William Burnham Woods

“ Myers, 51 Iowa, 397, it was held to be 'well settled that when an agent for loaning money takes a bonus or commission to himself beyond the legal rate of interest, without the knowledge, authority, or consent of his principal, it does not affect with usury the loan of the principal.'
These decisions seem to be founded on plain principles of justice and right. For when two persons, the agent and the borrower, conspire together, and for their own purposes violate the law, how can punishment for their acts be justly imposed on the innocent third party, the lender? ”

“ It can hardly be contended that the penalties imposed for a violation of the usury laws are intended as a reward to the borrower. According to the principles of jurisprudence as generally administered, and especially as applied by the supreme court of Iowa under the statute law of that state, if suit had been brought by Mrs. Davidson herself to enforce the payment of the note given by Call to Burnham for her, the defense of usury would have failed. ”

“ For it is settled that, where the promisor in a usurious contract makes it the consideration of a new contract with a third person not a party to the original contract, or to the usury paid or reserved upon it, and the new contract is not a contrivance to evade the statutes against usury, the latter is not illegal or usurious. ”