Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/317

 PART III.] ACTS BEYOND THE CORPORATE POWERS. [§ 327. own name. 1 Likewise, the interest coupons attached B, , to municipal bonds payable to bearer are themselves coupons negotiable and transferable by delivery when sepa- rated from the bonds.- An overdue and unpaid interest coupon, attached to a bond which has several years to run, does not render the bond and the subsequently maturing coupons dis- honored paper, so as to subject them in the hands of a pur- chaser for value to defences good against the original holder. 8 § 327. The rule that all persons are affected with notice of a suit pending in regard to the title to property, and H ld that every one buys the same at his peril from any of affected the litigating parties, does not apply to municipal ot lis pen- bonds and other commercial securities, purchased ens ' before maturity. 4 But a person who buys overdue municipal some infirmity passes to the hands of a holder for value without notice, so that he could collect, all his rights pass to a subsequent purchaser with notice. Scotland County v. Hill, 132 U. S. 107. 1 Ottawa y. National Bank, 105 U. S. 342. 2 City of Lexington v. Butler, 14 Wall. 282 ; Grande Chute v. Winegar, 15 Wall. 355; Clark v. Iowa City, 20 Wail. 583 ; Walnut v. Wade, 103 U. S. 023 ; Ohio v. Frank, ib. 697. 3 Cromwell v. County of Sac, 96 U. S. 51. And overdue interest coupons detached from a bond not yet ma- tured are negotiable. Thompson v. Perrine, 106 U. S. 589. Quazre, as to the scope of the decision in this last case ; for the statute of limitations runs against coupons from the time they are due, whether they are de- tached from their bonds or not. Amy v. Dubuque, 98 II. S. 470 ; Koshkonong ». Burton, 104 U. S. 668. In a suit on municip.nl bonds, the holder of the bonds and the unpaid coupons is entitled to interest on un- paid interest from the time it fell due. Rich v. Town of Seneca Falls, 19 Blatchf. 558 ; cf. Bailey v. County of Buchanan, 115 N. Y. 297; although there has been no demand for pay- ment, McLendon v. Commissioners, 71 N. C. 38 ; but there must have been default on the part of county, either in the payment of the prin- cipal debt or the coupons. See Au- rora City v. West, 7 Wall. 82; Gelpcke v. Dubuque, 1 Wall. 175. Overdue interest coupons bear interest at the legal rate of the place where they are payable. Scotland County v. Hill, 132 U. S. 107. The right to interest on interest, whether arising on an express or on an implied agreement, if allowed by statutes in force when the bonds were issued, cannot be im- paired by subsequent legislation de- claring the true intent and meaning of those statutes. Koshkonong v. Burton, 104 U. S. 668. 4 Couuty of Warren v. Marcy, 97 U. S. 96; County of Cass v. Gillett, 100 U. S. 585; Carroll County w. Smith, 111 U. S. 556; Enfield v. Jor- dan, 119 U. S. 680. See, also. County of Macon v. Shores, 97 U. S. 272; Leitch v. Wells, 48 N. Y. 585; Stone 297