This is an action brought in the district court of Woodbury county, Iowa, under §§ 5197 and 5198 of the Revised Statutes of the United States, relating to national banks, to recover the sum of $16,250, the amount of interest alleged to have been unlawfully charged and collected by the defendant bank.
The original petition alleged as follows:
'The plaintiff claims of the defendants, and each of them, the sum of $16,000, as money justly due plaintiff from defendants, on account of unlawful and usurious interest knowingly and unlawfully taken from the plaintiff within the seven years last past.
'The plaintiff further alleges that during said time he had various and numerous business transactions with the defendant bank; in all said transactions defendant charged and exacted a greater rate of interest for the use of moneys had and received by plaintiff from the defendants than the law recognizes or permits a national bank to charge for the use of money.'
The petition also alleged that the books and accounts wherein said transactions were kept were in the possession of the defendant, and 'that the plaintiff has no itemized statement of the account between him and the defendant,' and that therefore he was unable to incorporate in the petition a statement of the accounts or bill of particulars.
The petition also alleged that there was due plaintiff the sum of $250, deposited by him with the defendant, which had never been drawn out or paid to him.
Upon demurrer to the petition the court ordered it to be more specific, 'so far as to require the plaintiff to state his cause of action for usury in one count, and also to state his cause of action for a deposit in a separate count, and also to state the amount claimed as usury that was paid within two years next prior to the commencement of this cause of action.' The petition was thereupon amended.
We are only concerned with the first and second counts, which alleged the usury. It was alleged in the first count that on or about the 27th of May, 1889, the plaintiff commenced doing business with the bank in the ordinary way between the bank and its patrons, and continued to so do business with it until it closed its doors on or about the 27th of August, 1896. That during that time the bank knowingly charged him with a greater rate of interest than allowed by the laws of Iowa, which amounted to more than $1, but the exact amount of which he was unable to state, because the books containing the transactions were in the possession of the bank.
That on the 24th of February, 1890, the bank added the amount of usurious interest charged by it to the legitimate indebtedness of plaintiff, and included both and the sum of $2,000 advanced to plaintiff, making a total of $10,000, in a promissory note bearing interest at the rate of 10 per cent per annum, and as collateral security for said note plaintiff assigned to the bank all of his equity in eighty-one contracts, covering 3,290.57 acres of land in Plymouth county, Iowa.
That on the 4th of March, 1890, plaintiff executed to the bank a non-negotiable promissory note for $28,000, to cover all of his indebtedness to the bank, to wit, $14,500, in a draft, to pay on certain railroad lands; the $10,000 note herein mentioned before, and the unlawful and usurious interest knowingly reserved and charged prior thereto, and continued in said $10,000 note aforesaid, and continued and renewed in the $28,000 note.'
To secure said note plaintiff executed a mortgage of the land aforesaid.
'That the above note and mortgage, which were made upon the 4th day of March, 1890, did include the $10,000 illegal and unearned note, and interest to the amount of $17.10; and which said note and mortgage were made to date back and to bear date of March 1, 1890, thereby increasing the rate of interest on the $10,000 note to about 14 per cent per annum; and which said illegal, unlawful, and usurious interest was knowingly reserved and charged by the defendant, and included in and is a part of the $28,000 note aforesaid.