42 Minn. 438 | Minn. | 1890
This is an action to cancel a certain note and a mortgage of real estate to secure it, (the note executed bv the nlaintiff George, and the mortgage by. both. -plaintiffs, to the defendant Travis, and bv him transferred to the, other defendants,) on the ground that they are usurious. The court below found as facts, and the evidence justifies the findings, in substance that the note and the mortgage in question, with two other mortgages given in terms to secure the note, the defendant Travis being named as payee in the note and mortgagee in the mortgages, were executed without any consideration nassingat. the, time oj.,their ..execution, in order that, -for the purpose, pf raising money for plaintiff George, the said defendant might negotiate, thcm,.a.S,his - o w-n- on the. best.ierma. ih&Lhe could, obtain; and Travis afterwards sold and transferred the note and mortgages to the other defendants for $6,500, the note and mortgages being for $7,500. Neither of said other defendants knew that Travis did not own the note and mortgages.
On the findings of fact there is no question that the transaction between Travis and the other defendants was not a loan, but was the purchase by the latter of securities held and apparently owned by the former. The latter in good faith supposed they were making a purchase and not a loan, and they had a right so to suppose, and they did not intend anything else. Had they known the real character of the transaction between plaintiff and Travis, and that the latter, in offering to sell-the ostensible securities, was acting as the agent of the former, — in other words, had they known that they were dealing with the maker of the securities, it might then have been regarded as a loan., The case would then have been similar to Tiedemann v. Ackerman, 16 Hun, 307, as, from the statement of them, we understand the facts of that case. For in that case the party charged with usury made the ostensible purchase, not from the payee in the securities, but from the maker of them, and must have known that they had no operation unless by virtue of such purchase;
To charge these defendants with usury it would be necessary to change them into lenders, contrary to what they supposed and intended, and to hold that they dealt with plaintiff, when they intended to deal only with Travis, and supposed they were doing so. There having been no usury as between plaintiff and Travis, the principles ■of estoppel, so far as the question of usury is concerned, have no ■application to the case. If plaintiff made Travis his agent to sell •the securities as his own, an estoppel as to their validity and the suf-’ ficiency of a consideration to support them, might arise upon what wa's done.and said by him within the scope of his authority.
Judgment affirmed.