Court Opinion

ID: 9298964
Source: CourtListenerOpinion
Date Created: 2022-12-02 17:05:34.311796+00
Date Added: 2024-06-11T17:13:36.406227
License: Public Domain

McKENNAN, Circuit Judge.
Is the holder of a negotiable note, who has taken it as a security for a pre-existing debt, a holder for' value, «and so protected against any equities subsisting between the original parties to it? This is the only question presented by this case. If the rule established in Pennsylvania by the decisions of her highest court is to be followed, it must be answered in the negative. But these decisions are only persuasive. as may be said also of a recent decision in this court by a late eminent judge conformably to the state rule. The question involved is not one of local law, but of general commercial jurisprudence, hence the duty of the court is imperative to follow the guidance of general judicial opinion concern*799ing it. As to the preponderating weight of this opinion there is scarcely ground for doubt In perhaps a majority of the United States, the law is settled that the taking of a note as collateral security for a pre-exist-ing debt is a holding for value. So it is held in England. See Percival v. Frampton, 2 Cromp., M. & R. 180, and Poirier v. Morris, 2 El. & Bl. 89. It is stated to be the better doctrine in 3 Kent, Comm. 81; in Story, Prom. Notes, § 195; in Pars. Prom. Notes, 218; and in Byles, Bills (By Sharswood) 28. It has the judicial sanction of Judge Story, in Swift v. Tyson, 10 Pet. [41 U. S.] 1, where the adoption of it is distinctly approved by the supreme court, in McCarty v. Root, 21 How. [62 U. S.] 439. Such weight of authority must be regarded in this court as decisive, and judgment is, therefore, entered for plaintiffs on the case stated.