in blank.1 There is no just ground for this distinction.2 The indorsement seldom consists of anything more than the indorser's signature; but if the agreement imported by that signature were written out in full above it, the undertaking of the indorser would not be more clearly defined than it is by the signature itself. Its presence there is as plain a manifestation of the intention of the party, as if it were set forth in express words, and parol evidence should not be admitted to vary or contradict it.3

In the application of this principle to indorsements in blank, it has been held that in an action by an indorsee against his immediate indorser it is not admissible for the latter to introduce parol evidence to show that it was agreed, when he indorsed the instrument, that he should not be liable until certain estates were sold, or that his liability was otherwise conditional, and not absolute, or that it was given only to be negotiated at a certain bank.

Nor could the indorser show that he was not to be considered personally liable, and that the indorsement was "without recourse," or that his liability was to be that of a guarantor; nor could the indorsee show by parol evidence that at the time of indorsement the indorser agreed to be liable without the holder making demand on the maker at maturity.

The language of the rule as stated in the text implies its limitation, for it does not extend to exclude parol evidence to show fraud, or want or failure of consideration, which impeach the original or present validity of the indorsement. Such evidence does not vary or contradict the liability imported by the contract, but impeaches it as a contract. Therefore, it is admissible between the parties for

10

1 Perkins vs. Catlin, 11 Conn., 213; Hill vs. Ely, 5 Sergt. & R. 363; Susquehanna Co. rs. Evans, 4 Wash., C. C. 480; Smith es. Barber, 1 Root., 207.

3

2 Woodward vs. Foster, 18 Grat., 205; Brown vs. Wiley, 20 Howard, 442.

Bayley on Bills, (Am. Ed.) 363; 2 Parsons, N. & B. 23, 24, and 520.

Free vs. Hawkins, 8 Taunt., 92.

5 Bank U.S. vs Dunn, 6 Peters, 51; Woodward rs. Foster, 18 Grat., 200.

6 Stubbs is. Goodall, 4 Ga., 106.

7 Woodward vs. Foster, 18 Grat., 200; Wilson vs. Black, 6 Blackt., 509; Crocker vs. Getchell, 23 Maine, 392; Contra Hill vs. Ely, 5 Sergt. & Rawle, 363; Patterson vs. Todd, 18 Penn. St., 426; Bircleback vs. Wilkins, 22 Peen. St. 26.

* Howe vs. Merrill, 5 Cush, 80; Fuller vs. McDonald, 8 Greenl.; 213; Dibble rs. Duncan, 2 McLean, 353.

9 Bank of Albion vs. Smith, 27 Barb., 489; Barry vs. Morse, 3 N. II., 132; Free See Story on Prom. Notes, ? 118; Contra.

vs. Hawkins, 8 Taunt., 92.

10 Greenleaf on Ev., M. S., 1 Mood. & M., 226, (22 E. C.

284; Foster rs. Jolly, 1 C. M. & R., 703; Pike rs. Street L. R.); Woodward vs. Foster, 18 Grat., 200.

the indorser to show that there was no consideration for the indorsement; or that the instrument was indorsed and handed over for a particular purpose, as for collection without giving to the trustee the usual rights of an indorsee; or that it was transferred as an escrow, or upon an express condition which has not been complied with.3

The English case in which it was held that the indorser could show a parol agreement by the indorsee not to sue him, but the acceptor only, has led to the statement of a very different rule from that of the text by Byles in his excellent treatise; but the more recent authorities, and, as it seems to us, the best considered, fully sustain the principle herein laid down; and that case, if indeed at all reconcilable with the others cited, can only be supported upon the idea that the evidence impeached the consideration.

1Ibid; Smith vs. Carter, 25 Wisc., 283.

2 Manley vs. Boycot, 2 El. & Bl., 46, (75 E. C. L. R.); Hoare ve. Graham, 3 Camp., 57.

3 Bell rs. Lord Ingestre, 12 Q. B., 317, (64 E. C. L. R., 10); Ricketts vs. Pendleton, 14 Md., 320; Wallis es. Littell, 11 Com. B., 369.

1Pike vs. Street, 1 Mood. & Malk., 226, (22 E. C. L. R.)

In Byles on Bills (Sharswood's ed.,) 267, it is said: "The contract between indorser and indorsee does not consist exclusively of the writing popularly called an indorsement. The contract consists partly of the written indorsement, partly of the delivery of the bill to the indorsee, and may also consist partly of the mutual understanding and intention with which the delivery was made by the indorser, and received by the indorsee. That intention may be collected from the words of the parties to the contract, either spoken or written, from the usage of the place, or of the trade from the course of dealing between the parties or from their relative situation": Kidson . Dilworth, 5 Price, 564; Castrique rs. Battigieg, 10 Moore, P. C. cases, 94.

6 Woodward es. Foster, 18 Grat., 205, in which case it was said, in delivering the opinion of the court by Joynes, J.: "When the legal import of a contract is clear and definite, the intention of the parties is for all substantial purposes, as distinctly, and as fully expressed, as if they had written out in words what the law implies. It is immaterial how much or how little is expressed in words, if the law attaches to what is expressed a clear and definite import. Though the writing consists only of a signature, as in the case of an indorsement in blank, yet, where the law attaches to it a clear, unequivocal, and definite import, the contract imported by it can no more be varied, or contradicted by evidence of a cotemporaneous parol agreement, than if the whole contract had been fully written out in words. The mischiefs of admitting parol evidence would be the same, in such cases, as if the terms implied by law had been expressed. In Pike rs. Street, 1 Mood. & Malk. R., 226, (22 E. C. L. R., 299,) tried before Lord Tenterden, at Nisi Prius, the action was brought by the indorsee of a bill of exchange against his immediate indorser. The defense was, that though the plaintiff gave value to the defendant, it was upon a verbal agreement that he should sue the acceptor only, and that he should not sue the defendant as indorser. Lord Tenterden held that such an agreement, if proved, would be

SUCCESSIVE INDORSEMENTS.

$32. When several persons indorse a bill or negotiable note in succession, the legal effect is to subject them as to each other in the order they indorse. The indorsement imports a several and successive, and not a joint obligation, whether the indorsements be made for accommodation or for value received, unless there be an agreement aliunde different from that evidenced by the indorsements. The indorsers may make an agreement to be jointly and equally bound, but whoever asserts such an agreement must prove it. In cases, therefore, in which no such agreement is proved, the indorsers are not bound to contribution amongst themselves, but each and all are liable to those who succeed them.1

The indorser is not necessarily bound according to the actual time of indorsation, but according to the contract; and if it appear that the instrument was indorsed by one party with the agreement that another should become prior indorser, the latter will be held responsible first in point of contract though second in point of time.2

Where a note is indorsed by payee and by a third party, the legal inference is that the payee is prior indorser, but it may be proved otherwise by parol evidence.3

There is no limit to the number of indorsements, and if there be not room to write them all on the instrument, they may be written on a piece of paper fastened thereto, which is called in French an "allonge," and is thenceforth considered a part of the bill.

a good bar to the action. This case was cited by counsel in Foster vs. Jolly, 1 C. M. & R., 703, as an authority to show that evidence of a cotemporaneous parol agreement might be given to vary the written contract of an indorser. But Parke B. said that that case fell within the cases in which the consideration is contradicted; the evidence went to show that there was no consideration as between the plaintiff and the defendant. Whether this observation was or was not justifiable by the facts of the case, it indicates the ground upon which alone, in the opinion of a judge of the greatest learning and eminence, the opinion of Lord Tenterden can be sustained."

1

1 Hogue vs. Davis, 8 Grat., 4; Bank U. S. vs. Beirne, 1 Grat., 265; Farmers' Bank 8. Vanmeter, 4 Rand., 553; Chalmers vs. McMurdo, 5 Munf., 252; McCarty us. Roots, 21 Howard, 432; Rey vs. Simpson, 22, Id., 350; Phillips vs. Preston, 5 Howard, 278; McDonald vs. Magruder, 3 Peters, 470; Moody vs. Findley, 43 Ala., 167; McCune es. Belt, 45 Misso., 174.

2 Chalmers vs. McMurdo, 5 Munf., 252.

Cady vs. Shepherd, 12 Wisc., 639.

4 French 28. Turner, 15 Indiana, 59; Byles on Bills, 263; Folger vs. Chase, 18 Pick, 63; Crosby vs. Roul, 16 Wisc., 616.

A third indorser having indorsed a note on the faith of the solvency of a prior indorser; and on a renewal of the note the order of the indorsements having been changed without the consent of this third indorser, who for the convenience of renewing the note, left his blank indorsement with the makers; a court of equity will relieve him as against the indorser who should have preceded him.1

$33. There is sometimes a difficulty in determining whether or not a party stands in the relation of an indorser to the paper, or in that of an original maker, or surety, or guarantor; and there is great diversity on the decisions of the State tribunals. In those States, where a note payable to bearer is negotiable, if a third person put his name on the back of it, without more, he is liable as an indorser, and can be charged only by due demand and notice."

3

But when one not a party to a negotiable note indorses his name in blank on the back of it before it is delivered to or indorsed by the payee, a question is presented which has caused much disputation. In the case of a non-negotiable note, such a person may be regarded as a surety or guarantor, there being no such thing as "indorsement" of non-negotiable. paper, in the commercial sense of the word;" but when the note is negotiable, it has been held in many cases that the character of the liability incurred is to be ascertained by considering all the attendant circumstances.

$34. When the paper is sued upon by a bona fide holder, and it does not appear from extraneous evidence (if, indeed, it be admissible) in what manner the person who wrote his name on the back of it intended to bind himself, it has been held in many of the States that he is an indorser, and as such entitled to notice of dishonor and all other privileges of an indorser. This we consider the correct view, and supporting it are the decisions in New York,

1Slagle vs. Rust's Admr., 4 Grat., 274; Slagle is. Bank of Valley, Id.

2 Hall 8. Newcomb, 7 Hill, 416; Brush vs. Reeves Admrs., 3 Johns., 439; Eccles

. Ballard, 2 McCord, 388; Allwood vs. Haselders, 2 Bailey, 457.

3 Watson es, Hurt, 6 Grat., 633; Griswold us, Slocum, 10 Barb,, 402; Cooley vs. Lawrence, 4 Martin, 639,

*Orrick es. Colston, 7 Grat.; Watson vs, Hurt, 6 Grat., 633.

See Story on Notes,

Hall vs. Newcomb, 7

134; 2 Pars., N. & B., 120.

Hill, 416; Spies vs. Gilmore, 1 Comstock, 32; Ellis vs. Brown, 6 Barb., 282; Waterbury vs. Sinclair, 26 Barb., 455; See Par. N. & B.; These cases overrule the earlier New York cases; See Herrick vs. Carman, 12 Johns., 159; Campbell vs. Butler, 14 Id., 349,

5

Virginia, Tennessee, Mississippi,3 Iowa, Indiana, California, Wisconsin.

In other cases it has been held that such a party is prima facie liable as a joint maker, and some of them as a guarantor or surety using the term as equivalent to maker;" while others decide that he is liable as a guarantor.10

In Greenough vs. Smead, 3 Ohio State R., 415, it was held that if one not a party put his name on the back of a note, which is subsequently indorsed by the payee below his signature, but not being intended for the payee, such party is to be regarded as an indorser; but if the note were intended for the payee, the liability of such third person is that of maker or guarantor."

$35. In Massachusetts, where such person is regarded as a surety, it has been held that if the payee afterwards indorse above the signature of the third party, the latter then becomes an ordinary indorser;12 and that if the signature is written subsequently to the execution of

1 Watson 8, Hurt, 6 Grat., 633.

This case seems to be misapprehended by

Prof. Parsons, (2 N. & B., 120, note E.,) who cites it as holding that such third person is prima facie regarded as guarantor. The court expressly says that if the note be negotiable, the party is an indorser, and a guarantor if it be nonnegotiable.

2 Clonston vs. Barbiere, 4 Sneed, 336; Comparree vs. Brockway, 11 Humph., 355. 3 Jennings vs. Thomas, 13 Smedes and M., 617.

4 Fear vs. Dunlop, 1 Greene, 331,

Sills. Leslie, 16 Indiana, 236; Vore vs. Hurst, 13 Id., 551; Wells vs. Jackson, 6 Blackft., 40.

6

Riggs vs. Waldo., 2 Cal., 485; Pierce vs. Kennedy, 5 Cal., 138.

7 King vs. Ritchie, 18 Wisc., 615; Heath vs. Vancott, 9 Wisc., 516.

Vt., 642; Baker 18.
Draper ts. Weld, 13

8 Sylvester vs. Downer, 20 Vt., 355; Knapp vs. Parker, 6 Briggs, 8 Pick., 122; Union Bank vs. Willis, 8 Met., 504; Gray, 580; Hawkes vs. Phillips, 7 Gray, 284; Weatherwax vs. Paine, 2 Mich., 555; Schneider vs. Schiffman, 20 Misso., 571; Lewis vs. Harvey, 18 Misso., 74; Childs vs. Wyman, 44 Maine, 433; Martin vs. Boyd, 11 N. H., 385; Carpenter vs. Oaks, 10 Rich. (Law, 17.)

9 Cook vs. Southwick, 9 Texas, 615; Carr vs. Rowland, 14 Texas, 275; McGuire 23. Bosworth, 1 La. Ann., 248.

10 Camden vs. McKoy, 3 Scammon, 437; Cushman vs. Dement, 4 Scammon, 497; Carroll us. Weld., 13 Ill.. 682; Klein vs. Currier, 14 Ill., 237; Webster vs. Cobb, 17 Ill., 459; Clark vs. Merriam, 25 Conn., 576; See Story on Notes, ? 133.

11 To same effect are Seymour vs. Leyman, 10 Ohio St., 283; Peckam vs. Gilman,

7 Minn., 446; Quin vs. Sterne, 26 Ga., 223; Perkins vs. Barstow, 6 R. I., 505. 12Clapp vs. Rice, 13 Gray, 403; Howe vs. Merrill, 5 Cush., 80; Vose vs. Hust, 13 Indiana, 551.