Court Opinion

ID: 3632940
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:11:57.67974+00
Date Added: 2024-06-11T14:07:42.141188
License: Public Domain

With regard to the defence of usury, the judge charged the jury that, if they found the contract, upon which the note was given, was in good faith intended to be performed in Florida, and was made in reference to the laws of that State, said note was not usurious, though made in the State of New York, and purporting to bear eight per cent interest on its face. There was no proof whatever of what rate of interest the laws of Florida allowed; and if it devolved on the plaintiff to prove this, I am inclined to think the charge erroneous; otherwise, it was correct. He was right in assuming *Page 485 
that the legality of the rate of interest was to be determined by the laws of Florida; but are we to presume that they allow interest at the rate of eight per cent? The opinion delivered in the Supreme Court either assumes that it was proved that the laws of Florida allow this rate of interest, or dispenses with the necessity of proving it.
It is a well established rule that foreign laws are regarded as facts, and should be alleged and proved like other facts of which the courts do not take judicial notice; and, in the absence of such allegations and proofs, our courts will presume that the foreign laws are in accordance with our own. In Leavenworth v.Brockway (2 Hill, 201), to which we have been referred, the action being on a promissory note, payable at the Franklin Bank, Columbus, Ohio, the plaintiff claimed to recover interest from the time the note fell due, at the rate of six per cent interest, to which the defendant objected, insisting that the plaintiff must prove the note drew interest by the laws of Ohio, and must recover according to the rate established there. The circuit judge overruled the objection, and the decision was sustained by the Supreme Court. The point sustained was, that the New York rate of interest would have been the proper allowance under the existing state of proof, had not the plaintiff voluntarily relinquished one per cent. In the note to this case, several authorities are quoted to show that, where a note is made in another State, or pursuant to a contract to be fulfilled in another State, interest will be allowed according to our laws, where there is no averment of the laws of the foreign State, or that interest is there recoverable.
But where a party insists upon a forfeiture, upon the ground that he is entitled to it by the laws of a foreign State, because, in similar instances, a forfeiture is allowed by the laws of this State, will his claim be recognized without proof of the law of the foreign State? Would not this be a presumption in favor of a forfeiture? It does not follow, because a plaintiff will be allowed interest on a foreign note at the rate allowed in this State, in the absence of proof of what the foreign State allows, that the defendant will be sustained in alleging a total forfeiture *Page 486 
of the debt, without proving, on his part, that the interest agreed upon exceeds the rate allowed in the foreign State, and that this excess, by the laws of that State, creates a forfeiture of the debt. In Kentucky, where a note, made in Maryland, was alleged to be usurious, and there was no proof showing what the law of Maryland was upon that subject, it was held that the court could not pronounce the note usurious. (Greenwade v.Greenwade, 3 Dana, 495.) "It is clear," say the court, "that the laws of Maryland govern the contract. If usurious or void, in whole or in part, it must be made so by the laws of that State, and not by the laws of Kentucky. What may be the legal rate of interest in Maryland, and whether any, and, if any, what law existed in said State against usury when this contract was made, this court cannot judicially know. These are facts to be averred and proven like other facts." In Thompson v. Ketchum (8 J.R., 190), where infancy was set up as a defence to a note made in Jamaica, and the defendant proved that he was under twenty-one years of age when it was executed, it was held that the onus
lay with him to show, further, that, by the law of Jamaica, the defence was sustainable. "The court cannot know, ex officio," says KENT, Ch. J., pronouncing the opinion of the court, "what are the rights and disabilities of infants, or when infancy ceases, by the provincial law of Jamaica. These questions depend much upon municipal regulations; and what the foreign law is, must be proved as a matter of fact. This was so ruled by Lord ELDON, in Male v. Roberts (3 Esp. N.P., 163). The defendant was bound to make out a valid defence; and it therefore lay with him to show that this plea of infancy was good by the law of Jamaica." So, in the case before us, the defendant was bound to make out his defence by showing that, by the law of Florida, it was unlawful to reserve eight per cent per annum upon the loan or forbearance of money. The party seeking advantage from a foreign law, imposing a penalty or a forfeiture, must prove its existence; and this is perfectly consistent with the principle that, ordinarily, on a common law question, the law will be assumed to be *Page 487 
the same as that of the State where the court adjudicating upon the matter sits.
The result, therefore, at which the Supreme Court arrived, on this branch of the case, was correct; although the true ground upon which it depended seems to me to have been ignored or overlooked.
With regard to the defence of the statute of limitations, the Supreme Court deals with it as if the various absences of the defendant set up in the reply were regularly proved. We have seen that there was no proof whatever at the trial on this subject; and although there is no allusion to the want of proof in the opinion of the court, we must suppose it was considered that the demurrer to the reply admitting those absences dispensed with the necessity of proof. Is the proof of the several absences stated in the reply rendered unnecessary because the defendant demurred to that part of it which alleged those facts? It will be borne in mind that, in the case before us, the demurrer was argued and decided at the special term; the demurrer was overruled and judgment for the plaintiff ordered, with leave to the defendant to withdraw the demurrer on payment of costs. The costs were not paid; but the parties proceeded to try the issues of fact before a jury in the usual way — the plaintiff thus waiving the conditions upon which the defendant was allowed to prove his defence. Undoubtedly a demurrer admits all such matters of fact as are sufficiently pleaded; and the only question for the court, on the argument of the demurrer, is, whether, assuming those facts to be true, they sustain the case of the party by whom they are alleged. But this admission is effectual only for the purpose of the argument, in that branch of the court where it takes place; and when the demurrer is overruled, with permission to the demurring party to withdraw it on certain conditions, the opposite party can enforce the conditions. If he consents, however, without doing this, to proceed to the trial of the issues of fact, the admissions imputed by the demurrer being merely hypothetical for the purpose of the argument, he is bound, in the absence of any stipulation or order to the contrary, to prove his facts precisely *Page 488 
as if there had been no demurrer. Proceeding to try the issues of fact before a jury is practically a withdrawal of the demurrer; it thus ceases to be a part of the record, and its admissions are no longer available for, or against, either party.
What, then, has the plaintiff alleged and proved in answer to the assertion of the defendant that the debt is barred by the statute of limitations?
The note became due on the 1st of May, 1844, and on the 15th of May, 1851, the plaintiff caused a summons to be placed in the hands of the sheriff of New York, with directions to serve the same, intending to have it served as soon as the defendant returned from California, where the plaintiff then was, and where the plaintiff knew he was. If we are to take the 15th May, 1851, as the proper time for the commencement of the action, it would leave a period exceeding six years. But it was really commenced only when the summons was actually served on the defendant on the 30th August, 1851. Section 99 of the Code declares that "an action is commenced as to each defendant when the summons is served on him, and that an attempt to commence an action is deemed equivalent to the commencement thereof, within the meaning of the title, when the summons is delivered, with the intent that it shall be actually served, to the sheriff, c., of the county in which the defendants, or one of them, usually or last resided. But such an attempt must be followed by the first publication of the summons, or the service thereof, within sixty days." In this case, there was no publication of the summons; and it was not actually served until the expiration of more than double that time; so that, as far as we can judge from the state of the evidence and admissions, more than six years elapsed, after the cause of action accrued, before the action was commenced — the plaintiff failing to show anything to save his case from the operation of the statute.
From these considerations, I am of opinion that the judge, at the trial, erred in refusing to charge that "the note appearing on its face to be due more than six years before the commencement of this action, and no evidence having been given of any *Page 489 
fact to take it out of the statute of limitations, the jury were bound to find for the defendant."
The judgment of the Supreme Court should be reversed, and a new trial ordered.
COMSTOCK, Ch. J., SELDEN, DENIO, DAVIES, and BACON, Js., were for affirmance; putting their judgment, in respect to the question of usury, as well upon the ground stated in the opinion of CLERKE, J., that the defendant was bound to allege and prove the foreign law which rendered the contract usurious, as upon the ground that it was assumed in the court below, as proved or admitted, that the law of Florida allowed interest to be reserved at the rate of eight per cent. COMSTOCK, Ch. J., concurred in the position of SELDEN, J., that usury could not be predicated of a sale of land with a stipulation for larger interest on the deferred payments than that limited by statute upon a loan.
Judgment affirmed.