ARK.] TISDALE V. MANESS. 465 TISDALE V. MANESS. 4-4224. Opinion delivered March 23, 1936. LTsuay.—The finding of the' co u r t . beloW that transaction was bne of borrowing and lending money in which corporate stock was assigned as collateral rather than a bona fide sale of stock is sustained by a preponderance of the testimony, and, since $90 interest on $100 for six months was exacted, the contract was usurious. Appeal from . Sebastian Chancery .Court, Fort Smith District; C. M. Wofford, Chancellor ; affirmal. Cravev„9, Cravens & Friedman, for amiellant. • Thomas C. Pitts, for appellee. George • TV: Dodd, for intervener.
466 TISDALE' V. • MANESS: 1192 . J... Appellee Maness brought 'this action against Appellant to cancel certain promissory notes and for the release.of certain collateral executed and delivered by the • former, to the latter. He alleged that . he became indebted to appellant .in, the sum of $100 for borrowed money on or about January 1, 1935, and that appellant required bim to execute six notes of $20 each due one each month; .and .one .note for $70 dile: six 'months after date ;. that. $5 of • each $20 payment was to apply on the principal and $15 for interest ;. that at the .end . of six months . he'Would have .paid . $30 on the prineipal.and. the $70 note then coming . due, 'if paid,. would cancel the debt. In other . words, 'he was to. pay $15 interest •per• ,month for the use of the $100 borrowed.- •He also' alleged that he deposited with appellant ..as collateral: to Said notes , a certificate for .17 shares of.preferred stock of the Tribune Ptiblishing Company of the par, value, of $100 , per share, which he :assigned in blank. He .prayed,a cancellation , of the notes as•.usurious and for a . return of, said stock ,ceh-tificate.. Appellant .denied ,all the . allegations'.of the .complaint or that any notes ,were ,executed. by .appellee,*.and delivered to him. He alleged that' on December 29,1934, said appellee :came , :to him to. borrow money, he ,being a money lender, and that he refused to make a loan,• but purchased said stock for a cash consideration of $375 paid to said appellee, and the stock was thereupon assigned to him. Appellee' Annie Deuber, a judgment creditor of 'Maness, intervened ,in .the action and claimed a paramount lien on said stoCk by . virtue of her judgment on which execution had been' issued and 'levy 'made. Trial resulted in a. decree cancelling ,said notes as .usurious, cancelling the. assignment . of said stock certificate and orderihg a; surrender 'thereof to the clerk . of the' court. Alse a lien was -fixed 'on said stock in favor 'of s * aid inter-Vener,. and Same was ordered sold by tbe CommissiOner if not paid in twenty days. Principally; a . questiOn of fact involved on this appeal, appellant contending that the preponderance 'of the evidence is contrary to the'findings and decree of tbe court, at least when measured by , the Clear and convincing rule which, it is, 'contended, iS required to support' a
I • TISDALE V. MANESS. 467 'finding 6f: usury. .Theissne is,::•Did Maness borrow $100 'froth a•ppellafit. and exeCute and deliver the notes' :above Mentioned and aSSign.said•ste* • certificate as• collateral security •theref or r, or did Ma11 10S5 sell appellant his Stock? If . •he transaction •was • one . of.•borrowing • and. lending money, as.contended by . Maness, then the transaction .was grossly nsurions, as it exacted.the payment of:$90 interest on a loan of $100 for six months. If, on the.other hand, •there .was an :aetual bona fide• side of said steek, as 'contended by:appellant, then n6 : question of usury:is involved, as the element of lending and borrowing is absent. As said by the late Chief Justice Hart in Home Bldg. & Savings Ass'n v. Shotwell, 183 Ark. 750, 38 S. W. (2d..) `.` This . ..court has •niformly recognized that borrowing and lending of . money is indispensable to constitute usury; but that, no-matter what the form of the contract maybe, : mo device or shift,intended to evade the usuty laws will be upheld. The court has . also recognized 'that, *hilei,an exotbitant puce will net of itself . consti-usury,, yet it is, a :citcumstance : to be : considered in determining whether:the transaction:was a bona fide sale of property or . waS'intended for a coVer for usuty. -It has been frequently 'iudicially stated that' Ofie . -Of 'the Most usual forms of UsUrY i§ a 's preteUded sale of goOds or other ptoperty.'' , S . • • .• , • • . -Appellee..Maness testified yery . positively that he execnted the' notes 'above mentioned and assigned the stock fey , a 'lean of $100 ;' that 'aftef deducting certain : iiniOuitts he e! \Ved appellant be 'teCeiVed a Cheek for $57.50, drawn on the.,City : National:13m*, aUd deposited $40 of said amount to his credit in said bank on the: same:day; .exhibiting a duplicate deposit slip . for said amount. The bank records showed that ap'pellant,'s 'account , was charged with a check for $57.50 on the same day,' althOugh bothhe and his bOokkeeper testified that Mt check fer that amount was drawn by him on that date to MatiesS . ot any one else. They both futther . testified-the AranSaction : Ny asa sale and: Purchase of the steel( and that theamouut NVas 'paid to : Maness- in 'caSh, less'his • indebtedness:/, We think fhe .findiug of the cella is suppottedbr the preponderande ..Of the: testimony . :: Other: facts::and edt-
468 [192 cumstances tending to support same are in evidence, but we think it unnecessary to set them out. We are also of the opinion that a preponderance of the testimony is sufficient, because the vital question at issue is whether the transaction was one of borrowing and lending of money, or whether the sale of property, which is a question of fact to be established by the weight of the eVidence. There is no dispute between Maness and the inter-vener, Annie Deuber. The decree is accordingly affirmed.
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