Cornwell v. McCoy

Decision Date19 November 1898
Citation6 Idaho 219,55 P. 240
PartiesCORNWELL v. McCOY
CourtIdaho Supreme Court

AGENCY - LOANING MONEY - INTEREST - COMMISSION-USURY.-M. applied to plaintiff by a written application, wherein he appointed plaintiff his agent for the purpose, to procure for him a loan of $600 for a period of five years, with interest at the rate of eight per cent per annum, payable annually. For his services in procuring said loan plaintiff charged M. a commission of ten per cent upon the sum so procured and loaned, M. and his wife giving to plaintiff their notes and mortgage to secure said sum. Held, that such charge for commission, in the absence of any proof showing that plaintiff was acting as the agent of party from whom said loan was procured, or that such party was interested in or received any part of the commission so charged, the same did not come within the provision of title 7, chapter 10, Revised Statutes of Idaho, and was not usurious.

(Syllabus by the court.)

APPEAL from District Court, Nez Perces County.

Judgment reversed, with costs to appellant. Cause remanded with instructions.

James E. Babb, for Appellant.

The special defense did not allege facts sufficient to constitute a defense. (Mackey v. Winkler, 35 Minn. 513, 29 N.W 337; Acheson v. Chase, 28 Minn. 211, 9 N.W. 734; Nichols v. Osborn, 41 N. J. Eq. 92, 3 A. 155; Thomas v. Miller, 39 Minn. 339, 40 N.W. 358; Secor v. Patterson, 114 Mich. 37, 72 N.W. 9; Merck v. American etc. Mtg. Co., 79 Ga. 213, 7 S.E 266-269.) Usury must be pleaded and must be established by evidence beyond a reasonable doubt. (Jones on Mortgages, 15th ed., sec. 643; Jefferson v. Burhans, 85 F. 949.)

S. C. Herren, for Respondents.

The defendants contend that the contract upon which this action is based is usurious and void. The evidence shows and the plaintiff practically admits these notes to be interest notes, but treats them as a commission. If interest notes, then they must be legal interest. The law knows no such term as commission interest. If Mr. Tallmon, the principal, could not charge compound interest, certainly his agent, Mr. Cornwell, could have no greater or more extensive privileges under the law. The two contracts referred to by plaintiff in his brief are but the ordinary forms used by brokers. (Banks v. Flint, 54 Ark. 40, 14 S.W. 769, 16 S.W. 477.) Under sections 1264, 1265 and 1266 of the Revised Statutes of the state of Idaho we find the rule laid down governing and defining usury in this state, and in addition to the statute, this court has construed the rule to be that "usury cannot be charged either directly or indirectly." (Vermont Loan etc. Co. v. Hoffman, 5 Idaho 376, 49 P. 314; Warren v. Johnson, 38 Kan. 768, 17 P. 592; Matthews v. Toogood, 23 Neb. 536, 37 N.W. 265; Thompson v. Ingram, 51 Ark. 546, 11 S.W. 881; Horkan v. Nesbitt, 58 Minn. 487, 60 N.W. 132; Fowler v. Equitable Trust Co., 144 U.S. 384, 12 S.Ct. 1.)

HUSTON, J. Sullivan, C. J., and Quarles, J., concur.

OPINION

HUSTON, J.

This is an action brought by plaintiff to foreclose a mortgage on real estate executed by defendants Alfred D. McCoy and Emma H. McCoy, his wife, to plaintiff, Henry Derham, William Kaufman, and E. Kaufman, partners as Derham & Kaufman, are made defendants as subsequent encumbrancers. Alfred D. McCoy and Emma H. McCoy, his wife, made default after personal service. Derham and Kaufman answer, and aver that the plaintiff, acting as the agent of one James H. Tallmon, on the twenty-seventh day of November, 1891, negotiated a loan to said defendants Alfred D. McCoy and Emma H McCoy, his wife, of the sum of $ 600, payable on the first day of December, 1896, at the Mechanics' Saving Bank at Hartford, Connecticut, evidenced by a promissory note to that effect, signed by said Alfred D. McCoy and Emma H. McCoy, to which principal note were attached five coupon notes of even date therewith, said coupon notes bearing the rate of interest of eight per cent per annum after due, and payable to James H. Tallmon; and the said Alfred D. McCoy and Emma H. McCoy, his wife, did at the same time, to wit, on the twenty-seventh day of November, 1891, execute to said James H. Tallmon, as security for the payment of said sum of $ 600 and the interest thereon as aforesaid, a mortgage upon the real estate described in the complaint: The answer further alleges that the plaintiff, while acting as the agent of said James H. Tallmon, and without any consideration being paid therefor, did exact and require of the said Alfred D. McCoy ...

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3 cases
  • Cornwell v. Urton
    • United States
    • Idaho Supreme Court
    • December 1, 1898
    ...and mortgage sued on were in violation of the usury laws of Idaho. (See Cornwell v. McCoy, ante, p. 219, 55 P. 240, and Cornwell v. Carter, ante, p. 222, 55 P. 240, decided at this (Syllabus by the court.) APPEAL from District Court, Nez Perces County. Reversed and remanded, with instructio......
  • Applington v. G. V. B. Mining Company
    • United States
    • Idaho Supreme Court
    • November 19, 1898
  • Cornwell v. Carter
    • United States
    • Idaho Supreme Court
    • November 19, 1898
    ...P. 1100 6 Idaho 222 CORNWELL v. CARTER Supreme Court of IdahoNovember 19, 1898 See syllabus in case of Cornwell v. McCoy, ante, p. 219; opinion governs this case. APPEAL from District Court, Nez Perces County. Judgment reversed, with costs to appellant. Cause remanded, with instructions. J.......

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