Lytle v. Lansing

Citations

• 147 U.S. 59
• 13 S. Ct. 254
• 37 L. Ed. 78
• 1893 U.S. LEXIS 2143

Syllabus

<p>When negotiable bonds of a municipality, issued in aid of a railroad company, are void as between the railroad company and the municipality, the burden is upori the holder to show that he, or some one through whom he obtained title to them, was a bona fide purchaser for a valuable consideration.</p> <p>The settled rule in equity that-a purchaser without notice, to be entitled to ■ protection, must not only be so at the time of the contract or convey- . anee, but also át the time of the payment of the purchase money, applies to the purchase of negotiable municipal bonds.</p> <p>It is the duty of one who purchases municipal bonds, knowing that the municipality is contesting its liability on them, to make inquiries, and ' the failure to do so will be held to be a wilful closing of his ears to information.</p> <p>The several holdings of the bonds which form the subject of this litigation since they passed out of the railroad company examined, and held to be either as collateral for a debt which has been paid, or ¿s fictitious, for a real owner who is affected with notice of their invalidity.</p>