71 F.2d 136 | 5th Cir. | 1934
The suit is to remove cloud from a large body of land in Texas, by canceling a trustee’s deed and a deed of trust and, in the alternative, for a money judgment for the excess in value of the land over the debt admitted to be due against it. The grounds are usury making void the contract provisions for interest and the trustee’s sale made because of default in interest payments. The claim is that the provisions for accelerating maturity in the notes the original debtor gave so taint tbe contract with usury that a sale made under the deed of trust for nonpayment of interest is void, not only against the maker of the notes and deed of trust, but also against plaintiff, the purchaser from the original borrower under an express agreement, as part of the purchase price, to assume and pay the indebtedness against the property.
The District Judge found that plaintiff had expressly assumed and obligated himself to pay the $90,000 note with interest at 6 per cent, per annum from April 1, 1928, and had deducted that amount so assumed from the total consideration he had agreed to pay. He concluded that this assumption absolutely bound plaintiff to pay the debt and interest and effectually estopped him from claiming usury or any, defect in it. He dismissed' plaintiff’s bill for want of equity, and, by decree on defendant’s cross-bill, quieted its title.
Plaintiff, here as appellant, earnestly presses upon us the enormity of the offense of usury, the far-reaching and drastic effect of the Texas statute (Rev. St. 1925, art. 5071) to sweep the interest out of the contract when, through any device or by any form there is usury through the stipulation for interest in excess of the amount allowed by law. But for the persistence with which appellant presses his case and the earnestness with which he pleads for a different view, we should have thought this a plain ease of one wanting to have his cake and eat it too — of one purchasing property for an agreed price and then demanding .to keep the property without paying for it.
Appellant’s argument entirely overlooks — in fact, it deliberately refuses to see —that, as to him, tbe mortgage debt does not represent a stipulation to pay interest for the use or detention of money. It represents a flat sum, a part of the stipulated purchase price, which, instead of taking from him in cash, the grantor has required the purchaser to pay to another for the account of the grantor. Usury is a personal defense. It may optionally be waived or asserted by the
The decree was right; it is affirmed.
The deed under which appellant claims the purchase of 23,145.35 acres of land in part provided: “The consideration for which the seller agrees to sell said land and which the buyer agrees to pay therefor is the sum of $7 per acre, the same to be paid as follows: (a) $25,000 to be paid in cash; (b) the buyer agrees to assume an indebtedness owing tbe California State Life Insurance Company in the principal sum of $90,000 now secured by lien upon the above described lands, due April 1, 1933, and also agrees to assume the interest on said indebtedness accruing from April 1, 1928 to date at the rate of 6% per annum. Tbe balance of the purchase price, that is, the balance remaining after tbe deduction from the total purchase price of $25,000 in cash and $90,000 and accrued interest assumed by tbe buyer, is to be paid in two equal annual installments.”