Subject_1 BILL OF EXCHANGE. Subject_2 DIVISION IV.
Possessor's recourse against the Drawer and Indorser.
Subject_3 SECT. II.
Negotiation of Bill.
Sir Alexander Brand of Brandsfield, v. Edward Yorstoun, Tenant in Balbertoun
Date: 10 July 1706 Case No. No 128.
The possessor of a bill, was denied recourse, not having protested for not payment, nor done any diligence against the person drawn upon, until he became insolvent.
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Alexander Brand of Reidhall as principal, and Edward Yorstoun as cautioner, having granted bond to Sir Alexander Brand, for the sum of L. 1944: 18s. Sir Alexander thereafter obtained a precept from Reidhall upon Riccarton, for L. 2536: 6s.; whereby Riccarton was to retire his bonds, tickets, and assignations, by John Brand to his uncle, with all diligences done against him, and to take a general discharge from Sir Alexander, of all he could ask or crave of Reidhall, preceding the date; which should oblige him to allow the same to Riccarton, in part of payment of his bond for the price of the lands of Westerhails. Sir Alexander, in December 1700, about thirteen months after the term of payment of the precept, which Riccarton accepted, received from him 1000 merks in part of payment; and, the first of March 1701, took from him a bond of corroboration for the remaining sum, superceding payment till a certain term after the date of it. Riccarton's affairs falling into disorder, and he thereby failing in payment, Sir Alexander charged Edward Yorstoun upon the bond wherein he was cautioner; who suspended upon these reasons, 1mo, The charger had innovated the debt by not only accepting the precept upon Riccarton, and receiving partial payment thereof; but also by taking his bond of corroboration thereof, more than a year after the term of payment, and by prorogating the term of payment without the drawer's consent, and adjudging Riccarton's estate upon the said bond. 2do, The charger did not duly negotiate the precept, by protesting for not payment against the acceptor debito tempore; but suffered him to break without timeously certiorating the drawer as he ought to have done; since by the act 1696, inland precepts are equivalent to foreign bills, which must be so negotiated, otherwise the possessor can have no recourse against the drawer; and consequently Reidhall and the suspender his cautioner are free.
Answered for the charger: The taking a precept upon Riccarton can never be understood an innovation; because innovation is never presumed, unless exprest. The sum in the bond is less than that in the precept, and the bond was not discharged at the giving of the precept, but was only to have been retired upon payment; and if the accepting Riccarton's precept Be no innovation, it must only be understood a right in further security, which obliges to no diligence. 2do, By the practice of all trading nations, inland precepts, or (as they are termed in England and Holland) assignations, are tied to no such rules of precise negotiation as are required in foreign bills, by reason of the distance of places; in respect all persons concerned in inland bills do ordinarily live not far from one another; and here the drawer, acceptor, and possessor, reside within the compass of a mile: Nor have we any statute that determines a fixed time for negotiating bills; and the act 1696 gives inland bills no other privilege than is allowed to foreign bills by the act 1681, which is only that they should have summary execution and bear annualrent. But suppose inland and foreign bills were equiparate in all things, this precept is not a simple inland bill, but a clogged and qualified note or order; and the charger hath, habili modo, exonered himself of any trust he had thereby, which was principally mandantis gratia; in so far as no ordinary diligence for making the payment effectual was neglected.
Replied for the suspender: There is the same reason for punctually negotiating inland and foreign bills; neither of them being designed for lying securities, but to be presently paid; and the nearer that parties live together, they can be the more easily protested and returned, that the drawer may take course with the person who dishonoured his bill; so that there is a great difference betwixt a precept that is to be negotiated and returned, upon not acceptance or not payment, and an assignation in security, which the assignee may keep by him as long as he thinks fit: Nor hath the charger any ways exonered himself of his trust, which was given both mandatarii et mandantis gratia; in so far as he never protested for not payment, indulged the acceptor of the precept thirteen months delay after it fell due, and prorogated the term of payment several months longer by accepting of a corroborative security, during which time he broke; and any diligence the charger used against him was not upon the precept, or when res was integra, but only upon the corroboration-right after Riccarton's affairs had gone in disorder.
The Lords found, That the bond charged on was not innovated by the taking of a precept upon Riccarton obtaining the same accepted, receiving partial payment, and a bond of corroboration for the remainder, payable at a certain term; but found it relevant to liberate the debtor in the bond charged on, and his cautioner, that the charger did not protest for not payment of the precept, nor did diligence for payment of the same against Riccarton, till his circumstances were altered.
