delivered the opinion of the court.

The Yazoo Building & Loan Association was organized under the laws of the state to transact the business of a building and loan association, and was authorized to issue to its stockholders two kinds of stock — monthly payment stock and paid-up stock. The monthly payment stock was paid for by paying on its issuance fifty cents per share and fifty cents per month until the aggregate paid, plus the earnings, equaled one hundred dollars. To secure paid-up stock it was necessary to pay fifty dollars per share, and when the earnings, added to the amount paid, amounted to one hundred dollars per share, it was called “matured,” and had to be withdrawn.

Appellants were owners of certain shares of paid-up stock, and when the same were about to mature they, by the payment of some cash, exchanged the paid-up stock for interest-bearing stock. About two years after the exchange the association went into liquidation and refused to recognize the acts of its president and secretary in the issuance of the interest-bearing stock. Appellants thereupon exhibited their bill of complaint in the chancery court of Yazoo county, asking that the association be required to pay to them the full amount of the interest-bearing stock, and that a lien be impressed upon all assets of the association to secure the payment thereof; or, if the court should determine that the stock issued to them was invalid, then the court was asked to decree that they were creditors of the association to the extent of the withdrawal value of the stock, exchanged for the interest-bearing stock. There was a further *87prayer to the effect that, if they were not entitled to relief against the association, they were at least, to a personal decree against the officers who issued to them the invalid stock. The canse being submitted to the chancellor upon bill, answers, and proof, a decree denying any relief and dismissing the bill was entered.

It appears that, when the secretary reported to the board of directors the applications of appellants to withdraw their paid-up stock and to take in lieu thereof interest-bearing stock, the board ordered that the stock be issued, “provided the attorney approves it.” The attorney was absent when this order was made, and did not know it had been made until after the president and secretary had issued and delivered the stock to appellants. It further appears that the attorney, when he learned of the transaction, refused to approve it, and rebuked the secretary for his action. Appellants testified that they were never advised of the conditional order or the attorney’s disapproval. The secretary testified that he informed them about both. So here we have an irreconcilable conflict of evidence.

The directors were not bound to issue the interest-bearing stock at all. This was by the amendment to the charter left to their discretion. It is claimed that the board subsequently ratified the issuance of the stock by paying the interest thereon; but. this is not clear, and, if true, we are not prepared to say that ratification can be implied, under all the circumstances of the case. Waiving all question of the right of the board to issue interest-bearing preferred stock in exchange for matured stock, we believe the board could authorize the issuance of the stock, “provided the attorney approved it,” and, it appearing that the attorney did not approve, we think the issuance of the stock was unauthorized.

By the universal custom of the association, holders of paid-up stock were allowed to withdraw their stock and take the withdrawal value in cash. We can find no by-law *88in the record which condemns this practice. It appears, also, that appellants did elect to withdraw their stock in the usual way, and they say that they demanded the cash value of same, but at the request or suggestion of the secretary they accepted the interest-bearing stock in lieu of the cash. The secretary testified that they suggested the issuance of the stock in exchange for the withdrawn stock. This conflict is immaterial, as there is no conflict that they were permitted to withdraw the stock.

When the stock was withdrawn, and the cash necessary to mature the stock was paid, appellants- then became creditors of the association. This was the course of business, and when the stock was thus matured the stockholders could demand the cash. They were no longer stockholders, but creditors. Being creditors, the chancellor was in error in refusing to enter a judgment in their favor for the amount of the matured stock withdrawn, plus six per cent, interest from the date of withdrawal. This seems to be the legal and equitable aspect of the case.

There was a payment to mature the stock, which, when matured, constituted a demand for payment of indebtedness. The fact that the tentative settlement of the claim by the issuance of interest-bearing stock was defeated by the attorney’s refusal to approve the issuance does not affect appellants’ claim-or demand against the association.

It is argued that the association was insolvent at the time of the withdrawal of the stock; but we do not think the record shows this to be true. The assets of the asso-. ciation appear to have been greater than its liabilities, and that the association, nearly two years thereafter, elected to liquidate, does not change the status created by the withdrawal.

Certainly the appellants could have sued the association at law for the amount due them. The very plan of organization makes the holders of matured stock cred*89itors. In Bohn v. Boone Building & Loan Association, 135 Iowa, 140, 112 N. W. 199, 124 Am. St. Rep. 263, the court was deciding a case wherein a stockholder in a building and loan association withdrew his matured stock, and in lien thereof the association executed and delivered to him the association’s note for the withdrawal value of the stock. Shortly after this the association went into liquidation, claiming that the note was invalid, because the stockholder had not paid to the association the money which the note purported to represent. It was the contention of the stockholder that he had loaned the association the amount of the withdrawal value of his stock, and was entitled to priority over the other members, who had remained members subsequent to this transaction. In this state of the case the court said: “If he had received the money in his hand, and then passed it back as a loan, taking a promissory note therefor, no one would question the regularity of the transaction, providing, of course, the officers were acting within the apparent scope of their authority. Such being the case, no reason occurs to us why the same effect is not to be accorded to the giving of the note, without the idle form of passing the money over the table, the secretary only to pass it back again.”

It is shown by the record that several other stockholders matured their stock exactly in the same way that appellants matured theirs, and those stockholders were treated as creditors. When the stock was withdrawn, the holder was entitled to the cash; he no longer shared in the profits; he was no longer a stockholder.

Reversed and remanded.