Court Opinion

ID: 7893518
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:51:05.826408+00
Date Added: 2024-06-11T09:16:26.518028
License: Public Domain

The opinion of the court was delivered by
Doster, C. J. :
This*was an action brought by M. C. Clarke, as receiver of the American Loan and Savings Association, against Samuel • Caufman and others, to recover on a contract for the payment of money and to foreclose a real-estate mortgage given to secure the indebtedness. The receiver derived his authority by appointment of a court of general jurisdiction in Wisconsin, and the association represented by him was a building and loan association which had become insolvent, and whose affairs were under administration by the court. The papers sued . on *62were of the peculiar and anomalous kind customarily-given. in transactions of borrowing and lending between building and loan associations and their members. Substituting in part a statement of the legal effect of the papers for their language, they consisted, in general outline, of a recital of Caufman’s ownership of partially paid stock in the association, of the making of a loan of money to him on a pledge of his stock as part security, payable at a stated future time, and, in the alternative, of an obligation for the payment of monthly dues to be applied in discharge of the indebtedness, together with interest on the sum borrowed, etc.
The defendants demurred to the petition for insufficiency of facts stated and for lack of legal capacity in the plaintiff to sue. The demurrer was sustained, and error has been accordingly prosecuted to this court. The claim of error principally discussed relates to the obligations of comity between the courts of different states to permit suits by the receivers of one jurisdiction in the forum and against the citizens of another. However, the defendants in error make the additional point that the petition failed to state a cause of action, in that it showed on its face that the claim sued on was barred by the statute of limitations. This point is well taken, and, therefore, the matter of judicial comity need not be considered.
In the case of contracts of the character of those in question the general rule is that they are put at an end by the insolvency of the association, and the statute of limitations for their enforcement then begins to run. (Endl. Build. Assoc., 2d ed., §523; Thomp. Build. Assoc., 2d ed., §§171, 203, 297. In Curtis v. *63Granite State Provident Association, 69 Conn. 6, 10, 36 Atl. 1023, 61 Am. St. Rep. 17, it was declared:
“It is now well settled that upon the premature dissolution of an association of this kind, or upon its becoming insolvent and unable to carry out the purposes for which it was created, and passing into the hands of a receiver for the purpose of having its affairs wound up — which is, in practical effect and operation, a dissolution — the borrowing members may be, compelled to pay forthwith the balances due from them on their securities, although the latter in terms only provide for payment by instalments extending over a definite period of time.”
The plaintiff in error seems to recognize this as the law because, in his petition in the court below, he said:
‘ ‘ That upon the insolvency of said association and the appointment of a receiver thereof as hereinbefore stated, the contract between said association and the said defendants, Caufman and Caufman, evidenced by said bond and’ mortgage, became and was abrogated and rescinded and the actual amount loaned as aforesaid by said association, to wit, the sum of $400, became presently due and payable and that said bond and mortgage are security therefor.”
It may be that the above statement is so largely in the nature of a legal conclusion that, although adverse to the plaintiff’s contention, he should not be bound by it; but, be that as it may, we regard it as a correct conclusion under the fact as elsewhere pleaded by him, which was that the receiver was appointed in January, 1896. The suit to recover was instituted in March, 1901, more than five years after the maturity of the obligations had been precipitated by the insolvency of the association.
The plaintiff in error says that the action was really commenced in time, and he has filed a certified copy *64of an original petition, which, were we privileged to take it into account, would show.such to be the fact. The record we have before us is a case-made, and we cannot consider evidence outside of that to show a matter which must of necessity be made a part of the original case.
The judgment of the court below is affirmed.
All the Justices concurring.