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bill, payable to order, is indorsed in blank by the payee ; for it may afterwards be transferred either by a new indorsement and delivery, or by simply delivering it to the intended transferee.
When the time arrives at which a bill is intended to be payable, it is said to be due (or at maturity); but this is not precisely the time expressed for payment on the face of it, the custom of merchants allowing for that purpose (unless it be drawn payable on demand (i)), three additional days, which are called days of grace; so that a bill becomes in reality due upon the third day of grace, and not earlier, unless it fall upon a Sunday, Christmas-day, Good Friday, or a day of public fast or thanksgiving (j),-in which cases the bill becomes due the day before. At any time before it becomes due, the person who possesses or is the holder of it, whether as payee or transferee—may present it (that is, carry and show it) to the drawee, for his acceptance. This it is in his option either to make or to refuse; and we will first suppose him to take the former course.
An acceptance (as to the manner of it) must be in writing on the instrument: it being enacted by 19 & 20 Vict. c. 97, s. 6, that no acceptance of any bill of exchange, whether inland or foreign, made after 31st Dec., 1856, shall be sufficient to bind or charge any person, unless the same be in writing on such bill; or if there be more than one part of such bill, on one of the said parts; and signed by the acceptor or some person duly authorized by him (h). The bill may also be either accepted simply, or accepted payable at a banker's; but the latter mode is merely for the convenience of the drawee, and in no respect qualifies his liability (1); the address at the banker's not having the effect of making the bill payable at the banker's only, unless restrictive words are added to that effect (m), -when the acceptance is said to be a special one, and binds the acceptor to payment at that place, but not elsewhere (n). After acceptance, any person who, as payee, or by transfer (whether before or after acceptance), may be the holder of the bill at its maturity, is entitled to immediate payment of the amount for which it is drawn, upon presenting it to the acceptor, (or at the place where he has made it payable (o),) for payment, and being ready to deliver it upon payment being made (p); and, if under such circumstances the money be not then paid, has a right to bring an action against the acceptor for the amount(9). But the holder is, in that case, also entitled to have recourse to the drawer, and to every person whose name was on the bill as indorser when it originally came to his hands; for each of these parties [is a warrantor for the payment of the bill,) and it is on the credit of their names (though also on that of the acceptor, where it was negotiated after acceptance), that he is supposed to have become the holder. The right of the holder, however, to have recourse to the drawer and indorsers, is subject to
(i) Chitty, Bills, 377, 9th edit. have been in writing, a foreign one If drawn payable at sight, the days might be accepted either in writing of grace are allowed, ibid.
or by parol. See 1 & 2 Geo. 4, c. 78, (j) 39 & 40 Geo. 3, c. 42; 7 & 8 s. 2; 9 Geo. 4, c. 24, s. 8; Mahoney Geo. 4, c. 15.
v. Ashton, 2 Barn. & Ald. 478. (k) Formerly, though the accept- (1) Turner v. Hayden, 4 Barn. & ance of an inland bill must always Cress. 1.
in any action on a bill or note commenced within six months after it has become due and payable, is not permitted to defend the action unless he obtains leave to do so from a judge ; and this (as the general rule) will orily be granted where he pays the money into court, or shows on affidavit that he has a legal or equitable defence, or facts which would make it incumbent on the holder to prove consideration (as to which term vide post, p. 122). As to points of practice under this statute, see Reg. Gen. M. T. 1855; Knight v. Pocock, 17 C. B. 177 ; Robinson r. Cotterell, 11 Exch. 476.
these conditions, first, that he shall have presented the bill to the drawee for payment, on the precise day when it became due; and next, that he give reasonable notice of its non-payment—that is, under ordinary circumstances, notice on the following day, or to persons not residing in the same town, notice by the post of that day, or in case of a foreign bill, by the next ordinary conveyance to all the parties whom he so intends to charge; or at least to him whose name was last placed on the bill, in order that the latter may give the like notice to the party next before him, and so in succession,- each party being allowed, in turn, a day for the purpose (r). An indorser, so called upon and obliged to pay, is, on the other hand, at liberty to have recourse to the drawer, or to any indorser prior to himself in order, provided such party shall have had due notice; and the same right attaches successively to each indorser, in his turn; but the original payee has of course no prior party to resort to but the drawer; and the drawer can resort to no party but the acceptor, on whom rests all the while the primary liability, and to
(r) As to points which have arisen in reference to notice of dishonour, either upon non-payment or non-acceptance, and particularly in respect of its sufficiency in point of time and form, see the following cases:– Williams v. Smith, 2 Barn. & Ald. 500 ; Chap. man v. Keane, 3 Ad. & El. 193; Terry v. Parker, 6 Ad. & El. 502; Grugeon v. Smith, ibid. 499; Furze v. Sharwood, 2 Q. B. 388; King v. Bickley, ibid. 419; Robson v. Curlewis, ibid. 421 ; Castrique ». Bernabo, 6 Q. B. 498 ; Bromage v. Vaughan, 9 Q. B. 608 ; East v. Smith, ibid. 292; Chard v. Fox, 14 Q. B. 200; Day v. Smith, 15 Q. B. 584; Burmester v. Barron, 17 Q. B. 828 ; Everard v. Watson, 1 Ell. & Bj. 801; Jennings v. Roberts, 4 Ell.
whom the drawer, or any other party compelled to take up the bill, is always entitled to look for satisfaction.
We will next suppose the drawee to refuse acceptance, a refusal that the law will imply, unless he accepts immediately on presentment, or within twenty-four hours after the bill is left with him for the purpose (s). By such refusal, the person who is holder at the time, becomes apprised that the bill is an ineffectual security, so far as the drawee is concerned ; and is therefore entitled to charge the other parties, viz., the drawer and indorsers, and even to charge them instanter, as liable to immediate payment (t), though the bill is not yet arrived at maturity. But to justify any recourse against these parties, notice of the nonacceptance must be given to them, according to the same law and course of proceeding that was before stated in reference to the case of non-payment; and such of them as are consequently obliged to take up the bill are entitled, as in that case, to their remedy over against all prior parties. The holder is besides at liberty, after giving notice of nonacceptance, to take his chance that the bill may, notwithstanding the refusal to accept, be ultimately paid by the drawee ; and may accordingly present it to him for that purpose when it comes to maturity, without thereby waiving his right to recourse against the other parties.
Another case still remains to be supposed, which is that of the bill being never presented for acceptance; for in general it is at the option of the holder whether he will make such presentment or not, the object of it being only to ascertain whether the bill is likely to be paid, and to strengthen its credit, if possible, by the additional security of the acceptor's name; though if a bill be drawn payable (as it often is) at a specified period after sight, or after demand, a presentment for acceptance is in that particular
(s) 1 Lord Raym. 281.
(t) Accordingly it is from this period that the Statute of Limita.
tions begins to run against the demand of the holder. Whitehead u. Walker, 9 Mee. & W. 506.
case indispensable, in order to give sight to the drawee, or to make demand upon him; and thereby to fix the time at which the bill is to become due (u). But the case of a bill never presented for acceptance will not require a separate discussion ; for, where that ceremony is omitted, the bill must at all events be presented for payment; and the same law of proceeding against the drawer and indorsers will then apply, as already stated in reference to the case where an accepted bill is presented for payment.
Independently of the notice of non-acceptance, and of non-payment, the holder is also entitled to have the bill of which either acceptance or payment is refused, protested ; and the protest (which is a formal declaration that the bill has been refused acceptance or payment, and that the holder intends to recover all the expenses, &c. to which he may be put in consequence thereof (x),) (must be made in writing under a copy of such bill of exchange, by some notary public; or if no such notary be resident in the place, then by any other substantial inhabitant in the presence of two credible witnesses.] In the case of a foreign bill, such protest is essential to the right of the holder to recover from the drawer or indorsers (y); and when made, due notice of dishonour having been also given, will entitle him to recover the amount of the bill, with interest, and all expenses, including the re-exchange (z), occasioned by returning it to the country where it was drawn. But upon an inland bill, the principal and interest may be recovered from these parties (due notice being given) without a protest (a); which is indeed a ceremony not usually observed with respect to bills of this description (6); though by