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CHAPTER THE THIRTIETH.
OF TITLE BY GIFT, GRANT, AND CONTRACT.

WE are now to proceed, according to the order marked out, to the difcuffion of two of the remaining methods of acquiring a title to property in thins perfonal, which are much connected together, and anfwer in fome meafure to the conveyances of real eftates; being thofe by gift of grant, and by contract: whereof the former vefts a property in poffeffion, the latter a property in action.


VIII. GIFTS then, or grants, which are the eighth method of transferring perfonal property, are thus to be diftinguifhed from each other, that gifts are always gratuitous, grants are upon fome confideration or equivalent: and they may be divided, with regard to their fubject-matter, into gifts or grants of chattels real, and gifts or grants of chattels perfonal. Under the head of gifts or grants of chattels real may be included all leafes for years of land, affignments, and furrenders of thofe leafes; and all the other methods of conveying an eftate lefs than freehold, which were confidered in the twentieth chapter of the prefent book, and therefore need not be here again repeated: though thefe very feldom carry the outward appearance of a gift, however freely beftowed; being ufually expreffed to be made in confideration of blood, or natural affection, or of five or ten fhillings nominally paid to the grantor; and, in cafe of leafes, always referving a rent, though it be but a peppercorn: any of which confiderations will, in the eye of the law, convert the gift, if executed, into a grant; if not executed, into a contract.
GRANTS
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GRANTS or gifts, of chattels perfonal, are the act of tranfferring the right and the poffeffion of them; whereby one man renounces, and another man immediately acquires, all title and intereft therein: which may be done either in writing, or by word of mouth ^a attefted by fufficient evidence, of which the delivery of poffeffion is the ftrongeft and moft effential. But this conveyance, when merely voluntary, is fomewhat fufpicious: and is ufually conftrued to be fraudulent, if creditors or others become fufferers thereby. And, particularly, by ftatute 3 Hen. VII. c. 4. all deeds of gift of goods, made in truft to the ufe of the donor, fhall be void; becaufe otherwife perfons might be tempted to commit treafon or felony, without danger of forfeiture; and the creditors of the donor might alfo be defrauded of their rights. And by ftatute 13 Eliz. c. 5. every grant or gift of chattels, as well as lands, with intent to defraud creditors or others ^b, fhall be void as againft fuch perfons to whom fuch fraud would be prejudicial; but, as againft the grantor himfelf, fhall ftand good and judicial; but, as againft the grantor himfelf, fhall ftand good and effectual: and all perfons partakers in, or privy to, fuch fraudulent grants, fhall forfeit the whole value of the goods, one moiety to the king, and another moiety to the party grieved; and alfo on conviction fhall fuffer imprifonment for half a year.

A TRUE and proper gift or grant is always accompanied with delivery of poffeffion, and takes effect immediately; as if A gives to B 100 l, or a flock of fheep, and puts him in poffeffion of them directly, it is then a gift executed in the donee; and it is not in the donor's power to retract it; though he did it without any confideration or recompenfe^c: unlefs it be prejudicial to creditors; or the donor were under any legal incapacity, as infancy, converture, durefs, or the like; or if he were drawn in, circumvented, or impofed upon, by falfe pretences, ebriety, or furprize. But if the gift does not take effect, by delivery of immediate poffeffion, it is then not properly a gift, but a contract: and this

.{FS}
^a Perk. §. 57.
^b See 3 Rep. 82.
^c Jenk. 109.
.{FE}
a man
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a man cannot be compelled to perform, but upon good and fufficient confideration; as we fhall fee under our next divifion.

IX. A CONTRACT, which ufually conveys an intereft merely in action, is thus defined: “an agreement, upon fufficient confideration, to do or not to do a particular thing.” From which definition there arife three points to be contemplated in all contract; 1. The agreement: 2. The confideration: and 3. The thing to be done or omitted, or the different fpecies of contracts.

FIRST then it is an agreement, a mutual bargain or convention; and therefore there muft at leaft be two contracting parties, of fufficient ability to make a contract: as where A contracts with B to pay him 100 l. and thereby transfers a property in fuch fum to B. Which property in however not in poffeffion, it could not be transferred to another perfon by the ftrict rules of the antient common law: for no chofe in action could be affigned or granted over ^d, becaufe it was though to be a great encouragement to litigioufnefs, if a man were allowed to make over to a ftranger his right of going to law. But this nicety is now difregarded: though, in compliance with the antient principle, the form of affigning a chofe in action is in the nature of a declaration of truft, and an agreement to permit the affignee to make ufe of the name of the affignor, in order to recover the poffeffion. And therefore, when in common acceptation a debt or bond is faid to be affigned over, it muft ftill be fued in the original creditor's name; the perfon, to whom it is transferred, being rather an attorney than an affignee. But the king is an exception to this general rule; for he might always either grant or receive a chofe in action by affignment^e: and our courts of equity, confidering that in a commercial country almoft all perfonal property muft neceffarily lie in contract, will protect the affignment of a chofe in action, as much as the law will that of a chofe in poffeffion ^f.

.{FS}
^d Co. Litt. 214.
^e Dyer. 30. Bro. Abr. tit. chofe in action. 1 & 4.
^f 3 P. W^ms. 199.
.{FE}
THIS
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THIS contract or agreement may be either exprefs or implied. Exprefs contracts are where the terms of the agreement are openly uttered and avowed at the time of the making, as to deliver an ox, or ten load of timber, or to pay a ftated price for certain goods. Implied are fuch as reafon and juftice dictate, and which therefore the law perfumes that every man undertakes to perform. As, if I employ a perfon to do any bufinefs for me, or perform any work; the law implies that I undertook or contracted, to pay him as much as his labour deferves. If I take up wares from a tradefman, without any agreement of price, the law concludes that I contracted to pay their real value. And there is alfo one fpecies of implied contracts, which runs through and is annexed to all other contracts, conditions, and covenants; viz. that if I fail in my part of the agreement, I fhall pay the other party fuch damages as he has fuftained by fuch my neglect or refufal. In fhort, almoft all the rights of perfonal property (when not in actual poffeffion) do in great meafure depend upon contracts of one king or other, or at leaft might be reduced under fome of them: which indeed is the method taken by the civil law; it having referred the greateft part of the duties and rights, which it treats of, to the head of obligations ex contractu and quafi ex contractu^g.

A CONTRACT may alfo be either executed, as if A agrees to change horfes with B, and they do it immediately; in which cafe the poffeffion and the right are transferred together: or in may be executory, as if they agree to change next week; here the right only vefts, and their reciprocal property in each other's horfe is not in poffeffion but in action: for a contract executed (which differs nothing from a grant) conveys a chofe in poffeffion; a contract executory conveys only a chofe in action.

HAVING thus fhewn the general nature of a contract, we are, fecondly to proceed to the confideration upon which it is founded; or the reafon which moves the party contracting to enter into

.{FS}
^g Inft. 3. 14. 2.
.{FE}

H h h 2

the

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the contract. “It is an agreement, upon fufficient confideration.” The civilians hold, that in all contracts, either exprefs or implied, there muft be fomething given in exchange, fomething that is mutual or reciprocal ^h. This thing, which is the price or motive of the contract, we call the confideration: and it muft be a thing lawful in itfelf, or elfe the contract is void. A good confideration, we have before feenⁱ, is that of blood or natural affection between near relations; the fatisfaction accruing from which the law efteems an equivalent for whatever benefit may move from one relation to another ^j. This confideration may fometimes however be fet afide, and the contract become void, when it tends in it's confequences to defraud creditors or other third perfons of their juft rights. But a contract for any valuable confideration, as for marriage, for money, for work done, or for other reciprocal contracts, can never be impeached at law; and, if it be of a fufficient adequate value, is never fet afide in equity: for the perfon contracted with has then given an equivalent in recompenfe, and is therefore as much an owner, or a creditor, as any other perfon.

THESE valuable confiderations are divided by the civilians ^k into four fpecies. 1. Do, ut des: as when I give money or goods, on a contract that I fhall be repaid money or goods for them again. Of this kind are all loans of money upon bond, or promife of repayment; and all fales of goods, in which there is either an exprefs contract to pay fo much for them or elfe the law implies a contract to pay fo much as they are worth. 2. The fecond fpecies is, facio, ut facias: as when I agree with a man to do his work for him, if he will do mine for me; or if two perfons agree to marry together; or to do any other pofitive acts on both fides. Or, it may be to forbear on one fide in confideration of fomething done on the other; as, that in confideration A, the tenant, will repaid his houfe, B, the landlord, will bot fue him for wafte. Or, it may be for mutual forbearance on both

.{FS}
^h In omnibus contractibus, five nominates five innominatis, permutatio continetur. Gravin. l. 2. §. 12.
ⁱ pag. 297.
^j 3 Rep. 83.
^k Ff. 19. 5. 5.
.{FE}
fides;

^{h hhhh} hh
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fides; as, that in confideration that A will not trade Lifbon, B will not trade to Marfeilles; fo as to avoid interfering with each other. 3. The third fpecies of confiderations is, facio, ut des: when a man agrees to perform any thing for a price, either fpecifically mentioned, or left to the determination of the law to fet a value on it. As when a fervent hires himfelf to his mafter, for certain wages or an agreed fum of money: here the fervant contracts to do his mafter's fervice, in order to earn that fpecific fum. Otherwife, if he be hired generally; for then he is under an implied contract to perform this fervice for what it fhall be reafonably worth. 4. The fourth fpecies is, do, ut facias: which is the direct counterpart of the other. As when I agree with a fervant to give him fuch wages upon his performing fuch work: which, we fee, is nothing elfe but the laft fpecies inverted; for fervus facit, ut herus det, and herus dat, ut fervus faciat.

A CONSIDERATION of fome fort or other is fo abfolutely neceffary to the forming of a contract, that a nudum pactum or agreement to do or pay any thing on one fide, without any compenfation on the other, is totally void in law; and a man cannot be compelled to perform it ^l. As if one man promifes to give another 100 l. here there is nothing contracted for or given on the one fide, and therefore there is nothing binding on the other. And, however a man may or may not be bound to perform it, in honor or confcience, which the municipal laws do not take upon them to decide; certainly thofe municipal laws will not compel the executionof what he had no vifible inducement to engage for: and therefore our law has adopted ^m the maxim of civil law ⁿ, that ex nudo pacto non oritur action. But any degree of reciprocity will prevent the pact from being nude: nay, even if the thing be founded on a prior moral obligation, (as a promife to pay a juft debt, though barred by the ftatute of limitations) it is no longer nudum pactum. And as this rule was principally eftablifhed, to avoid the inconvenience that would arife from fetting up mere verbal promifes, for which no good reafon could

.{FS}
^l D. & t. d. 2. c. 24.
^m Bro. Abr. tit. uette. 79. Salk. 129.
ⁿ Cod. 2. 3. 10 & 5. 14. 1.
.{FE}
be
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be affigned ^o, it therefore does not hold in fome cafes, where fuch promife is authentically proved by written documents. For if a man enters into a voluntary bond, or gives a promiffory note, he fhall not be allowed to aver the want of a confideration inorder to evade the payment: for every bond from the folemnity of the inftrument ^p, and every note from the fubfcription of the drawer ^q, carries with it an internal evidence of a good confideration. Courts of juftice will therefore fupport them both, as againft the contractor himfelf; but not to the prejudice of creditors, or ftrangers to the contract.

WE are next to confider, thirdly, the thing agreed to be done or omitted. “A contract is an agreement, upon fufficient confideration, to do or not to do a particular thing.” The moft ufual contracts, whereby the right of chattels perfonal may be acquired in the laws of England, are, 1. That of fale or exchange. 2. That of bailment. 3. That of hiring and borrowing. 4. That of debt.

1. SALE or exchange is a tranfmutation of property from one man to another, in confideration of fome recompenfe in value: for there is no fale without a recompenfe; there muft be quid pro quo ^r. If it be a commutation of goods for goods, it is more properly an exchange; but, if it be a transferring of goods for money, it is called a fale: which is a method of exchange introduced for the convenience of manking, by eftablifhing an univerfal medium, which may be exchanged for all forts of other property; whereas if goods were only to be exchanged for goods, by way of barter, it would be difficult to adjuft the refpective values, and the carriage would be intolerably cumberfome. All civilized nations adopted therefore very early the ufe of money; for we find Abraham giving “four hundred fhekels of filver, current money with the merchant,” for the field of Machpelah ^s; though the practice of exchanges ftill fubfifts among feveral of the favage nations. But with regard to the law of fales and exchanges,

.{FS}
^o Plowd. 308, 309.
^p Hardr 200. 1 Ch. Rep. 157.
^r Noy's Max. c. 42.
^s Gen. c. 23. v. 16.
.{FE}
there
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there is no difference. I fhall therefore treat of them both under the denomination of fales only; and fhall confider their force and effect, in the firft place where the vendor hath in himfelf, and fecondly where he hath not, the property of the thing fold.

WHERE the vendor hath in himfelf the property of the goods fold, he hath the liberty of difpofing of them to whomever he pleafes, at any time, and in any manner: unlefs judgment has been obtained againft him for a debt or damages, and the writ of execution is actually delivered to the fheriff. For then, by the ftatute of frauds ^f, the fale fhall be looked upon as fraudulent, and the property of the goods fhall be bound to anfwer the debt, from the time of delivering the writ. Formerly it was bound from the tefte, or iffuing, of the writ ^t, and any fubfequent fale was fraudulent; but the law was thus altered in favour of purchafors, though it ftill remains the fame between the parties: and therefore, if a defendant dies after the awarding and before the delivery of the writ, his goods are bound by it in the hands of his executors ^v.

IF a man agrees with another for goods at a certain price, he may not carry them away before he hath paid for them; for it is no fale without payment, unlefs the contrary be expreffly agreed. And therefore, if the vendor fays, the price of a beaft is four pounds, and the vendee fays he will give four pounds, the bargain is ftruck; and they neither of them are at liberty to be off, provided immediate poffeffion be tendered by the other fide. But if neither the money be paid, nor the goods delivered, nor tender made, nor any fubfequent agreement be entered into, it is no contract, and the owner may difpofed of the goods as he pleafes ^u. But if any part of the price is paid down, if it be but a penny, or any portion of the goods delivered by way of earneft (which the civil law calls arrha, and interprets to be “emptionis-vendi-

.{FS}
29 Car. II. c. 3.
^t 8 Rep. 171. 1 Mod. 188.
^vComb. 33. 12 Mod. 5. 7 Mod. 95.
^u Hob 41. Ney's Max. c. 42.
.{FE}
“tionis
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“tionis contractae argumentum ^w,” the property of the goods is abfolutely bound by it: and the vendee may recover the goods by action, as well as the vendor may the price of them ^x. And fuch regard does the law pay to earneft as an evidence of a contract, that, by the fame ftatute 29 Car. II. c. 3. no contract for the fale of goods, to the value of 10 l. or more, fhall be valid, unlefs the buyer actually receives part of the goods fold, by way of earneft on his part; or unlefs he gives part of the price of the vendor by way of earneft to bind the bargain, or in part of payment; or unlefs fome note in writting be made and figned by the party, or his agent, who is to be charged with the contract. And, with regard to goods under the value of 10 l, no contract of agreement for the fale of them fhall be valid, unlefs the goods are to be delivered within one year, or unlefs the contract be made in writing, and figned by the party who is to be charged therewith. Antiently, among all the northern nations, fhaking of hands was held neceffary to bind the bargain; a cuftom which we ftill retain in many verbal contracts. A fale thus made was called handfale, “venditio per mutuam manuum complexionem ^y;” till in procefs of time the fame word was ufed to fignify the price or earneft, which was given immediately after the fhaking of hands, or inftead thereof.

AS foon as the bargain is ftruck, the property of the goods is transferred to the vendee, and that of the price to the vendor; but the vendee cannot take the goods, until he renders the price agreed on ^z. But if he tenders the money to the vendor, and he refufes it, the vendee may feife the goods, or have an action againft the vendor for detaining them. And by a regular fale, without delivery, the property is fo abfolutely vefted in the vendee, that if A fells a horfe to B for 10 l, and B pays him earneft, or figns a note in writing of the bargain; and afterwards, before the delivery of the horfe or money paid, the horfe dies in the vendor's cuftody; ftill he is entitled to the money, becaufe by

.{FS}
^w Inft. 3. tit. 24.
^x Noy. ibid.
^y Stiernhook de jure Gotl. l. 2. c. 5.
^z Hob. 41.
.{FE}
the
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the contract, the property was in the vendee ^a. Thus may property in goods be transferred by fale, where the vendor hath fuch property in himfelf.

BUT property may alfo in fome cafes be transferred by fale, though the vendor hath none at all in the goods: for it is expedient that the buyer, by taking proper precautions, may at all events be fecure of his purchafe; otherwife all commerce between man and man muft foon be at an end. And therefore the general rule of law is ^b, that all fales and contracts of any thing vendible, in fairs or markets overt, (that is, open) fhall not only be good between the parties, but alfo be binding on all thofe that have any right or property therein. And for this purpofe, the mirroir informs us ^c, were tools eftablifhed in markets, viz. to teftify the making of contract; for every private contract was difcountenanced by law. Wherefore our Saxon anceftors prohibited the fale of any thing above the value of twenty pence, unlefs in open market, and directed every bargain and fale to be contracted in the prefence of credible witneffes^d. Market overt in the country is only held on the fpecial days, provided for particular towns by charter or prefcription; but in London every day, except Sunday, is market day ^c. The market place, of fpot of ground fet apart by cuftom for the fale of particular goods, is alfo in the country the only market overt ^f; but in London every fhop in which goods are expofed publicly to fale, is market overt, for fuch things only as the owner profeffes to trade in ^g. But if my goods are ftolen from me, and fold, out of market overt, my property is not altered, and I may take them wherever I find them. And it is expreffly provided by ftatute 1 Jac. I. c. 21. that the fale of any goods wrongfully taken, to any pawnbroker in London or within two miles thereof, fhall not alter the property. For this, being ufually a clandeftine trade, is therefore made an

.{FS}
^a Noy, c. 42.
^b 2 Inft. 713.
^c c. 1. §. 3.
^d LL. Ethel. 10, 12. LL. Eadg. Wilk. 80.
^e Cro. Jac. 68.
^f Godb. 131.
^g 5 Rep. 83. 12 Mod. 521.
.{FE}

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excep-

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exception to the general rule. And, even in market overt, if the goods be the property of the king, fuch fale (though regular in all other refpect) will in no cafe bind him; though it binds infants, feme coverts, ideots or lunatics, and men beyond fea or in prifon: or if the goods be ftolen from a common perfon, and then taken by the king's officer from the felon, and fold in open market; ftill, if the owner has ufed due diligence in profecuting the thief to conviction, he lofes not his property in the goods ^h. So likewife, if the buyer knoweth the property not to be in the feller; or there be any other fraud in the tranfaction; if he knoweth the feller to be an infant, or feme covert, not ufually trading for herfelf; if the fale be not originally and wholly made in the fir or market, or not at the ufual hours; the owner's property is not bound thereby ⁱ. If a man buys his own goods in a fair or market, the contract of fale fhall not bind him fo as that he fhall render the price, unlefs the property had been previoufly altered by a former fale ^k. And, notwithftanding any number of intervening fales, if the original vendor, who fold without having the property, comes again into poffeffion of the goods, the original owner may take them, when found in his hands who was guilty of the firft breach of juftice ^l. By which wife regulations the common law has fecured the right of the proprietor in perfonal chattels from being devefted, for far as was confiftent with that other neceffary policy, that purchafors, bona fide, in a fair, open, and regular manner, fhould not be afterwards put to difficulties by reafon of the previous knavery of the feller.

BUT there is one fpecies of perfonal chattels, in which the property is not eafily altered by fale, without the exprefs confent of the owner, and thofe are horfes; the fale of which, even in fairs or market sovert, is void in many inftances, where that of other property is valid: becaufe a horfe is fo fleet an animal, that the ftealers of them may flee far off in a fhort fpace^m, and

.{FS}
^h Bacon's ufe of the law. 158.
ⁱ 2 Inft. 713, 714.
^k Perk. §. 93.
^l 2 Inft. 713.
^m Ibid. 714.
.{FE}
be
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Ch. 30.
be out of the reach of the moft induftrious owner. All perfons therefore that have occafion to deal in horfes, and are therefore liable fometimes to buy ftolen ones, would do well to obferve, that whatever price they may give, or how long foever they may keep poffeffion before it be claimed, they gain no property in a horfe that has been ftolen, unlefs it be bought in a fair or market overt: nor even then, unlefs the directions be purfued that are laid down in the ftatute 2 P. & M. c. 7. and 31 Eliz. c. 12. By which it is enacted, that every horfe, fo to be fold, fhall be openly expofed, in the time of fuch fair or market, for one whole hour together, between ten in the morning and funfet, in the open and public place ufed for fuch fales, and not in any private yard or ftable: that the horfe fhall be brought by both the vendor and vendee to the tollgatherer or bookkeeper of fuch fair or market: that toll be paid, if any be due; and if not, one penny to the bookkeeper, who fhall enter down the price, colour, and marks of the horfe, with the names additions, and abode of the vendee and the vendor; the latter either upon his own knowlege, or the teftimony of fome credible witnefs. And, even if all thefe points be fully complied with, yet fuch fale fhall not take away the property of the owner, if within fix months after the horfe if ftolen he puts in his claim before the mayor, or fome juftice, of the diftrict in which the horfe fhall be found; and within forty days after that, proves fuch his property by the oath of two witneffes before fuch mayor or juftice; and alfo tenders to the perfon in poffeffion fuch price as he bona fide paid for him in market overt. But in cafe any one of the points beforementioned be omitted, or not obferved in the fale, fuch fale is utterly void; and the owner fhall not lofe his property, but at any diftance of time may feife or bring an action for his horfe, wherever he happens to find him. Wherefore fir Edward Coke obferves ⁿ, that, both by the common law and thefe two ftatutes, the property of horfes is fo well preferved, that if the owner be of capacity to underftand them, and be vigilant and induftrious to purfue the fame, it is almoft impoffible that the property of any horfe, either

.{FS}
ⁿ 2 Inft. 719.

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ftolen or not ftolen, fhould be altered by any fale in market overt by him that is malae fidei poffeffor.

BY the civil law ^o an implied warranty was annexed to every fale, in refpect to the title of the vendor: and fo too, in our law, a purchafor of goods and chattels may have a fatisfaction from the feller, if he fells them as his own, and the title proves deficient, without any exprefs warranty for that purpofe^p. But, with regard to the goodnefs of the wares fo purchafes, the vendor is not bound to anfwer; unlefs he expreffly warrants them to be found and good ^q, or unlefs he knew them to be otherwife and hath ufed any art to difguife them ^r, or unlefs they turn out to be different from what he reprefented to the buyer.

2. BAILMENT, from the French bailer, to deliver, is a delivery of goods in truft, upon a contract expreffed or implied, that the fruft fhall be faithfully executed on the part of the bailee. As if cloth be delivered, or (in our legal dialect) bailed, to a taylor to make a fuit of cloaths, he has it upon an implied contract to render it again when made, and that in workmanly manner ^s. If money or goods be delivered to a common carrier, to convey from Oxford to London, he is under a contract in law to pay, or carry, them to the perfon appointed ^t. If a horfe, or other goods, be delivered to an inn-keeper or his fervants, he is bound to keep them fafely, and reftore them when his gueft leaves the houfe ^u. If a man takes in a horfe, or other cattle, to graze and depafture in his grounds, which the law calls agiftment, he takes them upon an implied contract to return them fafe to the owner ^w. if a pawnbroker receives plate or jewels as a pledge, or fecurity, for the repayment of money lent thereon at a day certain, he has them upon an exprefs contract or condition to reftore them, if the pledgor performs his part by redeeming them in due time ^x: for the due execution of which

.{FS}
^o Ff. 21. 2. 1.
^p Cro. Jac. 474. 1 Roll. Abr. 90.
^q F. N. B. 94.
^r 2 Roll. Rep. 5.
^s 1 Vern. 268.
^t 12 Mod. 482.
^u Cro. Eliz. 622.
^w Cro. Car. 271.
^x Cro. Jac. 245. Yelv. 178.
.{FE}
contract
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BOOK II.
Ch. 30.
contract many ufeful regulations are made by ftatute 30 Geo. II. c. 24. And fo if a landlord diftreins goods for rent, or a parifh officer for taxes, thefe for a time are only a pledge in the hands of the diftreinors, and they are bound by an implied contract in law to reftore them on payment of the debt, duty, and expenfes, before the time of fale; or, when fold, to render back the overplus. If a friend delivers any thing to his friend to keep for him, the receiver is bound to reftore it on demand: and it was formerly held that in the mean time he was anfwerable for any damage or lofs it might fuftain, whether by accident or otherwife ^y; unlefs he expreffly undertook ^z to keep it only with the fame care as his own goods, and then he fhould not be anfwerable for theft or other accidents. But now the law feems to be fettled upon a much more rational footing ^a; that fuch a general bailment will not charge the bailee with any lofs, unlefs it happens by grofs neglect, which is conftrued to be an evidence of fraud: but, if the bailee undertakes fpecially to keep the goods fafely and fecurely, he is bound to anfwer all perils and damages, that may befall them for want of the fame care with which a prudent man would keep his own^b.

In all thefe inftances there is a fpecial qualified property tranfferred from the bailor to the bailee, together with the poffeffion. It is not an abfolute property in the bailee, becaufe of his contract for reftitution; and the bailor hath nothing left in him but the right to a chofe in action, grounded upon fuch contract, the poffeffion being delivered to the bailee. And, on account of this qualified property of the bailee, he may (as well as the bailor) maintain an action againft fuch as injure or take away thefe chattels. The taylor, the carrier, the innkeeper, the agifting farmer, the pawnbroker, the diftreinor, and the general bailee, may all

.{FS}
^y Co. Litt. 89.
^z 4 Rep. 84.
^a Lord Raym. 909. 12 Mod. 487.
^b By the laws of Sweden, the depofitary or bailee of goods is not bound to reftitution, in cafe of accident by fire or theft; provided his own goods perifhed in the fame manner: “jura enim noftra, fays Stiernhook, dolum pracfumunt, fi una non pereant.” (De jure Sueon. l. 2. c. 5.)
.{FE}
of
.P 454
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BOOK II.
Ch. 30.
of them vindicate, in their own right, this their poffeffory intereft, againft any ftranger or third perfon ^c. For, as fuch bailee is refponfible to the bailor, if the goods are loft damaged by his willful default or grofs negligence, or if he do not deliver up the chattels on lawful demand, it is therefore reafonable that he fhould have a right to recover either the fpecific goods, or elfe a fatisfaction in damages, againft all other perfons, who may have purloined or injured them; that he may always be ready to anfwer the call of the bailor.

3. HIRING and borrowing are alfo contract by which a qualified property may be transferred to the hirer or borrower: in which there is only this difference, that hiring is always for a price, a ftipend, or additional recompenfe; borrowing is merely gratuitous. But the law in both cafes is the fame. They are both contracts, whereby the poffeffion and a tranfient property is transferred for a particular time or ufe, on condition and agreement to reftore the goods fo hired or borrowed, as foon as the time is expired or ufe performed; together with the price or ftipend (in cafe of hiring) either expreffly agreed on by the parties, or left to be implied by law according to the value of the fervice. By this mutual contract, the hirer or borrower gains a temporary property in the thing hired, accompanied with an implied condition to ufe in with moderation and not abufe it; and the owner or lender retains a reverfionary intereft in the fame, and acquires a nmew property in the price or reward. Thus if a man hires or borrows a horfe for a month, he has the poffeffion and a qualified property therein during that period; on the expiration of which his qualified property determines, and the owner becomes (in cafe of hiring) intitled to the premium or price, for which the horfe was hired ^d.

THERE is one fpecies of this price or reward, the moft ufual of any, but concerning which many good and learned men have

.{FS}
^c 13 Rep. 69.
^d Yelv. 172. Cro. Jac. 236.
.{FE}
in
.P 455
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BOOK II.
Ch. 30.
in former times very much perplexed themfelves and other people, by raifing doubts about it's legality in foro confcientiae. That is, when money is lent on a contract to receive not only the principal fum again, but alfo an increafe by way of compenfation for the ufe; which is generally called intereft by thofe who think it lawful, and ufury by thofe who do not fo. It may not be amifs therefore to enter into a fhort enquiry, upon what footing this matter of intereft or ufury does really ftand.

THE enemies to intereft in general make no diftinction between that and ufury, holding any increafe of money to be indefenfibly ufurious. And this they ground as well on the prohibition of it by the law of Mofes among the Jews, as alfo upon what is laid down by Ariftotle ^e, that money is naturally barren, and to make it breed money is prepofterous, and a perverfion of the end of it's inftitution, which was only to ferve the purpofes of exchange, and not of increafe. Hence the fchool divines have branded the practice of taking intereft, as being contrary to the divine law both natural and revealed; and the canon law ^f, has profcribed the taking any, the leaft, increafe for the loan of money as a mortal fin.

BUT, in anfwer to this, it may be obferved, that the mofaical precept was clearly a political, and not a moral precept. It only prohibited the Jews from taking ufury from their brethren the Jews; but in exprefs words permitted them to take it of a ftranger ^g: which proves that the taking of moderate ufury, or a reward for the ufe, for fo the word fignifies, is not malum in fe, fince it was allowed where any but an Ifraelite was concerned. And as to Ariftotle's reafon, deduced from the natural barrennefs of money, the fame may with equal force be alleged of houfes, which never breed houfes; and twenty other things, which nobody doubts it is lawful to make profit of, by letting them to

.{FS}
^e Polit. l. 1. c. 10.
^f Decretal. l. 5. tit. 19.
^g “Unto a ftranger thou mayeft lend upon ufury, but unto thy brother thou fhalt not lend upon ufury.” Deut. xxiii. 20.
.{FE}
hire.
.P 456
The RIGHTS of THINGS
BOOK II.
Ch. 30.
hire. And though money was originally ufed only for the purpofes of exchange, yet the laws of any ftate may be well juftified in permitting it to be turned to the purpofes of profit, if the convenience of fociety (the great end for which money was invented) fhall require it. And that the allowance of moderate intereft tends greatly to the benefit of the public, efpecially in a trading country, will appear from that generally acknowleged principle, that commerce cannot fubfift without mutual and extenfive credit. Unlefs money therefore can be borrowed, trade cannot be carried on: and if no premium were allowed for the hire of money, few perfons would care to lend it; or at leaft the cafe of borrowing at a fhort warning (which is the life of commerce) would be entirely at an end. Thus, in the dark ages of monkifh fuperftition and civil tyranny, when intereft was laid under a total interdict, commerce was alfo at it's loweft ebb, and fell entirely into the hands of the Jews and Lombards: but when men's minds began to be more enlarged, when true religion and real liberty revived, commerce grew again into credit; and again introduced with itfelf it's infeparable companion, the doctrine of loans upon intereft.

AND, really, confidered abftractedly from this it's ufe, fince all other conveniences of life may either be bought or hired, but money can only be hired, there feems no greater impropriety in taking a recompenfe or price for the hire of this, than of any other convenience. If I borrow 100 l. to employ in a beneficial trade, it is but equitable that the lender fhould have a proportion of my gains. To demand an exorbitant price is equally contrary to confcience, for the loan of a horfe, or the loan of a fum of money: but a reafonable equivalent for the temporary inconvenience the owner may feel by the want of it, and for the hazard of his lofing it entirely, if not more immoral in one cafe than it is in the other. And indeed the abfolute prohibition of lending upon any, even moderate intereft, introduces thevery inconvenience which it feems meant to remedy. The neceffity of individuals will make borrowing unavoidable. Without fome profit allowed
by

.P 457
The RIGHTS of THINGS
BOOK II.
Ch. 30.
by law there will be but few lenders: and thofe principally bad men, who will break through the law, and take a profit; and then will endeavour to indemnify themfelves from the danger of the penalty, by making that profit exorbitant. Thus, while all degrees of profit were difcountenanced, we find more complaints of ufury, and more flagrant inftances of oppreffion, than in modern times, when money may be eafily had at a low intereft. A capital diftinction muft therefore be made between a moderate and exorbitant profit; to the former of which we ufually give the name of intereft, to the latter the truly odious appellation of ufury: the former is neceffary in every civil ftate, if it were but to exclude the latter, which ought never to be tolerated in any well-regulated fociety. For, as the whole of this matter is well fumed up by Grotius^h, “if the compenfation allowed by law does not exceed the proportion of the hazard run, or the want felt, by the loan, it's allowance is neither repugnant to the revealed nor the natural law: but if it exceeds thofe bounds, it is then oppreffive ufury; and though the municipal laws may give it impunity, they never can make it juft.”

WE fee, that the exorbitance or moderation of intereft, for money lent, depends upon two circumftances; the inconvenience of parting with it for the prefent, and the hazard of lofing it entirely. The inconvenience to individual lenders can never be eftimated by laws; the rate therefore of general intereft muft depend upon the ufual or general inconvenience. This refults entirely from the quantity of fpecie or current money in the kingdom: for, the more fpecie there is circulating in any nation, the greater fuperfluity there will be, beyond what is neceffary to carry on the bufinefs of exchange and the common concerns of life. In every nation or public community there is a certain quantity of money thus neceffary; which a perfon well fkilled in political arithmetic might perhaps calculate as exactly, as a private banker can the demand for running cafh in his own fhop: all above this necef-

.{FS}
^h de j. b. & p. l. 2. c. 12. §. 22.
.{FE}

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K k k

fary

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Ch. 30.
fary quantity may be fpared, or lent, without much inconvenience to the refpective lenders; and the greater this national fuperfluity is, the more numerous will be lenders, and the lower ought the rate of the national intereft to be: but where there is not enough, or barely enough, circulating cafh, to anfwer the ordinary ufes of the public, intereft will be proportionably high; for lenders will be but few, as few can fubmit to the inconvenience of lending.

SO alfo the hazard of an entire lofs has it's weight in the regulation of intereft: hence, the better the fecurity, the lower will the intereft be; the rate of intereft being generally in a compound ratio, formed out of the inconvenience and the hazard. And as, if there were no inconvenience, there fhould be no intereft, but what is equivalent to the hazard; fo, if there were no hazard, there ought to be no intereft, fave only what arifes from the mere inconvenience of lending. Thus, if the quantity of fpecie in a nation be fuch, that the general inconvenience of lending for a year is computed to amount to three per cent: a man that has money by him will perhaps lend it upon good perfonal fecurity at five per cent, allowing two for the hazard run; he will lend it upon landed fecurity, or mortgage, at four per cent, the hazard being proportionably lefs; but he will lend it to the ftate, on the maintenance of which all his property depends, at three per cent, the hazard being none at all.

BUT, fometimes the hazard may be greater, than the rate of intereft allowed by law will compenfate. And this give rife to the practice, 1. Of bottomry, or refpondentia. 2. Of policies of infurance.

AND firft, bottomry (which originally arofe from permitting the mafter of a fhip, in a foreign country, to hypothecate the fhip in order to raife money to refit) is in the nature of a mortgage of a fhip; when the owner takes up money to enable him to carry on his voyage, and pledges the keel or bottom of the fhip
(pars
.P 459
The RIGHTS of THINGS
BOOK II.
Ch. 30.
(pars pro toto) as a fecurity for the repayment. In which cafe it is underftood, that, if the fhip be loft, the lender lofes alfo his whole money; but, if it returns in fafety, then he fhall receive back his principal, and alfo the premium or intereft agreed upon, however it may exceed the legal rate of intereft. And this is allowed to be a valid contract in all trading nations, for the benefit of commerce, and by reafon of the extraordinary hazard run by the lender ⁱ. And in this cafe the fhip and tackle, if brought home, are anfwerable (as well as the perfon of the borrower) for the money lent. But if the loan is not upon the veffel, but upon the goods and merchandize, which muft neceffarily be fold or exchanged in the courfe of the voyage, then only the borrower, perfonally, is bound to anfwer the contract; who therefore in this cafe is faid to take up money at refpondentia. Thefe terms are alfo applied to contracts for the repayment of money borrowed, not on the fhip and goods only, but on the mere hazard of the voyage itfelf; when a man lends a merchant 1000 l. to be employed in a beneficial trade, with condition to be repaid with extraordinary intereft, in cafe fuch a voyage be fafely performed ^k: which kind of agreement is fometimes called foenus nauticum, and fometimes ufura maritime ^l. But, as this gave an opening for ufurious and gaming contracts, efpecially upon long voyages, it was enacted by the ftatute 19 Geo. II. c. 37. that all monies lent on bottomry or at refpondentia, on veffels bound to or from the Eaft Indies, fhall be expreffly lent only upon the fhip or upon the merchandize; that the lender fhall have the benefit of falvage; and that, if the bborrower has not on board effects to the value of the fum borrowed, he fhall be refponfible to the lender for fo much of the principal as hath not been laid out, with legal intereft and all other charges, though the fhip and merchandize be totally loft.

.{FS}
ⁱ Moll. de jur. mar. 361. Malyne lex mercat. b. 1. c. 31. Cro. Jac. 208. Bynkerft. quaeft. jur. privat. l. 3. c. 16.
^k 1 Sid. 27.
^l Molloy ibid. Malyne ibid.
.{FE}

K k k 2

SECONDLY,

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Ch. 30.
SECONDLY, a policy of infurance is a contract between A and B, that, upon A's paying a premium equivalent to the hazard run, B will indemnify or infure him againft a particular event. This is founded upon one of the principles as the doctrine of intereft upon loans, that of hazard; but not that of inconvenience. For if I calculate the chance that fhe performs her voyage to be twenty to one againft her being loft: and, if fhe be loft, I lofe 100 l. and get 5 l. Now this is much the fame as if I lend the merchant, whofe whole fortunes are embarked in this vefffel, 100 l. at the rate of eight per cent. For by a loan I fhould be immediately out of my money, the inconvenience of which we have computed equal to three per cent: if therefore I had actually lent him 100 l, I muft have added 3 l. on the fcore of inconvenience, to the 5 l. allowed for the hazard; which together would have made 8 l. But as, upon an infurance, I am never out of my money till the lofs actually happens, nothing is therein allowed upon the principle of inconvenience, but all upon the principle of hazard. Thus too, in a loan, if the chance of repayment depends upon the borrower's live, it is frequent (befides the the ufual rate of intereft) for the borrower to have his life infured till the time of repayment; for which he is loaded with an additional premium, fuited to his age and conftitution. Thus, if Sempronius has only an annuity for his life, and would borrow 100 l. of Titius for a year; the inconvenience and general hazard of this loan, we have feen, are equivalent 10 5 l. which is therefore the legal intereft: but there is alfo a fpecial hazard in this cafe ; for, if Sempronius dies within the year, Titius must lofe the whole of his 100 l. Suppofe this chance to be as one to ten: it will follow that the extraordinary hazard is worth 10 l. more; and therefore that the reafonable rate of intereft in this cafe would be fifteen per cent. But this the law, to avoid abufes, will not permit to be taken: Sempronius therefore gives Titius the lender only 5 l, the legal intereft; but applies to Gaius an infurer, and gives him the other 10 l. to indemnify Titius againft
the
.P 461
The RIGHTS of THINGS
BOOK II.
Ch. 30.
the extraordinary hazard. And in this manner may any extraordinary or particular hazard be provided againft, which the eftablifhed rate of intereft will not reach; that being calculated by the ftate to anfwer only the ordinary and general hazard, together with the lender's inconvenience in parting with his fpecie for the time.

THE learning relating to marine infurances hath of late years been greatly improved by a feries of judicial decifions, which have now eftablifhed the law in fuch a variety of cafes, that (if well and judicioufly collected) they would form a very complete title in a code of commercial jurifprudence. But, being founded on equitable principles, which chiefly refult from the fpecial circumftances of the cafe, it is not eafy to reduce them to any general heads in mere elementary inftitutes. Thus much may however be faid; that, being contracts, the very effence of which confifts in obferving the pureft good faith and integrity, they are vacated by any the leaft fhadow of fraud or undue concealment: and, on the other hand, being much for the benefit and extenfion of trade, by diftributing the lofs or gain among a number of adventurers, they are greatly encouraged and protected both by common law and acts of parliament. But, as a practice had obtained of infuring large fums without having any property on board, which were called infurances, intereft or no intereft; and alfo of infuring the fame goods feveral times over; both of which were a fpecies of gaming, without any advantage to commerce, and were denominated wagering policies: it is therefore enacted by the ftatute 19 Geo. II. c. 37. that all infurances, intereft or no intereft, or without farther proof of intereft than the policy itfelf, or by way of gaming or wagering, or without benefit of falvage to the infurer, (all which had the fame pernicious tendency) fhall be totally null and void, except upon privateers, or fhips in the Spanifh and Portuguefe trade, for reafons fufficiently obvious; and that no re-affurance fhall be lawful, except the former infurer fhall be involvent, a bankrupt, or dead; and laftly that, in the Eaft India trade, the lender of money on bottomry, or at refpondentia, fhall
alone
.P 462
The RIGHTS of THINGS
BOOK II.
Ch. 30.
alone have a right to be infured for the money lent, and the borrower fhall (in cafe of a lofs) recover no more upon any infurance that the furplus of his property, above the value of his bottomry or refpondentia bond. But, to return to the doctrine of common intereft on loans:

UPON the two principles of inconvenience and hazard, compared together, different nations have at different times eftablifhed different rates of intereft. The Romans at one time allowed centefimae, or twelve per cent, to be taken for common loans; but Juftinian^m reduced it to trientes, or one third of the as or centefimae, that is, four per cent; but allowed higher intereft to be taken of merchants, becaufe there the hazard was greaterⁿ. So too Gro-

.{FS}
^m Cod. 4. 32. 26. Nov. 33, 34, 35.
ⁿ A fhort explication of thefe terms, and of the divifion of the Roman as, will be ufeful to the ftudent, not only for underftanding the civilians, but alfo the more claffical writers, who perpetually refer to this diftribution. Thus Horace, ad Pifones. 325.

Romani pueri longis rationibus affem
Difcunt in partes centum diducere. Dicat
Filius Albini, fi de quincunce remota eft
Uncia, quid fuperet ? poterat dixiffe, triens: eu,
Rem poteris fervare tuam ! redit uncia, quid fit ?
Semis.–––––––

It is therefore to be obferved, that, in calculating the rate of intereft, the Romans divided the principal fum into an hundred parts; one of which they allowed to be taken monthly: and this, which was the higheft rate of intereft permitted, they called ufurae centefimae, amounting yearly to twelve per cent. Now as the as, or Roman pound, was commonly ufed to exprefs any integral fum, and was divifible into twelve parts or unciae, therefore thefe twelve monthly payments or unciae were held to amount annually to one pound, or as ufurarius; and fo the ufurae affes were fynonymous to the ufurae centefimae. And all lower rates of intereft were denominated according to the relation they bore to this centefimal ufury, or ufurae affes: for the feveral multiples of the unciae, or duodecimal parts of the as, were known by different names according to their different combinations; fextans, quadrans, triens, quincunx, femis, feptunx, bes, dodrans, dextrans, deunx, containing refpectively 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, unciae or duodecimal parts of an as. (Ff. 28. 5. 50. §. 2. Gravin. orig. jur. civ. l. 2. §. 47.) This being premifed, the following table will clearly exhibit at once the fubdivifions of the as, and the denominations of the rate of intereft.
USURAE
.P 463
The RIGHTS of THINGS
BOOK II.
Ch. 30.
tius informs us ^o, that in Holland the rate of intereft was then eight per cent in common loans, but twelve to merchants. Our law eftablifhes one ftandard for all alike, where the pledge or fecurity itfelf is not put in jeopardy; left, under the general pretence of vague and indeterminate hazards, a door fhould be opened to fraud and ufury: leaving fpecific hazards to be provided againft by fpecific infurances, or by loans upon refpondentia, or bottomry. But as to the rate of legal intereft, it has varied and decreafed for two hundred years paft, according as the quantity of fpecie in the kingdom has encreafed by acceffions of trade, the introduction of paper credit, and other circumftances. The ftatute 37 Hen. VIII. c. 9. confined intereft to ten per cent, and fo did the ftatute 13 Eliz. c. 8. But as, through the encouragements given in her reign to commerce, the nation grew more wealthy, fo under her fucceffors the ftatute 21 Jac. I. c. 17. reduced it to eight per cent; as did the ftatute 12 Car. II. c. 13. to fix: and laftly by the ftatute 12 Ann. ft. 2. c. 16. it was brought down to five per cent yearly, which is now the extremity of legal intereft that can be taken. But yet, if a contract, which carries intereft, be made in a foreign country, our courts will direct the payment of intereft according to the law of that country in which the contract was made ^p. Thus Irifh, American,

.{FS}

	USURAE				PARTES ASSIS.			PER ANNUM.
	Affes, five centefimae	–––––––––	integer	–––––––––––	12 per cent.
	Deunces			–––––––––	11/12		–––––––––––	11
	Dextances, vel decunces	–––––––––	5/6		–––––––––––	10
	Dodrantes		–––––––––	3/4		–––––––––––	9
Beffes			–––––––––	2/3		–––––––––––	8
	Septunces		–––––––––	7/12		–––––––––––	7
	Semiffes			–––––––––	1/2		–––––––––––	6
	Quincunces		–––––––––	5/12		–––––––––––	5
	Trientes			–––––––––	1/3		–––––––––––	4
	Quandrantes		–––––––––	1/4		–––––––––––	3
	Sextances			–––––––––	1/6		–––––––––––	2
	Unciae			–––––––––	1/12		–––––––––––	1

^o de jur. b. & p. 2. 12. 22.
^p 1 Equ. Caf. abr. 289. 1 P. W^ms. 395.
.{FE}
Turkifh,
.P 464
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BOOK II.
Ch. 30.
Turkifh, and Indian intereft, have been allowed in our courts, to the amount of even twelve per cent. For the moderation or exorbitance of intereft depends upon local circumftances; and the refufal to inforce fuch contracts would put a ftop to all foreign trade.

4. THE laft general fpecies of contracts, which I have to mention, is that of debt; whereby a chofe in action, or right to a certain fum of money, is mutually acquired and loft ^q. This may be the counterpart of, and arife from, any of the other fpecies of contracts. As, in cafe of a fale, where the price is not paid in ready money, the vendee becomes, indebted to the vendor for the fum agreed on; and the vendor has a property in this price, as a chofe in action, by means of this contract of debt. In bailment, if the bailee lofes or detains a fum of money bailed to him for any fpecial purpofe, he becomes indebted to the bailor in the fame numerical fum, upon his implied contract, that he fhall execute the truft repofed in him, or repay the money to the bailor. Upon hiring or borrowing, the hirer or borrower, at the fame time that he acquires a property in the thing lent, may alfo become indebted to the lender, upon his contract to reftore the money borrowed, to pay the price or premium of the loan, the hire fo the horfe, or the like. Any contract in fhort whereby a determinate fum of money becomes due to any perfon, and is not paid but remains in action merely, is a contract of debt. And, taken in this light, in comprehends a great variety of acquifition; being ufually divided into debts of record, debts by fpecial, and debts by fimple contract.

A DEBT of record is a fum of money, which appears to be due by the evidence of a court of record. Thus, when any fpecific fum is adjudged to be due from the defendant to the plaintiff, on an action or fuit at law; this is a contract of the higheft nature, being eftablifhed by the fentence of a court of judicature. Recognizances alfo are a fum of money, recognized or acknowleged to be due to the

.{FS}
^q F. N. B. 119.
.{FE}
crown
.P 465
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BOOK II.
Ch. 30.
crown or a fubject, in the prefence of fome court or magiftrate, with a condition that fuch acknowlegement fhall be void upon the appearance of the party, his good behaviour, or the like: and thefe, together with ftatutes merchant and ftatutes ftaple, &c, it forfeited by non-performance of the condition, are alfo ranked among this firft and principal clafs of debts, viz. debts or record; fince the contract, on which they are founded, is witneffed by the higheft kind of evidence, viz. by matter of record.

DEBTS by fpecialty, or fpecial contract, are fuch whereby a fum of money becomes, or is acknowleged to be, due by deed or inftrument under feal. Such as by deed of covenant, by deed of fale, by leafe referving rent, or by bond or obligation: which laft we took occafion to explain in the twentieth lecture of the prefent book; and then fhewed that it is an acknowlegement or creation or a debt from the obligor to the obligee, unlefs the obligor performs a condition thereunto ufually annexed, as the payment of rent or money borrowed, the obfervance of a covenant, and the like; on failure of which the bond becomes forfeited and the debt becomes due in law. Thefe are looked upon as the next clafs of debts after thofe of record, being confirmed by fpecial evidence, under feal.

DEBTS by fimple contract are fuch, where the contract upon which the obligation arifes is neither afcertained by matter of record, nor yet by deed or fpecial inftrument, but by mere oral evidence, the moft fimple of any; or by notes unfealed, which are capable of a more eafy proof, and (therefore only) better, than a verbal promife. It is eafy to fee into what a vaft variety of obligations this laft clafs may be branched out, through the numerous contracts for money, which are not only expreffed by the parties, but virtually implied in law. Some of thefe we have already occafionally hinted at; and the reft, to avoid repetition, muft be referred to thofe particular heads in the third book of thefe commentaries, where the breach of fuch contracts will be

VOL. II.

L l l

confidered.

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confidered. I fhall only obferve at prefent, that by the ftatute 29 Car. II. c. 3. no executor or adminiftrator fhall be charged upon any fpecial promife to anfwer damages out of his own eftate, and no perfon fhall be charged upon any promife to anfwer for the debt of default of another, or upon any agreement in confideration of marriage, or upon any contract or fale of any real eftate, or upon any agreement that is not be performed within one year from the making, unlefs the agreement or fome memorandum thereof be in writing, and figned by the party himfelf or by his authority.

BUT there is one fpecies of debts upon fimple contract, which, being a tranfaction now introduced into all forts of civil life, under the name of paper credit, deferves a more particular regard. Thefe are debts by bills of exchange, and promiffory notes.

A BILL of exchange is a fecurity, originally invented among merchants in different countries, for the more eafy remittance of money from the one to the other, which has fince fpread itfelf into almoft all pecuniary tranfactions. It is an open letter of requeft from one man to another, defiring him to pay a fum named therein to a third perfon on his account; by which means a man at the moft diftant part of the world may have money remitted to him from any trading country. If A lives in Jamaica, and owes B who lives in England 1000 l, now if C be going from England of Jamaica, he may pay B this 1000 l, and take a bill of exchange drawn by B in England upon A in Jamaica, and receive it when he comes thither. Thus does B receive his debt, at any diftance of place, by transferring it to C; who carries over his money in paper credit, without danger of robbery or lofs. This method is faid to have been brought into general ufe by the Jews and Lombards, when banifhed for their ufury and other vices; in order the more eafily to draw their effects out of France and England, into thofe countries in which they had chofen to refide. The invention of them was a little earlier: for the Jews were banifhed out Guienne in 1287, and out
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of England in 1290^r; and in 1236 the ufe of paper credit was introduced into the Mogul empire in China ^s. In common fpeech fuch a bill is frequently called a draught, but a bill of exchange is the more legal as well as mercantile expreffion. The perfon however, who writes this letter, is called in law the drawer, and he to whom it is written the drawee; and the third perfon, or negotiator, to whom it is payable (whether fpecially named, or the bearer generally) is called the payee.

THESE bills are either foreign, or inland: foreign, when drawn by a merchant refiding abroad upon his correfpondent in England, or vice verfa; and inland, when both the drawer and the drawee refide within the kingdom. Formerly foreign bills of exchange were much more regarded in the eye of the law than inland ones, as being thought of more public concern in the advancement of trade and commerce. But now by two ftatutes, the one 9 & 10 W. III. c. 17. the other 3 & 4 Ann. c. 9. inland bills of exchange are put upon the fame footing as foreign ones; what was the law and cuftom of merchants with regard to the one, and taken notice of merely as fuch ^t, being by thofe ftatutes expreffly enacted with regard to the other. So that there is now in law no manner of difference between them.

PROMISSORY notes, or notes of hand, are a plain and direct engagement in writing, to pay a fum fpecified at the time therein limited to a perfon therein named, or fometimes to his order, or often to the bearer at large. Thefe alfo by the fame ftatute 3 & 4 Ann. c. 9. are made affignable and indorfabble in like manner as bills of exchange.

THE payee, we may obferve, either of a bill of exchange or promiffory note, has clearly a property vefted in him (not indeed in poffeffion but in action) by the exprefs contract of the drawer in the cafe of a promiffory note, and, in the cafe of a bill of exchange, by his implied contract; viz. that, provided the drawee

.{FS}
^r 2 Carte. 203. 206.
^s Mod. Un. Hift. iv. 499.
^t 1 Roll. Abr. 6.
.{FE}

L l l 2

does

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does not pay the bill, the drawer will: for which reafon it is ufual, in bills of exchange, to exprefs that the value thereof hath been received by the drawer ^u; in order to fhew the confideration, upon which the implied contract of repayment arifes. And this property, fo vefted, may be transferred and affigned from the payee to any other man; contrary to the general rule of the common law, that no chofe in action is affignable: which affignment is the life of paper credit. It may therefore be of fome ufe, to mention a few of the principal incidents attending this transfer or affignment, in order to make it regular, and thereby to change the drawer with the payment of the debt to other perfons, than thofe with whom be originally contracted.

IN the firft place then the payee, or perfon to whom or whofe order fuch bill of exchange or promiffory note is payable, may by indorfement, or writing his name in dorfo or on the back of it, affign over his whole property to the bearer, or elfe to another perfon by name, either of whom is then called the indorfee; and he may affign the fame to another, and fo on in infinitum. And a promiffory note, payable to A or bearer, is negotiable without any indorfement, and payment thereof may be demanded by any bearer of it ^v. But, in cafe of a bill of exchange, the payee, or the indorfee, (whether it be a general or particular indorfement) is to go to the drawee, and offer his bill for acceptance; which acceptance (fo as to charge the drawer with cofts) muft be in writing, under or on the back of the bill. If the drawee accepts the bill, either verbally or in writing ^w, he then makes himfelf liable to pay it; this being now a contract on his fide, grounded on an acknowlegement that the drawer has effects in his hands, or at leaft credit fufficient to warrant the payment. If the drawee refufes to accept the bill, and it be of the value of 20 l. or upwards, and expreffed to be for value received, the payee or indorfee may proteft if for non-acceptance: which proteft muft be made in writing, under a copy of fuch bill

.{FS}
^uStra. 1212.
^v 2 Show. 235. – Grant v. Vaughan. T. 4 Geo. III. B. R.
^w Stra. 1000.
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of exchange, by fome notary public; or, if no fuch notary be refident in the place, then by any other fubftantial inhabitant in the prefence of two credible witneffes; and notice of fuch proteft muft, within fourteen days after, be given to the drawer.

BUT, in cafe fuch bill be accepted by the drawee, and after acceptance he fails or refufes to pay it within three days after it becomes due (which three days are called days of grace) the payee or indorfee is then to get in protefted for non-payment, in the fame manner and by the fame perfons who are to proteft it in cafe of non-acceptance: and fuch proteft muft alfo be notified, within fourteen days after, to the drawer. And he, on producing fuch proteft, either of non-acceptance or non-payment, is bound to make good to the payee, or indorfee, not only the amount of the faid bills, (which he is bound to do within a reafonable time after non-payment, without any proteft, by the rules of the common law ^x) but alfo intereft and all charges, to be computed from the time of making fuch proteft. But if no proteft be made or notified to the drawer, and any damage accrues by fuch neglect, it fhall fall on the holder of the bill. The bill, when refufed, muft, be demanded of the wrawer as foon as conveniently may be: for though, when one draws a bill of exchange, he fubjects himfelf to the payment, if the perfon on whom it is drawn refufes either to accept or pay, yet that is with this limitation, that if the bill be not paid, when due, the perfon to whom it is payable fhall in convenient time give the drawernotice thereof; for otherwife the law will imply it paid: fince it would be prejudicial to commerce, if a bill might rife up to charge the drawer at any diftance of time; when in the mean time all reckonings and accounts may be adjufted between the drawer and the drawee ^y.

IF the bill be an indorfed bill, and the indorfee cannot get the drawee to difcharge it, he may call upon either the drawer or the indorfor, or if the bill has been negotiated through many

.{FS}
^x Lord Raym. 993.
^y Salk. 127.
.{FE}
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hands, upon any of the indorfors; for each indorfor is a warrantor for the payment of the bill, which is frequently taken in payment as much (or more) upon the credit of the indorfor, as of the drawer. And if fuch indorfor, fo called upon, has the names of one or more indorfors prior to his own, to each of whom he is properly an indorfee, he is alfo at liberty to call upon any of them to make him fatisfaction; and fo upwards. But the firft indorfor has nobody to refort to, but the drawer only.

WHAT has been faid of bills of exchange is applicable alfo to promiffory notes, that are indorfed over, and negotiated form one hand to another; only that, in this cafe, as there is no drawee, there can be no proteft for non-acceptance; or rather, the law confiders a promiffory note in the light of a bill drawn by a man upon himfelf, and accepted at the time of drawing. And, in cafe of non-payment by the drawer, the feveral indorfees of a promiffory note have the fame remedy, as upon bills of exchange, againft the prior indorfors.