Comstock v. Hannah

Citations

• 76 Ill. 530

Syllabus

<p>1. Assignee oe note—negligence in inquiring into consideration hefore purchase. In a suit by the assignee before maturity, against the maker, upon a promissory note, where a failure of consideration was set up, averring that plaintiffs had notice of the same, the court modified one of the plaintiff’s instructions, by adding the following: “unless the jury further believe that the consideration of the note in suit was for the sale of a patent planter, and the right to sell the same under conditions named in the evidence, and that the plaintiff's, or their agent, at the time of the purchase of the note, had notice of what the note was given for; and in that event it would be the duty of the plaintiffs to use a higher degree of diligence in informing themselves of the consideration of such note than would be required of them in purchasing ordinary commercial paper not connected with patent-right transactions:” Held, that the modification was clearly erroneous.</p> <p>3. Same—effect of gross negligence in purchasing note before due. Where a person takes any assignment of a promissory note for a valuable consideration, before due, and is not guilty of bad faith, even though he may be guilty of gross negligence, he will hold it by a title valid against the world, and it will not be subject to the defense of failure of consideration in his hands.</p> <p>■ 3. A party who takes commercial paper before due for a valuable consideration, without knowledge of any defect of title or defense to it, will take a good title unaffected by any defense going to its consideration. Suspicion of the defect of title, or knowledge of circumstances which would excite such suspicion in the mind of a prudent man, or gross negligence on the part of the assignee at the time of the transfer, will not defeat his title, or let in a defense not otherwise admissible against it in his hands. That result can only be produced by bad faith on his part.</p> <p>4. In a suit by an assignee of a note, take