When the commissioner upon investigation finds that a domestic society: (a) Has exceeded its powers; (b) has failed to comply with any provision of sections 38a-595 to 38a-626, inclusive, 38a-631 to 38a-640, inclusive, and 38a-800; (c) is not fulfilling its contracts in good faith; (d) has a membership of less than four hundred after an existence of one year or more, or (e) is conducting business fraudulently or in a manner hazardous to its members, creditors, the public or the business, he shall notify the society of his findings, state in writing the reasons for his dissatisfaction and require the society to show cause on a date named why it should not be enjoined from carrying on any business until the violation complained of has been corrected or why an action in quo warranto should not be commenced against the society. If on such date the society does not present good and sufficient reasons why it should not be so enjoined or why such action should not be commenced, the commissioner may present the facts relating thereto to the Attorney General who shall, if he deems the circumstances warrant, commence an action in the superior court for the judicial district of Hartford to enjoin the society from transacting business or in quo warranto. The court shall thereupon notify the officers of the society of a hearing. If, after a hearing, it appears that the society should be so enjoined or liquidated or a receiver appointed, the court shall enter the necessary order. No society so enjoined shall have the authority to do business until: (a) The commissioner finds that the violation complained of has been corrected; (b) the costs of such action have been paid by the society if the court finds that the society was in default as charged; (c) the court has dissolved its injunction; and (d) the commissioner has reinstated the certificate of authority. If the court orders the society liquidated, it shall be enjoined from carrying on any further business, whereupon the receiver of the society shall proceed at once to take possession of the books, papers, money and other assets of the society and, under the direction of the court, proceed forthwith to close the affairs of the society and to distribute its funds to those entitled thereto. Whenever a receiver is to be appointed for a domestic society, the court shall appoint the commissioner as such receiver. The provisions of this section relating to hearing by the commissioner, action by the Attorney General at the request of the commissioner, hearing by the court, injunction and receivership shall be applicable to a society which voluntarily determines to discontinue business.

(1949 Rev., S. 6264; 1957, P.A. 448, S. 26; P.A. 78-280, S. 6, 127; P.A. 88-230, S. 1, 12; P.A. 90-98, S. 1, 2; P.A. 93-142, S. 4, 7, 8; P.A. 95-220, S. 4–6.)

History: P.A. 78-280 substituted “judicial district of Hartford-New Britain” for “Hartford county”; P.A. 88-230 replaced “judicial district of Hartford-New Britain” with “judicial district of Hartford”, effective September 1, 1991; P.A. 90-98 changed effective date of P.A. 88-230 from September 1, 1991, to September 1, 1993; Sec. 38-242 transferred to Sec. 38a-620 in 1991; P.A. 93-142 changed the effective date of P.A. 88-230 from September 1, 1993, to September 1, 1996, effective June 14, 1993; P.A. 95-220 changed the effective date of P.A. 88-230 from September 1, 1996, to September 1, 1998, effective July 1, 1995.