LEGAL PHASES OF COOPERATIVE ASSOCIATIONS. 3t 
courts are dixtdnd as to whether the maker of the note may plead 
intervening equities as a defense against the holder. 
The general rule, without special regard to accommodation notes, 
is that one who takes a note or other negotiable instrument after 
it is due takes it subject to all the equities or defenses that existed 
between the original parties. For instance, if a note is given 
without consideration, this could be shown by the maker when 
sued by one who took the note after it was due.° 
In the eyes of the law the fact that the note was not paid when 
it was due is notice to the party taking it from the former holder 
that there is some defect in the paper. However, with respect to 
accommodation paper, in view of the fact that it is always given 
without consideration, the courts in a majority of the States have 
refused to allow the maker to plead a want of consideration, al- 
though the note was taken after it was due.° But in some juris- 
dictions the maker of an accommodation note may successfully 
plead a want of consideration even as against one who received 
it in good faith and for a valuable consideration from the original 
payee.’ 
Where a note is payable on demand, the general rule as to ordi- 
nary negotiable commercial paper is that one who takes it an un- 
reasonable time after its execution takes it subject to all defenses 
that existed between the original parties.* Of course, if the maker 
would not have a defense to a suit on the note if brought by the 
original payee, he would not have a defense to a suit instituted by 
one who took the note from the origina] payee either before or 
after maturity. With respect to accommodation paper payable on 
demand, in those jurisdictions where a want of consideration may 
be shown by the maker as against one who took such paper after 
it was due, the maker may successfully plead this defense as against 
one who took the demand accommodation note an unreasonable 
time after its execution. In a North Dakota case® it was said: 
“It is well established that a note payable on demand is due within 
a reasonable time after its date, and there are practically no au- 
thorities which hold that such a reasonable time can be exténded 
beyond a year.” 
In a doubtful case it would be a question for the jury to deter- 
mine whether a note had been sold or delivered as collateral for a 
‘| loan an unreasonable length of time after its execution. In those 
States where the defense of a want of consideration can not be 
* Otis Elev. Co. v. Ford, 27 Del. 286, 88 Atl. 465. 
5 Hill v. Shield, 81 N. C. 250, 31 Am. R. 499. 
6 Naef v. Potter, 226 Ill. 628, 80, N. BE. 1084, 11 L. R. A. (N. S.) 10384. 
7 Chester v. Dorr, 41 N. Y. 279; Peale v. Addicks, 174 Pa. 549. 
® Otis Eley. Co. v. Ford, 27 Del. 286, 88 Atl. 465. 
* Adan v. Grand Forks Merc. Co., 24 N. D. 645, 140 N. W. 725, 47 L. R. A. (N. S.) 246. 
