Court Opinion

ID: 9444470
Source: CourtListenerOpinion
Date Created: 2023-08-03 21:01:57.043367+00
Date Added: 2024-06-11T17:29:53.003635
License: Public Domain

RIVES, Circuit Judge
(concurring specially).
I concur in the affirmance of the judgment and in much that is said in the opinion of the majority. However, I would not overlook the fact that the district judge further stated in his oral opinion, “I think we can say there was no notice to these people in these notes that they were holders of the notes in due course for valuable consideration.” That statement, in the context in which it appears, seems to me ambiguous. The judge may have meant that there was no notice to other creditors of any claim that the appellant was a holder in due course; or he may have meant that the appellant had no notice of any defects in the notes and was in fact a holder in due course.
If there was a finding to the latter effect, then of course the security would follow the debt. The bankrupt and the growers could be estopped to deny that the chickens in the custody or possession of the growers were the property of the growers subject to the chattel mortgages, that the mortgages were genuine and the notes valid obligations. Such estop-pel, however, would not extend to the trustee in bankruptcy. In his position as a creditor holding a lien on the bankrupt’s property, the trustee, or in this ease the receiver, had a right to pierce the form and show the true facts.
Further, the appellant, in its course of dealings, consistently permitted the bankrupt to receive the chickens from the growers and to sell them along with other chickens as if they were the bankrupt’s property. Other persons were justified in extending credit to the bankrupt on the assumption that the chickens were its property, and the appellant cannot now be heard to deny as against the trustee in bankruptcy that the chickens belonged to the bankrupt.
I, therefore, concur in the affirmance of the judgment.