Court Opinion

ID: 4003580
Source: CourtListenerOpinion
Date Created: 2016-07-06 11:04:57.0786+00
Date Added: 2024-06-11T07:44:34.804179
License: Public Domain

As pointed out by the court in Ohio Valley Building  LoanAssociation v. County Court, 42 W. Va. 818, *Page 787 26 S.E. 203, the monies held by a building and loan association are not in any sense capital of the organization. They are purely savings which constitute an accumulated fund for the benefit of the members. Code, 31-6-2. True, since the above decision, section 19, chapter 58, Acts 1931, Code, 31-6-19, has authorized the investment of surplus funds not only in real estate as theretofore, but in loans to persons not members of the association. This is merely a convenient manner of preserving the members' money and does not change the foundation principle.
Such funds belong to the members in the several amounts determined by the number of shares of stock they own, respectively. That is as true today as when the opinion in the above case was written. With other corporations the capital funds are corporately owned. This fundamental differentiation between savings organizations and ordinary corporations remains unimpaired by legislation.
In my judgment, this basic fact should require that we adhere to the taxation principle promulgated in the cited case and which has been followed by the taxing authorities of the state since the decision in 1896. That decision, sound in principle, as I see it, and supplemented by forty years of administrative acquiescence and effectuation, should not, in my opinion, be supplanted by a different theory obtaining in some of the other states. In my view a change of base is not warranted.
Therefore, I would affirm the trial chancellor's decree.
With regret, I dissent from the decision of my brethren. *Page 788