(after stating the facts.) “Mutuality,” it has been said, “is the essential principle of a building association.” Its principal object is to raise a fund to advance to those of its members who may desire to borrow money. For this purpose each member subscribes for the number of shares in its stock he desires, and at stated times and short intervals pays upon the same small sums of moAey, called dues. He continues *388these payments until they, with the profits derived from other sources, after the deduction of expenses and losses, equal the face value of the stock, when the stock is matured. The shares are then called in, and the owner receives the face value thereof in cash, unless he has received an advance on his shares, and in that event his obligation based upon such advance is cancelled. Before the maturity of the stock the dues paid are usually advanced to the member who will relinquish to the association the prospective dividend to be paid upon his shares at their maturity in exchange for the lowest present cash payments per share, he agreeing to pay the dues on the shares and interest on the sum advanced “until the association is able to divide, to each share of the stock held by the members, the par value of those shares as fixed in the charter.” In other words, he agrees to pay the dues and interest until his shares reach their par válue, in consideration of the amount advanced to him before that time. The dues and interest so paid contribute to create the common fund with which the stock of the association is matured and paid.
The member, who has received the advance on his stock still holds his interest in the common fund and in the management and success of the association. He is as much interested as the members who have received no advance. All are bound in proportion to the amount of their shares for the payment of the expenses and losses of the association. The latter class of members is interested in the increase of the common fund because upon it depends the payment of its shares; and the former is interested because upon it depends his discharge from the obligation to pay dues and interest until the maturity of his shares. Eversmann v. Schmitt, (Ohio) 41 N. E. Rep. 139.
The duty of all the members of both classes to pay dues until the maturity of their shares depends,' however, upon the solvency of the association. The insolvency of the company subjects it to being wound up by judicial proceedings at the instance of any of its members; and when insolvency occurs, and such proceedings are instituted, the association becomes unable to carry out its contracts with its shareholders; its stock *389can never be matured; its members are relieved of the further payment of dues on their shares; and the further performance of its executory contracts is placed beyond its power. In such a state of affairs nothing remains but liquidation; and so much of the amount advanced to a member, and interest thereon, as has not been paid immediately becomes due and collectible. This is a result of the necessity of the situation. How shall this amount be ascertained? See Weir v. Granite State Provident Association, 38 Atl. 643; Knutson v. Northwestern Loan & Building Association, 67 Minn. 201; Rogers v. Raines, 38 S. W. Rep. (Ky.) 483; Strohen v. Franklin Savings & Loan Association, 115 Pa. St. 273; Hale v. Cairns, 77 N. W. Rep. (N. D.) 1010; and Thompson on Building Associations (2d Ed.) §§ 171, 297, and cases cited.
He, of course, should be charged with the amount he actually received, with legal interest thereon. The question is, with what should he be credited? The insolvency of the association and the consequential winding up of its affairs place him in a dual relation to the association, which is that of a borrower whose debt is due, and of a stockholder. The dues paid by him on his shares are a part of its capital stock, and belong to all of its members alike, and should bear their proportionate part of the losses and expenses of the corporation. In this way he is made to bear his part of the burden. Being liable in this manner, it is evident that he is not entitled to receive, or be credited with, anything on account of dues paid until the expenses and losses are ascertained and deducted and his proportion of the assets of the- company is determined. Were it otherwise, and he entitled to be credited with dues on the amount of his indebtedness for advances, it is evident that he would receive the value of his shares, so far as that value is the result of dues, while the members who have received nothing would be compelled to bear all the losses. This would be subversive of that mutuality, equality and fairness upon which building associations are supposed to be based. It follows, then, that, as to his proportionate . part of the assets of the company, he must await the period of final distribution. See cases above cited, and Rogers v. Hargo, 20 S. W. Rep. *390(Tenn.) 430; Price v. Kendall, 36 S. W. Rep. (Texas) 810; Wohlford v. Association, 140 Ind. 662; Phelps v. American Savings & Loan Association, 80 N. W. Rep. 120.
What we have said of dues does not apply to interest and premiums actually paid. The latter were paid solely on account of the advance. The member who paid the same did so in consideration of the complete execution of his contract with the association. That consideration, by reason of the insolvency of the company and consequent proceedings, has failed, and he, as to the advance, has become a borrower, whose debt therefore is due, and the interest and premium paid should be credited to him on such debt. The members who have received no advances, having paid no premiums and interest, are not entitled to share in those paid by the member who has. See cases cited above.
, The rule adopted and followed in Roberts v. American Building & Loan Association, 62 Ark. 572, does not apply to this case. The object of the rule in that case was to ascertain the amount due when the member who received the advance was in default aud the association was a going concern.- In this case the reverse is true, and all the stockholders are in default by reason of the insolvency of the association. Weir v. Granite State Provident Association, 38 Atl. (N. J.) 643; Price v. Kendall, 36 S. W. Rep. (Ky.) 810. For the same reason the penalty that the bond sued on authorizes the association to sue for and recover cannot be enforced. The condition upon which the right to it depends has never occurred, and the association has never elected to sue for it.
In the case before us the appellee, James L. Phillips, bid fifty per cent, of the face value of his shares for the advance received by him from the association. The monthly payment of sixty cents upon each share was paid to and received by the association as dues, according to the terms of his bond. When the advance was made, he, in consideration thereof, agreed to pay the monthly dues on his stock until its maturity. In this he undertook to perform what he agreed with the association, and thereby indirectly-with its members, to do when he became a fellow stockholder. His duty as to his shares was not changed by the advance. When his stock matured by the performance *391of his contract, he was to receive all the benefits accruing, All the sums paid on the stock were dues; the whole of each, and every sum so paid was a due as much as any part of any of them. It is, therefore, evident that, in the equitable adjustment of the rights of all parties made necessary by the insolvency of the association, he should be credited with the whole of the sixty cents per share per month on his account as a shareholder, and not as a borrower. Hale v. Cairns, 77 N. W. Rep. (N. D.)1010.
Appellant does not seek to recover any premium in this action.
It is said by appellee, James L. Phillips, that he is entitled to offset the present value of his stock against any judgment that may be recovered against him. That cannot be done in this action. The amount due on the stock cannot be ascertained until the final account of the receiver is filed in the action in which he was appointed. This court has not sufficient information to enable it to ascertain the amount. As to it, appellee must await the period of final distribution of the assets. Rogers v. Raines, 38 S. W. (Ky.) 483; Weir v. Granite State Provident Association, 38 Atl. (N. J.) 643.
The decree of the circuit court is therefore set aside, and the cause is remanded, with instructions to the court to enter a judgment in accordance with this opinion and to foreclose the mortgage to pay the same, and for other proceedings.
Riddick, J., dissents.