"Acceptor for honor." which decided, that merely signing one's name across the bill did When acceptance is refused and the bill is protested for non-acceptance, and any person accepts it supra protest for honor of the drawer or of any one of the indorsers, such person is called an ceptor for honor." "" ac Acceptor for Honor.-This party is the person, who after acceptance has been refused by the drawee, or drawee in case of need, accepts the bill, in the form prescribed by the preceding clause, after it has been protested1 according to the form prescribed, 2 but he must have the consent of the holder,3 and unless the acceptance for honor expressly states, for whose honor it is made, it shall be deemed to be made for the honor of the drawer.* It is equivalent to saying to the holder "keep the bill; do not return it, and when the time arrives, at which it ought to be paid, if it be not paid by the party on whom it is drawn, come to me and you shall have the money." The person named in the instrument, to whom or "Payee." to whose order the money is by the instrument directed to be paid, is called the " payee." Payee. The only thing necessary to call attention to, in reference to this definition is, that to constitute a person the payee of an instrument, he must be named and ascertained at the time of making the instrument, but if a person be named in ignorance of his death, his legal representatives may adopt it." The original definition was, the person to whom, or to whose order the money is to be paid, if designated in the instrument otherwise than by the word "bearer" is called the payee. 8. The "holder" of a promissory note, bill of “Holder.” exchange, or cheque, means any person entitled in his own name to the possession thereof and to receive or recover the amount due thereon from the parties thereto. Where the note, bill, or cheque, is lost or destroyed, its holder is the person so entitled at the time of such loss or destruction. Under this section, the 'holder,' like the person defined in Sec. 9, must, in order to entitle him to receive or recover the amount of a negotiable instrument, be entitled in his own name to the possession of it, and this he can only become, by having taken the instrument in accordance with the rules laid down for the negotiation of instruments: that it is to say by delivery from the 1 Sec. 108. • Sec. 109. 3 Sec. 108. 4 Sec. 110, see Brooke on the office of Notary, 4th ed., p. 93. 5 Williams v. Germaine, 7 B. & C. 477; S. C. 1 Moo. & R. 394. 6 Murray v. E. I. Co., 5 B. & A, 204. person making or drawing it, or by indorsement.' Byles thus speaks of a holder, "Holder is a general word applied to the person in actual or constructive possession of the bill, and entitled at law to recover or receive its contents from the parties to it. But if a man find or steal a bill, though his mere possession will give him a title to retain the instrument as against strangers, yet he cannot sue on the bill, for under a traverse of the indorsement or delivery to himself, which he must allege in his statement of claim, the circumstances attending his acquisition of it may be shown."3 To entitle a holder then to recover on the instrument, it would seem from the wording of the section, and from the definition extracted from Byles, that mere possession, though lawful is not sufficient, but the possession must be of right, that is to say must have passed the property in the instrument to the holder. Thus, if a negotiable instrument be delivered to a person to hold in safe custody till the happening of a certain event, the possession passes, but not the property in it; or if a person find such an instrument, he acquires no property in it, for that remains with the loser. While, however, the holder cannot himself obtain a property in the instrument, a person under the next section may obtain such a property in it as will give him the right to recover, for under Sec. 118(g) a holder of a negotiable instrument is presumed to be a holder in due course, unless it has been obtained from its lawful owner by means of an offence or fraud. As pointed out the person in possession is the lawful owner, if it has been delivered to him for a certain purpose, or if he is the finder. In going through the act, we shall have to consider at more length what constitutes a "holder," able to give a good title, in distinction to a holder in due course. The second clause of the section is founded on the before-mentioned principle, that though possession may be with one person, ownership may be in another. 4 A person under the section may, however, become a holder after maturity. While from the definition of a holder in due course, the latter cannot. The following extract from a judg 1 Secs. 14, 15, 51, (expl). 2 Byles on Bills, 13th ed., p. 2. 3 See forms of plaints on Negotiable Instruments, Schedule to Civil Procedure Act XIV of 1882, (App.). Marston v. Allen, 8 M. & W. 494. 4 Collins v. Martin, 3 B. & B. 649; S. C. I B. & P. 648; see Barber v. Richards, 20 L. J. (Ex.) 135; S. C. 6 Exch, 63; Wookey v. Pole, 4 B, & A, 1. ment of Lord Mansfield will illustrate what is meant "when money or notes are paid bona fide and upon a valuable consideration, they shall never be brought back by the true owner; but where they come malá fide into a person's hands, they are in the nature of specific property, and if their identity can be traced and ascertained, the party has a right to recover.”1 A de facto holder is entitled to maintain an action on a bill of exchange, unless it be shown that he holds adversely to the true owner. ? For as long as any party other than the true owner does not complain, and no fraud or offence in obtaining the instrument is shown, the presumption is that the holder is a holder in due course. 3 9. "Holder in due course means any person who for consideration became the possessor of a promissory note, bill of exchange or cheque if payable to bearer, or the payee or indorsee thereof, if payable to, or to the order of, a payee, before the amount mentioned in it became payable, and without having sufficient cause to believe that any defect existed in the title of the person from whom he derived his title. 5 The definition is equivalent to the English expression "boná fide holder for value without notice." The first clause provides, for a person giving consideration for an instrument payable to bearer, which would be transferable by mere delivery1 the second clause, to his being himself the payee, or the indorsee, in both cases however, before the instrument had become payable, or before its maturity,' and without having sufficient cause to believe that the title of the person, from whom he received it was defective. The material points for discussion here, are what will constitute a consideration, and having sufficient cause to believe any defect existed in the title of the person from whom he received his title. "Holder in due course." Consideration.-We have already seen that the Contract Act will, of its own force, extend to all contracts evidenced by negotiable instruments, we shall therefore find its definition in that Act.1 The following are a few cases in which the construction of this definition has been considered.2 A late English case defines consideration very much in the same terms: "Valuable consideration is some right, interest or benefit, accruing to the one party, or some forbearance, detriment, loss, or responsibility suffered or undertaken by the other.3 Following this ruling and taking it, as I think it is, to be very similar to the Indian definition, I will give a few cases showing what has been held to be valuable consideration, in transactions relating to negotiable instruments. A debt due on a decree, was held to be a sufficient consideration for granting a promissory note, though the right to execution was barred by limitation.* A promissory note given in renewal of one barred by limitation. From these it will be seen that the consideration need not necessarily be a money one, so it has been held in England, that a negotiable instrument may be taken for a pre-existing debt, even of a larger amount, the circumstance of negotiability making it in fact a different thing, and possibly more advantageous So also a bona fide, though unfounded claim may form a good consideration." Without having sufficient cause to believe, &c. 6 This is evidently extending the rule of 'without notice,' to constituting the person who is giving value for a negotiable instrument, the judge of whether the information he is in possession of, is good and reliable, and would seem to declare that suspicion would not be sufficient to invalidate his title. There is a marked difference between the expression used here and that in the following section which relates to payment, and the reason probably is, as remarked by Cockburn, C. J., who, admit 1 Contract Act, s. 2 (d), (e), (App). 2 Munni Lal v. Bk. of Bengal, I. L. R., 1 All. 309; Man Kuar v. Jasodha Kuar, Í. L. R., 1 All. 478; Durga Prasad v. Baldeo, I. L. R., 3 All. 221. 3 Currie v. Misa, L. R. 10 Ex. per Lush J. at page 162. 4 Mullens v. Beddy, 6 N. W. P., H. C. R., 150. 5 Chatur Fagsi v. Tulsi, I. L. R., 2 Bom. 230; Raghoji Bhikaji v. Abdul Karim, I. L. R., 1 Bom. 590. 6 Sibree v. Tripp, 15 M. & W. 23; S. C. 25 L. Ĵ. (Ex). 318. Cooke v. Wright, 1 B. & S. 559; S. C. 30 L. J. (Q. B.) 321. |