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what two sovereigns...
The two sovereigns that offered competing rules in Swift were the state of New
York and what Justice Story terms "general law". New York law stated that a
pre-existing debt did not constitute a baluable consideration applicable to
negotiable instruments. General law seemed to be based on general legal
principles and jurisprudence which federal courts could draw upon to formulate
their own "laws". According to Swift, general law principles stated that a
pre-existing debt is valuable consideration regardless of the equities between
antecedent partners when a bona fide holder had no notice of these equities.