Preyer v. Parker
| Decision Date | 15 June 1962 |
| Docket Number | No. 601,601 |
| Parties | Fred L. PREYER and G. Allen Mebane v. J. D. PARKER and wife, Helen H. Parker. |
| Court | North Carolina Supreme Court |
Smith, Moore, Smith, Schell & Hunter and Richmond G. Bernhardt, Jr., Greensboro, for plaintiff appellants.
Bailey & Bailey, Plymouth, for defendant appellees.
The sole question presented by this appeal is whether the plaintiffs' evidence establishes as a matter of law that the contract upon which they sued was a usurious transaction.
'In order to constitute a usurious transaction, four requisites must appear: (1) There must be a loan express or implied; (2) an understanding between the parties that the money lent shall be returned; (3) that for such loan a greater rate of interest than is allowed by law shall be paid or agreed to be paid as the case may be; and (4) there must exist a corrupt intent to take more than the legal rate for the use of the money loaned * * * unless these four things concur in every transaction it is safe to say that no case of usury can be declared. * * *
'Where the facts are admitted and the unlawful intents plainly manifest from them, the court may declare a transaction usurious as a matter of law.' Doster v. English, 152 N.C. 339, 67 S.E. 754.
Applying these well settled principles, as was said in Doster, it is plain that the Court could not declare the transaction between plaintiffs and defendants in the instant case usurious as a matter of law. On the motion for nonsuit plaintiffs are entitled to have the evidence considered in the light most favorable to them. Rouse v. Jones, 254 N.C. 575, 119 S.E.2d 628.
The contract and note which form the basis of plaintiffs' action were obviously not the work of a skilled, legal craftsman. Without doubt, the source of this controversy is paragraph (a) of the settlement provisions of the contract which became pertinent only in the event defendants themselves should sell the property. This paragraph reads as follows: 'For the use of $35,000.00 received from you I will repay $35,000.00 plus $17,500.00 at time of sale of this timber.' Standing alone this paragraph would have justified the nonsuit on the ground of usury. However, when the contract is read as a whole it is unambiguous, and the intent of the parties at the moment of its execution emerges clearly.
The parties themselves would make this case turn upon whether or not the transaction between the plaintiffs and defendants constituted a loan or a joint adventure. The briefs are evidence that much research has been done on the law of joint adventure. We do not think the agreement between the parties constituted a joint adventure nor do we think the only alternative to a joint adventure is a usurious loan requiring a nonsuit of plaintiffs' cause of action. As we construe the agreement it was a twelvemonths option which, for a consideration, reserved to the optionors the right to cancel it and to sell the property themselves at any time before it was exercised by the optionees.
Between January 3, 1956 and July 24, 1956, plaintiffs had attempted to sell the defendants' land under an oral agreement. On July 24, 1956 plaintiffs lent defendants $35,000.00 for ninety days without interest. On that date defendants executed a note and an option under seal whereby they granted to the plaintiffs or their assigns the right at any time during one year from January 3, 1956 to buy the timber on defendants' 23,000 acre tract of land in Hyde County for $1,450,000.00 or to buy the land and timber for $1,650,000.00. The contract specified in detail the method and time for payments, and it limited the time in which the timber might be cut if timber alone were purchased. In the agreement, however, the defendants retained the right to sell the property themselves but, if they did so, they were to repay the plaintiffs the $35,000.00 plus $17,500.00...
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