Case Name: Bliven v. Lydecker et al.
Court: New York Supreme Court, General Term
Jurisdiction: New York
Decision Date: 1889-12-10
Citations: 7 N.Y.S. 867
Docket Number: 
Parties: Bliven v. Lydecker et al.
Judges: 
Reporter: West's New York Supplement
Volume: 7
Pages: 867–868

Head Matter:
Bliven v. Lydecker et al.
(Supreme Court, General Term, Second Department.
December 10, 1889.)
Usury—Exacted by Agent.
Usury exacted by an agent in effecting a loan will not invalidate an obligation given to secure the loan, unless the lender knew of and. assented thereto.
Appeal from special term, Rockland county.
Action by Albert A. Bliven against Smith Lydecker and others. The complaint was dismissed, and plaintiff appeals.
Argued before Barnard, P. J., and Pratt, J.
Garrett Z. Snider, for appellant. Irving Brown, for respondents.

Opinion:
Barnard, P. J.
The action in this case is one for foreclosure of a mortgage, and the defense to the same is based upon the usury exacted from the borrower by John W. Schuler, acting as agent for his wife, Margaretta Schuler. The mortgage in this case was executed March 25, 1879, and dated February I, 1879, and has been transferred by a subsequent assignment to the plaintiff, Bliven. The testimony on behalf of the defendant tends to show that the mortgage, amounting to $4,000, was made up of the following items:
Rote dated December 12,1878, - $1,000 00
Interest 3 months and 13 days, 20 00
Rote dated February 15, 1879, - 1,800 00
Interest 1 month and 10 days, 14 00
Rote dated January 18, 1879, - 200 00
Interest 2 months and 7 days, 2 59
Ten per cent, on $4,000, 400 00
Cash from Mr. Schuler, 563 38
Total sum included in mortgage, - - - $4,000 00
There is no evidence in this case bringing the details of the loan home to Mrs. Schuler, or showing that she took any part, active or passive, in effecting the same. The testimony of Smith Lydecker, for the defense-, expressly states that he never heard her name mentioned in connection with the transaction until John W. Schuler said that he wished the mortgage to be made out in her name. In order to render an obligation by way of mortgage or otherwise-void on account of usury, the recent decisions in this state seem to demonstrate that it is necessary to clearly establish knowledge and assent on the part of the lender, and that no usury on the part of an agent is fatal to the validity of an obligation unless such assent is shown beyond a reasonable doubt. In the case under consideration, there is nothing in the evidence to justify the findings in support of such assent. Stillman v. Northrup, 109 N. Y. 473, 17 N. E. Rep. 379, cited and approved in Baldwin v. Doying, 114 N. Y. 453, 21 N. E. Rep. 1007; Philips v. Mackellar, 92 N. Y. 34. In Stillman v. Northrup, cited above, the court says: "It is not sufficient for the-defendants merely to show that plaintiff's agent took and exacted the $50 as a condition of the loan, but it was incumbent upon them to show that he took the $50 with the knowledge and assent of the plaintiff, so that she, at least by acquiescence, became a party to the usurious exaction." The tendency and spirit of the cases above referred to seem to overrule the decision in Wyeth v. Braniff, 84 N. Y. 627, and to establish a more just and equitable rule than that there laid down. In Stillman v. Northrup the court further decides-that any subsequent knowledge, after the date of the making of the loan by the lender, in regard to usury on the part of the agent in connection with the-making thereof, even if proved, makes no fatal objection to the force and validity of the obligation. The judgment, therefore, should be reversed, with, costs. All concur.