Rose v. Dickson

Van Ness, J. delivered the opinion of the court. The truth of the facts stated in this plea is admitted by the demurrer, and the question then arises, whether the sale of the stock being merely colourable, the contract is not founded in usury ? Each share of the stock is admitted, by an endorsement, upon the pleadings, to be of the nominal value of 25 dollars ? and this fact, independently of such admission, is necessarily inferible from the plea. The plea expressly avers, that the shares stipulated to be transferred by the plaintiff, were worth but two hundred and fifty dollars, and that it was corruptly and usuriously agreed, that. the defendant should take them at their nominal value, being 400 dollars ? and this sum together with 687 dollars in money, is the amount of the bond upon which this suit is brought. Upon this statement of facts, there can be no doubt that the bond is void. The cash lent to the defendant was tipon the ground that the defendant should pay nearly double the real value of the stock, and interest is reserved upon the whole amount. Whether this was a 198 bona fide sale of the stock, or colourable only, is a fact which the plaintiff may put in issue if he pleases; and it is for the jury to decide upon it. If they find that it was a fair sale, then the defendant may be liable to pay the whole amount of the plaintiff’s demand; but if, on the contrary, they shall be of opinion that the transfer of the stock was a mere device, to obtain an extravagant and unlawful interest, the bond is usurious and consequently void. (Tate v. Williams, 3 Term Rep. 538. Doe, ex dem. Davidson, Ex'r., v. Barnard, Assignee, &c. 1 Esp. Rep. 11. Moore v. Battie, Ambler, 3 71.) There must be judgment for the defendant, with leave to the plaintiff to withdraw the demurrer, and take issue on the plea. Judgment for the defendant!