entitled "An act to provide for a presiding circuit judge and for the manner of his selection, to prescribe his powers and duties, and to defray the expenses incident thereto," being section fourteen thousand five hundred forty-seven of the compiled laws of nineteen hundred fifteen, are hereby amended to read as follows: TITLE An Act to provide for a presiding circuit judge and for the manner of his selection, to prescribe his powers and duties, to relieve congestion in the courts of this state, and to defray the expenses incident thereto. powers. SEC. 2. The presiding circuit judge shall have full di- Presiding circuit judge, rectory power over the matter of apportioning the work of the several circuits among the circuit judges of the state. Upon the request of the governor he shall designate one or more judges to hold court in the various circuit courts and recorder's courts of this state whenever necessary to relieve congested conditions in said courts. Approved May 7, 1927. [No. 121.] AN ACT to amend sections one, two, three, four, five, six, seven, eight, nine, ten, eleven, twelve, fourteen and fifteen of act number three hundred seven of the public acts of nineteen hundred twenty-five, entitled "An act to define, license and regulate finance companies; to dispose of the assets of such companies in certain cases; and to prescribe penalties for violation of this act," approved May twentysix, nineteen hundred twenty-five. The People of the State of Michigan enact: amended. SECTION 1. Sections one, two, three, four, five, six, seven, Sections eight, nine, ten, eleven, twelve, fourteen and fifteen of act number three hundred seven of the public acts of nineteen hundred twenty-five, entitled "An act to define, license and regulate finance companies; to dispose of the assets of such companies in certain cases; and to prescribe penalties for violation of this act," are hereby amended to read as follows: SEC. 1. The term "finance company" as used in this act, "Finance, means any corporation or association, formed under the laws defined. of this state or any other state or country, or any association formed under a declaration of trust; and whose principal business in this state is the buying, selling or dealing in bonds or notes secured by deeds of trust, mortgages, land contracts or other securities on real property; or buying, selling or company" Proviso. Further proviso. Certificate of authority. Application and statement. What to contain. dealing in stocks, bonds, securities or any other personal property of a like character or any interest therein; or pledg ing, guaranteeing or underwriting shares of stock, bonds, securities or any other evidences of indebtedness created by any other corporation or association; or buying, selling or dealing in promissory notes, trade acceptances, bills of lading, debentures, and other commercial papers and evidences of indebtedness: Provided, however, This act shall not apply to any person, corporation, partnership or association, doing business under the laws of this or any other state or of the United States relating to banks, trust companies, building and loan associations, licensed pawnbrokers, nor persons, partnerships or corporations holding licenses under act number three hundred six of the public acts of nineteen hundred nineteen or act number three hundred seventeen of the public acts of nineteen hundred twenty-one, and who do no business as above defined except that for which such licenses are issued, nor shall it apply to private banks so-called, nor shall this act apply to any corporation or association organized under the laws of this or any other state or country, nor to any association formed under a declaration of trust, which has neither offered for sale nor sold any of its capital stock nor any securities in this state, nor to any person, firm or partnership engaged solely in buying, selling, discounting or dealing in land contracts: Provided further, That nothing herein contained shall be construed as amending or superseding any of the provisions of act number eighty-four of the public acts of nineteen hundred twenty-one, or act number eighty-five of the public acts of nineteen hundred twenty-one. SEC. 2. On and after January first, nineteen hundred twenty-six, it shall be unlawful for any finance company to engage in or continue in business described in section one, until it shall have procured from the state treasurer a certificate of authority for that purpose. To procure such certificate of authority every such finance company shall by its president, secretary, treasurer and general manager, or any two of them, make an application and statement duly sworn to, in such form as the state treasurer may prescribe, containing the following facts: First. The location of its principal office and its principal place of business in this state and the names and addresses of the officers and agents in charge thereof and the names and addresses of the directors of said company; Second. The total value of the property owned and used by the company in its business in this state, giving its location and general character and stating separately the value of its tangible property, its real and personal property and its credits; Third. The total amount owing by said company, secured and unsecured; Fourth. The amount of its capital stock authorized and issued; Fifth. Such other facts bearing on the matter as the state treasurer may require, including a statement of the particular business in which the company is engaged or desires to transact. tificate SEC. 3. When such company has fully complied with the when cerprovisions of this act and the application filed shows such issued. company to be solvent, the state treasurer shall issue to such company a certificate of authority to carry on such business in this state so long as said company complies with this act and all other laws of this state, and the rules and regulations of the state treasurer. tion of act. tion, etc. SEC. 4. The administration of this act is hereby vested in Administrathe state treasurer, and for that purpose he is hereby empowered to make and enforce such reasonable rules and regulations as shall be appropriate under this act, giving notice of the same to every finance company doing business in this state. At any time after this act becomes effective, the state Annual treasurer, or any examiner appointed by him, may personally examinavisit any finance company in this state and thoroughly inspect and examine its affairs and ascertain its financial condition and determine if it has complied with law. Such examination and inspection shall be made of every such company licensed hereunder at least once in each calendar year. Each company so examined and inspected shall pay to the state treasurer for such examination and inspection the sum of ten dollars per day for each examiner so employed and the actual expenses incurred. The state treasurer or person making Access to the examination shall have free access to all the books and books. papers of such finance company relating to its business or kept or used by its agents, and may administer oath to and examine as witnesses the directors, officers and agents of said company, and any other person, relative to its affairs, transactions and condition: Provided, That the state treasurer Proviso. may accept a report and audit of the affairs of any concern coming under the provisions of this act when made by a certified public accountant in lieu of the examination herein provided for. SEC. 5. Every finance company holding a certificate of Semi-annual authority under this act shall file with the state treasurer a report filed. semi-annual report giving a full and detailed statement of its true financial condition at the close of business on June thirtieth and December thirty-first of each year. Such re- When filed. ports shall be filed within thirty days following the above dates, and shall set forth the amount and character of its assets, liabilities, receipts and disbursements, and shall contain such other information, and be in such form as the state treasurer may prescribe, and shall be subscribed and sworn to by the secretary and treasurer or by any two directors of said company. Such reports shall be examined and audited by the state treasurer, or examiners appointed by him, and if such report shows said company to have complied with the laws of this state and the rules and regulations of the When disapproved. Failure to make report. Dividends, how paid. Appraisal, when may cause to be made. Accounts charged off. state treasurer, then the same shall be approved and notice of approval given such company. If such report is not approved, the state treasurer shall advise said company of that fact and his reasons for disapproval, upon which said company shall have sixty days in which to restore its affairs to a safe and sound condition or to discontinue its illegal practices and comply with the order made by the state treasurer. If such company shall not comply with the order of the state treasurer so made, proceedings shall be taken by the state treasurer, as hereinafter provided. Any company failing to make and file with the state treasurer any of the reports required by this act shall be subject to a penalty of one hundred dollars per day for each day after the time mentioned for making such reports, which may be collected by the state treasurer in an action brought in his name in any court having jurisdiction and all moneys so collected shall be paid into the general fund of the state treasury. SEC. 6. Dividends shall be paid only from the actual earnings, profits or surplus of any finance company, and in computing earnings, profits and surplus, no discounts shall be considered unless the same are actually earned; nor shall there be considered as earnings, profits or surplus, any sum equal to the difference between the cost price and the selling price of shares of stock of said company purchased and held by said company; nor shall there be considered as earnings, profits or surplus, any sum equal to the difference between the cost of any property real or personal owned by said company and the amount at which it is carried on its books if at an increase over its cost, except when approved by the state treasurer. No dividends shall be authorized or paid until a reserve fund shall be created by the board of directors to cover all expenses of organization and a reasonable amount of obsolescence which shall be amortized over a period of not more than ten years and a proper proportion thereof deducted from earnings, profits and surplus annually. SEC. 7. If at any time the state treasurer shall consider that any property owned by any finance company is carried on the books of said company at a sum in excess of the true cash value thereof, he may cause an appraisal of such property to be made and the value so found shall, upon the order of the state treasurer, be set as the sum at which said property shall be carried on the books of the company for the purposes of this act. For the purpose of making such appraisals the state treasurer may employ professional appraisers, real estate boards, bank appraisal committees, or any other persons capable of making true and fair appraisals. All necessary expense occasioned thereby shall be paid by the company or companies whose property is appraised. SEC. 8. If at any time the state treasurer shall determine that any account or debt due any finance company is worthless or uncollectible, he may order the same charged off and such sums so ordered charged off shall not thereafter be carried as an asset upon the books of said company, except by the consent of the state treasurer. stock SEC. 9. Every finance company authorized to do business Report to under this act shall issue to each of its stockholders of record holders. on June thirtieth and December thirty-first, a report of its affairs and conditions as of said dates on a form to be prescribed by the state treasurer, and within ten days after the semi-annual reports for said dates have been approved. No person shall cause to be printed or published in any way any statement with regard to the assets, liabilities, earnings or losses of any finance company which are false or calculated to deceive. erty. SEC. 10. No officer or director of any finance company Officers, etc., shall sell to or buy from said company any property, real or etc., comnot to buy, personal of any nature whatsoever, or any interest therein, pany propnor shall any officer or director sell to or buy from any subsidiary finance company or holding company of the finance company of which any such person is an officer or director, except by the consent of the state treasurer, nor shall any such officer or director borrow money from or enter into any contract creating a fixed or contingent liability to said company as a principal, guarantor or indemnifier, except such loan or contract be secured by ample collateral and the same authorized by the board of directors. deemed given. SEC. 11. Whenever it shall appear to the state treasurer When upon examination or from the reports of any finance com- unsound. pany that such company is in an unsound or unsafe financial condition to transact the business for which it is authorized, so that it is unsafe and inexpedient to continue same, or that its officers or agents refuse to submit to examination or perform any legal obligation under this act, the state treasurer Notice shall cause a notice to be served on the president or secretary of such company showing such facts, and that a failure to do or perform anything required by law or by the order of the state treasurer under this act as set forth in said notice within a period of thirty days from the service of such notice, will result in a revocation of the certificate of authority theretofore granted. If at the end of said thirty day period May revoke said company shall not have complied with the notice so given, the state treasurer may immediately cancel and revoke the certificate of authority, and no business shall thereafter be done by it while such disability continues nor until its certificate of authority is restored by the state treasurer, except as hereinafter provided. He shall forthwith notify the company of such revocation and shall specify in the notice the cause thereof: Provided, however, That if said Proviso. finance company shall within the said thirty day period request a hearing before the state treasurer upon the facts set forth in said notice, it shall be granted and no notice of revocation shall be issued by the state treasurer until after such hearing. The state treasurer may at any time, after giving the thirty day notice as aforesaid, designate a com certificate of authority. |