Mechanics' & Farmers' Building & Loan Ass'n v. Dorsey

Citations

• 15 S.C. 462
• 1881 S.C. LEXIS 95

Syllabus

<p>1. At a time when there was no statute regulating the rate of interest on money lent, a building and loan association was chartered, with power to make such rules and by-laws as were not repugnant to the constitution and laws of the land; afterwards a usury law was enacted, limiting the rate of interest to seven per centum per annum. Held, that contracts of the association subsequently made were subject to the provisions of this law.</p> <p>2. A member of a building and loan association received $1000, the full amount of his subscription to five shares of the capital stock, agreeing to pay monthly therefor (in addition to his installments of stock subscription,) $5 for interest and $7.25 for premium bid, total, $12.25 per month, or $147 per annum, until the assets of the association were worth $200 for every share. Held, that this was a greater rate of interest than seven per cent. per annum, and was, therefore, usurious.</p> <p>•'3. Columbia Building and Loan Association v. Bollenger, 12 Bich. Eq. 124, recognized and followed.</p>