Chew v. District of Columbia

42 App. D.C. 410, 1914 U.S. App. LEXIS 2301

• Court: District of Columbia Court of Appeals
• Decided: November 2, 1914
• Docket: No. 2689
• Status: Published

Opinion

Mr. Chief Justice Shepard

delivered the opinion of the court:

The testimony was sufficient to show that defendant was engaged in lending money at a greater rate of interest than 6 per centum per annum, and the single question is, Was this a lending upon security ?

In Reagan v. District of Columbia, 41 App. D. C. 409, the court said of this act of Congress: “It is a remedial act, and should be liberally construed with the view of giving force and effect to the intent of Congress. In arriving at that intent, it is proper to consider the evils sought to be regulated, and the advisability of bringing the wrong, in all of its ramifications, within, the limitations of the act. To this end, the intent of the lawmakers must be gathered from the law as a whole, and ■not from garbled extracts. This is not a usury statute as applied to the regulation of interest charges for the use of money in legitimate commercial transactions, but an act licensing, under limitations and restrictions, the loaning of money in small sums upon personal security.”

■ It was also said: “In special statutes of. this sort, where a particular remedy is sought or a wrong is to be restrained, the word 'security’ has been applied in its broad sense to include a promissory note. . . . The present act, however, specially defines the securities included within its terms as 'any security of any kind, direct or collateral, tangible or intangible.’ Without stopping to inquire whether the term 'intangible’ security is broad enough to include every evidence of debt, we have no doubt of its including any evidence of debt executed by a debtor which will make the payment of money more assured or more easily enforced. . . . Congress is here dealing with a subject which it is seeking to regulate generally and without apparent exception. To this end broad terms have been used to express its comprehensive intent. The court, therefore, in interpreting the act will not close its eyes to that which, as a matter of common knowledge, led to the enactment of the law.”

The manifest purpose of the act was to prohibit the lending of money upon any unlawful form of indebtedness or security. The terms of the law are broad enough to punish all lending of money of the kind described, without regard to the particular form which the debt may be made to assume. It is apparent that the borrowers understood these receipts as notes delivered to the lender for the purpose of securing the debt. They were executed by the parties and delivered for the purpose of preserving evidence of the loan, although in the form of a receipt. The scheme was intended for the purpose of evading the law, and cannot be permitted to have that effect.

We are of the opinion that the Police Court was right and that its judgment must be affirmed. Affirmed.