Armor v. Bank of Loudon

Citations

• 86 Miss. 658

Syllabus

<p>1. Building and Loan Associations. Usury.</p> <p>Where the subscription for stock in a building and loan association was not an investment, but a part of a scheme to secure a loan, and the monthly payments on the stock for interest, dues, and premiums amounted to more than ten per centum, the highest legal contractual rate, the loan was usurious.</p> <p>2. Same. Giving new notes. Innocent holder.</p> <p>The giving of new notes for the balance appearing to be due on old and usurious ones does not purge the usury, although the new notes be made payable to a volunteer third person and be transferred by said person to an innocent party.</p> <p>3. Same. Payment of principal. Cancellation of securities. Code 1892, § 2348.</p> <p>Under Code 1892, § 2348, providing that, if a greater rate of interest than ten per centum shall be stipulated for or received, all interest shall be forfeited and may be recovered back, whether the contract be executed or executory, a complainant, having paid the principal of an usurious debt, is entitled to the cancellation of a deed of trust given for its security, even as against an innocent holder of the notes, evidencing the debt, and the deed.</p>