Crapo v. Hefner
| Decision Date | 03 January 1898 |
| Parties | CRAPO v. HEFNER ET AL. |
| Court | Nebraska Supreme Court |
Where a note or bond provides for interest at a lawful rate from date until maturity, and for a higher lawful rate thereafter, the latter provision is not in the nature of a penalty, but is authorized by section 3, c. 44, Comp. St., and accordingly enforceable in an action on the contract. Havemeyer v. Paul, 63 N. W. 932, 45 Neb. 373.
Error to district court, Lancaster county; Hall, Judge.
Action by Philip M. Crapo against H. C. Hefner and another to recover upon a note. From the judgment, plaintiff brings error. Reversed.Samuel J. Tuttle, for plaintiff in error.
W. E. Stewart and E. H. Wooley, for defendants in error.
There is presented by the record of this case a single question, viz. the rate of interest recoverable upon the note in suit, which in terms provides for interest at 7 per cent. per annum, payable annually, with the further proviso that “this note is to draw 9 per cent. interest per annum after default in payment of principal or interest.” There was due at the commencement of the action, in addition to the principal note of $3,000, one interest coupon for $210, which also provided for interest at the rate of 9 per cent. after maturity. The district court allowed interest at 7 per cent. only, and denied the plaintiff's prayer for the higher rate contracted for after default, and which is the ruling now assigned as error. The precise question here involved was in Havemeyer v. Paul, 45 Neb. 373, 63 N. W. 932, determined adversely to the ruling of the district court. It was in the case cited held, overruling Richardson v. Campbell, 34 Neb. 181, 51 N. W. 753, that where a note provides for a lawful rate of interest from date until maturity, and a higher lawful rate thereafter, the latter provision is not in the nature of a penalty, but is authorized by section 3, c. 44, Comp. St., and accordingly enforceable in an action on the contract. It follows from the reasoning in that case that the judgment of the district court must be reversed, and the cause remanded. Reversed and remanded
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