King

This is an action based upon a bond and interest coupons of the Southern Pacific Railway Company. Judgment was rendered in favor of plaintiff and against defendant for the return of the bond and coupons, or their value in case delivery thereof could not be had. Defendant appeals from the judgment under the alternative method.

The bond in suit is one issued by the Southern Pacific Railroad Company, having semi-annual coupons attached, known as a first refunding mortgage gold $1,000 bond. It is made payable to bearer and secured by a mortgage on certain real and personal property of the Southern Pacific Company, as set forth upon the face of the bonds. As the transactions involved herein occurred in 1914, prior to the amendment of sections 3088 and 3093 of the Civil Code (Stats. 1915, p. 99; Stats. 1917, p. 1535), the bond was nonnegotiable. (Kohn v. Sacramento Elec., Gas & Ry. Co., 168 Cal. 1 , [ 141 Pac. 626 ]; Crocker Nat. Bank v. Byrne & McDonnell, 178 Cal. 329 , [ 173 Pac. 752 ].) Defendant thus took the bond subject to all legal or equitable defenses.

The bond came into the possession of defendant in the following manner: It was part of the assets of the estate of Patrick…