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1101; Moak v. Stevens, (1904) 45 Misc. 147, 91 N. Y. S. 903; Poess v. Twelfth Ward Bank, (1904) 43 Misc. 45, 86 N. Y. S. 857. Moreover, if the instrument is negotiable in form, under section 50, consideration for the delivery is presumed.

As between the immediate parties, the presumption of delivery may be rebutted. Cowee v. Cornell, (1878) 75 N. Y. 91, 31 Am. Rep. 428.

Delivery to wrong person.-A note which is delivered to the wrong person through a mistake of fact as to his personality and is accepted by such person fraudulently with knowledge of the mistake, is void in its inception. Bergmann v. Salmon, (1894) 79 Hun 456, 29 N. Y. S. 968, affirmed on opinion below (1896) 150 N. Y. 575, 44 N. E. 1121.

Proof of conditional delivery of instrument. As against one who is not a holder in due course of a negotiable instrument, the maker may show that the instrument was delivered by him upon some condition which has not been performed. The proof of the condition is not an oral contradiction of the written obligation, and thus parol evidence is generally admissible to that end. Niblock v. Sprague, (1911) 200 N. Y. 390, 93 N. E. 1105; Bookstaver v. Jayne, (1875) 60 N. Y. 146; Benton v. Martin, (1873) 52 N. Y. 570. "The manual transfer of an instrument, in form a complete contract, does not, however, bar parol evidence that it is not to become binding until the happening of some condition precedent resting in parol, or that the transfer is for a special purpose. . . . It is a question of fact whether any written agreement, though in possession of the obligee, has been delivered by the obligor as a binding agreement, or whether any delivery that has been made is conditional only." Grannis v. Stevens, (1916) 216 N. Y. 583, 111 N. E 263, affirming 157 App. Div. 561, 142 N. Y. S. 835.

Different condition than stated in writings.-" While it is admissible to prove a conditional delivery of notes and drafts for the purpose of showing that they never became complete obligations because of non-performance of conditions precedent, still, when the parties themselves reduce to writing in documents separate from the notes or drafts the conditions under which the notes or drafts are delivered, they will not be permitted to vary the terms of those writings by showing alleged oral agreements contradicting them." Banque Franco-Americaine v. Bergstrom, (1916) 171 App. Div. 870, 157 N. Y. S. 635.

Courts suspicious as to defense of conditional delivery.-While evidence is admissible to show that a written paper which is in form a complete contract was nevertheless not to become a binding contract until the performance of some condition precedent resting in parol, yet the defense is subject to suspicion, and the rule should be cautiously applied to avoid mistake or imposition and strictly confined to cases clearly within its reason. Reynolds v. Robinson, (1888) 110 N. Y. 654, 18 N. E. 127.

Conditional delivery as against holder in due course. The fact that a note was delivered upon a condition is no defense as against a holder in due course; and, when there is a dispute as to whether the holder had knowledge of the condition for which it was delivered, the issue is for the jury. Senft v. Schaefler, (1913) 81 Misc. 152, 142 N. Y. S. 380.

Certificate of deposit.-A certificate of deposit issued by a bank is one of the class of instruments of which the statute declares that the delivery "may be shown to have been conditional or for a special purpose only and not for the purpose of transferring the property in the instrument." Matter of Marine, (1912) 78 Misc. 707, 140 N. Y. S. 231.

Condition as to place of negotiation.—As against one not a holder in due course, an accommodation indorser of an instrument may show that he indorsed and delivered the instrument on the condition that it should be negotiated only in a certain state. United States Nat. Bank v. Ewing, (1892) 131 N. Y. 506, 30 N. E. 501, 27 A. S. R. 615.

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Condition that party shall not be liable.-As against one not a holder in due course of an instrument, a maker or indorser may show that he signed or indorsed the note without consideration, and that he delivered it to the holder on the condition that he should not be liable thereon. Higgins v. Ridgway, (1897) 153 N. Y. 130, 47 N. E. 32; English v. Schlesinger, (1907) 55 Misc. 584, 105 N. Y. S. 989.

An arrangement between a bank discounting a note and an accommodation indorser thereof that the indorser shall not be liable on the instrument, is a defense in an action thereon by the bank against the indorser. Persons v. Hawkins, (1899) 41 App. Div. 171, 58 N. Y. S. 831; Simmons v. Thompson, (1898) 29 App. Div. 559, 51 N. Y. S. 1018.

It is a good defense in an action against the indorser of a note that it was agreed that the indorser was not to be personally liable thereon, but that the note should be paid out of the proceeds of a sale of certain stock; and the defense is good as against a transferee of the obligation who is not a holder for value. Carpenter v. Hoadley, (1910) 138 App. Div. 190, 123 N. Y. S. 61, affirmed without opinion (1911) 203 N. Y. 571, 96 N. E. 1111.

Although there is an arrangement between the maker and the payee that the maker shall not be liable to the payee, if the maker signs the note as an accommodation party so as to enable the payee to procure credit from another, the maker is liable to the transferee of the note, though the transferee has knowledge of the condition. English v. Schlesinger, (1907) 55 Misc. 584, 105 N. Y. S. 989. See also Garfield Nat. Bank v. Colwell, (1890) 57 Hun 169, 10 N. Y. S. 864. See infra, § 55, as to the liability of an accommodation party. Subsequent attachment of condition.-After the giving of a note, the maker cannot attach a condition thereto so as to make him liable only on a contingency. Beaudrias v. Curtis, (1892) 17 N. Y. S. 708.

Allegation of delivery. An allegation that a certain promissory note was made by a defendant is equivalent to an allegation, and imports not only that it was signed, but that it was delivered to take effect as a negotiable instrument. Pittsburgh First Nat. Bank v. Stallo, (1914) 160 App. Div. 702, 145 N. Y. S. 747. And see to the same effect, Odell v. Clyde, (1898) 38 App. Div. 333, 57 N. Y. S. 126, affirming 23 Misc. 734, 53 N. Y. S. 61.

Cited.-Yonkers Nat. Bank v. Mitchell, (1913) 156 App. Div. 318, 141 N. Y. S. 128; Hoag v. Wright, (1898) 34 App. Div. 260, 54 N. Y. S. 658; Colborn v. Arbecam, (1907) 54 Misc. 623, 104 N. Y. S. 986; Frey v. Horton, (1903) 85 N. Y. S. 402.

§ 36. Construction where instrument is ambiguous. Where the language of the instrument is ambiguous, or there are omissions therein, the following rules of construction apply:

1. Where the sum payable is expressed in words and also in figures and there is a discrepancy between the two, the sum denoted by the words is the sum payable; but if the words are ambiguous or uncertain, references may be had to the figures to fix the amount;

2. Where the instrument provides for the payment of interest, without specifying the date from which interest is to run, the interest runs from the date of the instrument, and if the instrument is undated, from the issue thereof;

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3. Where the instrument is not dated, it will be considered to be dated as of the time it was issued;

4. Where there is a conflict between the written and printed provisions of the instrument, the written provisions prevail;

5. Where the instrument is so ambiguous that there is doubt whether it is a bill or note, the holder may treat it as either at his election;

6. Where a signature is so placed upon the instrument that it is not clear in what capacity the person making the same intended to sign, he is to be deemed an indorser;

7. Where an instrument containing the words "I promise to pay " is signed by two or more persons, they are deemed to be jointly and severally liable thereon.

This section was derived from the Negotiable Instruments Law of 1897, § 36.

Conflict between written and printed parts of instrument.— In Miller v. Hannibal, etc., R. Co., (1882) 90 N. Y. 430, 43 Am. Rep. 179, the principles relative to a repugnancy between the written and printed parts of an instrument were stated as follows: "It is no doubt a principle of construction that in case of repugnancy between written and printed clauses of an instrument, the written will prevail over the printed. But this is a rule which is only resorted to from necessity, when the printed and written clauses cannot be reconciled, and in that respect is like the rule applied in the construction of wills where two clauses are repugnant and irreconcilable, in which case the first will be rejected, and the subsequent clause will be regarded as indicating the final intention in the absence of any other clue to the interpretation. . . . But it is the imperative duty of the courts to give effect if possible to all the terms of an agreement. The construction is to be made upon consideration of the whole instrument, and not upon one or more clauses detached from the others; and this principle applies as well to instruments partly printed and partly written, as to those wholly printed, or wholly written. Where two clauses apparently repugnant may be reconciled by any reasonable construction, as by regarding one as a qualification of the other, that construction must be given, because it cannot be assumed that the parties intended to insert inconsistent provisions."

“I promise to pay."— Prior to the enactment of the Negotiable Instruments Law, it was generally held that a note containing the words, "I promise to pay," and signed by two or more persons, was the joint and several note of such signers. National Surety Co. v. Seaich, (1916) 171 App. Div. 414, 157 N. Y. S. 422; Partridge v. Colby, (1855) 19 Barb. 248; Ely v. Clute, (1879) 19 Hun 35; Coonley v. Wood, (1885) 36 Hun 559.

Interest.-.Subdivision 2 refers to the computation of interest when there is an agreement to pay interest, but does not apply where the instrument does not provide for interest. Van Vliet v. Kanter, (1910) 139 App. Div. 603, 124 N. Y. S. 63.

Cited. Didato v. Cornigli, (1906) 50 Misc. 280, 100 N. Y. S. 466.

8 37. Liability of person signing in trade or assumed name. No person is liable on the instrument whose signature does not appear thereon, except as herein otherwise expressly provided.

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But one who signs in a trade or assumed name will be liable to the same extent as if he had signed in this own name.

This section was derived from the Negotiable Instruments Law of 1897, § 37.

Signature by agent: see infra, § 38. Liability of agent: see infra, § 39. Fictitious firm names prohibited: see PARTNERSHIP LAW, § 22. Conducting business under assumed name: see PENAL LAW, § 440.

Liability confined to parties to instrument.- "Whatever may be the rule as to other contracts, not under seal, the law is firmly established in this state as to commercial paper that persons dealing with negotiable instruments are presumed to take them on the credit of the parties whose names appear upon them, and a person not a party cannot be charged upon proof that the ostensible party signed or indorsed as his agent. The rights of the holder are confined to the parties to the instrument, and he must rely upon them alone, except that he can establish that the name used as the signature to the instrument has been adopted by the assumed principal or by the person not named in the instrument as his own in transacting the business." Manufacturers', etc., Bank v. Love, (1897) 13 App. Div. 561, 43 N. Y. S. 812. And see obiter to the same effect in Briggs v. Partridge, (1876) 64 N. Y. 357, 21 Am. Rep. 617.

"There is no doubt that a person may draw, accept or indorse a bill by his agent or attorney, and that it will be as obligatory upon him as though done by his own hand. But the agent in such case must either sign the name of the principal to the bill, or it must appear on the face of the bill, in some way or another, that it was in fact drawn for him, or the principal will not be bound. The particular form of the execution is not material, if it be substantially done in the name of the principal. Pentz v. Stanton, (1833) 10 Wend. 270, 25 Am. Dec. 558.

Certificate of stock.-A certificate of stock is not a negotiable instrument within the meaning of the Negotiable Instruments Law, and is not governed thereby. Cowles v. Kiehel, (1899) 65 N. Y. S. 349. See supra, § 20, as to what instruments are within the purview of the Negotiable Instruments Law. Damages. The question of the damages recoverable in an action upon a bill of exchange is controlled by the law merchant, not by any provision of the Negotiable Instruments Law. Pavenstedt v. New York Life Ins. Co., (1911) 203 N. Y. 91, 96 N. E. 104, Ann. Cas. 1913A 805.

Not payable to assumed name.-Where, in a note given for a valuable consideration, the name of the payee is an assumed business name, it is no defense that the payee is a fictitious company, but the person transacting business under such assumed name may enforce the obligation by a suit in his own name with appropriate allegations relative to the assumed name. Jones v. Home Furnishing Co., (1896) App. Div. 103, 41 N. Y. S. 71.

Fictitious name.-"A person may become a party to a bill or note, by any mark or designation he chooses to adopt, provided it is used as a substitute for his name, and he intends to be bound by it." Dewitt v. Walton, (1854) 9 N. Y. 571.

Firm name." If a copartnership name has been agreed upon, it must be used in order to bind the firm, but if none has been agreed upon a name that fairly represents the company may be adopted, and, by custom and use, become its valid name." Meriden Nat. Bank v. Gallaudet, (1890) 120 N. Y. 298, 24 N. E. 994.

Where one partner signs or indorses the firm name on commercial paper for matters outside of the partnership business, the firm is not generally bound; but when the other members have knowledge of the continued and persistent conduct of one member in lending the credit of the firm by means of accommodation paper and do not condemn the unauthorized acts and seek judicial

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redress, they will be deemed to acquiesce in it; and, if innocent third persons have been led thereby to put themselves in a position from which they cannot be taken without loss if the act were held invalid, the other partners will be estopped from questioning it. Monongahela Valley Bank v. Weston, (1902) 172 N. Y. 259, 64 N. E. 946.

A note signed in the name of a partnership by one member of the firm, but given in payment of or to secure an individual liability of such member, is not enforceable against the other members of the firm, if the holder had knowledge of the facts. Van Voorhis v. Brown, (1898) 29 App. Div. 119, 51 N. Y. S. 440. And see infra, section 95, as to the rights of a holder in due course of an instrument issued in a firm name by one party without authority. See also infra, section 55, as to accommodation indorsements by partnerships.

§ 38. Signature by agent; authority; how shown. The signature of any party may be made by a duly authorized agent. No particular form of appointment is necessary for this purpose; and the authority of the agent may be established as in other cases of agency.

This section was derived from the Negotiable Instruments Law of 1897, 8 38.

Liability of person signing in trade or assumed name: see supra, § 37. Liability of agent signing instrument: see infra, § 39. Indorsement of instrument payable to cashier of bank: see infra, § 72. Indorsement in representative capacity: see infra, § 74.

Filing statement of agency by agent: see PENAL LAW, § 140. Relief of principal from liability for future acts of agent: see PENAL LAW, § 143.

Authority of agent strictly interpreted.—“An authority to make or indorse negotiable paper is subject to strict interpretation, and must be pursued strictly. The power will be construed as extending only to paper executed or indorsed in the business of the principal and for his benefit. . . . It is well settled that one who takes a negotiable note, purporting to be made by an agent, is bound to inquire as to the power of the agent. . . . Third parties cannot rely upon the agent's mere assumption of authority. In dealing with an avowed agent, they are put upon their guard by the very fact. Where the agent transcends the limits of his authority, and the person with whom he deals has notice of this sufficient to put him upon inquiry, he cannot charge the principal." Eldridge v. Husted, (1898) 24 Misc. 177, 52 N. Y. S. 681, reversing 22 Misc. 534, 49 N. Y. S. 1019.

Necessity that name of principal appear.- Before the enactment of the Negotiable Instruments Law, it was generally held that a person was not liable as a party to a negotiable instrument, unless his name appeared on the⚫ instrument. The signature of a duly authorized agent, with the name of the principal, was thought to be insufficient to hold the principal. Briggs v. Partridge, (1876) 64 N. Y. 357, 21 Am. Rep. 617; Manufacturers', etc., Nat. Bank v. Love, (1897) 13 App. Div. 561, 43 N. Y. S. 812; Pentz v. Stanton, (1833) 10 Wend. 271, 25 Am. Dec. 558. See also Casco Nat. Bank v. Clark, (1893) 139 N. Y. 307, 34 N. E. 908, 36 A. S. R. 705; Dewitt v. Walton, (1854) 9 N. Y. 571; Cortland Wagon Co. v. Lynch, (1894) 82 Hun 173, 31 N. Y. S. 325. And see supra, § 37.

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Descriptive designation of principal. Where the name of an agent was subscribed to an instrument with the addition of the words agent for the Churchman," it was thought that the words quoted were merely descriptive, and the Churchman was not bound by the signature. Dewitt v. Walton, (1854) 9 N. Y. 571.