always paid the discount, the defendant is entitled to a ruling that the paper is an accommodation paper within the terms of the Negotiable Instruments Law, and it is error to submit that question to the jury. Nat. Bank of Newport v. Snyder Manufacturing Co., 117 App. Div. 370. An indorsement by a partner of his separate accommodation note with the name of his firm is a sufficient indication of the nature of the transaction to make it the duty of the bank which discounts it to inquire into his authority to use the firm name for the occasion, unless there are circumstances from which the authority can be implied. Tanner v. Hall, 1 Pa. St. 417. The statute does not change the rule that an accommodation party has the right to determine for himself what use shall be made of the instrument which he signs. He may impose material or immaterial conditions and terms, and no person can enforce the instrument against him who takes it in violation of such terms and conditions and with notice thereof. Benjamin v. Rogers, 126 N. Y. 60. Thus, where the defendant indorsed a note upon the condition that it should not be negotiated in New York, assigning as a reason that he did not wish to be sued upon it in the State, it was held that, while the restriction did not seem to be material, yet the diversion was a defense to the indorser as against one who was not a holder for value. United States Nat. Bank v. Ewing, 131 N. Y. 506. But see Rogers v. Sipley, 35 N. J. Law, 86. ARTICLE IV. NEGOTIATION. Section 60. What constitutes negotiation. 62. Indorsement must be of entire instrument. 64. Special indorsement; indorsement in blank. dorsement. 66. When indorsement restrictive. 67. Effect of restrictive indorsement; rights of indorsee. 68. Qualified indorsement. 69. Conditional indorsement. 70. Indorsement of instrument payable to bearer. 71. Indorsement where payable to two or more persons. 72. Effect of instrument drawn or indorsed to a person as cashier. 73. Indorsement where name is misspelled, et cetera. 75. Time of indorsement; presumption. 78. Striking out indorsement. 79. Transfer without indorsement; effect of. § 60. What constitutes negotiation.—An instrument is negotiated when it is transferred from one person to another in such manner as to constitute the transferee the holder thereof. If payable to bearer (a) it is negotiated by de livery; if payable to order (b) it is negotiated by the indorsement (c) of the holder completed by delivery (d). (a) As to what instruments are payable to bearer, see section 28. (b) As to what instruments are payable to order, see section 27. (c) An indorsement is usually written on the back of the instrument, but the place is not essential. If the payee write his name on any part of the instrument, with the intention of indorsing it, that is a sufficient indorsement. Haines v. Dubois, 29 N. J. Law, 259. See section 36, subd. 6. (d) The indorsement alone without delivery conveys no title. Dann v. Norris, 24 Conn. 337; Clark v. Sigourney, 17 Conn. 520; Middleton v. Griffith, 57 N. J. Law, 442; Spencer v. Carstarphen, 15 Colo. 445. As between the original parties and others having notice, a conditional delivery, as well as want of consideration, may be shown; and parol evidence that the delivery was conditional, and of the terms of the condition, is not open to the objection of varying or contradicting the written contract. Higgins v. Ridgeway, 153 N. Y. 130; Persons v. Hawkins, 41 App. Div. (N. Y.) 171; Simmons v. Thompson, 29 App. Div. (N. Y.) 559; Hodge v. Smith, 130 Wis. 326; Ricketts v. Pendleton, 14 Md. 320; McFarland v. Sikes, 54 Conn. 250. But a parol agreement, although entered into at the time of making negotiable paper, that the payee will not negotiate it and will renew it, etc., is inadmissible to vary the effect of the paper. Heist v. Hart, 73 Pa. St. 286. So, it has been held that evidence of an oral agreement that payment was not to be called for until certain paintings of the maker had been sold is an attempt to vary the written contract. Wooley v. Cobb, 165 Mass. 503. See Woods Son Co. v. Schaefer, 173 Mass. 443. By former statutes in some States, notes made payable to a person named therein or bearer must have been indorsed to pass the legal title. Garvin v. Wiswell, 83 Ill. 218; Blackman v. Lehman, 63 Ala. 547. § 61. Indorsement; how made. The indorsement must be written on the instrument itself or upon a paper attached thereto (a). The signature of the indorser, without additional words, is a sufficient indorsement (b). (a) Crosby v. Roub, 16 Wis. 616; Folger v. Chase, 18 Pick. 63; French v. Turner, 15 Ind. 59. The rule as commonly stated is, that where there is not room on the bill, the indorsement may be on an allonge. But it is not necessary that there should be a physical impossibility of writing the indorsement on the instrument itself; it may be on an allonge, whenever the necessity or convenience of the parties requires it. See cases above cited. Besides, any such statement of the rule would give rise to a question of fact which might be determined variously. But see Bishop v. Chase, 156 Mo. 158; Franklin v. Twogood, Iowa, 515; Peach v. Bligh, 37 Ill. 317; Haskell v. Brown, 65 Ill. 29; Wall v. Hollenbeck, 19 Neb. 639. (b) This is the customary and mercantile form of indorsement. But an indorsement of a promissory note as follows: "For value received, I hereby assign, transfer and set over to B all my right, title, interest and claim in the within note," passes a legal title to the same and does not destroy its negotiability. Hall v. Toby, 110 Pa. St. 318; Thorp v. Mindeman, 123 Wis. 149. Where the name of the drawee is stamped on the back of a draft with a rubber stamp, by one having authority to do so and with intent to indorse it, it is a valid indorsement, but does not prove itself. Mayers v. McRimmon, 140 N. C. 640. And the transferee having possession under such an indorsement is deemed prima facie a holder in due course. Evans v. Freeman, 142 N. C. 61. § 62. Indorsement must be of entire instrument.- The indorsement must be an indorsement of the entire instrument. An indorsement, which purports to transfer to the indorsee a part only of the amount payable, or which purports to transfer the instrument to two or more indorsees severally, does not operate as a negotiation of the instrument (a). But where the instrument has been paid in part, it may be indorsed as to the residue (b). (a) For example, where a note for $500 was indorsed, "Pay to L four hundred dollars out of this note," it was held L could not recover from the maker. Lindsay v. Price, 33 Tex. 282. (b) The indorsement of a partial payment on the instrument does not render it non-negotiable. Smith v. Shippey, 182 Pa. St. 24. 63. Kinds of indorsement.-An indorsement may be either special or in blank; and it may also be either restrictive or qualified, or conditional. § 64. Special indorsement; indorsement in blank.-A special indorsement specifies the person to whom, or to whose order the instrument is to be payable; and the indorsement of such indorsee is necessary to the further negotiation of the instrument. An indorsement in blank specifies no indorsee, and an instrument so indorsed is payable to bearer, and may be negotiated by delivery (a). (a) See section 28. The legal effect of an indorsement in blank may not be varied by parol. Torbert v. Montague, 38 Colo. 325. § 65. Blank indorsement; how changed to special indorsement.— The holder may convert a blank indorsement into a special indorsement by writing over the signature of the indorser in blank any contract consistent with the character of the indorsement (a). (a) Beckwith v. Angell, 6 Conn. 317. Thus, he might write over it a special indorsement to himself or to some other person. But he could not write over it a contract of guaranty; for the effect of this would be to deprive the indorser of his right to notice in case of non-payment. Belden v. Hann, 61 Iowa 42. Such a contract would be inconsistent with the character of the indorsement. 66. When indorsement restrictive. An indorsement is restrictive, which either: 1. Prohibits the further negotiation of the instrument (a); or 2. Constitutes the indorsee the agent of the indorser (b); or |