Citizens Bank & Trust Co. v. Limpright

Citations

• 93 Wash. 361
• 160 P. 1046
• 1916 Wash. LEXIS 1206

Syllabus

<p>Bills and Notes — Bona Fide Holder — Duties—Evidence—Sueeiciency. There can be no imputation of bad faith from the fact of taking negotiable paper, fair on its face, without active inquiry, nor by mere speculation as to diligence or negligence, and evidence going no further, and showing no actual notice, is insufficient to sustain findings that plaintiff was not a bona fide purchaser for value.</p> <p>Same — Bona Fide Purchaser — Collateral Executory Agreement —Notice—“Defective” Title. Where defendant gave a note for the full purchase price of an automobile, with a collateral executory agreement that the valuation of his old car, traded in at the time, instead of being then credited, should be applied in part payment of the note sixty days hence, the plain purpose was to enable the seller to raise money on the note, and knowledge thereof would not charge a purchaser with bad faith or make his title “defective” under Rem. 1915 Code, § 3446; since he did not obtain it by fraud, duress, unlawful means or for illegal consideration nor pledge it in breach of faith, no breach of the executory agreement having occurred.</p> <p>Same — Bona Fide Holder — Amount of Recovery — Discount. Under Rem. 1915 Code, § 3418, declaring that, where the holder has a lien on the instrument, he is deemed a holder for value to the extent of the lien, a bank taking a note as collateral to a loan for eighty per cent of its face, can recover from the maker, having a good defense as against the payee, only to the extent of the lien, with interest at the legal rate, in the absence of any evidence as to the rate of interest agreed upon.</p>