29 Iowa 258 | Iowa | 1870
The only real question in this case is as to the correctness of this instruction given by the court to the jury: “ Although the note may have been procured by fraud, perpetrated by the payee of the note, or his agents, yet if plaintiff-took the note before maturity in the ordinary course of business and for a valuable consideration, such fraud would not be available as against plaintiff as a defense, until it is shown that the plaintiff had notice of such fraud, or, such facts and circumstances as would have put a reasonable man upon inquiry in relation to the same."
The latter part of the instruction is misleading and erroneous. The course of the English authorities upon this question, and the re-establishment of the early doctrine of Lord Kenyon in Lawson v. Weston, 4 Esp. 56, after it had been overruled by Gill v. Cudit, 3 B. & C. 446, is concisely given in Gage v. Sharp, 24 Iowa, 15. The American authorities are ■ not essentially different from the English in their course and present conclusion. The early and present doctrine is, that the right of a bona fide holder for value, in the usual course of business, of negotiable paper, cannot be defeated by proof that he was negligent, and omitted to make inquiries which common prudence would have dictated.
The case of The Trustees of Iowa College v. Hill, 12 Iowa, 462, is not in conflict with this doctrine. It is there said that plaintiff; “ are not to be charged with notice because of any want of diligence on their part in making inquiry, or even if they took the note under sus
Beversed.