Page:Federal Reporter, 1st Series, Volume 2.djvu/14

 OHBW V, HENBIETTA MININO & SMELTING 00. 7 �point, so far as Chew is concerned, is found in his testimony, quoted by the maeter, as follows : �" Interrogatory 4. Did said Dever state for whose account he applied for loans on said bonds ? Answer. Tes. He said the bonds were owned by William Muir, or held by Wil- liam Muir ; that said Muir was the agent of the Henrietta Mining & Smelting Company, at New York; that $100,000 of said bonds had been prepared for issuance by said Com- pany, the proceeds of sale of which were applied to the pur- chase of maohinery to work the mine, which he said was loca- ted near Potosi, in the state of Missouri ; he said further that Wmiam Muir was pressed for funds, and had requested him to make loans for him (Muir) on the said bonds." �I agree with the conclusion of the master that upon that state- ment Mr. Chew was fuUy informed, not only as to the nature and estent of Muir's authority, but of the faet that he was vioiating it in so placing the bonds for the purpose of raising money for his own purposes, and not for the corporation; and, on that ground, the exception to the report, so far as that part of it is concerned, is overruled. �As to the other part of the case, — the title of the defendant Burch to the bonds represented by him, — I have had more difficulty. But in this case, as in the other, it is simply a question of notice ; and I believe the rulings of the supreme court go so far as to hold that there must be something amounting to bad faith on the part of the purchaser before his title to negotiable pàper of this kind, purchased in the open market, can be defeated. An important f act in the case, as bearing upon the question of good faith, is this: Mrs. Burch advanced money — the title of the present defendant being derived f rom Mrs. Burch, of course the question is as to her title — to the secretary of the company, and to her hus- band, for the purpose of.paying a debt for which the corpora- tion was liable in equity. The debt was created for the pur- chase of this very real estate which is now in controversy. It was taken in the name of Edgerton, the secretary of the Company, and Burch, as a mere matter of convenienee, I apprehend, and they advanced on the payment of the pur- ����