I agree with Mr. Justice Clarke that the judgment should be affirmed, but for different reasons than those expressed in, his opinion. I doubt whether sections 5197 and 5198 of the Revised Statutes of the United States, regulating the charge of interest by 'National banks, and section 55 of the Banking Law of our State (Laws of 1892, chap. 689, as amd. by Laws of 1900, chap. 310), in effect extending the same rights and privileges to State banks as are conferred upon National banks by the act of Congress, are sus- . eeptible of the construction that they relate not only to- discounts of paper by a bank, but also to discounts by any party prior to the time the bank becomes a holder. I am of opinion, however, that the effect of the enactment of section 96 of the Negotiable Instruments Law (Laws of 1897, chap. 612), which provides that “ A holder in' due course holds the instrument free from any defect of title of prior parties and free from1 defenses available to prior parties among themselves, and may enforce payment of the instrument for the full amount thereof against all parties liable thereon,” is to *553render the defense of usury inapplicable to a bona fide holder of negotiable paper acquiring the same in due course.
Mr. Crawford, in the preface to the first edition of his Annotated Negotiable Instruments Law, states that the first draft of the law-was prepared by him for a sub-committee of the committee on commercial law for the commissioners of the different States on unifqrmity of laws; that the draft was submitted to the commissioners on uniformity of laws at the conference in Saratoga in 1896, at which twenty-seven commissioners representing fourteen different States were present; that his draft was revised by the commissioners in a manner to make changes in the existing laws which he had-not felt at liberty to incorporate in the original draft, and as thus amended adopted. In an explanatory note to the Negotiable Instruments Law, as reported to the Legislature in 1897 by the Commissioners of Statutory Revision, it appears that the Negotiable Instruments Law as prepared by the Commission on Uniformity of Legislation in the United States was introduced in the Senate of the State of New York by Senator Lexow, and that at the request of the judiciary committee*of the Senate the Commissioners of Statutory Revision rearranged the bill and added “ several statutes relating to negotiable instruments which were not included in the bill as originally introduced, but which was included in the Commercial Paper Law prepared by this Commission.” (See Assem. Doc. 1897, vol. 22, No. 80, p. 495.)
It thus appears that the Legislature, in enacting the Negotiable Instruments Law, had in mind that there was a concerted move to have that law adopted in the various States and Territories, and it has been enacted in practically the same form in most of the States and some of the Territories of the Union.
The onlv case to which our attention has been called in which a court of review has been called upon to decide whether the Negotiable Instruments Law supersedes, as to bona fide holders in due course fbr value, local laws declaring negotiable paper tainted with usury null and void is Wirt v. Stubblefield (17 App. Cas. D. C. 283). In that case Alvey, Ch. J., delivering the opinion of the court construing the same provision of the Negotiable Instruments Law enacted by Congress for the District of Columbia,* said: “We *554know, moreover, that the great and leading object of the act, not only with Congress, but with the large number of the principal commercial States, of the Union, that have adopted it, has been to establish a uniform system of law to govern negotiable instruments wherever they might circulate or be negotiated. It was not only uniformity of rules and principles that was designed,'but to embody' in a codified form, as fully as possible, all the law upon the subject, to avoid conflict of decisions, and the effect of mere local laws and usages.that have heretofore prevailed. The great object sought to be accomplished by the enactment of the statute was to free the negotiable instrument, as far as possible, from all latent or local infirmities that would otherwise inhere in it, to the prejudice and disappointment of innocent holders as against all of the parties to the instrument professedly bound thereby. This clearly couíd not be effected so long as the instrument was rendered absolutely null and void by local statute, as against the original maker or acceptor; as is the case by the operation, indeed, by the express provision, of the statutes of Charles and Anne.”.
I agree with the views expressed in that opinion. It is, I think, evident that the purpose of the commission representing the various States of the .Union in preparing the draft of the Negotiable Instruments Law, and of the various Legislatures in enacting it, will be thwarted if section 96 is to receive the construction that even as against bona fide holders in due course for value the maker of the note may successfully defend upon the ground that in the inception of the note some local law was violated. The force and effect of the statutes against usury will not be seriously impaired by the construction which, I think, should be given to the Negotiable Instruments Law. The usury laws remain in full force, but to facilitate the free circulation of negotiable paper by protecting holders thereof in due course for value in their right to enforce the same, the usury laws are to that extent superseded by. the provisions of section 96 of the Negotiable Instruments Law. . Of course, it was perfectly competent for the Legislature to do this. The only question is whether or not it so intended, and I am of opinion that it did. ■
The case of Strickland v. Henry (66 App. Div. 23) does not hold that the Negotiable Instruments Law has not to any extent *555superseded the Usury Law. It was there merely held that a holder of commercial paper who received the same at a usurious discount is not protected under the Negotiable Instruments Law, where it appeal’s that the note never had a legal inception, and that its first transfer was at the usurious discount. The .court there say: “ ‘ The holder is bound to know the character of the paper he is dealing in, and if it turns out to be accommodation paper the transaction is usurious.’ ” Of course, a person taking negotiable paper must determine at bis peril whether or not it has had an inception, but having ascertained that fact, J think it was the purpose and intent of the Legislature to relieve him from any latent infirmity, as by a discount at a usurious rate of interest at its inception, or other analogous latent infirmities. ,
I, therefore, vote to affirm the judgment.
Judgment affirmed, with costs. Order filed.
See 30 ü. S. Stat. at Large, 791, § 67.— [Rep.