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Newton v. Porter
New York Court of Appeals
69 N.Y. 133 (1877)
Newton (plaintiff) owned government bonds totaling $13,000. These bonds were stolen by William Warner and George Warner. The Warners sold the bonds and invested the proceeds into loans secured by a promissory note, a bond, and a mortgage. The Warners were arrested and indicted for the crime of stealing the bonds. The Warners hired attorneys (defendants) to defend them and paid the attorneys by transferring the promissory notes and assigning the bond and mortgage to the attorneys. The plaintiff sued the attorneys to recover the promissory notes, the bond, and the mortgage, which were proceeds from the sale of the government bonds stolen from the plaintiff. The trial court ruled that the attorneys had notice that the securities were proceeds from the stolen bonds and awarded judgment in favor of the plaintiff. The attorneys appealed to the New York Court of Appeals.
Rule of Law
Holding and Reasoning (Andrews, J.)
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