Taylor v. Hiestand
| Decision Date | 26 February 1889 |
| Citation | 20 N.E. 345,46 Ohio St. 345 |
| Parties | TAYLOR et al. v. HIESTAND et al. |
| Court | Ohio Supreme Court |
Error to circuit court, Preble county.
On May 9, 1885, defendants in error began an action against plaintiffs in error, in the court of common pleas of Preble county, on a promissory note secured by mortgage, a copy of which note, with the indorsements thereon, was set forth in the petition as follows:
‘ $2,600.00.
EATON O., March 13th, 1880.
‘ Three years after date we or either of us promise to pay to the order of H. C. Hiestand & Co. the sum of twenty-six hundred dollars, for value received, with 8 per cent interest from date, the interest to be paid semi-annually and in case said interest shall not be paid as the same falls due, then the interest to bear 8 per cent.; and in case any installment of interest shall remain unpaid for the period of twenty days after the same becomes due, then the whole note is to become due and payable.
‘ Interest paid on this note to September 13th, 1880.
‘ Interest paid on this note to March 13th, 1881.
‘ Interest paid on this note to September 13th, 1881.
‘ Interest on this note paid to March 13th, 1882.
‘ Interest on this note paid to September 13th, 1882, $104.00.
‘ Interest paid on this note to March 13th, 1883.
‘ Interest paid on this note to September 13th, 1883, $104.00.
‘ Interest paid on this note to March 13th, 1884, $104.00.
‘ Paid on the within note twenty-six hundred dollars ($2,600.00,) March 5, 1885.’
To this petition the plaintiffs in error demurred, on the ground that the promissory note was usurious on its face, and for that reason fully paid by the payments set forth in the petition. The demurrer was overruled, and, plaintiffs in error not desiring to plead further, judgment was taken against them for $213.86,-the sum at the time due on the note, if it was usurious. This judgment was affirmed by the circuit court and this proceeding brought to reverse both judgments.
A promissory note, bearing interest at the rate of 8 per cent. per annum, payable semi-annually, is not usurious, although it stipulates that the semi-annual installments of interest shall bear interest at the same rate if not paid when due. [1]
Gilmore & Holt , for plaintiffs in error.
Foos & Fisher , for defendants in error.
BRADBURY (after stating the facts as above .)
The contention of counsel for plaintiffs in error is that the stipulation in the note that the semi-annual installments of interest, if not paid when due, should bear interest at the rate of 8 per cent. per annum renders it usurious on its face, and that therefore only 6 per cent. interest can be recovered in an action on it. If that view is correct, the demurrer ought to have been sustained, for then the admitted payments would have satisfied the note. The first section of the act of May 4, 1869, (66 Ohio Laws, 91,) provides ‘ that the parties to any * * * promissory note * * * for the forbearance or payment of money at any future time may stipulate therein for the payment of interest upon the amount of such * * * note * * * any rate of interest not exceeding eight per centum per annum, payable annually.’ This statute was under consideration in Cook v. Courtright , 40 Ohio St. 248, and the court there held (1) that a promissory note is usurious, though it contains a stipulation for the semi-annual payments of interest at the rate of 8 per cent. per annum; and (2) that the semi-annual installments of interest will bear interest at the rate of 6 per cent. per annum from the day it fell due, but forms no part of the interest stipulated for ‘ upon the amount of the note.’ This decision has become a rule of property, and we see no sufficient reason to disturb it now. It furnishes a rule by which the rights of parties to this action can be ascertained. It establishes the doctrine that the payee of a...
To continue reading
Request your trial