10 Wend. 113 | N.Y. Sup. Ct. | 1833
By the Court,
When the note declared on was made, and when it became due, it was void for usury; and the defendant had a right to set up that defence against any person holding the note, though he received it in the usual course of business, bona fide, and for valuable consideration. At common law the maker is entitled to the same defence against a bona fide holder for valuable consideration as against the payee, where the note has been transferred after due. The note being void by statute, that constituted a good defence against the payee, independent of the statute provision which avoids usurious paper in the hands of an innocent holder.
But the revised statutes are supposed by the plaintiff’s counsel to defeat this defence altogether in favor of the endorsee, since the 1st January, 1830. The revised statutes, (1 R. S. 773, § 5,) after declaring all usurious bonds, bills, &c. void, add, 65 But this section shall not extend to any bills of exchange or promissory notes payable to order or bearer, in the hands of an endorsee or holder, who shall have received the same in good faith and for valuable consideration, and who had not at the time of discounting such bill or note, or paying such consideration for the same, actual notice that such bill or note had been originally given for an usurious consideration, or upon an usurious contract. It is presumed that the intention of the legislature was to protect the innocent holder for valuable consideration, who had received the note in the usual course of trade, before it was due. The law merchant goes no farther in any case when the maker has a legal or equitable defence, as against
New trial granted; costs to abide event, •