Maule v. Crawford , 21 N.Y. Sup. Ct. 193 ( 1878 )

Gilbert, J.:

The county judge erred in ruling that a payment upon the note in suit before the transfer thereof to the plaintiff, did not bind the latter without notice. The reverse is the established rule of law. The statute (1 R. S. 768, § 1), defines what shall give to a promissory note the quality of negotiability. It must be payable to another person Or his order, or to the order of another person, or to the bearer. The note in suit was payable to George Harse only, and was, therefore, not negotiable: The plaintiff took it subject to all equities existing between the original parties, for an assignee of a chose in action stands in no better position than his assignor, in respect to any thing which occurred before the assignment.

I think also that the court erred in striking out the defense of usury. The plaintiff should have demurred. (Lathrop v. Godfrey, 3 Hun, 742; National Bank of the Metropolis v. Orcutt, 48 Barb., 256.) That part of the answer was neither sham nor frivolous. On the contrary I think it is by. no means clear that it should have been held bad on demurrer.

It is averred that a note for $275 was given for a loan of $250, and that the payee thereof, wrongfully, unlawfully and corruptly reserved the sum of $25 as usurious interest for the loan of said sum of $250 for the period of eight months. Proof of a loan of $250 and a demand by the lender of a note for $25 more than the sum loaned, as compensation for, or interest upon the same, and a compliance with such demand by the borrower, certainly would have warranted the jury in finding that a usurious contract to that effect was made. It is not necessary that a formal agreement, either verbal or written, should be set forth in so many words. It is enough to- allege the facts as they occurred, and if such facts justify the inference of a usurious contract, the answer ■ought to be held sufficient. (Merch. Ex. Nat. Bank v. Com. Warehousing Co., 49 N. Y., 638.) No stricter rule of pleading-should be administered in a case of usury than in any other case. In the case of Nat. Bank v. Lewis (10 Hun, 468), it was held that the answer did not allege an agreement between the parties. We might doubt the correctness of that construction ot the answer in that case, but there can be no question that in pleading usury, a usurious agreement must bo in substance averred. No demurrer to the answer in this case having been interposed, we think it should have been held sufficient to admit the evidence-of the usury which was offered.

The order denying a new trial, and the judgment must bo reversed with costs.

Dr km an, J., concurred. Present — Barnard, P. J., Gilbert and Dvkman, JJ.

Judgment and order denying new trial reversed, and new trial granted with costs to abide the event.