Thе appellant Holt brings this appeal from the findings, conclusions and judgment of the trial court wherein it ordered judgment in favor of appellee, Mrs. Rickett, based upon a promissory note. It is uncontested that by virtue of several transactions, Mrs. Rickett loaned Holt a total of $19,000. Holt executed a note for $10,000, which hе readily admits. Some payments were made on the $19,000 indebtedness, but Holt conceded some amount of indebtedness remained. It is likewise uncontested that Holt’s аttorney prepared the note and provided for the payment of ten percent interest, a rate in excess of that allowed by the usury laws of this statе. Holt did not dispute that Mrs. Rickett was unaware of the usury laws at the time he executed the note. Mrs. Rickett made demand for unpaid principal, interest as authorized by the note, and attorney fees. It was established that Mrs. Rickett had not paid any intangible property tax upon the note during the time it had been in existencе. After the taking of testimony had been completed, Mrs. Rickett amended her complaint to allege that she had in fact paid the intangible tax (six days after triаl had been completed but before the decision of the trial court).
Holt enumerates as error the award of attorney fees; the allowancе of the amendment indicating the payment of the intangible taxes and further the consideration of the evidence of payment by the trial judge; and lastly the allоwance of interest because the interest rate was usurious. Held:
1. The first enumeration has merit. In substance, Mrs. Rickett sent a letter of notification to Holt informing him that а note was past due and that if he did not make "satisfactory arrangements” within ten days, a default judgment, including attorney fees, would be taken against him. Though there was еvidence that the letter was mailed, affirmative evidence was presented that the letter was never delivered, accompanied by an unrebutted assertion by Holt that he did not have knowledge of the letter.
Code § 20-506 (as amended by Ga. L. 1968, p. 317)
*338
authorizes collection, as a part of the debt, of contractual obligations to pay аttorney fees on the creditor’s giving ten days notice to the debtor. The obligation to pay attorney fees is only a contingent liability and the debtor is not bound to pay them until there is a full compliance with conditions precedent stated in the statute.
Adair Realty &c. Co. v. Williams Bros. Lumber Co.,
2. In his second and third enumerations of error, Holt complains that the trial judge erred in allowing an amendment to Mrs. Rickett’s petition showing the payment of intangible taxes some six days after the case had been submitted to the judge for decision and in considering as evidenсe the exhibits attached to that amendment. Ga. L. 1937-1938, Extra Sess., pp. 156, 161 (Code Ann. § 92-125) provides in pertinent part that wilful failure to list intangible property for taxation bars an action upon that property and may be pleaded as a complete defense. The statute also provides that the holder may
at any time
pay the taxes and penalties, if any, and thereupon, without dismissal of the original suit, be relieved of inability to sue or to suffer a complete defense of such a suit. Prior to the decision by the trial judge in this case, Mrs. Rickett alleged without contravention by Holt in his defensive pleadings that she had paid the requisite taxes and penаlties. In the absence of a denial, this amounted to an admission of the truth of the allegation. Ga. L. 1967, pp. 226,230 (Code Ann. § 81A-108
(d)); Bailey v. Bruce,
3. In his last enumeration of error Holt asserts the rate of interest demanded in the note of ten percent is usurious; therefore, Mrs. Rickett should be limited to a recovery of principal only. If this were the usual usury argument, we would agree with the position taken by Holt. However, as indicated in the evidence and in the findings of fact by the trial judge, the note in this case was prepared for Holt by his attоrney. It was uncontroverted that Mrs. Rickett was not aware of the usury laws of the state at the time Holt presented the document to her and executed the sаme.
The taint of usury does not result from payment, but from the agreement, performed or unperformed.
Martin v. Johnson,
Nevertheless, the face of the note clearly calls for a usurious interest. What impact does the fact that the note requiring usury was prepared by the borrower and presented to the unwary lender? So far as this сourt can ascertain, there are no Georgia cases dealing directly with this situation. In fact, there appear to be comparatively few cases in which courts have been called upon to determine the effects of the borrower’s initiation of a usurious transaction upon the rights or remedies of the parties. However, the view taken by the majority of the courts which have considered the question is that the borrower is estopped to set up the defense of usury and may not claim the statutory penalties for usury. See Perry v. Shelby,
4. Because of the failure of the appellee to give proper notice, the recovery of attorney fees was unauthorized. Upon the condition that the attorney fees be written off upon the filing of the remittitur in the case below, the judgment is affirmed; otherwise reversed.
Judgment affirmed on condition.