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it is made penal to utter or publish any such; they being deemed prejudicial to trade and public credit. And, by 17 Geo. III. c. 30 (29), all such notes, bills, drafts, and undertakings, to the amount of twenty shillings, and less than five pounds, are subjected to many other regulations and formalities; the omission of any one of which vacates the security, and is penal to him that utters it.
The payee, we may observe, either of a bill of exchange or promissory note, has clearly a property vested in him (not indeed in possession but in action) by the express contract of the drawer in the case of a promissory note, and, in the case of a bill of exchange, by his implied contract, viz. that, provided the drawee does not pay the bill, the drawer will: for which reason it is usual, in bills of exchange, to express that the value thereof hath been received by the drawer (u); in order to shew the consideration, upon which the implied contract of repayment arises. And this property, so vested, may be transferred and assigned from the payee to any other man; contrary to the general rule of the common law, that no chose in action is assignable: which assignment is the life of paper credit. It may, therefore, be of some use, to mention a few of the principal incidents attending this transfer or assignment, in order to make it regular, and thereby to charge the drawer with the payment of the debt to other persons than those with whom he originally contracted.
In the first place then, the payee, or person to whom or whose order such bill of exchange or promissory note is payable, may, by indorsement, or writing his name in dorso, or on the back of it, assign over his whole property to the bearer, or else to another person by name, either of whom is (u) Stra. 1212.
The property in both bills and
notes is vested
in the payee.
As to the mode of assigning bills
(29) By the statute of 7 Geo. IV. under a penalty of 201, for every such ch. 6, the issuing of promissory notes note issued.
for any sum under 57. is prohibited,
then called the indorsee; and he may assign the same to another, and so on in infinitum. And a promissory note, payable to A. or bearer, is negotiable without any indorse
Acceptance of ment, and payment thereof may be demanded by any bear
[ *469 ]
er of it (v). But, in case of a bill of exchange, the payee, or the indorsee (whether it be a general or particular indorsement), is to go to the drawee, and offer his bill for acceptance; which acceptance (so as to charge the drawer with costs) must be in writing, under or on the back of the bill. If the drawee accepts the bill, either verbally (30) or in writing (w), he then makes himself liable to pay it; this being now a contract on his side, grounded on an acknowledgment that the drawer has effects in his hands, or at least Protest for non- credit sufficient to warrant the payment. If the drawee refuses to accept the bill, and it be of the value of 201. or upwards, and expressed to be for value received, the payee or indorsee may protest it for non-acceptance; which protest 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; and notice of such
(v) 2 Show. 235.-Grant v. Vaughan, T. 4 Geo. III. B. R.
(30) The statute of 1 & 2 Geo. IV. c. 78, enacts, that no acceptance of any inland bill shall be sufficient to charge any person, unless such acceptance be in writing on the bill, or on one of its parts when drawn in sets. But a parol acceptance of a foreign bill of exchange is still valid. (Fairlee v. Herring, 3 Bingh. 625). The same statute enacts, that acceptance of any bill of exchange, payable at a specified place, without further expression qualifying the acceptance, shall be deemed to all intents and purposes a general acceptance;
(therefore, in such case, the holder is not bound to present the bill at any particular time or place; Turner v. Hayden, 4 Barn. & Cress. 3); but if the acceptance express that the bill is accepted, payable at a specified place only, and not otherwise or elsewhere, such acceptance shall be deemed to all intents and purposes a qualified acceptance of the bill, and the acceptor shall not be liable to pay the said bill, except in default of payment, when such payment shall have been first duly demanded at the place specified.
protest must, within fourteen days after, be given to the drawer (31).
(31) The ground upon which the drawer of a bill of exchange is discharg ed from liability to the holder in respect thereof, if he has not received due notice of its dishonour, is, that the holder, omitting to send such notice to the drawer, must be presumed to have given credit to some person liable as between him and the drawer: and it has been held, (in Ex parte Barclay, 7 Ves. 598, in Staples v. Okines, 1 Esp. N. P. C. 333, and in Stewart v. Kennet, 2 Camp. 177), that notice of the dishonour of a bill should be given by the holder himself or his authorized agent, otherwise the drawer would be discharged: but in later cases, at law, it has been decided, that it is sufficient for an indorsee to prove that the drawer of a bill had notice of its dishonour from the acceptor, or any party to the bill: (Rosher v. Kiernan, 4 Camp. 87. Wilson v. Swabey, 1 Stark. 34): and likewise, that if the indorser of a bill receive notice of its dishonour from any person who is a party to the bill, he is directly liable upon it to a subsequent indorsee, although he had no notice of the dishonour from such subsequent indorsee. (Jameson v. Swinton, 2 Camp. 373). It seems, also, that want of notice to a drawer, of the dishonour of one of his bills of exchange, may be supplied by evidence of his acknowledgment to the holder, when asked if the bill would be paid, that "it would not:" (Brett v. Levett, 13 East, 214, and see infra): but such an acknowledgment, made by the drawer after he has committed an act of bankruptcy, is inadmissible as evidence, in an action by his assignees, to prove
the petitioning creditor's debt, in order to support the commission. (Smallcombe v. Bruges, 1 M'Clel. 60). And the necessity of notice is not dispensed with by any understanding which existed between the parties; for, evidence of such an understanding can never be admitted to vary the legal operation of an instrument: (Free v. Hawkins, 8 Taunt. 97): nor, will mere knowledge of the dishonour of a bill, (such knowledge not being derived from any par. ty to the bill, or person who would have a right of action thereon, if returned to him), be equivalent to notice from the holder, or other party thereto, for the purpose of fixing the person who has acquired such casual knowledge of the fact with responsibility, for, unless such notice be received, it may be supposed that the holder intends to give credit to some other party. (Esdaile v. Sowerby, 11 East, 116. Tindal v. Brown, 1 T. R. 169). Even when the drawer of a bill of exchange has become bankrupt, and absconded before it was due, and the acceptor also has become bankrupt before the bill was due; the holder will not be entitled to prove the bill under the commission against the drawer, unless notice of the dishonour of the bill has been duly given to the assignees of the said drawer; at all events when the bankrupt drawer's house was open, and a notice left there would have reached his assignees. (Rohde v. Proctor, 4 Barn. & Cress. 524). If, indeed, the bill had been dishonoured before assignees of the drawer's estate were chosen, notice to the drawer himself would be sufficient. (Ex parte Moline, 19 Ves. 217).
Protest for nonpayment.
But, in case such bill be accepted by the drawee, and after acceptance he fails or refuses to pay it within three days after it becomes duet (which three days are called days of grace), the payee or indorsee is then to get it protested for non-payment, in the same manner, and by the same persons who are to protest it in case of non-acceptance, and such protest must also be notified, within fourteen days after, to the drawer. And he, on producing such protest, either of non-acceptance, or non-payment, is bound to make good to the payee, or indorsee, not only the amount of the said bills (which he is bound to do within a reasonable
There are certain excepted cases, in which notice of the dishonour of a bill of exchange has been determined not to be necessary: for instance, (as was before intimated), where the drawer has no effects in the hands of the drawee, nor any right upon any other ground to expect the bill will be paid, he is held not to be entitled to formal notice of its dishonour; knowledge being, in such case substituted for notice: but the decisions establishing this and similar
exceptions have been frequently regretted by courts both of law and equity, as tending to introduce nice distinctions, instead of adhering to a plain and intelligible rule. (Cory v. Scott, 3 Barn. & Ald. 622. Claridge v. Dalton, 4 Mau. & Sel. 231. Wallwyn v. St. Quintin, 1 Bos. & Pull. 655. Mawson v. Stock, 6 Ves. 305. Ex parte Wilson, 11 Ves. 411. Ex parte Heath, 2 Ves. & Bea. 240).
† Mr. Christian observes, that "a bill or note is not now considered due or demandable till the last day of the three days grace; as, if a bill or note is dated on the 12th of any month, and made payable ten days, one week, or one month, after date, payment must be demanded on the 25th, the 22d, of the same, and on the 15th of the next month respectively. But, if the third day of grace falls on a Sunday, the bill or note is payable and due on the Saturday preceding; and by 39 & 40 Geo. III. c. 42, if payable on Good Friday, they are due the day before. Days of grace are allowed upon promissory notes, in like manner as upon bills of exchange.
(4 T. R. 148).
"A promissory note made payable to A., without adding or to his order, or to bearer, though not negotiable, is a note within the statute, and the three days of grace must be allowed upon it. (6 T. R. 123).
"A bill or note must be drawn upon a proper stamp, and if it be drawn upon a greater stamp than the statutes require, it cannot be received in evidence; but the plaintiff may recover as for so much money lent or advanced, if he can prove the defendant's promise to pay, or the consideration received by him from the plaintiff, independently of the imperfect note. (1 East, 55).”
protest, or to
the dishonour. give notice of
time after non-payment, without any protest, by the rules of the common law (x), but also interest and all charges, to be computed from the time of making such protest. But if Consequences of the neglect of no protest be made or notified to the drawer, and any the holder to damage accrues by such neglect, it shall fall on the holder of the bill. The bill, when refused, must be demanded of the drawer as soon as conveniently may be: for though, when one draws a bill of *exchange, he subjects himself to [*470 ] the payment, if the person on whom it is drawn refuses either to accept or pay, yet that is with this limitation, that if the bill be not paid, when due, the person to whom it is payable, shall in convenient time give the drawer notice thereof; for, otherwise, the law will imply it paid: since it would be prejudicial to commerce, if a bill might rise up to charge the drawer at any distance of time: when in the mean time all reckonings and accounts may be adjusted between the drawer and the drawee (y) (32).
If the bill be an indorsed bill, and the indorsee cannot get the drawee to discharge it, he may call upon either the drawer or the indorser, or if the bill has been negotiated through many hands, upon any of the indorsers; for each
(x) Lord Raym. 993.
(32) Notice of the non-acceptance of a bill must be sent or given to the parties to whom the holder means to resort within a reasonable time after the dishonour of the bill: but, it has been much disputed, whether it is the province of the court or of the jury to decide what is a reasonable time for this purpose: it seems, however, now to be understood that this is a question partly of fact and partly of law; and, that the jury are to find the facts, such as the distance from each other at which the parties live, the course of the post, &c.; but, when those facts are established, the reasonableness of the time becomes a question of law, and conse⚫
(y) Salk. 127.
quently is to be determined by the
& Sel. 70.
Each indorsee may, on default
of the acceptor,
or drawee, resort the prior in
to all or any of
dorsers for payment of the bill;