Page:Federal Reporter, 1st Series, Volume 7.djvu/749

 tJLLVSZ V. OALli. 73T �Falmbb V. Gauj. �{Oireult Court, D. loua. , 1881.) �, 1180117— AoKNoy. �If an agent, in good f aith, makes a loan for another and without the knowledge or anthority of his principal, and for the agent'B own ben- eflt exacts more than legal Interest, the loan is not thereby lendered aaurious. �, BaME— KBNKWAIi— BOKA FiSK ABSIONXB. �Where an usurious obligation is passed for value to an Innocent purchaser without notice of the usury, who afterwards takea a new and substitute security for the debtj there being no taint of usury in the Becond transaction, the plea of usury to the substituted obligation cannot be sustained. i �Casb Statbb. �A. placed $10,000 in B.'s hands to loan. B. made the loan to tha defendant, giving him $8,000, retaining $2,000 as commission, and receiving in his own name defendant's nc^te for $10,000, with semi- annual interest notes of $500 each. B. retained custody of the notes, but recognized them as the property of A., who reoeived the interest, but knew nothing of the usury, and gave B. no authority to retain any bonus out of the sum loaned, or take more than legaj interest therefor. The plaintiS purchased the notes in good faith at their face value without knowledge of the usury in the original loan, and afterwards, through B. & Co., made a new contract with the defend- ant by which he advanced him $1,000, surrendered the note, and received from him the note now in suit for $11,000. PlaintiS did not know that B. & Co. retained $500 of the $1,000 he advanced as com- mission for procuring the reloan. The defenee of usury being setup in suit to foreclose the mortgage given to secure the note, hdd : �(1) That as neither A. nor the plaintiS had any knowledge of the usury, and derived no benefit from it, the plea of usury must be over- ruled. �(2) That A. was to be regarded as the leuder of the money, although 6. failed to disclose his principal and took the notes in his own name. �(3) That plaintiS could still recover though B. be regarded as the lender, gince the substitution of the new security purged the loan of the taint of usury in his hands as an innocent assignee. �(4) That the statutes of lowa relative to usury have not modifled the foregoing rules of law. �In Equity. �This iB a suit to foreclose a mortgage. The only defenee usury. The note secured by the mortgage waa for the sum ▼.7,no.8— 47 ��� �