tenor of the former decisions, above quoted, as to the assignability of choses-in-action, when made assignable by the Obligor himself. But soon a strange conflict of decision took place, and a warm dispute arose between the City and the Court of King's Bench presided over by Lord Holt.

1

In a series of cases it was held that the "bearer" had no right of action against the acceptor or maker, of a Bill or Note payable to bearer-that Promissory Notes were not within the custom of merchants-and that they could not be declared upon as Bills of Exchange. In the last case mentioned above, Lord Holt expressed himself very strongly against Promissory Notes payable to bearer, which he said were only an invention of the goldsmiths in Lombard Street. The Chief Justice had a conference with some eminent merchants in the City, who told him that such notes had been in common use for about 30 years, and were looked upon, and transferred by indorsement, as Bills of Exchange. The Court, however, decided against them. In consequence of these decisions, the Act, Stat. 1704, c. 9, was passed, placing Promissory Notes in all respects on the same footing as inland Bills of Exchange.

How the strange facts are to be accounted for-that Bills of Exchange in the form of Promissory Notes payable to bearer, and Bills of Payment, or Notes payable to assigns, or order, were in common use in London, in the 15th and 16th centuries, and then had totally disappeared at the beginning of the 17th century, and reappeared at its close, but were supposed to be then a new species of document, so that their former use was not known-it is not easy to say.

52. We must also especially remark that the name of Promissory Notes seems only to have been finally adopted for these Instruments since the Statute of Anne. Before that time they were called Bills of Payment, Bills of Debt, Bills of Credit, Bills Obligatory; Bank Notes were called Bank Bills. In the Act establishing the Bank of England its Notes are termed "Bills of Credit " and "Bills Obligatory." In one case a note

1 Hodge v. Steward, 1 Salk., 125; Horton v. Coggs, 3 Lev., 299, in 1691; Nicholson v. Sedgewick, 1 Ld. Raym., 180, 1698; Cogg's Case, Comb., 466, in 1699; Carter v. Palmer, 12 Mod., 389, in 1701; Clerke v. Martin, 2 Ld. Raym., 757; Culting v. Williams, 2 Ld. Raym., 825, in 1703; and Buller v. Crips, 6 Mod., 29, in 1704.

for the payment of money is termed an inland bill by the Court. In another case' two goldsmith's or banker's notes were declared upon as Bills of Exchange, and they are called "bills" throughout the case. Again, it is said "If a merchant's apprentice draws a bill (as I do promise to pay such a sum for my master') to charge the master with this note." So in several cases Bank Notes are called bills. In many parts of the country at the present day bank notes are always called bank bills, and the term bank notes would not be understood.

The common opinion therefore that Promissory Notes are not transferable at Common Law, and that they were unknown to Commercial usage, until comparatively recent times, dating only from the end of the 17th century, is entirely erroneous both in Law and Fact. Obligations in both forms were equally called Bills and Notes, and are equally valid at Common Law. Non figurâ litterarum sed oratione quam exprimunt litteræ obli gamur. A Bill of Exchange in former times meant nothing more than an obligation to pay the value of a certain amount of the money of one country in the money of another, at a certain rate of exchange; and it was perfectly common to draw the obligation in the form either of an ORDER or of a PROMISE; and both forms were perfectly valid. When the obligation was to pay in the money of this country it was called an Inland Bill, whether its form was that of an Order or a Promise. The words Billa or Nota mean nothing more than a writing.

Since, however, the series of erroneous decisions in the King's Bench which gave rise to the statute of Anne, the word BILL has been restricted to ORDERS to pay; and the word NOTE to PROMISES to pay.

Hence in reading old cases and books it must be observed that the words Bill or Note were used synonymously to denote any written obligation: in modern cases and books they are used to mark the distinction between ORDERS to pay and PROMISES to pay.

One great establishment still keeps up the old hybrid form of 1 Hill v. Lewis, 1 Salk, 131. Boulton v. Hillesden, Comb., 450.

3 Anonymous, 1 Ld. Raymond, 738. Nicholson v. Sedgwick, 1 Ld. Raym., 180. Bank of England v. Newman, 12 Mod., 241. Anonymous 1 Salk., 125. Lambert v. Oakes, 1 Ld., Raym., 443.

Digest, xliv., 7: 37.

the obligation in a species of paper it issues; the following is the form of a

No.

BANK of ENGLAND POST BILL.

London,

18.

At seven days' sight I promise to pay this my sola Bill of

Exchange to

ONE HUNDRED.

£ ONE HUNDred. Entd.

or order sterling value received of

For the Governor and Company of the Bank of England.

On BILLS of EXCHANGE and PROMISSORY NOTES.

53. In its most general form, a Bill of Exchange is a letter from a Creditor to his Debtor, ORDERING him to pay-first, a certain sum of money; secondly, to a certain person; thirdly, at a certain event. The usual form is this:

£287 15: 8

London, May 4th, 1872. Three months after date, pay to myself (or A. B.), or order, the sum of Two Hundred and eighty-seven pounds fifteen shillings and eight pence, value received.

To Mr. John Cox,

Linendraper,

Strand, London.

WILLIAM SMITH.

The person who addresses the letter is termed the Drawer ; the person to whom it is addressed is called the Drawee; and the person to whom it is to be paid is called the Payee.

It is the payee's business, on the first convenient opportunity after he has received the letter, to present it to the drawee, to know if he will pay it; if he consents to do so, it is usual for him to write his name, with the word "accepted" across the face of the bill; he is then called the Acceptor.

The drawer may make the bill payable either to a third person, or to his order, or to himself, or to his own order. If it be made payable to a third person only, or to the drawer himself only, without inserting the words "or order," the bill can only be paid to the person named, and cannot be transferred to any one else, or cannot be negotiated, as it is termed.

If the words " or order are inserted after the payee's name, he can transfer it to any one else. This is done by writing his name on the back of the bill; hence it is called an Indorsement: the person who does it is called the Indorser, and the person to whom it is delivered is called the Indorsee.

The indorsee may, if he pleases, indorse it again to some one else, and if he make it payable to that person only, it is called a special indorsement, and can only be paid to him; but if he delivers it over with his own name only written on the back, it is called a general indorsement, or an indorsement in blank. Its effect is that it makes the bill transferable by mere delivery, without any further indorsement, exactly like a bank note or money; and the bill is then payable to bearer like a bank note.

Formerly indorsement was in all cases necessary to transfer the property in a bill or note. But this has long ceased to be the case in English law. It became the custom of merchants in England, which has long acquired the force of law, that any instrument of credit indorsed in blank, may be transferred by simple delivery, without any further indorsement.

It is still, however, the custom to indorse them on a transfer; at least there are very few persons who would take them without indorsement. And the effect of the indorsement is this: that if the bill be not paid by the acceptor at maturity, and if the owner, or holder, of it gives immediate notice to any, or all, of the preceding parties to it, he has a right to enforce payment of it from them.

But this demand for payment must be made without delay, in almost all cases within twenty-four hours after the fact of nonpayment is known to the holder. If delay be made in notifying the fact, and demanding payment from the parties liable, they are absolved, and the holder's remedy is gone.

Thus in modern practice the indorsement is merely a limited warranty of soundness. There is no other difference between buying goods or money with a bill, with or without an indorsement, than between buying any other article such as a horse, a watch, or a carriage, with or without a limited warranty. It is in all cases a sale. In the case of a bill taken without an indorsement, or a horse bought without a warranty, the sale is final and conclusive; in the case of a bill taken with an indorsement, or a horse bought with a warranty, the sale may be

cancelled, if the defect be discovered, and the demand made within the time limited, otherwise it is also final and conclusive. The general rule of English law is now, that if any instrument of Credit whatever, whether it be a Bank Note, or a Bill of Exchange, be taken in exchange for goods or money in any transaction without indorsement, or if the period allowed for making a claim be suffered to elapse, it is a final closing of that transaction, and the receiver has no remedy against the transferor, if the instrument be not paid. The payment is, in fact, in all respects, as valid and final as if it were money.

Except only in the case of fraud, where the payer knew that the banker or person whose note or bill he tendered, was bankrupt or insolvent.

insert the words "value In former times it was from, whether money or

It is usual, in English Bills, to received," but it is not necessary. necessary to state what the debt arose goods. But this has long fallen into disuse in this country. A Promissory Note is an absolute promise to pay (1) a certain sum of money (2) to a certain person, (3) at a certain time: it is usually expressed thus

£143 4 9.

London, May 4th, 1872.

Three months after date, I promise to pay John Stiles' or order, the sum of One hundred and forty-three pounds four shillings and nine pence, for value received.

TIMOTHY GIBBONS.

In this case, Timothy Gibbons is called the Maker of the note, and John Stiles the Payee.

Promissory notes, of all sorts, including Bank of England notes, as well as the notes of private bankers and merchants, were all placed exactly on the same footing as inland bills of exchange by the Acts, Stat. 1694, c. 20, s. 29; and Stat. 1704, c. 8, that is, they were all made tranferable by indorsement on each separate transfer.

In the case however of bank notes (by which, in law, is always meant Bank of England notes), as these were always payable ondemand, and the payment was quite secure, the practice of indorsement soon fell into disuse, and they passed from hand to hand like money. In the case of private bankers of great name, the indorsement was often omitted. But, though the