
    Nancy A. Fiero, Impleaded, etc., Resp’t, v. William H. Meaker, as Executor, etc., App’lt.
    
      (Supreme Court, General Term, Fifth Department,
    
    
      Filed March, 1894.)
    
    1. Usury—Bond and mortgage.
    Where a party, on receiving a deed of certain premises, gives a bond and mortgage thereon for the purchase price to a third person, to whom the grantor is indebted in a larger amount, as part payment of such indebtedness, and pays to such mortgagee a bonus, such bond and mortgage are usurious.
    
      2. Witness—Competency—Section 829.
    Where a witness has no direct interest in the result of the action, but whatever interest he has is remote or contingent, such interest does not under § 829 of the Code, disqualify him from testifying.
    Appeal from a judgment entered in Cayuga County clerk’s office October 6th, 1893, in favor of the defendant upon the report of a referee.
    The action was brought for the foreclosure of a mortgage of eight hundred dollars given by the defendant Nancy A. Fiero to Samuel Stokes, the plaintiff's testator. The defense was usury.
    
      Lyon & Pierce (John D. Teller, of counsel), for app’lt; F. I). Wright,, for resp’t.
   Lewis, J.

The defendant, Mrs. Fiero, was the owner of real •estate in the city of Auburn on which there was a mortgage. Upon the sale of the premises .upon the foreclosure of said mortgage James D. Hoskins became the purchaser under an arrangement with Mrs. Fiero that he would bid'in the property and would convey it to her upon payment to him of the sum of eight hundred ■dollars, the amount of his claim upon the property. The testator Stokes was at the time the owner and holder of a bond and mortgage made by Hoskins for the sum of twenty-five hundred dollars not at that time due. Stokes was desirous that Hoskins should make a payment upon his bond and mortgage of fifteen hundred dollars. Hoskins informed Stokes of his relations with the Fiero property and agreed that if Mrs. Fiero would consent so to do, that he would convey to her the Auburn premises and take her bond and a mortgage running to Stokes for the sum of eight hundred dqllars. It was agreed between Hoskins and Stokes if Mrs. Fiero consented so to do that Stokes should receive the bond and mortgage from Mrs. Fiero with seven hundred dollars in money to be paid by' Hoskins as a payment of fifteen hundred dollars upon his said twenty-five hundred dollar bond and mortgage. Hoskins thereupon conveyed the premises to Mrs. Fiero; she executed the bond and mortgage to Stokes; and Mrs. Fiero, Stokes and Hoskins met at Mr. Hoskins’ office. Hoskins was called as a witness by Mrs. Fiero on the trial and testified as follows as to what occurred at that interview: “ I went over to the Bank and got seven hundred dollars; laid it with the mortgage and bond, exhibits 1 and 2, on my desk; also the deed. I passed the bond and mortgage and the money towards Stokes. He shook his head and said no. I handed the deed to Mrs. Fiero. He said: “ I want to know something about that present” I said: “ Mrs. Fiero, Stokes wants a bonus on this mortgage. I so called it. He called it a present. Mrs. Fiero got up and came over towards him and said, “ What is it, Mr. Stokes ? ” He replied, I am always in the habit of taking a present when I take a mortgage. I want one now.” She said, “How much do you want, Mr. Stokes ? ” and he answered, “ Twenty-five dollars.” She said, “I haven’t got twenty-five dollars. All I have in the world is fifteen.” There was a pause. I says, “ Sammy, don’t be a hog. If fifteen dollars is all the woman has got take it and not be a hog.” I was out of patience with him. He then said, “ Well, give me the money.” She then took the money out of her pocket and gave it to him. He then picked up the bond and mortgage and seven hundred dollars. I then wrote the endorsement on the mortgage exhibit “ 3 ” and he signed it then and there and went out of the office. Frederick H. Kennedy testified that he was present at the interview referred to by the witness Hoskins; that they were talking about the eight hundred dollar mortgage Mrs. Fiero was giving to Samuel Stokes. His account of the affair was substantially that related by Mr. Hoskins. It is the contention of the appellant that the transaction did not amount to a loan or forbearance of money for the reason that no money in fact passed between the parties. We think the transaction in effect amounted to an ‘advancement by Stokes to Mrs. Fiero of the sum of eight hundred dollars, for which she gave her bond and mortgage for the payment' of that sum with interest Had Stokes handed to Mrs. Fiero eight hundred dollars in currency and Mrs. Fiero . had handed the money to Hoskins and Hoskins delivered it to Stokes and its endorsement had been made as stated it would be conceded that the defense of usury was established. As the law looks not to the form of the transaction but to its substance,was not what occurred in substance and effect the same thing? Mrs. Fiero by the transaction paid her debt to the Hoskins, and Hoskins secured an endorsement upon his indebtedness to Stokes, and Stokes obtained the bond and mortgage of Mrs. Fiero for the eight hundred dollars, with interest, and in addition to the lawful interest demanded and received the fifteen dollars bonus. The referee held, and we think, correctly, that it amounted to a usurious agreement for the loan and forbearance of money, and that the bond and mortgage were usurious and void.

The plaintiff objected to Mr. Hoskins testifying to the transaction between Mr. Stokes and Mrs. Fiero upon the ground that he was interested in the event of the action, and was the person from, through or under whom the defendant derived her interest or title. The subject-matter of the litigation was the bond and mortgage. Hoskins, after they had been accepted by Stokes, had no further interest or concern in them. He had conveyed his interest in the premises to Mrs. Fiero before the bond and mortgage were accepted by Stokes, and had received his pay in full from Mrs. Fiero. He certainly had no direct interest in the result of the action. It is the contention of the appellant that he, at least, had a contingent, or remote interest; that the bond and mortgage of Mrs. Fiero having, by the arrangement with Stokes, been endorsed upon the twenty-five hundred dollar mortgage as a payment, that the evidence of the security because- of usury" had the effect to revive his indebtedness to Stokes to that amount Mrs. Fiero in good faith took title to the premises and paid her debt-to Hoskins by her bond and mortgage. -Hoskins was not a party to the usurious agreement between Mrs. Fiero and Stokes. He had conveyed to Mrs. Fiero all the interest he had in her land,, and because Stokes saw fit to demand usury of Mrs. Fiero, and in consequence is not able to recover his money, Mrs. Fiero’s indebtness to Hoskins is not thereby revived. If so, he is the only party who is to suffer by an usurious agreement to which he was-not a party. Had Hoskins been the maker of the eight hundred dollar bond and mortgage, and they had been avoided because of usury, the rule contended for by the appellant might apply, he would in that case have been a party to the usurious agreement which he was instrumental in having declared void. The most, that can be claimed is, that Hoskins had a remote or contingent, interest. Such an interest did not disqualify him. McGlynn v. Seymour, 14 St. Rep. 705-7; Hobart v. Hobart, 62 N. Y. 80; Wallace v. Straus, 113 N. Y. 235; 22 St Rep. 984; Connelly v. O'Connor, 117 N. Y. 91; 26 St. Rep. 840; Beakes v. Da Cunha, 126 N. Y. 293; 37 St. Rep. 14. Hoskins was not the person through, or under whom either of the parties derived their title or interest in the subject-matter of the litigation. The bond and mortgage in controversy were given by Mrs. Fiero to Stokes. Hoskins had no direct interest in it. The case of Smith v. Cross,, 90 N. Y. 549, to which we are referred by appellant’s counsel does not sustain his contention. The witness Wilson, in that case had a direct interest. He was the maker of the bond and mortgage, and was, at the time they were given, the owner of the premises upon which the mortgage was a lien. After negotiating the bond and mortgage, he conveyed the premises upon which the mortgage was a lien, with a covenant of warranty to the defendant. He was, therefore, directly interested to defeat the mortgage. We find nothing in the plaintiff’s exception requiring a reversal of the judgment. It should be affirmed, with costs.

Dwight, P. J., Haight and Bradley, JJ., concur.  