CHAP. III.

lectible out

any other State. The avails of said tax shall be paid into the State treasury, and shall be applicable, as far as necessary, toward deWhen col- fraying the expenses of the insurance department. In case of negof interest lect or refusal by any such company to pay said tax the superintendent is hereby authorized to collect the same out of the interest on the stocks and securities deposited by such company in the insurance department. [As amended by Laws of 1862, chap. 300, § 5.]

on secur

ities.

Fees to be paid to county clerk.

Superintendent to cause ex

amination

Books to

tion.

International Life Assurance Society v. Commissioners of Taxes, 28 Barb. 318; British Commercial Life Ins. Co. v. Commissioners of Taxes, 18 Abb. Pr. 130; The People v. The New England Mutual Life Ins. Co., 26 N. Y. 303.

(See Laws of 1861, chap. 334, § 1, post, p. 123, and Laws of 1867, chap. 708, § 4, post, P. 79, on subject of annual statements.)

§ 16. Every county clerk shall demand and receive, for every paper filed in his office under this act, the sum of ten cents, to be accounted for and paid to the county treasurer as now provided with regard to other fees. [As modified by Laws of 1859, chap. 366, §§ 7, 8, ante, pp. 6 and 7.]

§ 17. It shall be the duty of the superintendent of the insurance department, whenever he shall have good reason to suspect the corto be made. rectness of any annual statement, or that the affairs of any company, required by law to make such statement, are in an unsound condition, to cause an examination to be made, for the purposes named in this act, into the affairs of any such insurance company, or any inbe opened surance company doing business by its agencies in this State; and for inspec- it shall be the duty of the officers or agents of any insurance company, incorporated or doing business in this State, to cause their books, and the books of such companies, to be opened for the inspection of the said superintendent and the person or persons appointed by him to make such examination, and otherwise to facilitate such examination, so far as it may be in their power so to do; and for that purpose the said superintendent or the person or persons so appointed by him, shall have power to examine, under oath, the officers and agents of any company relative to the busiPublishing ness of such company; and whenever the said superintendent shall deem it for the interest of the public so to do, he shall publish the result of such investigation in the State paper. Whenever it shall appear to the said superintendent from the statement of capital any life or casualty insurance company made to the insurance deimpaired. partment, or from an examination of the affairs of any such company (if a stock company), that its capital stock is impaired to

Examin

ation of officers.

result.

Duty of superintendent

where

stock is

CHAP. III.

make capi

attorney

the extent of fifty per cent thereof, it shall be the duty of the said superintendent, if the company is organized under the laws of any other State or country, to revoke the certificate of authority issued to the agent or agents of any such company, and shall cause a notice thereof to be published in the State paper for four weeks, and the agent or agents of such company are, after such notice, required to discontinue the issuing of any new policies. If the company so impaired is organized under the laws of this State, it shall be the duty of said superintendent to direct the officers thereof to require the stockholders to make good in cash the amount of such deficiency within ninety days after the date of his requisition. And in case of the failure of the stockholders to comply with such Failure to demand, it shall be the duty of the superintendent to report the tal stock facts to the attorney-general, who shall thereupon bring an action good. in the supreme court for the dissolution of the corporation. And Action by in case it shall satisfactorily appear to the court that the assets general. and funds of the company are not sufficient to justify the further Winding continuance of the business of insuring lives, granting annuities up. and incurring new obligations, as authorized by its charter, the court shall render judgment dissolving such company, and directing a distribution of its assets, exclusive of those deposited with the superintendent of the insurance department. Provided that any company organized under the laws of this State, whose capital is impaired as above fifty per cent, may by a vote of a majority of its directors at a meeting called for that purpose reduce its Reducing capital stock to an amount not less than one hundred thousand dol- stock. lars; and the said directors are hereby empowered to issue new certificates of stock to the stockholders for the amount of the reduced capital, and require in return all certificates previously issued, Whenever it shall appear to the superintendent that the assets of any Action for of the companies referred to in this section, other than stock for failure companies, are insufficient to reinsure its outstanding risks, he shall communicate the facts to the attorney-general, whose duty it shall then be to bring an action in the supreme court for the dissolution of such company. And in case it shall satisfactorily appear to the court in such action that the assets and credits of the company are of dissolunot sufficient to reinsure its outstanding risks, the court shall render judgment dissolving the company and directing a distribution of its assets, exclusive of the securities deposited with the superintendent of the insurance department. In any action authorized ings. by this section the court may prescribe the time within which the

capital

dissolution

of assets.

When judgment

tion to be granted.

Proceed

CHAP. III.

Distribution.

company proceeded against shall answer, and may hear and try the issues at such time, in such manner, and upon such notice as the court may direct; and may appoint a referee to inquire into and report upon the facts; and shall have power to grant such orders, and in its discretion, from time to time, to modify or revoke the same, as the facts or evidence in the case, and the situation of the parties and the interests involved shall seem to require. After the rendition of any judgment referred to in this section, the court shall have power to order the distribution, by the superintendent, of the securities and funds deposited with and held by him under the provisions of this act. And in estimating the condition of any life insurance company under the provisions of this act, the superintendent shall allow as assets only such investments as are authorized by the existing laws of the State at the date of examination, and shall charge as liabilities in addition to the capital stock all outstanding indebtedness of the company and a premium reserve on policies, and additions thereto in force, based on net premiums, American experience table of mortality, with four and one-half per cent interest. And in estimating the condition of any casualty insurance company under the provisions of this act, the superinpany, how estimated. tendent shall allow as assets only such investments as are authorized by the existing laws of the State at the date of his investigation; and shall charge as liabilities, in addition to the capital stock, all outstanding indebtedness of the company and a premium reserve on policies in force equal to the unearned portions of the premiums paid by the insured for covering the risks, computed on each respective risk from the date of the issuance of the policy. The report of examination of the affairs of a company, every made pursuant to this act, shall be verified by the person making such examination, to be just and true in all respects according to the best of his knowledge and understanding, and when so verified shall be presumptive evidence in all courts and legal proceedings. The expense of any examination made under this section shall be borne by the company whose affairs are so examined, to be paid by the company to the State treasurer after being approved by the superintendent of the insurance department and audited by the comptroller. [As amended by Laws of 1879, chap. 161, § 2.]

Condition of com

Vertification of report.

Expense.

Ruggles v. Chapman, 59 N. Y. 163; People, ex rel. Stout, v. Chapman, 5 Hun, 225; People, ex rel. v. Chapman, 64 N. Y 557; Bedell v. North America Life Ins. Co. 7 Daly, 273; Attorney-General v. Continental Life Ins. Co., 53 How. 16; People v. Security Life Ins. & Annuity Co., 78 N. Y. 114; People, ex rel. v. Security Life Ins. Co., 71 id. 222; Matter of Guardian

Mutual Life Ins. Co., 13 Hun, 115; Affirmed, S. C., 74 N. Y. 617; Attorney-General v. Guardian Mutual Life Ins. Co., 77 id. 272; AttorneyGeneral v. Guardian Mutual Life Ins. Co., 82 id. 336; Attorney-General v. North America Life Ins. Co., id. 172; Attorney-General v. North America Life Ins. Co., 26 Hun, 294; People v. Globe Mutual Life Ins. Co., 60 How. 57; id. 83; Attorney-General v. Continental Life Ins. Co., 62 How. 130; Attorney-General v Continental Life Ins. Co., 27 Hun, 195; Attorney-General v. Continental Life Ins. Co., 88 N. Y. 77, 571.

(This act shall not impair or affect any action or proceedings now pending in any court against any insurance company, but the courts shall have the same power to proceed in such actions or proceedings to final decision, decree or judgment as if this act had not been passed. [Laws of 1879, chap. 161, § 3.])

(All acts or parts of acts inconsistent herewith are hereby repealed. [Laws of 1879, chap. 161, § 4.])

(See Laws of 1881, chap. 486, § 3, post, p.184.)

CHAP. III.

violation of

§ 18. Every violation of this act shall subject the party violat- Penalty for ing to a penalty of five hundred dollars for each violation, which this act. shall be sued for and recovered in the name of the people, by the district attorney of the county in which the company or agent or agents so violating shall be situated, and one-half of such penalty, when recovered, shall be paid into the treasury of such county, and the other half to the informer of such violation; and in case of the non-payment of such penalty, the party so offending shall be liable to imprisonment for a period not exceeding six months, in the discretion of any court having cognizance thereof. The People v. McCann, 67 N. Y. 506.

ings in case

wishes to

its business.

rities to be

up by

19. When any company, transacting the business of insurance Proceedunder either of the departments specified in the first section of company this act, within the State of New York, shall desire to relinquish relinquish its business, the superintendent of the insurance department shall, on application of such company or association, under the oath of the president or principal officer and secretary or actuary, give notice of such intention in the paper in which the State notices are directed to be inserted, at least twice a week for six months, When secu and after such publication he shall deliver up to such company or delivered association the securities held by him, belonging to them, on be- superining satisfied by the exhibition of the books and papers of such company or association, and on examination, to be made by himself or some competent person, not officer of any life insurance company in this State, to be appointed by him, and upon the oath of the president or principal officer and the secretary or actuary of the same, that all debts and liabilities of every kind are paid and extinguished that are due or may become due upon any contract or agreement made with any citizens of the United States. And the said superintendent may also from time to time deliver

tendent.

CHAP. III.

Manner of

ing busi

ness.

up to such company or association, or its assigns, any portion of
said securities, on being satisfied in manner and form aforesaid, or
by any
other competent proof, that all the debts and liabilities of
every kind that are due or may become due upon any contract or
agreement made with any citizen of this State by said company
or association are less than one-half of the amount of the portion
of said securities he shall still retain.

Any foreign life insurance company desiring to discontinue discontinu- business in this country, and having made the aforesaid publication, may, in the discretion of the superintendent of the insurance department, withdraw one-half of its deposits of one hundred thousand dollars, on registering, according to the provisions of law for registered policies, all its outstanding policies, issued to citizens or residents of the United States, and covenanting to maintain unimpaired the reinsurance deposit for such registered policies at all future times, and specially pledging for their security all future premiums payable on American policies. [As amended by Laws of 1859, chap. 263, § 1, and by Laws of 1869, chap. 829, § 1.]

Charter to continue until repealed.

Any existing company may avail themselves of this act.

May increase capital stock.

Parts of

acts of 1849 and 1851, repealed.

§ 20. Every charter created by or under the laws of this State, for the purposes aforesaid, shall continue until repealed. Thomas v. Whallon, 31 Barb. 176.

§ 21. Any existing company incorporated by or authorized under the laws of this State, for the purposes mentioned in this act, may avail themselves of the provisions of this act, after publishing their intentions for six weeks in the State paper, and obtaining the consent of the majority of the trustees or directors, and complying with the third section of this act, in relation to the filing and contents of the declaration therein referred to. And any existing company incorporated by or authorized under the laws of this State, or any company formed under this law, to transact the business embraced in the second department of section one of the act hereby amended, may at any time increase the amount of its capital stock upon the same proceedings being had as are required by a fire insurance company, as provided in chapter four hundred and sixty-six of the laws of eighteen hundred and fifty-three, with the amendments thereto. [As amended by Laws of 1880, chap. 427.]

(See Laws of 1853, chap. 466, § 19, ante, p. 24.)

§ 22. So much of the act of April tenth, eighteen hundred and forty-nine, and of April eighth, eighteen hundred and fifty-one, as relate to life insurance, is hereby repealed, but this section shall not affect any company incorporated under such acts.