66

3. A promise to pay to W. & D., stewardesses for the time being of the P. D. Society, or their successors in office," held to be a promissory note: Rex v. Box, 6 Taunt. 325 (1815).

4. A promise to pay "to the trustees acting under the will of the late W.," held to be a promissory note: Megginson v. Harper, 2 C. & M. 322 (1834).

5. A promise to pay the secretary or treasurer for the time being of a society is not a note: Cowie v. Stirling, 6 E. & B. 333 (1856).

6. A promise to pay "to the trustees of the Wesleyan Chapel, Harrogate, or their treasurer for the time being," is a good note: Holmes v. Jaques, L. R. 1 Q. B. 376 (1866). See Auldjo v. McDougall, 3 U. C. O. S. 199 (1883).

7. A note payable to the order of "A. B., trustee for C. D.." is a good promissory note: Downer v. Read, 17 Minn. 493 (1871).

§ 19

to be

20. The drawee must be named or otherwise in- Drawee dicated in a bill with reasonable certainty. 53 V., named. c. 33, s. 6. Imp. Act, ibid.

The name and address of the drawee, preceded by the word "To," are usually placed at the lower left-hand corner of a bill, but they may be placed on any part of it provided it be clear to whom the bill is meant to be addressed. The certainty is required in order that the payee may know upon whom he is to call to accept and pay the bill; and in order that the drawee may know whether he would be justified in accepting and paying the bill on account of the drawer. At common law the name of the drawee is not necessary, if he be otherwise sufficiently indicated. Blanks may be filled up in accordance with the provisions of section 31,-even after acceptance: sec. 37 (a). If the drawee be a fictitious person, see section 26.

ILLUSTRATIONS.

1. An instrument not addressed to any drawer is not a bill of exchange: Forward v. Thompson, 12 U. C. Q. B. 103 (1854); McPherson v. Johnston, 3 B. C. R. 465 (1894); Peto v. Reynolds, 9 Ex. 410 (1854); 11 Ex. 418 (1855).

2. Where the word "At" is placed before the name of the drawee instead of "To," it is sufficient: Shuttleworth v. Stephens, 1 Camp. 407 (1808).

3. Where the words "payable at No. 1 Wilmot Street, London," appeared on a bill in the place where the name of the drawee is usu

$ 20

Drawee named.

Transfer words.

ally written, and it was accepted by defendant, who lived there, held sufficient, and M. liable as acceptor: Gray v. Milner, 8 Taunt. 739 (1819).

4. A bill addressed "To the agent and owners of a certain ship without naming them, is a sufficient indication of the drawee: Taber v. Cannon, 8 Metc. 456 (1844).

5. Where an instrument not addressed to any person, is ac cepted, such party is not liable as an acceptor, but may be as the maker of a note: Fielder v. Marshall, 9 C. B. N. S. 606 (1861).

6. A bill addressed "To the Steamer Dorrance and owners" is a sufficient designation: Alabama Coal Co. v. Brainard, 35 Ala. 476 (1860).

21. When a bill contains words prohibiting transfer, or indicating an intention that it should not be transferable, it is valid as between the parties thereto, but it is not negotiable. 53 V., c. 33, s. 8 (1). Imp. Act, ibid.

Before the Act of 1890 if a party to a bill wished to make it not negotiable, all he had to do was to make it payable to a person named, omitting "order" or "bearer." Now such a note is negotiable: sec. 22; and if he wishes to make it not negotiable he must do so in clear terms. Where a bill was drawn payable to the order of F. the drawer, and the drawees struck out the word "order" and accepted the bill "in favor of F. only," at a certain bank, it was held that such acceptance was not a qualified one, and did not vary the effect of the bill as drawn: Meyer v. Decroix, [1891] A. C. 520. Where a cheque payable to the order of M. was crossed "account of M., National Bank Dublin," was held that these words in the crossing did not prohibit transfer, and that the bank having credited M. with the amount, could sue the drawer: National Bank v. Silke, [1891] 1 Q. B. 435. For the rule as to bills negotiable in their origin, but which have their negotiability either stopped or limited by a restrictive indorsement, see section 68. The words "non-negotiable and given as security" written on the face of a note deprives it of its essential characteristic as a promissory note, and it becomes a mere contract of suretyship: Davis v. Robertson, Q. R. 6 Q. B. 264 (1897).

The Old Law. Formerly a bill payable to a particular $ 21 person and not to his order or to bearer would have co.ne under this sub-section, and most of the non-negotiable bills and notes in the reported cases are of this class; now, by section 22, such a bill is negotiable. It remains to be seen whether the Courts will recognize in third parties the same rights under a sale or assignment of a bill or note whose transfer is prohibited, as they have heretofore done as to a bill not payable to order or bearer. As to the law in England, Chalmers says, at p. 131: "A bill may be transferred by assignment or sale, subject to the same conditions as would be requisite in the case of an ordinary chose in action. Thus:-C. is the holder of a note payable to his order. He may transfer his title to D. by a separate writing assigning the note to D.: Re Barrington, 2 Scho. & Lef. 112 (1804); or by a voluntary deed constituting a declaration of trust in favor of D.: Richardson v. Richardson, L. R. 3 Eq 686 (1867), as explained in Warriner v. Rogers, L. R. 16 Eq. 340 (1873), or by a written contract of sale: Sheldon v. Parker, 3 Hun (N.Y.) 498 (1875). A bill is a chattel, therefore it may be sold as a chattel. A bill is a chose in action, therefore it may be assigned as a chose in action."

action.

Chose in Action.-In Ontario, the Judicature Act, R. S. Chose in O. c. 51, s. 58, s.-s. 5, provides for the transfer of a debt or chose in action by an assignment in writing, and gives the assignee, after express notice of the assignment, the right to sue for or give a good discharge for the same without the concurrence of the assignor. R. S. N. S. c. 155, s. 19 (5); C. S. N. B. c. 111, s. 155; R. S. Man. c. 40, s. 39 (e); R S. B. C. c. 56, s. 16, s.-s. 17; Stat. Alta., 1907, c. 5, s. 7 (3); and Cons. Ord. N. W. T. c. 41, s. 1, contain similar provisions.

The law of Quebec is contained in Articles 1570 and 1571 of the Civil Code, and provides that the sale of debts and rights of action is effected by an instrument of sale, a copy of which is served on the debtor unless he is a party to it. The transferee may then sue in his own name. The institution of an action against the debtor is a sufficient service of transfer of the debt: Bank of Toronto v. St. Lawrence M'L.B E.A.-5

$ 21

Chose in action.

Fire Ins. Co., [1903] A.C. 59. Article 1573 provides that these provisions do not apply to bills, notes or cheques payable to order or bearer. In McCorkill v. Barrabé, M. L. R. 1 S. C. 319 (1885), it was held that the indorsee of a nonnegotiable note could sue the maker, when a copy of the note and indorsement had been served upon the latter.

In Brice v. Bannister, 3 Q. B. D. 569 (1878), Bramwell, L.J., in speaking of an assignment of money to be earned under a written contract, says at p. 580: "It does seem tɔ me a strange thing and hard on a man that he should enter into a contract with another and then find that because that other has entered into some contract with a third, he, the first man, is unable to do that which is reasonable and just he should do for his own good. But the law seems to be so; and any one who enters into a contract with A. must do so with the understanding that B. may be the person with whom he will have to reckon. Whether this can be avoided, I know not; may be, if in the contract with A. it was expressly stipulated that an assignment to B. should give no rights to him such a stipulation would be binding. I hope it would be."

This section of the Act appears to furnish the stipulation suggested by Lord Bramwell, and as the law of Quebec makes provision for transfer the question proposed by him may come up for solution there. If there be a conflict between the Act and the Code there may be still further an important question as to which law shall override the other.

In Quebec it has been held that the indorsee of a nonnegotiable note could sue his immediate indorser but not a more remote party: Jones v. Whitty, 9 L. C. R. 191 (1859). See Bard v. Francoeur, Q. R. 7 S. C. 315 (1894).

In Harvey v. The Bank of Hamilton, 16 S. C. Can. 714 (1888), an Ontario case, it was held that although the note was not negotiable the indorsee was entitled to recover from the maker, it being shown that the note was intended by the makers to have been made negotiable, and was issued by then as such, but, by mistake or inadvertence, it was not expressed to be payable to the order of the payee. But in this case might not the holder have added the words "or order" having been omitted by inadvertence? In Kershaw v. Cos,

3 Esp. 246 (1800), it was held that the insertion of these $ 21 words did not vitiate the note.

Chose in

It has been held that the indorser of a non-negotiable action. note is not liable to the payee: West v. Brown, 3 U. C. Q. B. 290 (1846); and that the maker of a non-negotiable note payable to the treasurer of a township cannot be sued by the corporation: Township of Toronto v. McBride, 29 U. C. Q. B. 13 (1869).

The French Code de Commerce does not recognize a nonnegotiable instrument as a bill of exchange: Arts. 110, 136.

2. A negotiable bill may be payable either to Negotiable order or to bearer.

bill.

payable to

3. A bill is payable to bearer which is expressed When to be so payable, or on which the only or last en- bearer. dorsement is an endorsement in blank. 33, s. 8 (2) and (3). Imp. Act, ibid.

Section 22 defines a bill payable to order.

53 V., c.

A bill is expressed to be payable to bearer, not only when it is made payable to "bearer" simply, but also when made payable" to A. B. or bearer," or "to or bearer." Where a bill is negotiable in its origin, it continues to be negotiable until it has been restrictively endorsed or discharged by payment or otherwise: sec. 69.

The last clause of this sub-section altered the law in England, and it also alters the law in Canada. Formerly a bill having been indorsed in blank, its negotiability could not afterwards be restrained by a special indorsement: Walker v. Macdonald, 2 Ex. 527 (1848). No indorsement other than that by a payee can stop the negotiability of the bill: Civil Code, Quebec, Art. 2288. A cheque payable to C. M. & S. or bearer was stamped for deposit to their credit in a bank and indorsed by them. Their clerk instead of depositing it drew the funds, the teller not observing the special indorsement. It was held that as bearer the clerk was entitled to receive payment and the bank which paid was not liable: Exchange Bank v. Quebec Bank, M. L. R. 6 S. C. 10 (1890).