Young v. Scott
| Decision Date | 01 August 1826 |
| Citation | 25 Va. 415 |
| Parties | Young v. Scott, & c |
| Court | Virginia Supreme Court |
This was an appeal from the Richmond Chancery Court.
Scott had obtained a judgment at law against Young, for 750 dollars, with interest and costs, as endorser of a negotiable note, executed by Dabney. A forth-coming bond was given, and forfeited, and judgment obtained on it. Young then filed a bill in Chancery to enjoin this judgment, on the ground of usury.
The bill states, that the complainant became the endorser of Dabney on a note for 750 dollars, payable at the expiration of fifty days, which was delivered to Scott for the consideration of 712 dollars and 50 cents, which Dabney had borrowed of Scott: that this note was renewed several times and on every renewal usurious interest was charged: that the usurious interest paid by him amounted to 168 dollars and 75 cents, which, deducted from the sum of 712 dollars and 50 cents, the principal money borrowed, would leave the sum of 543 dollars and 75 cents; which is all that the complainant is bound to pay, and which he is ready and willing to pay. He therefore prays, that the judgment for the whole amount exceeding 543 dollars and 75 cents, may be enjoined. The bill calls upon Scott and Dabney to answer, on oath, all the allegations above set forth; but it does not allege, that the complainant is able to prove the usury by evidence independent of the defendants' answer.
Scott answered, denying that the sum originally borrowed was 712 dollars and 50 cents, but in fact 725 dollars: that on the several renewals of the note, two per cent. per month only was charged, but was never paid by the said Young; but instead of payment, the said Young gave his promissory notes for the greater part of the usurious interest charged; and he has only paid 135 dollars, as interest, & c.
An injunction was awarded, on filing the bill, except as to the sum of 543 dollars and 75 cents; and on the coming in of the answer, a motion was made to dissolve; and the Chancellor referred the accounts to a Commissioner.
The Chancellor dissolved the injunction for the sum of 242 dollars and 8 cents, with interest, & c. and made it perpetual for the residue.
Young appealed.
Decree reversed.
Johnson for the appellant.
Bacchus, for the appellees.
OPINION
It is a fundamental principle with Courts of Equity, that no man shall be forced to accuse himself; nemo tenetur prodere seipsum. In conformity with this maxim, those Courts have constantly held that a defendant may demur to a bill, calling on him to answer any matter which may subject him to fine, forfeiture, pains or penalties. Where the forfeiture or penalty is entirely in the power of the plaintiff, if in his bill he waives it, the defendant cannot demur, but must answer. The English Statute of Usury subjected the usurious lender of money, & c. to the loss of the sum lent. This, so far as it relates to principal and legal interest, the Chancellors have considered a penalty. When, therefore, a bill in equity called on the defendant to answer as to an usurious transaction, unless it waived the penalties of the act, and offered to pay the principal with legal interest, the defendant might demur. This practice of the English Courts, our Legislature have taken as the basis of the third section of our Act against usury; changing it only so far, as to subject the lender to the loss of all interest, and the payment of the costs of the Chancery suit. This statute I have always considered as made merely to place that on the ground of law, which was before practice; not to narrow or widen that practice, nor to make any change, except that the lender shall lose all interest and pay costs. I consider every bill in equity, for relief against usury, a bill under this section; that no man can come into that forum for relief from the principal sum borrowed, as that would be calling on equity to enforce a penalty; nor is he obliged to state in his bill that he has no evidence at all, and depends wholly on the answer; and if the answer deny the usury, he may prove it aliunde, if in his power. But however he may succeed, whether by the confession of the answer or other proof, I think, that in the language of the law, " the lender shall be obliged to accept his principal money without any interest, and pay costs, but shall be discharged from all other penalties of the act."
My opinion, of course, is, that the decree be reversed, and entered according to the principles laid down.
A bill was filed by the appellant against the appellee, to be relieved against a judgment at law, founded upon an usurious contract. The bill does not allege either that the plaintiff can or cannot prove the usury, without a discovery from the defendant; but, after stating minutely all the circumstances of the contract, and the subsequent transactions and payments, calls upon the defendant to answer many particular interrogations, affirmative answers to which would completely support the charges in the bill. There is no evidence of the usury, except the admissions of the answer, which are full.
The question is, as to the measure of relief; whether, under the provisions of our statute, the plaintiff is to be relieved upon the payment of so much of the principal sum as remained after deducting the payments made; or, under the principles of a Court of Equity, independent of the statute, upon the payment of the balance of principal and legal interest remaining due after crediting the payments. The Court of Chancery adopted the latter rule, and was probably led to it by the discussions in Marks v. Morris; Stone v. Smith & Ware, and M'Pherrin v. King; the bill not stating that the plaintiff could not prove the usury, but by the oath of the defendant, and not praying specific relief in the terms of the act, so as to shew that he claimed the aid of the Court by virtue of the statute.
It will not be necessary to give any opinion as to the result to which the Court came in Marks v. Morris. Whenever that shall be necessary, it should be considered in a full Court. But, it is necessary to consider one of the propositions asserted in that case: that upon a bill to be relieved against an usurious contract, the Court must apply the rule existing in Courts of Equity before, and independent of, the statute, unless the plaintiff prays relief upon the distinct ground that he has no proof of the usury, independent of the defendant's oath, and shews otherwise, that he claims relief under the statute exclusively.
To understand the object of the third section of our statute, it is necessary to see what were the principles upon which Courts of Equity proceeded in giving relief against usurious contracts, independently of our statute.
A Court of Equity has no jurisdiction to enforce penalties; and it was held that the offence prohibited by the statutes of usury, was the taking of more than...
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