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PREFACE

TO THE FIFTEENTH EDITION.

THE success of the Code in diminishing litigation must be very gratifying to its framers, few important cases having arisen since.

In Lord Sheffield's and Simm's cases, the power of bill brokers to pledge securities en bloc was more than questioned, and the resulting lien cannot, as against the principal, exceed the sum the agent was authorised to raise upon them.

The decision in the stolen securities case (57 L. J. Q. B. 601) flowed legitimately from the dictum of Lord Ellenborough in King v. Milsom, that a presumption both of bona fides and value exists in favour of every holder of a negotiable instrument.

The long expected decision in Vagliano v. The Bank of England was given as these pages were passing through the Press. The case was, in the words of Lord Selborne, "covered by no previous authority," and caused much diversity of opinion. A merchant by blindly signing whatever a mere clerk chose to set before him, permitted forged bills for a large amount, bearing his genuine acceptance, payable at the Bank of England, to reach the Bank accompanied by a letter of advice, also bearing his signature

requesting that they should be paid. On the question whether the Bank could substantiate this payment against the customer, the C. A. found against the Bank both on the point of the alleged negligence of the plaintiff, and on those under the Code, dissentiente Lord Esher, who, while not absolving the customer from negligence, based his judgment on the points arising under s. 7 of the Code. On appeal to the House of Lords this decision was reversed by a large majority and the judgment of Lord Esher upheld. That the customer's own default misled the Bank, is the keynote of the judgments both of the Lord Chancellor and of Lord Selborne. The Lord Chancellor and Lord Herschell both hold with Lord Esher that a pretended payee, whose name was purposely selected to gain credence for the forged bill and to lull suspicion, is "fictitious" within the meaning of s. 7; and Lord Selborne, though not expressly concurring, admits the cases to be much the same in principle. And all these learned Lords uphold the view of Lord Esher, that the plain language of the Code must prevail over any different doctrines previously recognized. Though whether any such variance arose in the particular case, is doubted by Lord Herschell.

The cases of Oakeley and Bolton and Tatam and Haslar, go to show that s. 30 of the Code has shifted the burden of proof both as to bona fides and value in an action on a bill or note, when fraud or illegality is proved by the defence; thus settling the point regarded as doubtful by Lord Blackburn in Jones and Gordon. The plaintiff may easily enough show bona fides, if his own be the title in question; but it may not be so easy if he be suing as executor or trustee, or

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be standing on a prior title, a contingency clearly within s. 30.

In the National Bank v. Silke, the Court of Appeal clearly intimated that any way of attempting to render a cheque not negotiable, other than that given in the Code itself, would always have to be considered on its merits, and so be uncertain in its effect.

TEMPLE,

March 7th, 1891.

MAURICE BARNARD BYLES.

ARCHIE KIRKMAN LOYD.

PREFACE

TO THE FOURTEENTH EDITION.

THE Act to Codify the Law relating to Bills of Exchange, Cheques and Promissory Notes (45 & 46 Vict. c. 61) came into operation on the 18th of August, 1882, and introduced (with the exception of two sections, 53 (2) and 100) one uniform law for the whole of the United Kingdom.

As implied by the title, the changes introduced by the Act are not very numerous, the principal being-the recognition of the inherent negotiable quality of bills or notes even without the words "order or bearer," unless there be words prohibiting transfer or indicating that intention; and the equitable distribution of the loss occasioned by overholding a cheque when the bank fails in the interim. The holder of an office, for the time being, may now be payee, and payees may be entitled in the alternative; an indorsement may be conditional, but the party paying may disregard the condition. The duties of the holder with regard to presentment for acceptance, presentment for payment, notice of dishonour, and qualified acceptance, are clearly and amply set forth. A renunciation at maturity, to be a discharge of the bill, must be in writing, or the bill be delivered up. The rule, that the appointment of a debtor as executor operated as a release, had been already overridden in Equity, but it may be impliedly repealed by Section 61. Cheques are not necessarily inland, though, unless the contrary appear on their face, they may be treated as inland, as may all other bills or notes not

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