Year: 1859

OFFICIAL PAPER OF THE CITY
The Interest Question before the Su


premc Court.


A case has been argued and is now pend
ing in the Supreme Court of this State, whic
turns upon aquestion SO deeply affecting near
ly every person in our State, that we feel jus
titled in referring to it prior to its final decis
ion.


1t is whether higher rate of interest thai
seven per cent per annum, can be enforced
and collected, as damages upon any note o
contract, after maturity.


Our readers will recollect, that about a yeal
since, a case was up before the same Court
in which the Court were unanimous in decid
ing 1st, that the special interest contract
ceased with the maturity of the note and
that when an increased rate of interest was
promised on note to be paid after it became
due, such increased or overdue rate of inter
est was not interest, but merely in the nature
Of penalty, as in a bond: only so much o
W iuCil Coutu OC SOuSSlSu dS OUUNytS lOi ttiS
detention, or for the use Of the money, after
maturity, as the hire of money was legally
worth. So far the Court were unani-
nous and the logical conclusion from
such premises seemed plain and newt
able-that the owner of the note was damdg-
ed only at the rate of seven per cent per an
mum, that being what the law said the use of
his money was ordinarily worth, in the alb
sence of any special circumstances to induce
some person to again contract to give him
more. But no-a majority of that tremendu-
Gus tribunal of heavy dorgs," here turned a
sharp corner, and decided, that the damages
the note owner suffered, should be computed
up to payment or judgment at whatever rate
the original but extinct contract" for inter-
est specified on the face of the note as the in
terest it should bear up to maturity In
other words, the majority of the Court decid-
ed, that though the contrat of interest ternf:n-
ated with the maturity Of the note, yet said
contract still held over and ruled what should
be the compensation for money, and the dam
ages for the retention ofmoney without con-
tract That is, though the law said seven
per cent per annum aoas the ordinary worth Of
money, the majority of the Supreme Court
said it should be worth whatever an extinct
contract prescribed


1t is but due to Chief Justice EMMETT to
mention here, that he dissented strongly from
the last proposition, and contended that the
measure of damages was seven per cent per
annum, and no higher rate could be col
lected on note after maturity


This decision at the time was the occasion
of good deal of comment, both from the
press, the people and the bar. The upsetting
of the Shylock fve-per-cent-over-du rates,
was accepted by all as fair deduction from
the legal premises established by the Court
but the whole of the bar and all the rest Of
mankind, united with us in pronouncing the
conclusions of the majority as to the measure
Of damages, unsound in law and illogical as
to common sense and we have no doubt
such an illegal decision has contributed, in a
greater degree than any one thing, to shake
public confidence in the ability and compe-
tency OF the members of the Court for the
high positions they hold


But, as we commenced this article by in
timating the whole question of the measure
of damages is now substantially before the
Court again; and as to what will be the re-
suit this time, must continue the subject Of
most anxious speculation. The manner and
form in which the Court has had this case
again presented for its adjudication, is this
One LEWIS P MARsroN, sued w. j. TALcorT
upon two notes made by TALCOrT in the sum-
mer Of 1857; one of which was for $40, due
six months after date, with interest from date
until due, at the rate of sir per cent. per an
nam, and after due at the rate of five per
cent per mon.n until paid. The other was for
s4S, due thirty days after date, aoithout any
interest until due, but five per cent per month
after due, until paid. About the same time,
the plaintiff, MARsToS, gave his note to one Pc
TIERS for S7S, due three months after date,
with interest from date until DUE at the
rate of t,co and a half per cent per month,
and after DUE at the rate of three per cent.
per month When MARsroN, unable to get his
money in any other way brought suit against
TALCoTT, it appeared that TALcorr held this
note given by MARsroN to PETERS, and set it
it up in his answer as set-off Such were
the facts.


The only disputed point in the case was the
one in regard to the amount Of interest to be
collected as damages" after maturity and
Judge PALMER, following the former illogical
decision Of majority of the Supreme Court
held, that MARsroN was entitled to ''damag-
es ~ after due, only at the rate of sir per cent
per annum, on his $ll0 note that he
was entitled to damages" alter his $4S note
became due, at the rate of secen per cent per
annum but that on the other hand TALcorr
was entitled, by way of a set off, to calculate
and recover his damages" for non payment
of his S7S note on maturity, at the rate of
taco-and-a-haf per cent month That is, in
case between the same parties, three different
measures of the value Of money without a
contract-three different measures of COM
ne nsation for the use or detention of money,
for abo ut the same time of the year-were ad-
opted y and, we suppose, if there had been
thirty differen:. notes, there would have been
as many different modes of computing the
damages :! We understand, that Mr.. Mas
rEnsoN, the Counsel arguing the case, here
asked the Court, "what was the matter with
Mr.. MARsroN's money, that it was not a.
good, or worth as much, as Mr.. TALcorTs ~
True enough-why


We do not profess to be ''learned in thu
law" but it does appear to us, that any mar
of common sense can see, that such ruling i!