Sect. 2. Of his creditor, give him his acceptance in discharge of the debt, he may payment;& afterwards pay such acceptance to the holder of the bill, although beto whom it tween the time when he accepted and the time when the bill became may be due, he heard of the bankruptcy; the giving, indorsing, or accepting a 1st, by and made: bill of exchange, being considered as an immediate payment within the meaning of the statute of James, which protects bona fide payments made to a bankrupt, provided the bill be honoured when due. So also a payment made by a bankrupt to a person not having notice of the bankruptcy or insolvency, and being a bona fide creditor for [ 283 goods sold, or by the bankrupt's having drawn, negotiated, or accepted a bill of exchange in the usual or ordinary course of trade and dealing, is protected by the statute 19 Geo. 2. c. 32. We have already considered some of the decisions upon this act. It has been doubted whether promissory notes, or checks on bankers, are within this act.1 It has been held, that payment of a bill to a creditor by a bankrupt under an arrest, after a secret act of bankruptcy, is a payment in the course of trade; but if the payment be intended as a fraudulent preference it will not be valid." If the holder of a bill give time to the acceptor, upon condition that he should allow interest, and he afterwards pay the bill, having previously committed a secret act of bankruptcy, this is not a payment in the usual course of trade within the meaning of the statute. So where A. having recovered a verdict against B who afterwards committed an act of bankruptcy, and A. net having had notice thereof, took a bill drawn by B. on C. for the amount of the sum recovered, payable at a distant period, which bill was afterwards paid: it was determined that this payment was not protected by the statute, and consequently that A. was liable to refund the money received by him to the assignees of B. And where bankers having accepted a bill for the accommodation of a trader, he, after committing an act of bankruptcy, but before a commission is sued out, lodged money with them to take up the bills, which do not become due till after a commission is sued out, and are then regularly paid by the acceptors, it was held, that they were bound to refund the money to the assignees, [284 and that they neither had a right of set-off under 5 Geo. 2. c. 30., nor could protect themselves under 19 Geo. 2. c. 32. as having received the & Wilkins 9. Casey, 7 T. R. 711. Ante, 119. Bayl. 143; and see Foxcraft v. Devonshire, 1 Bla. Rep. 193. 3 Campb. 186. b By this statute it is enacted, "that no person who is or shall be really and bona fide a creditor of any bankrupt, for or in respect of goods, really and bona fide sold to such bankrupt, or for or in respect of any bill or bills of exchange really and bona fide drawn, negotiated, or accepted by such bankrupt, in the usual or ordinary course of trade and dealing, shall be liable to refund or repay to the assignee or assignees of such bankrupt's estate, any money which before the suing forth of such commission was really and bona fide, and in the usual and ordinary course of trade and dealing, received by such person of any such bankrupt before such time as the person receiving the same shall know, understand, or have notice, that he is become a bankrupt, or that he is in insolvent circumstances." See also 46 Geo. 3. c. 135, post, 284. In Harwood v. Lomas, 11 East, 131, it was doubted whether payments of promissory notes are within this act. Ante, 117 to 120. Harwood v. Lomas, 11 East, 131. Holroyd v. Whitehead, 5 Taunt. 444. 1 Marsh. 128. Cox v. Morgan, 2 Bos. & Pul. 398. Ex parte Farr, 9 Ves. 515. Sed vide Southey v. Butler, 3 Bos. & Pul. 237; but see Blogg v. Phillips, 2 Campb. 129. Cullen, 238, 239. Bayly v. Schofield, 1 M. & S. 388. "Singleton v. Butler, 2 Bos. & Pul. 283. Southey v. Butler, 3 Bos. & Pul. 237. Vernon v. Hall, 2 T. R. 648.; and see 1 Montg. 311, 312, 313. 2 Ves. 550. Cullen, 234. P Pinkerton v. Marshall, 2 Hen. Bla. 334. Tamplin and others assignees of Visich, a bankrupt v. Diggins and others, 2 Campb. 312. be money in payment of bills of exchange in the ordinary course of trade. Sect. 2. Of And where bankers, after a secret act of bankruptcy of the acceptor, payment;& 1st, by and paid a bill for him, accepted payable at their house, and he afterwards to whom it remitted the money to them, it was decided that they were liable to re-may fund; because the bankrupt was not liable to them on the bill, and his made. re-payment to them was only in satisfaction of a loan, which is not a payment protected by the statute. So if bankers pay a check drawn upon them by a trader after a secret act of bankruptcy, they cannot retain money received to cover such check. So it has been decided, that the assignees of a bankrupt are entitled to recover back money paid by the bankrupt to the defendant after a secret act of bankruptcy, (though before the date of the commission,) which the defendant had before recovered by judgment against the bankrupt in an action on a promissory note, reserving interest half yearly given for the balance of an account among other things consisting of money lent, such note not being given in the usual and ordinary course of dealing, so as to be protected by 19 Geo. 2. c. 32., even supposing a promissory note to be within that statute, which only mentions, bills of exchange. However, by the 46 Geo. 3. c. 135. s. 1, 2., it was enacted, that, "in all cases of commissions of bankrupt thereafter to be issued, all conveyances by, all payments by and to, and all contracts and other dealings and transactions by and with any bankrupt bona fide made or entered into more than two calendar months before the date of such commission, shall, notwithstanding any prior act of bankruptcy committed by such bankrupt, be good and effectual to all intents and purposes whatsoever, in like manner as if no such prior act of bankruptcy had been committed, provided the person or persons so dealing with such bankrupt had not at the time of such conveyance, payment, contract, dealing, or transaction, any notice of any prior act of bankruptcy by such bankrupt committed, or that he was insolvent or had stopped payment," and that all and every person and persons with whom the bankrupt shall have really and bona fide contracted any debt or debts before the date and suing forth of such commission, which if contracted before any act of bankruptcy committed, might have been proved under such commission, shall, notwithstanding any prior act of bankruptcy may have been committed by the bankrupt, be admitted to prove such debt or debts, [285] and to stand and be a creditor under such commission to all intents and purposes whatever, in like manner as if no such prior act of bankruptcy had been committed by such bankrupt, provided such creditor or creditors had not, at the time of such debt or debts being contracted, any notice of any prior act of bankruptcy committed." Since this act, the statute 19 Geo. 2. c. 32, can only come in question where the payment is made within two months before the suing out of the commission. We have already seen that a bill or check should not be prematurely 2dly. Withpaid; Marius gives particular directions on this point. The general in what Holroyd v. Whitehead, 8 Campb. 530. 533. 2 Rose, 145. 5 Taunt. 444. 1 Marsh. 128. S. C. Id. ibid. Harwood v. Lomas, 11 East, 127. Ante, 283. As to the construction of these words, see ante, 120. * 2 Campb. 315, in note. Ante, 148. Bayl. 145, 6. 2 Marius, 4th edit. 31. time pay ment must be made. time pay ment must 2lly. With rule with respect to the time allowed for the payment of money, when in what a day certain is appointed, is, that the party bound has till the last moment of the day to pay it ; but it is otherwise with respect to be made. foreign bills, for as the protest for non-payment of them should be made on the last day of grace," so as to be sent if possible by the post on that day, it follows that the holder may insist on payment on demand, or at least before the hours of business are expired. d With respect to inland bills it has been much discussed whether the acceptor has not the whole day for payment. On the one hand a bill of exchange has been assimilated to other contracts, in which the party has till the last instant of the day to pay the same: but on the other hand, it has been urged, that the contract of an acceptor of a bill, or maker of a note, is to pay on demand on the appointed day, and that if payment be not made on such demand, the contract is broken: and the holder may treat the bill or note as dishonoured. The latter doctrine appears now to be established; and, therefore, where the acceptor having said at eleven o'clock in the day that he would not pay the bill, it was decided that the holder might immediately resort to the drawer, so that notice of the dishonour may be given on the same day. It is [286]not usual or necessay to give notice of non-payment before the following morning, and therefore there can be no objection to the allowance of the whole day on which the bill becomes due, to pay it in. At all events, if the holder make a second presentment on the last day of grace, the acceptor may insist on paying it when such presentment is made, without paying the fees of noting or protesting, notwithstanding such presentment be made after banking-hours, and expressly for the purpose of noting and protesting. But in a late case it was decided, that a plea of a tender made after the day of payment of a bill of ex a Hudson v. Barton, 1 Rol. Rep. 189. 1 Saund. 288, n. 17. Leftley v. Mills, 4 T. R. 173. b Tassel v. Lee, 1 Ld. Raym, 743, et post, sed quære, see Vin. Abr. tit. Time, A. 2. pl. 3. Anon. Lutw. 1593. Colkett v. Freeman, 2 T. R. 61. Parker v. Gordon, 7 East, 385. 3 Smith's Rep. 358. S. C. d Leftley v. Mills, 4 T. R. 170. arguments of Kenyon, C. J. and Buller, J. disputed by Lord Alvanley, C. J. in Haynes v. Birks, 3 Bos. & Pul. 602. Ex parte Moline, 1 Rose, 303. Burbridge v. Manners, 3 Campb. 193. Hume v. Peploe, 8 East, 169. Ex parte Moline, 1 Rose, 308. In this case the point was, the acceptor having said at eleven o'clock in the day that he would not pay the bill, whether the holder could immediately resort to the drawer? The Lord Chancellor was of opinion that he could. Sir Samuel Romilly mentioned Burbridge v. Manners, 3 Campb. 194, S. P. Burbridge v. Manners, 3 Campb. 193. This was an action on a promissory note for 101. 15s. 5d. dated 11th October, 1810, drawn by J. Finney, payable three months after date, at Fraser and Co's. to the defendant, indorsed by him to one Tinson, and by Tinson to the plaintiff. The note was regularly presented for pay ment in the forenoon of the day it became due, when payment was refused, and in the afternoon of the same day the plaintiff caused notice of its dishonour to be sent to the defendant. Park, for the defendant, objected that this was not sufficient notice of the dishonour. Finney, the maker of the note, had the whole of the day it became due to pay it, and till the last minute of that day it could not be considered as dishonoured. The notice therefore stated what was untrue, and was evidently premature. Per Lord Ellenborough. I think the note was dishonoured as soon as the maker had refused payment on the day when it became due, and the notice sent to the defendant must have answered all the purposes for which notice in such cases in required. The holder of a bill or note gives notice of its dis honour in reasonable time the day after it is due, but he may give such notice as soon as it has been dishonoured, the day it becomes due; and the other party can not complain of the extraordinary diligence used to give him information. Verdect for the plaintiff. f Leftley v. Mills, 4 T. R. 170. Vin. Ab. tit. Time, A. 2. pl. 3. Haynes v. Birks, 8 Bos. & Pul. 599. 8 Leftley v. Mills, 4 T. R. 170. Poth. pl. 140. 174; see post, as to protest for non-payment. what time pay change, and before action brought, is insufficient, although the plea 2dly. Withaverred that the defendant was always ready to pay from the time of in the tender, and that the sum tendered was the whole money then due, ment must owing, or payable to the plaintiff in respect of the bill, with interest be made. from the time of the default, for the damages sustained by the plaintiff by reason of the non-performance of the promise. However, a drawer or indorser may tender within a reasonable time after notice, as it is not to be expected that he is to be ready at the instant he receives notice to pay the amount. If a promissory note of twenty years date be unaccounted for, it affords a presumption of payment.< a mounts to When a bill is drawn here, and payable in a foreign country in зdly. Payforeign coin, the value of which is reduced by the government of that ment how country, it is said that the bill shall be payable according to the value of made, and the money at the time it was drawn. But though a war between this what and a foreign country may in some cases excuse the obligation on a jt. British subject to pay a bill in such foreign country," yet we have seen,[ 287 1 that where a note was made payable in Paris, or at the choice of the bearer in England, according to the course of exchange upon Paris, it was holden, that as the direct course of exchange between London and Paris had ceased, the holder was entitled to recover upon the note, according to the circuitous course of exchange by Hamburgh at the time the note was presented." The effect of payment by a remittance of bills by post, which are lost, has also already been stated. Payment is frequently made by a draft on a banker, in which case, if the person receiving the draft, do not use due diligence to get it paid, the person from whom he received it, and every other party to the bill will be discharged, but not otherwise, unless the holder expressly agreed to run all risks and it has been holden, that the act of writing a receipt in full will not be evidence of such agreement.4(567) When payment is made by the drawee giving a draft on a banker, Marius advises the holder not to give up the bill until the draft be paid. Till lately, the usage in London was otherwise when the drawee was a respectable person in trade; and in one case, it was decided, that a banker having a bill remitted to him to present for payment, is not guilty of negligence in giving it up upon receiving from the acceptor a check upon another banker for the amount payable the same day, although such check be afterwards dishonoured; but in a late case at Nisi Prius, it was considered, that the drawer and indorsers of a bill would be discharged by the holder's taking a check from and delivering up the bill to the acceptor, in case the check be not paid; because the S. C. Vin. Ab. tit. Payment, A. Dent v. Mar. 21. Ward v. Evans, 12 Mod. 521. • Russell v. Hankey, 6 T. R. 12. Paley (367) So it has been held in New York, that a receipt for a note as cash, is not evidence that it is received as an absolute payment. Tobey v. Barber, 5 John Rep. 68. Putnam 3. Lewis, 8 John. Rep. 389. made, and it. a 3dly. Pay- drawer and indorsers have a right to insist on the production of the bill, ment how and to have it delivered up on payment by them. If, however, the what holder of a draft on a banker receive payment thereof in the banker's mounts to notes instead of cash, and the banker fail, the drawer of the check will be discharged." But if a creditor, on any other account than a bill of exchange is offered cash in payment of his debt, or a check upon a [ 288] banker from an agent of his debtor, and prefer the latter, this does not discharge the debtor, if the check is dishonoured, although the agent fails with a balance of his principal in his hands to a much greater amount. When twenty years have elapsed since the date of a note, &c. payment will be presumed unless the contrary appear. And when bills are taken in payment of a debt, and the party sues upon the original consideration, payment of the bills will be presumed till the contrary appear. And it has been holden, that the production of a check drawn by the defendant payable to the plaintiff and indorsed by him, is evidence of the payment, but the mere insertion of the parties name in the draft would not have that effect ; and it should seem that in the first place the indorsement on the check would not be evidence unless stamped as a receipt, such indorsement not being within the exception of the 44 Geo. 3. c. 98. schedule A. or 55 Geo. 3. c, 184, in favour of a receipt, discharge, or acquittance written on the back of a bill or note, draft, or order for payment of money, duly stamped, or on the back of a foreign bill payable in Great Britain. And in a recent case it was held that proof of the delivery and payment of a check to the plaintiff is not sufficient evidence of a debt, in order to support & set-off, unless it be shown upon what consideration and under what circumstances the check was given, and it was even held, that the mere circumstance of a check being made payable to A. and of A's. having recovered payment of it, is not evidence that the maker gave it to him.c As bills of exchange differ from other debts in respect of their as signable quality, it has been decided that a negotiable bill of exchange is not to be considered as paid or satisfied by the drawer's bequeathing a larger legacy to the party in whose. favour it was drawn, although such party continued to be holder at the time of the testator's death. If money be paid into a banking-house to be placed to the credit of another upon a condition, the money in the mean time to stand in the bankers books in the name of the party paying it in; it is at his risk and the loss is his, if the bankers fail before the condition is complied [289] with, though the other party had written to desire it to be paid in generally. Powell v. Roche, Sittings at Guildhall, " Vernon v. Boverie, 2 Show. 296. |