against the bank, but not as between the creditors themselves. If the assets at time of receiver taking charge were sufficient for payment of principal indebtedness, interest should be allowed at legal rate before distribution of surplus to stockholders. Various adjustments of interest reviewed. People v. Merchants' Trust Co., 187 N. Y. 293.

5. The compensation of temporary receivers in insolvency proceedings against a trust company discussed and reviewed as to special facts and circumstances, and certain allowances held to be excessive. The practice as to fixing allowances stated. People v. Knickerbocker Trust Co., 127 App. Div. 215.

6. To justify appointment of a receiver the facts requiring such action must be proved by legal evidence and not by verified complaint alone. People v. Oriental Bank, 124 App. Div. 741.

7. Closing of a bank and calling upon superintendent to take charge are acts of insolvency, but not conclusive, when such action is shown to be unnecessary and there are sufficient assets to make a large surplus. People v. Oriental Bank, 124 App. Div. 741.

8. Notice of application for a receiver should not be dispensed with when the assets are in possession of the superintendent. Notice should be dispensed with only when the funds are in jeopardy or immediate action is necessary. People v. Oriental Bank, 124 App. Div. 741.

9. The opinions of the superintendent and attorney-general that further business by a bank is unsafe and inexpedient, are not sufficient to justify judgment dissolving the corporation. People v. Oriental Bank, 124 App. Div. 741.

10. The closing of a bank and placing it in charge of the superintendent does not work a surrender of the bank's corporate franchise until expiration of the statutory period. It may resume before that period expires. People v. Oriental Bank, 124 App. Div. 741.

11. Where 90 per cent. of the bank's depositors unite in an application to resume business, and neither the superintendent nor attorney-general oppose, and a fair appraisal shows that a surplus of assets of $250,000, over a capital of $200,000, the bank is entitled to an order for resumption of business. People v. Hamilton Bank, 57 Misc. 345.

12. The sufficiency of evidence tending to prove insolvency of bank and liability for deposits received with knowledge of insolvency examined. Money deposited under such circumstances cannot be recovered from the bank unless it passed into the assignee's hands. Williams v. Van Norden Trust Co., 104 App. Div. 251.

§ 36. Merger. Any two or more corporations, other than savings banks organized under any one article of this chapter, or organized under the laws of this state for the purposes, or either of them, mentioned in any one article of this chapter, are hereby authorized to merge one or more of said corporations into another in the manner following: The respective boards of directors of such corporations may enter into and make an agreement, under their respective corporate seals, for the merger of one or more of said corporations into another of them, prescribing the terms and conditions thereof and

the mode of carrying the same into effect, which agreement shall be subject to the approval of the superintendent of banks, and may provide that such corporation upon and after such merger shall have the name of any one of the corporations merged, to be specified in said agreement, and may name the persons, not less than thirteen nor more than twenty-four, who shall constitute the board of directors of such corporation after its merger, or may provide for a meeting of stockholders within sixty days after the merger to elect a board of directors with such temporary provision for conducting the affairs of the corporation meanwhile as shall be agreed upon; and said directors so named or elected, after qualifying shall divide themselves into classes in manner and with effect as provided in section one hundred and ninety-five of this chapter and may adopt new by-laws for said corporation.

(Former section 34; L. 1895, ch. 382; L. 1900, ch. 199.)

See Stock Corporation Law, §§ 15-17.

1. As to right of corporations in general to consolidate, see editorial note to Wood v. Seattle, 52 L. R. A. 369, presenting in full the authorities on that question. 2. Where trust companies have been created by special acts, and are amenable to such parts of the banking law as are not inconsistent with the special acts, and later are authorized by special acts to execute trusts, such companies may merge, although such was originally unlawful under the special acts; and such merger is authorized under sections 36 to 40 of the banking law. Colby v. Equitable Trust Co., 124 App. Div. 262.

3. Sections 36 to 40 (former sections 34-38) held to be constitutional and within Const., art. 8, § 1. Colby v. Equitable Trust Co., 192 N. Y. 535.

§ 37. Submission of merger agreement to stockholders. Such agreement shall be submitted to the stockholders of each of such corporations at a meeting thereof to be called upon notice of at least two weeks, specifying the time, place and object thereof, addressed to each stockholder at his last known post-office address and deposited in the post-office, postage prepaid, and published for at least two successive weeks in one of the newspapers in each of the counties of this state in which either of such corporations shall have its principal place of business, and if such agreement shall be approved at each of such meetings of the respective stockholders separately by the vote orballot of the stockholders owning at least two-thirds of the stock, the same shall be the agreement of such corporations. A sworn copy of the proceedings of such meetings, made by the secretaries thereof,

respectively, shall be presumptive evidence of the holding and action of such meetings. Such agreement and verified copy of proceedings of such meetings shall be made in duplicate and filed in the office of the superintendent of banks and in the office of the clerk of the county in which the principal place of business of the corporation into which such corporation or corporations shall be merged is located, and thereupon such corporations shall be merged as specified in such agreement, and the corporation into which the other or others are merged, shall thereafter have the new name, if any, specified in such agreement pursuant to the provisions of section thirty-six of this chapter, and the provisions of such agreement shall be carried into effect as therein provided; and it shall be lawful for said corporation into which the others shall have been merged to require the return of the original certificate of stock held by each stockholder in each or either of the companies, and in lieu thereof to issue new certificates for such number of shares of its own stock as under the agreement of merger the said stockholder may be entitled to receive.

(Former section 35; L. 1900, ch. 199.)

§ 38. Rights of dissenting stockholders. -If any stockholder not voting in favor of such agreement of merger shall, at such meeting or within twenty days thereafter, object to such merger and demand payment for his stock, or, in the case of co-operative savings and loan associations, if such stockholder be a borrower, liquidation of his indebtedness and cancellation of his stock, such stockholder, if the merger takes effect at any time thereafter may, at any time within sixty days after such merger, apply to the supreme court at any special term thereof held in the district in which the county is situated in which such corporation into which the other or others may be merged may have its principal place of business, upon at least eight days' notice to said corporation, for the appointment of three persons to appraise the value of his stock, or the amount of said indebtedness, if any, and the court shall appoint such appraisers and designate the time and place of their first meeting, with such directions in regard to their proceedings as shall be deemed proper, and also direct the time and manner in which payment of such stock to such stockholder or liquidation of such indebtedness by him and cancellation of his stock shall be made. The court may fill any

vacancies in the board of appraisers occurring by refusal or neglect to hold such office. The appraisers shall meet at the time and place designated and after being duly sworn shall honestly and faithfully discharge their duties and estimate and certify the value of such stock, and the amount of such indebtedness, if any, at the time of such decision, and deliver one copy to such corporation and another to such stockholder if demanded; the charges and expenses of the appraisers shall be paid by the corporation. When the corporation shall have paid the appraised value of such stock, or if such stockholder be a borrower as aforesaid, when he shall have paid the amount of his indebtedness as fixed by such appraisal, as directed by the court, said stock shall be canceled and such stockholder shall cease to be a member of said corporation or to have any interest in such stock and in the corporate property, and such stock may be held and disposed of by the corporation for its own benefit; and if such stockholder be a borrower as aforesaid proper instruments of acquittance shall be duly executed and delivered to him by the corporation and thereupon he shall be discharged from all further liability to the corporation.

(Former section 36.)

1. The stockholder not voting for a merger who can move for appraisal must be a stockholder of record, the equitable ownership of the stock will not suffice. Matter of Rogers, 102 App. Div. 466.

2. Where a merger is effected, an assignment of a guaranty to one of the banks merged is not necessary. Bank of Long Island v. Young, 101 App. Div. 88.

39. Effect of merger. Upon the merger of any corporation in the manner herein provided all and singular the rights, franchises and interests of the said corporation so merged in and to every species of property, real, personal and mixed, and things in action. thereunto belonging shall be deemed to be transferred to and vested in such corporation into which it has been merged, without any other deed or transfer, and said last named corporation shall hold and enjoy the same and all rights of property, franchises and interests in the same manner and to the same extent as if the said corporation so merged should have continued to retain the title and transact the business of such corporation; and the title and real estate acquired by the said corporation so merged shall not be deemed to revert by means of such merger or anything relating thereto.

(Former section 37.)

§ 40. Rights of creditors and others having relations with merged corporations. The rights of creditors of any corporation that shall be so merged shall not in any manner be impaired by any such merger, nor shall any liability or obligation for the payment of any money due or to become due, or any claim or demand, in any manner or for any cause existing against such corporation, or against any stockholder thereof, be in any manner released or impaired, and all the rights, obligations and relations of all the parties, creditors, depositors, trustees and beneficiaries of trusts shall remain unimpaired by the merger, but such corporation into which the other or others shall be merged shall succeed to all such relations, obligations, trusts and liabilties and be held liable to pay and discharge all such debts and liabilities, and to perform all such trusts of the merged corporation in the same manner as if such corporation into which the other shall become merged had itself incurred the obligation or liability or assumed the relation or trust, and the stockholders of the respective corporations so entering into such agreement shall continue subject to all the liabilities, claims and demands existing against them as such at or before such merger, and no suit, action or other proceeding then pending before any court or tribunal in which any corporation that may be merged is a party shall be deemed to have abated or discontinued by reason of any such merger, but the same may be prosecuted to final judgment in the same manner as if the said corporation had not entered into the said agreement, or the said last named corporation may be substituted in the place of any corporation. so merged as aforesaid, by order of the court in which such action, suit or proceeding may be pending.

(Former section 38; L. 1900, ch. 199.)

§ 41. Communications from banking department. Each official communication directed by the banking department to a bank, savings bank, or trust company, pertaining to an investigation or examination conducted by the department, or to the affairs of such bank, savings bank or trust company, or containing suggestions or recommendations as to the conduct of the business thereof, shall be submitted, by the officer receiving it, to the board of directors or trustees of such bank, savings bank or trust company, at the next meeting of such board.

(Former section 39.)