418 Trading Corp. v. Oconefsky
| Decision Date | 02 April 1964 |
| Citation | 14 N.Y.2d 676,249 N.Y.S.2d 876,198 N.E.2d 907 |
| Parties | , 198 N.E.2d 907 418 TRADING CORP., Appellant, v. Pearl OCONEFSKY et al., Respondents, and Cambridge Factors, a limited partnership, et al., Defendants. |
| Court | New York Court of Appeals Court of Appeals |
Appeal from Supreme Court, Appellate Division, First Department, 19 A.D.2d 593, 240 N.Y.S.2d 956.
Action was brought to foreclose a mortgage. The defendants interposed the defense of usury. The defendant husband and defendant wife, who desired to purchase a one-family home, applied to the plaintiff for a loan. The plaintiff, in order to exact more than the legal interest rate, required to the defendants, who operated a small business under a corporate name, to execute instruments whereby it appeared that the corporation requested a loan of $4,000, agreed to repay it and agreed to permit plaintiff to pay therefrom $1,000 for brokerage commission and other expenses in connection with the making of the loan. The plaintiff also procured the signature of the individual defendants to a guarantee of the payment of $4,000 and obtained the signature of the defendant wife to a bond for that amount and as collateral security her signature to a mortgage covering the home.
The Supreme Court, Special Term, Bronx County, Charles A. Loreto, J., 37 Misc.2d 745, 734 N.Y.S.2d 747, entered a judgment declaring the mortgage void and held that usury was a good defense. The plaintiff appealed.
The Appellate Division, 19 A.D.2d 593, 240 N.Y.S.2d 956, affirmed the judgment on the opinion of Mr. Justice Loreto. Eager and Steuer, JJ., dissented.
The plaintiff appealed to the Court of Appeals, contending that the loan was made to the corporation and was not subject to the defense of usury.
Isaac Anolic, New York City (George Natanson, New York City, of counsel), for appellant.
Judgment affirmed, with costs.
All concur.
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...defense of usury will be sustained (see 418 Trading Corp. v. Oconefsky, 19 A.D.2d 593, 240 N.Y.S.2d 956, affd., 14 N.Y.2d 676, 249 N.Y.S.2d 876, 198 N.E.2d 907; see, also, Jenkins v. Moyse, 254 N.Y. 319, 324, 172 N.E. 521, 522). While a heavy burden indeed rests upon the party seeking to im......
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