Gill v. Rice

By the Court, DixoN, O. J. If this were a legal instead of an equitable action, there can be no doubt that we should be [553] obliged to reverse tbe judgment and award a new trial for errors occurring in tbe instructions of tbe judge to tbe But as it is a purely equitable proceeding, in wbicb we must review tbe facts as well as the law, and as tbe proofs taken are all reported in tbe bill of exceptions, it must be determined according to tbe law and equity of tbe case as they appear to us from tbe testimony taken. Tbe court below, somewhat irregularly as we think, referred tbe whole issue to tbe decision of a jury. Such issues are properly no more triable by a jury now, than they were before tbe adoption of tbe Code. And although specific questions of fact arising in them, may now, as before, be sent to a jury, yet tbe finding of a jury is not now, any more than it was then, conclusive upon tbe court. Tbe duty still devolves upon tbe court to determine tbe case according to its convictions of tbe law and tbe facts. We must so decide tbe present case, and if by so doing it appears that- tbe errors committed in tbe charge do not affect tbe final result, they must be disregarded. It is clear that tbe court was wrong in refusing tbe third instruction asked by tbe counsel for tbe appellant, that a general payment by a debtor to a creditor, without any application by tbe former, should be applied to demands not forbidden by statute, and that if such payment were made, tbe creditor would have no right to apply it upon usurious interest. Tbe contract to pay usury being void, it could not constitute an indebtedness to wbicb tbe creditor could apply tbe payment. Tbe same is true of tbe refusal to give tbe fourth instruction asked by tbe same counsel. Tbe law in such cases will apply a payment upon a usurious contract, when no directions are given by tbe debtor, to tbe extin-guishment of tbe principal sum loaned, when by law such sum can be collected. Tbe judge was likewise ,wrong in charging tbe jury that tbe appellant could not avail himself of tbe statute against usury, until he bad first paid or tendered tbe whole amount of tbe principal sum loaned. It has frequently been decided by this court that since tbe repeal of chapter 55, Laws of 1856, by chapter 160, Laws of 1859, no payment or tender of tbe principal sum loaned was necessary. Root vs. Pinney [11 Wis., 83], and Wood vs. Lake [554] \.an^ P- 84]. He also erred in instructing tbem that if no application was made by the debtor, it was competent for the creditor to apply the payment to the usurious interest contracted to be paid. The reason for this has already been given. And even if such application had been made with the assent and by the direction of the debtor himself, he would still be at liberty to repudiate it, and have the money applied in payment of the principal sum loaned. See Wood vs. Lake, supra, and cases there cited. But notwithstanding these errors, there is one feature of the transaction which we think is decisive of the merits of the controversy between these parties. It is the estoppel which was created by the declarations of the appellant to the respondent, made before the latter consummated the trade with Gibson for the note and mortgage in question. It conclusively appears from the evidence of the respondent and three other witnesses, who are uncontradicted, and whose testimony is in part corroborated by that of the appellant himself, that the respondent purchased the note and mortgage of the mortgagee, Gibson, without notice of the usurious taint or agreement, and that he paid therefor a full and valuable consideration; that he took them at first upon condition, and with the privilege of returning them, if it should be ascertained that they were in any way defective; and that whilst he so held them, he applied to the appellant, who informed him that there was $100 or over due upon them, being the sum then and now claimed to be due, with the interest, and that he should pay it as soon as he received some money which was due him from others. The appellant soon after completed the trade, and took the note and mortgage absolutely. It cannot be questioned that under the circumstances this admission constituted a perfect estoppel in pais against the appellant, and that he cannot be permitted to retract it against the respondent. The only difficulty arises from the imperfect and inconsistent averments of the answer. It is evident from the answer that the pleader relied upon and intended to set up the facts showing the estoppel, but in doing that, he has so framed his allegations that, strictly construed, they show that there was no estoppel. The evi [555] dence was for tbis reason objected and excepted to by tbe appellant. Tbe court, acting without doubt on tbe intention of tbe pleader, and tbe fact tbat it was not claimed tbat tbe appellant was surprised, admitted it, probably on tbe ground tbat tbe variance was immaterial. Tbe statute (sections 33 and 34, chapter 125) goes a great ways in removing such objections, where it is not made to appear tbat tbe adverse party is misled, and confers a large discretion on tbe courts in directing tbe facts to be found in accordance with tbe evidence, or in amending the pleadings so as to conform them to tbe proofs made. But we think it would be going too far in tbis case, to disregard tbe variance and say tbat tbe judgment should stand, without an amendment of tbe answer according to tbe facts éstablished. Tbe judge should have ordered tbis to be done upon tbe trial. But since it is not pretended that tbe appellant was taken by surprise, or tbat tbe action was not, in tbis respect, fairly tried on its merits, we shall not, because of such omission, reverse tbe judgment, which upon tbe whole case is right and should be sustained. We shall affirm it, and direct tbe cause to be remanded, and tbat tbe answer be amended according to tbe facts proved. 1 Tbe position of tbe defendant’s counsel, tbat tbe variance may be disregarded because an estoppel in pais need not be pleaded, is incorrect. It was true; at tbe common law (8 Wend., 483), but is not now. The Code requires the facts constituting tbe cause of action or ground of defense, whatever they may be, to be succinctly and clearly stated in tbe pleadings. Ordered accordingly.