Santa Fe new Mexican. [volume] (Santa Fe, N.M.) 1898-1951, 1909-09-06

ltatlCnS, would undoubtedly be valid
without any advertising, and if sold
by negotiation with a single intend
ing purchaser; but in the absence of
some special reason for proceeding
in this way, no board of county com
missioners having the interests of the
county at heart, would proceed in
any other than the ordinary method
of advertising for bids for any such
bonds, reserving the right of course,
| to reject any bid for sufficient reasons
| would strongly urge county COM
missioners to give the utmost publicj-
ty possible to every such transaction
so that the best possible price may
be secured, and there would be no
opportunity for any imputation upon
the honesty or good faith of the
county authorities.
Yours truly,
FANK w. CLANCY,
Attorney General.
Capital Stock of Territorial Banks.
Hon. c. V. Stafford, Travelling Auditor
Santa Fe, n. NJ,
Dear Sir-I have received your let
ter of the 18th instant, asking me
to advise you what I consider your
duties in cases where territorial
banks having organized with g CAPT
tai of thirty thousand dollars, OF
which fifteen thousand were paid in
at the time of organization, have
failed to pay the other fifteen thou
sand at the end of a year. l as
sumo that this question must refer
to the provisions of section 244 OF
the Compiled Laws of 1897. That
section provides that no bank shall
transact business until at least fifty
per cent of it's capital stock shall have
been paid in in cash, with further
provision that such bank shall not
continue to transact business beyond
the period of one year unless the
capital stock of such bank shall have
been fully paid up in cash" 1t is to
be noted, however, that the act OF
which this section is part, provides
requirement With the law in that
condition, there could be no termina-
ton of the existence of the bank or
of it's power to transact business, ex-
cept upon judicial proceedings begun
by the Territory, and, naturally, no
such proceedings would ever be be-
gun as long as you could report that
the bank was solvent and safe.
There is, however, a provision in
section 254 which might be very EN-.
barrassing to the bank which had
failed to comply with this provision
as the last cited section, which makes
it unlawful for any one to carry on
the business of banking without hav-
| ing complied with the provisions OF
the act, declares that all contracts
made with bankers doing business
contrary to the act are null and void
Certainly, the attention of all such
bankers should be called to this pro.
VISION OF law.
Coming now to your duties as to
banks, they appear to be found only
in chapter SO of the Laws of 1909. BY
section of that act, it is made your
duty to take certain proceedings when
it appears to you that bank is insol-
vent, and section Z declares what
shall be deemed insolvency. Clearly
you are not called upon to take any
action as to such banks as those of
which you write under these sections
The only section which can be consid-
cred as touching the matter, SO far
as your duties are concerned, is sec
tion 8 of the same act, which author
ICES you to notify banks of which
the capital stock has been impaired
to make the impairment good within
80 0days, but this is again defective
in not fixing any penalty or punish
ment for failure on the part of the
bank to make the impairment good.
The obvious intent of the law is
that no bank shall be permitted to do
bushes swith less than thirty thou.
sand dollars of fully paid-up capital,
and the public has a right to assume
that every bank doing business for
more than one year has a full cash
capital of not less than thirty thou
sand dollars. With this in mind, it
seems clear that the failure to pay
the second half of the thirty thousand
dollars constitutes an Impairment OF
the capital of the bank, and, there
fore, it would be your duty, under
section of the Laws of 1909, to no
tify such a bank to make the impair
ment good within 900 days. 1t may
seem that this is a harsh procedure
in cases where the fifteen thousand
dollars is sufficient for all practical
purposes, but, in the face of a posi-
tive statutory provision, ministerial
executive officer has no lawful au-
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