Court Opinion

ID: 7906758
Source: CourtListenerOpinion
Date Created: 2022-09-08 22:01:21.619194+00
Date Added: 2024-06-11T16:32:26.780427
License: Public Domain

Harvey, J.
(dissenting): I agree that, whatever might be the result measured by the practices of former times or the statutes of other states, this case should be determined by our statute, the pertinent portion of which is as follows: “The parties to any . . . promissory note . . . may stipulate therein for interest receivable upon the amount of such . . . note ... at a rate not to exceed ten per cent per annum . . .” (§ 5482 Gen. Stat. 1915.) A penalty is provided for charging a higher rate.
Now, let us apply the statute to this case. The amount originally loaned was $3,100. The note was dated January 1, 1909, was due one day after date “with 10 per cent per annum from date. If interest is not paid to become as principal and bear the same rate of interest.” It was not paid, nor settled for until December 14, 1912, 3 years, 11 months and 13 days after date. The interest, at the maximum rate named in the statute, and at the rate named in the note, for that time was $1,225.37, making the amount then due, $4,325.37. There was paid on that date, as alleged in the answer, $871.25, leaving a balance due of $3,454.12. A new note was then given for $3,647.96, which was $193.82 in excess of the balance due. This excess is conceded to be an interest charge of some kind and not an additional loan. It is contended by the creditor that this excess is justified by some process of computing interest, and his contention is approved by the majority opinion. To my mind, it is not material how it was computed. The bald fact remains that the second note contains $193.82 in excess of the maximum rate of ten per cent per annum named in the statute. No process of computation will authorize or justify an interest charge in excess of that provided by the statute.
This vice runs through all these notes, with the result that the interest in the note sued upon at the time judgment was rendered, in excess of the maximum of ten per cent authorized> by the statute, is more than one thousand dollars. The statute should not be evaded by any process of computation or reasoning, but it should be followed and enforced.