Harrison v. Stiles , 95 Ga. 264 ( 1895 )

Lumpkin, Justice.

The substance of the declaration and the evidence introduced in support of it are stated by the reporter. The court sustained a motion to nonsuit the plaintiff on the ground that the contract between Purtell and Stiles for the lending of the money was illegal and usurious. Afterwards the court reconsidered this decision, and granted a motion to reinstate the ease.

While the question presented is not entirely free from doubt, we are of the opinion that the court’s first view of the case was the correct one. By the terms of the agreement between Purtell and Stiles, the former was undoubtedly to receive usurious interest for the use of his money. He was to be paid 8 per cent., which is the highest legal rate in this State, and in addition thereto, one half of the commissions which were to be paid Stiles for negotiating the loan. It does not appear that the client of Stiles was aware of the details of this agreement, or that she knew a part of the commissions she had contracted to pay Stiles was to be turned over to Purtell as a part of the consideration of the loan. We do not think, however, that her ignorance as to this matter is material in arriving at a proper solution of the case. As between Purtell and Stiles, the contract was undoubtedly usurious and illegal. In other words, Stiles, as agent, had made a contract in behalf of his principal which was incapable of legal enforcement, and we do not think he is entitled to recover for services rendered in effecting such a contract. While it is true that if the contract had been fully executed, the borrower would have paid no usurious interest directly to the lender, it is also true that one of the results of the execution of this contract would have been a violation of our usui’y laws on the part of Purtell. A direct agreement by the borrower to pay the lender 8 per cent, interest and a bonus or commission for the use of the money, would undeniably have been usurious. She could not have made for herself a legal contract to this effect, and we hold that her agent could not indii’ectly do the same thing in her behalf by supplementing the interest she was to pay with a part of his commissions. Purtell undoubtedly could at will have repudiated the agreement he had made with Stiles, and could accordingly have declined to lend the money; so really, Stiles had not made for his client a contract which she could enforce in the event Purtell refused to comply with its terms. The fact that he was not at all likely to refuse, and that the repudiation came from her, is of no consequence. On the doctrine of mutuality, she certainly could decline compliance if he could. See Brown v. Baer, 79 Ga. 347, 353-4. The agent, having negotiated for his principal a contract which was not in law a valid and legal one, was not entitled to compensation; for the principal had the right to reject such a contract even though the other party, was willing to carry it out.

Judgment reversed.