Signature NOTE. This is one of the exceptions to the general rule, that a of corpora corporation can only bind itself by an instrument under seal: Grant on Corp., p. 61. The usual form of signature for a corporation is a procuration signature. Cf. Art. 278. Note under Seal. tion or company. Liqui dators. Explanation.-A company, under the Companies Acts, 1862 and 1867 (having the requisite capacity),1 is deemed to have made, accepted, or indorsed a bill which is either (a) "Made, accepted, or indorsed in the name of the company;" or (b) "Made, accepted, or indorsed by, or on behalf, or on account of the company,' "by any person acting under the authority of the This is the note of the company and not of the directors personally." NOTE. Cf. Art. 37, Expl. 3, and Art. 77, for further illustrations. Compare the language of the present Act, 25 & 26 Vict. c. 89, § 47, quoted above, with the previous Companies Act, 19 & 20 Vict. c. 47, § 43. Clause () is new. In order to determine whether a company or other corporation is liable on a bill, three questions must be asked: 1. Has the company the requisite capacity to bind itself by a bill? 2. Is the signature on the bill sufficient in form to bind the company? 3. Was the signature placed there by a person having authority to sign bills for the company? It is immaterial that a person who acts within the scope of his authority in signing bills exceeds or contravenes private instructions. See also Art. 75, and note. Art. 51. When a company, under the Companies 1 Art. 67; and Bolognesi's case (1870), 5 L. R. Ch. Ap. 567. 2 25 & 26 Vict. c. 89, § 47; Cf. Re Land Credit Co. (1869), 4 L. R. Ch. Ap. 460. 3 Lindus v. Melrose (1858), 3 H. & N. 177, Ex. Ch.; approved, Dutton v. Marsh (1871), 6 L. R. Q. B. 361. 4 Re Land Credit Co., ante. As to the powers of de facto directors, Cf. Mahony v. East Holyford Co. (1875), 7 L. R. H. of L. 869. dators. Acts, is in liquidation, and two or more liquidators Liquiare appointed, a bill must be signed by at least two liquidators in order to bind the company.1 tional Art. 52. When a person is induced by fraud to Unintensign a bill under the belief that he is signing a signature. wholly different instrument, his signature is null and void, provided that in so signing he acted without negligence.2 ILLUSTRATIONS. 1. D., an old man with enfeebled sight, is induced to sign his name on the back of a bill, by being told that it is a railway guarantee which he had promised to sign. The bill is negotiated to a bona fide holder. D. is not liable as an indorser.3 2. B. is induced, by fraud, to sign a negotiable note as maker, believing it to be a non-negotiable note for a less sum. It is negotiated to a bonâ fide holder. Negligence is negatived. B. (probably) is not liable.a NOTE.-Frauds of this sort are more common in America, owing to the absence of stamp laws. A man's signature is obtained for some pretended purpose, and then a promissory note is over-written. Delivery. necessary. Art. 53. Delivery is the necessary complement of Delivery every contract on a bill, be it drawing, making, acceptance, or indorsement; and until delivery be made the contract is inchoate and revocable." Explanation.-Delivery means transfer of possession, actual or constructive, from the obligor to the obligee. ILLUSTRATIONS. 1. B., who is indebted to C., makes a note for the amount pay 1 Ex parte Agra Bank (1871), 6 L. R. Ch. 206. 2 Foster v. Mackinnon (1869), 4 L. R. C. P. 704; Briggs v. Ewart (1873), 11 Amer. R. 445. 3 Id.; Cf. Société Générale v. Met. Bank (1873), 27 L. T. N. S. 849. Griffiths v. Kellog (1876), 20 Amer. R. 48. 5 Cf. Abrey v. Crux (1869), 5 L. R. C. P. at 42. necessary. Delivery able to C. B. dies, and the note is afterwards found among his papers. C. has no right to this note, and if it be given to him he cannot enforce it.' 2. B. makes a note in favour of C., and delivers it to a stakeholder (e.g., trustee under composition deed). C. thereby acquires no property in the note. 3. C., the holder of a bill, specially indorses it to D.; C. transmits it by post to X., his own agent. X. informs D. that he has received the bill, but does not give it him or undertake to hold it on his account. C. can revoke the transaction and cancel his in dorsement to D.3 4. C., the holder of a bill, specially indorses it to D., and incloses it in a letter addressed to D. The letter, which is put in the office letter-box, is stolen by a clerk of C.'s, who forges D.'s indorsement and negotiates the bill. The property in the bill remains in C.4 5. By the regulations of the English Post-office, a letter once posted cannot be reclaimed. If, then, the indorser of a bill authorize the indorser to transmit it to him by post, the property in the bill passes to the indorsee, and the indorsement becomes complete as soon as the letter which contains the bill is posted. 6. C., the holder of a note payable to bearer, wishes to remit money to D. For safety of transmission he cuts the note in half and posts one half to D. Before he posts the second half he changes his mind, and writes to D. demanding back the half he has sent. He is entitled to do so, for a partial delivery is ineffectual. 6 7. A bill is left with the drawee for acceptance. The drawee writes an acceptance on it. The next day the holder calls for the bill he is merely informed that it is mislaid, and is requested to call the next day. In the meantime the drawee hears that the drawer has failed. He accordingly cancels his acceptance, and the 1 Cf. Bromage v. Lloyd (1847), 1 Exch. 32. 2 Cf. Latter v. White (1872), 5 L. R. H. of L. 578. 3 Brind v. Hampshire (1836), 1 M. & W. 365; Muller v. Pondir (1873), 55 New York R. 325. 4 Cf. Arnold v. Cheque Bank (1876), 1 L. R. C. P. D. at 584. 956. Ex parte Cote (1873), 9 L. R. Ch. 27; Sichel v. Birch (1864), 2 H. & C. Smith v. Mundy (1860), 29 L. J. Q. B. 172; Cf. Redmayne v. Burton (1860), 2 L. T. N. S. 324. next day delivers the dishonoured bill back to the holder. This is Delivery no acceptance; the drawee was entitled to cancel it.1 8. C. & Co. are indebted to D. X., who is a partner in C. & Co., and also agent for D., writes C. & Co.'s indorsement on a bill held by the firm, and puts the bill with some other papers of D., of which he has the custody. This is a valid indorsement by C. & Co., and the property in the bill passes to D.2 NOTE.-In Illustration 8 delivery is effected by transfer of the constructive possession, i.e., the actual possession remains unaltered, but it is continued in a different right. A person has the constructive possession of a thing when it is in the actual possession of his servant or agent on his behalf; therefore delivery may be effected without change of actual possession, in three cases: 1. A bill is held by C. on his own account: he subsequently holds it as agent for D. 2. A bill is held by C.'s agent, who subsequently attorns to D., and holds it as his agent. 3. A bill is held by D. as agent for C.; he subsequently holds it on his own account.3 There is this difference between an acceptance and the other contracts on a bill. The drawee has no property in the bill, therefore an attornment to the holder will be presumed on slight evidence, perhaps the mere intimation by the drawee of the fact that the acceptance has been written.4 necessary. by whom. Art. 54. As between immediate parties (Art. 88), Delivery, delivery in order to be effectual must be made by the obligor or his agent. ILLUSTRATIONS. 1. C., the holder of a bill, specially indorses it to D. He dies before delivering it, but his executor subsequently hands the bill to D. The indorsement to D. is invalid, for an executor is not the agent of his testator. D. cannot sue on the bill." 2. X., by means of a false pretence, or a promise or condition which he does not fulfil, procures A. to draw a cheque in favour of C. X. delivers it to C., who receives it bona fide and for value. 1 Bank of Van Dieman's Land v. Victoria Bank (1871), 3 L. R. P. C. 526. 2 Lysaght v. Bryant (1850), 9 C. B. 46. 3 Cf. in illustration Field v. Carr (1828), 2 M. & P. 46; Bosanquet v. Forster (1841), 9 C. & P. 659; Belcher v. Campbell (1845), 8 Q. B. 1. Cf. also Ancona v. Marks (1862), 31 L. J. Ex. 163, ratification of delivery; Ex parte Cote (1873), 9 L. R. Ch. 27, delivery by mistake and revocation by consent. 4 Cf. Cox v. Troy (1822), 5 B. & Ald. 474; approved Chapman v. Cottrell (1865), 3 H. & C. 857; Art. 32 n., Foreign Laws. Bromage v. Lloyd (1847), 1 Exch. 32. Delivery, C. acquires a good title, and can sue A., for X. is ostensibly A.'s by whom. Condi tional delivery. agent.1 3. A. draws a cheque payable to bearer, intending to pay it to X. It is stolen from his desk before he issues it, and is subsequently negotiated to C., who takes it for value and without notice. C. acquires a good title and can sue A.* Art. 55. As between immediate parties (Art. 88), a bill may be shown to have been delivered conditionally, or for a special purpose only, and not for the purpose of transferring the entire property therein.3 ILLUSTRATIONS. 1. B. makes a note payable to C., who sues him on it. B. can defend himself by showing that the note was delivered to C. on condition that it was only to operate if he should procure B. to be restored to a certain office, and that B. was not so restored.* 2. C., the holder of a bill, indorses it in blank and hands it to D. on the express condition that he shall forthwith retire certain other bills therewith. He does not do so. D. cannot sue C., and if he sue the acceptor, the latter may set up the jus tertii. 3. C., the holder of a bill, indorses it specially to D. in order that he may get it discounted for him. D., in breach of trust, negotiates the bill to E. If E. take the bill bonâ fide and for value, he acquires a good title, and can sue all the parties thereto. If he do not so take it, he cannot sue C.; and if he sue the acceptor, the latter may set up that the bill is C.'s; further, C. can bring an action against E. to recover the bill or the proceeds.7 4. C., the payee of a bill, indorses it to D. D. sues C. as indorser. C. may show that he and D. were jointly interested in the bill, and that he indorsed to the latter to collect on joint account. 6 1 Cf. Watson v. Russel (1862), 3 B. & S. 34; affirmed 5 B. & S. 968, Ex. Ch. 2 Ingham v. Primrose (1859), 7 C. B. N. S. at 85; Kinyon v. Wohlford (1872), 10 Amer. R. 165. 3 Cf. Druiff v. Parker (1868), 5 L. R. Eq. at 137; Salmon v. Webb (1852), 3 H. L. Ca. at 518; Benton v. Martin (1873), 52 New York at 574. 4 Jefferies v. Austin (1725), 1 Stra. 674. 5 Bell v. Lord Ingestre (1848), 12 Q. B. 317; Cf. Seligman v. Huth (1877), 37 L. T. 488. 6 Lloyd v. Howard (1850), 15 Q. B. 995; and Cf. Barber v. Richards (1851), 6 Exch. 63. 7 Goggerly v. Cuthbert (1806), 2 N. R. 170; Cf. Alsager v. Close (1842), 10 M. & W. 576; Mutty Loll v. Dent (1853), 8 Moore. P. C. 319. 8 Denton v. Peters (1870), 5 L. R. Q. B. 475. |