Page:Federal Reporter, 1st Series, Volume 4.djvu/41

 BANK OF SHETlMAN V. APPER80K. 27 T)y the offieers. But, more than this, the defence is that the consideration of this note bas failed by reason of a failure of title and diminution in quantity of the land, and that by the «ontract of purchase the money was not to be paid until the title was satisfactory. There is not a single circumstance or fact in the proof which even tends to show that the plaintiflE liad any knowledge that there were such defences to the note, or of the f acts upon which they were predicated. It does not foUow because the plaintiff knew the note was given for land ihat it knew the facts as to the title or quantity. The whole argument of defendants is grounded upon the assumption that because the face of the note itselt conveyed a knowledge that there was a contract for land, that the land lay in arkansas, that the payee was an administrator, and because he was pledging a note of $1,500 for a loan of $500 at an enormous interest of 4 per cent, a month, therefore, in the language of the brief, "the bank had notice or knowledge that there was a probable defence to the note." Now, if the decisions of the supreme court already cited, and many others, mean anything, they forbid, in this court, that any circumstance short of actual knowledge of the facts constituting the defence shall be taken to def eat the holder of his right to recover. The proof showed that in Texas, where this bank resides, the rate of interest was lawful and not unusual, and therefore no imputation of bad faith can be based upon that circumstance. As to the fact that the ne- gotiator of the loan was an administrator, it is wholly imma- terial. He may have needed the money for the purposes of the estate. The note may have belonged to him, having been taken in settlement for his commissions, or for a debt, or for a distributive share of the estate, for anything the bank knew to the contrary. He was the payee ; the legal title was in him, and the bank need not, under the commercial law of the United States, trouble itself to inquire into the facts. Any man may pledge a large collateral for a small loan, and they are of ten out of ail proportion to eaoh other. . I could see in the proof notbing tending to show that the bank had actual notice of the fact that the title to the land had failed, or the quantity was diminished, or the quality insuffi-