Cole, J.
The circuit court seemed to suppose that, in subsequent decisions, this court had intimated a doubt as to the correctness of the decision in Crosby v. Roub, 16 Wis. 616, and that, until the principle of that case was re-affirmed, the inferior courts were at liberty to treat the question there decided as an open one. This certainly is a misapprehension, so far as the views of the members of this court are concerned. We have not intended, in any subsequent cases, to cast a doubt upon the soundness of the decision in Crosby r>. Houb; neither have we deemed it necessary to re-affirm that case, whenever it has been criticised or commented on in the discussions at this bar. True, since that decision was rendered, the supreme court of the state of Iowa has had occasion to pass upon the same question as there presented, and that court reached 'a different conclusion. That court held that the transfer [548] of tlie note and mortgage, made in the body of the railroad bond, which is a separate instrument, although intended to transfer the note and mortgage, yet was not a good and sufficient indorsement of the note within the law merchant to pass the legal title so as to exclude the equities of the original parties. Franklin v. Twogood, 18 Iowa, 515; Same Case, 25 id. 520. Of course, a decision of so high and respectable a court as the supreme court of Iowa, adverse to the ruling in Crosby v. JRoub, would strongly incline us to reexamine that case, were we not quite well satisfied with the conclusion already arrived at. But we still think that by the mode of transfer resorted to, as well in that case as the one before us, the parties intended to pass the title and make the note transferable by delivery afterward, as a note payable to order and duly indorsed, and that this contract, like all others which do not contravene any rule of law or public policy, should have effect given to it according to the intent of the parties. And, therefore, we adhere to our views formerly expressed upon this question, that the parties, by the mode of transfer resorted to here, must have intended in a commercial sense to indorse the note, and not merely assign it, and that the indorsement is such as will authorize the holder, who takes it for value, before due, without notice of any defense, to enforce the collection thereof against the maker.
But it is said by the counsel for the respondent, that the evidence in the case shows that the plaintiff is not a holder of the note and mortgage for value, not having received them in the due course of business and paid a valuable consideration therefor. The plaintiff himself testifies upon this point, that he purchased the note and mortgage of his brother, Frederick Bange, prior to the year 1858, paying him seventy-three cents on the dollar therefor, in money, or passing that amount in credits upon his books, on a running account between him and Ms brother. In other words, it seems that the plaintiff, [549] when lie received the note and mortgage, paid for them in cash at the time, at the rate of seventy-three cents on the dollar; or passed them to the credit of his brother upon a current account absolutely as cash, supposing the securities to be good. They were treated as so much cash in the dealings between the plaintiff and his brother. The plaintiff was doing business in New York city, and Frederick Bange was manufacturing iron in Ulster county, 1ST. Y. The latter drew upon the former to a considerable extent, from a quarter to a half a million dollars, the plaintiff taking care of the drafts and Frederick making remittances. At the time of the purchase of the note and mortgage, Frederick had overdrawn to the amount of from ten to thirty thousand dollars, and the amount of these securities was credited to him, and treated as cash in their transactions. Upon these facts there is no ground for saying that the plaintiff is not a purchaser for value within the rule of commercial law. Smith v. Tyson, 16 Peters, 1; Shufeldt v. Pease, 16 Wis. 659 ; Rice v. Cutler, 17 id. 355.
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Cole, J.
The circuit court seemed to suppose that, in subsequent decisions, this court had intimated a doubt as to the correctness of the decision in Crosby v. Roub, 16 Wis. 616, and that, until the principle of that case was re-affirmed, the inferior courts were at liberty to treat the question there decided as an open one. This certainly is a misapprehension, so far as the views of the members of this court are concerned. We have not intended, in any subsequent cases, to cast a doubt upon the soundness of the decision in Crosby r>. Houb; neither have we deemed it necessary to re-affirm that case, whenever it has been criticised or commented on in the discussions at this bar. True, since that decision was rendered, the supreme court of the state of Iowa has had occasion to pass upon the same question as there presented, and that court reached 'a different conclusion. That court held that the transfer [548] of tlie note and mortgage, made in the body of the railroad bond, which is a separate instrument, although intended to transfer the note and mortgage, yet was not a good and sufficient indorsement of the note within the law merchant to pass the legal title so as to exclude the equities of the original parties. Franklin v. Twogood, 18 Iowa, 515; Same Case, 25 id. 520. Of course, a decision of so high and respectable a court as the supreme court of Iowa, adverse to the ruling in Crosby v. JRoub, would strongly incline us to reexamine that case, were we not quite well satisfied with the conclusion already arrived at. But we still think that by the mode of transfer resorted to, as well in that case as the one before us, the parties intended to pass the title and make the note transferable by delivery afterward, as a note payable to order and duly indorsed, and that this contract, like all others which do not contravene any rule of law or public policy, should have effect given to it according to the intent of the parties. And, therefore, we adhere to our views formerly expressed upon this question, that the parties, by the mode of transfer resorted to here, must have intended in a commercial sense to indorse the note, and not merely assign it, and that the indorsement is such as will authorize the holder, who takes it for value, before due, without notice of any defense, to enforce the collection thereof against the maker.
But it is said by the counsel for the respondent, that the evidence in the case shows that the plaintiff is not a holder of the note and mortgage for value, not having received them in the due course of business and paid a valuable consideration therefor. The plaintiff himself testifies upon this point, that he purchased the note and mortgage of his brother, Frederick Bange, prior to the year 1858, paying him seventy-three cents on the dollar therefor, in money, or passing that amount in credits upon his books, on a running account between him and Ms brother. In other words, it seems that the plaintiff, [549] when lie received the note and mortgage, paid for them in cash at the time, at the rate of seventy-three cents on the dollar; or passed them to the credit of his brother upon a current account absolutely as cash, supposing the securities to be good. They were treated as so much cash in the dealings between the plaintiff and his brother. The plaintiff was doing business in New York city, and Frederick Bange was manufacturing iron in Ulster county, 1ST. Y. The latter drew upon the former to a considerable extent, from a quarter to a half a million dollars, the plaintiff taking care of the drafts and Frederick making remittances. At the time of the purchase of the note and mortgage, Frederick had overdrawn to the amount of from ten to thirty thousand dollars, and the amount of these securities was credited to him, and treated as cash in their transactions. Upon these facts there is no ground for saying that the plaintiff is not a purchaser for value within the rule of commercial law. Smith v. Tyson, 16 Peters, 1; Shufeldt v. Pease, 16 Wis. 659 ; Rice v. Cutler, 17 id. 355.
It was further insisted that the evidence in the case shows that the note and mortgage were obtained and put in circulation by false and fraudulent representations made to the maker by the agents of the railroad company ; and this being so, it is claimed that the rule is well settled that the plaintiff can recover no more than he paid for the securities, and the interest on that amount. The plaintiff purchased the note an4 mortgage prior to 1858, paying about seventy-three cents on the dollar. The purchase was absolute, and the entire amount which may be recovered on the securities belongs to him. He must be regarded as having taken them in the usual course of business, without knowledge of any equities existing between the original parties, and paying what certainly was a fair and valuable consideration for paper which would not become due until January 1, 1864. In the case of accommodation paper, or where a note has [550] been misappropriated by a party into whose hands it was placed for a special purpose, it has been held that even a bona fide holder, in an action against the maker, should only recover the amount actually advanced. Wiffin v. Roberts, 1 Esp. 261; Jones v. Hibbert, 2 Stark. 204; Allaire v. Hartshorne, 1 Zab. 665. And also, “when the plaintiff is the holder for value and bona fide, for a portion only of the amount of the note, and the excess, if recovered by him, would be for the benefit of the payee or other party against whom the defense ought to avail, then the defendant is entitled to the benefit of his defense against the plaintiff as to such excess. To that extent the plaintiff represents the original parties, and the defense is properly allowed to prevent a recovery for their benefit when they would not be entitled to recover for themselves.” Tobey v. Chipman, 13 Allen, 123 ; Tucker v. Jenkes, 5 id. 330. But in this state, where it has been held that the transfer of a negotiable promissory note, although secured by a mortgage on real estate, to a bona fide indorsee, entitles the holder, in an action to foreclose the mortgage, to the protection accorded the holder of commercial paper, we see no ground for applying any such principle, or for saying that the plaintiff, upon the facts of this case, shall only recover the amount he paid for the securities, and interest thereon. Such a rule would certainly deprive the plaintiff of the benefit of the principle first announced, for it would be equivalent to saying that, unless he paid the face of the paper, he was not a holder for value. In no case which has fallen under our observation, analogous in its facts to the one before us, has it been held that the holder must pay the full face of the security in order to be entitled to protection or to constitute him a holder for value. In Gould v. Segee, 5 Duer, 260, Justice Dttee says: “ When a parting with value is proved, the amount of the consideration is not otherwise important than as bearing upon the question of actual or constructive nqtice.” Here we [551] must assume that the plaintiff paid what the securities were reasonably and fairly worth. And to hold that he can only recover the amount he paid would be establishing a rule which would deprive all paper of this character, which for any cause was not worth its face, of one of the most essential and valuable incidents of negotiability, and effectually put a stop to its circulation. Rannet, J., in Baily v. Smith, 14 Ohio St. 396-403. Under the circumstances, we think the plaintiff cannot be limited in his recovery to the amount he actually paid, and interest thereon, but that he is entitled to recover the full amount due upon the note and mortgage.
By the Court. — The judgment of the circuit court is reversed, and the cause remanded, with directions to enter judgment for the plaintiff for the amount due.