Letter of Credit.

A letter of credit is a written instrument, addressed by one person to another, requesting the latter to give credit to the person in whose favor it is drawn.

The writer of the letter of credit is, upon the default of the debtor, liable to those who gave credit in compliance with its

terms.

CHAPTER XXXVII.

SALE.

No sale of personal property, or agreement to buy or sell it, for a price of two hundred dollars or more, is valid, unless:

1. The agreement, or some note or memorandum thereof, be in writing, and subscribed by the party to be charged, or by his agent; or,

2. The buyer accepts and receives part of the thing sold, or when it consists of a thing in action, part of the evidences thereof, or some of them; or,

3. The buyer, at the time of the sale, pays a part of the price.

The foregoing provisions do not effect an agreement to manufacture a thing from materials furnished by the manufacturer or by another person.

No agreement for the sale of real property, or of an interest therein, is valid unless the same, or some note or memorandum thereof, be in writing, and subscribed by the party to be charged, or his agent thereunto authorized in writing.

If a buyer of personal property does not pay for it according to contract, and it remains in the possession of the seller after payment is due, the seller may rescind the sale, or enforce his lien for the price.

In order to make a sale of personal property effectual as against creditors, there must be an immediate, actual, and continued change of possession.

CHAPTER XXXVIII.

CONTRACTS.

A contract is an agreement to do or not to do a certain thing. It is essential to the existence of a contract that there should be:

4.

A sufficient cause of consideration.

A written instrument is presumptive evidence of consideration.

Contracts are either expressed or implied.

An express contract is one, the terms of which are stated in words.

An implied contract is one, the existence and terms of which are manifested by conduct.

The following contracts are invalid, unless the same, or some note or memorandum thereof, be in writing, and subscribed by the party to be charged, or by his agent.

1. An agreement that, by its terms, is not to be performed within a year from the making thereof.

2. A special promise to answer for the debts, default or miscarriage of another, except in the case mentioned in Chapter XXXVI.

3. An agreement made upon consideration of marriage other than a mutual promise to marry.

4. An agreement for the sale of goods, chattels, or things in action, at a price not less than two hundred dollars, unless the buyer accept or receive part of such goods and chattels, or the evidences, or some of them, of such things in action, or pay at the time some part of the purchase money; but when a sale is made by auction, an entry by the auctioneer in his sale book at the time of the sale, of the kind of property sold, the term

of sale, the price, and the names of the purchaser and person on whose account the sale is made, is a sufficient memorandum.

5. An agreement for the leasing for a longer period than one year, or for the sale of real property, or of an interest therein; and such agreement, if made by an agent of the party sought to be charged, is invalid, unless the authority of the agent be in writing, subscribed by the party sought to be charged.

6. An agreement authorizing or employing an agent or broker to purchase or sell real estate for compensation or a commission.

All contracts may be oral except such as are especially required by statute to be in writing.

CHAPTER XXXIX.

NEGOTIABLE INSTRUMENTS.

A bill of exchange is an instrument negotiable in form by which one, who is called the drawer, requests another, called the drawee, to pay a specified sum of money.

A bill of exchange is payable:

1. At the place where, by its terms, it is made payable; or, 2. If it specify no place of payment, then at the place to which it is addressed; or,

3. If it is not addressed to any place, then at the place of residence or business of the drawee, or wherever he may be found. If the drawee has no place of business, or if his place of business or residence cannot, with reasonable diligence, be ascertained, presentment for payment is excused, and the bill may be protested for non-payment.

Presentment of a bill of exchange for acceptance must be made in the following manner, as nearly as by reasonable diligence it is practicable:

1. The bill must be presented by the holder or his agent.

2. It must be presented on a business day, and within reasonable hours.

3. It must be presented to the drawee, or if he be absent. from his place of residence or business, to some person having charge thereof, or employed therein; and,

4. The drawee, on such presentment, may postpone his acceptance or refusal until the next day. If the drawee have no place of business, or if his place of business or residence cannot, with reasonable diligence, be ascertained, presentment for acceptance is excused, and the bill may be protested for nonacceptance.

When a bill of exchange is payable at a specified time after sight, the drawer and endorsers are exonerated if it is not presented for acceptance within ten days after the time which would suffice, with ordinary diligence, to forward it for acceptance, unless presentment is excused.

An acceptance of a bill must be made in writing, and may be made by the acceptor writing his name across the face of the bill, with or without other words.

An unconditional promise, in writing, to accept a bill of exchange, is a sufficient acceptance thereof, in favor of every person who, upon the faith thereof, has taken the bill for value or other good consideration.

On the dishonor of a bill of exchange by the drawee, and in case of a foreign bill, after it has been duly protested, it may be accepted or paid by any person for the honor of any party thereto.

If a bill of exchange, payable at sight or on demand, without interest, is not duly presented for payment within ten days after the time in which it could, with reasonable diligence, be transmitted to the proper place for presentment, the drawer and indorsers are exonerated unless such presentment is excused.

The presentment of a bill of exchange for acceptance is excused if the drawee has not capacity to accept it.

Delay in the presentment of a bill of exchange for acceptance is excused when caused by circumstances over which the owner has no control.

Presentment of a bill of exchange for acceptance or payment, and notice of its dishonor, are excused as to the drawer, if he forbids the drawee to accept, or the acceptor to pay the bill; or if, at the time of drawing, he had no reason to believe that the drawee would accept or pay the same.

An inland bill of exchange is one drawn and payable within this State. All others are foreign.

Notice of the dishonor of a foreign bill of exchange can be given only by notice of its protest, and the protest must be made by a Notary Public, if with reasonable diligence one can be obtained; and if not, then by any reputable person, in the presence of two witnesses. Protest for non-acceptance must be made in the city or town in which the bill is presented for acceptance, and a protest for non-payment in the city or town. in which it is presented for payment.

One who pays a foreign bill for honor must declare, before payment, in the presence of a person authorized to make protest, for whose honor he pays the same, in order to entitle him to reimbursement.

Damages on foreign bills of exchange are allowed as hereinafter prescribed, as a full compensation for interest accrued before notice of dishonor, re-exchange, expenses, and all other damages, in favor of holders for value only, upon bills of exchange drawn or negotiated within the State, and protested for non-acceptance or non-payment.

Damages are allowed as follows:

1. If drawn upon any person in this State, two dollars upon each one hundred dollars of the principal sum specified in the bill.

2. If drawn upon any person out of this State, but in any other of the States west of the Rocky Mountains, five dollars upon each one hundred dollars of the principal sum specified in the bill.

3. If drawn upon any person in any of the United States. east of the Rocky Mountains, ten dollars upon each one hundred dollars of the principal sum specified in the bill.