It is best for each endorser, upon receiving notice, to send notice to those who precede him, as he cannot know that it has been duly given, except (as is the practice of some notaries) where the notary or clerk minutes upon each notice sent the names of other endorsers notified.

The endorser may, and frequently does, waive demand and notice, and such an agreement is valid and binding, without any special consideration. The words over the name of the endorser, and written by him or with his sanction, "demand and notice waived," are sufficient, and is the usual form.

It has been held in one case in a highly respectable court, (Coddington vs. Davis, I. Comstock, N. Y. Court of Appeals, 189, 190), that the words, "protest waived," would be sufficient, but this is doubtful, as promissory notes need no protest, and a waiver of protest might properly be held to apply only to such official action as would properly be connected with a protest and notice, and not a waiver of proper primary demand by the holder. The holder may not give time to the maker of a note or the acceptor of a bill, unless he would risk the loss of his claim upon the endorsers, and if he agree to delay collection, by a contract, for such consideration and so made as to be valid and binding, the endorsers are thereby discharged.

A simple forbearance to sue, or taking collateral security from a maker, is no discharge, and is perhaps for the benefit of the endorsers; but giving a new credit and time by a valid agreement, or accepting a composition and discharging the maker or acceptor, (unless the rights against the endorser or surety are specially reserved in the instrument of discharge), will work such discharge; the principle being, that the maker of a bill and the endorsers of a note are in the light of sureties, and the holder may not in any way diminish or delay the claim, which they would, upon payment, have against their principal.

Receiving a composition or a dividend from the estate of a bankrupt will not work a discharge of sureties or endorsers, as that cannot prejudice them, but is in aid of their rights and claims.

What the rule requires is simply, that the holder shall not so deal with the acceptor of the bill or maker of the note, by giving new credit, or additional time, or discharging him upon part payment, as to prejudice the rights of other parties to the bill, without their assent.

A holder may give time to an endorser, and proceed against prior parties, but he cannot reverse the order. I have said that endorsers are in the "light of sureties," but this must be taken with qualification, for though a surety is discharged, if the party to whom he is bound discharges securities held by him as collateral, the same rule does not apply to an endorser, and he will not be discharged, though the payee or a subsequent endorser takes security of the maker and discharges it without his assent.

Not only does the release, or giving time or new credit to the maker, discharge an endorser, but the release of a prior endorser discharges all subsequent ones. If due notice be not given or demand be not made, yet this may be waived by an endorser, and a subsequent promise to pay, clearly and unconditionally made, with knowledge of the facts, will be evidence of such waiver, even when the party does not actually know the law; and any declaration or promise made by an endorser or his agent, which is equivalent to an acknowledgment of liability or a promise to pay, may go to the jury as evidence of due receipt of notice.

There is an anomalous liability, growing out of the endorsement of a note by a third party before it is endorsed by the payee, or of a note payable to bearer, and whenever a party holds such a note it will be well for him to take advice as to the local law, where his claim is to be enforced, or where the contract was made or is specially made payable.

In Massachusetts it has been held in a series of cases, and may be considered settled law for that State, that such a writing of the name of a third party upon the back of a note, before the note is delivered to the payee, renders the party liable as a maker and principal, precisely as if his name had been written upon the face of the instrument, under the signature of the principal maker, and he is entitled neither to demand or notice.

In New York and Connecticut, the liability of such a signer upon the back of an instrument is neither that of maker nor endorser, but is that of a guarantor, or surety; so that, while a holder would not be bound to give him notice, he must not give time to the maker, or release collaterals, and must proceed to collect his note, or give notice to the guarantor within a reasonable time, or else, if the guarantor has been damnified, he will be discharged

SECTION 7.

Of the Acceptance of a Bill of Exchange.

We have seen that the maker (or drawer) of a bill of exchange is presumed to have drawn it upon funds of his in the hands of the drawee, and by drawing and delivering it he is understood to contract that the drawee will, upon presentment, accept it, and that he will pay it according to its tenor, and that if he fails to do so, the drawer will, upon proper notice, pay the amount of the bill himself. This state of law and fact implies that it is the duty of the holder at some time to present it to the drawee for acceptance.

This need not usually be done immediately, but, before it is presented for acceptance, it may be, and frequently is, passing from hand to hand, and, if the drawer is beyond question good and responsible, it may pay for half the goods in a commercial city before it be really presented for accept

ance.

One of the first enquiries a holder of a bill of exchange would be likely to make should be, in what cases an acceptance must be applied for and either obtained or refused, and in what cases it may or may not be at his election.

It is obvious that where the bill is payable by its terms, so many days "after sight," or after demand, the only mode of determining the time of payment is by presenting for accept

ance.

Those are the only cases in which presentment for acceptance is necessary.

If payable at a specified day, or so many days after date, the holder, if he does not wish to add to the strength of his

bill by the name of the acceptor, may hold it till it becomes payable, and then present it for payment. Of course he may, in all cases, present and demand acceptance, or refusal to accept, and, as the marketable value of the bill is increased by having on it the name of the party who is to be primarily liable, it will generally be done.

On presentment for acceptance, the drawee should, before accepting, satisfy himself that the handwriting of the drawer is not a forgery, as he is bound to know the signature of his commercial correspondent, and his acceptance precludes him from denying the genuineness of the drawer's signature, and, unless he chooses or expects to become an accommodation acceptor, that he has sufficient funds of the drawer in his hands to meet the draft.

If he has sufficient funds, and they are due and payable to the drawer, he is still not bound to accept, unless he has agreed to do so, and no action lies against him for a refusal, unless he has received the funds for that purpose or expressly agreed so to do. A promise to accept is equivalent to an acceptance, in fixing the liability of the party so agreeing, where such promise sufficiently describes and identifies the bill, and the party calling for an acceptance has been advised of the promise and has purchased the bill upon the faith of it. The bill must, however, be drawn and presented within a reasonable time after the promise is made.

An acceptance may be by parol and become binding, but is inconvenient and troublesome in the proof, and it should be, and usually is, in writing, across the face of the bill.

It may be general or special. If special, (as if accepted payable at a particular place), it only binds the acceptor according to its terms. Any qualified or special acceptance, varying the sum, or time or place of payment, the holder is not bound to accept, but, if he does accept it, he must conform to it.

Any act, the natural and reasonable effect of which is, to give credit to the bill, will be treated as amounting to an acceptance; as, a retention of it, without explanation, for an unreasonable time.

So, it would be deemed accepted if the drawee should destroy the bill, or refuse to return it.

When once an acceptance is made, the acceptor becomes the principal debtor, and all other parties, including the drawer, are in the light of sureties or endorsers, and while all the others may be discharged by any of the acts, which have been named as sufficient to discharge an endorser, the acceptor can be discharged only by payment, or a release. He is bound to a purchaser in good faith, though he accepted for the accommodation of the drawer and without consideration.

Though the acceptor is bound to know the signature of the drawer, he is not necessarily acquainted or presumed to be so, with the handwriting of the body of the instrument, and he may be permitted to prove that that is a forgery.

If acceptance be refused, notice should be given as in case of non-payment, but the bill should be retained and again presented for payment, for it cannot be known that the acceptor may not in the meantime have received funds and be ready and willing to pay.

SECTION 8.

Form of Protest for Non-Payment:

United States of America.

State [or "Commonwealth" in Mass. or Virginia.] of

I

On the

ing in the

day of , A. D.

, at the request of

SS.

a Notary Public, duly admitted and sworn, dwellof did present the original bill, [or note] which is hereto annexed, and demanded payment thereof, which was refused. I therefore, on the same day and year above written, and after said demand and refusal, duly notified the drawer and the several endorsers, of the non-payment, as follows:

By serving personally a notice on
Street, in the

of

By leaving at the place of residence of

Street, in the

of

, at his office, No.