Court Opinion

ID: 3866308
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:00:08.916224+00
Date Added: 2024-06-11T13:51:35.433100
License: Public Domain

We think it settled, by the current of American authority, that a coupon bond, like those set forth in the plaintiffs' declaration, is negotiable, and that its coupons are also negotiable, and may be detached and negotiated by simple delivery, and sued on separately from the bond. The Supreme Court *Page 380 
of the United States, in White v. the Vermont andMassachusetts Railroad Co., 21 How. 575, 577, held that such bonds were negotiable, basing their opinion on the intent to give them a negotiable character, as shown in the form in which they are issued and put in circulation, and on the usage and practice of business men dealing in them, as well as the decisions of the Courts. In County of Beaver v. Armstrong, 44 Penn. 63, it was held that the coupons of a railroad bond may circulate with the bond, or separately, and may be sued on entirely independently of the bond to which they were originally annexed. The case ofCommissioners of Knox County v. Aspinwall et als. 21 How. 539, 546, is to the same effect. Mr. Justice Nelson, in delivering the opinion of the Supreme Court of the United States, in the latter case, says: "A question was made upon the argument, that the suit could not be maintained upon the coupons without the production of the bonds to which they had been attached. But the answer is, that these coupons or warrants for the interest were drawn and executed in a form and mode for the very purpose of separating them from the bond, and thereby dispensing with the necessity of its production at the time of the accruing of each installment of interest; and at the same time to permit complete evidence of the payment of the interest to the makers of the obligation." And see Thompson v. Lee County, 3 Wallace, 327, and cases cited on the plaintiff's brief.
In the case before us, it is argued that the action is on the bonds, and that it cannot be maintained because the bonds have been paid and surrendered. And, indeed, to sue on bonds which had been paid and given up would not be consistent with legal principle. But in this case the action is not on the bonds, but on the coupons, as separated from the bonds. The plaintiffs do, in the special counts of their declaration, set forth the bonds by way of inducement, but they found their claim on the coupons, expressly averring that the coupons had been detached before the bonds were paid and surrendered, and that they were subsequently presented by them as the owners and holders, as separate demands on the defendants, and payment refused. But even if the special counts were open to the objection made by *Page 381 
the defendants, there is, in the declaration, a general count in debt, under which the plaintiffs can prove their claim, which is not open to the objection.
It is further contended for the defendants, that the coupons have no validity except as accessories of the bonds, and that the bonds having been extinguished by payment, the coupons are also extinct. But, if it appears on the record that the bonds have been paid and surrendered, it also appears that the coupons had been previously detached; and having thus, according to the cases we have cited, lost their character as mere incidents of the bonds, and become an independent claim, we are of the opinion that the payment of the bonds could have no effect on their validity. Indeed, to hold otherwise would thwart, if not defeat, the very purpose for which the coupons were made separable from the bonds.
The demurrer should be overruled, and the plaintiffs have judgment for the amount due on their coupons, with interest from the time of demand.