neral. CHAPTER III. OF THE FORM AND REQUISITES OF BILLS, &c.-THE The form THOUGH a bill of exchange, check, promissory note, &c, must be of bills of in writing, there is in general no particular form, or set of words, exchange, &c. in ge-necessary to be adopted, any more than in the case of a bond or other deed. And indeed our courts considering the general utility of these instruments, and how much they tend to the extension of credit, and consequent advancement of trade and commerce, have uniformly gone further in giving effect to them as instruments, than they have where a question has arisen on the formation of a deed. Thus an order or promise to deliver money, or a promise that I. S. shall receive money, or a promise to be accountable or responsible for [ 42 ]it, will be a sufficient bill or note ; and where a note was in these words, "borrowed of I. S. £50, which I promise never to pay," the word "never" was rejected, and the holder recovered ; and in a late case it was decided, that an instrument in the cominon form of a bill of exchange, except that the word "at" was substituted for "to," before 2. Thomas v. Bishop, Rep. Temp. Hardw. v. b Com. Dig. tit. Obligation, B. 1, 2. Morris v. Lee, Ld. Raym. 1396. 1 Stra. Chadwick v. Allen, 2 Stra. 706. A note was in these words: "I do acknowledge that Sir Andrew Chadwick has delivered me all the bonds and notes, for which 4001. were paid him on account of Colonel Synge, and that Sir Andrew delivered me Major Graham's receipt and bill on me for 10., which 107. and 157. 5s. balance, due to Sir Andrew, I am still indebted and do promise to pay," and upon demurrer to the declaration, the court held it a note within the statute. Cashborne v. Dutton, Scacc. M. 1 Geo. 2. MS. Sel. Ni. Pri. 363. Where the note set forth in the declaration was, "I do acknowledge myself to be indebted to A. in L, to be paid on demand, for value received." On demurrer to the declaration, the court, after solemn argument, held, that this was a good note within the statute, the words "to be paid," amounting to a promise to pay, observing that the same words in a lease would amount to a covenant to pay rent. See cases in last note. d Cited by Lord Mansfield in Russell v. Langstaff, B. R., M. 21 Geo. 3. and in Peach v. Kay, Sittings after Trin. Term, 1781. and per Lord Hardw. 2 Atk. 32. Bayl. 5. of bills of the name of the drawee, may be declared on as a bill of exchange, or The form as a promissory note at the option of the holders ; and we have seen, exchange, that an instrument that appears, on common observation, to be a bill of &c. exchange, may be treated as such, although words be introduced into it for the purpose of deception, which might make it a promissory note.'(55) It is however advisable to draw bills, &c. according to the forms hereafter given. And in the case of bills and notes, for the payment of less than £5, certain forms must be observed, for it is provided that all negotiable bills or notes made in England for less than twenty shillings, shall be void, and all negotiable bills or notes made in England (excepting Bank of England notes and notes payable to the. bearer on demand) for the payment of twenty shillings and less than £5, should be void, unless they specify the name and place of abode of the person to whom or to whose order they are made payable, and be attested by one subscribing witnesss, and bear date at or before the time when they are issued, and be made payable within twenty-one days after the date, and be in the form prescribed by the act. neral quisites. There are two principal qualities essential to the validity of a bill or Their note, first, that it be payable at all events, not dependent on any con tingency, nor payable out of a particular fund; and secondly, that it be for the payment of money only, and not for the payment of money, and performance of some other act, or in the alternative; for it would perplex commercial transactions, if paper securities of this nature, encumbered with conditions and contingencies were circulated, and if the persons to whom they were offered in negotiation, were obliged to inquire when these uncertain events would probably be reduced to a certainty.* First. An order or promise to pay money, provided the terms mentioned in certain letters, shall be complied with,' or provided that I. S. • Shuttleworth v. Stephen, 1 Campb. 407. Ante, 21. Allen v. Mawson, 4 Campb. 115. Ante, 21. 8 17 Geo. 3. c. 30. s. 1. See the statute in the Appendix. b 48 Geo. 3. c. 88. i 17 Geo. 3. c. 30. s. 1. made perpetual by 27 Geo. 3. c. 16. See post, Appendix. Per Kenyon, C. J. in Carlos v. Fancourt, 5 T. R. 485. Dawkes v. Lord de Loraine, 3 Wils. 213. 2 Bla. Rep. 782. S. C. Roberts v. Peake, 1 Burr. 325. I Kingston v. Long, B. R., M. 25 Geo. 3. The plaintiff brought an action as indorsee against the defendant as acceptor, upon an order importing to be payable, "provided the terms mentioned in certain letters written by the drawer were complied with," and the court held clearly, that the plaintiff could not recover, though the acceptance admitted a compliance with the terms, for the order was no bill until after such compliance, and if it were not a bill when drawn, it could not afterwards become one. Bayl. 9. re (55) These requisites apply only to a bill or note in its original formation, for it seems that an acceptance may be to pay upon a contingency, or in bills, &c. and not in money. See post. The doctrine that a bill payable out of a particular fund, is not negotiable according to the custom of merchants, has been recognised in Kentucky. Mershon v. Withers, 1 Bibb's R. 502. A bill of exchange must not be made payable out of a particular fund, but if the fund is certain and is described only as a mean by which the drawee is to be indemnified, the bill is good. Bank of Kentucky v. Sanders, 3 Marsh. 184. The word "note" is sometimes considered as a general term, comprehending both bills of exchange and promissory notes, and was held to embrace the former, when used in an assignment for the benefit of creditors. Da Costa v. Guieu, 7 Serg. & Rawle, 402. sites. Their gen- shall not be surrendered to prison within the limited time," or provided eral requii. S. shall not pay the money by a particular day," or provided I. S. shall leave me sufficient, or I shall otherwise be able to pay it," or when I. S. shall marry, or if the maker should be married within two months, or to pay a sailor wages if he do his duty as an able seaman,a is no bill or note on account of the contingency upon which the payment depends. г So, if by the terms of the instrument, the payment is to depend upon the sufficiency of a particular fund, the bill or note will be invalid; thus an order to pay money out of the drawer's growing subsistence, or out of the fifth payment when it should become due, and it should be allowed by the drawer, or out of money when received, [44] or an order to pay the amount of a note and interest out of the purchasemoney of the drawer's house," or an order or promise to pay out of the drawer's money that should arise from his reversion, when sold, is no Smith v. Boehm, 3 Lord Raym. 67. cited Lord Raym. 1362. 1396: Action by the plaintiff as payee of the note, against the makers, upon a promise to pay the plaintiff, or order, on demand, the sum of 711. 12s. 10d. or surrender the body of Samuel Boehm in an action brought against him by Smith. Verdict for the plaintiff, and judgment; and on error brought in the King's Bench, the court held that this was not a note within the statute, because the money was not absolutely payable, but depended upon the contingency whether the defendants should surrender Samuel Boehm to prison, and the judgment was reversed. "Appleby v. Biddulph, cited 8 Mod, 363. 4 Vin. Abr. 240, pl. 16. An action was brought on this note, "I promise to pay T. M. 50%. if my brother doth not pay it within six weeks," and after verdict for the plaintiff, the court arrested judgment, because the maker was only to pay it upon a contingency. Roberts v. Peake, Burr. 323. The plaintiff, as indorsee of a note, sued one of the makers; the instrument was in these words; "we promise to pay A. B. 1167. 118. value received, on the death of George Henshaw, provided he leaves either of us sufficient to pay that said sum, or if we otherwise shall be able to pay it;" and upon a case reserved, the court held it was not a negotiable note, because it was payable eventually and conditionally only, and not absolutely and at all events, and a nonsuit was entered; and see Ex parte Tootell, 4 Ves. 372. P Beardsley v. Baldwin, Stra. 1151. A note to pay money within so many days after the defendant should marry, was held not to be a negotiable note; and in Pearson v. Garrett, Comb. 277, and 4 Mod. 242; an action having been brought upon a note, by which the defendant promised to pay the plaintiff sixty guineas, if he (the plaintiff) should be married within two months, the court inclined against the note, because it was to pay money on a mere contingency. 10 9 Alves v. Hodgson, 7 T. R. 242. Jocelyn v. Laserre, Fort. 281. Mod. 294. 316. Evans drew upon Jocelyn, and required him to pay Laserre 71. per month out of Evans's growing subsistence. Laserre sued Jocelyn, and had judgment, but upon a writ of error, that judgment was reversed, because this draft was not a good bill of exchange, inasmuch as it would not have been payable had Evans died, or had his subsistence been taken away. Haydock v. Linch, Lord Raym. 1569. Rogers drew upon Linch, and requested him to pay Haydock 141. 3s. out of the fifth payment when it should become due, and it should be allowed by Rogers. Linch accepted the draft, and Haydock sued him, but the court, upon demurrer to the declaration, held this was no bill of exchange, and gave judgment for the defendant. Dawkes v. Lord de Loraine, 2 Bla. Rep. 782. 3 Wils. 207. A draft was in these words, " 8 Jan. 1768. Seven weeks after date, pay to Mrs. Dawkes 321. 178. out of W. Steward's money, as soon as you shall have received it, for your humble servant, De Loraine. To Timothy Brecknock, Esq." Brecknock accepted the bill, but it not being paid, Mrs. D. brought an action against Lord de Loraine, who pleaded that Brecknock had not received W. Steward's money; and upon demurrer to his plea, insisted that this was not a bill of exchange. The court, after argument, held the objection good, because it was payable out of a particular fund, and on an event which was future and contingent, viz. the receipt of W. Steward's money, whereas a bill ought to be subject to no event or contingency, except the failure of the general personal credit of the persons drawing or negotiating it. "Yates v. Grove, I Ves. jun. 280. 1. eral requi bill or note. So an order to pay a sum of money out of the rents or Their gen other money in the hands of the person to whom it is addressed, is no sites. bill, because he may not have rent or other money in his hands sufficient to discharge it. So a promise to pay on the sale or produce, immediately when sold, of the White Hart Inn, St. Albans, and the goods, &c. is no note, although it be averred in the declaration upon such promise, that the White Hart Inn, goods, &c. were sold before the action was commenced. So an order from the owner of a ship to the freighter, to pay money on account of freight, is no bill, because the quantum due [ 45 ] on the freight may be open to litigation," but such an order from the freighter is, because it is an admission that so much at least is due." So an instrument by which the party promises to pay the sum of £65, and also such other sum as, by reference to his books, he owed to another with interest, cannot be considered as a promissory note even as to the £65, and cannot be given in evidence under the count upon an account stated, without an agreement stamp; however, a verbal agreement, qualifying the liability to pay the bill, will not vitiate.a Secondly, the bill or note must be for the payment of money only, and not for the payment of money and performance of some other act, * Carlos v. Fancourt, in error from the C. P. 5 T. R. 432. Assumpsit upon a promissory note, whereby Carlos, in the life-time of defendant's wife, promised to pay Fancourt's wife the sum of 101. "out of his money that should arise from his reversion of 431. when sold." The defendant suffered judgment by default, and brought a writ of error, and the court held that this note could not be declared upon as a negotiable security under the stat. 3 & 4 Ann. c. 9. the ob ject of which statute was to put promissory notes on the same footing with bills of exchange in every respect, and they must stand or fall by the same rules by which bills of exchange were governed; and unless they carried their own validity on the face of them, they were not negotiable, and on that ground bills of exchange which were only payable on a contingency, were not negotiable, because it did not appear on the face of them whether or not they would ever be paid. The same rule that governed bills of exchange in this respect must govern promissory notes, and therefore reversed the judgment. Hill v. Halford, infra, note, and post, p. 45, note. * Jenney ». Herle, Lord Raym. 1861. 8 Mod. 265. Stra. 591. Herle sued Jenney upon a bill drawn by him upon Pratt: and payable to Herle as follows: "Sir you are to pay Mr. Herle 19457. out of the money in your hands, belong ing to the proprietors of the Devonshire Mines, being part of the consideration money for the purchase of the manor of West Buckland." Herle had judgment in the Common Pleas: but upon a writ of error, the court of King's Bench held, that this was no bill of exchange, because it was only payable out of a particular fund, supposed to be in Pratt's CHITTY ON BILLS. hands, and the judgment was accordingly Hill v. Halford and another, in error, goods before the commencement of the a Banbury v. Lissett, Stra. 1211. Gib- b Pierson v. Dunlop, Cowp. 571. M'Lin- freight. Pierson afterwards sued Dunlop and Smith v. Nightingale, 2 Stark. 375. • Campbell v. Hodgson, I Gow, 74. G sites. Their gen- or in the alternative. Thus, if an instrument be to deliver up horses eral requi- and a wharf, and pay money on a particular day, or to pay a sum of money, or surrender to I. S to prison, or to pay money in good East India Bonds, it is not a bill or note. If the bill, note, &c. be insufficient in its formation in either of these respects, it will not become valid by any subsequent occurrence rendering the payment no longer contingent; and the instrument will not be negotiable, not can it be declared upon as a bill, even between the original parties; (1) and though it may in some cases be declared upon as [46] an agreement, yet it cannot be produced in evidence, unless stamped as such; and even if it be stamped, the consideration on which it was founded must be proved. So, though the instrument may, on the face of it, be absolute, yet if by a memorandum on the back of it, the payment is rendered conditional, it cannot be declared upon as a bill or note between the same parties. And therefore, where upon an instrument in the common form of a joint and several promissory note, signed by three persons, there was an indorsement written at the time of signing it, stating that the note was taken as a security for all balances to the amount of the sum within specified, which one of the three might happen to owe to the payee, and that the note should be in force for six months, and that no money should be liable to be called for sooner in any case; it was decided, in an action against one of the sureties, that the payee could not declare upon this instrument as a promissory note, payable either on demand, or at six months after date. • Martin v. Chauntry, Stra. 1271. On error from the court of Common Pleas, the court of King's Bench held, that a note to deliver up horses and a wharf, and pay money at a particular day, was not a note within the statute, and reversed the judgment in favour of the original plaintiff. Smith v. Boehm, Gilb. Cases L. & E. 93. cited also in Lord Raym. 1362. 1396. and see 3 Lord Raym. 67. Error on judgment in C. P. upon a note to pay 721. upon demand for value received, or render the body of A. B. &c. to the Fleet, before such a day. The court held such note to be contingent and invalid. Anon. Bull. Ni. Pri. 272. a written promise to pay 3007. to B. or order, in three good East India Bonds, was held not to be a note within the statute. Hill v. Halford, 2 Bos. & Pul. 413. Ante, p. 44. Colehan v. Cooke, Willes, 399. post. p. 48. Kingston v. Long, ante, 42. Selw. N. P. 367, n. 71. acc. Lewis v. Orde, 1 Gilb. Ev. by Loft, 179. semb. Leeds v. Lancashire, 2 Campb. 205. The defendant, Marriott and Ball, gave a joint and several promissory note to the plaintiffs for 2001. No time for payment was mentioned in the note. On the back was written, "The within note is taken for security of all such balances as James Marriott may happen to owe to Thomas Leeds and Co. not extending farther than the within sum of 2007., but this note to be in force for six months, and no money liaable to be called for sooner in any case." This memorandum was written before the note was signed by the defendant or Ball It appeared in an action upon this note, that, in the course of mercantile dealings, Marriott had become indebted to the plaintiffs, and that on their refusing to deal with him any longer without some guarantee, the above instrument, which the makers represented to be a note, was given. It was impressed with a promissory note stamp. Lord Ellenborough. As between the original parties this instrument is only an agreement, and not a note; in the hands of a bona fide holder, who received it as a promissory note, it might possibly be considered as such. The plaintiffs were nonsuited. (1) On a draught payable out of a particular fund of money in the drawer's hands belonging to the payee, the payee may maintain an action against the drawer in case of the drawee refusing acceptance Joliffe v. Higgins, 6 Mumf. 3. |