Interstate Building & Loan Ass'n v. Edgefield Hotel Co.

Citations

• 120 F. 422
• 1903 U.S. App. LEXIS 5283

Syllabus

<p>1. Building and Loan Associations — Contract of Borrowing Stockholder-Law Governing.</p> <p>The contract of a borrowing stockholder in a building and loan association is governed by the law of the state in which the association is Incorporated and has its home office, although the security may be situated in another state, where the subscription to stock was made and accepted at the home office, and the stock installments, which are ultimately to extinguish the loan, are there payable, as well as the interest by the terms of the bond given for the loan.</p> <p>2. Same — Construction of Contract — Accounting between Association and Borrowing Stockholder.</p> <p>The bond of a borrowing stockholder in a building and loan association provided that his payments of installments on his stock and of interest should continue until the stock was matured by reaching par value. It also contained the following provision: “It is further understood that, upon final settlenient with the association, it shall retain as installment on the said stock and interest no greater sum than the amount actually advanced, with interest thereon at the rate of eight per cent, per annum.” Held that, the association having become insolvent before the maturity of the stock, the borrower was entitled to make final settlement under such provision, being charged with the loan and 8 per cent, interest thereon, and credited with installments of stock and interest paid as partial payments thereon.</p> <p>¶ 1. What law governs usury in contracts of building and loan associations, see note to Kirlicks v. Association, 51 C. C. A. 319.</p> <p>8. Equity Pleading — Affirmative Relief to Defendant — Necessity of Cross-Bill.</p> <p>A defendant in equity can only be given affirmative relief on a cross-bill.</p> <p>¶ 3. See Equity, vol. 19, Cent. Dig. § 450.</p>