Case Name: HENRY COTHEAL AND DAVID COTHEAL v. JEREMIAH W BLYDENBURGH ET AL.
Court: New Jersey Court of Chancery
Jurisdiction: New Jersey
Decision Date: 1845-06
Citations: 5 N.J. Eq. 17
Docket Number: 
Parties: HENRY COTHEAL AND DAVID COTHEAL v. JEREMIAH W BLYDENBURGH ET AL.
Judges: 
Reporter: New Jersey Equity Reports
Volume: 5
Pages: 17–19

Head Matter:
HENRY COTHEAL AND DAVID COTHEAL v. JEREMIAH W BLYDENBURGH ET AL.
1. A, living in New York, sells to B, also living in New York, a tract of land in New Jersey, and takes his bond for part of the consideration money, with seven per cent, interest, and his mortgage on the lands conveyed, to secure the payment of the bond. The mortgage is not usurious.
2. The exchange of the papers in New Jersey, at the proper record office, will not make the mortgage usurious; they having been executed and acknowledged in New York, and a sufficient reason for not exchanging them there being shown.
This was a bill for the foreclosure of a mortgage. The complainants had sold to J. W. Blydenburgh, a tract of land in this state, and taken his bond for a part of the consideration money, with seven per cent, interest, and his mortgage on the lands sold to secure the payment of the bond.
Both parties resided in New York, and the papers were executed and acknowledged there, but were exchanged in this state, at the clerk’s office of the county in which the lands are situated.
A mortgage on the same lands, from Blydenburgh to Wads-worth, a witness in the cause, was executed and acknowledged in New York, at or about the time when the mortgage to the complainants was executed and acknowledged.
Wadsworth testified that he met Blydenburgh at the complainant’s office in New York, a few days after the mortgages were acknowledged, for the purpose of having the mortgages delivered, and of Blydenburgh’s getting his deed. That at this time, there was a proposition made as to the exchange and delivery of the papers. That one of the complainants objected to delivering the deed, unless he could be sure that the mortgage to them was put on record before the mortgage to the witness. That he was present at a subsequent interview between the same parties, or some of them, in relation to the same subject, at the office of Mr: Feltus, a counselor-at-law in New York, who acted as counsel for the complainants; and that at this interview it was understood that Blydenburgh and one of the complainants should • meet, with their papers, at the place of record in New Jersey, the next day, for the purpose of having the papers recorded in the proper order. That it was agreed that the witness’ mortgage should be second.
The defence set up by the answer is, that the mortgage was usurious.
The cause was heard on the pleadings and proofs.
Leupp, for the complainants,
cited 17 Johns. Rep. 511; 1 Green’s Ch. R. 44; 1 P. W. 606; 3 Green’s Rep. 328; 2 Kent’s Com. 460, 461.
J. W. Blydenburgh, pro seipso,
cited 8 Leigh’s Virg. Rep. 93; 3 Iredell 528; 6 Paige 627; 4 Peters 205.

Opinion:
The Chancellor.
This is not the case of a borrower and lender residing in New Jersey, making a contract for the loan of money, and going into New York to exchange the papers, and reserving seven per cent, interest. All the parties to this contract resided in New York at the time it was made. The bond and mortgage both truly state the parties, obligor and obligees, and mortgagor and mortgagees, as of the city of New York. The papers were executed in New York; the mortgage is acknowledged in New York. It* is clearly a New York transaction.
A, residing in New York, lends B, also residing in New York, a sum of money, and takes his bond for it, payable in one year, at New York interest, seven per cent. To secure the bond, the borrower gives the lender a mortgage on lands in New Jersey. It would be a singular application of the lex loci rei sitae, to say that, because this New York contract is secured by a mortgage on lands in New Jersey, where the legal interest is six per cent, only, it is void for usury, or even to say that the lender shall receive only New Jersey interest. 3 Atk. 727, Stapleton v. Conway.
Another ground relied on by the defendant was, that the bond and mortgage, though executed, witnessed, and acknowledged in New York, were actually delivered at the clerk's office in New Brunswick, New Jersey, and not in New York. I do not see that the mere fact of the exchange of the papers in some place out of New York deprives it of the character of a New York contract. But in this case, the reason why it was done is manifest. It was done by arrangement between the parties, and by the advice of the complainants' counsel, in order that the complainants might be sure that their mortgage found its right place on the record.
As to the rate of interest in New York, it is sufficiently proved in the case, if it were necessary to prove it. But it was not necessary. The defence is usury, by the law of New Jersey. This defence cannot be made in relation to a New York contract.
The defence is overcome by showing that this was a contract not subject to the New Jersey statute. If the contract was usurious in New York, it was for the defendant to show it, in pleading and proof.
The complainants are entitled to the relief sought by their bill. The usual reference will be ordered.
Order accordingly.
Affirmed, 1 Mal. Ch. 631.
Cited in Dolman v. Cook, 1 McCar. 62; Campion v. Kille, 2 McCar. 231; Andrews v. Torrey, 2 McCar. 357; Atwater v. Walker, 1 C. E. Gr. 43; Leake v. Bergen, 12 C. E. Gr. 361.