Ford v. Vicksburg Waterworks Co.

Smith, C. J., delivered the opinion of the court. Appellee is a waterworks company, eng’aged in supplying water to the citizens of the city of Vicksburg, and one of the rules adopted by it for the conduct of its business provides that all water bills are payable at the office of the company on the 1st day of the month following that in which the service is rendered and, if not paid on or before the tenth day thereafter, ten per cent of the amount thereof will be added thereto. Appellant being-in arrears in his account with appellee for water furnished him, this suit was instituted to enforce the payment thereof. His complaint here is that the court below rendered a judgment for appellee, not only for the amount actually due it for water furnished him, but also added to this amount, in addition to legal interest thereon, ten per cent thereof, in accordance with appellee’s rule herein-before referred to. This adding of ten per cent thereof to consumers’ bills provided for by appellee’s rule is no part of the money due it for water furnished, but is simply a penalty, arbitrarily imposed by it, either for the purpose of enforcing the prompt payment of consumers’ bills, or to indemnify it for'any damage it may suffer by reason of these bills not being promptly paid. In either event, appellee’s claim therefor should not have been allowed. It has not been empowered by law to im pose upon and collect from its debtors fines for not paying their accounts promptly, and the only damage which the law contemplates that a creditor will suffer by reason of the mere withholding of money due him is legal interest thereon. The measure of all such damages is legal interest. . [725] Appellant also claims that this attempt of appellee to collect this penalty constitutes a violation of section 2678 of the Code, and therefore it must forfeit all interest on the account. In this appellant is in error. The penalty of forfeiture imposed by this section of the Code covers only two classes of cases: First, where parties contract for a rate of interest in excess of that allowed by law; and, second, where the creditor receives a rate of interest greater than that allowed by law. The case at bar falls within neither of these classes. The right of appellee to impose and collect this penalty is not res adjudicate by reason of anything contained in the decree of the United States Court for the Western Division of the Southern District of Mississippi, rendered in the case of Mayor and Aldermen of the City of Vicksburg v. Vicksburg Waterworks Co., a copy of which appears as an exhibit to the testimony of the witness Crumpler. See 206 U. S. 496, 27 Sup. Ct. 762, 51 L. Ed. 1155. The judgment of the court below is reversed, and judgment here for only the amount due appellee for water furnished, together with legal interest. Reversed.