Definition of INDORSEMENT


INDORSEMENT

contracts. In its most general acceptation, it is
what is written on the back of an instrument of writing, and which
has relation to it; as, for example, a receipt or acquittance on a
bond; an assignment on a promissory note.

2. Writing one s name on the back of a bill of exchange, or a
promissory note payable to order, is what is usually called, an
indorsement. It will be convenient to consider, 1. The form of an
indorsement; and, 2. Its effect.

3. - 1. An indorsement is in full, or in blank. In full, when
mention is made of the name of the indorsee; and in blank, when the
name of the indorsee is not mentioned. Chitty on Bills, 170; 13
Serg. & Rawle, 315. A blank indorsement is made by writing the name
of the indorser on the back; a writing or assignment on the face of
the note or bill would, however, be considered to have the force
and effect of an indorsement. 16 East, R. 12. when an indorsement
has been made in blank any after attempt to restrain the
negotiability of the bill will be unavailing. 1 E.N. P. C. 180; 1
Bl. Rep. 295; Ham. on Parties 104.

4. Indorsements may also be restrictive conditional, or
qualified. A restrictive indorsement may restrain the negotiability
of a bill, by using express words to that effect, as by indorsing
it "payable to J. S. only," or by using other words clearly
demonstrating his intention to do so. Dougl. 637. The indorser may
also make his indorsement conditional, and if the condition be not
performed, it will be invalid. 4 Taunt. Rep. 30. A qualified
indorsement is one which passes the property in the bill to the
indorsee, but is made without responsibility to the indorser; 7
Taunt. R. 160; the words commonly used are, sans recours, without
recourse. Chit. on Bills, 179; 3 Mass. 225; 12 Mass. 14, 15.

5. - 2. The effects of a regular indorsement may be considered,
1. As between the indorser and the indorsee. 2. Between the
indorser and the acceptor. And, 3. Between the indorser and future
parties to the bill.

6. - 1. An indorsment is sometimes an original engagement;as,
when a man draws a bill payable to his own order, and indorses it;
mostly, however, it operates as an assignment, as when the bill is
perfect, and the payee indorses it over to a third person. As an
assignment, it carries with it all the rights which the indorsee
had, with a guaranty of the solvency of the debtor. This guaranty
is, nevertheless, upon condition that the holder will use due
diligence in making a demand of payment from the acceptor, and give
notice of non-acceptance or non-payment. 13 Serg. Rawle, 311.

7.-2. As between the indorsee and the acceptor, the indorsement
has the effect of giving to the former all the rights which the
indorser had against the acceptor, and all other parties liable on
the bill, and it is unnecessary that the acceptor or other party
should signify his consent or knowledge of the indorsement; and if
made before the bill is paid, it conveys all these rights without
any set-off, as between the antecedent parties. Being thus fully
invested with all the rights in the bill, the indorsee may himself
indorse it to another when he becomes responsible to all future
patties as an indorser, as the others were to him.

8. - 3. The indorser becomes responsible by that act to all
persons who may afterwards become party to the bill.
Vide Chitty on Bills, ch. 4; 3 Kent, Com. 58; Vin. Abr.
Indorsement; Com. Dig. Fait, E 2; 13 Serg. & Rawle, 311; Merl.
Rpert. mot Endossement Pard. Droit Com. 344-357; 7 Verm. 356; 2
Dana, R. 90; 3 Dana, R. 407; 8 Wend. 600; 4 Verm. 11; 5 Harr. &
John. 115; Bouv. Inst. Index, h. t.

Source: Bouviers Law Dictionary 1856 Edition

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