Court Opinion

ID: 6413894
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:54:41.900844+00
Date Added: 2024-06-11T15:51:28.244950
License: Public Domain

Bigelow, C. J.
The ruling of the court was erroneous. The note did not become an operative contract, binding on the defendants, until it was negotiated by the payee to the broker, who advanced upon it a sum less than the amount due thereon, after deducting lawful interest. Previous to such negotiation, no action could have been maintained upon the note by any one. Such advance of money was in legal effect a loan, and not a sale of a negotiable note in the hands of an indorsee. If a greater rate of interest than six per cent, was reserved upon it, when it was thus negotiated, the contract was usurious, and the defendants -were entitled to a deduction of threefold the amount of the interest so unlawfully reserved, under Gen. Sts. c. 53,, § 4, even in the hands of a bona fide indorsee. Sylvester v. Swan, 5 Allen, 134. Kendall v. Robertson, 12 Cush. 156. The provision in St. 1863, c. 242, that usury between the payee and maker of a promissory note payable on time shall be no defence as *408against a bona fide indorsee of the note, taking it before its maturity, does not apply to transactions which took place before that statute was passed. North Bridgewater Bank v. Copeland, ante, 139. Exceptions sustained.