Court Opinion

ID: 6503533
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:16:00.648769+00
Date Added: 2024-06-11T15:54:40.451858
License: Public Domain

DARGAN, J.
The first question presented by the assignment of errors, is, whether Ferrand was a competent witness, after he was released from all liability or claim by Jones, on account of the two notes executed by him to the plaintiff, in the name of the firm of Jones & Ferrand, and which formed the consideration of the note sued on. We are not able to perceive what interest Ferrand had in the suit, after the execution of the release. The firm notes had been taken up by Jones, he giving his individual note in payment of them. Jones had the right to demand of Ferrand his proportion of those two notes, because they were partnership notes, and had been paid by Jones individually. But if Jones releases Ferrand from his liability to account for his part of those two notes, he surely can have no interest in the suit, for he is discharged by Jones from all claim, and Jones has paid the partnership debt. If he has any interest, it is rather on the side of the plaintiff, than the defendant who called him; for if the note sued on is not recovered, his liability on the two old notes maybe revived in favor of Jackson, the plaintiff: but if the plaintiff recovers in this suit, the witness is discharged from all liability whatever. It was said however, in the argument, that by defeating the note sued on, the dividend to be divided between the partners, would be increas*126ed; but this is not so. By the release Jones executed to Ferrand, the debt, which was a firm debt, becomes the individual debt of Jones, and if there be a dividend, it will be divided as if this debt had never existed, or as if it had at all times been the individual debt of Jones, and for which the firm was never liable. Ferrand can therefore have no interest, being released, in defeating the note sued on ; but might have an interest in enforcing its payment, to prevent the revival of his liability to Jackson upon the notes, which were the consideration of this note.
Nor can we perceive any error in the instructions given by the judge to the jury. By the act of 1834, Clay’s Dig. 591, usury avoids the entire interest, both the legal and illegal, agreed to be paid; but the principal actually lent is recoverable. The charge of the court clearly conveyed to the jury, ■ this idea, if they came to the conclusion, that the original notes were usurious, and that the note sued on was given in lieu of them, and any interest was computed on the old notes, and carried into the new note, then the note sued on was usurious, and that they could not allow any interest at all, but the amount of the recovery, must be confined to the amount expressed in the face of the original notes, which was the amount actually lent.
It is certainly the law, that merely giving a new security, will not purge the taint of usury, if it existed in the original contract. But if the usurious contract was abandoned, and the parties agree that the principal, and lawful interest shall only be paid, then the consideration of the loan, would support this promise : or, in other words, the contract would be purged of the usury. See 6 Wendell, 415; 15 Mass. 96; 6 Monroe, 553; 10 Wheaton, 367. But here there was no contract, or extension to purge the original contract, of the offence of usury. Jones did not know that the contract was usurious ; the usurious interest had been paid, and the defendant agreed to pay the principal debt, and lawful interest, not knowing that he was not bound to pay the interest, for he did not know of the usury. The plaintiff knew it, but it does not appear that it was disclosed to Jones. Under such circumstances, it cannot be said that Jones agreed to purge the original contract, of the usury that attached to it, or ex*127isted in it. But we come to the conclusion, that the court erred in permitting Jones, the defendant, to' testify that the note sued on, was given in lieu of the two notes of the firm of Jones & Ferrand, to the plaintiff, and on no other consideration.
.By the statute, the borrower, or party to the usurious contract, is a competent witness to prove the offence of usury, unless the party will deny under oath, the statement of facts, to Avhich the borrower proposes to testify. See Clay’s Dig. 590. But to authorize the party to testify, he must propose to give evidence of the offence of usury, or that the contract was usurious; if he does this, he may state all the attendant circumstances, that will show the .offence to be complete. See 6 Ala. R. 753; 8 Ala. R. 53. But he is not permitted by the statute, to give evidence of a distinct, and independent fact only, and then to prove the offence by other Avitnesses. He is rendered competent by the statute to prove the of-' fence, and if he cannot testify to the offence, the statute does not render him competent to testify to any other distinct matter. Here the defendant was not offered to prove the of-fence, but the offence was proved by a witness. The defendant knew nothing of it of his own knowledge, but he was permitted to connect the offence thus proved, with the note on which he was sued. In this the court erred, and the consequence is, that the judgment is reversed, and the cause remanded.