Garwood v. Simpson

Burnett, J., after stating the facts, delivered the opinion of the Court—Terry, J., concurring. The first question arising under the state of facts in this case, is, whether the order was a negotiable instrument at the time it was executed by Carsen & Yance. It is objected that it was not a bill of exchange, because there was no sum certain stated, and it was payable out of a particular fund, and not generally.

It is well settled by all the authorities, that the first and principal requisite of a bill of exchange, is, that it must be for the payment of money only, and for a named sum certain. (Chitty on Bills, 132, 133.) And it would seem clear in this case, that although the order was drawn payable to Tomlinson or order, still, before he presented it for acceptance, ho could not have transferred it as a negotiable instrument. If it had been a bill of exchange, then, upon presentation and refusal to accept, a protest and notice would have been necessary to fix the liability. of the drawers.

It is true, that a promissory note, or a bill of exchange, will be good when a blank is left for the sum, and that blank is filled up by the party to whom it is given. But this order is a very different instrument. Here the holder was not authorized, before negotiation, to state the sum for which the bill was drawn. This was not left discretionary with him, and yet it was not set-[105]tied by the order itself. When a bill is executed and delivered by the drawer, with a blank left for the sum, or time when payable, these matters are not certain, but the power to make them certain, is given to the holder. In this case, Tomlinson could not assign the order before it was accepted, and the sum ascertained. (4 Doug., 9; 26 Eng. Com. Law, 193; 22 Pick., 83.) The legal effect of this order was an assignment of the particular fund mentioned to Tomlinson. (5 Paige, 632; 6 Barbour, 182.)

But conceding that the order was not negotiable when drawn, was the conduct of the defendant such as to make a transfer of the instrument by Tomlinson to an innocent purchaser, without notice, binding upon the defendant ?

The legal effect of the order being an assignment by Carsen & Vance of the particular fund to Tomlinson, the moment the order was accepted, and a certain sum was endorsed upon the order, that moment the debt became one from Simpson to Tomlinson, and the condition of Carsen & Vance, in respect to Tomlinson, was the same as if Simpson & Jackson had actually paid over the money to Tomlinson. Carsen & Vance had, doubtless, drawn this order in favor of Tomlinson, either as a conditional payment, or loan, and, when Tomlinson accepted the endorsment of Simpson, in lieu of the money, he necessarily released Carsen & Vance from any obligation to him. The debt then became a debt for a sum certain, due from Simpson to Tomlinson, or order, payable on demand. The legal effect of the endorsement of Simpson upon the order, was to incorporate the terms of the order with the endorsement, and upon the delivery of both to Tomlinson, the instrument became a direct and original undertaking on the part of Simpson to pay to Tomlinson, or order, the sum of money stated.