Scottish Court of Session Decisions

Page: 387↓

Alexander Edward Broddelius of Gothenburg, and M'Grigor, Donald, & Company, his mandatories, raised this action against Rudolph Grischotti, Glasgow, for the sum of £460, 7s. 8d., as the amount, with interest, contained in a promissory-note payable three months after notice for 6000 kroner (at the current exchange of the day, £330, 15s. 2d), granted by the defender in favour of Christian Marchion Grischotti, Gothenburg, and endorsed and delivered by him to the pursuer. The £460, 7s. 8d. was made up of that sum of £330, 15s. 2d., and interest said to have been unpaid since 1st May 1878. The promissory-note was in the following terms—“Three months after notice I promise to pay Mr C. M. Grischotti or order the sum of six thousand kroner (6000 kroner) with interest of five per cent. per annum until payment is made. Value received.—Gothenburg, the 1st May 1876. (Signed) Rudolph O. Grischotti.” Formal notice requiring payment was given, it was alleged, on 8th June 1880. The action was raised on 3d March 1886.

The defender stated in defence that the document founded on, if a promissory note, was prescribed; that it was not a good note, because the term of payment was conditional on an event which need not happen; that, if a note, it was null, not having been duly stamped before it was presented for payment, or indorsed, transferred, or negotiated in the United Kingdom. In particular, it was not duly stamped when presented by the Bank of Scotland for and on behalf of the pursuer to defender for payment on or about 9th March 1881, nor when it was negotiated and payment demanded by Huth & Co, London, Mr Gray of J. Findlay & Co., Glasgow, both for and on behalf of the pursuer, and by the present agents of the pursuer. He further stated that a litigation was going on in Sweden between the pursuer and persons claiming right to the document, and that be had been interpelled from paying to the pursuer.

The pursuer denied this averment, or that the note had been negotiated before it was presented by his agents in 1886, when it was duly stamped.

The Sheriff-Substitute ( Guthrie) repelled the defences.

On appeal the Sheriff ( Berry) adhered.

“ Note.—The only questions raised before me related to the defences that the note is prescribed and that the note not being duly stamped is null. The question under the former of these pleas depends on whether the sexennial limitation of bills and notes, in the case of a note made payable a certain time after notice (which may be taken as equivalent to ‘after demand’), runs from the expiration of the stipulated period after the date of the bill, or from that period after the date of demand. This depends on the construction of section 37 of the Act 12 Geo. III. cap. 72, providing that ‘no bill or note shall be effectual to produce diligence or action, unless the diligence be raised or action commenced within six years from and after the terms at which the sums in the said bills or notes become exigible.’ I am of opinion that the sum in a bill or note like this does not become exigible till the expiration of the period after the date of demand, and therefore that the prescriptive period does not begin to run till then. It was contended that the present case is governed by the principle of the decision in Stephenson v. Stephenson's Trustees, 1807, M. Bills of Exchange, App. No. 20, where it was held that in a bill payable on demand prescription runs from its date. Without entering into the grounds of that decision I think it enough to say that to make the period of prescription run from a certain time after the date of such a bill as that in the present case, and not from the expiration of that period after demand, would, in my opinion, be to make it run from a different date from that when the bill was exigible. The view I take is in accordance with the well-settled rule in England, and although I have proceeded simply on a construction of the Act of 1772 there is obvious expediency in having the rule in Scotland the same as in England.

“As regards the question of stamp the note as produced in process is duly stamped, and the fact, if it be one, that at some period of its currency it was not duly stamped would not render it null. If indeed the pursuer had received it in payment or otherwise not duly stamped, he might, under the 54th section of the Stamp Act, have been disabled from recovering on it, but no averment to that effect is made. The plea of nullity must therefore be repelled.”

The defender appealed, and argued—(1) The bill was dated 1st May 1876, and was prescribed by reason of the sexennial limitation. The pursuer in support of his contention that prescription ran from the end of three months after notice could only found on English cases, viz., Thorpe v. Coombe, 1826, 8 Dowling & Bylands, 347, and Clayton v. Gosling, ibidem, p. 110; Byles on Bills, p. 358. The case of Stephenson v. Stephenson's Trustees, June 10, 1807, M. Bill of Exchange, Appen. Part 1, p. 25, was in point. In a bill payable on demand the period of prescription ran from its date—1 Bell's Com. 7th ed. p. 418. (2) He offered to prove that the note had been presented for payment to the Bank of Scotland without a stamp, and once that was shown then the note was null and void. If this were not so the result would be that foreign bills might be presented any number of times without any stamp at all. [ Lord Craighill—One presentment kills the bill?]—Yes. Section 17 of the Stamp Acts 1870 made an unstamped instrument inadmissible or available in law or equity. By sec. 51, subsec. 4, a holder was not relieved from any penalty incurred by him for not cancelling any adhesive stamp (as provided in preceding section). Sec. 54 fixed a penalty of £10 for issuing or presenting for payment any unstamped note. Under these sections, then, the defender would have made himself liable in a penalty if he had negotiated the note in its unstamped condition.

Counsel for pursuer was not called on.

At advising—