Case ID: sc-eq_2/html/0623-01.html
Source: Caselaw Access Project
Author: {"author": "Chancellor Rutledge", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

[Present, Chancellors Rtotiedgb and Jaiies.]
    The Executor of Alexander Inglis, vs. John Nutt.
    NOVEMB. 1808.
    The bill charges improper restraint on complainant in obtaining his bond for an open account debt, including war interest. The charge notbeing supported by any proof, and being denied by the defendant, in his answer* must be put out of the case.
    A debtor giving his bond voluntarily, for an Open account, including war interest, is bound by it.
    A debtor quitting this country and joining the British, and living in F.ngland, as a British subject, and giving his bond in England, for a debt on account, including war interest, cannot in this country get rid of the bond. More especially as he acquiesced for many years, and had new dealings with the defendant:
    The defendant had a remedy at law, if he had any rights, on suit brought ag-ainst him on the bond, of which he did not avail himself, and comes too late to this court:
    THIS was a bill to obtain an injunction to restrain tbe defendant, who was a British subject, from enforcing a judgment obtained on a bond of Alexander Inglis, since deceased; and to set aside said bond as improperly obtained ; and that the accounts between the parties should be referred to the master, to ascertain what was legally due.
    The bill set forth, that the' deceased residing in America before the revolutionary war, had commercial dealings with defendant, residing in England; and that at the peace of 1783, a considerable balance was due by the former to the latter. That Inglis being in London in 1784, was induced by threats of a Suit to give bond for the balance dtie Nutt, including all the interest charged in defendant’s account, and which Inglis was not by law liable to pay, but being ignorant of his rights, Mr. Inglis reluctantly executed the bond. That Inglis died in 1791,before any adjudication was made by the courts of this state, on the question of interest during the war, on British debts.
    That an action was, after Inglis’s death,- commenced against complainant as his executor on said bond, by defendant’s agent Mr. Powell, and complainant suffered judgment to gó by default, on the express condition and understanding, that suffering said judgment to go by default, should in no wise prejudice the question respecting complainants rights as to the war interest.
    , But defendant now claims the full payment of the war interest, and threatens tb enforce his judgment.
    Sill prays that defendant may be restrained by injunction from proceeding at law ; the bond brought into court and cancelled ; and that the defendant’s account may be referred to the master or a jury to ascertain the amount legally due, according to the principles established in the federal coüits* and prays general relief.
    The answer of. the defendant John Nutt, of London, sets forth, that Ingiis,.before the American war, carried on business with the defendant in a confidential manner. That before the. conclusion of the war, Ingiis left Carolina* and was not there when peace was made. That when peace took place, Mr. Ingiis prepared to return to Carolina,. and having expressed his wish to have his account with defendant settled, and that a bond should be taken for the amount, such account was made out, and the bond given for the balance, including 300/. for goods sold to Ingiis, in September, 1/84. Defendant denies that he ever used any threats to Ingiis, for the purpose .of obtaining skid bond j but the same was given voluntarily by Ingiis. That defendant has been informed that a judgment has been obtained against the estate of Ingiis, and that no plea was entered for the purpose of depriving defendant of the war interest on said bond : but that an application was afterwards made to deduct such interest, which application the court refused to grant; Defendant prays to be dismissed, &c;
    At the Hearing, the written evidence of Mr. R. W.. Powell* was produced, and read. Mr. Powell stated that he was the attorney in fact of John Nutt, at the time the suit was instituted, and judgment obtained on the bond of Mr; Inglis. He had no power, nor did hé consent or agree to compromise, or to give up or reserve the question of the interest during the war. '
    That the judgment at law was obtained in the usual course: and witness understood that when the defendant af-terwards attempted to get the judgment set aside, in order to be let in to a defence, to get rid of the interest during the war, the Court of Common Pleas refused to set aside the judgment.
    No evidence was adduced by the complainant of any duress, or threats in obtaining the bond in question ; and ihat point was not insisted on in the argument.
    Mr. W. L. Sjiith for complainant,
    argued that Mr. Inglis being in England when he gave his bond for the debt on his open account, including interest during the war, was then ignorant of his right to have that interest deducted. That such ignorance of his rights would excuse his giving the bond, and would induce this court to open the transaction, and to give complainants an opportunity of getting the benefit, of which he was deprived by such error. '
    That interest during the wár ought not to have been allowed. It was against reason and natural justice, that the citizens of this country should be obliged to pay interest on debts due to subjects of that government, which by inflicting the calamities of war on this country, prevented the beneficial us^ of the money. And that in consequence, of these national calamities, the courts of justice had interfered to protect the citizens from being obliged to pay interest during the war.
    
    
      In the case of Greenwood vs. Higginson, though the account including- interest was acknowledged by Greed-Wood, yet the covirt opened it, & the jury struck off 7 years war interest. The counsel cited also the cases of Greenwood vs. the Executors of Maham, decided in 1791; and Greenwood vs. Air, iff 1795, in which interest during the war was disallowed* Also, 2 Dallas* 102, 132 ; 4 Dallas, 22; 1 Eq. Cas. abr. 84 ; 2 Bro. C. C. 150 : and 3 Ves. 456.
    See also Mr. Jefferson’s reasoning on this question in his- letter to Mr. Hammond, the British Minister Plenipotentiary. That part of his letter which applies to this subject, is copied'in- 2 Dallas, p. 104 to 110, in note.
    Mr. Cu'eVes for defendant.
    Hé argued that this was the case of a debtor deliberately settling' his account, and voluntarily given his bond for the balance,- including the war interest. This was a waiver of his'objections to the payment of interest during the war. There' was no injustice in this, and he would be bound’ to pay interest as secured by his bond. See 1 Term. Rep. 285, and 2 East. 469. There was no such ignorance of rights as would entitle the party to open this settlement, and get rid of this bond.- Thefe is' a nfarked distinction betweert the ignorance of the law,- and legal rights ;• and of the facts on which a man’s rights ate founded., An ignorance of the former does not excuse or release a man from his engagements. But Mr. Ingiis was in England, in the character of a British subject, and was not entitled to the benefit of such exemption from interest, if there had been such law, andhe was bound by his act done there.
    But justice is wholly against this plea to extinguish interest ; for the debtor has had the use of the creditor’s money, which entitles the lattef to interest* It would be inost mischievous, if the contests among nations should put the cords of justice, which bind individuals to each .other.
    There have been indeed some cases decided in Ameri,ca against the responsibility .of debtors to pay interest during the war, but they do not go so far as to establish a ge-' neral rule, and still less to release a party, who has voluntarily agreed to pay interest after the war was ended.
    They are generally, if not wholly, cases of account. And these decisions have been overruled by others of higher authority.
    In Massachusetts, an act of the legislature ■ was passed disallowing interest from J9th April, 1775, to 20th January, 1783 : but,in 1787,.the legislature repealed all laws repugnant to the treaty; and. their courts have ever since allowed interest during the war.
    The Supreme Court of the United States decided in favor of interest; four judges reversing the judgment of one judge brought up from the .Circuit Court in Virginia. 3 Dallas, 199, Ware, administrator of Jones, vs. Hylton— This decision was delivered after great consideration, and is binding on the State Courts, which have generally conformed to it.
    In the case of Crawford vs. Willing, 4 Dallas, 286 to 290, decided in the Supremé Court of Pennsylvania, the two judges present, Smith & Breckenrige, expressly declared that the effects of the revolutionary war would not furnish the defendants with a justification or excuse against^ the claim of interest.
    . The act of our legislature, for the payment of debts by instalments, expressly reserves the question of interest during the war with Great-Britain. See Judge Grimke’s collection of the Public Laws, p. 467.
    
      
       The only Case which I find in the books oh this subject is, the case of Basil v. Atcheson. 1 Bro. P. C. 526, 529, where it was decided by the house of lords, on appeal from a decree of the Court of Chan-eery in Ireland, that where lands, which are a fund for Hie payment of interest, produce nothing by reason of a general national calamity, interest ought not to run during the continuance of such grievance. The ftrder ofthe Court of Appeals was (p. 530.) Ihat in making-up the account, “such allowances were to-he made of interest, as were usually done in Ireland, on account of rebellions or other public calami, ties happening to estates in mortgage.”
    
   Chancellor Rutledge

delivered the decree of the court.

There are abundant reasons why the complainants are not entitled to any relief in this case. Because the fendant has positively denied the charge of duress,- and as positively swears that it was by A. Inglis’s own desire ^hat he settled his debt with defendant, and gave his bond ^or^ amount freely and voluntarily, and there is noevi-dence to contradict his answer. None of the cases that have-been determined are applicable to this. For in those cases the defendants uniformly opposed the allowance of interest during the war, and refused to settle their debts on those terms, except G. and D. who signed stated accounts, allowing-interest, but they were British subjects, and the other partners who were citizens of this country refused to abide by their acts. Because A. In-glis having refused to take the-oath prescribed by law at the commencement of the revolution, left this state, and went to reside in Great Britain, as a British subject; he being banished by the act of 1782, and he could not have returned here, without being liable to be tried for a capital offence. That he continued a British subjéct, and was such at the time of signing this bond, being then in London, although he had permission to return under certain terms and conditions, which he had not then accepted. Because A. Inglis after his return to- this state, where he resided for several years, made no objections (that the court know of) to paying this bond; but it appears from the defendant’s answer, had considerable dealings with him, and drew bills on him to a large amount, which were regularly paid: Because it does not appear on the face of the bond, what part of it was for interest, if any; and it is impossible to discriminate principal from interest, without unravelling accounts contracted upwards of thirty years ago, and which have been settled, for any thing that appears to the court, to the satisfaction of all parties, upwards of twenty-four yqars since. Because all the creditors of Inglis in this suit have become so subsequent to the date of the bond to defendant, when he was a British subject. Because if complainants were really entitled to the relief prayed for, they had compleat and adequate remedy at law. That having neglected to make their defence in the -,Srst instance, and the court of law having refused ío se$ aside the judgment on motion for that purpose, there is no ground for this court to interfere.

Bill must be dismissed with costs, to be paid out of the funds of Inglis-s estate, now in the bank.