amount agreed to be paid therefor, he will be deemed a holder in due course only to the extent of the amount theretofore paid by him.

[TITLE DEFECTIVE

THROUGH OBTAINING INSTRUMENT OR SIGNATURE THROUGH FRAUD OR DURESS.] § 55. The title of a person who negotiates an instrument is defective within the meaning of this act when he obtained the instrument, or any signature thereto, by fraud, duress, or force and fear, or other unlawful means, or for an illegal consideration or when he negotiates it in breach of faith, or under such circumstances as amount to a fraud.

[NOTICE OF INFIRMITY — WHAT CONSTITUTES.] 56. To constitute notice of an infirmity in the instrument or defect in the title of the person negotiating the same, the person to whom it is negotiated must have had actual knowledge of the infirmity or defect, or knowledge of such facts that his action in taking the instrument amounted to bad faith.

[RIGHTS OF A HOLDER IN DUE COURSE.] § 57. A holder in due course holds the instrument free from any defect of title of prior parties, and free from defenses available to prior parties among themselves and may enforce payment of the instrument for the full amount thereof against all parties liable thereon (except the defect and defense specified in section 10 of act entitled "An act to revise the law in relation to promissory notes, bonds, due bills and other instruments in writing," approved March 18, 1874, in force July 1, 1874, and except the defect and defense specified in sections 131 and 136 of an act to revise the law in relation to criminal jurisprudence, approved March 27, 1874, in force July 1, 1874, known as sections 131 and 136 of Chapter 38 of the Revised Statutes of Illinois,

and may enforce payment of the instrument for the full amount thereof against all parties liable thereon.)

[RIGHTS OF A HOLDER DERIVING HIS TITLE THROUGH HOLDER IN DUE COURSE.] § 58. In the hands of any holder other than a holder in due course, a negotiable instrument is subject to the same defenses as if it were non-negotiable. But the holder who derives his title through a holder in due course, and who is not himself a party to any fraud or duress or illegality affecting the instrument, has all the rights of such former holder in respect to all parties prior to such holder.

COURSE

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[PRESUMPTION IN FAVOR OF HOLDER IN DUE SHIFTING BURDEN EXCEPTION.] 8 59. Every holder is deemed prima facie to be a holder in due course; but when it is shown that the title of any person who has negotiated the instrument was defective, the burden is on the holder to prove that he or some person under whom he claims acquired the title as a holder in due course. But the last mentioned rule does not apply in favor of a party who became bound on the instrument prior to the acquisition of such defective title.

ARTICLE V.-LIABILITIES OF PARTIES.

[ENGAGEMENTS OF MAKER.] § 60. The maker of a negotiable instrument by making it engages that he will pay it according to its tenor, and admits the existence of the payee and his then capacity to indorse.

[ENGAGEMENTS OF DRAWER.] § 61. The drawer by drawing the instrument admits the existence of the payee and his then capacity to indorse, and engages that on due presentment the instrument will be accepted or paid, or both, according to its tenor,

and that if it be dishonored, and the necessary proceedings on dishonor be duly taken, he will pay the amount thereof to the holder, or to any indorser who may be compelled to pay it. But the drawer may insert in the instrument an express stipulation negativing or limiting his own liability to the holder.

[ENGAGEMENTS OF ACCEPTOR.] § 62. The acceptor by accepting the instrument engages that he will pay it according to the tenor of his acceptance, and admits:

1. The existence of the drawer, the genuineness of his signature, and his capacity and authority to draw the instrument; and

2. The existence of the payee and his then capacity to indorse.

[SIGNING OTHERWISE THAN AS MAKER, DRAWER

OR ACCEPTOR DEEMED AN INDORSEMENT UNLESS RE

STRICTED.] 63. A person placing his signature upon an instrument otherwise than as maker, drawer or acceptor is deemed to be an endorser, unless he clearly indicated by appropriate words his intention to be bound in some other capacity.

[LIABILITY OF INDORSER IN BLANK BEFORE DELIVERING.] § 64. Where a person, not otherwise a party to an instrument, places thereon his signature in blank before delivery, he is liable as indorser in accordance with the following rules:

1. If the instrument is payable to the order of a third person, he is liable to the payee and to all subsequent parties.

(1. If the instrument is a note or bill, payable to the order of a third person or an accepted bill, payable to the order of the drawer, he is liable to the payee and to all subsequent parties.)

2. If the instrument is payable to the order of the maker or drawer, or is payable to bearer, he is liable to all parties subsequent to the maker or drawer.

(2. If the instrument is a note or unaccepted bill payable to the order of the maker or drawer, or is payable to bearer, he is liable to all parties subsequent to the maker or drawer.)

3. If he signs for the accommodation of the payee, he is liable to all parties subsequent to the

payee.

[WARRANTIES IMPORTED BY NEGOTIATION BY DELIVERY OR QUALIFIED INDORSEMENT.] § 65. Every person negotiating an instrument by delivery or by a qualified indorsement, warrants:

1. That the instrument is genuine and in all respects what it purports to be.

2. That he has a good title to it.

3. That all prior parties had capacity to contract. 4. That he has no knowledge of any fact which would impair the validity of the instrument or render it valueless.

(4. That he has no knowledge of any fact which would impair the validity of the instrument.)

But when the negotiation is by delivery only, the warranty extends in favor of no holder other than the immediate transferee.

The provisions of subdivision three of this section do not apply to persons negotiating public or corporate securities, other than bills and notes.

[WARRANTIES OF ALL INDORSERS EXCEPT ACCOMMODATION INDORSERS WITH QUALIFICATION.] § 66. Every indorser not an accommodating party who indorses without qualification, warrants to all subsequent holders in due course:

Vol. IX.-7.

1. The matters and things mentioned in subdivision one, two, three and four of the next preceding section; and

2. That the instrument is at the time of his indorsement valid and subsisting.

And, in addition, every indorser engages that on due presentment, it shall be accepted or paid, or both, as the case may be, according to its tenor, and that if it be dishonored and the necessary proceedings on dishonor be duly taken, he will pay the amount thereof to the holder, or to any subsequent indorser who may be compelled to pay it.

[INDORSEMENT OF INSTRUMENT NEGOTIABLE BY DELIVERY.] § 67. Where a person places his indorsement on an instrument negotiable by delivery he incurs all the liabilities of an indorser.

[INDORSERS MENTS-JOINT AND SEVERAL LIABILITY.] § 68. As respects one another, indorsers are liable prima facie in the order in which they indorse; but evidence is admissible to show that as between or among themselves they have agreed otherwise. All parties jointly liable on a negotiable instrument are deemed to be jointly and severally liable.

LIABLE IN ORDER OF INDORSE

[LIABILITY OF BROKER OR AGENT NEGOTIATING INSTRUMENT WITHOUT INDORSEMENT.] § 69. Where a broker or other agent negotiated an instrument without indorsement, he incurs all the liabilities prescribed by section sixty-five of this act, unless he discloses the name of his principal, and the fact that he is acting only as agent.

[MEASURE OF DAMAGES ON PROTEST OF BILL

DRAWN OR INDORSED WITHIN THIS STATE AND PAYABLE

WITHOUT THE STATE.] § 69a. Whenever any bill of exchange drawn or indorsed within this state and