Haseltine v. Central Bank of Springfield, Missouri (No. 2), 183 U.S. 132 (1901)

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Haseltine v. Central Bank of Springfield, Missouri (No. 2)

No. 63

Submitted October 29, 1901
Decided December 2, 1901
183 U.S. 132

ERROR TO THE SUPREME COURT

OF THE STATE OF MISSOURI

Syllabus

In an action upon a note given to a national bank, the maker cannot set off, or obtain credit for, usurious interest paid in cash upon the renewals of such note, and others of which it was a consolidation.

In cases arising under the second clause of Rev.Stat. sec. 5198, the person by whom the usurious interest has been paid can only recover the same back in an action in the nature of an action of debt. The remedy given by the statute is exclusive.

This was an action instituted in the Circuit Court of Greene County, Missouri, by the Central National Bank, to recover of the defendants the amount of a promissory note for $2,240, executed June 15, 1896, by two of the defendants as principals and two others as sureties.

The answer was a general denial and a special defense of usury in the original notes, and partial payments, as set up in the several paragraphs of the answer.

The case was referred to a referee, who reported the note sued upon to be a renewal note, and a consolidation of five original notes, the first of which was for $800, given July 27, 1891; the second for $100, of the same date; the third for $500, dated January 24, 1892, and credited by $100 payment thereon; the fourth for $340, dated January 16, 1893, and the fifth and last for $600, dated May 29, 1893.

The referee further found that the defendants had received on this note $2,240 (or rather out of the notes constituting that note) the sum of $2,199.35 in cash, making the amount reserved out of the note when it was made $40.65. That there had been paid cash discounts upon the several renewals of the notes which constituted the $2,240 note sued upon, down to October 24, 1894, exclusive of the amounts reserved out of the notes at the time they were originally given, the sum of $566.70, which cash discounts were paid in advance at the dates of the several renewals. That the whole amount of discounts and interest paid, as well as those deducted by the bank, upon all said loans from the beginning to the end down to and including the note sued on, was $947.50. That these payments were made in excess of the legal rate for said loans.

Upon this report, the court entered judgment in favor of the plaintiff for $2,199.35 (or, apparently, by mistake $2,199), that being the face of the note sued on after deducting the discount of $40.65, reserved when the note was executed. Upon appeal to the supreme court, this judgment was affirmed (155 Mo. 58), and defendants sued out this writ of error.