1. Deviate from the usual course in order to protect the ship and cargo from imminent peril.

2. Tranship the goods into another vessel where he is prevented through excepted perils from completing the voyage.

3. Throw overboard a part of the cargo in case of necessity.

4. Make a salvage agreement on behalf of the ship.

As agent of the cargo-owner the master may— 1. Sell damaged goods where this is the wisest course, provided he cannot communicate with the cargo

owner.

2. Borrow money on the security of the cargo in case of necessity.

3. Make a salvage agreement on behalf of the cargo. § 236. Authorities.-Charter-parties and Bills of Lading, by T. E. Scrutton, contains a concise digest of the law. The standard treatises on shipping by Mr. Abbott and Mr. Maclaghlan discuss the subject in detail. A shorter account will be found in Smith's Mercantile Law.

CHAPTER VII

BILLS, NOTES, CHEQUES, AND I.O.U.S

§ 237. Mercantile Instruments.-The greater portion of mercantile transactions are carried out by means of credit. Whenever a seller of goods, instead of taking cash at once in payment, gives time for payment, he is said to give credit. Custom has made usual the use of documents or instruments by which the buyer promises to pay the debt. The chief credit instruments are bills of exchange and cheques, but promissory notes and I.O.U.s are also met with.

BILLS OF EXCHANGE

§ 238. Form.-A bill of exchange is a written promise to pay a sum of money on demand or at the expiration of a given time.1 The person who gives the promise is called the acceptor, the person to whom the promise is given is called the drawer. Every bill of exchange may, like other contracts, be resolved into a proposal and an acceptance. The proposal takes the following form :—

1 The following definition is given in the Bills of Exchange Act 1882: "A bill is an unconditional order given in writing, addressed by one person to another, signed by the person granting it, requiring the person to whom it is addressed to pay on demand, or at a fixed or determinable future time, a certain sum in money to the order of a specified person or to bearer."

LONDON, 1st January 1893.

£1000

One month after date pay to my order One Thousand Pounds.

To C. D.

A. B.

This form is merely a request or proposal made by A. B. to C. D., asking C. D. to pay £1000 one month after the 1st January 1893. C. D. by writing the word "accepted" across the bill and signing his name and delivering the bill to the drawer, undertakes to comply with the request, and if the bill be duly stamped, a valid contract arises between the parties.

§ 239. Inland and Foreign Bills.-Bills of exchange are either inland or foreign. An inland bill is one which is or purports to be both drawn and payable within the British Islands. Any other bill is a foreign bill. A foreign bill usually consists of a set of three bills, each bill being numbered and containing a reference to the other bills. These bills being transmitted separately, the risk of losing the bill is greatly diminished, as any one bill of the set being paid, the other two bills of the set are of no use. The following is a form of a foreign bill :—

For Rs. 550.

LONDON, 1st January 1893.

At sixty days after sight of this first of exchange (second and third unpaid), pay to the order of C. D. Five hundred and fifty rupees value received of them, and place the same to account.

To E. F.

A. B.

§ 240. Amount.-The amount is usually specified in figures on the upper left-hand corner, and in writing in the body of the instrument.

§ 241. Stamp.-A bill, if drawn and made payable in the

United Kingdom, should be stamped with the proper stamp, i.e.—

For every £100, and also for every fractional part

of £100

IS.

If the bill is payable on demand, and the amount of the stamp is id., an adhesive stamp may be used in all other cases an impressed stamp is required. A bill drawn abroad requires no stamp, unless it is expressed to be payable, or is endorsed or paid, in the United Kingdom. Any person issuing, endorsing, transferring, or paying a bill not being duly stamped, is liable to a penalty of £10, and the person taking the bill cannot recover on it.

§ 242. Date.-A bill should be dated, but if not dated it is not invalid, as it is regarded as dating from the time it was issued, i.e. from the date of delivery of the bill by the acceptor to the drawer.

§ 243. The Time for Payment. The parties may, in the bill, fix a time for payment, which may be at the expiration of a given time from the date of the bill, as in the first example above given. The time may be fixed with reference to the presentation of the bill to C. D. for payment, or it may be when payment is demanded. If no time

be fixed, the bill is payable on demand.

Though a bill need not be presented for payment in order to charge the acceptor, it must be so presented to charge the drawer or an endorser. If the bill be payable on demand, it should be presented within a reasonable time after its issue; if not payable on demand, then presentment should be made on the day it is due, three days of grace being added to the time of payment, the bill being regarded as due on the last of these days. If the last day of grace falls on Sunday, Christmas Day, or Good Friday, the bill is payable on the previous day: if the last day is on a bank holiday (other than Christmas Day and Good Friday), or if

the last day of grace is a Sunday, and the previous day is a bank holiday, the bill is payable on the succeeding business day.

§ 244. The Place of Payment. It is desirable that the parties should specify the place of payment. If no place be specified, but the acceptor's address is given in the bill, it is payable at such address. The acceptor may fix the place of payment when accepting, but in order to do so he must not only accept the bill to pay at a particular place, but state that it is to be paid there and nowhere else.

If no place of payment or address be given in the bill, the place of payment is the place of business of the acceptor, if known, but if not known, then his ordinary residence. If neither his place of business nor his ordinary residence be known, the place of payment is wherever he can be found, or his last known place of business or residence.

§ 245. The Position of the Acceptor.-The acceptor engages to pay the bill. If, however, he has accepted with certain qualifications, e.g. as to time, or place, or amount, he is only bound to pay subject to such qualifications. As far as the acceptor's liability is concerned, he is not entitled to any presentation of the bill for payment, or any demand of the money due. It is, however, usual and desirable to present a bill for payment when due. If the bill be not paid by the acceptor, it is said to be dishonoured.

§ 246. Transfer.-A bill of exchange may be transferred by the holder unless it contains words prohibiting any transfer. A bill payable to bearer is transferred by delivery: a bill payable to order is transferred by endorsement of the holder, followed by delivery. The transfer of a bill payable to bearer by delivery without endorsement imposes no liability on the transferrer, but a transfer by endorsement and delivery imposes important duties on the parties, and it is therefore necessary to examine the position of the drawer, of the endorser, and of the holder.

§ 247. Position of the Drawer.—Where the amount is payable to the drawer, he has only to receive the amount. But if the amount is payable to a third party, the drawer, in case the bill be not paid by the acceptor, is liable to pay the