DISHONORED BILLS OF EXCHARGE.

New Zealand Times, Volume XXXIII, Issue 5278, 23 February 1878, Page 1 (Supplement)

DISHONORED BILLS OF EXCHARGE.

■}’•"! ' '(Froth the European'MaiL) .'(;'(( I .•;,*» The Daily "News' gives the 1 'fallowing | para-' graphin its City article,:—We (aye informed that (the base 1 in* question 11 . is' that 6£ ’Williams V. Ayers/whiih,'"in Adelaide,' will’be under.? ( 'stood to'refer to the 'estate of 'Messrs. " Philip,' ’Lpyi', and'OH.', ' l ,which, l web.t‘ ll ri : 3 ; far 1 haok( as Septeihber, 1860, under the provisions of .the Insolvency,,Apt :-rrOur attention, has been : 1 drawn 1 *td ! a case Recently' decided; j'n' "the. jfpdicial Committee of the. Privy Council on appeal from'the Supreme -1 Court, of South Australia, which'will have'ah important bearing on .commercial practice. 11 The facts are that an English' .firm'wished 1 to prove 1 £'looo oh an 1 inshlyept 'estate'for 1 rejexehadge oh' certain 1 dishonored bills of exchange. " The appe|lahts alleged that, the claim arhse as follows, viz. :^Pour 1 several bill of 'exchange, aihouhting "to* ‘ £2tjjCi SO,’ (were 'handed to them'for the purpose" pf fejj'aying advances, and credit .for the'amount of the; said" bills (less the exchange) was given in hire account, it being "believed, that, the ,said bills . ’would be' duly ; paid.'' Every" endeavOic whs' made jto discountor ; sell the 'said bills, but’ without success ; ,consequently,’ all.the'bills were forwarded by'the’drawers' to- Australia. Two of them' were" accepted, but dishonored at maturity ; the other .two were dishonored jfor non-acceptance, and all the bills were returned to England, It was further’alleged I ';that the 'dishonor 1 of the "said, bills paused “ extreme (oss and inconvenience,’’-for which the sum claimed for re-eXchabgO was not'an equivalent. The respondents in the , case, urged that the bills were ; not negotiable instruments, and as a fact they .were refused by-'‘all : bankers" to whom they were’offered;'" It ihust be;b'oruo"iii, mind '.Jh'at there((was, no', specfal( new,'.consideration miven for the said drafts, and the original’ debt dmrespect of- which they were .given .'was !as'/ 'much duo from the partners Wlio(happened; to ,he.i residentjiin,. Australia i as, froinhthose ; in liondonj? ;In ai word, tno < special damage (accrued, from the dishonor' of‘ the ’drafts ; and, without going through the form of applying-for,' the;acpeptanoes the appellants had r at any time', before the.biUs wereigiven-the power of suing their debtors in Australia, or London, for the 1 amount of (the debt, and their,position or reiho-, (dieacpuld not therefore have, been in any way ’ .improved by the said’bills; x The Judgment 1 of ' the* Supreme'Court rested,oh 'thri (authority of h.yariety’pf-legaVppinions, mainly to the point (that:under.thencircumstances •< the idopuniehts relied bn were'not ‘such as,would 1 dlshpnpiythV .legal incident':, of re(-exchahge,; which by the custom of merchants attaches to bills of exchange properly and formally drawn. This view haS'bten upheld! lon appeal. Th’ere was incidentally raised -the; Rurisljion.ol: .usage ''or ’custrim 'rinlong' merchrilits and”bankers, which tqbde'd,altogether,tapKepule the right to’lovjt penal damages^' 1 20,’now reduced to

10,- per cent, on dishonored bills drawn On the Australian colonies or vice versa ; but their lordships’ recommendation to confirm thejudg'ment'bf the colonial courts will, it is believed, befounclto rest mainly oh the points that the appellants- suffered no-'damage, as their debt ;was'not'contracted to: be payable in Australia ; that they had. no., necessity to place money .thetejby bills’of by any otherjnstcument ; and .that'the remedies-fa .re the debt were perfect without the bills,.which they obtained Tor the mere purpose of their own convenience or ao-! eommodation... .