Court Opinion

ID: 6598927
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:05:59.548331+00
Date Added: 2024-06-11T15:57:56.957186
License: Public Domain

By the Court,

Dixon, C. J.
The court is of opinion that the judgment, below should be affirmed, on the ground that the defendant by extending the time of payment of the note to Goodman, the principal, absolved the plaintiff from responsibility as surety. The agreement to extend is clear enough, for the defendant himself testifies to it, or to facts which are incapable of any other interpretation.
But it is objected that as the plaintiff executed the note in form as principal and not as surety, parol evidence is inadmissible to show his real relations to the other contracting parties, and that to allow it, is to vary the tenor of the note and change the plaintiff’s liability from what it appears on the face of it. If this were so, it would constitute an insurmountable objection to the evidence. But we do not think such is its effect. We agree with the writers of the notes, 2 American leading cases, 312 to 315, sustained by Bell vs. Banks, 3 Scott’s New Rep.; 503; Harris vs. Brooks, 21 Pick, 195; Carpenter vs. Kings, 9 Metcalf 511; Bank of Steubenville vs. Hoge, 6 Ham., 17; Branch Bank vs. James, 9 Ala., 949; and Grafton Bank vs. Kent, 4 N. H. 221; that the discharge of the surety by time given to the principal stands on the ground of fraud, arising from an injury to the subsidiary relations existing between the *672parties, and does not involve the substitution of a different contract for that which has in terms been entered into with the creditor. It does not vary the effect of the undertaking, but it shows that the creditor who enters into a valid agreement to give time to the principal, knowing him to be such, and that the other joint maker is bnta surety; violates his faith impliedly pledged to the surety not to interfere with his relations so as to impair his legal rights or diminish his remedies against the principal.-
It is also further objected, that the agreement giving time in this case was void for usury. It is a general principle running through all the decisions, that the penalties of the law against usury are aimed exclusively against the lender; that he alone is regarded as in the wrong, whilst the borrower is considered wholly innocent It follows hence, that, usurious agreements are not so absoutely void that no rights whatever can be founded upon them. They are void only at the option of the borrower and those in privity with him. Not being within the pale of the law, he may satisfy or repudiate at his pleasure. Dix vs. Van Wyck, 2 Hill 522; Sands vs. Church, 2 Seld., 347. But not so with the party taking the usary. Looked upon as the author of the wrong, he is precluded upon general principles of public policy, from setting it up to defeat any rights which the other party or those in legal privity with him, may claim by virtue of the contract. He stands in this respect, upon the same footing as the guilty party in case of fraud. The injured party may repudiate, but the guilty never. LaFarge vs. Herter and Dillenback, 5 Seld., 241; Draper vs. Trescott, 29 Barb., 401.
Judgment affirmed.