47 Md. 88 | Md. | 1877
delivered the opinion of the Court.
This is an action of trover brought by the appellant against the appellees to recover the value of a promissory
The note was made by the appellees, payable to their own order at four months, and by them indorsed in blank, and in that condition they delivered it to James A. Hooper, a note and bill broker, to be sold for their account, with instructions not to sell it at a greater rate of discount than five and a half per cent, per annum. James A. Hooper attempted to sell the note to the appellant at the rate of discount fixed by the makers, but as the appellant was not willing to buy it at a rate of discount less than six per cent, per annum, the attempt failed. Afterwards James A. Hooper obtained a loan from the appellant of $5000, on his own account, and deposited the note in question as collateral security therefor; and the day after this loan the note was allowed to be withdrawn from the bank by James A. Hooper, to be disposed of by him, but with the understanding and agreement, as alleged by the appellant, that he should hold the note as the property of the appellant if not sold on the day he obtained it, and in case he did sell it, he would return the proceeds of sale to the appellant on the same day. The note was not sold by James A. Hooper, nor was it returned to the bank; but he returned it to the appellees, by whom it was destroyed. On the day the note was withdrawn from the bank James A. Hooper failed, and he afterwards went into bankruptcy. And upon all the facts of the case the questions are, 1st, whether the appellant, in accepting the note as collateral security for the loan to James A. Hooper, acquired a good title thereto as against the appellees? and 2ndly, if a good title was acquired, whether it was not lost by the surrender of the note to James A. Hooper, under the circumstances in proof?
The second and third prayers of the appellant presented substantially the same-question, only varied in the form of stating it. By the first =of these the Court was asked to say to the jury, that in order to affect the title of the bank to the note in controversy, it was necessary to show that it acted in bad faith in taking the note from James A. Hooper, and that there was no evidence in the case legally sufficient to show such bad faith; and in the next, the Court was prayed to instruct that there was no evidence in the case legally sufficient to show that the bank, at the time of making the loan mentioned in the evidence, had knowledge or notice of any limitation of the authority of James A.' Hooper to deal with the note in question.
It is certainly true, if a bank or other party take a negotiable hill or note before maturity, for consideration and without mala ftdes, such party acquires a good title, notwithstanding there may have been negligence; and gross negligence even, while it may be evidence of mala fides, will not alone be sufficient to defeat the plaintiff's title. This is now the settled principle in England, and, generally, in this country, and it has been fully adopted in this State. In the recent case of Maitland vs. Citizens’ National Bank, 40 Md., 540, 568, where this question was last under consideration, this Court declared that nothing less than proof of knowledge of facts that showed the want of authority of the party transferring the note would be
But the question is, on the prayers of the appellant, whether there was evidence legally sufficient to be submitted to the jury from which they could find that the appellant had knowledge, at the time of the transaction, that the note did not belong to James A. Hooper ; for if the appellant had such knowledge the note was not taken bona fide and no title, as against the appellees, was acquired by the pledge. And, upon careful examination of the evidence as set out in the record, we think it was legally sufficient to be submitted to the jury upon the question of notice.
Mr. Guest, the appellant’s cashier, proved, that on the 16th of March, 1875, James A. Hooper, who was well known to the appellant to be a stock and bill broker, whose business it was to sell paper for other people to
With this evidence in the case, we think the Court below committed no error in rejecting the two prayers of the appellant. While the evidence did not go to the direct proof of knowledge as to the real ownership of the note at the time of its deposit with the bank, yet the circumstances are strong from which a jury might find the fact of such knowledge ; or, at any rate, they could well conclude that the appellant had knowledge at the time of the deposit of the note that it was not the property of James A. Hooper, to whom the loan was made. The note was placed in the hands of James A. Hooper to be sold for account of the makers and indorsers ; and, as we have already stated, if the appellant knew that the note was not the property of James A. Hooper, the taking of the note by way of collateral security for a loan to the agent imparted no title as against the principal. Treuttel & Wurtz vs. Barandon, 8 Taunt., 100.
And now, turning to the prayers of the appellees which were granted, we find no error in them. The second prayer put the plain proposition, and that only, which we have just stated, in reference to the effect of notice upon the title acquired by the pledgee. In regard to this we think there ought to be no question. Nor is the proposition involved in the appellees’ tenth prayer, also granted, less free from doubt. Indeed, we do not understand it to
In conclusion we may say, that by the several prayers which were granted, it would appear that the jury were fully and fairly instructed as to the law of the case, and upon review we discover nothing for which the judgment should be reversed.
Judgment affirmed.