Weiss and Hamilton v. Gumbert

On Rehearing

*140Coan, Rosenberg & Swire, of Portland, for the petition. TOOZE, J.

On Petition for Rehearing.

On appeal herein, this court reversed the trial court and remanded the cause with directions to the court to enter judgment for plaintiffs David M. Weiss and Ed Hamilton against defendant Eva M. Gumbert, as executrix of the estate of Milton L. Gumbert, deceased, in the sum of $10,000, with interest thereon at the rate of 6 per cent per annum from May 15, 1947, until paid. Weiss and Hamilton v. Gumbert, 52 Or. Ad. Sh., 221.

Defendant has filed a petition for rehearing alleging this court erred in holding that plaintiffs were entitled to recover interest, claiming such holding is contrary to the previous decisions of the court in Copeland v. Tweedle, 61 Or. 303, 122 P. 302, and Boyer et al. v. Edgemont Investment Co., 135 Or. 161, 295 P. 471.

The principal sum of $10,000 involved herein represented a deposit made by plaintiffs on March 28, 1947, as a part of a written offer of purchase of the Gumbert fur store located in Portland.

Plaintiffs rescinded this offer on May 14, 1947, and on that day demanded in writing a return of the deposit. Defendant refused to return the money, and this action was commenced by plaintiffs to recover the same, with interest thereon at the rate of 6 per cent per annum from May 15,1947.

On the appeal to this court, we held that plaintiffs had the right to rescind the transaction and were entitled, upon such rescission, to a return of their deposit of $10,000.

*141Section 66-101, O.C.L.A. (as amended by Or. Laws, 1917, ch. 358, § 1) in part provides:

“The rate of interest in this state shall be six per centum per annum and no more, and shall be payable in the following cases, to wit:
“ (1) On all moneys after the same becomes due; provided, that open accounts shall bear interest from the date of the last item thereof.
“ (2) On judgments and decrees for the payment of money from the date of the entry thereof unless some other date is specified in said judgment or decree.” (Italics ours.)

In Copeland v. Tweedle, supra, it appears that plaintiff had taken a conveyance from defendants of certain timber land in Clatsop county, paying therefor $3,900. She rescinded on the ground of fraud and demanded a return of the $3,900, tendering defendants a deed of reconveyance. The trial court found for plaintiff and entered a decree canceling the conveyance from defendants and allowing a recovery by plaintiff of the sum of $3,900, with interest at the rate of 6 per cent per annum from the date of the original conveyance. On appeal to this court, we held that “prior to decree, the case presents no situation allowing interest within the meaning of § 6028, L.O.L.” This decision was rendered in March, 1912.

Section 6028, L. O. L., in part provided:

“The rate of interest in this state shall be six per centum per annum, and no more, on all moneys after the same becomes due; on judgments and decrees for the payment of money; on money received to the use of another and retained * * * .”

In Sargent v. American Bank and Trust Co., 80 Or. 16, 40, 154 P. 759, 156 P. 431, Mr. Justice Harris, *142on rehearing, traced the history of this interest statute and discovered that in the original draft of the act as filed in the office of the Secretary of State there was a comma (,) instead of a semicolon (;) after the words “on all moneys after the same becomes due,” thereby clearly indicating that the words “on all moneys after the same becomes due” referred to moneys becoming due “on judgments and decrees.”

Because of this, Copeland v. Tweedle was correctly decided. But in 1917, following the decision in Sargent v. American Bank and Trust Co., supra, the legislature amended this statute as above noted.

In April, 1923, the statute as amended again came before this court for consideration. In Gellert v. Bank of California, National Association, et al., 107 Or. 162, 178, 214 P. 377, it was contended that when the right to recover money is in good faith denied, interest will not be allowed on the demand prior to liquidation by judgment. In rejecting this contention, Mr. Justice Harris, speaking for the court, said:

“The amount for which the plaintiff sued was a definite and certain sum. The plaintiff was entitled to recover either the whole amount of each draft or nothing. The amount became due before judgment. By the plain terms of Section 7988, Or. L., as it now reads after amendment, interest ‘shall be payable * * * on all moneys after same becomes due. ’ Interest was properly included in the judgment.”

In the Gellert case, plaintiff had tendered the drafts to the bank for cancellation and demanded a return of the money paid for them on June 2, 1920. The judgment in favor of plaintiff included interest from June 2, 1920, the date of the demand and defendant’s refusal to pay.

*143In the ease at bar, the $10,000 deposit involved was a fixed and definite sum, and plaintiffs were entitled to recover the whole of such sum or nothing at all. It became due when plaintiffs demanded payment thereof from defendant, and under the plain provisions of § 66-101, O.C.L.A., plaintiffs were entitled to interest from that date.

In the case of Boyer et al. v. Edgemont Investment Co., 135 Or. 161, 168, 295 P. 471, decided in January, 1931, plaintiff brought suit to rescind a contract for the purchase of certain real property in Portland and to recover the amounts of money paid thereon. Plaintiff was awarded a decree and was allowed interest on the several amounts paid from the dates of the respective payments. On appeal, defendant contended that such allowance of interest was erroneous. This court disposed of the matter by simply stating: “Interest should have been allowed from the date of the decree only: Copeland v. Tweedle, 61 Or. 303, 309 (122 P. 302); Oregon Code 1930, § 57-1201; Or. L., § 7988.” (Italics ours.)

As heretofore noted, the case cited as authority for the above quoted sentence, viz., Copeland v. Tweedle, was decided before the amendment of 1917, and hence does not support the ruling made by the court. In the respects now under discussion, the statement of the court in Boyer et al. v. Edgemont Investment Co., supra, is expressly overruled.

In the instant case, the trial court should have rendered judgment in favor of the plaintiffs for the sum of $10,000, with interest thereon at the rate of 6 per cent per annum from the date it became due, instead of entering judgment for defendant as it did.

*144Under Or. Const. Art. VII, § 3, this court is empowered to direct the entry of judgment heretofore ordered. See exhaustive opinion of Mr. Chief Justice Brand in Gow v. Multnomah Hotel, Inc., on motion filed for recall and modification of mandate, dated March 7, 1951.

The petition for rehearing is denied.