70 W. Va. 456 | W. Va. | 1912
Lead Opinion
Plaintiff brings error to the judgment below,- setting aside the verdict in his favor and awarding defendant a new trial.
The suit was in assumpsit, and except one item, “To one dump cart, $50.00,” the purpose of the suit is to recover' interest on the principal sum, $21,085.00, for building certain ■ coke ovens, during the year 1905-06, audited and credited by defendant to plaintiff, some months prior to payment.
“PittsbuRg, pA_^ p)eC- 4til) 1906.
“Received of Federal Coal & Coke Co., twenty-one thousand six hundred ninety-five dollars in form of 2-6 mo. notes for $10,000. each, and check for $1695.00 in settlement of account. $21,695.00. _ ' JOHN R. BENNETT.”
It is conceded that the notes and the check receipted for cover the exact amount of the principal, and $610.00, included in the cheek for'interest on the notes from their date to date of maturity, and that nothing was included, or intended to be included for "interest prior to the date of the receipt and settlement. The interest which the plaintiff sues for in this action is the interest which he claims accrued to him on the principal sum, from April 1, 1906, when he alleges -the principal sum should have been paid, and the date of his receipt and settlement, claiming to have accepted the notes and check under protest, and with the understanding on his part that the prior interest was to be adjusted between him and the president of the defendant company, when he should recover from his then illness, and be able to attend to business. The president died a few days afterwards, and the interest was never adjusted, wherefore this suit.
Refusing plaintiff’s two instructions embodying the contrary proposition, the court below on the trial, 'at the instance of defendant and' over the objection of plaintiff, instructed the jury in substance, that if they believed from the evidence that plaintiff and defendant made a settlement on December 4th, 1906, and that the plaintiff accepted from the defendant the two notes for ten thousand dollars each, and the check or voucher for $1695.00, and thereupon signed and delivered to the defendant the receipt above mentioned, plaintiff was not entitled in this action to recover any interest theretofore accrued on the items, and amount therein settled,, and that he was estopped from recovering any such interest in the absence of an express contract
It is not pretended or proven that there was any such express contract. Plaintiff relies solely on an implied promise to pay interest from April 1, 1906, the latest date when by the terms of his contract, as he claims it, estimates were to have been furnished him, and the estimates, or principal sums paid.
The general rule of law in this, as in other jurisdictions, urn doubtedly is, that where the demand of the plaintiff is liquidated, or if unliquidated, can he readily ascertained by computation, as in this case, interest thereon will be allowed, if the demand is for work done or materials furnished, from the time the material is furnished, or work completed, or from the time when by the terms of the contract payment should have been made. 22 Cyc. 1513, 1514, 1540, 1543; Becker v. New York, 77 N. Y. App. Div. 635, 78 N. Y. Suppl. 1064. It is equally well settled, as shown by the authorities cited, that when there is no express contract to pay interest, there is an implied contract to do so. Chapman v. Shepherd, 24 Grat. 377; Roberts v. Cooke, 28 Grat. 207; Cecil v. Deyerle, Id. 775; McVeigh v. Howard, 87 Va. 603; Kent v. Kent, 28 Grat. 840; Cecil v. Hicks, 29 Grat. 1.
But what is the relationship of the interest to the principal? Is the interest a part of the debt, or only an incident to it, recoverable along with the debt, or. by way of damages for the wrongful detention thereof? On the proper answer to these questions depends the answer to the question above propounded, what is the legal effect of the receipt given in December, 1906 ?
The authorities we believe to be uniform in holding, that where the contract or obligation to pay money bears interest on its facej by express stipulation, the interest becomes an integral part of the debt, as much so as the principal itself. 16 Am. & Eng. Ency. Law, 1032; 22 Cyc. 1570, and authorities cited in note 78, and the Virginia authorities above cited. At least payment of the principal sum will not defeat a subsequent action to recover the balance for interest carried by the contract. 22 Cyc. 570-1, and notes; 16 Am. & Eng. Ency. Law. 1033.
But the contract we have here is one which does not bear interest on its face; there is only an implied contract to pay in
For the proposition that interest on an implied contract is a mere incident to the debt, and that after payment of the 'principal interest cannot be recovered by separate action, defendant’s counsel rely upon the following authorities: Brewster v. Wakefield, (Minn.) 69 Am. Dec. 343; Graves v. County, 104 Fed. Rep. 61; Southern Ry. Co. v. Dunlop Mills, 76 Fed. Rep. 505; Smith v. Buffalo, 39 N. Y. Suppl. 881; Fake v. Eddy, 15 Wend. 76; Stewart v. Barnes, 153 U. S. 456, and the leading Case of Moore v. Fuller, 2 Jones (Law) 205, a North Carolina case, and 22 Cyc. 1572, 1573.
These authorities fully support the proposition contended for. In Stewart v. Barnes, supra, Judge Shiras says: “Interest in such cases is considered as damages, and does not form the basis of the action, but is an incident to the recovery of the principal debt. The right of action is the right to compel the payment of the money which is being retained. When he who has this right commences an action for its enforcement, he at the same time acquires a subordinate right, incident to the relief which he may obtain, to demand and receive interest. If, however, the principal" sum has been paid, so that, as to it, an action brought cannot be maintained, the opportunity to acquire a right to damages is lost.”
Plaintiff’s counsel reply that in the application of the rules of law concerning interest to this case, interest should not be classified, as defendant’s counsel does, as (1) interest in the nature of damages, (2) interest due by express contract; that a proper classification would be, (a) interest in the nature of damages for the detention of money, (b) contractual interest, subdivided into, (1) interest due by express contract, (2) interest due by implied agreement, based on the presumed intention of the parties. They say the authorities are divided as to whether
Their principal proposition, and the one on which they rely, is, that in Virginia and in this State at least, and according to the decisions they rely upon, interest due by implied contract has the same relation to the principal debt, as interest due by express contract; that interest due by implied contract is as much an integral part of the debt, and as recoverable by separate action, as if borne on the face of the contract, and by express provision thereof, and recoverable by sepárate action.
Can this position be supported by authority? It is conceded that no Virginia or West Virginia decision can be found exactly in point, and none are cited, nor have we found any decision from any state supporting counsel to the extent claimed. Nor are any authorities cited by counsel illustrating the application of the law to their classification of interest. If their classification be the correct'one, in what kind of cases would interest be allowed by way of damages for the detention of money? They would say, perhaps, in actions for torts. But without ' statute interest is not usually recoverable in such actions. 16 Am. & Eng. Ency. Law, 1031. 'What the books generally mean when they refer to interest recoverable by way of damages, is interest recoverable, not by express contract, but by implied contract and as damages for the unlawful detention of the money. The Supreme Court of the United States, in Steimrt v. Barnes, supra, affirms this proposition in language already quoted: “Interest in such cases is considered as damages, and does not form the basis of the action, but is an incident to the recovery of the principal debt.” So in Graves v. Saline County, supra, it is held, that where interest is not stipulated for in the contract, and is recoverable merely as damages, or as an incident to the debt, it may not be recovered after acceptance by the creditor of full payment of the principal of the obligation. ' Citing numerous eases supporting the proposition, some of which have already been cited. To the same effect is 22 Cyc. 1572. In Davis v. Harrington, 160 Mass. 278, Justice Knowlton says:
But can the position of plaintiff’s counsel be supported by the principles enunciated, or the reasonings applied in the Virginia and West Virginia cases relied upon? The cases referred to are those already cited, of McVeigh v. Howard, Roberts v. Cocke, Kent v. Kent, supra, and Shipman v. Bailey, 20 W. Va. 140. It is argued that these cases regard interest, where the promise to pay interest is either express or implied, not in the
We have only found one line of decisions noting any exceptions to the general rule. One instance is where interest is given by statute for delay in paying money for land taken by condemnation, as in Devlin v. Mayor, 131 N. Y. 123. Another instance is where a charter law of a city provided that warrants issued for repairing sewers should bear interest, supplemented by a resolution of council, as in Smith v. Buffalo, supra, where it was held, that the interest became thereby engrafted in the debt itself. Another instance is where pursuant to an act of the legislature a railroad company by resolution, ordered that subscribers to stock be allowed interest on installments as paid, to be payable in stock, the interest to be carried to the credit of the stockholder annually, as in City of Ohio v. Cleveland & Toledo Ry. Co., 6 Ohio Rep. 489. A pertinent point of the syllabus in that case is: "Interest follows the principal as an incident to it, so long as it remains an incident; but where it is separated and set apart from the principal by actual payment, or by being carried, when due, to the credit of the owner of the principal, in his account with the debtor, and this in pursuance of a provision in the contract creating and defining the principal debt, it is so separated and disjoined from the principal, as to cease to be an incident to, and does not follow it.” The case here cannot be brought within the principles of either of these exceptional cases.
Lastly as to the effect of the receipt. On the theory that the interest sought to be recovered here, supposed to be due by the implied agreement to pay interest, is an integral part of the
For these reasons we are not disposed to apply the rule to interest due by implied agreement, and where it is not carried in the contract as an integral part of the debt.
Does the fact.that plaintiff may have received and receipted for the principal, under protest, change the effect of his action? The authorities say, no. 22 Cyc. 1573, and cases cited in note 90.
.Our conclusion is to affirm the judgment. Affirmed.
Concurrence Opinion
(concurring):
Yielding to the weight of authority, I concur in this decision; but, to my mind, it involves a contradiction. An implied contract to. pay money as interest or upon any other valid consideration is just as binding as an express contract. There is or is not an implied contract to pay interest for the use of money retained after it has become due and payable. Our decisions say there is, and money due is not satisfied by anything short of payment or a release in some form. The receipt is not conclusive and the parol evidence shows the amount received was not accepted as payment in full. If the interest was due by contract, it could not be satisfied or its existence negatived by mere conduct, affording ground for a contrary inference.
The rule here adopted will often work injustice as it has done here. A debtor may refuse payment and threaten defenses as a means of forcing a creditor, who is not in a situation to suffer delay without great hardship, to accept the principal sum without the interest and thus escape payment of a part of what he justly owes. Legal rules should make provision against such results.