Union Trust Bank v. Ward, 202 N.C. 691 (1932)

May 4, 1932 · Supreme Court of North Carolina

202 N.C. 691

UNION TRUST BANK v. F. C. WARD, J. W. WARD, J. Y. WALKER and W. H. SHULL.

(Filed 4 May, 1932.)

States A a — Where contract is not usurious in state in which it is executed it will not he held usurious in action brought here.

A note for money borrowed from a bank in another state and executed and delivered there, -bearing a rate of interest that was there legal, will not be held as usurious in an action brought in the courts of this State.

Appeal by defendant, F. 0.. Ward, from MacBae, Special Judge, at November Term, 1931, of Watauga.

No error.

Plaintiff is a banking corporation organized under the laws of the State of Tennessee, and doing business in said State. The defendant, E. C. Ward, is a citizen and resident of the State of Tennessee. His codefendants are citizens and residents of the State of North Carolina.

This is an action to recover on a note payable to plaintiff, and executed in the State of Tennessee by the defendant, F. C. Ward, as maker, and by his codefendants as endorsers before delivery. The note is dated 30 August, 1929 and was due on 30 June, 1930. This action was begun on 2_ August, 1930.

There was judgment by default, for want of an answer, against the defendant endorsers. In his answer, the defendant, F. C. Ward, admitted the execution of the note and set up a counterclaim upon his allegation that plaintiff had charged and received interest on the money loaned to him by the plaintiff in excess of six per cent per annum, contrary to the laws of the State of Tennessee. Plaintiff admitted that it had charged and received interest on the money loaned to the defendant at the rate of eight per cent per annum, and alleged that at the time the money was loaned to defendant, such rate of interest was lawful in the State of Tennessee. The note sued on in this action is for the balance due on a loan of money made by the plaintiff to the defendant in 1922.

The only issue submitted to the jury waá answered as follows:

“Is the defendant indebted to. the plaintiff? If so, in what sum? Answer : Tes, $1,100, with interest from 30 June, 1930.”

From judgment that plaintiff recover of the defendants the sum of $1,100, with interest and costs, the defendant, F. C. Ward, appealed to the Supreme Court.

Bingham, Linney & Bingham for appellant.

Pee Cuexam.

The defendant’s assignments of error based on his exceptions to the instruction of the court to the jury, as requested by plaintiff, and to the refusal of the court to instruct the jury as requested by defendant, cannot be sustained.

The evidence introduced by the defendant did not support the allegations in his answer upon which he relied for his counterclaim. At the date of the loan of money to the defendant by the plaintiff, it was lawful in the State of Tennessee to charge and receive interest at the rate of eight per centum per annum. Interest paid at this rate prior to the execution of the note sued on in this action was not usury. The judgment is affirmed.

No error.