22 Kan. 549 | Kan. | 1879
The opinion of the court was delivered by
This was an action to foreclose a mortgage given by the plaintiffs in error to the building association, defendant in error. The case was tried by the court, without a jury. Special findings of fact were made, and a decree entered foreclosing the mortgage. Of this decree plaintiffs in error complain, and allege two principal grounds of error. They insist, in the first place, that under the constitution and by-laws of the association, as they existed at the time of the execution of the mortgage, the plaintiff could not recover, or at least that the method adopted by the court in computing the amount due was wrong, and the recovery excessive; and, ■secondly, that the association, by certain amendments to its •constitution and by-laws, had precluded itself from complying with its obligations in the premises, and was therefore in no position to complain of defendants’ default.
The facts in the case are these: On October 8, 1874, the •defendants executed a note and mortgage for $3,000 to the plaintiff. (In fact, three mortgages were in suit, but for ■convenience we shall speak of them as one.) The note read
The following are the sections of the constitution of the-association which bear upon this question. We group them here:
“Art. V, § 1. Every stockholder shall pay on each share-held by him or her $2 per month, monthly dues on each share subscribed, to the secretary, or such other person or-persons as may from time to time be appointed to receive the same.”
“Art. XV, § 1. As soon as the directors ascertain that the-value of shares in the oldest series amounts, to $500, the holder of each such share shall receive the sum of $500, or-have the same allowed on his indebtedness to the association.”'
“Art. X, § 1. Stockholders taking loans from the company shall pay interest on the same every month, at the rate-of three-fourths, of one per cent, per month. If the interest is allowed to remain unpaid for more than four months, the-*553 directors shall compel payment of principal and interest.”' Section-2 of the same article provides, that “the member, before receiving thé loan, must give to the corporation a good and sufficient security for the payment of his dues, fines and interest that may accrue on his loan during the time he may hold the same, by a mortgage upon real property, to be approved by the board of officers.” Section 5 of the same article: “If any member having received a loan shall fail to-pay his dues for four months, the corporation may compel payment by the sale of the mortgaged property, the proceeds to be applied, first, to the payment of all expenses of said sale, arrears of taxes, etc.; second, to pay all arrears due the corporation by such member; and the balance, if any, to be paid to the member himself or his legal representative. Such delinquent member shall then cease to be a member of the corporation.” Section 6, same article: “No real estate shall be taken as security which has not the full value of the mortgage.” Section 7, same article, provides that “any member of this corporation proposing real property as security for redemption-money,” etc.
“Ant. XIII, § 1. Any member having received a loan and desiring to repay the same shall repay to the association the money received by him, together -with the loss and expenses the association may sustain in the reloan of said, money in the same series.”
We fail to see in those sections that which would change the character of the contract from such as it appears on the face of the papers, or would limit the right of the association to enforce a collection of this note. There may be in some a lack of precision, fullness and perspicuity, but nothing to-gainsay the contract. Those sections which refer most pointedly to the contract are the clearest. Sec. 1, art. 10, which alone provides for the case of a default in the payment of interest, says that the directors shall compel payment of principal and interest. What language can be plainer? Sec» 5, art. 10, upon which counsel have much to say, evidently was intended to apply, not to a case of default in the payment of interest, but to a case where interest is paid and dues not paid. And while the expression, “arrears due the-corporation,” is not apt, yet when construed in connection, with §1 of the same article, the meaning is clear.
That such a corporation and such a contract as appear in this case are authorized by the statutes of this state, is apparent from the mere citation of the following sections:
“ 27. The accumulation and loan of funds to members, the erection of buildings, and the accumulation and loan of funds for the purchase of real property.” (Gen. Stat., ch. 23, §5; as amended, Laws 1871, ch. 65.)
“3. That premiums bid for priority of loan in building and saving or trust associations, organized under the corporation laws of this state, by the members of such associations, shall not be deemed as usury or subject to the provisions of sections 3 and 4 of an act regulating the interest of money,” (Gen. Stat. 1868, ch. 51;) “and all such premiums incorporated in the notes given by the members of the associations, and all the fines assessed against its members in accordance with the by-laws of such associations, may be collected by civil action before any court having jurisdiction.” (Laws 1869, ch. 5, §1.)
The other proposition of counsel is, that certain amendments of the constitution of defendant in error precluded a recovery. These amendments were as follows: Sec. 1, art. 5, and sec. 1, art. 15, heretofore cited, were amended so as to read:
“Art. 5, §1. Each stockholder shall pay on each share which he or she has taken, $2 monthly, as monthly installments for each share for which he has subscribed, except that the monthly payments on shares which are not pledged to the association shall cease after June, 1876.”
“Art. 15, §1. The directors are instructed to close the business of the association, and to pay off the shares which are not pledged to the association. As often as sufficient money is in the treasury to pay one-tenth of the indebtedness, the directors shall pay ten per cent, on each share.”
It is found by the court, that prior to the adoption of these amendments, which took place in June, 1876, all the non-borrowing members had given notice of withdrawal. And the constitution originally provided (art. 8, §3), that “the dues on such shares shall cease from the time notice to withdraw the same is given.” Now we fail to see how the amend
The judgment will be affirmed.