Corp v. Brown — 4 N.Y. Super. Ct. 293

Majority

p. 293

Corp v. Brown.

Headnote

Under the section of the revised statutes forbidding any person to charge more than half of one per cent, for brokerage, soliciting or procuring the loan or forbearance of money, the broker or other person negotiating a loan, is entitled to only one Half of one per cent., whether the loan be for a year, or for a term of years.

Nov. 22;

Dec. 30, 1848.

This was an action brought by the plaintiff, to recover his fees and commissions as a broker, in procuring for the defendant a loan of $30,000, for five years, upon certain real estate of the defendant. The amount claimed was one half per cent, on the sum loaned, for each year, and interest. The declaration contained the ordinary counts, and also special counts for services. The defendant pleaded the general issue as to all but the sum of $150 ; and as to this amount, tender before suit brought. To this latter plea, the plaintiff replied, denying the tender. The cause was tried before Chief Justice Oaklet,, on the 11th day of May, 1848.

The plaintiff’s counsel read in evidence, a copy of a rule of the court made in this cause, and served upon him on the 18th of December, 1847. This rule was made upon the payment into court by the defendant, of one hundred and fifty dollars, and in terms provided, that unless the plaintiff should accept the same, with costs to be taxed, in full discharge of the action, that sum should be struck out of the declaration in the cause, and the same be paid out of court to the plaintiff.

It was then shown by the plaintiff, that in the fall of 1847, he had acted as the agent of defendant, in procuring a loan of $30,000 upon the real estate of the defendant, and that he had succeeded in effecting the loan for the period of five years.

The plaintiff rested. No testimony was offered on the part of the defendant. A verdict was rendered for the plaintiff for $776 25, being the amount claimed and interest, subject to the adjustment of damages, and subject to the opinion of the court, on a case to be made.

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J. M. Mason, and J. L. Mason, for the plaintiff.

F. B. Cutting, for the defendant.

The section of the act upon which this case is to turn, is as follows: “ No person shall, directly or indirectly, take or receive more than fifty cents for brokage, soliciting, driving, or procuring the loan or forbearance of one hundred dollars for one year, and in that proportion for a greater or less sum.” Is the plaintiff entitled, under this statute, to recover his commissions at the rate of half per cent, on the amount procured by him, for every year for which the loan was taken ? or is he to be limited to half per cent., where the loan is for a term of years ?

We have traced this section to its origin, and our researches have satisfied us, that the intention of the legislature never was to allow a broker the inordinate compensation here claimed. Previous to the last revision of our statutes, this provision was found in the “ Act for preventing usury.” (1 R. L. 63, § 3.) In England, it is first found in the “ Act against usury.” (21 James I., ch. 17; 2 Evans’ Stat. 285.) Next in 12 Chas. II., ch. 13; and in 12 Anne, ch. 16. (2 Evans’ Stat. 286, 287.) From these sources they were transferred to our act for preventing usury, passed 8th February, 1787. The revisors have not explained why they removed it from the usury act. They must have thought it more appropriately came under their title “ Of brokerage, stockjobbing, and pawnbrokers.” Still, we may look to the place and the company in which this provision was first found, and so long afterwards continued, for a key to the intention of the legislature in respect to it. In the usury acts of England, above referred to, and in both of ours, (1 R. L. 62, and 1 R. S. 760,) the main section which prohibits the taking of more than a fixed rate of interest, contains these words : “ And after that rate for a greater or less sum, or for a longer or shorter time the latter words being evidently employed to provide, that on a loan of money, the borrower should, for each successive year, pay the sum fixed as interest. In all the English statutes, the provision respecting the compensation to brokers

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is found in a section immediately preceding the one fixing the rate of interest. So, also, in our revised laws. If in two sections, the one so immediately following the other, in the second a portion of the words employed in the first are omitted, it shows that the legislature had an object in so marked an omission. Now, in the sections to prohibit usury are to be found, not only these words contained in the section fixing the premiums of brokers, “And so after that rate for a greater or less sum," but the additional words, “ Or for a longer or shorter time." The omission of them in the second section, serves to show conclusively to our mind, that the legislature did not intend that the compensation of the broker should be increased in proportion to the “ longer time” the loan was to run. The omission is too marked and studious not to indicate this object. The statute was passed evidently for the benefit of borrowers; to prevent the lender from practically evading the usury act, by interposing his broker between himself and the victim of his cupidity. Its object was to fix a limit beyond which the broker should not charge. It is a well known fact, that loans for a long time on good security, in this city, are more easily procured than short ones; and it is hardly to be presumed that the legislature intended to swell the broker’s compensation according to the greater facility with which his duty is accomplished. Yfe are satisfied, that the legislature intended to give only half per cent, on the sum loaned, without reference to the time it is to run.

The plaintiff must take up with the $150 and interest.

Judgment accordingly.