The county record. [volume] (Kingstree, S.C.) 1885-1975, 1897-09-16
USURY OR No USURY?
The Law and the Building and Loan
Associations.
FIGURE BEFORE MAKING LOANS
The Supreme Court of South Carolina
Sustains the Claim Of a Georgia
Building and Loan Association.

The building and loan associations
that have been doing business In this
State have been of decided influence in
the money markets. There are hardly
any towns or cities that are without their
building and loan associations, and
great many places, in addition to having
several home enterprises to loan money
on the building and loan plan, have
foreign agencies. For some time past
there has beon a good deal of litiga-
ton by those who, when they went to
figure up, found that they were paying
more than 6 or or s per cent on their
loans, as they had supposed. Some
of the companies were charging as high
as 12 per cents, and perhaps more, but
it was not exactly in the shape of inter
est, but was paid in for expenses and
the like. The courts have recently
held that these contracts with the build
ing and loan associations are valid, and
that under the regulations of the asso-
Citations the companies do not charge
usurious interest. 1t will therefore be
prudent for anyone going into these
plans to do their figuring before max
ing their loans, instead of after getting
the property with the borrowed money.
A second of the cases recently decid-
ed upon this matter, and which deals
more especially with the foreign build
ing and loan companies, is from Edge
feld county. The Supreme Court rem
ders unanimous opinion, and presents
the entire matter in the opinion of the
court by Justice Gary when it says:
''The facts are more particularly set
out in the decree of his Honor, Judge
Buchanan, from which the plaintiffs
appealed, upon the following excep-
tions:
81. Because His Honor erred in hold
ing that the contracts were to be per-
formed in South Crrolina, and were
South Carolina contracts and governed
by the laws of South Carolina, when he
should have found that the two con-
tracts were governed and controlled by
the laws of the State of Georgia.
t2. Because His Honor erred IN con.
sidering and deciding the question of
usury under the laws of the State Of
6buth Carolina when he should have
considered and decided said questions
under the laws of the State of Georgia.
SO. Because his Honor erred in de-
Gliding and holding that the contracts
were usurious.
"4. Because his Honor erred in hold
ing that the contracts under the laws OF
Georgia were not usurious and no
penalty could attach to the case.
':5. Because his Honor erred in not
allowing the plaintiffs 10 per cent at
torney's fee, when the contracts dis
tinctly specified that 10 per cent at
torney's fees should be allowed if the
contracts were forced to collection by
an attorney.
Sc. Because his Honor erred in hold
ing that the amounts paid monthly on
the shares of the defendant should be
applied to reduce the principal OF the
debt.
't7. Because his Honor erred in find
ing that there was due by the defendant
to the plaintiff on both of said contracts
the total sum of 81, 1,03l. 46.
s's. Because his Honor erred in not
allowing the plaintiff interest on the
amount found due to him from the date
of filing the decree up to the date fixed
for the sale of the real estate.
"The facts in this case are in no re-
spect materially different from those in
the case of the Equitable Building and
Loan Association VS.. Vance, 49 s. c.,
4O2, except that one of the bonds herein
contained the following provision: 1T
is further understood and agreed that
this obligation is a Georgia contract
and in all respects subject to and gov
erned by the laws of Georgia.
"That case is decisive Of all the ques-
tions raised by the exceptions except
the fifth and eighth.
eve do not wish to be understood,
however, as asserting to the doctrine
that if the contracts were to be con-
strued with reference to the laws of
South Carolina, instead OF Georgia,
they would not be usurious.
''The fifth exception will now be con-
sidered. The bonds provide for the
payment of attorneys fees OF 10 per
cent, and as the contracts are held out
to be usurious it follows that there was
error in not allowing such fees.
eve next consider the eighth excep-
ton. This exception seems to have
been taken under misapprehension as
to the effect of the Judgment of fore
closure, as we fail to find where his
Honor decided that the plaintiff was
not entitled to the interest from the
date of the filing of the decree up to
the time fixed for the sale of the prop
erty.
"It is the Judgment of this court that
the Judgment of the Circuit Court be
modified so as to conform to the views
herein announced"