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property was by said trustee sold pursuant to the terms of said deeds of trust, to Lorenzo E. Anderson, the highest and best bidder, for $13,100, which sum was thereafter received by the trustee from Anderson, and the trustee executed and delivered to him his deed to the said Bremen avenue property; that the trustee paid out of the proceeds of said sale the charges, costs and expenses connected with the execution of his trust, the amount due the association under the said $13,000 deed of trust, and under the said $3,000 deed of trust, leaving a balance in his hands of $15.57.

The second count, after generally denying the allegations of the petition, sets up the same state of facts 23 as alleged in the first count heretofore recited, and concludes as follows:

"Defendant says that said Anderson bought in good faith, and for the actual consideration named, to wit, $13,100, and neither this defendant nor the said trustee had any interest directly or indirectly in said purchase. This defendant says that the said trustee paid out of the proceeds of the sale the charges, costs and expenses connected with the execution of his trust, and the amount due this defendant under said $13,000 deed of trust, and the amount due to it under said $3,000 deed of trust, leaving a balance in his hands of $15.57.”

Joseph P. Hartnett filed a separate answer, and after a general denial pleaded as new matter that he was named as trustee in the deeds of trust mentioned in plaintiff's petition, and that there having been default made by McDonnell under the $13,000 deed of trust, he was requested by the association, the holder of the bond secured by said deed of trust, to advertise and sell the property described therein; that on the twentythird day of June, 1899, he proceeded to advertise said property for sale in the “St. Louis Star"; that said advertisement was continued in said paper for twenty days, and upon the day advertised to be the day of sale, which was July 18, 1899, he sold in accordance with the requirements of said deed of trust and said advertisement, the property therein described, at public venue, to the highest bidder, at the east front door of the courthouse in the city of St. Louis, and Lorenzo E. Anderson, being the highest bidder, the property was knocked down to him at the sum of $13,100 cash, which price Anderson paid to Hartnett on the same day, and Hartnett, as trustee, applied the same to the payment of the costs and expenses of the sale, to the amount due as he was informed, to the defendant association under the $13,000 and $3,000 deeds of trust,

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leaving a balance in his hands of $15.57, which he was, and has always been, ready and willing to pay plaintiffs; that the sale was made by him in good faith, 264 and in strict accordance with his powers and duties as trustee; that he paid out the proceeds of said sale as he was required legally and equitably to do; that said Anderson was a bona fide purchaser, and that defendants were not interested directly or indirectly in said purchase, "nor in anywise in said sale except as trustee as aforesaid." His answer to the second count is the same as his answer to the first count.

The replication to the answer of the association pleads that the amounts charged plaintiff by the defendant association as dues, interest, fines, premiums, and other charges, were illegal and usurious; that the sections of the by-laws set up in the association's answer, as well as section 2814 of the Revised Statutes of 1889, concerning premiums, on which said bylaws are alleged to be based, are in conflict with and contravene section 53, article 4, of the constitution of the state of Missouri, and also that they violate sections 5973, 5975 of the Revised Statutes of 1889, and are also in violation of the Laws. of 1891, pages 169 and 170.

The replication to the answer of Lorenzo E. Anderson states that the by-laws concerning interest, dues, and other charges, were illegal because of the facts stated in the replication to the answer of the De Soto Savings and Building Association, and that said Anderson and the Wiggins Ferry Company knew this fact; that Anderson did not purchase said realty in good faith, and that he and the Wiggins Ferry Company "had full knowledge and notice of the wrongful and unlawful acts of said Anderson's codefendants.” The remainder of this replication sets up the illegality and unconstitutionality of the by-laws and statutes in the same manner in which they are pleaded in the replication to the answer of the association.

The replication to the answer of Joseph P. Hartnett sets up the illegality of the by-laws and the unconstitutionality of the by-laws, alleging that they contravene section 54 of article 4 of the constitution of the state 265 of Missouri, and states that Hartnett has been since April, 1895, a shareholder in the defendant association, a member of its directory, president thereof, and knew that the by-laws were illegal, and that he also knew that plaintiffs were not in default at the time he advertised said property for sale. The trial resulted in favor

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of defendants, dismissing plaintiff's bill, and judgment against them for costs. They appeal.

The facts are briefly stated by counsel for the defendant association and Hartnett, as follows: On the tenth day April, 1895, John McDonnell, since deceased, was the owner of eighty shares of stock in the defendant association. He was also at that time a director in the association, and continued to be such until the year 1898. On that day he borrowed from the association, on fifteen shares of his stock, the sum of $3,000 from which was deducted $450, the premium bid at auction by McDonnell for the preference, and the balance of $2,550 was paid by the association to him. To secure the payment of said $3,000 McDonnell executed his bond in favor of the association in that amount, bearing six per cent interest, and a deed of trust on property on Prairie avenue, in the city of St. Louis, Missouri.

On the fourteenth day of March, 1896, he again made application for a loan of $13,000, on his remaining sixty-five shares of stock, and said sum being put up at auction, at which he was the highest bidder, was awarded him on his bid of fifteen and one-half per cent. The premium of $2,015 was deducted, and the balance of $10,985 was either given to him or raid out at his direction. To secure the payment of this sum McDonnell executed in favor of the association his bond for $13,000, bearing interest at six per cent per annum, and deed of trust on property of McDonnell situated on Bremen avenue, in the city of St. Louis, Missouri.

266 About August 24, 1897, at the request of McDonnell, the association canceled the first bond and deed of trust, and accepted in lieu thereof a new bond for the same amount and a second deed of trust to secure the payment of the same upon the Bremen avenue property also. The first bond and deed of trust were canceled, and McDonnell executed a new bond for $3,000, bearing six per cent interest, and a deed of trust on the Bremen avenue property.

Said bonds were alike in form, and each provided as follows:

“And that they will faithfully pay all dues and fines on said stock, and also the interest aforesaid, and perform any other obligation required of them by the by-laws, rules and regulations required, or may be by said association or the board of directors, and keep the association free from all losses and damages by reason of said loans.

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"Now, therefore, the condition of this obligation is such that if the above bound obligors, their heirs, etc., shall and do well and truly pay or cause to be paid, unto the above-named association, its attorney, successors or assigns, the sum of $13,000 in one case and $3,000 in the other, on account of the stock in said association, and the interest on said loan when due (monthly dues and interest being payable on the second Wednesday of each and every month from the date of these presents until the dissolution of the association), etc., then the above obligation to be void, provided, however, that it is expressly agreed that if at any time default shall be made in the payment of said monthly dues, interest or fines, and the same shall remain unpaid for the space of six months after any payment thereof shall fall due, then the whole principal debt, with interest thereon, from the date of these presents to the date of sale, at the rate of six per cent per annum, shall, at the option of the association, its successors and assigns, immediately become due and recoverable, and the payment of said 267 principal sum and all interest thereon, as well as dues and fines then due and payable, may be enforced and recovered at once by sale under said deed of trust of the property described therein, according to the terms and provisions of said deed of trust."

In each deed of trust it was provided as follows: "That if at any time default should be made in the payment of monthly dues, interest or fines, and the same shall remain unpaid for the space of six months after any payment thereof shall fall due, then the whole principal debt shall, at the option of said association, its successors and assigns, immediately thereupon become due and recoverable, and payment of said principal sum, and all interest thereon, as well as monthly dues and fines then due, may be enforced and recovered at once by sale, under the deed of trust, of the property herein described, according to the terms and provisions of this deed of trust. .... But if the said parties of the first part, or their legal representatives, shall fail to pay or cause to be paid unto the said association, its attorneys, successors

or assigns, the monthly installments of dues, interest and fines . . . . as above provided and according to terms, tenor and effect of the said bond, then this deed shall remain in force, and the said party of the second part may proceed to sell,” etc.

The only difference in the bonds is the amount agreed to be paid, viz., in the one case McDonnell agreed to pay on the sixty-five shares of stock the sum of $130 a month, $65 being

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payment of $1 a month on each share of stock, and $65 being interest at six per cent on $13,000; and in the other case, viz., the $3,000 loan, McDonnell promised in the bond to pay $15 a month on his fifteen shares, and $15 a month interest, being six per cent of $3,000. Accordingly McDonnell was under obligation to pay to the association monthly, the sum of $80 on dues, and $80 interest, or the aggregate of $160 per month.

208 From the month of April, 1897, to the month of December, 1897, a period of eight months, McDonnell paid no dues, interest or fines. He then began his payments of $160 a month, and continued to make them monthly until May, 1898, but failed to pay his dues, interest and fines for the eight months from April to December, 1897, though often requested by the association to do so.

The association decided in June, 1898, to sell the security, viz., the Bremen avenue property, and requested Hartnett, the trustee, to do so. He gave the required twenty days' public advertisement through the “St. Louis Star,” and on July 18, 1898, sold the property at the east front door of the courthouse in the city of St. Louis, to Lorenzo E. Anderson, the highest bidder, for $13,100. At this time McDonnell owed to the association, after allowing him all just credits, the sum of twelve thousand nine hundred and some odd dollars. He was present at the sale and offered no objection to the sale of the property or the manner in which it was being sold. He was a director of the association when both advancements were made.

Section 1 of the by-laws of the association provides that no loan shall be made at a less premium than ten per cent.

It is argued by plaintiffs that because the by-laws of the association provide that “no loan shall be made at a less premium than ten per cent," there is thereby fixed an arbitrary rule, which in effect told McDonnell that he could not procure a loan from the association at less than ten per cent premium, and that although McDonnell bid fifteen per cent premium on the $3,000 borrowed, and fifteen and one-half per cent upon the $13,000, the premiums paid by him were usurious. In support of this contention plaintiff relies upon the case of Price v. Empire etc. Assn., 75 Mo. App. 551, in which it is held that as the loan was not sold at an open meeting of the directors, but the premium or costs of 209 preference was

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