Duck v. Selected Investments Corp.

WELCH, J. Plaintiff Duck sued de-dendant Selected Investments Corporation for the prescribed penalty for usury alleged to have been paid and collected on a loan of money. The controlling question, or the first question to be determined on this appeal, is whether the trial court committed error in sustaining defendant’s demurrer to plaintiff’s evidence, discharging the jury and rendering judgment for defendant. Therefore we will here, state only sufficient details of the pleadings and the plaintiff’s evidence to consider and dispose of that question. In material substance' plaintiff alleged the borrowing of $1,700, and the paying back of the aggregate sum of $2,325 principal and interest in 13% months, thus showing payment of $625 in usurious interest. The defendant’s answer in material substance admitted the loaning of $1,700, but pleaded that plaintiff and defendant in good faith entered into an additional separate and distinct transaction by which defendant agreed to sell, and plaintiff agreed to buy, a certain interest, represented by an investment trust certificate, in a trust fund and the earnings thereof which was set up and maintained pursuant to legally authorized and executed declaration of trust, and that defendant' was specifically authorized by law to set up and maintain such business trust, and to sell participating certificates therein; that the $2,325 paid by plaintiff was made in payments on the purchase of such interest or participating share in such trust fund, together with interest at the rate of 10% and no more on the loan of $1,700. Defendant attached as exhibits to its answer documents alleged to be copies of a “Subscription for Certificate” and “Investment Trust Certificate” employed by the parties in the purchase and sale transaction pleaded. The plaintiff, by reply, denied the allegations of the answer and alleged in effect that the purported separate *548 transaction by which defendant claimed the plaintiff purchased a so-called investment trust certificate was nothing more than a plan and scheme on defendant’s part to collect an unlawful rate of interest and to conceal that transgression of the law by the form only of some other transaction, and that in fact there was no such good faith transaction of purchase and sale as alleged by defendants in the answer. Upon trial before the jury plaintiff was the only witness. On direct examination she testified to the exact substance of the facts alleged in her petition so that her testimony on direct examination definitely stated the payment of usurious interest in the sum of $625. Also on direct examination the plaintiff identified and offered in evidence, without objection, a letter from defendant demanding final payment of $30.09 which referred to plaintiff’s loan as being “in the sum of $2,125.” Plaintiff then made final payment in that sum. This letter was in error in stating the amount of plaintiff’s loan and unexplained might tend to support plaintiff’s testimony, but, as above stated, the plaintiff testified definitely as to the payment of usurious interest, giving the details thereof. On cross-examination plaintiff was handed a document identified as defendant’s exhibit No. 1. She was. asked if it bore her signature and replied in the affirmative. Defendant then offered it in evidence as defendant’s exhibit No. 1, the court reporter’s notes describing it as “the subscription for certificate.” Plaintiff objected to defendant’s exhibit 1 as incompetent, irrelevant and immaterial, and not within the issues. However, we do not understand that objection, as the exhibit was within the issues, having been specifically pleaded by defendant. That objection was overruled and defendant’s exhibit 1 was admitted. When incorporated in the record this exhibit 1 included the investment trust certificate as well as the application or subscription therefor referred to in interrogating the witness. There were copies of the documents attached to defendant’s answer. During plaintiff’s cross-examination defendant introduced some other documents apparently offered and relied upon to sustain the allegations of defendant’s answer heretofore noted, which were relied upon by defendant in the pleadings. The plaintiff admitted little or no knowledge of such documents or the aggregate facts shown or represented thereby. Assuming, under defendant’s pleadings, that such documents constituted a proper part of the defendant’s case, and that they may have tended to prove the defense asserted, yet such evidence could not be weighed and considered upon defendant’s general demurrer to plaintiff’s evidence. The rule is well settled that a demurrer to plaintiff’s evidence admits every fact which plaintiff’s evidence in the slightest degree tends to prove, with all evidence favorable to the defendant or demurrant eliminated from consideration. See Murnan v. Isabell et al., 133 Okla. 160, 271 P. 649; Hyde Construction Co. v. Stevenson, 181 Okla. 8, 72 P. 2d 354; Herrian v. Union Equity Co-Operative Exchange, 172 Okla. 393, 45 P. 2d 151. Documentary evidence relied on by the defendant in his answer, though identified and offered in evidence while the plaintiff is on the witness stand, and though it tends to establish the defense pleaded, is considered as withdrawn in testing the sufficiency of plaintiff’s evidence to withstand defendant’s demurrer thereto. This rule was followed in Davis v. Curry, 192 Okla. 32, 133 P. 2d 186. In that connection see, also, Buellesfeld v. Jones, 187 Okla. 595, 105 P. 2d 242. Thus at the conclusion of plaintiff’s evidence, when defendant generally demurred thereto, the state of the record was that plaintiff’s oral testimony, taken as true, definitely established payment of usurious interest. Documentary evidence offered as defendant’s exhibits tended to indicate the nature of the defense, but for the pur *549 pose of considering the demurrer to plaintiff’s evidence these documents could not be weighed or evaluated as evidence and were treated as withdrawn for the purpose of the demurrer. It is therefore apparent that the trial court erred in sustaining defendant’s demurrer to plaintiff’s evidence. Whatever weight this documentary evidence might have when weighed and considered as a part of the defense, any reliance placed thereon by the court in passing upon the demurrer was premature. It is suggested in oral argument that the letter offered in evidence by plaintiff was merely an error insofar as it referred to plaintiff’s loan as being in the amount of $2,125, but no such explanation was given in evidence since defendant’s demurrer to plaintiff’s evidence was sustained, and defendant introduced no evidence either to explain the letter or to establish its defense by a good faith separate transaction by which the plaintiff agreed to and did buy and the defendant did sell the participating investment trust certificate, as alleged and relied on in defendant’s answer. Since we must reverse the judgment for error in sustaining the demurrer, thus requiring a new trial, we notice also plaintiff’s allegation of error in the rejection of evidence. The essential facts on that point are as follows: After cross-examination of the plaintiff accompanied by defendant’s introduction of several of its own exhibits, the plaintiff on redirect examination was asked the question, “Now on what statement or representation, if any, did you sign this big group of papers that has been introduced in evidence?” Defendant’s objection thereto was stained, apparently on the ground that the matter inquired about would be incompetent, irrelevant and immaterial. Plaintiff in her reply had not alleged any fraud or misrepresentation by defendant in connection with the execution of any of the documents set up in defendant’s answer. Thereupon the plaintiff made offer to prove that it was stated to the plaintiff at the time of the signing of those documents that they were merely in connection with and for the purpose of effecting her loan, and it was the plan and system used by the defendant in order to secure a loan from it. That offer of proof was objected to and the objection thereto was sustained. It will be noted that the above-quoted question and the subsequent offer of proof were both somewhat indefinite. If the plaintiff thereby sought to prove some fraudulent representation or false or fraudulent statement made to induce her to make the purchase referred to, then defendant’s objection might well merit sustaining for lack of allegation by plaintiff that there were any such false or fraudulent statements made which were relied upon by her in the purchase. By the question and offer of proof, if plaintiff intended and desired to refute the apparent contention of the defendant of a separate good faith voluntary transaction involving the purchase and sale of an interest in an investment trust, the interrogation and offer of proof should have been much more specific on the point. In that event the error of the court, if any, in rejecting such proof would have been much more apparent. It may be that plaintiff intended the more orderly practice of offering full details of her contention along that line in rebuttal after defendant in his evidence had established or sought to es-tabish the full character of the good faith separate transaction relied on in the answer. That intention and purpose on the part of the plaintiff is somewhat indicated by the fact that these matters were not inquired about in plaintiff’s direct examination. At any rate, upon further trial herein, any offer of proof on the part of plaintiff to establish payment of usur *550 ious interest and to refute defendant’s defense against the charge will doubtless be presented in more definite and certain language so as to obtain the admission thereof by the trial court or be sufficient to definitely disclose any error that ■ may occur in the rejection thereof. Certainly the plaintiff has full right to present any facts tending to show the alleged payment of usurious interest. While defendant has the complete right to present any facts tending to establish a defense by showing that no usurious interest was collected, the plaintiff in proper manner may refute any defense offered. For error of the trial court in sustaining demurrer to plaintiff’s evidence the judgment for defendant is reversed, and the cause remanded for new trial. GIBSON, C. J., HURST, V. C. J., and CORN, DAVISON, and ARNOLD, JJ., concur. OSBORN and BAYLESS, JJ., concur in result. RILEY, J., dissents.