Ruppel v. Missouri Guarantee, Savings & Building Ass'n.

• Decision Date: 11 December 1900
• Citation: 158 Mo. 613,59 S.W. 1000
• Court: Missouri Supreme Court
• Parties: RUPPEL et al. v. MISSOURI GUARANTEE, SAVINGS & BUILDING ASS'N.

59 S.W. 1000

158 Mo. 613

RUPPEL et al. v. MISSOURI GUARANTEE, SAVINGS & BUILDING ASS'N.

Supreme Court of Missouri, Division No. 1.

December 11, 1900.

BUILDING AND LOAN ASSOCIATIONS — COMPETITIVE BIDDING — PRIVATE USURIOUS AGREEMENTS — DECREE FOR ACCOUNTING.

1. Under Rev. St. 1899, § 1362, requiring competitive bidding at public auction for loans made by building and loan associations, it is not necessary that the ceremony of public auction be had, where the bid of the stockholder to whom the loan is awarded, the only one submitted at the directors' meeting, is in writing, and is not constrained by any arbitrary action of the association.

2. Under Rev. St. 1899, § 1362, requiring competitive bidding at public auction for loans made by building and loan associations, if a loan is made by a private usurious agreement between a stockholder and the association, and a trust deed given to the association to secure the debt, a court of equity will determine the amount lawfully due, and decree the borrower a cancellation of the trust deed on condition that he pay the association the amount found to be due.

3. The fact that a debtor has once tendered the amount due, and it has been refused, will not extinguish the debt.

4. An offer to pay so much, on condition that defendant would receive it in full satisfaction of its demand, where a larger sum was claimed, is an insufficient tender, being conditional.

5. Where plaintiff seeks equitable relief, and fails to specify in his bill his disposition to do what is right, the court will require him to do so as a condition of relief granted.

Appeal from circuit court, Lawrence county; J. C. Lamson, Judge.

Action by L. Ruppel and others against the Missouri Guarantee, Savings & Building Association. From a judgment in favor of plaintiffs, defendant appeals. Reversed.

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 100 months, $17.50 as dues on the stock, $21 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, Rev. St. 1889, now section 1362, Rev. St. 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 59 months, beginning with June, 1892, ending May, 1897, plaintiffs 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 plaintiffs 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 100 months for the loan; admitted that plaintiffs had paid $17.50 monthly for 59 months, amounting to $1,032.50, as for dues on the stock subscribed for, and $21 monthly for 58 months, and one payment of $6.99, amounting to $1,224.99, as for interest, and $14 a month for 58 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 100 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 100 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...