One loaning money to a building associa tion to satisfy the claims of withdrawing members, taking an assignment of mortgages of borrowing members as security, cannot hold the mortgages against the claims of a receiver of the association, since he is charg ed with knowledge of the want of power of the association to make the assignment ; Standard Savings & Loan Ass'n v. Aldrich, 163 Fed. 216, 89 C. C. A. 646, 20 L. R. A. (N. S.) 393. A statute authorizing such associa tions to retire stock out of a portion of its current receipts, was held not to confer any power to give its notes to retiring stockhold ers; Appeal of Powell, 93 Mo. App. 296. Such an association may stipulate in a con tract of loan for the payment of a monthly premium limited to a certain number of pay ments; Burkheimer v. Bldg. & Loan Ass'n, 59 W. Va. 209, 53 S. E. 372, 4 L. R. A. (N. S.) 1047.
When its articles have been amended to conform to a statute providing for lower rates of interest, the association may not deny its benefits to members who have bor rowed before the act was passed on the ground that the provisions of the amended articles do not refer to pre-existing con tracts ; St. John v. Bldg. & Loan Ass'n, 136 Ia. 448, 113 N. W. 863, 15 L. R. A. (N. S.) 503.
An absolute promise to mature its shares in a specified time is not changed to a con ditional one dependent upon the success of the enterprise, by the shareholder's agree ment, as expressed in the certificate of stock, to pay a specified monthly installment on each share until it matures or is withdrawn, and the provision of the by-laws accepted by him, that such installments shall be paid un til each share is fully paid ; Eastern Build ing & Loan Ass'n v. Williamson, 189 U. S. 122, 23 Sup. Ct. 527, 47 L. Ed. 735, following Vought v. Building & Loan Ass'n, 172 N. Y. 508, 65 N. E. 496, 92 Am. St. Rep. 761, and affirming Williamson v. Building & Loan Ass'n, 62 S. C. 390, 38 S. E. 616, 1008.
The ground that such a promise on the part of the association was ultra wires was held not available 'where the shareholder had fully performed his part of the contract ; Assets Realization Co. v. Heiden, 215 Ill. 9,
74 N. E. 56; Eastern Building & Loan Ass'n v. Williamson, 189 U. S. 122, 23 Sup. Ct. 527, 47 L. Ed. 735 ; Floyd-Jones v. Anderson, 30 Mont. 351, 76 Pac. 751; Leahy v. Building & Loan Ass'n, 100 Wis. 555, 76 N. W. 625, 69 Am. St. Rep. 945 ; Hammerquist v. Savings & Loan Co., 15 S. D. 70, 87 N. W. 524.
But it has been held, where authority to issue stock having a fixed period of maturity was not expressly given by statute or by the articles or by-laws of the association, the ground of ultra. wires may be set up by the association ; O'Malley v. Building, Loan & Savings Ass'n, 92 Hun 572, 36 N. Y. Supp. 1016; McKean v. Building & Loan Ass'n, 10 Pa. Dist. R. 197 ; and to the same effect, King v. Building, Loan & Inv. Union, 170 Ill. 135, 48 N. E. 677; Schell v. Loan & Inv. Ass'n, 150 Mo. 103, 51 S. W. 406.
A stockholder who actively or passively concurs in the management of the affairs of a building association must hear his share of the losses during his membership resulting from such management ; Browne v. Sanders, 20 D. C. 455.
In considering the question of usury in a loan from a building association, payments made by the borrower as dues are not to be considered as interest, as such payments are made in order to acquire an interest in the property of the association and not for the use of money ; Tilley v. Building & Loan Ass'n, 52 Fed. 618 ; a premium bid for a loan cannot be allowed as a cloak for usury ; International Building & Loan Ass'n v. Bier ing, 86 Tex. 476, 25 -S. W. 622, 26 S. W. 39.
Fines imposed for default in payment of dues and interest cannot be collected by fore closure of a mortgage given to secure pay ment of an amount borrowed, unless it has been agreed that this may be done ; Bowen v. Building & Loan Ass'n, 51 N. J. Eq. 272, 28 Atl. 67.