The decision that was rendered in the case of the Continental Bank Trust Co. v. Times Publishing Co., 142 La. 209, 76 So. 612, L.R.A. 1918B, 632, is not important as a precedent, because there was no doctrine of law announced, except what was already written in the Negotiable Instrument Law (Act 64 of 1904). The only question in the case was, and the only question in every case like this is, whether the intention of the parties to the transaction as expressed in the promissory note was to make the promise to pay "an unconditional promise." The first section of the Negotiable Instrument Law declares:
*Page 264"An instrument to be negotiable must * * * contain an unconditional promise or order to pay," etc.
The third section of the act declares:
"An unqualified order or promise to pay is unconditional, within the meaning of this act, though coupled with * * * a statement of the transaction which gives rise to the instrument."
The meaning is that, if the promise to pay in a promissory note is otherwise "an unqualified promise to pay," a statement in the note of the transaction for which it was given shall not per se render the promise subject to the conditions of the transaction.
There is no reason of public policy why a person should not or may not issue a negotiable promissory note — give an unconditional obligation — to pay an obligation which, as to the original payee, is only a conditional or contingent obligation. When that is done the maker of the note merely trusts the payee, much the same as when payment is made in cash in advance of the maturity of the obligation.
Of course, a statement in a promissory note of the transaction in which it was issued may be so worded as to make the promise itself a conditional one. In such case the reason why the note is not a negotiable instrument is that it lacks the essential of being "an unconditional promise to pay." But the mere statement in a promissory note that it is a rent note, and that the consideration is therefore to be received according to the terms and conditions of the contract of lease referred to, does not of itself make the promise a conditional promise or affect the negotiability of the note. I do not understand the doctrine of the Continental Bank Trust Company's Case to be contrary to the proposition which I have stated. If it were so, I would suggest overruling the case.
There is one feature of the rent notes here in contest which, in the absence of a direct expression to the contrary, makes it plain to me that the notes were intended to be negotiable instruments. I refer to the fact that the notes were made payable to the order of *Page 265 their makers and were indorsed by them. The only purpose of making a promissory note in that form, instead of making it payable to a named payee or order, is to make the note transferable by mere delivery. I suppose that our attention was not directed to that circumstance in the Continental Bank Trust Company's Case. If we were wrong in our ruling in the case, it was only in our conclusion of fact that the intention of the parties, as expressed in the notes, was to make the promise a qualified or conditional or contingent promise.