BILLS OF EXCHANGE

THE BILLS OF EXCHANGE ACT

1

ARRANGEMENT OF SECTIONS

PART I. Preliminary
1. Short title.
2. Interpretation.

PART n. Bills of Exchange
Form wid Interprefruwn

3. Bill of exchange defined.
4. Inland and foreign bills.
5 . Effect where different parties to bill are the same person
6. Address of drawee.
7. Certainty required as to payee.
8. What bills are negotiable.
9. Sum payable.

10. Bill payable on demand.
11. Bill payable at a future time.
12. Omission of date in b i payable after date.
13. Antedating and postdating.
14. Computation of time of payment.
15. Case of need.
16. Optional stipulations by drawer or indorser.
17. Definition and requisites of acceptance.
18. Time for acceptance.
19. General and qualified acceptances.
20. Inchoate instruments.
21. Delivery.

Capacity and Aufhority of Parties
22. Capacity of parties.
23. Signature essential to liabfity.
24. Forged or unauthorized signature.

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2 BILLS OF EXCHANGE

25. Procuration signatures.
26. Person signing as agent or in representative capacity.

The Consideration for a Bill
27. Value and holder for value.
28. Accommodation bill or party.
29. Holder in due course.
30. Presumption of value and good faith.

Negotintion of Bills
31. Negotiation of bills.
32. Requisites of a valid indorsement.
33. Conditional indorsement.
34. Indorsement in blank and special indorsement.
35. Restrictive indorsement.
36. Negotiation of overdue or dishonoured bill.
37. Negotiation of bill to party already liable thereon.
38. Rights of the holder.

General Duties of the Holder
39. When presenment for ameptancc is necessary.
40. Time for presenting bill payable after sight.
41. Rules as to presentment for acceptance, and excuses for non-

presentment.

42. Non-acceptance.
43. Dishonour by non-acceptancc and its consequences.
44. Duties as to qualified acceptances.
45. Rules as to presentment for payment.
46. Excuses for delay or non-presentment for payment.
41. Dishonour by non-payment.
48. Notice of dishonour and effect of non-notice.
49. Rules as to notice of dishonour.
50. Excuses for non-notice and delay.
51. Noting or protest of bill.
52. Duties of holder as regards drawee or amptor.

Liabilities of Parties
53. Funds in hands of drawee.

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BILLS OF EXCHANGE 3

54. Liability of acceptor.
55. Liability of drawer or indorser.
56. Stranger signing bill liable as indorser.
57. Measure of damages against parties to dishonoured bill.
58. Transferor by delivery and transferee.

Disckge of Bill

59. Payment in due course.
60. Banker paying demand draft whereon indorkment is forged.
61. Acceptor the holder at maturity.
62. Express waiver.
63. Cancellation.
64. Alteration of bill.

Acceptance and Payment for Honour

65. Acceptance for honour supra protest.
66. Liability of acceptor for honour.
67. Payment to acceptor for honour.
68. Payment for honour supra protest.

Lost Instruments

69. Holder’s right to duplicate of lost bill.
70. Action on lost bill.

Bill in a Ser
71. Rules as to sets.

ConfliEt of Laws

72. Rules where laws conflict.

PART III. Cheques on a Banker
73. Cheque defined.
74. Presentment of chque for payment.
75. Revocation of banker’s authority.
76. General and special crossings defined.
77. Crossing by drawer or after issue.
78. Cdssing a material part of cheque.
79. Duties of banker as to crossed cheques.

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4 BILLS OF EXCHANGE

80. Protection to banker and drawer where cheque is crossed.
81. Effect of crossing on holder.
82. Protection to collecting banker.

PART IV. Promissory Notes
83. Promissory note defined.
84. Delivery necessary.
85. Joint and several notes.
86. Note payable on demand.
87. Presentment of note for payment.
88. Liability of maker.
89. Application of Part I1 to notes.

PART V. Supplementary
90. Good faith.
91. Signature.
92. Computation of time.
93. Saturdays.
94. When noting equivalent to protest.
95. Protest when Notary not accessible.
96. Dividend warrants may be crossed.
97. Savings.

SCHBDULE

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BILLS OF EXCHANGE 5

THE BILLS OF EXCHANGE ACT C.P. 40.
Ad

25 of 196%
11893.1

PART I. Preliminary
1. This Act may be cited as the Bills of Exchange Act. shorttitk

2. In this Act- Intspra-
tation. “acceptance” means an acceptance completed by delivery

“action” includes counter-claim and set+@
“banker” includes a body of persons, whether incorporated

or not, who carry on the business of banking;
“bankrupt” includes any person whose estate is vested in

a trustee or assignee under the law for the time being
in force relating to bankruptcy;

“bearer” means the person in possession of a bill or note
which is payable to bearer;

“bill” means bill of exchange and “note” means promis-
sory note;

“delivery” means transfer of possession, actual or con-
structive, from one person to another,

“holder” means the payee or indorsee of a bill or note who
is in possession of it, or the bearer thereof:

“holiday” means any day appointed by law, to be kept as
a holiday, or as a day of fast or thanksgiving, but
not Christmas Day or Good Friday;

“indorsement” means an indorsement completed by
delivery,

“issue” means the 6rst delivery of a bill or note, complete
in form, to a person who takes it as a holder;

“person” includes a body of persons, whether incorporated
or not;

or notification;

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6 BILLS OF EXCHANGE

“value” means valuable consideration;
“written” includes printed, and “writing” includes print.

PART II. Bills of Exchange
Form and Interpretation

Bill of 3. A bill of exchange is an unconditional order in
defined. writing, addressed by one person to another, signed by the

person giving 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 or to the order of a
specified person, or to bearer.

An instrument which does not comply with these condi-
tions, or which orders any act to be done in addition to the
payment of money, is not a bill of exchange.

An order to pay out of a particular fund is not uncon-
ditional within the meaning of this section; but an unquali-
fied order to pay, coupled with-

(a) an indication of a particular fund out of which
the drawee is to reimburse himself, or a parti-
cular account to be debited with the amount; or

(b) a statement of the transaction which gives rise to
the bill-

exchange

is unconditional.
A bill is not invalid by reason-

(c) that it is not dated;
(d) that it does not specify the value given, or that

any value has been given therefoc
(e) that it does not specify the place where it is

drawn, or the place where it is payable.

4. An inland bill is a bill which is, or on the face of it

@) both drawn and payable within this Island; or

Inlandand
fomgn bills purports to be-

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BILLS OF EXCHANGE

(b) drawn within this Island upon some person
resident therein.

Any other bill is a foreign bill.
Unless the contrary appear on the face of the bill, the

holder may treat it as an inland bill.

7

5. A bill may be drawn payable to or to the order of the Effectwhere
drawer; or it may be drawn payable to or to the order of partiato
the drawee. aamc pcmon.

Where in a bill drawer and drawee are the same person,
or where the drawee is a fictitious person or a pason not
having capacity to contract, the holder may treat the
instrument, at his option, either as a bill of exchange or as
a promissory note.

6. The drawee must be named or otherwise indicated in AddrssPof
a bill with reasonable certainty.

A bill may be addressed to two or more drawees, whether
they are partners or not, but an order addressed to two
drawees in the alternative, or to two or more drawees in
succession, is not a bill of exchange.

7. Where a bill is not payable to bearer, the payee must certainty
be named or otherwise indicated therein with reasonable topyM.
certainty.

Wemt

bill are the

drawee.

required a8

A bill may be made payable to two or more payees
jointly, or it may be made payable in the alternative to one
of two, or one or some of several payees. A bill may also
be made payable to the holder of an office for the time
being.

Where the payee is a fictitious or non-existing person the
bill may be treated as payable to bearer.

8. When a bill contains words prohibiting transfer, or Whatbius
indicating an intention that it should not be transferable, are

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8 BILLS OF EXCHANGE

SUm
payable.

it is valid as between the parties thereto, but is not
negotiable.

A negotiable bill may be payable either to order or to
bearer.

A bill is payable to bearer which is expressed to be SO
payable, or on which the only or last indorsement is an
indorsement in blank.

A bill is payable to order which is expressed to be so
payable, or which is expressed to be payable to a particular
person, and does not contain words prohibiting transfer or
indicating an intention that it should not be transferable.

Where a bill, either originally or by indorsement, is
expressed to be payable to the order of a specified person,
and not to him or his order, it is nevertheless payable to
him or his order at his option.

9. The sum payable by a bill is a sum certain within the
meaning of this Act, although it is required to be paid-

(a) with interest;
(6) by stated instalments;
(c) by stated instalments, with a provision that upon

default in payment of any instalment the whole
shall become due;

(d) according to an indicated rate of exchange, or
according to a rate of exchange to be ascertained
as directed by the bill.

Where the sum payable is expressed in words and also in
figures, and there is a discrepancy between the two, the sum
denoted by the words is the amount payable.

Where a bill is expressed to be payable with interest,
unless the instrument otherwise provides, interest runs
from the date of the bill, and if the bill is undated from the
issue thereof.

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BILLS OF EXCHANGE 9

Bill payable
on demand. 10. A bill is payable on demand-

(a) which is expressed to be payable on demand, or at
sight, or on presentation; or

(6) in which no time for payment is expressed.
Where a bill is accepted or indorsed when it is overdue

it shall, as regards the acceptor who so accepts, or any
indorser who so indorses it, be deemed a bill payable
on demand.

11. A bill is payable at a determinable future time within Bill pwbls
at a future the meaning of this Act which is expressed to be payable- tiimt.

(U) at a fixed period after date or sight;

(b) on or at a fixed period after the occurrence of a
specified event which is certain to happen, though
the time of happening may be uncertain.

An instrument expressed to be payable on a contingency
is not a bill, and the happening of the event does not cure
the defect.

12. Where a bill expressed to be payable at a fixed period Omission date in bdl of
after date is issued undated, or where the acceptance of a payable
bill payable at a fixed period after sight is undated, any aftcrdatr
holder may insert therein the true date of issue or accept-
ance, and the bill shall be payable accordingly :

Provided that-
(U) where the holder in good faith and by mistake

inserts a wrong date; and
(b) in every case where a wrong date is inserted,

if the bill subsequently comes into the hands of a holder in
due course, the bill shall not be avoided thereby, but shall
operate and be payable as if the date so inserted had been
the true date.

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10 BILLS OF EXCHANGE

Antedating

dating.

13. Where a bill or an acceptance, or any indorsement
on a bill is dated, the date shall, unless the contrary be
proved, be deemed to be the true date of the drawing,
acceptance or indorsement, as the case may be.

A bill is not invalid by reason only that it is antedated
or post-dated, or that it bears date on a Sunday.

and post-

Computa- 14. Where a bill is not payable on demand the day on
ofpaymcot. which it falls due is determined as follows-

Three days, called days of grace, are, in every case where
the bill itself does not otherwise provide, added to the
time of payment as fixed by the bill, and the bill is due and
payable on the last day of grace :

tion of lime

Provided that-
(a) when the last day of grace falls on a Sunday,

Christmas Day, Good Friday, or a holiday, the
bill is, except in the case hereinafter provided
for, due and payable on the preceding business
day; except that

(6) when the last day of grace is a holiday and the
second day of grace is a Sunday, Christmas or
Good Friday, the bill is due and payable on the
succeeding business day.

Where a bill is payable at a fixed period after date, after
sight, or after the happening of a specified event, the time
of payment is determined by excluding the day from which
the time is to begin to run, and by including the day of
payment.

Where a bill is payable at a fixed period after Sight, the
time begins to run from the date of the acceptance if the
bill be accepted, and from the date of noting or protest if
the bill be noted or protested for non-acceptance, or for
non-deliver y.

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BlLLS OF EXCHANGE 11

The term “month” in a bill means calendar month.

15. The drawer of a bill, and any indorser, may insert Caseof need. therein the name of a person to whom the holder may resort
in case of need, that is to say, in case the bill is dishonoured
by non-acceptance or non-payment. Such person is called
the “referee in case of need”. It is in the option of the
holder to resort to the referee in case of need or not, as he
may think fit.

16. The drawer of a bill, and any indorser, may insert Optional
stipulations therein an express stipulation negativing or limiting his own b y drawer

liability to the holder, waiving as regards himself some or Or
all of the holder’s duties.

17. The acceptance of a bill is the signification by the Definition

An acceptance is invalid unless it complies with the

(U) it must be written on the bill and be signed by the
drawee. The mere signature of the drawee with-
out additional words is sufficient;

(b) it must not express that the drawee will perform
his promise by any other means than the payment
of money.

and
requisites of
acceptane.

drawee of his assent to the order of the drawer.

following conditions, namely-

Time for
acceptance.

18. A bill may be accepted-
(U) before it has been signed by the drawer, or while

otherwise incomplete;
(b) when it is overdue, or after it has been dishonoured

by a previous refusal to accept, or by non-
payment.

When a bill payable after sight is dishonoured by non-
acceptance, and the drawee subsequently accepts it, the

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12 BILLS OF EXCHANGE

holder, in the absence of any different agreement, is entitled
to have the bill accepted as of the date of first presentment
to the drawee for acceptance.

General and 19. An acceptance is either (a) general or (b) qualified.
A general acceptance assents without qualification to the

order of the drawer. A qualified acceptance in express
terms varies the effect of the bill as drawn.

qualified

In particular an acceptance is qualified which is-
(a) conditional, that is to say, which makes payment

by the acceptor dependent on the fulfilment of a
condition therein stated,

(b) partial, that is to say, an acceptance to pay part
only of the amount for which the bill is drawn;

(c) local, that is to say, an acceptance to pay only at
a particular specified place :

An acceptance to pay at a particular place is a
general acceptance, unless it expressly states that
the bill is to be paid there only and not elsewhere;

(d) qualified as to time;
lel the acceptance of some one or more of the

20. Where a simple signature on a blank stamped paper
is delivered by the signer in order that it may be converted
into a bill, it operates as a prima fa& authority to fill it
up as a complete bill for any amount the stamp will cover,
using the signature for that of the drawer, or the acceptor,
or an indorser; and, in like manner, when a bill is wanting
in any material particular, the person in possession of it
has a prima facie authority to fill up the omission in any
way he thinks fit.

In order that any such instrument, when completed, may
be enforceable against any person who became a party

drawees, but not of all.

Inchoate
instruments.

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BILLS OF EXCHANGE 13

thereto prior to its completion, it must be filled up within
a reasonable time, and strictly in accordance with the
authority given. Reasonable time for this purpose is a
question of fact :

Provided that if any such instrument, after completion,
is negotiated to a holder in due course, it shall be valid and
effectual for all purposes in his hands, and he may enforce
it as if it had been filled up within a reasonable time, and
strictly in accordance with the authority given.

the acceptor’s or an indorser’s is incomplete and revocable,
until delivery of the instrument in order to give effect
thereto :

Provided that where an acceptance is written on a bill,
and the drawee gives notice to or according to the directions
of the person entitled to the bill that he has accepted it, the
acceptance then becomes complete and irrevocable.

As between immediate parties, and as regards a remote
party other than a holder in due course, the delivery in order
to be effectual-

(a) must be made either by or under the authority of
the party drawing, accepting or indorsing, as the
case may be;

(b) may be shown to have been conditional or for a
special purpose only, and not for the purpose of
transferring the property in the bill.

But if the bill in the hands of a holder in due course,
a valid delivery of the bill by all parties prior to him so as
to make them liable to him is conclusively presumed.

Where a bill is no longer in the possession of a party who
has signed it as drawer, acceptor or indorser, a valid and
unconditional delivery by him is presumed until the
contrary is proved.

21. Every contract on a bill, whether it be the drawer’s, Delivery.

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14 BILLS OF EXCHANGE

Capacity and Authority of Parties
Capcityof 22. Capacity to incur liability as a party to a bill is co-

extensive with capacity to contract :

Provided that nothing in this section shall enable a cor-
poration to make itself liable as drawer, acceptor or
indorser of a bill unless it is competent to it so to do under
the law for the time being in force relating to corporations.

Where a bill is drawn or indorsed by an infant, minor,
or corporation having no capacity or power to incur
liability on a bill, the drawing or indorsement entitles the
holder to receive payment of the bill, and to enforce it
against any other party thereto.

part,Cs.

Signature

liability.

23. No person is liable as drawer, indorser or acceptor,
of a bill who has not signed it as such :

Provided that where a person signs a bill in a trade or
assumed name, he is liable thereon as if he had signed it in
his own name.

The signature of the name of a firm is equivalent to the
signature, by the person so signing, of the names of all
persons liable as partners in that firm.

essential to

~~~~d~~
unauthor- ized

signamre.

24. Subject to the provisions of this Act, where a signa-
ture on a bill is forged, or placed thereon without the
authority of the person whose signature it purports to be,
the forged or unauthorized signature is wholly inoperative,
and no right to retain the bill, or to give a discharge there-
for, or to enforce payment thereof against any party thereto,
can be acquired through or under that signature, unless the
party against whom it is sought to retain or enforce pay-
ment of the bill is precluded from setting up the forgery or
want of authority :

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BILLS OF EXCHANGE 15

Provided that nothing in this section shall affect the
ratification of an unauthorized signature not amounting to
a forgery.

25. A signature by procuration operates as notice that :muration
rignames. the agent has but a limited authority to sign, and the prin-

cipal is only bound by such signature if the agent in so
signing was acting within the actual limits of his authority.

26. Where a person signs a bill as drawer, indorser or 9-9n
acceptor, and adds words to his signature indicating that agentorin
he signs for or on behalf of a principal, or in a representa- seEnk.
tive character, he is not personally liable thereon; but the
mere addition to his signature of words describing him as
an agent, or as filling a representative character, does not
exempt him from personal liability.

In determining whether a signature on a bill is that of
the principal or that of the agent by whose hand it is
written, the construction most favourable to the validity of
the instrument shall be adopted.

aignrng am

The Consideration far a Bill
27. Valuable consideration for a bill may be constituted Vnlncaod

bolder for by- Am
(a) any consideration sufficient to support a simple

contract;
(b) an antecedent debt or liability. Such a debt or

liability is deemed valuable consideration whether
the bill is payable on demand or at a future time.

Where value has at any time been given for a bill, the
holder is deemed to be a holder for value as regards the
acceptor and all parties to the bill who became parties prior
to such time.

Where the holder of a bill has a lien on it, arising either
from contract or by implication of law, he is deemed to be

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16 BILLS OF EXCHANGE

a holder for value to the extent of the sum for which he has
a lien.

Accommo-

orpaw.

28. An accomrr.odation party to a bill is a person who
has signed a bill as drawer, acceptor or indorser, without
receiving value therefor, and for the purpose of lending his
name to some other person.

An accommodation party is liable on the bill to a holder
for value; and it is immaterial whether, when such holder
took the bill, he knew such party to be an accommodation
party or not.

dation bill

Holder in 29. A holder in due course is a holder who has taken a
bill, conplete and regular on the face of it, under the
following conditions, namely-

(U) that he became the holder of it before it was over-
due, and without notice that it had been previously
dishonoured, if such was the fact;

(b) that he took the bill in good faith and for value,
and that at the time the bill was negotiated to him
he had no notice of any defect in the title of the
person who negotiated it.

In particular the title of a person who negotiates a bill
is defective, within the meaning of this Act, when he
obtained the bill, or the acceptance thereof, by fraud,
duress, or force and fear, or unlawful means, or for an
illegal consideration, or when he negotiates it in breach of
faith, or under such circumstances as amount to a fraud.

A holder (whether for value or not) who derives his title
to a bill through a holder in due course, and who is not
himself a party to any fraud or illegality affecting it, has
all the rights of that holder in due course as regards the
acceptor and all parties to the bill prior to that holder.

due counc.

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BILLS OF EXCHANGE 17

30. Every party whose signature appears on a bill is ~tnump-
p r i m facie deemed to have become a party thereto for wiucand
value. Every holder of a bill is prima fucie deemed to be podfaith.
a holder in due course; but if in an action on a bill, it is
admitted or proved that the acceptance, issue or subsequent
negotiation of the bill is affected with fraud, duress, or force
and fear, or illegality the burden of proof is shifted, unless
and until the holder proves that, subsequent to the alleged
fraud or illegality, value has in good faith been given for
the bill.

tion of

Negotiarion of Bills

person to another in such a manner as to constitute the
transferee the holder of the bill.

31. A bill is negotiated when it is transferred from one N ~ g ~ t i a -
tloo of bills.

A bill payable to bearer is negotiated by delivery.
A bill payable to order is negotiated by the indorsement

of the holder completed by delivery.
Where the holder of a bill payable to his order transfers

it for value without indorsing it, the transfer gives the
transferee such titles as the transferor had in the bill, and
the transferee in addition acquires the right to have the
indorsement of the transferor.

Where any person is under obligation to indorse a bill in
a representative capacity, he may indorse the bill in such
terms as to negative personal liability.

must comply with the following conditions, namely-
32. An indorsement, in order to operate as a negotiation, RcquisiEs

of a valid

menL
$,do*

It must be written on the bill itself, and be signed by
the indorser. The simple signature of the indorser
on the bill, without additional words, is suflicient.

An indorsement written on an allonge, or on a “copy”
of a bill issued or negotiated in a country where

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BILLS OF EXCHANGE

ment.

Indorsc-
ment in
blank and
s p c i a l
indorsc-
mcnt

“copies” are recognized, is deemed to be written
on the bill itself.

A partial
indorsement, that is to say, an indorsement which
purports to transfer to the indorsee a part only of
the amount payable, or which purports to transfer
the bill to two or more indorsees severally, does
not operate as a negotiation of the bill.

Where a bill is payable to the order of two or more
payees or indorsees who are not partners, all must
indorse, unless the one indorsing has authority to
indorse for the others.

Where, in a bill payable to order, the payee or indorse
is wrongly designated, or his name is misspelt,
he may indorse the bill as therein described,
adding, if he thinks fit, his proper signature.

Where there are two or more indorsements on a bill,
each indorsement is deemed to have been made in
the order in which it appears on the bill, until the
contrary is proved.

An indorsement may be made in blank or special. It
may also contain terms making it restrictive.

It must be an indorsement of the entire bill.

Conditional 33. Where a bill purports to be indorsed conditionally
the condition may be disregarded by the payer, and pay-
ment to the indorsee is valid, whether the condition has

indorse-

been fulfilled or not.

34. An indorsement in blank specifies no indorsee, and a

A special indorsement specifies the person to whom, or to
bill so indorsed becomes payable to bearer.

whose order, the bill is to be payable.
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BILLS OF EXCHANGE 19

The provisions of this Act relating to a payee apply,
with the necessary modifications, to an indorsee under a
special indorsement.

When a bill has been indorsed in blank, any holder may
convert the blank indorsement into a special indorsement
by writing, above the indorser’s signature, a direction to
pay the bill to or to the order of himself, or some other
person.

35. An indorsement is restrictive which prohibits the Restrictive
indorse- further negotiation of the bill, or which expresses that it ment.

is a mere authority to deal with the bill as thereby directed,
and not a transfer of the ownership thereof, as, for example,
if a bill be indorsed “pay D only”, or “pay D for the
account of X , or “pay D or order for collection”.

A restrictive indorsement gives the indorsee the right to
receive payment of the bill, and to sue any party thereto
that his indorser could have sued, but gives him no power
to transfer his rights as indorsee, unless it expressly
authorize him to do so.

Where a restrictive indorsement authorizes further trans-
fer, all subsequent indorsees take the bill with the same
rights, and subject to the same liabilities, as the first
indorsee under the restrictive indorsement.

36.-(1) Where a bill is negotiable in its origin it con- Ncgotiatioa
of overdue tinues to be negotiable until it has been (a) restrictively o r d i ~ -

indorsed, or (b) discharged by payment or otherwise.
(2) Where an overdue bill is negotiated, it can only

be negotiated subject to any defect of title affecting it at its
maturity, and thenceforward no person who takes it can
acquire or give a better title than that which the person
from whom he took it had.

honoured bilL

LTbe inclusion of this page is authorized by L.N. 480119731

20 BILLS OF EXCHANGE

(3) A bill payable on demand is deemed to be over-
due, within the meaning and for the purposes of this section
when it appears on the face of it to have been in circulation
for an unreasonable length of time. What is an unreason-
able length of time for this purpose is a question of fact.

(4) Except where an indorsement bears date after
the maturity of the bill, every negotiation is prima fade
deemed to have been effected before the bill was overdue.

(5) Where a bill which is not overdue has been dis-
honoured, any person who takes it with notice of the dis-
honour takes it subject to any defect of title attaching
thereto at the time of dishonour, but nothing in this sub-
section shall affect the rights of a holder in due course.

Negotiation
of bill to
Party

alrcady liable
thereon.

37. Where a bill is negotiated back to the drawer, or to
a prior indorser, or to the acceptor, such party may, subject
to the provisions of this Act, reissue and further negotiate
the bill, but he is not entitled to enforce payment of the
bill against any intervening party to whom he was pre-
viously liable.

Rights of 38. The rights and powers of the holder of a bill are as

He may sue on the bill in his own name.
Where he is a holder in due course, he holds the bill free

from any defect of titles of prior parties, as well as from
mere personal defences available to prior parties among
themselves, and may enforce payment against all parties
liable on the bill.

the holder. follow+

Where his title is defective-
(a) if he negotiates the bill to a holder in due course,

that holder obtains a good and complete title to
the bill; and

[The inclusion of this page is authorized by L.N. 480/1Y731

BILLS OF EXCHANGE 21

(b) if he obtains payment of the bill, the person who
pays him in due course gets a valid discharge for
the bill.

General Duties of the Holder
39. Where a bill is payable after sight, presentment for Whenprc-

acceptance is necessary in order to fix the maturity of the acceptance
instrument.

Where a bill expressly stipulates that it shall be presented
for acceptance, or where a bill is drawn payable elsewhere
than at the residence or place of business of the drawee, it
must be presented for acceptance before it can be presented
for payment.

In no other case is presentment for acceptance necessary
in order to render liable any party to the bill.

Where the holder of a bill, drawn payable elsewhere than
at the place of business or residence of the drawee, has not
time, with the exercise of reasonable diligence, to present
the bill for acceptance before presenting it for payment on
the day that it falls due, the delay caused by presenting the
bill for acceptance before presenting it for payment is
excused, and does not discharge the drawer and indorsers.

aentmcnt for

IS necessary.

40. Subject to the provisions of this Act, when a bill Timefor
payable after sight is negotiated, the holder must either bfi~pa, .abl~
present it for acceptance or negotiate it within a reasonable whr
time.

If he do not do so, the drawer and all indorsers prior to
that holder are discharged.

In determining what is a reasonable time within the
meaning of this section, regard shall be had to the nature
of the bill, the usage of trade with respect to similar bills,
and the facts of the particular case.

presenting

[The inclusion of this page is authorized by L.N. 480/19731

22 BlLLS OF EXCHANGE

Rules as to
resentment P or a m p -

tan-. and
excuses for
non-prewnt-
rnent.

41. A bill is duly presented for acceptance which is

(a) 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.

(b) 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, then presentment may be made to him only.

(c) Where the drawee is dead, presentment may be
made to his personal representatives.

(4 Where the drawee is bankrupt, presentment may
be made to him or to his trustee.

(e) Where authorized by agreement or usage, a pre-
sentment through the post office is sufficient.

Presentment in accordance with these rules is excused,
and a bill may be treated as dishonoured by non-
acceptance-

(0 where the drawee i s dead or bankrupt, or is a
fictitious person, or a person not having capacity
to contract by bill;

(ii) where, after the exercise of reasonable diligence,
such presentment cannot be effected;

(3 where, although the presentment has been irregu-
lar, acceptance has been refused on some other
ground.

The fact that the holder has reason to believe that the bill
on presentment will be dishonoured does not excuse pre-
sentment.

presented in accordance with the following rules-

NO"- 42. When a bill is duly presented for acceptance and is
not accepted within the customary time, the person present- acceptance.

m e inclusion of this page is authorized by L.N. 480119731

BILLS OF EXCHANGE

ing it must treat it as dishonoured by non-acceptance. If
he does not, the holder shall lose his right of recourse
against the drawer and indorsers.

23

Dishonour
by non- 43. A bill is dishonoured by non-acceptance-

(a) when it is duly presented for acceptance, and such ;z,E;z-
an acceptance as is prescribed by this Act is re- sequenc*l.
fused, or cannot be obtained, or

(b) when presentment for acceptance is excused and
the bill is not accepted.

Subject to the provisions of this Act, when a bill is
dishonoured by non-acceptance, an immediate right of
recourse against the drawer and indorsers accrues to the
holder, and no presentment for payment is necessary.

44.-(1) The holder of a bill may refuse to take a quali- Dutiesasto
fied acceptance, and if he does not obtain an unqualified ~ ~ ~ ~ ~ c m ,
acceptance may treat the bill as dishonoured by non-
acceptance.

(2) Where a qualified acceptance is taken, and the
drawer or an indorser has not expressly or impliedly
authorized the holder to take a qualified acceptance, or does
not subsequently assent thereto, such drawer or indorser is
discharged from his liability on the bill.

The provisions of this subsection do not apply to a par-
tial acceptance, whereof due notice has been given. Where
a foreign bill has been accepted as to part, it must be
protested as to the balance.

(3) When the drawer or indorser of a bill receives
notice of a qualified acceptance, and does not within a
reasonable time express his dissent to the holder, he shall
be deemed to have assented thereto.

[The inclusion of this page is authorized by L.N. 480/19731

24 BILLS OF EXCHANGE

Rulcsasto 45. Subject to the provisions of this Act, a bill must be
forpayment. duly presented for payment. If it be not so presented the

A bill is duly presented for payment which is presented

(a) Where the bill is not payable on demand, present-
ment must be made on the day it falls due.

(b) Where the bill is payable on demand, then, subject
to the provisions of this Act, presentment must be
made within a reasonable time after its issue in
order to render the drawer liable, and within a
reasonable time after its indorsement in order to
render the indorser liable.

In determining what is a reasonable time, regard
shall be had to the nature of the bill, the usage of
trade with regard to similar bills, and the facts
of the particular case.

(c) Presentment must be made by the holder, or by
some person authorized to receive payment on his
behalf, at a reasonable hour on a business day, at
the proper place as hereinafter defined, either to
the person designated by the bill as payer, or to
some person authorized to pay or refuse payment
on his behalf, if with the exercise of reasonable
diligence such person can there be found.

(6) A bill is presented at the proper place-

prcscntment

drawer and indorsers shall be discharged.

in accordance with the following rules-

(i) where a place of payment is specified in the
bill and the bill is there presented;

( i i ) where no place of payment is specified, but
the address of the drawee or acceptor is
given in the bill, and the bill is there
presented;

mhe inclusion of this page is authorized by L.N. 480119731

BILLS OF EXCHANGE 25

(iii) where no place of payment is specified and
no address given, and the bill is presented
at the drawee’s or acceptor’s place of
business, if known, and if not, at his ordi-
nary residence, if known;

(iv) in any other case, if presented to the drawee
or acceptor wherever he can be found, or if
presented at his last known place of business
or residence.

(e) Where a bill is presented at the proper place, and
after the exercise of reasonable diligence no person
authorized to pay or refuse payment can be found
there, no further presentment to the drawee or
acceptor is required.

(f, Where a bill is drawn upon, or accepted by two or
more persons who are not partners, and no place
of payment is specified, presentment must be made
to them all.

(g) Where the drawee or acceptor of a bill is dead, and
no place of payment is specified, presentment must
be made to a personal representative if such there
be, and with the exercise of reasonable diligence
he can be found.

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

46. Delay in making presentment for payment is excused E X C U E S ~ O ~
delay or when the delay is caused by circumstances beyond the con-

trol of the holder, and not imputable to his default, mis-
conduct or negligence. When the cause of delay ceases to payment
operate presentment must be made with reasonable
diligence.

Presentment for payment is dispensed with-
(a) where, after the exercise of reasonable diligence,

presentment, as required by this Act, cannot be
We indusion of this page is authorized by L.N. 480119731

--

26 BILLS OF EXCHANGE

Dishonour
by non-
payment.

Notice of
dishonour
and effect 01
non-notice.

effected. The fact that the holder has reason to
believe that the bill will, on presentment, be dis-
honoured, does not dispense with the necessity for
presentment;

(b) where the drawer is a fictitious person;
(c) as regards the drawer, where the drawee or

acceptor is not bound, as between himself and the
drawer, to accept or pay the bill, and the drawer
has no reason to believe that the bill would be paid
if presented,

(d) as regards an indorser, where the bill was accepted
or made for the accommodation of that indorser,
and he has no reason to expect that the bill would
be paid if presented;

(e) by waiver of presentment, express or implied.

47. A bill is dishonoured by non-payment (a) when it is
duly presented for payment and payment is refused or
cannot be obtained; or (b) when presentment is excused and
the bill is overdue and unpaid.

Subject to the provisions of this Act, when a bill is
dishonoured by non-payment, an immediate right of
recourse against the drawer and indorsers accrues to the
holder.

48. Subject to the provisions of this Act, when a bill has
been dishonoured by non-acceptance or by non-payment,
notice of dishonour must be given to the drawer and each
indorser, and any drawer or indorser to whom such notice
is not given is discharged :

Provided that-
(a) where a bill is dishonoured by non-acceptance, and

notice of dishonour is not given, the rights of a
holder in due course subsequent to the omission
shall not be prejudiced by the omission;

me inclusion of this page is authorized by L.N. 480/19731

BILLS OF EXCHANGE 21

(b) where a bill is dishonoured by non-acceptance, and
due notice of dishonour is given, it shall not be
necessary to give notice of a subsequent dishonour
by non-payment unless the bill shall in the
meantime have been accepted.

49. Notice of dishonour, in order to be valid and effec- ~ d e s a s t o
tual, must be given in accordance with the fOllOWhg dishonour.
rules-

(0) The notice must be given by or on behalf of the
holder, or by or on behalf of an indorser who, at
the time of giving it, is himself liable on the bill.

( b ) Notice of dishonour may be given by an agent,
either in his own name, or in the name of any
party entitled to give notice, whether that party
be his principal or not.

(c) Where the notice is given by or on behalf of the
holder, it enures for the benefit of all subsequent
holders, and all prior indorsers who have a right
of recourse against the party to whom it is given.

(4 Where notice is given by or on behalf of an
indorser entitled to give notice as hereinbefore pro-
vided, it enures for the benefit of the holder and
all indorsers subsequent to the party to whom
notice is given.

(e) The notice may be given in writing or by personal
communication, and may be given in any terms
which sufficiently identify the bill, and intimate
that the bill has been dishonoured by non-acoept-
ance or non-payment.

(f, The return of a dishonoured bill to the drawer or
an indorser is, in point of form, deemed a sufficient
notice of dishonour.

notice of

.-
[The inclusion of this page is authorized by L.N. 480/1973]

28 BILLS OF EXCHANGE

(9) A written notice need not be signed, and an insuffi-
cient written notice may be supplemented and
validated by verbal communication. A misdescrip
tion of the bill shall not vitiate the notice, unless
the party to whom the notice is given is in fact
misled thereby.

(h) Where notice of dishonour is required to be given
to any person, it may be given either to the party
himself, or to his agent in that behalf.

(zl Where the drawer or indorser is dead, and the
party giving notice knows it, the notice must be
given to a personal representative if such there be,
and with the exercise of reasonable diligence he
can be found.

(11 Where the drawer or indorser is bankrupt, notice
may be given either to the party himself or to the
trustee.

(k) Where there are two or more drawers or indorsers
who are not partners, notice must be given to each
of them, unless one of them has authority to
receive such notice for the others.

( I ) The notice may be given as soon as the bill is dis-
honoured, and must be given within a reasonable
time thereafter.
In the absence of special circumstances, notice is
not deemed to have been given within a reasonable
time, unless-

(i) where the person giving and the person to
receive notice reside in the same place, the
notice is given or sent off in time to reach
the latter on the day after the dishonour
of the bill;

(ii) where the person giving and the person to
receive notice reside in different places, the

[The inclusion of this page is authorized by L.N. 480119731

BILLS OF EXCHANGE 29

notice is sent off on the day after the dis-
honour of the bill, if there be a post at a
convenient hour on that day, and if there
be no such post on that day, then by the
next post thereafter.

(m) Where a bill, when dishonoured, is in the hands of
an agent, he may either himself give notice to the
parties liable on the bill, or he may give notice to
his principal. If he give notice to his principal,
he must do so within the same time as if he were
the holder, and the principal, upon receipt of such
notice, has himself the same time for giving notice
as if the agent had been an independent holder.

(n) Where a party to a bill receives due notice of dis-
honour, he has, after the receipt of such notice,
the same period of time for giving notice to ante-
cedent parties that the holder has after the dis-
honour.

(0) Where a notice of dishonour is duly addressed and
posted, the sender is deemed to have given due
notice of dishonour, notwithstanding any mis-
carriage by the post office.

50. Delay in giving notice of dishonour is excused where Excusesfor
the delay is caused by circumstances beyond the control of E:.g:y
the party giving notice, and not imputable to his default,
misconduct or negligence. When the cause of delay ceases
to operate the notice must be given with reasonable
diligence.

Notice of dishonour is dispensed with-
(U) when, after the exercise of reasonable diligence,

notice, as required by this Act, cannot be given
to or does not reach the drawer or indorser sought
to be charged,

me inclusion of this page is authorized by L.N. 480119731

30 BILLS OF EXCHANGE

Noting or
protest of
bill.

(b) by waiver, express or implied. Notice of dis-
honour may be waived before the time of giving
notice has arrived, or after the omission to give
due notice;

(c) as regards, the drawer in the following cases,
namely: (1) where drawer and drawee are the
same person; (2 ) where the drawee is a fictitious
person or a person not having capacity to contract;
(3) where the drawer is t’he person to whom the
bill is presented for payment; (4) where the drawee
or acceptor is as between himself and the drawer
under no obligation to accept or pay the bill; (5)
where the drawer has countermanded payment;

(d) as regards the indorser in the following cases,
namely: (1) where the drawee is a fictitious person
or a person not having capacity to contract and the
indorser was aware of the fact at the time he
indorsed the bill; (2) where the indorser is the
person to whom the bill is presented for payment;
(3) where the bill was accepted or made for his
accommodation.

Sl.-(l) Where an inland bill has been dishonoured it
may, if the holder think fit, be noted for non-acceptance or
non-payment, as the case may be; but it shall not be neces-
sary to note or protest any such bill in order to preserve the
recourse against the drawer or indorser.

(2) Where a foreign bill, appearing on the face of
it to be such, has been dishonoured by non-acceptance, it
must be duly protested for non-acceptance, and where such
a bill, which has not been previously dishonoured by non-
acceptance, is dishonoured by non-payment, it must be duly
protested for non-payment. If it be not so protested the
drawer and indorsers are discharged. Where a bill does
not appear on the face of it to be a foreign bill, protest
thereof in case of dishonour is unnecessary.

[The inclusion of this page is authorized by L.N. 480119731

BILLS OF EXCHANGE 31

(3) A bill which has been protested for non-accept-
ance may be subsequently protested for non-payment.

(4) Subject to the provisions of this Act, when a
bill is noted or protested it may be noted on the day of its
dishonour and must be noted not later than the next suc-
ceeding business day. When a bill has been duly noted, the
protest may be subsequently extended as of the date of the
noting.

(5) Where the acceptor of a bill becomes bankrupt or
suspends payment before it matures, the holder may cause
the bill to be protested for better security against the drawer
and indorsers.

(6) A bill must be protested at the place where it is
dishonoured :

(U) when a bill is presented through the post office, and
returned by the post dishonoured, it may be
protested at the place to which it is returned, and
on the day of its return if received during business
hours, and if not received during business hours,
then not later than the next business day;

(b) when a bill, drawn payable at the place of business
or residence of some person other than the drawee,
has been dishonoured by non-acceptance, it must
be protested for non-payment at the place where it
is expressed to be payable, and no further present-
ment for payment to or demand on the drawee is
necessary.

(7) A protest must contain a copy of the bill, and
must be signed by the notary making it, and must speczy-

(U) the person at whose request the bill is protested;
(b) the place and date of protest, the cause or reason

for protesting the bill, the demand made and the

Provided that-

[The inclusion of this page is authorized by L.N. 480/19731

32 BILLS OF EXCHANGE

answer given, if any, or the fact that the drawee
or acceptor could not be found.

(8) Where a bill is lost or destroyed, or is wrongly
obtained from the person entitled to hold it, protest may be
made on a copy or written particulars thereof.

(9) Protest is dispensed with by any circumstance
which would dispense with notice of dishonour. Delay in
noting or protesting is excused when the delay is caused by
circumstances beyond the control of the holder, and not
imputable to his default, misconduct or negligence. When
the cause of delay ceases to operate, the bill must be noted
or protested with reasonable diligence.

Duties of

regards

52. When a bill is accepted generally, presentment for
payment is not necessary in order to render the acceptor
liable.

When, by the terms of a qualified acceptance, present-
ment 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.
In order to render the acceptor of a bill liable it is not

necessary to protest it, or that notice of dishonour should
be given to him.

Where the holder of a bill presents it for payment, he
shall exhibit the bill to the person from whom he demands
payment, and when a bill is paid the holder shall forthwith
deliver it up to the party paying it.

holder as

drawee or
acceptor.

Liabilities of Parties
53. A bill, of itself, does not operate as an assignment

of funds in the hands of the drawee available for the pay-
ment thereof, and the drawee of a bill who does not accept
as required by this Act is not liable on the instrument.

Funds in

drawee.
hands of

[The inclusion of th is page is authorized by L.N. 480/19731

BILLS OF EXCHANGE 33

54. The acceptor of a bill, by accepting it- Liability of acaeptor.
(U) engages that he will pay it according to the tenor

of his acceptance;
(6) is precluded from denying to a holder in due

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

(ii) in the case of a bill payable to drawer’s
order, the then capacity of the drawer to
indorse, but not the genuineness or validity
of his indorsement;

(iii) 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, but
not the genuineness or validity of his
indorsement.

c o u r s e

55. The drawer of a bill by drawing it- Liability of
drawer or

(a) engages that on due presentment it shall be indorser.
accepted and paid according to its tenor, and that
if it be dishonoured he will compensate the holder,
or any indorser who is compelled to pay it:

Provided that the requisite proceedings on
dishonour be duly taken;

(6) is precluded from denying to a holder in due course
the existence of the payee, and his then capacity
to indorse.

The indorser of a bill by indorsing it-
(i) engages that on due presentment it shall be

accepted and paid according to its tenor, and that
if it be dishonoured he will compensate the holder,
or a subsequent indorser who is compelled to pay
it :

[The inclusion of this page is authorized by L.N. 480/19731

34 BILLS OF EXCHANGE

Provided that the requisite proceedings on
dishonour be duly taken;

(ii) is precluded from denying to a holder in due course
the genuineness and regularity in all respects of
the drawer’s signature, and all previous indorse-
ments;

(iii) is precluded from denying to his immediate or a
subsequent indorsee that the bill was at the time
of his indorsement a valid and subsisting bill, and
that he had then a good title thereto.

Stranger

liablcas
56. Where a person signs a bill otherwise than as drawer

or acceptor, he thereby incurs the liabilities of an indorser
to a holder in due course.

57. Where a bill is dishonoured, the measure of damages,
which shall be deemed to be liquidated damages shall be as

The holder may recover from any party liable on the bill,
and the drawer who has been compelled to pay the bill may
recover from the acceptor, and an indorser who has been
compelled to pay the bill may recover from the acceptor or
from the drawer, or from a prior indorser-

signing bill

Measure of

against
parties to follows-
honoured bill.

damages

dis-

(U) the amount of the bill,
(b) interest thereon from the time of presentment for

payment if the bill is payable on demand, and from
the maturity of the bill in any other case;

(c) the expenses of noting, or, when protest is neces-
sary and the protest has been extended, the
expenses of protest.

In the case of a bill which has been dishonoured abroad,
in lieu of the above damages, the holder may recover from
the drawer or an indorser, and the drawer or an indorser
who has been compelled to pay the bill may recover from
any party liable to him, the amount of the re-exchange, with
interest thereon until the time of payment.

me inclusion of this page is authorized by L.N. 480119731

BILLS OF EXCHANGE 35

Where by this Act interest may be recovered as damages,
such interest may, if justice require it, be withheld wholly
or in part, and where a bill i s expressed to be payable with
interest at a given rate, interest as damages may or may not
be given at the same rate as interest proper.

58. Where the holder of a bill payable to bearer negotiates Transferor
by delively

by delivery”. transferee.
it by delivery without indorsing it, he is called a “transferor and

A transferor by delivery is not liable on the instrument.
A transferor by delivery who negotiates a bill thereby

warrants to his immediate transferee, being a holder for
value, that the bill is what it purports to be, that he has a
right to transfer it, and that at the time of transfer he is
not aware of any fact which renders it valueless.

Discharge of Bill
59. A bill is discharged by payment in due course by or Payment

“Payment in due course” means payment made at or
after the maturity of the bill to the holder thereof in good
faith, and without notice that his title to the bill is defec-
tive. Subject to the provisions hereinafter contained, when
a bill is paid by the drawer or an indorser it is not dis-
charged; but-

(a) where a bill payable to or to the order of a third
party is paid by the drawer, the drawer may
enforce payment thereof against the acceptor, but
may not re-issue the bill;

(b) where a bill is paid by an indorser, or where a bill
payable to drawer’s order is paid by drawer, the
party paying it is remitted to his former rights as
regards the acceptor or antecedent parties, and he
may, if he thinks fit, strike out his own and sub-

in due on behalf of the drawee or acceptor. course.

me inclusion of this page is authorized by LN. 480119731

36 BILLS OF EXCHANGE

Banker
payjng
demand
draft
whereon
indorse-
ment is
forged.

Acceptor
the holder
at maturity.

Express
waiver.

Cancelh-
tion.

sequent indorsements, and again negotiate the
bill.

Where an accommodation bill is paid in due course by the
party accommodated the bill is discharged.

60. When a bill payable to order on demand is drawn on
a banker, and the banker on whom it is drawn pays the bill
in good faith, and in the ordinary course of business, it is
not incumbent on the banker to show that the indorsement
of the payee, or any subsequent indorsement, was made by
or under the authority of the person whose indorsement it
purports to be, and the banker is deemed to have paid the
bill in due course, although such indorsement has been
forged or made without authority.

61. When the acceptor of a bill is or becomes the holder
of it at or after maturity, in his own right, the bill is dis-
charged.

62. When the holder of a bill at or after its maturity
absolutely and unconditionally renounces his rights against
the acceptor the bill is discharged.

The renunciation must be in writing, unless the bill is
delivered up to the acceptor.

The liabilities of any party to a bill may in like manner
be renounced by the holder before, at or after, its maturity;
but nothing in this section shall affect the rights of a holder
in due course without notice of the renunciation.

63. Where the bill is intentionally cancelled by the holder
or his agent, and the cancellation is apparent thereon, the
bill is discharged.

In like manner any party liable on a bill may be dis-
charged by the intentional cancellation of his signature by
the holder or his agent. In such case any indorser who

We inclusion of tbir page is authorized by L.N. 480119731

BILLS OF EXCHANGE 31

would have had a right of recourse against the party whose
signature is cancelled is also discharged.

A cancellation made unintentionally, or under a mistake,
or without the authority of the holder, is inoperative; but
where a bill, or any signature thereon, appears to have been
cancelled, the burden of proof lies on the party who alleges
that the cancellation was made unintentionally, or under
a mistake, or without authority.

64. Where a bill or acceptance is materially altered with- Ateration
out the assent of all parties liable on the bill, the bill is OfbiU.
avoided except as against a party who has himself made,
authorized or assented to, the alteration, and subsequent
indorsers :

Provided that where a bill has been materially altered,
but the alteration is not apparent, and the bill is in the
hands of a holder in due course, such holder may avail
himself of the bill as if it had not been altered, and may
enforce payment of it according to its original tenor.

In particular the following alterations are material,
namely, any alteration of the date, the sum payable, ths
time of payment, the place of payment, and, where a bill
has been accepted generally, the addition of a place of pay-
ment without the acceptor’s assent.

Acceptance and Payment for Honour

dishonour by non-acceptance, or protested for better
security, and is not overdue, any person, not being a proet.
party already liable thereon, may, with the consent of the
holder, intervene and accept the bill supra protest, for the

65. Where a bill of exchange has been protested for A C C C P ~ ~ ~ C C
for honour

[The inelusion of this page is authorized by L.N. 480119731

38 BILLS OF EXCHANGE

honour of any party liable thereon, or for the honour of the
person for whose account the bill is drawn.

A bill may be accepted for honour for part only of the
sum for which it is drawn.

An acceptance for honour supra protest in order to be
valid must-

(a) be written on the bill, and indicate that it is an
acceptance for honour;

(b) be signed by the acceptor for honour.
Where an acceptance for honour does not expressly state

for whose honour it is made, it is deemed to be an accept-
ance for the honour of the drawer.

Where a bill payable after sight is accepted for honour,
its maturity is calculated from the date of the noting for
non-acceptance, and not from the date of the acceptance
for honour.

Liability 66. The acceptor for honour of a bill by accepting it
forhonour. engages that he will, on due presentment, pay the bill

according to the tenor of his acceptance, if it is not paid by
the drawee, provided it has been duly presented for
payment, and protested for non-payment, and that he
receives notice of these facts.

The. acceptor for honour is liable to the holder and to all
parties to the bill subsequent to the party for whose honour
he has accepted.

paymentto 67. Where a dishonoured bill has been accepted for
aoceptor f r honour. honour supra protest, or contains a reference in case of

need, it must be protested for non-payment before it is
presented for payment do the acceptor for honour, or
referee in case of need.

Where the address of the acceptor for honour is in the
same place where the bill is protested for non-payment, the

of acceptor

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BILLS OF EXCHANGE 39

bill must be presented to him not later than the day follow-
ing its maturity; and where the address of the acceptor for
honour is in some place other than the place where it was
protested for non-payment, the bill must be forwarded not
later than the day following its maturity for presentment
to him.

Delay in presentment or non-presentment is excused by
any circumstance which would excuse delay in presentment
for payment or non-presentment for payment.

When a bill of exchange is dishonoured by the acceptor
for honour it must be protested for non-payment by him.

68. Where a bill has been protested for non-payment, Payment
for honour any person may intervene and pay it s u p protest for the lupra

honour of any party liable thereon, or for the honour of the protest.
person for whose account the bill is drawn.

Where two or more persons offer to pay a bill for the
honour of different parties, the person whose payment will
discharge most parties to the bill shall have the preference.

Payment for honour supra protest, in order to operate as
such, and not as a mere voluntary payment, must be
attested by a notarial act of honour, which may be appen-
ded to the protest or form an extension of it.

The notarial act of honour must be founded on a
declaration made by the payer for honour, or his agent
in that behalf, declaring his intention to pay the bill for
honour, and for whose honour he pays.

Where a bill has been paid for honour, all parties
subsequent to the party for whose honour it is paid are
discharged, but -the payer for honour is subrogatkd for,
and su&s to both the rights and duties of, the holder as
regards the party for whose honour he pays, and all parties
liable to that party.

me inclusion of this page is authorized by LN. 480119731

40 BILLS OF EXCHANGE

The payer for honour, on paying to the holder the
amount of the bill and the notarial expenses incidental to
its dishonour, is entitled to receive both the bill itself and
the protest. If the holder do not on demand deliver them
up he shall be liable to the payer for honour in damages.

Where the holder of a bill refuses to receive payment
supra protest, he shall lose his right of recourse against any
party who would have been discharged by such payment.

Lost Instruments
69. Where a bill has been lost before it is overdue the

person who was the holder of it may apply to the drawer to
give him another bill of the same tenor, giving security to
the drawer, if required, to indemnify him against all
persons whatever in case the bill, alleged to have been lost
shall be found again.

If the drawer on request as aforesaid refuses to give such
duplicate bill, he may be compelled to do so.

Holder's

duplicate
Oflost

right to

Actionon 70. In any action or proceeding upon a bill, the court
or a Judge may order that the loss of the instrument shall
not be set up, provided an indemnity be given to the satis-
faction of the court or Judge against the claims of any
other person upon the instrument in question.

l o s t bill.

Bill in a Set
71. Where a bill is drawn in a set, each part of the set

being numbered, and containing a reference to the other
parts, the whole of the parts constitute one bill.

Where the holder of a set indorses two or more parts to
different persons, he is liable on every such part, and every
indorser subsequent to him is liable on the part he has
himself indorsed, as if the said parts were separate bills.

Rdesssto
IKUI.

me inclusion of thia page b authorized by L.N. 480119731

BILLS OF EXCHANGE. 41

Where two or more parts of a set are negotiated to
different holders in due course, the holder whose title first
accrues is, as between such holders, deemed the true owner
of the bill; but nothing in this subsection shall affect the
rights of a person who in due course accepts or pays the
part first presented to him.

The acceptance may be written on any part, and it must
be written on one part only.

If the drawee accepts more than one part, and such
accepted parts get into the hands of different holders in due
course he is liable on every such part as if it were a separate
bill.

When the acceptor of a bill drawn in a set pays it with-
out requiring the part bearing his acceptance to be delivered
up to him, and that part at maturity is outstanding in the
hands of a holder in due course, he is liable to the holder
thereof.

Subject to the preceding rules, where any one part of a
bill drawn in a set is discharged by payment or otherwise,
the whole bill is discharged.

Conflict of Laws Rules where
laws wn-

72. Where a bill drawn in one country is negotiated, 4icr.
accepted or payable, in another, the rights, duties and
liabilities, of the parties thereto are determined as
follows-

The validity of a bill as regards requisites in form is
determined by the law of the place of issue, and the valid-
ity, as regards requisites in form of the supervening con-
tract, such as acceptance or indorsement, or acceptance
supra protest, is determined by the law of the place where
such contract was made :

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42 BILLS OF EXCHANGE

Provided that-
(U) where a bill is issued out of this Island, it is not

invalid by reason only that it is not stamped in
accordance with the law of the place of issue;

(b) where a bill issued out of this Island conforms, as
regards requisites in form, to the law of this
Island, it may, for the purpose of enforcing pay-
ment thereof, be treated as valid as between all
persons who negotiate, hold, or become parties to
it in this Island.

Subject to the provisions of this Act, the interpretation
of the drawing, endorsement, acceptance, or acceptance
supra protest, of a bill is determined by the law of the
place where such contract is made :

Provided that, where an inland bill is indorsed in a
foreign country, the indorsement shall, as regards the
payer, be interpreted according to the law of this Island.

The duties of the holder with respect to presentment for
acceptance or payment, and the necessity for or sufficiency
of a protest or notice of dishonour, or otherwise, are
determined by the law of the place where the act is done
or the bill is dishonoured.

Where a bill is drawn out of, but payable in, this Island,
and the sum payable is not expressed in the currency of this
Island, the amount shall, in the absence of some express
stipulation, be calculated according to the rate of exchange
for sight drafts at the place of payment on the day the bill
is payable.

Where a bill is drawn in one country and is payable in
another, the due date thereof is determined according to
the law of the place where it is payable.

me indudon of this page ia authorized by L.N. 480/19731

BILLS OF EXCHANGE 43

PART III. Cheques on a Banker
73. A cheque is a bill of exchange drawn on a banker Ch-

Except as otherwise provided in this Part, and in section U/l%s

defined. payable on demand.

93, the provisions of this Act applicable to a bill of ex- s.z.
change payable on demand apply to a cheque.

Present-
ment of

74. Subject to the provisions of this Act-
where a cheque is not presented for payment within a chwwfor

PaYmcn~ reasonable time of its issue, and the drawer or the
person on whose account it is drawn had the right,
at the time of such presentment, as between him
and the banker, to have the cheque paid, and
suffers actual damage through the delay, he is
discharged to the extent of such damage, that is
to say, to the extent to which such drawer or per-
son is a creditor of such banker to a larger amount
than he would have been had such cheque been
paid;

in determining what is a reasonable time, regard shall
be had to the nature of the instrument, the usage
of trade and of bankers, and the facts of the
particular case;

the holder of such cheque, as to which such drawer or
person is discharged, shall be a creditor, in lieu of
such drawer or person, of such banker, to the
extent of such discharge, and entitled to recover
the amount from him.

75. The duty and authority of a banker to pay a cheque Revocation
of banker's drawn on him by his customer are determined by-

(1) countermand of payment;
(2) notice of the customer's death.
me inclusion of tbh page is authorized by L.N. 480/19731

44 BILLS OF EXCHANGE

Crossed Cheques
76.-(1) Where a cheque bears across its face an addition

(a) the words “and company” or any abbreviation
thereof between two parallel transverse lines,
either with or without the words “not negotiable”;
or

(b) two parallel transverse lines simply, either with or
without the words “not negotiable”,

that addition constitutes a crossing, and the cheque is
crossed generally.

(2) Where a cheque bears across its face an addition
of the name of a banker, either with or without the words
“not negotiable”, that addition constitutes a crossing, and
the cheque is crossed specially, and to that banker.

77.-(l) A cheque may be crossed generally or specially
by the drawer.

(2) Where a cheque is uncrossed, the holder may
cross it generally or specially.

(3) Where a cheque is crossed generally, the holder
may cross it specially.

(4) Where a cheque is crossed generally or specially,
the holder may add the words “not negotiable”.

(5 ) Where a cheque is crossed specially, the banker
to whom it is crossed may again cross it specially to another
banker for collection.

(6) Where an uncrossed cheque, or a cheque crossed
generally, is sent to a banker for collection, he may cross it
specially to himself.

of-

78. A crossing authorized by this Act is a material part
of the cheque; it shall not be lawful for any person to

inclupion of this page ia iuthorivod by LN. 480119731

Gencral and
a m i d .
emarings
debcd.

Crossing by
drawer or
after ime.

crowing a
material
part of
cheque.

BILLS OF EXCHANGE 45

obliterate or, except as authorized by this Act, to add to or
alter the crossing.

79.41) where a cheque is crossed specially to more than Dutlesof one banker, except when crossed to an agent for collection, crowed bank r as to
being a banker, the banker on whom it is drawn shall refuse
payment thereof.

(2) Where the banker on whom a cheque is drawn
which is so crossed nevertheless pays the same, or pays a
cheque crossed generally otherwise than to a banker, or if
crossed specially otherwise than to the banker to whom it is
crossed, or his agent for collection being a banker, he is
liable to the true owner of the cheque for any loss he may
sustain owing to the cheque having been so paid :

Provided that where a cheque is presented for payment
which does not at the time of presentment appear to be
crossed, or to have had a crossing which has been obliter-
ated, or to have been added to or altered otherwise than as
authorized by this Act, the banker paying the cheque in
good faith, and without negligence, shall not be responsible
or incur any liability, nor shall the payment be questioned
by reason of the cheque having been crossed, or of the
crossing having been obliterated, or having been added to
or altered otherwise than as authorized by this Act, and of
payment having been made otherwise than to a banker or
to the banker to whom the cheque is or was crossed, or to
his agent for collection being a banker as the case may be.

80. Where the banker on whom a crossed cheque is Protection
drawn, in good faith, and without negligence, pays it, if anddrawer
crossed generally, to a banker, and if crossed specially, to
the banker to whom it is crossed, or his agent for collection c r o d .
being a banker, the banker paying the cheque, and, if the
cheque has come into the hands of the payee, the drawer,
shall respectively be entitled to the same rights, and be

to banter

m e inclusion of this page is authorized by L.N. 480119731

46 BILLS OF EXCHANGE

placed in the same position, as if payment of the cheque
had been made to the true owner thereof.

Effect of

holder.

81. Where a person takes a crossed cheque which bears
on it the words “not negotiable”, he shall not have and shall
not be capable of giving a better title to the cheque than
that which the person from whom he took it had.

crossing on

Protection 82. Where a banker, in good faith and without negli-
gence, receives payment for a customer of a cheque crossed
generally, or specially to himself, and the customer has
no title or a defective title thereto, the banker shall not
incur any liability to the true owner of the cheque by reason
only of having received such payment. A banker receives
payment of a crossed cheque for a customer within the
meaning of this section notwithstanding that he credits
his customer’s account with the amount of the cheque
before receiving payment thereof.

to collecting

PART IV. Promissory Notes
83.-(1) A promissory note is 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 deter-
minable future time, a sum certain in money, to or to the
order of a specified person, or to bearer.

(2) An instrument in the form of a note payable to
maker’s order is not a note within the meaning of this
section unless and until it is endorsed by the maker.

(3) A note is not invalid by reason only that it
contains also a pledge of collateral security with authority
to sell or dispose thereof.

(4) A note which is, or on the face of it purports to
be, both made and payable within this Island is an inland
note. Any other note is a foreign note.

Promissory
note defined.

[The inclusion of this pasc ia authorized by LN. 480/19731

BILLS OF EXCHANGE 47

84. A promissory note is inchoate and incomplete until filivcry
necessary delivery thereof to the payee or bearer.

makers, and they may be liable thereon jointly, or jointly not-.
and severally, according to its tenor.

(2) 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.

8541) A promissory note may be made by two or more JOOFP“

8 6 4 1 ) Where a note payable on demand has been Notepay
able on

indorsed, it must be presented for payment within a reason- demand
able time of the indorsement. If it be not so presented the
indorser is discharged.

(2) In determining what is a reasonable time,
regard shall be had to the nature of the instrument, the
usage of trade, and the facts of the particular case.

(3) Where a note payable on demand is negotiated,
it is not deemed to be overdue, for the purpose of affecting
the holder with defects of title of which he had no notice, by
reason that it appears that a reasonable time for presenting
it for payment has elapsed since its issue.

8741) Where a promissory note is in the body of it hescat-
made payable at a particular place, it must be presented for notefor
payment at that place in order to render the maker liable. payment
In any other case, presentment for payment is not necessary
in order to render the maker liable.

(2) Presentment for payment is necessary in order
to render the indorser of a note liable.

(3) Where a note is in the body of it made payable
at a particular place, presentment at that place is necessary
in order to render an indorser liable; but when a place of
payment is indicated by way of memorandum only, present-
ment at that place is sufficient to render the indorser liable,

men1 of

[Imc incIusion of tbii page IS authonzod by L.N. 480119731

48 BILLS OF EXCHANGE

but a presentment to the maker elsewhere, if sficient in
other respects, shall also suffice.

Liabllityof 88. The maker of a promissory note by making it-
maker.

(a) engages that he will pay it according to its tenor;
(b) is precluded from denying to a holder in due course

the existence of the payee and his then capacity
to indorse.

A licatlon @.-(I) Subject to the provisions in this Part, and
tonot-. except as by this section provided, the provisions of this

Act relating to bills of exchange apply, with the necessary
modifications, to promissory notes.

(2) In applying those provisions, the maker of a
note shall be deemed to correspond with the acceptor of a
bill, and the first indorser of a note shall be deemed to
correspond with the drawer of an accepted bill payable to
drawer’s order.

(3) The following provisions as to bills do not apply
to notes, namely, provisions relating to-

(a) presentment for acceptancq
(b) acceptance;
(c) acceptance supra protest;
(d) bills in a set.

o P L t I1

(4) Where a foreign note is dishonoured, protest
thereof is unnecessary.

PART V. Supplementary
90. A thing is deemed to be done in good faith within

the meaning of this Act, where it is in fact done honestly
whether it is done negligently or not.

Goodfaith.

Signatura 91.-(1) Where, by this Act, any instrument or writing
is required to be signed by any person, it is not necessary

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BILLS OF EXCHANGE 49

that he should sign it with his own hand, but it is sufficient
if his signature is written thereon by some other person by
or under his authority.

(2) In the case of a corporation, where by this Act
any instrument OT writing is required to be signed, it is
sufficient if the instrument or writing be sealed with the
corporate seal.

But nothing in this section shall be construed as requiring
the bill or note of a corporation to be under seal.

92. Where, by this Act, the time limited for doing any Comwuh-
lion act or thing is less than three days, in reckoning time, non- of t,me.

business days are excluded.

Sunday, Good Friday, Christmas Day or any holiday.
“Non-business days” for the purposes of this Act mean

Any other day is a business day.

93.-(1) In all matters relating to bills or notes- Saturdays.
2511968

(a) if the time for doing any act or thing expires or s.3.
falls on a Saturday, that time is deemed to expire or
fall, as the case may be, on the next succeeding
business day;

(b) a bill or note payable on demand cannot be duly
presented for acceptance or payment on a Satur-
day; and

(c) failure to do my act or thing on a Saturday does
not give rise to any rlghts.

(2) Notwithstanding any other provision of this Act,
a cheque may be presented and paid on a Saturday if the
drawee is open for business at the time of the presentment
and the presentment in all other respects is in accordance
with this Act; and the non-acceptance or non-payment of a
cheque so presented gives rise to the same rights as though

mc inclusion of this page 16 authomd by L.N. 480119731

54 BILLS OF EXCHANGE

it had been presented on a business day other than a
Saturday.

When
noting
equivalent
10 protest.

Protst
when
Notary
not
accesible.

Schedule.

Dividend
warrants
may be
croswd

Savings.

p4. For the purposes of this Act, where a bill or note is
required to be protested within a specified time, or before
some further proceeding is taken, it is sufficient that the bill
has been noted for protest before the expiration of the
specified time, or the taking of the proceeding; and the
formal protest may be extended at any time thereafter as
of the date of the noting.

95. Where a dishonoured bill or note is authorized or
required to be protested, and the services of a Notary cannot
be obtained at the place where the bill is dishonoured, any
householder or substantial resident of the place may, in the
presence of two witnesses, give a certificate, signed by them,
attesting the dishonour of the bill, and the certificate shall
in all respects operate as if it were a formal protest of the
bill.

The form given in the Schedule may be used with neces-
sary modifications, and if used shall be sufficient.

96. The provisions of this Act as to crossed cheques shall
apply to a warrant for payment of dividend.

97.-(1) The rules in bankruptcy relating to bills of
exchange, promissory notes and cheques, shall continue to
apply thereto, notwithstanding anything in this Act
contained.

(2) The rules of common law, including the law
merchant, save in so far as they are inconsistent with the
express provisions of this Act, shall continue to apply to
bills of exchange, promissory notes and cheques.

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BILLS OF EXCHANGE

(3) Nothing in this Act shall dect-
(a) the provisions of the Stamp Duty Act, or any

enactment amending the same, or any law or
enactment for the time being in force relating to
the Revenue;

(b) the provisions of the Companies Act or any
enactment amending it, or any law relating to
Joint Stock Banks or Companies.

51

me inclusion of lhia pp is authorhd by L.N. 480IIg731

52 BILLS OF EXCHANGE

(section 95) SCHEDULE

Form of protest which may be used when the services of a Notary
cannot be obtained ,

Know all men that I , A . B.. householder, of
in the parish of , in the Island of Jamaica, at the
request of C.D.. there being no Notary Public available, did on the

day of . 19 , at ' .demand
payment (or acceptawe) of the bill of exchange hereunda written, from
E.F., to which demand he made answer (stare answer, if m y ) where-
fore I now, in Phc presence of G.H.. and IX.. do protest the said bill of
exchange.

I . K . 1
N.B.-The Bill itself should be annexed, or a copy of the bill and all

that is written thereon should be underwritten.

we inclusion of thia page is Puthorired by L.N. 480/19731