149 F. 127 (2nd Cir. 1906), 247, Van Zandt v. Hanover Nat. Bank

Docket Nº:247.
Citation:149 F. 127
Case Date:October 11, 1906
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

Page 127

149 F. 127 (2nd Cir. 1906)




No. 247.

United States Court of Appeals, Second Circuit.

October 11, 1906

Page 128

E. B. Whitney, for plaintiff in error.

P. S. Dudley, for defendant in error.

Before WALLACE, TOWNSEND, and COXE, Circuit Judges.

WALLACE, Circuit Judge.

The question whether the plaintiff (as receiver of the American National Bank of Abilene), or the defendant, was entitled to the possession of the four promissory notes which came to the hands of the defendant in January, 1905, depends upon the following facts: The defendant had been for some time the New York correspondent of the Abilene bank, and the Abilene bank had kept with the defendant a deposit account, making deposits and withdrawing them by checks, bills of exchange, etc. From time to time it forwarded notes or commercial paper made by various persons and owned by itself, indorsing said paper, and offering it to the defendant for sale with a request that in case the defendant purchased the paper the proceeds thereof should be deposited in the deposit account. November 27, 1903, the Abilene bank signed a written contract of hypothecation by which it agreed with the defendant--

'That all bills of exchange, notes, * * * money, and property of every kind owned by the undersigned * * * deposited with the said bank, or which may be in any wise in said bank, or under its control, as collateral security for loans or advances already made, or hereafter to be made, to or for account of the undersigned, by said bank, or otherwise, may be held, collected, and retained by said bank until all liabilities present or future of the undersigned * * * of every kind of said bank, now or hereafter contracted, shall be paid and fully satisfied.'

In January, 1905, the four notes in controversy, made by third persons and indorsed by the Abilene bank, payable, three of them, respectively, in 90, 60, and 30 days, and one of them in 6 months, were forwarded by it from Abilene, Tex., to the defendant, by mail, with instructions: 'We hand you for discount and credit. ' The defendant received two of them January 14th, and two of them January 16th, and immediately notified the Abilene bank, by telegrams and letters, that the paper was not satisfactory. After the first two notes had been mailed to the defendant, but before it had received notice of the defendant's...

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