Court Opinion

ID: 5250731
Source: CourtListenerOpinion
Date Created: 2022-01-06 18:12:41.50296+00
Date Added: 2024-06-11T08:27:56.611251
License: Public Domain

Kruse, P. J. (dissenting):
The provisions in the policy which make the subject of the insurance void if incumbered by a chattel mortgage mean a valid outstanding chattel mortgage. (Forward v. Continental Insurance Co., 142 N. Y. 382; Lycoming Fire Ins. Co. v. Jackson, 83 Ill. 302.) If this chattel mortgage is tainted with usury, as the jury have found, the law declares it to be void. Courts would say it. is only voidable. (Williams v. Tilt, 36 N. Y. 319; Chapuis v. Mathot, 91 Hun, 565; affd., 155 N. Y. 641.) That simply means that he may do as he likes about paying it. A mere stranger may not intervene to raise the question of its invalidity, but the plaintiff and those in privity with him may so do at any time before it is paid.
It is not voidable in the same sense as an infant’s contract is voidable. That may be ratified. But not so of a contract void for usury. Such contracts are against public policy. They cannot be ratified or validated without being purged of usury. If the chattel mortgage was usurious it was void from its inception, and not merely when the plaintiff elected to so treat or regard it. It required no affirmative act of disaffirmance or repudiation to make it so. Even if the question of intention is to be regarded as a factor, I think his omission to advise the insurance company of the chattel mortgage when the policy was issued is some evidence of his intention to treat it as void.
I vote for reversal.
Order affirmed, with costs.