Henry v. Thompson

The Judges delivered their opinions. The Chief Justice. The amount in controversy, the variety of principles involved, and the extraordinary efforts of the Counsel, combine to give to these cases a degree of importance not as heretofore attached to any cause in this Court; but with the state of public excitement or of public opinion as to the result, we have here nothing to do — as little have we to do with the hardships of these contracts, or the merits or demerits of the parties. We owe it to our consciences, to a liberal profession, and to an intelligent and virtuous community, to decide these cases, and all others which may come before us, according to the known principles and rules of law. The first question in the investigation is, What is the true construction of the Statute of 1818 entitled “ An Act to amend an Act against Usury,” the first section of which is in these words: “ That any rate of interest, or premium for “ the loan or use of money, wares, merchandize, or other “ commodity, fairly and bona fide stipulated and agreed up- “ on by the parties to such contract, expressed in writing, “ and signed by the party to be charged therewith, shall be “ legal and recoverable ; and no bona fide contract shall be “ vacated, or in any manner impaired, by reason of any “ premium or rate of interest so stipulated and expressed.” The fair rule of construing a Statute is, to consider what was the law before its enactment, and what the remedy in — 224 — tended to be advanced. The second Section of the Act' of 1805, entitled “ An Act against Usury,” enacts “That if « more t}jan the rate of six dollars for the forbearance or “ giving day of payment of one hundred dollars for one “ year, and after that rate for a greater or less sum or for a “ longer or shorter time shall be taken, accepted, or received “ by way of any corrupt bargain, loan, exchange, or interest “ of any money, wares, merchandize, commodities Or other “ things bought or sold, the same, together with the whole “ amount of interest taken, accepted or received therewith, “ may be recovered by any person paying the same, by ac- “ tion of trespass on the case with costs of suit.” Laws Ala. p. 443.) The old law restrained the taking of interest-on any contract whatever at a greater rate than six percent, per annum. The words used include not only the loan of money, but every article that could possibly be made, the subject of a contract. The Statute of 1818 was intended to i’emove the restriction either partially or wholly— to leave the parties at liberty to stipulate, for any rate of interest on any contract, without reference to its consideration, or to leave them so at liberty only as to particular subjects of contract. The Act of 1805 uses the words “ bargain, loan, exchange, “ or things bought or sold, forbearance or giving day of pay- “ ment,” &c., and is much broader and more comprehensive in its terms than the Act of 1818, which is limited to a “ loan “ or use of money, wares, merchandize, or other commodi- “ ty and by the obvious and only fair rule of construction which can be adopted, the words “ loan or use ” apply to money, goods, wares, merchandize, or other commodity. The words “ forbearance or giving day of payment,” used in the first Statute (but omitted in the last,) can be applied as well to an absolute sale as to a loan or use. What was the mischief under the old law which was intended to bo remedied by the Statute of 1818 ? It was said that capitalists would not lend their money without an adequate compensation ; that from the great activity of business and rapidly increasing prosperity of the country at that time, money was worth much more than the rate of interest as fixed by the Act of 1805. The neighbouring States, Mississippi and Louisiana, by their laws offered greater encouragement for the loan of money; and it was feared that much of our monied capital would leave the country if the restriction imposed by the Act of 1805 should not be removed. It was again and again asked, why not permit- the holder of money to sell or hire it for the best price it will command— nobody ever thought of restraining the planter in the sale of — 225 — bis cotton, or the farmer of his grain — why should not contracts for the loan of money be as free and unrestrained 1 Views of this sort as to the policy of limiting by law the rate of interest for‘the loan of money, must often have heen; taken by every one reflecting on the subject. I was a mem-her of the Legislature when the Act of 1818 passed, and was prepared to give it all the.support in my power, but it needed none — all appeared to be enamoured with the new (but as the event proved, fearful) experiment, and the Act passed without opposition. Although I cannot now see any objection to it in theory, I readily admit that its effects have have been deleterious in the extreme. Experience often proves that what appeared to be the soundest calculations of the human mind, as to.moral causes and effects, are but folly. The object of the Statute was to remove the restriction from the monied capitalist. He would receive the principal benefit. It was expected that the community at large would be benefited by the employment of money, which would otherwise remain inactive or seek a foreign market. Such were the objects which the Legislature had in view, and reason and the history of the times warrant this conclusion. Is not the Act of 1818 sufficiently broad to effeet those objects without enlarging its plain, direct, and obvious meaning ? If a contract on its face be a hard one, surely the aid of a liberal construction of the Statute should not be invoked in order to support it. In most of the contracts in these cases tire rate of interest is exorbitant. In some as high as 120 per cent, per annum : can we go beyond the plain literal meaning of the Statute to support such ? The terms “ a loan or borrowing,” have an apt, fixed, and certain meaning in common language, and would no more be taken to mean giving day, or credit-on an absolute sale of property, than to express any other idea the most foreign to the subject which the mind can conceive. Had it been the intention of the Legislature that the Act of 1818 should embrace giving day, on an absolute sale, to express such intention they would only have had to retain the expressions used in the Act of 1805. An attempt has been made to bring the authority of cases decided under the Statute of Ann to bear on the construction of the Act of 1818. The Statute of Ann had an object in view distinct and different from that for which our Act of 1818 was intended ; is expressed in di-^i'ent terms; and by a liberal construction would embrace the giving dav or credit on an absolute sale. Its obi«ct, like that — 226 — of our Act of 1805, was to prevént usury, and to guard against hard and unequal bargains. , ¶1}^ English Courts then, properly gave a construction to the English Statute in its most liberal and enlarged sense. But if a loan and a selling .are different Acts, by what rule of construction can we say, that in our Statute of 1818 the Legislature intended.to include both under the name of one ? The expression of the one is the exclusion of the other. Taking into view the object of this Statute, my mind is brought to the conclusion, that to authorize a higher rate of interest than eight per cent, per annum, the consideration must be a fair and bona fide loan, as distinguished from forbearance or giving day, on a contract of sale. To bring a bond or note within the operation of this Statute, is it essential that on its face it should-appear that the consideration was a loan ? Where a right is derived from a Statute, the party availing himself of such right must strictly conform to the Statute. At Common Law, parties might contract for interest, under certain restrictions, as to its rate; but what was the maximum of interest recoverable is- not settled. If the Act of 1818 - was only affirmative of the Common Law, the right would be derived from the Common Law and not from the Statute. If this Statute restores only in part a Common Law right, which a previous Statute had taken away, the party claiming the right must shew that he comes within the exceptions which the new Statute has made to the restrictions imposed by the old one. The Act of 1818, in the cases therein enumerated, authorized contracts for interest for an unlimited amount, if stipulated between the parties; and in this, gives a new right. It extends only to certain subjects of contract, and does not give a, general right. The right then, not being derived from the Common Law,.must strictly conform to the Statute from which it originates. This Statute requires that the contract should be in writing. What contract 1 No other could be meant by the Legislature than that for -loan or use. At Common Law, an action would lie on a promise, though not in writing, to pay the debt of another. The Statute of Frauds required that such agreement should be in writing. By the decisions under that Statute, it has been held that by the term agreement is meant not mere.ly the promise, but the consideration on which the minds of both parties were brought to agree ; that the consideration, as w^l as tfie promise, must be expressed in the writing. Here I Ufink is a strong analogy to the point under consideration I infer, that for a contract for interest to come within the operation of the first Section of the Statute, the con — 227 — sideration must, in all cases, appeal' to have been a loan. I ■am not prepared to say that if there has been a bona fide loan, and the consideration not set forth in the contract as expressed in writing, it could not be shewn by proper aver-ments. It would seem that an averment of the considera-tion would sufficiently apprize the defendant of the nature and cause of the action to put him on his proper defence. If the consideration was set out in the contract, it would require no other averment to shew it. As to the question — what is interest, and what penalty?— By the Counsel for the plaintiff in Error it is contended, that a note, payable at a future day, to bear interest from the date if not punctually paid, will not carry the back interest — but this in law is a penalty ; and calling it interest will not change its character. A penalty is an agreement to pay a greater sum to secure the payment of a less sum. It is conditional; and can be ■avoided by the payment of the less sum before the contingency agreed upon shall happen. It is immaterial by what name it is called. If it accrues in a gross amount on the maturity of the note, it is penalty and not interest. (Dinsmore vs. Hand, decided here at the last term. (a) Astley vs. Weldon, 2 Bos. and P. 346.) The nature of interest is absolute and unconditional, to run on a debt due and •withheld. It is contended that the case of Dinsmore vs. Hand was a contract under the Act of 1805, and -can have no bearing on these cases — that the Act of 1818 authorizes this stipulation for back interest. I am of opinion, that so far as the contracting parties confine themselves within the rate of interest fixed by law, there is no difference, as to this matter, between the two Statutes. On the principles of the decisions on contracts of thisnature, it is a penalty ; no matter whether it be at a rate within the Act of 1805, or contracted for since the passage of the Act of 1818. As to the 2d, 3d, and 4th classes of cases, as arranged in the brief and arguments of the Counsel for the plaintiffs in Error, Í am of opinion, that if the consideration had been a fair and bona fide loan, the parties had a right to stipulate any rate of interest, to run from any given day, without limiting it to a future day or to the maturity of the note; provided the contract as to the interest be absolute and unconditional. I am also of opinion, that however unconscientious such contracts may appear to be, a Court of Eaw can exercise no other controul over them than to confine the parties to the rigid rules of law; and that the exercise of any other — 228 — would be aii assumption of Legislative powers, and beyond the proper sphere of judicial power. ■ Judge Saffold. The number of cases depending on the decision to be now made, the variety of the points made in the argument, and the amount in controversy, give more than usual importance to the questions now before us. I approach the subject with a corresponding diffidence. On the part of the plaintiffs in Error it is contended, that to bring the contracts within the operation of the first Section of the Statute of 1818, entitled “ An Act to amend an Act against Usury,” the contract must not only be in writing, but. on its face must shew that the consideration was a loan of money, that the right to interest is derived solely from the Statute law; and if the contract do not appear as above described, interest is recoverable only at the rate mentioned •in the second Section of the Statute, — eight per cent, per annum. it is also contended, that supposing it unnecessary that the consideration should be shewn in the instrument, yet in most of the cases the agreement to pay the premium was not absolute, but depended on the contingency of failing to make punctual payment of the principal, and must therefore be considered as a penalty; that where the premium or interest, as expressed in the note, is to run until the principal is paid, the reference is to the time limited for payment by the note; or if on-the construction of the instrument it is to be inferred that a longer time was intended, the premium is exorbitant and ought to be rejected as unconscionable. On the part of the defendants in Error most of these positions are controverted, and it is contended that these contracts come within the operation of the first Section of the Statute cited. That all debts carry interest according to its rate as fixed by the law in force at the time of the contract, or by the agreement of the parties within the limits •of the law; and that the interest continues to run at such rate' until the debt shall be satisfied or merged in a judgment; and that on simple contracts relief against a penalty can be had only in equity. Although it has been denied by the historian Hume and some others, that interest was allowed by the Common Law, I think it satisfactorily shewn by eminent Jurists (among whom may be mentioned Justice Blackstone and the compilers of Bacon’s abridgment) that notwithstanding the doubts and prejudices on this subject prevailing in England ®t different times prior to any Statute concerning it, a moderate rate of interest fairly contracted, for the loan of — 229 — •money, was sanctioned and allowed by the Common Law; but if the rate was exorbitant, it was considered usurious and unlawful. By^Grotius it is said, “ if the compensation al- “ lowed by law does not exceed the proportion of the “ hazard run, or the want felt by the loan, its allowance is “ neither repugnant to the revealed nor the natural law ; but “ if it exceed those bounds it is then oppressive usury, and “ though the municipal laws may give it impunity, they “ can never make it just.” In these cases most of the notes stipulate a premium at the rate of five per cent, a month; some at a less rate, some at a rate as high as ten per cent, a month, equal to one hundred and twenty per cent, per annum. I am constrained to say that the enormity of these rates must naturally excite an exclamation of astonishment, that they induce a presumption of unfairness ; they exceed any rational estimate of a fair equivalent for the use of money, and are greatly beyond any rates ever sanctioned by the principles of the Common ■Law. If they can be recovered, it must be by force of the •clear and express terms of the Statute, and only in such cases and for such term of time as come within its express provisions. To bring the contract within the operation of the first Section of the Statute, it is necessary that the premium should be “ fairly and bona fide stipulated and agreed upon by the parties to such contract,” and either in fact or in legal ■contemplation for the consideration mentioned in the •Statute. Had this been the first Statute in which the terms “ loan or use of money, wares, merchandize, or other commodity” were used in relation to interest or usury, or if a more enlarged construction of these terms than their literal import had not already been established, it might well be questioned whether by force of the first Section of the Act of 1818 an exorbitant rate of interest, even for the time while forbearance was agreed on, would be recoverable, unless it be in cases where it was specifically shewn by the written evidence of the contract to bo in consideration of the actual loan, use, or hire of the articles mentioned in the Statute. But the English Statutes of Henry 8th, of Eli. •zabeth, and of Ann ; Statutes of Virginia, of Georgia, and our own Act of 1805, all designed to prohibit usury and regulate the rate of interest, have used the same form of expression in describing the consideration of loans. If the Statutes of the other states of the Union on this subject were examined, the same form of expression would probably be found. In most of these Statutes other words are collaterally or incidentally introduced, such as. — 230 — “ for the forbearance or giving day of payment,” &c. and in their penal provisions the terms “ bargain, loan, exchange,” are usecf ‘ But as to the right to the interest on a loan, or stipulated forbearance of a debt, these latter clauses could, j apprehend, not be considered as enlarging the description of the contract. I will here observe, that most of these Statutes provide a rate of interest which shall be recoverable from and after the debts shall become due and payable. Our Statute of 1805, which was in force at the enactment of the Statute of 1818, was evidently intended to, include all contracts in which interest could be agreed for or usury committed. Yet as to the consideration during the time given for payment, the first Statute uses no language more comprehensive than the last; but it expressly provides that a certain rate of interest should be allowed and recovered for the time after the maturity of the debt. It is true, that the Act of 1805 in prescribing the remedy against usury says, “ if it shall be ascertained by the plea or answer of the “ defendant in any such suit that more than the rate of six “ dollars, &c. be taken or received in or by any bond or “ note whatever, for the payment of any principal or sum of “ money, goods, wares, merchandize, commodity, or other “ thing whatever bought or sold, no interest or premium “ whatever, for forbearance or giving day of payment, shall be allowed, &c.” This is the concluding sentence of the sanie Section which enumerates the subjects of the contracts by the use of the same terms which have been adopted for the like purpose in the Act of 1818 ; and if to be regarded in the construction of the first Statute, can only be considered as explanatory of the preceding sentence. It is also worthy of consideration, that the Act of 1819 now in force uses ■substantially the same language in defining the subjects of the contracts on which interest may be taken. My examination of this matter brings me to the conclusion, that by the uniform construction of the term “ loan of money, wares, merchandize, and other commodity,” as used in the Statutes of this and other countries to which I have referred, contracts on any valuable consideration for •the payment of money at a future day are included. The words “ or use” immediately following the word “ loan” in our Statute of 1818, have not been used in the other Statutes referred to. As here used they are perhaps insignificant; ■but at any rate they do not restrict the meaning of the sentence. If the construction uniformly given to the words “ for the loan of money, wares, merchandize, or other commodity,” prior to the Statute of 1818 was as I have stated, ■the same construction must be given to them as used in this — 231 — Statute. It is a rule of construction warranted by the best reason as well as highest authority, that “ words and phrases, “ the meaning of which in a Statute has been ascertained, “ are, when used in a subsequent Act, to be understood in “ the same sense.” It is also to be observed that in these notes a premium is stipulated which was allowable only under the Act of 1818 ; and from this it is fairly to be inferred that this-Act, and its application to the consideration of the contract, was in the contemplation of the parties wdien the contract was made. A debt payable at a future day always presupposes a loan; and “ if on a sale the purchase money is “ allowed to be retained by the vendee to be paid at a future “ time, a debt by that means is created, yet that debt arises “ from a supposed lending; if the transaction be analyzed, it “ will be found to bo compounded of two distinct contracts: “ first, a sale which contrary to the real fact supposes the “ purchase money to be paid; and then a loan by the vendor “ to the vendee, the debt is founded on the latter contract.” —Ord on Usury, 29. This principle no doubt had its influence in establishing the construction of the Statutes as I have stated. It is only by giving this latitude to the term “ loan,” that the maxim that “ there must be a loan to constitute usury” is verified ; but this liberal interpretation of the term does not extend its application beyond the period limited for forbearance, as I shall attempt in the sequel more fully to shew. If then an agreement to pay a debt in future presupposes a loan, or if the terms of this Statute require the same construction which have been uniformly given to the same terms used in other Statutes enacted for the regulation of contracts of the same description, the first Section of the Act of 1818 includes ordinary contracts for forbearance or giving day of payment; and it is not necessary that the specific consideration for the interest should appear either in the instrument or in the declaration. But admitting this principle, is the holder of a bond or note entitled to recover any rate of interest or premium stipulated therein, no matter how exorbitant it may be? Can he recover interest, for a period as to which there was no contract for a loan or forbearance ? That a premium thus agreed on, (no undue advantage appearing to have been taken) should be recoverable, appeal’s, I admit, plausible in theory ; and as a debtor is at liberty to pay the debt at any time after maturity, and stop the accumulation of interest, it may be said to be his own neglect or misfortune, and he must abide the consequences of his imprudent contract: but it must also be admitted that this doctrine is destructive in practice, and not recognized as applicable to many classes of contracts fully as explicit and much — 232 — Jess grievous than these ; as in deeds of mortgage, agree* ments for excessive damages, agreements in which there is miltua!ity or reciprocity, cases of gx-eat inadequacy of price, and many others^ Such contracts, in my conception, }lave a strong analogy to these now under consideration ; and the same inherent principles of justice and equity ought to govern them all. And if we attach to the term loan ” its most comprehensive signification, it can only apply tó a contract for the return or payment of money at a future day, or for the delivery of something for temporary use which is to be returned to the owner. “ Forbearance is the giving day for the “ return of a loan, or more properly signifies the giving a “ further day when the time originally agreed on is passed.” Ord, 23. Giving a further day for payment, to constitute-forbearance requires, I apprehend, not merely a passive indulgence, but an express agreement to that effect; and it is to be observed, that the term “ forbearance ” (could it enlarge the operation of this Statute is not to be found in it,) and is not omitted in any other on the same subject, yet I consider forbearance, when stipulated for, tantamount to a loan. By what authority then can we extend the operation of tho first Section of this Statute to an ordinary debt for which no forbearance has been agreed on -r or, if agreed for, how can the interest'for the time subsequent to the stipulated forbearance come within the scope of the first Section ? It is said that all debts carry interest after maturity at the same rate as before. For this principle, so far as it applies to a moderate and reasonable rate of interest, whether fixed by law or by the contract of the parties, the case reported in 4 Johnson’s Chancery Reports, 436, is an authority. In that case, the only objection was that the stipulated premium was too small.' The case cited from 2d Burrow', 1098, only proves that the lex loci governed the contract; but there is not the same authority for scrutinizing contracts in order to enhance as to reduce damages. In an action of debt or assumpsit, to increase the damages beyond the agreement would be unprecedented; yet it is the daily practice to reduce them. In cases like these, the reason for the difference must be obvious; for when or where were safeguards necessary to protect a lender from exaction ? When in a state of society like ours has it been unnecessary to provide checks for the protection of the borrower 1 He is generally at the mercy of the lender; tho lender never within his power or subject to his exactions. It is mainly for this reason that the Statutes, as well as the judicial deci — 233 — sions of almost every country have gone far to mitigate, but have never interfered to enhance premiums on money. But I have already said that in my opinion the Act of 1818 requires a strict construction. Will jt be deemed novel to maintain that a Statute under which for the detention of money- damages are claimed at a rate, five, nay more than ten times as great as has ever been prescribed by law, or assessed by a Jury in a well regulated community, demands a construction more cautious and strict than an ordinary Sta? tute designed to establish a moderate and uniform rate of interest ? Nor can I suppose it necessary at this day to offer argument or authority to prove that which in its nature and~ character, and according to settled legal principles, is a penalty, must not be so considered because it is called interest in the note. It is immaterial by what name the parties call it. The settled principles for the construction of cpn-iracts must determine its true character. Hen.cp I arrive at the conclusion that by the first Section of this Statute (in many respects peculiar in its phraseology) on the bonds or notes payable at a future day the high rates of interest or premium which were absolutely and unconditionally agreed upon, arc recoverable for the time of the loan or stipulated forbeai’ance. The Statute was evidently intended to give some latitude to contracts. As to the period of forbearance, the agreement to pay the premium is unequivocal and absolute, not dependant on failing to pay punctually at the appointed day, or on any other contipgen-gency. Thus far there was some degree of mutuality, inasmuch as the borrower had an indefeasible right to retain and use the money during the time of forbearance stipulated ; but beyond this time, according to my opinion, the exorbitant premiums do not come within the scope of the first Section ; and this equitable construction could have beén excluded only by an express provision of the Statute, that any conventional or stipulated rate of interest should continue to run until payment or judgment. The true spirit and design of the Act of 1818 were only to obviate the objection of usury to such contracts as, without the aid of this Statute, would have been considered as usurious ; and no other modification of the law: of contracts was intended to be made by it. Then if these contracts fully expressed the. intention of the parties, (and to claim the protection of the first Section they should be “ fairly and bona fide stipulated ” in writing,) under the old law such of them only would have been usurious as contain an unconditional agreement for the payment of the premiums for the stipulated time of forbear234 anee, or were payable on some probable contingency over which the debtor had no control. Under the old law, premiums payable only in the event of failing, to make pune-tual payment of the debt, as in the first class of these cases , or exorbitant premium or interest not to commence-running until after the expiration of the loan, as in the fourth class of cases, would not be considered usurious, yet could not be recovered because they are penalties. The debtors might make punctual payment. The legal presumption is,, that the contract will be complied with; and in that event the premiums would never attach. Hawk. P. 6, 245. Bac. Ab. Usury C. Although this Statute purports to sanction usury, I cannot for a moment suppose it was intended to coerce the recovery of penal obligations. The second and third classes of cases are not unlike the other two as to the premium or interest for the time subsequent to the day given for payment. The promise as to this time was not absolute and unequivocal, but depended on the contingency of failing to make punctual payment. It may be fair to presume the debtors contracted under a false confidence in their ability to be punctual, and did not expect to incur the penalty. Although the entii’e premiums in the 1st and 4th classes of cases depend on conditions expressed or implied, and in the 2d and 3d classes the interest subsequent to the maturity of the debt depends on the implied condition, yet as the creditors in justice, and by the principles of the Common Law, are entitled to reasonable interest for the detention of the debts ; if the conventional interest were moderate, equitable, and reasonable, it should, I think, be adjudged at the rates fixed by the contracts. But exorbitant as they hero are, they cannot be regarded as a measure of the damages for the detention of the debt for a longer period than was unequivocally contracted for; and' for the residue of the time I must look to the second Section of the Statute to ascertain the rate of interest which is to govern. In further elucidation of the doctrine I have advanced, suppose a chattel to be hired for a short time at a premium for each month equal to one fourth of its value. It is destroyed by negligence or misuser, and the hirer is unable to return it at the time appointed. The owner, several years afterwards, brings his action for the value of the property, together with the stipulated premium, amounting to more than ten times its value; could it be contended that by the express terms of this Statute, or by any principle of law or justice, he could recover according to this measure of damages ? If not, where is the distinction between the loan oi — 235 — hire of money, and of any other commodity ? The case supposed, as well as the cases before us, are stronger, but have a just analogy to-the case of Baxter and al. vs. Wates, 12 Mass. Rep. 366, where the borrower gave his promise in writing to return the animal hired in a. year, with $6 in cash, and if not then returned, to pay $6 for each year until delivered. It was held that the promisee was entitled to $6 for one.year only, and to legal interest afterwards; that the premium as stipulated for the time beyond the year was equivocal, unconscionable, and void. This decision was upon the principles of the common law, the contract being as much authorized by law as these now under consideration. In Reeves’ Domestic Relations, 423, 4, an analogous principle is recognized. It is there said that compound interest •appears to be fair, and may be taken annually; but if suffered to accumulate for several years will be denied both at law and in equity. In Jestons vs. Brook, Cowper, 795, the Court said, that admitting that there was no legal objection to the contract on the ground of usury, because the premium was contingent, yet by enforcing its stipulations the lender would receive an exorbitant premium on his money; therefore the consideration was adjudged inadequate, the bargain ¿unconscionable, and the premium was denied. By the case of the wire drawers, Cowper, 112, 116, which was also relied on in argument, the doctriné of relief, even in Courts of Jaw, against demands not usurious, but exorbitant, is well sustained. There the rate of premium was sanctioned by the common usages of the trade, and was moderate compared with these. Is a Court of law .competent to afford relief in the cases at bar ? The actions were all debt or assumpsit on’bonds or notes. By our Statute, Laws Ala. 464, it is provided that in all actions on “ penal bonds for the payment of money where- “ in the plaintiff shall recover, judgment shall be rendered “ for no moré than the principal and interest due on said bond.” This Statute requires the Courts of Common Law to reject the penal stipulations in the bonds. Assumpsit being in its nature an equitable action, the plaintiff is entitled to recover only so much as by the ties of natural equity and justice the defendant is bound to pay. Hence it would appear that in either form or for either cause of action the plaintiffs are not entitled to recover penalties or excessive damages, or exorbitant or unconsci-entious demands. In a question of this magnitude it is to be regretted that there could not be more unanimity in the Court; yet it is satisfactory to know that in the full Court now present -there — 236 — is but one dissenting opinion on a point which I think decisive of the main question of the principle, that these high ratCs of interest are not recoverable in any case for the time after the expiration of the stipulated forbearance. — ■ q'he nearest approach to unanimity is on the first class of cases, where the contracts stipulate a premium on the debt at the rate of five per cent, a month if not punctually paid. The opinion of five of the six members of the Court is, that this rate of premium shall be rejected as well for the time subsequent as for the time prior to the maturity of the debt We are brought to this conclusion by reasons somewhat, different, yet the effect is the same. — If we could give to a contract of this description the most liberal, and to the creditor the most favourable construction, and that which we should be constrained to give if there were no legal objection to the rate of interest, it would exhibit, when analyzed, an agreement on the part of the debtor to pay the principal on a given day ; and should he fail to do so, that ho would also pay interest thereon at this rate from the date to maturity, and at the same rate afterwards until the whole should be satisfied. If we reject the back interest as penalty on the ground of contingency merely, by what authority other than its exorbitancy, consideration, uncertainty, &c. (applying equally to the other classes of cases) do we reject the convéntional interest that would accrue subsequent to the maturity. It was no less the intention of the parties in the 1st class of contracts that the stipulated interest should run after tire maturity of the debts if not paid than in any of the other cases. My concurrence on this point is founded as to the back interest on the contingency, and as to the interest subsequent to maturity on the same reasons which govern my opinion in all the other cases ; that there was no loan, no agreement for forbearance, no sufficient mutuality or reciprocity; that the premiums were exorbitant, equivocal, and unconscionable, and do not come within the operation of the first Section of the Statute. The result of my opinion is, that in all cases where there is an unconditional agreement for the payment of the premium or interest at a stipulated rate, and prior to the maturity of the debt, it carries interest at that rate until maturity ; but that in all the cases interest for the time subsequent to the maturity of the debt is recoverable only at the rate .prescribed by the second Section of the Statute, eight per cent, per annum. Judge Crenshaw delivered his opinion on the points arising on the Record in the case of Henry and Winston vs. — 237 — Thompson. The principles of the opinion were equally to all the other cases. ' In this case, the declaration in substance states that on the 22d oí May, 1818, the defendants made and delivered to the plaintiff their note in writing for the payment of #625, 6 months after date, and if not punctually paid to carry per cent, a month interest until paid, for value received. The Circuit Court overruled the defendant’s demurrer to the declaration, and rendered judgment for the principal and interest thereon at the rate of five per cent, a month, from the date of the note until the time of the judgment. The defendants, (plaintiffs in Error) here assign as errors, 1st. That the declaration does not allege that the contract was made fairly and bona fide. 2d. The stipulation to pay 5 per cent, per month interest, if not punctually paid, was a. penalty, and the judgment should have been for the principal and interest at 8 per cent, per annum. By the Act of March, 1805, the rate of interest was fixed at 6 per cent, per annum; but by the Act of February, 1818, “ any rate of interest or premium, fairly and bona fide stipulated and agreed upon by the parties to such contract* “ expressed in writing and signed by the party to be charged therewith,” was made legal and recoverable ; and in all com tracts ascertaining the sum due when no specific rate of interest was expressed, it was to be recovered and allowed at the rate of 8 per cent, per annum — this contract was made while this Statute was in force, and its operation on the rights of the parties is now to be considered. As to the first assignment, if by the expression “ fairly and bona fide,” the Legislature intended to create any new right, or to superinduce any new quality of property, which was not essential to the validity of all contracts, then perhaps the omission of the averment might be fatal. When a new right unknown to the common law is given by Statute, k must be so averred in the declaration as to bring it within the meaning of the Statute. But by this expression the Legislature intended nothing more than what was an essential ingredient to the validity of every -contract, for no contract is good and effectual unless it be fairly and bona fide made, that is, with a full understanding of its subject matter, nature, and terms, without fraud, deceit, or circumvention on the one part, and with view of performing what is agreed to be done on the other. If these words were rejected from the Statute, the sense would still be the same ; they would be as strongly and necessarily implied as they are in all valid contracts. The express averment then that the — 238 — contract was fairly and bona fide made .was, in my opinion, no more necessary in this declaration than in a declaration on any 0t}jer contract. As to the other assignment, which is principally relied on, an(j jn discretion of which much ability and learning has been displayed by the eminent Counsel on both sides, it must depend on the sound construction of the Act of 1818. In my researches I have not been able to discover that any rate of interest was fixed by the common law; but in accordance with the principles of natural law the doctrine was, that if the compensation agreed to be given fot the use or hire of money was not beyond proportion to the risk of losing the sum lent, and the want and inconvenience occasioned by the loan, it was not malum in se, and was therefore lawful; but if it exceeded these bounds it was considered exorbitant and usurious. The first English Statute on the subject was that of Henry 8th, which confined the rate of interest to ten per cent. Out Statute of 1805 declared it unlawful to receive more than six per cent, per annum, but left the contract in other respects unimpaired. The principal was recoverable, and the interest alone was forfeited. But our Statute of 1818 repeated the prohibitory part of the former Statute, fixed the common standard at eight per cent., and declared lawful any rate óf interest or premium however exorbitant, or how much soever it might •exceed the common standard, provided it was expressly stipulated and agreed on in writing signed by the party to •be charged. Statutes should be expounded so as to effect the object intended by the Legislature. The manifest object •of the Legislature in the enactment of this Statute, was to remove some of the restrictions as to interest, and to permit the parties to agree on the rate by mutual consent, provided ■the rate so agreed upon was expressed in the contract, and that in writing signed by the party to be charged. From a careful examination of the Statute it will be seen that the primary object of the Legislature was not so much that the whole contradi should be in writing, as that the premium or rate of interest should be in writing; and that the only reason for requiring this to be in writing was that there might be no doubt or uncertainty as to the rate of interest agreed upon by the parties. I have already shewn, as I think, that it was not necessary to aver in the declaration that the contract "was fairly and bona fide made ; and the same reason more forcibly proves that it was not necessary to be so expressed on the face of the contract. The Court is not to require more to be in writing than is so expressly required by the Statute* It is not necessary that the consideration. — 239 — or that it was for the loan or use of money, áse. should be expressed in the contract, for this is not required by the Statute. By the second Section of the Act of 1818, where no specific premium or rate of interest is expressed, interest shall be recovered and allowed at the rate of eight per cent. per annum. This is a clear intimation that the parties shall be governed, by any rate of interest that is expressed in writing in any contract without regard to its nature or consideration. This Section, taken in connection with th'e first, and with the reference to the old law intended to be repealed, shews the intention of the Legislature to permit the parties, in all contracts which would carry interest by operation of law, to stipulate for their own rate of interest, either for the actual loan of money, or any commodity, a debt due, or any other consideration. I am therefore of opinion that it was not necessary that it should appear either on the face of the note or in the declaration that the contract was fair and bona fide, or for the loan or use of money or of any other commodity. Again, it has been contended on the one hand, that the agreement to pay interest at this rate was a penalty intended to secure and hasten the payment of the principal; while on the other it has been denominated damages stipulated by the parties to be paid if the principal should not be pune-, tually paid. I consider it perfectly immaterial whether it is penalty or stipulated damages. If it is such a contract as comes within the provisions of the first Section of the Act of 1818, any technical name by which it may be called cannot alter its nature or take it out of the Statute. It is yet a rate of interest stipulated and agreed upon by the parties. If the Statute had never existed, and the word “ interest” meant penalty, as it has been said, then it might be important to distinguish more precisely between penalty and sti-. pulated damages. The intention of the parties, as collected from the face of the instrument, ought to prevail. Men do not ordinarily use the word interest to convey the idea of a penalty. If a penalty were intended, why did not the parties use that word 1 Can it be supposed, that by fixing on a high rate of interest they did not intend that it, as well as the principal, should be paid ? As a penalty, it could answer no efficient purpose, and might as well have been omitted. Without it, the makers of the note would have been-bound topay the principal and interest at eight per cent. Were it material to distinguish between penalty and stipu-, lated damages, I know of no other rule for the distinction than the intention of the parties apparent on the face of the instrument. If it appear that they intended a penalty, the — 240 — Court should so consider' it; and if it appear that they in* tended stipulated damages, their intention must govern. It jlag j3een sajd. that this contract is unconscionable, and that the consideration is inadequate to support the promise. I am not ak}e t0 ascertain from the Record what was the value or proper rate for the hire of money at the time when the contract was made; for aught I know, it was worth the premium stipulated by the parties. The value of money fluctuates with the price of produce, and many other circumstances which affect the commercial world. Courts of Justice sometimes relieve against unconscionable contracts, and where the consideration is grossly inadequate ; but this is pn the supposition that fraud has been practised in obtaining the contract, as where a cunning, artful man has taken an unfair advantage of the weakness, ignorance, or extreme necessity of the other party ; but these circumstances arc to be considered as matters an pais, susceptible of proof, and not to be inferred moroly from. the seeming inadequacy of consideration as it appears on the face of the contract. As the case is now presented, I do not think that this Court has any thing to do with the conscientiousness of the com tract, or with the adequacy or inadequacy of its consideration. Our Statute is a peculiar one, and was certainly intended to admit men to agree on any rate of interest, how? pver enormous, without regard to the conscience of the parties or the adequacy of the consideration, provided they complied with the requisites of the Statute. ■ It is the duty \ pf Courts to give effect to the law according to the intention and meaning of the Legislature, and to give effect to contracts according to the intention and meaning of the parties. If this contract does not express a premium or I’ato of interest stipulated and agreed upon by the parties within the provisions of the Statute, I know not what words would constitute such agreement or stipulation. It appears to me a strange interpretation, to say that the parties, in expressing one thing meant another — that they did not mean interest, although that is the word used in the written instru-. ment. If they intended any thing else than the rate of interest agreed upon, why did they not sq express themselves in their contract .? I cannot explain away the law on the contract, because the law may be impolitic and the contract a hard one. If they are plain to my mind, it is not my duty to clothe their sense in mystery. In the construction of a law, a Court of Justice should never resort to its policy, unless when the law in itself is extremely doubtful. ' But the argument ol inconvenienti operates more in support of, than against this contract. It is convenient thvi — 241 — men should be held to their contracts, and extremely inconvenient that they should be impaired or rescinded. The spirit of the law is to uphold contracts, and presume in their favour until the contrary is made to appear. It is better to submit to an obnoxious law for a season, than to evade it by annuling contracts and prostrating the best principles of jurisprudence. The monster, with heart of flint and claws of iron, as the Counsel for the plaintiffs in Error in the glow of feeling and imagination have depicted the usurer, pad the sanction of the law for his actings and doings, and none but the Legislative authority is competent to alter the Jaw, In the cases to be settled by the present decision, some of the notes are drawn to carry interest from the date— some to carry interest from the date, if not punctually paid —some to bear interest without any reference to time— and some to carry interest from the time the note is due till paid. Nice distinctions have been made between these different classes of notes ; ■ some of them have been considered as coming within the provisions of the Statute, and .others not. In my opinion, it is immaterial what language the parties use in expressing the rate of interest; whether the instruments express that the interest is to run from the date or to commence at a future period — whether the agreement to pay interest be absolute, or dependant on failing to pay the principal when due. In all the cases, as appears to me, it is equally a rate of interest, stipulated and agreed upon by the parties, and completely within the spirit and meaning of the Statute. It is said that the Statute did not intend to make legal any contract which would have been usurious at common law. I am not certain that usury was an offence by the common law, at least the evidence of this is vague and indefinite, but admit that it was an offence clearly defined by the law. This Statute malms that lawful which by the common law was an offence. It makes any rate lawful which might be agreed upon by thé parties and expressed in writing. I regret that, without disregarding what I conceive to be the best rules of construction, and clearest principles of law, I could pot come to a different conclusion, for I am disposed to believe that these contracts may operate hardly if not oppressively; but it is not my province to legislate. In my judgment I am bound not to violate, but to declare what I believe to be the law. I cannot intrude on and assume the powers of another department of the government, whose acts and authority I am bound to respect and support. The — 242 — Legislature have already expressed their disapprobation of the Statute in question, by repealing it at their first Session its enactment. It is my duty to declare the law according to the best of my understanding; in doing which I am constrained to think that the judgments should be affirm-e(j . " 'As"to the case of Dinsmore vs. Hand, the note in that; case was treated as a sealed instrument, and was given pri- or to the Statute of 1818. The decision in that case does not, as I conceive, settle any of the principles involved in these cases. Judge Minor. These cases have collectively been brought before the Court under circumstances which appear to require my opinion on the principles involved. If it could influence the decision, it would of course not be applied to any of the cases in which I appeared as Counsel in the Courts below. As to the first class of cases — I will consider the points, as they arise in the Record, in the case of Harris and others vs. Morrow, This was an action of debt, on a bond of plaintiff’s to defendant in Error, dated 1st February, 1819, for payment of $125, one year after date ; and, if not then paid, to bear interest from the date at 25 per cent, per an-num. On the 28th March, 1821, the Circuit Court rendered final judgment by default, for the debt, and #67 70 as interest from the date. Is the agreement to pay interest from the date to be considered as a penalty ? It seems difficult to define the precise line of distinction between penalty and stipulated damages. The cases on this head do not appear to be reconcileable. In the case of Dinsmore vs. Hand, (a) which was debt on a sealed instrument payable at a future day, and if not punctually paid, to carry interest from the date, this court determined that the agreement to pay interest from the date was a penalty. I see no reason to disturb the principien of that decision. The Act of February, 1818, does not seem to me to affect this question. In Dinsmore vs. Hand, the rate of interest was, not beyond the limits fixed by law. The nature of the agreement, and not the form of the security, must determine whether it be penal or not. It seems to be immaterial whether the agreement be by a sealed or an unsealed instrument. 2 Bos. and P. 346—354. 2d Com. Con. 524, &c. An agreement to pay a larger, in order to secure a smaller, sum, must always be considered a penalty. Here the direct object of the parties was the payment of $125, one year after date. If the contract had been to pay $156 25 on the day after the bond became due in case of — 243 — tailing to pay at the day, there can be no doubt but the $156 25 must be considered as a penalty. Yet this would be the sum due on it if paid on the day after it became due, according to a literal construction of its terms. Contracts to increase the rate of interest in case of failing to pay at the appointed time, though the increased rate be within the limits fixed by law, appear to have been held to be penal. (b) It appears to me, then, that the agreement here to pay interest from the date is to be considered as a penalty, and not as a part of the contract, which expresses what was directly stipulated and agreed upon by the parties, and that 'there is no operative part of the contract bringing it within the scope of the 1st Section of the Act of 1818 ; that the interest must be recovered and allowed according to the 2d Section: and that the judgment should be reversed and rendered here accordingly. In considering the 2d, 3d, and 4th classes of cases, as arranged in the argument, it is necessary to enquire, to what description of contracts does the Act ■of 1818 extend ? Words and phrases, whose meaning in a Statute has been ascertained, when used in a subsequent Statute, are to be understood in the same sense. So words, whose meaning is well known at common law, when used in a Statute, are to be understood according to their ascertained meaning at common law. These are well settled, I may say, self-evident principles of construction. For the Legislature, when about to alter the law, must be presumed to consider the import and effect of the old law to be amended, and of tire new law to be enacted. The Act of February, 1818, was, as appears by its title, intended to amend the Act of 1805. In this Last mentioned Act, the contracts on which the rate of interest is fixed and restrained, are thus described: “ For the loan of any money, wares, merchandize, or other commodity.” In the several parts of this Act, the terms “ loan and forbearance” appear to be used as of the same import. So in the English Statutes, and those of the States of this Union which I have had an opportunity of examining, the term loan appears to bo always used as including all contracts in which the rate of interest was limited, and taking a higher rate made penal. See Stat. 37. H. 8, C. 9. 13 Eliz. C. 8. 21 Jac. I. C. 17. 12 Car. C. 13. 12 Ann, C. 16. Stat. of Virginia, 1 Hen. Stat. at large, 102. 1 Revised Code, 1819, 174. Law of Mass. 138. Laws N. C. Laws Ky. Laws of Ga. In the decisions on these Statutes it seems to have been uniformly held, that they extend to contracts for forbearance , or giving further day for the payment of pre-existing debts, as much as to contracts for loan, strictly speaking. In Ord on Usury, and the cases — 244 — there cited, it is said, “if there be a pre-existing debt, the “ forbearance of it may be usurious.' It is nothing more (S ^an lending the money for further time. So, if on a sale “ the money is retained by. the vender, it is a supposed lend- « jj^ subject to the laws against Uusury ” In 1 Vesey, p. 530, Ld. Commissioner Eyre says, “ Usury is taking more “ than the law allows for a loan, or, as I read it, the forbear- “ anee of a debt.” In Watkins vs. Taylor, 2d Munford, 428, the President of the Court says; “ an agreement for “ forbearance of a debt due, in consideration of receiving “ at a future day a higher premium or greater emolument “ thaii legal interest, is clearly usury.” "The judicial opinions given in 1 Hen. and Mun. 4—4. H. and M. 223, 4, 90. 2 Mun. 429. 4 Mun. 243—6. Cranch, 253, are to the same effect. By our Act of 1819, (Laws Ala. 444,) no person shall, upd'n any contract for the loan of any ihohey, &c., take abové the value of eight dollars for the forbearance of one hundred dollars, for one year; and all bonds, &c., on which a higher rate of interest is received or taken, shall be utterly void. I presume that it cannot be contended that this Statute does not render void bonds, &c., made after its enactment for pre-éxistihg debts; in which a higher rate of interest than eight per cent, per annum is stipulated, though not for a loan ; or that to bring a contract within the Act, the interest must actually be received. But the terms of the 1st Section of the Act of February, 1818, leave no room for doubt on my mind, as to the description of contracts to which it applies. Its title shews, that in its enactment, the Legislature had the Act of 1805 ip view ; and they have adopted terms to express their intention more comprehensive than those used in most of the Statutes to which I have referred. “ Any rate of interest “ or premium for the loan or use of money, wares, merchan- “ dize, or. other commodity,” &c., “ shall be legal and re- “ coverable.” Does not the forbearance óf a pre-existing debt give further use of the money ? Can any one read the sentence, and understand by it that the term use is applicable only to wares, merchandize, or other commodity, and not to money f — that what is here meant, is the loan of money, and the use of wares, merchandize, &c. ? — or that both the terms loan and use do not alike extend to all the enumerated subjects 1 By the 2d Section of the Act, “ on “ all contracts, written or verbal, where ho specific rate of “ interest or premium is expressed, interest shall be taken, “ recovered, and allowed, at the rate of eight per cent, per “ annum.” If it was the intention of the Legislatoe to confine the operation of the first Section within the limits now — 245 — contended for, why has it been declared in the second in such general terms that on all contracts where no specific rate of interest is expressed interest shall be recovered at the rate of eight per cent. ? If it was intended that a higher rate of interest should not be recovered on any contract for payment of money not founded on an actual loan, would not the second Section have expressed, in terms less doubtful, that on contracts ascertaining the sum due, and not being for money lent, &c. interest should be allowed at this rate ? Would not the subjects of the contracts on which any rate of interest to be agreed upon was made legal and recoverable, have been defined in terms very different from those used in the first Section ? The history of the country has been adverted to as aiding in the construction of this Statute. It has been said* that at the time of its enactment great encouragement was •offered for the loan of money - by the laws of the neighbour-ing States of Mississippi and Louisiana — that it was apprehended that if the restrictions imposed by the Act of 1805 were not removed, much of the monied capital of this State would leave it for a better market — that the rapidly advancing prosperity of the country afforded a prospect for the employment of money with great profit, and to the general benefit of the community — that the object of the Act of 1818 was to increase the facilities for borrowing money* and not to let creditors loose to contract for interest without limit on debts already due. From the same history, we learn that the opinion was about this time gaining ground that all laws limiting the rate of interest were impolitic, and tended to defeat tneir own object, to increase, instead of lessening the interest to be paid by those who wanted money. Whether this, as a general proposition, be correct or ■not, I ani not prepared to say. All must admit that this opinion, in producing the Act of 1818* was highly disastrous in its consequences to a considerable portion of the people of this State. The history of the country, as well as the title of the Act, induce me to think that the restraints imposed by the Act of 1805 on contracts for interest was the supposed mischief which the Act of 1818 was intended to remedy. . Why should the restrictions be removed in cases of loan only, and continued on all other contracts ? To one .disposed to give a high interest for money under an expectation of a greater profit from its use, or under the pressure of great necessity, it could make little difference whether the money was retained by a new contract with his creditor or borrowed of another; and had it been generally understood (as it is now said is to be understood from a proper construction of the Statute,) that a legal contract for a high246 ér rate of interest than eight per cent, could be made onk in consideration of an actual loan, it is obvious that the on-jy; or ¿¡le general effect of such a construction of the law on the community would have been to produce contracts for the loan of money to satisfy the pressing demands of creditors, instead of contracts with the creditors for further forbearance. But the tertns of the Statute seem to me to leave no room to resort to the supposed object of the Legislature in its enactment in order to give it a proper construction. It is said, that the right to make contracts of this description originates with the Statute. That the Statute requires the contract to be in writing, and that by analogy to the principles applicable to the Statute of Frauds, the consideration, being a part of the contract, must be expressed in writing. The Statute of Frauds requires that the agreements within its provisions shall be in writing,’and enacts that if not in writing no action shall be brought-on them. Our Statute of 1818, as I read it, requires that the rate of interest stipulated and agreed upon by the parties to the contract, shall be expressed in writing, and the writing signed by the party to be charged. The second Section of the Statute directs, that on all contracts where no specific rate of interest is ea:pressed, interest shall be allowed at eight per cent. Had it been the intention of the Legislature to confine contracts of this description to cases of loan, and to require that the consideration should be expressed' in the written contract, they could not have been at a loss for words to manifest such intention with clearness and precision. What matter or right has its origin in this Statute ? Not the right to contract for the payment of money, or for the payment of interest, but the right to contract for interest exceeding eight per cent, per annum. To recover interest exceeding this rate, it must be averred that the rate was expressed’in writing ; but I cannot perceive why it should be necessary that more than this should be so averred, for all the other matter of the contract is good without the aid of the Statute. 6 Bac. Ab. 383, 395. I am satisfied (by reasons which need not be here repeated,) that a contract for interest was good at common law. The Statutes on the subject have for the most part restrained and not given the right to make such contracts. That if the rate of interest be fairly and bona fide stipulated and agreed upon by the parties expressed in writing, and the writing signed by the party to be charged, the Statute makes it legal and recoverable, whether the consideration be a loan of money or other commodity, or the use of money by giving further forbearance for a pre-existing debt —this Court has heretofore decided (a) that the writing — 247 — which is the foundation of the action, whether it be under seal or not, must be received as evidence of the debt or duty ; and that it is not necessary to aver or prove the consideration. I have not been able -to perceive the force of the objection ’that by the Records it is not averred that the rate of interest was fairly and bona fide stipulated. Every contract is to be presumed to have been fair and bona fide until the contrary appear; to presume that it was obtained by fraud, or attended with other circumstances rendering it null, would at least be novel. Full effect will I think be given to these terms in the Statute, when we consider the strong and comprehensive terms by which any rate of interest is made legal and recoverable. I infer that the framers of the Statute, by requiring that the rate of interest should be fairly and bona fide stipulated, and that no bona fide contract should be vacated or in any manner impaired by reason of any premium or rate of interest, intended to obviate any doubts which might arise as to the power and control of Courts of Justice over contracts for interest which might not be fair and bona fide. And if this averment had been made in the declaration, I cannot perceive but that the same presumption must have attached to the contract, and the same and no greater range for defence have been left open to the other party as there would have been without it. It is said that for the time after the maturity of the notes which were payable at a future day, and in the cases in which the notes were payable at their dates, there is no contract for forbearance, and no consideration to support the agreement for the interest specified ; and that therefore the stipulated rate must govern only for the period of forbearance as expressed in the notes; and that from the time when they became due, the interest, according to the second Section of the Statute, must be at eight per cent, per an-num. If the parties had agreed for less than eight per cent., there could be little hesitation in concluding that the rate fixed by the contract must govern up to the time of the judgment ; and so I think it must here, as in all other cases where-the rate agreed docs not exceed the limits prescribed by law. 2 Burrow, 1098. 4 John. 436. It is further said, that these high rates of interest, from their very enormity, are to be considered but as penalty; and that this is more particularly the case as to the notes on which the stipulated interest was to run only from maturity, as in these it accrued only on the condition of failing to pay at maturity. .But if this renders it a penalty, interest on every debt to bo — 248 — pai(] at a future day is as much so, and the contract of the parties as to it must be disregarded; and yet the Statute uneqUivocally maltes the contract of the parties the standard. It is true these rates are enormous, very greatly be-y0n<j what any prudent man would contract for, and must naturally excite commiseration for the misfortunes and imprudence of those who made such contracts. Their hardship and oppression, and their ruinous consequences to a large portion of the community, have in the argument been spoken of with much feeling; but a Court of Justice is rer quired to enforce contracts, and not authorized to relieve the parties from the consequences of their own imprudence. It is the law and not the feelings or. wishes of those who may administer it which must govern. The questions presented by the Records lead not to the enquiry, whether there are any equitable circumstances entitling the plaintiffs in Error to relief, but to the examination of the legal construction of their contracts, These, ip all but the first class of cases, appear to me to be direct and unequivocal as to the rates of interest expressed; and it as clearly appears that the Statute authorized such contracts, and made them legal and recoverable, and that it is not “within the scope of judicial power to declare that they were illegal and shall not be recovered, In the duties which 1 have to perform here, I am required to be uninfluenced by sympathy for .any whom the ope? ration of the laws of the country has involved in distress; and according to the best lights I can obtain to express my opinion on the abstract propositions presented. I am of opinion, that all the contracts under consideration but those of the first class, are within the operation of the first Section of the Statute of February, 1818; that the parties were authorised to contract for interest at the rates expressed j that the interest so stipulated was made legal and recovera'; ble ; and that in the second, thir d, and fourth classes of cases, the judgments should be affirmed. Judges Ellis and Gayle concurred with the Chief Justice in the opinion that the Statute requires that the contract on its face should shew that the consideration was a loan. Judge Gayle also concurred with Judge Saffold in the opinion that where the rates of interest were exorbitant, and there was no time of forbearance fixed by the contracts, they were not within the operation of the first Section of the Act of 1818. As to this last matter Judge Ellis gave no opinion. . The written opinions of Judges Ellis and Gayle cannot now be found among the files of the Supreme Court, Footnotes [(a)] ante, p. 126. [(a)] ante, 126. [(b)] See 2d Vernon, 209—306. 3 Atk. 520. [(a)] Allen vs. Dickson, ante, 119.