75 76 cases both for and against the negotiability of such instru ments. Indiana.-Stoneman v. Pyle, 35 Ind. 103, 9 Am. Rep. 637; Hubbard v. Harriman, 38 Ind. 323; Proctor v. Baldwin, 82 Ind. 370. Illinois.- Dorsey v. Wolff, 142 Ill. 589, 32 N. E. 495, 34 Am. St. Rep. 99, 18 L. R. A. 428; Nickerson v. Sheldon, 33 Ill. 372, 85 Am. Dec. 280. Iowa. Shenandoah Nat. Bank v. Marsh, 89 Iowa, 273, 56 N. W. 458, 48 Am. St. Rep. 381; Sperry v. Hove, 32 Iowa, 184. Kansas.- Gilmore v. Hirst, 56 Kan. 626, 44 Pac. 603; Seaton v. Scovill, 18 Kan. 433, 26 Am. Rep. 779. while the latter confessedly do not. Stoneman v. Pyle, 35 Ind. 103, 9 Am. Rep. 637; Gaar v. Louisville Banking Co., 11 Bush (Ky.), 180, 21 Am. Rep. 209. The Pennsylvania court has said that a promissory note is a courier without luggage, traveling on the wings of the wind, and should not be lumbered up with provisions of the class under consideration. Another high authority has declared that a stipulation for attorney's fees is not luggage, but ballast,' and does not clog the circulation of the paper, but facilitates its progress. To further pursue the metaphor, it were, we think, more apt to say that the stipulation is neither luggage or ballast, and neither impedes or facilitates the flight of the paper through the transactions of commerce, since all persons are presumed to deal with it upon the assumption that it will be paid at maturity; but Montana.- Commerce Bank v. Fuis for the well-being of the cour- qua, 11 Mont. 285, 28 Pac. 291, 14 ier,' when its monetary functions have L. R. A. 588; this case was held to be been fully discharged, and its journey modified by sections 3991-3997 of the as a circulating medium has been Civil Code, and that under such statbrought to an end by default in pay- utes a note containing a stipulation ment at maturity." 75. Negotiability. The following cases are cited as being in favor of the negotiability of instruments containing the stipulation referred to in the text: United States.- Wilson Sewing Machine Co. v. Moreno, 7 Fed. 806; Howenstein v. Barnes, Fed. Cas. No. 6,786, 5 Dill. 482; Bank of British North America v. Ellis, 2 Fed. 44; Adams v. Addington, 16 Fed. 89; Schlesinger v. Arline, 31 Fed. 648; Farmers' Nat. Bank v. Sutton Mfg. Co., 52 Fed. 191, 3 C. C. A. 1, 6 U. S. App. 312, 17 L. R. A. 595. Alabama. First Nat. Bank v. Slaughter, 98 Ala. 602, 14 South. 545, 39 Am. St. Rep. 88. Arkansas. Overton v. Matthews, 35 Ark. 146; Trader v. Chidester, 41 Ark. 242, 48 Am. Rep. 38. Colorado.- Cowing v. Cloud (Ct. of App.), 65 Pac. 417. Georgia. Stapleton v. Louisville Banking Co., 95 Ga. 802, 23 S. E. 81; Jones v. Crawford, 107 Ga. 318, 33 S. E. 51, 45 L. R. A. 105. Kentucky.-Gaar v. Louisville Banking Co., 11 Bush, 180, 21 Am. Rep. 209. Louisiana.- Dietrich v. Bayhi, 23 La. Ann. 767. Mississippi.- Clifton V. Bank of Aberdeen, 75 Miss. 929, 23 South. 394. for the payment of attorney's fees is Nebraska.- Stark v. Olsen, 44 Neb. Oregon. Bean v. Kutschan, 24 Ore. 28, 32 Pac. 763. South Dakota.- National Bank of Commerce v. Feeney, 9 S. D. 550, 70 N. W. 874; Chandler v. Kennedy, 8 S. D. 56, 65 N. W. 439. Tennessee.-Oppenheimer v. Farmers & Merchants' Bank, 97 Tenn. 19, 36 S. W. 705. Texas. Hamilton Gin & Mill Co. v. Sinker, 74 Tex. 51, 11 S. W. 1056. Washington.- Second Nat. Bank v. Anglin, 6 Wash. 403, 33 Pac. 1056. 76. Nonnegotiability. The following cases are cited as being in favor of the nonnegotiability of instruments containing such stipulation: 39. Time of payment. a. In general.— An instrument to be negotiable must be payable on demand, or at a fixed or determinable future time." It is so universally the custom in commercial transactions to particularly specify the day of payment that cases involving an application of this rule are not often under consideration. There are many mercantile customs which have modified the extent and manner of construing and applying this rule. The rule in its original form required certainty as to time of payment; but under the forms adopted by commercial usage, and by the operation of the rule that what can be made certain is certain, bills and notes payable on demand, at sight, or upon presentment, are deemed at once certainly due when demand is made, although no one can say with certainty when that time will be.78 But the failure to state the time when an instrument is payable can only affect its character v. Kennedy, 8 S. Dak. 56, 65 N. W. 439. California. Findlay v. Potts, 131 Cal. 385, 63 Pac. 694; Adams v. Seaman, 82 Cal. 636, 23 Pac. 53, 7 L. R. A. 224; Meyer v. Weber, 133 Cal. 681, 65 Pac. 1110. Maine.- Roads v. Webb, 91 Me. 406, Bank, 78 Wis. 113, 47 N. W. 368; 40 Atl. 128. Maryland.- Maryland Fertilizing & Mfg. Co. v. Newman, 60 Md. 584, 45 Am. Rep. 750. Michigan.-Altman v. Rittershofer, 68 Mich. 287, 36 N. W. 74, 13 Am. St. Rep. 341; Cayuga County Nat. Bank v. Purdy, 56 Mich. 6, 22 N. W. 93. Minnesota.- Jones v. Radatz, 27 Minn. 240, 6 N. W. 800. Missouri.-Law v. Crawford, 67 Mo. App. 150; First Nat. Bank v. Gay, 71 Mo. 627; McCoy v. Green, 83 Mo. 626; Samstag v. Conley, 64 Mo. 476; Creasy v. Gray, 88 Mo. App. 454. North Carolina.- First Nat. Bank v. Bynum, 84 N. C. 24, 37 Am. Rep. 604. North Dakota.- First Nat. Bank v. Laughlin, 4 N. Dak. 391, 61 N. W. 473. Pennsylvania.- Johnston v. Speer, 92 Pa. St. 227, 34 Am. Rep. 675; Woods v. North, 84 Pa. St. 407, 24 Am. Rep. 201; Sweeney v. Thickstun, 77 Pa. St. 131. South Carolina.- Sylvester-Bleckley Co. v. Alewine, 48 S. C. 303, 26 S. E. 609. South Dakota.- Johnson v. Schar, 9 S. Dak. 536, 70 N. W. 874; Chandler Wisconsin.-First Nat. Bank v. Larsen, 60 Wis. 206, 19 N. W. 67, 50 Am. Rep. 365; Peterson v. Stoughton State Morgan v. Edwards, 53 Wis. 599, 11 77. Neg. Inst. Law (N. Y.), § 20. See Appendix. 78. Parsons on Notes and Bills, p. 38; Stillwell v. Craig, 58 Mo. 24, 30. Story on Promissory Notes (§ 29) says: "But there is a class of cases which, at first view, seem to import that payment is only to be made upon the occurrence of events which may never happen, and yet which are uniformly held to be absolutely payable at all events. Thus, if a note be made payable at sight, or at ten days after sight, or on ten days after notice, or on request, or on demand, in all these and the like cases the note will be held valid as a promissory note and payable at all events, although, in point of fact, the payee may die without ever having presented the note for sight, or without having given any notice to, or made any request or demand upon, the maker for payment. But the law, in all cases of this sort, deems the note to admit a present debt to be due to the payee, and payable absolutely and at all events, whenever or by whomsoever the note is presented for payment according to its purport." of negotiability; it will still exist as a valid and binding evidence of indebtedness as between the immediate parties thereto.79 b. Payment in installments. We have already seen that certainty as to the sum payable by a negotiable instrument is not affected by the fact that it is payable in installments.80 And the fact that an instrument specifies that it is payable at the call of the payee in installments does not change its character or destroy its negotiability.81 As for example, it has been held that a written promise to pay a certain sum of money to a railroad company, or order, in such installments and at such times as the directors of the company may, from time to time, assess or require, is a valid, negotiable promissory note, being, in fact, payable on demand, or in installments on demand.82 And where an instrument contained a promise to pay "seven dollars monthly in the following manner, to wit, seven dollars five days after date, and seven dollars on the first of each succeeding month for twelve months from date, for the privilege of advertising purposes," it was held to be a promissory note.88 c. Payable on demand; statutory provision.— The Negotiable Instruments Law contains the following: “An instrument is payable on demand: "1. Where it is expressed to be payable on demand, or at sight, 66 or on presentation; or "2. In which no time for payment is expressed. "Where an instrument is issued, accepted or indorsed when 79. Husbrook v. (Wis.) 643; Francis v. Castleman, 4 Bibb (Ky.), 282; Russell v. Whipple, 2 Cow. (N. Y.) 436; Mitchell v. Culver, 7 Cow. (N. Y.) 336. In the case of Brooks v. Hargreaves, 21 Mich. 254, it was in effect held that an obligation payable in money, the time of which cannot be made certain by any attainable means, is not a negotiable promissory note. Wilder, 1 Pin. thority the case of Goshen Turnpike Co. v. Hurtin, 9 Johns. (N. Y.) 217, and said: "The promise there was to pay the company $125 for five shares of the capital stock of the corpora tion, in such manner and proportion and at such time and place as the president, directors, and company should from time to time require. It was held that the note was a good promissory note within the statute, the statute there, relative to promissory notes, being the same in substance as that of 3 & 4 Anne; that the note was payable absolutely, and not depending on any contingency; that it was in effect payable on demand." See also Stillwell v. Craig. 58 Mo. 24; Wright v. Irwin, 33 Mich. 32. 80. See § 38 (d), ante, p. 199. 81. Van Buskirk v. Day, 32 Ill. 260. 82. White v. Smith, 77 Ill. 351, 20 Am. Rep. 251. In this case the note was in the following form: "For value received, I promise to pay to the Monticello Railroad Co., or order, the sum of fifty dollars, to be paid in such installments and at such times as the directors may from time to time assess or require.” The court cited as an au 83. Chase v. Behrman, 10 Daly (N. Y.), 344; Chase v. Senn, 13 N. Y. Supp. 266. overdue, it is, as regards the person so issuing, accepting or indorsing it, payable on demand." 84 The expressions "at sight" or on presentation" are synonymous with the expression" on demand." demand." It has been held in England that the expression" after sight," in a bill of exchange, means after acceptance or protest for nonacceptance, and not after a mere private exhibition to the drawee, because the "sight" must appear in a legal way. 85 But if a note is made payable "after sight," the expression merely imports that payment is not to be demanded until it has been again exhibited to the maker.86 d. Instruments expressing no time for payment.— An instrument in which no time for payment is specified is, according to all authorities, independent of the statute, payable forthwith.87 The 84. Neg. Inst. L. (N. Y.), § 26. be paid, there is nothing unjust nor For the same section in the statutes at variance with the real meaning of of other States see Appendix. The the contract in holding that the payee English Bills of Exchange Act, 1882 may thereupon demand payment, and (§ 10), contains a provision from if the note is not paid, proceed to which this section was probably de- collect it." rived. See Appendix. It was held that the words "when payor and payee mutually agree" are to be construed as meaning that it is payable on demand when and after the payor ought reasonably to have agreed. The court said: "The promise to pay is absolute. It is only the time of payment which is left to future agreement. Evidently it is expected from the tenor of the note that the parties will agree, and that the time, will be fixed and that the note will be paid. But no time is fixed within which the agreement is to be made. The law would, therefore, imply a reasonable time. Besides it is the payment, not the nonpayment, of the note for which the parties are providing. If the payor does not, within a reasonable time, agree when the note shall 85. Campbell v. French, 6 T. R. (Eng.) 212. It 86. Holmes v. Kerrison, 2 Taunt. (Eng.) 323; Sturdy v. Henderson, 4 B. & Ald. (Eng.) 592; Sutton V. Toomer, 7 B. & C. (Eng.) 416. has also been held in this country that the provision in the bill making five days after acceptance, and not five it payable five days after sight means days after presentment for acceptance. Mitchell v. De Grand, Fed. Cas. No. 9,661, 1 Mason, 176. 87. California.- Keyes v. Fenstermaker, 24 Cal. 329. Georgia.- Freeman v. Ross, 15 Ga. 252. Indiana.- Osborne V. Fulton, 3 Blackf. 233. Iowa.- Green v. Drebilbis, 1 G. Greene, 552. Kentucky.- Payne v. Mattox, 1 Bibb, 164; Kendal v. Talbott, 1 A. K. Marsh. 321. Louisiana.-Burthe v. Donaldson, 15 La. 382. Maine.- Shirley v. Todd, 9 Me. 83; Porter v. Porter, 51 Me. 376. Minnesota.- Mitchell v. Easton, 37 Minn. 335, 33 N. W. 910. Missouri.-St. Charles Bank v. Hunt, 25 Mo. App. 170. New York.-Wheeler v. Warner, 47 N. Y. 519, 7 Am. Rep. 478; Cornell v. Moulton, 3 Den. 12; Gaylord v. Van principle that an instrument which does not specify the time of payment is payable immediately, is not affected by a provision therein for payment of interest at a certain rate, after a certain event, and making the instrument due and collectible in case of a default in the payment of such interest.88 Certificates of deposit,89 checks,90 and due bills,91 when issued in the usual form, Loan, 15 Wend. 308; Herrick v. Bennett, 8 Johns. 374. Oregon.- Dodd v. Denny, 6 Ore. 157. Pennsylvania.- Messmore v. Morrison, 172 Pa. St. 300, 34 Atl. 450; Hall v. Toby, 110 Pa. St. 318, 1 Atl. 369. Texas.- Chambers v. Hill, 26 Tex. 472; Salinas v. Wright, 11 Tex. 572. Skeen, 61 Kan. 526, 60 Pac. 327, 78 Am. St. Rep. 337; Wilson v. Campbell, 110 Mich. 580, 68 N. W. 278; Hope v. Barker, 112 Mo. 338, 20 S. W. 567, 34 Am. St. Rep. 387; Jones v. Brown, 11 Ohio St. 601. 89. Mitchell v. Wilkins, 37 Minn. 335, 33 N. W. 910. 88. Instrument due on default of Certificates of deposit. In Massapayment of interest. In the case chusetts, however, a certificate of deof Roberts v. Snow, 27 Neb. 45, posit, not designating a time of pay43 N. W. 241, the instrument was ment, but payable on return of the in the following form: "For value certificate, was held not to be a promisreceived, I hereby promise to pay sory note payable on demand. Shute A. B., or order, $400, with 10 per v. Pacific Nat. Bank, 136 Mass. 487. cent interest per annum, payable The only conflict of authority in semi-annually in advance, in default of respect to such certificates is as to prompt payment of the interest for whether or not they are negotiable thirty days after it is due, then this promissory notes. The preponderance note, principal and interest, shall be of authority is in favor of the doctrine due and collectable, without defalca- that they are to be treated as promistion or discount, together with an at- sory notes. The following cases may torney fee of 10 per cent for collec- be cited as upholding this doctrine: tion, signed, B. L. S." The court Miller v. Austin, 54 U. S. 218, 14 L. said: "If it cannot be treated as a Ed. 119; Renfro v. M. & M. Bank, 83 promissory note, payable upon demand, Ala. 425, 3 South. 776; Brummagin then the only event which could occur v. Tallant, 29 Cal. 503, 89 Am. Dec. by which the note could be made to 61; Auten v. Crahan, 81 Ill. App. mature, according to its own language, 502; Kirkwood v. Bank, 40 Neb. 484, would be a default for thirty days in 58 N. W. 1016, 24 L. R. A. 444; Pardee the payment of the semi-annual inter- v. Fish, 60 N. Y. 265; Frank v. Wessels, est; and if such default should never 64 id. 155; Curran v. Witter, 68 Wis. be made the note would never mature, 16, 31 N. W. 705, 60 Am. Rep. 827. and, therefore, could never be collected The following cases support the docexcept by the voluntary payment of trine that such certificates of deposit, the maker. This evidently was not the unless otherwise specified, are payable intention of the parties to the instru- on demand: Tripp v. Curtenius, 36 ment." See also in this connection Mich. 494, 24 Am. Rep. 610; Beardsley Holmes v. West, 17 Cal. 623; Meador v. Webber, 104 Mich. 88, 62 N. W. 173; v. Dollar Sav. Bank, 56 Ga. 605; Hun- Hunt v. Devine, 37 Ill. 137; Lynch v. ter v. Clarke, 184 Ill. 158, 56 N. E. Goldsmith, 64 Ga. 42. 297; First Nat. Bank v. Price, 52 Iowa, 570, 3 N. W. 639; Clark v. 90. A check is always payable on presentation and demand. Morrison v. 91. Due bills. In the case of Sack- of Smith v. Allen, 5 Day (Conn.), 337, ett v. Spenser, 29 Barb. (N. Y.) 180, where the defendant stated in writing an instrument in the following form: that there was due to the plaintiff a "Due A. Y., or bearer, $340, for value certain sum, the instrument was held received, with interest, at Leicester's to import an express promise to pay office, in Rochester. Dated, October on demand. See also Lee v. Balcome, 4, 1851. (Signed) S. S.," was held to 9 Colo. 216, 11 Pac. 74; Huyck v. be payable immediately. In the case Meador, 24 Ark. 191. |