Court Opinion

ID: 7889667
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:47:25.472304+00
Date Added: 2024-06-11T16:31:52.098972
License: Public Domain

Buchanan, Ch. J.,
delivered the opinion of the court.
Having attentively examined the testimony spread upon this record, we are clearly of opinion that each of the deeds of mortgage set out in the bill of complaint, was given for a grossly usurious consideration.
A number of witnesses appear to have been examined, some of whom swear that they had borrowed money of Neff, the appellant’s testator, at six per cent, interest; others that they had known him to lend money at an interest of six per cent, and had never known him to charge more; others, that they had calculated the interest for him, on notes that he held of others, and always at the rate of six per cent'. One swears that he had himself borrowed money from him at nine percent., and another that he had borrowed from him at twelve per cent.
The two mortgage deeds from Blizzard to Neff are dated, .the first on the 25th April, 1818, and the second on the 25th of May, 1821. Buckingham swears that in June 1829, Neff told him “that he lent no money to any man for less than twelve per cent, interest, and had not done so for many years, and would not do it to any one.” Ogg swears “that Neff told him about twelve or thirteen years ago, that John Blizzard was an honest little man, and was paying him more than twelve per cent, interest.” Merriman swears, that sometime in the year 1818 or 1819, when speaking with Neff concerning Blizzard, Neff raised his hand towards Blizzard’s house which was in view, and not more than a quarter of a mile off and said, “it is the same thing to me, as our neighbour pays me twelve per cent.” And Parish *23swears, that some time in the year 1888, Neff told him, “that George Crutman had been paying him twelve per cent, for twenty years, and that John Blizzard had been allowing him twelve per cent, for fifteen years, which was secured by his notes and his property, and that Blizzard’s debt was secured in the same way, that his, the witnesses was, which was by notes and mortgage of his property.”
It is manifest therefore, independent of the evidence of John Blizzard himself, that whatever may have been the rate of interest at which Neff had loaned money to other persons, (which is not very material to this case,) he was exacting twelve per cent, from Blizzard, and there being no evidence of any pecuniary transaction between them, except the mortgages and the considerations for which they were given, the declarations of Neff must be taken to have had reference to these transactions, and to taint them with usury.
But it is said, that admitting the mortgages to have been given on usurious considerations, Jacobs, who is in possession of the mortgaged premises, by purchase at a sheriff’s sale under a judgment against Blizzard, cannot be permitted to defeat the claim of the appellant, who is seeking to foreclose the mortgages; and for that De Wolf vs. Johnson, 10 Wheat. 367, is relied upon. We had thought differently, but have been driven by the reference to that high authority, to look into the books upon which the opinion delivered in that case appears to have been founded. And with all the deference to which the Supreme Court is so eminently entitled, we have not been able to arrive at the same conclusion.
Indeed as far as the principle is there asserted, that the alienee of a mortgagor cannot avail himself of the defence of usury, to a bill of foreclosure by the mortgagee, that case has since been overruled in the case of Lloyd vs. Scott, 4 Peters’ Rep. 205. Where all usurious contracts are declared by law to be null and void, there can be no recovery either at law or in equity, in a suit instituted upon an instrument infected with usury, if the defence of usury be *24pleaded; the very instrument that is sought to be enforced being utterly void.
Where a mortgage is given on an usurious consideration, the plea of usury, either by the mortgagor or his alienee, is a full defence to a bill in Chancery for a foreclosure by the mortgagee, who goes to enforce a void instrument. But there is a recognized distinction between that, and the case of a mortgagor or his grantee who goes into chancery seeking relief against the mortgage on the ground of usury; which will only be extended to him on his paying or offering to pay the principal and legal interest of the sum due, on the principle that he who seeks equity, to obtain relief must do equity.
By the law of this State, all bonds, contracts, and assurances whatsoever, whereby there shall be reserved an interest above the rate of six per cent, on money loaned, are declared to be “utterly void.”
Here there was an interest of twelve per cent, intended to be secured, and the defendant, Jacobs, having purchased the mortgaged premises, at a sheriff’s sale regularly made under a judgment against Blizzard the mortgagor, and this being a bill by the mortgagee for a foreclosure, we think he is entitled to avail himself of the defence of usury, which is insisted upon in the answers against this mortgage, so tainted and void.
DECREE AFFIRMED WITH COSTS.