Farmers' & Mechanics' Bank v. Kimmel

1 Mich. 84 | Mich. | 1848

Usury, under R. S. 1S3S, is a personal defence, to be interposed by a party, to the contract, of which a subsequent purchaser cannot avail kimself._

Appeal from the Court of Chancery. In June, 1848, Kimmel filed a bill in the court of chancery to foreclose a mortgage executed to him by one Ward, on the 11th February, 1841. The bank held a subsequent mortgage given by Ward, and in its answer set up usury in the mortgage to Kimmel. The usury consisted in the conveyance by Ward to Kimmel, of a village lot, not covered by the mortgage, as a bonus or consideration for the loan, beyond the legal interest. Ward made no defence, and the chancellor having made a decree m favor of Kimmel,, for the amount of the mortgage and interest, the bank appealed. The court, in deciding the ease, say, per Miles, J., who delievred the opinion, “ We will not stop to inquire whether this amount would be reduced by the value of the village lot, in case the mortgagor had set up, the usury as a defence to the foreclosure, because we think that at least under the statute (R. S. 1888), the defence is personal, and however the appellants may be affected incidentally by the contract, they cannot take advantage of the usury. A contrary rule would hold out no relief to the borrower. ' It would only be transferring his money from the pocket of the lender to the pocket of the holder of the equity of redemption. De Wolf v. Johnson, 6 Peters’ Cond. R. 152.”

Decree affirmed.,