Citizens National Bank of Covington v. McDannald

Citations

• 116 Va. 834
• 83 S.E. 389
• 1914 Va. LEXIS 95

Syllabus

<p>1. Bills and Notes&emdash;Gaming Consideration&emdash;Bona Fide Holder&emdash;Negotiable Instruments&emdash;Code, Section 2836.&emdash;The fact that the endorser of a note knew that the proceeds of the note were to be used by the maker in gambling in stocks cannot affect the rights of the hank which discounted the note for the maker in ignorance of the use to be made of the money. It is the of a bank to lend money and it is under no obligation to inquire of the borrower what he wants the money for, nor is it to be affected by any use which the borrower chooses to make of the money. Such a discount by the bank is not within the purview of section 2836 of the Code, relating to gaming</p> <p>2. Bills and Notes&emdash;Gaming Consideration&emdash;Bona Fide Holder&emdash; Transfer to One with Notice&emdash;Negotiable Instruments.&emdash;Such a note as is mentioned in the preceding paragraph being valid in its creation, it is not affected by the circumstances that it subsequently passed into the hands of the endorser, who had notice of the object to which the avails were to he applied. The general rule is that if a person with notice purchase from one without notice, he is entitled to stand in the latter’s shoes, and take shelter under his good faith.</p>