Citizens' Security & Land Co. v. Uhler

Alvey, J. filed the following dissenting opinion, in which Judge Stewart concurred : I do not assent to the opinion of the majority of the Court in this case. I do not agree that the Legislature transcended its constitutional powers in passing the Act of 1872, ch. 178, and that that Act is consequently void. The Constitution does not declare that the Legislature shall only provide the rate of interest hy a general law- applicable to all contracts and to all parties, without exception, but it has plenary and unrestricted power over the subject. “The legal rate of interest shall he six per cent, per annum, unless otherwise provided hy the General Assembly.” This provision of the Constitution has been uniformly interpreted hy the Legislature as conferring power, or as not in any manner restricting it in the exercise of the power, to provide for the rate of interest that it may be lawful for parties to contract to pay in a particular class of contracts. And, hence we find on the Statute book several Acts authorizing corporations, engaged in public enterprises, to issue bonds to hear interest at a greater rate than six per cent. ; and I am far from being convinced that the Legislature acted without warrant or authority in passing those Acts.

I am authorized hy Judge Stewart to say that he agrees with me in the foregoing opinion. Robinson, J., delivered the opinion of the Court. The appellee borrowed of the appellant six thousand and eight hundred dollars, for ten years, and to secure the payment of this sum he executed two mortgages, hy which he agreed to pay interest on said loan weekly during the continuance of the mortgages; and also a premium of twenty-five cents weekly on each of seventeen shares of stock, making nine and a half per cent, interest, and in addition to this interest, he agreed also to pay such fines and penalties as might be imposed upon him by the by-laws of the company. ⁴⁵⁷ The payments being in arrears, the mortgaged premises were sold on an ex parte proceeding in pursuance of sec. 782, of Art. 4, of the Code of Public Local Laws. After the ratification of the sale, the appellee filed a petition disputing the amount claimed to he due by the appellant on the two mortgages, and prayed that the matter might be referred to the auditor with power to take testimony, in order that the precise sum due might be ascertained.

The case was referred, and proof was taken, and four accounts, ££B,” ££ C,” í£ D,” and ££E,” were stated by the auditor. Account ££B,” was stated according to the terms prescribed by the mortgages, and according to the views of the appellant. Account ££C,” was stated in accordance with the decision in the case of the Baltimore Permanent Building and Land Society vs. Taylor, 41 Md., 409 , in which the appellant was allowed the legal rate of six per cent, on account of the money loaned to the appellee, and this account the auditor states, shows, according to his opinion, the correct amount to which the appellant is entitled. To account ct O ” the appellant excepted on the ground, among othei’s, that the auditor had not allowed interest according to the terms of the mortgages Exceptions were also filed by the appellee to accounts ££B,” ££ D ” and ££E,” for the reasons stated in the auditor’s report, and for other reasons to be shown at the hearing, and prayed the Court to ratify account ££C.” The Court rejected accounts ££B,” “ D ” and ££E,” on the ground of usurious interest allowed the appellant, and being of opinion that the transaction was a mere loan of money, to secure the payment of which the two mortgages were executed, ratified account ££C,” in which the appellant was allowed interest at the rate of six per cent. ⁴⁵⁸ It is now contended, that the question of usury was not raised hy a special plea, nor was it relied on as a defence to the appellant’s claim, and that the Court