Court Opinion

ID: 6951956
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:33:02.826495+00
Date Added: 2024-06-11T16:08:06.606750
License: Public Domain

Breese, Justice, dissents. This cause was originally argued at the April Term, 1864, and the foregoing opinion was filed as of that term. At the April Term, 1865, a rehearing was granted upon the suggestion of questions which were not presented to the court at the former hearing. On the rehearing, it was insisted by Mr. L. B. Wagner, on behalf of the appellee, James H. Huntoon, with whom was Mr. S. W. Brown, that to enter a decree requiring James Harvey Huntoon to pay to the Woodworths the usury in this note and deed of trust, would be clearly inconsistent with the case made by complainants’ bill, and if so would be erroneous. Citing Colton v. Ross, 2 Paige Ch. 397; Lloyd v. Brewster et al., 4 id. 537; Beebe v. Bank of New York, 1 Johns. 559; Mitford’s Pleadings, 38; Wilkin v. Wilkin, 1 Johns. Ch. 117; Grimes v. French, 2 Atk. 142; Darmer v. Fortescue, 3 id. 132; 2 Peters, 595. Counsel further urged: The complainants examined James Harvey Huntoon as a witness in the cause, and this operates as an equitable release to the defendant, and there can be no relief against him, and cited 3 Greenleaf’s Evidence, § 316; Wrymouth v. Boyer, 1 Vesey, 417; Lewis v. Owen, 1 Ired. Eq. 93; Palmer v. Van Dorn, 2 Edw. Ch. 193; Bradley v. Root, 5 Paige, 633; Lingan v. Henderson, 1 Bland, 263. The statement, in the opinion in this case, that Huntoon admitted the usury in his answer, is a mistake. Huntoon neither admits nor denies it in his answer, but testified to it when called as a witness by complainant. Mr. B. F. Parks and Messrs. Leland & Blanchard, for the appellants, contra. Mr. Chief Justice Walker delivered the opinion of the Court: This case comes before us at this term on a rehearing. After careful reflection and reconsideration of the ground upon which the former opinion was based, we see no reason to change our views as there expressed. But upon questions now raised which were not then considered, we have arrived at a different conclusion from that announced on the former hearing. In granting relief against usury collected, as the record shows it was in this case, we would not in the least modify the former decisions of this court, but place it upon the ground that the payment was not voluntary, but was compulsory and so that the defense could not be made. In the former cases the court proceeds upon the ground that a debtor who has voluntarily paid usury is, after the whole debt is paid, estopped from suing and recovering it back. While in a case like this it is involuntary, and by the transfer of the note before its maturity to a bona fide purchaser without notice, the defense is cut off. Nor can a debtor in such a case resort to a court of equity for relief by injunction of the usurious portion of the debt, as by the assignment before maturity the assignee acquires the note freed from all defense, either legal or equitable. As the payment is compulsory, and by the' assignment of the note the payee has, to say the least, obtained an unfair advantage, a court of equity will give relief, and it may be that the maker has a remedy at law for money paid for the use of the payee. It is now urged, that it appears from the evidence, that complainants had made an assignment of their property for the benefit of creditors, and if so, they have no right to recover the usury back, but that the assignees would be. entitled to recover. It is true, that Wagner incidentally states in his testimony that they had made an assignment and were insolvent. To whom, when, or what was assigned, he does not state. The record affords no evidence, if an assignment was made, that it embraced this claim. This evidence is too meagre and unsatisfactory upon which to reject the claim to recover back the usury. It is insisted that James H. Huntoon does not admit that the note contained usury, and that it was not otherwise proved. He does not m terms admit it, but clearly does by implication. The bill charges that the transaction was usurious, and in his answer he says, that Mary P. Huntoon “ was a bona fide holder and owner thereof, and had no notice of usury or any other defense to said note.” The answer was obnoxious to an exception for failing to answer the. allegation in the bill, but no exception was taken to it. It might perhaps, as evidence, have been .regarded as such an admission as would warrant the conclusion that the note did contain usury, as charged in the bill It is likewise insisted at this time, that James H. Huntoon, being called by complainants as a witness on the hearing, they are precluded from taking a decree against him. Hnder the general chancery practice, there are cases and circumstances that preclude such a decree, but there are other cases where the courts have stricken out the evidence of the party, when there was other evidence, and permitted a decree to pass. And if necessary in this case to the support of the decree, we would incline to hold that Huntoon’s evidence might be stricken out, and a decree rendered on his answer. But by a recent statute, adopted on the 20th day of February, 1861 (Sess. Laws, 11), it is provided that after making and filing an affidavit, either party may call on the other to testify. It declares that in cases where there are two or more plaintiffs or defendants, the opposite party may call either or all of the plaintiffs or defendants as witnesses to the fact mentioned in the affidavit. We find no affidavit in the record, but we will presume that it was waived unless the contrary appears. This statute, it is true, declares that whenever a party to any original suit pending in a court of record, upon contracts express or implied, shall file an affidavit, he may resort to this character of evidence. While a bill in equity may not be embraced, in terms, in the act, such a case as this is clearly within its spirit, as there is an implied promise by the payee, when he sells a note and cuts off the defense of usury, that he will repay the usury to the maker. However, upon a careful examination of the bill, we find, that, as it is framed, the relief cannot be granted. If properly framed in other respects, the relief could have been granted under the general prayer. But the bill proceeds upon the ground that the purchasers of the note had notice of the usury and were not bona fide holders—Mary P. Huntoon being charged with notice—and that Stephens purchased after the maturity of the note. The evidence fails to sustain these allegations, but the evidence does show that James H. Huntoon did sell the note so as to cut off the defense of usury. The bill makes one case and the proof another. Had the bill been properly framed the relief should have been allowed. But we feel ourselves unable to reverse the decree of the court below, but it is so modified that the bill stand dismissed without prejudice, and appellant pay the costs of this court. Decree modified.