Page:Federal Reporter, 1st Series, Volume 5.djvu/414

 404 iedbbaij bbpobteb. �onea oi "order" or "bearer," which are the onôs in universal lise. Notes trausferred and properly indbrsed use one or the other of those expressive words. If neither is used in an indorsement, but the same is made in blank, the holder for value bas the right to fill up an indorsement, so as to make it conform to the custom prevailing at the time, ànd as sanc- tioned by the law merchant. Such an indorsement carries with it a new liability on the part of the indorser. He virtu- ally guaranties the payment of the note when due, and agrees to pay it himself, in case the makers fails to do so, if he reeeives timely notice of the dishonor. �In such case the holder can at once proceed by action against the maker and indorsera to enforce payment of the note. In this state he can proceed against one or ail — both maker and indorsers. He need not exhaust an expensive remedy against the maker before he can call on the indorser to pay. He can elect to proceed against either or bôth at his option. This is orie of the most valuable remedies and wise provisions of the commercial law, which commends itselt to the good sense of every commercial nation, and bas been sanctioned and uphôld for ages. It ia not so with the note in suit. The note is " transferred, and ita collection guaran- tied." This is not, in any sense, a "commercial indorsement." The relations of the parties are entirely different from what they would bave been had the note been indorSed in the ordi- nary and usual way. Here the bank could not sue either of the Hazzards until after it had exhausted its legal remedies against the makers without beneficiai resulta. This would be indispensable to a recovery against the guarantors. The guarantora could not be joined as defendants with the makers of the note, the obligations to the holder being entirely dif- ferent; the obligation of the indorser being, in substance, that if the maker oi the note doea not pay at maturity, he will himself do it for the maker. The obligation of the party who guaranties the collection of a note simply binds himself to pay the debt, provided it cannot be made ont of the principal debtor by due process of law. This lattcr relation is the one the Haiizards sustain to the bank as plainfciii in this case. ����