Edwards v. Rumph

• Decision Date: 12 March 1887
• Parties: EDWARDS <I>v.</I> RUMPH.
• Court: Arkansas Supreme Court

3 S.W. 635

EDWARDS

v. RUMPH.

Supreme Court of Arkansas.

March 12, 1887.

Appeal from circuit court, Nevada county. In chancery.

Smoote, McRae & Huiton, for appellants. B. W. Johnson, for appellee.

BATTLE, J.

G. B. Rumph was a merchant doing business in the city of Camden, in this state, during the years 1879, 1880, 1881, 1882, and 1883. Joe Edwards was a farmer, and during these years bought goods, wares, and merchandise, and borrowed money, of Rumph on a credit. On the moneys loaned, Rumph charged, and Edwards agreed to pay, 15 per cent. interest. They settled annually, Edwards giving new notes to cover balances due and future advances, and deeds of trust to secure the same. On the second of March, 1882, on a settlement, Edwards was found to owe Rumph $822.25. Fifteen per cent. interest was charged and added to this balance, pursuant to an agreement between Rumph and Edwards for indulgence and extension of time for payment. On the fourth of April, 1882, Edwards executed his note to Rumph for the sum of $1,100 to cover this balance and interest, and in settlement and payment thereof and of future advances, payable on the first day of November following, and bearing 10 per cent. per annum interest from the maturity thereof until paid, and executed a deed of trust to secure the same and other indebtedness of Edwards to Rumph, which should be existing at the time of the maturity of the deed of trust. In this deed certain lands were conveyed in trust as security. Edwards sold a part of this land to William Bolden for the sum of $400, and Bolden gave two notes for the purchase money. Edwards deposited these notes with Rumph as collateral security for the payment of his indebtedness to Rumph. In the mean time Edwards continued to trade with and borrow money of Rumph. On the first of March, 1883, Edwards' debts to Rumph, including the balance of $822.25, and the 15 per cent. added thereto, were $1,681.80, and his credits amounted to $1,271.32, leaving a balance of $410.48 due Rumph. Bolden failing to pay the first of his notes falling due, Rumph brought this action against Edwards and Bolden in the Nevada circuit court, on the equity side thereof, to recover of Edwards the $410.48, and asked in his complaint to be subrogated to all the rights and privileges of Edwards as vendor of the land sold to Bolden, and that the land so sold be sold under a decree of the court, and that the proceeds of the sale be applied to the payment of the amount due on the note of Bolden then due, and that the amount so applied to the payment of Bolden's note be paid to Rumph in part payment of the balance due him by Edwards, and that the residue of the proceeds, if there should be any, be held subject to the order of the court for the payment of the other note of Bolden when it should fall due, and for general relief; and Edwards pleaded usury by way of defense. On the hearing, evidence was introduced which established the foregoing facts. The court found that the debt secured by the deed of trust executed on the fourth of April, 1882, was usurious and void; that the open account of Rumph against Edwards for the year 1882 was not usurious, but had been paid in full; that plaintiff was not entitled to foreclose the deed of trust; that plaintiff was an innocent purchaser of the notes of Bolden before...