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W'Y'LIE ro,
ft. MISSOURI PAC.
RY;:Co,.' ,
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(Of,rew!t Oourt, S. D. New York. FebruMiy 18/1800.) ,,/
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,"Certain negotiable bonds.i>art of a large is!lue mad6 by a railroad corporation, and numbered consecutively, owned by the plaintiff, were stolen; ,the numberi al,: I!laturity !/ondforvalue bya pur,In a ,SUit ,against to re60yertM amount of the bonds by tbe, or,,igtnal oW,ner. held: (1), T,bat, i.,h,e Origin,aI, ow,n,e,r" ,CoD,1,d not recov,e,r l,'ft,hi:l,' in :tlj.e of a purcha,ser wp-o .acquired good them,. :(2) 'l'hat the obligation represented by the bonds was not annulled by the alterM;ion of the serial numbil1'!l' made'by a' the privity of the as the numbers were a matter to pontr9,Ct, and not,s teriil part thereof. ' , , , ·. , : ' ; f)
BONDS-SBltUL, NUMlIERt-:-ALTEJUTION AND, SALE
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'wsa aI1l1.ction fltoiigblby Wylie agi1.irist !the MissouriPaeitib Raihyay 'CQm,pany, to 'recover'rnoneydlleoncertain bonds stoleI1lrom plain.tiff.' '" ' ,' ',' , , Artem.1l8 Holml?8,' for lllaihtiff. !/ WinBlOw S. Pierce, for defendant. ' i'
At' Uw. ,Action
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'" WA:t¥ACE, J.; In January: 1876, certain 'rlegdtianle bonds, forttJOOO rllJ¥1e by the CoIlipanr partdfah 7,000 bonds ot'Hke tenor, then QwnecFby 'th.e plliintiff, were stolen 'from a vault of the "Northampton NlI.ti6nal :Bahk,whel'eshe had left them for safe-keeping. , The bonds, like'l,tll of tHe issue, were numbered.' The defendiinthas' succeeded ,tothe:liability of the 'Pacific Raihoad. of Missouri" all'd' 'starids in the positidn'.of the original obligor (or the payment of the bonds. The plaintiff, na"ing tendered as,uBicient tne defendant, againSt it to recover the amount ofth'e Dimds. 'fhe defenqatit hllS'provedthttnne bonds are in thehl\ocls' cifa'bona fide holder; :who' purchased fore'iliatu'rity and 'for after they were stolen, butafter' tHe'Dumberson thehonds had altered byera5u,re and a, substitution 'of other :nulIlbers. As no one, except the thief orsorhe confederate 'could have hfidahy 'object in making the alterations,'it is reasonable to asthis was done, .bY some person particeps etiminu;inorder to instrumentawith less risk. ,The' alterations werasa skillthittthey'cou'1dnot be detected, by: the purchaser."It is 'plain thatiftpe purchaseraoquireda valid title to the bonds 'as against t'he plaintiff, 'she has no cause of action against the defendant,l:lecause all her rights have vested in' the purchaser, and the defendant is liable .to him upon the defendant· cannot be liable,both to 'the ,purchaser 'and to ,the .plaintiff. , The bonds being negotiable, the promi,a,e to,p8X 'runs, to th(nbider, and, ifhebM' acquired t,heth btina fide and f9"f p!AiI/-tiWs gone,. aj):d the:pr9mi!!e' by JheMy.xnept; to holdl'll'liL.cCordtng to , . ", " " It is fafu.iUnr law\hat, a alteratioQi ipifll'lgotiable intentionally by the owner, avoids the obligation. An alteration, although in a material part, made by a stranger without ,the ! pri\TItt of
RlilPORTEJ1, vol.
the owner, does not defeat the right of the latter to recover upon the contract. So, also) where the alteration is made by the owner, but is accidentally made, or is in an immaterial matter, not varying the legal effect of the contract, he may still.recover upon the obligation. Bees v. Overbaugh, 6 Cow. 746; Nichols v. Johnson, 10 Conn. 192; Braum v. Pink9B.Mon. 25; Barrington v.Banlc, 14 Sergo & R. 405; Or08wellV. Labree, V. Arn()t. ,57 N.Y:t253. It is of M consequence in the pi-esent case that made by the thief.. , If it was of the title of the plaintiff to the bonds, If 'it was ofaLD.laterial' part, the bonds bought bybim were not the genuine bonds. The case' resolves itself, consequently;'into the single question oflaw, whether the. alteration of the serial number of a bond is a material alteration. If it is, it. the obliga. of aq ;pufcqaser who pu,rchased it for value. before the upon a note, check, or bond is only intended to serve the convenience of the maker or owner in distinguishing it from others of a similar tenor. Where bonds are a part of a large issue, exactly except as to numbers, the numbers aflord a protection to the owner and obligor, against loss through qal:(jlesslWsS:Of crime,: practical value. They give :tothe, [;\bligor ,the meanl;l a bond which is pre,l!eIltec(for paid or not; and to the holder the cqe,ekiIig its of tracing and identifying his propEjrty, ,w pas beell wrongfully taJte1l fr,om him. .Neyertheless, these matters extrinsic for this reason it may ,weH b.e that an alteration. of the number is not, in· the case of .ordinarYbonds,a material 'on.e: "But there are negotiable bonds in ,which thenumbl;lrs qontract, if, into the contract, the,bplder, and. the obhgor; ,I),S where corporate !lore c,1asses some of which are ,s,ul;>jectto at of the ob,ligor int() other securities, or to payment before maturity, ptber special cOllditi9ne, while the ;rest are not. to such bond$,i'fhen the number determines the right .of exercising the option, to be as vital in qualifying the ,l)Ontract as any other part instrument. Of course, it is immate.rial whether the special'CQnditjqns are recited in the bond itself, or ,whether,they are contained In the mortgage:secunng the issqeofbonds; :bothinstruments are to be in ascertaining the terms of t1;le contract. The observations onhe master of the rolls iuSuffell v. Banlc,9Q: B. Div. 555, areiti' poirit.· say:s; , OJ "In an ordinary case. it may be said that changing the number put on a ,bill ,of exchange. or on a check.,,,,m not: affeot, the contract. and may not bea But. taj!:e debenture issued by a company, or 1l1:lp,mllssued bya turJ;lplke tr,!Wt ,and that till! bond 18 pa1d accordinp:to the nUIPbel' tlra\Vrrby lot, Whicqis a very COmmon mode of payment. There, althO'Ugl1tb,e nu'mberwould not affect the contract on ·Ilheface of the instrument,· itTeallywould affetlt the contract in another way,
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ham. J8,
1 N. H.
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WYLIE fl. J4ISSOUR![ PAC. BY.
co.
625
and I shoUld think there would be no doubt in the world that in such a case the bea material alteration in theinstrument." an Except cases in which the numbers enter into the contract on the face or dehor8 the instrument,'the law as stated in Jones, Ry. Sec. § 216, may be. accepted as the doctrine of the American decisions. "The alteration of thenumber of a negotiable bond not required by law to be numbered, inasmuch as it does not change the tenor of the bond, is immaterial; allel, although made with fraudulent intent, does not avoid it against a holder who takes it afterwards in good faith, for value. without notice of the alteration, or reason to suspect it. Marks ofsucll alteration, when slight only,wil1 not discredit the bond in the market, or deprive the holder of the protection of a bona jlde holder. A purchaser of such bond in open market is. not. bound to make a close an(l critical examination. of it to escape the imo( bad faith in the purchase. II . Two courts of last resort in this country have explicitly decided that the alteration of the numbers of negotiable bonds is an immaterial one. ·In Qnn. v. Bank, 98 Mass. 12,the case was a bill of interpleader filed by the: attorney general of the state, under a special statute, against t11e .savings bank and one Houghton, to determine whether five bonds of the commonwealth had ·become void as against the commonwealth by reMon of the alteration of their numbers. . The bonds had been stolen from Houghton, their numbers. had been subsequently altered, and afterwards they had been purchased in goqd faith and for value by the savings bank. The court held that the saVings bank acquired good title to the bonds. Discu8jling the argument. that the number of the bonds constitutes a part of the instrument, the court say: "It is a part of the identity of the papel', but not of the contract, any more than any device, picture, or impression upon it would be·. The presence or absence. of the number does not change the written contract, in substance or in form, nor affect the proof of it. ... ... ... We think the change of the numbers .was not a material alteration of the bonds." In Ouy.oj Elizabeth v. Force, 29 N. J. Eq. 587, the bill was filed by the originafowner of certain negotiable bonds, b,y the city ,beth, to .recover the money due on two of thllm, .which had been stolen from her, and the number of one of which had been altered before.it was presented for payment to the city. The bond was paid by the city,tllthough a bond bearing the same number as that of the altered bond had been previously paid. The court held that the plaintiff could not recover, because the alteration was an immaterial particular. The court said: "ThenuQlber of the bond is put upon it as a mark. denoting, for the convenienceand pr\)tection of the maker, that it is one of aseries; but suchmark does not enter into or in anywise affect the agreement embodied in it. The to do. with it, and need giveltn()-heed." purchaser has Qf course, if the alteration of the bond was an immaterial one, the city wasjustifieq in paying it to anyone who appeared to be the lawful .owner. it was declared in Bi1'd$aU v. RU88ell,29 N. Y. 220, that the alteration of the numbers in negotiable b,onds was not an alteration v.41 F.no. 11-40
tliepurcI1l1ser received the bonds under Buch BUsPlclotis"Cll'OUmstances the protection of a bonafide' the de..malon turned'upona question o,Haet:' The case of Suffel1t v.1Jank, gu,pra, is relied upon for the plaintiff ,as a'Ii'atithority'agains't adjudications. 'Uwtisi.'theni held, by thedOuit of appeal that tM alteration of a Bank , 'I1o,te.' erasing and su was' a and that a, bpn,a ,fide, holder for ,vlUue,could, not re'the note., ,The, "mamIY:uP(ln;the number, note is an of the1lote,'ibecause it has always been recognized to be So by tli411>ublic,'1lO that no' one' woul<ltake-it if the' number, were 'notupon it. ,Tbat consideration probably would n6t'a;pply to 'the :ca:se' of ordimi:ty , · ;:'!t; IV )Ji i,· , ,I Thei'decisionsof the :courts of1astiresortofMassaehusetbrand New Jersey! onght, to :prevail as authority' here;; rather ,tharl the, decision', of toe dtnglish\(lourtiof appeal, question. point now in Morgan 113 U.S. 588"and, ith,e decision in' that 'cAse is conLrolling upon thilf {lourt. ,Thatwas ian: 8kltioo'bl'ought by the purchasers tai'n':gov,eI1lment bonds, Iin ,wpieh the gover.niuent .OCQupied! thepositibn of a'i3tiPteholdetj lldmitting its liabiiity .t9 pay to the 'owrlers,to de.., termine, \tluether the dJr the bank, whieh' was the original -bands"and -from which,:they had. been' stolen, were' to recover their amount. After the stole&.' the· serial· num'bersware 'alllered,and they:were 'bought: by purchllBers for value and whhoutnotioo'l. is!!ts.ted by tht!'cottttin the opinion, t1;lere was;ndthiQg in of the aIteredbdtids or the'nmDt9 the or fJ. 'llers,' when and careful 'the,aHerl!-tioris havmg been so ,sJnllfullj effected 'that they Were Only disddvera'ble1with the ,aid Of a'magnH'ying glass.. ,The .bonds we'1'e boyi (s'tothe'pleasure of the 'United: States, i'npon,call1 , 'lst::day' of July;' 1870,arldhadbeen duly The effect of thelilteration ,hf the ntn'nbets)waa not disbussad in theopinioh 'of the court, the ques:tio'n'consMered: being' wbetbet'thebon'ds were overdue paper after th:e -day when i the,}tr1irst beClilntFrMeemable. The cOl1rtheld that the purJcl}aSel'SRcqu4fed. it vaHd·Htle"to:thebonds, andithisconclusion sarily implied that the alterations were immaterial. As was said by'bhe cout Mclaims;in BrO'Wnv. 'U.'S;l; 20Ct.'Cl. 416,'i1.'1referenceto :th:efttct 'of 'tIle,itlteratioil 'c()nstituhid 'llfiLCtorin the decision." ''Upon :the' thepresEmt action th!Lt the plaintiff cannot' r,ecoyer.. But'as, has been shown, irre'of' this! case, W, is th'a'li the . 0(' fuose (noW inoontlrov&rsy, in whieh the' numbers onlyi,Bcrve the collateral pMpose ofpr9tection and <1,0 notqirectly ,or 'tefintothEfteriol" 61' ·the contrtlct,are not'a material matter; .'1-'he defen!lantis.entitted fu.g 'decree. '
liwn
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HILLER·' 'V.'
LEVY
et at. February 18;1890.)
(01.rcu(t Court, S. D. New York.
PATENTS 'PORINVENTIONS--NoVELTIES-Bows FOR LADIES' WEAR.
The novelty of a" bow for-ladies' wear, "oonsisting in the interposition of a transverse reinforcing strip of annealed wire between the shield and the body of the bow, for the· purpose of pJ'O\'iding an adjustable, non-elastio backing fora bOW, whioh will maintain the shape into whioh it is bent, and to whioh the bow itself will conform, is not an inventiOn, wire tape baving previously been inserted in ladies' bows, and a similar boW; having 'been for two years in pUblio use in slippers.
In Equity. Bill by Hi1leragainst Levy and others to prevent infringement of patent. Arthur v. Brie8en, for. plaintiff. F. H. Betta, for defendants.
J. The of the /Chow for ladies' wear" which is thlt of the patent in 8uitconsists in the interposition of a transverse 'reinfol'cnng strip of annealed ,wire b.etween the shield, and the body ·of the bow, the object being to provide an adjustable, non-elastic backing for a bow, which will rnnintain the shl1pe into which it is bent. and to the bow itself will conform. 'The'specification admits that bows haVing an elastic shield were old; it is proved thatit was old, and \VeIl known, to'iilsert wire tape i'n' bows for ladies' wear, in order that the bow might be bent, and be retained in any shape given to the wire tape. The patentee has done nothing more than to transfer the location of the wire from inside the bow to a place between the bow and the shield. also show quite conclusively the pubThis is not inY,ention. The lic, prior use of the bow of'the patent in the slippers of Ordway &Cla:rk, in 1881, tn0re than two years prior to the date of the alleged invehtion of the , The bill is dismissed, with costs. ' WALLACE, 8U bject
O'NEIL et 'j
at. v. I .
& W. R. PACkET Co. et at.
(C4ircwU .Court, W. D. Tennes8ee. February 10, 1890.)
I.
A steam"boat while mpored at a wharf, with no steam up, "nd engaged in. receiving freight;, brlletied a supply of coal from coal dealers; 'l'l'Je'dealers sent their tug with a coa!rnet" latter was lashed to the steamer's side, for the purpose of enablingijie coal,tO be carried on board the boat. It was the duty of the dealers to , 'furnish the linesnecesiia.ryfor the lashing; but] not havIng enough, the boat allowed them to use,olle Aftertbe fiat was rastened to. the boat, the tug left it, leaVing on bilard two of the dealers' employes, whose duty it was to take care of ,the 1Iat, too ascertain and report the qUlU1tity of coal taken, and. lfanything happened
AT WlIARJl-DVTY TO PROTBCT COAL-hAT FROM DRIPT,
ll\evel'8ing811 F ed.,Rep.858.,·' :