SAVINGS AND LOAN ASSOCIATIONS ‑- 'PERSON' AS INCLUDING CORPORATIONS IN PROVISION LIMITING AMOUNT OF LOAN

SAVINGS AND LOAN ASSOCIATIONS ‑- "PERSON" AS INCLUDING CORPORATIONS IN PROVISION LIMITING AMOUNT OF LOAN

The definition of the term "person" as used in section 58, chapter 235, Laws of 1945 (§ 3717-177 Rem. Supp. 1945), as amended by section 5, chapter 257, Laws of 1947 (§ 3717-177 Rem. Supp. 1947), must be construed to include a "corporation" and a savings and loan association may not loan an amount in excess of 2% of its assets to a corporation without the prior written approval of the supervisor.

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                                                                   June 29, 1951

Honorable A. O. Kent
Supervisor
Division of Savings and Loan
Public Lands-Social Security Building
Olympia, Washington                                                                                                                Cite as:  AGO 51-53 No. 84

Dear Sir:

            We wish to acknowledge receipt of your letter of June 22, 1951, with reference to the provisions of section 58 of the Savings and Loan Association Act of 1945, being section 58, chapter 235, Laws of 1945 (§ 3717-177 Rem. Supp. 1945), as amended by section 5, chapter 257, Laws of 1947 (§ 3717-177 Rem. Supp. 1947), which prohibit an association from loaning an amount in excess of 2% of its assets to any one "person" without the prior written approval of the supervisor.

            You ask our opinion as to "whether or not this regulation would authorize a loan greater than 2% to a corporation."

            It is our conclusion that:

             [[Orig. Op. Page 2]]

            The definition of the term "person" as used in section 58, chapter 235, Laws of 1945 (§ 3717-177 Rem. Supp. 1945), as amended by section 5, chapter 257, Laws of 1947 (§ 3717-177 Rem. Supp. 1947), must be construed to include a "corporation," and a savings and loan association may not loan an amount in excess of 2% of its assets to a corporation without the prior written approval of the supervisor.

                                                                     ANALYSIS

            The pertinent portion of section 58 of the Savings and Loan Association Act is as follows:

            "An Association shall not loan to or purchase contracts payable by any oneperson in an amount in excess of two per cent (2%) of its assets, except with the prior written approval of the Supervisor."  (Emphasis supplied.)

            The general rule of statutory construction appears to be that the term "person" includes a corporation unless an intent to the contrary is plainly obvious.  State ex rel. Attorney General v. Seattle Gas Company, 28 Wash. 488, 493, 68 Pac. 946;U. S. Tire Company v. Keystone Tire Sales Company, 153 S.C. 56, 150 S.E. 347, 66 A.L.R. 1264.  This conclusion is strengthened by the provisions of Rem. Rev. Stat. 146 which specifically authorizes that "The term 'person' may be construed to include * * * any public or private corporation, as well as an individual."

            In view of the evident legislative purpose to prevent a concentration in the number of debtors of an association, we are of the opinion that the term "person" was intended and must be construed to include a corporation.  Under this interpretation the limitations of section 58 of the Savings and Loan Association Act would prohibit an association from loaning an amount exceeding 2% of its assets to a corporation, except upon the prior written approval of the supervisor.

Very truly yours,

SMITH TROY
Attorney General

FRED L. HARLOCKER
Assistant Attorney General