126 Iowa 464 | Iowa | 1905
' Now, the act of the Twenty-Eighth General Assembly in effect worked a repeal of the former statute authorizing the creation of an expense fund. .After such act took effect there was no longer any right to levy á fixed charge upon stock or stock payments for such purpose, or otherwise to set apart moneys to be devoted to the payment of expenses, whatever the source from which the same were derived. The provision is simply that “ all expenditures and expenses for management and conducting the affairs of said association * * * shall be paid from the receipts of interest, premiums, and other sources of profit.” The act provides for a limitation upon the amount which may be thus expended — as applied to the defendant association being two and one-half per cent, on its assets as shown by its last annual report. The defendant amended its articles of incorporation and bylaws to bring the same into conformity with the change thus made in the statute. Consideration of the foregoing must make it manifest that with the taking effect of the amenda-tory statute it became impossible for the defendant to carry out its contract by making payments conformably to the terms thereof as written. By general acceptance the expression “ expense fund ” means a fund set apart and dedicated to expense purposes. The defendant no longer has an expense fund which it can divide with plaintiffs, either voluntarily or under stress of judicial decree. True, it is still authorized to meet the current expenses of conducting its business, ,but this it may do only by drawing upon moneys on hand derived
This must be true, as otherwise relief could be granted only upon the hypothesis that the power is lodged in the court to-make a new contract for the parties, and to require of the defendant that, without reference to the amount actually needed by it to pay current expenses, it must draw from profit sources the full sum of two and one-half per cent, on all its assets traceable to payments on stock sold by the plaintiff firm, and make division thereof on a moiety basis. There is no authority that recognizes the existence of such power in the courts. Moreover, as we think, any attempt, however made, to divert the profit fund of the association to the extinguishment of a contract obligation in character as here claimed under the guisé of current expense, would be an act in contravention of both the letter and the spirit of the present statute. It follows that the court, as presided over by Judge Prouty, erred in finding that the contract had been breached, and in holding that in view of the extinguishment of the expense fund, compensation could be made by resorting to moneys in the hands of the association derived from profit sources.
Counsel for appellees point out that the moneys sought to be recovered by the plaintiff firm in this action had actually
II. At a later term of the court the matter involved in the counterclaim pleaded by defendant came on for trial, Judge McHenry presiding. The judgment of dismissal was based upon the insufficiency of the evidence to support the allegations of such counterclaim. .We have read the record in full, and we agree that the trial court had no warrant for reaching any other conclusion.
From what we have said it follows that in respect of the first appeal the interlocutory decree must be, and it is reversed; in respect of the second appeal, the judgment dismissing the counterclaim must be, and it is, affirmed.
Reversed on first appeal; affirmed on second appeal.