Buist v. Bryan

• Decision Date: 16 April 1895
• Citation: 21 S.E. 537,44 S.C. 121
• Parties: BUIST v. BRYAN.
• Court: South Carolina Supreme Court

21 S.E. 537

44 S.C. 121

BUIST v. BRYAN.

Supreme Court of South Carolina

April 16, 1895

Appeal from common pleas circuit court of Charleston county; James Aldrich, Judge.

Action by George Lamb Buist, as receiver of the Assistance Building & Loan Association, against Daniel Bryan. Judgment for plaintiff, and defendant appeals. Reversed.

Fitzsimons & Moffett and H. E. Young, for appellant.

Mordecai & Gadsden, for respondent.

GARY J.

This is an appeal from an order of the circuit judge overruling a demurrer to the complaint on the ground that it did not state facts sufficient to constitute a cause of action. The complaint and the exceptions Nos. 1, 2, and 3 will accompany the report of the case.

The appellant contends that the complaint shows upon its fact that the mortgage has been paid. In considering this question, this court must determine whether the monthly payments for subscriptions to the shares of stock should have been applied upon the mortgage. The authorities upon this question are by no means harmonious. The question has not directly been decided in this state, though there are authorities bearing upon this point. The authorities in our state have, however, decided two questions: (1) That the money advanced was a loan; (2) that where the mortgage is to secure the monthly payments of interest and dues, and the contract is declared to be usurious, the borrower is entitled to a credit, not only for the amount paid as interest, but also for the amount paid for subscription on the shares of stock, in ascertaining the amount due on the mortgage. In the case of Association v. Bollinger, 12 Rich. Eq. 126 it appears that in December, 1854, Bollinger, who was a member of the association and holder of 10 shares of the capital stock, bid off $2,000 of the funds of the corporation at the premium of 35 percent. The contract, in the beginning allowed a discount of $700 on an advance of $1,300, which was called a purchase of $2,000 of the funds of the corporation. This sum of $2,000 and interest at 6 percent was to be repaid, in sums of $10 at the end of each month succeeding the 14th of December, 1854, the date of the bond and mortgage. These were the provisions of the bond. Before the second Monday of December, 1854, the defendant had made 32 monthly payments, amounting to $320. After the execution of the bond and mortgage, the monthly payments required by the condition thereof were duly made until November, 1856. This constituted a further sum paid of $460. The actual payments on the loan or advance amounted to $1,480. Bollinger set up the plea of usury, which was sustained. Chief Justice O'Neal, delivering the opinion of the court, after reciting the provision of the usury law then of force, concludes as follows: "Under this provision, the corporation will be entitled to recover the sum actually loaned, deducting the payments made. The result will be that $1,300 will be the principal, on which payments to the amount of $1,480 have been made; so the corporation, has been overpaid $180. The consequence is that complainant's bill must be dismissed." It will thus be seen that, in determining the amount due under the mortgage, the association was required to deduct, not only the amount of the dues paid after the execution of the mortgage, but also the amount of those paid before the execution of the mortgage.

In the case of Association v. Dorsey, 15 S.C. 462, it appears that in 1878 the defendant obtained a loan of $1,000 from the said company, and, to secure this loan, gave his bond, with mortgage of real estate, conditioned to pay to the association monthly the sum of $17.25, itemized as follows $5 for monthly subscription on his share; $5 for interest on the sum advanced to him, at the rate of 6 per cent. per annum; and $7.25 for the monthly premium which he contracted to give for the loan,--in all, $17.25. He obtained this sum at public sale, agreeing to give a premium of $1.45, which premium was to be paid monthly, and amounted to $7.25 for five shares. For this amount, and for the monthly interest, as also, the monthly subscription, on his five shares, he gave the bond and mortgage above mentioned; the monthly payments, as therein stated, being in the aggregate $17.25. The defendant failed to meet his bond, and suit was commenced to foreclose the mortgage. The defendant pleaded usury. The following appears in the decree of the circuit judge, which was affirmed on appeal to the supreme court: "It is the opinion of this court that the interest paid to the association plaintiff by the defendant, John Dorsey, should be credited upon the dues that should legally have been collected by the plaintiff, to wit, $5.83 per month, which is the interest, monthly, on $1,000, at the rate of seven per cent. per annum. The amount in interest, installments, and premium paid into the association plaintiff from January, 1878, to November, 1879, by the defendant, John Dorsey, was $174.75. The amount to which the association was entitled from the same date to November, 1879, at 7 per cent. per annum, was $134.09, leaving a balance of $40.66 in favor of John Dorsey. It is therefore ordered, adjudged, and decreed (1) that the complaint be dismissed, with costs; (2) that the balance of $40.66 be placed...