unless the payment was made with this intention. The rules governing the rights of bona fide holders for value do not generally apply in the case of discharge by operation of law.

CHAPTER IX.

CHECKS.

SECTION 51. DEFINITION.

"A check is a draft or order on a bank or banker, purporting to be drawn on a deposit of funds, for the payment, at all events, of a certain sum of money to a certain person therein named, or to him or his order, or to bearer, and payable instantly on demand."1

SECTION 52. NEGOTIABILITY.

A check is not strictly a bill of exchange,' but closely resembles an inland bill of exchange, payable on demand. It is governed by the same rules in relation to transfer, indorsement and negotiability. To be negotiable, however, a check must be in the form of a negotiable instrument; a check payable on a contingency is not negotiable.

SECTION 53. LIABILITY OF BANKS.

A check gives the payee no rights against the bank upon which it is drawn. The bank is under no liability to the payee for refusing to pay the check, even when the bank holds funds of the maker. In such a case the payee has a right of action against the

1 Norton on Bills and Notes, Sec.

148.

"In a sense, undoubtedly, a check is a species of bill of exchange, and in a sense, also, it is a distinct commercial instrument; but according to the understanding of merchants, and according to our statutes, these instruments were checks and not bills of exchange. 'A check is an order to pay the

holder a sum of money at the bank, on the presentment of the check and demand of the money. No previous notice is necessary; no acceptance is required or expected; it has no days of grace. It is payable on presentment, and not before.' Norton on Bills and Notes, page 384, note. Keene vs. Bland, 8 C. B. (N. 8.), 380.

maker, and the maker a right of action against the bank.

"By certifying a check to be good, the bank assumes an unconditional obligation to the holder presenting it, and to every subsequent holder, to pay it on demand; and this obligation may be enforced by the holder against the bank. And a delay in presentment will not discharge the obligation.

"The certification of a check at the instance of the holder discharges the drawer and indorsers from liability, but the drawer is not discharged where he himself has it certified, and puts it in circulation. The drawer will also be discharged if the holder takes the parol acceptance of the bank instead of payment."

SECTION 54. PRESENTMENT, PROTEST AND NOTICE AS TO CHECKS.

In general, the rules in force as to presentment, notice and protest of checks are the same as in the case of bills of exchange and promissory notes. But there is in this connection, this distinction between a check and a bill of exchange: the want of due presentment or notice of dishonor of a check does not discharge the drawer unless he has suffered some loss or injury thereby. It may be said further, that a holder of a check cannot by his mere act of delay lose his right of recourse on the drawer; still it is his duty to present the check for payment within a reasonable time and give notice to the drawer within a like reasonable length of time if it is dishonored, and if he fails to do so, the delay is at his peril.'

• Norton on Bills and Notes, Secs. 156-157.

• Merchants Bank vs. State, 10 Wall., 496.

• Heartt vs. Rhodes, 66 III., 357.

' Stevens vs. Park, 73 Ill., 387.

The holder by his omission to make presentment, protest and notice assumes the burden of showing that the failure to obtain payment of the check was through no fault of his, and necessarily that no damage had occurred to the drawer by his delay.

In case the bank on which the check is drawn fails, after the check has been delivered to the holder, and after he has held it and has not presented it within a reasonable length of time, if the drawer of the check had sufficient funds in bank to meet the check, the fault of failing to obtain payment is on the holder of the check. But if the bank has not failed the drawer cannot claim a discharge because the holder has merely delayed presenting the check to the bank for payment.

As to the question, as to what constitutes a reasonable length of time, that the holder may take to make presentment of a check, or to pass it by transfer to another, so that the peril of the failure of the bank on which the check is drawn shall not be assumed by the holder, the law has declared that time to be only twenty-four hours after the holder has received the check. The holding of the check, therefore, for more than one day, it has repeatedly been held, discharges the drawer, in case the bank on which the check is drawn fails in the meantime.1

10

But the rule as stated will not be permitted to work too great a hardship on the holder, and a further interpretation of the rule gives the holder of a check who receives it at a point more or less remote from the bank on which it is drawn the whole of the day follow10 Bickford vs. First National Bank,

• Moyt vs. Seeley, 18 Conn., 353; Daniels vs. Kyle, 1 Ga., 304. • Mohawk Bank vs. Broderick, 10 Wend., 309.

42 Ill., 238.