Roberts v. Life Insurance Co. ( 1896 )

The following issue was submitted: "What amount, if any, is the plaintiff entitled to recover?"

J. D. Roberts, the plaintiff, testified as follows: "I (430) borrowed $900 from the defendant in May or June, 1891; received $400 on 3 June, 1891; then $500 on 4 August, 1891. I executed note and mortgage of deed of trust to secure the money borrowed. I borrowed it to build a house in the town of Durham. I made payments as follows: $9, 22 May, initiation fee; $10.80, 30 May, 1891, and $15.30 per month thereafter for twenty-eight months; during May, June, July and August, 1893, I paid $9 in fines; 20 March, 1894, I paid $769.07, balance claimed by defendant as due on loan. I conducted the transaction of negotiating the loan through Mr. J. F. Slaughter. I was a borrower from the defendant. Mr. Slaughter held an office in the local board which was organized in Durham, and managed the local business here. He negotiated this loan for the company. He examined, with two others, my property and appraised it. He received the application for this loan; got the $900 through Mr. Slaughter. He was cashier of the Fidelity Bank." Payments were made to me by check on the Fidelity Bank." Plaintiff offered a receipt, signed by J. F. Slaughter, agent, for $8 for subscription fee for eight shares of stock in defendant company. Defendant objected, on the ground that agency was not proved; objection overruled. Defendant excepted. "I applied to Mr. Slaughter for money. He said: `You can get money. If the company does not have it when you need it you can get it from the bank, which would advance it.' I told him that I wanted money to build a house." The defendant objected to all this evidence; objection overruled. Defendant excepted.

The plaintiff offered an endowment certificate. "I took nine shares of stock in defendant company. All the agreements with the company were made on the same day. I was charged $1.20 (431) per share on the stock. When I applied for the loan, two propositions were made me by Mr. Slaughter — one to invest, the other to borrow; I chose the latter." Defendant objected; objection overruled. Defendant excepted. "The monthly payments were made to the local treasurer of the defendant; J. F. Wily, first local treasurer; J. B. Mason, second; W. W. Whitted, third. The defendant had a local board here. Mr. Slaughter and B. N. Duke assessed my property. The deed of trust was made to F. L. Fuller and J. F. Slaughter. The bond and deed of trust have been paid. The deed was marked `Satisfied, March 31, 1894.'"

On cross-examination plaintiff said: "Got money from the company when I needed it. Checks were given on Fidelity Bank, signed by company. Slaughter was cashier of this bank. Mr. F. L. Fuller filled up the mortgage. I was a resident of Durham when I borrowed this money; property situated here. I wanted to leave the State. I left the State on 19 March, 1894, and have since then resided in Florida; reside there now; reached Florida on 20 March, 1894. Before leaving Durham I left money to pay defendant with my attorneys, Fuller Fuller. I saw Mr. W. W. Fuller write a check to the company. The $769.07 was paid to the defendant at its office in Richmond, Va.; it was not paid to the local treasurer."

At the close of the evidence defendant requested his Honor to instruct the jury as follows:

"1. That the plaintiff, having full knowledge of the facts and having paid the alleged usurious interest, cannot recover the same, and the issue should be answered `No.'

"2. That, having paid said sum for more than two years (432) since the commencement of this action, the issue should be answered `No.'

"3. That the contract under which the money was paid was not usurious.

"4. That, so far as this action is concerned, the contract is governed by the laws of Virginia, and is therefore not usurious.

"5. That upon the whole evidence the plaintiff is not entitled to recover.

"6. That both the plaintiff and defendant were nonresidents of this State when the alleged cause of action occurred and when this action was commenced, and, this alleged cause of action having arisen in Virginia, the court has no jurisdiction of this action."

After argument of counsel it was agreed that a jury trial should be waived and that the court should find and answer the issue instead of the jury. The court, upon consideration of the testimony, admissions and exhibits, answered the issue $445.54, the said amount being double the interest found by the court to have been paid by the plaintiff to the defendant within two years prior to the beginning of the action, 11 March, 1895, the interest so paid, consisting of seven monthly payments, beginning with 25 March, 1893, of $4.50 each, paid and received as interest, and various sums amounting to $9 paid as fines during 1893, and $182.27 included in the sum of $769.07, paid 20 March, 1894, in the final settlement, all of said sums aggregating $222.77.

The court held that the plaintiff was not entitled to recover the interest paid prior to 11 March, 1893, consisting of twenty-one monthly payments of $4.50 each, paid and received as interest, aggregating $94.50, and the subscription fee of $9. (433)

The court adjudged that the plaintiff recover of defendant $445.54, with interest from 7 October, 1895, and costs. From this judgment plaintiff appealed, assigning as error that the same adjudges that the plaintiff was not entitled to recover the interest paid prior to 11 March, 1893, and also that said judgment, given upon the usurious payments made within two years before bringing this suit, ought to have been $655.44 and not $445.54.

The defendant also appealed, contending that if his Honor should answer the issues for the plaintiff he should only find the sum of $251.52, and at the request of his Honor, submitted a calculation as to the manner of ascertaining and arriving at said amount, excepting also to the amount fixed by his Honor. This is an action to recover back usurious interest paid to the defendant by the plaintiff, commenced 11 March, 1895. It was admitted on the argument here that Miller v. Insurance Co., post, 612, decided all the matters involved in this case, except three: First, whether the plaintiff, being a nonresident, could maintain this action; secondly, whether this was a Virginia contract or a North Carolina contract; and thirdly, as to whether the interest paid by plaintiff more than two years before the commencement of the action should be included in the recovery or not.

The answer to the second proposition will substantially answer the first. The defendant is a Virginia corporation, but by comity is doing an insurance business in this State and has an office in the town of Durham and an agent located at that place. The local (434) agent negotiated this loan in Durham, which defendant alleges is a part of its business and is authorized by its charter. All the interest on this loan was paid to the local agent in Durham, upon whom service of process in this case was served. It was a North Carolina contract.

The court had jurisdiction of the subject-matter and of the defendant by personal service, made according to law. And as defendant failed to show authority for this contention, we are at a loss to know upon what ground it is put, and we must sustain the jurisdiction of the court. In Sherrill v.Tel. Co., 109 N.C. 527, and 116 N.C. 655, and a number of other cases similar to this, the courts have acted upon the idea that they had jurisdiction. But it does not appear in these cases that this question was directly presented. It may have been an oversight in the counsel in these cases not to do so; and while these points are made in the case on appeal, we do not think they were seriously relied on here. The main point in the case, argued and relied on here, was the question of time for which the plaintiff should be allowed to recover, plaintiff contending that he should recover double the amount of all the usurious interest he had paid, and defendant contending that he should not be allowed to recover for any interest paid more than two years before the commencement of the action. The court held with the defendant on this point, and the plaintiff excepted.

This contract, by which the plaintiff borrowed $900 from the defendant, was made in June, 1891, as plaintiff alleges; and plaintiff's right of action therefore rests upon section 3836 of The Code. Chapter 69, Laws 1895, was ratified 21 February, 1895, but it expressly provides that it is not to apply to any contracts entered into before its ratification. If the act of 1895 had applied, the (435) contention of plaintiff would have been correct, as it provides for bringing an action to recover back double the amount of usurious interest paid if the action is brought within two years after the paymentin full of such indebtedness, in this respect changing from 3836 of The Code, which provides that "the action must be brought within two years from the time the usurious transaction occurred."

It was contended for the plaintiff that the statute of limitations must be pleaded, and as the defendant had not done so in this case he could not have the benefit of this defense, and cited authorities to sustain this position. The plaintiff is correct in his law, but it has no application to this case. The defendant's contention does not depend on the statute of limitations, but upon plaintiff's right of action. His right to recover anything depends upon the statute. It is purely a statutory action, and he must comply with the terms of the statute or he cannot recover. Therefore, under section 3836 of The Code, unless he commences his action within two years from the usurious transaction, he has no cause of action. Taylor v.Iron Co., 94 N.C. 525; Best v. Kinston, 106 N.C. 205. There is no error and the judgment is affirmed.

DEFENDANT'S APPEAL.