holder of a bill, presenting the same for acceptance, may require the acceptance to be written on the bill. A refusal to comply shall be deemed a refusal to accept, and the bill may be treated as dishonored.52

53

In jurisdictions where acceptances are not required to be in writing, or the statutes do not otherwise modify the common law, parol acceptances are permitted. A parol acceptance is any form of words used by the drawee which by reasonable intendment can be made to signify that he honors the bill. There are some limitations to this rule. These words are to be addressed to the drawer or holder. They must be assented to by the holder. They must relate to an existing bill, for, if they pertain to a future bill, they will not be deemed an acceptance. They must be unequivocal, for, if they are equivocal, they will not be deemed an acceptance. In such expressions as “Your bill shall have attention," "I will pay the bill, but I cannot now," "I will give you a bill at three months," " there is no distinct, definite promise or agreement to pay the bill.

55

ing and "may be made" by the acceptor writing his name across the face of the bill, with or without other words. It was held that the phrase "may be made" indicates that the section is permissive only, and that any other written acceptance clearly disclosing the drawee's intention to accept will constitute an acceptance.

52 N. I. L. § 133.

53 Scudder v. Union Nat. Bank, 91 U. S. 406, 23 L. Ed. 245; Stockwell v. Bramble, 3 Ind. 428; Mason v. Dousay, 35 Ill. 424, 85 Am. Dec. 368; Sturges v. Fourth Nat. Bank of Chicago, 75 Ill. 595; St. Louis Nat. Stockyards v. O'Reilly, 85 Ill. 546; Golsen v. Golsen, 127 Ill. App. 84; Bank of Laddonia v. Bright-Coy Commission Co., 139 Mo. App. 110, 120 S. W. 648 (N. I. L.); Lumley v. Palmer, 2 Strange, 1000; Sproat v. Matthews, 1 Term R. 182; Arnold v. Sprague, 34 Vt. 402; Miller v. Neihaus, 51 Ind. 401; Pierce v. Kittredge, 115 Mass. 374.

54 Story, Bills, §§ 242–247; Edw. Bills & N. §§ 416, 417; Bayley, Bills & N. c. 6, § 109; Johnson v. Collings, 1 East, 98.

55 In Johnson v. Collings, the bill on which the action was brought was drawn by R. on defendant, the latter saying that if R. would draw such bill he would pay it on maturity. This bill was subsequently indorsed to plaintiffs. It was held that such mere promise to pay a non-existing bill did not operate as an acceptance. 1 East, 98. 56 Reynolds v. Peto, 11 Exch. 418.

They were consequently deemed by the court too uncertain to be treated as acceptances. The point to be determined is whether, by a reasonable construction, the words used will show that the acceptor recognized an immediate obligation on the part of the drawee upon him, assented to it, and declared himself bound to the payment of it as evidenced by the bill.57 Keeping in mind the expressions we have quoted, contrast them with such expressions as those used by the drawee in a case where a foreign bill had been protested for nonacceptance, and the drawee said, "If the bill comes back, I will pay it," 58 or, in another case, where the drawee said, "Leave your bill with me, and I will accept," both of which expressions were held to be sufficient acceptances. In these last expressions there was a distinct promise to honor the bill. It is probably the case that, when verbal acceptances are permitted, they will at the present day be construed with extreme strictness. It is undoubtedly the common law that they are allowable.6° But it is also equally true that they are not in accord with

59

57 In Powell v. Jones, the bill was given to the defendant for acceptance by the clerk of the plaintiff. On calling for it afterwards the defendant said: "There is your bill. It is all right." It was held -though by what was certainly a somewhat strained application of the rule that these words did not amount to an acceptance, as they did not evidence the defendant's intention to bind himself to pay at all events. 1 Esp. 17. The words, "If you will send it to the counting house again, I will give directions for its being accepted," were held to constitute only a conditional promise, and not to operate as an acceptance until the bill was actually sent back. Anderson v. Hick, 3 Camp. 179. Where the defendants agreed to accept as soon as the underwriters had settled a certain loss, it was held that such conditional acceptance could not be declared on as an absolute acceptance, when such contingency had actually happened. v. Corney, 4 Camp. 176.

58 Cox v. Coleman, Chit. Bills, 274.

591 Chit. Bills, p. 12.

Langston

60 In Spaulding v. Andrews, it was shown that, shortly after a bill was drawn, the payee, who was the holder, presented it to the drawee, and received verbal assurance that it would be paid on maturity. It was held there was an acceptance good as to a third party who obtained the bill after such parol acceptance, though he did not know of the acceptance, and that it made no difference as to when a parol acceptance was made, if after the bill was drawn. 48 Pa. 411.

the true theory of negotiability. A bill of exchange should have all its indicia upon its face. And this rule, with every other that contravenes it, complicates business operations, and clogs the circulation of an instrument as a medium of payment.

SAME-IMPLIED ACCEPTANCE

50. AN IMPLIED ACCEPTANCE-Is any act which clearly indicates an intention to comply with the request of the drawer, or any conduct of the drawee from which the holder is justified in drawing the conclusion that the drawee intended to accept the bill, and intended to be so understood."1

An implied acceptance is equally open to the objections we have made to the verbal acceptance, though the doctrine of constructive or implied acceptance is in itself consistent with justice. Its limits are not exactly defined. It may arise where the bill is detained for a long time, contrary to the usage of the parties, or withheld upon the understanding that the drawee is to accept.2 Where, however, the detention is not contrary to the usual dealings between the parties, or is due to the fact that the holder failed to call for it, the doctrine does not apply. And in general it may be said that mere retention cannot amount to acceptance. This follows from the fact that, where there.

64

63

61 Daniel, Neg. Inst. § 499; 1 Pars. Notes & B. 287. See First Nat. Bank of Cottage Grove v. Bank of Cottage Grove, 59 Or. 388, 117 Pac. 293 (N. I. L.).

62 Hall v. Steel, 68 Ill. 231; Hough v. Loring, 24 Pick. (Mass.) 254; Nason v. Barff, 2 Barn. & Ald. 26; Koch v. Howell, 6 Watts & S. (Pa.) 350.

63 Overman v. Hoboken City Bank, 30 N. J. Law, 61; Hentz v. National City Bank, 159 App. Div. 743, 144 N. Y. Supp. 979 (N. I. L.). Wisner v. First Nat. Bank of Gallitzin, 220 Pa. 21, 68 Atl. 955, 17 L. R. A. (N. S.) 1266 (N. I. L.), is contra. But see note 68.

64 Jeune v. Ward, 1 Barn. & Ald. 653; Dunavan v. Flynn, 118 Mass. 537, per Gray, C. J.; Holbrook v. Payne, 151 Mass. 383, 24 N. E. 210, 21 Am. St. Rep. 456; Colorado Nat. Bank of Denver v. Boettcher, 5 Colo. 190, 40 Am. Rep. 142; Overman v. Hoboken City Bank,

is no usage of the parties to the contrary, it is the duty of the holder to call or send for the bill, and hence no implication of acceptance can arise from the failure of the drawee to return. A fortiori, a refusal to return can give rise to no such implication, since the refusal plainly negatives an intention to accept. The same remark applies to the destruction of the bill, which, like refusal to return on demand, amounts to a conversion, but cannot, on any sound principle, imply an acceptance. In some states, however, it is provided by statute that if the drawee destroys the bill, or refuses within 24 hours after delivery, or within such other period as the holder may allow, to return the bill accepted or non-accepted, he will be deemed to have accepted. Such is the provision of the Negotiable Instruments Law. Under earlier statutes to this effect it has been held that the statutes did not cover the case of a mere failure to return, but referred to something of a tortious character, implying a conversion of the bill."

67

68

31 N. J. Law, 564; St. Louis Southwestern Ry. Co. v. James, 78 Ark. 490, 95 S. W. 804, 8 Ann. Cas. 611.

65 Jeune v. Ward, 1 Barn. & Ald. 653. Here the drawee, after refusing to accept, destroyed the bill, and it was said, Lord Ellenborough dissenting, that this did not amount to an acceptance. Bayley, J., said: "Where a bill is, in the usual course of business, left for acceptance, it is the duty of the party who leaves it to call again for it, and to inquire whether it has been accepted or not. * * I forbear to say, at present, what would be my judgment on the effect of a destruction of the instrument, by the party with whom it was left for acceptance, within the reasonable time during which the other party might expect an acceptance of the bill. If a party says he has destroyed the bill, and that he will not accept it, such destruction might probably subject him to an action of trover for the bill; but I cannot think it would amount to an acceptance of it. For, what is an acceptance? It is an engagement of the one party acceding to the proposition of the other; and it would be very strange, indeed, if a refusal on his part could in law be deemed an acceding to the proposition."

66 The statutes are collected in Rand. Com. Paper, § 620.

67 § 137.

68 Matteson v. Moulton, 11 Hun (N. Y.) 268, affirmed 79 N. Y. 627; St. Louis Southwestern Ry. Co. v. James, 78 Ark. 490, 95 S. W. 804, 8 Ann. Cas. 611; Dickinson v. Marsh, 57 Mo. App. 566. In the last case this construction was adopted by the court on the ground that

SAME-ACCEPTANCE ON SEPARATE PAPER

51. If the bill is in existence, for the convenience of business the acceptance may be on a separate paper, but the promise must be clear and unequivocal."" 52. If the bill is not in existence, for the convenience of business the acceptance may be on a separate paper. Its elements are:

(a) That the contemplated drawee shall describe the bill to be drawn, and promise to accept it.

(b) That the bill shall be drawn in a reasonable time after such promise is written.

(c) That the holder shall take the bill upon the credit of the promise.

Acceptances on a separate paper are of two classes: Those referring to a bill in existence at the time of the ac

any other would render nugatory the section of a statute providing that: "No person within this state shall be charged as an acceptor of a bill of exchange unless his acceptance shall be in writing, signed by himself or his lawful agent." N. I. L. § 137, has received the same interpretation. WESTBERG v. CHICAGO LUMBER & COAL CO., 117 Wis. 589, 94 N. W. 572 (N. I. L.), Moore Cases Bills and Notes, 95, semble. Contra: State Bank v. Weiss, 46 Misc. Rep. 93, 91 N. Y. Supp. 276 (N. I. L.); Wisner v. First Nat. Bank of Gallitzin, 220 Pa. 21, 68 Atl. 955, 17 L. R. A. (N. S.) 1266 (N. I. L.); Provident Securities & Banking Co. of Boston v. First Nat. Bank of Gallitzin, 37 Pa. Super. Ct. 17 (N. I. L.). The last three cases are erroneous. See Brannan, Anno. N. I. L. (2d Ed.) pp. 135, 136. The effect of Wisner v. Bank and Provident Co. v. Bank has been corrected by statute in Pennsylvania, Act 169, Apr. 27, 1909.

69 N. I. L. §§ 132-134. State Bank of Beaver County v. Bradstreet, 89 Neb. 186, 130 N. W. 1038, 38 L. R. A. (N. S.) 747 (N. I. L.), telegram; Eakin v. Citizens' State Bank, 67 Kan. 338, 72 Pac. 874, telegram; Lehnhard v. Sidway, 160 Mo. App. 83, 141 S. W. 430 (N. I. L.), letter, semble. Oil Well Supply Co. v. Mac Murphey, 119 Minn. 500, 138 N. W. 784; First Nat. Bank v. First Nat. Bank (D. C. Ohio) 210 Fed. 543 (N. I. L.). But the extrinsic writing must import a promise to pay the bill. First Nat. Bank of Atchison v. Commercial Sav. Bank, 74 Kan. 606, 87 Pac. 746, 8 L. R. A. (N. S.) 1148, 118 Am. St. Rep. 340, 11 Ann. Cas. 281 (N. I. L.); Plaza Farmers' Union Warehouse & Elevator Co. (Wash.) 138 Pac. 651 (N. I. L.).