Zimpleman v. Veeder

Citations

• 98 Ill. 613
• 1881 Ill. LEXIS 300

Syllabus

<p>1. Pledge—pledgee can not sell note pledged, without authority. The pledgee of commercial paper, in the absence of any power of sale by contraer, can not sell such paper, but it is his duty to collect the same, and apply enough of the proceeds to pay his debt, and return the balance to the pledger.</p> <p>2. Same—sale of under power, passes title from pledger. If the pledgee of a promissory note, under a power of sale conferred on him, makes a bona fide sale to one capable of buying, the sale will pass the title to the note beyond the pledger’s reach, although it is sold for less than there is due upon the same.</p> <p>3. Same—sale by pledgee, whether bona fide. Where the maker of a note pledged for a debt by the payee, negotiates with the pledgee for its purchase' at the amount due the latter, which is much less than the face of the note, and the maker is informed of the time of the sale, while the pledger is not, and the maker becomes the purchaser at a formal public sale, and receives the note, this will not be regarded such a sale as the law requires, but rather as a compromise between the pledgee and the maker of the note.</p> <p>4. Same—pledgee can not compromise with maker of note pledged. The pledgee of a note has the right to collect the same of the maker, but not to compromise with him, and take less than is due on the note. There may be cases, where the debt is not well secured, that the pledgee may take less than is due, and surrender the note, but he can not do this where the debt is well secured.</p> <p>5. Purchaser—when maker of note may purchase same. The maker of a note for $1930, secured by mortgage on real estate, who, on selling the mortgaged premises, covenants with the purchaser to pay such note, can not become a purchaser of the same for $1120 at a pledgee's sale, under a previous arrangement with the pledgee to buy it, and thus acquire a title to the note, but on a foreclosure of the mortgage the sum paid by him for the note will be deduct