BAN I( NOTE. A promissory note, payable on demand to the bearer, made and issued by a person or persons acting as bankers and authorized by law to issue such notes. The definition is confined to notes issued by in corporated banks in 2 Dan. Neg. Inst. § 1664. See 2 Pars. Bills & N. 88. Bank bills and bank notes are equivalent terms, even in criminal cases ; Eastman v. Com., 4 Gray (Mass.) 416. The power thus to issue is not inherent or essential in banking business, and is not necessarily implied from the con ference of a general power to do banking business. It must be distinctly, and in terms conferred in the incorporating act, or it will not be enjoyed- Morse, Banking, c. viii.; 11 Op. Att.-Gefi. 334.
The notes of national banks have supplant ed those of state banks at the present time.
For many purposes they are not looked upon as common promissory notes, and as mere evidences of debt. In the ordinary transactions of business they are recognized by general consent as cash. The business of issuing them being regulated by law, a cer tain credit attaches to them, that renders them a convenient substitute for money ; Smith v. Strong, 2 Hill (N. Y.) 241. They may be reissued after payment ; Chaim. Bills of Exch. 267.
The practice is, therefore, to use them as money ; and they are a good tender, unless objected to; Snow v. Perry, 9 Pick. (Mass.) 542; Jeffeison County Bank v. Chapman, 19 Johns. (N. Y.) 322; Felter v. Weybright, 8 Ohio 169; Hoyt v. Byrnes, 11 Me. 475; Ball v. Stanley, 5 Yerg. (Tenn.) 199, 26 Am. Dec. 263 ; Seawell v. Henry, 6 Ala. 226; 5 Dowl. & R. 289. They pass under the word "mon ey" in a will, and, generally speaking, they are treated as cash ; Mechanics' & Farmers' Bank v. Smith, 19 Johns. (N. Y.) 115; but see Armsworth v. Scotten, 29 Ind. 495, as to their receipt by a sheriff in payment of an execution. When payment is made in bank notes, they are treated as cash and receipts are given as for cash; Morris v. Edwards, 1 Ohio 189; Edwards v. Morris, 1 Ohio 524; Morrill v. Brown, 15 Pick. (Mass.) 177; Bradley v. Hunt, 5 G. & J. (Md.) 54, 23 Am. Dec. 597; Governor v. Carter, 10 N. C. 328, 14 Am. Dec. 588; Scott v. Com., 5 J. J. Marsh. (Ky.) 643; 1 Sch. & L. 318, 319; Tancil v. Seaton, 28 Gratt. (Va.) 605, 26 Am. Rep. 380; 1 Burr. 452. It has been held that the pay ment of a debt in bank notes discharges the debt ; Bayard v. Shunk, 1 W. & S. (Pa.) 92, 37 Am. Dec. 441; Pearson v. Gayle, 11 Ala. 280; 2 Dan. Neg. Inst. § 1676; Edmunds v. Digges, 1 Gratt. (Va.) 359, 42 Am. Dec. 561; but not when the payer knew the bank was insolvent. The weight of authority is against the doctrine of the extinguishment of a debt by the delivery of bank notes which are not paid, when duly presented, in reason able time. But it is undoubtedly the duty of
the person receiving them to present them for payment as soon as possible; Gilman v. Peck, 11 Vt. 516, 34 Am. Dec. 702 ; Fogg v. Sawyer, 9 N. H. 365 ; President, etc., of Bank of U. S. v. Bank, 10 Wheat. (U. S.) 333, 6 L. Ed. 334; Young v. Adams, 6 Mass. 182; Houghton v. Adams, 18 Barb. (N. Y.) 545; Westfall, Stewart & Co. v. Braley, 10 Ohio St. 188, 75 Am. Dec. 509; Frontier Bank v. Morse, 22 Me. 88, 38 Am. Dec. 284; Townsends v. Bank, 7 Wis. 185 ; 6 B. & C. 373.
Bank notes are governed by the rules ap plicable to other negotiable paper. They are assignable by delivery; Rep. t. Hard. 53; President, etc., of Michigan State Bank v. Hastings, 1 Dougl. (Mich.) 236, 41 Am. Dee. 549. The holder of a note is entitled to payment, and cannot be affected by the fraud of a former holder, unless be is proved privy to the fraud; 1 Burr. 452; Sylvester v. Gi rard, 4 Rawle (Pa.) 185; Worcester County Bank v. Bank, 10 Cush. (Mass.) 488, 57 Am. Dec. 120; 2 Dan. Neg. Instr. § 1680; Olm stead v. Bank, 32 Conn. 278, 85 Am. Dec. 260. The bona fide holder who has received them for value is protected in their possession even against a real owner from whom they have been stolen. Payment in forged bank notes is a nullity ; Pindall's Ex'rs v. Bank, 7 Leigh (Va.) 617 ; Hargrave v. Dusenberry, 9 N. C. 326; Ramsdale v. Horton, 3 Pa. 330; Eagle Bank of New Haven v. Smith, 5 Conn. 71, 13 Am. Dec. 37; but the taker of such must give prompt that they are coun terfeit, and offer to return them; Simms v. Clark, 11 Ill. 137. But where the bank itself receives notes purporting to be its own, and they are forged, it is otherwise ; President, etc., of Bank of U. S. v. Bank, 10 Wheat. (U. S.) 333, 6 L. Ed. 334. See 6 B. & C. 373. If a note be cut in two for transmission by mail, and one half be lost, the bona fide hold er of the other half can recover the whole amount of the note ; Hinsdale v. Bank, 6 Wend. (N. Y.) 378; Bank of Virginia v. Ward, 6 Munf. (Va.) 166 ; Farmers' Bank of Virginia v. Reynolds, 4 Rand. (Va.) 186; Dan. Neg. Inst. § 1696.
At common law, as chosen in action, bank notes could not be taken in execution ; 9 Cro. Eliz. 746. The statute laws of the several states, or custom, have modified the common law in this respect, and in many of them they can be taken on execution ; Spencer v. Blaisdell, 4 N. EL 198, 17 Am. Dec. 412 ; Mor rill v. Brown, 15 Pick. (Mass.) 173; Lovejoy v. Lee, 35 Vt. 430.