Weston v. Bear River & Auburn Water & Mining Co. , 6 Cal. 425 ( 1856 )

The opinion of the Court was delivered by Mr. Chief Justice Murray.

Mr. Justice Heydenfeldt concurred.

A party who purchases at sheriff's sale, stocks of an incorporation, knowing that the certificates of such stock have been previously hypothecated, is chargeable with notice of such fact, and takes subject to the claim of the pledgee. Neither the incorporation law of 1850, or of 1853, was intended to cover a' case of this kind, but apply only to transfers and purchases in good faith without notice.

In the case of Weston v. The Bear River Water and Mining Company, decided at the April term, 1855, this point was not presented to the consideration of the Court, and the case went off on a construction of the statute only.

In the present case, the fact is found by the Court below, and upon that finding it results that the plaintiff, who knew of the hypothecation of the certificates, is not a purchaser in good faith, and therefore not entitled to relief in a Court of equity.

The statute of 1853 does not substantially alter the law of 1850, and as the construction established in the former decision, is now generally understood, and acted upon, public policy demands that it should be maintained.

Judgment reversed.