Lewis v. Am. Sav. & Loan Ass'n

CourtUnited States State Supreme Court of Wisconsin
Citation98 Wis. 203,73 N.W. 793
PartiesLEWIS v. AMERICAN SAVINGS & LOAN ASS'N ET AL.
Decision Date11 January 1898

OPINION TEXT STARTS HERE

Appeal from circuit court, Dane county; Robert G. Siebecker, Judge.

Action by L. V. Lewis against the American Savings & Loan Association and another to have securities deposited with the state treasurer applied in the payment of the claims of Wisconsin shareholders. William D. Hale, as receiver of the American Savings & Loan Association, was made a party defendant, and from a judgment for plaintiff he appeals. Affirmed.

The American Building & Loan Association was incorporated and organized April 15, 1887, under and by virtue of the laws of Minnesota, as a building and loan association, having its principal office and place of business at Minneapolis, Minn.; and it continued to transact its corporate business there until 1893, when its corporate name was changed to that of the American Savings & Loan Association. The general nature of its business was declared to be “to assist its members in saving and investing money, and in buying and improving real estate, and in procuring money for other purposes, by loaning or advancing under the mutual building society plan, to such of them as might desire to anticipate the ultimate value of their shares, funds accumulated from the monthly contribution of its stockholders, and also such other funds as may from time to time come into its hands.” The government of the corporation and the management of its affairs was vested in a board of seven directors, elected by the stockholders. Membership was acquired by taking stock in the company, and paying the prescribed admission fee. The directors were authorized “to enter into such contracts and agreements, and appoint such agents for its business management, as they may deem for the best interest of its affairs”; and the directors “might sell and dispose of the mortgages held by the corporation whenever they might deem best, and as provided by the by-laws.” No by-laws were ever passed on this subject. July 11, 1889, the articles of incorporation were amended so as to provide that “the board of directors shall not sell or dispose of any of the mortgages held or owned by this corporation.” The principal question presented by the appeals is as to the construction, validity, and effect of the law of Wisconsin requiring foreign mutual building and loan associations to make a deposit of securities of the value of $100,000 with the state treasurer of Wisconsin as a condition upon which such corporations might receive a license from and do business in the state. The statute (Sanb. & B. Ann. St. §§ 2014a, 2014b) provides that “no foreign building and loan association shall issue its shares, receive moneys, or transact any business in this state, unless such association shall have and keep on deposit with the state treasurer of Wisconsin, in trust for the benefit and security of its members in this state, the securities of the actual cash value of $100,000 of the kind mentioned in section 2 of this act, to be approved and accepted by said state treasurer, and held in trust as aforesaid, until all shares of such association held by residents of this state shall have been fully redeemed and paid off by such association and until its contracts and obligations to persons and members residing in this state shall have been fully performed and discharged.” And it was provided that “if any securities on deposit as provided in this act are wholly or partially extinguished by payments on the same or otherwise, or such securities depreciate in value for any cause, new securities must be added, so that the deposit may at all times be kept good and of the value of $100,000.”

The defendant association was doing business in this state from the time of the passage of the above act, having 246 members in Wisconsin, 162 of whom became such prior to the date on which the law went into force, to wit, April 19, 1889. The plaintiff, Lewis, a resident of Wisconsin, the holder of five shares of stock, upon which $243 had been paid, alleging that there are a large number of residents and citizens of the state of Wisconsin legal members, owning and holding stock, in the defendant association, whose names he was unable to get, or their post-office address, charged that the defendant association was insolvent; that a large part of its assets had been improvidently invested and squandered, and that, on the application of a creditor or creditors thereof residing in Minnesota, William D. Hale, the appellant, had been appointed receiver of all the property of the defendant association by the courts of Minnesota, in proceedings initiated therein; that, under the laws of Wisconsin, the defendant was entitled to withdraw all the securities deposited with the state treasurer, and substitute other and similar securities therefor, and that, during the year then passed, the defendant association had withdrawn a large portion of the securities theretofore duly deposited with the state treasurer of Wisconsin, and substituted in their stead other securities; that such securities so deposited consist in large part of mortgages upon real estate, which are likely to depreciate in value unless enforced according to law, and that the only property of said association in Wisconsin was the securities aforesaid, from which, if not preserved and properly cared for and converted into cash, it would be impossible for resident members of said association to recover back moneys paid into said association; that it was necessary for the protection of the rights of the plaintiff, and of the members and stockholders in said defendant association resident in the state of Wisconsin, that a receiver for the defendant association in Wisconsin should be appointed, in order to ascertain all of the members and stockholders in said association residing in Wisconsin, and the amount of their respective claims, and to convert into money the securities so deposited for their protection, and distribute the same to such persons as may be entitled thereto, under the direction and supervision of the court; and an injunction was sought restraining the defendant Peterson, as state treasurer, from in any manner parting with the custody and control of said securities, and permitting any withdrawal or substitution of the same. Judgment was prayed that said securities so held be sequestrated and distributed among the members and stockholders of said association who are residents of the state of Wisconsin, including the plaintiff, according to law; that a receiver or receivers, to take charge thereof, and convert the same into money, with the usual powers and authority, be appointed. An injunction restraining and enjoining all persons from proceeding in any manner or way to obtain a lien on said securities, and from in any manner interfering with or intermeddling with the same, was prayed for; and that the court direct notice to be given, as it might deem proper, requiring all members and stockholders of said association who are residents of the state of Wisconsin to submit their claims, and become parties to the action, within such reasonable time as might be fixed by the court; and for such other and further relief, etc. In addition to these facts, it appeared from the pleadings that some time prior to May 10, 1889, the defendant association deposited with the state treasurer of the state of Wisconsin, in trust for the benefit and security of all its members in that state, securities consisting of mortgages taken by it in the course of its business, to the actual cash value of $100,000, which were duly approved and accepted by such treasurer, and which had since been held in trust by him and his successors in office, under the laws of this state relating to foreign building and loan associations, by which the state treasurers are required to hold such securities until all shares of stock in said association shall have been fully redeemed and paid off by the defendant association, and until all contracts and obligations of the defendant association to members and persons residing in the state of Wisconsin shall have been fully performed and discharged; that the defendant Peterson, as such state treasurer, holds said securities in his custody under said trust to the face value of $113,891.80. The appellant, William D. Hale, who had been appointed by the district court of Hennepin county receiver for said association, petitioned the court to be made a defendant in the action in the circuit court for Dane county; and it was ordered accordingly, and he interposed an answer and counterclaim, in which he admitted that the association was duly licensed by the state of Wisconsin to do business in said state in the year 1889, which said license was continued from time to time thereafter until the 1st day of January, 1894. The plaintiff and the defendant S. A. Peterson, as treasurer, etc., and M. C. Clarke, the receiver appointed by the circuit court of Dane county, Wis., demurred to said answer and counterclaim. Orders were entered sustaining the demurrers, from which the defendant William D. Hale, the receiver appointed by the Minnesota court, appealed. The board of directors of the defendant association passed a resolution May 1, 1889, as follows: “Resolved, that the state treasurer of Wisconsin be made a depository of the association for temporary convenience in complying with the law of Wisconsin in regard to the deposit of securities, $100,000. Also, resolved, that the association comply with the Wisconsin law as soon as possible.”

The counterclaim alleged: (1) That the mortgages belonging to the American Savings & Loan Association in the possession of S. A. Peterson, state treasurer, at the time of making and filing plaintiff's complaint aggregated in value the sum of $145,234. That prior to the 11th of July, 1889, there was delivered to said Peterson, as such treasurer, mortgages...

To continue reading

Request your trial
41 cases
  • Meholin v. Carlson
    • United States
    • United States State Supreme Court of Idaho
    • March 3, 1910
    ......Flowers, 116 Ga. 219, 42. S.E. 474; Heilbrou v. Guarantee Loan & Trust Co., 13 Wash. 645, 43 P. 932.). . . The. court ... Me. 532, 35 Am. St. 385, 27 A. 525; National Home. Building Assn. v. Home Sav. Bank, 181 Ill. 35, 72 Am. St. 245, [17 Idaho 746] 54 N.E. ...611; Whitney Arms Co. v. Barlow, 63 N.Y. 62, 20 Am. Rep. 504; Lewis v. Amer. S. &. L. Co., 98 Wis. 203, 73 N.W. 793, 39 L. R. A. 559.). . ......
  • Morrill v. American Reserve Bond Co. of Kentucky
    • United States
    • U.S. District Court — Western District of Missouri
    • January 10, 1907
    ......H. Wetter Mfg. Co., 78 F. 7,. 14, 15, 23 C.C.A. 609, 616; Memphis Sav. Bank v. Houchens, 115 F. 96, 106, 52 C.C.A. 176, 186;. Missouri Broom ...436, 447, 2 Sup.Ct. 878, 27 L.Ed. 780; Seibert v. Lewis, 122 U.S. 284, 7. Sup.Ct. 1190, 30 L.Ed. 1161. Such a suit may also be. ... the amendments to the Constitution. Lewis v. American. Sav. & Loan Ass'n, 98 Wis. 203, 73 N.W. 793, 39. L.R.A. 559. . . The. ......
  • City of Williston v. Ludowese
    • United States
    • United States State Supreme Court of North Dakota
    • March 16, 1926
    ...9 N. D. 364;Tourtelot v. Whithed, 84 N. W. 8, 9 N. D. 467, 478;Wald v. Wheelon, 147 N. W. 402, 27 N. D. 624;Lewis v. Savings Association, 73 N. W. 793, 98 Wis. 203, 39 L. R. A. 559;Eastman v. Parkinson, 113 N. W. 649, 133 Wis. 375, 13 L. R. A. (N. S.) 921;Crowder State Bank v. Powder Co., 1......
  • Denny v. Guyton, 28922.
    • United States
    • United States State Supreme Court of Missouri
    • May 27, 1931
    ...Bowman Co. v. Mooney, 41 Mo. App. 665; Winscott v. Guarantee Co., 63 Mo. App. 367; City of Goodland v. Bank, 74 Mo. App. 365; Lewis v. Assn., 98 Wis. 203, 224; First Natl. Bank v. Guardian Trust Co., 187 Mo. 494; Luhrig Collieries Co. v. Interstate Co., 281 Fed. 271; Thompson on the Law of ......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT