First Nat. Bank v. Eason

Key passage — most relied on by later courts

““The appellant has two obligations of the bankrupt, one is on a note for $15,000, of which the bankrupt was maker, the other is on an indorsement on a forged note for $15,000, given as collateral to secure the first-mentioned note. The appellant seeks to prove both obligations against the bankrupt’s estate. There was only.one consideration, really only one debt, and the appellant is entitled to only one satisfaction. The payment of either obligation would extinguish the other. The district court held that the appellant could not prove both and thus establish a double liability against the bankrupt’s estate. The decree appealed from is affirmed.””

quoted by 1 later decision, including Hitner v. Diamond State Steel Co.

““A creditor holding the note of a bankrupt, and, as collateral security therefor, another note on which the bankrupt is also liable, is not entitled to prove his claim against the estate in bankruptcy for both, but only for the amount of the actual indebtedness to him.””

quoted by 1 later decision, including In re Battle Island Paper Co.