Ruppel v. The Missouri Guarantee, Savings and Building Association
| Decision Date | 11 December 1900 |
| Parties | RUPPEL et al. v. THE MISSOURI GUARANTEE, SAVINGS AND BUILDING ASSOCIATION, Appellant |
| Court | Missouri Supreme Court |
Appeal from Lawrence Circuit Court. -- Hon. J. C. Lamson, Judge.
Reversed and remanded.
Morton Jourdan for appellant.
(1) The portion of defendant's answer stricken out constituted a good defense. Springfield Eng. Co. v. Donovan, 147 Mo. 622; Hughes v. Ass'n (Tenn.), 46 S.W. 362; R. S. 1889, sec. 2812. The application, written bid, and the action of the board of directors, as pleas, constituted a good defense, and show a full compliance with the law. (2) The oral testimony of plaintiff as to contents of application, declarations and statements of agent were inadmissible. Tracy v. Iron Works, 104 Mo. 199; Lumber Co. v. Kreeger, 52 Mo.App. 422; Williams v. Edwards, 94 Mo. 451. (3) Under the evidence there was no tender. This being true, the judgment should have been for defendant. Henderson v. Cass Co., 107 Mo. 50; Kitchen v. Clark, 1 Mo.App. 430. (4) Under the pleadings the judgment should have been for defendant. The debt was not due, and the plaintiff was therefore not entitled to an accounting. Fisher v. Patton, 134 Mo 32; Brown v. Archer, 62 Mo.App. 291. He was not entitled to an accounting, for his stock had not matured. Bertche v. B. and L. Ass'n, 147 Mo. 343; Sweeney v. B. and L. Ass'n (Tex.), 26 S.W. 292; Abbott v. B. and L. Ass'n, 85 Tex. 220; Laws Mo. 1895, p. 105, sec. 15. (5) The judgment can not stand. The plaintiff admitted an indebtedness of $ 1,100. He made no tender. He made no payment. He made no deposit. He made no payment into court. If it was right to find against defendant upon the issues, the court should, upon the confessed indebtedness of $ 1,100 from plaintiff to defendant, have required plaintiff to pay the amount into court and then enter the judgment cancelling the note, and discharging the lien upon the real estate.
H. H Bloss for respondent.
(1) The part of the action stricken out is simply a dissertation of reasons why it was not necessary to comply with a plain and positive statute regulating the manner in which funds of the association could be loaned. R. S. 1889, sec. 2812; Price v. Empire Loan Ass'n, 75 Mo.App. 551; Moore v. Bldg. Ass'n, 74 Mo.App. 468; Miller v. Mo. Guar. Savgs. & Bldg. Ass'n, 3 Mo.App. Rep. p. 346; McCauley v. Bldg. Ass'n, 37 S.W. 212. (2) A technical tender of the money was not necessary under the pleadings and evidence in this case. This action is an equitable suit to ascertain the amount due on a complicated building and loan mortgage. The authorities cited by appellant have reference to a legal tender in an action at law. The rule of tender in the case of mortgages of the kind in controversy is different. Thornton & Black on Bldg. Ass'n, sec. 292, p. 301. The rule of a legal tender does not apply in equitable actions. Kline v. Vogel, 90 Mo. 239. And if this was a case where an actual tender was necessary, there was a waiver of such tender on the part of appellant. For appellant advised respondent that it would not accept $ 1,100 in satisfaction of their debt. This would be a waiver in an action at law where the rule is strictly enforced. Johnson v. Garlichs, 63 Mo.App. 578; Enterprise Soap Works v. Sayers, 55 Mo.App. 15; Howard v. Deimer, 41 Mo.App. 49. (3) Appellant's next contention to the effect that respondent was not entitled to an accounting because the stock had not matured would be correct if this loan was not usurious. When a contract is shown to be usurious, courts will not compel the borrower to continue it for years in an endeavor to mature the stock. McCauley v. Workingmen Bldg. Ass'n (Ken.), 37 S.W. 215; Miller v. Mo. G. S. & B. Ass'n, 3 Mo.App. Rep. 346; Price v. Empire Loan Co., 75 Mo.App. 556.
This is a suit in equity for an accounting as to the amount due on a deed of trust given by plaintiffs to defendant, and for a cancellation of the deed on paying the amount ascertained to be due. Defendant corporation is a building association organized under the laws of this State, and plaintiff L. Ruppel is a borrowing stockholder; his co-plaintiff is his wife, who according to the petition is the owner of the mortgaged land.
It appears from the pleadings that in June, 1892, plaintiff L. Ruppel subscribed for $ 3,500 of stock in defendant company and borrowed that amount from defendant, pledging the stock and executing with his wife the deed of trust in question to secure the loan. The note or obligation which he signed to evidence the debt, was of the kind usual in such transactions with building associations, wherein he promised to pay the defendant, on the 20th of each month, for a period of one hundred months, $ 17.50 as dues on the stock, $ 31 interest, and $ 14, "being the premium for the preference and priority of loan," on the amount borrowed. The petition avers, that the money was not put up at public auction as the statute, section 2812, Revised Statutes 1889 (now sec. 1362, R. S. 1899), requires; that there was no competitive bidding, but that the usual monthly payments above named as for dues, interest and premium, amounting to $ 52.50 a month, were but arbitrary amounts fixed by agreement between the borrower and lender and put in that form to evade the usury laws of the State; that for a period of fifty-nine months, beginning with June, 1892, ending May, 1897, plaintiff paid the $ 52.50 monthly, amounting in all to $ 3,097.50, so that on June 8, 1897, there was due on the mortgage only $ 961.53 by plaintiffs' count, but that defendant claims $ 2,800 still due; that plaintiff had offered to pay $ 1,109.25 for a settlement and cancellation of the indebtedness, but defendant had refused the offer; that plaintiffs were ready and willing to pay whatever the court upon accounting should find to be due, and prayed for an accounting and for a satisfaction of the deed of trust on payment of the amount so ascertained.
The answer admitted that plaintiff L. Ruppel became a stockholder to the amount named, borrowed the $ 3,500, and executed the obligation as set out in the petition, but denied that the loan was not made according to the requirements of the statute named, or that the $ 52.50 was merely the amount agreed to be paid monthly for one hundred months for the loan. Admitted that plaintiff had paid $ 17.50 monthly for fifty-nine months, amounting to $ 1,032.50 as for dues on the stock subscribed for, and $ 21 monthly for fifty-eight months and one payment of $ 6.99, amounting to $ 1,224.99, as for interest, and $ 14 a month for fifty-eight months and one payment of $ 4.66 amounting to $ 816.66 as for premiums, and denied all the other allegations.
The answer then goes on to state in effect that when the loan was made the fund was not in fact put up at public auction, because there were no bidders present, but the transaction was as follows: Plaintiff applied for the loan in writing, and in the application bid so much for the preference; the application was received and opened by the board of directors in a regular meeting for such purpose; the plaintiff was not present and no one was present except the directors themselves; the plaintiff's bid was the only one there, and thereupon the board of directors declared it the highest and best bid and awarded the loan to him and that he accepted the money on those terms, and executed the papers in question. The answer dwells at much length on the circumstances to show that the transaction was a substantial compliance with the statute, and also that plaintiffs are estopped to question it. The answer also makes the point that if the transaction should be regarded as not in compliance with the statute as to putting the fund up to public auction, then it is still not usurious if the payments are spread, as by contract they were to be, over a term of one hundred months, and that plaintiffs have no right to stop the payments at the end of 59 months and thus estimate it as usury.
The court, on motion of plaintiffs, struck out all that part of the answer attempting to show a substantial though not a literal compliance with the statute and estoppel, and that the calculation should cover the whole period of a hundred months, to which defendant excepted.
On the trial the plaintiff L. Ruppel testified in effect that he was not present at the meeting at which the loan was made and did not in open meeting bid for the money or authorize any one to bid for him; that he had nothing to do with fixing the rate of premium and did not know who did; that his application for the loan was in writing, and that in April, 1897, he offered to pay defendant $ 1,100 in full of the obligation, and it was refused; did not actually tender the money but was prepared to do so and would have done so but for the fact that defendant refused the offer; was then (at the trial) ready and willing to pay that amount or any sum the court should find due to defendant. When it appeared that the application for the loan was in writing, defendant objected to the oral testimony as to the terms of the offer, but the objection was overruled and defendant excepted. This was substantially all the evidence on the only disputed fact in the case, that in relation to the putting of the fund up at auction.
The findings and decree were to the effect that the money was not put up at auction as the law requires; that the loaning of the money in the manner it was done was a mere device to evade the usury law; that plaintiffs had received in the loan $ 3,500 from defendant, had paid it $ 52.50 a month from June, 1892, to May, 1897, in all $ 3,097.50, had then offered to pay the full amount due; that plaintiffs were entitled to an accounting, and upon such...
To continue reading
Request your trial