INTEREST, IN LAW.—In England and Ireland, when a debt has been for some time due, there is no obligation imposed on the debtor by the common law to pay any interest whatever, though the sum has been fixed and often demanded. The creditor can always sue for his debt, which is his proper remedy, but he derives no benefit from giving time to his debtor. Therefore, if interest is to be paid, thus be, as a general rule, by virtue of express agreement. Nevertheless, there has always been one or two exceptions this rule. Thus, by the usage of merchants, it has always been usual, when an action has been brought to recover the amount of a bill of exchange or promissory note, for the • jury to add interest from the time it was due; but even this was not a matter of course— it was a matter of discretion for the jury, and was generally withheld when there was delay in bringing the action. Another exception existed in the case of money due upon an award by an arbitrator, in which case interest is clue from the day when the award was made. A third exception was in the case of a bond fo•.money, in which case interest was added from the day IC ought to have been paid. And lastly, if a surety had to pay money for his principal, he could recover it back with interest. In all other cases, if there was no express agreement about interest, none could be claimed. If, however, there was a course of dealing between the parties, or a usage affecting a particular trade to give interest, then, without express agreement, this was understood. A recent statute some what amended the above defect of the common law, for by 3 and 4 Will. IV.• c. 42, s. 28, a jury may now add interest at the ordinary rate on all debts or sums certain, which aro made payable under some written instrument at a certain time; and even if not due under a written instrument, then if it written demand has been made, expressly giving notice that interest will be charged from and after the date of the demand, if not paid then, interest will also be due. But even in these last cases it is discretionary in thej'ury to
give the interest, and therefore it is not claimable as a matter of course. As regards com pound interest, it is aprtiori not claimable in any case, except where it has been expressly stipulated for, or where there is in some particular trade a definite e.ustom to pay interest, and such custom must always be proved.
It ought also to be added that the court of chancery has always been in the habit of charging trustees who have misapplied funds with 5 per cent interest on the amount, and also compound interest; but in simple cases of retaining moneys in hand without investing them, they have been charged 4 per cent. Formerly it was prohibited by statute in England to lend money on the security of real estate at a higher rate than 5 per cent; but these statutes have been abolished, and now any person may borrow or lend at whatever rate of interest lie can agree with the other party. Pawnbrokers are allowed to charge interest not exceeding a fixed sum. Sec PAWNBROKING.
In Scotland the law has always been much more liberal in allowing interest to be claimed on outstanding debts, for there the converse principle was acted on, that on nearly all debts whatever, interest was claimable either by statute or by common law, Thus, interest is due on bills of exchange, on the amount contained in a horning or charge to pay, on sums paid by cautioners, on the price of lands sold, on money advanced at request, on the price of goods sold, if the usual time of credit has expired, and generally on all debts which there has been delay in paying.