Court Opinion

ID: 5582271
Source: CourtListenerOpinion
Date Created: 2022-01-11 01:42:57.46435+00
Date Added: 2024-06-11T08:36:07.247360
License: Public Domain

Hill, J.
1. The facts are fully set out in the foregoing statement. Considering the case as made by the record, it was error to direct a verdict cancelling the deed. Even if the $200 note from Gresham to Long was infected with usury, it would not affect the deed from Martin and Davis to Long, it not appearing that the deed was infected with usury. It will be observed that the deed was not from Gresham to Long, but was from Martin and Davis-to Long. The deed is not void as being infected with usury, because there is no usury in the deed as between the grantors and the grantee, so far as the record discloses. In Scott v. Williams, 100 Ga. 540 (28 S. E. 243, 62 Am. St. R. 340), this court held: “While titles to property made as a part of a usurious contract are void, the right to set up the usury and have the conveyance declared void rests only with the maker and his personal representatives and privies. A stranger in interest will not be heard in an attack on a title claimed to be void for usury.” Mr. Justice Little, in delivering the opinion of the court, said: “The doctrine is well settled that the defense of usury can only be taken by the party to the usurious agreement, or persons representing him as privies in blood or estate. A stranger can not set up usury as a defense to an action. Tyler on Usury, p. 403. The plea of 'usury is a personal one, and no one can plead it but the borrower and his privies. Ryan v. Am. Freehold Mortgage Co., 96 Ga. 322 [23 S. E. 411]; Zellner v. Mobley, 84 Ga. 749 [11 S. E. 402, 20 Am. St. R. 390]. A title may be absolutely void between certain persons, and not void as between others. 84 Ga. supra; see also Jones on Mortgages, § 644.” And to the same effect, see Pickett v. Farmers & Merchants Bank, 147 Ga. 674 (95 S. E. 253). Whatever usury, if any, may have been in the promissory note executed by Gresham to Long could not affect the deed from Martin and Davis to Long, as the parties to that contract are entirely different, and it does not appear that the deed was tainted with usury in *173any way. Dotterer v. Freeman, 88 Ga. 479, 496 (14 S. E. 863); Pope v. Heartwell, 79 Ga. 482 (5 S. E. 487); Bugg v. Russell, 75 Ga. 837.
2. Is the waiver of homestead in the $200 note given by the plaintiff to the defendant void, in view of the act of 1916 (Acts 1916, p. 48), which was passed subsequently to the .execution of the note containing the waiver, and which repealed sections 3438 and 3442 of the Civil Code of 1910 (regulating forfeiture where usury is charged, and declaring that all .titles to property made as part of a usurious contract, or to evade the laws against usury, are void), and which also substituted in lieu of such penalty one to the effect that any .person, company, or corporation violating, the provisions of section 3436 of the Code of 1910 shall forfeit only the entire interest so charged or taken, or contracted to be reserved, charged, or taken? Prior to the act of 1916- a waiver of homestead and exemption right, even though such right was inchoate only, was valid and binding on the person making the waiver when the right became complete. Brit such waiver was void if embraced in a promissory note infected with usury. Prather v. Smith, 101 Ga. 283, 287 (28 S. E. 857). The law on the subject of interest which was in existence at -the time of the execution of the $200 note, said to be infected with usury, is the act of 1879 (Acts 1878-9, p. 184), and the first section of the act is embodied in section 3436 of the Civil Code of 1910, as follows: “It shall not be lawful for any person, company, or corporation to reserve, charge, or take for any loan or advance of money, or forbearance to enforce the collection of any sum of money, any rate of interest greater than eight per centum per annum, either directly or indirectly, by way of commission, for advances, discount, exchange, or by any contract or contrivance or device whatever.” This section is still of force. It was affected by the act of 1916, supra,. only so far as the act provided that any person, company, or corporation violating its provisions should forfeit only the entire interest so charged or taken, or contracted to be reserved, charged, or taken; and' it did not make void a deed infected with usury and which was given as a security for debt.
But the question now for decision is whether the act of 1916 was intended by the legislature to be retroactive and apply to notes which were already in existence when the repealing and *174amending act of 1916 was passed. In Maynard v. Marshall, 91 Ga. 840 (18 S. E. 403), a case somewhat similar in its facts to the present, Chief Justice Bleckley, said: “Ours is a case in which the legislative declaration that the contract is unlawful is left standing upon the statute book, unmodified and unrepealed. Indeed, if this were not so, it would be difficult to abide by the principle of several decisions made by this court, and yet treat contracts as gaining a legal status by the repeal of usury laws when they did not have it at the time the parties contracted. See Shealy v. Toole, 56 Ga. 210; Campbell v. Murray, 62 Ga. 86; Broach v. Kelly, 71 Ga. 698. Are notes, deeds, etc., fatally vicious on account of usury, to become legally operative when the usury laws are repealed and again vicious when those laws are reinstated, and so continue to rise and fall as often as the policy of the State with respect to usury may change, or will the first change only take effect upon them and subsequent changes pass them by? We need not at present insist that the better and safer line of decision in respect to usurious contracts is the one which this court has heretofore adopted in the three cases just cited; because, whether the repeal of all usury laws would or would not infuse life into a contract which was not in it before, we can safely hold that where such laws are not repealed, so as to remove from the statute book all denunciation of such contracts as unlawful, they get no new life by an amendment of the law which can be fairly construed as intended to operate prospectively only. We thus reach the same result in the present ease, wherein the effect of the amending act of September 27th, 1881, has been made a direct question, .as was reached in Crane v. Goodwin, 77 Ga. 362, in which the direct question appears not to have been presented.” The principle ruled in the Maynard case, and those cited therein, is controlling in the present case. And see, in this connection, Croom v. Jordan, 20 Ga. App. 802 (93 S. E. 538). We are of the opinion, therefore, that the legislature in passing the act of 1916, supra, did not intend to make it retroactive, and that it does not affect the $200 note executed in 1912. It follows from what has been said that if the note is tainted with usury, the homestead waiver contained therein is void. Prather v. Smith, supra.
We are aware that there are outside authorities holding to the contrary of what is here ruled. See 39 Cyc 915 (C); Ewell v. *175Daggs, 108 U. S. 143, 151 (2 Sup. Ct. 408, 27 L. ed. 682), and cit. But whatever the rule may be elsewhere, we are bound by the former rulings of this court, which are contrary to the rule laid down in some outside jurisdictions; and therefore we think the court properly directed that the jury find that the homestead .waiver was void in the $200 note, which was tainted with usury and was unaffected by the act of 1916.
The plaintiff in error having obtained a substantial modification of the judgment of the court below, it is directed that the costs of bringing the ease to this court be adjudged against the defendant in error.

Judgment affirmed in part and reversed in part.

ATI the Justices concur, except