Opinion
(Filed November 5, 1901.)
NEGOTIABLE INSTRUMENTS — Bills and Notes — Transfer Before Maturity — Bona fide Holder — Acts 1899, Ch. 733, Secs. 25-27.
An assignee of a negotiable instrument to secure a debt due him was not a bona fide purchaser, without notice, where he paid no money in consideration of such assignment, until made so by Acts 1899, Ch. 733, Secs. 25-27.
ACTION by A. F. Brooks against J. H. Sullivan and J. B. Gerringer, heard by Judge E. W. Timberlake and a jury, at January (Special) Term, 1901, of the Superior Court of GUILFORD County. From a judgment for the defendants, the plaintiff appealed.
T. B. Womack, for the plaintiff.
J. T. Morehead, for the defendants.
The only question is whether, when a negotiable note is transferred before maturity as collateral security for a pre-existing debt, the assignee is such holder for value that he takes free from equities of which he had no notice. The "Negotiable Instruments" statute, Acts 1899, Chap. 733, secs. 25-27, settles that such is the case now to the extent of the debt secured, but that is a change of the law, which was previously otherwise. Holderby v. Blum, 22 N.C. 51; Harris v. Horner, 21 N.C. 455, 30 Am. Dec., 182; Potts v. Blackwell, 56 N.C. 449. This case is governed by the law as it stood prior to the act of 1899.
Affirmed.