Harrell v. Parrott

• Decision Date: 13 July 1897
• Parties: HARRELL v. PARROTT et al.
• Court: South Carolina Supreme Court

27 S.E. 521

50 S.C. 16

HARRELL v. PARROTT et al.

Supreme Court of South Carolina

July 13, 1897

Appeal from common pleas circuit court of Darlington county; James Aldrich, Judge.

Action by S.D. Harrell, administrator with the will annexed of I. M Harrell, deceased, against J. N. Parrott and others. From a decree for plaintiff, defendants appeal. Affirmed.

Following are the material portions of the decree of the lower court:

"This is an action for the foreclosure of a mortgage of real estate dated December 1, 1880, given and executed by J. N Parrott, defendant above named, to I. M. Harrell, testator to secure the payment of the promissory note of said Parrott to said testator, of date December 1, 1880, for the sum of $1,840, on December 1, 1881, with interest from date. The note and mortgage are admitted, and the complaint is in the usual form, demanding judgment for said debt and interest, less certain payments upon same as stated in said complaint. The other defendants own and hold alleged junior incumbrances upon the mortgaged premises, and for that reason are made parties defendant. The answer of the defendant Parrott, after admitting the execution and delivery of said note and mortgage as alleged in the complaint, set up several defenses, to wit: (1) He denies that the payments are correctly stated in the complaint and alleges that, over and above the several payments stated therein, $174 were paid on ___ day of January, 1884 and $132 were paid on ___ March, 1885. (2) He alleges that from time to time, and at the date of payments, testator charged and received usurious interest, to wit, 9 per centum. (3) That the agreement of October 20, 1885, indorsed upon the back of the aforesaid promissory note, wherein defendant Parrott, in writing, agreed to pay interest on said note after 1883 at the rate of 10 per centum per annum, was made long after the original contract, and was made for a greater amount of interest than that allowed by the statutes, and was usurious. (4) That a homestead was set off to defendant out of the mortgaged premises after he had made said mortgage. (5) Sets up a counterclaim for double the amount of illegal interest paid. This counterclaim, as announced in open court, was abandoned by defendant, and therefore needs no consideration. (6) Demands an accounting. The other defendants either answered, setting up their junior liens, or defaulted. All of them were duly served. The case came on and was heard by the court upon the pleadings, and the testimony taken in open court. This case has been before the supreme court, and was by that court remanded for a new trial. 23 S.E. 946.

"On December 1, 1880, when the contract herein, evidenced by the note and mortgage, was made, the act of 1877 (16 St. at Large, 325) was in force. Under that act no greater rate of interest than seven per centum per annum could be charged, and the penalty for lending or advancing money or other commodity for a greater rate is a forfeiture of all interest, and a limitation to the recovery of the principal sum, without costs. The note and mortgage in this case are not in violation of the provisions of this statute, but, on the contrary, are in exact compliance therewith. On the back of said note the following payments were indorsed by testator, to wit, on November 5, 1881, the sum of $191.29, and on December 1, 1882, the sum of $115.70. The defendant Parrott says that these payments were made in satisfaction of the interest due upon said debt; that said interest was calculated at the rate of nine, and not seven, per centum per annum; that he paid this illegal interest; and that, therefore, under the provisions of the act cited supra, plaintiff can only recover the principal of the debt, less payment, and without any interest or costs. The law is plain, and the burden of proof is upon the defendant to sustain his allegations. Let us examine the testimony and ascertain the facts. The credits upon the note above referred to are in writing, and that writing is plain, with no trace of ambiguity about it. These indorsements say, each and both, in express language, that the said sums were received as payments 'on the within note.' The natural and legal applications of these payments would be (1) in satisfaction of the interest thus due; and (2) if in excess of interest then due, towards the satisfaction of the principal debt. There is not a word in either of these indorsements that would or could suggest that these payments were made for interest due and nothing else, or that can be construed as solely relating to interest. The record is therefore against the defendant Parrott. But, in cases of usury, courts will go behind records, hear the testimony, and, if usury be found, express and condemn it. Defendant testified as a witness in his own behalf, and was allowed to testify as to all matters save and except such conversations, transactions, etc., as were had between himself and testator. Objections to his testifying as to these matters, etc., based upon section 400 of the Code, were made by counsel and sustained by the court.

"Except the paper called 'Exhibit C,' next to be discussed there is no evidence, worthy of consideration, to be considered. Plaintiff, subject to exceptions, admitted that Dr. Luther Harrell, if present, would testify that Exhibit C was made by him. It seems that Dr. Harrell is a son of the testator, and that he was a college boy at home on vacation when he made the calculation contained in C. Testator in 1885, while quite aged and physically feeble, was otherwise very well preserved. Defendant Parrott testified that on the day he signed the agreement on the back of the note, promising to pay interest at the rate of ten per cent. thereon, that testator and his son Luther, then a youth, came to his residence, and that Luther Harrell handed him the paper, Exhibit C. Here the matter ends. The agreement signed by Parrott and indorsed on the note does not refer to Exhibit C, or any other calculation. They have no connection, and do...