APRIL TERM, 1916.

EAMES v. BARBER.

1. USURY-RENT-LANDLORD AND TENANT-LEASE-INTEREST-DIS

TINCTIONS.

Under Consolidated Laws New York (1909), Vol. 2, § 370 et seq., the rate of interest is limited to 6 per cent. By statutes of Texas interest is defined as the compensation allowed by law or fixed by the parties to a contract for the use or forbearance or detention of money. Interest rates in Texas are limited to 10 per cent., in New York to 6 per cent. In a suit to recover an installment of rent on a lease of certain real estate located in Texas, brought in Michigan by the lessors, who were residents of New York, providing for the payment by lessees of twenty per cent. of the amount invested in the Texas property, and a 10 per cent. fee for services in clearing the land and preparing for the first crop by lessors to be paid at Buffalo, N. Y., in semi-annual installments, where no proofs tending to show any intent to evade the statute were offered, held, that the rental was recoverable as such and no usurious conditions had been shown. Cf. 2 Comp. Laws 1915, § 5998.

2. SAME INTEREST.

Interest is a charge for the loan or forbearance of money. In order to bring a contract within the theory of the statute, the use of money, or a debt, must be the basis of the transaction.

3. APPEAL AND ERROR-HARMLESS ERROR.

A correct result reached by the trial court will be affirmed on error, even if a wrong reason therefor be given.

4. FRAUDS, STATUTE OF-SUFFICIENCY OF WRITING.

In a lease for more than one year, in which the rental was fixed at twenty per cent. of the amount invested, which was made certain by other provisions, and though no amount was named the terms were not left in uncertainty, no further or more explicit provisions as to rental were demanded to bring it within the requirements of the statute of frauds.

Continued from Vol. 191.

Error to Berrien; Bridgman, J. Submitted April 12, 1916. (Docket No. 111.) Decided June 1, 1916.

Assumpsit by Milo D. Eames and another against Herbert O. Barber and others for the recovery of an installment of rent. Judgment for defendants on a verdict directed by the court. Plaintiffs bring error. Reversed.

Gore & Harvey (Joseph H. Morey, of counsel, for appellants.

Coolidge & White (C. C. Flansburg, of counsel), for appellees.

Plaintiffs sued to recover an installment of rent reserved in a certain indenture of lease, declaring specially. With a plea of the general issue defendants gave notice that upon the trial they would maintain that the said indenture on its face authorizes the taking by plaintiffs of “a greater sum or value for the use, loan, detention, or forbearance of money than is allowed by the law of the State of New York," where the agreement was to be performed, and where the indenture was executed, and that under the laws of the State of Texas, where the writing was executed and where the land described therein is situated

"whenever a contract authorizes on its face the taking and receipting of a greater sum or value for the use, loan, detention, or forbearance of money than 10 per cent. per annum the interest authorized by such contract becomes forfeitable, and the plaintiff who brings action upon such contract can recover no interest by reason of usury; that the said writing on its face authorizes the reservation of 20 per cent. per annum for the use, loan, forbearance, or detention of money, and the defendants claim that no recovery can be had upon the said writing by virtue of the said law of the State of Texas.

"The defendants will further snow and insist that the 20 per cent. to be paid annually by the defendants to the plaintiffs upon certain sums of money mentioned in said writing is of the nature of interest on sums of money advanced or to be advanced by plaintiffs for the use of the defendants and intended by the parties to said writing as interest, and that by the laws of both the States of Texas and New York said contract in said writing contained is usurious, and that under the laws of both the States of Texas and New York no recovery can be had upon said writing by the plaintiffs against the defendants by reason of the usurious interest authorized by said writing."

Notice is given, too, of the claim that the writing was procured by fraudulent representations and promises of plaintiffs. Upon the trial counsel for both parties moved the court for a peremptory verdict; the grounds of defendants' motion being:

First, that the lease was a contract required to be in writing, and it does not satisfy the statute of frauds. Second, that the contract (lease) is a usurious contract, and therefore wholly void, and, in consequence, the demand sued upon is a usurious demand.

The court charged the jury to return a verdict for the defendants; the sole ground for the ruling being that under the laws of either New York or Texas the contract was usurious. Such a verdict was returned and upon it a judgment for defendants was rendered.

In this court the first ground asserted in moving for a directed verdict is again asserted by defendants as ground for sustaining the judgment; the proposition being:

"That the contract declared upon is void as a lease or as an agreement for a lease under the statute of frauds, because it does not express the substantial terms required in such an instrument nor the rental prices to be paid with such certainty that they can be understood without resort to parol evidence."

The indenture referred to reads as follows: