Subject_1 BILL OF EXCHANGE. Subject_2 DIVISION II.
The Porteur's Action against the Person upon whom the Bill is Drawn.
Subject_3 SECT. II.
Extraordinary Privileges of Bills.
James Fairholm Merchant, v. William Cockburn
Date: 24 June 1714 Case No. No 94a.
Separate receipts, of partial payments of bills of exchange, do not militate against possessors, to whom the bills are afterwards indorsed.
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Messrs Hunter and Crawford having drawn a bill of L. 400 Sterling, on William Cockburn, payable to Alexander Campbell; the bill being accepted and part paid, Mr Campbell indorses the bill in these terms:
“Pay L. 118 of the principal within mentioned, with the exchange current of the whole, to James Fairholm, or order; but this my indorsation is noways to militate against me.”
Cockburn the acceptor of the bill suspends, and alleges payment to Hunter and Crawford the drawers of the bill, conform to two receipts extending to L. 168, which ought to be allowed; because Campbell was but a name and trustee for the behoof of the drawers.
It was answered, Supposing Campbell a trustee, yet no respect to these receipts, because not written upon the accepted bill; for such is the favour of bills of exchange, that they are to pass current de manu in manum, as bags of money, and are affected with nothing but what appears upon the bill itself; otherwise merchants would be at great uncertainty in the course of trade, and would not know what bills could be safely relied upon; and it is for the same reason, that compensation, which takes place against all other debts, is not regarded to stop the currency of bills of exchange; and this is the opinion of Mr Forbes, who has written on that subject, p. 161. § 2. par. 4. in fine. (Edition 1703.)
It was replied, There is no law nor settled custom for rejecting payments upon receipts a-part; and there is here also a speciality, that the bill is indorsed no ways to militate against the indorser; and the indorser being but a trustee, the suspender was in optima fide to make payment to the true creditor in the bill.
It was duplied, The Lords have, of late, had respect to no exception that might diminish the credit or currency of bills of exchange; and there is in this case not only the opinion of Mr Forbes, but the practice of trading nations, and especially the merchants of this country; and the Ordinary, for his fuller satisfaction in this matter, having desired the opinion of merchants of the first credit, their is a report of two merchants, one named by either party, declaring the constant practice of merchants to be for the charger; and that the speciality of providing that there shall be no recourse against the indorser, makes no alteration. It is not, nor can be pretended, but that the charger obtained the indorsation for a just and onerous cause, and therefore ought not to be disappointed of the security that all merchants do rely upon.
‘The Lords repelled the reason of suspension.’ See No 91. p. 1501.
