Sec. 46. When such presentment is dispensed with. 2. Presentment for payment is dispensed with (a) Where, after the exercise of reasonable diligence, presentment, as required by this Act, cannot be effected; 2 The fact that the holder has reason to believe that the bill will, on presentment, be dishonored, does not dispense with the necessity for presentment; 3 (b) Where the drawee is a fictitious person; 4 (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; 5 (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.6 1 The holder of a bill is bound by his implied undertaking or duty to every other party to the bill, to present it to the acceptor at maturity for payment, to allow no extra time, and in case of non-payment to give notice, and do all proper acts required by law, without delay to every such party, of the dishonor of the bill. A default in any of these respects will discharge the party in respect to whom there has been any such default, and who otherwise would be bound to pay the same, from all responsibility on account of the non-acceptance or non-payment of the bill, and will operate as a satisfaction of any debt or demand for which it was given Story on Bills, s. 112. But this clause provides for relief from this absolute rule, in cases of vis major, nor imputable to the holder's default, misconduct, or negligence. These terms are also used in s. 50, as to delay in giving notice of dishonor; and in s. 51, sub-s. 9, as to delay in noting or protesting a dishonored bill. Of each of these delinquencies there are degrees, and they are graduated according to such incidents as relationship, or duty, or results. They have entered into judicial consideration in cases affecting a trustee and his cestui que trust, principal and surety, bailor or bailee, principal and agent, master and servant. In some classes of relationship simple default, or simple negligence, will create a liability in one who, by himself or another, is held to be legally responsible for the result; while in other classes of relationship such default or negligence, though hurtful, will bring no penalty on the defaulting or negligent one; the degree in such case must be wilful default, or culpable or gross Sec. 46. negligence. And these, in their turn, may be affected by the incidents of concurring or contributory default or negligence or misconduct, on the part of the other party. The standard according to which the duties prescribed and defined by the Act, are to be performed, is, apparently from its frequent use throughout the Act, that of "reasonable diligence;" and it may therefore fairly be assumed, until judicial authority otherwise interprets, that the "default" and "negligence" (being what may be defined as passive delinquencies), described in the Act, may mean such degree of default or negligence as is the reverse of reasonable diligence, and which has been defined by Blackburn, J., in Swan v. North British Australian Co., 11 W. R. 862, to be "the neglect of some duty cast upon the party who is guilty of it, and for which no excusable fact can be established ;" and that "misconduct” (being what may be defined as an active delinquency), may receive its ordinary signification, and be applied accordingly, without any intervening locus penitentia. The law may be severe in laying so high a penalty on an omission; but an omission from incapacity or inability is one thing, an omission from negligence is another. The neglect of doing a particular act is an offence; a mere omission to do it, as in the case of prevention by superior force, is not an offence: Per Lord Denman, C. J., in King v. Burrell, 12 A. & E. 467. Neglect is an omission to do that which it was in his power, and within his duty to do, without having any lawful excuse for the omission. Forgetfulness or carelessness is certainly not a sufficient excuse: Per Coleridge, J., ibid. Mistake of duty and honest intentions will not excuse: Amy v. Supervisors, 11 Wall. 136. ILLUSTRATIONS. It is no excuse for non-presentment of a note for payment that it was indorsed when overdue: Davis v. Dunn, 6 U. C. Q. B. 327. A bill drawn on Leghorn was not presented in due time, owing to the political state of the country at that time, which rendered it impossible to present it ;-Held, that it being afterwards presented for payment with due diligence, and refused for want of presentation at the time when it was due, the holder might recover against the antecedent parties: Patience v. Townley, 2 Smith 223. A bill of exchange was drawn and indorsed in England, and was accepted by the drawee in Paris, and was payable on the 5th October, 1870. Before that date the Franco-Prussian war broke out, and the Government of France enlarged the time for the payment, and protesting of current bills of exchange from time to time, by which the bill did not become payable until the 5th September, 1871. On that day the bill was presented, and payment refused by the acceptors, and was then duly protested ;-Held, that the presentment was sufficient to charge the indorsers: Rouquette v. Overmann, L. R. 10 Q. B. 525. Where A. on the 26th of December, received a bill payable in London, and due there on the 28th, and kept it in his own hands until the 29th, when he sent it by post to his bankers at Lincoln, who duly forwarded it to London for presentment, and the bill was dishonored ;-Held, that by keeping it in his hands until the 29th, he was guilty of laches: Anderton N. Beck, 16 East 248. Sec. 46. A note due at C. was sent to a bank there for collection, and a bank clerk made several ineffectual attempts to present, but failed to make the necessary presentment of the note, by which the indorsers were discharged. The bank had issued a notice which the holder had received, that all notes delivered to them for collection should be wholly at the risk of the persons leaving them, and that the bank would be responsible only for moneys actually received in payment of such notes, but not for any omissions, informalities or mistakes, in respect of such notes ;-Held, that the omission to present the note amounted to gross negligence, and that the bank, notwithstanding the above notice, was liable: Browne v. Commercial Bank, 10 U. C. Q. B. 129; s.p., 9 U. C. Q. B. 64. A substantial distinction may be drawn between the entire omission to do an act indispensable to the collecting of a note, and an omission in the mode of doing that act; between the modis operandi, and the utter abstaining from doing anything. Therefore notwithstanding the limiting words of the notice, there was an undertaking to do any act indispensable to the collection of the note: Per Draper, J., in Ibid, 137. Where the drawee of a bill removes from his usual place of residence to another in the same state or kingdom, the holder is bound, in order to charge the indorsers, to use reasonable diligence in finding out whither he has removed, and if he succeed, to present the bill for payment. But if the drawee or maker has absconded, that circumstance will dispense with the inquiry: Reid v. Morrison, 2 Watts & Serg. 401. A creditor who takes from his debtor's agent, the cheque of such agent is bound to present it for payment within a reasonable time, and if he fails to do so, and by his delay the position of his debtor is altered for the worse, the debtor is discharged, though he was no party to the cheque : Hopkins v. Ware, L. R. 2 Ex. 268. 2 ILLUSTRATIONS. Where the maker of a note had absconded, and was absent from Canada when the note fell due;-Held, that the absence of the maker and the plaintiff's inability to find him, was a sufficient excuse for non-presentment: Forward v. Thompson, 12 U. C. Q. B. 194; s. p. Lehman v. Jones, 1 Watts & Sergt. 126. Where a joint note was made payable at a particular place, and it was not shewn that it was presented there when due, but one of the makers afterwards promised to pay it ;-Held, sufficient evidence of presentment :. Macaulay v. McFarlane, U. C. T. T. 3 & 4 Vict. A presentment of a note, payable at a bankers at G., where it is made payable, the maker being absent from G. when the note became due, is a sufficient evidence of a presentment to the maker at G.: Hardy v. Woodraffe, 2 Stark. 319. A note was made payable at the O. bank at P., but before maturity the O. bank ceased to do business at P. ;-Held, that demand of payment was dispensed with: McRobbie v. Torrance, 4 Man. R. 426 ; s. p. Roberts v. Mason, 1 Ala. 373. If the place at which the money due on simple contract is payable, ceases to exist, it is not necessary that demand for payment be made to enable the creditor to maintain an action: Ibid, 5 Man. R. 114. 3 Not only is the belief that the bill will be dishonored, no excuse in law for the omission to give notice; but prior to this Act actual knowledge, that a bill has been dishonored, acquired by other means than a notice of dishonor, will not excuse the holder giving due notice of dishonor of the Sec. 46. bill, unless the parties affected do some acts, or make some admissions, which operate as a waiver of the notice. Such notice may be verbal or written; see s. 49. ILLUSTRATIONS. The fact that the drawer or indorser had been informed that the bill has been dishonored, but might be taken up on another day, does not dispense with the necessity of giving notice of dishonor. A notice given on Wednesday of a bill dishonored the previous Saturday, is too late : Miers v. Brown, 11 M. & W. 472. Presentment to the acceptor is not excused as between the drawer's indorsee and the indorsee of such indorsee, by the mere fact that the drawer had not, at the time when the presentment should have been made, any effects in the hands of the acceptor: Saul v. Jones, 1 E. & B. 59. 4 The effect where the drawee is a fictitious person is stated in s. 5. A reasonable effect must be given in favor of bona fide holders to the act of acceptance; and where it appears that although there was a named person, he was so completely fictitious or non-existing, that the acceptor could not have intended to restrict payment to such person or his order, the acceptor, who must be taken to have intended that his acceptance should have some commercial validity, is estopped from saying that the bill was not a bill payable to bearer: Vagliano v. Bank of England, 23 Q. B. D. 260. See further the notes to ss. 5 and 7. 5 Where as between the drawer and drawees the drawees were not bound to accept, and the drawer had no reason to believe the bill would be paid, delay in presenting the bill, will not release the drawer: Re Boyse, 33 Ch. D. 612. Presentment of the bill for payment is dispensed with where the drawee is " a fictitious person;" but there is nothing in this section dispensing with presentment in the case of a person or corporation "having no capacity or power to incur liability on a bill." See s. 22. ILLUSTRATION. P. and M. exchanged cheques for the accommodation of P., and agreed that they were not to be presented before a fixed date. Before that date M.'s bankers suspended payment, and M.'s cheque was never presented, and M., on the day of their suspension, brought an action for the amount in their hands,-Held, that although the suspension would not excuse non-presentment and want of notice of dishonor, the bringing of the action against the bankers operated as a countermand of payment, and presentation and notice were unnecessary: Blackley v. McCabe, 16 App. R. 295. 6 ILLUSTRATIONS. When a note payable in Montreal, fell due, the payee and indorser wrote to the holder waiving protest of note and agreeing to hold himself liable as if it had been presented for payment; -Held, that the waiver though good against the indorser, was not evidence against the maker: McLellan v. McLellan, 19 U. C. C. P. 109. Sec. 46. Dishonor by non-payment. Where a note was made payable at a particular place, although there was no proof of its being presented there for payment, but proof of a subsequent promise ;-Held, sufficient: McIver v. McFarlane, Tay. U. C. 113. Where the maker of a note, an absconding debtor, on the day the note became due, wrote to the holder stating his inability to pay, and requesting further time;-Held, that presentment was unnecessary, although the note was payable at a particular place: McDonnell v. Lowry, 3 U. C. 9. S, 302. Where there was no presentment of a note for payment, and no notice of dishonor, a subsequent promise to pay, is a waiver: McCarthy v. Phelps, 30 U. C. Q. B. 57. Illness or other reasonable cause, not attributable to the misconduct of the holder, will excuse. But the holder must present, though the drawer may have desired the drawee not to accept: Byles on Bills, 141. See also Vaughan v. Fuller, 2 Stra. 1246; Hopely v. 275; and Reed v. Mercer, 16 U. C. C. P. 279. Dufresne, 12 East 47. A bill is dishonored by non-payment (a) when it is duly presented for payment and payment is refused or Ind. Act,s.92. cannot be obtained, or (b) when presentment is excused and the bill is overdue and unpaid: Imp. Act,s. 47 Recourse in such case. Notice of dishonor and notice. 2. Subject to the provisions of this Act, when a bill is dishonored by non-payment, an immediate right of recourse against the drawer, acceptor and indorsers accrues to the holder. 1 1 The provisions above referred to, are ss. 64 to 67 as to acceptance and payment for honor. But the holder's right of action accrues at the time notice of dishonor ought to be received, and not from the time when it is sent: Castrique v. Bernabo, 6 Q. B. 498. See also Siggers v. Lewis, 1 C. M. & R. 370. It is not too early to issue a writ on the day on which a bill is due, where the statute provides that protests for non-payment of bills or notes may be made at any time after three o'clock in the afternoon Sinclair v. Robson, 16 U. C. Q. B. 211. (See s. 51, sub-s. 6 (c)). As to what is due presentment for payment, see s. 45, and the notes thereto. And as to when presentment is excused, see s. 46, and the notes thereto. 48. Subject to the provisions of this Act, when a bill effect of non- has been dishonored by non-acceptance or by non-payment, Imp. Acts 48 notice of dishonor must be given to the drawer and each indorser, and any drawer or indorser to whom such notice is not given is discharged; 1 Provided that Ind. Act,s. 93. |