CHAPTER In trover. After tender. How bankers Court (h), or the plaintiff may proceed in the action for the difference (i). But in trover the rule formerly was that the plaintiff is entitled to damages equal to the value of the article converted at the time of the conversion. And, therefore, in trover for bills or notes, interest was only calculated down to the time of conversion. But by the 3 & 4 Will. 4, c. 42, the jury might give damages over and above the value of the goods at the time of the conversion. 66 Interest ceases to run after a tender. Lord Ellenborough "I think interest ought to stop from the offer to pay "(k). A banker in charging interest to a customer, who has overshould charge drawn his account, should compute it, not from the date, it on cheques. but from the payment of the customer's cheques (4). Recovery of interest after receipt of the principal. When interest not recoverable. When an engagement to give a bill will create a liability to interest. Though the principal have been paid, yet the plaintiff may proceed for interest, unless it have been incurred by the negligence of the plaintiff (m). So where for the amount of the principal on an overdue bill another bill was given, and afterwards paid, it was held that an action lay on the original bill for the interest (n). We have already observed, that where interest is not payable by the terms of the instrument, it is in the nature of damages. Hence it has been held, that the owner of a bill is not necessarily and invariably entitled to interest, but that a jury are justified in reducing or withholding it altogether (o). An engagement to give a bill will create a liability to interest on a contract, which would not otherwise carry it. Thus, where goods are sold to be paid for by a bill which is not given, interest is recoverable as part of the price of (h) Mercer v. Jones, 3 Camp. 477. (i) Kidd v. Walker, 2 B. & Ad. 705. (k) Dent v. Dunn, 3 Camp. 296; 13 R. R. 809. (1) Goodbody v. Foster, Cambridge Summer Assize, 1831, Lyndhurst, C. B. (m) Laing v. Stone, M. & M. 229, n. ; 2 M. & Ry. 561. (n) Lumley v. Musgrave, 4 Bing. N. C. 9; 5 Scott, 230; but see the Chapter on PAYMENT. (0) Cameron v. Smith, 2 B. & Ald. 308; 20 R. R. 444; Du Belloix v. Lord Waterpark, 1 D. & R. 16; 24 R. R. 628; and see Dent v. Dunn, 3 Camp. 296; 13 R. R. 809; Code, s. 57 (3). the goods, and it has been held that this interest may be recovered in an action for goods sold and delivered (p). A party who guarantees the due payment of a bill is liable for interest (g). CHAPTER Liability of a guarantor for interest. Where the action goes on to trial, the jury assess the How interest is recovered. interest; the plaintiff's counsel usually stating the sum which is claimed. Where judgment went by default in debt, the plaintiff indorsed on the writ of execution more than the exact sum due at his peril. In actions of assumpsit the Courts had the power of assessing the damages, but in order to inform the conscience of the Courts they usually issued a writ of inquiry. In actions on bills and notes, however, the amount of damages being mere matter of calculation, the writ of inquiry was formerly supplied by a reference to the master to compute principal and interest, and latterly by the special indorsement, which rendered it unnecessary (r). interest. The rate of interest usually allowed is five per cent., but The rate of we have seen that the jury may reduce the rate, or they may increase it. Thus, where a bill carries ten per cent. interest from its date, a jury may give the same rate of interest from its maturity to judgment (s). The common indebitatus count for interest was good (t). Formerly, to contract for more or to take more than five per cent. interest on any transaction relating to bills or notes was usurious and illegal. Various statutes, however (u), exempted a large proportion of bills and notes from the operation of the usury laws, and at length repealed the usury laws altogether. Indebitatus count. Usury laws. EXCHANGE. Re-exchange is the difference in the value of a bill, REoccasioned by its being dishonoured in a foreign country in which it was payable. The existence and amount of it depend on the rate of exchange between the two countries. (p) Marshall v. Poole, 13 East, 98; 12 R. R. 310; Farr v. Ward, 3 M. & W. 26; 6 Dowl. 163. (4) Ackermanv. Ehrensperger, 16 M. & W. 99. And can prove for it in bankruptcy, Er parte Daris, 66 L. J., Q. B. 499; 76 L. T., N. S. 530. (r) See the Common Law Procedure Act, 1852, s. 94, and 18 & 19 Vict. c. 67, and now Code, s. 57, and Ord. III. r. 6, Ord. XIV. r. 1. (*) Keene v. Keene, 27 L. J., M. & W. 723. (u) 3 & 4 Will. 4, c. 98, s. 7 ; 1 Vict. c. 80; 2 & 3 Vict. c. 37; and 17 & 18 Vict. c. 90. CHAPTER The theory of the transaction is this: A merchant in London indorses a bill for a certain number of Austrian florins, payable at a future date in Vienna. The holder is entitled to receive in Vienna, on the day of the maturity of the bill, a certain number of Austrian florins. Suppose the bill to be dishonoured. The holder is now, by the custom of merchants, entitled to immediate and specific redress, by his own act, in this way. He is entitled, being in Vienna, then and there to raise the exact number of Austrian florins, by drawing and negotiating a cross bill, payable at sight, on his indorser in London, for as much English money as will purchase in Vienna the exact number of Austrian florins, at the rate of exchange on the day of dishonour; and to include in the amount of that bill the interest and necessary expenses of the transaction. This cross bill is called in French the retraite. The amount for which it is drawn is called in low Latin ricambium, in Italian ricambio, and in French and English re-exchange. If the indorser pay the cross or re-exchange bill, he has fulfilled his engagement of indemnity. If not, the holder of the original bill may sue him on it, and will be entitled to recover in that action the amount of the retraite or cross bill, with the interest and expenses thereon. The amount of the verdict will thus be an exact indemnity for the non-payment of the Austrian florins in Vienna on the day of the maturity of the original bill. According to English practice, the retraite or re-exchange bill is now seldom drawn, but the right of the holder to draw it is settled by the law merchant of all nations, and it is only by a reference to this supposed bill that the re-exchange, in other words, the true damages in an action on the original bill, can be scientifically understood and computed. It is plain that whether the indorser gain or lose by the re-exchange depends (except in so far as relates to the expenses) on the rate of exchange between the two countries. If the value of the Austrian florin, measured in pounds sterling, has risen, the holder will be entitled to recover more than the original amount of the bill in English money (r). But if the value of the Austrian florin has declined, then the indorser may not be liable to repay as much English money as the bill was originally drawn for, unless the interest and expenses cover or exceed the difference (y). (x) De Tastet v. Baring, 11 East, 265;2 Camp. 65; 10 R. R.499. (y) Suse v. Pompe, 30 L. J., C. P. 75; 8 C. B., N. S. 538. A custom among London merchants that the holder may at his election sue his indorser, either for the sum which the indorser received of him for the bill, or for the re-exchange, is inconsistent with the obligation appearing on the bill when interpreted by the law merchant, and therefore evidence of such a custom is inadmissible (z). The drawer of a bill is liable to the re-exchange, though the bill be returned through never so many hands (a). But the acceptor has not been held liable to the re-exchange at common law, though it seems to be otherwise in Chancery (b). CHAPTER XXVI. Other damages not necessarily arising from the dishonour, OTHER as noting, postages, telegraphing, &c., were not recoverable DAMAGES. unless specially stated in the declaration (c). But it has Expenses. been held that postage was in some cases recoverable under the count for money paid (d). Though, after the principal sum due on a bill has been once paid, or levied upon the goods of the party ultimately liable, the holder cannot recover it again from any other of the parties, yet if other actions were pending at the time of payment, he may proceed in them for costs, without recovering any part of the principal sum (e). (z) Suse v. Pompe, supra; Willans v. Ayers, L. R., 3 App. Ca. 133. (a) Mellish v. Simeon, 2 H. Bl. 378; 3 R. R. 418. (b) Napier v. Schneider, 12 East, 420; Woolsey v. Crawford, 2 Camp. 445. See now, however, Code, s. 57; Walker v. Hamilton, 1 D. F. & J. 602; In re General South American Co., 7 Ch. D. 637; Ex parte Robarts, 18 Q. B. D. 286; 56 L. J., Q. B. 74. The case of In re The Commercial Bank of Australia, 36 Ch. D. 522, shows that the first two subsections of Code, s. 57, are not in the alternative; but that in the case of a bill dishonoured in a foreign country, re-exchange with interest by sub-section (2) is to be recovered, but not interest under sub-section (1). In Ex parte Robarts, supra, when a bill drawn in Tobago was dishonoured here, a drawer who was liable to the holder for the re-exchange was held entitled to recover it from the acceptor. (c) Kendrick v. Lomar, 2 C. & J. 405; 2 Tyr. 438. In which case it was held, that the bill having been renewed, the plaintiff could not recover the charges on the first bill while the second bill suspended the remedy on it. It seems doubtful whether the expense of noting an inland bill, not protested, can at common law in any case be recovered. Ibid. But see the Bills of Exchange Act, 18 & 19 Vict. c. 67, s. 5. See also Rogers v. Hunt, 10 Exch. 474; Prehn v. Liverpool Bank, L. R., 5 Ex. 92; 39 L. J. 41. Quære, if other charges are liquidated damages within s. 57. (d) Dickinson v. Hatfield, 1 M. & Rob. 141; 5 Car. & P. 46. The defendant in this case directed the plaintiff to charge him with it. See the Chapter on PROTEST. As to nominal damages, see Beaumont v. Greathead, 2 C. B. 495. See now Code, 57, 1 (c). (e) Toms v. Powell, 7 East, Costs as damages; Incurred by plaintiff. CHAPTER Recovered by COSTS. Indorsers, who have to pay costs of actions against them, cannot sustain an action for those costs against the acceptor (ƒ), nor, it is conceived, against any other party. In common language, a bill accepted or indorsed without any consideration moving to the party making himself liable on the bill, is called an accommodation bill; but, in strictness (g), an accommodation bill is not merely a bill accepted or indorsed without value received by the acceptor or indorser, but a bill accepted or indorsed without value by the acceptor or indorser, to accommodate the drawer, or some other party; i.e., that the party accommodated may raise money upon it, or otherwise make use of it. This distinction is of importance; for a party accepting a bill merely without consideration (as if, for example, he does not know the state of accounts between himself and the drawer), and afterwards sued on that bill, cannot charge the drawer with the costs of defending the action (h); whereas, the acceptor of an accommodation bill, properly so called, who is compelled by an action to pay it, may have a claim upon the drawer for all the expenses of the action (i). But an accommodation acceptor has no right to charge the party accommodated with the costs of an action, to which the accommodation acceptor had evidently no defence (k). If the case is tried before a judge without a jury the Before judge. costs are in the discretion of the judge (1). With jury. But if the action is tried with a jury, the costs will follow the event, unless the judge or the Court for good cause otherwise order (m). 536; 3 Smith, 554; 6 Esp. 40; (f) Dawson v. Morgan, 9 B. & C. (g) See ante, pp. 143, 155. (h) Bagnall v. Andrews, 7 Bing. 217; 4 Moo. & P. 839. Compare Tindal v. Bell, 11 M. & W. 228; Ronneberg v. Falkland Islands Company, 17 C. B., N. S. 1. (i) Ex parte Marshall, 1 Atk. 262; Jones v. Brooke, 4 Taunt. 464; Stratton v. Matthews, 18 L. J., Exch. 5; 3 Exch. 48; Garrard v. Cottrell, 10 Q. B. 679. (k) Roach v. Thompson, M. & M. 487; Beech v. Jones, 5 C. B. 696. (1) Ord. LXV. r. 1; Jud. Act, 1890, s. 5. But this discretion is judicial. Cooper v. Whittingham, 15 Ch. D. 501. Though for sufficient reason the party who succeeds may be ordered to pay the costs of his opponent. Harris v. Petherick, 48 L. J., Q. B. 521 ; 4 Q. B. D. 611. (m) Ord. LXV. r. 1. The application to the judge who tries the action to "otherwise order need no longer be made "at the trial." |