for that reason no party taking the note with knowledge of its misappropriation, can recover on it against the maker. It being a negotiable note, favored as a commercial instrument, a stranger who takes it before it is due honestly for value, is allowed to recover on it notwithstanding the misuse of the paper. In these cases the borrower, the party accommodated, must indemnify the lender; the law implies an engagement on his part to do so.1

§ 123. A loan of goods or chattels for gratuitous use has all the clements of an ordinary contract, except one; the use is a gratuity from the lender. There cannot therefore be a valid executory contract of this kind. After a delivery of the property, the loan is treated as a contract, though it must be conceded that in some features it closely resembles a license to occupy and use real estate. It confers on the borrower a lawful possession, and it invests him with a special or qualified property; it is as truly a contract as that which is created where goods are delivered to be kept or carried without compensation.* concerns personal property only, and is distinguishable from a mere license.5

It

§ 124. A loan is not to be deemed gratuitous where it is made for the mutual advantage of the lender and borrower; as where the owner of a horse has no present use for him, and lends him to another person to be worked for his keeping; or where chattels are loaned to the borrower for a use which must enure directly to the benefit of the lender;' or where property is delivered to a party, with the option to purchase and pay for it a certain price within a given time. A conditional delivery, with a view to a sale, operates to give the use for the term of the credit agreed upon; but it is not the same thing as a gratuitous loan.

§ 125. The terms of the loan prescribe the use to be made of the property, and the time of that use. Whether expressed or implied, they

1 Brown v. Taber, 5 Wend., 566; Wheeler v. Guild, 20 Pick., 545; Edwards on Bills and Notes, 374.

2 Crosby v. German, 4 Wis., 373; Shillibeer v. Glyn, 2 Mees. and Wels., 145. 33 Kent's Comm., 452. A license is not assignable, and it is revokable. Crocker v. Cowper, 1 Cromp. Mees. & Ros., 418; Morse v. Copelaud, 2 Gray, 302; Pierrepont v. Barnard, 6 N. Y., 279.

4 McCauley v. Davidson, 10 Minn., 418.

"All bailments with or without

compensation to the bailee, are founded on a sufficient consideration."

5 Williams v. Jones, 3 H. & C., 256, 602.

6 Chamberlain v. Cobb, 32 Iowa, 161.

Carpenter v. Branch, 13 Vt., 161.

Bailey v. Colby, 34 N. H., 23; Dunham v. Lee, 24 Vt., 432; Dunlap v. Gleeson, 16 Mich., 158; DeFonclear v. Shottenkirk, 3 John, 170; Harrison v. Marshall, 4 E. D. Smith, 271; see Austin v. Dye, 46 N. Y., 500.

constitute the conditions of the trust upon which the goods are loaned. That they are treated as conditions, rather than as the mere stipulations of an ordinary contract, is evident from the consequences following a breach of them. If a carriage be borrowed for a special use, or a horse to go a particular journey, and they be used differently, it is a breach of the trust under which they are loaned, and the borrower is liable for any loss or injury to them, even by accident. E. g., if a horse be lent to go to London, and he be driven towards Bath in another direction, the borrower becomes responsible for any casualties that may happen in the journey towards Bath. Driving the horse beyond the place designated, is held a conversion of the property, which will support the action of trover.1

3

On a loan of a chattel for a given use for a day, a week or a month, there is an implied understanding that it shall be returned at the time agreed upon; and it has been held that a failure to return it is a conversion of the property. And though this ruling can scarcely be supported on sound principles, it is quite clear that a continued use of the chattel after the time specified, ought to be held a conversion; on the ground that such unauthorized use is a wrongful appropriation of the property. A failure to fulfill a promise, express or implied, may be a breach of contract; but the circumstances must be very peculiar, where such a failure could be deemed a conversion. On the other hand, a man who uses another's goods in violation of his instructions, and for his own advantage, commits a tortious act.*

§ 126. The parties to the contract of loan, as in other cases, must have a legal capacity to make a contract. This is important to be borne in mind, since it may affect materially the remedy of the lender, for an injury to the chattel loaned, under a contract which cannot be enforced at law. Thus, the contract of an infant is not void, but voidable at his election. If a horse is lent to him to go a journey, there is an implied promise that he will make use of great care and diligence to protect the animal from injury and return him at the time agreed upon.

1 Coggs v. Bernard, 2 Ld. Raym., 909, per Chief Justice Holt; Wheelock v. Wheelright, 5 Mass., 104. An unauthorized use of the animal is a conversion of him: Collins v. Bennett, 46 N. Y., 490.

2 Clapp v. Nelson, 12 Texas, 370; Lay's Exr. v. Lawson's Admr., 23 Ala., 377.

3 Ross v. Clark, 27 Miss., 6 Jones, 549.

4 Woodman v. Hubbard, 25 N. H., 67; and Collins v. Bennett, supra; see also Wentworth v. McDuffie, 48 N. H., 402, 406—a case of over-driving a hired horse.

5 Campbell v. Stokes, 2 Wend. R., 137.

But if he pleads his infancy, no action can be maintained against him on this implied promise. If he should sell the horse, an action would lie, and his infancy would not protect him; for that is an election on his part to disaffirm the contract. And so if he be guilty of any willful and positive act of injury to the animal, an action of trespass lies against him for the tort; 2 though he is not answerable on his agreement for injuries resulting through his unskillfulness, or want of knowledge and discretion. The law releasing him from the binding force of his contract, is based on the presumption that he has not yet acquired those very qualities of knowledge and discretion; and consequently he cannot be held responsible on his promise, express or implied, to exercise care and diligence. He is liable for torts, not on matters arising ex contractu.4

§ 127. Married women have not a legal capacity to contract; but in respect to matters usually intrusted to her, the wife may act as the agent of her husband; in his absence, the wife is considered to have a general authority over his property, which must be possessed by some one, unless it be expressly shown that he has constituted some other person his agent for that purpose. If the husband intrusts the wife with money to make deposits in some bank for safe keeping, and she does so, opening an account in her own name, and afterwards withdraws the money, it seems, the court will presume she acted with authority. But the contract is that of the husband, since the wife cannot contract in her own name. A loan to her, unless it be made with the authority of her husband, will not raise the usually implied contract by the borrower, though if it have his assent it will be the same as a loan to him. Her act with his assent binds him; it is his. In respect to the other disabilities of parties, it is not necessary here to enter further into the subject; it is sufficient to say, they are similar in all contracts. In general, married women, infants, lunatics, and other persons not sui juris, are not capable of contracting, nor can they appoint an agent or attorney to act for

3 Jennings v. Randall, 8 Term R., 335; Green v. Greenbank, 4 Eng. Com. Law Rep., 377; 2 Marsh Rep., 485.

4 Homer v. Thwing, 3 Pick., 492; 4 M'Cord's Rep., 387; Bristow v. Eastman, 1 Esp. Rep., 172; Wallace v. Morss, 5 Hill R., 391; Medbury v. Watrous, 7 Hill R., 110; Moore v. Eastman, 1 Hun., 578; Studwell v. Shapter, 54 N. Y., 249. Church v. Sanders, 10 Wend. R., 79.

Dacy v. The Chemical Bank, 2 Hil., 550; Miller v. Delamater, 12 Wend, 433; Edgerton v. Thomas, 9 N. Y., 40.

them; but infants and married women, as we haye seen, may act as agents for others.2

A married woman may now take and hold a separate property the same as if she were unmarried; she may carry on business, and buy and sell and mortgage her goods and chattels,3 and she may with equal right borrow and hold chattels to her own use, without subjecting her husband to any liability on account of them.

§ 128. The Borrower's Interest. Under a loan for use, the possession and a transient special property are transferred for the time and use agreed upon; the borrower takes an interest in the things loaned-what the law calls a special or qualified property. He acquires the possession to which the law attaches the right to protect the property by action against a wrong-doer. He has an interest in the custody and safety of the property, because he is answerable for it to the lender; and this possessory interest will enable him to maintain an action against any third party who wrongfully interferes with the thing loaned. The borrower is liable over on his contract to the lender; this is the ground upon which the law gives him his right of action against third parties. His actual liability in a given case, does not appear to be necessary; it need not be shown to enable him to maintain an action; for there are situations in which he would be entitled to recover, though not himself chargeable with any breach of duty towards the lender."

Y 129. The possession of the borrower is not that of a mere servant, and it does not exclude that of the owner, who may in most cases maintain an action for the conversion of the goods by a stranger; and a judgment obtained in his favor will be a good bar to a suit brought in favor of the bailee. Either of them may bring the action, because the bailee's possession is that of the owner, and possession under the right

1 Snyder v. Sponable, 1 Hill's R., 567; Whitmarsh v. Hall, 3 Denio, 375; The People v. Moores, 4 Denio, 518; Dominick v. Michael, 4 Sand. R., 376; Smith v. Oliphant 2 Sand. R., 306–711; Crippen v. Culver, 13 Barb. S. C., 424.

2 Co. Lit., 52 a; 1 Hill's South Car. R., 270; Riley v. Suydam, 4 Barb. S. C. R., 222.

3 Van Sickle v. Van Sickle, 8 How. Pr. 265; Talman v. Hawkshurst, 4 Duer, 221; that is when she engages in business; Second Nat. Bank v. Miller, 63 N. Y., 639; Jones v. Walker, 63 N. Y., 612.

42 Black. Comm., 452, 453; Burton v. Hughes, 2 Bing., 173; Hurd v. West, 7 Cowen, 752; Nichols v. Bustard, 2 Cromp. Mees. & Ros., 659; Bliss v. Schaub, 48 Barb., 339; Hendricks v. Decker, 35 Barb., 298; Duncan v. Spear, 11 Wend., 54; Paddock v. Wing, 16 How. Pr. 547; Van Winkle v. The U. S. M. S. Co., 37 Barb., 122; Kissam v. Roberts, 6 Bosw., 154.

Kellogg v. Sweeney, 1 Lansing, 397. the guest of an innkeeper; 46 N. Y., 291. gence of the innkeeper and of his servants;

The bailee in this case recovered as And the bailee is liable for the negli Hall v. Warren, CO Barb., 198.

ful owner, is sufficient against a person having no color of right.' When the bajlee fras no interest or claim to hold the goods, coupled with his possession, the rule of law applies that the general property draws after tho possession; so that the owner has the right of immediate possession.

3

Without doubt the lender, who loans chattels for an indefinite time, retains the constructive possession of them, and is entitled to reduce the goods to actual possession at his pleasure; and it seems he has the power by strict right at all times to revoke the loan,1 and repossess himself of the property which forms its subject. This right of revocation may in some cases work injustice towards the borrower, where he has borrowed an article for a particular purpose, which remains unaccomplished at the period chosen by the lender to revoke the loan. Under the Roman law and other codes derived from it, the lender was not permitted to terminate the contract otherwise than as contemplated by the parties to it. But at common law, it appears the borrower, like the bailee under the contracts of mandate and deposit, has no legal interest in the subject of the bailment as against the bailor. The lender, having the general property in the loan, has the right to reduce it to his actual possession whenever he pleases, and is therefore constructively all the while in possession; so that under the old practice he could sustain the action of trespass de bonis asportatis.

Story intimates the opinion, that notwithstanding the lender's right to terminate the contract of loan whenever he pleases, still if he do so unreasonably, while the object of the bailment is but partly accomplished, and actually occasions injury or loss to the borrower by so doing, the latter may have a suit for damages; or may recoup his damages in an action brought against him for retaining the loan under such circumstances. As no authority is cited for this opinion, its weight must depend

1 Falkner v. Brown, 13 Wend., 63; 2 Saund., 47; Sutton v. Buck, 2 Taunt., 309; Bliss v. Schaub, 48 Barb., 339, 343.

2 Thorp v. Burling, 11 John. R., 285; Hall v. Tuttle, 2 Wend., 475.

3 Orser v. Storms, 9 Cowen R., 687; Smith v. Miles, 1 T. R., 480; Neff v. Thompson, 8 Barb., 213, 216.

45 Bac. Ab. Tresp. ( C.), pl. 9, 16, 17; Putnam v. Wyley, 8 John. R., 433; 2 Camp. R., 464; Story on Bailm., § 277.

6 Root v. Chandler, 10 Wend. R., 110; 7 Term R., 12; 3 Day, 498, 272; Herring v. Hoppock, 15 N. Y., 409, 412, 414; Ash v. Putnam, 1 Hill, 302, 306.

7 Story on Bailm., § 258. "The ground of this doctrine, as stated in the Roman law, is, that although it is purely a voluntary act to make the loan, and to prescribe the terms thereof; yet when once it is made, the lender would, by an unreasonable withdrawal of the loan, impose a burden rather than a benefit, and thus violate the implied obligation between the parties."