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361. A PROMISSORY Note, or note of hand, is an engagement, in writing, to pay a specified sum, either to a person named in the note, or to his order, or to the bearer.
A joint note is one signed by two or more persons, who to. gether are holden for its payment.
A joint and several note is one signed by two or more per. sons, who separately and together are holden for its payment.
A negotiable note is one so made that it can be sold or transferred from one person to another.
362. The maker or drawer of a note is the person who signs it.
The payee, promisee, or holder of a note is the person to whom it is to be paid.
The indorser of a note is the person who writes his name upon
its back to transfer it, or as a guaranty of its payment. If the indorser, however, wishes only to transfer the note, he
may write before his name the words “ without recourse," and then, though by his name he guarantees the genuineness of the note, he is not liable for its payment, should the maker not pay it when due.
363. The face of a note is the sum for which it is given.
364. A note should contain the words “value received,” and the sum for which it is given should be expressed in written words, or, as is the general custom, the dollars may be written in words and the cents, if any, be expressed as hundredths of a dollar in the form of a common fraction.
NOTE. The laws of Pennsylvania require that the words “ without defalcation” should be inserted in a promissory note; and in Indiana, notes generally contain the words “ without any relief whatever from valuation or appraisement laws."
365. A note is said to be one on time, when it is made payable on or after a certain date, and the day on which it becomes legally due is called the day of maturity.
366. According to the laws of many of the States, when a particular day is specified in the note for its payment, three
days additional are allowed, called days of grace, within which the maker may pay the note, unless it states “ without grace.” Should the third day of grace, however, fall on Sunday, or some public day, the day of maturity will be a day earlier.
367. When a note is written for months, calendar months are understood. Thus, if a note be dated April 21, for one month, it will be nominally due May 21; and if dated January 29, 30, or 31, it being for one month, it will be nominally due February 28, should it be a common year, or February 29, should it be a leap year.
368. When a note is written without interest, it can only draw interest, if on time, after the time specified for its payment, and not then lawfully, in some States, till after a demand has been made; or if not on time, after payment has been demanded.
NOTE. A note attested or witnessed, in Massachusetts and some other States, is taken out of the statute of limitation.
PARTIAL PAYMENTS ON NOTES AND BONDS.
369. PARTIAL or part payments on notes, bonds, or other obligations, being receipted for by entry on the back of the obligation, are termed indorsements.
UNITED STATES RULE.
370. In the United States courts, and the courts of Massachusetts, New York, and several other States, interest on notes and bonds, when partial payments have been made, is reckoned according to the following
RULE. — Compute the interest on the principal to the time when the first payment was made, which equals or exceeds, either alone or with preceding payments, the interest then due.
Add that interest to the principal, and from the amount subtract the payment or payments thus far made.
The remainder will form a new principal; on which compute the interest, proceeding as before.
NOTE. — This rule is on the principle that neither interest nor payment should draw interest.
Boston, June 17, 1847. For value received, I promise to pay Nathaniel Ford, or order, on demand, one hundred and sixty-five dollars and eighteen cents, with interest. Attest, Joseph FIELD.
On this note are the following indorsements. December 7, 1847, received eighteen dollars and thirteen cents of the within note. October 19, 1848, re ceived twenty-eight dollars and sixteen cents. September 25, 1849, received thirty-six dollars and twelve cents. July 10, 1850, received three dollars and eighteen cents. June 6, 1851, received thirty-six dollars and twenty-eight cents. December 28, 1852, received thirty-one dollars and seventeen cents. May 5, 1853, received three dollars and eighteen cents. September 1, 1853, received twenty five dollars and eighteen cents. October 18, 1854, received ten dollars. How much remains due September 27,
Ans. $ 15.417.
Principal, carrying interest from June 17, 1847,
$ 165.180 Interest from June 17, 1847, to Dec. 7, 1847, 5mo. 20d., 4.680
Amount, 169.860 First payment, December 7, 1847,
18.130 Balance for new principal,
151.730 Interest from Dec. 7, 1847, tc Oct. 19, 1848, 10mo. 12d., 7.889'
Amount, 159.619 Second payment, October 19, 1848,
28.160 Balance for new principal,
131.459 Interest from Oct. 19, 1848, to Sept. 25, 1849, 11mo. 6d., 7.361
Amount, 138.820 Third payment, September 25, 1849,
36.120 Balance for new principal,
102.700 Interest from Sept. 25, 1849, to June 6, 1851, 20mo. 11d., 10.458
Amount, 113.158 Fourth pay't, July 10, 1850, a sum less than interest, 3.18 Fifth pay't, June 6, 1851, a sum greater than interest, 36.28
39.460 Balance for new principal,
73.698 Interest from June 6, 1851, to Dec. 28, 1852, 18mo. 22d., 6.903
Amount brought forward, $ 80.601 Sixth payment, December 28, 1852,
31.170 Balance for new principal,
49.431 Interest from Dec. 28, 1852, to May 5, 1853, 4mo. 7d., 1.046
Amount, 50.477 Seventh payment, May 5, 1853,
3.180 Balance for new principal,
47.297 Interest from May 5, 1853, to Sept. 1, 1853, 3mo. 26d., .914
Amount, 48.211 Eighth payment, September 1, 1853,
25.180 Balance for new principal,
23.031 Interest from Sept. 1, 1853, to Oct. 18, 1854, 13mo. 17d., 1.562
Amount, 24.593 Ninth payment,
10.000 Balance for new principal,
14.593 Interest from Oct. 18, 1854, to Sept. 27, 1855, 11mo. 9d., .824 Balance due at the time of payment,
$ 15.417 (2.) $769.87.
St. Louis, June 17, 1849. For value received, I promise to pay L. Swan, or order, on demand, seven hundred and sixty-nine dollars and eighty-seven cents, with interest.
SAMUEL Q. PETERS. Attest, Moses HAYNES. Payments: March 1, 1850, seventy-five dollars and fifty cents; June 11, 1851, one hundred and sixty-five dollars; September 15, 1851, one hundred and sixty-one dollars; Jan. 21, 1852, forty-seven dollars and twenty-five cents; March 5, 1853, twelve dollars and seventeen cents; December 6, 1853, ninetyeight dollars; July 7, 1854, one hundred and sixty-nine dollars.
What remains due September 25, 1855 ? Ans. $ 226.297. (3.) $ 300.
Chicago, April 30, 1851. For value received, I promise Kimball & Hammond to pay them, or order, on demand, three hundred dollars, with interest.
SIMPSON W. LEAVET. Payments: June 27, 1852, one hundred and fifty dollars; December 9, 1852, one hundred and fifty dollars. What was due October 9, 1853 ?
Ans. $ 26.735. (4.) $ 54.18.
San Francisco, Feb. 11, 1852. For value received, I promise to pay John Trow, or order, on demand, fifty-four dollars and eighteen cents, with interest.
LUKE M. SAMPSON.
Payments: July 11, 1853, twelve dollars and twenty-five cents; August 15, 1854, two dollars and ten cents; July 9, 1855, three dollars and twelve cents; August 21, 1855, thirty-seven dollars and eighteen cents.
What was due December 17, 1855? Ans. $ 10.222.
New York, January 1, 1850. For value received, I promise to pay James Johnson, or order, on demand, one thousand dollars, with interest at seven per cent.
SAMUEL T. FORTUNE. Indorsements: September 28, 1850, one hundred and forty-four dollars; March 1, 1851, twenty dollars; July 17, 1851, three hundred and sixty dollars; August 9, 1851, one hundred and ninety dollars; September 25, 1852, one hundred and seventy dollars; December 11, 1853, two hundred dollars; July 4, 1855, seventy-five dollars. What was due June 1, 1857 ?
Ans. $ 7.61.
371. The Supreme Court of the State of Connecticut has adopted the following
RULE. Compute the interest to the time of the first payment, if that be one year or more from the time the interest commenced, add it to the principal, and deduct the payment from the sum total. If there be after payments made, compute the interest on the balance due to the next payment, and then deduct the payment as above; and in like manner from one payment to another, till all the payments are absorbed; provided the time between one payment and another be one year or more.
If any payments be made before one year's interest has accrued, then compute the interest on the principal sum due on the obligation for ONE YEAR, add it to the principal, and compute the interest on the sum vaid from the time it was paid up to the end of the year; add it to the sum paid, and deduct that sum from the principal and interest added
If any payments be made of a less sum than the interest arisen at the time of such payment, no interest is to be computed, but only on the principal sum for any period.
NOTE. — If a year extends beyond the time of settlement, find the amount of the remaining principal to the time of settlement; find also the amount of the indorsement or indorsements, if any, from the time they were paid to the time of settlement, and subtract their sum from the amount of the principal.
(1.) $ 900.
New Haven, June 1, 1858. For value received, I promise to pay J. Downs, or order, nine hundred dollars, on demand, with interest.
JAMES L. EMERSON.