Generally speaking only the parties to a usurious transaction are affected by it. It is not a defense for the drawer of a bill of exchange against the bank;1 but under the national banking law the reservation of usurious interest destroys the interest-bearing quality of the instrument, and hence the acceptor of drafts purchased without an indorsement to it by a bank at usurious rates may defend against interest upon the drafts.2 A corporation forbidden by a state statute to set up the defense of usury may nevertheless claim the defense under the national banking law.3 A director of a bank may set it up against the bank on a loan to himself.4 But a renewal note which was given for an accommodation note which had an indorser, who indorsed the accommodation note to the bank at a usurious rate, is not subject to the defense of usury in favor of an indorser upon the renewal note.5 Parties who may sue are noticed in the next section.

13 See note 2, ante.

16 See note 2, ante. But the penalty does not draw interest (Higley v. First Nat. Bank, 26 Ohio St. 75) until judgment.

17 Barnet v. National Bank, 98 U. S. 555; Wiley v. Starbuck, 44 Ind. 298; Oldham v. First Nat. Bank, 85 N. C. 240; First Nat. Bank v. Gruber, 91 Pa. 377; Hill v. National Bank, 56 Vt. 582.

18 Driesbach v. Wilkesbarre Bank, 104 U. S. 52; Danforth v. Nat. State Bank, 48 Fed. R. 271, 3 U. S. App. 7; Farmers' Nat. Bank v. Stover, 60 Cal. 387; Stephens v. Monongahela Bank, 111 U. S. 197, and numerous other cases. One case says the maker of the note may plead to a suit brought upon a collateral mortgage the satisfaction of the debt by the payment of usurious interest on renewals before debt came into the possession of the bank. Exeter Nat. Bank v. Orchard, 39 Neb. 485.

19 National Bank v. Davis, 8 Biss. 100; Kinser v. Farmers' Nat. Bank, 58 Iowa, 728; Lynch v. Merchants' Nat. Bank, 22 W. Va. 554; Carpenter v. National Bank, 50 N. J. Law, 6; First Nat. Bank v. Smith, 36 Neb. 199. Or judgment. Duncan v. First Nat. Bank, Fed. Cas. No. 4135. Giving a note seems to be payment. Lebanon Nat. Bank v. Karmany, 98 Pa. 65; but see Cadiz Bank v. Slemmons, 34 Ohio St. 142. See note 11 to Sec. 196, ante.

20 Henderson Nat. Bank v. Alves, 91 Ky. 142.

21 Morehouse v. National Bank, 30 Hun, 628; Lebanon Nat. Bank v. Karmany, 98 Pa. 65.

22 Danforth v. Nat State Bank, 48 Fed. R. 271, 3 U. S. App. 7; Cadiz Bank v. Slemmons, 34 Ohio St. 142. But where renewal notes are given after crediting payments, see Kinser v. Farmers' Bank, 58, Iowa, 728