Mineral leases appear to be in the same situation.1 Formal warning is not necessary in leases of feu-duties, port-customs, and grass parks. In the last case intimation seems to be unnecessary.2 1 Hunter, 1188.—2 Ibid. 90, 91. PART XI. BILLS OF EXCHANGE CHAPTER I. Form, Nature, and Requisites. SECT. 1.-Description and Definitions. BILLS of Exchange and Promissory Notes are applied to numerous and very important commercial services. They constitute securities for debt, are the instruments of transferring money from place to place, or of shifting an obligation from one person to another; they are often used by merchants as cautionary obligations, and are still more frequently the means by which one man of business assists another with his direct credit. A great part of the usual currency of the kingdom is in the shape of bankers' promissory notes; and in Scotland by far the greater portion of the money which passes from hand to hand in sums of pounds sterling, is in that shape. A Bill of Exchange is a precept or mandate addressed by one person to another, directing him to pay to the person who makes the demand, or some other person named, or to the bearer, a sum of money, at sight, or on demand, or at a fixed time. A Promissory Note is an obligation in similar terms, simply promising to pay, without a preparatory mandate. Parties. In a bill of exchange the person who signs the mandate is called the Drawer, he to whom it is addressed is called the Drawee, the person to whom the sum of money is to be given is called the Payee,-the drawer may of course be payee. When the drawee signs the bill, acknowledging his liability for the contents, he is said to accept it, and from that period the term Acceptor is applicable to him. In a promissory note the two parties are termed Maker or Granter, and Payee. Whoever stands for the time entitled to receive payment of a bill or note is termed the Payee, Holder, or Porteur. A bill of exchange is not a complete negotiable document until it is signed by the acceptor; though it may, as hereafter will be seen, support a claim against the drawer without being so. A promissory note is complete from the moment of its being signed by the maker. Inland and Foreign.-Bills of exchange are either Inland or Foreign. They are the former when the Drawer and Drawee are in the same country-the latter when they are in different countries. In England the distinction is of more importance than in Scotland, inland bills being there held not to require protest. (See below, p. 319.) In Scotland there is a difference between the two sorts of bills, as to the time within which notice of dishonour should be given (p. 320), and to this end bills between England and Scotland are held to be foreign. Bills between Great Britain and foreign countries are generally drawn in sets of two or more, each being a repetition of the others, with the exception of a number to distinguish it. By this expedient, if one is lost in the passage, another may be made use of, and to this end each bill bears to be payable only on condition of no other of the same tenor and date having been paid. Foreign bills are frequently made payable at "usance," a period, the length of which, as between any two places, depends on commercial usage. Checks or Drafts on Bankers bear a considerable internal resemblance to bills of exchange. The two kinds of document differ from each other in this, that the draft is merely a direction to the banker to pay the money deposited with him; the bill is an order to a debtor or presumed debtor to pay the money which he owes or may acknowledge himself to owe to the drawer. The chief practical distinctions between them will be considered under the head of stamps, p. 308. Bills, notes, and drafts are transferable, so as to enable a payee to put any other person in his place. In England, to enable this to be accomplished where the payee is named, there must be negotiable words on the face of the bill, such as "or order," "or bearer;" but in Scotland, special words 1 Ch. on B. 196, 197. are required to restrict the transferability. A bill or note payable "to bearer," or with the payee's name blank, or with his name followed by the words or bearer," may be transferred by mere delivery. If payable to a person named, with or without the words " or order," they may be transferred by indorsation. If blank indorsed, they are transferable by delivery. There is considerable difference, however, between the rights carried by indorsement and those transferred by mere delivery. (See below, p. 324.) Bank notes are generally transferred from hand to hand as cash. They are not, however, a legal tender-that is to say, a creditor for a sum in cash is not bound to receive the notes of any bank in satisfaction of his debt. Formerly the notes of the bank of England were a legal tender in Scotland, but they are not so now.2 SECT. 2.-Form. Bills and notes require no particular form, but it is by no means safe to depart from the usual arrangement of words which custom has prescribed. A bill must contain a distinct mandate, and a note a distinct promise to pay money; the person who is to pay and the sum to be paid must be distinctly told, and the time of payment must either be stated, or ascertainable beyond a doubt from the terms of the bill. A request to pay money is not a bill, for the law presumes the drawer to be the creditor of the acceptor, and the bill to be an absolute mandate to pay.3 The interposition of a condition, or a bargain, will deprive the document of the privileges of a bill. It is of great moment to its efficacy that. the bill should be a clear correct written document, free of blanks, interlineations, or erasures. Sometimes the document may be rendered utterly ineffective by alterations in important parts. The most essential element is the sum, and the effect of any vitiation on this part will be further considered. In the mean time it may be observed that defects not sufficient utterly to invalidate the document may yet interrupt the summary method of execution applicable to bills. It seems to be held that an erasure or alteration, if not in material parts-such as the sum, or the parties, will only interrupt summary diligence, until there be an inquiry whether the alteration was made with the consent of parties.5 1 Th. 85.- 8 & 9 Vict. c. 38, § 15.- Bayley, 6.4 Ch. 132.- Armstrong v. Wilson, 2d June 1842. The following are the ordinary forms of bills and notes. It has to be observed that, in the bills the letters A B represent the signature of the drawer, those below them, viz. Ĉ D, that of the acceptor, whose address is at the other end of the document. In the note the letters C D represent the signature of the maker. £150 Form of an Ordinary Bill. Edinburgh, Nov. 20, 1839. Three months after date, pay to me or order,† at the Banking House of The British Linen Company in Edinburgh, the sum of one hundred and fifty pounds sterling, value received. To Mr C. D. merchant, No. High Street, Edinburgh. A B C D * Or, so long after sight, or at sight, or on demand, or on such a day of such a month, as the case may be. + Or, to X Y, or order, or to bearer. Form of a Bill on France. Exchange for 10,000 Livres Tournoises. Edinburgh, Nov. 20, 1839. At two usances,* pay this my first bill of exchange (second and third of the same tenor and date not being paid), to Messrs X Y or order, Ten thousand livres tournoises, value received of them; and place the same to account as per advice from A Monsieur C D Paris. A B C D *Or, so long after sight, or so long after date, or on demand. + Or, to bearer. Or, with or without farther advice. Form of a Promissory Note. £150 Edinburgh, Nov. 20, 1838. Three months after date I promise to pay to A B or order £150 sterling, for value received. C D *** The same variations which are applicable to bills of exchange apply. |