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ity.

person paying such consideration, and shall be punished the same Penalty. as persons guilty of obtaining property or money by false pretenses designedly, with intent to defraud or cheat another, and shall also Extent of liabilbe liable in damages to the person from whom the money, note, or obligation was obtained, in an action in the case for double the amount of the money and note or obligation so obtained, and shall also be jointly and severally liable to the person insured, to pay all losses covered by such insurance: Provided, That the said com- Proviso. pany may proceed with its business, receiving money, issuing policies, whenever the circuit judge for the judicial district where the office of said company is located shall certify, from proof adduced before him, either that such publication was by mistake, or that the directors, officers, or agents making the same have been dismissed from the service of the said company, and whenever, also, the said company shall publish such true statement of its affairs as the said circuit judge shall direct.'

does not pay all

ten days after re

(2933.) SEC. 20. If any mutual insurance company, organized When company or to be organized under this act, or the act or acts of which this claims within is amendatory, shall not within sixty days after the Secretary of ceiving notice. State shall have given the notice required by section twelve of act number two hundred and sixty-two of the Session Laws of eighteen hundred and fifty-nine, pay up and discharge all outstanding claims against such company, for losses by fire, it shall be the duty Secretary of State's petition of the Secretary of State to file a petition in the circuit court for published. any county where such company has transacted business, either in vacation or term time, stating that the sixty days within which such company was required to proceed to wind up its business have expired, and that there are outstanding claims against such company for losses by fire, a copy of which said petition shall be published for three successive weeks in a public newspaper printed in such county, or in any daily newspaper printed in the city of Detroit.'

and appoint.

ceiver.

(2934.) SEC. 21. At any time after such publication, the Secre- Application for,: tary of State may appear in said court, in person or by counsel, and ment of a remove for the appointment of a receiver for said company, and the said company may also be heard, and upon such hearing the report of such company filed in the office of the Secretary of State shall be conclusive evidence of the facts therein stated, and of the liability of such company, unless such company shall show that they have since paid and discharged the liabilities; and if upon the hear

1 Vide note to section 17 of this act.

Powers and duties.

Assessment to pay losses.

Notice.

ing thereof it shall appear to such court that the statements in such petition are materially true, the said court shall appoint a receiver for such company, who shall be and is hereby empowered to take possession of all books and papers and personal property of said company, and shall ascertain the amount due from said company for losses by fire on property insured, and shall at once proceed to assess upon all of the stockholders and persons insured in such company, such sums of money as will in the aggregate be sufficient to pay all the losses and liabilities of said company, together with the services and expenses of such receiver, according and in proportion to the amount of their insurance stock or interest in such company, in the classes wherein the losses occurred or liabilities arose, respectively; and upon payment of such assessment the said stockholders shall be discharged of and from all former assessments made by such company; and it shall be the duty of said receiver to give notice of such assessment by publishing in some weekly newspaper printed in the city of Detroit, once in each week for three successive weeks, a general notice, stating therein the aggregate amount assessed upon each of the classes in said company; and, upon application, he shall furnish to any person assessed a statement showing the amount of his assessment; and in case any stockholders, or person insured, so assessed, shall neglect for thirty days after such publication to pay the amount of such assessment to said receiver, he may sue for the same in the circuit court wherein he was appointed, and in such cases service may be made upon the persons sued in any county in the State; or at his election the receiver may sue in the circuit court for the county wherein the person assessed, or who is liable to pay such assessment, may reside or be, in an action of debt or assumpsit, in his own name, as receiver of said company; and upon such suit said assessment shall be prima facie evidence of the regularity and correctness of all proceedings up to and including the assessment, and of the receiver's right to recover therein the amount assessed, with costs. If the amount realized by such receiver from any class be insufficient to pay the losses and liabilities therein, and the services and expenses aforesaid, he shall proceed to make a second assessment, and such further or other assessments as may be necessary to realize the same, in the same manner and with the like effect as is herein provided for making the first assessment, and shall sue for and collect the same in the same manner. If, after Surplus refund paying the losses and liabilities of such company, or of any class thereof, and the services and expenses aforesaid, 'there shall remain

Collection.

Second asses8.

ment may be made.

ed.

any funds in the hands of the receiver, the same shall be paid back to the persons assessed in just and equal proportions to the sums contributed and paid by them.1

and account of

(2935.) SEC. 22. Such receiver shall keep an accurate account of Pay of receiver all moneys or other property received by him, and shall pay over receipts. all moneys by him collected, and the proceeds of all personal property pro rata upon said losses, after deducting therefrom for his services and expenses (if the court making such appointment shall deem the amount thereof reasonable). The court making such Bond. appointment may also require such receiver to give a bond, with sufficient sureties, in such penal sum as such court shall determine, which said bond shall run to the people of the State of Michigan, and be conditioned for the faithful discharge of his duties as such receiver (and be approved by the clerk or judge of said court), and Reports. said court may from time to time require such receiver to make a report, and upon the coming in of his final report, showing a full Final report and and faithful performance of such trust, may discharge him from all liability. further liability. This act shall be construed as applying to all receivers appointed under the act to which this is amendatory, as well as to receivers which may hereafter be appointed. '

1 Added by Act 208, Laws of 1867, p. 289, and amended by Act 171 of the Laws of 1871, p. 277, approved and took effect April 17, 1871.

1 Vide note to section 21.

discharge from

CHAPTER XCVIII.

LIFE INSURANCE COMPANIES.

Thirteen persons may form a company.

insure risks.

An Act in relation to life insurance companies transacting business within this State.

[Approved March 30, 1869. Laws of 1869, p. 124.]

(2936.) SECTION 1. The People of the State of Michigan enact, That any number of persons, not less than thirteen, may associate together and form an incorporated company for the purpose of making insurance upon the lives of individuals, and every insurance pertaining thereto, and to grant, purchase, and dispose of Authority to re- annuities. Every company organized under this act shall have authority to reinsure any risk herein authorized to be undertaken by them, and to grant reinsurance upon any similar risk undertaken Confined to life by any other company, but shall not have power to undertake marine and fire risks, or any other species of insurance whatever, except upon lives, or to be in any way connected in their business with any company undertaking other risks than upon the lives of individuals.

insurance exclu

sively.

Articles; contents of.

Names, etc., of associates.

Name.

Office.

Purposes.

(2937.) SEC. 2. The persons so associating shall subscribe articles of association, which shall contain

First. The names of the associates, and their places of residence, respectively;

Second. The name by which the corporation shall be known, and the place where its principal office for the transaction of business is to be established, and the period for which it is to be incorporated; Third. The purposes of the incorporation, as mentioned in the first section of this act;

be exercised.

Fourth. The manner in which the corporate powers are to be How powers to exercised; the number of directors and other officers, and the officers, how manner of electing the same, and how many of the directors shall constitute a quorum, and the manner of filling all vacancies;

elected, etc.

Fifth. The amount of the capital stock, if any, and what propor- Capital stock. tion is to be paid in before the corporation shall commence business;

Sixth. The time for the holding of the annual meetings of the Annual meetings corporation; and,

membership.

to be filed with

Seventh. Any terms and conditions of membership therein which Conditions of the corporators may have agreed upon, and which they may deem important to have set forth in such articles. And the said corpo- Articles to be published. rators shall publish a copy of said articles, with notice of their intention to become incorporated under the same, in some newspaper published in the county where their principal office is to be located, once in each week for at least four weeks before filing such articles as hereinafter provided; and, at the time of filing such Proof of same articles, they shall also file with the Secretary of State proof of Secretary of such publication. (2938.) SEC. 3. The persons so associating shall, after having Books of subpublished such articles and notice, open books of subscription to the capital stock of the corporation, and keep the same open until the whole amount specified in the articles shall be subscribed; or, if said corporation is to transact business on the mutual plan, then they shall open books to receive propositions, and enter into agreements, as hereinafter specified.

State.

scription.

stock companies

creased.

(2939.) SEC. 4. The capital stock of any stock company organ- Capital stock of ized under this act, shall not be less than one hundred thousand to be $100,000. dollars, in shares of fifty dollars each, which capital stock may be Shares $50 each. increased by a vote of two-thirds of the stockholders present or How capital inrepresented at any regular meeting called for the purpose, to not more than five hundred thousand dollars; and no such stock com- $100,000 to be deposited with pany, and no company organized to do business on the mutual State Treasurer. plan, shall be authorized to issue policies, or assume any risks whatever, until they shall have deposited with the State Treasurer, as security for any liability to insured parties, stocks or bonds of this State or of the United States, to the amount, in par value, exclusive of interest, of not less than one hundred thousand dollars, which stock or bonds shall be retained by the State Treasurer, and disposed of as hereinafter directed: Provided however, That per- Proviso. sonal obligations, secured by first mortgages on real estate within this State, worth, exclusive of all buildings, at least double the amount of the lien, and bearing an interest of not less than seven

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