Chap. 427.—An ACT to amend and re-enact section 5431 of the Code of Vir-
ginia, as heretofore amended, in relation to investments that may be made
by executors and other fiduciaries. [S B 218]

Approved March 24, 1928

1. Be it enacted by the general assembly of Virginia, That sec-
tion fifty-four hundred and thirty-one of the Code of Virginia, as
heretofore amended, be amended and re-enacted so as to read as
follows:

Section 5431. In what securities fiduciaries may invest.—Execu-
tors, administrators, trustees, and other fiduciaries may invest the
tunds held by them in a fiduciary capacity in the following securi-
‘ies, which are and shall be considered lawful investments:

First. In the bonds or interest-bearing notes or obligations of
the State of Virginia, or those for which the faith of the State of
Virginia is pledged to provide for the payment of the principal and
nterest.

Second. In the bonds or interest-bearing notes or obligations of
he United States, or those for which the faith of the United States
s pledged to provide for the payment of the principal and interest,
ncluding the bonds of the District of Columbia, and farm loan
yonds issued under an act of Congress approved July seventeenth,
1ineteen hundred and sixteen, known as the Federal farm loan act.

Third. In the bonds or interest-bearing notes or obligations of
ny State of the United States which has not, within twenty years
lext preceding the making of such investment, repudiated or de-
aulted in the payment of any part of either principal or interest of
any debt authorized by the legislature of such State to be con-
tracted.

Fourth. In the legally authorized bonds of any county, city or
town in Virginia, provided the said bonds are the direct obligation
of the county, city or town issuing the same, and for which the
faith and credit of the issuing county, city or town is pledged.

Fifth. In the legally authorized bonds of any city, situated in
any one of the States of the United States, which has been an
incorporated city at least twenty years and has not, within ten
years next preceding the making of such investment, repudiated or
defaulted in the payment of any part of either principal or interest
of any bond, note, or other evidence of indebtedness, and provided
such city (a) has a population as shown by the Federal census next
preceding such investment of not less than ten thousand inhahit-
ants, and (b) that the net indebtedness of such city (including the
issue in which such investment is made) after deducting the amvuunt
of its water bonds and bonds issued for other self-sustaining public
utilities, does not exceed ten per centum of the value of the taxable
property in such city, to be ascertained by the valuation of such
property therein for the assessment of taxes next preceding the
making of such investment, and (c) that the bonds in which such
investment is made are the direct obligation of the city issuing the
same, and for which the faith and credit of the issuing city 1s
pledged.

Sixth. In bonds and negotiable notes directly or collaterally
secured by a first lien on real estate in the State of Virginia, not to
exceed sixty per centum of the fair market value of said real estate
at the time of making such investment, as ascertained by an ap-
praisal thereof made by two reputable and disinterested persons.

Seventh. In bonds and negotiable notes directly or collaterally
secured by a first lien on improved real estate situated in any in-
corporated city in any other of the States which comprise, wholly
or in part, the fifth Federal reserve district of the United States, as
now constituted (pursuant to the act of Congress of December
twenty-third, nineteen hundred and thirteen, known as the Federal
reserve act, as amended), not to exceed sixty per centum of the
fair market value of said real estate, with the improvements there-
on, at the time of making such investment, as ascertained by an ap-
praisal thereof made by two reputable and disinterested persons, and
provided that such city has a population, as shown by the Federal
census next preceding such investment, of not less than five thou-
sand inhabitants.

Eighth. In the bonds of any of the educational institutions of
the State of Virginia which have been or may be authorized to be
issued by the general assembly of the State of Virginia.

Ninth. In the stocks, bonds or other securities of the Richmond,
Fredericksburg and Potomac Railroad Company.

Tenth. In the mortgage bonds and secured interest-bearing di-
rect obligations of any railroad corporation (except street rail-
roads), whose railroad is located wholly or in part in the State of
Virginia, provided that, preceding such investment (a) such rail-
road has been in continuous operation for at least ten years, and
(b) has not during such period repudiated or defaulted in the pay-
ment of any part of either principal or interest on any of its mort-
gage or other fixed interest indebtedness, and in addition thereto
(c) has paid dividends out of income, to the holders of all classes
of its issued and outstanding capital stock, for at least two years
next preceding such investment.