Sec. 1171 b. Each bank or banking institution in the state to report 1897-8, p. 486. to the auditor of public accounts all money deposited in such bank or banking institution by order of any court.-Every bank or banking institution in this commonwealth in or with which any money has been deposited within the last seven years by order of any court of this state, such deposit being made to the credit of any fund in said court or under the control or in the custody of said court, and such fund or any part thereof remains in said bank or banking institution, such bank or banking institution shall in sixty days from the time this act shall take effect report to the auditor of public accounts the amount of money thus deposited, the amount thereof still remaining in said bank or banking institution, the court by whose order such deposit was made, the date of such deposit, and the style of suit or proceeding in such court wherein the order of deposit was made. The auditor of public accounts shall immediately after the passage of this act forward a copy thereof to each bank and banking institution in this commonwealth, and any bank or banking institution failing to make the report provided for by this act shall be subject to a fine of not less than five dollars nor more than twenty dollars for each day's continuance of such failure from the time a copy of this act shall be received by it, such fine to be recoverable upon motion of the auditor of public accounts and paid into the treasury of the state.

The auditor of public accounts shall enter in a book to be kept for that purpose the style of suit or other proceeding in which the order of deposit was made, the court in which such order was made, the amount deposited, the date of deposit, and the place where deposited.

Sec. 1173 a. State banks of circulation.-1. Associations for carrying on 1893-4, p. 977. the business of banking under this title may be formed by any number of natural persons not less in any case than five. They shall enter into articles of association, which shall specify in general terms the object for which the association is formed and may contain any other provisions not inconsistent with law which the association may see fit to adopt for the regulation of its business and the conduct of its affairs. These articles shall be signed by the persons uniting to form the association and a copy of them shall be forwarded to the secretary of the commonwealth to be filed and preserved in his office.

2. The persons uniting to form such an association shall under their hands make an organization certificate which shall specifically stateFirst. The name assumed by such association, which name shall be subject to the approval of the secretary of the commonwealth.

Second. The place where its operations of discount and deposit are to be carried on, designating the village, town, or city and county in which said bank is to be located.

Third. The amount of capital stock and the number of shares into which the same is to be divided.

Fourth. The names and places of residence of the shareholders and the number of shares held by each of them.

Fifth. The fact that the certificate is made to enable such persons to avail themselves of the authority to organize a state bank under this act. 3. The organization certificate shall be acknowledged before a judge of some court of record, notary public, or justice of the peace, and shall be, together with the acknowledgment thereof, transmitted to the secretary of the commonwealth, who shall record and carefully preserve the same in his office.

4. Upon duly making and filing articles of association and an organization certificate the association shall become, as from the date of the execu

tion of its organization certificate, a body corporate, and as such and in the name designated in the organization certificate it shall have power— First. To adopt and use a corporate seal.

Second. To have succession for the period of twenty years from its organization unless it is sooner dissolved according to the provisions of its articles of association, or by the act of its shareholders owning two-thirds of its stock, or unless its franchise becomes forfeited by some violation of law.

Third. To make contracts.

Fourth. To sue and be sued, complain and defend in any court of law and equity as fully as natural persons.

Fifth. To elect or appoint directors, and by its board of directors to appoint a president, vice-president, cashier, and other officers, define their duties, require bonds of them and fix the penalty thereof, dismiss such officers or any of them at pleasure, and appoint others to fill their places.

Sixth. To prescribe by its board of directors by-laws not inconsistent with law regulating the manner in which its stock shall be transferred, its directors elected or appointed, its officers appointed, its property transferred, its general business conducted, and the privileges granted to it by law exercised and enjoyed.

Seventh. To exercise by its board of directors or duly authorized officers or agents subject to law all such incidental powers as shall be necessary to carry on the business of banking by discounting and negotiating promissory notes, drafts, bills of exchange, and other evidences of debt; by receiving deposits; by buying and selling exchange, coin, and bullion; by loaning money on personal or real estate security, and by obtaining, issuing, and circulating notes according to the provisions of this act.

But no association shall transact any business except such as is incidental and necessarily preliminary to its organization until it has been authorized by the secretary of the common wealth to commence the business of banking.

5. A state banking association may purchase, hold, and convey real estate for the following purposes and for no other:

First. Such as shall be necessary for its immediate accommodation in the transaction of its business.

Second. Such as shall be mortgaged to it in good faith by way of security for debts.

Third. Such as shall be conveyed to it in satisfaction of debts contracted in the course of its dealings.

Fourth. Such as it shall purchase at sale under judgments, decrees, mortgages, or deeds of trust held by the association or shall purchase to secure debts due to it; but no such association shall hold the possession of any real estate under mortgage or deed of trust or the title and possession of any real estate purchased to secure any debts due to it for a longer period than five years; and no such association shall loan on any real estate more than onefourth of its assessed value, nor for a longer period than ninety days.

6. No association shall be organized under this act in any village or town with a less capital than ten thousand dollars, nor in any city with a less capital than fifty thousand dollars.

7. The capital stock of each association shall be divided into shares of one hundred dollars each and be deemed personal property, and tranferable on the books of the association in such manner as may be prescribed in the by-laws or articles of association. Every person becoming a shareholder by such transfer shall, in proportion to his shares, succeed to all the rights and liabilities of the prior holder of such shares, and no changes

shall be made in the articles of association by which the rights, remedies, or security of the existing creditors of the association shall be impaired.

8. At least fifty per centum of the capital stock of every association shall be paid in before it shall be authorized to commence business; and the remainder of the capital stock of such association shall be paid in installments of at least ten per centum each on the whole amount of the capital as frequently as one installment at the end of each succeeding month from the time it shall be authorized by the secretary of the commonwealth to commence business, and the payment of each installment shall be certified to the secretary of the commonwealth under oath by the president or cashier of the association.

9. Whenever any shareholder or his assignee fails to pay any installment on the stock when the same is required by the preceding section to be paid the directors of such association may sell the stock of such delinquent shareholder at public auction, having given three week's previous notice thereof in a newspaper published and of general circulation in the city or county where the association is located, or if no newspaper is published in said city or county then in a newspaper published nearest thereto, to any person who will pay the highest price therefor, to be not less than the amount due thereon, with the expenses of advertisement and sale, and the excess, if any, shall be paid to the delinquent shareholder. If no bidder can be found who will pay for such stock the amount due thereon to the association and the cost of advertisement and sale, the amount previously paid shall be for. feited to the association, and such stock shall be sold as the directors may order within six months from the time of such forfeiture; and if not sold it shall be cancelled and deducted from the capital stock of the association. If any such cancellation and reduction shall reduce the capital of the association below the minimum of capital required by law the capital stock shall within thirty days from the date of such cancellation be increased to the required amount; in default of which a receiver may be appointed as provided by section thirty-five of this act to close up the business of the association.

10. Any association formed under this act may, by its articles of association, provide for an increase of its capital from time to time as may be deemed expedient, subject to the limitations of this act. But the maximum of such increase to be provided in the articles of association shall be determined by the secretary of the commonwealth, and no increase of capital shall be valid until the whole amount of such increase is paid in and notice thereof has been transmitted to the secretary of the commonwealth and his certificate obtained specifying the amount of such increase of capital stock, with his approval thereof, and that it has been duly paid in as part of the capital of such association.

11. Any association formed under this act may, by the vote of shareholders owning two-thirds of its capital stock, reduce its capital to any sum not below the amount required by this act to authorize the formation of associations; but no reduction shall be allowed which will reduce the capital of the association below the amount required for its outstanding circulation, nor shall any such reduction be made until the amount of the proposed reduction has been reported to the secretary of the commonwealth and his approval thereof obtained.

12. In all elections of directors and in deciding all questions at meetings of shareholders each shareholder shall be entitled to one vote on each share of stock held by him. Shareholders may vote by proxies duly authorized in writing, but no officer, clerk, teller, or bookkeeper of such

association shall act as proxy; and no shareholder whose liability is past due and unpaid shall be allowed to vote.

13. The affairs of each association shall be managed by not less than five directors, who shall be elected by the shareholders at a meeting to be held at any time before the association is authorized by the secretary of the commonwealth to commence the business of banking, and afterwards at meetings to be held on such day in January of each year as is specified therefor in the articles of association. The directors shall hold office for one year and until their successors are elected and qualified.

14. Every director must, during his whole term of service, be a citizen of Virginia and the owner of at least ten shares of the capital stock of the association in his own right of which he is a director. Any director who ceases to be the owner of ten shares of the stock or who becomes in any other manner disqualified shall thereby vacate his place.

15. Each director when appointed or elected shall take an oath that he will, so far as the duty devolves on him, diligently and honestly administer the affairs of such association, and will not knowingly violate or willingly permit to be violated any of the provisions of this act, and that he is the owner in good faith and in his own right of the number of shares of stock required by this act subscribed him or standing in his name on the books of the association, and that the same is not hypothecated or in any way pledged as security for any loan or debt. Such oath, subscribed by the director making it and certified by the officer before whom it is taken, shall be immediately transmitted to the secretary of the commonwealth and shall be filed and preserved in his office.

16. Any vacancy in the board shall be filled by appointment by the remaining directors, and any director so appointed shall hold his place until the next election.

17. If from any cause an election of directors is not made at the time appointed the association shall not for that cause be dissolved, but an election may be held on any subsequent day, thirty days' notice thereof in all cases having been given in a newspaper published in the city, town, or county in which the association is located; and if no newspaper is published in such city, town, or county such notice shall be published in a newspaper published nearest thereto. If the articles of association do not fix the day on which the election shall be held, or if no election is held on the day fixed, the day for the election shall be designated by the board of directors in their by-laws or otherwise; or if the directors fail to fix the day shareholders representing two-thirds of the capital stock may do so. 18. One of the directors, to be chosen by the board of directors, shall be president of the board.

19. The shareholders of every state banking association shall be held individually responsible equally and ratably, and not one for another, for all contracts, debts, and engagements of such association to the extent of the amount of their stock therein at the par value thereof, in addition to the amount invested in such shares.

20. Persons holding stock as executors, administrators, guardians, or trustees shall not be personally subject to any liabilities as stockholders, but the estates and funds in their hands shall be liable in like manner and to the same extent as the testator, intestate, ward, or person interested in such trust funds would be if living and competent to act and hold the stock in his own name.

21. Every association after having complied with the provisions of this act preliminary to the commencement of the banking business and before it shall be authorized to commence banking business under this act shall

transfer and deliver to the treasurer of Virginia any Virginia bonds issued under the act approved February twentieth, eighteen hundred and ninetytwo, to the amount of the capital stock of said association. Such bonds shall be received by the treasurer of Virginia upon deposit, and shall be by him kept in his office until they shall otherwise be disposed of in pursuance of the provisions of this act.

22. The deposit of bonds made by each association shall be increased as its capital may be increased or may be reduced as its capital stock may be reduced. And any association that may desire to reduce its capital stock or to close up its business and dissolve its organization may take up its bonds upon returning to the secretary of the commonwealth its circulating notes issued on the faith of said bonds.

23. All transfers of Virginia bonds made by any association under the provisions of this act shall be made to the treasurer of Virginia in trust for the association, with a memorandum written or printed on each bond and signed by the cashier or some other officer of the association making the deposit. A receipt shall be given to the association by the treasurer of Virginia stating that the bond is held in trust for the association on whose behalf the transfer is made and as security for the redemption and payment of any circulating notes that may have been or may be delivered to such association. No assignment or transfer of any such bond by the treasurer of Virginia shall be deemed valid unless countersigned by the secretary of the commonwealth.

24. The bonds transferred to and deposited with the treasurer of Virginia for the security of its circulating notes shall be held exclusively for that purpose until such notes are redeemed or taken in and cancelled and delivered to the treasurer of Virginia, who shall cause the same to be destroyed in the presence of the governor and attorney-general of Virginia. The treasurer of Virginia shall give to any such association power of attorney to receive and appropriate to its own use the interest on the bonds which it has so transferred to the treasurer, but such power of attorney shall become inoperative whenever such association fails to redeem its circulating notes. 25. Whenever a certificate is transmitted to the secretary of the commonwealth certifying that the whole amount of capital stock has been paid in and that Virginia bonds issued under the act approved February twentieth, eighteen hundred and ninety-two, has been deposited with the treasurer of Virginia equal to the amount of said capital stock, the secretary of the commonwealth shall examine into the condition of such association, ascertain especially the amount of money paid in on account of its capital, the name and place of residence of each of its directors and the amount of capital stock of which each is owner in good faith, and generally whether such association has complied with all the provisions of this act to entitle it to engage in the business of banking, and shall cause to be made and attested by the oaths of a majority of the directors and by the president or cashier of the association a statement of all the facts necessary to enable the secretary of the commonwealth to determine whether the association is lawfully entitled to commence the business of banking.

26. If upon careful examination of the facts so reported and of any other facts which may come to the knowledge of the secretary of the commonwealth it appears that such association is lawfully entitled to commence the business of banking, the secretary of the commonwealth shall give to such association a certificate under his hand and official seal that such association has complied with all the provisions required to be complied with before commencing the business of banking and that such association is authorized to commence such business. But the secretary of the common