Candee and Scribner v. Webster.

1824, under which the attachment proceedings mentioned in the record before us, were conducted, is only to be regarded an action for the recovery of an existing indebtedness. The section under which the garnishment of defendant in error was had, simply authorizes the collection of a debt by a third person, by his creditor, instead of its being collected by the payee, the person himself to whom the same is due.

The real question before us, therefore, seems to be this: Is it incumbent upon the debtor where the general rule of law imposes interest as an incident to delay in payment, to show a cause for a suspension of the general rule; or is a cause of suspension to be 458] presumed merely *from the fact of payment being demanded by the creditor of the debtor's payee.

All the adjudications in other states referred to, seem consentaneous upon the reason for which the garnishee should be exempt from paying interest during his garnishment. And that reason is, that during the pendency of the attachment proceedings, the garnishee is, while so exempt from paying interest, holding the money as a trustee for another, and without using it, or deriving any benefit from so holding it. The exemption is put upon the ground, in Pennsylvania, that the attachment prevents the use, and receipt of profit thereby, of the money by the garnishee, and rests, consequently, upon the same principle as the question of interest in the case of Osborn and others v. Bank of the United States, 9 Wheat. 738. But that was a case arising under positive proof of the party being put, by law, in the attitute of a stakeholder. Osborn, as the auditor of the State of Ohio, being about to enter the bank, with process, and seize upon $50,000 specie, to satisfy a delinquent tax, the bank procured, in the circuit court of the United States, the allowance of an injunction against his taking the money. But the injunction was only served upon Osborn after he had taken the money from the bank at Chillicothe, and while on his way to the treasury at Columbus. In that case, the auditor, Osborn, in obedience to the injunction, having retained the money in his possession, in the attitude of a stakeholder between the two claimants, the bank on the one hand and the state on the other, the court very properly held that he ought not to be chargeable with interest while so restrained from using the coin in question, at the instance of the party to which it was decreed to be paid. The court say of the injunction suit in that case: "Its effect and operation were to place it (the

Candee and Scribner v. Webster.

coin) in the custody of the law. The defendants could not use it, and consequently can not be charged with interest."

And it is only upon the fact being proved or presumed that *a garnishee is in like manner restrained from using the [459 amount of money necessary to pay his indebtedness, and that the same was by the attachment proceedings placed in the custody of the law, that the garnishee has been held exempt from payment of interest, in the State of Pennsylvania and other states, during the attachment proceedings.

The precise question, therefore, before us, is, may such fact be presumed in favor of the debtor, or must it be proved by him, like any other defense, after the proof of his indebtedness and liability by the plaintiff?

It has already been seen that the law subjecting the debtor to the liability of paying interest in this state, continues such liability as an incident to the debt, "until such debt, money, or property is paid." The statute makes no exception in favor of any legal proceedings. And the exemption by reason of an injunction or garnishment seems to rest entirely upon the idea of the money being actually held by the party in readiness to be disposed of as directed by the court; and so being in the custody of the law, to be regarded a quasi payment, as if placed on deposit subject to the order of the court. Nothing short of such a state of facts, we think, should have exempted the defendant in this case from the payment of interest during the pendency of the attachment proceedings. The record shows no proof of such a state of facts in this case. It is not pretended that the defendant, either before or during the attachment, expressed a wish or even willingness to pay his indebtedness. Nor does it appear that he was ready to pay. If, then, the defendant is in law exempt from payment of interest during the time of his garnishment, for the reason that he was actually holding the money ready and willing to pay, but was prevented by the attachment proceedings, such state of facts must be presumed. But a presumption is the supposition of a truth, grounded on circumstantial or probable evidence. It should always be a natural and reasonable deduction from *pertinent circumstances and relative existing facts, to [460 constitute a legal presumption.

Are there, then, any circumstances or facts shown in this case from which the defendant may reasonably be presumed to have held the money during the time of his garnishment, in readiness to pay 369

VOL. IX-24

Gebhart et al. v. Adm'x of Sorrels et al.

the debt, and to have been prevented paying by such attachment proceedings?

The facts shown by the record are, that the debt had been due for some time previous to the attachment, and that it remained due for a long time after the attachment was dismissed or terminated, without any offer to pay on the part of the defendant. Add to this the fact that the defendant had it in his power during all the time of the attachment proceedings, whenever ready and desirous of paying, to bring the money into court and pay the same under the order of the court, upon motion or bill of interpleader, and to have released himself from further liability, and the natural presumption would seem to be, that the defendant was not ready and willing to pay.

We do not think that in such cases as the one under consideration, any presumption arises from the fact of the attachment proceedings that should exempt the garnishee from paying interest during the pendency of such proceedings. A party seeking to avail himself of an exemption from his general liability to pay interest on his indebtedness under such circumstances, must show such a state of facts as in equity entitle him to exemption. No such state of facts appears upon the record in this case. We think, therefore, that the district court erred in bolding that the defendant was not chargeable with interest during the pendency of the attachment proceedings, and for this cause the judgment of that court must be reversed, with costs.

BRINKERHOFF, C. J., and SCOTT, PECK, and GHOLSON, JJ., con

curred.

461] *GEORGE C. GEBHART Et al. v. MargarET SORRELS, ADMINISTRATRIX OF WILLIAM SORRELS, ET AL.

Ar answer stating a defense under the 5th section of the act to restrain banki from taking usury, which omits to disclose the facts and circumstanc is showing a reason to believe that the drawers of a bill of exchange discounted would not be prepared to pay the same at the time of payment, is not defective upon general demurrer. If the purpose of justice should so require, the court would have a discretion, upon a motion for the purpose,

Gebhart et al. v. Adm'x of Sorrels et al.

to require the facts and circumstances relied on to be disclosed in the pleading. When an answer to an action on a bill of exchange, brought by an indorser, relies on an illegality in the contract between the original parties, ordinarily some statement affecting the title of the plaintiff is required; but when the petition itself discloses facts from which it might be inferred that the plaintiff was not a holder for value in the usual course of trade, the defendant is entitled to the benefit of the admissions in the petition, to sustain his answer against a general demurrer.

IN error to the district court of Pickaway county.

An action was brought in the common pleas of Pickaway county by William Sorrels against George C. Gebhart, Augustus L. Perrill, and Peter K. Hull, upon a bill of exchange for $1,400, drawn by them, directed to Geo. S. Coe, New York, and payable to the order of H. R. Lawrence, cashier of the Bank of Circleville, four months after date, "or whenever thereafter presented at the office of the American Exchange Bank in New York." A copy of the bill with its indorsement was set out. The bill was connected with a warrant of attorney to confess a judgment, and was sealed by the parties. It contained on its face a waiver of acceptance, and of demand, notice, and protest. The indorsement was as follows: "Pay to Wm. Sorrels, Esq., or order, without recourse. H. K. Lawrence, cashier of Bank of Circleville." The petition stated that the bill was indorsed before its maturity to the plaintiff, and was held by him as owner.

To the petition of the plaintiff an answer was filed, which *stated that the defendants borrowed of the Bank of Circle- [462 ville, an incorporated bank in Ohio and then doing business, the sum of $2,500, and gave said bank a bill on New York for that sum, payable in ninety days; "the said Gebhart was principal on said bill, and said Perrill and Hull were sureties, and their suretyship was known to the bank. Said Gebhart paid the bank at the time of borrowing said money, as the interest for the same, $38.75 for said bill of $2,500; he received only $2,461.25 of said bank. At that date exchange was in favor of New York and against the county of Pickaway, in which county said bank did business, and where said bill was given and said money was borrowed; said Gebhart gave the bank a bill of exchange because said bank would not lend money on promissory notes, but habitually loaned money on bills of exchange, in order to obtain a greater rate of interest

Gebhart et al. v. Adm'x of Sorrels et al.

than six per cent. The bill sued on in this case was given to renew the bill first above named, said Gebhart having made payments thereon to the bank. At the time of said renewal, and at the time of drawing said original bill, said bank, by its officers, had reason to know and believe that the drawers were not prepared and did not intend to pay said bills, and would not be prepared to pay said bills at New York, and had no funds there, and did not intend to place any funds there, to meet said bills. The officers of said bank had reason to know this. New York, at which place said bill was payable, is a place without the State of Ohio. The said bank at Circleville was a banking institution in this state, and said bills of exchange on New York were devices resorted to in order to secure to said bank a greater rate of interest and profit than it could realize from the discount or purchase of such paper if made payable at its own counter. The said bank charged $1.25 for three days of grace at the time of drawing said bills. The defendants say said bill is void for usury."

The plaintiff excepted to the answer of defendants as insufficient; 463] and this exception, upon a hearing by the *court was sustained, and the answer set aside as insufficient; and no further answer being offered, a judgment was rendered in favor of the plaintiff. An appeal was taken to the district court, and the same question as to the sufficiency of the answer was made in that court, and decided in the same way. To this decision of the district court an exception was taken; and upon a petition in error, filed in this court, this action of the district court is the error assigned.

Page & Renick, for plaintiffs in error.

C. N. Olds, for defendant in error.

GHOLSON, J. No point has been made in this court as to the form in which the court below passed upon the sufficiency of the answer. The exception to the answer appears to have been regarded by the parties as a proper substitute for a demurrer, which was not then allowed by the code, but which, by a new provision, is now permitted. We shall proceed to consider the case as if a general demurrer had then been allowed and had been filed.

It is claimed by the counsel for the defendant in error that the answer was framed to make out a defense under the fifth section of an act of the 19th of March, 1850, "to restrain banks from