The happening of the contingency on which the payment CHAPTER of the bill is dependent will not cure the defect (s). VII. A note beginning, "I, A. B., promise, &c.," and signed Makers or A. B., or else C. D., is a good note against A. B., but only payees liable evidence as against C. D. of a conditional agreement to pay in the alterif A. B. does not (t). In this last case the maker was uncertain; the note, as such, was not available at all, if the payee were uncertain. Thus, where the maker promised to pay to A. or to B. and C. a certain sum, Abbott, C.J., said, "I have no doubt this instrument is not a promissory note within the statute of Anne; for if a note is made payable to one or other of two persons, it is payable only on the contingency of its not having been paid to the other, and is not a good promissory note within the statute;" but now there may be alternative payees (u). So a bill of exchange or promissory note payable after date to the secretary for the time being of a company was formerly void as a bill or note, but now such a bill or note is valid (x). or entitled native. particular Upon the same principle the bill or note must not be Not to be made payable out of a particular fund (y), for the fund made payable Plaintiff drew upon A., and re- out of a may prove insufficient. quired him to pay B. 77. per month out of plaintiff's grow- fund. ing subsistence. This was held no bill of exchange, for, had plaintiff died, or his subsistence been taken away, the bill would not have been payable (z). So, an order from the owner of a ship to the charterer, to pay money on account of freight, is no bill; for the future existence and amount of any debt due for freight are subject to a contingency (a). And the same rule holds if the contingency is expressed on the back of the note, by an indorsement made before the note was a perfect instrument (b). (s) Hill v. Halford, 2 B. & P. 413; Code, s. 11 (3). (t) Ferris v. Bond, 4 B. & Al. 679; and see Appleby v. Biddulph, B. N. P. 272, cited Morice v. Lee, 8 Mod. 363; 4 Vin. Ab. 240, pl. 16; Ex parte Yates, 2 De G. & J. 191; Code, s. 56. (u) Blanckenhagen v. Blundell, 2 B. & Ald. 417; Code, s. 7. (x) Code, s. 7; Storm v. Stirling, 3 E. & B. 832; Cowie v. Stirling, 6 E. & B. 333; Yates v. Nash, 8 C. B., N. S. 581; but see Holmes v. Jaques, ante, p. 84. (y) Jenny v. Herle, 2 Ld. Raym. 1361; 8 Mod. 265; 1 Stra. 591; Haydock v. Lynch, 2 Ld. Raym. 1553; Dawkes v. Lord de Loraine, 2 W. Bla. 782; 3 Wils. 207; Yates v. Grove, 1 Ves. jun. 280; Carlos v. Fancourt, 5 T. R. 482. (z) Josselyn v. Lacier, 10 Mod. 294; Fort. 281; see Russell v. Powell, 14 M. & W. 418. (a) Banbury v. Lissett, 2 Stra. 1211. (b) Leeds v. Lancashire, 2 Camp. 205. CHAPTER Irregular bill or note. Debentures, Policies, scrip. But the statement of a particular fund in a bill of exchange will not vitiate it if introduced merely as a direction to the drawee how to reimburse himself or show the particular account to be debited; thus a bill directing the drawee to pay J. S. 97. 10s., "as my quarterly half-pay," was held to be a good bill (c). If the instrument be defective as a bill or note, it still may be evidence of an agreement (d). Debentures are not promissory notes, and should, it coupons and seems, be stamped with a debenture stamp, and not with the ad valorem stamps of promissory notes (e). Policies of insurance are not promissory notes, the promise being only conditional, and are rightly stamped as agreements with a 6d. stamp (ƒ). Coupons for interest, whether attached or not to the debentures, are not promissory notes, and require no stamp (g). Bank Post Scrip issued in England by the agent of a foreign government, by which the holder is to be entitled, on payment in full of the instalments due from him, to the delivery of definitive bonds, passes by mere delivery to a bona fide holder for value, such being the usage amongst bankers and dealers (h). Bank Post Bills are bills issued by bankers (generally at seven days when issued by the Bank of England) for convenience in remitting small or odd sums of money. Being issued, accepted, they are practically equivalent to promissory notes (i). (c) Macleod v. Snee, 2 Str. 762; Code, s. 3 (3). (d) By the Stamp Act, 1870, bills of exchange and promissory notes include any documents or writings (other than bank notes) containing a promise to pay out of a particular fund or on any condition, and such documents must be stamped in accordance with the Act; those in the form of bills of exchange with a fixed duty of one penny being deemed payable on demand, and those in the form of promissory notes in accordance with the scale. See post, Chapter on STAMP. (e) British India Steam Com pany v. Inland Revenue Commissioners, 7 Q. B. D. 165; 50 L. J. 517. (f) Mortgage Insurance Co. v. Commissioners of Inland Revenue, 20 Q. B. D. 645; 21 Q. B. D. 352; 57 L. J. 630. (g) Enthoven v. Hoyle, 13 C. B. 373; 21 L. J., C. P. 100. 33 & 34 Vict. c. 97, sched. tit. "Bill of Exchange," Exemption 9. (h) Goodwin v. Roberts, L. R., 10 Ex. 76; 1 Ap. Cas. 476; 45 L. J. 748; where a full history of the progressive development of negotiable qualities in instruments will be found in the judgment of the Lord Chief Justice. Rumball v. Metropolitan Bank, L. R., 2 Q. B. D. 194. (i) Forbes v. Marshall, 24 L. J., Ex. 305; Willis v. Bank of Eng. Letters of credit and circular notes are methods of ob- CHAPTER VII. taining credit abroad, introduced for the convenience of travellers and agents, to obviate the trouble and risk of Letters of carrying about coin or bank notes. credit and They are now generally used together, in which case the circular letter of credit is called a letter of indication. A letter of credit is an authority, or rather request, by a banker to his foreign correspondents therein named, to discount bills drawn on him by the bearer. Circular notes are the unsigned drafts, generally for some specific amount, given with the letter and to be used or not at the bearer's discretion. The banker usually indemnifics himself against the bills by anticipation, in which case the bearer may recover the balance of his deposit, if any, on surrendering the letter and unused notes (j). It seems that the effect of such instruments is to place the issuer under a contract binding probably at law, but certainly so in equity (k), to pay even without acceptance (1) all bills drawn in conformity with the letter of credit; and the holders are not to be prejudiced by any set-off or cross claim by the drawee against the drawer (m). Letters of credit to be used in England require a stamp (n), those to be used abroad none (o), though presumably the drafts when brought to England for payment or negotiation fell within the 17 & 18 Vict. c. 83, s. 5, and now within the 51st section of the present Act, and perhaps should be stamped in accordance with the ad valorem scale. land, 4 A. & E. 21. As title can only be made through the payee's indorsement, they offer more security against loss than Bank notes. It is said that no days of grace are allowed on them, but this must be more a matter of courtesy than of right. See Code, s. 14. (j) But if any of the notes be lost it has been held that a satisfactory indemnity must be given, Conflans Company v. Parker, L. R., 3 C. P. 1; the loss being the customer's, Hume Dick v. Far- (k) Agra and Masterman's Bank (7) Com. Dig. tit. Merch. F. 3. (n) 33 & 34 Vict. c. 97, s. 48. notes. 110 CHAPTER VIII. OF AGREEMENTS INTENDED TO CONTROL THE Various sorts of agreements. SUCH agreements are either WRITTEN or oral. A written agreement is either on the instrument itself or on a distinct paper. Again, a written agreement on the instrument itself is either contemporaneous with the completion of the bill or note, or it is a subsequent agreement. Once more, even a contemporaneous written agreement may either be parcel of the instrument, or it may be collateral. Effect of conA memorandum on a bill or note, made before it is comtemporaneous plete, is sometimes considered as part of the instrument, so agreement as to control its operation, and sometimes not. written on the instrument. If the memorandum make the payment contingent, we have seen that it will be incorporated in the instrument (a). (a) Leeds v. Lancashire, 2 Camp. 205; Hartley v. Wilkinson, 4 M. & S. 25; 5 Camp. 127. Though by way of indorsement; Leeds v. Lancashire, supra. A joint and several promissory note had an indorsenient in this form: "The within note is given for securing floating advances from the Lincoln and Lindsay Banking Company, to the within-named Thomas Smith, sen. (one of the joint and several makers of the note), with lawful interest for the same from the respective times when such advances have been or may be made, together with commission, stamps, rostages, &c., and all usual charges and disbursements, not exceeding in the whole the sum of 1007. within mentioned." It was held to be an agreement VIII. But where it is merely directory, as if it point out the place CHAPTER of payment (b), or be merely the expression of an intended courtesy, as if it intimate a wish that the money lent should not be called in by the payee's executors till three years after his death (c); or if it import that a collateral security (as the deposit of title deeds) has been given (d); or be intended only to identify and ear-mark the instrument (e): it does not affect its operation. But a memorandum of the time when a note falls due may correct an error in the date (ƒ). A memorandum made after the note is perfected and Effect of an delivered is an independent agreement, requiring an agree- agreement ment stamp. "If," says Lord Ellenborough, "the memo-written on the subsequently randum was subsequently written, when the note had been instrument, perfected and delivered in its absolute state, it could not be considered as a part of that instrument, though it chanced to be inscribed upon the same piece of paper. In that case it was an agreement by way of defeasance, and it lay upon the defendant to produce it with a proper stamp" (g). A written agreement, on a distinct paper, to renew, or Effect of in other respects to qualify, the liability of the maker or agreement written on a acceptor, is good as between the original parties (h). Thus, distinct paper. if the drawer agree to indemnify the acceptor against a claim by other parties, for a portion of the sum for which the bill is drawn, and the acceptor afterwards pays those other parties a sum to which the indemnity applies, the acceptor's liability, as between himself and the drawer, will be reduced pro tanto, and he will not be turned round to his cross action on the indemnity (¿). But a written agreement, though contemporaneous, will Agreement contempora which could not be read in evidence without an agreement stamp. Sed quære, whether the indorsement were anything more than an explanation of the consideration. Cholmley v. Darley, 14 M. & W. 344. See the Chapter on CONSIDERATION. See now Code, s. 33. (b) Exon v. Russell, 4 M. & S. 505. (c) Stone v. Metcalfe, 4 Camp. 217; 1 Stark. 53. (d) Wise v. Charllon, 4 A. & E. 786; 6 Nev. & M. 364; 2 Har. & W. 49; Fancourt v. Thorne, 9 Q. B. 312. (c) Brill v. Crick, 1 M. & W. 232. (f) Fitch v. Jones, 5 E. & B. 238. And see Fanshawe v. Peet, 2 H. & N. 1. (g) Stone v. Metcalfe, 4 Camp. 217; 1 Stark. 53; 33 & 34 Vict. c. 97, s. 7. (h) Bowerbank v. Monteiro, 4 Taunt. 844; but it requires a good consideration to support it. M'Manus v. Bark, 5 L. R., Ex. 65 39 L. J. 65. (i) Carr v. Stephens, 9 B. & C. 758; 4 M. & R. 591, |