Turner v. B. & L. Ass'n

Mr. Chief Justice McIver,

dissenting. While I agree with the view taken by Mr. Justice Gary, as to the first ground of the demurrer, and do not deem it necessary to add anything to what he has said on that point, I cannot concur with him in the view which he has taken as to the second ground of the demurrer. On the contrary, I agree with the Circuit Judge as to that point. The rights growing out of usury, in a contract brought before the Court for adjudication, are solely the creatures of statute, which, in my judgment, were enacted solely for the benefit of borrowers, and were designed to protect that unfortunate class of persons from the greed and extortion of the money lender, who might, otherwise, be tempted to impose upon the necessities of the borrower. Hence, I do not think the plaintiffs, who cannot, in any sense, be regarded as borrowers, can be permitted to avail themselves of any rights conferred by special statutory provisions upon a class of persons to which they do not belong. Hence, while Mrs. Jones, who was, unquestionably, the borrower of the money, might, if she had been required to pay more than lawful interest on the money which she borrowed, have maintained an action like this to recover back double the sum which she had paid in excess of the lawful interest, I am unable to perceive how these plaintiffs, who voluntarily assumed the payment of an obligation incurred by Mrs. Jones, which, as we have seen, was not, on its face, tainted with usury, can maintain any such action. These views I find fully supported by authority. In 2 Pom. Eq. Jur., *408sec. 937, the rule is laid down in the following language, and supported by numerous cases cited in the notes: “Since the illegality of usury is wholly the creature of legislation, the provision of the statute must furnish the rule determining the extent, limits, and occasion of relief. It results from a just interpretation of the legislation that the right to complain is a personal one, belonging only to the borrower and his representatives; no other party is entitled to relief, defensive or affirmative. The doctrine is, therefore, generally settled, that where land subject to a usurious mortgage is conveyed to. a grantee, who assumes the payment thereof as a part of the consideration of the conveyance, he can not set up the usury either as a defense to a foreclosure or as a ground for a cancellation of the security. The same is true of any transferee of property, who, as a part of the transaction, assumes payment of a usurious debt.” One of the cases cited to sustain this doctrine is DeWolf v. Johnson, 10 Wheat., 367, where it was held by the Supreme Court of the United States, that the assignee of an equity of redemption can not allege usury in the loan to the mortgagor to defeat a foreclosure by the mortgagee; and this was upon the ground that the plea of usury was personal to the borrower. So in 27 Am. & Eng. Ency. of Law, at page 949, I find the following language: “It is settled by a multitude of decisions, that the right to plead usury is a privilege personal to the debtor. The defense has been compared to that of infancy.” And, again at page 956'of the same volume, it is said: “If a third person, either for accommodation or in payment of his own debt, contracts to pay the usurious debt of another, he cannot avoid the contract on the ground of such usury.” This doctrine has been distinctly recognized by this Court, as may be seeu by reference to the case of Jeffries v. Allen, 29 S. C., at page 508, where the late Chief Justice Simpson, in delivering the opinion of the Court, used this language: “It seems to be the law, as a general rule, that no one but the borrower, his sureties, heirs, devisees or personal representatives, can *409Set up the plea of usury. See Tyler on Usury, and the numerous cases which he cites in his chapter on the defense of usury, page 403, et seq.” Accordingly in that case Mrs. Allen was denied the right to set up the usury claimed, upon the ground that she was not the borrower.

It is contended, however, by the plaintiffs, that they having paid more than the amount actually due on the bond of Mrs. Jones, they are entitled, without reference to the usury laws, to recover back the amount so overpaid. A sufficient answer to this position is that no such question, so far as the “Case” shows, was ever presented to the Circuit Judge, and certainly no such point was considered or passed upon in his decree, a cop3' of which is set out in the “Case;” and under the well settled rule, no such point can be considered here. Besides, it is very obvious that there is nothing in the complaint upon which to base any such position. The allegation in the fourth paragraph of the complaint, “that the legal amount due upon said bond and mortgage” was much less than the amount exacted by defendant, is a mere assertion of a legal conclusion and not the allegation of an3>- fact, which aloné can be considered under a demurrer. There is no allegation that anything more than the stipulated interest — -six per cent.' — -had been paid as interest, and what amount, if any, had been paid on the principal, is left wholly uncertain; for it certainly cannot be claimed that the whole amount paid as monthly instalments on the stock would operate as payments on the bond. Surely a part, at least, of those payments would justly go towards the expenses incident to the business of the company, and making-good any losses that may have been incurred. Indeed, I do not see how it would be possible to ascertain the amount with which the bond should be credited at the date of the settlement, except by ascertaining the value of the stock at that time, and crediting the amount so ascertained on the bond. To do this would require the allegation of facts, which I do not find mentioned or alluded to in the complaint. It seems to me, therefore, that even if the point *410raised by plaintiffs’ fourth exception were properly before us, it could not be sustained.

While, therefore, I think the Circuit Judge erred in overruling the first ground of the demurrer, yet, as there was no error in sustaining the demurrer on the second ground, the judgment of this Court should be that the judgment of the Circuit Court be affirmed.