Bank of Newton v. Simmons

Mates, J., delivered tbe opinion of'tbe court. It is manifest that a fraud was perpetrated on Simmons by Latbrop & Oo., when they sold him tbe exclusive right to sell safety sash locks in Hinds county, and that be obtained nothing for bis money or for tbe execution of tbe notes; and, if tbe litigation was between Simmons and Latbrop & Co., there would be no trouble in bis defeating the payment of tbe notes. But tbe appellees were so tmfortunate as to execute to Latbrop & Co. their promissory note payable to bearer, and there is no doubt that tbe note is now owned by tbe Bank of Newton, and that the note was bought by the Bank of Newton without any notice of any defense held against it by tbe maker thereof, and bought in good faith, for value, before maturity, and in tbe usual course of business. Tbis being tbe case, there is no defense to tbe note in tbe bands of tbe Bank of Newton, an innocent bolder thereof, except that of payment. This is but tbe application of tbe familiar rule of law that, where one or two innocent parties must suffer loss, tbe loss must fall on the one whose act made it possible for tbe other to be defrauded. In tbis view of tbe case, we deem it unnecessary to discuss tbe instructions granted for tbe defendant. All of tbe instructions for defendant were wrong, not as abstract principles of law, but because there was no fact on which to base them. Reversed and remanded.