Opinion
Decided June 10, 1935.
Debtor and creditor — Tender of money before suit — Section 11390, General Code — Ineffective to stop running of interest, when.
Where, after tender and refusal to accept the entire principal and interest due on a promissory note, the money is not set aside to the use of the payee or paid into court as prescribed by Section 11390, General Code, in order to relieve defendant of payment of interest and costs, such tender is not effective to stop the running of interest.
ERROR: Court of Appeals for Hamilton county.
Messrs. Cobb, Schott, Tieman Neyer, for plaintiff in error.
Mr. Peter J. McCarthy, Jr., Mr. Harvey A. Schear and Mr. R.T. Dickerson, for defendants in error.
No pleadings appear among the papers filed.
The suit was apparently upon a promissory note. The defense was an admission of the principal sum due and a claim of tender. There was also apparently a claim for interest paid since the date of tender. The court gave judgment in favor of the plaintiff, who is the plaintiff in error here, for the principal sum due upon the note, $2,730, with interest upon $3,000, at the rate of 7 per cent. per annum from July 25, 1931, to August 17, 1931, amounting to $13.57.
The court further found that the defendant Crumley, upon written authority of the defendant, Eva Brueggeman, as alleged in their cross-petition, had upon July 25, 1931, tendered to plaintiff $3,105, "the entire principal and interest due at the date of tender," and that such tender was refused; that the plaintiff is not entitled to interest after the date of tender; that by mistake Eva Brueggman made subsequent payments of interest in the amount of $270, and that she is entitled to a credit upon the principal due of that amount.
The court was in error in finding that the tender made stopped the running of interest, for granting that the tender included the amount of interest owing at the due date of the note the tender was not completed by being set aside to the use of the payee or by being paid into court. Section 11390, General Code, provides:
"In an action on a contract for the payment of money, if the defendant answers and proves that before the commencement of the action, he tendered payment of the money due thereon, and before trial pays to the clerk the money so tendered, the plaintiff shall not have judgment for more than the money so due and tendered, without costs, and shall pay the defendant his costs."
It is claimed that the payee stated he would not accept a tender in any event. What was said simply amounted to a refusal to accept the money which was actually offered to payee.
The record shows that after tender, the money was again placed in bank, subject to use by the one making the tender, and was not paid into court. The tender was, therefore, not kept open. In the case of McCrea v. Martien, 32 Ohio St. 38, the court at page 42 states:
"The plaintiff had conveyed the land for which the notes were given, to the defendant, who mortgaged the same back to the plaintiff, to secure the purchase-money. The money due on the notes belonged, in equity, to the plaintiff; and though the defendant might hold it for his own indemnity, he so held it as the trustee of the plaintiff. Instead of holding it without use, he put it into his business, and used it as his own, or as if it were borrowed money; and, failing to account for the profits, should, upon equitable principles, be held liable for the use of the money.
"It is well settled by the authorities that, in all such cases, the trustee is chargeable with interest. Powell v. Martin, 8 Ves. 146; Selden v. James, 6 Rand. 464; People v. Gasherie, 9 Johns. 71; Kirkman v. Vanlier, 7 Ala. 217, 230, and cases cited."
See, also, 23 Ohio Jurisprudence, 44, Section 35; 75 A.L.R., note, 369.
We cannot see how the case of State, ex rel. Stuart, Pros. Atty., v. Urschel, 105 Ohio St. 640, 141 N.E. 366, is applicable.
The judgment of the Court of Common Pleas must be modified to conform to the rule applicable, as herein noted.
Judgment modified and affirmed as modified.
MATTHEWS and HAMILTON, JJ., concur.