§ 71. law of the place of the contract, and that of the place where the bill is payable.

The enactment of clauses (c) and (e) of this section relating to presentment, protest and the due date of bills, apparently as exceptions to the rule in the present clause, would seem to suggest that in other respects the law of the place of contract is to govern.

A literal rendering of the present clause taken in connection with the introductory clause of the section would scarcely seem to cover the case of a promissory note made in one place and payable in another, but section 88 may be wide enough to authorize the necessary modifications.

ILLUSTRATIONS.

1. Where a note made and payable in Quebec was sued upon in Ontario, and a defence of no consideration valid in Ontario was set up, plaintiff who simply joined issued could not show that the consideration was valid by the law of Quebec. He should have replied that it was governed by Quebec law and have proved it like any other fact: Hope v. Caldwell, 21 U. C. C. P. 241 (1871); Robertson v. Caldwell, 31 U. C. Q. B. 402 (1871). See Benham v. Lord Mornington, 3 C. B. 133 (1846).

2. A note payable in the State of New York was signed by a firm and indorsed there by one of the partners and by two other persons for the accommodation of the firm. It was then taken by another partner to Canada and negotiated there. Held, that it was a Canada contract: Cloyes v. Chapman, 27 U. C. C. P. 22 (1876). See also Gay v. Rainey, 89 Ill. 221 (1878); Bell v. Packard, 69 Me. 105 (1879).

3. Defendant, domiciled in Ontario, while in New York, drew a bill in favor of plaintiff upon a person in Ontario, who refused acceptance. Defendant, by drawing the bill, in effect guaranteed its acceptance and payment in Ontario, and in default, agreed to re-imburse the holder at New York, so that his contract was governed by the law of New York: Story v.

McKay, 15 O. R. 169 (1888); Potter v. Brown, 5 East, 124 § 71. (1804); Hicks v. Brown, 12 Johns. (N.Y.) 142 (1815); Powers v. Lynch, 3 Mass. 77 (1807); Prentiss v. Savage, 13 Mass. 20 (1816.)

4. A resident of Halifax while in Paris made a note for the accommodation of the payee and sent it to him at Halifax where the payee negotiated it. Held, that the liability of the maker was governed by the law of Nova Scotia and not by that of France Merchants' Bank v. Stirling, 13 N. S. (1 R. & G.) 439 (1880).

5. A bill was drawn in London upon a drawee in Leghorn who accepted. By the law of Leghorn if an acceptor has not sufficient funds of the drawer's in his hands, and the latter fails, the acceptance is vacated. It was held that the liability of the acceptor was to be determined by the law of Leghorn: Burrows v. Jemino, 2 Stra. 733 (1726).

6. A bill drawn in Belgium is indorsed in France. Held, that such indorsement is to be interpreted by the law of France: Trimbey v. Vignier, 1 Bing. N. C. 151 (1834); Bradlaugh v. DeRin, L. R. 3 C. P. 538 (1868).

7. A general acceptance given in Paris is to be interpreted by the law of France: Don v. Lippmann, 5 Cl. & F. at pp. 12, 13 (1837).

8. If a bill drawn in one country and payable in another is dishonored, the drawer is liable according to the law of the place where the bill was issued and not where it was payable: Allen v. Kemble, 6 Moore P. C. 314 (1848).

9. A bill drawn in California upon Washington is dishonored. The drawer is liable for interest at the rate in California: Gibbs v. Fremont, 9 Ex. 25 (1853).

10. A bill drawn in England upon a person in Spain is indorsed in Spain. Such indorsement must be construed by the law of Spain: per Brett, L.J., in Horne v. Rouquette, 3 Q. B. D. at p. 520 (1878).

11. Bills drawn and indorsed in England and payable in Milan are dishonored. The Milan holder sues the drawer and

§ 71. indorsers in England. They plead that the bills are Italian and by the law of Italy plaintiff's remedy is lost because no action was taken within 15 days after protest. Held to be no defence in England: Cassanova v. Meier, 1 T. L. R. 245 (1885).

Indorsement of

12. A note was signed and issued in Belgium. In an action by the indorsee against the maker, Belgian experts were exam. ined as to whether the note was negotiable by Belgian law. The jury said they could not decide whether it was or not. This was held to be equivalent to a finding that the law of Belgium was not proved, and the note being negotiable by English law it was assumed that it would be by Belgian law, and judgment given in favor of plaintiff: Nouvelle Banque de l'Union v. Ayton, 7 T. L. R. 377 (1891).

13. An inland English note payable to bearer, and overdue, was sold by judicial sale in Norway. By Norwegian law the transferee of an overdue note in good faith takes it free from equities. Held, that the transfer was governed by Norwegian law and defendant could not set up the equities attaching to the note which he had against the person who held it at maturity: Alcock v. Smith, 8 T. L. R. 222; W. N. 1892, p. 4; to appear in L. R. [1892] 1 Q. B.

Provided, that where an inland bill is indorsed inland bill. in a foreign country, the indorsement shall, as regards the payer, be interpreted according to the law of Canada. Imp. Act, s. 72 (2).

Before the Imperial Act of 1882 the principle of this proviso was recognized in both England and Scotland, not only as to indorsement, but also as to transfer by delivery.

ILLUSTRATIONS.

1. A promissory note, made and payble in England to bearer, is transferred by delivery in France where such transfer gives no title. Held, that the holder can recover: De la Chaumette v. Bank of England, 2 B. & Ad. 385 (1831).

2. A note made and payable in Scotland in favor of a person § 71. and not to his order or bearer being negotiable by the law of Scotland, was indorsed in England, when such a bill was not negotiable there. Held, that it was a valid negotiation: Robertson v. Bendekin, 1 Ross, Scotch L. C. 824 (1843).

3. A bill of exchange was drawn, accepted and payable in England. It was indorsed in France in proper English form, but in one which would not by French law give the indorser the right to sue in his own name. Held, that the indorsee could recover from the acceptor in England: Lebel v. Tucker, L. R. 3 Q. B. 77 (1867).

holder.

(c) The duties of the holder with respect to Duties of presentment for acceptance or payment and the necessity for or sufficiency of a protest or notice of dishonor, or otherwise, are determined by the law of the place where the act is done or the bill is dishonored. Imp. Act, s. 72 (3).

This is one of the provisions to which the rule laid down in clause (b) ante is subject.

ILLUSTRATIONS.

1. A bill is payable in Buffalo. Presentment, etc., are governed by the law in force there. In the absence of proof of that law, it will be presumed to be the same as here, and no presentment being proved or notice of dishonor, drawer and indorsers are not liable: Buffalo Bank v. Truscott, 1 Rob. & Jos. Dig. 495 (1838). See Howard v. Sabourin, 5 L. C. R. 45 (1854); Allen v. McNaughton 9 N. B. (4 Allen) 234 (1858).

2. Defendant indorsed in England to plaintiff a bill payable in Paris. Plaintiff indorsed to a Frenchman, who, on dishonor, had the bill protested and defendant notified according to French law. Held, that defendant was duly notified and was liable to plaintiff: Hirschfield v. Smith, L. R. 1 C. P. 340 (1866); Rothschild v. Currie, 1 Q. B. 43 (1841).

§ 71.

Bill in foreign currency.

3. A bill drawn in England and payable in Spain is indorsed in England by defendant to plaintiff, who indorses it to M. in Spain. It is dishonored by non-acceptance, and twelve days later M. notifies plaintiff, who at once notifies defendant. The law of Spain does not require notice of non-acceptance. Defendant is liable to plaintiff: Horne v. Rouquette, 3 Q. B. D. 514 (1878).

(d.) Where a bill is drawn out of but payable in Canada, and the sum payable is not expressed in the currency of Canada, 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 payable. Imp. Act, s. 72 (4).

This is the rule applied to the case of bills dishonored abroad section 57 (3) (b.). And the same rule governs where bills payable abroad in a foreign currency are sued upon in Canada. The holder is entitled to recover the amount according to the rate of exchange on the day of maturity or dishonor with interest thereon.

Due date. (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. Imp. Act, s. 72 (5).

This is one of the provisions to which the rule laid down in clause (b) ante, is subject.

ILLUSTRATIONS.

1. A note drawn in Montreal was made payable in New York. The third day of grace fell on Sunday. The note was protested on Saturday in accordance with the law of New York.