Evening capital. (Annapolis, Md.) 1884-1910, 1902-05-03
IMPORTANT DECISION.
Rendered By Judge James Revell In The
Case of Stoddard VS.. Davidson.

4 NN~AS
Judge Reyell on Tuesday handed down
a decision IN the case of ]. G. Stoddard
et al, VS.. VIM. t. Davidson, on excep.
tions to an auditors account.
The facts of the case are that Davidson
borrowed from the Washington National
Building Association $1,000, executed a
deed OF trust for this amount and a bond
IN double the amount. The contract pro-
| yided that the borrower should monthly.
for not more than 81 months, paw s. 20
dues, 5000 interest and $500 premium.
making a total of $500 month The
deed of trust provided that after S4months
no payment should be made on account
OF dues or premium, but if the stock had
matured then 5000 per month should be
paid until the maturity of the stock
Davidson sold the mortgaged property
TO Timothy ID. keleher, who assumed the
mortgage. According to the mortgages
contention, the mortgage debt was in Ge-
fault and Stoddard, trustee, foreclosed
Two auditors accounts were stated-on e
on the contention of the mortgage. who
brought the mortgagor in debt $f92. IS;
the other on behalf of mortgagor, which
brought the mortgagee in debt to him
S349.S2. The Court sustains the latter
contention and says in effect that there
is nothing in the evidence 10 show that
the mortgagor participated in the profits
OF the association, hence the relation be
tween the parties was that of borrower
and lender, or mortgagor and mortgage
and therefore any money received by the
mortgagee IN excess of the principal and
interest was usurious."
Previous TO 1894 borrowers from such
associations wo1ld pay bonus in ad-
VA Ayrv oh
1894, II was provided that the "bonus." or
premium, might be paid monthly. This
act has never been construed by the
Court of Appeals.
Judge ReYell in constituting this saws:
Nowhere is il stated in the Dapers- SC.
what was the specific amount agreed on
as premium. The premium Of so cents
per month on each 500 advanced ap-
pears only in the written application for
the loan. The monthly prem
iums were not TO continue longer than
~ months. If the share of stock matured
In that time, the premium would amount
to S5O4.OO. If they matured at an earlier
date the premium would be less: the
amount OF premium was therefore uncer-
tain. Now, the Act of 1894, chapter 33I.
clearly means that the premium was 10
be fixed and certain sum, that is. a de
finite sum for the whole period of the
loan and not variable snm dependent
on contingencies.
I'm this case no forced construction
could warrant the assertion that a def
mite sum as premium had been agreed
upon.
"The arrangement If in conflict with
the Statute as to premiums, must be re-
garded as illegal rendering the same usu-
rious.' The privilege granted by said
Act OF 1894 is very extraordinary and
unusual one, and no contract should be
brought within its operation unless made
and executed in strict conformity with
law. See Judge Jones admirable opin-
ion in White VS.. Williams, Goth Maryland
especially pages 724-5-6-7-S.
II take it that Judge Jones never in
tended that such a construction as claim
ed by the mortgagee's attorney could be
placed on the Act of 1894, chapter 32f;
on the contrary, the opinion was, as il
appears to me, so guarded and the whole
trend of it, carefully considered, was TO
exclude such construction.
That case, the authorities thereon
quoted and commented on, and the case
of the Middle States Loan, Building and
Construction Company VS.. Baker, re-
ported in 29th volume of Washington, ID.
c., Law Reports, page 7S5, are, in my
judgment, conclusive of this case. Con-
sequently auditors account A (the mort
gagor's contention) will be ratified and
account be rejected