142 Ky. 619 | Ky. Ct. App. | 1911
Opinion op the Court by
Affirming.
Appellee sued appellant in the court below upon a note of $603, executed March 13, 1907, payable one day after date and bearing six per cent, interest from date. The note was secured by a mortgage of the same date upon personal property. Judgment was asked by ap
Appellee by reply controverted the affirmative matter of the answer and counterclaim, and pleaded the statute of limitation, as to the usury sought to be recovered by appellant. .
Appellant filed a rejoinder traversing the plea of the statute of limitations and other affirmative matter of the reply, which completed the issues. The circuit court allowed appellant credit for $196 of usury found to be included in the note, and gave appellee judgment against him for $407 with interest from March 13, 1907: also for the enforcement of the mortgage lien and a sale of the mortgaged property, or enough thereof, to pay the debt and costs of the -action. Prom that judgment this appeal is prosecuted.
It appears from appellant’s answer and counterclaim, and also from his deposition found in the record, that he began borrowing money from appellee as far back as 1902. The first amount he borrowed was $100 which he claims to have paid back within the year; the other amounts borrowed from time to time down to 1907, were as' small as $50 and never greater than $100. On all sums borrowed he claims to have paid interest from time to time in advance, at the rate of six per cent, per month. If correct' in this statement it is manifest that the interest paid was largely in excess of the legal rate; but appellant was unable to remember and exhibited no statement which showed the amount of interest thus paid, or when paid, except that he produced a receipt for the payment of the first $100 he borrowed of appellee, and another for $6 interest he claimed to have paid on the first loan. The receipt shows that it was executed for interest paid, but does not indicate upon what loan it was paid, at what rate, or the period covered by it. According to his testimony he borrowed of appellee from 1902 down to 1907,
It is not alleged in the answer and counterclaim that appellant is lacking in mental opacity, that he was overreached in this transaction, or that he executed the note and mortgage under duress; and it is beyond belief that in order to borrow another $100 of appellee who was, as he now claims, then owing him more than that sum for over payments on the former loans, appellant should have executed to appellee the note and mortgage for $603.
Appellant testified that he left with his son a statement showing the various sums he had borrowed of appellee and when borrowed, find also the several payments he had made him as well as the date of each; but he did not procure or file the statement with his deposition, although the son lives in or near Louisville and could have been reached in a few minutes time.
It will thus be seen that the testimony furnished by appellant’s deposition as to the usury and other payments made by him to appellee is too vague and inconsistent with reason to satisfactorily support the defense of payment interposed by his answer and counterclaim, His deposition constituted his entire proof in the case and the burden was upon him to show that the debt for which the note sued on was executed, had been paid.
It also devolved upon him to show what amount of usury,- if any, is contained in'the note. While his deposition fails to show in any definite sense the amount of such usury, it does sufficiently establish the fact that payments of usury were made by him on the loans obtained of appellee, and it is evident that some of the usury that accrued and was computed on the loans was carried into the note sued on, but it is impossible from the record before us to determine the precise amount; it can only be approximately arrived at.
The data furnished by the record is not sufficiently definite to enable us to demonstrate by the necessary calculation the precise amount of usury contained in the note, but we assume that the circuit court arrived at the amount for which judgment was given by computing.
Appellee’s plea of the statute of limitation was properly disregarded by the circuit court. If, as appellant testified, the $100 he borrowed of appellee in 1902, was, together with the usurious interest it bore, repaid that year and its payment closed the transaction, it would seem that as to such usury as he paid on that $100, the statute would har a recovery. We gather from the evidence as a whole that from the time of the first borrowing in 1902, which was the $100 referred to, down to the execution of the note and mortgage, March 13, 1907, apr pellant was continually in debt to appellee for money borrowed of him, paying him or being charged by him, usurious interest at some rate thereon, and that the principal and legal interest of none of the sums borrowed by appellant of appellee was ever fully paid before he would procure of the latter another loan which, when made, would be merged with what appellant was owing on former loans into a new obligation, thereby making each obligation, as created, contain some part of the usurious interest with which he had been charged and a part of which he had paid from the beginning, and in this way a considerable part of such usury was carried into the note bf March 13, 1907.
The statute of limitations does not begin to run in an action to recover usurious interest until the usury has been paid. Fitzpatrick v. Apperson’s Exrs, 79 Ky. 272; Roberts v. Thomas, 4 R., 227; Anderson v. Trimble, 18 R., 507; Burnside v. Mealer, 26 R., 79. Notwithstanding
The reason for this rule is that payments, though made by a borrower as usury, will, at his election, be applied first upon the legal interest then due, and then upon the principal, so that, if he elects, no usury cau be regarded as having been paid until the satisfaction of the principal and legal interest. Neal v. Rouse, 93 Ky., 151; Bank of Russellville v. Coke, 20 R., 291; Crenshaw v. Crenshaw, 24 R., 600; Crenshaw v. Duff’s Exor, 24 R., 718; Day’s Admr v. Davis, 20 R., 869.
Although the law permits the recovery of usury paid, or that the claim sued on be purged of usury, it does not forfeit the money of the usurer. He cannot be deprived .of his principal and legal interest, and these the judgment gives him.
There being no error apparent in the judgment of the .circuit court, it is affirmed.