Case Name: Tyson vs. Rickard
Court: Court of Appeals of Maryland
Jurisdiction: Maryland
Decision Date: 1810-06
Citations: 3 H. & J. 109
Docket Number: 
Parties: Tyson vs Rickard.
Judges: The cause was argued Before Chase, Ch. J. Buchanan^ Gantt, and Earle, J.
Reporter: Reports of cases argued and determined in the General Court and Court of Appeals of the State of Maryland, form 1800 ... [to 1826]
Volume: 3
Pages: 109–117

Head Matter:
Tyson vs Rickard.
Ái'i'BAi. from Baltimore County Court. This was an action of replevin, brought by the appellee against the appellant. The defendant below, by bis avowry justified the faking the. goods, &c. being for one years rent in arrear, amounting to 8393 75, of a loi of «round leased by him to William Belton. Three pleas were pleaded to the avowry by the plaintiff, the first and second, of the statute of usury, and the third, in bar de injuria sva propria; io all which pleas there were replication?, each tendering an issue, but to the replication to the last pie? only, issue was joined, and upon that issue a verdict was given for the plaintiff. Motion by the defendant, that judgment op the verdict be arrested, because there was no issue joined in the pleadings. The court overruled the motion, and entered judgment on the verdict for the plaintiff. 1 1 > i '
t. The plaintiff and defendant at the trial, admitted the following facts, vík. That William Belton was, at the time of executing the mortgage to John Hayes, legally and rightfully possessed of the lot and premises hereinafter mentioned, for tlie residue of flip term of 99 years in the assignment from /¿lice Smith and John Smith to William Belton. That a deed of mortgage from William Belton to Robert Maxwell, dated the 2Sd of June 1801, was duly executed, acknowledges! and reeorded? for all that moiety of lot No. (54, in Baltimore town, which had been assigned and transferred to Belton, by Mice and John Smith, on tlie 3 Oth of May 1794 That the said mortgage deed was made for the purpose of securing the repayment of 8KOG0, which had been lent and advanced by Maxwell io Belton. on a contract, whereby Belton had agreed to allow'Ainas :ve.fl an interest at the rate of eighteen per cent per annum, ; \ ! " » x ' > 1 . ' f f , , > ' on the money thus advanced, and that the payment of said interest, so to be allowed, was secured by a promissory note from Belton to Maxwell, which note was duly paid by Belton to Maxwell. That the principa} sum of (§2000, so advanced on the moidgnge, not being paid at the time stipulated in the deed for that purpose, Maxwell urged Belton fop repayment thereof, and that Belton applied to James MiEvoy, a broker in the pity of Baltimore, and requested him to borrow a sum of money, from 3000 to 3500 dollars, OH mortgage of the same property before conveyed to-Maxwell, as well for the purpose of repaying the money lent to him by Maxwell, as iilso to supply other wants of his own, and authorised the said broker to allow an interest offifteen per cent per annum, op the money he might be enabled thus to procure on mortgage. That BTEvoy applied to Nathan Tyson, (the defendant,) to loan the sum of 533500 to Belton, for which he should receive an interest of fifteen per cent per annum, and that the propei'ty so conveyed to Maxwell should be mortgaged to him to secure the repayment thereof. That on this application being made to him, the defendant immediately replied that he was willing to advance the money, bvtt would have nothing to do with a mortgage, because he considered it a troublesome business, and gave BTJSvoy an immediate and posit live refusal to advance any money in that way; but said that bp would make an absolute purchase of the property from Belton for the sum required, and would rent the property to Belton at a rent equivalent to an interest offifteen per cent per annum, with a condition that Belton should fiave a right, when he pleased, (as 31iEvoy then understood,) to purchase the property for the principal money advanced, on paying up the rent, That M‘Evoy returned to. Belton, and informed him of the terms on which the defendant would agree to advance the sum of 53350Q; that Belton thereupon authorised M'Evoy to close the contract on the terms proposed by the defendant, and expressed his Warm approbation thereof, observing at the same time it would be more advantageous to him to obtain the money in this way, than to let the property remain on mortgage ta Maxwell, as he would now only pay at the rate of an interest of fifteen per cewtinstead of eighteen per cent. That in pursuance of the agreement so made through M'Evoy, Belton, authorised the defendant to apply the sum of gSOOO, part <óí the $3300, so agreed to be paid for the purchase of the property, to the payment of the debt remaining due on the mortgage executed to Maxwell, and to receive from Max» well an assignment of the mortgage. That the defendant phid the sum of $2000 to Maxwell, arid Maxwell executed an assignment of tlie mortgage to him, in due form of law, by deed bearing date the 1st of April 1803. That the defendant paid the residue of the sum of $3500 t<$ Belton, and Belton ori the 1st of April 1803, executed á deed ill due form of law to the defendant, purporting to transfer all his right and equity of redemption to trie property mortgaged to Maxwellj and that the defendant duly executed, acknowledged, and delivered to Bolton, a lease of tlie said property, beariug date the 1st of April 1803, reserving the annual rent of 8525ovér and above the annua! rent reserved by the original lease from Smith to Éelloñ, to' b'a paid quarterly iri four equal payments, with a covenant that Tyson, at anyj time within five years, on payment of the full sum of $3500, together with all arrearages of rent then due to him by Belton, would execute a release and assignment of all his interest and estate in the premises', to Belton — ¡which, lease has been duly recorded. That if the defendant had á legal right to make the léase to Belton,■ there was due to him, at the time of the distress, tlie sum of $375. That fhe mortgage to Ilayes was previous to that made to' Maxwell. The plaintiff, to support the issue on his part,- proved by two witnesses,- who were house carpenters, and who bad examined tlie house and lot mentioned in the deed from Belton, to the defendant,' that the same were Worth, and would sell for $7500, and'by two other witnesses, one1 a master-builder, and the other a bricklayer, who had ais» made the same examination, that the house and lot were worth, and would sell for, $6500, and that the lot alone was worth about $4500. The defendant gave In evidence, that the house and lot were seven years ago-worth $4500, The plaintiff then prayed the court to- direct the jury, that upon the statement of facts and evidence,' he the plaintiff was entitled to recover. But the county court, \Niehohon, Ch. J. ami Hollnigsworth, A. J.] refused to give the direction as prayed, but did direct the jury, that to constitute usury there ¡mist be' a lending and borrowing at a greater rate of interest than six per centum, per annum. When these facts occur, and. are establish» eil, no device or stratagem whatever can evade the statute. If the contract is in the shape of a bond, note, mortgage or annuity, it blatters not, the borrowing and lending at an illegal interest contaminate the whole transaction, and make it void. Where an annuity is sold, the mere circumstance of giving the privilege of redemption does not of itself constitute usury; but in the sale of an annuity, whether there is or is iiot a privilege of redemption, yet if the original contract Was in fact a borrowing and. lending* and the sale of the annuity only a device to avoid the statute, it is nevertheless usury. All the cases in the books refer to the original intention of the parties; and if in the cáse now before us, the jury should be of opinion that the original transaction was a borrowing and lending, and the deeds, executed in the particular form in which they appear, merely as a device to evade the statute, then the contract is usurious, and the deeds void. The circumstance of there being no covenant or bond by Belton for the repayment of the money does not vary the case; he had already given a pledge more than equivalent to the money advanced, if the jury believe the testimony in the case as to the value of the property. Tyson agreed to forbear in making absolute his title to the thing pledged, for five years, on condition of Belton's paying 8525 annually, and the obligation to redeem, though not formally expressed m the deed, is virtually in the value of the house and lot. The intention of Belton to borrow is palpable — it is admitted in the case; that of Tyson to lend is not admitted; and the fact of his intention to lend, and to use this form of conveyance as a colouring, must exist in order to constitute usury. It is a fact which the court cannot infer, as not being within our province, but must be found by the jury; and if they believe this fact, their verdict must be for the plaintiff. The ‘plaintiff excepted to the Refusal of the court to give the direction by him prayed, and the tZcfendant excepted to the directon which the court did give.
^Nhere lite de» íendánt plemle# three pleas m an action oí replevin, to which the plaintiff replied* and tendered an imn* to each, hut i'istji? whs joined to the replication to the last plea only, and and upon that issue a verdict iva» given for flu* piam tiff. On motion iu arrest oí judgmen t —Held) that this not. joining issue on the first and second replicad» ons was healed after vei diet.
B authorised art agent to borrow for him a sum of money on an in* teiest pi 16 per pentum per an* mini, to beseemed by mortgage on a house and U U The agent upplioil to T for thn mon< y, in iha name of B, amj made him atquaimrd with the terms oí the contemplan d ’ loan, T replied lie v. a» willing to inUiniee the money, but would hatewnh' mg to do with a mortgage, hat that hewoukl purchase tlie propertyior the sum re* quired,and would rent it to B íoe a rent eqmwuent to an interest of lb per CxX.tumper an* ?iuru, with pviugv to B to ro« deem the proper. ty lot the sum ad« vanefed, on pay* i„.\ no the mu< These terms were acceded to by B, who executed n deed to T, and received from lnm a lease, icacnv* zng a rent equal to 15per centum pa; ainn,r,i on tlie sum advanced* pa)aide quarterly, with a slip motion by T to reeomey the 'property at anytime within five 5 ears, on payment b) B of the »um ad* *«meed, with all arrearages of rent then due. II cl cl, that on a question oí esmj it is the intention ef ihe parties which' givts character to 1he trar'aetion, and 110 matter mhat the form,'■'•here the real froth and substance is a lorn of money at more than an interest oí six per cerium per annum, no shiit <nr device con to hr- it out oí tin* act of iusscmbl) against nsuij. That in the mV'¡>tig«t on oí suck ctuestious, the ot igiiml intention of the parties must often Ik come at f'j matter i’c hors tlie pauicu-> Jar instrument of w riling executed between them That it shotbd bp h it to the jui j to decide npoi\ the whole of the evidence, whether in the true contemplation of the panics, the Iran sac non wans* x cal sale by'one, and a purchase by the other, or whether it vas <-nis colourable to hide a tisurV-us Joan. That a .stipulation to jepay the principal in nu'iiej,is not necessar} to Constitute a loan; 11 j« enough if the principal is secy vet, and not bvn& J!de put in hazard; and it malui\s not. what the nature of the security is, if il is ¡.uifieieitr. Jf the pimcipai is secured, and the interest reserved is moist than the law allows, it is psiiry. That ejery cast: oí usury must depend on its uwn circumstances; and the intention of the parties, when it can he come at, and not the voids used, must That the legal construction of the lease from T to B, (no matter wh&i i< is.) «mmu regulate the. es e, >f it was not their intention that B might, bj 1135 mg the pimcipaf at any time Define the end ot me Erst quarter, discharge himseli ijom the rent due at the time c> payment and that nitcaliom. matter tpr the jury- * '
2. The plaintiff'then insisted, that the money which the defendant furnished to Belton was on loan, and nót as money furnished for the purchase of the lot of ground above mentioned. The defendant then prayed the' direction of the court to the jury, that to constitute a loan it is necessary for the jury to-be convinced that it was the agreement between Belton, and him the defendant, that the principal Was at all events to be repaid to him the defendant in mo-Hey. But the county court directed the jury, that if the agreement between the parties was, that Tyson's title to the house and lot should become absolute at the end of live years unless the money was then repaid, and the original agreement contemplated an accommodation of money by way of loan by Tyson to Belton for that time, that then the method of satisfying Tyson the money Originally advanced, did not alter the nature of the transaction. The de - fendant excepted. Verdict and judgment for the plaintiff} and the defendant appealed to this court.
The cause was argued Before Chase, Ch. J. Buchanan^ Gantt, and Earle, J.
Martin, Harper and Purviance, for the Appellant;'
1. Upon the motion in arrest of judgment, and irregularity in the pleadings in not joining issues to the replications to the first and second pleas, and there being a verdict only upon the issue joined to the replication to the third plea, they cited Bac. Ab. tit. Verdict, (M.) 1 Inst. 227, and Smith vs Raymond, 1 Day's Cases, 189.
2. Upon the question of usury in the bills of exceptions, they cited the act of 1704, ch 69. Murray vs. Harding, 2 W. Blk. Rep. 862. S. C. 3 Wils, 396. Lawley vs. Hooper, 3 Atk. 278. Green vs. Suaseo, 2 Atk. 231. Irnham vs. Child, 1 Bro. Ch. Rep. 94. Spurrier vs. Mayoss, 1 Ves. jr. 529. S. C. 4 Bro. Ch. Rep. 28. Vin. Ab. tit. Usury, (E.) Bac. Ab. tit. Usury, (C.) Tate vs. Wellings. 3 T. R. 581; and Floyer vs. Edwards, 1 Cowp. 115.
Winder, for the Appellee.
1. Upon the. first question he cited Bac. Abr. tit. Verdict. (M) (X.) Hill vs. Lewis, 1 Salk. 133; and Rex vs. Hayes, 2 Stra. 844, 845.
6. Upon the second question, Bac. Abr. tit. Usury, (C.) Hedgeborough vs. Rosenden, 1 Vent. 254. Morse vs. Wilson, 4 T. R. 353. Lowe vs. Waller, 2 Doug. 740; and Turner vs Bouchell et. al. (ante 99.)

Opinion:
Buchanan, J.
I perfectly agree in opinion, on both of the bills of exceptions, with the judges before whom this cause was tried in the court below.
On a question of usury it is the view, the intention of the parties, which gives character to the transaction, and no matter what the form, where the real truth and substance is a loan of money — a lending on one side, and a borrow» ing on the other, at more than an interest of six per centum per annum-, no shift or device can take it out of the act of assembly.
In the investigation ofsiich questions the original intention of the parties must often be come at by matter de hors the particular instrument of writing ésecuted between them, otherwise the' act of assembly would be a dead letter; and in this case Í think the court below did right in leaving it to the jury to dedide upon the whole of the evidence, whether in the true contemplation of the' parties, the transaction in question was a real sale by one, and a purchase by the other; or whether it was only colourable to hide an usurious loan; and in directing them to give a verdict for the plaintiff below, if they found it to be the intention of Tyson and Belton, the one to lend, and the other to borrow — the amount of the rent reserved being equal to an interest offifleenper centum per annum.
As to the second bill of exceptions. A stipulation to repay the principal in money is not necessary to constitute a loan; it is enough if the principal is secured, and not bona fide put in hazard; and it matters not what the nature of the security is, if it is sufficient. As if aman borrows ¿020 to pay ¿010 For interest for one year, and pawns goods to the lender of the value of ¿0100, on astipulation in writing by the lender, to return the goods on payment bjr the borrower of. ¿030, with interest thereon — this is an usurious lending, though there is no undertaking by the borrower to repay the principal. So in this case the principal sum advanced by Tyson was secured by the deed from Belton" The true ground is, not that there must be a stipulation to repay the principal at all events in money, but that it must in some way be secured, as distinguished from being put in hazard; but whether it is secured by pawn or pledge, or a conveyance of land, or is by agreement to be returned in lands, goods or money, is not material. If the principal is secured, and the interest reserved is more than the law allows, it is usury.
The position contended for, "that whenever it is in the power of a borrower of money to pay the principal within a limited time without interest, it is not usury," I conceive has no bearing upon this casé; but is only applicable to cases in which the increased sum is stipulated for nominse pense, and there is no immediate reservation of interest, as in the case of a man lending £20, to receive £40 at the end of two years, or only ¡620 if paid at the end of one year, in which the payment of the smaller or larger sum is intentionally and expressly by the pontract placed at the option of the borrower.
Every case of usury must depend on its own circumstances, and the intention of the parties, when it can be come at, and not the words used, must govern. [The judge here stated the facts, and then continued.]
The intention to negotiate a loan has been found by the jury, whose province it was to inquire into the meaning of the parties; and so far from the rent being reserved nommai pense, or its appearing to have been the intention of the parties that Belton might discharge himself of all rent .by payment of the principal before any rent bad accrued, that is, before the end of the first quarter, it seems clearly to have been their understanding and intention that he should not; for the stipulation in the lease is to re-convey on payment of the principal, together with all arrearages of rent, which shows that they contemplated an accrual of rent, and that the money was not to be paid before such accrual.
No matter, therefor?, w'hat the strict legal construction of the lease from Tyson to Belton is, that cannot regulate the case, if it was not the intention of the parties, that Belton might, by paying the principal air any time before the expiration pf the first quarter, discharge himself from the rent up to the time of such payment; and fhat intention was matter for the jury.
With respect to the matter in arrest of judgment — The. not joining issue on the first and second replications was healed after verdict, and the motion properly overruled.
Gantt and Ea£le, J. concurred.