Court Opinion

ID: 5475099
Source: CourtListenerOpinion
Date Created: 2022-01-09 20:49:38.846274+00
Date Added: 2024-06-11T08:33:27.876486
License: Public Domain

By the Court —
Ingraham, P. J.
The evidence shows that these notes were given in advance for premiums and policies under the third article of the charter, and entitled the maker to a dividend, and were subject to the right of the company to nse them for the payment of losses and liabilities, and for any purpose connected with the business of the company. Upon this point there can be no doubt, that the company had a right to use and collect them to pay losses, or for other purposes, if they had been made in compliance with the provisions of that article. It directs that the notes shall be drawn to the order of the company, and be made payable within twelve months from date. In case of renewal, it is provided that the new note shall be given for the same time as the original note, and be subject to the same terms and conditions.
One of the notes is made payable within seven months, and all are payable to the order of the company. The other two notes are payable twelve months after date. This is not in compliance with the conditions prescribed in the charter. Why the notes to be received for this purpose were to be made payable within twelve months is not stated. It may be in relation to the dividends of scrip which are provided for. Whatever may have been the reason, the company had a right to make that a condition; and, having done so, they are limited to notes drawn in accordance therewith, to be used for such' purposes. They had no more authority to take notes payable for a longer period than twelve months, than they had to take them payable to other persons than the company.
We have been referred to cases in which it has been held, that notes payable twelve months after date, have been held to be in compliance with a similar provision in other charters, but in those cases the charters provided that the notes should be payable at the end of or within twelve months, and a note payable twelve months after date came within the provision.
*186In this ease the condition is that they shall be payable within twelve months, and not at the end of that term. We are of the opinion that the court erred in directing a verdict for the amount of the three notes. Tlie judgment ’should have been for the one note of $380 and interest. If the plaintiffs consent to reduce the judgment to that amount and interest, the judgment may be affirmed for that amount and costs. If not, the judgment is reversed and a new trial ordered, costs to abide event.
Ordered accordingly.