Court Opinion

ID: 5460642
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:35:15.431856+00
Date Added: 2024-06-11T08:32:52.090869
License: Public Domain

Morgan, J. (dissenting.)
In legal effect the grantees took the conveyance subject to the payment of the mortgage in question. The amount included therein was deducted from the purchase price, and was to be paid in any event. They *367were to pay it by paying this mortgage, unless the grantor should procure it to be discharged on the ground of usury. In an action upon his bond, the grantor attempted to establish the defense of usury and failed. He is therefore estopped from setting up the defense to the mortgage, by a former adjudication of this court upon the very point in question. Being estopped himself from setting up the defense, his grantees now purpose to make it for him. But they really have no interest in the question, it being wholly immaterial to them whether they pay this mortgage or the substituted mortgage. It is the same debt, and both mortgages operate but as a single lien upon the premises. The only effect of a judgment in their favor, setting aside the mortgage in question for usury, would be to make them liable upon the second mortgage for the same demand. And a judgment against them in this action would, by the terms of the agreement, relieve them from the payment of the second mortgage. They are therefore strangers in interest to the controversy as to its validity.
As a general rule, no one but the party who made the usurious security, or those standing in legal privity with him, can avoid it. A mere stranger to the transaction has no such right. (Dix v. Van Wyck, 2 Hill, 522.)
But these defendants are not only without interest in the question, but they have contracted with Dillaye to occupy a position of entire neutrality. It was doubtless optional with Dillaye whether he would make this defense or not. If he chose to waive the usury it did not lie with his grantees to interfere with his election. Ho court would compel Dillaye to defend the mortgage at the instance of the defendants; nor could they maintain an action against the plaintiff and Dillaye to procure it to be canceled for usury. It would be a good answer to such an action, that by the terms of the contract the whole interest in that question was reserved to Dillaye.
Although Dillaye has not waived the defense, he has been beaten on it, and cannot litigate it again. Hor can the de*368fendants litigate it; because, 1st, they have no interest in it: and 2dly, they cannot do for Dillaye what he would not be permitted to do for himself.
[Oswego General Term,
July 14, 1863.
The judgment should be affirmed.
New trial granted.
Allen, Mullin, Morgan and Bacon, Justices.]