On August 17, 1949 the defendants, Frank L. Twitty and Robert L. Twitty, instituted a suit in the Atlantic City District Court against the plaintiff, Melvin B. Cramer, on two of a series of nine negotiable promissory notes.
Thereafter, plaintiff instituted this action, alleging, inter alia , that he did not have an adequate remedy at law, that unless said action be stayed and the defendants enjoined from transferring or assigning the outstanding notes, as well as a certain chattel mortgage hereinafter adverted to, there would arise a multiplicity of suits, and that the promissory notes and the chattel mortgage might find their way into the hands of innocent purchasers. He further alleges that both the promissory notes and the chattel mortgage are tainted with usury and therefore demands the relief accorded by R.S. 31:1-3. Pursuant thereto, the district court action was enjoined.
Defendants, by way of counterclaim, seek: (1) to obtain a judgment on the six last due notes of the above referred to series, in the total sum of $5,000, with interest and costs, and (2) to foreclose the chattel mortgage to which reference is above made.
I find the facts in connection herewith to be as follows:
On or about May 5, 1945 the plaintiff, finding himself in some financial difficulty, borrowed certain sums of money from the defendant Russell Weith, for which the plaintiff was obliged to pay a premium or bonus. This loan was to be repaid by September of 1945. On September 5, 1945 the said plaintiff not having paid to Weith the full amount of the above referred to loan, borrowed additional money, for which he again paid a bonus or premium, and executed and delivered to the said Weith a chattel mortgage in the sum of $10,000, which sum included the balance due on the original loan, the premium or bonus, and the newly advanced money. The affidavit of the mortgagee in said mortgage reads in part as follows:
"The sum of Ten Thousand ($10,000) Dollars as evidenced by two checks; one certified in the amount of $7,500, drawn on the Brooklyn Trust Co., dated August 30, 1945, and signed by Pauline Isaacs, Attorney, and endorsed by Pauline Isaacs to Clara Fishman and endorsed by Clara Fishman to Melvin B. Cramer; and the other check in the amount of $2,500, drawn on the Brooklyn Trust Co., dated September 4, 1945, and signed by Pauline Isaacs, Attorney, to the order of Clara Fishman and endorsed by Clara Fishman to Melvin B. Cramer -- which $10,000 was loaned by Russell Weith, the mortgagee, to Melvin B. Cramer, the mortgagor, on the 4th day of September, 1945, to be repaid by the said Melvin B. Cramer as set forth in the foregoing mortgage; out of which said sum is to be paid and cancelled a present chattel mortgage in the sum of $3500, now held by Russell Weith on the goods and chattels on the premises mentioned in the aforesaid mortgage."
The plaintiff not having paid in full the amount due on said mortgage, delivered to Weith, upon his demand, a series of nine promissory notes, all dated October 24, 1947, in the following amounts and payable on the following dates:
$750 payable on July 15, 1948
750 payable on August 15, 1948
1000 payable on September 15, 1948
750 payable on July 15, 1949
750 payable on August 15, 1949
1000 payable on September 15, 1949
750 payable on July 15, 1950
750 payable on August 15, 1950
1000 payable on September 15, 1950
Each of said notes, except for the amount payable and the due date thereof, was identical. One of ...