name

35

wrong.

20. Two directors and the secretary of "The Bastille Syndicate, Limited," accepted a bill in the name of "The old Paris and Bastille Syndicate, Limited." The company did not pay the bill, and the directors and secretary were held personally liable under section 42 of the Companies' Act: Nassau Press v. Tyler, 70 L. T. N. S. 376 (1894).

Drawee's 2. Where in a bill the drawee is wrongly designated or his name is misspelt, he may accept the bill as therein described, adding, if he thinks fit, his proper signature, or he may accept by his proper signature. 53 V., c. 33, s. 17.

Accept

ance.

On the bill.

For

money.

Mere

signature.

This sub-section is not in the Imperial Act, but the same principle as to a payee or endorsee is found in sec. 32 (2) of that Act (sec. 64 of this Act), and it is in harmony with commercial usage. It was inserted in the bill at a suggestion of the Toronto bankers: Commons Debates, 1890, p. 109. When sec. 32 of the bill of 1890 was under consideration in the Senate a member of that body suggested that the words "if he thinks fit" should be omitted, on the ground that if a man adopted a wrongful designation or name that was not his own, he should be compelled to dɔ so over his proper signature. The suggestion was adoptel, and the words struck out: Senate Debates, 1890, p. 572. It was apparently not observed that a like expression was used in this section. We have consequently the anomaly that it is optional with a drawee to add his proper signature, but compulsory on a payee or endorsee.

36. An acceptance is invalid unless it complies with the following conditions, namely:

(a) It must be written on the bill and be signed by the drawee;

(b) It must not express that the drawee will perform his promise by any other means than the payment of money.

2. The mere signature of the drawee written on the bill without additional words is a sufficient acceptance. 53 V., c. 33, s. 17 (2). Imp. Act, ibid.

(a) "According to the law merchant, an acceptance § 36 may be (1) expressed in words, or (2) implied from the conduct of the drawee. (3) It may be verbal or written. (4) It may be in writing on the bill itself or on a separate paper. (5) It may be before the bill is drawn or afterwards. Acceptance by telegram has been held sufficient:" Daniel, § 496. In nearly all countries these provisions have been restricted by statute.

It was held in England that the statute 3 & 4 Anne, c. In writing. 9, which was intended to require a written acceptance of inland bills, had not that effect: Wilkinson v. Lutwidge, 1 Str. 648 (1726); Lumley v. Palmer, 2 Str. 1000 (1735); Pillans v. Van Mierop, 3 Burr. 1663 (1765). The Act 1 & 2 Geo. IV. c. 78, was passed to make a written acceptance necessary in such cases, and the Mercantile Amendment Act, 1856, 19 & 20 Vict. c. 97, s. 6, required an acceptance on any bill, foreign or inland, to be in writing and signed by the drawee. It was held in Hindhaugh v. Blakey, 3 C. P. D. Accept136 (1878), that the signature alone of the acceptor was not sufficient, and the Bills of Exchange Act, 1878, 41 & 42 Vict. c. 13, was passed to declare the mere signature sufficient.

In Lower Canada a parol acceptance was formerly held to be sufficient: Lagueux v. Everett, 1 Rev. de Lég. 510 (1817); Jones v. Goudie, 2 Rev. de Lég. 334 (1820). The Act of 1849 required an acceptance to be in writing on the bill, and this was subsequently embodied in the Civil Code, Art. 2292. The same law was introduced into Upper Canada by 7 Wm. IV. c. 5; into Nova Scotia by 28 Vict. c. 10; into New Brunswick by 6 Wm. IV. c. 49; and into Prince Edward Island by 27 Vict. c. 6.

These various provisions were consolidated and made. applicable to the whole Dominion in section 4 of chapter 123 of R. S. C. (1886). It is in effect reproduced in the first part of the above clause, which says, " It must be written on the bill." As to what is a writing, and what is recognized as a signature, see notes on section 17 ante pp. 52 and 53.

ance.

The acceptance and signature of the drawee are usually Where on written across the face of the bill; but its direction and posi- bills. tion are immaterial, provided it appear that it was meant to be an acceptance. It may be below the drawee's name or

$36

Source of

law.

Must pay

in money.

above it, and parallel to it, or it may be even on the back of the bill: Young v. Glover, 3 Jur. N. S. 637 (1857); 1 Daniel, $498.

The whole clause is copied from section 17 of the Imperial Act, the latter part, relating to the signature of the drawee, having been taken from the Mercantile Amendment Act, 1856, and the Bills of Exchange Act, 1878, as stated above. These statutes were not in force in any part of Canada, except the Act of 1856, in Manitoba, British Columbia, and the North-West Territories, having been introduced there as part of the law of England, as mentioned in the introduction. However, the various provincial statutes above mentioned were very similar to the Imperial Act, 1 & 2 Geo. IV. c. 78, and it was held in England that the signature alone of the drawee on the bill was a sufficient acceptance: Leslie v. Hastings, 1 M & Rob. 119 (1831).

In New Brunswick, under the Act requiring an acceptance to be in writing, a bill was drawn upon a bank payable in three instalments. When the first instalment became due, the cashier paid it, and indorsed on the bill, "Paid on the within $741, Aug. 12, 1861." This was held to be an acceptance for the remaining instalments: Berton v. Central Bank, 10 N. B. (5 Allen), 493 (1863). This would not be an acceptance under the present Act for want of a signature.

In some of the United States the old common law rule of verbal acceptance still prevails. The Negotiable Instruments Law requires it to be in writing and signed by the drawee: 220.

(b) A bill may be varied in certain respects by the ucceptance: sec. 38. But the drawee does not become an acceptor if he proposes to satisfy the bill in anything except money. This was the old law. As to what is money, see notes on section 17, ante p. 51.

An acceptance to pay by another bill is not an acceptance: Russell v. Phillips, 14 Q. B. 891 (1850).

A Promise to Accept is not an acceptance. The drawee who gives such a promise may be held liable on his contract by estoppel, but not as an acceptor. So if what would formerly have been acceptance is written elsewhere than on the

accept.

bill: See Bank of Montreal v. Thomas, 16 O. R. 503 (1888); § 36 Torrance v. Bank of British North America, 17 L. C. J. 185; L. R. 5 P. C. 247 (1873); Dunspaugh v. Molsons Bank, 23 Promise to L. C. J. 57 (1878); Maritime Bank v. Union Bank, M. L. R. 4 S. C. 244 (1888); Coolidge v. Payson, 2 Wheaton, 66 (1817); Ilsley v. Jones, 12 Gray, 260 (1858); Riggs v. Lindsay, 7 Cranch (U.S.) 500 (1813).

A verbal promise to accept was insufficient under the old law, when a verbal acceptance was binding: Johnson v. Collings, 1 East, 98 (1800); Bank of Ireland v. Archer, 11 M. & W. 383 (1843); Kennedy v. Geddes, 8 Porter (Ala.) 268 (1839).

Accept

ance.

(a) before it has been signed by the drawer, or Before while otherwise incomplete;

completion.

(b) when it is overdue, or after it has been dis- Overdue. honoured by a previous refusal to accept, or by non-payment. 53 V., c. 33, s. 18 (1). Imp. Act, s. 18 (1), (2).

(a) The acceptance may be upon a blank paper, and if delivered to be filled up as a bill it is binding, and any other material particular in respect to which the bill may be incomplete, the person in possession has a prima facie authority to supply in any way he thinks fit: sec. 31. By sec. 186 this is one of the sections not applicable to a promissory note. The signing of an incomplete note by the maker is however covered by the rule laid down in section 32, which does apply to promissory notes.

For illustrations of the foregoing see the notes to section 31.

(b) A bill accepted when overdue is payable on demand: sec. 23 (2). After a bill has been refused acceptance, and notice of dishonor has been given, the holder may apply to the referee in case of need if there be one named in the bill: sec. 33; or it may be accepted for honor by a third person: sec. 147; or the drawee himself may change his mind and accept: Wynne v. Raikes, 5 East, 514 (1804).

§ 37

ance after

If he should do so, the date from which time should run is fixed by the next sub-section.

A bill is presumed to have been accepted shortly after its issue and before maturity, unless something appears or is shewn to the contrary.

Accept- 2. When a bill payable at sight or after sight is dishonour. dishonoured by non-acceptance, and the drawee subsequently accepts it, the holder, in the absence of any different agreement, is entitled to have the bill accepted as of the date of first presentment to the drawee for acceptance. 53 V., c. 33, s. 18; 54-55 V., c. 17, s. 3. Imp. Act, s. 18 (3).

This sub-section in the Act of 1890 was copied verbatim from the Imperial Act, which does not contain the words "at sight or" in the first line. It was another instance of the omission of the change necessary to make the Act consistent with the decision to continue to allow days of grace on sight bills. These words were added by the amending Act of 1891, thus putting all bills payable at a certain time after acceptance on the same footing.

It introduced new law, and was designed to place all parties in the same position as if the bill had been accepted when first presented: sec. 80; or as if accepted by a referce in case of need or by an acceptor for honor: sec. 94. The date of the first presentment, notwithstanding the words of the Act, will probably be held to be fixed by the date of the protest for non-acceptance, which may be two days later than the actual first presentment: sec. 80.

The words of the sub-section are ambiguous; but it is likely that they will be held not to be sufficiently strong to place a drawee in a worse position than he would be under sub-section 4 of section 80.

If the holder took an acceptance of a later date, it would be a qualified acceptance and he would do so at his own risk: sec. 84.