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set-off in the defence of any suit, if it appear on the trial that such note or bill was lost while it belonged to the party claiming the amount due thereon, parol or other evidence of the contents thereof may be given, on such trial, and notwithstanding such note or bill was negotiable, such party shall be entitled to recover the amount due thereon, as if such note or bill had been produced.

But to entitle a party to such recovery, he shall execute a bond to the adverse party, in a penalty at least double the amount of such note or bill, with two sureties, to be approved by the court in which the trial shall be had, conditioned to indemnify the adverse party, his heirs and personal representatives, against all claims by any other person on account of such note or bill, and against all costs and expenses by reason of such claim.



1. What bill or note may be so transferred as to give the holder a right of action thereon.

The law of merchants distinguishes bills of exchange from other contracts by making them assignable; this is for the convenience of commerce, that they may pass from hand to hand in the way of trade as if they were specie. 1 Str. 441.

If a man has a bill payable to him or bearer, and he delivers it over for money received, without endorsement of it, this is a plain sale of the bill, and he who sells it does not become a new security; but if he endorse on it he becomes a new security, and then he is liable on the endorsement. Holt, C. J., Bank of England v. Newman, 1 Ld. Raym. 442; 12 Mod. 241.

It is said in Marius, that a note may be made payable either to A or bearer, A or order, or to A only. 6 T. R. 123. And this is true for the most part under the statute of Ann.

A note, payable to bearer, is negotiable under that statute and transferrable without endorsement; and if the payee puts his name on the back, he is as much bound as an endorser as if the note had been made payable to him or order. Brush v. Reeves' adm'rs, 3 Johns. 439; Eccles v. Ballard, 2 McCord 388; Allwood v. Haselden, 2 Bailey 457. And he is entitled to the privileges of endorser; among which are demand on

the maker and notice of dishonour. Dean v. Hall, 17 Wend. 214; Seabury v. Hungerford, 2 Hill 80.

If the bill be drawn payable to A or order, bare delivery will not transfer the right: the order of A is necessary to enable a third party to enforce payment. Tindal, C. J. 3 Bingh. N. C. 828. But such order may be made by endorsement. The construction of a note, whereby the maker promised to pay J. R. W. to the order of S. J. and L. J., was that J. R. W. is not the payee but the person to whom the payees were to endorse it by the request of the maker. They having accordingly endorsed it, the legal title is derived through them to their endorsee, and he may maintain an action on the note in his name. Willis v. Green, 10 Wend. 516, 5 Hill 232.

The third case mentioned by Marius-a note payable to A only is not embraced in the statute of Ann. The case of Burchell v. Slocock, 2 Ld. Raym. 1545, is often referred to as authority for the position that such an instrument is a promissory note under the statute; but it does not appear to sustain the position. Being an action on the case, by the administrator of the payee against the maker, the count was good if it shewed a promise on sufficient consideration. Now the allegation was that the defendant and another made a note, by which they jointly and severally promised to pay, &c. for value received, from the premises in the street called Rosemary lane, late in the possession of one T. R. S. It was by reason of the said premises and also by force of the statute that the plaintiff sued. True it was shewn for cause of demurrer that the note was not within the statute; and the reporter states that the court held it was; but in his marginal abstract he describes the note as being to "J. S. or order."

Upon the authority of this case, and that of Smith v. Kendall, 6 T. R. 123, cited ante, p. 174, the supreme court of New York, under a statute the same in substance as the statute of Ann, has held that a note, though it has not the words "or bearer," or the words "or order," is a good promissory note within the statute, and may be declared on as such by the payee. Downing v. Backenstoes, 3 Caines's Rep. 136; Goshen Turnpike Co. v. Hurlin, 9 Johns. 217, 18. The court, therefore, deemed it not requisite to aver a consideration; but in the last case it remarks that a consideration appears on the face of the note.

According to Marius, if a bill be not payable to a man or his assigns or order, the assignment of it will not avail. Under the statute of Ann, there is a like rule as to promissory notes. Unless there be in the instrument authority to endorse, the endorsee cannot, under the law-merchant or under that

statute, sue on a bill of exchange or a promissory note. Hill v. Lewis, 1 Salk. 133; 2 B. Monroe 312. It has been so held in Pennsylvania, Gerard v. La Coste &c. 1 Dall. 195; and Maryland. To enable an assignee to maintain an action in his own name on a promissory note against the maker, the court of appeals of Maryland held it essential under the statute of Ann that the words "or order," or "bearer," or words equivalent, should be inserted in the note. Noland v. Ringgold, 3 Har. & J. 216. So in England, where there was by the note a simple promise to pay to R. & W., (without the words "or order,") and the note was endorsed by R. & W. and J. K. & Co., it was considered that the holder could not sue on it. Plimley &c. v. Westley, 2 Bingh. N. C. 249, 29 Eng. Com. Law Rep. 322; Parke, B., 6 M. & W. 426.

2. What is necessary to constitute a valid endorsement. Cases in which there was question as to the sufficiency of the delivery.

A bill may be endorsed to a party in two ways; either by special endorsement making it payable to that party; or by a blank endorsement and delivery to that party. In the latter way, if not in the former, the bill must be delivered to the party as endorsee, in order to constitute an endorsement to him. Wood, B., 5 Price 442; Adams v. Jones, 12 Adol. & El. 455, 40 Eng. Com. Law Rep. 94; Brind v. Hampshire, 1 M. & W. 369; Bayley on Bills, p. 98 of 4th edi.; Marston v. Allen, 8 M. & W. 494.

It may be sufficient to shew a constructive delivery—an act which puts the note into the power or under the control of the endorsee. Richardson v. Lincoln, 5 Metcalf 203. But if the holder of a note simply makes an endorsement upon it, directing it to be paid to a third person, and retains it in his own possession, no interest vests in the endorsee. Clark v. Boyd, 2 Hammond 60, 61. On a note the holder wrote his name, and after his death his executrix delivered the note to the plaintiffs, without endorsing it; so that there was a writing of his name by the deceased and a delivery by his execu trix. These acts did not constitute an endorsement of the note; the person to whom it was so delivered, had no right to sue upon it. Bromage &c. v. Lloyd &c. 1 W. H. & G. 32.

In Adams v. Jones, and Marston v. Allen, it was not intended that the transferree should ever take any interest in the bills. It was considered the same thing in principle where the intention was that the transferrees should not take any interest in the bills until old bills were returned-that no interest

should pass till that time: the bills were received on terms which were not satisfied, and there was no endorsement. Bell v. Ingestre, 12 Adol. & El. N. S. 317, 64 Eng. Com. Law Rep. 317. "An endorsement," Lord Campbell observes, "requires that there shall be a delivery of the bill, with an intent to make the person to whom it is endorsed owner of the bill- —a party to the bill-and transferree of the property in it. There is no endorsement if the holder merely writes on the bill a direction to pay it to another person, and the other person gets possession without the holder's consent. Nor is there any endorsement, though the holder give that person possession of the bill, if the delivery be merely for a collateral purpose, and without the intention to make him transferree of the property in the bill." Lloyd v. Howard, 15 Adol. & El. N. S. 999, 69 Eng. Com. Law Rep. 999, 1 Eng. Law & Eq. 227.

But if the holder puts his name on the back of a bill, and delivers it to his agent, who delivers it to a third person for value, that is an endorsement from the holder to such third person. Parke, B. in Barber v. Richards, 6 W. H. & G. 64. Here Edwards put his name on the back of the bill, and delivered to his agent, Brown, who disobeyed his order to get it discounted, and pledged it for value to Tingey. It was considered that there was a valid endorsement from Edwards. to Tingey; for though as between them there may have been no intention to give the latter a title, there was an intention to give a title to the person to whom Brown might deliver the bill, and he delivered it to Tingey. There being no fraud on Tingey's part, the property passed to him. On the same principle, the supreme court of New York decided Vallett v. Parker, 6 Johns. 620.

3. As to the terms in which the endorsement is written; if endorsement be in blank, right to fill it up.

When the payee endorses a negotiable note to a third person, though the endorsement contain a stipulation that the endorser is not to be responsible if the maker does not pay, this does not affect the negotiability of the paper, nor prevent the property of the note passing to the endorsee; he may, nevertheless, sue the promisers upon it in his own name. Rice v. Stearns &c. 3 Mass. 227; Richardson v. Lincoln, 5 Metcalf 204; Epler v. Funk, 8 Barr 468; Bisbing v. Graham, 2 Harris 16.

In the case of a blank endorsement, it is well settled to be competent for the holder to make himself the endorsee, by filling up the blank endorsement with proper words. LamVOL. II.-15

bert v. Oakes, 1 Ld. Raym. 443; 12 Metcalf 453; Ritchie &c. v. Moore &c. 5 Munf. 395. It may be filled up at any time before the trial of the suit brought by the party claiming under that endorsement. Evans v. Gee, 11 Peters 84. It is no valid objection that the endorsement remained blank during the endorser's life, and was not filled up till after his death. Cope v. Daniel, 9 Dana 415. Indeed, however it may have been decided to the contrary in North Carolina, (Whitehead v. Potter, 4 Iredell 266,) or Maryland, (Hudson v. Godwin, 5 Har. & J. 115, and Day &c. v. Lyon, 6 Id. 140,) it is not in Virginia material that it should be filled up at all. 5 Munf. 395. For the blank endorsement proves the assent of the endorser to transfer the instrument if the holder elect to treat it as a transfer; and such election is proved as well by the holder's suing on it as by writing over it an assignment. Hence an appellate court will regard it no valid objection to a judg ment for the endorsee, that by the note made part of the record, the endorsement appears to be in blank. Rees v. Conococheague Bank, 5 Rand. 326. The contrary decisions in Maryland, above referred to, led no doubt to the Maryland act of 1825, ch. 35; which makes the rule there similar to what it is in Virginia-at least so far as it relates to the action of the appellate court. Whiteford v. Buckmyer &c. 1 Gill 147.

When the name of the payee is not endorsed in blank, but is annexed to a guaranty of payment of the note, the purpose of the signature being expressed, there can be no implication. that the purpose was to transfer the note as endorser generally. It is therefore held that such a guaranty will not authorize a person to sue in his own name as endorsee. It is so where in the writing signed by the payee no name is inserted of the party entitled to hold by the endorsement. Tyler v. Binney, 7 Mass. 479. Though a different view seems to have been taken in Blakely v. Grant, 6 Mass. 386, the supreme court of Massachusetts has since adopted Tyler v. Binney as the better opinion. It so said in a case wherein the endorsement was open to the farther objection that it was not by the payee alone, but a joint guaranty of him and another. This could not be transformed into a general endorsement by the payee. Tuttle v. Bartholomew, 12 Metcalf 452. Irrespective of that, however, the plaintiff could not enforce payment by a suit in his own name as endorsee. Belcher v. Smith, 7 Cush. 482. Notwithstanding the case of Upham v. Prince, 12 Mass. 14, the principle is established in Massachusetts, that an instrument filled up and complete in itself as a guaranty of payment of a note, cannot be altered by striking out or inserting words, to make it a general endorsement. True v. Fuller, 21 Pick. 140, 12 Metcalf 454.

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