Tufts v. Shepherd

The opinion of the Court was drawn up by Davis, J. The notes in suit were overdue when they were transferred to the plaintiff by John Tufts, to whom they were originally transferred by Flanders, the payee. The promisors can avail themselves of any defence against the plaintiff which would have been good against John Tufts, if he had not tranferred the notes. There can be no doubt that John Tufts, when he received [314] the notes, knew that they were made by the defendants for the accommodation of Flanders. They, therefore, had no validity, as contracts, until they were discounted by him, and the retention of more than the legal rate of interest was usurious. Knights v. Putnam, 3 Pick., 184. He discounted the notes the day after their date; and he agreed with Flanders to wáit for payment one year and one day from the date. And, at the request of Flanders, he wrote upon the margin of each note — "this note runs one year and one day from date.” It is contended that this was an alteration of the notes, and an extension of the time of payment. But the writing was evidently not intended to constitute any. part of the notes. It was merely a memorandum of the agreement made between Tufts and Flanders. The time of payment was specified in the notes, and this would have been repugnant! But, construed as the evidence of the arrangement made by Tufts and Flanders, it agrees with the obvious intention of the parties. Nor was this an agreement to extend the time of payment. The parties to it do not seem to have taken the days of grace into the account at all. This is apparent from the computation of interest. No days, of grace were reckoned in the discount of the extra interest. The forty dollars reserved amounted to the interest for one year, and no more. The notes were therefore to be paid by Flanders in one year from that day. This agreement constituted no part of the notes, and did not, therefore, extend the time of payment beyond the days of grace. They were not due until one year and three days from their date. The rights of the plaintiff being the same as those of John Tufts, he is entitled to recover nine hundred and sixty dollars, with interest thereon to Feb. 27, 1857, and, after deducting one hundred dollars from the amount, with interest upon the balance, to the date of the judgment. And the defendants are entitled to judgment against the plaintiff for their costs. Tenney, C. J., Eice, Cutting, May and Goodenow, JJ., concurred.