Court Opinion

ID: 8035499
Source: CourtListenerOpinion
Date Created: 2022-09-09 03:20:20.350221+00
Date Added: 2024-06-11T16:36:54.356436
License: Public Domain

Good, J.,
dissenting.
I have no criticism to make of the principles of law, as announced in the syllabus of the majority opinion. Some important facts are overlooked which, in my opinion, when fairly considered, require an affirmance of the judgment of the district court, instead of its reversal.
• This is a law action, in which the parties waived a jury and tried the cause to the court. Under such circumstances, the finding of the trial court has the same force and effect as the verdict of a jury. McCarter v. Cover, 122 Neb. 691, same case in 122 Neb. 833; Bliss v. Peters Nat. Bank, 122 Neb. 76; Cook v. Moats, 121 Neb. 769; National Cash Register Co. v. Chipman, 122 Neb. 866; Nebraska Nat. Bank v. Parsons, 115 Neb. 770. •We have further held that in an action at law, tried to the court without a jury, where there is sufficient evidence in support thereof, the finding of the court has the *520same effect as the verdict of a jury and will not be disturbed on appeal, unless clearly wrong. Ayres v. Atlas Ins. Co., 123 Neb. 285; Farmers Cooperative Mercantile Co. v. Shultz, 113 Neb. 801; Prime v. Squier, 113 Neb. 507; Peterson v. State, 113 Neb. 546; Young v. Johnson & Blind, 113 Neb. 149.
The real controversy in this action was whether the promissory note, the basis of plaintiff’s action, was tainted with usury. The record reflects the following facts:
Defendant purchased from Hayes, an automobile dealer, an automobile for $550, trading in a used car for $250, and for the difference gave his promissory note for $376, payable in 16 instalments of $23.50 each. The first instalment was due in 6 days, the last instalment in 15 months and 6 days. The average time the instalments ran was 7.7 months. In other words, plaintiff, for the use of $300 for the term of 7.7 months, was paying $76, or at a rate of more than 39 per cent, per annum. Hayes was not able to finance transactions of this sort, and did not sell automobiles on time, except in form. He was the agent of the plaintiff, or at least had an arrangement with the plaintiff whereby he kept a supply of its blank mortgages, notes and forms, and made loans under such circumstances, making notes payable to himself, and immediately indorsing them to the plaintiff. In the instant case, before the deal was completed, Hayes, in the presence of defendant, called up plaintiff, to know precisely the amount for which the note would have to be drawn and the rate at which paid in instalments, and secured the information, which resulted in the giving of the note for $376. This note was made payable to Hayes, was immediately indorsed and transferred to the plaintiff. The evidence also shows that Hayes received from the plaintiff a commission out of the loan thus made, and was, therefore, the agent of plaintiff.
Section 45-105, Comp. St. 1929, with reference to usury, provides: “The acts and dealings of an agent in loaning money shall bind the principal, and in all cases where *521there is illegal interest by the transaction of the agent, the principal will be held thereby as if he had done the same in person.” And further provides: “Where the same person acts as agent for the borrower who obtains the money from the lender, he shall be deemed to be the agent of the loaner also.” The statute made Hayes the agent of the plaintiff. The law denounces as usury any rate in excess of 10 per cent, per annum, with certain exceptions, but the plaintiff is not within the excepted class. In my view, the transaction was a flagrant violation of the usury statute. It ought not to be upheld.
In the case of State v. Central Purchasing Co., 118 Neb. 383, paraphrasing the language there used, it is said (p. 389) : “The courts in such a case as this are not bound by forms but will look beyond form to the real substance. Looking through the scheme of the plaintiff to acquire and retain an unlawful and usurious rate of interest for the use of its money, and discerning the real substance of its transactions, we are of the opinion that its transactions pictured in the evidence were not bona fide purchases of rights of action from its customers, but rather were loans of plaintiff to its customers. As such they were strongly infected with usury, were unlawful, and were contrary to the public policy of the state.”
The contract rate was unlawful and unconscionable. The judgment of the district court is right, and it should be affirmed.