Case ID: la-ann_25/html/0050-01.html
Source: Caselaw Access Project
Author: {"author": "Howell, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

No. 3957.
    City of New Orleans v. J. Strauss. E. Merle and J. Chapus, Warrantors.
    Wliere a certificate of indebtedness wifcb tbe date and number wanting, was stolen, while being prepared for issuance, before it was issued and put in tbe market by tbe city of New Orleans, and alter tbe date and number bad been subsequently forged, was sold to tbe defendant, who called bis vendor in warranty;
    Held — That this instrument can not be classed as negotiable paper upon which tbe maker is bound to innocent holders. It is transferable, it is true, but tbe transferree obtains only tbe rights of tbe transferrer.
    In this case tbe transferrers and warrantors bad no legal possession of tbe certificate of indebtedness of which the city of New Orleans never ceased to bo tbe owner.
    APPEAL from the Fourth District Court, parish of Orleans. Ihéard, J.
    
      George S. Lacey, City Attorney, for plaintiff and appellee.
    
      O. Poselius á Alfred Philips, for defendant and appellant.
    
      Says ds Seiv, for warrantors.
    Justices present and concurring: Ludeling, Taliaferro, Howell and Kennard.
   Howell, J.

The city of New Orleans claims the sequestration and possession of a certain certificate of indebtedness in favor oí J. Fallon or bearer for $775 65, found in the possession of the defendant, Strauss, and alleged to have been stolen in a state of incompleteness from the office of the Administrator of Public Accounts. The defendant answered that he purchased said certificate in due course of business from E. Merle and J. Chapus, and it being a negotiable instrument his title as an innocent third holder is good. He called his vendors in warranty, whose answers are substantially a general denial, Chapus specially denying any connection with the matter. From a judgment in favor of the city and one against the warrantors in solido, in favor of defendant, the parties cast have appealed.

The evidence satisfies us that the “certificate” was stolen from the office of the Administrator of Public Accounts, before it was in a state or form to be issued, and that the deficiencies were supplied before the sale to defendant on the same day of the theft. But we can not class this instrument as negotiable commercial paper, upon which the maker is bound to innocent third holders. It is transferable, it is true, but the transferree obtains only the rights of the transferrer. See the case of the State ex rel. S. Smith & Co. v. James Graham, Auditor, recently decided. Strauss obtained no title, and the city was correctly held to be the owner.

We concur in the opinion of the judge a quo that the warrantors have not shown a legal possession of the certificate, and that they must be condemned to pay to Strauss the amount paid by him to them for the certificate.

Judgment affirmed.

Rehearing refused.