in any court of competent jurisdiction; and it is hereby made the duty of the secretary of state, as he may be advised that corporations are doing business in contravention of sections four hundred and eight and four hundred and nine of this code, to report the fact to the governor, who shall instruct the district attorney of the county wherein such corporation has its principal place of business, or the attorney general of the state, or both, as soon as practicable, to institute proceedings to recover the fine provided for in this section, and the amount so recovered must be paid into the state treasury to the credit of the general fund of the state; in addition to which penalty, no foreign corporation which shall fail to comply with sections four hundred and eight and four hundred and nine of this code can maintain any suit or action in any of the courts of this state until it has complied with said sections; provided, that any such corporation which, prior to the 8th day of March, 1901, shall have complied with the provisions of the act entitled "An act to amend 'An act in relation to foreign corporations,' approved April 1, 1872," approved March 17, 1899, is exempted from the provisions of this section and the two sections next preceding. Enacted March 21, 1905; stats. 1905, p. 631. 153 Cal. 535, 536. NOTE. See note to § 408. Foreign insurance corporations: See, also, Pol. C. § 616. CHAP. I. TITLE II. Insurance Corporations. General provisions. §§ 414-421. II. Fire and marine insurance corporations. §§ 424-432. IV. V. VI. tions. §§ 437-452. Mutual benefit and life associations. 88 452a-453. property and human life To discover fire and save endowment §§ 453d-453p. CHAPTER I. GENERAL PROVISIONS. See, also, Pol. C. § 588 et seq., and "Insurance," statutes at large, Appendix. SEC. 414. Subscriptions to capital stock opened, and how col- 415. Purchase and conveyance of real estate. 416. 418. 419. 420. 421. Directors liable for loss on insurance in certain cases. Capital to be at least two hundred thousand dollars. [Repealed.] Exception, capital of one hundred thousand dollars. [Repealed.] Investment of capital. [Repealed.] 421. Capital and accumulations, how invested. Subscriptions to capital stock opened, and how collected. § 414. After the secretary of state issues the certificate of incorporation, as provided in article one, chapter one, title one, of this part, the directors named in the articles of incorporation must proceed in the manner specified, or in their by-laws, or if none, then in such manner as they may by order adopt, to open books of subscription to the capital stock then unsubscribed, and to secure subscriptions to the full amount of the fixed capital; to levy assessments and installments thereon, and to collect the same, as in chapter two of title one provided. Enacted March 21, 1872. Purchase and conveyance of real estate. § 415. No insurance corporation may purchase, hold or convey real estate, except as hereinafter set forth, to wit: 1. The building in which it has its principal office and the land upon which it stands. 2. Also, such as may be requisite for its accommodation in the convenient transaction of its business. 3. Also, such as may be conveyed to it, or to any person for it, by way of mortgage, or in trust or otherwise, to secure or provide for the payment of loans previously contracted or for moneys due. 4. Also, such as may be purchased at sales upon deeds of trust, or judgments obtained or made for such loans or debts. 5. Also, such as may be conveyed to it in satisfaction of debts previously contracted in the course of its dealings. All such real estate, mentioned in subdivisions three, four and five, so acquired, which is not requisite for the accommodation of such corporation in the transaction of its business, must be sold and disposed of within five years after such corporation acquired title to the same. Amended February 24, 1905; stats. 1905, p. 21. Policies, how issued and by whom signed. § 416. All policies made by insurance corporations must be subscribed by the president or vice-president, or in case of the death, absence, or disability of those officers, by any two of the directors, and countersigned by the secretary of the corporation. All such policies are as binding and obligatory upon the corporation as if executed over the corporate seal. Enacted March 21, 1872. Dividends, of what, and when declared. $ 417. The directors of every insurance corporation, at such times as their by-laws provide, must make, declare, and pay to the stockholders dividends of so much of the net profits of the corporate business and interest on capital invested as to them appears advisable; but the moneys received and notes taken for premium on risks which are undetermined and outstanding at the time of making the dividend must not be treated as profits, nor divided, except as provided in chapter two of this title. Enacted March 21, 1872. Directors liable for loss on insurance in certain cases. § 418. If any insurance corporation is under liabilities for losses to an amount equal to its capital stock, and the president or directors, after knowing the same, make any new or further insurance, the estates of all who make such insurance, or assent thereto, are severally and jointly liable for the amount of any loss which takes place under such insurance. Enacted March 21, 1872. Capital to be at least two hundred thousand dollars. [Repealed.] § 419. Capital to be at least two hundred thousand dollars. [Repealed March 8, 1907; stats. 1907, p. 141.] Exception, capital of one hundred thousand dollars. [Repealed.] § 420. Exception, capital of one hundred thousand dollars. [Repealed March 8, 1907; stats. 1907, p. 141.] § 421. Investment of capital. [Repealed March 18, 1907; stats. 1907, p. 597.] NOTE. § 421. There being two sections 421, referring to the same subject, one approved March 3, 1905, and the other approved March 21, 1905, the former was repealed and the latter left intact. Capital and accumulations, how invested. § 421. Companies organized under the laws of this state for the transaction of business in any kind of insurance, may invest their capital and accumulations in the following named securities: 1. In the purchase of, or loans upon interest-bearing bonds of the United States government. 2. In the purchase of, or leans upon interest-bearing bonds of any of the states of the United States, not in default for interest on such bonds. 3. In the purchase of, or loans upon interest-bearing bonds of any of the counties and incorporated cities and towns and duly organized school districts of any state or territory of the United States not in default for interest on such bonds. 4. In loans upon unincumbered real property, no loan to exceed sixty per cent of the market value of any piece of real estate to be taken as security. 5. Corporations engaged in the business of insuring titles to real estate may, after the investment of one hundred thousand dollars in the manner provided for in subdivisions one, two, three and four of this section, invest an amount not exceeding fifty per cent of their subscribed capital stock, in the preparation or purchase of the materials or plant necessary to enable them to engage in such business; and such material or plant shall be deemed an asset valued at the actual cost thereof, in all statements and proceedings required by law for the ascertainment and determination of the condition of such corporations. 6. Companies organized for and engaged in the business of fire, life, health, accident and marine insurance, may, after the investment of two hundred thousand dollars, and companies duly formed or organized for the transaction of business in any other kind of insurance may, after the investment of one hundred thousand dollars, in the manner provided in subdivisions one, two, three and four of this section, invest the balance of their capital and any accumulations in the purchase of or loans upon the stock of any corporation (except mining companies) organized and carrying on business under the laws of the State of California which have at the time of investment a market value of not less than their paid-in value, and which are rated as firstclass securities, or in interest-bearing bonds of any corporation of any state or territory of the United States not in default of interest; provided, that a two-thirds vote of all the directors of such corporations shall approve such investment. It shall be the duty of the officers of such corporation to report quarterly during the months of January, April, July and October of each year to the insurance commissioner a list of such investments so made by them, and the insurance commissioner may, if such investments, or any of them, seem injudicious to him, require the sale of the same. But no investment in the securities named in subdivisions one, two, three and six of this section must be made in an amount exceeding the market value of such securities, at the date of such investment. 7. Life insurance companies may loan upon their own policies; provided, that the amount so loaned upon each policy shall not exceed the reserve against said policy at the time said loan is made; provided further, that no policy loans whatever shall ever be used as security which may be deposited with the insurance commissioner under section six hundred and thirty-four of the Political Code; and provided further, that whenever any such loan in any amount is made on a policy registered with the insurance commissioner under said section six hundred and thirty-four of the Political Code, such registration shall be forthwith canceled. Amended March 22, 1907; stats. 1907, p. 890. |