likewise 1 Saund. 295, where the old cases on this point are collected.

5. Therefore, as to the persons between whom such securities (having usury in their inception) are void, they are void in all hands; for being bad titles they give nothing. In a word, as to their condition as securities, they are within the analogy of bills of exchange on bad stamps.

6. But as this circumstance, i. e. the invalidity of usurious securities in innocent hands, unnecessarily falls hard upon such parties, the courts of law, in order to preserve the equity of the case, will proceed upon very nice distinctions in avoiding securities in such hands; and will eagerly avail themselves of every incidental circumstance, to put the original usury out of the security. Thus, where A., for an usurious consideration, gave his promissory note to B., who transferred it to C. for a valuable

consideration, without notice of the usury, and afterwards A. gave to C. a bond for the amount, it was held not to be usury. Cuthbert v. Haley, 8 T. R. 390. But if 4. had given B. his bond on consideration of such note, it would have been within the statute. So, a bona fide debt is not de

stroyed by being mingled with an usurious contract relating to it. Gray v. Fowler, 1 H. B. 462. And, after usurious securities given for a loan have been destroyed by mutual consent, a promise by the borrower to repay the principal and legal interest is binding. Barnes v. Hedley, 2 Taunt. 184. The reason is, that though the first contract was void by usury, yet as the debt still subsisted, a new contract without usury was good.

6. In the same manner intermediate usury, in the discount of bills of exchange good in their inception, does not affect the bills themselves. The person who takes the usury may incur the penalty; but the bill is good in the hands of an innocent holder. Daniel v. Cartony, 1 Esp. 274. See likewise Turner v. Holme, 4 Esp. 11. But where a bill was drawn for the purpose of effecting an usurious contract between the acceptor and a stranger, who undertook to discount it, the bill was holden to be void, though the drawer was not privy to such contract. Young v. Wright, 1 Campb. 131. In which cases Lord Ellenborough, recognizing the authority of Lowe v. Waller, says, "That where there is a corrupt agreement that a bill should be dis

counted at usurious interest, it is vitiated, into whatever hands it might afterwards come." But, where a bond was given for the performance of an usurious contract, which was afterwards cancelled by the consent of the parties, and a fresh hond taken for the principal and interest, deducting the payments illegally made on the former contract, such second bond was held to be valid. Wright v. Wheeler, 1 Campb. 165 n. In the same manner, where the acceptor of a bill of exchange, drawn in pursuance of an usurious contract, accepted a second bill for the purpose of raising money to take up the former, and the second bill was discounted by a bona fide indorsee at the legal rate of interest, the second bill was held not to be affected by the usury which contaminated the first. Dagnal v. Wyke, 2 Campb. 33.

7. If a man indebted to another in a bona fide debt, makes a contract with his creditor, on which he stipulates to pay usurious interest, although the contract be void, it does not destroy the original debt. Gray v. Fowler, ante. And it has long been acknowledged in courts of equity, that, notwithstanding usurious securities have been given, the money

lent is a debt in conscience, and ought to be repaid with legal interest. And the Court will not relieve against usurious contracts, unless the debtor pay the principal and legal interest. 2 Vesey 567. 2 Bro. Ch. Ca. 649. The ground of the practice in the courts of equity is, not that they consider the defendant as entitled to the money, but because, unless the complainant waves the penalties of the statutes, and, amongst them, the forfeiture of the money lent, the defendant could not answer without criminating himself, which a court of equity will not compel him to do. See likewise, Fitzroy v. Gwillim, 1 T. R. 153, where in trover for goods, which had been pledged for money advanced on an usurious contract, Lord Mansfield held, that it was necessary to prove a previous tender of the money actually due.

III-Of the Penalty.

With respect to the third branch of the statute, the penalty, very few observations will be sufficient. The statutes of usury, being penal, are construed strictly; and the act of usury, in order to fall within the terms, must be complete. Hence it follows, (and it has been so decided in many cases)

that as the penalty is not in. curred until more than legal interest is actually received, the time of bringing an action for the penalty (which is one year after the offence committed by 31 Eliz. c. 5. s. 5.) begins from the receipt of the usurious interest, and not from the making of the contract; unless more than legal interest be received at the time of the contract. Doug. 235. 3 Wils. 261. And, as we have before shewn, that there may be usury in the person, and not in the security; the security remaining good, and the usury being subsequent; so the person may be subject to the penalties, whilst the security (the occasion and means of the usury)

may be valid; and, on the other hand, the security may be illegal and void by the statute, whilst the party may not be subject to the penalty of it. For if a man contract for more interest than the statute allows, and afterwards takes no more than legal interest, the security indeed is void; but the penalty is not incurred. And herein agree all the cases, ancient and modern. Abraham v. Bunn, 4 Burr. 2253. Floyer v. Edwards, Cowp. 114. Fisher ▼. Beasley, Dougl. 237. See likewise

Williams' Saunders 295, where many of the old cases are collected, and the pleadings in the action for usury explained.