ARTICLE IV. NEGOTIATION. I. What constitutes negotiation or transfer. § 60 CROUCH v. CREDIT FONCIER, L. R. 8 Q. B. 374. (1873.) BLACKBURN, J. In the present case the plaintiff has taken upon himself the burden of establishing both that the property in the debenture passed to him by delivery, and that the right to sue in his own name was transferred to him. The two propositions are very much connected, but not identical. The holder of an overdue bill or note may confer the right on the transferee to sue in his own name, but he conveys no better title than he had himself. * * * But the two questions go very much together; and, indeed, in the notes to Miller v. Race (1 Smith, L. C. 9th ed., p. 491), where all the authorities are collected, the very learned author says: "It may therefore be laid down as a safe rule that where an instrument is by the custom of trade transferable, like cash, by delivery, and is also capable of being sued upon by the person holding it pro tempore, then it is entitled to the name of a negotiable instrument, and the property in it passes to a bona fide transferee for value, though the transfer may not have taken place in market overt. But that if either of the above requisites be wanting, i. e., if it be either not accustomably transferable, or, though it be accustomably transferable, yet, if its nature be such as to render it incapable of being put in suit by the party holding it pro tempore, it is not a negotiable instrument, nor will delivery of it pass the property of it to a vendee, however bona fide, if the transferor himself have not a good title to it, and the transfer be made out of market overt." Bills of exchange and promissory notes, whether payable to order or to bearer, are by the law merchant negotiable in both senses of the word. The person who, by a genuine indorsement, or, where it is payable to bearer, by a delivery, becomes holder, may sue in his own name on the contract, and if he is a bona fide holder for value, he has a good title notwithstanding any defect of title in the party (whether indorser or deliverer) from whom he took it.' 1 For a luminous discussion of " negotiability," see Willis on Negotiable Securities (1896), Lectures I and II.- H. § 60 1. TRANSFER BY DELIVERY. BITZER v. WAGER. 83 MICHIGAN, 223. 1890. ACTION on the following promissory note: $100.00. HART, MICH., March 20, 1889. Eight months after date I promise to pay to the order of Marget A. Bitzer (or bearer), one hundred dollars, at the Oceana County Savings Bank, value received, with interest at the rate of 6 per cent. Judgment for plaintiff. Defendant brings error on the ground that the court erred in admitting in evidence the note in question for the reason (a) that the note is payable to Margaret A. Bitzer, and has never been indorsed or transferred by her to plaintiff; (b) that said note is not competent evidence, for the reason that plaintiff has not shown that he owns or has property in said note. LONG, J., [after disposing of another matter]. The note is plainly payable to bearer, and suit could be maintained thereon in the name of any holder. Judgment affirmed.2 § 60 COCK v. FELLOWS. 1 JOHNSON (N. Y.) 143. - 1806. FROM the return to the certiorari in this cause, it appeared that an action had been brought by the defendant in error against the present plaintiff, before a justice of the peace, in which he declared on a writing or note, in the following words: Due the bearer hereof, 31, 18s, 10d, which I promise to pay to Abraham Thompson, or order, on demand, as witness my hand, this 22d, 11th month, 1803. [Signed] JORDAN COCK. The note was not endorsed by Thompson, and the declaration stated the note was made payable to the bearer. The justice gave judgment for the plaintiff below, for the amount of the note. PER CURIAM. The word bearer has reference to Thompson as the 2 Accord: Grant v. Vaughan, 3 Burr. 1516; Pierce v. Crafts, 12 Johns. (N. Y.) 90; Ellis v. Wheeler, 3 Pick. (Mass.) 18; Matthews v. Hall, 1 Vt. 316. In Illinois promissory notes payable "to A. or bearer" require indorsement, though not if payable "to bearer." Roosa v. Crist, 17 Ill. 450; Garfield v. Berry, 5 Ill. App. 355; cf. A very v. Latimer, 14 Oh. 542. For meaning of "instruments payable to bearer," see § 28, ante. As to effect of special indorsement see Johnson v. Mitchell, 50 Tex. 212, post.-H. payee, and as the promise is expressly to pay him or order, another person could not maintain an action on the note without his endorsement. The judgment below must be reversed. Judgment reversed. $60 2. TRANSFER BY INDORSEMENT AND Delivery. (a) Transfer by indorsing assignment. MARKEY v. COREY. 108 MICHIGAN, 184. 1895.3 ACTION against Corey as indorser. The indorsement read: "I hereby assign the within note to Matthew M. Markey and Catherine Sundars." The note also referred to a certain contract which provided that in case of default in any one of five notes (of which the note in suit was one), all of the notes, at the option of the payee, might be declared due and payable. Judgment for plaintiff. LONG, J., [after stating the facts]. The usual mode of transfer of a promissory note is by simply writing the indorser's name upon the back, or by writing also over it the direction to pay the indorsee named, or order, or to him or bearer. An indorsement, however, may be made in more enlarged terms, and the indorser be held liable as such. In Sands v. Wood (1 Iowa, 263), the indorsement was, "I assign the within note to Mrs. Sarah Coffin." In Sears v. Lantz (47 Iowa, 658), the indorsement on the note was, "I hereby assign all my right and title to Louis Meckley." And in each case the party so assigning was held as indorser, the court in the latter case saying of Sands v. Wood: "He used no words that, in and of themselves, indicated that he had bound or made himself liable in case the maker, after demand, failed to pay the note. But it was held the law, as a legal conclusion, attached to the words used the liability that follows the indorsement of a promissory note." (See, also, Duffy's Adm'r v. O'Connor 7 Baxt. 498; Selby v. Judd, 24 Kan. 166; Brotherton v. Street [Ind. Sup.], 24 N. E. 1068.) The rule of the American cases is well stated in Daniel on Neg. Inst., (§ 688c), as follows: "The question arising in such cases, is a nice one, and depends upon rules of legal interpretation. The mere signature of the payee, indorsed on the paper, imports an executed contract of assignment, with its implications, and also an executory contract of conditional liability, with its Reported in 36 L. R. A. 117, with note entitled "Assignor of promissory note as an indorser."— C. 5 implications. The assignment would be as complete by the mere signature as with the words of assignment written over it. The conditional liability which is executory is implied by the executed contract of assignment, and the signature under it, which carried the legal title; and the question is, does the writing over a signature an express assignment, which the law imports from the signature per se, exclude and negative the idea of conditional liability, which the law also imports if such assignment were not expressed in full? We think not. When the thing done creates an implication of another to be done, we cannot think that the mere expression of the former in full can be regarded as excluding its consequence, when that consequence would follow if the expression were omitted." The language used in the assignment to the note in suit does not negative the implication of the legal liability of the assignor as indorser, and as the words are to be construed, as strongly as their sense will allow, against the assignor, he must be held as indorser. This rule is fully supported in Hatch v. Barrett (34 Kan. 230; 8 Pac. 129). (See, also, Adams v. Blethen, 66 Me. 19.) In the case of Aniba v. Yeomans (39 Mich. 171), the assignment read as follows: "I hereby transfer my right, title, and interest of the within note to S. A. Yeomans." Mr. Justice Marston said in that case: "The right or interest passing, therefore, under the usual and customary indorsement, is much greater than the mere right, title, and interest of the payee; and when the transfer, as made, only attempts to pass the title and interest of the payee of the note, no greater right or interest than he then held can pass." In other words, the learned justice seemed to think that the words used limited the transfer to the right and title he then held. While this holding appears to be at variance with the cases elsewhere, we think it readily distinguishable from the present, as here the words are, "I hereby assign the within note to Matthew M. Markey and Catherine Sundars" and do not purport to limit the liability of Corey as an indorser. In Stevens v. Hannan (86 Mich. 307), the note sued upon was negotiable in form, and made payable to Batchelder, and he assigned it before maturity, as follows: "For value received, 1 hereby assign all interest in and to this note to Ralph E. Watson." Defendant insisted in that case that the plaintiff could not sue in his own name, but should have sued in the name of the payee. It was said by Mr. Justice McGrath: "I do not think the point well taken. If Batchelder's indorsement did not affect its negotiability, then Watson's indorsement entitled the plaintiff, as holder of the note, to sue in his own name." It must be held, therefore, that the memorandum on the note did not relieve Corey from his liability as indorser. The court was not in error in admitting the contract in evidence, See Neg. Inst. L., § 116, post. — H. as its purpose was to show that the note was not in fact limited by its provisions, and those provisions of the contract cited did not destroy the negotiability of the note. (Daniel, Neg. Inst., § 48.) The judgment must be affirmed. The other justices concurred." § 60 HALL v. TOBY, 110 Pennsylvania State, 318.1885. Action by D. B. Toby as indorsee under the following instrument and assignment: $551.50. WARREN, Aug. 18, 1879. For value received I promise to pay Wm. Toby, or order, five hundred and fifty-one 50/100 dollars with interest. ORRIS HALL. [On the back of this paper was the following transfer or assignment]: For value received I hereby assign, transfer and set over to D. B. Toby all my right, title, interest and claim in the within note. TIONESTA, Nov. 21, 1881. WM. TOBY, PER CURIAM. This note was negotiable. It contained an absolute and unconditional promise to pay to Wm. Toby or order the sum specified. As no time of payment was therein expressed, the law adjudges the money to be payable immediately. A right of action accrued at once and would be barred by the Statute of Limitations at the expiration of six years thereafter. The note had all the essential language to constitute a promissory note. The legal right of action thereon would have passed by indorsement and delivery. For purpose of transfer the assignment on the back of this note passed the legal title." 8 60 (b) Transfer by indorsing guaranty. TRUST COMPANY v. NATIONAL BANK. The note with security was Cook County National Bank BILL to compel surrender of note. given by the Wyandotte Bank to the to obtain credit, and not to be negotiated. The latter did negotiate it to the Trust Company. At its maturity there was due on it to the • Accord: Maine Trust, etc., Co. v. Butler, 45 Minn. 506; Davidson v. Powell, 114 N. C. 575; Merrill v. Hurley, 6 So. Dak. 592. Contra: Lyons v. Divelbis, 22 Pa. St. 185; Spencer v. Halpern, 62 Ark. 595; Cf. Aniba v. Yeomans, 39 Mich. 171.-H. 7 Cf. Aniba v. Yeomans, 39 Mich. 171. While the indorsement passes title it does not make the "assignor " liable as an indorser. Lyons v. Divelbis, 22 Pa. St. 185. Contra: Henderson v. Ackelmire, 59 Ind. 540; Adams v. Blethen, 66 Me. 19. H. |