George R. Gaither, Plaintiff in Error v. the Farmers and Mechanics Bank of Georgetown

The plaintiff here was defendant in the Court below, to an action instituted by the Farmers and Mechanics Bank of Georgetown, on a note made by him to W. W. Corcorran & Co. and by them endorsed in blank to the Bank. The record makes out a case for this Court, of whcih the following is a summary: That W. W. Corcorran & Co. discounted their own notes with this Bank, at thirty days; the Bank expressly stipulating, that in lieu of money they should receive what they call a post note of their own, payable at a future day, without interest. The evidence would make out that the post notes given for this discounted note, were at thirty-five days after date; that it is, two days after the discounted note fell due; so that in fact there was no advance of money, although an interest of six per cent. per annum, was taken from the Corcorrans, and the post notes of the Bank were proved to be at a discount of one per cent. making one and a half per cent. for thirty days, or eighteen per cent. per annum. The note on which this suit was instituted, was passed to the Bank as a collateral security for the discounted note, and was altogether unaffected with usury in its origin. The ground on which the right of the Bank is resisted, is, not that Gaither is discharged from his contract with W. W. Corcorran & Co., but that the endorsement to the plaintiff below, having been made to secure a note given on an usurious contract, could vest no interest or cause of action in the endorsee. In order to avoid the pressure of this defence, in the Court below, the plaintiffs there gave in evidence a writing, addressed by W. W. Corcorran & Co. to the Bank, bearing date 17th February, 1823, prior to the institution of that suit, in these words: 'Please deliver to Thomas Corcorran what notes of ours may remain in your possession, after the debt due the Bank, for which they are left as collateral security, shall have been paid, or hold the same subject to his order.' And it was further shown, that a few days before the issue was tried below, an adjustment had taken place between the Bank and Thomas Corcorran, (who was then endorser and assignee of W. W. Corcorran & Co.) upon which Gaither's note had been delivered to Thomas Corcorran; he then endorsed his name on Gaither's note, below that of W. W. Corcorran & Co. and thereupon the Bank, before the jury were charged, had the name of Thomas Corcorran entered on the docket, as the cestuy que use, for whom they were prosecuting their suit, and the jury, it appears, were charged with the cause, according to the exhibition of parties, thus made upon the docket; that is, to try an issue between the Bank, to the use of Thomas Corcorran, plaintiff, and Gaither, defendant.