Tiley v. Grenada Building & Loan Ass'n

Holden, J., delivered the opinion of the court. The appellee Building’ & Loan Association instituted suit against the appellants E. H. and Clara B. Tiley to recover on a note executed by them in the sum of four thousand dollars, which was to be paid on the building and loan installment plan by the borrowers, who were also stockholders in the association and shared in its profits. The note is in the following form, to-wit: “Exhibit A to Declaration. “Whereas, we as members of the G-renada Building & Loan Association, find the holder of forty shares of stock of the first series, have obtained a loan from said association to the full amount of the maturity value of each of said shares of stock, do hereby promise to pay to said association on the first Monday in each and every month the sum of thirty-three dollars and thirty-three cents interest upon said loan, and we also promise to pay on the first Monday in each month the sum of one dollar for monthly dues on each of said shares of stock, and also such fines as shall be assessed against us, sanctioned by the acts of incorporation and by-laws of said association, for any defaults we may malm in the payment of the above-mentioned interest installments and monthly dues. These payments are to continue until the receipts from all sources by first series, after losses and expenses are paid, shall equal the maturity value of one hundred dollars upon each share of stock in said first series. We further promise, in case of default in the payment of the interest installment upon said loan or monthly dues, or any part thereof, to pay upon de *404 maud to said association four thousand and no/100 dollars, together with all monthly dues unpaid, interest and fines due from us to said association, after deducting the value of said shares of stock at the time of said default, according to the rules and regulations of said association. We also further agree to keep the premises on which a deed of trust of even date herewith is given to secure the aforesaid loan, insured against loss or damage by fire or tornado, to an amount sufficient to cover the indebtedness intended to be secured by said deed of trust until the maturity of this note, and that there shall be embraced in the policy of insurance the following clause: The loss, if any, under this policy shall be payable to Grenada Building & Loan Association, of Grenada, Miss. “If this note is placed in the hands of an attorney for collection, the makers and indorsers hereof agree to pay the holder ten per cent, attorney’s fee upon amount due. “E, H. Tiley. “Clara B. Tiley.” The appellants denied liability upon several grounds, none of which have sufficient merit to warrant discussion except two or three which we shall presently consider and decide. The appellee association was organized under the building and loan statute of our state (chapter 167, Laws of 1912) as amended by chapter 216, Laws of 1914 (chapter 87, Hemingway’s Code), and was operating in the regular manner provided by law when the loan here involved was made to the appellants, who were stockholders in the association. It is contended that the above law violates section 90 of the Constitution of 1890, in that it is a special act which discriminates as between borrowers who may, or may not, be stockholders in the association. We see no merit in this contention, because the question was definitely settled against this view in the case of Halsell v. *405 Merchants’ Union Insurance Co., 105 Miss. 268, 62 So. 235, 645, Ann. Cas. 1916E, 229. The transaction here involved and the character of building and loan association making the'loan in this case are the same as in the H\alsell case, supra. A careful reading of the Halsell case will be convincing that all of the questions presented on this appeal were decided in that case, except possibly one or two, which we shall now proceed to consider. It is urged here that the character of contract of monthly payments by the borrower-stockholder results in a usurious charge of more than ten per cent against the borrower; and at first glance it might seem to appear that the charge would be more than ten per cent. But we disagree with the contention, because the stockholder would share in the profits in the way of dividends, and thus the charge of interest paid by him would be reduced below ten per cent, per annum; at least the record manifests this result; and we may say again that the Halsell aase, supra, is decisive of this point against the appellants. Also see P. B. & L. Ass’n v. McPhilamy, 81 Miss. 61, 32 So. 1001, 59 L. R. A. 743, 95 Am. St. Rep. 454; Wisconsin Lumber Co. v. State, 97 Miss. 571, 54 So. 247. The last ground presented, which is more serious than any of the others, is whether or not chapter 136, Laws of 1916 (Hemingway’s Code, sections 5531-5533), which permits installment loans by persons or corporations other than building and loan associations at five per cent, per annum interest, payable in monthly installments, etc., repeals the said acts of 1912 and 1914 authorizing building and loan associations, such as is the appellee in this case; that the suit here must fail because the appellee has no authority to act as a building and loan association. We are unable to agree with the position of counsel for appellant on this point, because we do not'think the 1916 act repeals the 1912 act, either expressly or impliedly. The scheme authorized by the latter act is wholly different from that authorized by the former act, *406 and.we cannot see wherein the latter act conflicts with the first or was intended by the legislature to interfere with the operation under the former act, but the legislation was for the purpose only of granting the privilege to all persons and corporations to lend money at five per cent, on monthly installments on long terms. We think the latter act is valid, but does not repeal the former laws on building and loan associations in this state. ■ In view of these conclusions the judgment of the lower court is affirmed. Affirmed.