158, 75 Am. St. Rep. 160, 56 N. E. 297. Thus, a clause in a note reciting that, in case of default in the payment of interest, the principal shall become due at the option of the holder, does not destroy the negotiable character of the paper: Clark v. Skeen, 61 Kan. 526, 78 Am. St. Rep. 37, 60 Pac. 327, 49 L. R. A. 190; Wilson v. Campbell, 110 Mich. 580, 68 N. W. 278, 35 L. R. A. 544; Phelps v. Sargent, 69 Minn. 118, 71 N. W. 927; Roberts v. Snow, 27 Neb. 425, 43 N. W. 241; Stark v. Olsen, 44 Neb. 646, 63 N. W. 37; Merrill v. Hurley, 6 S. D. 592, 55 Am. St. Rep. 859, 62 N. W. 958; Wright v. Morgan (Tex. Civ. App.), 37 S. W. 627; Thorpe v. Mindeman, 123 Wis. 149, 107 Am. St. Rep. 1003, 101 N. W. 417, 68 L. R. A. 146.

e. Provision for Extension of Time.-A note does not lose its negotiability from the fact that it contains an agreement for an extension of time, if the extension is certain and definite. Hence, an agreement in a note that it is to be extended six months from maturity, if so desired by the makers and indorsers, does not destroy its negotiability: Anniston Loan & Trust Co. v. Stickney, 108 Ala. 146, 19 South. 63, 31 L. R. A. 234. And even a note in the following language has been held negotiable: "Brandon, March 14th, 1868. For value received, I promise to pay D., or bearer, $75 one year from date, with interest annually, and if there is not enough realized, by good management, in one year, to have more time to pay in the manufacture of the plaster bed on Stearn's land": Capron v. Capron, 44 Vt. 410.

But a provision in a note to extend the time of payment indefinitely is fatal to negotiability: Mitchell v. St. Mary, 148 Ind. 111, 47 N. E. 224; Oyler v. McMurray, 7 Ind. App. 645, 34 N. E. 1004; Matchett v. Anderson Foundry & Machine Works, 29 Ind. App. 207, 94 Am. St. Rep. 272, 64 N. E. 229; Second Nat. Bank v. Wheeler, 75 Mich. 546, 42 N. W. 963; Coffin v. Spencer, 39 Fed. 262. Thus, a provision in a note that the "payee or his assigns may extend the time of payment thereof from time to time indefinitely as he or they may see fit," destroys the negotiability of the instrument: Woodbury v. Roberts, 59 Iowa, 348, 44 Am. Rep. 685, 13 N. W. 312; Smith v. Van Blareom, 45 Mich. 371, 8 N. W. 90. And a promissory note having on its face a written memorandum: "This note is given for advancements, and it is the understanding it will be renewed at maturity," is thereby deprived of the essential qualities of commercial paper: Citizens' Nat. Bank v. Piollet, 126 Pa. 184, 12 Am. St. Rep. 860, 17 Atl. 603, 4 L. R. A. 190.

A clause in a note that "without notice the payee or holder may extend the time of payment of the principal," has been held to impair negotiability: Rosenthal v. Rambo, 165 Ind. 584, 76 N. E. 404, 3 L. R. A., N. S., 678; so has a clause waiving "all defenses on the ground of any extension of time in its payment that may be given by its holders" to the makers: Merchants' & Mechanics' Sav. Bank v. Fraze, 9 Ind. App. 161, 53 Am. St. Rep. 341, 36 N. E. 378; Evans v. Odem, 30 Ind. App. 207, 65 N. E. 755. And the negotiability of a

note is destroyed by a stipulation therein that the sureties, indorsers and makers waive notice of the granting of any extension of time, and waive the right of defense on the ground that extensions have been made without notice: Union Stockyards Nat. Bank v. Bolan, 14 Idaho, 87, ante, p. 146, 93 Pac. 508; City Nat. Bank v. Gunter Bros., 67 Kan. 227, 72 Pac. 842. However, the mere stipulation, in a promissory note that the makers, indorsers and sureties consent that the time of payment may be extended without notice does not impair negotiability: Farmer, Thompson & Helsell v. Bank of Graettinger, 130 Iowa, 469, 107 N. W. 170; City Nat. Bank v. GoodloMcClelland Commission Co., 93 Mo. App. 123; First Nat. Bank v. Buttery (N. D.), 116 N. W. 341; National Bank of Commerce v. Kenney, 98 Tex. 293, 83 S. W. 368.

f. Provision for Payment on Contingency.-If the payment of an instrument depends upon a contingency or an event which may never happen, it is not negotiable: Chicago Trust etc. Bank v. Chicago Title etc. Co., 190 Ill. 404, 83 Am. St. Rep. 138, 60 N. E. 586; Tradesmen's Nat. Bank v. Green, 57 Md. 602; Downer v. Tucker, 31 Vt. 204. Hence, a note payable when a specified person shall be elected to a certain office is not negotiable for there is no certainty of his election: Cooper v. Brewster, 1 Minn. 94; Specht v. Beindorf, 56 Neb. 553, 76 N. W. 1059, 43 L. R. A. 429. Likewise, a note payable to a person "when he is twenty-one years old" is not negotiable, for he may never attain that age: Kelley v. Hemmingway, 13 Ill. 604, 56 Am. Dec. 474. An agreement to pay on or before one year after the date of the completion of certain premises is not negotiable: Chicago Trust etc. Bank v. Chicago Title etc. Co., 190 Ill. 404, 83 Am. St. Rep. 138, 60 N. E. 586. Neither is a note payable upon the confirmation of a grant by Congress: Joseph v. Catron (N. M.), 81 Pac. 439; nor a contract to pay upon the determination of a certain suit in favor of the promisor: Shelton v. Bruce, 17 Tenn. 24; nor an obligation to pay a sum of money when a specified estate is "settled up": Husband v. Epling, 81 Ill. 172, 25 Am. Rep. 273. An order reciting, "At sight, after the arrival and discharge of coal of brig G., pay to the order of myself $1,500, value received," is not negotiable: Grant v. Wood, 78 Mass. (12 Gray) 220. An order payable out of the proceeds of specified goods whenever they are sold is not negotiable: De Forest v. Frary, 6 Cow. 151. And a note given for a patent right, payable upon the realization of a certain amount from sales of the article, is not negotiable: Martin v. Shumatte, 62 Tex. 188. A memorandum of settlement among the partners for the completion of a canal section, ascertaining the amount due to one of them at that date, with a promise to pay such amount on the final estimate of the section, is not negotiable: Weidler v. Kauffman, 14 Ohio, 455. And notes due in six months from date, with a clause that in case of the sale or removal of the goods for which the note was given it shall become due at once, is held non-negotiable in First Nat. Bank v. Carson, 60 Mich. 432, 27 N. W. 589.

An instrument otherwise negotiable does not lose its negotiability because payable on a certain event which is certain to happen: Smilie v. Stevens, 39 Vt. 315. Thus, an instrument payable on the death of the promisor is negotiable: Bristol v. Warner, 19 Conn. 7; Martin v. Stone, 67 N. H. 367, 29 Atl. 845. And a note suggesting the possible contingency upon which it must be paid at a date earlier than the one fixed is negotiable: Joergenson v. Joergenson, 28 Wash. 477, 92 Am. St. Rep. 888, 68 Pac. 913. Hence, a note payable on a certain day, or when a certain building is completed, is negotiable: Stevens v. Blunt, 7 Mass. 240; Goodloe v. Taylor, 10 N. C. 458. And a clause in a note payable on a certain date, "or before if made out of the sale" of a specified article, does not affect the negotiability of the note: Walker v. Woolen, 54 Ind. 164, 23 Am. Rep. 639; Noll v. Smith, 64 Ind. 511, 31 Am. Rep. 131; Woolen v. Ulrich, 64 Ind. 120; Charlton v. Reed, 61 Iowa, 166, 47 Am. Rep. 808, 16 N. W. 64; Ernst v. Steckman, 74 Pa. 13, 15 Am. Rep. 542. But it seems that a further provision that the note is not to be paid if the sales do not equal its amount, impairs the negotiability of the paper: Cochran v. Nebeker, 48 Ind. 459. The word "profits" in a note reading "one year after date, for value received, I, the subscriber, promise to pay R., or bearer, $40, profits, with interest," does not affect the negotiability of the note: Matthews v. Crosby, 56 N. H. 21. A note whereby the maker promises to pay a certain sum on a specified day is negotiable, although it provides that it shall become due immediately upon delivery of certain property by the payee: Dobbins v. Oberman, 17 Neb. 163, 22 N. W. 356.

а.

IV. Conditions Affecting Amount Payable.

Provisions Making the Amount Uncertain.-One of the first essentials of a negotiable instrument is that it shall call for the payment of an amount certain at maturity: Dorsey v. Wolff, 142 Ill. 589, 34 Am. St. Rep. 99, 32 N. E. 495, 18 L. R. A. 428; Roblee v. Union Stockyards Nat. Bank, 69 Neb. 180, 95 N. W. 61; National Bank of Commerce v. Feeney, 12 S. D. 156, 76 Am. St. Rep. 594, 80. N. W. 186, 46 L. R. A. 732. The incorporation of a collateral agreement which requires payment of uncertain sums at uncertain times before maturity, and thus renders it impossible to say how much, if anything, will be due at maturity, is fatal to negotiability: Roblee v. Union Stockyards Nat. Bank, 69 Neb. 180, 95 N. W. 61. A note for rent and "subject to any offset that may arise for repairs" is wanting in negotiability: Jones v. Laturnus (Tex. Civ. App.), 40 S. W. 1010. But the negotiability of a note is not impaired by a provision authorizing the payee bank to appropriate on the note at any time any money which the maker may have in the bank: Louisville Banking Co. v. Gray, 123 Ala. 251, 82 Am. St. Rep. 120, 26 South. 205. The certainty required in negotiable instruments is commercial rather than mathematical certainty: State Nat. Bank v. Cudahy Packing Co., 126 Fed. 543; Cudahy Packing Co. v. State

Nat. Bank, 134 Fed. 538, 67 C. C. A. 662; and therefore many courts hold, as will hereafter appear, that the insertion in an instrument of provisions for the payment of exchange, attorneys' fees, and the like, does not deprive the paper of its negotiable character.

b. Provisions for Discount.-A provision in a promissory note for discount in an indefinite amount impairs the negotiability of the instrument; it is otherwise, however, if the provision for discount is certain and definite. Thus a note payable on October 1, 1903, with interest, "a discount of six per cent to be allowed if paid on or before October 1, 1903," is negotiable: Loring v. Anderson, 95 Minn. 101, 103 N. W. 722. But in National Bank of Commerce v. Feeney, 12 S. D. 156, 76 Am. St. Rep. 594, 80 N. E. 186, 46 L. R. A. 732, it is held that a promissory note having a statement written upon its face that it is to be discounted at a certain per cent if paid before maturity is non-negotiable, for, at the time of the execution, it is impossible to ascertain what amount will be required to pay it, without considering the discount, depending upon a condition uncertain of fulfillment.

C. Provisions in Regard to Interest.-A provision in a note for an increased rate of interest after maturity in a case of default does not, according to the weight of authority, introduce such uncertainty of amount into the instrument as to impair its negotiability: Towne v. Rice, 122 Mass. 67; Merrill v. Hurley, 6 S. D. 592, 55 Am. St. Rep. 859, 62 N. W. 958; De Hass v. Roberts, 59 Fed. 853. A contrary rule, however, prevails under the statutes in Montana: Cornish v. Woolverton, 32 Mont. 456, 108 Am. St. Rep. 598, 81 Pac. 4. In Nebraska such a provision is regarded in the nature of a penalty, not enforceable, and therefore not impairing negotiability: Kendall v. Selby, 66 Neb. 60, 103 Am. St. Rep. 697, 92 N. W. 178. A note is none the less negotiable because it states that it is without interest if paid at maturity, but that it is to bear a certain rate of interest if not so paid: Hope v. Barker, 112 Mo. 338, 34 Am. St. Rep. 387, 20 S. W. 567; Christian County Bank v. Goode, 44 Mo. App. 129; Hope v. Barker, 43 Mo. App. 632. And a provision in a note, drawing interest at a specified rate, that if not paid when due it shall draw a higher rate from date until paid does not destroy the negotiability of the instrument: Crump v. Berdan, 97 Mich. 293, 37 Am. St. Rep. 345, 56 N. W. 559; Smith v. Crane, 33 Minn. 144, 53 Am. Rep. 20, 22 N. W. 633; although a different view has been taken of this question under statutes declaring that a negotiable instrument shall contain no condition not certain of fulfillment: Randolph v. Hudson, 12 Okl. 516, 74 Pac. 946; Hegeler v. Comstock, 1 S. D. 138, 45 N. W. 331, 8 L. R. A. 393.

A note for an amount certain, payable to a person named, or bearer, "with interest the same as savings banks pay," is uncertain as to the amount called for, and therefore not negotiable: Whitwell v. Winslow, 134 Mass. 343. And a note payable on or before two years with interest at ten per cent is non-negotiable, if it contains a clause

that if paid within one year it shall not draw interest: Lamb v. Story, 45 Mich. 488, 8 N. W. 87. The acceptance of a bill of exchange, with interest after maturity, is negotiable, since the provision as to interest becomes operative only after maturity: Farmers' Nat. Bank v. Sutton Mfg. Co., 52 Fed. 191, 3 C. C. A. 1, 17 L. R. A. 595. And the negotiability of a certificate of deposit is not impaired by a provision that the amount thereof shall bear interest if left six months, but no interest after six months: Kirkwood v. First Nat. Bank, 40 Neb. 484, 42 Am. St. Rep. 683, 58 N. W. 1016, 24 L. R. A. 444. A note is not rendered non-negotiable by a stipulation for the payment of interest on interest to maturity: Gilmore v. Hirst, 56 Kan. 626, 44 Pac. 603; and a provision that if interest is not paid semi-annually it shall become as principal and bear the same rate of interest does not impair the negotiability of the instrument: Brown v. Vossen, 112 Mo. App. 676, 87 S. W. 577. In Goodin v. Buhler, 57 Mo. App. 63, a note is declared negotiable though usurious on its face. An instrument providing for the payment of a sum certain at a designated date, with interest at six per cent per annum, and that unpaid interest shall bear interest at twelve per cent per annum, and if suit is commenced that customary attorneys' fees shall be added to the judgment and taxed as costs, is a promissory note: Cherry v. Sprague, 187 Mass. 113, 105 Am. St. Rep. 381, 72 N. E. 456, 67 L. R. A. 33.

d. Provisions in Regard to Taxes and Insurance.-While there are authorities which seem to lend themselves to a contrary interpretation (Gilbert v. Nelson, 5 Kan. App. 528, 48 Pac. 207; Cornish v. Woolverton, 32 Mont. 456, 108 Am. St. Rep. 598, 81 Pac. 4; Donaldson v. Grant, 15 Utah, 231, 49 Pac. 779), the better rule is that a provision in a deed of trust or mortgage that if the mortgagor fails to pay the taxes and insurance on the property the mortgagee may do so, and that the amount so paid shall become an additional indebtedness secured by the mortgage, does not impair the negotiability of the note secured by the mortgage. Such provision in the mortgage is not imported into the note; but the mortgage and the note form two separate contracts, both being a part of the same transaction, but each relating to its own subject matter, and not interfering with the other: Frost v. Fisher, 13 Colo. App. 322, 58 Pac. 872; Kendall v. Selby, 66 Neb. 60, 103 Am. St. Rep. 697, 92 N. W. 178; Thorp v. Mindeman, 123 Wis. 149, 107 Am. St. Rep. 1003, 101 N. W. 417, 68 L. R. A. 146. There are a number of decisions, however, to the effect that a provision in a mortgage for the payment of taxes by the mortgagor destroys the negotiability of the accompanying note, because it renders the amount uncertain. It would seem, however, that the agreement to pay taxes in these cascs was to pay those which might be levied against the mortgagee or on his interest in the estate, which agreement had no connection with the preservation of the security: Wistrand v. Parker, 7 Kan. App. 562, 52 Pac. 59; Walker v. Thompson, 108 Mich. 686, 66 N. W. 584;