
    DANIEL B. HOLCOMBE v. THOMAS R. HOLCOMBE.
    Submitted December 8, 1906 —
    Decided February 25, 1907.
    In determining the amount due from a debtor to his creditor, the rule applicable in the calculation of interest, where payments have been made from time to time by the debtor in excess of the interest which has accrued up to the date when they are respectively made, is that the excess shall be deducted from the principal. Where the interest always remains in excess of the payments, the proper way to determine the amount due is to calculate the interest and add it to the principal sum, and then deduct from this gross amount the total of the payments.
    On defendant’s rule to show cause.
    Before Gummere, Chief Justice, and Justices Garrison and Garretson.
    For the rule, Carrow & Kraft.
    
   The opinion of the court was delivered by

Gummere, Chief Justice.

This was an action lor money had and received. By the undisputed testimony in the case the plaintiff loaned to the defendant at different times between the 1st of November, 1873, and the 11th of February, 1874, the sum of $139, and the defendant gave him a statement showing the several amounts loaned, and containing the following acknowdedgment: “Thomas R. Holcombe’s account with Daniel Holcombe of money left in my hands on deposit, with interest at seven per cent, from date until paid.” It is admitted by the plaintiff that the whole of the principal has been paid — $20 in 1880, $10 in 1885, $20 in 1895, $30 in 1896, $2 in 1899, $5 in 1901, $13 in 1904 and $39 in 1905. The suit was brought to recover the interest due, and the court directed a verdict in favor of the plaintiff for $300.80, that being the amount of interest due as calculated bjr the counsel for the plaintiff. We are asked to grant a new trial on the ground that the amount of the recovery is excessive. The rule applicable to the calculation of interest in a case of this kind is stated 'by Chief Justice Whelpley in Baker v. Baker, 4 Dutcher 13, to be that where a payment is in excess of the interest which has accrued up to the date when it is made, the excess shall be deducted from the principal, but that no payment shall be credited unless it more than satisfies the interest. In other words, that where the interest always remains in excess of the payments made, the proper method for determining the amount due is to calculate the, interest and add it to the principal sum, and then deduct from this gross amount the total of the payments made. A calculation made under this rule will show that the amount of interest which had accrued from the 14th of February, 1874, which was the date when the last moneys were loaned to the defendant, to the 4th day of June, 1906, which was the day upon which the plaintiff was entitled to enter his judgment, was slightly in excess of the amount for which the verdict was directed.

The rule to show cause should be discharged.  