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Decisions of the Superior Courts of New South Wales, 1788-1899

Buchanan v Keith (1829) NSW Sel Cas (Dowling) 366; [1829] NSWSupC 75

bill of exchange - laches - customs and usages

Supreme Court of New South Wales

Dowling J., 10 December 1829

Source: Sydney Gazette, 12 December 1829[1 ]

This action was brought to recover the sum of £28 on a bill of exchange drawn by Mr. George Alexander Leary on Mr. George Bishop of London, endorsed by the defendant, and made payable to Mr. Walter Buchannan, also in London, at 10 days sight.

Mr. Norton, in stating the case to the Court, said that the bill had been presented to the drawer but had not been accepted; that agreeably to the general usage with respect to bills at short dates, it had been detained till the expiration of the ten days, when it was presented for payment, and dishonoured, upon which a general protest had been made for non-acceptance and non-payment.  Notice of the dishonour had been given to the defendant on the arrival of the protest in the Colony; but he (Mr. Norton) understood that the defence would be, that he was not liable, as a separate protest, for non-acceptance had not been transmitted to him.  Evidence, however, would be offered to the Court, to shew that there were no available means of transmitting notice of non-acceptance, as the ship which brought out the notice of non-payment was the first vessel that sailed for this Colony after the bill had been presented for acceptance.

Mr. Norton then proved the handwriting of the defendant, and handed in the protest, verified in the usual form.

Mr. John Lamb examined by Mr. Norton -- I received this bill and the protest which has just been read --

Examined by Mr. Keith on the voir dire -- I am a partner with Mr. Walter Buchannan, in the business carried on in this Colony, but I have nothing to do with his mercantile concerns in England; I have no interest whatever in this bill.

By Mr. Norton -- I received the bill and the protest by the ship Sovereign, on the 5th of August last, and the 6th I wrote to Mr. Keith, and sent the letter to him of the 7th or 8th; I called several times at his house, but did not see him till about ten days after, when he told me that he received no value for the bill, and did not consider himself bound to pay it; I said that as he was the endorser, I should be obliged to bring the case into Court if the bill were not paid, and he then said that he would give me an answer whether he would pay it or not, in the course of a week, and requested that I would defer proceedings till then; I waited a longer time, but receiving no communication from Mr. Keith, I put the case into the hands of Mr. Norton; I have every reason to believe that no vessel sailed from England between the 1st of April and the 18th, when the bill was put on board the Sovereign, by which a protest for non-acceptance might have been transmitted.

Cross-examined by Mr. Keith. -- I sent no copy of the protest to the defendant; I merely gave him intimation that I had received the Bill under protest.

By the Court. -- In London, Bills at very short dates are not usually protested for non-acceptance; I conclude so from having had other Bills sent me from London merely with a protest for non-payment; I know instances of protests for non-acceptance, and also for non-payment being sent out, but it was where the Bills had a long date to run; the expense of protest and noting at home is about 12s 6d.; a second protest, of course, would make the expense double that amount; it is usual in London to present Bills at short dates for acceptance, and also for payment, when at maturity, although they have not been accepted; the holder does so to avoid entailing an increased expense on the party who may appear to be liable, and in the hope that funds might arrive in the interim between the presentation for acceptance, and the Bill becoming due; I should consider it a hardship on the party, if a Bill at a short date were not presented for payment, when at maturity, though it had not been accepted.

By Mr. Keith --- I believe Capt. Leary, the drawer of the Bill, was in England when it was at maturity.

This was the plaintiff's case.

Mr. Keith submitted to the Court, that he was entitled to a non-suit on the ground that there had been no protest for non-acceptance.  The reasons assigned by Mr. Norton why it was not required, would be very well as against the drawer, but not as against an endorser.  It was not necessary to go into the history of the Bill, part of which was actually his own money, due to him for costs; but as he was a perfectly innocent endorser, he felt it due to himself to avail himself of every advantage, particularly as the drawer was in England at the time the Bill was presented for payment.  True, in the body of the protest for non-payment, something was stated about time having elapsed since the non-acceptance; but he contended there was nothing to prove that the Bill was ever presented for acceptance, and if it was not, of course it would not have been paid.  On these grounds, supported by the authority of the Chief Justice, in the case of Kay against Hutchinson, in which the same point was raised some time ago in the Supreme Court, he submitted he was entitled to a nonsuit.

Mr. Justice Dowling said, that having some doubt upon the point himself, and entertaining the utmost deference for the opinion of his Honourable and learned colleague, the Chief Justice, he would reserve the objection, and put the case to the Assessors, on the evidence of Mr. Lamb, as to whether the custom of not protesting Bills at short dates for non-acceptance, was a reasonable custom, and calculated to meet the justice of the case by saving expense to the party who might be ultimately liable in case of non-payment by the drawee,

Mr. Keith then stated, that he had another ground of objection, namely, that there were laches on the part of Mr. Lamb.  It appeared from his evidence, that he had received the protest himself on the 5th of August, and had not given notice to the defendant till the 7th or 8th.

The learned Judge, having referred to his notes, called on Mr. Norton to know what reply he had to make to that objection.

Mr. Norton said, if His Honor was of opinion there was any weight in the objection, he would claim permission of the Court to examine Mr. Lamb on that point, as he had no doubt he could show sufficient reason for the delay.

The learned Judge said the case for the plaintiff was closed, and the objection taken on the evidence as it appeared in his notes.

After some discussion, Mr. Keith said he had no objection to Mr. Lamb being recalled.

Mr. John Lamb examined by Mr. Norton -- I received a number of letters from London on the 5th of August, but I am not sure that I read the letter in reference to this Bill till the 6th; on the 6th I wrote a letter to Mr. Keith, and made enquiry of my clerk if he knew where he was to be found or who he was; my clerk came out from England with me, and had not been, at that time, above two months in the Colony; on the same day I directed him to make every enquiry, and on the 7th I heard that there was a Mr. Keith, a lawyer, living in Pitt-street, but I still had my doubts as to whether he was the person, as it being a Bill transaction, I thought it more likely to be some merchant or dealer; I, however, made further enquiry, and upon ascertaining that the initials were the same, I directed the letter to be left at the defendant's house.

Cross-examined by Mr. Keith -- I knew there was a post office in Sydney; I did not know that Mr. Buchannan sent the defendant a trade list from London; I do not know that the letter was left at the defendant's house on the 7th of August, but I directed it to be; my clerk is not here.

Mr. Justice Dowling --- I fear, Mr. Norton, I am bound by the authority of law to hold that there has not been sufficient notice.  There certainly have been laches, and I must, therefore, direct a nonsuit, leaving the case open for you, should you think proper, to take the opinion of the other Judges.  If it is your wish I will take the opinion of the Assessors as to the reasonableness of the practice of not protesting Bills at short dates for non-acceptance, so that the case will be cleared of that point.

Mr. Norton having expressed a desire that such course might be adopted, the learned Judge put the case to the Assessors on that point, who immediately expressed their opinion that the custom was reasonable and calculated to meet the justice of the case, as funds might arrive to meet the bill before it arrived at maturity, and expense be thereby saved to the party who would otherwise be liable.

 

Forbes C.J., Stephen and Dowling JJ, 19 December 1829

Source: Dowling, Proceedings of the Supreme Court, Vol. 29, Archives Office of New South Wales, 2/3212[2 ]

[p. 45]Saturday 19th Dec. 1829

In Banco.

Present Forbes CJ

Stephen J

Dowling J

This was an action by the indorsee against the indorser of a bill of Exchange for 28£ sterling.  The Bill was drawn at Sydney on the 28th August 1828 by one Alexander Leary upon one George Bishop No.134 Fenchurch Street London payable 10 days after sight to the order of James Flaherty, indorsed by him to the Deft, by the deft indorsed to one James Harvey & by Harvey indorsed to the Plf.  [p. 46] At the Trial before Dowling J (Vide Vol 28 p.158)[3 ] the Defts handwriting was proved, & the handwriting of Alexander Leary was admitted.  The Plfs Counsel then put on a protest under the hand & seal of a London notary public, by which it appeared that the bill when at maturity (15 April 1829) was presented & payment demanded of George Bishop No 134 Fenchurch Street London & payment refused.  This instrument recited the fact that the bill had been noted for non acceptance.  It was proved by the plf's agent resident in Sydney that on the 5th August last he received a great many letters by the Leary's & amongst them one inclosing the bill & the protest.  He was not sure that he opened this letter until the 6th on which day he wrote a letter to Mr. Keith giving him notice of the dishonour & made inquiries of his clerk whether he knew any person of that name in Sydney.  He did not know Mr. Keith or his handwriting, nor was there any information conveyed to him by the bill itself who Mr. Keith was.-  On the 7th he learnt that there was [p. 47] a lawyer named Keith living in Pitt Street; & that the indorser of the bill was more likely to be a merchant than Mr. Keith the lawyer.  He had desired his clerk to leave the letter at Mr Keith's on the 6th.  He knew that there was a post office in Sydney, but did not desire the letter to be put into the post.  Witness had been in the Colony only two months before.  It being intimated by the Deft that he meant to object to the want of a protest for non acceptance & that a protest for non payment was not sufficient, the same witness I take that in the case of foreign Bills drawn at such rates it was not he believed the custom of Merchants in London to protest bills for non acceptance.  The case was otherwise in the case of bills of pay dates.  A protest for non acceptance & for non payment wd cost 12/6 each.  The plf then stated that between the 1st & 15th April, the day on which the bill was presented & indoresed, no vessel had departed for this Colony, by which a protest for non-acceptance could have been transmitted, subsequently that a protest for non-acceptance would have been useless.  It was rejected on the part of the Deft.  1st. that there ought to have been [p. 48] a protest for non acceptance as well as for non payment; & 2nd. that the notice of dishonour was not sufficiently prompt with respect to the first point.  The judge said that as Bills of Exchange were the creatures of custom he wd. leave it to the jury to lay upon the evidence whether usuage of them by Mr. Keith in the case of bills of such dates existed, & whether it was reasonable custom.  As to the second point, he thought upon authorities that the notice of dishonour not being sufficiently prompt, the indorser was discharged, but I reviewed that point.  The assessors found the usuage & the reasonableness of it.  On the final point I directed a non suit, with liberty to the plf to move for a new trial.  Upon the second point, he was opinion upon after consideration that it ought to have been left to the assessors as a question of fact, whether the plf's agent had used due diligence in giving the Deft notice of the dishonour.-

[49] Note.- The Sheriff applied for leave to continue in custody at Newcastle certain debtors taken in execution instead of removing them to Sydeny.-

The Court said there must be a general rule upon the subject.

 

Forbes C.J., Stephen and Dowling JJ, 30 December 1829

Source: Australian, 2 January 1830

Bucheanan v. Keith.  Plaintiff's attorney, (Mr. Norton) in this case, moved the Court to set aside a non suit on an action of assumpsit, which had been tried during the present Term before Mr. Justice Dowling, and Messrs. Manning and Busby, Assessors, on a Bill of Exchange, drawn in favour of defendant, by Leary at ten days' sight, on Bishop, of Fenchurch-street, London, and endorsed by defendant, but which when presented for acceptance had been refused, and subsequently dishonored by the drawer.  When sent out to this country, defendant refused to discharge the bill, on the ground of a protest of non-acceptance having been omitted to be sent with the protest of non-payment; which Mr. Justice Dowling ruled was proper and agreeable to high legal preccedents, and a non-suit was accordingly entered for the defendant.  Plaintiff's attorney grounded his motion for a new trial on the plea of misconception, and that a second protest was not necessary.

Mr. Keith, on the other side, maintained, that a non-acceptance protest was necessary in this case it being so laid down in the books.  He contended that the Court could not depose from established authority, and moreover, that due notice had not been given to defendant as to the non payment of the bill.

Mr. Justice Stephen expressed himself of opinion, that the non-suit should be set aside, on the ground that a protest of non-payment was sufficient, without being accompanied by a protest for non-acceptance.  The protest before the Court was, what he (the Learned Judge) had usually seen accompanying a Bill of Exchange, and he considered it ought to have been matter for the Assessors to decide, whether or not due diligence had been used by the plaintiff in giving notice of non-payment.

Mr. Chief Justice Forbes gave it as his opinion, that on the first point, the law was too firm and well established to be set aside; that a protest for non-acceptance was necessary; and therefore he considered the non-suit ought to stand, consequently he would not enter into any argument on the second point.

Mr. Justice Dowling said, that since the trial he had directed his utmost attention to the case of which this motion constituted the subject.  He still was of opinion, that the non-suit be directed on the trial was right, and that it ought to stand. - Application refused.

 

Notes

[1 ] See also Australian, 16 December 1829.

[2 ] Part of this report was also in Dowling, Select Cases, Vol. 2, Archives Office of N.S.W., 2/3462, p. 257.  The Select Cases version commenced with the following summary of the decision, apparently written by Dowling J.:

"Where a Bill drawn in N.S.W. upon a house in London at ten days sight was dishonored when it would have been at maturity and the holder sent out to Sydney a protest for non payment only without a protest for non acceptance having been refused   Held that an indorser of the bill in Sydney was not liable."

[3 ] This reference is to the full collection of 248 notebooks of Dowling J.  They are collected in the Archives Office of New South Wales as "Proceedings of the Supreme Court of New South Wales 1828-40", reference 2/3184-396, 2/3400-33.

 

Published by the Division of Law, Macquarie University