| U.S. Circuit Court for the District of Eastern Virginia | Jun 15, 1877
It is useless to pass upon any other question raised in the pleadings except the single one on which the case rests. That question is, assuming these bonds and their coupons to be commercial paper, payable to bearer, transferable by delivery, whether or not the admitted fact that they had been stolen invalidates the title of their bona fide holders by purchase at the market price of such bonds.
It is no longer a question that the bonds of corporations payable to bearer are negotiable paper, at all times after they get upon the market, up to the date of their maturity. This is an elementary principle of commercial law. Nor is there any doubt, since the' decision in Mercer v. Hackett, 1 Wall. [68 U. S.] 83, that the interest coupons of such bonds not yet due are also negotiable paper. It may also be assumed, as the settled law of this country, as it is of England, that a bona fide holder, for value, of negotiable paper, in the form of the bonds and coupons in this case, by purchase before their .maturity, is entitled to recover his demand from the maker or obligor, even though his vendor •obtained them by fraud, or theft, or robbery.
In general, the purchaser of personal property obtains no better title than that of his vendor, unless, in England, he purchase in certain markets overt. But, for the benefit ■of commerce, this rule is reversed in respect to negotiable paper, and the holder of such paper, though it has been stolen, has title to it if he himself came to it bona fide in The regular course of trade, and the burden of proof is upon the defendant to disprove the bona tides of his purchase. This principle is too thoroughly established by the decisions of the supreme court of the United States in Murray v. Lardner, 2 Wall. [69 U. S.] 110, National Bank of Washington v. Texas, 20 Wall. [87 U. S.] 72, and Hotchkiss v. National Banks, 21 Wall. [88 U. S.) 354, to be questioned here; however strong our inclination may be to protect the state of Virginia from such a theft as these bonds were in part the subject of.
But clear as the principle of these decisions is, as to the principal of the bonds sued upon in this case, and as to the coupons which had not yet matured at the date of the plaintiffs’ purchase, it is well-settled law that the eight coupons which were then past due were not such negotiable paper as falls within the scope of the principle. As to those overdue coupons, the plaintiffs took only the title of their vendor, who called himself Taylor, which was no title at all. See Arents v. Com., 18 Grat., at pages 777-780, and numerous cases there cited by Judge Joynes. Judgment may be entered accordingly.