Court Opinion

ID: 5459642
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:31:03.429263+00
Date Added: 2024-06-11T08:32:42.178860
License: Public Domain

Johítsoít, J. (dissenting.)
The question presented by this case is, whether an usurious agreement, to extend the time of the payment of a note, or other obligation, .can be enforced against the creditors, where such agreement is proved, and insisted upon as valid, by the other party.
The statute declares all such agreements void. Hot void in favor of one party, and valid against the other; but void absolutely and unconditionally against every party, and in all courts. Being void, how can the courts enforce them ? Certainly they cannot, unless courts have some extraordinary power to make valid what the legislature have said should have no validity. The duty of the court is to administer the law, and whenever a contract is proved before it, which the statute declares void, it is the duty of the court so to pronounce it. Disregarding the statute is not administering it. I had supposed this question entirely settled in the case of Vilas v. Jones, (1 Comst. 274.) If however that case is not to be regarded as authority upon this question, the opinions of both the eminent judges, delivered in the case, ought to have no little weight upon this question. I think no judge, who took part in the decision of' that case, doubted the soundness of the views expressed in the opinions upon this point. But, upon principle, how can any one be discharged from a valid obligation, by an agreement which is a nullity, and the enforcement of which the statute will not permit, when its vicious character is once shown ? The proposition seems to me, I confess, nothing short of a legal absurdity. It seems to *409be supposed that the subsequent case of La Farge v. Herter, (5 Selden, 241,) is an authority to show that the plaintiff will not be permitted to say that the agreement to extend is void, by reason of its usurious character. But that case, in my judgment, has no possible bearing upon the question here presented. There the question was whether the usurer should be permitted to bring the evidence of his own turpitude before the court, for the purpose of avoiding an agreement apparently valid. And the court held that he should not be allowed to prove the usury.
But no such question arises here. Here the usury is proved by the other side. There is no question as to the character of the agreement. The court sees that it is corrupt, and usurious, upon the defendant’s own showing. And now, the question is, can, the court pronounce such a contract obligatory, and of sufficient force in law, to discharge the defendant from a valid promise to pay ? I think not, as long as the statute remains unrepealed. It is precisely the exception stated by Buggies, Ch. J., in his opinion in La Farge v. Herter. He says : “ A party to a fraud is estopped from setting it up for his own advantage; but if his opponent alleges and proves it as part of his own case, the guilty party will then be entitled to the benefit, while he incurs the disadvantage resulting from such a state of things.” Here, however, there is no question of estoppel. It may be that we should hold the plaintiff estopped from proving the usurious character of the agreement to extend, for his own advantage in the action. But the other party having proved it, the plaintiff is not estopped from asking us to look into the statute, and give some heed to its provisions; nor are we estopped from applying the statute to the corrupt agreement, and declaring it void, on the plaintiff’s suggestion. It is a great and radical mistake to suppose that this statute was designed as an instrument to be used in the hands of the needy and compliant borrower, only. It had its origin in far higher considerations of public policy; and the commonwealth has an interest in hav*410ing the statute fairly applied to every such contract, whether it operates, in the particular case, in favor of the borrower or lender. The statute was intended to prevent borrowing, as •well as lending, at usurious rates. As the agreement to extend is clearly usurious, I see no other way than to say what the statute says, that it is void, and consequently had no effect upon the defendant’s liability on the note.
[Cayuga General Term,
June 6, 1859.
T. R. Strong, Smith and Johnson, Justices.]
Judgments reversed.