Southern Home Building & Loan Ass'n v. Tony

Terral, J., delivered the opinion of the court. The appellee, Tony, a resident of Mississippi, borrowed of the appellant, a corporation of the State of Georgia, the sum of $2,000, and to secure its repayment, he executed a deed of trust on certain lands therein described, lying in Coahoma county, to a trustee, with power of sale if the contract was not promptly performed. The written contract between the parties specified that Tony should pay $12 monthly as stock dues, $10 monthly as interest, and $10 monthly as a premium on such advance. Tony having paid, as he alleges, more money than was necessary to satisfy his contract with the association, refused to pay more, and the association, through its trustee, being about to execute the power to sell said real estate, filed this injunction bill to perpetually restrain the trustee and his beneficiary from making said sale, and through this medium this equitable controversy is made in the chancery court of Coahoma county. The court referred the matter to the clerk of the court, as a special commissioner, to state an account be [920] tween the parties, directing him to charge Tony with the principal of the sum borrowed by him from the association, and with six per centum per annum interest thereon, and to credit him with all sums paid on account of stock, interest, or premiums, and to report the result to the court. From this order of the court the association appeals, and Tony takes a cross appeal. In Sokoloski’s case, 77 Miss., 155, the question was presented to this court whether a contract similar to the one shown in this case is usurious or not. In that case the question was argued upon both sides by able and distinguished lawyers, who left no resource of learning unexplored and no skill of argument untried. After mature and long-considered deliberation, we reached the conclusion that the taking of a monthly fixed premium, with a sum by way of interest, which aggregated an amount greater than the rate of interest that can be contracted for, is usurious ; that the amount contracted for as a premium, was in no sense a premium, as defined by the law books, but was a device to cover into the treasury of the association a sum by way of additional interest. We found the authorities in conflict on the question, but after full examination of them, we approved the principle announced in the Sokoloski case, and followed on that point the authorities there cited. Since the decision of that case, it has been strenuously assailed, but our confidence in its justice remains unshaken. 2. The further question is presented here, whether the borrower, Tony, in order to stop the sale of his land by the trustee, may do so in equity, except upon the terms of repaying the sum borrowed and legal interest thereon. Section 2318, code 1892, provides : “ And if a greater rate of interest than ten per centum shall be stipulated for or received in any case, all interest shall be forfeited, and may be recovered back, whether the contract be executed or executory^ ’ ’ . If this plain statute is to be construed according to its letter, we see no reason for requiring Tony to pay any part of the [921] usurious interest contracted for; for such effect would nullify the statute to that extent. It is undoubtedly a maxim in equity ‘4that he who seeks equity must do equity.” But can there be an equity in any person to receive that which the law forbids him to take ? If a person pays usurious interest, it is clear that he may recover the whole at law, because the statute secures that right to him. Now, if the contract be exigible in pais, why may not the collection of the usurious interest be stopped by the intervention of the chancery court % As a party in this latter case can have no redress except in an equity court, he would be without a remedy for a clear right unless that court gives him its assistance. For his right not to have this usury collected of him is as clear and as strong as his right to recover the same when paid. And because a deed of trust is exigible in pais by the party himself, and the remedy at law was to suffer its collection and then sue for its return, after, perhaps, his property has been sacrificed by reason of its sale for the payment of usury, the .court, in Parchman v. McKinney, 12 Smed. & M., 631, held that he might go into equity and stop the sale to the extent of the usury demanded. Parchman v. McKinney is fully supported by Long v. McGregor, 65 Miss., 70. When the case was first submitted to us we were inclined to think that Mortgage Co. v. Jefferson, 69 Miss., 770, was intended to overrule Parchman v. McKinney, but a more extended consideration induces us to think we misunderstood the argument of the learned judge. The doctrine of Parchman v. McKinney authorizes Tony, as we think, in claiming exemption from paying any part of the interest contracted for. It results from this view that the court erred in requiring Tony to be charged upon his debt to the Southern Building & Loan Association, with six per centum per annum interest. Remanded.