Court Opinion

ID: 7128923
Source: CourtListenerOpinion
Date Created: 2022-07-24 15:16:38.913519+00
Date Added: 2024-06-11T16:14:23.577485
License: Public Domain

Judge Simpson
delivered the opinion of the Court.
It very certainly appears from the evidence, that there is usury in the note of SI,315 20, assigned by M. W. O’Bannon to J. B. & R. W. O'Bannon. To the extent of this usury, Simrall is undoubtedly entitled to relief. Were it conceded that M. W. O’Bannon, his partner, had agreed to be accountable for this usury in the settlement of their partnership accounts, that agreement like all others entered into for the same purpose, is illegal and invalid, and does not preclude Simrall from availing *609ffimself of his right in equity to have the usury purged •out of the'transaction. Nor is any promise made to the lender, not to plead or rely upon usury, obligatory on the party making it; it is but in substance, a promise to pay ;lhe usury. Every usurious agreement embraces such a promise, yet it-does not deprive the party of his equitable right to exclude the usury, and absolve himself from its payment.
Tf-one -execute his -note to a third person, or induce him to buy his note, it is a waiver of any equity against the payment thereof.
A partner who is a creditor of the firm, being himself liable for all the debts of the firm, cannot eoerce payment of í¿e jfrafdeots'be all paid, when he may be paid if there be a sufof'the^firm^if not, the loss must be apportioned amongst the firm.
*609The testimony leaves the matter somewhat doubtful, whether at the time the note was given the payee avowed his intention to assign it,-or whether'the understanding of the parties was, that it was taken as a mere evidence of indebtedness -by the firm, to one of its members, its payment ultimately depending on the-result of the settlement and adjustment of the partnership concern. If, however, -it were conceded that Simrall, at the-time the -note was executed, understood that it was to be transferred to J. B. & R. W. O’Bannon, that would not-change •the equities of the parties.
It is true, that had he, by his conduct, induced them 'to take the note, or had he executed it directly to them -for the purpose of paying their debt, he-would by so-doing, 'have waived, so far as t-h-ey are interested, any equity he -might ha-ve against the payment of the d-emand. But although he may have understood that the note would be ■assigned, he rnay be presumed also to have known that the assignee would take it subject to all the equities-exist, ■ing against it in the hands of the assignor, and therefore, no implication can-arise from the execution of’the -note, that he intended to waive, in favor of any third person, any defence tiiat he might -have against it. Nor do the ¡assignees either aliedge or prove that they purchased the note in consequence of his conduct -or representations. It was received by 'them in discharge of a previous liability of tire assignor to them, and so far as appears, without any information in relation to the circumstances attending its execution.'
A partner who is the creditor of the firm, being himself liable for al! the firm debts, cannot enforce payment of his demand until tire debts due to other creditors are all -paid. When that is done, if upon a settlement be*610tween him and the other partners, there is any thing dm to him, he is entitled to it out of the assetts of the firm, if there be sufficient for the purpose, if not, the loss. whatever it may be, must be apportioned among the members of the firm. The assignees of the partner oc- , ... . cupy his place, their attitude is the same, and their rights such as he would have had at the time of notice oí tjje assignment, if be had still held the note himself. A ° note in the name of the firm to one of the partners, is a writing somewhat anomalous it its character, it creates but an imperfect legal obligation, it is not enforcible at law according to its import, but if enforced at all, has fo be regarded for that purpose, as imposing a separate legal liability on one of the partners. It is, in effect, merely the evidence of one item of indebtedness In the account between the partners; its availability in equity depending upon the condition of the firm, and relative interests and liabilities of the partners as such. If assigned away the assignee takes it with all its imperfections and drawbacks, legal and equitable. And as tire partner himself, had he still retained the note, could only enforce payment 0f pg fu[¡ amount from the firm, in the event that the firm _ 9 effects were sufficient to discharge his, as well as all other , , ...... . . , ,, .. demands agarnst it, his assignees are in no better conditi°n> anc* their right to have the full amount of their dernand made out of the other partner who has had the con-1 trol and management of the partnership concerns, eta-pends on the same contingency. The assignor, as one of Partners>'s no doubt responsible to the assignees for the full amount of the consideration of'the assignment, , -, . ,, . , . . , , , , but the effort in this case by the assignees, is to hold the member of the firm, (there being only two partners,) individually responsible for the whole demand. To render him so liable, it. should appear on a settlement of the partnership transactions and dealings, that he is indebted to'his partner, the assignor, in that amount.
A note in the to^Tmembef™ the firm, id _evxdence of an item of indebtedness between the members of the foreiit^a^iaw aceording to its import. Its availability in equity thee«mdUionPof s¡gnJirmtheIf assignee takes it subject to all its imperfections & payee held
Wherefore, the decree dismissing the complainant’s bill with costs, and dissolving his injunction with damages is reversed, and cause remanded, that a full settlement of the partnership may be made, the amount of usury in the loan ascertained and excluded, and the rights *611ef the parties settled and adjusted according to the principles of this opinion.
McHenry and Caies $ Linsey for appellantPirtle and W. Bullock for appellees.