Rhoads v. Hoernerstown Building & Savings Ass'n , 1876 Pa. LEXIS 214 ( 1876 )

Mr. Justice Paxson

delivered the opinion of the court, October 9th 1876.

The Hoemerstown Building and Savings Association was incor.porated by the Court of Common Pleas of Dauphin county in the the year 1869.- The petition for the charter was signed by three citizens only, and the decree'of the court sets forth that the persons who have signed the application, and their successors, shall, according to the articles and conditions set forth in the application, become a corporation or body politic, &c. The company subsequently commenced business under its charter, and sued out a writ of scire facias upon a mortgage of $1000, given by Frederick E. Rhoads, plaintiff in error, and a member and shareholder of said corporation, to secure a loan of money made to. him by the latter. Mr. Rhoads ceased paying his interest and dues in February 1878, whereupon the •association commenced these proceedings in the court below, and upon the trial claimed the powers and privileges of a building association under the Act of 1859. The sum of $809.90 was demanded as the amount due upon the mortgage. This claim was resisted by the defendant below, upon the ground that the said association was not incorporated under the Act of 1859; was not entitled to exercise the powers specified in said act, and could only recover the amount actually loaned, with interest. The main point in the case, therefore, is the extent of the powers of the association under its charter. The validity of its charter is not questioned; indeed, could not be in this collateral proceeding.

That this association was not incorporated under the Act of 1859 is manifest. Said act (Pamph. L. 544) provides, that when any ten or more persons may desire to form a mutual savings fund, loan or building association, under the provisipns of said act, they shall make application to the Court of Common Pleas, &c. No authority is given to said court to incorporate any number of persons less than ten for such purpose. As before observed, the application for this charter was signed by but three persons, and the decree of the eourt, by its express terms, confers the corporate privileges upon the petitioners and their successors. We will not assume that so experienced a court as the Common Pleas of Dauphin' county intended to confer upon three persons the rights and powers embraced in the Act of 1859. An examination of the charter itself shows that ■ many of its important provisions are inconsistent with the Act of 1859, if not in direct conflict with it.- No limitation upon its own existence is contained in this charter, nor is any such limitation to be found in the decree of the court. The first section of the Act of 1859 declares, “ that no charter granted under or' by virtue of the provisions of this act be for a longer period than twenty years.” Shareholders in this association can withdraw only upon “ good and sufficient cause shown, of which the bpard of directors shall be the judges,” while stockholders in associations under the Act of 1859 have the absolute right to do so by giving thirty days’ notice of his or her intention to withdraw. (Sec. 2.) Again, associations under the Act of 1859 have no power to purchase and hold real estate, unless they have a previous lien upon or interest in it, where they may purchase the same, if necessary, to protect the interests of the association. (Sec. 9.) The directors of this association are “ empowered to purchase ground and erect or build dwellings, or may purchase such property as they may think prudent for the association, which may be offered to the shareholders for their share.” Other and-, striking points of'dissimilarity might be noticed between the powers contained in this charter and those conferred by .the Act of 1859. What has been said is sufficient to show that it was.not granted under said act. The court below appears to have felt the strain of this part of the case, and avoided it by saying: “ This is a question of little practical importance in this case. The court had ample power, under the Act of April 22d 1850, extended to Dauphin county by Act of May 7th 1855, to grant the charter upon an application as prescribed by the 13th section of the Act of October 13th 1840. The 8th section of the Act of 1859 covers this case. The loan having- been made subsequently to the passage of that act, the law can in no sense be open to the charge of mere arbitrary legislative interpretation. In its application it is not retroactive.” If the premises assumed by the court below be right the conclusion is not inaccurate.

Prior to the Act of 1859 our legislation in regard to building associations was mere patchwork. The Act of 13th of October 1840 (Pamph. L. 5) makes no mention of building societies. It refers to associations for literary, charitable and religious purposes, beneficial societies, fire engine or hose companies. The Act of 22d April 1850 (Pamph. L. 550) extended the Act of 1840 to “ mutual savings funds, land and building associations.” The Act of 1850 was local, being confined to the counties of Philadelphia, Schuylkill and Berks. The Act of May 7th 1855 (Pamph. L. 481) extended it to Lehigh, Northampton and Dauphin. By various other acts not necessary to enumerate, it was extended to some other portions of the state. But it never became a general law. Then came the Act of 12th April 1859 (Pamph. L. 544), referring in its preamble to the Act of 1850 and its supplements ; reciting the fact that said act and its supplements had been extended over several of the counties of the state; that the authority thus conferred had “ been freely exercised, and by such encouragement, and by allowing members of said associations to adopt such constitutions or articles of association as to them might seem most beneficial, and by allowing parents to sign the constitutions for and on behalf of their minor children, a large and constantly increasing interest has been created, such associations affording to the indigent an opportunity to safely and profitably invest their earnings, thus inducing the people to form habits of economy and self-denial by ' setting apart periodically a portion of their earnings, enabling them to purchase or build their own homes, increasing the number of small real estate owners, and thereby enriching and strengthening the Commonwealth,” &c. The act then proceeds to provide “ that at any time when ten or more persons may desire to form a mutual savings fund, loan or building association * * * they shall make application to the Court of Common Pleas of the proper county,” &c. The 8th sect, makes valid all. charters previously granted under the Act of 1850 and its supplements, and provides that the premiums taken by such companies shall not be deemed usurious. There are no words in the Act of 1859 by which the Act of 1850 was expressly repealed. It is clear, however, that it was intended to supply it. The Act of 1850, as before observed, was local; The Act of 1859 is a general law, extending over the entire state, and legislating upon the same subject. The 8th sect, conferred upon all building associations previously char.tered, all essential rights and powers which' could be given to associations afterwards chartered under the Act of 1859, thus placing all these corporations practically upon the same footing. Surely the legislature could not have intended after thus disposing of the whole subject by a general law, to continue in force the local laws then in existence, and which if left to remain could only lead to confusion. It was clearly the intention of the law-making power that after the passage of the Act of 1859; all applications for charters of building associations should come under its provisions, and should be made by not less than ten persons, else we should have the anomaly of one law requiring such application to be made by not less than ten persons, and another law authorizing it to be made in many portions of the state by any number less than ten. The legislature having by the Act of 1859 revised and passed upon the whole subject, we think the reasonable construction of said act is that the Act of 1850 is repealed by implication, leaving all rights acquired and charters granted under said act to remain as they were previously to the passage of the Act of 1859, excepting in so far as certain additional powers were conferred upon them by said last-named act. It was held in Johnston’s Estate, 9 Casey 511, that “ a subsequent statute, revising the whole subject-matter of a former one, and evidently intended as a substitute for it, although it contains no express words to tjiat effect,, must, in the principles of law,' as well as in reason and common sense, operate to repeal the former.” To the same effect is Bartlet v. King, 12 Mass. 545; King v. Cator, 4 Burr. 2026 ; King v. Davis, 1 Leach’s Cases 306. Says Lowrie, C. J., in Nusser v. Commonwealth, 1 Casey 126, “ where the prior enactment is local and the new one general in its operation, the maxim (that a subsequent statute is a repeal of all repugnant provisions in a prior one) applies with undiminished force; because the whole includes the several parts, and all local laws establishing one rule for one portion of the community, and a different one for the remaining portion, are inconvenient and of doubtful propriety except where they relate to matters which are local in their nature, and ar'e enacted by the proper municipal authorities of the territory over which they are designed to operate.” In Gwinner v. The Lehigh & Delaware Gap Railroad Co., 5 P. F. Smith 126, it Avas said by Justice Agnew that “ acts Avhich, although in pari materia, grant a right conditioned on different things, are inconsistent, and the inconsistency operates as a repeal.”

We are of opinion that this corporation was not incorporated under the Act of 1859,, and that the Act of Í850 and its supplements were repealed by the passage of the former act. It follows that it cannot derive any support from the Act of 1859, and that in this suit it can only recover the amount of money actually loaned with legal interest. We are not bound to pursue the subject further. The Act of April 12th 1867 (Pamph. Xi. 70) may possibly sustain the charter of this corporation as a savings fund association. No such question is before us and we will not speculate.

Judgment reversed, and a venire facias de novo awarded.