Page:Federal Reporter, 1st Series, Volume 1.djvu/714

 receipts are valid in the hands of the bank for such money loaned. Given.

3. That if the defendant gave the warehouse receipts set out in the petition to said Grant for lard left by him in defendant’s warehouse, and after the same were bona fide pledged by said Grant to the plaintiff, as above set out, for loans of money or the continuance of such loans made upon receipts, delivered the lard back to said Grant without the warehouse receipts, and without the knowledge or consent of the plaintiff, then the plaintiff would be entitled to recover of the defendant the value of the lard named in such warehouse receipts as aforesaid, provided the indebtedness of said Grant to the plaintiff, for which such pledge was made, was equal to such value. Given.

4. If the plaintiff and defendant have both suffered by the fraud of James B. Grant, by the defendant leaving the warehouse receipts in question outstanding, and the delivery to him of the lard without the said warehouse receipts, and by the use of said receipts by said Grant, in the ordinary course of business, as a means of credit with the plaintiff, then the defendant must bear the loss. Given.

5. If the defendant, Bates, adopted a mode of doing business with Grant by which he gave him warehouse receipts like these in question, and delivered the property without inquiry for or having the receipts returned to him, and did so in this case while the bank held them as collateral for loans made and now due, such a course of business could not be set up as a defence to this action, if the bank had no knowledge of it, or that the property was delivered up to Grant, or would be, and did not assent to it in any way. Given.

6. Even should it be shown in this case that the proceeds of the lard in question was deposited in the bank by Grant in his bank account, upon which he was daily drawing, that such fact would be no defence to this action unless the bank had notice or knew that the money so deposited was the proceeds of the lard, or that Grant had received the lard from Mr. Bates. Given.