Bills of Exchange Act 1908

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1. Short Title, etc.
2. Interpretation	55. Liability of drawer or indorser
- Business days and non-business days	56. Stranger signing bill liable as indorser
	57. Measure of damages against parties to dishonoured bill
PART I	58. Transferor and transferee by delivery
BILLS OF EXCHANGE
	Discharge Of Bill
Forms and Interpretation	59. Payment in due course
3. "Bill of Exchange" defined	60. Banker paying on demand draft bearing forged indorsement
4. Inland and foreign bills	61. Where acceptor the holder at maturity
5. How bills may be drawn	62.Holder may waive his right
6. Address to drawee	63. Cancellation
7. Certainty required at to payee	64. Alteration of bill
8. What bills are negotiable
9. Sum payable	Acceptance and Payment for Honour
10. Bill payable on demand	65. Acceptance for honour supra protest
11. Bill payable at a future time	66. Liability of acceptor for honour
12. Omission of date in bill payable after date	67. Presentation to acceptor :or honour
13. Antedating and postdating	68. Payment for honour supra protest
14. Computation of time of payment
15. Referee in case of need	Lost Bills
16. Optional stipulations by drawer or indorser	69. Holder's right to duplicate of lost bill
17. Definition and requisites of acceptance	70. Action on lost bill
18. Time for acceptance
19. General and qualified acceptances	Bill in a Set
20. Inchoate instruments	71. Rules as to sets
21. Delivery
	Conflict of Laws
Capacity and Authority of Parties	72. Law governing contracts contained in a bill
22. Capacity of parties
23 Signature essential to liability	PART II
24. Forged or unauthorised signature	CHEQUES ON A BANK
25. Signature by procuration
26. Person signing as agent or representative	73. "Cheque" defined
	74. Presentment of cheques for payment
The Consideration for a Bill	75. Revocation of banker's authority
27. Value, and holder for value
28. Accommodation party	Crossed Cheques
29. Holder in due course	76. General and special crossings defined
30. Presumption of value and good faith	77. Crossing by drawer or after issue
	78. Crossing to be deemed a material part of cheque
Negotiation of Bills	79. Duties of banker as to crossed cheques
31. Negotiation of bill	80. Protection to banker and drawer where cheque is crossed
32. Requisition of a valid indorsement	81. Effect of the words "Not negotiable"
33. Conditional indorsement	82. [Repealed]
34. Indorsement in blank and special indorsement	83. Branch banks deemed independent banks for certain purposes
35. Restrictive indorsement
36. Negotiation of overdue or dishonoured bill	PART III
37. Negotiation of bill to party already liable thereon	PROMISSORY NOTES
38. Rights of the holder
	84. "Promissory note" defined
General Duties of the Holder	85. Delivery necessary
39. When presentment for acceptance is necessary	86. Joint and several notes
40. Time for presenting bill payable after sight	87. Note payable on demand
41. Rules as to presentment for acceptance and excuses for non-presentment	88. Presentment of note for payment 89. Liability of maker
42. Non-acceptance	90. Application of Part I to notes
43. Dishonour by non-acceptance, and its consequences	PART IV
44. Qualified acceptance	MISCELLANEOUS
45. Rules as to presentment for payment
46 Excuses for delay or non-presentment for payment	91. Good faith 92. Signature
47. Dishonour by non-payment	93. Computation of time
48. Notice of dishonour	94. [Repealed]
49. Rules as to notice of dishonour	95. Protest when notary not accessible
50. Excuses for want of notice and delay 51. Noting or protest of bill	96. Bill drawn at sight to be deemed a bill payable on demand
52. Duties of holder as regards drawee or acceptor	97. [Repealed]
	98. Saving
Liabilities of Parties
53. Funds in hands of drawee	Schedules
54. Liability of acceptor

An Act to consolidate certain enactments of the General Assembly relating to bills of exchange

1. Short Title, etc--(1) The Short Title of this Act is the Bills of Exchange Act 1908.

(2) This Act is a consolidation of the enactments mentioned in the First Schedule hereto.

"Banker" includes a body of persons, whether incorporated or not, who carry on the business of banking;

"Bankrupt" includes any person whose estate is vested in a trustee or assignee under the law for the time being in force relating to bankruptcy;

"Delivery" means transfer of possession, actual or constructive, from one person to another;

"Holder" means the payee or indorsee of a bill or note who is in possession of it or the bearer thereof:

"Issue" means the first delivery of a bill or note complete in form, to a person who takes it as a holder;

Business days and non-business days-Section 12 (1) of the Statutes Amendment Act 1946 provides as follows:

"Non-business day" means any Saturday or Sunday or any bank holiday (not being a part holiday) within the meaning of the Banking Act 1908: and includes, in respect of any bank premises, every day on which those premises are not open for business.

3. "Bill of exchange" defined-(1) A bill of exchange is 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 fixture time, a sum certain in money to or to the order of a specified person. or to bearer.

(2) An instrument that does not comply with these conditions, or that orders any act to be done in addition to the payment of money, is not a bill of exchange.

(3) An order to pay out of a particular fund is not unconditional within the meaning of this section: but an unqualified order to pay coupled with (a) an indication of a particular fund out of which the drawee is to reimburse himself or a particular account to be debited with the amount. or (b) a statement of the transaction giving rise to the bill, in unconditional.

(b) It does not specify the value given, or that any value has been given, therefor;

The Act does not define “signed” or "signature" but as to what may be a sufficient signature. see s. 92. A bill may be accepted before signature by the drawer (s. 18).

The drawee (and payee) must be named or indicated with reasonable certainty (ss. 6, 7). As to a bill payable to a fictitious or non-existent person, see ss. 5(2) and 7(3).

As to subs. (4), the date may be filled in at any time (ss. 12, 20); and bill is not invalid by reason only that it is antedated or postdated or dated on a Sunday (s. 13). The alteration of the date is a material alteration (s. 64). Value is presumed but the presumption is rebuttable on the ground of fraud or illegality (s. 30).

4. Inland and foreign bills-(1) An "Inland bill" is a bill that is, or on the face of it purports to be,-

(b) Drawn in any of the Australasian colonies upon some person resident therein. Any other bill is a "foreign bill".

(2) Unless the contrary appears on the face of the bill the holder may treat it as an inland bill.

For the difference between inland and foreign bills in respect of noting and protest, see s.51.

5. How bills may be drawn-(1) A bill may be drawn payable to or to the order of the drawer: or it may be drawn payable to or to the order of the drawee.

(2) Where in a bill drawer and drawee are the same person, or where the drawee is a fictitious person or a person wit having capacity to contract, the holder may treat the instrument at his option, either as a bill of exchange or as a promissory note.

As to a fictitious or non-existing payee, see s.7(3); and as to capacity to contract, see s.22.

6. Address to drawee-(1) The drawee must be named or otherwise indicated in a bill with reasonable certainty.

(2) A bill may be addressed to two or more drawees, whether they are partners or not; but an order addressed to two drawees in the alternative. or to two or more drawees a succession. is not a bill of exchange.

7. Certainty required as to payee-(1) Where a bill is not payable to bearer, the payee must be named or otherwise indicated therein with reasonable certainty.

(3) Where the payee is a fictitious or non-existing person the bill may be treated as payable to bearer.

As to the indorsement of a hill where a payee is wrongly designated or his name misspelt, see s.32(d).

8. What bills are negotiable--(1) Where a bill contains words prohibiting transfer, or indicating an intention that it is not transferable, it is valid as between the parties thereto, but is not negotiable.

(3) A bill is payable to bearer if it is expressed to be so payable or if the only or the last indorsement thereon is an indorsement in blank.

(4) A bill is payable to order if it is expressed to be so payable or if it is expressed to be payable to a particular person and does not contain words prohibiting transfer or indicating an intention that it is not transferable.

(5) Where a bill either originally or by indorsement is expressed to be payable to the order of a specified person and not to him or his order, it is nevertheless payable to him or his order at his option.

9. Sum payable--(1) The sum payable by a bill is a sum certain within the meaning of this Act, although it is required to be paid-

(c ) By stated instalments, with a provision that upon default in payment of any instalment the whole shall become due;

(d) According to an indicated rate of exchange or according to a rate of exchange to be ascertained as directed by the bill.

(2) Where the sum payable is expressed in words and also in figures, and there is a discrepancy between the two the sum denoted by the words is the amount payable.

(3) Where a bill is expressed to be payable with interest, unless the instrument provides otherwise, interest runs from the date of the bill, and, if the bill is undated, from the issue thereof.

(a) If it is expressed to be payable on demand, or at sight, or on presentation; or

(2) Where a bill is accepted or indorsed when it is overdue, it shall, as regards the acceptor who so accepts, or any indorser who so indorses it, be deemed a bill payable on demand.

A bill payable on demand retained in circulation for in unreasonable time becomes overdue (s.36(3)). Days of grace are not allowed on a bill payable on demand (ss.14 and 96).

11. Bill payable at a future time-( 1) A bill is payable at a determinable future time within the meaning of this Act if it is expressed to be payable-

(b) On or at a fixed period after the occurrence of a specified event that is certain to happen. though the time of happening may be uncertain.

(2) An instrument expressed to be payable on a contingency is not a bill, and the happening of the event does not cure the defect.

12. Omission of date in bill payable after date-Where a bill expressed to be payable at a fixed period after date is issued undated, or where the acceptance of a bill payable at a fixed period after sight is undated, any holder may insert therein the true date of issue or acceptance, and the bill shall be payable accordingly:

Provided that (a) where the holder in good faith and by mistake inserts a wrong date, and (b) in every case where a wrong date is inserted, if the bill subsequently comes into the hand of a holder in due course, it shall not be avoided by the insertion of a wrong date, but shall operate and be payable as if the date so inserted had been the true date.

13. Antedating and postdating--(1) Where a bill or an acceptance or any indorsement on a bill is dated, the date shall, unless the contrary is proved, be deemed to be the true date of the drawing, acceptance, or indorsement. as the case may be.

(2) A bill is not invalid by reason only that it is antedated or postdated, or that it bears date on a Sunday.

14. Computation of time of payment-Where a bill is not payable on demand the day on which it falls due is determined as follows:

(a) Three days (called "days of grace") are in every case where the bill itself does not provide otherwise, added to the time of payment as fixed by the bill, and the bill is due and payable on the last day of grace:

[Provided that when the last day of grace is a non-business day the bill is due and payable on the next following business day.]

(b) Where a bill is payable at a fixed period after date, after sight, or after the happening of a specified event, the time of payment is determined by excluding the day from which the time is to begin to run and by including the day of payment.

(c) Where a b ill is payable at a fixed period after sight, the time begins to run from the date of the acceptance if the bill is accepted and from the date of noting or protest if the bill is noted or protested for non-acceptance or for non-delivery;

The proviso to para. (a) was substituted for subpara.s (i) and (ii) of that paragraph by s.13 of the Statutes Amendment Act 1946.

For definitions of "business day" and "non-business day`. see s.12 (1) of the Statutes Amendment Act 1946 (reprinted after s.2 of this Act).

15. Referee in case of need-The drawer of a bill and any indorser may insert therein the name of a person to whom the holder may resort in case of need-that is to say, in case the bill is dishonoured by non-acceptance or non-payment. Such person is called the referee in case of need. It is in the option of the holder to resort to the referee in case of need or not, as he thinks it.

16. Optional stipulations by drawer or indorser-The drawer of a bill, and any indorser, may insert therein an express stipulation-

17. Definition and requisites of acceptance-(1) The acceptance of a bill is the signification by the drawee or his assent to the order of the drawer.

(2) 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; the mere signature of the drawee without additional words is sufficient;

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

(b) When it is overdue, or after it has been dishonoured by a previous refusal to accept, or by non-payment.

(2) Where a bill payable after sight is 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 on the date of its first presentment to the drawee for acceptance.

For rules as to inchoate instruments see s. 20; and as to the negotiation of overdue bills, see s.36. An overdue bill on acceptance or indorsement becomes payable on demand as regards an acceptor or indorser (s.10(2)).

19. General and qualified acceptances-(1) An acceptance is either (a) general, or (b) qualified.

(2) A general acceptance assents without qualification to the order of the drawer, a qualified acceptance in express terms varies the effect of the bill as drawn.

(a) Conditional-that is to say, which makes payment by the acceptor dependent on the fulfilment of a condition therein stated:

(b) Partial-that is to say, an acceptance to pay part only of the amount for which the bill is drawn;

(c) Local-that is to say, an acceptance to pay only at a particular specified place. An acceptance to pay at a particular place is a general acceptance, unless it expressly states that the bill is to be paid there only and not elsewhere;

A bill, of itself, is not an assignment, and a drawee is not liable without acceptance (s.53). See also s.52.

20. Inchoate instruments-(1) Where a simple signature on a blank stamped paper is delivered by the signer in order that it may be converted into a bill, it operates as a prima facie authority to fill it up as a complete bill for any amount the stamp will cover, using the signature for that of the drawer, or the acceptor, or an indorser; and in like manner, where a bill is wanting in any material particular, the person in possession of it has a prima facie authority to fill up the omission in any way he thinks fit.

(2) In order that any such instrument when completed may be enforceable against any person who became a party thereto prior to its completion, it must be filled up within a reasonable time, and strictly in accordance with the authority given. Reasonable time for this purpose is a question of fact:

Provided that if any such instrument after completion is negotiated to a holder in due course, it shall be valid and. effectual for all purposes in his hands, and he may enforce it as if it had been filled up within a reasonable time and strictly in accordance with the authority given.

21. Delivery-(1) Every contract on a bill, whether it is the drawer's, the acceptor, or an indorsers, is incomplete and revocable until delivery of the instrument in order to give effect thereto:

Provided that where an acceptance is written on a bill, and the drawee gives notice to, or according to the directions of the person entitled to the bill that he has accepted it, the acceptance then becomes complete and irrevocable.

(2) As between immediate parties, and as regards a remote party other than the holder in due course, the delivery-

(a) In order to be effectual must be made either by or under the authority of the party drawing. accepting, or indorsing, as the else may be;

(b) May be shown to have been conditional or for a special purpose only, and not for the purpose- of transferring the property in the bill.

(3) If the bill is. in the hands of a holder in due course a valid delivery of the bill by all parties prior to him so as to make them liable to him is conclusively presumed.

(4) Where a bill is no longer in the possession of a parry who has signed it as drawer, acceptor, or indorser, a valid and unconditional delivery by him is presumed until the contrary is proved.

22. Capacity of parties-(1.) Capacity to incur liability as a party to a bill is co-extensive with capacity to contract:

Provided that nothing in this section shall enable a corporation to make itself liable as a drawer, acceptor. or indorser of a bill unless it is competent to it so to do under the law for the time being in force relating to corporations.

(2) Where a bill is drawn or indorsed by a minor or corporation, having no capacity or power to incur liability on a bill, the drawing or indorsement entitles the holder to receive payment of the bill and to enforce it against any other party thereto.

23. Signature essential to liability-No person is liable as drawer, indorser, or acceptor of a bill unless he has signed it as such:

(a) Where a person signs a bill in a trade or assumed name, he is liable thereon as if he had signed it in his own name;

(b) The signature of the name of a firm is equivalent to the signature by the person so signing of the names of all persons liable as partners in that firm.

24. Forged or unauthorised signature-(1) Subject to the provisions of this Act, where a signature on a bill is forged, or is placed thereon without the authority of the person whose signature it purports to be, the forged or unauthorised signature is wholly inoperative and no right to retain the bill or to give a discharge therefor or to enforce payment thereof against any party thereto can be acquired through or under that signature unless the party against whom it is sought to retain or enforce payment of the bill is precluded from setting up the forgery or want of authority.

(2) Nothing in this section shall affect the ratification of an unauthorised signature not amounting to a forgery.

25. Signature by procuration-A signature by procuration operates as notice that the agent has but a limited authority to sign and the principal is bound by such signature only the agent in so signing was acting within the actual limits of his authority.

26. Person signing as agent or representative- (1) Where a person signs a bill as drawer, indorser, or acceptor, and adds words to his signature indicating that he signs for or on behalf of a principal or in a representative character he is not personally liable thereon: but the mere addition to his signature of words describing him as an agent or as filling a representative character, does not exempt him from personal liability.

(2) In determining whether a signature on a hill is that of the principal, or that of the agent by whose hand it is written, the construction most favourable to the validity of the instrument shall he adopted.

27. Value, and holder for value-(1) Valuable consideration for a bill may be constituted by-

(b) An antecedent debt or liability. Such a debt or liability is deemed valuable consideration whether the bill is payable on demand or at a future time.

(2) Where value has at any time been given for a bill, the holder is deemed to be a holder for value as regards the acceptor and all parties to the bill who became parties prior to that time.

(3) Where the holder of a bill has a lien on it. arising either from contract or by implication of law, he is deemed to be a holder for value to the amount of the sum for which he has a lien.

28. Accommodation party- (1) An accommodation party to a bill is a person who has signed a bill as drawer, acceptor, or indorser without receiving value therefor, and for the purpose of lending his name to some other person.

(2) An accommodation party is liable on the bill to a holder for value: and it is immaterial whether, when such holder took the bill, he knew such party to be an accommodation party or not.

29. Holder in due course-(1) A holder in due course is a holder who has taken a bill, complete and regular on the face of it, under the following conditions, namely:

(a) That he became the holder of it before it was overdue, and without notice that it had been previously dishonoured, if such was the fact;

(b) That he took the bill in good faith and for value, and that at the time the bill was negotiated to him he had no notice of any defect in the title of the person who negotiated it.

(2) In particular, the title of a person who negotiates a bill is defective within the, meaning of this Act when he obtained the bill, or the acceptance thereof, by fraud, duress, or force and fear, or other unlawful means, or for an illegal consideration, or when he negotiates it in breach of faith, or under such circumstances as amount to a fraud.

(3) A holder (whether for value or not) who derives his title to a bill through a holder in due course, and who is not himself a party to any fraud or illegality affecting it, has all the rights of that holder in due course as regards the acceptor and all parties to the bill prior to that holder.

30. Presumption of value and good faith--(1) Every party whose signature appears on a bill is prima facie deemed to have become a parry thereto for value.

(2) Every holder of a bill is prima facie deemed to be a holder in due course; but if in an action on a bill it is admitted or proved that the acceptance, issue, or subsequent negotiation of the bill is affected with fraud, duress, or force and fear, or illegality, the burden of proof is shifted, unless and until the holder proves that. subsequent to the alleged fraud or illegality, value has in good faith been given for the bill.

31. Negotiation of bill-(1) A bill is negotiated when it is transferred from one person to another in such a manner as to constitute the transferee the holder of the bill.

(3) A bill payable to order is negotiated by the indorsement of the holder completed by delivery.

(4) Where the holder of a bill payable to his order transfers it for value without indorsing it, such the transfer gives the transferee such title as the transferor had in the bill, and the transferee in addition acquires the right to have the indorsement of the transferor.

(5) Where any person is under obligation to indorse a bill in a representative capacity, he may indorse the bill in such as to negative personal liability.

For definitions of "holder", "bearer", "indorsement" see s.2; as to "delivery see ss.2 and 21.

32. Requisition of a valid indorsement-An indorsement in order to operate, as a negotiation must comply with the following conditions, namely:

(a) It must: be written on the bill itself and be signed by the indorser; the simple signature of the indorser on the bill, without additional words, is sufficient:

Provided that an indorsement written on an allonge, or on a "copy" of a bill issued or negotiated in a country where "copies" are recognised, shall be deemed to be written on the bill itself.

(b) It must be an indorsement of the entire bill. A partial indorsement-that is to say, an indorsement that purports to transfer to the indorsee a part only of the amount payable, or to transfer the bill to two or more indorsees severally-does not operate as a negotiation of the bill.

(c) Where a bill is payable to the order of two or more payees or indorsees who are not partners, all must indorse, unless the one indorsing has authority to indorse for the others.

(d) Where in a bill payable to order the payee or indorsee is wrongly designated, or his name is misspelt, he may indorse the bill as therein described adding, if he thinks fit his proper signature.

(e) Where there are two or more indorsements on a bill, each indorsement is deemed to have made in the order in which it appears on the bill, until the contrary is proved.

(f) An indorsement may be either special or in blank: it may also contain terms making it restrictive.

33. Conditional indorsement-Where a bill purports to be indorsed conditionally, the condition may be disregarded by the payer, and payment to the indorsee is valid whether the condition has been fulfilled or not.

34. Indorsement in blank and special indorsement- (1) An indorsement in blank specifies no indorsee, and a bill so indorsed becomes payable to bearer.

(2) A special indorsement specifies the person to whom, or to whose order the bill in to be payable.

(3) The provisions of this Act relating to a payee apply, with the necessary modifications, to an indorsee under a special indorsement.

(4) Where a bill has been indorsed in blank, any holder may convert the blank indorsement into a special indorsement by writing above the indorser's signature a direction to pay the bill to or to the order of himself or some other person.

35. Restrictive indorsement-(1) An indorsement is restrictive which prohibits the further negotiation of the bill, or which expresses that it is a mere authority to deal with the bill as thereby directed and not a transfer of the ownership thereof-as, for example, if a bill is indorsed 'Tay D. only', or 'Tay D. for the account of X.", or 'Tay D. or order for collection".

(2) A restrictive indorsement gives the indorsee the right to receive payment of the bill.. and to sue any party thereto that his indorser could have sued,. but gives him no power to transfer his rights as indorsee unless it expressly authorises him to do so.

(3) Where a restrictive indorsement authorises further transfer, all subsequent indorsees take the bill with the same rights and subject to the same liabilities as the first indorsee under the restrictive indorsement.

36. Negotiation of overdue or dishonoured bill-(1) Where a bill is negotiable in its origin, it continues to be negotiable until it has been either restrictively indorsed, or discharged by payment or otherwise.

(2) Where an overdue bill is negotiated, it can be negotiated only subject to any defect of title affecting it at Its maturity, and thence forward no person who takes it can acquire or give a better title than that which the person from whom he took it had.

(3) A bill payable on demand is deemed to be overdue within the meaning and for the purposes of his section when it appears on the fire of it to have been In circulation for an unreasonable length of time. What is in unreasonable length of time for this purpose is a question of fact.

(4) Except where an indorsement bears date after the maturity of the bill, every negotiation is prima facie deemed to have been effected before the bill became overdue.

(5) Where a bill that is not overdue has been dishonoured, any person who takes it with notice of the dishonour takes it subject to any defect of title attaching thereto at the time of dishonour: but nothing in this subsection shall affect the rights of a holder in due course.

37. Negotiation of bill to party already liable thereon-Where a bill is negotiated back to the drawer, or to a prior endorser, or to the acceptor, such party may, subject to the provisions of this Act, reissue and further negotiate the bill, but he is not entitled to enforce payment of the bill against any intervening party to whom he was previously liable.

If the acceptor becomes the holder upon or after maturity the bill is discharged and cannot be negotiated (s.61).

38. Rights of the holder-The rights and powers of the holder of a bill are as follows:

(b) Where he is a holder in due course, he holds the bill free from any defect of title of prior parties, as well as from mere personal defences available to prior parties among themselves, and may enforce payment against all parties liable on the bill;

(i) If he negotiates the bill to a holder in due course, that holder obtains a good and complete title to the bill; and

(ii) If he obtains payment of the bill, the person who pays him in due course gets a valid discharge for the bill.

For definition of "holder", see s.2; for "holder for value", s.27; for "holder in due course" and "defect of title", s.29; and for "payment in due course", s.59(2).

39. When presentment for acceptance is necessary-(1) Where a bill is payable after sight. presentment for acceptance is necessary in order to fix the maturity of the instrument.

(2) Where a bill expressly stipulates that it shall be presented for acceptance, or where a bill is drawn payable elsewhere than at the residence or place of business of the drawee, it must be presented for acceptance before it can be presented for payment.

(3) In no other case is presentment for acceptance necessary in order to render liable any party to the bill.

(4) Where the holder of a bill drawn payable elsewhere than at the place of business or residence of the drawee has not time, with the exercise of reasonable diligence, to present the bill for acceptance before presenting it for payment on the day that it fails due.,the delay caused by presenting the bill for acceptance before presenting it for payment is excused and does not discharge the drawer and indorsers.

40. Time for presenting bill payable after sight-(1) Subject to the provisions of this Act, where a bill payable after sight is negotiated, the holder must either present it for acceptance or negotiate it within a reasonable time.

(2) If he does not do so, the drawer and all indorsers prior to that holder are discharged.

(3) In determining what is a reasonable time within the meaning of this section, regard shall be had to the nature of the bill, the usage of trade with respect to similar bills, and the facts of the particular case.

41. Rules as to presentment for acceptance, and excuses for non-presentment-(1) A bill is duly presented for acceptance if it is presented in accordance with the following rules:

(a) The presentment must be made by or on behalf of the holder to the drawee, or to some person authorised to accept or to refuse acceptance on his behalf, at a reasonable hour on a business day and before the bill is overdue:

(b) Where a bill is addressed to two or more drawees, who are not partners, presentment must be made to them all, unless one has authority to accept for all, in which case presentment may be made to him only;

(d) Where the drawee is bankrupt, presentment may be made to him or to his assignee;

(e) Where authorised by agreement or usage, a presentment through the post office is sufficient.

(2) Presentment in accordance with these rules is excused, and a bill may be treated as dishonoured by non-acceptance,-

(f) Where the drawee is dead or bankrupt, or is a fictitious person, or a person not having capacity to contract by bill;

(g) Where, after the exercise of reasonable diligence, such presentment cannot be effected;

(h) Where, although the presentment has been irregular, acceptance has been refused on some other ground.

(3) The fact that the holder has reason to believe that the bill, on presentment, will be dishonoured does not excuse presentment.

42. Non-acceptance-Where a bill is duly presented for acceptance and is not accepted within the customary time, the person presenting it must treat it as dishonoured by non-acceptance. If he does not, the holder shall lose his right of recourse against the drawer and indorsers.

43. Dishonour by non-acceptance, and its consequences-(1) A bill is dishonoured by non-acceptance-

(a) Where it is duly presented for acceptance, and such an acceptance as is prescribed by this Act is refused, or cannot be obtained; or

(2) Subject to the provisions of this Act, when a bill is dishonoured by non-acceptance an immediate right of recourse against the drawer and indorsers accrues to the holder. And, no presentment for payment is necessary.

44. Qualified acceptance-(1) The holder of a bill may refuse to take a qualified acceptance, and if he does not obtain a general acceptance may treat the bill as dishonoured by non-acceptance.

(2) Where a qualified acceptance is taken, and the drawer or an indorser has not expressly or impliedly authorised the holder m take a qualified acceptance, or does not subsequently assent thereto, such drawer or indorser is discharged from his liability on the bill. The provisions of this subsection do not apply to a partial acceptance whereof due notice has been given. Where a foreign bill has been accepted as to part, it must be protested as to the balance.

(3 ) Where the drawer or indorser of a bill receives notice of a qualified acceptance, and does not within a reasonable time express his dissent to the holder, he shall be deemed to have assented thereto.

45. Rules as to presentment for payment-(1) Subject to the provisions of this Act, a bill must be duly presented for payment. If it is not so presented the drawer and indorsers shall be discharged.

(2) A bill is presented for payment if it is presented in accordance with the following rules:

(a) Where the bill is not pavable on demand, presentment must be made on the day it falls due;

(b) Where the bill is pavable on demand, then,. subject to the provisions of this Act, presentment must be made within a reasonable time after its issue in order to render the drawer liable, and within a reasonable time after its indorsement in order to render the indorser liable.

In determining what is reasonable time regard shall be had to the nature of the bill, the usage of trade with regard to similar bills, and the facts of the particular case.

(c) Presentment must be made by the holder, or by some person authorised to receive payment on his behalf. at a reasonable hour on a business day. at the proper place as hereinafter defined. either to the person designated by the bill as payer, or to some person authorised to pay or refuse payment on his behalf, if by the exercise of reasonable diligence such person can there be found.

(i) Where a place of payment is specified in the bill, and the bill is there presented;

(ii) Where no place of payment is specified, but the address of the drawee or acceptor is given in the bill, and the bill is there presented;

(iii) Where no place of payment is specified and no address given, and the bill is presented at the drawee's or acceptor's place of business, if known, and if not, at his ordinary residence, if known;

(iv) In any other case, if presented to the drawee or acceptor at his last known place of business or residence or wherever he can be found.

(e) Where a bill is presented at the proper place and after the exercise of reasonable diligence no person authorised to pay or refuse payment can be found there, no further presentment to the drawee or acceptor is required.

(f) Where a bill is drawn upon or accepted by two or more persons who are riot partners. and no place of payment is specified. presentment must be made to them all.

(g) Where the drawee or acceptor of the bill is dead. and no place of payment is specified, presentment must be made to the executor or administrator of the deceased. if any, and if by the exercise of reasonable diligence he call be found.

(h) Where authorised by agreement or usage, presentment through the post office is sufficient.

46. Excuses for delay or non-presentment for payment-(1) Delay in making presentment for payment is excused when the delay is caused by circumstances beyond the control of the holder, and not imputable to his default, misconduct,. or negligence. When the cause of delay ceases to operate. presentment must be made with reasonable diligence.

(a) Where, after the exercise of reasonable diligence, presentment as required by this Act cannot be effected;

The fact that the holder has reason to believe that the bill will, on presentment, be dishonoured, does not dispense with the necessity for presentment;

(c) As regards the drawer, where the drawee or acceptor is not bound, as between himself and the drawer, to accept or pay the bill and the drawer has no reason to believe that the bill would be paid if presented;

(d) As regards an indorser, where the bill was accepted or made for the accommodation of that indorser. and he has no reason to believe that the bill would be paid if presented;

Where a drawee is a person not having capacity to contract, presentment for acceptance is excused (s. 41(2)), but presentment for payment must be made (subject to subs. (2)(c) of this section).

(a) Where it is duly presented for payment and payment is refused, or cannot be obtained; or

(2) Subject to the provisions of this Act, where a bill is dishonoured by non-payment an immediate right of recourse against the drawers or indorsers accrues to the holder.

48. Notice of dishonour-Subject to the provisions of this Act, where a bill has been dishonoured by non-acceptance or by non-payment, notice of dishonour must be given to the drawer and each indorser, and any drawer or indorser to whom such notice is not given is discharged:

(a) Where a bill is dishonoured by non-acceptance and notice of dishonour is not given, the rights of a holder in due course subsequent to the omission shall not be prejudiced by the omission:

(b) Where a bill is dishonoured by non-acceptance and due notice of dishonour is given, it shall not be necessary to give notice of a subsequent dishonour by non-payment unless the bill has in the meantime been accepted.

For "dishonour by non-acceptance", see s. 43, and for "dishonour by non-payment", s. 47.

49. Rules as to notice of dishonour-Notice of dishonour in order to be valid and effectual must be given in accordance with the following rules:

(a) The notice must be given by or on behalf of the holder, or by or on behalf of an indorser who, at the time of giving it, is himself liable on the bill.

(b) Notice of dishonour may be given by an agent either in his own name or in the name of any party entitled to give notice, whether that party is his principal or not.

(c) Where the notice is given by or on behalf of the holder, it enures for the benefit of all subsequent holders and all prior indorsers having a right of recourse against the party to whom it is given,

(d) Where notice is given by or (in behalf of an indorser entitled to give notice is hereinbefore provided. it enures for the benefit of the holder and all indorsers subsequent to the party to whom notice is given.

(e) The notice may be given either in writing or by personal communication, and may be given in any terms sufficient to identify the bill, and intimating that the bill has been dishonoured by non-acceptance or non-payment.

(f) The return of a dishonoured bill to the drawer or an indorser is in point of form deemed a sufficient notice of dishonour.

(g) A written notice need not be signed, and an insufficient written notice may be supplemented and made valid by verbal communication.

(h) A misdescription of the bill shall not vitiate the notice unless the party to whom the notice is given is in fact misled thereby.

(i) Where notice of dishonour is required to be given to any person. it may be given either to the party himself or to his agent in that behalf.

(j) Where the drawer or indorser is dead and the party giving notice is aware of the fact, the notice must be given to an executor or administrator of the deceased if any and if by the exercise of reasonable diligence he can be found.

(k) Where the drawer or indorser is bankrupt notice may be given either to the party himself or to his assignee.

(1) Where there are more than two drawers or indorsers who are not partners, notice must be given to each of them, unless one of them has authority to receive such notice on behalf of the others.

(m) The notice may be given as soon is the bill is dishonoured, and must be given within a reasonable time thereafter.

(n) In the absence of special circumstances notice is not deemed to have been given within a reasonable time unless-

(i) Where the person giving and the person to receive notice reside in the same place the notice is given or sent off in time to reach the latter on the day after the dishonour of the bill;

(ii) Where the person giving and the person to receive notice reside in different places the notice in sent off on the day after the dishonour of the bill, if there is a post at a convenient hour an that day, and. if there is no such post on that day, then by the next post thereafter.

(o) Where a bill when dishonoured is in the hands of an agent he may either himself give notice to the parties liable on the bill or he may give notice to his principal. If he gives notice to his principal, he must do so within the same time as if he were the holder: and the principal, upon receipt of such notice, has himself the same time for giving notice as if the agent had been an independent holder.

(p) Where a party to a bill receives due notice of dishonour, he has after the receipt of such notice the same period of time forgiving notice to antecedent parties that the holder has after the dishonour.

(q) Where a notice of dishonour is duly addressed and posted, the sender is deemed to have given due notice of dishonour notwithstanding any miscarriage by the post office.

50. Excuses for want of notice and delay-(1) Delay in giving notice of dishonour is excused where the delay is caused by circumstances beyond the control of the party giving notice, and not imputable to his default, misconduct or negligence. When the cause of delay ceases to operate the notice must be given with reasonable diligence.

(a) When, after the exercise of reasonable diligence, notice by this Act cannot be given as required to or does not reach the drawer or indorser sought to be charged;

(b) By waiver, express or implied, either before the time of giving notice of dishonour has arrived, or after the omission to give due notice;

(ii) Where the drawee is a fictitious person, or a person not having capacity to contract;

(iv) Where the drawee or acceptor is as between himself and the drawer under no obligation to accept or pay the bill;

(i) Where the drawee is a fictitious person, or a person not having capacity to contract, and the indorser was aware of the fact at the time he indorsed the bill;

(ii) Where the indorser is the person to whom the bill is presented for payment;

51.-Noting or protest of bill-(1) Where an inland bill has been dishonoured it may, if the owner thinks fit, be noted for non-acceptance or non-payment, as the case may be, but it shall not be necessary to note or protest any such bill in order to preserve the recourse against the drawer or indorser.

For definition of "inland bill", see s.4.
As to noting or protest on acceptance and payment for honour see ss. 65-68.
The formalities of "noting" and "protest" are described in Halsbury's Laws of England, title Bills of Exchange; and see subs.9 of this section.
Protest is not necessary to charge an acceptor of a bill (s .52(3)).

(2) Where a foreign bill, appearing on the face of it to be such has been dishonoured by non-acceptance it must be duly protested for non-acceptance, and where such a bill, not having been previously dishonoured by non-acceptance, is dishonoured by non-payment it must be duly protested for non-payment, otherwise the drawer and indorsers are discharged.

Protest is not necessary to charge an acceptor of a bill (s.52 (3)), or the maker of a promissory note (s.90(4) and see subs. (3) of this section.

(3) Where a bill does not appear on the face of it to be a foreign bill, protest thereof as in case of dishonour is unnecessary.

(4) A bill that has been protested for non-acceptance may be subsequently protested for non-payment.

(5) Subject to the provisions of this Act, where a bill is noted or protested it must be noted on the day of dishonour.

(6) Where a bill has been duly noted, the protest may be subsequently extended so as to take effect from the date of the noting.

(7) Where the acceptor of a bill becomes bankrupt or insolvent or suspends payment before it matures, the holder may cause the bill to be protested for better security of the drawer and indorsers.

(a) Where a bill is presented through the post office, and returned by post dishonoured, it may be protested at the place to which it is returned and on the day of its return if received during business hours, and if not received during business hours then not later than the next business day; and

(b) When a bill drawn payable at the place of business or residence of some person other than the drawee has been dishonoured by non-acceptance, it must be protested for non-payment at the place where it is expressed to be payable, and no further presentment for payment to or demand on the drawee is necessary.

(9) A protest must contain a copy of the bill and must be signed by the notary making it, and must specify-

(b) The place and date of protest, the cause or reason for protesting the bill, the demand made, and the answer given, if any, or the fact that the drawee or acceptor could not be found.

(10) Where a bill is lost or destroyed, or is wrongly detained from the person entitled to hold it, protest may be made on a copy or on written particulars thereof.

(11) Protest is dispensed with by any circumstance that would dispense with notice of dishonour.

(12) Delay in noting or protesting is excused when the delay is caused by circumstances beyond the control of the holder, and not imputable to his default, misconduct or negligence. When the cause of delay ceases to operate the bill must be noted or protested with reasonable diligence.

52. Duties of holder as regards drawee or acceptor--(1) When a bill is accepted generally, presentment for payment is not necessary in order to render the acceptor liable.

(2) When by the terms of a qualified acceptance presentment for payment is required, the acceptor, in the absence of an express stipulation to that effect, is not discharged by the omission to present the bill for payment on the day that it matures.

(3) In order to render the acceptor of a bill liable it is not necessary to protest it, or that notice of dishonour should be given to him.

(4) When the holder of a bill presents it for payment, he shall exhibit the bill to the person from whom he demands payment, and when a bill is paid the holder shall forthwith deliver it up to the party paying it.

53. Funds in hands of drawee-A bill of itself does not operate as an assignment of funds in the hands of the drawee available for the payment thereof, and the drawee of a bill who does not accept as required by this Act is not liable on the instrument.

(i) The existence the drawer, the genuineness of his signature, and his capacity and authority to draw the bill:

(ii) In the case of a bill payable to drawer's order, the then capacity of the drawer to indorse, but not the genuineness or validity of his indorsement;

(iii) In the case of a bill payable to the order of a third person, the existence of the payee and his then capacity to indorse, but not the genuineness or validity of his indorsement.

55. Liability of drawer or indorser-(1) The drawer of a bill, by drawing it,-

(a) Engages that on due presentation it shall be accepted and paid according to its tenor, and that if it is dishonoured he will compensate the holder or my indorser who is compelled to pay it, provided that the requisite proceedings on dishonour until duly taken;

(b) Is precluded from denying to a holder in due course the existence of the payee and his then capacity to indorse.

(c) Engages that on due presentment it shall be accepted and paid according to its tenor, and that if it is dishonoured he will compensate the holder or a subsequent indorser who is compelled to pay it, provided that the requisite proceedings on dishonour are duly taken;

(d) 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:

(e) Is precluded from denying to his immediate or a subsequent indorsee that the bill was at the time of his indorsement a valid and subsisting bill. and that he had then a good title thereto.

A drawer or indorser may negative or limit liability by express stipulation in a bill (s.16).

56. Stranger signing bill liable as indorser-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.

57. Measure of damages against parties to dishonoured bill-Where a bill is dishonoured, the measure of damages, which shall be deemed to be liquidated damages, shall be as follows:

(a) The holder may recover from any party liable on the bill, and the drawer who has been compelled to pay the bill may recover from the acceptor, and an indorser who has been compelled to pay the bill may recover from the acceptor or from the drawer, or from a prior indorser.-

(ii) Interest thereon from the time of presentment for payment if the bill is payable on demand, and from the maturity of the bill in any other case.

(iii) The expenses of noting, or, when protest is necessary and the protest has been extended, the expenses of protest.

(b) In the case of a bill that has been dishonoured abroad, in lieu of the above damages the holder may recover from the drawer or an indorser, and the drawer or an indorser who has been compelled to pay the bill may recover from any party liable to him, the amount of the re-exchange, with interest thereon until the time of payment.

(c) Where by this Act interest may be recovered as damages, such interest may, if justice requires it, be withheld wholly or in part and, where a bill is expressed to be payable with interest at a given rate, interest as damages may or may not be given at the same rate as interest proper.

58. Transferor and transferee by delivery-(1) Where the holder of a bill payable to bearer negotiates it by delivery without indorsing it, he is called a "transferor by delivery".

(3) A transferor by delivery who negotiates a bill thereby warrants to his immediate transferee being a holder for value that the bill is what it purports to be, that he has a right to transfer it, and that at the time of transfer he is not aware of any fact which renders it valueless.

For the meaning of "payable to bearer", see s.8(3), and as to negotiation by delivery, see s.31(1), (2).

59. Payment in due course-(1) A bill is discharged by payment in due course by or on behalf of the drawee or acceptor.

(2) "Payment in due course" means payment to the holder of the bill made at or after the maturity thereof in good faith and without notice that the holder's title is defective.

(3) Subject to the provisions hereinafter contained, when a bill is paid by the drawer or an indorser it is not discharged: but

(a) Where a bill payable to or to the order of a third party is paid by the drawer, the drawer may enforce payment thereof against the acceptor, but may not reissue the bill;

(b) Where a bill is paid by an indorser, or where a bill payable to drawer's order is paid by the drawer, the party paying it is remitted to his former rights as regards the acceptor or antecedent parties, and may, if he thinks fit, strike out his own and subsequent indorsements; and again negotiate the bill.

(4) Where an accommodation bill is paid in due course, by the party accommodated the bill is discharged.

60. Banker paying on demand draft bearing forged indorsement-(1) Where a bill payable to order on demand is drawn on a banker, and the banker an whom it is drawn pays the bill in good faith and in the ordinary course of business, it is not incumbent on the banker to show that the indorsement of the payee or any subsequent indorsement was made by or under the authority of the person whose indorsement it purports to be and the banker is deemed to have paid the bill in due course although such indorsement has been forged or made without authority.

(2) Where a banker carries on the business of banking at more branches than one he shall, for the purposes of this section, be deemed to be an independent banker in respect of each of such branches, and a draft issued by one of such branches and pavable at another shall be deemed to be a bill.

61. Where acceptor the holder at maturity-Where the acceptor of a bill is or becomes the holder of it in his own right, at or after its maturity, the bill is discharged.

62. Holder may waive his rights--(1) Where the holder of a bill at or after its maturity absolutely and unconditionally renounces his rights against the acceptor the bill is discharged. The renunciation must be in writing, unless the bill is delivered up to the acceptor.

(2) The liabilities of any Party to a bill may in like manner be renounced by the holder before, at or after its maturity.

(3) Nothing in this section shall affect the rights of a holder in due course without notice of any such renunciation.

63.Cancellation-(1) Where a bill is intentionally cancelled by the holder or his agent and the cancellation is apparent thereon the bill is discharged.

(2) Any party liable on a bill may in like manner be discharged by the intentional cancellation of his signature by the holder or his agent. In such case an indorser who would have had a right of recourse against the party whose signature has been cancelled is also discharged.

(3) A cancellation made unintentionally, or under a mistake or without the authority of the holder is inoperative; but where a bill or any signature thereon appears to have been cancelled the burden of proof lies on the party who allege that the cancellation was made unintentionally, or under a mistake, or without authority.

64. Alteration of bill-(1) Where a bill or acceptance is materially altered without the assent of all parties- liable on the bill the bill is avoided except as against a party who has himself made, authorised, or assented to the alteration, and subsequent indorsers:

Provided that where a bill has been materially altered, but the alteration in not apparent, and the bill is in the hands of a holder in due course, such holder may avail himself of the bill as if it had not been altered, and may enforce payment of it according to its original tenor.

(2) In particular the following alterations are material, namely, any alteration of the date, the sum payable, the time of payment, the place of payment, and, where a bill has been accepted generally, the addition of a place of payment without the acceptor's assent.

65. Acceptance for honour supra protest-(1) Where a bill of exchange has been protested for dishonour by non-acceptance, or protected for better security, and is not overdue any person not being a party already liable thereon, may , with the consent of the holder intervene and accept the bill supra protest, for the honour of any party liable thereon or for the honour of the person on whose account the bill is drawn.

(2) A bill may be accepted for honour for part only of the sum for which it is drawn.

(a) Be written on the bill and indicate that it is an acceptance for honour, and

(4) Where an acceptance for honour does not expressly state for whose honour it is made, it is deemed to be an acceptance for the honour of the drawer.

(5) Where a bill payable after sight is accepted for honour, its maturity is calculated from the date of the noting for non-acceptance, and not from the date of the acceptance for honour.

66. Liability of acceptor for honour-(1) The acceptor for honour of a bill by accepting it engages that he will on due presentment, pay the bill according to the tenor of his acceptance if it is not paid by the drawee, provided that it has been duly presented for-payment and protested for non-payment that he receives notice of these facts.

(2) The acceptor for honour is liable to the holder and to all parties to the bill subsequent to the party for whose honour he has accepted.

67. Presentation to acceptor for honour--(1) Where a dishonoured bill has been accepted for honour supra protest or contains a reference in case of need, it must be protested for non-payment before it is presented for payment to the acceptor for honour or referee in case of need.

(2) Where the address of the acceptor for honour is in the same place where the bill is protested for non-payment, the bill must be presented to him not later than the day following its maturity, and where the address of the acceptor for honour is in some place other than the place where it was protested for non-payment the bill must be forwarded for presentment to him not later than the day following its maturity.

(3) Delay in presentment, or non-presentment, is excused by any circumstance that would excuse delay in presentment for payment, or non-presentment for payment.

(4) Where a bill is dishonoured by the acceptor for honour it must be protested for non-payment by him.

68. Payment for honour supra protest-(1) Where a bill has been protested for non-payment, any person may intervene and pay it supra protest for the honour of any party liable thereon, or for the honour of the person on whose account the bill is drawn.

(2) Where two or more persons offer to pay a bill for the honour of different parties, the person whose payment will discharge most parties to the bill shall have the preference.

(3) Payment for honour supra protest, in order to operate as such and not as a mere voluntary payment, must be attested by a notarial act of honour, which may be appended to the protest or may form an extension of it.

(4) The notarial act of honour must be founded on a declaration made by the payer for honour, or his agent in that behalf, declaring his intention to pay the bill for honour, and for whose honour he pays.

(5) Where a bill has been paid for honour, all parties subsequent to the party for whose honour it is paid are discharged, but the payer for honour is subrogated for and succeeds to both the rights and duties of the holder, as regards the party for whose honour he pays and all parties liable to that party.

(6) The payer for honour, on paying to the holder the amount of the bill and the notarial expenses incidental to its dishonour, is entitled to receive both the bill itself and the protest, and if the holder does not deliver them up on demand he shall be liable to the payer for honour in damages.

(7) Where the holder of a bill refuses to receive payment supra protest he shall lose his right of recourse against any party who would have been discharged by such payment.

69. Holder's right to duplicate of lost bill-(1) Where a bill has been lost before it is overdue, the person who was the holder of it may apply to the drawer to give him another bill of the same tenor, giving security to the drawer if required to indemnify him against all persons whatever in case the bill alleged to have been lost is found again.

(2) If the drawer, on request as aforesaid, refuses to give such duplicate bill, he may be compelled to do so.

70.Action on lost bill-In any action or proceeding upon a bill the Court or a Judge may order that the loss of the instrument shall not be set up, provided an indemnity is given to the satisfaction of the Court or Judge against the claims of any other person upon the instrument in question.

71. Rules as to sets-( 1 ) Where a bill is drawn in a set, each part of the set being numbered, and containing a reference to the other parts, the whole of the parts constitute one bill.

(2) Where the holder of a set indorses two or more parts to different persons, he is liable on every such part and every indorser subsequent to him is liable on the part he has himself indorsed as if the said parts were separate bills.

(3) Where two or more parts of a set are negotiated to different holders in due course, the holder whose title first accrues is, as between such holders, deemed the true owner of the bill; but nothing in this subsection shall affect the rights of a person who in due course accepts or pays the part first presented to him.

(4) The acceptance may be written on any part, and it must be written on one part only.

(5) If the drawee accepts more than one part. and such accepted parts get into the hands of different holders in due course, he is liable on every part as if it were a separate bill.

(6), Where the acceptor of a bill drawn in a set pays it without requiring the part bearing his acceptance to be delivered up to him, and that part at maturity is outstanding in the hand, of a holder in due course, he is liable to the holder thereof.

(7) Subject to the preceding rules, where any one part of a bill drawn in a set is discharged by payment or otherwise, the whole bill is discharged.

72. Law governing contracts contained in a bill-Where a bill drawn in one country is negotiated, accepted, or payable in another, the rights, duties, and liabilities of the parties thereto are determined as follows:

(a) The validity of a bill as regards requisites in form is determined by the law of the place of issue, and the validity as regards requisites in form of the supervening contracts, such as acceptance, or indorsement, or acceptance supra protest, is in each case determined by the law of the place where the contract was made:

(i) Where a bill is issued out of the Cook Islands it is not invalid by reason only that it is not stamped in accordance with the law of the place of issue;

(ii) Where a bill issued out of the Cook Islands conforms as regards requisites in form, to the law of the Cook Islands, it may, for the purpose of enforcing payment thereof, be treated as valid as between all persons who negotiate, hold, or become parties to it in the Cook Islands:

(b) Subject to the provisions of this Act, the interpretation of the drawing, indorsement, acceptance, or acceptance supra protest of a bill is determined by the law of the place where such contract was made:

Provided that where an inland bill is indorsed in a foreign country the indorsement shall, as regards the payer, be interpreted according to the law of the Cook Islands:

(c) The duties of the holder with respect to presentment for acceptance or payment and the necessity for or sufficiency of a protest or notice of dishonour, or otherwise, are determined by the law of the place where the act is done or the bill is dishonoured:

(d) Where a bill is drawn out of but is payable in the Cook Islands and the sum payable is not expressed in the currency of the Cook Islands the amount shall, in the absence of some express stipulation, be calculated according to the rate of exchange for sight drafts at the place of payment on the day the bill is pavable:

(e) Where a bill is drawn in one country and is payable in another, the due date thereof is determined according to the law of the place where it is payable.

73. "Cheque" defined-(1) A cheque is a bill of exchange drawn on a banker payable on demand.

(2) Except as otherwise provided in this Part of this Act, the provisions of this Act applicable to a bill of exchange payable on demand apply to a cheque.

74. Presentment of cheques for payment-Subject to the provisions of this Act,-

(a) Where a cheque is not presented for payment within a reasonable time after its issue, and the drawer or the person on whose account it is drawn had the right at the time of such presentment as between himself and the banker to have the cheque paid, and suffers actual damage through the delay, he is discharged to the extent of such damage that is to say, to the extent co which such drawer or person is a creditor of such banker to a larger amount than he would have been had such cheque been paid;

(b) In determining what is a reasonable time regard shall be had to the nature of the instrument, the usage of trade and of bankers, and the facts of the particular case;

(c) The holder of such cheque as to which such drawer or person is discharged shall be a creditor, in lieu of such drawer or person of such banker co the extent of such discharge, and shall be entitled to recover the amount from him.

[75. Revocation of banker's authority-(1) The duty and authority of a banker to pay a cheque drawn on him by his customer are determined by-

(2) Notwithstanding the provisions of paragraph (b) of subsection (1) of this section, a banker may pay a cheque drawn on him, notwithstanding that he has notice of the death of the customer who drew it, if the cheque is presented not more than 10 days after the date of the customer's death, unless-

(b) The banker receives a countermand of payment by a person who claims to be entitled to a grant of administration in respect of or to be a beneficiary of the customer's estate.]

This section was substituted for the former s.75 by s.2 of the Bills of Exchange Amendment Act 1971.

As to the authority of a banker on the bankruptcy of his customer, see ss.47-49 of the Insolvency Act, 1967.

76. General and special crossings defined-(1) Where cheque bears across its face an addition of-

(a) The words "and company", or "bank", or any abbreviation thereof, between two parallel transverse lines, either, with or without the words not negotiable"; or

(b) Two parallel transverse lines simply, either with or without the words "Not negotiable", that addition constitutes a crossing, and the cheque is crossed generally.

(2) Where a cheque bears across its face in addition of the name of a banker, either with or without the words "Not negotiable", that addition constitutes a crossing, and the cheque is crossed specially and to that banker.

Ss. 76-82 apply to interest warrants issued by the Registrar of Government stock: see s.29(3) of the New Zealand Loans Act 1953: and to interest warrants issued by the Registrar of Stock under the Local Authorities Loan Act 1956: see s. 73(3) of that Act.

77. Crossing by drawer or after issue-(1) A cheque may be crossed generally or specially by the drawer.

(4) Where a cheque is crossed generally or specially, the holder may add the words "Not negotiable".

(5) Where a cheque is crossed specially, the banker to whom it is crossed may again cross it specially to another banker for collection.

(6) Where an uncrossed cheque, or a cheque crossed generally, is sent to a banker for collection, the banker may cross it specially to himself.

For the effect of the crossing "Not negotiable", see s.81, and for definition of "holder", see s.2.

78. Crossing to he deemed a material part of cheque-A crossing authorised by this Act is a material part of the cheque, and no person may obliterate or, except as authorised by this Act, add to or alter the crossing.

79. Duties of banker as to crossed cheques-(1) Where a cheque is crossed specially to more than one banker, except when crossed co an agent for collection being a banker, the banker on whom it is drawn shall refuse payment thereof.

(2) Where the banker on whom a. cheque so crossed is drawn nevertheless pays the same, or pays a cheque crossed generally otherwise than to a banker, or if crossed specially otherwise than to the banker to whom it is crossed, or his agent for collection being a banker, he is liable to the true owner of the cheque for any loss he may sustain owing to the cheque having been so paid.

(3) Where a cheque presented for payment does nor at the time of presentment appear to be crossed, or to have had a crossing which has been obliterated, or to have been added to or altered otherwise than as authorised by this Act, the banker paying the cheque in good faith and without negligence shall not be responsible or incur any liability, nor shall the payment be questioned by reason of the cheque having been crossed, or of the crossing having been obliterated or having been added to or altered otherwise than as authorised by this Act, and of payment having been made otherwise than co a banker, or to the banker co whom the cheque is or was crossed, or to his agent for collection being a banker, as the case may be.

As to the application of this section to instruments other than cheques, see s.6 of the Cheques Act 1960; and to money orders, see s.132A of the Post Office Act 1959.

80. Protection to banker and drawer where cheque is crossed-Where the banker on whom a crossed cheque is drawn pays it in good faith and without negligence, if crossed generally, to a banker, and, if crossed specially, to the banker to whom it is crossed, or to his agent for collection being a banker, the banker paying the cheque, and, if the cheque has come into the hands of the payee, the drawer, shall respectively be entitled to the same rights and be placed in the same position as if payment of the cheque had been made to the true owner thereof.

As to the application of this section to instruments other than cheques; see s.6 of the Cheques Act 1960; and to money orders, see s.132A of the Post Office Act 1959.

81. Effect of the words "Not negotiable"-Where a person takes a crossed cheque bearing on it the words "not negotiable", he shall not have and shall not be capable of giving a better title to the cheque than that which the person from whom he took it had.

As to the application of this section to instruments other than cheques, see s.6 of the Cheques Act 1960; and to money orders, see s.132A of the Post Office Act 1959.

Statutory references to s. 82 now become references to the Cheques Act 1960: see s.8(2) of that Act.

83. Branch banks deemed independent banks for certain purposes-Where a banker carries on the business of banking at more branches than one he shall, for the purposes of sections 76 to 81 hereof [and for the purposes of the Cheques Act 1960, be deemed to be an independent banker in respect of each of such branches.

The words in square brackets were substituted for a reference to s.32 of this Act by s.3(2) of the Cheques Act 1960.

As to the application of this section to instruments other than cheques: see s.6 of the Cheques Act 1960.

84. "Promissory note" defined-(1) A promissory note is an unconditional promise in writing made by one person to another, signed by the maker, engaging 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.

(.2) An instrument in the form of a note payable to maker's order is not a note within the meaning of this section unless and until it is indorsed by the maker.

(3) A note is not invalid by reason only that it contains also a pledge of collateral security, with authority to sell or dispose thereof.

(4) A note that is, or on the face of it purports to be, both made and payable in the Cook Islands is an inland note; any other note is a foreign note.

85. Delivery necessary-A promissory note is incomplete until delivery thereof to the payee or bearer.

86. Joint and several notes-(1) A promissory note may be made by 2 or more makers, and they may be liable thereon jointly, or jointly and severally, according to its tenor.

(2) Where a note runs "I promise to pay" and is signed by 2 or more persons, it is deemed to be their joint and several note.

87. Note payable on demand-(1) Where a note payable on demand is indorsed, it must be presented for payment within a reasonable time of the indorsement. If it is not so presented, the indorser is discharged.

(2) In determining what is a reasonable time regard shall be had to the nature of the instrument, the usage of trade, and the facts of the particular case.

(3) Where a note payable on demand is negotiated, it is not deemed to be overdue, for the purposes of affecting the holder with defects of title of which he had no notice, by reason that it appears that a reasonable time for presenting it for payment has elapsed since its issue.

88. Presentment of note for payment-( 1 ) Where a promissory note is in the body of it made payable at a particular place, it must be presented for payment at that place in order to render the maker liable; but in any other case presentment for payment is not necessary in order to render the maker liable.

(2) Presentment for payment is necessary in order to render the indorser of a note liable.

(3) Where a note is in the body of it made payable at a particular place presentment at that place is necessary in order to render an indorser liable, but when a place of payment is indicated by way of memorandum only, presentment at that place is sufficient to render the indorser liable, but a presentment to the maker elsewhere, if sufficient in other respects, shall also suffice.

(b) Is precluded from denying to a holder in due course the existence of the payee and his then capacity to indorse.

90. Application of Part I to notes-(1) Subject to the provisions in this Part of this Act, and except as provided by this section the provisions of this Act relating to bills of exchange apply, with the necessary modifications to promissory notes.

(2) In applying those provisions the maker of a note shall be deemed to correspond with the acceptor of a bill, and the first indorser of a note shall be deemed to correspond with the drawer of an accepted bill payable to drawer's order.

(3) The following provisions as to bills do not apply to notes, namely, provisions relating to-

For the liability of the acceptor of a bill, see s.54; for "presentment for acceptance", ss.39-44; for “acceptance", ss.17-19; for "acceptance supra protest", ss.65-68; for "bills in a set", s.71; and for "protest", s.51.

91. Good faith-A thing is deemed to be done in good faith within the meaning of this Act where it is in fact done honestly, whether it is done negligently or not.

92. Signature-(1) Where by this Act any instrument or writing is required to be signed by any person, it is not necessary that he should sign it with his own hand, but it is sufficient if his signature is written thereon by some other person by or under his authority.

(2) Where a corporation makes any instrument or writing required by this Act to be signed. it is sufficient ii the instrument or writing is scaled with the corporate seal.

(3) Nothing in this section shall be construed as requiring the bill or note of a corporation to be under seal.

93. Computation of time-Where by this Act the time limited for doing any act or thing is less than three days in reckoning time non-business days are excluded.....

Words defining non-business days and business days were omitted from this section by s.12(2) of the Statutes Amendment Act 1946.

For definitions of "business day" and "non-business day", see s.12(1) of the Statutes Amendment Act 1946 (reprinted after s.2 of this Act).

94.When noting equivalent to protest-For the purposes of this Act, where a bill or note is required to be protested within a specified time or before some further proceeding is taken, it is sufficient that the bill has been noted for protest before the expiration of the specified time or the taking of the proceeding; and the formal protest may be extended at any time thereafter to take effect from the date of the noting.

95. Protest when notary not accessible-(1) Where a dishonoured bill or note is authorised or required to be protested, and the services of a notary cannot be obtained at the place where the bill is dishonoured, any householder or substantial resident of the place may, in the presence of two witnesses, give a certificate. signed by them, attesting the dishonour of the bill, and the certificate shall in all respects operate as if it were a formal protest of the bill.

(2) The form given in the Second Schedule hereto may be used with necessary modifications, and if used shall be sufficient.

96. Bill drawn at sight to be deemed a bill payable on demand-Every bill of exchange or promissory note drawn and purporting to be payable at sight or on presentation shall be stamped as and shall for all purposes be deemed to be a bill of exchange or promissory note payable on demand without any days of grace, any law or custom to the contrary notwithstanding.

As to the stamping of bills or exchange and other negotiable instruments, see Part VI of the Stamp and Cheque Duties Act 1977

98. Saving-(1) The rules of common law, including the law merchant, save in so far as they are inconsistent with the express provisions of this Act, shall continue to apply to bills of exchange, promissory notes, and cheques.

(a) The provisions of [the Stamp and Cheque Duties Act 1971*], or any law or enactment for the time being in force relating to the revenue:

1883. No. 8-The Bills of Exchange Act 1883.
1884. No. 28-The Bills of Exchange Act 1883 Amendment Act 1884.
No. 40-The Bills of Exchange Act Amendment Act 1905.

Know all men that I, A. B. [householder], of .........., in the Cook Islands, at the request of C. D., there being no notary public available, did on the ..................... day of ............................. 19 ......... , at ......................... , demand payment [or acceptance] of the bill of exchange hereunder written, from E. F., to which demand he made answer [State answer, if any]: Wherefore I now, in the presence of G. H. and J.K., do protest the said bill of exchange.

[N.B.-The bill itself should be annexed, or a copy of the bill and all that is written thereon should be underwritten.]

New Zealand Legislation for Niue

Bills of Exchange Act 1908