The question of the negotiability of such bonds and scrip is independent of the fact that the holder cannot sue the foreign government or its agents within the jurisdiction. win v. Robarts; Twycross v. Dreyfus, 1877, 5 Ch. D. 206.)

(Good

It has been said that the mere fact that bonds are overdue will not prevent a transferee in good faith and for value from acquiring a good title by estoppel. (Young v. Macnider, 1895, 25 S.C.R. 272, 278.)

Interest coupons are independent negotiable instruments (McKenzie v. Montreal, etc., 1878, 29 C.P. 333; DesRosiers v. Montreal, etc., 1883, 6 L.N. 388).

Other negotiable instruments.

Circular notes issued by a bank are negotiable instruments. The law and practice respecting them is discussed in Conflans v. Parker, 1867, L.R. 3 C.P. 1, 11-12.

Dividend warrants payable to a named person and not to his order, or to bearer, are not negotiable (Partridge v. Bank of England, 1846, 9 Q.B. 396, but see Goodwin v. Robarts, 1875, L.R. 10 Ex. at p. 354) unless they come within the definition of a bill of exchange or cheque (see Bills of Exchange Act, sec. 22). The provisions of the Act as to crossed cheques are applicable to a warrant for payment of dividend (ibid. sec. 7).

Exchequer bills are negotiable instruments. (Brandao v. Barnett, 1846, 12 Cl. & F. 787, at p. 805.)

Instruments not negotiable.

Post office orders have been held in England not to be negotiable although the Post Office regulations provide in effect that a banker's stamp will be accepted in place of the payee's receipt. (Fine Art v. Union Bank, 1886, 17 Q.B.D. 705; cf. McEntire v. Potter, 1889, 22 Q.B.D. at pp. 441-2.)

Share certificates and transfers are not negotiable instruments: see Chapter XV., supra, p. 143.

Bills of lading are not negotiable instruments: see Chapter III., supra, notes to sec. 2, of the Bank Act, p. 35. They are, however, by the custom of merchants, transferable by endorsement.

A letter of credit signed by the provincial secretary with the assent of his colleagues, but not being authorized by order in

council, constitutes no contract with the government and is not a negotiable instrument within the Bills of Exchange Act or the Bank Act so as to enable a bank to lend money upon it. (Banque Jacques-Cartier v. The Queen, 1895, 25 S.C.R. 84.)

CHAPTER XXXI.

INTRODUCTION TO THE BILLS OF EXCHANGE ACT.

The Bills of Exchange Act, 1890, being 53 Vict., c. 33, intituled "An Act relating to Bills of Exchange, Cheques and Promissory Notes, was a re-enactment with little modification of the English Bills of Exchange Act, 1882. The draftsman of the English Act was M. D. Chalmers, C.S.I., author of "A Digest of the Law of Bills of Exchange, Promissory Notes, Cheques and Negotiable Securities."

In the introduction to the third edition of that work the author said:

"Soon after the publication of the second edition of this Illustrations Digest the law relating to bills, notes, and cheques was codified must be tested by by the Bills of Exchange Act, 1882. For the most part the pro-language of positions of the Act were taken word for word from the pro-Act. positions of the Digest. In the introduction to the second edition it was pointed out that the general propositions of the Digest could only be considered as law in so far as they were correct and logical inductions from the decided cases which were cited as illustrations. Now the position is reversed. The cases decided before the Act are only law in so far as they can be shewn to be correct and logical deductions from the general propositions of the Act. The illustrations, therefore, must always be tested by the language of the Act itself."

The Bills of Exchange Act, 1882, was the first enactment codifying any branch of the Common Law. The conditions under which the experiment was successfully carried out is described by Chalmers in the following language:

"The success of the Bills of Exchange Bill depended on the Codification wise lines laid down by Lord Herschell. He insisted that the of law relating to bill should be introduced in a form which did nothing more than bills. codify the existing law, and that all amendments should be left to Parliament. A bill which merely improves the form, without altering the substance, of the law creates no opposition, and gives very little room for controversy. Of course codification pure and simple is an impossibility. The draftsman comes across doubtful points of law which he must decide one way or

of law relating to bills.

Codification the other. Again, voluminous though our case law is, there are occasional gaps which a codifying bill must bridge over if it aims at anything like completeness. Still, in drafting the Bills of Exchange bill, my aim was to reproduce as exactly as possible the existing law, whether it seemed good, bad, or indifferent in its effects. The idea of codifying the law of negotiable instruments was first suggested to me by Sir Fitz-James Stephen's Digest of the Law of Evidence, and Sir F. Pollock's Digest of the Law of Partnership. Bills, notes, and cheques seemed to form a well isolated subject, and I therefore set to work to prepare a digest of the law relating to them. I found that the law was contained in some 2,500 cases, and 17 statutory enactments. I read through the whole of the decisions, beginning with the first reported case in 1603. But the cases on the subject were comparatively few and unimportant until the time of Lord Mansfield. The general principles of the law were then settled, and subsequent decisions, though very numerous, have been for the most part illustrations of, or deductions from, the general propositions then laid down. On some points there was a curious dearth of authority. As regards such points I had recourse to American decisions, and to inquiry as to the usages among bankers and merchants. As the result, a good many propositions in the Digest, even on points of frequent occurrence, had to be stated with a (probably) or a (perhaps). Some two years after the publication of my Digest, I read a paper on the question of codifying the law of negotiable instruments before the Institute of Bankers. Mr. John Hollams, the well-known commercial lawyer, who was present, pointed out the advantages of a code to the mercantile community; and mainly I think on his advice, I received instructions from the Institute of Bankers and the Associated Chambers of Commerce to prepare a bill on the subject. The draft of the bill was first submitted to a sub-committee of the Council of the Institute of Bankers, who carefully tested such portions of it as dealt with matters of usage uncovered by authority. The bill was then introduced by Sir John Lubbock, the president of the Institute. After it had been read a second time in the Commons, it was referred to a strong select committee of merchants, bankers, and lawyers, with Sir Farrer Herschell as chairman.

"As the Scotch law of negotiable instruments differed in certain particulars from English law, the bill was originally

of law

drafted to apply to England and Ireland only. The Codification first work of the select committee was to take the evidence of relating to Sheriff Dove-Wilson of Aberdeen, a well-known authority on bills. Scotch commercial law. He pointed out the particulars in which the bill, if applied to Scotland, would alter the law there. With three exceptions the points of difference were insignificant. The committee thereupon resolved to apply the bill to Scotland, and Sheriff Dove-Wilson undertook the drafting of the necessary amendments. Eventually the Scotch rules were in three cases preserved as to Scotland, while on other points the Scotch rule was either adopted for England, or the English rule applied to Scotland. A few amendments in the law were made when the committee was unanimous in their favour, but very wisely no amendments were pressed on which there was a difference of opinion. Sir Farrer Herschell reported the bill to the House, and it was read a third time and sent up to the Lords without alteration. In the House of Lords it was again referred to a select committee with Lord Bramwell for chairman. A few amendments were there inserted, mainly at Lord Bramwell's suggestion. These were agreed to by the Commons, and the bill passed without opposition.

"The Act has now been in operation for more than eight years, so that some estimate can be formed as to its results. Merchants and bankers say that it is a great convenience to them to have the whole of the general principles of the laws of bills, notes, and cheques contained in a single Act of 100 sections. As regards particular cases which arise, it is seldom necessary to go beyond the Act itself. It must also be an advantage to foreigners who have English bill transactions to have an authoritative statement of the English law on the subject in an accessible form. If I could do the work over again, I certainly could do it better and should profit by past experience. But as it is, the Act, as yet, has given rise to very little litigation.

In Canada, early in the Parliamentary Session of 1889, a Codification bill to enact the English Bills of Exchange Act with the neces- in Canada. sary modifications was introduced into the House of Commons by Sir John Thompson, the Minister of Justice, and considered to some extent in committee. Before its introduction the bill had been distributed throughout the Dominion among the banks, chambers of commerce and boards of trade, and to other persons who manifested interest in the subject. This distribution re