5. A Negotiable Note Should Not Be Sealed

By the modern law a corporation which should attach its corporate seal to a promissory note, would not render the obligation non-negotiable. It might have this effect, but would not be decisive. The question would be, what was the corporation's intention? If it was intended to make a non-negotiable note, the seal would have this effect; if it did not intend this, the seal would not destroy its negotiability.

This is the present rule.

6. How An Agent Should Sign

A note signed by a1 agent without the addition of any principal was once regarded as the signer's obligation. The addition to his name of the word, Agent, President, Treasurer, was legally considered as a mere description of himself, but the tendency of the modern decisions is to regard a note thus signed, not an individual obligation, but that of an association or company, and to permit oral proof to explain the signer's intention. "There is a growing inclination to consider an instrument as it would manifestly be understood by the average business man, or, in other words, as it was most probably understood by the party receiving and the party signing it, and to exonerate the latter from liability where, according to such construction, it appears to the court that he did not intend, and was not understood to bind himself, but to act for the corporation of which he was the authorized agent."1

7. To Be Valid A Promissory Note Must Be Delivered

The maker would have a good defense to a note that was completed in form and locked up in a desk, and afterwards found and sold by a thief. This is one of the risks run by the purchasers of negotiable paper.2 But a note once properly put into circulation and afterward stolen, the maker must pay, for its birth is legitimate. In the other case it is not a note at all. In like manner, a note made and delivered on Sunday is not valid; but though written and dated on Sunday, if it were not delivered until the next day, the maker would be bound. It becomes effective on the day of its delivery, and not on the day of its date.

8. Effect Of Alterations

A promissory note should not be altered after it is signed and delivered, however innocent may be the holder's act. Suppose the holder, on looking at the note, discovers the omission of the interest clause, and knowing that it was the intention of both parties that interest should be paid, expresses this intention in the note. The addition would be fatal. In one of the recent cases the court said, "The motive of a creditor in making an alteration may not be fraudulent, yet as the alteration changes the legal identity and effect of the instrument, the debtor may well say it is not the contract into which he entered, and he is not, therefore, bound by it." l This rule prevails everywhere, and yet there is a slight qualification. If the alteration is not material, it does not vitiate the note. The question, therefore, when an alteration has been made, relates to its materiality. This is a question of mixed law and fact. The principal alterations which have been deemed material are, the date, amount, place of payment, name, adding names as witnesses, addition of an interest clause, and the erasure of an original alteration. In such cases, does the holder tail to recover anything? Once it was held that when the alteration was clearly proved there could be no recovery. This rule has been somewhat qualified and may be thus stated: if the alteration is immaterial, the right to recover is not impaired. If the alteration is material and fraudulent, there can be no recovery on the note; if the alteration is material, hut was made by the holder and innocently, although there can be no recovery on the note, yet the amount originally loaned can be recovered independently of the note. In other words, the law can not enforce the written contract; but as the borrower ought in justice to repay the money loaned to him, the law will compel him to do so if he refuses, just as though he had not given a note.

1 Second National Hank v. Midland Steel Co., 155 Ind. 588. 2 T he law is otherwise in the states that have adopted the new Negotiable Instruments law.