Question 251. - In the case of a man borrowing $100 for twelve months at, say 6 per cent., if he pays the note on the last day of grace, can interest be legally collected on the three days of grace?

Answer. - If a man gives a note at twelve months for $100 and interest at 6 per cent., he is liable for the interest for twelve months and three days.

Note for "$1,000 at Six Years with Interest at Six Per Cent. Per Annum " - Interest Due only at the ExPiration Of The Term.

Question 252. - A gives B a note for $1,000 at six years with interest at six per cent, per annum. B claims interest is payable yearly. A claims the note with six years' interest is due at the expiration of the term. Which is correct?

Answer. - A is correct in his contention that the six years' interest is due at the expiration of the term. The note does not state that the interest is payable yearly, it merely sets out the rate of interest, which is in this case six per cent, per annum. If the interest were payable yearly, it would be necessary to state so. A parallel case would be where a loan secured by a mortgage is payable on the due date, no mention being made,(a,s is usually done in the case of mortgages) as to the dates of the payment of interest. Interest in this case must be calculated at simple rates. See Morse on Banking. Section 309.