BILLS AND NOTES-HOLDERS IN DUE COURSE-GOOD FAITH TAKER

Authors

Abstract

The plaintiff bank sued the defendant maker on his promissory note which with several others had been given as collateral by the payees for a loan made to them by the bank. The defendant alleged fraud and that the bank did not take in good faith as required by the Uniform Negotiable Act, Gen. Laws 2921 (N. I. L., sec. 52) because of the following circumstances: inconsistent property valuation reports, knowledge of the slight financial responsibility of one of the makers of the note, insufficient investigation of financial status of one of the guarantors and the lack of a financial report on the guarantors before the loan was made. The lower court directed a verdict for the plaintiff. In affirming the decision it was held, that the evidence disclosed nothing that would lead a reasonable man to think that the note was taken otherwise than in good faith, and that the taking under circumstances arousing suspicion would be sufficient evidence to draw an inference of lack of good faith by the taker. Chase Nat. Bank v. Healy (Vt. 1931) 156 Atl. 396.

Recommended Citation

BILLS AND NOTES-HOLDERS IN DUE COURSE-GOOD FAITH TAKER, 30 Mich. L. Rev. 964 (1932).
Available at: https://repository.law.umich.edu/mlr/vol30/iss6/16