alty of treble the amount of money loaned,
if more than five per cent. interest is charged.
And this privilege of the Bank of England,
about which the great financiers of this body
have talked so much, is simply a provision
passed in the time of George I, allowing the
Bank of England to borrow money at what
rate it pleases. France has the same usury
laws. Every enlightened commercial State of
this Union has them. New York has them ;
Pennsylvania has them.
What are the provisions in New York
down to this day? They forbid the recovery
of more than a fixed rate of interest. And
the courts of that State have put it upon the
ground of protecting the weak against the op-
pressor. Chief Justice Savage, in speaking
for the supreme court of New York, declares
in one case:
' ' In making this remark, I mean not any
reflection on the justice or policy of the laws
prohibiting usury. On the contrary, I be-
lieve such laws perfectly just and proper.—
They <are necessary to protect the necessitous
against their own acts of indiscretion. Nor
would I impute moral guilt to those who re-
ceive more than the legal rate of interest, pro-
vided their exactions do not become oppres-
sive. Usury is malum prohibitum—not ma-
lum in se."
And that is the ground upon which these
usury laws are based. It is to protect the ne
cessitous against the exactions of the oppres-
sor. And here is a law as late as the year of
grace 1860, of our neighboring State of Penn
sylvania, where the rate of interest is six per
cent. By that law all the excessive interest is
forfeited, and a man who has paid it is allowed
to go into a court of law and recover the
amount of excessive interest be has paid, up-
on an action of assumpsit. What does the
learned court of that State say upon this same
subject? It was an action brought after a
man bad paid more than six per cent, interest
Mr. CUSHING. Cannot seven per cent. in-
terest be recovered in New York to-day ?
Mr. MILLER. I say that if more than seven
per cent. is taken in New York you can re-
cover it back. And in Pennsylvania, where
the rate of interest is six per cent., the court
has taken this ground ;
" The early disposition of the English courts
was to deny the right of a party paying such
interest to recover back any portion of the
money paid, for the reasons that both parties
to such a transaction were deemed to be '' in
pari delicto," and the excess of interest was
regarded as paid voluntarily, so that the max
im ''volunti not fit injuria" would apply.—
[1 Salk., 22 ] The authority of this decision
however, was soon questioned, Lord Mans-
field declared that the case had been decided
a thousand times. [Cowper, 199.] At a later
day a distinction was taken between transac-
tions under statutes enacted on grounds of gen-
eral policy, where each party violating the |
law is held to be in equal fault, and transac-
tions under the usury laws, enacted to protect
the weak and needy from being defrauded and
oppressed. To the latter the law does afford
relief. It regards the lender or usurer as an
oppressor, and the borrower as the injured and
oppressed."
The supreme court of Pennsylvania sanc-
tioned that doctrine as late as 1860. Every
one of the commercial States of the Union has
the same provision. All the New England
States, New York, New Jersey and Pennsyl-
vania have it. And it is only in some of the
western and southwestern "wild-cat "States
where they have allowed parties to contract
for what rate they please, in order to induce
capital to go into those States, And in some
instances capital has been induced to go there
by the opportunity of investing at fifteen and
twenty per cent. And capitalists have made
a permanent investment, never having got one
cent back.
Mr. CUSHING. How is it in Ohio?
Mr. MILLER. I have not looked at the pro-
visions of Ohio. Gentlemen say that the
plea of usury is a rogue's plea. Why, gen-
tlemen who are lawyers know that in every
court in this country, and in England, too,
there is no head of the law under which so
many cases are decided, as the head of " usu-
ry." The books are full of cases in which the
usury laws have been enforced. Time and
time again in England penalties have been
recovered of treble the value of the amount
loaned. The courts have said that the plea
of usury was a just plea, and Lord Mansfield
declared that it was beyond the device of man,
by any contrivance whatever, to avoid the
usury laws. If the contract was a contract
for the loan of money, and more than five per
cent. was taken, it was usury. You might
cover it up as you pleased; yet a court of
equity would ferret out the transaction, and
if it could find the usury, it would strike
down the contract, principal and all, and
impose the penalty. These laws have been
always the favorite of the courts; they have
always enforced them.
With these views, I submit that the ques-
tion is directly up before this convention,
upon this report, whether we are any longer
to have usury laws in Maryland. If you al-
low men to contract for whatever rate of in-
terest they please, and make that contract
valid, you are in effect breaking down your
usury laws.
Mr. NEGLEY. The gentleman from Anne
Arundel (Mr. Miller) says that the Bank of
England is allowed to borrow money at
any rate it pleases; and he also says that
there is a law in England fixing the rate of
interest at five per cent., and that any indi-
vidual who takes more than that is liable to
a forfeiture of the whole contract and a pen-
alty of treble the amount. Now I suppose
that corporations would not be allowed any |
