Where the contract between the parties makes no provision for interest, if any is allowed it must be given at the legal rate;72 and the same is true where the contract provides for interest at the legal rate or without mention of any rate. Where, however, the contract provides a rate of interest different from the legal rate, there has been much difference of opinion, especially in the case of interest-bearing commercial paper, on the question whether the legal rate or the conventional rate should be enforced after the maturity of the instrument. Logically it seems clear that unless the contract can be understood as impliedly providing that interest shall be at the conventional rate after maturity as well as before, or a renewed contract can be inferred from subsequent acts of the parties, the legal rate must be given as damages for the non-performance of the agreement.73 Many courts, however, interpret such contracts either

119, 25 L. Ed. 571; United States v. Butler, 114 Fed. 582; Wood v. Claiborne, 82 Ark. 514, 102 S. W. 219, 11 L.R.A. (N. S.) 913, 118 Am. St. Rep. 89; Talbot v. Commercial Nat. Bank, 129 Mass. 67, 37Am. Rep. 302. 70 Florence Cotton, etc., Co:, v. Louisville Banking Co., 138 Ala. 588, 36 So. 456,100 Am. St. Rep. 50; Arapahoe County v. Denver, 30 Colo. 13, 69 Pac 586; Georgia R. R. A B. Co. v. Smith, 83 Ga. 626, 10 S. E. 235; Haven v. Foster, 9 Pick. 112, 19 Am. Dec 353; Corse v. Minnesota &e. Co., 94 Minn. 331, 102 N. W. 728; 8eoond&T.S. P. Ry. v. Philadelphia,

51 Pa. 465; Kean v. Landrum, 72 8. C. 556, 52 S. E. 421; Hall v. Graham, 112 Va. 560, 72 S. E. 105; Ann. Cas. 1913 B. 1257; OHerrin v. Milwaukee County, 67 Wis. 142, 30 N. W. 239.

71 See supra, Sec. 1413.

72 Thus a savings bank has been held liable for interest at the legal rate for wrongful detention of a bank book although the rate which the bank paid on its deposits was less. Wegner v. Second Ward Savings Bank, 76 Wis. 242, 44 N. W. 1096.

73 In the following eases the statur tory rate only was held allowable as meaning that the conventional rate shall be paid until the obligation is discharged,' or hold that rate to be the just measure of compensatory damages.74 Of course, if it is clearly expressed that the conventional rate is to be paid after maturity as well as before, there can be no doubt of its allowance.75 after maturity. Cook p. Fowler, L. R. 7 H. L. 27; Goodchap v. Roberts, 14 Ch. D. 49; Equitable Trust Co. p. Western Pacific R., 244 Fed. 485; Kitchen v. Branch Bank, 14 Ala. 233; Harbison v. Hammons, 113 Ark. 120, 167 8. W. 840; Casey v. Gibbons, 136 CaL 368, 68 Pac. 1032; First Ecclesiastical Society v. Loomis, 42 Conn. 570; Jefferson County p. Lewis, 20 Fla. 080; Trippe v. Wynne, 76 Ga. 200; White's Adm'r, v. Curd, 86 Ky. 191, 5 8. W. 553; Eaton p. Boisson-nault, 67 Me. 540, 24 Am. Rep. 52; Brown p. Hardcastle, 63 Md. 484; Holbrook v. Sims, 39 Minn. 122, 39 N. W. 74, 140; Ashuelot R. R. v. Elliott, 57 N. H. 397; Ferris v. Hard, 135 N. Y. 354, 32 N. E. 129; Pryor p. Buffalo, 197 N. Y. 123, 90 N. E. 423; Delaney r. Canadian Pac. R. Co., 21 Ont. 11; Pearoe v. Hennessy, 10 R. I. 223 (but see Silverman v. Shattuck, 33 R. I. 67, 80 Atl. 184); Earle v. Owings, 72 8. C. 362, 51 S. E.960.

74 Farmers' L. & T. Co. r. Northern Pac. R., 94 Fed. 454; Greenhaw v. Holmes, 8 Aris. 94, 68 Pac. 537; Crockett v. Mitchell, 88 Ga. 166, 14 8. E. 118; People v. Getsendaner, 137 111. 234, 34 N. E. 297; Shaw v. Rigby, 84 Ind. 375, 43 Am. Rep. 96; Hand v. Armstrong, 18 la. 324; Rew v. Independent School Dtst, 125 la. 28, 98 N. W. 802, 106 Am. St. 282; Fonter r. Forster, 129 Mass. 550; Downer v. Whittier, 144 Mass. 448, 11 N. E. 585; Warner p. Juif, 38 Mich. 662; Meaders v. Gray, 60 Miss. 400, 45 Am. Rep. 414; Macon Co. v. Rodgers, 84 Mo. 66; Hallam v. Telleren, 55 Neb. 255, 75 N. W.

560; Monnett v. Sttirges, 25 Oh. St. 384; Overton v. Bolton, 9 Heisk, 762, 24 Am. Rep. 367; Wade p. Pratt 12 Heisk. 231; Parks p. O'Connor, 70 Tex. 377, 8 8. W. 104; Gage o. MoSweeney, 74 Vt. 370, 52 Atl. 969; Evans r. Rice, 96 Ya. 50, 30 8. E. 463; Morris v. Baird, 72 W. Ya. 1, 78 8. E. 371; Thorn p. Smith, 71 Wis. 18, 36 N. W. 407; Wyoming Nat. Bank v. Brown, 7 Wyo. 494, 53 Pac. 291. The Federal courts apply the rule locally prevalent. Cromwell p. Sac County, 96 U. 8. 51, 24 L. Ed. 681; Ohio v. Frank, 103 U.S. 697, 26 L. Ed. 531; United States Mtge. Co. 0. Sperry, 138 U. 8. 313, 34 L. Ed. 969, 11 Sup. Ct. 321; Equitable Trust Co. v. Western Pacific R., 244 Fed. 485 (aff'd 250 Fed. 327, 162 C. C. A. 397, 246 U. 8. 672, 62 L. Ed. 932, 38 8. Ct. Rep. 423). But where no local rufe to the contrary exists, they allow the statutory rate. Brewster v. Wakefield, 22 How. 118, 16 L. Ed. 801; Holden v. Freeman's, etc., Trust Co., 100 U. 8. 72, 25 L. Ed. 567; Massachusetts Benefit Association p. Miles, 137 U. 8. 689, 34 L. Ed. 834, 11 Sup. Ct 234. See also Massachusetts v. Western Union Tel. Co., 141 U. S. 40, 11 Sup. Ct. 889, 35 L. Ed. 628.

75 Ex parte Fewings, 25 Ch. Div. 338; New Orleans p. Warner, 175 U. 8. 120, 147, 44 L, Ed. 96, 20 Sup. Ct 44; Casteel p. Walker, 40 Ark. 117, 48 Am. Rep. 5; Winsted Sav. Bank p. New Hartford, 78 Conn. 319, 62 Atl. 81; Augusta Nat. Bank p. Hewins, 90 Me. 255, 38 Atl. 156; Lamprey v. Mason, 148 Mass, 231, 19 N. E. 350; Hamer p. Rigby, 65

In many States usury statutes limit the rate of interest which may be contracted for before maturity. And though a provision for interest after maturity in excess of the rate permitted by a usury statute is held not to be usurious since the debtor may by payment of the debt avoid payment of interest after maturity,76 the question nevertheless remains, in view of the invalidity of penalties, how fat a provision that after maturity the rate of interest shall be increased is enforceable. Unless the increased rate is extreme the provision is held not penal,77 except in a few States.78 A provision, however, that in case of default a higher rate shall be paid from the creation of the obligation, not merely from its maturity, has generally been held penal79 The case has been distinguished where the agreement provided for a rebate of interest in case of prompt payment at maturity instead of an increase of interest from the creation of the obligation in case of default at maturity. The former provision has been held not penal.80