Wilmington daily commercial., 1875-12-07
Tine uJstiry Laws.

FURTHER DECISIONS BY THE CouRF-wHAr CON-
sTIrUrEs usuRY, AND THE IMpossIBILIIY OF RE
MOVING THE TAINT.
The trial OF the assumpsis case OF Jacob
Baekhus Us Wm. Ii. II. Clark, afforded another
opportunity for the court to lay down some in
terestng points in relation to usury. First
stating the points i'll the case, the court ad-
dressed the jury I'D follows
The first question for your consideration is
whether the first note made by John G. Clark,
payable to the order Of VIM. I'll. II. Clark and by
him endorsed, was an accommodation note for
the benefit of the maker, without anv value or
consideration moving from the payee and indor-
ser. III there was no value secured, and no COLI
slderation moving from the payee and endorser
1t was undoubtedly an accommodation note and
according to the evidenceif you believe the tes-
timony Of John @. Clark. there was no indebted
ness on his pnrt to the paYee and endolser, ana
no value secured
Tho next question is whether John @. Clark
sold tho note to McLear ~ Son, and whether he
secured from him higher rate of interest than
sX per cent. per annum. He tells you they did,
and that they charged him one and II quarter
per cent per month, aud that tho amount he se-
cured was S15 less than the amount of the note,
which was equal to fifteen per cent per annum.
Now, gentlemen, if you believe this testimon''
and these facts are so rs testified to by John L.
Clark, the transaction as between these parties
was usurions one under our statute, Which
have just read to you, and the note then in tlle
hands of McLear d Son become and WAS tainted
and absolutely void, and no recovery could be
Lad on 1t as between any of these parties and
tue rule is that where action lies as between
the parties to the note none can be maintained
by subsequent holder OF it, ls has been so de-
clded by this court in the case of Brook vs.
fierce, aud also in a more recent case, Ceaden
VI. Webb. IL was ruled i'll those cases that as
accommodation notes Were without coDsdora-
ton, no action lies at the suit OF such payee and
endorser, and that the purchaser OF such note
bY duOtner person from the maker AmOUut,up
to Il loan by tho purchaser to the maker, and the
rule being as | have stated it, that where the
parties TO note cannot be sued by each 9th :,
no subsequent holder of the note can mant9
an action against either the maker endorser.
THO ruling in those cases. presume, is not
questioned
Bat the plaintiffs counsel taking the ground
that Backhu5 was an innocent JOlte dip pur-
chaser Of the lirst note in question from McLear
Y Son, without notice or amy knowledge of the
tlsurious character OF the transaction between
the prior parties, and on he ground he insists
that upon principles Of law, the rights and inter
est OF The plaintiff arc not and cannot be affected
by tho taint of usuly which attached to the note
IN the hands of McLear Il Son,
rom whom he purchased it.
SENSE of knowledge on the part of the plaintiff
of tie usurious character Of the note when pur-
chased by him, he called to the witness stand
Mr.. Nlclear. How far his Testimony went to
establish the fact is for your consideration.
i'Ati hphIiciuciif We say " lOH tHdt WiEbthti
he had or had not such notice or knowledge is
perfectly immaterial. The note being tainted
with usury in the hand of the McLear sit passed
from them 10 Backhus with the faint
upon it, vitiate1 and made void by it, and it re-
NAMED upon it and followed it wherever and in
To whomsoever bands it went, and no statement
Representations that McLear might have made
TO Backus whom he purchased it could cleanse it
IRON or wipe out the taint it had upon it when
IN the hands of the AIcLears. The transaction
was usurious in its inception, and the note there
by made invalid and absolutely void, and no art
OF the parties to the usulous transaction could
move or inspire it with new life in the hands of
II subsequent holder, whether he purchased it
"ith or without knowledge of its usurious char
acter.
1t has been said in the argument that if this
be the law, it will be prejudica and rlinous to
the commercial business of the State that no one
would be safe in purchasing notes. Tho answer
10 Tins argument ID that when Il note is thrown
INTO the market for sale, purchasers can easily
ascertain what the character of the paper il,
whether it is an accommodation paper or legiti-
mate and properly negotiated and business like
paper. Ii this is not the law the statute forbid
ding usury would be very imperative, and but
little more than dead letter upon the Statute
Book.
Now, gentlemen, think have said all that l
can say, or that is necessary for me to say to
enable you to arrive at proper conclusion as
10 the law applicable to the case, and in con-
eluson have only TO say that if yon should be
satisfied from the evidence you have that the
lirst note bearing date the 18th of March, 1876
made by John O. Clark, at six months for $500,
payable to the order of W. H. H. Clark, and
by him endorsed, was accom-
modation note without consideration, if enable
tie maker to raise money; and that he sold 1t to
Mcl4ear Son, being endorsed by the payee
and that they charged him higher rate of inter
est than six per cent per annum, or in that pro-
portion, and that the note OF the 10th of Sep
tember, 1873, was given by the same maker and
endorser, was renewal of the first note, and Sc
cured by the plaintiff in substitution thereof
Your verdict should be for the defendant, but if
you should not be satisfied of those facts it
should be for the plaintiff.
Verdict for the defendant Spruance for
dant.