d See s. 2. S. 60. e See s. 90. fA banker paying a crossed cheque in contravention of the crossing is deprived of the protection of this section.1 g This section provides an exception to sections 24 and 59 (1). It applies the principle of section 19 of the Stamp Act of 1853 to bills and notes within the meaning of this Act.2 That section is still in force, and applies to documents which do not fall under this Act, such as drafts by one branch of a bank upon another.3 The protection of these sections extends only to the banker upon whom a bill or cheque is drawn and not to one who, whether as agent or as principal, receives payment under a forged signature. If the drawer's signature is forged the sections do not apply.5 h As to payment in due course see section 59. The consideration between drawer and payee is also extinguished if the bill has come into the hands of the payee." 61. When the acceptor of a bill is or becomes the S. 61. holdera of it at or after its maturity, in his own Acceptor the right, the bill is discharged. a See s. 2. b See ss. 14 and 59, n.o • Though the acceptor of a bill becomes the holder of it in a 1 Smith v. Union Bank, 1875, 1 Q.B.D. 31, 35. 2 16 and 17 Vict. c. 59, p. 254, infra. 3 Capital and Counties Bank v. Gordon-London City and Midland Bank v. Gordon [1902], 1 K.B. 242, 273, affd. [1903] A. C. 240, 250. 4 Ogden v. Benas, 1874, L.R. 9 C.P. 513; Arnold v. Cheque Bank, 1876, 1 C.P.D. 578-decided under 16 and 17 Vict. c. 59, s. 19; Kleinwort, Sons, and Co., v. Comptoir National d'Escompte de Paris [1894], 5 See Ogden v. Benas, cit.; Clydes- 6 Charles v. Blackwell, 1877, 2 C.P.D. 151. holder at maturity. S. 61. representative capacity, for example, as executor or trustee in bankruptcy of the person entitled to payment, the bill will not be discharged.1 These words have been construed to mean further, that the acceptor must be a holder whose title has not defect, or a holder in due course. If his title is defective, the the true owner will remain entitled to demand payment of the bill. In the case of Nash v. De Freville the defender, being indebted to A., gave him three promissory notes payable on demand, and afterwards gave him two others, payable on demand, and intended to retire the first three, but neglected to obtain re-delivery of the first three. A. then, in breach of an arrangement with the defender, negotiated the five notes to the pursuer for value. The defender subsequently paid the last two notes to A. but did not call for re-delivery of them. Some months afterwards A. recovered the notes from the pursuer by giving him a worthless cheque, returned them to the defender, and absconded. It was held, reversing the judgment of the Lord Chief-Justice, that the defender was liable to the pursuer for the amount of the notes. The ratio of the judgment was, that A. had by fraud obtained the notes from the pursuer, who was holder in due course, and that the defender was in no better position than A., not being a holder in due course, (1) because he gave no value for the notes when he received them, or at least was personally barred in a question with the pursuer from pleading that he had given value,3 and (2) because he took them after maturity—that is, after payment by himself. The bill is extinguished confusione (1) if the acceptor becomes holder of a current bill and holds it till maturity, and (2) if either debtor or creditor succeeds to the other. As to the cases in which different firms may be the same person in law, see section, 5 n.o. It has been held that the discharge of a note under this section without payment does not discharge interest due on the debt for which the note was granted." 1 Thorburn, 144. 2 Nash v. De Freville [1900], 2 Q.B. 72. 3 See London and County Bank v. River Plate Bank, 1888, 21 Q.B.D. 535; Walker and Watson v. Sturrock, 1897, 35 S. L. R. 26; s. 30, n.k 4 Bell Prin. 580. 5 See s. 37. 6 Hope Johnstone v. Cornwall, 1895, 22 R. 314; but see s. 27, n.o, p. 62. с Express 62. (1.) When the holder a of a bill at or after its S. 62. maturity absolutely and unconditionally renounces his rights against the acceptor the bill is discharged.d waiver. The renunciation must be in writing, unless the bill is delivered up to the acceptor.* (2.) The liabilities of any party to a bill may in like manner be renounced by the holder before, at, or after its maturity f; but nothing in this section shall affect the rights of a holder in due course without notice of the renunciation.h a See s. 2. b See s. 59 n.o. g C c Acceptor" should be construed as meaning the acceptor and his representatives.1 Yet where a promissory note had been delivered by the payee after the death of the maker to one of the children of the maker, who under his will took a specific share of heritable estate and a legacy but was not his executor, it was held that the note was not discharged, though owing to the exhaustion of the residuary estate the estate taken by the child became liable for the debt.2 d The renunciation must be absolute and unconditional. There must be evidence not of a mere intention to renounce, but of a completed act of renunciation. A declaration of a desire to renounce is, so long as it is revocable, merely evidence of intention. The payee of a promissory note granted by the plaintiff, being at the point of death and desiring to release the plaintiff from her obligation, directed that the note should be given to him that he might destroy it. As it could not be found, he declared before the plaintiff, a nurse, and certain others, that he discharged the debt, and wished the note to be destroyed as soon as found. The nurse then wrote and signed a memorandum in the following terms:“30th August 1889.—It is Mr. George's dying wish that the S. 62. cheque for £2000 as soon as found. his sound mind." money lent to Mrs. Francis be destroyed Mr. George is perfectly conscious and in It was found that the note had not been discharged, on the ground that, on the view of the memorandum most favourable to the plaintiff, the deceased could have altered his intention and enforced the note.1 Further, there must be no reservation of the holder's rights against the drawer or indorsers. The holder of a bill, which had been dishonoured at maturity, granted a release to the acceptor as follows:-" Received from A. B. the sum of £20 in full of all claims competent to me against the acceptors, all which are hereby renounced and discharged, reserving entire my claims against any obligants other than the acceptors, presently bound to me along with the said acceptors." It was held that the bill had not been discharged, but that an indorser was liable thereon to the holder and entitled to recourse. "There is no doubt that by proper and apt instrument it is competent for the holder of a security of this kind to agree with the principal debtor not to enforce his remedies against the principal debtor; and if he does that in an instrument, which at the same time reserves his rights against those who are liable in the second degree there will be no discharge of the persons so liable. The test which has been applied to all these cases is this: Has that which has been done towards the principal debtor been a transaction of this character that it will entitle the principal debtor, if he should be sued for contribution or indemnity by the surety, to come to the creditor and say, 'You have discharged me completely and entirely from the debt, but I am now sued by a person who was surety, and that is inconsistent with the discharge I have received from you?' If, on looking at the discharge, you find that there is nothing inconsistent in it with a proceeding by the surety afterwards against the principal debtor, then the surety is not in any way discharged." 2 A conditional renunciation does not discharge the bill till 1 George, 1890, 44 Ch. D. 627. 2 Crawford v. Muir, 1873, 1 R. 91; affd. 1875 2 R. (H.L.) 148; L.R. 2 Sc. App. 456, per Lord Cairns, L. C.; the condition is purified. Till then it takes effect only as a pactum de non petendo. The holder of certain overdue promissory notes agreed by letter not to enforce them in consideration of a renewed lease being granted to him by the maker of the notes. It was held that a pactum de non petendo had been proved, under which the holder was debarred from enforcing the notes till it was decided whether a lease valid against his successors had been granted by the maker of the notes.1 All parties to the bill are discharged if the acceptor is discharged voluntarily, but not if he is discharged in bankruptcy.2 In the case of Yglesias v. River Plate Banks the facts were, that the pursuer obtained from the defenders an advance of £15,000 upon the security of goods consigned to A. and of bills drawn by him and accepted by A. After certain of the bills had been dishonoured, the pursuer gave the defenders his cheque for £2500 as further security in consideration of their refraining from selling the goods. After all the bills had been dishonoured, the pursuer consented to the sale of the goods, and the defenders entered into a judicial arrangement with A. according to the law of Uruguay, under which they sold the goods and delivered the bills to him. The price obtained, together with the £2500, did not amount to £15,000. It was found that the pursuer was discharged of his obligations as drawer of the bills, but was not entitled to recover the £2500 as if the bills had been paid. This decision proceeded on the circumstances that the pursuer was the principal obligant in the debt of £15,000, that he was liable as principal in a collateral obligation to make good any deficiency, and that A. was virtually and in fact a bankrupt. But it is clear as a general rule that the holder of a bill may not voluntarily give it up to the acceptor without obtaining full payment, and at the same time avail himself of security given by an indorser.1 • Formerly discharge had to be by writing, unless it was implied. As to the latter method, the law was by no means 1 Macvean v. Maclean, 1873, 11 M. 764. 2 S. 97, n., p. 197. 3 1877, 3 C.P.D. 60, 330. 4 As to private arrangements with creditors see Thomson, 387-8; Calder S. 62, |