S. 51.

Noting or protest of bill.

66

international transactions a foreign bill must be protested," Byles on
Bills (13th Edition), 261. See also Story on Bills, sect. 277; Hoare
V. Cazenove, 16 East, at p. 398; Brough v. Parkings, 2 Ld. Raym. 993.
The protest should be made by a notary public, and when made by
such person, it must be signed by him; see sub-sect. 7 of his section;
but if there be no notary at the place where the bill is dishonoured,
it may be made by a householder or substantial resident of the place
in the presence of two witnesses; see sect. 94 of this Act and the
notes thereto. A protest is an instrument in writing signed by the
notary, and passed under his official seal; it must state correctly the
date of the dishonour and give a concise account of the refusal to
accept or pay, or other circumstances incident thereto; and it generally
(though this is not necessary) states at whose request the bill is pro-
tested;
but it is commonly stated in the protest to be done at the
request of the 'holders' or 'the bearer'; a protest in this country
does not require any attesting witness." Brooke's Notary (3rd
Edition), 75. “A notary is a public officer of the civil and canon law,
appointed by the Archbishop of Canterbury, who, in the instrument of
appointment decrees that full faith be given, as well in as out of
judgment, to the instrument by him to be made.'" Byles on Bills
(13th Edition), p. 262; 1 Parsons on Bills, 634. As to forms of protests
to be made when the services of a notary cannot be obtained, see the
first schedule to this Act. It may be added here that a foreign pro-
missory note need not be protested; sect. 89, sub-sect. 4.

(x) It was held in Rogers v. Stephens, 2 T. R. 713; Orr v. Maginnis, 7 East, at p. 360; Gale v. Walsh, 5 T. R. 239.

(w) See note (y) to this section.

(v) A second protest is gratuitous, De la Torre v. Barclay, 1 Stark at p. 8. It is not necessary to do so, because the holder by the nonacceptance acquires the most complete right of action against the drawer which the nature of the case admits, and no subsequent act or omission of the drawee can give him a more extensive right against the drawer than he has already acquired; see the judgment of Parke, B., in Whitehead v. Walker, 9 M. & W. 506.

(t) This is new; for though the noting of a bill has generally hitherto been done on the day of the dishonour, it has not been compulsory to do so, see Brooke's Notary (3rd Edition), 73.

(8) See sect. 93 of this Act and the notes thereto, which section follows the decision in Chaters v. Bell, 4 Esp. 48; and in Geralopulo V. Wieler, 10 C. B. 690, it was held, in the case of a foreign bill paid, supra protest for the honour of the indorser, that the formal protest may be drawn up or extended even after the commencement of an action by the person so paying; see 1 Parsons on Bills, 644.

(r) See Brooke's Notary (3rd Edition), p. 80; and Byles on Bills (13th Edition), 263.

(2) That is to say, at the place where the drawee resides, as was

the opinion of the Court of King's Bench in Mitchell v. Baring, 4 C. & P. 35. See 1 Parsons on Bills, 640.

(p) See note (8) hereto.

(0) This is almost the same as the provisions of 2 & 3 Will. 4 c. 98, which has been by this Act repealed; but there is this distinction between the two statutes, that the older one used the words "shall or may be protested."

(n) See Brooke's Notary (3rd Edition), p. 75; 1 Parsons on Bills, 645; see also note (y) hereto.

(m) This has been generally stated in a protest, see Brooke's Notary (3rd Edition), p. 75; see also note (y) hereto.

(7) See Brooke's Notary (3rd Edition), pp. 75, 76; see also note (y) hereto.

(k) This was decided in the old case of Debers v. Harriot, 1 Shower, p. 159; Story on Bills, sect. 279, note.

(j) As to the circumstances under which notice of dishonour may be dispensed with, see sub-sect. (2) of sect. 50 of this Act, and subdivisions (a), (b), (c) and (d) thereof, and notes (x), (w), (v), (t), (s), (r), (q), (p) and (o). This sub-section adopts the decision of the Court in Legge v. Thorpe, 12 East, 171.

(h) As to the circumstances under which delay in giving notice of dishonour is excused, see sub-sect. (1) of sect. 50, and notes (z), (y) and (x) thereto.

(g) As to reasonable diligence see sect. 36, sub-sect. (3), and note (v) thereto; sect. 39, sub-sect. (4), and note (e) thereto.

52.-(1.) When a bill is accepted generally present- Duties of ment for payment is not necessary in order to render the acceptor liable (a).

holder as regards drawee or acceptor.

(2.) When by the terms of a qualified acceptance Ind. Act, s. 93. presentment for payment is required, the acceptor, in the absence of an express stipulation to that effect, is not discharged by the omission to present the bill for payment on the day that it matures (b).

(3.) In order to render the acceptor of a bill liable it Ind. Act, s. 93. is not necessary to protest it, or that notice of dishonour

should be given to him (c).

(4.) Where the holder of a bill presents it for payment, Ind. Act, s. 81. he shall exhibit the bill to the person from whom he demands payment (d), and when a bill is paid the holder shall forthwith deliver it up to the party paying it (e).

(a) "Every bill is to be properly presented for payment; and in an action thereon against the drawer or indorser, a presentment according

to the custom and usage of merchants must be averred and proved; in an action thereon against the acceptor presentment (generally speaking) need not be averred or proved. This is clear, settled, undisputed law," per Bayley, J., in Rowe v. Young, 2 Bligh, H. L. at p. 468; again in Fayle v. Bird, 6 B. & C. 531, it was decided that presentment to the acceptor is not necessary, where the bill is accepted generally.

(b) So held in Smith v. Vertue, 9 C. B. N. S. 214; and so held in Rhodes v. Gent, 5 B. & Ald. 244, but the Court seemed to think with this qualification, that the acceptor has not sustained any actual loss through the delay in presenting the bill. It must be remembered that the acceptance in Rhodes v. Gent would now be a general acceptance; see sect. 19, sub.-s. 2 (C.) of this Act, and the notes thereto.

(c) It was so held in Treacher v. Hinton, 4 B. & Ald. 413. "The rule is, that the party, other than the acceptor, sought to be charged, is entitled to notice of dishonour," per Maule, J., in Rowe v. Tipper, 22 L. J. C. P. 185; nor is the maker of a promissory note entitled to notice of dishonour, Pearse v. Pemberthy, 3 Camp. 261.

(d) Presentment for payment means presentment according to mercantile usage; the document itself must be present though not the holder; per Blackburn, J., in Griffin v. Weatherley, L. R. 3 Q. B. 753. "The custom of merchants," says Lord Tenterden in Hansard v. Robinson, 9 D. & R. 860; 7 B. & C. 90; "is that the holder shall present the bill, at its maturity, demand payment of its amount, and upon receipt of the money deliver up the bill."

(e) See Brooke's Notary (3rd Edit.), p. 59. See also the judgment of Lord Tenterden, C.J., in Hansard v. Robinson, supra; also Alexander v. Strong, 9 M. & W. 733; and Crowe v. Clay, 9 Ex. 604; 23 L. J. Ex. 150. But it has been held that where a bill or note is not negotiable, the acceptor or maker cannot refuse to pay it on the ground that the payee has not got it in his possession or power, and cannot produce it for the purpose of delivering it up to the acceptor or maker on payment, Wain v. Bailey, 10 A. & E. 616; 2 P. & D. 507. But a banker receiving bills from his correspondents to whom they had been indorsed, to present for payment, is not guilty of negligence in giving up such bills to the acceptor upon receiving a cheque upon a banker for the amount, although it turn out that such cheque is dishonoured, Russell v. Hankey, 6 Term, 12. See also Vernon v. Bouverie, 2 Show..303.

LIABILITIES OF PARTIES.

53.-(1.) A bill, of itself, does not operate as an assignment of funds in the hands of the drawee available for the payment thereof (a), and the drawee of a bill who

S. 53.

does not accept as required by this Act is not liable on the instrument (b). This sub-section shall not extend to Funds in hand Scotland.

(2.) In Scotland, where the drawee of a bill has in his hands funds available for the payment thereof, the bill operates as an assignment of the sum for which it is drawn in favour of the holder, from the time when the bill is presented to the drawee (c).

(a) In Hopkinson v. Forster, L. R. 19 Eq. 74, it was held that a cheque is not an equitable assignment of the drawer's balance at his bankers. In this case the observations of Mr. Justice Byles in Keene v. Beard, 8 C. B. N. S. 381, that a cheque is an appropriation of so much money of the drawer's in the hands of the banker upon whom it is drawn for the purpose of discharging a debt or liability of the drawer to a third person were commented on, the late Master of the Rolls adding, "I am quite sure that learned Judge never meant to lay down that a banker who dishonours a cheque is liable to a suit in equity by the holder." The decision in Hopkinson v. Forster is in a great measure supported by that in Hill v. Royds, L. R. 8 Eq. 290. In that case the acceptor of a bill of exchange paid the amount to his bankers in order to meet the bill; on the day it arrived at maturity the acceptor died, and the bankers dishonoured the bill, which was returned to the drawers and subsequently paid by them. Upon bill filed by the drawers against the bankers to make good the amount, it was held that there was no privity between the plaintiffs and the defendants. Further, Hopkinson v. Forster, has been approved and followed in Schroeder v. The Central Bank of London, Lim., 34 L. T. N. S. 735. But though a cheque is not an assignment of funds belonging to the drawer in the hands of a banker, the banker, if he dishonour such cheque when he has such funds, is liable in damages to the drawer, per Jessel, M.R., in Hopkinson v. Forster, supra. A bill of exchange is still less than a cheque an assignment of funds in the hands of a drawee, for the latter is not bound to accept, and until acceptance he is not liable on the bill, as is provided in the latter part of this subsection; see notes (b) hereto and also section 2 of this Act and note (a) thereto, and sects. 17 and 54 of this Act and the notes thereto. See also note [(b) (4)] to sect. 73 of this Act. In America the law seems to be the same, see Parsons on Bills; as to bills, vol. i. pp. 331-336, and the cases cited therein; as to cheques, vol. ii. pp. 59-62, and the cases cited therein.

(b) But though not liable on the bill, he may be liable on an agreement to accept, Laing v. Barclay, 1 B. & C. 398; see also the judgment of Cockburn, L.C.J., in Godwin v. Robarts, L. R. 10 Ex. at p. 351.

of drawee.

SS, 53, 54,

Funds in hands of drawee.

Liability of acceptor.

Ind. Act, s. 32.

Ind. Act, s. 120.

Ind. Act, s. 121.

Ina. Act, s. 121.

(c) In a recent case in Scotland it was held that a cheque granted for value, and presented for payment, operates as an intimated assignation of any funds of the drawer in the hands of the bank up to the amount of the cheque, British Linen Co. Bank v. Carruthers, Court of Sess. Cas. 4th series, vol. x. 923. Referring to the present and 73rd sections of this Act, Lord Shand in his judgment says: "The result of these sections is that a cheque to a third party has the force of a bill; and 2nd, that the statute enacts the common law of Scotland, that a cheque or a bill of exchange, when intimated, is effectual as an intimated assignation. . . . That being so, the only question remaining is whether, because the bank was in debt to the grantor to a less amount than that contained in the cheque, the assignation is useless? If this had been an ordinary assignation of a fund and not a cheque, that circumstance would not have prevented the intimated assignation from carrying the amount in the debtor's hands, and the circumstance that this is in form a cheque can make no difference."

54. The acceptor of a bill, by accepting it

(1.) Engages that he will pay it according to the tenor of his acceptance (z):

(2.) Is precluded from denying to a holder in due

course:

(a) The existence of the drawer, the genuineness of his signature, and his capacity and authority to draw the bill (y);

(b) In the case of a bill payable to drawer's order, the then capacity of the drawer to indorse (x), but not the genuineness or validity of his indorsement (w);

(c) In the case of a bill payable to the order of a third person, the existence of the payee and his then capacity to indorse (v), but not the genuineness or validity of his indorsement (†).

(z) The acceptance of a bill, like the making a note, has always been considered to be an absolute undertaking, on the part of the acceptor or maker, to pay the payee, or order or bearer, in the manner directed by the instrument; see Walton v. Mascall, 13 M. & W. at pp. 457, 458; see also the judgment of Byles, J., in Smith v. Vertue, 9 C. B. N. S. 214; 30 L. J. C. P. 56. Story on Bills, s. 113.

(y) So held hitherto; as to the signature of the drawer, per Lord Ellenborough, C.J., in Bass v. Clive, 4 M. & S. 13; per Lord Tenterden, C.J., in Cooper v. Meyer, 10 B. & C. 468; see also Sanderson v.