Case ID: lock-rev-cas_1/html/0552-01.html
Source: Caselaw Access Project
Author: {"author": "Per Franklin and Bockee, Senators.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Rapelye, appellant, v. Anderson, respondent; 4 Hill, 472.
    Reported 9 Paige, 483.
    
      Usury on Sale of Bond and Mortgage.
    
    Appeal from Chancery. Bill filed to set aside a contract on the ground of usury. A bond and mortgage for $3000, payable in one year from date, with interest to become due half-yearly, and on which over five months’ interest had accrued, were assigned absolutely by the holder for $2600, in order to raise money. The assignment stated the consideration paid by the assignee to be $3000, and contained a covenant that so much was due and owing on the bond and mortgage. At the time of executing the assignment, the assignor also executed to the assignee a bond with surety conditioned that the mortgagor should pay the $3000, together with the interest, by the day appointed for that purpose in the securities assigned.
    The Chancellor held, that the transaction was usurious, and a mere device to evade the statute, (of 1837,) and decreed the securities to be given up and cancelled. On appeal,
    The Court of Errors reversed the Chancellor’s decree, holding that the transaction was on its face, a mere sale of a chose in action, unconnected with a loan, and therefore not usurious.
   Per Franklin and Bockee, Senators.

The assignee’s right of recovery upon the bond of guaranty, would be limited to the actual amount paid for the bond and mortgage, notwithstanding the consideration expressed in the assignment.

Decree reversed; 12 to IE