National City Bank of NY v. Hotchkiss
Supreme Court of the United States
APPEALS PROM THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT. The facts, which involve the determination of whether the delivery of securities by a broker, immediately preceding his bankruptcy, to a bank to secure its loan was an illegal preference, are stated in the opinion. The law presumes an agreement or transaction to be legal, when it is capable of a construction which makes it valid.
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APPEALS PROM THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT. The facts, which involve the determination of whether the delivery of securities by a broker, immediately preceding his bankruptcy, to a bank to secure its loan was an illegal preference, are stated in the opinion. The law presumes an agreement or transaction to be legal, when it is capable of a construction which makes it valid. Jones on Evidence (2d ed.), § 85; King v. Hawkins, 10 East, 211; Curtis v. Gokey, 68 N. Y. 300, 304; Ormes v. Dauchy, 82 N. Y. 443. So as to securing a just debt. Getts v. Janesville Co., 163 Fed Rep.…
1Opinion of the CourtJustice Holmes
This is a suit by a trustee in bankruptcy to recover certain securities alleged to have been transferred to the defendant bank by way of preference. The plaintiff had a judgment in the District Court, 200 Fed. Rep. 287, id. 299, and in the Circuit Court of Appeals, 201 Fed. Rep. 664; 120 C. C. A. 92. Both parties appeal; the plaintiff upon a subordinate question as to its right to elect damages instead of a return of the securities.
The case arose upon what is known in New York as a clearance loan. Brokers need large sums to clear or pay for the stocks that they receive in the course of 'the…
2Cases cited6 opinions
- Richardson v. ShawSupreme Court of the United States · 1908
- Sexton v. Kessler & Co.Supreme Court of the United States · 1912
- Hurley v. Atchison, Topeka & Santa Fe Railway Co.Supreme Court of the United States · 1909
- Ernst v. Mechanics' & Metals Nat. Bank of New YorkCourt of Appeals for the Second Circuit · 1912
- Gorman v. LittlefieldSupreme Court of the United States · 1913
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3Cited by197 opinions
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- Mencher v. WeissNew York Court of Appeals · 1953
- Barnes v. AlexanderSupreme Court of the United States · 1914
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