The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1856-01-20

H., u nud
the amount Of the sbaty Of that capital 20
tain the gCvenuen. by which protected exactly to
the standard Of the aoil vi which 1t l. ma aag Cd
the talent prudence and a1egriy OF the parties sntr
cd with its coLtro or exempt from taxation Is a,c,rd-
law rae = Z e sSs MS
nns, whose property doee not form part Of corporate
franchise. The farmer cannot claim exemption from
xacn, because Of the shortness OF his crops or
neehsDic or merchant from losses IN thsr respective
business, provided their absolute capital remains unim
psiie1.
II only when capital shelters Itself under corporate
powers that II Is in measure exempted from Its s5ii.
yte support the gcvernu*n mt BY which is
this provision remain upon our statutes, IL must
cessarily lead to large reduction Of the amount Of
property liable 70 p.y It's fun proportion q tszss. The
elect u viii be to increase the amount TO be LEVIED
upon that description OF property not entitled to this
wese this rule applied to the citizens Of the State gen
ay viz that the personal property of each Individual
should furnish him with net and above all
his expenses Of Ave per cent be should b entitled to
income The smount 10 be levied collected upon per-
soDal property would become cypher IN the age
gate sum total OF property liable to DO taxed in this
The provisions Of this act being so strange AMI un
equal in its practical effects has led the Comptroller to
exsmine the journal Of both Houses Of the Legislature by
which 1t was enacted.
In the House Of Assembly but snge vote was record.
suceeeded in satisfying that body With single .x,ep-
Hon. that all corporations In reality charitable
srs
In the Senate 1t received barely sufficient votes
sary to exact IT,
tention OF the legislature was called 70 certain prov
sions IS to the method and equity Of c0lesng taxes
against cerpoIstions and y believing that certsiu
Others are excessively and unfairly taxed he copceve it
his du sgan most respectfully to recommend your
for levying and collecting taxes corporations.
his necessity exsts at the present tins with greater
sac sm The fact tu1iy established in the MIND Of the
mptxoller from his experience in this ofce) that the
oT the o. hereafter must s
should fall alike upon all capital and that sith 'ut efcr
ence 70 whether is owner had foresight. or capacity to
per cent per aDnum.
INSURANCE COMPANIES.
The duties imposed upon the Comptroller BY the gene
rs insurance law and the various amendments thereto
well the amount Of property at stake In this State
both BY the policy holders And owners cf stock in tn
what extended notice Of their condition and
The fact that large number Of those corporations,
based upon the mutual principle formed under the la
Of lS49 and situated In the interior OF the Sate have
pased into the hands OF receivers either BY the consent Of
the parties in interest or BY compulsory process issued
the insurance law 1868 10 their future ormstoo
must and will devove upon the ointsock companies the
great majority Of the business Of lnsuring the
Of the citizens of this State. The experience of the last
two th7 years must have laugh. policy hole IN
the mutual corporations (slthough the mutual principle
may been the best In the abstract that II de-
c,dedy easier to pay . premium than to collect loss
In fact with the exception Of few of the old chartered
mutual companies, who continue prosperous business
the system Of mutual insurance. far it relates TO
fire risks may be considered ended ia this State. No
attempt has been made to form . company during
causes that have produced this result, tnc Comp
troDer would only remark that It has been reached BY
entire peryertion Of those principles upon which 1t
was originally founded.
again that the great bulk insurance in this
State ril tom necessity, hereafter BE- made BY those
companies formed upon the stock principle.
Il il not supposed that the Legislature will abosh the
general law tor the formation these compAnie that
retnrn TO the system ofspecai charters will be attempt
ed by it
Uider this view Of the subject OF insurance it Is pro-
posed to examine the Of the genera law 10 the
formation and operation OF stock companies under its
present provisions.
There inherent difficulty all general laws for tbs
yesent Of capisi In personal property THIS has
betn aggravated in the general insurance from the
fact that the Of capital at all by the corporators
lends upon . contingency which may never happen II
the receipts OF the company exceed ts Disbursements
the actual capital remains unditurbed In their hands,
and 1t is upon the theory that This will be the result
rskipg the doctrine Of chances guide) that ali
companies formed whether organized BY real
fictitious capitalists No other class Of COMPOSITIONS,
formed under general laws in ths State present this pc
cuari y Their capital paced by the nature Of their
business or 1t least large portion Of 1t invested in
formed the general bank law secured beyond the
control or reach Of the corp,rators themselved.
The real Of actual ta for successful insurance
company exists only as forming basis upon which .
credit with the community may be created in which
proposes to Issue policies. It he oapiaD only comes
ton he corporation were II antic pated BY cor
porators themselves. Its existence Il not necessity
the comm transaction Of the business OF In
surance before stated but only necessary after It
is abs lutey least portion Of it. lost. should
be- and i only held IS ty the business is unsuc
enances Of the game turn against the corpOrAtors.
Tie steps necessary TO be taken In forming nsI-
the Sensra law any numosr o. not
les. than thirteen, may assemb aud form are
rarce company upon filing declaration Of their inten
be adopted by them the oce Ct the Comptroller
publishing the no,ice for six weeks in public newspaper
in the county whe the company propose to iccste
mttcd TO the Attorney General and not found incon
sstnt with he laws and constn ion Of this State he
Tbs Il certify tho same to the Comptroller. The Comp
trcl cit by himself three disnerested persons
shall csuse examination to be made to ascertain if
the amount CT required by the law has bseo paid
in and is by the company in money or such
stocks and bonds and mortgages the 18th section of the
1he usual method is to produce the certificate to the
appSers Of deposit OF the necessary amount In some
gUcd 81 solvent bsnk. In instances portion Cf 1t
Is composed Of mortgages. This is not under
accompanied with the aidavt OF officers, that the
ssne l. the bona fde property Of the corporators.
os "a Of this exhibition Ct capital to Them Ia the ce Of
the C. mptrcller II is imperative upon him to deliver
copy OF such certificates to the corp,rators and
upt filing the in TIE office of the County Clerk,
shtre the Company is to be loca ed with copy of the
cta,tr, the parties authorized to nmence the
business of IL surance.
The st conclusion resulting from this process IS that
Nc nducenent is offered to Keep the capital in the hands
Of the corpcrators. They have the certificate of the
Comptroller and sppra ers, that gives them the neces
cary credit 10 commence business. Toe commence nept
of heir business from its very nature is the receipt Of
money for premium
The second ia that actual capital being necessary
amount of money to procure the certiicses may be
rcwed upon the e5L Of tbs corIorators for single
day (nd ter that iue he their actual property
TO by their tfces and be repaid the following and
the company possess al the credit that would attach TO
zeal paid Up capital by parties who intend to form
company, and retsip its capital investment.
The third is, admitting the capital is actually pail in
witht ut sny intention Of Withdrawing it, obligation
rests upon the corporaors far their policy holders
are 'cenctInfd, TO keep the capital intact. 1t be
wholly transferred rom their CONTROL worthless mort
gsge. substitutes in the place Of the money originally
forming Its capital
The eny knowledge within the reach of the holder of
policy the annual report Of the company made 70 the
Comptroller No knowledge Of the real nature OF their