Corporations. When a corporation has power, under any circumstances, to issue negotiable securities, a bona fide holder has a right to presume that they were properly issued, and they are no more liable to be impeached in his hands for any infirmity than any other commercial paper, p. 784.

In the Federal courts the following affirm and rely upon this holding: The Mayor v. Lord, 9 Wall. 414, 19 L. 707, holding that city improvement bonds could not be impeached in the hands of an innocent purchaser; Merchants' Bank v. State Bank, 10 Wall. 645, 19 L. 1018, holding that where a party deals with a corporation in good faith and the transaction is not ultra vires, the corporation is bound by the contract; Pendleton Co. v. Amy, 13 Wall. 305, 20 L. 580, holding that it is to be presumed that county officers act rightly, and a county may be estopped from asserting the conditions attached to a grant of power were not fulfilled; City of Lexington v. Butler, 14 Wall. 296, 20 L. 813, as the rule in a suit in city railroad-aid bonds; Commissioners v. January, 94 U. S. 206, 24 L. 112, holding that an error in recitals of the enabling act did not affect validity of bonds; San Antonio v. Mehaffy, 96 U. S. 314, 24 L. 817, holding that where the record did not show that the bondholder was other than a purchaser for value without notice, regularity was to be presumed; County of Macon v. Shores, 97 U. S. 279, 24 L. 890, holding the county estopped from denying the effect of the record of its County Court; Ex parte Estabrook, 2 Low. 549, F. C. 4,534, holding that a bona fide holder may presume regularity of promissory note by the treasurer or manager of a trading corporation; Milner's Admr. v. Pensacola, 2 Woods, 637, F. C. 9,619, holding that where a city was authorized to subscribe to any plank or railroad leading from the city, and the pleas showed the subscription was to such a road, an informality in the election would not invalidate the issue; Railroad Co. v. Otoe Co., 1 Dill. 342, F. C. 2,667, holding that if the authority to issue bonds did not exist, and the corporation was not liable, the fact may be pleaded in defense; Chilton v. Town of Gratton, 82 Fed. 878, holding that where the bonds contained recitals that they were issued according to statute, the purchaser had a right to presume due issue.

State court cases cite and rely upon the syllabus holding as follows: State v. City Council, 74 Ala. 231, holding the presumption is in favor of official propriety and a bona fide purchaser is not required to institute an inquiry whether officers have done their duty; Spence v. Mobile, etc., R. Co., 79 Ala. 589, holding that where bonds required the governor's indorsement, a purchaser in open market of indorsed bonds was justified in inferring compliance with all conditions precedent; Florence R. & I. Co. v. Chase National Bank, 106 Ala. 369, 17 So. 720, holding that corporations authorized to issue commercial paper are bound by the rules of commercial law, and cannot plead ultra vires to a note on its face against a bona fide

holder; Jefferson Co. v. Lewis, 20 Fla. 1007, 1009, holding that where the board was by statute made the proper county agent to decide on compliance with the precedent conditions, its official record was conclusive; Lewis v. Commissioners, 12 Kan. 209, holding that determination is evidence of authority otherwise given, and is conclusive in an action by a bona fide holder; Atchison, etc., R. Co. v. Fletcher, 35 Kan. 248, 10 Pac. 605, holding that where a statute conferred express authority on a company to guarantee bonds, a mere failure to pursue the mode specified in the statute will not invalidate the guarantee in the hands of a bona fide holder, collecting authorities; Greenwell v. Haydon, 78 Ky. 334, 39 Am. Rep. 235, holding that county railroad-aid bonds were commercial paper, and the rights of holders were regulated by the law merchant; Fogg v. Supreme Lodge, etc., 156 Mass. 434, 31 N. E. 290, holding that where an insurance company was prohibited by statute from employing paid agents to solicit business, but did so employ them, holders of certificates might refuse to pay further assessments without incurring forfeiture; Steines v. Franklin Co., 48 Mo. 183, 8 Am. Rep. 94, holding that a purchaser of bonds was charged with the duty of seeing that the power authorizing the issue of the bonds existed; Bremen Sav. Bank v. Branch-Crookes Saw. Co., 104 Mo. 437, 16 S. W. 212, holding that one who took a note bona fide in good faith, under belief of the maker's undertaking to pay, and delivered it up in exchange for a new note, with extended time for payment, was a bona fide holder for value and could recover, though, in fact, the note was issued without authority; National Bank v. Young, 41 N. J. Eq. 535, 7 Atl. 489, holding that the rule applied also to commercial paper made by a corporation for accommodation, when in the hands of a bona fide holder, taking it before maturity, on the faith of its being a business paper; Walker v. State (Bond-Debt Cases), 12 S. C. 274, holding that negotiable bonds issued by competent authority are, in the hands of bona fide holders, exempt from inquiry into the circumstances under which they were put into circulation; De Voss v. City of Richmond, 18 Gratt. 358, 98 Am. Dec. 660, holding that a bona fide purchaser of a city of Rich mond bond takes a legal title; Arents v. Commonwealth, 18 Gratt. 767, holding that State railway-aid bonds, payable to holder with the coupons, were negotiable instruments; Supervisors v. Randolph, 89 Va. 620, 16 S. E. 724, holding that a bona fide holder of coupons to county railway-ald bonds can compel, by mandamus, the levy of a tax to pay them.

Cited also in dissenting opinion in Smith v. Sac County, 11 Wall. 156. 20 L. 107, majority holding that when the municipality has shown fraud in the origin of the bonds, plaintiff must prove that he was an innocent holder for value; State v. Clinton, 28 La. Ann. 400, majority holding that guarantee bonds issued after passage of a prohibitory constitutional amendment were not binding. Cited

in general discussion in Hawkins v. Carroll Co., 50 Miss. 764, collecting and reviewing decisions. See notes to 98 Am. Dec. 688, 23 Am. Rep. 16, and 18 Am. Rep. 263.

Distinguished and limited in Hopper v. Covington, 118 U. S. 150, 30 L. 192, 6 S. Ct. 1026 (affirming S. C., 10 Biss. 492, 8 Fed. 781), holding that the presumption only applied to the requisite preliminary proceedings; City El. St. R. Co. v. First Nat. Bank, 62 Ark. 39, 54 Am. St. Rep. 285, 34 S. W. 90, 31 L. R. A. 537, holding that where the authority of corporate officers is challenged, it should be proved, not presumed as matter of law; Town of Lyons v. Chamberlain, 89 N. Y. 587, holding that rule did not apply when there was no authority.

Corporations.- A negotiable security of a corporation, apparently duly issued and conforming to charter, is valid in the hands of a bona fide holder without notice, although, in fact, not authorized by the charter, p. 784.

Cited and principle applied in Town of Coloma v. Eaves, 92 U. S. 491, 23 L. 581, holding that recitals in municipal bonds entitled purchaser to assume compliance with the conditions of issue; Hackett v. Ottawa, 99 U. S. 96, 25 L. 366, holding the city estopped by recitals from denying bonds were issued for municipal or corporate purposes; Phelps v. Lewiston, 15 Blatchf. 153, F. C. 11,076, holding recitals of issue pursuant to statute conclusive of the fact; Brewton v. Spira, 106 Ala. 236, 17 So. 608, holding recital of issue under municipal ordinance and statute estopped the municipality from pleading that purpose was unauthorized; Cutler v. Board, 56 Miss. 123, holding that recitals of compliance with the legislative authority estopped a showing that the reservation of interest semi-annually was in conflict with the statute authorizing annual interest; Coler v. Board, 6 N. Mex. 132, 27 Pac. 629, holding that by implication county and township officials had statutory power to adjudicate all the preliminary matters and to recite their determination on the bonds in terms creating an estoppel, reviewing authorities; Belo v. Commissioners, 76 N. C. 495, holding that recitals were conclusive and constituted an estoppel in pais in an action by a bona fide purchaser for value; Walker v. State (Bond-Debt Cases), 12 S. C. 275, holding that when a statute authorizes an issue upon conditions, a recital of issue under the authority of the statute is conclusive of compliance with conditions. Cited in dissenting opinion in Smith v. Sac Co., 11 Wall. 163, 20 L. 110, majority holding that when fraud in the origin of the bonds was shown it was incumbent on plaintiff to prove that he was an innocent holder for value. See note to 64 Am. Dec. 430.

Distinguished in Morris v. Griffith, etc., Co., 69 Fed. 138, as inapplicable where there was no showing that the corporation officers had authority to make and issue its promissory notes; Lewis v.

Commissioners, 12 Kan. 219, holding that there being no recitals and records showing non-compliance with the statute, the county plead no authority.

Miscellaneous.- Note to 12 Blatchf. 60, F. C. 3,178, on liability of municipalities on negotiable paper.

5 Wall. 785-791, 18 L. 562, KELLY v. CRAWFORD.

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Trial. An agreement, the validity of which is contested, may be admitted in evidence, subject to the proof to be given hereafter," p. 790.

Cited in First Unitarian Soc. v. Faulkner, 91 U. S. 418, 23 L. 284, holding that the order and times of introducing evidence belong to the Circuit Courts, with which the Supreme Court ought not to interfere.

Arbitration and award.- An agreement that accountant's certificate should be final as to amount due is not a submission to arbitration, nor is accountant's report an award of an arbitrator, p. 790.

Cited and principle applied in Willingham v. Veal, 74 Ga. 759, holding an agreement that if contracting parties could not agree on market value, it should be ascertained by parties to be ap pointed by the contractors, was not agreement for an arbitration; Green Street, etc., R. Co. v. Moore, 64 Pa. St. 91, holding that where a railway company accepted a charter on condition of their purchasing the stock of a horse-car line, at a price to be fixed by appraisers, was not a submission to arbitration. Cited in dissenting opinion in Norton v. Gale, 95 Ill. 547, note to 35 Am. Rep. 180, majority holding a proviso in lease that rent be based on appraised value of premises not a submission to arbitration.

Partnership. After dissolution, a partner may ratify the act of a former partner in signing firm name, and such ratification binds firm, p. 790.

Cited and principle applied in Williston v. Camp, 9 Mont. 97, 22 Pac. 503, holding that signature of a note by one of the firm in the presence of all, and receipt of the benefit of the proceeds, was both delegation and ratification.

5 Wall. 791-795, 18 L. 606, O'NEAL v. KIRKPATRICK.

Public lands.- Sale of tide or marsh lands within five miles of San Francisco held unauthorized under California statutes of May 13 and 14, 1861, pp. 793-795

Not cited.

5 Wall. 795-808, 18 L. 653, DEERY v. CRAY.

Deeds. Recitals in ancient conveyance, of facts on which its power depends, when not inconsistent with any fact found, may be

proved as against persons who are not parties to deed, and who claim no right under it, p. 805.

Cited and principle applied in Fulkerson v. Holmes, 117 U. S. 399, 29 L. 919, 6 S. Ct. 785, admitting a declaration of sole heirship in a writing sixty-one years old as proper evidence tending to prove such fact; Jackson v. Deslonde, 1 Posey, 685, holding that recitals in a deed forty years old were evidence, coupled with testimony of possession; Harman v. Stearns, 95 Va. 63, 27 S. E. 603, holding that a recital of grantor's widowhood in a deed forty-six years old necessarily implied the prior death of her husband.

Estoppel.- No one can rely on estoppel growing out of a transaction to which he was not a party or a privy, and which in no manner touches his rights; mutuality is a requisite of all estoppels, p. 803.

Cited and principle relied on in Thompson v. Sioux Falls Nat. Bank, 150 U. S. 244, 37 L. 1067, 14 S. Ct. 99, doubting if a transferee of a cashier's check, given without consideration, could plead maker was estopped from denying liability; Fitch v. Cornell, 1 Sawy. 171, F. C. 4,834, holding that a judgment in another case cannot estop the plaintiff in a subsequent action, unless it also binds the defendants in the subsequent action; Stanton v. Alabama, etc., R. Co., 31 Fed. 588, holding that a contract by a purchaser, appointed receiver, to pay invalid certificates, issued by a prior receiver, was not estopped from pleading ultra vires; Houston v. Blythe, 60 Tex. 512, holding that recitals in a private instrument, executed between the original grantee and a stranger to the plaintiffs in error, could not aid or prejudice their rights; Rives v. Farish's Admr., 24 Gratt. 134, holding that when an estoppel is relied on to conclude a party from claiming a clear legal right, he who claims the benefit ought himself to be bound by it.

Acknowledgment.- A recital in a married woman's certificate of acknowledgment, of examination "privately, apart from and out of the hearing of " her husband, shows conclusively that the examination was had out of his presence, as required by statute, p. 807. Cited and principle applied in Nippel v. Hammond, 4 Colo. 216, holding "contents and meaning of the deed were made known and fully explained," to comply with requirement that "the effect of the deed" should be explained; Hart v. Sanderson's Admrs., 18 Fla. 112, where the certificate to a mortgage, with a covenant of warranty, stated that it was executed to convey "all her estate in esse and in futuro,” held sufficient to bar dower; Johnson v. Badger M. & M. Co., 13 Nev. 353, sustaining sufficiency of a certificate of acknowledgment of a mortgage by the president and secretary of a corporation on the question of identification; Hockman v. McClanahan, 87 Va. 37, 12 S. E. 231, holding that the substantial compliance must extend to every requisite of the statute; Virginia Coal,