Failey v. Fee

Citations

• 83 Md. 83
• 32 L.R.A. 311
• 34 A. 839
• 1896 Md. LEXIS 57

Syllabus

<p>Mutual Benefit Societies—Matured Certificates—Preferences—Time of Payment—Insolvency of Association—Receivers—Attachments — Validity of Contract.</p> <p>A certificate issued by a mutual benefit association by which the holder is entitled to a certain sum at the end of a term of years, provided he shall pay all lawful assessments and comply with the laws of the association, is not a contract impossible of performance and therefore invalid, although the scheme adopted by the association for carrying out its engagements may be impracticable.</p> <p>The holder of a matured certificate for the payment of a sum of money issued by a mutual benefit association is a creditor of the association, and as such is entitled to priority in payment over unmatured certificates, and has a right to attach the funds of the association when insolvent.</p> <p>The validity of the claims under such matured certificates is not affected by the subsequent insolvency of the association.</p> <p>The matured certificates held by the attaching creditors provided for the payment of a sum not greater than $r,ooo. At the time of the maturity of the certificates the maximum amount was payable under the laws of the association, there were sufficient funds to pay them, and they would have been paid but for the appointment of receivers. Held, that the amounts to which the attaching creditors were entitled were certain and fixed.</p> <p>The certificates provided for payment at the end of seven years, while a by-law of the association, adopted after the issuing of the certificates, provided that the benefits should be adjusted within ninety days after the expiration of the certificate. The charter of the association provided that benefits should be paid as directed either by the by-laws or in the certificate. Held, that the provision as to the time of payment mentioned in the certificate should govern, and that attachments issued after the maturity of the certificates and before the expiration of the nin