Alabama Court of Appeals, 1917

Snead v. Groover

Snead v. Groover
Alabama Court of Appeals · Decided January 30, 1917 · Brown
74 So. 81; 15 Ala. App. 515; 1917 Ala. App. LEXIS 26 (Southern Reporter)

Snead v. Groover

Opinion of the Court

BROWN, J.

(1) While plea 1 is essentially a plea denying the plaintiff’s ownership of the note, and should have been sworn to, no objection was made to the plea, and the joinder of issue without objection waived the defect. — Milligan v. Pollard, 112 Ala. 465, 20 South. 620.

Pleas 4 and 5 allege, in substance, that the solé consideration of the note is usurious interest charged on a loan made by the Bank of Boaz to the defendants, and that plaintiff, the president of the bank, as a subterfuge, and for the purpose of evading the law and cutting off the defense of usury, took the note in his own name. These pleas present the defendants’ theory of the case.

The plaintiff’s theory is that the bank refused to carry the loan for the defendants, and that he (plaintiff) made the defend *518 ants a loan out of his .private funds to pay the debt to the bank, and that the bank had no interest in the indebtedness represented by the note in suit.

There is no controversy in the evidence that the transaction culminating in the execution of the note originated in a loan of $375 made by the Bank of Boaz, of which the plaintiff was president, that the defendants had paid on the loan, in two payments, $378, and had on two or more occasions given renewal notes, all of said transactions being conducted by the plaintiff for the bank.

The evidence offered by the plaintiff tends to show that he agreed with the defendant to make him a loan out of his own funds to take up the note held by the bank, and that he did make such loan and took the note involved here, and the bank surrendered its note to the defendants.

The evidence on the part of the defendant Groover shows that there was no suggestion by the plaintiff of any such loan, and he denies that such loan was made, and his testimony tends to show that he undertook to give a renewal note to the bank for the amount of the indebtedness, and, without his knowledge or consent, the plaintiff, who drew the note, made it payable to himself; that he thereupon drew a check in favor of the defendant and shoved it through the cashier’s window and asked defendant to indorse the check; that the note was signed and the check indorsed before defendant had any knowledge that the note was made payable to plaintiff.

(2) “A loan made in good faith, and at a legal rate of interest for the purpose of enabling the borrower to pay a debt owed to a third person, is not affected by the usury that may inhere in such debt.” — 4 Cyc. 999 (IV, G, 5 b) ; May v. Folsom, 113 Ala. 198, 20 South. 984.

On the other hand, if, in fact, the plaintiff made a loan to the defendants, ahd the loan was not in good faith, but a mere subterfuge to defeat the statute of usury, and the entire consideration of the note was usurious interest, the plaintiff was hot entitled to recover.

(3) Under the evidence and its tendencies, the question as to whether the plaintiff loaned money to the defendants and the bona tides of the loan was for the jury, and the affirmative charges on all the issues and also as to plea 4 requested by the plaintiff were refused without error.

*519 Charges 1 and 2 given at the request of the defendants asserted correct propositions as applied to the issues and were properly given.

In view of the tendencies of the evidence to show that the note sued on was a renewal note for an indebtedness originally due to the bank, and the evidence of payment thereon, charge 2 was properly refused.

(4, 5) Charges 4, 5, 6, 7, 8, 9, and 10 ignore the issue of good faith, and charge 11 is abstract.

Affirmed.

Case-law data current through December 31, 2025. Source: CourtListener bulk data.