Merchants Finance Co. v. Goldweber
| Decision Date | 16 July 1941 |
| Docket Number | 28556. |
| Citation | 35 N.E.2d 779,138 Ohio St. 474 |
| Parties | MERCHANTS FINANCE CO. v. GOLDWEBER et al. |
| Court | Ohio Supreme Court |
Syllabus by the Court.
1. The rate of interest upon a judgment is controlled not by the terms of the contract reduced to judgment but by the terms of the statutes. (Sections 8304 and 8305, General Code) relating to interest upon judgments.
2. Section 8304 and 8305, General Code, are not modified or amended, with respect to provisions determining the rate of interest upon judgments, by the subsequent enactment of the Small Loans Act, Section 6346-1 et seq., General Code.
3. Where a note bearing interest at two per cent. per month--a legal rate under the Small Loans Act, Section 6346-1 et seq General Code--is reduced to judgment, the cause of action upon the contract is merged in the judgment, which, by the terms of Section 8305, General Code, bears interest at six per cent. per annum.
Appeal from Court of Appeals, Cuyahoga County.
The plaintiff, the Merchants Finance Company, a partnership licensed under the Ohio Small Loans Act, Section 6346-1 et seq., General Code, brought suit in the Municipal Court of Cleveland, against the defendants, Sam and Yetta Goldweber to foreclose a chattel mortgage and obtain judgment upon a note in the face amount of $200, payable in installments and providing for the payment of interest at two per cent a month upon the unpaid balance of principal 'until fully paid.' The Municipal Court decreed foreclosure of the chattel mortgage and gave judgment for the plaintiff in the amount of $182.07, providing in its journal entry that the judgment was 'to bear interest at the rate of 6 per cent per annum from date of judgment.' The plaintiff's motion for a new trial, based upon the refusal of the court to allow interest upon the judgment at the rate of two per cent a month, was overruled, and upon appeal by the plaintiff to the Court of Appeals of Cuyahoga county, on questions of law, the judgment below was affirmed. The case is now before this court pursuant to the granting of a motion to certify.
Schermer & Goldstein, of Youngstown, and L. W. Myron, of Cleveland, for appellant.
Stanley L. Orr, of Cleveland, for appellees.
The single question here presented is: When a note bearing interest at the rate of two per cent a month 'until fully paid'--a rate permissible under the Ohio Small Loans Act (Section 6346-1 et seq., General Code)--is reduced to judgment, what interest does that judgment bear?
It has long been established by the decisions of this court that, inasmuch as judgments bore no interest at common law, interest upon judgments is controlled and determined, not by force of any provisions of the contract sued upon, but solely by what the statutes may provide with respect to judgments and interest thereon. Neil v. First Nat. Bank, 50 Ohio St. 193, 33 N.E. 720; Guernsey Branch of State Bank of Ohio v. Kelley, 14 Ohio St. 367. Thus only in those cases where the statute provides that the interest called for by the contract shall be determinative of the rate of interest upon the judgment, do the terms of the contract have any relation to the rate of interest upon judgments, and then not by force of the contract, but by force of the statute. Marietta Iron Works v. Lottimer, 25 Ohio St. 621. Decisions in other states are to the same effect. Wilson v. Marsh, 13 N.J.Eq. 289; Wernwag v. Brown, 3 Blackf., Ind., 457, 26 Am.Dec. 433; O'Brien v. Young, 95 N.Y. 428, 47 Am.Rep. 64. It is the ratio of the foregoing cases that, at least for the purposes of determination of interest, the cause of action upon a contract for the payment of money becomes merged in the judgment sought and recovered by the plaintiff; and that the plaintiff, voluntarily seeking in a court of law the remedy of a judgment, may receive, and the court may grant, only such interest on that judgment as is created by statute as an incident to judgments of that type. Therefore, to determine the amount of interest that the plaintiff's judgment in this case may bear, we must examine the Ohio statutes.
Three venerable sections of the General Code of Ohio bear upon this problem.
Section 8303 provides: 'The parties to a bond, bill, promissory note, or other instrument of writing for the forbearance or payment of money at any future time, may stipulate therein for the payment of interest upon the amount thereof at any rate not exceeding eight per cent per annum, payable annually.'
Section 8304 provides: 'Upon all judgments, decrees, or orders, rendered on any bond, bill note, or other instrument of writing containing stipulations for the payment of interest in accordance with the provisions of the next preceding section, interest shall be computed till payment at the rate specified in such instrument.'
Section 8305 provides: 'In cases other than those provided for in the next two preceding se...
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State v. Penrod
...627. Thus, if any interest is to be payable on a judgment, it must be provided for by statute. See Merchant's Finance Co. v. Goldweber (1941), 138 Ohio St. 474, 475, 35 N.E.2d 779, 780. Appellant relies herein on the statutory interest provisions of R.C. 1343.03(A), which provide, in pertin......
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Gawry v. Countrywide Home Loans Inc
... ... App. Jan. 16, 1997) (unpublished) (citing Merchs. Fin. Co. v. Goldweber, 35 N.E.2d 779 (Ohio 1941); In re Hoff, 187 B.R. 190, 195 (S.D. Ohio 1995). Similarly, "[i]n the ... ...
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State v. Leonard Penrod, 92-LW-3060
... ... judgment, it must be provided for by statute. See ... Merchant's Finance Co. v. Goldweber (1941), 138 Ohio ... St. 474, 475. Appellant relies herein on the statutory ... ...
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First Bank of Marietta v. Van Olnhausen
...Rogers, supra. We noted above that by taking judgment on their promissory note, the appellants merged the note into the judgment. Merchants Finance, supra. Therefore, they may now bring a second action based on this promissory note. They may only collect on their earlier judgment, by forecl......