17 Ala. 761 | Ala. | 1850
The evidence introduced on the trial and the instructions of the court to the jury present two questions for consideration. First, can the suit be maintained under the evidence ? 2d. If so, what amount is the Bank entitled to recover? The evidence shows that a judgment had been rendered in the Circuit Court of Mobile on the 27th February 1843, by which the charter of the Bank was declared forfeited, and that the bill of exchange sued on was acquired from Wilson, the endorsee
But it is contended, that as eight per cent, was deducted from the lace of the bill, for the time it had to run before maturity, the contract by which the Bank obtained it was void, because the Bank, by its'-original charter, could reserve only six,per cent, upon its loans and discounts; that if the contract had been made by the Bank, before the forfeiture of its charter, the contract would have been void for the want of capacity to make it; and consequently that the contract, by which the trustees acquired the bill, must be void, as their powers cannot be greater than the powers of the Bank under its original charter.
We do not think it necessary to examine whether a contract would have been void intoto, if entered into by the Bank during the continuance of its charter, by which a greater rate of interest was reserved than by the'law of its charter it was authorised to take; for the contract, by which the bill in this case Was acquired, was not usurious, nor was it a discount or a loan in the proper sense of these terms. A note or bill, which in the hands of the holder is a valid debt, may be. bought or sold as any other chattel at its real of supposed value, and the transfer of such a note or bill at á discount beyond the legal rate of interest is not usurious,, although the holder may endorse it, unless the transaction was a mere device to evade the statute against usury. — Cram v. Hendricks, 7 Wend. 569; Kent v. Walton, 7 ib. 256; Rich v. Mather, 3 ib. 296; 15 Johns. 44; Rapelye v. Anderson, 4 Hill, 472; 3 Shep. Rep. 163. The bill in the hands of Wilson constituted a valid debt; he transfered it to the Bank in consideration of the judgments held by the Bank against Harris; the transaction was therefore a
The only remaining question is, what amount was the Bank entitled to recover? The bill was endorsed for the accommodation of Bower & Co., the acceptors, and whilst in their hands created no valid debt. ■ It amounts to six thousand dollars', and had twelve months to run before maturity, and was sold by Bower & Co. to Wilson, from whom the Bank purchased it, for five thousand dollars. That the contract, by which Wilson acquired the bill, was usurious, was decided in this case when it was before this court at a previous term, and we think it beyond controversy, that this decision was correct. To hold that the purchase of a bill or note, which at the time does not constitute a subsisting debt, at a discount beyond the legal rate of interest, is not usurious, would be to hold that the statute against usury could be entirely avoided by the form of tl^e contract. But it is urged, that' notwithstanding the contract between Wilson and Bower & Co. was usurious, and although the Bank can recover only such sum as Wilson could, yet, under the act of our Legislature against usury, the Bank can recover the actual amount of money advanced by Wilson, with lawful interest thereon, from the time the bill fell due. But this we think would be an entire misconstruction of our statutes against usury. Under the act of 1S19, usury avoided the contract in toto, and no recovery could be had upon it; but by the act of 1834, the whole interest only is avoided, and by the express words of the act, the principal sum of money may be recovered. The amount
In conclusion, we will add, that the decision heretofore made in this cause was conclusive of it, and if attentively examined, ■ would have saved the trouble of again bringing it before this court, as wéll as the delay and expenses incident to it.
For the error we have pointed out, the judgment must be reversed and -the cause remanded.