Page:Federal Reporter, 1st Series, Volume 6.djvu/224

 212 FEDERAL REPORTER. �excess of interest so paid. By the act of May, 1869, it was provided that "the parties to a bond, bill, promissory note, or other instrument of writing, for the forbearance or payment of money at any future time, may stipulate therein for the payment of interest upon the amount thereof at any rate not exceeding 8 per cent, per annum, payable annually." This act took effect and was in force on and after the first day of October, 1869. Prier to the taking^effect of this act, there- fore, the parties could not legally contract for and receive a greater rate of interest than 6 per cent. Having contracted for and received 8 per cent., the excess of 2 per cent, must be deemed and taken as payment made upon the principal, unless the parties, by their subsequent acts, have deprived themselyes of, or have waived, the right to insist upon such application of the excess so paid. And it is claimed by the complainants that the agreement and arrangement of the first of August, 1875, had this effect ; that by this contract there was a full and complete settlement of ail interest which had been paid, and an asoertainment of the amount due up to that date, and the payment thereof, and a payment of the sum of 112,500 of the principal debt, upon the consideration that complainant would release a portion of bis security, and that was done ; and that this was the making of a new con- tract, which shuts out and precludes the defence of usury which before that time had existed. The defendants insist that the agreement and arrangement of the first of August did not have the effect claimed for it by the complainant; and, if it should be held by the court to have such an effect, that the executors had no authority in law to make it. �This leads us to inquire into the nature and character of the transaction of August 1, 1875. Was it a settlement and payment of the excessive interest which before that time had been paid and agreed to be paid? And was the release of a portion of the mortgage promises made in consideration of such settlement and payment? �I have looked through the testimony caref ully, and i think I may safely say that prior to that date no question had arisen ��� �