Upon the whole case, we perceive no error prejudicial to the substantial rights of the defendant, and the judgment must be affirmed.

MANHEIMER v. HENDERSON BUILDING & LOAN ASS'N'S ASSIGNEE. (Court of Appeals of Kentucky. March 3, 1903.)

BUILDING AND LOAN ASSOCIATIONS-INSOLVENCY-STOCKHOLDERS-CREDITORS.

1. The fact that a stockholder in an insolvent building and loan association paid in advance all premiums and dues assessed on her stock, or that she gave notice of withdrawal before the assignment, could not alter the relation of the parties as fixed by the law; nor could the fact that her claim had been merged into a judgment change her status as a stockholder, or give her preference over other stockholders, but the only effect of such judgment was to fix definitely the amount on which she would be entitled to receive her pro rata after the debts were paid.

2. Where a stockholder in an insolvent building and loan association did not actually loan it any money, the fact that the amount due on her stock remained in the hands of the association, after demand made for its payment, and until the assignment, did not make it a borrower of the money so as to entitle her to a preference over other stockholders, but she remained a stockholder only.

Appeal from circuit court, Henderson county.

"Not to be officially reported."

Action by Theresa Manheimer against the Henderson Building & Loan Association's Assignee. Judgment for defendant, and plaintiff appeals. Affirmed.

Yeaman & Yeaman and J. M. Hartfield, for appellant. M. Merritt, for appellee.

SETTLE, J. On April 25, 1901, the Henderson Building & Loan Association, of Henderson, Ky., being insolvent, executed a deed of assignment to the appellee, C. G. Henson, whereby all of its property of whatsoever kind was conveyed to him, in trust for the payment of its debts; and the assignee thereafter, on April 26, 1901, instituted suit in the Henderson circuit court for a settlement of the trust. The appellant, Theresa Manheimer, owned eight shares of the stock of the association mentioned, of $100 per share, upon which she had paid to the association prior to February, 1901, the entire amount due thereon. On April 26, 1901-the same day on which appellee, as assignee of the association, filed his suit for a settlement of its affairs-appellant brought suit in the same court against the association for the sum and interest alleged to be due her on her stock, and which it was claimed by her the association had recognized as due, and promised to pay. At the May term, 1901, of the court, she obtained a judgment against the association for the sum of $800 as due on her stock, with interest from February 28, 1901,

1. See Building and Loan Associations, vol. 8, Cent. Dig. 88.

and costs. In the meantime the assignee in his suit for a settlement had procured an order referring his case to the master commissioner for a report as to the indebtedness of the association, and appellant, among others, filed her claim with the commissioner, which was in the form of a copy of the judgment obtained by her, accompanied by this statement: "Claimant filed this claim as borrowed money by the association, and not on account of shareholder; the within money being borrowed by the said association." Later the commissioner filed his report, wherein appellant's claim was allowed, not as that of a creditor, but a stockholder. Appellant filed exceptions to so much of the report as refused to recognize her as a creditor, and her exceptions were, at the January term, 1902, of the court, overruled, it being adjudged by the lower court that appellant "stand in the same attitude as other stockholders of said association until its indebtedness is paid," and from that judgment she prosecutes this appeal.

We find, therefore, that the only question submitted for the decision of this court is whether the appellant is a creditor or stockholder of the Henderson Building & Loan Association. Unfortunately for appellant's contention, the question involved has been too frequently settled by former adjudications of this court to admit of further controversy. The most recent deliverance of this court on the question is found in the case of Vinton v. Nat. Building & Loan Association (Ky.) 66 S. W. 510, in which it was held that a stockholder in a building and loan company is not entitled to credits for stock payments made, or to the withdrawal value of the stock, where same remained with the company unsettled at the time the company became insolvent. In stating the reasons for the rule mentioned, the court, in the case supra, say: "In insolvent concerns it is to be assumed that there has been an impairment of the capital stock, growing out of losses in the conduct of the business, and the value of the stock can be determined only when the losses are ascertained, and the funds ready for distribution; and we are of opinion that the mere date of an application for withdrawal of stock presents no bar to the right of other stockholders to insist, through the assignee or the receiver, upon the subjection of payments to stock account to the payment of proportionate amounts of the losses and expenses of the concern. To hold otherwise would be to lend the aid of the courts to the placing of a disproportionate part of this burden upon the borrowing member, the class for whose benefit the law is supposed to have been designed, and who, as their stock is in pledge to the association, cannot apply for its withdrawal. So long as the stock payments remain in the hands of the association, no matter what the date of the application for withdrawal, they remain subject to this burden." In Reddick v. Unit

ed States B. & L. Association (Ky.) 49 S. W. 1075, it was held that a member of a building and loan association, by giving notice of withdrawal of his stock before assignment made for the benefit of creditors of the association, did not, under the law governing such associations, acquire a priority in the distribution of the assets of the association. The following additional authorities will be found to fully sustain the doctrine announced by the cases supra, viz.: Forwood v. Eubank, Assignee (Ky.) 50 S. W. 255; Sumrall

V.

Commercial Building Trust's Assignee (Ky.) 50 S. W. 69, 44 L. R. A. 659; Cook on Stock and Stockholders, section 12. The uniform rule, as declared in all of the foregoing authorities, is that, after the assignment of a building and loan association, all stockholders are upon an equal footing. The fact that appellant paid in advance all premiums and dues assessed upon her stock, or that she gave notice of withdrawal before the assignment, cannot alter the relationship of the parties as fixed by the law; nor does the fact that her claim has been merged into a judgment change her status as a stockholder, or give her preference over other stockholders. The only effect of the judgment was to fix definitely the amount upon which she will be entitled to receive her pro rata after the debts of the association are paid. It is not claimed by the appellant that she actually loaned the association any money, and the fact that the amount due on her stock remained in the hands of the association after demand had been made for its payment, and until the assignment, did not make it a borrower of the money. Therefore the written statement accompanying the claim filed by her with the commissioner, in which the association was denominated a borrower of her money, inaccurately expressed the relationship of the parties. She still remained and was only a stockholder; nothing more.

We are of the opinion that the lower court did not err in overruling appellant's exceptions to the commissioner's report, and the judgment is therefore affirmed.

CITY OF CAMPBELLSBURG ▼. ODEᎳᎪᏞᎢ .

(Court of Appeals of Kentucky. Feb. 20. 1903.)

INTOXICATING LIQUORS-WRONGFUL SALESPOSSESSOR OF PREMISES-LIABILITY-CITY ORDINANCE-VALIDITY-BILL OF RIGHTS.

1. A city ordinance provided that any person in possession of premises in the city on which liquor is sold, disposed of, obtained, or furnished, in violation or evasion of law, by any trick or method whatever, on conviction shall be fined, etc., for each time such liquor is sold, disposed of, or furnished in violation or evasion of law. Held, that since such ordinance makes the person in possession of premises responsible for an act not committed by him and which he had no intention to commit, and to a prosecution for which he could make no defense, it was in violation of Bill of Rights, § 2, prohibiting

the exercise of absolute or arbitrary power over the liberty and property of citizens.

Hobson, O'Rear, and Settle, JJ., dissenting. Appeal from circuit court, Taylor county "Not to be officially reported."

Action by the city of Campbellsburg against Jacob Odewalt to recover a fine for violation of city ordinance. From a judg. ment in favor of defendant, plaintiff appeals. Affirmed.

H. W. Rives and H. C. Wood, for appellant.

PAYNTER, J. The appellee was arrested under a warrant which charged that "on the 22d day of September, 1900, in the county aforesaid, the said Jacob Odewalt was there and then in possession of premises on which liquor was sold to one Thomas G. Newton, contrary to the form of the statute in such cases made and provided." It was based upon an ordinance which reads as follows: "Be it enacted by the board of council for the city of Campbellsville, Ky.: That any person in possession of the premises in the city of Campbellsville, Ky., on which liquor is sold, disposed of, obtained or furnished in violation or evasion of law by any trick or method whatever on conviction shall be fined not less than twenty dollars ($20.00) nor more than one hundred dollars ($100.00) for each offense, and each time such liquor is sold, disposed of or furnished in violation or evasion of law is a separate offense." The ordinance does not denounce a penalty for selling liquor in violation of law. The warrant was obtained upon the affidavit of Thos. G. Newton, the party to whom it is alleged the liquor was unlawfully sold. It does not charge the appellee with selling liquor, but the charge is that "said Jacob Odewalt was then and there in possession of the premises on which the liquor was sold." The evidence offered is to the effect that Newton, in a back room of the appellee's store, bought from an unknown party some whisky and beer. There was no evidence showing that the party from whom Newton bought it had any connection whatever with the appellee in a business way or otherwise, or that the appellee even knew him, or that he had ever been in the store previous to or since that time. The court below gave a peremptory instruction to the jury to find for the appellee, which was accordingly done. The case is not briefed by counsel for appellee, but in the brief for appellant it is stated that the court sustained the motion for peremptory instruction upon the ground that the ordinance in question was unconstitutional. This is a most unusual or dinance. It makes the party in possession of the premises responsible for an act that he never had an intention to commit; for an act that he did not do himself; for an act that might have been done by another, not in his presence, but without his knowledge or consent. No presumption of innocence

can be indulged; no defense can be made to the prosecution, although he may not have had an intention to commit the offense, although he never was guilty of an act in violation of law, and although he had no knowledge that others were engaged in the violation of law upon his premises. Under this ordinance parties could enter upon the yard of a citizen at midnight, when he was asleep, sell liquor in violation of law, and in consequence of which a fine could be imposed upon the party in possession of the premises. A practical illustration of what might be done under the ordinance is furnished by this case. Newton testified that he bought it from a party unknown to him. He then swore out a warrant for the appellee. Appellee cannot contradict Newton, because he fails to give the name of the alleged seller. If the ordinance is valid, appellee must suffer the imposition of the fine with practically a denial of the right to defend himself against the charge. If a legislature or common council of a municipality can enact such a law as this, and it is valid, they could enact a law which would compel an occupant of premises to pay all kinds of fines and submit to all kinds of impris onment for all kinds of offenses which might be committed upon his premises without his knowledge or consent. While a zeal to punish persons who sell liquor in violation of law is commendable, yet it must be confined to the enactment and enforcement of laws which do not arbitrarily deprive citizens of their liberty and property. Section 2 of the Bill of Rights reads as follows: "Absolute and arbitrary power over the lives, liberty and property of freemen exists nowhere in a republic, not even in the largest majority." We cannot conceive of a greater attempt at the exercise of arbitrary power than in the enactment of the ordinance in question. Under that ordinance a citizen's liberty and property can be taken, although he has done no act in violation of law, or even had an intention to do so. The exercise of the same arbitrary power might deprive a citizen of his life, because, if this ordinance is valid, a law might be enacted of the same character that would deprive one of his life, although he was not present, and although he did not commit a wrongful act, or have any knowledge that one was about to be committed. The ordinance in question is quite different from one which would impose a fine upon one in possession of premises for suffering or permitting liquor to be sold thereon. To interpolate words to describe that offense would be, in effect, adopting a new ordinance. The offense under such an ordinance would not be for being in possession of premises upon which the wrongful act was committed, but for the act of suffering or permitting the wrongful act of another to take place on his premises. Such an ordinance would denounce a penalty for an act which the ordinance declared

to be wrong, while the ordinance in question in effect makes one guilty of the wrongful act of another. Our opinion is that the ordinance in question is unconstitutional.

"A

It is suggested that the peremptory instruction should not have gone, as the proof tended to show that appellee was in possession when the selling took place, and therefore the burden shifted to him to show that he had no knowledge of it. The ordinance was not enacted as a rule of evidence, and to determine its effect, but to define an offense. If it were proper to interpret the ordinance in question as we would one that complied with the constitutional requirements, then the peremptory instruction should have gone, because the evidence detailing the circumstances under which it was sold would rebut the charge that he suffered and permitted it to be sold. Bishop on Statutory Crimes, section 132, reads as follows: statute will not generally make an act criminal, however broad may be its language, unless the offender's intent concurs with his act, because the common law does not. Hence what is done from overwhelming necessity is construed as not violating a statute, however contrary to its general terms. And one who, while careful and circumspect, is led into a mistake of facts, and, doing what would be in no way reprehensible were they what he supposes them to be, commits what, under the real facts, is a violation of a criminal statute, is guily of no crime, because such is the rule of the common law, and in construction it restricts the statute. Yet in some instances of this sort he incurs a civil liability." It is suggested that to follow the doctrine of this section would lead us to hold the ordinance valid. It is difficult to see what this has to do with the case under consideration. The first part of it is to the effect that at common law it was essential to show the intent of the alleged offender, and that statutes do not generally make a criminal offense, unless the offender's intent concurs with his act. To enforce the ordinance in question it is necessary to interpolate words describing an act for which a party may be prosecuted, as well as an intention to commit it. In the next clause of the section it is stated that, where an act is the result of "overwhelming necessity," it is construed as not violating a statute, however contrary to its general terms. This is not a case for the application of such a principle, because it is not contended that any act was done in this case as the result of "overwhelming necessity." Again, the section says, "And one who, while careful and circumspect, is led into a mistake of facts, and, doing what would be in no way reprehensible were they what he supposes them to be, commits what, under the real facts, is a violation of a criminal statute, is guilty of no crime." We are wholly unable to see the remotest application that this principle has to the case under consideration. There

is no evidence here that the appellee was led to do an act as the result of a mistake of facts.

It is suggested that certain rules of interpretation, if followed, would lead to the holding of the ordinance in question as valid. One of these rules is that every statute ought to be expounded not according to the letter, but according to the meaning; and another is that every interpretation which leads to an absurdity ought to be rejected; and, again, that a law ought to be interpreted in such manner as that it may have effect, and not be vain and illusive. There is no occasion for the application of the first rule of interpretation mentioned, because we have interpreted the statute according to its letter and spirit, and condemn it because in its spirit and letter it is violative of the Constitution. This is no occasion for the application of the second rule, because the interpretation we have given the ordinance does not lead to an absurdity. If it is enforced according to the word and spirit, it would be neither vain nor illusive, but it would be so drastic and effective as to deprive the citizen of his liberty and property. Again, it has been suggested that the reason of an enactment must enter into its interpretation, and that a case within the letter, but not within the spirit, of a statute, is not embraced by it. This is not a case for the application of that rule, because the party was in possession of the premises when the sale took place, and, if it is an offense, it is not only within the letter, but within the spirit, of the ordinance. Section 460, Ky. St., provides that "all words and phrases shall be construed and understood according to the common and approved usage of language." There is no question as to the words and spirit of the ordinance. No word is used of doubtful import, and no phrase is employed of uncertain meaning.

The logic of those who oppose the views herein expressed is to have the court enact an ordinance that would not be subject to a constitutional objection, give it a retroactive effect, and declare the appellee has violated it. The business of the court is to interpret, not enact, laws.

The judgment is affirmed.

HOBSON, J. (dissenting). The by-law before us in this case is taken from section 2572, Ky. St., which is in these words: "The person in possession of the premises on which liquor is sold, disposed of, obtained or furnished in violation or evasion of law by any trick or method whatever on conviction shall be fined not less than twenty nor more than one hundred dollars for each offense, and each time such liquor is sold, disposed of or furnished in violatica or evasion of law shall be deemed a separate offense under this act against the person in possession of the premises on which said liquor is obtained, furnished or disposed of." The by-law, merely following the statute, is not void, unless the

statute is also invalid; for it cannot, of course, be maintained that the town authorities could not make a by-law similar to the statute, to secure its better enforcement. It is said that the language used is broad enough to make the owner of the premises guilty criminally if a tramp walking by should step off the highway and sell whisky on his land, and other similar illustrations are given. But the statute requires no such rigorous construction. It will be observed that the statute uses the words, "in violation or evasion of law"; also the words, "under this act." The act was approved February 24, 1894, and is entitled "An act to punish the violation and evasion of the laws of this commonwealth in relation to the regulation of the sale of spirituous, vinous or malt liquors." See Acts 1894, p. 33. Every section of the act strikes at tricks, subterfuges, or devices for the evasion of the laws against liquor selling. The Legislature knew that in local option communities blind tigers were frequently run by irresponsible persons, here to-day and gone to-morrow; while the owner of the property could be more easily found; and the purpose was to prevent the evasion of the law. The statute was aimed at those who evaded the law, and not at those whose premises might be used for a moment by some tramp without their knowledge. This construction not only harmonizes the section quoted with the general intent of the act as shown by its title and other provisions, but is in accord with the principles of common law. In Bishop on Statutory Crimes, section 132, it is said: "A statute will not generally make an act criminal, however broad may be its language, unless the offender's intent concurs with his act, because the common law does not. Hence what is done from overwhelming necessity is construed as not vio lating a statute, however contrary to its general terms. And one who, while careful and circumspect, is led into a mistake of facts, and, doing what would be in no way reprehensible were they what he supposes them to be, commits what, under the real facts, is a violation of a criminal statute, is guilty of no crime, because such is the rule of the common law, and in construction it restricts the statute. Yet in some instances of this sort he incurs a civil liability." In Bailey v. Commonwealth, 74 Ky. 691, this court said: "Words in a statute were always to be understood according to the approved use of language. But there are other rules of construction of equal dignity and importance, which must not be overlooked, and which, although not incorporated in our Statutes, are as binding upon the court as if embodied in it. One of these rules is that every statute ought to be expounded, not according to the letter, but according to the meaning; and another, that every interpretation that leads to an absurdity ought to be rejected; and still another, that a law ought to be interpreted in such manner as that it may have

effect, and not be found vain and illusive." Following this principle, it has been held that the reason of an enactment must enter into its interpretation, and that a case within the letter, but not within the spirit, of a statute, is not embraced by it. Brown v. Thompson, 77 Ky. 538, 29 Am. Rep. 416. And to sustain a statute, and give it effect, the court read the statute as though the word "width" was the word "depth." Bird v. Commissioners, 95 Ky. 195, 24 S. W. 118. The case before us does not require us to go further than the common-law rule quoted above from Bishop on Statutory Crimes. The Legislature had in mind evasions of the liquor laws, and was aiming to punish those who evaded them. Where the liquor is sold on the premises of another, without his knowledge or consent, or under circumstances beyond his control, or not reasonably to be anticipated by him, he is not to be punished. This gives the statute a fair effect. It remedies the evils the Legislature had in mind, and it is the duty of the court, if it can do so, to enforce the legislative will, and not render the statute vain and illusive. By section 1130, Ky. St., a person convicted a second time of felony shall be confined in the penitentiary not less than double the time of the first conviction, and if convicted a third time, during his life. Yet under this statute it was held that the increased penalties only applied to offenses committed after the former conviction. Brown v. Commonwealth, 100 Ky. 127, 37 S. W. 496. In holding this the court had only to guide it the legislative intent, without any expressions in the statute indicating it. The case here is much stronger, for the phraseology of the statute, as well as its title, shows that the Legislature was aiming at only evasions of the law. It has been held a violation of the statute to carry a pistol concealed in a valise; but if a person, walking with a friend, carried his valise for him, not knowing there was a pistol in it, he would clearly not come within the purpose of the statute against carrying concealed deadly weapons. Similar illustrations may be given as to nearly all the statutes declaring certain specific acts misdemeanors. To say that the principle stated by Bishop applies to acts done by the defendant, but not to a case like this, is to ignore the principle on which the rule rests; which is that there is at common law no criminality where the defendant acts innocently, and there is no fault on his part, actual or constructive.

The evidence in this case proved the facts set out in the statute, and therefore made out a prima facie case against the defendant. It was one of those cases within the letter, but not within the spirit, of the statute, as above indicated. The burden of proof was on the defendant to show it, and the court should not, therefore, have instructed the jury peremptorily to find for the defendant. In Bishop on Statutory

Crimes, section 1022, it is said: "Where the statute is silent as to the defendant's intent or knowledge, the indictment need not allege, or the government's evidence show, that he knew the facts. His being misled concerning it is matter for him to set up in defense and prove." A number of authorities from other states are cited in support of this principle, and there are many familiar illustrations of it. A mistake of the person or ignorance of a subsisting marriage will, under some circumstances, be a defense to an indictment for adultery; but such things need not be anticipated by the state, and must be shown by the defendant. The same is true of the crime of incest, where the defendant may show ignorance of the relationship in defense. There being no proof here rebutting the prima facie case made out by the state, the court should, in my judgment, have submitted it to the jury. The question is not, therefore, presented how far the Legislature, in the exercise of the police power, may, by small and reasonable penalties, provide for those things which tend to the repression of violations of law, as, in its discretion, the exigencies of the case require. See Purnell v. Mann, 105 Ky. 87, 48 S. W. 407, 49 S. W. 346, 50 S. W. 264. Of course, it is conceded that excessive fines and cruel punishment cannot be inflicted. Const. 17. I therefore dissent from the judgment of the court.

ATTACHMENT-GROUNDS FOR ISSUING-FRAUDULENT DISPOSITION OF PROPERTY.

1. Testimony that B., against whom A. had instituted a suit for damages, had told a third party, a few days before A. sued out his writ of attachment, that he was in trouble, and wanted to dispose of his property, etc., together with B.'s admission that, if he could have sold the property and got the money for it. he would not have paid A. anything, as he did not consider his claim a just one, showed that B. was endeavoring to defeat any judgment which might be obtained against him, and warranted the issuing of the attachment.

Appeal from circuit court, Marshall county. "Not to be officially reported."

Action by the commonwealth against John A. Sprague and others. Judgment rendered fixing the rights of the various parties, and, among other things, discharging an attach