indorsement – the signing of one’s name on the back of a negotiable instrument, to transfer title to the paper to another person, usually to guarantee payment

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n. (16C)

1. The placing of a signature, sometimes with an additional notation, on the back of a negotiable instrument to transfer or guarantee the instrument or to acknowledge payment.

2. The signature or notation itself. — Also spelled endorsement. indorse, vb. [1]

1. Literally, as derived from the Latin “indorsa,” a writing on the back; employed in common as well as legal usage to designate the transaction whereby the holder of a bill or note transfers his right to such instrument to another person and incurs the liabilities incident to the transfer under the law. 11 Am 12d B & N § 349.

The writing of one’s own name on the back of a negotiable instrument, whereby one not only transfers one’s full legal title to the paper but likewise enters into a contract, implied or express, dependent upon whether or not the signing of the name is accompanied by other words, and the particular words used, such as an implied guaranty that the instrument will be paid. Glaser v Connell, 47 Wash 2d 622, 289 P2d 364.

An additional contract on the instrument; a new, independent, and substantive contract. 11 Am J2d B & N § 349. (For liability of indorser, see 11 Am J2d B & N §§ 598 et seq.)

Signing one’s name on the face of a bill or note with words indicating the character of the signature as an indorsement or the character of the signer as an indorser. Peoples Nat. Bank v Dicks, 258 Mich 441, 242 NW 825.

A signature on a security in registered form or on a separate document assigning or transferring the security or granting a power to assign or transfer it, or the mere signature on the back of a security of a person having the right or authority to assign or transfer the instrument or empower another person to assign or transfer it. UCC § 8-308(1).

Broadly, a writing on the back of an instrument for any purpose, not necessarily the purpose of transfer or assumption of liability. 11 Am 12d B & N § 349.

Technically confined to the theory of negotiability, but commonly used in application to the writing of a name on the back of a nonnegotiable instrument. Bank of America v Butterfield, 77 SD 170, 88 NW2d 909.

A signature upon the back of a will. 57 Am J1st Wills § 263.

Most broadly, a writing upon either the back or margin of an instrument, for example, a writing indicating part payment. 34 Am J1st Lim Ac § 347.

The marking of an envelope which contains a deposition to indicate such content and the title of the cause. 23 Am J2d Dep § 82. [2]

1. The writing of one’s name on the back of a negotiable instrument, by which a person transfers title to the paper to another person.

2. Loosely speaking, signing one’s name on the back of any document.

3. Approval; backing; support.  Used in this sense, the word is generally spelled endorsement. [3]

     Excerpt from James J. White & Robert S. Summers’s Uniform Commercial Code (4th ed. .1995):

     “The clever indorser can subscribe his or her name under a variety of magic phrases.  The Code specifies the legal effect of some of these phrases.  Qualified indorsements (‘without recourse’) limit the liability of the indorser if the instrument is dishonored.  Restrictive indorsements such as ‘for deposit only,’ ‘pay any bank,’ and the like set the terms for further negotiation of the instrument.  Their main purpose is to prevent thieves and embezzlers from cashing checks. [4]

Related Terms:

indorsee – a person to whom a negotiable instrument is transferred by indorsement. — Also spelled endorsee.

indorser – a person who transfers a negotiable instrument by indorsement.

Types of Indorsements:

accommodation indorsement: (1888) An indorsement to an instrument by a third party who acts as surety for another party who remains primarily liable.  See ACCOMMODATION PAPER.

blank indorsement: (18c) An indorsement that names no specific payee, thus making the instrument payable to the bearer and negotiable by delivery only. UCC § 3-205(b). — aka indorsement in blank; general indorsement.

conditional indorsement: (1815) An indorsement that restricts the instrument in some way, as by limiting how the instrument can be paid or transferred; an indorsement giving possession of the instrument to the indorsee, but retaining title until the occurrence of some condition named in the indorsement.  *  Wordings that indicate this type of indorsement are “Pay to Brad Jones when he becomes 18 years of age” and “Pay to Brigitte Turner, or order, unless before payment I give you notice to the contrary.” — aka restricted indorsement; restrictive indorsement.  Cf. special indorsement.

     Excerpt from Melville M. Bigelow’s The Law of Bills, Notes, and Checks (William Minor Lile ed., 3d ed. 1928):

     “Conditional indorsement. -This somewhat rare form of indorsement is one expressing a lawful condition, other than those conditions implied by the Law Merchant such as presentment and notice of dishonor.  For example, ‘pay A on his graduation’, ‘pay A on arrival at twenty-one’, ‘pay A on completion of house contract.’ Unlike conditions expressed on the face of the instrument, a conditional indorsement does not destroy the negotiability of the instrument.  Nor in making payment need the maker, drawee or acceptor inquire whether the condition has been fulfilled or not. [5]

irregular indorsement: (1741) An indorsement by a person who signs outside the chain of title and who therefore is neither a holder nor a transferer of the instrument.  *  An irregular indorser is generally treated as an accommodation party. — aka anomalous indorsement; full indorsement.  See ACCOMMODATION PARTY. ‘

qualified indorsement: (1806) An indorsement that passes title to the instrument but limits the indorser’s liability to later holders if the instrument is later dishonored.  *  Typically, a qualified indorsement is made by writing “without recourse” or “sans recourse” over the signature. UCC § 3-415(b). — aka indorsement without recourse. See WITHOUT RECOURSE.

     Excerpt from Melville M. Bigelow’s The Law of Bills, Notes, and Checks (William Minor Lile ed., 3d ed. 1928):

     “A qualified indorsement is one that ‘constitutes the indorser a mere assignor of the title to the instrument.  it may be made by adding to the indorser’s signature the words “without recourse”, or any words of similar import. Such an indorsement does not impair the negotiable character of the instrument.’  The purpose of such an indorsement is to pass title to the instrument without assuming a general indorser’s liability.  Though by no means confined to that class, it is more commonly used by persons holding paper in a representative capacity, in the transfer of the paper to the beneficial owner or owners — as in the case of agents, attorneys, executors, administrators, guardians, trustees and other fiduciaries. [6]

restrictive indorsement: (18c) An indorsement that includes a condition (e.g., “pay Josefina Cardoza only if she has worked 8 full hours on April 13”) or any other language restricting further negotiation (e.g., “for deposu only ). — aka collection indorsementSee conditional indorsement.

special indorsement: (18c) An indorsement that specifies the person to receive payment or to whom t e goods named by the document must be delivered. UCC § 3-205(a). — aka indorsement in full; full indorsement.  Cf. conditional indorsement.

trust indorsement: (1926) An indorsement stating that the payee becomes a trustee for a third person.(e..g., “pay Erin Ray in trust for Kaitlin Ray”); a restrictive indorsement that limits the instrument to the use of the indorser or another person.

unauthorized indorsement: (1840) An indorsement made without authority, such as a forged indorsement.

unqualified indorsement: (1808) An indorsement that does not limit the indorser’s liability on the paper.  *  It does not, for example, include the p rase “without recourse.”

unrestrictive indorsement: (1844) An indorsement that Includes no condition or language restricting negotiation. — aka unrestricted indorsement.




     See backing; blank indorsement; for account of; for clearing house purposes only; for collection; for deposit; full indorsement; general indorsement; guaranty of previous indorsements; irregular indorsement; previous indorsements guaranteed; proper indorsement; qualified indorsement; regular indorsement; restrictive indorsement; special indorsement; transfer by indorsement; usual course of business; waiver of presentment; waiver of protest; without recourse. [2]

     See endorsement.
     See further accommodation paper; blank indorsement; conditional indorsement; full indorsement; general indorsement; full indorsement; general indorsement; restrictive indorsement; special indorsement. [3]


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[1]: Black’s Law Dictionary Deluxe Tenth Edition by Henry Campbell Black & Editor in Chief Bryan A. Garner. ISBN: 978-0-314-62130-6

[2]: Ballantine’s Law Dictionary with Pronunciations
Third Edition
 by James A. Ballantine (James Arthur 1871-1949).  Edited by William S. Anderson.  © 1969 by THE LAWYER’S CO-OPERATIVE PUBLISHING COMPANY.  Library of Congress Catalog Card No. 68-30931

[3]: Ballantine’s Law Dictionary Legal Assistant Edition
by Jack Ballantine 
(James Arthur 1871-1949).  Doctored by Jack G. Handler, J.D. © 1994 Delmar by Thomson Learning.  ISBN 0-8273-4874-6.

[4]: 2 James J. White & Robert S. Summers, Uniform Commercial Code 5 16-7, at 92-93 (4th ed. .1995).

[5]: Melville M. Bigelow, The Law of Bills, Notes, and Checks 193-94 (William Minor Lile ed., 3d ed. 1928).

[6]: Melville M. Bigelow, The Law of Bills, Notes, and Checks 192-93 (William Minor Lile ed., 3d ed. 1928) (citations omitted).


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