Rozelle v. Dickerson

Cooper, C. J., delivered the opinion of the court. It is unnecessary to pass upon the correctness of the action of the court below upon the numerous exceptions taken to the testimony, since it is manifest that the facts found by the Chancellor are established by the evidence in the record, and in any view of the case must determine the respective rights of the parties and control the decision. The contention by the appellants that the mortgage cannot be enforced for any part of the debt existing prior to the adoption of the Code of 1880, because Mrs. Rozelle, being a married woman, was under no liability to pay it, and that for this reason it cannot form a sufficient consideration for a new promise, made after the adoption of the code, is not maintainable. It is true that the note of March 2, 1880, was not enforceable against her personally, but it Avas the debt of her husband, at least, and the mortgage executed by, her to secure its payment bound the rents and profits of her estate mortgaged, and this liability of her estate Avas sufficient to support the neAV arrangement entered into on March 2, 1882, at which time she was relieved of all disability of coverture. [545] By including in the note interest at the rate of ten per cent., the payee “ stipulated ” for a greater rate than was permitted by law, and the consequence declared is a forfeiture of all interest. As we have heretofore held, any stipulation, however and whenever made, whether evidenced by a writing or proved by oral evidence, infects the contract to which it refers and brings it within the condemnation of the statute, by the terms of which it is converted into a fruitless and unprofitable transaction-. The purpose of the statute is to discourage exorbitance, and this it does by declaring a forfeiture of “ all interest ” “ in any case ” in which a greater rate than ten per cent, is stipulated for. The forfeiture is not of all interest for the time during which the unlawful rate is stipulated for, but it extends throughout, is co-extensive with the contract of which it is originally or is subsequently made a part, and unless a new and express agreement is made for future legal interest, none can be thereafter collected. It was, therefore, error to allow interest after the expiration of the time for which, by express agreement, usury was reserved ; no interest should have been permitted after the making of the unlawful contract. For this error the decree will be reversed and a proper decree made here. The decree' sustaining the demurrer to so much of the bill as sought to recoup against the note unliquidated damages for the breach of an- independent contract was manifestly right. Decree reversed.