Sec 464

Ignorance of fact, leading to a mistake in calculation, will not avoid a contract on account of usurious interest nominally charged.8

Mistake in fact will not avoid contract; otherwise as to mistake in law

1 Int. Priv. Recht, pp. 237, 238, 256.

2 Jour, du droit int. prive, 1874, p. 128: see Fiore, sec 265.

3 Parker v. Royal Exchange Co., 8 D. 372; cited Guthrie's Savigny, p. 204, note. See to same effect, Harvey v. Archibold, 1 Ry. & Moo. 104; S. C, 3 B. & C. 626; Young v. Godbe, 15 Wal. 562; Fitch v. Reiner, 1 Biss. 337; Phelps v. Kent, 4 Day, 96; Potter v. Tallman, 35 Barb. 182; Bank of Georgia v. Lewin, 45 Barb. 340; Bowen v. Bradley, 9 Abb. N. Y. Pr. 395; Findlay v. Hall, 12 Oh. St. 610; Arnold v. Potter, 22 Iowa, 194; Senter v. Bowman, 5 Heisk. 14; Duncan v. Helm, 22 La. An. 418. The tendency of the French authorities is to hold that the rate of interest is to be determined by the law of the place where the money is to be employed. Jour, du droit int. prive, 1875, p. 354; Brocher, p. 363.

4 L. 34, D. de usur. 22, 1.

5 Hert. IV. 53; Seuffert, Comment. I. p. 254.

6 Wh. Conf. of L. sec 508, 672; Bar, p. 256.

7 Andrews v. Pond, 13 Pet. 65; Tilden v. Blair, 21 Wall. 241; Upham v. Brimhall, 11 Metc. 526; Hiatt v. Griswold, 5 Fed. Rep. 573.

6 Story on Cont. sec 730, citing Glass-furd v. Laing, 1 Camp. 149; Gibson v.

Sec 465

The rights given by the statutes are strictly personal. A stranger cannot be heard to avoid a contract on the ground that it is usurious.1

Sec 466

When a contract is in itself valid, it is not affected by the fact that the lender receives, by a subsequent special arrangement, without remodelling the contract, an excess of interest.2

Sec 467

Supposing that a statute exists prohibiting the reception of interest beyond a fixed amount, and making void all contracts of loan in which the in-terest is beyond this amount, the statute cannot be evaded by disguising loans as sales. If the transaction is put in the shape of a sale with a right of redemption at a rate equivalent to a usurious penalty, then it will be regarded as a loan.3 Interest beyond the legal standard, also, when paid for forbearance to call in money due, amounts to usury.4 Nor, by technical subtleties, such as by antedating,5 or by forcing depreciated currency or goods upon the borrower,6 or by retaining a bonus,7 or by masking the transaction in the form of discounts,8 can the penalties of the statute be escaped.9 Nor is an agreement not to reclaim usurious interest valid.10 Nor can the usurious taint of a loan be got rid of by reconstructing or remoulding of the loan. No matter how numerous may be the reconstructions and remodifications of a security, if the original consideration is tainted with usury, this taints all subsequent renewals of the indebtedness resting on such consideration.1 But if the transaction be meant bona fide as a loan at interest, and the interest stipulated is legal, the contract is not avoided by the reservation to the lender of compensation for trouble he may have been put to, or may be put to in suing out the debt;2 provided such compensation is not excessive.3 Nor is compounding interest, at certain risks, in mercantile accounts, usury, when such is the arrangement between the parties;4 nor does the advantage derived from differences of exchange amount to usury.5 But all securities substituted for the original contract partake of its taint.6

Stranger cannot avail himself of statute.

Contract not affected by subsequent usurious reception of interest.

Statute cannot be evaded by disguising loan as sale nor by reconstructing loan.

Stearns, 3 N. H. 185; Bank of Utica v. Wager, 2 Cow. 720; and cases cited supra, sec 197-8.

1Williams v. Tilt, 36 N. Y. 319; Stoney v. Ins. Co., 11 Paige, 635.

2 Gray v. Fowler, 1 H. Bl. 462; Bank U. S. v. Waggoner, 9 Pet. 399; Rams-dell v. Soule, 12 Pick. 126; Bremen v. Hess, 13 Johns. 52; see Kilgore v. Em-mit, 33 Oh. St. 410.

3 Barker v. Vansommer, 1 Bro. C. C. 151; Waller v. Dalt, 1 Ch. Ca. 276; 1 Dick. 8; Scott v. Lloyd, 9 Pet. 418; Train v. Collins, 2 Pick. 145; Agricultural Bk. v. Bissell, 12 Pick. 586; Dayton v. Moore, 30 N. J. Eq. 543; Philip v. Kirkpatrick, Add. (Penn.) 124; Musgrove v. Gibbs, 1 Dall. 216; Evans v. Negley, 13 S. & R. 218; Citizens' Land Co. v. Uhler, 48 Md. 455; Douglas v. McCheney, 2 Rand. Va. 109.

4 Scott v. Lloyd, 9 Pet. 440; Man-derson v. Bank, 28 Penn. St. 379.

5 Witham v. Williams, 3 Green, N. J. 255.

6 Tate v. Wellings, 3 T. R. 531; Bank of the Valley v. Stribling, 7 Leigh, 36.

7 Whitney v. Tyler, 12 Met. 193; East River Bank v. Hoyt, 32 N. Y. 119.

8 Powell v. Waters, 8 Cow. 669.

9 See Auriol v. Thomas, 2 T. R. 52; Fitzsimmons v. Baum, 44 Penn. St. 32; Bachdell's App., 56 Penn. St. 386.

10 Bosta v. Rheem, 72 Penn. St. 54.