COMMERCIAL LAW

American Institute of Banking

Section American Bankers Association

110 East 42 Street     New York City

Copyright, 1921
by
American Institute of Banking

PREFACE

The Institute standard course of study in "Commercial Law" is not intended to make lawyers, but simply to impart to bankers sufficient knowledge of law to enable them to act in accordance with established legal principles, and refer doubtful questions to a lawyer. It is not usurping the functions of a lawyer for a banker to know his legal rights and responsibilities. The banker who does not appreciate the importance of this knowledge, eventually learns from experience, sad or otherwise, that he has neglected an important part of the training necessary to carry on his business with safety and confidence. This text-book is based on the splendid work, originally prepared for the Institute, by Samuel Williston, Weld Professor of Law in Harvard Law School. To this original matter, however, much new material has been added, cases have been cited, and new chapters on Master and Servant, Estates and Trusts, Bills and Notes, and Torts and Crimes added. The work of preparing "Commercial Law" has been done jointly by Richard D. Currier, President of the New Jersey Law School, and Richard W. Hill, member of the New York Bar and Secretary of the American Institute of Banking. The main purpose of this book is to teach bankers to recognize the danger signals in law, when they appear, and thus be able to distinguish between law and law suits.

INSTITUTE PLATFORM

Resolution adopted at the New Orleans Convention of the American Institute of Banking, October 9, 1919:

"Ours is an educational association organized for the benefit of the banking fraternity of the country and within our membership may be found on an equal basis both employees and employers; and in full appreciation of the opportunities which our country and its established institutions afford, and especially in appreciation of the fact that the profession of banking affords to its diligent and loyal members especial opportunities for promotion to official and managerial positions, and that as a result of the establishment and maintenance of the merit system in most banks a large number of Institute members have through individual application achieved marked professional success, we at all times and under all circumstances stand for the merit system and for the paying of salaries according to the value of the service rendered.

"We believe in the equitable cooperation of employees and employers and are opposed to all attempts to limit individual initiative and curtail production, and, insofar as our profession is concerned, are unalterably opposed to any plan purporting to promote the material welfare of our members, individually or collectively, on any other basis than that of efficiency, loyalty and unadulterated Americanism."

CONTENTS

WHO IS A BANKER?

A successful banker is composed of about one-fifth accountant, two-fifths lawyer, three-fifths political economist, and four-fifths gentleman and scholar—total ten-fifths—double size. Any smaller person may be a pawnbroker or a promoter, but not a banker.—George E. Allen.

Commercial Law

INTRODUCTION

DEFINITION OF LAW.—The term "law" is used in many ways. We speak of moral