Birmingham v. Maryland Land & Permanent Homestead Ass'n

Miller, J., delivered the opinion of the Court. The question arising in this case is, whether the amount due on the mortgage from the appellants to the appellee, is correctly ascertained by the order appealed from, or whether the usury in the shape of a bonus of $250, and other excessive interest, stipulated for by the contract between the parties, should he eliminated therefrom ? The appellee insists, that the exaction of this bonus is legalized and made valid by the provisions of its charter, the Act of 1868, ch. 427. By this Act certain named individuals and their successors are incorporated under the name of “ The Maryland Land and Permanent Homestead Association of Baltimore County,” and the purpose of the association is declared to he, “the purchase, improvement, sale and leasing of land, the borrowing of money, and the loaning of money to its members and others upon collateral securities, or upon mortgage of real or leasehold property, and to insure the lives of its members and. debtors for the benefit of the association, whereby the security advanced upon may be in case of death secured to the family of the deceased.” And by the eighth section it is provided “that it shall and may he lawful for the said association to loan money upon spch interest as may he prescribed by law, for any period of time, and upon such premiums or bonus as may be agreed upon by the association and the borroiuer, and in all cases to deduct the interest and bonus, or either of them, in advance.” It is a very grave question whether, under the provisions of the Constitution of this State, and especially the fifty-seventh section of the third Article, it is competent for the Legislature, by a special law, to confer upon a corporation like this the peculiar privilege of exacting usury upon loans of money.

But we do not find it necessary now to decide that important. question, because assuming the eighth section of this Act to be constitutional and valid, we are of opinion, the contract in this case is ⁵⁴⁴ not within its terms, and consequently not protected by it. The privilege thus granted is a very unusual and extraordinary one, and no contract should be .brought within its operation unless-made and executed in strict conformity with the very terms of the law. Clearly no latitude or liberality of construction should be indulged in, in order to extend the operation and effect of such a provision, but on the contrary, its extraordinary character, granting as it does to a strictly private corporation, an exclusive privilege of great value, not conferred upon other corporations or the citizens of the State generally, justly subjects it to a rigid and strict construction. In view of these considerations, it would seem to be not unreasonable to construe it as protecting a contract of loan upon a bonus agreed upon, only where the bonus is actually deducted in advance, or, in other words, as making such a contract lawful, provided the bonus is thus deducted and as having no