- (a) Church v. Stevens, 107 N. Y. Supp. 310. See section 36, which provides that "where the instrument is not dated, it will be considered to be dated as of the time it was issued." As between the immediate parties parol evidence is admissible to show the true date of a misdated note. Bigge v. Piper, 86 Tenn. 589.

(b) This was the general rule at common law. Daniel on Negotiable Instruments, § 108. But formerly in Connecticut a promissory note, not purporting on its face to be for value received did not import a consideration. Edgerton v. Edgerton, 8 Conn. 6; Bristol v. Warner, 19 Conn. 7.

(c) See sections 22, 54, 137.

(d) Prior to the statute the Court of Appeals of New York held that the commercial paper of a corporation did not lose the quality of negotiability by having attached thereto the corporate seal. Chase Nat. Bank o. Faurot, 149 N. Y. 532; Weeks v. Esler, 143 N. Y. 374. See also Mackay v. St. Mary's Church, 15 R. I. 121. The same rule had been applied to municipal bonds under seal. Bank of Rome v. Village of Rome, 19 N. Y. 20; Mercer County v. Hacket, 1 Wall. 83. And to the bonds of private corporations. Brainard v. N. Y. & H. R. R. Co., 25 N. Y. 496. So it was held that the negotiability of a United States treasury note was not restrained or affected by the fact that it was under the treasury seal. Dinsmore v. Duncan, 57 N. Y. 573. In Mercer County v. Hacket, supra, it was said by Justice Geier, speaking of bonds issued under seal: "But there is nothing immoral or contrary to good policy in making them negotiable if the necessities of commerce require that they should be so. A mere technical dogma of the courts or the common law cannot prohibit the commercial world from inventing or issuing any species of security not known in the last century." See also Mason v. Frick, 105 Pa. St. 162 and cases cited; Morris Canal, etc., Co. v. Fisher, 9 N. J. Eq. 699; National Exchange Bank v. Hartford P. & F. R. Co., 8 R. I. 375; Jackson v. Myers, 43 Md. 452; Muth v. Dolfield, 43 Md. 466. Contra, Osborne v. Hubbard, 20 Oregon 318. The rule adopted in the act existed by statute in the following States: Colorado, Florida, Georgia, Illinois, Kansas, Massachusetts, Nebraska, North Carolina, Ohio, and Tennessee.

(e) Thus, a note payable in gold coin is negotiable. Chrysler v. Griswold, 43 N. Y. 209. So is a note payable "in bank notes current in the city of New York." Keith v. Jones, 9 Johns. 120.

A note payable "in New York State bills or specie." Judah v. Harris, 19 Johns. 144. And à note payable "in current Florida funds." Williams v. Moseley, 2 Fla. 304. But see Wright v. Hart's Admr., 44 Pa. St. 454, where it was held that a note payable "in current funds at Pittsburgh" was not negotiable. See also Ford v. Mitchell, 15 Wis. 304; Platt v. The Sauk County Bank, 17 Wis. 222; Lindsey v. McClelland, 18 Wis. 481; Klauber v. Biggerstoff, 47 Wis. 551.

(f) In a number of the States it is required that notes given in payment of patent rights shall have written on the face thereof "given for a patent right." So, there are statutes requiring that what are known as Bohemian oats" notes shall state the nature of the consideration for which they were given. And so, there are statutes which require this in the case of notes given in payment for lightning rods or stallions, or notes given to "peddlers." The above provision is intended to prevent any repeal of such statutes. The New York statutes on the subject have been incorporated into the act. See sections 330, 331.

§ 26. When payable on demand.—An instrument is payable on demand:

1. Where it is expressed to be payable on demand, or at sight (a), or on presentation; or

2. In which no time for payment is expressed (b).

Where an instrument is issued, accepted or indorsed when overdue, it is, as regards the person so issuing, accepting or indorsing it, payable on demand (c).

(a) By the law merchant there are some distinctions between instruments payable on demand and those payable at sight; as, for example, in the matter of days of grace. See Daniel on Negotiable Instruments, §§ 617-619, and authorities there cited. This was also the effect of former statutes in some of the States. Walsh v. Dart, 12 Wis. 635. The new statute abolishes all these distinctions.

(b) Messmore v. Morrison, 172 Pa. St. 300; Hall v. Toby, 110 Pa. St. 318; James v. Brown, 11 Ohio St. 601; Holmes v. West, 17 Cal. 623; Porter v. Porter, 51 Me. 376; Keyes v. Feustomaher, 24 Cal. 329; Bank v. Price, 52 Iowa 530; Libby v. Mekelborg, 28

Minn. 38; Roberts v. Snow, 28 Neb. 425; Bacon v. Page, 1 Conn. 405; Raymond v. Sellick, 10 Conn. 485; Dodd v. Denny, 6 Oregon 156. And the legal intendment that the instrument is payable on demand cannot be changed by parol proof. Roberts v. Snow, 28 Neb. 425; Thompson v. Ketcham, 8 Johns. 146; Sheldon v. Heaton, 88 Hun, 535; Gaylord v. Van Loan, 15 Wend. 308; McLeod v. Hunter, 29 Misc. N. Y. 558 (a case arising under the statute); Koehning v. Muemminghoff, 61 Mo. 403; Self v. King, 28 Tex. 552. The words " on demand" may be added without avoiding the instrument. Byles on Bills, 210.

(c) Berry v. Robinson, 9 Johns. 121; Leavitt v. Putnam, 1 Sandf. 199; Bassonhorst v. Wilby, 45 Ohio St. 336; Light v. Kingsbury, 50 Mo. 331; Smith v. Caro, 9 Oregon 280; Bemis v. McKenzie, 13 Fla. 553. It is commonly said that the indorsement of a bill or note which is overdue is equivalent to drawing a new instrument payable at sight. Bishop v. Dexter, 2 Conn. 419; Mudd v. Harper, 1 Md. 110. In such cases presentment for payment must be made and notice of dishonor given, as in other instances of instruments payable on demand. Berry v. Robinson, 9 Johns. 121; Van Hoosen v. Van Alstyne, 9 Wend. 79; Poole v. Tolleson, 1 McCord, 200; Patterson v. Todd, 18 Pa. St. 420; Rosson v. Carroll, 90 Tenn. 90; Brown v. Hull, 33 Gratt. 23. Where a note, negotiated before due, is further negotiated after it has been dishonored, the holder takes the legal title, and can maintain a suit upon it in his own name, in the same manner as if he had received it before it was due. French v. Jarvis, 29 Conn. 353.

§ 27. When payable to order. The instrument is payable to order where it is drawn payable to the order of a specified person or to him or his order (a). It may be drawn payable to the order of:

1. A payee who is not maker, drawer or drawee; or

2. The drawer or maker (b); or

3. The drawee; or

4. Two or more payees jointly; or

5. One or some of several payees (c); or

6. The holder of an office for the time being (d).

Where the instrument is payable to order the payee must be named or otherwise indicated therein with reasonable certainty (e).

(a) By the rules of the law merchant an instrument payable to a specified person without the addition of the word "order," or other word of similar import, was not negotiable. Byles on Bills, p. 83; Smith v. Kendall, 6 T. R. 123; Maule v. Crawford, 14 Hun, 193; Carnwright v. Gray, 127 N. Y. 92. The English Bills of Exchange Act provides that "a bill is payable to order which is expressed to be so payable, or which is expressed to be payable to a particular person, and does not contain words prohibiting transfer or indicating an intention that it should not be transferable." But this change in the law was not deemed advantageous, and was not adopted.

(b) A note payable to the order of the maker is not complete until indorsed by him. Section 320.

(c) Illustration: A draft payable to A, B, and C, or either of them, or any two of them.

(d) For example, a note payable to three persons as trustees of an incorporated association, or their successors in office, is negotiable. Davis v. Gore, 6 N. Y. 124.

(e) The payee need not be designated by name. If his identity can be ascertained with certainty, it is sufficient. United States v. White, 2 Hill, 59; Blackman v. Lehman, 63 Ala. 547.

§ 28. When payable to bearer. The instrument is payable to bearer:

1. When it is expressed to be so payable; or

2. When it is payable to a person named therein or bearer (a); or

3. When it is payable to the order of a fictitious or nonexisting person, and such fact was known to the person making it so payable (b); or

4. When the name of the payee does not purport to be the name of any person (c); or

5. When the only or last indorsement is an indorsement in blank (d).

(a) Illustration: Instrument payable to "A. B., or bearer." In such case it is negotiable by delivery, and the indorsement of A. B. is not necessary to pass the title therein. See section 60.

(b) It is essential that the fictitious character of the payee should be known to the person making the instrument so payable. As said by the Court of Appeals of New York, in Shipman v. Bank of the State of New York, 126 N. Y. 318, 66 The maker's intention is the controlling consideration which determines the character of such paper. It cannot be treated as payable to bearer unless the maker knows the payee to be fictitious, and actually intends to make the paper payable to a fictitious person." Hence, if the maker or drawer supposes the payee to be an actually existing person (as, for instance, where he is induced by fraud to draw the instrument to the order of a fictitious person whom he supposes to exist), the instrument will not be payable to bearer, and no person can acquire the title thereto by delivery. And where the instrument is drawn, payable at a bank, the bank cannot charge the same to the account of its customer, since the instrument is not in such case payable to bearer, and the indorsement is a forgery. Shipman v. Bank of the State of New York, supra; Armstrong v. Bank, 46 Ohio St. 412; Bank of England v. Vagliano [1891], App. Cas. 107. But see Clutton v. Attenborough [1895], 2 Q. B. 707. It has been held that a note made payable to the order of the estate of a deceased person is a promissory note with a fictitious payee, and that where it has been negotiated by the maker it is deemed as against him to be a note payable to bearer. Lewisohn v. The Kent & Stanley Co., 87 Hun, 257. But the correctness of this view seems very questionable. The ground of the rule is that, as the fictitious payce cannot indorse the instrument, the drawer or maker must have intended that it should be payable to bearer. But no such intention can properly be ascribed where the instrument is drawn payable to the order of an estate; for the obvious intention is that it shall be paid upon the order of the decedent's legal representatives, and that they shall indorse the paper. Checks are frequently drawn in this way, and it appears to be the understanding of the business community that they require the indorsement of the executor or administrator.