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 obliterated, 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."

Sect. 80. "Where the banker, on whom a crossed cheque" (vide sects. 76, 77, ante, p. 398) "is drawn, in good faith and without negligence pays it, if crossed generally, to a banker, and if crossed specially, to the banker to whom it is crossed, or his agent for collection 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 placed in the same position as if payment of the cheque had been made to the true owner thereof."

Sect. 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."

Sect. 82. "Where a banker in good faith and without negligence 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."

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Sect. 95. The provisions of this Act as to crossed cheques shall apply to a warrant for payment of dividend."

The above sections replace the Crossed Cheques Act, 1876 (39 & 40 Vict. c. 81), which was in very similar terms.

By the Revenue Act, 1883 (46 & 47 Vict. c. 55), s. 17, the above sections, 76-82, "shall extend to any document, issued by a customer of any banker, and intended to enable any person or body corporate, to obtain payment from such banker, of the sum mentioned in such document, and shall so extend, in like manner, as if the said document were a cheque;" it does not, however, "render such document a negotiable instrument." It applies to such documents drawn on the Paymaster-General by public officers.

As the crossing is by sect. 78, ante, p. 398, a material part of the cheque, any alteration thereof will in general (see sect. 64 (1), ante, p. 385) avoid the cheque.

The above sections do not affect the negotiability of a cheque, whether crossed generally or specially, unless also marked "not negotiable." See Smith v. Union Bank of London, L. R., 10 C. P. 291; 1 Q. B. D. 31, C. A. Hence, it seems that the bona fide holder for value of a cheque crossed only, without the addition of the words "not negotiable," is the true owner thereof, to whom the banker paying the cheque otherwise than as directed by the crossing is liable under sect. 79 (2), ante, p. 398, and, that the payee or other person who was formerly holder, but lost the cheque while in a negotiable state, has no remedy given him by the section. See S. C. If, however, the cheque is also marked "not negotiable," then, although it continues to be transferable so that the holder for the time being can sue thereon, yet, by sect. 81, the holder can have no better title than his transferor had.

A

banker, however, who bona fide and without negligence collects such a cheque for a customer is protected by sect. 82. See Matthiessen v. L. & County Bank, 5 C. P. D. 7, decided on 39 & 40 Vict. c. 81, s. 12. But it seems to be otherwise where the banker at once treats the cheque as cash, as between himself and his customer, and afterwards collects the cheque for himself. Bissell v. Fox, 51 L. T., N. S. 663; Mich. S. 1884, cor. Denman, J. The protection of sect. 82 does not extend to cheques paid by a customer to his account with his banker, B., uncrossed, and which are afterwards crossed by B. to their agents for collection. S. C. As to what is negligence within sect. 82, vide S. C. The drawer of a cheque may ratify the payment made by his banker to a banker other than the one named in the crossing, and thereby make the payment a good payment by himself to the holder. Bobbett v. Pinkett, 1 Ex. D. 368. The negotiability of a cheque is not restricted by a direction, written on its face above a crossing to a bank, to pay the amount to the account of the payee at that bank. National Bank v. Silke, 90 L. T. J. 120, Dec. 10th, 1890, C. A.

Defences generally to Actions on Cheques.

Vide ante, p. 384.

ACTION ON PROMISSORY NOTES.

Statute.] The general provisions of the B. of Ex. Act, 1882, relating to promissory notes are as follows:

By sect. 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 determinable 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 indorsed by the maker.

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"(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 the British Islands is an inland note. Any other note is a foreign note."

Sect. 84. "A promissory note is inchoate and incomplete until delivery” (vide sects. 2, 21, ante, pp. 339, 343) "thereof to the payee or bearer." Sect. 85. " (1.) A promissory note may be made by two or more makers, and they may be liable thereon jointly, or jointly and severally, according

to its tenour.

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(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."

Sect. 86. (1.) Where a note payable on demand" (vide sect. 10, ante, p. 342) has been indorsed, it must be presented for payment within a reasonable 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."

Sect. 89. " (1.) Subject to the provisions in this Part" (i. e., Part IV., comprising sects. 83 to 89), "and, except as by this section provided, the

provisions of this Act" (sects. 1-72, vide ante, pp. 339-394), "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 thereto

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(a) Presentment for acceptance;

(b) Acceptance;

(c) Acceptance supra protest;

(d) Bills in a set.

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

Sect. 91 (2), ante, p. 340, enables, but does not require, a corporation to make a note under its common seal.

Sect. 86 (3), ante, p. 400, prevents sect. 36 (3), ante, p. 384, from applying to notes. It seems that by reason of the Stamp Acts (see sect. 97 (3 a), ante, p. 340), sect. 56, ante, p. 381, does not apply to notes. Vide ante, p. 242.

It follows from sect. 89, ante, p. 400, et supra, that the decisions on the corresponding sections relating to bills of exchange will apply to notes, vide ante, pp. 339-394.

Bank notes-Amount of note.] The Acts relating to the issue of promissory notes payable to bearer on demand, or bank notes, are cited under Stamps-Bank notes, ante, p. 235. Such notes must not be for less than 57.; stat. 7 Geo. 4, c. 6, s. 3. Other restrictions were placed by stats. 48 Geo. 3, c. 88, s. 2, and 17 Geo. 3, c. 30, s. 1, but these are now repealed by the B. of Ex. Act, 1882, s. 96.

Where a note was de

The plaintiff must be the holder of the note. posited with a stakeholder for the payee, and the stakeholder has refused to hand it over, the payee cannot sue on the note as holder. White, L. R., 5 H. L. 578.

Payee against Maker.

Latter v.

Liability of Maker.] Sect. 88. " The maker of a promissory note by making it

"(1.) Engages that he will pay it according to its tenour;

(2.) Is precluded from denying to a holder in due course" (vide the existence of the payee and his then

sect. 29, ante, p. 343)
capacity to indorse."

Proof of making the note.] The making of the note is proved by proving the handwriting of the defendant; or, if made by an agent, by proof of the handwriting and authority of such agent. An admission by the defendant that the handwriting is his will be sufficient proof, though it was made pending a treaty for a compromise. Waldridge v. Kennison, 1 Esp. 143. An offer on the part of the defendant, after the note has become due, to give another note to the plaintiff instead of it, is an admission of the plaintiff's title. Bosanquet v. Anderson, 6 Esp. 43. admission of his signature by one of the parties, not being partners, will only be evidence against himself. Gray v. Palmers, 1 Esp. 135.

VOL. I.

DD

An

The

An agent who makes a note in his own name will be personally liable unless he distinctly show on the face of it that he signs as agent only. See sect. 26, ante, p. 348. Thus, "On demand we jointly and severally promise to pay E. H. or order 2507., value received, for and on behalf of the W. N. Association; P. S., J. W., Directors," was held to mean jointly and personally, and, therefore, to make the persons signing individually liable. Healey v. Story, 3 Exch. 3; Penkivill v. Connell, 5 Exch. 381; Bottomley v. Fisher, 1 H. & C. 211; 31 L. J., Ex. 417. same rule applies where the note is a joint one only. Price v. Taylor, 5 H. & N. 540; 29 L. J., Ex. 331; Gray v. Raper, L. R., 1 C. P. 694; and Courtauld v. Sanders, 16 L. T., N. S. 562; T. T. 1867, C. P. So, where a note is signed by the directors of a company, and the seal of the company is affixed, they are personally liable, unless it appear on the note that they signed for the company only. Dutton v. Marsh, L. R., 6 Q. B. 361. But where the defendants, being directors of the company, signed the following note: "Three months after date we jointly promise to pay F.S. or order, 600l., for value received in stock, on account of the L. & B. Company, Limited, J. M., H. W. W., J. H., Directors," it was held that it sufficiently appeared that the note was made in the name of the company, within 19 & 20 Vict. c. 47, s. 43; and that the defendants were not personally liable. Lindus v. Melrose, 3 H. & N. 177; 27 L. J., Ex. 326, Ex. Ch.; Aggs v. Nicholson, 1 H. & N. 165; 25 L. J., Ex. 348. promissory note in the form "On demand, I promise to pay A. & Co., or order, the sum of 1,500l., with legal interest thereon until paid, value received. For Mistley, Thorpe, and Walton Ry. Co., J. S., Secretary," was held not to bind the secretary personally, although the directors were not empowered by their act of incorporation to bind the company by notes. Alexander v. Sizer, L. R., 4 Ex. 102. The Companies Act, 1862, s. 47, is similar, though wider in its terms; it is not affected by the B. of Ex. Act, 1882, vide sect. 97 (2 b), ante, p. 340. In Aggs v. Nicholson, supra, the court also rested their decision on the fact, which they held was in effect pleaded, that the defendants did not deliver the note, nor the plaintiffs take it, except as a note on behalf of the company; this is pointed out by Bramwell, B., in Price v. Taylor, supra; and this would, at any rate, be an equitable defence; per Wilde, B., S. C. See Courtauld v. Sanders, 16 L. T., N. S. 468, where such a plea was pleaded, and Wake v. Harrop, 6 H. & N. 768; 30 L. J., Ex. 273; S. C. in error, 1 H. & C. 202; 31 L. J., Ex. 451. See further cases cited ante, pp. 355 et seq.

So, a

When a note payable to the maker's own order is indorsed, it becomes a note payable to bearer, or to the indorsee, or his order, according as the indorsement is in blank or to a named person. Hooper v. Williams, 2 Exch. 13; Absolon v. Marks, 11 Q. B. 19; Brown v. De Winton, and Gay v. Lander, 6 C. B. 336. And, it makes no difference that there is a footnote to it making it payable at a particular place. Masters v. Baretto, 8 C. B. 433. By sect. 7 (2), ante, p. 341, a note may now be made payable to the holder of an office for the time being: this provision is new, see Cowie v. Stirling, 6 E. & B. 333; 25 L. J., Q. B. 335, Ex. Ch. "I promise to pay A. B. or order, three months after date, 1007., as per memorandum of agreement," is on the face of it a negotiable promissory note; and if the effect of the agreement is to make it conditional, the defendant must show it by his statement of defence. Jury v. Barker, E. B. & E. 459; 27 L. J., Q. B. 255.

Presentment for payment.] By sect. 87 (1), "Where a promissory note is in the body of it made payable at a particular place, it must be pre

sented for payment at that place in order to render the maker liable. In any other case, presentment for payment is not necessary in order to render the maker liable." When a place for payment is specified in the body of the note, presentment there must be proved, though the maker may not be there to pay, and may have absconded, and left no effects there or other means of payment. Sands v. Clarke, 8 C. B. 751. The words "payable at," &c., at the foot of a note is, from mercantile usage, a memorandum only; Masters v. Baretto, supra; and per curiam in Warrington v. Early, 2 E. & B. 766; 23 L. J., Q. B. 48. See the cases on presentment to acceptor, ante, pp. 367 et seq. In an action on a note payable on demand, a demand need not be alleged or proved; for the action itself is a demand. Rumball v. Ball, 10 Mod. 38. It is otherwise if payable after sight. Holmes v. Kerrison, 2 Taunt. 323. By sect. 10 (1) (a), ante, p. 342, replacing (34 & 35 Vict. c. 74), s. 2, promissory notes payable at sight, or on presentation, are payable on demand. If a note be made payable at a particular town, and the maker have no residence there, a presentment at the banking-house there will support an allegation that it was presented there to the maker. Hardy v. Woodroofe, 2 Stark. 319. If a note be payable at two places, presentment at either is sufficient, Beeching v. Gower, Holt, N. P. 313. Notice of dishonour to the maker is unnecessary, for he is in the position of the acceptor of a bill. Sect. 89 (2), ante, p. 401.

There are days of grace in the case of a promissory note; see sect. 89 (1), ante, p. 401, and sect. 14 (1), ante, p. 350. So, in respect of each instalment where the note is payable by instalments, even where upon default in payment of any instalment the whole shall become due. See sect. 83 (1), ante, p. 400, and sect. 9 (1), (c), ante, p. 342. This follows the old law. Oridge v. Sherborne, 11 M. & W. 374; Carlon v. Kenealy, 12 M. & W. 139; Miller v. Biddle, 14 W. R. 110, Mich. T. 1865, Exch.

Evidence under money claims.] A promissory note is evidence on the money claims only between immediate parties. Waynam v. Bend, 1 Camp. 175. It is evidence of money lent by the payee to the maker. Bayley on Bills, 6th ed., 362. A promissory note dated August, 1844, purporting to be for the amount of interest due on another note for 1177. down to 6th July, 1844, is evidence of an account stated in August, 1844, of a then subsisting debt of 1177. Perry v. Slade, 8 Q. B. 115. Where a note cannot be given in evidence for want of a proper stamp, the plaintiff may recover on the consideration of the note. Farr v. Price, 1 East, 58, and Id., n. And, the note may be used as evidence of the terms of a loan of money, though avoided by an alteration without a fresh stamp. Sutton v. Toomer, 7 B. & C. 416.

The plaintiff cannot resort to the money counts if the note have been lost, ante, p. 346. Nor, can he resort to them where he has made a note his own by laches, for this operates as payment. Camidge v. Allenby, 6. B. & C. 373. See Smith v. Mercer, L. R., 3 Ex. 51; Hopkins v. Ware, L. R., 4 Ex. 268. A special defence may be necessary in both cases.

Indorsee against Maker.

In an action on a promissory note by an indorsee against the maker, the plaintiff will have to prove, in addition to the making of the note by the defendant, the indorsement stated in the statement of claim, if traversed.

It has been already stated, ante, pp. 360 et seq., in what manner an indorsement may be proved, and what indorsements are to be proved.