139 P. 110 | Or. | 1914
delivered the opinion of the court.
Failing to meet the demand for the payment of two promissory notes, one for $719.81, the other for $64.90, plaintiff brings this action to recover of defendant two separate judgments. The complaint embraces the conventional allegations. The notes were executed and delivered by defendant to the Columbia Life & Trust Company, and by it indorsed to plaintiff. Defendant admits the execution of the notes, but alleges as a separate defense that for a number of years he was employed by the Columbia Life & Trust Company in the capacity of special' agent, soliciting and writing insurance policies for the company; that, in the event a prospective policy-holder did not have money sufficient to pay the first year’s premium for a life insurance policy, defendant was authorized to take the promissory note of the insured as payment for the first year’s premium; that the vice-president of the company told defendant to accept promissory notes as payment for the first year’s premium from any person whom defendant could induce to take a policy, and that the company would not hold defendant responsible in case of inability to collect; that the notes sued upon are equal in amount to notes executed by policy-holders to defendant in payment of their first year’s premium, and indorsed by him to the Columbia Life & Trust Company; that, when a policyholder did execute to defendant a note covering the first year’s premium, he would indorse the note to the company, and thereupon defendant was paid in cash an amount equal to about 50 per cent of the sum mentioned on the face of the note, which in this case amounted to $363.12 on the one note and $32.45 on the other; “and defendant alleges that the amount plain
Plaintiff, through his attorney, moved the court for an order granting a new trial, assigning therefor a number of grounds which were disallowed by the court.
A number of specifications of error are made on this appeal, though their orbit is around the question of the defense of usury, either upon the sufficiency of the pleadings, the testimony offered in support thereof, or the correctness of the instructions of the court as to the law applicable thereto.
The statute of the state on the subject of usury provides, among other things:
“Sec. 6028. The rate of interest in this state shall be six per centum per annum, and no more, on all moneys after the same becomes due; on judgments and decrees for the payment of money; on money received to the use of another and retained beyond a reasonable time without the owner’s consent, expressed or implied, or on money due upon the settlement of matured*416 accounts from the day the balance is ascertained; on money due or to become due where there is a contract to pay interest and no rate specified; but on contracts, interest up to the rate of ten per centum per annum may be charged by express agreement of the parties, and no more. ’ ’
Section 6030 provides: “If it shall be ascertained in any suit brought on any contract that a rate of interest has been contracted for greater than is authorized by this chapter, either directly or indirectly, in money, property, or other valuable thing, or that any gift or donation of money, property, or other valuable thing has been made or promised to be made to a lender or creditor, or to any person for him, directly or indirectly, either by the borrower or debtor, or any person for him, the design of which is to obtain for money so loaned or for debts due, or to become due a rate of interest greater than that specified by the provisions of this chapter, the same shall be deemed usurious, and shall work a forfeiture of the entire debt so contracted to the school fund of the county where such suit is brought. The court in which such suit is prosecuted shall render judgment for the amount of the original sum loaned or the debt contracted, without interest, against the defendant and in favor of the State of Oregon, for the use of the common school fund of said county, and against the plaintiff for costs of suit, whether such suit be contested or not.”
“Thus it appears that, in order to constitute usury, there must be (1) a loan express or implied; '(2) an understanding between the parties that the money lent shall or may be returned; (3) that for such loan a greater rate of interest than is allowed by law shall be paid, or agreed to be paid, as the case may be; and (4) a corrupt intent to take more than the legal rate for the use of the sum loaned. Unless these four things concur in every transaction, it is safe to affirm that no case of usury can be declared, and this may be regarded as a rule universally recognized in all of the states”: See Gaston v. McLaran, 3 Or. 389.
Measuring the allegations of the complaint by this rule, its insufficiency is apparent.
Concluding that the defense of usury is insufficient in substance to satisfy the legal principles applicable thereto, requires an order reversing the judgment of the Circuit Court. Reversed.