Ladd v. Read

Citations

• 114 Kan. 175
• 217 P. 273
• 1923 Kan. LEXIS 51

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>1. Negotiable Notes — Note Payable to Maker — When Maker is Entitled to Rights of an Innocent Holder. Whether or not the payee of a promissory-note may ever be properly described as a holder in due course, he may sustain such a relation to it as to be entitled to enforce it as one having the rights of an innocent purchaser, notwithstanding its execution had been procured by fraud.</p> <p>2. Same — Notes Procured by False Representations of Officers of Bank — Bank Not a Holder in Due Course. Where the president and vice president of a bank by false representations as to their financial resources induce an acquaintance to execute his note to the bank and deliver it to them in exchange for theirs to him, his account at the bank being given credit, which is transferred by his check to one of them, the bank is not entitled to enforce the note as an innocent purchaser, being chargeable with the knowledge these officers had of its fraudulent origin, particularly in view of the fact that the credit resulting from it was transferred to the accounts of insolvent debtors of the bank.</p>