IMAGE EVALUATION TEST TARGET (MT-3) 1.0 I.I I |28 mm ^ us, u L25 III 1.4 2.5 2.2 1 2.0 Ii4 Hiotographic Sdences Corporation '^.V^ 23 WIST MAIN STMIT WIUTII,N.Y. USSO (716) 172-4303 '^ 4' ts CIHM/ICMH Microfiche Series. CIHM/ICIVIH Collection de microfiches. Canadian Institute for Historical Micrornproc ictions / Institut Canadian d** microreproductions historiques Technical and Bibliographic Notes/Notes techniques et bibliographiques The Institute has attempted to obtain the best original copy available for filming. Features of this copy which may be bibliographically unique, which may alter any of the images in the reproduction, or which may significantly change the usual method of filming, are checked below. D D n n □ D D D n Coloured covers/ Couverture de couleur Covers damaged/ Couverture endommagde Covers restored and/or lamindted/ Couverture restaurde et/ou peliiculde Cover title missing/ Le titre de couverture manque Coloured maps/ Cartes gdographiques en couleur Coloured ink (i.e. other than blue or black)/ Encre de couleur (i.e. autre que bleue ou noire) Coloured plates and/or Illustrations/ Planches et/ou illustrations en couleur Bound with other material/ Reli6 avec d'autres documents Tight binding may cause shadows or distortion along interior margin/ La re liure serr6e peut causer de I'ombre ou de la distortion le long de la marge int6rieure Blank leaves added during restoration may appear within the text. Whenever possible, these have been omitted from filming/ II se peut que certaines pages blanches ajoutdes lors d'une restauration apparaissent dans le texte, mais, lorsque cela 6tait possible, ces pages n'ont pas 6t6 filmdes. Additional comments:/ Commentaires suppt6mentaires; L'Irstitut a microfilm^ le meilleur exemplaire qu'il lui a 6t6 possible de se procurer. Les details de cet exemplaire qui sont peut-dtre uniques du point de vue bibliographique, qui peuvent modifier une image reproduite, ou qui peuvent exiger une modification dans la m^thode normale de filmage sont indiquds ci-dessous. D D D D D D D D n Coloured pages/ Pages de couleur Pages damaged/ Pages endommagdes Pages restored and/or laminated/ Pages restaur^es et/ou pelliculdes Pages discoloured, stained or foxed/ Pages ddcolordes, tachetdes ou piqudes Pages detached/ Pages ddtachdes Showthrough/ Transparence Quality of print varies/ Quality indgale de {'impression Includes supplementary material/ Comprend du materiel suppl^mentaire Only edition available/ Seule Edition disponible Pages wholly or partially obscured by errata slips, tissues, etc., have been refilmed to ensure the best possible image/ Les pages totalement ou partiellement obscurcies par un feuillet d'errata, une pelure, etc., ont 6t4 filmdes d nouveau de fapon d obtenir la meilleure image possible. This item is filmed at the reduction ratio checked below/ 10X 14X u lav n U0 ■ auu 18X inaii ^ue G i-aea 80U8 22X 26X 30X 7 WX 16X 20X 24X 28X 32X The copy filmed h«ra hat bMn reproducad thanks to the generosity of: University of Toronto 1 « at / L'examplaira filmA f ut reproduit grice A la g4nArositA de: University of Toronto Library The images appearing hore are the best quality possible considering the condition and legibility of the original copy and in keeping with the filming contract specifications. Original copies in printed paper covers are filmed beginning with the front cover and ending on the last page with a printed or illustrated Impree- slon, or the back cover when appropriate. All other original copies are filmed beginning on the first page with a printed or illustrated impres- sion, and ending on the last page with a printed or illustrated Impression. The last recorded frame on each microfiche shall contain the symbol — ^ (meaning "CON- TINUED"), or the symbol ▼ (meaning "END"), whichever applies. Maps, plates, charts, etc., may be filmed at different r«;duction ratios. Those toe large to be entirely included in one exposure are filmed beginning in the upper left hand corner, left to right and top to bottom, as many frames as required. The following diagrams illustrate the method: Les images suivantes ont StS reproduites avec le plus grand soin. compte tenu de la condition at de la nettet* de i'exemplaire film*, et en conformiti avec les conditions du contrat de fllmage. Les exemplaires originaux dont la couverture en papier est ImprimAe sont filmte en commen^ant par le premier plat et en terminant solt par la dernlAre page qui comporte une empreinte d'Impression ou d'illustration, soit par le second plat, salon le cas. Tous les autres exemplaires originaux sont filmte en commenpant par la premiere page qui comporte une empreinte d'Impression ou d'illustration et en terminant par la dernlAre page qui comporte une telle empreinte. Un des symboles sulvants apparaltra sur la dernlAre image de cheque microfiche, selon le cas: le symbole -^ signifie "A SUIVRE", le symbole V signifie "FIN". Les cartes, planches, tableaux, etc.. peuvent dtre filmte A des taux de rMuction diffirents. Lorsque le document est trop grand pour Atre reproduit en un seul clichA, il est film* A partir de Tangle supArieur gauche, de gauche A droite, et de haut en bas, en prenant ie nombre d'images nAcessaire. Les diagrammes suivants illustrent la mAthode. 1 2 3 1 2 3 4 5 6 (/ fT C/9ifi7 ^\}Q complimGnts of tl7( jDublisl7^rs, (]^y ^. G. Bryant (;ompany (bimHed), iporot\to, (;anG\dGi. mmmmmm THE LAW OF BILLS OF EXCHANGE AND PROMISSORY NOTES ^66 a lv^ THE LAW OP BILLS OF EXCHANGE AND PROMISSORY NOTES BEING AN ANNOTATION OF "THE BILLS OF EXCHANGE ACT, 1890' l'.V EDWARD H. SMYTHE, LL.D. One of Her Majesty's Counsel Sfd ctiatii li\!i;ibns oportet esse armatam." Toronto THE J. E. BRYANT COMPANY (LIMITED) 1891 Entered according to Act of the Parliament of Canada in the Office of the Minister of Agricultme by The J. E. Bryant Company (Limitkd). James Murray & Co., Printers and Hinders Toropto. TO Thk HON. SIR JOHN S. I). THOMI'SON, K.C.M.c;., (^).C., P.C. MINISTER 0|- JUSTICK OF THE DOMINION WHOSK SKII.KUI. I.AlinURS IN THK I'Ml'K Al ION OK run LAWS RESI'ECTINC. NK(iOII ABLE INSTRUMENTS HAVE liENKKITED ALIKE CANAKIAN COMMERCE AND JURISI'RltDENCE THIS WORK IS IIY KINK PERMISSION KESI'ECTITM.LY DEDICATED i\ PREFACE. Mv design has been iv present to the practitioner an annotated copy of " The Bills of Exchange Act, 1890"; to collate the different sections which explain and illustrate each other ; and to draw special attention to the alterations in the law introduced by the Art. It will readily be perceiv '1 fiom its small compass that I have not in the course of this work attempted an exhaustive treatise upon the subject of " Bills and Notes. " The valuable works of Byles Daniel, Chitty and others, so fully cover the whole ground that a the present it would seem unnecessary to do so. One of the principal proofs of the utility and excellence of the codification effected by the English Act, is the infrequency of litigation upon its construction since it came into force on the i8th August, 1882. I have collected all the English decisions in the Law Reports upon this subject and find less than a dozen cases reported. I have read all the recent Ontario decisions and many of the older ones, and with the exception of such as are over-ruled or obsolete, they will in general l)e found cited in their appropriate places in the course of the work. Only in a few instances have 1 ventured, and even then with great diffidence, upon suggestions of my own. On a revision of the volume after it has gone to press I am con- scious that I could introduce improvements, and I am not so vam as to anticipate that my work will escape the criticisms of others ; I hope to take advantage of these, as well as of my own researches, in a future edition. In the meantime I crave the indulgence of the public, and especially of the profession to which I have the honour to belong. I cannot conclude without acknowledging my deep obligation to Mr. Colin Eraser, B.A., Barrister, Toronto, for his valuable assistance in reading and correcting my proof. EDW. H. SMYTHE. Kingston, Ont., November, 1890. CONTENTS. Page. Table of Cases Cited ''i|'' List of Abbkeviations xxvii. Introduction ""*''• Sec. of Act. Page. Preliminary : Short title of the Act i i Interpretation of terms 2 5 Form and Interpretation of Instriments : Bill of Exchange defined 3 ^ Inland and foreign bills 4 ^° Effect where different parties to bill are the same person 5 10 Drawee to be named 6 ii Certainty required as to pajee 7 '^ What bills are negotiable S 13 Sum payable 9 13 Bill payable on demand 10 17 Bill payable at a future time n iS Omission of date in bill or acceptance 12 19 Antedating and post-dating 13 20 •Computation of time of payment and days of grace 14 21 •Case of need 15 25 Stipulations by drawer or indorser 16 26 Definition and requisites of acceptance 17 26 Time for acceptance tS 28 'General and qualified acceptances 19 29 Incomplete instruments 20 30 Delivery .. .. 21 32 Cai'acitv and Authority of Parties: Capacity of parties ,22 34 Signature essential to liability 23 36 Forged or unauthorized signature 24 37 Procuration signatures .^5 39 Person signing as agent or in representative capacity 26 40 X. »iLLs OF Exchange Act, 1890. Si;c. OK Act. Page,. Consideration iok Hills: Valuable consideration 27 42 Accommodation party to a bill -^ 44 Holder in due course -9 45 Presumption of value and good faith 30 47 Negotiation of Bills: Negotiation of bills 31 5' Requisites of a valid indorsement 3- 54 Conditional indorsement 33 57 Indorsement in blank and special indorsement. . 34 57 Restrictive indorsement 35 5^ When negotiable bills cease to be so 36 59 Negotiation of bill to party already liable thereon. . 37 (^2 Rights of the holder 3"^ ^'^ General Dities oe the Holder : Presentment for acceptance, when necessary. . . 39 Time for presenting bill payable after sight. . . 40 Rules as to presentment for acceptance 41 Non-acceptance 4-: Dishonour by non-acceptance, and its conse- tpiences 43 Duties as to (jualified acceptances 44 Rules as to presentment for payment 45 Kxcuse for delay in presentment for payment. . . 4^1 Dishonour by non-payment . . 47 Notice of dishonour and effect of non-notice. . . 4S Rules as to notice of dishonour 49 Excuses for non-notice and delay 50 Noting or protest of bill 51 Liability of acceptor as to presentment . . . . 52 Liabilities oE Parties: Funds in hands of drawee 53 Liability of acceptor 54 Liability of drawer 55 Liability of indorser 55 Liability of stranger 5f) Measure of damages against parties to dishonoured bill 57 Transferrer by delivery 58 64 66 67 6.J 70 71 72 7S 80 ■So 82 Sg 91 97 99 99 lOI 102 '"3 104 108 CONTKNTS. Skc. or Act. Discharge of Bills : Payment in due course 59 Acceptor the holder at maturity fio Express waiver 6i Cancellation f'2 Alteration of bill ^3 Satisfaction Extinguishment Suspension Release Acceptance and Payment for Honour : Acceptance for honour 64 Liability of acceptor for honour 65 Presentment to acceptor for honour or case of need. 66 Payment for honour 67 Lost Instruments: Holder's right to duplicate of lost bill 68 Action on lost bill 69 Bill in a Set: Rules as to sets 70 Conflict of Laws : Rules where laws conflict 71 Cheques on a Bank : Cheque defined 72 Present. nent of cheque for payment 73 Revocation of bank's authority to pay 74 General and special crossings defined 75 By whom cheque may be crossed 76 Crossing a material part of cheque 77 Duties of bank as to crossed cheques 78 Protection to bank and drawer where cheque is crossed 79 Effect of " not negotiable " crossing on holder. . . 80 Protection to collecting bank 81 XL Page. 109 III 1 II 112 "3 116 II 117 118 120 122 1 22 124 127 128 129 •31 •38 140 141 • 44 '45 147 147 150 '51 '5' xii. Bills of Exchange Act, 1890. Skc. of Act. Promissory Notes : Promissory note defined Sz Delivery necessary to complete note 83 Joint and several notes 84 Note payable on demand 85 Presentment for payment 86 Liability of maker 87 Application to notes of provisions as to hills of exchange 88 SlPPLEMENTAKV : Good faith Hg Signatures by agents go Seal or signature of corporation qo Computation of time gi When noting equivalent to protest 9^ Protest when notary is not accessible 9 j Dividend warrants may be crossed 94 Repeals 93 Construction of Act with other acts or docu- ments g() Commencement of Act 97 Forms Index Paoe. 152 '54 154 •55 156 '59 '59 161 161 162 163 '63 164 166 167 168 168 171 194 1 TABLE OF CASES CITED. Abrey v. Crux, 153. Agra Bank, in re, 69. Agricultural Ins. Co. v. Federal Bank, 63, no. Alexanders. Burchfield, 98, 140, 157. Ancona v. Marks, 51. Anderson v. Beck, 8g. Andrews 'J. Bank of Toronto, 109. Ansell V. Baker, 117. Armstrong v. Page, 46. Armstrongs. Garafraxa, 163. .'Vrnold v. Mayor of Poole, 162. .\rnold V. The Cheque Bank, 115. Ashpitle V. Bryan, 100, 102. Attwood v. Munnings, 40. Austin V. Gibson, i ig. Austin V. Gordon, 42. B Bailey v. Bidwell, 48 Bailey v. Bodenham, 76. Bailey t'. Griffith, iig, 155. Bailey v. Porter, 158. Baillie i'. Dickson, 87. Baldwin v. Richardson, 87. Bank of Commerce v. Jenkins 116 " of Hamilton v. Harvey, i '4- " of Ireland r. Archer, 28. *' of Montreal v. De Latre, 100 " of Montreal v. Scott, 49, 169. " of Montreal i: Thomas, 28. XIV. Bills of Exchange Act, 1890. ii Bank of Toronto v. Cobonrg, 8, 31, 115. " of Toronto r. Irwin, 42, 44. " of Toronto v. McDongall, 134. " of Van Dieman's Land v. Bank of Victoria, 70. Barton v. Gainer, 43, 52. Baxendale v. Bennett, 34. Bedford v. Deakin, 117. Beecher ;'. Corporation of Amherstburg, 76. Beenian v. Dnck, 100, Bell V. Riddell, 46. Bellamy v. Majoribanks, 144, 147, 150. Belshaw i'. Bush, 117. Beltz 'c'. Molsons' Bank, 63, 115. Bentinck v. Dorrien, 72. Billing V. Devaux, 28. Bishop, expiirtc, 82, 104. Black z'. Strickland, 58, 62, no. Blackley v. Kenny, 42, 118, 119. Blackley v. McCabe, 138, 146. Blanckenhagen <'. Blundell, 12. Bobbett I'. Pinkett, 148. Bowes V. Howe, 79. Boyd V. Nasniith, 141. British Linen Co. 7'. Drunimond, xxxi. Bristow V. Sequeville, 133. Brockville & Ottawa R.W.Co. v. Canada Central R.VV.Co., 36. Brook V. Hook, 38. Brown v. Holland, 41. Buck V. Robson, g. Burchfield v, Moore, 34, 38, 102. Buxton 7>. Jones, 76. Caldwell v. Merchants' Bank, 99, 138, Cambefort v. Chapman, 12, 37, 154. Caniidge v. AUenby, 108. Campbell v. F<^rench, 24, 64. Campbell v. Lane, 25. Canadian Bank of Commerce t'. Green, 1 19. V. Gurley, 32, 42, 44, V. Wilson, 36. V. Woodward, 42, 118. Cannan ?'. Farmer, 36. Carew i*. Duckworth, 139. It it «t <( tl tt t( i( (< Table ok Cases Cited. XV. 1 Carlon v. Ireland, 144, 147. i49- Carruthers i;. Ardagh, 116, iiS. Carters. White, 31. Cassidy v. Mansfield, 84. Central Bank, Morton and Block's Cases re, 153. Central Bank v. Garland, 153. Charles v. Marsden, 45, 60. Cheetham v. Ward, 118. Chesney V. St. John, 152. Ching V. Jeffrey, 60. Clark V. Martin, xxx. Clark v. Piggott, 58. Clark V. Union Fire Ins. Co., 31. Clarke v. Bradlaugh, 95. Clarkson 7'. Ontario Bank, 69. Claxton V. . ^ift, 117. Clench v. Consolidated Bank of Canada, 139. Clipperton v. Spettigue, 56. Cloves I'. Chapman, 133. Cochrane!^. Boucher, 153- Cockbnrn v. Johnston, 56. Cohen v. Hale, 139, 142. CoUis V. Enimett, 31. Commercial Bank v. Cotton, 49. Commercial Bank i'. Harris, 49, 169. Conn ;'. Merchants' Bank, 79, 89, 108, Cook V. Fowler, 17, 105. Cooper V. Blacklock, 40. Cooper 7'. Parker, 1 16. Cordery t-. Colville, 90. Cosgrave v. Boyle, 85, SS. Cote, exparte, iS- Court V. Scott, xxxi, 132. Cowan i^. Doolittle, 60. Cowie V. Stirling, 12. Crook t'. Jadis, 161. Crosby v. Roub, 55. Cross V. Currie, 32, 42. 44. Crossley v. Ham, 62. Crouch V. The Credit Foncier of England, 162. Crousei'. Park, 105. Crowe V. Clay, 128. Crutchley v. Mann, 8, 31. Cumber v. Wane, 116. Currie v. Hodgins, 117. XVI. Bills of Exchange Act, 1890. D Dalby v. Humphrey, 17, 105. Darling t'. McLean, 119. Dash V. VanKleeck, 169. Davidson v. Robertson, 129. Davies v. Funston, 104. Davis V. Dodd, 127, 128. Davis V. Dunn and Parke, icS. Davis V. Jones, 10. Decroix v. Meyer, 13, 14, 30, 41, 59. DeLa Courtier v. Bellamy, 10. Dickinson ?'. Bowes, 158. Dickinson v. Valpy, 37. Doe dem. Anderson i'. Todd, 127. Downey v. Parnell, 17. Doyle V. Carroll, 46. Drake v. Rogers, 10, 20. Dptton J'. Marsh, 162. Emmett ;'. Tottenham, 51. Esdaile v. Sowerby, 79. Evans 11. Drummond, 116. Ewin i'. Lancaster, 118. Faith I'. Richmond, 36. Fearn v. Filica, 38. Federal Bank 7'. Hope, 153. Federal Bank v. Northwood, 36. Fellows V. Ottawa Gas Company, 98. Fetters v. Muncie National Bank, 44. Fisken v. Meehan, 56. Fitch V. Kelly, 115, 166. Fitch i;. Sutton, 116. Foakes i'. Beer, 116. Foster v. Dawber, 1 1 1 . Foster v. Geddes, 41. Foster I'. Mackinnon, 115. Francis v. Bruce, in re George, 18, 112, 156, 162. Freakley v. Fox, iii. Table of Cases Cited. G Garland v. Thompson, 43. Garrard v. Lewis, 16, 31. General South American Company, in re, 107, 108. George in re Francis u. Bruce, 18, 112, 156, 162. Georgian Bay Lumber Company v. Thompson, 43. Geralopulo v. Wieler, 123, 164. Gerinania Bank v. Distler, 20. Gibb V. Mather, 158. Gibbs 7f. Fremont, 17, 133. Giles V. Bourne, 10. Girvin v. Burke, 7, 50. Glasscock v. Balls, 18, 74, 117, 156. Good V. Martin, 104. Goodall V. Dollev, 90. Goodwin ?/. Roberts, xxix. Gore V. Gibson, 35. Gould V. Robson, 119. Grant v. People's Loan & Dep. Co., 17, 106. Gvayi^. Johnson, 139. Greenslade v. Dower, 37. Greenwood v. Foley, 8, 16. XVll. H Hagerty v. Squier, 41. Hague V. French, 10. Halcrowi'. Kelly, 114. Halifax v. Lyle, 102. Hall V. Merrick, 115, 153. Hall V. Prittie, 9, 99. Hansard v. Robinson, 128. Hardy v. VVoodruffe, 77. Harrop v. Fisher, 52. Harvey i". Towers, 48. Hawkes v. Salter, 83, 88. Hay V. Burke, 87. Healey v. Dobson, 118. Hedley v. Bainbridge, 37. Hemp V. Garland, 16. Heywood v. Pickering, 77, 141. Hindhaugh v. Blakey, 27. Hine v. Alley, 76. xvni. Bills of Exchange Act, 1890. fi;'' Hill V. Royds, 98. HirschBeld v. Smith, 58, 135. Hitchcock u. Huinphtfiv, 82. Hoare v, Gazenove, 122. Holdsworth v. Hunter, 130. Holmes v. Kerrison, 24. Holmes v. Kidd, 50. Holmes i;. Thompson, 17. Hope V. Caldwell, 134. Hopkins v. Ware, 89. Hopkinson v. Forster, 99, 138. Hopley V. Dufresne, 90. Horford v. Wilson, 90. Home V. Roquette, 135. Hovey v. Cassels, 36. Howell V. McFarland, 51. Howes V. Bowes, 158. Huber ?'. Steiner, xxxi. Hudson V. Fawcett, 105. Hughes V. Canada Permanent Loan & Savings Society, 139. Hutton V. Eyre, 118. lanson v. Paxton, 56, no. Ingham v. Primrose, 34. Ingle V, Richards, in. Irwin V. Brown, 5. I J Jackson v. Hudson, 93. James v. Catherwood, 133, James v. Williams, 117. Jamieson v, Swinton, 83. Jenks V. Doran, 34, 38, 55, 114. Johnson v. Keenan, 109. Johnson v. Windle, 34, 38. Johnston v. CoUings, 28. Jones V. Broadhurst, 109. Jones V. Goodwin, 104. Jones V. Gordon, 49, 161. Jury V, Baker, 152. Table of Cases Cited. XIX. K Kaiser v. Boyriwon, 15. Kearney v. West Granada Gold and Silver Mining Co., 129. Kearslake v. Morgan, 117. Keene v. Beard, 4, 138. Kendall v. Hamilton, 12. King V. Hoare, 12, 117, 154. King V. Zimmerman, 129. Kirk V. Blurton, 36. Kneeshaw v. Collier, 46. La Banque Jacques Cartier v. La Banque D'Epargne, 38. La Banque Jacques Cartier v. Strachan, 129. La Banque Nationale v. Sparks, 31. Lamb v. Sutherland, 9, 99. Langridge v. Dorville, 42. Lapp V. Firstbrook, 43. Laws V. Rand, 141. Leake v. Duffield, 36. Lee V. Bank British North America, 153. Lennig v. Ralson, 31. Lewis V. Parker, 61. Lockridge v. Lacey, 15. London and South Western Bank v. Wentworth, 100. London, Birmingham and South Staffordshire Bank (Limited) in re, n8. M Madden v. Cox, 41. Maillard 7>. Duke of Argyle, 118. Marseilles Extension Railway & Land Company in re Small- pages and Brandon's Cases, 132. Marzetti v. Williams, 139. Mason v. Bickle, 19, 115. Mathieson ?'. London and County Bank, 151. Matthews 7>. Baxter, 35. Megginson 7'. Harper, 61. Mellersh ?'. Rippen, 84. Mellish 7/. Rawdon, 81. Mellish 7/. Simeon, 108. Merchants' Bank v. Bell, 87. r ' XX. Bills of Exchange Act, 1890. Merchants' Bank v. Bostwick, 38. Merchants' Bank v. Lucas, 38. Merchants' Bank v. McDougall, 89, 166. Merchants' Bank v. McKay, 119. Merchants' Bank v. Robertson, 42. Merchants' Bank v. United Empire Club, 35, 102, 162. Merritt v. Cole, 162. Mertens v. Winnington, 135. Miers v. Brown, 83. Milnes v. Dawson, 43. Minet v. Gibson, 13. Misa V. Currie, 4a. Mitchell V. Baring, 121. Mitchell V. English, 56. Moffatt V. Rees, 104. Molsons' Bank ?'. Brockville, 40. Molsons' Bank v. Girdlestone, 119. Molsons' Bank v. McDonald, 118, 119. Molton V. Camroux, 35. Montague v. Perkins, 19, 20. Montreal City Bank v. Corporation of Perth, 98. Montrose v. Clark, 32, 44. Moore v. Durden, 169. Moore v. Jackson, 36. Mortgage Ins. Corporation 7/. Commissioners Inland Rev. ,8, 152. Muilman v, D'Eguino, 81. Muirf. Crawford, 118, 119. Mulford V. VValcott, 124. Murray Yt, Purdham v. Murray, 43. Mc Macdonald v. Whitfield, 56, 104. Macintosh v. Haydon, 98. McConnell v. Wilkins, 37. McCord V. Field, 37. McDougall re, 106. McGregor v. Bishop, 43. McKelveyt/. Davis, 56. McLean v. Clydesdale Banking Co., 4, 42, 138, 142, 169. McLeish v. Howard, 139. McQueen v. Mclntyre, 115. Table of Cases Cited. XXI. N Napier v. Schneider, 108. National Bank, Third, v. Cosby, 8, 16. Nicholson v. Revill, 118. Nightingale v. City Bank of Montreal, 98. Norton v. Ellam, 61, 156. Odell V. Cormack, 36. Ogden V. Benas, 150. O'Keefe v. Dunn, 62. Oriental Financial Corporation v. Gurney, 44. "8, 155- Oriental Financial Corporation z/. Overend, 44. "8, 155. Oulds V. Harrison, 60. Owens V. Quebec Bank, 150. Parkei v. Gordon, 67, 74. Parking. Moore, 61. Passmore 7>. North, 20. Penny v. Innes, 102, 104. Perkins v. Beckett, 35, loi, 159. Peruvian Railways Co. ■y.Thames& Mersey Marine Ins. Co., 35* Phillips 7/. ImThurm, 13. 122. Phipson V. Kelner, 90. Pillans V. Van Mierop, 27. Pinard v. Klochman, 130. Pinnel's Case, 116. Popplewell V. Wilson, 42. PorteousT/. Muir, 153. Powell V. Monnier, 28. Powell V. Peck, 17, 106. Pressy v. Trotter, 42. Price t/. Barker, 118. Price V. Price, 117, 118. Prideaux v. Criddle, 76, 139. Prince z/. Oriental Bank Company, 83, 113, 150. Purdham v. Murray, 43, 52. XXll. Bills of Exchange Act, 1890. Q Queen v. Chesley, 115. Quinlan v. Gordon, 49. R Ramuz v. Crowe, 128. Reed 7;, White, n6. Regina v. Barnes, 127. Regina v. Berriman, 21. Reid V. Humphrey, 115. Reynolds v. Doyle, no. Richardson v. Ellett, 10. Richmond v. Heapy, 37. Robarts ex parte, re Gillespie, 4, 106, 107. Roberts v. Bethel, 28, 61. Roberts v. Tucker, 30, 63, 100. Robertson v. Caldwell, 134. Robertson v. Kelly, 35. Robertson v. Kensington, 57. Rolin V, Steward, 139. Robinson t/. Hawksford, 141. Roche V. Campbell, 158. Rogers v. Langford, 108. Rose-Belford Printing Co. v. Bank of Montreal, 150. Rosher v. Kieran, 82. Ross V. Williamson, 96. Rothschild v. Currie, 135. Roquette v. Overman, 136. Rowe V. Young, 72. Royal Canadian Bank v. Wilson, 36, Ryan v. Bank of Montreal, 63, 100. Ryan u. McConnell, 82, 119. Ryan v. McKerrel, 42. Sarnia Agricultural Implement Manufacturing Co. (Limited) v. Hutchinson, 153. Saul V. Jones, 79. Saunderson v. Bowes, 158. Saunderson v. Judge, 158. Saunderson v. Piper, 16. I! ril Tablk of Cases Cited. xxin. Sayer v. Wagstaff, ii8. Sayles V. Brown, 115. Schroeder v. Central|Bank, 99. Seldenridge v. Connable, 10. Serle v. Norton, 141. Shand v. Du Buisson, 99. Shanley v. Midland Central Railway Co., 117. Shaw V. Croft, 82. Sheard v. Laird, 46. Shepley v. Hurd, 51. Shorey v. Jones, 46. Sibree v. Tripp, 116. Siddall V. Gibson, 158. Simmons v. Taylor, 144, 147. Simonton v. Graham, 17, 106. Sinclair v. Chisholm, 106. Sinclair v. Robson, 95. Sloman v. Cox, 118. Small V. Riddell, 51. Smith V. Knox, 45. Smith V. Martin, 47, 48. Smith V. Union Bank of London, 63, 144, 148. Smith V. Whiting, 84. Snaith v. Mingay, 31. Snow V. Peacock, 63. S'-'arte v. Palmer, 84. Somerville v. Rae, 115. Southam v. Ranton, 166. South American Co., re, 5. Standard Bank v. Dunham, 37. Stanton v. Blossom, 82. Star Kidney Pad Co. v. Greenwood, 43. Steadman i. Gooch, 117. Steele v. McKinlay, 27, 103. Steer v. Adams, 104. Steinhoff v. Merchants' Bank, 83. St. John V. Rykert, 17, 106. Stockman v. Riley, 18. Storms V. Sterling, 153. Story V. McKay, 133, 134. Strong V. Bird, in. Sturdy v. Henderson, 24. Sturtevant v. Ford, 60. Sugden v. Lord St. Leonards, 96. XXIV. Bills of Exchange Act, 1890. Swaisland v. Davidson, 49, 114, 152. Swan ex parte, 126. Swan I'. North British Australasian Co., 115. Swasey v. Vanderheyden, 35. Swift V. Tyson, 42. Swire v. Redman, 155. Synod of Toronto v. De Blaquiere, 119. '! Tatam v. Haslar, 48. Temple v. Toronto Stock Exchange, fig. Terry v. Parker, 79. Thacheray v. Blackett, 129. Thomas v. Bishop, 41. Thompson 11. Feeley, 41. Thompson v. Percival, 116. Thompson v. Wilson, 117. Thorold Manufacturing Co. v. Imperial Bank, 38, 40. Timmins v. Gibbins, 108, 150. Tindal v. Brown, 67. Tondeur ex parte, 69. Toponce v. Martin, 133, 134. Torrance v. Bank of British North America, 28. Tregothick v. Edwin, 158. Trueman v. Hurst, 35. Turner v. Sanson, 79. V Vagliano v. Bank of England, 13, 30, 63, 10 1, rir Vail V. Duggan, 21. Vanderlip v. Smith, 51. Van Wart v. Woolley, 108. Voyer v. Richer, 153. w ^2iC\ievha.ih ex parte, 126. Ward V. Evans, 108. Walker i^. Hamilton, 5, 107. Walker V. Macdonald, 14. Walker v. Stetson, 64. Wallace v. Souther, 8, 16, 56. Table of Cases Cited. XXV. Walton V. Mascall, 82. Wambold v. Foote, 82. Warne v. Lawrence, 95. Warwick v. Rogers, 113. Watts V. Mitchell, 46. Welby V. Drake, 116. West London Commercial Bank v. Kittson, 40, 41. Westloh V. Brown, 90, 102, 114. Whistler v. Forster, 52. White V. McKay, 51. Wiley V. Ledyard, 153. Wilkinsv. Jadis,67, 74. Wilkinson v. Unwin, 104. Williams v. Germaine, 122. Williamson v. Johnson, 36. Williamson v. Watts, 35. Wilson V. Brown, 37, 98. ii9- Wilt V. Lai, 21. Wirth V. Austin, 79. Woodland v. Fear, 150. Woodward v. Pell, 117. Wordsworth v. McDougall, 104. Wright V. Shawcross, 86. Wright V. Wright, 42. Young V. Grote, 34, ii5- I i I;. I ■I- I LIST OF ABBREVIATIONS. Byles on Bills.. 14th English Edition, when the edition is not men- tioned. Daniel on ^ Negotiable J- 3rd Edition, New York, 1882. Instruments. -' Chalmers on ■» Chalmers' Digest of the Law of Bills of Exchange, Bills J 3rd Ed., London, 1887. U. C. R Upper Canada and afterwards Ontario Queen's Bench Reports ; volumes i to 46 inclusive. C. P Upper Canada and afterwards Ontario Common Pleas Reports ; volumes i to 32 inclusive. Gr Grant's Chancery Reports in Upper Canada and afterwards Ontario; volumes i to 29 inclusive. P. R The Ontario Practice Reports, volumes i to 12 inclusive ; volume 13 now current. A. R The Ontario Appeal Reports, volumes i to 17 in- clusive ; volume 18 now current. O. R The Ontario Reports of Cases decided in the Queen's Bench, Common Pleas and Chancery Divisions of the High Court of Justice, volumes I to 18 inclusive; volume 19 now current. O. S The Old Series of Upper Canada Reports. C. L. J. OR Can.^ The Canada Law Journal, Toronto, volumes i to Law Journ. , . J 25 inclusive; volume 26 now current. S. C. R Supreme Court Reports of the Dominion, volumes I to 16 inclusive ; volume 17 now current. L. C. JuR Lower Canada Jurist, 20 volumes. In the citation of the English and American Reports the well- established modes of citation have been strictly adhered to and need not be recapitulated here. i;l!Ci*: 4f INTRODUCTION. In an elaborate treatise on the subject of bills of exchange and promissory notes it might be deemed part of the duty of the author to enter into a detailed history of these important instruments. As the design of this work is to present at the earliest possible moment the law, as it is in Canada, since the passage of the '' Bills of Exchange Act, 1890," no such attempt will be made in the course of the following pages. The reader and the student are alike referred to the excellent review of their origin to be found in the able judg- ment of Cockburn C.J. in Goodwin v. Roberts, L.R. 10 Exch. p. 337. It will be sufficient for the present purpose to explain that Bills of Exchange are of much older use than promissory notes. Bills of Exchange were not known to the Civil Law. They seem to have been first current in the little mediaeval States of Italy, whence their use gradually passed to France and some other parts of the continent of Europe, and still later to England.' The law of Italy was founded upon the Civil Law, or it might be more correct to say, was in fact the Civil Law modernized to suit the innovations of commerce; and perhaps it thus happens that some of the chief incidents of bills owe their origin to the Civil Law in its modern application : e.g. the presumption of consideration in their favour,'' contrary to the general rule of the Common Law which pre- vails respecting all other simple contracts. From the universality of the usage of bills the law relating to them obtained recognition as a portion of the Law Merchant and was eventually acknowledged as an integral part of our Common Law. This recognition was doubtless however not effected until many a struggle between Westminster Hall and the mercantile world. 'Goodwin v. Roberts, L.R. 10 Exch., per Cockburn C. J. at p. 346. •See Justinian Inst. Tit.XV., " De Verborum Obiigatione," as to contracts which were binding irrespective of any consideration. fl ! • ! »y :t XXX. Bills of Exchange Act, 1890. Promissory notes were placed on the same footing with bills of exchange by the Statute 3 & 4 Anne, Cap. 9. " That Act was passed in consequence of the refusal of Lord Holt to concede to the custom which had sprung up among merchants of treating promissory notes as negotiable, the effect which would, at a somewhat later period, probably have been attributed to it. His Lordship, departing some- what from that excellent good sense which usually characterized him, treated the endeavour to uphold the negotiability of promissory notes with some indignation, saying that " it proceeded from the obstinacy and opinionativeness of the merchants, who were endeavouring to set the law of Lombard Street above the law of Westminster Hall.'" The Imperial " Bills of Exchange Act, 1882 " which is the basis of our own Act, is said to have been the first English attempt at a code. Sir Henry Maine in his Ancient Law says : " the most cele- brated system of jurisprudence known to the world begins, as it ends, with a code."- Whether the codification of the law relating to bills marks a return to primitive simplicity, or is a step in the more perfect development of our system of jurisprudence, will remain, for some future writer, with more time at his disposal than the present, an interesting subject of enquiry. In any event the utility of the measure is not open to question. The advantage of an Act, which in less than one hundred sections embraces the whole body of the law, is apparent. In a single sentence the finality of the law is now estab- lished, which in the past has been perhaps the subject of endless litiga- tion, involving great expense, and often ruin to unfortunate suitors. Propositions which the text writers hitherto enforced by reference to a "codeless myriad of precedents " are in the Act definitely set at rest in the course of a section and often in a single sentence: and it is fondly hoped that the student toiling at " Mastering the lawless science of our law, That wilderness of single instances," will find a pathway beaten out for him here, which will save him many hours of weary labour. Leaving out of the question the advantages or disadvantages of codes, it must be acknowledged that the state of the Law in Canada before the act was most unsatisfactory. Perhaps it would not be an >Sm. Merc. Law, loth Ed. p. 223 ; see Clark v. Martin, 2 Ld. Raym. 757 'Ancient Law, p. i. Introduction. XXXI. exaggeration to assert that the law of Bills and Notes was scarcely identical in any two Provinces. In the "Act Respecting Bills of Exchange and Promissory Notes," R.S.C Cap 123, its complexity was evinced by the fact that many of the sections were framed for and applied to individual provinces ; whilst in the Province of Quebec the Civil Code intervened with enactments which even in their term- inology, not to speak of their provisions, were unfamiliar to the law. yers of the sister Provinces. As the power of legislating with regard to bills and notes resided exclusively in the Dominion Parliament, it devolved upon that legislature to deduce order out of chaos, and to introduce homogenity throughout the Dominion in the law respecting them. After most careful preparation this arduous task was as- sumed by the present Minister of Justice, the Honourable Sir John Thompson, and the success which has attended his efforts will be a lasting monument to the skill and abihty with which he performs the onerous duties of his high office. Hereafter a bank, merchant, or oMier person taking a bill or note drawn or made, indorsed or payable in another Province, may rely on the uniformity of the law in such other Province, and is in no danger of being misled by differences in modes and places of payment as hitherto. A noticeable instance of the inconvenience existing before the Act, occurred in a case' where a note made in Ontario was payable at the Mechanics' Bank, Montreal, without restrictive words, and the maker assumed that the law of Quebec was the same as that of his own Province, and that the note was payable generally. For some purposes it will still, however, be necessary to consider the laws of the different Provinces in matters relating to Bills and Notes. The Statute of Limitations is a law of the remedy,"" and the time when the remedy is barred will depend on the law of the Prov- ince where payment is attempted to be enforced by action. As the Statute of Limitations is not uniform in the several Provinces it will be necessary for the future as in the past to be cautious in this particular. The capacity to contract will also depend on the law of the several provinces, and the rule locus regit actum will apply. If there- fore a married woman, domiciled in another Province, becomes a •Court V. Scott, 32 C.P. 148. "Huber v. Steiner, 2 Bing. N.C. 202 ; British Linen Co. v. Drummond, 10 B & C. 903. XXXIl Bills of Exchange Act, 1890. party there to a bill or note, her liabiUty will be governed by the law of that Province. Should she enter into a contract in a Province other than that of her domicile the tendency at least of English and Ameri- can law is certainly in favour of its validity being ascertained by the lex loci contractus. It will thus be seen that section 71 of the Act respecting " Conflict of Laws " will not be confined exclusively to the consideration of foreign bills. The identity of our Act in its main features with the English Act must prove beneficial. English decisions will be directly in point and will secure harmony in the construction of the Act in all parts of Canada. The particulars in which our law now differs from the English are pointed out in the notes to section 2 of the Act at page i post. On the 1 2th June, 1890, an order was passed by His Excel- lency the Governor-General in Council, to the effect that the English rather than the American mode should be followed in future in spelling the final syllable of such words as " honour " in all official documents in the Canada Gazette and in the Dominion Statutes. This order was not passed in time to affect the Statutes of last Session, but it has afforded me very great pleasure to conform to the rule in the text of my work, and I have taken the liberty in order to secure uniformity to correct the spelling in the Act. In my reference to "The Bank Act," 53 Vic, Cap. 31 (Dom.), I have referred to it as *' The Bank Act " now in force, to prevent confusion. Readers will kindly bear in mind that this phraseology was adopted in view of the fact that this work is not intended merely for use during the next few months. As a matter of fact " The Bank Act " in question does not come into force until the first of July, 1891- E. H. S. 53 Victoria.] [C«A 33, Dom. AN ACT RELATING TO BILLS OF EXCHANGE, CHEQUES AND PROMISSORY NOTES. HER MAJESTY, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows : — Part I. PRELIMINARY, 1. This Act may be cited as of Exchange Act, 1890." "The Bills Shor, Title. {Imperial Act 43 and 4.6 Vic, Cap. 61, Sec. i.) The power to legislate respecting Bills of Exchange and Promissory Notes is limited by " The British North America Act, 1867," to the Dominion Parliament. See that Act, 30 and 31 Vic, Sec. 91 (18). (Imp.). This Act is based on the English Act, 45 and 46 Vic, Cap. 61, " The Bills of Exchange Act, 1882." It is in effect a codification of the law relating to Bills and Notes, as it existed at its passage, amended in a few particulars. The primary object of its introduction was not so much to amend the law, as to render it uniform in the several Provinces, and this end has been attained, except that the statutory holidays in the Province of Quebec are somewhat more numerous than in the other Provinces, and that the fees and provisions as to protests are not identical in Quebec with those in the others. f i 2 Hills of Exchange Act, 1890. Sec. I. The law of Canada may now be said to be the same as the English law on the subject of Bills and Notes, with perhaps only the following exceptions : The Canadian Act preserves the princ.ple that where the last day of grace is a Sunday, or statutory holiday, the bill or note is |)ayable, not as in England, on the preceding, hut on the following day; that sight bills in Canada bear days of grace; that a banker is not deemed here to have paid a demand draft, in due course, when the indorsements have been forged, or made without authority ; and that the practice, or rather the pro- priety of the practice, of protesting inland bills and notes is recognized by our Act. The Act alters the law in Ontario which was practically the English law, except in the instances first pointed out, in — Sec. 4 (2). Hy making a bill prima facie an inland bill. Sec. 6. (2). Providing that a bill may be drawn on two or more persons jointly, but not in the alternative. Sec. 7. (2). That a bill may be payable to two or m(»rc payees either jointly or in the alternative, or to the holder of an office for the time being. S(c. 7. (3). That when payable to a fictitious payee or non-existing person, a bill may be treated as pay- able to bearer. Sec. 8. (i), (3) and (4). Making new provisions as to the negotiability of bills, the chief of which is that the omission of the word " order " will not of itself restrain the negotiability. Sec. 12. Authorizing the insertion of the date when omitted. Sec. 1 5. Providing for resort to a referee in case of need. Sec. 18. (2). Fixing the date in case of acceptance after dishonour. Sec. 24. Providing that the drawer of a cheque, if payee's name is forged, must give notice to the rKELIMINAKV. 3 drawee within one year after he has acquired notice Sec. x. thereof. Sec. ;ii. Permitting conditional indorsements to be disregarded. Sec. 36. (3). Making provision when bills payable on demand shall be overdue. Sec. 39. (4). Excusing delay for presentment for acceptance in some cases. Sec. 41. (2). E.xcusing presentment for acceptance in certain cases. 'Sec. 42. (living two days for acceptance after the day of presentment. Sec. 44. (2) (3). Defining the effect of qualified acceptances. Sec. 45. (7). Providing for presentment at post- offices. Sec. 49. (i), (/). Making the return of a dis- honoured bill equivalent to notice of dishonour. Sec. 51. (2). Making the protest of foreign bills compulsory. Sec. 52. (2). Dispensing with presentment at the place of i)ayment, when specified, on the day of maturity, as far as the acceptor is concerned, and providing for the costs of action in that case. Sec. 60. Providing that a bill be discharged, if the acceptor becomes the holder at, or after, maturity. Sec. 61. (i) (2). Defining renunciation. Sec. 63. (i). Making an altered bill valid in some cases. ♦ Sec. 71. (2), (/). Making Notarial Instruments of Protest, made out of Canada, prima facie evidence. Sec. 72. Enacting that a cheque is a Bill of Exchange. 4 Bills of Exchange Act, 1890. Sec I Sec. 73. Requiring cheques to be presented within a reasonable time. Sec. 90. (2). Providing that the sealing of bills he equivalent to signing, etc., by corporations Sec. 91. Laying down a rule for the computation of time. Sec. 92. Making noting sufficient in some cases. Sec. 93. Providing for protests by Justices of the Peace. Sec. 94. Enacting that dividend warrants may be crossed. Some of these amendments are rather declaratory of than in alteration of the Common Law. Such, for instance, as Sec. 72 enacting that a cheque shall be a Bill of Exchange. A cheque was always deemed in effect a liill of Exchange. ' Sections 75 to 81 inclusive introduce the practice of crossing cheques in Canada. Sections 19 (2), 52 and 86 change the law, as far as Ontario and Prince Edward Island are concerned, and abolish the distinction between bills and notes, payable generally and at particular places, and make the addition of the words " only, and not otherwise or elsewhere " hereaftv r unnecessary. In the Imperial Act, Section 97 (2) provided that "the rules of ti.e Common Law including the Law Merchant, save in so far as they are inconsistent with the express pro- visions of this Act, shall continue to apply to Bills of Exchange, Promissory Notes and Checjues." Though retained in our Act as originally introdui^ed, this section was struck out by the Senate through a desire that the Act should have completeness as a code. The convenience of the provision of the enactment referred to was exemplified in Exparte Robarts re Gillespie, 6r Q. B. I). 702, where it was held that Sec. 57 is only 'Keene v. Heard, 8 C.B Banking Co., g App. Gas. .35. N.S. 372; McLean v. Clydesdale Preliminary. 5 intended to describe the damages which may be treated as Sees, i, 2. liquidated, for the purpose of special indorsement on a writ, and that it is still therefore the law by force of Sec. 97 (2) as laid down in Walker?'. Hamilton, i D. F. & G. 602, and in re General South American Co., 7 Ch. D. 637, that the drawer of a bill, drawn in a foreign country, but accepted in England, is entitled, upon the bill being dishonoured and protested, to recover from the acceptor, not only the amount of the bill with interest, but also, all such reasonable expenses as may have been caused by dishonour, including the expenses of re-exchange. Some difficulty may hereafter arise here from the absence of such an enactment in our code. 2. In this Act, unless the context otherwise in'^preta ' tion. requires, — {a) The expression " Acceptance " means an "Accept- acccptance completed by delivery or notifi- cation. {Imperial Act 43 and 4.6 Vic, Cap. 6/, Sec. 2.) As to notification see post proviso to Section 21. {b) The expression "Action" includes counter- "Action. claim and set-off. A counter-claim is not an action.' {c) The expression " Bank" means an "Bank." incorporated Bank or Savings Bank carrying on business in Canada. This sub-section in the Imperial Act includes a body of persons whether incorporated or not. The word " Bank " 'Irwin V. Brown, 12 P.P.. 639. I ■ f! ! 6 Bills of Exchange Act, 1890. Sec. 2. when used in this Act is not limited to those to which the Banking Act apph'es. " Bearer.' "Hill;" 'Note." (d) The expression " Bearer " means tKe person in possession of a Bill or Note which is payable to bearer. " Payable to bearer " that is, on its face, so that the holder of a Bill or Note originally payable to order, and indorsed in blank, is not within this definition, although such bill thence- forward becomes payable to bearer ; Sec. 8 (3). (^) The expression "Bill" means Bill of Exchange, and " Note " means promissory note. See post Sec. 3 and Sec. 82, where these instruments are defined. •t ! I i "Delivery." (y) The cxpression " Delivery " means trans- fer of possession, actual or constructive, from one person to another. It is essential to a valid indorsement that it should be followed by delivery, />osf suli-section (//). " Holder." ' Indorse- ment." (g-) The expression " Holder " means the payee or indorsee of a bill or note who is in possession of it, or the bearer thereof. The word " Holder " is the generic term, and includes " unlawful holder," as a thief or finder ; a holder who holds lawfully, but not for value ; a holder for value, see definition of. Sec. 27 (2) ; and a holder in due course. Sec. 29. {/i) The expression "Indorsement" means an indorsement completed by delivery. Preliminary. 7 It must be written on the Bill itself or on an allonge, post Sec. 2. Sec. 32. e Delivery is defined ante sub-section (Si). (i) The expression " Issue " means the first "issue- delivery of a bill or note complete in form to a person who takes it as a holder. It is the delivery of the bill, etc., to the first person who holds it for value and can sue upon it.' (y) The expression "Value" means valuable "^^•"'•" consideration. This, like all the preceding sub-sections, is mere inter- pretation. The expression " valuable consideration " is defined at length, /<7^/ Sec. 27. (/&) The expression " Defence " includes " Defence.- counter-claim. This sub-section, which is not in the Imperial Act, was added in the Senate. It must not be overlooked that this section is introduced by the words : " In this Act unless the context otherwise requires." The interpretation clauses, therefore, must be used in this restricted sense, and are not of general appli- cation. »SeeGirvin v. Burke, 19 OR. 204, which distinguishes between the issue, i.e., the delivery between the original parties, and all sub- sequent transfers. ;| I 8 Bills of Exchange Act, 1890. Part II. BILLS OF EXCHANGE. i il Bill of exchange defined. FORM AND INTERPRETATION. 3. (i). A bill of exchange is an unconditional order in writing, addressed by one person to another, signed by the person giving it, requir- ing the person to whom it is addressed to pay, on demand or at a fixed or determinable future time, a sum certain in money to, or to the order of, a specified person, or to bearer. (Imperial Act 45 and 46 Vic, Cap. 61, Sec. j.) See /osf Sec. 11 as to what is a determinab . »uture time. "A sum certain in money." It must be a definite sum and nothing more.' A note made in Canada payable in Ameri- can currency at Chicago was held a good promissory note.' See further as to what is a sum certain, />osf Sec. 9. There must be a specified person to whom the bill is to be payable, or it may be payable to bearer. If left blank it is not a bill of exchange, but prima facie authority to the holder to fill it up, see Sec. 20 (i); and this was the law before the enactment.^ (2). An instrument which does not comply When in- strument is • • » . not such ^jj-j^ jj^ggg conditions, or which order^ ^ny act » Mortgage Insurance Corporation v. Commissioners of Inland Revenue, 21 Q.B.D. 352. « Third National Bank of Chicago:). Cosby, 41 U.C.R. 402; S.C. 43 U.C.R. 58 ; see also Greenwood v. Foley, 22 C.P. 352 ; Wallace V. Souther, 16 SCR. 717. » Crutchley v. Mann, 5 Taunt, 529 ; Bank of Toronto v. Coboure 7 OR. I. Form and Interpretation. to be done in addition to the payment of money, Sec. 3. is not, except as hereinafter provided, a bill of exchange. " Except as hereinafter provided," referring to the pro- vision contained in Section 9, that a bill may be payable according to an indicated rate of exchange, etc. These words are not in the Imperial Act. order defined. (3). An order to pay out of a particular fund "^"na"^;, is not unconditional within the meaning of this section ; but an unqualified order to pay, coupled with (a) an indication of a particular fund out of which the drawee is to reimburse himself, or a particular account to be debited with the amount, or (6) a statement of the transaction which gives rise to the bill, is unconditional. "Please pay W. H. the sum of $138.40 for flooring supplied to your buildings, etc.," was held not an order to pay out of a particular fund, but a bill of exchange and to require acceptance." An order to pay out of a particular fund may operate as an equitable assignment ;° a bill of exchange does not ; see />os^ Sec. 53. This was the law before the Act.' (4). A bill is not invalid by reason — (a) That it is not dated ; (d) That it does not specify the value given, or that any value has been given therefor ; (c) That it does not specify the place where it is drawn or the place where it is payable. ' Hall V. Prittie, 17 A.R. 306. » Buck V. Robson. 3 Q.B.D. 686. ' Lamb v. Sutherland, 37 U.C.R. 143. Bill no> invalid for reasons specified. 10 Bills of Exchange Act, 1890. Sees. 3, 4, The true date may be inserted by any holder, Sec. 1 2 S* (i). If there be no date the bill will be considered as dated at the time it was issued." The date may be shown by paroL^" Where the date of a note bearing interest from date has been omitted, the date of its delivery may be shown and interest computed from that time.' It may be shown that there is a mistake in the date.* It was considered well settled before the Act that the words value received •viQTQ not at all material. Byles on Bills, 95. ini.. ^ and foreign bills I If not noted as foreign. If different parties to bill are the same person. Option of holder in case specified. 4. ^i). An inland bill is a bill which is, or on the face of it purports to be, {a) both drawn and payable within Canada, or {b) drawn within Canada upon some person resident therein. Any other bill is a foreign bill. (2). Unless the contrary appears on the face of the bill, the holder may treat it as an inland bill. {Imperial Act 4.5 and 46 Vic, Cap. 61, Sec. 4.) Sub-section (2) is new and is important in this, that a foreign bill must be protested, Sec. 51 (2); whereas an inland bill, except in the Province of Quebec, need not be. Sec. 51 (i), notice of dishonour alone being sufficient, and that may be given in any way provided by Sec. 49. 5. ( I ). A bill may be drawn payable to, or to the order of, the drawer ; or it may be drawn payable to, or to the order of, the drawee. (2). Where in a bill drawer and drawee are 1 De La Courtier v. Bellamy, 2 Show. 422; Hague 7>. French, 3 B. & P. 173; Giles V. Bourne, 6 M. & Sel. 74; Seldenridge v. Connable, 32 Indiana 375. " Davis V. Jones, 17 C.B. 625. 8 Richardson v. Ellett, 10 Texas 190. ♦ Drake v. Rogers, 32 Maine 524, :1 Form and Interpretation. II the same person, or where the drawee is a ficti- Sees. 5,6, tious person, or a person not having capacity to contract, the holder may treat the instrument, at his option, either as a bill of exchange or as a promissory note. {Imperial Act 45 and 46 Vic, Cap. 61, Sec. J.) As to the meaning of the expression " a fictitious person," see Vaglianor'. Bank of England, 23 Q.B.D. 243. " Person " by the Imperial Act included " a body of persons, whether incorporated or not." This was deemed to be an unneces- sary provision in our Act, for by our Interpretation Act, R.S.C., Cap. I, Sec. 7 (22), "person" includes "any body corporate and politic or party, etc." Persons not having capacity to contract would embrace infants, minors and corporations having no capacity or power to incur liability on a bill. As to the effect of indorsement by them, see Sec. 22 (2). 6. (i). The drawee must be named or other- bJnamed! wise indicated in a bill with reasonable cer- tainty. (2). A bill may be addressed to two or more ifthereare ^ ' ' more than drawees, whether they are partners or not ; but °"^ an order addressed to two drawees in the altern- ative, or to two or more drawees in succession, is not a bill of exchange. {Imperial Act 45 and 46 Vic, Cap. 6r, Sec. 6.) Hence the acceptors of a bill, unlike the makers of a note, must be jointly, and never jointly and severally, liable ; see Sec. 84. Unless all the drawees accept, it is a qualified acceptance ; Sec. 19 (2) {d). Judgment against one is a bar 12 Bills of Exchange Act, 1890. I 1 3 i! Secs.6, 7. to an action against the others,' even on the original con- sideration.- Certainty required as to payee. r. (i). Where a bill is not payable to bearer, the payee must be named or otherwise indicated therein with reasonable certainty. {Imperial Act 45 and 46 Vic, Cap. 61, Sec. 7.) An instrument not payable to bearer or a payee named or indicated with reasonable certainty is not a bill ; see notes to Sec. 3. The payee may be the holder of an office for the time being; see sub-section (2) ; if a fictitious person, it may be treated as payable to bearer, sub-section (3). upayabieto (2). A bill may be made payable to two or two or more \ ' ' *■ •' RoMlr'o7'° more payees jointly, or it may be made payable, in the alternative, to one of two, or one or some of several payees. A bill may also be made payable to the holder of an office for the time being. This is new. Formerly there could not be alternative payees.' Before the Act it was held in England, that an instrument payable to the Secretary of the Indian, etc.. Assurance Society, or order, was not a promissory note, the payee being uncertain.* non-existing, i^)' Where the payee is a fictitious or non- existing person, the bill may be treated as pay- able to bearer. Before the Act the acceptor of such a bill was only liable to a bona fide holder for valuable consideration in cases in ' King V. Hoare, 13 M. & W. 494. * Cambefort v. Chapman, 19 Q.B.D. 229 ; Kendall v. Hamilton, 4 App. Cas. 504. 3 Blanckenhagen z>. Blundell, 2 B. & Aid. 417. ♦ Cowie V. Stirling, 6 E. & B. 333. Form and Interpretation. 13 which it could be shown that the name of the payee was Sees. 7,8. fictitious to the knowledge of the acceptor." It was thought by some writers (see Byles on Bills, p. 91, note (w) at the end,) that the effect of this section would be to render it immaterial hereafter whether the acceptor knew it or not ; but the judgment of the Court of Appeal in Vagliano v. Bank of England, 2;^ Q.B.D. 243 at p. 261, seems to indicate that this is not the case. When a person drew a forged bill and selected the name of an existing firm as payees, who were not parties to the hill and were never intended to be, whose names he like- wise forged, it was held that the payees were not fictitious so as to make such bill payable to bearer. - s not 8 ( I ). When a bill contains words prohibiting ^aYi'fi," 1;'," transfer, or indicating an intention that it should "^'?°"*''''' not be transferable, it is valid as between the parties thereto, but it is not negotiable. (Imperial Act 43 and 46 Vic, Cap. 6/, Sec. S.J New — Striking out the word " order " after the name of the payee is not evidence of such an intention, as by sub- section (4) the omission of the word " order " does not affect the negotiability of the bill. ' If the bill is not negotiable, it cannot be assigned in Ontario. See Rev. Stat. Ont., Cap. 122, Sec. 13. (2). A negotiable bill maybe payable either ^X^oV to order or to bearer. (3). A bill is payable to bearer which is to bearer. expressed to be so payable, or on which the 1 Minet v. Gibson, iH. Bl. 569 ; Phillips v. ImThurm, L.R. i C.P. 463. " Vagliano v. Bank of England, 23 Q.B.D. 243. * Decroix v. Meyer, 25 Q.B.D. 343. I . 1 H Bills of Exchange Act, 1890. Sec. 8. only or last indorsement is an indorsement in blank. New. Before this if a bill were indorsed in blank, its negotiability could not afterwards be restrained by a special indorsement." Now, the bill will only be payable to bearer, where the only or last indorsement is an indorsement in blank, unless it is expressed to be payable to bearer on its face. In the latter case, no indorsement can be restrictive of its negoti- ability. To order. (4). A bill is payable to order which is expressed to be so payable, or which is ex- pressed to be payable to a particular person, and does not contain words prohibiting trans- fer or indicating an intention that it should not be transferable. Ill The effect of this sub-section is to radically alter the law. Hereafter a bill or note is negotiable notwithstanding the omission of the words " order " or ** bearer " after the name of the payee. This will prevent the recurrence of the dififi- culty, which arose in Bank of Hamilton v. Harvey, 9 O.R. 655, decided in 1885, which was affirmed on appeal to the Supreme Court; see 16 S.C.R., Ap/>. 714. In that case the makers of a note not negotiable were held liable to the indorsee of the payee, on the ground that it was signed by the makers with the intent that it should be used by the payee and that it was inequitable to take advantage of a mere mistake or inadvertence. When a bill payable to order was altered by the acceptor by striking out the word " order " it was held that it was still negotiable. ^^ The acceptance is not restrictive of the ' Walker v. Macdonald, 2 Exch. 527. ' Decroix v. Meyer, 25 Q.B.D. 343. Form and Interpretation. 15 negotiability, if it is expressed to be in favour of the payee Sect. 8, 9. only." Before the Act, a note not payable to order or bearer was absolutely non-negotiable. Nor could it have been assigned under Rev. Stat. Cnt. 1887, Cap. 122, Sec. 6 tt seq., as by Sec. 13, those sections do not apply to Bills and Notes. (5). Where a bill, either originally or byOpUo"°f indorsement, is expressed to be payable to the order of a specified person, and not to him or his order, it is nevertheless payable to him or his order, at his option. A bill payable to the order of A. B. is nevertheless payable to him or his order at his option, /. e., he can demand pay- ment without indorsement. Is he bound to give a receipt ? In England he would be under 43 Geo. III., Cap. 126, Sec. 5 — not in force here (in Ontario)." 9. (i) The sum payable by a bill is a sum ^^"^1,,^ certain within the meaning of this Act, although it is required to be paid — {a) With interest ; [b) By stated instalments ; {c) By stated instalments, with a provision that upon default in payment of any instalment the whole shall become due ; {(i) According to an indicated rate of ex- change, or according to a rate of exchange to be ascertained as directed by the bill. I ' Ibid. ' In Lockridge v. Lacey, 30 U.C.R. 494, it was held a person tendering money is entitled to require a receipt. See also Kaiser;^. Boynton,7 O. R. 143. Hi ■.b i ! \ I 'i i .f i6 Bills of Exc!ian(;k Act, i8' Sec. 9. {Imperial Act 45 and 46 Vic, Cap. 61, Hec. g.) As to the date from which interest runs, see sub-section (3) of this section ; as to the rate after maturity, see notes to that sub-section, and to section 57 («) (2). Although a l)ill can be drawn payable by instalments, it c Drake v. Rogers, 32 Me., 524; Germania Hank v. Distler, u N.V.r>.C.,(4Hun.),633. * Montague v. Perkins, 17 Jur. 537. Form and Interpretation. 21 it is antedated or post-dated, or that it bears date Sees. 13, on a Sunday (or other non-juridical day.) A bill is not invalid merely, if, in antedating or post-dat- ing it, a Sunday should happen to be selected. It can be shown that it was not the actual date. This section will not, it is submitted, have the effect of validating a bill actually drawn on Sunday, if otherwise void. See Rev. Stat. Ont. 1887, Cap. 203, sees, i and 8." The words in brackets are not in the Imperial Act. They were added in the Senate. It is difficult to see their utility, as no days but Sundays are dies nefasti under our Law. 141, (i). Where a bill is not payable on demand, {ioITonrnie the day on which it falls due is determined as ° p^^""""'- follows : — (a) Three days, called days of grace, are, in ^^^^^°^ every case where the bill itself does not other- wise provide, added to the time of payment as fixed by the bill, and the bill is due and payable on the last day of grace : (Imperial Act 4J and 46 Vic, Cap. 61, Sec, 14.) Under the Imperial Act a bill payable at sight is a bill payable on demand. See section 10 of that Act. It is other- wise in Canada and therefore sight bills bear days of grace, xs they are not excepted by this section. Provided that : ( I ). Whenever the last day of grace falls on Jj^^i'da's. a legal holiday or non-juridical day in the Pro- vince where any such bill is payable, then the ' Wilt V. Lai, U.C. Queen's Bench, Hilary Term, 13 Victoriac — not reported — where it was held that giving or taking a security on a Sunday is not void as a buying or selling. Reg. v, Berriman, 4 O.R. 282 ; Vail v. Duggan, 7 U.C.R. 568, <1 - t i 22 Bills of Exchange Act, 1890. Sec. 14. day next following, not being a legal holiday or non-juridical day in such Province, shall be the last day of grace. Under the Imperial Act, section 14, subsection (i) (a) the bill is due the day preceding the Sunday, or holiday, subject to some exceptions mentioned in the same sub-section {i){^) which are not material here. What shall be such. % . In all Provinces except Quebec. i : i '1 (2). In all matters relating to bills of exchange the following and no other shall be observed as legal holidays or non-juridical days, that is to say : (a) In all the Provinces of Canada, except the Province of Quebec — Sundays ; New Year's Day ; Good Friday ; Easter Monday ; Christmas Day ; The birthday (or the day fixed by proclama- tion for the celebration of the birthday) of the reigning Sovereign ; and if such birthday is a Sunday, then the following day ; The first day of July (Dominion Day), and if that day is a Sunday, then the second day of July as the same holiday ; Any day appointed by proclamation for a pub- lic holiday, or for a general fast, or a general thanksgiving throughout Canada ; and the day next following New Year's Day and Christmas Day, when those days respectively fall on Sun- day ; Form and Interpretation. 23 (d) And in the Province of Quebec the said Sec. 14. days, and also in Quebec. The Epiphany ; The Annunciation ; The Ascension ; Corpus Christi ; St. Peter and St. Paul's Day ; All Saints' Day ; Conception Day ; fc) And also, in any one of the Provinces of i" every > ' ' ^ ^ Province. Canada, any day appointed by proclamation of the Lieutenant-Governor of such Province for a public holiday, or for a fast or thanksgiving within the same, or being a non-juridical day by virtue of a statute of such Province. Taken from R.S.C. Cap. 123, Sec. 3. This statute repro- duced 35 Vic, Cap. 8, Sec. 8 (I)om.), as amended by 42 Vic, Cap. 47, and 46 Vic, Cap. 20, Sec. 11. 35 Vic, Cap. 8, formed part of the Bank Act. The Bank Act in force now 53 Vic, Cap. 31 (I)om.), contains no provision as to Bank Holidays. Consequently it is presumed that Banks will hence- forward be governed as to their holidays by the provisions of this Act— at least so far as the due date of bills and notes is concerned. (3). Where a bill is payable (at sight, or) at f^Tuted^ a fixed period after date, after sight, or after the beS tT happening of a specified event, the time of pay- "^""^ ment is determined by excluding the day from which the time is to begin to run and by includ- ing the day of payment. The words in brackets are not in the Imperial Act. Under that Act a bill payable at sight is payable on demand and n 24 Bills of Exchange Act, i860. Sec. 14. does not require to be accepted under Sec. 39. Under our Act, Sec. 39, a bill payable at sight must be presented for acceptance. At or after sight will mean at or after accept- ance.' A bill need not be accepted until the second day after presentment, Sec. 42 ; and a bill payable at sight is not due until the third day thereafter, see ante sub section (i) {a). In all other cases the period is computed by excluding the day from which the time begins to run, but including the day on which it falls due or would fall due but for the days of grace. When time begins to run. (4). Where a bill is payable at (sight or) a fixed period after sight, the time begins to run from the date of the acceptance if the bill is ac- cepted, and from the date of noting or protest if the bill is noted or protested for non-acceptance, or for non-delivery. i ■ ' Months." Reckoning of time. The words in brackets are not in the Imperial Act. An immediate right of recourse against the drawers and indors- ers accrues to the holder as soon as a bill is dishonoured by non-acceptance under Sec. 43 (2). It will be necessary to compute the time from the date of the noting or protest in the case of an acceptance for honour ; see Sec. 64 (5) : as to protest for non-delivery, see Sec. 5 1 (8). (5). The term "month" in a bill means (the) calendar month. Word in brackets not in Imperial Act. (6). Every bill which is made payable at a month or months after date, becomes due on the same numbered day of the month in which it is ' Holmes v. Kerrison, 2 Taunt. 323 ; Sturdy v, Henderson, 4 B. and Aid. 592 ; Campbell v, French, 2 H. Bl. 163. Form and Interpretation. 25 made payable as the day on which it is dated, Sees. 14, unless there is no such day in the month in which it is made payable, in which case it be- comes due on the last day of that month, with the addition, in all cases, of the days of grace. This sub-section is not in the Imperial Act, but is taken from R.S.C. Cap. 123, Sec. 95. It was originally introduced by the late Hon. John Hillyard Cameron' to remove a doubt, and was rather declaratory of, than in change of the Common Law.= Bills drawn respectively at one month after date on the 28th, 29th, 30th and 31st of January, will each of them fall due on the same day, namely the 3rd day of March, except in Leap Year, in which case the first named would fall due on the 2nd.' 1«S. The drawer of a bill and any indorser ^ell.**' may insert therein the name of a person to whom the holder may resort in case of need, that is to say, in case the bill is dishonoured by non-ac- ceptance or non-payment. Such person is called the referee in case of need. It is in the option of the holder to resort to the referee in case of need or not, as he thinks fit. (Imperial Act 45 and 46 Vic.^ Cap. 61, Sec. ij.) This is a new provision in Ontario. Under the Quebec code Art. 2290 it was obligatory to present the bill to the referee. Under this Act it is optional. Before a bill can be presented to the referee, it must be protested, see post Sec. 66 (i). ' 35 Vic, Cap. lo (Dom.). ' Campbell v. Lane, 25 Texas {supplement) 93 ; Byles on Bills, 6 Am. Ed. 204. " Byles on Bills, 12 Ed., p. 200; Chitty on Bills, 11 Ed., note at p. 264. I 26 Bills of Exchange Act, 1890. Sees. IS The referee in case of need is often simply called the case i6» *7' of need. This section is somewhat in modification of Sec. 6 (2), that there cannot be alternative drawees. ftfpKons •*• T^^ drawer of a bill, and any indorser, may Mindoreer. inscrt therein an express stipulation — (a) Negativing or limiting his own liability to the holder ; (o) Waiving, as regards himself, some or all of the holder's duties. IS ^ ? !!||' (Imperial Act 45 and 46 Vic, Cap. 61, Sec. 16.) This was the law before the enactment. An indorser might indorse without incurring responsibility, by the addi- tion, after his signature, of the words, in French, " sans re- cours" or in English, "without recourse," or any similar expression. He might also by apt words waive his right to presentment, notice of dishonour, etc. Although such indorse- ments are in a sense conditional, it is submitted, they are not within the provision of section 33 {qu. vide), if, indeed, such a question could ever arise. Definition 17, ( i ). The acceptance of a bill is the signifi- ance. catlott by thc drawee of his assent to the order of the drawer. (Imperial Act 4s and 46 Vic, Cap. 61, Sec //.) And he is thenceforward the acceptor. His mere signa- ture is sufficient, see next sub-section. If he omits the date, which would be material in a bill payable at or after sight, in order to ascertain the date of maturity, Sec. 14 (3), the holder may insert the true date. Sec. 12. Although, not free from doubt, under this Act, see Sec. 42, it is, nevertheless, con- ceived, that the true date, is the day of the date of the first presentment of the bill ; and this accords with strict mercantile practice, see Sec. 18 (3), where that date is assumed to be the proper date. \ Form and Interpretation. 27 ance. (2). An acceptance is invalid unless it com- Sec. 17. plies with the following conditions, namely : — Kcep?.^ ai (a) It must be written on the bill and be signed by the drawee. The mere signature of the drawee without additional words is sufficient ; (d) It must not express that the drawee will perform his promise by any other means than the payment of money ; (3). Where in a bill the drawee is wrongly designated or his name is misspelt, he may accept the bill as therein described, adding, if he thinks fit, his proper signature, or he may accept by his proper signature. Subsection (3) is not in the Imperial Act. See Section 32 (2) where there is a similar provision in the case of the payee of a bill payable to order. Compare this sub-section with R.S C, Cap. 123, Sec. 4. It was enacted by 19 and 20 Vic, Cap 97, Sec. 6 (Imp.), " that no acceptance * ♦ * ♦ shall be sufficient * * * * »n/ess the same be in writing on such bill and signed by the acceptor'^ Under this latter Act it was decided that the mere signature of the drawee was insufficient." Dissatisfac- tion with that decision led to the passage of the Imperial Act, 41 and 42 Vic, Cap. 13, which was "in effect a de- claration by the Legislature that the decision of the English Common Pleas Division in the case of Hindhaugh v. Blakey was erroneous."^ This sub-section reproduces the effect of 41 and 42 Vic, Cap. 13. At common law a mere verbal acceptance was sufficient ;' 785. ' Hindhaugh v. Blakey, 3 C.P.D. 136. ' Steele v. McKinlay, 5 App. Cas., 754, per Ld. Selbourne at p. » Pillans V, Van Mierop, 3 Burr. 1663. li I- i I. m li ii 28 Bills ok Exchange Act, 1890. Sees. 17, but not of a bill before it was drawn.' A letter promising to ^^' accept was also a good acceptance." Under this Act it is not an acceptance, but a mere agreement.' The acceptance may be by an agent ; see />osf Sec. 90. Time for acceptance. 18. (i). A bill maybe accepted — (a) Before it has been signed by the drawer, or while otherwise incomplete ; [d) When it is overdue, or after it has been dishonoured by a previous refusal to accept, or by non-payment. (Imperial Act 43 and 46 Vic, Cap. 61, Sec. j8.) Prima facie, a bill is deemed to have been accepted before maturity.* When it is accepted in an incomplete form, it is prima facie authority to the holder to fill it up, Sec. 20. When accepted overdue it is, as regards the ac- ceptor, a bill payable on demand, Sec. 10 (2). (2). When a bill payable after sight is dis- Date.in case of accept- duhonour. honoured by non-acceptance, and the drawee subsequently accepts it, the holder, in the absence of any different agreement, is entitled to have the bill accepted as of the date of first present- ment to the drawee for acceptance. This sub-section is new. Judge Chalmers, who was the draughtsman of the English Act, at page 41 of his work on " Bills of Exchange," says, "this sub-section was added in Committee. It accords with Mercantile practice and was ' Johnston v, Collings, i East 98 ; Bank of Ireland v. Archer, 1 1 M. & W. 383. * Powell V, Monnier, i Atk. 611 ; Billing v. Devaux, 3 M. & G. 565. ' See Torrance v. Bank of British North America, 5 P.C. 246 ; Bank of Montreal v. Thomas, i6 O.R. 503. ♦ Roberts v. Bethel, 12 C.B. 778. Form and Interpretation. 29 intended to secure that, apart from special agreement, the Sec*. 18, holder should be put, as far as possible, in the same position ''* as if the bill had not been dishonoured-" As the holder is so entitled, should the drawee refuse to accept of the date of the first presentment, the holder would perhaps take it at his peril, for it might be held in the case of a sight bill a quali- fication as to time, see Sec. 19 (2) ; which he may refuse to take, Sec. 44 (i). 19. (i). An acceptance is either (a) general, Jua"nfied\"c'*- or (d) qualified : a general acceptance assents "p'*""*" without qualification to the order of the drawer ; a qualified acceptance in express terms varies the effect of the bill as drawn. (Imperial Act 43 and 46 Vic, Cap. 6r., Sec. ig.) Taking a qualified acceptance discharges prior parties. See post Sec. 44 (2). The holder may refuse to take it, and treat the bill as dishonoured, I/>id (i). (2). In particular, an acceptance is qualified ?ccep which is — {a) Conditional, that is to say, which makes payment by the acceptor dependent on the ful- filment of a condition therein stated ; but an acceptance to pay at a particular specified place is not conditional or qualified. [b) Partial, that is to say, an acceptance to pay part only of the amount for which the bill is drawn ; {c) Qualified as to time ; {(i) The acceptance of some one or more of the drawees, but not of all. Red acceptance. 30 Bills of Exchange Act, 1890. ) ; Sees. 19, 30. i f This section differs very materially from the English Act. The latter retains the law as enacted in i and 2 Geo. IV., Cap. 78, to the effect that an acceptance payable at a partic- ular place is a general acceptance unless expressed to be payable " there only, and not otherwise or elsewhere." This enactment was followed in Canada, as far as Ontario is con- cerned, by 7 William IV., Cap. 5. Sec. i, preserved down to the time that the Act annotated came in force, in R.S.C., Cap. 123, Sec. 16. The bill as originally introduced by the Minister of Jus- tice did not follow its English prototype in this particular, but the words were added in Committee. The Senate, how- ever, amended the section and made it as it now reads. The effect of the amendment is to make it competent for the acceptor to name a place of payment, without restriction, and to make the presentment there necessary in all cases. See/>osf Sec. 52(1) and (2). The law as to promissory notes is now the same. />osf Sec. 86. See Inchoate instruments. Where the acceptor altered the hill by striking out the word " order " after the payee's name, and wrote across its face that it was accepted in favour of him only, it was held the bill was still negotiable by force of Sec. 8 (4) ; that 'Ik v ''^ written across the face were not restricti\ of ts negoti- ability ; and that the acceptance did n< Jie terms of the bill, and was not a qualified but a gt A acceptance.' An acceptance of a bill payableat a Banker ,-, is t ntamount to an order to the banker to pay the bill to the person who, according to the law merchant, is capable of giving a good discharge for it.= 30. (i). Where a simple signature on a blank paper is delivered by the signer in order that it * Decroixf. Meyer, 25 Q.B.D. 343. » Roberts v. Tucker, 16 Q.B. 560 ; Vagliano v. Bank of England 23 Q.B.D. 255. y Form and Interpretation. 31 may be converted into a bill, it operates as a Sec. ao prima facie authority to fill it up as a complete bill for any amount,* using the signature for that of the drawer, or the acceptor, or an indorser ; and, in like manner, when a bill is wanting in any material particular, the person in possession of it has a prima facie authority to fill up the omission in any way he thinks fit. {Imperial Act 4^ and 46 Vic, Cap. 61, Sec. 20.) •"The stamp will cover." — Ibid. This proceeds on the principle that one who signs and authorizes another to fill up the blank, is negligent, and must take the consequence of his negligence. Before the Act came into force, it was held in England, that the acceptor of a bill was liable upon it, where the amount in the body had been left blank and filled in for a larger amount than the figures in the margin, although the latter was the amount for which the acceptor desired to accept it.' Giving a blank bill or note signed is equivalent to giving a letter of credit for an indefinite sum,' and it is presumed to be delivered when originally signed.^ The authority to fill in a payee's name in a blank space was implied in favour of a holder for value before this enact- ment/ The acceptor's death does not revoke the authority to complete the formality of the bill.^ ' Garrard v. Lewis, 10 Q.B.D. 30. » CoUis V. Emmett, i H. Bl. 313 ; La Banque Nationale v. Sparks, 27 C.P. 320; S.C, 2 A.R. 112. 'Clark V. Union Fire Insurance Co., 10 P.R. 313; Snaith v, Mingay.lM. & Sel. 87 ; Lennig v. Ralson, 23 Penn. 137. * Crutchley V. Mann.s Taunt. 529; Bank of Toronto i). Cobourg, 7O.R. I. " Carter v. White, 20 Ch. D. 225 ; affirmed 25 Ch. D. 666. 32 Bills of Exchange Act, 1890. Sees. 20, (2). In order that any such instrument when whelTtibe completed may be enfoiceable against any per- fiiied up. gQj^ ^i^Q became a party thereto prior to its com- pletion, it must be filled up within a reasonable time, and strictly in accordance with the authority given ; reasonable time for this purpose is a question of fact : Provided, that if any such instrument, after completion, is negotiated to a holder in due course, it shall be valid and effectual for all pur- poses in his hands, and he may enforce it as if it had been filled up within a reasonable time, and strictly in accordance with the authority given. As to subsequent holder. lili Where a person indorses a completed note, and hands it back to the maker to discount or make use of it, he holds himself out to the public as bound to every person who shall take the same for value ;' taking it, for a pre-existing debt is giving value ; " even though as merely collateral security therefor.^ Contract not complete until delivery. Exception. 31. (i). Every contract on a bill, whether it is the drawer's, the acceptor's or an indorser's, is incomplete and revocable, until delivery of tlie instrument in order to give effect thereto. Provided, that where an acceptance is written on a bill, and the drawee gives notice to, or according to the directions of, the person entitled ' Montrose v. ClarK, 2 Sand. 115. • Cross J. Currie, 5 A.R. 31. » Canadian Bank of Commerce v. Gurley, 30 C.P. 583. Form and Interpretation. 33 to the bill, that he has accepted it, the acceptance Sec. 21. then becomes complete and irrevocable. {Imperial Act 45 and 46 F/c, Cap. 61, Sec. 21.) This is the notification referred to in Sec. 2 {a). The acceptor might by adopting this course become liable before the delivery of the bill. See Sec. 2 (/). But in case of an indorsement it must be completed by delivery, Sec. 2 (//). It must be delivered fo the indorsee or to . ,e agent of the indorsee. If the indorser delivers the bill ro his own agent he can recover it, if to the agent of the indorsee, he cannot recover it.' (2). As between immediate parties, and as Requisite? regards a remote party, other than a holder in "i*"''^"* due course, the delivery — [a) In order to be effectual must be made either by or under the authority of the party drawing, accepting or indorsing, as the case may be ; {b) May be shown to have been conditional or for a special purpose only, and not for the |)urpose of transferring the property in the bill; But if the bill is in the hands of a holder in wi>en vaiia (Irlivery due course, a valid delivery of the bill by all i"'^""""' parties prior to him, so as to make them liable to him, is conclusively presumed. " Holder in due course ; " see Sec. 29. (3). Where a bill is no longer in the posses- '''''"'' /j"''- sion of a party who has signed it as drawer, ^Ex parte CotO, L R 9 Ch. App. 27. ' 1 34 Bills of Exchange Act, 1890. Sees, 21, acceptor or indorser, a valid and unconditional delivery by him is presumed until the contrary is proved. If it had been stolen there would be no dehvcry, and without delivery, it would p'-esumably not l)e valid in the hands of an innocent holder.' Where title has to be made through a forged indorsement, the holder has no right to sue upon, or retain the bill.- Honest accjuisition confers no title if made through an invalid indorsement.' I i Cipacity of parties. As 10 ( 'irpora- tlDllS. CAPACITY AND AUTHORITY OF PARTIES. Si, (i). Capacity to incur liability as a party to a bill is co-extcnsive with capacity to contract : Provided, that nothing in this section shall enable a corporation to make itself liable as drawer, acceptor or indorser of a bill, unless it is competent to it so to do under the law for the time being in force relating to * suck corporation. {Imperial Act 45 mitl 46 V\c., Cap. 61, Sic. 22.) * "Corporations," Ibid. The proviso to this sub-section \\\\\ have the effect of removing doubt in Provincial Charters which purport to 'Haxendale v. Bennett, 3 n.H.D 515; sn/ liiU In^jham v. C \^ N.S >^2 : Younx v. (Irote. .} HinR 2^^. Primrose, ^Burchfield v. Moore. 3 Iv & B. 083 ; Johnson v. Windle, 3 liing N.C. 225. 'Jenks V. Doran, 5 AH 55S. Capacity and Authority of Parties. 35 give the power, see "The Ontario Joint Stock Companies Sec. 22. Letters Patent Act," R.S.O. Cap. 157, Sec. 59. A corporation incurs no liability by becoming a party to negotiable instruments, unless empowered by its Act of Incorporation to do so.' As to the mode in which corpora- tions may make, indorse or accept bills and notes, see post Sec. 90 (2). Married women have now the same power in Ontario to contract with regard to their separate estate as single women, R.S.O. Cap. 132, Sec. 3 (2). An infant incurs no liability upon a note or bill ; - even though given for necessaries. ' The contracts of lunatics and drunkards are not void but voidable only.-* But complete drunkenness is a defence.' not com- petent. (2). Where a bill is drawn or indorsed by an prawinRor \ ' ' indorsing infant, minor or corporation having no capacity ^yp"^°" or power to incur liability on a bill, the drawing or indorsement entitles the holder to receive payment of the bill, and to enforce it against any other party thereto. The nnker of a note, payable to the order of a person not otherwise inving the capacity to contract, guarantees his capacity to indorse such instrument, and is estopped from denying the latter's power to do so.'' And the knowledge of the indorsee does not [)revL'nt such estoppel applying.' See/rAv/ Sec. 54 (/') and 55 (i) {!>). When the accommoda- tion indorscrs of a cor|K)rati(in, which had no power to make il'eruvian Railways Company v. Thames and Mersey Marine Ins. Co.. L.K. 2 Ch. Ap. 617. "Trueman v. Hurst, i T.R. .)o. ^'Williamson v. Watts, i Cump. 552 ; Swasey v. Vanderheyden, 10 John's R 33. *Molton V. Camroux, 2 Exch. 487 ; Matthews v. Baxter L.R. 8 Ex. 132 ; Robertson v. Kelly, i. O.R. 163. "Gore V. Gibson, 13 M. & W. 623. "Perkins v. Beckett, 2g C.F. 305. ^Ibid., Merchants' Bank v. United Empire Club, 44 U.t'.R. 468. 36 Bills of Excmance Act, 1890. Sees. 22, 23. essential to liability. a note, had been compelled to pay it to the holder, they were held entitled to recover hack the sum paid for it, in an action against siich corporation.' A married woman's contracts were void at Common Law.- But now in Ontario by R S.O. Cap 132, her dis- ability is almost if not entirely removed. But she only contracts with reference to her separate estate, see Sec. 3 (2) of that Act.' 33, No person is liable as drawer, indorser, or acceptor of a bill who has not signed it as such : Provided that — Exceptions. (^a) Where a person signs a bill in a trade or assumed name, he is liable thereon as if he had signed it in his own name ; (d) The signature of the name of a firm is equivalent to the signature by the person so signing of the names of all persons liable as partners in that firm. (Imperial Act 4^ and 46 V\c., Cap. 61, Sec. 2j.) The partners are not liable if the name of the firm i.s varied;^ nor are they if the partner signing is not acting within the scope of his authority.' A judgment again.st one partner on a bill of exchange, ' Brockville & Ottawa K \V. Co v. Canada Central R. VV Co., 41 U C.k 431. " Cannan v. Farmer. 3 K\ Gfj8 "Moore V. Jackson, lO .\ R. 431; Leake v. Duffield, 88 L. T Jour. 45. ♦Williamson 7' Johnson, i H, & C. 146; Faith?'. Richmond, 11 A. & K. 339; Kirk" v Hlurton, 9 M. «& W 284; Royal Canadian Bank v. Wilson, 24 c:.!'. 362 ; Hovey v. Cassels, 30 C.I'. 230; The Canadian Bank of Commerce v. Wilson, 36 II C.R 9. "Federal Bank v. Northwood,7 OR. 389; Royal Canadian Bank V. Wilson, supra ; Odell i' Cormack, 19 O H D. 223 Capacity and Authority of Parties. 37 given hy him alone for the joint debt, is a bar to an action against another on the original contract.' The drawing or accepting of bills is not, in general, neces- sary in farming, mining or professional partnerships, and therefore it has been held that one of the partners in such concerns, has no implied authority to use the name of the firm on a bill or note ; ' even though given for partnership purposes.' And even trading partners have no implied power to use the name of the partnership for the debt of a third person,^ or for their own private debts.' The mere taking of a joint security for a separate debt implies notice to the holder that it was given in bad faith." See Sec. 29. •/54. Subject to tlici provi.sions of this Act, where a sij^nature on a bill is forged or placed thereon without the authority of the person whose signature it purports to be, the forged or unauthorized signature is wholly inoperative, and no right to retain the bill or to give a dis- charge therefor or to enforce payment thereof against any party thereto can be accjuired through or under that signature, unless the party against whom it is sought to retain or enforce payment of the bill is precluded from setting up the forgery or want of authority. {Imf>cr'uil Act 45 niitl 46 F/f., Cap. 61, See. 2j.) An acceptor is precluded from denying the signature of tile drawer, and an indorser, from denying the signature of 'Cambefort v. Chapman, i vious occasions, cashed cheques in the same way ; it was held the bank was protected.- A forged indorsement confers no title,' even in the hands of an innocent holder.^ 'i'here can be no estoppel of a forgery,' but it is otherwise when the indorsement is merely unauthorized. Tho rule laid down is, that ratitication and acquiescence can only be of an act which may be valid in itself and not illegal.' But under this section a party may be precluded by his conduct from denying tiie genuineness of his signature to an inno- cent holder.' Proviso. Provided, that nothing in this section sh.iil affect the ratification of an unauthorized sif^na- ture not amounting to a forgery : (And pro- vided also, that if a cheque, j)ayable to order, is dorsemem ^i\\(\ by the drawee upon a forged indorsement out of the funds of the drawer, or is so paid and charged to his account, the drawer shall have Proviso'- as to pay nipin on foryed in Team v. Filica, 7 M. & G. 513. •'Thoi...l(l ManiifactiirinR Co. r. Imperial Hank, ij OK. <3p; see also Merchants' Bank v. Bostwick, j A, \<. 2^. "Burchfield v. Moore, j K. & 15 O83 ; Johnson 7<. Windle, 3 Hinx N.C. 225. *Jenks ». Doran, 5 A.K 55.S. '■•Brook ji Hook, L.K. G l*-xch. S9 ; Merchants' Bank v Lucas, 15 A.K. 573 •La Banque Jac(jues Cartier v. La Uanque D'MparKne, 13 App. Cas. at p iifS 'Brook V. Hook, L.R. 6 lix. at p. 100. Capacity and Authority of Parties. 39 no right of action against the drawee for the Seca. 24, recovery back of the amount so paid, or no defence to any claim made by the drawee for the amount so paid, as the case may be, unless he gives notice in writing of such forgery to the drawee within one year after he has acquired notice of such forgery ; and in case of failure by the drawer to give such notice within the said period, such cheque shall be held to have been paid in due course as respects every other party thereto or named therein, who has not previously instituted proceedings for the protec- tion of his rights.) The words in brackets are not in the Imperial Act ; nor were they in ours as it passed the House of Commons. They were added in the Senate, and were in a measure a substitute for Sec. 60 of the EngUsh Act. Sec. 60 of that .\cl was an exception to Sec. 24. The effect of the enactment as contained in the proviso is. that until a year after notice, the customer of the bank may object tliat any cheque has l)een paid on a forged indorsement ; after the year he is concluded. .•\s to what is notice is a (juestion of fact, to be decided by a court or jury. It may be cither actual or constructive. .•\s framed originally this clause provided in effect, that the delivery of the checjue or i)ass-book showing its payment, was notice. In many cases doubtless this would still consti- tute constructive notice at least. The difficulty on the part of banks of proving notice, it is apprehended, will prevent the provision from being of much benefit to them. *5. A signature by procuration operates as Procuration notice that the agent has but a limited authority siKnatures. 1 It; I ' 40 Bills of Exchange Act, 1890. Sees. 2s to sign, and the principal is bound by such sig- nature only if the agent in so signing was acting within the actual limits of his authority. {Iiiiptrinl Act ^j and 46 Vic, Cup. 6/, Sn\ Jj.) The person who takes a bill with such a signature ougiit, in order to exercise due caution, to require production of the agent's authority.' The real scope of the authority may be collected from any admissible evidence' If the agent exceeds his authority, he may be personally liable.' If he acts within the scope of it, though fraudulently, the principal is bound.* Person sii;ning ns agent or ir reprt'smta ti c *6, (i). Where a person signs a bill as agemorTn dfawer, indorser or acceptor, and adds words to reprt'smta- ' live capa- i^jg signature indicating that he signs for or on behalf of a principal, or in a representative character, he is not personally liable thereon ; but the mere addition to his signature of words describing him as an agent, or as filling a re- presentative character, does not e.xempt him from personal liability. {Imperial Act 4s and 46 Vic, Cap. 61, Sec. 26.) Thus if A. signs a bill, for "The O. Manufacturing Co., per .\. Secretary," he is not personally liable, but otherwise, if he signs " A. Secretary of the O. Manufacturing Co." In the latter case the words attached to the signature are regarded as mere desif^natio personw. This section is 'Attwood J'. Miinnings, 7 B. &C. 2jH f^ir Hayley ). at p. 283 '^Cooper V. Blacklock, 5 A R 535; Thorokl Manufacturing Co v. Imperial Hank, 13 O.K. 330. "West London Commercial Hank v. Kittson, 12 y H I) isy. ^Molsons Bank v. Brockville, 31 C.I'. 174. Cai'Acitv and Autiiokitv ok Paktiks. 41 merely declaratory of the Common I^aw.' In the debate in Sec. 26. the Senate, see Senate Hansard, 1890, p. 383, Hon. Mr. Al)l)ott, who introduced the bill as it had passed the Com- mons, seems to have thought the construction of this section would be, that a person signing is not liable, if he states for whom he is agent, but would be if he did not, i.e. that the mere addition c.i,'., of the word, " agent," would not exempt him from liability, but it would if he stated for instance, "agent for A.iJ." It is submitted, however, with all defer- ence to so eminent an authority on Commercial 1-aw, that this view is not correct. See Chalmers on liills, p. 70. If a person by implication makes an untrue statement as to his auih(jrity on a negotiable instrument, he is guilty of a constructive fraud, and may be held liable, notwith- standing the provision of this section.* (2). In dotcrininins^ whether a signature on a bill is that of the princip.il or that of the agent by whose hand it is written, the construction most favourai)le to the validity of the instrument shall be adopted. The niaxim " /// res ///dxis' luileaf" governs the con- struction. If might liaj)peM, if the agent was not liable, no one would be. So, where a bill addressed '"To the President .Vlidlaiid Railway " was accepted in these words, " For the Midland Railway of Canada accepted. H. R. secretary, (i. .\. C. President," it was held that (1. \. C. (who was .admitted to i)e the president,) was liable personally, as the bill was not drawn on the Company.' On similar |)rinciples, the terms of an acceptance were construed most strongly against the acceptor.^ Riili.' for 'lutcriiiiin- lion of siKiiatinc >Thomas v. Hishop, 2 Stra. 055 ; na^erty ;'. Stiuier, 42 U.C.R. if)5 ; I'oster 7'. Getldes, 14 IJ.C K. 2 jc) ; Thompson v. Feeley, 41 U C.K 22nsii>euati()n kok a Hill 45 whether, when such holder took the bill, he Sees. a8, knew such party to be an accommodation party or not. This is declaratory, and makes no alteration in the law : except, perhaps, that hereafter the holder's knowledge, that a party to a hill is an accommodation party, will not affect the hitter's liability should circumstances arise which would constitute a defence if he was only a surety ; e.g. if time was LMVcn.' •19, (i). A holder in due course is a holder \|;;!'|,';[J;'. who has taken a bill, complete and regular on the face of it, under the following conditions, namely : — {a) That he became the holder of it before it was overdue and without notice that it had been previously dishonoured, if such was the fact ; {/)) That he took the bill in good faith and for value, and that at the time the bill was negoti- ated to him he had no notice of any defect in the title of the person who negotiated it. (Imperial Act 4^ ami 46 Vic, Cap. 6/, Sec. 2p.) •Sec notes to Sec. 27 {2) ante. The expression, " holder in due course," is introduced by this Act, following the English Act, and it is to be hoped that it will henceforward be of common use. Every holder is prima facie a holder in due course, Sec. 30 (2). (2). In particular, the title of a person who xiiie , ... . 1 r • • I • I • dtfcctive in negotiates a bill is detective within the meaning c»s«?^ " O SDCCItiC speciKetl. 'Smith V, Knox, j Esp. 46: Charles v. Marsden, i Taunt. 224. 46 ILLS OK KX( IIANCiK ACT, 189O. Sec. 29. of this Act when he obtained the hill, or the acceptance ihereof, by fraud, duress or force and fear, or other unlawful means, or for an illegal consideration, or when he negotiates it in breacn of faith, or under such circumstances as amount to a fraud. Tlie words, " in particular," are used to introducf exami)l(.-s of what precedes, and what follows may l)e deemed a statutory illustration. It is not necessarily exhaus- tive and the title to the hill niay be defective, althou^h free from the vices mentioned. 'I"he words, " force and tear," are the e(iuiv,ilent in Scotch law for "duress." 'I'he Imperial Act api)lies to Scotland, and they were introduced for that reason. Where the maker was induced to sign a note to pre- vent a forgery committi'd hy his son becoming public, it was held that tl'.i; p;iyee c(>;ild not recover in an action upon it.' Using the criminal law to get a settlement of a civil cjaim is illegal, and the security thus (tbtained is invalid.' kit;li! of Milisi iHK ni lir.ldrr (3). A holder. wh(;ther for value or not. who derives his title to a bill through a holder in due course, and who is not him.self a parly to any fraud or illegality allccting it, has all the rights of that holder in du(; ( .)urse as reg.irds the acceptor and all parties to tlie bill prior to lh.it holder. \ny holder deriving title from a holder in duo < ourse. is himself a holder in due course, whether he gave value or 'Doyio V. C.irroll, 2H CM'. 21H '^Shon-y 7'. Jones, is S/'.K. ,j')H. Sec K<''i''r:illy .'is to this, Kni.'('sb.'iw r. Collier, 30 C I'. 20^, VV.ntts j'. Mitchell 2(1 ilr. 570, Hell ;•. Kidiiell, .: O.K. 25, S.C lii A l< 5.}.!. As to thre.ils. undue inflnence, etc., see .slie.ard j'. Lnird, 15 .\ K. jjy ; Armstrong : I'.ine, 25 Cr, I. ' TlIK CONSIDKUATION I- OK A HiLL. 47 not ; subject always to the condition, that he has not himself Sees. .■^, been a party to any fraud or illegaUty affecting it. ^°" Under this sub-section it would appear that when the title to the bill is once purged of its infirmity by the bill passing into the hands of a holder in due coirse, it becomes immaterial whetlier any subsecpient holder had notice or not of the prior defect or illegality. .Sec also as to this pos.t Sec. 30 (2). :iO. (1). Every party whose signature ap- j:;,';,'^;;;';';,,,^ pears on a hill x'f, prima facie tleemed to have,',"''!,*!'""' become a parly thereto for value. {Impifuil Alt 7j iiiui ^6 Fie, Cnf^. 61, Sii. jo.) That is, of course, in an aitioii against him. It isincffetl the old rule that coiisidLralion is presumed in the case of negotiable instruimnts. This section could not be invoked by a plain' in favour of himself, whin the onus of proving that he ga\ value lies upon him.' See next sub-section. (2). Aiul c:very holder of a hill \s priii/a /i^'^/'c « >i, wi,„m ' ' ' ' • iiiiiiii II iif deemed to he a holder in due course ; hut it, in i"""f'i"*' an action on a hill, it i^ idmitted or proved that the acceptance, issue or suhs(;(|U('nt negotiation of x\\v h\\\ is airect(.'d with fraud, duress or force and fear, or ill<;gality, the; hiu-den of proof (that he is such holder in tlu(; course shall he on him, unle.ss and until he proves »!ial, subse(|uent to the alleged fr.iud or ilU^galiiy. value has in good faith been given lor the hill by some other holder in due course.) The Imperial ;\ct in th.is sub-section, omits the words in brackets and uvs in lieu thereof, " is shifted unless and 'Smitli V. Martin, <) M. I'v W. .{o.(. i-%. ij M r ' i i i n m"' 4.S Hll.LS OK l'".\( IIANCK Act, 1S90. Sec. 30. until the holder jiroves that .siil)sc(|iicrU to tlie alleged fraud or illegality value has in good faith been given for the bill." 'I'liis sub-section as originally framed began with the word " I'.ut " and the next senteiiees with tin- word " And." The anundnKnls were made in thi' .Senate. The writei submits that llu' sense, as well as till- context, would li.i \h t\ unproved if the sub sei lion liad not been introducid by a conjunction at all. The words with whio/iu J/i/f, or that he derives tiilr from a holder in duf course. See Sec. .'o (,>) and notes thereto. As to what IS good laith, see /m/ Sec. So ; as to who is a holder in due course, see Sec. 20 (1 ). (3). No hill, altli()ii_i;h ^nvcii for a iisuriou.s consideration or upon a iisiirioiis contract, is void in the hands ol a holder, unless such holder li id at the linK! ol its transfer to him actual knowledj^e that it was ori^inall)' j^iven for a usurious consideration, or u|)on a usurious contract. (Not in the Imperial Act.) This was, at the pas.sageof the .Act, the (!unadian Statute Law. .See K. S. ( '. ("a|». 1 .• {, .Si-c. 17. 'I'hcrc is now no restriction \i\ Canada .is to the ule of interest, R.S.C, Cap. 127, Sec. 1. Se( tions (> - 50 mclusivc 'Smith/'. M.irtin, suf'rn . Kailcy r. Itidwt;!!, ij .M \ W. yj, M;irvt;y 7'. Towrrs, (> Isxch. <>5(i. "Tatam v llaslar, n '.). It.I). j.j5. i i '. i: The Considp:ration for a Bill. 49 of that Act are repealed by 53 Vic, Cap. 34. Until the Sec 30. passatje of the latter Act the law was as follows : in Ontario and Quebec, there was no restriction as to the rate of interest, except that certain corporations, other than Banks, could not charge more than six per cent., subject to certain excep- tions. In Nova Scotia seven per cent, might be stipulated for, and in certain cases ten per cent. In New Brunswick six per cent, was the limit. See R.S.C., Cap. 127, Sec. 9 et set/. As to the effect of 53 Vic, Cap. 34, on bills and notes taken before the -Act which would be usurious, see cases cited below.' The rate of interest chargeable by banks is limited to seven per cent, liy "The Bank .\ct,"53 Vic, Cap. 31, Sec. 80. Tlicr is no penalty, however, for charging a higher rate ; but no more than seven per cent, is recoverable. //>/>/. Usury Laws were abolished by C.S.C. 1859, Cap. 58.' See also R.S.C., Cap. 127 as to this. .Mthougl', sine the repeal of the usury laws, the fact of taking a bill at a considerable undervalue, is not of itself sufficient to affect the title of tlic holder, it is an important eleiuoiU in consider-ng 'vhether he acted bona fide. ^ (4). I'- very bill or note the con.sideration ofcomiider .... . . . ationcon which consists, m whole or 1 p. i)art, ot the pur- -•'^''nK "f ' r |iiii( nasi' chase money of a patent right, or of a partial l";;"^i"'' interest, litniteil j^eographically or otherwise, in """'■ a patent right, shall iiave written or printed pro- luiniMitly and legibly across the face thereof, before the .same is i.ssued, the words " given for 'H.ink of Miinlrcal v Scott, 17 CI' <5K , Commrrri.il M.ink r. Cotton. 17 (' .V .!i4, in apiu-.-il, .wj , Commercial li;ink v. Harris, a6 U.C.K. S'I4 'yuinlan v. (lordon, 20 (Jr. apf^ciuUx 1. "Jones t'. 'lonion, i App. Cas. 616; Swaisland j. Davidson, 3 O.K. -lo. f:-» mm r I ■ ' ■" i (!t J » : i u 50 Hll,I,S Ol' KX( IIANCiK A( T, l«90. Sec. 30 a patent rij^ht ;" (and without such words there- on such inslruuHMit antl any rtMiewal thereof shall l)e void, except in the hands of a holder in due course witliout notice of such consid(;ration.) (Not in Inpcrial Act: — l<.S.( !., ( 'ap. 123, Str. 12.) Tlu' words in brackets were added in the Senate. Under this section as it stood Itcfore this amenchnent, it was held that the omission ol the words " |.;iven for a |)alent ri^ht " (hd not .ivoid the note between the inunechate parties to it.' Now, however, their oniission will have that effert. I.UI>illly IIHIIhIi'II'I '' (5). The indorsei; or other transfer«'(! of ;iiiy such instrinnjMit havinj,^ the words afori .said so |)riiitetl or wrill(;n thereon, shall tal<«; the same suhject to any . S.,). TlIK CoNSIDKKATloN lOK A 1?II,I,. 5' 3«- in part, of 'he purchase tnoiu'y of a patent rij^ht, ^"".-so or of a partial intitrest, limited ^eo^raj)hicalIy or otherwise, in a pat<;nl rij^ht, is jj;iiilty (»! a inlscl(Mn<:aii()iir, .mkI Uahie to imprisonment for any term not ex((;(!clinjj^ one year, or to such fme, not ex{M'e(h'nj^ two Innuh'ed dollars, as the <:ourl thinks fit. (Not in Imperial An K.S.C. Cap. 12], Src 1 j.) Siil)-sccli(ins I, 5 and (t of this sct-ti«)n were not in llic original drall (if llic Art, l)Ul wore added in ( 'onmiillcc. NKC.oriA'llON OK IUI,I.S. :n. (1). A hill is nc^roiiaird wIkmi it is trans- n;«;;,\'''''''' ferred lr.>m one pers»)n to aiKillur in such a man- ner as to constitute the traiisreree the holder ol the Im II. {hnf^fiid! Ait /j itiul /6 !'/<., Cnf\ 61, Sec. ^1.) Scf " holder " delined See. _• (\^). A man, who has nu inlere:.! in the lull, nui possession of it, liul lends his name lot the plir|)(ise ot Miiiigun il, is not the holde'.' Where the piaiiitili :. nanw was used, without his knowledge or assint, lii'. suli . V.iinli-i li|> c. SliiUll. .' CI'. <"i. 'Miepley r. Iliinl. tA.K. ,)■». Small c. Kidilrll, |i CIV \'j \. Khi i 52 HlM.S nl |'",X( IIAN*;!-; A< T, iSf/). Sec. 31. Sec See. 2 for (It-rinition (»f " licarcr " and " delivery." T'l fjiilii (3). A l»ill |);iy;il>Ir to auU'.r is n('j^()ti.il<*lrl('y (Irlivcry. Sec Sec. i {//), f'»i flcfmihcm «)f " iiuhtrscincnl " ; and S«'c. ■^2, />(n/, as \ft what (ondilions must l)c coin|ili<'d willi. An affc|ilanrc may \n- (-oniplctcd l»y delivery or no/i/irti/iofi. Sec. 2 (»/). There is Mfi similar provision as lo indorsemenls. A (or^;ed indorsement, apart from oilier provisions, would pass nothing, even under this section, as it is not l»y the holder. Sec .Sec. 24. Witli'MII mi'ir m' trirnl (,}). Wlnrc llu' lioidcr of" a l>ill payable to his ordrr transfers it for value without indorsing it, tlnr transfer j^ives the transfere*- sik h titl«- as tlu; lrausferr<'r had in iIk- hill, and th*' transferee in addition acrpiin's the ri^dit to ii.ive the in- dorsentent of the transferrer. Until the lull is indorsed, the tr.insferce is a(Te< t<'d liy any C'luities wlm h attac h to it in the hanrls of he. trans ferrer,' nor is his defe Iran. lei, \^lieii it was inleiided lh;i! it siiuiii'l lie, the pailv may he < (impelled 'VVJilslIci ,.. I nislrt. I I C.II.N.S. /,(«. "Itiuiiin V. <.,iiM«T, I II tV N. (H/ , I'lirdlMiii c, Miirr;ty. i| A.R. I'".. ' I l.ii i(i|i J'. I'ImIht, I'iC.II.N.S. i<)fi. NKdOTIATION Ol' lill,l,S. 5.? Ity a ('oiirl of iMjiiity to maki- tlu- indorst'iiu'iU ; and, if ho Sec. 31. nftcrwarils Immoiiu's liaiikriipt, that will not vary iiis right or duty to make it ; anti if he should i>«h..- ^•'' f ' " ImIiIv in.iv imiorsc .1 l)ill in a rcprrsrni.iiivc capacity, In- '" """'"'• may iiulorsr a Itill in mk h Icnn.s as to urinative persona] liahilily. See .Sec. i^ \i) .ind Sec. 2(> lor oilier provisions as to ncg.itiving hahihly. 'This section will prohahly he held not to apply lt» cases ol .!jren«y at all, hut exclusively to cases in which the person signing ai Is in a re|trescntalivc capaiity, as executor, 01 tills an ottii e, as where a hill is made payahle ic) the Older n\ the Ireasurcr of a Mniiicipahly. In such insiaiH .'s siiilaltle words added alter his signaliire, r ji;., " with oiii personal hahilily," will he effectual to negative personal ii.ihihty 'i'his provision is t(^ milignte the rigour of the 'Sliirv Mil IIIIIh, Spi , int. ! ' I I ■ Ml 'V 54 Hills ov Kxchanck Act, 1890. Sees. 31, principle laid down in Sec. 26, where persons are under 3*' obligation to indorse bills or notes in their representative capacity, and should, it is submitted, receive a most liberal construction in the courts. ReqiiiftiU'S of a valiil indorse- tni'iil. 3a. (i). An indorsement in order to operate as a negotiation must comply with the following conditions, namely : — (fl) It must be written on the bill itself and be signed by the indorser. The simple sig- nature of the indorser on the bill, without ad- ditional words, is sufficient ; An indorsement written on an allonge, or on a " copy " of a bill issued or negotiated in a country where " copies " are recognized, is deemed to be written on the bill itself ; (d) It must be an indorsement of the entire bill. A partial indorsement, that is to say, an indorsement which purports to transfer to the indorsee a part only of the amount payable, or which purports to transfer the bill to two or more indorsees severally, does not operate as a negotiation of the bill ; (r) Where a bill is j)ayable to the order of two or more payees or indorsees who are not partners, all must indorse, unless the one in- dorsing has authority to indorse for the others. {Imperial Act 45 and 46 K/c, Oip. 61, Sec. j2.) An "allonge" is a slip of paper attached to the bill, called in French an " aUou^e." It is not essential that there should be a physical impossibility of writing on the bill NiXlOTIATlON OF BiLLS. 55 itself, but it may be resorted to as the necessity or the con- Sec. 3a. venience of the parties requires.' The allonge should be firmly affixed to the bill. Courts will be slow to admit indorsements on papers otherwise attached and easily removed from one bill to another. Some codes contain minute provisions upon the subject, to prevent frauds. As an indorsement mtist be of the entire bill ; it follows that if a bill be payable by instalments, an indorsement of one or more only of the instalments will not operate as a negotiation of the bill pro tonto. It would however be authority to the holder to receive the specified sum, Sec. 27 (3)- As to the power of parties not sui Juris to indorse, see Sec. 25(2). ^Vhcre an indorser was insolvent, and his estate had vested in his assignee, it was held that his indorsement conferred no title.' (2). Where, in a bill payable to order, the MisspeiiinR. payee or indorsee is wrongly de.signated, or his name is misspelt, he may indorse the bill as therein described, adding his proper signature; (or he may indorse by his own proper signature.) The words in brarkcts arc not in the Imperial Act. The usual practice is to require him first to indorse the bill as therein described, afterwards adding his proper signature. Now either mode alone will be proper, but doubtless, the practice of indorsing in both modes, will be found to be the most convenient and expedient. Where the bill is payable to the order of a married woman thus, " Mrs. John Campbell," the proper mode of indorsement appears to be " Mary Campbell, wife of John Campbell." 'Crosby 7'. Roiib, ifi Wisconsin fnO. 'jenks V, Dor.in, 5 A.K. 558. m mm- Sec. 33. n Special in- doraemeni. 56 Hills ok Kxcmancjk Act, 1890. Order of in- dorsement. When an action on a note payable to " J . S. & Son " was brought in the name of "J. S. & Co.," it being clear that the plaintifTs were the persons designated us payees, they were held entitled to recover.' (3). Where there are two or more indorse- ments on a bill, each indorsement is deemed to have been made in the order in which it appears on the bill, until the contrary is proved. And their liability will be in that order. In the case of accommodation indorsers, it was formerly held in the courts of Ontario that they, like other co-sureties, were liable to mutual contribution ;' but it is now finally established, that they are, in the absence of any agreement to the contrary, to be considered as having entered into a contract of surety- ship, in the terms which the bill or note and the indorse- ments are known to create.' But this agreement is easily implied ; as for instance, where the directors of an incor- porated company agreed by resolution to raise money on an accommodation note, to be made by the company and in- dorsed by them, it was held that the order of liability was not to be ascertained by the position of their signatures on the note, but that they were, infer se, co-sureties.* (4). An indorsement may be made in blank or special. It may also contain terms making it restrictive. A restrictive indorsement is defined Sec. 35 (1). 'Wallaces. Souther, i6 SCR. 717. 'Mitchell V. English, 17 Gr 303 : McKelvey v Davis, lb. 355 ; Cockburn v. Johnston, 15 Gr 577 ; Ciipperton v. SpettiKue, 15 Gr. 269. •lanson v, Paxton, 23 C V 439. ♦Macdonald v. Whitfield, 8 App. Cas. 733 ; see Fisken ?> Meehan, 40 U.C.R 146. Negotiation of Bills. 57 88. Where a bill purports to be indorsed S«c«. 33, conditionally, the condition may be disregarded c.,„^onai by the payer, and payment to the indorsee is '"''"""• valid, whether the condition has been fulfilled or not. nient. {Imperial Act 43 and 46 Vic, Cap. 6/, Sec. jj.) This is an alteration of the law. Before this enactment the condition was binding on the acceptor and he was not discharged if he paid the bill before the condition was satis- fied.' Observe that the word used in this section is " payer." *' Payer " and " payee " being correlative terms, payer might be held to mean the party primarily liai)le to pay, and caution therefore is still recjuired on the part of all others. 34. (i). An indorsement in blank specifies no '"'Iomc- indorsee, and a bill so indorsed becomes payable '''"'' to bearer : (2). A special indorsement specifies the per- sp.cui in son to whom, or to whose order, the bill is to be payable : (3). The provisions of this Act relatinji; to a Anpiication payee apply, with the necessary modihcations, d^rsoe. to an indorsee under a special indorsement. {^Imperial Act 45 and 46 Vic, Cap. 61, Sec. J4.) As to these provisions, see sections 7 and 8. Some of these are, in brief, that he must be indicated with reas- onable certainty ; that the payees may be joint, or in the alternative ; that the payee may be the holder of an office for the time being ; that if fictitious or non-existing the bill may be treated as payable to bearer ; and that it may be * Robertson v. Kensington, 4 Taunt. 30. IS . 1 '2;' M i. '^ \t ^ IMAGE EVALUATION TEST TARGET (MT-3) 1.0 I.I 11.25 ^ iiii 122 Z Ufi 12.0 |U 11.6 t« — <^ 5r 4^^> .^""^ Photographic Sciences Corporation 23 VMBT MAIN STRIIT WIUTIR.N.Y. 14910 (716) •73-4903 X IS 58 Bills of Exchange Act, 1890. Sees. 34, payable to order or bearer, and that the omission of these ^ words does not restrain the negotiability. Conversion (a). Whcrc a bill Has been indorsed in blank, of blank in- \~' i • i dorsement. ^j^y holdcr Hiay convcrt the blank indorsement into a special indorsement by writing above the indorser's signature a direction to pay the bill to or to the order of, himself or some other pC^'Jif '. This v-as the law before the Act,' and the almost uni- versal ■- ia':l:ce of banks. A party primarily liable, other than the acceptor, paying a bill may strike out the restrictive in- dorsements.' I I Restrictive indorse- ment. Right of indorsee thereunder 3*S. (i). An indorsement is restrictive which prohibits the further negotiation of the bill, or which expresses that it is a mere authority to deal with the bill as thereby directed, and not a transfer of the ownership thereof, as, for ex- ample, if a bill is indorsed " Pay D only," or " Pay D for the account of X," or " Pay D, or order, for collection." {Imperial Act 43 and 46 Vic, Cap. 61, Sec. jj.) From the examples given in this sub-section, read in the light of section 34 (3) and section 8 (4), it is clear that the omission of the words " or order " after the indorsee's name does not make an indorsement restrictive. (2). A restrictive indorsement gives the in- ■ dorsee the right to receive payment of the bill and to sue any party thereto that his indorser iClark V. Piggott, i Salk. 126; Hirschfield v. Smith, L.R. i C.P. 340 at p. 353. "Black V. Strickland, 3 OR. 217 ; see also post Sec, 59 (2) (6), Negotiation of Bills. 59 could have sued, but gives him no power toSecs.3S» transfer his rights as indorsee unless it expressly authorizes him to do so. The restrictive indorsement is not a condition which can be disregarded by the payee, under Sec. 33, unless, it is sub- mitted, it is only conditionally restrictive. (i). Where a restrictive indorsement author- ufunher ' ' transfer is izes further transfer, all subsequent indorsees a^'^orized. take the bill with the same rights and subject to the same liabilities as the first indorsee under the restrictive indorsement. This might happen when the indorsement was in the form of the second or third examples given in the first sub section, viz., " Pay D for the account of X," or " Pay D, or order, for collection." The subsequent indorsees are mere agents and not holders in due course. Sec. 29, and therefore any defence available against the first restrictive indorsee is available against them. 36. ( I ). Where a bill is negotiable in its jy^f^^mr' origin, it continues to be negotiable until it has lfll^° been (a) restrictively indorsed, or [d) discharged by payment or otherwise. (Imperial Act 43 and 46 Vic, Cap. 6/, Sec. j6.) Striking out the words " or order " after the payee's name does not restrict the negotiability.' A bill is only discharged by payment when made in due course by or on behalf of the drawee or acceptor. Sec. 59 (i). It is not discharged by payment by the drawer or indorser, /did. (2), unlf":j he is a party accommodated, /did. (3). 'Decroix v. Meyer, 25 Q.B.D. 343. 6o Bills of Exchange Act, 1890. Sec 36. It may be discharged otherwise than by payment ; if the acceptor becomes the holder at or after maturity, Sec. 60 ; by a renunciation by the holder in writing, but this does not affect a holder in due course without notice thereof. Sec. 61 ; by intentional cancellation apparent on the bill, Sec. 62 ; by alteration, saving the rights of a holder in due course where it is not apparent. Sec. 63. Negotiation of overdue bill. il ! !i 1! When bill deemed overdue. (2). Where an overdue bill is negotiated, it can be negotiated only subject to any defect of title affecting it at its maturity, and thence- forward no person who takes it can acquire or give a better title than that which had the per- son from whom he took it. Where there has been an agreement for a set off, such agreement will not be defeated by the transfer of the bill overdue.' It is/w tanto payment.' See Sec. 29 (2), as to defects in title. It will be observed on reference thereto, that want of consideration is not one of the defects mentioned. The absence of consideration will not, in all probability, be deemed an equity attaching to an overdue bill. See Sec. 28 (2), which makes an accom- modation party liable to a holder for value ; value maybe given at any time, Sec. 27 (2) ; and distinguish between a holder for value, and a holder in due course ; the latter only, being defined as one who becomes the holder of a bill before its maturity,^ Sec. 29. (3). A bill payable on demand is deemed to be overdue within the meaning and for the pur- poses of this section, when it appears on the 'Ching V. Jeffrey, 12 A.R. 432. 'Quids V. Harrison, 10 Exch. %^2. ^Charles v. Marsden, i Taunt. 224 ; Sturtevant v. Ford, 4 M. & Gr. loi ; Cowan v. Doolittle, 46 U.C.R. 398. Negotiation of Bills. 6i face of it to have been in circulation for an Sec. 36. unreasonable length of time ; what is an unrea- sonable length of time for this purpose is a question of fact. This is a new provision. Jt is expressly Jimited to the purposes of this section, and will have no further or other operation than to fix the time when the holder, as the holder of an overdue bill, will be affected with defects of title, of which he had no notice. A different rule is laid down post Sec. 85 (3) with regard to notes payable on demand. As hitherto, for the purposes of the Statute of Limita- tions, a bill payable on demand will be deemed due imme- diately and the time will run from its date against the acceptor.' The rule however would probably be different in the case of the drawer and indorsers. In the latter case, it is conceived, t^ 3 Statute will not run from the date, but from the demand, by force of Sec. 47 (2). W. Except where an indorsement bears date Presump- '■ tion as to after the maturity of the bill, every negotiation negotiation. is prima facie deemed to have been effected before the bill was overdue. This was the law before the enactment." (5). Where a bill which is not overdue hasTakingwii ^ ' , , . subsequent been dishonoured, any person who takes it with {jo^^u, notice of the dishonour takes it subject to any defect of title attaching thereto at the time of dishonour ; but nothing in this sub-section shall affect the rights of a holder in due course. 'Megginson v. Harper, 2 C. & M. 322; Norton v. Ellam, 2 M. & W. 461. "Parkin v. Moore, 7 C. & P. 408 ; Roberts v. Bethell, 12 C.B. 778 ; Lewis V. Parker, 4 A. & E. 838. ■\ 62 Bills of Exchange Act, 1890. Sees. 36, 37- The dishonour spoken of will usually be for non-acceptance, in the case of a bill payable after date. This sub-section settles the law as laid down in decided cases.' If the indorsee has no notice of dishonour, he is not in the position of a holder who acquires an overdue bill.^ Negotiation of bill to thereon. 37. Where a bill is negotiated back to the r^eYdyfiabie drawer, or to a prior indorser, or to the acceptor, such party may, subject to the provisions of this Act, re-issue and further negotiate the bill, but he is not entitled to enforce the pa ment of the bill against any intervening party to whom he was previously liable. (Imperial Act 4J and 46 Fee, Cap. 61, Sec. j/.) If the acceptor becomes the holder at, or after maturity, the bill is discharged, post Sec. 60. Holders in due course will not be affected by this section unless they have notice that the bill has been re-issued, see Sec. 36. The possession of a bill, by the indorser after he has specially indorsed it, v&prima facie evidence that he is the owner of it, and that it has been returned to him and taken up in due course upon its dishonour, although there be no re-indorsement, so that by the possession he is remitted to his original rights.^ " Subject to the provisions of this Act." See Sec. 36 (i). Rights of the holder. 38. The rights and powers of the holder of a bill are as follows : — {a) He may sue on the bill in his own name ; {J}) Where he is a holder in due course, he holds the bill free from any defect of title of ^Crossley v. Ham, 13 East49S. aO'Keefe v. Dunn, 6 Taunt. 305 ; S.C. 5 M. & S. 282. »Black V. Strickland, 3 O.R. 217. Negotiation of Bills. 63 prior parties, as well as from mere personal Sec. 38. defences available to prior parties among them- selves, and may enforce payment against all parties liable on the bill : {c) Where his title is defective, (i) if he negotiates the bill to a holder in due course, that holder obtains a good and complete title to the bill, and (2) if he obtains payment of the bill the person who pays him in due course gets a valid discharge for the bill. {Imperial Act 4.J and 46 Vic, Cap. 61, Sec. 38.) As to what is payment in due course, seeposf Sec. 59 (i). " There is at present no decided case that a person hon- estly paying a bill is in as good a situation as a party hon- estly discounting it." ' " Payment before the bill or note is due or long after it is due, or in case of a cheque, long after it is drawn, are examples of payment out of the usual course of business." ' " The question as to the validity of a pay- ment usually arises between a customer and his banker, but a banker paying a bill made payable at his bank must exercise due caution." ^ " There are some cases in which payment to a wrongful holder is protected, and others in which it is not. If a bill or note, payable to bearer, either originally made so, or become so by an indorsement in blank, be lost or stolen, a bona fide holder may compel payment. Not only is the pay- ment to a bona fide holder protected, but payment to the ^See however the observations of Best C. J. in Snow v. Peacock, 2 C. & P. 221 ; of Parke B., in Roberts v. Tucker, i6 Q.B. 560, at p. 575 ; and Ld. Cairns, in Smith v. Union Bank of London, i Q.B.D, 33. at p. 34. "Beltz V. Molsons Bank, 40 U.C.R. 253. "Vagliano v. Bank of England, 22 Q.B.D. 103 ; 23 Q.B.D. 243 C.A. ; Beltz v. Molsons Bank, 40 U.C.R. 253 ; Roberts v. Tucker, 16 Q.B. 560; Agricultural Ins. Co. v. Federal Bank, 45 U.C.R, 214; S.C., 6 A.R. 192 ; Ryan v. Bank of Montreal, 14 A.R. 533. .5T •HI 64 Bills of Exchange Act, 1890. :'. 'i f i Sees. 38, thief or finder himself will discharge the maker or acceptor, 39* provided such payment were not made with knowledge or suspicion of the infirmity of the holder's title, or under cir- cumstances which might reasonably awaken the suspicions of a prudent man.'" "The loser should immediately give notice of the loss to the parties liable on the bill ; for they will thereby be pre- vented from taking it up without due inquiry. Public adver- tisement of the loss should also be given ; for if .any person whosoever discounts it with notice of the loss, that will be such strong evidence of fraud that he can acquire no pro- perty in it. But public notice is of itself neither on the one hand sulificient nor on the other indispensable. To operate at all it must be brought home to the party to be affected by it."" GENERAL DUTIES OF THE HOLDER. 39. ( I ). Where a bill is payable (at sight or) acceptance' aftcr sight, presentment for acceptance is neces- is necessary. o ' i i sary in order to fix the maturity of the instru- ment. When prC' sentmentfor {Imperial Act 45 and 46 Vic, Cap. 61, Sec. jp.) The words in brackets are not in the Imperial Act. It is always a prudent course to present for acceptance a bill pay- able after date, but it is not incumbent on the holder to do so. This was the law before the Act.^ " After sight " on a bill means after acceptance.* 'Byles on Bills, p. 295. 'Byles on Bills, p. 394, •Byleson Bills, 6 Am. £d. p. 179; Walker v. Stetson, 19 Ohio 400. ♦Campbell v. French, 6 T.R. 212. General Duties of the Holder. 65 (2). Where a bill expressly stipulates that it Sec. 39. shall be presented for acceptance, or where a f.^PuTatlon bill is drawn payable elsewhere than at the resi- senuifem. dence or place of business of the drawee, it must be presented for acceptance befoie it can be presented for payment. This latter provision applies to bills payable after date. Observe the expression is not payable at another place but " payable elsewhere than at the residence or place of busi- ness." If drawn payable at a bank, or at the residence or place of business of a third person, it would have to be presented for acceptance, notwithstanding that the bank was in the same town with the residence or place of business of the drawee. (3). In no other case is presentment for ac- no presem- ment in any ceptance necessary m order to render liable any °«her case. party to the bill. Bills payable after date need not be presented for accept- ance. This sub-section is declaratory of the law as it was before the Act.' (4). Where the holder of a bill, drawn pay- Necessary ^^^ . delay for able elsewhere than at the place of business or !J[|nt."'" residence of the drawee, has not time, with the exercise of reasonable diligence, to present the bill for acceptance before presenting it for pay- ment on the day that it falls due, the delay caused by presenting the bill for acceptance *Byleson Bills, 6 Am. Ed. p. 179. 1 Mil 1 Wm 1 1 il 1 \m i 66 Bills ok Exchange Act, 1890. Sees. 39, before presenting it for payment is excused, and does not discharge the drawer and indorsers. •'! This sub-section is new ; and although designed chiefly to meet the case of foreign bills, it will be useful generally in the case of bills from a distance, or bills delayed in course of post, where the place of business or residence of the drawee, is either not in the same town or is considerably removed from the place where the bill is payable. It can only apply to bills payable after date, which must be presented for acceptance, if payable elsewhere than at the residence or place of busmess of the drawee. See ante sub-section (2). 40. (i). Subject to the provisions of this Act, aftlrTigiu.'' ^vhen a bill payable after sight is negotiated, the holder must either present it for acceptance or negotiate it within a reasonable time ; (2). If he does not do so, the drawer and all indorsers prior to that holder are discharged. {Imperial Act 4j and 46 Vic, Cap. 6r, Sec. 40.) " Sul)ject to the provisions," i.e., where presentment for acceptance is excused. See Sec. 41 (2). l?ills payable on demand must be presented for payment within a reasonable time. Sec. 45 (2) (/'). The same rule applies to cheques, Sec. 73(2). There is no separate provision in our Act as to bills pay- able " at sight." Under the English Act they are demand bills. It is conceived thai the provisions of this section would apply to them. Usually the context in our Act has been altered to meet the case of bills payable " at sight " by introducing the words "at sight or" before "after sight." See Sec. 14 (3), Iln'J (4), Sec. 39 (i). Time for presenting bill afte If not pre- sented. As to reason- able time. (3). In determining what is a reasonable time within the meaning of this section, regard shall General Duties of the Holder. 67 be had to the nature of the bill, the usage of Sees. 40, trade with respect to similar bills, and the facts of the particular case. Reasonable time is a question for a Court or jury, having regard to the nature of the bill, the usage of trade and the facts of the particular case. See similar provisions, Sec. 45 (2) and Sec. 85 (2). What is reasonable time, is a mixed question of law and of fact, and no definite rule can be laid down." See also Sec. 36 (3) where " an unreasonable length of time " is made a question of fact. 41. ( I ). A bill is duly presented for acceptance Rules as to \ ' . * _ *■ present- which is presented in accordance with the fol- ^^'^'J^^'^^^ ^*=" lowing rules: (rti) The presentment must be made by or on behalf of the holder to the drawee or to some person authorized to accept or refuse acceptance on his behalf, at a reasonable hour on a business day and before the bill is overdue. {Imperial Act 43 and 46 Vic, Cap. 61, Sec. 41.) "A reasonable hour." Banking hours are from 10 a.m. till 3 p.m., except on Saturdays, when banks usually close at I p.m. If the bill is not drawn on a bank, the holder is not limited to mere banking hours. Ordinary business hours are more extended.-' As to what are business days, see Sees. 14 and 91. When the bill is presented the drawee may demand two days thereafter to deliberate whether he will accept or not. Sec. 42. (^) Where a bill is addressed to two or more drawees, who are not partners, presentment must »Tindal v. Brown i T.R. 168. ''Parker v. Gordon, 7 East 385 ; Wilkins v. Jadis, 2 B. & Ad. 18S. M 68 Bills of Exchange Act, 1890. Sec. 41. be made to them all, unless one has authority to accept for all, when presentment may be made to him only. An acceptance by only one, or some of them is a qualified one. See ante Sec. 19 (2) {d). If not authorized or sub- sequently assented to, it discharges the prior parties. See post Sec. 44 (2). If only accepted by one or some of the drawees, the holder may treat the bill as dishonoured by non-acceptance, see Sec. 44 (i). [c) Where the drawee is dead, presentment may be made to his personal representative. This sub-section is enabling only. When the personal representative is known, presentment may be made to him. If he is not known or if there is no personal representative, or if for any other reason, the holder chooses, he may avail him- self of the option of sub-section 2 {a). [a) Where authorized by agreement or usage, a presentment through the post-office is sufficient. There is no such authorized usage, as far as the writer is aware, in Canada. See post Sec. 45 (7) which makes pro- vision for presentment for payment at a post-office. There is an additional sub-section in the Imperial Act providing for the case of the bankruptcy of the drawee. Excuses for non-pre- sentment. (2). Presentment in accordance with these rules is excused, and a bill may be treated as dishonoured by non-acceptance — {a) Where the drawee is dead or bankrupt, or is a fictitious person or a person not having capacity to contract by bill ; (b) Where, after the exercise of reasonable diligence, such presentment cannot be effected ; General Duties of the Holder. 69 (c) Where, although the presentment has been Sect. 41, irregular, acceptance has been refused on some other ground. The word '* bankrupt " has been retained here, probably by inadvertence, in the transcript from the Engh.>!i Act. See also Sec. 51 {$), />osf, where it is likewise retained. Asa rule the word has been scrupulously eliminated from the Act; notably in Sec. 2 — the interpretation ' lause — where, in tbc English Act, " bankrupt," " includes an\ person whose estate is vested in a trustee or assignee under the law for the time being in force relating to bankruptcy." There is no Insolvent Act in force in the Dominion. A bankrupt is usually one who has been adjudged insolvent or bankrupt under a Bankrupt Law." Clause (a) would, however, pro- bably be held applicable to Banks, Insurance Companies, lUiilding Societies and Trading Corporations in liquidation under "The Winding-Up Act," R.S.C., Cap. 129. (3). The fact that the holder has reason to y^^^^^'J^^H believe that the bill, on presentment, will be dishonoured does not excuse presentment. This was the law before the passage of the Act.'' See Sec. 46 (2) (a) as to presentment for payment and cases there cited. 42. When a bill is duly presented for accept- ^n°e*"^P'" ance and is not accepted (on the day of present- ment or within two days thereafter), the person presenting it must treat it as dishonoured by non-acceptance ; if he does not, the holder shall lose his right of recourse against the drawer and indorsers. ' Temple v. Toronto Stock Exchange, 8 O.R. 705, per Cameron C. J. , at p. 7^1 ; B.N. A. Act, Sec. 91 (21) ; Clarkson V.Ontario Bank, 15 A.R. 166. ''In re Agra Bank, Ex parte Tondeur, L.R. 5 Eq. 160 p. 165. ' it? 1 = ^i Sees. 42, 43. 70 Bills of Exchange /.ct, 1890. {Imperial Act 4s and 46 Vic, Cap. 61, Sec. 42.) In the Imperial Act the words "within the customary time " are used instead of those contained in brackets and the same words were used in the original draft of our Act. As the bill passed the Commons, with the view to secure uniformity in the different provinces, these words in the Imperial Act were struck out, and "or on the next following day not being a legal holiday or non-juridical day," substi- tuted for them. The Senate amended the section so as to read as it now stands. In the computation of time non- business days are to be excluded, Sec. 91. The holder will be justified in leaving the bill with the drawee for the period mentioned." Should the bill be improperly detained, see Sec. 51 (8) as to mode of protest. Dishonour 43, ( I ). A bill is dishonoured by non-accept- by noil- \ ' 'I acceptance ot-irP and its con- ""^-^ sequences. {a) When it is duly presented for acceptance, and such an acceptance as is prescribed by this Act is refused or cannot be obtained ; or — [b) When presentment for acceptance is ex- cused and the bill is not accepted. {Imperial Act 45 and 46 Vic, Cap. 61, Sec 4J.) See Sec. 41 (i) and (2), providing as to what is a due presentment for acceptance or excuse for non-presentment. The requisites of an acceptance are prescribed in the Act at Sees. 17, 18 and 19 ante. Recourse in such case. (2). Subject to the provisions of this Act, when a bill is dishonoured by non-acceptance an immediate right of recourse against the drawer ^Byles on Bills, 209; Bank of Vandieman's Land v. Bank of Victoria, L.R. 3 P.C. 526 pp. 542, 543. General Duties of the Holder. 71 and indorsers accrues to the holder, and no pre- Sees. 43, sentment tor payment is necessary. The provisions referred to, are those contained in Sees. 64 ef seq. relating to acceptance and payment for honour. 44. ( I ). The holder of a bill may refuse to as to quaii- .. . . ''^'d accept- take a qualified acceptance, and if he does not ^""^• obtain an unqualified acceptance may treat the bill as dishonoured by non-acceptance. {Imperial Act 45 and 46 Vic, Cap. 61, Sec. 44.) If he takes a quahfied acceptance without the authority, express or implied, or subsequent assent of the drawer or an indorser, such drawer or indorser is discharged, see next sub- section. (2). Where a qualified acceptance is taken, \l-^^ and the drawer or an indorser has not expressly ''"'^""'y- or impliedly authorized the holder to take a qualified acceptance, or does not subsequently assent thereto, such drawer or indorser is dis- charged from his liability on the bill ; The provisions of this sub-section do not p-^niai *^ _ _ acceptance. apply to a partial acceptance, whereof due notice has been given ; where a foreign bill has been accepted as to part, it must be protested as to the balance. This sub section is new. Acceptances wheri ciualified arc — (a) Conditional ; {/>) Partial; (c) Qualified as to time ; {d) Qualified as to parties. See Sec. 19, ante. I n hit •■' ft ,;i. I ■ B Hi ' Sees. 44, 45- What shall be deemed assent. Present- ment for payment. 72 Bills of Exchange Act, 1890. Partial acceptances are excepted from the rule. Where a partial acceptance is taken, notice should be given, but not notice of dishonour,' and in the case of a foreign bill there must also be a protest. (3). When the drawer or indorser of a bill receives notice of a qualified acceptance, and does not within a reasonable time express his dissent to the nolder, he shall be deemed to have assented thereto. Also new. In England, before the passage of i and 2 Geo. IV., Cap. 78 (the equivalent of R.S.C., Cap. 123, Sec. 16,) an acceptance payable at a particular place was a quali- fied acceptance. In such case it was the holder's duty to give notice to the drawer and any prior indorsers." 45. (i). Subject to the provisions of this Act, a bill mu.st be duly presented for payment ; if it is not so presented, the drawer and indorsers shall be discharged. {Imperial Act 43 and 46 Vic, Cap. 61, Sec. 43.) " Subject to the provisions of this Act ;" see Sec. 46. This Act makes a radical change with regard to present- ment for payment as we have already seen.' Formerly it was not necessary in Ontario to present a bill or note for payment, to charge the acceptor or maker, unless expressed to be made payable at a particular place "only, and not otherwise or elsewhere," R.S.C., Cap. 123, Sec. 16. See now, however. Sec. 19 as to bills, and Sec. 86 as to notes. The English Act retained the provisions as to bills in Sec. 19, but abolished it in the case of notes. See Sec. 87 •Bentinck v. Dorrien, 6 East 199. "Rowe V. Young, 2 B. & B. 1G5, at pp. 174, 175. "See Sec. 19, and notes thereto, at p. 30, ante. General Dutip:s of the Holder. 73 ment. of that Act. The section annotated is framed in harmony Sec. 45. with the provisions of the English Act. It can scarcely be said to be so with ours. It implies that the only penalty for non-presentment is the discharge of the drawer and in- dorsers. By Sees. 52 (2) and 86 (i) of our Act there is the further penalty, that the plaintiff in an action against the acceptor or maker may be mulcted in costs, if it has not been so presented. Presentment for payment in Canada therefore for practical purposes may be said to be always necessary,unless in cases where it is excused under Sec. 46 (2). {2). A bill is duly presented for payment p"esem- '° which is presented in accordance with the fol- lowing rules : — (a) Where the bill is not payable on demand, presentment must be made on the day it falls due. To bind the drawer or indorsers. Omission to do so on the day of maturity does not discharge the acceptor, Sec. 52 (2) ; nor the maker in the case of a note, Sec. 86 (i) ; unless in the case of the former there is an express stipulation to that effect either in the bill or the acceptance, Sec. 52 (2). (d) Where the bill is payable on demand, then, subject to the provisions of this Act, pre- sentment must be made within a reasonable time after its issue, in order to render the drawer liable, and within a reasonable time after its in- dorsement, in order to render the indorser liable ; In determining what is a reasonable time, regard shall be had to the nature of the bill, the usage of trade with regard to similar bills, and the facts of the particular case. By Sec. 10 bills overdue, when negotiated, are to be deemed payable on demand, and this provision would then seem to be f I 74 Bills of Exchange Act, 1890. Sec. 45. applicable to them. As to when bills payable on demand are to be deemed overdue, see Sec. 36 (3). They are not deemed to be so merely because they bear date some time back.' (c) Presentment must be made by the holder or by some person authorized to receive pay- ment on his behalf, at the proper place, as here- inafter defined, either to the person designated by the bill as payer (or to his representative) or some person authorized to pay or refuse payment on his behalf, if, with the exercise of reasonable diligence, such person can there be found. After "liehalf" in the second line in the Imperial Act the words " at a reasonable hour on a business day " are in- serted. The words in brackets are not in that Act. As a rule, presentment for payment is a merely local act ; presentment for acceptance, a personal one to the acceptor, to enable him to exercise his discretion. Presentment should be within reasonal)le hours ; at a bank before 3 p.m.,* except on Saturdays. Ordinary business hours are more extended.^ [d) A bill is presented at the proper place, — (i.) Where a place of payment is specified in the bill (or acceptance) and the bill is there pre- sented ; (ii.) Where no place of payment is specified, but the address of the drawee or acceptor is given in the bill, and the bill is there presented ; 'Glasscock v. Balls, 24 Q.B.D. 13. ^Parker v. Gordon, 7 East 385. See Sec. 51 (6) (6). »Wilkins v. Jadis 2 B. & Ad. 188. I * General Duties of the Holder. 75 (iii.) Where no place of payment is specified Sec. 45. and no address given, and the bill is presented at the drawee's or acceptor's place of business, if known, and if not, at his ordinary residence, if known ; (iv.) In any other case, if presented to the drawee or acceptor wherever he can be found, or if presented at his last-known place of busi- ness or residence. The words in brackets are not in the Imperial Act. The effect of these rules is that a bill must be presented (i) at the place specified ; (2) if no place specified, at the address of the acceptor ; (3) if no address, (a) at his place of business if known, {l>) if not, at his ordinary resi- dence ; (4) if neither known, to the acceptor personally ; or at his last known place of business or residence. In any other case it would be excused, see Sec. 46 (2) (a). In the case of the acceptor's death, and no place of payment being specified, presentment is provided for in subsection 5, see also sub-section 7, as to presentment at a post-office. Section 39, an/e, having provided when presentment for acceptance was necessary, section 41 provided the rules applicable to such press ^t-.tment. This sub-section provides the rules as to presentment for payment. The first and second rules have obviously no place in the former ; the third, mutatis mutandis, is the counterpart of Sec. 41 (i) {a). (3). Where a bill is presented at the proper place, and, after the exercise of reasonable dili- gence, no person authorized to pay or refuse payment can be found there, no further present- ment to the drawee or acceptor is required. The place being ascertained in any one of the modes mentioned in the preceding sub-section, clause {d), this ■^« 'i| 76 Bills of Exchange Act, 1890. r ■ m I Sec. 45. enacts that the absence of any person authorized to pay or refuse payment does not invalidate the presentment. The acceptor may be dead or moved away." In the case of his death, and no place being specified, the bill must be pre- sented to the personal representative, sub-section (5). Where a place is named which has ceased to exist, a bill would probably be considered payable generally. - (4). Where a bill is drawn upon, or accepted by two or more persons who are not partners, and no place of payment is specified, present- ment must be made to them all. This is the equivalent of Sec. 41(1) {/>). Presentment will be sufficient if made in any one of the modes laid down in sub-section (2) (osf Sec. 51 (6) (a); but it would probably not be held a proper mode in the absence of a recognized custom or usage, or agreement to uiat effect. (7). Where the place of payment specified in the bill or acceptance is any city, town or village, and no place therein is specified, and the bill is presented at the drawee's or acceptor's known place of business or known ordinary residence therein, and, if there is no such place of business or residence the bill is presented at the post-office, or principal post-office in such city, town or village, such presentment is sufficient. ^^;i This sub-section is not in the Imperial Act. It removes a doubt. It was formerly a moot point where and how far such a bill should be presented. The practice heretofore was to present it at all the banking houses, and that was deemed sufficient.^ The advantage of this provision is that presentment at all the banks in a large city is now no longer necessary, and in the smaller places where there is no bank there is now an authorized place where presentment may be made. 'Hey wood v, Pickering, L.R. 9 Q.B. 428. "Hardy v. Woodruffe, 2 Stark 319. ut 78 Bills of Exchange Act, 1890. When such presentment IS dispensed ,,,:«-U ™i,h wun Sec. 46. 4u^ ^i). Delay in making presentment for de'iayTnpn payment is excused when the delay is caused by paymem! °' circumstanccs beyond the control of the holder, and not imputable to his deAiult, misconduct or negligence : when the cause of delay ceases to operate, presentment must be made with reason- able diligence. (Imperial Act 43 and 46 Vic, Cap. 61, Sec. 46.) Nemo ienetur ad impossibile. Where the act of (lod, e.g. death or sudden illness, or accident in transit from causes uncontrollable by the holder, interfere or cause delay, he will be excused under this Act : and probably in some cases where the delay is occasioned by miscarriage in the post- office, see Sec. 49 (5). This sub-section, it should be observed, makjs excuse for delay, but not for want of pre- sentation altogether. Delay is excused by circumstances beyond the control of the holder ; but presentment itself is only excused where it cannot be made as required by the Act in Sec. 45 (2) {d); or where the drawee is a fictitious person ; and as regards the drawer, where the acceptor is not bound to pay the bill ; and as regards an indorser, where it hsis been made for his accommodation, and he has no reason to expect that the bill would be paid if presented, or, where in any case presentment has been waived. See next sub-section. (2). Presentment for payment is dispensed {a) Where, after the exercise of reasonable diligence, presentment, as required by this Act, cannot be effected; The fact that the holder has reason to believe that the bill will, on presentment, be dishonoured, does not dispense with the necessity for pre- sentment. Genkral Duties of the Holder. 79 "As required by this Act," see Sec. 4; (2) [d). Tiie Sec.46. belief of the holder that the bill will be dishonoured is no excuse. This was the law before the Act." [b] Where the drawee is a fictitious person : This could only apply where presentment for acceptance is unnecessary, see Sec. 39. It is not necessary to present a bill for payment which has been dishonoured by non-accept- ance. Sec. 48 (/'). See Schedule I., form D., for form of protest to be used in cases where the holder sees fit to adopt such a course, and the bill is again dishonoured and has been previously only noted for non acceptance. [c) As regards the drawer, where the drawee or acceptor is not bound, as between himself and the drawer, to accept or pay the bill, and the drawer has no reason to believe that the bill would be paid if presented. This was always the law,^ but presentment would still be necessary to charge the indorser.'* [a) As regards an indorser, where the bill was accepted or made for the accommodation of that indorser, and he has no reason to expect that the bill would be paid if presented. This was likewise the former law. The obvious reason is, that should the drawee or acceptor pay the bill, the indorser would at once become indebted to him in the amount of it."* Presentment would still be necessary to charge other indorsers.^ Notice of dishonour is similarly iBowes V, Howe, 5 Taunt. 30 ; Esdaile v. Sowerby, ii East 114. See Conn v. Merchants' Bank, 30 C.P. 380. 2Terry v. Parker, 6 A. «& E. 502; Wirth v. Austin, L.R. 10 C.P. 689. »Saul V. Jones, i E. & E. 59. *Terry v. Parker, supra per Ld. Denman, C. J., p. 506. "Turner v. Sanson, 2 Q.B.D. 23. Ij ■f H M ' ; I ■ F w fl fIfK 1 i 1 ''1 J it •m j 1 '8 ' i [L li 1 i I ! 80 Bills of Exchange Act, 1890. Sees. 46, dispensed with in cases falling under the last four rules ; see ^7-48. p^jf^ Sec. 50(2). (e) By waiver of presentment, express or implied. Dishonour Waiver of presentment does not dispense with notice of by non-pay- ' ment, dishonour. 47. (i). A bill is dishonoured by non-pay- ment (a) when it is duly presented for payment and payment is refused or cannot be obtained, or (d) when presentment is excused and the bill is overdue and unpaid. {Imperial Act 43 and 46 Vic, Cap. 61, Sec. 4/.) Presentment is duly made, when the bill is presented on the day it falls due, by the holder, or on his behalf, at the proper place to the payer, or his representative, or some person duly authorized to pay or refuse payment on his behalf, Sec. 45 (2). As to excuses for presentment, see Sec. 46 (2). Recourse in such case. Notice of dishonour and effect of non- notice. (2). Subject to the provisions of this Act, when a bill is dishonoured by non-payment, an immediate right of recourse against the drawer, acceptor and indorsers accrues to the holder. The provisions referred to are Sees. 64 to 67, relating to acceptance and payment for honour. 48. (i) Subject to the provisions of this Act, when a bill has been dishonoured by non-accept- ance or by non-payment, notice of dishonour must be given to the drawer and each indorser, and any drawer or indorser to whom such notice is not given is discharged ; Provided that — General Duties of the Holder. 8i (a) Where a bill is dishonoured by non-ac- Sec. 48. ceptance, and notice of dishonour is not given, the rights of a holder in due co>.irse subsequent to the omission shall not be prejudiced by the omission. {Imperial. Act 45 and 46 Vic, Cap. d/, Sec. 48.) See the provisions referred to in Sec. 50. The effect of this sub-section, clause {a), is, that when a bill has been dishonoured by non-acceptance and notice of dishonour is not given, a person who becomes holder of it before its maturity, etc., as in Sec. 29, is not prejudiced by the omission. There would be no difificulty in deciding when bills pay- able after date were overdue. Demand bills are deemed overdue when in circulation an unreasonable length of time. Sec. 36 (3). A similar rule applies to bills payable after sight, Sec. 40, and would probably be held to do so in the case of bills payable at sight ; there is none, however, laid down in the Act. At all events, if the bill had been in circu- lation an unreasonable length of time, it would be a circum- stance from which evidence of the want of bona fides required by Sec. 29 might be inferred." {b) Where a bill is dishonoured by non- acceptance and due notice of dishonour is given, it shall not be necessary to give notice of a sub- sequent dishonour by non-payment, unless the bill shall in the meantime have been accepted. This section requires notice to be given to each indorser. By Sec. ^6 post, every person who becomes a party to the bill other than the drawee or acceptor, incurs the liability of an indorser. 'Muilman v. D'Eguino, 2 IL Bl. 565; Mellish v. Rawdon, 9 Bing.,416. '« " " 'lit lifift ' I 82 Bills of Exchange Act, 1890. Sees. 48, 49. Rules as tn notice of dishonour. Before this Act a guarantor was not entitled to notice.' A guarantee must be in writing': if on the note, and it did not vary the ordinary contract of suretyship which an indorser undertakers, Sec. 55 (2) (a), t/uare, whether he would not be entitled to notice of dishonour, by force of Sec. 56. Apart from this, a guarantor under certain circum- stances, as to custom, etc., has been held entitled to expect due presentment and notice.' It is always a very wise pre- caution to give a guarantor some timely notice. 49. (i). Notice of dishonour, in order to be valid and effectual, must be given in accordance with the following rules: — (Imperial Act ^j and 46 Vic, Cap. 6/, Sec. 4g.) {a) The notice must be given by or on behalf of the holder, or by or on behalf of an indorser who, at the time of giving it, is him.self liable on the bill. As notice to the acceptor is not necessary, nor protest. Sec. 52 (3), therefore, no provision is made for the drawer's giving notice. {/?) Notice of dishonour may be given by an agent either in his own name, or in the name of any party entitled to give notice, whether that party is his principal or not. Even the drawee or acceptor may be an agent of the holder for the purpose of giving this notice* But he must have been authorized by the holder to do so.^ 'Hitchcock J'. Humphrey, 5 M. & G. 559; Walton v. Mascall, 13 M. & W. 452 ; Ryan v. McConnell, 18 O.K. 409. 'Wambold v. Foote, 2 A.R. 579. ^ Ex parte Bishop, 15 Ch. D. 400. *Shaw V, Croft, Chit. 9. Ed. 494 ; Rosher v. Kieran, 4 Camp. 87. *Stanton v. Blossom, 14 Mass. 116. GiiNKRAL Duties of tiik Holder. 83 {c) Where the notice is given by or on behalf Sec. 49. of the holder, it enures for the benefit of all subsequent holders and all prior indorsers who have a right of recourse against the party to whom it is given ; [d) Where notice is given by or on behalf of an indorser entitled to give notice as herein- before provided, it enuros for the benefit of the holder and all indorsers subsequent to the party to whom notice is given. An indorser entitled to give notice is one who is himself, at the time, liable upon the bill, sub-section (a) ante. In this country, where inland bills are usually protested for non acceptance or non-payment, it is the custom to give notice to all prior parties. It is submitted, that it is not incumbent on the holder to do so. He might arbitrarily select any one or more of them against whom he intends to rely. If this view is correct, the assumption, that notice has been given to all of them, is made at the risk of any inter- mediate p^rty, who in turn wishes to have recourse against parties prior tc himself who are entitled to notice." His safest course, in all u^ses, would be to give the notice required by this section, see sub-section (i) {e). He might transmit the notice he himself has received.' It is suflficient to send it by post, sub-section (4). It will lie upon him to prove that the letter containing the notice was duly addressed and posted,'' with the necessary postage prepaid, sub-section (4). Branches of the same bank in different towns are, for the purposes of receiving notice, distinct.* {e) The notice may be given in writing or by ^Miers v. Brown, ii M, & W. 372. "Jamieson v. Swinton, 2 Taunt. 224. 'Hawkes v. Salter, 4 Bing. 715. •Steinhoff V. Merchants' Bank, 46 U.C R. 25 ; Prince v. Oriental Bank Company, 3 App. Cas. 325. I 111 ii '•m ■ 1 : li Ii ; i! 1I I • 'vi 84 Bills of Exchange Act, 1890. !l i j m; Sec. 49. personal communication, and may be given in any terms which sufficiently identify the bill and intimate that the bill has been dishonoured by non-acceptance or non-payment. The notice may be given in any terms, but it always was, and still is, under this Act, vital that it should inform the party to whom it is addressed, cither in express terms or by necessary implication, that the bill has been dishonoured.' {/) The return of a dishonoured bill to the drawer or an indorser is, in point of form, deemed a sufficient notice of dishonour. This is a new provision and will only be of avail to banks holding paper for collection. When a bill is held for value it will not be returned without payment or its equivalent : in the meantime, it might be necessary to give notice in the usual way. (^) A written notice need not be signed, and an insufficient written notice may be supple- mented and validated by verbal communication; a misdescription of the bill shall not vitiate the notice, unless the party to whom the notice is given is in fact misled thereby. A notice contained a mistake as to the date of maturity : it was held that the notice was sufficient, as it did not appear that the indorser was misled.- i n fi (//) Where notice of dishonour is required to be given to any person, it may be given either 'Solarte v. Palmer, 7 IJinn. 530, allirmed in the House of Lords, 1 Bing N.C. 194. »Cassidy v. Mansfield, 24 CI'. 383. See also Mellersh v. Kippen 7 Exch. 578 ; Smith v. Whiting, 12 Mass. 0. General Duties of the Holder. 85 .w the party himself, or to his agent in that Sec 49. behalf ; (/) Where the drawer or indorser is dead, and the party giving notice knows it, the notice must be given to a personal representative, if such there is, and, with the exercise of reasonable diligence, he can be found. A notice addressed to the deceased in the usual way is not invalid, if the party giving it, does not know of his death ; see post sub-section (4). Before the Act it was held that notice sent to an indorser in ignorance of his death was sufficient.' (/) Where there are two or more drawers or indorsers who are not partners, notice must be given to each, of them, unless one of them has authority to receive such notice for the others ; [k) The notice may be given as soon as the bill is dishonourv,.., and must be given (not later than the ne.xt following juridical or business day). The words in brackets are not in the Imperial Act ; but the words, "within a reasonable time thereafter," are used in lieu thereof. That Act also contains provisions as to what is reasonal)le time ; and also a clause as to the case of the bankruptcy of the drawer or an indorser. (2). Where a bill, when dishonoured, is in the udisho,, ^ ' ' cMired bill i* hands of an agent, he may either himself give ,\';/]^'^'^,;|^"' notice to the parties liable on the bill, or he may give notice to his principal ; if he gives notice 'Cosgrave v. Boyle, fi SCR. 105. H'i.l 86 Bills of Excpl\nge Act, 1890. }'" Sec. 49. to his principal, he must do so within the same time as if he were the holder, and the principal, upon receipt of such notice, has himself the same time for giving notice as if the agent had been an independent holder : (3). Where a party to a bill receives due notice of dishonour, he has, after the receipt of such notice, the same period of time for giving notice to antecedent parties that the holder has after the dishonour. Notice to atitecedciit parties. See notes to sub-section (i) (d). If the notice was received on Sunday or other non-business day. Sec. 91, the party receiving notice would be entitled to an additional day, sub-section (i) (k).' When tiotice shall be given. (4). Notice of the protest or dishonour of any bill payable in Canada shall, notwithstanding anything in this section contained, be sufficiently given if it is addressed in due time to any party to such bill entitled to such notice, at his custom- ary address or place of residence or at the place at which such bill is dated, unless any such party has, under his signature, designated another place ; and in such latter case such notice shall be sufficiently given if addressed to him in due time at such other place ; and such notice so addressed shall be sufficient, although the place of residence of such party is other than either of such above-mentioned places ; and such notice shall be deemed to have been duly served and •Wright V. Shawcross, cited 2 B. & Aid., at p. 501. General Duties of the Holder. 87 given for all purposes if it is deposited in any Sec. 49. post-office, with the postage paid thereon, at any time during the day on which such protest or presentment has been made, or on the next following juridical or business day ; such notice shall not be invalid by reason of the fact that the party to whom it is addressed is dead. ,S C.Cap. (Not in the Imperial Act — taken in part from R. 123, Sees. 5 and 23.) " Has under his signature designated another place," taken from R.S.C., Cap. 123, Sec. 5; formerly, 37 Vic, Cap. 47, Sec. I. The place designated may be written by a person other than the party to such bill ;' and it remains his address even although the party has changed his place of residence.- Ignorance of the party's residence will excuse, so long as that ignorance continues without any negligence.' If the notice miscarry through the indistinctness of the party's handwriting he will not be discharged.* " Deposited in any post-office with the postage paid thereon." This is an alteration in the law ; R.S.C., Cap. 123, Sec. 23, taken from CS.U.C, Cap. 42, Sec. 16, pro- vided that the notice be deposited in the "post-office nearest to the place of making presentment," and contained no stipulation that the postage should be prepaid. if " Such notice shall not be invalid by reason of the fact that the party to whom it is addressed is dead." This settles by statutory enactment the law as laid down in the much contested case of Cosgrave v. Boyle.' There the appellants discounted a note made by P. and indorsed by S., in the 'Hay V. Burke, i6 A.R. 463. "Hay V. Burke, supra. "Baldwin v. Richardson, i B. & C. 245. ^Bailiie v. Dickson, 46 U.C.R. 167 ; S.C, 7 A.R. 759. "6 S.C.R., 165 ; see also Merchants' Bank r. Bell, 29 Gr. 413, ^k ^hi 88 Bills of Exchange Act, 1890. 1; i : Sec. 49. Canadian Bank of Commerce. S. died leaving the respond- ent his executor, who proved the will belbre the note matured. The note fell due on the 8th May, 1879, and was protested for non payment, and the bank being unaware of the death of S., addressed notice of protest to S. at Toronto, where the note was dated, under 37 Vic, Cap. 47, Sec. i. (Dom.) The appellants, who knew of the death of S. before maturity of the note, subsequently took up the note from the bank, and relying upon the notice of dishonour given by the bank sued the respondent. Held, reversing the judg- ment of the Court of Appeal for Ontario, that the holders of the note sued upon when it matured, not knowing of S.'s death, and having sent him a notice in pursuance of Sec. r, Cap. 47, 37 Vic, gave a good and sufficient notice to bind the respondent, and that the notice so given enured to the benefit of the appellants. Had the appellants acted in ac- cordance with the suggestion made in the notes to sub-sec- tion ( i) (d), ante, there would have been no difficulty. If the drawer or indorser is dead and that fact is known to the party giving the notice, he is bound to send it to the personal repre- sentatives, if they are likewise known or may with reason- able diligence be found, sub-section (i) (/) : if he does not know of the death, a notice addressed merely to the deceased is sufficient, and will enure to the benefit of any subsequent party." Miscnr- lc\ Whcrc a notice of dishonour is duly riane in \>-'/ / post service, ^j J j,^ggg^^ Ettd postcd, Bs abovc provided, the sender is deemed to have given due notice of dishonour, notwithstanding any miscarriage by the post-office. " As above provided," i.e. in the previous sub-section (4). It lies on the sender to prove that the letter enclos- ig the notice was duly addressed and posted." A protest is suffi- cient //*/»/<7/a) is reproduced from C.S.C., Cap. 123, Sec. 22, and is not contained in the Imperial Act. It makes no change in the law. Although banks generally close on Saturdays at one o'clock, a protest General Duties of the Holder. 95 for non-payment of a bill domiciled at a bank made before Sec. 51. three o'clock would be irregular. A right of action accrues as soon as a bill is dishonoured by non-acceptance, Sec. 43 (2); or by non-payment, Sec. 47. In Edgar v. Magee' it was contended that, where a bill had been dishonoured by non-payment, an action might begin at any time after three o'clock in the afternoon, even on the day of maturity. Although not necessary for the decision of the case, the leaning of the Court seems to have been favour- able to that contention. Qu. whether it would not be held otherwise now, that by Sec. 14 (3) the time of payment is determined by including the day of payment. Full effect might still be given to the clause under consideration, by limiting its effect to ascer- taining the hour when a protest may be first made. The law does not ordinarily notice the fraction of a day.^ What pro- test shall set forth. (7). A protest must contain a copy of the bill, ,estshaii (or the original bill may be annexed thereto), and (the protest) must be signed by the notary making it, and must specify — {a) The person at who.se request the bill is protested ; (d) The place and date of protest, the cause or reason for protesting the bill, the demand made, and the answer given, if any, or the fact that the drawee or acceptor could not be found. The words in brackets are not in the Imperial Act. It will be observed that a protest need not be under seal. The practice of sealing would still be prudent in the case of foreign bills. *i OR. 287. See also Sinclair v. Robson, 16 U.C.R. 211; Warne v. Lawrence, W.N. (18S6) 55. 'Clarke v. Bradlaugh, L.R. 72 B.D. 151, and in App. 82 B.D. 63, ^\l-'V If bill is lost, etc. 96 Bills of Exchange Act, 1890. Sec. 51. (8). Where a bill is lost or destroyed, or is wrongly (or accidentally) detained from the person entitled to hold it, (or is accidentally retained in a place other than -vhere payable), protest may be made on a copy or written par- ticulars thereof. The words in brackets are not in the Imperial Act. The copy or particulars would have to be made up from the best records preserved. There arc no degrees of se- condary evidence ;' but a party giving secondary evidence must give all its terms." Merchants' bill books should contain all the data from which to make the copy of the bill or the written particulars of it. Excuses for (g). Protcst is dispcnscd with by any circum- non-protest ^ ^ ' ' ' ■' and delay, gtances whlch would dispen.se with notice of dishonour. Delay in noting or protesting is excused when the delay is caused by circum- stances beyond the control of the holder, and not imputable to his default, misconduct or negligence. When the cause of delay ceases to operate, the bill must be noted or protested with reasonable diligence. See Sec. 46 and notes thereto, as to excuses for delay in presentment for payment ; and Sec. 50, as to excuses for non- notice and delay. bi!i"no[to (10). No clerk, teller or agent of any bank shall act as a notary in the protesting of any act as notary 'Taylor on Evidence, 6 Ed. p. 510. ''Ross V. Williamson, 14 OR. 184. See Sugden r. Lord St. Leonards, i P.D. 154 ; where on an application for probate the con- tents of a lost will, of a very lengthy and complicated character, were allowed to be proved by the evidence of a single witness from memory. General Duties of the Holder. 97 bill or note payable at the bank or at any of the Sees. 51, branches of the bank in which he is employed. {R.S.C., Cap. I2S, Sec. //.) S9, (i). When (no place of payment is speci- ',;.'|?^^',','^>',''I[ fied in the bill or acceptance), presentment for },',Xr'""'' payment is not necessary in order to render the acceptor liable. {Imperial Act 45 and 46 Vic, Cap. 61, Sec. 52.) The words in brackets are not in the Imperial Act, but in lieu thereof, " a bill is accepted generally." To charge the drawer or indorsers it would still bf, neces- sary to present the bill. Sec. 45, subject to the provisions of Sec. 46. See also Sees. 48 and 50. As to modeof present- ment of a bill where no place is specified, see Sec. 45 (2) {d) sub-clause 3. (2). When a place of payment is specified in the bill or acceptance, the acceptor, in the absence of an express stipulation to that effect, is not discharged by the omLssion to present the bill for payment on the day that it matures, but if any suit or action be instituted thereon before presentation the costs thereof shall be in the discretion of the Court. See Sees. 19 and 45, ante, and notes thereto. This sub- section is very much changed from the corresponding one in the Imperial Act. It has been held that the omission to present at a bank, a debenture made payable there, was fatal to an i::,l!i:J-; li :( 'l 98 Bills of Exchange Act, 1890. m ■j ■ ! j ni in 1 i^'f W 1 ! 1 Sec. 52. action brought upon it." Under this enactment presentment, in the absence of an express stipulation to that effect, is not a condition precedent, but the holder proceeds to an action at the peril of costs. The omission might affect the holder's right to interest.' Making a bill payable at a bank by its customer is authority to the former to apply its customer's funds in payment of the bill.^ If in such a case the customer could show he was damnified by the omission to present the bill on the day of its maturity, he would probably be discharged. •* See Sec. 73 (e/ore it was payable, by parol and without satisfaction.'* The ' Vagliano v. Bank of England, 23 Q.B.D. 243. ^Freakley v. Fox, g B. & C. 130. •■•Ingle V. Richards, 28 Beav. 3G6 ; Strong v. Bird, L.R. 18 Eq. 315. ♦Foster v. Dawber, 6 Exch. S39, and see per Parke B, at p. 852. Ill i: ! t : 112 Bills of Exchange Act, 1890. Sees. 61, effect of this subsection is, it seems, to dispense with the need of conj;ideration in any case. A renunciation in writing is Kood without delivery of the bill. If the bill is delivered up, the renunciation need not be in writing. The renunciation must be complete ; a mere memoran- dum or note of an intention or desire to renounce would not be sufficient. Therefore a written direction by the holder of a note, payable on demand, that it be destroyed as soon as found, given on his death-bed, at a time when it could not be found, is not a renunciation.' In the last case it was doubled whether the renunciation can be signed by an agent," but the attention of the Court was not directed to Sec. 90 {i)/>ost. If the renunciation is conditional, it would probably not be sufficient alter the maturity of the note, without consider- ation to support it. At common law a contract could not be discharged, after breach, by accord without satisfaction. ThrsaiiK. (2). The liabilities of any party to a bill may in like manner be renounced by the holder before, at or after its maturity ; but nothing in this section shall affect the rights of a holder in due course without notice of renunciation. As a delivery would be ina[)plicable in this case, the words "in like manner" must bo understood to refer to a renunci- ation in writing only. Any indorscr who would have had a right of recourse against the party, whose liability is thus dis- charged, would bo likewise discharged. ' It is noticeable that Sic. 63 (2) makes this provision in tho case of cancellation, whilst this sub-section omits to do so. C;iii<(:lla- tion of hill. US. ( I ). Where a bill is intentionally can- celled by the holder or his agent, and the '/;i )'(• GeorfTC, Francis v. Hriice, 44 Cli. D. C)2'j. "^Ihid, at p. ()j2. ■'Chalmers on Hills p ic)9, lllusliuitioii Xo. 2 and authorities here cited. Discharge of Bill. "3 cancellation is apparent thereon, the bill is dis- Sees. 62, charged : (2). In like manner, any party liable on aofany 1. • signature. bill may be discharged by the intentional can- cellation of his signature by the holder or his agent. In such case, any indorser who would have had a right of recourse against the party whose signature is cancelled is also discharged : (i). A cancellation made unintentionally, or Erroneous . , . , , . cancella- under a mistake, or without the authority of the ''°"- holder, is inoperative ; but where a bill or any signature thereon appears to have been cancelled, the burden of proof lies on the party who alleges that the cancellation was made unintentionally, or under a mistake, or without authority. {Imperial Act 45 and 46 Fie, Cap. 6t, Sec. 6j,) The mere fact of cancelling the signature of the makers of a dishonoured note, and writing paid on it, corrected before the note is sent back by a memorandum thereon "cancelled in error" is not effectual to charge a bank with the receipt of the money." !> . i; Oil. ( I ). Where a bill or acceptance is ma- Alteration ^ ' _ *■ of bill. terially altered without the assent of all parties liable on the bill, the bill is voided, except as against a party who has himself made, author- ized or assented to the alteration, and subse- quent indorsers: ' Prince i>. Oriental Bank V, Rogers, 5 M. & G. 340 Corporation, 3 App. Cas. 325 ; Warwick 114 Bills of Exchange Act, 1890. Sec. 63. Proviso. mm r ■ li I! Provided, that where a bill has been mater- ially altered, but the alteration is not anparent, and the bill is in the hands of a holder in due course, such holder may avail himself of the bill as if it had not been altered, and may enforce payment of it according to its original tenor. (Imperial Act 45 ixnd 46 Vic, Cap. 61, Sec. 64.) The proviso is new. It intrenches on the principle that honest acquisition confers no title when made through a forgery.' Before the Act, when the makers handed the defendant a printed form of a promissory note, with all the blanks filled in, and complete in every respect, except that it had not been signed by the intended makers, and defen- dant indorsed it for their accommodation, and handed it back to them, when they, without defendant's knowledge, added after the words "value received," "with interest at 10 per cent, per annum," then signed it, and transferred it for value to plaintiff without notice of the alteration ; held defendant was discharged ;' and where the payee of a note tore off a memorandum in the margin, restricting the negotiability of the note, it was held the maker was discharged, as against a holder for value without notice.' When a promissory note had been avoided by an alteration made by the maker, a subsecjuent promise by the indorser to pay it, without know- ledge of the alteration, was held insufficient.* ma'teria'i'' C^)' I n partlcular, thc following altcrations Hrc alterations, m^t^^rial, namely, any alteration of the date, the sum payable, the time of payment, the place of payment, and, where a bill has been accepted *Jenks V. Doran, 5 A K. 558. Icrow V. Kelly, 28 C.P. 551. 'Swaislnnd v Davidson, 3 O.K. 320. *WestIoh J'. Brown, 43 U.C.K. 402 Discharge of Bill. 115 generally, the addition of a place of payment Sec. 63. without the acceptor's assent. A note had been altered by adding a place of payment, and the words "with interest, etc." It was held valid not- withstanding, as it conformed to the original intention of the parties, and likewise because the indorser had subsequently assented to it." The following were held material alterations before the Act: changing the place of payment;' adding another maker's name to a several note;' changing the date from 1873 to 1874 of a cheque/ Changing the date might not be deemed a material alteration if it were to correct a mere clerical error.^ Insertion of the date, when omitted accident- ally, was held not a material alteration in a hire receipt;* nor the filling in of a payee's name in a debenture.' As to such alterations as these, however, see now the provisions contained in Sec. 20 (i), ante. The insertion of the words, " this note to be held as collateral security " was held to vitiate the instrument as a material alteration." AVhere a person signs a bill induced by a fraudulent misrepresenta- tion as to its character, he is not liable even to an innocent holder,' unless he has been guilty of negligence, and not even then, unless the negligence is the proximate cause of its being taken."' > Fitch V. Kelly, 44 U.C.R. 578. '■'McQueen v. Mclntyre, 30 C.P. 426. ='Reid V. Humphrey, 6 A.R. 403. MJeltz V. Molsons Bank, 40 U.C R. 253. "See Sayles v. Brown, 28 Gr. 10; Somerville v. Rae, 28 Or. 618 "Mason v. Bickle, 2 A.R. 291. 'Bank of Toronto v. Cobourg, 7 O.R. i. "Hall V. Merrick, 40 U.C.R. sOfj. "Foster v. Mackinnon, L. R. 4 C.P. 704. '"Queen v. Chesley, 16 S C.R. 306, the case of a Bond ; Swan v. North British Australasian Company, 7 H. & N. 603; 2 H. & C. 175. As to negligence, see the cases of Young v. Grote, 4 Bing. 253; Arnold v. The Cheque Bank, i C.P.D. 578. ■MX it yM i ii6 Bills of Exchange Act, 1890. Sec. 63. SATISFACTION, EXTINGUISHMENT, SUSPENSION AND RELEASE. The preceding title or division of the Act, embracing Sees. 59-63, treats of the absolute discharge of the bill. In addition to a discharge, as provided for in those sections, the liability upon a bill may be satisfied, extinguished, suspended or released. Satisfaction. — A bill may be satisfied by the receipt of a smaller sum than the amount due upon it, if i)aid by a third person with that intent.' Payment of a smaller sum by the party himself is not satisfaction,- but the acceptance of a negotiable security for a smaller sum may be,' and in Ontario since the Judicature Act, R.S.O. 1887, Cap. 44, Sec. 53 (7), the common law rule, as laid down in I'oakes v. Beer and other cases cited therewith, has been changed : so that part performance of an obligation, either before or after breach, when expressly accepted in satisfaction, extin- guishes it ; but (jmvre in the case of a bill or note whether such satisfaction would not require to be evidenced in writ- ing, see Sec. 61 (i), unless it was delivered up.^ Taking security from one of several parties, the joint makers of a note or acceptors of a bill, will in general dis- charge the others.' ExTiN(JuisnMF.NT. — Judgment recovered on the bill or note is an extinguishment of the original debt between the plaintiff and the defendant, but it does not otherwise restrain 'Welby V. Drake, r C. & V 557 ; Cooper v. Tarker, 15 C.B. 822. 'I'innel's Case, 5 Kep. 117 . Morgan, 5 T.K, 513; 2 Wms. Saunders, 106 E.; Steadman v. Gooch, i Esp. 3. "Thomp.son v. Wilson, i C.P. 57 ; Belshaw v. Bush, 11 C.B. 191; I'ricc V. Price, 16 M. & W. 232 ; Shanly v. Midland Railway Com- pany, 33 U.C.R. 604, '"James v. Williams, 13 M. & W. 828. I.i * ! s^ § , i ii8 Bills of Exchange Act, 1890. Sec. 63. of a transferee," the original debt revives.- It is not payment quoad third parties.^ If the renewal bill be discharged by an alteration, an action may be brought on the first. ■• A bill taken as collateral security does not suspend the right of action. 5 Release. — A release under seal requires no consideration to support it. If given by one of several joint creditors, or to one of several jointly liable upon a bill or note, it is a release to all/' But a covenant not to sue one of two joint debtors does not operate as a release of the other.' The relationship between the acceptor of a bill or the maker of a note, and the other parties liable thereupon res- pectively, \'i, prima facie \}(\dX of principal and surety; simi- larly the drawer of a bill is as to the first indorser a ^-rincipal and such indorser, a surety ; and each indorser is in turn a principal and the subsequent indorser a surety. The same principle applies in the case of a note. Evidence, however, is admissible to show the real relationship.** Such inquiry, in general, has only become material in the case of accommo- dation paper ; but (juvere whether the law will not be altered in this respect by force of Sec. 28 (2). Any act which discharges the principal debtor, thereby discharges the sureties,' unless the holder expressly reserves his rights against them,'" since in that case, though exonerated •Price V. I'rice, sitpni. -C.'inadian IJank of Commerces. Woodward, 8 \. \. 347 ; Healey V. Dobson, 8 O.R. G91 ; Sayer v. Wapstaff, 5 Heav. 423; Maillard V. Duke of Argyle, 6 Scott N.K. 938; London Birmingham and South Staffordshire Hank, Limited, In re, 34 L.J. Ch. 418. ''Blackley v. Kenny, 19 OR. i6g , Carruthers r. Ardagh, 20 Gr. 579- ••Slonian v. Cox, i <^".M. & R 471. "MolsonsBank t/. McDonald, 40 U.C.R. 529; affirmed, 2 A.R. 102. "Cheetham v. Ward, i B. & P. 630 ; Nicholson v. Revill, 4 Ad. & E. C75. 'Hutton 7J. Eyre, 6 Taunt. 289; Price w. Barker, 4 E. & B. 760. 'Ewin V. Lancaster, 6 B. & S. 571, 577; Oriental Financial Cor- poration V. Gurney, L.R. 7 Ch. App. 142; affirmed, 7 H.L. 348. "Oriental Financial Corporation v. Gurney, stipni. •"Muir V. Crawford, 2 H.L., Sc. 456. nt >y ill of Satisfaction, Extinguishment, Etc. 119 by the holder, the principal debtor continues liable to the Sec 63. claims of the sureties." Giving time to the principal releases the surety, as by taking a renewal bill for the debt,= or for the interest ;3 but, semble, accepting payments of interest which have accrued due on an overdue bill or note, since its maturity, does not discharge the indorsers.'' It makes no difference, if the relationship of principal and surety is created after the debt accrued, if the holder has notice,' but now as to accommodation bills, see Sec. 28 (2). When a mortgage was taken as collateral security at a longer date, it was held not to release the sureties.* Giving time to one of three executors of an estate, for a debt of which he was the principal debtor and the testator had been surety, was held not to release the estate." Any negligence on the part of the holder prejudicial to the surety discharges him, pro tanto? If collateral security is held, the holder is bound to use due diligence in realizing and protecting the same. Failure to do so discharges the debt, pro tantoP ^Muir V. Crawford, supra. *Gould V. Robson, 8 East 576 ; Blackley v. Kenny, 19 O.R. 169. ''Darling v. McLean, 20 U.C.R, 372. ♦Wilson V. Brown, 6 A.R. 411, 413. 'Bailey v. Griffith, 40 U.C.R. 418. "Molsons Bank v. McDonald, 40 U.C.R. 529, affirmed 2 A.R. 102. ^Austin V. Gibson, 28 C.P. 554. "Molsons Bank v. Girdlestone, 44 U.C.R. 54; Canadian Bank of Commerce ;;. Green, 45 U.C.R. 81. "Synod of Toronto v. DeRlaquiere, 27 Gr. 536 ; Merchants' Bank * V. McKay, 12 OR. 498; S.C. in Appeal, 15 SCR. 672; Ryan v, McConnell, 18 O.R. 409; Blackley v. Kenny, 19 O.R. 169. M' : i FfWl' 'if '!-''Hln UiLmm. 120 Bills ok Exchange Act, 1890. Sec. 64. 1 Acceptance for honour supra pro- test. ACCEPTANCE AND PAYMENT FOR HONOUR. 64, (i). Where a bill of exchange has been protested for dishonour by non-acceptance, or protested for better security, and is not overdue, any person, not being a party already liable thereon, may, with the consent of the holder, intervene and accept the bill supra protest, for the honour of any party liable thereon, or for the honour of the person for whose account the bill is drawn. {Imperial Act 4.3 and 46 Vic, Cap. 61, Sec. 6j.) It is sufificient if the hill has been merely noted, Sec. 92. A holder is not bound to take an acceptance for honour, as he may prefer to avail himself of the provisions of Sec. 43 (2). The drawee, not being a person already liable, might, it seems, accept a bill for honour, except in the case where it has been protested for better security. The advan- tage of his doing so would be, that then the drawer, as to him, is a principal debtor on the bill, and he is but a surety, Sec. 67 (5), unless he has accepted it for the honour of a subsequent party. A bill accepted for honour must be pre- sented for payment and protested before the acceptor is liable. Sec. 66 (i), and this is an exception to the rule laid down in Sec. 43 (2). In part. (2). A bill may be accepted for honour for part only of the sum for which it is drawn. As to the effect of partial acceptances, see Sec. 44 (2). If the acceptance for honour was otherwise qualified, the other provisions laid down in Sec. 44 (2) would apply. n e Acceptance and Payment for Honour. 121 (3). An acceptance for honour supra protest, Sec. 64. in order to be valid, must — memj'fJr validity. {a) Be written on the bill, and indicate that it is an acceptance for honour ; {h) Be signed by the acceptor for honour. An ordinary acceptance to be valid must be written on the bill and be signed by the drawee ; or the mere signature is sufficient without additional words, Sec. 17 (2) (a). The signature .alone in the case of an acceptance for honour is insufficient; "accepted supra protest" or "accepted S.P." arc sufficient modes of accepting for honour, but the full form is "accepted supra protest for the honour of A." Before the Act, it was the practice for an acceptance for honour to be attested by a notarial " Act of honour " record- ing the transaction ;' but this practice, it is thought, is no longer essential. \.:\ I : (4). Where an acceptance for honour does not For whose ^ ' ^ ^ ^ _ honour. expressly state for whose honour it is made, it is deemed to be an acceptance for the honour of the drawer; ( S )• Where a bill payable after sight is accepted computa- \^' *■ ^ c> 1 tionoftimt for honour, its maturity is calculated from the date of (protesting) for non-acceptance, and not from the date of the acceptance for honour. The word in brackets is not in the Imperial Act, but instead thereof, "the noting." Should the short mode of accepting for honour mentioned ante sub-section 3 be used, it follows from sub-section 4 that the acceptance is deemed for the honour of the drawer. The omission of the date is not material, as in sight bills the ,'i 'Chalmers on Bills, 210; Mitchell v. Baring, 10 B. & C. 4. I 122 Bills of Exchange Act, 1890. Sees. 64, time begins to run from the date of noting or protest, and wS» 00. j^^^j fj.Qj^^ ji^j, jjjjg Qf ji^g acceptance for honour, and see Sec. 14 (4). Before this Act it was held that the time was to be calculated from the date of acceptance for honour." Liability of acceptor for honour. 6*1. ( I ). The acceptor for honour of a bill by accepting it engages that he will, on due present- ment, pay the bill according to the tenor of his acceptance, if it is not paid by the drawee, pro- vided it has been duly presented for payment and protested for non-payment, and that he re- ceives notice of these facts: To what (2), The acceptor for honour is liable to the parties. ^ ' ' holder and to all parties to the bill subsequent to the party for whose honour he has accepted. {Imperial Act 45 and 46 Vic.^ Cap. 61, Sec. 66.) Sec. 45, ante, provides for the mode of presentment for payment to the drawee ; and Sec. 49, for the mode of giving notice. The reason that the bill must be presented for pay- ment to the drawee is, that by the arrival of funds, his position may be changed and that he may then be willing to satisfy the bill.- See Sec. 54, ante, as to the undertaking of an acceptor. An acceptor for honour is bound by the same estoppels. ' Present- ment to 00. (i). Where a dishonoured bill has been for^Ciour. accepted for honour supra protest, or contains a reference in case of need, it must be protested for non-payment before it is presented for pay- ment to the acceptor for honour, or referee in case of need. 'Williams v. Germaine, 7 15. & C. 46S. '^Hoare v. Cazenove, iC East 391. =• Phillips V. Im Thurm, L.K. i C.P. 4G3. he Acceptance and Payment for Honour. 123 (Imperial Act 45 and 46 Vic, Cap. 61, Sec. 67.) Sec. 66. By virtue of Sec. 92, it is sufficient if the bill has been merely noted. The formal protest may be drawn up at any time, even after action brought." See Sec. 15 as to the re- feree in case of need. (2), Where the address of the acceptor for ll^^^^^"! honour is in the same place where the bill is '"^"'' protested for non-payment, the bill must be pre- sented to him not later than the day following its maturity; and where the address of the ac- ceptor for honour is in some place other than the place where it was protested for non-payment, the bill must be forwarded not later than the day following its maturity for presentment to him. It would be competent for the acceptor for honour, under our Act, to name a place of payment in his acceptance, Sec. 19 (2) ; and presentment there would be sufficient, Sec. 45 {d). The consequence of delay in making presentment, as required by this sub-section, would probably be held to be fatal, and to release not only the acceptor for honour, but also all parties who would have been discharged by his pay- ment. There is at present no decision, however, as to this. (x). Delay in presentment or non-presentment Excuses for \>-'' •^ r I non-pre- is excused by any circumstance which would ^^g^^^*"' ""^ excuse delay in presentment for payment or non- presentment for payment. As to the circumstances which excuse delay or non-pre- sentment, see Sec. 46. 'Geralopulo v. Wieler, 10 C.B. 690. J f^ II 124 Bills of Exciiangk Act, 1890. non-pay- ment, Payment for honour si4pra protest. 1 I Sees. 66, ^^y When a bill of exchange is dishonoured prot'^for ^y ^he acceptor for honour, it must be protested for non-payment by him. And thus there might he three protests. Qturre whether the expenses of the protest provided for in this sub-section are recoverable '.gainst parties antecedently liable upon the bill, under Sec. 57 {a) : as in no case is the holder bound to take an acceptance for honour.' See however, Sec. 93 (2). 07. (i). Where a bill has been protested for non-payment, any person may intervene and pay it supra protest for the honour of any party liable thereon, or for the honour of the person for whose account the bill is drawn. (Imperial Act 4^ and 46 Fie, Cap. 6/, Sec. 6S.) The preceding sections provide for acceptance for honour and the proceedings consetiuent thereon. This section pro- vides for payment for honour and will apply in cases, either where acceptance is unnecessary, under Sec. 39 (3) : or where a bill having been duly accepted is dishonoured by non-payment. There is no restriction in this section as in Sec. 64 (i), ante, so that no person is precluded ' terms from intervening as a payer for honour, v a party or not, although there would be, in general, a iifest incongruity in the former doing so. The provision t.i Sec. 92 applies, and it is not necessary if the bill has been noted that the protest should be extended before the payment for honour. (2). Where two or more persons offer to pay a bill for the honour of different parties, the person whose payment will discharge most par- ties to the bill shall have the preference : 'Mulford V. Walcott, 12 Mod, 410. If more than one offer to pay. Acceptance and Payment for Honour. 125 'd tier |on lie [to (3). Payment for honour sft/>ra protest, in Sec^. order to operate as such and not as a mere volun- Aitestation. tary payment, must be attested by a notarial act of honour, which may be appended to the pro- test or form an extension of it: (4). The notarial act of honour must founded on a declaration made by the payer for honour, or his agent in that behalf, declaring his intention to pay the bill for honour, and for whose honour he pays. \)Q Basis hereof. If not accompanied by a notarial act, it will be a mere voluntary payment, and the payer will be an indorsee of an overdue or dishonoured bill, to which all defects of title attach.' (s). Where a bill has been paid for honour, i-iabiuties ^^^ , ' iind rights all parties subsequent to the party for whose '^Jl^^ honour it is paid are discharged, but the payer for honour is subrogated for and succeeds to both the rights and duties of the holder as regards the party for whose honour he pays, and all parties liable to that party. '.' ' \\ The effect of this, it is submitted, is to place the payer for honour, as far as regards the party for whose honour he pays and for all parties liable to that party, in the position of a surety who has paid a debt for his principal. It is likewise submitted that this sub-section applies to an acceptor for honour paying the bill, and even should it be held that in terms it does not do so it is conceived the same principles iMertens v. Winnington, i Esp. 113. i; . lip In 126 Bills of Exchange Act, 1890. Sec. 67. apply.' The acceptor for honour, wJien the bill has been protested for better security, has his remedy also against the acceptors Delivery to payer for honour. EHcct of re- fusal to re- ceive pay- ment. (6). The payer for honour, on paying to the holder the amount of the bill and the notarial expenses incidental to its dishonour, is entitled to receive both the bill itself and the protest. If the holder does not on demand deliver them up, he shall be liable to the payer for honour in damages. After payment for honour and delivery of the bill to the payer the bill ceases to be negotiable.' (7). Where the holder of a bill refuses to re- ceive payment supra protest, he shall lose his right of recourse against any party who would have been discharged by such payment. It would appear that promissory notes may be and some- times are paid supra protest. The language of this section would seem to apply to tliem as well as to bills, and see Sec. 88(1) and (3). 'Hyles on Hills, p. i-jC>. ^Ex parte Wackerbath, 5 Ves. 574. ^Kx piirtc Swan, L.R. 6 Lq 344. Lost Instruments. 127 en he ^d Sec. 68. LOST INSTRUMENTS. 08. ( I ). Where a bill has been lost before it Hoider-s V ' right to is overdue, the person who was holder of it may I'o"^ b'jf/.*' °^ apply to the drawer to give him another bill of the same tenor, giving security to the drawf . , if required, to idemnify him against all persons whatever in case the bill alleged to have been lost shall be found again : (2). If the drawer, on request as aforesaid, re- if refused, fuses to give such duplicate bill, he may be com- pelled to do so. (^Imperial Act 45 and 46 Fh:, Cap. 61, Sec. 6q.) This section probably introduces a change in tlie law in Ontario and throughout Canada. There was no similar pro- vision in the repealed Act, R.S.C., Cap. iit^. It is tran- scribed "rom the Imperial Act and reproduces the effect of 9 and 10, William III., Cap. 17, Sec. 3 (Imp.). That Act only applied to bills drawn or dated and payable in England, Wales and Herwick-upon-Tweed, for the sum of five pounds sterling and upwards. There is no decided case in Ontario that this latter Act was in force here, and being of a local character it is extremely doubtful whether it would have been hold to be so.' This enactment will not be of much utility, except where the bill is still held by the payee, as there is no provision for obtaining indorsements over again ; and not eveii then if the bill has been accepted, as it is equally silent on the subject of procuring a new acceptance.- 'Doe clem, Ancierson ?'. Toild, 2 U.C.R. 82; Regina r. Harnes, 45 U.C It. 276; l-'orsyth s Constitutional Law, pp. nS ct scq, '^See however as to this, Uyles on Bilk, G Am. lid. 378 ; Davis V. Dodd, 4 Taimt. 602. n SI 128 Sec. 68, 69. Action on lost bill. Bills of Exchange Act, 1890. The sufficiency of the security offered is to be determined as a question of fact. No definite rule can be laid down. It must be to the satisfaction of the drawer. If he acted unreasonably or capriciously he would have to pay the costs of any action ])rought against him and would be liable also to any damages that the loser of the bill had sustained by his delay. 09. In any action or proceeding upon a bill, the court or a judge may order that the loss of the instrument shall not be set up, provided an indemnity is given to the satisfaction of the court or judge against the claims of any other person upon the instrument in question. 5 ! {Ijiipii-iiil Act 45 and 46 V'u.^ Cap. 6/, Sec. Jo.) It was formerly held that no action would lie on a lost bill at the suit of the I /ser :' or even on the consideration. ' In such cases the proper remedy was in etiiiity, not only on tlie t^round that tlicrc was no remedy at law, but also on account of the power Courts of F/piity possessed of compel- ling the plaintiff to give the defendant proper indemnity. This led to liie passing in Ontario of the enactment found in Con. .Stat. U.C!.. Cap. 42, Sec. 3,^, and subseiiuently in Sec. 143 of the Common Law Trocedure Act, R.S.O. 1S77, Cap. 50. which provided tiiat in an action founded ujion a lost bill or other negotiable instrument, the court or judge might order that the loss of the instrument sliould not be set up, if an indemnity against the claims of any oilier person under such instrument was given to the satisfaction of the court or judge. This statute, however, did not take away the juris- diction of equity over lost bills. ,\fter the introduction of the Ontario Judicature Act, K.S.O., Cap. 44, this section in the Com. 1-. \\ Act was repealed as an unnecessary provision. 'JLnnsard 7. Robinson, 7 15. I'v C. 95 ; Davis j. Dodil, 4 Taunt. 602; Kamuz !•. Crowe, i M.xch. 167. *Crowe V, Clay, q Kxch. 604. Lost Instruments. 129 since, by Sec. 16 of the Judicature Act, the former Courts of Sees. 69, Law and Equity were consolidated and authorized to admin- 70- ister law and equity concurrently. The v: :ion annotated is a reproduction of the repealed Sec. 143 of the Common Law Procedure Act. If no tender of indemnity is made before action, the plaintiff will seldom be entitled to his costs and may be ordered to pay the defendant his costs." The loss of a bill is no excuse for neglect to give notice of dishonour." See Sec. 5 1 (8) as to the mode of protesting a lost bill. ■I RILL IN A SET. 70. (i). Where a bill is dravvn in a set, each -^f^gts^'"* part of the set being numbered, and contc.'ning a reference to the other parts, the whole of the parts constitute one bill. ,1 {Impo'ial Act 4j and 46 Vic, Cap. 6f, Sec. 7/.) Foreign bills are often drawn in parts. See Sec. 4 as to the definition of a foreign bill. Omission to number the parts of the l)ill, and make each refer to tlie other, would be in effect to issue so many separate bills, and to render the drawer liable upon each in the hands of a holder in due course. Sec. 29, or even perhaps a holder for value, Sec. 27 (2).' 'King 7'. Zimmerman, L.R. 6 CP. 4G6 ; La Banqtie Jacques Cartier 7'. Strachan, 5 I'.K. 159. '^Thackeray v. Blackett, 3 Camp. 164. 'Davidson v. Robertson, j Dow. 21S ; Kearney z/. West Granada Gold and Silver Mining Co., 1 H. & N. 412. A 130 Bills of Exchange Act, 1890. If indorsed to different persons. Sec. 70. (2). Where the holder of a set indorses two or more parts to different persons, he is liable on every such part, and every indorser subse- quent to him is liable on the part he has himself indorsed as if the said parts were separate bills. The indorser is l)ound to pass all the parts of the bill in his possession to his transferee.' The indorser incurs liabil- ity on one of the parts only unless he delivers them to dif- ferent holders.- If negotia- ted to dif- ferent holders. (3). Where two or more parts of a set are negotiated to different holders in due course, the holder whose title first accrues is, as between such holders, deemed the true owner of the bill ; but nothing in this sub-section shall affect the rights of a person who in due course accepts or pays the part first presented to him. As to payment in due course, see Sec. 59. Acceptance. ^^^j yj^g acceptance may be written on any part, and it must be written on one part only: (5). If the drawee accepts more than one part, and such accepted parts get into the hands of different holders in due course, he is liable on every such part as if it were a separate bill The drawee should only pay the part he accepts. Upon payment of that, the whole bill is discharged.' Should he pay a part that does not bear his acceptance his liability still continues : see next sub-section. If more than one part is accepted. •Pinard r. Klochman, 3 B & S. 388. 'Holdsworth v. Hunter, 10 B. & C. 449. "Holdsworth 7', Hunter, supra. Bill in a Set. 131 (6). When the acceptor of a bill drawn in a Sees. 70, set pays it without requiring the part bearing p^ — ^ his acceptance to be delivered up to him, and diiweri that part at maturity is outstanding in the hands pan^""*" of a holder in due course, he is liable to the holder thereof: (7). Subject to the preceding rules, where Discharge. any one part of a bill drawn in a set is discharged by payment or otherwise, the whole bill is dis- charged. As to the mode in which a bill may be discharged other- wise than by payment, see, ante, Sees. 59-63 and notes. CONFLICT OF LAWS. The subject of the " Conflict of Laws " is too comprehen- sive to be treated in the compass of an elementary work of this character. The student who desires to master it is referred to Story's Conflict of Laws, passir/i ; Savigny's Inter- national Law, Sec. XXX., Note B.; Byles on Bills, Cap. 24, on " Foreign Law." The rules laid down in this section will have the merit of settling the law on some of these points. The decisions of the courts upon the subject of international law are often confusing, irreconcilable and contradictory. 71. (i). Where a bill drawn in one country Rules where ^ ^ J ' laws con- is negotiated, accepted or payable in another, "'*='• the rights, duties and liabilities of the parties thereto are determined as follows : — i\\ i $ I -Mr m I if Sec. 71. Valiilily, how cltttr- iMinecl. n2 Bills ok Exciiancie Act, 1890. (a) 1 he validity of a bill as regards requisites in form is determined by the law of the place of issue, and the validity as regards requisites in form of the supervening contracts, such as ac- ceptance, or indorsement, or acceptance sf/pra protest, is determined by the law of the place where such contract was made. 1 ' (Iiiif'ci'itil Act 4^ and 46 Vic, Cap. 6/, Sec. 7.'.) A note made in Ontario, payable in Quebec, before the Act, was held a contract made in ()uebec, the place of per- formance." Bills of exchange were drawn in France by a domiciled Frenchman, in the French language in English form, on an English company, who duly accepted them. The drawer indorsed the bills and sent them to an Englishman in V.ng- land. Held, that the acceptor could not dispute the negoti- ability of the bills by reason of the indorsement being invalid according to French law.- In Story's Conflict of Laws, Sec. 314, Mr. Justice Story puts the case of a negotiable bill of exchange, drawn in Massachusetts on England, indorsed in New York, and again by the first indorsee in Pennsylvania, and by the second in >Laryland, and the bill is dishonoured ; and he asks what damages will the holder be entitled to, the law as to damages in these States being different ; and he replies that in each case the kx ioci contractus is to govern. The drawer is liable on the bill according to the law of the place where the bill was drawn, and the succi ssive indorsers are liable on the bill according to the law of the place of their indorsement, every indorsement being treated as a new and substantive contract. .And again, in Sec. 315, he says, " It has sometimes 'Court V. Scott, 32 C r. 148. 'Marseilles lixtension Railway and Land Company, in n' Small- pages and Brandon's Cases, 30 Cn. D yjH. Conflict of Laws. 133 ace been suggested that this doctrine is a departure from the rule Sec. 71. that the law of the place of payment is to govern. But, cor- rectly considered, it is entirely in conformity with the rule. The drawer and indorsers do not contract to pay the money ill the foreign place on which the bill is drawn ; but only to guarantee its acceptance and payment in that place by the drawee ; and, in default of such payment, they agree, upon due notice, to reimburse the holder in principal and damages at the place where they respectively entered into the con- tract.'" Provided that — ( I ). Where a bill is issued out of Canada, it Proviso, is not invahd by reason only that it is not stamped in accordance with the law of the place of issue. Our courts do not concern themselves with the revenue laws of foreign countries.- (2). Where a bill, issued out of Canada, con- forms, as regards requisites in form, to the law of Canada, it may, for the purpose of enforcing payment thereof, be treated as valid as between all persons who negotiate, hold or become par- ties to it in Canada. The effect of this is that /> n'//i a /(la'c the law of the foreign state, as to recjuisites in form, will be assumed to be the same as our own until the contrary is shown.' If the law was shown to be otherwise, then the rule laid down in sub-section (a), ante, would govern. •Cloyes 7'. Chapman, 27 C.P. 22, at pp. 29, 30 ; Gibbs v. Fremont 9 Kxch. 25 ; Story r. McKay, 15 O.R 1O9. ■^Jarnes?'. Catherwood, 3 Dowl. & Ky. 190; liristow v Sequeville. 5 Kxch 275. "Toponce r. Martin, 38 U.C.K. 411. !:HI ■.; i il 134 Bills of Exchange Act, 1890. See 71. ! Drawing;, in (lorsemeni, etc. Proviso. This subsection relates to mere extrinsic formalities ; but it would likewise still be competent for the party liable, to show that there was some latent vice. So where a bill, drawn by a Canadian, while temporarily in New York, on merchants in Toronto, was protested for non-acceptance, upon its being shown that it had been given for a debt due in respect of certain gambling transactions on the New York Stock Exchange, and that, as such, it was, under the law of New York, an illegal contract and invalid ; it was held in an action by the payees against the drawer that the plaintiffs could not recover.' The rule is otherwise where the bill is drawn and accepted here.- Where there is no evidence to the contrary the law of the foreign country is assumed to be the same as our own ; therefore where a note had been given in Utah for compounding a felony, and there was no evidence that such a consideration was valid there, the note was held invalid here.' Where the defence is that the note is void by tlie /t\ loci contractus and the latter differs from our law it should be pleaded.'' (<5) Subject to the provisions of this Act, the interpretation of the drawing, indorsement, ac- ceptance or acceptance supra protest of a bill, is determined by the law of the place where such contract is made : Provided, that where an inland bill is indorsed in a foreign country, the indorsement shall, as regards the payer, be interpreted according to the law of Canada. The provisions referred to are this section. sub-sections (/) and {e) of 'Story V. McKay, 15 O.R. iCg. »Hank ofToronto ;•. McDoiif,'all, 2S C P. 345. •'Toponce 3'. Martin, 38 U.C K. 411. *Hope ?'. C.ild\vell,2i C.I'. 241 ; Robertson v. Caldwell, 31 U.C.R. 402. Conflict of Laws. 135 A bill of exchange drawn in England and payable in Sec. 71. Spain, was indorsed in England by the defendant to the plaintiff, who indorsed it to M., residing in Spain. Accept- ance having been refused, a delay of twelve days occurred before M. wrote to inform the plaintiff of the dishonour. On receipt from M. of the notice of dishonour, the plaintiff gave immediate notice to the defendant. No notice of dishonour by non-acceptance is required by the law of Spain. It was held that the plaintiff was entitled to recover the amount of the bill.' (c) The duties of the holder with respect to Duties of ^ ' * holder. presentment for acceptance or payment and the necessity for or sufficiency of a prote.st or notice of dishonour, or otherwise, are determined by the law of the place where the act is done or the bill is dishonoured. Therefore if a bill drawn here and payable abroad is dishonoured there and notice of dishonour given according to the laws of that country, it is sufficient, although such notice is not according to our law. {(/) Where a bill is drawn out of but payable currency. in Canada, and the sum payable is not expressed in the currency of Canada, the amount shall, in the absence of some e.xpress stipulation, be cal- culated according to the rate of exchange for sight drafts at the place of payment on the day the bill is payable. The practice of bankers in Canada with regard to sterling drafts has been heretofore, in the absence of any .stipulation 'HorneJ^ Kouquette, 3Q.B.D. 514. ''Ilirschfield v. Smith, L.R. 1 C.P. 340; Home v. Romjuette, 3 g.B.D. 514 ; Rothschild v. Currie, g.U. 43. Sec. 71. Due ro tanto, of his balance at his banker's.-' See also the next sub-section and Sec. 53, auk. ii'sion^w'°" (2)- Except as otherwise provided in this part, apply jj^^, provisions of this Act applicable to a bill of exchange payable on demand apply to a checjue. Irrespective of the general understanding upon this subject before this Act, a cheque, being a bill payal)lc on demand, would not rc(iuire to be presented for acceptance. Sec. 39, and would not bear days of grace. Sec. 14 ( i ). Apart from the provisions contained in the next and the following section, which distinguish cheques from bills of exchange, there are other distinctions which arise from the relations existing between customers and their bankers. 'Keanej'. Heard, S C.I3.N.S., Sec. 372; McLean v. Clydesdale Banking Co., 9 App. Cas. 95. 'Hopkinson v. Forster, L R. 19 Eq 74 ; Caldwell v. Merchants' Bank, 2O C.P. 294. CiiKQUEs ON A Bank. 139 A bank having funds is bound to pay its customer's Sec. 73. chetiue.' There is an implied contract between tliem to this effect. But where a banker refused to honour a cheque, on the ground that a breach of trust was contemplated by the drawer to his the banker's knowledge, he was held to be justified in so doing," As a checjue need not be accepted, if payment is refused, the holder cannot enforce payment from the l)ank, as there is no privity between them. This is subject to two exceptions : where the holder by reason of delay loses his remedy against the drawer and becomes a creditor of the bank to the extent that the drawer is dis- charged, see next section (a) and (<) ; and where, under Sec. 79, a l)ank improperly pays a crossed checjue and becomes liable to the true owner for any loss he sustains. A checjue operates as payment until it has been presented and payment refused ; ' but if payment is stopped the debt instantly revives.^ Presentment and notice of dishonour are just as necessary in the case of cheques as of bills, in order to render the drawer and prior indorsers liable, see Sec. 45 (i), a»/e.^ It was held in England before the Act that notice of dis- honour would be excused if there was no reasonable expec- tation that the cheijue would be paid,^ but now, see Sec. 46 (2). *Marzetti v. Williams, i B. & Ad. 415 ; Rolin v. Steward, 14 C.B. s wlii( h sut:h vir.iwer or person is dischari;<'d. shall he .1 cre(litor, in lieu ol such dr,iwer or person, ol such li.mk to the e.xient ol such disch,u|L;c,.uid entitled to r(;cov I '/<■., C.r/'. (11, .S, I . ;•./ ) In the !iM|Mii.il .\(| llic wold "li.iiikii ' is iistd instiMtl tit " li.m', " III uiM .\<'|, 'I'll is st( iKiii 1 , 1,1 w law. I' I II Mil \\\ till hdldci uj a i iuinit w.is III v.cnri.ii linniitl In |ii III) .III \ llir lioldi'i ai^.iina llic ili.inci, llial il was not lursiiiUd williin a icasuM.ilili' liiiic, nnlfss llic liinil liatl liccii Insl li\ llir Ali\.iiiil(i . . i'liiii liticlil, M A ( i. iii'ii CiiKiturs (IN A Hank. 141 ili'l.iv, ns l)\ liiiliiiv ul tlu- l);mkor ;' ami llu- (iiawcr irinaiiu'd Sees. 73, h.ililc upon it imlil si\ yi'ars liad elapsed. 15)' llic railiiirct ''♦' ihc liank tiiL" drawn- was al)st)liiti'ly discliarucd, liiil still was entitled to rank upon the estati- of tlie banker lor ilu- lull amount ol his elaini. llnder this si'< tion the holder lieeones A creditor lor the amount ol the ehei|ue lo the esteiu that the drawer is diseharf;i'd. The indorser ol the elu'ijui' would lie discharged ui any event, il it is not presented willun a riMsonaMc time, see See. 15 (I ), "'/A. Marking; a chci|uc ;;ood is not an acccpta ,.'c so ihal the holder c.ni sue the hink. See See. 17 (.•) as lo what consti- tutes a valid ac( I'pi.uicc. 'I'he jiayees ol a eiie(|ne took il lo llu' iiank on which it was drawn on the alternoon ol the day on w im h ihev ri( i i\ ed il IriMn the drawer and };ol il marked "fMiod, ihe amount liiiiii; charged to llu- diiwcr's accoiml. 'riiey then look it away withoul demandn |>,i\uicnl. The liank, on ihcevi'ii ini; • .lied hy — (if) ("otiiitcrniand of payiiKiit ; (/') Notice ol llic (ii.sloiiK r's ticalii. (fiiifui ill/ Alt ./•,- iiiiil fO !'/(., ('((/'. ('!/, .s', I . -1.) ' 1 Icvuniiil ," riikcrip);, I, l\ m <'.!'•. ;.'>^. K'^liinMiil ;■ Ji.twKs lord, ii<.,> i'. s-! ; ^'"rl"' .' Noiliiii, .• M A K. |ni ; |:|,ulacy ,••. M. Cil.,., Id A. Iv. .'il'i ■'I..IWS V K'.md. t <■ I'-.N S, 1 (.•. T.nV.J ,' N.lMllllll. !•/ ( ».l\ |n. It '? I ;| Wt: I i ! ;!^i I i i ; |t| m 142 Bills of Excmangl Act, 1890. Sec. 74. Altliough the authority of the hank to pay the cheque is terminated, that does not, of course, disciiarge the drawer's hai)ihty, nor that of his estate, in the event of his deatli, to the payee or to a holder in due course ;' nor the HabiHty of the indorsers if they have been duly notified of the dishonour. The holder would he entitled to recover in an action ujjon the ( hetpie against these parties, or if the payee was plaintiff lie might recover upon die consideration in an action against the drawer.' CROSSED CHKQUES. 'I'he provision with regard to c rossed chetiues is new ui this country, hut as it is not compulsory, it cannot he said, in one sense, to make a ciiange in die law. 'i"lie practice was in vogue in (heat UrUain before the .Act, or before any legis lative recognition of it at all, and prevails in most other countries, except the United States. It has, indeed, l)een in use to a limited e.xtent in ( "anada, especially in the ease of Canadian banks issuing che<|ues payable in iMigland. It is ii ( onvenient |)rovisioii by \vhi( h the addition pre- scribed by the Ai t i)Ut on the face of a < hecpie will inform the holder how it can be cashed. The principle is that a crossed checpii' must be presented to the bank upon wlii( ii it is drawn through another bank, except in the case where the payee is a customer of such bank, when, it is submitted, it must be pa.ssed through his account ; for in no case should money be paid over the counter on a crossed che(|ue. 'McLean r Clydesilale MankinR Co., q App. Cas r)<; ; per Ld. Hlnckl)iirii |i n I. ■'tc.hcn V. Un\c. \ n.H.I>. jjr. "Scu \i) &. 20 Vic, Cap. 25 (Imp.) ; 20 iV: 21 Vic, Cap. y.) (Ir.^p. 1. CROSSKH CllKQUlOS. 143 This Act does not in express terms define ///(■ effect of crossing a che(|ue, as did the Enghsh Act, 19 and 20 Vic, Cap. 25. The last-mentioned Act was repealed by 39 and 40 Vic, Cap. 81, and was not in force at the time of the passing of the Knglish " Hills of Exchange Act, 1S82," hut it may still he referred to tor its definition. It had enacted that crossing a che that they will he cuniined almost entirely to the 'settling of commercial actrounts. The advantage of crossed che([ue'. to the drawer will be that subject to his !i?.ving funds, ine giving of one will bC; for a'l practiiM.s <)!• I^\( iian(;k Act, i8yo. Sec. 75. The crossing does not restrain the negotiability.' Its only effect is lliat wlien at last the clKHjue conies for i>ayniem, it must be i-re.'iented throiigli a l)ank, f)r if crossed si)e<:iallv, through tlie hank to which it is specially crossed, see Sec. 7S (2),/-,'./. (..mr.i 7,1>, ( I ). Where ;i chcKiLic hears acro.s.s it.s face rrossiiiH «lc - jiiK.1. jjp additiosi of — (a) The word " hank " hi;t\veen two parallel transverse lines, either with or without the words " not nej^olial !e; " or — • {/f) 'rwoi)aralIel transverse lines simply, either with or without the words "not negotiable;" That addition constitutes a crossing, an'j the cheque is crossed generally. 1! If ij 11 ij *«: 1 ^ iJ-.^ (Iiiif'ii-idl Ail /) iiiid ./6 Id., Cd/". 61^ Sn . :6.) In th? Imperial Act, in lieu of the word " liank " the words "and (cmpany or any aiilireviatitm thereof "' are used, as jirivate hankers are mcluded in the dethiilion of "hanker'' in that .Act : whereas our ilefmilion of "hank" is limitcil to <'harteretl institutions, .Sei". 2 (, ) ir///i: See also "The Hank Act," 5.; \'ic.. Cap. \\, Sees, 2 (. ^^ Si Cross LP Cmx^ULs. 145 Its llCIlt, iailv, Sec. acc ILT IJy drawing across its f;ice — (rt) two parallel transverse lines simply ; Sees. 7S (/') two parallel transverse lines with the ^ ' word "hank " between them ; (c) two parallel transvcrs;i lines with the words " not negotiable " between them ; (d) two parallel transverse lines with the words "bank not negotiable " between them. As to the eflect of " not negotiable," see, />(>s/, Sec. 80. .\ checjuo whirl, nas been crossed may be uncrossed by the drawer, see See. 7O (7). No other person can uncross it, and lo make any change is a material alteration, Sec. 77 ; ami avoids the cluipic. see Sec. (\]. (2). Where a cheiiue l)ears across its face an sp.ri,.i additicMi of tlie name of a hank, either with or without the words " not negotiable," that ad- dition constitutes a crossiny^, and the checjue is crossed specially and to that hank. -H In this and tlu' followuig sections where the word " bank " is used in our .\cl. "banker'" is used in the Knglish Act. 'I'he last sub-section having defined a general crossing, this defines a special crossing. A special crossing is effected by writing the name of a |)artii ular bank in the instances (/>) or (r/) put in the notes to the [)receding sub-si-ciion, instead of the word *' bank " merely. This is usually done at the recpiesl of the drawi-e, where he intends to deposit the cheiiue to his credit in the bank to which it is crossed specially and of which he is a customer. 70. (i)- A checjne may he cros.sed generally ,^;^*^;;'«,'''' or specially hy the drawer. ■'""''^'"" 1 ^ !) I < ,' ! ^^1 ii I ] I I i! : 146 Hills of Exchanck A( t, 1S90. Sec. 76. {hnper'tal Act 45 and 46 Vic, Cap. 61, Sec. 77.) As to the distinction between general and special crossing, see the preceding section. fpeciai'.' °' (2). Where a cheque is uncrossed, the holder may cross it generally or specially: JlrLlr (3)- Where a che(|ue is crossed generally, the holder may cross it specially: b^°idcitT^ (4). Where a checjue is crossed generally or specially, the holder may add the words " not negotiable." The drawer may, in the first instance, iross tlie cheque in any of the four modes mentioned in Sec. 75, or he may cross it specially. If he omits to cross it, the holder may cross it either generally or specially. If the ilrawer crosses it gener- ally, the holder may cross it specially: he could do so hy filling the blank, .Sec 20 (1) and Sec. 77. In any of tiie above cases the holder may add the words " not negotiable.' ' fnrcoi'rrc"" ( 5 )• Where a cher|U(; is cro.ssed specially the """ bank to which it is crossed may again cross it specially, to another bank for collection. A bank might re(|UHe to do this where it could not |)re- sent the cheque (lire<-tly to the bank upon which it is drawn, e.f^. where the latter was in a iliffereiU town. crossini; by ifA Where an imcrosst;d cheiuie, or a. ch(.'ntie bank. ^ ' i ' 1 crossed generally, is sent to a bank for colka:- tion, it may cross it specially to itsell. This might be done by a bank to jirevent possible frauds by its own employees. Cross p:n Cheques. H7 (7). A crossed cheque may be reopened or Sees. 76, uncrossed by the drawer writintj between the ,, — . ' c5 I'licrossir 'ncrossiiig transverse lines, and initialling the same, the H^i^l words " pay cash." This subsection is not in the Iin[)erial Act. hut accords with mercantile |)r.ictice in iMigland. Where a drawer re- opened or uncrossed tlie cheque, ii would probably be .at the instanc'.' of the holder, who anticipated or experienced diffi- culty in getting it cashed. 'I'hore is no provision for reopen- ing or uncrossing a checjue, by an indorser. who has himsel^ crossed it. 77. A crossintj: authorized by this Act is a^-'"-''"Pjs material part of the checjue; it shall not be law- ^heliue. tu! for any person to obliterate; or, except as authorized by this .Act, to add to or alter the crossing. (Iiii/>iri(il Act ./f iiiui 46 I'/c, Of/". 61, Sic. /iriti/ Ait 4j and 46 lie, Cap. 61, Sir. /y.) ' Mell.imy r Marjuribanks, 7 I'^xih jh«j ; Carlon v. Irelaiui, 5 ■^Simmons d, Taylor, 4 C.B.N.S. 463. >l , I4« Hii.Ls OF Fx('n.\Nt;K Act, 1890. Sec. 78. In the Imperial Act the words "an agent for collection being a hanker" arc used instead of the words in brackets. All the sections of this part were transcribed into the Imperial Act from y) and 40 Vic, (!a|). 81. This latter statute is said to have been passed in conseciuence of a decision that where a chetjue had been specially crossed ami had been paid through a bank other than the one to which it was so specially crossed, the paying bank was not liable in an action at the suit of the party from whom it had been stolen.' Il|>ln| |i:iyiiic III i.iai.iiiivt.., (2). Where tlui hank on which a ch(;(|iie so iiiii>iiii" I ^ ' ' cross(nl i.s drawn, n(;v(M-lh('lc.s.s pay.s the; saim-, or pays a ch('(|iic crossed g{;nerally otherwise than to a l)ank, or, if crossed specially, other- wise; than to th(; liank to which it is cros.sed, or (to the hank actinj^ as its aL;;ent for collection, it) is liahle to the true owner of the checpie for any loss he sustains owinij to thitchecjue havinij h(;en so paiil. In the lini)erial Act the words "his agent for collection being a banker, he'' are used instead of the words in brackets. 'I'liis sub siction meets the case which was the subjec t of litigation in Smith t. L'nion l>ank iu/'/ii, and the paying bank would now. under similar circumstances, be liiible to the true owner. It seems, however, that this is miTcly an additional ri-medy against the bank and not in substitution o( the rigiil of recourse against the bank that llic drawer has in any case, whether the ciie(|ue be crossid or not, and of repudiating its i»ayment if it has iiccn paid on a forged indorsement. If the clu'iiue was |)ayalilc to bearer, or stoUn 'Smith 7' I'liinii H;ink of I.umlon, i (,_).!! !• ji, -noljl)otl !'. I'inkett, i Ivscli D j(.,S collcclion brackets. d into the riiis latter H'lice of ;l rosscd and • to which ot liable in had been U'(|ll(! so Hi sanu', thcrwisc y, othcr- osscd, or .'clion, il) l: for any cnllection \v«)rds in .• siibje( t of the paying ic luible to ini'rtly an .iibslilulion drawer has not, and of 111 a forged ir, or stolen Ckosski) Cm:()UKs. 149 after it had been indorsed in blank by the payee, there is no Sec. 78. remedy apart from this section unless the cheque is crossed " not negotiable ;"' and see Sec. 80. IVoviilcd, that where a checjuc is presented ,^',i','y",'H.'s for payment which does not at the time of pre- ""'•''^^""'• sentment appear to be crossed, or to have had a crossing which has been obliterated, or to have l)een added to or alteretl otherwise than as authorized by this Act, the bank paying the cheque in good faith and without negligence shall not In: responsible or incur any liability, nor shall th(^ payment b(; (juesiioned by reason of the cheqiu; having been crossed, or of the crossing having been obliterat(;d or having been added to or altered otherwise than as authorized by this Act, and of payment having been matle otherwise than lo a bank or to the bank to which the che(|ue is or was crossed, (or to the bank acting as its agtMit for collection,) as the case may be. The words in brackets are not in the Imperial Act, but in lieu thereof "his agent for collet tion being a banker." This provision relieves the paying bank where the cross- ing has been dealt with in contravention of the provisions of Sec. 77 if theieare />onn Jidt-s ar.d an absence of negligence. I'he fact of obliteration of itself, or any alteration apparent in the crossing, would be a circumstance from which, as a fact, negligence might be inferred. 'ClialnuTs on Kills, p i^o. •'Carloii ?• Inland, 5 1^. cV M 765 m I50 Hills ok ExchangI'; Act, 1S90. 'n:,d > ?,) to drawer where cheque is crossed. Sec^. 79, Where the bank, on which a crossed '''bank'"mi checjue is ilravvn, in good faith and without negli- gence pays it, if crossed generally, to a hank, or, if crossed specially, to the bank to which it is crossed, or to a bank acting as its agent lor collection, the bank paying the cheque, and if the che(|ue has come into the hantlsot the payt^e, the drawer, shall respectively be entitled to the same rights and i)e placetl in the same position as if payment of the checjue had been made to the true o\vn(;r thereof. (Iiiipiritil All t/i (I ltd 46 Vic, Clip. 61, Six. So.) 'IMiis scrtion oxcmplilk's iIil (.;rcat a(ivant;ij.'c to hanks in till' system of crossing chuciiics. It was originally designed for the henefit of the holder only.' This section gives ahso- hite protection to the hank, notwithstanding that the indorse- ment may have hecn forged. I'he drawer is only relieved if the chei|iie (an he traced into the hands of the payee, hut the hank in any case if acting hoiia Jidt\ If the payee's name has heen forged on a chei|iie payahle to order, after it has come into his hands, tin- loss will fall upon him ; or if it has not come into his hantls, on the drawer : and their remedy re.s|)ectively will only he against the person who improperly received the money. The true owner, in general, has no remedy against 'he hank through which the che(|ue was pre- sented, Sec. Si. If the hank on which a che(iue is drawn fails, the hank presenting it may recover hack the money j)aid upon it,' and the same rule will apply even though the cheipii' is drawn upon one of its hranches and made ^)ayahle at [)ar at the former, if it is .suhseijuenlly dishonoured.^ 'Hell.-iniy ;■ M.irjoril).inks, 7 l^xili. jSi), per I'.irk-j H .(oj. ■■ORdon ?'. Menas, L H. (j 1'. 51 j. ^'Woodland j'. I'e.ir, 7 V.. Ik H. snj, Timtnins ;•. (;il)l)ons, iH Q.B. 7«. ■'Rose- Bel ford Printing Co. -■. Mank of Montreal, 12 () R. j.jt ; Owens V Quebec M.ink, 30 II CK, jSj ; I'rince v. Orient.il H.mk Corporation, j App. Cas 325. Crossed Ciie(^ues. '5« rossing on liulder. SO. Where a person takes a crossed cheque Sect. 80, which bears on it the words " not nej^otiable," p^^— , he shall not have and shall not be capable of i, giving a better title to the cheque than that which had the person from whom he took it. {Iinpii-itil Act 4^ ami 46 Vic, Cap. 6/, Sec. S/.) The Imperial A) A V)ank holiday under the Bank Holidays Act 187 1, or Acts amending it ; (c) A day appointed by royal proclama- tion as a public fast or Thanksgiving Day." This section is new. *■ 9a. For the purposes of this Act, where a bill i^ungis I I I . , . equivalent or note is required to be protested within a to protest. specified time or before some further proceeding is taken, it is sufficient that the bill (or note) has been noted for protest before the expiration of 'Armstrong v. Township of Garafraxa, 44 U.C.R. 515. !,■'■ mi n :: !:''ill ill 164 BiiT.s OF Exchange Act, 1890. Sees. 92, the specified time or the taking of the proceed- ing ; and the formal protest may be extended at any time thereafter as of the date of the noting. (^Imperial Act 45 and 46 Vic, Cap. 61, Sec. pj.) The words in brackets are omitted in the Imperial Act. This is new. The object of tliis section is to show that by the use of the word "protesting" it is not intended that the extension should be necessary. It may be drawn up at the notary's leisure. Thus where a bill is accepted or paid supra protest, the bill must be protested before the accept- ance or payment as the case may be, sec a//fe, Sees. 64, 67 : but it is sufficient if the bill be merely noted, the protest may be drawn up or extended afterwards : ' even after the com- mencement of an action. - The protest when drawn up is prima fade evidence of presentation and of dishonour, and of the service of the notice thereof, as stated in such protest, Sec. 93 (5). Protest when notary is not acces- sible. 93. (i). Where a dishonoured bill is author- ised or required to be protested, and the ser- vices of a notary cannot be obtained at the place where the bill is dishonoured, any (justice ol the peace resident in the place may present and pro- test such bill and give all necessary notices, and shall have all the necessary powers of a notary in respect thereto). {Imperial Act 4^ and 46 Vic., Cap. 6/, Sec. ^4.) In the Imperial Act after the word " bill " in tiie first lint " or note " is inserted, and instead of the words in brackets, the following words occur, " householder or substantial resi- 'Geralopulo v. Wider, 10 C.B. 6go. ^Ibid. SUPPLKMENTARY, 165 dent of the place may, in the presence of two witnesses, give a Sec. 93. certificate, signed by them, attesting the dishonour of the bill, and the certificate shall in all respects operate as if it were a formal protest of the bill." This section is new. The provision is taken from the code of Quebec. The justice of the peace could probably be called upon to do this merely as matter of favour, .see notes to sub-section 3, post. Although the section omits all reference to promissory notes, it seems clear, by force of Sec. 88, that the provision would apply to them. See also sub-section {s), post, where it is assumed to apply to them. (2). The expense of noting and protesting Expenses, any bill or note, and the postages thereby in- curred, shall be allowed and paid to the holder in addition to any interest thereon. This sub-section is not in the Imperial Act. (3). Notaries may charge the fees in each ^^1*^^^^^^ Province heretofore allowed them. i This sub-section is not in the Imperial Act. There is no provision for payment of fees to a justice of the peace when he protests a bill under Sec. 93 It may well be doubted whether such fees, therefore, as may be paid to him will be collectible under sub-section 2, ante. These fees in the Provinces of Ontario, Nova Scotia and Prince Edward Island, are fifty cents for the protest and twenty-live cents for each notice and the necessary postage, R.S.C., Cap. 123, Sec, 25. There is no separate fee for noting. In the Province of Quebec, the fees are much higher, see RS.C, Cap. 123, Sec. 28 and Schedule B. to that Act. The fees in New Brunswick are regulated by a Provincial Statute. i o II* I !!■■ If f I \i- 0. ' 'if k ■ j: .1 K^^ II' 1 66 Bills of Exchangk Act, 1890. Sec. 93. Forms. (4). The forms in the first schedule to this Act may be used in noting or protesting any bill or note and in giving notice thereof. A copy of the bill or note and indorsement may be included in the forms, or the original bill or note may be annexed and the necessary changes in that be- half made in the forms: prM*im-'°^ (5). A protest of any bill or note, and any honS;?and copy thereof as copied by the notary or justice of the peace, shall, in any action \i^ prima facie evidence of presentation and dishonour, and also of service of notice of such presentation and dis- honour as stated in such protest. These sub-sections are not in the Imperial Act. See also Rev. Stat. Ont. 1887, Cap. 6r, Sees. 31, 32 and 33. A protest is only prima facie evidence : therefore if the facts as stated in such protest or any of them were disputed, it would be necessary to prove them by oral testimony in the usual way." Dividend warrants may be crossed 94. The provisions of this Act as to crossed cheques shall apply to a warrant for payment of dividend. (Imperial Act 45 and 46 Vic, Cap. 61, Sec. pj.) This section was introduced into the Imperial Act from 39 and 40 Vic, Cap. 81, Sec. 3, which applied only to the dividend warrants of the Bank of England and Bank of Ireland. 'Merchants' Bank v. McDougall, 30 C.P. 236 ; see also Southam V. Ranton, g A.R. 530; Fitch v. Kelly, 44 U.C.R. 578. Supplementary. 167 this bill y of ded Y be be- The present enactment applies to all bank dividend Sees. 94, warrants. '^' As to the provisions relating to crossed cheques, see ante, Sees. 75-81. 95. ( I ). The enactments mentioned in the Repeal, second schedule :o this Act are hereby repealed, as from the commencement of this Act, to the extent in that schedule mentioned: Provided, that such appeal shall not affect.Pi^ov'so- anything done or suffered, or any right, title or interest acquired or accrued before the com- mencement of this Act, or any legal proceeding or remedy in respect of any such thing, right, title or interest. {Imperial Act 45 and 46 Vic, Cap. 61, Sec. ^ ' ) The Imperial Statutes relating to Bills and Notes e.g. such statutes as 3 and 4 Anne, Cap. 9, in force in the several Provinces of Canada are not repealed. Perhaps this was an oversight. (2). Nothing in this Act or in any repeal 3?n^t"'' effected thereby shall affect the provisions of **'^^*^'^^" " The Bni.k Act." Not in the Imperial Act. " The Bank Act " in force after 1st July, 1891, will be 53 Vic, Cap. 31, which repeals R.S.C. Cap 120, and amending Acts. ( i). The Act of the Parliament of Great imperial ^^' ^ Acts IS Geo. Britain passed in the fifteenth year of the reign "na'^^clo.' of His late Majesty George III., intituled "Annot'toK: Act to restrain the negotiation of Promissory ■ .1 ■ 1' Pi 1 68 Bills of Exchange Act, 1890. Sees. 95* Notes and Inland Bills of Exchange under a 90, 97* - limited sum within that part of Great Britain called England," and the Act of the said Parlia- ment passed in the seventeenth year of His said Majesty's reign, intituled " An Act for further restraining the negotiation of Promissory Notes and Inland Bills of Exchange under a limited sum within that part of Great Britain called England," shall not extend to or be in force in any Province of Canada, nor shall the s?id Acts make void any bills, notes, drafts or orders which have been or may be made or uttered therein. Not in the Imperial Act. Taken from R.S.C., Cap. 123, Sec. 26. The Acts referred to are repealed in England, 15 Geo. III., Cap. 51, by 48 Geo. III., Cap. 88, Sec. i,and 17 Geo. III., Cap, 30, by 45 and 46 Vic, Cap. 61, Sec. 96, and were passed to restrict the negotiating of promissory notes and inland bills of exchange for less than twenty shillings origin- ally, but afterwards extended to five pounds. Construc- tion with 96, Where any Act or document refers to any other Acts enactment repealed by this Act, the Act or docu- ment shall be construed and shall operate as if it referred to the corresponding provisions of this Act. (Imperial Act 43 and 4.6 Vic, Cap. 61, Sec. gg.) Commence- 97, This Act shall come into force on the ment of Act first day of September next. This Act, it is submitted, will not apply to rights acquired under bills or notes drawn, accepted or made before the first Supplementary. 169 day of September 1890;' nor to acts done before that Sec. 97. date, since no retroactive effect is to be attributed to new laws, nor do they affect or interfere with rights already acquired. = Nova constitutio futuris Formam imponere debet, non pneteritis? The principle of this maxim is one of such obvious convenience and justice that it must always be adhered to in the construction of statutes, unless in cases where there is something on the face of the enactment put- ting it beyond doubt that the Legislature meant it to operate retrospectively.'' It is likewise submitted the Act will not apply to the transference or indorsement of bills or notes after the first day of September if made before ; but will govern matters of procedure.^ But even in cases where the enactments of the Act do not apply, they may still be looked to, for the most part, as evidence of what was the general understanding before it was passed, and of what the law was upon the subject.* See also our Interpretation Act, R.S.C., Cap. i. Sec. 57, and proviso to section 95, ante. iMcLean v. Clydesdale Banking Co., 9 App. Cas. 95, per Ld. Dlackburn p. 105 ; see also Commercial Bank of Canada v. Harris, 26 U.C.R. 594 'Savigny's International Law, Sec. XLL, p. 280. 32 inst., 292 Bac. Abr. Statute (c). *Moon V. Burden, 2 Exch. 22; 12 Jur. 138 ; Dash v. Van Kieeck, 7 Johns R. 503. "Savginy's International Law, p. 281 ; see also Bank of Montreal V. Scott,''i7 C.P. 358, per A. Wilson, J., at p. 363. « McLean v. Clydesdale Banking Co., 9 App. Cas. 95, per Ld. Blackburn, p. 106. 4 idfi fi;; 'i 1' n J 'Si I 1 'I ll!f 'I '^ ILiL - ^ I Forms. 171 Form A. FIRST SCHEDULE. Form A. NOTING FOR NON-ACCEPTANCE. (Copy of Bill and Indorsements.) Qn the 18 , the above bill was, by me, at the request of , presented for acceptance to E. F. , the drawee, personally [or, at his residence, office or usual place of business), in the city (town or village) of and I received for answer, " " ; The said bl'l is therefore noted for non-acceptance. (Date and Place.) A. B., Notary Public. , ( A. B., \ Due notice of the above was by me served upon | c. D., f th^ \ fndSr, I Pe'^«o"a»y' °" ^^e day of {or, at his residence, office or usual place of business) in , on the day of (or, by depositing such notice, directed to him, at , in Her Majesty's post-office in the city [town or village], on the day of , and prepaying the postage thereon.) {Date and Place.) t8 A. B., Notary Public. Form B. 172 Bills of Exchange Act, 1890. Form B. I t ( PROTEST FOR NON-ACCEPTANCE OR FOR NON- PAYMENT OF A HILL PAYABLE GENERALLY. {Copy of Bill and Indorsements.) w fw. h\'. On this day of , in the year i8 , I, A B., Notary Public for the Province of , dwelling at , in the Province of , at the retjuest of , did exhibit the original bill of exchange, whereof a true copy is above written, unto E. F.,the-| ' '^^^^^ I * -^ ' [ acceptor J thereof personally (or, at his residence, office or usual place of business) in , and, speaking to himself (or his wife, his clerk, or his servant, &c.,)did demand j^'J^'^.^Pj^j"*^'^ j- thereof ; unto which demand j,!- answered : '* ." Wherefore I, the said notary, at the request aforesaid, have protested, and by these presents do protest against the acceptor, drawer and indorsers (or drawer and indorsers) of the said bill, and other parties thereto or therein concerned, for all exchange, re-exchange, and all costs, damages and interest, present and to come, for want of-j 't^^^ nt ^^ f °^ ^^® said bill. All of which I attest by my signature. (Protested in duplicate.) A.B., Notary Public. L Forms 173 Form C. Form C. PROTEST FOR NON-ACCEPTANCE OR FOR NON- PAYMENT OF A BILL PAYABLE AT A STATED PLACE. (Copy of Bill and Indorsements.) On this day of , in the year 18 , I, A. B., notary public for the Province of , dwelling at , in the Province of , at the request of , did exhibit the original bill of exchange, 1 -li i. 1- 1- ii ( drawee 1 whereof a true copy is above written, unto K. t. the|^^^^gp^yj.| thereof at » being the stated place where the said bill is payable, and there, speaking to did demand {paymenr''}''^ **''' '''"' ''^" ' ""*" '^^'''^ demand he answered : " Wherefore I, the said notary, at the request aforesaid, have protested, and by these presents do protest against the acceptor, drawer and indorsers (or drawer and indorsers) of the said bill, and all other parties thereto or therein concerned, for all exchange, re-exchange, costs, damages and interest, present and to come, for want of{p^y^'f'gf^"'^''}of the said bill. All of which I attest by my signature. (Protested in duplicate.) A. B., \otary Public, k ! M 174 Bills of Exchange Act, 1890 Form D. Form D. PROTEST FOR NON-PAYMENT OF A BILL NOTED, BUT NOT PROTESTED, FOR NON-ACCEPTANCE. 11. £• If ;• M If the protest is made by the same notary who noted the bill it should immediately follow the act of noting and memorandum of service thereof, and begin with the words " and afterwards on, &c.," continuing as in the last preceding form, but introducing between the words "did " and " exhibit," the word " again," and in a parenthesis, between the words "written" and "unto," the words: "and which bill was by me duly noted for non-accept- ance on the day of " But if the protest is not made by the same notary, then it should follow a cofyy of the original bill and indorsements and noting marked on the bill — and then in the protest introduce, in a parenthesis, between the words "written" and "unto," the words : " and which bill was on the day of , by , notary public for the Province of , noted for non-acceptance, as appears by his note thereof marked on the said bill." Forms. 175 Form E. Form E. PROTEST FOR NON-PAYMENT OF A NOTE PAYABLE GENERALLY. (Copy of Note and Indorsements.) On this day of , in the year i8 ,1 A.B., notary public for the Province of , dwelling at , in the Province of , at the request of , did exhibit the original promissory note, whereof a true copy is above written, unto , the promisor, personally (or, at his residence, office or usual place of business), in , and speaking to himself (or his wife, his clerk or his servant, &c.), did demand payment thereof ; unto which demand j ^^^ ^ answered : " Wherefore I, the said notary, at the request aforesaid, have protested, and by these presents do protest against the promisor and indorsers of the said note, and all other parties thereto or therein concerned, for all costs, damages and interest, present and to come, for want of payment of the said note. M mt All of which I attest by my signature. (Protested in duplicate.) A. B., Notary Puilic. If if 176 Hills of ExcuANdK Act, 1890. Form F. Form F. I'ROTKST FOR NON-PAYMENT OK A Nt)TE PAVABLi: AT A STATi:i) PLACE. {Cof>y of Note and Indoyscmcnts.) On tliis clay , in tlie year i8 ,1, A. I>., notary piil)lic for tlw. Province of , dwellint; at , ni the Province of , at tlic re(|iicst of , (lid cxiiibit the orif^inal promissory noti', whereof a true; copy is above written, unto the promisor, at , beinj; the stated place where the said note is payable, and there, speaking to did demand payment of the said note, unto which demand he answered : " ." Wherefore I, the said notary, at the request aforesaid, have protested, and by these presents do protest against the promisor and indorsers of the said note, and all other parties thereto or therein concerned, for all costs, damaj^es and interest, present and to come, for want of ])ayment of the said not(!. All which I attest by my signature. (Protested in duplicate.) A. B., Notiiiy I'lililic. FOKMS. ^77 Form G. Form G. NOTARIAL NOTICK OF A NOTING, OK OK A PRO- TEST FOR NON-ACCEPTANCF.OR OF A PROTEST FOR NON-PAYMENT OF A HILE. {Phut and dale a/ JVo/z'/i^' or of Protest.) ist. at To P. CJ. {the drawer.) Sir, Your bill of exchan«c for % , chittid at tht; , upon K. F., in favor of C. I)., payable alter |"i'^?^'| was this day, at the request of noted '^"'y ip;;;;;;ted } '^> .. r non-acceptance. | ,y me tor -^„o„.pay,nent. J ila\ b A. B., Sotaiy I'lihlii. {Place and dak of Noting or of Protest.) 2nd. To C. D. {indorscr), {or F. G.) at Sir, Mr. P. y.'s bill of exchange for * , dated at llic , upon E. F"., in your favor (or in favor of C. D.,) l>ayable days after {^/jj]!j 'i"J ^^y v"" indorsed, was this day, at the recjuest of duly I noted \ , ,,,„ r,,,. i non-acceptance. | \procested }''> '"'-"" \ non-payment. / A. H., Sotai-y I'lihltt. ».n li'; '11 M 2 'I I 178 Bills ok ExciiANdt: Act, 1890. Forms H, I. Form H. NOTARIAL NOTICE OF PROTEST FOR NON- PAYMENT OF A NOTE. (Place and date of Protest.) To at Sir, , dated ;it payable ■! inontlis '■ after date to I on j Mr. P. ^.'s promissory note for ft , the V V °^ order, and indorsed by you, vva^ tliis day, at tlic request of , duly protested by me for non- payment. A. B., Notary Public. Form I. NOTARIAL SERVICE OF' NOTICE OF A PROTESl FOR NON-ACCEPTANCE OR NON-PAYMENT Ol A BILL, OR OF NONPAYMENT OF A NOTE (/<> /u suhjoined to the Protest.) And afterwards, I, the aforesaid protesting notary publir did serve due notice, in the form prescribed by law, of the ,. . t t f r non-acceptance ) , .1 f bill 1 toregoiiitr protest tor ; ' , J ot the ■; , " ^ ' I non-payment | ( note ) ^1 1 i 1 I P. O. . ^ ., \ drawer 1 thereby protested upon j ^, ^^ ^ ^ the ^ indorsersj P'^' sonally, on the day of (or, at his residence, office, cr usual place of business) in , on the ilay of ; {or, by depositing such notice.directed ti> the said i .-' ^" > at , in Her Majesty's post-office in on the day of , and prepaying the postage thereon). In testimony whereof, I have, on the last mentioned day and year, at aforesaid, signed these presents. A. B., Notary Publu . Forms. 179 Form J. Form J. PROTEST BY A JUSTICE OF THE PEACE (WHERi: THERE IS NO NOTARY) FOR NON-ACCEPTANCIC OF A BILL, OR NOJ^-PAYMENT OF A BILL OR NOTE. (Copy of Bill ov Note and Indorsements.) On this day of , in the year i8 , I, N. O., one of Her Majesty's justices of the peace for the district (cr county, &c.), of ' , in the Province of , dwelling at (or near) the villaj^e of , i" the said district, there beinj; no practisiu}; notary public at or near the said village (or any other lethal cause), did, at the request of and in the presence of well known unto uie, exhibit the original { [jJJJp | whereof a true copy is above written ■ drawer i unto P. (.)., the | acceptor thereof, personally {or at his V promisor V residence, office or usual place of business) in and speaking to himself (his wife, his cler!: or his servant, &c.), did deman protested, and by these presents do protest {drawer and indorsers ^ promisor and indorsers > of the said acceptor, drawer and indorsers ) -^ '^'^ 1 and all other parties tliereto and therehi con- I note j ,,11 cerned, for all exchange, re-exchange, and all costs, damages r if (acceptance) and interest, present and to come, for want ot -j p,^y„,ent ( i- *i 1 ( ''ill- 1 All which is by these presents attested by the signature of tiie said (the witness) and by my hand and seal. (Protested in duplicate ) {Signature of the icitness.) (Signature and seal of the/. P.) A i Forms. i8i SECOND SCHEDULE, ENACTMENTS REPEALED. •KOVIN( K AND CHAl'TKK. Tril.i; Ol- ACT AND EXTENT OF REPEAL. Ooiuinion ot Canada: ^ v^rhanup and Pro- Chap, 1.3. l The other sections of this j chapter liave been heretofore repealed. ^'K:J::^r^^:;i..., ...... .,o. tof ..,., -- -;• chos^^in^Ac^^^^- I have been heretofore rei^ealed. 30 Viit., iSf.-, chap. 3t \n Act to amend chap. 116 of the Revised Stal- I'tes, " Of .Bills, Notes and Choses in Ac- tion''; also Act I2th Victoria, chapter I 39, relating thereto. Section i. , lAcept in so far as such articles, or any of then., relate to evidence in leg.ini i.> bills of exchange, che(|u. No. I. INLAND HILL OK IvXCHAXG IC. Montreal, lotli .SV/'/.. iScjo. Thirty days after sif,'lit. pay to the didcr of ourselves tlit; siiiii of five hundred dollars, value iec('i\ ed. C". n. >.\; Son. To Messrs. A. B. t^: Co.. Tonjnto. No. ijia. /J500. No. 2. FOKlilGX HILL OF i:XCHAN(ii:. ' Drawn nut of Caiuida but (buyable here. > London, ICm;., lotliOit., i.Sqo. At sixty days alter sii;lit, pay tiiis original of {'"xchan.m" (duplicate unpaid) to tiio order of A. H. & Co., five hundred |)ounds sterling, value recei\od- and eliargf to account of your letter of credit Xi>. 5S1. Union Hank oi- London, I'nC. Il.,(\islu,r. To the Hank of Hritish Xorth Aniericii, Toronto, Out. No. 140. $500. No 3. F()Ki:iC.X HILL OF KXCHANC.i:. Drdh'ii ill hut piiynh/e out of Cuiiiidu. KiNiisrov N r., 10^/; Oct.. uS()o. At thirty days after date, pay this first of I'xchange (second and third unpaid) to the order of A. H. & Co., five hundred dollars, value received, and charge to account of C. I). To'The Union Bank of London, London, I''ngland. Forms. i8- Forms 4, 5,6. No. A- PROMISSORY NOTE. % 1 ,000. London, Ont., 1st Oct., iSgo. Four months after date, 1 promise to pay to A, B., or ..rder, at the Bank of British North America here, the sum of one thousand dollars, for value received. C. D. No. 5- CHEUUl' CROSSED GENERALLY. 5150. \.1NGST( r.. The Bank of British Ncf'th Amijrica. e sum Fay A. B., or order, t dollars. N, OnT., I.S'/ Oct., 1890. of one hundred and fifty C. D. :1 No. 6. CHEOIE CROSSED SFECL\LLY. *,524. To The Bank of Hamilton ^ Pay E. F., or order, the four dollars. u. hI\milton, 1st Nov., 1S90. c o c sufft of|threc hundred and twenty G. A. & Co. I ^.■■^ ffl 184 Bills of E.\chanc;e Act, 1890. Form 7. No. 7. PROTEST FOR NON-ACCEPTANCE OF A BILL OF EXCHANGE PAYABLE GENERALLY, AND NOTA- RIAL SERVICE OF NOTICE THEREOF. On this tenth day of October, in the year 1890, I, A. B., a Notary Public for the Province of Ontario, dwelling at tht- Town of Gait, in the Province of Ontario, at the request of C. D.. did exhibit the original Bill of Exchange hereunto annexed ( unto E. F., the drawee thereof, personally J in the said Town of Gait, and speaking to him did demand acceptance thereof, to which demand he answered : ('' / have remitted funds:') Wherefore I, the said Notary, at the request aforesaid, have protested, and by these presents do protest against thi' drawer and indorser of the said bill and all other parties thereto or therein concerned for all exchange, re-exchange, and all costs, damages and interest, present and to come, foi •vant of acceptance of th(^ said bill. Ai.l. of which I attest by my signature. N'otii Ps.jCM , l'"si:iKt'.oO<', *l.oe A. B. Notary I'uhlii And afterwards l.tlie aforesaid protesting Notary Public did serve due notice, in the form prescribed by law, of the fore going protest for non-acceptance of the bill therel)y protested upon G. H., the drawer, and J. K., indorser, by depositing such notices, directed to the said G. H. and J. K. respectively, as follows, namely, to the said : Mr. G. H., Toronto, Ont. Mr. J. K., Toronto, Ont. in Her Majesty's post-office, in the said Town of Calt,on the eleventh day of October, 1890, and prepaying trie postage thereon. In testimony whereof, I have, on the last mentioned day and year, at Gait, aforesaid, signed these presents. A. B., Sittiii \- I'uhlu Forms. 185 Form 8. No. 8. PROTEST FOR NON-ACCEPTANCE OF BILL OP EXCHANGE PAYABLE AT STATED PLACE ANP NOTARIAL SERVICE OF NOTICE THEREOF. On this tenth day of September, in the year 1890, 1, A. B., ■I Notary Public for the Province of Ontario, dwelling at l ondon, in the Province of Ontario, at the request of C. D., .lid exhibit the original Bill of Exchange hereunto annexed unto (£. t., the drazver, at his usual place of business) at the said City of London, and speaking to him did demand acceptance of the said bill, unto which demand he answered : (" I do not owe the amount of the bill.") Whi-rki-ork 1, the said Notary, at the request aforesaid, have protested und by these presents do protest against the drawer and inJorser ..f the said bill, and all other parties thereto or therein concerned for all exchange, re-exchange, costs, damages and interest, present and to come, tor want ot acceptance of the said bill. Am. of which I attest by my signature. A. B., ,Vo/.. Montreal, VJi"-*- SiK. — Your Hill of Excliaiijfo for $500, dated at Montreal the 1st day of October, i.Syo, upon IC. F., in favour of (i. H., payable ten days after date, was this day, at tlic retpiest ot J K., duly protested by ine for non-acceptance. A. R, .Y(i/(icv I'lihlii . No. 14. \OTARIAI> N'OTICF TO DKAWKK OF PROTEST I'OR N()\.FAVMi:\T OF HILL. KiNosTON, Ont., 14//; October, icS()o. ToC". 1)., Montreal, Oi'e. SiK, — Your Hill of Kxclian{,'c for $500, dated at Moiitreal tlie ist (lay of October, iank 99 Is a bill of exchange 138 Payable on demand 138 Does not require acceptance 65,138 No days of grace upon 138 Bank in funds bound to pay 139 Liable to damages for refusal 139 Bank, in general, not liable to holder of 139 Operates as payment 139 Presentment and notice of dishonour of 139 Index. 199 Cheque on a Bank — Continued. page. Must be presented within a reasonable time 140 Effect of neglect to present 140 Holder of, creditor instead of drawer when 140 Effect of marking cheque " good " 141 Effect of countermand of payment of 141 Notice of customer's death 141 Crossed cheque ^42 Principle of crossing cheques 142 How payable ^43 How crossed ^44 Must not be presented through a private banker . . . . 144 Special crossing ^45 Crossing may be by drawer '45 Or by holder • •• ^46 If drawer crosses generally holder may make it special . . 146 Holder may add " not negotiable " 146 Recrossing by bank for collection • • 146 Bank may cross to itself 146 Uncrossing or reopening crossed cheques i47 Crossing a material part of U? Liability of bank for improper payment of 148 When liability does not accrue ^49 Protection to bank and drawer where cheque is crossed . . 150 Effect of " not negotiable " ^S^ Protection to collecting bank 1 5 ^ Collateral pledge does not invalidate note . . .. 153 Collateral security "9 Effect of negligence as to ^^9 Right to passes with bill or note ^53 {See Consideration) 42 Commencement of Act ^68 Conflict of Laws ^3i Rules where laws conflict ^3^ Validity of requisites in form how determined . . • • 132 Interest payable on foreign bill ^32 Revenue laws how far regarded ^33 Requisites in form presumed to be same as in Canada . . 133 Rule where consideration invalid in foreign country . . 134 P': i,j ;i i 11 i i 200 Bills of Exchange Act, 1S90. Conflict of Laws — Contintied. V\ir,v.. Drawing, etc., determined by law where contract made ,. 134 Rules as to notice of dishonour j^e Inland bill indorsed abroad i^^ Duties of holder , ^c Consideration for bill ^2 Valuable, defined 42 Antecedent debt sufficient 42 Even though bill given as collateral security for . . , . 42 Partial failure of . . 43 Must be liquidated to be a defence 43 If unliquidated how far a defence 43 Construction with other Acts 168 Contingency, bill cannot be payable on a. . . . . 19 Contract on bill not complete till delivery . , . . 32 Contribution between accommodation indorsers . . 56 Corporations 34 Capacity to become party to bill 34 Provincial charters can give power 35 Must be empowered by charter 35 Effect of indorsement by 35 Sealing by, equivalent to signing 162 Counter-claim includes action 5 Includes defence 5 Covenant not to sue uS Criminal proceedings, bill obtained by, invalid . . 4^ Crossed cheque. {See Cheque.) Currency 1 3S Bill payable in foreign currency 8,135 Current rate 136 D Damages measure of 104 Date Of bill may be shown by parol 10 Omission of 19 IMDEX. 201 Date — Conthmed. page. Holder may insert '9 If wrong date is inserted ^9 Presumed to be true date unless contrary proved . . . . 20 A bill may be antedated '^ Or post dated 21 If on a Sunday 21 Days of grace 21 Not allowed on demand l)ills 21 Allowed on l)i]ls payable at or after sight or after date . . 21 Dead, where drawee or acceptor 76 Death, drawee's, does not revoke authority to complete bill 3^ Presentment for acceptance where drawee dead . . . • 68 Presentment for payment when drawee dead 7^ Notice of dishonour if indorser or drawer dead . . . • 85, 87 Debt, antecedent, may be consideration for bill . . 42 Defects of title 45 When attaching to bill ^° If taken after maturity 6° Or after notice of dishonour 61 Defence, interpretation of 7 Delay, necessary for presentment for acceptance when allowed ^5 In making presentment for payment when allowed . . 78 Delivery, interpretation of 6 Requisites of ^^ May be shown to have been conditional 33 Valid, when presumed 33 Prima facie, when not in possession of acceptor . . . . 33 Invalid, if made through forged indorsement 34 Demand, bill payable on, defined 17 Payable on presentation, payable on demand i7 When no time expressed payable on demand . . . • 1 7 Bill payable at sight not payable on demand i7 Bill accepted or indorsed overdue, payable on demand . . 18 r . . 21 Due date of Not entitled to days of grace ^^ |i WU: i<\ li! P I m 202 Bills of Exchange Act, 1890. Demand, bill payable on, defined~Con^m?ied. p^„^ When deemed overdue g_ Need not be presented for acceptance 65,138 Presentment for payment When note payable on demand considered overdue .. 155 Deposit receipts ... '■ '^ ■ . . J23 When negotiable j . Detained Bill, how protested ^g Determinable future time 18 May l)e fixed by an event which is certain to happen . . iS Discharge of bill 109 Dishonoured bill By non-acceptance, when 70 By non-payment, when 80 Dishonour, notice of 80 When bill dishonoured by non-acceptance notice of dis- honour by non-payment not necessary 81 But may be given 92 Rules as to notice of dishonour 82 Must be given by or on behalf of holder 82 May be given by or on behalf of indorser liable upon bill 82 May be given by an agent 82 Given by holder enures to benefit of all subsequent holders 83 And all prior indorsers 83 Given by indorser enures to benefit of holder 83 May be written or verbal 83 Return of dishonoured l)ill equivalent to notice . . . . 84 Notice need not be signed 84 May be given to an agent 85 Must be given to each of two or more drawers not partners 85 When to be given 85, 86, 87 When to be given if in hands of agent 85 Notice to antecedent parties 86 How to be addressed 86 How to be addressed if designated by party 87 Postage must be prepaid 87 If miscarried in post does not invalidate 88 Excuses for non-notice 89 in Index. 203 Dishonour, notice of — Continued. page. Excuses for delay 89 When dispensed with 89 Waiver of notice 89 When wai n of notice implied 9° Dividend warrants may be crossed 166 Drawee of bill Bill may be payable to order of ^o If fictitious, bill may be treated as note 1 1 Must be named with reasonable certainty i ^ If name misspelt 27 May accept in his proper name 27 {^See Acceptor.) Drawer, bill may be payable to order of 10 Liability of ^°^ Protection to, when cheque is crossed ^5° Drunkards Contracts by 35 Their contracts voidable only 35 Drunkenness, complete, a defence 35 Duress, a defect in title 46 E English Law compared with Canadian 2 Equitable assignment 99 Estoppels of acceptor 99, 1°° Of acceptor for honour . . Of drawer Of mdorser Exchange ^° Par of exchange •'^ Current rate of "^ Exhibited, bill to be, when presented for payment 98 Extinguishment " liti 204 Bills of Exchange Act, 1S90. m m 'i •A iW: Faith, good, when presumed Farming partnerships, parties to bill or note . . Fictitious payee Figures, marginal Firm name varied does not bind the partners {Str Partners — Partnership, ) Force and fear, a defect in title Foreign bill, defmed Foreign bill must be protested Due date of {See Coiijlict of Laivs.) Foreign protest//'/;;/^? yinr/t' evidence Forgery. {Sec Signaliirc.) Forms in schedule to Act Noting for non acceptance Protest of bill for non-payment or non-acceptance payable generally Ditto payable at a stated place Protest for non-payment of a bill noted but not protested for non-acceptance Protest of a note payable generally Ditto payable at a stated place Notice of protest for non-payment or non-acceptance of a bill Notice of protest of promissory note Notarial service of notice Protest by a justice of the peace Forms, General Of inland bill Of foreign bills Of promissory note Of cheque crossed generally Of cheque crossed specially Of protest for non-acceptance of bill payable generally The same where payable at a stated place I'AOE. 47 37 r 2 16 46 10 92 136 '37 71 '71 172 '73 [74 '75 176 11 78 78 79 [82 [82 ■83 '83 iS3 ,84 '85 Index. 205 Forms, General — Continued. p^ge. Of protest for non-payment of a bill payable generally. . 186 Of protest foi .on-paynient of bill payable at stated place. . 187 Of protest of not' payable generally 1S8 Of protest of note payable at stated place 189 Of notice of protest to drawer for non-acceptance of bill 190 Ditto for non-payment of bill 190 Of notice of protest to acceptor for non-payment of bill 190 Of notice of protest to indorser for non-acceptance of bill. 191 Ditto for non-payment of bill 191 Notice of protest to maker of note 191 Notice of protest to indorser 192 Notarial act of honour attesting payment of a bill for honour supra protest 192 Fraud, a defect in title 46 Fund Payment of bill out of particular 9 G Good faith 161 Grace, days of. [See Days of Grace) 21 Guarantor. {See Aval) 103 When entitled to notice of dishonour 82,104 H Holder, interpretation of 6 For value, defined 43 May be, if has a lien 44 In due course, defined 45 Must acquire bill before maturity 45 Must have no notice of defect 45 Must take bill in good faith 45 Must have given value 45 Title through, valid, whether value given or not . . 46 Of bill, rights of 62 General duties of ^4 Holidays, legal 21 Legal, in Quebec • • • *3 206 Bills of Exchange Act, 1890. H- Page. onour, acceptance for 120 Payment for 124,125,126 (See Payment for Honour Supra Protest.) Hours, reasonable For presentment for acceptance 67 For presentment for payment 74, 94 I Illegal consideration, a defect in title 46 Immediate and remote parties 33 Inchoate instruments 30 Indemnity. (See Lost Bill.) Indorsee, provisions as to payee apply to .. ., 57 Indorsement, interpretation of 6 In blank 14 Of overdue bill, effect of 18 Requisites of valid 54 Must be on bill or allonge 54 Must be of entire bill 54 By two or more payees 54 Power of parties not sui juris to indorse 55 By married woman 55 Presumed to have been in the order on the bill . . . . 56 By accommodation parties . . . . 56 When indorse's liable to mutual contribution . . . . 56 May be blank or special 56,57 Conditional 57 In blank may be converted into special 58 Restrictive 58 Indorser, how he may avoid personal liability. . . . 53 Liability of 102 When a surety 118 Infant not competent to become party to bill .. 35 Not even for necessaries 35 Effect of indorsement by 35 Inland bill defined 10 Need not be protested 92 Index. 207 Page. Inland note defined 153 Insolvent, if acceptor, bill maybe protested for better security 93 Instalments, bill or note may be payable by ... . 15 Interest, bill may be payable with 15 Rate after maturity ^6 What rate 17.105 Legal, what 17,106 No implied contract to pay higher rate after maturity . . 17, 105 Usurious 48 48 49 49 132 5 Statutes as to Rate chargeable by banks . . Penalty for taking excessive What payable on foreign bill Interpretation Issue, interpretation of 7 J Joint and several note {See Promissory Note.) Judgment, against one jointly liable, a bar to action against the others Against one member of a firm bar to action against others Effect of, as to other parties Justice of the peace, protest by »54 12 36 117 164 Liability of parties Of acceptor Of indorscr Of stranger Of accommodation indorsers to each other Of drawer Of transferrer by delivery Of acceptor for honour To what parties By what estoppels bound 99 99 102 103 58 lOI 108 122 122 122 Ir: 208 Bills of Exchange Act, 1890. Liability of parties — Continued p^^^ Bill must be protested for non-payment before presentment to acceptor S. P 122 Limitations, statute of, runs from date of demand bill or note 61,150 Lost bill, duty of loser 64 How protested 96 Holder of, right to duplicate bill 127 If duplicate refused, effect of 127 Sufficiency of security .. .. 128 Action on 128 Indemnity should be offered 129 Lunatics, contracts by 35 Contracts only voidable 35 M Maker of note, liability of 159 Marking cheque 141 Married women, can become parties to bills in respect to their separate estate 35.36 Merchant, the law 4 Merger 117 Mining partnerships Ordinarily not bound by signature of a member . . . . 37 Misspelling of payee's name 55 Month means calendar month 24 How due date fixed where no corresponding day in due month 24 Municipal corporations Can be parties to bills or notes 163 N Negligence, only gross, defeats title to bill .. .. 161 Negotiable bill defined 13 When negotiability ceases 59 IGE. 22 64 27 [27 Index. Negotiation of bills Payable to bearer Payable to order Where bill payable to order, effect of omission to indorse Deemed to have been before bill was due To party already liable Non-acceptance Bill must be accepted within two days When bill dishonoured by Immediate right of action accrues Non-juridical days " Not negotiable " crossing Notary, fees chargeable by • {Sec Justice 0/ the Peace.) Note, interpretation of {See Promissory A^ote) Notice of dishonour {See Dishonour) Notification of acceptance Equal to delivery Noting of bill Time of When equivalent to protest 209 Page. 51 51 52 52 61 62 69 69 70 70 22 165 6 '52 80 82 5.33 33 91 93 163 C) Office, bill may be payable to holder of .... 12 Officer of bank not to act as notary ^5 Onus, see proof 47 Option of payee where bill payable to the order of 15 " Order " striking out the word after payee's name 13 Bill payable to 14 Overdue bill, effect of negotiation of 60 Bill accepted or indorsed overdue becomes payable on demand 18 :' Ir 210 Bills of Exchange Act, 1890. P T» c Page. Par of exchange 135 Part, indorsement for 54 Partial Acceptance 29, 71 Failure of consideration 43 Particular fund Payment of bill out of 9 Partners Bound by signature of firm 36 Partnership Mining 37 Farming 37 Professional 37 Trading 37 Patent right When consideration for bill or note 49 " Given fur a patent right " 49 Defence in action upon such bills 50 Penalty for omitting the words 50 Payee If fictitious, bill payable to bearer 12 So if non-existing 12 May be the holder of an office 12 Blank for name of 8, 3 1 Misdescription of 55 Payment In due course 63, 109 Of bill to wrongful holder 63 Bill must be presented for 72 Rules for presentment 73 Of demand bills 73 How to be made 74 At what place 74 Where no place specified 74 Where no address given 75 Where in other cases 75 71 43 Index. 21 i Payment — Continued. page. If no person at place of payment 75 How presentment made to parties not partners .... 76 When drawee or acceptor dead 7^ Effect of payment by Drawer or indorser 109 By a third party 110 By accommodation party ii<* Payment for honour 124 If more than one offer to pay "4 Must be attested by a notarial act of honour 124 It is the basis thereof 125 Payment otherwise voluntary 125 Liabilities and rights after 125 Delivery to payee for honour 126 Personal reprensentatives Presentment for acceptance to, optional 68 Must be presented for payment to 7 6 Place of payment 97 When no place specified 97 When place specified 97 Effect of neglect to present at 97 Not necessary to present the day of maturity to bind the acceptor 97 Nor the maker of note '5^ Place for presentment of note 15^ Possession What, holder must have 5» Post-dated bill 21 Post-office Presentment through 68, 76 Presentment at 77 Miscarriage of notice in 88 Presentation, bill payable on Is a demand bill ^7 Presentment for acceptance 66 Time for presenting bill payable after sight 66 {See Acceptance.) !1' 212 Bills of Exchange Act, 1890. Presentment for payment page Bill must be presented for payment . . 72 Made through post-ofifice 76 Made at post-office 77 AVhen excused 78 {See Payment.) Presentment for payment to acceptor for honour 122 Hill must be noted or protested before 122 Time for 123 Excuses for 123 Delay in 123 Presentment of note for payment 156 If place of payment specified, not payable generally . . 157 Necessary before action against maker 157 Otherwise costs in discretion of Court 156 Necessary to render indorser liable 157 Principal and agent 39,161 {See Agent.) Principal and surety 118 Procuration, signature by 39 Is notice of limited authority 39 How authority constituted 4° Professional partnerships 37 Proof, burden of, on whom it lies 47 Promissory note 152 Definition of 152 Payable to maker's order 153 Inland and foreign iS3 Delivery necessary to complete 154 Joint and several >S4 " I promise to pay " signed by two or more 154 Payable on demand i55 When deemed overdue i55 Provisions as to bill apply to 159 Corresponding terms . . > 60 What provisions do not apply to 160 Foreign note 160 1 1 Index. 213 Protest paoe. Of inland bill not necessary except in Quebec 91 Of foreign bill necessary 92 May be extended subsequently of the day of the noting . . 93 What it shall set forth 95 Excuses for want of 96 Excuses for delay 96 Expenses of 106, 165 Pn'/fia Facie evidence 166 Foreign, /r/wrt/rt^r/V evidence 137 Forms to be used 166 {See Forms.) Protested, where bill must be 94 When, if presented through post-office 94 Bill may be, after 3 p.m 94 Public holiday 21 In Quebec 23 Q Qualified acceptance 7' Holder may refuse 7 ' Effect of taking without authority 7^ What is assent to, by prior party 72 Quebec, holidays in 23 All bills must be protested in 9^ R Reasonable time 66,73,155 Receipt, is payee bound to give '15 Recourse, drawing or indorsing without .... 26 Re-exchange ^°^ Referee in case of need • • 25 Release Effect of, as to others jointly liable i*^ 214 Bills of Exchange Act, 1890. Renewal, effect of taking bill in iJ- Renunciation „ j Must be in writing 1 1 1 Or bill delivered up 1 1 1 Repeal of enactments ,67 Retroactive, Act not 169 Revenue laws, foreign How far regarded 133 Satisfaction 116 Accord without satisfaction 112 Schedule of enactments repealed iSi Sealing, effect of, a note 162 Security, protest for better 93 Sight. (See At Sights After Sight.) Signature Essential to liability 36 In assumed name sufficient 36 Forged or unauthorized 37 Authority may be implied 38 No estoppel if forged 38 Forged, to a cheque 38 Forged, to a cheque, when binding 39 What is notice of forgery 39 By procuration 39 What is sufficient authority for, by procuration 40 May be by agent 161 Sixty, section, of Imperial Act no Special crossing. (5^^ C//(?^«^) .. .. 145 Special indorsement. (See Indorsement?) Stolen bill. {See Lost Bill) 64 Sum payable 15 Must be certain 8 May be with interest . . 15 May be payable by instalments 15 Proviso for default 15 Index. 215 Sunday, bill dated on "^^^ Supra protest. (See Honour) ,3^ Surety, where party to a bill is ,,3 Suspension „_ T Time, computation of 21, 23, 163 Time, reasonable For presenting sight bill 66 A mixed question of law and fact 67 When a question of fact 61 For presenting demand bill ^ , For presenting note lec Transferrer by delivery jog Warranty of 108 u Undue influence 46 Usage of trade As to its effect on question of reasonable time . . 67, 73, 155 Usurious consideration 48 ff V Value Interpretation of . . . . 7 Holder for, defined 43 When presumed 47 Valuable consideration How constituted 42 An antecedent debt sufficient 42 2i6 Bills of Exchange Act, 1890. W Waiver ,,,^, Of presentment 26,80 Of notice of dishonour 89 When implied 90 {See Reniiiicidiioii.) Warranty of transferrer by delivery io8 {See Estoppel.) " Without recourse " 26 I'AUK 26,80 89 90 I 08 26