PROMISSORY NOTE ( from Lat. promissor, promiser, from prom it to promise. send ward. from pro, before. for -I-- In it tcre, to send. skt. mir, to push). A written instrument containing an express and unconditional promise by the maker to pay a certain sum in money. on demand. or at a fixed or determinable future time. If it is payable to order or to bearer, it is a negotiable instru ment (q.v.). The following is an ordinary forum of a negotiable promissory note, payable at a bank: "81000.00. New York, April I. 1903. Three months after date I promise to pay to the order of Richard Roe One Thousand Dollars, at the Corn Exchange Bank.
Value received, with interest. JOHN DoE." Had the words "at the Corn Exchange Bank" been omitted, the note mouhl have been payable at the maker's place of business or residence.
It will be ()IE.:en cd that the parties to a promis sory note arc maker and the payee. If the payee is named. as in the form given above. and the note is payable to his order, his indorsement of it is necessary to its negotia tion. Ile may sell and transfer it. without an indorsement: but his transferee in that ease will take it subjeet to any defenses available to the maker against him. The maker• promises abso Intely to pay the paper. Bence the holder is not bound to present it at the time and place named in the instrument, as a condition of suing the maker.
The earl• history of promissory notes is quite obscure. Their earliest appearanc•c in the re ported decisions of English courts is during the close of the seventeenth and the opening of the eighteenth century. For a time the judges seemed, disposed to follow mercantile usage and to treat them as negotiable instruments. With the accession of Lord Holt to the chief justiceship of the King's Bench, a change of judicial attitude became noticeable. He refused to recognize their negotiable character; and in 1704 l'a rliawent, siding with the merchants, enacted a statute (3 and 4 Anne, e. ix.) which declared that promis sory notes "shall have the same effect as inland bills of exchange." In some of the United States this statute has been looked upon as simply •deelara tory of the common law, while in others Lord IloIt's view has been accepted. Everywhere, however, certain forms of promissory notes are now deemed negotiable instruments.
In some States certain forms of notes are declared negotiable by statute which are not negotiable in the common-law sense. For further discussion, and for the liability of indorsers, re quirements as to presentation, etc., see such titles as BILL OF EXCHANGE; DEE BILL; „NEGOTIABLE