NOTE. -Any valid extension of time to the acceptor discharges the drawer.

One who has signed a note as surety, will not be discharged by an invalid agreement to extend the time of payment to his principal; nor by a valid agreement made by a holder without notice that he is a surety.

Where one issue was whether the time of payment had been extended on the note in suit, the jury was instructed that an agreement to pay a bonus or interest in excess of ten per cent, being illegal, would not constitute a sufficient consideration. Held, that this must be understood of a mere executory agreement, and was correct.

The words "This note to be extended if desired by makers” indorsed upon a note, are too indefinite to have any significance, and the unauthorized addition thereto, by the holders of the words, "on payment of the interest, as expressed, until January 1, 1879" would not affect the note.

An agreement upon sufficient consideration, to extend the time of payment of a note "until after threshing" held to be for a time sufficiently definite to give it validity, and work a discharge of the nonassenting surety.

When paid by secondary party.--When the instrument is paid by a party secondarily liable thereon, it is not discharged; but the party so paying it is remitted to his former rights as regards all prior parties, and he may strike out his own and all subsequent indorsements and again negotiate the instrument, except:

1. Where it is payable to the order of a third person, and has been paid by the drawer; and

2. Where it was made or accepted for accommodation, and has been paid by the party accommodated.

Renunciation of rights.---The holder may expressly renounce his rights against any party to the instrument, before, at or after its maturity. An absolute and unconditional renunciation of his rights against the principal debtor made at or after the maturity of the instrument discharges the instrument. But a renunciation does not affect the rights of a holder in due course without notice. A renunciation must be in writing, unless the instrument is delivered up to the person primarily liable thereon.

Cancellation by mistake.--A cancellation made unintentionally, or under a mistake, or without the authority of the holder, is inoperative; but where an instrument or a signature thereon appears to have been cancelled the burden of proof lies on the party who alleges that the cancellation was made unintentionally, or under a mistake or without authority.

Altering of instrument.--Where a negotiable instrument is materially altered without the assent of all parties liable thereon, it is avoided, except as against a party who has himself made, authorized or assented, orally or in writing, to the alteration and subsequent indorsers. But when an instrument has been materially altered and is in the hands of a holder in due course, not a party to the alteration, he may enforce payment thereof according to its original tenor.

Changing a word "order" to "bearer", if it appears to have been done at the time of execution, will not affect the paper. Otherwise, if made after delivery. Such an alteration is a material one.

If such words were written after the note was signed by the makers, with the knowledge and consent of the holder, but without the knowledge or consent of the party sought to be charged, the liability of the latter was thereby extinguished.

An alteration by a trespasser, against the holder's will, does not affect the paper.

An alteration of a written contract, which in no way changes the legal effect thereof as between the parties thereto, is immaterial and does not avoid the contract.

Merely affixing the name of an attesting witness to a promissory note is not a material alteration thereof.

If an alteration is immaterial, the intent with which it was made is immaterial.

Material alteration.---Any alteration which changes: 1. The date;

2. The sum payable, either for principal or interest;

3. The time or place of payment;

4. The number or the relation of the parties;

5. The medium or currency in which payment is to be made;

Or which adds a place of payment where no place of payment is specified, or any other change or addition which alters the effect of the instrument in any respect, is a material alteration.

ALTERATION OF MEMORANDUM.-The material change in a memorandum which is a part of an instrument avoids it.

SECTION XII.

BILLS OF EXCHANGE.

FORM AND INTERPRETATION.

What is bill of exchange.---A bill of exchange is an unconditional order in writing addressed by one person to another, signed by the person giving it, requiring the person

to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money to order or bearer.

Not an assignment of funds.---A bill of itself does not operate as an assignment of the funds in the hands of the drawee available for the payment thereof and the drawee is not liable on the bill unless and until he accepts the same.

Address of bill.---A bill may be addressed to two or more drawees jointly, whether they are partners or not; but not to two or more drawees in the alternative.

Inland and foreign bill.---An inland bill of exchange is a bill which is, or on its face purports to be, both drawn and payable within this state. Any other bill is a foreign bill. Unless the contrary appears on the face of the bill, the holder may treat it as an inland bill.

Where drawer and drawee are same person. ---Where in a bill drawer and drawee are the same person, or where the drawee is a fictitious person, not having capacity to contract, the holder may treat the instrument, at his option, either as a bill of exchange or a promissory note.

Referree in case of need.---The drawer of a bill and any indorser may insert thereon the name of a person to whom the holder may resort in case of need, that is to say, in case the bill is dishonored by non-acceptance or non-payment. Such person is called the referee in case of need. It is in the option of the holder to resort to the referee in case of need or not as he may see fit.

SECTION XII.

ACCEPTANCE.

Acceptance of bill.---The acceptance of a bill is the signification by the drawee of his assent to the order of the drawer. The acceptance must be in writing and signed by the drawee. It must not express that the drawee will perform his promise by any other means than the payment of money. NOTE. -Acceptance is not revocable after negotiation. It need not be in any particular form. The words: honored, seen, presented, acted, are sufficient, but merely taking notice of the bill are not.

IN WRITING.-A Vermont statute required acceptance to be written but where the drawer discounted the bill without accepting it, his acceptance was implied. So held also where the drawee wrote on the bill an order upon a third person topay it.

Acceptance in writing.---The holder of a bill presenting the same for acceptance may require that the acceptance be written on the bill and if such request is refused, may treat the bill as dishonored.

Written acceptance on paper other than bill.--Where an acceptance is written on a paper other than the bill itself, it does not bind the acceptor except in favor of a person to whom it is shown and who, on the faith thereof, receives the bill for value.

Promise in writing.---An unconditional promise in writing to accept a bill before it is drawn is deemed an actual acceptance in favor of every person who, upon the faith thereof, receives the bill for value.

NOTE. This is the settled rule in this country. The bill must be drawn within a reasonable time after such promise. It is sufficient that the bill to be drawn be so designated that there can be no doubt that the particular one drawn was intended. The bill must not vary from the authority in any material particular.

Time allowed for acceptance.-The drawee is allowed twenty-four hours after presentment in which to decide whether or not he will accept the bill; but the acceptance, if given, dates as of the day of presentation.

Refusal or failure to return. ---Where a drawee to whom a bill is delivered for acceptance destroys the same, or refuses within twenty-four hours after such delivery, or within such other period as the holder may allow, to return the bill accepted or non-accepted to the holder, he will be deemed to have accepted the same. Mere retention of the bill is not acceptance.

DESTRUCTION: REFUSAL TO RETURN.---Similar statutes have been construed to refer only to acts of a tortious nature, implying conversion, and not where the bill is left with the drawee by the holder, and no demand made for its return.

Acceptance before signing.---A bill may be accepted before it has been signed by the drawer, or while otherwise incomplete, or when it is overdue, or after it has been dishonored by previous refusal to accept or by non-payment. But when a bill payable after sight is dishonored by non-acceptance and the drawee subsequently accepts it, the holder, in the absence of any different agreement, is entitled to have the bill accepted as of the date of the first presentment.

General or qualified acceptance.--An acceptance is either general or qualified. A general acceptance assents with

out qualification to the order of the drawer. A qualified acceptance in express terms varies the effect of the bill as drawn.

NOTE. -An acceptance to pay when due is general. So of an acceptance to pay if another person would not. A conditional acceptance must be distinct and clear, or it will be construed to be general.

General acceptance.-An acceptance to pay at a particular place is a general acceptance unless it expressly states that the bill is to be paid there only and not elsewhere.

is:

Qualified acceptance.--An acceptance is qualified, which

1. Conditional, that is to say, which makes payment by the acceptor dependent on the fulfillment of a condition therein stated;

2. Partial, that is to say, an acceptance to pay part only of the amount for which the bill is drawn;

3. Local, that is to say, acceptance to pay only at a particular place;

4. Qualified as to time;

5. The acceptance of some one or more of the drawees, but not of all.

An acceptance to pay when in funds is qualified. So of acceptance to pay when lumber is run to market.

Refusal of qualified acceptance.--The holder may refuse to take a qualified acceptance, and if he does not obtain an unqualified acceptance, he may treat the bill as dishonored by non-acceptance. Where a qualified acceptance is taken the drawer and indorsers are discharged from liability on the bill, unless they have expressly or impliedly authorized the holder to take a qualified acceptance or subsequently assent thereto. When the drawer or indorsers receive notice of a qualified acceptance, he must within a reasonable time express his dissent to the holder, or he will be deemed to have assented thereto.

SECTION XIV.

PRESENTMENT FOR ACCEPTANCE.

Where made.-Presentment for acceptance must be made: 1. Where the bill is payable after sight, or in any other case where presentment for acceptance is necessary in order to fix the maturity of the instrument; or

2. Where the bill expressly stipulates that it shall be presented for acceptance; or