White v. Williams
| Decision Date | 21 March 1900 |
| Citation | 45 A. 1001,90 Md. 719 |
| Parties | WHITE v. WILLIAMS. |
| Court | Maryland Court of Appeals |
Appeal from circuit court, Wicomico county, in equity; Henry Page Judge.
"To be officially reported."
Action by Isaac H. White against Jay Williams, assignee of the Baltimore Building & Loan Association of Baltimore. From an order confirming an auditor's account, plaintiff appeals. Reversed.
Argued before MCSHERRY, C.J., and FOWLER, BOYD, BRISCOE, SCHMUCKER and JONES, JJ.
Toadvin & Bell, for appellant. Fielder C. Slingluff and Jay Williams for appellee.
This case is brought to this court upon an appeal from an order passed by the court below ratifying an auditor's account. The facts of the case which preceded this order and gave rise to the controversy decided thereby are as follows: On the 11th day of March, 1893, the appellant, together with his wife, executed to the Baltimore Building & Loan Association of Baltimore, a body corporate, a bond in the sum of $1,500 which, after stating that it was for money borrowed from the said corporation on 15 shares of its stock, and that it was secured by a deed of trust of even date, is conditioned to well and truly pay the monthly interest on the said sum of $1,500 at the rate of 6 per cent. per annum from the date of the bond, the monthly dues on the said shares of stock, the monthly premiums on the said shares, all fines assessed against the appellant under the rules and regulations of the corporation, all taxes and assessments upon the real estate covered by the deed of trust, all premiums of insurance necessary to keep the property insured, and all fees, costs, and expenses to which the said corporation might become liable by reason of any litigation touching the transaction with the appellant as "a member of and borrower from" the same "until the said stock shall become fully paid in, and of the par value of one hundred dollars per share, and shall then surrender the said stock" to the corporation. The bond then provided that, if the "obligation be discharged before the said stock reaches the par value of $100 per share, as aforesaid, whether by voluntary payment by consent of parties, or by enforcement of the deed of trust securing it, or otherwise, the same shall be credited with the value of said fifteen shares of stock, to be determined by the board of directors of said association according to the rules of valuations laid down in the bylaws or by resolution of the board of directors, and as of the date of such payment." On the same day the appellant and his wife executed to the said corporation a mortgage which recites: "Whereas, the said mortgagor, Isaac H. White, being a member of the said body corporate, has received an advance or loan to the amount of fifteen hundred dollars on fifteen shares of its stock held by the said Isaac H. White in his own name, the said sum of fifteen hundred dollars being the par value of said fifteen shares, and upon which the mortgagors hereby agree to pay during the continuance of this mortgage a premium of seven dollars and fifty cents on the last Saturday of each and every month, the interest on the said loan on the last Saturday of each and every month at the rate of six per cent. per annum, and the dues of nine dollars on the last Saturday of each and every month, and also such fines and penalties as may be imposed upon him by the by-laws, in accordance with the stipulations hereinafter mentioned." The condition of the mortgage is that the mortgagors "shall make the payments and perform the covenants herein on each of their parts to be performed until the said stock becomes fully matured and of the value of one hundred dollars ($100) per share." The mortgagors having made default in the payment stipulated for in the bond and mortgage, the same were assigned by the corporation to the appellee here for collection, and the mortgaged property was sold by him under a power of sale contained in the mortgage, and the proceeds of sale were distributed by the assignee by a statement filed with his report of sale in accordance with the claim of the appellee as to the amount to which he is entitled in settlement of the mortgage claim. Upon objections to this proposed distribution of the fund by the appellant, the case was referred to an auditor, who stated four several accounts after hearing evidence submitted by the respective parties. In account No. 1 he treated the transaction between the parties thereto as an ordinary loan. In account No. 2 he allowed the appellee the amount of the advance to the appellant, with interest thereon to day of sale, and credited appellant with the value of his stock as made to appear from evidence before him, and with the amount of interest paid by appellant, and, in addition, allowed him for amount paid as premium, with average interest on same. In account No. 3, after allowing for expenses and commissions as in other accounts, he allowed to appellee the amount found in the evidence to be necessary to mature the appellant's stock. In account No. 4, after charging appellee with amount of sales, and allowing for expenses, etc., he allowed his claim as originally made, less a small amount overpaid for insurance. As shown by a statement filed with the auditor, the result in this account is arrived at by charging the appellant with the amount of the original loan, interest for 9 1/2 months, --being for the time intervening between the last payment by him of dues, interest, and premium, as provided in the mortgage, and the day of sale,--with amount denominated in the mortgage as premium for the same time, and with small amounts for fines and insurance and with a release fee; and allowing him as a credit the amount actually paid in by him for dues and average interest thereon. To account No. 4 appellant excepted, "because the amount allowed in said audit to the assignee of said mortgage is largely in excess of the amount due thereon," "and for that the amount so allowed in Audit No. 4 to said assignee is usurious." The appellee excepted to accounts Nos. 1, 2, and 3. The court ratified account No. 4, and rejected Nos. 1, 2, and 3.
The single specific ground of objection by the appellant to account No. 4 of the auditor is that the amount allowed thereby to the appellee consists in part of usurious charges and it is therefore the only objection this court can notice in giving consideration to the order appealed from. Darby v. Rouse, 75 Md. 26, 22 A. 1110; Miller, Eq. Proc. § 545, note 1, and cases there cited. The charter of the Baltimore Building & Loan Association is not before us, but the case has been argued upon the briefs and at the oral argument upon the concessum that, in the language of appellant's brief, it is "a mutual association, based on a mutual plan." In other words, it is of the class of corporations familiarly known as "building associations," and classified in our general incorporation act under the head of "Building or Homestead Associations," with their powers and privileges defined in sections 95 to 99, inclusive, of article 23 of our Code; and it will be seen from the provisions of the bond and mortgage herein set out that the transaction in question was intended to be one that would come within the powers therein conferred upon such corporations. The charge of usury is aimed at the exaction made in the contract between the...
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