Monroe v. Foster

• Decision Date: 01 March 1873
• Parties: LORENZO D. MONROE, plaintiff in err0r. v. JAMES A. FOSTER, defendant in error.
• Court: Georgia Supreme Court

49 Ga. 514

LORENZO D. MONROE, plaintiff in err0r. v. JAMES A. FOSTER, defendant in error.

Supreme Court of the State of Georgia

(Atlanta, July, Term, 1873.)

Mortgage. Deed. Usury. Before Judge Harrell. Randolph Superior Court. November Term, 1873.

Foster filed his bill against Monroe, making substantially the following case:

On December 31st, 1869, it was agreed between the complainant *and the defendant, that in consideration of the latter allowing a delay in the payment of $200 00, which he had previously loaned to the complainant, and to secure which complainant had executed a deed to him to a certain lot in the city of Cuthbert, and in consideration of the further advance of $800 00, the entire sum of $1,000 00, to become due on December 30th, 1870, complainant contracted that he would pay to defendant two and one-half per cent, per month as interest on the amount aforesaid for the year 1870. To secure the repayment of said sum of $1,000 00, with the usurious interest aforesaid, complainant conveyed by deed two other lots to said defendant, taking from the latter a bond to deliver up to complainant the deeds aforesaid upon the payment of the said sum of $1,000 co, and $25 00 per month as rent, for the year 1870, by the last day of said year, said bond to be void upon a failure to pay at the time specified. The two lots above mentioned are of the value of $3,000 co. The $25 00 termed rent is merely usurious interest. The whole transaction was simply a loan of $1,000 00 at two and one-half per cent. per month, but covered up under the forms aforesaid to evade the usury laws of this State. On January 1st, 1871, it was agreed between complainant and said defendant that the time of payment specified in said bond should be extended for another year upon the same terms. He has paid to said defendant $25 00 per month for the year 1870, and for eleven months of the year 1871, making in all $575 co for the use of said $1,000 00.

The bill sets out numerous loans on the part of the defendant to the complainant at usurious rates of interest, and by a calculation seeks to show that the defendant had received in all $555 33 above the legal interest which should be credited on said $1000 00.

Complainant tenders the balance due, after allowing the aforesaid credit, and prays that the deeds aforesaid may be decreed to be delivered up to be canceled, and that the de-fendant and the sheriff of Randolph county may be enjoined *from ejecting complainant from the possession of said city lots until a decree is rendered in this case.

The answer of the defendant denied that the deeds set forth in the bill were executed as security for money loaned, but asserts on the contrary, that the defendant expressly declined to lend any money to the defendant at the times said conveyances were made and delivered, and also declined to accept a mortgage on the property described in said deeds as security; that the deeds aforesaid, together with the bond executed by the defendant, express the precise contract that was entered into; denies that the two lots aforesaid were worth $3,000 00, as charged in the bill, and asserts them to be worth but $1,500 00; denies every allegation in the bill tending to show that the deeds and bond aforesaid were made to evade the usury laws, and that the monthly payments called rent were in fact usury.

The complainant, by his own evidence, and other witness, supported the allegations of his bill. He admitted that the defendant refused to lend him money or to take a mortgage as security, but asserted that the defendant, at the same time, stated that he could get the funds he wished if he would deed to him his lands, with the privilege of redeeming, in the meantime paying the rent therefor, as set forth in the bill.

The defendant testified substantially as set forth in his answer. He was corroborated by James M. Brooks as to the value of the two lots.

The following verdict was returned: "We, the jury, find a decree that the deeds from J. A. Foster to L. D. Monroe, dated 21st July, 1869, and December 30th, 1869, respectively, with the bond of L. D. Monroe to J. A. Foster, dated 30th December, 1869, be delivered up to be canceled, and that L. D. Monroe recover of J. A. Foster the sum of $625 65, to be recovered, if not voluntarily paid by the said Foster, out of the lots mentioned in said deeds."

The defendant moved for a new trial upon numerousgrounds, and amongst them, because the verdict was contrary *to the law and the evidence. The motion was overruled, and the defendant excepted.

A. Hood; E. G. Raiford; L. D. Monroe, for plaintiff in error.

1st. There is no allegation of fraud, accident or mistake in making the deeds; they were all written by the complainant, and hence understood by him: Miller et al. v. Cotton et al., 5 Ga., 341.

2d. When a borrower files his bill in equity to be relieved against a usurious contract, the Court refuses relief, except upon the terms of his paying up the principal sum due and legal interest, notwithstanding the law may have declared the contract void: 10 Ga., 389; 4 Ibid., 221; 9 Ibid., 148, (5;) 5 Johns. Chancery Reports, 137; 1 Fonb., (b) 1, chap. 1, sec. 3; 4 Band., 415.

3d. A complainant in equity, who relies for relief upon a tender, must allege all the facts substantially which are necessary in pleading a tender at law: 10 Ga., 127; 34 Ibid., 555.

4th. At law, a party must allege an offer to pay, unconditionally; that he is still ready to pay, and has always been ready to pay, and must do this in equity: 10 Ga., 127; 34 Ibid., 555; 24lbid., 211, 475; 1 Selwyn's Nisi Prius, (4th ed.) 140—and must be paid into Court when demanded.

5th. The true rule to determine whether the instrument of writing executed by Monroe and Foster make a mortgage or a conditional sale is, if the relation of debtor and creditor remain and a debt still subsists, it is a mortgage, but if the debt is extinguished by the agreement of the parties, or the money advanced was not a loan, and the grantee has the privilege of refunding, if he pleases, by a given time,...