Court Opinion

ID: 3582379
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:33:16.730682+00
Date Added: 2024-06-11T13:54:19.532597
License: Public Domain

But a single question is presented in the case. Sampson was the owner of a valid bond and mortgage, on which was due the sum of $3,000. He presented for payment, and Adams, the maker, was embarrassed to meet the demand. To enable him to accomplish his purpose, an agreement was made between Kellogg and Adams, to the effect that Adams would buy from Sampson the bond and mortgage in question, and would extend its payment for five years. At the same time it was made a condition of said purchase, that Adams would buy of Kellogg a certain other property, called the Howe property, for the price of $2,000, *Page 32 
giving his bond and mortgage to secure the same, and would also pay fifty dollars, being a portion of the discount that Kellogg had been obliged to pay, to raise the money needed. The Howe property was of the value of $1,000 only. The plaintiff now seeks to enforce the Sampson mortgage, and Adams sets up the defense of usury upon the facts thus stated.
In an action to enforce the Howe mortgage, the defense would be available. In an attempt to enforce any agreement collateral to that mortgage, dependent upon it or forming a part of it, the same rule would apply. Such are the cases cited by the appellant's counsel, and which are De Witt v. Brisbane
(16 N.Y. 508); Palmer v. Pell (3 Seld. 328); Schroepel v.Corning (5 Denio, 236). In De Witt v. Brisbane, an illegal agreement had been entered into, in violation of the restraining laws of this State, in regard to the circulation of small notes, and a mortgage, valid between the parties, had been assigned to secure its performance. In an attempt to foreclose this mortgage, it was held that no title passed to the transferee, and that this was a defense to his action of foreclosure. In that case, the illegal transaction was the basis of the plaintiff's claim. Before he was entitled to recover, he was compelled to show his illegal contract with the other party, and to establish the balance due by virtue of it. This he did, and the court held that it would not lend its aid to enforce an illegal transaction; that the assignment was collateral simply to such illegal contract, and that the attempt to enforce that must fail also.
If the plaintiff here was obliged to claim through the usurious contract, and his right to enforce the mortgage depended upon his bargain with Adams, the principle would be the same, and his action would fail. He does not so claim, nor is he bound to establish or in any manner to refer to that contract, to maintain his cause of action. His contract with Adams was distinct and separate from his contract with Sampson. Sampson was not bound to have assigned the mortgage, although Adams may have devised or bargained for it. It could only be assigned by an arrangement which *Page 33 
should be satisfactory to and accepted by him, Sampson, Adams having nothing to do with that part of the transaction. Such, in law, was the state of the case, and such, in fact, was the result. The plaintiff made his own arrangement with Sampson, by transferring to him other securities satisfactory to him, and with which Adams had no concern. Sampson then executes a formal assignment of the mortgage, by which its title was transferred. This created a contract between the parties to it, of whom Adams was not one. It is upon this contract with Sampson, separate and distinct in its nature and substance, and its parties, from the bargain between Kellogg and Adams, that this action is brought.
Considering it as the enforcement of a contract originally and legally made between Adams and Sampson, and legally transferred thereafter to Kellogg, and not dependent upon or seeking aid through the transactions between Kellogg and Adams, the question presents no difficulty.
The judgment should be affirmed, with costs.
Affirmed. *Page 34