§ 80. shall not have and shall not be capable of giving a better title to the cheque than that which had the person from whom he took it. Imp. Act, s. 81.

Making a cheque "not negotiable" puts it on the same footing as an overdue bill, so that any holder takes it subject to the equities attaching to it, and no person can become a holder in due course. If such a cheque should be lost or stolen the person receiving the money from the collecting bank would be liable in any event.

Where a cheque crossed "not negotiable" was drawn in favor of a firm, and one partner S., in fraud of plaintiff his co-partner indorsed it to defendant, who got it cashed for S., defendant was held liable to the co-partner who under the partnership articles was entitled to the cheque: Fisher v. Roberts, 6 T. L. R. 354 (1890). See National Bank v. Silke, [1891), Q. B. 435.

Protection to collect

81. Where a bank, in good faith and without ing bank. negligence, receives for a customer payment of a cheque crossed generally or specially to itself, and the customer has no title, or a defective title thereto, the bank shall not incur any liability to the true owner of the cheque by reason only of having received such payment. Imp. Act, s. 82.

Section 79 relieves the bank on which the crossed cheque is drawn; this section, the bank which collects it. If it is indorsed "per proc." and the banker makes no inquiry as to the authority to so indorse, this may be negligence: Bissell v. Fox, 53 L. T. N. S. 193; 1 T. L. R. 452 (1885). See Mathiessen v. London & County Bank, 5 C. P. D. 7 (1879); Bennett v. London & County Bank, 2 T. L. R. 765 (1886).

PART IV.

PROMISSORY NOTES.

Only seven sections of the Act, 82 to 88, are devoted specially to promissory notes. As will be seen from section 88, however, most of the provisions of the Act in Part II. relating to bills of exchange, except those connected with their acceptance, apply also to promissory notes.

82. A promissory note is an unconditional Promissory 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. Imp. Act, s. 83 (1).

note

defined.

This definition of a promissory note is an adaptation of that of a bill of exchange, given in section 3, with the necessary modifications.

The definition in the Civil Code, Quebec, is given in Art. 2344 as follows:--"A promissory note is a written promise for the payment of money at all events and without any condition." The French Code de Commerce does not define a note, but, after specifying what articles apply to notes as well as to bills, says, Art. 188:-"A promissory note is dated. It specifies the sum to be paid, the name of the person to the order of whom it is made, the time at which payment must be made, the value furnished in money, goods, account, or otherwise."

§ 82.

The definition makes no change in the law as to what is a promissory note, except that in Nova Scotia and New Brunswick notes payable otherwise than in money, which, under provincial Acts, were, in certain respects, placed on the same footing as promissory notes payable in money, and were generally called promissory notes, will no longer be so considered. A note payable to a specified person and not to his order, or to bearer, was considered a promissory note before the Act but was not negotiable. It is now negotiable: sections 8 and 88.

"Unconditional promise."-The maker of a note is deemed to correspond with the acceptor of a bill: section 88. A bill is an unconditional order, but the acceptance may be conditional: section 19. There is consequently this difference, that while the undertaking of the acceptor may be only conditional, that of the maker of a note is unconditional, and corresponds with the position of an unconditional acceptor.

"In writing."-As to what is a writing, see p. 36.

"One person to another."-While there are three parties to a bill of exchange, the drawer, the drawee, and the payee, there are only two necessary parties to a promissory note, the maker and the payee.

Signed."-As to what is a signature under the Act, see pp. 39 to 41. Where a person signs, as agent or in a representative character, it is often a matter of dispute. whether he is personally liable. See pp. 160 to 166.

"On Demand" etc.-A note is payable on demand which is expressed to be so payable, or in which no time for payment is expressed: sections 10 and 88. A note is payable at a fixed or determinable future time which is expressed to be payable at a fixed period after date, or on or at a fixed period after the occurrence of a specified event which

is certain to happen, though the time of happening is § 82. uncertain sections 11 and 88. See notes and illustrations. under the former of these sections.

"A sum certain in money."-See pp. 41 to 45; also section 9 and the notes and illustrations thereunder.

"Specified person. "-The person to whom or to whose order a note is made payable is called the payee. If the note is not payable to bearer, he should be named or otherwise indicated with reasonable certainty: section 7. See p. 45.

"" Bearer."-Most of the companies incorporated under Imperial, Dominion or Provincial Charters are prohibited from issuing a note payable to bearer. See pp. 131 to 136; also 54 Vict. c. 35 (Que). All persons except chartered banks are prohibited under a penalty of $400 from issuing notes payable to bearer, intended to circulate as money: Bank Act, 53 Vict. c. 31, s. 60.

No particular form of words is required to constitute a valid note, provided the instrument meet the requirements of the definition: Hall v. Bradbury, 1 Rev. de Leg. 180 (1845); Hooper v. Williams, 2 Ex. at p. 20 (1848). But a promissory note, as between the original parties at least, is something which they intend to be a promissory note: Sibree v. Tripp, 15 M. & W. at p. 29 (1846). If an instrument is ambiguous and it is uncertain whether it was meant to be a bill or note, the holder may treat it as either at his option: Edis v. Bury, 6 B. & C. 433 (1827); Fielder v. Marshall, 9 C. B. N. S. 606 (1861). The construction most favorable to the validity of the instrument will be adopted: Mare v. Charles, 5 E. & B. at p. 981 (1856).

If an instrument is in the form of a bill, and the drawer and the drawee are the same person, or the drawee is a fictitious person or one not having capacity to contract, it may be treated as a note by the holder: section 5, s-s. 2.

§ 82.

ILLUSTRATIONS.

See illustrations ante pp. 42, 47, 48, 60 61, 77 and 84. The following instruments have been held not to be valid promissory notes:

1. "Three months after date, pay to the order of T. £228, for value received." Held not to be a note, for want of a promise, and not a bill, because addressed to no drawee: Forward v. Thompson, 12 U. C. Q. B. 103 (1855).

2. An instrument in the form of a note but under the seal of the maker: Wilson v. Gates, 16 U. C. Q. B. 278 (1858).

3. An instrument in the form of a note payable to bearer, but with a condition: Campbell v. McKinnon, 18 U. C. Q. B. 612 (1859).

4. "Four months after date I promise to pay to W. H. or order $1,264, value received. This note to be held as collateral security. S. J. M.": Hall v. Merrick, 40 U. C. Q. B. 566 (1877); Sutherland v. Patterson, 4 O. R. 565 (1884).

5. A letter acknowledging receipt of money "as a loan, subject to be returned when demanded, with interest": Whishaw v. Gilmour, 6 L. C. J. 319 (1862).

6. A receipt in the following form:-" Received from Mrs. A. a loan of $800, to be returned when required": DeSola v. Ascher, 17 R. L. 315 (1889).

The following have been held to be valid notes :—

7. A church subscription list held to be the several note of each subscriber for the sum opposite his name: Thomas v. Grace, 15 U. C. C. P. 462 (1865).

8. A promise to pay in cash or goods at the option of the holder: McDonnell v. Holgate, 2 Rev. de Leg. 29 (1821); Hosstatter v. Wilson, 31 Barb. (N.Y.) 307 (1862); Dinsmore v. Duncan, 57 N. Y. at p. 573 (1874).

9. An obligation before a notary to pay a certain sum of money without condition: Aurele v. Durocher, 5 R. L. 165 (1878).