CHAP. IX. BILLS OF EXCHANGE AND PROMISSORY NOTES. I. Of the Nature of a Bill of Exchange. II. Of the Capacity of the contracting Parties to a Bill of Exchange. III. Of the Requisites in a Bill of Exchange, and herein of the Stamp, Date, and Consideration. IV. Presentment for Acceptance-Acceptance-qualified Acceptance-Liability of the Acceptor-Non-acceptance, and Notice thereof-Protest-Liability of the Drawer on Non-acceptance. V. Of the Transfer of Bills of Exchange-Of the Party in whom the Right of Transfer is vested. VI. Of Presentment for Payment, and herein of the Days of Grace-Non-payment and Notice thereof — Protest. VII. Of the Acts of the Holder, whereby the Parties to the Bill may be discharged. VIII. Of the Action on a Bill of Exchange-Pleading under the New Rules-Evidence-Recovery of Interest. IX. Of the Nature of a Promissory Note-Stat. 3 and 4 Ann, c. 9. s. 1, placing Promissory Notes on the footing of Inland Bills of Exchange-What are negotiable Notes within the Statute-Of Bankers' Notes -Joint and several Notes-Consideration-Stamp. X. Of the Time when a Note ought to be presented for Payment. XI. Of the Declaration-Pleadings-Evidence-Conclu I. Of the Nature of a Bill of Exchange. A BILL of Exchange is a written order from A. to B. directing B. (who has, or is supposed to have, in his hands, sufficient effects belonging to A.) to pay a sum of money to C. or order, or to C. or bearer, either at sight or a certain number of days after sight, or after date, or at single, double, or treble usance, or on demand. The peculiar properties of a bill of exchange are these: first-It is assignable to a third person not named in the bill, or party to the contract, so as to vest in the assignee a right of action in his own name: contrary to the general rule of law, that choses in action are not so assignable. Secondly-Although a bill of exchange be merely a simple contract, and not a specialty, yet it will be presumed that it has been originally given for a good and valuable consideration. Bills of exchange are either foreign or inland; foreign bills of exchange have long been considered as the most convenient paper security among merchants, in conformity to the universal usages and customs established among traders, by unanimous concurrence, for facilitating a general commerce throughout the world. The person making the bill is called the drawer, the person to whom it is directed the drawee, and the person in whose favour it is made the payee. When the drawee has undertaken to pay the bill, he is stiled the acceptor, and his undertaking to pay the bill is called an acceptance. No one can be liable as acceptor but the person to whom the bill is addressed", unless he be an acceptor for honour. Bills of exchange payable to order are assignable by indorsement. The person making an indorsement is called the indorser; the person in whose favour it is made, the indorsee; the party in possession of the bill, and entitled to receive its contents, the holder. Bills payable to bearer are transferable by delivery without indorsements. Where the drawee refuses to accept, a stranger, after protest for non-acceptance, may accept for the honour of the drawer, and thereby such stranger acquires certain rights, and subjects himself to the same obligations as if the bill had been directed to him. So a stranger may become a party to a bill, paying it after protest for non-payment, either for the honour of the drawer or indorsers. Although regularly there ought a Postleth. Dict. b Per Lord Tenterden, C. J. delivering judgment in Polhill v. Walter, 3 B. & Ad. 122. See stat. 6 and 7 W. 4. c. 58. post. e Grant v. Vaughan, 3 Burr. 1516. to be three persons concerned in a bill of exchange, viz. drawer, drawee, and payee, yet there may be only two; that is, the characters of drawer and payee may be, and frequently are, united in the same person, as if A. draw a bill in this manner: "Pay to me or my order £ Value received by myself." A bill of exchange is a simple contracte, and consequently is within the statute of limitations; and must be sued for within six years after it becomes payable. In an action by an administrator, upon a bill of exchange payable to the testator, but accepted after his death, it was holden, that the statute of limitations begins to run from the time of granting the letters of administration, and not from the time the bill becomes due, there being no cause of action until there is a party capable of suing. An agent having money in his hands belonging to his principal, purchases with it a bill of exchange, which he indorses specially to his principal; the latter, at the time of the indorsement, was dead, but that fact was not known to the agent; it was holden, that the property in the bill passed to the administrator of the principal, and that he might, therefore, sue upon the bill in that character; it was holden, also, that the administrator was only entitled to recover interest upon bills accepted after the death of the testator, from the time of demand of payment made by the administrator, and not from the time the bills became due. Where the declaration stated the drawing of certain bills of exchange, and their acceptance after the death of the intestate, the granting of the letters of administration to the plaintiff, the defendant's liability, &c.; and the defendants pleaded that the cause of action did not accrue within six years; to which the plaintiff replied generally, that it did accrue within six years it was holden, that the replication was good. Bills of exchange for value received, are not such matters of account as are intended by the exception in the statute of limitations concerning merchants' accounts. A bill of exchange is to be considered as a simple contract debt in a course of administration, which an executor or administrator cannot discharge before debts by bond, without being guilty of a devastavit. If a merchant in London draws a bill of exchange on his correspondent in Newcastlek, in favour of J. S. and the bill is refused, and J. S. dies intestate, his administrator, on letters d Per Holt, C. J. in Buller v. Cripps, g Murray v. East India Company, 5 B. 6 Mod. 30. e Renew v. Axton, Carth. 3. and A. 204. h Ib. f Murray v. East India Company, 5 B. i Chevely v. Bond, Carth. 226. and A. 204. k Yeomans v. Bradshaw, Carth. 373. of administration taken out at Durham, cannot bring an action on the custom of merchants against the drawer, and lay the same in London, because a bill of exchange is not equal to a bond or specialty, which are the deceased's goods where they happen to be at his death, but is a simple contract which follows the person of the debtor, and makes bona notabilia where the debtor resides, and therefore administration ought to be taken out in London. II. Of the Capacity of the contracting Parties to a Bill of Exchange. ALL persons, whether merchants or not, if they have capacity to contract, may be parties to a bill of exchange. This appears from the case of Sarsfield v. Witherly, Carth. 82, in which it was decided, that the act of drawing a bill of exchange constituted the drawer a merchant, within the custom of merchants, so as to make him responsible to the holder upon non-payment. Corporations, by the intervention of their agents may be parties to a bill of exchange; but by stat. 3 and 4 W. 4. c. 98, under which the Bank of England enjoys exclusive privilege of banking, as a corporation, upon certain conditions, it is enacted by s. 2, that during the continuance of that privilege, no body politic or corporate, and no society or company, or persons united or to be united in covenants or partnerships, exceeding six persons, shall make or issue in London, or within sixty-five miles thereof, any bill of exchange or promissory note, or engagement for the payment of money on demand, or upon which any person holding the same may obtain payment on demand: provided that nothing therein, or in the 7 Geo. 4. c. 46, shall be construed to prevent any body politic or corporate, or any society or company, or incorporated company or corporation, or co-partnership, carrying on and transacting banking business at any greater distance than sixty-five miles from London, and not having any house of business or establishment as bankers in London, or within sixty-five miles thereof, (except as thereinafter mentioned,) to make and issue their bills and notes, payable on demand or otherwise, at the place at which the same shall be issued, being more than sixty-five miles from London, and also in London, and to have an agent in London, or at any other place at which such bills or notes shall be made payable for the purpose of payment only; but no such bill or note shall be for any sum less than five pounds, or be re-issued in London, or within sixty-five miles thereof. Assumpsit will lie on a bill of exchange against a trading corporation, whose power of drawing and accepting bills is recognised by statute. Infant.-An infant cannot bind himself by a bill drawn in the course of tradem, or even for necessaries". But infancy is a personal privilege, of which the infant alone can avail himself. Hence it has been holden, that the drawer of a bill of exchange cannot set up the infancy of the payee and indorser as a defence to the action. In like manner the acceptor of a bill of exchange cannot set up the infancy of the drawer as a defence to an action brought at the suit of the indorsee. Taylor v. Croker, 4 Esp. N. P. C. 187; and per Lord Hardwicke, in Haly v. Lane, 2 Atk. 181, 2. S. P. So, though a note given by a wife to a husband is void, yet if it is indorsed over by the husband, as between him and the indorsee, it is certainly good. Ibid. And if a bill be accepted by a party after he is of full age, he will be liable, although the bill was drawn on him while an infantp. Feme Covert.-A feme covert cannot bind herself by drawing a bill of exchange. This proposition falls within the general rule of law, which permits married women to avoid all contracts made by them during their coverture. To this rule there are some exceptions, which are stated under title Baron and Feme, sect. II. The interest in a bill of exchange or note given to a feme covert, vests in her husband, and he must indorse it. An action was brought by the indorsee against the maker of a promissory note. The first count of the declaration was upon the note, to which were added the money counts. It appeared that the note had been given by the defendant to a married woman, with knowledge of her coverture, to the intent that she should indorse it to the plaintiff, which was done accordingly, in payment of a debt which she owed him (in the course of carrying on trade in her own name with the consent of her husband.) The plaintiff had dealt with her as a feme sole. It was holden, that the property in the note vested in the husband by the delivery to the 1 Murray v. the East India Company, o Grey v. Cooper, B. R. E. 22 G. 3. 5 B. and A. 204. m Williams v. W. Harrison and R. Har rison, Carth. 160. MS. S. C. 3 Doug. 65. more fully reported p Stevens v. Jackson, 4 Campb. 164. n Williamson v. Watts, 1 Campb. 552. q Barlow v. Bishop, 1 East's R. 432. Sir J. Mansfield, C. J. |