Licking County Saving, Loan, & Building Ass'n v. Bebout's Adm'r

Gilmore, J. If the loan in this case consisted of the cash received on taking it, which was $410, exclusive of the premium bid for precedence, which was $390, the decree of the district court was correct, and must be affirmed. If, on the other hand, the loan consisted of the aggregate of these .sums, i. e., $800, the decree was erroneous, and must be reversed. The object of these associations, and the powers with which they are clothed on becoming incorporated, are expressed in very general terms in the statute authorizing their incorporation. Each association, when incorporated, is left at liberty to adopt such a scheme or plan for working out and accomplishing its object as the members of the association may by its by-laws provide, and so long as these do not violate any of the provisions of the statute, nor transcend the powers granted, they will be binding and obligatory upon and between the members and the association. The by-laws of this association are brought upon the record by the bill of exceptions, and no question is raised as to their validity. This case is, therefore, to be determined by the provisions of these by-laws. One of. the declared purposes of the association, as expressed in the first section of the by-laws, is to enable members “ to receive the amount of their shares in advance upon furnishing good mortgage security.” The second section [255] provides, in substance, “ that all moneys of the association, .after payment of expenses, shall be applied in loans or advances to such members as shall require to borrow the amount of their respective shares; in paying off the shares of members withdrawing from the association, and in the payment, at the expiration of the association, the full value .of such shares therein as may remain therein unadvanced.” The seventh section provides that “ as soon as each and ■every shareholder for each and every share of stock by him, her, or them held shall have received the sum of two hundred dollars, or its equivalent, this association shall cease and .terminate.” The thirty-sixth section provides as follows : “ Whenever ■any loan or loans are to be made, the member taking the same shall either pay or allow to be deducted the premium bid for the same.” These provisions of the by-laws develop and make sufficiently apparent the plan or scheme upon which this association sought to accomplish its -purpose. The ultimate object was the making of each share .of stock worth $200. It was to the interest of every member, whether a borrower or not, that this object should be attained at the earliest period that it could be legally done in-pursuance of the scheme adopted; and each member bound himself to co-operate with his fellow-members in accomplishing it. A loan for a sum less than $200, being the value of one share, or for a sum less than $200 on each share upon which loans were to be made, is nowhere provided for in the by-laws, and could not have been in the minds of the members at the time they adopted them. The mode by which this association ascertained and estimated the value of its stock from time to time, is very .■clearly shown by the testimony of its secretary, set out in the bill of exceptions. lie says : “ The estimate of the valuation was made by adding together the amount of all the mortgages held by the association against the members, including the premiums therein, and adding to this any delinquent dues, and interest due from members,' and cash on. [256] hand, and dividing this aggregate by the number of share» held by all the members of the association, and the result was taken as the value of each share.” We think that the-scheme of this association could not have been carried out by adopting any other basis than the one thus indicated, and that it is in accordance with the provisions of the bylaws. The section of the by-laws under which the plaintiff, as-administrator in the courts below, sought to surrender the-stock of his intestate and have the mortgage cancelled, reads-as follows: “ Sec. 8. Upon the death of a shareholder who has not received a'loan or loans, his or her heirs or legal representatives shall be entitled to continue to pay the monthly dues,, and enjoy all the privileges as if he, she, or they had been original shareholders; or they shall be entitled to receive-from the association the value of the stock of such decedent as the same was assessed at the annual meeting of the association immediately preceding his or her decease, first deducting his or her fines and arrearages, and portion of expenses and losses sustained, if such there be. Should the-said deceased shareholder have received a loan or loans, his or her heirs or their representatives may return the same to-the association, or continue to pay the interest and monthly dues, and become in all respects a member of this association until the same shall terminate.” It is under the latter clause of the section that the claim-is made. It will be observed that there is an alternative offered to the heirs or legal representatives of decedents, either to return the “ loan” to the association, or continue-to pay interest and dues and to become, in all respects, members of the association until the same shall terminate. It-must be presumed that these alternatives were intended to-have substantially the same effect upon the rights of the-parties, whichever might be chosen. The latter, if chosen, would require the performance of the decedent’s contract according to its terms until the termination of the association, by which it would receive all the benefits of the con [257] tract, which, would be the payment of dues and interest the value of the stock, should be equal to $200 on each share on which the loan was taken. If the former should be chosen, it would seem to be a necessary implication that the “ loan” to be returned, should be the equivalent of that which would result from carrying out the contract under the latter alternative, viz., two hundred dollars for each share of stock on which the loan was taken, and the equivalent could be ascertained in the manner indicated in the first clause of the section, aud when the latter clause is read in connection with the first, this conclusion more clearly appears to be the true one; and when the entire section is read in connection with the scheme or plan upon which the objects of the association are to be wrought out and accomplished, there can be no doubt that the word “loan,” as used in the latter clause of the section under consideration, must mean the amount of money received and the amount x of premium inclusive, in other words, the sum of $200 per share for each share of stock upon which the loan was based. Any other construction would require a surrender, by the association, of the benefits of the contract by which. the decedent had obligated himself to it. In the absence of language expressly requiring it, this can not be done. The district court erred in holding that the loan to be returned was the amount of money actually received by the decedent. Motion granted; judgment reversed, and the cause remanded to the district court for further proceedings.