Court Opinion

ID: 6413824
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:54:39.05896+00
Date Added: 2024-06-11T15:51:28.082476
License: Public Domain

Bigelow, C. J.
The note declared on is clearly tainted with usury. It first became an operative contract, binding on the parties, when it was taken and received by Tucker, and he made a loan of money upon it. He did not purchase a valid, subsisting note, but advanced money on a promise which was without validity as a contract until it passed into his hands. Sylvester v. Swan, 5 Allen, 135. Clapp v. Rice, 13 Gray, 403. The *140defence of usury is open to the defendant in this action, although the plaintiffs are bona fide indorsees for value, without notice, unless the rule of law as to past contracts alleged to be usurious was changed by St. 1863, c. 242.* Kendall v. Robertson, 12 Cush. 156. Knapp v. Briggs, 2 Allen, 551. The decision of the court, therefore, turns on the single question whether this statute is prospective in its operation, or can be so construed as to affect contracts which were made before its enactment. Of the proper answer to be given to this question, there can be no doubt. The statute is equivocal and ambiguous in its terms, and might without doing violence to the words in which it is expressed be construed as retroactive. But such is by no means its necessary interpretation. On the contrary, it will have full meaning and effect, consistent,with the fair import of its language, if it is held to be prospective only. The true rule of interpretation applicable to such enactments is well settled, and has been often recognized and affirmed by this court. It is, that all statutes are to be considered as prospective, and are not to be held to prejudice or affect the past transactions of the subject, unless such intention is clearly and unequivocally expressed. Whitman v. Hapgood, 10 Mass. 439. King v. Tirrell, 2 Gray, 331. Gerry v. Stoneham, 1 Allen, 319, 323. Garfield v. Bemis, 2 Allen, 446. No good reason can be given for excepting the statute under consideration from the operation of this wise and salutary rule. It is not an enactment designed only to affect a remedy, or regulate the course of judicial proceedings ; but, if construed as operating retroactively, it would essentially impair the rights of debtors as to contracts existing before its enactment. The statute prescribing the rate of interest and prohibiting usury, and giving to debtors either a lawful claim to a deduction from the amount due on a usurious contract, or an action to recover the amount forfeited where usury *141has been paid, is not merely penal in its nature, or intended only as prescribing the form or mode of remedy. It creates a vested right or interest in the debtor, which he can insist upon and enforce, and which passes to his assignee in case of insolvency. This point was distinctly adjudicated in Gray v. Bennett, 3 Met. 522. To a statute which, if construed as operating retrospectively, would essentially impair this right, the rule that requires its language to be interpreted as intended to operate prospectively only is eminently applicable.

Plaintiffs nonsuit.

 This statute is as follows: “ Usury between the payee and the maker of a promissory note, payable on time, shall not be a defence to an action thereon, brought by the indorsee to whom the same was indorsed before maturity, for value, and without notice, express or implied, of the usury.”