^^ ^> ^7^> IMAGE EVALUATION TEST TARGET (MT-3) A 1.0 I.I E: US 112.0 1.8 1.25 1.4 J4 .4 6" - ► V] <^ /] 7 •p^ ^./ .'^,.'^' %" (meaning "CON- TINUED "), or the symbol V (meaning "END"), whichever applies. Un des symboles suivants apparattra sur la dernidre image de cheque microfiche, selon le cas: le symbols — ► signifie "A SUIVRE ", le symbole V signifie "FIN". Maps, plates, charts, etc., may be filmed at different reduction ratios. Those too 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 cartes, planches, tableaux, etc., peuvent dtre filmds d des taux de reduction diffdrents. Lorsque le document est trop grand pour dtre reproduit en un seul clich6, il est filmd i partir de Tangle supdrieur gauche, de gauche it droite, et de haut en bas, en prenant le nombre d'images ndcessaire. Les diagrammes suivants illustrent la mdthode. 1 2 3 1 2 3 1 4 5 6 ^ I i BILLS OF EXCHANGE, CHEQUES AND PROMISSORY NOTES. T^IE BILLS OF EEHMGEACTjSaO, BEING AN ACT RELATING TO BILLS OF EXCHANGE, CHEQUES AND PROMISSOKY NOTES (53 Victoria, Chapter di of the Acts of the Parliament of Canada^ TOGETHER WITH AN INTRODUCTION, EXPLANATOEY NOTES BY ROPBRT STANLEY WEIR, B.O.L. uft-ID'^OC^SuT'E, Author of ''An Insolvency Manual," &c. MONTREAL A. RKRIARD, I^aw Publisher. 23, ST. JAMES STREET. 1891 A: I o Entered according to Act of Parliament in the year 1890, by RoiJEHT Stanley Weik, B. C. L., and A. pEKiAFii), in the office of the Minister of Agri- culture, Ottawa. INTRODUCTION. i The Bills of Exchange Act, 1890 (53 Vict., ch. 33) which forms the text of this hand-book, is a reproduction with some modifications, of the Imperial Statute, 45 and 46 Vict., ch. 61, entitled '' An Act to codify the law relating to Bills of Exchange, Cheques and Promissory N-Qtes"— short title, — ^' The Bills of Exchange Act, 1882." The Canadian Act was introduced in the House of Commons by Sir John Thompson, Minister of Justice, early in the session of 1889, but after considerable progress had been made in committee, it was withdrawn owing to press of other public business. It was again introduced by Sir John Thompson in the session of 1890 and after revision by Commons and Senate, was assented to, on the 16th May, 1890. By special provision, however, the Act only comes into force on the 1st September, 1890, and is not retroactive. A perusal of the debates of both Houses, shows that a general desire was manifested by honorable members and senators, to deviate as little as possible from the text of the English Act, so that we might have in Canada, the obvious advantages in respect of the important subjects with which the Act deals, of uniform legislation VI INTRODUCTION. through Canada and the mother country, and the application of whatever jurisprudence might grow up around the law in both lands. The differences between the English and Canadian Acts include some slight vt rbal changes ; other changes in respect of presentments, protests and forged bills ; ai d, also the result of the incorporation of already existing enactments of our Parliament of proved utility and advantage. These differences have been as far as possible, indicated in the text by brackets [ ] , so that the practitioner or student in referring to English jurisprudence may readily perceive its applicability. The effect of this Act being to alter the law in a number of more or less important particulars, the changes in the law and the positive declarations upon points that have hitherto been uncertain, have been indicated by the simple devices of italics, with the exception of the sections relating to crossed cheques, which are all new. By the British North America Act 1867 (30-31 Vict., ch. 3, sec, 91, sub-sec. 18) Bills of Exchange and Promissory Notes are placed amongst those subjects which are reserved for the exclusive legislative authority of the Parliament of Canada. This power has now been exercised for the first time and accordingly all previous enactments hitherto in force in the provinces, have been repealed, as will be seen on reference to the second schedule forming part of the Act. An exception to this general repeal exists however, as regards the Province of Quebec, where two articles of the Civil Code under the title of Bills of Exchange have been retained. These articles 2341 and 2342, relate to evidence and enact that in matters doubtful and unprovided for, recourse must i. INTRODUCTION. vu be had to the laws of England in force on the 30th May, 1849. The English Statute which, as has been stated, forms the basis of the Canadian Statute, was drafted by the Hon. Judge Chalmers, who had previously prepared and published a Digest or Codification of the English law on bills of exchange. In the House of Commons the Bill had the great advantage of being in charge of Sir Farrer Herschell (now Lord Herschell) while Lord Bramwell piloted it through the House of Lords. Besides, in the House of Commons after the second reading, it was referred to a Select Committee composed of leading merchants, bankers and lawyers who tested and revised it w^ith great care. It is not surprising therefore, that English merchants and bankers have found the Statute of great practical service. A similar result may be fairly predicted for the Canadian Act. Sir John Thompson, in our Commons, and the Hon. Mr. Abbott, ip the Senate, have both, like their English compeers and as Hansard well discloses, devoted great powers of elucidation and commendable energy and ability in conducting the Bill through Parliament. In this task they received valuable aid (if it be not invidious to mention some names) , from Messrs. Weldon, Mills, Davies, Mitchell, Patterson, in the Commons, and the Hon. Messrs. Power, Drummond, Scott, Kaulbach and Ogilvy in the Senate. In view of the fact that Judge Chalmers' admirable work (1) is replete with all essential annotation and comment, it has not seemed necessary to swell the pro- (1) A digest of the law of Bills of Exchange, London, 1887. VI 11 INTRODUCTION. portions of the present work beyond the requirements of a brief Manual or Hand-book. Such comments and references only as seemed desirable for the better elu- cidation of occasional sections have been made. Those who desire a more intimate acquaintance with the jurisprudence which illustrates the text cannot do better than consult Judge Chalmers' book, to which, as will be seen, I have frequently referred. It was the compiler's intention to collate Canadian jurisprudence with the text, but a desire to keep the book within modest limits and to supply the immediate demand for the text of the law in a form convenient for ready reference, has led him to postpone such an under- taking for the present. ? St ij The changes in the law which this Act effects are not very numerous, but some of them are important and may be briefly stated. Heretofore a bill payable to the holder of an office for the time being, e.g. a Secretary, Treasurer or President, was considered invalid by reason of uncertainty. By sec. 7 such bills are now valid. A bill payable e.g. to " John Smith " without the words " or order" has been hitherto held to be non-negotiable. Under sec. 9 such a bill is now negotiable. The Act also contains provisions for inserting in a bill the true date of issue or acceptance by any holder when such date has been omitted. (Sec. 12.) Formerly, under article 2290 of the Civil Code for Lower Canada, it was obligatory to resort to the referee in case of need. Such resort is now optional, but a bill must be protested for non-payment before it can be legally presented to the referee in case of need. (sec. 66.) •^« INTRODUCTION', iz A corporation can now issue a bill or note under its seal without signature, altliough its seal is not necessary if there be a correct signature, (sec. 91.) Under sec. 22, a corporation can legally make a bill if the power to do so has been conferred upon it by its charter. It is, however, ultra vires of the Provincial Legislatures to confer such power. (B. N. A. Act, sec. 91, sub-sec. 18.) The first paragraph of section 24 gives effect to the well established principle that a forged or unauthorized signature is wholly inoperative, and so far, it is an exact reproduction of the corresponding section of the English Act. Under the English Act, however, iijuikers who may pay demand drafts held under forged indorsements are protected. This feature of the Eup'ish Act hn^ not not been reproduced in the Canadip.n Act, but section 24 has been amended so that the drawer uf a cheque shall have no right of action against a drawee who has charged the drawer with a cheque paid under a forged or unauthorized signature unless notice of such forgery be given in writing to the drawee within a year after the knowledge of the forgery is acquired. The i^rotest for better security against the drawer and indorsers (sec. 51) when an acceptor becomes insolvent or suspends payment, is new to our law, but is quite consistent with article 1092 of the Civil Code of Lower Canada, which enacts that the debtor cannot claim the benefit of the term (or unexpired delay) when he has become insolvent. In Germany when the acceptor fails during the currency of a bill, the holder can demand security from the drawer and indorsers, and in France he can at once cause the bill to be protested for non- payment. The effect of this section will be that a bill INTRODUCTION. protested for better security may be accepted supra protest for honor, see sec. 65. The provisions of Act 2296 of the Civil Code as to acceptance for honor after protest for non-payment are not to h^ found in the Act, and the acceptance for honor can only be offered after protest for non- acceptance or for better security, and before maturity. (sec. 65.) Where the drawee is dead, presentment for acceptance may now be made to his personal representative or it may be treated as dishonored by non-acceptance, (sec. 41.) A presentment through the post-olfice is sufficient where authorized by agreement or usage, (sec. 45.) This gives effect to a well established custom in England and the United States. Three days are now given for the acceptance of a bill, viz: the day of actual presentment and two days there- after. If not then accepted it must be treated for non- acceptance. (Sec. 17.) The English Act treats an acceptance to pay at a particular place as a qualified acceptance which, by sec^ 44, the holder may refuse to take, but the Canadian Act has not reproduced this provision. If a bill be payable at n particular place, it must be presented for payment at that place, else the holder may be obliged to pay the costs of any suit that may have been taken, if the party liable shows that money had been provided for the payment of the bill. (sec. 86.) Art. 2285 Civil Code provided that the words ^' value received" created a presumption, that the amount mentioned in the bill had been received thereon, but now such presumption will exist without such words. The acceptance must now be written on the bill itself, INTBODUCTION XI but the simple signature of the acceptor without other words denoting acceptance is sufficient. A bill payable on demand must be protested within a reasonable time or the indorser will be discharged, but not if with the assent of the indorser the bill has been delivered as a collateral or continuing security, (sec. 85). A person signing a bill otherwise than as a drawer or acceptor, e. g. as an indorser pour aval, is entitled to be protested. In the Province of Quebec the right to serve notice of protest at any time within three days next after the day on which the bill is protested, is now abrogated, and must be exercised not later than the next following juridical day. (Sec. 49.) The protest or noting for non-payment must be made after three o'clock in the afternoon of the lastday of grace. (Sec. 51.) The i-rovisions of the English Act as to crossed cheques have al o been incorporated in the Canadian Act. Crossed cneques are but little if at all used in this country, but the growth of commerce and finance will undoubtedly lead to a widespread use of these convenient instruments. The practice appears to have originated in the Clearing House, and was afterwards adopted out- side. A crossed cheque operates as a caution to a banker or other holder, and as a general rule bankers refuse to pay it to any one except a bunker. In this way the person for whose use the money is received may be easily traced. The reason crossed cheques are not more in vogue in this country probably is, that banks exercise greater caution in paying cheques here than in England, where the presumptions of law are not so stringent against bank and bankers. ■ • Xll INTEODUCTION. The foregoing summary embraces the more prominent changes enacted by the Act. A perusal of the Act wiU disclose .thers which do not call for special comment a« EOBT. STAN^LEY WEIR, :No. 186 St. James Street. Montreal, June 23rd, 1890. inenfc will Qt as ntel- : 1 1 CONTENTS. PAGES Introduction v PART I. Definitions 1 PART II. Bills of Exchange. 2 Form and Interpretation 2 Capacity and Authority of Parties 15 The consideration for a Bill 19 Negotiation of Bills 22 General Duties of the Holder 28 Liabilities of Parties 43 Discharge of Bill 46 Acceptance and payment for Honour 48 Lost Instruments 51 Bill in a Set 51 Conflict of Laws 52 PART III. Cheques on a Bank. 54 Crossed Cheques 55 PART IV. Promissory Notes. 69 PART V. Supplementary. 63 First Schedule 67 Second Schedule 78 Index 79 I Eo^ re< an cal ( coi ( inc bus U Act bod can (' pen pay exc] not( (j THE BILLS OF EXCHANGE ACT, 1890. PAET I. PRELIMINARY. 1. This Act may be cited as " The Bills o/shorttitie Exchange Act, 1890." -^ ^''°"^^"«' require^'s,-" '^'*' '"'^''' ^^^ «<>^text otherwise interpretation («.) The expression ^^ Acceptance " means -Acceptance " an acceptance completed by delivery or notifi- cation ; (5.) The expression '^ Action " includes "Action " counter claim and set off ; (c.) The expression ^' Bank " means an "Bank.- incorporated bank or savings bank carrying on business in Canada j ^ s "" Ac^'^f Ls^ed ^?}£^^i^^ '^^*- "Pon which the present Act IS based, the expression " Banker " incaudes a body of persons, whether incorporated or not who carry on the business of banking. ^'^^ *^^ ^o^^ who r^Stl^^^ expression '^Bearer" means the " Bearer.- person in possession of a bill or note which is payable to bearer ; (e) The expression '' BilP' means bill of "Bin- note'^''^''' a^id - Note " means promissory " ^°''^" (/.) The expression ^^ Delivery '^ means <• Delivery. ■- 2 The Bills of Exchange Act, 1890. "Holder.' " Indorse- ment." " Issue. " '• Value. " Defence. transfer of possession, actual or constructive, from one person to another ; A person has constructive possession when the Bill is in the possession of his clerk or agent in that person's behalf. {g.) The expression '' Holder ' means the payee or indorsee of a bill or note who is in possession of it, or the bearer thereof ; (/i.) The expression ''Indorsement" means an indorsement completed by delivery ; (i.) The expression '' Issue " means the first delivery of a bill or note, complete in form, to a person who takes it as a holder ; (j.) The expression '' Value " means valu- able consideration ; (A;.) The expression '' Defence " includes counter-claim. — (45-46 Vict. ch. 61, sec. 2. Stat- utes of Great Britain.) This Act deals only with Bills of Excl ange, Cheques and Promissory Notes. It does not apply to other negotiable instruments such as negotiable Bonds or Scrip. Following the general rule of law applicable to Statutes, this Act is not retroactive or retrospective. # PAET II. BILLS OF EXCHANGE. Form and Interpretation. Bill of ex- change defined. 3* A bill of exchange is an unconditioi:''.! order in writing, addressed by one pers; : : another, signed by the person giving it, re' -.i' r ing the person to whom it is addressed to v , 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 : # The Bills of Exchange Act, 1890. 3 Exact definitions are proverbially rare, and the foregoing definition is conspicuously inexact. A Bill of Exchange is defined as an unconditional order in writing, and yet no fewer than five condi- tions are appended as requisite to complete it ! Fur- ther by a curious contradiction in terms, it is de- clared (vide sub-sec. 2) that an instrument which does not comply with these conditions, is not a Bill of Exchange ! The meaning intended is, of course, not, that the whole instrument must be uncondi- tional ; but that the order to pay must be uncondi- tional. In the words of the discarded article 2279 of our Civil Code (which is Chancellor Kent's definition approved by Judge Story) " a Bill of Exchange is a written order by one person to another for the pay- ment of money absolutely and at all events," There must in point of form, be three parties to a Bill of Exchange in its origin, and two of these at least, must be dififerent persons. They are: 1. The Drawer. 2. The Drawer, who becomes the Acceptor, by signing his assent to the Bill. 3. The Payee. The Drawer and Payee may be the same person or firm, ie. a Bill may be d^ xwn payable to the drawer or his order. 2. An instrument which does not comply When instru- with these conditions, or which orders any^chVmf°^ act to be done in addition to the payment of money, is not, except as hereinafter provided, a bill of exchange : 3. An order to pay out of a particular fund Unconditional 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 re-imburse 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 : ILLUSTRATIONS.—!. Pay C. or order $500 out of the money in your hands belonging to the X. company. Held, invalid as a Bill of Exchange. 4 The Bills of Exchange Act, 1890. Bill is not in- valid for rea- sons specified. 2. Pay C. or order $500 out of the money in due form X. as soon as you receive it. Held, invalid as a Bill of Exchange. 3. Pay C. or order $500 as my quarterly half pay due 1st February by advance. Held, valid as a Bill of Exchange. 4. Pay C. or order |500 against credit No. 20 and place it to account, as advised per X & Co. Held, valid as a Bill of Exchange. For English and American authorities collected and reviewed see Hunger and Shannon (1870) 61 N. Y. R. 251 ; and Corbett v. Clark (1878) 30 Amer. R. 763. 4. A Mil is not invalid by reason — (a.) That it is not dated ; As to filling in the date in the case of an undated Bill or Acceptance, see sec. 12 and 20 post. The alteration of the date is a material alteration, sec. 64 (2). (b.) That it does not specify the value given, or that any value has been given therefor ; Whether a Bill expresses that value has been given or not,extrinsic evidence is admissiblebetween immediate parties and those in privity with them, to impeach the oonsideration, and show its absence, failure, or illegality. {Abrey v. Crux, L. R.5 C. P. 37.) (c.) That it does not specify the place where it is drawn or the place where it is payable. (Ibid. sec. 3.) Inland and foreign bills. If not noted as foreign. 4. 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 : (Ibid. sec. 4.) The Bills of Exchange Act, 1890. • 5« A bill may be drawn payable to, or to if different the order of, the drawer ; or it may be drawn Sro the same payable to, or to the order of, the drawee : person. A bill is sometimes drawn in the form, " Pay to your own order," when the drawee acts in two different capacities, e. g. if he be in business on his own account, and also agent for some other person interested in the bill. Pardesaus 2339. 2. Where in a bill drawer and drawee are Optional the same i^erson, (5) or where the drawee is a gpecffled^. °^^° fictitious person, or a person not having capacity to contract, the holder may treat the instru- ment, at his option, either as a bill of exchange or as a promissory note. {Ibid. sec. 5.) As when a person does business in two cities, and draws from one on the other. <»• The drawee must be named or otherwise Drawee to be indicated in a bill with reasonable certainty : "*™®^- 2. A bill may be addressed to two or more if there are drawees, whether they are partners or not ^n^ore than one. but an order addressed to two drawees in the alternative, or to two or more drawees in suc- cession is not a bill of exchange. {Ibid. sec. 6.) By sec. 19 (d) the acceptance of some one or more of the drawees, but not of all is a qualified ac- ceptance. This section does not conflict with sec. 15 which provides as to a referee or drawee in case of need. T. Where a bill is not payable to bearer, certainty re- the payee must be named or otherwise indicated q«ired as to therein with reasonable certainty : payee. 2. A bill may be made payable to two or if payable to Eayees, or to old Ider of more payees jointly, or it may be made pay- *^^° °'* ™°^^ able 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 : 6 The Bills of Exchange Act, 1890, If payee is non-existing. Certain bills valid but not negotiable. Payable to order or bearer. To bearer. To order. Option of payee. Heretofore a bill payable e. g. to the Treasurer or other official of a society was considered invalid as a Billjbv reason of uncertainty . This section makes the law clear, and such Bills are now valid. 3. Where the payee is a fictitious or non-exist- ing yerson, the bill may be treated as payable to bearer. (Ibid.) This is supplemented by sec. 54, which provides that the acceptor is precluded from denying to a holder in due course, the existence of the payee and his then capacity to indorse ; and by sec. 55 which enacts that the drawer is precluded from denying to a holder in due course the existence of the payee and his then capacity to indorse, and that the indorser is precluded from denying to a holder in due course the genuineness and regularity of all previous indorsements. Vide sees. 54 and 55 post. Hm When a bill contains words prohibiting transfer, or indicating an intention that it should not be transferable, it is valid as between the par- ties thereto, but it is not negotiable : 2. A negotiable bill may be payable either to order or to bearer : 3. A bill is payable to bearer which is express- ed to be so payable, or on which the only or last indorsement is an indorsement in blank : 4. A bill is payable to order which is expressed to be so payable, or which is expressed to be pay- able to a particular person, and does not contain words prohibithig transfer or indicating an intent- ion that it should not be transferable : A bill payable e. g. to " John Smith " without the words " or order " has been hitherto held to be non-negotiable. Under the Act such a Bill is now negotiable. 5. Where a bill, either originally or by indorsement, is expressed to be payable to the order of a specified person, and not to him or I I 4 I I The Bills of Exchange Act, 1890. 7 his order, it is nevertheless p.ayable to him or his order, at his option. (Ibid.) 9. The sum payable by a bill is a sum certain sum payable, within the meaning of this Act, although it is required to be paid — (a.) With interest ; The legal rate of interest at present is 6 per cent, and is the rate presumed, m default of any other rate being specially mentioiied. (R. S. 0. ch. 127, sec. 2. (6.) By stated instalments : (c.) By stated instalments, with a provision that upon default in payment of any instal- ment the whole shall become due ; (tZ.) According to an indicated rate of ex- change, or according to a rate of exchange to be ascertained as directed by the bill : 2. Where the sum payable is expressed in Discrepancy words and also in figures, and there is a dis- Sguresand crepancy between the two, the sum denoted ^^ords. by the words is the amount payable. 3. Where a bill is ex j)ressed to be payable interest. with interest, unless the instrument otherwise provides, interest runs from the date of the bill, and if the bill is undated, from the issue thereof. (Ibid.) lO. A bill IS payable on demand — Riii payable ^ \ Tirx.- 1- • 3 J. 1 1.1 on demand. (a.) Which IS expressed to be payable on demand, or on presentation ; or — (6.) In which no time for payment is ex- pressed : 2. Where a bill is accepted or indorsed Acceptance, when it is overdue, it shall, as regards the overdue!" acceptor who so accepts, or any indorser who so indorses it, be deemed a bill payable on demand. {Ibid.) 8 The Bills of Exchange Act, 1800. tii v;i Bill payable at a future time. As to contin- guncics. !!• A bill is payable at a determinable future time, within the meaning of this Act, which is expressed to be payable — (a.) At a fixed period after date or sight : (&.) On or at a fixed period after the occur- rence of a '^^)ecified event which is certain to happen, though the time of happening is uncer- tain : 2. An instrument expressed to be payable on a contingency is not a bill, and the hap- pening of the event does not cure the defect. {Ihid.) Omission of 13* Where (i hill expressed to he 2^o?/ahle at a payaWe^aftcr J^-^^d pcrlod after date is issued undated, or where date. the acceptance of a hill pay ahle at a fixed period after sight is undated, any holder may insert therein the true date of issue or acceptance, and the hill shall he payahle accordingly, This section throws any possible inconvenience that may arise from the omission to date the bill on the negligent party who omitted to date the bill. Chalmers, 29. Provided that (a) where the holder in good faith and by mistake inserts a wrong date, and (h) in every case where a wrong date is inserted, if the bill subsequently comes into tne hands of a holder in due course, the bill shall not be voided thereby, but shall operate and be pay- able as if the date so inserted had been the true date. (Ihid.) As to wrong date. ,« Date pWmd l^* Where a bill or an acceptance, or any /acie evidence. iii(jorsement ou a bill, is dated, the date shall, unless the contrary is proved, be deemed to be the true date of the drawing, acceptance, or indorsement, as the case may be : Certain dat- 2. A bill is not invalid by reason only that vSidate.°^" it is antedated or postdated, or that it bears to The mih of Exchange Act, 1S90. 9 date on a Suiitlay [or other uoii -juridical day.] {Ibid.) 14. Where a bill is not payable on demand, computation the day on which it falls due is determined aspaymeiu. follows : — (rt.) Three days, called days of j^race, are, i>ay3 of grace, in every case where the bil' itself does not otherwise provide, added to the time of pay- ment as tixed by the bill, and the bill is due and payable on the last day of grace : Provided that — (1.) Whenever the last day of grace falls on Non-juridical a legal holiday or non-juridical day in the^***^' Province where any such bill is payable, then the day next following, not being a legal holi- day or non-juridical day in such Province, shall l)e the last day of grace : Under the Imperial Act, when the last day of grace falls on Sunday, Christmas Day, Good Friday, or a day appointed by Royal Proclamation as a public fast or thanksgiving day, the bill is due pay- able on the preceding business day ; except when the last day of grace is a bank holiday other than the holidays just mentioned, or when the last day of grace is a Sunday, and the second day of grace is a Bank Holiday, the bill is due and payable on the succeeding business day. 2. In all nuitters relating to bills of exchange ^^'^at shall be SUCil 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 ?" a^i Prov- , , ^ T» . n r^ \ ' inces except the Province of Quebec — Quebec. Sundays ; New Year's Day ; Good Friday ; (a movable festival.) Easter Monday ; (a movable festival.) Christmas Day ; The birthday (or the day fixed by proclama- 10 The Bills of Exchange Act, 1890. In Quebec. ! .= 1 In every Province. Days to be computed when time begins to run. When time begins to run. tion for the celebration of the birthday) of the reigning Sovereign j 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 public holiday, or for a general fast, or a gene- ral thanksgiving throughout Canada ; and the day next following New Year's Day and Christ- mas Day when those days respectively fall on Sunday ; (6.) And in the Province of Quebec the said days, and also — The Epiphany ; Epiphany {le jour dea Roia) is observed on the 6th of January. The Annunciation ; (25th of March.) The Ascension ; (a movable festival.) Corpus Christi ; (a movable festival.) St. Peter and St. Paul's day; (24th of June.) All Saints' Day ; (1st November.) Conception Day ; (8th December.) (c.) And also, in any one of the Provinces of Canada, any day appointed by proclamation of the Lieutonant 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 : 3. Where a bill is payable at sight, or at a fixed period after date, after sight, or after the happening of a specified event, the time of payment is determined by excluding the day from which the time is to begin to run and by including the day of payment : {Ibid. sec. 14, suh-aee. 2.) 4. Where a bill is payable at sight or a fixed period after sight, the time begins to run of the ly is a ), and day of for a gene- ad the hrist- fall on le said on the rune.) ices of 3ion of ice for giving layby r at a er the lie of e day ad by c. 14, fixed • run The Bills of Eocchange Act, 1890. 11 from the date of the acceptance if the bill is accepted, and from the date of noting or pro- test if the bill is noted or protested for non- acceptance, or for non-delivery : {Ibid, sub- sec. 3.) 5. 'ine term ^^ Month " in a bill means the "Months. " calendar month : (Ibid, sub-sec. 4.) [6. Every bill which is made payable at a Reckoning of month or months after date becomes due on the same numbered day of the month in which it is made payable as the day on which it is dated — unless there is no such day in the month in which it is made payable, in which case it becomes due on the last day of that month — with the addition, in all cases, of the days of grace.] (Revised Statutes of Canada, ch. 123. sec. 1.) 15. The drawer of a bill and any indorser Case of need, may insert therein the name of a x^erson to whom the holder, may resort in case of need, that is to say, in case the bill is dishonored by non-acceptance or non-payment. Such person is called the referee in case of need. It is in the ojytion of the holder to resort to the re- feree in case of need or not, as he thinks fit. (Ibid.) Under the law of ^^e Province of Quebec hith- erto, it was obligatory, not optional, to resort to the Referee. See Civil Code 2290. lO. The drawer of a bill, and any indorser, Optional may insert therein an express stipulation — ^''drawer'or (a.) Negativing or limiting his own liability indorser. to the holder ; Illustration.—" Pay D, or order without re- course to me." (b.) Waiving, as regards himself, some or all of the holder's duties. (Ibid.) 12 The Bills of Exchange Act, 1890. Illustration. — C. endorses to D., adding '' Pro- test waived." No subsequent holder is obliged to give notice of protest to C. I :, i I. I]! Definition of acceptance. Requisites of acceptance. Where name misspelt. IT. The acceptance of a bill is the significa- tion by the drawee of his assent to the order of the drawer : 2. An acceptance is invalid unless it com- plies with the following conditions, namely: — (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 ; (&.) It must not express that the drawee will perform his ijromise by any other means than the payment of money : (Ibid.) [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.] Time for ac- ceptance. Date, in case of acceptance after dis- honor. is. A bill may be accepted — {a.) Before it has been signed by the drawer, or while otherwise incomplete j (6.) When it is overdue, or after it lias been dishonored by a previous refusal to accept, or by non-payment : In such a case the Bill would be payable on de- mand. 2. When a hill payable after sight is dishon- ored hy non-acceptance^ and the drawee subse- quently accepts ity the holder, in the absence of any different agreement, is entitled to have the bill accepted as of the date of first presentment to the drawee for acceptance. {Ihid.) This provision is intended to put the holder in the same position, as far as possible, as that which he would have held, if the bill had not been dishonored by non-acceptance. I ^ « The Bills of Exchange Act, 1890. 13 19. An acceptance is either (a) general, or General and (6) qualified : a general acceptance assents SJptances**' without qualification to the order of the drawer ; a qualified acceptance in express terms varies the effect of the bill as drawn : 2. In particular, an acceptance is qualified Qualified ac- which is- ^^P'*"^^- (fl.) Conditional, that is to say, which makes payment by the acceptor dependent on the fulfilment of a condition therein stated, but an acceptance to pay at a particular spe- cified place is not conditional or qualified ; The following is a conditional acceptance. — " Accepted— payable on giving up bills of lading for clover, per ship " Amazon." Smith v. Vertue (1860) 40 L. J. C. P. 56. Under the Imperial Act an acceptance to pay at a particular place is a qualified acceptance. The Canadian Act differs in this respect. (6.) Partial, that is to say, an acceptance to pay part only of the amount for which the bill is drawn ; As where A draws on B. for $500, and B accepts for |250. (c.) Qualified as to time ; As where A draws on B for $500, payable two months after date and B accepts payable six months after date. (fZ.) The acceptance of some one or more of the drawees, but not of all. {Ibid.) 20. Where a simple signature on a blank inchoate in- paper is delivered by the signer in order that ^'''"™^"'^^' it may be converted into a bill, it operates as a prima facie authority to fill it up as a com- plete bill for any amount, using the signature for that of the drawer, or the acceptor, or an I When to be filled up. As to subse- quent holder. 14 The Bills of Exchange Act, 1890. indorser ; and, in like manner, when a bill is wanting in any material particular, the person in possession of it has di prima facie authority to fill up the omission in any way he thinks fit : 2. In order that any such instrument when completed may be enforceable against any person who became a party thereto prior to its completion, 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 eflfci'tual for all purposes 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 au- thority given. (Ibid.) Illustrations.— (1) Bill drawn payable to— or order. Any holder for value may write his own or name in the blank, and sue on the bill, (Cruchly v. Mann, F. Taunt. 529.) (2) B gives C a blank acceptance to accommo- date him, and without receiving value. After B's death it is filled up and discounted with D,who sees it filled up. D cannot recover the amount from B's estate (Hatch v. Searles 24 L. J. Oh. 22.) 3. A blank acceptance by B is stolen and then filled up. Even a holder in due course cannot recover from B. The instrument was inchoate and was never delivered. Boxendale v. Bennet, 3 Q. B. D. 525, 0. A. 1 ') al ri >^ Ci ,'• (1 Contract not 31. Every contract on a bill, whether it is deuve?y? ^^^^^ the drawer's, the acceptor's or an indorser's, is incomplete and revocable, until delivery of the instrument in order to give effect there- to : Vide sec. 2 (/) ante for definition of " delivery." Illustration.-B owes C |500 and makes a note for the amount payable to C. B dies, and the note is The Bills of Exchamje Act, 1890. 15 it is Requisites as to delivery. afterwards found amon^ his papers. C has no right to this note, and if it be given to him he cannot recover. Cox v. Troy. 1822 5B. and Aid. 474. " In order to make the property in bills pass, it " is not sufficient to indorse them. They must be " delivered to the indorsee, or the agent of the in- " dorsee. If the indorsee delivers them to his own " agent he can recover them ; if to the agent of the " indorsee he cannot recover them." Ex parte G6t6 (1873) L. R. 9. Ch. 27. Piovided, fchat where an acceptance is writ- Exception ten on a bill, and the drawee gives notice to, or according to the directions of, the person entitled to the bill that he has accepted it, the uoeoptance then becomes complete and irre- vocable : 2. As between immediate parties, and as regards a remote party, other than a holder in due course, the delivery — (a.) In order to be '^^ actual must be made By whom, either by or under the authority of the party drawing, accepting or indorsing, as the case may be ; (6.) May be shown to have been conditional or for a special purpose only, and not for the purpose of transferring the property in the bill; But if the bill is in the hands of a holder in due course, a valid delivery of the bill by all parties prior to him, so as to make them liable to him, is conclusively presumed : 3. Where a bill is no longer in the posses- sion of a party who has signed it as drawer, ac- ceptor or indorser, a valid and unconditional delivery by him is pres ^med until the contrary is proved. {Ibid.) Conditional delivery. When valid delivery presumed. Capacity and Authority of Parties. 22- Capacity to incur liability as a party to a Capacity of a bill is co-extensive with capacity to contract, p*^^^®^* 16 Tli,e Bills of Exchange Act, 1890. As to Corpora- tions. Drawing or indorsing by person not competent. Signature essential to liability. Exceptions. 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 such corpo- ration : This provision will enable a corporation to make a Bill if the power to do so has been conferred upon it by its charter. It is ultra vires of the Provincial Legislatures to confer such power. A corporation which is not empowered by its charter to make or indorse Bills of Exchange or Promissory Notes, cannot validly do so. In the Province of Quebec (Civil Code 1301), a wife cannot bind herself with or for her husband, other- wise than as being common as to property; any such obligation contracted by her in any|other qual- ity is void and of no effect. 2. Where a bill is drawn or indorsed by an infant, minor, or corporation having no capa- city 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. {Ibid.) 23. ^o person is liable as drawer, indorser, or acceptor of a bill who has not signed it as such : Provided that — (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 ; (b.) 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. {Ibid.) In the Province of Quebec, it is sufficient in actions upon Bills of Exchange or Promissory Notes to give the initials of the Christian or first names of the defendant, as written upon such bills, notes or instrument. (Art. 49 Code of Civil Procedure.) mmi m The Bills of Exchange Act, 1890 17 24. Subject to the provisions of this Act, Forged or un- where a signature on a bill is forged or placed s/gnaTure. thereon without the authority of the person whose signature it purports to be, the forged or unauthorized signature is wholly inopera- tive, and no right to retain the bill or to give a discharge therefor or to enforce payment there- of against any party thereto can be acquired through or under tliat 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 : For the Province of Quebec Article 145 of the Code of Civil Procedure provides as follows : "Every " denial of signature to a Bill of Exchange, Prom- " issory Note, or other private writing or document " upon which any claim is founded, must be accom- " panied with an affidavit of the party making the " denial, or of some person acting as his agent or " clerk, and cognizant of the facts in such capacity, '• that such instrument or some material part there- " of is not genuine, or that his signature or some " other on the document is forged, or, in the case of " a Promissory Note or Bill of Exchange, that the " necessary protest, notice and service have not been regularly made, stating in what the irregu- larity consists; without prejudice however to the recourse of such party by improbation." The word " precluded " was inserted in the Im- perial Act in lieu of the word " estopped " in defer- ence to the law of Scotland which does not make use of the English expression. A forgery cannot be ratified, yet a person whose signature has been forged may by his conduct be estopped from deny- ing its genuineness to an innocent holder, as where he declares a forgery of his signature to be genuine. Brook V. Hook (1871) L. R. 6 Ex. 100, cited by Chal- mers at p. 66. Provided that nothing in this section shall proviso. affect the ratification of an unauthorized sig- nature not amounting to a forgery : (Ibid.) [And provided aho, that if a cheque, payahle to order, is paid by the drawee upon a forged indorse- (( (( *K, 18 The Bills of Exchange Act, 1890. ment out of the funds of the drawer^ or is so paid and charged to his accountj the drawer shall have no right of action against the drawee for the re- covery hack 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 X roviso ' 8.3 to *^ v -*- t/ payment on forgery ', and in case of failure by the drawer to dSlement. ^^^^ ***^'^ 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 there- in, who has 7iot previously instituted proceedings for the protection of his rights.'] I i I Procuration signatures. Person sign- ing as agent or in repre- sentative ca- pacity. 25. A signature by procuration operates as notice that the agent has but a limited author- ity to sign, and the principal is bound by such signature only if the agent in so signing was acting within the actual limits of his autho- rity. (Ibid.) 20. Where a person signs a bill as drawer, in- dorser or acceptor, and adds words to this signa- ture 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 addi- tion to his signature of words describing him as an agent, or as filling a representative character, does not exempt him from personal liability : He who desires to avoid personal liability, should sign the name of his principal to the bill and then add words showing that he is merely an agent ; but if he signs his own name first he will be person- ally liable, notwithstanding any words added there- to, which declare him an agent. Unless he says plainly, " I am the mere scribe," he is liable. Rule for de- 2. In determining whether a signature on a sfgnature.^'^ ° bill is that of the principal or that of the agent i t The Bills of Exchange Act, 1890, 19 by whose hand it is written, the construction most favorable to the validity of the instru- ment shall be adopted. (Ibid.) The Consideration for a Bill. should then igent ; erson- there- e says on a agent I i yf JJT. Valuable consideration for a bill may valuable I, i • J. i. J 1 considoration : be constituted by — how constitut- (a.) Any consideration sufficient to support*''^* a simple contract ; (&.) An antecedent debt or liability ; such a debt or liability is deemed valuable consid- eration, whether the bill is payable on demand or at a future time : 2. Where value has at any time been given When holder for a bill, the holder is deemed to be a holder vaiue^'''' ^'''' for value as regards the acceptor and all parties to the bill who became parties prior to such time : 3. Where the holder of a bill has a lien on As to iien. it, arising either from contract or by impli- cation of law, he is deemed to be a holder for value to the extent of the sum for which he has a lien. (Ibid.) A Bill is primd facie presumed to have been ne- gotiated to the holder for value, and not to have been pledged or deposited as collateral security. The " discount " of a bill must be distinguished from the pledge or deposit of a bill as security. A discounter is a holder for full value. The holder of a bill as security must use due diligence with refer- ence to it. He must not part with it ; he must, if he can, collect it at maturity ; if he cannot he should protest the parties to it. Peacock v. Purcell (1863) 32 L. J. C. P. 266. A banker has, in the absence of an agreement to the contrary, a lien on all bills received from a customer in the ordinary course of banking business in respect of any balance that may be due from sucL customer. Chalmers, 77. i Accommoda- tion party to a bill. HiH liability, ; i Holdci" in duo course. i! t Title defec- tive in cases specitiod. 20 The Bills of Exchange Act, 1890. S8. An accommodation party to a bill is a person who has sij^ned a bill as drawer, accep- tor, or indorser, without receiving value there- for, and for the purpose of lending his name to some other person : 2. An accommodation party is liable on the bill to a holder for value j and it is immaterial whether, when such holder took the bill, he knew such party to be an accommodation party or not. (Ibid.) 2!>. A holder in due course is a holder 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 jjreviously dishonored, if such was the fact ; (b.) That he took the bill in good faith and for value, and that at the time the bill was negotiated to him he had no notice of any defect in the title of the person who negotiated it: Notice means actual knowledge, not necessar- ily formal notification. 2. In particular, the title of a person who negotiates a bill is defective within the mean- ing of this Act when he obtained the bill, or the acceptance thereof, by fraud, duress, or force and fear, or other unlawful means, or for an illegal consideration, or when he negotiates it in breach of faith, or under such circum- stances as amount to a fraud : The Civil Code of Lower Canada provides that error, fraud, violence or fear give a right of action or exception to annul or rescind contracts. Arts. 991, 1000. I i ( The Bills of Exchange Act, 1S90. 21 8. A holder, whether for value or not, who Hi(?ht of sub- derives his title to a bill thronjih a holder in Her/ due course, and who is not himself a party to any fraud or illegality affecting it, has all the rights of that holder in due course as reganls the acceptor and all parties to the bill prior to that holder. (Ibid.) S50. Every party whose signature appears on a bill is prima facie deemed to have become a party thereto for value : 2. xVnd every holder of a bill is prima facie deemed to be a holder in due course ; but if, in an action on a bill, it is admitted or proved that the acceptance, issue or subsequent nego- tiation of the bill is aifected with fraud, duress, or force jind fear, or illegality, the burden of proof that he is such holder in due course shall be on him, unless and until he proves that, subsequent to the alleged fraud or illegality, value has in good faith been given for the bill [by some other holder in due course :] {Ibid.) I'rosuinption of value and good faith. On whom bur- den of proof li(,'s. See Chalmers pp. 84-91 for illustration and ex- position of this section. [3. No bill, although given for a usurious consideration or upon a usurious contract, is void in the hands of a holder, unless such holder had at the time of its transfer to him actual knowledge that it was originally given for a usurious consideration, or upon a usurious contract :] (R. S. C. ch. 123, sec. 17.) [4. Every bill or note the consideration of which consists, in whole or in part, of the purchase money of a patent right, or of a partial interest, limited geographically or otherwise, in a patent right, shall have written or printed prominently and legibly across the face thereof, before the same is issued, the Usurious con sidoration. Consideration consisting of purchase money of patent right. Liability of transferee. Penalty. Negotiation of bUIs. 22 The Bills of Exchange Act, 1890. words '^ given for a patent right : " and without such words thereon such instrument and any renewal thereof shall be void, except in the hands of a holder in due course without notice of such consideration :] (R. S. C. ch. 123, sec. 12.) [5. The indorsee or other transferee of any such instrument having the words aforesaid so printed or written thereon, shall take the same subject to any defence or set-off in respect of the whole or any part thereof which would have existed between the original parties :] (R. S. C. ch. 123, sec. 13.) [6. Every one who issues, sells or transfers, by indorsement or delivery, any such instru- ment not having the words ^' given for a patent right " printed or written in manner aforesaid across the face thereof, knowing the consider- ation of such instrument to have consisted, in whole or in part, of the purchase money of a patent right, or a partial interest, limited geo- graphically or otherwise, in a patent right, is guilty of a misdemeanor, and liable to impri- sonment for any term not exceeding one year, or to such fine, not exceeding two hundred dollars, as the court thinks fit.] (R. S. C. ch. 123, sec. 14.) Sub-sections 3, 4, ^ and 6 are not to be found in the Imperial Act but as they already formed part of our law, they were incorporated in this act by Parlia- ment, for greater convenience. Negotiation of Bills. 31. A bill is negotiated when it is trans- ferred from one person to another in such a manner as to constitute the transferee the holder of the bill : " Holder " defined by sec. 2, (y) ante. I The mils of Krchnvf/r A rf, JSOO. 21) IS 2. A bill pjiyablo to boiirer is iicj^otiiitedToboaror. by delivery : " Bearer " and '' delivery " delinedby Bec.2,{d)(f). 3. A bill payable to order is ne<;()tiaterawing in- the interpretation of the drawing, indorse- &"?*''"*'" * ment, acceptance or acceptance supra prote? of a bill, is determined by the law of the plact where such contract is made : Provided, that where an inland bill is Proviso. indorsed in a foreign country, the indorsement shall, as regards the payer, be interpreted according to the law of Canada ; (c.) The duties of the holder with respect [>"Jie3 of to presentment for acceptance or payment and ^ ^^ ' the necessity for or sufficiency of a protest or notice ol dishonor, or otherwise, are deter- mined by the law of the place where the act is done or the bill is dishonored ; (d.) Where a bill is drawn out of but pay- currency. able in Canada, and the sum payable is not expressed ir. the currency of Canada, the amount shall, in the absence of some express stipulation, be calculated according to the rate of exchange for sight drafts at the place of payment on the day the bill is payable ; (e.) Where a bill is irawn in one country Duo date, and is payable in another, the due date thereof is determined according to the law of the place where it is payable. (Ibid. sec. 72.) (/.) If a bill or note, presented for accep- Evidence of tance, or payable out of Canada, is protested ^^° '^^ ' 54 The Bills of Exchange Act, 1890. for non-acceptance or non-payment, a notarial copy of the protest and of the notice of dis- honor, and a notarial certificate of the service of such notice, shall be received in all ' Durts, as prima facie evidence of such protest, notice and service.] PART III. i Cheque de- fined. Certain provi- sions to app]}\ Presentment of cheque for payment. CHEQUES ON A BANK. T2. A cheque is a bill of exchange drawn on a bank, payable on demand : See section 2 sub-sec. (c) for definition of "Bank." 2. Except as otherwise provided in this part, the provisions of this Act applicable to a bill of exchange payable on demand apply to a cheque. {Ihid. sec. 73.) See Cheques compared with and distinguished from Bills of Exchange, McrchanVa Bank vs. State Bank, Supreme Court of the United States. 10 Wallace, 647. 78. Subject to the provisions of this Act — («.) Where a cheque is not presented for payment within a reasonable time of its issue, and the drawer or the person on whose account it is drawn had the right at the time of such presentment, as between him and the bank, to have the cheque paid, and suffers actual damage through the delay, he is discharged to the extent of such damage, that is to say, to the extent to which such drawer or person is a creditor of such bank to a larger amount than he would have been had such cheque been paid ; (b.) In determining what is a reasonable The Bills of Exchange Act, 1890. 65 time, regard shall be had to the nature of the instrument, the usage of trade and of banks, and the facts of the particular case ; (c.) The holder of such cheque, as to which such drawer or person is discharged, shall be a creditor, in lieu of such drawer or person, of such bank to the extent of such discharge, and entitled to recover the amount from it. (Ibid, sec. 74.) This F^aon is very badly drawn and without Judge C i .mers explanation, would be quite unin- telligible. The effect of sub-sections a and c appears to be this : — A person draws a cheque for $500 on his Bank. Cheque is not presented for payment within a reasonable time. The Bank becomes insolvent, the drawer having at the time suflQcient funds at his credit in the Bank to meet the cheque. The drawer is discharged but the holder can rank for $500. against the Bank. If however, drawer had no funds but was authorized to overdraw, the drawer would be discharged but the holder could not rank against Bank. See Chalmers^ 232. ■74. The duty and authority of a bank to Revocation of pay a cheque drawn on it by its customer are Ju"!' ^ ^"'*^°' terminated by — (a.) Countermand of payment ,• (b.) Notice of the customer's death. {Ibid. sec. 75.) or rossed Cheques. "75. Where a cheque bears across its face an General cross- addition of- inK defined. (a.) The word ^'bank" between two pa- rallel transverse lines, either with or without the words ^' not negotiable ; " or — (b.) Two parallel transverse lines simply, either with or without the words '^ not nego- tiable j" 66 The Bills of Exchange Act, 1890. Special cross- ing. That addition constitutes a crossing, and the cheque is crossed generally : 2. Where a cheque bears across its face an addition of the name of a bank, either with or without the words '' not negotiable," that ad- dition constitutes a crossing, and the cheque is crossed specially and to that bank. {Ibid, sec. 76.) I Crossing by drawer or after issue. General or special. May be varied. Words may be ad led. !Re-crossing I'or collection. Crossing by bank. Uncrossing crossed cheque material part of cheque. TO. A cheque may be crossed generally or specially by the drawer : 2. Where a cheque is uncrossed, the holder may cross it generally or specially : 3. Where a cheque is crossed generally, the holder may cross it specially : 4. Where a cheque is crossed generally or specially, the holder may add the words '' not negotiable •" 5. Where a cheque is crossed specially the bank to which it is crossed may again cross it specially, to another bank for collection : 6. Where an uncrossed cheque, or a cheque crossed generally, is sent to a bank for collec- tion, it may cross it specially to itself : {Ibid, sec. 77.) [7. A crossed cheque may be reopened or uncrossed by the drawer writing between the transverse lines, and initialling the same, the words ^' pay cash."] TT. A crossing authorized by this Act is a material part of the cheque ; it shall not be lawful for any person to obliterate or, except as authorized by this Act, to add to or alter the crossing. {Ibid. sec. 78.) Duties of bank •78, Where a cheque is crossed specially to cheques. ' more than one bank, except when crossed to another bank as agent for collection, the bank and The Bills of Exchange Act, 1S90, 57 on which it is drawn shall refusi; payment thereof : 2. Where the bank on which a cheque so Liability for crossed is drawn, nevertheless pays the same, mcK?^^'^ ^^^ or pays a cheque crossed generally otlierwise than to a bhik, or, if crossed specially, other- wise than to the bank to which it is crossed, or to the bank acting as its agent for collection, it is liable to the true owner of the ciie(|ue for any loss he sustains owing to the cheque having been so paid : Provided, that where a cheque is presented ^,^'hcn liability for payment which does not at the time of pre- crue. sentment appear to be crossed, or to have had a crossing which has been obliterated, or to have been added to or altered otherwise than as authorized by this Act, the bank paying the cheque in good faith and without negligence shall not be responsible or incur any liability, nor shall the payment be questioned by reason of the cheque having been crossed, or of the crossing having been obliterated or having been added to or altered otherwise than as authorized by this Act, and of payment having been made otherwise than to a bank or to the bank to which the cheque is or was crossed, or to the bank acting as its agent for collection, as the case may be. (Ibid. sec. 79.) 71>. Where the bank, on which a crossed Protection to cheque is drawn, in good faith and without drawer whore negligence pays it, if crossed generally, to acfSd!^ bank, or, if crossed specially, to the bank to which it is crossed, or to a bank acting as its agent for collection, the bank paying the cheque, and if the cheque has come into the hands of the payee, the drawer, shall respect- ively be entitled to the same rights and be placed in the same position as if payment of 68 The Bills of Exchange Act, 1890. the cheque had been made to the true owner thereof. {Ihid. sec. 80.) EfTect of cross- SO. Where a person takes a crossed cheque ing on holder. ^jji(.ij ^ears on it the words '^ not negotiable," he shall not have and shall not be capable of giving a better title to the cheque than that which had the person from whom he took it. (Ibid. sec. 81.) Proctection to collecting bank. 81, Where a bank, in good faith and with- out negligence, receives for a customer pay- ment of a cheque crossed generally or specially to itself, and the customer has no title, or a defective title thereto, the bank shall not in- cur any liability to the true owner of the cheque by reason only of having received such payment. {Ibid. sec. 82.) The practice of crossing cheques originated at the clearing-house ; the clerks of the different bankers who did business there having been ac- customed to write across the cheques the names of their employers so as to enable the clearing-house clerks to make up their accounts. It afterwards became a common practice to cross cheque which were not intended to go through the clearing-house at all, with the name of a bank oi banker, or with the words " & Co." The effect of this custom is that where a cheque is thus crossed, bankers gen- erally refuse to pay it to any one except a banker ; and if they do pay it to a person not a banker, they consider that they do so at their peril, in the event of the party to whom the payment is made not being entitled to receive it. The object is, that the person for whose use the money was received, may be easily traced. In Bellamy v. Marjoribanks, 7 Ex-chec[uer Re- ports, 402, Baron Parke is reported as saying : " There can be no doubt but that the usage " of crossing cheques is highly beneficial to the " public. Cheques are in their essential character *' payable to bearer ; they are in manv respects " treated as bank notes, for which of late years The Bills of Exchange Act, 1890. 59 } owner cheque tiable," )able of an that took it. d with- er pay- pecially le, or a not in- of the ed such lated at iififerent ieen ac- ames of K-house Brwards e which g-house or with stom is rs gen- )anker ; r, they e event de not hat the id, may er Re- J usage to the iracter Bspects years (( (( (( (< (I (( (( (( it (C (( (( (C (C (( they have been largely substituted ; but like all other things they are liable to be mislaid, or lost, or stolen, and may get into the hands of persons who are not entitled to receive payment of them. It is manifestly therefore a great protection and safe guard to the real owner, that there should exist the means of tracing and ascertaining for whose use the money paid on a cheque is re- ceived, and to whom the money actually goes. Payment through a banker secures this object. We think therefore, that it is a matter of great public advantage and benefit that this custom or usage should be maintained ; and we think it well may without at all improperly trenching upon or restricting the negotiability of cheques." PART IV. PROMISSORY NOTES. 82. A promissory note is an unconditional Promissory promise in writing made by one person to an- "o*- defined. other, signed by the maker, engaging 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 : See note to sec. 3. An instrument promising to do anything in addition to the payment of money is not a Pro- missory Note, but in New- York an instrument reading " I promise to pay C. or order 100 dollars or in goods on demand " was held to be a valid note. Oatater v. Wilaon, 31 Barb. 307. An I. O. U. is merely an acknowledgement of debt, and is not a Promissory Note. Gould V8. Coombs,! C. B. 543. 2. An instrument in the form of a note pay- indoibcment able to maker's order is not a note within the '^^ '"**''®^" meaning of this section, unless and until it is indorsed by the maker : Inland and foreign. I 60 The Bills of Exchange Act, 1890. Collateral 3. A note is not invalid by reason only that no*t invafidato. it Contains also a pledge of collateral security with authority to sell or dispose thereof : 4. A note which is, or on the face of it pur- ports to be, both made and payable within Canada, is an inland note : any other note is a foreign note. {Ibid. sec. 83.) 83. A promissory note is inchoate and in- complete until delivery thereof to the payee or bearer. (Ibid. sec. 84.) Inchoate i. e. incomplete and inoperative. Joint and H4. A promissory note may be made by two several notes, ^j, n^Qj-g makers, and they may be liable there- on jointly and severally, according to its tenor : As to number. 2. Where a note runs '' I promise to pay," and is signed by two or more persons, it is deemed to be their joint and several note. {Ibid. sec. 85.) Delivery ne- cessary. / Note payable on demand. I Reasonable time. 85. Where a note payable on demand has been indorsed^ it must be presented for payment icithin a reasonable time of the indorsement : if it is not so inesented, the indorser is discharged : [if, however, with the assent of the indorser it has been delivered as a collateral or con- tinuing security it need not be presented for payment so long as it is held as such security :] By sec. 10 read with sec. 88 a note is payable on demand which is expressed to be so payable, or at sight, or on presentation or in which no time for payment is specified. 2. In determining what is a reasonable time, regard shall be had to the nature of the in- strument, the usage of trade, and the facts of the particular case : The Bills of Exchange Act, 1S90. (il ly that ecurity f : it pur- within ote is a and in- ) payee by two 3 there- i tenor : 3 pay," s, it is 1 note. nd has ayment ent : if arged : idorser or con- ted for iirity :] able on able, or :ime for e time, the in- acts of 3. Where a note payable on demand is ne- Defects with- gotiated, it is not deemed to be overdue, for°"^"°"^®' the purpose ofaflfecting the holder with defects of title of which he had no notice, by reason that it appears that a reasonable time for pre- senting it for payment has elapsed since its issue. (Ibid. sec. 86.) Jitt. Where a promissory note is in the Presentment body of it made payable at a particular place, plyment?^ it must be presented for payment at that place. But the maker is not discharged by the omis- sion to present the note for payment on the day that it matures. But if any suit or action is in- stituted thereon against him before present- ation, the costs thereof shall be in the dis- cretion of the court. If no place of payment is specified in the body of the note, presentment for payment is not necessary in order to render the maker liable : Hon. Mr. Kaulbach:— Is that not a large dis- cretion allowed to the Court? If the Note is not presented, why not make the party who sues, liable for the costs ? Hon. Mr. Abbott : — Because the party who made the note may not have provided any money at the place of presentment, and that relieves the h'^lder from the necessity of presenting it there. The judge will only exercise discretion in cases where the money is provided at the place of payment. Senate Debates 1890, P. 506. 2. Presentment for payment is necessary in Liability. order to render the indorser of a note liable. 3. Where a note is in the body of it made J'Jjf;;^^^^ Pre- payable at a particular place, presentment at that place is necessary in order to render an indorser liable ; but when a place of payment is indicated by way of memorandum only, pre- sentment at that place is sufficient to render the indorser liable, but a presentment to the 62 The Bills of Exchange Act, 1890. Liability of maker. Application of part II to notes. Correspond- ing terms. 1 1 • i .1 i What provi- sions do not apply. As to foreign note. maker elsewhere, if sufficient in otlier respects, shall also suffice. (2) {Ibid. sec. 87.) (2.) Article 145 Code of Civil Procedure provides: " In the case of Promissory Notes or Bills of Ex- change payable at a particular place, they are E resumed, as against the maker or acceptor, to ave been presented at that place at maturity, un- less the exception founded upon such want or pre- sentation is accompanied with an affidavit, that, at the time they became due, provision had been made for their payment at the specified place." 87. The maker of a promissory note, by making it — (a.) Engages that he will pay it according to its tenor ; (b.) Is precluded from denying to a holder in due course the existence of the payee and his then capacity to indorse. {Ibid. sec. 88.) 88. Subject to the provisions in this part, and except as by this section provided, the provisions of this Act relating to bills of ex- change apply, with the necessary modifica- tions, to promissory notes : 2. In applying those provisions the maker of a note shall be deemed to correspond with the acceptor of a bill, and the first indorser of a note shall be deemed to correspond vt^ith the drawer of an accepted bill payable to drawer's order : 3. The following provisions as to bills do not apply to notes, namely, provisions relating to — {a.) Presentment for acceptance j (6.) Acceptance ; (c.) Acceptance suprd protest ; {d.) Bills in a set : 4. Where a foreign note is dishonored, pro- test thereof is unnecessary, except for the pre- servation of the liabilities of indorsers. {Ibid, sec. 89.) jpects, ovides: of Ex- ley are tor, to ity, un- 01 pre- that, at mmade Dte, by iording holder ee and . 88.) is part, ed, the ^ of ex- odifica- maker with idorser d with iVjle to do not ng to — )d, pro- he pre- {Ibid. The BilU of Exchange Act, 1800. 03 PART V. SUPPLEMENTARY. SO. A thing is deemed to be done in good ^ 'o^ 'a>th- faith within the meaning of this Act, where it is in fact done honestly whether it is done ne- gligently or not. {Ihid. sec. 90.) 90. "Where, by this Act, any instrument or signature. writing is required to be signed by any person, it is not necessary that he should sign it with his own hand, but it is sufficient if his signa- ture is written thereon by some other person by or under his authority : A pencil signature has been held sufficient Oeary vs. Physic 5 B C. 234. Where a Note ran " I William Smith promise to pay " instead of" I promise to pay" with signature in the usual place ; Held : — a sufficient signature Taylor vs. Dobbin, 1 Stra. 399. 2. In the case of a corporation, ivhere, by f/i is As to corpora- te^, any instrument or writing is required to be ^*'"^' signed, it is sufficient if the instrument or writing is duly sealed with the corporate seal ; but nothing in this section shall be construed as requiring the bill or note of a corporation to be under seal. (Ibid. sec. 91.) 91. Where, by this Act, the time limited computation for doing any actor thing is less than three days, in reckoning time, non-business days are excluded : '' non-business days," for the pur- poses of this Act, mean the days mentioned in the fourteenth section of this Act ; any other day is a business day. {Ibid. sec. 92.) When notinK ia equivalent to protest. Protest when notary is not accessible. Expenses. Fees charge- able. Forms. Evidence of Sresentation, ishonor and notice. 64 The Bllh of Exchange Act, 1890. 1>3. For the purposes of this Act, where a bill or note is required to be protested within a specified time or before some further pro- ceeding is taken, it is sufficient that the bill or note has been noted for protest before the expiration of the specified time or the taking of the proceeding ; and the formal protest nuiy be extended at any time thereafter as of the date of the noting. (Ibid, sec. 93.) 0;5. Where a dishonored bill is authorized or required to be protested, and the services of a notary cannot be obtained at the place where the bill is dishonored, any justice of the peace resident in the place may present and protest such bill and give all necessary notices, and shall have all the necessary powers of a notary in respect thereto : Under the Imperial act these formalities may be observed through " any householder or sub- stantial resident." [2. The expense of noting and protesting any bill or note, and the postages thereby in- curred, shall be allowed and paid to the holder n addition to any interest thereon :] [3. Notaries may charge the fees in each Province heretofore allowed them :] 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 behalf made in the forms : 5. A protest of any bill or note, and any copy thereof as copied by the notary or justice of the peace, shall, in any action he prima facie evidence of presentation and dishonor, and I where a 1 witliin ler pro- the hill fore the B taking est may 8 of the 3horized services le place stice of present 3cessary ' powers les may or 8ub- )testing eby in- holder n each his Act ny bill A. copy nay be bill or hanges id any justice d facie and The Bills of Exchange Act, 1890. 65 also of service of notice of such presentation and dishonor as stated in such protest. {Ihid. sec. 95.) 94. The provisions of this Act as to crossed Dividend war- cheques shall apply to a warrant for payment Jrowcd.*^ ^® of dividend. {Ihid. sec. 95.) 05. The enactments mentioned in the second Hopcai. schedule to this Act are hereby repealed, as from the commencement of this Act, to the extent in that schedule mentioned : Provided, that such repeal shall not affect I'roviao. anything done or suffered, or any right, title or interest acquired or accrued before the commencement of this Act, or any legal i)ro- ceeding or remedy in respect of any such thing, right, title or interest: {Ibid. sec. 96.) 2. Nothing in this Act or in any repeal " Tho Bank affected thereby shall affect the provisions of ,fffocted'^ " The Bank Act:'' 3. The Act of the Parliament of Great Brit- imperial Acts 15 ipt Ge ain passed in the fifteenth year of the reign of c^'aifamiM':, His late Majesty George III, intituled " Au g,«»;^^^^{|^c. ' Act to restrain the negotiation of Promissory apply. Notes and Inland Bills of Exchange under a limited sum within that part of Great Britain called England," and the Act of the said Par- liament passed in the seventeenth year of His said Majesty's reign, intituled '' An Act for further restraining the negotiation of Promis- sory 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 said Acts make void any bills, notes, drafts or orders which hare been or may be made or uttered therein. ft 66 The Bills of Exchange Act, 1890. ^^^^ ** ^^ "°*** ** ^o *^® sum for which a Bill of Exchange, Promissory Note or Cheque, may be Construction with other Acts. &c. 'I- i '4 ' «^ I Comnience- ment of Act. »«• Where any Act cr document refers to any enactment repealed by this Act, the Act or document shall be construed and shal oper- ate as if it referred to the corresponding pro- risions of this Act. (iWaf. sec, 99.) [97- This Act shall come into force on the first day of September next.] 11 ' 11 ir I i ^ 3h a Bill , may be efers to bhe Act 1 oper- »g pro- on the FIKST SCHEDULE. Form A. NOTING FOE NON-ACCEPTANCE. {Copy of Bill and Indorsements.) ^^ the 18 , the above Bill was, by me, at the request of , presented for acceptance to E. P., 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 bill is therefore noted for ron-acceptauce. A. B., Notary Public. (Date and place.) 18 Due notice of the above was by me served f A B ) *^® jindorse'r, [ Personally, on the day of (or, at his residence, office or usual place of business) ia , on the day of (or, by depositing such no' ce, direcr^c to him, at , in Her Majesty's j^- >>st office in the city [town or village], on the day of , and prepaying the postage thereon.) A. B., Notary Public. (Date and place.) 18 68 Schedule. — Forma. Form B. protest for non-acceptanoe or for non-payment of a bill payable generally. {Copy of Bill and Indorsements.) On this day of , in the year 18 I, A. B., notary public for the Province of , in the Province of at the dwelling; at request of , did exhibit the original bill of exchange, whereof a true copy is above written, unto E. F., the {acceptor j t^iereof personally {or, at his re- sidence, office or usual place of business) in , and, peaking to himself {or his wife, his clerk, or his servant, &c.,) did demand {paymen^^^l ^^^^reof ; unto which demand \ , > answered : '* ." "Wherefore I, the said notary, at the request aforesaid, have i^rotested and, by these presents do protest against the acceptor, drawer and indorsers {or drawer and in- dorsers) of the said bill, and other parties thereto or therein concerned, for all exchinge, re-exchange, and all costs, damages and interest, present and to '^ome, for want of { ^^^y^P^^-^r' } ^' *"« «»"' '■^'"- All of which I attest by my signature. (Protested in duplicate.) A. B., Notary Public. Schedule. — Forms. 69 n FOEM 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, whereof a true copy is above written, unto E. F. the I drawee ) thereof, at , being the stated (acceptor j ' place where the said bill is payable, and there, speakir.g did demand {--£-} of the ^O u 5> ^ald bill ; unto which 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 (f»- drawer -md in- dorsers) 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 (acceptance | of the said bill. ( payment j All of which 1 attest by my sii';nature. (Protested in cuplicate.) A. B., Kotnri/ Puhlie. 70 Schedule. — Forme. Form D. 1? i'l PEOTEST FOB NON-PAYMENT OF A BILL NOTED, BUT NOT PROTESTED, FOR NON-ACCEPTANCE. If the protest is made by the same notary who noted the hill J it should immediately follow the act of noting and mem- orandum of service thereof^ and begin with the words '' and afterwards on, &c.y^^ continuing as in the last preceding forniy biit introducing between the words '^ did " and ** ex- hibit," 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-acceptance on the day of " But if the protest is not made by the same notary^ then it should follow a copy of the original bill and indorse- ments and noting marked * n the bill — and then in the pro- test introduce, in a parenthtsis, 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." *.:% Schedule. — Forms. 71 Form E. PROTEST FOR NON-PAYMENT OF A NOTE PAYABLE GENERALLY. {Gojyy of Note and Indorsements.) On this (lay 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 pron\issory note, whereof a true copy is above written, unto , the promisor, personiiliy {or, at his resi- dence, office or usual place of business), in , and speaking to himself (or his wife, his clerk or his servant, &c.), di(l demand payment thereof ; unto which demand I ?^1 answered: '' (she) 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. All of which I attest by my signature. (Protested in duplicate.) A. B., Notary Public. 72 Schedule. — Forms. Form F. « ;i . PROTEST FOR NON-PAYMENT OF A NOTE PAYABLE AT A STATED PLACE. {Copy of Note 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 promissory note, whereof a true copy is above written, unto the promisor, at , being the stated place where ihe said note is payable, and there, speaking to did demand payment of the said note, unto which demand he answered : '' ." Wherefore 1, 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. All which I attest by my signature. (Protested in duplicate.) A. B., Notary Public, Schedule. — Forms. 78 Form G. notarial notice of a noting, or of a protest for non-acceptance, or of a protest for non-payment of a bill. {Place and date of Noting or of Protest.) 1st. To P. Q,. (the drawer.) at Sir, Your bill of exchange for $ , dated at the , upon E.F., in favor of CD., payable days after I ^ig'^*? 1 ^as this day, at the request of , , ( noted ) 1 4- f iion-a;.oeptance. ") *i^ly {protested PJ^^^^^^M non-payment. } A.B., Notary Public. {Place and date of Noting or of Protest.) 2nd. To C. D. {indorser), {orF.G:) at Sir, Mr. P.Q. 's bill of exchange for $ , dated at , the , upon E.F., in your favor {or in favorof CD.,) payable days after | ^^^J^J^' | and by you indors- ed, was this day, at the request of , duly ( noted ) , f ( non-acceptance. ) I protested } ^^ "'® ^^"^ { non-payment. | A. B., Notary Public. r I I II; 74 Schedule. — Forms. Form H. notarial notice of protest of non- payment of a note. To 1 at Sir, Mr. P.Q.'s promissory note for $ , dated at, (' months "^ , the payable < days > after date to (on ) j F^F I ^^ order, and indorsed by you, was this day, at , duly protested by me for non- the request of payment. A.B.. Notary Public, "« Schedule. — Forms. 75 dated at, r date to is day, at B for non- Puhlic. I Form I. NOTARIAL SERVICE OF NOTICE OF A PROTEST FOR NON- ACCEPTANCE OR NON-PAYMENT OF A BILL, OR OF NON-PAYMENT OF A NOTE {to he Subjoined to the Protest.) And afterwards, I, the aforesaid protesting notary pub- lic, did serve due notice, in the form prescribed by law, of the foregoing protest for { non^parmeX^ } ^^ ^^^ 1 note I *^®^®^y protested upon | ^' §• ' | the { fndoTers } P—"^' «" *« day of {pr^ at his residence, office, or usual place of business) in , on the day of ; {or^ by depositing such notice, directed to the said fP.Q.,) (C.D..J 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 PuUic. 76 Schedule. — Forriia. i I :l i 4 Form J. PROTEST BY A JUSTICE OF THE PEACE (WHERE THERE IS NO notary) for non-acceptance of a bill, or NON-PAYMENT OF A BILL OR NOTE. (Copy of Bill or Note and Indorsements.) On this day of , in the year 18 , 1.N.O., one of Her Majesty's justices of the peace for the district (or county,&c.), of , in the Province of , dwelling at (or near) the village of , in the said district, there being no practising notary public at or near the said village (or any other legal cause) ^ did, at the request of and in the presence of well known unto me, exhibit the original ] ■ \ whereof a true copy is above written, unto P. Q., the ! drawer ") acceptor > thereof, personally (or at his residence, promisor ) office or usual place of business) in and speaking to himself (his wife, his clerk or his servant, &c.), did demand I p^^^P*^"^® | thereof, unto which de- mand ] -^ \ answered : *^ ." Wherefore I, the said justice of the peaee,at the re- quest aforesaid, have protested, and by these presents ( drawer and indorsers "| do protest against the •! promisor and indorsers >■ (acceptor, drawer and indorsers) " Schedule. — Forms. 77 of the said | ^H^ 1 and all other parties thereto and therein concerned, for all exchange, re-exchange, and all costs, damages and interest present and to come, for want of ( acceptance \ \ payment j of the said f bill. ( note .1 All which is by these presents attested by the signature of the said (the witness) and by my hand and seal. (Protested in duplicate.) {Signature of the xoitness.) {Signature and seal of the J. P.) IMAGE EVALUATION TEST TARGET (MT-3) /. A y, ^ 1.0 I.I 11.25 If iM m I !| ma S- li£ 12.0 1.8 \A. 11 1.6 v] <^ /] 7 ^ v>* ^%:^»^^v 7 "4V> -(^ Photographic Sciences Corporation 23 WEST MAIN STREET WEBSTEM.N.Y. 14580 (716) 873-4503 m. '<^ \ ,v \ ^ % V ■<^A Ci^ -o" .*, .<^,'^ <1> I ci^ ■PVl mgammm SECOND SCHEDULE. ENACTMENTS REPEALED. Province and Chapter. Ill \ Dominion of Canada : Chap. 123, Revised Statutes Province of Cuebec : Civil Code of Lower Canada Nova ' -v^tia : Reviseo Statutes, third series s.i,u82 New Brui 'T v^rick : Revised ^_-tatutes, chap. 116, 30Vic., 186T, chap. 34. Title of Act and extent of repeal. An Act respecting Bills of Exchange and Prom- issory Notes.— The whole Act. Articles 2,279 to 2,354, both inclusive [*] " Of Bills of Exchange and Promissory Notes." Section 2. The other sections of this chapter have been heretofore repealed. " Of Bills, Notes and Choses in Action." Section 2. The other sections of this chapter have been heretofore repealed. An Act to amend chap. 116 of the Revised Stat- utes, "Of Bills, Notes and Choses in Action ;" also Act 12th Victoria, chapter 39, relating thereto. Section 1. [*Except in so far as such articles, or any of them, relate to evidence in regard to bills of exchange, cheques and promissory notes.] These articles are 2341 and 2342, which read as follows : 2341. In the investigation of facts, in actions or suits founded on bills of exchange drawn or endorsed either by traders or other persons, recourse must be had to the laws of England in force at the time specified in the last preceding article (30th May 1849) and as additional evidence is required or can be adduced by reason of any party to the bill not being a trader. 2342. The parties in the actions or suits specified in the last preceding article may be examined under oath as provided in the title of Obligations. INDEX. peal. e and Prom- ory Notes." ;m8 chapter " Section 2. have been ivised Stat- Q Action ;" 59, relating vidence in irticles are of facte, in 'by traders orce at the additional he bill not n the last »e title of the numbers refer to the sections op the act. Acceptance defined 2 17 delivery or notification to compieie.'ll^'..'.''.'. ' 21 renunciation of, by holder 62 revocation of, by drawee 21 must be signed, and on bill " 17a date, how supplied ■.''■■"!!.' 12, 18 bill m a set 70 Time of : before bill complete as to form la on after maturity jn' i« after dishonor '.'.Z.'^Z ' 13 presumption when undated ..........................*.* 18 By whom : in general by drawee 17 by one of several drawees !!!!!!"!..!!!!.....! 19 by drawee in assumed name 23 by fictitious persons 5 41 by corporation ",'*.".".' ' 22 forged or unauthorized 24 when general ......."!. 19 when qualified jg option to take qualified ................'.'..'.'.*.*.".".'.'.' 44 Acceptance for Honor supra Protest what bills may be so accepted and when «^ effect of accepting " ^l must be protested S2 00 Acceptor defined 3 for accommodation 28 signature of. ..........."............!!. 23 I j: i * 80 Index. Acceptor— Continued. damages against 57 notice of dishonor not necessary to 52 presentment to 52 liability of. 54 Accommodation Bill defined 28 value subsequently given for 27 presentment for payment when excused 46 notice of dishonor when excused 50 Action includes counterclaim and ^-et off. 2 holder may bring, in his own name 38 lost bill ornote 68 costs of. 52,56,86, 93 Address sufficiency of, when notice sent by post and lost 49 of drawer or indor^er of dishonored bill not known 50 to drawee in bill 6 After Date ^Bill Payable) omission of date 12 entitled to days of grace 14 r Iculation of maturity 14 presentment for acceptance, when necessary 39 acceptance after maturity 10 presumed time of undated acceptance 18 After Sight (Bill Payable) entitled to days of grace 14 computation of maturity 14 presentment for acceptance required 39 when presentment is excused 41 Agent 26 Allonge 32 Alteration what material 63 effect of material on bill 63 Ante-dated Instruments 13 I I Index. 81 57 52 52 54 28 27 46 50 2 38 68 93 49 50 6 12 14 14 39 10 18 14 14 39 41 26 32 63 63 13 Bank and Banker bank defined ^ 2 lien on customer's bill 27 paying forged cheque or bill 24 duty when cheque crossed to more than one 78 receiving payment of crossed cheque for customer 81 payment of crossed cheque by 79 protection of, as to crossed cheques 78 Beabeb defined 2 included in term "holder" 2 Bill Payable to, defined 8 Better Security protest for 81 Bill op Exchange definition 3 form and interpretation 3-21 capacity of parties 22 authority of parties. forgery 24 consideration for. See Consideration. duties of holder 30, 52 Bills of Exchange Act 1890 changes in law effected by. See Introduction. not retrospective 2 applies only to bills, notes and cheques 2 acts repealed by 95 Blank, or Blank Signature Indorsement in Blank. definition 34 effect 34 conversion into special 34 Bona Fides bond fide holder 29 test of, in holder 29 presumption of, in holder 30 Business Days what are, or are not 91 6 9P : r I 82 Index. Capacity general rule 22 Cancellation of bill or signature by holder 62 if by mistake 62 acceptance by drawee 21 indorsement by indorser 21 Case of Need meaning of term 15 designated by indovser 15 cannot accept without protest 66 option of holder to present in 15 Cheque defined 72 provisions as to bills, how far applicable to 72 when deemed overdue or stale 36 payment by banker when held un^ar forged 24 is not a Q assignment of funds 53 Crossed geaeral and special crossings 76 who may c-'oss 77 meaning and effect of '' not negotiable " 80 alteration of crossing 77 Collateral Security effect whea bill held as 27 Company and Corporation capacity to incur liability 22 seal or sigaature of ,.... 90 Conditional acceptance 3, 11, 83 indorsement 33 Conflict of Laws rules aB to 71 Consideration what constitutes 27 pro tanto In case of pledge or lien 27 .... 22 62 .... 62 21 21 15 15 66 15 72 72 36 24 53 76 77 80 77 27 22 ...... 90 3, 11, 83 33 71 27 27 Index. 83 Consider ATioN— Con< I n wed . want of, creating privity between remote parties 30 presumption of 30 holder fot value 27 holder in due course 29 Costs 52, 56, 86, 93 Crossed Cheque. See Cheque Damages (Measure of) 57 Date insertion ofj proper, bub not essential 3, 12 alteration of, material 63 iiiterest to be calcalated from ^9 Days op Grace 14, 71 Delivery 3 definition of. 3 necessity for, to complete contract 21 by whom it must be made 21 Demand {Bill or note payable on) expressed to beso payable 10 payable ^.t si^ht or on presentation 10 bill accented or indorsed after maturity is '. 10 discharge defined 59 Dishonor By non-acceptance. defined 43 consequences of. 43 By non-payment. defined 47 consequences of. 47 Drawee must be named 6 alternative 6 acceptance by 17 Drawee in Case of Need 15 'ft ff arr mssmmim 84 IH; Index. Dbawer. defined 3 forged or unauthorized signature of. 24 payment by, as a dischargr- 59 taking up bill in a set 71 Due Date how determined in general 14 conflict of laws 71 Equity Attaching TO Bill Fees Chargeable by Notaries. 36 93 Foreign Bill or Note defined 4 forged or unauthorized cignature 24 Forms A. Noting for non-acceptance 67 B. Protest of bill payable generally 68 C. Protest of bill payable at stated place 69 D. Protest of bill noted for non-acceptance 70 E. Protest of note payable generally 71 F. Protest of note payable at stated place 72 G. Notarial notice of noting or protest of bill 73 H. Notarial notice of protest of note 74 I. Notarial service of notice of protest 75 J. Protest by a justice of the peace 76 Good Faith test and definition of. 89 Grace, days of. 14 Holder defined 3 for value 27 Duties. presentment for acceptance 39 " " payment 45 protest of bill 51 Bights. further negotiation of bill 38 with defective title to give good title 38 to duplicate of lost bill 68 3 • ••••••• a4 69 71 14 71 36 93 4 24 67 68 69 70 71 72 73 74 75 76 89 14 3 27 ..... 39 45 51 .... 38 .... 38 68 Index. g5 Inchoate or incomplete bill or note gg Indorser included in term « holder " ' £ Indorsement defined delivery requisite* to compiete'.' '.■".■ ■" o o? revocation of, by indorser '.".".".'.'.'.'.'.".".'.V.V.V.'.'.".'."' 21 Indorsed defined revocation of indorsement .*.'.' '■■■. S how habiliW negatived by express" terms ■.'.■.■. Vr ^? Inland Bill defined presumption that biiris'V.'.V. ! 4 Instalments bill payable by Interest 9, 14 Interest proper from what date it runs. Lien as consideration for bill rights and duties of holder having.' Lost Bill 9 9 27 27 rights to duplicate, protest on copy. 68 51 69 payment where destruction pro v^^^^^^^ ^J Maker (of Note) defined damages against .. . ........... ..........'...".' ?? 57 Maturity of bill how computed ^ . acceptance after in ae Bt if|:j n 86 Index. Negotiability restrained by indorsement 35 Negotiation defined 31 " Not Negotiable " cheque may be specially so crossed 75 Notary Public when necessary ; fees &c. See Protest..... 51, 64, 71, 93 Notice of Dishonor To charge drawer or indorsers 48 defined 49 when necessary 48 consequence of omission to give 48 Noting defined 51 Order {Bill payable to) what bi'ls are 8 e^ect of omitting words " or order " 8 how negotiated 31 Overdue Bill negotiability of 36 Patent bill given for 30 Payee defined 7 included in term " holder " 2 Payment {of Bill) meaning of term 59 payment for honor suprS, protest 67 Post Office notice of dishonor sent through 49 presentment for acceptance through 41 " " payment through 45 1 1 35 31 75 , 64, 71, 93 48 49 48 48 51 8 8 31 36 30 7 2 59 67 49 41 45 Index. 87 Prescription 36 Presentment for Acceptance when necessary 39 consequence of omission when necessary 40 by whom to be made 41 to whom and when 41 day and hour 41 excuses for non presentment 41 Presentment for Payment consequence of omission 45 Principal and Agent liability of principal to holder 25 on instrument when unnamed 23 name signed by agent 26 forged signature 24 Promissory Note defined 82 how far provisions as to " bills " apply to 88 of corporation under seal without signature 90 payment suprS, protest 67 Protest what it is 51 founded on noting 51, 92 may be extended fi'om noting at aay time 51, 92 notice of. 49 consequeace of not protesting 51 at what time to be made 51 Ratification of forged or unauthorized signature 24 Reasonable Time presentment for acceptance 39 " " payment 45 notice of dishonor Referee in Case of Need 15, 67 Restrictive Indorsement what indorsements are 35 ■XBS i 88 Index. Revocation acceptaiice by drawee 21 indorsement by indorser 2i of delivery 21 Security protest for better 61 Set (bill drawn in) 70 Signature delivery to give effect to 21, 83 immaterial by what hand, if authorized what sufficient in point of form 90 of corporation 90 Special indorsement definition 34 effect 31, 34 distinguished from restrictive 35 Transferer by Delivery defined 58 Usurious Consideration, bill givenfor 30 Value defined 2, 27 Value Received construction of the term 3 Waiver of bill by holder 61 of liabilities of parties by holder 61 of presentment for payment 47 of protest.. 16, 51 of notice of dishonor 50 Without Recourse 16 1; ... 21 ... 21 ... 21 ... 61 ... 70 21,83 ".'.". 90 ... 90 ... 34 31,34 ... 35 .. 58 ,.. 30 . 2,27 .. 3 ... 61 ... 61 .. 47 16, 51 .. 50 .. 16 i) m