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Exception.'

Requisites as to delivery.

When valid delivery

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 a 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 case 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;

But if the bill is in the hands of a holder in due course, a presumed. valid delivery of the bill by all parties prior to him, so as to make them liable to him, is conclusively presumed :

evidence.

Prima facie 3. Where a bill is no longer in the possession of a party who has signed it as drawer, acceptor or indorser, a valid and uncondititional delivery by him is presumed until the contrary is proved.

Capacity of parties.

porations.

Capacity and Authority of Parties.

22. Capacity to incur liability as a party to a bill is coextensive with capacity to contract:

As to cor- Provided, that nothing in this section shall enable a corporation to make itself liable as 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 such corporation :

indorsing

Drawing or 2. Where a bill is drawn or indorsed by an infant, minor, by person or corporation having no capacity or power to incur liability on a bill, the drawing or indorsement entitles the

not com

petent.

CAPACITY AND AUTHORITY OF PARTIES.

holder to receive payment of the bill, and to enforce it against any other party thereto.

13

23. No person is liable as drawer, indorser, or acceptor Signature of a bill who has not signed it as such: Provided that

essential to liability.

tions.

(a) Where a person signs a bill in a trade or assumed Excepname, 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.

unauthor

ture.

24. Subject to the provisions of this Act, where a signa- Forged or ture on a bill is forged or placed thereon without the ized signaauthority of the person whose signature it purports to be, the forged or unauthorized 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:

Provided, that nothing in this section shall affect the Proviso. ratification of an unauthorized signature not amounting to

to payment

indorse

a forgery And provided also, that if a cheque, payable to Proviso: as order, is paid by the drawee upon a forged indorsement out on forged of the funds of the drawer, or is so paid and charged to his ment. account, the drawer shall have no right of action against the drawee for the recovery back of the amount so paid, or no defence to any claim made by the drawee for the amount so paid, as the case may be, unless he gives notice in writing of such forgery to the drawee within one year after he has acquired notice of such forgery; and in case of

hased and

ard Y. Cup.10 б. 1

Procur-
ation sig.

natures.

Person

signing as

represen

tative ca-
pacity.

failure by the drawer to give such notice within the said period, such cheque shall be held to have been paid in due course as respects every other party thereto or named therein, who has not previously instituted proceedings for the protection of his rights. Subsle 2 added alr1891. cap. 17. S.4

25. 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 if the agent in so signing was acting within the actual limits of his authority.

26. Where a person signs a bill as drawer, indorser or agent or in 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 :

Rule for
determin-
ation of
signature.

Valuable
consider-

2. In determining whether a signature on a bill is that of the principal or that of the agent by whose hand it is written, the construction most favorable to the validity of the instrument shall be adopted.

The Consideration for a Bill.

27. Valuable consideration for a bill may be constituted, ation; how by-

constituted

When
holder is

(a) Any consideration sufficient to support a simple contract;

(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, holder for the holder is deemed to be a holder for value as regards

value.

the acceptor and all parties to the bill who became parties prior to such time:

3. Where the holder of a bill has a lien on it, arising As to lien. either from contract or by implication of law, he is deemed

to be a holder for value to the extent of the sum for which he has a lien.

dation

bill.

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

bility.

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

due course.

29. A holder in due course is a holder who has taken a Holder in 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 dishonored, 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:

tive in

fied.

2. In particular, the title of a person who negotiates a Title defecbill is defective within the meaning of this Act when he cases speciobtained 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:

Right of subsequent holder.

Presump

tion of

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. Every party whose signature appears on a bill is value and prima facie deemed to have become a party thereto for value:

good faith.

On whom

burden of

2. And every holder of a bill is prima facie deemed to proof lies. 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 that he is such holder in due course shall be on him, unless and until he proves that, subsequent to the alleged fraud or illegality, value has in good faith been given for the bill. by some other holder in due course :

Usurious consideration.

Consideration con

sisting of

purchase

money of

patent right.

3. No bill, although given for a usurious consideration or upon a usurious contract, is void in the hands of a holder, unless such holder had at the time of its transfer to him, actual knowledge that it was originally given for a usurious consideration, or upon a usurious contract:

4. Every bill or note the consideration of which consists, in whole or in part, of the purchase money of a patent right, or of a partial interest, limited geographically or otherwise, in a patent right, shall have written or printed prominently and legibly across the face thereof, before the same is issued, the words "given for a patent right:" and without such words thereon such instrument and any renewal thereof shall be void, except in the hands of a holder in due course without notice of such consideration.

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