Part IIICheques on a banker

An Act relating to Bills of Exchange, Cheques and Promissory Notes ## Part I—Preliminary #### 1 Short title \[see Note 1\] This Act may be cited as the Bills of Exchange Act 1909. #### 2 Commencement \[see Note 1\] This Act shall commence on a day to be fixed by proclamation. #### 4 Interpretation of terms In this Act, unless the context otherwise requires: > Acceptance means an acceptance completed by delivery or notification. > Action includes counter‑claim and set‑off. > Australasia means Australia, and any Territory, New Zealand, and the Fiji Islands. > Banker includes a body of persons, whether incorporated or not, who carry on the business of banking. > Bankrupt means any person whose estate is vested in a trustee or assignee under the law for the time being in force relating to bankruptcy or insolvency. > Bearer means the person in possession of a bill or note which is payable to bearer. > Bill means bill of exchange. > Delivery means transfer of possession, actual or constructive, from one person to another. > Holder means the payee or indorsee of a bill or note who is in possession of it, or the bearer thereof. > Indorsement means an indorsement completed by delivery. > Issue means the first delivery of a bill or note, complete in form, to a person who takes it as a holder. > Note means promissory note. > Person includes a body of persons whether incorporated or not. > Value means valuable consideration. > Written includes printed, and writing includes print. #### 5 Application of rules of bankruptcy and common law (1) The rules in bankruptcy relating to bills of exchange, cheques, and promissory notes, shall continue to apply thereto notwithstanding anything in this Act contained. (2) The rules of common law, including the law merchant, save in so far as they are inconsistent with the express provisions of this Act, shall continue to apply to bills of exchange, cheques, and promissory notes. #### 6 Application of Act (1) This Act does not apply to bills of exchange, cheques, and promissory notes drawn issued or made before the commencement of this Act. (2) This Act does not apply to an instrument to which the Cheques Act 1986 applies. #### 7 Application of State laws The State Acts set out in the First Schedule shall, to the extent specified in that Schedule, cease to apply to bills of exchange, cheques, and promissory notes drawn or made after the commencement of this Act. ## Part II—Bills of exchange ### Division 1—Form and interpretation #### 8 Bill of exchange defined (1) A bill of exchange is an unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand, or at a fixed or determinable future time, a sum certain in money to or to the order of a specified person, or to bearer. (2) An instrument which does not comply with these conditions, or which orders any act to be done in addition to the payment of money, is not a bill of exchange. (3) An order to pay out of a particular fund is not unconditional within the meaning of this section; but an unqualified order to pay, coupled with: (a) an indication of a particular fund out of which the drawee is to re‑imburse himself or herself, or a particular account to be debited with the amount; or (b) a statement of the transaction which gives rise to the bill; is unconditional. (4) A bill is not invalid by reason: (a) that it is not dated; (b) that it does not specify the value given, or that any value has been given therefor; or (c) that it does not specify the place where it is drawn, or the place where it is payable. #### 9 Inland and foreign bills (1) An inland bill is a bill which is, or on the face of it purports to be: (a) both drawn and payable within Australasia; or (b) drawn within Australasia upon some person resident therein. > Any other bill is a foreign bill. (2) Unless the contrary appear on the face of the bill, the holder may treat it as an inland bill. #### 10 Effect where different parties to bill are the same person (1) A bill may be drawn payable to, or to the order of, the drawer; or it may be drawn payable to, or to the order of, the drawee. (2) Where, in a bill, drawer and drawee are the same person, or where the drawee is a fictitious person or a person not having capacity to contract, the holder may treat the instrument, at his or her option, either as a bill of exchange or as a promissory note. #### 11 Address to drawee (1) The drawee must be named or otherwise indicated in a bill with reasonable certainty. (2) A bill may be addressed to two or more drawees, whether they are partners or not, but an order addressed to two drawees in the alternative, or to two or more drawees in succession, is not a bill of exchange. #### 12 Certainty required as to payee (1) Where a bill is not payable to bearer, the payee must be named or otherwise indicated therein with reasonable certainty. (2) A bill may be made payable to two or more payees jointly, or it may be made payable in the alternative to one of two, or one or some of several payees. A bill may also be made payable to the holder of an office for the time being. (3) Where the payee is a fictitious or non‑existing person, the bill may be treated as payable to bearer. #### 13 What bills are negotiable (1) When a bill contains words prohibiting transfer, or indicating an intention that it should not be transferable, it is valid as between the parties thereto, but is not negotiable. (2) A negotiable bill may be payable either to order or to bearer. (3) A bill is payable to bearer which is expressed to be so payable, or on which the only or last indorsement is an indorsement in blank. (4) A bill is payable to order which: (a) is expressed to be so payable; or (b) is expressed to be payable to a particular person, and does not contain words prohibiting transfer or indicating an intention that it should not be transferable. (5) Where a bill, either originally or by indorsement, is expressed to be payable to the order of a specified person, and not to the person or his or her order, it is nevertheless payable to the person or his or her order at his or her option. #### 14 Sum payable (1) The sum payable by a bill is a sum certain within the meaning of this Act, although it is required to be paid with, by or according to, as the case requires, any one or more of the following, namely: (a) interest or bank charges; or (b) stated instalments; or (c) stated instalments, with a provision that upon default in payment of any instalment the whole shall become due; or (d) an indicated rate of exchange, or a rate of exchange to be ascertained as directed by the bill. (2) Where more than one sum is expressed to be payable in a bill, the lesser or least, as the case may be, of the sums so expressed to be payable shall be taken to be the only sum ordered to be paid by the bill. (3) Where a bill is expressed to be payable with interest, unless the instrument otherwise provides, interest runs from the date of the bill, and if the bill is undated from the issue thereof. #### 15 Bill payable on demand (1) A bill is payable on demand: (a) which is expressed to be payable on demand, or at sight, or on presentation; or (b) in which no time for payment is expressed. (2) Where a bill is accepted or indorsed when it is overdue, it shall, as regards the acceptor who so accepts, or any indorser who so indorses it, be deemed a bill payable on demand. #### 16 Bill payable at a future time A bill is payable at a determinable future time within the meaning of this Act which is expressed to be payable: (a) at a fixed period after date or sight; or (b) on or at a fixed period after the occurrence of a specified event which is certain to happen, though the time of happening may be uncertain. An instrument expressed to be payable on a contingency is not a bill, and the happening of the event does not cure the defect. #### 17 Omission of date in bill payable after date Where a bill expressed to be payable at a fixed period after date is issued undated, or where the acceptance of a bill payable at a fixed period after sight is undated, any holder may insert therein the true date of issue or acceptance, and the bill shall be payable accordingly: Provided that: (a) where the holder in good faith and by mistake inserts a wrong date; and (b) in every case where a wrong date is inserted, if the bill subsequently comes into the hands of a holder in due course; the bill shall not be avoided thereby, but shall operate and be payable as if the date so inserted had been the true date. #### 18 Ante‑dating and post‑dating (1) Where a bill or an acceptance or any indorsement on a bill is dated, the date shall, unless the contrary be proved, be deemed to be the true date of the drawing, acceptance, or indorsement, as the case may be. (2) A bill is not invalid by reason only that it is ante‑dated or post‑dated, or that it bears date on a Sunday. #### 19 Computation of time of payment (1) A bill that is not payable on demand falls due for payment on the last day of the time of payment fixed by the bill. (2) In working out the time of payment fixed by a bill the following rules apply: (b) Where a bill is payable at a fixed period after date, after sight, or after the happening of a specified event, the time of payment is determined by excluding the day from which the time is to begin to run and by including the day of payment. (c) Where a bill is payable at a fixed period after sight, the time begins to run from the date of the acceptance if the bill be accepted, and from the date of noting or protest if the bill be noted or protested for non‑acceptance, or for non‑delivery. (d) The term month in a bill means a period starting at the start of any day of one of the calendar months and ending: (i) immediately before the start of the corresponding day of the next calendar month; or (ii) if there is no such day—at the end of the next calendar month. #### 20 Case of need The drawer of a bill, and any indorser, may insert therein the name of a person to whom the holder may resort in case of need, that is to say, in case the bill is dishonoured by non‑acceptance or non‑payment. Such person is called the referee in case of need. It is in the option of the holder to resort to the referee in case of need or not as he or she may think fit. #### 21 Optional stipulation by drawer or indorser The drawer of a bill, and any indorser, may insert therein an express stipulation: (a) negativing or limiting his or her own liability to the holder; or (b) waiving as regards himself or herself some or all of the holder’s duties. #### 22 Definition and requisites of acceptance (1) The acceptance of a bill is the signification by the drawee of his or her assent to the order of the drawer. (2) An acceptance is invalid unless it complies with the following conditions, namely: (a) It must be written on the bill and be signed by the drawee. The mere signature of the drawee, without additional words, is sufficient. (b) It must not express that the drawee will perform his or her promise by any other means than the payment of money. #### 23 Time for acceptance (1) A bill may be accepted: (a) before it has been signed by the drawer, or while otherwise incomplete; (b) when it is overdue, or after it has been dishonoured by a previous refusal to accept, or by non‑payment. (2) When a bill payable after sight is dishonoured by non‑acceptance and the drawee subsequently accepts it, the holder, in the absence of any different agreement, is entitled to have the bill accepted as of the date of first presentment to the drawee for acceptance. #### 24 General and qualified acceptances (1) An acceptance is either: (a) general; or (b) qualified. (2) A general acceptance assents without qualification to the order of the drawer. A qualified acceptance in express terms varies the effect of the bill as drawn. (3) In particular an acceptance is qualified which is: (a) conditional, that is to say, which makes payment by the acceptor dependent on the fulfilment of a condition therein stated; or (b) partial, that is to say, an acceptance to pay part only of the amount for which the bill is drawn; or (c) local, that is to say, an acceptance to pay only at a particular specified place; or (d) qualified as to time; or (e) the acceptance of some one or more of the drawees, but not of all. (4) An acceptance to pay at a particular place is a general acceptance, unless it expressly states that the bill is to be paid there only, and not elsewhere. #### 25 Inchoate instruments (1) Where a simple signature on a blank stamped paper stamped with an impress duty stamp is delivered by the signer in order that it may be converted into a bill, it operates as a prima facie authority to fill it up as a complete bill for any amount the stamp will cover, using the signature for that of the drawer or the acceptor or an indorser. (2) And in like manner when a bill is wanting in any material particular, the person in possession of it has a prima facie authority to fill up the omission in any way he or she thinks fit. (3) In order that any such instrument when completed may be enforceable against any person who became a party thereto prior to its completion, it must be filled up within a reasonable time, and strictly in accordance with the authority given. Reasonable time for this purpose is a question of fact: Provided that, if any such instrument after completion is negotiated to a holder in due course, it shall be valid and effectual for all purposes in his or her hands, and he or she may enforce it as if it had been filled up within a reasonable time and strictly in accordance with the authority given. (4) For the purposes of subsection (1) of this section, duty stamp includes a duty stamp, required, by the law of the State in which the instrument is issued, to be impressed on a bill. #### 26 Delivery (1) Every contract on a bill, whether it be the drawer’s, the acceptor’s, or an indorser’s, is incomplete and revocable, until delivery of the instrument in order to give effect thereto: Provided that where an acceptance is written on a bill, and the drawee gives notice to or according to the directions of the person entitled to the bill that he or she has accepted it, the acceptance then becomes complete and irrevocable. (2) As between immediate parties, and as regards a remote party other than a holder in due course, the delivery: (a) in order to be effectual, must be made either by or under the authority of the party drawing, accepting, or indorsing, as the case may be; or (b) may be shown to have been conditional or for a special purpose only, and not for the purpose of transferring the property in the bill. But if the bill be in the hands of a holder in due course, a valid delivery of the bill by all parties prior to him or her, so as to make them liable to him or her, is conclusively presumed. (3) Where a bill is no longer in the possession of a party who has signed it as a drawer, acceptor, or indorser, a valid and unconditional delivery by him or her is presumed until the contrary is proved. ### Division 2—Capacity and authority of parties #### 27 Capacity of parties (1) Capacity to incur liability as a party to a bill is co‑extensive with capacity to contract: Provided that nothing in this section shall enable a corporation to make itself liable as drawer, acceptor, or indorser of a bill, unless it is competent to it so to do under the law for the time being in force relating to corporations. (2) Where a bill is drawn or indorsed by an infant or corporation having no capacity or power to incur liability on a bill, the drawing or indorsement entitles the holder to receive payment of the bill, and to enforce it against any other party thereto. #### 28 Signature essential to liability (1) Subject to this section, a person is not liable as drawer, indorser or acceptor of a bill if he or she has not signed it as such. (2) Where a person signs a bill in a trade name or an assumed name, he or she is liable on the bill as if he or she had signed it in his or her own name. (3) The signature of the name of a firm is equivalent to the signature, by the person so signing, of the names of all persons liable as partners in that firm. #### 29 Forged or unauthorized signature Subject to the provisions of this Act, where a signature on a bill is forged or placed thereon without the authority of the person whose signature it purports to be, the forged or unauthorized signature is wholly inoperative, and no right to retain the bill or to give a discharge therefor or to enforce payment thereof against any party thereto can be acquired through or under that signature, unless the party against whom it is sought to retain or enforce payment of the bill is precluded from setting up the forgery or want of authority: Provided that nothing in this section shall affect the ratification of an unauthorized signature not amounting to a forgery. #### 30 Procuration signatures A signature by procuration operates as notice that the agent has but a limited authority to sign, and the principal is only bound by such signature if the agent in so signing was acting within the actual limits of his or her authority. #### 31 Person signing as agent or in representative capacity (1) Where a person signs a bill as drawer, indorser, or acceptor, and adds words to his or her signature, indicating that he or she signs for or on behalf of a principal, or in a representative character, he or she is not personally liable thereon; but the mere addition to his or her signature of words describing him or her as an agent, or as filling a representative character, does not exempt him or her from personal liability. (2) In determining whether a signature on a bill is that of the principal or that of the agent by whose hand it is written, the construction most favourable to the validity of the instrument shall be adopted. ### Division 3—The consideration for a bill #### 32 Value and holder for value (1) Valuable consideration for a bill may be constituted by: (a) any consideration sufficient to support a simple contract; or (b) an antecedent debt or liability. Such a debt or liability is deemed valuable consideration whether the bill is payable on demand or at a future time. (2) Where value has at any time been given for a bill, the holder is deemed to be a holder for value as regards the acceptor and all parties to the bill who became parties prior to such time. (3) Where the holder of a bill has a lien on it, arising either from contract or by implication of law, he or she is deemed to be a holder for value to the extent of the sum for which he or she has a lien. #### 33 Accommodation bill or party (1) An accommodation party to a bill is a person who has signed a bill as drawer, acceptor, or indorser, without receiving value therefor, and for the purpose of lending his or her name to some other person. (2) An accommodation party is liable on the bill to a holder for value; and it is immaterial whether, when such holder took the bill, he or she knew such party to be an accommodation party or not. #### 34 Holder in due course (1) A holder in due course is a holder who has taken a bill, complete and regular on the face of it, under the following conditions, namely: (a) That he or she became the holder of it before it was overdue, and without notice that it had been previously dishonoured, if such was the fact; and (b) That he or she took the bill in good faith and for value, and that at the time the bill was negotiated to him or her he or she had no notice of any defect in the title of the person who negotiated it. (2) In particular the title of a person who negotiates a bill is defective within the meaning of this Act when he or she obtained the bill, or the acceptance thereof, by fraud, duress, or force and fear, or other unlawful means, or for an illegal consideration, or when he or she negotiates it in breach of faith, or under such circumstances as amount to a fraud. (3) A holder (whether for value or not) who derives his or her title to a bill through a holder in due course, and who is not himself or herself a party to any fraud or illegality affecting it, has all the rights of that holder in due course as regards the acceptor and all parties to the bill prior to that holder. #### 35 Presumption of value and good faith (1) Every party whose signature appears on a bill is prima facie deemed to have become a party thereto for value. (2) Every holder of a bill is prima facie deemed to be a holder in due course; but if, in an action on a bill, it is admitted or proved that the acceptance, issue, or subsequent negotiation of the bill is affected with fraud, duress, or force and fear, or illegality, the burden of proof is shifted, unless and until the holder proves that, subsequent to the alleged fraud or illegality, value has in good faith been given for the bill. ### Division 4—Negotiation of bills #### 36 Negotiation of bill (1) A bill is negotiated when it is transferred from one person to another in such a manner as to constitute the transferee the holder of the bill. (2) A bill payable to bearer is negotiated by delivery. (3) A bill payable to order is negotiated by the indorsement of the holder completed by delivery. (4) Where the holder of a bill payable to his or her order transfers it for value without indorsing it, the transfer gives the transferee such title as the transferor had in the bill, and the transferee in addition acquires the right to have the indorsement of the transferor. (5) Where any person is under obligation to indorse a bill in a representative capacity, he or she may indorse the bill in such terms as to negative personal liability. #### 37 Requisites of a valid indorsement An indorsement, in order to operate as a negotiation, must comply with the following conditions, namely: (a) It must be written on the bill itself and be signed by the indorser. The simple signature of the indorser on the bill, without additional words, is sufficient. An indorsement written on an allonge, or on a “copy” of a bill issued or negotiated in a country where “copies” are recognized, is deemed to be written on the bill itself. (b) It must be an indorsement of the entire bill. A partial indorsement, that is to say, an indorsement which purports to transfer to the indorsee a part only of the amount payable, or which purports to transfer the bill to two or more indorsees severally, does not operate as a negotiation of the bill. (c) Where a bill is payable to the order of two or more payees or indorsees who are not partners, all must indorse, unless the one indorsing has authority to indorse for the others. (d) Where, in a bill payable to order, the payee or indorsee is wrongly designated, or his or her name is mis‑spelt, he or she may indorse the bill as therein described, adding, if he or she thinks fit, his or her proper signature. (e) Where there are two or more indorsements on a bill, each indorsement is deemed to have been made in the order in which it appears on the bill, until the contrary is proved. (f) An indorsement may be made in blank or special. It may also contain terms making it restrictive. #### 38 Conditional indorsement Where a bill purports to be indorsed conditionally, the condition may be disregarded by the payer, and payment to the indorsee is valid whether the condition has been fulfilled or not. #### 39 Indorsement in blank and special indorsement (1) An indorsement in blank specifies no indorsee, and a bill so indorsed becomes payable to bearer. (2) A special indorsement specifies the person to whom, or to whose order, the bill is to be payable. (3) The provisions of this Act relating to a payee apply, with the necessary modifications, to an indorsee under a special indorsement. (4) When a bill has been indorsed in blank, any holder may convert the blank indorsement into a special indorsement by writing, above the indorser’s signature, a direction to pay the bill to or to the order of himself, herself or some other person. #### 40 Restrictive indorsement (1) An indorsement is restrictive which prohibits the further negotiation of the bill, or which expresses that it is a mere authority to deal with the bill as thereby directed and not a transfer of the ownership thereof, as, for example, if a bill be indorsed “Pay D. only,” or “Pay D. for the account of X.,” or “Pay D. or order for collection.” (2) A restrictive indorsement gives the indorsee the right to receive payment of the bill, and to sue any party thereto that his or her indorser could have sued, but gives the indorsee no power to transfer his or her rights as indorsee unless it expressly authorizes the indorsee to do so. (3) Where a restrictive indorsement authorizes further transfer, all subsequent indorsees take the bill with the same rights and subject to the same liabilities as the first indorsee under the restrictive indorsement. #### 41 Negotiation of overdue or dishonoured bill (1) Where a bill is negotiable in its origin, it continues to be negotiable until it has been: (a) restrictively indorsed; or (b) discharged by payment or otherwise. (2) Where an overdue bill is negotiated, it can only be negotiated subject to any defect of title affecting it at its maturity, and thenceforward no person who takes it can acquire or give a better title than that which the person from whom he or she took it had. (3) A bill payable on demand is deemed to be overdue, within the meaning and for the purposes of this section, when it appears on the face of it to have been in circulation for an unreasonable length of time. What is an unreasonable length of time for this purpose is a question of fact. (4) Except where an indorsement bears date after the maturity of the bill, every negotiation is prima facie deemed to have been effected before the bill was overdue. (5) Where a bill which is not overdue has been dishonoured, any person who takes it with notice of the dishonour takes it subject to any defect of title attaching thereto at the time of dishonour, but nothing in this subsection shall affect the rights of a holder in due course. #### 42 Negotiation of bill to party already liable thereon Where a bill is negotiated back to the drawer, or to a prior indorser, or to the acceptor, he or she may, subject to the provisions of this Act, re‑issue and further negotiate the bill, but he or she is not entitled to enforce payment of the bill against any intervening party to whom he or she was previously liable. #### 43 Rights of holder (1) The rights and powers of the holder of a bill are as follows: (a) He or she may sue on the bill in his or her own name; (b) Where he or she is a holder in due course, he or she holds the bill free from any defect of title of prior parties, as well as from mere personal defences available to prior parties among themselves, and may enforce payment against all parties liable on the bill. (2) Where a holder’s title is defective: (a) if he or she negotiates the bill to a holder in due course, that holder obtains a good and complete title to the bill; and (b) if he or she obtains payment of the bill, the person who pays him or her in due course gets a valid discharge for the bill. ### Division 5—General duties of the holder #### 44 When presentment for acceptance is necessary (1) Where a bill is payable after sight, presentment for acceptance is necessary in order to fix the maturity of the instrument. (2) Where a bill expressly stipulates that it shall be presented for acceptance, or where a bill is drawn payable elsewhere than at the residence or place of business of the drawee, it must be presented for acceptance before it can be presented for payment. (3) In no other case is presentment for acceptance necessary in order to render liable any party to the bill. (4) Where the holder of a bill, drawn payable elsewhere than at the place of business or residence of the drawee, has not time, with the exercise of reasonable diligence, to present the bill for acceptance before presenting it for payment on the day that it falls due, the delay caused by presenting the bill for acceptance before presenting it for payment is excused, and does not discharge the drawer and indorsers. #### 45 Time for presenting bill payable after sight (1) Subject to the provisions of this Act, when a bill payable after sight is negotiated, the holder must either present it for acceptance or negotiate it within a reasonable time. (2) If the holder does not do so, the drawer and all indorsers prior to that holder are discharged. (3) In determining what is a reasonable time within the meaning of this section, regard shall be had to the nature of the bill, the usage of trade with respect to similar bills, and the facts of the particular case. #### 46 Rules as to presentment for acceptance and excuses for non‑presentment (1) A bill is duly presented for acceptance which is presented in accordance with the following rules: (a) The presentment must be made, by or on behalf of the holder, to the drawee or to some person authorized to accept or refuse acceptance on his or her behalf, at a reasonable hour on a business day and before the bill is overdue; (b) Where a bill is addressed to two or more drawees, who are not partners, presentment must be made to them all, unless one has authority to accept for all, then presentment may be made to him or her only; (c) Where the drawee is dead, presentment may be made to his or her personal representative; (d) Where the drawee is bankrupt, presentment may be made to him or her or to his or her trustee or assignee; (e) Where authorized by agreement or usage, a presentment through the post office is sufficient. (2) Presentment in accordance with these rules is excused, and a bill may be treated as dishonoured by non‑acceptance: (a) where the drawee is dead or bankrupt, or is a fictitious person or a person not having capacity to contract by bill; (b) where, after the exercise of reasonable diligence, such presentment cannot be effected; (c) where, although the presentment has been irregular, acceptance has been refused on some other ground. (3) The fact that the holder has reason to believe that the bill, on presentment, will be dishonoured does not excuse presentment. #### 47 Non‑acceptance When a bill is duly presented for acceptance and is not accepted within the customary time, the person presenting it must treat it as dishonoured by non‑acceptance. If the person does not, the holder shall lose his or her right of recourse against the drawer and indorsers. #### 48 Dishonour by non‑acceptance and its consequences (1) A bill is dishonoured by non‑acceptance: (a) when it is duly presented for acceptance, and such an acceptance as is prescribed by this Act is refused or cannot be obtained; or (b) when presentment for acceptance is excused, and the bill is not accepted. (2) Subject to the provisions of this Act, when a bill is dishonoured by non‑acceptance, an immediate right of recourse against the drawer and indorsers accrues to the holder, and no presentment for payment is necessary. #### 49 Duties as to qualified acceptances (1) The holder of a bill may refuse to take a qualified acceptance, and if he or she does not obtain an unqualified acceptance may treat the bill as dishonoured by non‑acceptance. (2) Where a qualified acceptance is taken, and the drawer or an indorser has not expressly or impliedly authorized the holder to take a qualified acceptance, or does not subsequently assent thereto, such drawer or indorser is discharged from his or her liability on the bill. The provisions of this subsection do not apply to a partial acceptance, whereof due notice has been given. Where a foreign bill has been accepted as to part, it must be protested as to the balance. (3) When the drawer or indorser of a bill receives notice of a qualified acceptance, and does not within a reasonable time express his or her dissent to the holder, he or she shall be deemed to have assented thereto. #### 50 Rules as to presentment for payment (1) Subject to the provisions of this Act, a bill must be duly presented for payment. If it be not so presented, the drawer and indorsers shall be discharged. (2) A bill is duly presented for payment which is presented in accordance with the following rules: (a) Where the bill is not payable on demand, presentment must be made on the day it falls due. (b) Where the bill is payable on demand, then, subject to the provisions of this Act, presentment must be made within a reasonable time after its issue, in order to render the drawer liable, and within a reasonable time after its indorsement, in order to render the indorser liable. In determining what is a reasonable time, regard shall be had to the nature of the bill, the usage of trade with regard to similar bills, and the facts of the particular case. (c) Presentment must be made by the holder or by some person authorized to receive payment on his or her behalf, at a reasonable hour on a business day, at the proper place as defined in this section, either to the person designated by the bill as payer, or to some person authorized to pay or refuse payment on his or her behalf, if with the exercise of reasonable diligence such person can there be found. (d) A bill is presented at the proper place: (i) where a place of payment is specified in the bill and the bill is there presented; (ii) where no place of payment is specified, but the address of the drawee or acceptor is given in the bill, and the bill is there presented; (iii) where no place of payment is specified and no address given, and the bill is presented at the drawee’s or acceptor’s place of business if known, and if not at his or her ordinary residence if known; (iv) in any other case, if presented to the drawee or acceptor wherever he or she can be found, or if presented at his or her last known place of business or residence. (e) Where a bill is presented at the proper place, and after the exercise of reasonable diligence no person authorized to pay or refuse payment can be found there, no further presentment to the drawee or acceptor is required. (f) Where a bill is drawn upon or accepted by two or more persons who are not partners, and no place of payment is specified, presentment must be made to them all. (g) Where the drawee or acceptor of a bill is dead, and no place of payment is specified, presentment must be made to a personal representative, if such there be, and with the exercise of reasonable diligence he or she can be found. (h) Where authorized by agreement or usage, a presentment through the post office is sufficient. #### 51 Excuses for delay or non‑presentment for payment (1) Delay in making presentment for payment is excused when the delay is caused by circumstances beyond the control of the holder, and not imputable to his or her default, misconduct, or negligence. When the cause of delay ceases to operate, presentment must be made with reasonable diligence. (2) Presentment for payment is dispensed with: (a) where, after the exercise of reasonable diligence, presentment, as required by this Act, cannot be effected. The fact that the holder has reason to believe that the bill will, on presentment, be dishonoured, does not dispense with the necessity for presentment. (b) where the drawee is a fictitious person; (c) as regards the drawer, where the drawee or acceptor is not bound, as between himself or herself and the drawer, to accept or pay the bill, and the drawer has no reason to believe that the bill would be paid if presented; (d) as regards an indorser, where the bill was accepted or made for the accommodation of that indorser, and he or she has no reason to expect that the bill would be paid if presented; (e) by waiver of presentment, express or implied. #### 52 Dishonour by non‑payment (1) A bill is dishonoured by non‑payment: (a) when it is duly presented for payment and payment is refused or cannot be obtained; or (b) when presentment is excused and the bill is overdue and unpaid. (2) Subject to the provisions of this Act, when a bill is dishonoured by non‑payment, an immediate right of recourse against the drawer and indorsers accrues to the holder. #### 53 Notice of dishonour and effect of non‑notice Subject to the provisions of this Act, when a bill has been dishonoured by non‑acceptance or by non‑payment, notice of dishonour must be given to the drawer and each indorser, and any drawer or indorser to whom such notice is not given is discharged: Provided that: (a) where a bill is dishonoured by non‑acceptance, and notice of dishonour is not given, the rights of a holder in due course, subsequent to the omission, shall not be prejudiced by the omission; and (b) where a bill is dishonoured by non‑acceptance, and due notice of dishonour is given, it shall not be necessary to give notice of a subsequent dishonour by non‑payment, unless the bill has in the meantime been accepted. #### 54 Rules as to notice of dishonour Notice of dishonour, in order to be valid and effectual, must be given in accordance with the following rules: (a) The notice must be given by or on behalf of the holder, or by and on behalf of an indorser who, at the time of giving it, is himself or herself liable on the bill. (b) Notice of dishonour may be given by an agent, either in his or her own name, or in the name of any party entitled to give notice, whether that party is his or her principal or not. (c) Where the notice is given by or on behalf of the holder, it enures for the benefit of all subsequent holders and all prior indorsers who have a right of recourse against the party to whom it is given. (d) Where notice is given by or on behalf of an indorser entitled to give notice as hereinbefore provided, it enures for the benefit of the holder and all indorsers subsequent to the party to whom notice is given. (e) The notice may be given in writing or by personal communication, and may be given in any terms which sufficiently identify the bill, and intimate that the bill has been dishonoured by non‑acceptance or non‑payment. (f) The return of a dishonoured bill to the drawer or an indorser is, in point of form, deemed a sufficient notice of dishonour. (g) A written notice need not be signed, and an insufficient written notice may be supplemented and validated by verbal communication. A misdescription of the bill shall not vitiate the notice unless the party to whom the notice is given is in fact misled thereby. (h) Where notice of dishonour is required to be given to any person, it may be given either to the party, or to his or her agent in that behalf. (i) Where the drawer or indorser is dead, and the party giving notice knows it, the notice must be given to a personal representative, if such there be, and with the exercise of reasonable diligence he or she can be found. (j) Where the drawer or indorser is bankrupt, notice may be given either to the party, or to the trustee or assignee. (k) Where there are two or more drawers or indorsers who are not partners, notice must be given to each of them, unless one of them has authority to receive such notice for the others. (l) The notice may be given as soon as the bill is dishonoured, and must be given within a reasonable time thereafter. In the absence of special circumstances, notice is not deemed to have been given within a reasonable time, unless: (i) where the person giving and the person to receive notice reside in the same place, the notice is given or sent off in time to reach the latter on the day after the dishonour of the bill; or (ii) where the person giving and the person to receive notice reside in different places, the notice is sent off on the day after the dishonour of the bill, if there is a post at a convenient hour on that day, and if there is no such post on that day then by the next post thereafter. (m) Where a bill when dishonoured is in the hands of an agent, the agent may either give notice to the parties liable on the bill or the agent may give notice to his or her principal. If the agent gives notice to his or her principal, the agent must do so within the same time as if the agent were the holder, and the principal upon receipt of such notice has the same time for giving notice as if the agent had been an independent holder. (n) Where a party to a bill receives due notice of dishonour, he or she has, after the receipt of such notice, the same period of time for giving notice to antecedent parties that the holder has after the dishonour. (o) Where a notice of dishonour is duly addressed and posted the sender is deemed to have given due notice of dishonour, notwithstanding any miscarriage by the post‑office. #### 55 Excuses for non‑notice and delay (1) Delay in giving notice of dishonour is excused where the delay is caused by circumstances beyond the control of the party giving notice, and not imputable to his or her default, misconduct, or negligence. When the cause of delay ceases to operate, the notice must be given with reasonable diligence. (2) Notice of dishonour is dispensed with: (a) when, after the exercise of reasonable diligence, notice as required by this Act cannot be given to or does not reach the drawer or indorser sought to be charged; (b) by waiver express or implied. Notice of dishonour may be waived before the time of giving notice has arrived, or after the omission to give due notice; (c) as regards the drawer, in the following cases, namely: (i) where drawer and drawee are the same person; (ii) where the drawee is a fictitious person or a person not having capacity to contract; (iii) where the drawer is the person to whom the bill is presented for payment; (iv) where the drawee or acceptor is, as between himself or herself and the drawer, under no obligation to accept or pay the bill; (v) where the drawer has countermanded payment: (d) as regards the indorser, in the following cases, namely: (i) where the drawee is a fictitious person or a person not having capacity to contract, and the indorser was aware of the fact at the time he or she indorsed the bill; (ii) where the indorser is the person to whom the bill is presented for payment; and (iii) where the bill was accepted or made for his or her accommodation. #### 56 Noting or protest of bill (1) Where an inland bill has been dishonoured, it may, if the holder think fit, be noted for non‑acceptance or non‑payment, as the case may be; but it shall not be necessary to note or protest any such bill in order to preserve the recourse against the drawer or indorser. (2) Where a foreign bill, appearing on the face of it to be such, has been dishonoured by non‑acceptance, it must be duly protested for non‑acceptance, and where such a bill, which has not been previously dishonoured by non‑acceptance, is dishonoured by non‑payment, it must be duly protested for non‑payment. If it is not so protested, the drawer and indorsers are discharged. Where a bill does not appear on the face of it to be a foreign bill, protest thereof in case of dishonour is unnecessary. (3) A bill which has been protested for non‑acceptance may be subsequently protested for non‑payment. (4) Subject to the provisions of this Act, when a bill is noted or protested, it must be noted within 48 hours after its dishonour. When a bill has been duly noted, the protest may be subsequently extended as of the date of the noting. (5) Where the acceptor of a bill becomes bankrupt or insolvent or suspends payment before it matures, the holder may cause the bill to be protested for better security against the drawer and indorsers. (6) A bill must be protested at the place where it is dishonoured: Provided that: (a) when a bill is presented through the post‑office and returned by post dishonoured, it may be protested at the place to which it is returned not later than the next business day after the day of its return; (b) when a bill, drawn payable at the place of business or residence of some person other than the drawee, has been dishonoured by non‑acceptance, it must be protested for non‑payment at the place where it is expressed to be payable, and no further presentment for payment to, or demand on, the drawee is necessary. (7) A protest must contain a copy of the bill, and must be signed by the notary or person making it, and must specify: (a) the person at whose request the bill is protested; (b) the place and date of protest, the cause or reason for protesting the bill, the demand made, and the answer given, if any, or the fact that the drawee or acceptor could not be found. (8) Where a bill is lost or destroyed, or is wrongly detained from the person entitled to hold it, protest may be made on a copy or written particulars thereof. (9) Protest is dispensed with by any circumstance which would dispense with notice of dishonour. Delay in noting or protesting is excused when the delay is caused by circumstances beyond the control of the holder, and not imputable to his or her default, misconduct, or negligence. When the cause of delay ceases to operate, the bill must be noted or protested with reasonable diligence. #### 57 Duties of holder as regards drawee or acceptor (1) When a bill is accepted generally, presentment for payment is not necessary in order to render the acceptor liable. (2) When, by the terms of a qualified acceptance, presentment for payment is required, the acceptor, in the absence of an express stipulation to that effect, is not discharged by the omission to present the bill for payment on the day that it matures. (3) In order to render the acceptor of a bill liable, it is not necessary to protest it, or that notice of dishonour should be given to him or her. (4) Where the holder of a bill presents it for payment, he or she shall exhibit the bill to the person from whom he or she demands payment, and when a bill is paid, the holder shall forthwith deliver it up to the party paying it. ### Division 6—Liabilities of parties #### 58 Funds in hands of drawee A bill, of itself, does not operate as an assignment of funds in the hands of the drawee available for the payment thereof, and the drawee of a bill who does not accept as required by this Act is not liable on the instrument. #### 59 Liability of acceptor The acceptor of a bill, by accepting it: (a) engages that he or she will pay it according to the tenor of his or her acceptance; and (b) is precluded from denying to a holder in due course: (i) the existence of the drawer, the genuineness of his or her signature, and his or her capacity and authority to draw the bill; and (ii) in the case of a bill payable to drawer’s order, the then capacity of the drawer to indorse, but not the genuineness or validity of his or her indorsement; and (iii) in the case of a bill payable to the order of a third person, the existence of the payee and his or her then capacity to indorse, but not the genuineness or validity of his or her indorsement. #### 60 Liability of drawer or indorser (1) The drawer of a bill, by drawing it: (a) engages that on due presentment it shall be accepted and paid according to its tenor, and that if it is dishonoured he or she will compensate the holder or any indorser who is compelled to pay it, provided that the requisite proceedings on dishonour are duly taken; and (b) is precluded from denying to a holder in due course the existence of the payee and his or her then capacity to indorse. (2) The indorser of a bill, by indorsing it: (a) engages that on due presentment it shall be accepted and paid according to its tenor, and that if it is dishonoured he or she will compensate the holder or a subsequent indorser who is compelled to pay it, provided that the requisite proceedings on dishonour are duly taken; and (b) is precluded from denying to a holder in due course the genuineness and regularity in all respects of the drawer’s signature and all previous indorsements; and (c) is precluded from denying to his or her immediate or a subsequent indorsee that the bill was at the time of his or her indorsement a valid and subsisting bill, and that he or she had then a good title thereto. #### 61 Stranger signing bill liable as indorser Where a person signs a bill otherwise than as drawer or acceptor, he or she thereby incurs the liabilities of an indorser to a holder in due course. #### 62 Measure of damages against parties to dishonoured bill Where a bill is dishonoured, the measure of damages, which shall be deemed to be liquidated damages, shall be as follows: (a) The holder may recover from any party liable on the bill and the drawer who has been compelled to pay the bill may recover from the acceptor, and an indorser who has been compelled to pay the bill may recover from the acceptor or from the drawer, or from a prior indorser: (i) the amount of the bill; (ii) interest thereon from the time of presentment for payment if the bill is payable on demand, and from the maturity of the bill in any other case; and (iii) the expenses of noting, or, when protest is necessary, and the protest has been extended, the expenses of protest. (b) In the case of a bill which has been dishonoured abroad, in lieu of the above damages, the holder may recover from the drawer or an indorser, and the drawer or an indorser who has been compelled to pay the bill may recover from any party liable to him or her, the amount of the re‑exchange with interest thereon until the time of payment. (c) Where by this Act interest may be recovered as damages, such interest may, if justice require it, be withheld wholly or in part, and where a bill is expressed to be payable with interest at a given rate, interest as damages may or may not be given at the same rate as interest proper. #### 63 Transferor by delivery and transferee (1) Where the holder of a bill payable to bearer negotiates it by delivery without indorsing it, he or she is called a transferor by delivery. (2) A transferor by delivery is not liable on the instrument. (3) A transferor by delivery who negotiates a bill thereby warrants to his or her immediate transferee being a holder for value that the bill is what it purports to be, that he or she has a right to transfer it, and that at the time of transfer he or she is not aware of any fact which renders it valueless. ### Division 7—Discharge of bill #### 64 Payment in due course (1) A bill is discharged by payment in due course by or on behalf of the drawee or acceptor. > Payment in due course means payment made at or after maturity of the bill to the holder thereof in good faith and without notice that his or her title to the bill is defective. (2) Subject to the provisions hereinafter contained, when a bill is paid by the drawer or an indorser it is not discharged; but: (a) where a bill payable to, or to the order of, a third party is paid by the drawer, the drawer may enforce payment thereof against the acceptor, but may not re‑issue the bill; (b) where a bill is paid by an indorser, or where a bill payable to drawer’s order is paid by the drawer, the party paying it is remitted to his or her former rights as regards the acceptor or antecedent parties, and he or she may, if he or she thinks fit, strike out his or her own and subsequent indorsements, and again negotiate the bill. (3) Where an accommodation bill is paid in due course by the party accommodated, the bill is discharged. #### 65 Banker paying demand draft whereon indorsement is forged (1) When a bill payable to order on demand is drawn on a banker, and the banker on whom it is drawn pays the bill in good faith and in the ordinary course of business, it is not incumbent on the banker to show that the indorsement of the payee or any subsequent indorsement was made by or under the authority of the person whose indorsement it purports to be, and the banker is deemed to have paid the bill in due course, although such indorsement has been forged or made without authority. (2) An order on demand, drawn by or on behalf of a banker at one place of business on and payable by the banker either at the same or at some other place of business, shall, for the purpose of the protection of the banker under this section, be deemed to be a bill payable to order on demand. #### 66 Acceptor the holder at maturity When the acceptor of a bill is or becomes the holder of it at or after its maturity, in his or her own right, the bill is discharged. #### 67 Express waiver (1) When the holder of a bill at or after its maturity absolutely and unconditionally renounces his or her rights against the acceptor, the bill is discharged. (2) The renunciation must be in writing, unless the bill is delivered up to the acceptor. (3) The liabilities of any party to a bill may in like manner be renounced by the holder before, at, or after its maturity; but nothing in this section shall affect the rights of a holder in due course without notice of the renunciation. #### 68 Cancellation (1) Where a bill is intentionally cancelled by the holder or his or her agent, and the cancellation is apparent thereon, the bill is discharged. (2) In like manner any party liable on a bill may be discharged by the intentional cancellation of his or her signature by the holder or his or her agent. In such case any indorser, who would have had a right of recourse against the party whose signature is cancelled, is also discharged. (3) A cancellation made unintentionally, or under a mistake, or without the authority of the holder, is inoperative; but where a bill or any signature thereon appears to have been cancelled, the burden of proof lies on the party who alleges that the cancellation was made unintentionally, or under a mistake, or without authority. #### 69 Alteration of bill (1) Where a bill or acceptance is materially altered without the assent of all parties liable on the bill, the bill is avoided except as against a party who has made, authorized, or assented to the alteration, and subsequent indorsers. Provided that where a bill has been materially altered, but the alteration is not apparent, and the bill is in the hands of a holder in due course, such holder may avail himself or herself of the bill as if it had not been altered, and may enforce payment of it according to its original tenor. (2) In particular the following alterations are material, namely, any alteration of the date, the sum payable, the time of payment, the place of payment, and, where a bill has been accepted generally, the addition of a place of payment without the acceptor’s assent. ### Division 8—Acceptance and payment for honour #### 70 Acceptance for honour supra protest (1) Where a bill of exchange has been protested for dishonour by non‑acceptance, or protested for better security, and is not overdue, any person, not being a party already liable thereon, may, with the consent of the holder, intervene and accept the bill supra protest, for the honour of any party liable thereon, or for the honour of the person for whose account the bill is drawn. (2) A bill may be accepted for honour for part only of the sum for which it is drawn. (3) An acceptance for honour supra protest in order to be valid must: (a) be written on the bill, and indicate that it is an acceptance for honour; and (b) be signed by the acceptor for honour. (4) Where an acceptance for honour does not expressly state for whose honour it is made, it is deemed to be an acceptance for the honour of the drawer. (5) Where a bill payable after sight is accepted for honour, its maturity is calculated from the date of the noting for non‑acceptance, and not from the date of the acceptance for honour. #### 71 Liability of acceptor for honour (1) The acceptor for honour of a bill by accepting it engages that he or she will, on due presentment, pay the bill according to the tenor of his or her acceptance, if it is not paid by the drawee, provided it has been duly presented for payment, and protested for non‑payment, and that he or she receives notice of these facts. (2) The acceptor for honour is liable to the holder, and to all parties to the bill subsequent to the party for whose honour he or she has accepted. #### 72 Presentment to acceptor for honour (1) Where a dishonoured bill has been accepted for honour supra protest, or contains a reference in case of need, it must be protested for non‑payment before it is presented for payment to the acceptor for honour, or referee in case of need. (2) Where the address of the acceptor for honour is in the same place where the bill is protested for non‑payment, the bill must be presented to him or her not later than the day following its maturity; and where the address of the acceptor for honour is in some place other than the place where it was protested for non‑payment, the bill must be forwarded not later than the day following its maturity for presentment to him or her. (3) Delay in presentment or non‑presentment is excused by any circumstance which would excuse delay in presentment for payment or non‑presentment for payment. (4) When a bill of exchange is dishonoured by the acceptor for honour, it must be protested for non‑payment by him or her. #### 73 Payment for honour supra protest (1) Where a bill has been protested for non‑payment, any person may intervene and pay it supra protest for the honour of any party liable thereon, or for the honour of the person for whose account the bill is drawn. (2) Where two or more persons offer to pay a bill for the honour of different parties, the person whose payment will discharge most parties to the bill shall have the preference. (3) Payment for honour supra protest, in order to operate as such and not as a mere voluntary payment, must be attested by a notarial act of honour, which may be appended to the protest or form an extension of it. (4) The notarial act of honour must be founded on a declaration made by the payer for honour, or his or her agent in that behalf, declaring his or her intention to pay the bill for honour, and for whose honour he or she pays. (5) Where a bill has been paid for honour, all parties subsequent to the party for whose honour it is paid are discharged, but the payer for honour is subrogated for, and succeeds to both the rights and duties of, the holder as regards the party for whose honour he or she pays, and all parties liable to that party. (6) The payer for honour, on paying to the holder the amount of the bill and the notarial expenses incidental to its dishonour, is entitled to receive both the bill itself and the protest. If the holder do not on demand deliver them up, he or she shall be liable to the payer for honour in damages. (7) Where the holder of a bill refuses to receive payment supra protest, he or she shall lose his or her right of recourse against any party who would have been discharged by such payment. ### Division 9—Lost instruments #### 74 Replacement of lost or destroyed bill (1) Where: (a) a bill (in this section referred to as the original bill) is lost or destroyed; and (b) the original bill was not, at the time of its loss or destruction, overdue; a person (in this section referred to as the former holder) who was the holder of, or otherwise lawfully in possession of, the original bill at the time of its loss or destruction may, by notice in writing given to the drawer of the original bill, request the drawer to give the former holder a replacement bill to the same tenor as the original bill. (2) The notice is not effective for the purposes of this section unless it contains sufficient particulars of the original bill to enable the drawer to: (a) identify the original bill with reasonable certainty; and (b) draw a replacement bill to the same tenor as the original bill. (3) The drawer may, by notice in writing given to the former holder within 14 days after the day on which the notice under subsection (1) is given to the drawer, request the former holder to give the drawer an indemnity in respect of any loss and expenses that the drawer may reasonably incur by reason of the drawing of a replacement bill to the same tenor as the original bill, and may also request the former holder to provide adequate security for the indemnity. (4) The drawer shall: (a) in a case where the drawer requests the former holder, by notice under subsection (3), to give the drawer an indemnity and also to provide security for the indemnity—within 14 days after the day on which the indemnity is given to the drawer or the day on which the security is provided, whichever last occurs; (b) in a case where the drawer requests the former holder, by notice under subsection (3), to give the drawer an indemnity, but does not also request the former holder to provide security for the indemnity—within 14 days after the day on which the indemnity is given to the drawer; or (c) in any other case—within 14 days after the day on which the notice under subsection (1) is given to the drawer; draw a replacement bill to the same tenor as the original bill and give the replacement bill to the former holder. (5) Where the original bill had been accepted before its loss or destruction, the former holder may give the replacement bill to the acceptor and request the acceptor, by notice in writing, to accept the replacement bill to the same tenor as the acceptor’s acceptance of the original bill. (6) The acceptor may, by notice in writing given to the former holder within 14 days after the day on which the notice under subsection (5) is given to the acceptor, request the former holder to give the acceptor an indemnity in respect of any loss and expenses that the acceptor may reasonably incur by reason of the accepting of the bill to the same tenor as the acceptor’s acceptance of the original bill, and may also request the former holder to provide adequate security for the indemnity. (7) The acceptor shall: (a) in a case where the acceptor requests the former holder, by notice under subsection (6), to give the acceptor an indemnity and also to provide security for the indemnity—within 14 days after the day on which the indemnity is given to the acceptor or the day on which the security is provided, whichever last occurs; (b) in a case where the acceptor requests the former holder, by notice under subsection (6), to give the acceptor an indemnity, but does not also request the former holder to provide security for the indemnity—within 14 days after the day on which the indemnity is given to the acceptor; or (c) in any other case—within 14 days after the day on which the notice under subsection (5) is given to the acceptor; accept the replacement bill to the same tenor as the acceptor’s acceptance of the original bill and give the replacement bill so accepted to the former holder. (8) Where the original bill had been indorsed before its loss or destruction, the former holder may give the replacement bill to the indorser and request the indorser, by notice in writing, to indorse the replacement bill to the same tenor as the indorser’s indorsement of the original bill. (9) The indorser may, by notice in writing given to the former holder within 14 days after the day on which the notice under subsection (8) is given to the indorser, request the former holder to give the indorser an indemnity in respect of any loss and expenses that the indorser may reasonably incur by reason of the indorsing of the bill to the same tenor as the indorser’s indorsement of the original bill, and may also request the former holder to provide adequate security for the indemnity. (10) The indorser shall: (a) in a case where the indorser requests the former holder, by notice under subsection (9), to give the indorser an indemnity and also to provide security for the indemnity—within 14 days after the day on which the indemnity is given to the indorser or the day on which the security is provided, whichever last occurs; (b) in a case where the indorser requests the former holder, by notice under subsection (9), to give the indorser an indemnity, but does not also request the former holder to provide security for the indemnity—within 14 days after the day on which the indemnity is given to the indorser; or (c) in any other case—within 14 days after the day on which the notice under subsection (8) is given to the indorser; indorse the replacement bill to the same tenor as the indorser’s indorsement of the original bill and give the replacement bill so indorsed to the former holder. (11) Where the drawer, acceptor or indorser refuses or fails to comply with subsection (4), (7) or (10), as the case requires, the former holder may apply to a court of competent jurisdiction for an order directing: (a) the drawer to draw a replacement bill to the same tenor as the original bill and give the replacement bill to the former holder; (b) the acceptor to accept the replacement bill to the same tenor as the acceptor’s acceptance of the original bill and give the replacement bill so accepted to the former holder; or (c) the indorser to indorse the replacement bill to the same tenor as the indorser’s indorsement of the original bill and give the replacement bill so indorsed to the former holder; as the case may be. (12) Where an application is made to a court of competent jurisdiction for an order of a kind referred to in subsection (11), the court may make the order on such terms and conditions as it considers just and equitable. #### 75 Action on lost bill In any action or proceeding upon a bill, the Court or a Judge may order that the loss of the instrument shall not be set up, provided an indemnity be given to the satisfaction of the Court or Judge against the claims of any other person upon the instrument in question. ### Division 10—Bill in a set #### 76 Rules as to sets (1) Where a bill is drawn in a set, each part of the set being numbered, and containing a reference to the other parts, the whole of the parts constitute one bill. (2) Where the holder of a set indorses two or more parts to different persons, he or she is liable on every such part, and every indorser subsequent to him or her is liable on the part he or she has indorsed, as if the said parts were separate bills. (3) Where two or more parts of a set are negotiated to different holders in due course, the holder whose title first accrues is, as between such holders, deemed the true owner of the bill; but nothing in this subsection shall affect the rights of a person who in due course accepts or pays the part first presented to him or her. (4) The acceptance may be written on any part, and it must be written on one part only. If the drawee accepts more than one part, and such accepted parts get into the hands of different holders in due course, he or she is liable on every such part as if it were a separate bill. (5) When the acceptor of a bill drawn in a set pays it without requiring the part bearing his or her acceptance to be delivered up to him or her, and that part at maturity is outstanding in the hands of a holder in due course, he or she is liable to the holder thereof. (6) Subject to the preceding rules, where any one part of a bill drawn in a set is discharged by payment or otherwise, the whole bill is discharged. ### Division 11—Conflict of laws #### 77 Rules where laws conflict Where a bill drawn in one country is negotiated, accepted, or payable in another, the rights, duties, and liabilities of the parties thereto are determined as follows: (a) The validity of a bill as regards requisites in form is determined by the law of the place of issue, and the validity as regards requisites in form of the supervening contracts, such as acceptance, or indorsement, or acceptance supra protest, is determined by the law of the place where such contract was made: Provided that: (i) where a bill is issued out of Australia, it is not invalid by reason only that it is not stamped in accordance with the law of the place of issue; (ii) where a bill, issued out of Australia, conforms, as regards requisites in form, to the law of Australia, it may, for the purpose of enforcing payment thereof, be treated as valid as between all persons who negotiate, hold, or become parties to it in Australia. (b) Subject to the provisions of this Act, the interpretation of the drawing, indorsement, acceptance, or acceptance supra protest of a bill, is determined by the law of the place where such contract is made. Provided that, where an inland bill is indorsed in a foreign country, the indorsement shall as regards the payer be interpreted according to the law of Australia. (c) The duties of the holder with respect to presentment for acceptance or payment, and the necessity for or sufficiency of a protest or notice of dishonour, or otherwise, are determined by the law of the place where the act is done or the bill is dishonoured. (d) Where a bill is drawn out of but payable in Australia and the sum payable is not expressed in the currency of Australia, the amount shall, in the absence of some express stipulation, be calculated according to the rate of exchange for sight drafts at the place of payment on the day the bill is payable. (e) Where a bill is drawn in one country and is payable in another, the due date thereof is determined according to the law of the place where it is payable. #### 77A Effect of non‑compliance with stamp laws in case of certain bills of exchange A bill issued in Australia which is presented for acceptance, accepted, or payable, outside Australia shall not be invalid by reason only that it is not stamped, or is not properly stamped, in accordance with any law for the time being in force requiring that bill to be stamped, and any such bill which is unstamped or is not properly stamped may be received in evidence on payment of the proper duty and penalty (if any). ## Part III—Cheques on a banker ### Division 1—Cheques generally #### 78 Cheque defined (1) A cheque is a bill of exchange drawn on a banker payable on demand. (2) Except as otherwise provided in this Part, the provisions of this Act applicable to a bill of exchange payable on demand apply to a cheque. #### 79 Presentment of cheque for payment Subject to the provisions of this Act: (a) where a cheque is not presented for payment within a reasonable time of its issue, and the drawer or the person on whose account it is drawn had the right, at the time at which the presentment ought to have been made, as between him or her and the banker, to have the cheque paid, and suffers actual damage through the delay, he or she is discharged to the extent of such damage, that is to say, to the extent to which such drawer or person is a creditor of such banker to a larger amount than he or she would have been had such cheque been paid; (b) in determining what is a reasonable time, regard shall be had to the nature of the instrument, the usage of trade and of bankers, and the facts of the particular case; (c) the holder of such cheque as to which such drawer or person is discharged shall be a creditor, in lieu of such drawer or person, of such banker to the extent of such discharge, and entitled to recover the amount from him or her. #### 80 Rights of banker as regards stale cheques (1) In the absence of any agreement between the banker and the drawer of the cheque or of any direction of the drawer of the cheque to the contrary, a banker may refuse payment of a stale cheque. (2) A stale cheque is a cheque which appears on the face of it to have been in circulation for more than twelve months. #### 81 Revocation of banker’s authority The duty and authority of a banker to pay a cheque drawn on him or her by his or her customer are determined by: (a) countermand of payment; (b) notice of the customer’s death. ### Division 2—Crossed cheques #### 82 General and special crossings defined (1) Where a cheque bears across its face an addition of: (a) the word “bank” or the words “and company” or any abbreviation thereof respectively, between two parallel transverse lines, either with or without the words “not negotiable”; or (b) two parallel transverse lines simply, either with or without the words “not negotiable”; that addition constitutes a crossing, and the cheque is crossed generally. (2) Where a cheque bears across its face an addition of the name of a banker, either with or without the words “not negotiable”, that addition constitutes a crossing, and the cheque is crossed specially and to that banker. #### 83 Crossing by drawer or after issue (1) A cheque may be crossed generally or specially by the drawer. (2) Where a cheque is uncrossed, the holder may cross it generally or specially. (3) Where a cheque is crossed generally, the holder may cross it specially. (4) Where a cheque is crossed generally or specially, the holder may add the words “not negotiable”. (5) Where a cheque is crossed specially, the banker to whom it is crossed may again cross it specially to another banker for collection. (6) Where an uncrossed cheque, or a cheque crossed generally, is sent to a banker for collection, he or she may cross it specially to himself or herself. #### 84 Crossing a material part of cheque A crossing authorized by this Act is a material part of the cheque; it shall not be lawful for any person to obliterate, or, except as authorized by this Act, to add to or alter the crossing. #### 85 Duties of banker as to crossed cheques (1) Where a cheque is crossed specially to more than one banker (except when crossed to an agent for collection, being a banker) the banker on whom it is drawn shall refuse payment thereof. (2) Where a banker on whom a cheque is drawn: (a) if the cheque is crossed specially to more than one banker (except when crossed to an agent for collection, being a banker), pays the cheque; or (b) if the cheque is crossed generally, pays it otherwise than to a banker; or (c) if the cheque is crossed specially, pays it otherwise than to the banker to whom it is crossed or his or her agent for collection, being a banker; such banker is liable to the true owner of the cheque for any loss he or she may sustain owing to the cheque having been so paid. (3) Provided that where a cheque is presented for payment which does not at the time of presentment appear: (a) to be crossed; or (b) to have had a crossing which has been obliterated; or (c) to have a crossing which has been added to or altered otherwise than as authorized by this Act; the banker paying or receiving payment of the cheque in good faith and without negligence shall not be responsible or incur any liability, nor shall the payment be questioned by reason of the cheque having been crossed, or of the crossing having been obliterated or having been added to or altered otherwise than as authorized by this Act, and of payment having been made otherwise than to a banker or to the banker to whom the cheque is or was crossed, or to his or her agent for collection, being a banker, as the case may be. #### 86 Protection to banker and drawer where cheque is crossed Where the banker, on whom a crossed cheque is drawn, in good faith and without negligence: (a) if it is crossed generally, pays it to a banker; and (b) if it is crossed specially, pays it to the banker to whom it is crossed, or his or her agent for collection, being a banker; the banker paying the cheque, and, if the cheque has come into the hands of the payee, the drawer, shall respectively be entitled to the same rights and be placed in the same position as if payment of the cheque had been made to the true owner thereof. #### 87 Effect of crossing on holder Where a person takes a crossed cheque which bears on it the words “not negotiable”, he or she shall not have and shall not be capable of giving a better title to the cheque than that which the person from whom he or she took it had. #### 88A Cheques drawn by a bank on itself For the purposes of this division cheque includes a banker’s draft payable on demand drawn by or on behalf of a bank upon itself, whether payable at the head office or at some other office of the Bank. ### Division 3—Other provisions relating to cheques #### 88B Protection of bankers paying unindorsed or irregularly indorsed cheques or drafts (1) Where a banker in good faith and in the ordinary course of business pays to another banker a cheque drawn on the first‑mentioned banker that is not indorsed, is irregularly indorsed or has been indorsed without authority: (a) the first‑mentioned banker does not, in paying the cheque, incur any liability by reason only of the absence of, or irregularity in, indorsement or his or her failure to concern himself or herself with the existence of authority for indorsement; and (b) he or she shall be deemed to have paid the cheque in due course. (2) Where a banker in good faith and in the ordinary course of business pays to another banker a draft drawn by the first‑mentioned banker upon himself or herself and payable on demand, whether the draft is payable at the head office or at some other office of the banker: (a) the first‑mentioned banker does not, in paying the draft, incur any liability by reason only of the absence of, or irregularity in, indorsement or his or her failure to concern himself or herself with the existence of authority for indorsement; and (b) the payment discharges the draft. (3) For the purposes of the last two preceding subsections, a banker who: (a) has paid a cheque drawn on him or her or a draft drawn by him or her upon himself or herself; and (b) has credited the account of a customer with the amount of the cheque or draft; shall be deemed to have paid the cheque or draft to another banker. #### 88C Payment of unindorsed cheque or draft as evidence of receipt by payee (1) An unindorsed cheque payable to order that appears to have been paid by the banker on whom it is drawn is evidence of the receipt by the payee of the sum payable by the cheque. (2) The last preceding subsection applies in relation to a draft drawn by a banker upon himself or herself and payable on demand, whether the draft is payable at the head office or at some other office of the banker, as it applies in relation to a cheque. #### 88D Protection of bankers collecting payment of cheques etc. (1) Where: (a) a banker, in good faith and without negligence: (i) receives payment for a customer of a cheque; or (ii) having credited a customer’s account with the amount of a cheque, receives payment of the cheque for himself or herself; and (b) the customer has no title, or has a defective title, to the cheque; the banker does not incur any liability to the true owner of the cheque by reason only of having received payment of the cheque. (2) Subject to the next succeeding subsection, a banker shall not be treated for the purposes of this section as having been negligent by reason only of his or her failure to concern himself or herself with the absence of, or irregularity in, indorsement of a cheque. (3) The last preceding subsection does not apply in relation to a cheque unless the name appearing on the cheque as the name of the payee: (a) is the same as the name of the customer; or (b) is so similar to the name of the customer that it was reasonable, in all the circumstances, for the banker to assume that the customer was the person intended by the drawer to be the payee. (4) This section applies in relation to a draft drawn by a banker upon himself or herself and payable on demand, whether the draft is payable at the head office or at some other office of the banker, as it applies in relation to a cheque. #### 88E Rights of banker collecting cheque not indorsed by payee A banker who gives value for, or has a lien on, a cheque payable to order that the payee, without indorsing the cheque, delivers to the banker for collection for the payee has such rights (if any) as he or she would have had if, upon the delivery of the cheque to him or her, the payee had indorsed it in blank. ## Part IV—Promissory notes #### 89 Promissory note defined (1) A promissory note is an unconditional promise in writing made by one person to another, signed by the maker, engaging to pay, on demand or at a fixed or determinable future time, a sum certain in money, to or to the order of a specified person, or to bearer. (2) An instrument in the form of a note payable to maker’s order is not a note within the meaning of this section unless and until it is indorsed by the maker. (3) A note is not invalid by reason only that it contains also a pledge of collateral security with authority to sell or dispose thereof. (4) A note which is, or on the face of it purports to be, both made and payable within Australasia is an inland note. Any other note is a foreign note. #### 90 Delivery necessary A promissory note is inchoate and incomplete until delivery thereof to the payee or bearer. #### 91 Joint and several notes (1) A promissory note may be made by two or more makers, and they may be liable thereon jointly, or jointly and severally, according to its tenor. (2) Where a note runs “I promise to pay” and is signed by two or more persons it is deemed to be their joint and several note. #### 92 Note payable on demand (1) Where a note payable on demand has been indorsed, it must be presented for payment within a reasonable time of the indorsement. If it be not so presented the indorser is discharged. (2) In determining what is a reasonable time, regard shall be had to the nature of the instrument, the usage of trade, and the facts of the particular case. (3) Where a note payable on demand is negotiated, it is not deemed to be overdue, for the purpose of affecting the holder with defects of title of which he or she had no notice, by reason that it appears that a reasonable time for presenting it for payment has elapsed since its issue. #### 93 Presentment of note for payment (1) Where a promissory note is in the body of it made payable at a particular place, it must be presented for payment at that place in order to render the maker liable. In any other case, presentment for payment is not necessary in order to render the maker liable. (2) Presentment for payment is necessary in order to render the indorser of a note liable. (3) Where a note is in the body of it made payable at a particular place, presentment at that place is necessary in order to render an indorser liable; but when a place of payment is indicated by way of memorandum only, presentment at that place is sufficient to render the indorser liable, but a presentment to the maker elsewhere, if sufficient in other respects, shall also suffice. #### 94 Liability of maker The maker of a promissory note, by making it: (a) engages that he or she will pay it according to its tenor; and (b) is precluded from denying to a holder in due course the existence of the payee and his or her then capacity to indorse. #### 95 Application of Part II to notes (1) Subject to the provisions in this Part and except as by this section provided, the provisions of this Act relating to bills of exchange apply, with the necessary modifications, to promissory notes. (2) In applying those provisions, the maker of a note shall be deemed to correspond with the acceptor of a bill, and the first indorser of a note shall be deemed to correspond with the drawer of an accepted bill payable to drawer’s order. (3) The following provisions as to bills do not apply to notes, namely, provisions relating to: (a) presentment for acceptance; (b) acceptance; (c) acceptance supra protest; (d) bills in a set. (4) Where a foreign note is dishonoured, protest thereof is unnecessary. ## Part V—Supplementary #### 96 Good faith A thing is deemed to be done in good faith, within the meaning of this Act, where it is in fact done honestly, whether it is done negligently or not. #### 97 Signature (1) Where, by this Act, any instrument or writing is required to be signed by any person, it is not necessary that he or she should sign it with his or her own hand, but it is sufficient if his or her signature is written thereon by some other person by or under his or her authority. (2) In the case of a corporation, where, by this Act, any instrument or writing is required to be signed, it is sufficient if the instrument or writing be sealed with the corporate seal. But nothing in this section shall be construed as requiring the bill or note of a corporation to be under seal. #### 98 Computation of time (1) Where, by this Act, the time limited for doing any act or thing is less than three days, in reckoning time, non‑business days are excluded. (2) When the day on which any payment, presentment, notice, noting, protest, acceptance, act or thing should be made, given, or done in connexion with a bill, cheque, or note falls on a non‑business day, it may be made, given, or done on the business day next following. (3) For the purposes of this Act, Christmas Day, Good Friday, a Sunday or a bank holiday is a non‑business day, and any other day is a business day. (4) Where, by or in pursuance of a law of the Commonwealth (including a law of a Territory) or a law of a State, any day is declared to be a bank holiday in the Commonwealth or in a State or in a part of the Commonwealth or of a State, that day shall, for the purposes of this Act, be a bank holiday in the Commonwealth or in the State or in the part of the Commonwealth or of the State as the case requires. (5) Where, by or in pursuance of a law of the Commonwealth (including a law of a Territory) or a law of a State, any portion of a day is declared to be a bank half‑holiday in the Commonwealth or in a State or in a part of the Commonwealth or of a State, the day shall be deemed to be a bank holiday so far as regards bills of exchange and promissory notes payable on that day at any bank in the locality to which the half‑holiday applies and not presented for payment during the portion of the day not included in the bank half‑holiday. #### 99 When noting equivalent to protest For the purposes of this Act, where a bill or note is required to be protested within a specified time or before some further proceeding is taken, it is sufficient that the bill has been noted for protest before the expiration of the specified time or the taking of the proceeding; and the formal protest may be extended at any time thereafter as of the date of the noting. #### 100 Protest when notary not accessible (1) Where a dishonoured bill or note is authorized or required to be protested, any householder or substantial resident of the place where the bill is dishonoured may, in the presence of two witnesses, give a certificate, signed by them, attesting the dishonour of the bill, and the certificate shall in all respects operate as if it were a formal protest of the Bill. (2) The form given in the Second Schedule may be used with necessary modifications, and if used shall be sufficient. #### 101 Dividend warrants (1) The provisions of this Act as to crossed cheques shall apply to dividend warrants. (2) Nothing in this Act shall affect the validity of any usage relating to dividend warrants or the indorsement thereof.