A large number of these Class "A" certificates were issued. The assistant attorney general of the United States for the postoffice department having given an opinion that the scheme indicated in these certificates was a lottery, by an order of the postmaster general the mails were closed against the company,

and, under the usual rules of the department in such cases, all letters addressed to the company were stamped as fraudulent and returned to the writer. An appeal was made to the department to reverse this ruling, but the department adhered to the same, and the postmaster general refused to rescind the order closing the mails to the company. There were, at the time the present case was instituted, only seventy of these certificates outstanding, and the holder of only one of them 649 is a party to the present proceeding. It is not necessary to determine whether the scheme indicated in this class of certificates was legal. From the evidence it appears that the officers of the company, so far as they were able to do so, protected the holders of these certificates, notwithstanding their condemnation by the postoffice department, and that all the holders, except the number above referred to, have been settled with upon terms which were, so far as the present record discloses, entirely satisfactory to the holders, and that the company has in hand a fund derived entirely from receipts and investments from this class of certificates, which can and will be used, as far as practicable, in settlement with the holders of these certificates. The evidence further shows that the funds derived from this source have never been mingled with other funds of the company, nor have other funds been used in any way in the settlement or discharge of certificates of this class. We will, therefore, not pass upon the legality of the scheme indicated in this class of certificates, and will eliminate from the discussion anything in reference to this class of certificates, except so far as their history may throw light upon the legality of the schemes indicated in certificates subsequently issued. The judge did not appoint a receiver on account of the illegality of these certificates. The reason he gave for the appointment was that he thought subsequently issued certificates were illegal. If the receiver had been appointed solely on account of Class "A" certificates, the order of appointment should and would have been limited in its operation to the fund in the treasury of the company, which was set apart for the payment of these certificates. Whether there should be a receiver appointed for this fund alone has not been passed upon by the judge, and will not now be passed upon by us. Upon the refusal of the postmaster general to rescind the order closing the mails against it, the company promptly ceased to issue certificates of the class above referred to, and did all that was possible to do under the circumstances to protect those who had in good faith bought the certificates. The com

pany then issued certificates known as "Class 'B,'" a form of which is as follows:

"The Equitable Loan and Security Company of Atlanta, Georgia, hereby promises to pay to the order of

of

at its home office in Atlanta, Ga., FIVE HUNDRED DOLLARS, subject to the following express terms and conditions: 650 "1st. That the holder has paid four dollars herefor, and agrees to pay to the maker hereof at its home office, without any other or further notice, an installment of one dollar and twentyfive cents on the fifth day of each and every succeeding month hereafter, until one hundred and sixty-eight installments shali have been thus paid, time being of the essence of this contract, then this certificate shall become due and payable for its full face value.

"2nd. That the holder hereof shall surrender for payment and cancellation this certificate whenever the same shall be called, before maturity, upon the payment to him of its then redemption value, which value shall be the full amount of the first payment, and all installments paid hereon, with interest on said amount at the rate of eight per cent. per annum, and its proportionate share of all dividends or accumulations from fines, lapses, and interest earned in excess of eight per cent per an

num.

"3rd. That, in order to prevent favoritism or partiality being shown by the company, certificates paid before maturity shall be paid by numbers, and only according to the multiple table which is printed on the back hereof, which table is hereby referred to and made a part of this contract.

"4th. That of each and every installment paid as aforesaid the maker hereof shall place fifty per cent. and all net receipts from fines to a redemption fund, which may used: (a) For paying off certificates prior to their full maturity term, according to the terms above set forth. (b) For paying certificates in the order and manner that they shall mature at the end of the full term. (c) For paying to the legal representatives of any deceased holder hereof the full amount of the first payment, and all installments paid hereon, with interest at the rate of eight per cent. per annum, and its proportionate share of all dividends or accumulations from fines, lapses, and interest earned in excess of eight per cent per annum; provided, this certificate is in good standing, and legal and sufficient notice of such death is furnished the maker hereof within sixty days after death occurs, or fines will be enforced as provided for in

section 5th hereof; and provided further, that if the holder hereof at the date of this certificate was more than fifty years of age, that the said legal representatives of such deceased shall not have the right to surrender this certificate for payment upon conditions above set forth, and the maker hereof can not be required to pay the same 651 under this section hereof, but will issue in lieu hereof a paid-up certificate for the amount of installments that have been paid hereon, with four per cent. per annum interest, according to the provision regulating paid-up certificates in section fifth hereof, or this certificate may be continued as though death had not occurred; and thirty per cent. to a reserve fund which shall be used and held for the protection of all live outstanding certificates; and the remaining twenty per cent. and all transfer fees shall be used for the expenses of the company.

“5th. That a failure to pay said installments when due subjects the holder hereof to a fine of fifty cents each month for each and every installment in arrears, and if any installment or fine shall remain unpaid for six months, then this certificate shall become null and void, and of no value, and the holder hereof shall and does forfeit all payments and fines made hereon. Provided, that, at any time after eighty-four monthly installments have been paid hereon, the holder may surrender this certificate, if it is in good standing, and receive for it a new, nonassessable, and non-forfeitable certificate for the amount of installments that have been paid hereon, with interest at the rate of four per cent. per annum, which new certificate shall bear the next unsold number, and shall bear interest at the rate of four per cent. per annum, and be payable on or before the expiration of the tontine period from the time it is then issued.

"6th. That the entire assets of this company shall at all times be liable for the full payment of all obligations incurred in its certificates.

"th. That the funds of this company may be loaned to the holders of certificates, upon terms and security to be approved and accepted by the board of directors.

"8th. That no part of the reserve or redemption funds can ever be loaned to any officer or director of this company.

"9th. That no transfer hereof shall be valid or binding on the maker until it has been approved by the directors and recorded on the books of the company at its home office, and a fee of one dollar paid for making such record. Each and

every transferee hereof accepts this certificate subject to all the stipulations herein.

"10th. That no officer or director of this company, or any member of his or their families can purchase or own this certificate.

"11th. That no statement made by anyone except as herein set forth shall be binding on this company.

652 "In witness whereof this company has caused this certificate to be executed in its name and behalf under its corporate seal by its president and secretary." (Dated and signed.)

The multiple table referred to in this certificate is the same as that which appears upon the back of certificates of Class "A." The scheme of the company as indicated in these certificates was approved by the assistant attorney general of the United States for the postoffice department, and from the time it began to issue these certificates the company had the same unrestricted right to the use of the mails as any person engaged in a lawful business. Whether the certificates of Class "A" were legal or illegal it is to be said to the credit of the company and its officers that they abandoned the use of the same as soon as the authorities of the postoffice department had declared them to be illegal and did not issue any other form of certificate until the same had been approved by the law officer of that department. These facts indicate that it was the intention of the officers of the company at all times to obey the law of the land and to heed the voice of its authorized officials.

Is the scheme of the company as indicated in certificates of Class "B" of such a character that it must be declared unlawful, violative of sound public policy, and calculated to defraud? Let us first look at the scheme as indicated by the certificate, independently of other evidence throwing light upon the character of the contract. The certificate is an obligation on the part of the company to pay to the holder the sum of five hundred dollars, subject to the terms and conditions named in the certificate. Is it reasonably probable that the scheme indicated by these certificates can be carried into execution? While it does not appear in terms in the certificate, the fact is, as admitted, that the four dollars paid by the certificate holder is allowed the agent obtaining the certificate as a fee, and that this sum does not go into the treasury of the company. Twentyfive cents of each monthly installment is set apart for expenses. It is therefore to be determined whether it is reasonably probable that the company can legitimately realize with the monthly