Wise Bros. v. Yazoo Building & Loan Ass'n

Citations

• 105 Miss. 78
• 62 So. 1

Syllabus

<p>BuildiNG and Loan Associations. Paid up stocJc. Withdrawal. Redemption value. Demand 'for payment. Creditors. Liquidation.</p> <p>Where by its charter the directors of a building and loan association were authorized in their discretion, to issue interest bearing stock in exchange for matured stock and such directors did authorize the issuance of such stock upon the withdrawal of paid stock, by resolution providing for such issuance if their attorney approved, and such attorney refused to approve of the same, the issuance of such stock by the secretary of the company was unauthorized and not binding upon the association.</p> <p>2. Same.</p> <p>Where by the universal custom of such association, holders of paid up stock where allowed to withdraw their stock and take the withdrawal value in cash and there was no by-law of the association condemning this practice, the holders of such stock, who withdrew it, and took in exchange interest bearing stock which was void because not authorized by the board of directors, became creditors of the association for the value of the stock withdrawn' after paying the cash necessary to mature the stock, and were entitled to demand the amount of the matured stock and six per cent, interest from the date of withdrawal.</p> <p>3. Same.</p> <p>The fact that the tentative settlement of the claim of such Stockholders, by the issuance of interest bearing stock was defeated by the attorney’s refusal to approve the issuance does not affect such holder’s claim or demand against the association.</p> <p>4. Same.</p> <p>Nor does the fact that the association, though solvent at the time the stock was withdrawn, went into liquidation two years thereafter, change the status of such former stockholders as creditors after the withdrawal.</p> <p>OPINION ON SUGGESTION OF ERROR.</p> <p>Building and Loan Associations. Liquidation. Rights of creditors and stockholders.</p> <p>In liquidating a building and loan association, the rights of creditors are supe