South Georgia Mercantile Co. v. Lance
| Decision Date | 18 June 1915 |
| Docket Number | 374. |
| Citation | 85 S.E. 749,143 Ga. 530 |
| Parties | SOUTH GEORGIA MERCANTILE CO. v. LANCE. LANCE v. SOUTH GEORGIA MERCANTILE CO. |
| Court | Georgia Supreme Court |
Syllabus by the Court.
The act of 1912 (Acts 1912, p. 144), regulating the rate of interest allowed on loans to be repaid in monthly installments, is not violative of article 1, § 4, par. 1, of the Constitution of Georgia (Civ. Code 1910, § 6391), on the ground that it is a special law for which provision has been made by an existing general law.
Nor is the above act violative of article 3, § 7, par. 8, of the Constitution of Georgia (Civ. Code 1910, § 6437), on the ground that the act contains matter different from that expressed in the title, and that the title is too indefinite to indicate the matters contained in the body of the act.
Nor is the act of 1912 violative of article 4, § 2, par. 1, of the Constitution of the United States, on the ground that it denies to citizens of other states the right to lend money in this state to be paid back in monthly installments, where interest is charged at the rate of 6 per cent. per annum, or less, for the entire period of the loan, and the principal and interest for the entire period of the loan is aggregated and divided into monthly installments.
Under the terms of the contract which is set out in the questions of the Court of Appeals, on failure of the debtor to pay three installments after they became due, the lender was not confined to the right to sue for such past installments, but was authorized to bring suit for the amount of the loan, with interest thereon.
(a) It elected to pursue this remedy, and thereby abandoned any other possible remedy which it might have had in regard to bringing suit.
(b) When the lender elected to pursue this remedy under the contract, it could not establish a basis involving the collection of interest at the rate of 12 per cent., which was unlawful, but it could only sue for the amount, with legal interest thereon from the date of the loan, crediting any payment made under the ordinary rule of partial payments.
Additional Syllabus by Editorial Staff.
The phrase "installment plan," as used in the title of Acts 1912, p. 144, reading, "An act to authorize any person lending money to be repaid on the installment plan to aggregate the principal and interest, * * *" embraces the words "monthly installments" as used in the body of such act; and hence the title is sufficiently comprehensive to cover that portion of the act which authorizes the lender to aggregate the principal and interest for the entire period of the loan and to divide the loan into monthly installments (citing Words and Phrases, Second Series, Installments).
Certified Questions from Court of Appeals.
Action between the South Georgia Mercantile Company and J. B. Lance. From the judgment, both parties brought error to the Court of Appeals, which certifies certain questions to the Supreme Court. Questions answered in opinion.
The phrase "installment plan," as used in the title of Acts 1912, p. 144, reading, "An act to authorize any person lending money to be repaid on the installment plan to aggregate the principal and interest, * * * " embraces the words "monthly installments" as used in the body of such act.
The Court of Appeals certified to this court the following questions:
Sec. 3427. Usury is the reserving and taking, or contracting to reserve and take, either directly or by indirection, a greater sum for the use of money than the lawful interest.'
(b) Is the said act violative of article 3, § 7, par. 8, of the Constitution of Georgia (Civil Code, § 6437), on the ground that the act contains matter different from that expressed in the title, and the title is too indefinite to indicate the matters contained in the body of the act, in that the act authorizes any persons, natural or artificial, in this state, lending money to be paid back in monthly installments, to charge interest thereon at 6 per cent. per annum, or less, for the entire period of the loan, and divide the same into monthly installments, whereas the title of the act does not indicate that the said persons are to be allowed to aggregate the principal and interest for the entire period of the loan and divide the same into monthly installments?
(c) Does the language of section 1 of the said act, which declares that 'any persons, natural or artificial in this state, lending money,' etc., mean that the rights and privileges granted by this act are confined to persons, 'natural or artificial in this state,' or that the rights and privileges thereby granted may be enjoyed by any persons, natural or artificial, who may lend money in this state, whether or not resident or domiciled in this state? If these rights and privileges are confined to persons resident or domiciled in this state, is the said act violative of article 4, § 2, par. 1, of the Constitution of the United States, on the ground that it denies to citizens of other states the right to lend money in this state to be paid back in monthly installments, where interest is charged at the rate of 6 per cent. per annum, or less, for the entire period of the loan, and the principal and interest for the entire period of said loan is aggregated and divided into monthly installments?
2. In the event the Supreme Court shall answer, in response to the preceding question, that the act therein referred to is not unconstitutional and void for any of the reasons suggested, is the following contract nonusurious, legal, and enforceable, or is it usurious to the extent that it stipulates for interest in excess of 8 per cent. per annum.'
'State of Georgia, County of Chatham. Know all men by these presents that John B. Lance, of the county and state aforesaid acknowledged himself held and firmly bound unto the South Georgia Mercantile Company, a corporation of Savannah, Georgia, its successors and assigns, in the just and full sum of two thousand ($2,000.00) dollars, for which payment, well and truly to be made, he binds himself, his heirs, executors, and administrators, firmly by these presents. The condition of the above obligation is such that whereas the said obligor has obtained a loan of one thousand ($1,000.00) dollars from the said company, now know ye that if the above-named obligor or any one for him shall well and truly pay or cause to be paid to said company, at its place of business in Savannah, Georgia, on or before the last business day in each and every month, until sixty (60) monthly payments have fallen due and been paid, the sum of twenty-one and 66/100 ($21.66), dollars (which is made up of the sum of sixteen and 66/100 ($16.66) dollars as installments of principal and five ($5.00) dollars as installments of interest upon said loan, then this obligation to be void, else to remain in full force and virtue. It is further stipulated and agreed that the said loan may be repaid at any annual period from date hereof, written notice of an intention so to repay being given to the home office ninety days before such annual period; and upon any such settlement before maturity the basis of the settlement shall be computed as follows: The principal debt with interest thereon at the rate of twelve per cent. per annum, and allowing credit for all payments of installments or principal and interest upon loan, with interest thereon at the rate of twelve per cent. per annum from date of payment to said company, computed in accordance with the laws of the state of Georgia. And it is further stipulated and agreed that in the event the installments of principal and interest upon the loan are not paid promptly at the time stipulated in this obligation, in the final settlement at maturity the basis shall be the principal debt with interest thereon at the rate of twelve per cent. per annum from date of payment of same to said company, computed in accordance with the laws of the state of Georgia. It is further stipulated and agreed that the nonpayment of three installments of principal or interest after...
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