Case Name: A. H. INGRAHAM v. JOHN PLUNK
Court: Tennessee Supreme Court
Jurisdiction: Tennessee
Decision Date: 1865-12
Citations: 1 Shan. Cas. 185
Docket Number: 
Parties: A. H. INGRAHAM v. JOHN PLUNK.
Judges: 
Reporter: Tennessee Cases with Notes and Annotations
Volume: 1
Pages: 185–187

Head Matter:
A. H. INGRAHAM v. JOHN PLUNK.
(S. C., Thomp. Cas., 259-260.)
Nashville,
December Term, 1865.
USURY. Makes note void, when.
Where nsnry appears upon the face of a note, it is void and no recovery can be had upon it. [But the note may be disregarded, and suit may be maintained upon the original consideration. For this proposition, and the one in the syllabus, see notes 37 and 38 under sec. 3493 of the Code, .and note 1 under sec. 3499; Bang v. Windmill Co., 12 Pickle, 361. But by the Act of 1897, ch. 81, it is provided that a recovery may be had on a note usurious upon its face for the debt with legal interest. On the subject of usury generally, see Code, secs. 3493-3504, and notes.]
Cited with approval: Isler v. Brunson, 6 Hum., 277; Wetmore v. Brien, 3 Head, 724.

Opinion:
Shackleford, J.,
delivered the opinion of the court:
This is a suit commenced before a justice of the peace in the county of McNairy. There was judgment against the plaintiff in error, from which he appealed to the circuit court. In that court the judgment of the justice of the peace was affirmed, from which judgment the plaintiff in error has appealed to this court. The note upon which judgment was rendered is as follows: "'$187.78. One day after date, we or either of us, promise to pay John Plunk, $187.78, for value received of him, cash lent, gold, and to be paid in gold, at ten per cent, interest, July 23d, 1860. "W. G. Mackey, security, A. H. Ingraham." The court, among other things not excepted to, charged the jury: "The court cannot perceive the destruction of the illegal stipulation for ten per cent, appearing on the face of the note-, it being made to appear by plea, and instructs the jury that the plaintiff has a right to recover of the defendant the principal of said note, with interest at the rate of six per cent, after the maturity of the note, that being the rate allowed by the laws of Tennessee." The charge of the court is clearly erroneous. The act of the legislature, passed the 21st of February, 1860, allowing a conventional rate of interest, not to exceed ten per cent., did not, by the terms of said act, go into effect until the 1st of September thereafter; consequently, the note sued upon, not falling within the provisions of that statute, is illegal, and the court will not lend its active aid to enforce a contract containing on its face, and in terms an illegal stipulation. Isler v. Brunson, 6 Hum., 277. This principle was again settled in a recent case of Wetmore v. Brien & Bradley, 3 Head, 723, in which it was held that every contract which is prohibited, and unlawful by statute, is a void contract, though the statute does not mention that it shall be so, but only inflicts a penalty on the offender, because the penalty implies a prohibition, though there may be no prohibitory words in the statute. The case before us clearly falls with in the principle settled in those cases, and we are, therefore, constrained to reverse the judgment and dismiss the suit.
Judgment reversed and suit dismissed.