that the risk of loss for fraudulent indorsements
by employees who are
(96) Allonge is defined as "[a] slip of paper sometimes attached to a negotiable instrument for the purpose of receiving further indorsements
when the original paper is filled with indorsements
." Allonge, BLACK'S LAW DICTIONARY (10th ed.
When the assignee is specifically identified, the indorsement
is called a special indorsement
, and the note becomes payable to the indorsee.
She placed her indorsement
on fabrics, dresses and millinery without his knowledge, and withheld the profits.
While a formal description of negotiability is somewhat involved, for the present purposes the two most essential aspects of negotiability are the ideas of "indorsement
" and of a "holder in due course" (see Winn 1998 for a more complete discussion).
(20.) Under the Uniform Commercial Code, a bank that accepts a check for deposit warrants to the drawee bank that all indorsements
on the check are genuine, and the bank is liable to the drawee bank for the amount of the check plus expenses and lost interest if an indorsement
on the check was forged.
He was also faulted for deliberately failing to reply to complainant's letters requesting for follow-up and to act on several indorsements
and directives to act on the case, the Ombudsman said.
Because of reification, the seller only has something to transfer if the seller can deliver the physical note, and the chain of title is built into the note itself through indorsements
. (260) If there is no delivery, there is no transfer, so it is easy to verify if rights have been transferred.
Moreover, missing or irregular indorsements
or lost instruments compounded the problem by leaving gaps even in this minimal documentation.
The performance of this promise cannot be enforced, for the reason that the promise relates to indorsements
which he is under no obligation to place, and the performance of it is left entirely to his own judgment.
Forged payee indorsements
are subject to different rules.
The abuse and accusations of party treason which have been heaped upon some judges in the recent past because of decisions thought to be contrary to the interests of an indorsing party ought to be evidence enough of the impropriety of party indorsements
and of their purpose to induce partisan political rather than impartial judicial decisions.