
    City National Bank of Paducah v. J. R. Smith.
    [Abstract Kentucky Law Reporter, Yol. 1 — 351.]
    Renewal of Bills Secured by Collateral.
    The renewal of an obligation will not release bonds held by the creditor as collateral security for,the debt, but where such renewals are by new firms and with new parties to the bills, without the knowledge and consent of the owners, it.will amount to a surrender of all claims to hold the bonds as collateral.
    appeal prom McCracken court op common pleas.
    October 8, 1880.
    
      
      Bigger & Reid, for appellant.
    
    
      William Lindsay, I. C. Gilbert, for appellee.
    
   Opinion by

Judge Hines:

The court to which the law and facts were submitted without a jury was authorized from the evidence to find that appellee consented that his bonds should be used as collateral security for Corbett & Peterson alone, that the bank had notice of that fact, and that the bonds belonged to appellee -prior to the'maturity of the loan for which the bonds were deposited, and prior to the renewal by the firm of Corbett, Peterson & Co. Having knowledge of these facts, appellant had no right to hold the bonds as collateral security for the renewal by Corbett, Peterson & Co. and Peterson, Gardner & Ryan. Such renewals by these new firms and with new parties to the bills, without the knowledge and consent of the appellee, was a surrender of all claim to hold the bonds under the agreement with Corbett & Peterson for the $5,000 loan.

There appears to be no reason for disturbing the judgment because the court heard evidence of the value of the bonds in the absence of counsel for the appellant. It is not claimed that the value fixed by the court is not the correct one, and besides, the court offered to permit appellant to introduce additional evidence as to the value of the bonds, which appellant refused to do unless the court would set aside the entire judgment. There is nothing to indicate that appellant has suffered any injury by the introduction of this evidence in the absence of its counsel.

Wherefore the judgment is affirmed.  