10. To be appointed and to accept the appointment of executor of or trustee under the last will and testament, or administrator with or without the will annexed, of the estate of any deceased person, and to be appointed and to act as the committee of the estates of lunatics, idiots, persons of unsound mind and habitual drunkards.

11. To exercise the powers and possess the privileges conferred on banks. and individual bankers by sections fifty-five and fifty-six of this chapter, subject to the restrictions contained in said sections. No such corporation shall have any right or power to make any contract, or to accept or to execute any trust whatever, which it would not be lawful for any individual to make, accept or execute. No loan exceeding in amount one-tenth of its capital stock shall be made by any such corporation (directly or indirectly), to any director or officer thereof, and no loan to such director or officer shall be made without the consent of a majority of the directors. No such corporation shall transact its ordinary business by branch office in any city not named in its certificate of incorporation or charter as the place where its business is to be transacted. No trust company shall open a branch office without first having obtained the written approval of the superintendent of banks to the opening of such branch office, which written approval may be given or withheld in his discretion, and shall not be given by him until he has ascertained to his satisfaction that the public convenience and advantage will be promoted by the opening of such branch office; and, provided further, that no trust company in this state, or any officer or director thereof, shall open or maintain a branch office, unless the capital of such trust company actually paid in cash shall exceed the amount required by the law under which it was incorporated by the sum of one hundred thousand dollars for each branch office so opened or maintained. Every trust company and every such officer or director opening a branch office without such written approval shall forfeit to the people of the state the sum of one thousand dollars for every week during which any branch office shall be maintained without such written approval. No foreign corporation shall have or exercise in this state the power to receive deposits of trust moneys, securities and other personal property from any person or corporation, or any of the powers specified in sub-divisions one, four, five, six, seven, eight, ten and eleven of this section, nor have or maintain an office in this state for the transaction of, or transact directly or indirectly, any such or similar business.

Section 157. When any such corporation is appointed executor in any last will or testament, the court or officer authorized to grant letters testamentary in this state shall, upon the proper application, grant letters testamentary thereon to such corporation. When application is made to any court or officer having authority to grant letters of administration with the will annexed upon the estate of any deceased person, and there is no person entitled to such letters who is qualified, competent, willing and able to accept such administration, such court or officer may, at the request of any party interested in the estate, grant such letters of administration with the will annexed, to any such corporation. Any court or officer having authority to grant letters of guardianship of any infant, may, upon the same application as is required by law for the appointment of a guardian of such infant, appoint any such corporation as guardian of the estate of such infant. Any court having jurisdiction to appoint a trustee, guardian, receiver or committee of the estate of a lunatic, idiot, or habitual drunkard, or to make any fiduciary appointment, may appoint any such corporation to be such trustee, guardian, receiver or committee, or to act in any other fiduciary capacity. All moneys brought into court by order or judgment of any court of record may be deposited with any such corporation, that has been designated by the comptroller of the state of New York, as provided by the code of civil proceedure.

By amendments passed in 1898 and 1901, certain trust companies may add to the above powers those of safe deposit, title insurance and credit guaranty.

It will be seen that the powers here granted are very wide. Those fiduciary powers that are not specifically granted are conceded by the

general power to accept appointment to act in "any other fiduciary capacity," so that in the State of New York a trust company may act in any fiduciary capacity in which a natural person may act. The same broad powers are given to trust companies in most of the other States having general trust company laws, and are included in the special charters in most of the States creating such companies by special acts. The banking powers granted in New York are exceptional, however, and are granted in less than half of the other States; but by very liberal construction of the statutes trust companies frequently transact substantially a banking business in States where the statutes do not specify such powers.

Of the powers usually granted to trust companies by the State laws, some may properly be looked upon as essential or natural to a "trust" or "trustee❞ company, while others are manifestly auxiliary to its essential powers. In the former group would be included powers to act as trustee for any purpose, as executor, administrator, guardian, agent, etc. Other powers, such as banking, savings banking, safe deposit, fidelity and title insurance, etc., more or less closely allied to the business of the typical trust company, may be classed as auxiliary powers.

That the legislators have taken some such view of the case is evident from a study of the powers granted. Both in the States having general trust company laws and in those which charter trust companies by special act of the Legislature, there is practical unanimity in the granting of the powers included in the first group, while those in the second group, with the exception of safe deposit, are not so generally given.

It is beyond the scope of the present inquiry to attempt to discuss the powers impliedly given to trust companies by the various statutes, or to assemble the decisions of the courts regarding the extent of such powers. But it will be useful to compare, briefly, the powers explicitly given to these companies by the States having general trust company laws.

As already suggested, the greatest unanimity appears in the granting of powers to act as trustee, as executor and administrator, as guardian, as agent, etc.

The power to act as executor and administrator is specifically granted in all of the thirty-seven States named, except Kansas, Maine, Oregon and Wyoming. In Kansas it would seem to be impliedly granted by the wide general powers conferred. Wyoming permits the acceptance of "any trust in writing." Maine presents an interesting case. In this State trust companies may act as executor; but are expressly forbidden to act as administrator or as guardian, even if their special charters specifically grant such powers. The Oregon statutes do not enumerate

the powers of trust companies.

The power to act as guardian of minors, persons non compos mentis, etc., is specifically granted in all of the thirty-seven States named except Maine, Oregon and Wyoming. The guardianship of minors usually, and

of other persons always, applies to the estate only. In most States the power named is to act "as guardian of the estates," etc.; in some, it is the indefinite power to "act as guardian." California, Illinois, Louisiana, Massachusetts, Ohio and Tennessee specifically state that the guardianship of minors shall be of the estate only, and not of the person. On the other hand, power to act as guardian of both the estate and the person of minors is specifically given in Arkansas, Indiana, Kansas, Minnesota and Montana. In the District of Columbia, trust companies may act as guardian of the estate of a minor only with the consent of the guardian of the person. The limitation formerly specified in the New York statutes, providing that trust companies may act as guardian of the estates of minors, the income of which is one hundred dollars per annum or more, is also found in the statutes of Colorado and Georgia.

Sixteen of the States and Territories specifically grant the power to accept and execute trusts for married women with respect to their separate estates.

A power always included is that to act as trustee for various purposes. It is usually stated that the company may act as trustee for individuals, for corporations both public and private, for municipalities and States. The power to act as fiscal agent and as registrar and transfer agent is as a rule specifically given, as are also the powers to act as depositary of funds paid into court and of funds under the care of executors, administrators, guardians, etc.; to manage estates; to receive trusts from courts; to hold deposits of trust moneys; to act as receiver or assignee; to act as agent for the investment of money; to make loans on real or personal property; to deal in bonds, stocks and securities.

REGULATIONS REGARDING THE HOLDING OF REAL ESTATE.

The regulations regarding the holding of real estate by trust companies are usually somewhat more liberal than those which govern the real estate holdings of National banks, but a few States, notably Louisiana and Michigan, make provisions almost identical with those of the National Banking Act. Most of the States grant the power to hold such real estate as is necessary for the transaction of the company's business, and such as it may acquire in settlement or partial settlement of debts due to it. While the intent usually appears to be to limit the holdings much as those of National banks are limited, the language is often such as to permit of a liberal construction. As an example of statutes permitting such liberal construction, that of New Jersey reads as follows: "To lease, hold, purchase and convey any and all real estate necessary for or convenient in the transaction of its business, or which the purposes of the corporation may require, or which it shall acquire in satisfaction. or partial satisfaction of debts due the corporation under sales, judgments or mortgages, or in settlement or partial settlement of debts due the corporation by any of its debtors."

There are, however, great differences in the wording of the statutes in the different States and Territories relating to this matter, and it is not possible to form a correct idea of their purport without a separate and detailed account of the statutes in each State. Perhaps the widest powers of this kind are those of trust companies in Idaho and Pennsylvania, which, besides holding real estate that is the subject of title insurance by them, have the right "to purchase and sell real estate and take charge of the same," and in Utah, where they may "buy, sell or mortgage" real estate.

The right to hold real estate in trust for others is of course included in the trust powers given to trust companies.

AUXILIARY POWERS OF TRUST COMPANIES.

Of the powers usually looked upon as auxiliary to the main business of trust companies, that of conducting a safe-deposit business is the one which the States are most nearly unanimous in granting. Indeed, this business has come to be looked upon as being quite as essential to trust companies in the larger cities as any other function.

The fidelity insurance business is specifically permitted to trust companies in about half of the States and Territories, while in a number of others trust companies are given more or less limited powers in the way of guaranteeing bonds and acting as surety for particular purposes. West Virginia specifically prohibits trust companies from acting as surety on bonds or guarantor for individuals, firms or corporations. Connecticut prohibits trust companies from engaging in any kind of insurance business, except that certain companies already engaged in title insurance are allowed to continue.

About a third of the States grant the specific power to trust companies to conduct a title insurance business. In Pennsylvania trust companies are organized under the title insurance company law, which giants most of the trust powers.

BANKING POWERS OF TRUST COMPANIES.

In view of the great extent to which trust companies engage in the business of both savings and commercial banking, the statutory provisions regarding the transaction of such business are of special interest. But even a cursory examination of the statutes reveals the fact that the power to conduct such business usually depends more upon the implied powers and upon the interpretation of the statutes than upon powers specifically granted. One is met at the outset by the question as to what constitutes banking powers as distinguished from trust powers in the handling of funds. There is evidence that the legislators themselves were in most cases not clear as to the extent to which they were permitting the banking business. In several States, as for example Colorado and Pennsylvania, trust companies are forbidden to engage in banking

"except as herein authorized;" while they seem to be authorized to undertake several important banking functions. In Colorado specific powers are granted to receive demand deposits and to "purchase" bills of exchange, etc., and to loan on real or personal security. The same powers are held by trust companies in Pennsylvania. The power to purchase commercial paper differs only in form from the power to discount it, and not much ingenuity is required to do an actual discount business under these statutes, and such discounting in the form of purchase is widely carried on in Pennsylvania.

So far, then, as the receiving of both demand and time deposits, the discounting of commercial paper and the making of loans on real and personal security constitute a banking business, trust companies in these States may do a banking business in spite of the apparent intention to forbid such business.

Another interesting case is that of New Jersey. In this State trust companies are forbidden "to discount commercial paper;" but they have specific authority "to purchase, invest in and sell notes, bills of exchange.

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to receive deposits subject to check.

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promissory They also have specific authority

About twenty of the States and Territories appear to grant the specific power to purchase or discount commercial paper, while about the same number grant the specific power to receive both time and demand deposits. Unquestioned power to do a banking business is given in Alabama, Arkansas, Georgia, Idaho, Louisiana, Maine, Mississippi, Montana, New York, North Carolina, Oregon, Tennessee, Texas, Utah, Washington, West Virginia and Wyoming. In Ohio and Kentucky, while trust companies organized simply as such may not do banking, companies may be organized to do both kinds of business. An analogous case is that of Illinois, where banks may be given trust powers. In several other States the statutes readily permit the interpretation of granting banking powers. Indiana, Michigan, Minnesota and Wisconsin specifically prohibit banking.

The fact is that it is a very difficult task to draw a hard and fast line between banking business and business in the handling of money that is purely and simply a trust business. Indeed, banking is itself, in a sense, a trust business. If extreme instances be taken, it is of course a simple matter to say that this is a trust business, and that is a banking business. But just where to draw the line between the two classes of functions is quite a different matter. When, therefore, the legislator sets before himself the task of forbidding trust companies to do a banking business, he must solve not only the problem of how to provide for the enforcement of the statutes he may devise, but also the more intricate problem of clearly distinguishing between that which he means to authorize and that which he means to forbid. On the whole, considering the difficulty of the problem, and the industrial conditions under which trust companies have developed, it is not surprising that trust companies in