The Abbeville press and banner. [volume] (Abbeville, S.C.) 1869-1924, 1879-10-08

cations issued by munlclpei corporations, &C.,
they are transferable by delivery, and.
when issued by competent authority, pass into
the hands of q bona tide purchaser for value be-
fore maturity, freed from any intirmlty in their
origin. Whatever fraud the officers authoriZ ed
to issue them may have committed i'll dlspoSlnS
of them, or however entire may have been the
failure of the consideration promised by parties
receiving them, these circumstances will not af-
feet the title of subsequent bona tide purchasers
for value before maturity or the liability of the
municipalities. As with other negotiable paper,
mere suspicion that there may be O defect OF title
in its holder, or knowlcdgeof circumstances which
would excite suspicion as to his title IN the mind
of q prudent man, is not sufficient to impair tho
title of the purchaser. That result will only fol-
low where there has been bad faith on his part.
Such is the decision of this Court, and subse-
Lardner G Wall, 100 That is a very strong
case upon the subject. The facts, in brief, were
these: Negotiable bonds were stolen from Lard
ner and sold to Murray, q broker in New York,
unlcr circumstances well calculated to excite his
suspicion, though there was no proof of any ac-
tuaf guilty knowledge on his part-the compliant
against him being that he did not prosecute the
inquiry which such circumstances of suspicion
naturally suggested. The Court, after an elabor-
ate review Of the English cases, held that no was
not bound to do 80; that tho possession of re-
gotiablo paper Is ~presrmptive proof OF good title,
and the burden of proof is upA him who assalls
the right claimed by the party in possession, and
laid down tho rule in very much the same lam
snage as that above quoted, declaring it to be
settled law from which there was no dispersion to,
depart.
table securities and the holders thereof are bona
tde holders our next inquiry will be as to the
rule governing that class of securities i'll tho
hands of such holders. The rule, as stated by
one Of the most recent writer's on this branch of
commercial law, is that if such holders, unaffect-
cd by, and exempt from inquiry into, the circnm-
stances under which they were put into circula-
tim.-2 Dan. OH Negotiable Instruments, Sec
/, 502-3. Now, rs corporations Of States issuing
such paper must necessarily do so through the
fundamentally of officers or agents, the only III
m1iry in such cases is whether tho officer or agent
has been entrusted with authority to make and
issue tho paper, and it is not competent to inquire
into his conduct i'll making the issue. If he has
been guilty of irregularities or even frauds m
exercising the power with which he has been Ell
trusted, the loss thereby occasioncd must fall
upon the party who entrusted him with sEch
power and not upon the innocent holder who has
taken the paper in tho usual course of trade.
The rule AZ stated IN Supervisors VIZ. Schcnck %
Wall, ISL, is: "When q corporation has power,
under any circumstances, to isSlo negotiable Sc
%curitics, the decision of this Court is that the
bona tidc holder has the right to presume they
were issued under the circumstances which givo
the requisite authority, and they arc no more
liable to be iInpcached for any inlirmity in the
hands of such holder than any other commercial
paper" And this rule has been rcatlirlncd in tho
recent case of San Antonio vs.. Mehaffey (9G u. 5.
l;cp., 314, and again III the still more rccent case of
County OF Macon VS.. Shores, (97 U. S. ltcp.. 278-
81 In the case of tho Commissioners of Knox
County vs.. Aspinwsll, (21 How, SIS, it was held
that, where bonds have been issued by the Board
of County Commissioners, under the authority of
IN Act ofithe Legislature Which prescribed certain
conditions upon which the bonds were to be is