Bank of Paris v. Pearson

Wood, J., (after stating the facts.) It is settled by the rules of the law merchant, which obtain in this state, that when a bill or note is, by its terms, made payable to bearer, or to a designated person or bearer, it may be negotiated so as to pass the legal title by delivery without indorsement. Buckner v. Bank, 5 Ark. 536; Edison v. Frazier, 5 Ark 219. See, also, Evans v. Speer Hardware Co., 65 Ark. 204; 4 Am. & Eng. Enc. Law, p. 250 (2 Ed.), and authorities cited. Possession of the notes by Hiner was prima facie evidence of ownership in him, and, without notice to the contrary, appellant could buy them without inquiry. 1 Dan. Neg. Inst. § 812; Winship v. Merchants National Bank, 42 Ark. 22. No infirmity, appearing upon the face of the paper, the facts in reference to its transfer show appellant to have been an innocent holder in good faith for value. It follows that the decree of the court is erroneous in not being for the full amount of the notes, and the same is reversed, and the cause is remanded, with directions to enter a decree for 'the full amount of the notes, and for foreclosure of the mortgage for said sum, and'such other proceedings as may be necessary, not inconsistent with this opinion.