DISHONOR OF A BILL. When the drawee, or person on whom a bill is drawn, declines to accept it or to pay it, he is said to dishonor it. The act of drawing or of indorsing a bill implies an obligation to pay it in the last instance, and the person in whose favor it is drawn has thus recourse against the drawer and indorsers, should the drawee fail to accept or to pay. In order to preserve thiS recourse. however, it is indis pensable that notice of dishonor shall be given to the drawer and indorsers. No parti cular form of notice Is requisite. The notice must be such as to identify the bill, and to inform the party to whom it is given of the protest, a copy of which ought to accom pany it. If the notice is put into the post-office, and properly addressed, it is sufficient; and even verbal notice, if clear, will suffice. In the case of foreign bills, the period within which notice must be given is regulated by the usages and customs of merchants.
Any delay which can fairly be ascribed to neglect or omission, and is not justified by the circumstances of the case, will be fatal to the bill-holder's claim for recourse. In inland bills and notes, the rule till lately in Scotland was, that fourteen days after the protest was taken should be allowed. This has been altered by the mercantile law amendment act (19 and 20 Viet. c. 60), which provides (s. 14) that notice of dis honor of inland bills and promissory-notes, in order to entitle the holder to recourse, shall be given "in the same manner and within the same time as is required in the case of foreign bills by the law of Scotland." To both classes of bills, then, the English rule is now applicable, which is, that notice must, in the general case, be sent the next day, where the parties reside in the same place, and by the next post, if they reside at a distance.