BILL OF EXCHANGE. An unconditional 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. Such is now the statutory definition in Great Britain. in more than forty of her colonies, and in about twenty jurisdictions I if the States. An inland or domestic hill is One which purports to be drawn and payable within a partieular State. A foreign bill Is one drawn in one State upon a person in another. For this purpose, our States and Territories are deemed foreign to each other. While no set form of words is required to constitute a bill of exchange, au inland bill is ordinarily in the following form: Bills of exchange are of comparatively modern origin, having been used by the Florentines in the Twelfth, by the Venetians in the Thirteenth, and introduced into England during the latter part of the Fourteenth Century. They were used in England but little until the Seventeenth Cen tury, the first reported ease in the courts of that country occurring in 1603. Originally, a bill of exchange was employed to avoid sending money from one country to another. If a London mer chant. A, owed a debt in Amsterdam, he went to B in London, to whom money was owing from in Amsterdam, paid to B the amount of the debt and received from him a bill of exchange on directing him to pay that amount to A's creditor in Amsterdam, D, and charge the same to the drawer's account. Thus the London merchant, A, would pay his Amsterdam creditor, D, with out sending any money out of the country. It trill be noticed that a bill of exchange repre sented a trade transaction, was drawn by a creditor on his debtor, and for money paid to the drawer by the payee or by the payee's debtor. Such is still the character of a bill in Franey, where the nature of the value for which it is given must be expressed. and a false statement on this point avoids the instrument in the hands of any holder with notice. In Great Britain and the Vnited States, on the other hand, a hill of exchange need not represent a trade transaction, and is frequently issued as a mere instrument of credit. The acceptor, the drawer. or an indorser may put his name on the bill, not because he has received the value named therein. but simply for
the accommodation of some other party; that is, for the purpose of lending his credit to such accommodated party. In other words, bills of exchange have come to perform the functions of a paper currency.
The liability of the various parties to a bill may be stated briefly as follows: The drawee is under no obligation on a bill until he accepts it; that is. until he formally assents to the order of the drawer. An oral acceptance was held valid at common law, and this role obtains in sonic of our States; but in others, and in great Britain, under the statutes, it must be in writing and signed by the drawee. This statutory require ment is satisfied by the drawee's signature across the face of the bill. The holder of a bill is en titled to insist that the acceptance shall be au unqualified assent to the drawer's order. If it is qualified in any respect, as if the assent is subject to some condition. or is to the payment of a part only of the amount of the bill, the holder may refuse to take it and treat the bill as dishonored. If he does take such a qualified ac ceptance, lie discharges the drawer and indorsers from liability on the bill, unless they assent thereto. By accepting the bill, the drawee (thereafter called the acceptor) engages abso lutely to pay it: and no demand need be made on• him as a condition of suing him thereon. Nor will the fact that he received no considera tion for accepting, the bill be a defense for him against a holder for value, for the latter has been induced to give value for the bill by the acceptor's engagement to pay. It is a good de fense, however, as against any one but a holder for value, or one claiming through such holder; the rule beimg that every negotiable instrument is presumed to have been issued, and every con tract thereon, whether of acceptor, drawer, or made for a valuable consideration; but that this presumption may be rebutted in an action brought by any one who has not paid value for the bill, or has not obtained title through a holder for value. The acceptance of a bill oper ates as a conclusive admission by the acceptor of the genuineness of the drawer's signature, of his capacity and authority to draw the bill, of the existence of the payee, and of his then capac ity to indorse it; but it is not an admission that the body of the bill is genuine, nor that the in dorsement of the payee is genuine.