
    Reuben Moore v. Jeremiah Hylton and Henry Chamblis.
    From Stokosc
    Wherever the debtor, by the terms of the contract, can avoid '.lit. yinenl of a hrgvr, by the payment of a smaller sum at an earlier y, tile cuntract is not usurious.
    „-..i ¡••■'.■rs c. sc, the ¡.irjjer sum liecomes a penalty, against which Equity vv:ii relieve.
    constitute usury, the obligation to pay more than legal interest must be absolute upon the face of it.
    if hire the hoi.lor of » bond for the payment of n certain sum, pro. misen to surrender the bond upon the payment of a ¡ess sum at ait enrtUv day, to talc.■ advantage ot such promise, there must be !?. strict i c opSiance on the part of the obligor,
    ñu injunction is not dissolved of course upon the coming' in of the answer, in which the I'iaintitf’s whole case is denied. The ..tatc-manl of the Defendant mast be at least credible. Any evasion in not responding to the material charges in ihe bill, or an - xlrcme jr<in”o!)aoility in the statement of the Defendant, will induce ihe ilji'rt to retain the injunction.
    The Plaintiff uiiVíyoi!. íbat hi the month of January., iP.30, lit; pmT.imse.il of one Levi Loyd, Use agent of the Defendant, Chamblis, ü stallion.- — that Loyd gave a cer-'•iíjcüííi of the pedigree of the horse, and also of his age, which was; stated to be. eight years — that the price given was .'5400, foe which the Plaintiff executed Ids hondy which was dilheml by Loyd to Chamblis — that so'>i< af-tee Use Plaintiff discovered that be. bad been grossly deceived in the age of tbs horse, and notified Chamblis that he would not pay the bond given upon the purchase; —-that after receiving this notice, Chamblis, accompanied by the Defendant, Hylton, came to the house of th& Plaintiff, where Chamblis admitted the. horse, to be much older than had been represented to the Plaintiff, and ex-h'-v.1:-’;! his surprise that Loyd should have made such a statement — --that it was then agreed between the Plaintiff as-d Chambliss in consequence of this misrepresentatiosif that SSloo should be deducted from the Plaintiff's fa««fL ' ' ' and that the Plaintiff should pay the residue in a short time — -that the Plaintiff then applied to the Defendant, jjy[t01lt to lend him 8300 to pay off the balance of the ¡jon¿|, who agreed to advance it, if the Plaintiff would come to his house the nest day — that when the parties met, Hylton insisted upon having the Plaintiff’s bond assigned to him, which being done, he paid to ChamUis §300, and agreed that the Plaintiff should have the benefit of the deduction stipulated for by Chamblis, and then executed the following memorandum : “ 1 oblige myself “ to deliver to Reuben Moore his bond of,$400 given to “ Levi Loyd, on the payment of $300 by the 20th of “ June, 1820.” The bill then charged, that Hylton had commenced an action in his own name upon the Plaintiff’s bond, had recovered judgment, and was pressing an execution for the whole amount of it — the prayer was for an injunction, as to $100 of the debt.
    The Defendant, Chamblis, in his answer, admitted the sale of the horse, through the agency of Loyd, as charged in the hill — that the hond was made payable on the 25th of December, 1820, and was by Loyd left with the Defendant, Hylton, for coilection — that in May following the sale to the Plaintiff, he, the Defendant; went from his residence in Virginia to the house of the Defendant, Hylton, in Stokes County — when both of them went to the house of the Plaintiff — -that he, Chamblis, being then in want of money, on the way offered to sell the Plains tiff’s bond to Hylton, but that no bargain was then made ■ — that after their arrival at the house of the Plaintiff, he,. Chamblis, and the Plaintiff had some private conversation, in which the Plaintiff complained that the horse was more than eight years old — that he, the Defendant, stated the age of the horse to be twelve years, and that Loyd was not authorized to represent the horse to be only eight > — that the Plaintiff insisted upon having some d• Jaction from the bond, on account of the misrepresentation of Loyd, which was refused by him — but that he then in¡formed the Plaintiff, as the bond had a considerable time to ¡un, and he, the Defendant, was much in want of mo-noy, lie would take ior the boud gSOO, provided it: «as promptly paid — that the Plaintiff then agreed, if he could borrow the money, he would, either that evening or the nest morning, pay 8300 and take up his bond — that he believed the Defendant,, Hylton, had the money, and he would endeavour to borrow it of him — that the Plaintiff applied to Hylton to Send him the money, hut the Defend’ ant did not know what passed between them, farther that; that it was .hen agreed, that the parties should all meet the next day at Hylton’s house, when he, Hylton, refused <o lend the Plaintiff any money, hut bought his, the Plain-■iff’s, bond of him, Chamblis, for 18300. promising that if tito Plaintiff would repay him on the 20th of June following, he, Hylton, would deliver up the bond, am! that Hylton gave the Plaintiff an instrument in writing to that effect, stating at the same time, that if the Plaintiff did not thus repay him, he should exact the amount of the bom! — to which the Plaintiff assented, and promised either to pay the 8300 by the tinte limited, or to pay the amount of (he bond at its maturity.
    The Defendant denied all knowledge of the certificate given by Loyd to the Plaintiff, respecting the age and pedigree of the horse, and denied that Loyd was auiho» rized to represent the horse as of the age of eight years.
    The Defendant Hylton, in his answer, admitted the sale of the horse to the Plaintiff by Loyd, and that tho bond was left with him for collection — he stated, that up to the month of May after the sale, he never had seen the Plaintiff — that in that month Chamblis came to his house, endeavouring to raise money, saying that an execution was then out against h{s property, which would be sold unless he could raise, 8300, and proposed, that he,
    
      Hylton, should lend him that amount — that he, Hylton, proposed going to the house of the Plaintiff, from whom the money might probably be obtained — that while they wore at the Plaintiff’s house, Chamblis and the Plaintiff had much conversation, which lie did not overhear — that after it was over, the Plaintiff informed him, Hylton, £¡¡at jf |!e had gSQO he could take in his bond of 8400, and requested lum, Hylton, to lend him that sum, which was refused, the Defendant stating, that if he loaned money to either of them, it must, be to Chamblis, writh whom he was acquainted- — -that upon the repeated importunity of 'he Plaintiff, he agreed to meet at his, Hylton’s, house, the next day — that upon their meeting, he still refused to lend the Plaintiff any money, as he was utterly ignorant of his circumstances — the Plaintiff then insisted upon his purchasing the bond of Chamblis, stating most positively, that he would repay him in ten days . — upe-i which the Defendant did advance the money to Chamblis, took an assignment of the bond, and executed to, the Plaintiff the instrument already set forth — lie denied positively, that any deduction from the bond, on account of a fraud in the sale of the horse by Loyd, was mentioned to him, or that he knew of any complaint on that account before his purchase, and averred, that in several conversations between hith and the Plaintiff, before and after the expiration of the twenty days limited for the repayment of the money lent, the Plaintiff never, in any form, objected to the bond, on account of any fraud in obtaining it, but constantly stated his willingness to pay the 8400, unless he made the payment of 8300 by the time limited in the.instrument, given him by the Defendant.
    Upon these answers, the injunction was retained tie. til the hearing, and replications were filed. No testimony was however taken ; and after the cause had stood in the Court below on this order, for several terms, if was set for hearing, upon the bill and answers, and removed to this Court.
    JVash, for the Plaintiff.
    No Counsel appeared for the Defendants
   Ruffin, Judge.

— The point, upon which the PlainfifPs counsel has put this case, due» not arise. There is no usury, t vcn if it be taken for granted, that the advance of the g.;00, was-by way of loan from Hylton to Moore, For whetvver the deittor, by the terms of the contract, can atojtl the payment of a larger by the puyum nt of a smaller sime at an earlier day, the .contract is not usurious, but conditional; and the larger stun becomes a mere penalty. To constitute usury, the obligation to pay tm. *e than the legal rate of interest must be absolute upon the face of the transaction. Now regarding the assignment of the bond, and the instrument in the nature of a defeazance, given by Hylton to Moore, all as one transaction — as we must do, when we treat the advance of the money as a loan, and these papers as securities — they show the true debt to be SSOO, to be paid on the 20th of June under penalty of $400„— If this were usury, every penal bond would be void. — ■ Nor is there usury as between Moore and Hylton, upon the score of the discount allowed by Chamhlis; that is, taking <h*' transaction to be a sale of the bond by Cham-hlis. For a contract good in its creation is not avoided by a subsequent usurious agreement. The receipt of the unlaw fa! interest subjects the receiver to the penalty, hut the validity of the security is not impaired thereby.

But the Plaintiff is as clearly entitled to be relieved from the$ 100. regarding it as a penalty, as he would be ton the score of usury, did that exist, if there was a loan by Hylton to Moore, only the money advanced and interest can he now exacted, whatever the form of the securities may be. The excess beyond that would be either usurious interest or a penalty 5 in either case the Court would relieve.

It does not appear distinctly from the framing of the bill, whether the relief is put upon that ground or «¡ion t hat of the fraud in the sale of the horse, and the subsequent compromise between Moore & Chamblis. It is snanilestj that those two cases can have no connexion with each other, so as to create an equity for the Plaintiff. For itisimmaterial.what was the character of the dealings between Moore and chamblis, if in fact the money was lent by Hylton to Moore; for that is a new and independent contract.— It is to be regretted, that pleaders do not place the equity of tlieir clients upon distinct statements, calculated of themselves to support it, so that the ground of the relief might stand out visibly to the Court. Looseness and confusion in stating the Plaintiff’s case often embarrass the Court, and defeat the relief by not drawing from the Defendant distinct and proper answers. But it is unnecessary to pursue these considerations further, since the cause must be decided against the Plaintiff upon other points.

For allowing the hill to be duly framed, and to stand in tiie alternative, that there was a loan to Moore directly, and that the assignment of the bond was merely a mode of securing the repayment; or that Loyd was guily of a deceit in the sale of the horse, and that Cham-bits agreed to deduct 8100, as the valued damages on that account, and that Hylton purchased the bond after-wards with notice thereof: in either aspect, the bill must be dismissed, not for want of equity, but for want of evidence. The Plaintiff’s equity upon the first point has already been considered. That on the second head is equally clear — taking the facts for granted. That they áre true is most probable. For it is almost impossible to suppose, that Loyd should be sent off by Chamblis to make sale of a covering horse, without any instructions to the material fact of his age ; that Chamblis should have felt it necessary to hold his conversations with Moore, upon the simple matter of a'speedier payment of the bond, in private ; that Moore’s complaint of the fraud should not have entered at all into the agreement for the deduction ; that Chamblis should have entirely concealed from his particular friend Hylton, then his companion at Moore’s, and his host that night, those parte oí fbe cot! vera ation, which concerned Moore’s grievance 5 find (hat the agreement given in writing by Hylton, to ¡receive £¡300» imd no reference to the defect in the horse, and Chamblis stipulation to abate for it. Yet such the tale in the answers j which deny altogether and directly the fact of the loan $ deny the. fraud by Loyd j do not admit his certificáis) 5 admit Chamblis' agreement to -deduct glOO, but attribute it altogether to bis pressure for money, which induced him to aiiow tliat heavy discount for prompt payment; admit the written instrument, charged to have been given by Hylton ; but say, that it was a mere bounty, for that he refused to Send the mo-jjcy to Moore, but bought the bond from Chamblis. It venid be hard to believe witnesses who deposed to such a case j much more the answers of Defendants. The Court did therefore very right, to refuse to dissolve the injunction «pon (he coming in of the answers. Upon Thai occasion, the answers could he scanned j and altim' their contents arc generally to bs deemed trae, yet any evasion in not responding to the material charges of the biil, or an extreme improbability in the accounts given by the Def-ndants of die transaction, might well prevent (he Court acting on them. Upon a motion to dissolve, the Defendant is the actor. His statement musí' ¡ml therefore shock credulity itself. In such a case, the Court will keep up the injunction, to allow the Plaintiff iu 1 opportunity to except to the answer ; or let the case stand for proofs. For upon a replication to the answer, the Defendant must prove the whole of his case, and his íüHVver is only evidence of It, so far as it is responsive, to the Plaintiff5» charges,

Here ho proofs bare been taken 011 either side $ and die Plaintiff has overruled his own replication, by setting the cause down for hearing upon bill and answers. \Vhtti. hcfo.e we could not listen to, now becomes quite credible, because the Plaintiff expressly admits the truth of id ,;yon the record» The answers deny positively the loan: do not admit (he fraud, and deny any agreement to abate therefor ; and assert a sale of the bond by Chamblis to Hylton. Upon the answers, which the Plaintiff compels us to receive as true in all their parts, the case is this: a creditor agrees, without any consideration, and purely as a bounty, to remit to his debtor a portion of his debt. Such a promise is obligatory, neither at Law nor in Equity.

Henderson, Chief-Justice, concurred.

Hair, Judge,

dissenliente. — From the answer of Chamblis, it is more than probable, that a fraud was practised upon Moore by Loyd, as to the age of the horse he soid him, as the agent of Chamblis. And I collect it from that part of Chamblis’ answer, which says, that he had not authorized Loyd to state that the horse was eight years old, nor did he know whether Loyd knew the age of the horse or not. The extraordinary feature of this transaction is, that he should entrust an agent with the sale of the horse, who was ignorant of his age. But the enquiry need no¡ be pursued, as this answer is not evidence against Hylton.

Hylton admits, in bis answer, that the purchase of the. horse was the consideration of the bond, which Loyd lodged with him for collection : that Chamblis afterwards came to his house, and wished to borrow three hundred dollars from him, though he does not state that he offered him the bond for that sum. Had he purchased it at that time, for that sum, and without any knowledge of any fraud committed by Loyd, the bond then not being due, the Plaintiff would have been compelled to discharge it. It appears from Hylton’s answer, that they went to the house of the Plaintiff the next day | and whether on that day Hylton became the creditor of ihe Plaintiff, by contract, made on that day and afterwards at Hylton’s house, or whether he became such merely by bond from Ch,' ihfl ÍH»T, purchase ! signment o. ties. Cr.ipfi!) deduot'íín from the , , any fraud charged to Hi. Jlylton denies, that he b was alÍd against him. .iking an as-"A nní íi»*í.ísui between the par- , ■ ;uo uoswer, that tie made any * of the bond, on account of ; n committed by Loyd; and i i ■ any charge of fraud l:4,"„ci;e circumstances, it is a liitJo strange, that Hylton ¿¡tó tn,.s |'v.i--"?hase the bond before they went to the house of tb„ t-fiym*’*-', jp\, ?~r«P it appears, that when at the house oi »k> -“Ect IN-the Plaint iff, wished to borrow of Hylton ¿ • «i, ’ •; he could take in his bond for that sum, Hylton . :•<;]< in:.!, saying, he was unacquainted with his circumstances, and that if he loaned it at all, it must be to Chamblis, with vhotn he was acquainted. However, he says, upon re peated applications of the Plaintiff, he requested him to come to his house the next day, when they would consider further of the proposition ; that opon this meeting at his house the next day, he still declined loaning the money to the Plaintiff, because las circumstances were unknown to him: that the Plaintiff then insisted upon his purchasing the bond of Chamblis, and that if lie would do so, he would return the S300 in ten days, He, the Defendant Hylton, states, that, relying upon the Plaintiff’s representation, and depending upon his punctuality; he did purchase the bond of Chamblis, and took an assignment of it. He also admits, that he entered into a written contract with the Plaintiff, by which he obliged himself to deliver to the Plaintiff his bond of $400, on the payment, of S300 by the 20th of June, 1820. I think certainly, that Hylton could have purchased the bond from Chamblis for $300, without having any thing to do with the Plaintiff. And it may be asked, why did he not do this, rather than make a worse bargain with the Plain” tiff? I can answer no otherwise, than by supposing that Jlylton thought he would make a safe contract, by getting Plaintiff’s acknowledgment of the goodness of the bond | an(3 that Ire woilW.still get the full amount -'f it, as the Plaintiff would not retiirn the §300 by the time stinu-talet!; and if he did,-he wolfíp then-feceiv'íQíJo injuty, 3)ecause jn that case, he would rd^Sive his prin'ctg'&and interest. Another strong reason, ^tvhy he w ished the assignment of the bond as security for his debt, was, that William Moore was a surety to the bond. It is very remarkable, that from the time that Hylton and Chamblis went to the house of the Plaintiff, until the §300 was advanced at the house of Hylton, there was no contract made, or negotiation carried on between Hylton and Chamblis. The assignment of the bond was in consequence of the bargain made by Plaintiff and Hylton.

ft may now be asked, what was the contract of the Plaintiff and Hylton, after the assignment of the bond to the latter. The contract was, that the former borrowed of the latter §300, ami by his consent, and at his request, took as a security for it the Plaintiff’s bond for §400. As that was the sum borrowed, that sum with interest ought to be paid, and an injunction ordered as to the ¡glOO.

It is said, that the Plaintiff should pay §400, because the Defendant denies all fraud, and his answer is to be taken as true. My reply is, that the bond had several months to run before it became due. Chamblis was anxious to raise money, because an execution was pressing him, at home. This he stated'to Hylton, as he admits. He, Chamblis, offered to take §300 for the bond,, This caused the Plaintiff to be solicitous to borrow the money from Hylton. I think he did borrow it, and therewith purchased the bond, which Hylton took as his security for his debt of §300. ft is true, Plaintiff told Hyl-ton, if he did not return the money in so many days, he ■would pay (or forfeit,-as I say) the amount of the band. But this, as between the Plaintiff and Hylton, was a penalty, which the latter thought would be bis gain. But being a penalty, the law will not permit him to recover it. Me ought to be contented with the money loaned, and interest upon if. The $>400 was given up by Chamblis, for an advance of $>300, which Plaintiff borrowed of Hylton, and paid him in advance, before the bond became due, to relieve him from his then embarrassed situ - ation. The gain of glOO was the Plaintiff’s. I think there is enough to be collected from Hylton’s answer to come to that conclusion. Could we look into the v.holc transaction as it took place, it is more than likely k would be seen, that it was just that it should be so.

Per Curiam.

— Let the bill be dismissed with costs  