Barnet v. National Bank
| Decision Date | 01 October 1878 |
| Citation | 98 U.S. 555,25 L.Ed. 212 |
| Parties | BARNET v. NATIONAL BANK |
| Court | U.S. Supreme Court |
ERROR to the Circuit Court of the United States for the Southern District of Ohio.
The facts are stated in the opinion of the court.
Submitted on printed arguments by Mr. R. B. Wilson, Mr. Samuel Shellabarger, and Mr. Jeremiah M. Wilson, for the plaintiffs in error, and by Mr. M. B. Hagans for the defendant in error.
The bank brought this suit upon a bill of exchange, dated Nov. 18, 1873, for $4,000, drawn by David Barnet upon Barnets & Whiteside, in favor of Robert Marshall, and payable ninety days from date, at the Second National Bank of Cincinnati, Ohio. It was accepted by the drawees, indorsed by the payee, and discounted by the Muncie National Bank of Indiana. Before the maturity of the bill the acceptors made an assignment to David Barnet and Isaac E. Craig, the plaintiffs in error. The suit was commenced in the Court of Common Pleas of Preble County, Ohio, against all the parties to the bill. The assignees intervened and made themselves parties. After the pleadings were made up, the case was removed by the bank to the Circuit Court of the United States for that district. There new pleadings were filed on both sides. The assignees set up three defences: 1. That Barnets & Whiteside were borrowers from the bank as early as Jan. 11, 1866; that the indebtedness was continuous and unbroken from April 8, 1866; that it was at no time less than $4,000, and amounted at one time to $36,000; that at the time of the assignment it was $28,000, upon bills of exchange which represented it; that the bank had taken not less than $5,000 in excess of the legal rate of interest; that for evasion the bills were arranged in series, and that each series was terminated from time to time by refusing to renew and the discounting of a new bill, the proceeds of which were applied in payment of the prior terminating one; that the bank had received satisfaction of all the bills but the one in suit, and that there was nothing due from the defendants. 2. That the bill in suit was the last of eight renewals; that illegal interest was taken upon the series to the amount of $1,116, which it was claimed should be applied as a payment upon the bill in question. 3. That fifty-one bills of exchange of $4,000 each, having ninety days to run, were discounted by the bank for the assignors, the first bearing date March 27, 1872, and the last, July 27, 1873 (the date of each one is given); that illegal interest was taken upon these bills to the amount of $6,324; and that the assignees are entitled to recover double this sum from the bank, to wit, $12,648. There is a prayer for judgment accordingly, and for other proper relief.
Marshall, the payee and indorser of the bills, also filed an answer; but as the record discloses no question raised by him, it need not be more particularly adverted to.
The bank demurred to the several defences set up by the assignees. To the first and third the demurrer was sustained, and overruled as to the second. Upon the latter the plaintiff took issue, and the case was tried by a jury. The jury rendered a verdict in favor of the bank for $4,080.31, and judgment was given accordingly. It does not appear that any thing done by the court touching this trial was objected to by the plaintiffs in error. There is no bill of exceptions in the record.
But one point has been insisted upon by the plaintiffs in error in this court, and it is that the Circuit Court erred in sustaining the demurrers to their first and third defences. That is the only subject before us for examination.
All questions arising under the second defence have been disposed of by the verdict and judgment. How the jury reached their conclusion it is not easy to see, but this is not material, as nothing relating to that part of the case is open to inquiry.
The national currency act of Congress of June 3, 1864 (13 Stat. 99, sect. 30), after prescribing the rate in interest to be taken by the banks created under it, declares:——
'And the knowingly taking, receiving, reserving, or charging a rate of interest greater than aforesaid shall be held and adjudged to be a forfeiture of the entire interest which the note, bill, or other evidence of debt carries with it, or which has been agreed to be paid thereon; and in case a greater rate of...
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