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bill, section and exchange

INDORSER. When a payee writes his name upon the back of a bill or cheque, he is called an " indorser," and when the instru ment is negotiated to other persons, each person may indorse it in turn and become an indorser. Each indorser of a bill (or cheque) is liable thereon.

Any indorser, however, may add after his signature such words as " without recourse to me," or "sans recours." The sanction is given by Section 16 of the Bills of Exchange Act, 1882, which provides that any indorser may insert an express stipulation : " (1) Negativing or limiting his own lia bility to the holder ; " (2) Waiving as regards himself some or all of the holder's duties." The liability of an indorser is defined by the Bills of Exchange Act, Section 55 : " (2) The indorser of a bill by indorsing it " (a) Engages that on due pre sentment it shall be accepted and paid according to its tenor, and that if it be dis honoured he will compen sate the holder or a subse quent indorser who is com pelled to pay it, provided that the requisite proceed ings on dishonour be duly taken ; " (b) Is precluded from denying to a holder in due course the genuineness and regularity in all respects of the drawer's signature and all previous indorsements ; " (c) Is precluded from denying to his immediate or a subse quent indorsee that the bill was at the time of his in dorsement a valid and sub sisting bill, and that he had then a good title thereto."

Section 56 provides : " Where a person signs a bill otherwise than as drawer or acceptor, he thereby incurs the liabilities of an indorser to a holder in due course." Where a person is under obligation to indorse a bill in a representative capacity as treasurer or executor, he may indorse the bill in such terms as to negative personal liability (Section 31, s.s. 5).

Where an indorser is dead and the party giving notice knows it, notice of dishonour must be given to his personal representative if such there be, and with the exercise of reasonable diligence he can be found (Section 49, s.s. 9).

Where an indorser is bankrupt, notice may be given either to the party himself or to the trustee (Section 49, s.s. 10). (See BILL OF EXCHANGE, DISHONOUR OF BILL OF EXCHANGE, INDORSEMENT, NEGOTIATION OF BILL OF EXCHANGE.)