Brown v. Prophit

53 Miss. 649 | Miss. | 1876

Campbell, J.,

delivered the opinion of the court.

If the holder of a note which has become due agrees with the principal maker of said note that he may retain the sum due for a definite period of time, upon his promise to pay usurious interest, and such maker agrees to keep said sum for such definite time, and to pay said interest, this agreement will discharge a surety on said note not consenting to such contract for forbearance. Although the usury cannot be collected, the legal rate can be; and the absolute right to get interest for a given time is a valuable consideration to uphold a promise to forbear, and to tie the hands of the creditor, so that he cannot sue until the expiration of the time agreed on, as aforesaid. Chute v. Pattee, 37 Me. 102; McComb v. Kittridge, 14 Ohio, 348; 2 Am. Lead. Cas. (5th ed.) 469.

When our statute made usury a cause of forfeiture of all interest, it was justly held that a promise to pay usury was not a consideration for a promise to forbear. Roberts v. Stewart, 31 Miss. 664. A change in the statute causes a change in the result of such an agreement. The evidence in this case does not show an agreement by the creditor to forbear the collection of the note for any definite period of time. The payment from time to time of interest at two and a half per cent a month was, as to the one-half of one per cent, a payment of legal interest incident to the debt, and the two per cent was appropriable, in legal contemplation, to the discharge pro tanto of principal. Payment of two and a half per cent interest from month to month signifies nothing, if there was not a contract between the creditor and the principal debtor, by the terms of which the creditor was precluded, for some definite period, from demanding the payment of the note. If there was such a contract, the surety, not consenting to it, was discharged, whether there was a payment by the debtor of interest at the end of the month or not. If there was not such a contract, payment from month to month of the stipulated interest did not discharge the surety, even though, because of such payment, the creditor continued his indulgence to the debtor. Without pronouncing upon the several instructions given to the jury, the judgment will be reversed, and the cause remanded for a new trial, in which the rights of the parties can be tested by the principles announced in this opinion.