Sayre authorizes them to be assigned by indorsement alone, and JANUARY 1830. not by delivery; they consequently cannot be assigned in any other mode than by indorsement, so as to authorize the assignee to sue in his own name. As illustrative of this position, see 2 Bibb 83. V. Lucas. But it has been contended that a bond or note under seal, payable to bearer, will pass by delivery in the same manner as a bank note payable to bearer. And in support of this proposition, the 3d of Kent's Commentaries is a Page 59. mainly relied on. And to support his doctrine, the learned commentator refers to 10th, Common Law Reports, page 16. That appears to have been the case of a Prussian bond, by which the king of Prussia declared "himself bound to every person who should for the time being be the holder of the bond." The Court determined that this bond was analogous to a bank note payable to bearer, and that the holder of it had power to give title to any person honestly acquiring it. But this decision was solely on the ground that the bond was payable directly to the holder, and also because it was proved at the trial that such bonds were negotiated like exchequer bills. To maintain the present action, much reliance has also been placed on the case of Bullard v. Bell, in which 1 Mason 252. Judge Story says, that "a note payable 'to bearer passes by mere delivery, and the holder claims merely as bearer; that the note is an original promise by the maker, to pay any person who shall become the bearer; and that a note payable to William Pitt or bearer, is a direct promise to the bearer, whether William Pitt be a real or fictitious person." To such authority as Judge Story, I bow with respectful submission; yet great men may err: Homer, the prince of poets, did sometimes nod, and Judge Story, who is generally correct, may in this instance have extended the doctrine too far. I admit that the analogy is strong, though it is not a case precisely in point. case before that eminent lawyer was that of a bank note not under seal; and if it had been a writing obligatory or note under seal, I have very little doubt but his opinion would have been different, as the subject matter varied before him. The Can it with any sort of plausibility be insisted, that a bill single or writing obligatory, the most essential and distinguishing qualities of which are scaling and delivery, possesses in this respect the same negotiable qualities, and is governed by the same rules as bank notes, which Sayre V. Lucas. JANUARY 1830. pass current in the commercial world, and answer all the purposes of cash? Surely not. Sealing and delivery are not of the essence of a bank note; if you attach these properties to it, its very name and nature become changed, and it is governed by other rules. If the bond is payable to William Pitt, or bearer, we cannot presume that William Pitt is a fictitious person in an instrument which requires the solemnities of signing, sealing, and delivery, to give it validity. If William Pitt was indeed a person not in being, it would be proper to aver the fact in the declaration, before the plaintiff, as holder of the bond, would be entitled to recover. It is said, that a writing under seal supposes an obligor, an obligee, and thing contracted for. In the case before us, who was the obligee? I answer Battelle and Wilkinson. The delivery also, which was an essential part of the transaction, was to them. How then, could there afterwards be another delivery to a subsequent holder by the same obligor? When Lucas sealed and delivered the instrument to Battelle and Wilkinson, that was a completion of the contract, and he could not become bound to any other person by a subsequent act of the obligee. There was no privity of contract between Lucas and the plaintiff; and though the instrument is payable to Battelle and Wilkinson, or bearer, this only authorized the bearer to sue in the name of Battelle and Wilkinson, and recover to his own use. A majority of the Court are for affirming the judgment. By JUDGE TAYLOR. The single question in the case is, whether a bill single, given to A. B. or bearer, can be sued on in the name of the bearer, without having been assigned to him by A. B. It has been contended this cannot be done for several reasons: 1. Because such instruments are not negotiable, and this would give them a negotiable character. 2. Because the legal interest is vested in the payee, and it requires an assignment from the payee to the holder, to pass it out of him. 3. Because the Statute passed in December, 1812, "concerning the assignment of bonds, notes, &c." requires that such an instrument shall be assigned, to enable the holder to sue in his own name. I do not consider it necessary to deny the first position, in order to maintain the doctrine that such an action may 1 252. Sayre V. Lucas. be sustained. Negotiable instruments payable to bearer, do JANUARY 1830. not pass by delivery, so as to vest the holder with a legal interest in them because they are negotiable, nor are they viewed as having been negotiated by the payee; but it is because the promise or undertaking is considered as having been originally made to the holder. Judge Story, al Mason in the case of Bullard v. Bella says, "a note payable to bearer is often said to be assignable by delivery, but in correct language there is no assignment in the case. It passes by mere delivery, and the holder never takes any title by or through any assignment, but claims merely as bearer. The note is an original promise by the maker, to pay any person who may become the bearer of it; it is therefore payable to any and every person who successively holds the note bona fide, not by virtue of any assignment of the promise, but by an original or direct promise, moving from the maker to the bearer." And this doctrine was essential to support the decision made in that case; it was the very point on which the action turned. If the note had been considered as passing from the payee by assignment, the decision must have been different from what it was, because it would then have been necessary, under the act of Congress on that subject, for the proceedings to have shewn that Pitt, the payee, was not a citizen of the same State with the defendant; and the decision was directly the contrary. This opinion of Judge Story, it was stated in the argument, has been supported by the Supreme Court of the United States, in a case reported in 2d Peters, which book is not here. And I do not see how a different result could be arrived at; all the authorities which I have consulted, maintain the same position. Chitty on Bills, page 64, has this strong language: "A bill may be drawn payable to bearer, and in such case it will be transferable by delivery; and a bill or note payble to J. S. or bearer, is in legal effect payable to the bearer, and J. S. is a mere cypher. I consider it clear, under these authorities, except for mere description, that it would be wholly immaterial whether the name of the payee appeared in the declaration or not, and that on a count which did not aver a delivery by the payee to the holder, the note could be given. in evidence. From these authorities and reasons, I arrive at the conclusion that an instrument payable to bearer is considered as executed to the holder; that whether this instru Sayre V. Lucas. a Page 16. JANUARY 1830. ment be a bond, note, or bill of exchange, there is no difference: that therefore the holder has the legal interest and may maintain an action in his own name. And in this opinion I consider myself directly sustained by the case of Gorgier v. Mieville, reported in 10th Sergeant and Lowber," which was an action by the owner to recover the amount of a bond executed by the King of Prussia, and made payable to the holder, which had been deposited with an agent for certain purposes, who had pledged it for a debt of his own. The Court instructed the jury to find a verdict for the defendants, unless they thought the defendants knew that the bond was not the property of the person who made the pledge. It is true, that in this case it was proved that bonds of this description were sold in the market and passed by delivery from hand to hand, like exchequer bills, and the Judge compared the bond to a negotiable instrument, because such instruments passed by delivery in ordinary dealings; and I think we may fairly presume that such is the case with paper like that on which this suit is founded, though I do not consider this material to the decision. It is clearly proved by the case last cited, that sealed instruments are not placed by the decisions on a different footing from promissory notes, so far as this question is involved. But it is insisted, that although a suit might be brought by the holder, if the bill were made payable simply to "bearer," yet when made payable to "A. B. or bearer," it cannot; that in the latter case it is evident the instrument was delivered to a different person from the one who sues, and that it would be contradicting it by a presumption, to infer that the obligation to pay was entered into with any other person. This is a distinction, so far as authorities have been adduced, and the researches of counsel seem to have been great, never before taken. The case decided by Judge Story was exactly similar to the present. payable to William Pitt or bearer; and such a distinction is exeluded by the language of Chitty before quoted, when The note was he says the payee will be considered "a mere cypher." I think true policy, if the law will admit it without great violence, requires at our hands the same decision in this case, which we would make were the action founded on a promissory note. By our statutes they are placed in almost every instance, and for every purpose, on the same footing; they are the kind of instruments most Sayre V. Lucas. usually executed among us, and we probably see ten of JANUARY 1830. them, for one promissory note. But what law have we which permits promissory notes to be passed in this way, if bills single cannot? The former are no more negotiable with us, than the latter. All equitable defences can be made by the maker of the one as well as the other, when transferred to a third person; and yet I understand that while bills single are to be thus restricted, a different rule is adopted with respect to promissory notes. According to Lord Holts opinion, and that of a majority of judges and lawyers of the present day, nothing but the statute of Ann gives to promissory notes negotiability; that statute has no place on our statute book, but our acts of Assembly treat bills single and promissory notes alike. That able jurist, Judge Kent, in the third volume of his commentaries, page 59, lays down the doctrine in the same way in which it is maintained by Judge Story, and adopted in this opinion. Having disposed of the two first positions taken by the defendants counsel together, I come now to examine the last: which is, that our statute prescribes "assignment" as the only mode by which an instrument of this kind can be transferred, so as to vest in the holder a right of action. This act declares, "that all bonds, obligations, bills single, promissory notes, &c. shall and may hereafter be assigned by indorsement, whether the same be made payable to the order or assigns of the obligee or payee, or not; and that the assignee shall and may sue in his own name, &c." It seems to me that a simple question might put down the objection raised on this statute at once. Was it a restraining or was it an enabling act? Certainly not the former. The object was to enlarge the powers of holders of these instruments, except so far as it repealed a previous statute, making promissory notes negotiable; and it is against all rule to construe a statute having this object, in a way which would give it a contrary effect. But the meaning of the words, "whether the same he made payable to the order or assigns of the obligee or payee or not," can very readily be perceived, and full effect given to them, without any such restraining construction. By the Law Merchant, bills and notes are not negotiable, unless the words "or order," be inserted in them; although a good bill or note, so far as the parties to it are affected; yet these words are essential to render it |