
    Ware, et al. vs. Childress.
    Where an Attorney General took a note for taxes due the State, payable to himself, from a sheriff in default, it is held that the State was entitled to the proceeds of the note in the hands of a person holding it as a collateral security or in the hands of one who had not received it in due course of trade.
    Childress recovered a judgment in the circuit court of Haywood county against Ware, on anote executed by Ware to Miller. Ware filed his bill in the chancery court at Brownsville, and obtained an injunction against the judgment. The State of Tennessee filed her cross-bill, claiming the proceeds of the note; and the cases were heard on bill and cross-bill, answers, replication and proof. The chancellor dismissed the bill and cross-bill. The State appealed.
    
      Attorney General, for the State.
    
      Totten, for Ware.
    
      McLanahan, for Childress.
   Turley, J.

delivered the opinion of the court.

This is a struggle between the State of Tennessee and E. H. Childress for a fund in the hands of Mansfield Ware, under the following circumstances: Mansfield Ware was the sheriff of Haywood county, and, as such, became indebted to the State for taxes collected by him. William B. Miller was attorney general for the' solicitorial district of which the county of Haywood was a part. The claim in favor of the State against Ware was placed by the Comptroller in his hands for collection. Ware, instead of paying the money, executed his note, with endorsers, to Miller for the amount, with the intention of having it discounted at the Union Bank at Jackson; this not being done, Ware afterwards paid Miller the amount in money, but neglected to take up his note. Miller,- being indebted to defendant, Childress, transferred this note of Ware, after it fell due, to him, as collateral security for his debt. Ware, upon being sued, complaine d to Miller about this breach of faith,, who repaid to him the money he had received from him, having never paid it over to the State. The consequence of all this is, that the State has never collected, nor Ware paid, this debt. The note in controversy having been given to secure this debt, the State of Tennessee is entitled to it, unless there be something in Childress’ position which gives him a superior 'equity; and we think there is nothing. If the note had remained in the hands of Miller, no one doubts that the State would have been entitled to it; it having been assigned after it fell due, Childress occupies Miller’s position, and holds the paper subject to all equities. But, furthermore, the assignment is duly made as collateral security for a debt previously due, and, therefore, under the decisions of this State, the assignee did not acquire the note in due course of trade, and cannot, therefore hold it protected from equity, to which it would have been liable in the hands of Miller.

The judgment of the chancellor will, therefore, be reversed, and a decree for the amount due from-Ware given in favor of the State.  