Subject_1 BILL OF EXCHANGE. Subject_2 DIVISION IV.
Possessor's recourse against the Drawer and Indorser.
Subject_3 SECT. II.
Negotiation of Bill.
Smith and Payne v. Laing, Arthur, and Company
Date: 29 June 1786 Case No. No 170.
When the last day of grace happens to be Sunday, the bill must be protested on the day preceding. A bill protested on the day following, was found not duly negotiated.
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A bill drawn and accepted in London, was indorsed to Laing, Arthur, and Company, in Scotland. It was afterwards indorsed to smith and Payne of London. The last of the days of grace happened to fall on a Sunday, and the bill was not protested till the day following.
Smith and Payne, the last indorsees, having for their recourse used diligence against Laing and Company, prior ones, the latter brought a process of suspension, on this ground, That recourse was barred by undue negotiation, as the protest ought to have been taken on the second, and not delayed till after the last day of grace was expired. And, in support of this objection, they
Pleaded, When the third of the days of grace falls on a Sunday, the rule is, That the bill should be protested on the preceding day; Ramsay contra Hogg, No 140. p. 1564.; Cruickshanks contra Mitchell, No 145. p. 1576. This rule is general with regard to all bills, whether inland or foreign; 9th January 1731, M'Kenzie contra Urquhart, No 137. p. 1561.; Bankton, vol. 1. p. 364. § 23.
If the law of England, as that of the locus contractus, were to govern this question, the same rule would still be admitted; this bill, in the construction of that law, being, with respect to the present parties, a foreign one. For the indorsation to persons in this country would be deemed equivalent to a new, and consequently a foreign bill. “When a bill of Exchange, (to use the words of the Earl of Mansfield) is indorsed by the person to whom it was made payable, as between the indorser and indorsee, it is a new bill of exchange, and the indorser stands in the place of the drawer.” Burrow's Reports, vol. 2. p. 674.
Answered, Both the drawer and the drawee having been resident in England, the bill in question is inland, and not foreign. Erskine, b. 2. tit. § 25.; Blackstone's Commentaries, vol. 2. p. 467.
By the law of England, the lex loci contractus, the protesting of inland bills at all is not necessary for recourse, except as to interest and charges; and even then it is only required after the expiration of the three days of grace; statute 9th and 10th William III. cap. 17.; Bankton, vol. 1. p. 369. § 2.; Raymond Rep. p. 993. Brough versus Parkins; Blackstone, vol. 2. p. 469. And a similar decision was pronounced by this Court, with respect to a bill payable in London, which had not been protested till the fourth day after it became due. Bruce, 1st February 1715, Johnston contra Murray, No 132. p. 1556.
The Lord Ordinary sustained the plea of undue negotiation as a ground of suspension; and
The Court adhered to the interlocutor of the Lord Ordinary.
Lord Ordinary, Stonefield.For Suspenders, Neil Fergusson.Alt. A. Campbell.Clerk, Robertson.
Fol. Dic. v. 3. p. 83. Fac. Col. No 282. p. 434.
