Goggans v. Turnipseed

• Decision Date: 27 April 1869
• Citation: 1 S.C. 80
• Parties: DANIEL GOGGANS, ADMINISTRATOR, v. J. O. TURNIPSEED AND ANOTHER, EX'ORS.
• Court: South Carolina Supreme Court

1 S.C. 80

DANIEL GOGGANS, ADMINISTRATOR, v. J. O. TURNIPSEED AND ANOTHER, EX'ORS.

Supreme Court of South Carolina.

April 27, 1869

So much of the Act passed December 21, 1861, and other later Acts known as the Stay Law, as provided that " debts due on open accounts and other demands not heretofore bearing interest by law, shall bear interest," & c., is unconstitutional and void, so far as it related to debts contracted before the passage of the first Act.

Moses C. J., holding that an Act allowing interest upon existing contracts not bearing interest, is interdicted by Section 10 of Article I of the Constitution of the United States, declaring that " no State shall pass any law impairing the obligation of contracts."

Willard A. J., holding the provision in relation to interest not to be an independent enactment, but to be merely a feature of the general plan of the Act to grant a suspension of legal remedies-to be inseparable from that general plan-and, therefore, to be affected by, and void under, the decision in State vs. Carew , 13 Rich. 498.

BEFORE DAWKINS, J., AT NEWBERRY, SPRING TERM, 1867.

Sum. pro. on a merchant's open book account for goods sold in the year 1861, previous to the 21st December. His Honor gave a decree for the plaintiff for $33.67, the amount of the account, and for interest thereon.

The defendants appealed, on the ground that the Act of December 21, 1861, under which the interest was allowed, was unconstitutional and void, so far as it affected contracts then existing.

Fair , for appellants.

Baxter , contra.

OPINION

MOSES C. J.

This is a process on (what in the report is called) " a merchant's account for the year 1861." We understand, by the admission of the counsel, that it was an open running account with a storekeeper for goods supplied during the year 1861.

In this State it has always been held that interest was not recoverable on an open or book account.- Skirving vs. Ex'rs of Stob?? , 2 Bay. 233; Adm'rs of Conyers vs. Magrath , 4 McC. 392; Johnson ads. Bennett , 1 Speers 209. And Judge Nott, delivering the opinion of the Court in Goddard vs. Bulow , 1 N. & McC., 57, remarks: " I should be willing to carry the doctrine further, and allow interest in all cases on open accounts where payment is to be made at a certain time. But I think the contrary has been so well established by the uniform current of decisions in this State that it would now be a dangerous and unauthorized innovation."

So far have our Courts gone on this question that, in Bishop vs. Ross , Rice, 21, it was held that interest could not be recovered on a letter of guaranty given for an open account, although the sum be fixed in writing.

The General Assembly, in the exercise of its legislative powers, may prescribe interest on demands of any character, if, in doing so, it does not violate any of the provisions of the Federal or State Constitution.

It is objected that the Act under which interest was here decreed does violate the 10th Section of 1st Article of the Constitution of the United States, which forbids the passage by the State " of any law impairing the obligation of contracts."

On the 21st of December, 1861, the General Assembly passed an Act, entitled " An Act to extend relief to debtors, and to prevent the sacrifice of property at public sales." -13 Stat. 18.

The first Section makes unlawful the service of mesne or final process of any of the Courts of this State for the collection of money until after the expiration of the first session of the next General Assembly of the State, except in the cases therein specifically provided. It was renewed in February and December, 1864, and continued in force, in December, 1865, until the adjournment of the next regular session.

The 6th Section is in the words following: " That, while this Act remains in force, debts due on open accounts, and other demands not heretofore bearing interest by law, shall bear interest at the rate of 7 per cent."

It is under this that the claim to interest is made. The cause of action, therefore, arose before the passage of the Act, and the only question is, whether the right to interest, which the Section provides, can attach to it?

It is an admitted principle, that one clause or part of an Act may be without any constitutional prohibition, and yet another not subject to such exception.- Ogden vs. Saunders , 12 Wheat. 213; Barry vs. Iseman , 14 Rich. 129. Under this very statute, the Court of Appeals held, in the State vs. Carew , 13 Rich. 498, the first Section unconstitutional as to antecedent contracts, and, in Barry vs. Iseman , valid as to contracts entered into after its passage; and, in Wardlaw and Simkins, administrator and administratrix of Simkins vs. Buzzard , 15 Rich. 158, that the 5th Section, which suspended the operation of the statute of limitations " during the period in which the Act was of force," " so far as applicable to causes of action coming within the meaning of the Act, was not in violation of the Constitution of the United States."

The obligation which the Constitution refers to is the legal, and not the moral attribute of the contract. " It is the law which binds the party to perform his undertaking." It subsists in the law applicable to the agreement. " Anything which enlarges, abridges, or, in any manner, changes the intention of the parties, resulting from the stipulations in the contract, necessarily impairs it." - Ogden vs. Saunders , 12 Wheat. 213. This principle is recognized in all the cases where this constitutional inhibition has been discussed; among which are: Sturges vs. Crowninshield , 4 Wheat....