The complaint sets forth three similar causes of action, each being for money had and received, and based upon the payment by the plaintiff to the defendant of certain sums of money, the first two on cumulative profit-sharing certificates and the third on a so-called gold certificate, all issued by the defendant.
The defendant interposed a demurrer to the effect that the facts alleged in each cause of action did not constitute a cause of action.
*651The only question raised is the question of law as to whether it was ultra vires for the defendant corporation to receive the moneys in question.
If the defendant had no power to make these contracts, the contracts are void and the plaintiff is entitled to recover back from the defendant the moneys paid under such agreement.
The defendant is incorporated under the Business Law, and is alleged in the complaint not to be incorporated under the Banking Law of the State of New York.
The Stock Corporation Law, section 6, expressly limits the powers of stock corporations and gives them only the right to borrow money and contract debts when necessary for the transaction of their business or for the exercise of their corporate rights, privileges or franchises, or for any other lawful purpose of the incorporation.
The General Corporation Law, section 10, provides that no corporation shall possess or exercise any corporate powers not given by law or not necessary to the exercise of the powers so given, and provides that the certificate of incorporation can only contain provisions which do not exempt the directors and stockholders from the performance of any obligation or duty imposed by law; that is to say, the certificate of incorporation cannot give the corporation any greater powers than those to which it is entitled by law. ■
Section 22 of the General Corporation Law, as amended, provides that: “No corporation, domestic or foreign, or other than a corporation formed under or subject to the banking laws of this state or the United States, except as permitted by said laws, shall by any implication or construction be deemed to possess the power of carrying on the business of discounting bills, notes or other evidences of debt, of receiving *652deposits, or buying and selling bills of exchange, or issuing bills, notes or other evidences of debt for circulation as money,” etc. .
The Banking Law (Cons. Laws, ch. 2), in defining mortgage loan or investment corporations, provides: “ The term 1 mortgage loan or investment corporation,’ when used in this chapter, means any corporation other than an insurance corporation formed under the laws of this state or of any other state and doing business in this state, for the purpose of selling, offering for sale, or negotiating bonds or notes secured by deed of trust or mortgages on real property or choses in action, owned, issued, negotiated or guaranteed by it, or for the purpose of receiving any money or property either from its own members or from other persons, and entering into any contract, engagement or undertaking with them for the withdrawal of such money or property at any time with any increase thereof, or for the payment to them or to any person of any sum of money at any time, either fixed or uncertain; and when applied to any foreign corporation doing business in this state shall include,” etc.
In the case at bar, the contract between the parties is evidenced by the alleged certificate, which constitutes their agreement. This provides that, in consideration of the payment of $107.36 annually, or, at his option, the sum of $9.20 each month in advance during the period of ten years from date, the defendant promises to pay to plaintiff or the recorded owner of the certificate, at the expiration of the said period, upon presentation and surrender of the certificate, the sum of $1,500, ‘1 and in additon thereto such portion of the profits as the directors of the company may consider just and equitable.”
The certificate also contained a clause to the effect. *653that it was subject to the “ privileges and provisions ” indorsed on the back. It was there stated that: “ The payments on within certificate being accepted by the company for investment business, not for deposit, the owner has the following privileges,” etc., which are briefly .the right to apply the certificate, at any time, with accrued interest on the purchase of any real estate which the company may choose to sell to the holder of the certificate, a right to transfer the certificate, a right to get a paid-up certificate payable at the original maturity date or payable in cash on sixty days ’ notice, according to a schedule annexed, and, in the event of the owner’s death, the company agreed to pay to his representatives the total amount of the premiums paid, with 4 per cent, interest to the date of death, or the holder’s legal representatives might continue the certificate to maturity by making the payments as above stated; also providing that, if any installment remains unpaid for six months, the certificate shall be non-forfeitable for five years from the date of default. A right was reserved to the company to terminate the certificate after the tenth or any later anniversary of its date by paying up its amount with accrued interest, “ together with such portion of the profits as may be apportioned thereto by the directors of the company.”
The certificate -contains the further clause: “In addition to the face value of this certificate at its maturity, it shall be entitled to and the owner shall receive such portion of the profits of the company as shall be apportioned thereto by the directors thereof. ’ ’
In construing this certificate, it appears, in the first place, that there is no provision by which the holder is entitled to receive any of the profits of the business. There is a statement that he may receive such portion of the profits as the directors of the company may give, *654but there is no obligation whatever on the part of the directors of the company to give anything, and, therefore, these clauses which occur three or four times in the certificate amount to absolutely nothing. Secondly, the company claims that this is not a deposit, because there is language in the certificate to the effect that the payments are accepted by the company for investment in business, not for deposit, but, if the contract between the parties shows a mere deposit, no self-serving statement made by the company can change the relations between the plaintiff and the company.
There is no question whatever in my mind but that • this company is violating the provisions of the Banking Law and is transacting business as a mortgage loan or investment corporation, as that form of company is defined in the Banking Law.
In the case of Chapman v. Lynch, 156 N. Y. 551, the American Dairy Salt Company, Limited, issued to plaintiff a pass-book in which was entered ‘1 Frank D. Chapman in special account with the American Dairy Salt Company, Limited.” Under the credit column was entered ‘ ‘ February 11, 1882, Cash $10,880.90, and semi-annually thereafter interest was credited at the rate of 6 per cent. It was there held that the corporation, in accepting the funds of the plaintiff in special account upon deposit, exceeded its corporate power and engaged in a business in which it was not authorized; that its contract was ultra vires, and, therefore, plaintiff’s right of action for the moneys delivered to the corporation accrued at once.
These provisions of the Banking Law were enacted to restrain illegitimate and improper banking.
I am convinced that the complaint shows that the defendant here is engaged in the business of illegitimate and improper banking, arid that the order and judgment appealed from should be affirmed.
*655Order and judgment affirmed, with ten dollars costs and disbursements, with leave to defendant to plead, over within five days after service of a copy of the order entered herewith, with notice of entry thereof upon payment of costs in this court and in the court below, with leave to defendant to appeal to the Appellate Division, First Department.
Guy, J., concurs.