Morrison Waite

“ Colville, after consultation with the directors, agreed to let him have the money, and he thereupon procured the execution by his wife of the mortgage now in suit, and another on a house and lot she owned in Cincinnati to secure another note of his for $7,000, payable to the order of Colville in three years from date, with interest at the rate of 8 per cent. per annum, payable semi-annually. He then took the two notes and mortgages to the bank, and placed them as collateral security for his own note for $12,000 at 60 days, which was discounted and placed to his credit in account. ”

“ As between the old bank and the new, we entertain no doubt that the new bank is to be treated in all respects as the successor of the old, taking the assets that were turned over as they stood, and assuming the liabilities. ”

“ They had actually discounted the note, and placed the proceeds to the credit of the bank in their general account, and it does not appear that this credit had ever been canceled when the suit was brought. But it is equally apparent that they are not, either in law or equity, entitled to protection as innocent holders for value against the defenses of Nash and wife to the note and mortgage in the hand of Colville or the bank. ”