(d) As regards the indorser, in the following cases, namely:

(1) Where the drawee is a fictitious person or a person not having capacity to contract, and the indorser was aware of the fact at the time he indorsed the bill; 6

(2) Where the indorser is the person to whom the bill is presented for payment;

(3) Where the bill was accepted or made for his accommodation. 7

1 Where the drawer has sustained, and can sustain no loss or injury or prejudice by the want of notice of dishonor, he will be held liable, notwithstanding the want of such notice, if having funds in the hands of the drawee, he voluntarily withdraws them, or if having no funds in the hands of the drawee, but having them on the way to reach him, and to be applied to the discharge of the bill, he intercepts and stops them, or where before acceptance he orders the drawee not to accept the bill: Story on Bills, s. 313. Delay in the presentment of a bill for acceptance is excused, for causes mentioned in s. 41, sub-s. 2; delay in presentment for payment is excused for the causes mentioned in s. 46; and this section prescribes what are excuses for delay in giving notice of dishonor; and they also apply to delay in giving notice of protest by s. 51, sub-s. 9.

ILLUSTRATIONS.

There must be reasonable diligence, such as men of business usually exercise when their interests depend upon obtaining correct information: Palmer v. Whitney, 21 Ind. 58; s.p., New Orleans Canal Co. v. Bry, 2 La. An. 303.

As the law-merchant respects the religion of different people, a Hebrew indorsee was held not guilty of laches, who neglected to give notice on the regular day, that day being a festival whereon he was forbidden to attend to secular business: Lindo v. Unsworth, 2 Camp. 602.

A state of war between the country of the drawer and that of the drawee, is an excuse for delay in giving notice: Hopkirk v. Page, 2 Brock 20.

The prevalence of an epidemic (as yellow fever) in a locality, is an excuse for delaying to give notice of dishonor: Tunno v. Lague, 2 Johns. (N. Y.) 1.

Sickness, to be an excuse for delay in presenting and giving notice, must be shown to have been not only sudden, but likewise so severe as to have prevented the holder or agent from employing another to make the presentment, and then it must be shown that the proper steps were taken as soon as the disability was removed: Wilson v. Senier, 14 Wis. 386.

The question of diligence in giving notice of dishonor to the indorser, is a mixed question of law and fact: Nash v. Harrington, 1 Aik. (Vt.) 39.

Sec. 50.

As regards indorser.

Sec. 50.

The seasonableness of the notice of dishonor, so far as it effects the question of due diligence, is a question of fact for a jury: Robertson v. Vogle, 1 Dall. 253.

Where, by the law-merchant, the drawer of a bill is not entitled to notice of dishonor, the statutory diligence need not be observed: Wood v. McMeans, 23 Tex. 481.

Where the indorser resides in a different place from that in which it is payable, notice of dishonor must be sent to him in the place in which he is actually a resident: Bank of Utica v. DeMott, 23 Johns. (N. Y.) 432.

A note was presented for payment in D., and dishonored and protested. Notices of dishonor were posted to the indorser, addressed to Ĉ., but he lived in D., and the bank which held the note for collection, could have seen the mistake, in due time, from the protest which it received. The indorser was held to be released; but the bank was held liable because it neglected to rectify the mistake, and send a proper notice to the indorser: Steinhoff v. Merchants Bank, 46 U. C. Q B. 25.

2 The death, known bankruptcy, or known insolvency, of the drawee, or acceptor of a bill or maker of a note, or his being in prison, or the notorious stopping payment of a banker, constitutes no excuse, either in law or in equity, or in bankruptcy, for the neglect to give due notice of nonacceptance, or non-payment; because many means may remain of obtaining payment by the assistance of friends or otherwise, of which it is reasonable that the drawer and indorsers should have the opportunity of availing themselves, and it is not competent to the holder to show, that the delay in giving notice has not, in fact, been prejudicial. It has been observed that it sounds harsh that the known bankruptcy of the acceptor should not be deemed equivalent to a demand, or notice, but the rule is too strong to be dispensed with, and the holder of a bill has no right to judge what may be the remedies over, of a party liable on a bill. It is no excuse that the chance of obtaining any thing upon the remedy over, was hopeless; that the person or persons against whom the remedy would apply, were insolvents or bankrupts, or had absconded. Parties are entitled to have the chance offered to them; and if they are abridged of it, the law, which is founded on the custom of merchants, says they are discharged: Chitty on Bills, 482. Delay in presentment for payment is not excused in all the cases where delay is excused in giving notice of dishonor; but only in the following cases mentioned in sub-s. 2: (a) "reasonable diligence; (b)" waiver ; " (c 2) (d 1) “a fictitious person, or a person not having capacity to contract," (the latter person is not mentioned in s. 46); (c. 4) drawee “under no obligation to accept or pay ;" and (d 3) accom-modation of that indorser." See further note 1 to s. 46.

ILLUSTRATIONS.

66

When notice of dishonor reaches the drawer of a bill too late, having first, by mistake, been sent to a wrong person, and such mistake arose from the indistinctness of the drawer's writing on the bill, he is not discharged: Hewitt v. Thompson, 1 M. & Rob. 541.

It is the duty of the holder to give the notary full information as to the names and residences of the indorsers. Where the signature of an

indorser was so peculiar that it could not be deciphered, although the Sec. 50. holder of the note was well acquainted with the signature, and of the party's residence, but omitted to communicate them to the notary, who when protesting the note made, or as near as might be, a fac simile of the signature, and so addressed the notice of dishonor to "Belleville P. O." but the indorser swore that the notice never reached him, though resident in Belleville ;-Held, that the indorser was discharged: Baillie v. Dickson, 7 App. R. 759; s. c., 46 U. C. Q. B. 167.

The bank held a note made by A. and indorsed by B. for the accommodation of D., who discounted it with the bank, which had knowledge of the accommodation. On the note being dishonored, the bank handed it to D. who was the bank's solicitor for protest. D. did not protest or notify A. or B. of its dishonor, but delivered it to them, adding that he had paid it. After its maturity, D. became insolvent and absconded, and A. and B. were for the first time notified of the non-payment of the note; -Held, on equitable grounds, that by the laches of the bank's agent they were discharged: Canadian Bank of Commerce v. Green, 45 U. C. Q. B. 81.

A bill drawn on persons residing in Dublin, Ireland, was protested for non-payment on the 3rd November, 1841; notice thereof was received by the indorsers, who resided at St. John, N. B., (where the bill was drawn), on the 22nd December following, but was held not to be in due time, it appearing that the mails left Great Britain for New Brunswick, on the 4th and on the 19th November, and that a notice sent by the mail of the 19th, would have reached St. John about the 4th December: Bank of New Brunswick v. Knowles, 2 Kerr N. R. 219. But see Tarratt v. Wilmot, 1 All. N. B. 353.

The holder of an overdue bill went during business hours to the counting-house of the drawer, for the purpose of giving notice of dishonor, and, finding the counting-house shut, he knocked at the door, and no one answering, he came away, without leaving any notice ;-Held, that these facts did not support an allegation of due notice, but were equivalent to a dispensation with notice: Allen v. Edmundson, 2 Ex. 719. See also Crosse v. Smith, 1 M. & S. 545.

Ignorance of the place of residence of the drawer is a sufficient excuse of the want of notice of dishonor, provided due diligence is used to discover his place of residence: Browning v. Kinnear, Gow. 81; and see Williams v. Germaine, 7 B. & C. 469; Bateman v. Joseph, 12 East 433, and Beveridge v. Burgis, 3 Camp. 262.

The time consumed in making necessary inquires relative to the parties to a note, is not to be imputed as laches. Thus, where the plaintiff became acquainted with the dishonor on the 5th, and not knowing the parties, notice was not despatched to them until the 16th, the original indorser was still held liable: Baldwin v. Richardson, 2 D. & R. 285; 1 B. & C. 245.

A notice, though carelessly mailed by the notary on the day of protest to a wrong address, had been received by the defendant about a week afterwards, and there was some slight proof of his having applied to the plaintiff for further time for payment. The jury found for the plaintiff against the Judge's charge, and the Court refused to interfere : Leith v. Neill, 19 U. C. Q. B. 233. See Commercial Bank v. Weller, 5 U. C. Q. B. 433; Reed v. Mercer, 16 U. C. C. P. 279, and Bank of Montreal v. Scott, 24 U. C. Q. B. 115.

.

The indorser of a bill which had been dishonored, after a subsequent indorsee had made it his own by laches, paid the bill, and gave notice of

Sec. 50. dishonor to a prior indorser ;- Held, that he could not recover, ever though the defendant, in case of successive notices by the other parties on the bill, could not have received notice sooner: Turner v. Leech, 4 B. & A. 451.

3 The waiver may be in the nature of admissions of liability, which are held to be evidence of due notice having been given; or admissions of liability where no notice has been given, and which are held to be evidence of waiver of notice; or admissions at the time the bill is due, such as that it will not be paid, and that notice need not be given. See the cases in note 6 on waiver, s. 46.

ILLUSTRATIONS.

The duty of demand of payment and notice of dishonor, in order to hold an indorser, is not part of the contract, but a step in the legal remedy that may be waived at any time: Barclay v. Weaver, 19 Pa. 396.

Where ignorance of residence arises from the drawer, a few days before the bill was due, stating to the holder that he had no regular place of abode, and that he would call and see if the bill were paid, he is not entitled to notice: Phipson v. Kneller, 4 Camp. 285.

A person who has given a written guarantee of a note, is not entitled to notice of dishonor: Palmer v. Baker, 23 U. C. C. P. 302.

Nor is one who gives a guarantee for goods to be supplied to the acceptor of a bill: Holbrow v. Wilkins, 1 B. & C. 10.

A conditional promise by an indorser to pay in land, or see that the holder should lose nothing, made before or after action, waives any objection as to notice: Burke v. Elliott, 15 U. C. Q. R. 610. See also McCuniffe v. Allen, 6 U. C. Q. B. 377.

Asking for time and promising to pay, is a waiver of notice: Bank of Upper Canada v. Cooley, 4 U. C. O S. 17.

Where there has been a subsequent unconditional promise to pay, with a knowledge of a default on the part of the holder, notice is dispensed with Bank of British North America v. Ross, 1 U. C. Q. B. 199.

The drawer of a bill informed the holder on the presentation of a bill before the days of grace had run, that the bill would not be paid ;-Held, further demand and notice were unnecessary: Minturn v. Fisher, 7 Cal. 573.

An indorser promising to pay, though aware that no notice had been given, is a waiver: Shaw v. Salmon, 19 U. C. Q. B. 512. See also McMurrich v. Powers, 10 U. C. Q. B. 481.

Where an indorser writes to the holder to make him believe it unnecessary to give him notice of non-payment, and stating that the maker is insolvent, it may be construed as dispensing with notice: Beckett v. Cornish, 4 U. C. Q. B. 138.

For obvious reasons it would seem to be scarcely necessary to enact this clause. The drawee, in drawing the bill in the name of a “fictitious person," becomes a party to a fraud, and is entitled to no protection from the law. So in the case of a person having no capacity to contract, the drawer acquires no security for his claim, should the drawee become an acceptor; while he becomes, practically, the primary debtor to the holder. See as to the names of fictitious or non-existing persons to bills, the notes to ss. 5, 7, 24 and 41.

This is based upon the proposition that a party who cannot be pre- Sec. 50. judiced by want of notice of dishonor, shall not be entitled to receive it. Thus if the drawer knows that he has no effects in the acceptor's hands to answer the bill, he cannot be injured for want of notice: 2 Smith's Leading Cases, 50.

ILLUSTRATIONS.

Nothing will dispense with the necessity of notice, but the circumstance of there being no effects of the drawer in the drawee's hands; it is not enough to show that the drawer has not been damnified: Dennis v. Morrice, 3 Esp. 158,

If the drawer has no effects in the hands of the drawee, and no reasonable grounds to expect that the bill will be honored, he is not entitled to notice: Legge v. Thorpe, 12 East 171. But see Wilkes v. Jacks, Peake

202.

The want of effects which will excuse notice of dishonor need not be a want of any effects; it is sufficient if there are no sufficient effects: Carew v. Duckworth, L. R. 4 Ex. 313.

Bankruptcy of the acceptor does not dispense with notice to the drawer: Boultbee v. Stubbs, 18 Ves. 21.

6 The rule requiring notice on the dishonor of a bill or note is only applicable to the case of a fair transaction, where the bill or note has been given for value, and in the ordinary course of trade: De Berdt v. Atkinson, 2 H. Bl. 336. Notice of dishonor is dispensed with by this clause, where the "drawee" is a fictitious person, or a person not having capacity to contract, and the name was used to the knowledge of the indorser. But it has been held that a person who, without consideration, and without fraud, indorses a bill, on which both the drawer and acceptor are fictitious persons, is entitled to notice of dishonor: Leach v. Hewitt, 4 Taunt. 731. 'It is a party's own fault if he has indorsed a bill of [fictitious] persons who cannot answer over to him, and he must be a sufferer thereby; he has placed himself in the common situation of an indorser:" Per Lord Mansfield, C. J., Ibid, 732. But if for example A. draws on himself, payable to himself, and then accepts, and then indorses, a holder need not first demand of him as drawee, and then notify him of non-payment as drawer, and then notify him again as indorser: 1 Parsons on Bills, 521. See also Caunt v. Thompson, 7 C. B. 400, and New York Contracting Co. v. Selina Savings Bank, 23 Amer. R. 552.

7 The same strict and technical notice of dishonor is not requisite to charge a person liable on the consideration, as is requisite to charge a person liable on the bill. In the one case the liability is transferable, in the other it is not; and therefore all the defences between the parties can be inquired into Chalmers on Bills, 159. A bill drawn, payable at the house of the drawer, must be presumed to be an accommodation bill, and the drawer is not entitled to notice of its dishonor: Sharp v. Bailey, 9 B. & C. 44. See also Turner v. Samson, 2 Q. B. D. 23, and the notes to s. 28.