RATIONAl:. LIFE INS. CO.
NATIONAL LIFE INS. CO.
(Cirouit Oowrt, D. iowa. May 18,1881.) 1. !NsURANCE-LoAN-USURY. Where a contract for the loan of money and an agreement for insurance upon the life of the borrower are blended together in one and the same transaction, and the proof shows that the policy' of insurance was taken and the premium paid' in advance in consideration of the loan, the transaction is usurious if the sum so paid as pre,. mium is greater than the interest allowed by law.
" MCCRARY, C. J. Where a contract for the loan of money and an agreement for insurance upon the life of the borrower are blended together in one and the same transaction, and the proof shows that the policy of insurance was taken and a premium paid in advance in consideration of the loan, and that such consideration was over and above the interest allowed by law, the transaction is usurious. Ins. Go. v. Kittle, 1 McCrary, 234." It is not necessary in such a case to show that the prell!iums charged were unreasonable. It will be presumed that there was in the transaction of insurance a profit to the insurance company, the lender; and if, independently of the premium paid in advance, the maximum rate of interest has been charged and taken, the insurance and the .payment of a premium in advance, if intended as a condition precedent to and a further consideration for the loan, will make it usurious. The profit accruing to the lender from the insurance transaction in such a case will he presumed to he something, and, whether great or small, being in excess of the lawful interest, it is usury. We have, therefore, only to consider whether tlJe proof in this case Shows that the policy of insurance upon the life of the respondent was required as a condition precedent to the loan and constituted an additional consideration therefor. This question must, in view of the evidence, be answered in the affirmative. It seems that the proposition was distinctly made to the respondent that '.if he would apply for a $10,000 life policy the company would loan him $2,000, and the
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proposition was assented to. The company afterwards insisted upon a modi:ijcation of the agreement so far as to make the amount of the loan $1,000 instead of $2,000; but it is, I think, clear from the proof that no loan of any amount would have been made if the respondent had refused to take the insurance and permit the premium ($285) to be retained in advance from the sum loaned. It is eq,ually clear that the respondent would have deolined to take the insurance but for the offer with it, and asa part of' the same transaction, of a loan. Indeed, it is manifest that the insurance was demanded as an additional consideration, alld more or less valuable, for the loan. This being tlw case, clearly, within the rule above stated, the complainant is entitled only to decree for balance due on the principal of the debt, and must pay the costs.
Co. v. MORENO and others.
August 18, 1879.)
(Oircuit Court, D. Oregon.
STIPm.ATIoN FOR AN ATTORNEY FEE.
A stipulation to pay a reasonable attorney fee to the plaintiff in case a promissory note or other contract is not performed according to its terms, and the party entitled to demand such performance is compelled to enforce it by law, is just and valid.
Motion for Judgment. Gyru8 Dolph, for plaintiff. Thomas N. Strong, for defendants. DEADY, D. J. On September 1,1877, the defendant Moreno, with four others as his sureties, executed and delivered a bond to the plaintiff in the penal sum of $1,000, conditioned for the payment of all indebtedness on the part of Moreno to the plaintiff; and on November 23, 1877, said Moreno, with two others as his sureties, executed and delivered another bond of the like amount and condition to the plaintiff. These actions are brought upon these two bonds to recover an amount alleged to be due from said Moreno for goods, wares,