Court Opinion

ID: 7970223
Source: CourtListenerOpinion
Date Created: 2022-09-09 00:54:27.800402+00
Date Added: 2024-06-11T16:34:45.229636
License: Public Domain

BUCK, J.
(dissenting).
I dissent. In order to constitute usury, there must be paid, or an agreement be made to pay, a greater rate of interest than is allowed by law, coupled with a corrupt intent on the part of the lender to take more than the legal rate of interest for the use of the sum loaned. There must be an intention knowingly to contract for or to take usurious interest, because, if neither party intend it, the law will not infer a corrupt agreement between the parties.
That usury is placed under the ban of the law is doubtless a wise provision, in view of the rapacity of capitalists, and the temptation of the money loaner to take advantage of the necessities and improvidences of the borrower. But the temptation of the borrower frequently to evade the payment of an honest debt is growing to alarming proportions in the commercial world, and just where is the dividing line between usury and the legal obligation to pay for money borrowed and used, is sometimes difficult of solution. That the law must be observed when the corrupt intent appears to get more money than the law allows admits of no argument; but formerly, when a man borrowed hundreds or thousands of dollars, and used the same for his own benefit or pleasure, equity was the rule,— that he should at least pay back what is justly and in good faith due, viz. the principal and legal interest. While the law seems to have superseded equity, and allows the borrower to enjoy the luxury of living upon and enjoying other people’s money, the facts ought to be conclusive that warrant him in so doing.
This is, in my opinion, no such case. It is conclusively one to the contrary. The money was loaned through an agent, one Titus. The lender was one Carpenter. Carpenter denied authorizing Titus to take any usury, or that he ever received any, and the defendant borrower testified as follows:
“Q. You told him [Titus] you would give him seventy-five dollars if he would get the money for you? A. He told me his charge would be seventy-five dollars. Q. And you told him you would give it to him for getting you the money? A. Yes, sir. Q. He didn’t say the lender wanted seventy-five dollars additional, did he, or five per cent, in addition? A. I don’t remember that he said anything of that kind. Q. It was for the purpose of paying Mr. Titus his compensation for doing the work, was it not? A. That was what he charged for getting it. Q. That was the agreement between *546you and him that Mr. Titus himself was to have $75 for getting the money for you? A. He charged ten per cent, per annum and five per cent, commission on the loan. Q. Did he assume to charge you any interest at all? A. I would not have paid him if I hadn’t agreed to. Q. What was this $75 for? A. It was a commission or bonus, or something of that sort. Q. To pay whom? A. To pay himself. Q. To pay Mr. Titus? A. I suppose so. Q. For what purpose? A. Well, I don’t know. You can’t hardly prove that with me. It is customary among loaning agents to charge what they call a ‘bonus’ or ‘commission.’ Q. For procuring the money? A. Well, I don’t know whether it is for procuring it or not. They make that charge for extra compensation in some way. Q. You know as a matter of fact it was for the purpose of paying Mr. Titus for doing the work? A. What I think about is this— Q. What do you know about it? A. Well, it was his compensation— Q. His principal took the ten per cent, interest? A. I think so, yes. Q. You don’t claim any part of that $75 went to the principal, do you? A. I don’t know as to that.”
If, with such evidence as this, substantially uncontradicted, money loaners can be deprived of théir money loaned, it is difficult to see where the matter will end. The temptation to perjury on the part of the borrower is equally as great as the temptation to exact usurious interest on the part of the lender, though the defendant borrower cannot be charged with false swearing in this case, for he frankly admits that the money was paid to the agent Titus for getting the money for defendant, and that he had no knowledge that it ever went to Carpenter or was for his benefit.
The order should be reversed.