Case Name: Kate Carr, Appellant, v. Georgiana Taylor, Respondent
Court: New York Supreme Court, Appellate Term
Jurisdiction: New York
Decision Date: 1900-02
Citations: 30 Misc. 617
Docket Number: 
Parties: Kate Carr, Appellant, v. Georgiana Taylor, Respondent.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 30
Pages: 617–619

Head Matter:
Kate Carr, Appellant, v. Georgiana Taylor, Respondent.
(Supreme Court, Appellate Term,
February, 1900.)
Usury — Purging a transaction of usury.
A usurious contract and security may be so far purged of usury by the subsequent acts of the parties as to become valid and en-forcible, but this can only be done by cancelling the security and giving in its place a new obligation for the sum which should be paid, excluding all usury.
Appeal by the plaintiff from a judgment of the Municipal Court of the city of ¡New York, borough of Manhattan, rendered in favor of the defendant, upon a trial had before the court, without a jury.
The nature of the action and the material facts are stated in the opinion.
Ryan & Richards, for appellant.
Mansfield Compton, for respondent.

Opinion:
Giegerich, J.
The action is to recover $86.50, a balance claimed to be due upon a promissory note made by the defendant to the plaintiff, for $300, payable in one year from the date thereof, viz.: February 1, 1897. The answer set up the defenses of usury and an accord and satisfaction.
It appears from the evidence adduced upon the trial, that, when the note in suit was given, the plaintiff was receiving from the defendant, at her establishment, instruction in the art of dressmaking, pursuant to an agreement in writing, by the terms of which the defendant agreed to employ the plaintiff, after the first three months' tuition, at a stipulated salary. The plaintiff claims that the sum for which the note was given, was delivered to the defendant to secure the faithful performance of the conditions of the said contract on her (plaintiff's) part; but her testimony, in this respect, is contradicted by that of the defendant, who testified that said sum was loaned to her upon condition that she would pay plaintiff twenty-seven dollars and sixty-five cents for the use thereof for one year, and that a credit for said last-mentioned sum was then allowed the latter upon a " fifty-five dollar course of lessons in the Taylor System of dressmaking." While the plaintiff denied the making of such usurious agreement, the following receipt signed and delivered by her to the defendant, at the time of the delivery of the note in controversy, shows' conclusively that she is mistaken in her version of the transaction:
" New Yoke, Feb. lsi/97.
" In consideration of Miss Garr loaning to Mrs. Taylor the sum of Three hundred $300 00/100 Dollars, Mrs. G. Taylor gives Miss Kate Carr $27.65 as a bonus or interest for the use of said $300 00/100 for one year from date. Said $300 00/100 secured by G. Taylor's note Given Miss Carr, Feb. 1st. 1897, for one year.
" (Signed) Kate Cabe."
This writing clearly evinces the intention of the parties to pay on the one hand, and to receive on the other, interest in excess of the legal rate. The entire transaction is thus tainted with usury, and, hence, the note in question is void. 1 R. S., chap. 4, tit. 3, § 2-5; 2 R. S. (Banks Bros.' 9th ed.), 1854, 1855. While it is true that a usurious contract may be purged by the subsequent acts of the parties so as to become valid and enforceable (27 Am. & Eng. Ency. of Law, 964), yet the proof, to my mind, does not afford any ground whatever for such a finding. Certainly no such effect can be properly claimed for the agreement contained in the following writing:
" New Yoke City, May 27, 1897.
" Agreement made between G. Taylor and Kate Carr in view of a certain contract made between G. Taylor and Kate Carr on Feb. 1st, 1897 and in satisfaction, this Mrs. G. Taylor agrees to employ another dressmaker in the place of the present one who is not satisfactory to Miss Carr to instruct Miss Carr in the art of dressmaking until Miss Carr wishes to take a position at a salary or goes in business for herself. Mrs. G. Taylor agrees to advance Mi hr Carr $3.00 weekly while she Miss Carr is taking her dressmaking lessons, said amount to be returned to Mrs. G. Taylor on or about Feb. 1st, 1898.
" (Signed) Mbs. G. Taylob.
" (Signed) Katie Cabe.
" Witness:
" (Signed) G. Colon."
It is well settled that an usurious security can only he made good by cancelling it and the giving of a new obligation for the real sum which ought to be paid, excluding all usury. Miller v. Hull, 4 Den. 104; Jacobsen v. Bradley, 49 Hun, 152. It is not even pretended that anything of the kind took place in the case at bar, and the very fact that the plaintiff retained possession of the note and brought suit thereon, precludes the idea that it was regarded by either party as cancelled or destroyed as an obligation by the agreement last above set forth. In this view it is unnecessary to pass upon the question whether such contract constitutes, as claimed, an accord and satisfaction.
The judgment should, therefore, be affirmed, with costs.
Beekman, P. J., and O'Gorman, J., concur.
Judgment affirmed, with costs.