City of Los Angeles v. City Bank

Citations

• 100 Cal. 18
• 34 P. 510
• 1893 Cal. LEXIS 742

Syllabus

<p>Banks—Deposit of City Funds—Illegal Contract—Interest.—Where a city entered into an illegal contract with a bank, by which the bank was to receive the public moneys of the city and pay interest thereon for one year, and the city at the end of ten months, on discovery of the illegality of the contract, demanded and received all the moneys deposited, but without interest, it cannot under such circumstances recover the interest in an action against the bank for money had and received.</p> <p>Id.—Payment of Principal Bars Subsequent Recovery of Interest. When interest is not specially contracted for, it is but an incident of the contract or obligation upon which it depends, and cannot be recovered in a separate action after payment of the principal.</p> <p>Id.—Interest When Due.—In the absence of an expressed contract, the law only awards interest upon money from the time it falls due.</p> <p>Id.—Maturity of Moneys Deposited—Demand.—Money deposited in bank without special contract is not due until demand, and, if paid on demand, no interest thereon is collectible.</p> <p>Id.—Implied Contract—Illegal Contract.—The law will not presume a contract to pay interest where to have agreed directly to do so would be a'felony, rendering the contract void.</p> <p>Id.—Profits of Illegal Use op Money.,—Interest cannot be recovered under an illegal contract under the guise of profits. The court will not lend its aid to a cause of action founded upon an illegal act; and a city cannot recover a profit upon the public moneys in violation of the constitution and statutes.</p>