ned by
fraud or by intimidation, the payee, knowing these facts, has no right to
collect upon the note, and he could not by law compel payment. But with a
third party it is different. He sees only the note, and may not--
presumably does not--know anything else about the contract. To compel him
before buying the note to learn all the details of its history, might be
embarrassing to the parties, even where everything is all right, and would
certainly delay, perhaps materially, the transfer. Therefore, to enable
people to keep their business to themselves, and to facilitate transfers
of commercial paper, it has seemed best not to require this investigation.
The law presumes that when a person makes a transferable note, he has done
so deliberately; and if loss ensues, it says that he must bear it rather
than the innocent purchaser of his note.

Conditions of Negotiability.--But this peculiar protection is given, be it
observed, only to an _innocent purchaser_. If in good faith, in the
regular course of business, a person comes into possession of commercial
paper, negotiable in form, not yet mature, and for which he has given a
reasonable consideration, he can collect on it. On the other hand, if he
has found the paper or stolen it, or if he has bought it under
circumstances calculated to raise a suspicion as to right of the seller,
he should not have, and will not by law receive, this privilege. Thus if a
man is offered commercial paper of perfectly responsible parties at
one-third its value, it would be reasonable to suppose that the person
offering it had found or stolen it, and the buyer would obtain only the
rights of the person from whom he bought. Or if a note past due is offered
for sale, the presumption is that it is paid or that it is for some reason
uncollectable, and the purchaser would buy at his peril. In other words,
_if there is anything on the face of the paper or in the circumstances of
the case to warn the purchaser, he buys at his own risk_, and secures only
such rights as the vendor has.

Transfer.--Negotiable paper with the words "or bearer" is transferable by
delivery alone. If made payable to some person "or order," it is
transferable only by his _indorsement_. An "indorsement in full" consists
of the signature of the payee and his order that the money be paid to a
specified person. An "indorsement in blank" consists simply of the
signature of the payee. The effect of the latter mode of indorsing is t