Summary

Portrait of Salmon P. Chase Salmon P. Chase Texas v. Hardenberg — Opinion of the Court

Will it be insisted for the complainant, that when Hardenberg purchased these bonds they were overdue, and that this circumstance defeats his title?
Suppose they were, in all respects, like a promissory note, indorsed after it was due? What would be the legal consequence? Such an instrument does not cease to be negotiable when it is past due and unpaid. It is now settled, [3] both in England and in this court, as we have seen, that circumstances which would have put a prudent man upon inquiry, are not enough to affect the title of a bon a fide holder for value.
Source: Wikisource

Portrait of Salmon P. Chase Salmon P. Chase Texas v. Hardenberg — Opinion of the Court

Equity looks through forms to substance; and the substance of this transaction clearly was the substitution of one set of securities in the hands of the Controller of the Treasury for another, for the benefit of the parties really entitled. In no other way could the object of the trust, namely, the security of the government and the secretary against loss, be attained. At the beginning, he held bonds or coupons of the United States issued as indemnity to Texas. At the end, he held registered bonds of the United States in their place.
Source: Wikisource

Portrait of Salmon P. Chase Salmon P. Chase Texas v. Hardenberg — Opinion of the Court

That transaction was correctly described as 'a payment in form,' the proceeds having been, in fact, withheld. It was not designed, on the part of the Secretary of the Treasury, to defeat the legal proceedings already commenced by filing the bill and issuing the subpoenas in the cause. We will not presume that any one else entertained such a design. Certainly no such effect, if designed, can be accomplished through the aid of a court of equity. We are obliged, therefore, to say that the delivery of the coin check to the agent of Hardenberg was not payment.
Source: Wikisource

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