Fay v. Grimsteed

By the Court, Brown, J. The counsel for the plaintiffs asked the court upon the trial of this cause, to charge the jury in substance, that unless they believed from the evidence that upon the loan of money represented by the note, there was an agreement to pay interest, of the exact character set up in the answer, the plaintiffs were entitled to recover. The judge re — 329 — fused so to charge, and I think he was right. That the defendant was required in his answer to state the usurious agreement as it existed, will hardly be denied. There is no longer any such plea as the general issue, and there can not be an answer in that form. The practice which once prevailed, of giving the defence of usury in evidence under the general issue in assumpsit, which was a general denial of the promise to pay, has been taken away with that form of pleading. It is one of the principal objects of the code of procedure to abrogate the old forms of pleading, and to bring the parties to a plain, concise and direct statement of the facts which constitute the cause of action, or the defense, in place of the general statement heretofore in use. The form of allegation and counter allegation was adopted with a view to compel the adverse parties to disclose to each other the facts upon which they rely, to uphold the claim upon the one side, and to maintain the defense upon the other; so that each may know what he will be required to establish or repel by the proofs upon the trial. In this respect the pleadings are similar to those which obtained in the courts of equity. The defense of usury must therefore be distinctly set out in the answer of the defendant, where he means to rely upon it as a defense, and the terms of the usurious contract, and the quantity of interest or premium taken or agreed to be given, must be distinctly and correctly stated. (4 Paige, 526.) The real question, however, involved in the refusal of the judge to charge as the plaintiffs requested, is that of variance between the pleadings and the proof. Formerly, when usury was pleaded to an action on a specialty, or set up in the plea or answer to a bill in equity, the defendant was required to prove the agreement as stated; and if the proofs disclosed a usurious agreement different from that stated in the plea or answer, the defendant failed in his defense. (3 Durn. & East, 538. 4 Paige, 533.) So that it sometimes happened that a party with a good defense of this nature, was defeated upon the trial or hearing, because the facts by which it was to be made out were imperfectly known, or inaccurately stated at the time the issue was framed. This is also one of the defects in — 330 — the ancient system which the code seeks to correct; a variance between the pleadings and the proof sufficient to defeat the action or destroy the defense, must leave the case unproved in its entire scope and meaning. If left unproved in some particular, or particulars, it is a subject for amendment, upon terms, if the adverse party has been misled by it; otherwise, amendments may be made at the time of the trial, and without any conditions whatever. (Code, §§169, 170, 171.) The gist of the defense in this case was the corrupt agreement for a larger rate of interest than that allowed by the statute, which the law denominates usury; and had the agreement proved upon the trial provided for a rate of interest forbidden by law, although greater or less in amount than that set out in the answer, it would have been a case for amendment within the 169th or the 170th section, and not such a failure of proof as would have entitled the plaintiff to a verdict. The jury rendered a verdict for the defendant, and the plaintiffs made two other points upon the argument at bar. 1st. That the judge erred in the charge he did give to the jury. 2d. That the verdict is unsupported by the evidence. Both these points must, I think, be determined for the plaintiffs. The action was upon a promissory note; that it was made by the defendant, was payable to the order of the plaintiffs, and was a renewal or continuation of a series of notes, the original of which was given for money lent by the plaintiffs to the defendant, were facts established at the trial. The only defense was a usurious agreement to pay at the rate of fifty cents per day, for the use of each hundred dollars mentioned in the note. The burthen of this defense rested upon the defendant. 'When the plaintiffs rested their case their right to a verdict was clear, and unless the usurious agreement was made out by the evidence to be given, the court and jury were under a binding obligation to see that this right was not defeated. The defendant examined three witnesses—two of them, the plaintiffs in the suit, and the other, James Bennett, the indorser upon certain checks which accompanied the notes. As I read the testimony, not one word was elicited, from either of these witnesses, tending to estab — 331 — lish the defense. It was proved that the plaintiffs were money brokers, that the notes were all payable four days after date, that the renewals had been frequent, and that Fay made the loan, and drew the notes, while alone with the defendant at his desk, behind a green screen, in a basement room in Wall-street. Fay testified that the loan was made at seven per cent, and that no more than that rate of interest was taken. When the attention of the counsel for the plaintiff was called, upon the argument, to the absence of proof in connection with this evidence, we were told that Fay’s manner, while under examination,, discredited him with the jury ; that his answers were evasive and incoherent, and that he became confused and sick, and required water to drink to enable him to go through the examination. Admit all this to be true: admit, for the sake of the argument, that the witness’ deportment and answers were such as should discredit him, and what then ? He was one of the plaintiffs, it is true, and I am not prepared to say that such circumstances might not have strengthened an otherwise feeble case, on the part of the defense. But in the absence of all other proof, they amount to nothing; because there is nothing in the defendant’s case to be corroborated and strengthened by circumstances of mere suspicion. The most that could be claimed for the defendant would be, to strike Fay’s testimony from the case altogether, and then it would stand precisely as it did when the plaintiff rested. The short-time 0 at which the notes were made payable, the frequent renewals, the manner of one of the plaintiffs while under examination as a witness, even the green curtain drawn round the broker’s desk in a basement room in Wall-street, are circumstances of themselves which afford no evidence whatever that the note in controversy was tainted with usury. A verdict resting on such grounds can not be upheld. It is a verdict against the law. And to suffer it to stand could have no other tendency but to weaken the security of property and lessen the respect which belongs to the administration of justice. When the proof was closed and the cause had been summed up by the counsel on both sides, the court charged the jury that “ the only question was, whether the plaintiffs contracted to re — 332 — ceive more than seven per cent interest on the note, and that if by any contrivance, or under any pretense, the plaintiffs, on taking the note in question, contracted to receive, and the defendant contracted to give, more than at the rate of seven per cent per annum for the loan or forbearance of money, it rendered the contract void : and that it was for them to determine, from the evidence given, whether such unlawful interest was contracted for, and if they found that it was, their verdict should be for the defendant; if not, for the plaintiffs.” To this charge the counsel for the plaintiffs excepted, and I think the exception well taken. The charge contains a simple and correct exposition of the law of usury, as applicable to the case under consideration; and had it ended there, would not have been open to any objection. But when the learned judge proceeded further, and told the jury “ it was for them to determine from the evidence given, whether such unlawful interest was. contracted for,” I respectfully think that he erred; because his language implied, that there was something upon which the jury might exert their judgment; some field wherein they might exercise their discretion, and some evidence from which they might legally infer that the usurious agreement was established. What else could they suppose this portion of the charge to mean ? They were told, “ it was for them to determine from the evidence whether such unlawful interest had been contracted for; and if they found it had been, their verdict should be for the defendant.” From what evidence were they to determine this question ? From the evidence given upon the trial, certainly, for there was no other evidence that the jury had heard, or with which they had any thing to do. Jurors are constantly inclined to look to the opinion of the. judge for instruction as to what is and what is not evidence. In this respect their duty and their inclinations are in harmony. In regard to questions of law they expect to be guided by his superior knowledge, and to confide in whatever intimation comes from him: and when he tells them to determine a given problem, from the evidence before them, they can hardly do otherwise than inffer that in his judgment there is evidence upon which their verdict, when given, may rest for support. Where immaterial evi — 333 — dence is improperly admitted, a new trial will be granted, for a reason similar to that to which I refer, to wit: that the decision of the judge admitting the evidence to be given, made in the presence of the jury, is the expression of an opinion, that they may regard the evidence, in their deliberations. And it then becomes impossible to know how far it may have have influenced their judgment. (2 Hill, 292, note a. 2 Barb. S. C. R. 190.) If the case contains the testimony as it was given upon the trial, I think the jury should have been told that there was no evidence to sustain the defense of usury, and that the plaintiffs were entitled to a verdict. For these reasons, I think there should be a new trial, with costs to abide the event. (17 Wend. 501. 21 Id. 615. 6 Hill, 444 McCotjn, J. concurred. Morse, J. was of opinion that the verdict was against the weight of evidence, and should be set aside on payment of costs; but that it was not a verdict without any evidence- to support it. New trial granted, and the costs to abide the event.