Blaine v. Curtis

• Decision Date: 20 January 1887
• Citation: 59 Vt. 120,7 A. 708
• Parties: BLAINE v. CURTIS.
• Court: Vermont Supreme Court

7 A. 708

59 Vt. 120

BLAINE

v. CURTIS.¹

Supreme Court of Vermont.

January 20, 1887.

Exceptions from Orange county court, December term, 1884, Rowell, J., presiding.

Action of debt to recover the penalty given by the statute of New Hampshire for taking usury. Heard on general demurrer to the declaration. The county court sustained the demurrer, and adjudged the declaration insufficient, to which the plaintiff excepted. The facts appear in the opinion.

Roswell Famham, for plaintiff.

This action is transitory. There is nothing to make it local except its apparently penal character. There is nothing of a criminal character in an action under the statute in question. The state is not a party. It is not even a qui tarn action. 5 Wait, Act. & Def. 156; Railroad Co. v. Methven, 21 Ohio St. 586; Pierce v. Conant, 25 Me. 33; Palmer v. Lord, 6 Johns. Ch. 95; Cross v. Bell, 34 N. H. 82; Willie v. Green, 2 N. H. 333; Fife v. Bousfield, 6 Q. B. 100; 2 Chit. Pl. (16 Amer. Ed.) 285: Needham v. Railroad Co., 38 Vt. 294; Shedd v. Moran, 10 Bradw. 618; Leonard v. Columbia Steam Nav. Co., 84 N. Y. 48; Barney v. Burnstenbinder, 64 Barb. 212; Story, Conf. Laws, § 620. The New Hampshire statute is not one that relates solely to the remedy. It goes to the cause of action, and questions arising under it, and should be governed by the law of New Hampshire.

John H. Watson, for defendant.

The statute is penal. Ror. Int. St. Law, 166; Barnet v. National Bank, 98 U. S. 555. It is so regarded by the courts of New Hampshire. Harper v. Bowman, 3 N. H. 489; Kempton v. Sullivan Sav. Inst., 53 N. H. 581. Statutory penalties can only be enforced in the courts of the state by the laws of which they are imposed. They cannot be enforced elsewhere, either by the force of the statute, nor upon the principles of comity. Ror. Int. St. Law, 148; Ogden v. Folliot, 3 Term R. 733. An action will not lie in the courts of one state for the recovery of a penalty given by the laws of another state, upon usurious contracts made and entered into in such other state. Ror. Int. St. Law, 165. The action being local, the objection is properly taken by demurrer. 1 Chit. Pl. 278.

WALKER, J. The case comes before us upon general demurrer to the declaration, and the only question to be decided is whether the forfeiture imposed by the laws of New Hampshire upon a person receiving interest at a higher rate than 6 per cent. may be enforced by an action of debt, in favor of the person aggrieved, in this state. The provisions of the statute, which are substantially set out in the declaration, are as follows: "If any person, upon any contract, receives interest at a higher rate than 6 per cent., he shall forfeit three times the sum so received in excess of said 6 per cent. to the person aggrieved who will sue therefor."

It is alleged, in substance, in the declaration, that the defendant, at Piermont, in the state of New Hampshire, received upon a promissory note for the sum of $1,500, then held by the defendant and owing by the plaintiff to her, $30 interest in excess of 6 per cent. from the plaintiff on the first day of May in each year for six years, beginning with May, 1876, and ending with May, 1882; making $180 thus received by the defendant of the plaintiff in excess of 6 per cent. interest during the years named. It is also alleged that, by virtue of the statute of New Hampshire aforesaid, an action hath accrued to the plaintiff to recover of the defendant three times the excess of 6 per cent. interest so paid.

The case stated comes within the statute declared upon, and, if the suit had been instituted in New Hampshire, there could be no doubt of the right of the plaintiff to recover, if the action is not barred in that state by the statute of limitations. The question here is, can the liability imposed by the statute be enforced out of the limits of New Hampshire? This must depend on the nature of the liability, and the manner in which it is created. It is not a responsibility ex contractu; and the question arises, is it a liability imposed by the statute upon a person receiving illegal interest for a violation of its provisions, and penal in its nature, or is it a statute declaratory of a common-law right, and a means or way enacted for enforcing it, and therefore remedial in its nature?

If it only gave a remedy for an injury against the person by whom it is committed to the person injured, and limited the recovery to the mere amount of loss sustained, or to cumulative damages as compensation for the injury sustained, it would fall within the class of remedial statutes. 1 Bl. Comm. 86; Lake v. Smith, 1 Bos. & P. (N. R.) 179, 180; Woodgate v. Knatchbull, 2 Term R. 154, 155, note; Pinkney v. Rutland Co., 2 Saund. 376, note 7; Shore v. Madisten, 1 Salk. 206; Boice v. Gibbons, 8 N. J. Law, 324; Burnett v. Ward, 42 Vt. 80.

But this statute does not limit the recovery to the mere amount of the loss sustained, or to cumulative damages as compensation. It goes beyond, and inflicts a punishment upon the offender. It makes the taking of illegal interest an offense, and prescribes a penalty of three times the amount of illegal interest taken. The right of action under it does not arise out of any privity existing between the person paying and the person receiving the illegal interest, but is derived entirely from the statute. The action given is not to recover back money that the person receiving had no lawful right to take and hold against the person paying it, but one to recover a penalty for a breach of a statute law, and founded entirely upon the statute imposing the forfeiture.

It was held in Hubbell v. Gale, 3 Vt. 266, that whatever may be the form of the action, if it is founded entirely upon a statute, and the object of it is to recover a penalty or forfeiture, it is a penal action. We think the liability created by the statute declared upon is clearly a statutory one, imposed upon the person receiving illegal interest as a wrong-doer, and penal in its nature.

This view is supported by the decisions of many courts of last resort, some of which have been cited in the argument. We refer, however, only to a decision of the supreme court of the United States in a case analogous to the case at bar. The provisions of the act in question are similar to the provisions of the national currency act of congress, approved June 3, 1864, which provides that, if unlawful interest is received by any banking association created by it, the person or persons paying the same, or their legal representatives may recover back, in an action of debt, twice the amount of interest thus paid from the association taking or receiving the same. This provision of the currency act referred to came up for consideration by the supreme court of the United States in the case of Bamet v. National Bank, 98 U. S. 555, where ...