It does not render the note non-negotiable; Page v. Ford (Or.) 131 Pac. 1013; Neg. Instr. Act § 135.
A restrictive indorsement is one which re strains the negotiability of the instrument to a particular person or for a particular pur pose; Hermann v. Bank, 1 Rob. (La.) 222. Such are "Pay A. B. or order, for my use," or "for my account," or "only." Neg. Instr. Act § 132, 1$3, 134.
By the law merchant, bills and notes pay able to order can be transferred only by in dorsement ; Russell v. Swan, 16 Mass. 314 ; Humphreyville v. Culver, 73 Ill. 485 ; Haber sham v. Lehman, 63 Ga. 380; Central Trust Co. v. Bank, 101'U. S. 68, 25 L. Ed. 876 ; Os good's Adm'rs v. Artt, 17 Fed. 575 ; Sto. Prom. N. § 120; Hatch v. Barrett, 34 Kan. 223, 8 Pac. 129. Indorsement is not complete before delivery of the note; Dann v. Norris, 24 Conn. 333; Spencer v. Carstarphen, 15 Colo. 445, 24 Pac. 882.
Delivery means transfer of possession, ei ther actual or constructive, from one person to another. Neg. Instr. Act § 124. Hence the word indorsee in a declaration on a bill imports a delivery ; Wood's Byles, Bills § 153.
An instrument promising to pay a sum certain with interest, as per annexed cou pons, reciting that note and coupons were secured by mortgage, was negotiable ; but an indorsement, "for value received, we here by assign and transfer the within bond, to gether with all our interest in, and rights under the same, without recourse," was not a commercial indorsement, but a mere as signment passing an equitable interest sub ject to the defences of the makers, and the negotiability of the instrument was thereby destroyed, and the subsequent indorsement of the transferee did not make him liable for payment in the absence of any independ ent contract; De Hass v. Roberts, 59 Fed. 853.
When, by such an assignment, the legal title is left in the payee, the equitable inter est merely passing to the transferee, it nec essarily follows that the negotiable character of the instrument is destroyed; Aniba v. Yeomans, 39 Mich. 171. And a subsequent indorsement by the transferee does not, in the absence of a special contract, render him liable ; Dan. Neg. Inst. 666 ; Gray v. Dona
hoe, 4 Watts (Pa.) 400; Citizens' Nat. Bank v. Piollet, 126 Pa. 194, 17 Atl. 603, 4 L. R. A. 190, 12 Am. St. Rep. 860. The indorsement of a non-negotiable note without proof of a special contract to become responsible means nothing and creates no liability; Fear v. Dunlap, 1 G. Greene (Ia.) 334; Dan. Neg. Inst. 709. See also Graham v. Wilson, 6 Kan. 489 ; Story v. Lamb, 52 Mich. 525, 18 N. W. 248; First Nat. Bank of Trenton v. Gay, 71 Mo. 627. The person making such indorsement guaranties the note to be gen uine, and that it is what it purports to be ; nothing more. He does not guaranty its payment, although he might do this by inde pendent contract expressed in the contract or otherwise; Fear v. Dunlap, 1 G. Greene (Ia.) 334.
The effect of the indorsement of a nego tiable promissory note or bill of exchange is to transfer the property in the note to the person mentioned in the indorsement when it is made in full; Brown v. McWhite, 30 S. C. 356, 9 S. E. 277; or, when made in blank, to any person to whose possession it may lawfully come thereafter even by mere de livery, so that the possessor may sue upon it in his own name at law, as well as if he had been named as the payee; Evans v. Gee, 11 Pet. (U. S.) 80, 9 L. Ed. 639 ; Seabury v. Hun gerford, 2 Hill (N. Y.) 80 ; Everett v. Tid ball, 34 Neb. 803, 52 N. W. 816 ; Howland v. Bates, 1 Misc. 91, 20 N. Y. Supp. 373 ; JoneS v. Shapers, 57 Fed. 457, 6 C. C. A. 423.
Any person who has possession of the in strument is presumed to be the legal bona fide owner for value, until the contrary is shown; Palmer v. Marshall, 60 Ill. 289.
The payee of a note can restrain its ne gotiability, but a subsequent indorser can revive its negotiable quality; Holmes v. Hooper, 1 Bay (S. C.) 160.
The parties are presumed to stand to each other in the relations in which their names appear. Where the holder has knowledge, the facts may be shown as between him and the other parties ; Whitehouse v. Hanson, 42 N. H. 9.