Contracts are not necessarily negotiable because by their terms they inure to the benefit of the bearer. Hence, a receipt ac knowledging that a person has received from another named so many shares of stock in a specified corporation, entitling the bearer to so many dollars in certain bonds to be issued, is not free in the hands of a transferee from equities which would have affected it in the hands of the original recipient; Chicago, R. I. & P. R. Co. v. Howard, 7 Wall. (U. S.) 392, 19 L. Ed. 117.
Indorsements of payment on a promissory note before delivery do not destroy negotia bility ; Smith v. Shippey, 182 Pa. 24, 37 Atl. 844, 38 L. R. A. 823.
The rule in Illinois that a negotiable note, secured by a mortgage, transferred to a bona fide holder before maturity, is held subject to all equities between the original parties, is not binding on the federal courts,' which hold in such cases that in a suit in equity brought to foreclose the mortgage, no other defences are allowed against it than would be allowed in an action at law to recover on the notes; Swett v. Stark, 31 Fed. 858. Cou pons attached to a railroad bond and payable to bearer, when detached and negotiated, are no longer incidents of the bond, but inde pendent negotiable instruments; Internal Imp. Fund v. Lewis, 34 Fla. 424, 16 South. 325, 26 L. R. A. 743, 43 Am. St. Rep. 209. See CouPoNs.
"By the decisive weight of authority in this country where negotiable paper has been put in circulation, and there is no infirmity or defence between the antecedent parties thereto, a purchaser of such securities is en titled to recover thereon, as against the maker, the whole amount, irrespective of what he may have paid therefor." Wade v. R. Co., 149 U. S. 327, 13 Sup. Ct. 892, 37 L. Ed. 755. See Fowler v. Strickland, 107 Mass. 552; Bange v. Flint, 25 Wis. 544; National Bk. of Michigan v. Green, 33 Ia. 140.
All the states, territories, etc., have passed the Uniform 'Negotiable Instruments Act, except California, Georgia, Maine, Missis sippi, Texas, and Porto Rico. Under this act an instrument, to be negotiable, must be in writing and signed; must contain an un conditional promise or order to pay a certain sum of money on demand at a fixed and de terminable future time; it must be payable to order or to bearer, and where it is ad dressed to the drawee, he must be named or otherwise indicated with reasonable certain ty ; its negotiability is not affected by the fact that it is not dated, or that it bears a seal, or that it does not specify the value given or that any value was given.
The sum payable is certain within the act, although it is to be paid with interest, or by stated instalments, with the provision that, upon default in the payment of any in stalment or interest, the whole sum becomes payable, or if payable with exchange or with costs of collection or an attorney's fee.
It may be payable to the order of a speci fied person, or to him, or his order. A note payable to the maker's order is not negotia ble till he endorses it. It may be payable to the holder of an office.
Negotiability is not affected if the instru ment authorizes the sale of collateral securi ty ; or a confession of judgment on default ; or waives the benefit of any law intended for the obligor's benefit; or gives the bolder an election to require something to be done in lieu of payment of money.
Warehouse receipts and bills of lading are said to be usually treated as only quasi ne gotiable instruments on the ground that they do not contain a sufficiently definite promise and are not payable in money ; Sel. Neg. Inst. § 34. In some states receipts issued by certain warehouse and storage companies are still negotiable, for the statute giving them negotiability was not repealed by' the Negotiable Instruments Act ; Hanover N. Bk. v. Trust Co., 148 N. Y. 612, 43 N. E. 72, 51 Am. St. Rep. 721. In Wisconsin warehouse receipts, bills of lading and railroad receipts are negotiable unless the words "not nego tiable" are plainly written, printed or stamp ed on the face of the instrument. A certifi cate of deposit payable to the order of the depositor is negotiable ; Birch v. Fisher, 51 Mich. 36, 16 N. W. 220 ; Pardee v. Fish, 60 N. Y. 265, 19 Am. Rep. 176; Johnson v. Hen derson, 76 N. C. 227.
A note promising to pay a certain sum "to be allowed at my decease," is negotiable ; Martin v. Stone, 67 N. H. 367, 29 Atl. 845; and one payable "sixty days after my death"; Crider v. Shelby, 95 Fed. 212; and one paya ble "on demand after my decease"; Bristol v. Warner, 19 Conn. 7.