This proceeding was instituted in the Circuit Court for Howard County, sitting in equity, to foreclose a mortgage dated the 10th day of March, 1871, to secure a loan of $11,000, and executed by William Davis and others, defendants, to Caroline E. Parks, of the State of New York, executrix *Page 85 of Charles E. Parks, the predecessor in the trust, of the appellants.
The defendants answered the bill and on the 20th of February, 1900, upon the written assent of the defendants, a decree was passed directing the mortgaged property to be sold, and the money arising on the sale to be brought into and to be distributed under the direction of the Court. The property sold for the sum of twelve thousand and fifty dollars, and the sale was duly ratified on the 15th of September, 1902. There were two audits filed in the case. The first was stated according to the contention of the appellants, and showed a deficit of $2,023.86, due the trustees, after applying the proceeds of sale, and the allowances for costs and expenses of sale. On the 14th of May, 1901, the appellee, Wm. Davis, filed exceptions to the first audit, stating that the charge of interest at the rate of seven per cent, as set forth in the mortgage is usurious, and having paid interest on the mortgage at the rate of seven per cent for ten years, he is entitled to have the payments made by him in excess of the legal rate of interest, according to the law of Maryland, credited as of the time of the payment upon the principal of the mortgage debt. An answer was filed by the appellants to these exceptions, in which among other things the defense was relied upon, "that the mortgage notes in the case being contracts intended by the parties thereto to be executed and performed in the State of New York, their validity as regards the rate of interest to be paid must be determined by the laws of the State of New York in force at the time the notes were made, and that the legal rate of interest in the State of New York at that time was seven per cent per annum." On the 8th day of April, 1902, the exceptions filed to the ratification of the auditor's account by the appellee were sustained and a new account was directed to be made. On the 28th day of June, 1902, the exceptions to the second audit were overruled and the account having been finally ratified and confirmed this appeal has been taken.
There can be no question that under the evidence disclosed by the record that the contract sought to be enforced in this *Page 86 case, is a Maryland contract and must therefore be construed according to our Maryland law. The original agreement for the sale of the property which is located in Howard County, Maryland, and which is signed by a Maryland agent is to the following effect:
Jany. 10th, 1871.
"Received from William Davis and Samuel E. Davis the sum of one hundred dollars being so much paid on account of the purchase of the village of Marriottsville containing about 207 acres of land in fee-simple except one lot subject to ground rent of thirty dollars a year; which I as agent of Robert Seaman have sold to the said William and Samuel E. Davis for the sum of twenty thousand dollars ($20,000) payable as follows: Nine thousand dollars ($9,000) in cash when the title has been examined and found good for which a reasonable time is hereby granted, the balance to be paid with interest at seven per cent at any time within five years, and in such sums not less than $2,500 at one payment at the pleasure of the purchaser, interest payable yearly — taxes and ground rent to be paid by said Seaman up to the date of sale.
"Deed to be given on payment of the cash payment of nine thousand dollars (and a mortgage to be then executed by the purchasers to the said Robert Seaman for the credit payment or the mortgage shall be made to such person or persons as said Seaman shall direct.) M. Bannon."
It further appears that the mortgage which was given for the debt and interest, was executed in Baltimore City and the affidavit was made by Mr. M. Bannon, the agent, at the same place. The principal note is dated Howard County, Md., and the notes, which were given to cover the annual interest on the principal debt, bear the same date.
It is well settled that in the absence of proof to the contrary, the presumption is that a note is payable at the place where it is dated. Ricketts, c., v. Pendleton, 14 Md. 321;Boyd v. McCann, 10 Md. 118. The contract that is sought to be enforced in this case being then a Maryland contract, and it being conceded that the appellee paid interest on the principal debt at the rate of seven per cent per annum, he is clearly entitled to have the payments in excess of six per cent the legal rate of interest, as established by the law of this State, credited upon the mortgage debt. *Page 87
But it is contended, that the appellee waived the right to set up the defense of usury by his answer to the bill consenting to a decree for a sale of the property, and is thereby estopped from urging it here. It appears, however, from an examination of the decree that it in no way settled or decided the amount to be paid or the amount that was due upon the mortgage debt. The decree simply directed, that the property be sold and the trustees bring into the Court the money arising from the sale, to be distributed under the direction of the Court. In the case of Woods v.Matchett, Admx., 47 Md. 395, it is distinctly said: "The Code provides, it is true, the mode and manner in which a defendant may plead usury, but its provisions do not in any manner deprive him of the then existing remedies for relief against the payment of illegal interest, even though he may have failed to avail himself of the plea. Art. 95, Code, secs. 4 and 5. It is well settled in this State that a Court of equity will grant relief against the payment of usurious interest, even after judgment, and further than this, that an action at law would lie prior to the Act of 1876, to recover excessive interest actually paid.Hitch v. Fenby, 6 Md. 218; West v. Beans, 3 H. J. 568;Goldsmith v. Tilly, 1 H. J. 361; Scott v. Leary,34 Md. 389; Bandel v. Isaac, 13 Md. 202."
Finding no error in the order of Court appealed from, it will be affirmed.
Order affirmed with costs.
(Decided December 4th, 1902.) *Page 88