Court Opinion

ID: 5461050
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:36:36.01965+00
Date Added: 2024-06-11T08:32:53.231034
License: Public Domain

By the Court, Miller, J.
The usury alleged by the defendant consisted, first, in dating the note as of the same time as the deed executed by the plaintiff and the heirs of Humphrey P. Jones deceased to the defendant; second, in including in the note the sum of twenty-nine dollars more than was authorized under the agreement made by the plaintiff and Catharine A. Knapp, by which, in consideration of David *524Jones entering into and signing the article of agreement for the sale of the farm and the settlement and distribution of the estate, they agreed to release and set over to the said David Jones, out of their equal one sixth part, a sufficient amount so that when added and included with said Jones' one sixth part, after the payment of all the debts, it would make up seven hundred dollars for said Jones' share.
As to the date of the note, it appears to have been agreed upon at the time it was made and delivered. At the time when the plaintiff signed the agreement, no time was fixed for the payment of her share, and the subsequent insertion of a time was without her knowledge, cons'ent, or authority, and would not be binding upon her. Although there is some evidence introduced to prove that the plaintiff was not to have interest, yet she swears it was understood by her and the defendant that her share was to draw interest from the date of the deed. The note was dated back, and provided for interest, by the assent of both the parties; and without some positive evidence to establish that this was intended as a cover for a usurious transaction, such an inference can not be drawn. Even if there be a conflict of testimony, on this point, as the referee has found against the defendant, it is conclusive on the subject.
The defendant had been in possession of the farm for some time prior to the execution of the note, and there would seem to be a propriety in dating the note on the same day as the deed.
As the contract provided no time of payment, at the time it was signed by the plaintiff, it was open for negotiation and arrangement. It is evident that the plaintiff was not aware that any alteration had been made, and in claiming interest she did not intend to demand more than she was entitled to. In order to constitute usury, both parties must be cognizant of the facts which make out the usurious contract. (Aldrich v. Reynolds, 1 Barb. Ch. R. 43.) Such clearly was not the *525case in reference to the date of the note, and I think usury-can not be established, on that ground.
Was there usury in allowing the defendant seventeen dollars or thereabouts, instead of forty-six dollars and sixty-seven cents, which it is now claimed should have been allowed ?
By the agreement entered into by the plaintiff and Catharine Knapp, David Jones’ share was to be the sum of $700. Jones was liable, under the agreement, to pay his share of one half the debts, which the evidence shows was $300, making $60 for him to pay. Deducting this sum from Jones’ share, and it would leave $666.66, and a deficiency of $93.34, to be made up by the plaintiff and Catharine Knapp. The plaintiff paid only $17, towards this amount, instead of $46.67, which was the amount due under the agreement with Jones.
It does not exactly appear how the amount was fixed at $17, but there is evidence to show, and it is an established fact in the case, that this amount was agreed upon and allowed by the plaintiff, and the same amount by Mrs. Knapp for David Jones’ share.
The defendant testifies that at the time when the note was made and delivered, he claimed that $46.67 was coming to David under the agreement to make up his share of $700. That the plaintiff claimed that David did not desire it, and that the plaintiff must call it $17, instead of $46.67, and she would give him a year more to pay the amount coming to him, by the agreement. The defendant objected to the note being for more than he owed, and the plaintiff said she was going to give him a good chance to pay it, and she must have that for waiting. The plaintiff, on the other hand, swears that nothing was said about the $46.67 to be paid out of her share on account of David, and that all the deT fendant claimed was $16.66.
There is no direct contradiction between the parties, as to whether the defendant claimed any more than was allowed *526him on account of David’s share. The referee has found that the sum of' $17 was agreed to be paid by the plaintiff, and it was thus settled. Under such circumstances, with the proof at least doubtful whether the amount was fixed for the purpose of making a usurious contract, I think that the defendant has failed to make out a corrupt and usurious agreement which would vitiate the note. The burthen of proof was upon him, and unless it is fully established he can not succeed with such a defense. Even if the statement of • the defendant be correct and uncontradicted, in a case where the parties appeared to be negotiating in reference to an arrangement of a contract for the sale of real estate, I have great doubts whether usury is satisfactorily established. The defendant’s evidence does not show very satisfactorily how the debts were paid, or what they amounted to, in detail. He merely states the aggregate; and although he insisted, as he testifies, upon the larger sum, yet he seems to have regarded the matter as open for negotiation, and finally yielded to the plaintiff’s claim. In fact, he appears to have settled with Mrs. Knapp, who was liable to pay as much, upon the same basis.
As it was assumed, at the time the note was given, that the plaintiff was to settle with the defendant for the amount secured to David Jones under the contract, there is no force in the position taken by the plaintiff that she was under no legal obligation to pay the defendant. The defendant was a party to the first contract, and by the last one the plaintiff released and set over to David Jones out of her share, a portion, so as to make up $700 for him after all the debts were paid. I think the legal effect of this was, to allow a deduction from the plaintiff’s share. But whether such was the arrangement or not, the parties agreed to it at the time the note was given, and the plaintiff is not now in a position to repudiate that arrangement.
I am entirely satisfied that there was no usury in the making of the note. At most it was an error in not allowing *527the defendant for the full amount due him ; and the question arises whether this error is now open for adjustment and correction.
[Albany General Term,
May 2, 1864.
The evidence is conclusive that the debts were $600, which shows that the amount allowed was less than it should have been, and that there must have been some mistake or misapprehension on the settlement, if there was not a usurious contract. It is true that the amount of debts was not fixed and adjusted by the contract itself. At the time, it was not determined what the debts were, and it was left open to be ascertained afterwards. The plaintiff and the defendant undertook to settle all matters between them, and the result of the settlement was the note in question. Although the defendant claims that he surrendered a portion of his claim for the purpose of getting a longer time, this is denied by the plaintiff. It would appear, then, that the defendant voluntarily assented to the lesser amount, and the note was made accordingly. As the defendant has agreed to the lesser sum, and upon a final settlement assumed that sum was the correct amount, I am inclined to think that he is hound by this settlement. More especially should this be the rule when the defendant does not ask a reformation of the instrument on the ground of mistake, and a correction of the error in the settlement.
I have entertained some doubt whether the amount of the alleged error should not be deducted from the recovery; but as the parties have agreed to the arrangement made, and the note was executed under such an agreement, I do not well see how the settlement can be disturbed. At the time the defendant gave the note, he should have insisted upon his rights. As he did not do so, and chose to accede to the plaintiff’s claim, as to the amount, and to execute his note to her upon that basis, I think he is bound by it.
The judgment entered upon the referee’s report must therefore be affirmed, with costs.
PeeJcham, Miller and Ingalls, Justices.]