Johnston v. Elizabeth Building & Loan Ass'n , 1884 Pa. LEXIS 18 ( 1883 )

The opinion of the court was delivered January 7th 1884, by

Mr. Justice Paxson.

The evidence, the rejection of which forms the subject of the first assignment of error, was clearly incompetent. The tendency and object of it was to iifipeach the charter of the plaintiff corporation.' That- this cannot be done in a collateral proceeding has been so often decided, that a reference to the authorities is almost needless. It is sufficient to refer to Spahr v. The Bank, 13 Norris 420, which is one of the later cases. Rhoads v. Hoernerstown B. & L. Association, 1 Norris 180, has no application.

The second, third and fourth assignments of error may be dismissed with the remark that there was neither evidence, nor even an offer to show, that the secretary had any authority to bind the corporation by any such admission as is there stated. Moreover, the admission could only be held to apply to a payment made voluntarily and pursuant to the charter and by-laws, and not to the amount collectible on the foreclosure of the mortgage. The difference in result where a borrower pays up his stock to the end, and a defaulting borrower, was pointed out in Watkins v. The Building Association, 1 Out. 514, and need not be here repeated. So also Gass v. Citizens’ B. & L. Association, 14 Norris 101.

The fifth assignment is equally without merit. The proposition was that the loan was made to Penny; that Johnston became surety for him by giving the mortgage in suit, and that the association required Penny to transfer the stock to Johnston. Conceding all this to be so it does not affect the case. Both Penny and Johnston were members, one member had the right to become surety for another and we are wholly unable to see how that circumstance affects the contract. Gass v. Citizens’ B. & L. Association, supra, was the case of a surety, and there is nothing in the building association lavq nor in the charter of the plaintiff company, that makes it the duty of the association to inquire for what purpose loans are being obtained, or to require any stipulation from the borrower as to the use he shall make of the money: Juniata Building & Loan Association v. Mixell, 3 Norris 313.

The sixth assignment is ruled by Selden v. Reliable Savings & Building Association, 32 P. F. S. 336, and need not be discussed.

The seventh assignment alleges that the court below erred in excluding evidence that the plaintiff association, after the giving of the mortgage sued on, suspended business fora period of some length. If the fact be so, the defendant below was not injured. lie was a member. The action of the association was in part his, and was evidently for the purpose of a temporary relief from the burdens imposed upon all. The only effect was to prolong the period of winding up the affairs of the association. The defendant would be in the precise position in the end as if the suspension had not taken place.

Judgment affirmed.