
four m onths from th a t d ate or paym ent to th e recent owner of the
mortgage w ithout notice of th e outstanding assignm ent, will be a
complete defense to an action thereon. (For Form s, see Deeds;»see
Executions.)
(For M ortgages on C hattels, see C hattel M ortgages: see Execu­
tions.)
N o taries. N otaries are appointed by th e Governor and serve for
four years. T h ey give bond in th e sum of $1,000 and are required
to affix th e d ate of th e expiration of th eir commission to all certifi­
cates.
Notes a n d B ills o f E x c h an g e. Uniform N egotiable Instrum ent
Act took effect Ju n e 8, 1905.
H I

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1745

P a r tn e r s h ip s . Lim ited or special partnerships m ay be formed
for any legal purpose except banking o r insurance. Such partnerships
m ay consist of one o r m ore persons who are general partners, and
one or m ore who contribute a specific am ount of capital and shall
be called special partners. T h e special p artners axe not liable for th e
debts of th e partnership beyond th e am ount contributed by them
respectively b u t th e nam es of th e special partners m ust n ot be used
In connection w ith th e business. Such a partnership is form ed by
executing a certificate stating th e nam e, th e n atu re of th e business,
th e nam es of th e general and special partners, and th eir place of
residence, and th e am ount of capital contributed by each special
partner, and th e period when th e partnership is to commence and
when it will term inate. T he certificate m ust be acknowledged and
filed and recorded in th e office of th e county clerk.
P o w er o f A tto rn e y . (See Deeds.)
P ro b a te L aw . (See Adm inistration.)
P r o te s t. (See N otes and Bills.)
R e co rd s. (See Deeds.)
„
R e d e m p tio n . (See M ortgages.)
R e p le v in . T he plaintiff in an action to recover th e possession of
specific personal property m ay claim th e im m ediate delivery of the
sam e by filing affidavit and giving bond double th e sworn value of
th e property. P roperty replevined m ust be held by th e officer taking
it tw enty-four hours, during which tim e th e p a rty from whom the
property is tak en m ay give bond to th e plaintiff for n o t less th an
double th e am ount of th e value thereof conditionéd for th e retu rn
of th e sam e or its value in case it shall be adjudged th e plaintiff is
entitled thereto, and thereupon m ay have th e property returned to
him.
S ervice. All service of process is m ade by th e sheriff or b y con­
stables, or by some one specially authorized in any particular case,
and m ust b© issued in th e nam e of th e sta te w ith th e seal of th e officer
issuing th e sam e affixed.
S u its . (See Actions.)
T axes. One-half th e annual, levy for taxes becomes due D ecem ­
ber 20, and if n ot paid th e whole am ount becomes due and there
is a penalty of five per cent added. I f n ot paid b y June 20 of th e
succeeding year, another five per cent penalty is added. 'v £ erl„™®
ta x upon real estate is delinquent it is sold for taxes on th e first
T uesday in Septem ber following. A fter sold it bears interest a t the
rate of 15 per cent per annum and th e sam e ra te upon subsequent
taxes paid and indorsed on th è tax certificate. T he ta x lien attaches
to real estate on N ovem ber l , in th e year in which th e ta x is levied.
A fter land is sold for taxes, it m ay be redeem ed within three years
from date of sale. T he interest of a m inor m ay be redeem ed a t any
tim e w ithin one year after he attain s his m ajority, and idiots and
insane persons m ay redeem w ithin five years after th e sale.
T r u s t C o m p a n ie s. T ru st companies m ay be organized w ith a
capital of n o t less th an $100,000, and m ay receive moneys in tru st
and execute any tru s t com m itted to them , either by any person or
b y order of any court, and m ay execute or guarafatee any bond required
by law to be given in any proceeding in court, and act as agent for
th e investm ent of money, and for th e purpose of issuing, registering,
transferring or countersigning certificates of stock, bonds or other
evidences o f debt, act as guardian and guarantee th e fidelity and per­
formance of d u ty of persons holding public offices or p riv ate.tru sts,
and-certify and guarantee title to real estate and sell all_kinds or
negotiable paper, and receive deposits from banks and other tru st
companies or public officers. T hey are required to keep on hand 25
per cent of deposits subject to check and 10 per cent of tim e deposits,
in th e sam e m anner as sta te banks. E ach director m ust be a stock­
holder in th e sum of n ot less th an $1,000. T ru st companies are
under th e supervision of the bank commissioner and subject to his
exam ination.
T r u s ts a n d R ow ers. All tru sts concerning lands m ust be created ,
in writing except such as arise by im plication of law.
W a re h o u se R e c e ip ts. P ractically th e Uniform “ W arehouse
Receipts A ct.”
W ills. Any person of full age and sound m ind and m emory, hav ­
ing an interest in real or personal property, m ay give and devise-the
sam e to any person by last will and testam ent lawfully executed,
subject, nevertheless, to th e rights of creditors and th e estate given
a spouse by sta tu te . Wills m ust be in writing, signed a t th e end by
th e testato r, or another in his presence and by his express direction,
and subscribed in his presence and a t his request by two or more
com petent witnesses who saw him subscribe Or heard him acknowledge
it. W ills executed w ithout th e S tate in th e m anner prescribed b y th e
law either of th e place where executed or of th e testa to r s domicile or
of th e S tate of Kansas are declared legally executed. Compliance with
these requirem ents should appear in th e witnessing clause. A wifi
executed, proved, and allowed in another State, in th e court of
original probate, according to th e laws of th a t S tate, m ay, relative
to p ro p erty in th is S tate, be adm itted to record in th e p robate court
of th e county in which such p roperty is situated, b y producing an
authenticated copy of th e will an d order of probate adm itting it to
p ro b ate b y th e proper court of th e county and S tate of which
deceased died a resident, after due publication of notice thereof.
E very will, when adm itted to probate, shall be filed m th e office of
th e probate court and recorded.

S Y N O P S IS OF

THE LAW S OF KENTUCKY
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S

Revised by B l a k ey , D avis & L e w i s , Attorneys a t Law.
Inter-S outhern Bldg., Louisville.
(See C ard in A ttorneys’ List.)
Acknowledgments. Deeds executed within th e S tate m ay be
acknowledged before th e clerk of a county court or a notary public,
or m ay be acknowledged before and proven by two m tnesses. Deeds
executed w ithout th e S tate and w ithin th e U nited S tates m ust be
acknowledged before the clerk of a court
of
m ayor of a city, secretary of state, commissioner of deeds, or m oge or
a court ; if executed w ithout th e U nited S tates m i^ t ^
before a foreign m inister, consul, or secretary of legation of th e U nited
S tates or th e secretary of foreign affairs, or judge of a superior court
of t h e ’nation where th e deed shall be executed, atteste d
by th e officer’s seal of office. W hen th e acknowledgm ent is taken,
th e officer m ay sim ply certify th a t th e deed was acknowledged before
him, and when it was done.

1746

B A N K I N G A N D C O M M E R C IA L L A W S— K E N T U C K Y

A ctio n s. Actions are commenced by filing in th e clerk’s office of
th e proper court a petition setting forth th e cause of action and caus­
ing a summons or a warning order to be issued thereon. Non-resi­
dents and corporations, other th an banks, created by laws of this
8 tate, are required to give security for costs.
A d m in is tr a tio n of E s ta te s . Personal estates of deceased persons
m ust be adm inistered b y th e executors nam ed in the will, or if these
refuse to qualify, or none are nam ed, then by an adm inistrator ap­
pointed by the county court of the county in which th e decedent
resided a t th e tim e of his death. A dm inistrators and executors are
required to give bbnd for th e faithful perform ance of th eir duties
and With surety unless otherwise directed by th e will. T hey are
required to file an inventory of th e estate w ithin th ree m onths and
to m ake settlem ent w ithin two years from the date of qualification.
A ffid av its. An affidavit m ay be read to verify a pleading, to
prove th e service of a summons, notice, or other process, in an action;
to obtain a provisional rem edy, an exam ination of a witness, a stay
of proceedings or a warning order; or, upon a motion. An affidavit,
m ay be m ade: 1. In this S tate, before a judge of a court, or a
justice of th e peace, notary public, clerk of a court, or m aster-com ­
missioner. 2. O ut of this S tate, before a commissioner appointed
by th e governor of this S tate; or before any other person empowered *
by a commission directed to him by consent of the parties or by
order of th e court; or before a judge of a court, a justice of the peace,
a m ayor of a city, or notary public.
A p p eals. Appeals m ay be taken from a justice’s court to the
q uarterly court regardless of th e am ount in controversy; from the
q uarterly court to th e circuit court when the value in controversy,
exclusive of interest and costs, exceeds $25; from the circuit court to
th e court of appeals as a m atter of right in all cases in which th e title to
land, or th e right to an easem ent therein, or th e right to enforce a
sta tu to ry lien is directly involved, and in all cases when th e value
in controversy, exclusive of interest and costs, am ounts to $500 or
more, b u t when such am ount in controversy exceeds $200 and is less
th an $500. th e p arty desiring the appeal, m ay upon paym ent of the
tax and filing the record in th e clerk’s office of the C ourt o1* Appeals,
en ter a m otion th a t the appeal be granted. If th e court upon exam­
ination of the record decides th e appeal should not be granted, th e
m otion shall be overruled without a w ritten opinion, and no petition
for a rehearing will be entertained, b ut if the court should be of opinion
th e ends of justice require th e judgm ent be reversed then the appeal
will be granted and a w ritten opinion will be filed. No appeal lies
to th e court of appeals from any judgm ent of a quarterly, city, police,
fiscal or justice’s court, nor from any judgm ent of th e county court.
A r b itra tio n . All controversies which m ight be the subject of a
su it m ay be subm itted to th e decision of one or more arbitrators, or
two and their um pire. T he submission m ay be in writing or by
en try of record, and the agreem ent of submission shall be binding on
th e parties thereto, if it states th e m atter to be subm itted and who
are to be th e arbitrators. E ach arb itrato r and th e um pire, if one
be chosen, shall take an oath to decide the m atter in controversy
fairly and im partially according to law, justice and th e equity of
th e whole case.' The aw ard m ust be in writing signed by each arbi­
tra to r and th e um pire, if any, and shall be a final settlem ent of the
controversy between th e parties. A copy of the aw ard m ust be
given w ithin a reasonable tim e and shall be binding upon both.
A rre s t. An order for th e arrest of th e defendant shall be m ade
by th e court in which th e action is brought or pending, a t its com­
m encem ent, or a t any tim e before judgm ent, if an affidavit of the
plaintiff be filed in his office showing: 1. T he nature of plaintiff’s
claim. 2. T h at it is just. 3. T he sum or value, which the affiant
believes th e plaintiff ought to recover. 4. T h at the affiant believes,
either th a t the defendant is about to depart from this S tate and with
in ten t to defraud his creditors has concealed, or moved from this
S tate, his property, or so much thereof th a t the process of the court
after judgm ent can not be executed; or th a t the defendant has money,
or securities for money, or evidences of debt, in fh e possession of
himself, or of others for his use, and is about to depart from this
S tate w ithout leaving property therein sufficient to satisfy plaintiff’s
claim.
•'
A s sig n m e n ts a n d In so lv en cy . Subject to N ational B ankrupt
Law. E very voluntary assignm ent m ade by a debtor to any person
in tru st for his creditors shall be for th e benefit of all the creditors of
th e assignor, in proportion to their respective claims, after the pay­
m ent of th e expenses of the tru st; except th a t property conveyed
by th e deed of assignment, and upon which there is a valid lien, shall
be applied first to th e discharge of th e lien debt; and except th a t
debts due by th e assignor as guardian, com m ittee, trustee of an
express tru st created by deed or will, or as personal representative,
shall be paid in full before th e general creditors receive anything.
T he in ten t of the assignor in m aking the deed of assignm ent shall
n ot invalidate the deed, unless he be solvent, and it appear th a t the
assignm ent was m ade to hinder or delay creditors. T he deed vests
In th e assignee th e title to all the estate, real and personal, belonging
to th e assignor a t th e tim e of m aking the assignm ent, except th a t
property exem pt by law shall not pass unless em braced in th e deed.
I f th e assignor, before m aking th e deed, shall have m ade a preferential
or fraudulent transfer, conveyance, or gift of any of his property,
or fraudulent purchase of any property in the nam e of another, the
property so fraudulently transferred, conveyed, or purchased shall
vest in th e assignee, and it shall be his duty to institute such pro­
ceedings as m ay be necessary to recover same. If. upon dem and,
he refuses to do so, any creditor m ay, and the property so recovered
»hall become a part of the estate, and be distributed as other assets.
I f creditors representing one-half in num ber and tw o-thirds of the
am ount of debts against the estate shall so request in writing, the
court shall rem ove th e assignee and appoint another in his stead.
A tta c h m e n ts . The w rit m ay issue against a defendant who is a
foreign corporation or non-reisdent of th e S tate; or has been absent
from S tate four m onths; or has left th e S tate with in ten t to defraud
creditors; or has left his county to avoid service of summons: or
so conceals him self th a t summons cannot be served; or is about to
rem ove, or has rem oved his property or m aterial p a rt out of the
S tate n o t leaving enough to satisfy claim of plaintiff or defendant s
creditors; or has disposed or is about to dispose of or sell his property,
or perm itted to be sold or disposed of w ith fraudulent in ten t o t cheat,
hinder or delay creditors. Also in action for money due upon con­
tra c t judgm ent 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 judgm ent and return of
nulla bona. Also in action for persona) property ordered to be
delivered to plaintiff which as to p a rt thereof has been disposed of,
removed, or concealed, so th a t order of delivery can not be executed.
Affidavit as prescribed by civil code and bond required, except no
bond required in action upon nulla bona return.
B a n k s. I t 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 m ay be organ­
ized to conduct both a banking and tru st com pany business. The
boards of directors of banks and tru st companies domg business^ in
th is S tate have full power and authority to fix the hours of opening
and closing of said banks and tru st companies, and m ay provide
th a t on Saturday of each week such hour of closing be as early as
twelve (12) o’clock noon. A D epartm ent of Banking, providing for a
Banking Commissioner, deputy commissioner and examiners of State
banks» and prescribing their duties and for th e exam ination of all
financial institutions organized and doing business under thel laws of
th e S tate was created by a law effective July 1st, 1912.
B lu e S ky L aw . The Blue Sky Law of K entucky is a com pre­
hensive regulation of th e sale of corporate securities, based on the
law of M lfhigati Those interested should refer to provisions of the
law.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Before transacting business in K entucky investm ent companies
issuing securities m ust file a detailed statem ent of their organization
plan of business, and financial condition w ith th e State Banking
Commissioner who has th e power to investigate, approve or disapprove
any such business proposed. Non-residents m ust appoint th e banking
commissioner agent for service of process. Books of all concerns
m ust be open to inspection. Dealers m ust obtain licenses from the
banking commissioner who m ay revoke them in certain cases.
T he following classes of secutiries are exem pted from th e operation
of th e law :
Securities issued b y th e U nited States, any foreign government, any
S tate or T erritory or sub-division thereof; public utilities; banks,
tru s t companies and building and loan associations; domestic cor­
porations w ithout capital stock not organized for gain; of corporations
listed in any standard m anual except as otherwise provided; securities
sold through a licensed dealer, m em ber of a recognized stock exchange
in K entucky; listed on any stock exchange recognized by th e banking
commissioner or securities senior thereto; those sold or offered to a
licensee under th e act; unsecured commercial paper; mortgages on
real or personal property in K entucky where th e entire mortgage is
transferred; stock dividends and increase of stock sold and issued to
stockholders
C h a tt e l M o rtg a g e s a n d D eeds of T r u s t. N o deed of trust or
mortgage, conveying a legal or equitable title to real or persona)
estate, shall be valid against a purchaser for a valuable consideration,
w ithout 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 im prisonm ent, for any per­
son to sell any personal property, on which there is a mortgage of
record, with th e in ten t to prevent the foreclosure of the mortgage
and a sale of the property.
C h e ck s. T he issuing of checks in this S tate upon banks where
th e drawer has not sufficient funds on deposit to pay same is now a
crim inal offense. If am ount under $20.00 it is a misdemeanor, and
th e penalty $100.00 or jail confinement one to th irty days, or both
such fine and im prisonm ent in discretion of th e C ourt or Jury. If
the check be for $20.00 or more, it is a felony and confinement in
penitentiary for n ot less th an one or more th an two years, but if
the draw er of th e check shall pay same within tw enty days after
receiving notice of the dishonor of th e check, he shall not be prose­
cuted; or if the prosecution has been begun, it shall be dismissed at
cost of the m aker of th e check.
C o n tr a c ts . A seal or scroll is in no case necessary to give effect
to a deed or other writing. All unsealed writings stand upon the
sam e footing with sealed writings, having the same force and effect,
and the sam e actions m ay be founded upon them . The State or
county seal, or th e seal of a court, corporation, or notary to any
w riting has not. however, been dispensed with.
C o n v e y an ces. (See Acknowledgments.)
C o rp o ra tio n s . Form ed under th e general laws for transaction of
any lawful business. Special regulations prescribed for foreign cor­
porations doing business in th e S tate, and for banking, building and
loan, tru st, insurance, and railroad companies. Cum ulative voting
prescribed. Stockholders in banks, tru st companies, guaranty com­
panies, investm ent 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 th e am ount of their stock at
par value in addition to am ount of such stock; b u t persons holding
stock, as fiduciaries, are not personally liable, b u t estates in then
hands are in sam e m anner and to same extent as other stockholders,
and no transfer of stock operates as a release, of any such liability,
existing a t tim e of transfer, provided action to enforce the liability
be commenced w ithin two years from tim e to the transfer. Article«
acknowledged and recorded like deeds in county in which principal
place of business is situated, and a copy thereof filed and recorded
in the office of the secretary of S tate. After such filing and recording,
and paym ent to S tate of license tax of one-tenth of 1 per cent on
its capital stock, corporation is deemed organized; but. before trans­
acting business o ther than with its own stockholders, a t least 50
per cent of stock m ust in good faith be subscribed, payable at such
tim es as board of directors m ay require.
In 1920 K entucky adopted a “ Blue S ky” law prohibiting the sale
of stocks or securities (with nam ed exceptions) until approved by
the State Banking Commissioner, who requires full information on
blanks furnished by his office.
C o u rts . General civil and criminal jurisdiction is vested In cir­
cuit courts which hold term s in each county as provided by statute.
C re d its. By an Act approved M arch 14, 1914, it is provided
th a t a person who shall knowingly in person or through any agency
m ake any false statem ent in writing with inten t it shall be relied
upon, respecting his financial condition, or m eans or ability to pay.
for the purpose of procuring delivery of personal property, the pay­
m ent of cash, the making of a loan or credit, or extension of credit,
and procures upon faith thereof either or any of th e things or benefits
m entioned, shall be guilty of a felony and upon conviction, snan
oe confined in th e penitentiary not less th an one nor more than five
years.
b a y s of G race. (See N otes and Bills of Exchange.)
d e p o s itio n s m ay be taken in all equitable actions, and In ordinary
or common law actions, where witness resides tw enty miles or more
from place where court is held, or is absent from State, and In maw
other cases enum erated in th e sta tu te where the witness is privileges
Depositions are taken either on notice to opposite party or upon
w ritten interrogatories. T he ordinary m ethod of taking is up»“
notice, b u t where place of taking is more th an one day s travel Dy
ordinary m ethods and more th an one hundred miles from the place
of sitting of court, th e p arty receiving notice m ay require deposition
to be taken upon interrogatories by giving notice to th a t effect
adverse p arty 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, Pa™“
against whom they are to be read have been constructively’ sun*
moned and have n ot appeared, or be dfendants, or under dlsaDiuw
other th an coverture or infancy and coverture combined, in seven«
other cases enum erated in the civil code, th e court may requu
depositions to be taken upon interrogatories, and they m ay aiway
be so taken by consent of all parties. Officers authorized to tax
depositions in th is S tate: An exam iner appointed by judge oi cir
cult court of this district, a judge or clerk of a court, Justice or peac ,
or notary public. Depositions m ay be taken out of this State ceio
a commissioner appointed by governor of th is State or oeioro
judge of a court, a justice of peace, m ayor of city, notary puu .
or any other person empowered by a commission issued to miu j
consent of th e parties or by order, of court. If deposition is tax
upon interrogatories neither p a rty is allowed to be present, eiuu
In person or by agent attorney. The officer’s certificate must s
when and where th e deposition was taken; th a t th e witness
.
duly sworn before giving it, and th a t it was w ritten and sunscr
by v»im in officer’s presence, or was w ritten by officer m preso
of witness and read to and subscribed by witness in presence ot om
D e sc e n t a n d D is tr ib u tio n of P ro p e rty . The ireal estate
person dying in testate shall descend in parcenary to his kinurea,
and fem ale/ in the following order, viz: (1) To his children ana
their descendants; if none, then (2) to his fath er and ^pother equaa^
if both be living; if either be dead, the whole estate d e s c e n d s w
,
one living; if both be dead, then (3) to his brothers and siste “ u
their descendants; if none, then (4) one m oiety of th e esta
pass to th e paternal and th e other to th e m tarenal kindreu,

B A N K IN G A N D C O M M E R C IA L L A W S— L O U IS IA N A
following order: (5) to th e grandfather and grandm other, or which­
ever m ay be living; If both are dead, then (6) to uncles and aunts
and tneir descendants; if none, then (7) to great grandfather and
great grandm other, and so on in other cases without end, passing
to the nearest lineal ancestors and their descendants. (8), If there
Is no kindred to one of the parents, the whole shall go to the kindred
of the other. I f there is n either paternal nor m aternal 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 h ad survived
the Intestate and died entitled to the estate. W hen any or all of a
class first entitled to tak e are dead, leaving descendants such descend­
ants shall tak e per stirpes, th a t 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 m aking
title by descent, it shall be no bar to a p arty th a t any ancestor,
through whom he derives his descent from the intestate, is or has
been an alien. B astard can inherit in the descending line only from
the m other and h er kindred, and can transm it inheritance in the
ascending line only to th e m other and her kindred.
D ow er. (See H usband and Wife.)
E x e c u tio n s m ay issue upon judgm ent any tim e until collection of
it is barred by lim itation, b u t no execution shall issue on any judg­
ment, unless ordered by th e court, until after ten days from rendition.
Execution constitutes lien on property of debtor from tim e it reaches
hands of proper officer. Provided th a t such lien shall be veid as to a
purchaser for value w ithout notice unless notice of such execution
shall be filed in th e office of the C ounty Clerk. Execution m ay be re­
plevied for three m onths, any tim e before sale under same, by defend­
ant giving to th e officer an obligation (replevin bond) payable to plain­
tiff, with good security for the am ount thereof, interest and costs. A
judgment to enforce a lien cannot be replevied. N o replevy allowed
upon judgm ent against an y collecting officer, attorney a t 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 judgm ent, nor upon
Judgment for specific property, or for the property, or Its value.
If land sold does not bring tw o-thirds of appraiser s valuation, defend­
ant and his representatives have right to redeem w ithin a year from
the day of sale, by paying purchaser or his representatives original
purchase money and ten per centum per annum Interest.
E x em p tio n s. The following property of persons' with a fam ily
resident in this Commonwealth, shall be exem pt from execution,
attachment, distress, or fee bill, nam ely: 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 m anufactured cloth m anufactured by the fam ily
necessary for family use; carpeting for all family rooms In use; one
table; all books not to exceed seventy-five dollars In value; two
laddies and their appendages; two bridles; six chairs; or so m any
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 th e fam ily for one year; provender suitable
for live stock, If there be an y 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 m achine, and all fam ily
portraits and pictures; one cooking stove and appendages, and other
cooking utensils not to exceed in value twenty-five dollars; ninety
per centum of the salary, wages, or income earned by labor, of every
person earning a salary, wages, or income of seventy-five dollars or
less per m onth, provided th a t the lien created by service of garnish­
ment, execution, or attachm ent, shall only affect ten per centum
of such salary, wages, or income, earned a t th e tim e of service of
process; of th e salary, wages, or income earned by labor, of very
erson earning a salary, wages or income in excess of seventy-five
ollars per m onth, sixty-seven and one-half dollars per m onth and
no more shall be exempt.
Tools of a mechanic, not exceeding one hundred dollars in value
libraries of m inisters of the Gospel, professional libraries of lawyers
professional libraries and instrum ents of physicians and surgeons, not
to exceed in value five hundred dollars. In addition to personal
property there is for actual bona fide housekeepers w ith a family
resident in th is Commonwealth a hom estead exem ption of so m uch
land Including th e dwelling house and appurtenances owned by
debtor a s . shall not exceed in value one thousand dollars. This
does not extend to a m ortgage on or purchase m oney due for th e land
or for debts o r liability existing prior to the purchase of th e land, or
of the erection of the im provem ents thereon.
Personal property or money on hand or in bank to th e am ount of
$750.00 shall be exem pt from distribution and sale and shall be set
apart by th e appraisers of th e estate of an intestate to his widow and
children, or, if no widow, to his infant children or child surviving him.
The appraisers shall sta te in their appraisem ent th e money or the
articles and value of each set ap art by them to th e widow, or infants,
separately to th e articles appraised for sale, b ut if the widow be present
at the tim e of th e appraisem ent, or any one authorized by her in
writing, she m ay m ake her selection out of the property appraised to
the am ount of said $750.00 and said appraisers shall so report. The
provisions of this section shall apply to cases where th e husband dies
testate, and tn e widow renounces the provisions of the will in the
time prescribed by law.
H olidays. T he 1st day of January, the 22d day of February, the
10th day of M ay, th e 4 th day of July, the first M onday in Septem ber
(Labor D ay), th e 12th day of October (Columbus D ay), th e 25th
day of December of each year, and all days appointed by th e president
of the U nited States, or by th e governor of this S tate, as days of fasting
and thanksgiving are declared holidays, and shall be treated as Sun­
day. I f any of those days nam ed as holidays shall occur on Sunday,
the next day th ereafter shall be observed as a holiday.
H u sb a n d a n d W ife. By an act which took effect June 12, 1894,
the following im portant changes were m ade in th e common law of
coverture which theretofore prevailed in K entucky. M arriage gives
to the husband during th e 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 th a t she can not bind herself to answer
for the debt, default, misdoing of another, except as to property
let ap art for th a t purpose by m ortgage. She m ay sell a n a dispose
of personal property as if unm arried, b u t m ay n ot sell or convey
real estate unless her husband unites in th e contract, or conveyance
unless empowered to do so by decree of court, in case of insanity,
conviction of felony, or abandonm ent by th e husband. A fter the
death of either husband or wife the survivor shall, have a life estate
ta one-third of all th e realty of which th e decedent was seized in fee
simple during th e coverture unless such right shall have been for­
feited or relinquished. Such survivor has also one-half th e personalty
of the decedent left after th e paym ent of debts. Abandonm ent and
¡lying in ad ultery by either party, or divorce works a forfeiture of
these rights.
Interest. T he lawful ra te of interest is 6 per centum per annum ,
*nd contracts for a greater rate are void as to th e excess of interest.
. Ju d gm en ts. A judgment- does n ot constitute a lien on property
m this S tate. All judgm ents bear interest from their dates. (See
Executions an d Lim itations.)
L im itation s.
T he following are the periods w ithin which actions
must be brought, th e tim e commencing to run from the accrual of
the cause of action. Fifteen years: Actions to recover real property;


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1747

actions upon judgm ents and w ritten contracts, except negotiable
instrum ents. 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
sta tu te; actions for trespass to real or personal property or for dam ­
ages for withholding same; for th e specific recovery of personal prop­
erty; actions upon negotiable instrum ents, though as to the makers
of an undiscounted, note it is fifteen years and as to sureties seven
years; actions upon accounts between m erchants, and actions for
relief from fraud or m istake. Two years: Actions upon m erchant’s
accounts for goods sold. One year: Actions for injury to person or
character and for breach of prom ise of m arriage.
M e rc h a n d is e i n B u lk . An Act of the 1920 Legislature provides
th a t when any one who shall buy any stock of goods in bulk or fixtures
before he shall deliver to th e vendor th e purchase price or any promis­
sory note therefor shall obtain from the vendor a verified w ritten
statem ent of all the creditors of the vendor together w ith their addresses
and the am ount of indebtedness due to each, also an accurate in­
ventory of the stock or fixtures to be purchased and m aking it the
d u ty of the vendor to furnish such statem ent under oath. Upon
receiving such a statem ent the purchaser shall notify, personally or
by registered mail, each of th e creditors of said vendor as appears
on th e list, of the proposed sale, th e price to be paid therefor, the
conditions of the sale and a copy of the statem ent furnished by the
vendor. This notice shall be given or sent a t least ten days before the
completion of the sale.. I f any such purchaser fails to obtain a verified
statem ent from the vendor or to give the notice to the creditors as
above or to see th a t th e 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
a t th e suit or option of the creditor be held liable to th e creditors for
the fair value of all property so bought or sold, provided, however,
such suit m ust be brought within four m onths.
N o tes a n d B ills o f E x ch an g e. An act relating to negotiable
Instrum ents became a law June 13, 1904. Section 1 declares th a t an
instrum ent to be negotiable m ust conform to the following require­
m ents. (1) I t m ust be in writing and signed by the m aker or
drawer. (2) M ust contain an unconditional prom ise or order to
pay a certain sum in money. (3) M ust be payable on dem and, or
a t a fixed or determ inable future tim e. (4) M ust be payable to th e
order of a specified person or to bearer. (5) W here the instrum ent
is addressed to a drawee, he m ust be nam ed or otherwise indicated
therein with reasonable certainty. D ays of grace are abolished.
T he signature of any p arty m ay be m ade by an agent duly authorized
in writing. E very negotiable instrum ent is payable a t the tim e fixed
therein; when the day of m aturity falls upon Sunday, or a holiday,
th e instrum ent is payable on the next succeeding business day.
P ow ers of A tto rn e y . Powers of attorney to convey real or per­
sonal property m ay be acknowledged, proved and recorded in the
proper office in the m anner prescribed for recording conveyances. If
the conveyance m ade under a power is required by law to be recorded
or lodged for record to m ake the same valid against creditors and pur­
chasers. then the power m ust be lodged or recorded in like m anner.
P r o te s t. , W here any negotiable instrum ent has been dishonored
it m ay be protested for non-acceptance or non-paym ent as the case
m ay be; b ut protest is not required, except in the case of foreign bills
of exchange. I t is the safer practice to protest in all cases, because
in all cases notice of dishonor is necessary to charge parties secondarily
liable.
T axes. S tate and C ounty taxes in K entucky for any year are a
lien against real estate from and after July 1st of th e preceding year.
The cities and towns of K entucky are divided into six classes and th e
liens of th e various classes for taxes on real estate date from the
following:
F irst Class, Septem ber 1st for succeeding year.
Second Class, July 1st, for succeeding year.
T hird Class, from date fixed by C ity Council for succeeding year
F ourth Class, April 1st for current year.
F ifth and Sixth Classes, Septem ber 15th, for succeeding year.
Taxes due the S tate by banks and tru s t companies are payable
directly into th e S tate treasury on or before the first day of July
succeeding reports by their chief officers required to be m ade to
auditor of public accounts, and taxes to counties, cities, towns and
districts are paid a t the tim e fixed by law for paym ent of like taxes.
W ills. Any person of sound m ind and over twenty-one years of
age m ay m ake a will. Wills m ust be in writing w ith the nam e of
the testa to r subscribed thereto either by himself or by some other
erson in his presence and by his direction. If not wholly w ritten
y th e testato r th e subscription m ust be m ade or the will acknowledged
by the testa to r in the presence ¡of tw o witnesses, who shall subscribe
their nam es in the presence of the testator. T he will of a person
domiciled out of this S tate is valid as to personalty, if executed accord­
ing to the law of the domicile; b u t to be valid as to lands, it m ust be
executed as required by th e law of this S tate. T he county court
has exclusive original jurisdiction over the probate of wills.

S Y N O P S IS OF

THE LAW S OF LOUISIANA
RELATING. TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised by M essrs M e k r ic k & S c h w a r z , A ttorneys a t Law, CanalComm ercial Bank Bldg., New Orleans.
(See C ard in A ttorneys’ List.)
A c c o u n ts. (See Acknowledgments.)
A c k n o w le d g m e n ts of deeds executed within the S tate m ay be
made before a judge, notary public, parish recorder or his deputy, in
the presence of tw o witnesses. These witnesses m ust be over fourteen
years of age. In other States, before a commissioner of Louisiana,
or any officer authorized to take depositions in the S tate where he
resides. Any such officer’s official seal is sufficient certification of
his official Capacity, In foreign countries every deed, conveyance,
mortgage, sale, etc., m ade or taken before any am bassador, m inister,
charge d ’affaires, secretary of legation, consul-general, consul, viceconsul, or commercial agent, any officer of the United States, N otary
Public or Commissioner of this State, and every acknowledgement,
attestation, or authentication of any of said instrum ents, oaths, etc.,
m ade by any of said officers under their official seals and signatures
shall have th e full force and effect of an authentic act executed in th is
State. No witnesses necessary. P arty appearing before any of said
officers need not be a resident of th e place where said officer is located.
N otarial copies of original when deposited in this sta te in a n o tary ’s
office have full force and effect of authentic copies of acts executed
in th is S tate. [Act 164 of 1898.]

1748

B A N K IN G A N D C O M M E R C IA L L A W S— L O U IS IA N A

A c tio n s. Commenced by petition setting forth cause of action,
articulately in num bered paragraphs, signed by plaintiff or his attorney
and d u ly sworn to. Plaintiff m ust give resident security for costs or
m ake deposit to cover sam e if dem anded. (See Act 300 of 1914
regulating pleadings and practice.) A fter filing of petition, defendant
is cited to appear te n days after receipt of citation in D istrict C ourts
an d Justice of Peace courts outside oi city of New Orleans. . One day
additional for every ten miles his residence is d istan t from court.
Delay in no case to exceed fifteen days. In city courts of New Orleans,
defendant m ust appear three days after receipt of citation. N either
day of service nor day on which answ er m ust be filed is included in
delay. If defendant fails to appear, judgm ent by default is rendered
against him . In district courts such judgm ent is confirmed tw o
judicial days after prelim inary en try of default. In Justice of Peace
courts judgm ent of default is confirmed th e sam e day as th a t on which
default is entered.
A d m in is tr a tio n o f E s ta te s by executors, adm inistrators, or
tu to rs who are ex-officio adm inistrators—also by dative executors—
where th ere is no heir present or agent of heir, public adm inistrator
takes charge. A non-resident executor of a will m ust in all cases give
bond; a resident does n ot unless required by creditors. A dm inistra­
tors and executors of other states m ust open succession of deceased
in th e courts of this S tate, and be recognized as such here before th ey
can sue or be sued or transfer p roperty in this S tate. Stock in local
corporations m ay be transferred by non-resident, executors, etc.,
w ithout th e necessity of securing an order from th e local court, b u t
no tran sfer can be m ade u ntil th e inheritance tax is adjusted. No
debts can be paid by adm inistrator w ithout authorization of probate
court. T he adm inistrator or executor presents to th e court an
account or tableau of distribution setting forth th e paym ents and
disbursem ents he proposes to m ake. P arties interested are notified
by publication to show cause w ithin te n days why th e account so filed
should n o t be approved. Any p a rty interested m ay oppose the
account b y opposition in w riting a t any tim e w ithin th e said ten days
In absence of opposition account is hom ologated upon production of
satisfactory evidence by adm inistrator or executor, and th e funds
ordered d istributed in accordance therew ith.
Claims against estates should be presented in w riting to th e adm in­
istrato r or executor. Should he approve th e sam e in w riting, no
fu rth er action is required except to see th a t th e claim is placed upon
his account when filed. Should he decline to recognize th e claim,
creditor m ay file suit against succession representative and obtain a
judgm ent to be paid in ordinary course of adm inistration. I f there
Is no danger of prescription, creditor m ay aw ait filing of account and
th en oppose sam e of claim, n ot included.
A ffid av its. (See Acknowledgments.)
A lien s. N o alien who is ineligible to citizenship of th e U nited
States m ay hold land or any real right. Aliens m ay n ot vote.
A r b itra tio n . Agreements to subm it to arbitration recognized by
law. A rbitrators m ust be sworn, otherwise decision is n o t binding.
S tate board of arbitration of labor troubles established. [Act 139
of 1894.]
A rre s t for d eb t m ay be m ade on affidavit th a t th e deb t is really
due, an d th a t petitioner verily believes th a t debtor is about to remove
from th e S tate perm anently, w ithout leaving in it sufficient property
to satisfy his dem and; and th a t he does n ot take his oath w ith inten­
tion of vexing debtor, b u t only in order to secure his dem and. D ebtor
m ay be discharged by disproving facts; by giving bond, by m aking
surrender, by delivering to sheriff property sufficient to satisfy dem and.
Arrest of th e debtor only secures his presence to answer th e suit;
he cannot be held for th e paym ent of th e debt. M inors, interdicted
person and women n o t subject to arre st for debt.
A s sig n m e n ts a n d In so lv e n c y . S tate insolvent laws superseded
by N ational B ankruptcy act.
A tta c h m e n t. W rits of attach m en t issue on application of credi­
tor, under oath, when th e debtor resides out of th e S tate; when he
conceals himself to avoid being cited; when he has m ortgaged, assigned
or disposed of, or is about to m ortgage, assign, or dispose of his prop­
erty, rights, or credits, or some p a rt thereof, w ith in ten t to defraud
his creditors or give an unfair preference to some of them ; and when
he has converted, or is about to convert, his p roperty into money
or evidences of d eb t w ith in ten t to place it beyond th e reach of his
creditors, or, if debt n o t due, is about to rem ove his property out
of th e S tate. C reditor m ust furnish bond equal to th e am ount
claimed to be due, w ith a t least one solvent surety, residing within
th e jurisdiction of th e court, conditioned for paym ent to any p arty
injured by issuance of w rit of all dam ages sustained b y him in case
it is decided th a t th e attach m en t was wrongfully obtained. (Act
No. 7, 1888.) Bond for $250 is sufficient if debtor resides outside of
sta te b u t bond m ay be increased to am ount of claim upon- order of
court a t dem and of debtor. G arnishm ent m ay be had as an accessory
eith er to a w rit of attachm ent or fieri facias. A ttachm ent m ay now
issue for an offense, quasi offense or to rt if defendant is non-resident
(Act 215 of 1920).
B a n k s. Banking corporations organized under banking laws
adopted in 1855, am ended in 1888, in 1892, and in 1902. Savings,
deposit, and tru s t companies provided for by Act 150 of year 1888,
am ended by Act 95 of 1892, which is now am ended by A ct 189 of
1902. T he num ber of persons organizing m ust be five or more. No
special act of incorporation can be passed. B y Act 189 of 1902,
th e general banking act of 1855 and th e am endatory acts of 1888 and
■of 1892 are am ended as follows: 1. Period of tim e m ust be fixed
In act n o t to exceed ninety-nine years. 2. Banks can n ot hold real
«state for longer tim e th an five years, except such as necessary for
th e transaction of their business, or except th a t held as agent or
trustee. 3. All m anagers and directors shall be citizens of Louisiana.
4. Safe deposits and tru st banks w ithout power to issue bank notes,
m ay be organized under t his law w ith a capital of $50,000 or more,
of which capital a t least $10,000 shall be paid up before commencing
business. I n incorporated towns w ith less th an 20,000 inhabitants
m ust have cash capital of n o t less th a n $30,000, which m ust be paid
up before can commence business. I t m ay be m ade a receiver,
trustee, assignee or syndic, and execute tru sts of every description.
M oney or other valuables deposited by m arried women or m inors
m ay be drawn o ut w ithout th e authority of their husbands or tutors.
U nder Act 45 of 1902, banks organized to do a savings, safe deposit
an d tru st banking business m ust be composed of m ore th a n five
persons, m ay be organized for not longer th a n ninety-nine years,
■may not hold real estate for longer period th a n ten years, except
such as is held as agent or trustee, or necessary for transaction of
th eir business; m ay accept and execute tru sts or agencies of all descrip­
tions, m ay be appointed by an y person or by court executor, adm inistrator, syndic, receiver, eurator, tutor, trustee or assignee. Capi­
ta l stock considered as security for faithful perform ance o f duty,
though court m ay require other security, and m ay require th e sta te
exam iner of banks to investigate th e affairs and m anagem ent of
th e bank. Such banks can n ot issue notes and m ust have a capital
n ot less th an $100,000, which m ust be paid up in cash. (See A ct 121
of 1910 «.mending Act 45 of 1902 as to capital required in cities of
less th an 30,000,) (See also Act 179 of 1902, and am endm ent thereof.
Act 140 of 1906 and am endm ent thereof, A ct 152 of 1910 and am end­
m ent thereof, A ct 96 of 1912 and Act 184 of 1916.) Act 238 of 1910,
amending' Act 45 of 1902, provides for branches.
Act 112 of 1910
creates a S tate Banking D epartm ent having supervision over all
sta te banks. Amended by Act 48 of 1912.
C h a tt e l M o rtg a g e s . A s provided for by Act 198 of 1918, any
kind of m ovable property m ay be m ortgaged for debts, for money
loaned, fu tu re advances or to guarantee contracturai obligations.
T he act of m ortgage m ust be passed before a N otary Public and two
witnesses and m ust be recorded in Parish where property!* situated


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

and Parish where m ortgagor resides in order to affect third persona
w ithout notice. C hattel so m ortgaged cannot be transferred from
one parish of th e S tate into another w ithout w ritten consent of
m ortgagee.
C o lla te ra ls m ust be delivered to be effectual. A ct 9 of 1914
m akes it a felony for a custom er of bank to wrongfully dispose of
collateral security pledged to bank. Uniform Bills of Lading law
obtains. (Act 94 of 1912.)
C o n d itio n a l S ale. Act 119 of 1918 m akes lawful a conditional
sale of tan k cars providing for retaking of car by conditional vendor
w ithout rig h t of redem ption being given to vendee, all paym ents of
such d ate of retaking being forfeited. A ct 111 of 1894 provides for
conditional sale of railw ay equipm ent. O ther conditional sales of
m ovable property are ineffective as between th e p arties or innocent
th ird persons.
C o n v e y an ces. All agreem ents affecting real pro p erty m ust be
in writing, and transfers and m ortgages, etc., m ust be recorded in
th e place where th e property is situ ated to affect th e rights of third
persons. D eeds are m ade under private signature or b y act passed
before a notary public in th e presence of tw o witnesses. B oth vendor
and vendee sign, though signature of vendee is n o t essential, as any
act of acceptance will answer. T he n otary in P arish of Orleans pre­
serves th e originals of deeds passed before him and certified copies
given by him are received as evidence in th e courts. E very notarial
deed should contain (1) date of a ct and place where it was passed, (2)
nam es and surnam es and qualities of contracting parties, (3) descrip­
tion of th e property, etc., (4) price of transfer and term s and conditions.
(5) T he m arital status, of all parties m ust be given. W hen a married
woman executes a deed she m ust be authorized by her husband. The
husband acts alone in th e sale of com m unity property; th e signature
of th e wife being unnecessary. E ither husband, or wife, if husband
refuses to do so, m ay designate fam ily hom e by registration. If so
designated, wife’s signature necessary to pass title.
C o rp o ra tio n s . A ny num ber of persons, exceeding six, m ay form
them selves into ' corporations for literary, scientific, religious, and
charitable purposes; for works of public im provem ent, an d generally
all works of public u tility and advantage; and any num ber of persons,
n o t less th an three, m ay form them selves into a corporation for the
purpose of carrying on mechanical, mining, or m anufacturing business,
except distilling or m anufacturing intoxicating liquors, w ith a capital
n ot less th an $5,000 or m ore th an $1,000,000. Any num ber of per­
sons, n ot less th an three, m ay form them selves into a corporation on
complying w ith the general corporation laws, for th e purpose of carry­
ing on any lawful business 'or enterprise n o t otherwise specially pro­
vided for, except banking and insurance, hom estead an d building
and loan associations. F ifty per cent of capital stock m ust be sub­
scribed before filing articles of incorporation and 50 per cent of all
stock subscribed m ust be paid in before corporation engages in busi­
ness and th e rem ainder in twelve m onths under penalty of dissolution.
T he legislature can n ot pass a special act conferring corporate powers.
Corporation com m itting a trespass or dam age m ay be sued a t place
where it occurred. [Act 22 of 1894.] (See A ct 454 of 1902 for for­
m ation of corporations for works of public im provement.) Act 120
of 1902 provides for organization, etc., of local an d foreign building
and loan or hom estead associations. N o corporation can declare
dividends out of its capital stock, under penalty of forfeiture of its
charter. M eetings of corporations m ust be held a t domicile. [Act
63 of 1910.1
Foreign Corporations m ay be licensed and taxed b y a mode differ­
en t from th a t provided for home corporations. N o domestic or for­
eign corporations shall do any business in this S tate without having
one or m ore known places of business and an authorized agent or
agents in th e S tate upon whom process m ay be served. All corpora­
tions (except m ercantile corporations) domiciled o u t of th e State and
doing business in th e S tate in default of filing w ith th e secretary of
sta te a declaration of th e place of its locality or domicile together with
th e nam e of its agent in th e S tate upon whom service of process may
be m ade, m ay be sued upon any cause of action in an y parish where
the rig h t of action arises.
Foreign corporations m ust file in office of secretary of sta te a written
declaration setting forth and containing th e place or locality of its
domicile, th e places in th e S tate where it is doing business, and the
nam e of its agent or o th er officer in th is S tate upon whom process may
be served. (Act 54 of 1904 am ended by A ct 284 of 1908. Act 284
of 1908 am ended b y 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-tw entieth of 1 per cent on th e am ount of the capital
stock em ployed in th is state. A ct to operate prospectively only.
A ct 267 o f 1914 r e la tin g to c o rp o ra tio n s re p e a le d several
p rev io u s a c ts a n d u n d e r ta k e s to e m b o d y i n o n e a c t all essen­
t i a l d e ta ils w ith re s p e c t to t h e o r g a n iz a tio n , p o w er a n d d u ties
of tr a d in g c o rp o ra tio n s , fo re ig n a n d d o m e s tic . (As to n o n ­
t r a d in g c o r p o ra tio n s see A ct 259 of 1914.)
C o u rts . Term s and Jurisdiction. In parishes other th an Orleans;
Justices’ courts, concur rent w ith D istrict courts up to $100. 2.
D istrict courts, concurrent w ith justices’ courts, up to $100, exclusive
for all civil m atters over $100, and in all probate m atters and appellate
jurisdiction in all civil m a tte rs in justices’ courts. I n Orleans parish,
i j C ity courts, exclusive up to $100. C oncurrent w ith Civil District
court from $100 to $300. 2, Civil D istrict court, concurrent up to
$300, exclusive over $300. Justices and city courts open a t all times.
I n parishes other th a n Orleans, district courts shall hold continuous
sessions during ten m onths of th e year. In parish of Orleans, civil
district court sits during 9 and X
A m onths of th e year, b u t shall remain,
open on all legal days during th e whole y ear for granting interlocutory
orders, issuing writs, trials of rules to quash same, try in g proceedings
instituted, or on appeal therein by a landlord for th e possession or
leased property, partition proceedings, and for such special probate
and insolvency business, as th e courts en bano m ay by rule determine.
On all am ounts up to $2,000, inclusive and in suits for damages or
d eath caused b y wrongful injury, an appeal m ay be taken to tne
court of appeals, from th e city and district Courts respectively, ana
on all am ounts over $2,000, except suits for damages or death caused
by wrongful injury, to th e sta te suprem e court. An appeal lies on
both law and facts. Appeals from th e city courts shall be tried ae
novo, except suits for am ounts between $100 and $300.
D ays o f G ra c e . Abolished.
D e p o sitio n s. To tak e testim ony of witness residing out of parish
or S tate it is necessary to file m otion duly sworn to showing non-resi­
dence and m ateriality of evidence. W ritten interrogatories are pre­
pared and served on opposite p arty, or his counsel, who has three days
m which to cross. Commission then issues, directed to some proper
officer, w ith interrogatories and cross interrogatories annexed, wno
m ust cause witness to appear before him to answer under oatn me
direct and th e cross interrogatories. H e should reduce answer to
writing, read sam e to witness and cause witness to sign same. iu e
officer th en prepares a process verbal of th e whole, attaches it to tne
commission, interrogatories, etc., and should retu rn same to the coun<
issuing th e commission w ithin th e tim e fixed therein for taking too
deposition. T he deposition of a fugitive from justice is n ot admission
in evidence. (Also see A ct 176 of 1910.)
D e s c e n t. I f one dies leaving no descendants, b u t a father and
m other and a brother and sister, or descendants of these last, too
succession is divided into tw o equal parts, one goes to father auu
m other, th e other to brothers and sisters or their descendants. «
either fath er or m other of deceased dies before him, th e portion wmu»
would have been inherited by such deceased paren t foes to t o brothers and sisters of th e deceased, or their descendants. It heceasou
left n either descendants nor brothers nor sisters, nor descendants iro
them , nor fath er nor m other, b u t only other ascendants, they
'
to th e exclusion of all collaterals. I f ascendants in paternal an
m aternal lines ar e all of th e same degree, th e estate is divided m

B A N K IN G A N D C O M M E R C IA L L A W S — L O U IS IA N A
rwo Darts, one goes to ascendants on th e paternal and th e other to
ascendants on th e m aternal side. I f th ere is in th e nearest degree
but one ascendant in th e two lines such ascendant excludes au other
ascendants of a more rem ote degree. I f one dies leaving no descen­
dants. and his fath er and m other survive, his brothers and sisters,
or their descendants, tak e half of his estate. I f th e father or m other
only survive, brothers and sisters, or th eir descendants, tak e threefourths. If one dies leaving no descendants nor fath er nor m other,
his brothers and sisters, or their descendants, take all th e estate.
The p artition of th e half, th e three-fourths, o r th e whole of a suc­
cession falling to brothers and sisters as above set forth, is m ade equal
If they are of th e sam e m arriage, if of different m arriages th e succession
u eaually divided between th e paternal and m aternal lines of the
deceased. If deceased died w ithout descendants, leavm g neither
brothers nor sisters, nor descendants from them , nor m other nor
father nor ascendants in th e paternal or m aternal lmes, his succession
oasses’ to his o th er collateral relations, th e one nearest in degree
excluding th e others. W hen th e deceased has left, neither lawful
descendants nor lawful ascendants, nor collateral relations, th e law
„alia to his inheritance either th e surviving husband or wife, or his
or her natu ral children, or th e S tate. I f natural m other left no
lawful children or descendants, her natural children, acknowledged
bv her. in h erit to th e exclusion of her father and -mother and other
ascendants or collaterals of lawful kindred. N atural children inherit
from th eir natu ral father, who has acknowledged them , when he has
left no descendants nor ascendants, nor collateral relations, nor
surviving wife, an d to th e exclusion only of th e State. D onations
inter vivos or m ortis causa cannot exceed tw o-thirds of th e property
of th e disposer if he leaves a t his decease a legitim ate c hild, one-half
if he leaves two children, and one-third if he leaves three or more.
If he leaves no descendants b u t a m other or father or both, cannot
exceed tw o-thirds. I f a brother or sister or both as well, cannot exceed
three-fourths. T he rem aining th ird or fourth, as th e case may be
Is the legitime of th e fath er or m other. Exem ptions: $5,000 for direct
descendant, ascendant, or surviving spouse, $1,000 to collaterals, $500
to strangers. T ax: 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 $5 000 to $50,000, 10 per cent above $5,000. Bequests to edu­
cational, religious or charitable institutions are exem pt. Inheritance
tax n o t due when property inherited, bequeathed or donated shall
have borne its ju st proportion of taxes prior to tim e of such donation,
beauest, or inheritance. R. C. C. 915 am ended to read, In all cases
when either husband or wife shall die leaving no descendants, nor
father nor m other w ithout having disposed by last will a n d testam ent
of his or her share in th e com m unity property, such undisposed or
share shall be inherited b y th e survivor in full ownership. I f deceased
spouse leaves fath er or m other, or both, and surviving spouse, onehalf of deceased’s share of com m unity goes to father and m other or
survivor of them and one-half to suryiving spouse.
D ivorce. (See Separation from Bed and Board.)
D ow er. (See M arried Women.)
E m p lo y ers L ia b ility A ct. T here is a general Em ployers Liability
Act in th e S tate setting forth special com pensation for various injuries.
E x e c u tio n . P ro p erty taken under a w rit of fieri facias m ust be
advertised an d appraised, and can not be sold for less th an tw o-thirds
of the appraised, value, u ntil it has been re-advertised. Advertise­
ments of m ovables th ree tim es in ten days—of real estate once a
week for th irty days. I f tw o-thirds of appraised value is n ot bid,
property m ust be re-advertised for fifteen days, and sold on a credit
for twelve m onths for w hatever it will bring. T here is no redem ption
of property sold under execution or m ortgage. No stay of execution
is given except on appeal, and execution m ay issue a t any tim e after
the delay for appealing suspensively has expired. Act 113 of 1906
authorizes sheriffs and constables to p u t purchaser of seized property
in possession.
E x e m p tio n s. T o head of family, real estate is owned and occupied
as a residence, together w ith certain furniture, stock, implements,
provisions, etc., th e property n ot to exceed $2,000, m eans or property
of wife deducted from exem ption Of husband. I f th e property exceeds
$2,000 in value, it m ay be sold. Beneficiary entitled to $2,000 of
proceeds. N o registry, required in parishes other th a n Orleans.
Surviving spouse or m inor _hild or children m ay claim benefit or this
exemption. Widow or m inor children surviving is entitled to $1,000
of out deceased h u sb an d 's estate, if in necessitous circum stances, by
preference over even a first-m ortage creditor. Sheriff or constable can
not seize linen an d clothes of debtor or his wife, nor his bed, nor those
of his fam ily, nor his arm s and m ilitary accoutrem ents, nor tools and
instrum ents and books, sewing m achines necessary for th e exercise of
his or h er calling, trad e, or profession, by which he m akes aliving, the
right of personal servitude, of use and habitation, of usufruct to the
estate of a m inor child, th e income of to tal property, m oney due for
salary of an officer, wages or recompense for personal service (laborers
wages) cooking stove, plates, etc,, fam ily portraits, musical instru­
ments played on by fam ily. (Acts 1876, No. 79.)
F ra u d vitiates all contracts. Action barred by one year lim itation
to annual sale on account of fraud. F or fraud on p a rt of purchasers
of goods see Act 114 of 1912 am ending Act 94 of 1896.
G a r n is h m e n t. W ages earned out of th is S tate and payable out
of this S tate, shall be exem pt from attachm ent or garnishm ent m all
cases where cause of action arose out of this S tate, and it shall be the
duty of garnishees in such cases to plead such exemptions unless the
defendant is actually served w ith process. (Act 165 of 1904.) (See
Attachment.)
H o lid ay s. Sundays. January 1st, Ja n u ary 8th, F ebruary 22d,
Good Friday, Ju n e 3rd, to be known as C onfederate M em orial D ay ,
July 4th, th e first M onday of Septem ber, to be known as L abor D ay,
October 12th, Christopher Columbus Day, Novem ber 11th, T hanks­
giving Day, as designated by the P resident of th e u n ited States.
December 25th, an d all general election days, w hether Presidential,
Congressional, S tate, municipal or parochial, in th e localities where
said elections are held; and in th e parish of Orleans, M ardi Gras, and
in cities or towns where th e population exceeds 10,000. Saturdays
from twelve o’clock noon to twelve o’clock m idnight, to be known as
a half holiday.
H u s b a n d a n d W ife. (See M arried Women.)
I n te r e s t. Legal rate is 5 per cent, b u t 8 per cent m ay be agreed
upon in w riting. If higher th a n 8 per cent is charged, it is reducible
to 8 per cent. I f paid, it m ay be sued for and recovered w ithin two
years.
J u d g m e n ts recorded in the office of th e parish recorder become
mortgages from d ate of record upon all real estate of th e debtor, and
may be th u s recorded in any parish where debtor owns real estate.
They are valid for ten years, when th ey m ust be renewed.
L ien s o r P riv ileg es. T he following have special privileges, v iz.:
1. Lessor's privilege. 2. Privilege of th e creditor on th e thing
pledged. 3. ’ Privilege of a depositor on th e price of a thm g deposited.
4. Privilege for expenses incurred in preserving thing. 5. Privilege
of the vendor of m ovable effects so long as th ey are in th e possession
of the vendee. 6. Privilege of th e innkepeer on th e effects of the
traveler. Privileges resting upon im movables are as follows, v iz.:
1. The vendor on th e estate by him sold, for th e paym ent of the
price or so m uch of i t as is unpaid, w hether it was sold on or w ithout
a credit. 2. Architects, undertakers, bricklayers, painters, m aster
builders, contractors, sub-contractors, journeym en, laborera, cartmen, an d other workmen employed in constructing, rebuilding, or
repairing houses, buildings, or m aking other works. 3. Those who
nave supplied th e owner or other person employed by th e owner.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1749

his agent, or sub-contractor, w ith m aterials of any kind for the construction or repair of an edifice or other work, when such m aterials
have been used in th e 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 th e U nited S tates has a five days
privilege for unpaid purchase price in preference to au others. P rivi­
lege granted employes in saw mills, etc. (Act 145 of 1888, am ended
by Act 52 of 1910 and Act 23 o f 1912. W idow and children left in
necessitous circum stances are entitled to an am ount in husband s or
fath er’s succession sufficient to m ake $1,000 inclusive of property
already possessed by them . T his privilege primes all others except
vendor’s privilege, th a t for expenses of selling property and con­
ventional m ortgages, representing money actually loaned for n ot less
than one year as n ot exceeding 6 per cent for interest, discount and
charges.
L im ita tio n s t o S u its .
P rescription— Accounts stated and
acknowledged in writing are prescribed only by ten years. (Act or
1888.) Personal actions one year. Action for to rts of all kinds; for
injury to or non-delivery of m erchandise 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 m onth. T hree years: Action for arrearages of rent
charges, or hire of movables or im movables or m oney 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 m erchants, w hether wholesale or retail, and others. Four
years: Actions by minors against their tutors, counting four years
from m ajority. Five y e a rs: Action on bills of exchange or promise
sory notes, counting from m aturity, and for nullity of contracts or
wills: for recision of partitions; to set aside public and_judicial sales
for informalities. Ten years: All other actions; th e right to a-usu­
fruct or servitude, all judgm ents; w hether rendered within or w ithout
the State, b u t judgm ents m ay be revived before lapse of ten years,
and are then good for te n years from date of revival. g Prescription of
ten and th irty years now runs against minors, interdicts and jnarried
women (Act 161 of 1920). H usband and wife can not prescribe
against each other. Prom ise to pay or paym ent on account will
Interrupt prescription. Only w ritten promise to pay. will revive
when prescription has accrued..
L im ite d P a r tn e r s h ip s . (See Partnership.)
M a rrie d W o m e n . Act 94 of the Legislative Session of 1916 pro­
vides th a t a m arried woman of this S tate shall be com petent to con­
tra c t and bind and obligate herself personally and w ith reference to
her separate and paraphernal property, and to appear in C ourt and
to sue and be sued to the same extent and in th e same m anner as
though she were a femme sole: orovided th a t nothing herein con­
tained shall be deemed or construed to affect in any way th e sta tu tes
of this S tate, establishing and regulating th e m atrim onial com m unity
of acquets and gains, , and prescribing w hat shall be deem ed com­
m unity and w hat be deem ed separate property of th e o th er spouse.
This act does not perm it wife to contract w ith husband, or pledge her
property or otherwise obligate herself for th e benefit Of her husband.
Revenues of all separate property adm inistered by the husband, and
all property acquired by either husband or wife after m arriage, except
by donation or inheritance constitute p a rt of community, unless
bought w ith th e separate m eans of either and as a separate acqui­
sition. Wife has no dower in h er husband’s real estate. T he wire
can have no claim upon th e property of th e husband to th e prej­
udice of th ird parties, unless recorded. W here one of th e spouses
is agent for th e other, he or she m ay be witness for th e other in a
m atter connected w ith th a t transaction, otherwise husband or wife
cannot testify in favor or against th e other even though both litigants
consent. A fter dissolution of m arriage by death or divorce th e sur­
vivor is entitled to one half of all property rem aining after paym ent
of debts, acquired during m arriage, and in case of death, if th ere is
i«sue, the usufruct of th e 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.” )
M o n o p o lies o r T ru s ts are regulated and rights are given against
them sim ilar to those existing under Federal Law. T he sta te author­
ities m ay tak e action and th e individual m ay recover threefold damages
sustained. See House Bills Nos. 7 and 8, extra session 1915, approved
June 10, 1915.
.
M o rtg a g e s can be foreclosed a t any tim e after m atu rity of th e
debt, by instituting a regular suit and obtaining judgm ent thereon, or
If th e act im ports a confession of judgm ent in favor of th e .holder, he
can apply to th e coun, for an order directing th e sheriff to seize and
sell th e property. All m ortgages m ust be recorded before th ey can
have any effect as against th ird parties. T rust deeds are n ot legal,
except as provided under “ T ru sts.” T here is no redem ption of property sold under m ortgage. All ta c it m ortgages have been abolished
since 1870. In m aking sales or giving a m ortgage upon his property,
it is n o t necessary for th e husband to obtain th e signature of th e wire.
A m ortgage resulting from recording a judgm ent cannot have th a t
effect u ntil after adjournm ent of court. [Act 1888.1 Lessees obligated
to erect buildings, etc., upon leased property, can m ortgage th e lease,
together w ith th e im provem ents, etc. [Act 21 of 1908.} Leases and
contracts to explore for oil, gas and m inerals m a y be mortgaged.
[Act 232 of 1910.1
N eg o tia b le I n s t r u m e n t s . “ Negotiable Instrum ent A c t” (No.
64 of 1904) changes in m any respects th e laws form erly applicable to
hills and notes. U nder it, days of grace, which form erly were custom ­
ary are abolished. Instrum ents are payable to bearer if m ade payable
to the order of a fictitious or non-existing person, when such fact is
known to th e one m aking it so payable; when nam e of payee does
not p u rport to be nam e of any person; or when the only or last indorse­
m ent is in blank. W hen there is a discrepancy between th e words
and th e figures of an instrum ent, th e sum denoted by th e words is
the sum payable. Two or more persons signing instrum ent contain­
ing words, “ I prom ise to pay,” are jointly and severally liable thereon.
P resentm ent for paym ent is unnecessary to bind p arty primarily
liable, b u t is necessary to charge draw er or indorser. N otice or dis­
honor m ust be given to draw er and indorser When instrum ent has
been dishonored by non-acceptance or non-paym ent, otherwise th ey
are discharged. A bill of exchange does not operate an assignment
of funds in hands of drawee available for paym ent thereof, and drawee
is n ot liable till he accepts same. H older m ay require acceptance
to be w ritten on bill, and if refused, m ay tre a t th e bill as dishonored.
An acceptance w ritten on paper other th an a bill, and an uncondi­
tional w ritten prom ise to accept a bill before it is drawn, binds th e
acceptor only in favor of a purchaser for value on faith thereof.
Drawee has tw enty-four hours to decide w hether he will accept or
not. A drawee who destroys a bill presented to him for acceptance,
or who fails to retu rn th e bill w ithin tw enty-four hours, is deem ed to
have accepted th e sam e. W here a signature is so placed upon a
negotiable instrum ent th a t it is n o t clear in w hat capacity th e person
making same intended to sign, he is deem ed an indorser. Foreign
bills m ust be protested for non-acceptance or non-paym ent. W here
a bill does not appear on its face to be a foreign bill, protest thereof
In case of dishonor is unnecessary. A check m ust be presented for
paym ent w ithin a reasonable tim e or draw er will be discharged from
any loss caused by delay. Bank is not liable to holder of a check
until it accepts or certifies sam e. W hen th e last day to do an act
reauired or perm itted to be done under the act falls on a Sunday or
legal holiday, it m ay be done on th e next succeeding secular or busi­
ness day. W hen day of m atu rity falls on a Sunday or a holiday, th e
instrum ent is payable on next succeeding business day. Instrum ents
falling due on Saturday are to be presented for paym ent on next
succeeding business day, except th a t instrum ents payable on dem and
m ay, a t option of holder, be presented for paym ent before 12 o clock
noon on Saturday when th a t entire day is n o t a holiday. If the day
or days next succeeding the protest for non-acceptance or non-pay-

1750

B A N K IN G A N D C O M M E R C IA L L A W S— M A IN E

m ent shall be days of public rest or legal holidays or legal half holi­
days, th en th e day next following shall be com puted as the first day
after th e protest. “ Service of citation shall not be waived, nor judg­
m ent confessed, b.v any docum ent under private signature executed
rior to th e m atu rity of th e obligation sued on.” Acceptance m ust
e in w riting and signed by drawee. I t m ust n ot express th a t drawee
will perform his promises by any other m eans th an paym ent of money.
[Act 189 of 1908.]
P a r tn e r s h ip , L im ite d a n d S p ecial. Stipulations th a t one shall
participate in th e profits and shall n ot contribute to losses is void,
both as regards p artners and th ird persons. P artnerships are divided
as to th eir object into commercial and ordinary partnerships. Com­
mercial partnerships are such as are form ed: 1. E'er the purchase
of any personal property, and th e sale thereof either in the same
sta te or changed by m anufacture. 2. For buying or selling any
personal property w hatever, as factors or brokers. 3. For carrying
personal property for hire, in ships or other vessels. Ordinary p a rt­
nerships are all such as are n ot commercial. T here is also a species
of partnership which m ay be incorporated w ith either of the other
kinds, called partnership in commendam. I t is formed by contract,
by which one person or partnership agrees to furnish another person
or partnership a certain am ount, either in property or money, to be
employed by the person or partnership to whom it is furnished, in
his or th eir own nam e or firm, on condition, of receiving a share in
th e profits, in the proportion determ ined by the contract, and of being
liable to losses and expenses to the am ount furnished and no more.
P artn er in commendam cannot bind other partners by his act. P a rt­
nership in com m endam m ust be m ade in w riting; m ust express am ount
furnished or agreed to be furnished; th e proportion of profits which
p artn er is to receive and expenses and losses he is to b e a r ; m ust sta te
w hether it be received in goods or money, e tc .; m ust be signed by
parties in presence of a t least one witness and recorded in full within
six days in m ortgage office. I f branch houses are established the con­
tra c t m ust be recorded in parish where branches are located. If
p artn er in com mendam allow his nam e to be used, or if he take any
p a rt in th e business of the partnership, he will be liable as a general
partn er. Ordinary p artners are n ot bound in solido for debts of
p artn ersh ip ,,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 th e num ber of partners. Commercial partners are
each liable for the entire debts of th e partnership.
P o w ers o f A tto rn e y , M ay be w ritten or oral. M ay be either
general for all affairs or special for one affair only. One conceived in
general term s confers only power of adm inistration; to sell m ortgage
or do an y o ther a c t of ownership, th e power m ust be express and
special.
P ro b a te L aw . T here is no special probate court. D istrict courts
are vested w ith probate jurisdiction. Successions are opened upon
petition of interested persons in th e parish where the deceased resided,
if he had a domicile or fixed place of residence in th e s ta te ; in th e parish
where he left his landed property, if he had neither domicile nor
place of residence in the sta te ; or in th e parish in which it appears
from th e inventory th a t his principal property was situated, if he
left property in several parishes; in th e parish where he died, if he
had no certain domicile nor any fixed property. If presum ptive heir
does not begin legal proceedings to settle succession within ten days
after d eath of “ de cujus,” creditors m ay dem and th a t he sta te whether
he accepts or rejects succession, or if no heirs appear, th a t a curator
ad hoc be appointed to settle th e estate. T he judge appoints an
adm inistrator when deceased leaves no will. A dm inistrators m ust
render annual accounts, and are allowed 2
per cent on the inven­
to ry as commissions. A ttorneys a t law are appointed to represent
absent heirs. Properties acquired during m arriage are presum ed to
be com m unity property, and surviving spouse is owner of one-half.
W hen eith er husband or wife dies, leaving no ascendants or descend­
ants, and w ithout having disposed b y will of his or her share in the
com m unity, th e survivor holds such share in usufruct during his or
h er n atu ral life. (See Successions.)
P r o te s t. (See N egotiable Instrum ents.)
S e p a r a tio n f ro m B ed a n d B o a rd . M ay be claimed reciprocally
for: 1. A dultery. 2. W hen spouse condem ned to infamous pun­
ishm ent. 3. /H abitual intem perance, excesses, cruel treatm ent, or
outrages, when such renders living together insupportable. 4. Public
defam ation ‘of one spouse by th e other. 5. Abandonm ent. 6.
A ttem p t of one spouse against life of other. 7. W hen one spouse
charged w ith infam ous offense actually flees from justice. Divorce
m ay now b e obtained if both parties have lived separately for seven
years.
Judgm ent of D ivorce. “ A vinculo m atrim onii” can be obtained
im m ediately for first two causes. F or other causes it is necessary
first to obtain judgm ent of separation “ a m ensa e t thoro.” After
judgm ent o f separation from bed and board, if there has been no
reconciliation, p a rty in whose favor judgm ent is rendered can obtain
final divorce one year after finality of judgm ent of separation. P arty
against whom judgm ent is rendered m ust w ait two years. When
m arriage is celebrated outside of sta te parties cannot obtain divorce in
sta te on grounds occurring outside of state.
T axes. Taxes on real estate cannot be enforced until th e expira-'
tion of th e y ear for which th ey are levied and after legal notices to
delinquents and advertisem ent. L ands sold for taxes are redeemable
w ithin one year, by th e owner, his agent, or heirs, or any creditor,
on paym ent of th e purchase money, w ith 20 per cent interest and
costs, and all subsequent taxes paid. Lands sold for taxes due prior
to 1880 are not redeemable. S tate taxes are 5 M mills on actual value,
parish taxes n ot exceeding 4 mills. C ity of New Orleans taxes are
23 K mills on 90 per cent, of actual value, other municipal taxes not
to exceed 7 mills. D elinquent sta te taxes bear interest a t 2 per cent
a m onth, city taxes, 10 per Cent a year.
W ills. T here are four different kinds of wills, viz.: T he olo­
graphic, nuncupative by public act, nuncupative by private act, and
m ystic (or sealed) will. T he olographic will m ust be wholly w ritten,
dated, and signed by the testa to r, and m ay be m ade w ithin or w ith­
out th e S tate. N uncupative will by public act as w ritten by a notary
in presence of three witnesses, over the age of 16 years complete,
n o t insane, deaf, dum b or blind, residing in th e place where will
is executed, or five witnesses not residents of the place, a t th e dictation
of th e testato r. N uncupative will by private act and m ystic wills
are subject to m any form alities which m ay be best obtained by refer­
ence to Civil Code Arts, 1581-1587 both inclusive. All persons
of sound m ind over sixteen years of age m ay dispose of their property
b y will. Wills executed w ithout the sta te given force and effect
provided sam e be in w riting and subscribed by testa to r and follows
form of place where executed, or of te sta to r’s domicile. (See act 176
of 1912.)
T r u s ts . Act 107 of 1920 perm its donations inter vivos or m ortis
causa to be m ade whereby individuals or S tate B ank and T ru st com ­
panies or banks organized under Federal laws m ay be m ade trustees
These tru sts to last not longer th a n 10 years after death of donor
unless th e cestui is a m inor, a t death of donor, in which case th e y may
last till 10 years after his m ajority. T he legitime m ay th u s be ad­
m inistered in tru st.

g


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

S Y N O P S IS OF

THE LAW S OF MAINE
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised b y P u l s i f e r & L u d d e n ,
68 M aine St., Auburn, Me.
(See Card in A ttorneys’ List.)
A c k n o w le d g m e n ts. (See Deeds.)
A ctio n s. A t law begun by writ, under common law practice, but
containing declaration. Suits in equity are begun by bill of com­
plaint, filed with clerk of court and subpoena issued by him, or may
be inserted in w rit of attachm ent 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, m ade before
a N otary Public, m akes a prim a facie case.
A d m in is tr a tio n of E s ta te . (See E states of Deceased Persons.)
A ffidavits. Affidavits m ay be m ade before a notary public or
justice of the peace. In some court m atters autho rity of magistrate
m ust be proved by certificate, of clerk of a court of record.
A liens. Aliens m ay hold and convey real estate and personal
property. Wills of aliens m ay be proved and allowed in this State.
Widow of a citizen of U nited States who was an alien when she married
him has right of descent in his estate (but see M arried Women).
A r b itra tio n . Judge of probate court m ay authorize executors or
adm inistrators to adjust by arbitration claims for or against the
estates reprasented by them . All controversies which m ay be the
subject of personal action m ay be subm itted, by th e parties, to referees
for arbitration. M ajority of referees m ay m ake report to Supreme
or Superior Courts.
A rre s t. (See Executions.) In actions ex delicto, on mesne proc­
ess and execution, as of course w ithout affidavit or order; in actions
ex contractu, on mesne process, upon affidavit of th e creditor, his
agent, or attorney, th a t he has reason to believe and does believe
th a t the debtor is about to depart and reside beyond th e limits of
the S tate and carry w ith him m eans of his own more th an are neces­
sary for his im m ediate support, and th a t a t least $10 is due on the
claim; on execution, only after supplem entary proceedings and fraud
proven, b u t if contract judgm ent or action existing M arch 17, 1887,
arrest on execution. D ebtors arrested on mesne process or execution
m ay disclose, give up property not exem pt from attachm ent and be
discharged from arrest, or m ay give bond and disclose according to its
term s. No arrest in actions ex contractu for less th an $10, and none
of m arried women in civil actions.
A s sig n m e n ts. Common law assignm ents for th e benefit of
creditors m ay be m ade, and after four m onths will be good against
bankruptcy proceedings. Assignments of wages m ust be recorded
in town clerk’s office.
A tta c h m e n t. All property n ot exem pt attachable on mesne proc­
ess as of course w ithout affidavit; security for costs by indorser of
writ only if creditor is non-resident; lien by attachm ents in th e order
in which they are m ade continue for th irty 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 tim e levy m ay be m ade. Personal property m ay be appraised
and sold on mesne process to avoid expense, depreciation or loss,
on request of either p arty and proceeds held by officer in lieu of the
property, foreign attachm ent (garnishm ent), known as trustee process,
attaches property by or debt due from trustee unless: 1. Due on
negotiable paper. 2. M oney collected on process by officer. 3.
In hands of public officer. 4. Due on contingency. 5. Trustee
liable to execution on sam e. 6. T w enty dollars wages, for personal
labor of the debtor, wife or m inor child w ithin one m onth, and $10
exem pt in all cases. 7. In certain cases money due on life and
accident policies, and from fraternal beneficiary associations. (See
Creditors Bills.)
B a n k s. Savings bank business and discount banking permitted
only under special charter, and under sta te supervision. T rust com­
panies m ay be organized under general sta tu tes on obtaining approval
of sta te bank examiner. General sta tu tes relating to discount bank­
ing repealed by Laws 1903, c. 166. Foreign banking associations hav­
ing a branch here p ay a tax of three-fourths of one p er cent per annum
on the am ount of business done in th is S tate. Savings banks have
no capital, and do business only for th e benefit of depositors, under
sta tu te regulations restricting investm ents, requiring reports under
oath and exam inations by bank examiner. M ust n o t pay over 2 1-2
per cent dividend semi-annually. Franchise tax is five-eighths per
cent, regulated to favor home investm ents. Use of th e words “ bank.”
“ tru st com pany,” and sim ilar words in designating a business, for­
bidden, except by corporations organized as above or under laws of
U nited States, Corporations, if licensed b y bank commissioner may
receive savings deposits from their employees. Dealers in securities
m ust be registered w ith bank commissioner and are subject to certain
regulations.
C o lla te ra ls. (See M ortgages.)
C o n d itio n a l S ales, C o n s ig n m e n ts . No agreem ent th a t personal
property bargained and delivered to another shall rem ain th e property
of the seller until paid for, is valid unless in w riting and signed by the
person to be bound. Such agreem ent, in w hatever form it m ay be,
Is not valid except as between original parties, unless recorded in the
office of th e clerk of th e town in which the purchaser resides a t the
tim e of th e purchase. T his does n ot apply to goods consigned for
sale.
C o n v e y an ces. (See Deeds.)
C o rp o ra tio n s . T hree or more persons m ay form a corporation to
carry on any lawful business excepting banking, insurance, construct­
ing and operating railroads, savings banks, tru st companies, or cor­
porations intended to derive profits from th e loan or use of money,
and safe deposit companies, b u t corporations m ay be formed under
the general law for the construction and operation of railroads ourside
the S tate of M aine. Corporations for other purposes, excepting for
municipal purposes, and where th e objects of th e corporation can not
be attained w ithout special acts, are also formed under general laws.
Organization becomes void unless corporation begins business within
two years. C orporation m ay capitalize to an unlim ited am ount ana
m ay increase or decrease th e am ount of their capital or th e par value
of the shares. No portion of capital is required to be paid in; stock
m ay be issued for property or for services and in absence of fraud
the judgm ent of th e directors as to th e 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 m aintained only by a judg­
m ent creditor of th e corporation who shall have begun proceedings
to obtain such judgm ent against the corporation during the owner­
ship of such stock or w ithin one year after its transfer by such stock-

B A N K IN G A N D C O M M E R C IA L L A W S— M A IN E
bolder is recorded on th e corporation books. D irectors m ust be
stockholders or m em bers of another corporation which is a stockholder
Tfcorporation fails for six m onths to elect directors, court m ay appoint.
Corporations m ust p ay to th e S tate upon organization, a fee as fol­
lows- W here th e capital stock is $ 10,000 or less, $10; exceeding
110 000 and up through $500,000, $50; above $500,000, $10 for every
liob 000 of capital. O ther fees for organization are: attorneyrenerai's fee $5; register of deeds $5, secretary of sta te $5. T he
annual franchise tax is as follows: $5 provided authorized capital
does n o t exceed $50,000; exceeding $50,000 and up through $200,000,
HO- exceeding $200,000 and up through $500,000, $50; exceeding
$500,000 and up through $1,000,000, $75; and th e f ^ h e r sum of
150 per $1,000,000 or any p a rt thereof in excess of $1,000,000. Cor­
porations which have suspended business tem porarily and have been
excused from filing retu rn s of am ount of capital stock, etc., are not
liable for franchise tax. M eetings of stockholders m ust be held within
the State. Clerk m ust be resident and keep stockholders records in
the S tate. H is records are open to inspection by stockholders b u t
not by m ere creditors. W ith the exception of banking corporations
no public reports are required except one to th e secretary of stste
showing nam es and residences of officers and am ount of capital stock.
Delivery of certificate of stock to bona fide purchaser or pledgee for
value together w ith w ritten transfer of sam e or w ritten power of
attorney to sell, assign, and transfer sam e, signed by owner of cer­
tificate, transfers title against all parties. Foreign corporations have
Dractically sam e rights as domestic, b u t are required to file copy or
charter w ith secretary of state, also a copy of the by-laws, and are
also required under severe penalties to file certificate showing among
other things th e nam es of officers, am ount of capital stock authorized,
amount issued and am ount paid in; also m ust file certificate showing
any change in above particulars. Such corporations m ust also appoint
a resident of M aine, having an office or a place of business in the
state, to be its atto rn ey on whom process m ay be served in any. legal
oroceeding. Corporations m ay dispose of their franchises on m ajority
vote of th e stockholders; m ay sue and be sued, and have generally
the powers of individuals. Public service corporations are subject
to a Public Utilities Commission.
C o u rts. T erm s and Civil Jurisdiction. Supreme Judicial court:
Two or th ree term s a year in each county; unlim ited jurisdiction except
as specified below; full jurisdiction in equity; appellate jurisdiction
en banc on question of law, from trial term s and superior courts.
Superior courts: In C um berland C ounty except equity, real actions,
extraordinary legal rem edies and some others; exclusive jurisdiction
with exceptions to $500 and in divorce, concurrent jurisdiction above
$500; sits first Tuesday of every m onth, except June, July, and
August. Kennebec C ounty; exclusive jurisdiction, w ith exceptions
to $500; concurrent in habeas corpus and divorce; sits second Tuesday
of Januarv and first T uesday or April and Septem ber a t A ugusta;
second Tuesday of June and Novem ber a t W aterville. Androscoggin
County; exclusive iurisdictiou, with exceptions to $500; concurrent in
divorce; sits a t A uburn first Tuesdays of February, April, June,
October and December. C ourts of probate: Usual jurisdiction con­
current in equity of probate m atters. M unicipal courts and trial
justices: Exclusive jurisdiction of forcible entry and detainer and in .
other cases up to lim ited am ount; appeals to superior court where
established, and elsewhere to suprem e judicial court.
C red ito rs’ B ills. Bill In equity m ay be m aintained to reach
property of debtor which cannot be reached by 'process a t law, and
Is not exem pt from attach m ent; also property conveyed in fraud of
creditors and property secreted so th a t it is not reple\ iable.
Days o f G race. (See Negotiable Instrum ents.)
Deeds. Any owner of real e sta te having right of entry .m ay con­
vey it by deed. No estate g reater than tenancy-at-will can be created
except in writing. Deeds m ust be acknowledged by a grantor or
one of them or by atto rn ey in fact, executing the same, before a justice
of the peace, no tary public having a seal, or woman qualified to take
acknowledgments; outside th e S tate, and in th e United States, before
a clerk of a court of record having a seal, notary public, or commlssioner of deeds for th is S tate, and in a foreign country before a notary
public, or a consul or m inister of the U nited States, b u t if m agistrate
acting outside of S tate has no official seal, his authority and the
genuineness of his signature m ust be authenticated by the clerk of
a court of record in county where he resides. Unacknowledged deeds
cannot be recorded. N o special form of acknowledgment required.
Deeds m ust be recorded to be valid against parties w ithout notice of
the conveyance. Deeds m ust be under seal, b u t witness is not
required for validity although usual to have one. Leases for more
than seven years m ust be recorded. T rusts concerning real estate
can be created only in writing, except those arising by implication
of lawD ep o sitio n s. Depositions m ay be taken by disinterested justice
of the peace or notary public; m ay be taken when deponent is unable
through age, infirm ity, or sickness to atten d a t place of trial; when
deponent resides o ut of, or is absent from the State; when deponent
resides in town other th an th a t in which trial is to be held, etc. Depo­
sitions so taken m ay be used in all civil suits or causes, petitions for
partition of land, libels for divorce, prosecutions for th e m aintenance
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 m ay also be
I taken in applications for pensions, bounty, or arrears of pay under
any law of th e United States. C ourts m ay issue commissions to
take depositions o u t of th e S tate, or th ey m ay be taken o ut of State
by a justice, notary, or other person empowered, b u t in th e la tte r
case It is w ithin th e discretion of the courts to adm it or reject them .
D escent a n d D is tr ib u tio n o f P ro p e rty . (See E states of D e­
ceased Persons.)
Dower. Abolished by laws of 1895, chap. 157, taking effect as
to persons not then m arried, M ay 1, 1895; as to others, Jan. 1, 1897.
Wife or husband m ay bar th e right by inheritance to one-third or
one-half, as th e case m ay be, of realty by joining in th e other s deed,
or by sole deed, or by ante-nuptial settlem ent, or by jointure. E ither
refusing to join in o th er’s conveyance (or if incapacitated w ith no
guardian in th is state, o th er being a non-resident) m ay be barred of
inheritance upon application to suprem e judicial court and decree
after hearing. (See E states of Deceased Persons.)
E sta te s o f D ece ased P e rso n s . One year after notice of ap­
pointment allowed creditors to present claims and suit m ust be
begun and service of process m ade w ithin tw enty m onths after such
notice of appointm ent. Allowance to widow and m inor cmlciren,
made by court from estate. N on-resident executor or adm m istrator
must appoint atto rn ey . Tim e of dem and or notice extended for absent
creditor if fu rth er assets, b u t prior paym ents n ot disturbed thereby.
No adm inistration granted after tw enty years. T he real and personal
estate of a person deceased in testate (excepting wild lands conveyed by
him) being subject to th e paym ent of debts descends according to the
following rules: 1. I f he leaves a widow and issue .o n e -th ird to
the widow. I f no issue, one-half to th e widow. And if no kindred,
the whole to th e widow. And to th e widower shall descend th e same
shares in his wife's real and personal estate. T here shall likewise
descend to th e widow, or widower, th e sam e share In all such real
estate of which th e deceased was seized during coverture, and which
has not been barred, or released, as herein provided. In any event,
one-third shall descend to th e widow or widower free from the pay­
ments of debts. 2. T he rem ainder of which he dies seized^ and if
no widower, or widow, th e whole, together w ith all wild lands shall
descend in equal shares to his children, and to th e lawful issue of a
deceased child b y rig h t of representation. I f no child is living a t
the tim e of his d eath, to all his lineal descendants; equally, if
a r®
the same degree of kindred; if not. according to th e right of repre­


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1751

sentation. 3. I f no such issue, it descends to his fath er and m other
in equal shares. 4. If no such issue, or father, it descends one-half
to h is m other. If no such issue or m other, it descends one-half to
his father. In either case, th e rem ainder, or if no such issue, father
or m other, th e 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 m other. If no such issue,
m other, brother or sister, it descends to his father. In either case,
to th e exclusion of th e issue of deceased brothers and sisters. 6. i f
no such issue, father, m other, b rother or sister, it descends to his next
of kin in equal degree; when th ey claim through different ancestors,
to those claiming through a nearer ancestor, in preference to those
fiaiming- through an ancestor more rem ote. 7. When a m inor dies
unm arried, leaving property inherited from either of ms parents, It
descends to th e other children of th e same parent, and the issue of
those deceased; in equal shares if all are of the same degree of kindred;
otherwise, according to th e right of representation. 8. I f the.
intestate leaves no widower, widow or kindred, it escheats to the
S tate. An illegitimate child is an heir of its parents who interm arry;
also of its m other, also of its father, who adopts it or acknowledges
it before a m agistrate; and in any case where th e child is treated as
an heir it inherits from th e lineal and collateral kindred of th e parent,
and th ey from it. (See Wills.)
E x e c u tio n s Issue after tw enty-four hours from rendition of judg­
m ent. returnable in three m onths, 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 sam e and franchises
and personal property by sale; money and, by consent, circulating
notes applied directly. Real estate sold on execution m ay be re­
deemed in one year. A ttaching creditor m ay within forty-eight
hours after notice redeem personal property of debtor which Is subject
to m ortgage pledge, or lien; m ay also redeem real estate subject to
m ortgage or other lien. Special provisions for redem ption of certain
other special classes of property, such as buildings on leased lands,
franchises, etc.
E x e m p tio n s fro m A tta c h m e n t a n d E x e c u tio n . H om esteads,
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; fam ily portraits, bibles, school books
In use; S tate sta tu tes; library. $150; regular pew; cook stove and
Iron warming stoves; charcoal, twelve cords of wood, five tons an­
thracite coal, fifty bushels bitum inous coal, $10 w orth of lum ber
wood, or bark; produce of farm s till harvested; barrel of flour, th irty
bushels of corn and grain, potatoes for family, one-half acre of flax
and m anufactures therefrom for fam ily; tools of trade, and m aterials
and stock, $50; sewing machine, $100; pair working cattle, or p air
mules, or one or tw o horses, $300; hay to keep them ; harness for
each horse and mules, $20; horse sled or ox sled, $20; domestic fowl,
$50; two swine, one cow and one heifer, if no oxen, horse or mule,
two cows; ten sheep, their wool, their lam bs 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 m achine; fish­
ing boat of two tons; debtor m ay elect if he has more th an is exem pt.
Life and accident policies are exem pt from creditors, except any
excess of $150 per year prem ium paid within two years, except suits
for necessaries. (See A ttachm ent.)
F o re ig n J u d g m e n t. Action of debt lies on a foreign judgm ent
and record of it is prim a facie evidence of indebtedness. Is conclusive
except for fraud when given by court having jurisdiction of parties
and subject m atter.
F r a u d . U sual common law rules as to w hat constitutes fraud,
fraudulent representations, etc.; also sta tu to ry penalties for fraud,
cheats, etc. C ourt of equity has power to afford relief. S tatuto ry
provisions to prevent sale in bulk of p art or whole of stock of m er­
chandise in fraud of creditors.
F ra u d s a n d P e r ju rie s . N o action shall be m aintained upon any
contract to charge an executor or adm inistrator upon any special
promise to answer dam ages o ut of his own state; nor to charge
any person upon any special promise to answer for th e debt, default,
or misdoings of another; nor to charge any person upon an agree­
m ent m ade in consideration of m arriage nor to charge any person
upon any contract for th e sale of lands, tenem ents, or hereditam ents,
or of any interest therein; nor to charge any person upon any agree­
m ent th a t is not to be perform ed within one year from the m aking
thereof; nor to charge any person upon any contract to pay a deb t
after discharge therefrom under bankrupt laws of th e U nited States
or assignm ent or insolvent laws of th is S tate; unless th e promise,
contract, or agreem ent or some m em orandum thereof is In writing
and signed by th e p arty to be charged, or his agent. No action shall
be m aintained on a m inor’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 th e bargain, or in p a rt paym ent thereof,
or some m em orandum is m ade and signed by p arty charged or his
agent. C ontracts w hereby one becomes agent for sale of lands become
void in one year unless tim e for term ination definitely stated.
G a r n is h m e n t. (See A ttachm ent.)
H o lid ay s. Ja n u ary 1st. F ebruary 22nd, April 19th, M ay 30th.
July 4th, first M onday of Septem ber, December 25th, and days of
public fast or thanksgiving appointed by th e Governor and Council,
or by th e President of the U nited States.
H u s b a n d a n d W ife. E ach m ay hold and deal w ith property
individually, subject to right of descent in real estate. (See E states
of Deceased Persons.) H usband n ot liable for debts of wife con­
tracted before-m arriage, nor afterw ard in her own nam e, nor for her
torts. E quity C ourt has special jurisdiction of disputes between
husband and wife relating to p ro p e rty .; A fter petition to and decree
by probate court either m ay convey real property as i f sole, and other
is barred of all rig h t by descent where deserted w ithout ju st cause
or if actually living ap art for ju st cause, and desertion or living ap art
has continued one year.
I n t e r e s t . Six per cent or any other rate agreed upon in writing;
Judgments, sam e rate; accounts and debts n ot on tim e bear interest
from dem and. Special rate in tim e notes does not continue after
m aturity, unless so provided; nor after judgm ent in any case; no usury
laws. On loans for less th an $200, secured by m ortgage or pledge
of personal property, th e rate shall not exceed 3 per cent per m onth
for first three m onths, and 15 per cent per annum thereafter. Loans
negotiated in this sta te by agent of non-resident borrower with in ten t
to evade usury laws of sta te where borrower resides are voidable.
J u d g m e n ts . At law; by general order a t end of term on all cases
where verdict or default, unless stayed by proceedings for new trial,
or continued for judgm ent by plaintiff; in equity, only by decree
signed by justice. No lien except by virtue of attachm ent on mesne
process (q. v.) and where specially provided by law.
L ie n s. (Voluminous S tatu te Provisions, for Mechanics, M aterial
Men, H otel and Boarding-House Keepers, Stable Keepers, Agister,
etc.).
L im ita tio n of A ctio n s. Six years; d eb t on unsealed contract or
liability (except judgm ents); actions upon judgm ents o ut of s ta te or
court n ot of record; for arrears of ren t; of account, assum psit, or
case on contract or liability express or Implied; waste; trespass qu.
cl. and d. b. a.; replevin; case, except slander and libel. Four years,
against sheriff. Two years: assault and b attery , false im prisonm ent,
aianrier libel and penalty. One year: escape, scire facias an d on

1752

B A N K I N G A N D C O M M E R C IA L L A W S— M A R Y L A N D

recognizance. E ighteen m onths: stolen bonds an d coupons, except
by owner. T w enty years: w itnessed notes, bank bills, specialties,
real action, o ther judgm ent and all o ther personal actions. Suit
begun when w rit was m ade. Incapacity of plaintiff, d eath of either
p a rty before or within th irty days after expiration of tim e, fraudu­
lent concealm ent of action, absence from S tate when cause accrues
or residence o ut of th e S tate an d absence afterw ards, extends tim e.
Actions barred where both parties lived are barred here. New
prom ise m ust be in w riting or p a rt paym ent m ust be m ade, to extend
tim e. Against executors and adm inistrators, tw enty m onths after
Sling of affidavit of notice given of appointm ent of executor or adm in­
istrator, unless fu rth er assets o r claim n o t m atured. Against heirs
or devisees, one y ear after claim accrued; rem edy in equity, if n ot
prosecuted w ithin tim e lim ited and if w ithout culpable neglect.
L im ite d P a r tn e r s h ip . M ay consist of one or m ore general p artners and one or m ore special. Special shall contribute specific am ount
of capital or property a t cash value, and be n ot liable for debts beyond
th a t am ount. G eneral partn ers m ust tran sact th e business.
M a rrie d W o m e n have sam e rights and liabilities as to property
contracts and all suits as m en. W ife’s property n ot liable for her
husband’s debts, nor his liable for her prior debts, nor for others m ade
on h er credit. She m ay sue and be sued as if sole. M ay n o t be
p artn er of husband and n o t liable for fam ily expense except by express
promise. (See Arrest, also Dower, also E states of Deceased Persons,
also H usband an d Wife.)
M o rtg a g e s . Of real estate executed and acknowledged as deeds
and m ust be recorded as to th ird parties; convey fee w ith condition
of defeasance. Foreclosed w ithout possession by serving o r adver­
tising notice, or b y possession obtained peaceably, or by consent, or
b y suit. Redem ption in one year from notice or possession; power
o f sale m ortgages n ot authorized by s ta tu te and n ot m uch used.
Supreme court m ay authorize a m ortgage by a person in possession
of an estate subject to a contingent rem ainder, executory devise, or
power of appointm ent, and such m ortgage is binding on all parties.
C h attel m ortgages unless and until possession taken and retained by
m ortgagee to be good against th ird parties m ust be recorded in town
clerk’s office where m ortgagor resides when m ortgage is given; or, if
an y of m ortgagees are non-residents, th en in registry of deeds in
county where m ortgagee resides, when m ortgage is given. M ort­
gage on household furniture m ust sta te am ount of loan, interest
rate, and cost of procuring loan. Agreements, w hether in form of
note, lease, conditional sale, etc., or otherwise, th a t chattels bargained
and delivered shall rem ain property of seller till paid for, m ust be in
writing and recorded as chattel m ortgages; such m ortgages and notes
foreclosed by sixty days’ notice to m ortgagor or assignee of record,
or, if out of S tate, b y publication; redem ption in sixty days. Col­
laterals pledged on notes, etc., or for th e perform ance of anything,
after failure to pay or perform by th e pledgor, m ay be sold by th e
pledgee, he first giving w ritten notice to th e pledgor of th e proposed
sale, or if his residence is unknown, by publication of notice once a
week for three successive weeks in a new spaper in th e city or town
where th e pledgee resides, recording said notice and affidavit of service
of sam e in th e clerk’s office of city or tow n where th e pledgee resides,
an d after th e expiration of th e sixty days from th e tim e of said record­
ing.
N e g o tia b le I n s t r u m e n t s . D ays of grace abolished except as to
sight drafts. Falling due on Sunday or bank holiday payable and
presentable for paym ent on secular or business day next succeeding.
I f holiday falls on Sunday th en following M onday is deem ed bank
holiday. On notes payable a t fixed place on dem and a t or after a
tim e certain, no recovery unless dem and proved th ere before suits
usual dem and and notice to charge indorser; notarial protest proves
it; b u t one indorsing note a t inception before payee does is a m aker.
W aiver of dem and and notice, apceptance of bill, draft, or order m ust
be in w riting and signed. Recovery from indorser w ithout suing
m aker. R ate of dam ages on protested bills of 100 or m ore payable
in th is Country, 1 to 9 p er cent according to place. Negotiable paper
presum ed to be tak en I n paym ent of debt or liability for which it is
given, unless creditor would thus lose security he otherwise would
have had. Legal holidays are Ja n u ary 1; F ebruary 22; April 19;
M ay 30; July 4; first M onday in Septem ber; Thanksgiving; Christm as,
and Arbor D ay. I f note reads “ I prom ise to p a y ” all signers are
jo intly and severally liable.
P a r tn e r s h ip . Personal property of partnership, or interest of
p artn er therein, exem pt from attach m en t on m esne process, or seizure
on execution for any individual liability or such partn er; b u t is sta tu ­
to ry provision for reaching sam e after judgm ent. P artners in m ercan­
tile enterprise m ust file sworn certificate w ith city or tow n clerk
where business to be carried on, showing nam es and residences of
partners, n atu re of business and partnership nam e. (See Lim ited
Partnership.)
P o w ers of A tto r n e y . U sual common law rules.
P ro b a te L aw . (See E states of Deceased Persons.)
P r o te s t. (See N egotiable Instrum ents.)
R e p le v in . Goods or chattels wrongfully tak en or detained m ay
be replevied by owner or p a rty entitled to possession. Replevin bond
m ust be double th e value of property replevied. I f dismissed w ith­
o ut tria l, suit m ay be brought on th e bond, in which su it title m ay be
shown to m itigate damages.
T axes m ay be collected b y arrest, distress, or suit. On real estate
th ey are a lien; proceedings to enforce by sale begin upon non-pay­
m en t for nine m onths; non-resident owners have one year from sale
to redeem by paying tax, costs, and 10 per cent interest from day of
sale; residents, tw o years w ith 10 per cent interest from day of sale
on whole sum of tax and costs. L and on which taxes are unpaid,
sold on first M onday In F ebruary in year succeeding th e year in which
ta x was assessed; sale is of sm allest fractional p a rt of interest to one
who will pay taxes, interest, and costs therefor. S tate tax assessed
by board of sta te assessors on gross receipts of railroads and express
companies, and telegraph and telephone lines, collected by suit.
Corporations, o ther th an those especially provided for, p ay a franchise
tax of $5.00 if authorized capital does n ot exceed $50,000.00; of
$10.00 if capital does n ot exceed $200,000.00; of $50.00, if capital
does n o t exceed $500,000.00; of $75.00, if capital does n o t exceed
$1.000,000.00; and th e 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
p er cent, according to degree of relationship and am ount of bequest,
$500 exem pt in all cases, and $10,000 exem pt in case of certain near
relatives. Special exceptions and exem ptions from assessment, and
special provisions for taxing personal property situated here b u t
owned o u t of th e S tate. Real estate m ortgages exem pt. (See
Banks.)
W ages. W eekly paym ent required in m ost industries. (See
Assignments, A ttachm ent.)
W a re h o u s e R eceipts* H older deem ed tru e owner so far as to
give validity to contract for sale of m erchandise covered, or to protect
one acting on faith of such ownership; b u t one taking from agent as
security for antecedent d eb t gets no greater right th an agent. T itle
to property passed b y endorsem ent, b u t n ot in blank, to purchaser
or pledgee in good faith. P roperty in warehouse m ay be attached
as th a t of person nam ed in receipt, or of last endorsee shown by books
of warehouseman. Common law rules prevail generally.
W ills. Wills m ust be in w riting signed by th e testa to r, or a t his
request by some person in his presence, and subscribed^in his presence
by th ree witnesses in presence of each other, m ay be m ade by any
person of age and of sound m ind, and m ay dispose of all property.
Wills executed in another S tate or country according to laws thereof,


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

m ay oe proved and allowed in th is S tate in th e ' county where the
testa to r had his residence a t tim e of decease; if proved w ithout this
S tate (at his domicile), m ay be allowed in any county here where he
has property. W idow or widower m ay within six m onths waive
provision in will of deceased husband or wife and claim sam e share
m personal property as would have had in case deceased died intestate.
(B ut see H usband and Wife.)
N uncupative will m ust be reduced to w riting w ithin six days, or
proved b y testim ony w ithin six m onths, from tim e words spoken.
N o letters in such till fourteen days after decease of testato r. Not
effectual to dispose of more th a n $100.00 w orth of p roperty unless
proved by three witnesses who acted a t te sta to r’s request.

S Y N O P S IS OF

THE LAW S OF MARYLAND
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised by T . H

o w a r d E m b e r t , A ttorney a t Law, Baltimore.
(See C ard in A ttorneys’ List.)

I n g e n e ra l. B agby’s A nnotated Code (1911) and Supplemen­
ta ry Volume (1914) em brace th e Public General Laws of Maryland,
including those of th e 1914 session. B y sta tu te, th e Code of 1911
has been m ade evidence; special reference to sta tu tes in th e following
Is therefore unnecessary.
A c k n o w le d g m e n ts of conveyances of any interest in real or lease­
hold property for above seven years, m ay be m ade within the State,
and in th e county or city in which th e land, or an y p a rt of it, lies,
before a n otary public, justice of th e peace, a judge of th e orphans’
court, a judge or th e circuit court of any county, o r a judge of the
suprem e bench of Baltim ore city. I f w ithin th e S tate, b u t out of
th e county in which th e estate conveyed lies, th ey m ay be made
before a judge of any circuit court for th e circuit where th e grantor
m ay be, or before any judge of th e orphans’ court for th e city or
county in which th e grantor m ay be, notary public, or a justice of
th e peace; th e official character of th e justice m ust be certified by
the clerk of th e circuit court of th e county, or superior court of Balti­
more city, under his official seal, or any judge of th e suprem e bench
of Baltim ore city, if grantor be in B altim ore city. I f without the
S tate, th ey m ay be m ade before a notary public, a judge of any
court of th e U nited States, or of any sta te or territo ry court having
a seal, or a commissioner of deeds for this S tate. T he seal of the
officer or court to be affixed to th e certificate of acknowledgment
in all cases. I f acknowledged w ithout th e U nited States, th e acknowl­
edgm ent m ay be m ade before any m inister, consul general, vice or
consular agent or deputy, or a notary public, or a commissioner to
tak e acknowledgments for S tate of M aryland. N o separate examin­
ation of a m arried woman is required. Defective acknowledgments
cured. (See Conveyances.)
A c tio n s . T he form s of actions, which still savor of th e common
law are now very simple, any plain statem ent of facts constituting
a good cause of action being sufficient.
Am endm ent is allowed at
any tim e before verdict. E quitable defenses are now allowed to
be m ade in a court of law, although there are still law courts and
equity courts having different and distinct jurisdiction. Speedy
judgm ent Acts are in force in Baltim ore C ity an d in m any of the
Counties. (See Suits.)
A d m in is tr a tio n o f E s ta te s . T he orphans’ court o f th e counties
and th e orphans’ court of B altim ore C ity are th e courts of probate.
In cases where decedent left a will, letters are granted to executor
and executrix nam ed in th e will. In granting letters of administra­
tion, where decedent died w ithout leaving will, letters are granted:
1. T o widow or child or children; 2. G randchild; 3. Father; 4.
B rothers and sisters; 5. M other; 6. N ext of kin; 7. Largest creditor
applying for letters. In each class, m ales are preferred to females.
Bond is required w ith two sureties, or one of certain local surety
companies where authorized b y their charter to act as sole surety.
W hen testa to r requests in will th a t executor be excused from giving
bond, court only requires nom inal bond for am ount sufficient to pay
estim ated debts. Six m onths notice to creditors m ust be given by
publication before estate is distributed. Personal property must be
appraised, accounted for and distributed through th e orphans’ court
of th e county or c ity . in which decedent resided. All sales must
be authorized and ratified by th e orphans' court. B y Act of 1896,
Oh. 246, above provisions were m ade applicable to ‘‘estates of per­
sons absent and unheard of for above seven years.” This act has
been held unconstitutional. Re-enacted w ith am endm ents. (Acts
1908, Ch. 125.) T his act constitutional by decision of Court of
Appeals in case of Savings Bank vs. W eeks 110 M d. 78.
Afifidavlts. (See Acknowledgments.) No particular form neces­
sary, b u t w hoever can tak e an acknowledgm ent can tak e an affidavit.
Affidavits always required in a m ortgage as to th e bona fldes or
m ortgage consideration; and th e paym ent of ta x on annual interest
in certain counties. (See M ortgages.)
A liens. Aliens, n ot enemies, m ay tak e and hold lands, tenements,
an d hereditam ents acquired by purchase, or to which th ey would,
if citizens, be entitled by descent, and m ay sell, devise, or dispose
of th e sam e or transm it th e sam e to th eir heirs as fully and effectually
and in th e sam e m anner as if by b irth th ey were citizens of this State.
A r b itra tio n . D isputes between parties m ay be conducted by
any judge or justice of th e peace m utually agreed upon. Special
agreem ents for arbitration of such disputes to be valid. Parties may
be represented by an attorney, and aw ard of arb itrato r or arbitrators
to be a judgm ent, and court m ay give judgm ent an d issue e x e c u tio n
on th e aw ard. Act 1904, Ch. 671, provides a m eans for t h e s e tt le m e n t
of disputes between employers and employees by m ediation or volun­
ta ry arbitration.
A rre s t. N o arrest for debts in this S tate. In crim inal cases a
sentence m ay be passed, imposing a sum of m oney as a fine, ana
th en in lieu of paym ent by p arty , of fine imposed, h e is liable to
im prisonm ent.
A tta c h m e n ts for d eb t (See A ct 1890, Chap. 549), or for unliqui­
dated damages, either in contract or to rt, can be obtained m au
cases when the defendant is a non-resident or has absconded, affidavit
being first m ade by the plaintiff to th e correctness of his claim.nna
th e fact th a t the defendant is a non-resident or has absconded. Tney
m ay be also obtained in connection w ith an original process wuen
th e creditor or some one in his behalf shall give bond in' double tne
am ount of th e debt, w ith sureties to be approved by th e clerk, ana
m ake affidavit before th e clerk of th e court where th e su it is brougnj
th a t th e defendant is bona fide indebted to th e plaintiff in the sum
claimed, and th a t th e plaintiff knows or has good reason to believe
th a t th e debtor has absconded or is about to abscond from the Stm*or th a t th e defendant has assigned, disposed of, or concealed, or
is about to assign, dispose of; or conceal, his property, or some portion

B A N K IN G A N D C O M M E R C IA L L A W S — M A R Y L A N D
thereof, w itn in ten t to defraud his creditors, or th a t th e defendant
fraudulently contracted th e d eb t or incurred th e obligation; or th a t
the defendant, has rem oved or is about to remove his property, or
someportion thereof, o ut of this S tate, w ith in ten t to defraud creditors
and the attach m en t m ay be m aintained, although th e d e b t or obliga­
tion upon which th e action is brought m ay n ot have m atured, b u t
the date of th e m atu rity of th e d eb t or obligation m ust be set forth
in the affidavit (Act 1894j Ch. 648). A claim ant m ay have the
attached property released by filing a bond in double th e am ount
of the appraisem ent. Any kind of property or credits belonging
to the defendant, in th e plaintiff’s own hands or in th e hands of any
one else m ay be attached. T here is a special provision for capital
stock of a corporation. T he certificate itself m ust be seized. Credits
not due m ay be attached, b u t wages, hire or salary n ot due can
not be attached, an d 90 per cent or wages, hire, or salary due shall
always be exem pt. (Act 1908, Ch. 665.) Im prisonm ent for debt
is abolished. D efendant m ay be sued wherever he does business.
In addition to attachm ents against non-residents or absconding debtors
for debt (i. e., a liquidated sum ), as heretofore, attachm ents m ay
now be issued against such debtors in cases arising from contracts
when th e dam ages are unliquidated, and in actions for wrongs inde­
pendent of contract, b u t in such cases no attachm ents can be issued
until a declaration is filed setting o u t specially and in detail the
breach of th e contract com plained of or th e to rt actually com m itted,
verified by th e affidavit of th e plaintiff or some one in his behalf,
and until a bond shall be filed sim ilar to th e bond required in a ttach ­
ments for fraud. (Code A rt. 9.) All papers in attachm ent pro­
ceedings can now be am ended, as in any other actions a t law. (Act
1898, Ch. 44.)
B anks. T he Act of 1910, as am ended by th e A cts of 1912 and
1914, m ade im p o rtan t changes in th e banking laws of th is S tate.
The law now provides for th e appointm ent of a Bank Commissioner
with broad powers for th e exam ination of all banking institutions
in this S tate other th an N ational Banks and an annual report thereon
to the Governor. W henever capital is reduced by im pairm ent
commissioner m ay require Bank to m ake such deficiency good within
sixty days, an d upon failure to do so m ay take possession of property
and business of such in stitution and retain possession until affaire
are finally liquidated. T his also applies where th e business is con­
ducted in an unsafe or unauthorized m anner. T he requirem ents
for the incorporation o f such institutions are fully set forth in the
act. This a c t also provides for th e incorporation and supervision
by'the S tate of saving institutions and tru st companies. C hattel
loan companies are required to take o ut a license, pay a fee where
the loan is $300 or more, and inspected by th e S tate Banking D epart­
ment.
Blue S k y L aw . Em bodied in th e Acts of th e Legislature of 1920.
Chapter 552, adding an additional section to th e A nnotated Code,
known as 32A, section 11, 12, 13 and 14.
The act provides th a t if it shall appear to th e A ttorney General of
Maryland th a t th e issuance, sale, prom otion, negotiation, advertise­
ment of th e securities w ithin th e S tate of M aryland, by any person,
partnership or corporation, or Is employing or is about to employ
any device, scheme or artifice to defraud, or for obtaining money or
property b y m eans of any false or fraudulent pretense, representation
or promise, th e said A ttorney General m ay require said person, p a rt­
nership or corporation to file w ith him a statem ent in writing under
oath of all th e facts concerning th e same.
Section 14 provides th a t any person, partnership or corporation
having been served w ith an y order of th e A ttorney General, or having
knowledge of th e issuance of said order and while said order remains
in effect, either as originally issued or as modified, or shall execute or
carry on an y scheme or device against which said order has been
issued, or wilfully attem p ts to do so, shall be guilty of a m isdemeanor
and, upon conviction, shall be fined not more th a n $10,000 or im­
prisoned n o t more th an two years or be subject to both fine and im­
prisonment, in th e discretion of th e C ourt.
C o llaterals. T he conversion by any banker, broker, m erchants,
attorney, or agent of collaterals is m ade a misdem eanor. (See Code.
Art. 27. Sec. 93.)
C o n tra c ts . T he norm al condition of all persons is one In which
they are capable of m aking any contract. T he fourth and seventeenth
sections of th e S tatu te of F rauds are in force in M aryland. Acts 1900.
Ch. 362, m ake it no longer necessary to show th a t th e consideration
for a promise to answer for th e d eb t of another is in writing. A
citizen can n o t m ake a contract w ith an alien enem y during the
continuance of hostilities, b u t aliens, not enemies, m ay contract and
hold real property as fully as citizens. The later cases decide contract
of infants to be voidable and n ot void; and th ey are capable of
ratification by infants on arrival a t age of tw enty-one. T he contracts
of infants for necessaries are binding upon them . T he contract of
1 a lunatic is voidable and n ot void. T he s ta tu te provides th a t a
married woman m ay engage in business, contract, sue, and be sued
upon contracts and to rts, as if unm arried. (Acts 1898, Ch. 457.)
I All gambling contracts and contracts m ade on Sunday are void.
C onveyances. N o estate or title to an y property lying within
I this State, for an y period above seven years, shall pass or take effect
I unless th e deed conveying th e sam e shall be executed, acknowledged,
and recorded. (See Code, A rt. 21, Sec. 1.) E very deed of real estate
I shall be signed and sealed b y th e grantor and bargainor, and attested
1 by at least one witness. N o words o f inheritance necessary, b u t every
1 deed shall be construed to pass fee simple title unless th e contrary
j appear. A scroll w ith th e word “ se al” therein by way of a seal, is
I sufficient. A deed m ust be recorded within six m onths from date.
I in county or Baltim ore C ity, where land lies, b u t if recorded after
this, deed, while valid between parties, is invalid as to deeds to bona
I fide purchasers w ithout notice recorded prior thereto. A body
1 corporate m ust embody in th e deed itself th e appointm ent of an a tto r­
ney to acknowledge th e deed as and for th e corporate act of said
j corporation or have it acknowledged by th e President or Vice-Presi­
dent without such appointm ent. Vendors’ lien m ay be released in
j original deed or upon records where recorded. (Code A rt. 66, Sec. 31).
| Conveyances defectively executed m ade valid by Acts 1908, Ch. 105
| and Acts 1914, Ch. 259 and Ch. 421.
C o rp o ratio n s are organized under th e au th o rity of th e General
j Incorporation Law, completely revised. Act 1908, Chap. 240. Liberal
1 provisions are m ade for general incorporation: only exception (for
j municipal purposes) is in the constitution. All corporations (under
the general law) m ust pay a bonus tax of one-eighth of 1 per cent
1 upon its authorized capital stock and any increase. Corporations
have perpetual succession, m ay carry on business anywhere, m ay
issue bonds, and secure them by m ortgage of all property including
j franchises. Foreign corporations m ust file list of resident share­
holders, and am ount held. The corporation’s certificate m ust be filed
and $25 paid; annual renewal fee of $1 is charged. All corporations,
j not paying a gross receipt tax (a long enum eration), shall pay an
annual franchise ta x on th eir capital employed in this S tate, of 50
I cents per $1,000 b u t no less th an $25. I f capital is over $500,000
] then one-fourth of 1 per cent on th e dxcess to $5,000,000, etc. Section
99 of Article 81 of Code, am ended by providing for annulm ent of
Charter for non-paym ent of taxes. D om estic corporations m ay issue
all kinds of preferred an d common stock, and exchange sam e for stock
j or good will. Valuation in absence of fraud is conclusive. As to
Stock certificates, see “ Uniform Laws.”
Law amended by Chapter 596, Acts of 1916.
Chapter 318, A cts of 1918, provides th a t all corporations who shall
j refuse or neglect to pay franchise tax or ta x on capital stock for a
Period of tw o years, th e charter is annulled and forfeited.
Any corporation chartered by this S tate, which for a period of ten
«ays next preceding is w ithout one resident agent, whose nam e and
1 Post office address is given in charter or filed w ith S tate T ax Commis­
sioner, m ay be deem ed a defendant in an attachm ent in th e sam e
manner as non-residence, unless said corporation shall have been


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1753

incorporated under th e laws of this S tate prior to ju n e , 1916, and
have a t least one D irector, who is a citizen of th is S tate, actually resid­
ing therein.
C o u rts . T erm s and Jurisdiction. T he circuit courts in th e
counties have jurisdiction a t common law in cases involving more
than $50, and equity in all cases involving m ore th an $20. T hey
hold from tw o to four regular term s in each county a t which th ey
have a ju ry ; there are, however, interm ediate term s fixed by th e
rules, to which process m ay be m ade returnable. T he circuit court
and circuit court No. 2 of Baltim ore city have exclusive equity juris­
diction in th e city. T he superior court, th e court of common pleas,
and Baltim ore city court have conclurent common law jurisdiction
in cases involving more th a n $100. T he court of common pleas
has exclusive jurisdiction in insolvency, and th e crim inal court in
crim inal cases. T he orphans’ courts in Baltim ore city, and in th e
counties have probate jurisdiction. Justices of th e peace have
jurisdiction to th e am ount of $100. T he common law courts have
three term s in th e year, and rule days every m onth in th e year to
which process m ay be returnable. T he equity courts have six term s
In th e year, beginning th e first M ondays of January, M arch, M ay,
July. Septem ber, and Novem ber.
D e p o s itio n . W hen th e courts are satisfied, by affidavit or other­
wise, th a t th ere are m aterial and com petent witnesses residing w ith­
o ut th e S tate, th ey will direct th a t a commission be issued to tak e
the testim ony of such witnesses. T he commissioners are selected
by th e court, and m ust qualify before some person authorized to
adm inister an o ath in th e sta te where they reside. T he depositions,
duly certified by th e commissioners, shall be adm itted as evidence
a t th e tria l of th e cause, subject to th e sam e objections and exceptions
as th e sam e testim ony would be if th e witness had been personally
present in court and th ere examined. P arties have th e right to be .
present when th e testim ony is taken under th e commission, and
m ust receive reasonable notice of th e tim e and place. E xam ination
is restricted to th e parties and interrogatories and cross-interroga­
tories annexed to th e commission.. Testim ony of non-resident
witnesses can also be tak en upon proper notice, as provided by Sec.
17 of A rt. 35 of th e Code.
D e s c e n t a n d D is tr ib u tio n of P ro p e rty . As to descent, see
Code 1904, A rt. 46, and as to distribution. Code, 1904, A rt. 93.
An a tte m p t to abrogate the Buie in Shelley’s case has been m ade by
Oh. 144, Acts 1912. .
D ow er. T he common-law right of dower exists in M aryland, and
extends to equitable estates. B y act 1898, th e husband’s dower
was created; an estate of th e husband in his wifè’s estates of inheritance, exactly equivalent to th e wife’s dower in her husband’s estate.
A devise or bequest of real o r personal property to th e wife or husband
shall be construed to be in lieu of dower in lands or share of personal
estate, respectively, unless otherwise expressed in th e will. I f th e
widow or widower renounces form ally in writing, however, such
provision m ade for h er or him by th e will, w ithin six m onths after th e
g rant of adm inistration on th e estate of th e deceased husband or wife,
th e dower rig h t and th e share of personal property rem ain undisturbed.
(See M arried Women.)
E x e c u tio n s m ay issue and judgm ents m ay be renewed or revived
by scire facias a t any tim e w ithin twelve years from date of judgm ent
or from th e expiration of any stay, an a m ay be thereafter levied
on any property of th e defendant. In th e circuit courts for th e
counties th ere is a stay u ntil th e first T hursday of th e term succeeding
th e rendition of th e judgm ent, provided th e judgm ent is obtained
a t th e second term a fter th e defendant is sum moned. . T here is no
stay upon judgm ents rendered in th e courts of Baltim ore C ity or by
justices of th è peace in th e city or counties, b u t execution m ay issue
forthw ith. T he defendant m ay stay th e execution by superseding
w ith sureties for six m onths. Copy of docket entries of judgm ent
when recorded in another county m akes the judgm ent a Hen there.
(Act 1890, Ch. 314.)
E x e m p tio n s . N o hom estead law. W earing apparel, books and
tools (not k ep t for sale) and $100 of p roperty in addition, w hether
sam e consists of m oney, land, goods, or m oney payable as insurance,
benefit, or relief in th e event of sickness, h u rt, accident, or death,
are exem pt from execution, except on judgm ents for breach of prom ise
to m arry and seduction, n ot applicable to any b u t actual bona fide
residents of th is S tate. E quitable interests in personal property
can n ot be sold under execution, b u t m ay be levied upon, and th e
lien thus acquired m ay be enforced in equity. Choses in action m ay
be attached.
F o re ig n C o rp o ra tio n s . (See Corporations.)
F o re ig n J u d g m e n ts . Judgm ents of th e courts of o th er states
certified under the act of congress, are proper causes of action against
any person subject to th e process of th e courts of th is S tate.
F ra u d . W hen any false representation is m ade by one to another
w ith th e in ten t to defraud, and th e defrauded p arty, thinking th e
alleged fraud to be truè, acts upon it, any contract thus m ade can
not be enforced. B u t if th e injured p a rty knows such representations
to be false, it can n o t be said to have influenced his conduct. F or
general doctrine in th is S tate see M cAleer vs H orsey 35 M d. 439.
Giving checks or d rafts w ithout provision for acceptance is prim a
facie evidence of in ten t to defraud, and is punishable as a crim e
unless such provision is m ade within te n days. E very person buying
m erchandise in bulk shall dem and and receive from th e vendor a
w ritten statem ent under oath containing th e nam es and addresses
of all creditors w ith am ount of indebtedness a t least five days before
the sale is consum m ated. T he vendee a t least five days before
consum m ating such sale shall notify all of said creditors either per­
sonally or by registered m ail of such proposed purchase. A sale
or transfer of goods in bulk w ithout such notice shall as to all sub­
sisting creditors of th e vendors be void.
C hapter 370, A cts of 1916, adds additional section to Article 27 of
B a g b y s Code and provides th a t if any person shall m ake, or cause to
be m ade, either directly or indirectly, through any agency, whatsoever,
any false statem ent as to his financial condition for th e purpose of
procuring th e delivery of personal property, etc., shall be guilty of a
m isdemeanor and be fined n ot more th an $1,000, or im prisonm ent for
one year.
C hapter 371, of th e Acts of 1916 adds new section 831 of Bagby’s
Code and provides th a t any vendor of stock of goods who shall know­
ingly and willingly m ake or deliver any statem ent of which any
m aterial portion is false, shall be guilty of a misdem eanor and upon
conviction shall be fined $1,000, or im prisonm ent for one year.
G a r n is h m e n ts . (See A ttachm ents.)
H o lid a y s. Legal holidays in M aryland are; Ja n u ary 1st, F ebruary
22, M arch 25th, M ay 30th, July 4th, Septem ber 12, October 12th,
December 25th, and when any of these days fall on Sunday th e
ensuing M onday is a legal holiday. Good Friday, L abor D ay (first
M onday in Septem ber), days of general and Congressional election,
special days appointed by th e Governor or President, as T hanks­
giving, fasting days or for religious observance, or for general cessation
of business
M H
,
In B altim ore C ity, and Baltim ore, Cecil, H arford and M ontgom ery
counties and Cum berland, alter twelve o ’clock noon every Saturday.
H u s b a n d a n d W ife. (See Dower, Divorce, and M arried Women.)
In th is S tate th e husband is n ot liable for wife’s ante-nuptial debts
or contracts. H usband is liable for necessaries of wife. Acts 1898
Oh. 457, gives husband sam e interest in wife's e state as wife has in
husband’s estate. M arried women are expressly authorized by th e
Acts of 1900, Ch. 633, to become p artners and to contract w ith h us­
band. E ith er can relinquish interest in o th er’s real estate by jo int
or separate deed, or by agent or attorney properly constituted. T he
wife’s property is protected by th e C onstitution from th e debts
of th e husband.

1754

B A N K IN G A N D C O M M E R C IA L L A W S— M A S S A C H U S E T T S

I n te r e s t. T he legal rate of Interest is 6 per cent per annum .
Judgm ents bear interest from th eir date. A person proved guilty
of usury forfeits the excess over th e real sum or value of th e goods
and chattels lent, and legal interest thereon. Since 1876, where the
whole d ebt, including th e usury. Is paid, th e usurious interest can
n o t be recovered back. Since Septem ber 1st, 1914, judgm ents
bear in terest from th e date of the verdict.
J u d g m e n ts are liens for twelve years from date of rendition on
any in terest of the defendant in real or leasehold property within
th e county where rendered. T hey can be transferred from one county
to another by sending a copy of th e d o ck et. entries to the clerk for
record. T he lien commences from th e date of the en try of th e docket
entries by the clerk. Judgm ents are not liens on m ortgages. Judg­
m ents are not liens on personal property until execution has issued
and th e w rit is in the hands of th e sheriff. (SSib Act 1890, Chap.
558, as to exam ination of judgm ent debtors.) (See Suits.)
L ie n s. (See Judgm ents.) M echanics’ Liens. E very building
erected," repaired, rebuilt, or im proved to th e extent of one-fourth
of its value is subject to a lien for work done or m aterials furnished
for or about th e same. Act of 1898, Ch. 502, abolished lien for
m aterials furnished for buildings in Baltim ore city. E very m achine,
wharf, or bridge, constructed or repaired is subject in like m anner
as buildings are, to a lien according to th e provisions of Code 1888,
A rt. 63. Sec. 22. All boats or vessels are subject to a lien for m aterials
furnished or work done in building, repairing, or equipping the same.
Garages by Act 1918 given lien for storage and accessories. To secure
th e lien and lay foundation for enforcing it, the m aterial m an m ust
w ithin six m onths a fter th e last work has been furnished, file a claim
iq th e superior court for Baltim ore C ity, or in the circuit court for
th e county. T he liens are enforced by scire facias or by bill in eouitv.
Section 53 B, B agby’s Ooae, amena&a by C hapter 355, Acts of 1916,
en titled “ Additional C ontracts.” E very note, sale, or contract for
sale of goods and chattels wherein th e title thereto, or lien thereon is
reserved u ntil th e sam e be paid in whole or in part, shall be void as
to th ird persons w ithout notice until such note, sale, or contract be
in writing signed by th e vendee and be recorded in th e Clerk’s office
of Baltim ore C ity, or th e counties, and such recording shall be suffi­
cient to give actual, or constructive notice to th ird parties.
L im ita tio n s of S u its . Accounts and notes are barred after
th ree years, sealed instrum ents after twelve years; judgm ents twelve
years except against foreign corporations (no lim itations). Act
1914, Ch. 846. A verbal prom ise or acknowledgm ent will revive a
deb t barred by th e sta tu te.
M a rrie d W o m e n . A ct of 1898, Chap. 457, Code A rt. 45, repeals
and re-enacts the entire law in th is S tate. M arried women m ay
hold and dispose of their property lawfully as if unm arried, b ut
husband m ust join in conveyances of real estate to release his in­
terest. M arried women m ay engage in business, contract, sue, and
be sued upon contracts and for torts, as if unm arried. M arried
woman is alone liable for ante-nuptial debts and contracts. Husband
is still liable for necessaries. Widow is entitled to dower in real estate,
and one th ird of the personal estate if th ere are children, and if no
children, one-half of th e personal estate; husband has sam e rights
in wife’s property as wife has in husband’s property. W here the
wife is adjudged a lunatic upon inquisition, and the finding rem ains
in force, husband m ay convey after acquired property by separate
deed, as if unm arried.
M o rtg a g e s are executed, acknowledged, an d recorded sam e as
deeds, and are n ot valid against creditors unless recorded within six
m onths. T here m ust be an affidavit m ade by th e mortgagee or his
agent a t any tim e before recording, th a t th e consideration is true and
bona fide, and, in th e four Counties m entioned below, th a t th e m ort­
gagee will not require th e m ortgagor, or any o ther person for him
to pay th e tax levied upon th e m ortgage interest, and upon the assign­
m en t of any m ortgage except for the purpose of foreclosure, a like
affidavit m ust be m ade by th e assignee. If m ade by agent, he m ust,
in addition, m ake oath th a t he is th e agent of th e mortgagee. A
like affidavit is required to chattel mortgages, and absolute bills
of sale, both of which m ust be recorded within tw enty days. The
lien of a m ortgage m ay, by ceasing to pay interest or any install­
m en t of th e principal for tw enty years, be barred. T hey m ay be
foreclosed a t any tim e after the d eb t becomes due and before the
lien is barred. M ortgagees are required to pay a tax of 8 per cent
on th e interest convenanted to be paid in th e m ortgage, in Somerset,
M ontgom ery, Frederick, and D orchester counties. No tax in B alti­
m ore C ity and o ther counties. (Code A rt. 81. Ch. 187.)
N o tes a n d B ills of E x ch an g e. Negotiable Instrum ents are de­
fined by Ch. 119 of th e Laws of 1898, which repeals all laws incon­
sisten t w ith th e provisions of this act. Section 20 provides as follows:
“ An in strum ent to be negotiable m ust conform to the following
requirem ents: 1. I t m ust be in writing and signed by the m aker or
drawer. 2. I t m ust contain an unconditional promise or order to
pay a sum certain in money. 3. M ust be payable on dem and, or a t a
fixed or determ inable future tim e. 4. M ust be payable to order or
to bearer; and 5, where th e instrum ent is addressed to a drawee,
/he m ust be nam ed or otherwise indicated therein w ith reasonable
certain ty .” Its negotiability is not affected by a seal, or by a provision
which v uthorizes th e sale of collateral securities in case th e instrum ent
be n o t paid a t m aturity, or authorizes a confession of judgm ent if
th e instrum ent be n o t paid a t m aturity; or waives th e benefit of any
law intended for th e advantage or th e protection of th e obligor; or
gives th e holder an election to require som ething to be done in lieu
of paym ent of money. I t is not necessary th a t paper should be
m ade payable a t a bank or any fixed place. To charge indorser,
notice of non-paym ent m ust a t once be given to him . T he tim e
of m atu rity is regulated by A rt. 13, as follows: “ Section 104: Time
of M atu rity. E very negotiable instrum ent is payable a t the tim e
fixed therein w ithout grace. W hen th e day of m aturity falls upon
Sunday, or a holiday, the instrum ent is payable on the next succeeding
business day. Instrum ents falling due on Saturday are to be pre­
sented for paym ent on th e next succeeding business day, except th a t
instrum ents payable on dem and m ay, a t the option of th e holder, be
presented for paym ent before 12 o’clock noon, on Saturday, when th a t
entire day is not a holiday.” Legal holidays are: Christm as,
N ew Y ear’s Day, F ebruary 22, Good Friday, Ju ly 4, M ay 30, 1st
M onday in September, 12th day of Septem ber, and th e 12th day of
October,- all days of general and congressional elections throughout
th e S tate and any day of public thanksgiving or hum iliation and
prayer proclaimed by th e governor or legislature, and all Saturdays
after 12 o’clock noon are legal half holidays. M onday is treated
as Sunday when im m ediately preceded by one of the holidays afore­
said. B y act 1898, Ch. 198, it shall be lawful for banks and bankers
in th e city of Baltim ore to close th eir doors for business a t 12 o’clock
noon, on each and every S aturday in th e year, and every S aturday
in th e year, after 12 o’clock noon, shall be a legal half-holiday, so
far as regards th e presenting for paym ent or acceptance, and the
protesting and giving notice of th e dishonor, of bills of exchange
and other negotiable paper, and for these purposes shall be considered
as th e first day of th e week, or Sunday, and all negotiable paper
shall be deemed to be presentable on th e secular day next succeeding.
Bagby’s Code am ended by C hapter 355,' Acts of 1916. N otes
wherein reservation of title is embodied m ust be recorded in th e
C lerk’s office of Baltim ore City, or in th e counties.
P o w er of A tto rn e y . E very power of atto rn ey authorizing an
agent o t attorney to sell and convey any real estate, shall be attested
and acknowledged in th e sam e m anner as a deed, and recorded prior
to or w ith th e deed executed in pursuance of such power of attorney.
A corporation shall have power to appoint an atto rn ey for the sam e


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

purpose, by its corporate seal. Such power of atto rn ey shall be
deemed to be revoked when th e instrum ent containing th e revocation
is recorded in th e office in which the deed should properly be recorded.
P ro b a te L aw . (See Adm inistration of E states and Wills.)
P r o te s t is usually m ade by notary public. N o tary m ust keep
register of protests. A protest of notary public is prim a facie evidence
of non-acceptance or non-paym ent, a n d ' of th e presentm ent of said
note for paym ent, or of said bill for acceptance or paym ent, at tbe
tim e and in the m anner stated in th e protest, and th e protest shall
also be prim a facie evidence th a t such notice has been sent or delivered
in th e m anner therein stated. (See N otes and Bills of Exchange.)
R e p le v in is a rem edy to recover specific goods and chattels to
whose possession the plaintiff is entitled. Also th e proper remedy
to recover possession of goods distrained unlawfully. Bond must be
given to th e S tate of M aryland, and any p arty having an interest
in th e property, m ay, upon breach of any covenant in bond, maintain
an action in the nam e of the S tate for his or her use.
S ales & N o tices; A ct 1910, Ch. 346. provides a Uniform Sales Act,
T axes. T he county commissioners of the several counties of the
State, and the m ayor and city council of Baltim ore C ity are directed
to levy a tax annually upon real and personal property situated
within the State, and no person who is not assessed to the sum of
$100 shall be required to pay any tax. Beginning w ith 1915, the
S tate tax is thirty-tw o and one-third cents, beside th e County tax.
The C ounty tax on Banks located and in business anywhere in Mary­
land is uniform ly 1 per cent. T he property of religious, charitable,
benevolent, and educational institutions, and cem etery companies is
exem pt from taxation. On tim ely application exemption may be
had for m anufacturer’s tools and m achinery in actual use from Munic­
ipal taxation in Baltim ore C ity and in some of th e Counties, and
beginning w ith 1915, from S tate taxation. Collectors may sell
property to compel paym ent of overdue taxes, upon giving due notice
of sale, and complying w ith other requisites of sta tu te, and any person
interested in property m ay redeem within twelve calendar months
from date, and in default of redem ption, title to property vests in
purchaser. Taxes are considered in arrears on first day of January
next succeeding the d ate of their levy, and bear interest from th at date.
T r u s t C o m p a n ie s . Laws of 1920, C hapter 268, Section 46. sub­
section ninth, provides th a t tru s t companies, by its directors, duly
authorized officers or agents, shall have th e powers as shall be usual
in th e carrying on of the banking business, b y buying, discounting,
negotiating promissory notes, bonds, drafts, bills of exchange, foreign
and dom estic and other evidences of indebtedness.
Laws of 1920. C hapter 64. T ru st companies tax one per cent,
sam e as sta te banks.
" U n if o rm S ta te L aw s” intended for adoption by all the States
and adopted by M aryland: (1) Negotiable Instrum ents, (2) Bills of
Lading, (3) Sales, (4) Warehouse Receipts, (5) Stock Transfer, (6)
Probate of Foreign Wills, (7) Uniform Bad Check Act, provides
th a t drawers shall be given ten days notice to m ake good check,
before prosecution.
Certificates of capital stock, bills of lading, and warehouse re­
ceipts, roughly speaking, (1) are negotiable, (2) represent the property
certified to.
W ills of land or personal property, and any codicil thereto, must
be in writing, signed by th e testator, or some one else for him, in
his presence, a t his request, and witnessed by two or more credible
witnesses, as and for last will and testam ent of th e testator, in the
presence of all the witnesses thereto. N uncupative wills invalid
except in case of disposition of personal property by soldiers and
m arines in actual service. E very will or other testam entary instru­
m ent executed w ithout this S tate in th e mode prescribed by law,
either of th e place where executed or of th e te sta to r’s domicile, or
according to th e forms required by the law of this State shall be
deem ed to be legally executed, and shall be of the same force and
effect as if executed in th e mode prescribed by tb e law of this State,
rovided, said last will and testam ent is in writing and subscribed
y the testato r: and if the testato r was originally domociled in Mary­
land, although a t the tim e of making th e will or a t the tim e of his
death he m ay be domiciled elsewhere, the said last will or testamen­
ta ry instrum ent so executed shall be adm itted to probate in any
orphans* court of this S tate; and when so adm itted shall be governed
by and construed and interpreted according to the law of Maryland,
without regard to the lex domicilii, unless the testa to r shall expressly
declare a contrary intention in said will or testam en tary instrument.
Code Art. 93, Ch. 334. N o will, testam ent, codicil, or other testa­
m entary 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 th e provisions
of Act of 1908, Ch. 125, m ay g rant letters testam en tary or of admin­
istration as th e case m ay be.
W o rk m e n ’s C o m p e n s a tio n . By the Act of 1914, Chapter 800,
provision is m ade for the insurance by employers of their employees
engaged in extra-hazardous occupations, to provide for compensation
for injuries and death. T his Act is intended to supersede within
its scope recovery for injuries through negligence as a tort, and to
do away w ith such defenses as “ assumed risk,” “ fellow servant
and. to some extent, ‘‘contributory negligence.” The extra-hazard­
ous em ploym ents are enum erated a t length, and th e extent of com­
pensation set out. Em ployers and employees, m ay by filing agree­
m ent, classify their occupation as extra-hazardous, although not so
enum erated in this Act. Article 101, Amended by C hapter 86, Acts
of 1916, so as to extend benefits to alien non-resident defendants upon
certain term s.

S Y N O P S IS OF

THE LAW S OF MASSACHUSETTS
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised by R a y m o n d T . P a r k e , A ttorney a t Law, 601 Tremont Bldg.
Boston, M ass. (See Card in A ttorneys’ List.)
A c c o u n ts . Ex p arte affidavit on claims and accounts is of no
value. T hey m ust be established by evidence produced in court
after suit brought either by testim ony or deposition.
A c k n o w le d g m e n ts a n d D eeds. Acknowledgments m ay be maa®
before any justice of th e peace, notary public or special commission®»
in th e S tate; when th e acknowledgm ent is m ade by any^POr?°.n„ , jirl
o ut th is S tate and within any other state, territo ry or district oi w*®
U nited States, it m ay be m ade before any officer of such state, terri­
to ry or district authorized by th e laws thereof to tak e the proor an
acknowledgm ent of deeds, and when so taken th ere shall be attacu®
to th e certificate of acknowledgm ent a certificate of the secretary «
th e sta te or territo ry in which such officer resides, under the seaioi
sta te or teirito ry , or a certificate of th e clerk of a court of record oi su

B A N K IN G A N D C O M M E R C IA L L A W S— M A S S A C H U S E T T S
state, territo ry or district, m the county in which such officer resides
under seal of said court, certifying as to the authority; of such office*
to take acknowledgments and as to the genuineness of his signature
In deeds where th ere is more th an one grantor, the acknowledgment
of one of them is sufficient. Official taking acknowledgment should
state d ate of expiration of his commission.
No separate exam ination or acknowledgm ent of wife Joining in a
release of dower necessary. Conveyances of land are m ade by deed
under seal executed by th e grantor or attorney having authority
therefor. A conveyance in fee, for life or for a term exceeding seven
years, shall not be valid except as against the grantor and persons
having actual notice of it, unless recorded in the county in which the
real estate is situated. Deeds m ust be under seal, a scroll being
insufficient. No subscribing witness is necessary. Release of dower
homestead and other interests m ust be explicitly stated in deed, wife’s
joining in deed merely, being insufficient. Husband and wife m ay
make conveyances of real estate to each other except by way of
mortgage, as if unm arried, b u t no such conveyance shall have any
effect, eith er in passing title or otherwise, until th e deed describing
the property to be transferred is duly acknowledged and recorded in
the registry of deeds for the district where the land lies. Any interest
in real estate m ay be transferred by a person to him self jointly with
another person or persons in the same m anner in which It m ight be
transferred by him to another person. No interest in land except
an estate a t will can be created except by instrum ent in writing or by
operation of law.
A ctio n s. T here are three classes of actions: contract, to rt and
replevin. Actions a t law are begun by w rits issued in blank form by
the clerks of th e several courts. No declaration need be inserted in
the writ, except in cases of arre st on mesne process or of an attach ­
ment of a vessel. Suits in equity are begun by filing a bill upon which
a subpoena is issued by the clerk of the court. Actions begun by
trustee process m ust be brought in th e county in which th e trustee
or one of them resides or has his usual place of business.
A d m in is tr a tio n o f E sta te s . A dm inistration or probate is to be
taken o u t in county where deceased last resided. Executors or adm in­
istrators are required to give a bond of about double th e value of the
personal estate. An executor will be exem pt from giving sureties if
testator so directs. An adm inistrator will be exem pt if all persons
interested in this State except creditors consent and all creditors are
notified by publication. In case a non-resident is appointed exdcutor
or adm inistrator, he m ust appoint a resident agent. T here are public
administrators in each county to whom adm inistration is granted upon
estates of persons who die in testate leaving property, and not having
any husband, widow, or heir in this State. Ancillary, adm inistration
may be granted upon th e estate of a non-resident who dies leaving
property in this S tate. E very adm inistrator and executor «hail flje
an inventory within three m onths, and publish notice of his appoint­
ment. Notice of a debt, and dem and for its paym ent should be given
to an executor or adm inistrator within six m onths after his appoint­
ment and th e d eb t should be paid after six m onths and within one
year of th e appointm ent. N o suit can be brought by a creditor
against an executor or adm inistrator within six m onths after his
giving bond, except on a claim not affected by the Insolvency of the
estate. N o suit can be brought against an executor or adm inistrator
who has published notice of his appointm ent, after one year from
time of his giving bond, unless he has received new assets after the
expiration of th e one year, or unless further tim e 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 th e estate
is insufficient to pay all claims, the executor or adm inistrator shall
represent th e estate insolvent and commissioner will be appointed
to receive proof of claims, or the C ourt m ay receive and act upon the
claims. Claims for funeral expenses, last sickness, and charges of
administration, are n ot affected by the Insolvency of th e estate
Executors and adm inistrators shall render an account a t least once
a year.
A liens. Resident or non-resident aliens m ay sue and be sued and
may hold and convey real estate.
A rrest. In an action of contract, th e defendant unless she is a
woman, m ay be arrested on -mesne process provided the plaintiff, and
except m actions on negotiable instrum ents, the original p arty to the
contract or his executors or adm inistrators m akes affidavit and
satisfactorily proves to the court to which the writ is returnable th at
be expects to recover a sum am ounting to $20; th a t he believes th at
defendant has property which he does not intend to apply to paym ent
or plaintiff's deb t; th a t he believes th a t defendant intends to leave
the S tate. Actions of to rt, against women as well as men, except for
slander or libel, m ay be begun by arrest of the defendant, on. the
plaintiff or some one in his behalf m aking certain affidavits. A de­
fendant arrested on m esne process m ay give bail or he m ay apply to
take an oath th a t he does not intend to leave the State, or the oath
for relief of poor debtors; on taking such oath he is released from
arrest. N o arrest can be m ade if the property of defendant is attached
upon th e sam e writ. On an execution, except for costs, or for ali­
mony. or one issued in an action of to rt, or where debtor is about to
teave th e State, he can n ot be arrested until he has first been cited
before a m agistrate for exam ination, and it appearing th a t he has
property and refuses to assign it, the m agistrate m ay order his arrest.
When arrested on execution the debtor m ay apply to take the oath
for relief of poor debtors.
A ssig n m e n ts for benefit of creditors. A voluntary assignm ent to
trustees for benefit of creditors can not be avoided by creditors Who
assent thereto, except by proceedings in bankruptcy begun within
[bur m onths or by proof of fraud. I f 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.
A tta c h m e n t. All real estate, goods, and chattels n ot exem pt,
may be taken in attach m en t on th e original w rit and held as security
[or judgm ent, except th a t lands and tenem ents can not be attached
m suits involving less th en *20. A ttachm ents m ay be m ade in suits
by or against non-residents as well as in suits by or against residents.
No bond is required to m ake an attachm ent. Shares of stock in
corporations cannot be attached except by bill in equity. A ttachm ent
or shares of stock is n ot valid against a bona fide transfer although
oot recorded in book of corporation. D ebtor m ay dissolve attachm ent
by furnishing bond w ith sureties to pay judgm ent obtained or value of
property attached determ ined by appraisem ent. D ebtor against
whom judgm ent is rendered for over *20 m ay be subjected to sworn
examination touching his property, and if he refuses to deliver up
such property (not being exem pt from attachm ent!, an order for
arrest will issue and he can then apply to take th e poor debtor’s oath
and be examined as to his property after notice to creditor. An
attachment is dissolved by death of th e defendant if adm inistration
is granted upon his estate upon application m ade within one year
after his death.
B a n k s. The banking business is extensively regulated by sta tu te.
£>enera,I, savings banks, co-operative banks, tru s t companies, or
ether corporations or persons doing banking business in M assachusetts
;£e
tQ 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 tran sact business in M assachusetts until
it has received certificate from board of bank incorporation. There
F e very few existing sta te banks, and Rev. Laws, ch. 115, in view of
sS'cpSsi
Mi
n.°t re-enacted in th e consolidation of statu tes
m tfeneral Laws, effective Ja n u ary 1, 1921. F or extensive provisions
relative to Savings Banks, see Gen. Laws, ch. 168.
tr u s t com pany is th e prevailing form of banking institution,
rnteen or more persons associating by w ritten agreem ent m ay, upon
compliance w ith statu te, become a tru s t company. Agreem ent of
association m ust set forth corporate nam e, purpose, city or town in
Massachusetts where business is to be transacted, am ount of capital
wock and num ber of shares. Notice of intention to form tr u s t com-


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1755

pany shall be given to board of bank incorporation, and such notice
m ust be published. Unless th e board issues a certificate th a t public
convenience and advantage will be prom oted by establishm ent of
such a tru st company, no fu rth er proceedings shall be had, b u t after
one year th e application m ay be renewed. A fter the first m eeting of
the subscribers the president and m ajority of board of directors
execute in duplicate articles setting forth copy of agreem ent of associ­
ation, nam es of subscribers and nam es and residences of officers
date of first m eeting, one of th e certificates is subm itted to bank
commissioner, the other together with records of proposed corporation
to commissioner of corporations and taxation. Approval by com­
missioner m ust be endorsed if he finds th a t legal requirem ents in­
cluding certificate of convenience, have been m et. The articles are
filed w ith th e secretary of state, w ith filing fee of one tw entieth of
1 per cent of capital stock, and certificate of incorporation issues,
tsetore business can be commenced a certificate authorizing such
must be obtained from board of bank incorporation. (Gen. Laws,
ch. 172, section 11). A director of tru s t com pany m ust hold a t least
cen shares of unpledged stock, and m ajority of directors m ust be citi­
zens of and resident in M assachusetts, and n ot over one-third of th e
directors shall be directors in any other such corporation. Except
in sm aller m unicipalities capital stock of tru s t com pany m ust be not
less th an *200,000; shares p ar value of *100 each. E n tire capital
stock m ust be paid m m cash. Stockholders of tr u s t com pany shall
be personally liable, equally and ratably and n ot one for another
to am ount of th eir stock therein a t p ar in addition to am ount invested
in such shares, for all contracts, debts and engagem ents of the corpo­
ration. In case of im paired capital, bank commissioner has authority
to act. Commissioner of banks has extensive power to require returns
and to supervise and examine. Savings departm ents m ay be estabItehed. Tbe kinds of business which m ay be done are prescribed by
sta tu te w ith considerable detail.
B u is a n d N o te s. T he law of negotiable instrum ents Is governed
by th e Negotiable Instrum ents Law, as am ended, where applicablem other cases by th e law m erchant. A person becoming a p arty
to a non-negotiable promissiory note payable on tm e, by signature
blank on tti8 back thereof, is entitled to notice of non-paym ent
same as an indorser. A depositary of funds, subject to withdrawal by
5?£ck °J dem and d raft m ay pay a check or dem and d raft drawn on
it by a depositor having funds on deposit to pay same, notw ithstanding
uis death, upon presentation within ten days after its date
P rotest of bill, note or order duly certified by notary public under
his hand and official seal is prim a facie evidence of facts, stated in
such protest and of giving n o tic e to draw er or indorser.
T here are various sta tu to ry provisions bearing upon the validity
of the notes of m unicipalities of this Commonwealth. W here a nego­
tiable instrum ent is not payable on dem and, presentm ent m ust be
made on the day it falls due. W here it is payable on dem and present­
m ent m ust be m ade within a reasonable tim e after its issue.
An accom m odation p arty to a negotiable instrum ent is liable thereon
£°, a holder in due course notw ithstanding such holder a t the tim e of
taking th e instrum ent knew him to be only an accommodation party.
When th e day, or the last day, for the perform ance of any act, includ­
ing th e m aking of any paym ent or tender of paym ent, authorized or
required by sta tu te or by contract falls on Sunday or on a legal holi­
day, the act m ay be perform ed on th e next succeeding secular or busi­
ness day, unless it is specifically authorized or required to be performed
on Sunday or on a legal holiday.
E very negotiable instrum ent is payable a t th e tim e fixed therein
without grace, except th a t three days of grace shall be allowed upon a
d raft or bill of exchange m ade payable w ithin M assachusetts a t sight
unless there is an express stipulation to the contrary. W here th e day
of m aturity falls upon Saturday, Sunday, or a holiday, instrum ent is
payable on next succeeding business day which is not a Saturday.
Instrum ents payable on dem and m ay, a t option of holder, be presented
ror paym ent before twelve o’clock noon on S aturday when th a t entire
day is n o t a holiday; provided however th a t no person receiving any
check, draft, bill of exchange or promissory note payable on dem and.
Miall be charged w ith any neglect or omission of d u ty or incur any
liability, for not presenting for paym ent or acceptance or collection
such check, draft, bill of exchange, or promissory note on a Saturdayprovided also th a t the same shall be duly presented for paym ent!
acceptance, or collection on the next succeeding business day.
Under certain circum stances the original nam ed payee of order
paper m ay be a holder in due course.
No bank shall be liable to a depositor, or to the draw er of a bill of
exchange upon the bank, for an am ount charged to or collected from
ntm on account of paym ent by such bank of a negotiable instrum ent
upon which the signature of any p arty is forged, or which is m ade,
drawn, accepted or indorsed w ithout authority, or which is m aterially
altered or the am ount of which is raised; Unless w ithin one year after
return of such negotiable instrum ent to such depositor or drawer,
he shall notify the bank in wciting th at, as th e case m ay be, the instru­
m ent was m ade, drawn accepted or indorsed w ithout authority, th a t
signature of a p arty to instrum ent is forged, or th a t instrum ent has
been m aterially altered, or th a t th e am ount has been raised.
B ills of L a d in g . T he so-called Uniform Bills of Lading Act is in
force, and has been held constitutional b y th e Supreme Judicial
Court. A bill in which it is stated th a t th e goods are consigned or
destined to a specified person is a non-negotiable or straight bill. A
i™ ln which it is stated th a t the goods are consigned or destined to
th e order of any peraon nam ed in such bill is a negotiable‘or order bill.
A non-negotiable bill cannot be negotiated, and indorsem ent of such
a bill gives transferee no additional right. A negotiable bill m ay be
negotiate^ by indorsem ent of person to whose order goods are deliv­
erable by tenor 6f bill. Such indorsem ent m ay be in blank or to a
specified person. If indorsed to a specified person it m ay be nego­
tiated again by the indorsem ent of such person in blank or to another
specified person. Subsequent negotiation m ay be m ade in like manher, A negotiable bill m ay be negotiated by any person in possession
of same, however such possession m ay have been acquired if, by the
term s of th e bill, th e carrier undertakes to deliver the goods to the
order of such person.^ or if a t tim e of negotiation bill is in such form
th a t It m ay ‘be negotiated by delivery. Indorsem ent of bill does not
m ake indorser liable for any failure on p art of carrier or previous in­
dorsers of th e bill to fulfil their respective obligations. Any pro­
vision in an order bill th a t it is non-negotiable shall be void.
B ills o f S ale, A bill of sale of personal property intended for
security m ust be recorded, the recording provisions as to m ortgages of
personal property being applicable. See C hattel M ortgages.
B lu e S ky L aw . Acts of 1921, ch. 499, approved M ay 27, 1921,
entitled Prom otion and Sale of Securities. Act applies to no con­
tra c ts Valid and effective before act became effective. C ertain secur­
ities are exem pted. Act defines a t length w hat is m eant by security
and sale. Persons dealing in securities within operation of act m ust
be registered and inform ation specified m ust be furnished commission.
C ertain classes of sales and certain securities are exem pted from
operation of A ct. Annual fee for broker, *50, for salesman, *2. Act
does not lim it any sta tu to ry or common law right of any person to
sue civilly or right of sta te to punish for violation of any law. Com­
m ission has power of inquiry, of summoning witnesses and of suspenam g certain sales. Act has im m unity provisions. Violation of
act punishable by fine of not moré th a n *5,000 or im prisonm ent not
more th a n tw o and one-half years, or both.
C h a tte l M o rtg a g e s . C hattel mortgages m ust be recorded in the
records of th e city of town where the m ortgagor resides when th e
m ortgage is m ade, and in the city in which he th en transacts business,
every m ortgage, m ust be recorded within fifteen days of th e date
until recorded the m ortgage is not valid except between th e parties
and record subsequent* to tim e lim ited is void. I f m ortgage is given
by non-resident m ortgagor, record m ust be m ade in city o r town where
property then is. I f record in two places is required, and mortgage
is recorded in one place within fifteen days, it m ay be recorded in
other place within ten days after date of first record.

1756

B A N K IN G A N D C O M M E R C IA L L A W S— M A S S A C H U S E T T S

C o n d itio n a l, S ales. I f a contract for sale of personal property
is m ade on condition th a t title shall not pass, until purchase money
has been fully paid, and vendor upon default takes possession of prop­
e rty , th e vendee m ay within fifteen days after such taking redeem the
property so tak en by paying to vendor th e full am ount th en unpaid
w ith interest and all lawful charges and expenses due to vendor.
T here are special statutory, provisions affecting conditional sales of
furniture o r other household effects.
B y sta tu te no conditional sale of heating apparatus, plum bing goods,
ranges, or o ther articles of personal property which are afterw ards
w rought into or attached to real estate, w hether fixtures a t common
law o r not, shall be valid against any m ortgagee, purchaser or grantee
o f such real estate unless n ot later th an ten days after delivery thereon
o f such personal property a notice in form prescribed by sta tu te is
recorded in registry of deeds of district where land lies. S tatu te also
applies to registered land.
. In th e ordinary case, contracts of conditional sale need n ot be re­
corded. Selling or concealing personal p roperty held by vendee
under a w ritten conditional contract of sale, before perform ance of
condition and w ith in ten t to defraud, is a crim inal offense.
C o rp o ra tio n s . B y special act of 1903, chapter 437, th e law of
business corporations was revised and as am ended, and now codified
in General Laws, applies to all corporations organized in th is common­
w ealth for th e purpose of carrying on business within th e common­
w ealth for profit, except th e following: Banks, savings banks, co­
operative banks, tru s t companies, surety or indem nity companies,
safe deposit companies, insurance companies, railroad or street railway
companies, telegraph or telephone companies, gas or electric light,
h eat or power companies, canal, aqueduct or w ater companies, ceme­
tery , o r crem atory companies, or any corporation which now have or
m ay hereafter have th e right to take or condemn land, or to exercise
franchise in public ways, provided th a t corporations, form ed for
purpose of dealing in real estate shall sta te the term of th e duration
of th e corporation, such term not to exceed fifty years.
T hree or m ore persons m ay associate together and form a corporation
fo r carrying on any lawful business not included in th e above provisions
Such a corporation m ust have a capital of n ot less th an $1,000, if
having shares only w ith p ar value. T here is no m axim um lim it:
Business corporations m ay create shares of stock w ith or w ithout
p a r value, and corporations w ith stock w ith p a r value m ay, by
appropriate proceedings, change such stock to stock w ithout p ar value.
T he stock , m ay be divided into two or more classes w ith such
preferences, voting powers, restrictions and qualifications as m ay
be fixed b y th e agreem ent of association. Upon due organiza­
tion- of th e associates and filing a copy of the agreem ent of
association w ith th e c o m m issio n er of corporations and on pay­
m en t of a fee of one-tw entieth of 1 per cent of to tal am ount of author­
ized capital stock w ith p a r value, and five cents per share for all
authorized Shares w ithout p ar value, b u t in no case less th a n $50,
a certificate of incorporation is issued by th e secretary of state. The
capital stock m ay be issued for cash property, tangible or intangible
services or expenses, b u t n ot for notes. T he am ount of capital stock
m ay be increased from tim e to tim e. T he corporation m ust have
n o t less th a n three directors, president, clerk and tre a s u re r.' The
directorsT treasurer, and clerk are elected by th e stockholders. The
president is chosen by and from th e board of directors. T he clerk
m u st be a resident of th e commonwealth. M eetings of stockholders
m ust be held w ithin th e commonwealth, b u t directors m ay m eet
w ithin or w ithout th e commonwealth. Voting by proxy is per­
m itted, b u t no. proxy dated m ore th an six m onths before the
m eeting nam ed is valid. Any corporation m ay hold, purchase, con­
vey m ortgage or lease such real or personal property as th e purposes
of th e business m ay require.
^ E v ery such corporation is required to file an annual report of its
condition, and if its capital stock is over $100,000, shares w ithout par
value being tak en as of $100 in value, to file a w ritten statem ent
un d er o ath b y an auditor. I t is also required to m ake an annual
retu rn to th e tax commissioner.
_
E very foreign corporation wnich has a usual place of busines
here, o r is engaged here perm anently or tem porarily in th e construc­
tion, erection, alteration or repair of a building, bridge, railroad, rail­
way or stru cture of any kind, shall before doing business here appoint
th e commissioner of corporations, its attorney for the service of proc­
ess, such au th o rity to continue as long as any liability remains o ut­
standing against it in this commonwealth, and shall file w ith the
commissioner of corporations a copy of its charter, articles or certifi­
cate of incorporation, by-laws, and a certificate setting forth its
nam e, location of principal office, names: and addresses of its officers,
d ate of its annual meeting, am ount of its capital stock authorized and
issued, th e num ber and p ar value of its shares, th e am ount paid
thereon, and details of any paym ent thereof n ot m ade in money.
Such corporations are required to file annual statem ents w ith the
commissioner of corporations showing th eir condition.
C o u r ts . T erm s and Jurisdiction. T rial justices m ay severally
hold courts within th e counties for which th ey are appointed, and
shall have original jurisdiction, exclusive of th e superior court, of all
actions o f contract, to rt, or replevin, where th e debt or dam ages
dem anded or value of th e property alleged to be detained does not
exceed $100, and concurrent jurisdiction w ith the superior court of
such actions where such am ount exceeds $100 and is less th an $300.
Police and d istrict courts m ay in th eir respective counties have original
jurisdiction, exclusive of the Superior C ourt, of actions of contract, to rt
or replevin, in which th e debt or dam ages dem anded or th e value of
th e property alleged to be detained does n ot exceed $100 and have
original an d concurrent jurisdiction w ith th e Superior C ourt of actions
of contract, to r t or replevin in which th e d eb t or dam ages dem anded
or th e value of th e property alleged to be detained is m ore th an $100
and does n o t exceed $1,000. T he suprem e judicial court has original
jurisdiction in all equity m atters and m ay on appeal hear all m atters
determ ined by th e probate court, and determ ine questions arising under
wills. Superior court has jurisdiction where th e am ount claimed ex­
ceeds $20. M unicipal court of the city of Boston has jurisdiction con­
currently w ith th e superior court in th e county of Suffolk, in actions
where th e debt does n o t exceed $2,000, provided one or more of the
defendants resides or has his usual place of business in the county of
Suffolk. T he Land C ourt has exclusive original jurisdiction for regis­
tering titles to real estate under th e T orrens system.
The P ro b ate C ourts have jurisdiction over adm inistration of estates
of deceased persons, m atters of adoption, guardianship, conserva­
torship, tru sts under wills and W ritten instrum ents, petitions for
separate support, and of p artition of land. T here is a P robate C ourt
and R egistry of P robate in each county.
E q u ity jurisdiction is .lodged in th e Superior C ourt and in Supreme
Judicial C ourt. By sta tu te P robate C ourts have jurisdiction in equity
in certain special m atters.
D e p o s itio n s , T aking of such is governed by sta tu te and rules of
courts. T he commission issued to take depositions contains full
instructions to m agistrate how to proceed.
D e s c e n t a n d D is tr ib u tio n o f P ro p e rty of D e c e d e n ts. A fter
deducting widow’s allowance and allowances for m inor children,
and paym ent of debts and expenses of adm inistration, th e rem aining
personal and real estate is distributed as follows: I f deceased leaves
no issue, surviving husband or widow shall take $5,000 and one-half
of rem aining real and personal property. I f deceased leaves issue,
surviving husband or widow shall take one-third of rem aining real and
personal property. I f deceased leaves no kindred, surviving husband
or widow shall tak e whole of rem aining real and personal property.
A husband on death of wife shall hold for his life one-third of all
land owned by her a t any tim e during coverture, estate known as
tenancy by curtesy. Wife is entitled to dower a t common law. B u t
in order to be entitled to such curtesy or dower election and claim
therefor m ust be filed in registry of probate w ith six m onths of approval
of bond of executor or adm inistrator, and such election is a w aiver
o f th e interests on real property above m entioned. P robate C ourt


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

assigns dower or curtesy. Rights of curtesy which exist on February
1, 1919, m ay be claimed as above provided, b u t in such case husband
shall take no other interest in real or personal property of wife, and
except as above preserved curtesy a t common law is abolished.
Subject to all th e above, th e rest and residue of in testate property
Is distributed as follows: 1. In equal shares to children and issue of
any deceased child by right of representation; if th ere is no surviving
child, then to th e o ther lineal descendants if all are in same degree of
kindred, otherwise by right of representation. 2. I f intestate leaves
no issue, then in equal shares to fath er and m other. 3. I f no issue
nor m other, then to father. 4. I f no issue or father, th en to mother.
5. I f no issue, fath er or m other, th en to brothers and sisters and to
issue of deceased brothers or sisters by right of representation; if
no surviving brother or sister, th en to issue of such equally if all in
same degree of kindred to intestate, otherwise by right of represen­
tation. 6. I f he leaves no issue, no father, m other, brother or sister
or issue of deceased brother or sister, th en to next of kin in equal
degree, b u t if th ere are tw o or m ore collateral kindred in equal degree
claiming through different ancestors, those claiming through nearest
ancestor are preferred. I f in testate leaves no kindred, husband or
widow, estate escheats to commonwealth.
E x e c u tio n s can n ot issue u ntil tw enty-four hours after judgment
rendered, and an original execution m ust be issued within one year
after plaintiff is entitled to sue out th e same. Original executions in
all courts are returnable within sixty days, alias executions five years.
E x e m p tio n s . Hom estead, if recorded, to th e value of $800.
Necessary wearing apparel of family, certain specified articles of
household furniture, and $300 w orth in addition thereto, library, $50;
tools and im plem ents, $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 trad e and intended
to be used or wrought therein, n ot exceeding $100 in value. Shares in
co-operative associations n ot exceeding $20 in value, funds of.railroad
relief societies assessment insurance benefits, uniforms, arms, and
equipm ents of m ilitia officers.
F a c to r 's A ct. A factor or other agent in tru sted w ith possession
of m erchandise or of bill of lading consigning m erchandise to him with
authority to sell th e sam e shall be deem ed th e tru e owner of such
merchandise, so far as to give validity to any bona fide contract of
sale m ade 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.
F ra u d s , S t a t u t e o f. N o action can be brought to charge an
executor or adm inistrator on a special promise, to charge any person
upon a special prom ise to answer for debt, default or misdoing of
another, upon an agreem ent m ade on consideration of marriage, upon
a contract for sale of any interest in land, upon an agreem ent hot to
be perform ed within a year, to charge a discharged debtor, unless the
promise, contract or agreem ent or some m em orandum thereof is
signed by th e p a rty or by his authorized agent. No agreement to
m ake a will, or to devise or to give a legacy is binding unless in writing.
No contract of sale of personal property of $500 or over is actionable
unless there is p a rt paym ent, acceptance and receipt of part of the
goods, or some m em orandum in w riting signed by p arty to be charged
or his agent.
In so lv e n c y . T here is an insolvent law, b u t it is superseded by the
N ational B ankruptcy A ct of 1898. As to insolvent estates of deceased
persons, see A dm inistration of E states.
G ifts b e tw e e n H u s b a n d a n d W ife. G ifts of personal property
husband an d wife shall be valid to sam e extent as if th ey were sole.
H o lid ay s. Ja n u ary 1st, New Y ear’s D ay; F ebruary 22nd, Wash­
ington’s B irthday; April 19th, P a trio t’s D ay; M ay 30th, Decoration
D ay; July 4th, Independence D ay; F irst M onday in September, Labor
D ay; October 12th, Colum bus D ay Thanksgiving D ay; December 25,
C hristm as D ay.
I n t e r e s t . Legal ra te is 6 per cent. T here are no usury laws,
b u t there are certain sta tu to ry provisions relative to interest upon
small loans.
J u d g m e n ts . A judgm ent or decree of a court of record of the
U nited S tates or of any sta te thereof shall be presum ed to be paid
and satisfied a t th e expiration of tw enty years after it was rendered.
L im ita tio n of S u its . C ontract express or im plied and not under
seal and not otherwise lim ited, six years; real actions, those upon an
atteste d note, if suit is brought by original payee o r’his executor or
adm inistrator, and personal actions on contracts n o t limited, twenty
years. Absence from th e S tate prevents th e running of the statute
of lim itations as to a defendant u ntil he comes into th e State. If
th e person entitled to bring an action is a m inor or is insane or impris­
oned when th e right to bring such action first accrues, such action
m ay be commenced within the tim e hereinbefore lim ited after the
disability is rem oved. T he sta tu te does n ot ru n against those residing
out of the S tate. See also A dm inistration of E states.
M a rrie d W o m e n . T he real and personal estate of a married
woman, acquired a t any tim e, rem ains h er sole and separate property,
n ot subject to the control of her husband, nor liable for his debts.
M arried women m ay carry on trad e or business, m ake contracts, sue
and be sued, in all m atters relating to th eir separate property, and
such contracts are n ot binding upon th e husband. Wife carrying
on business on own account m ust record certificate w ith 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.
M e c h a n ic ’s L ie n s. Subject covered by sta tu te .
M o rtg a g e s of B e a l E s ta te . Power of sale mortgage is univer­
sally used. Foreclosure is regulated by sta tu te, requiring publication
prior to sale, and sale bars redem ption. M ortgages m ay also be fore­
closed by entry and peaceable possession for three years.
S ales of P e rs o n a l P ro p e rty . U niform Sales Act adopted in
1908, is now Gen. Laws ch. 106. T here 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 F rauds, S tatute of. sa«®
of m erchandise in bulk are fraudulent unless th e provisions of Gen.
Laws ch. 106, sec. 1, are complied w ith. Delivery of a bill of sale is nor
constructive delivery of th e goods. Delivery of possession of goo™
sold is essential as to th ird persons w ithout notice who purchase same
goods for value, or as to attaching creditors w ithout notice. Yenaors
retention of possession after sale is prim a facie evidence of iraua.
As to conditional sales. See th a t topic supra.
S ta t u t e s . General revision and consolidation of statutes, effective
Jan u ary 1, 1921 under title of General Laws.
S to c k T ra n s fe r. T his subject is covered by Stock Transfer Act
as codified in G eneral Laws.
S u its . Civil actions in general, except those concerning pM II®
one of th e parties lives in th e State), m ust be brought in the county
where one of them lives or has his usual place of business, n u t »
lower courts venue depends on residence or place of business or aeieu
dant. W here all parties are non-resident, action m ay be brougnt *
any county. A ttachm ent of property owned by defendants resiouus
o ut of S tate m ay be m ade sufficient to give jurisdiction for a speci
judgm ent in suit after notice published by order of court. Sucn now
to be given w ithin one year from th e en try of th e suit. Persons co
m orant in S tate m ay also be arrested on m ense process ana neiu
bail. A non-resident plaintiff is usually required to furnish moors
for costs. See also Actions, supra.
T axes assessed upon land shall w ith all incidental charges and fees
be a lien thereon from April 1st in the year of assessment, sucu

B A N K IN G A N D C O M M E R C IA L ' L A W S— M IC H IG A N
shall term inate a t th e expiration of two years from October 1st in said
year, if th e estate h as in th e m eantim e been alienated and th e in­
strum ent alienating th e same has been recorded, otherwise it shall
continue u n til a recorded alienation thereof; b u t if while such lien is
in force a tax sale or taking has been m ade and th e deed or instrum ent
of taking has been duly recorded within th irty days, b u t th e sale or
taking is invalid by reason of an y error or irregularity in th e pro­
ceedings subsequent to th e assessm ent, th e lien shall continue for
ninety days after a release, notice or disclaimer, h as been duly recorded,
or for ninety days after th e sale or taking has been finally adjudged
invalid by a court of com petent jurisdiction. T here shall be no Uen
for taxes reassessed if th e property is alienated before th e reassessm ent.
Said taxes if unpaid for fourteen days after dem and therefor, m ay,
with said charges and fees, be levied by sale of th e real estate if the
lien thereon h as n o t term inated.
The m atter of enforcing the paym ent or collection of taxes is, of
course, one concerning which there is a considerable body of sta tu te
law which cannot b e briefly sum m arized. I t will probably be more
satisfactory to you to com pare w hat I have w ritten w ith th e m aterial
you already have and th en givethesubject such treatm en t as your space
permits.
T ru s te e P ro c ess. All personal actions except replevin, and actions
of to rt for malicious prosecution, slander, libel, or assault and b attery
may be begun b y tru stee process and goods, effects, or credits of
defendant in h and of a th ird person m ay be attached and held to
satisfy final judgm ent. See also Actions, supra.
W a re h o u s e m a n a n d W a re h o u se R e c e ip ts. T he W arehouse
Receipts Act as codified into Gen. Laws is in force.
W ills. E v ery person of full age and sound m ind including m arried
women m ay m ake a w ill. W ill m ust be signed by testa to r, or b y some
person in his behalf, by his express direction, and be attested and
subscribed b y th ree or m ore com petent witnesses in his presence. A
will executed in mode prescribed by th e law either of place where
will is executed or o f place of te sta to r’s domicil, shall be deemed
legally executed and shall be of sam e force and effect as if executed
in mode prescribed by laws of M assachusetts provided will is in writing
and subscribed by testator. As to w aiver of provisions of will by
husband o r wife, see D escent and D istribution, supra, also General
Laws ch. 190, section 15.

S Y N O P S IS OF

THE LAW S OF MICHIGAN
RELA TING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised by H e n r y W u n s c h and E d w a r d F . W u n s c h .
A ttorneys a t Law, D etroit, Michigan.
(See C ard in A ttorneys’ List.)
A c k n o w led g m en ts of real estate instrum ents m ay be before one
of the following officers: 1. W ithin this S tate: Any judge, clerk
or commissioner of any court of record, notary public, justice of the
peace or m aster in chancery. T he official should certify th a t “ On
this day before m e personally ap p eared .............
to me known
to be th e person or persons who executed th e foregoing instrum ent
'and acknowledged th a t he (or they) executed th e sam e as his (or
their) free act an d deed.” N o tary ’s certificate m ust show date of
expiration commission. Such instrum ents m ust have tw o subscribing
witnesses. 2. In any o ther state, territory, or district of th e United
States: Same officiate as described above or any officer authorized
by the laws of such state, territory, or district, or before a com­
missioner appointed by th e G overnor of th is S tate for th a t purpose.
Any such instrum ent m ay be executed according to th e laws of any
such other sta te or territory. I f officer has no seal, certificate of the
Clerk of th e county or district, or of th e Secretary of S tate w ithin
which taken shall be attached. 3. In any foreign country: notary
public, or m inister plenipotentiary, m inister extraordinary, m inister
resident, charge d ’affairs, or commissioner or consul of th e United
States, appointed to reside therein.
A ctions. Common law forms of pleadings are used, b u t in some
respects modified by sta tu te. N on-resident plaintiffs m ust give
security for costs.
A d m in is tra tio n o f E s ta te s : In probate court of each county.
Claims are passed on b y judge of probate or commissioners appointed
for each estate; w ithin such tim e allowed by th e court, n ot exceeding
in first instance one y ear nor less th an four m onths; m ay be extended
not to exceed two years from date; th e court m ay revive commis­
sion any tim e before estate is closed and allow furth er tim e three
months to examine an y claim ; an appeal to circuit courts from allow­
ance or disallowance of an y claim. All claims barred, n ot presented
before adm inistration is closed:—
Administration of in testate estates is g ranted: 1st, to surviv­
ing husband or wife, or kin or grantee, or such one of them as judge
may appoint, o r as th ey m ay request. 2nd, to one or more of the
principal creditors. 3rd, to such other person as th e judge m ay think
proper. N on-resident adm inistrators and executors appointed in
other states, territories, or foreign countries cannot sue as such in
this State w ithout procuring adm inistration in th is State.
A ffidavits m ay b e tak en b y any judge, m aster in chancery, clerk
of court, justice of th e peace, police m agistrate, n otary public, or
circuit court commissioner. A ny oath authorized, or required to be
made,’w ithout th e S tate for use in judicial proceedings here, m ust be
authenticated b y judge of a court having a seal, and th e genuineness
of such judge’s signature, existence of th e court, and th a t such judge
is a member thereof, certified by the clerk of th e court under th e seal
thereof. I f in any o th er sta te or territory, m ay be taken before a
commissioner appointed by th e governor of th is State, or any notary
public or justice of th e peace authorized by th e laws of any such sta te
or territory to adm inister oaths therein.
In actions a t law affidavits of am ount due on open and stated
accounts, attached to and served w ith process as commenceament of
suit make a prim a facie case, unless denied b y th e defendant’s affidavit
nled and served w ith plea.
Aliens. M ay inherit or purchase and hold and convey personal
and real estate.
A rb itra tio n . C om petent parties to any controversy which is or
'night be th e subject of an action a t law or su it in equity, m ay agree
to arbitrate, an d judgm ent of any circuit court rendered upon the
award. N o arb itratio n of claim of any person to any estate in fee
or for life in real estate.
A rrest. B y w rit of capias in personal actions in to r t and in actions
for money collected by any public officer; or upon promise to m arry;
also by w arrant allowed by any justice of th e peace or judge of a
court of record, u n d er th e fraudulent debtor’s act, when th e creditor
has commenced su it or obtained judgm ent and th e debtor has disposed
of or concealed, or is about to dispose of or conceal property liable to
execution or th e d eb t was fraudulently contracted.
.A ssig n m en ts for th e benefit of creditors are void Unless m ade
without preferences; m ust comprise all of assignor’s property not
exempt from execution. T he Circuit court in chancery has super­
visory jurisdiction of such assignments.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

»

1757

A tta c h m e n ts . W rits m ay be issued from justice and circuit courts
on affidavit showing: deb t due on express or implied contract, and
either th a t th e debtor has absconded or is about to abscond from
the S tate or has assigned or disposed of or is about to assign And
dispose of his property w ith in ten t to defraud his creditors; or is a
non-resident of th e state, or a foreign corporation. M ay issue from
th e circuit court for d eb t n o t due b u t to become due, upon satis­
factory showing to th e circuit judge, b u t in such cases judgm ent can­
n ot be taken u ntil d eb t is due. M ay issue in actions of to rt against
non-residents in certain cases.
B a n k s. Incorporation of: A ny num ber of persons not less th an
five m ay associate to establish for a period n ot to exceed th irty years,
commercial banks, savings banks, and banks having for both classes.
C apital 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 departm ent and Secretary of S tate
issue certificates of organization; hoard of directors chosen b y the
stockholders. N o more th a n th e legal ra te of interest in advance
shall be received; file correct list of stockholders w ith commissioner
of banking, and county clerk and rep o rt four tim es a year to be pub­
lished in newspaper where bank is conducted. Commercial loans,
not to exceed 50 per cent of th e capital, on real estate securities, by
tw o-thirds vote of directors, except to secure debts due th e bank.
Savings deposits payable as directors prescribe; commercial deposits
payable on dem and. Banks combining commercial and savings
deposits cannot issue post notes nor any bill o r note or certificate as
money. Savings depositors preferred in distribution of savings
departm ent funds. Stockholders individually liable equally and
ratably and n ot one for another to th e am ount of th e par value of
stock, for th e benefit of depositors. All transfers o f property, and
paym ents of money after actual or contem plated insolvency to pre­
vent legal application of assets null and void; total liabilities of ahy
borrower shall n ot exceed one-tenth p a rt of th e whole capital and
surplus, m ay be increased to one-fifth by tw o-thirds vote of directors;
not to issue certificates of deposit for borrowed money nor m ake
partial paym ents on such certificates; n ot liabie to depositors for pay­
m ent or a forged or raised check unless notified w ithin three m onths
a fter retu rn of voucher.
All shares of bank stock shall be assessed against their owners in
th e township, village, or city, where th e L ank is located, taxes n o t
paid by stockholders, bank’s d u ty to pay.
T ru st deposits and security companies m ay be incorporated un d er
th e general laws of th e S tate applicable thereto. Seven or more
persons m ay associate to establish—capital graded from $100,000 to
$5,000,000 according to population of cities where conducted; deposit
w ith th e sta te treasurer 50 per cent of th e capital stock in bonds
o r real estate m ortgages w orth double the am ount secured; powers
such as are custom ary for tru st companies. T hey cannot do any
banking business.
B lu e S ky L aw . Michigan in 1915 passed an act, commonly known
a s th e Blue Sky Law. regulating th e selling of and dealing in stocks,
bonds and other securities w ith certain exceptions of corporations,
associations, partnerships and individuals, so as to prevent frau d in
such dealings, and creating a Commission of three to adm inister th e
provision of th e law. U nder this law application m ust be m ade to
th e M ichigan Securities Commission and th e approval of th e Com­
mission secured before such securities m ay be sold. C ertain penalties
a re imposed under th e law for non-compliance w ith its provision.
T he M ichigan Suprem e C ourt has declared th e act to be C onstitutional
a n d valid.
C o lla te ra ls . Stocks, bonds or o ther personal property pledged
As collateral security for paym ent of m oney or th e perform ance of
an y obligation, upon default m ay be sold a t public (or private sale
if so authorized by th e contract) to satisfy the debt; b u t before public
sale, te n days notice m ust be given and served on pledger or legal
representative personally or by m ail; such sale m ust be between
nine o’clock forenoon an d sunset, a t a public place in th e township,
■city, or village where held.
, C o n d itio n a l S ales. Are valid between th e parties: if consignée
or purchaser, on condition title is retained by seller, is authorized by
th e contract to sell, ail such sales are valid. T he consignee or pur­
chaser eannot m ake valid sales « g a in st th e legal owner w ithout the
a u th o rity of consignor or legal owner. (See Liens.) (See Frauds.)
C o n v e y a n c e s. A ny person of full age or otherw ise capable m ay
convey by deed any interest in lands, w hether in actual possession
or not. AM grants and devises of lands to two or m ore persons create
estates in common; no joint tenancy, unless expressly so declared,
except such as are m ade in tru st or to executors, and except such as
a re m ade to husband and wife, who tak e as .“ ten an ts b y en tirety .”
T he words “ conveys and w arrants ” in th e deed describing th e premises
an d specifying th e consideration, dated, duly signed and acknowledged
b y grantor are sufficient to convey title in fee simple and to w arrant,
th a t grantor and his heirs and personal representatives is seized of
th e premises, has good rig h t to convey same, guarantees quiet pos­
session thereof, and th a t he will w arrant and defend th é title against
all lawful claims. T he words “ conveys and quit claim s” duly signed,
sealed and acknowledged by grantor are sufficient to convey grantor’s
interest. T he words “ m ortgages and w arra n ts” and duly described
premises, specifying “ to secure th e p ay m en t” and reciting th e sum
for which m ortgage is given^ and the notes and other evidences of
d eb t secured thereby, m ortgage being dated, signed, sealed and
acknowledged by grantor, is sufficient and w arrants perfect title in
th e grantor an d against all previous incum brances; om itting th e
word “ w arra n ts” sufficient, b u t w ithout any w arranty. Dower and
hom estead rights n ot waived unless wife joins in th e m ortgage. No
hom estead rig h t will avail against th e m ortgagee If th ere is no wife,
nor if wife joins in th e m ortgage. M arried women of full age joining
w ith husbands in any deed, m ortgage, power of attorney or other
writing, shall be bound in respect to th eir own title.
C o rp o ra tio n s . Banks, mining, m anufacturing, insurance—fire,
m arine, accident, burglary—-printing and publishing, m anufacturing
and m ercantile, or a union of th e two, partnership associations, real
estate associations, real estate, railroads, street railways, co-operàtive
benefit associations, co-operative savings associations, and religious
societies, are respectively organized under S tate general laws; required
to file w ith th e secretary of state, articles of association.
Business Corporations. T hree or more persons m ay organize.
One half of capital m ust be actually subscribed and a t least 10 per
emit either in money or property m ust be paid in; if in property same
m ust be for i th e purpose of th e business, and described and its value
specified in th e articles. Stockholders vote in person or by proxy.
E ach share has as m any votes for directors as directory numbers,
and th e aggregate vote m ay be distributed for one or more of direc­
tors. M ay issue preferred and common stock of th e par value of
$10 or $100. Preferred entitled to dividend n ot to exceed 8 pèr cent
quarterly, sem i-annually or annually and if n ot paid be accumulated,
and paid, before any dividend paid on th e common. Articles of
association to be recorded in th e county clerk’s office of county where
operations carried on. and office of th e secretary of state. M ay hold
real estate for th e purpose of the corporation and such as acquired
as security or in paym ent of debts, m anaged by-hot less th an three
directors chosen by th e stockholders annually hold office u ntil suc­
cessors áre chosen; m ake duplicate reports in Jan u ary or February
annually for the fiscal year last ending, of th e financial condition a n a 7
property of th e corporation to secretary of state: stockholders are
liable for labor debts; they m ake all by-law's for corporation. Foreign
corporations organized under th e laws of any other sta te of th e United
S tates or of any foreign country, unlawful to carry on business in
this sta te u ntil certificate of au th o rity procured from secretary of
State; not capable of m aking valid contracts in th is sta te u ntil authorized to carry on business; unlawful for any person to act as agent of
u ntil authorized to do business. Sales of goods or m erchandise by
th e right of inter-state commerce n o t affected by sta te laws.

-1758

B A N K IN G A N D C O M M E R C IA L L A W S — M IC H IG A N

C o u rts . T e rm s of J u r is d ic tio n . Circuit, courts, holding two
or more term s annually in each county, have origina] jurisdiction in
all cases of law and equity wherein the am ount in controversy is. $100
and upw ards; and have appellate jurisdiction from justice of the
peace probate courts, and other inferior tribunals. Justice courts in
each county have jurisdiction of cases a t law involving from $100 toi
$500. In G rand R apids is a “ Superior C o u rt” for civil cases, limited
to parties resident of th e city. P robate courts in each county have
jurisdiction of estates of deceased persons and testam entary tru sts
Supreme court has final appellate jurisdiction from circuit, munic­
ipal an d recorders’ courts.
D ays o f G ra c e . Abolished.
D ep o sitio n s. Testim ony of any witness w ithout the State of
more th an fifty miles from the court m ay be taken de bene esse,
before any judge of any sta te or of the U nited States, or of any foreign
country, or before any circuit court commissioner in this or any other
state, or of th e United States, or any commissioner of this S tate, any
consul or consular officer, justice of th e peace officer, or notary public
authorized to adm inister oaths in the sta te or county where taken
and n o t interested as attorney or counsel or in the event of the cause;
reasonable notice given in writing by p arty or his attorney proposing
to tak e to opposite p arty or his attorney of record, stating nam es of
witnesses, tim e 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 th e su it is pending or by the judge or
register thereof, or by a justice of the peace in a suit before him on
w ritten interrogatives. Fees for taking, certifying, sealing and for­
warding $2; for each 100 words in deposition ten cents and copies
th ree cents. Each p arty pays for his own exam ination or cross
exam ination in th e first instance.
D e s c e n t. Real estate and personal property of intestate after
paym ent of debts and adm inistration expenses and allowances as
follows ;
Real Property. One-third to widow, rem aining tw o-thirds to his
issue; if no widow th e 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 fath er and m other in equal shares,
if only one living to th e survivor alone. If surviving husband or
widow and no issue, one-half to such survivor, rem ainder to father
and m other 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 any unm arried child dies under
age, his or her inheritance from any parent, to other surviving children
of sam e 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 S tate. Illegitim ates heir to m other; dying intestate
estate descends to m other or her relatives if she be dead; become
legitim ate by parents, interm arriage or fath er’s w ritten acknowlm ent. T he foregoing provisions for the widow are in lieu of dower
and hom estead right unless one year after adm inistration granted
she applies for assignm ent of dower and hom estead in which case
her interest in deceased husband’s lands is lim ited to th e dower and
homestead right and th e residue shall descend as above provided for
th a t portion not taken by her.
Personal E state. Residue — one-third to widow, tw o-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 an d no children or issue, to widow, not exceeding $3,000;
estate excess of th a t, 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. M arried women intestate, one-third to hus­
band, tw o-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 sam e
as for real property. E states by curtesy abolished.
D ow er. Wife entitled to use of one-third p art of all lands owned
by her husband as estate of inheritance any tim e during m arriage.
No dower as against m ortgages for purchase price, or m ortgages m ade
before m arriage, except in surplus. M ust exercise option to take
dower in lieu of rights under will or sta tu te within one year after
adm inistration; residing in th is S tate and eighteen years of age and
upwards m ay bar by joining in husband’s conveyances and m ort­
gages or by deed alone to one who has husband’s title, in ten t to bar
being expressed; or by jointure secured as bar.
E x e c u tio n . M ay issue to any county a t once, unless stayed after
judgm ent 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 w ithout appraisem ent to the highest
bidder, except hom estead, to determ ine excess of value above $1,500
redem ption claim. D efendant or his heirs or assigns m ay redeem
within twelve m onths, his judgm ent creditors and others having valid
liens within fifteen m onths from date of sale. Execution against the
body m ay be issued on all judgm ents in actions of to rt. Personal
property levied on, after setting off exemptions, may_ be sold on six
days’ notice a t public sale, to highest bidder to a sufficient am ount to
satisfy th e debt and costs; no redem ption after such sales. Execu­
tions from justice courts do n o t run against real estate.
E x e m p tio n s . Hom estead—selected by th e owner and occupied
by him ; n o t exceeding forty acres of land and dwelling thereon; or one
lot w ith dwelling thereon within any recorded town plat or city or
village not exceeding in value $1,500. Same cannot be alienated or
Incumbered w ithout 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 th a t am ount is paid or realized on sale under
such process. Exem ption of hom estead continues during its Occupa­
tion by th e widow or m inor children of deceased person who when
living occupied the same.
F ra u d . Crim inal fraud—obtaining th e signature of any person,
firm. Or corporation w ith in ten t to defraud. Fraudulently issuing or
selling or duplicating and disposing of any stock, scrip, or evidence of
debt of any bank or other incorporated com pany of this S tate; issue
o f an y false receipts by warehousemen, m erchants, or their agents—
receipt; or to wrongfully dispose of or convert property to their own
use a fter issuing receipt; Wrongfully rem oving or disposing of any
personal property by any agent delivered upon w ritten agreem ent or
instructions; wrongfully to dispose of property covered by chattel
mortgage by m ortgagors or of property held by contract of purchase
w ithout legal title by such purchaser or of property held under anÿ
lease by lessor. For any officer or stockholder of any bank or any
other person for such bank; to sign, issue or knowingly p u t in circula­
tion any note or bill of any such bank, before th e capital stock is
paid in, or before the president and directors thereof have complied
with th e law; for an y officer or agent of any bank knowing such bank
to be insolvent or in contem plation of insolvency, or for any assignee
of th e property of such bank to sell or dispose of any m oney or property
of such bank w ith intent to defraud, delay or hinder creditors thereof,
or for an y agent or person to fraudulently obtain or dispose of any
money belonging to any insurance com pany organized in th is S tate.
F ra u d s —S t a t u t e of. Ñ o executor or adm inistrator is liable on
any special promise to answer dam ages o ut of his own estates.
F r a u d , C ivil. Sales, transfers, and assignm ents of stocks of goods,
wares, merchandise, and fixtures in bulk, pertaining to conduct of any
business, otherwise th a n in ordinary course of trad e of seller, etc.,
void as against creditors, unless the seller, etc., five days before sale,
m ake inventory of th e goods and cost price to seller of each article
and unless the purchaser dem ands from seller list of nam es and
addresses of creditors and his indebtedness, and within five days
beforq taking possession and paym ent notifies every creditor of such
«¿le.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

G a r n is h m e n t. Process m ay issue in any action brought in any
justice court or circuit court on contract expressed or implied, judg­
m ent or decree, to hold w hatever property any person m ay own or
have belonging to th e debtor. Bills of exchange and promissory
notes due in the garnishee's hands a t the tim e of serving summons
are gam ishable. P roperty, 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 paym ent of the debts of th e debtor
in the garnishee’s hands m ay 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 n ot more th an $15 and not less th an $4; and
benefits payable by fraternal beneficiary societies, shares in building
and loan association of any debtor, except as to one having a home­
stead exemption, are exem pt from garnishm ent.
H o lid ay s. (Legal) January 1st, F ebruary 12th, F ebruary 22d,
M ay 30th, July 4th, first M onday in Septem ber, Thanksgiving Day
as specified by the Governor of State, December 25th; every Saturday
from 12 o ’clock noon to 12 o ’clock m idnight, all N ational, State,
County, or C ity election days.
H u s b a n d a n d W ife. If sued together she m ay defend and if
either neglect to defend the other m ay be ordered to defend for both.
If he deserts her she m ay be authorized by the probate court to prose­
cute or defend in his nam e. I f either wrongfully retains th e other’s
nroperty. acquired before or after m arriage, the owner m ay sue for
sam e as if unm arried. N either liable for the debts of th e other before
m arriage, nor earnings or property of either nor th e income thereof,
nor shall either be liable to m ake com pensation for labor or services
rendered for the other. H usband is liable after m arriage for family
expenses, and for debts incurred by the wife w ith his express or
implied authority. E ith er m ay 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 th e wife b ut are
chargeable against the husband and he m ay be sued therefor.
I n t e r e s t . Legal rate 5 per cent but by w ritten agreem ent may be
charged not to exceed 7 per cent. Forfeiture of all interest is penalty
for usury. When any installm ent of interest upon any note, bond,
m ortgage or other w ritten contract shall become due and remains
unpaid, interest is allowed on such installm ent from th e tim e it became
due a t same rate specified in the obligation or a t the legal rate. Legal
rate collectable on all moneys due on any w ritten obligations and on
all m oneys due on all contracts express or implied, w hether verbal
or w ritten; and on settlem ent of accounts from day of ascertaining
balance due; and on judgm ents from day of entry; and on verdicts of
jury from date to date of en try of judgm ents thereon. In computing
tim e of interest and discount on negotiable paper, a m onth means
a calendar m onth and a year a calendar year of twelve months.
J u d g m e n ts of courts of record are not liens on real estate or
personal property until by levy thereon of execution issued from the
courts upon such judgm ents. Liens under execution levied upon
real estate exist five years from and after the levy. Judgm ents expire
by lim itation in ten years from date of entering in courts of record
and six years in justice courts, and cannot be renewed except by action
a t law thereon before expiration. Judgm ents of th e justice of the
peace m ay be entered in th e circuit courts on tran scrip t duly taken
to the circuit court and thereupon become judgm ents of such circuit
courts.
Liens.. Any person, who pursuant to a contract w ith any owner,
p art owner or leasee of any land, furnishes labor or m aterials in the
construction of a building, etc., on such land, shall have a lien on such
structure and land to the extent of one q u arter section or if in a city
or village, the lot or lots upon which such structure is situated. And
any sub-contractor, who furnishes m aterials 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 tradesm an for labor and skill applied upon any property
delivered for th a t purpose shall have a prior lien for am ount dufe 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 th a t purpose have a lien for proper charges.
L im ita tio n of S u its . Judgm ents of courts of record ten years,
justice court judgm ents six years; accounts and notes and other
simple contracts and for taking, detaining or injuring goods and
chattels, six years from th e date the action accrued: revivor; part
paym ent, or promise in w riting to pay. Absences from the State
deducted from the period of lim itation. M ortgages fifteen years
after due or after last paym ent thereon. F or trespasses on lands,
assault and b attery , false im prisonm ent, slanderous words or libels
and m al-practice against physicians, surgeons, and dentists, two
years. For m isconduct of sheriff or their deputies, three years, and
for personal injuries three years. F or the recovery of real property,
five years where the claim arises against executors, guardian’s or
sheriff's deed; five years where the defendant claims and is in pos­
session of lands under deed m ade by auditor general of this State for
taxes; and by minors and others under legal disabilities three years
after rem oval of such disabilities; in all o ther cases fifteen years.
L im ite d P a r tn e rs h ip s . M ay consist of one or more general and
one or more special partners. Specials contribute specific amount
of capital in cash or property a t cash value, and If actually paid in
n o t liable for firm’s debts in excess of such special capital. General
partners transact the business of the firm.
M a rried W o m en . M ay m ake contracts in respect to their own
property and may hold and enjoy, and have th e same rights and
rem edies regarding their property as if unm arried. T hey may carry
on business in th eir own nam es w ith their own property by consent
of their husbands; cannot en ter 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, m ay however charge their real estate or per­
sonal property to secure such indebtedness by deed, mortgage or
contract. M arried women are entitled to have and to hold their
earnings m ade by their own .personal effort, and m ay m ake any con­
tracts relative thereto.
M o rtg a g e s on real estate, executed and acknowledged the same,
as deeds; m ay be foreclosed under power of sale by advertisement
or in circuit court in chancery of the county wherein the property
is situated. T rust deeds not in custom ary use b u t m ay be made ana
executed and will be treated as m ortgages.
’
C hattel m ortgages and bills of sale; intended as security by mort­
gagor, signed and delivered to the m ortgagee, sufficient between the
parties, b ut void as to creditors, subsequent purchasers and encum­
brancers in good faith and without notice, unless such mortgages ana
bills of sale or true copies are filed in the city or township clerk s
where m ortgagor resides, or if non-resident of S tate, in city or
ship where the property Is situated; and unless affidavit of mortgagor
or of some one for him having knowledge of th e facts is annexed to
the m ortgage or bill of sale, showing consideration is actual anu
adequate and in good faith. W ithout such affidavit officers foroaae
to receive and file such m ortgages; cease to be valid against creditors,
subsequent purchasers, and encum brancers in good faith, on expira­
tion of y e a r from filing date, unless renewed within th irty days nex»
preceding expiration by affidavit of mortgagee showing his interest,
etc., filed and annexed to th e m ortgage in said clerk’s office; likewise
each succeeding year while the m ortgage exists.
N e g o tiab le I n s t r u m e n t s . A prom issory note is an unconditional
prom ise in w riting to pay a sum certain in money, on demand, or »
a fixed and determ inate future tim e, to the order of a specified persu
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 Dearer
dem and or a t a fixed or determ inate future tim e a certain sum

B A N K IN G A N D C O M M E R C IA L L A W S — M IN N E S O T A
money. M ay be payable In installm ents and contain provisions th a t
on default the whole sum of m oney shall become due w ith exchange,
Axed or current rate, interest and atto rn ey ’s fees for collection. M ay
authorize sale of collaterals and confession of judgm ents. I f it reads
"I promise to p ay ,” all m akers are jointly and severally liable. M ust
not be payable upon contingency. C annot waive exem ption from
execution. Need not specify “ for value received” nor place where
drawn or payable. If issued, accepted, or indorsed, when over
due is payable on dem and. M ay be payable to two or more payees
jointly or one or more of several payees. W ant 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 th e payee of the
paper placing a signature in blank on the paper before delivery becomes
an endorser. Indorser engages on due presentm ent th e paper shall
be honored and th a t he will pay to holder or any subsequent indorser,
who m ay be compelled to pay; where m aturity falls on Sunday or on
a holiday, paym ent due on th e next business day; but where all of such
day not a holiday m ay if payable on dem and be presented before noon.
Fraud in p ro cu rin g .signatures and delivery defense against any
holder.
Presentm ent not necessary to charge anyone prim arily liable. If
not payable on dem and present on the day due; if on dem and present
within a reasonable tim e after issue; bill of exchange payable on
demand present reasonable tim e after last negotiation.
Fraudulent or m aterial alterations do not affect the original instru­
ments in the hands of innocent holder in due course.
Unconditional promise in w riting to accept a bill of exchange,
ifiven before or after drawn, valid in favor of all who take it upon
faith thereof for value; bolder m ay decline qualified acceptance; if
he takes qualified acceptance, drawers and indorsers are discharged.
Protest of foreign bills of exchange m ay be m ade by a notary public
or any respectable resident of the place of paym ent in the presence of
two or more creditable witnesses; drawee is not liable unless h e accepts.
Check or a bill of exchange on a bank payable on demand, m ust be
presented reasonable tim e after issue, and if dishonored notice m ust
be given or draw er is discharged to extent of loss caused; does not
operate to assign any p a rt of draw er’s funds; bank is not liable unless
it accepts or certifies. If holder has check certified drawers and
Indorsers are discharged.
The present negotiable instrum ents law of M ichigan took effect
Sept. 16, 1905. and repeals all acts or parts of acts inconsistent with
Its provisions; b u t does not apply to instrum ents m ade prior thereto;
materially changes th e law in this S tate and should receive special
examination in every doubtful case.
Power o f A tto rn e y . Almost every act th a t any person, firm or
corporation m ay perform, m ay be perform ed by an attorney in fact.
Conveyances, m ortgages, or leases for more than three years’ term
by attorney in fact, th e power of atto rn ey m ust be in writing signed,
waled and acknowledged same as a deed of lands, to be adm itted for
record or to proof thereof.
P ro b ate L aw . (See Adm inistration of E states.)
P ro te st. (See Negotiable Instrum ents.)
Replevin. Goods o r chattels wrongfully taken or detained m ay
tjereplevined by owner or p a rt owner or p arty entitled to possession.
Affidavit of plaintiff or agent necessary for issue of writ. If from
circuit courts plaintiff required to give bond w ith sufficient sureties
to the officer within tw enty-four hours after seizure and appraisal of
the property which m ust not be delivered to plaintiff within fortyeight hours; and in th e m eantim e if the defendant shall give sufficient
bond to th e officer he shall return the property to the sam e person
from whom he took it; in th a t case if plaintiff recovers he m ay recover
jo the defendant’8 bond; if he fails defendant m ay recover on plain­
tiff s bond according as th e judgm ent m ay w arrant. In justice courts
bond with sufficient sureties m ust be given and filed in double value
of the property before w rit issues.
Taxes. S tate and county payable every year after December 1st,
delivered to county treasurer M arch 1st, thereafter, and if delinquent
bear interest 1 per cent per m onth. R eturned 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 th e am ount of taxes and
charges against same; redeemable one year thereafter and does not
become absolute until proceedings taken by purchaser for w rit of
assistance, which m ust b e instituted within five years by service of
written notice upon owners six m onths before application for such
writ. If decree regular and property taxable, and due notice is given
»nd served, purchaser is entitled, upon due proof thereof to w rit of
usistance and possession unless redeemed pending th e notice by
payment of double th e am ount paid by purchaser and $5.00 for each
parcel redeemed. C ity taxes are governed by charter or by the
general act under which cities and villages are organized.
Wills. C o d icils. Every person of full age (tw enty-one years) and
or sound mind m ay make; m ust be in writing, signed by testa to r or by
wme person in his or her presence duly authorized by him or her and
«tested and subscribed in his or her presence by two or m ore witnesses
competentas such a t th e tim e. If one of th e subscribing witnesses
wall testify to th e execution of the will in all particulars an d testa­
tor '5vas.
sound mind a t the tim e will was m ade, the court m ay
Wmit the will, in case no person appears to contest it; if none of
We witnesses reside in th e S tate a t the tim e of proving the will, the
bourt may adm it the testim ony of other witnesses to prove testa to r’s
and execution and proof of the signature of testa to r and sub•oibing witnesses. Probate of will conclusive of its due execution
Md cannot be assailed collaterally. Foreign wills, duly adm itted to
Probate w ithout th e S tate, m ay be adm itted and recorded in any
S°ttnty of th e S tate in which testa to r left real or personal estate by
July filing, an exemplified copy of said will and of th e record adm itting
»me to probate. A nuncupative will in which th e value of th e estate
bequeathed does n o t exceed $300, duly proved by two witnesses, m ay
n ^,Pw®d. Wills m ay be revoked by burning, tearing, cancelling,
or obliterating w ith intention of revoking sam e by testator, or by some
otfter writing signed, attested , and subscribed in th e m anner provided
>or execution of wills b u t shall prevent revocation implied by law.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1759

S Y N O P S IS OF

THE LAW S OF MINNESOTA
RELA TING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S

Revised by O p p e n h e i m e r , P e t e r s o n , D ic k s o n & H
A ttorneys a t Law, St. Paul. (See C ard in
A ttorneys’ List.)

o d g so n , -

A c k n o w led g m en ts m ay be certified by the following officers:
i. W ithin the S tate by a resident judge, clerk or deputy clerk of
any court of record therein, a notary public, justice of the peace,
town, city or village clerk, or recorder, court commissioner, register of
deeds, or county auditor, or their deputies, county commissioner, or
member of th e legislature. 2. O ut of th e S tate b u t in the United
States by a judge of the suprem e, circuit, or district courts of the
United States, or of any court of record of any state, territory, or dis­
trict, th e 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
S tate for th a t purpose. 3. In foreign countries by a notary public,'
or by any m inister, charge d ’affaires, commissioner, consul, commercial
agent or o ther consular or diplom atic officer of the United S tates
appointed to reside in such country, and deputies or other represen­
tatives of such officers. The form of th e certificate m ay be, “ On
this. ................. day o f........................ . 1 9 . . . . , before me personally
appeared....................... to me known to be the person described in,
and who executed the foregoing instrum ent an a acknowledged th a t
he executed the same as his free act and deed.” In case of corpora­
tion it m ay be, On th is ................... day o f.................... 1 9 . . . . , before me
appeared A. B. to me personally known, who being by me duly sworn
did say th a t he is th e president (or other officer) of (name of corpora­
tion) , th a t the seal affixed to th e foregoing instrum ent is th e corporate
seal of said corporation and th a t said instrum ent was executed in
behalf of said corporation by authority of its board of directors, and
said A. B. acknowledged said instrum ent to be the free act and deed
° f said corporation.” If m ade outside th e S tate the impression of the
official seal of the certifying officer m ust be affixed, or there m ust be
attached th e certificate of the clerk of a court of record of the county
or district in which it is m ade under his seal th a t the signature of th e
certifying officer is genuine.
A ctio n s. T he distinction between actions a t law and suits in
equity is abolished. T here is only one form of action. I t is called
a civil action and m ust be prosecuted in th e nam e of the real p arty
In interest except th a t executors, adm inistrators, trustee of an express
tru st and persons expressly authorized by sta tu te m ay sue without
joining th e person for whose benefit the suit is brought.
A d m in is tr a tio n of E s ta te s . E states of deceased persons are
adm inistered in probate courts of which there is one in each county
presided over by the probate judge of th e county.
In granting letters of adm inistration preference is given: 1. T o 1
the surviving spouse or next of kin or such suitable person as they
or either of them select. 2. I f no application is m ade for th irty
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 th a t country residing in this
S tate, or to such com petent and suitable person as he m ay select.
Upon granting letters the court ipakes an order lim iting th e tim e
w ithin which creditors m ay present th eir claims. T his tim e m ust
not be less th an six or more than twelve m onths; b u t m ay be extended
for good cause to a date not more th an eighteen m onths after notice
,.ven,
Jpd order. On proof by affidavit th a t th ere are no debts
the tim e lim ited m ay be three m onths. N otice of th e order is given
by publication thereof once each week for three weeks in a newspaper
in the county. Claims not presented within tim e lim ited are barred.
Non-resident executors and adm inistrators m ay sue in this S tate.
A llen s. (See right to hold property.)
A r b itra tio n . AH controversies which can be the subject of a civil
action m ay be subm itted to one or more arbitrators for decision,
except a claim to an estate in fee or for life in real estate.
A rre s t. T here is no arre st for debt.
A s sig n m e n ts. S tatutes relating to assignm ents for the benefit of
creditors are in force except as affected by the U. S. B ankruptcy Act
of 1898.
P ractically they m ay be said to be superseded by th a t act.
A tta c h m e n t. Before allowing a writ of attachm ent, the court
m ust require of the plaintiff a bond in the sum of a t least $250, and
an affidavit of the plaintiff, his agent or attorney. (1) T h at the debt
was fraudulently contracted or (2) the defendant is a foreign corpora­
tion or non-resident or (3) has departed from the S tate 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.
B a n k s. T hree or more persons m ay incorporate as a bank. They
m ust first secure from the state securities commission a certificate of
authorization, which is granted or denied after a hearing and intro­
duction of evidence. Capital required is $10,000 in towns of 1,000
or less population; $15,000 in towns of 1,000 to 1,500; $20,000 in
towns of 1,500 to 2,000; and $25,000 in towns exceeding 2,000 popu­
lation. ' C apital stock m ust be fully paid in cash before bank can do
business. Stockholders are individually liable for debts of bank in
an additional am ount equal to the par value of stock owned by them ,
and this liability continues one year after any transfer of the stock.
A t least one-fifth of the net profits m ust be placed in surplus fund
before any dividend is paid until the surplus am ounts to 20 per cent
of th e capital, and this surplus m ust be m aintained unimpaired
Every bank m ust m ake to the superintendent of banks not less th an
four reports each year which m ust be published. Liabilities to a bank
of any person, corporation or firm, for money borrowed, including
therein liabilities of the several members thereof, shall a t no tim e
exceed 15 per cent of its capital and surplus. I t m ust have a reserve
equal to one-fifth of all its m atured or dem andable liabilities, one-half
of which m ust be cash, and the rem ainder m ay be balances due from
solvent banks. In case of insolvency or violation of the banking laws,
th e superintendent of banks m ay take possession, and apply to the
court for a receiver. Branch banks are prohibited.
B ills of L a d in g . T he Uniform Bills of Lading Act becam e effec­
tive April 20, 1917.
Initial C arrier receiving property for transportation between points
within the State, liable for loss., dam age or injury caused by it or
other carrier en route, and all contrary provisions in Bill of Lading
void.
B lu e Sky L aw . The commission consists of three members.
The law prohibits the selling by any investm ent com pany (person,
firm or corporation engaging in the business of selling securities issued
by him . they or it) and any dealer (person, firm or corporation offering

1760

B A N K I N G A N D C O M M E R C IA L L A W S— M IN N E S O T A

securities issued by an investm ent company) from offering or selling
an y securities except those exem pt u n til licensed by the commission.
T h e commission is given ra th e r extensive powers to regulate the
selling price of securities and th e costs of prom otion, of fixing the
conditions under which a license shall be granted, to require the
furnishing of relevant inform ation and to suspend or annul existing
licenses.
T he m ore im portant securities exem pt from th e act are municipal
securities, commercial papers and unsecured negotiable notes due
w ithin eighteen m onths, securities of public service corporations, of
Federal Reserve and Federal F arm Loan Banks, of non-stock cor­
porations', insurance policies and m ortgage securities where th e debt
is not m ore th a n 70 per cent of th e security. Penalties are provided
for violation of th e act.
C h a tte l M o rtg a g e s. E very m ortgage of personal property which
is n o t accompanied by im m ediate delivery and followed by actual and
continued change of possession is void as to creditors and subsequent
purchasers and m ortgagees in good faith, unless it is m ade in good
raith, atte ste d by tw o witnesses, acknowledged and filed w ith the
register of deeds of th e county in which th e m ortgagor resided a t
th e tim e o f its execution, is a resident of th e State, or of th a t in which
th e p ro p erty was th e n situated if a non-resident. I f th e m ortgagor
resides in St. P aul. M inneapolis or D uluth or is a non-resident, and
th e p roperty is situ ated there, th e m ortgage m ust be filed w ith the
city clerk of such city instead of thelregister of deeds of th e county.
D uplicates or copies certified by any officer w ith whom th e m ortgage
has been properly filed, m ay be filed in o th er places wherein any p a rt of
th e pro p erty was situ ated when th e sam e was m ade. As against
creditors of th e m ortgagor and subsequent purchasers and mortgagees
in good faith th e lien does n o t continue beyond th e term of six years
from th e date of filing th e m ortgage unless th e indebtedness is n ot
th en d u e and payable b y its term s, in which case it continues tw o years
a fte r th e m atu rity of th e d eb t and no longer.
C h attel m ortgages given b y a m arried m an or woman on property
exem pt from execution m ust be executed by both husband and wife
if living.
C o n v e y an ces. D eeds and m ortgages of real estate m ust be exe­
cuted in th e presence of tw o subscribing witnesses and to entitle them
to record m ust be acknowledged by th e person executing th e same.
Conveyances m ade o ut of th e S tate, m ay be executed as above, or
according to th e laws of th e place of execution.
C o rp o ra tio n s . M ay be organized by any num ber of persons, n ot
less th a n three, for th e purpose of engaging in any lawful business.
T he am ount of capital stock shall in no case be less th a n $10,000,
divided in to shares of n o t less th a n $1.00 or m ore th a n $100. The
incorporators m ust sign and acknowledge a certificate specifying: 1.
th e nam e, general nature of business, and principal place of transacting
th e same. 2. Period of its duration, if lim ited. 3. N am es and places
o f residence of incorporators. 4. In w hat board m anagem ent is
vested, d ate of annual m eeting a t which such board shall be elected,
nam es and addresses of persons composing board until first election.
6. A m ount of capital stock, how th e sam e is to be paid, num ber of
shares and p ar values of each, and if m ore th a n one class, a descrip­
tion, and term s of issue and m ethod of voting of each. 6. H ighest
am ount o f indebtedness to which corporation shall be subject. This
certificate is filed w ith th e secretary of sta te and w ith th e register
of deeds of th e county in which th e principal place of business is
located and published in such county tw o successive days in a daily
newspaper, or tw o successive weeks in a weekly.
E v ery stockholder in any corporation, except those organized for
th e purpose of carrying on a m anufacturing or m echanical business
is liable to creditors of th e corporation in an am ount equal to th e par
value of th e stock owned by him .
Foreign Corporations. E v ery foreign corporation organized for
pecuniary profit before it can tran sact or continue business in th is
S tate, acquire, hold or dispose of property or bring suit here m ust
appoint an agent residing m th e State, authorized to accept service
of process, and m ust file w ith th e secretary of sta te an authenticated
copy of such appointm ent and of Its ch arter and a verified statem ent
showing th e proportion of its capital stock represented by its property
an d business in th is S tate, and upon th a t it m ust p ay a fee. T his a c t
does n o t apply to exclusively m anufacturing corporations, traveling
salesmen soliciting business for non-resident corporations, nor to those
engaged only in the business of loaning m oney or investing in securities,
nor to those organized to raise and im prove live stock, cultivate farm s,
can fru its or vegetables, nor to those whose sole business is transpor­
tatio n of freight or passengers by w ater.
C o u rts . D istrict courts hold one or m ore term s a year in each
organized county, have original jurisdiction in all civil actions a t law
an d in equity, and in all crim inal cases where th e punishm ent exceeds
three m onths’ im prisonm ent or a fine of m ore th an $100.
T he suprem e court has appellate jurisdiction in all cases, b u t there
is no tria l by ju ry in th a t court. I t has original jurisdiction in such
rem edial cases as are prescribed by law.
P ro b ate courts have exclusive jurisdiction of m atters connected
w ith th e settlem ent of estates of deceased persons, minors, and insane
persons. T erm s are held on th e first M onday of each m onth in each
organized county.
M unicipal courts exist in certain cities, and are courts of record w ith
lim ited jurisdiction in civil and crim inal actions.
Justices of th e peace have no jurisdiction in civil actions where th e
am ount involved exceeds $100,
D ay s o f G ra c e are abolished.
D e p o s itio n s m ay be taken a t any place w ithin or w ithout th e
S tate upon notice in writing, stating th e reason for taking th e same,
th e tim e and place, and giving th e opposite p a rty one day for prepa­
ration, and one d ay for every 100 miles, exclusive of Sundays and
th e d ay of service, before any officer authorized to adm inister oaths.
D e s c e n t a n d D is tr ib u tio n o f P ro p e rty . H om estead descends
to surviving spouse for life, rem ainder to children and issue of deceased
children. I f no children or issue of deceased child, th en to surviving
spouse in fee, exem pt from debts n o t a valid charge thereon a t tim e of
in testate’s death. A fter paym ent of debts and certain allowances to
th e surviving spouse o ut of th e personal property, th e residue of the
estate descends as follows: 1. One-third to th e surviving spouse,
balance in equal shares to Children and lawful issue of deceased child
by rig h t of representation. 2. I f no surviving child or lawful issue
of deceased child th e whole estate descends to surviving spouse if
any. 3. I f no issue or surviving spouse, to fath er an d m other in equal
shares, or if b u t one survive, to such survivor. 4. I f no surviving
issue, spouse, fath er or m other, in equal shares to brothers and Sisters
an d lawful issue of deceased brother or sister. 5. I f no issue, spouse,
father, m other, brother, sister, or living issue of deceased brother
or sister, to next of kin, in equal degree, b u t those who claim through
nearest ancestor preferred to those claiming through ancestor more
rem ote. 6. I f no spouse or kindred, to th e S tate.
D ow er is abolished.
E m p lo y e rs L ia b ility A c t. Effective since April 24, 1913.
E x e c u tio n s issue from district courts any tim e w ithin ten years
after judgm ent an d m ay run to any county where judgm ent is docketed,
are returnable in sixty days and m ay be renewed for sixty days a t a
tim e on reuest of judgm ent 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 redem ption by judgm ent debtor or his
assigns w ithin one year from d ate of sale.
E x e m p tio n s . Hom estead outside o f incorporated m unicipality
m ay include eighty acres. I f in incorporated place containing less
th an 5,000 inhabitants, its area shall not exceed one-half acre, and in
larger incorporated places, one-third of an acre w ithout regard to value.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Fam ily pictures, library, musical instrum ents for use of family, wearing apparel, beds, stoves, cooking utensils used by fam ily, other house­
hold furniture n o t 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, tw enty sheep, th e wool therefrom raw or manu­
factured, food for such stock for one y ear’s supply, either provided or
growing or both, one wagon, cart or dray, one sleigh two plows, one
drag,' and other farm ing utensils, including tackle for teams, not
exceeding $300 in value, provisions for debtor’s fam ily for one year’s
support, tools k ep t for purpose of carrying on trade, and stock manu­
factured in whole or in p a rt by debtor n ot exceeding in value $400library of professional m an; presses, type, and tools of publisher of
newspaper, n ot exceeding $2,000, and his stock in trad e n ot exceeding
$400; watch, sewing machine, typew riter, bicycle, seed for use of debtor
fo r one season n ot exceeding certain am ounts an d binding material
sufficient for use in harvesting th e crop raised from such seed; library
and apparatus of college or school; m oney payable to wife or child
from insurance on life of deceased husband or. fath er nor exceeding
$10,000; money or relief from benefit association; money from insur­
ance on exem pt property; wages n ot exceeding $35 for services rendered
during preceding 30 days; b u t all wages paid and earned within said
th irty day period shall be considered a p a rt of (or all) of said exemp­
tion (Chap. 202, Laws 1915.)
H o lid ay s. Ja n u ary 1st, F ebruary 12th an d 22d, Good Friday,
M ay 30th, July 4th, first M onday in Septem ber, Tuesday after first
M onday in N ovem ber each even-num bered y ear (election day),
N ovem ber 11th (Armistice D ay), and D ecem ber 25th are legal holi­
days. Thanksgiving day is so fa r th a t negotiable instrum ents or
contracts due th a t day are payable n ex t succeeding business day.
I n t e r e s t . Six per cent is legal rate, b u t b y special contract any
ra te n ot exceeding 10 per cent m ay be exacted. A fter January 1,
1924 th e m axim um ra te shall be 8 per cent. U surious contracts
are void.
J u d g m e n ts m ay be entered by default in district courts a t expira­
tion of tw enty days after service of summons. W hen docketed in those
courts they become liens upon all real estate of th e debtor in the county
where docketed th en owned by him or afterw ards acquired, and the
lien continues for ten years a fter th e en try of th e judgm ent. Tran­
scripts of judgm ents in justice and m unicipal courts m ay be filed in
district court and there docketed, and th en become lien on real estate;
L ie n s. To preserve a mechanics lien a verified statem ent must
be filed by th e lien claim ant w ithin ninety days after furnishing the
last .item of labor or m aterial in th e office of th e register of deeds of
th e county in which th e im proved prem ises are situated, or if claimed
upon a line of railw ay or its appurtenances w ith th e secretary of state.
T he lien m ay be released by a court order on deposit with the clerk
of th e D istrict C ourt of a sufficient sum of money to protect the lien
claim ant, and anyone interested in th e property m ay bring an action
in th e n atu re of an action to determ ine adverse claims to remove the
lien. Action to foreclose th e lien m ust be commenced within one
year of th e tim e of th e filing of th e verified statem ent.
L im ita tio n o f A c tio n s. On contracts express o r implied six
years; judgm ents te n years; to foreclose m ortgages fifteen years; to
recover real estate, fifteen years. B u t no action shall be maintained
on a judgm ent note, or o ther instrum ent authorizing Confession of
Judgm ent unless begun w ithin one y ear a fter Cause of Action accrued;
and no action shall be m aintained upon any judgm ent of any court of
th e U. S. or of any S tate or T errito ry en tered by Confession under a
w arrant of attorney, unless th e action upon such judgm ent be begun
within one year a fter th e rendition or en try thereof.
M a rrie d W o m e n . P roperty acquired by wife before or after mar­
riage rem ains h er separate estate. I t is liable for h er debts and torts
to th e sam e extent as if she were unm arried, and she m ay make any
contract which she could m ake if unm arried, except th a t no convey­
ance or contract for sale of her hom estead or an y interest therein is
valid unless h er husband joins in th e same.
B oth husband and wife are liable for necessaries furnished to and
used by th e fam ily.
M o rtg a g e s on real estate executed in th e presence of two subscrib­
ing witnesses, acknowledged and recorded in th e office of the register
of deeds of th e county in which th e m ortgaged premises are situated
m ay be foreclosed by publication or by action. The mortgagor or his
assigns m ay redeem w ithin one year from th e d ate of the foreclosure
sale.
T he authority of an atto rn ey conducting a foreclosure by adver­
tisem ent, m ust be in th e form of a Power of A ttorney, executed and
acknowledged by th e m ortgagee or assignee in th e same manner as
a conveyance and recorded prior to th e sale in th e County where
the foreclosure proceedings are had.
T he m ortgagor m ay covenant to pay or authorize th e mortgagee
to retain any atto rn ey 's fee in case of foreclosure of -not exceeding
$25; where th e m ortgage debt does n o t exceed $500; $50 where the
m ortgage deb t exceeds $500 and does n ot exceed $1,000; $75 where
th e m ortgage deb t exceeds $1,000 and does not exceed $5,000; $100
where th e m ortgage d eb t exceeds $5,000 b u t does n o t exceed $10,000:
and $200 where th e m ortgage debt exceeds $10,000. Mortgagor or
subsequent lien holder m ay before foreclosure sale pay debt and costs
in full in which case atto rn ey ’s fee shall n o t exceed fifty dollars.
A Registry Tax of 15 cents is imposed upon each $100 or fraction
thereof of th e principal deb t secured by any m ortgage covering prop­
e rty w ithin th e S tate of M innesota and recorded in said State, m
case th e m atu rity of any portion of th e d eb t so secured shall be fixed
a t a date m ore th an five years a fter th e date of said mortgage, the
am ount of such R egistry T ax shall be a t th e rate o f 25 cents on each
$100. N o such m ortgage or assignm ent or satisfaction thereof or
papers relating to its foreclosure, shall be recorded or registered unless
such tax has been paid, nor shall any such docum ent or record thereof
be received in evidence in any court or have any validity as notice or
otherwise. I f such m ortgage describe real estate outside of Minne­
sota, such tax shall be imposed upon such proportion of the whole
d eb t secured as th e value of th e real estate described in this state
bears to the value of th e whole real estate, such value to be deter­
m ined by thie S tate A uditor upon application of th e .mortgagee.
N o tes a n d B ills of E x c h a n g e . Uniform negotiable Instruments
Law has been in force since April 15, 1913. Commercial paper is
payable a t the tim e fixed therein w ithout grace. When due or pay­
able on Saturday or on Sunday, or any legal or bank holiday, tne
sam e is payable upon th e business day next succeeding, and may
be protested on such succeeding day.
B ig h t to H o ld P ro p e rty . N o person unless he be a citizen of the
U nited States, or has declared his intention to become a citizen, ano
no corporation unless created under th e laws of th e United States, or
of some sta te thereof, shall acquire lands exceeding 90,000 square reet,
except by devise, inheritance, or through security for mdebteaness.
T his does n ot apply to actual settlers on farm s n o t exceeding 160 acres,
or to subjects of a foreign country, whose rights to hold Ianas are
secured b y treaty .
, .
j hv
N o corporation, m ore th an 20 per cent of whose stock is ownea oî
persons n ot citizens of th e U nited States, or by corporations no
created under its laws, or those of some sta te thereof, can acquu
lands, and no corporation unless organized for th e construction «
operation of a railway canal or turnpike can acquire more than
acres or m ore th an is necessary for its operation, and lands grant«
it by th e S tate dr U nited States.
„
.
B u t th is does n ot apply to lands acquired in th e collection or ueo
nor to a person or corporation engaged in selling lands to acu
settlers, or engaged in m anufacturing in M innesota while so
Such persons or corporations not so engaged m ust sell w hat tney n
April 13, 1911, w ithin ten years from th a t d ate and sell what t *
acquire subsequent to th a t date within ten years after th ey acquire

B A N K IN G A N D C O M M E R C IA L L A W S— M IS S IS S IP P I
S ales o f G o o d s. T he Uniform Sales A ct becam e effective April
20, 1917.
S e c u ritie s C o m m is sio n . See Blue Sky Law.
T axes. 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 co nstitute a prior lien. L and on which taxes
not paid sold on second M onday in M ay each. year. R edem ption m ay
be m ade sixty days after service of notice of expiration of redemption!
this notice cannot be served until th e expiration of three years after
sale. Person redeeming m ust pay original tax penalties an d interest
at th e rate bid a t th e sale and in addition thereto costs. O ne-half of
real estate taxes m u st be paid June 1st and if not, penalty of 5 per
cent and 1 per cent per m onth until Novem ber 1st attaches. Second
half m ust be paid N ovem ber 1st, and if n ot th en paid, a penalty of
10 per cent attaches. In fants and persons of unsoim d m ind m ay re­
deem within one year after such disability shall cease/b u t th e right to
redeem m ust be established in a suit in court. M oneys and credits
are subject to an annual tax of three mills on each dollar of the fair
cash value thereof. M oneys and credits belonging to incorporated
banks located w ithin th e sta te are exem pt. Real estate* m ortgage
maebtedness is exem pt from th e m oneys and credits tax; b u t is taxed
under th e m ortgage registry tax law a t th e ra te of 15 cents per hundred,
except where th e indebtedness or a portion thereof runs for a longer
period th an five years an d sixty days, in which event th e rate on such
indebtedness or portion is 25 cents per hundred.
W ills. E very person of full age and sound m ind m ay 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 tw o or more com petent witnesses. E very person includes
married women. If, after m aking a will th e testa to r m arries, th e will
is thereby revoked.

S Y N O P S IS OF

THE LAW S OF MISSISSIPPI
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Prepared and Revised by C h a m b e r s & T b b n h o l m ,
A ttorneys a t Law, Jackson.
(See Card in A ttorneys’ List.)
A cco u n ts. Sworn to entitles plaintiff to judgm ent, unless defend»nt files affidavit denying. T he affidavit m ust be by th e creditor or
nls agent. All accounts m ust be item ized.
A c k n o w led g m en ts before any judge, clerk of a court of record
under his seal, justice of the peace, notary public, or m em ber of th e
board of supervisors, before any police justice, or m ayor of any city
town, or village. Acknowledgments in another sta te m ay be before
“ y or the. judges of th e suprem e court, or an y district judge of th e
united States, or a judge of th e suprem e or superior court in any sta te
or territory, an y justice of th e peace, whose official character shall
be certified to under th e seal of some court of record in his county
or by any commissioner residing in such sta te or territory, appointed
by the governor of Mississippi, or a n otary public or a clerk of a court
of record having a seal or office. Acknowledgments or proof of
aeeds to p roperty in th is S tate by persons in a foreign country m ay be
made before an y court of record, or th e m ayor or chief m agistrate
of any city, borough, or corporation where th e grantor or witnesses
reside, or m ay be, o r before any commissioner appointed by th e gov­
ernor of th is S tate, or before an y am bassador, foriegn m inister, secr®tary of legation, o r consul of th e U nited States. T he certificate
snail show th a t th is p a rty or p arty and witness were identified before
the officer, an d th a t th e p a rty acknowledged th e execution of th e
instrument, or th a t th e execution was duly proved by th e witness or
witnesses. Acknowledgment m ust sta te th a t p a rty “ acknowledged
that he s ig n e d a n d d e liv e r e d ” instrum ent.
. A ctio n s. All distinction as to forms abolished. Service five days
before retu rn day. All action triable in the circuit court a t first term
in which th e defendant has been personally served w ith process th irty
flays before th e retu rn day. M andam us, quo w arranto, m echanics’
liens, attachm ents, and replevin triable a t retu rn term on five days
notice.
A d m in is tr a tio n o f E s ta te s . H ad in chancery court, according
to will, if any. Claim s against deceased m ust be registered within
six m onths after th e first publication of notice to creditors; registra­
tion stops th e general s ta tu te of lim itations. All debts are to be paid
before heirs, distributors, or legatees. Claims against insolvent
estates are paid pro rata.
A ffidavits o r O a th s before a judge of any court of record, clerk of
such court, m aster in chancery, m em ber of th e board of supervisors
justice of th e peace, n o tary public, m ayor, or police justice of a city ’
P L village; in another sta te by any officer thereof, or of the
united States, authorized to adm inister oaths.
A liens. N o restrictions on th e rights of resident aliens to acquire
property or dispose of it. N on-resident aliens can n o t hold land, b u t
may tak e hens thereon to secure debts and purchase a t foreclosure
were of, and th ereafte r hold it for n ot longer th an tw enty years, with
Power to sell to a citizen in fee; or he m ay retain it by becoming a
citizen. See title “ C orporations.”
A ppeals from justice co u rt to circuit court w ithin ten days. Prom
circuit an d chancery courts to suprem e court w ithin one year, b u t
notice to stenographer m ust be given w ithin te n days a fter adjourn­
ment of C ourt, in order to incorporate evidence in record. Appeals
also in certain cases from board of supervisors and m unicipal courts.
A rb itra tio n . P arties m ay subm it to arbitration of one or more
m sinterested arbitrators, w ith agreem ent th a t proper court shall enter
Judgment.
A rrests m ade b y certain officers, or private persons m ay arrest for
debt86 comBQ~ ^ec^
bis presence. N o arrests or im prisonm ent for
A ssig n m en ts a n d In so lv e n c y . N o insolvent law. An assign­
ment m ay be m ade for th e benefit of creditors. D ebtor, though
msoivent, m ay prefer creditors, if in good faith and no benefit, direct
w indirect, is reserved. No provision for th e discharge of a debtor
mi his m aking an assignm ent. In general assignments, Where the
m ue exceeds $1,000, th e assignee m ust give bond and adm inister
me tru st in chancery. Preferences n ot prohibited. Practically super­
seded b y b an k ru p t law.
A tta c h m e n t. Against a debtor who is a non-resident or who
removes or is abo u t to remove himself or property o ut of th e State:
wno so absconds o r conceals him self th a t he cannot be served w ith a
summons: or who incurred th e debt in conducting th e business of a

Digitized for112
FRASER
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1761

ship steam boat or other w ater craft in some of th e navigable waters
or this S tate; or who assigns or disposes of his property, or some p a rt
thereof, or is about to assign or dispose of his property w ith in ten t to
defraud his creditors; or who has property or rights in action which
he conceals and unjustly refuses to apply to th e paym ent of his debts;
or who has converted or is about to convert his property into m o n e y
or evidence of debt, w ith th e in ten t to place it beyond th e reach of
creditors; or who has fraudulently contracted th e d eb t or incurred
th e obligation for which suit has been or is about to be brought, m ay
D6(attached. In addition to those nam ed above, th e following grounds
exist: ‘9. T h at the defendant is buying, selling, or dealing in, or
has within six m onths next before th e suing out of th e attachm en t
directly or Indirectly, bought, sold, or dealt in future contracts, com­
monly called ‘futures.’ 10. T h a t he is in default for public money,
due from him as a principal, to th e S tate, or some county, city, town, or
village thereof. 11. T h a t defendant is a banker, banking comany,
?£ corporation, and received deposits of money, knowing a t th e t.im«
th a t he or it was insolvent, or has m ade or published a false or fraudulent statem ent as to his or its financial condition.” A ttachm ents for
debts n o t due allowed for last six grounds-—or when th e creditor has
ju st cause to believe th a t th e debtor will rem ove him self or his effects
out of S tate before d eb t w ill.be due, w ith in ten t to defraud. Non­
resident creditors have th e sam e rights of attachm ent as resident
creditors, w hether th e debtor be resident or non-resident. Plaintiff
m ust furnish bond double th e deb t and make affidavit as to one or more
p o u n d s. Suit does n ot ab ate on verdict for defendant, on a plea deny­
ing grounds; b u t judgm ent on th e debt, to be offset by dam ages in
favor o f’defendant for wrongfully suing o ut attachm ent. A ny credi­
tors m ay intervene and contest ground of attachm ent.
A u a c n m e n t i n ( jn a n c e ry on bill against th e property, or debts
of an absent, non-resident, or absconding debtor. A lien is acquired
by th e suit. I f a w rit for th e seizure of goods is obtained, bond is
required. Available to non-residents.
-mo uuuMu- ui any cxiecK, araic or order, on
a bank or depository, given for a present valuable consideration, is
subject to fine or im prisonm ent if he fails to m ake the sam e good
^ t h i n ten days after receipt of w ritten notice of its dishonor, and m ay
be prosecuted where he delivered th e check or where the bank is located.
B a n k s. Required capital stocks as follows: In cities, villages,
ana com m unities w ith population 1,000 or less, $10,000; population
1,000 and not more th a n 2,500, $15,000; population 2,500 and not
more th an 6,000, $25,000; population from 6,000 to 10,000, $35.000*
JOjOOO or more, $50,000. T his does n ot apply to existing banks of
(1914). T here shall be a board of bank exam iners of three m en to
be elected, duties to enforce banking laws and examine banks period­
ically. Beginning in January, 1924, th e B oard of three is replaced
by a Superintendent of B anks,” elected by th e Banks of th e State
to be assisted by examiners. Deposits guaranteed; depositors nam es
n ot to be divulged; Banks penalized for failure to comply w ith orders
of exam iners; Banks m ust h a v e a t least three directors; unlawful for
any banks to receive, deposits for six m onths in excess of te n tim es its
paid up capital and surplus; Banks officers m ust n ot contribute to
cam paign fund of candidates.
AD, except national banks, are required to m ake a report, n ot less
th an four tim es each year, to th e commissioner. And th e commis­
sioner shall m ake requisition on all banks for these reports to be
m ade as of dates prior to th e date of th e requisition, and such d ate
to be known only to himself. Such reports shall be verified and «eg»
be published in fuU in a newspaper of the town or city where th e
bank is located. Resources and liabilities shah be sta te d in such
reports. Banks, collecting drafts w ith biD of lading attached m ust
hold funds a t least ninety-six hours. Banks m ust give notice to
adm inistrator or executor of deceased persons of deposits of money
and papers held for th e deceased. Directors of every bank to hold
a t least three regular m eetings each year and keep a com plete record
of aU Proceedings. E very bank w ith paid up capital or as m uch
as $100,000 m ay do business as tru st com pany; m ay a c t as a guardian,
receiver, etc.; m ay execute bonds in legal proceedings an d generally
perform th e duties of a tru st com pany; m ay establish a special m utual
loan departm ent; in such departm ent interest on loans not to exceed
8 per cent per annum . Bank n ot perm itted to aUow th e use of
Its nam e by others in m aking loans.
Banks are authorized to charge exchange of n ot exceeding onete n th of one per cent on “ cash ite m s” and never less th an ten cents,
and shah charge exchange on checks and d rafts payable to non­
residents, except th e U nited States. Cash item s shaU n ot be pro­
tested for non-paym ent of exchange, b u t paym ent m ay be refused
unless exchange is paid.
B lu e S ky L aw . U nder th is sta tu te, certain statem ents, reports,
etc., m ust be m ade to the Secretary of State, and a perm it received
before th e sales of stock in certain corporations. Since it is n ot th è
class of corporation, or th e object for which it is incorporated, th a t
determ ines w hether it is subject to this act, b u t th e prom otion fees
commissions,' etc., th a t are to be paid out of th e capital subscribed’
it is best th a t every corporation have its counsel examine this law
and determ ine for itself w hether it should comply.
C h a tte l M o rtg a g e s a n d D eeds o f T r u s t m ay be executed and
recorded as other m ortgages. Foreclosure is usuaUy by tru stee’s sale.
I f property be rem oved to another county, m ortgage m ust be there
recorded within twelve m onths to affect purchasers w ithout notice.
M ortgages on property to be acquired are valid, b u t n ot on a changing
stock of goods if th e m ortgagor rem ain in possession and continue
busmess. Reservation of title b y th e seUer of a chattel to secure
purchase m oney is valid w ithout record, even against purchasers
w ithout notice, except as to chattels used or acquired in the business
of a trader. ’ Banks, professional m en and m anufacturers, are not
traders.
C o lla te ra ls. General law prevails.
C o n tr a c ts for sale of land, o r for lease for more th an one year,
to be in writing. Same in regard to sale of chattels of the value of
m ore th an $50, unless delivery in whole or in p a rt is m ade, or pay­
m ent in whole or p a rt is m ade. Dealing in futures is forbidden and
a ground for attachm ent. Gam bling contracts and ordinary contracts m ade on Sunday void. C ontracts by foreign corporations
who have n ot complied w ith registration of charter law are void.
• ®on,v ey an ce s. M ay vest title presently or in future. All estates
in land greater th an for one year m ust be by deed, and to affect p ur­
chasers w ithout notice m ust be recorded. Corporations m ust file all
deeds to them in sixty days. E states tail prohibited, except th a t a
deed or devise m ay be m ade to a succession of living donees n o t
exceeding two and to th e heirs of the body of the rem ainderm an, or,
m default thereof, to th e rig h t heirs of th e donor in fee. C orporations
convey under seal. In all other cases private seals abolished. Con­
veyances or devises to two or more, or to husband and wife, create
tenancy^ in common. Rule in SheDy’s case abolished. R em ainder
good w ithout particular estate. T he words “ grant, bargain, and
Sell operate as a covenant th a t grantor is seized of some estate of
inheritance. W ords “ convey and W arrant” operate as a general
covenant of w arranty. The words “ convey and w a rra n t specially”
operate as a w arranty only against the grantor or those claiming
under him . A quitclaim deed has practically th e sam e effect. Hus­
band and Wife, if living together m ust join in Conveyance or incum ­
brance of hom estead of either, or it wiU be void as to aH under $3,000.
C o rp o ra tio n s . C orporations except for th e construction and
operation of a railroad o ther than street railroads, and th e carrying
on of an insurance business, other th an m utual insurance, m ay be
created under a general charter.
Application for charter signed by each of th e incorporators and
acknowledged. , I t m ust than be published three consecutive weeks

1762

B A N K IN G A N D C O M M E R C IA L L A W S— M IS S IS S IP P I

in a newspaper published a t th e domicile of the proposed corporation.
T he application w ith proof of publication, m nst be forwurded to th e
secretary of sta te together w ith th e fee for recording, and he m ust
refer th e sam e to th e atto rn ey general for his opinion as to th e con­
stitu tio n ality and legality of th e proposed corporation, after which
it is referred to the governor for his approval or disapproval. The
governor th en returns it to the secretary of sta te with his action
endorsed thereon. If he approve it, the secretary of sta te shall record
it in his office and certify to th e sam e and transm its it to the applicants.
I t m ust be recorded in the office of th e clerk of th e chancery court of
th e county in which th e corporation shall do business. W ithin th irty
day s after the organization, the corporation m ust m ake report of
th e organization to the secretary of state. If such report be not m ade
th e charter granted shall be void, and all persons doing business
thereon shall be deemed partners in the business, and liable as such
Corporations thus created possess th e powers usual and incident
to private corporations generally, b u t existence is restricted to fifty
years. Corporations created as above nam ed m ay hold real property
necessary for th eir purposes, n ot exceeding one million dollars, m anu­
facturing com panies and banks excepted, which m ay hold porperty
to th e am ount n ot exceeding two million dollars. Corporations m ay
owh such personal property as m ay be necessary to th eir business.
U nder the laws passed by the Legislature of 1912 all corporations,
w hether dom estic or foreign, are not allowed to acquire title in fee,
or for a term of years, to, or own land for agricultural purposes, in
this S tate outside of an incorporated city, town, or village. A cor­
poration m ay be lessor or lessee for not more th an tw enty years of
as m uch as 10,000 acres of land to be used for agricultural purposes,
b u t an y such lease or Contract shall not be renewed or extended so
as to authorize th e holdings of said lands for another period.
This law does not prevent corporations from taldng deeds of tru st,
or m ortgages on real estate to secure loans or debts, or from acquiring
title th ereto upon foreclosure of such securities or from acquiring
title to land by deed for th e collection of debts, and th a t all lands so
acquired m ay be used and operated after foreclosure for all agricul­
tural purposes during th e tim e so held for not longer than tw enty
years. By am endm ent of 1922 corporations are perm itted to develop
cu t over pine lands up to 20 per cent of their buildings in any one
county or to 50 per cent if 20 per cent Js less th an 1000 acres.
I t is also the duty of every corporation th a t shall acquire interest
in or title to land in this S tate to file the deed to sam e in th e office
of th e Chancery Clerk of the county in which such land, or a p a rt of
it, is located within sixty days after the date of the deed.
If any corporation or other person shall have acquired any right,
title or in terest in any land in violation of this Act, th ey shall be dis­
solved by a suit brought by the A ttorney General of the S tate or by
th e D istrict A ttorney, if it is a domestic corporation, and if a non­
resident corporation they shall not be perm itted to do business in
this S tate, and the court shall thereafter appoint a receiver to take
charge of all property in this S tate belonging to such corporation or
so held in tru st and to dispose of the sam e under order of th e court,
and after paying all debts of the corporation and all costs and charges
Incident to said suit, the rem aining shall be paid and distributed to
the stockholders.
T his A ct does not affect th e rights of existing corporations in this
S tate, h u t is passed to prevent a monopoly in agricultural lands.
Stockholders individually liable for the debts the corporation con­
tracted during his ownership of stock for th e balance th a t m ay rem ain
unpaid for stock subscribed for and m ay be sued by any creditor.
Directors are liable for the wilful m ism anagem ent or for allowing
capital w ithdraw n while debts exist. Corporations under the laws
of o th er states or of foreign countries m ay sue in this S tate, and have
th e same rights in the S tate as non-resident individuals. The legis­
lature m ay repeal or am end charters granted after N ovem ber 1, 1890,
provided rights of stockholders are not infringed. All foreign cor­
porations doing business in th is sta te shall file a certified and duly
authenticated copy of its ch arter or certificate w ith the secretary of
state. C harter m ust be certified by the president and secretary or
other chief executive under the corporate seal. Fees are to be paid
according to capital stock, viz. : $10,000 and under, $20.00. Between
$10,000 and $30,000, $40.00. Betw een $30,000 and $50,000, $60.00.
When over $50,000, one-tenth of one per cent and n ot to exceed $250.
C o sts. Non-resident or insolvent plaintiff required to give security
though an insolvent m ay sue in form a pauperis.
C o u rts . T erm s and Jurisdiction. Justices’ courts m eet twice each
m onth; circuit and chancery courts in each county twice a year;
suprem e court twice a year in October and M arch. Justices’ courts
have jurisdiction up to $200. Circuit courts have general jurisdiction
of all common law actions where the am ount or value exceeds $200,
and jurisdiction of appeals from justices’ and m ayors’ courts, and
boards of supervisors. Chancery courts have jurisdiction of the
adm inistration of estates of deceased persons, of m inors’ business and
other probate m atters, and of all m atters in equity. Appeals m ay be
taken to th e suprem e court from any final judgm ent of th e circuit
court, and from th e chancery court, except in suits for not more than
$50 originating in the justice’s court. Suits of equitable cognizance
Improperly brought in th e circuit court are transferred to chancery
court, and vice versa. ,No suit dismissed because being of an equitable
nature it is im properly brought in th e circuit court and e con verso.
C r e d ito r ’s B ills m ay be filed under general Laws to subject equi­
table assets and in aid of execution a t law. Such suits m ay, under the
sta tu te, be filed to subject property of a debtor fraudulently conveyed
without a judgm ent and retu rn of nulla bona ; and this w hether com­
plainant’s debt is due or not. No bond is required unless a sequestra­
tion is desired.
C u rte s y a n d D ow er. B oth abolished since 1880.
D eeds. (See Conveyances.)
D ep o sitio n s in civil cases, on w ritten or verbal interrogatories;
ten days’ notice to opposite party. If such p arty is absent and has
no atto rn ey , filing interrogatories ten days sufficient. The officer
shall swear the witness to testify the tru th , and shall im partially
examine him on the interrogatories. T he testim ony shall be fairly
w ritten down by the officer or witness, or by a disinterested person in
the presence of, and shall be subscribed by the witness. Depositions
then certified, and transm itted by mail or other safe and convenient
m anner to the court where the sam e are to be used. Officer’s cer­
tificate prim a facie evidence of his character.
D escen t a n d D is tr ib u tio n . E states of inheritance, real and
personal descend. 1. To children and their descendants per stirpes.
2 To brothers and sisters and father and m other in equal parts and
their descendants by representation. 3. To th e next of kin according
to th e civil law. Except among brothers and sisters there is no
representation among collaterals. Advancements m ust be brought
into hotchpot. No distinction between children of the whole blood
and those of the half blood, except th a t children of the whole blood are
preferred to those of the half blood in equal degree. Where there is
no one to inherit property escheats. Illegitim ates inherit from the
m other and from her other children and her kindred. Children of
Illegitimates and their descendants inherit from brothers and sisters
of th eir father or m other and from grand parents. B ut children of
Illegitimates do not inherit from any ancestor or collateral kindred if
there be legitim ate heirs of such ancestor or collateral kindred, in the
sam e degree. The m other of an illegitim ate and her other children,
legitim ate or otherwise, inherit from the illegitimate. E xem pt prop­
erty of husband or wife descends to survivor and children as tenants
in common.
D ow er a n d C u rte s y have been abolished since 1880.
E v id en ce. In the main common law rules apply. Parties and
interested persons com petent; except against decedent. Affidavit to
open account entitles to judgm ent, unless defendant denies under
oath. Warehouse receipts and bills of lading conclusive evidence m
favor of a bona fide holder th a t the property was received by the
issuer. (See also Accounts and Affidavits.)


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

E x e c u tio n s in circuit court issue within tw enty days after the
adjournm ent of court unless otherwise ordered by th e plaintiff, and
In justices courts after the lapse of ten days from judgm ent rendered
unless recovering p arty m akes affidavit th a t he is in danger, by delay’
of losing his debt or dem and, in which case execution issues forthwith!
No redem ption of property sold under execution or m ortgage.
E x e m p tio n s . T he following personal property is exem pt from
seizure under execution or attachm ent, to-w it:
The tools of a mechanic necessary for carrying on his trade.
T he agricultural im plem ents of a farm er necessary for two male
laborers.
T he im plem ents of a laborer necessary in his usual employment.
T he books of a student required for the completion of his educa­
tion.
The wearing apparel of every person.
The libraries of all persons, including pictures, drawings, and paint­
ings, not exceeding five hundred dollars in value; also th e instruments
of surgeons and dentists, used in their profession, not exceeding two
hundred and fifty dollars in value.
The arm s and accoutrem ents of each person of th e m ilitia of the
S tate.
All globes and m aps used by the teachers of schools, academies, and
colleges.
The following property of each head of a family, to be selected by
th e debtor, is exempt.
Two work-horses or mules, and one yoke of oxen.
Two head of cows and calves.
T en head of hogs.
T w enty head of sheep and goats each.
All poultry.
All colts under three years old raised in this State by the debtor.
Two hundred and fifty bushels of com .
Ten bushels of w heat or rice.
Five hundred pounds of pork, bacon, or other m eat.
One hundred bushels of cotton seed.
One wagon, and one buggy or cart, and one set of harness for each.
Five hundred bundles of fodder and one thousand pounds of hay.
F orty gallons of sorghum or molasses or cane syrup.
One thousand stalks of sugar cane.
One molasses mill and equipm ents, not exceeding one hundred and
fifty dollars in value.
Two bridles and one saddle, and one side saddle.
One sewing m achine.
Household and kitchen furniture not exceeding in value two hun­
dred dollars.
All .fam ily portraits.
One mower and rake for cutting and gathering hay or grain.
And th e following property shall be exempt from garnishment or
o ther legal process, to-wit:
T he wages of every laborer or person working for wages, being the
head of a family, to th e am ount of fifty dollars per m onth, but this
paragraph shall not apply to a debt for board and lodging or a judg­
m ent founded on a deb t for board and lodging.
The proceeds of insurance on property, real and personal, exempt
from execution or attachm ent, and the proceeds of the sale of such
property.
P ayable to Executor. Life insurance policy n ot exceeding five
thousand dollars, payable to th e executor, or adm inistrator, shall
inure to the heirs or legatees, freed from all liability for the debts of
th e decedent, except prem iums paid on the policy by anyone other
th an the insured and debts due for expenses of last illness and for
burial; b u t if the life of the deceased be insured for the benefit of his
heirs or legatees a t the tim e of his death otherwise; and they shall
collect the sam e, th e sum collected shall be deducted from the five
thousand dollars, and th e excess of the latter only shall be exempt.
Life insurance policy to am ount not exceeding $10,000.00 goes to
parties nam ed as beneficiaries free from liability for debts of insured.
Hom estead in C ountry. E very citizen being a householder, and
having a family, shall be entitled to hold exem pt the land and build­
ings owned and occupied as a residence, b u t the q u an tity shall not
exceed one hundred and sixty acres, nor th e value thereof, inclusive
of im provements, save as hereinafter provided, th e sum of three
thousand dollars.
Hom estead in Cities. E very citizen being a householder, and hav­
ing a family residing in any city, town, or village, shall be entitled
to hold, th e land and buildings owned and occupied as a residence by
such person, not to exceed in value, save as hereinafter provided,
three thousand dollars, and personal property, to be selected by
him, not to exceed in value two hundred and fifty dollars, or the
articles specified as exem pt to the head of a family.
Hom estead exemption m ay be increased to $3,000 in value by
filing for record in chancery clerk’s office a declaration claiming ax
exem pt certain property.
No property is exem pt as against purchase money or for labor per­
formed on it or materia] furnished therefor. M oney loaned at rates
of interest not exceeding 6 per cent is exem pt from taxation.
F o re ig n C o rp o ra tio n s m ay do business and sue and be sued as
in case of domestic corporations. (See Corporations.) 5 Foreign
corporations doing business in the S tate w ithout recording their
charters are subject to fine; and all contracts are null and void.
F ra u d a n d F r a u d u le n t C o n v ey an ces. (See Attachm ent, Bills
of Lading, Lim itations, C reditor’s Bill.)
Sales of merchandise otherwise than in usual course of business and
sales of entire stock of goods in gross presum ed fraudulent and void as
to creditors, unless 5 days before sale, seller m ake complete inventory
and the purchaser m ade dem and of seller for name, address and amount
of claim of each creditor, and the purchaser notified personally o L p |
mail each of creditors of proposed sale and of cost price of merchandise
and the price to be paid therefor. Purchaser violating this act held
to be trustee for seller’s creditors to extent of reasonable value of
goods and required to pay them to th a t am ount, even if he has paid
seller in full.
,
In case of destruction of stock of merchandise by fire, on which mere
is insurance, holder of policies to notify creditors be owes for merchan­
dise of his loss and am ount of insurance carried, within 5 days.
G a r n is h m e n t on judgm ents or in attachm ent. Binds debts or
property of debtor in garnishee’s hands.
G race.

Abolished.

H o lid ay s are Jan. 1, Feb. 22, April 26. June 3, Ju ly 4 , first Monday
In Septem ber, fourth Thursday in Novem ber, and December zo.
Instrum ents falling due on a Sunday or holiday are payable on tne
next succeeding business day. Instrum ents falling due on saturuay
are to be presented for paym ent on the next succeeding business aay
Bxcept th a t instrum ents payable on dem and m ay a t th e option raw »
holder be presented for paym ent before twelve o’clock noon on Satur­
day when th a t day is not an entire holiday.
H o m e s te a d owned and occupied by husband living with vsdfe cannot
be sold or encum bered unless the wife joins in th e conveyance, i _
same is true as to husband if wife owns hom estead. (See j u x e w
tions.)
H u s b a n d a n d W ife. T he disabilities of coverture are abolished,
as are dower and curtesy. Husband and wife m ay contract
_
and sue each other, b u t contracts for com pensation for service
iered to each other are void. If h u s b a n d rents wiffi s land, u ^
etc., and does business in his own name, it will be deem ed ha recorded,
of the wife as to those without notice, unless the contract be rec “
Transfers between are void as to third persons unless recorded,
also M arried Women, Wills, and Homestead.)

B A N K IN G A N D C O M M E R C IA L L A W S— M IS S O U R I
Insolvency. No general insolvent laws, b u t insolvent estates of
decedents are divided among creditors pro rata.

In case of insolvency partnership property is applied first to partner­
ship debts, and e converso.
Interest. Legal rate 6 per cent per annum , and money loaned a t

not exceeding th a t rate is exem pt from any taxes, b ut parties m ay
contract in w riting for 8 per c e n t; when more is stipulated or collected
all interest is forfeited. W hen above 20 per cent interest and prin­
cipal forfeited and paym ents forfeited.
Judgments enrolled become liens on defendant’s property w ithin
the county. A junior judgm ent creditor m ay obtain priority as to
property levied on by him, if, after ten days’ notice, th e senior judg­
ment creditors fail to issue executions. Lien of judgm ent continues
seven years.
Jurisdiction. (See Courts.)
Liens. Lien of an enrolled judgm ent, of mechanics and m aterial
men, of landlord and laborer on agricultural products, innkeeper’s
and stablekeeper’s lien, and lien of saw mill laborer. The seller of
goods may enforce lien for th e price of the same, provided th e goods
are still in th e hands of th e purchaser or one having notice. The
procedure is by affidavit, filed a t the com m encement of th e suit,
stating th a t th e purchase money is unpaid. A w rit of seizure issues,
and the goods are taken. N o bond required of plaintiff unless third
person claims th e property. T itle to personal property m ay be reserved
by the seller as security for the price, and this is good even as against
a subsequent bona fide purchaser, w ithout any writing or record,
except where acquired or used in the business of a trader.
L im ita tio n s. Open accounts, accounts stated, and verbal con­
tracts, express or implied, three years; all other contracts, six years
awards of arbitrators, six years; judgm ents and decrees rendered in
another state against resident of this, three years; rendered in this,
seven years, real actions, ten years. Actions to recover property
sold under order of chancery court m ust be brought within two years,
where possession is taken and purchase money paid in good faith.
When the legal title to property or right in action is in an executor,
guardian, or other trustee, beneficiary, though under disability, is
barred when tru stee is barred. Action against adm inistrator or
executor on claim against person deceased lim ited to four years from
date of qualification of such adm inistrator or executor. S tatute does
not apply to suits on notes or evidences of debt of banks or other
moneyed corporations circulating as money. An acknowledgment or
new promise m ust be in writing. S tatu te does not run during frau d­
ulent concealment, nor against infant or person non compos m entis,
nor against a convict in actions for assault, etc., until a fter release
nor against State, county, m unicipality, or any political subdivision
of State, nor in favor of persons who remove from the state.
M arried W o m en retain their estate, common law disabilities of
coverture abrogated; have capacity to m ake contracts and do all
acts in reference to property. Dower and curtesy abolished. H us­
band and wife m ust join in conveying or encum bering hom estead.
(See also H usband and Wife and Descent.)
M ortgages a n d T r u s t D eeds do not take effect as to creditors or
purchasers in good faith and without notice until they are delivered
to the clerk for record; w ith power of sale are foreclosed by sale in
pais; without power of sale, by suit in chancery court, and after fore­
closure there is no redem ption. (See C hattel M ortgages.)
Notaries. H ave power to adm inister oaths, take acknowledgments
and to protest notes and bills. (See Conveyances.)
Notes a n d B ills. Uniform Negotiable Instrum ents Law adopted
and now operative. (See Holidays.)
P a rtn e rsh ip . Pew statu to ry provisions. Governed by general
law. In case of insolvency, partnership property m ust go to pay
Arm debts, and e converso.
Provision m ade for lim ited or special
partnerships.
Powers of A tto rn e y . M ay be acknowledged or proved and
recorded as deeds. M ay be revoked in like m anner. Conveyances
of land or other property under powers of attorney are valid.
R e d em p tio n . N o'redem ption from sales under mortgage, execu­
tion, or other judicial sale. Two years allowed for redem ption of
land sold for taxes, saving to minors and persons non compos m entis
a like period after removal of disability.
Replevin lies to recover personal property wrongfully withheld
from the owner. The property m ay be restored to defendant on bond.
If he declines to bond, plaintiff may do so. If neither does, a claim ant
of the property m ay give th e bond and receive possession. Damages
may be assessed for wrongful taking or detention.
Taxes. Personal property is assessed once a year; real estate
every two years, and taxes constitute a prior lien. Land delinquent
sold on first M onday of April. Redem ption within two years, on
payment of all taxes, costs, 25 per cent damages, and 5 per cent on
amount paid. Infants and persons of unsound mind m ay redeem
within two years after removal of disability, on paying the value of
permanent im provements p u t on the land after two years from date
of sale. Money on deposit in banks and tru s t companies exem pt
frbm taxation.
T rust C o m p a n ie s. Provision for such companies with general
owers—to adm inister all trusts, m ake bonds and the like. (See
anks.)
W arehouse R e c e ip ts. (See Bills of Lading.)
Wills executed by anyone tw enty-one years old. of sound m ind.
As to land, if n ot wholly w ritten and subscribed by testator, m ust be
attested by two subscribing witnesses. A nuncupative will (of per­
sonalty) may be m ade during last sickness of testa to r a t habitation,
or where testato r has resided ten days next before death, or where
person is taken sick from hom e and dies before return, m ust be proved
by two witnesses. N uncupative wills n ot to be established where value
bequeathed exceeds $100. Soldiers and sailors in actual service m ay
bequeath personalty free from sta tu to ry restrictions. No restriction
upon the power to dispose of property by will except th a t religious or
charitable tru sts or bequests void. Provisions m ade for renouncing
kill by surviving husband or wife in certain cases. Probated in com­
mon form m ay be contested w ithin tw o years. One who kills another
cannot take under his will.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1763

S Y N O P S IS OF

THE LAW S OF MISSOURI
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised by A s h l e y & G i l b e r t , A ttorneys a t Law, 5 0 2 -6 R ialto Bldg.,K ansas City.
A c k n o w le d g m e n ts. Acknowledgments of instrum ents affecting
real estate m ay be before one of the following courts or officers. 1.
W ithin this State, some court having a seal, or some judge, justice or
clerk thereof, a notary public, or some justice of the peace of the
county in which the real estate is situated. 2. O utside of this State
and within the United States, any notary public, any court having a
seal or the clerk of such court, or commissioner of deeds. 3. W ithout
the U nited States, any court having a seal, the m ayor or chief officer
of any city or town having an official seal, any m inister, consul 6r
officer of th e U nited States, or notary public having a seal. The
official should certify th a t “ before me personally appeared . . . .
a n d ................ his wife, to me known to be the persons described in,
and who executed the foregoing instrum ent and acknowledged th a t
they executed the same as their free act and deed.” Persons engaged
in m ilitary service w ithout th e U. S. m ay acknowledge any instru ­
m ent requiring it, before any officer above th e ran k o f lieutenant;
in the naval service, before any officer above ensign.
A ctio n s. T here is in this State b u t one form of civil action the
practice being under a code. A non-resident plaintiff m ust file the
w ritten undertaking of some resident for costs, or m ake a cash deposit.
A d m in is tr a tio n of E s ta te s . The probate court in each county
has jurisdiction of th e settlem ent of the estates of deceased persons.
Claims presented to the court for allowance within six m onths after
the grant of letters are preferred over those presented later. Claims
not presented within one year from the granting of letters are barred.
L etters are granted: 1. To th e husband or wife. 2. To those entitled
to distribution, or one or more of them . I f after the expiration of
th irty days after d eath of deceased, such persons do not, on five
days’ notice, appear and qualify, letters m ay be granted to any other
person. Non-residents cannot be executors or adm inistrators, nor
m ay non-resident executors or adm inistrators m aintain an action in
this State.
A liens. Aliens or alien corporations m ay n ot acquire, hold or own
real estate except such as m ay be acquired by inheritance or in the
ordinary course of justice in the collection of debts. Real estate
acquired by an alien creditor a t foreclosure sale m ust be disposed of
within six years. T his prohibition does apply to cases where the
right to hold and dispose of lands is acquired by treaty .
A r b itra tio n . P arties to a controversy m ay subm it the same to
arbitrators, and their award be confirmed by a court and judgm ent
rendered thereon.
A rre st. No person can be arrested under civil process.
A ssig n m e n ts. V oluntary assignments m ust be for the equal
benefit of all the creditors of the assignor and are adm inistered in the
circuit court. No such assignm ent operates as a discharge of the
assignor from his debts.
A tta c h m e n ts . The w rit m ay issue when the debtor is a non-resi­
dent ; or conceals himself so th a t the ordinary process of law cannot
be served; or, has absconded or absented himself from his usual place
of abode in this S tate, .so th a t process cannot be served, or, is about to
remove his property out of the S tate with intent to defraud, hinder, or
delay his creditors; or, is about to rem ove out of the S tate and change
his domicile; or, has fraudulently conveyed, concealed, or removed
his property, or is about to do so, to hinder or delay his creditors; or,
has failed to pay the price of any article which he was bound to pay for
upon its delivery, or has fraudulently contracted tbe debt; or, where
the cause of action accrued out of this S tate and the defendant has
absconded or secretly removed his property into this State; or, where
the damages sued for arise from the commission of a felony or mis­
dem eanor or th e seduction of a female; or, th e defendant is a corpora­
tion whose chief office or place of business is out of this S tate. The
plaintiff, his agent, or attorney m ust m ake affidavit to one or more of
these grounds, and the plaintiff, except where the defendant is a non­
resident, m ust give bond for double th e am ount of the debt.
B a n k s are organized under a general law. The cash capital m ust
not be less th an $10,000 and in cities of 150,000 or more, not less th an
$100,000. The entire capital m ust be subscribed, one-half thereof
paid up on organization, and the other half within one year. D irectors
m ust be residents of this State. T he receipt of deposits w ith knowl­
edge of th e fact th a t th e bank is in failing circumstances, is punishable
by fine or Im prisonment, and officers and agents consenting to the
creation of debts w ith such knowledge, are individually responsible
therefor. N ot more th an 25 per cent of its capital stock m ust be
loaned to any individual or corporation. Large powers of supervision
and control are vested in th e bank commissioner. P rivate bankers
m ust have a paid-up capital of n ot less th an $10,000, and in cities
of 150,000 population or more, n ot less th an $100,000.
Every firm or individual as well as every corporation th a t engages
in the business of banking shall be subject to the strict supervision of
the S tate Banking D epartm ent.
C o n d itio n a l S ales of personal property, unless recorded, are void
as to subsequent purchasers in good faith and creditors.
C o n v ey an ces, A person m ay convey title to lands although not
in possession, an d although the sam e be in adverse possession. ' The
signature of the grantor in a deed need not be attested by a subscrib­
ing witness. A deed by a natural person need not be under his seal.
The corporate seal m ust be affixed to deeds of corporations. The
use of tb e word “ h eirs” in a deed is n ot necessary to create a fee
simple. The sta tu te abolishes estates tail, and converts an estate
tail into a life estate for the first taker, with rem ainder in fee simple
to tbe heirs of his body. The words “ grant, bargain and sell” are
employed in the granting clause of a w arranty deed; by sta tu te those
words constitute express covenants th a t the grantor was seized of an
indefeasible estate in fee simple; th a t th e real estate was free from all
incumbrances done or suffered by him or any person under whom he
claims; and for further assurances of the title to be m ade by him and
bis heirs. Title, subsequently acquired by the grantor in a w arranty
deed, will im m ediately pass to tbe grantee w ithout further convey­
ance. An estate of freehold m ay be m ade to commence in future,
by deed. An interest in real estate, granted or devised to two or
more persons, other th an executors or trustees, or husband and wife,
is a tenancy in common unless expressly declared to be a joint tenancy.
A conveyance to husband and wife creates an estate in entirety, as
a t common law.
C o rp o ra tio n s are formed under general law. In th e case of m anu­
facturing and most other business corporations, th e capital m ust be
not less th an $2,000 nor more th an $50,000,000. One-half m ust be
subscribed and actually paid up in money or property of the full
value thereof, if p a rt of the capital stock is paid in property, there
m ust be an itemized description, the actual cash value of each item
being shown. P a rt of the stock m ay be preferred, paying not to

1764

B A N K IN G A N D C O M M E R C IA L L A W S— M IS S O U R I

exceed 6 per cent annual dividends. C um ulative voting is perm itted.
D irectors m ust n o t be less th a n three nor more th an tw enty-one; three
of th em m ust be citizens and residents of th e S tate. A stockholder
having paid for his stock in full is subject to no further liability. The
bonded indebtedness cannot be increased nor the-capital stock increased
or dim inished except w ith th e consent of persons holding three-fourths
of th e am ount in value of th e stock. T w o-thirds in value of th e stock
m ay apply to th e circuit court for a decree for th e winding up of the
business.
Corporations owing no debts m ay also be dissolved b y unanim ous
vote of all shareholders.
A corporation pays an annual franchise tax equal to one te n th of
one per cent of th e par value of its outstanding capital stock and
surplus.
T he General Assembly of 19X3 enacted w hat is popularly known as a
'"b lu e sky law,” placing under strict supervision of th e B ank Com­
missioner, corporations and partnerships carrying on th e business of
selling an d negotiating stocks, bonds and securities (a few securities
excepted) and in 1923 th e M issouri Securities A ct was passed am pli­
fying th e Blue Sky Law.
Ample powers of visitation and sum m ary action are conferred upon
th e B ank Commissioner, and penalties of fine and im prisonm ent
imposed for violation of th e law.
A foreign corporation m ust file in th e office of th e secretary of sta te
a copy of its charter w ith a statem ent of th e proportion of its capital
stock invested in Missouri, and pay certain fees. I t th en receives a
license to do business in th e S tate. I t m ust also m aintain an office
in th e S tate. I ts personal property in this S tate m ay n ot be incum­
bered to th e injury of any creditor who is a citizen of th is S tate, and
no m ortgage b y a foreign corporation except a railroad or telegraph
com pany, to secure a d eb t created in another S tate is effective as
against an y citizen of this S tate u ntil its debts, due to resident citizens
a t th e tim e of recording th e m ortgage, have been paid. A corporation
failing to com ply w ith these provisions is subject to a fine and cannot
m aintain a su it in a court of this S tate. A corporation of any country
outside of th e U nited States before being authorized to tran sact busi­
ness in th is S tate m ust have a public office in th e S tate, where books
shall be k ept, showing in detail its assets and liabilities, th e names
and residences of its shareholders, officers, directors, and managers.
N one of these requirem ents apply to insurance companies.
C o u rts . C ircuit C ourts have original jurisdiction in all cases of law
an d equity and hold two or more term s in each year in each county.
Jurisdiction of th e settlem ent of estates of deceased persons is vested
in a P ro b ate C ourt .in each county. Justices of th e Peace have juris­
diction up to $250; in counties and cities having over 50,000 and less
th an 200,000 population up to $300; in townships having more th an
200.000 and less th a n 400,000 population, up to $500; in cities of over
300.000 population up to $500; in cities of more th a n 300,000 in some
cases $600. T he S ta te is divided into three districts, over each of
which is a separate C ourt of Appeals, to which appeals lie from th e
C ircuit C ourts w ithin said district, where th e am ount involved does
n o t exceed $7,500 exclusive of costs. W here th e am ount involved
exceeds th is sum, or th e title to real estate or a constitutional cpiestion
is raised, th e Supreme C ourt has exclusive appellate jurisdiction.
D ay s o f G race are abolished. (See N egotiable Instrum ents.)
D e p o sitio n s. M ay be tak en on notice of a t least th ree days and
one d ay additional for every fifty miles of th e first 300 and beyond th a t
one additional d ay for each 100 miles from th e place of serving the
notice. I f taken outside of th e S tate a commission issues from th e
court in which th e suit is pending. T hey m ay be taken within
th e S tate b y an y judge, justice of th e peace, n otary public, clerk of a
court, m ayor or chief officer of a city or tow n having a seal of office;
an d if out of th e S tate by any officer appointed by authority of th e laws
of th is S tate to tak e depositions, a consul or commercial representative
of th e U nited States having a seal, or m ayor of any city or tow n having
a seal, or any judge, justice of th e peace, or other judicial officer, or a
n o tary public. T hey m ay be tak en upon w ritten interrogatories, b u t
th is is n o t custom ary. T he nam es of th e witnesses or of th e officer
need n o t be m entioned in th e notice. Objections to th e com petency
or relevancy of th e testim ony need n ot be noted, b u t can be first m ade
when i t is offered a t th e trial. Objections to th e form of questions
m ust be m ade or th ey are deemed to have been waived.
D e s c e n t a n d D is tr ib u tio n o f P ro p e rty . T he real and personal
estate of an in testate descends and is distributed as follows: 1. To
his children or their descendants in equal parts. 2. I f there be no
children or their descendants, then to his father, m other, brothers, and
sisters, and their descendants in equal parts. 3. I f there be no chil­
dren or th eir descendants, father, m other, b rother or sister, nor their
descendants, th en to th e husband or wife; if there be no husband or
wife, th en to th e grandfather, grandm other, uncles and aunts, and
th eir descendants in equal parts. 4. I f there be no children or their
descendants, father, m other, brother, sister, or their descendants,
husband or wife, grandfather, grandm other, uncles, aunts, or their
descendants, th en to th e great-grandfathers, great-grandm others, and
th eir descendants, in equal p arts, and so on, in other cases w ithout end
passing to th e nearest lineal ancestors and their children, and their
descendants in equal parts. Posthum ous children inherit. W hen
th ere are collaterals of th e half blood, th ey inherit half as m uch as those
of th e whole blood. Lineal descendants in equal degree take per
cap u t; b u t where p a rt of them are dead and p a rt living, th e issue of
those dead tak e per stirpes. W hen a wife shall die w ithout any child
or o th er descendants in being, capable of inheriting, her widower shall
be en titled to one-half th e real and personal estate belonging to the
wife a t th e tim e of her death, absolutely, subject to th e paym ent of
th e wife’s debts, and th e widow takes a like share of the estate of her
husband on his d eath w ithout lineal descendants. An illegitim ate
child inherits from its m other, and vice versa. An illegitim ate child
becomes legitim ate if the parents interm arry.
D o w er. Dower and curtesy in real estate exist as a t common
law, b u t both are greatly modified by sta tu te ; for instance, if either
spouse die w ithout issue, th e survivor is entitled to one-half the_ real
an d personal estate of th e decedent subject to debts. I f th e widow
survives she is entitled to have, in addition, all th e real and personal
estate which came to her husband in rig h t of th e m arriage, and all
th é personal property which came to her husband’s possession w ith
her w ritten consent undisposed of a t bis death, free from his debts.
I f th e husband leave a child or children or other descendants, th e widow
m ay elect to ta k e a ch ild ’s share in lieu of dower.
E x e c u tio n s. Unless m otion for new trial is filed w ithin four days
after judgm ent, execution issues im m ediately. Real estate m ust be
sold diming a session of th e court which rendered th e judgm ent. Sales
o f real estate m ust be advertised for tw enty days; of personal property
for ten days. Execution sales are for cash. No execution is a lien
upon personal property until actual seizure thereof. I t m ay issue at
any tim e w ithin ten years from th e rendition of th e judgm ent. Deeds
to th e purchaser are m ade a t once by th e sheriff, no confirmation of
sale being required.
E x e m p tio n s . The hom estead of th e head of a fam ily is exempt
in th e country to th e ex ten t of 160 acres n ot exceeding in value $1,500,
in cities of 40,000, eighteen square rods, n ot exceeding in value $3,000
in cities of 10,000, th irty square rods n ot exceeding in value $1,500, in
tow ns of less th an 10,000, ten acres, n ot exceeding in value $1,500.
T he exem ption continues to th e widow and to th e children until their
m ajority. T here are also exem pt, when owned by th e head of a family,
te n hogs, ten sheep, two cows, and certain farm im plem ents; tw o work
animals, spinning wheel, loom, and small q u antity of hem p, flax, and
wool; wearing apparel; $100 in household and kitchen furniture;
m echanic’s tools; provisions on hand for fam ily usé; Bibles and other
books usëd in th e fam ily. Lawyers, physicians, m inisters, and
teachers have th e right to select professional books in lieu of other


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

property allowed to them and doctors m ay select medicines. In lieu
of certain of th e exem pted articles any o ther property, not exceeding
$300 in value, m ay be selected. No exemptions are allowed against
taxes, or claims of blacksm iths, house servants, or common laborers
to th e am ount of $90 provided suit is brought within a legal limit.
F ra u d s a n d P e r ju rie s . N o executor o r adm inistrator is bound by
his prom ise to pay any d eb t or dam ages o ut of his own estate, and no
person is liable upon any agreem ent to answer for th e debt, default, or
m iscarriage of another, or m ade in consideration of marriage, or for
th e sale of lands or an y interest in or lease thereof for a longer time
th an one year, or on any agreem ent th a t is n ot to be perform ed within
one year unless th e agreem ent sued on, or a m em orandum thereof is in
writing signed b y th e p a rty to be charged or his authorized agent; and
no contract for th e sale of lands by an agent is valid unless the author­
ity of th e agent is in writing. E v ery gift, conveyance, or assignment
of or charge upon real or personal property m ade w ith in ten t to hinder,
delay, or defraud creditors or defraud or deceive persons who shall puiv
chase th e sam e lands, is void against creditors and purchasers, prior
and subsequent. T he disposition of th e larger p a rt or th e whole of a
stock of m erchandise pertaining to vendor’s business otherwise than
in th e ordinary course of trade, is fraudulent and void as against credi­
tors of th e vendor, unless th e vendee shall, a t least seven days before
th e sale furnish to th e creditors a statem ent of th e consideration for
th e sale, th e am ount of th e indebtedness of th e vendor, and the names
of his creditors. All creations of tru st in lands m ust be in writing
except those resulting b y im plication of law.
G a r n is h m e n t. Garnishees m ay be sum m oned under writs of
attachm ent or execution. A garnishee m ay discharge himself by
delivering up th e property or paying th e d eb t to th e officer under order
of court. C redits or property attached in th e hands of a garnishee
m ay be claimed by a th ird person, who m ay assert his title by inter­
pleader. N o t more th an 10 per cent of th e wages due for the last
th irty days’ service of th e head of a fam ily and resident of this State
can be garnished. Public corporations and th eir officers are exempt
from garnishm ent, as are also adm inistrators and executors prior to
an order of distribution.
H o lid ay s. January 1, F ebruary 22, M ay 30, Ju ly 4, the first
M onday of September, any general prim ary election day, any general
sta te election day, any thanksgiving day appointed by th e President
or Governor, and December 25 are public holidays; and when any of
them fall on Sunday, th e next day is such holiday. February 12,
known as “ Lincoln D ay ,” and October 12, known as “ Columbus D ay”
are also holidays, b u t are n ot such as respects commercial paper.
H u s b a n d a n d W ife. (See M arried Women.)
I n c o m e T ax. A tax of one per centum is levied upon the annual
income of individuals and corporations for th e year 1922 and subse­
quent years, w ith provisions for certain deductions and exemptions.
I n h e r ita n c e T ax . A tax is levied upon th e estates of deceased
persons varying from one to five per cent, depending on the relation
of th e beneficiary to th e deceased, and exceeding those rates when the
value of th e property received b y a. beneficiary exceeds $20,000, with
certain exem ptions in favor of different classes of persons mentioned
in th e law.
I n t e r e s t . Legal ra te 6 per cent, b u t by agreem ent in writing any
ra te n ot exceeding 8 per cent. The legal ra te is collectible on moneys
after th ey become due; on w ritten contracts or accounts, after due
and dem and m ade; on m oney recovered for th e use of another and
retained w ithout th e ownerls knowledge. I f usurious interest has been
paid th a t p a rt in excess of th e legal ra te is deem ed paym ent and credit­
ed on th e debt, th e holder of which recovers th e d eb t only with legal
interest after deducting such paym ents, and costs are adjudged
against him . T he receipt o r exaction of usurious in terest upon a debt
secured b y lien upon personal property renders th e lien invalid. Part­
ies m ay contract th a t interest m ay be com pounded, b u t not oftener
th an once in a year.
J u d g m e n ts . Judgm ents and decrees rendered b y a court of record
are liens on th e real estate of th e person against whom th ey are rend­
ered situate in the county for which th e court is. held. Transcript of
a judgm ent filed in th e office of th e clerk of th e circuit court of any
other county becomes a lien upon real estate in such county. The
lien of a judgm ent continues for three years, and m ay be revived at an
tim e within ten years from its rendition. Execution m ay issue at
any tim e within te n years from th e rendition of a judgm ent. When
tw o or more judgm ents are rendered a t th e same term as between
parties entitled to th e judgm ents, th e liens commence on the last day
of the term a t which th ey are rendered. Judgm ents bear interest at
6 per cent, b u t if upon contracts bearing more th an 6 per cent, the
judgm ent b ears th e ra te of th e contract.
l i e n s . S tatu to ry provisions exist for mechanics’ liens, liens of
keeping horses and o ther animals, liens of inn and boarding-house
keepers, liens of contractors, m aterial-m en, and laborers against
railroads.
l i m i t a t i o n s . Actions m ust be commenced within ten years:
1. U pon any writing for th e paym ent of money or property, 2.
On any covenants of w arranty or seizin contained in any deed. 3.
F or recovery of lands. 4. F or relief not otherwise provided for.
W ithin five years: 1. U pon contracts, express or implied, except
judgm ents or decrees of court. 2. Upon a sta tu to ry liability other
th a n a penalty or forfeiture. 3. Trespass. 4. Replevin, and for
an y other injury to th e person or rights of another not arising on con­
tra c t and not otherwise enum erated. 5. F or relief on the ground or
fraud. W ithin three years. 1. Against public officers for acts or
official commission or omission. 2. F or a p enalty or forfeiture where
th e action is given to a p arty or a p a rty and th e State. W ithin two
years: Actions for libel, slander, assault, b attery , false imprisonment,
or crim inal conversation. S tatu te does n ot begin to run against a
resident of this S tate who is absent a t th e tim e it accrues, until ms
return; if he depart after it accrues, th e period of his absence is not
counted. Acknowledgments or promises, to tak e a case from tne
operation of th e sta tu te, m ust be in writing. Judgm ents are pre­
sumed’ to be paid after ten years. A cause o f action barred by tne
laws of th e S tate in which it originated is barred in this State.
L im ite d P a r tn e r s h ip . M a y consist of one or more general and
one or m ore special partners. Special partn ers contributing a spec,1"
fled am ount in cash to th e capital are n ot personally liable for the deD ts
of th e partnership and have no power to transact its business, a
verified statem ent of th e term s of th e partnership m ust be filed vutn
th e recorder of th e county and published. T here can be no limited
partnership for th e business of insurance or banking.
M a rrie d W o m e n . A m arried woman is deemed a femme sols
far as to enable her to carry on or transact business on her own account,
to contract and be contracted w ith, to sue and be sued, to enforcei or
have enforced against her property such judgm ents as m ay be remereu
for or against her, and m ay sue or be sued a t law or in equity, wnn o
w ithout her husband being joined as a party. H er real estate ana
personal property cannot be taken by any process of law for tne aeows
Of her husband. N either th e rents, issues, or products of hevreai
estate, nor th e interest of h er husband in her right in any real esta ,
can be levied on for his debts, except for necessaries o f the ianmi
and for im provem ents m ade upon it.
M o rtg a g e s . M ortgages on real estate are executed _^ ‘e deeds.
H usband and wife m ust join to bar dower or homestead, excep .,
secure purchase m oney. T he common form of real estate sewn j
is a deed of tru st w ith power of sale in the trustee upon „„ itHiritv
th e paym ent of the debt. Sale is a t public auction¡upon tw
or more days’ public notice, as m ay be provided in the m ^ ru eu
T he trustee executes deed-to th e purchaser, T here is no reaemp
from sale unless th e holder of th e debt is th e purchaser, in wnic
the debtor m ay redeem within one year if he gives w ritten not
the sale or within th e preceding ten days of his purpose, ana w

B A N K IN G A N D C O M M E R C IA L L A W S— M O N T A N A
twenty days after sale give security for paym ent of interest to accrue
within th e year and all interest on prior incum brances paid b y th e
creditor and taxes and assessments accruing during th e year. E vi­
dences of d eb t secured b y m ortgage or deed o f tru s t m ust be produced
to the recorder when satisfaction is entered. N o foreign corporation
or individual m ay act as trustee in any deed of tru st unless th ere be
named as co-trustee a M issouri corporation or individual citizen of
this state, an d th e resident trustee m ust be a p a rty plaintiff in an
action to foreclose.
,
Chattel m ortgages are invalid except as between th e parties unless
possession of th e property be tak en and retained by th e m ortgagee
or the m ortgage be acknowledged and recorded in th e county of th e
mortgagor in th e sam e m anner as conveyances of real estate, or unless
the mortgage or a copy thereof be filed on th e office of the recorder of
the county of th e m ortgagor, or, where he is a non-resident of th e
State, th en in th e office o f th e recorder of th e county in which th e
property is situated. E v ery such m ortgage ceases to be valid after
the expiration of five years from th e filing of th e same.
N egotiable I n s t r u m e n t s . T he General Assembly of this S tate
has codified th e law of negotiable instrum ents by th e passage of "A n
act relating to th e negotiable instrum ents, to revise and codify th e
law concerning th e same, and to establish a law uniform w ith th a t
of other states on th e subject.” T he act is th e sam e as th a t adopted
by many other states in accordance w ith th e recom m endation of th e
American B ar Association. I t becam e effective in M issouri, Ju n e 16,
1905.
P ro b a te L aw . (See A dm inistration of E states.)
P ro te st. (See Negotiable Instrum ents.)
R eplevin. Goods or chattels wrongfully tak en or retained m ay be
replevied by th e owner or p a rty entitled to possession. Affidavit
must be filed an d bond in double th e value of th e property given. In
certain cases defendant m ay retain possession of the property by giving
a bond in double its value. I f plaintiff fail in his suit, defendant
recovers judgm ent against plaintiff and th e sureties on th e bond for
the value of th e p roperty and damages.
Taxes. S tate and county taxes are usually paid in N ovem ber
or December. If n o t paid, th ey are regarded as delinquent from the
first day of th e succeeding January. If n ot paid before th e last day
of December a penalty of one per cent per m onth is added as interest
until paid. S tate and county taxes for each year are a lien upon
the real e tate from th e first day of June of th e preceding year. Delin­
quent sta te an d county taxes are collected by suit. M unicipal taxes
are payable according to th e provisions of th e charters or general
laws by which th ey m ay be governed. In some cases th e paym ent
of delinquent city taxes m ay be enforced b y a sale of th e property
without suit; in others, su it m ust be brought before sale can be m ade.
There is no redem ption from a sale under a judgm ent for sta te and
county taxes. Redem ption is usually allowed in a sale for city taxes
under th e provisions of th e particular charter.
Wages. (See G arnishm ents; Exem ptions.)
Wills. E v ery m ale person tw enty-one years of age m ay, by his last
will, devise all of his estate, real, personal, and mixed, and every m ale
over the age of eighteen years m ay bequeath his personal estate.
Women of eighteen years of age and upward, m arried or unm arried,
may devise th eir real estate an d bequeath th eir personal property. A
will must be in writing, signed by th e testa to r or some person by his
direction in his presence, and m ust be atteste d by tw o or more com­
petent witnesses subscribing their nam es to th e will in th e presence of
the testator. I f after m aking th e will th e testa to r shall m arry and die
leaving issue of th e m arriage living a t th e tim e of his death, or bom to
him after his death , th e will shall be deem ed revoked. T he will of an
unmarried woman is revoked by her subsequent m arriage. I f a child
or children, o r th e descendants of such child of children, in case or
their death, are n o t nam ed or provided for in th e will, th e testa to r is
deemed to have died in testate as to such child or children or th eir
descendants. Wills m ust be presented for probate to th e probate
court of th e county in which was th e place of abode of th e testator.
Wills m ay be contested w ithin tw o years after the probate thereof by
petition to th e circuit court of th e county. Real estate in this S tate
may be devised by last will executed and proved according to th e laws
of this State. Personal estate m ay be bequeathed according to th e
laws of th e sta te or country in which the will shall be m ade.

S Y N O P S IS OP

THE LAWS OF MONTANA
RELA TIN G TO
B A N K IN G A N D C O M M E R C IA L U S A G E S
Revised by C h a r l e s E . P e w , A ttorney a t Law, Helena.
A b stracto rs. M ust give $5,000 bond to sta te and shall receive
certificate from S tate T reasurer authorizing him to do business.
Abstract furnished by authorized abstracter adm itted in court has
prima facie evidence of contents.
A ck n o w led g m en ts o f instrum ents m ay be taken in th is S tate.
1. Before suprem e court justice, district judge, justice of th e peace,
clerk of any court of record, county clerk, notary public, or U. S. Com­
missioner. 2. Outside M ontana in th e U nited States. Before th e
justice, judge or clerk of any court of record of th e U nited States or
any state or territo ry ; a commissioner appointed by th e governor for
that purpose, a notary public, or any o th er officer authorized to take
acknowledgments. 3. Outside U nited States before m inister, com­
missioner or charge d ’affairs, consul, vice-consul or consular agent of
the United States, a judge of court of record, commissioner appointed
by governor or notary public. In all cases acknowledgment, m ust be
taken within jurisdiction of officer taking.
Must be in substantially following form : " S ta te o f .......................
county of ................... s. s. On t h i s ................day of . . . . 19. .before
(name of quality of officer) personally appeared ................... known
to me (or proved on oath of . . . . . . to be th e person whose nam e is
subscribed to th e within instrum ent, and acknowledged to m e th a t
he (or they) executed th e sam e.” Same for m arried women. In
case of corporation sam e to star, th en “ president or vice-president
(or secretary or assistant secretary) of th e corporation th a t executed
the within instrum ent an d acknowledged to m e th a t such corporation
executed the same,” and in case of attorney in fact, “ whose nam e is
subscribed to th e w ithin instrum ent as atto rn ey in fact of ...................
and acknowledged to me th a t he subscribed th e nam e of ................. ..
thereto as principal, and his own nam e as attorney-in-fact.” Outside
the county m ust be accompanied by certificate of county clerk.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1765

A d m in is tr a tio n o f E s ta te is h ad in district courts. N otice to
creditors published four weeks. Claims n ot presented in four m onths
after first notice, if estate $10,000 or less, or ten m onths if over $10,000,
are barred.
L etters of adm inistration granted to : 1. Surviving husband or
wife or com petent appointee. 2. Child. 3. F ath er or m other. 4.
Brother. 5. Sister. 6. Grandchild. 7. N ext of kin who inherits.
8. Public adm inistrator. 9. Creditor. 10. Any person legally com­
petent. W hen several claim rig h t and equally entitled, court appoints,
preferring males to females and whole blood to half blood.
A ffidavits m ay be taken or oaths adm inistered before any judicial
officer, clerk of any court, county clerk or n otary public in this State;
in any other sta te before a commissioner appointed by th e governor,
notary public, or judge or clerk of any court of record having a seal;
in a foreign country before an am bassador, m inister, consul, viceconsul, or consular agent of th e U nited States, or judge of a court of
record having a seal.
W hen taken before a judge in any o ther sta te or foreign country,
th e existence of th e court, signature and official character of th e judge
m ust be certified by th e clerk of such court, under its seal.
A lien s a n d D e n iz e n s have sam e rig h t as citizens to acquire, use
and dispose of mining property and real estate in connection th ere­
with.
A r b itra tio n . Any controversy except over title to real property
m ay be subm itted to arbitration by a w ritten agreem ent to th a t effect
filed in court and m ay be m ade an order of court. W hen m ade an
order of court is irrevocable; otherwise it is revocable a t any tim e
before award. An agreem ent to arb itrate cannot be specifically
enforced.
A rre s t. D efendant in a civil action m ay be arrested when abo u t
to leave th e S tate or conceal his property, w ith in ten t to defraud
creditors, and in certain other action where fraud, wilful injury, or
wilful violation of duty, or wrongful conversion of m oney or property
by a public officer or a fiduciary, or for fine or penalty.
A s sig n m e n ts. V oluntary assignm ents for benefit or creditors
allowed if without) conditional preference, n ot coercive, im partial,
w ithout reservation for fraudulent benefit of assignor, and does not
confer power upon assignee to delay execution of th e tru st, nor exem pt
him from liability for negligence or m isconduct. Is under partial
supervision of th e district court.
A tta c h m e n ts . W rit of m ay be had a t th e tim e of issuing sum ­
mons or any tim e thereafter in actions upon unsecured contracts
express or implied for direct paym ent of money, or if contracts origi­
nally secured, when security has become worthless w ithout plain­
tiff’s fault. Is Issued upon affidavit on behalf of plaintiff, after filing
bond in double am ount of claim, if under $1,000; if over, in am ount
of claim : bond never to exceed $10,000. A ny property, real or per­
sonal, or d eb t due from or money or personal p roperty held by th ird
person, including judgm ents, m ay be attached. M ay be issued upon
debt n ot due if debtor leaving sta te or disposing of property to defraud
creditors.
B a n k s a n d T r u s t C o m p a n ie s . N o te : M o n t a n a h a s a n e la b o ­
r a te b a n k in g co d e . T h e fo llo w in g s y n o p s i s g iv e s a n id e a o f th e c h a r a c te r
o f th is le g is la tio n , b u t th e la w i t s e l f s h o u ld b e r e f e r r e d to b e fo re a c tin g i n
a n y m a t te r c o m in g w i t h i n i t s p r o v is io n s :

“ B ank" includes Commercial Banks. Savings Banks, T ru st Com­
panies, and Investm ent Companies.
T hree or m ore persons m ay organize under supervision of Super­
intendent of Banks, whose refusal to issue certificate shall be con­
clusive.
Commercial B ank shall have a t least $20,000 capital fully paid
and deposited in M ontana banks. O ther banks shall have a t least
$100,000 capital and n ot over $10,000,000, a t least $100,000 sub­
scribed and fully paid and deposîtëd in M ontana banks.
P ar value of shares $100. and no preferred stock.
D irector m ust own a t least $1,000 par value of unincum bered stock.
Stockholders individually liable to extent of par value of stock in
addition to am ount invested in such stock. Executor, adm inistrator,
guardian or trustee n ot personally liable b u t property of beneficiary
is liable.
Delivery of certificate to bona fide purchaser for value w ith w ritten
transfer or w ritten power to sell, assign and transfer the sam e passes
title as against subsequent purchaser, or encum brancer, b u t dividends
m ay be paid to record owner u ntil transfer recorded in books of
corporation.
A t least one-half of am ount paid in capital of Savings Bank and
one-half of deposits m ust be invested in bonds and sim ilar specified
securities, no loan greater th a n $10,000.
M ay hold property necessary in its business or acquired in good
faith through foreclosure of securities or collection of debts.
T ru st and Investm ent Companies given broader power in invest­
m ents th a n Commercial and Savings Banks.
M ay join N ational Reserve.
N o person, firm or corporation, dom estic or foreign, n ot having
certificate of superintendent of th e banks authorizing to do business,
m ay advertise banking business.
Foreign corporation n ot engaged in banking business m ay lend
money in sta te , if it has complied w ith laws pertaining to foreign
.corporations.
D irectors m ay declare and pay dividends to stockholders o u t of
profits, b u t m ust carry a t least one-fifth n et profits to surplus u n til
th é surplus am ount to 2o per cent of paid up capital.
B ank m ay invest nor m ore th a n one-tenth of capital and surplus
in safe deposit departm ent.
B ank shall n ot invest capital, surplus, or deposits, in or loan money
upon its stock except to prevent loss.
Shall n ot sell securities to officers or employees. Shall not under­
w rite bond issue except U nited States, S tate and M unicipal bonds of
M ontana, in excess of 10 per cent of its assets.
M ay n o t acquire stock of any corporation unless necessary to pro­
te c t previous debt.
Commercial bank shall n ot loan on real estate except on first lien
n ot exceeding 50 per cent m arket value of property and n ot more
th a n 35 per cent of assets shall be so loaned; b u t this does not lim it
right to take any security for previous debt.
Deposits by two persons payable to either or survivor m ay be
paid to either even after death of th e other.
E very bank, except reserve bank, shall keep reserve of 10 per cent
of deposit liabilities, and reserve b ank shall keep 15 per cent. Solvent
bank w ith capital and surplus $100,000 m ay be desginated by Super­
intendent of Banks as Reserve Agent for M ontana S tate Banks.
No bank shall become indebted in excess of paid up capital and
surplus w ithout w ritten authority from Superintendent of Banks.
S tate B ank m ay change to N ational B ank and v ic e v e r s a . _
N ot liable for forged or raised check unless notified thereof m one
year after retu rn of check to depositor.
Liable only for actual dam age for non-paym ent of check through
m istake w ithout malice.
.
,
Office of Superintendent of Banks created, who perform s duties
form erly imposed on S tate Auditor.
C o n tr a c ts . C ontracts of conditional sale retaining title in vendor
m ust be filed with county clerk or are void as to bona fide purchasers,
m ortgages or attaching creditors prior to filing.^ In case of default
vendor m ay recover property in claim and delivery proceedings or
foreclose as in case of ch attel m ortgage.
C o n v ey an ces. T itle to property of any kind (except a m ere pos­
sibility n o t coupled w ith an Interest), including a right of re-entry for
breach of condition subsequent, and property in th e adverse possession
of another, m ay be transferred. D eed to several persons, except to
executors and trustees, creates tenancy in common, unless expressly
declared a joint tenancy in the deed. T he fee simple title passes by

1766

B A N K IN G A N D C O M M E R C IA L L A W S— M O N T A N A

a grant, unless expressly lim ited to a less title in th e deed. Cove­
nants th a t th e grantor has m ade no previous deed to any other per­
son, and th a t the premises are free from encum brance by the grantor
or an y one claiming under him are implied from use of word “ g ran t.”
A m arried woman joining w ith her husband in any instrum ents
affecting real property is bound thereby the sam e as though single
if duly acknowledged by her. Instrum ents affecting real property
m ay, if acknowledged, be recorded, and such record im parts notice
to th e world. (See Acknowledgments .)
C o rp o ra tio n s are found under th e general sta tu te, except bank­
ing, insurance and railroad corporations, and corporations n ot for
profit, which are governed by special laws. Stockholders have one
vote for each share, m ay vote in person or by proxy, and m ay cum u­
late votes in director elections. Articles of incorporations filed in
county where principal office located, and copy filed w ith secretary of
S tate, may hold only necessary real estate; from three to thirteen
directors, wno m ay be empowered to m ake by-laws; m ay classify
directors; control business; stock issued for m oney or property; stock
liability lim ited to unpaid portion, directors assenting to creation of
debts beyond subscribed capital stock or m aking dividends o ut of
capital stock are jointly and severally liable therefor; stockholder m ay
examine books; w ritten transfer or power of attorney to sell, and
delivery of certificate passes title, between parties and against credi­
tors; m ay be attached on books of corporation. E very domestic
corporation having a capital stock m ust file report in county clerk’s
office, w ithin tw enty days after December 31st of each year, showing
am ount of capital stock, am ount paid in cash, and am ount paid in
property, am ount of existing debts, and nam es and addresses of
directors, president, vice-president, general m anager and secretary;
directors neglecting to file are jointly and severally liable for debts
existing during failure to file, director m ay exonerate himself by filing
within ten days after default affidavit showing th a t during the tw enty
days h e asked president or sufficient directors to file, and th a t default
is n o t due to his neglect. Subject to S tate tax of one per cent on net
income over $2,500.
Foreign corporations, except insurance companies and corporations
otherwise provided for, m ay do business after filing w ith secretary
of sta te and in county where intend to do business, copy of charter
and verified statem ent of president and secretary, showing name,
capital stock, am ount paid in m oney or property, assets and of w hat
consist, and th eir actual cash value, and am ount of liabilities; also a
consent to be sued and appointm ent of agent for service of process
and acceptance ot same. Secretary of S tate now collects fees upon
proportion o f capital employed in M ontana. If capital increased or
dim inished m ust file certificate thereof w ith secretary of sta te and
county clerk and refusal to do so forfeits right to do business in State.
M u st w ithin two m onths after April 1st, file report like verified state­
m ent ju st mentioned, in county clerk’s office, and copy w ith secretary
of state. C an have no greater rights or privileges th an domestic
corporations.
Foreign Corporations doing business in this S tate are m ade sub­
ject to th e jurisdiction of th e courts of this S tate th e sam e as dom estic
corporations and their stock is m ade attachable in this State. M ay
be served, if no officer, agent or other representative can be found
in M ontana, by leaving process w ith Secretary of State.
Foreign incorporations subject to S tate tax of one per cent on net
Income over $2.500 on business done in M ontana.
C o u rts . D istrict courts have original jurisdiction in law and
equity where over $50 involved; have probate and crim inal juris­
diction. C ity police courts of p e tty crim inal jurisdiction. Justices
of peace lim ited to $300, p e tty crim inal cases; cannot try title to land,
nor questions of constitutionality. Appeals lie from justice to dis­
trict and from district to suprem e court. Supreme court appellate
court of last resort, except has original jurisdiction in applications for
habeas corpus and sim ilar writs.
D ays o f G ra c e . None.
D e p o sitio n s of resident m ay be taken when witness is a p arty in
Interest, or resides out of th e county, or is about to leave and will
probably continue absent, or is too infirm to a tten d ; or th e testim ony
& to be used on a motion, or when witness is only one who can estab­
lish a m aterial fact and his presence cannot be procurea a t th e trial.
Exam inations m ay be upon oral questions or by agreem ent upon
w ritten interrogatories. In case of non-resident within United States,
judge m ay issue commission upon five days’ notice, if parties donot
agree upon person, to any judge, or justice or commissioner. I f out
of United States, m ay be directed to a m inister, am bassador, consul,
vice-consul or consular agent of th e U nited S tates in such country,
or to such person as m ay be agreed upon. Exam ination of non­
residents Unless otherwise agreed, m ust be by w ritten interrogatories.
D e sc e n t. Intestates’ real and personal property, subject to pay­
m ent of debts, descends as follows: If widow or surviving husband
an d one child, half to each; if widow or surviving husband, and more
th an one child or one child and lawful issue of one or more deceased
child, one-third to husband or wife and tw o-thirds to such children
and issue per stirpes; if no child living, tw o-thirds to lineal descend­
ants, equally if of sam e degree, if not, per stirpes; if issue and no hus­
band or wife, whose estate to issue if such issue consists of more than
one child living and lawful issue of deceased child or children, then
in equal shares to living children and issue of deceased children per
stirpes; if no issue, one-half to husband or wife and one-half to father
and m other in equal shares, or if either be dead, th e whole half goes
to th e survivor. If no father or m other one-half in equal shares to
brothers and sisters or th eir children per stirpes. If no issue nor
husband or wife, entire estate, to fath er and m other equally, or to
survivor. I f no issue father, m other, husband, nor wife, in equal
shares to brothers and sisters and to children of any deceased brother
or sister per stirpes. If surviving husband or wife, and neither issue
father, m other, brother, nor sister, entire estate to husband or wife;
if none of above m entioned, to next of kin in equal degree, claiming
through nearest ancestor; if leaves more than one child, or one and
th e issue of one or more deceased children, and any such child die
unm arried under age, his share goes to children of sam e parent or
their issue per stirpes. If no husband, wife or kindred, the property
escheats, to S tate. Illegitim ate child is heir of person who acknowl­
edges himself, in writing before a com petent witness, to be its father
and is an heir of his m other; if parents interm arry, is legitimatized.
D ow er. C urtesy abolished. Wife endowed of th ird of lands
owned by husband during m arriage. E quitable estates and contracts
included. No dower in lands m ortgaged for purchase price as against
mortgagee, not in lands conveyed to him by way of m ortgage unless
be acquire absolute title during lifetime, Devise or bequest bars
widow’s dower unless otherwise expressed in will, b u t she m ay elect
between devise or bequest and dower, within one year in writing.
I f husband die leaving no children nor descendants of children, widow
m ay have, absolutely, one-half of all his estate after paym ent of
debts, -if she elect w ithin two m onths after paym ent of debts. A
woman m ay be barred of dower by jointure w ith her assent before
m arriage, consisting of freehold in lands of life, a t least, beginning a t
d eath of husband. Dower is n ot affected by wife’s deed.
E x e c u tio n unless stayed by order of court, m ay issue a t once upon
rendition of judgm ent; becomes lien oh personalty, upon seizure by
officer holding writ. All property sold to highest bidder. D efendant
or creditor m ay redeem from sale of real estate w ithin year, or sixty
days after previous redem ption.
E x e m p tio n s . To head of fam ily, hom estead to value of $2,500,
and descends as such to surviving wife or husband and children.
H ead of fam ily allowed wearing apparel, chairs, tables, books, a t
$200, all necessary household goods’ and certain dom estic anim als and
provisions for three m onths; forty-five days earnings exem pt where
necessary for support of family, except one-half such earnings m ay
be tak en for debts for necessaries. Generally, tools and implem ents
of trad e, libraries, etc., of professional m en who are heads of families,
are exempt.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

F r a u d . I t is criminal fraud to a ttem p t to obtain insurance money
wrongfully; or fraudulently destroy insured property; to issue, sell
transfer or pledge any false, fraudulent or sim ulated stock certificate
or evidence of shares of any corporation, or any officer to sign any
such certificate; unauthorized use of another’s nam e in selling stock;
for a director, officer, or agent of corporation to publish false report
of its affairs; to falsely represent one’s self as com petent to sefi or
m ortgage real estate when signature of husband or wife is necessary;
to get m oney or property by false representations as to wealth or
m ercantile character; to sell any land after having once sold or
agreed in writing to sell th e sam e to another; to convey any real or
personal property w ith intent to defraud •and deceive others or to
hinder or delay creditors; to wilfully certify any false acknowledgment
w ith intent to defraud; to issue any false warehouse receipts or to
wrongfully rem ove or dispose of any property for which a warehouse
receipt has been issued, for th e m ortgagor to dispose in any manner
of any property covered by chattel mortgage. Any negotiable instru­
m ent procured by fraud or circum vention to be executed is void even
in hands of innocent holder.
F ra u d s , S t a t u t e of. Agreement of executor or adm inistrator to
answer for obligation of decedent out of his own estate; agreement
n ot to be perform ed in one year; promise to answer for obligation of
another, unless it is m ade an original obligation of promissory; an
agreem ent upon consideration of m arriage, except m utual promise to
m arry: for sale of personalty a t a price of. over $200, unless part of
price paid or p a rt of goods accepted, except a t auction sale when
auctioneer en ter sale in sale book; lease for over one year; for sale of
realty, or authorizing broker or agent to sell land for compensation;
is void unless in writing signed by p a rty to be charged or his agent
duly authorized (in writing in case of agreem ents affecting real estate).
E very transfer of property or charge thereon m ade, every obligation
incurred, every judicial proceeding taken, and every act performed,
w ith in ten t to delay or defraud any creditor, or other person, of hia
dem ands, is void against all creditors of th e debtor and* their represen­
tativ es or successors in interest, and against an y person upon whom
th e estate of th e debtor devolves in tru st for th e benefit of others than
debtor. All declarations of tru st in lands shall be in writing, except
resulting tru sts or tru sts created by im plication or operation of law.
H o lid ay s. W henever an act of a secular n atu re is appointed by
law or contract to be perform ed upon a particular day. which day
falls upon a holiday, such act m ay be perform ed upon th e next busi­
ness day. Such holidays are; E very Sunday, th e first day of Jan­
uary. th e 12th day ot February, 22nd day of February, 30th day of
M ay, 4 th day of July, first M onday in September, 12th d ay of October,
Thanksgiving D ay, th e 25th day of December, and every day of a
general S tate election.
H u s b a n d a n d w ife. H usband m ust support wife if able; if not,
she m ust assist; husband has no curtesy; wife has dower; neither
can be excluded from others dwelling; m ay contract w ith each other,
or any other persons, th e sam e as though unm arried; cannot alter
legal relation by contract, except m ay agree to im m ediate separation,
m utual consent being sufficient consideration; m ay hold property
jointly or in common; wife m ay sue and defend alone; all property of
wife is her separate property, and she can convey, or execute power of
attorney thereon w ithout husband's consent. H er deed must be
acknowledged. Filing inventory of her personal property exempts
sam e from claims against husband, except for necessaries for herself
and her children. Wife m ust support husband out of her property
if he is infirm. Wife m ay dispose of her property by will, except that
such will m ust not, w ithout his w ritten consent, deprive husband of
over tw o-thirds of her real estate or tw o-thirds of her personal property;
wife m ay m ake contract, etc., th e same as though single. If husband
neglect to support his wife, bills for necessaries sold h er can be collected
from him, b u t not when separated by consent, unless support stipu­
lated in such agreement.
I n te r e s t. E ight per cent on judgm ents and damages. In other
cases 8 per cent in absence of agreem ent. M ay contract for not more
th an 10 per cent per annum .
J u d g m e n t of courts of record (including federal courts of Montana
if transcript of such judgm ent if filed in district court) are lien on
realty in county for six years; realty in another county becomes sub­
ject to lien upon filing of transfcript of judgm ent in such county.
A bstract of justice court judgm ent becomes lien on realty in any
county where filed in district court.
E le n s. M echanics and m aterial men have lien upon structure or
property upon which labor perform ed or for which m aterial furnished.
M ust file notice and affidavit in C ounty C lerk’s office within ninety
days after last work perform ed, or m aterial furnished. Foreclosure
m ust be w ithin one year after filing. A tto rn ey ’s fees allowed success­
ful plaintiff or defendant in foreclosure suit.
,
In insolvency proceedings employees have lien for sixty days
services n ot exceeding $200. A ttorney’s fees allowed successful party
as above.
.
H otel, boarding and lodging-house keepers have lien upon baggage
and upon other valuable property of guests brought into hostelry.
Such lien foreclosed by four weeks’ publication and sale.
Agisters Uen and lien for service in im provem ent of personal prop­
erty allowed. Seed grain lien allowed, not exceeding 700 bushels.
Prior to all other liens. Verified statem ent of lien m ust be filed with
the C ounty Clerk and Recorder. Thresher m en allowed lien on grain
threshed; second only to seed lien. Verified claim m ust be filed as
in case of seed lien.
Loggers have lien on logs. Lien m ust be verified and recorded.
L im ita tio n of A ctio n s. W ithin 10 years. (1) Action by State
for or in respect to real property or th e issues and profits thereoi.
No person claiming under p a te n t or grant from S tate m ay sue unless
S tate could have sued had p aten t or g rant not issued. (2 )^ Action
for recovery of real property or possession thereof. (3) Action tor
recovery of dower. Tim e runs from d eath of husband. (4) Action
arising out of title to real property or rents or profits thereoi. (&)
Action upon judgm ent or decree of C ourt of Record. (6) Action ror
m esne profits of real property. (7) Action to redeem where mortgage
in possession.
, ,lit„
W ithin 8 years. (1) Action upon contract, obligation or iiaDimy
in writing.
„—.¡on
W ithin 5 years. (1) Action upon contract, account or promise
not in writing. (2) Action to establish lost, concealed, or destroyed
will. Tim e runs from discovery of facts upon which validity depends.
(3) Action upon judgm ent or decree of C ourt n o t of record.
Actions-not otherwise provided for.
W ithin 3 years. (1) Action against sheriff, coroner, or constant
for official actions or omissions n ot including action for escape.
Action for dam ages for wrongful death, t.3) A ction on obligation o
liability n ot in writing, other th an a contract, account or promise.
(4) Action upon forged or altered check paid by bank.
„
W ithin 2 years. (1) Action upon sta tu te for p e n a lty or tor iu
feiture by individual or individual and th e State, except where statu
otherwise provides. (2) Action upon sta tu te or undertaking _
crim inal action for forfeiture or penalty to th e State. (3) actiou
libel, slander, assault, b attery , false im prisonm ent or seuucw •
(4) Action upon sta tu to ry liability other th an penalty or lorieiiui •
(5) Action for injury to or w aste or trespass upon real property,
case of underground work on mining claims, tim e runs from disco j
of facts. (6) Action for taking, detaining or injuring goods or c
tels, and recovery of personal property. (7; A c tio n for rrauu
m istake. Tim e runs from discovery of facts. (8) Action J ? r mum»
or injuring stock by railroad. (9) Action to annual tax deea. _
W ithin 1 year. (1) Action against sheriff or other omcer >
escape. (2) Action against m unicipality for damages or mjuri
mob or riot, or for violation of ordinance. (3) Action against o
account seizure of property as tax collector. (4) Action ior
closure of m echanic's lien.

B A N K IN G A N D C O M M E R C IA L L A W S— N E B R A S K A
Within 6 m onths. (1) Action to recover stock sold for delinquent
assessment. (2) Action against C ounty upon claims rejected by
county commissioners. (3) Action against C ity by policeman, for
salary.
vfithin 60 days. (1) Action for restoration to office. Suit to
recover salary within fifteen days after restoration. (2) Action to
restrain th e issuance and sale of municipal, county 6r school district
bonds or for restraining levy and collection of taxes on account of
defect, irregularity or inform ality in notice or holding election on
bond issue. In no case does s ta tu te ru n during absence of defendant
from State.
L o an s. Farm ers loan departm ent established.
M a rrie d W o m e n . (See H usband and Wife.)
M o rtg ag es of real estate are executed sam e as deeds. H usband
and wife m ust join to b ar dower or hom estead, except purchase m oney
mortgages. Non-judicial sale under power valid. Lien good for
eight years after m atu rity of debt, and m ay be renewed by affidavit
for eight years m ore.
.
C hattel m ortgage m ust be acknowledged by m ortgagor and accom­
panied by affidavit of m ortgagee th a t sam e is m ade'in good faith and
not to hinder, delay or defraud creditors, and by receipt from m ort­
gagor showing receipt b y him of copy a t tim e of execution. Valid
as against creditors or subsequent purchaser or incum brancer from
time of filing w ith Clerk and Recorder in C ounty where properly
situated. Lien continues tw o years and sixty days if n ot renewed.
May be renewed within sixty days after tw o years by affidavit stating
amount due, alleging good faith, etc. Renewal extends tim e for three
years from d a te of fifing renewal.
C hattel m ortgaged p roperty m ay be attached after first depositing
with C ounty T reasurer am ount due mortgagee. Crowing Crops next
maturing m ay bp m ortgaged. If m ortgage so provides m ay be
foreclosed by sheriff.
N eg o tiab le I n s t r u m e n t s . M u st be payable in m oney and m ust
contain an unconditional promise to pay a sum certain on dem and or
at a fixed or determ inable future tim e; m ust be payable to order or
to bearer; m ay be in installm ents and contain provision th a t on any
default th e whole shall become due; with exchange fixed or current
rate, interest and atto rn ey’s fees for collection m ay authorize sale
of collaterals and confession of judgm ent; if it reads “ I promise to
pay” all signers are jointly and severally liable; m ay be payable a t
fixed tim e after date or sight, or after specified certain event, b ut not
upon a contingency; need not specify value given nor place where
drawn or payable; if issued, accepted, or endorsed when overdue it is
payable on dem and; m ay be payable to two or more payees jointly,
or one or more of several payees; absence or failure of consideration a
defense against one n ot a holder in due course and partial failure a
defense pro tan to . One not a p arty to instrum ent placing a signature
in blank before delivery becomes an endorser. Every endorser
engages th a t on due presentm ent it shall be honored or th a t he will
pay the am ount to holder or any subsequent endorser who m ay be
compelled to pay; no days of grace; when m atu rity falls on Sunday
or holiday paym ent is due on next business day; if due on Saturday
must be presented on next business day, b u t if payable on dem and
holder m ay present sam e before noon on Saturday. F raud and cir­
cumvention in procuring execution of instrum ent is a defense against
any holder.
Presentm ent. I t is not necessary to charge one prim arily liable if
payable a t special place; ability and willingness to pay it there a t
maturity is equivalent to a tender, if not on dem and it m ust be pre­
sented on day it falls due. if on dem and then w ithin a reasonable tim e
after its issue, except a bill of exchange m ust be presented within
reasonable tim e after its last negotiation.
Alterations. F raudulent or m aterial, do not affect original instru­
ment in hands of innocent holder in due course.
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. T he holder m ay decline a qualified acceptance and
treat the bill as dishonored; if he takes qualified acceptance drawer
and endorsers are discharged, unless they consent thereto.
Protest .of foreign bills m ay be m ade by notary public or by any
respectable resident of th e place in presence of two or more credible
witnesses; bill of exchange does n ot operate to assign funds in hands
of drawee and be is n ot liable unless be accepts.
Promissory N ote. M ust be unconditional promise in writing to
pay on dem and or a t fixed or determ inable tim e a sum certain in
money to order or bearer, and where drawn to m aker’s own order is
not complete until endorsed by him ; m ay be in installm ents.
A Check is a bill of exchange on a bank payable on dem and; m ust
be presented within reasonable tim e after issue and if dishonored
notice m ust be given or draw er is discharged to the extent of loss
caused by delay; does not operate to assign any p a rt of draw er’s
funds in bank and bank is not liable unless it accepts or certifies. If
holder has check certified th e draw er and endorsers are discharged.
The present negotiable instrum ent law of M ontana consisting of
198 sections w ent into force M arch 7, 1903. Its provisions do not
apply to instrum ents m ade prior thereto. T he act so m aterially
changes th e law in this S tate as to suggest th e propriety of special
examination in an y doubtful case.
This law is nearly if not quite identical w ith th a t now in force in
New York. Illinois, and other states.
R eplevin. The plaintiff in an action to recover possession of per­
sonal property m ay replevy the same a t the tim e or issuing summons
or at any tim e before answer, upon making affidavit showing th a t the
plaintiff is th e owner of the property or entitled to possession thereof,
that it is wrongfully detained, and has not been taken for a tax,
assessment or fine p ursuant to a sta tu te or seized under an attachm ent
or an execution against the plaintiff, or if so seized th a t it is exempt,
and also stating th e actual value of th e property. A dem and for the
delivery of th e property should be indorsed upon the affidavit and an
undertaking in double th e value of the property m ust be given.
The defendant has two days in which to except to plaintiff’s sureties,
or he m ay require th e retu rn of the property by giving an undertaking
m double th e value of th e property. I f such undertaking is not given
within five days from th e replevy th e property m ust be turned over
,to the plaintiff.
Taxes. All kinds of property, except public property and property
for beneficent purposes, are subject to tax for public purposes only.
Such taxes are a lien upon th e property, which lien has th e effect of
an execution levied on all such as are delinquent after the 30th day
of November, after which a penalty of 10 per cent is added. The
delinquent tax list is published in some newspaper on or before the
last Monday of each year, and in not less th an tw enty-one and not
more than tw enty-eight days after th e first publication sale of the
real estate is m ade, subject to redem ption w ithin thirty-six m onths
from date of sale. The purchase m oney draws interest a t 1 per cent
a month from th e date of sale. T he purchaser is entitled to a tax
deed a t th e end of th e thirty-six m onths b u t m ust give th irty days’
notice to th e owner or occupant of th e property. Taxes are assessed
to the p arty in whose nam e the property stands of record on the first
Monday in M arch of each year. P roperty assessed for th e following
percentages of full and tru e value: N et proceeds of mines, 100 per
cent; ail personal property for dom estic and agricultural use and
motor driven cars, 20 per cent; Livestock, agricultural products and
merchandise, 33j per c e n t;' real property and m anufacturing and
mining m achinery, 30 per cent; credits, except credits secured by
mortgage, which are exem pt, 7 per cent; N ational Bank shares and
Bank capital and other property, 40 per cent. W hen property bid
m by County, T reasurer m ay assign certificate to any person paying
the taxes. Redem ption m ay be m ade in thirty-six m onths, or a t any
time before deed applied for. Action to annul tax deed m ust be
brought in two years after date of issuance.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1767

E laborate inheritance law recently enacted. Tax runs from one
per cent to as high as 16 per cent. Exem ptions from $10,000 for
widow and $2,000 to each child down to $100 for stranger. Pro­
visions of law tbo elaborate and com plicated to m ake digest satis­
factory.
W ills. E very person over eighteen years of age and of sound mind
m ay dispose of all his estate, real and personal, b y will. All wills,
except nuncupative, m ust be in writing. And all wills, except nun­
cupative and holographic, m ust be executed and attested as follows:
1. M ust be subscribed by th e testa to r himself, or some one in his
presence and by .his direction, m ust subscribe his nam e thereto. 2.
The te sta to r’s signature m ust be m ade in th e presence of the attesting
witnesses or acknowledged to have been m ade by him or by his author­
ity. 3. The testa to r m ust declare to th e attesting witnesses th a t
th e instrum ent is his will. 4. T here m ust be two attesting witnesses
who m ust sign th e will a t th e testa to r’s request, in his presence. An
holographic will is one entirely w ritten by the testa to r himself and
subject to no form. The estate bequeathed b y a nuncupative will
m ust n ot exceed $1,000 in value, m ust be proved by tw o witnesses,
m ust have been m ade in actual contem plation, fear, or peril of death,
and m ust be proved w ithin six m onths after stating th e testam entary
words unless the substance thereof was reduced to writing within
th irty days after th ey were spoken. A will executed according to
law of th e S tate where th e testa to r was then domiciled m ay be pro­
bated in this State.

S Y N O P S IS OF

THE LAWS OF NEBRASKA
RELATING TO
B A N K I N G A N D C O M M E R C IA L U S A G E S
Revised by M

H a l l & Y o u n g , A ttorneys a t Law, O m aha.
(See Card in A ttorneys’ List.)

on tg om ery,

A c k n o w le d g m e n ts. (See Deeds, N otary Public) m ay be m ade
in this S tate before a notary, judge or clerk of any court, justice o f
th e peace, county clerk or deputy, register of deeds or de