Court Opinion

ID: 6609098
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:16:46.240024+00
Date Added: 2024-06-11T15:58:17.479490
License: Public Domain

Dyer and Pitkin, JJ.,
dissenting. The issue joined was material: Eor the facts pleaded, and found by the jury, operate totally to destroy the plaintiff’s security, and bar a recovery thereon. Unless (as is objected in the motion) this borrowing and loaning, though described in the obligation itself to be on lawful interest, is incapable of drawing any interest whatever: For, if it is capable of drawing lawful interest, it is capable of addition, if the parties please. To suppose a contract which will carry the lawful interest, and at the same time cannot, by any possibility, be made to carry more, involves in it manifest absurdity. The loan that will draw sis per cent, may draw ten or twelve, if so agreed by the parties.
In the present case, if judgment is to be rendered for the plaintiff, will the court allow only the principal sum contained in the obligation, when, by the express contract of the parties, the same obligation equally secures the lawful interest thereon? Clearly, there can be no severance.— The second note of $1,000, is found by the jury to be only for the consideration of the first sum lent. Let a suit be commenced upon it, and upon the principles laid down in this case, a recovery must be. had for the whole sum. Will not the plaintiff, then, have recovered on the first suit, the principal sum loaned, and the legal interest; and will he not, on the second suit, have recovered a further sum of £300 lawful money? The second judgment is either nothing, or *264else it makes an addition above the six per cent, recovered by the first judgment.
The legislature well knew, that many arts and sub til lies have been invented and practiced by usurers, to evade the law. This occasioned the legislature to be circumspect, and attentive to defeat them; and to enact generally, and not particularize specific modes of usury, which lead to evasion. The statute, therefore, is,— “ That no person or persons whatsoever, upon any contract made, shall take; directly or indirectly, for loan of any moneys, wares, merchandise, or ■other commodities whatsoever, above the value of £6, for the forbearance of £100 for one year. And that all bonds, contracts, mortgages and assurances whatsoever, made for the payment of any principal, or money lent, or covenanted to be lent upon, or for usury, whereupon or whereby there shall be reserved, or taken, above the rate of '£6 in the £100, as aforesaid,— shall be utterly void.”- — -We might wish to save the plaintiff at least his principal in tins case, as it is a large sum; but the words and sense of the statute are too strong to be thus evaded. Eor, if in the present case, there is a security for any principal, and that principal is comprehended in any one of the expressions in the act referred to, viz. moneys, wares, merchandise, or any other-commodities, then it must be within the act.— If the plaintiff’s motion in arrest prevail, it will be a determination that final settlement certificates, are not a principal in the obligation on which this action is brought, and that they are not money, wares, merchandise, or any other commodity whatsoever; and yet that they are a principal on which interest is secured, and for which the court must render judgment for the plaintiff to recover.
*265The principal questions wliicb arise in tbe law authorities, are upon tbe distinctions between a mere bargain and a loan: Eor a simple bargain, though a hard one, is not within the statute against usury: And usurers have endeavored to evade the law, by disguising the loan under the specious show of a bargain, and possibly on some risk. The judges have often been put to difficulty to uncover this disguise; but whenever it is disclosed, it proves fatal.— In the present case, there is no cover as to the loan; for it is so expressed in the obligation, and to be on interest till paid. It is an essential part of the pleadings, and a fact found by the jury, that there was at the same time, an obligation given for a further sum of one thousand hard dollars, on no other consideration, than as an additional interest to the six per cent, secured by the first, or principal obligation; and by the corrupt agreement of the parties. These facts being found true by the j ury, the court have to determine whether the case is within the statute against usury. It is said not to be, because the note for $1,000, was in fact given to secure the depreciation only; and, therefore, it was all a bargain, and not in nature of a loan. — We find no precedents, or law authorities \\híúc\;u\ & wWiaftt- Q\\h QÍ the statute against usury, merely on account of the principal sum loaned being liable to become of less value at the time of payment, than at the time of the loan. True, that where the whole principal is at hazard on some contingency, such contract is not usurious; but that is not the present case. Consonant with these principles, were the whole course of judicial decisions in this state, during the term of the existence of what was called Old Tenor. This was a paper currency in a constant state of depreciation: Yet all obliga*266tions and loans, in that currency, were adjudged usurious, where they would have been so adjudged, if made in the established coin of the country.— A contrary construction of the law will entirely defeat the good design thereof, and open a door for every species of oppression which it is meant to prevent.