by John Marshall Harlan

“ That rule does not, however, restrict the power of the court to give to the jury a peremptory instruction covering such an issue, when the evidence is all on one side, or so overwhelmingly on one side as to leave no room to doubt what the fact is. In this case there is an entire absence of any evidence impeaching the good faith of Bates, Reed & Cooley in procuring the mortgage of February 7, 1881. There is nothing whatever to show that they had any purpose to commit a fraud, or to put their mortgagors in such a position that the latter could more readily deceive or defraud other creditors. ”

“ In either case, the bona fide holder is unaffected by equities or defenses between prior parties of which he had no notice.'
Do these principles apply to the case of a chattel mortgage given merely as security for a pre-existing debt, and in obtaining which the mortgagee has neither parted with any right or thing of substance, nor come under a binding agreement to postpone or delay the collection of his demand? Upon principle, and according to the weight of authority, this question must be answered in the negative. ”

“ The rules established, in the interests of commerce, to facilitate the negotiation of mercantile paper, which, for all practical purposes, passes by delivery as money, and is the representative of money, ought not, in reason, to embrace instruments conveying or transferring real or personal property as security for the payment of money. ”

“ Lynn, 34 Mich. 360, the court, after observing that the object of the statute is to protect those who have acquired rights under the circumstances which would render them liable to be defrauded unless protected against instruments of which they knew nothing when acquiring their rights, said: 'It has always been held that a purchaser who had paid nothing could not be thus defrauded, and that no one could be protected as a bona fide purchaser, except to the extent of his payments made before he received such notice as should have prevented him from making further payments. ”

“ He can only do that by means of some process or proceeding against the property. Section 4706.' In that case the court cites Thompson v. Van Vechten, 27 N. Y. 568, 582, in which it was held, in reference to a somewhat similar statute, that 'the mortgage cannot be legally questioned until the creditor clothes himself with a judgment and execution, or with some legal process, against his property; for creditors cannot interfere with the property of their debtor without process.'
But it is argued that this rule does not apply in the case of a creditor who is a second mortgagee in possession. ”

“ People v. Bristol, 35 Mich. 28, 32; Wingler v. Sibley, Id. 231; Robinson v. Elliott, 22 Wall. 523. The good faith of such transactions, where they are not void upon their face, is, under the statutes of Michigan, a question of fact for the determination of the jury. ”