The Roanoke daily times. (Roanoke, Va.) 1895-1897, 1896-05-15


GEORGIA STATE BLDG u L. Assoc.
IN the Circuit Court for the City OF Roa-
noke.
Opinion OF the Court Rendered May 9TH 1896.
In passing upon these cases, L shall only pass
upon the question OF usury at this time, that be-
tween the parties. II there be other matters of
difference between the parties, such matters will
DEGREES In these causes.
AS regards the question OF usury, It seems to
Te QUO Upon when Tue courts OF this country are
upon which these associations generally operate
seems to present itself in entirely different lights
to the different courts, and whichever view of
this matter we might adopt, as to whether the
contracts entered Into By these associations are
to our support, an array of authorities not only
reputable but positively brilliant.
MANY have conte1ded that there is no usury in
contracts OF this character; that 1t matters not
how much interest and bonus the associations
may exact OF their members for the loan OF
partnership relation the borrowing member sus-
tatns towards other members of the association
certainty to the length OF tim these xed dues
and charges will continue before the debt has be-
come liquidated by the maturity OF the borrowers
STOCK confess that this has always been, to my
mind, extremely plausible; but when l consider
the expressions OF our own Court OF Appeals in
passing upon contracts OF bui ding associations
entered into under the Act OF 1851, become con-
vlnced that those contracts would surely have
Deen declared usurious, but for the fact the
court was or opinion that the Act OF 1851 relieved
those contracts OF the charge OF usury. Believ-
ing this to be the view entertained by our own
court at the time 1t passed upon those contracts,
shall hold that unless the contracts in the cases
under consideration are protected against the
enacm either Of the State OF VTainia az of
some foreign State under which these respective
associations have been organized, and with refer
ence to whose laws those contracts have been en-
tered into, then these contracts will have to be
declared usurious.
In the view shall take OF some Of these con q.
whether there is any legislative enactment of the
state OF Virginia which would exempt these con-
tracts from the general law OF the State against
usury.
II mas been strenuouely argued that the Act Of
tracts under the Act of 1881 have been djudicsted
by our own court to be valid and non usurious
can shelter themselves under that act.
1t Is entirely unimportant for me to decide
whether this Act has been repealed or not; be-
cause none OF the associations whose contracts
are under consideration were ever organized or
claimed to be organized under that act, they are
contracts are not the kind and character OF con
the Act of 1852
the ~ hite Case" after stating mis- doubts as to
the validity OF thoec contracts, even under the
Act or 1851 states that the relations the parties
to that contract sustained towards each other
was not that OF the borrower aud lender, but that
OF buyer and seller. In other words that the
association, under the Act of 1851, did not lend
money to Its stockholders; but on the contrary,
actually bought in and redeemed its stock held by
the , stockholders, by paying them its present
Not one of the associations whose cases are in
my hands has any such contract, and only one OF
them has contended for any such. All OF them,
In my opinion, are undisguised instances O lend
Ing money to the stockholders. Therefore, L
into consideration in the determination OF these
cases.
more recent enactment or 1888 1894 Justices asso.
Citations In charging what would otherwise be
usuiious interest," and that this act lie retroactive
from pleading usury In contracts entered into
prior to the passage OF that act. Under my con-
sfncton OF tina. act position cannot be main
iZing building associations chartered under the
laws OF this State to do business in the mode and
foreign building associations to como into this
state and transact the same character of business
lend money to its members. and others; to charge
premium. interest, dues and fines; but no
where is one word said about usury; nowhere
does 1t Intimate, by any express language, that
these various charges they are authorized TO
make can be In excess OF ak per centum.
We must bear in mind that there is another
statue in Virginia, expressly prohibiting corpo-
rations from charging usury, and this statute
must be read with that, SO that both Of them
either expressly or by clearest sort of Implication
repeating the former. And no language in this
00e8 tliA
II this construction OF the act be correct. II be-
comes unnecessary for a discussion OF the fur.
ther question as to whether the act is retroactive
or not. If 1t does not repeal tho former act in
reference to usurious charges by rporstions II
becomes altogether immaterial to discuss the so.
called retroactive effect of the statute" / am
tnerefore OF the opinion that there Is no general
law In Virginia. authorizing these CORPORATIONS
TO charge what would be usurous interest were
the same charges made by individuals.
Local Boards.
In all Of the cases hefore m. Sor.ton h-.,It-,.
ana loan associations have como into this State,
and entered into the several contracts in cohtro.
Of the Loan and exception o
established In the city OF Roanoke what is gen
orally known as Local Boards" The boards
have been chartered by the associations ct their
stockholders, having president, board of direc-
tore, secretary and treasurer. In determining the
question as to whether The contracts with these
performed in Virginia, or contracts to he ner.
formed In the State in which these several asso-
clations were chartered, tho existence of these
local toards becomes material fact.
All the contracts under consideration are al.
leged TO De contracts TO be performed in foreign
States. In each case, however, some provision
mas neen made, by the bylaws, for making pay
have been actually made to them. mn IN this
time: do not think that the creation of q local
poaro eumcient OF itself to deprive the associa
lion sioh OF tne right to demand that the contract
party mas expressly contracted Ii should be per.
formed. Nevertheless, do think that the ex-
istence OF such local board is a very material
i INC 10 10 De by the COURT in deermin
uon OF the parties, as to where the contract was,
In fact, to be performed. Each case must stand
or ran, not upon the existence OF local board,
nected with the transaction: and in passing upon
these several eases, shall further on have occa-