Bishop v. Exchange Bank
| Decision Date | 12 March 1902 |
| Citation | 41 S.E. 43,114 Ga. 962 |
| Parties | BISHOP v. EXCHANGE BANK. |
| Court | Georgia Supreme Court |
Syllabus by the Court.
1. An affidavit to the effect that the facts set forth in a plea are true is a sufficient verification.
2. Where a lender requires, as a condition precedent to making a loan upon which the full legal rate of interest is expressly charged, that the borrower shall assume and pay off a promissory note held by the lender against one who is known by the lender to be insolvent, and whose debt the borrower is under no obligation to pay, the transaction is usurious.
3. In a suit by the lender against the borrower, a plea setting up the above facts as constituting usury is good against a demurrer thereto.
Error from city court of Atlanta; H. M. Reid, Judge.
Action by the Exchange Bank against F. L. Bishop and another. Judgment for plaintiff, and Bishop brings error. Reversed.
Geo. P Roberts and Thos. L. Bishop, for plaintiff in error.
Rosser & Carter, for defendant in error.
The Exchange Bank brought its action against Bishop, as principal, and Johnson, administrator (whose intestate was surety), on a promissory note dated August 18, 1898, for $961, with interest at 8 per cent. per annum from date, and 10 per cent. attorney's fees. Bishop answered, admitting the execution of the note, its date and amount, and that payment had been demanded and refused, but alleging that when he applied to the bank for the loan the president informed him that he would lend the money, but that first Bishop must assume and pay off two notes, for $58.63 each, held by the bank against one Sprayberry, who was totally insolvent, and whose insolvency was well known to the president of the bank that the notes held by the bank against Sprayberry were in no way connected with Bishop's transaction with the bank and that Bishop had no interest in them, and was in no way bound, legally or morally, to pay them; but that the bank, through its president, for the sole purpose of charging usury, demanded that defendant should take up the notes and pay them off, the president knowing that the notes were totally worthless,--Sprayberry having failed a year or so previously, owing this amount to the bank. The answer further alleged that defendant was entitled to a credit on the note sued on for the amount of the Sprayberry notes, with interest on the latter from the time he paid them; that the demand and taking of the payment of the said notes by the bank, through its president, was merely an evasion of the usury laws of this state; and that, to this extent, defendant was not liable. Johnson filed a plea setting up reasons why the judgment against him should be quando acciderint. The plaintiff demurred to Bishop's answer on the ground that it was not pleaded with that certainty and definiteness which is required in a plea of usury, and because the averments of the plea did not show that there was any usury in the transaction. It also demurred on the ground that the affidavit to the plea simply deposed to the truth of the "facts" set out in the plea, without pointing out which of the averments or statements therein were facts. The demurrer was sustained, Bishop's plea stricken, and judgment entered up against the defendants. Bishop excepted to the striking of his plea.
1. By rule 24 of the superior courts of this state it is prescribed that, in the affidavit to pleas of the character of that here in question, the defendant shall swear or affirm that the "defense" therein contained is true, to the best of his knowledge and belief. Civ. Code, § 5655. The affidavit in the present case complied substantially with this rule, and the point made in hypercritical. While there may be a difference between verifying the facts in a plea and verifying the averments or allegations of fact therein, the difference is not substantial, and is no ground for holding that the plea in the present case was not sufficiently verified.
2. While the judgment sustaining the demurrer does not show upon which ground it was based, we conclude, from the argument in the briefs of counsel, that the main ground relied on in support of the demurrer was that the plea did not show that there was any usury in the transaction. Counsel for the plaintiff in error contended that the facts alleged in the plea were sufficient to constitute usury, and counsel for the defendant maintained a contrary position. We have no hesitation in deciding that under the allegations of the plea the transaction was clearly usurious. Our Civil Code (section 2886) declares that "it shall not be lawful for any person, company or...
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