Collins v. Gilbert - 94 U.S. 753 (1876)
U.S. Supreme Court
Collins v. Gilbert, 94 U.S. 753 (1876)
Collins v. Gilbert
94 U.S. 753
1. A negotiable instrument, payable to bearer or endorsed in blank, produced by a transferee suing to recover its contents, is, when received in evidence, clothed with the prima facie presumption that he became the holder of it for value at its date in the usual course of business, without notice of anything to impeach his title.
2. The title of a bona fide holder for value of an accepted draft, endorsed in blank, is not affected by the fact that the party from whom he received it before its maturity had possession of it for certain purposes, and misappropriated it.
This suit was brought by Gilbert & Gay against Thomas Collins upon his acceptance of a certain draft for $8,000, drawn by P. F. Collins & Co., to their own order, and by them endorsed in blank.
The firm of P. F. Collins & Co. consisted of P. F. Collins and John M. Moorhead, who were, as subcontractors, engaged in grading seven miles of the Connecticut Western Railroad, then in process of construction. The contractor with the railroad company was one Barnes, who was to pay them monthly for work done, less fifteen percent retained to secure the proper completion of their contract with him, but they were unable to proceed with the work unless he advanced the retained percentage. He agreed to do so if they would give him as security for their execution of the contract, to be held by him for that purpose, an acceptance of Thomas Collins to the amount of $8,000.
The draft accepted by him was accordingly given to Barnes, for whom it was discounted by the plaintiffs. The jury found for the plaintiffs, and, judgment having been rendered upon the verdict, the case was brought here.
The errors assigned are grounded upon the exclusion by the court below of certain evidence offered by Collins, a statement of which is given in the opinion of the Court.