Court Opinion

ID: 3827710
Source: CourtListenerOpinion
Date Created: 2016-07-06 08:00:09.748179+00
Date Added: 2024-06-11T14:13:56.399124
License: Public Domain

The only contention made on rehearing is that the Hahn Case, supra, and not the Holt Case, supra, is controlling. The opinion in the Hahn Case shows that the defendant pleaded that the relation of lender and borrower existed. It also shows that no evidence was introduced by defendants. Defendants in that case made no contention that they were in a different class from other stockholders *Page 210 
and were discriminated against in the matter of dividends. Their sole defense was, in effect, that the payments actually made exceeded the constitutional contract rate of interest and constituted usury without regard to the question of mutuality. Assuming their pleading was sufficient to present the defense of lack of mutuality they introduced no proof thereto. If they had made such contention and supported same by sufficient quantum of proof, as they might have done, then, under the Holt Case, the event of that action might have been different. In short, this court, in the Hahn Case, assumed that there was mutuality among the members, there being no proof to the contrary, and did not consider the effect of lack of mutuality in determining whether the contract should be enforced as a building and loan contract. The contention that the Hahn Case is controlling in the instant case is to beg the question, since the question of mutuality is properly raised and it inheres in the verdict, reasonably supported by competent evidence, that there was lack of mutuality. The section of the by-laws indorsed on the certificate shown by the opinion above tends to show a discrimination or lack of mutuality among the members, not permitted by the law at that time. This and other testimony bring this case clearly within the rules of the Holt Case. The contention on rehearing that other loans of the association may be vulnerable to the rules of the Holt Case is untenable judicially. The aims and purposes of such associations, as authorized by law at the time in question, are enumerated in the Holt Case, the purpose of the law being to enable aggregations of laborers and those of moderate means, by weekly or monthly assessments, to accumulate a fund to be loaned to those so contributing, for the purpose of building their homes — a co-operative plan. It seems such original purpose did not contemplate the purchase of stock by those seeking attractive investment for their surplus capital, but not desiring to borrow from the common fund for home building, such investors having preference rights of interest under said by-laws. In 1915 the Legislature provided that payments made by the borrower as dues on installments on shares of stock should not be computed as interest on the loan. It provided in 1913 that such associations may dispense with the offer of moneys for bid and in lieu thereof loan their moneys to members at such rate of interest, or interest and premium, as may be provided by the by-laws; that premiums paid in installments should not be deemed usurious, but taken to be payments as it falls due, and be lawful unless the premium with interest should exceed one per cent. per month. These, together with the other immunities, were matters of legislative cognizance, and indeed very materially changed the original purposes of such associations. These have no retroactive force affecting the instant case. This court is bound to apply the law governing such associations as they existed at the time of the transaction herein. This was done in the opinion above by following the Holt Case, which, we think, on mature consideration, is controlling.
Let the opinion by SHACKELFORD, C., herein be refiled as the opinion of the court, and rehearing denied.