twenty-six, to secure unto the said William S. Sears,' on or before the seventh day of October, one thousand eight hundred and twenty-seven, the payment of the sum of two thousand dollars, with interest thereon, at the rate of seven per cent., payable semi-annually, have been decreed by the court of appeals in the last resort in all cases of law and equity to be usurious and utterly void. It is, therefore, on the 16th day of April, 1835, ordered, on motion of Henry W. Green, of counsel with the said William Roberts, Junior, that the said bond and mortgage be delivered up to be cancelled. MS. case.

23. Afterwards, on a bill filed by the assignee of Sears to set aside the return of the sheriff of Essex county, and enforce the original decree, a plea in bar was filed, setting up the decree declaring the mortgage of Sears to be void; but overruled by Chancellor Pennington as being no bar to the latter bill, and that the original clain was not infected with usury by the usurious mortgage taken by Sears. Matthews v. Roberts, 1 Green Ch. R. 338.

24. C, a resident of New Jersey, applied in the city of New York to V, who was also a resident of New Jersey, for a loan of money, which was agreed to be lent in New York, at seven per cent. per annum; and afterwards, to secure the loan, mortgage was executed in New Jersey, upon lands in that state, but reserving six per cent. interest only in the mortgage. Interest was successively paid, at seven per cent., on the loan, as per agreement, and such payments. were endorsed upon the mortage. On bill filed to foreclose the mortgage, and usury set up as a defence, Held, per Chancellor Dickinson, that the endorsement of seven per cent. interest upon the mortgage was no evidence of seven per cent. interest having been received or taken upon the mortgage; but that such receipt was evidence of that rate of interest having been paid upon the loan made in New York, and the mortgage, having called for but six per cent., was lawful. And the decree was for complainant, for principal and New Jersey interest. Varick's Ex'rs v. Crane, MS. case. Furnished by the Hon. P. Bentley, Mayor of Jersey City.

Mr. Sears informed me, that the defendants set up a sale of stock as forming part of the alleged usury contained in the mortgage, But that would have made no difference, as the statute of usury set out by the defendants was that of New Jersey, under which seven per cent. was as much usury as the sale of stock could have been; and such appears to have been the opinion of the Court of Appeals, from the language used.

SECTION XXII.

NEW YORK.

1 Revised Statutes, page 771, Title III, Chap. 4, Part 2. Of the interest of money.

SECTION 1. The rate of interest upon the loan or forbearance of any money, goods or things in action, shall continue to be seven dollars upon one hundred dollars for one year, and after that rate for a greater or less sum, or for a longer or shorter time.

SECT. 2. No person or corporation shall, directly or indirectly, take or receive in money, goods or things in action, or in any other way any greater sum or greater value for the loan or forbearance of any money, goods or things in action, than is above prescribed.

SECT. 3. Every person who, for any such loan or forbearance shall pay or deliver any greater sum or value than is above allowed to be received, and his personal representatives, may recover in an action against the person who shall have taken or received the same, and his personal representatives, the amount of the money so paid or value delivered above the rate aforesaid, if such action be brought within one year after such payment or delivery.

SECT. 4. If such suit be not brought within the said one year, and prosecuted with effect, then the said sum may be sued for and recovered with costs, at any time within three years after the said one year by any overs er of the poor of the town where such payment may have been made, or by any county superintendent of the poor of the county in which the payment may have been made. SECT. 5. See act of 1837.

SECT. 6. Every person offending against the provisions of this title, shall be compelled, to answer on oath any bill that may be exhibited against him in the Court of Chancery, for the discovery of any sum of money, goods or things in action so taken, accepted or received in violation, of the foregoing provisions, or either of them.

SECT. 7. Every person who shall discover and repay or return the money, goods or other things so taken, accepted or received, or the value thereof, shall be acquitted and discharged from any other or further forfeiture, penalty or punishment, which he may have incurred by taking or receiving the money, goods or other thing so discovered and repaid, or returned as aforesaid.

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SECT. 8. Whenever any borrower of any money, goods or things in action, shall file a bill in chancery for a discovery of the money, goods or things in action, taken or received, in violation of either of the foregoing provisions, it shall not be necessary for him to pay, or offer to pay any interest whatever on the sum or thing loaned; nor shall any Court of Equity require or compel the payment or depositof the principal sum, or any part thereof, as a condition of granting relief to the borrower, in any case of a usurious loan forbidden by this chapter.

SECT. 9. For the purpose of calculating interest, a month shall be considered the twelfth part of a year, and as consisting of thirty days; and interest for any number of days less than a month, shall be estimated by the proportion which such number of days shall bear to thirty.

SECT. 10. Whenever in any statute, act, deed, written or verbal contract, or in any public or private instrument whatever, any certain rate of interest, is or shall be mentioned, and no period of time is stated for which such rate is to be calculated, interest shall be calculated at the rate mentioned, by the year, in the same manner as if the words " per annum" or " by the year," had been added to such

rate.

Session of 1837, page 486, chapter, 430. An act to prevent usury. Passed May 15, 1837.

The People of the State of New York, represented in Senate and Assembly, do enact as follows:

SECTION 1. The fifth section of title three of chapter four, part two, of the Revised Statutes, is hereby amended, so as to read as follows:

SECT. 5. All bonds, bills, notes, assurances, conveyances, all other contracts or securities whatsoever, (except bottomry and respondentia bonds and contracts,) and all deposites of goods or other things whatsoever, whereupon or whereby there shall be reserved or taken, or secured or agreed to be reserved or taken, any greater sum or greater value for the loan or forbearance of any money, goods or other things in action, than is above prescribed, shall be void; but this act shall not affect such paper as has been made and transferred previous to the time it shall take effect.

SECT. 2. Whenever in an action at law the defendant shall plead or give notice of the defence of usury, and shall verify the truth of

his plea or notice by affidavit, he may, for the purpose of proving the usury, call and examine the plaintiff as a witness, in the same manner as other witnesses may be called and examined.

SECT. 3. Every person offending against the provisions of the said title, or of this act, may be compelled to answer on oath any bill that shall be exhibited against him in the Court of Chancery, for relief or discovery, or both.

SECT. 4. Whenever any borrower of money, goods or things in action, shall file a bill in chancery for relief or discovery, or both, against any violation of the provisions of the said title or of this act, it shall not be necessary for him to pay, or offer to pay any interest or principal on the sum or thing loaned; nor shall any Court of Chancery require or compel the payment or deposite of the principal sum or interest, or any portion thereof, as a condition of granting relief or compelling or discovering to the borrower in any case, usurious loans forbidden by said title or by this act.

SECT. 5. Whenever it shall satisfactorily appear by the admissions of the defendant or by proof, that any bond, bill, note, assurance, pledge, conveyance, contract, security, or any evidence of debt has been taken or received in violation of the provisions of said title, or of this act, the Court of Chancery shall declare the same to be void, and enjoin any prosecution thereon, and order the same to be surrendered and cancelled.

SECT. 6. Any person who shall, directly or indirectly, receive any greater interest, discount or consideration, than is prescribed in the said title, and in violation of the provisions of said title or of this act, shall be deemed guilty of a misdemeanor, and on conviction thereof, the person so offending shall be punished by fine not exceeding one thousand dollars, or imprisonment not exceeding six months, or both.

SECT. 7. It shall be the duty of all courts of justice to charge the grand jury especially to inquire into any violations of the provisions of the said title or of this act.

SECT. 8. Every plaintiff examined as a witness pursuant to the provisions of this act, or any defendant under the provisions of this act, who shall swear falsely, shall, upon conviction thereof, suffer the pains and penalties of wilful and corrupt perjury; but the testimony given by any plaintiff, or the answer of any defendant, made pursuant to the said title or of this act, shall not be used against such person before any grand jury, or on the trial of any indictment against such person.

SECT. 9. So much of title third, chapter fourth, and part second of the Revised Statutes, as is inconsistent with the provisions of this act, is hereby repealed.

SECT. 10. This act shall take effect on the first day of July next.

1. A lends B $687, to be repaid on a certain day, with interest, and B, in consideration of the loan and forbearance, purchases of A 16 shares of turnpike stock, for the sum of $400, when, in truth, the real price of the shares was $250, and gives his bond for the $687, together with the $400 for the stock: the sale of the stock being merely colorable, the transaction is usurious, and the bond void. Rose v. Dickson, 7 J. R. 196.

2. Whether, when a bond is given for the purchase money of lands, at which time the vendor, by his agreement, is to execute a deed to the vendee, and also promissory notes for the interest of the bond, at a higher rate than the legal interest of the place where the agreement is made, such notes are to be considered as usurious, or as constituting part of the price of the land. Quere. Van Shaick v. Edwards, 2J Cas. 355.

3. A contract usurious in its inception cannot afterwards be rendered valid; so, a note given for a usurious consideration will be void in the hands of a bona fide endorsee, without notice of the usury. Wilkie v. Roosevelt, 3 J. Cas. 206.

4. A note endorsed for the accommodation of the maker, and passed by him as security for a usurious loan, is a usurious contract in its inception, as the lender is, in fact, to be considered the first holder of the note. Jones v. Hake, 2 J. Cas. 60. Wilkie v. Roosevelt, 3 J. Cas 66-206.

5. An absolute deed of conveyance of real estate upon trust, to sell and pay certain debts, cannot be avoided on the ground that the debts to be paid are usurious. Denn v. Dodds, 1 J. Cas. 158.

6. A judgment in the hands of a bona fide assignee is, it seems,. not affected by usury between the original parties. Wardell v. Eden, 2 J. Cas. 268. S. C. 1 J. R. 531, note.

7. A note given as collateral security for a judgment recovered, will not be affected by usury in the transaction upon which that judgment was obtained. Stewart v. Eden, 2 Caines R. 150.

8. The contract and security are void only as between the original parties, or where the suit is upon the very instrument infected with usury. Jackson v. Henry, 10 J. R. 185.