This statute does not provide what shall constitute a promissory note. The term "note" is used, as it was then and still is defined by the authorities, and well understood under the law merchant in the commercial world. Melton v. Gibson, 97 Ind. 158.

The sole purpose of the section was to put a limitation upon section 5503, and provide for commercial paper that might circulate free from defences in favor of the maker. This is accomplished by the provision, that if the note be payable at a bank in this State, it shall be negotiable as inland bills of exchange.

* * *

The note, then, with the addition prescribed by the statute, must be such as would have been negotiable under the law merchant without any statutory provision. Are the notes in suit such as would have been thus negotiable? A standard author has said: “To learn what qualities are essential to a negotiable promissory note, we must bear in mind the purpose of the note, and of the law in relation to it. This is simply that the note may represent money, and do all the work of money in business transactions. For this purpose, the first requisite, that, indeed, which includes all the rest, is certainty. This means certainty, Second, as to the person or persons who are to make this payment, and the order and conditions of their liability. * * Fourth, as to the time when payment is to be made. It will be seen that the law endeavors to enforce, define, and protect all these certainties as far as possible." I Parsons Notes and Bills, p. 30. See, also, I Daniel Neg. Inst., section 41. This same general doctrine of the books is recognized by this and all other courts. Walker v. Woollen, 54 Ind. 164 (23 Am. R. 639). In this case it was said: "A note, in order that it be negotiable in accordance with the law merchant, must be payable unconditionally and at all events, and at some fixed period of time, or upon some event which must inevitably happen."

*
*

*

Were it necessary, we might cite numerous decisions by this court asserting the general doctrine of certainty as necessary to a promissory note under the law merchant. The difficulty is not as to the general doctrine, but the application of it to each case as it arises.

In the case before us, all parts of the note must be looked to in determining the quality of the paper. There is a promise to pay in twelve months, but that promise is not certain and unconditional. The other clause is, that the time of payment may be extended indefinitely, as the parties may agree. From an inspection of the note, it is impossible to tell when it may mature,

because it is impossible to know what extension may have been, or may hereafter be, agreed upon. No definite time is fixed, nor is the maturity of the note dependent upon an event that must inevitably happen. The condition is not that something may happen, or be done, that will mature the note before the time named, thus leaving that time as fixed and certain, if the thing do not happen, or be not done; but the condition is that the time. named may be displaced by another, uncertain and indefinite time, as the parties may agree.

This distinguishes the case from some of the cases cited by appellee, which hold that so long as a definite time of payment, as fixed in the note, remains fixed and certain, the note retains its negotiability, although by certain agreed conditions it may be matured before that time. The case here is, also, distinguishable from another class of cases which hold that the time of payment may be dependent upon an event that must inevitably happen, such as the death of the maker, the coming of the seasons, etc. The precise question involved here has been passed upon by the Supreme Courts of Iowa and Michigan, and in each case it was held that the condition destroyed the negotiability of the note. Woodbury v. Roberts, 59 Iowa, 348 (44 Am. R. 685); Smith v. Van Blarcom, 45 Mich. 371. See, also, as in point, Cook v. Satterlee, 6 Cow. 108; Gillilan v. Myers, 31 Ill. 525; Costelo v. Crowell, 127 Mass. 293 (34 Am. R. 367).

We conclude from the foregoing that the notes in suit are not negotiable under the statute as inland bills of exchange, and that, therefore, whatever defences appellant might have set up and made available as against Nugen, the payee, he may set up and make available as against appellee. * * *

The judgment is reversed, with costs.

INSTRUMENT MAY BE PAYABLE ON OR BEFORE A FIXED TIME. § 6—2.

Mattison v. Marks (1875), 31 Mich. 421, 18 Am. Rep. 197.

Newton Foster, for plaintiff in error.

Richards & Barnum, for defendants in error.

COOLEY, J. The view of the circuit judge, that the evidence introduced on the part of the defendant tended to show the note in suit to have been paid by Almanson M. Mattison, appears to us untenable. This person, it appears, had a mortgage which cov

ered the same premises as the mortgage which secured the note in suit. His mortgage he had foreclosed, and had become the purchaser of the property, but to protect his title it was necessary that the prior mortgage should be taken care of. This he could only do by purchasing it, or paying it off; but whichever form the transaction assumed, he would be entitled to be subrogated to the rights of the former holder, and might enforce payment from the parties who were responsible therefor. There is no ground on which the maker and endorser of the note secured by the first mortgage can claim that the taking up of that note by a second mortgagee with whom they were in no way in privity, can operate to release them from their obligation to pay it. Whether the second mortgagee takes a formal assignment or not, such a transaction makes him in equity an assignee, and he is entitled to resort to all suitable remedies to enforce payment. Russell v. Howard, 2 McLean, 489; Downer v. Fox, 20 Vt. 388.

This view will dispose of the case, unless the defendant is correct in the position he takes, that the paper sued upon is not a promissory note. If it is not, the suit must fail, because the declaration has treated it as such, and is not adapted to the case of any other special contract. The objection to this instrument is, that it promises to pay a certain sum of money "on or before" a day named; and this, it is said, is not a promise to pay on a day certain, and consequently cannot be a promissory note. We are referred to Hubbard v. Mosely, 11 Gray, 170, in support of this view. That case certainly seems to support the position of defendant, and it is to be regretted, perhaps, that the learned judge who delivered the opinion did not deem it important to present more fully the reasons that led him to his conclusions, instead of contenting himself with a simple reference to the general doctrine that a promissory note must be payable at a time. certain. It seems to us that this note is payable at a time certain. It is payable certainly, and at all events, on a day particularly named; and at that time, and not before, payment might be enforced against the maker. It is impossible to say that this paper makes the payment subject to any contingency, or puts it upon any condition. The legal rights of the holder are clear and certain; the note is due at a time fixed, and it is not due before. True, the maker may pay sooner if he shall choose, but this option, if exercised, would be a payment in advance of the legal liability to pay, and nothing more. Notes like this are common in commercial transactions, and we are not aware that their negotiable quality is ever questioned in business dealings. It ought

not to be questioned for the sake of any distinction that does not rest upon sound reason, and we can discover no sound reason for the distinction here insisted upon.

The judgment must be reversed, with costs, and a new trial ordered.

GRAVES, Ch.J., and CAMPBELL, J., concurred.

MAY BE PAYABLE AFTER THE OCCURRENCE OF A SPECIFIED EVENT WHICH IS SURE TO HAPPEN, THOUGH THE TIME OF

HAPPENING BE UNCERTAIN.

Kelley v. Hemmingway (1852), 13 Ill. 604.

§ 6-3.

Farnsworth and Ferguson and T. L. Dickey, for appellant.
Glover & Cook, for appellee.

TREAT, C.J. This was an action brought by Hemmingway against Kelley before a justice of the peace, and taken by appeal to the Circuit Court. On the trial, in the latter court, the plaintiff offered in evidence an instrument in these words:

"CASTLETON, April 27th, 1844. "Due Henry D. Kelley fifty-three dollars when he is twenty

one years old, with interest.

DAVID KELLEY."

On the back of which was this indorsement.

"ROCKTON, May 21st, 1849.

"Signed the within, payable to Moses Hemmingway.

"HENRY KELLEY."

The plaintiff proved that the payee became of age in August, 1849. The defendant objected to the introduction of the instrument, because it was not negotiable, but the court admitted it in evidence, and rendered judgment for the plaintiff.

Our statute makes promissory notes assignable by indorsement in writing, so as absolutely to vest the legal interest in the assignee. Was the instrument in question a promissory note? To constitute a promissory note, the money must be certainly payable, not dependent on any contingency, either as to event, or the fund out of which payment is to be made, or the parties by or to whom payment is to be made. If the terms of an instrument leave it uncertain whether the money will ever become payable, it cannot be considered as a promissory note. Chitty on

Bills, 134. Thus, a promise in writing to pay a sum of money when a particular person shall be married, is not a promissory note, because it is not certain that he will ever be married. Pearson v. Ganet, 4 Mod. 242; Beardsley v. Baldwin, 2 Strange, 1151. So of a promise to pay when a particular ship shall return from sea, for it is not certain that she will ever return. Palmer v. Pratt, 2 Bing. 185; Coolidge v. Ruggles, 15 Mass. 387. In all such cases, the promise is to pay on a contingency that may never happen. But if the event on which the money is to become payable must inevitably take place, it is a matter of no importance how long the payment may be suspended. A promise to pay a sum of money on the death of a particular individual, is a good promissory note, for the event on which the payment is made to depend will certainly transpire. Colehan v. Cooke, Willes, 393; S. C. 2 Strange, 1217.

In this case, the payment was to be made when the payee should attain his majority-an event that might or might not take place. The contingency might never happen, and therefore the money was not certainly and at all events payable. The instrument lacked one of the essential ingredients of a promissory note, and consequently was not negotiable under the statute. The fact that the payee lived till he was twenty-one years of age makes no difference. It was not a promissory note when made, and it could not become such by matter ex post facto. The plaintiff has not the legal title to the instrument. If it presents a cause of action against the maker, the suit must be brought in the name of the payee. The case of Goss v. Nelson (1 Burr. 226), is clearly distinguishable from the present. There, the note was made payable to an infant when he should arrive at age, and the day when that was to be was specified. The court held the instrument to be a good promissory note, but expressly or the ground that the money was at all events payable on the day named, whether the payee should live till that time, or die in the interim; and it was distinctly intimated, that the case would be very different had the day not been stated in the note. It was regarded as an absolute promise to pay on the day specified, and no effect was given to the words that the payee would then become of age. The judgment must be reversed. Judgment reversed.