Fraud or negotiated in breach of faith,1 or in fraud of third duress. Illegal considera tion. Bills void by statute parties.2 Explanation 2.-The holder of a bill subsequent to a fraud, who is not a bona fide holder for value without notice, cannot enforce payment against any party thereto, neither can he retain the bill against the true owner.3 NOTE. When the consideration for a bill is clearly fraudulent, and it is in the hands of a party with notice, the Court will order it to be given up at once. When only a prima facie case of fraud is made out, the Court will restrain the negotiation of the bill for a specified time, in order that the question may be tried.5 Art. 95. Illegality of consideration, total or partial, is a defence against an immediate party or a remote party who is not a bond fide holder for value without notice." Explanation. The consideration for a bill is illegal when it is wholly or in part immoral, contrary to public policy, or forbidden under penalties by statute." NOTE. When old cases are referred to it is important to notice whether the consideration was simply illegal or whether it was a consideration which by statute expressly made the bill void. Again, an illegal consideration must be distinguished from a merely void consideration.8 In America it has been held that if B. for value make a note payable to C., and C. for an illegal consideration indorse it to D, then D. can sue B. though he could not sue C.9 Art. 96. When a bill is given for a consideration which by statute expressly makes it void, it is as against the party who gave it void in the hands of all parties whether immediate or remote 10 1 Lloyd v. Howard (1850), 15 Q. B. 995; Burber v. Richards (1851), 6 Exch. 63; Cf. Art. 55. 2 Jones v. Gordon (1877), 2 L. R. Ap. Ca. 616, H. L. 3 Id. Lloyd v. Howard, suprà; Alsager v. Close (1842), 10 M. & W. 576. 4 Joyce on Injunctions, p. 369; and see Jones v. Lane (1829), 3 Y. & C. at 293. 5 Id. ILLUSTRATION. A. draws a bill on B. payable to his own order. B. accepts it Bills void by statute. for a consideration which by statute avoids it. A. indorses it to C., who takes it for value and without notice. C. can sue A., but he cannot sue B.: NOTE.-Most if not all the statutes which expressly avoided bills are now repealed, e.g., the laws relating to usury and stock jobbing. By 5 & 6 Will. 4, c. 41, § 1, bills and notes given for wagers or gaming are not to be void, but are to be deemed to be given for an illegal consideration; and see 8 & 9 Vict. c. 109. In many American States usury laws still prevail. tion of Art. 97. The holder of a bill is prima facie deemed Presumpto be a bona fide holder for value without notice; 3 value and bona fides but if in an action on a bill it is admitted or there is may shift. evidence that the issue or subsequent negotiation of such bill is affected with fraud or illegality, the onus probandi as to value is shifted, and the holder is called upon to prove that he is a holder for value. 5 ILLUSTRATIONS. 1. A. draws a bill on B. and indorses it to C. C. sues B. It is shewn that B. accepted it for A.'s accommodation. C. is not called on to prove that he gave value, he can recover without so doing." 2. B. makes a note payable to C. C. indorses it to D., who sues B. If it appears that B. made the note for an illegal consideration, D. must prove that he gave value.' 3. The holder of a bill indorses it to D. to get it discounted. D. fraudulently negotiates it to E., who negotiates it to F. F. sues the acceptor. Evidence is given of D.'s fraud. F. must prove that he is a holder for value.8 4. B. makes a note payable to C., the consideration for which is a wager, i.e., a consideration void by statute, but not prohibited 1 Edwards v. Dick (1821), 4 B. & Ald. 212. 2 Id.; and Reed v. Wiggins (1862), 13 C. B. N. S. 220. 3 King v. Milsom (1809), 2 Camp. 6. 4 Hall v. Featherstone (1858), 3 H. & N. at 286 (evidence to go to a jury). 5 Jones v. Gordon (1877), 2 L. R. Ap. Ca. at 627, 628, H. L. 6 Mills v. Barber (1836), 1 M. & W. 425. 7 Bailey v. Bidwell (1844), 13 M. & W. 73. 8 Cf. Smith v. Braine (1851), 16 Q. B, 244; Berry v. Alderman (1853), 14 C. B. 95, G Presump under a penalty. C. indorses it to D., who sues B. Evidence is given of these facts. D. is not called on to prove that he gave value.1 tion of value and bona fides may shift. 5. Action against the maker of a note payable to bearer. It is shown to have been stolen from the true owner. It lies on the holder to prove that he gave value.* 6. An acceptance is given in renewal of a bill which turns out to be a forgery. The genuine bill is negotiated, and the holder sues the acceptor. Evidence is given of these facts. It lies on the holder to prove that he is a holder for value.3 7. A partner accepts a bill in the firm's name for a private debt and in fraud of his co-partners. The bill is negotiated. The holder sues the firm as acceptors. As soon as it appears that the bill was given for a private debt, the holder is called upon to prove that he is a holder for value.* NOTE. If the holder show that he is a holder for full value, it lies on the defendant to show that he took the bill with notice, for the presumption of bona fides is re-established; but what if the holder did not give full value? In America it is held that if the holder has in good faith given partial value, he may recover pro tanto. Probably the same would be held in England. 1 Fitch v. Jones (1855), 5 E. & B. 238. 2 Raphael v. Bank of England (1855), 17 C. B. 161. 3 Mather v. Maidstone (1856), C. B. N. S. 273. 4 Hogg v. Skeen (1865), 18 C. B. N. S. 426. 5 Raphael v. Bank of England (1855), 17 C. B. 161; but cf. Jones v. Gordon (1877), 2 L. R. Ap. Ca. at 628. 6 Holcomb v. Wyckoff (1870), 10 Amer. R. 219; Dresser v. Missouri Co. (1876), 3 Otto. 92, Sup. Ct. U. S. CHAPTER IV. TRANSFER. Transmission by Act of Law. Art. 98. If a bill be held by an unmarried woman Marriage. who subsequently marries, or if a bill be made payable to a married woman, the title thereto vests in the husband, provided he reduce it into possession.1 Explanation 1.-If the husband dies without having reduced the bill into possession the title thereto reverts to the wife if she be alive, and passes to her personal representatives if she dies before her husband.2 Explanation 2.-During the marriage, the husband is for all purposes deemed to be the holder of a bill payable to the order of his wife, whether it was made payable to her before or after the marriage.3 ILLUSTRATIONS. C. marries 1. Bill payable to the order of C., a single woman. D. C., after marriage, indorses the bill to E. without her husband's 1 Cf. Fleet v. Perrins (1868), 3 L. R. Q. B. at 511, affirmed 4 L. R. Q. B. 500. As to what is or is not a reduction of a bill into possession: Cf. Nash v. Nash (1817), 2 Mad. 133; Sherrington v. Yates (1844), 12 M. & W. 855, esp. at 865, Ex. Ch.; Hart v. Stephens (1845), 6 Q. B. 937; Scarpelini v. Atcheson (1845), 7 Q. B. at 875 -876; Latourette v. Williams (1847), 1 Barb. 9. New York. 2 Hart v. Stephens (1845), 6 Q. B. 937; Williams on Executors, 7th ed., 848-852. 3 Cf. McNeilage v. Holloway (1818), 1 B. & Ald. 218. pp. Marriage consent. The indorsement is invalid:1 but D. could validly indorse the bill, using his own name." Death. 2. A note is made payable to the order of C., a married woman. Her husband indorses it in his own name. This is a valid indorsement.3 NOTE. When a bill is made payable to the order of a married woman, the husband may sue on it in his own name alone, or if he likes he may join his wife. When a bill is payable to the order of a single woman, who subsequently marries, both husband and wife should join in an action on it; but it has once been held that the husband may sue alone.5 Exception.-Bill forming part of wife's separate estate. Art. 99. On the death of the holder of a bill the title thereto passes to his personal representatives, (executors or administrators, as the case may be)." ILLUSTRATIONS. 1. C., the holder of a bill payable to order, dies. His administrator can enforce payment of it or indorse it away, using his own name.s 2. C., the holder of a bill payable to order, dies, having specifically bequeathed it to X. X. cannot sue on it or indorse it away, unless he first obtain an indorsement of the bill to him by C.'s executor. NOTE. An executor or administrator who indorses a bill should, in express terms, exclude personal liability, cf. Art. 76; and as he is not the agent of the deceased he cannot by his delivery complete an indorsement written by the latter. He must indorse it de novo; Art. 54. When there are two or more executors, the indorsement of one is probably sufficient to transfer the property in the bill. 1 Connor v. Martin (1746), cited 3 Wils. at 5. 2 Roberts v. Place (1846), 18 New Hamp. R. 183. 3 Mason v. Morgan (1834), 4 N. & M. 46; Cf. Smith v. Marsack (1848), 6 C. B. 486 at 503. 4 Fleet v. Perrins (1868), 3 L. R. Q. B. at 541. McNeilage v. Holloway (1818), 1 B. & Ald. 218; but cf. Sherrington v. Yates (1844), 12 M. & W. at 865, Ex. Ch. • Green v. Carlill (1877), 4 L. R. Ch. D. 882, and Arts. 65, 66; Cf. Art. 81, Excep. 2, 7 Williams on Executors, 7th ed., 786. 8 Rawlinson v. Stone (1746), 3 Wils. 1 Ex. Ch, |