The petition charged that for a valuable consideration from John S. Storrs to him thereunto moving, said Daniel E. Watrous executed and delivered to said Storrs the instrument of writing above set out, and that thereby said Watrous undertook, and bound himself, and became liable to pay said sum therein specified.

To this petition the defendants filed a general and special demurrer, which were both overruled by the court, and judgment was rendered for the plaintiffs, and the defendants took their bills of exception to the ruling of the court, and brought the case here by appeal.

The only question now presented for decision is, does this instrument, independent of any allegations of ownership for a valuable consideration, or promise to pay, give the holder any cause of action.

This instrument is not a promissory note in its ordinary form, nor can it be treated as such, since there is no promise to pay in any event. The instrument is directed to no one, and therefore cannot be considered a draft or bill of exchange. Had it been accepted by any one, that acceptance would have constituted a promise to pay in the acceptor, and then the maker might have become liable as surety or guarantor; but as there is no drawee or acceptor, the maker cannot, without allegations and proof of other facts setting forth and establishing his liability, be held responsible. The instrument, with the exception of the want of a drawee, is in the ordinary form of an accommodation bill or draft, on which the maker cannot be held liable until after an acceptance or non-acceptance. We think the instrument, as it is, is an imperfect bill or draft, for the payment of which no one is liable. With proper averments, showing the objects and purpose of the parties, and that the maker intended to bind himself in the first instance to pay the same, he might possibly be held responsible without a drawee or acceptor, but not otherwise.

We can see no material difference between the writing here sued on and the one in Ball v. Allen (15 Mass. 433), in which the court says: "But the mere possession of a paper drawn in the form of an order, there being no drawee in existence, we think cannot entitle the possessor to an action in any form."

The same doctrine may be drawn from Peto v. Reynolds (9 Exch. R. 414) and in Davis v. Clark (4 Eng. Com. Law R. 177). From these authorities, and the reason of law governing instruments of this or the like character, we are clearly of the opinion that the petition in this case did not set out a good cause of action, and that the court erred in overruling defendant's special demurrer to the same. We think the demurrer should have been sustained and the plaintiffs permitted to amend their pleadings, that, if desired, they might, by proper averments and proof, establish the liability of the maker or drawer in the first instance, without an acceptance or non-acceptance.

The judgment of the District Court is reversed and the cause remanded.

Reversed and remanded."

§ 20 FUNK v. BABBITT, 156 Ill. 408. 1895. "B. Apr. 23, 1891. Thirty days after date pay to the order of E. D. Babbitt $350, for value received. Funk & Lackey." MR. JUSTICE BAKER: "Said instruments were declared on as promissory notes. It is urged that they are not notes, or even promises to pay, and, not being directed to any one, do not constitute drafts or orders, and in fact amount to no more than blank pieces of paper. They are, undoubtedly, very irregular and informal instruments, but they are not void as written evidences of indebtedness. A person may draw a bill upon himself, payable to a third person, in which case he is both drawer and drawee. Here the firm drew bills, but did not address them to any third person or persons, and it is therefore to be regarded that they were, in legal effect, addressed to themselves, as drawees, and the signatures of the firm to the several bills bound the firm both as drawers and acceptors. The instruments are inland bills of exchange, to which the firm sustains the triple relation of drawers, drawees, and acceptors, and as the declaration contains the consolidated common counts, the bills were admissible in evidence under them. Moreover, the drawers and drawees being the same, the bills are, in legal effect, promissory notes, and may be treated as such, or as bills, at the holder's option. (1 Daniel on Neg. Inst., §§ 128, 129)."

$ 20 WHEELER v. WEBSTER, 1 E. D. Smith (N. Y. C. P.) 1 (1850). By the Court, INGRAHAM, FIRST J. "I am of the opinion that the omission of the name of the drawee at the foot of the bill will not vitiate it. The acceptance may be considered as supplying the defect, and as being an admission by the acceptor, that he is the person intended. At any rate, it does not lie with him to make such defense, after having admitted, by the acceptance, that he was the person intended, and after having promised to pay the draft at maturity. He is estopped, by his own act, from such a defense."

5 In Peto v. Reynolds, (9 Exch. 410), cited above, the bill was not addressed to any drawee, but across the face was written: " Accepted, Samuel Reynolds, Esq., Shorn Lane, Bedminster, Bristol." One Righton (the drawer of the bill) wrote this acceptance. Defendant denied Righton's authority. There was evidence that defendant had orally promised to pay the bill, but whether absolutely or conditionally was not clear. Plaintiff had a verdict. The court held there must be a new trial because of the unsatisfactory state of the evidence. Three of the four judges expressed the opinion, however, that the instrument was not a bill of exchange for the want of a drawee, but might be treated as a promissory note if Reynolds, in fact, ratified the signature. - H.

VI. Delivery essential.

§ 35

HILLSDALE COLLEGE v. THOMAS.

40 WISCONSIN, 661.

- 1876.

ACTION on a promissory note signed by defendant's testator and payable to plaintiff.

The answer is to the effect that one Parmalee, an agent of the plaintiff, called upon the defendant's testator, and solicited him to purchase a scholarship in the plaintiff college, which he at first refused to do; that finally, at the request of Parmalee, he signed the note in suit, and left it with Parmalee, under an agreement that the latter should hold it for the testator until a certain time, to be returned to the testator in case he should not decide to purchase such scholarship, and in the meantime the note should not be considered as delivered to the plaintiff; and that at the specified time, the testator informed Parmalee that he had decided not to purchase the scholarship, and demanded a return to him of the note, but Parmalee, professing to have sent the note by mistake to the plaintiff, did not comply with such demand.

On the trial, by proof and the defendant's admissions, plaintiff made a prima facie case. Defendant offered testimony tending to prove the averments of the answer, but an objection to its admission was sustained; and the jury, by direction of the court, returned a verdict for the plaintiff for the amount due on the note by its terms. From a judgment entered on such verdict the defendant appealed.

LYON, J. The ruling of the court rejecting all testimony under the answer is equivalent to an order sustaining a general demurrer thereto. It is an adjudication that the answer does not contain facts sufficient to constitute a defense to the action. If it states a defense, the ruling is erroneous and fatal to the judgment. We have no doubt whatever that the answer states a complete defense to the action, and that the testimony offered to prove the allegations thereof should have been. received.

The note was not left with Parmalee, the agent of the plaintiff, as an escrow. On the contrary, the defendant's testator retained the absolute control of the note, and the right to recall it if he chose to do so. Such a deposit has none of the essential features of a delivery in escrow, and hence we are not called upon to determine the legal effect of the delivery of a note in escrow to the agent of the payee."

While it is now generally conceded that a negotiable instrument may be delivered in escrow to a third person for the payee, the same as a sealed instrument, it is a disputed question whether it may be so delivered in escrow directly to the payee or his agent. The following cases hold that it may not: Stewart v. Anderson, 59 Ind. 375; Jones v. Shaw, 67 Mo. 667; Garner v. Fite, 93 Ala. 405; Carter v. Moulton, 51 Kans. 9. The following cases hold that it may: Burke v. Dulaney, 153 U. S. 228; Benton v. Martin, 52 N. Y. 570; Wat

There was no delivery of the instrument, and hence it never had an inception or legal existence as the note or obligation of the testator. It remained mere waste paper, just as it would have been had the testator kept it in his pocket instead of leaving it with Parmalee. The fact that Parmalee was the agent of the plaintiff is of no importance. Were the plaintiff a natural person, and had the testator left the note with such person under the same circumstances, it would not be a delivery, and would confer no right of action. Had the paper been put in circulation, and were the plaintiff a bona fide holder thereof, for value, before due, we would or might have to determine whether or not the testator had been guilty of negligence in the premises. But we have no such question in this action. These views are abundantly sustained by the following cases: Walker v. Ebert, 29 Wis. 194; Kellogg v. Steiner, Id. 626; Butler v. Carns, 37 Id. 61; Thomas v. Watkins, 16 Id. 549; Chipman v. Tucker, 38 Id. 43; Roberts v. McGrath, Id. 52; Roberts v. Wood, Id. 60.

Judgment reversed and a new trial awarded."

§ 35

KINYON v. WOHLFORD.

17 MINNESOTA, 239. — 1871.

ACTION on a promissory note, brought in the District Court for Steele county, resulting in a verdict for the defendant. Plaintiff moved for a new trial, which was denied, and he appeals to this court from the order denying such new trial. A single point only is discussed in the appeal, which is fully stated in the opinion.

By the Court- BERRY, J. This is an action upon a promissory note payable by its terms to C. W. Stevens, or bearer, and signed by the defendant.

There was plenary evidence showing that the plaintiff is a bona fide holder of the note, having purchased the same before maturity in good faith, without notice, and for value.

The only defense urged here is that there was no delivery of the

kins v. Bowers, 119 Mass. 383; Brown v. St. Charles, 66 Mich. 71; Sweet v. Stevens, 7 R. I. 375. — H.

[For authorities on the admissibility of parol evidence to show conditional delivery of bill or note see the following: Beach v. Nevins, 162 Fed. 129, 18 L. N. S. 288 with note; Graham v. Remmel, 76 Ark. 140; St. Paul's Ep. Ch. v. Fields, 81 Conn. 670; Murray v. W. W. Kimball Co., 10 Ind. App. 141, 184; Oakland Cem. Ass'n v. Lakins, 126 Iowa, 121, 3 A. & E. Ann. Cas. 559 with note; McNight v. Parsons, 135 Iowa, 390, 15 A. & E. Ann. Cas. 665 with note: Hurt v. Ford, 142 Mo. 283; Jamestown Bus. College v. Allen, 172 N. Y. 201, 92 Am. St. Rep. 740 with note. — C.]

7 See note on "Instruments put in circulation in violation of instructions or conditions" in 11 Am. St. Rep. 314-316. — C.

note to any person by or on behalf of the defendant; that for want of delivery it is not the note of defendant, and he is not liable thereon. even to a bona fide holder. "A bona fide holder for value, without notice, is entitled to recover upon any negotiable instrument, which he has received before it has become due, notwithstanding any defect or infirmity in the title of the person from whom he derived it; as, for example, even though such person may have acquired it by fraud, or even by theft, or by robbery." (Story on Prom. Notes, § 191; 2 Gr. Ev., § 171; Swift v. Tyson, 16 Pet. 1; Goodman v. Symonds, 20 Howard 365; Raphael v. Bank of England, 17 C. B. 162; Wheeler v. Guild, 20 Pick. 545; Magee v. Badger, 34 N. Y. 249; Powers v. Ball, 27 Vt. 662; Catlin v. Hamon, 1 Duer, 325; Gould v. Seger, 5 Duer, 268; Marston v. Allen, 8 Mees. & W. 494; Sm. Lea. Cas. 597 et seq.; 1 Ross, Lead. Cases, 205 et seq.)

The fact that there has been no delivery of the instrument by or for the maker, or by or for an indorser through whom the holder must claim, is a defect or infirmity of title within the meaning of the rule above cited, a rule which is said to be laid up among the fundamentals of the law. (Worcester Co. Bank v. Dorch. & Melton Bk., 10 Cush. 488; Edwards on Bills and Notes, 188; Gould v. Seger, supra; Ingham v. Primrose, 7 C. B. (N. S.) 82; Shippey v. Carroll, 45 Ill. 285; Clark v. Johnson, 52 Ill.)

The order denying a new trial must be reversed.

8 For an excellent case setting forth with great persuasiveness the contrary doctrine, see Salley v. Terrill, 95 Me. 553. In this case the defendant was engaged in a lumbering operation, and Hurd was in his employ. Among his duties was that of keeping the time of the men in the woods, and when one was discharged to draw an order on the defendant for the amount due. Blank orders were furnished Hurd by the defendant for this purpose. As a matter of practice, Hurd drew an order on the defendant, payable to the order of Harry Carter, for $75.25, the same being in full settlement for cooking. This order was never delivered to Carter, nor intended to be delivered. Hurd left it on his table, with other papers, for a few moments, while he was called away, and on his return he took all the papers and everything, and burnt them up, and supposed the order was thus burned. Carter in the meantime had abstracted the order. Later Hurd, thinking of the order, asked Carter, who had been near when it was written, if he had seen it, and he said he had not. Carter negotiated the order to the plaintiff for a valuable consideration without notice of the facts.

Judgment was rendered for defendant, the court saying: "In the case before us, where the order had never been delivered, and therefore had no legal inception or existence as an order, the question is whether there is any liability upon it to an innocent indorsee for value. As is said in Burson v. Huntington, 21 Mich. 415: The wrongful act of a thief or a trespasser may deprive the holder of his property in a note which has once become a note or property by delivery, and may transfer the title to an innocent purchaser for value. But a note in the hands of a maker before delivery is not property, nor the subject of ownership, as such. It is in law but a blank piece of paper. Can the theft or wrongful seizure of this paper create a valid contract on the