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under which it was given: Dumas v. Baxter, 14 R. L. 496 § 30. (1885).
11. Where defendant's signature was obtained to a note by fraud, under circumstances which were matter of public notoriety when the note was transferred to B., for whom plaintiff is suing on the note, it must be proved that B. gave value : Exchange Bank v. Carle, M. L. R. 3 Q. B. 61; 31 L. C. J. 90 (1887).
12. The holder of a note sues the maker. It is proved that it was given for an illegal consideration. Plaintiff must prove that he gave value: Bailey v. Bidwell, 13 M. & W. 73 (1844).
13. The indorsee of a note sues the maker, who proves that it was given for a wager, which is a consideration void by statute, but not prohibited under a penalty. Plaintiff is not obliged to prove that he gave value: Fitch v. Jones, 5 E. & B. 238 (1855).
14. A firm sued as acceptors prove that it was signed by one partner for a private debt in fraud of the others. Plaintiff must prove that he is a holder for value: Hogg v. Skeen, 18 C. B. N. S. 426 (1865).
15. The owner of a negotiable instrument which has been stolen has no title to it against a bona fide holder for value, although he has prosecuted the thief to conviction: Chichester v. Hill, 52 L. J. Q. B. 160 (1882).
16. Where authority was given to fill in the name of a firm as drawers of a bill, and a partner filled in his own name as drawer and accepted the bill in the firm name in fraud of the partnership, the latter was held not liable, as the holder had not exercised due care and did not prove that he had given value in good faith Oakley v. Boulton, 5 T. L. R. 60 (1888).
17. Where there was evidence that the acceptor of a bill had handed it to L. to get it discounted for him, but instead of doing so, L. had fraudulently handed it to the drawer who negotiated it, the burden of proof is on the holder to prove both that value had been given, and that it had been given in good faith without notice of the fraud: Tatam v. Haslar, 23 Q. B. D. 345 (1889).
18. Sub-section 2 of section 30 of the Imperial Act, does not affect or vary the practice of the Chancery Division in dealing with an application for an injunction to restrain the negotiation of a bill of exchange, and an acceptor or holder who applies for an injunction in such a case, even though he alleges fraud, muststill be prepared, as formerly, to pay the amount of the bill into court or give security: Hawkins v. Ward, W. N. Nov. 29th, 1890, p. 203. The sub-section relates to the proceedings at a. trial, and the shifting of the burden of proof after evidence has been given of fraud, etc: Hawkins v. Troup, 7 T. L. R. 104 (1890).
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:
The Imperial Act does not contain any provision similar to this, which is taken in substance from R. S. C. c. 123, s. 17, where however it applied to Ontario alone, having been enacted for Upper Canada when the usury laws were in force there, and not having been repealed before the present Act. There was a similar provision for Quebec in Art. 2335 of the Civil Code. It is now practically obsolete in Canada. The Act, 53 Vict. c. 34, s. 2, which immediately follows the present one in the statutes of 1890, and which came into force on the day of its assent, May 16th, 1890, repealed all the subsisting usury laws, which remained in force from old provincial enactments, and which were embodied in the Revised Statutes of Canada as chapter 127, with varying provisions applicable to the provinces of Ontario, Quebec, Nova Scotia and New Brunswick respectively. Now any individual or corporation, in the absence of some special statutory prohibition, may stipulate for, allow, and exact, on
bills and notes, or on any other contract or agreement any § 30. rate of interest or discount which is agreed upon: R. S. C. c. 127, s. 1. By sections 80 and 81 of the Bank Act, 53 Vict. c. 31, chartered banks are not allowed to take more than seven per cent. They do not however incur any penalty or forfeiture for usury.
The clause would protect the holder in Canada of a foreign bill, which might have been void for violation of the foreign usury laws. It will be observed that it is not merely a holder in due course, or even a holder for value that is protected; but any holder who had not at the time of the transfer to him of the bill, actual knowledge of the illegality.
4. Every bill or note the consideration of which For a consists in whole or in part, of the purchase money right. 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:
5. The indorsee or other transferee of any such Liability of instrument having the words aforesaid so printed or written thereon, shall take the same subject to any defence or set-off in respect of the whole or any part thereof which would have existed between the original parties:
6. Every one who issues, sells or transfers, by indorsement or delivery, any such instrument not having the words "given for a patent right" printed or written in manner aforesaid across the face thereof, knowing the consideration of such instrument to have consisted, 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, is guilty of a misdemeanor, and liable to imprisonment for any term not exceeding one year, or to such fine, not exceeding two hundred dollars, as the court thinks fit. R. S. C. c. 123, ss. 12, 13, 14.
These provisions are not in the Imperial Act and were not in the bill as introduced into the House of Commons, but were reluctantly inserted by the Minister of Justice at the urgent request of certain members of that House: Commons Debates, 1890, pp. 105, 1415 and 1520. The first Canadian statute on the subject was passed in 1884, 47 Vict. c. 38, and embodied the above clauses, with the exception of that part of sub-section 4, following the words
given for a patent right," which declare that any such bill or note not hearing the prescribed words, and any renewal thereof, shall be void, except in the hands of a holder in due course without notice of such consideration. These words were added to the clause to override the interpretation placed upon the original Act as embodied in R. S. C. c. 123, by the Ontario Common Pleas Divisional Court in the case of Girvin v. Burke, 19 O. R. 204 (1890), a decision which was rendered while the Bill was before Parliament: Senate Debates, 1890, p. 465. In that case it was held, that the omission of the prescribed words in a
note or renewal note did not render it void as between the $ 30. maker and the payee, and that the intention of the Act was to give the indorsee or transferee notice, and to put him in the position of the payee as to any defence which the maker might have against a claim by the payee. In this the Court followed a decision in Pennsylvania on a similar statute: Haskell v. Jones, 86 Penn. St. 173 (1878); where Chief Justice Sharswood said: "By the express provision of the statute the only effect of the insertion of such words, is that such note or instrument in the hands of the purchaser or holder, shall be subject to the same defences as if in the hands of the original owner or holder."
Under a statute on this subject where the rights of a holder in due course were not in express terms protected, as they are in our Canadian Act, it was held that if the patent right consideration were not expressed in the note, a bona fide holder would be protected according to the general principles of the law merchant: Palmer v. Minar, 8 Hun (N. Y.) 342 (1876).
The general purpose of the Act is to restrict its provisions to the civil rights and remedies relating to bills and notes. This is adhered to in every other section, and provisions for the punishment of the forgery of bills and other frauds in connection with them, have not been inserted in the Act, but are to be found among the criminal statutes. Sub-section 6 is the only exception to this rule. This led to the further anomaly of the insertion of the word "note" in this part of the Act which relates to bills of exchange, instead of leaving it to the operation of section 88, as it was not thought desirable to leave a criminal offence to implication, or the operation of incidental legislation: Senate Debates, 1890, p. 464.