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Bill of Exchange

person, payable, note, bearer, holder, inland and value

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BILL OF EXCHANGE. The law relating to bills of exchange has been summed up in, and codified by, the Bills of Exchange Act, 1882, for Scotland as well as the other parts of the United Kingdom. As the subject is somewhat technical, attention should be paid to the following interpreta tion of terms. So far as the context allows, the word "acceptance" will mean an acceptance completed by delivery or notification ; " action " will include counter-claim and set-off; "banker," a body of persons, whether incorporated or not, who carry on the business of banking; " bankrupt," any person whose estate is vested in a trustee or assignee under the law for the time being in force relating to bankruptcy ; " bearer" will mean the person in possession of a bill or note which is payable to bearer ; " a bill of exchange, and " note," a promissory note ; " delivery," transfer of possession, actual or constructive, from one person to another ; "holder," the payee or endorsee of a bill or note who is in possession of it, or the bearer thereof; " endorsement," an endorsement completed by delivery ; " issue," the first delivery of a bill or note, complete in a person who takes it as a holder ; " value," a valuable consideration ; and " person" will include a body of persons whether incorporated or not.

Form and Interpretation—Definitions.—A bill of exchange is an un conditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed 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. Any other form of instru ment is not a bill ; nor is an order to pay out of a particular fund. But it would be a bill where there is an unqualified order to pay, coupled with (a) an indication of a particular fund out of which the drawee is to reimburse himself or a particular account to be debited with the amount, or (b) a state ment of the transaction which gave rise to the bill. A bill is not invalid because it is undated ; or does not specify the value given, or that any value has been given therefor ; or does not specify the place where it is drawn or payable.

Inland and Foreign Bills.—An inland bill is one which is, or purports to be, either both drawn and payable within the British Islands, or drawn within the British Islands upon some person resident therein. Any other bill is a

foreign bill. Unless the contrary appears on the face of the bill, the holder may treat it as an inland bill. Ile Islands of Man, Guernsey, Jersey, Sark, and those a ljacent to any of them, are within the British Islands for this purpose. The following is the usual form of an inland bill, with the accept,. ance written across its face : £100 • 0 : 0. Due: 4th May 19—. 503 CHEAPSIDE, LONDON, 1st February 19—.

Three months after date pay to me (or to some third party, E. F.), or order, the sum of one hundred pounds, value received.

(Signed) A. B. (the drawer).

To C. D. (the acceptor), 414 High Street, Bath.

The following is the usual form of a foreign bill, which differs from an inland bill in that, to provide against risk in transmission, it is usually drawn in sets, each bill being transmitted by a different conveyance : £100 sterling. First 1st February 19—.

At sixty days after sight of this our first of exchange (second and third of same tenor and date being unpaid) pay to our order (or to C. D., or order) the sum of one hundred pounds sterling, for value as advised by To C. D. (Signed) A. B.

Parties to bill.—A bill may be drawn payable to, or to the order of, the drawer or the drawee. Where in a bill the drawer and drawee are the same person, or where the drawee is a fictitious person or one not having capacity to contract, the holder may treat the instrument, at his option, either as a bill or a promissory note. The drawee must be named or otherwise in a bill with reasonable certainty ; and a bill may be addressed to two or more drawees whether partners or not; but an order addressed to two drawees in the alterna tive, or to two or more drawees in succession, would not be a bill of exchange. So where a bill is not payable to bearer, the payee must be named or indicated with reasonable certainty. A bill may be made payable to two or more payees jointly, or be made payable in the alternative to one of two, or one of some of several payees. It may also be made payable to the holder of an office for the time being ; but if the payee is a fictitious or non-existing person, the bill may be treated as payable to bearer.

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