Bank of College View v. Nelson

• Decision Date: 06 May 1921
• Docket Number: 21453
• Citation: Bank of College View v. Nelson, 106 Neb. 129, 183 N.W. 100 (Neb. 1921)
• Parties: BANK OF COLLEGE VIEW, APPELLANT, v. J. F. NELSON ET AL., APPELLEES
• Court: Nebraska Supreme Court

183 N.W. 100

106 Neb. 129

BANK OF COLLEGE VIEW, APPELLANT, v. J. F. NELSON ET AL., APPELLEES

No. 21453

Supreme Court of Nebraska

May 6, 1921

APPEAL from the district court for Lancaster county: WILLARD E STEWART, JUDGE.Affirmed.

AFFIRMED.

Fred C Foster, O. K. Perrin and S. M. Kier, for appellant.

Hall Baird & Williams, contra.

OPINION

ROSE, J.

Plaintiff is a state bank.It brought this action on two promissory notes, one for $ 1,390 and the other for $ 400.Defendants had executed and delivered the notes, which were due and unpaid, and made no defense to them, but pleaded a counterclaim for damages amounting to $ 17,500 for the breach of a contract obligating plaintiff to lend them approximately $ 6,500 for the specific purpose of constructing a garage on lots owned by them in College View.The answer to the counterclaim alleged that the contract for the loans was unlawful and void because performance required the violation of a statute prohibiting plaintiff from lending to an individual more than 20 per cent. of its capital and surplus.Rev. St. 1913, sec. 312.The facts pleaded by plaintiff in the answer to the counterclaim were put in issue by a reply.The trial court directed a verdict in favor of plaintiff for the amount due on the notes--$ 2,056.27.On the counterclaim for damages the jury rendered a verdict in favor of defendants for $ 2,056.37.Defendants recovered a judgment for 10 cents, the difference between the two items.Plaintiff has appealed.

The issues of fact and the amount of the damages resulting from plaintiff's breach of the contract to make the loans were, upon sufficient admissible evidence, settled by the jury in favor of defendants.

Was the contract void in the sense that plaintiff could violate it without becoming liable for resulting damages?In limiting the amount of an individual loan to 20 per cent. of the capital and surplus and in directing punishment for exceeding that limit, the statute established a rule for the government of the bank.Rev. St. 1913, sec. 312.The penalty for violating the act applies to "any officer, director, or employee" of the bank.An excessive loan does not subject the borrower to a penalty.He does not stand before the statute in the same light as the offending banker.The penalty is a matter between the state and the lender.The general rule is that an excessive borrower cannot prevent the collection of his debt by pleading and proving a violation of the statute.In demanding performance of the bank's contract for an excessive loan, the borrower is not in a worse situation than the banker who is subject to a penalty for violating the law governing the...