The herald., 1896-08-24
SECURITIES FOR DEPOSIT
The Title Insurance Fails
to File Any
BUT DOES BUSINESS JUST THE same
The Insurance Commissioners
Certificate Their Warrant
FOR 100000 IN SECURITIES
Assertions That These Are Not In His
Hands
And That His Certificate certlfles to What
Is Not True
Some Interesting Information Resulting Prom
the Competition Existing Between ths
Title Insurance and Trust Co. and
The Insurance Commissioners
Certificate Their Warrant
FOR 100000 IN SECURITIES
Assertions That These Are Not In His
Hands
And That His Certificate Certlfles to What
Is Not True
Some Interesting Information Resulting Prom
the Competition Existing Between ths
Title Insurance and Trust Co. and
Pacific Coast Abstract Bureau

Some one IN the olden time ventured
to remark that from a multitude of
counselors cometh forth wisdom" or
words to that effect, and in modernized
guise 1t may be taken to mean that
when an excessive competition causes
business men to ventilate their griev-
ances, either real or imaginary. then the
public at large is likely to have their
knowledge increased even If sometimes
at the expense of a faith dispelled.
Two of the abstract and title COM
panes in this city are at issue and apart
from any differences that may exist be-
tween them some interesting informa-
tion is being gained regarding the mode
followed in the conduct of the business.
The Title Insurance and Trust COM
pany is so well knwon as to be regarded
as one of the foremost institutions in
the city, while the Pacific Coast Alb
stract bureau, much younger concern,
Is regarded as in every way stable and
in certain ways, perhaps less conserva-
tive than the older institution. A PAM
phlet being circulated by the latter or
ganization has provoked much comment
for the copy of a letter is there inserted
which by implication, if not by direct
assertion. makes most serious charge
affecting the bona fides of the Title In
surance and Trust company
For proper understanding of the
matter, however it is first necessary to
know what the law requires of title in
surance companies. In the advertising
matter of the Title Insurance and Trust
company the following is given a most
prominent place:
'The Title Insurance and Trust COM
pany is the only company in Southern
California that has complied with the
title insurance law by making the nee
essary deposit of $4,000 for the protec-
tion of policy holders, and every policy
issued by this company is protected by
this large sum in addition to the other
assets of the company"
The charge is being made that in es-
sence the above advertisement is not
true and that the policy holders are not
protected in such manner as the law
requires.
THE INSURANCE LAW.
In section 427 of the civil code it is set
forth that Corporations organized sub
sequent to April l, 1878, under the laws
of this state, for the transaction of busi-
hess in any kind of insurance, may in
vest their capital and accumulations in
Ihe following named securities: Q)
In the purchase of or loans upon inter-
est bearing bonds of the United States
government. t2O In the purchase of
or loans upon interest bearing bonds of
any of the states of the United States.
not In default of interest on such bonds
(3) In the purchase of loans upon in
terest bearing bonds of any of the coun-
ties and Incorporated cities and towns of
the states of California and Oregon, not
In default of interest on such bonds
4) In loans upon unincumbered real
property. worth at least 100 per cent
more than the amount loaned; or upon
merchandise or cereals in warehouse
but in no instance shall such loan be
made in excess of IS per cent of the Sc
curity taken. O.) Corporations engaged
in the business of issuing titles to real
estate may, after the investment of $780,
600 in the manner provided for in the sub
divisions of this section, invest an
amount not exceeding so per cent of
their subscribed capital stock in the
preparation or purchase of the mater
ials or plant necessary to enable them
to engage in such business, etc"
The Title Insurance and Trust COM
pany have on exhibition in the office
the certificate of Insurance Commission
er M. r. Higgins showing that the Sc
curities of the corporations amount to
the 100000 required by law and, so far,
no claim is being put forward that this
is not so. But it is claimed that these
securities are not on deposit with the
insurance commissioner and outside the
control of the Title Insurance and Trust
company. In such case the certificate
of the insurance commissioner on it's
face certifies to what is false, for the
piece of parchment is a certificatton not
only that certain securities are on de-
posit but that they are on deposit with
the insurance commissioner as guaran-
tor to the policy holders.
THE INSURANCE COMMISSIONER
AS CUSTODIAN.
What is required in the premises is set
forth In section 595 Of the political code,
which reads as follows: 1.-The insurance
commissioner must receive all bonds
and securities of persons engaged in the
transaction of insurance business in this
state. and file and safely keep the same
IN ms oitlce, or deposit them as provided
for in this article, etc.
The later saving clause alludes to the
Following sections: Sec 61S
whenever. under any laws of this state.
any insurance company or corporation
is required to deposit with any officer
or this state securities in trust for and
for the benefit of policy holders of such
company or corporation, the Insurance
commissioner of this state must receive
from such company or corporation Sc
curities in the amount required by the
law under which such deposit is made.
on deposit and in trust for the policy
holders Of such company or corpora
ton" etc.
FAILURE TO DEPOSIT NOT DENIED
The manager of the Title Insurance
and Trust company very courteously
received representative of The Herald
and while maintaining that the law did
not require his Ampany to make any
cash deposit with the insurance COM
missioner, did not Out forward any such
claim regarding the 100000 worth of Sc
curities. He very simply and rightly, too
pointed to the certificate of the insurance
commissioner as the company's war;
rant for doing business end it's having
complied with the stipulations of the
law. Inasmuch, however, as he pro-
iessed a perfect willingness to have the
securities then and there gone over and
the certificate of the insurance commits
yioner corroborated by an Independent
investigation, 1t is only fair to assume
that the securities were not reposing In
tJ,a ekr hos - to-