In the course of employment by defendant, X handled large amounts of cash. To facilitate this work, plaintiff gave X access to its banking house, enabling X to steal $5,000 in paper currency. X used the money to repay a shortage in his accounts with defendant, placing the money in the treasury of defendant as a credit to himself and obtaining a receipt from defendant's cashier. Defendant had no knowledge of the theft. Plaintiff sued for the money, claiming defendant was unjustly enriched by the acts of X and had no right to the money. Defendant contended that the pre-existing indebtedness constituted value and that it was a holder in due course with full title to the $5,000. Held: plaintiff is entitled to recovery; the defendant did not part with value. One judge dissented on the basis that the antecedent debt constituted value, enabling the transferee to become a holder in due course. Stone & Webster Engineering Corp. v. Hamilton Nat. Bank, (6th Cir. 1952) 199 F. (2d) 127.
David W. Belin,
BILLS AND NOTES-HOLDERS IN DUE COURSE-RECEIPT OF STOLEN INSTRUMENTS,
Mich. L. Rev.
Available at: https://repository.law.umich.edu/mlr/vol51/iss6/7