prudent man inquiry in California

1974The holder of a negotiable instrument will be charged with a defect in that instrument when the circumstances are such as to justify the conclusion that the failure “to make inquiry arose from a suspicion that inquiry would disclose a vice or defect in the instrument . . . .” (Christian v. California Bank, supra, 30 Cal.2d 421, 425 ; Anderson v. Lee, 103 Cal.App.2d 24, 27 [ 228 P.2d 613 ].) “ ‘[M]ere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the p

1974The holder of a negotiable instrument will be charged with a defect in that instrument when the circumstances are such as to justify the conclusion that the failure “to make inquiry arose from a suspicion that inquiry would disclose a vice or defect in the instrument . . . .” (Christian v. California Bank, supra, 30 Cal.2d 421, 425 ; Anderson v. Lee, 103 Cal.App.2d 24, 27 [ 228 P.2d 613 ].) “ ‘[M]ere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the p

1960(Hobart v. Hobart Estate Co., 26 Cal.2d 412, 440 [ 159 P.2d 958 ]; Bowman v. McPheeters, 77 Cal.App.2d 795, 798, 802-803 [ 176 P.2d 745 ]; Blackman v. Howes, 82 Cal.App.2d 275, 278-279 [ 185 P.2d 1019 , 174 A.L.R. 1004 ].) ” (See also Bell v. Bayly Bros., 53 Cal.App.2d 149, 157 [ 127 P.2d 662 ].) We turn now to the validity of the various transactions even though actual fraud did not exist with respect thereto.

1960(Hobart v. Hobart Estate Co., 26 Cal.2d 412, 440 [ 159 P.2d 958 ]; Bowman v. McPheeters, 77 Cal.App.2d 795, 798, 802-803 [ 176 P.2d 745 ]; Blackman v. Howes, 82 Cal.App.2d 275, 278-279 [ 185 P.2d 1019 , 174 A.L.R. 1004 ].) ” (See also Bell v. Bayly Bros., 53 Cal.App.2d 149, 157 [ 127 P.2d 662 ].) We turn now to the validity of the various transactions even though actual fraud did not exist with respect thereto.

1960(Hobart v. Hobart Estate Co., 26 Cal.2d 412, 440 [ 159 P.2d 958 ]; Bowman v. McPheeters, 77 Cal.App.2d 795, 798, 802-803 [ 176 P.2d 745 ]; Blackman v. Howes, 82 Cal.App.2d 275, 278-279 [ 185 P.2d 1019 , 174 A.L.R. 1004 ].) ” (See also Bell v. Bayly Bros., 53 Cal.App.2d 149, 157 [ 127 P.2d 662 ].) We turn now to the validity of the various transactions even though actual fraud did not exist with respect thereto.

1960(Hobart v. Hobart Estate Co., 26 Cal.2d 412, 440 [ 159 P.2d 958 ]; Bowman v. McPheeters, 77 Cal.App.2d 795, 798, 802-803 [ 176 P.2d 745 ]; Blackman v. Howes, 82 Cal.App.2d 275, 278-279 [ 185 P.2d 1019 , 174 A.L.R. 1004 ].) ” (See also Bell v. Bayly Bros., 53 Cal.App.2d 149, 157 [ 127 P.2d 662 ].) We turn now to the validity of the various transactions even though actual fraud did not exist with respect thereto.

1960(Hobart v. Hobart Estate Co., 26 Cal.2d 412, 440 [ 159 P.2d 958 ]; Bowman v. McPheeters, 77 Cal.App.2d 795, 798, 802-803 [ 176 P.2d 745 ]; Blackman v. Howes, 82 Cal.App.2d 275, 278-279 [ 185 P.2d 1019 , 174 A.L.R. 1004 ].) ” (See also Bell v. Bayly Bros., 53 Cal.App.2d 149, 157 [ 127 P.2d 662 ].) We turn now to the validity of the various transactions even though actual fraud did not exist with respect thereto.

1960(Hobart v. Hobart Estate Co., 26 Cal.2d 412, 440 [ 159 P.2d 958 ]; Bowman v. McPheeters, 77 Cal.App.2d 795, 798, 802-803 [ 176 P.2d 745 ]; Blackman v. Howes, 82 Cal.App.2d 275, 278-279 [ 185 P.2d 1019 , 174 A.L.R. 1004 ].) ” (See also Bell v. Bayly Bros., 53 Cal.App.2d 149, 157 [ 127 P.2d 662 ].) We turn now to the validity of the various transactions even though actual fraud did not exist with respect thereto.

1964In Sears, Roebuck & Co. v. Blade, 139 Cal.App.2d 580 , it was said at page 590 [ 294 P.2d 140 ], quoting from Tognazzini v. Tognazzini, 125 Cal.App.2d 679 , at page 687 [ 271 P.2d 77 ]: “ ‘When the facts are susceptible to opposing inferences, whether a party had notice of circumstances sufficient to put a prudent man on inquiry as to a particular fact, and whether by prosecuting such inquiry he might have learned such fact, are questions of fact to be determined by the trial court. ’ ’ ’ In Grace v. Parker (Tex.Civ.App.), 337 S.W.2d 518 , where the owner sued the building contractor, defense

1964In Sears, Roebuck & Co. v. Blade, 139 Cal.App.2d 580 , it was said at page 590 [ 294 P.2d 140 ], quoting from Tognazzini v. Tognazzini, 125 Cal.App.2d 679 , at page 687 [ 271 P.2d 77 ]: “ ‘When the facts are susceptible to opposing inferences, whether a party had notice of circumstances sufficient to put a prudent man on inquiry as to a particular fact, and whether by prosecuting such inquiry he might have learned such fact, are questions of fact to be determined by the trial court. ’ ’ ’ In Grace v. Parker (Tex.Civ.App.), 337 S.W.2d 518 , where the owner sued the building contractor, defense

1977(E.g., Estate of De Laveaga (1958) 50 Cal.2d 480, 487 [ 326 P.2d 129 ].) Bogert states that where a statutory list still exists, the margin required is usually either 50 or 40 percent “and it is believed that under the prudent man rule a similar standard will be applied, unless there are special circumstances, as where the mortgage is insured.” (Bogert, supra, at pp. 268-269.) The Restatement notes that generally a trustee cannot “properly lend on a mortgage upon real property more than from one-half to two-thirds of the value of the mortgaged property.” (Rest.2d Trusts, § 229, com. a, p. 544.

1977(E.g., Estate of De Laveaga (1958) 50 Cal.2d 480, 487 [ 326 P.2d 129 ].) Bogert states that where a statutory list still exists, the margin required is usually either 50 or 40 percent “and it is believed that under the prudent man rule a similar standard will be applied, unless there are special circumstances, as where the mortgage is insured.” (Bogert, supra, at pp. 268-269.) The Restatement notes that generally a trustee cannot “properly lend on a mortgage upon real property more than from one-half to two-thirds of the value of the mortgaged property.” (Rest.2d Trusts, § 229, com. a, p. 544.

1974The holder of a negotiable instrument will be charged with a defect in that instrument when the circumstances are such as to justify the conclusion that the failure “to make inquiry arose from a suspicion that inquiry would disclose a vice or defect in the instrument . . . .” (Christian v. California Bank, supra, 30 Cal.2d 421, 425 ; Anderson v. Lee, 103 Cal.App.2d 24, 27 [ 228 P.2d 613 ].) “ ‘[M]ere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the p

1950(T)his rule is subject to the qualification that ‘where the circumstances are such as to justify the conclusion that the failure to make inquiry arose from a suspicion that inquiry would disclose a vice or defect in the instrument or transaction, such indorsee is charged with knowledge. ’ ” (Christian v. California Bank, 30 Cal.2d 421, 425 [ 182 P.2d 554 ].) It cannot be held as a matter of law that Pollack should have pursued the inquiry further than he did.

1947In construing this provision, this court has followed the general rule "that mere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the position of a holder in due course, unless the circumstances or suspicions are so cogent and obvious that to remain passive would amount to bad faith." (Popp v. Exchange Bank, 189 Cal. 296, 303 [ 208 P. 113 ]; Goodale v. Thorn, 199 Cal. 307, 314 [ 249 P. 11 ]; Merced Security Sav.

1947In construing this provision, this court has followed the general rule "that mere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the position of a holder in due course, unless the circumstances or suspicions are so cogent and obvious that to remain passive would amount to bad faith." (Popp v. Exchange Bank, 189 Cal. 296, 303 [ 208 P. 113 ]; Goodale v. Thorn, 199 Cal. 307, 314 [ 249 P. 11 ]; Merced Security Sav.

1974The holder of a negotiable instrument will be charged with a defect in that instrument when the circumstances are such as to justify the conclusion that the failure “to make inquiry arose from a suspicion that inquiry would disclose a vice or defect in the instrument . . . .” (Christian v. California Bank, supra, 30 Cal.2d 421, 425 ; Anderson v. Lee, 103 Cal.App.2d 24, 27 [ 228 P.2d 613 ].) “ ‘[M]ere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the p

1974The holder of a negotiable instrument will be charged with a defect in that instrument when the circumstances are such as to justify the conclusion that the failure “to make inquiry arose from a suspicion that inquiry would disclose a vice or defect in the instrument . . . .” (Christian v. California Bank, supra, 30 Cal.2d 421, 425 ; Anderson v. Lee, 103 Cal.App.2d 24, 27 [ 228 P.2d 613 ].) “ ‘[M]ere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the p

1964In Vai v. Bank of America, 56 Cal.2d 329, 343 [ 15 Cal.Rptr. 71 , 364 P.2d 247 ], the court said: “... ‘discovery is different from knowledge, [so] that where a party defrauded has received information of facts which should put him upon inquiry, and the inquiry if made would disclose the fraud, he will be charged with a discovery as of the time the inquiry would have given him knowledge. ’ (Victor Oil Co. v. Drum, 184 Cal. 226, 240 [ 193 P. 243 ].) ‘The circumstances must be such that the inquiry becomes a duty, and the failure to make it a negligent omission. ’ (Tarke v. Bingham, 123 Cal. 163

1964In Vai v. Bank of America, 56 Cal.2d 329, 343 [ 15 Cal.Rptr. 71 , 364 P.2d 247 ], the court said: “... ‘discovery is different from knowledge, [so] that where a party defrauded has received information of facts which should put him upon inquiry, and the inquiry if made would disclose the fraud, he will be charged with a discovery as of the time the inquiry would have given him knowledge. ’ (Victor Oil Co. v. Drum, 184 Cal. 226, 240 [ 193 P. 243 ].) ‘The circumstances must be such that the inquiry becomes a duty, and the failure to make it a negligent omission. ’ (Tarke v. Bingham, 123 Cal. 163

1964In Vai v. Bank of America, 56 Cal.2d 329, 343 [ 15 Cal.Rptr. 71 , 364 P.2d 247 ], the court said: “... ‘discovery is different from knowledge, [so] that where a party defrauded has received information of facts which should put him upon inquiry, and the inquiry if made would disclose the fraud, he will be charged with a discovery as of the time the inquiry would have given him knowledge. ’ (Victor Oil Co. v. Drum, 184 Cal. 226, 240 [ 193 P. 243 ].) ‘The circumstances must be such that the inquiry becomes a duty, and the failure to make it a negligent omission. ’ (Tarke v. Bingham, 123 Cal. 163

1964In Vai v. Bank of America, 56 Cal.2d 329, 343 [ 15 Cal.Rptr. 71 , 364 P.2d 247 ], the court said: “... ‘discovery is different from knowledge, [so] that where a party defrauded has received information of facts which should put him upon inquiry, and the inquiry if made would disclose the fraud, he will be charged with a discovery as of the time the inquiry would have given him knowledge. ’ (Victor Oil Co. v. Drum, 184 Cal. 226, 240 [ 193 P. 243 ].) ‘The circumstances must be such that the inquiry becomes a duty, and the failure to make it a negligent omission. ’ (Tarke v. Bingham, 123 Cal. 163

1964In Vai v. Bank of America, 56 Cal.2d 329, 343 [ 15 Cal.Rptr. 71 , 364 P.2d 247 ], the court said: “... ‘discovery is different from knowledge, [so] that where a party defrauded has received information of facts which should put him upon inquiry, and the inquiry if made would disclose the fraud, he will be charged with a discovery as of the time the inquiry would have given him knowledge. ’ (Victor Oil Co. v. Drum, 184 Cal. 226, 240 [ 193 P. 243 ].) ‘The circumstances must be such that the inquiry becomes a duty, and the failure to make it a negligent omission. ’ (Tarke v. Bingham, 123 Cal. 163

1964In Vai v. Bank of America, 56 Cal.2d 329, 343 [ 15 Cal.Rptr. 71 , 364 P.2d 247 ], the court said: “... ‘discovery is different from knowledge, [so] that where a party defrauded has received information of facts which should put him upon inquiry, and the inquiry if made would disclose the fraud, he will be charged with a discovery as of the time the inquiry would have given him knowledge. ’ (Victor Oil Co. v. Drum, 184 Cal. 226, 240 [ 193 P. 243 ].) ‘The circumstances must be such that the inquiry becomes a duty, and the failure to make it a negligent omission. ’ (Tarke v. Bingham, 123 Cal. 163

1964In Vai v. Bank of America, 56 Cal.2d 329, 343 [ 15 Cal.Rptr. 71 , 364 P.2d 247 ], the court said: “... ‘discovery is different from knowledge, [so] that where a party defrauded has received information of facts which should put him upon inquiry, and the inquiry if made would disclose the fraud, he will be charged with a discovery as of the time the inquiry would have given him knowledge. ’ (Victor Oil Co. v. Drum, 184 Cal. 226, 240 [ 193 P. 243 ].) ‘The circumstances must be such that the inquiry becomes a duty, and the failure to make it a negligent omission. ’ (Tarke v. Bingham, 123 Cal. 163

1960(Hobart v. Hobart Estate Co., 26 Cal.2d 412, 440 [ 159 P.2d 958 ]; Bowman v. McPheeters, 77 Cal.App.2d 795, 798, 802-803 [ 176 P.2d 745 ]; Blackman v. Howes, 82 Cal.App.2d 275, 278-279 [ 185 P.2d 1019 , 174 A.L.R. 1004 ].) ” (See also Bell v. Bayly Bros., 53 Cal.App.2d 149, 157 [ 127 P.2d 662 ].) We turn now to the validity of the various transactions even though actual fraud did not exist with respect thereto.

1960(Hobart v. Hobart Estate Co., 26 Cal.2d 412, 440 [ 159 P.2d 958 ]; Bowman v. McPheeters, 77 Cal.App.2d 795, 798, 802-803 [ 176 P.2d 745 ]; Blackman v. Howes, 82 Cal.App.2d 275, 278-279 [ 185 P.2d 1019 , 174 A.L.R. 1004 ].) ” (See also Bell v. Bayly Bros., 53 Cal.App.2d 149, 157 [ 127 P.2d 662 ].) We turn now to the validity of the various transactions even though actual fraud did not exist with respect thereto.

1954Co., 72 Cal.App.2d 550, 567 [ 165 P.2d 260 ]; Mortimer v. Loynes, 74 Cal.App. 2d 160, 170-172 [ 168 P.2d 481 ]; Crabbe v. White, 113 Cal. App.2d 356, 360 [ 248 P.2d 193 ].) When the facts are susceptible to opposing inferences, whether a party had notice of circumstances sufficient to put a prudent man on inquiry as to a particular fact, and whether by prosecuting such inquiry he might have learned such fact, are questions of fact to be determined by the trial court.

1954Co., 72 Cal.App.2d 550, 567 [ 165 P.2d 260 ]; Mortimer v. Loynes, 74 Cal.App. 2d 160, 170-172 [ 168 P.2d 481 ]; Crabbe v. White, 113 Cal. App.2d 356, 360 [ 248 P.2d 193 ].) When the facts are susceptible to opposing inferences, whether a party had notice of circumstances sufficient to put a prudent man on inquiry as to a particular fact, and whether by prosecuting such inquiry he might have learned such fact, are questions of fact to be determined by the trial court.

1954Co., 72 Cal.App.2d 550, 567 [ 165 P.2d 260 ]; Mortimer v. Loynes, 74 Cal.App. 2d 160, 170-172 [ 168 P.2d 481 ]; Crabbe v. White, 113 Cal. App.2d 356, 360 [ 248 P.2d 193 ].) When the facts are susceptible to opposing inferences, whether a party had notice of circumstances sufficient to put a prudent man on inquiry as to a particular fact, and whether by prosecuting such inquiry he might have learned such fact, are questions of fact to be determined by the trial court.

1954Co., 72 Cal.App.2d 550, 567 [ 165 P.2d 260 ]; Mortimer v. Loynes, 74 Cal.App. 2d 160, 170-172 [ 168 P.2d 481 ]; Crabbe v. White, 113 Cal. App.2d 356, 360 [ 248 P.2d 193 ].) When the facts are susceptible to opposing inferences, whether a party had notice of circumstances sufficient to put a prudent man on inquiry as to a particular fact, and whether by prosecuting such inquiry he might have learned such fact, are questions of fact to be determined by the trial court.

1954Co., 72 Cal.App.2d 550, 567 [ 165 P.2d 260 ]; Mortimer v. Loynes, 74 Cal.App. 2d 160, 170-172 [ 168 P.2d 481 ]; Crabbe v. White, 113 Cal. App.2d 356, 360 [ 248 P.2d 193 ].) When the facts are susceptible to opposing inferences, whether a party had notice of circumstances sufficient to put a prudent man on inquiry as to a particular fact, and whether by prosecuting such inquiry he might have learned such fact, are questions of fact to be determined by the trial court.

1954Co., 72 Cal.App.2d 550, 567 [ 165 P.2d 260 ]; Mortimer v. Loynes, 74 Cal.App. 2d 160, 170-172 [ 168 P.2d 481 ]; Crabbe v. White, 113 Cal. App.2d 356, 360 [ 248 P.2d 193 ].) When the facts are susceptible to opposing inferences, whether a party had notice of circumstances sufficient to put a prudent man on inquiry as to a particular fact, and whether by prosecuting such inquiry he might have learned such fact, are questions of fact to be determined by the trial court.

1947Bank v. Bent Bros., 207 Cal. 652, 656 [ 279 P. 765 ]; Nuckolls v. Bank of Calif., 10 Cal.2d 278, 284 [ 74 P.2d 271 ]; Barthelmess v. Cavalier, 2 Cal.App.2d 477, 487 [ 38 P.2d 484 ]; Imperial Gypsum & Oil Co. v. Chaplin, 4 Cal.App.2d 109, 113 [ 40 P.2d 596 ]; see 5 Uniform Laws Annotated, Negotiable Instruments, n. 31-136 to 56; Brannan, Negotiable Instruments, 6th ed., 636-641; Rightmire, Bad Faith in Negotiable Paper, 18 Mich.L.Rev. 355, 367-368; Britton, Bills and Notes, 411-415; 81 U. of Pa.L.Rev. 617.) "Under the statute, section 56, ... a purchaser is not chargeable with notice of an infi

1947Bank v. Bent Bros., 207 Cal. 652, 656 [ 279 P. 765 ]; Nuckolls v. Bank of Calif., 10 Cal.2d 278, 284 [ 74 P.2d 271 ]; Barthelmess v. Cavalier, 2 Cal.App.2d 477, 487 [ 38 P.2d 484 ]; Imperial Gypsum & Oil Co. v. Chaplin, 4 Cal.App.2d 109, 113 [ 40 P.2d 596 ]; see 5 Uniform Laws Annotated, Negotiable Instruments, n. 31-136 to 56; Brannan, Negotiable Instruments, 6th ed., 636-641; Rightmire, Bad Faith in Negotiable Paper, 18 Mich.L.Rev. 355, 367-368; Britton, Bills and Notes, 411-415; 81 U. of Pa.L.Rev. 617.) "Under the statute, section 56, ... a purchaser is not chargeable with notice of an infi

1947Bank v. Bent Bros., 207 Cal. 652, 656 [ 279 P. 765 ]; Nuckolls v. Bank of Calif., 10 Cal.2d 278, 284 [ 74 P.2d 271 ]; Barthelmess v. Cavalier, 2 Cal.App.2d 477, 487 [ 38 P.2d 484 ]; Imperial Gypsum & Oil Co. v. Chaplin, 4 Cal.App.2d 109, 113 [ 40 P.2d 596 ]; see 5 Uniform Laws Annotated, Negotiable Instruments, n. 31-136 to 56; Brannan, Negotiable Instruments, 6th ed., 636-641; Rightmire, Bad Faith in Negotiable Paper, 18 Mich.L.Rev. 355, 367-368; Britton, Bills and Notes, 411-415; 81 U. of Pa.L.Rev. 617.) "Under the statute, section 56, ... a purchaser is not chargeable with notice of an infi

1947Bank v. Bent Bros., 207 Cal. 652, 656 [ 279 P. 765 ]; Nuckolls v. Bank of Calif., 10 Cal.2d 278, 284 [ 74 P.2d 271 ]; Barthelmess v. Cavalier, 2 Cal.App.2d 477, 487 [ 38 P.2d 484 ]; Imperial Gypsum & Oil Co. v. Chaplin, 4 Cal.App.2d 109, 113 [ 40 P.2d 596 ]; see 5 Uniform Laws Annotated, Negotiable Instruments, n. 31-136 to 56; Brannan, Negotiable Instruments, 6th ed., 636-641; Rightmire, Bad Faith in Negotiable Paper, 18 Mich.L.Rev. 355, 367-368; Britton, Bills and Notes, 411-415; 81 U. of Pa.L.Rev. 617.) "Under the statute, section 56, ... a purchaser is not chargeable with notice of an infi

1947Section 3137 of the Civil Code provides that “To constitute notice of an infirmity in the instrument or defect in the title of the person negotiating the same, the person to whom it is negotiated must have had actual knowledge of the infirmity or defect, or knowledge of such facts that his action in taking the instrument amounted to bad faith.” Under this section it is the well-settled rule that “mere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the

1947Section 3137 of the Civil Code provides that “To constitute notice of an infirmity in the instrument or defect in the title of the person negotiating the same, the person to whom it is negotiated must have had actual knowledge of the infirmity or defect, or knowledge of such facts that his action in taking the instrument amounted to bad faith.” Under this section it is the well-settled rule that “mere knowledge of facts sufficient to put a prudent man on inquiry, without actual knowledge, or mere suspicion of an infirmity or defect of title, does not preclude the transferee from occupying the

1947Bank v. Bent Bros., 207 Cal. 652, 656 [ 279 P. 765 ]; Nuckolls v. Bank of Calif., 10 Cal.2d 278, 284 [ 74 P.2d 271 ]; Barthelmess v. Cavalier, 2 Cal.App.2d 477, 487 [ 38 P.2d 484 ]; Imperial Gypsum & Oil Co. v. Chaplin, 4 Cal.App.2d 109, 113 [ 40 P.2d 596 ]; see 5 Uniform Laws Annotated, Negotiable Instruments, n. 31-136 to 56; Brannan, Negotiable Instruments, 6th ed., 636-641; Rightmire, Bad Faith in Negotiable Paper, 18 Mich.L.Rev. 355, 367-368; Britton, Bills and Notes, 411-415; 81 U. of Pa.L.Rev. 617.) "Under the statute, section 56, ... a purchaser is not chargeable with notice of an infi

1947Bank v. Bent Bros., 207 Cal. 652, 656 [ 279 P. 765 ]; Nuckolls v. Bank of Calif., 10 Cal.2d 278, 284 [ 74 P.2d 271 ]; Barthelmess v. Cavalier, 2 Cal.App.2d 477, 487 [ 38 P.2d 484 ]; Imperial Gypsum & Oil Co. v. Chaplin, 4 Cal.App.2d 109, 113 [ 40 P.2d 596 ]; see 5 Uniform Laws Annotated, Negotiable Instruments, n. 31-136 to 56; Brannan, Negotiable Instruments, 6th ed., 636-641; Rightmire, Bad Faith in Negotiable Paper, 18 Mich.L.Rev. 355, 367-368; Britton, Bills and Notes, 411-415; 81 U. of Pa.L.Rev. 617.) "Under the statute, section 56, ... a purchaser is not chargeable with notice of an infi