Searles v. Lum

GOODE, J. Prior to 1893, tbe’respondent was a cotton dealer in Vicksburg, Mississippi, and tbe appetent was one of bis patrons. Respondent sold out bis business to bis brother and left Vicksburg. Before be left, tbe appellant, who bad known bim from boyhood and bad been one of bis schoolmates, said to bim that be might want a line of credit with bis brother, with whom be was not so well acquainted and requested tbe respondent to guarantee bis account. Searles •agreed to do this. Tbe result was be was called on in tbe course of a few months to make good an indebtedness tbe appellant owed to tbe amount of $596. Tbe respondent was in Chicago at that time, but visited Vicksburg shortly afterwards and asked Lum to reimburse bim. Lum made difficulties about it and complained be bad been misused. Tbe two then agreed to submit tbe entire dispute to impartial arbitrators. Searles selected one, Lum another, and those two a third. Tbe arbitrators beard tbe statements of tbe parties and returned an award in writing which found that Lum owed Searles $507.21. Thereupon, Lum said be hadn’t tbe money to settle with at tbe time and requested thirty days indulgence, promising to remit to Searles at Chicago. Tbe latter assented; tbe money [239] was never paid and this action was on the award to recover it. This is the second appeal. The defense of the statute of limitations, the 'conclusiveness of the award as to all matters within the scope of submission and that the submission was sufficient for a common-law arbitration, were adjudicated adversely to the defendant and are now the law of the case. It was held that all matters of dispute between the parties which were submitted to the arbitrators were merged in their decision. One point is raised which was not considered when the case was in this court before; namely, that the money paid by the plaintiff was to discharge debts incurred by the defendant in option deals which were unlawful by the statute of Mississippi. That statute is as follows: “A contract for the purchase or sale of a commodity of any kind, to be delivered at a future day, the parties not intending that the commodity is to be actually delivered in kind and the price paid, shall not be enforced by any court; nor shall any contract of the kind commonly called ‘futures’ be enforced, nor shall a contract in’this section mentioned be a valid consideration, in whole or in part, for any promises or undertaking.” The precise error complained of is that the trial court excluded evidence offered by the defendant tending to prove that the indebtedness grew out of transactions of that kind and that the plaintiff was aware of the fact when he advanced the money to pay it. It is claimed by the appellant that demands founded on illegal acts are not properly subject to arbitration and that an award on an unlawful contract is void. If this be allowed, it by no means follows that the court erred in its rulings. In the absence of a restrictive statute, money loaned to pay either gambling debts or those created by prohibited business transactions may be recovered when the loan was not a mere device or makeshift tu cover the lender’s participation in [240] tbe affair. This is particularly true when the money is advanced after the affair is over and not for the purpose of enabling the borrower to engage in it. Faikney v. Reynous, 4 Burr. 2069 ; Steers v. Lashley, 6 Term. R. 61; Ex parte Pyke, H. Ch. D. 754; Armstrong v. Bank, 133 U. S. 433; English v. Young, 10 B. Mon. (Ky.) 141; White v. Wilson, 37 S. W. 677; Wyman v. Fiske, 3 Allen 238, 80 Am. Dec. 66; Ballard v. Greene, 118 N. C. 390; Hoyt v. Cross, 108 N. Y. 76; Tyler v. Carlyle, 79 Me. 210; McGabock v. Puryear, 6 Coldw. (Tenn.) 34; Waugh v. Beck, 114 Pa. St. 422; Roberts v. Blair, 11 Colo. 64; Cannon v. Bryce, 3 B. & Ald. 179. It may be different when the money is lent in the first place with a definite understanding that it is to be used in gaming or unlawful trades. No statute of Mississippi was introduced which is material to the issues except the foregoing. It clearly does not preclude the recovery of the money advanced by the plaintiff at defendants’s request either by express words or for reasons of public policy. At common law the debt is undoubtedly collectible, and in the absence of proof or a statute changing the rule, the case is governed by it. This defense being out of the way, there was nothing to hinder plaintiff’s recovery, because all other questions were res judicata. The judgment is affirmed. All concur; Bland, P. J., in a separate opinion.