Building Society – Withdrawing Member – Resolution of Society to Reduce Sum at Credit of Unadvanced Members Invalid.
The rules of a benefit building society incorporated under the Building Societies Act 1874 provided that any unadvanced or investing member might withdraw the whole or any portion of the sum at his credit in the society’s books after giving certain notice. At the annual general meeting the society approved by a majority of a report by the directors recommending that as the property over which the society held securities had fallen in value, a sum of 7s. 6d. per pounds 1 should be deducted from the amounts at the credit of the members, and placed to a suspense account. There was no rule of the society regulating the manner in which losses were to be borne. Held ( rev. judgment of the Court of Session) that the resolution was ultra vires, and that an unadvanced member who subsequently gave notice of withdrawal was entitled to be paid the whole amount at his credit.
Judges:
Lord Chancellor (Halsbury), Lords Bramwell, Herschell, and Macnaghten
Citations:
[1887] UKHL 486
Links:
Jurisdiction:
Scotland
Banking
Updated: 03 November 2022; Ref: scu.636750