tion of said company; and whenever the auditor shall deem it best for the interest of the public so to do, he shall publish the result of such investigation in one or more papers of this state; and whenever it shall appear to the said auditor from such examination, that the assets and funds of any company incorporated in this state, are reduced or impaired by the liabilities of said company, as described under the head of liabilities in the statement required by this act, more than twenty per cent. below the paid up capital stock required by this act, may direct the officers thereof to require the stock holders to pay in the amount of such deficiency within such a period as he may designate in such requisition; or he shall communicate the fact to the attorney of state, whose duty it shall then become to apply to the district court, or, if in vacation, to one of the judges thereof for an order requiring said company to show cause why their business should not be closed; and the court or judge, as the case may be, shall thereupon proceed to hear the allegations and proofs of the respective parties; and in case it shall appear to the satisfaction of said court or judge, that the assets and funds of said company are not sufficient as aforesaid, or that the interest of the public require it, the said court or judge shall decree a dissolution of said company, and a distribution of its effects; the said court or judge shall have the power to refer the application of the attorney of state to a referee, to inquire into and report upon the facts stated herein.

SEC. 29. [Same-Deficiency.]-Any company receiving the aforesaid requisition from the said auditor, shall forthwith call upon its stockholders for such amounts as will make its paid up capital equal to the amount filed by this act, or the charter of said company; and in case any stockholder shall refuse or neglect to pay the amount so called for, after notice personally given, or by advertisement, in such time and manner as said auditor shall approve, it shall be lawful for the said company to require the return of the original certificate of stock held by such stockholder, and in lieu thereof, to issue new certificates for such number of shares as such stockholders may be entitled to, in the proportion that the ascertained value of the funds of the said company may be found to bear to the original capital of the said company, the value of such shares for which new certificate shall be issued to be ascertained under the direction of the said auditor, the company paying for the fractional parts of shares. And it shall be lawful for the directors of such company to create new stock, and dispose of the same, and to issue new certificates therefor, to an amount sufficient to make up the original capital of the company; and in the event of any additional losses, accruing upon new risks taken upon expiration of the period limited by the auditor, in the aforesaid requisition for the filling up of the deficiency in the capital of such company, and before said deficency shall have been made up, the directors shall be individually liable to the extent thereof.

SEC. 30. [Same-Mutual companies.]-If, upon such examination, it shall appear to the said auditor that the assets of any company chartered upon the plan of mutual insurance under this act, are insufficient to justify the continuance of such company in business, it shall be his duty to proceed in relation to such company, in the same manner as is herein required in regard to jointstock companies; and the trustees or directors of such company are hereby made personally liable for any losses which may be sustained upon risks taken after the expiration of the period limited by the said auditor for filling up the deficiency in the capital, and before such deficiency shall have been made up; any transfer of the stock of any company organized under this act, made during the pending of any investigation required above, shall not release the party making the transfer from his liability for losses which may have accrued previous to such transfer

SEC. 31. [Same-Certificate revoked.]-The auditor of state shall be authorized to examine into the condition and affairs of any insurance company, as provided for in this act, doing business in this state, not organized under the laws of this state, or cause such examination to be made by some person or persons appointed by him, having no interest in any insurance company; and when

ever it shall appear to the satisfaction of said auditor that the affairs of any such company are in an unsound condition, he shall revoke the certificate granted in behalf of such company, and shall cause the notification thereof to be published in some newspaper in general circulation, published at the state capital; and the agent or agents of such company are, after such notice, requested to discontinue the issuing of any new policies, or the renewal of any previously issued.

SEC. 32. [Same-Fees.]-There shall be paid by every company, association, person or persons, agent or agents, to whom this act shall apply, the following fees: For examination and filing of the first application of any company, and issuing of the certificate of license thereon, fifty dollars, which shall go to the auditor; for filing each annual statement herein required, twenty dollars; for each certificate of authority, two dollars; for every copy of paper filed as herein provided the sum of ten cents per folio, and fifty cents for certifying the same and affixing the seal of office thereto; all of which fees shall be paid to the officer required to perform the duties.

SEC. 33. [Security deposits.]-Whenever the existing or future laws of any other state of the United States shall require of insurance companies incorporated by or organized under the laws of this state, having agencies in such other state, or of the agents thereof, any deposit of securities in such state, for the protection of policy-holders, or otherwise, or any payment for taxes, fines, penalties, certificates of authority, license fees, or otherwise, greater than the amount required for such purposes, from similar companies of other states, by the then existing laws of this state, then, and in every such case, all companies of states establishing, or having therefore established an agency or agencies in this state, shall be and are hereby required to make the same deposit, for a like purpose, with the auditor of this state, and to pay said auditor, for taxes, fines, penalties, certificates of authority, license fees, or otherwise, an amount equal to the amount of such charges and payments imposed upon or required by the laws of such state, of the companies of this state, or the agents thereof.

SEC. 34. [Certificate published.]-It shall be the duty of every insurance company of the kind provided in this act, doing business in this state, organized under the laws of this state or any other state or country, to publish once, annually, in two newspapers of general circulation, one of which newspapers shall be published at the capital of the state, (and in case of companies organized in the state of Nebraska, one of which shall be published in the county where the principal office is located), a certificate from the auditor of state that such company has in all respects complied with the laws of this state relating to insurance.

SEC. 35. [Examination-Expenses.]-The necessary expenditures of any examination made or ordered to be made by the auditor of the state, under this act, shall be certified to by him and paid on his requisition by the company which is the subject of such examination; Provided, That the auditor of state shall have the power, upon receiving information that the capital of any company is impaired, to call upon any such company for a full statement of its condition, and in event of refusal or neglect of any company to answer the requisition of the auditor as aforesaid, he shall proceed to make the examination required by this act, and to take the necessary action to terminate the business of said company in this state. SEC. 36. [Examination-Blanks.]-It shall be the duty of the auditor of state to cause to be prepared and furnished to each of the companies organized under the laws of this state, and to attorneys or agents of companies incorporated by other states and foreign governments, who may apply for the same, printed forms of statements required by this act, and he may from time to time make such changes in the form of these statements as shall seem to him best adapted to elicit from the companies a true exhibit of their condition in respect to the several points herein before enumerated.

SEC. 37. [Auditor's report.]-It shall be the duty of the auditor of state to cause the information contained in the statements required of the companies

organized in this state, to be arranged in tabular form, and prepare the same in a single document for printing, and submit the same to the legislature, as a portion of his regular report to that body.

SEC. 38. [Repealed. See sec. 38, chap. 77.]

SEC. 39. [Mixed mutual and stock companies.]—It shall not be lawful for any company organized upon the mutual plan, to do business and take risks upon the stock plan, neither for a company organized as a stock company, to do business upon the plan of a mutual insurance company.

SEC. 40. [Unincorporated mutual companies.]-Nothing in this act shall be so construed as to prevent any number of persons, not exceeding two hundred, from making mutual pledges and giving valid obligations to each other for their own insurance from loss by fire or death; but such association of persons shall in no case insure any property not owned and occupied by one of their number, and no life, except that of their own number; nor shall the provisions of this act be applicable to such associations or companies; Provided, Such associa tions or companies shall in no case pay any salaries or compensations to officers, agents, or any other employees, and shall receive no premiums, nor make any dividends.

SEC. 41. [Acts repealed.]—That portion of chapter twenty-five, of the Revision of 1866, which relates to insurance companies, and all acts and parts of acts amendatory and supplementary thereto, are hereby repealed, except so far as the same relates to the business of life insurance companies; and the auditor of state is authorized to return the deposits made under section. twelve, chapter twenty-five, of the Revision of 1866, when the companies making the same have complied with this act; Provided, such deposits shall not be needed for the payment of losses due from the company having made the same.

CHAPTER 44.-INTEREST.*

SECTION 1. [Rate.]-Any rate of interest which may be agreed upon, not exceeding ten dollars per year upon one hundred dollars shall be valid upon any loan or forbearance of money, goods, or things in action; which rate of interest so agreed upon may be taken yearly, or for any shorter period, or in advanee, if so expressly agreed. [1879 § 1, 113.]

SEC. 2. [Unagreed rates.]-Interest upon the loan or forbearance of money goods, or things in action, shall be at the rate of seven dollars per year upon one hundred dollars, unless a greater rate, not exceeding ten per cent. per annum, be contracted for by the parties.

SEC. 3. [Judgments Decrees.-Interest on all decrees and judgments for the payment of money, shall be from the date of the rendition thereof, at the rate of seven dollars upon each one hundred dollars annually, until the same shall be paid; Provided, That if said judgment or decree shall be founded upon any con tract, either verbal or written, by the terms of which a greater rate of interest, not exceeding the amount allowed by law, than seven per centum shall have been agreed upon, the rate of interest upon such judgment or decree shall be the same as provided for by the terms of the contract upon which the same was founded.

SEC. 4. [Other cases.]-On money due on any instrument in writing, or on settlement of the account from the day the balance shall be agreed upon, on money received to the use of another, and retained without the owner's consent express or implied, from the receipt thereof, and on money loaned or due, and withheld by unreasonable delay of payment, interest shall be allowed at the rate of seven per cent. per annum. Unsettled accounts between parties shall bear interest after six months from the date of the last item thereof.

SEC. 41. See chapter entitled "Corporations," ante, page 130.

*NOTE. "An act to amend Chap. 34, General Statutes (being chapter XXVIII of the Revised Statutes of 1866) entitled Interest . Laws 1879, 113. Took effect June 1, 1879.

SEC. 1. Partial payments, how applied. 4 Neb. 193. 7. Id. 83.

SEC. 4. Interest on money refunded by creditor to purchaser at an execution sale, subsequently set aside, is not made as a statutory right but as damages sustained by being deprived of use of the money. 10 Neb. 137.

323

SEC. 5. (Usury-Consequences-Agents.-If a greater rate of interest than is hereinbefore allowed shall be contracted for or received, or reserved, the contract shall not, therefore, be void; but if in any action on such contract, proof be made that illegal interest has been directly or indirectly contracted for, or taken, or reserved, the plaintiff shall only recover the principal, without interest, and the defendant shall recover costs; and if interest shall have been paid thereon, judgment shall be for the principal, deducting interest paid; Provided, The acts and dealings of an agent in loaning money shall bind the principal, and in all cases where there is illegal interest by the transaction of the agent, the principal will be held thereby as if he nad done the same in person. Where the same person acts as agent for the borrower who obtains the money from the lender, he shall be deemed to be the agent of the loaner also.

SEC. 6. [Usurers-Witnesses.]-Any person charged with taking illegal interest may be required to answer touching the same, on oath, in any civil proceeding.

SEC. 7. [Tender.]-Relief to a complain[an]t in case of an usurious loan, may be given without payment or tender by him of the principal sum.

SEC. 8. [Witnesses-Perjury.]-Any officer or agent of a person or a corporation, whether interested or not, may be summoned as witness in any action for usury against such person or corporation, and required to disclose all the facts of the case, but the testimony of such witness, or the answer of a party as required in section 6, shall not be used against such witness or party in any criminal prosecution for perjury.

SEC. 9. [Yearly rates.]-When in any law, or in any instrument in writing specifying a rate of interest, no period of time is mentioned for which such rate is to be calculated, it shall be deemed to be by the year.

SEC. 10. [Warrants-Bonds.]-All warrants issued by the proper author. ities of the state, county, city, town, or other municipal subdivision less than a county, shall draw interest from and after the date of their presentation for payment, at the rate of seven per cent. per annum, and all bonds issued by any county, city, township, precinct, or school district, shall not draw interest at a rate exceeding eight per cent. per annum.

SEC. 11. [Educational lands-Delinquent taxes.]—The rate of interest fixed by this chapter shall not affect interest on purchase money of school, university, and agricultural college lands, or on lands delinquent or sold for the non-payment of taxes.

SEC. 12. [Repealed original chapter.]

SEC. 5. An agreement for a loan was made in New York, and money advanced there. Note was dated in Nebraska, payable in New York. It was void under New York usury laws, Held, there could be no recovery here. 1 Neb. 108. The lender of money at a lawful rate of interest cannot be charged with usury when without his knowledge or consent, the agent of the borrower applies for and negotiates a loan, and receives from the borrower a sum of money, which the borrower previously agreed to pay him, if he would secure the loan. 3 Neb. 259. But if a person employ another as his agent to loan money and puts funds in his hands for that purpose, if the agent charge unlawful interest, or receives a bonus for such loan, the transaction is usurious 5 Neb. 264. And if such agent takes from the borrower a note and mortgage for the payment of a bonus or commission the transaction is usurious, and there can be no recovery. 6 Neb. 154. Whether the proviso to the above section making the agent of the borrower the agent of the loaner, overrules these decisions, quære? A note drawing legal interest is not affected with usury by an indorsement or agreement of the maker, made after maturity, wherein he promises to pay a greater rate of interest than that allowed by law. In such case money paid in excess of lawful interest constitutes a payment pro tanto of the principal. 4 Neb. 205. 9 Neb 455. Where one is intrusted with the business of loaning money, and exacts for its use, either directly or indirectly by whatsoever shift or device, interest in excess of the rate allowed by law, such transaction is usurious. 4 Neb. 206. 6 Neb. 154. 8 Neb. 426. 7 Neb. 58. 7 Neb. 58. Upon the expiration of a stay of execution, extension of time was granted defendant upon payment to the plantiff's attorney with plaintiff's assent, of an attorney's fee in addition to interest. Held, usury. 8 Neb A surety on a note may plead usury as a defense 50. A, being the owner on an undivided interest in real estate, conveyed his interest to F, for the agreed price of $350, for which he gave his note secured by a mortgage on the premises. In anticipation of this trade, A arranged with the plaintiff to sell him the note and security for $275. To save the trouble of transferring the note and security, A requested F to make them directly to the plaintiff, which was done. Held, not usurious, the evidence showing it to be a bona fide purchase of security, and not a contrivance to evade the usury laws. 9 Neb. 15. Under this section a bona fide purchaser before maturity and without notice, takes the note free from the defense of usury; and where usury in the original transaction is proved, the burden of proof is on the plaintiff, to show the bona fides of his holding; but it is not sufficient for him to show payment of value, he must show good faith. A statement that he did not know or have reason to believe there would be a contest over it, is not sufficient to show good faith. 9 Neb. 229. 10 Neb. 86. To constitute usury there must be contract between the lender and borrower, by which the lender receives or reserves a greater rate of interest than the maximum allowed by law. 10 Neb. 543.

CHAPTER 45.-INTERNAL IMPROVEMENTS.

SECTION 1. [Bonds.]-That any county or city in the state of Nebraska is hereby authorized to issue bonds to aid in the construction of any railroad, or other work of internal improvement, to an amount to be determined by the county commissioners of such county or the city council of such city, not exceeding ten per centum of the assessed valuation of all taxable property in said county or city; Provided, The county commissioners, or city council, shall first submit the question of the issuing of such bonds, to a vote of the legal voters of said county or city, in the manner provided by chapter nine of the Revised Statutes of the state of Nebraska, for submitting to the people of a county, the question of borrowing money. [1869 § 1, 92. G. S. 448.]

SEC. 2. [Proposition to vote.]-The proposition of the question must be accompanied by a provision to levy a tax annually for the payment of the interest on said bonds as it becomes due; Provided, That an additional amount shall be levied and collected to pay the principal of said bonds, when it shall become due; and, Provided, further, That no tax shall be levied or collected to pay any of the principal of said bonds until after the year 1880. [Amended 1870, 15.]

SEC. 3. [Rate of interest.]-The proposition shall state the rate of interest such bond shall draw, and when the principal and interest shall be made payable. SEC. 4. [Result of vote.]—If two-thirds of the votes cast at any such election for the purposes herein set forth, be in favor of the propositions submitted, the county commissioners in the case of a county, and the city council, in the case of a city, shall cause the proposition and result of the vote to be entered upon the records of said county or city, and a notice of its adoption to be published for two successive weeks in any newspaper in said county or city, if there be one, and shall thereupon issue said bonds which shall be and continue a subsisting debt against such county or city, until they are paid and discharged. [Amended taking effect Dec. 1, 1875. Laws 1875, 87.]

SEC. 5. [Taxes.]-It shall be the duty of the proper officers of such county or city to cause to be annually levied, collected and paid to the holders of such bonds a special tax on all taxable property within said county or city, sufficient to pay the annual interest as the same becomes due; and when the principal of said bonds become due, such officers shall in like manner collect an additional amount sufficient to pay the same as it becomes due; Provided, That when any bonds have been heretofore issued, such officers shall not levy or collect any amount more than may be necessary to pay the amount annually falling due by the condition of such bonds until after the year 1880; Provided, That not more than 10 per centum of the principal of said bonds shall be collected in any one year, excepting where bonds have been heretofore issued, and by the conditions of such bonds are required to be paid in some other manner. [Amended 1870, 15.]

SEC. 6. Estoppel.]-Any county or city which shall have issued its bonds,

NOTH.-"An act to enable counties, cities, and precincts to borrow money on their bonds, or to issue bonds to aid in the construction or completion of works of internal improvement in this state, and to legalize bonds already issued for such purpose." Laws 1869, 92. G. S. 448. Took effect Feb. 15, 1869. NOTE, also, that "an act authorizing precincts, townships and towns to vote bonds to aid in works of internal improvement," printed on p. 116, laws of 1879 contains no enacting clause as required by sec. 10, Art. III, Const. and is omitted from this volume. Provisions concerning registration of bonds ante p. 69.

DECISIONS. The act is constitutional. 2 Neb. 377. 7 Id. 313. 10 Id. 279. The issuance of street bonds in cities of the second class is not governed by this act. 7 Neb. 273. A public bridge across the Platte river is a work of internal improvement for which bonds may be issued. 4 Neb. 456. 7 Id. 260. Where the question of issuing bonds to any railroad company was submitted to a vote without accompanying the same with a proposition to levy a tax to meet the liability incurred, held that bonds issued in pursuance of such vote were void. 6 Neb. 235. But the proposition need not contain provisions for levy of a tax to pay the principal, but only the interest. 6 Neb. 53. Where the vote authorized the commissioners to subscribe for stock in a railroad company, held, no authority for a donation of such bonds. 6 Neb. 235. The indebtedness authorized by this act cannot exceed ten per cent. of the assessed value of taxable property in the county, and this must be authorized by a two-thirds vote as provided in sec. 4. 7 Neb. 313. When a county votes aid in excess of the limit, the commissioners have no authority to issue bonds to any amount. Id. In an application for a mandamus to compel payment of bonds issued to aid in the construction of works of internal improvement, there should be a particular description of the works so the court can see by an inspection of the petition alone, that they are really of that character. 9 Neb. 459. The building of a county court house is not a work of internal improvement under these acts. 10 Neb. 280.

SEC. 4. The original section provided for the issuance of the bonds "upon a majority of the votes cast being in favor of the proposition submitted." G. S. 448.