S. Bldg. & Loan Ass'n of Knoxville, Tenn. v. Price

• Court: Court of Appeals of Maryland
• Writing for the Court: FOWLER, J.
• Citation: 88 Md. 155,41 A. 53
• Decision Date: 29 June 1898
• Parties: SOUTHERN BUILDING & LOAN ASS'N OF KNOXVILLE, TENN. v. PRICE.

41 A. 53
88 Md. 155

SOUTHERN BUILDING & LOAN ASS'N OF KNOXVILLE, TENN.
v.
PRICE.

Court of Appeals of Maryland.

June 29, 1898.

Appeal from circuit court, Allegany county.

Action by John Price against the Southern Building & Loan Association of Knoxville, Tenn., to recover the withdrawal value of certain stock in defendant company. From a judgment in favor of plaintiff, defendant appealed. Affirmed.

Argued before McSHERRY, C. J., and BRYAN, PAGE BRISCOE, BOYD, PEAROE. & FOWLER, JJ.

John Ridout and Benj. A. Richmond, for appellant.

W. C. Devecmon, for appellee.

FOWLER, J. The plaintiff was a stockholder of the Southern Building & Loan Association of Knoxville, Tenn. Whether he is a resident of that state, or of Maryland, does not appear; nor has any question been made as to the effect the fact of his residence in the former state, if it be a fact, might have upon any of the questions here presented. Bagby v. Railroad Co., 86 Pa. St. 291; High, Rec. S 241. This action was commenced by attachment on original process, issued, at the instance of the plaintiff, out of the circuit court

41 A. 54

for Allegany county; but the defendant corporation appeared, and the questions we are to decide arose entirely upon the pleadings in the short-note case. While there appears to be some confusion as to the condition of the pleading as set forth in the record, it was conceded by counsel that the main and controlling question intended to be presented arises upon the demurrer to the fifth replication to the fifth plea. The plaintiff withdrew his stock on the 21st December, 1896; and the defense set up by the fifth plea is that neither at the time such notice was given, nor at any time before suit was brought, was there any fund in the defendant's hands applicable, under its by-laws, to the payment of the plaintiff's claim. The plea avers that the plaintiff was a stockholder of the defendant corporation, and subject to its by-laws, one of which was as follows: "Withdrawn stock will be paid for in the order in which notice is given, but the association shall not be required to use in the payment thereof, in any one month, without the consent of the board of directors, more than one-half of the net receipts of the loan fund for that month." The plea also alleged that according to said by-laws the plaintiff was only entitled to be paid upon his alleged withdrawal, by the defendant, in the order in which said notice of withdrawal had been given, and only then to the extent of. one-half of the net receipts, unless by consent of the board of directors, and that, at the time of said withdrawal notices, other withdrawals had been made by other members to such an extent, in prior order, as to consume much more than the whole fund applicable as aforesaid to the payment of the plaintiff's withdrawal stock, and that the plaintiff never obtained the required consent of the directors. To this plea the plaintiff replied, by his fifth replication, in substance, that it was true the plaintiff was a stockholder, as alleged, until he had given notice of withdrawal, but that when such notice was given, and received and accepted by the defendant, the plaintiff became a creditor of the defendant for the amount owing on said withdrawal stock, under the charter and by-laws of defendant, subject, of course, to the provisions of such charter and by-laws, that the amount claimed on his withdrawal stock was not to be demandable until after the payment of withdrawing stockholders who had given prior notices, and that the defendant could not be compelled to use in the payment of said claim more than one-half of the net receipts of the loan fund each month; that such provisos, however, were made upon the condition and with the understanding that the defendant would continue its business according to its charter and its contract with the plaintiff so to do, and that on the 16th of April, 1897, being a Tennessee corporation, it was, by a decree of the chancery court of that state, placed in the hands of a receiver; that such receivers took possession of its assets in Tennessee; and that the defendant thereupon ceased to do business in the manner provided by its charter and by its contract with the plaintiff, and ceased to have any receipts whatever applicable to the payment of withdrawn stock. To this replication the defendant demurred.

The contention of the plaintiff is that upon the facts set forth in this replication the amount claimed by the plaintiff became legally due and demandable, and was demandable when and before his attachment was issued; that is to say, from and after the passage of the decree in Tennessee placing the defendant in the hands of receivers, when it ceased to have any assets applicable to the payment of the plaintiff's claim, and became unable to perform its contracts and promises. The question thus presented is a narrow one. but quite important. What is the effect of the...