good faith according to the intent and purpose of this article of the notice required by the preceding section, the superintendent shall refuse to file such certificate until it shall be amended to conform to the provisions of this article. If such certificate is in due form and duly executed according to the provisions of this article and is accompanied by evidence satisfactory to the superintendent of the proper publication and service in good faith of such notice, he shall forthwith indorse the same over his official signature "filed for examination," with the date of such indorsement.

(Former section 102; R. S., 1564; L. 1882, ch. 409, §§ 240, 241.)

133. Examination by superintendent. -The superintendent shall thereupon ascertain from the best sources of information at his command:

1. Whether greater convenience of access to a savings bank will be afforded to any considerable number of depositors by opening a savings bank in the place designated in the certificate.

2. Whether the density of the population in the neighborhood designated for such savings bank, and in the surrounding country, affords a reasonable promise of adequate support to the enterprise.

3. Whether the responsibility, character and general fitness for the discharge of the duties appertaining to such a trust of the persons named in the certificate, are such as to command the confidence of the community in which such savings bank is proposed to be located. (Former section 103; R. S., 1564; L. 1882, ch. 409, § 242.)

§ 134. Certificate of authorization. If the superintendent shall be satisfied from his own knowledge or from information gained concerning the several matters specified in the last section, that the organization of the savings bank as proposed in such certificate will be a public benefit, he shall, within sixty days after the same has been filed by him for examination, issue under his hand and official seal the certificate of authorization required by this chapter to the persons named in such certificate, or to a portion of them, together with such other persons as a majority of those named in such certificate shall in writing approve, which shall authorize the persons named therein to open an office for the deposit of savings as designated in the certificate, subject to the provisions of this chapter. No

person shall be named in such certificate of authorization, who shall not have made and duly acknowledged the declaration prescribed in subdivisions four of section one hundred and thirty of this chapter.

The superintendent shall transmit such certificate of authorization to the county clerk of the county in which the savings bank is to be located, who shall file the same and attach it to the certificate of incorporation previously filed by him and record both certificates in the book of record of incorporations; and the superintendent shall also file a duplicate of such certificate in his own office.

If the superintendent shall not be satisfied that the establishment of a savings bank as proposed in any certificate filed by him is expedient and desirable, he shall, within sixty days after the filing thereof, give notice to the county clerk of the county in which such savings bank is proposed to be located, that he refuses to issue a certificate of authorization for such savings bank, which notice shall forthwith be filed by the county clerk with the certificate of incorporation of such savings bank.

(Former section 104; R. S., 1565; L. 1882, ch. 409, §§ 243-245.)

§ 135. When persons named in certificate become a corporation; powers. Upon the filing of any certificate of authorization of a savings bank as hereinbefore provided, the persons named therein, and their successors, shall thereupon become and be a corporation, and be vested with all the powers and charged with all the liabilities conferred and imposed by law upon savings banks; and in addition to the powers conferred by the general corporation law, every such corporation shall have power to receive on deposit any sum of money that may be offered for that purpose by any person, or by any corporation or society, and to invest the same, and to declare, credit and pay dividends thereon, and further, to transact the business of a savings bank as hereinafter provided and not otherwise. No such corporation shall receive deposits until it shall have transmitted to the superintendent of banks the name, residence and post-office address of each of the officers of such savings bank.

(Former section 105; R. S., 1563, 1565, 1557; L. 1882, ch. 409, §§ 235, 246, 247, 256.)

See General Corporation Law, §§ 11, 13, 14.

1. A savings institution and a national bank entered into an agreement, where

by all of the business of the two corporations was to be done in the same office and over the same counter, by the same individuals, the only separation being in the books of account. The institution as such received no money, but all of its funds were to be deposited in the bank, and corresponding credits were to take the place of actual payments by the bank. The business of the institution and the bank was carried on under this arrangement, the former keeping no cashdrawer or safe for the deposit of money. One C. delivered over the counter of the bank to B., who was both the treasurer of the institution and the cashier of the bank, a sum of money, which she desired deposited with the institution to her credit. B. received the money, entered it in C's pass-book, as deposited with the institution, and, as he testified, placed it in the cash-drawer of the bank; it was not entered on the bank cash book or credited to the institution, and, in some manner unexplained, it disappeared. In an action to recover, among other things, the amount of this deposit, held, that while as between C. and the institution, B. received the money as its treasurer, as between the bank and the institution at the same instant he received it as cashier, it became the money of the bank, and the bank was liable to the institution therefor; also, that this was so, although the money did not go into the cash-drawer, but was embezzled by the said cashier and treasurer B. Fishkill Savings Institute v. Bostwick, Receiver, 92 N. Y. 565.

2. The superintendent of the banking department in January, 1882, asked the opinion of the attorney-general whether a savings bank has the right to delegate its powers, and inclosed for his examination a contract which provided, that in consideration of the receiving by a certain national bank of all the deposits, and also the income and interest from all the assets belonging to a savings bank occupying adjoining rooms, the national bank agreed with the savings bankTo pay five per cent. interest per annum on deposits in said institution, to be computed and paid in accordance with the rules of said institution with its depositors.

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To pay all salaries of the clerks and officers of said institution and all rents, taxes and incidental expenses connected with the keeping of the account thereof. To pay the interest upon the surplus fund of the savings bank at the rate of five per cent. per annum, which interest shall be paid semi-annually and added to the surplus fund. The amount of the surplus fund for the purpose of computing the interest thereon is understood and agreed to be by the parties on the 1st day of July, 1876, the sum of $9,285.78, and shall hereafter be increased only by crediting to it all premiums which shall hereafter be saved on bonds and other securities, gold and gold drafts, sold or redeemed; but it was understood that all gold received for interest and premiums thereon should belong to and be the property of the national bank; said surplus fund should also be increased by crediting to it the difference between the price paid for the bonds or securities and par, when such bonds or securities should be purchased at less than par. All premiums which should hereafter be paid by said institution for bonds, stocks, mortgages or other securities, should be charged to and deducted from such surplus fund.

The national bank to pay all drafts made on it by the savings bank, either to pay depositors, or for investments.

The national bank to be responsible for the safe-keeping of the bonds or other securities, and the moneys of the savings bank.

The savings bank to bear all losses sustained on account of bad debts, depreciations and otherwise, and all expenses of litigation.

The contract to take effect on a certain day, and continue in force for the term of two years.

In the reply by the attorney-general filed in the banking department, January 11, 1882, that officer, after quoting the law regulating the management of savings banks, says:

"I think the contract amounts to an attempt to delegate the trust power of the trustees.

"The general rules applicable to trusts apply with equal force to trustees of savings banks. The law permits such institutions to exist as places of safe deposit for the accumulation of limited amounts. They are generally patronized by people of small means, and the law takes cognizance of that fact. It means, therefore, that savings banks shall be safe and secure, and in order to so provide, it has hedged them about with the provisions of law above enumerated. The law clearly points out the path to be pursued by its officers in the discharge of their trust. Being creatures of the statute, as well as trustees, the officers of such institutions are not permitted to deviate from the express rules laid down by statute for their guidance.

"The trust is personal to the trustees. They cannot lawfully delegate their trust powers. Trustees of savings banks have no authority to provide for the investment and management of money received on deposit in any other way than by themselves, or the proper officers immediately employed by them and directly accountable to them. After trustees of a savings bank have invested the moneys received on deposit, they are accountable to depositors for the actual proceeds of such investment as trustees, but not personally, if acting prudently and in good faith.

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"The trustees have no right to sell or bargain away those proceeds for a stipu lated sum. The law does not contemplate that the trustees shall, by any bargain or arrangement, subject to hazard these trust funds. On the contrary, it has pointed out the course which must be pursued by them strictly, and whether a contract of this nature might be more advantageous to the depositors than for the trustees to obey the strict letter of the law, is not to be considered. Trustees are not permitted in any manner to speculate with these trust funds.

"If the facts in this case should reveal that the stockholders of the national bank are the same persons who are the trustees of the savings institution, then clearly such an arrangement as is set forth in this contract, whereby the trustees should seek, under the guise of a contract between the savings bank and the national bank, to make money for themselves out of the deposits of the savings bank, would render the contract clearly illegal.

"Any arrangement, therefore, by which they should seek, directly or indirectly, to make money for themselves out of the deposits, and thereby deprive the depositors of the surplus which might accrue if they carried out strictly the provisions of the act, would be illegal.

"I do not think the mere contract by a savings bank with a discount bank to have the clerical work of the savings bank done by such discount bank, would be illegal or a violation of the provisions of the Savings Bank Act, but if an

arrangement is made by which a delegation of power to exercise judgment or discretion is conferred it would be illegal."

3. In August, 1886, the author submitted the following questions to the attorney-general:

First: May the board of trustees of the institution lawfully pay to the personal representatives of a deceased president, or other officer, the unearned salary for the remainder of the term for which he was elected?

Second. May the salary be paid to the personal representatives up to the close of the leave of absence granted to a president, or other officer now deceased?

In reply thereto the attorney-general in an opinion filed in the banking department, August 25, 1886, held as follows:

"To both of these questions I am constrained to return a negative answer, for the following reasons:

"Savings banks are vested with certain well-defined powers, principal among which are the rights to contract and be contracted with; to receive money on deposit and invest the same; to act as banks for savings; and generally to exercise any corporate powers necessary to the exercise of the main powers. Section 235, ch. 409, Laws of 1882. Further than this they may not go. They do not possess, nor can they exercise, any corporate powers, except such as are necessary to the exercise of their main powers. 1 R. S. 600, § 3. While they may pay salaries to their officers and employees, they cannot make gratuities to them."

4. An opinion by the attorney-general was filed in the banking department June 12, 1878. In reply to a communication inquiring whether a depositor in a savings bank is liable to be assessed and taxed for his deposit, that officer says: "In my opinion, section 4 of chapter 456 of the Laws of 1857 exempts such deposits absolutely from taxation, and a depositor cannot, therefore, be assessed for such moneys. The law above mentioned, in my opinion, protects the individual depositor as well as the bank."

5. The authorities of the Poughkeepsie Savings Bank applied to the supreme court for a writ of certiorari to review their assessments, and Mr. Justice BARNARD's opinion was filed September 1, 1879. It is as follows:

"The deposits in savings banks are not taxable. Under the Revised Statutes moneyed corporations were taxable upon their capital. Savings banks have no capital; they simply receive deposits, for which they become liable to the depositor with accrued interest. The design was to afford institutions which would receive deposits generally in small amounts, and to invest the same so that the depositors would have an income from their earnings. There was nothing upon which to base taxation. The savings banks were debtors for the entire sums in their hands. Ordinarily the depositors would have been taxable, but the legis lature by chapter 456, Laws of 1857, ordered that these deposits should not be taxable.

"By chapter 761, Laws of 1867, section 7, it was provided that the privileges and franchises of savings banks should be deemed personal property, and liable to taxation, to an amount not exceeding the gross sum of the surplus earned.' It is under this law that this assessment seems to have been imposed. If the tax was imposed upon the savings bank under the Revised Statutes, the bank would have been liable for the entire deposit, less its real estate. If this was the correct view, then there was no need of the statute taxing the franchise so far