tion essential to the operation and management of the property in such amounts as shall be approved by the board.

Letting of apartments in such buildings or structures at a greater rental than the maximum rentals prescribed by law or by the order of the board are prohibited and all such leases will be void for all purposes.

§ 17. Reorganization. 1. Reorganization of limited dividend housing companies, pursuant to sections thirty-six, ninety-six and ninety-seven of the stock corporation law and such other statutes as may be indicated from time to time, shall be subject to the supervision and control of the board and no such reorganization shall be had without the authorization of such board.

2. Upon all such reorganizations the amount of capitalization, including therein all stocks and bonds and other evidence of indebtedness shall be such as is authorized by the board which, in making its determination, shall not exceed the fair value of the property involved.

§ 18. Approval of transfer of buildings and structures. Except as otherwise provided in section fifty-one of this chapter no such limited dividend housing company shall convey, encumber or lease all or any part of its real property to any other person or corporation, without the written consent of the board, provided, however, that leases conforming to the regulations and rules of the board and for actual occupancy by the lessees may be made without the consent of the board. No apartments in such buildings or structures shall be sublet or otherwise transferred or assigned at a greater rental than the maximum rentals prescribed by law or by the order of the board and all such sublettings or other transfers or assignments and agreements thereof shall be void.

§ 19. Summary proceedings. Whenever the board shall be of the opinion that such limited dividend housing company is failing or omitting, or about to fail or omit to do anything required of it by law or by order of the board, and is doing or about to do anything, or permitting anything, or about to permit anything to be done, contrary to and in violation of law or of any order of the board, or which is improvident or prejudicial to the interests of the public, the lienholders or the stockholders, it shall com'mence an action or proceedings in the supreme court of the state of New York in the name of the board for the purpose of having such violations or threatened violations stopped and prevented either by mandamus or injunction. The board shall begin such action or proceeding by a petition to the supreme court, alleging the violation complained of and praying for appropriate relief 'by way of mandamus or injunction. It shall thereupon be the duty of the court to specify the time, not exceeding twenty days after service of a copy of the petition, within which the corporation complained of must answer the petition. In case of default in answer or after answer the court shall immediately inquire into the facts and circumstances in such manner as the court shall "direct without other or formal pleadings, and without respect to any technical requirements. Such other persons or corporations as it shall seem to the court necessary or proper to join as parties

in order to make its order or judgment effective, may be joined as parties. The final judgment in any such action or proceedings shall either dismiss the action or proceeding or direct that a mandamus order or an injunction, or both, issue as prayed for in the petition or in such modified or other form as the court may deter. mine will afford appropriate relief.

§ 20. Construction of buildings; acquisition of land. the board shall have approved of a project for the construction of housing accommodations presented to it by a limited dividend housing company organized under articles three or four of this chapter, such company may undertake the acquisition of the property needed for said project. Such property may be acquired by purchase or, in the case of public limited dividend housing companies, by the exercise of the power of eminent domain, under and pursuant to the condemnation law. The power of eminent domain shall not be exercised by a public limited dividend housing company, except with specific authoriza tion of such action by the board and for such purpose the board shall specify that the acquisition of the property and the construction of the particular housing accommodations in connection with which said power is requested has been determined by the board, after public hearing, to be in the public interest and necessary for the public use. The board may expressly except from its certificate hereunder any part of the property proposed to be acquired as unnecessary to the plan. A duly certified copy of such certificate shall be conclusive evidence as to the matters lawfully certified therein in any proceeding under the condemnation law to acquire property, or any part thereof, set forth in such certificate. In the case of property situated within the city of New York, the corporation may petition the city of New York to acquire the property required for any project, approved by the board and to institute proceedings under chapter twenty-one of the Greater New York charter for the acquisition of title to real property so acquired. The city of New York may acquire such property and the acquisition thereof by the city shall be deemed to be for a public use as in the case of property acquired for the use of any department of the city; but when the city shall have acquired such property it shall convey the same to the corporation upon payment by the corporation of all sums expended, or required to be expended by the city in the acquisition thereof under the provisions of such charter. The city of New York, however, before proceeding with the acquisition of such property may require satisfactory evidence or assurances that the corporation will have available the moneys necessary to complete the conveyance of said property after acquisition thereof by the city.

Whenever in such chapter twenty-one of the Greater New York charter requirement is made for the performance of an act by a department or officer of the city it shall be regarded for the purposes hereof as compliance therewith if with the approval of the board of estimate and apportionment such act be performed by the board or any of its officers designated for the purpose.

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§ 21. Increase of rentals. Whenever it shall appear that the interests of lienholders or stockholders can not otherwise be safeguarded the board shall, notwithstanding the limitations prescribed in this article upon rentals, have power by its order after public hearing and upon written application of a limited dividend corporation, to authorize, and upon such authorization, said limited dividend housing corporation may charge a higher rental per room than the rental fixed in this article. Said hearing shall be held upon no less than twenty days' written notice to the tenants and such notice shall have annexed thereto a copy of the application for increase in rentals. The board may prescribe rules of practice governing such applications. But no such order or authorization shall be made or given unless the board shall find that changes in economic conditions in their application to the project with respect to which request for increased rentals shall have been made are such that the maximum rentals fixed as herein provided are insufficient to meet the payments authorized in section forty-two of this act and unless the board shall find that such insufficiency can not be corrected by reasonable economies in management and operation of said project. The board shall not authorize any increase in rentals in excess of the minimum amount necessary to enable the said corporation to make the said payments authorized in section fortytwo. Any order by the board shall be final and conclusive upon all questions within its jurisdiction, with respect to the project affected thereby, unless reversed or modified on appeal therefrom as hereinafter provided. Within thirty days after notice of the filing of the order of the board has been sent to the said corporation and served upon the said tenants affected thereby in such manner as the board shall prescribe, an appeal may be taken to the appellate division of the supreme court in the department in which the project affected by the order is located, from such order of the board by any party in interest. If notice of such appeal is served upon the board, the board shall, within thirty days thereafter, serve upon the parties in interest a statement of its conclusions of fact and rulings of law in such case. The board may also in its discretion certify to such appellate division of the supreme court, questions of law involved in its order. Such appeal and the questions so certified shall be heard in a summary manner and shall have precedence over all other civil cases in such court. The board shall be deemed a party to every such appeal and its counsel, if it have counsel, or, if it have no counsel, the attorney-general without extra compensation shall represent the board thereon, An appeal may also be taken to the court of appeals in all cases where the decision of the appellate division is not unanimous and by consent of the appellate division or a judge of the court of appeals where the decision of the appellate division is unanimous, in the same manner and subject to the same limitations, not inconsistent herewith, as is now provided in civil actions. It shall not be necessary to file exceptions to the rulings of the board. The board shall not be required to file a bond upon an appeal by it to the court of appeals. Otherwise,

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such appeals shall be subject to the law and practice applicable to appeals in civil actions. Upon final determination of such an appeal, the board shall enter an order in accordance therewith.

ARTICLE 3

PUBLIC LIMITED DIVIDEND HOUSING COMPANIES

Section 30. Public limited dividend housing companies.

31. Consent of board to incorporation of limited dividend companies.

32. Application of stock corporation law.

33. Limited dividends.

34. Time of payment of subscription to stock.

35. Consideration for issuance of stocks and bonds.

36. Minimum amount of stock.

37. Exchange of stock for second lien income debenture certificates.*

38. Limitations.

39. Tax exemption.

40. Mortgages and mortgage bonds.

41. Surplus.

42. Reduction of rentals.

43. Foreclosure.

§ 30. Public limited dividend housing companies. Three or more persons may become a public limited dividend housing company for the purpose of carrying out a project or projects to be authorized and approved by the board in accordance with article two of this chapter, on making, signing, acknowledging and filing a certificate which shall contain:

1. The name of the proposed corporation;

2. The purposes for which it is to be formed which shall be as follows: To acquire, construct, maintain and operate housing projects when authorized by and subject to the supervision of the board.

3. The amount of the capital stock, which shall be at least onethird of the estimated total cost of the project or projects so authorized by the board to be carried out by said company, and if any be preferred stock, the preference thereof.

4. The number of shares of which the capital shall consist, all of which shall have a par value.

5. The city, village or town in which its principal business office is to be located; if located in the city of New York, the borough thereof in which it is to be located.

6. Its duration, which shall not be less than fifty years.

7. The number of directors, which shall not be less than three, one of whom shall always be appointed by the board.

8. The names and post-office addresses of the directors for the first year.

9. The names and post-office addresses of the subscribers to the certificate and a statement of the number of shares of stock which each agrees to take in the corporation.

So in original. [Does not conform to section heading.]

10. A provision that in the event that income debenture certificates are issued by the corporation the owners thereof shall have the same right to vote as they would have if possessed of certificates of stock of the amount and par value of the income debenture certificates held by them. The certificate may permit the retirement of income debenture certificates of the company as and when there shall be funds available in the treasury of the company from the receipt of amortization or sinking fund installments for that purpose. Interest shall be paid by the company upon such income debenture certificates only in the same proportion as dividends may be paid upon the capital stock of the company.

11. A provision that the real property of the corporation shall not be sold, transferred or assigned except under and pursuant to the terms and provisions of this article.

12. A declaration that the corporation has been organized to serve a public purpose and that it shall remain at all times subject to the supervision and control of the board or of other appropriate state authority; that all real estate acquired by it and all structures erected by it, shall be deemed to be acquired for the purpose of promoting the public health and safety and subject to the provisions of the state housing law and that the stockholders of this corporation shall be deemed, when they subscribe to and receive the stock thereof, to have agreed that they shall at no time receive or accept from the company, in repayment of their investment in its stock, any sums in excess of the par value of the stock, together with cumulative dividends at the rate of six per centum, and that any surplus earnings in excess of such amount, if said company shall be dissolved, shall revert to the state of New York.

13. A declaration that all of the subscribers to the certificate are of full age; that at least two-thirds of them are citizens of the United States and that at least one of them is a resident of the state of New York; that at least one of the persons named as a director is a citizen of the United States and a resident of the state of New York.

§ 31. Consent of board to incorporation of limited dividend companies. If any such certificate shall be presented to the secretary of state he shall not file said certificate unless there shall accompany the same a certificate of the board that it approves the project for which said public limited dividend housing company is to be formed and that it consents to the filing of such certificate.

§ 32. Application of stock corporation law. The provisions of sections ten, eleven, fifteen, thirty-five, forty-five to fifty-one inclusive, fifty-five, fifty-seven to sixty-one inclusive, sixty-five to seventy-three inclusive, seventy-five to seventy-seven inclusive, of the stock corporation law shall be applicable to any corporation formed under this article so far as consistent herewith, provided that one director shall be designated by the said board, who need not be a stockholder.