Fig. 5. Promissory Note with Blank Indorsement.
If X. X. Crumby desires to transfer the note to anyone, he signs his name on the back thereof, as indicated in the illustration. This is called a blank indorsement, and makes the note payable to bearer. The note now passes as currency without further indorsement. Subsequent holders may indorse the note if they so desire, or are so required. If the back of a negotiable instrument becomes filled with indorsements, a paper may be attached to carry further indorsements. Such a paper is called an allonge.
137. Indorsement in Full. A holder of a negotiable instrument, not desiring to make it payable to bearer, may indorse it by making it payable to some particular person or to the order of some particular person, followed by his signature. This does not destroy the negotiability of the instrument, but prevents anyone but the person to whom it is indorsed, or such person's indorsees, from securing payment of the instrument. This is not true if the instrument is payable to bearer, or if it has been indorsed in blank. Such instruments are payable to bearer, and circulate as money without requiring further indorsement. If subsequently indorsed in full, only those subsequent holders can hold the indorser in full, who can trace their title through him.
Fig. 6. One Form of
Indorsement in Full.
Fig. 7. Another Form of
Indorsement in Full.