How to Draw a Note 217 



A note payable to the order of another must 

 be endorsed by that other to render it transfer- 

 able. There are several forms of endorsement. 

 The payee, that is, the person to whom the note is 

 made payable, may simply write his name on the 

 back. In such a case he becomes liable for the 

 note, provided it is duly presented for payment 

 at the bank or place of payment named in the 

 note, or at the place of business or residence of 

 the maker, and, if it is not paid, it is duly pro- 

 tested by a notary public or other proper per- 

 son. Sometimes a note given by A to B may 

 be endorsed as follows: "Pay to the order of 

 0"; in which case C, to make it negotiable, 

 would have to endorse it. In this way a note 

 frequently has several endorsers. The rule of law 

 is that endorsers are severally and collectively 

 liable on a defaulted and protested note and 

 that each has recourse over and against the pre- 

 vious endorser and the maker. The first endorser 

 has, of course, recourse against the original maker. 

 If an endorser desires to protect himself against 

 loss and merely endorses to make the note nego- 

 tiable, he may escape such liability by so stat- 

 ing on the back of the note before his signature. 

 The words "without recourse" above the signa- 

 ture are commonly accepted in the business 

 world as a proper protection when an endorser 

 desires so to escape liability. 



