Eliza Brown, Appellant v. Frances Swann, Administratrix of William Swann, and Richard Alexander

• Decision Date: 01 January 1836
• Citation: 9 L.Ed. 508,35 U.S. 497,10 Pet. 497
• Parties: ELIZA BROWN, APPELLANT v. FRANCES SWANN, ADMINISTRATRIX OF WILLIAM T. SWANN, AND RICHARD B. ALEXANDER
• Court: U.S. Supreme Court

35 U.S. 497

10 Pet. 497

9 L.Ed. 508

ELIZA BROWN, APPELLANT v. FRANCES SWANN, ADMINISTRATRIX OF WILLIAM T. SWANN, AND RICHARD B. ALEXANDER.

January Term, 1836

ON appeal from the circuit court of the United States for the District of Columbia in the county of Washington.

This case was argued by Mr Key, and Mr Jones, for the appellant; and by Mr E. J. Lee, and Mr Swann, for the appellees.

Mr Justice WAYNE delivered the opinion of the Court.

This is an appeal from the circuit court of the United States for the District of Columbia and county of Alexandria.

The bill of the appellees, who were the complainants in the circuit court, is for an injunction to stay further proceedings on a judgment at law, confessed by the appellees to the appellant.

The bill states that the intestate, William T. Swann, in his life time, in October 1819, proposed to borrow from the appellant 2300 dollars, and pay her for the use of the money at the rate of ten per centum per annum. That the appellant agreed to the proposition. 1000 dollars were secured by a ground rent of 152 dollars per annum, on a lot in Alexandria; and the balance of the loan by a bond, bearing an interest of six per cent per annum, with William B. Alexander and Richard B. Alexander as securities. The intestate died in October 1820; and in June 1821, his administratrix paid the appellant 230 dollars; in August following, she paid the further sum of 1055 dollars and 30 cents, to which she adds 115 dollars, believed by her to have been paid by the intestate before his death. After these payments, the appellant brought separate suits upon the bond for 1300 dollars, against the administratrix, and the securities to the bond. The bill then states, that the appellees 'felt themselves at a loss to know what course to pursue in defence of the said suit. That they had been advised that the transaction between the defendant and your oratrix's late husband, was usurious; and they understood from their counsel, that if the case was defended at law, upon that ground, and they should succeed, that the debt would be lost to the defendant. That your oratrix and orator were not disposed to push the matter to this extremity; your oratrix knew that her late husband had received the money, and she wished, at all events, that the amount borrowed should be returned to the defendant; and your oratrix's counsel, understanding her wishes, agreed, as he informed her, at the bar, at the time the judgment was rendered upon the bond, with the counsel of the defendant, and in the presence and hearing of the court, that your oratrix's plea of usury should be withdrawn, and a judgment rendered on the bond; with an understanding, that your orator and oratrix should have the privilege of resorting to a court of equity, to have the claim settled upon the same principles, as if she had instituted against the defendant a bill in chancery for the discovery of the usury. Your oratrix and orator have been advised that they are bound, in a court of equity, to pay nothing more than the principal debt, and that they are entitled to have credit for the moneys which she has paid, to be deducted out of the sum of 2300 dollars, loaned as aforesaid; and only bound to pay the balance of principal, after such deduction shall have been made.' The bill further states, that if a settlement could be made upon these principles, that the oratrix would hold herself bound to pay 'the balance which might be due, as soon as the affairs of the estate would admit it.' That the defendant has issued an execution against your oratrix, and a separate execution against Richard B. Alexander and William B. Alexander, for the whole amount of the bond upon which the judgment at law was rendered; claiming not only the full amount of the debt, but the interest upon the same; and is about to enforce the execution against herself and the securities. The bill concludes with a prayer, 'that the defendant may, upon her corporal oath, true and perfact answers make to the several allegations of the bill and the matters therein charged, as if the same were again repeated, and she were interrogated thereto; that the complainants might have an injunction from the court, restraining the defendant from proceeding further upon the judgment, and from executing the same in any manner; and that the defendant may render a true and perfect account of all moneys received by her, on account of the aforesaid debt.' Upon filing the bill, the court granted an injunction. At a subsequent court, the injunction, on motion of the defendant, was in part dissolved; and the defendant filed a demurrer and answer to the bill. In the answer the usury is denied. The complainants filed exceptions to the answer. The injunction was then dissolved, and liberty was given to the defendant to prosecute her judgment at law. At the same time, on complainants' motion, leave was given to amend their bill, and to prosecute the suit thereon; and the cause was returned to the rules for further proceedings. The defendant's demurrer to the complainants' bill, and the complainants' exceptions to the answer, were then set down for argument. The cause was argued upon the demurrer and exceptions: and in the June term of the court, in 1828, the judges were of opinion, that the court had jurisdiction 'of the cause in equity, by virtue of the third section of the statute of usury of Virginia; although the plaintiffs have not stated in the said bill, that they cannot prove the usury without the aid of the defendant's answer; and although judgment had been rendered at law: and the court ordered the demurrers to be overruled, so far as they proceed upon these grounds.' The plaintiffs had leave to amend their bill, and the injunction was reinstated as to the whole amount of the judgment in the bill mentioned, except the sum of 899 dollars and 70 cents. The supplemental bill was filed, and the defendant put in a demurrer and answer thereto.

We do not think it necessary to refer particularly to the supplemental bill, or to the demurrers and answers of the defendant to either the original or amended bills, or to the intermediate proceedings in the cause. The court made its final decree in December 1832; and in it, and the orders overruling the demands, has put the case upon two points; which, contrary to the opinion of the court, we think so decidedly in favour of the appellant, that we need not go further. In both, the circuit court was of opinion that the court had jurisdiction of the cause, by virtue of the third section of the statute of Virginia, against usury; and in the first order overruling the demurrers, it added, 'although the plaintiffs have not stated in their bill that they cannot prove the usury without the aid of the defendant's answers, and although judgment has been rendered at law.'

The third section of the statute is in these words: 'any borrower of money or goods may exhibit a bill in chancery against the lenders, and compel them to discover on oath the money they really lent, and all bargains, contracts or shifts which shall have passed between them relative to such loan or the repayment thereof, and the interest and consideration for the same; and if thereupon it shall appear that more than lawful interest was reserved, the lender shall be obliged to accept his principal money without interest or consideration, and pay costs; but shall be discharged of all the other penalties of this act.'

The first question then to be considered is, can the bill of the complainants be brought within the operation of the section. We think not. Besides only making the contingent and prospective offer to pay the principal, when the affairs of the intestate 'would admit of it;' which is altogether insufficient, as any other indefinite offer or acknowledgement of obligation to pay the principal would be: the bill is deficient in the material averment, essential to all such bills of discovery as this is, that the complainants are unable to prove the facts sought from the conscience of the defendant by other testimony; but on the contrary, facts are stated in it from which a different presumption may be fairly raised.

When the legislature of Virginia passed the statute, it fixed the nature and extent of the jurisdiction of a court of equity to compel a discovery, upon oath, from an interested party, in a suit either at law or in equity, and the rules which equity had prescribed to itself to enforce its jurisdiction in this regard. It knew the distinction between a bill for such discovery, and other bills in chancery; which are also bills for discovery. One of the former is a bill for the discovery of facts alleged to exist only in the knowledge of a person, a party to a private transaction with the person seeking the disclosure; essential to the establishment of a just right in the latter, and which would be defeated without such disclosure. In other words, it is a bill to discover facts, which cannot be proved, according to the existing forms of procedure at law. The jurisdiction of a court of equity, in this regard, rests upon the inability of the courts of common law to obtain, or to compel such testimony to be given. It has no other...