Dahmes v. Industrial Credit Co.

I am of the opinion that the defense of usury, while not available to Industrial Credit Company,1 is available to plaintiffs, whose liability *36for the corporate indebtedness was direct and primary rather than secondary. In states where, by statute, a plea of usury is not available to a corporation, it is well settled that an individual secondarily liable for the corporate debt likewise may not invoke the plea in litigation relative thereto.2 The basis for the rule is that since the debt was valid when contracted by the corporation, it could not become invalidated by the subsequent creation of…