
    Michael Heslin, Plaintiff, v. The Eastern Building and Loan Association of Syracuse, N. Y., Defendant.
    (Supreme Court, Kings Trial Term,
    July, 1899.)
    1. Building association, under chap. 188, Laws of 1851—Cannot be sued for par value of shares until it has been earned.
    Where the plan under which a building and loan association, organized under chapter 122 of the Laws of 1851, issued its shares, is that they are to be paid for in monthly installments and also by crediting profits earned, and that, when both of these factors amount to the par of the shares, they shall be redeemed, a shareholder is premature in seeking to recover the par value when his payments and profits do not together equal such value, and this although the contract defines the number of his payments and he has made all of them.
    
      2. Same — 'Stipulation as to where suit must be brought.
    A condition, in the shareholder’s certificate, that any action against the association must be brought by him in the county where its principal office and place of business is will be enforced.
    The defendant was organized in 1890 under the braiding and loan association statute of this state (chapter 122, laws of 1851). The plaintiff is a shareholder of the defendant, and this is a common law action to recover $1,000, the par value of his ten shares. The certificate of the defendant to the plaintiff for such shares contains in substance an agreement that the plaintiff shall pay to the defendant monthly installments of 75 cents a share in payment therefor, and that at the end of 78 months the defendant shall pay to the plaintiff $100 for each of the said shares, provided such monthly installments shall have been paid meanwhile. It also provides that at stated intervals all profits of the defendant shall be apportioned among the outstanding shares. The profits apportioned to the plaintiff’s shares during the 78 months was $102, making the total of the 78 installments and the profits' amount to $687. It is also provided in the certificate that any action against the defendant shall be brought in the county of Onondaga, N. Y., its principal office and place of business being in the city of Syracuse in said County. The certificate also expressly makes the by-laws of the defendant a part of the contract. At the expiration of the 78 months the plaintiff, having paid the 78 installments, demanded $1,000 of the defendant for his ten shares, but payment was refused.
    Furlong <& O’Connell for plaintiff.
    D. A. Pierce for defendant.
   Gaynor, J.:

The 78 months mentioned in the certificate are an estimated period, though that is not so stated therein in so many words. The defendant’s corporate powers are limited by the statute under which it exists. It may not sell its shares for less than par under an agreement to take them back at par. That would be outside of its powers and a violation of its trust duties. Nor is it doing so. The contract between the plaintiff and the defendant has to be ascertained from the certificate issued to the plaintiff, the by-laws of the defendant, and the statutes of this state for the organization and operation of building and loan associations. From these the scheme under which the defendant issues shares for sale is found to be that they are to be paid for by monthly installments, and by the profits earned and apportioned to the shares meanwhile; such profits being retained by the defendant and credited to the purchaser. When the installments paid, plus such profits, amount to the par of the shares, they are paid for in full. As such installments and profits in this case amounted to only $687, it follows that the plaintiff made his claim prematurely. If less than 7 8 monthly installments plus the profits meanwhile had amounted to the par of the shares, the plaintiff would have had to pay only that lesser number of installments. The 78 monthly installments plus the profits not amounting to the par of the shares, they were not yet paid for, and the plaintiff had to continue to pay the monthly installments. The 78 installments were only estimated. They proved too few, but might have proved too many.

Ror do I see why the contract that the action must be brought in Onondaga County, R. Y., is not binding.

Judgment for defendant.  