The Washburn leader. [volume] (Washburn, McLean County, N.D.) 1890-1986, 1914-07-10

stance.
If l am hiring Regan the contractor
to build my house and we fall out e
our agreement the court will consider
every possible point connected with
the transaction in order to determine
what our mutual intentions really were.
But If l employ Regan to do the work
and. give him a promissory note in
payment Of his services, our rights. so
far as that note is concerned, are large
~ determined by the exact form in
which l issued it. taken in connection
of course with the subsequent indorse-
ments-that is, whatever written ad-
ditions were afterward made to it in
the course of business.
The vital feature Of bills Of exchange
or drafts, as they are generally called
-promissory notes and bank checks is
their negotiability-that Is to say, they
are a special class Of contracts which
are SO framed and so favored by the
law that If certain rules are adhered to
they can be passed from man to man
quite as freely and far more conven-
iently than actual cash.
An ordinary contract may be assign
ed or transferred from one to another.
Thus If l have agreed to furnish a
large factory with knitting machines I
may assign my right to be paid for
doing so to Bogardus for a valuable
consideration. Suppose, though, that l
misrepresented some important feature
Of my knitting machines to the Sue
cess Textile company. which ordered
them. and after have transferred my
rights in the contract to Bogardus they
find 1t out. Under such circumstances
the textile company can employ the de-
Tense of misrepresentation against b.
gardus just as readily as they could
against me. for he has simply stepped
into my shoes and is in no better posi-
ton than l would be had I remained a
party to the contract.
Now, this is Just where drafts. notes
and bills. u, as they are often called
collectively, negotiable instruments or
commercial paper. differ radically from
other contracts. While still In the
hands of the original parties who gave
them birth they are subject to any de-
lenses which one may have against the
other. so that If Curzon gives a prom
issory note for 500. due in sixty days.
to Plaisted and. then finds that through
mutual dealings Plaisted really owes
him $500 he may at the end Of the SIX
ty days refuse to pay Plaisted the note
and demand instead $500 from him.
Suppose. however, that Plaisted has
meanwhile sold the note to Rangely.
who knows nothing of his debt to Cur
zon, can Curzon still set of Plaisted's
debt and refuse to pay Rangely the
note? Undoubtedly he cannot do SO.
Such a case illustrates the distin-
gushing characteristic Of commercial
paper. Like a bird which has flown
from the parent nest, it is freed from
any defenses which the original parties
to It may have, just as soon as 1t has
been purchased, in good faith and for q
person. -
In every other form Of contract the
rule is otherwise: land bears it's bur
dens from owner to owner. the as
signed mortgage conveys no better title
to the purchaser than the assignor had
to give; but for the purely practical
reason that in trade there. must be
some convenient representative Of spe-
Gle, which may pass from hand to hand
40 readily as actual coin, a general
agreement and strength Of custom
among merchants bred the three forms
Of credit paper-the bill Of exchange.
the promissory note and the bank check
ali Of which. travel,st in the words OF q
great jurist. 40 lcouEiers without lug
gage, and to all Of which an Innocent
purchaser. for value. gets an absolutely
clear title.-saturday Evening Post.