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force relating to such corporations. A trading corporation has implied capacity for the purposes of its business, but a nontrading corporation must have in its charter terms broad enough to amount to an

express power.

A signature by procuration operates as notice that the agent has but limited authority to sign, and the principal is bound thereby only if the agent is acting within the actual limits of his authority. A person who signs a bill as a drawer, endorser or acceptor, and adds words to his signature indicating that he signs for or on behalf of a principal, or in a representative capacity character, cannot be held personally liable thereon, but the mere addition of words describing himself as an agent or representative does not exempt him from personal liability.

A partner in a trading firm has prima facie authority to draw, endorse, and accept bills in the name of the firm for its business purposes, and in the hands of a holder in due course this presumption becomes absolute, whether the act was done for partnership purposes or not; however, in the case of a nontrading firm the holder must show that the partner had either actual or ostensible authority.

CONSIDERATION

A bill need not specify the value given or that any value was given therefor, as every party whose signature appears on the bill is prima facie assumed to be a party thereto for value. The consideration in the case of a bill of exchange may consist of any consideration sufficient to support a simple contract, or of any antecedent debt or liability. An accommodation party is liable on a bill to a holder for value, and it is immaterial whether such holder knew such party to be an accommodation party or not.

ACCEPTANCE

The acceptance of a bill is defined as the signification by the drawee of his assent to the order of the drawer. An acceptance is either general or qualified. A general acceptance is one which assents without qualifications to the order of the drawer. If qualified, the acceptance varies in express terms the effect of the bill as drawn. Thus, a qualified acceptance may be (a) conditional, that is, dependent on the fulfillment of a certain condition; (b) partial, when the acceptance is to pay only part of the amount; (c) where acceptance is given by some but not all of the drawees; or (d) when time of payment is changed. But an acceptance to pay at a particular specified place is not conditional or qualified. The holder of a bill may refuse to take a qualified acceptance and if he does not obtain an unqualified acceptance may treat the bill as dishonored by non-acceptance. Where the holder, without the expressed or implied authority or subsequent consent of the drawer or an endorser, takes a qualified acceptance, he discharges such drawer or endorser from liability on the bill, but such discharge does not occur in the case of a partial acceptance whereof due notice has been given.

Where a bill is payable at sight or after sight, presentment for acceptance is necessary in order to fix the maturity of the instrument, and if a bill expressly stipulates that it be presented for acceptance,

or if it is drawn payable elsewhere than at the residence or place of business of the drawee (unless excused because with exercise of reasonable diligence lack of time prevented presentment before due date), it must be presented for acceptance before it can be presented for payment; in no other case is such presentment necessary in order to render liable any party to the bill. The holder of a bill payable at or after sight must either present it for acceptance or negotiate it within a reasonable time, as failure to do so discharges the drawer and all prior endorsers. It is advisable to present a bill for acceptance as soon as possible because, if refused, the parties to the bill other than the drawee become immediately liable to the holder and no presentment for payment is necessary.

The act provides the following rules to determine whether a bill has been duly presented for acceptance:

1. The presentment must be made by or on behalf of the holder to the drawee or to some person authorized to accept or refuse acceptance on his behalf, at a reasonable hour on a business day and before the bill is overdue.

2. Where a bill is addressed to two or more drawees, who are not partners, presentment must be made to them all, unless one has authority to accept for all, when presentment may be made to him only.

3. Where the drawee is dead, presentment may be made to his personal representative.

4. Where authorized by agreement or usage, a presentment through the post office is sufficient.

Presentment in accordance with the above rules is excused, and a bill may be treated as dishonored by nonacceptance under the following conditions: (a) where the drawee is dead, or a fictitious person or a person not having capacity to contract by bill; (b) where after the exercise of reasonable diligence, such presentment cannot be made; (c) where, although presentment has been irregular, acceptance has been refused on some other ground.

The drawee may accept a bill on the day it is presented to him for acceptance, or at any time within 2 days (excluding nonbusiness days) thereafter. Where a bill is not accepted within the required time, the holder must treat it as dishonored by nonacceptance, otherwise he loses his right of recourse against the drawer and endorsers.

NOTICE OF DISHONOR

A bill other than a demand bill must be presented for payment on the day it falls due, and a demand bill within a reasonable time after its issue, in order to render the drawer liable, and within a reasonable time after its endorsement, in order to render the endorser liable, unless delay is excused or presentment is dispensed with under certain conditions set out in sections 91 and 92 of the act.

Notice of dishonor of a bill, whether by nonacceptance or by nonpayment, must be given to the drawer and to each endorser, unless such notice has been waived or in some way excused, otherwise such parties will be discharged. The notice, to be valid, must be given not later than the next business day following the day of dishonor, but may be given immediately upon dishonor. Where a party re

ceives notice, he has, after such receipt, the same time to give notice to parties liable to him as the holder had. It is customary for the holder to give notice to all parties liable on the bill within the prescribed time, and thus safeguard his rights against each of them.

PROTEST

Where a foreign bill, appearing on the face of it to be such, has been dishonored by nonacceptance, it must be duly protested for nonacceptance, and where a foreign bill has not been previously dishonored by nonacceptance but is dishonored by nonpayment it must be duly protested for nonpayment. Unless a foreign bill is so protested the drawer and endorsers are discharged. In the Province of Quebec it is also necessary to note or protest an inland bill in order to have recourse against the drawer or endorsers, but in the rest of Canada inland bills need not be protested, although it is advantageous to do so as such protest is prima facie evidence of presentment and dishonor and service of notice of dishonor as stated in the protest. Protest is, of course, not necessary in order to render the acceptor of a bill liable. Protest is dispensed with by any circumstances which would dispense with notice of dishonor. Delay in noting or protesting is excused by circumstances which are beyond the control of the holder and not imputable to his default, misconduct, or negligence, but, when the cause of the delay ceases to operate, the bill must be noted or protested with reasonable diligence.

Unless excused or dispensed with according to the provisions of the act, protest must be made or noted on the day of dishonor. When a bill has been noted, the formal protest may be extended thereafter at any time as of the date of noting. If a bill is lost, destroyed, or is wrongly or accidentally detained from the person entitled to hold it, or is accidentally retained in a place other than where payable, protest may be made on a copy or written particulars of the instrument.

A bill must be protested at the place where it is dishonored, or at some place in Canada within 5 miles of the place of presentment and dishonor of such bill. Where a bill is presented through the post office and returned by post dishonored, it may be protested at the place to which it is returned not later than on the day of its return or the next juridical day. Every protest for dishonor, either for nonacceptance or nonpayment, may be made on the day of such dishonor, and in the case of nonpayment at any time after 3 o'clock in the afternoon. A protest must contain a copy of the bill, or the original bill may be annexed thereto, and it must be signed by the notary making it, and must specify the person at whose request the bill is protested, the place and date of protest, the cause or reason for protesting the bill and the demand made and answer given or the fact that the drawee or acceptor could not be found.

PROMISSORY NOTES

A promissory note is defined as an unconditional promise in writing made by one person to another, signed by the maker, engaging to pay, on demand or at a fixed or determinable future time, a sum certain in money, to, or to the order of, a specified person, or to

bearer. Such a note is incomplete until it has been delivered to the payee or bearer. A note which is, or on the face of it purports to be, both made and payable within Canada, is an inland note; any other note is a foreign note.

The provisions regarding bills of exchange apply also to promissory notes except those relating to the following matters: (a) presentment for acceptance; (b) acceptance; (c) acceptance supra protest; (d) bills in a set. If a foreign note is dishonored, protest thereof is unnecessary, except for the preservation of the liabilities of endorsers. A note payable on demand which has been endorsed must be presented for payment within a reasonable time of the endorsement, or the endorser will be discharged. However, if the note has, with the assent of the endorser, been delivered as a collateral or continuing security it need not be presented for payment so long as it is held as such security. Reasonable time is determined from the nature of the instrument, the usage of trade, and the facts of the particular case. Presentment for payment of a note is not necessary in order to hold the maker, although if action is brought against the maker of a note payable in a particular place prior to such presentment, the costs are in the discretion of the court. If a note is in the body of it made payable at a particular place, presentment at that place is necessary to render the endorser liable, but if the place of the payment is indicated by way of memorandum only, a presentment to the maker elsewhere, if sufficient in other respects, suffices to render an endorser liable.

A promissory note may be made by two or more makers, and they may then be liable jointly or jointly and severally, dependent on the contract. Where a note runs "I promise to pay," and is signed by two or more persons, it is deemed to be their joint and several note.

CHECKS

A check is defined as a bill of exchange drawn on a bank, payable on demand. Most of the provisions of the Bills of Exchange Act applicable to a bill of exchange payable on demand apply to a check. A check, however, needs no acceptance by the banker, and should the banker refuse payment, he is in no wise liable to the holder.

If a check is not presented for payment within a reasonable time after it has been drawn, and the drawer (or the person on whose account it is drawn) suffers damage through the delay, he is discharged and the holder must bear the loss, but the holder of such a check becomes a creditor, in lieu of the drawer, of such bank to extent of such discharge, and entitled to recover the amount from it. What is a reasonable time in such a case depends on the nature of the instrument, the usage of trade and of banks, and the facts in the particular

case.

The duty and authority of a bank to pay a check drawn on it by a customer are terminated by countermand of payment and notice of the customer's death.

Under the provisions of section 405 of the Criminal Code (Revised Statutes of Canada, 1927, ch. 36) everyone is guilty of an indictable offense and liable to 3 years' imprisonment who, with intent to de

fraud, obtains by any false pretense anything capable of being stolen, and then in subsection 3 (1932 amendment) of said section it is provided that in any prosecution under this section if it be shown that anything capable of being stolen was obtained by the accused by means of a check which when presented for payment within a reasonable time was dishonored on the grounds that there were no funds or not sufficient funds on deposit in the bank to the credit of the accused, it shall be presumed that such thing was obtained with fraudulent intent by false pretense unless it be established to the satisfaction of the court that when the accused issued such check he had reasonable grounds for believing that it would be honored if presented for payment within a reasonable time after it was issued.

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