If A lives in Jamaica, and owes B who lives in England 1000l. now if C be going from England to Jamaica, he may pay B this 1000l. and take a bill of exchange drawn by B in England upon A in Jamaica, and receive it when he comes thither. Thus does B receive his debt, at any distance

of place, by transferring it to C; who carries over his [467] money in paper credit, without danger of robbery or

loss. This method is said to have been brought into general use by the Jews and Lombards, when banished for their usury and other vices; in order the more easily to draw their effects out of France and England, into those countries in which they had chosen to reside. But the invention of it was a little carlier: for the Jews were banished out of Guienne in 1287, and out of England in 1290; and in 1236 the use of paper credit was introduced into the Mogul empire in China. In common speech such a bill is frequently called a draft, but a bill of exchange is the more legal as well as mercantile expression. The person, however, who writes this letter, is called in law the drawer, and he to whom it is written the drawee; and the third person, or negociator, to whom it is payable (whether specially named, or the bearer generally) is called the payee.

THESE bills are either foreign, or inland; foreign, when drawn by a merchant residing abroad upon his correspondent in England, or vice versa; and inland, when both the drawer and the drawee reside within the kingdom. Formerly foreign bills of exchange were much more regarded in the eye of the law than inland ones, as being thought of more public concern in the advancement of trade and commerce. But now by two statutes, the one 9 & 10 W. III. c. 17. the other 3 & 4 Ann. c. 9. inland bills of exchange are put upon the same footing as foreign ones; what was the law and custom of merchants with regard to the one, and taken notice of merely as such', being by those statutes expressly enacted

ir 2 Carte. Hist. Eng. 203. 206.

s Mod. Un. Hist. iv. 499.

t 1 Rol. Abr. 6.

with regard to the other. So that now there is not in law any manner of difference between them (21).

PROMISSORY Notes, or notes of hand, are a plain and direct engagement in writing, to pay a sum specified at the time therein limited to a person therein named, or sometimes to his order, or often to the bearer at large. These also, by the same statute 3 & 4 Ann. c. 9. are made assignable and indorsable in like manner as bills of exchange. But, by statute 15 Geo. III. c. 51. all promissory or other notes, bills of exchange, drafts, and undertakings in writing, [468] being negociable or transferable, for the payment of less than twenty shillings, are declared to be null and void; and it is made penal to utter or publish any such; they being deemed prejudicial to trade and public credit. And, by 17 Geo. III. c. 30. all such notes, bills, drafts, and undertakings, to the amount of twenty shillings, and less than five pounds, are subjected to many other regulations and formalities; the omission of any one of which vacates the security, and is penal to him that utters it (22).

(21) One very important distinction between foreign and inland bills of exchange still remains unaltered by the statutes; viz. in a foreign bill, in order to recover against the drawer or indorsers, it is necessary that the bill should be protested for non-acceptance or non-payment, T. R. 239; but a protest is not necessary upon an inland bill, to enable the holder to recover the amount of it against the drawer or indorsers; and the only advantage of a protest upon an inland bill is to give the holder a right to recover interest and expenses incurred by the non-acceptance or non-payment. Ld. Raym. 993. No inland bill, payable at or after sight, can be protested; or which is not drawn payable at some time after date. 4 T. R. 170.

(22) Every note or bill of that value shall specify the name and place of abode of the payee; it shall not be antedated, and shall be made payable within twenty-one days after date; and every indorsement shall be made within that time, and shall be dated when and where made, and shall contain the name and place of abode of the indorsee.

THE payee, we may observe, either of a bill of exchange or promissory note, has clearly a property vested in him (not indeed in possession but in action) by the express contract of the drawer in the case of a promissory note, and, in the case of a bill of exchange, by his implied contract, viz. that, provided the drawce does not pay the bill, the drawer will: for which reason it is usual, in bills of exchange, to express that the value thereof hath been received by the drawer"; in order to shew the consideration, upon which the implied contract of repayment arises. And this property, so vested, may be transferred and assigned from the payee to any other man; contrary to the general rule of the common law, that no chose in action is assignable: which assignment is the life of paper credit. It may therefore be of some use, to mention a few of the principal incidents attending this transfer or assignment, in order to make it regular, and thereby to charge the drawer with the payment of the debt to other persons than those with whom he originally contracted.

In the first place then, the payee, or person to whom or whose order such bill of exchange or promissory note is payable, may by indorsement, or writing his name in dorso or on the back of it, assign over his whole property to the

u Stra. 1212.

The penalty for not complying with the statute is from 5 to 207. at the discretion of a magistrate.

But by the 37 Geo. III. c. 32. these two statutes, with respect to promissory notes and drafts, payable on demand to bearer are suspended. And by 37 Geo. III. c. 61. if any person shall issue such notes or drafts for less than five pounds, and shall fail to discharge them within seven days after payment is demanded by the holder, then a complaint may be made to a justice of peace, who may order what is due to be paid with costs, and upon failure of compliance with his order, he may by his warrant cause the same to be levied by distress of the parties goods.

The Bank of England was enabled to issue small notes by the 37 Geo. III. c. 28.

bearer, or else to another person by name, either of whom is then called the indorsee; and he may assign the same to another, and so on in infinitum. And a promissory [469] note, payable to A or bearer, is negociable without any indorsement, and payment thereof may be demanded by any bearer of it v. But, in case of a bill of exchange, the payee, or the indorsee, (whether it be a general or particular indorsement,) is to go to the drawee, and offer his bill for acceptance; which acceptance (so as to charge the drawer with costs) must be in writing, under or on the back of the bill (23). If the drawee accepts the bill, either verbally or in writing w, he then makes himself liable to pay it; this being now a contract on his side, grounded on an acknowledgment that the drawer has effects in his hands, or at least credit sufficient to warrant the payment. If the drawee refuses to accept the bill, and it be of the value of 201. or upwards, and expressed to be for value received, the payee or indorsee may protest it for non-acceptance; which protest must be made in writing, under a copy of such bill of exchange, by some notary public; or, if no such notary be resident in the place, then by any other substantial inhabitant in the presence of two credible witnesses; and notice of such

v 2 Show. 235. Grant v. Vaughan. T. 4 Geo. III. B. R.

w Stra, 1000.

(23) It is fully settled, that a verbal acceptance will bind the drawee. Str. 1000. Yet it appears from the statutes, which are very far from being so intelligible as the importance of the subject demanded, that if the drawee refuses to accept in writing, the bill may be protested for non-acceptance. 3 & 4 Ann. c. 9. s. 4. But if a verbal acceptance is received by the holder, the bill cannot afterwards be protested for nonpayment, so as to charge the drawer with costs, damages, and interest, in consequence of the protest. s. 5.

. But a promise to accept a bill before it is drawn, does not amount to an acceptance of it when it is drawn. 1 East, 98.

protest must, within fourteen days after (24), be given to the drawer.

BUT, in case such bill be accepted by the drawee, and after acceptance he fails or refuses to pay it within three days after it becomes due (25), (which three days are called days of grace,) the payee or indorsee is then to get it protested for non-payment, in the same manner, and by the same persons who are to protest it in case of non-acceptance, and such protest must also be notified, within fourteen days after, to the drawer. And he, on producing such protest, either of non-acceptance, or non-payment, is bound to make good to the payee, or indorsee, not only the amount of the said bills, (which he is bound to do within a reasonable time after non-payment, without any protest,

(24) See note 26.

(25) A bill or note is not now considered due or demandable till the last day of the three days' grace; as if a bill or note is dated on the 12th of any month, and made payable ten days, one week, or one month after date, payment must be aemanded on the 25th, the 22d of the same, and on the 15th of the next month respectively. But if the third day of grace falls on a Sunday the bill or note is payable and due on the Saturday preceding; and by 39 & 40 Geo. III. c. 42. if payable on Good Friday, they are due the day before. Days of grace are allowed upon promissory notes, in like manner as upon bills of exchange.

4 T. R. 148.

A promissory note made payable to A, without adding or to his order, or to bearer, though not negociable, is a note within the statute, and the three days of grace must be allowed upon it. 6 T. R. 123.

A bill or note must be drawn upon a proper stamp, and if it be drawn upon a greater stamp than the statutes require, it cannot be received in evidence; but the plaintiff may recover as for so much money lent or advanced, if he can prove the defendant's promise to pay, or the consideration received by him from the plaintiff, independently of the imperfect note. 1 East, 55.