S. 56 (1) to the Commissioners to and by societies, and those regulations shall, amongst other things (a) provide for crediting to each society the values; reserve "Make regulations."- See s. 65 and Appendix II—40, p. 728. "Paid . . . to societies."-These payments are not apparently limited to the amount of the society's credit; but are limited under s. 54 (1) to expenditure properly incurred, i.e., for minimum or additional benefits and management. "The amounts retained."-These are also credited [s. 55 (4)], but not to the same societies. (6) require the Insurance Commissioners, on carrying any sum to the credit of an approved society in the investment account, to pay over to the society for investment, or, at the request of the society, to retain for investment on behalf of the society foursevenths, or, so far as the sums are attributable to women, one-half, of the amount so credited to the society; See Appendix II-40, art. 12, p. 734. "Investment account."-See s. 54 (3) and note thereto. "At the request of the society."-The effect of making such a request is that the society may be exempted from giving other security to the Commissioners (s. 26 (1)]. "Retain for investment."-See subs. (3) hereof. "Amount so credited."-The words "so credited" clearly refer to the process of crediting under par. (a) hereof. The sum to be paid over under this paragraph must be estimated before any sum can be carried to the Investment Account under s. 54 (3). The clear intention of the section is that the balance of the member's contribution should be paid to his society, and the balance of the employer's contribution to the Investment Account, (c) provide for crediting to each society interest at S. 56 (1) the prescribed rate per annum on the sums for the time being standing to the credit of "The prescribed rate."-The actuarial calculations upon which the financing of the benefits is based are made on the assumption that the rate of interest will be 3 per cent. ; any higher rate obtained will increase the possibility of additional benefits, but will have no effect in diminishing the period for extension of benefits after substitution of reserve values. (d) provide for the discharge of debit balances in such manner as the Insurance Commissioners determine, either by the reduction of the reserve values credited to the society or out of the proceeds of the realisation of securities held by the society or by the Commissioners on behalf of the society, and out of the sums standing to the credit of the society in the investment account proportionately: "Reduction of the reserve values."-See s. 43 (1) (a), and the proviso to s. 44 (2). The effect of reducing the reserve values is to penalise the society concerned by diminishing its share of the credits given from time to time under s. 55 (4). "Sums standing to the credit."-Approved societies are not concerned with the fluctuations in capital value of securities held by the National Debt Commissioners for the Investment Account, but are absolutely entitled, for the purpose of discharging their debit balances, to the sums so standing to their credit. (Cf. the provisions of the various Savings Banks Acts.) Provided that, in the case of any society which gives notice to that effect to the Insurance Commissioners, no part of the sums carried to the credit of the society in the investment account shall be paid over to the society or retained by the Commissioners for investment on its behalf, but the whole amount shall remain to the credit of the society in (c) (d) S. 56 (1) the investment account, and in such case the regulations made under the foregoing provisions shall apply to the society subject to the prescribed modifications. "Notice.”—The effect of such notice will be to relieve the society from the task of supervising its investments, to guarantee its funds, and to relieve it of the need for giving security. "No part."-The society cannot apparently by notice require the Commissioners to invest a part of the sums due and pay over the balance. It is, however, submitted that such notice does not bind all funds thereafter becoming due, but may be limited to the funds immediately payable. Quare whether the notice can be withdrawn and the funds demanded. Apparently not. (2) Every approved society shall invest any sums paid to the society for investment, and shall for the purpose have power to invest in any securities in which trustees are for the time being by law empowered to invest trust funds, or in any stocks, mortgages, or other securities issued by any local authority within the meaning of the Local Loans Act, 1875, and charged on any rates levied by or on the order or precept of such authority, or in any other securities for the time being approved by the Insurance Commissioners. "Trust Funds."-The securities referred to are: (a) Parliamentary stocks or public funds, or Government securities, of the United Kingdom, including Bank Annuities and Exchequer Bills (see Brown v. Brown, 4 K. & J. 704; Slingsby v. Grainger, 7 H.L.C. 273). (b) Real or heritable securities in Great Britain or Ireland: i.e. on mortgage, but not purchase, of fee simple or copyhold lands in England and Wales, and in Scotland also of heritable leaseholds, and in Ireland also of leaseholds perpetually renewable with a headrent (Macleod v. Annesley, 16 Beav. 600) or of lands held upon fee-farm grants under 12 and 13 Vict. c. 105 and 31 and 32 Vict. c. 62. But trustees should not invest upon a contributory mortgage (Dive v. Roebuck, 1909, 1 Ch. 328) a second or other deferred mortgage (Drosier v. Brereton, 15 Beav. 226; Chapman v. Browne, 1902, I Ch. 785), a deposit of title deeds (Swaffield v. Nelson, 1876, W.N. 255) a stock mortgage (Whitney v. Smith, L.R. 4 Ch. 513), a mortgage of unfinished houses or other buildings (Walker v. Walker, 59 L.J. Ch. 386), or a mortgage of real property held for lives (Head v. Gould), S. 56 (2) 1898, 2 Ch. 250). Trustees should not invest upon mortgage of property belonging to one of themselves (Francis v. Francis, 5 De G. M. and G. 108), and would probably be well advised not to advance the society's money upon mortgage to other officers of the society, but there is no reason why they should not advance it to other members, if the security is suitable. (c) Stock of the Banks of England or Ireland. (d) India 3 and 3 per cent. stocks, or other capital stocks issued by the Indian Government under statutory authority, and charged upon the revenues of India. (e) Securities the interest of which is for the time being guaranteed by Parliament (see In re National Permanent Building Society, 1890, W.N. 117). (ƒ) Consolidated stock created by the Metropolitan Board of Works or by the L.C.C., or debenture stock created by the Receiver for the Metropolitan Police District. (g) Debenture, rent-charge, guaranteed or preference stock of any railway company in Great Britain or Ireland incorporated by special Act of Parliament, and having paid a dividend during each of the 10 years preceding the investment. (h) Stock of any railway or canal company in Great Britain or Ireland whose undertaking is leased in perpetuity, or for a term of not less than 200 years at a fixed rental to any such railway company as is mentioned in (g), either alone or jointly with any other railway company. (i) Indian guaranteed railway stocks or shares, provided they are not redeemable within 15 years from the date of investment, or debenture stocks of such railway companies, the interest on which is paid or guaranteed by the Indian Government, even if so redeemable. (j) "B" annuities of the Eastern Bengal, East Indian, and Scinde, Punjaub and Delhi Railways, and any like annuities created since 1893 or in future, on the purchase of any railway by the Indian Government, charged on the revenues of India, and authorised by statute to be accepted by trustees in lieu of any stock held by them in the purchased railway; also deferred annuities Class D, and annuities Class C of the East Indian Railway Company. (k) Stock of any Indian railway company upon which a fixed or minimum dividend in sterling is paid or guaranteed by the Indian Government, or upon the capital of which the interest is so guaranteed. (7) Debenture, guaranteed or preference stock of any company in Great Britain or Ireland, established for the supply of water for profit, and incorporated by special Act of Parliament or by Royal Charter (not under the Companies Acts), and having during each of the 10 years preceding the investment paid a dividend of not less than 5 per cent. on its ordinary stock. (m) Nominal or inscribed stock issued or to be issued by the corporation of any municipal borough having, according to the returns of the last census prior to the date of investment, a population exceeding 50,000, or by any county council under the authority of any Act of Parliament or Provisional Order. (n) Similar stock of any commissioners incorporated by Act of Parliament for the supply of water, and having a compulsory power S. 56 (2) of levying rates over an area having a similar population, provided that during each of the 10 years preceding the investment, the commissioners have not levied more than 80 per cent. of the amount of rates authorised by law. (0) Stocks, funds, or securities, for the time being authorised for the investment of cash under the control or subject to the order of the High Court. See O. XXII. r. 17: the whole of the securities so authorised are included in the above list, except (p) "Nominal Debentures or Nominal Debenture Stock under the Local Loans Act, 1875; provided that in each case such debentures or stock shall not be liable to be redeemed within 15 years from the date of investment." The above is the list of investments authorised by the Trustee Act, 1893, s. 1, and O. XXII. r. 17. To this list must be added (9) Colonial stock registered in the United Kingdom in accordance with the provisions of the Colonial Stock Acts, 1877 to 1900, and with respect to which there have been observed such conditions (if any) as the Treasury may, by order notified in the London Gazette, prescribe (63 & 64 Vict. c. 62, s. 2). (r) Metropolitan Water Stock [Metropolis (Water) Act, 1902, s. 17 (4)]. By s. 2 of the Act of 1893 trustees may (unless expressly forbidden) invest in redeemable stocks at a price above the redemption value, except in the case of stocks authorised by paragraphs (g) (i) (k) (1) (m) and (9) above if the stock is redeemable within 15 years at par or some other fixed rate, or if it is redeemable at such rate at any time and the price is more than 15 per cent. above such rate. They may hold redeemable stocks until redemption, and may from time to time vary any investment. "In any other securities."-These words will not apparently cover the purchase of land. See the Charitable Funds Investment Act, 1870, and as to the meaning of "securities" generally, see re Rayner (1904), I Ch. 178, at p. 189. 66 Local Authority. . . Local Loans Act, 1875."—" Means the justices (now the Council) of any county, liberty, riding, party, or division of a county. . . the council of any municipal borough, also any authority whatever having power to levy a rate, as in this Act defined, and also any prescribed authority" (38 & 39 Vict. c. 83, s. 34). "Rates."-See definition of a rate in the Local Loans Act, 1875, loc. cit. See Appendix I—1, 12 (2), p. 449. The Trustees of the society are entitled to an indemnity against the funds of the society in respect of covenants properly entered into by them in connection with the investment of the funds of the Society. [Wise v. Perpetual Trustee Co. (1903), A.C. 139]. (3) Where, at the request of a society, the Insurance Commissioners instead of paying over any sum to the society retain such sum for investment on behalf of the society, they shall invest such sum in accordance with the directions of the society in any securities in which the society might have |