Las Vegas daily optic. [volume] (Las Vegas, N.M.) 1880-1908, 1897-11-22
~lNsuRANcE LAW.
Bonds Deposited Would BE >ubjectto
Taxation-Banks May 30 elected
-. As Repositories.


From the New Mexican.
Ia response to u RI quest made by the
governor, Solicitor General Fall mas
rendered the following oplufon on the
aw requiring each insurance company
doing business In the Territory to de-
post win the treasurer Of the Terri
tory not less than $4,000, either in
cash or In bonds Of the Territory. or Of
some county or city Of New Mexico
Hon. M. A. Otero, Governor OF New Mexi.
co, Santa Ne, Now Mexico.
San,a Fe, N. NJ, NV 10, 1897
Dsar Sir:-I am 10 receipt OF your re-
quest for an ficial opini n upon Ger
tain features Of chapter 40 OF the Laws
of 1897 entitled San act requiring de-
posts Of fire insurance companies doing
business in tho Territory Of New Next
co., approved March II, 1897.
l have given the law referred to my
careful consideration and beg to say
that as to the first and principal ques-
ton submitted to me for determination,
"Would the bonds deposited by the
companies as required by the act above
referred TO, be- subject to state, county
and municipal taxationP" / am Of
the opinion that such bonds. whether
Territorial, county or municipal, would
be subject to Territorial, county and
municipal taxation at the place Of de.
posit.
A further question upon which you
have requested my official opinion is as
10 whether or not 1t would be pormis-
slble under the act of 1897 for the ter
ritorial treasurer to perfect an arrange
ment with the companies at interest by
which the bonds may be held by o res
ponsible bank satisfactory to the treas
urer and subject TO bis order, spch
bonds to be delivered to the bank at
any time on reasonable notice, as for
example, fifteen days. The purpose OF
this arrangement, suggested by certain
companies, is that it will relieve the
treasurer Of the personal custody OF
what may be a very large amount OF
bonds and at the same time give the
company the additional security Of.
forded by the services OF the bank.
There IS much reason in the suggestion
that the law OF 1897 affords but in
adequate protection to the companies
for securities proposed to be deposited.
Ii the official bond OF the treasurer be
in fact liable for the safekeeplng OF
these bonds, that bond for all purposes
being only 100000 and it being very
possible that the value OF the securities
deposited may equal or ex-
coed that amount, it is
patent that the proposition of the COM
panies above outlined is no. unreason.
able. OF course, no arrangement
should be made thatwould interfere
with the right Of the treasurer to secure
and utilize the company's bonds for the
purposes prescribed by Law, but the
only limitation imposed BY such an ar.
rangement as that above outlined would
be thai that the treasurer would be
obliged to give the bank fifteen days
notice of a desire for the securities held
by the bank, during which time the
company could be notified by the bank
of this call for its securities. The mat
ter of details 10 case such an under
standing is to be entered into, would,
| assume, be arranged by the treasurer
only after full consultation with this
Office; and for the present 1t seems
sufficient to say that l am unable to see
how the Interests of the Territory or of
the policy holders in the Territory
would be injured by such an arrange
ment ,sand l believe it would be entirely
legal and permissible.
Very respectfully,
A. b. FALL,
Solicitor General of New Mexico.