Lukens v. Hazlett

• Decision Date: 22 November 1887
• Citation: Lukens v. Hazlett, 37 Minn. 441, 35 N.W. 265 (Minn. 1887)
• Parties: LUKENS v HAZLETT.
• Court: Minnesota Supreme Court

37 Minn. 441

35 N.W. 265

LUKENSvHAZLETT.

Supreme Court of Minnesota.

November 22, 1887.

(Syllabus by the Court.)

The rule of evidence in “usury cases” is the same as in any other civil action. All that is required is a fair preponderance of evidence. Where a new contract is substituted for a usurious one the taint of usury will affect the new security. H., the payee of an overdue usurious note, pretending to L., the maker, to refuse to renew it, referred him to K., from whom he said he could borrow the money to pay it. L. thereupon applied to K. for the loan, which K. pretended to make to him, taking from him a note running to himself and giving him a check on H.'s bank, which L. indorsed over to H., receiving in exchange therefore merely his old note. In fact the pretended loan by K. was merely colorable, the transaction being a mere device by H. to evade the usury law, K. being his agent, and the new note in fact belonging to H. and being taken in substitution for the first one. Held, that L. could recover the value of property taken on a chattel mortgage executed to secure the new note on the ground that it was usurious, although at the time of its execution he was ignorant of the fact, and supposed that it was made to secure an actual loan made to him by K. It is immaterial that there was no intent on the part of L. to pay usury, and no knowledge that the new note was usurious.

The latitude to be allowed in cross-examination is largely within the discretion of the trial court, and this court will not reverse unless there has been a gross and oppressive abuse of such discretion.

Appeal from district court, Wadena county; STEARNS, Judge.

A. G. Broker and Law & Bullard, for Lukens, respondent.

Hartshorn & Coppernoll, for Hazlett, appellant.

MITCHELL, J.

This was an action to recover the value of personal property taken under a chattel mortgage executed to secure an alleged usurious note.

The note for $585, executed by plaintiff to defendant, was confessedly usurious. If the $637 note secured by this mortgage had been given directly to defendant in substitution for the first one, it would have been also usurious; for where a new contract is substituted for a usurious one the taint of usury will affect the new security. Jordan v. Humphrey, 31 Minn. 495,18 N. W. Rep. 450; Tyler, Usury, 395. The evidence tended to show that when the first note fell due the defendant told plaintiff that he could not renew it, but must have the money, and referred him to one Kelly, from whom he said he thought plaintiff could borrow it; that plaintiff thereupon applied to Kelly for a loan, and that Kelly assumed or pretended to loan him $637, taking as security the note and mortgage referred to, and leaving at defendant's bank a check for that amount payable to plaintiff, which plaintiff indorsed to defendant, receiving in exchange merely the $585 note. In finding a verdict for the plaintiff the jury must, under the instructions of the court, have found that in this matter Kelly was the agent or mere “cat's...