Section
117
A banking corporation, in addition to the
general powers incident to corporations as set forth in this Act, shall have
all such incidental powers as shall be necessary to carry on the banking, by
discounting and negotiating promissory notes, drafts, bills of exchange, and
other evidences of debt, by receiving deposits; by buying and selling exchange,
coin, and bullion; and by loaning money on personal security; but it shall make
no loans upon real-estate security; PROVIDED, HOWEVER, That savings and mortgage
banks may make loans on the security of real estate as hereinbefore prescribed;
AND PROVIDED FURTHER, That the banking corporations engaged in the business of
making loans secured by real estate, in accordance with their charters and the
laws under which they were organized before the passage of this Act, may
continue to make such loans on real estates as prescribed by such charters and
laws.
Section
118
Banking corporations, other than savings
and mortgage bank, shall not be permitted to file their articles of
incorporation with the Chief of the Division of Archives, Patents, Copyrights,
and Trade-Marks of the Executive Bureau, or to receive his certificate of
incorporation unless such articles show, under oath of the incorporators, that
the capital stock of such corporation is not less than two hundred thousand
pesos, that fifty per centum of the whole stock has been actually subscribed,
and that fifty per centum of the subscription has been actually paid into the
treasury of the corporation.
Section
119
The total liabilities to a banking
corporation of any person, or of any company, corporation, or firm, for money
borrowed, including in the liabilities of the company or firm the liabilities
of the several members thereof, shall at no time exceed fifteen per centum of
the surplus and capital stock of such bank actually paid in. But the discount
of bills of exchange drawn in good faith against actually existing values and
the discount of commercial or business paper actually owned by the person negotiating
the same not be considered as money borrowed.
Section
120
No bank organized under this Act shall make
any loan or discount on the security of the shares of its own capital stock,
nor be the purchaser or holder of any such shares, unless such security or
purchase shall be necessary to prevent loss upon a debt previously contracted
in good faith, and stock so purchased or acquired shall, within six months from
the time of its purchase, be sold or disposed of at public or private sale, or,
in default thereof, a receiver may be appointed to close up the business of the
bank in accordance with law.
Section
121
No such bank shall at any time be indebted
or in any way liable to an amount exceeding the amount of its capital stock at
such time actually paid in and remaining undiminished by losses or otherwise,
except on account of demands of the following nature:
(1) Moneys deposited with or
collected by the bank;
(2) Bills of exchange or
drafts drawn against money actually on deposit to the credit of the bank or due
thereto;
(3) Liabilities to the
stockholders of the bank for dividends and reserve profits;
Section
122
Such bank may purchase, hold, and convey
real estate for the following purposes and no other;
(1) Such as shall be
necessary for its immediate accommodation in the transaction of its business;
(2) Such as shall be
mortgaged to it in good faith by way of security for debts previously
contracted;
(3) Such as shall be
conveyed to it in satisfaction of debts previously contracted in the course of
its dealing;
(4) Such as it shall
purchase at sales under judgments, decrees, mortgages, or trust deeds held by
the bank or shall purchase to secure debts due to it.
But no bank shall hold the possession of
any real estate under mortgage or trust deeds or the title and possession of
any real estate purchased to secure any debts due to it for a longer period
than five years.
Section
123
No such bank shall loan money to any
director or officer thereof, unless such loan shall previously have been
approved in writing by a majority of the directors thereof and such approval
shall have been entered upon the records of the bank.
Section
124
If losses have at any time been sustained
by any such bank equal to or exceeding the undivided profits in hand, no
dividend shall be made; and no dividend shall ever be made by any such bank
while it continues in banking operations, to an amount greater than its net
profits then on hand, deducting therefrom its losses and bad debts. All debts
due to any bank, on which interest is past due and unpaid for a period of six
months, unless the same are well secured and in process of collection, shall be
considered bad debts within the meaning of this section.
Section
125
Every such bank shall at all times have on
hand, in lawful money of the Philippine Islands or of the United States, an
amount equal to at least twenty per centum of the aggregate amount of its
deposits in all respects. The term "lawful money of the Philippine
Islands" shall include silver certificates issued under authority of Act
Numbered Nine hundred and thirty-eight, ordinarily called the "Gold
Standard Act," and gold certificates should the issue thereof be
authorized for the Philippine Islands by the Congress of the United States, and
the term "lawful money of the United States" shall include gold and
silver certificates of the United States and bank notes issued by national banks
in the United States: PROVIDED, HOWEVER, That in case of a bank having branches
as provided in section one hundred and twenty-eight of this Act the provision
for a twenty per centum reserve shall be deemed to be complied with if the
principal bank and its branches in the aggregate have on hand twenty per centum
in lawful money of the aggregate amount of the deposits in the principal bank
and all of its branches.
Section
126
Whenever the lawful money as defined in the
last preceding section of any bank shall be below the amount of twenty per
centum of its deposits, such bank shall not diminish the amount of such lawful
money by making any new loans or discounts, nor make any dividend of its
profits until the required proportion between the aggregate amount of its deposits
and its lawful money has been restored. In case of the violation of this
provision the business of the bank may be wound up by the appointment of a
receiver or in the manner provided by Act Numbered Five hundred and fifty-six.
Section
127
Each such bank, before the declaration of a
dividend, shall carry ten per centum of its net profits accruing since the last
preceding dividend to a surplus fund until the same shall amount to twenty per
centum of its authorized capital stock; and no part of the surplus fund shall
at any time be paid out in dividends, but losses accruing in the course of
business of the bank may be paid from the surplus fund. Nothing herein
contained shall prevent the accumulation of a larger surplus fund should the
directors so determine.
Section
128
It shall be lawful for any such bank having
its head office in the city of Manila, and having a paid-up capital of not less
than one million pesos, to establish a branch or branches in any municipality
or municipalities in the Philippine Islands, and to conduct its authorized
banking business in the city of Manila and in such branch or branches; but the
corporation shall be responsible for all the business conducted in its branch
or branches had all been conducted in the principal institutions at Manila. In
the case of the establishment of a branch, or branches, the business shall be
treated as an entirety.
Section
129
Any director or officer of any banking
corporation who receives or permits or causes to be received in said bank any
deposit or who pays out or permits or causes to be paid out of any funds of
said bank or who transfers or permits or causes to be transferred any
securities or property of said bank after said bank becomes insolvent shall be
punished by a fine of not less than one thousand nor more than ten thousand
pesos and by imprisonment for not less than two or more than ten years.
Section
130
Any banking corporation when advertising
the amount of its capital stock shall in the advertisement state the specific
amount of such capital which has actually been paid in cash.
Section
131
Any corporation formed or organized for the
purpose of acting as trustees or administering any trust or holding property in
trust or on deposit for the use, benefit, or behoof of others shall be known as
a trust corporation.
Section
132
No trust corporation shall be permitted to
file articles of incorporation with the Chief of the Division of Archives,
Patents, Copyrights, and Trade-Marks of the Executive Bureau or to receive his
certificate of incorporation unless such articles show under oath of the
incorporators that the capital stock of such corporation is not less than one
million pesos, that fifty per centum of the whole stock has been actually
subscribed, and that fifty per centum of the subscription has been actually
paid in cash into the treasury of the corporation.
Section
133
At least four hundred thousand pesos of the
capital stock of any such corporation must be paid in cash into the treasury
within one year after filing the articles of incorporation, and for a failure
to cause such amount of its capital stock to be paid into the treasury within
the time limited, such corporation shall not be permitted to transact any new
business other than that required for the administration of the business
already undertaken by it. Any officer, official, director, or trustee of the
corporation authorizing or transacting any business in violation of this
section shall be punished by imprisonment for not less than one year nor more
than five years and by a fine of not less than one thousand nor more than five
thousand pesos.
Section
134
After filing its articles of incorporation
and the issuance to it of the certificate of incorporation by the Chief of the
Division of Archives, Patents, Copyrights, and Trade-Marks of the Executive
Bureau, any trust corporation, in addition to the powers conferred by general
corporation laws, shall have power
(1) To act as trustee on any
mortgage or bond issued by any municipality, body politic, or corporation, and
to accept and execute any other municipal or corporate trust not inconsistent
with law;
(2) To act under the order
or appointment of any court of record as guardian, receiver, trustee, or
depositary of the estate of any minor, insane person, idiot, habitual drunkard,
or other incompetent or irresponsible person, and as receiver and depositary of
any moneys paid into court by parties to any legal proceedings and of property
of any kind which may be brought under the jurisdiction of the court by proper
legal proceedings;
(3) To act as the executor
of any last will or testament when it is named in the last will and testament
as the executor thereof;
(4) To act under appointment
of a court of competent jurisdiction as administrator of the estate of any
deceased person, with the will annexed, or as administrator of the estate of
any deceased person when there is no will and when in either case there is no
person qualified, competent, willing, able, and entitled to accept such
administration;
(5) To accept and execute
any legal trust confided to it by any court of record or by any person or
corporation for the holding, management, and administration of any estate, real
or personal, and the rents, issues, and profits thereof;
(6) To accept deposits of
money or other personal property and to allow to the depositors of money such
interest thereon as may be provided by the by-laws.
Section
135
No bond or other security shall be required
from any such trust corporation for the faithful performance of its duties as
trustee, executor, administrator, guardian, receiver, or depositary: PROVIDED,
HOWEVER, That the court or officer appointing such corporation as trustee,
executor, administrator, guardian, receiver, or depositary may, upon proper
application showing special cause therefor, require any corporation which shall
seek to be or shall have been so appointed to give adequate security for the
protection of the funds or property confided to the corporation, and upon
failure of the corporation to give the security required its appointment as
trustee, executor, administrator, guardian, receiver, or depositary shall be
revoked.
The court shall require the corporation to
make all reports, render all accounts, perform such duties, and to do such acts
as might be required by the court of a natural person acting as trustee,
executor, administrator, guardian, receiver, or depositary.
Section
136
Upon the application of any executor,
administrator, guardian, receiver, trustee, or depositary or any other person
in interest, any court having jurisdiction of such officer, trustee, receiver,
or depositary and of the subject-matter of the trust or deposit may, upon such
notice to the parties in interest as the court shall direct and after hearing
the application and all parties in interest desiring to be heard, order said
officer, trustee, receiver, or depositary to deposit with some trust
corporation lawfully doing business in the Philippine Islands the whole or any
part of the moneys or personal property held by such officer, trustee,
receiver, or depositary. Upon presentation to the court of the receipt or
written acknowledgment of the trust corporation that the deposit of said moneys
and personal property has been made in accordance with the order of the court,
the court may order that the bond given or required to be given by such
officer, trustee, receiver, or depositary for the faithful performance of his
duties be reduced to such sum as the court may seem proper: PROVIDED, HOWEVER,
That the reduced bond shall be sufficient to adequately secure the proper
administration and care of any property remaining in the hands or under the
control of such officer, trustee, receiver, or depositary and the proper
accounting for such property. Property deposited with any trust corporation in
conformity with this section shall be held by said corporation under the orders
and directions of the court.
Section
137
The accounts of all moneys, properties, or
securities received by any trust corporations as executor of the will of any
deceased person or as administrator, with or without the will annexed, of the
estate of any deceased person, or as guardian, receiver, trustee, or depositary
of the estate of any minor, insane person, idiot, habitual drunkard, or other
incompetent or irresponsible person, or as receiver or depositary under and by
virtue of any order or appointment of any court, shall be kept separate and
distinct from the accounts of its general business.
Section
138
No trust corporation shall have the right
to accept any trust whatever which it would be unlawful for any individual to
make, accept, or execute, and it shall be the duty of a trust corporation,
acting as trustee of any legal trust, to execute such trust in accordance with
the lawful terms of the trust.
Section
139
Deposits or moneys received by any trust
corporation as executor of the will of any deceased person or as administrator,
with or without the will annexed, or as guardian, receiver, trustee, or
depositary of the estate of any minor, insane person, idiot, habitual drunkard,
or other incompetent or irresponsible person, or as receiver or depositary
under and by virtue of any order or appointment of any court, or as trustee
under any instrument in writing constituting the corporation a trustee, unless
otherwise directed by the instrument creating the trust, can be loaned only on
unencumbered improved real estate in cities and centers of population of
municipalities in the Philippine Islands or on actually cultivated agricultural
lands in the Philippine Islands to an amount not exceeding forty per centum of
the value of the real estate, or on railroad bonds guaranteed by the Philippine
Insular Government or on first mortgages transferred to the corporation as
collateral security on improved and otherwise unencumbered real estate in
cities and centers of population of municipalities in the Philippine Islands:
PROVIDED, That such first mortgages with interest accrued shall not exceed in
value forty per centum of the value of the mortgaged property or on the
security of gold or silver bullion; PROVIDED, That the amount loaned shall not
exceed ninety per centum of the value of the bullion pledged or on the security
of United States Government bonds or on the security of bonds of the Philippine
Government or of the city of Manila or of any municipality authorized by law to
issue bonds. No loan of such deposits on the security of real estate shall be
made unless the title to such real estate shall have been first registered in
accordance with the Land Registration Act. Any officer or director authorizing
or making any loan on security otherwise than as provided in this section shall
be punished by imprisonment not exceeding ten years and by a fine of not less
than one thousand nor more than five thousand pesos.
Section
140
The capital stock and funds of the
corporation other than those mentioned in section one hundred and thirty-nine
may be loaned or otherwise invested as the by-laws may prescribe and the
directors authorize.
Section
141
The capital stock of any trust corporation
shall be security for the faithful performance of all the trust duties of the
corporation: PROVIDED, HOWEVER, That claims against such corporation as
executor of the will of any deceased person or as administrator, with or
without the will annexed, of any deceased person, or as guardian, receiver,
trustee, or depositary of the estate of any minor, insane person, idiot,
habitual drunkard, or other incompetent or irresponsible person, or as receiver
or depositary under and by virtue of an order or appointment of any court,
shall have priority over all the other claims.
Section
142
Five per centum of the net profits of every
trust corporation shall be set apart as a reserve fund, which shall be loaned
or invested as prescribed in section one hundred and thirty-nine, and the
earnings of the reserve funds shall constitute a part of the reserve. The
reserve fund shall be used solely for the purpose of meeting the losses
sustained in the lawful transaction of its business; PROVIDED, That the
corporation may provide in its by-laws for the disposal of any excess of the
reserve fund over twenty per centum of its liabilities, inclusive of stock, and
for the final disposal thereof on the dissolution of the corporation after the
payment of all liabilities.
Section
143
No loan shall be made by any trust
corporation, directly or indirectly, to any director or officer thereof, except
by written approval of the majority of the directors.
Any officer or director of a trust corporation
authorizing, receiving, or making any such loan without the authority
prescribed shall be punished by imprisonment for not less than five years nor
more than ten years and by a fine of not less than two thousand nor more than
twenty thousand pesos.
Section
144
Any director or officer of any trust
corporation who receives for said corporation or permits or causes to be
received by said corporation any deposit, or who pays out or permits or causes
to be paid out of any funds of said corporation or who transfers or permits or
causes to be transferred any securities or property of said corporation after
said corporation becomes insolvent, shall be punished by a fine of not less
than one thousand nor more than ten thousand pesos and by imprisonment of not
less than two nor more than ten years.
Section
145
The ordinary business of any trust
corporation shall be transacted at the place of business specified in its
articles of incorporation.
Section
146
Savings banks, commercial banks, banks or
issue and discount, trust corporations, and banking institutions of every kind
shall be subject to all the provisions of Act Numbered Fifty-two, entitled
"An Act providing for examinations of banking institutions in the
Philippine Islands, and for reports by either officers," as amended by Act
Numbered Five hundred and fifty-six.
Section
147
Corporations formed or organized to save
any person or persons or other corporation harmless form loss, damage, or
liability arising from any unknown or future or contingent event, or to
indemnify or to compensate any person or persons or other corporation for any
such loss, damage, or liability, or to guarantee the contractual obligations or
debts of others, shall be known as insurance corporations for the purposes of this
Act.
Section
148
No insurance corporation shall be permitted
to file articles of incorporation with the Chief of the Division of Archives,
Patents, Copyrights, and Trade-Marks of the Executive Bureau or to receive his
certificate of incorporation unless such articles show, under oath of the
incorporators, that the capital stock of such corporation is not less than five
hundred thousand pesos, that fifty per centum of the whole stock has been
actually subscribed, and that fifty per centum of the subscription has been
actually paid in cash into the treasury of the corporation.
The whole subscribed capital stock of any
fire or fire and marine insurance corporation must be fully paid up in cash
within one year after filing its articles of incorporation, and for a failure
to have its subscribed capital stock paid up within the time prescribed the
corporation shall not be permitted to take any new risks or any kind or
character.
Any officer, official, or director of the
corporation taking or authorizing the taking of any risk for the corporation in
violation of the terms of this section shall be punished by imprisonment for
not less than one year nor more than five years and by a fine of not less than
one thousand nor more than five thousand pesos.
Section
149
No insurance corporation shall loan any of
its money or deposits except upon the security of unencumbered improved real
estate in cities and centers of population of municipalities in the Philippine
Islands, or on actually cultivated real estate in the Philippine Islands when
the value of such real estate is at least one hundred per centum more than the
amount to be loaned, or upon the security or first mortgages on real estate not
otherwise encumbered transferred to it as collateral security when the value of
the real estate described in the mortgage is one hundred per centum more than
the amount of the mortgage with interest accrued, or upon bonds or other
evidence of debt of the Government of the United States or of the Philippine
Islands or of the city of Manila or of municipalities in the Philippine Islands
authorized by law to issue bonds: PROVIDED, HOWEVER, That a life insurance
corporation may loan its money upon the security of a policy to an amount not
exceeding the cash value of the policy.
Section
150
No loan by any insurance corporation on the
security of real estate shall be made unless the title to such real estate
shall have been first registered in accordance with the Land Registration Act.
Section
151
Insurance corporations may purchase, hold,
own, and convey real and personal property as follows:
(1) The lot with the
building thereon in which the corporation conducts and carries on its business,
which shall not exceed in value one hundred thousand pesos, or such additional sum
as may be fixed by the affirmative vote of the stockholders representing
two-thirds of the subscribed capital stock;
(2) Such property, real and
personal, as may have been mortgaged, pledged, or conveyed to it in good faith
in trust for its benefit by reason of money loaned by it in pursuance of the
regular business of the corporation, and such real or personal property as may
have been purchased by it at sales under pledges, mortgages, or deeds of trust
for its benefit on account of money loaned by it, and such real and personal
property as may have been conveyed to it by borrowers in satisfaction and
discharge of loans made by the corporation to them: PROVIDED, HOWEVER, That any
real estate purchased by said corporation in payment or by reason of any loan
made by said corporation shall be sold by the corporation within five years
after the title thereto has been vested in it;
(3) Bonds and other
evidences of debt of the Government of the United States or of the Philippine
Islands or of the city of Manila or of any municipality in the Philippine
Islands authorized by law to issue bonds, at the reasonable market value
thereof, and such other securities as may be approved by the Secretary of
Finance and Justice.
Section
152
No insurance corporation shall declare any
dividend except from the profits of the transaction of the corporate business,
and then only after retaining unimpaired the entire subscribed capital stock, a
sum sufficient to pay all expenses incurred by the corporation, inclusive of
taxes, and a sum sufficient to pay all losses reported or in the course of
settlement.
Section
153
No fire or marine insurance corporation
shall insure on any one risk to an amount more than one-tenth of its capital
stock paid in and intact at the time of taking the risk without reinsuring the
excess.
Section
154
For the administration of the temporalities
of any religious denomination, society, or church, and the management of the
estates and properties thereof, it shall be lawful for the bishop, chief priest,
or presiding elder of any such religious denomination, society, or church to
become a corporation sole unless inconsistent with the rules, regulations, or
discipline of his religious denomination, society, or church or forbidden by
competent authority thereof.
Section
155
In order to become a corporation sole, the
bishop, chief priest, or presiding elder of any religious denomination,
society, or church must file with the Chief of the Division of Archives,
Patents, Copyrights, and Trade-Marks of the Executive Bureau articles of
incorporation setting forth the following facts:
(1) That he is the bishop,
chief priest, or presiding elder of his religious denomination, society, or
church and that he desires to become a corporation sole;
(2) That the rules,
regulations, and discipline of his religious denomination, society, or church
are not inconsistent with his becoming a corporation sole and do not forbid it;
(3) That as such bishop,
chief priest, or presiding elder he is charged with the administration of the
temporalities and the management of the estates and properties of his religious
denomination, society, or church within his territorial jurisdiction,
describing it;
(4) The manner in which any
vacancy occurring in the office of bishop, chief priest, or presiding elder is
required to be filed, according to the rules, regulations, or discipline of the
religious denomination, society, or church to which he belongs;
(5) The place where the
principal office of the corporation sole is to be established and located, which
place must be within the Philippine Islands.
Section
156
The articles of incorporation must be
verified before filing by affidavit or affirmation of the bishop, chief priest,
or presiding elder, as the case may be, and accompanied by a copy of the
commission, certificate of election or letters of appointment of such bishop,
chief priest, or presiding elder, duly certified to be correct by any notary
public or clerk of a court of record.
Section
157
From and after the filing with the Chief of
the Division of Archives, Patents, Copyrights, and Trade-Marks of the Executive
Bureau of the said articles of incorporation, verified or affirmation as
aforesaid and accompanied by the copy of the commission, certificate of
election, or letters of appointment of the bishop, chief, priest, or presiding
elder, duly certified as prescribed in the section immediately preceding, such
bishop, chief priest, or presiding elder, as the case may be, shall become a
corporation sole, and all temporalities, estates, and properties of the
religious denomination, society, or church theretofore administered or managed
by him such bishop, chief priest, or presiding elder shall be held in trust by
him as a corporation sole for the use, purpose, behoof, and sole benefit of his
religious denomination, society, or church, including hospitals, schools,
colleges, orphan asylums, parsonages, and cemeteries thereof. For the filing of
such articles of incorporation the Chief of the said Division of Archives,
Patents, Copyrights, and Trade-Marks shall collect twenty-five pesos.
Section
158
The successors in office of any bishop,
chief priest, or presiding elder incorporated as a corporation sole shall
become the corporation sole on accession to office, and shall be permitted to
transact business as such on filing with the Chief of the Division of Archives,
Patents, Copyrights, and Trade-Marks of the Executive Bureau of copy of their
commissions, certificates of election, or letters of appointment duly certified
to be correct by any notary public or clerk or a court of record.
For filing such copy of a commission,
certificate, or letters the said Chief of the Division of Archives, Patents,
Copyrights and Trade-Marks shall collect the sum of ten pesos.
During the vacancy in the office of bishop,
chief priest, or presiding elder of any church incorporated as a corporation
sole, the person or persons authorized and empowered by the rules, regulations,
or discipline of the religious denomination, society, or church represented by
the corporation sole to administer the temporalities and manage the states and
estates and property of the corporation sole during the vacancy shall exercise
all the power and authority of the corporation sole during such vacancy.
Section
159
Any corporation sole may purchase and hold
real estate and personal property for its church, charitable, benevolent, or
educational purposes and may receive bequests or gifts for such purposes. Such
corporation may mortgage or sell real property held by it upon obtaining an
order for that purpose from the Court of First Instance of the province in
which the property is situated; but before making the order proof must be made
to the satisfaction of the court that notice of the application for leave to
mortgage or sell has been given by publication or otherwise in such manner and
for such time as said court or the judge thereof may have directed, and that it
is to the interest of the corporation that leave to mortgage or sell should be
granted. The application for leave to mortgage or sell must be made by
petition, duly verified by the bishop, chief priest, or presiding elder, acting
as corporation sole, and may be opposed by any member of the religious
denomination, society, or church represented by the corporation sole: PROVIDED,
HOWEVER, That in cases where the rules, regulations, and discipline of the
religious denomination, society, or church concerned represented by such
corporation sole regulate the methods of acquiring, holding, selling and
mortgaging real estate and personal property, such rules, regulations, and
discipline shall control and the intervention of the courts shall not be
necessary.
Section
160
Any religious society or religious order,
or any diocese, synod, or district organization of any church, unless forbidden
by the constitution, rules, regulations or discipline of the religious order,
society, or church of which it is a part, or by competent authority, may, upon
the written consent of two-thirds of the membership, or by an affirmative vote
of two-thirds of membership had at a regular meeting, incorporate for the
administration of its temporalities or for the management of its properties or
estates by filling with the Chief of the Division of Archives, Patents,
Copyrights, and Trade-Marks of the Executive Bureau articles of incorporation
verified by the affidavit or affirmation of the presiding officer, secretary,
or clerk or other member of such religious society, religious order, or
diocese, synod, or district organization of the church setting forth the
following facts:
(1) That the religious
society or religious order or synod, diocese, or district organization is a
religious society or religious order or diocese, synod, or district
organization of some church;
(2) That two-thirds of its
membership have given their written consent or have voted two incorporate at a
regular meeting of the body;
(3) That the incorporation
of the religious society, religious order, or diocese, synod, or district
organization of the church desiring to incorporate is not forbidden by
competent authority or by the constitution, rules, regulations, or discipline
of the society, church, or order or which if forms a part;
(4) That the religious
society or religious order or diocese, synod, or district organization of the
church desires to incorporate for the administration of its temporalities or
the management of its properties or estates;
(5) The place where the
principal office of the corporation is to be established and located, which
place must be within the Philippine Islands;
(6) The names and residences
of the directors or trustees elected by the religious society or order, or the
diocese, synod, or district organization of the church to serve for the first
year or such other times as may be prescribed by the laws of the society or
order, or of the diocese, synod, or district organization of the church, the
board of directors or trustees to be not less than five nor more than fifteen.
For the filing of such articles of incorporation the Chief of the Division of
Archives, Patents, Copyrights, and Trade-Marks of the Executive Bureau shall
collect twenty-five pesos.
Section
161
By-laws for the government of the
corporation not inconsistent with law or with the constitution, by-laws, rules,
regulations, or discipline of the religious society, religious order, or church
of which the corporation forms a part may be adopted or amended at any regular
meeting called for the purpose by the incorporated religious society or
religious order or by conversation, synod, or other legal representative body
of the church in an for the district.
Section
162
The by-laws of the corporation shall be
signed and attested by the presiding officer and secretary or clerk of the
religious society or order or of the convention, synod, or other representative
body of the church adopting the same.
Section
163
The right to administer all temporalities
and all property held or owned by a religious order or society, or by the
diocese, synod, or district organization of any religious denomination or
church shall, on its incorporation, pass to the corporation and shall be held
in trust for the use, purpose, behoof, and benefit of the religious society or
order so incorporated or of the church of which the diocese, synod, or district
organization is an organized and constituent part.
Section
164
Such corporations shall have the right to
purchase, hold, mortgage, or sell real estate for its church, charitable,
benevolent, or educational purposes by and with the consent of a majority of
its membership.
Section
165
Any number of persons not less than five
who have established or who may desire to establish a college, school, or other
institution of learning may incorporate themselves by filing with the Chief of
the Division of Archives, Patents, Copyrights, and Trade-Marks of the Executive
Bureau articles of incorporation setting forth the following facts:
(1) The name of the
corporation;
(2) The purpose for which it
is organized;
(3) The place where the
college, school, or institution of learning is to be conducted;
(4) The qualifications of
trustees and the number of trustees, which shall not be less than five nor more
than fifteen: PROVIDED, HOWEVER, That the number of trustees shall be some
multiple of five;
(5) The term for which
trustees shall serve and the names and residences of the trustees elected for
the first term;
(6) The amount of money and
description of the property to be devoted to the maintenance and support of the
college, school, or other institutions of learning.
Section
166
Societies or organizations which have
established colleges, schools, or other institutions or learning may, unless
forbidden by their constitutions or by competent authority exercised over them,
incorporate with the written consent of two-thirds of the membership, or by an
affirmative vote of two-thirds of the membership had at a regular meeting or at
a special meeting called for the purpose, by filing with the Chief of the
Division of Archives, Patents, Copyrights, and Trade-Marks of the Executive
Bureau articles of incorporation setting forth the facts prescribed for
articles of incorporation in section one hundred and sixty-five.
Section
167
Societies or organizations so incorporated
shall have the power to adopt by-laws not inconsistent with law and may provide
in such by-laws for the election of trustees and their terms of office.
Section
168
Whenever so empowered in writing by the
Secretary of Public Instruction and under such terms and conditions as said
Secretary may prescribe, universities and colleges duly incorporated in
accordance with this Act may grant diplomas and confer degrees.
Section
169
Unless otherwise provided in the by-laws
the board of trustees of incorporated schools, colleges, or other institutions
of learning shall, as soon as organized, so classify themselves that the term
of office of one-fifth of their number shall expire every year. Trustees
thereafter elected to fill vacancies occurring before the expiration of term
shall hold office only for the unexpired term. Trustees elected thereafter to
fill vacancies caused by expiration of term shall hold office for five years. A
majority of the trustees shall constitute a quorum for the transaction of
business. The office of the corporation shall be at the college, school, or
other institution of learning. The powers and authority of trustees shall be
defined in the by-laws.
Section
170
Any educational society or organization, by
a two-thirds vote of its membership had at a regular or at a special meeting
called for the purpose, or by the written consent of two-thirds of its members
without a meeting, and any existing educational corporation or body claiming to
be such may, by a unanimous vote of its trustees present at a regular or
special meeting called for the purpose or by the written consent of such
trustees without a meeting, convey all or any part of its property, rights, and
franchises to a corporation organized for educational purposes in conformity
with this Act. Any corporation organized for educational purposes in accordance
with this Act shall have the right by and with the consent of a majority of its
membership to purchase, hold, mortgage, or sell real estate for educational
purposes.
Section
171
All corporations whose capital stock is
required or its permitted to be paid by the stockholders in regular, equal,
periodical, payments and who purpose is to accumulate the savings of its
stockholders, to repay to said stockholders their accumulated savings and
profits upon surrender of their stock, to encourage industry, frugality, and
home building among its stockholders, and to loan its funds and fund borrowed
for the purpose to stockholders on the security of unencumbered real estate and
the pledge of shares of capital stock owned by the stockholders as collateral
security, shall be know as building and loan corporations, and the words
"mutual building and loan association" shall form part of the name of
every such corporation.
Section
172
The articles of incorporation shall state
the purposes of the corporation as set forth in section one hundred and
seventy-one.
Section
173
Any person may become a stockholder of any
building and loan corporation by subscribing for one or more shares therein and
signing the by-laws of the corporation, following his signature with his
post-office address.
Section
174
The capital stock of corporations shall be
paid by the stockholders in regular, equal, periodical payments, known as dues,
at such times and in such amounts as shall be provided in the by-laws of the
corporation. The dues on each share or stock subscribed for by a stockholder
shall continue to be paid by the stockholder to the corporation until the share
has been duly withdrawn, cancelled, or forfeited, or until the share has
reached its mature value; that is to say, when the dues paid on each share and
the net earnings thereof, in accordance with the by-laws, shall amount to the
par value of the share, but such corporation may issued and sell at par, for
cash, paid-up or investment stock, and may pay to the holders of such shares a
rate of interest or dividend to be fixed by the board of directors of the
corporation, which shall be expressed in the stock shares and shall not
participate further in the profits or accretions of the corporation. Such
paid-up or investment stock may be surrendered by the holder at any time upon
the giving of ninety days' notice to the corporation, or such briefer notice as
the corporation may fix, and upon such surrender the holder will be entitled to
receive only the amount of principal invested together with the accrued
interest or earned dividend fixed by the board of directors and expressed in
the stock shares. The capital stock shall consist of the proceeds of such
paid-up or investment stock and of such accumulated dues together with the
earnings and profits of the corporation, and shall in no case exceed three
million pesos.
Section
175
The capital stock shall be divided into
shares of the matured or par value of two hundred pesos each.
Section
176
Certificates of stock shall be issued to
each stockholder on the payment of membership fee and first installment of dues
by him. The corporation shall have the power to charge a membership or entrance
fee not exceeding one peso upon each share of stock issued and may also charge
a transfer fee not exceeding twenty centavos on each share transferred, all of
which shall be paid into the treasury and accounted for as funds of the
corporation. Shares which have not been pledged as security for the payment of
a loan shall be called "pledged shares".
Section
177
Payment of dues on shares of stock shall
commence from the time that such shares were issued.
Section
178
For any neglect, refusal, or failure to
make payment of dues or premiums or interest on loans when due, the corporation
shall have power by its by-laws to impose and collect a fine on the delinquent
or defaulting stockholder not exceeding ten per centum of the defaulted amount
due from him and a like fine on every regular pay during such default. Payments
of dues or interest may be made in advance, but the corporation shall not allow
interest on such advance payments at a greater rate than six per centum per
annum nor for a longer period than one year.
Section
179
Whenever any stockholder shall be six
months in arrears in the payment of his dues upon free shares, the secretary or
clerk of the corporation shall give him notice in writing of his arrearages by
mailing to him at the last post-office address given by him to corporation a
statement of all such arrearages. If the stockholder shall not pay within two
months after such notice the full amount of his arrearages the board of
directors may, at its option, declare his shares forfeited. At the time of the
forfeiture the withdrawal value of the forfeited shares shall be determined and
stated by the board of directors, and the defaulting stockholder shall be
entitled to receive such value without interest upon such notice as is required
of a withdrawing stockholder. In determining the withdrawal value of such
forfeited shares the board of directors shall charge such shares with all fines
assessed in accordance with this section.
Section
180
When the stock shall have reached its
matured valued, payment of dues thereon shall cease and holders of such matured
shares shall be paid out of funds of the corporation the matured value of their
shares with interest thereon at the rate determined in the by-laws, from the
time the board of directors shall declare such shares to have matured until payment
is made. The order of payment of matured shares shall be determined by the
by-laws and at no time shall more than one-third of the receipts of the
corporation be applied to the payment of matured shares without the consent of
the board of directors: PROVIDED, HOWEVER, That if shares pledged to the
corporation as security for loans shall mature before the loan is repaid the
matured value may be paid to the holder in cash as in this section provided or
may be credited t the loan at the option of the board of directors.
Section
181
The moneys in the hands of the treasurer of
the corporation and such sums as may be borrowed by the corporation for the
purpose shall be loaned out in open meeting to the stockholders who shall pay
the highest premium for such loan, or said moneys may be loaned at such premium
as may be fixed from time to time by the board of directors. The premium may be
deducted from the amount of the loan or such proportion may be so deducted as
may be prescribed in the by-laws. Where only a part of the premium is deducted
the balance thereof must be paid to the corporation in such installments as the
by-laws shall determine: PROVIDED, HOWEVER, That the number of installments
into which the premium is divided shall be uniform for all loans made by the
corporation, and that the time and manner of payment of such installments shall
be prescribed in the by-laws.
Section
182
Every loan made by the corporation must be
properly evidenced by a note or other instrument in writing and must be secured
by a first mortgage or deed of trust on unencumbered real estate and also by
the pledge to the corporation of shares of stock of the corporation the matured
value of which shall at least equal the amount loaned: PROVIDED, HOWEVER, That
loans may be made on the security of free shares pledged to the corporation for
the repayment of the loan in case, at the time that the loan is made, the
withdrawal value of such free shares under the by-laws shall exceed the amount
borrowed and interest thereon for six months: AND PROVIDED FURTHER, That no
loan on the security of real estate shall be made unless the title to such real
estate have been first registered in accordance with the Land Registration Act
and unless such real estate shall be situate within the city or municipality in
which the principal place of business of the corporation is established.
Section
183
In the discretion of the board of directors
a loan may be repaid by the surrender of pledged shares whose withdrawal value
equals the amount loaned and all interest and fines accrued thereon.
Section
184
The rate of interest on all loans may be
fixed in the by-laws or may be prescribed from time to time by the board of
directors.
Section
185
Whenever a borrowing stockholder shall be
three months in arrears in the payment of his dues on stock or the interest or
premium or installments of premium on any loan, the whole loan, at the option
of the board of directors, shall become due and payable and the board may
proceed by action to enforce collection upon the securities held by the
corporation. The withdrawal value of all shares pledged as collateral security
at the time of the commencement of the action shall be applied to the payment
of the loan, and such shares from the time of such application shall be deemed
to be surrendered to the corporation.
Section
186
The corporation may purchase at any sale,
public or private, any real estate upon which it may have a mortgage, judgment,
lien, or other encumbrance, or in which it may have any interest, and may sell,
convey, lease, or mortgage such real estate: PROVIDED, That real estate so
purchased must be finally disposed of or sold by the corporation within five
years after receiving title to the same.
Section
187
Stockholders may surrender their shares and
withdraw from the corporation after paying twelve monthly installments of dues
and upon giving sixty day's notice in writing to the board of directors, and
the withdrawal value of such shares shall be the total sum of the dues paid
thereon plus such interest as shall be allowed by the board of directors:
PROVIDED, HOWEVER, That not more than one-third of the total receipts of the
corporation shall be paid in any one month to retire such shares: AND PROVIDED
FURTHER, That payment for such surrendered shares shall be made in the order in
which notices of withdrawal have been received by the board of directors: AND
PROVIDED FURTHER, That should the business of the corporation during the period
such withdrawing member has been a stockholder show a loss, the withdrawal
value of stock shall be charged with its proportion of such loss. Except in
cases of voluntary or forced liquidation of a building and loan corporation or
of forfeited as provided by section one hundred and seventy-nine of this Act,
the board of directors of such corporations shall not have power to force the
surrender and withdrawal of unmatured stock.
Section
188
At least once a year profits and losses on
all business transacted shall be determined by the board of directors and
apportioned to all the shares in each series outstanding at the time of such
apportionment on the basis of the actual value of shares as distinguished from
their withdrawal value.
Section
189
Building and loan corporations shall be
subject to all the provisions of Act Numbered Fifty-two, entitle "An Act
providing for examinations of banking institutions in the Philippine Islands,
and for reports by their officers," as amended by Act Numbered Five
hundred and fifty-six, in the same way and to the same extent as if such
corporations were engaged in the banking business in the Philippine Islands.
Section
190
No foreign building and loan corporation or
building and loan corporation not formed, organized, or existing under the laws
of the Philippine Islands shall be permitted to transact business in the
Philippine Islands.
Section
191
The Code of Commerce, in so far as it
relates to corporations or Sociedades Anonimas, and all other Acts or parts of
Acts in conflict or inconsistent with this Act, are hereby repealed, with the
exception of Act Numbered Fifty-two, entitled "An Act providing for
examinations of banking institutions in the Philippine Islands, and for reports
by their officers," as amended, and Act Numbered Six hundred and
sixty-seven, entitled "An Act prescribing the method of applying to
governments of municipalities, except the city of Manila, and of provinces for
franchises to construct and operate street highway, electric light and power,
and telephone lines, the conditions upon which the same may be granted, certain
powers of the grantees of said franchises, and of grantees of similar
franchises under special Act of the Commission, and for other purposes":
PROVIDED, HOWEVER, That nothing in this Act contained shall be deemed to repeal
the existing law relating to those classes of associations which are termed
Sociedades Colectivas, Sociedades en Comandita, and Sociedades de Cuentas en
Participation, as to which associations the existing law shall be deemed to be
still in force: AND PROVIDED FURTHER, That existing corporations or Sociedades
Anonimas, lawfully organized as such, which elect to continue their business as
such Sociedades Anonimas instead of reforming and reorganizing under and by
virtue of the provisions of this Act, shall continue to be governed by the laws
that were in force prior to the passage of this Act in relation to their
organization and method of transacting business and to the rights of members
thereof as between themselves, but their relations to the public and public
officials shall be governed by the provisions of this Act.
Section
192
This Act shall take effect on April first,
nineteen hundred and six.
ENACTED,
March 1, 1906
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