Case ID: scl_5/html/0417-02.html
Source: Caselaw Access Project
Author: {"author": "Bay, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

CONSTITUTIONAL COURT, COLUMBIA,
    NOV., 1814.
    James Dickson, Endorsee of Isaac Frazier, v. John Surginer.
    Where it is customary to pay interest on open accounts after the year expired, and the debtor some time after the expiration of a year, gave his note for the amount due, with interest from the expiration of the year, it is valid, and not usurious.
    Summary process on note of hand, dated 22d June, 1812, for $71, Decree by judge Coicock, for the amount of this note, wills interest from 1st January, 1811.
    This was a motion to reverse this decreee, on the ground that the note was usurious upon the face of it. It appeared that the plaintiff was a shop-keeper, and defendant had a running account with him previous to the year 1811; arid that it was usual and customary in the course of trade, between the planters and merchants in that part of the country, that if the planters did not pay up their ae-counts to the merchant by the end of (he year, to allow interest on the balance of their account, from the 1st January following. In this case the plaintiff indulged the defendant, in expectation of getting payment, until 22d June, 1812: and then the defendant, not finding it convenient to pay his account, gave the plaintiff his note for the amount of the balance of his account, with lawful interest from 1st January, 1811: and the point submitted to the court was, whether this was a usurious transaction or not 1
    
    Starr, for the motion. Crenshaw, contra.
    
   Bay, J.

In my opinion, this was not an usurious transaction ; but a fair and just one. There can be no doubt, but that if the plaintiff had added the accruing interest, between the 1st January, 1811, and the date of the note, 22d June, 1812, and taken the note for the aggregate sum of both principal and interest, it would have been good and valid; and I can see no substantia] difference between such a note, and the one in question; which refers back to the period when the interest on the principa] sum commenced, with a promise to pay it. If there had been no previous transactions between the parties, nor any custom to warrant the payment of interest, then indeed it might have been considered as an usurious note: because it would have had the appearance of a shift or pretext, to pay more than legal interest. But in the instance before us, it appears fair and honorable on both sides ; and the custom, or usual course of trade in that part of the country, seems to be a reason, able one.

1 will not pretend to say, that such a custom in a neighborhood, or a part of the country, will constitute such a custom as to make it a part of the law’ of the land, to pay interest on open accounts after the end of the year ; for the uniform decisions of the courts have been'to the contrary. But if a man will voluntarily bind himself to pay interest, because the custom is a reasonable and just ■one, he ought to be bound by it: and the law will hold him to his express contract. I am, therefore, against the motion, and think the decree should stand confirmed.

Nott, Grimke, Smith, Brevard, and Colcock, Js., concurred.