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The Pamphlet Collection of Sir Robert Stout: Volume 7

XV.—Investment of Money and giving Security

XV.—Investment of Money and giving Security.

Investment of Funds primarily on Freehold and Lease hold Lands.

The funds of the Association shall be primarily invested on mortgage of freehold and leasehold land.

The Board of Directors are hereby authorised at any time

Directors after two years may invest surplus funds.

after the expiration of two years from the commencement of the Association, to invest such part of all sums of money received by the Association as shall not be required for its immediate purposes or use, in advance to any member or members of such Association, upon security of any share or

On security of Shares.

shares held by such member or members, and upon the same terms as to repayment as in case of advances upon freehold security; or the Board of Directors may, with the consent of the Association, to be testified at a public meeting of the Association, and entered in the General Minute Book, invest

On Government Securities.

such moneys upon real or Government securities in the names of such Trustees, and from time to time, with such consent as aforesaid, to alter, transfer, and sell such securities; and all dividends and proceeds to arise from the moneys so laid out or invested shall be regularly brought to account by such Trustees, and shall be applied according to the Rules of the Society. Provided that any advances to members upon their shares shall not in any case exceed the amounts actually paid upon such shares at the time of making such advances.
When they shall consider it necessary, the Board of Directors

Directors to give publicity of Money for Investment.

shall give publicity to the amount of money at their disposal for investment, and the same shall be offered to the Shareholders in the order in which their applications are numbered. Each applicant shall give to the Manager a schedule, setting forth his name, the amount required by him, full particulars

Application for same, how to be made.

of the nature and situation of the property offered as security, the payment of his entrance fees, and at what rate per share per month he desires to repay to the Association the principal and interest of such loan; and on such application being granted in full or in part, then he shall commence at the next monthly meeting subsequent to such application to pay such sum per share per month as may be agreed upon, whether his mortgage shall have been executed or not,

Repeated from 1st May, 1873

in terms of subjoined Table B, which table shall be considered
page 16 as forming part of these rules; and every borrowing member neglecting to pay his subscription or redemption money shall be

Borrowing Member's Fines.

fined for each share as follows:—6d. for the first month, 1
s. 6d. for the second month, 3s. 6d. for the third month, 6s. 6d. for the fourth month, 10s. 6d. for the fifth month, 15s. 6d. for the sixth month, and thereafter a fixed fine of 6s. per month per share.

Mortgage Deed to be executed prior to payment of Loan.

When the Board of Directors shall be satisfied with the security offered by any member, they shall pay to such member the sum which he shall be entitled to receive, upon his executing to the Trustees a deed of mortgage, containing such powers of sale and other powers to the said Trustees, and such covenants on the part of the said mortgagor as the Solicitor of the Association shall require.

Provisions of Mortgages.

The mortgage to be given by the member shall provide that in case the said member shall at any time thereafter fail, neglect, or refuse for three monthly pay-days to pay, observe, and perform all or any of the subscriptions, payments, and regulations on his part respectively to be paid, observed, and performed, the Board of Directors for the time being shall have power, on behalf of the said Association, to appoint the

Manager to collect Bents, &c.

Manager, or any other person or persons, to collect the rents and profits of the premises in such mortgage mentioned, and to charge for such collection, whether by the Manager or otherwise, a commission at the rate of
£5 percent, if the rent be payable quarterly or at longer periods, or £7½ percent, if payable monthly, or £10 per cent, if payable weekly. And the Board of Directors shall have the power, after default in payment of such subscriptions and payments for three monthly pay-days, or on the breach of any covenant on the mortgagor's part in any mortgage expressed or implied, whether the Board of Directors shall have entered into the receipt of the rents and profits of any such mortgaged property

Power of Sale, &c.

or not, and without entering into the receipt of such rents and profits, and without the consent or concurrence of the said mortgaging member, absolutely to sell and dispose of the said mortgaged premises by public auction or private contract,

Repeated from 1st May, 1873.

upon the condition that the purchaser or purchasers shall pay as and for the purchase money of any such property a certain monthly payment (to be fixed and determined by the Board of Directors), until the full amount due to the Association on such property be paid; or to make any arrangement with any member whose property shall be forfeited, or liable to forfeiture, for his retention thereof, and for the cessation of all fines upon subscription and redemption moneys, fines, insurance premiums, and other payments then
page 17 due and in arrear at the time of such arrangement or thereafter to become due to the Association; or to sell and dispose of the same in one or more lots, by public auction or private contract, or partly in one way and partly in the other, at one or more time or times, and subject or not to special conditions as to title or evidence of title, or the time or mode of payment of the purchase money, or otherwise, as the Board of Directors shall think fit, and to receive the money arising therefrom; and at any sale by public auction the Board of Directors, or any one of them, or some other person to be appointed by them in writing, may bid for and buy in the said mortgaged premises on behalf of the Association, and re-sell the same by public auction or private contract, without being answerable for any loss to be occasioned by such re-sale; and out of the moneys to arise from such collection of rents and profits on re-sale as aforesaid, the Board of Directors shall, in the first place, discharge all costs, charges, and expenses which shall or may be incurred in or on account of the collection of the rents and profits of the said mortgaged premises, or the sale or attempted sale or sales thereof, or in anywise relating to the exercise of the powers in the said mortgage; and, in the next place, shall retain and reimburse the said Association all such principal money, subscriptions, fines, and other payments as shall be then due, owing, and payable by such member, under and by virtue of these rules, or the said mortgage, and

Repeated from 1st, May, 1873.

shall pay the surplus (if any) to the said member, or as he shall appoint. And that the receipt of the Board of Directors or Manager of the said Association shall be a sufficient discharge to all tenants and purchasers paying any moneys to the Board of Directors or Manager, without their being accountable for the misapplication or non-application thereof And that no purchaser or purchasers shall be bound to inquire into the propriety or regularity of any such sale or sales, nor whether any such default shall have been made. And that until the said mortgaged premises shall be so sold and conveyed, the Board of Directors shall have full power to let and demise the same or any part thereof for such term of years, at such rent, and upon such conditions of entry, as they shall think fit
No property shall be deemed sufficient security for moneys

No Second Mortgage to be taken (unless first mortgage to the Association).

to be advanced which shall be subject to any previous mortgage, except to the Association.
Whenever a loan shall be made to any Trustee, the

Loan to Trustee.

mortgage shall be made to the other Trustees for the time being.
page 18

Loan not completed.

If from any cause whatever any loan granted by the Board of Directors shall not be completed by the applicant executing a mortgage over the security proposed by him, such applicant shall pay to the Board of Directors a fine or sum equal to one month's payment upon the amount of such loan, according to the class of Table B under which be shall have applied, and

Repeated from 1st May, 1873.

2 of Rule 15.

Payment of Money advanced for building purposes.

When any member shall be desirous of building, he shall be entitled to receive the moneys agreed to be advanced to him in such sums and at such times as the Board of Directors may appoint, upon executing his mortgage.

Board empowered to complete erection of Buildings on default by borrowing Member.

Should any member, after receiving any portion of his loan or advance, not proceed to complete and finish any buildings upon which the same shall have been advanced, to the satisfaction of the Board of Directors of the Association, the Manager shall give seven days' notice, in writing, to such member of their intention either to sell such premises in the manner hereinbefore provided, or to employ some person or persons to finish and complete the same at the cost and charges of such member; and upon the expiration of such notice they shall be at liberty so to do, and to advance and pay the sum and sums of money requisite for such purposes accordingly; and the premises shall be charged with such further sums, with interest at such rate as the Directors shall from time to time determine, as if such sums had formed part of the advance to such member. If a sale shall be made, and a surplus remain after paying all the money due to the Association and all incidental expenses, it shall be paid to such member.

Scrip to be transferred to Trustees.

On payment to any member borrowing upon the security of his shares, he shall transfer his scrip for such shares to the Trustees of the said Association, for which he shall pay the usual transfer fee to the Association.

Fire Insurance.

All buildings mortgaged to the Association shall be insured from loss or damage by fire in the names of the Trustees, for such amount as the Board of Directors shall think necessary, by and at the expense of the mortgagor; and the policy and renewal receipts shall be deposited with the deeds. Should the mortgagor fail to do so, the Manager shall be at liberty to insure the property in the names of the Trustees, or (if already insured) may pay the premium due on such policy out of the Association's funds; but the money so expended, together with a fine of one shilling per month in the pound, shall be paid to the Association by the mortgagor.
page 19
If the mortgagor is not bound by covenant to insure in any

Notice to be given of any alteration.

particular office, the insurance may be effected in any Fire Insurance Office, subject to the approval of the Board of Directors. Each member who shall have mortgaged any property to the Association shall be required to give immediate notice, in writing, to the Manager of any trade carried on in any part of his premises, or of any stove, furnace, or any article erected therein, or of any such similar change in the character or occupation of the adjoining properties which would in any way affect the validity of the policy of insurance. Any member neglecting to give such notice shall pay such fine as the Board of Directors may determine, not exceeding 10s per week nor less than Is. per week, for each share advanced. The Board of Directors shall, as often as they may deem requisite, appoint one or more of their number to obtain all the information they can with respect to trades, &c., carried on in or about such property; and the member shall permit the Director so appointed to inspect the mortgaged premises, and reimburse them all reasonable expenses.
Whenever any property mortgaged to the Association shall

Appropriation of Insurance Money.

sustain damage by fire, the Board of Directors for the time being shall receive the amount recoverable for the damage so sustained from the Insurance Office in which such property shall have been insured, and shall give a receipt for the same, which receipt shall be a sufficient discharge to the person or persons liable by virtue of any policies of insurance to pay such money, and the same shall be applied according to the covenant (if any) under which such insurance was effected; but if none, then the Board of Directors shall have the option of appropriating such money in payment and satisfaction of the money secured by the mortgage of the premises which shall have sustained such damage, or of repairing the damage so sustained, and returning any surplus to the mortgagor.
page 20
First Class—14 Years. Years Monthly Payments. Interest. Repayments. Total. s. d. s. d. s. d. 1 6 8 3 6 10 2 2 6 5 3 9 10 2 3 6 2 4 0 10 2 4 5 10 4 4 10 2 5 5 6 4 8 10 2 6 5 2 5 0 10 2 7 4 9 5 5 10 2 8 4 3 5 11 10 2 9 3 9 6 5 10 2 10 3 3 6 11 10 2 11 2 9 7 0 10 2 12 2 2 8 0 10 2 13 1 6 8 8 10 2 14 0 10 9 4 10 2 Second Class—12 Years. Years. Monthly Payments. Interest. Repayments. Total. s. d. s. d. s. d. 1 6 8 4 5 11 1 2 6 4 4 9 11 1 3 6 0 5 1 11 1 4 5 7 5 6 11 1 5 5 1 6 0 11 1 6 4 7 6 6 11 1 7 4 1 7 0 11 1 8 3 7 7 0 11 1 9 3 0 8 1 11 1 10 2 4 3 9 11 1 11 1 7 9 6 11 1 12 0 10 10 3 11 1 20 Third Class—10 Years. Years. Monthly Payments. Interest. Repayments. Total. s. d. s. d. s. d. 1 6 8 5 9 12 5 2 6 3 6 2 12 5 3 5 9 6 8 12 5 4 5 2 7 3 2 5 5 4 7 7 10 12 5 6 4 0 8 5 12 5 7 3 3 9 2 12 5 8 2 6 9 11 12 5 9 1 9 10 8 12 5 10 0 11 11 6 12 5 Fourth Class—8 YEARS. Years. Monthly Payments. Interest. Repayments. Total. s. d. s. d. s. d. 1 6 8 7 10 14 6 2 6 1 8 5 14 6 3 6 0 9 1 14 6 4 4 8 9 10 14 6 5 3 10 10 8 14 6 6 3 0 11 6 14 6 7 2 0 12 6 14 6 8 1 0 13 6 14 6 Fifth Class —6 Years. Years. Monthly Payments. Interest. Repayments. Total. s. d. s. d. s. d. 1 6 8 11 5 18 1 2 5 10 12 3 18 1 3 4 10 13 3 18 1 4 3 9 14 4 18 1 5 2 8 15 5 18 1 6 1 5 16 8 18 1

Table B.

Borrower's Scale of Payments.

Borrower's Scale of Re-Payment of £50.

This Table shows the Monthly Re-payment of Loans, including Principal and Interest, extending over periods of 6, 8, 10, 12, and 14 Years, from which Table the amount required to redeem at any period

Table B.

during the Contract can be ascertained at once

Repealed as to Mortgages executed after 1st May, 1873.


page 21
If any member who shall have borrowed upon his investment

Forfeiture of Shares.

shares shall make default in payment of his subscription and redemption moneys in respect thereof when such subscription and redemption moneys, together with any fines to which he shall become liable, shall, together with the amount advanced to such member on such shares, make up the amount per share which such member shall be entitled to be paid for withdrawal from the Association, then such shares shall become absolutely forfeited to the Association.
Whenever a member shall apply for a loan, and shall fail

Lapse of application for Loans.

to provide security to the satisfaction of the Board of Directors, they may, after two months from the date of application, declare the same to have lapsed.