Court Opinion

ID: 6544484
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:18:28.301059+00
Date Added: 2024-06-11T15:55:55.703691
License: Public Domain

Hughes, J., (after stating the facts)* The court held in Nevada County v. Hicks, 50 Ark. 416, that “the allowance of interest oil a judgment against a county is not a contract by the-county to pay interest, and does not violate-section 1, art.'16, of the constitution, which forbids counties to issue any interest bearing evidences of indebtedness." That a judgment against a county bears interest, whether mentioned in the judgment or not, at the rate of 6 -per cent, per annum (sections 4740, 4741, Mansfield's Digest, sections 5082, 5083, Sandéis & Hill’s Digest), unless the judgment is rendered upon a contract for more than 6 per cent, when it will bear the rate of interest the contract bore-(when it does not exceed 10 per cent., the lawful conventional rate, of course). Interest allowed on a judgment, where not stipulated for in the contract sued upon, is not by virtue of a contract, but is by operation of law, and in the nature of a penalty for delay in payment of the principal, after it becomes due. By act approved the 21st of March, 1893, it is provided “that no judgment rendered or to be rendered against any county in the state, on county warrants, or other evidences of county indebtedness, shall bear any interest after the passage of this act." Sections 5082, 5083, Sandels & Hill’s Digest. The appellant thinks this act violates sec. 17 of art. 2, of the constitution, which provides that no ex post fado law, or -law impairing the obligation of contracts shall ever be passed, and the portion of sec. 8, art. 2, of the constitution which provides that no persons “shall be deprived of life, liberty or property without due process of law." These provisions are 'also contained in the constitution of the United States. In the case of Morley v. Lake Shore, etc., Railway Company, 346 U. S. 162, is to be found a case in point. It is as follows: “The court of appeals of the state of Hew York having held that -a judgment obtained before the passage of the act of the legislature of that state of June 20, 1879, reducing the rate of interest (Sess. Daws 1879, c. 538), is not a contract or obligation excepted from its operation under the provisions of § 1, this court accepts that construction as binding here." “The provision in sec. 10 of art. 1 of the constitution of the United States that no state shall pass ‘any law impairing the obligation of contracts’ does not forbid a state from legislating, within its discretion, to reduce the rate of interest upon judgments previously obtained in its courts; as the judgment creditor has no contract whatever in that respect with the judgment debtor, and .as the former’s right to receive, and the latter’s obligation to pay, exists only as to such amount of interest as the state chooses to prescribe as a penalty ox liquidated damages for the nonpayment of the judgment/'’ “A state statute reducing the rate of interest upon all judgments within the courts of the state does not, when applied to one obtained previous to its passage, deprive the judgment creditor of his property without due process of law, in violation of the provisions of sec. 1 of the fourteenth amendment to the constitution of the United States.” This decision is satisfactory to us, and fully answers the appellant’s contentions. The judgment of the Mississippi circuit court is in all things affirmed.