Ready v. Koebke
| Decision Date | 24 May 1879 |
| Citation | 1 N.W. 344,46 Wis. 692 |
| Parties | READY v. HUEBNER and another, imp |
| Court | Wisconsin Supreme Court |
APPEAL from the Circuit Court for Manitowoc County.
Foreclosure of a mortgage executed by Christian Koebke and wife. The mortgagors did not defend. The defendants Julianna Huebner and her husband, F. W. Huebner, second mortgagees, answered setting up the defense of usury in the note secured by the mortgage here in suit.
At the trial, the court ruled out all evidence offered by the defendants Huebner to support the defense of usury, and, upon a finding of facts in accordance with the complaint, rendered judgment in favor of the plaintiff. The defendants Huebner appealed.
Judgment affirmed.
Brief for the appellants by White & Forrest, and oral argument by Mr. Forrest.
Brief for the respondent by Nash & Schmitz, and oral argument by Mr. Nash.
The only question presented on this appeal is, whether, in a suit to foreclose a prior mortgage, a second mortgagee can set up the defense of usury to avoid such mortgage. The mortgagor makes no defense. And the question is, whether the defense of usury is so exclusively personal that it cannot be made by the second mortgagee. We are not aware that this precise question has been before presented to this court for decision, though, in Bensley v. Homier, 42 Wis 631, a strictly analogous one was passed upon. That was an action to foreclose a mortgage, which the mortgagor did not defend. A junior judgment creditor of the mortgagor attempted to avail himself of the defense of usury to defeat the mortgage. The alleged usurious contract, in that case as in this, was made under ch. 160, Laws of 1859. The chief justice, in a very able and most instructive opinion, announced the decision of the court, holding that the defense of usury was personal to the debtor, his privies in blood or estate, or privies to the contract, and that principle and the weight of authority were against the right of the judgment creditor to set it up as against the mortgage. The chief justice quotes, with approval, a passage from Tyler on Usury, ch. 31, p. 417, in regard to the policy of the statute of usury, where that author says that its object is to protect the borrower against the oppressive exactions of the lender, and that it is not essential to the complete promotion of that object, that other persons than the victims of the usurer, or persons standing in legal privity with him, should have the benefit of the defense. Now it seems to us that this case falls fully within the doctrine of Bensley v. Homier. For there is no solid ground that we can see for a distinction in principle between that case and this. If a junior judgment creditor of the mortgagor stands in no such relation to the original transaction as to have the benefit of the defense, it is difficult to assign a reason which would give a second mortgagee that right. If one cannot attack the prior mortgage for usury, why should the other be permitted to do it?
The counsel for the defendant insists that a distinction exists between ...
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