it is immaterial whether the defendant's express authority as to the filling in of the blanks was followed or not, for the defendant, by leaving the blanks unfilled, undertook to be answerable for the note when it was filled up in the shape of a binding obligation. In short, the sending into the world of printed notes, with the blanks unfilled, seems to be regarded as a letter of credit for an indefinite sum, and it will not do to allow a person who does this to escape the consequence of his act to the prejudice of the public."38 The fact, however, that a blank has been filled in a manner other than that contemplated is a defense against the one so filling it,39 or against one taking the instrument with knowledge thereof.40 Under the authority to fill blanks, the holder of the instrument may insert the payee's name,11 but of course it must be done in accordance with authority. Where the maker of a note signed it in blank and delivered it to a third person with authority to fill in the blanks, and in so doing he filled in an amount in excess of that authorized by the maker, and the payee had knowledge of such fact, the maker is not liable on the note to the payee.42 But, where a note was signed in blank and delivered to another who filled in the blanks, making plaintiff in an action on the note the payee, the latter was not a holder in due course, and it was not enforceable against the signers, if it was not filled in in accordance with instructions of or agreement with the signers.43 And where a note executed in Mexico was left blank as to the place of payment, and the payee filled the blank, making the note payable in California, it was enforceable in such state, although it did not comply with the laws of Mexico in form and

38 Harris v. Berger, 15 N. Y. S. 389. 39 Luellen v. Hare, 32 Ind. 211. 40 Snyder v. Van Doren, 46 Wis. 602, 1 N. W. 285, 32 Am. Rep. 739; Hannen v. Peoples State Bank, 195 Ky. 58, 241 S. W. 355.

41 People v. Gorham, 9 Cal. App. 341, 99 Pac. 391; Finley v. Rose, 189 Ky. 359, 224 S. W. 1059; Simpson v. First Nat. Bank, 94 Ore. 147, 185 Pac. 913.

42 Hannen v. Peoples State Bank, 195 Ky. 58, 241 S. W. 355.

43 Vander Ploeg v. Van Zuuk, 135 Iowa 350, 112 N. W. 807, 13 L. R. A. (N. S.) 490, 124 Am. St. 275; Exchange Bank v. Robinson, 185 Mo. App. 582, 172 S. W. 628; Hartington Nat. Bank v. Breslin, 88 Nebr. 47, 128 N. W. 659, 31 L. R. A. (N. S.) 130, Ann. Cas. 1912B, 1008. See also Iowa Code Supp., 1913, § 3060a-14, Mo. Rev. Stat. 1919, § 801, Nebr. Rev. Stat. 1913, § 5332, as to filling in blanks in instruments signed in blank, and Iowa Code Supp. 1913, § 3060a-52, as to holder in due course.

substance as to the time of filling in blanks in signed commercial paper, it is a general rule that the blank or blanks must be filled in by the holder within a reasonable time;45 and what constitutes a reasonable time is a question of fact under the circumstances of each case. A note reading, A note reading, " after date I promise to pay," and bearing the date, is an incomplete instrument, and is not a note payable on demand, it being the intention that the time of payment is to be inserted, and the holder is prima facie authorized to fill the blank with a definite time in accordance with the understanding of the parties.46 But the holder of a note has no right to fill in a blank as to the time of payment, where it was delivered to one without express authority to fill in the blank, and the understanding was that it was a completed instrument.47 Where the amount of a signed note is left blank, a subsequent holder to whom the maker delivered the note must pursue his authority strictly in filling in the amount, and if a larger amount than authorized is written in, it is a defense against all except a bona fide holder for value and without notice.48 And where an employer gave his employee a signed check, blank as to amount, for the purchase of an article for the employer, and to fill in the cost price, the seller had no authority to fill in the amount of a debt due him, by the employer, if he knew the blank was left for the price of the article purchased.49 But the signer of a blank note to be used for a particular purpose can be held liable thereon by a holder in due course and for value, although the note has been diverted to a different purpose." 50 An accommodation indorser of a blank note can not avoid liability on suit of a bona fide holder for value, on the ground that the note was filled in after it had been indorsed.51 And where a note payable to a person named or his order, is indorsed in blank it has been decided that the

48 White-Wilson-Drew Co. v. Egelhoff, 96 Ark. 105, 131 S. W. 208; Simpson v. First Nat. Bank, 94 Ore. 147, 185 Pac. 913.

49 Rodgers v. Baker, 136 App. Div. 85, 122 N. Y. S. 91.

50 Rusmissell v. White Oak Stave Co., 80 W. Va. 400, 92 S. E. 672, L. R. A. 1917F, 453.

51 Proctor v. Blanchard, 75 N. H. 186, 72 Atl. 210.

54

holder may sue either in his own name or in the payee's to his use, but in the latter case the maker may set up any defense which he could avail himself of if the payee had retained the ownership of the note.52 If a bill or note is signed in blank, and in such form is stolen, and the blank or blanks filled in without authority, and then negotiated to a bona fide holder for value in due course and without notice, the signer can not be held liable thereon, in the absence of negligence on his part.53 But one may be estopped from disputing the title of an innocent holder of commercial paper signed in blank, by failure to exercise proper care in regard to such paper.5 The Negotiable Instruments Law has not changed the rule of the law merchant that if blanks are negligently left in a negotiable paper the person who, by so doing, invited fraud must sustain any loss resulting therefrom, rather than an innocent holder for value.55 It is the language of an official Georgia syllabus that if a note, negotiable in form, is signed in blank, with spaces left which might easily be filled in without exciting suspicion, and while in such incomplete form, and prior to actual delivery, it is feloniously taken from the possession of the signer and completed, it does not necessarily become a valid obligation, even in the hands of a bona fide holder for value. Prima facie, in such case, the maker is not liable, since the implied authority to complete the instrument by filling in the blanks arises in favor of the one receiving it by virtue of its delivery. But the question of liability in such a case should be determined by reference to whether or not, under the evidence, the negligence of the maker in permitting the instrument to get into circulation constituted the proximate cause of the fraud, such as would estop him from denying a valid delivery. 56 Under the plea of non est factum the defendant has the burden of proof to show that he was injured by the manner in which the blank was

9.

52 Temple v. Hays, Morris (Iowa)

53 Linick v. Nutting, 140 App. Div. 265, 125 N. Y. S. 93; Atlanta Nat. Bank v. Bateman, 21 Ga. App. 624, 94 S. E. 853.

54 Allen Grocery Co. v. Bank c Buchanan County, 192 Mo. App. 476, 182 S. W. 777.

55 National Exch. Bank v. Lester, 119 App. Div. 786, 104 N. Y. S. 418.

56 Atlanta Nat. Bank v. Bateman, 21 Ga. App. 624, 94 S. E. 853.

filled.57 But, where an unauthorized amount is filled in a blank in a note, it would be a complete defense to an action on the note, and the burden of proof that it was so filled out as to amount, and was for the purpose for which it was given, is upon the plaintiff.58

§ 94. Execution or indorsement in blank-Application of rule. The rules laid down in the foregoing section have been applied where blanks have been left for the amount,59 as in the case of one who gives blank notes to another to secure the latter on his indorsement of notes executed by the former with the understanding that if the latter notes are paid the blank notes are to be returned, but if not paid they are to be filled out for the amount the indorser becomes liable for and are to be valid obligations for such amount, and the blank notes are filled up and negotiated in violation of the agreement and come into the hands of an innocent holder.60 So where a bill of exchange is left blank as to the amount, and the person for whose benefit it is made fills it up for a larger amount than was agreed upon, an innocent holder for value and before maturity, who has discounted the bill for the amount called for upon its face may collect such amount.61 However, such an instrument is not enforceable in the hands of one who is not a holder in due course.62 So, where a note is signed with space for attorney's fee left blank, the payee has authority to fill in the blank for an amount not excessive.63 And where a person, as accommodation

57 Goree v. Uvalde Nat. Bank (Tex. Civ. App.), 218 S. W. 620. v. Massey, 267 Pa. 239,

58 Masscy 110 Atl. 341. 59 Griffith v. Collier, 4 Ky. L. 260; Van Duzer v. Howe, 21 N. Y. 531; Humphrey v. Finch, 97 N. Car. 303, 1 S. E. 870, 2 Am. St. 293; Grissom v. Fite, 38 Tenn. (1 Head) 332. "Having executed the note in blank as to the amint, with the intention that the blank should be filled before being negotiated by the person in whose possession 1e placed it after signature, third persons dealing with the person in possession have the right to presume that the authority to fill the blank was a general and not a

special authority, and they are not bound by any private instruction as to the amount which should be inserted in the note." Johnston Harvester Co. v. McLean, 57 Wis. 258, 15 N. W. 177, 46 Am. Rep. 39.

60 Harris v. Berger, 15 N. Y. St. 389.

61 Smith v. Lockridge, 8 Bush (Ky.) 423; First Nat. Bank v. Trognitz, 14 Cal. App. 176, 111 Pac. 402; Lin'ck v. Nutting & Co., 140 App. Div. 265, 125 N. Y. S. 93; Phillips v. Hensley, 175 N. Car. 23.

62 Stone v. Sargent, 220 Mass. 445, 107 N. E. 1014.

63 Schutzer v. Kramer, 189 Ill. App. 350; 268 I11. 603, 109 N. E. 695.

64

maker with another, signed a note with the understanding that the space for the amount, which was left blank, should be filled so as to make a note for forty-five dollars, and the figures forty-five preceded by the dollar sign were put in the corner of the note, but the person intrusted with the note placed a cipher after such figures and filled the blank with the words "four hundred and fifty dollars," without the knowledge of the payee and before delivery to him, it was held that the maker was liable. Again, where a person signed three accommodation notes and delivered them to another to be filled out with an amount to be ascertained and which was due on a prior accommodation note given between the same parties, and instead of making the notes for one-third each of the total amount due, the person to whom it had been intrusted filled one of them out for a considerably larger amount and indorsed it to the plaintiff bank before maturity in the usual course of business, the bank was allowed to recover thereon against the maker.65 But, where the note is complete in itself in every way, the amount being stated therein in the proper places, the fact that there is space left before the amount sufficient to enable the one to whom it is given to enlarge it by inserting words and figures before the proper amount, is held not to be such negligence as will enable a bona fide holder of a note which has been so changed to recover the enlarged amount.66 The general rule has also been applied in the case of blanks referring to rate of interest,67 date,68 name of payee,' 69

64 Johnston Harvester Co. v. McLean, 57 Wis. 258, 15 N. W. 177, 46 Am. Rep. 39.

65 Market & Fulton Nat. Bank v. Sargent, 85 Maine 349, 27 Atl. 192, 35 Am. St. 376.

66 Burrows v. Klunk, 70 Md. 451,
17 Atl. 378, 3 L. R. A. 576.

67 Fisher v. Dennis, 6 Cal. 577, 65
Am. Dec. 534; Rainbolt v. Eddy, 34
Iowa 440, 11 Am. Dec. 152; Iron
Mountain v. Murdock, 62 Mo. 70.

68 Averton v. Matthews, 35 Ark. 146,
37 Am. Rep. 9; Hubbard v. First State
Bank, 67 Ind. App. 47, 114 N. E. 642.
The implied authority to fill in the
date extends only to the true date.

Landon v. Foster Drug Co. (Tex. Civ. App.), 186 S. W. 434; Bank of Houston v. Day, 145 Mo. App. 410, 122 S. W. 756. If a third person takes a note executed in blank as to the amount, the transferee has the right to assume that the blanks have been properly filled. Business Mens League v. Sragow, 153 N. Y. S. 231.

69 Hubbard v. First State Bank, 67 Ind. App. 47, 114 N. E. 642; Business Mens League v. Sragow, 153 N. Y. S. 231; Close v. Fields, 2 Tex. 232; Jones v. Primm, 6 Tex. 170; Fretwell v. Carter, 78 S. Car. 531, 59 S. E. 639

(filling in name of indorser as payee); Roth v. Donnelly Grocery Co., 8 Ga.