negotiable,” is stolen. The thief then gets a tradesman to cash it for him, and the tradesman gets the cheque paid on presentment through his banker. The banker who pays and the banker who receives the money for the tradesman are protected, but the tradesman would be liable to refund the money to the true owner. Again, assuming payment of the cheque to have been stopped, the tradesman could not maintain an action against the drawer.
A promissory note is defined by section 83 of the act to be 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, Promissory notes. a sum certain in money to or to the order of a specified person or to bearer.” A promissory note may be made by two or more makers, and they may be liable either jointly, or jointly and severally, according to its tenor (§ 85). For the most part, rules of law applicable to a bill of exchange apply also to a promissory note, but they require adaptation. A note differs from a bill in this: it is a direct promise to pay, and not an order to pay. When it issues it bears on it the engagement of the principal debtor who is primarily liable thereon. The formula for applying to notes the rules as to bills is that “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 a bill payable to drawer’s order” (§ 89). Rules relating to presentment for acceptance, acceptance, acceptance supra protest, and bills in a set, have no application to a note. Moreover, when a foreign note is dishonoured it is not necessary, for English purposes, to protest it. All promissory notes are, under the Stamp Act 1891, subject to an ad valorem stamp duty. Inland notes must be on impressed stamp paper. Foreign notes are stamped with adhesive stamps. For ordinary legal purposes a bank note may be regarded as a promissory note made by a banker payable to bearer on demand. It is, however, subject to special stamp regulations. It is not discharged by payment, but may be re-issued again and again. In the interests of the currency the issue of bank notes is subject to various statutory restrictions. A bank, other than the Bank of England, may not issue notes in England unless it had a lawful note issue in 1844. On the other hand, Bank of England notes are legal tender except by the bank itself.
In fundamental principles there is general agreement between the laws of all commercial nations regarding negotiable instruments. As Mr Justice Story, the great American lawyer, says: “The law respecting negotiable instruments Foreign laws. may be truly declared, in the language of Cicero, to be in a great measure not the law of a single country only, but of the whole commercial world. Non erit lex alia Romae, alia Athenis, alia nunc alia posthac, sed et apud omnes gentes et omni tempore, una eademque lex obtinebit” (Swift v. Tyson, 16 Peters i). But in matters of detail each nation has impressed its individuality on its own system. The English law has been summarized above. Perhaps its special characteristics may be best brought out by comparing it with the French code and noting some salient divergences. English law has been developed gradually by judicial decision founded on trade custom. French law was codified in the 17th century by the “Ordonnance de 1673.” The existing “Code de Commerce” amplifies but substantially adopts the provisions of the “Ordonnance.” The growth of French law was thus arrested at an early period of its development. The result is instructive. A reference to Marius’ treatise on bills of exchange, published about 1670, or Beawes’ Lex Mercatoria, published about 1740, shows that the law, or rather the practice, as to bills of exchange was even then fairly well defined. Comparing the practice of that time with the law as it now stands, it will be seen that it has been modified in some important respects. For the most part, where English law differs from French law, the latter is in strict accordance with the rules laid down by Beawes. The fact is that, when Beawes wrote, the law or practice of both nations on this subject was nearly uniform. But English law has gone on growing while French law has stood still. A bill of exchange in its origin was an instrument by which a trade debt due in one place was transferred to another place. This theory French law rigidly keeps in view. In England bills have developed into a paper currency of perfect flexibility. In France a bill represents a trade transaction; in England it is merely an instrument of credit. English law affords full play to the system of accommodation paper; French law endeavours to stamp it out. A comparison of some of the main points of difference between English and French law will show how the two theories work. In England it is no longer necessary to express on a bill that value has been given for it, for the law raises a presumption to that effect. In France the nature of the consideration must be stated, and a false statement of value avoids the bill in the hands of all parties with notice. In England a bill may be drawn and payable in the same place. In France the place where a bill is drawn should be so far distant from the place where it is payable that there may be a possible rate of exchange between the two. This so-called rule of distantia loci is said to be disregarded now in practice, but the code is unaltered. As French lawyers put it, a bill of exchange necessarily presupposes a contract of exchange. In England since 1765 a bill may be drawn payable to bearer, though formerly it was otherwise. In France it must be payable to order; if it were not so it is clear that the rule requiring the consideration to be truly stated would be a nullity. In England a bill originally payable to order becomes payable to bearer when indorsed in blank. In France an indorsement in blank merely operates as a procuration. An indorsement, to operate as a negotiation, must be to order, and must state the consideration; in short, it must conform to the conditions of an original draft. In England, if a bill is dishonoured by non-acceptance, a right of action at once accrues to the holder. In France no cause of action arises unless the bill is again dishonoured at maturity; the holder in the meantime is only entitled to demand security from the drawer and indorsers. In England a sharp distinction is drawn between current and overdue bills. In France no such distinction is drawn. In England no protest is required in the case of the dishonour of an inland bill, notice of dishonour being sufficient. In France every dishonoured bill must be protested. Opinions may differ whether the English or the French system is better calculated to serve sound commerce and promote a healthy commercial morality. But an argument in favour of the English system may be derived from the fact that as the various continental codes are from time to time revised and re-enacted, they tend to depart from the French model and to approximate to the English rule. The effect upon English law of its codification has yet to be proved. A common objection to codification in England is that it deprives the law of its elastic character. But when principles are once settled common law has very little elasticity. On the other hand no code is final. Modern parliaments legislate very freely, and it is a much simpler task to alter statute law than to alter common law. Moreover, legislation is cheaper than litigation. One consequence of the codification of the English law relating to bills is clear gain. Nearly all the British colonies have adopted the act, and where countries are so closely connected as England and her colonies, it is an obvious advantage that their mercantile transactions should be governed by one and the same law expressed in the same words.
The ordinary text-books on the law of bills of exchange are constantly re-edited and brought up to date. The following among others may be consulted:—Byles, Bills of Exchange; Chalmers, Bills of Exchange; Daniel, Law of Negotiable Instruments (United States); Nouguier, Des lettres de change et des effets de commerce (France); Thorburn, Bills of Exchange Act 1882 (Scotland); Story, Bills of Exchange (United States); Hodgins, Bills of Exchange Act 1890 (Canada).
BILL OF RIGHTS, an important statute in English constitutional history. On the 13th of February 1689 the Declaration of Right, a document drawn up by a committee of the commons, and embodying the fundamental principles of the constitution, was delivered by the lords and commons to the prince and princess of Orange, afterwards William III. and Mary. In