46Transfer of stale or dishonoured cheque by negotiation

46 Transfer of stale or dishonoured cheque by negotiation

(1) Where a stale cheque is transferred by negotiation to a person, the person: (a) takes the cheque subject to any defect of title affecting the cheque at the time when the cheque became a stale cheque; and (b) does not receive, and is not capable of giving, a better title to the cheque than the title that the person from whom the first‑mentioned person took the cheque had. (2) Where: (a) a cheque that has been dishonoured is transferred by negotiation to a person who takes the cheque with notice of the dishonour; and (b) the cheque is not a stale cheque at the time of the transfer; the person takes the cheque subject to any defect of title affecting the cheque at the time when the cheque was dishonoured. (3) Where a cheque is a stale cheque, every transfer of the cheque by negotiation shall, unless the contrary is proved, be presumed to have been effected before the cheque became a stale cheque.