First National Bank v. Stover

Citations

• 21 N.M. 453

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>1. A promissory note, containing the provision that “all parties hereto, * * * agree that this note may be extended from time to time by any one or more of us without the knowledge or consent of any of the others of us, and after such extension, the liability of all parties shall remain as if no such extension had been made,” grants no power to the maker or other parties' to the note to extend the time of payment without the consent of the payee or holder.</p> <p>P. 458</p> <p>2. A provision in a note in the foregoing form does not render the note non-negotiable under the law merchant or the provisions of the negotiable instruments law (Law 1907, c. 83.)</p> <p>P. 464</p> <p>3. The general principles, running throughout the whole law, that notice of facts which should put one upon inquiry and which, if followed up with diligence and understanding, would lead to the truth, has no application to the question of good faith in the taking of negotiable instruments. The question in such cases is, Did the holder have actual knowledge of the infirmity or defect, or knowledge of such facts that his action in taking the instrument amounted to bad faith? Suspicious circumstances, negligence, or willful ignorance may be evidence of bad faith from which the jury may find the fact. The holder, however, will be protected unless, at the time he took the paper, he had reason to believe, and did believe, there was some defect or infirmity in the paper'. The facts in this case examined and he!A not to authorize a finding that the appellant bank did not take the note in good faith; three being no substantial evidence to support any such finding.</p> <p>P. 471</p> <p>4. Sections 646, 649, 653, Code 1915, applied, and held that the plaintiff bank, under the circumstances, took the note in question charged- with the burden of proof that it took the same in due course. Held, further, that under the proof, that burden had been successfully met. Held, further